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Conafex Holdings Societe Anonyme - Unaudited Results For The Half Year Ended 29
February 2005
UNAUDITED RESULTS FOR THE HALF YEAR ENDED 29 FEBRUARY 2005
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
Dear Shareholder
Results for the half-year ended 28th February 2005
Profile
Conafex is an African agri-resource group listed on the Luxembourg and
Johannesburg stock exchanges and takes strategic and private equity stakes in
businesses focused on horticulture, niche and value added agriculture.
Overview
- On 12th January 2005, it was announced that Conafex had accepted an
unsolicited but conditional offer to acquire its 50% interest in The Coffee, Tea
& Chocolate Company (`CTC`). The CTC stake was acquired on 19th November 2003.
All conditions were satisfied in February 2005 and the purchase price together
with interest was settled on 1st April 2005. In simple terms and including our
share of profits since acquisition, we have realised a gain before tax of
US$543,000 (R3,992,392) on a cost of US$1,114,000 (R7,165,763).
- Intertrading continues to trade in a tough economic environment caused mainly
by the strong Rand and its financial results reflect this situation.
Intertrading is export-driven with most of its turnover earned in First World
currencies. Conafex acquired a 17.5% interest in this South African listed
company on 4th November 2003. In April 2005, Katopw International Societe
Anonyme, Conafex`s concert partner, made an offer to minority shareholders and
jointly with Conafex has secured control of Intertrading.
- Cape Natural Tea Products, an herbal tea processor based in Cape Town
experienced a poor year as it reorients itself to focus more on the local market
until the Rand weakens which will allow a reasonable margin on the export
market.
- Accord Tea Services, which provides unique and premium quality packaging
solutions in the United Kingdom, continues to perform well in their niche
market.
- The acquisition of a 26.86% in Grassroots Group (Pty) Limited with effect from
1st October 2004 was announced on 12th October 2004. The Grassroots Group,
based in Cape Town, is uniquely positioned as a leader in the field of aromatic
and medicinal plants indigenous to South Africa. It is structured into five
divisions specialising in essential oils, plant propogation, medical plants,
honeybush tea, and harvesting, drying and packaging of natural products. Most
of the group`s products are exported. Grassroots exceeded the earnings on which
the purchase was based and a final tranche of US$39,000 (approximately R241,500)
was settled bringing the total purchase consideration to US$500,000
(approximately R3 million). The Group share of earnings from Grassroots for the
five months to February were US$61,000.
- All operations in Zimbabwe have ceased. The value of Conafex`s interests was
written down in the previous financial period and the Group`s substantial
`trapped` funds in Zimbabwe are mainly invested in assets which provide a hedge
against inflation and currency erosion. There has been no progress in the
settlement of compensation by the Zimbabwe Government for the two compulsorily
acquired estates and moveable agricultural assets thereon. The Embassy of
Belgium, who acts for Luxembourg interests in Zimbabwe, continues to play an
active and supportive role in the best interests of the Group.
Financial
Profit before tax amounted to US$277,000 (2004 - loss US$54,000) including an
exceptional item of US$193,000, arising mainly from the profit on the sale of
CTC. The profit attributable to shareholders amounted to US$168,000 (2004 -
loss US$68,000).
In accordance with past practise earnings from Zimbabwe are no longer
consolidated and therefore the financial results only recognise United Sates
dollar receipts from that country.
Prospects
Prospects remain positive as a high proportion of Conafex`s activities are now
located outside of Zimbabwe. Conafex is continuing to seek investment
opportunities within its strategy of export-oriented horticulture, niche and
value added agriculture in the African region.
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 Half Year ended
LOSS ACCOUNT years ended
28th February 29th 31st August
February
2005 2004 2004
Unaudited Unaudited Audited
US$000 US$000 US$000
Notes
Group Revenue, 4,213 1,671 4,247
including share of
associate
Less revenue of (930) (91) (271)
associate
Revenue 3,283 1,580 3,976
Operating costs (3,394) (1,723) (4,152)
Operating loss (111) (143) (176)
Share of associated 51 11 (26)
company`s results
Dividend income from 7 - 131
Zimbabwean subsidiary
Other dividends - - 14
receivable
Interest receivable 5 5 58
Exchange gains 202 111 103
Interest paid and (70) (49) (155)
similar charges
Profit/(Loss) on 2 84 (65) (51)
ordinary activities
before exceptional
items and tax
Exceptional items 3 193 11 (6,379)
Profit/(Loss) before 277 (54) (6,430)
tax
Taxation on ordinary (103) (7) (44)
activities
Profit/(Loss) after tax 174 (61) (6,474)
Minority Interests (6) (7) (9)
Profit/(Loss) 168 (68) (6,483)
attributable to
shareholders
Dividend per share (US - - -
cents)
Profit/(Loss) per share 4 3 c (1)c (120)c
(US cents)
Headline profit/(loss) 4 1 c (1)c (2)c
per share (US cents)
Reconciliation of
headline earnings per
share
Basic earnings/(loss) 3 c (1)c (120)c
per share (US cents)
Less exceptional items, net (2)c - (118)c
of tax and minority interests
(US cents)
Headline earnings/(loss) per 1 c (1)c (2)c
share (US cents)
STATEMENT OF CHANGES IN EQUITY
US$000 US$000 US$000
Fair value adjustment 158 - (195)
Goodwill arising - 50 -
Dividend paid in respect of - - (163)
prior year
Exchange differences on
translation of the financial 56 (16) 41
statements of foreign entities
Net gain/(loss) not recognised 214 34 (317)
in the income statement
Net profit/(loss) for the 168 (68) (6,483)
period
Total recognised gains/(losses) 382 (34) (6,800)
and change in shareholders`
funds
Shareholders` funds at start of 4,948 11,748 11,748
period
Shareholders` funds at end of 5,330 11,714 4,948
period
CONSOLIDATED GROUP 28th 29th 31st
BALANCE SHEET February February August
2005 2004 2003
Unaudited Unaudite Audited
d
Notes US$000 US$000 US$000
Fixed assets
Tangible fixed assets 59 138 124
Negative goodwill - (54) -
Intangible assets - 295 296
Investments 5 3,759 9,821 3,056
3,818 10,200 3,476
Current assets
Inventories 237 635 571
Accounts receivable 2,115 884 1,460
Cash 227 1,567 1,099
2,579 3,086 3,130
Current liabilities
Accounts payable (980) (1,454) (1,540)
(falling due within
one year)
Net current assets 1,599 1,632 1,590
Total assets less 5,417 11,832 5,066
current liabilities
Capital and reserves
Share capital 8,130 8,130 8,130
Special reserve - 2,573 -
Other reserves 91 36 91
Retained earnings (2,891) 975 (3,273)
Assets attributable to 5,330 11,714 4,948
shareholders
Minority interests 87 118 118
5,417 11,832 5,066
CONSOLIDATED CASH FLOW Half years ended Year
STATEMENT ended
28th 29th 31st
February February August
2005 2004 2004
Unaudited Unaudite Audited
d
US$000 US$000 US$000
Operating activities
Cash utilised in (2,074) (619) (792)
operations
Interest paid (70) (49) (155)
Taxation paid (58) (17) (38)
Net cash outflow from (2,202) (685) (985)
operating activities
Investment activities
Purchase of tangible (69) (38) (56)
assets
Purchase of investments (477) (793) (796)
Acquisition of part of (76) (73) (73)
minority interest
Disposal of investments 1,820 - -
Interest received and 5 118 72
other income
Dividends received from 7 - 131
Zimbabwean subsidiary
Net cash inflow /(outflow) 1,210 (786) (722)
from investment activities
Net cash outflow before (992) (1,471) (1,707)
financing
Financing
Dividends paid to - (3)
minorities
Dividends paid to - (163)
shareholders
Net decrease in funds (992) (1,471) (1,873)
Net funds at start of 631 2,510 2,510
period
Effect of foreign exchange 36 (7) (6)
rate changes
Net funds at end of period (325) 1,032 631
NOTES
The results and the cash flow statement for the half year ended 28th February
2005 and the balance sheet at that date, which are unaudited, have been prepared
on the basis of accounting policies adopted for the period to 31st August 2004,
and comply with International Financial Reporting Standards in all respects, and
with Luxembourg legal requirements.
The analysis of results is as follows :-
Half years ended
28th February 29th February
2005 2004
US$000 US$000
Revenue Resul Revenu Resul
t e t
South Africa 2,682 104 1,053 54
United Kingdom 553 28 477 21
Luxembourg and other 48 (243) 50 (218)
3,283 (111) 1,580 (143)
Share of associated 930 51 91 11
companies
4,213 (60) 1,671 (132)
Dividend from Zimbabwean 7 -
subsidiary
Interest received 5 5
Interest paid (70) (49)
Exchange gains 202 111
Exceptional items 193 11
Profit/(Loss) before tax 277 (54)
3. The exceptional item in the current period is the profit arising from the
disposal of the joint venture, less goodwill arising on acquisitions and costs
in relation to potential acquisitions. The exceptional item in the prior year
was the provision for diminution in value of the investment in the Zimbabwean
subsidiary, net of goodwill arising on an acquisition.
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 capital expenditure of US$69,000 during the period (2004 -
US$38,000). There were no capital expenditure commitments as at 28th February
2005 (29th February 2004 - nil).
Date: 26/05/2005 05:57:10 PM
Produced by the JSE SENS Department
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