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TBS 201605240002A
Unaudited group results and dividend declaration for the six months ended 31 March 2016
Tiger Brands Limited
Registration number: 1944/017881/06
Incorporated in the Republic of South Africa
Share code: TBS
ISIN: ZAE000071080
Unaudited group results and dividend declaration for the six months ended 31 March 2016
Highlights
Continuing operations deliver a solid underlying performance
- Group turnover* up 9% to R15,9 billion
- Group operating income* up 7% to R2,1 billion
- EPS* up 7% to 1 021 cents
- HEPS* unchanged at 978 cents
- Interim dividend per share up 7% to 363 cents
- Total EPS up 26% to 1049 cents
- Total HEPS up 14% to 975 cents
* From continuing operations
Commentary
Overview
The group achieved solid results for the six months ended 31 March 2016, notwithstanding the significant
inflationary cost pressures experienced in the Milling and Baking businesses. Soft commodity prices, particularly in Maize
and Sorghum, were severely impacted by rand weakness and the effects of the drought in Southern Africa. The balance of the
group?s domestic businesses reflected a solid underlying performance, while the International segment benefited from the
turnaround of Haco Tiger Brands (Haco) and a strong performance from the Deciduous Fruit (LAF) business.
The group?s interest in Tiger Branded Consumer Goods Plc (TBCG), formerly Dangote Flour Mills Pls, was disposed of with effect
from 25 February 2016. Consequently, TBCG has been treated as a discontinued operation in these results, with the
comparative information restated accordingly.
Group turnover from continuing operations increased by 9% to R15,9 billion (2015: R14,6 billion), while operating
income before abnormal items and IFRS 2 charges increased by 7% to R2,1 billion (2015: R1,9 billion). This was achieved
notwithstanding a 23% increase in marketing investment from R409 million to R502 million, in line with the group?s strategic
objective to sustain the strength of its brands.
Income from associates of R371 million, which includes a capital profit of R72 million relating to the disposal of
certain assets by Carozzi, increased by 56% compared to the prior year, reflecting a strong underlying performance by all
of the associate companies.
Net financing costs of R118 million (2015: R116 million), which are after foreign exchange gains of R32 million
relating to foreign cash holdings and loan balances, reflect the higher domestic interest rates in the current period. The
comparative figure of R116 million has been restated to include the effect of foreign exchange losses of R5 million on
foreign cash holdings and loan balances.
Profit before tax from continuing operations increased by 15% to R2,3 billion (2015: R2,0 billion). Attributable
earnings, which increased by 8%, were impacted by a significantly higher effective tax rate in the current period of 30,6%
(2015: 25,9%), as well as the outside shareholder?s share of losses incurred by Haco in the prior year changing to a share
of profit in the current period.
Earnings per share from continuing operations increased by 7% to 1 021 cents (2015: 954 cents) while headline earnings
per share from continuing operations was in line with the prior period at 978 cents (2015: 975 cents).
Including discontinued operations, total earnings per share increased by 26% to 1049 cents (2015: 832 cents) while total
headline earnings per share increased by 14% to 975 cents (2015: 853 cents).
Operating performance
Grains
Turnover in the Grains division increased by 10% to R6,2 billion (2015: R5,6 billion), while operating income declined
by 1% from R890 million to R881 million. The Millbake wheat value chain posted unchanged earnings while there was a
decline in the contribution from Maize and Sorghum. The period under review was characterised by significant inflation in
raw material inputs and intense competition, which adversely impacted volumes and margins. Marketing investment increased
by 36% to R173 million (2015: R127 million), driving visibility and brand awareness in an extremely competitive
environment.
Overall volume within the Milling and Baking categories declined by 2%, driven primarily by Maize and Sorghum.
However, turnover increased by 9% to R4,3 billion (2015: R3,9 billion), mainly due to the effects of inflation, while operating
income declined by 4% to R710 million (2015: R736 million).
Other Grains reflected solid growth, increasing total volumes by 4% and operating income by 11% to R171 million
(2015: R154 million).
Consumer Brands - Food
The Consumer Brands Food businesses delivered a satisfactory performance in the period under review, other than the
Snacks & Treats category. Turnover increased by 8% to R5,8 billion (2015: R5,3 billion) while operating income grew by 4%
to R609 million (2015: R585 million). These businesses were not immune to the significant cost pressures resulting
from the weaker rand. Careful management of price positioning in a competitive market resulted in good volume growth in the
Groceries, Beverages, Out of Home and Value Added Meat Product categories and operating income for
these categories grew by 11%. The aggregate profit growth for the Consumer Brands Food businesses of 4%, was negatively
impacted by the under performance of Snacks & Treats where operating income declined by 12%.
The Groceries business continued on its path to recovery and delivered a strong operating performance, underpinned by
good volume.
Volumes in Snacks & Treats declined by 3%, while turnover remained flat at R1,1 billion as the sugar category came
under increasing competitive pressure during the period. The business faced a number of technical challenges in the Gums
and Jellies plant, which resulted in supply constraints. This, together with an unfavourable sales mix, resulted in a 12%
decline in operating income to R147 million (2015: R167 million).
The Beverages business achieved strong top-line growth of 17% to R758 million (2015: R648 million), which was
underpinned by excellent volume growth across the Oros, Energade and Rose?s brands. Operating income grew by 10% to
R105 million (2015: R96 million), reflecting increasing pressure on margins due to above inflationary increases in raw material
costs which had to be partially absorbed to counter intense competitive activity.
The Value Added Meat Products (VAMP) business delivered a pleasing performance, with turnover up 3% to R1,1 billion
(2015: R1,1 billion) and operating income up 10% to R77 million (2015: R70 million), primarily attributable to improved
pricing and disciplined cost control.
Home, Personal Care and Baby (HPCB)
HPCB?s strong performance was driven mainly by the Home Care and Baby categories, with overall turnover increasing by
13% to R1,3 billion (2015: R1,2 billion) and operating income increasing by 18% to R272 million (2015: R231 million).
The Home Care category (excluding Stationery) produced an excellent performance and achieved top-line growth of 27%.
This was underpinned by exceptional volume growth within the Pest, Sanitary and Air Care segments, due to strong market
demand, expansion of in-store presence and optimal pricing. Operating income increased by 115% to R103 million
(2015: R48 million), benefiting from the increase in volumes and a favourable product mix.
Purity maintained its leading brand position in the homogenised baby food segment, increasing its share of the fast
growing pouch segment, which now accounts for around 8% of total category volumes. Volumes declined as a result
of lower promotional discounts compared to the prior period as well as down-trading within the cereals segment
in favour of more affordable soft porridges. Turnover for the Baby category increased by 9% to R443 million
(2015: R407 million), while operating income increased by 13% to R115 million (2015: R102 million).
Volumes in the Personal Care category were negatively affected by increased competitor activity which resulted in
unchanged turnover of R303 million compared to the corresponding prior period (2015: R300 million). Operating income
declined by 38% to R47 million (2015: R75 million), impacted by pressure on volumes, an unfavourable sales mix and a
significantly higher marketing spend of R35 million (2015: R19 million).
Exports and International
Total turnover for the Exports and International businesses rose by 8% to R2,6 billion (2015: R2,5 billion), while
operating income increased by 34% to R292 million (2015: R219 million), largely driven by the profit recovery at Haco.
Chococam achieved excellent growth in operating income (up 11% in constant currency terms), driven by strong volume
growth and tight cost management, despite significantly higher raw material costs. In rand terms, Chococam?s operating
income grew by 33% to R68 million, benefiting from the effects of the weak rand.
Both of the East African businesses, Kenyan-based Haco and Ethiopian-based EATBI, reported strong volume growth during
the period. Following last year?s losses, Haco achieved a profit turnaround while EATBI improved its operating
performance in a difficult macro-economic environment.
Deli Foods, which is based in Nigeria, continues to face a tough economic environment, with the constraints on
disposable incomes limiting the ability to recover the significant increase in raw material costs due to the devaluation
of the naira.
The Exports business was negatively impacted by local currency devaluation and foreign currency shortages in a number
of African countries, resulting in a slowdown in customer demand. Also contributing to the lower turnover was the impact
of reduced sales into Mozambique which recommenced in November 2015, following the appointment of a new distributor.
The Deciduous Fruit business (LAF) achieved 3% volume growth and 2% pricing inflation in foreign currency terms.
Partly as a result of rand weakness, turnover grew by 27% to R808 million (2015: R636 million), while operating income
increased by 153% to R93 million (2015: R37 million).
Cash flow and capital expenditure
Cash generated from operations improved by 31% to R1,9 billion, due to improved working capital management
notwithstanding the adverse impact of inflation on inventory and debtor levels. Capital expenditure incurred during the
period amounted to R257 million (2015: R363 million). Overall, net interest-bearing debt was reduced by R1,1 billion, primarily
as a result of the disposal of TBCG.
Interim dividend
The company has declared an interim dividend of 363 cents per share for the six months ended 31 March 2016,
which represents an increase of 7% compared to the previous interim dividend of 339 cents per share. Shareholders are
referred to the dividend announcement below for further details.
Outlook
The outlook for the balance of the year remains challenging, with downside risk to the macro-economic environment,
both in South Africa and in a number of African markets, likely to add further pressure on consumers. This
will be exacerbated by increased inflationary pressures in the second half, when the full impact of the rand?s depreciation
on the group?s domestic cost base will be felt. Against this background, we remain focused on the quality and strength
of our brands and on our ability to deliver value to our consumers in a cost-effective manner. The key challenge will be
to maintain volume momentum notwithstanding price increases that are currently being taken to partly offset the cost
pressures referred to above.
By order of the board
A C Parker
Chairman
L C Mac Dougall
Incoming Chief Executive Officer
N P Doyle
Chief Operating Officer
Bryanston
Date released: 24 May 2016
Declaration of interim dividend
The board has approved and declared an interim dividend of 363 cents per ordinary share (gross) in respect of the six
months ended 31 March 2016.
The dividend will be subject to the Dividends Tax that was introduced with effect from 1 April 2012.
In accordance with paragraphs 11.17 (a) (i) to (x) and 11.17 (c) of the JSE Listings Requirements the following
additional information is disclosed:
- The dividend has been declared out of income reserves
- The local Dividends Tax rate is 15% (fifteen per centum)
- The gross local dividend amount is 363 cents per ordinary share for shareholders exempt from the Dividends Tax
- The net local dividend amount is 308,55 cents per ordinary share for shareholders liable to pay the Dividends Tax
- Tiger Brands has 192 069 868 ordinary shares in issue (which includes 10 326 758 treasury shares), and
- Tiger Brands Limited?s income tax reference number is 9325/110/71/7.
Shareholders are advised of the following dates in respect of the interim dividend:
Last day to trade cum the interim dividend Friday, 24 June 2016
Shares commence trading ex the interim dividend Monday, 27 June 2016
Record date to determine those shareholders entitled to the interim dividend Friday, 1 July 2016
Payment in respect of the interim dividend Monday, 4 July 2016
Share certificates may not be dematerialised or re-materialised between Monday, 27 June 2016 and Friday, 1 July 2016,
both days inclusive.
By order of the board
T Naidoo
Secretary
Sandton
Date released: 24 May 2016
Interim condensed consolidated income statement
R?million Note Unaudited Change Unaudited Unaudited
six months % six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015 Restated*#
Restated*#
Turnover 15 893,5 9 14 565,9 28 660,0
Cost of sales (10 769,1) (10) (9 770,6) (18 980,5)
Gross profit 5 124,4 7 4 795,3 9 679,5
Sales and distribution expenses (1 818,6) (5) (1 737,7) (3 425,7)
Marketing expenses (502,4) (23) (409,4) (809,5)
Other operating expenses (794,2) (4) (766,6) (1 418,6)
Operating income before abnormal items 2 2 009,2 7 1 881,6 4 025,7
Abnormal items 3 (3,2) 92 (41,4) (338,5)
Operating income after abnormal items 7 2 006,0 9 1 840,2 3 687,2
Net finance costs 8 (117,6) (2) (115,8) (204,0)
Investment income 0,4 - 0,4 0,8
Income from associated companies 370,6 56 237,5 602,8
Profit before taxation 2 259,4 15 1 962,3 4 086,8
Taxation (579,4) (27) (457,1) (977,3)
Profit for the period from continuing operations 1 680,0 12 1 505,2 3 109,5
Profit for the period from discontinued operation 6 27,6 109 (315,7) (2 167,5)
Profit for the period 1 707,6 44 1 189,5 942,0
Attributable to:
Owners of the parent 1 703,3 27 1 339,4 1 727,1
- Continuing operations 1 658,9 8 1 535,2 3 121,4
- Discontinued operation 44,4 123 (195,8) (1 394,3)
Non-controlling interest 4,3 103 (149,9) (785,1)
- Continuing operations 21,1 170 (30,0) (11,9)
- Discontinued operation (16,8) 86 (119,9) (773,2)
1 707,6 44 1 189,5 942,0
Basic earnings per share (cents) 1 048,6 26 832,2 1 068,1
- Continuing operations 1 021,3 7 953,8 1 930,4
- Discontinued operation 27,3 122 (121,6) (862,3)
Diluted basic earnings per share (cents) 1 034,7 27 816,6 1 050,9
- Continuing operations 1 007,7 8 936,0 1 899,3
- Discontinued operation 27,0 123 (119,4) (848,4)
Headline earnings per share (cents) 974,6 14 852,9 1 785,5
- Continuing operations 977,8 - 974,6 2 091,0
- Discontinued operation (3,2) 97 (121,7) (305,5)
Diluted headline earnings per share (cents) 961,5 15 837,0 1 756,7
- Continuing operations 964,7 1 956,3 2 057,3
- Discontinued operation (3,2) 97 (119,3) (300,6)
* The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange
gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance
costs. Refer note 7 for further details.
# Restated as required by IFRS 5 in relation to the treatment of Tiger Branded Consumer Goods plc (TBCG) as a discontinued
operation.
Interim condensed consolidated statement of comprehensive income
R?million Unaudited Change Unaudited Unaudited
six months % six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015
Profit for the period 1 707,6 44 1 189,5 942,0
Other comprehensive income, net of tax 61,4 135 (175,8) 299,2
Net gain on hedge of net investment in
foreign operation 1 0,4 (97) 13,4 7,6
Foreign currency translation adjustments 1 (44,9) 72 (161,9) 90,5
Share of associates other comprehensive
income 1 131,7 - - 281,7
Net (loss)/gain on cash flow hedges 1 (14,7) (765) (1,7) 7,0
Net loss on available-for-sale financial assets 1 (11,1) 57 (25,6) (91,3)
Remeasurement raised in terms of IAS 19R - - - (14,5)
Tax effect - - - 18,2
Total comprehensive income for the period 1 769,0 75 1 013,7 1 241,2
Attributable to:
Owners of the parent 1 766,1 50 1 180,9 1 995,1
Non-controlling interest 2,9 102 (167,2) (753,9)
1 769,0 75 1 013,7 1 241,2
Note
1 Items that may be subsequently reclassified to profit or loss. During the current period, R99,1 million of the foreign currency
translation reserve, relating to TBCG, was reclassified to profit and loss (abnormal items), as well as R0,5 million on the
available-for-sale financial asset derecognised in terms of the Black Managers Trust Participation Rights Scheme was reclassified
to profit or loss.
Interim condensed consolidated statement of financial position
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015
ASSETS
Non-current assets 13 160,6 13 874,2 13 237,0
Property, plant and equipment 4 227,1 5 679,7 4 641,2
Goodwill 2 243,2 2 383,5 2 239,1
Intangible assets 1 991,8 2 059,8 1 993,9
Investments 4 641,5 3 447,7 4 312,3
Deferred taxation asset 57,0 303,5 50,5
Current assets 11 416,2 11 053,6 11 617,3
Inventories 5 856,7 5 308,1 5 670,0
Trade and other receivables 4 690,5 5 192,1 4 895,7
Cash and cash equivalents 869,0 553,4 1 051,6
Total assets 24 576,8 24 927,8 24 854,3
EQUITY AND LIABILITIES
Total equity 15 151,1 14 145,3 13 777,6
Issued capital and reserves 14 616,2 13 578,9 13 830,1
Non-controlling interests 534,9 566,4 (52,5)
Non-current liabilities 2 033,0 1 313,3 2 059,2
Deferred taxation liability 243,5 308,6 200,3
Provision for post-retirement medical aid 651,5 637,0 643,1
Long-term borrowings 1 138,0 367,7 1 215,8
Current liabilities 7 392,7 9 469,2 9 017,5
Trade and other payables 4 539,7 4 633,6 4 796,8
Provisions 395,4 565,9 523,3
Taxation 30,8 112,0 73,4
Short-term borrowings 2 426,8 4 157,7 3 624,0
Total equity and liabilities 24 576,8 24 927,8 24 854,3
Net debt 2 695,8 3 972,0 3 788,2
Interim condensed consolidated segmental information
R?million Unaudited Change Unaudited Unaudited
six months % six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015 Restated*
Restated*
Turnover
Domestic operations 13 252,7 9 12 114,6 23 630,6
Grains 6 157,7 10 5 611,6 11 375,4
Milling and baking 4 302,2 9 3 942,9 8 160,5
Other Grains 1 855,5 11 1 668,7 3 214,9
Consumer Brands - Food 5 788,4 8 5 341,2 10 108,1
Groceries 2 564,6 12 2 288,9 4 265,4
Snacks & Treats 1 116,8 - 1 113,4 2 137,1
Beverages 757,6 17 648,4 1 166,8
Value Added Meat Products 1 099,6 3 1 071,6 2 095,1
Out of Home 239,8 10 218,9 443,7
Home, Personal Care and Baby (HPCB) 1 316,6 13 1 161,8 2 147,1
Personal Care 303,4 1 299,6 630,9
Babycare 443,4 9 406,7 803,0
Homecare 569,8 25 455,5 713,2
Exports and International 2 640,8 8 2 451,3 5 029,4
Exports 790,2 (24) 1 038,3 1 872,4
International operations - Central Africa 439,5 26 349,8 706,5
International operations - East Africa 514,1 60 320,9 762,6
International operations - West Africa** 241,9 23 196,8 412,0
Deciduous Fruit (LAF) 807,6 27 636,3 1 434,0
Other intergroup sales (152,5) (68) (90,8) (158,1)
Continuing operations 15 893,5 9 14 565,9 28 660,0
Discontinued operation - TBCG** 1 598,5 19 1 341,7 2 897,6
Total turnover 17 492,0 10 15 907,6 31 557,6
Operating income before abnormal items
Domestic operations 1 758,7 4 1 698,6 3 593,2
Grains 881,1 (1) 889,6 2 060,8
Milling and baking 709,8 (4) 735,8 1 680,5
Other Grains 171,3 11 153,8 380,3
Consumer Brands - Food 609,2 4 584,7 1 095,9
Groceries 234,2 12 210,0 410,6
Snacks & Treats 147,0 (12) 166,8 314,9
Beverages 105,2 10 95,5 137,8
Value Added Meat Products 76,9 10 69,6 146,3
Out of Home 45,9 7 42,8 86,3
Home, Personal Care and Baby (HPCB) 272,0 18 230,9 443,6
Personal Care 47,0 (38) 75,2 129,7
Babycare 115,0 13 102,0 214,2
Homecare 110,0 105 53,7 99,7
Other (3,6) 45 (6,6) (7,1)
Exports and International 292,4 34 218,8 461,7
Exports 128,4 (40) 212,9 338,0
International operations - Central Africa 68,0 33 51,0 115,8
International operations - East Africa 35,7 151 (69,4) (46,5)
International operations - West Africa** (32,5) (162) (12,4) (38,2)
Deciduous Fruit (LAF) 92,8 153 36,7 92,6
Total operating income before IFRS 2 charges 2 051,1 7 1 917,4 4 054,9
IFRS 2 charges (41,9) (17) (35,8) (29,2)
Total operating income after IFRS 2 charges 2 009,2 7 1 881,6 4 025,7
Discontinued operation - TBCG** 63,2 126 (243,9) (392,5)
Total operating income 2 072,4 27 1 637,7 3 633,2
* The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange
gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance
costs. Refer note 7 for further details.
** Previously reported Nigeria segment has now been split between West Africa and the discontinued operation.
Interim condensed consolidated statement of changes in equity
R?million Share capital Non- Accumulated Shares held by
and premium distributable profits subsidiary and
reserves empowerment
entities
Balance at 1 October 2014 139,4 2 086,3 13 198,8 (2 671,9)
Profit for the period - - 1 339,4 -
Other comprehensive income - (158,5) - -
139,4 1 927,8 14 538,2 (2 671,9)
Issue of share capital and premium 9,1 - - -
Transfers between reserves - 86,9 (86,9) -
Share-based payment - - - -
Dividends on ordinary shares (net of dividend on treasury shares) - - (1 010,5) -
Sale of empowerment shares 1 - - - 182,8
Balance at 31 March 2015 148,5 2 014,7 13 440,8 (2 489,1)
Profit for the period - - 387,7 -
Other comprehensive income - 436,2 (9,7) -
148,5 2 450,9 13 818,8 (2 489,1)
Subsidiary legal reserve transfer - 3,3 (3,3) -
Transfers between reserves - 189,9 (98,5) -
Share-based payment - - - -
Dividends on ordinary shares (net of dividend on treasury shares) - - (564,1) -
Purchase of Tiger shares by empowerment entity - - - (71,0)
Sale of empowerment shares 1 - - - 21,2
Balance at 30 September 2015 148,5 2 644,1 13 152,9 (2 538,9)
Profit for the period - - 1 703,3 -
Other comprehensive income 2 - 62,8 - -
148,5 2 706,9 14 856,2 (2 538,9)
Transfers between reserves - 205,8 (205,8) -
Share-based payment - - - -
Dividends on ordinary shares (net of dividend on treasury shares) - - (1 022,2) -
Disposal of subsidiary - - - -
Sale of empowerment shares 1 - - - 11,3
Balance at 31 March 2016 148,5 2 912,7 13 628,2 (2 527,6)
Interim condensed consolidated statement of changes in equity (continued)
R?million Share-based Total attributable Non-controlling Total
payment to owners of interests equity
reserve the parent
Balance at 1 October 2014 424,8 13 177,4 769,8 13 947,2
Profit for the period - 1 339,4 (149,9) 1 189,5
Other comprehensive income - (158,5) (17,3) (175,8)
424,8 14 358,3 602,6 14 960,9
Issue of share capital and premium - 9,1 - 9,1
Transfers between reserves - - - -
Share-based payment 39,2 39,2 - 39,2
Dividends on ordinary shares (net of dividend on treasury shares) - (1 010,5) - (1 010,5)
Sale of empowerment shares 1 - 182,8 (36,2) 146,6
Balance at 31 March 2015 464,0 13 578,9 566,4 14 145,3
Profit for the period - 387,7 (635,2) (247,5)
Other comprehensive income - 426,5 48,5 475,0
464,0 14 393,1 (20,3) 14 372,8
Subsidiary legal reserve transfer - - - -
Transfers between reserves (91,4) - - -
Share-based payment 50,9 50,9 - 50,9
Dividends on ordinary shares (net of dividend on treasury shares) - (564,1) (19,4) (583,5)
Purchase of Tiger shares by empowerment entity - (71,0) - (71,0)
Sale of empowerment shares 1 - 21,2 (12,8) 8,4
Balance at 30 September 2015 423,5 13 830,1 (52,5) 13 777,6
Profit for the period - 1 703,3 4,3 1 707,6
Other comprehensive income 2 - 62,8 (1,4) 61,4
423,5 15 596,2 (49,6) 15 546,6
Transfers between reserves - - - -
Share-based payment 30,9 30,9 - 30,9
Dividends on ordinary shares (net of dividend on treasury shares) - (1 022,2) - (1 022,2)
Disposal of subsidiary - - 587,6 587,6
Sale of empowerment shares 1 - 11,3 (3,1) 8,2
Balance at 31 March 2016 454,4 14 616,2 534,9 15 151,1
Notes
1 Relates to the exercising of options vested post the December 2014 lock-in period in terms of the Black Managers Trust Participation Right Scheme.
2 During the current period, R99,1 million of the foreign currency translation reserve, relating to TBCG, was reclassified to profit and loss.
Interim condensed consolidated statement of cash flows
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015 Restated*
Restated*
Cash operating profit 2 344,3 2 164,2 4 396,4
Working capital changes (482,5) (744,7) (811,6)
Cash generated from operations 1 861,8 1 419,5 3 584,8
Finance cost net of dividends received 15,9 (38,7) (70,7)
Taxation paid (601,3) (605,7) (1 158,8)
Cash available from operations 1 276,4 775,1 2 355,3
Dividends paid (1 025,3) (1 046,7) (1 643,0)
Net cash inflow/(outflow) from operating activities 251,1 (271,6) 712,3
Purchase of property, plant and equipment (257,0) (363,3) (881,6)
Net cash on disposal of subsidiary 1 075,7 - -
BMT shares exercised 12,6 215,3 285,7
Investment acquired - - (525,4)
Other (5,7) 8,8 65,4
Net cash inflow/(outflow) from investing activities 825,6 (139,2) (1 055,9)
Proceeds from issue of share capital - 9,1 9,1
Long and short-term borrowings (repaid)/raised (8,7) (560,1) 66,9
Net cash (outflow)/inflow from financing activities (8,7) (551,0) 76,0
Net increase/(decrease) in cash and cash equivalents 1 068,0 (961,8) (267,6)
Effect of exchange rate changes 7,3 (33,7) 66,7
Cash and cash equivalents at the beginning of the period (2 126,8) (1 925,9) (1 925,9)
Cash and cash equivalents at the end of the period (1 051,5) (2 921,4) (2 126,8)
Cash resources 869,0 553,4 1 051,6
Short-term borrowings regarded as cash and cash equivalents (1 920,5) (3 474,8) (3 178,4)
(1 051,5) (2 921,4) (2 126,8)
* The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange
gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance
costs. Refer note 7 for further details.
Other salient features
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015
Capital commitments 730,3 479,6 1 119,4
- contracted 80,0 122,7 148,5
- approved 650,3 356,9 970,9
Capital commitments will be funded from normal
operating cash flows and the utilisation of existing
borrowing facilities. At 31 March 2016, the total
capital commitments proposed but not yet approved
amounted to R789,8 million.
Capital expenditure 257,0 363,3 881,6
- replacement 235,2 307,0 677,8
- expansion 21,8 56,3 203,8
Contingent liabilities
- guarantees and contingent liabilities 3,0 14,8 16,9
Notes
1. Basis of preparation and changes to the group?s accounting policies
The preparation of these results has been supervised by O Ighodaro, Chief Financial Officer of Tiger Brands Limited.
The condensed group interim consolidated financial statements for the six months ended 31 March 2016 have been prepared
in accordance with IAS 34 Interim Financial Reporting as issued by the IASB, the South African Companies Act No 71 of 2008
and the Listings Requirements of the JSE Limited. These statements have not been audited or reviewed.
The accounting policies adopted in the preparation of the interim consolidated financial statements are consistent with
those applied in preparation of the group?s annual consolidated financial statements for the year ended 30 September 2015.
A number of segments comprising international entities are included in the ?International Operations? portion of ?Exports
and International? as they individually do not meet the qualitative thresholds indicated in IFRS 8 Operating Segments. The
majority of the group?s financial instruments measured at fair value in terms of IFRS 13, are noted as level 1 hierarchy,
which are valued based on quoted market prices.
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015 Restated*
Restated*
2. Operating income before abnormal items
Depreciation (included in cost of sales and other operating expenses) (278,2) (250,1) (517,8)
Amortisation (6,3) (11,8) (23,8)
IFRS 2 (included in other operating expenses)
- Equity settled (30,9) (39,2) (90,1)
- Cash settled (11,0) 3,4 60,9
3. Abnormal items
Impairment of property, plant and equipment (3,2) (11,8) (39,8)
Impairment of intangible assets - (29,6) (280,0)
Other - - (18,7)
(3,2) (41,4) (338,5)
4. Impairment
Goodwill and indefinite life intangible assets are tested for impairment annually (as at 30 September) and when
circumstances indicate the carrying value may be impaired. The group?s impairment tests are based on the value-in-use
calculations. The key assumptions used to determine the recoverable amount for the different cash generating units were
disclosed in the annual consolidated financial statements for the year ended 30 September 2015. No impairment was
recognised at 31 March 2016 relating to goodwill and indefinite life intangible assets.
* The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange
gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance
costs. Refer note 7 for further details.
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015 Restated*
Restated*
5. Reconciliation between profit for the period and
headline earnings
Continuing operations
Profit for the year attributable to owners of the parent 1 658,9 1 535,2 3 121,4
Loss/(profit) on disposal of property, plant, equipment
and intangible assets 0,1 (1,5) 9,8
Impairment of property, plant and equipment 2,3 8,3 32,9
Impairment of intangible assets - 29,6 269,6
Other - - (49,7)
Headline earnings adjustment - Associates
- Profit on disposal of property, plant, equipment and
intangible assets (73,1) (3,0) (3,0)
1 588,2 1 568,6 3 381,0
Tax effect of headline earnings 19,5 2,9 (5,8)
Attributable to non-controlling interest - - -
Discontinued operation
Profit for the period attributable to owners of the parent 44,4 (195,8) (1 394,3)
Loss on sale of property, plant and equipment 0,1 - -
Profit on disposal of subsidiary (49,7) - -
Impairment of property, plant and equipment - - 900,3
(5,2) (195,8) (494,0)
Tax effect of headline earnings - - -
Attributable to non-controlling interest - - 309,2
* The comparatives have been restated for the retrospective reclassification relating to the treatment of
foreign exchange gains and losses on foreign cash and bank balances previously included in operating income
and now reclassified to finance costs. Refer note 7 for further details.
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015
6. Analysis of profit from discontinued operation
Profit for the period from discontinued operation
(attributable to owners of the Company)
Turnover 1 598,5 1 341,7 2 897,6
Expenses (1 535,3) (1 585,6) (3 290,1)
Operating income before abnormal items 63,2 (243,9) (392,5)
Abnormal items 49,7 - (1 371,1)
Operating income after abnormal items 112,9 (243,9) (1 763,6)
Finance costs (85,3) (79,3) (173,0)
Profit before taxation 27,6 (323,2) (1 936,6)
Taxation - 7,5 (230,9)
Profit for the period from discontinued operation 27,6 (315,7) (2 167,5)
Attributable to non-controlling interest 16,8 119,9 773,2
Attributable to owners of parent 44,4 (195,8) (1 394,3)
Cash flows from discontinued operation
Net cash inflows/(outflows) from operating activities 271,1 35,8 (57,3)
Net cash outflows from investing activities (38,6) (34,5) (116,8)
Net cash inflows/(outflows) from financing activities 89,0 (166,4) 33,5
Net cash inflows/(outflows) 321,5 (165,1) (140,6)
R?million Unaudited Unaudited Unaudited
six months six months year ended
ended ended 30 September
31 March 31 March 2015
2016 2015
7. Reclassification of foreign exchange gains and losses
All foreign exchange gains and losses relating to revaluation of foreign cash balances and loans of a funding
nature have been accounted for as finance related costs (refer note 8) and thus reclassified from operating
income and into finance costs (retrospective application with comparatives restated to reflect the reclassification).
The impact on the comparatives is as follows:
Operating income after abnormal items
As previously reported 1 590,9 1 944,1
Discontinued operation 243,9 1 763,6
Reclassification on finance costs 5,4 (20,5)
Restated operating income from continuing operations
after reclassification of finance costs 1 840,2 3 687,2
8. Net financing costs
Net interest paid (149,3) (110,4) (224,5)
Net foreign exchange gain/(losses) 31,7 (5,4) 20,5
Net financing costs (117,6) (115,8) (204,0)
Corporate information
TIGER BRANDS LIMITED
Registration number: 1944/017881/06
Incorporated in the Republic of South Africa
Share code: TBS ISIN: ZAE000071080
Independent non-executive directors
A C Parker (Chairman), B L Sibiya (Deputy Chairman), Y G H Suleman, S L Botha,
K D K Mokhele, M P Nyama, R D Nisbet, M Makanjee, M J Bowman, M O Ajukwu
Executive directors
L C Mac Dougall (Chief Executive Officer) (appointed 10 May 2016),
C F H Vaux, O Ighodaro (Chief Financial Officer), N P Doyle (Chief Operating Officer)
Company Secretary
T Naidoo
Investor relations
N Catrakilis-Wagner (011) 840 4841
Postal address
PO Box 78056, Sandton, 2146, South Africa
Telephone (011) 840 4000
Sponsor
JP Morgan Equities South Africa (Pty) Limited
1 Fricker Road, Corner Hurlingham Road, Illovo, 2196
Share registrars
Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, 2001 PO Box 61051, Marshalltown 2107,
South Africa.
Telephone (011) 370 5000
Telephone: 011 840 4000
Facsimile: 011 514 0477
Physical address: Tiger Brands Limited
3010 William Nicol Drive, Bryanston
Postal address: PO Box 78056, Sandton
2146, South Africa
Website: www.tigerbrands.com
Date: 24/05/2016 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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