Struggling poultry producer Daybreak Foods will cut more than 2 000 jobs as part of its business rescue plan, the company's senior business rescue practitioner, Teboho Maoto, announced on Wednesday.
Maoto, speaking during a radio interview on SAFM, said the mass retrenchment affected the majority of Daybreak's approximately 2 800-strong workforce, with only about 500 employees retained to maintain critical operations at the company's hatchery and breeder farms.
"We will be conducting a retrenchment process of over 2 000 employees. This is primarily to align the workforce with the current operational needs," said Maoto, acknowledging the harsh reality facing workers at the company that once generated R3 billion in annual revenue.
“Daybreak entered business rescue in May following severe financial challenges and animal cruelty accusations that resulted in mass chicken culling. The Public Investment Corporation has approved R150 million in emergency funding to support the rescue process,” he said.
Maoto said the job cuts formed part of a lean operations strategy as the company attempted to rebuild from its current position of generating barely R20 million per month.
He said the retrenchments had become a necessary step in the process to save the business, which had been plagued by financial irregularities, procurement misconduct, operational breakdown and infrastructure neglect over the years.
However, Maoto said affected employees could be redeployed as operations ramped up.
"We are not trying to be harsh to employees. We want to preserve jobs as much as we can."
Maoto said the business rescue plan was unfolding in three phases. The emergency phase has already preserved critical operations and achieved a net positive cash position of R21 million a month. The current reactivation phase focuses on restarting abattoir operations while implementing cost-cutting measures.
The final stabilisation phase will seek a strategic equity partner through a formal process, with binding offers expected by December and final agreements targeted for mid-2026.
Maoto said Daybreak had managed to restore production of over 800 000 chicks per week and stabilised labour relations after initial hostility when the business rescue process began.
He said the company faced additional challenges with non-compliant environmental and water use licences across its facilities, potentially delaying its full production restart by six to twelve months.
