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SOVEREIGN FOOD INVESTMENTS LIMITED - Unaudited interim results of Sovereign and
its subsidiaries ("the Group") for the six months ended 31 August 2003
SOVEREIGN FOOD INVESTMENTS LIMITED
Incorporated in the Republic of South Africa
Registration number 1995/003990/06
Share code: SOV
ISIN number: ZAE000009221
Unaudited interim results of Sovereign and its subsidiaries ("the Group") for
the six months ended 31 August 2003
INCOME STATEMENT
Unaudited Unaudited Audited
six six year ended
months months
ended ended
31 August 31 August 28 February
2003 2002 2003
R"000 R"000 R"000
Revenue 158 724 129 581 286 216
Operating income 7 326 7 966 21 113
Depreciation 2 733 2 721 5 235
Net interest paid 4 415 2 236 5 606
Net operating income 178 3 009 10 272
Taxation - 540 (347)
Income after taxation 178 2 469 10 619
Dividends paid - 4 316 4 316
Retained earnings for the
period 178 (1 847) 6 303
Weighted average number of
shares in issue (000"s) 29 104 28 775 28 986
Earnings per share (cents) 0,6 8,6 36,6
Headline earnings per share
(cents) 0,6 8,6 34,3
Dividends per share (cents) - - -
Reconciliation between
earnings and headline
earnings
Profit after taxation 178 2 469 10 619
Reconciling items:
Disposal of fixed assets - - (819)
Taxation effect - - 133
Headline profit after
taxation 178 2 469 9 933
BALANCE SHEET
ASSETS
Non-current assets
Property, plant and equipment 111 111 87 751 101 349
Investments 5 344 3 424 4 426
Current assets 92 739 89 713 101 335
Cash and cash equivalents 9 070 30 087 22 554
Inventory 45 031 39 225 51 849
Trade and other receivables 38 638 20 401 26 932
Total assets 209 194 180 888 207 110
EQUITY AND LIABILITIES
Capital and reserves
Share capital 291 288 291
Share premium 45 153 44 927 45 153
Distributable reserves 45 641 37 313 45 463
Shareholders" interest 91 085 82 528 90 907
Interest bearing debt 75 017 55 036 65 208
Long term portion 62 038 45 347 54 384
Short term portion 12 979 9 689 10 824
Deferred taxation 9 836 10 722 9 836
Trade and other payables 33 256 32 602 41 159
Total equity and liabilities 209 194 180 888 207 110
CASH FLOW STATEMENT
Cash generated from operations
before working capital changes 7 326 7 966 20 294
Changes in working capital (11 579) (4 528) (13 504)
Cash generated from operating
activities (4 253) 3 438 6 790
Interest paid (4 415) (2 236) (5 606)
STC paid - (540) (539)
Dividends paid - (4 316) (4 316)
Net cash flow from operating
activities (8 668) (3 654) (3 761)
Net cash flows from investing
activities (3 830) 981 (1 410)
Net cash flows from financing
activities (68) (7 656) (11 779)
Net change in cash, cash
equivalents and investments (12 566) (10 329) (16 860)
STATEMENT OF CHANGES IN EQUITY
February Net profit August
2003 for the period 2003
R"000 R"000 R"000
Share capital 291 - 291
Share premium 45 153 - 45 153
Retained earnings 45 463 178 45 641
Total 90 907 178 91 085
COMMENTS
PERIOD UNDER REVIEW
The period under review was a promising period for the Group. Despite a decline
in earnings per share to 0,6 cents per share from 8,6 cents per share for the
comparative period last year which was predominantly caused by higher finance
costs, the Group made marked improvements in operating efficiencies that will
bear fruit in the second half of the year.
Turnover increased 22% over the prior period of which 9% can be attributed to
increased efficiencies and the balance to a combination of higher bird volumes
into plant and slightly lower prices. Non-broiler subsidiaries" contribution to
income and turnover remained consistent with the previous period.
The Group is nearing the end of its current investment cycle, which has, in the
past 12 months, necessitated investment in fixed assets and working capital of
approximately R24 million and R20 million respectively. The investment in fixed
assets resulted in higher finance costs. The increase in net working capital
accounted for most of the decrease in cash and cash equivalents.
PROSPECTS
In accordance with past experience, it is the norm for the Group to make the
majority of its operating profits in the second half of the financial year.
Based on current trading results, the board of directors expects earnings for
the full year to follow a similar trend as that of the prior financial year.
DIVIDEND
In accordance with the Group"s dividend policy of only declaring one dividend
per annum, no interim dividend has been declared.
ACCOUNTING POLICIES
The interim financial statements have been prepared in accordance with South
African Statements of Generally Accepted Accounting Practice, which accounting
policies are consistent with those used in the previous period.
By order of the Board
R B Spanjaard M J B Davis
Executive Chairman Managing Director
20 November 2003
Sovereign Food Investments Limited
Registration number 1995/003990/06
E-mail: info@sovfoods.co.za PO Box 61051
Website: www.sovfoods.co.za
Transfer secretaries
Computershare Services Limited
Marshalltown 2107
Gauteng
Directorate
R B Spanjaard (Executive Chairman), M J B Davis (Managing Director), B Cape*, C
Coombes, B A Spanjaard*, A H Vardy* (*Non-executive)
Date: 20/11/2003 05:03:04 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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