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SOV
SOV
SOV - Sovereign Food Investments - Business Update And Further Cautionary
Announcement
SOVEREIGN FOOD INVESTMENTS LIMITED
Incorporated in the Republic of South Africa
Registration Number 1995/003990/06
JSE Code: SOV ISIN Number: ZAE000009221
("Sovereign Foods" or "the Company" or "the Group")
BUSINESS UPDATE AND FURTHER CAUTIONARY ANNOUNCEMENT
Background
Shareholders are referred to the joint announcement by Sovereign Foods and
AFGRI Limited ("AFGRI") on 15 May 2009 regarding the proposed reverse listing
of AFGRI`s Food Division into Sovereign Foods ("the Proposed AFGRI
Transaction") and the announcements by Country Bird Holdings Limited ("Country
Bird") on 14 May 2009, 20 May 2009 and 1 June 2009, regarding the acquisition
by Country Bird of shares in Sovereign Foods.
Country Bird`s most recent announcement dated 1 June 2009 stated that it had
acquired 22.76% of the issued ordinary share capital of Sovereign Foods ("The
Country Bird Shareholding"). In view of the Proposed AFGRI Transaction and
the Country Bird Shareholding, Sovereign Foods has had discussions with
Country Bird as a shareholder. At this stage there are no developments which
the Sovereign Foods board of directors ("the Board") deems to be necessary to
be brought to the attention of the shareholders of Sovereign Foods.
As a result of the above, the Board considers it prudent to provide
shareholders with the most recent information available regarding the
Sovereign Foods operations. Accordingly, a business update in respect of the
three months ended 31 May 2009 has been provided below.
It is not the intention of the Company to report on its operations on a
quarterly basis in future.
Business Update
Unaudited Income Statement and Balance Sheet of the Group for the three months
ended 31 May 2009.
Unaudited Audited
Three Months Year
ended 31 May ended
28
February
2009 2008 2009
R`000 R`000 R`000
Income Statement
Revenue 283 339 174 355 909 121
Profit / (loss) before 40 110 (7 551) 50 647
interest paid
Net interest paid (17 941) (8 319) (56 173)
Net operating income/(loss) 22 169 (15 870) (5 526)
Normal and deferred (6 207) 4 444 5 034
taxation
Retained earnings / 15 962 (11 426)
(accumulated loss) for the (492)
period
Weighted average number of 33 003 33 003 33 003
shares in issue (000`s)
Earnings/(loss) per share 48.4 (34.6) (1.5)
(cents)
Headline earnings/(loss) 48.4 (34.6) (1.5)
per share (cents)
Unaudited Audited
Three Months Year
ended 31 May ended
28
February
2009 2008 2009
R`000 R`000 R`000
Balance Sheet
Assets
Non-current assets
Property, plant and 793 978 615 746 780 130
equipment
Current assets 310 338 272 187 320 427
Cash and cash 43 656 68 118 82 679
equivalents
Inventory and biological 117 292 114 953 124 423
assets
Trade and other 149 390 89 116 113 325
receivables
Total assets 1 104 316 887 933 1 100 557
Equity and liabilities
Capital and reserves
Equity 299 810 275 468 286 493
Interest bearing debt 551 765 429 155 548 966
Long term portion 457 066 316 695 457 981
Short term portion 94 699 112 460 90 985
Deferred taxation 103 268 94 175 97 062
Trade and other payables 149 473 89 135 168 036
Total equity and 1 104 316 887 933 1 100 557
liabilities
Notes:
The Group has had a very significant recovery in the first quarter of the year
as a result of improved volume throughput and improved poultry prices.
Pricing in the first quarter has increased by 27% over the previous comparable
period as a result of strong domestic demand and increased international
pricing.
Volume growth was exceptionally strong in the three months ended 31 May 2009
with volumes increasing by 28% over the previous comparable period.
The unaudited income statement and balance sheet for the three months ended 31
May 2009 as set out above have been prepared in accordance with International
Financial Reporting Standards and the accounting policies applied are
consistent with those applied for the audited group results for the year ended
28 February 2009.
The financial information as set out above has not been reviewed and/or
reported on by the Group`s auditors.
The results for the six months ended 31 August 2009 are expected to be
released on or about 1 October 2009.
Further cautionary announcement
Shareholders are referred to the cautionary announcement dated 15 May 2009 and
are advised that the Company remains involved in negotiations which may have a
material effect on its share price.
Accordingly, shareholders are advised to continue to exercise caution when
dealing in the Company`s shares until a further announcement is made.
Port Elizabeth
22 June 2009
Corporate Advisor and Sponsor
Barnard Jacobs Mellet Corporate Finance (Proprietary) Limited
Date: 22/06/2009 14:21:01 Produced by the JSE SENS Department.
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