| Wed 19 Nov 2003, 16:47 | | GROUP RESULTS AND DIVIDEND DECLARATION |
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TIGER BRANDS LIMITED - GROUP RESULTS AND DIVIDEND DECLARATION
Tiger Brands Limited
(Registration number 1944/017881/06)
(Incorporated in the Republic of South Africa)
Share code: TBS
ISIN: ZAE000023560
GROUP RESULTS AND DIVIDEND DECLARATION
The reviewed results for the year ended 30 September 2003 are set out below.
This report has been prepared using the same principles as contained in AC 127 -
Interim Financial Reporting. The principles adopted herein are consistent, in
all material respects, with those applied in the most recently published annual
financial statements, except as disclosed in note 5, and comply with the
requirements of Statements of South African Generally Accepted Accounting
Practice.
The unmodified review report issued by Ernst & Young on the condensed financial
statements contained in this preliminary report is available for inspection at
the company"s registered office.
GROUP INCOME STATEMENT
Year ended 30
September
2003 2002 Change
Rm Rm %
Notes Reviewed Audited
Revenue 23,039.1 20,181.9 14
Continuing operations 23,039.1 20,071.3 15
Discontinued operations 0.0 110.6
Operating income before 1 1,918.2 2,036.6 (6)
amortisation of
intangibles
Continuing operations 1,918.2 2,017.7 (5)
Discontinued operations 0.0 18.9
Amortisation of 2 20.2 3.9
intangibles
Operating income after 1,898.0 2,032.7 (7)
amortisation of
intangibles
Income from investments 48.7 33.9
Net financing costs (221.4) (274.5)
Profit before taxation and 1,725.3 1,792.1 (4)
abnormal items
Abnormal items 3 16.1 18.3
Profit before taxation 1,741.4 1,810.4 (4)
Income tax expense 548.9 577.8
Net profit after taxation 1,192.5 1,232.6 (3)
Income from associates 4 92.7 177.1 (48)
Minority interest (27.3) (49.5)
Dividends on preference (0.1) (0.1)
shares
Net profit for the year 1,257.8 1,360.1 (8)
Number of ordinary shares 167,466 166,792
in issue (000"s)
Weighted average number of
ordinary shares on which
headline earnings and 167,106 166,331
basic earnings per share
are based (000"s)
Headline earnings per 777.0 816.6 (5)
ordinary share (cents)
Diluted headline earnings 768.4 809.4 (5)
per ordinary share (cents)
Basic earnings per 752.7 817.7
ordinary share (cents)
Diluted basic earnings per 744.3 810.5
ordinary share (cents)
Dividends per ordinary 290.0 290.0 0
share (cents)
Interim dividend declared 79.0 79.0
Final dividend declared 211.0 211.0
post balance sheet date
Reconciliation between net
profit and headline
earnings
Rm Rm
Net profit for the year 1,257.8 1,360.1
Adjusted for:
Losses on sale or - 35.6
discontinuation of
operations, net
Profit on sale of fixed
assets, net of impairment
charge on fixed assets (17.4) (8.1)
Net loss/(profit) on sale
of interest in
subsidiaries
and joint ventures 10.5 (151.9)
Amount written off - 103.0
investments
Goodwill amortisation 11.4 2.8
Associates 37.4 3.2
Discontinuation of 35.0 -
operations
Other 2.4 3.2
Other (1.3) 13.6
Headline earnings for the 1,298.4 1,358.3 (4)
year
GROUP BALANCE SHEET
30 September
2003 2002
Rm Rm
Reviewed Audited
ASSETS
Non-current assets 4,544.4 4,109.9
Property, plant & equipment 1,631.4 1,454.3
Goodwill and other intangibles 454.7 44.0
Investments 2,264.0 2,333.8
Deferred tax asset 194.3 277.8
Current assets 6,652.3 6,408.9
Inventories 2,315.0 1,999.1
Accounts receivable 3,312.2 2,784.8
Cash and cash equivalents 1,025.1 1,625.0
TOTAL ASSETS 11,196.7 10,518.8
EQUITY AND LIABILITIES
Capital and reserves 3,336.8 2,728.8
Share capital and premium 721.4 696.4
Non-distributable reserves and accumulated 2,615.4 2,032.4
profits
Minority interest 132.2 121.0
Total non-current liabilities 3,004.8 3,009.3
Deferred tax liability 373.3 294.0
Provision for post-retirement medical aid 399.9 359.9
Long-term borrowings 2,231.6 2,355.4
Total current liabilities 4,722.9 4,659.7
Short-term borrowings 705.1 835.3
Taxation 350.7 390.4
Accounts payable 3,667.1 3,434.0
TOTAL EQUITY AND LIABILITIES 11,196.7 10,518.8
SEGMENTAL ANALYSIS
Year ended Year ended
30 September 30 September
2003 2002 Change
Rm % Rm % %
Reviewed Audited
Revenue - Continuing
Operations
FMCG - Domestic 9,644.6 40% 8,382.6 41% 15%
Domestic Food 8,528.7 36% 7,616.1 38% 12%
Meal Occasions 3,093.3 13% 2,767.3 13% 12%
Culinary 934.3 4% 898.1 4% 4%
Snacks & Treats 865.3 4% 820.1 4% 6%
Perishables 1,259.9 5% 739.1 4% 70%
Milling 2,375.9 10% 2,391.5 13% (1%)
Consumer Healthcare 1,115.9 4% 766.5 3% 46%
OTC Medicines 283.3 1% 259.9 1% 9%
Personal and Babycare 483.9 2% 406.1 2% 19%
Homecare 348.7 1% 100.5 0% 247%
Regulated Healthcare 916.1 4% 816.0 4% 12%
Branded Medicines 601.6 3% 614.2 3% (2%)
Generic Medicines 314.5 1% 201.8 1% 56%
Hospital Products 617.2 3% 483.4 2% 28%
Exports 620.8 3% 738.2 4% (16%)
Spar 10,121.1 43% 8,345.3 40% 21%
Fishing 1,703.9 7% 1,843.0 9% (8%)
Other 6.3 0% 6.3 0% 0%
23,630.0 100% 20,614.8 100% 15%
Less : Intragroup 590.9 543.5
Revenue
23,039.1 20,071.3
Operating Income -
Continuing Operations *
FMCG - Domestic 873.1 46% 751.6 36% 16%
Domestic Food 649.0 34% 591.6 28% 10%
Meal Occasions 287.1 15% 176.8 9% 62%
Culinary 48.6 3% 53.6 3% (9%)
Snacks & Treats 85.6 4% 72.4 4% 18%
Perishables 59.5 3% 6.8 0% 775%
Milling 168.2 9% 282.0 12% (40%)
Consumer Healthcare 224.1 12% 160.0 8% 40%
OTC Medicines 78.3 4% 73.9 4% 6%
Personal and Babycare 95.2 5% 77.9 4% 22%
Homecare 50.6 3% 8.2 0% 517%
Regulated Healthcare 386.0 20% 394.4 20% (2%)
Branded Medicines 299.1 15% 343.8 17% (13%)
Generic Medicines 86.9 5% 50.6 3% 72%
Hospital Products 173.9 9% 135.4 7% 28%
Exports (77.5) -4% 150.1 7%
Spar 346.4 18% 293.3 15% 18%
Fishing 219.1 11% 339.5 17% (35%)
Other (2.8) 0% (46.6) -2% 94%
1,918.2 100% 2,017.7 100% (5%)
* Operating income is stated before amortisation of intangible assets
ABRIDGED CASH FLOW STATEMENT
Year ended 30
September
2003 2002
Rm Rm
Reviewed Audited
Cash operating profit 2,289.2 2,347.3
Working capital changes (372.8) (438.4)
Net interest paid (221.4) (274.5)
Dividends received 85.5 52.0
Taxation paid (606.9) (378.7)
Cash available from operations 1,173.6 1,307.7
Dividends paid (500.4) (387.3)
Net cash inflow from operating activities 673.2 920.4
Net cash outflow from investing activities (1,186.9) (332.7)
Net cash (outflow)/inflow before financing (513.7) 587.7
activities
Net cash outflow from financing activities (69.1) (915.7)
Net decrease in cash and cash equivalents (582.8) (328.0)
including short term borrowings regarded as
cash and cash equivalents
NOTES
Year ended 30
September
2003 2002
Rm Rm
Reviewed Audited
1. Operating income
Operating income before amortisation of
intangibles is reflected after charging:
Cost of sales 17,507.1 14,993.6
Sales and distribution expenses 1,875.2 1,667.4
Marketing expenses 555.6 418.3
Other operating expenses 1,183.0 1,066.0
Depreciation (included in cost of sales 259.8 223.8
and other operating expenses)
2. Amortisation of intangibles
Goodwill 11.4 2.8
Trademarks and other intangible assets 8.8 1.1
20.2 3.9
3. Abnormal items
Net loss on discontinuation of operations - (35.1)
Profit on sale of land and buildings net 26.6 4.5
of impairment charge on properties
Net (loss)/profit on sale of interest in (10.5) 173.3
subsidiaries and joint ventures
Amount written off investments - (103.0)
Other - (21.4)
Abnormal profit before taxation 16.1 18.3
Taxation 1.4 (15.7)
17.5 2.6
Outside shareholders" interest (0.2) 0.6
Abnormal profit attributable to 17.3 3.2
shareholders in Tiger Brands Limited
4. Income from associates
Normal trading 129.2 177.1
Abnormal items (36.5) -
Discontinuation of operations (35.0) -
Other (1.5) -
92.7 177.1
5. Change in accounting policy
With effect from 1 October 2002 the group has adopted accounting statement AC
133 relating to the recognition and measurement of financial instruments. In
terms of AC 133, opening reserves at 1 October 2002 have been adjusted according
to the statement"s transitional provisions. Therefore, opening reserves at 1
October 2002 have been increased by an amount of R173.0 million as reflected in
the statement of changes in equity. In terms of AC 133,comparative figures have
not been restated as a result of this change in policy. The major impact of AC
133 in the current financial year on the balance sheet is to reduce the carrying
value of investments by R26.1 million as at 30 September 2003, being the
shortfall of the fair valuation versus the carrying value of listed and unlisted
investments. In addition, non distributable reserves reflect a reduction of
R16.8 million as at 30 September 2003, being the investment revaluation
shortfall after providing for deferred tax. The impact on the income statement
for the year ended 30 September 2003 is to reduce earnings by an after tax
amount of R22.3 million, being the estimated cost of R9.1 million of unwinding
interest rate swap contracts at 30 September 2003 and the mark to market
revaluation of R13.2 million in respect of foreign exchange contracts
outstanding at 30 September 2003 relating to items not yet on the balance sheet.
OTHER GROUP SALIENT FEATURES
Year ended 30
September
2003 2002
Rm Rm
Reviewed Audited
Net worth per ordinary share (cents) 1,993 1,863
Net debt to equity (%) 55.1 54.9
Interest cover - net (times) 8.8 7.5
Current ratio (:1) 1.4 1.4
Capital expenditure (R million) 359.5 250.6
- expansion 164.7 145.9
- replacement 194.8 104.7
Capital commitments (R million) 232.8 125.9
- contracted 102.5 44.6
- approved 130.3 81.3
Capital commitments will be funded from normal
operatingcash flows and the utilisation of
existing borrowing facilities.
Contingent liabilities (R million)
Guarantees and contingent liabilities* 734.2 605.5
* R479.5 million (2002: R435.4 million)
comprises contingencies in respect of head
leases entered into by the Spar group for which
they have entered into equivalent sub-leases.
Carrying value of investments (R million) 2,264.0 2,333.8
Listed 273.0 77.7
Unlisted 1,222.2 1,172.4
Associates 768.8 1,083.7
Fair valuation of investments (R million) 2,265.3 2,713.0
Listed - market value 273.0 336.8
Unlisted - directors" valuation 1,222.2 1,172.5
Associates - directors" valuation 770.1 1,203.7
STATEMENT OF CHANGES IN EQUITY
Share Non-
capital and distributable Accumulated
premium reserves profits Total
Rm Rm Rm Rm
Balance at 30 696.4 556.2 1,476.2 2,728.8
September 2002
Adjustment to 172.1 0.9 173.0
opening balance
in terms of AC
133
Adjusted 696.4 728.3 1,477.1 2,901.8
balance at 1
October 2002
Issue of share 25.0 25.0
capital and
premium
Fair value (16.8) (16.8)
adjustments -
Investments
Foreign (239.1) (239.1)
currency
translation
reserve
movement
Transfers 13.3 (13.3) 0.0
between
reserves
Impairment
charge for
associate C&T
Malt taken
against
previously (74.5) (74.5)
revalued
amounts
Movements in (32.5) (32.5)
reserves of
associates
Net profit for 1,257.8 1,257.8
the year
Dividends on (484.9) (484.9)
ordinary shares
Balance at 30 721.4 378.7 2,236.7 3,336.8
September 2003
Restated 664.6 393.2 652.5 1,710.3
balance at 30
September 2001
(previously
reported)
Issue of share 31.8 31.8
capital and
premium
Foreign (39.4) (39.4)
currency
translation
reserve
movement
Transfers 164.7 (164.7) 0.0
between
reserves
Movements in 43.3 43.3
reserves of
associates
Prior year 1.3 1.3
goodwill
Realised (5.6) (5.6)
surplus on
revaluation of
financial
instruments
Net profit for 1,360.1 1,360.1
the year
Dividends on (373.0) (373.0)
ordinary shares
Balance at 30 696.4 556.2 1,476.2 2,728.8
September 2002
Review of operations
Tiger Brands recorded a decline of 5% in headline earnings per share to 777.0
cents for the twelve months ended 30 September 2003. This compares to the 7%
increase achieved for the first six months of the year. The results are in line
with the outlook at the time of release of the interim results.
The year under review has been characterised by the sharp appreciation in the
value of the Rand and a declining inflation rate, which have contributed to
challenging trading conditions with increasing pressure on operating margins. As
previously reported, the negative movement in the exchange rate in 2002 had a
material effect on the results for that year, which saw headline earnings per
share increasing by 36%. A more accurate reflection of Tiger"s recent
performance is to view the results over the two year period ended 30 September
2003. This indicates that Tiger achieved an average annual compound growth rate
in headline earnings per share of 13.8% over the two years, which translates to
an increase of 5.8% per annum in real terms.
The year saw the successful integration of a number of new acquisitions, which
are discussed more fully below. In addition, further progress was made towards
settling down Tiger"s business and category structures, based on branded, demand
driven criteria.
Results
Revenue from continuing operations increased by 15% to R23.0 billion (2002:
R20.1 billion), whilst operating income declined by 5% to R1.9 billion (2002:
R2.0 billion). The operating margin reduced from 10.1% in 2002 to 8.3% in 2003.
The lower profits for the year were influenced by falling market prices for
maize products, which was compounded by the impact on margins of high priced
maize stocks carried over from 2002. Notwithstanding this, the maize business
managed to record a small profit for the year. In addition, the sustained
strengthening of the South African Rand had a material negative impact on the
profitability of the group"s export business and on the Rand translation of the
earnings of Tiger"s foreign associates. Exports (excluding Sea Harvest and
Oceana exports which are included under Fishing) reflected an overall loss for
the year.
On the positive side, strong results were achieved by a number of the Domestic
Food categories, as well as by Consumer Healthcare, Hospital Products and Spar.
Despite an increase in net borrowings for the year of R345.9 million, interest
cover further improved to 8.8 times (2002: 7.5). The net debt:equity ratio was
virtually unchanged at the end of the year at 55.1%. Before financing
activities, there was a net cash outflow of R513.7 million compared to an inflow
of R587.7 million in the previous year. This turnaround was primarily
attributable to the current year cost of acquisitions (R690.0 million), an
increase compared to last year of R228.2 million in tax payments, a R112.1
million increase in the level of capital expenditure, and a decline of R58.1
million in cash operating profit.
There was a reduction of 48% in the share of profits from associate companies.
This reduction includes the costs of closure (R35.0 million) by C&T Malt of one
of its malting facilities in the US, which amount has been added back for the
purposes of determining headline earnings. The comparison against last year was
also negatively impacted by the lower Rand conversion of the profits of the two
foreign associates, C&T Malt and Carozzi, and also by the change in status of
Enterprise Foods from an associate company to a fully consolidated subsidiary
with effect from 1 May 2003. After adjusting for these differences, the
contribution from associates showed a decrease of 7%.
Acquisitions
Several acquisitions took place during the year which will enhance and
complement the company"s portfolio of branded food and healthcare products.
The company acquired Robertsons Homecare (Pty) Limited with effect from November
2002 and the remaining 50% interest in Enterprise Foods (Pty) Limited with
effect from 1 May 2003.
Adcock Ingram"s existing range of generic medicines was enhanced by the
acquisition of the generic medicines business of Parke-Med with effect from July
2003. The Citro-Soda OTC (over- the-counter) brand was acquired from Abbott
Laboratories in February 2003, together with a number of other consumer brands.
The group has acquired the entire issued share capital of Nelspruit Wholesalers
(Pty) Limited with effect from 1 November 2003. Nelspruit Wholesalers operates a
Spar distribution centre in Nelspruit, servicing 31 Spar retail stores in the
Lowveld region. The acquisition consolidates Tiger"s position as the sole owner
of the `Spar" name in South Africa, Swaziland, Botswana and Namibia.
FMCG (Domestic Food and Consumer Healthcare)
Operating income improved by 16% on a revenue increase of 15%. Some good
performances were achieved, but the overall FMCG result was significantly
influenced by the poor performance from maize.
The Domestic Food operations, in aggregate, increased operating profit by 10% on
revenue growth of 12%. Good performances were achieved by the Meal Occasions,
Snacks & Treats and Perishables categories, whilst Culinary and Milling recorded
operating income decreases of 9% and 40% respectively.
Within Meal Occasions, the fruit and vegetables (Koo) business enjoyed
considerable market strength while the rice category (Tastic) showed strong
profit growth assisted by lower dollar prices for this fully imported product,
as well as the strength of the Rand.
Albany bakeries had an excellent year, benefiting significantly from the
performance of its Superior bread loaf which exceeded expectations. Breakfast
cereals (Jungle, Morvite, Mabella) recorded a good improvement in profit, with
the performance of the sorghum based products, Morvite and Mabella, being
assisted by the introduction of new production capability. The pasta (Fatti"s &
Moni"s) category had a disappointing year, producing a sharp fall in operating
income on turnover which was only marginally ahead of last year. 2004 will see a
major focus on new growth initiatives for this brand.
Culinary recorded a decline of 9% in operating income, primarily influenced by
losses sustained in the vegetable oil and margarine businesses. Discussions are
in process for the disposal of these two businesses. The Condiments and
Ingredients (All Gold, Colmans) and Spreads (All Gold, Black Cat) categories
produced steady results. The All Gold brand continued to perform well, enjoying
volume and value share growth across all product categories. The brand also
benefited from the introduction of several new meal enhancement products,
including a range of ON TABLE sauces.
The Snacks & Treats category (Beacon, Smoothies, Fizz Pops, Inside Story) showed
an 18% improvement in operating income on a revenue increase of 6%. Innovation
and brand development initiatives contributed to an increase in market share,
which helped to absorb the effect of the overall decline in the total market.
The strong Rand has resulted in a significant increase in imports by local
distributors of sugar confectionery products from countries where sugar is
acquired at subsidised prices, resulting in pressure being placed on the South
African sugar confectionery industry.
The Perishables category comprises value added prepared meat products
(Enterprise) and the cheese and fresh dairy operations (DairyBelle). Enterprise
Foods, which performed well, was successfully assimilated into the company"s
structures following the acquisition by Tiger of the remaining 50% shareholding.
The Dairybelle business achieved a good result for the year, assisted by the
performance of the fresh dairy category which returned to profitability after
incurring a loss in the previous year.
The Milling operations produced disappointing results with a significant decline
in operating income of 40%, on revenue which was marginally below last year.
Milling comprises the maize (Ace), flour (Golden Cloud) and sorghum milling
(King Korn) operations.
Maize Milling has seen a return to profitability following the operating loss
incurred for the first six months of the year. In comparing the results against
last year, it must be borne in mind that 2002 was an exceptional year for the
maize business which benefited significantly from successful procurement
strategies during a time of sharply escalating raw material prices. The 2003
result has been negatively impacted by the utilisation of high priced maize
stocks carried over from 2002, relative to the sharply lower raw material prices
in the period under review. Operating margins were further eroded through maize
price hedging activities which proved to be ineffective as a result of the
steadily declining maize price. The cost of these hedging activities amounted to
R73 million (pre-tax).
Wheat milling achieved a small increase in operating income, whilst sorghum
based beverages performed well, with King Korn remaining the consumer"s brand of
choice.
The Consumer Healthcare operations improved operating income by 40% on a revenue
increase of 46%. Excluding acquisitions, operating income and revenue grew by
15% and 12% respectively.
OTC Medicines recorded a 6% improvement in operating income compared to a 9%
increase in revenue. Legislative changes, affecting the ability to advertise to
the general public, have necessitated the transfer of all Schedule 2 medicines
to Regulated Healthcare. Accordingly, comparative figures for OTC Medicines and
Regulated Healthcare have been restated in the accompanying segmental analysis.
The acquisition of the Citro Soda and Vidaylin brands during the year extended
the category, giving rise to significant manufacturing economies of scale.
Competition from generic products and housebrands impacted upon the growth of
Panado. Innovation, such as the extension of the Bioplus range to energy drinks
and chews, will assist in providing future growth in the category.
Personal and Babycare improved operating income by 22% on a revenue increase of
19%. A significant investment in innovation and brand development was made
during the year. Ingram"s Camphor Cream benefited from a successful relaunch of
the brand, whilst an active innovation programme contributed to a strong
performance by Purity and Elizabeth Anne"s.
The acquisition of the Robertsons Homecare range of well established brands
(Doom, Fastkill, the Dy-range, Peaceful Sleep, Airoma) has provided the Homecare
category with the critical mass to compete successfully in the growing
insecticides and airfreshener markets. The Jeyes range of surface cleaners
continued to perform well.
Regulated Healthcare
Regulated Healthcare, which comprises Branded Prescription Medicines (including
Schedule 2 drugs) and Generic Medicines, reflected a 2% decline in operating
income on a 12% increase in revenue.
Branded Prescription Medicines showed a decline in both revenue and operating
income. Steps taken by Government and healthcare funders to reduce the costs of
medicine, and increased competitive activity, led to declining sales volumes in
several of the older brands, including Myprodol, Syndol and Lentogesic. However,
particularly good performances were recorded by a number of brands, including
Synap Forte, Corenza C and Dilinct.
The strong performance of the Generic Medicines business was assisted by a
robust new product pipeline which included the `first to market" launches of
Adco-Simvastatin and Adco-Zolpidem. The acquisition of the generic business of
Parke-Med extended the generic portfolio into chronic medication and helped
provide critical mass to the category. The flagship brand Adco-Dol enjoyed
further strong market growth.
Hospital Products
Hospital Products performed strongly, increasing both revenue and operating
income by 28%. A major innovation drive and expansion into new markets have
contributed significantly to this result. The sale of new products comprised 17%
of total revenue. Despite intense competition, the core intravenous solutions
business performed well.
Exports
The Export operations (excluding Fishing) recorded a loss of R77.5 million for
the year, compared to a pre-tax profit of R150.1 million in the previous year.
The strength of the Rand had a major adverse effect on the year"s results. This
was exacerbated by the reversal in the early part of the year of currency
translation profits taken to income in the previous year. This, together with
further currency losses incurred on the conversion of foreign monetary assets,
resulted in a total amount of R89 million being charged against income.
Deciduous fruit exports were also impacted by a slower offtake of product in
certain markets, but this is expected to be rectified in the first quarter of
2004.
Spar
In its 40th birthday year, Spar produced another good performance, improving
operating income by 18% on a revenue increase of 21%. Spar"s successful year has
been characterised by strong growth in the Superspar format, with the number of
Superspar stores increasing from 75 to 95. In total, 53 new stores (all formats)
were launched during the year and a further 110 stores were upgraded. The
performance of the Spar housebrands exceeded expectations, with innovation and
quality being the key drivers.
The recently completed extension to the North Rand distribution centre provides
the region with an essential chilled and frozen facility. The Spar group is now
able to distribute perishables from all its distribution centres.
Fishing
The group"s fishing interests, comprising 73% held Sea Harvest and 41% held
Oceana, reflected a 35% decline in operating income on an 8% reduction in
revenue. The company"s investment in Oceana is proportionately consolidated.
Sea Harvest recorded a substantial reduction in operating income on revenue
which was 11% below last year. This disappointing performance was attributable
to a number of factors including the impact of the strong Rand on export
realisations, poor catch rates and a significant increase in the landings of
lower value small fish. The total allowable catch for hake in South Africa was
reduced by 3000 tons, with Sea Harvest"s quota being adjusted accordingly.
Oceana, which is separately listed, increased headline earnings per share by
13%. Strong sales of canned fish, mostly under the Lucky Star brand, boosted the
company"s performance in the year under review.
Earnings from lobster exports fell significantly as a result of the strong Rand
and lower dollar selling prices. Horse mackerel and fish meal revenues also
suffered from lower prices.
Associates
Empresas Carozzi performed in line with expectations, with earnings in Chilean
pesos marginally ahead of the previous year but down in Rand terms. The
appreciation of the Chilean peso against most South and Central American
currencies had an adverse effect on Carozzi"s export earnings. The share of
earnings from C&T Malt declined in US dollar terms as a result of a poor barley
crop in the mid-Western United States and in Australia, following drought
conditions. The prices for barley raw material increased globally, which the
company was unable to fully recover from its key customers.
Final Dividend
The company has declared an unchanged final dividend of 211.0 cents per share
which brings the total dividend for the year to 290.0 cents per share (2002:
290.0 cents).
Outlook
Notwithstanding potential Rand volatility and the expectation of margin pressure
in a lower inflationary environment, 2004 should see earnings growth. Factors
which are expected to support this include:
* the impact on consumer spending of significantly lower interest rates
* the benefits of recent acquisitions in healthcare and food
* the ongoing acquisition of products within the Regulated Healthcare business
* continued focus on costs and manufacturing efficiencies
* further focused investment on core brands and on innovation
Annual Report
The annual report will be posted to shareholders in December.
R A WILLIAMS N DENNIS
Chairman Chief Executive Officer 19 November 2003
Directors:
Independent: R A Williams (Chairman), B H Adams, D D B
Band, B P Connellan, U P T Johnson, A C
Nissen,G N Padayachee, B L Sibiya, J L van den
Berg, L C van Vught
Executive: N Dennis (Chief Executive Officer) (British),
M H Franklin, J H McBain (British), M C
Norris,R V Smither, C F H Vaux
Company secretary I W M Isdale
Share registrars: Computershare Limited, 70 Marshall Street,
Johannesburg, 2001
Postal address: PO Box 62053, Marshalltown, 2107
Registered office: 85 Bute Lane, Sandown, Sandton
Postal address: PO Box 78056, Sandton, 2146, South Africa
The presentation to be made to the Investment Analysts Society of South Africa
on 20 November 2003 will be available on the company"s website
http://www.tigerbrands.com
Date: 19/11/2003 04:34:18 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
