TIDMZAM

RNS Number : 6562B

Zambeef Products PLC

11 June 2021

Zambeef Products plc

("Zambeef" or the "Group")

Interim results for the Half Year Ended 31 March 2021

Zambeef (AIM: ZAM), the fully integrated cold chain foods and retail business with operations in Zambia, Nigeria and Ghana, today announces its results for the half-year ended 31 March 2021.

Financial Highlights

 
 Figures in 000's                       2021          2020         %       2021       2020       % 
                                         ZMW           ZMW                 USD        USD 
                                    ------------  ------------          ---------  --------- 
 
 Revenue                              2,150,473     1,797,633     20%    102,501    129,233    -21% 
 Cost of sales                       (1,411,049)   (1,171,504)    20%    (67,257)   (84,220)   -20% 
 Gross profit                          739,424       626,129      18%     35,244     45,013    -22% 
 Administrative expenses              (584,654)     (500,630)     17%    (27,867)   (35,991)   -23% 
 Operating profit                      154,770       125,499      23%     7,377      9,022     -18% 
 Share of loss equity 
  accounted investment                  (915)        (1,898)     -52%      (44)      (136)     -68% 
 Exchange losses                      (42,558)      (62,870)     -32%    (2,029)    (4,520)    -55% 
 Finance costs                        (56,360)      (48,241)      17%    (2,686)    (3,468)    -23% 
 Profit before taxation                54,937        12,490      340%     2,618       898      192% 
 Taxation charge                      (21,846)        (927)      2257%   (1,041)      (67)     1454% 
 Group (loss)/profit 
  for the period from 
  continued operations                 33,091        11,563      186%     1,577       831       90% 
 Profit/(Loss) from discontinued 
  operations                           20,843        (9,423)     -321%     993       (677)     -247% 
 Total Profit for the 
  period                               53,934         2,140      2420%    2,570       154      1569% 
 EBITDA                                259,888       182,665      42%     12,387     13,141     -6% 
----------------------------------                                      ---------  ---------  ------ 
 Gross Profit Margin                   34.38%        34.83%               34.38%     34.83% 
 EBITDA Margin                         12.09%        10.16%               12.09%     10.16% 
 Debt/Equity (Gearing)                  27.6%         28.9%               27.57%     28.93% 
 Debt-To-EBITDA                         3.88          5.48                 3.88       5.48 
                                    ------------  ------------  ------  ---------  ---------  ------ 
 
 

PERFORMANCE OVERVIEW

The Group had a strong start to the financial year, delivering results ahead of pre-pandemic levels. Demand for products, particularly poultry products, remained strong allowing the Group to remain in line with revenue expectations. The cost containment embarked on by management also continued to yield significant savings and contributed positively to the results. Improvements in the load shedding situation, following the good regional rains, resulted in reduced generator fuel costs and improved production efficiencies.

Notwithstanding, the half year period continued to present challenges in the operating environment, resulting from the Covid-19 pandemic and the previous 2020 economic uncertainties, despite greater stability compared to the second half of the 2020 financial year. The rising inflation put pressure on consumer disposable income and reduced the share of wallet going towards food spend. Supply constraints on some of Zambeef's product lines further put pressure on cost of inputs.

KEY FINANCIAL HIGHLIGHTS

Revenue was ZMW2.2 billion (USD103 million) and we achieved a gross profit of ZMW739.4 million (USD35.2 million), measuring 20% and 18% above the prior year in kwacha terms, but both down by 21% and 22% in USD terms, respectively. The performance in USD was adversely impacted by the steady depreciation of the local currency.

The Group's strong performance was driven by growth in the poultry, retail and cropping divisions. Management continued optimising top line growth through revenue management while the continued cost control measures helped deliver strong Earnings Before Interest Taxes, Depreciation and Amortisation (EBITDA).

The profitability was mainly driven by cropping, increased volumes and margins in the stock feed division and Retail and Cold Chain Food Products which is in line with our strategic imperative of consistent revenue growth through expansion of our retail network.

Despite being slightly lower than the prior year (measured in USD), exchange losses and financing costs remained high in kwacha terms, eroding bottom-line performance. The depreciation of the kwacha led to increased financing costs and exchange losses on our dollar denominated debt, notwithstanding continued principal repayments during the period.

Zambeef's Total Profit for the period increased from ZMW2.1m to ZMW53.9m (USD0.154m to USD2.57m).

Commenting on these results, the Chairman, Mr Michael Mundashi said:

"Despite the macroeconomic headwinds and Covid-19 related uncertainties continuing into the current year, we saw a relatively more stable environment during the period under review in terms of the rate of depreciation of the kwacha. Despite these challenges, the Group generated an operating profit, including discontinued operations, of ZMW175.6 million (USD8.4 million) compared to ZMW116 million (USD8.3 million) achieved in first half of the previous financial year. This achievement, in the face of such economic and market difficulties, illustrates the Group's fundamental strengths as a diversified and resilient business.

"The Board remains committed to achieving the Group's strategic priorities while navigating the seasonal market and economic challenges. The focus will be on optimising the assets of core businesses to pay down debt and to invest for the future.

"The macro-economic climate is expected to remain challenging for Zambia in 2021, characterised by high national debt levels and continued foreign currency supply constraints which could negatively affect business activity across the economy.

"The Group remains committed to delivering value to shareholders and is positioned to navigate the turmoil while capitalising on opportunities."

 
 For further information, please visit www.zambeefplc.com or 
  contact: 
 
 Zambeef Products plc                                   Tel: +260 (0) 211 369003 
 Walter Roodt 
  Faith Mukutu 
 
   finnCap (Nominated Adviser and Broker) Tel: +44 (0) 20 7220 
   0500 
   Ed Frisby/Kate Bannatyne/Tim Harper (Corporate Finance) 
   Tim Redfern/Barney Hayward (ECM) 
 
   Autus Securities Limited Tel: +260 (0) 761 002 002 
 Mataka Nkhoma 
 
 

About Zambeef Products plc

Zambeef Products plc is the largest integrated cold chain food products and agribusiness company in Zambia and one of the largest in the region, involved in the primary production, processing, distribution and retailing of beef, chicken, pork, milk, eggs, dairy products, fish, flour and stockfeed, throughout Zambia and the surrounding region, as well as Nigeria and Ghana it has 236 retail outlets throughout Zambia and West Africa.

The Company is one of the largest suppliers of beef in Zambia. Five beef abattoirs and three feedlots are located throughout Zambia, with a capacity to slaughter 230,000 cattle a year. It is also one of the largest chicken and egg producers in Zambia, with a capacity of 8.8m broilers and 22.4 million day-old chicks a year. It is one of the largest piggeries, pig abattoirs and pork processing plants in Zambia, with a capacity to slaughter 75,000 pigs a year, while its dairy has a capacity of 120,000 litres per day.

The Group is also one of the largest cereal row cropping operations in Zambia, with approximately 7,787 hectares of row crops under irrigation, which are planted twice a year, and a further 8,694 hectares of rainfed/dry-land crops available for planting each year.

CHAIRMAN'S REPORT

Dear Shareholder,

It is my great pleasure to present to you the Chairman's Report with respect to the financial half year period ended March 31, 2021.

Despite the 2020 macroeconomic headwinds and Covid-19 related uncertainties continuing into the current year, we saw a relatively more stable environment during the period under review in terms of the rate of depreciation of the kwacha and the easing of monetary policy. However, the period saw adverse market conditions in respect of securing supply, which saw a sharp rise in food inflation.

The Group generated an operating profit, including discontinued operations, of ZMW175.6 million (USD8.4 million) compared to ZMW116 million (USD8.3 million) achieved in the previous half-year period. The operating profit excluding discontinued operations was ZMW154.8 million (USD7.4 million) compared to ZMW125.5 million (USD9.0 million) achieved in the previous half-year period . The Group's performance had shown resilience in the face of market difficulties, illustrating the strengths of the vertically integrated business model which is key to creating long-term shareholder value.

The Board remains committed to achieving the Group's strategic priorities while navigating the seasonal market and economic challenges. The focus will be on optimising the assets of core businesses, to pay down debt and to invest for the future.

The Economic Environment

The Zambian economy has been under significant pressure stemming from the national debt burden, which was exacerbated by the impact of the coronavirus pandemic. Despite indications of recovery in the global economy from the effects of the coronavirus pandemic, the Zambian economic recovery remains gradual in the face of a high debt burden, high inflation and a volatile currency.

The Zambian kwacha has depreciated by 10% since the end of the 2020 full financial year period. The pace of depreciation of the local currency has slowed down owing to monetary policy interventions and the prospective benefits of a higher copper price on the international exchange markets.

Inflationary pressures, particularly food inflation, have resulted in a significant drop in our customers' disposable income and has continued to put pressure on the share of wallet going towards food spend. Inflation for the half-year period under review closed at 22.8% compared to 14% for the previous corresponding period. The resultant bumper harvest from the good summer rainfall season is expected to drive down food inflation in the second half of the financial year.

Divisional Performance review

Retail and Cold Chain Food Products

The Group continues to prioritise revenue optimisation, asset utilisation and cost control as pillars to drive profitability in the combined retail and cold chain food products divisions. Revenue grew by 29% and operating profit growth of 61% in kwacha terms was achieved.

The division experienced supply challenges during the period which resulted in inputs price increases. As a result, volumes declined across product categories. However, demand for our products was high as we remained competitively priced.

Management positioned the Poultry division as a focus point for growth this year and continues to implement measures to improve production efficiencies and therefore profitability. Increased demand for broilers and eggs allowed for revenue improvement in the Poultry division despite a volume decline.

Stockfeed

Volumes were flat compared to prior year during the period owing to slow growth and some declines on major product lines. The shortage of day-old chicks on the market limited customers buying of broiler feed while an export ban reduced export sales and the ability to earn foreign currency. The high cost of imported materials negatively impacted costs of sales.

Cropping

Zambia had a good summer rainfall season during the half year period, and as a result, yields for the summer crop are expected to be in line with expectations. The country is expected to deliver a bumper harvest which will result in lower maize prices which will help stabilise food inflation.

Strategy review

The board undertook a review of the medium to long-term strategy to position the business to respond to the challenges and opportunities for the future. I am happy to update shareholders that the process is proceeding according to plan. Part of the strategy review process included a review of our operational business units and also governance structures. The board review which I announced at the annual general meeting included a review of the composition of the board in terms of both compliment and size and I am pleased to announce that this process has since been concluded.

Outlook

Although we expect some level of stability, the macro-economic climate is expected to remain challenging during the second half period. The kwacha is expected to continue depreciating at a steady rate with expected improvements towards the end of the calendar year. The copper price, which is a major foreign exchange earner for the country, is expected to continue holding as production increases. Monetary policy easing is expected to continue and inflation is expected to stabilise following the summer crop bumper harvest. The Covid-19 pandemic and how it will evolve has further potential to impact our operations. There are fears of a potential third wave as the country navigates through the winter season that occurs during the following reporting period.

The group remains committed to delivering value to shareholders and is positioned to navigate the turmoil while capitalising on opportunities.

Acknowledgement

On behalf of the Company and the Board of Directors, I would like to express my sincere gratitude to Margaret Mudenda, John Rabb, David Osborne and Professor Enala Mwase who resigned from the board in February and March 2021. Their dedication and contributions to the success of the business over the years will be greatly missed.

Since my last Report, we welcomed Monica Musonda, Pearson Gowero and Roman Frenkel to our Board of Directors. Their industry experience and backgrounds will be key in driving the business into the next phase of the Groups evolution as a regional food provider.

I would also want to thank my fellow board members for steering the Group through this challenging period. To our management and staff, I express my gratitude to them for another solid performance, dedicated efforts and resilience in the face of challenges. I am proud of our achievements to date, and I am excited by the potential

opportunities   upon which we will build on our progress. 

Michael Mundashi

Chairman

11 June 2021

CHIEF EXECUTIVE OFFICER'S REVIEW

Overview

The half year period continued to present challenges in the operating environment, resulting from the Covid-19 pandemic and 2020 economic uncertainties, despite greater stability compared to the second half of the 2020 financial year. Inflation continued to rise, although the exchange rate depreciated at a much slower rate. Money supply continued to improve in the economy. High inflation put pressure on disposable incomes as prices of goods and services increased resulting in depressed consumer spending. Due to the low supply of livestock from producers, after the devastating effects on their profitability by the previous drought and depreciation of the currency, the retail and cold chain food products supply was negatively affected. The resultant surge in food product prices to our customers forced them towards more affordable offerings of our products.

The load shedding situation improved towards the end of the calendar year 2020 following good regional rains as a result of the La Nina weather pattern, resulting in reduced generator fuel expenditure and improved production efficiencies.

Despite the challenges noted above, Zambeef has had a strong start to the financial year, delivering results ahead of pre-pandemic levels as revenue increased and costs were contained.

The Group delivered operating profit, including discontinued operations, of ZMW175.6 million (USD8.37 million), equating to a growth of 51.3% in kwacha terms and a flat performance of 0.3% growth in US dollar terms, compared with ZMW116.1 million (USD8.35million) in HY2020. The operating profit excluding discontinued operations was ZMW154.8 million (USD7.4 million) compared to ZMW125.5 million (USD9.0 million) achieved in the previous half-year period.

Our revenue, including discontinued operations, was ZMW2.2 billion (USD106.9 million) and we achieved a gross profit of ZMW782.1 million (USD37.2 million), respectively 23.7% and 24.3% above the prior year in kwacha terms, but both down by 18% and 17.6% in US dollar terms, respectively.

The Group's strong performance was driven by growth in the Poultry, Retail and Cropping divisions. Management continued optimising top line growth through revenue management while the continued cost control measures helped deliver strong Earnings Before Interest Taxes, Depreciation and Amortisation (EBITDA), and ensured resultant operating leverage.

Exchange losses and financing costs remained high in kwacha terms, eroding bottom-line performance. The depreciation of the kwacha led to increased financing costs and exchange losses on our dollar denominated debt, notwithstanding continued principal repayments during the period.

Our diversified and vertically integrated business with strong brands, supportive partners and an experienced management team helped deliver the encouraging results.

Strategic focus

Our strategic focus is to optimise our asset utilisation and maximise returns. We remain committed to our strategy of focussing on our core businesses, in which we strive to be the best in class. The continued deleveraging and divestiture of non-core assets will enable us to free up cash to invest into our core businesses and therefore deliver shareholder value.

Retail and Cold Chain Food Products (CCFP)

The period saw traditionally high volume sales lines come under pressure amidst a high inflationary environment and reduced customer spending. Despite high demand in our key product lines, supply constraints negatively impacted volume growth. Revenue growth was mainly driven by pricing increases on traditional product categories and aided by sales volume growth of traded goods and affordable categories. Shoprite in-store butcheries were a source of revenue growth as they proved relatively more resilient to inflationary pressures.

Sales volumes came under pressure on the back of supply constraints due to constrained livestock producer profitability levels. Significant producer price increases were necessary under the review period to livestock producers to increase output. The large price increases that were necessary to stimulate supply resulted in customers moving towards more affordable protein offerings. The Poultry division was a major contributor of revenue growth due to high demand for it as a relatively affordable protein source, in the form of chicken and eggs.

Despite the challenges, the Retail and CCFP business registered a healthy revenue growth of 29% above HY2020. Management employed a revenue optimisation strategy, responding quickly to the evolving volatile operating environment.

Retail and CCFP delivered an operating profit growth of 61% in kwacha terms. Operational efficiency improvements and overhead spend discipline ensured translation of the top line growth to the bottom-line. Reduced load shedding helped reduce generator set fuel costs, which further contributed to the increased profitability, particularly in the second quarter.

Stockfeed (Novatek)

Revenue for the division was 17% above prior year mainly due to price, as volumes remained flat on prior year. The demand for poultry feed reduced following a day-old chick supply shortage across the market. An export ban on animal feed from Zambia resulted in a further slowdown of production volumes. However, fish feed continues to register exponential growth following the sector specific lifting of the export ban and government's efforts to make Zambia a regional player in the aquaculture sector. The depreciation of the kwacha to the USD and ZAR negatively impacted foreign currency denominated costs.

Cropping

The revenue decline registered in the Cropping business is due to the timing of wheat sales and the impact of the sale of Sinazongwe farm. However, operating profit increased in kwacha terms despite the decline in dollar terms. Zambia experienced a good rainfall season and the yield on the summer crop is expected to be in line with expectations.

Outlook

Although we expect the macroeconomic situation to remain volatile, we expect more stability in the medium term than we experienced in the second half of 2020. Copper prices have rallied following the global recovery from the economic downturn caused by the coronavirus pandemic.

The Covid-19 pandemic and how it evolves will continue to be an important factor in how we perform for the remainder of the year. We believe that a healthy, sustainable and profitable growth trend can only be achieved when we work together with our partners, communities and customers. We remain committed to implementing and enforcing Covid-19 protocols in our outlets.

Despite the macro-economic headwinds and uncertainty caused by the Covid-19 pandemic, Zambeef's underlying performance is expected to remain resilient.

Rehabilitating our balance sheet remains a priority. We have focused on deleveraging and thereby demonstrating to our shareholders that we have a clear path to take care of pending debt maturities. Our current strategy will help relieve exchange losses and financing cost pressures to the bottom line, which will increase free cash flow to enable us to invest for the future.

DIVISIONAL PERFORMANCE

Table 1 (ZMW) and Table 2 (USD) below provide a summary of the consolidated performance of the key business divisions reported at an operating profit level.

Table 1: Divisional financial summary in ZMW'000

 
 ZMW                 Revenue             Gross Profit             Overheads          Operating Profit 
                   2021        2020       2021       2020        2021        2020       2021       2020 
 Division       ZMW'000     ZMW'000    ZMW'000    ZMW'000     ZMW'000     ZMW'000    ZMW'000    ZMW'000 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Total 
 Retailing    1,392,447   1,138,678    138,614    120,170   (166,941)   (166,107)   (28,327)   (45,937) 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 CCFP           950,587     745,736    235,600    196,628   (133,156)   (104,790)    102,444     91,837 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Less 
  Interco     (841,687)   (721,059) 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Combined 
 Retail 
  &           1,501,347   1,163,355    374,214    316,798   (300,097)   (270,897)     74,117     45,900 
 CCFP 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Stock 
  Feed          748,062     641,656    144,290    122,378    (76,981)    (60,753)     67,309     61,625 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Cropping       163,313     256,990    191,473    161,886   (102,673)    (85,151)     88,800     76,735 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Others         145,964     109,476     29,447     25,067    (14,174)    (11,634)     15,273     13,434 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Total        2,558,686   2,171,477    739,424    626,129   (493,925)   (428,435)    245,499    197,694 
===========  ==========  ==========  =========  =========  ==========  ==========  =========  ========= 
 Less: 
  Intra/ 
                                     ---------  ---------  ----------  ----------  ---------  --------- 
 Inter 
  Group       (408,213)   (373,844) 
                                     ---------  ---------  ----------  ----------  ---------  --------- 
 Sales 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Central 
             ----------  ----------  ---------  --------- 
 Overhead                                                    (90,729)    (72,195)   (90,729)   (72,195) 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 Group 
  Total       2,150,473   1,797,633    739,424    626,129   (584,654)   (500,630)    154,770    125,499 
-----------  ----------  ----------  ---------  ---------  ----------  ----------  ---------  --------- 
 

Table 2: Divisional financial summary in USD'000

 
 USD                   Revenue            Gross Profit            Overheads         Operating Profit 
                     2021       2020       2021       2020       2021       2020       2021       2020 
 Division         USD'000    USD'000    USD'000    USD'000    USD'000    USD'000    USD'000    USD'000 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Total 
 Retailing         66,370     81,861      6,608      8,640    (7,957)   (11,942)    (1,350)    (3,302) 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 CCFP              45,309     53,612     11,228     14,135    (6,347)    (7,533)      4,883      6,602 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Less Interco    (40,119)   (51,838) 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Combined 
 Retail 
  &                71,560     83,635     17,836     22,775   (14,304)   (19,475)      3,533      3,300 
 CCFP 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Stock Feed        35,656     46,129      6,877      8,798    (3,669)    (4,368)      3,208      4,430 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Cropping           7,784     18,475      9,127     11,638    (4,894)    (6,122)      4,233      5,516 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Others             6,957      7,870      1,404      1,802      (675)      (836)        728        966 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Total            121,957    156,109     35,244     45,013   (23,542)   (30,801)     11,702     14,212 
==============  =========  =========  =========  =========  =========  =========  =========  ========= 
 Less: Intra/ 
                                      ---------  ---------  ---------  ---------  ---------  --------- 
 Inter Group     (19,456)   (26,876) 
                                      ---------  ---------  ---------  ---------  ---------  --------- 
 Sales 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Central 
                ---------  ---------  ---------  --------- 
 Overhead                                                     (4,325)    (5,190)    (4,325)    (5,190) 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 Group Total      102,501    129,233     35,244     45,013   (27,867)   (35,991)      7,377      9,022 
--------------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  --------- 
 

Taking the performance of each of our key business areas in turn:

Retail and CCFP

The combined Retail and CCFP divisions generated an EBIT margin of 5% which increased by 99 basis points from the previous financial year generating an absolute value increase of 61% to ZMW 74.1 million (HY2020: ZMW 45.9 million) in kwacha terms and 7.1% increase to USD 3.5 million (HY2020: USD 3.3 million) in dollar terms.

The strong performance was underpinned by revenue optimisation in Poultry products mainly due to favourable price and high demand given the relative affordability of Chicken and Egg as a source of protein. Cost pressure arising from supply constraints negatively impacted on the profitability in Pork, Beef and Milk.

West Africa Retail

Our Nigerian business was impacted by the sporadic protests related to the Shoprite announcement of the intention to pull out of the Nigeria market and the EndSARS protests. In addition, the business experienced supply challenges across its major product lines. Despite all these challenges, revenue increased by 43% to ZMW 155.7 million (HY2020: ZMW 109 million) mainly due to pricing and exchange translational effects with dollar revenue declining by 5%. However, operating profit declined by 89% in dollar terms due to rising costs.

Stockfeed (Novatek)

Sales volumes were flat on prior year mainly due to declines on key volume categories. Shortage of day-old chicks slowed the growth of broiler feed while an export ban impacted export sales.

Revenue grew by 17% in kwacha terms (23% decline in USD terms), while the operating profit only grew by 9.2% to ZMW 67 million (HY2020: ZMW 62 million) or declined by 28% to USD 3.2 million (HY2020: USD 4.4 million) in dollar terms. The gross margin increased to 19.3% from 19.1% in the prior year owing to favourable pricing despite rising costs of inputs.

Overheads increased by 27% to ZMW 77 million (HY2020: ZMW 61 million) owing to high repairs and maintenance costs and labour costs.

Cropping

The Cropping business is key to Zambeef, providing raw material inputs for value added processing within the Group and serving as a currency hedge by being able to generate USD cash flow.

Revenue decreased 37% to ZMW 163 million (HY2020: ZMW 257 million) or 58% to USD 7.8 million (HY2020: USD 18.5 million) in dollar terms, mainly due to timing of wheat sales during this year's cycle and the impact of the previous years sale of Sinazongwe farm and currently the assets held for sale at Chiawa farm. Gross profit increased 18% compared to the prior half-year, with only a 21% increase in the overheads even in the context of the depreciation of the kwacha.

Zambia experienced a good rainfall season and the summer harvest is expected to be in line with expectations. However, the price of maize is expected to be lower than the prior year following the expected bumper harvest predicted for Zambia.

Other businesses

Total revenue from the Group's other business units increased by 33% to ZMW 146 million (HY2020: ZMW 109 million) mainly due to growth in both the milling and leather to shoe businesses. This translated to gross profit growth of 17% in kwacha terms due to cost pressures in Milling arising from the increase in price of wheat in kwacha terms following the depreciation of the currency.

The leather to shoe business turnaround strategy is beginning to pay off as the division saw an increase in demand for its products, particularly school shoes, following the opening of schools after Covid-19 related closures. Management focus has been to optimise production efficiencies, control overhead costs, innovation and look for new market opportunities for its products.

Walter Roodt

Chief Executive Officer

11 June 2021

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                                     Unaudited                             Audited 
                                             31 Mar 2021   31 Mar 2020                30 Sept 2020 
                                     -----  ------------  ------------  -------------------------- 
 Group                                Note      ZMW'000s      ZMW'000s                    ZMW'000s 
                                     -----  ------------  ------------  -------------------------- 
 
 Revenue                              5(i)     2,150,473     1,797,633                   3,875,104 
                                     -----  ------------  ------------  -------------------------- 
 Net profit/(loss) arising 
  from price changes in 
  fair value of biological 
  assets                               9          17,242        10,408                    (14,381) 
                                     -----  ------------  ------------  -------------------------- 
 Cost of sales                               (1,428,291)   (1,181,912)                 (2,645,101) 
                                     -----  ------------  ------------  -------------------------- 
 Gross profit                         5(i)       739,424       626,129                   1,215,622 
                                     -----  ------------  ------------  -------------------------- 
 Administrative expenses                       (587,575)     (501,168)                 (1,011,968) 
                                     -----  ------------  ------------  -------------------------- 
 Other income                                      2,921           538                       6,877 
                                     -----  ------------  ------------  -------------------------- 
 Operating profit                                154,770       125,499                     210,531 
                                     -----  ------------  ------------  -------------------------- 
 Share of loss equity accounted 
  investment                                       (915)       (1,898)                     (3,177) 
                                     -----  ------------  ------------  -------------------------- 
 Exchange losses on translating 
  foreign currency transactions 
  and balances                                  (42,558)      (62,870)                   (137,705) 
                                     -----  ------------  ------------  -------------------------- 
 Finance costs                                  (56,360)      (48,241)                    (92,322) 
                                     -----  ------------  ------------  -------------------------- 
 Profit/(loss) before taxation        5(i)        54,937        12,490                    (22,673) 
                                     -----  ------------  ------------  -------------------------- 
 Taxation charge                      6(a)      (21,846)         (927)                   (112,957) 
                                     -----  ------------  ------------  -------------------------- 
 Group profit/(loss) for 
  the period from continued 
  operations                                      33,091        11,563                   (135,630) 
                                     -----  ------------  ------------  -------------------------- 
 (Loss)/profit from discontinued 
  operations                           15         20,843       (9,423)                      33,435 
                                     -----  ------------  ------------  -------------------------- 
 Total (loss)/profit for 
  the period                                      53,934         2,140                   (102,195) 
                                     -----  ------------  ------------  -------------------------- 
 
 Group profit/(loss) attributable 
  to: 
                                     -----  ------------  ------------  -------------------------- 
 Equity holders of the 
  parent                                          54,056         1,650                   (103,419) 
                                     -----  ------------  ------------  -------------------------- 
 Non-controlling interest                          (122)           490                       1,224 
                                     -----  ------------  ------------  -------------------------- 
                                                  53,934         2,140                   (102,195) 
                                     -----  ------------  ------------  -------------------------- 
 Other comprehensive income 
                                     -----  ------------  ------------  -------------------------- 
 Exchange gains on translating 
  presentational currency                        117,226       434,406                     625,042 
                                     -----  ------------  ------------  -------------------------- 
 Remeasurement of net defined 
  benefit liability                                    -             -                       6,229 
                                     -----  ------------  ------------  -------------------------- 
 Remeasurement of leases                               -          (12)                         315 
                                     -----  ------------  ------------  -------------------------- 
 Total comprehensive income 
  for the period                                 171,160       436,534                     529,391 
                                     -----  ------------  ------------  -------------------------- 
 
 Total comprehensive income/(loss) 
  for the period attributable 
  to: 
                                     -----  ------------  ------------  -------------------------- 
 Equity holders of the 
  parent                                         173,523       433,889                     525,030 
                                     -----  ------------  ------------  -------------------------- 
 Non-controlling interest                        (2,363)         2,645                       4,361 
                                     -----  ------------  ------------  -------------------------- 
                                                 171,160       436,534                     529,391 
                                     -----  ------------  ------------  -------------------------- 
 
 Earnings per share                                Ngwee         Ngwee                       Ngwee 
                                     -----  ------------  ------------  -------------------------- 
 Basic and diluted earnings 
  per share from continued 
  operations                           7            8.29          2.76                     (45.53) 
                                     -----  ------------  ------------  -------------------------- 
 Basic and diluted earnings 
  per share from discontinued 
  operations                           7            5.20        (2.35)                       11.12 
                                     -----  ------------  ------------  -------------------------- 
 Total                                 7           13.49          0.41                     (34.41) 
                                     -----  ------------  ------------  -------------------------- 
 

The accompanying notes form part of the financial statements.

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                                   Unaudited             Audited 
                                                31 Mar     31 Mar 
                                                  2021       2020   30 Sept 2020 
                                     ------  ---------  ---------  ------------- 
 Group                                Note    USD'000s   USD'000s       USD'000s 
                                     ------  ---------  ---------  ------------- 
 Revenue                              5(ii)    102,501    129,233        239,648 
                                     ------  ---------  ---------  ------------- 
 Net proft/(loss) arising 
  from price changes in fair 
  value of biological assets            9          822        748          (889) 
                                     ------  ---------  ---------  ------------- 
 Cost of sales                                (68,079)   (84,968)      (163,581) 
                                     ------  ---------  ---------  ------------- 
 Gross profit                         5(ii)     35,244     45,013         75,178 
                                     ------  ---------  ---------  ------------- 
 Administrative expenses                      (28,006)   (36,029)       (62,583) 
                                     ------  ---------  ---------  ------------- 
 Other income                                      139         38            425 
                                     ------  ---------  ---------  ------------- 
 Operating profit                                7,377      9,022         13,020 
                                     ------  ---------  ---------  ------------- 
 Share of loss equity accounted 
  investment                                      (44)      (136)          (197) 
                                     ------  ---------  ---------  ------------- 
 Exchange losses on translating 
  foreign currency transactions 
  and balances                                 (2,029)    (4,520)        (8,516) 
                                     ------  ---------  ---------  ------------- 
 Finance costs                                 (2,686)    (3,468)        (5,709) 
                                     ------  ---------  ---------  ------------- 
 Profit/(loss) before taxation        5(ii)      2,618        898        (1,402) 
                                     ------  ---------  ---------  ------------- 
 Taxation charge                      6(f)     (1,041)       (67)        (6,986) 
                                     ------  ---------  ---------  ------------- 
 Group profit/(loss) for 
  the period from continued 
  operations                                     1,577        831        (8,388) 
                                     ------  ---------  ---------  ------------- 
 Profit/(loss) from discontinued 
  operations                           15          993      (677)          2,068 
                                     ------  ---------  ---------  ------------- 
 Total profit/(loss) for 
  the period                                     2,570        154        (6,320) 
                                     ------  ---------  ---------  ------------- 
 
 Group profit/(loss) attributable 
  to: 
                                     ------  ---------  ---------  ------------- 
 Equity holders of the parent                    2,577        119        (6,396) 
                                     ------  ---------  ---------  ------------- 
 Non-controlling interest                          (7)         35             76 
                                     ------  ---------  ---------  ------------- 
                                                 2,570        154        (6,320) 
                                     ------  ---------  ---------  ------------- 
 Other comprehensive income 
                                     ------  ---------  ---------  ------------- 
 Exchange (losses)/gains 
  on translating presentational 
  currency                                    (11,265)   (42,051)       (52,402) 
                                     ------  ---------  ---------  ------------- 
 Remeasurement of net defined 
  benefit liability                                  -          -            385 
                                     ------  ---------  ---------  ------------- 
 Remeasurement of leases                             -        (1)             20 
                                     ------  ---------  ---------  ------------- 
 Total comprehensive loss 
  for the period                               (8,695)   (41,898)       (58,317) 
                                     ------  ---------  ---------  ------------- 
 
 Total comprehensive income/(loss) 
  for the period attributable 
  to: 
                                     ------  ---------  ---------  ------------- 
 Equity holders of the parent                  (8,581)   (42,144)       (58,661) 
                                     ------  ---------  ---------  ------------- 
 Non-controlling interest                        (114)        246            344 
                                     ------  ---------  ---------  ------------- 
                                               (8,695)   (41,898)       (58,317) 
                                     ------  ---------  ---------  ------------- 
 
 
 Earnings per share                              Cents      Cents          Cents 
                                     ------  ---------  ---------  ------------- 
 Basic and diluted earnings 
  per share from continued 
  operations                            7         0.40       0.20         (2.82) 
                                     ------  ---------  ---------  ------------- 
 Basic and diluted earnings 
  per share from discontinued 
  operations                            7         0.25     (0.17)           0.69 
                                     ------  ---------  ---------  ------------- 
 Total                                  7         0.65       0.03         (2.13) 
                                     ------  ---------  ---------  ------------- 
 

The accompanying notes form part of the financial statements.

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF MOVEMENTS IN EQUITY

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                                                                                                              Total 
                                                                                          Foreign                      attributable 
                                                  Preference                             exchange                         to owners 
                        Share           Share          share            Revaluation   translation      Retained              of the   Non-controlling        Total 
                      capital         premium        capital                reserve       reserve      earnings              parent          interest       equity 
                     ZMW'000s        ZMW'000s       ZMW'000s               ZMW'000s      ZMW'000s      ZMW'000s            ZMW'000s          ZMW'000s     ZMW'000s 
 At 1 October 
  2019                  3,006       1,125,012          1,000              1,199,058       381,929       535,704           3,245,709           (4,881)    3,240,828 
 Loss for the 
  period                    -               -              -                      -             -         1,650               1,650               490        2,140 
 Transfer of 
  surplus 
  depreciation              -               -              -               (14,833)             -        14,833                   -                 -            - 
 Other 
 comprehensive 
 income: 
 Remeasurement 
  of Leases                 -               -              -                      -             -          (12)                (12)                 -         (12) 
 Exchange gains 
  on translating 
  presentational 
  currency                  -               -              -                      -       432,251             -             432,251             2,155      434,406 
 Total 
  comprehensive 
  income 
  for the period            -               -              -               (14,833)       432,251        16,471             433,889             2,645      436,534 
 At 31 March 
  2020                  3,006       1,125,012          1,000              1,184,225       814,180       552,175           3,679,598           (2,236)    3,677,362 
 Profit for the 
  period                    -               -              -                      -             -     (105,069)           (105,069)               734    (104,335) 
 Transfer of 
  surplus 
  depreciation              -               -              -               (16,512)             -        16,512                   -                 -            - 
 Other 
  comprehensive 
  income 
  Remeasurement 
  of net defined 
  benefit 
  liability                 -               -              -                      -             -         6,229               6,229                 -        6,229 
 Adjustment on 
  transition 
  to IFRS16                 -               -              -                      -             -           327                 327                 -          327 
 Exchange gains 
  on translating 
  presentational 
  currency                  -               -              -                      -       189,654             -             189,654               982      190,636 
 Total 
  comprehensive 
  income 
  for the period            -               -              -               (16,512)       189,654       (82,001              91,141             1,716       92,857 
 At 30 September 
  2020                  3,006       1,125,012          1,000              1,167,713     1,003,834       470,174           3,770,739             (520)    3,770,219 
 
 Profit for the 
  period                    -               -              -                      -             -        54,056              54,056             (122)       53,934 
 Transfer of 
  surplus 
  depreciation              -               -              -               (23,141)             -        23,141                   -                 -            - 
 Other 
 comprehensive 
 income 
 Remeasurement 
 of leases                  -               -              -                      -             -             -                   -                 -            - 
 Exchange gains 
  on translating 
  presentational 
  currency                  -               -              -                      -       119,467             -             119,467           (2,241)      117,226 
 Total 
  comprehensive 
  income 
  for the period            -               -              -               (23,141)       119,467        77,197             173,523           (2,363)      171,160 
 At 31 March 
  2021                  3,006       1,125,012          1,000              1,144,572     1,123,301       547,371           3,944,262           (2,883)    3,941,379 
 
 
 

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF MOVEMENTS IN EQUITY

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                                                                             Foreign                            Total 
                                                       Preference                           exchange                     attributable 
                           Share           Share            share     Revaluation        translation       Retained         to owners   Non-controlling             Total 
                         capital         premium          capital         reserve            reserve       earnings     of the parent          Interest            equity 
                        USD'000s        USD'000s         USD'000s        USD'000s           USD'000s       USD'000s          USD'000s          USD'000s          USD'000s 
 At 1 October 
  2019                       449         185,095              100         173,209          (197,748)         84,782           245,887             (370)           245,517 
 Transactions 
 with owners 
 Profit for the 
  period                       -               -                -               -                  -            119               119                35               154 
 Transfer of 
  surplus 
  depreciation                 -               -                -         (1,066)                  -          1,066                 -                 -                 - 
 Other 
 comprehensive 
 income: 
 Exchange losses 
  on translating 
  presentational 
  currency                     -               -                -               -           (42,262)              -          (42,262)               211          (42,051) 
 Remeasurement 
  of leases                    -               -                -               -                  -            (1)               (1)                 -               (1) 
 Total 
  comprehensive 
  income 
  for the period               -               -                -         (1,066)           (42,262)          1,184          (42,144)               246          (41,898) 
 At 31 March 
  2020                       449         185,095              100         172,143          (240,010)         85,966           203,743             (124)           203,619 
 Loss for the 
  period                       -               -                -               -                  -        (6,515)           (6,515)                41           (6,474) 
 Transfer of 
  surplus 
  depreciation                 -               -                -           (872)                  -            872                 -                 -                 - 
 Other 
  comprehensive 
  income 
  Remeasurement 
  of leases                    -               -                -               -                  -             21                21                 -                21 
 Remeasurement 
  of defined 
  benefit 
  liability                    -               -                -               -                  -            385               385                                 385 
 Exchange gains 
  on translating 
  presentational 
  currency                     -               -                -               -           (10,408)              -          (10,408)                57          (10,351) 
 Total 
  comprehensive 
  income                       -               -                -           (872)           (10,408)        (5,237)          (16,517)                98          (16,419) 
 At 3o September 
  2020                       449         185,095              100         171,271          (250,418)         80,729           187,226              (26)           187,200 
 
 Profit for the 
  period                       -               -                -               -                  -          2,577             2,577               (7)             2,570 
 Transfer of 
  surplus 
  depreciation                 -               -                -         (1,103)                  -          1,103                 -                 -                 - 
 Other 
 comprehensive 
 income 
 Remeasurement 
 of leases                     -               -                -               -                  -              -                 -                 -                 - 
 Exchange gains 
  on translating 
  presentational 
  currency                     -               -                -               -           (11,158)              -          (11,158)             (107)          (11,265) 
 Total 
  comprehensive 
  income                       -               -                -         (1,103)           (11,158)          3,680           (8,581)             (114)           (8,695) 
 At 31 March 
  2021                       449         185,095              100         170,168          (261,576)         84,409           178,645             (140)           178,505 
 
 

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF FINANCIAL POSITION -- 31 MARCH 2021

 
                                                  Unaudited                 Audited 
                                  Note   31 Mar 2021     31 Mar 2020   30 Sept 2020 
                                            ZMW'000s        ZMW'000s       ZMW'000s 
 ASSETS 
 Non - current assets 
 Goodwill                                    166,801         166,801        166,801 
 Property, plant and equipment       8     3,419,935       3,292,653      3,264,505 
 Investment in associate                      42,911          10,478         43,826 
 Deferred tax assets              6(e)         8,680          80,073          9,552 
                                           3,638,327       3,550,005      3,484,684 
 Current assets 
 Biological assets                   9       689,646         520,437        176,305 
 Inventories                                 906,914         682,619      1,103,640 
 Trade and other receivables                 149,606          87,924        132,668 
 Assets held for disposal           15       175,654         131,857        175,654 
 Amounts due from related 
  companies                                    4,949          38,281          9,337 
 Income tax recoverable           6(c)        19,800          18,329          1,784 
 Cash and cash equivalents          10        83,678          62,113        111,136 
                                           2,030,247       1,541,560      1,710,524 
 Total assets                              5,668,574       5,091,565      5,195,208 
 
 EQUITY AND LIABILITIES 
 Capital and reserves 
 Share capital                                 3,006           3,006          3,006 
 Preference share capital                      1,000           1,000          1,000 
 Share premium                             1,125,012       1,125,012      1,125,012 
 Reserves                                  2,815,244       2,550,580      2,641,721 
                                           3,944,262       3,679,598      3,770,739 
 Non-controlling interest                    (2,883)         (2,236)          (520) 
                                           3,941,379       3,677,362      3,770,219 
 Non - current liabilities 
 Interest bearing liabilities       11       124,233         234,846        190,218 
 Leases                             12        10,242          19,741         19,750 
 Deferred liability                           10,578          15,737         11,389 
 Deferred taxation                6(e)        85,041          32,154         69,950 
                                             230,094         302,478        291,307 
 Current liabilities 
 Interest bearing liabilities       11       359,159         391,108        326,899 
 Leases                             12        16,446          24,701         23,259 
 Trade and other payables                    400,006         231,592        321,648 
 Provisions                                  120,857          54,310        113,347 
 Amounts due to related 
  companies                                        -           1,265            443 
 Taxation payable                 6(c)        23,940          15,253             41 
 Bank overdrafts                    10       576,693         393,496        348,045 
                                           1,497,101       1,111,725      1,133,682 
 Total equity and liabilities              5,668,574       5,091,565      5,195,208 
 

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF FINANCIAL POSITION -- 31 MARCH 2021

 
                                                    Unaudited             Audited 
                                                                            30 Sept 
                                            31 Mar 2021   31 Mar 2020          2020 
                                     Note     USD '000s     USD '000s     USD '000s 
 ASSETS 
 Non - current assets 
 Goodwill                                         7,554         9,236         8,282 
 Property, plant and equipment          8       154,888       182,317       162,091 
 Investment in associate                          1,943           580         2,176 
 Deferred tax asset                  6(j)           394         4,434           474 
                                                164,779       196,567       173,023 
 Current assets 
 Biological assets                      9        31,234        28,817         8,754 
 Inventories                                     41,074        37,797        54,798 
 Trade and other receivables                      6,776         4,868         6,587 
 Assets held for disposal              15         7,955         7,301         8,722 
 Amounts due from related 
  companies                                         224         2,120           464 
 Income tax recoverable              6(h)           897         1,015            89 
 Cash and cash equivalents             10         3,790         3,439         5,518 
                                                 91,950        85,357        84,932 
 Total assets                                   256,729       281,924       257,955 
 
   EQUITY AND LIABILITIES 
 Capital and reserves 
 Share capital                                      449           449           449 
 Preference share capital                           100           100           100 
 Share premium                                  185,095       185,095       185,095 
 Reserves                                       (6,999)        18,099         1,582 
                                                178,645       203,743       187,226 
 Non-controlling interest                         (140)         (124)          (26) 
                                                178,505       203,619       187,200 
 Non - current liabilities 
 Interest bearing liabilities          11         5,626        13,004         9,445 
 Leases                                12           464         1,093           981 
 Deferred liability                                 479           872           565 
 Deferred tax liability              6(j)         3,852         1,780         3,473 
                                                 10,421        16,749        14,464 
 Current liabilities 
 Interest bearing liabilities          11        16,266        21,656        16,231 
 Leases                                12           745         1,368         1,155 
 Trade and other payables                        18,116        12,823        15,971 
 Provisions                                       5,474         3,007         5,629 
 Amounts due to related companies                     -            69            22 
 Taxation payable                    6(h)         1,084           845             2 
 Bank overdrafts                       10        26,118        21,788        17,281 
                                                 67,803        61,556        56,291 
 Total equity and liabilities                   256,729       281,924       257,955 
 

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                  Unaudited              Audited 
                             6 months       6 months 
                                   to             to        Year to 
                          31 Mar 2021    31 Mar 2020   30 Sept 2020 
                             ZMW'000s       ZMW'000s       ZMW'000s 
 Cash inflow/(outflow) 
 from/(on) 
 operating activities 
 Profit/(loss) before 
  taxation                     54,937         12,490       (22,673) 
 Finance costs                 56,360         48,241         92,322 
 (Profit)/loss on 
  disposal of 
  property, 
  plant and equipment         (1,345)              -          4,796 
 Adjustment on 
 transition to IFRS 
 16                                 -        (1,187)              - 
 Depreciation on 
  right-of-use assets               -            304          8,362 
 Depreciation                  84,275         66,285        141,408 
 Share of loss of 
  equity accounted 
  investment                      915          1,898          3,177 
 Profit/(loss) on 
  discontinued 
  operations                   20,843        (9,423)          1,529 
 Fair value price 
  adjustment                 (17,242)       (10,408)         14,381 
 Net unrealised 
  foreign exchange 
  (gains)/losses              (5,345)         31,935        186,272 
 Earnings before 
  interest, tax, 
  depreciation 
  and amortisation, 
  fair value 
  adjustments 
  and net unrealised 
  foreign exchange 
  losses                      193,398        140,135        429,574 
 (Increase)/decrease 
  in biological 
  assets                    (496,099)      (339,612)       (20,269) 
 Decrease in inventory        196,726        258,540      (162,481) 
 Decrease in trade and 
  other receivables          (16,938)         10,101       (34,643) 
 Decrease in amounts 
  due from related 
  companies                     4,388          3,273        (2,410) 
 Decrease in trade and 
  other payables 
  and provisions               85,868       (26,597)        122,496 
 Increase in amount 
  due to related 
  companies                     (443)          1,014            192 
 (Decrease)/increase 
  in deferred 
  liability                     (811)          (625)          1,256 
 Income tax paid                    -        (3,145)        (5,525) 
 Net cash 
  inflow/(outflow 
  from/(on) 
  operating activities       (33,911)         43,084        328,190 
 Investing activities 
 Purchase of property, 
  plant and 
  equipment                  (59,829)       (57,952)       (92,664) 
 Proceeds from sale of 
  assets                        2,247            342          6,452 
 Right of use assets                -              -       (15,425) 
 Proceeds from sale of 
  assets/investments                -              -        167,264 
 Net cash (outflow)/ 
  inflow (on)/ 
  from investing 
  activities                 (57,582)       (57,610)         65,627 
 Net cash 
  (outflow)/inflow 
  before 
  financing                  (91,493)       (14,526)        393,817 
 Financing 
 Long term loans 
  repaid                     (81,925)       (56,612)      (162,217) 
 Repayment of short 
  term funding              (228,246)              -      (623,231) 
 Receipt of short term 
  funding                     232,646         15,602        487,320 
 Leases obtained                    -          3,658         14,329 
 Leases repaid               (16,321)              -       (35,478) 
 Finance costs 
  including 
  discontinued 
  operations                 (56,360)       (48,241)       (92,322) 
 Net cash outflow from 
  financing                 (150,206)       (85,593)      (411,599) 
 Decrease in cash and 
  cash equivalents          (241,699)      (100,119)       (17,782) 
 Cash and cash 
  equivalents at 
  beginning 
  of period                 (236,909)      (274,425)      (274,425) 
 Effects of exchange 
 rate changes 
 on the balance of 
 cash held in foreign 
  currencies                 (14,407)         43,161         55,298 
 Cash and cash 
  equivalents at end 
  of period                 (493,015)      (331,383)      (236,909) 
 Represented by: 
 Cash in hand and at 
  bank                         83,678         62,113        111,136 
 Bank overdrafts            (576,693)      (393,496)      (348,045) 
                            (493,015)      (331,383)      (236,909) 
 
 

ZAMBEEF PRODUCTS PLC AND ITS SUBSIDIARIES

CONSOLIDATED STATEMENT OF CASH FLOWS

FOR THE SIX MONTH PERIODED 31 MARCH 2021

 
                                                           Unaudited            Audited 
                                                      6 months       6 months 
                                                            to             to    Year to 
                                                        31 Mar         31 Mar    30 Sept 
                                                          2021           2020       2020 
                                                      USD'000s       USD'000s   USD'000s 
 Cash inflow/(outflow) from/(on) operating 
  activities 
 Profit/(loss) before taxation                           2,618            898    (1,402) 
 Finance costs                                           2,686          3,468      5,709 
 Profit/(loss) on disposal of property, 
  plant and equipment                                     (64)              -        297 
 Adjustment on transition to IFRS 16                         -           (90)          - 
 Depreciation charge on right-of-use 
  assets                                                     -             22        517 
 Depreciation                                            4,017          4,765      8,745 
 Share of loss of equity accounted 
  investment                                                44            136        196 
 Profit/(loss) on discontinued operations                  993          (677)         95 
 Fair value price adjustment                             (822)          (748)        889 
 Net unrealised foreign exchange losses/(gains)          (255)          2,296     11,495 
 Earnings before interest, tax, depreciation 
  and amortisation, fair value adjustments 
  and net unrealised foreign exchange 
  losses                                              9,217            10,070     26,541 
 Increase/(decrease) in biological 
  assets                                              (23,646)       (24,415)    (1,253) 
 Decrease in inventory                                   9,377         18,587   (10,048) 
 Decrease in trade and other receivables                 (807)            726    (2,142) 
 Decrease in amounts due from related 
  companies                                                209            235      (149) 
 Increase/(decrease) in trade and other 
  payables                                               4,093        (1,912)      7,575 
 (Decrease)/increase in amount due 
  to related companies                                    (21)             73         12 
 (Decrease) in deferred liability                         (39)           (45)        102 
 Income tax paid                                             -          (226)      (342) 
 Net cash inflow/(outflow) from/(on) 
  operating activities                                 (1,617)          3,093     20,296 
 Investing activities 
 Purchase of property, plant and equipment             (2,852)        (4,166)    (5,731) 
 Proceeds from sale of assets                              107             25        399 
 Right of use asset                                          -              -      (954) 
 Proceeds from sale of assets/investments                    -              -     10,344 
 Net cash outflow on investing activities              (2,745)        (4,141)      4,058 
 Net cash outflow before financing                     (4,362)        (1,048)     24,354 
 Financing 
 Long term loans repaid                                (3,820)        (4,070)   (10,032) 
 Repayment of short term funding                      (10,773)              -   (38,542) 
 Receipt of short term funding                          10,952          1,123     30,137 
 Leases obtained                                             -            263        886 
 Leas repaid                                             (778)              -    (2,194) 
 Finance costs including discontinued 
  operations                                           (2,686)        (3,468)    (5,709) 
 Net cash outflow from financing                       (7,105)        (6,152)   (25,454) 
 Decrease in cash and cash equivalents                (11,467)        (7,200)    (1,100) 
 Cash and cash equivalents at beginning 
  of period                                           (11,763)       (20,790)   (20,790) 
 Effects of exchange rate changes on 
  the balance of 
  cash held in foreign currencies                          902          9,641     10,127 
 Cash and cash equivalents at end 
  of period                                           (22,328)       (18,349)     11,763 
 Represented by: 
 Cash in hand and at bank                                3,790          3,439      5,518 
 Bank overdrafts                                      (26,118)       (21,788)   (17,281) 
                                                      (22,328)       (18,349)   (11,763) 
 

A copy of the Interim Report will shortly be available to view on the Company's website at www.zambeefplc.com/aim-rule-26/

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June 11, 2021 06:30 ET (10:30 GMT)

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