| Fri 11 May 2007, 16:41 | | NSX - OCE - Oceana Group Limited - Interim Report |
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OCE
OCE
NSX - OCE - Oceana Group Limited - Interim Report and dividend declaration for
the six months ended 31 march 2007
OCEANA GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration Number 1939/001730/06)
JSE Share Code: OCE
ISIN Number: ZAE000025284
NSX Share Code: OCG
INTERIM REPORT AND
DIVIDEND DECLARATION
FOR THE SIX MONTHS ENDED
31 MARCH 2007
The unaudited results of the group for the six months ended 31 March 2007 are
set out herein.
This report has been prepared in compliance with International Financial
Reporting Standards (IFRS) applicable to Interim Financial Reporting (IAS34) and
in accordance with the principles applied in the most recently published Annual
Financial Statements.
Directors:
MA Brey (Chairman), RA Williams (Vice Chairman), AB Marshall* (Chief Executive
Officer), ABA Conrad*, N Dennis, NP Doyle, Z Fuphe, RG Nicol*,
S Pather, F Robertson (*Executive)
Company Secretary: JD Cole
Registered Office: 16th Floor, Metropolitan Centre, 7 Coen Steytler Avenue,
Cape Town 8001
Transfer Secretaries: Computershare Investor Services 2004 (Pty) Limited
70 Marshall Street, Johannesburg, 2001
(P.O. Box 61051, Marshalltown, 2107)
Sponsor: The Standard Bank of South Africa Limited
CONDENSED GROUP INCOME STATEMENT Unaudited Audited
six months ended year ended
31 March 30 Sept
2007 2006 Change 2006
Note R`000 R`000 % R`000
Revenue 1,136,345 1,197,087 (5) 2,544,558
Operating profit before
abnormal items 66,312 52,606 26 183,325
Abnormal items 1 2,962 710 (5,882)
Operating profit 69,274 53,316 30 177,443
Dividends received and accrued 7,816 422 6,151
Net interest received 5,334 15,420 23,340
Profit before taxation 82,424 69,158 19 206,934
Taxation 27,091 27,645 (2) 70,088
Profit after taxation 55,333 41,513 33 136,846
Attributable to:
Shareholders of Oceana Group Ltd 51,564 38,500 34 129,791
Outside shareholders in
subsidiaries 3,769 3,013 25 7,055
55,333 41,513 33 136,846
Weighted average number of
Shares on which earnings per
share are based (000`s) 2 100,764 113,036 113,099
Adjusted weighted average
number of shares on which
diluted earnings per share
are based (000`s) 100,921 113,358 113,426
Earnings per share (cents)
Basic 51.2 34.1 50 114.8
Diluted 51.1 34.0 50 114.4
Dividends per share (cents) 19.0 15.0 27 74.0
Headline earnings per share (cents)
Basic 46.7 33.2 40 112.8
Diluted 46.6 33.1 41 112.5
DIVIDEND DECLARATION
Notice is hereby given that an interim dividend No. 127 of 19.0 cents per share,
in respect of the year ending 30 September 2007, was declared on Friday 11 May
2007. Relevant dates are as follows:
Last day to trade cum dividend - Friday 22 June 2007.
Commence trading ex dividend - Monday 25 June 2007.
Record date - Friday 29 June 2007.
Dividend payable - Monday 2 July 2007.
Share certificates may not be dematerialised or re-materialised between
Monday 25 June 2007 and Friday 29 June 2007, both dates inclusive.
By order of the board
JD Cole Secretary
11 May 2007
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
Unaudited Audited
six months ended year ended
31 March 30 Sept
2007 2006 2006
R`000 R`000 R`000
Balance at the beginning of the period 818,830 916,344 916,344
Shares issued 11,893 9,309 9,377
(Increase)/decrease in treasury shares (36,740) 3 (177,763)
Movement on foreign currency
translation reserve 1,423 (5,551) 19,140
Movement on share based payment reserve 2,688 1,031 2,613
Net profit after taxation for the
Period 55,333 41,513 136,846
(Loss)/Profit on sale of treasury
shares (26) 105 205
Dividends declared (61,968) (68,283) (87,932)
Balance at the end of the period 791,433 894,471 818,830
Comprising:
Share capital and premium 138 64,792 101
Foreign currency translation reserve 24,441 (1,673) 23,018
Share based payment reserve 13,920 9,647 11,232
Capital redemption reserve 90 90 90
Distributable reserves 726,805 799,164 760,569
Outsiders shareholders interest 26,039 22,451 23,820
Total 791,433 894,471 818,830
CONDENSED GROUP BALANCE SHEET
Unaudited Audited
31 March 30 Sept
2007 2006 2006
R`000 R`000 R`000
Assets
Non-current assets 490,911 381,088 511,305
Property, plant and equipment 299,820 276,538 316,457
Goodwill 22,434 17,271 21,911
Fishing rights and trademarks 36,015 32,139 40,109
Deferred taxation 13,174 11,380 12,850
Investments and loans 119,468 43,760 119,978
Current assets 765,065 916,616 826,327
Inventories 249,738 204,549 219,224
Accounts receivable 352,905 298,597 403,486
Non-current assets held for sale 1,100 1,200 4,950
Cash and cash equivalents 161,322 412,270 198,667
_______ _______ _______
Total assets 1,255,976 1,297,704 1,337,632
Equity and liabilities
Capital and reserves
Share capital and premium 138 64,792 101
Foreign currency translation reserve 24,441 (1,673) 23,018
Share based payment reserve 13,920 9,647 11,232
Capital redemption reserve 90 90 90
Distributable reserves 726,805 799,164 760,569
Interest of own shareholders 765,394 872,020 795,010
Interest of outside shareholders 26,039 22,451 23,820
Total equity 791,433 894,471 818,830
Non-current liabilities 33,119 29,841 30,961
Liability for share based payments 2,517 238 1,087
Deferred taxation 30,602 29,603 29,874
Current liabilities 431,424 373,392 487,841
Accounts payable and provisions 368,356 325,432 415,895
Bank overdrafts 63,068 47,960 71,946
Total equity and liabilities 1,255,976 1,297,704 1,337,632
Number of shares in issue net of
treasury shares (000`s) 99,971 113,166 101,493
Net asset value per ordinary share (cents)766 771 783
Total liabilities excluding deferred
taxation: Total equity (%) 55 42 60
Total borrowings: Interest of own
shareholders (%) 8 5 9
CONDENSED GROUP CASH FLOW STATEMENT
Unaudited Audited
six months ended year ended
31 March 30 Sept
2007 2006 2006
R`000 R`000 R`000
Cash flows from operating activities
Operating profit before abnormal
items 66,312 52,606 183,325
Adjustment for non-cash items 33,328 22,222 60,777
Operating cash flows before working
capital changes 99,640 74,828 244,102
Working capital changes (20,739) 84,435 50,606
Cash generated from operations 78,901 159,263 294,708
Interest and dividends received 11,118 18,148 34,651
Interest paid (3,167) (2,306) (5,160)
Taxation paid (33,167) (13,592) (46,960)
Dividends paid (64,080) (68,498) (86,034)
Net cash (outflow)/inflow from
operating activities (10,395) 93,015 191,205
Cash inflow/(outflow) from investing
activities 5,330 (14,164) (167,811)
Capital expenditure (13,792) (18,413) (94,276)
Proceeds on disposal of property,
plant and equipment 1,236 1,388 1,639
Proceeds on disposal of fishing rights 3,366 225 227
Net movement on loans and advances 5,708 3,077 12,789
Investment in preference shares - - (88,000)
Disposal of businesses 7,830 - -
Cash related abnormal items and other 982 (441) (190)
Net cash flows (applied to) from
financing activities (22,338) 1,617 (174,894)
Proceeds from issue of share capital 11,894 9,312 9,377
Proceeds on sale of treasury shares 27 105 264
Acquisition of treasury shares (36,794) - (177,822)
Short-term borrowings raised/(repaid) 2,535 (7,800) (6,713)
Net (decrease)/increase in cash
and cash equivalents (27,403) 80,468 (151,500)
Cash and cash equivalents at the
beginning of the period 126,721 283,195 283,195
Effect of exchange rate changes (1,064) 647 (4,974)
Cash and cash equivalents at the
end of the period 98,254 364,310 126,721
GROUP SEGMENTAL REPORT
Unaudited Audited
six months ended year ended
31 March 30 Sept
2007 2006 2006
R`000 R`000 R`000
Revenue
Inshore Fishing 620,011 611,335 1,318,949
Midwater and Deepsea Fishing 458,006 524,418 1,071,362
Commercial Cold Storage 58,328 61,334 154,247
_______ ________ ________
Total 1,136,345 1,197,087 2,544,558
Operating profit before abnormal items
Inshore Fishing 12,616 (3,706) 77,939
Midwater and Deepsea Fishing 43,440 37,500 46,705
Commercial Cold Storage 10,256 18,812 58,681
_______ ________ _______
Total 66,312 52,606 183,325
Total assets
Inshore Fishing 571,650 408,386 563,887
Midwater and Deepsea Fishing 228,257 299,166 264,306
Commercial Cold Storage 162,105 122,742 177,944
Financing 280,790 _ 456,030__ 318,645__
1,242,802 1,286,324 1,324,782
Deferred taxation 13,174 11,380 12,850___
Total 1,255,976 1,297,704 1,337,632
Total liabilities
Inshore Fishing 256,163 208,980 278,909
Midwater and Deepsea Fishing 85,726 87,329 90,756
Commercial Cold Storage 20,825 22,848 41,693
Financing 71,227_ 54,473 77,570_
433,941 373,630 488,928
Deferred taxation 30,602 29,603_ 29,874_
Total 464,543 403,233 518,802
NOTES
Unaudited Audited
six months ended year ended
31 March 30 Sept
2007 2006 2006
R`000 R`000 R`000
1. Abnormal items
Provision for impairment losses (4,686) - -
Profit on change of interest in
subsidiary/joint ventures 8,812 - 283
Provision in respect of utilisation of
pension fund surplus (1,164) - (6,842)
Surplus on disposal of property,
plant and equipment - 485 450
Surplus on disposal of fishing rights - 225 227___
Abnormal profit/(loss) before taxation 2,962 710 (5,882)
Taxation 628 (8) 1,954
Abnormal profit/(loss) after taxation 3,590 702 (3,928)
Number Number Number
of shares of shares of
shares
`000 `000 `000
2. Elimination of treasury shares
Weighted average number of shares
in issue 116,689 113,264 113,325
Less: treasury shares held by
share trusts (14,383) (228) (226)
Less: treasury shares held by
subsidiary company (1,542) - -_____
Weighted average number of shares on
which earnings per share and headline
earnings per share are based 100,764 113,036 113,099
R`000 R`000 R`000
3. Determination of Headline Earnings
Profit after taxation attributable to
own shareholders 51,564 38,500 129,791
Adjusted for:
Provision for impairment losses 3,916 - -
Profit on change of interest in
subsidiaries/joint ventures (8,333) - (283)
Net surplus on disposal of property,
plant and equipment (114) (700) (596)
Net surplus on disposal of fishing rights - (225) (227)
Insurance proceeds for damaged vessel - - (1,104)
Headline earnings for the year 47,033 37,575 127,581
R`000 R`000 R`000
4. Dividends
Estimated dividend declared
after reporting date 18,995 16,975 59,881
Dividend on shares issued prior
to last day to trade - 537___
Actual dividend declared 16,975 60,418
5. Supplementary information
Cost of sales 808,350 885,425 1,805,035
Depreciation 29,367 26,304 57,315
Operating lease charges 9,397 7,200 17,470
Foreign exchange profit (666) (1,006) (9,838)
Capital expenditure 13,792 18,413 94,276
Expansion - 8,555 62,456
Replacement 13,792 9,858 31,820
Capital commitments 35,536 89,989 63,144
Contracted 7,177 41,717 2,124
Approved 28,359 48,272 61,020
COMMENTS
Financial Results
Headline earnings per share for the six months ended 31 March 2007 increased by
40% compared to those of the first half of last year. Earnings per share for the
same period were 50% higher mainly as a result of the profit on disposal of Tuna
Marine less impairment provisions raised.
Although turnover decreased by 5%, operating profit before abnormal items
increased by 26%. The major contributing factors to the improved margins were
higher export prices and good catches in the horse mackerel, lobster and
fishmeal sectors. Headline earnings increased by 25%.
The weighted average number of shares in issue was lower due to the shares held
by the black employee share trust (Khula Trust) being treated as treasury
shares. This contributed to higher earnings on a per share basis.
An interim dividend of 19.0 cents per share has been declared. (2006: 15.0
cents per share).
Review of operations
Inshore Fishing
The 2007 Total Allowable Catch (TAC) for pilchard was reduced to 162 436 tons
(2006: 204 000 tons). Pilchard landings improved on last year but are still
insufficient to meet consumer demand. Fish is being caught on the south and east
coasts with good catches made recently along the west coast. Canning yields were
poor particularly at the beginning of the season but have since improved.
Pilchard fishing has not commenced in Namibia where the announcement of a
provisional TAC is awaited (2006: no landings against the 25 000 ton TAC).
Sales volumes of Lucky Star canned fish on the domestic market decreased
significantly compared to the previous year due to the shortage of supply. In
the UK, Glenryck Foods also experienced pilchard procurement difficulties and
performance was below that of the prior year.
Overall, profitability from canned fish was considerably lower than in the same
period last year.
Fish meal operations recorded a profit for the six months due to significantly
higher prices achieved in export markets. Landings of industrial fish were
higher comprising mainly red eye herring. The anchovy A season TAC for 2007 is
186 942 tons (2006: 212 251 tons) and is normally landed in the winter months.
Selling prices for fishmeal are expected to be maintained in the second half.
The TAC for west coast lobster was reduced to 2 774 tons (2006: 3 174 tons). The
uncaught quota from 2006 was carried forward for catching in 2007. Oceana quota
available amounts to 551 tons (2006 actual catch: 366 tons). To date lobster
landings have been good and production costs per unit were lower mainly as a
result of higher volumes. Export prices were higher and the weaker rand exchange
rate further increased sales realisations resulting in improved profitability.
Squid catches were below those of last year. Higher market prices and the
reversal of certain provisions resulted in increased profits.
Midwater and Deep-sea Fishing
Although turnover declined due to lower volumes of horse mackerel sourced from
external fleets, selling prices remained at high levels. Horse mackerel catches
were higher and vessel costs per day reduced. Overall operating profit from
horse mackerel was higher than last year.
Results from hake operations showed an improvement mainly as a consequence of
better fishing conditions and higher prices offset by the effect of lower
quotas.
Cold Storage
The cold storage division experienced higher volumes handled through the stores
but shorter dwell times resulted in lower revenue. Profits were substantially
lower.
Long Term Commercial Fishing Rights
Certain subsidiaries are involved in a number of review applications brought in
the High Court by various parties regarding the allocations of long term fishing
rights. Completion of this legal process is expected to take some time.
Directorate
On 8 February 2007 Ms L Ruthilal resigned and Mrs ABA Conrad was appointed to
the board. On 11 May 2007 Mr FJ Robertson was appointed to the board.
Prospects
Headline earnings for the full year are expected to exceed those of last year.
Second half earnings growth is expected to be at a lower rate than that of the
first half.
On behalf of the board.
MA Brey AB Marshall
Chairman Chief executive Officer
11 May 2007
Date: 11/05/2007 16:41:01 Produced by the JSE SENS Department.
