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CNX
CNX
Conafex - Unaudited Interims for Period Ended 28 February 2006
Conafex Holdings Societe Anonyme
(Incorporated in Luxembourg
(RC Luxembourg No. B 17789)
("Conafex")
JSE CODE: CNX ISIN: LU0243998001
Results for the half-year ended 28th February 2006
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.
Group Reconstruction
Shareholders approved the capital reconstruction and other matters at the Annual
General Meeting held on 24th February 2006. In summary approval was granted
for:
- a provision against the carrying value of the remaining Zimbabwe investments
and as a consequence a reduction in Conafex"s share capital;
- the issue of shares for cash to persons other than shareholders;
- the distribution in specie of the Zimbabwe investments held in an unlisted
holding company, ZRC Limited, to Conafex shareholders on a one for one basis;
- the granting of options over 3.5 million Conafex shares to ZRC Limited;
- the issue of warrants to Conafex shareholders on a one for three basis; and
- the issue of shares to a trust for the benefit of employees.
Trading Update
Due to the seasonality of the main businesses in which Conafex has invested, a
high proportion of the income accrues in the second half of the year. Trading
has been difficult for the export oriented businesses with the exception of the
Grassroots Group, which has full export order book for its oven dried fruit and
phyto-medicinals. During the period Conafex increased its stake in Grassroots
to 30.96%.
Financial
An operating loss before tax was incurred of US$215,000 (2005 - operating profit
US$84,000) and a loss attributable to shareholders of US$289,000 (2005 - profit
US$168,000) for the six month period ending 28th February 2006.
Prospects
In the past Conafex"s ability to grow was impeded by its exposure to Zimbabwe.
Following the aforementioned reconstruction, all Conafex"s investments and
assets are now located outside of Zimbabwe. This, together with an imminent
private placement of shares for cash, will assist the group in fulfilling its
strategy of growth by acquisition of agri-related businesses and improve the
liquidity of its shares.
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
CONSOLIDATED PROFIT AND LOSS Half years ended Year ended
ACCOUNT
28th February 28th 31st August
February
2006 2005 2005
Unaudited Unaudited Audited
US$000 US$000 US$000
Notes
Group Revenue, including 2,529 4,213 4,514
share of associates
Less revenue of associates (929) (930) (2,002)
Revenue 1,600 3,283 2,512
Operating costs (1,846) (3,394) (2,751)
Operating loss (246) (111) (239)
Share of associated 55 51 164
companies results
Dividend income from 6 7 7
Zimbabwean subsidiary
Other dividends receivable - - 13
Interest receivable 28 5 90
Exchange (losses)/gains (27) 202 38
Interest paid and similar (31) (70) (99)
charges
(Loss)/Profit on ordinary
activities before (215) 84 (26)
exceptional items and tax
Exceptional items 3 (15) 193 (1,778)
(Loss)/Profit before tax 2 (230) 277 (1,804)
Taxation on ordinary (72) (103) (168)
activities
(Loss)/Profit after tax (302) 174 (1,972)
Minority Interests 13 (6) (7)
(Loss)/Profit attributable (289) 168 (1,979)
to shareholders
Dividend per share (US - - -
cents)
(Loss)/Profit per share (US 4 (21)c 12 c (148)c
cents)
Headline (loss)/profit per 4 (18)c 4 c (8)c
share (US cents)
Reconciliation of headline
earnings per share
Basic (loss)/ earnings per (21)c 12 c (148)c
share (US cents)
Less exceptional items, net of tax 3 c (8)c 140c
and minority interests (US cents)
Headline (loss)/ earnings per (18)c 4 c (8)c
share (US cents)
STATEMENT OF CHANGES IN EQUITY
US$000 US$000 US$000
Fair value adjustment of investments (129) 158 237
Dividend in specie/Unclaimed dividends
in respect of prior years now forfeit (14) - 10
Exchange differences on translation of
the financial statements of 6 56 45
foreign entities
Net (loss)/gain not recognised in the (137) 214 292
income statement
Net (loss)/ profit for the period (289) 168 (1,979)
Total recognised (losses)/gains and (426) 382 (1,687)
change in shareholders" funds
Shareholders" funds at start of period 3,261 4,948 4,948
Shareholders" funds at end of period 2,835 5,330 3,261
CONSOLIDATED GROUP BALANCE 28th 28th 31st
SHEET February February August
2006 2005 2005
Unaudited Unaudited Audited
Notes US$000 US$000 US$000
Non current assets
Property, plant and equipment 167 59 41
Goodwill 182 - -
Intangibles 17 - -
Investments 5 1,627 3,759 1,992
1,993 3,818 2,033
Current assets
Inventories 706 237 146
Accounts receivable 768 2,115 446
Cash 1,130 227 1,419
2,604 2,579 2,011
Current liabilities
Accounts payable (falling due (1,392) (980) (702)
within one year)
Net current assets 1,212 1,599 1,309
Accounts payable in more than (56) - -
one year
Deferred taxation 9 - -
Total assets less current 3,158 5,417 3,342
liabilities
Capital and reserves
Called up share capital 2,172 8,130 8,130
Other reserves 91 91 452
Retained earnings 572 (2,891) (5,321)
Shareholders" funds 2,835 5,330 3,261
Minority interests 323 87 81
3,158 5,417 3,342
CONSOLIDATED CASH FLOW STATEMENT Half years ended Year ended
28th 28th 31st August
February February
2006 2005 2005
Unaudited Unaudited Audited
US$000 US$000 US$000
Operating activities
Cash generated/(used) by 37 (254) (321)
operations
Interest paid (30) (70) (99)
Taxation paid (97) (58) (181)
Net cash outflow from operating (90) (382) (601)
activities
Investment activities
Purchase of tangible assets (16) (69) (2)
Purchase of investments - (477) (589)
Acquisition of (395) (76) (76)
subsidiaries/further parts of
minority interests
Proceeds on disposal of investment - - 1,820
in joint venture
Interest received and other income 28 5 103
Dividends received from Zimbabwean 6 7 7
subsidiary
Net cash inflow /(outflow) from (377) (610) 1,263
investment activities
Net cash outflow before financing (467) (992) 662
Financing
Increase in long term debt 7 - -
Dividends paid to minorities - - (2)
Dividends paid to shareholders - - -
Net decrease in funds (460) (992) 660
Net funds at start of period 1,283 631 631
Effect of foreign exchange rate (30) 36 (8)
changes
Net funds at end of period 793 (325) 1,283
NOTES
The results and the cash flow statement for the half year ended 28th February
2006 and the balance sheet at that date, which are unaudited, have been prepared
on the basis of accounting policies adopted for the year ended 31st August 2005,
and comply with International Financial Reporting Standards in all respects, and
with Luxembourg legal requirements.
2. The analysis of results is as follows:-
Half years ended
28th February 28th February
2006 2005
US$000 US$000
Reven Result Revenue Result
ue
South Africa 1,013 (43) 2,682 104
United Kingdom 525 19 553 28
Luxembourg and other 62 (222) 48 (243)
1,600 (246) 3,283 (111)
Share of associated companies 929 55 930 51
2,529 (191) 4,213 (60)
Dividend from Zimbabwean 6 7
subsidiary
Interest received 28 5
Interest paid (31) (70)
Exchange gains (27) 202
Exceptional items (15) 193
Profit/(Loss) before tax (230) 277
3. The exceptional item in the current period is the costs arising in
connection with the capital restructuring, goodwill on acquisitions, less
profits on disposals of non current assets by a subsidiary. The
exceptional item in the prior year was the profit arising from the disposal
of the joint venture, less goodwill arising on acquisitions, project costs
and the provision for diminution in the remaining value of the investment
in the Zimbabwean subsidiary.
4. (Loss)/ Earnings per share are based on the net results attributable to
members and 1,448,038 shares in issue. The comparative figures have been
adjusted to reflect the cancellation of three out of every four shares
following the capital restructuring approved at the Annual General Meeting
on 24th February 2006. 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$16,000 during the period (2005 -
US$69,000). There were no material capital expenditure commitments as at
28th February 2006 (2005 - nil).
19 May 2006
Date: 19/05/2006 09:00:09 AM Produced by the JSE SENS Department
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