| Mon 18 Feb 2008, 15:00 | | CBH - Country Bird Holdings - Unaudited Interim Results for the period |
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CBH
CBH
CBH - Country Bird Holdings - Unaudited Interim Results for the period
ended 31 December 2007
Country Bird Holdings Limited
Registration number: 2005/008508/06
JSE Share Code: CBH
ISIN Code: ZAE000094835
Unaudited Interim Results for the period ended 31 December 2007
Condensed Consolidated Income Statement
6 months 6 months 12 months
ended ended ended
31 December 31 December 30 June
2007 2006 2007
Unaudited Unaudited Audited
R`000 R`000 R`000
Revenue 832 466 590 623 1 309 161
Gross profit 117 965 107 009 221 196
Operating expenses (39 782) (21 631) (73 283)
Operating profit 78 183 85 378 147 913
Net finance cost (10 224) (6 215) (8 484)
Profit before income tax 67 959 79 163 139 429
Income tax expense (19 389) (22 011) (39 583)
Profit after tax 48 570 57 152 99 846
Profit from discontinued - 311 -
operations
Profit for the period 48 570 57 463 99 846
Minority interest (73) (1 091) (1 588)
Profit attributable to 48 497 56 372 98 258
equity holders
Profit on disposal of (649) (149) (157)
property, plant and
equipment
Loss on sale of investment 792 - 424
Headline earnings 48 640 56 223 98 525
Weighted average number of 187 099 313 187 099 313 187 099 313
ordinary shares
Dilutive effect of share 1 541 218 - -
options
Diluted number of ordinary 188 640 531 187 099 313 187 099 313
shares
Earnings per ordinary share
(cents):
- basic 25,92 30,13 52,52
- diluted 25,71 30,13 52,52
Headline earnings per share
(cents):
- basic 26,00 30,05 52,66
- diluted 25,78 30,05 52,66
Condensed Consolidated Balance Sheet
As at As at As at
31 December 31 December 30 June
2007 2006 2007
Unaudited Unaudited Audited
R`000 R`000 R`000
ASSETS
Non-current assets 289 909 254 195 273 955
Property, plant and 255 917 229 656 247 206
equipment
Intangible assets 15 557 14 918 15 557
Financial assets and other 1 567 198 198
investments
Investment in associates 13 481 3 537 10 140
Deferred income tax 3 387 5 886 854
assets
Current assets 456 895 305 909 387 026
Inventories 77 972 34 011 57 612
Biological assets 115 722 86 258 119 677
Trade and other 248 818 160 050 175 567
receivables
Assets classified as held - 12 835 -
for sale
Cash and cash equivalents 14 383 12 755 34 170
Total assets 746 804 560 104 660 981
EQUITY
Capital and reserves
attributable to equity
holders of the Company
Total equity 285 977 293 375 234 461
Share capital 1 871 1 871 1 871
Share premium 825 721 933 576 825 721
Other reserves 25 086 9 970 23 002
Retained earnings 262 994 178 223 220 108
Common control deficit (832 132) (832 132) (838 605)
283 540 291 508 232 097
Minority interest 2 437 1 867 2 364
LIABILITIES
Non-current liabilities 200 150 119 202 187 002
Borrowings 138 478 65 203 141 314
Deferred tax liability 61 672 53 999 45 688
Current liabilities 260 677 147 527 239 518
Trade and other payables 195 320 110 020 166 141
Current income tax 32 322 11 433 29 915
liabilities
Borrowings 31 435 21 205 42 962
Bank overdraft 1 600 - 500
Liabilities classified as - 4 869 -
held for sale
Total liabilities 460 827 266 729 426 520
Total equity and liabilities 746 804 560 104 660 981
Condensed Consolidated Interim Cash Flow Statement
6 months 6 months 12 months
ended ended ended
31 December 31 December 30 June
2007 2006 2007
Unaudited Unaudited Audited
R`000 R`000 R`000
Cash generated from
operating activities
Net cash generated from 10 170 67 333 109 622
operating activities
Net cash generated from 28 963 77 382 128 755
operations
Interest paid (10 311) (7 428) (11 982)
Dividend paid (5 613) - -
Discontinued operations - 275 -
Income tax paid (2 869) (2 896) (7 151)
Cash flow from investing (16 915) (19 229) (45 642)
activities
Cash flow from financing (14 362) (39 852) (41 241)
activities
Net increase/(decrease) in (21 107) 8 252 22 739
cash and cash equivalents
Cash and cash equivalents at 33 670 10 931 10 931
beginning of period
Foreign exchange differences 220 (6 428) -
Cash and cash equivalents at 12 783 12 755 33 670
end of period
Segment Reporting 6 months 6 months 12 months
ended ended ended
31 December 31 December 30 June
2007 2006 2007
Unaudited Unaudited Audited
R`000 R`000 R`000
REVENUE
South Africa 791 112 554 483 1 231 474
Other Africa 48 156 39 637 79 333
Intersegment revenues (6 802) (3 497) (1 646)
832 466 590 623 1 309 161
OPERATING PROFIT
South Africa 62 848 73 950 122 602
Other Africa 15 335 11 428 25 311
78 183 85 378 147 913
Condensed Interim Statement of Changes in Equity
Opening balance 234 461 232 761 232 761
Capital distribution - - (102 000)
BEE ownership transaction - - 12 334
Sale of subsidiary included 6 474 6 474 -
in common control deficit
Share incentive scheme 1 123 - -
Currency translation 962 (3 323) (2 625)
differences
Share issue and listing - - (5 855)
expenses
Net profit for the period 48 497 56 372 98 258
Minorities share of profits 73 1 091 1 588
and reserves
Dividend (5 613) - -
At end of period 285 977 293 375 234 461
Notes to the results
1. Basis of preparation
The unaudited condensed consolidated interim financial information ("interim
financial information") announcement for the half year ended 31 December 2007
was prepared in accordance with IAS 34, "Interim financial reporting" and in
compliance with the Listing Requirements of the JSE Limited and the South
African Companies Act (1973). The accounting policies are consistent with those
of the previous financial period and comply with International Financial
Reporting Standards (IFRS). These financial statements do not include all the
information required for full annual financial statements and should be read in
conjunction with the consolidated financial statements as at and for the year
ended 30 June 2007.
These condensed consolidated interim financial statements were approved by the
Board of Directors on 15 February 2008.
2. Capital expenditure incurred 20 816 17 827 53 314
3. Commitments for property,
plant and equipment
Contracted for 165 6 000 8 914
Approved but not yet contracted 2 050 - -
2 215 6 000 8 914
4. Dividends
A dividend of 3 cents per share was approved by shareholders at the Annual
General Meeting on 23 November 2007, which dividend was paid on 24 December
2007. Total dividend paid was R5 612 979.
Commentary on results
1. Reporting entity
Country Bird Holdings Limited is a holding company incorporating large
integrated poultry and stock feed business operations in South Africa operating
as Supreme and Nutri Feeds and poultry breeding operations in the Southern
African region operating as Ross Africa. Country Bird Holdings currently
operates in South Africa, Botswana and Zambia.
2. Financial
The group`s turnover has increased by 40,9% to R832,5 million (2006 - R590,6
million) but the effects of the high maize prices coupled with stable poultry
selling prices have resulted in the operating profit margin reducing from 14,5%
at December 2006 to 9,4% for the current period. Operating expenses have
increased as a result of initiatives taken at each of the operating entities to
accommodate current and future volume growth.
Additional gearing introduced prior to the listing has increased net finance
costs to R10,2 million (2006 -R6,2 million) reducing profit attributable to
equity holders to R48,5 million (2006 - R56,4 million).
Cash outflows from financing activities comprise contractual repayments of
borrowings. Given the current poultry trading conditions focus on cash flow
management will remain a priority.
No interim dividend has been declared. It is the intention of the Board to
remain consistent with its dividend policy to date by declaring an annual
dividend which is three times covered.
3. Operational
South Africa
Operating profit from the South African operations reduced by 15% to R62,8
million (2006 - R74,0 million). The restructure and expansion programme of the
recently acquired feed division resulted in volume increases of 20% whereas
volumes in the poultry division increased by 9%. However, the improved margins
in the feed division were insufficient to offset the inability of the poultry
division to fully recover their cost increases. The overall result was an
operating margin of 7,9% (2006 - 13,3%).
The poultry industry has achieved sustained levels of growth and high margins
for a considerable period, however, high feed input costs together with an
element of oversupply has resulted in margins being reduced across the industry.
Ross Africa
This division comprises a grandparent breeding operation in Zambia and a parent
breeding operation in Botswana. Revenue increased by 16% with operating profit
of R15,3 million (2006 - R11,4 million), with improved capacity utilisation
increasing operating margins to 31,8% (2006 - 28,8%).
The economy in Zambia remains strong and continues to benefit from successive
years of recovery providing good prospects for continued growth. Local market
share continues to grow whilst exports of the Ross parent stock to the region
remain strong.
In Botswana the newly established parent flocks were not at full production
which, together with a regional shortage of hatching eggs, resulted in similar
profit levels being achieved to those of the previous period. The second six
months should show an improvement.
4. Prospects
It is anticipated that the poultry industry in South Africa will be operating at
reduced margins for the major part of 2008. The negative impact will be
mitigated by the growth in Ross Africa and the continued strong performance in
the feed division. Anticipated improvements from the change of breeding genetics
should begin to show in the second half of FY08 and in the first half of FY09.
The Ross Africa Business Development Team continue to make progress with project
appraisal and development in countries in Sub-Saharan Africa and an operational
feedmill was acquired by Ross Botswana during January 2008. With new management
and group related volumes, efficiencies in the mill should be restored and
improved in the near future.
Additional capacity facilities are currently under consideration in both Zambia
and Botswana.
GENERAL INFORMATION
Country of Incorporation: Republic of South Africa
Directors: BH Kent (Non-executive chairperson), GP Heath, KW James, CD Stein
(Independent non-executive)
Secretary with postal and business address:
RJ Taylor, PO Box 11079, Silver Lakes, 0054
Unit 16, Block 76, Silver Lakes Drive, Tiger Valley Office Park, Tiger Valley,
0054
Registered office and business address:
Unit 16, Block 76, Silver Lakes Drive, Tiger Valley Office Park, Tiger Valley,
0054
Registered postal address:
PO Box 11079, Silver Lakes, 0054
Transfer Secretaries:
Computershare Investor Services 2004 (Proprietary) Limited,
70 Marshall Street, Johannesburg, 2001
Bankers
Absa Bank Limited
Attorneys
Smith Tabata Buchanan Boyes Attorneys, Johannesburg
Auditors
PricewaterhouseCoopers Inc., Bloemfontein
Sponsor
Investec Bank Limited
Date: 18/02/2008 15:00:01 Produced by the JSE SENS Department.
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