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Lonrho Africa Plc -
Lonrho Africa Plc
ISIN: GB0002568813
Share code: LAF
Interim Statement
Operating Review
During the period under review, the Group continued the disposal
programme of the remaining assets in Africa. At the same time, the Board
investigated new business opportunities in the United Kingdom.
Motors
The High Court action instituted by certain Commercial Paper holders in
Lonrho Motors East Africa Limited (in Receivership) has been settled
with the claims being withdrawn and without any admission of liability
on the part of Lonrho Africa and two of its former Directors.
We completed the sale of Lonrho Africa"s shareholding in Lonrho Motors
BV in December 2002. This represented our shareholding in W. Dahmer &
Co., our bus building business in Zimbabwe. Proceeds of GBP0.7 million
have been banked in the UK.
This sale marks the Group"s exit from its African motor operations.
Timber
The remaining wattle extract stocks in Kenya have now been sold.
Ranching
Livestock operations on the Ol Pejeta ranch continue to incur a small
loss. This is due primarily to depressed wholesale prices for beef and
lamb in Kenya. Potential buyers continue to express interest in the
ranch.
Hotels
The Hotel division suffered a pre-tax loss of GBP0.4 million (2002:
GBP0.2 million loss). This was linked to a fall in visitor arrivals
following the hotel bombing in Mombasa last November and the war in
Iraq. While the occupancy rate of 42% was in line with the first half of
2002, yields declined as a result of discounting in all markets.
Kenya
Occupancy levels in the hotels in Kenya dropped by 4% to 37%, despite an
initial increase in the first quarter of the financial year. As a
result, costs, headcount and capital expenditure continue to be strictly
monitored.
More recently, the suspension of British Airways" flights to Nairobi has
had a considerable negative effect on all the hotels in Kenya.
Ghana
The occupancy rate at the Labadi Beach hotel in Ghana was in line with
the previous year at 70%, despite the loss of the Lufthansa crew
contract. Business traffic, especially from the USA, has not yet shown
any signs of returning to the pre-Iraq war levels.
Mozambique
The Cardoso hotel in Mozambique had occupancy levels of 42%, up from 36%
in 2002, driven mainly by an increase in conference-related
accommodation. However, room rates have suffered, primarily as a result
of the strong South African Rand. During the past four years the supply
of hotel rooms in Maputo has increased by 50%, while demand has only
increased by 20%.
Property
The sale of agricultural land in Kenya continues, albeit at a slower
pace.
The market for industrial property in South Africa remains flat, but
efforts to dispose of our portfolio continue. The strengthening of the
South African Rand in the period resulted in a significant exchange
gain.
A lake-front property was sold in Malawi, leaving two relatively small
properties on the market.
Joint Venture
The sale of the Lonrho Africa shareholding in Kariba Minerals, Zambia,
still awaits Government approval.
Pension Scheme
As previously reported, discussions continue with the Trustee of the
Pension Scheme of one of the Group"s subsidiary companies on how to
reduce the existing statutory surplus in the scheme.
For further information please contact:
Nadja CardewChancery Tel: 020 7930 0777
Vetter
Mobile: 07941 340 436
Basis of preparation of the interim financial information
The interim financial information set out on pages 4 to 9 has been
prepared on the same basis and using the same accounting policies as
were applied in drawing up the statutory accounts for the year ended
30 September 2002. The figures for the six months to 31 March 2003 and
31 March 2002 are unaudited. The figures for the year ended 30
September 2002 do not constitute the statutory accounts for that year
which have been filed with the registrar of companies and on which the
auditors" report was unqualified without any statement under Section 237
of the Companies Act 1985.
Going Concern
The Directors continue to adopt the going concern basis in preparing the
financial statements as the Group continues to dispose of its assets in
accordance with the Board"s strategy.
Bank facilities remain uncommitted but the principal lenders have an
agreed repayment schedule based on a share of disposal proceeds and
sufficient progress has been made for the Directors to believe that the
support of the principal lenders will remain in place.
Asset Values
In preparing the financial statements the Directors have reviewed the
carrying values of both fixed and current assets in light of the current
economic uncertainties, and have made such adjustments, as they consider
reasonable and prudent.
Consolidated profit and loss account
6 months 6 months 6 months 6 months
to 31.3.03 to 31.3.03 to 31.3.03 to 31.3.02
Continuing Discontinued Continuing
Operations Operations Total Operations
Note GBPm GBPm GBPm GBPm
Turnover
Group 5.8 - 5.8 6.2
Joint ventures 0.2 - 0.2 0.2
6.0 - 6.0 6.4
Group net (6.5) - (6.5) (6.7)
operating costs
Operating (loss)
/ profit
Group (0.7) - (0.7) (0.5)
Joint ventures 0.1 - 0.1 0.1
(0.6) - (0.6) (0.4)
Non operating
exceptionals
Profit/(loss) on
sale or
termination of
operations 2 - 0.4 0.4 -
Exchange
gains/(losses) - 1.2 1.2 -
Net interest (0.1) - (0.1) (0.1)
payable
(Loss)/profit
before taxation (0.7) 1.6 0.9 (0.5)
Taxation (0.1) - (0.1) (0.1)
(Loss)/profit
after taxation (0.8) 1.6 0.8 (0.6)
Minority 0.1 - 0.1 -
interests
Retained (0.7) 1.6 0.9 (0.6)
(loss)/profit
Profit/(loss)
per share
(basic and 0.6p
diluted)
Loss per share
before
exceptional
items (basic and (0.4)p
diluted)
6 months 6 months 12 months
to 31.3.02 to 31.3.02 To 30.9.02
Discontinued
Operations Total Total
Note GBPm GBPm GBPm
Turnover
Group 8.4 14.6 21.1
Joint ventures - 0.2 0.2
8.4 14.8 21.3
Group net (9.2) (15.9) (20.8)
operating costs
Operating (loss)
/ profit
Group (0.8) (1.3) 0.3
Joint ventures - 0.1 0.1
(0.8) (1.2) 0.4
Non operating
exceptionals
Profit/(loss) on
sale or
termination of
operations 2 (0.2) (0.2) (0.3)
Exchange
gains/(losses) (0.5) (0.5) (1.0)
Net interest (0.1) (0.2) (0.3)
payable
(Loss)/profit
before taxation (1.6) (2.1) (1.2)
Taxation (0.1) (0.2) (0.3)
(Loss)/profit
after taxation (1.7) (2.3) (1.5)
Minority - - (0.1)
interests
Retained (1.7) (2.3) (1.6)
(loss)/profit
Profit/(loss)
per share
(basic and (1.5)p (1.0)p
diluted)
Loss per share
before
exceptional
items (basic and (0.9)p (0.5)p
diluted)
Earnings per share
Profit per share (basic and diluted of 0.6p (2002 - loss (1.5)p)) has
been calculated using the profit after taxation and minority interest of
GBP0.9 million (2002 - loss GBP(2.3) million) applied to 157,572,088
shares.
Loss per share before exceptional items of (0.4)p (2002 - (0.9)p) has
been calculated on the profit after taxation and minority interest but
before exceptional items applied to 157,572,088 shares.
Note: The figures for the six months ended 31 March 2002 have been
restated to reflect operations that have been discontinued since 31
March 2002.
Group balance sheet
31March 31 March 30September
2003 2002 2002
As restated
Note GBPm GBPm GBPm
Fixed assets
Tangible 31.1 37.0 31.2
Investments :
Joint ventures 0.3 0.2 0.3
31.4 37.2 31.5
Current assets
Stocks 1.9 4.2 1.9
Debtors
Amounts falling due within
one year 3.7 7.9 4.7
Amounts falling due 3 8.1 8.4 8.1
after one year
11.8 16.3 12.8
Cash at bank 3.5 4.2 4.9
17.2 24.7 19.6
Creditors: amounts falling
due within one year
Overdrafts (6.3) (8.5) (7.0)
Other creditors (4.3) (10.3) (5.4)
Net current assets 6.6 5.9 7.2
Total assets less current 38.0 43.1 38.7
liabilities
Provisions for liabilities (5.4) (6.7) (6.5)
and charges
Net assets 32.6 36.4 32.2
Capital and reserves
Called up share capital 31.5 31.5 31.5
Revaluation reserve 16.0 19.2 15.9
Other reserves 68.2 48.1 58.2
Profit and loss account (87.9) (68.0) (78.4)
Shareholders" funds 27.8 30.8 27.2
Minority interests (equity) 4.8 5.6 5.0
32.6 36.4 32.2
Note: In 2002 a prior year adjustment in respect of the implementation
of FRS19 Deferred Tax was made. The comparative figures for the period
ended 31st March 2002 have been restated accordingly.
Consolidated cash flow statement
6 months 6 months 12 months
to to to
31.3.03 31.3.02 30.9.02
Note GBPm GBPm GBPm GBPm GBPm GBPm
Net cash flow
from operating
activities
- continuing - 0.1 0.1
operations
- discontinued (0.4) 1.0 0.2
operations
_____ ____ ____
1 (0.4) 1.1 0.3
Return on
investments and
servicing of
finance
- interest - 0.1 0.1
received
- interest paid (0.1) (0.3) (0.4)
Tax paid - (0.1) (0.3) (0.3)
overseas
Net cash (0.6) 0.6 (0.3)
(outflow)/inflow
before investing
activities
Net capital 1 0.1 1.0 3.4
receipts
Net proceeds from 1 (0.1) (0.4) 0.4
disposal of
subsidiaries
Net cash (0.6) 1.2 3.5
(outflow)/inflow
before financing
Financing
Net repayment of - (1.1) (1.0)
bank loans
(Decrease)/increa 1 (0.6) 0.1 2.5
se in cash
Movement in net borrowings for the six months to 31 March 2003
1 October Net cash Exchange 31 March
2002 flows movement 2003
GBPm GBPm GBPm GBPm
Cash 4.9 (1.3) (0.1) 3.5
Overdrafts (7.0) 0.7 - (6.3)
Net borrowings (2.1) (0.6) (0.1) (2.8)
Statement of total recognised gains and losses
6 months
6 months to 31.3.02 12 months
to 31.3.03 As restated to 30.9.02
GBPm GBPm GBPm
Profit/(loss) for the 0.9 (2.3) (1.6)
period
Exchange adjustments (0.3) 0.7 (3.6)
Total recognised 0.6 (1.6) (5.2)
gains/(losses) in the
period
Prior year adjustment - (1.7) (1.7)
(see note below)
Total gains/(losses) in 0.6 (3.3) (6.9)
the period
Reconciliation of movements in shareholders" funds
6 months
6 months to 31.3.02 12 months
to 31.3.03 As restated to 30.9.02
GBPm GBPm GBPm
Recognised 0.6 (1.6) (5.2)
gains/(losses) relating
to the period
At beginning of period 27.2 32.4 32.4
(2002 figures restated)
At end of period 27.8 30.8 27.2
Historical cost profits and losses
6 months
6 months to 31.3.02 12 months
to 31.3.03 As restated to 30.9.02
GBPm GBPm GBPm
Historical cost
profit/(loss) before
taxation
Reported profit/(loss) 0.9 (2.1) (1.2)
before taxation
Difference between
historical cost
depreciation charge
and the actual
depreciation charge
calculated
on the revalued amount 0.1 0.1 0.1
Realisation of property 0.3 1.4 2.3
revaluation gains
Historical cost 1.3 (0.6) 1.2
profit/(loss) before
taxation
Historical cost
profit/(loss) after
taxation and
minority interests 1.3 (0.8) 0.8
Note: In 2002 a prior year adjustment in respect of the implementation
of FRS19 Deferred Tax was made. The comparative figures for the period
ended 31st March 2002 have been restated accordingly
Notes to the half-year accounts
1. Consolidated cash flow statement
6 months 6 months 6 months 6 months
to 31.3.03 to 31.3.03 to 31.3.03 to 31.3.02
Continuing Discontinued Continuing
operations Operations Total operations
Net cash flow
from operating GBPm GBPm GBPm GBPm
activities
Operating (0.7) - (0.7) (0.5)
(loss)/profit
Depreciation 0.5 - 0.5 0.7
charge
Reversal of
impairment of - - - -
fixed assets
(Increase)/ (0.1) - (0.1) 0.1
decrease in
stocks
Decrease in 0.1 1.0 1.1 0.3
debtors
Increase/ 0.2 (1.4) (1.2) (0.5)
(decrease) in
creditors
Net cash
(outflow)/inflow - (0.4) (0.4) 0.1
from operating
activities
6 months 6 months 12 months
to 31.3.02 to 31.3.02 to 30.9.02
Disco-
ntinued
operations Total Total
Net cash flow
from operating GBPm GBPm GBPm
activities
Operating (0.8) (1.3) 0.3
(loss)/profit
Depreciation 0.1 0.8 1.3
charge
Reversal of
impairment of - - (0.4)
fixed assets
(Increase)/ 0.4 0.5 0.6
decrease in
stocks
Decrease in 3.5 3.8 2.6
debtors
Increase/ (2.2) (2.7) (4.1)
(decrease) in
creditors
Net cash
(outflow)/inflow 1.0 1.1 0.3
from operating
activities
6 months 6 months 12 months
to 31.3.03 to 31.3.02 to 30.9.02
Net capital GBPm GBPm GBPm
receipts
Purchase of (0.1) (0.2) (0.2)
tangible fixed
assets
Sale of tangible 0.2 0.6 3.0
fixed assets
Sale of fixed - 0.6 0.6
asset investments
0.1 1.0 3.4
6 months 6 months 12 months
to 31.3.03 to 31.3.02 to 30.9.02
Net proceeds from GBPm GBPm GBPm
disposal of
subsidiaries
Proceeds from 0.7 0.4 2.5
sales of
subsidiaries
Disposal and (0.8) (0.8) (2.1)
other closure
costs
(0.1) (0.4) 0.4
6 months 6 months 12 months
to 31.3.03 to 31.3.02 to 30.9.02
Reconciliation of GBPm GBPm GBPm
net cash flow to
movement in net
borrowings
(Decrease)/increa (0.6) 0.1 2.5
se in cash in the
period
Cash inflow from - 1.1 1.0
changes in
financing
Change in net (0.6) 1.2 3.5
debt arising from
cash flows
Exchange rate (0.1) 0.2 0.1
movements
Movement in net (0.7) 1.4 3.6
borrowings
Balance at (2.1) (5.7) (5.7)
beginning of
period
Net borrowings (2.8) (4.3) (2.1)
2. Non operating exceptionals
6 months 6 months 12 months
to 31.3.03 to 31.3.02 to 30.9.02
Discontinued Discontinued
operations operations
Total Total Total
GBPm GBPm GBPm
Profit/(loss) on
disposal of:
Motors 0.2 (0.4) (0.4)
Agribusiness - 0.5 0.5
Property - (0.3) -
Other disposal
and closure costs 0.2 - (0.4)
0.4 (0.2) (0.3)
Debtors
Amounts falling due after one year
Included in debtors is a pension scheme asset of GBP8.1 million (2002:
GBP8.1 million) which relates to a prepayment of contributions to the UK
pension scheme calculated under Statement of Standard Accounting
Practice No 24 ("SSAP24"). This prepayment would normally be realised by
suspending future contributions so that the prepayment would reverse as
pension liabilities increased. However, because the number of active
members has reduced in recent years this asset will not be realised for
some considerable time unless there is a return of cash to the company
by way of a modification order or new employees are introduced into the
scheme.
Date: 30/06/2003 01:10:25 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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