| Tue 28 Apr 2009, 8:16 | | LAF - Lonrho - Trading Update for the Quarter Ended 31 March 2009 |
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LAF
LOLAF
LAF - Lonrho - Trading Update for the Quarter Ended 31 March 2009
Lonrho Plc
(Formerly Lonrho Africa Plc)
(Incorporated and registered in England and Wales)
(Registration number 2805337)
(Share code: LAF; ISIN number: GB0002568813)
("Lonrho" or "the Company")
Trading Update for the Quarter Ended 31 March 2009
"Lonrho Reports Continued Strong Growth"
27 April 2009
Lonrho PLC (AIM: LONR) today announces its unaudited trading update for the
second quarter ended 31 March 2009 ("Second Quarter").
These results (and comparative figures included therein) do not form audited
accounts nor have been extracted from audited accounts. The comparative
figures used are year on year due to the influence of seasonality within the
different businesses in the group. The Company intends to release and post its
half year results during May 2009.
Trading Update - 3 months to 31 March 2009
The second quarter of 2008/09 has seen a period of focus on delivering growth
in the core businesses. The Company continues to operate in five strategic
sectors. (Transportation, Infrastructure, Agriculture, Support Services and
Hotels). Lonrho has built a portfolio of businesses geographically distributed
across Africa`s strongest emerging markets. Lonrho believes these businesses
are well positioned to capitalise on further growth opportunities.
- Second Quarter turnover of continuing operations was GBP19.6m. This
represents a significant increase of +245% on a reported basis, and
+61% increase on a like for like basis against the prior year.
- Year to date turnover for the first six months was GBP41.5m, this is
an increase of +275% on a reported basis against the previous year
and 60% increase on a like for like basis.
- The Company held cash balances of GBP13m at 31 March 2009.
- Net assets increased to GBP86.1m up from GBP83.0m at 31 December
2008.
- EBITDA in the Second Quarter has improved 68% on the prior year with
a loss of GBP2.7m compared to a loss of GBP8.3m in the prior year on
a reported basis.
- Profit before tax for the first six months on a reported basis was a
profit of GBP0.6m compared to a loss of GBP6.2m in the previous
year.
The Group has recognised foreign exchange gains of GBP6.1m in respect of the
half year to 31 March 2009. As at 31 March 2009, the Group also had
unrecognised foreign exchange gains of GBP7.1m.
The Second Quarter profit before tax includes a one off gain of GBP2.3m in
relation to the closure of SAILS.
Trading Highlights by Division
Agri-Processing
- Rollex SA (51% holding), continues to be the central focus within
Lonrho Agriculture`s logistical division and like for like Quarter 2
sales were up 89% year on year. International fish export volumes
decreased by 4.1% in Q2 due to slow down in global markets. Rollex
have successfully offset this impact by identifying and entering new
markets. In Zambia, road hauled cargo has more than quadrupled to
1,256 tons from 306 tons in the second quarter of 2008. These
volumes comprise general cargo to Zambia and include the early
autumn harvest volumes (vegetables and Flowers) from Zambia to South
Africa. Cargo volumes to Zimbabwe have grown strongly during the
quarter. Despite shrinking world markets Rollex is remaining
profitable and continuing to grow.
- Building work continues for the first John Deere Angola branch which
will be located in Catete, in the Bengo Province. This branch is
anticipated to open in July 2009 to coincide with the Angolan
National Agricultural Fair ( FILPA ). Initial customer discussions
are very positive.
Transport
- Lonrho`s pan African aviation company, branded Fly540, has continued
to expand its operations. The roll out plans for Angola and Ghana
continue to proceed and are at an advanced stage. 540 Angola is
expected to commence operations during the next quarter and followed
by 540 Ghana in the second half of 2009.
- At 540 Kenya (49% holding), the business continues to operate
profitably, with passenger numbers reaching 17,311 in March 2009
(2008: 13,579 passengers), above budget for a slower month prior to
the increased demand in preparation of the Easter holidays. The
Nairobi to Kilimanjaro route opened in January 2009 and the Nairobi
to Mwanza route is expected to open during the coming quarter.
- 540 Uganda, (90% holding), continues to see freight volumes growing
although growth has been hampered by the delay in the slow return of
the food aid flights to the DRC. It is intended to open passenger
routes as planned to Rwanda, Juba and Mwanza during the next
quarter.
- 540 Tanzania (90% holding), we expect that 540 Tanzania will receive
its Air Operators Certificate (A.O.C) before end of May 2009 which
will be in time for the peak travel season in June. It is currently
operating premium business charter flights in Tanzania until the
A.O.C is granted. Clients include the Tanzanian government, NGO`s
and commercial clients.
Support Services
- Bytes & Pieces (65% holding), continues to grow as a result of
expanding business provided to existing clients as the market
benefits from the continued rejuvenation of Mozambique. All the
solutions that are offered to customers are based on converged
technologies and unified communications. Avaya IP Telephony systems
and Polycom video conferencing products have been added to the
product portfolio. Bytes &Pieces recently provided Avaya products
and services to First National Bank and TATA in Mozambique.
- Lonrho IT (CES, 50% holding), continues to grow its operations in
South Africa and gain market share. CES has opened a new branch in
Lusaka in Zambia on the 1st April and anticipates opening another
branch in Angola in the coming quarter and in Malawi.
Infrastructure
- At Luba Freeport (63% holding), negotiations are proceeding well for
new clients to utilise the port as a central operational base. Noble
Energy has agreed a US$ 2 billion contract with the Government of
Equatorial Guinea and has signed an MOU to locate their operations
at Luba. Revenue has increased by 13% on a reported quarterly basis
against the previous year. Costs continue to be kept below budget.
There has been a two month delay with the delivery of the new
container scanner which is now due to arrive in May 2009.
- Kwikbuild Corporation Limited (62% holding) and the South African
subsidiary e-Kwikbuild has reported that turnover has been lower
than expectations. This is due to the South African government
postponing awarding contracts until after the elections which were
held on 22 April 2009. The order book currently stands in the region
of ZAR 58m. Margins have improved during the current quarter and
this is attributable to the new plant that was opened during the
previous quarter which is functioning as planned.
Hotels
- At the Hotel Cardoso in Mozambique (59% holding + Management
Contract), the new restaurant has now been completed as well as the
refurbishment and redevelopment of the adjacent park. Occupancy has
steadily increased during the quarter and reached 83.2% during
March with an average room rate of US$83 per night compared with an
occupancy rate of 72.6% and a room rate of US$65 per night in March
of the previous year.
- Hotel Grand Karavia in Lubumbashi, DRC, (50% holding + Management
Contract) continues with its US$20m refurbishment. A loan agreement
with the DBSA was signed during the quarter providing a US$10m loan
specific to the refurbishment project. The balance of the project is
being funded by local joint venture partners and banks. Contractors
are on site and redeveloping the hotel and landscaping the grounds.
The hotel remains scheduled to re-open in summer of 2009 and provide
the only quality accommodation in Lubumbashi. The copper belt of the
DRC has seen improved economic activity with mines that had gone on
care and maintenance recommencing production as commodity prices
rise.
Other
- Lonrho Mining. Lonrho participated in a successful rights issue in
Lonrho Mining, which is listed on the Australian Stock Exchange.
Lonrho`s Holding currently stands at 25.59% and the results from the
Lulo concession in Angola remain very encouraging.
- Lonzim PLC, in which Lonrho has a 24.25% shareholding, has announced
that it expects to be served by Pershing Nominees Limited on behalf
of AMB Capital (Ireland) Limited ("AMB"), a company that has
recently acquired 20.75% of the Lonzim issued share capital a
requisition to convene an Extraordinary General Meeting ("EGM") of
its shareholders. This will be after the company`s Annual General
Meeting ("AGM") which has already been convened for 30th April 2009.
Key Developments Announced
During the First Quarter, Lonrho also announced two other important
developments:
- Lonrho Mining Ltd has reinforced the Lulo Diamond project Kimberlite
potential following positive microprobe results.
- Beaumont Cornish Limited has been appointed as Nominated Adviser,
and WH Ireland Limited has been appointed as broker to the Company
Current Trading and Future Outlook
Each of the Company`s core businesses continued to perform to expectations
during the second quarter. The impact of the global recession continues to be
felt across Africa, however the impact on the African continent is less severe
and forecasts expect sub Saharan growth in GDP to continue in 2009 albeit at a
slower rate. Lonrho continues to focus on the industry sectors and specific
economies which it believes will continue to provide the strongest growth in
Africa.
It is intended that the next quarterly update for the company will be released
in July 2009.
David Lenigas, Lonrho`s Executive Chairman commented:
"Lonrho has for the second consecutive quarter delivered strong financial
results, which have delivered continued strong growth at a time when the
global economy is contracting, with revenues increasing 61% on a like for like
basis against the same period last year. We expect to report a profit before
tax for the half year end 31 March 2009"
"We expect Lonrho`s operations to continue to deliver strong quarterly trading
performances in 2009, and we are focusing on strengthening our core
businesses. We remain extremely positive about Lonrho`s prospects in our
chosen countries of operation and specific market sectors across Africa."
LONRHO GROUP
GROUP TURNOVER
1 JANUARY to 31 MARCH 2009
GBP`000S
TURNOVER on a reported basis
3 Months 3 Months
to to
31 MAR 31 MAR
2009 2008 Variance Var
%
Agri Processing
Rollex 10,670 0 10,670 100%
Transport
540 Group 3,807 1,785 2,022 113%
Other 0 166 -166 -
100%
Support Services
Bytes & Pieces 1,642 1,389 253 18%
Other 298 147 151 103%
Infrastructure
Luba Freeport 2,052 1,811 241 13%
E-Kwikbuild 476 0 476 100%
Hotels
Hotel Cardoso 612 376 236 63%
Continuing 19,557 5,674 13,883 245%
operations
Shipping -
Discontinued
SAILS 0 3,179 -3,179 N/A
Discontinued 0 3,179 -3,179 N/A
operations
Total Turnover 19,557 8,853 10,704 121%
LIKE FOR LIKE TURNOVER
3 3 Months
Months to
to 31 MAR
31 MAR 2008 Variance Var
2009 %
Agri Processing
Rollex 10,670 5,641 5,029 89%
Transport
540 Group 3,807 1,785 2,022 113%
Other 0 166 -166 -
100%
Support Services
Bytes & Pieces 1,642 1,389 253 18%
Other 298 147 151 103%
Infrastructure
Luba Freeport 2,052 1,811 241 13%
E-Kwikbuild 476 831 -355 -43%
Hotels
Hotel Cardoso 612 376 236 63%
Continuing 19,557 12,146 7,411 61%
operations
Shipping -
Discontinued
SAILS 0 3,179 -3,179 N/A
Discontinued 0 3,179 -3,179 N/A
operations
Total Turnover 19,557 15,325 4,232 28%
1. Including Rollex and E-Kwikbuild and removal of Sails from 2008 results
Results sourced from March 2009 management accounts
LONRHO GROUP
GROUP TURNOVER
SIX MONTHS to 31 MARCH 2009
GBP`000S
TURNOVER on a reported basis
6 6 Months
Months to
to 31 MAR
31 MAR 2008 Variance Var
2009 %
Agri Processing
Rollex 22,859 0 22,859 100%
Transport
540 Group 8,013 3,590 4,423 123%
Other
Support Services
Bytes & Pieces 3,567 2,758 809 29%
Other 736 393 343 87%
Infrastructure
Luba Freeport 4,163 3,465 698 20%
E-Kwikbuild 853 0 853 100%
Hotels
Hotel Cardoso 1,312 861 451 52%
Continuing 41,503 11,067 30,436 275%
operations
Shipping -
Discontinued
SAILS 1,187 6,701 -5,514 -82%
Discontinued 1,187 6,701 -5,514 -82%
operations
Total Turnover 42,690 17,768 24,922 140%
LIKE FOR LIKE TURNOVER
6 6 Months
Months to
to 31 MAR
31 MAR 2008 Variance Var
2009 %
Agri Processing
Rollex 22,859 13,807 9,052 66%
Transport
540 Group 8,013 3,590 4,423 123%
Other
Support Services
Bytes & Pieces 3,567 2,758 809 29%
Other 736 393 343 87%
Infrastructure
Luba Freeport 4,163 3,465 698 20%
E-Kwikbuild 853 1,079 -226 -21%
Hotels
Hotel Cardoso 1,312 861 451 52%
Continuing 41,503 25,954 15,549 60%
operations
Shipping -
Discontinued
SAILS 1,187 6,701 -5,514 -82%
Discontinued 1,187 6,701 -5,514 -82%
operations
Total Turnover 42,690 32,655 10,035 31%
1. Including Rollex and E-Kwikbuild and removal of Sails from 2008 results
Results sourced from March 2009 management accounts
Enquiries
Lonrho Plc -
David Lenigas, Executive Chairman +44 (0)20 7016 5105
Geoffrey White, Chief Executive +44 (0)20 7016 5105
Officer
David Armstrong, Finance Director +44 (0)20 7016 5105
Emma de Borchgrave, Executive +44 (0)20 7016 5105
Director
Pelham PR
Charles Vivian +44 (0) 20 7743
6672
+44 (0) 7977 297903
James MacFarlane +44 (0) 20 7743
6375
+44 (0) 7841 672831
Beaumont Cornish Limited (Nomad)
Rosalind Hill Abrahams +44 (0) 20 7628
3396
Roland Cornish +44 (0) 20 7628
3396
South African Sponsor to Lonrho Plc
Java Capital (Proprietary) Limited
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