| Fri 27 Dec 2002, 15:01 | | Conafex Holdings Societe Anonyme - Unaudited revie |
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CONAFEX HOLDINGS SOCIETE ANONYME
(Incorporated in Luxembourg - RC Luxembourg No. B 17789)
Code: CNX ISIN: LU0011857306
Registered office
6 rue Adolphe Fischer, L-1520,
(PO Box 1361, L-1013)
Luxembourg
Reviewed results for the year ended 30th September 2002
Nature of Operations
Conafex is a pan African agri-resource group focused on horticulture, niche and
value-added agriculture. A high proportion of the Group`s produce is exported
to Europe. Currently, most of Conafex`s operations are located in Zimbabwe.
Overview.
- A mid-season drought throughout Zimbabwe adversely affected production volumes
for most agricultural enterprises.
- Ordinary black tea prices and production volumes were lower than the previous
year, whereas decaffeinated tea volumes and prices were excellent.
- The strong Euro materially improved "on farm" returns from flowers and a
record contribution was made by this division, particularly from breeder-
protected varieties.
- Production from irrigated food crops was satisfactory, but in general prices
did not protect margins in the face of rampant inflation.
- Tobacco volumes were down, US dollar prices were firm at the auctions but an
unrealistic Zimbabwe dollar exchange rate impaired profitability.
- Poultry, deciduous fruit, and macadamia nuts made a significant contribution.
- Operations in Zimbabwe were not unaffected by the political upheavals but no
serious dislocation was suffered.
- Cape Natural Tea Products, the herbal tea processor based in Cape Town, turned
in a good performance in the face of a general shortage of raw material. The
weakening South African Rand for most of the year benefited exports of herbal
teas to markets in Germany and Japan.
- Accord Services, which provides unique tea packaging solutions in the United
Kingdom, performed well in a subdued retail market.
Financial
The major portion of the Group`s earnings are derived from wholly owned
operations in Zimbabwe and more especially from our listed Zimbabwe associate,
Ariston Holdings Limited. In view of the lack of clarity in respect of exchange
rates pertaining in Zimbabwe, exacerbated by the recently announced foreign
exchange regulations, your Directors have deemed it prudent not to consolidate
earnings emanating from Zimbabwe or the assets utilised to generate those
earnings. Instead the audited financial results include the United States
dollar receipts from Zimbabwe.
As a guide and for information purposes only, we have prepared an unaudited
illustrative consolidated Group Profit and Loss Account and an unaudited
illustrative consolidated Group Balance Sheet which are set out below. These
illustrative figures have been prepared on a conservative basis by translating
the Profit and Loss Accounts of our Zimbabwe investments at the average of the
month end commonly used or "implied" exchange rates (Z$450:US$1; 2001:
Z$151:US$1) and the Balance Sheets at the closing "implied" exchange rates
(Z$720:US$1; 2001: Z$360:US$1). The official exchange rate was static for the
year at Z$55:US$1.
Our investment in Zimbabwe is recorded in the audited Balance Sheet at the year-
end net asset value of Zimcor Limited and the market value of our investment in
Ariston Holdings Limited converted at the closing "implied" exchange rate. This
has resulted in exceptional provisions being made against the carrying value of
these investments.
Prospects.
It is too early to forecast the year ahead for the Zimbabwean operations
particularly in the light of the recent exchange control regulations which limit
access by exporters to own generated foreign exchange proceeds. The dry El Ni$o
weather conditions forecast for the region will add to the challenges in the
year ahead. Operations on all of our agricultural properties in Zimbabwe are
continuing, albeit on a reduced scale, and to date the rainfall distribution has
been patchy.
Supplies of herbal teas in the Cape are forecast to return to normal following a
good rainy season in the Cape Province. The Group continues to seek
opportunities within the Region and Zambia has gained a reputation of being an
"up and coming" producer of exportable horticultural produce with an ideal
climate and the necessary infrastructure.
Post year end, a 25% stake has been acquired in Rose Blooms Zambia Limited,
which is a significant producer of cut flowers operating in close proximity to
Lusaka. Positive results are only expected from this project in 2004 as a
consequence of a rehabilitation programme.
Dividend
Under prevailing circumstances, particularly in relation to Zimbabwe, no
dividend is recommended by your directors this year.
MARK BURRELL
CHAIRMAN
24th December 2002
NOTICE OF MEETING
The Annual General Meeting will take place on Friday 28th March 2003 at 3.30
p.m. at the registered office of the Company, 6 rue Adolphe Fischer L-1520
Luxembourg. Copies of the annual report and accounts will be posted to
shareholders in February 2003.
Reviewed Consolidated Profit and Loss Account
FOR THE YEAR ENDED 30th SEPTEMBER 2002 2001 2001
Restated
US$000 US$000 US$000
Revenue 192 143 5,099
Operating costs (473) (526) (4,791)
Operating (loss)/profit (281) (383) 308
Share of associated companies` results 38 33 2,482
Income from investment in Zimbabwe 293 546 -
subsidiary - dividend
Income from investment in Zimbabwe 191 68 -
associate - dividend
Income from other investments - dividends - - 1
Interest receivable 4 18 54
Interest paid and similar charges (8) (98) (771)
Profit on ordinary activities before 237 184 2,074
exceptional items and tax
Exceptional items (see note below) (5,873) 47 580
(Loss)/Profit before tax and minority (5,636) 231 2,654
interests
Taxation on ordinary activities (118) (163) (550)
(Loss)/Profit after tax before minority (5,754) 68 2,104
interests
Minority interests - - (1)
(Loss)/Profit attributable to shareholders (5,754) 68 2,103
of the Group
(Loss)/Earnings per share US cents (50.1)c 0.6c 18.3c
Headline earnings per share 1.0c 0.2c 13.3c
Note : the exceptional item for 2002 is the write down of Zimbabwean assets.
The exceptional item in 2001 arose on the sale of fixed assets
Reviewed Consolidated Statement of Changes in Equity
Exchange differences on translation of the
financial statements of foreign entities (7) (1) (409)
Reduction in interest in associated - - (42)
company
Net loss not recognised in the income (7) (1) (451)
statement
Net (loss)/profit for the year (5,754) 68 2,103
Total recognised (loss)/profit and change (5,761) 67 1,652
in shareholders` funds
Opening shareholders` funds 16,781 16,714 16,723
Closing shareholders` funds 11,020 16,781 18,375
Reviewed Consolidated Balance Sheet
AT 30th SEPTEMBER 2002 2001 2001
Restated
Assets US$000 US$000 US$000
Non current assets
Property, plant & equipment - - 8,815
Investments 10,783 16,636 10,915
10,783 16,636 19,730
Current assets
Inventories - - 2,796
Accounts receivable 126 17 654
Cash and bank balances 643 555 560
769 572 4,010
Current liabilities
Accounts payable falling due within one (432) (327) (2,299)
year
Net current assets 337 245 1,711
Total assets less current liabilities 11,120 16,881 21,441
Non current liabilities
Accounts payable falling due after more (100) (100) (100)
than one year
Deferred taxation - - (2,540)
11,020 16,781 18,801
Capital and reserves
Called up share capital 16,744 16,744 16,744
Other reserves 36 32 (4,290)
Retained earnings (5,760) 5 5,921
Shareholders` funds 11,020 16,781 18,375
Minority interests - - 426
11,020 16,781 18,801
Reviewed Consolidated Cash Flow Statement
FOR THE YEAR ENDED 30th SEPTEMBER 2002
2002 2001 2001
Restated
US$000 US$000 US$000
Cash Flows from Operating Activities
Cash (utilised )/generated by operations (287) (78) 190
Interest paid (8) (98) (161)
Taxation paid (109) (170) (159)
Net cash outflow from operating activities (404) (346) (130)
Investment activities
Purchase of tangible assets - - (123)
Purchase of investments - (478) (478)
Disposal of tangible assets - 22 43
Disposal of investments 2 197 1,197
Increase in amounts due by associated - - (62)
company
Dividends received from Zimbabwe 293 546 -
subsidiary
Interest received and other investment 4 19 55
income
Dividends received from associates 191 68 297
Net cash inflow from investment activities 490 374 929
Net cash inflow before financing 86 28 799
Financing activities
Net increase in long term debt - 100 100
Foreign exchange cost of subsidiary`s - - (610)
dividend
Net cash inflow/(outflow) from financing - 100 (510)
activities
Net increase in funds 86 128 289
Net funds at start of year 555 427 19
Effect of foreign exchange rate changes 2 - 15
Net funds at end of year 643 555 323
Notes:
1. As described in the Chairman`s Review, the earnings, assets and liabilities
of Zimbabwe subsidiary companies have not been consolidated. Investments have
been reflected in accordance with IAS 39. The 2001 comparatives have been
restated. The results for the year ended 30th September 2002 and the balance
sheet at that date, which are unaudited, have otherwise been prepared on the
basis of accounting policies adopted for the year ended 30th September 2001. The
2001 comparatives prior to restatement do not comply with the requirements of
IAS 29 (Financial reporting in Hyperinflationary Economies). Otherwise the
financial statements comply with International Accounting Standards and
Luxembourg law in all material respects. The results, which have been reviewed
by the Company`s auditors, AGN-Horsburgh & Co., are unaudited. The auditors
opinion is unqualified and is available for inspection at the company`s
registered office.
2. Capital expenditure during the period was US$ Nil. At 30th September 2002,
there were no outstanding capital commitments.
3. Earnings per share are based on the results attributable to shareholders
and a weighted average number of shares in issue during the year - 11,484,127
(20010 - 11,484,127).
Group Offices
South Africa United Kingdom Zimbabwe
11 Sunbury Park, 25 City Road, 215 Fife Avenue/10th Street,
La Lucia 4051,Durban, London, (P.O. Box 2733),
(P.O. Box 4126, The Square, EC1Y 1BQ Harare, Zimbabwe
Umhlamga 4320)
Notes on the directors` illustrative statements:
The following statements are for illustrative purposes only and are referred to
in paragraph 3 - Zimbabwe, of the chairman`s statement above.
2. The following statements which have been reviewed by the Company`s auditors,
AGN-Horsburgh & Co., are unaudited. The auditors report, which is unqualified,
is available for inspection at the company`s registered address.
Illustrative Reviewed Consolidated Profit and Loss Account
FOR THE YEAR ENDED 30th SEPTEMBER 2002 2001
US$000 US$000
Group revenue including share of associated 6,092 5,809
companies
Less share of revenue of associated companies (4,430) (3,864)
Revenue 1,662 1,945
Operating costs (1,758) (2,077)
Operating loss (96) (132)
Share of associated companies` results 1,023 924
Profit on sale of fixed asset investments 469 188
Interest receivable 7 31
Interest paid and similar charges (536) (343)
Profit on ordinary activities before 867 569
exceptional items and tax
Exceptional items (see note below) (3,024) 52
(Loss)/Profit before tax and minority (2,157) 721
interests
Taxation on ordinary activities (383) (424)
(Loss)/Profit after tax before minority (2,540) 297
interests
Minority interests 2 (1)
(Loss)/Profit attributable to shareholders of (2,538) 296
the Group
(Loss)/Earnings per share US cents (22.1)c 2.6c
Headline earnings per share 4.2c 0.5c
Note : The Exceptional Item in 2002 is a provision against the carrying value of
the investment in Ariston Holdings Limited, our Zimbabwe associated company.
The exceptional item in 2001 arose on the sale of fixed assets.
Illustrative Reviewed Consolidated Statement of Recognised Gains and Losses
2002
US$000
Exchange differences on translation of the
financial statements of foreign entities (143)
Group share of revaluation of properties 6,957
Net gain not recognised in the income 6,814
statement
Net loss for the year (2,538)
Total recognised profit and increase in 3,520
shareholders` funds
Opening shareholders` funds 7,430
Closing shareholders` funds 10,950
Illustrative Reviewed Consolidated Balance Sheet
AT 30th SEPTEMBER 2002 2001
US$000 US$000
Assets
Non current assets
Property, plant & equipment (see note below) 8,018 1,347
Investments 3,485 6,310
11,503 7,657
Current assets
Inventories 329 427
Accounts receivable 317 224
Cash and bank balances 646 556
1,292 1,207
Current liabilities
Accounts payable falling due within one year (733) (880)
Net current assets 559 327
Total assets less current liabilities 12,062 7,984
Non current liabilities
Accounts payable falling due after more than (109) (100)
one year
Deferred taxation (236) (388)
11,717 7,496
Capital and reserves
Called up share capital 16,744 16,744
Other reserves (4,145) (10,130)
Retained earnings (1,649) 816
Shareholders` funds 10,950 7,430
Minority interests 767 66
11,717 7,496
Note : Following an independent valuation, property, plant and equipment
includes farming properties in Zimbabwe carried at a depreciated replacement
cost valuation of US$8,157,000. This does not necessarily represent a
realisable value for these assets. The value at 30th September 2002 is based on
an independent valuation in Zimbabwe dollars at 30th September 2000.
Sponsor: The Janus Corporation (Pty) Limited
Date: 27/12/2002 08:32:00 AM Produced by the JSE SENS Department
