Rainbow Chicken, the South African poultry processor and majority owner of local food group Foodcorp, has warned its profits have slumped in its last financial year.

The company said yesterday (19 August) it expects its headline earnings per share – a key metric in South Africa – for the 12 months to the end of June to be down 80-100%.

Rainbow Chicken, which saw headline earnings fall 74% in the first half of its financial year, said “record levels” of poultry imports and high feed costs had “materially impacted” its chicken business.

It also cited transaction costs linked to its acquisition of 64% of Foodcorp, the owner of brands including Yum Yum peanut butter, Sunbake bread and Nola condiments, earlier this year.

Rainbow Chicken said the two months of results of Foodcorp from May had been negatively affected by the deterioration in the exchange rate, which had impacted the valuation of its new asset’s euro-denominated senior secured notes.

The company’s full annual results will be published next Tuesday.