TIDMZAM
RNS Number : 0252P
Zambeef Products PLC
15 June 2022
15 June 2022
Zambeef Products plc
("Zambeef" or the "Group")
Interim results for the Half Year Ended 31 March 2022
Zambeef (AIM: ZAM), the fully integrated cold chain foods and
retail business with operations in Zambia, Nigeria and Ghana, today
announces its results for the half-year ended 31 March 2022.
Financial Highlights
Figures in 000's 2022 2021 % 2022 2021 %
ZMW ZMW USD USD
------------ ------------- ---------- ---------
Revenue 2,568,680 2,150,473 19.4% 148,136 102,501 44.5%
Cost of sales (1,715,287) (1,411,049) 21.6% (98,921) (67,257) 47.1%
Gross profit 853,393 739,424 15.4% 49,215 35,244 39.6%
Administrative expenses (622,986) (584,654) 6.5% (35,928) (27,867) 28.9%
Operating profit 230,407 154,770 48.9% 13,287 7,377 80.1%
Profit from asset held
for sale 10,330 - 596 - -
Share of profit equity
accounted investment (1,287) (915) 40.7% (74) (44) 68.2%
Exchange losses 113 (42,558) 100.3% 7 (2,029) 100.3%
Finance costs (58,413) (56,360) 3.7% (3,369) (2,686) 25.4%
Profit before taxation 181,150 54,937 229.7% 10,447 2,618 299.0%
Taxation charge (33,587) (21,846) 53.7% (1,937) (1,041) 86.1%
Profit for the period
from continued operations 147,563 33,091 345.9% 8,510 1,577 439.6%
Profit from discontinued
operations - 20,843 - - 993 -
Total profit for the
period 147,563 53,934 173.6 8,510 2,570 231.1%
EBITDA 310,422 193,398 60.51% 17,902 9,217 94.2%
-------------------------------- ------------ ------------- ------- ---------- --------- -----------
Gross Profit Margin 33.2% 34.4% 33.2% 34.4%
EBITDA Margin 12.1% 9.0% 12.1% 9.0%
Debt/Equity (Gearing) 14.9% 25.4% 14.92% 25.43%
Debt-To-EBITDA 1.91 5.19% 1.83 4.93
------------ ------------- ------- ---------- --------- -----------
PERFORMANCE OVERVIEW
The period saw relative macroeconomic stability with the kwacha
appreciating relative to the US Dollar and inflation on a steady
downward trajectory. However, input costs to our livestock division
increased as a result of increasing commodity prices and fuel
costs. Together with a tight monetary policy, this resulted in
constrained consumer spending which affected the demand for our
products.
However, the Group posted results that were ahead of market
expectations (with this improved performance being notified in the
Company's Trading Update announcement of 27 April 2022), driven by
good performance in our cropping and stockfeed division and
continued focus on cost control. Market share gains and increased
Layer feed prices in our stock feed business resulted in increased
profitability and sustained margins.
Zambeef's chain of 237 retail outlets, both own-brand and within
Shoprite supermarkets, remain at the heart of the business, with
demand from consumers driving supply.
KEY FINANCIAL HIGHLIGHTS
Revenue measured in at ZMW2.6 billion (USD148.1 million) with a
gross profit of ZMW853.4 million (USD49.2 million), a growth of 19%
and 15% when compared to the previous corresponding period in
kwacha terms as well as 45% and 40% in USD terms respectively.
The Group's topline performance was due to performance in
Cropping and Stockfeed. Higher grain prices, stockfeed market share
gains and good farming interventions enabled the business to post
profitability. Cost pressures stemming from covid related global
supply chain desruptions, fuel costs and subdued demand on our
protein products resulted in margin erosion.
Management continued the cost optimisation agenda through
streamlining administrative costs while the continued direct cost
control measures helped deliver strong operating profit
leverage.
The Group combined strength as a diversified and vertically
integrated business with strong brands, supportive partners and an
experienced management team continues to be a major factor on the
sustained profitability of the Group.
Commenting on these results, Mr Michael Mundashi said:
"The Group faced margin pressure arising from a rise in input
costs such as Soya and energy across our value chains. However, our
diversified portfolio of brands and vertically integrated
businesses ensured the impact is balanced across the divisions,
thereby enabling the overall growth in Group profitability.
The Board believes the key to sustainable growth lies in
remaining committed to its strategic priorities, while mitigating
the effects of dynamic economic and climate cycles. As such, the
focus remains to invest in growth and optimisation opportunities
and invest in our core businesses and the divestiture of non-core
businesses. The vertical and horizontal integrated business
structure remains essential to sustained profitability growth and
balancing economic and climatic cyclicity.
"We anticipate macro-economic stability for Zambia to continue
over the medium term supported by improved investor sentiment,
elevated copper prices and the possibility of an International
Monetary Fund supported debt management program. The kwacha is
expected to remain relatively stable supported by increased mining
output.
The copper price, which is a major foreign exchange earner for
the country, is expected to continue holding as the global economy
continues to recover from the Covid-19 related shocks. The
inflation rate is expected to continue on the downward trajectory,
although the outcome of the Russo-Ukrainian tensions will lead to
further rises in global food and energy prices which still pose a
risk of higher inflation locally. The world at large and Zambia in
particular, have acclimatised to living with the Covid-19 pandemic.
Therefore, we expect Covid-19 related shocks to the business and
the economy to remain minimal."
For further information, please visit www.zambeefplc.com or
contact:
Zambeef Products plc Tel: +260 (0) 211 369003
Walter Roodt, Chief Executive Office
Faith Mukutu, Chief Financial Officer
finnCap (Nominated Adviser and Broker) Tel: +44 (0) 20 7220 0500
Ed Frisby/Tim Harper (Corporate Finance)
Tim Redfern/Barney Hayward (ECM)
Autus Securities Limited Tel: +260 (0) 761 002 002
Mataka Nkhoma
About Zambeef Products Plc
Zambeef Products Plc is the largest integrated cold chain food
products and agribusiness company in Zambia and one of the largest
in the region, involved in the primary production, processing,
distribution and retailing of beef, chicken, pork, milk, eggs,
dairy products, fish, flour and stockfeed, throughout Zambia and
the surrounding region, as well as Nigeria and Ghana.
It has 236 retail outlets throughout Zambia and West Africa.
The Company is one of the largest suppliers of beef in Zambia.
Five beef abattoirs and three feedlots are located throughout
Zambia, with a capacity to slaughter 230,000 cattle a year. It is
also one of the largest chicken and egg producers in Zambia, with a
capacity of 8.8m broilers and 22.4 million day-old chicks a year.
It is one of the largest piggeries, pig abattoirs and pork
processing plants in Zambia, with a capacity to slaughter 75,000
pigs a year, while its dairy has a capacity of 120,000 litres per
day.
The Group is also one of the largest cereal row cropping
operations in Zambia, with approximately 7,787 hectares of row
crops under irrigation, which are planted twice a year, and a
further 8,694 hectares of rainfed/dry-land crops available for
planting each year.
CHAIRMAN'S REPORT
Dear Shareholder,
It is my great pleasure to present to you the Chairman's Report
with respect to the half year ended 31 March, 2022.
The period saw relative macroeconomic stability with the kwacha
appreciating relative to the US Dollar and inflation on a steady
downward trajectory. However, input costs to our livestock division
increased as a result of increasing commodity prices and fuel
costs. Together with a tight monetary policy, this resulted in
constrained consumer spending which affected the demand for our
products. Despite these headwinds, the Group posted results that
were ahead of market expectations (with this improved performance
being notified in the Company's Trading Update announcement of 27
April 2022), driven by good performance in our cropping and
stockfeed division and continued focus on cost control.
The Group faced margin pressure arising from a rise in input
costs such as Soya and energy across our value chains. However, our
diversified portfolio of brands and vertically integrated
businesses ensured the impact is balanced across the divisions,
thereby enabling the overall group to profitability growth.
The Group generated an operating profit, including profit from
asset held for sale, of ZMW240.7 million (USD13.8 million) compared
to ZMW175.6million (USD8.4 million) in the prior financial year.
The operating profit, excluding profit from asset held for sale,
was ZMW230.4 million (USD13.3 million) compared to ZMW154.8 million
(USD7.4 million) achieved in the previous financial year. Profit
before tax was ZMW181.1 million (USD10.4 million) compared to
ZMW54.9 million (USD2.6 million) achieved in the prior financial
year. The Group's performance in the face of headwinds illustrates
the strengths of our vertically integrated business model, the
strength of our brands and a good management team.
The Board believes the key to sustainable growth lies in
remaining committed to its strategic priorities, while mitigating
the effects of dynamic economic and climate cycles. As such, the
focus remains to invest in growth and optimisation opportunities
and invest in our core businesses and the divestiture of non-core
businesses. The vertical and horizontal integrated business
structure remains essential to sustained profitability growth and
balancing economic and climatic cyclicity.
The Economic Environment
The Zambian economy saw signs of macroeconomic recovery,
following the successful general elections which resulted in
positive market sentiments and a positive economic outlook. The
Zambian kwacha remained relatively stable, with elements of
volatility being seen at the end of both the first and second
quarters. The strength of the currency was supported by foreign
participation in the bond market and a higher copper price on the
international commodity market.
Despite recovery in the global economy, the Zambian economic
recovery remains gradual, given the high debt burden and reduced
consumer spending.
Inflationary pressures, particularly food inflation, had
resulted in a significant drop in our customers' disposable income
and has continued to put pressure on the consumers' share of wallet
going towards food spend. However, inflation continued on the
downward trend for the period under review closing at 13.1%
compared to 22.8% for the previous financial year, supported mainly
by a reduction in food inflation rates as it came off a high base
from the previous year. This however did not offset steep cold
chain foods sales volume losses for the half-year period.
Retail and Cold Chain Food Products
Revenue in the Retail and Cold Chain Food business grew by 11%
to ZMW2.6 billion with operating profit growth of 26% to ZMW96
million, supported by sustained revenue management and cost control
in light of margin pressure due to a reduction in demand in the
face of rising input costs.
Rising global food prices, particularly grain, precipitated in
high animal feed costs. As a result, the division saw margin
pressures across most protein categories as feed is a significant
cost in primary protein production.
The Poultry business saw demand reduction owing to sustained
chicken price escalations, which resulted in consumers downgrading
to cheaper protein sources. Management has responded and
implemented measures that are expected to see a recovery in the
second half-year period.
Cropping and Milling (Cropping, Stockfeed and Wheat Milling)
Zambia experienced a late onset to the summer rainfall season,
and as a result, yields for the summer crop declined. However,
favourable grain prices deliver strong growth.
The first quarter resulted in below expected stockfeed sales
volumes with the second quarter showing strong gains in market
share due to Stockfeed strong raw material position.
Debt reduction
During the half year period, the Group continued to deleverage
by making repayments on debt obligations as they became due and
utilising the internally generated cash to reduce our short-term
debt. Net debt for the half year period closed at ZMW 592 million
(USD33million) from ZMW 715 million (USD46million) as at 30
September 2021. The resultant balance sheet positions the Group
with capacity to finance efficiency upgrades and production
capacity expansion.
The steps that management took in 2021, to restructure the
Company's debt profile by replacing the majority USD debt with
kwacha debt to match the primary revenue base currency to the
Company's debt service profile is beginning to yield results. We
now have greater certainty of committed debt repayment amounts
which has resulted in significantly reduced exchange rate
risks.
Outlook
We anticipate macro-economic stability for Zambia to continue
over the medium term supported by improved investor sentiment,
elevated copper prices and the possibility of an International
Monetary Fund supported debt management program. The kwacha is
expected to remain relatively stable supported by increased mining
output.
The copper price, which is a major foreign exchange earner for
the country, is expected to continue holding as the global economy
continues to recover from the Covid-19 related shocks. The
inflation rate is expected to continue on the downward trajectory,
although the outcome of the Russo-Ukrainian tensions will lead to
further rises in global food and energy prices which still pose a
risk of higher inflation locally. The world at large and Zambia in
particular, have acclimatised to living with the Covid-19 pandemic.
Therefore, we expect Covid-19 related shocks to the business and
the economy to remain minimal.
The Group remains committed to delivering value to shareholders
and is well positioned to navigate the turmoil while capitalising
on opportunities.
Strategy
Following the strategy reset process of 2021, I am happy to
report that the board remains committed to and is on track in
implementing the strategic imperatives. The following are the
pillars on which the five year strategy was underpinned:
-- Focus and strengthen our core business by investing in
capacity and grow market share
-- Divestiture of non-core assets to free up resources
-- Develop a human capital strategy that aligns with business
objectives
-- Strengthen our strategic partnerships
-- Enhancement of shareholders value
Acknowledgement
On behalf of the Company and the Board of Directors, I would
like to express my sincere gratitude to Yollard Kachinda and Frank
Braeken who resigned from the board on 14 April 2022 and 27 May,
2022, respectively. Their dedication and contributions to the
business during the period they served as directors will be greatly
missed.
I also thank my fellow board members for steering the Group
through the first half of the year and positioning it for the next
phase of growth. To our management and staff, I express my
gratitude to them for another solid performance, dedicated efforts
and resilience in the face of challenges. I am proud of our
achievements to date and I am excited by the potential
opportunities upon which we will build our future progress.
Michael Mundashi
Chairman
15 June 2022
CHIEF EXECUTIVE OFFICER'S REVIEW
Overview
Despite the 2022 half-year period being characterised by
difficult trading conditions, the Group results exceeded market
expectations, as previously announced, due to the performance in
the Cropping and Milling division. Higher grain prices and
Stockfeed market share gains enabled the business to post strong
profits. However, in light of the macroeconomic fundamentals
stabilising, the reduced consumer spend on the back of a rise in
input costs put pressure on volumes and margins in the Retail and
Cold Chain Food Products (CCFP) segment. The increase in raw
material input costs, such as soya and wheat, negatively impacted
primary protein and milling production costs with the consequent
increase in food prices to our customers resulting in reduced
demand for our products as customers traded down, particularly in
the first quarter of the financial year. The second quarter saw a
slight volume recovery in the Retail and CCFP segments as
management responded to the changing commercial environment.
The Group posted revenue, including from assets held for sale,
of ZMW2.6 billion (USD150 million) and we achieved a gross profit
of ZMW884 million (USD51 million), being 16% and 13% above the
prior year in kwacha terms, and 40% and 37% growth in USD terms,
respectively.
The Group's strong performance was driven by the Cropping and
Milling division. Management continued optimising top line growth
through revenue management initiatives while the continued cost
control measures helped deliver a robust operating profit
performance.
Our diversified and vertically integrated business with strong
brands, supportive partners and an experienced management team
helped deliver encouraging results during the first half-year of
the 2022 reporting period.
Strategic focus
Our strategic focus remains to optimise our asset utilisation
and maximise returns. We remain committed to focusing on our
existing core businesses, in which we strive to be the best in
class, continued divesture of non-core assets and a fit for purpose
people strategy. As part of delivering on our strategic
imperatives, the business will progressively turn towards capacity
expansion opportunities across our business, which will see
increased profitability in the medium to long term.
Outlook
The macroeconomic environment is expected to remain stable. The
successful holding of general elections on 12 August 2021 and the
resultant change in government during a peaceful transition of
power has brought investor confidence and optimism. The consequent
appreciation of the kwacha continued during the half year as
foreign direct investment prospects improved. This coupled with
high copper prices, a potential International Monetary Fund (IMF)
Country program and reliable electricity supply has improved the
country's economic outlook. We expect a continued slowdown in
inflation and reduced interest rates. As a result, we look forward
to increased economic activity translating into sustained
macroeconomic stability.
Our strong brands will help us maintain customer loyalty while
the vertically integrated business model positions us well to
secure both supply and a market for our products. The future
recovery in the economy and a strong management team have
positioned us well for improved stakeholder value creation in the
coming years.
The Russo-Ukraine conflict poses risks but at the same time
presents opportunities for our business. The consequent rise in
input costs such as fertiliser and energy could negatively impact
our profitability while the rise in commodity prices, such as wheat
and soya, will benefit our Cropping and Milling division.
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CHIEF EXECUTIVE OFFICER'S REVIEW (CONTINUED)
Divisional Performance
Table 1 (ZMW) and Table 2 (USD) below provide a summary of the
consolidated performance of the key business divisions reported at
an operating profit level.
Table 1: Divisional financial summary in ZMW'000
ZMW Revenue Gross Profit Overheads Operating Profit
2022 2021 2022 2021 2022 2021 2022 2021
Division ZMW'000 ZMW'000 ZMW'000 ZMW'000 ZMW'000 ZMW'000 ZMW'000 ZMW'000
---------- ------------ ------------ ------------ ------------ ------------ -------------- ----------- ----------
Retail
&
CCFP 2,631,327 2,367,486 399,734 387,745 (303,646) (311,636) 96,088 76,109
---------- ------------
Cropping
&
Milling 1,382,510 1,032,887 453,659 351,679 (200,580) (182,289) 253,079 169,390
---------- ------------ ------------ ------------ ------------ ------------ -------------- ----------- ----------
Total 4,013,837 3,400,373 853,393 739,424 (504,226) (493,925) 349,167 245,499
---------- ------------ ------------ ------------ ------------ ------------ -------------- ----------- ----------
Less:
Intra/
Inter
Group (1,445,157) (1,249,900) - - - - -
Sales
------------ ------------ ------------ ------------ ------------ -------------- ----------- ----------
Central
------------ ------------ ------------ ------------
Overhead (118,760) (90,729) (118,760) (90,729)
---------- ------------ ------------ ------- --- ----- ----- ------------ -------------- ----------- ----------
Group
Total 2,568,680 2,150,473 853,393 739,424 (622,986) (584,654) 230,407 154,770
---------- ------------ ------------ ------------ ------------ ------------ -------------- ----------- ----------
Table 2: Divisional financial summary in USD'000
USD Revenue Gross Profit Overheads Operating Profit
2022 2021 2022 2021 2022 2021 2022 2021
Division USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000 USD'000
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
Retail & 151,748 112,845 23,053 18,481 (17,512) (14,853) 5,541 3,628
CCFP
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
Cropping
& Milling 79,730 49,232 26,162 16,763 (11,567) (8,689) 14,595 8,074
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
Total 231,478 162,077 49,215 35,244 (29,079) (23,542) 20,136 11,702
============== ========== ========== ========= ========= =========== ========== ========= =========
Less: Intra/
--------- --------- ----------- ---------- --------- ---------
Inter Group (83,342) (59,576)
--------- --------- ----------- ---------- --------- ---------
Sales
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
Central
---------- ---------- --------- ---------
Overhead (6,849) (4,325) (6,849) (4,325)
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
Group Total 148,136 102,501 49,215 35,244 (35,928) (27,867) 13,287 7,377
-------------- ---------- ---------- --------- --------- ----------- ---------- --------- ---------
ZAMBE EF PRODUCTS PLC AND ITS SUBSIDIARIES
CHIEF EXECUTIVE OFFICER'S REVIEW (CONTINUED)
Taking the performance of each of our key business areas in
turn:
Retail and Cold Chain Food Products
Sales volumes came under pressure on the back of input price
increases that reduced consumer spending on proteins and oils and
resulting in the trading down to cheaper nutritional alternatives.
The resulting strong supply situation across all protein categories
necessitated price reductions in the second quarter which started
to contribute to a volume recovery. March 2022 saw the outbreak of
African Swine Fever in Lusaka Province which resulted in our pork
processing operation being shut down and therefore started to
impact on volumes. Chicken sales volumes struggled as the price of
chicken products remained relatively high compared with other
proteins due to sustained high feed prices.
Despite the challenges, the Retail and CCFP business registered
a revenue growth of 11% above the prior year. However, higher input
prices, particularly feed and fuel, resulted in margin erosion,
thereby posting gross profit growth of only 3%.
The Retail and CCFP division generated an EBIT margin of 3.7%
which increased by 43.9 basis points from the previous financial
year to ZMW96 million (2021: ZMW76 million) in kwacha terms and
grew impressively by 53% to USD5.5 million (2021: USD3.6 million)
in dollar terms. Overhead spend discipline ensured strong operating
profit leverage. Reduced load shedding helped lower fuel costs of
running our electricity generators, which further contributed to
the increased profitability.
Cropping and Milling (Cropping, Stockfeed and Wheat Milling)
The summer farming season started off poorly due to the delay in
the onset of summer rains which impacted on summer crop yields.
However, high world grain prices enabled the business to post
better than expected results.
The Stockfeed milling business was a major contributor to
profitability in the division due to market share gains owing to
good sales and operations planning.
Revenue in the Cropping and Milling division grew by 34% in
kwacha terms and 62% in USD terms, while the operating profit grew
by 49% to ZMW 253 million (2021: ZMW169 million) or 81% to USD14.6
million (2021: USD8.1 million) in dollar terms. Production costs
were impacted by rising costs of inputs, particularly fertiliser
and other inputs.
Walter Roodt
Chief Executive Officer
15 June 2022
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE SIX MONTH PERIODED 31 MARCH 2022
Unaudited Audited
31 Mar 2022 31 Mar 2021 30 Sept 2021
------------ ------------ ------------------------
Group ZMW'000s ZMW'000s ZMW'000s
------------ ------------ ------------------------
Revenue 2,568,680 2,150,473 4,974,351
------------ ------------ ------------------------
Net profit arising from
price changes in fair
value of biological assets 5,273 17,242 6,651
------------ ------------ ------------------------
Cost of sales (1,720,560) (1,428,291) (3,510,286)
------------ ------------ ------------------------
Gross profit 853,393 739,424 1,470,716
------------ ------------ ------------------------
Administrative expenses (597,097) (554,461) (1,150,658)
------------ ------------ ------------------------
Distribution costs (29,850) (33,114) (66,848)
------------ ------------ ------------------------
Other income 3,961 2,921 14,120
------------ ------------ ------------------------
Operating profit 230,407 154,770 267,330
------------ ------------ ------------------------
Share of loss equity accounted
investment (1,287) (915) (3,358)
------------ ------------ ------------------------
Profit from asset held
for sale 10,330 - 31,949
------------ ------------ ------------------------
Exchange gains/(losses)
on translating foreign
currency transactions
and balances 113 (42,558) 23,332
------------ ------------ ------------------------
Finance costs (58,413) (56,360) (115,282)
------------ ------------ ------------------------
Profit before taxation 181,150 54,937 203,971
------------ ------------ ------------------------
Taxation charge (33,587) (21,846) (35,148)
------------ ------------ ------------------------
Profit/(loss) for the
period from continued
operations 147,563 33,091 168,823
------------ ------------ ------------------------
Profit from discontinued
operations - 20,843 -
------------ ------------ ------------------------
Total profit for the
period 147,563 53,934 168,823
------------ ------------ ------------------------
Profit/(loss) attributable
to:
------------ ------------ ------------------------
Equity holders of the
parent 146,754 54,056 167,980
------------ ------------ ------------------------
Non-controlling interest 809 (122) 843
------------ ------------ ------------------------
147,563 53,934 168,823
------------ ------------ ------------------------
Other comprehensive income
------------ ------------ ------------------------
Exchange gains/(losses)
on translating presentational
currency (28,156) 117,226 (286,645)
------------ ------------ ------------------------
Remeasurement of net defined
benefit liability - - (2,813)
------------ ------------ ------------------------
Revaluation of assets - - 192,403
------------ ------------ ------------------------
Total other comprehensive
income 119,407 117,226 (97,055)
------------ ------------ ------------------------
Total comprehensive income
for the period 119,407 171,160 71,768
------------ ------------ ------------------------
Total comprehensive income
for the period attributable
to:
------------ ------------ ------------------------
Equity holders of the
parent 121,786 173,523 73,867
------------ ------------ ------------------------
Non-controlling interest (2,379) (2,363) (2,099)
------------ ------------ ------------------------
119,407 171,160 71,768
------------ ------------ ------------------------
Earnings per share Ngwee Ngwee Ngwee
------------ ------------ ------------------------
Basic earnings per share
from continued operations 45.39 11.05 55.89
------------ ------------ ------------------------
Basic earnings per share
from discontinued operations 3.44 6.93 -
------------ ------------ ------------------------
Total 48.83 17.98 55.89
------------ ------------ ------------------------
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE
INCOME
FOR THE SIX MONTH PERIODED 31 MARCH 2022
Unaudited Audited
31 Mar 2022 31 Mar 2021 30 Sept 2021
------------ ------------ -------------
Group USD'000s USD'000s USD'000s
------------ ------------ -------------
Revenue 148,136 102,501 235,528
------------ ------------ -------------
Net proft arising from price
changes in fair value of
biological assets 304 822 315
------------ ------------ -------------
Cost of sales (99,225) (68,079) (166,207)
------------ ------------ -------------
Gross profit 49,215 35,244 69,636
------------ ------------ -------------
Administrative expenses (34,435) (26,428) (54,482)
------------ ------------ -------------
Distribution costs (1,721) (1,578) (3,165)
------------ ------------ -------------
Other income 228 139 669
------------ ------------ -------------
Operating profit 13,287 7,377 12,658
------------ ------------ -------------
Share of loss equity accounted
investment (74) (44) (160)
------------ ------------ -------------
Profit from asset held for
sale 596 - 1,513
------------ ------------ -------------
Exchange gains/(losses)
on translating foreign currency
transactions and balances 7 (2,029) 1,105
------------ ------------ -------------
Finance costs (3,369) (2,686) (5,458)
------------ ------------ -------------
Profit before taxation 10,447 2,618 9,658
------------ ------------ -------------
Taxation charge (1,937) (1,041) (1,663)
------------ ------------ -------------
Profit/(loss) for the period
from continued operations 8,510 1,577 7,995
------------ ------------ -------------
Profit from asset held for
sale - 993 -
------------ ------------ -------------
Total profit for the period 8,510 2,570 7,995
------------ ------------ -------------
Profit/(loss) attributable
to:
------------ ------------ -------------
Equity holders of the parent 8,463 2,577 7,955
------------ ------------ -------------
Non-controlling interest 47 (7) 40
------------ ------------ -------------
8,510 2,570 7,995
------------ ------------ -------------
Other comprehensive income
------------ ------------ -------------
Exchange (losses)/gains
on translating presentational
currency (18,552) (11,265) 25,338
------------ ------------ -------------
Remeasurement of net defined
benefit liability - - (133)
------------ ------------ -------------
Revaluation of assets - - 9,110
------------ ------------ -------------
Total other comprehensive
income (18,552) (11,265) 34,315
------------ ------------ -------------
Total comprehensive income
for the period (10,042) (8,695) 42,310
------------ ------------ -------------
Total comprehensive income
for the period attributable
to:
------------ ------------ -------------
Equity holders of the parent (9,921) (8,581) 42,440
------------ ------------ -------------
Non-controlling interest (121) (114) (130)
------------ ------------ -------------
(10,042) (8,695) 42,310
------------ ------------ -------------
Earnings per share Cents Cents Cents
------------ ------------ -------------
Basic earnings per share
from continued operations 2.62 0.53 2.65
------------ ------------ -------------
Basic earnings per share
from discontinued operations 0.20 0.33 -
------------ ------------ -------------
Total 2.82 0.86 2.65
------------ ------------ -------------
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 31 MARCH 2022
Total
Foreign attributable
Preference exchange to owners
Share Share share Revaluation translation Retained of the Non-controlling Total
capital premium capital reserve reserve earnings parent interest equity
ZMW'000s ZMW'000s ZMW'000s ZMW'000s ZMW'000s ZMW'000s ZMW'000s ZMW'000s ZMW'000s
At 1 October
2020 3,006 1,125,012 1,000 1,167,713 1,003,834 470,174 3,770,739 (520) 3,770,219
Loss for the
period - - - - - 54,056 54,056 (122) 53,934
Transfer of
surplus
depreciation - - - (23,141) - 23,141 - - -
Other
comprehensive
income:
Exchange gains
on translating
presentational
currency - - - - 119,467 - 119,467 (2,241) 117,226
Total
comprehensive
income
for the period - - - (23,141)) 119,467 77,197 173,523 (2,363) 171,160
At 31 March
2021 3,006 1,125,012 1,000 1,144,572 1,123,301 547,371 3,944,262 (2,883) 3,941,379
Profit for the
period - - - - - 113,924 113,924 965 114,889
Transfer of
surplus
depreciation - - - (21,236) - 21,236 - - -
Other
comprehensive
income
Revaluation - - - 192,403 - - 192,403 - 192,403
Remeasurement
of net defined
benefit
liability - - - - - (2,813) (2,813) - (2,813)
Exchange gains
on translating
presentational
currency - - - - (403,170) - (403,170) (701) (403,871)
Total
comprehensive
income
for the period - - - 171,167 (403,170) 132,347 (99,656) 264 (99,392)
At 30 September
2021 3,006 1,125,012 1,000 1,315,739 720,131 679,718 3,844,606 (2,619) 3,841,987
Profit for the
period - - - - - 146,754 146,754 809 147,563
Transfer of
surplus
depreciation - - - (25,711) - 25,711 - - -
Other
comprehensive
income
Exchange gains
on translating
presentational
currency - - - - (24,968) - (24,968) (3,188) (28,156)
Total
comprehensive
income
for the period - - - (25,711) (24,968) 172,465 121,786 (2,379) 119,407
At 31 March
2022 3,006 1,125,012 1,000 1,290,028 695,163 852,183 3,966,392 (4,998) 3,961,394
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTH PERIODED 31 MARCH 2022
Total
Foreign attributable
Preference exchange to owners
Share Share share Revaluation translation Retained of the Non-controlling Total
capital premium capital reserve reserve earnings parent Interest equity
USD'000s USD'000s USD'000s USD'000s USD'000s USD'000s USD'000s USD'000s USD'000s
At 1 October
2020 449 185,095 100 171,271 (250,418) 80,729 187,226 (26) 187,200
Transactions
with owners
Profit for the
period - - - - - 2,577 2,577 (7) 2,570
Transfer of
surplus
depreciation - - - (1,103) - 1,103 - - -
Other
comprehensive
income:
Exchange losses
on translating
presentational
currency - - - - (11,158) - (11,158) (107) (11,265)
Total
comprehensive
income
for the period - - - (1,103) (11,158) 3,680 (8,581) (114) (8,695))
At 31 March
2021 449 185,095 100 170,168 (261,576) 84,409 178,645 (140) 178,505
Profit for the
period - - - - - 5,378 5,378 47 5,425
Transfer of
surplus
depreciation - - - (998) - 998 - - -
Revaluation - - - 9,110 - - 9,110 - 9,110
Other
comprehensive
income
Remeasurement
of defined
benefit
liability - - - - - (133) (133) (133)
Exchange gains
on translating
presentational
currency - - - - 36,666 - 36,666 (63) 36,603
Total
comprehensive
income - - - 8,112 36,666 6,243 51,021 16 51,005
At 30 September
2021 449 185,095 100 178,280 (224,910) 90,652 229,666 (156) 229,510
Profit for the
period - - - - - 8,463 8,463 47 8,510
Transfer of
surplus
depreciation - - - (1,483) - 1,483 - - -
Other
comprehensive
income
Exchange gains
on translating
presentational
currency - - - - (18,384) - (18,384) (168) (18,552)
Total
comprehensive
income - - - (1,483) (18,384) 9,946 (9,921) (121) (10,042)
At 31 March
2022 449 185,095 100 176,797 (243,294) 100,598 219,745 (277) 219,468
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION -- 31 MARCH
2022
Unaudited Audited
31 Mar 2022 31 Mar 2021 30 Sept 2021
ZMW'000s ZMW'000s ZMW'000s
ASSETS
Non - current assets
Goodwill 166,801 166,801 166,801
Property, plant and equipment 3,092,010 3,419,935 3,115,018
Investment in associate 39,181 42,911 40,468
Deferred tax assets 16,305 8,680 9,050
3,314,297 3,638,327 3,331,337
Current assets
Biological assets 718,383 689,646 358,997
Inventories 972,887 906,914 1,197,846
Trade and other receivables 187,309 149,606 234,076
Assets held for disposal 167,577 175,654 170,550
Amounts due from related
companies 3,484 4,949 4,202
Income tax recoverable 994 19,800 3,707
Cash and Cash equivalents 226,654 83,678 201,539
2,277,288 2,030,247 2,170,917
Total assets 5,591,585 5,668,574 5,502,254
EQUITY AND LIABILITIES
Capital and reserves
Share capital 3,006 3,006 3,006
Preference share capital 1,000 1,000 1,000
Share premium 1,125,012 1,125,012 1,125,012
Reserves 2,837,374 2,815,244 2,715,588
3,966,392 3,944,262 3,844,606
Non-controlling interest (4,998) (2,883) (2,619)
3,961,394 3,941,379 3,841,987
Non - current liabilities
Interest bearing liabilities 146,667 124,233 195,555
Leases 3,797 10,242 7,253
Deferred liability 7,845 10,578 8,891
Deferred taxation 94,229 85,041 88,056
252,538 230,094 299,755
Current liabilities
Interest bearing liabilities 239,231 359,159 210,709
Leases 6,012 16,446 12,418
Trade and other payables 483,404 400,006 464,103
Provisions 197,491 120,857 169,307
Taxation payable 28,864 23,940 13,771
Bank overdrafts 422,651 576,693 490,204
1,377,653 1,497,101 1,360,512
Total equity and liabilities 5,591,585 5,668,574 5,502,254
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF FINANCIAL POSITION -- 31 MARCH
2022
Unaudited Audited
30 Sept
31 Mar 2022 31 Mar 2021 2021
USD '000s USD '000s USD '000s
ASSETS
Non - current assets
Goodwill 9,241 7,554 9,964
Property, plant and equipment 171,302 154,888 186,082
Investment in associate 2,170 1,943 2,417
Deferred tax asset 903 394 541
183,616 164,779 199,004
Current assets
Biological assets 39,800 31,234 21,445
Inventories 53,900 41,074 71,556
Trade and other receivables 10,377 6,776 13,983
Assets held for disposal 9,284 7,955 10,188
Amounts due from related
companies 193 224 251
Income tax recoverable 55 897 221
Cash and Cash equivalents 12,557 3,790 12,039
126,166 91,950 129,683
Total assets 309,782 256,729 328,687
EQUITY AND LIABILITIES
Capital and reserves
Share capital 449 449 449
Preference share capital 100 100 100
Share premium 185,095 185,095 185,095
Reserves 34,101 (6,999) 44,022
219,745 178,645 229,666
Non-controlling interest (277) (140) (156)
219,468 178,505 229,510
Non - current liabilities
Interest bearing liabilities 8,126 5,626 11,682
Leases 210 464 433
Deferred liability 435 479 531
Deferred tax liability 5,220 3,852 5,260
13,991 10,421 17,906
Current liabilities
Interest bearing liabilities 13,254 16,266 12,587
Leases 333 745 742
Trade and other payables 26,780 18,116 27,723
Provisions 10,941 5,474 10,113
Taxation payable 1,599 1,084 823
Bank overdrafts 23,416 26,118 29,283
76,323 67,803 81,271
Total equity and liabilities 309,782 256,729 328,687
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTH PERIODED
31 MARCH 2022
Audited
6 months 6 months
to to Year to
31 Mar 30 Sept
31 Mar 2022 2021 2021
ZMW'000s ZMW'000s ZMW'000s
Cash inflow/(outflow) from
Operating
activities
Profit before taxation 181,150 54,937 203,971
Finance costs 58,413 56,360 115,282
Loss on disposal of property, plant
and equipment 3,756 (1,345) 2,260
Depreciation 60,576 84,275 160,471
Share of loss of equity accounted
investment 1,287 915 3,358
Profit from asset held for sale - 20,843 -
Fair value price adjustment on
biological
assets (5,273) (17,242) (6,651)
Defined benefits liability movement - - 4,473
Defined benefits paid - - (6,971)
Net unrealised foreign exchange
losses/(gains) 10,513 (5,345) (19,422)
Earnings before interest, tax,
depreciation and amortisation,
fair
value adjustments and net
unrealised
foreign exchange losses 310,422 193,398 456,771
(Increase)/decrease in biological
assets (354,113) (496,099) (176,041)
Decrease in inventory 224,959 196,726 (94,206)
Decrease in trade and other
receivables 46,767 (16,938) (101,408)
Decrease in amounts due from
related
companies 718 4,388 5,135
Decrease in trade and other
payables
and provisions 47,485 85,868 198,415
Increase in amount due to related
companies - (443) (443)
(Decrease)/increase in deferred
liability (1,046) (811) -
Income tax paid (16,863) - (4,734)
Net cash inflow/(outflow) from
operating activities 258,329 (33,911) 283,489
Investing activities
Purchase of property, plant and
equipment (62,652) (59,829) (116,629)
Proceeds from sale of assets 405 2,247 51
Net cash outflow from investing
activities (62,247) (57,582) (116,578)
Net cash inflow/(outflow) before
financing 196,082 (91,493) 166,911
Financing
Long term loans repaid (52,436) (81,925) (262,705)
Receipt from term loans - - 220,000
Repayment of short term funding (158,471) (228,246) (477,906)
Receipt of short term funding 101,000 232,646 449,619
Leases repaid (9,862) (16,321) (32,513)
Finance costs including
discontinued
operations (58,413) (56,360) (115,282)
Net cash outflow from financing (178,182) (150,206) (218,787)
Increase/(decrease) in cash and
cash equivalents 17,900 (241,699) (51,876)
Cash and cash equivalents at
beginning
of period (288,665) (236,909) (236,909)
Effects of exchange rate changes
on the balance of
cash held in foreign currencies 74,768 (14,407) 120
Cash and cash equivalents at end
of period (195,997) (493,015) (288,665)
Represented by:
Cash in hand and at bank 226,654 83,678 201,539
Bank overdrafts (422,651) (576,693) (490,204)
(195,997) (493,015) (288,665)
ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES
CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE SIX MONTH PERIOD
ENDED 31 MARCH 2022
Unaudited Audited
6 months 6 months
to to Year to
31 Mar 31 Mar 30 Sept
2022 2021 2021
USD'000s USD'000s USD'000s
Cash inflow/(outflow) from/(on) operating
activities
Profit before taxation 10,447 2,618 9,658
Finance costs 3,369 2,686 5,458
Loss on disposal of property, plant
and equipment 217 (64) 107
Depreciation 3,493 4,017 7,598
Share of loss of equity accounted
investment 74 44 160
Profit from discontinued operations - 993 -
Fair value price adjustment on biological
assets (304) (822) (315)
Defined benefits liability movement - - 212
Defined benefits paid - (330)
Net unrealised foreign exchange losses/(gains) 606 (255) (920)
Earnings before interest, tax, depreciation
and amortisation, fair value adjustments
and net unrealised foreign exchange
losses 17,902 9,217 21,628
Increase/(decrease) in biological
assets (20,422) (23,646) (8,335)
Decrease in inventory 12,973 9,377 (4,461)
Decrease in trade and other receivables 2,697 (807) (4,802)
Decrease in amounts due from related
companies 41 209 243
(Decrease) in trade and other payables 2,738 4,093 9,395
Increase in amount due to related
companies - (21) (21)
(Decrease) in deferred liability (60) (39) -
Income tax paid (972) - (224)
Net cash inflow/(outflow) from operating
activities 14,897 (1,617) 13,423
Investing activities
Purchase of property, plant and equipment (3,613) (2,852) (5,522)
Proceeds from sale of assets 23 107 2
Net cash outflow from investing activities (3,590) (2,745) (5,520)
Net cash inflow/(outflow) before
financing 11,307 (4,362) 7,903
Financing
Long term loans repaid (3,024) (3,820) (12,439)
Receipt from term loans - - 10,417
Repayment of short term funding (9,139) (10,773) (22,628)
Receipt of short term funding 5,825 10,952 21,289
Lease finance repaid (569) (778) (1,539)
Finance costs (3,369) (2,686) (5,458)
Net cash outflow from financing activities (10,276) (7,105) (10,358)
Increase/(decrease) in cash and cash
equivalents 1,031 (11,467) (2,455)
Cash and cash equivalents at beginning
of period (17,244) (11,763) (11,763)
Effects of exchange rate changes on
the balance of
cash held in foreign currencies 5,354 902 (3,026)
Cash and cash equivalents at end
of period (10,859) (22,328) (17,244)
Represented by:
Cash in hand and at bank 12,557 3,790 12,039
Bank overdrafts (23,416) (26,118) (29,283)
(10,859) (22,328) (17,244)
A copy of the Interim Report will shortly be available to view
on the Company's website at www.zambeefplc.com/aim-rule-26/
END
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IR BSGDLUBBDGDU
(END) Dow Jones Newswires
June 15, 2022 10:30 ET (14:30 GMT)
Zambeef Products (AQSE:ZAM.GB)
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