Operational review


Strategic outlook

Our vision is to remain a leader in Milling and Baking. Our identified priorities over the medium term are to lead innovation, and continue to build on our brands’ purpose to effect differentiation, while focusing on enhanced supply chain efficiencies. We will also be investing in maintaining superior route-to-market execution. In addition, we will seek to strengthen our brands visibility as tasty, quality nutrition, with strongholds developed and maintained in targeted geographies. In the ready-mix category, we aim to continue to lead the market, while driving value propositions through innovation. In other grains, we will maintain our market leadership through differentiated communication, purpose-driven campaigns and targeted pricing, while expanding into adjacent products and categories, and innovating to capitalise on growing trends. This will be supported by realising further manufacturing and supply chain efficiencies.

Revenue increased 5% to R13,9 billion, reflecting price inflation of 8%, while overall volumes declined by 3%. Price increases realised were insufficient to offset the impact of significantly higher raw material costs, resulting in operating income declining by 14% to R1,2 billion and the operating margin compressing to 8,9% from 10,9%.

After a challenging start to the year, Milling and Baking enjoyed a reasonable recovery in the second half, driven predominantly by Maize, Bakeries and Sorghum-based products. Revenue from Milling and Baking increased by 5%, reflecting an overall volume decline of 3%. Operating income declined by 10% to R1,1 billion.

Despite the second half recovery, adverse category dynamics as well as constrained pricing amid volatile underlying raw material prices, resulted in a sub-optimal operating profit performance from Maize for the year. Bakeries continued to experience year-on-year margin compression driven by marginal volume losses, while the current operating environment did not allow for the full recovery of cost increases. Sorghum-based products experienced a particularly difficult period, largely due to the impact of restrictions imposed during the lockdown period.

Following a tough start to the year, Other Grains experienced a meaningful recovery in the second half, driven primarily by Jungle and Pasta. The second half recovery resulted in year-on-year revenue for the overall segment increasing by 5% to R4,0 billion, comprising price inflation of 7% and an overall volume decline of 2%. Volume declines were largely driven by Rice due to above-inflationary price increases caused by significantly higher raw material costs. Pasta volumes, on the other hand, benefited in the second half from increased at-home consumption, supported by a marked improvement in factory performance. Similarly, increased demand in the breakfast category resulted in an improved overall performance from Jungle.

The increased promotional activity in the Rice category at the start of the year coupled with pricing regulation constraints, was the primary reason for operating income in Other Grains declining by 43% to R114 million.

Financial highlights



2019: R13,2 billion




Operating income
2019: R1,4 billion

Revenue by division

Revenue by division

Performance summary

Maize, Bakeries and Sorghum-based products report a second half recovery
Cost recovery in bread challenged offset by market share gains
Promotional campaigns and packaging relaunch in Jungle well received
Pasta benefits from increased at-home consumption in H2
Adverse category dynamics persist in Maize
Significant fluctuations in raw material costs difficult to pass through in Rice

Operating facilities

Grains map


  • Milling and Baking (Bakeries)


  • Milling and Baking

North West

  • Sorghum-based breakfast and beverages (Potchefstroom)

Free State

  • Milling and Baking


  • Milling and Baking (Bakeries and milling)
  • Other Grains (Rice)

Western Cape

  • Milling and Baking
  • Other Grains (Jungle)