| Tue 26 Jun 2001, 0:00 | | Monteagle Holdings Societe Anonyme - Interim Repor |
|
INTERIM REPORT 2001
MONTEAGLE HOLDINGS S.A.
Registered Office:
(Incorporated in Luxembourg) 6 rue Adolphe Fischer,
(RC Number B19600) L-1520, Luxembourg
TO THE MEMBERS 25th June 2001
I am pleased to be able to report on another satisfactory half year for our
Group. Turnover for the group, including associates, has increased to
US$27,979,000 for the six months to 31st March 2001, compared to
US$27,287,000, mainly because our subsidiary had a good farming year also
our new acquisition St. James's Tea, which markets speciality teas in the
U.K., made a contribution for the first time. Profit before tax and
exceptional items has increased from US$605,000 to US$687,000 and this is
analysed by activity in note 2. Special credit must go to all our employees
in Zimbabwe for maintaining both the agricultural and gold mining operations
during the current unsettled political climate.
Our property operations achieved mixed results. Improvements in the U.S.A.
were largely offset by the 25% devaluation of the South African Rand
relative to the US Dollar and income was also reduced following the sale of
one of our South African properties.
The trading margins of our import and distribution businesses, which are
based mainly in South Africa, also suffered because of the devaluation.
However, increased turnover limited the shortfall in contribution to Group
results.
Our commercial agriculture and horticulture operations in Zimbabwe have
increased their contribution to group profit before tax by 17%, despite the
unstable operating environment. Sales of the most significant crops (tea,
flowers, and tobacco) are denominated in hard currencies and this has helped
us cope with local cost inflation, which is still in excess of 55%. Sales
of the produce of our subsidiary operations are seasonal and the bulk of
their contribution is recognised in the second half of the year.
The results of the gold mines in Zimbabwe are being squeezed between rapidly
inflating input costs and revenue constrained by a combination of a fixed
exchange rate and the continuing depressed international price of gold. The
Government of Zimbabwe has recently introduced a Gold Price Support scheme
to assist gold producers, but, in the absence of some further favourable
developments by the government, most of the mines may have to be closed
before the end of the calendar year. No provision has been made at this
stage for any closure costs.
The blue chip nature of our portfolios enabled us to weather the recent
stock market turbulence in so-called new technology stocks. Subsequent to
31st March 2001, in view of the uncertain outlook, we have sold
substantially all of our South African portfolio and intend to re-invest the
proceeds in hard currency areas. We believe that in the long term, this
will reduce the element of risk and enhance shareholder value. We have
also, subsequent to 31st March, sold our entire U.S. portfolio as we
consider that the short-term prospect for equity investments in the United
States is limited. Ready cash puts us in a strong position to take
advantage of the new opportunities that will arise when the current period
of uncertainty in world equity markets has run its course. Our gradual re-
investment programme will further enhance our net assets in hard currencies.
The group's net assets at market value were US$32,205,000 (US$5.10 per
share) at 30th September 2000. These have increased to US$32,659,000
(US$5.18 per share) at 31st March 2001 of which US$2.02 per share is
represented by our investment portfolios and other assets outside southern
Africa.
We remain very concerned about future developments in Zimbabwe, however we
believe that the diversity of our operations and strong balance sheet will
enable us to continue to deliver increasing value to shareholders.
J.M. Robotham, D.C. Marshall
Chairman Chief Executive
Offices:
United Kingdom: South Africa:
25 City Road, 11 Sunbury Park,
London, EC1Y 1BQ La Lucia 4051,
Durban
Transfer agents:
Europe South Africa
C.I. Registrars Limited Mercantile Registrars Limited
Cresta House, Alma Street, 11 Diagonal street
Luton, Bedfordshire, Johannesburg 2001
LU1 2PU, U.K. (P.O. Box 1053, Johannesburg, 2000
Consolidated group profit and loss account
Half years ended Year ended
31st March 30th
September
2001 2000 2000
Notes Unaudited Unaudited
US$000 US$000 US$000
Group Revenue including 27,979 27,287 55,436
Associates
Less revenue of Associates (17,388) (17,238) (30,385)
Group revenue 2 10,591 10,049 25,051
Operating costs (10,108) (9,451) (23,651)
Operating profit 483 598 1,400
Share of associated 274 140 616
companies' results
Income from investments - 197 196 435
dividends
- interest 76 63 200
1,030 997 2,651
Interest paid and similar (343) (392) (1,309)
charges
Profit on ordinary 687 605 1,342
activities before
exceptional items
and taxation
Exceptional items 3 83 1,511 1,948
Profit before taxation 770 2,116 3,290
Taxation (231) (524) (446)
Profit after taxation 2 539 1,592 2,844
Attributable to outside (205) (648) (999)
shareholders
PROFIT ATTRIBUTABLE TO 334 944 1,845
SHAREHOLDERS
Dividend - (2000 - 8.5c per - - 536
share)
Earnings per share (US 4 5.2c 15.0c 29.3c
cents) - basic
Headline earnings per share 4.3c 1.2c 8.2c
(US cents)
Changes in equity
Net profit for the period 334 944 1,845
Revaluations (38) (127) 2,630
Exchange differences (742) 13 (4,030)
Proposed dividend - - (536)
Total recognised (losses) (446) 830 (91)
/profits
Shareholders funds at start 24,600 24,691 24,691
of period
Shareholders funds at end of 24,154 25,521 24,600
period
Consolidated group balance sheet
31st March 30th September
2001 2000 2000
Unaudited Unaudited
Notes US$000 US$000 US$000
Fixed assets
Tangible fixed assets 20,943 19,395 21,633
Investments 6 16,588 19,769 17,391
37,531 39,164 39,024
Current assets
Inventories 5,170 5,886 5,176
Debtors 4,033 4,102 4,118
Cash 1,362 1,597 1,493
10,565 11,585 10,787
Current liabilities
Creditors (falling due (10,115) (11,956) (10,786)
within one year)
Net current assets 450 (371) 1
Total assets less current 37,981 38,793 39,025
liabilities
Creditors (falling due after (3,702) (3,791) (3,876)
more than one year)
Provisions for liabilities (2,414) (2,276) (2,654)
and deferred taxation
31,865 32,726 32,495
Capital and reserves
Share capital 9,450 9,450 9,450
Share premium 2,411 2,411 2,411
Other reserves 6,493 8,090 6,760
Retained earnings 5,800 5,570 5,979
Shareholders' funds 24,154 25,521 24,600
Minority interests 7,711 7,205 7,895
31,865 32,726 32,495
Shareholders funds including 6 32,659 33,899 32,205
listed investments at market
value
Net assets per share 6 US$5.18 US$5.38 US$5.10
Consolidated cash flow statement
Half years ended Year ended
31st March 30th
September
2001 2000 2000
Unaudited Unaudited
US$000 US$000 US$000
Operating activities
Cash (absorbed by)/generated (109) (2,694) 51
from operating activities
Interest paid (343) (502) (1,309)
Taxation paid (311) (562) (520)
Net cash outflow from (763) (3,758) (1,778)
operating activities
Investment activities
Purchase of tangible fixed (158) (307) (1,025)
assets
Purchase of investments (210) (850) (3,005)
Disposal of tangible fixed - 112 1,430
assets
Disposal of investments 775 2,139 4,259
Interest received and other 274 260 635
investment income
Dividends received from 67 176 227
associates
Net cash inflow from investment 748 1,530 2,521
activities
Net cash (outflow)/inflow (15) (2,228) 743
before financing
Financing activities
Net decrease in long term (46) (68) 235
financing
Dividend paid - group - - (536)
- minority shareholders (8) - (76)
Net cash outflow from financing (54) (68) (377)
activities
Net (decrease)/increase in cash (69) (2,296) 366
Net debt at start of period (2,750) (3,487) (3,487)
Effect of foreign exchange 179 - 371
rates
Net debt at end of period (2,640) (5,783) (2,750)
Notes to the interim statement
1. The results and the cash flow statement for the half-year ended 31st
March 2001 are unaudited and have been prepared on the basis of accounting
policies adopted in the accounts for the year ended 30th September 2000 and
comply with International Accounting Standards and Luxembourg law in all
material respects. The results for the year to 30th September 2000 are an
abridged version of the group's full accounts for that year which received
an unqualified auditor's report and have been filed with the relevant
authorities.
2. The segmental analysis of turnover and operating profit is as follows: -
Half years ended 31st March Year ended 30th
September
2001 2000 2000
US$000 US$000 US$000
Revenue Result Revenue Result Revenue Result
Analysed by
activity:-
Property 761 272 758 269 1,474 534
Import/distribution 7,323 415 7,146 440 15,704 851
Farming 1,540 7 1,147 19 5,188 401
Gold mining 967 140 914 291 2,042 346
Other - (78) 84 (162) 643 (97)
10,591 756 10,049 857 25,051 2,035
Share of associated
companies results:-
Farming 12,518 451 12,232 372 20,365 899
Gold mining 4,870 (177) 5,006 (232) 10,020 (283)
Group revenue 27,979 27,287 55,436
including
associates
Interest paid (343) (392) (1,309)
Profit before 687 605 1,342
exceptional items
Exceptional items 83 1,511 1,948
Profit before tax 770 2,116 3,290
3. The exceptional items arise from the surplus on disposal of investments
and tangible fixed assets. Exceptionals are substantially below the
comparative period because of the sale of Kent Estate in 1999, which
realised a profit of US$1,181,000, and lower profits on realisation of
investments in the first half of the current year.
31st March 30th September
2001 2000 2000
US$000 US$000 US$000
Surplus on disposal of listed and 104 323 992
unlisted investments
(Deficit)/Surplus on disposals of (32) 1,208 901
tangible fixed assets
Share of associated company's surplus on 11 - 55
disposal of fixed assets
Investment provisions - (20) -
Exceptional items - net income 83 1,511 1,948
4. Earnings per share are based on profits attributable to members and on
the average of 6,300,000 shares in issue during the period, allowing for the
shares held in Treasury. Headline earnings per share exclude extraordinary
items after tax.
5. Net assets
Investments at book value 16,588 19,769 17,269
Listed investments at market value and 25,093 28,147 24,874
other investments at cost
Net unrealised profits on investments 8,505 8,378 7,605
(before tax)
Shareholders' funds 24,154 25,521 24,600
Net assets attributable to shareholders 32,659 33,899 32,205
6. Net assets per share are based on Shareholders' funds plus net unrealised
profits on investments (before tax) divided by the number of shares in issue
at the period end.
7. Capital expenditure during the period was US$158,000. Capital
expenditure not provided but contracted, and authorised but not contracted,
as at 31st March 2001 amounted to US$20,000 and US$18,000 respectively.
