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CONAFEX - UNAUDITED RESULTS FOR THE HALF YEAR ENDED 29 FEBRUARY 2004
CONAFEX HOLDINGS SOCIETE ANONYME
(Incorporated in Luxembourg - RC Luxembourg No. B 17789)
("Conafex")
JSE CODE: CNX ISIN: LU0167907293
Registered Office
6 rue Adolphe Fischer,
L-1520, Luxembourg
Profile
Conafex is a pan-African agri-resource group listed on the Luxembourg and
Johannesburg stock exchanges and focused on horticulture, niche and value added
agriculture.
Overview
Conafex made two significant and strategic acquisitions during the period under
review.
- On 4th November 2003, Conafex announced it had acquired 17.5% of the issued
share capital of Intertrading Limited for US$754,000, effective from 31st
October 2003. Intertrading is an agri-service and marketing company listed on
the JSE Securities Exchange South Africa that procures Southern African fresh
fruit, vegetables and macadamia nuts and markets the produce internationally.
It also provides freight forwarding and logistic services for the export of
perishable cargo to foreign destinations. In concert with an international
associate, who simultaneously acquired 17.5% of Intertrading, there will be
substantial synergies to be realised by Intertrading through the joint
shareholding relationship. Conafex has a call option over a further 15.6% of
the issued share capital exercisable at any time, but no later than 30th
November 2004, at a strike price of 60 cents per share (South African).
- We also announced on 19th November 2003 the purchase of a 50% stake in the
Coffee, Tea and Chocolate Company (Pty) Limited (CTC), based in Cape Town for
US$871,000. CTC is a well-established and dynamic business that adds value to
primary agricultural produce, mainly black and herbal teas and coffee, through
packaging and branding into leading retail chains in South Africa. CTC benefits
from the strong rand as a high proportion of its raw materials are imported from
the rest of Africa.
- Cape Natural Tea Products, a herbal tea processor based in Cape Town
experienced a slow six months and suffered from the unusually strong rand. A
high proportion of its turnover is generated from exports to Europe and Japan.
The cost of raw materials remains high in the face of unprecedented demand for
South African herbal teas which continues to outstrip supply.
-Accord Services, which provides unique and premium quality tea packaging
solutions in the United Kingdom experienced normal trading conditions.
- Operations in Zimbabwe enjoyed an average rainfall season but agricultural
commodity prices translated at the unrealistic official exchange rate in a hyper
inflationary environment are significantly eroding the group"s ability to
sustain normal levels of production.
Financial
The full impact of the recent acquisitions mentioned above has not been fully
incorporated in the six-month period under review. CTC has been treated on a
joint venture basis in respect of four trading months results only and
Intertrading has been treated solely as an investment for the time being.
The Conafex Group balance sheet has strengthened following the disposal of
Barato Holdings announced in March 2003 with US$1.57m cash on deposit, of which
US$1.3m is held in Euros and, with the weakening of the US dollar, has generated
exchange gains of US$0.1m. A loss however of US$68,000 was incurred after tax
and exceptional items for the six-month period ending 29th February 2004.
In accordance with the practice first adopted in the 2002 financial year,
earnings from Zimbabwe are no longer consolidated and therefore the financial
results include only United States dollar receipts from Zimbabwe.
Prospects
The Conafex Group has been in a transitional process since its formation in 1998
when it was solely dependant on its assets in Zimbabwe. The Group now has a
more balanced portfolio of investments with a strong and exciting growth
prospects from its recent acquisitions in South Africa. CTC, in particular, is
performing ahead of expectations.
Conafex will continue to seek investment opportunities with a preference to
South Africa but within its strategy of focused export orientated horticulture,
niche and value-added agriculture.
Dividend
As is customary, your Directors do not propose to pay a dividend at the interim
stage.
M W BURRELL
Chairman
Directors: M.W. Burrell (Chairman), C. Barrow, D.C. Marshall, W.H. Marshall, The
Hon C.A. Pearson
Chief Executive Officer: C.P. Jousse
Group Offices
Zimbabwe (Regional Headquarters)
215 Fife Avenue/10th Street,
(P.O. Box 2733),
Harare
South Africa
11 Sunbury Park,
La Lucia Ridge Office Estate
La Lucia 4051, Durban
United Kingdom
25 City Road
London, EC1Y 1BQ
CONSOLIDATED PROFIT AND LOSS ACCOUNT
Period
ended
29th February 31st March
2004 2003 2003
Unaudited Unaudited Audited
US$000 US$000 US$000
Note
s
Group Revenue, including
share of associate 1,671 412 1,238
Less revenue of (91) (214) (500)
associate
Revenue 1,580 198 738
Operating costs (1,723) (385) (1,094)
Operating loss (143) (187) (356)
Share of associated 11 (22) 11
company"s results
Interest receivable 5 1 1
Exchange gains 111 6 22
Interest paid and
similar charges (49) (7) (24)
Loss on ordinary
activities before
exceptional items and
tax 2 (65) (209) (346)
Exceptional items 3 11 1,073 1,040
(Loss)/Profit before tax (54) 864 694
Taxation on ordinary (7) (11) (10)
activities
(Loss)/ Profit after tax (61) 853 684
Minority Interests (7) - (4)
(Loss)/ Profit
attributable to
shareholders (68) 853 680
Dividend per share (US
cents) - - -
(Loss)/ Profit per share
(US cents) 4 (1)c 16 c 13 c
Headline (loss)/earnings
per share (US cents) 4 (1)c (4)c (7)c
Basic (loss)/earnings
per share (US cents) (1)c 16 c 13 c
Less exceptional items, net
of tax and minority interests
(US cents) - (20)c (20)c
Headline (loss)/earnings per
share (US cents) (4)c
STATEMENT OF CHANGES IN EQUITY
Half years ended Period
ended
29th 31st March 31st
February August
2004 2003 2003
Unaudited Unaudited Audited
US$000 US$000 US$000
Goodwill arising 50 - -
Exchange differences on
translation of the (16) 40 49
financial statements of
foreign entities
Net gain not recognised in 34 40 49
the income statement
Net (loss)/profit for the (68) 853 680
period
Total recognised (34) 893 729
(losses)/profits and change
in shareholders" funds
Shareholders" funds at 11,748 11,019 11,019
start of period
Shareholders" funds at end 11,714 11,912 11,748
of period
CONSOLIDATED GROUP BALANCE SHEET
29th 31st 31st
February March August
2004 2003 2003
Unaudited Unaudited Audited
Notes US$000 US$000 US$000
Fixed assets
Tangible fixed
assets 138 54 109
Negative
goodwill (54) - (58)
Intangible
assets 295 - 269
Investments 5 9,821 11,781 9,000
10,200 11,835 9,320
Current assets
Inventories 635 135 502
Debtors 884 117 1,071
Cash 1,567 402 2,642
3,086 654 4,215
Current
liabilities
Creditors
(falling due
within one
year) (1,454) (344) (1,552)
Net current
assets 1,632 310 2,663
Total assets
less current
liabilities 11,832 12,145 11,983
Non-current
liabilities
Creditors
(falling due
after more
than one year) - (100) (100)
Provisions for
liabilities
and charges
Deferred
taxation - (2) -
11,832 12,043 11,883
Capital and
reserves
Share capital 8,130 8,130 8,130
Special
reserve 2,573 2,573 -
Other reserves 36 36 2,609
Retained
earnings 975 1,173 1,009
Assets
attributable
to
shareholders 11,714 11,912 11,748
Minority
interests 118 131 135
11,832 12,043 11,883
CONSOLIDATED CASH FLOW STATEMENT
29th 31st March
February
2004 2003 2003
Unaudited Unaudited Audited
US$000 US$000 US$000
Operating activities
Cash utilised in operations (619) (214) (29)
Interest paid (49) (7) (2)
Taxation paid (17) (7) (5)
Net cash outflow from
operating activities (685) (228) (36)
Investment activities
Purchase of tangible assets (38) - (23)
Net proceeds on disposal of - 32 39
tangible assets
Purchase of investments (793) (30) (180)
Investment in joint venture - - (871)
Acquisition of part of
minority interest (73) (16) (16)
Disposal of investments - - 2,952
Interest received and other 116 1 1
income
Dividends received from
associates 2 - -
Net cash (outflow)/inflow
from investment activities (786) (13) 1,902
Net (decrease)/increase in
funds (1,471) (241) 1,866
Net funds at start of
period 2,510 643 643
Effect of foreign exchange
rate changes (7) - 1
Net funds at end of period 1,032 402 2,510
NOTES
The results and the cash flow statement for the half year ended 29th February
2004 and the balance sheet as at that date, which are unaudited, have been
prepared on the basis of accounting policies adopted for the period to 31st
August 2003, and comply with International Accounting Standards in all respects,
and with Luxembourg legal requirements. The Company"s year end was changed in
2003 to 31st August, following shareholder approval at the AGM held in that
year. The comparative results shown in this statement are therefore for the six
months to 31st March 2003.
2 The geographic analysis of results is as follows :-
Revenue Result Revenue Result
South Africa 1,053 54 - -
United Kingdom * 477 21 157 (1)
Luxembourg and other 50 (218) 41 (186)
1,580 198
Share of associated
company * 91 11 214 (22)
1,671 (132) 412 (209)
Interest received 5 1
Interest paid (49) (1)
Exchange gains 111 -
Exceptional items 11 1,073
(Loss)/Profit before
tax (54) 864
* Accord Services Limited was included as an associated company up to the
acquisition of a controlling interest in January 2003.
3. The exceptional item is the net write off of goodwill on the acquisition of
a further interest in Accord Services Limited and the Joint Venture. In the
previous period and year the exceptional items were the adjustment to reverse a
proportion of the fair value provisions against that part of the investment in
Ariston which was sold in May 2003.
4. Earnings per share are based on the net profit attributable to members and
the 5,420,152 shares in issue. Headline earnings per share are based on the
result attributable to shareholders excluding exceptional items, net of minority
interests and tax, where applicable.
5. The investments are stated at fair value.
6. There was no capital expenditure during the period (2003 - same). There
were no material capital expenditure commitments as at 31st March 2004 (2003 -
same).
Date: 07/05/2004 10:32:42 AM Produced by the JSE SENS Department
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