| Thu 11 Feb 2010, 16:02 | | CBH - Country Bird Holdings Limited - Country Bird Posts 14% Rise In Revenue |
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CBH
CBH
CBH - Country Bird Holdings Limited - Country Bird Posts 14% Rise In Revenue
At Interim Stage
Country Bird Holdings Limited
(Incorporated in the Republic of South Africa)
Registration number: 2005/008505/06
ISIN: ZAE000094835
JSE Share code: CBH
("CBH" or "the Company")
COUNTRY BIRD POSTS 14% RISE IN REVENUE AT INTERIM STAGE
Country Bird Holdings (CBH) has announced a 14% rise in revenue to R1,26
billion for the six months ended 31 December 2009. This compares with
revenue of R1,11 billion for the comparable period in 2008.
Cost of sales increased 13% to R1,11 billion for the period (2008: R977
million), increasing the gross profit by 17% to R149,8 million (2008: R128,3
million) after accounting for a 13% increase in cost of sales attributable to
revenue growth.
Profit before tax fell 23% to R56,1 million (2008: R72,5 million) due
primarily to the inclusion in 2008 of the R18,5 million profit on sale of the
group`s joint venture with Astral Foods. Included in the current year figure
is the write down of the Sovereign shareholding in the amount of R9,9
million.
The group`s gearing ratio improved slightly to 2,06 from 2,46 a year ago due
mainly to an increase in retained earnings.
While two non-operational distortions saw EPS drop, adjusted EPS was up 32%,
with HEPS up 3% on the previous period.
Commenting on the results, Group financial director Robbie Taylor says the
poultry market is under pressure characterised by lower realisations and weak
demand but an upturn is anticipated with the onset of the Soccer World Cup.
"Production efficiencies have been most encouraging with the company
recording best ever figures in key performance areas such as food conversion
ratios, on-farm mortalities, carcass yields and kilograms per square metre.
At the same time the focus has been to improve animal welfare practices and
we have been requested by key customers to make our practices the standard
for their other suppliers."
The Poultry division reported a 3,8% increase in volumes sold for the period,
but there was a drop in realisations of 4,0%. There was a 7,5% drop in the
feed price and a 4,3% improvement in food conversion ratios in the poultry
division so, despite an 8,9% increase in operating costs, margins improved to
8,7% (2008: 7,6%). The result was an operating profit of R67,6 million for
the period, compared to R51,4 million for the comparable period in 2008.
Taylor says that industry figures show that poultry imports bounced back over
the period, increasing 35% over the same period last year, impacting
realisations and stock levels.
As regards animal nutrition, Nutri Feeds reported an improvement of 17,6% in
volumes sold for the period under review. This is the first full period in
which Nutri Feeds has been 100% owned by the group and the drop in operating
profit reflects a shift in accounting policies, with only operating profit on
external sales being shown for the period.
Regarding animal nutrition in other African countries, Taylor says the mills
in both Zambia and Botswana are on target for penetration into their markets,
showing a combined revenue increase of 28,9% to R119,0 million (2008: R92,4
million) and an operating profit improvement to 5,9% (2008: 3,8%).
In terms of the group`s red meat operation, the efficiency and
rationalisation improvement programmes continued successfully in a very
difficult trading environment. "New product launches and penetration into
new market outlets are the light on the horizon for this business which has
shown tremendous revenue growth," says Taylor. Sales for the period reached
R159,9 million (2008: R65,6 million).
"The primary input in poultry production is maize and the white maize price
was range bound between R1,400 and R1,600 per ton for much of the period
under review. However, due to procurement strategies the group was able to
reduce overall feed costs by 7,5% and in a bearish market closed the period
with very few long positions." says Taylor.
Looking to the second half of the current financial year, he says the poultry
industry in South Africa will continue operating at reduced margins compared
to previous years, with demand and realisations remaining under pressure.
Input costs are steady and imports remain volatile.
In line with the group`s dividend policy of three times cover, a tax-
efficient capital distribution from share premium of 6,41 cents per share has
been declared for the period, payable on 3 May 2010.
As part of the ongoing alignment with the guidelines of King III, the board
of CBH has been strengthened by the appointment of three strong non-executive
directors. Ray Gibbison and Ian Isdale, join as new appointments bringing
both operational and corporate governance skills to the group, while Geoff
Heath, previously an executive director, takes on a non-executive role.
About Country Bird Holdings Limited (CBH)
CBH, which listed on the JSE in May 2007, is a holding company incorporating
integrated poultry, stock feed and beef businesses in South Africa, operating
as Supreme Poultry, Nutri Feeds and Long Iron Meats respectively, as well as
poultry breeding and broiler operations in the southern African region,
operating as Ross Africa and Master Farmer. CBH is currently active in South
Africa, Botswana and Zambia.
Issued for: Country Bird Holdings Limited (CBH)
Contact: Robbie Taylor, Group Financial Director: 011 778 0658 / 082
809 9506
Fax No: 086 660 0917
Email: Robbie@countrybird.co.za
Website: www.cbhltd.co.za
Issue by: Tish Stewart Corporate and Investor Communications
Contact: Tish Stewart: 082 4436399 / 011 442 5536
Fax No: 011 447 9317
Email: tishstewart@mweb.co.za
Date: 11 February 2010
Sponsor: Investec Bank Limited
Date: 11/02/2010 16:02:02 Produced by the JSE SENS Department.
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