REG - Zambeef Products PLC - Full Year Results
07/12/2023 09:00
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RNS Number : 0236W Zambeef Products PLC 07 December 2023
07 December 2023
Zambeef Products plc
("Zambeef" or the "Group")
Full-year results for the year ended 30 September 2023
Zambeef (AIM: ZAM), the fully integrated cold chain foods and retail business
with operations in Zambia, Nigeria and Ghana, today announces its audited
results for the year ended 30 September 2023.
Financial Highlights
Figures in 000's 2023 2022 % 2023 2022 %
ZMW ZMW USD USD
Revenue 6,046,157 5,394,761 12% 331,478 314,014 6%
Change in fair value of biological assets 643,198 349,462 84% 35,263 18,567 90%
Cost of sales (4,846,092) (4,111,037) 18% (265,685) (237,518) 12%
Gross profit 1,843,263 1,633,186 13% 101,056 95,063 6%
Administrative expenses (1,336,488) (1,236,762) 8% (73,272) (71,989) 2%
Distribution Expenses (96,287) (65,596) 47% (5,279) (3,818) 38%
Net impairment losses on financial assets (2,713) (17,869) -85% (149) (1,040) -86%
Impairment of goodwill - (141,786) - - (8,253) -
Other (expenses)/ income (46,419) 2,491 -1963% (2,545) 145 -1855%
Operating profit 361,357 173,664 108% 19,811 10,108 96%
Share of loss equity accounted investment (2,595) (3,503) -26% (142) (204) -30%
Finance costs (155,088) (118,538) 31% (8,503) (6,900) 23%
Finance income - 3,541 -100% - 206 -100%
Profit before taxation 203,673 55,164 269% 11,166 3,210 248%
Taxation charge (72,851) (63,283) 15% (3,994) (3,684) 8%
Group income for the year from continuing operations 130,822 (8,119) 1711% 7,172 (474) 1613%
(Loss)/Profit from asset held for sale after tax (10,604) 39,697 -127% (581) 2,311 -125%
Group income for the period 120,218 31,578 281% 6,591 1,837 259%
EBITDA 554,662 514,791 8% 30,409 29,965 1%
Gross Profit Margin 30.5% 30.3% 30.5% 30.3%
EBITDA Margin 9.2% 9.5% 9.2% 9.5%
Debt/Equity (Gearing) 30.2% 20.2% 30.2% 20.2%
Debt-To-EBITDA 2.54 1.45 76% 2.21 1.57 40%
PERFORMANCE OVERVIEW
The Zambian economy grappled with significant challenges, creating a difficult
operational and economic environment. Longer than planned sovereign debt
restructuring, subdued mining production of copper, and the impact of climate
change; affecting crop yields and rainfall patterns, were primary drivers of
this adversity. High energy prices and currency depreciation further impacted
and worsened the operating conditions.
The local currency experienced notable volatility against the US Dollar, with
fluctuations of up to 35%. This fluctuation was primarily driven by heightened
demand for the USD, uncertainties surrounding debt restructuring, and a
sustained increase in global interest rates, which affected offshore investor
participation in local bond auctions. The ZMW/USD exchange rate commenced at
K15.9 and concluded at K21.31, representing a 35% surge. Inflation, a critical
economic indicator, concluded the financial year at 12%, as opposed to the
previous year's 9.9%. This was attributed to the depreciation of the currency,
along with escalating food and energy prices, despite the persistent
implementation of a stringent monetary policy by the central bank.
However, despite a tough operating environment, demand for the Group's
products grew, bolstered by a customer focused approach to pricing. The
Group's management team, through a concerted effort, prioritized both revenue
maximisation, volume growth and cost management, thereby, positioning the
Group on the path to actualise its strategic goals.
The Group's performance underscores its resilience within an ever-evolving
market and highlights the robustness of the vertically integrated business
model, the cornerstone in creating enduring value for its shareholders.
KEY FINANCIAL HIGHLIGHTS
The Group achieved a revenue of ZMW 6.0 billion (USD 331.5 million), along
with a gross profit of ZMW 1.8 billion (USD 101.0 million). This represents a
year-on-year increase of 12.1% and 12.9% in kwacha terms, and 5.6% and 6.3% in
US dollar terms, respectively. The Group's performance was achieved on the
back of strong volumes performance in Stock feed and Cold Chain Food Products.
Finance costs increased by 31% which can be attributed to the extended
utilisation of the overdraft and term loan facilities to supplement business
growth and financing escalating working capital requirements.
Additionally, the Group delivered an operating profit of ZMW 361.4 million
(USD 19.8 million), a significant increase of 108.1% in kwacha terms (96.0% in
US dollar terms) compared to the prior year's ZMW 173.7 million (USD 10.1
million). Although prior year was impacted by a one off impairment cost of ZMW
141.8 million, this growth underscores the effectiveness of the Group's
commercial strategy and the successful execution of the key cropping project.
The Group ultimately recorded a profit of ZMW120.2 million (USD 6.6 million)
for 2023 compared to ZMW31.6 million (USD 1.8 million) of value generated in
the previous corresponding period.
The bottom line profitability was mainly driven by increased volumes and
margins in the Stock feed and Cold Chain Food products segments.
Management continued to optimize top-line growth through effective revenue
management while upholding stringent cost control measures, positioning the
Group on the trajectory to actualize its short to medium-term strategy.
The Group remains dedicated to fortifying its brand equity and providing
customers with high quality products. With its diversified and vertically
integrated business model, robust brands, and effective management, the Group
is well-equipped to seize future opportunities and navigate potential threats.
Commenting on these results, Chairman Michael Mundashi said:
"Despite a tough operating environment, demand for our products grew,
bolstered by a customer focused approach to pricing. Our management team,
through a concerted effort, prioritized both revenue maximisation, volume
growth and cost management, thereby, positioning the Group on the path to
actualise its strategic goals."
"The Group's performance underscores our resilience within an ever-evolving
market and highlights the robustness of our vertically integrated business
model, the cornerstone in creating enduring value for our esteemed
shareholders."
"The enduring stability of the economy hinges on the successful resolution of
the government's debt restructuring negotiations. We foresee a positive
trajectory for copper prices, a vital contributor to our foreign exchange
earnings, fuelled by a rising global demand, notably from China and the
burgeoning electric vehicle market. The recently unveiled 2024 budget has
instilled optimism, as it signals an increase in government expenditure,
anticipated to infuse much-needed liquidity into the economy. This, in turn,
is expected to bolster consumer spending and subsequently drive economic
growth."
"Zambeef is strategically positioned to seize the forthcoming opportunities
and demonstrates adaptability in the face of an otherwise challenging
operating environment. This resilience and strategic foresight underscore our
commitment to navigating through complexities and thriving in the
ever-evolving economic landscape."
Copies of Zambeef's Annual Report and Accounts for the year ended 30 September
2023 and Notice of AGM will shortly be sent to shareholders and made available
on the Group's website and a further announcement will be made at this time.
For further information, please visit www.zambeefplc.com or contact:
Zambeef Products plc Tel: +260 (0) 211 369003
Faith Mukutu, Chief Executive Officer
M'boo Mumba, Chief Financial Officer
Cavendish Capital Markets Ltd (Nominated Adviser and Broker) Tel: +44 (0) 20 7220 0500
Ed Frisby/Abigail Kelly (Corporate Finance)
Tim Redfern (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, dairy products, fish, flour and stockfeed, throughout
Zambia and the surrounding region, as well as Nigeria and Ghana.
It has 269 retail outlets throughout Zambia and West Africa.
The Company is one of the largest suppliers of beef in Zambia. Five beef
abattoirs and five feedlots are located throughout Zambia, with a capacity to
slaughter 230,000 cattle a year. It is also one of the largest chicken
producers in Zambia, with a capacity of 9.4m broilers and 25 million-day-old
chicks a year. It is one of the largest pig abattoirs and pork processing
plants in Zambia, with a capacity to slaughter 102,000 pigs a year, while it's
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 7,265 hectares of row crops under irrigation, which are
planted twice a year, and a further 7,924 hectares of rainfed/dry-land crops
available for planting each year.
CHAIRMAN'S REVIEW
Dear Shareholder,
Over the past financial year, we navigated an extremely challenging
operational landscape. The primary drivers midst the ongoing economic
headwinds in Zambia were other factors such as the longer-than-planned foreign
debt restructuring, subdued copper mining activities, and the impact of
climate change affecting crop yields and rainfall patterns.
At the back of these adversities, the 2023 Government GDP growth projection of
4.2% was revised downwards to 2.7%. Consequently, the country saw a tightened
monetary policy coupled with food and energy inflation which led to a reduced
liquidity situation and limited consumer expenditure. The depreciation of the
Kwacha against major foreign currencies led to escalated costs in critical
inputs such as fuel and agricultural inputs, further putting pressure on
margins.
Despite the tough operating environment, our management team remained focused
on our strategy and through a concerted effort, prioritising revenue
maximisation, volume growth and cost management, which positioned the group
for the commendable results achieved.
The Group's performance underscores our resilience within an ever-evolving
market and highlights the robustness of our vertically integrated business
model, the cornerstone in creating enduring value for our esteemed
shareholders.
Strategy
The Board maintains its unwavering commitment to realizing the Group's
strategic objectives, even in the face of seasonal market dynamics and
economic fluctuations. The five-year strategy focuses on:
§ Strengthening our core business through targeted investments and expanding
market share.
§ Crafting a tailored human capital strategy to meet the organizational
needs.
§ Enhancing strategic partnerships to bolster our competitive edge and market
position.
§ Divestiture of non-core assets to allocate resources effectively.
The three to five-year US$100 million expansion program, announced last year,
is poised to bolster various value chain capacities within the Group. This
initiative is anticipated to have a transformative impact on the Zambian
economy, fostering job creation, augmenting tax revenues, and providing
essential support to ancillary enterprises, including small-scale farmers and
medium-sized businesses. The expansion of the Mpongwe Farm row cropping
capacity is advancing, with the inaugural 7,168 metric tonnes of wheat crop
harvested in the financial year under review. This milestone is expected to
bring about a substantial enhancement in production efficiency and capacity
throughout the downstream food value chains. Concurrently, upgrades to the
milling and processing facilities are also making significant progress.
During the year, we had the honour of hosting His Excellency Hakainde
Hichilema, the President of the Republic of Zambia, who inspected some of our
strategic projects in Mpongwe. These include the Cropping expansion, Hatchery
expansion, and the new wheat mill. This event also marked the official launch
of the 2023 Wheat harvest season.
The Economic Environment
Throughout the fiscal year, the local currency experienced notable volatility
against the US Dollar, with fluctuations of up to 35%. This fluctuation was
primarily driven by heightened demand for the USD, uncertainties surrounding
debt restructuring, and a sustained increase in global interest rates, which
affected offshore investor participation in local bond auctions. The ZMW/USD
exchange rate commenced at K15.9 and concluded at K21.31, representing a 35%
surge. Inflation, a critical economic indicator, concluded the financial year
at 12%, as opposed to the previous year's 9.9%. This was attributed to the
depreciation of the currency, along with escalating food and energy prices,
despite the persistent implementation of a stringent monetary policy by the
central bank.
Noteworthy was the resurgence in copper prices, which peaked at USD 8,230/MT,
fuelled by China's copper consumption. However, subdued production levels
continued to impede the realization of full value, consequently impacting the
economy's foreign exchange earnings potential. These dynamics underscore the
delicate balance between global market forces and domestic production
capacities.
Outlook
The enduring stability of the economy hinges on the successful resolution of
the government's debt restructuring negotiations. We foresee a positive
trajectory for copper prices, a vital contributor to our foreign exchange
earnings, fuelled by rising global demand, notably from China and the
burgeoning electric vehicle market. The recently unveiled 2024 National budget
has instilled optimism, as it signals an increase in government expenditure,
anticipated to infuse much-needed liquidity into the economy. We are
optimistic, that this will bolster consumer spending and subsequently drive
economic growth.
Zambeef is strategically positioned to seize the opportunities ahead and
demonstrates adaptability in the face of an otherwise challenging operating
environment. This resilience and strategic foresight underscore our commitment
to navigating through complexities and thriving in the ever-evolving economic
landscape.
16 September 2024 will be the eighth anniversary of British International
Investment plc's (BII) investment in the Company. After this date BII's
conversion rights on their convertible redeemable preference shareholding
("Preference Shares") will increase materially, from currently one-for-one new
ordinary share, to one for 3.0833 (recurring) new ordinary shares. BII is the
Company's largest ordinary shareholder and also holds all Preference Shares.
The Company has the right to redeem all or part of the Preference Shares at
the redemption price, which would give BII a 12% compounded annual return on
their investment, subject to a minimum of USD 0.77 per Preference Share (less
dividends received). However, the likelihood of such a repayment by the
Company in this new financial year, or in the medium term, is currently
considered by the Board to be extremely unlikely.
Acknowledgement
Since my last report, we welcomed two additional Non-Executive Directors of
the Board; Mr. Muyangwa Muyangwa and Dr. John Clifford Rich. Their respective
appointments and subsequent announcements were on 21 April and 21 June 2023
respectively. We are confident that their extensive experience will be
instrumental in driving our business forward, in line with our strategic
objectives.
I am indebted to my fellow Board members for their devoted leadership
throughout the year and I convey my sincere appreciation to our diligent
management and staff for yet another year of commendable performance. The
steadfast tenacity and fortitude shown in the face of challenges is a
testament to the team. I take great pride in our collective achievements thus
far and I am eager for the promising opportunities that will shape our future
progress. Together, we will continue to build upon this foundation of success.
Michael Mundashi
Chairman
Chief Executive Officer's Report
Overview
During the financial year ending on September 30, 2023, Zambeef exhibited
agility resulting in strong financial performance. Management continued to
optimise top-line growth through effective revenue management while upholding
stringent cost control measures, positioning the Group on the trajectory to
actualize its short to medium-term strategy.
Our achievements stand as a testament to the talent within our organization
and the enduring partnerships we've established with customers, suppliers, and
the communities in which we operate. Reflecting on the past year, it is
evident that our unwavering dedication to commercial objectives, along with
our commitment to operational excellence and cost optimization, has not only
spurred us forward but also solidified our position in some of the sectors in
which we operate. This report offers a comprehensive overview of our
performance, spotlighting significant milestones, financial performance, and
ongoing initiatives aimed at sustaining growth and creating long-term value.
Financial Performance
Despite a challenging trading environment marked by constrained consumer
spending and a tight monetary policy, the Group achieved strong results for
the year ending September 30, 2023. Escalating costs of vital inputs and
commodities, including fuel, electricity, agricultural supplies, and grain,
led to increased production costs for our livestock and cropping divisions.
Nevertheless, the Group demonstrated volume growth in most divisions,
capitalizing on the momentum from the latter half of 2022. This was
facilitated by a meticulous approach to revenue management and effective sales
and operational execution.
The Group achieved a revenue of ZMW 6.0 billion (USD 331.5 million), along
with a gross profit of ZMW 1.8 billion (USD 101.1 million). This represents a
year-on-year increase of 12.1% and 12.9% in kwacha terms, and 5.6% and 6.3% in
US dollar terms, respectively.
Additionally, the Group delivered an operating profit of ZMW 361.4 million
(USD 19.8 million), a significant increase of 108.1% in kwacha terms (96.0% in
US dollar terms) compared to the prior year's ZMW 173.7 million (USD 10.1
million). Although the prior year was impacted by a one-off impairment cost of
ZMW 141.8 million, this growth underscores the effectiveness of our commercial
strategy and the successful execution of the cropping expansion project.
The Group remains dedicated to fortifying its brand equity and providing
customers with high-quality products. With our diversified and vertically
integrated business model, robust brands, and effective management, we are
well-equipped to seize future opportunities and navigate potential threats.
Strategic Focus
Our strategic focus remains to optimise our existing 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
investment in key strategic assets and divestiture of non-core assets will
enable us to increase cash generation and profitability and therefore continue
to deliver shareholder value. I am pleased to report that our $100 million
medium-term expansion plans are proceeding as scheduled. We have maintained
our dedication to enhancing capacity and efficiency in Cropping, Milling,
Stockfeed, Dairy, and Poultry.
Our strategic focus in optimising costs and rationalising the Group's
operations continued throughout the financial year. Management's proposal to
restructure the Group was approved and an announcement was made in September
2023. The Company is expected to benefit from the restructuring as it will
eliminate unnecessary complexities and duplications of its business processes
across the six different entities, which have the same key decision-makers,
processes, ownership and senior Executive team. I am particularly gratified
that all the Executive positions have been filled, positioning the Group for
navigating forthcoming business growth with a leadership team with the
necessary ability to drive the Group's future success.
Outlook
Looking ahead, our strong brand presence will continue to be a cornerstone in
maintaining customer loyalty. Additionally, our vertically integrated business
model places us in a favourable position, ensuring a reliable supply chain and
a market for our products. We anticipate a stabilisation in the economic
environment once the process of debt restructuring concludes and there is an
upswing in Copper production. With these factors in mind, the Group is poised
to leverage the opportunities arising from a positive economic outlook,
strategically investing for the future in anticipation of an upturn in
consumer spending.
Our ongoing commitment to consolidating our balance sheet through the disposal
of low returning assets, optimising existing assets and the expansion of
capacity remains a central focus. These measures are geared towards enhancing
shareholder value, a goal we remain dedicated to achieving. By fortifying our
financial foundation and strengthening our operational capabilities, we are
poised for sustained growth and prosperity in the years ahead.
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
Table 2: Divisional financial summary in USD'000
Retailing & Cold Chain Food Products
The year was marked with good sales volumes across all protein categories,
despite operating within a competitive and financially constrained
environment. Our ability to retain and increase volumes was driven by
meticulous sales execution and price optimization, all of which had a direct
impact on the overall revenue growth.
However, it's worth noting that despite achieving double-digit volume growth,
the beef division reported a decline in gross profit, primarily attributed to
expenses resulting from the outbreak of Contagious Bovine Pleuropneumonia
(CBPP), a disease affecting cattle, whose effect continued from the previous
financial year into the current one. In addition, rising input costs,
specifically the high price of buying animals and increased feeding costs, put
pressure on profitability.
In the first half of the year, there was a sluggish demand for chicken, which
picked up in the latter half. This was largely due to other protein categories
becoming relatively more expensive. This shift in consumer preference helped
bolster sales of both feed and Day-old chicks, contributing to the division's
overall performance and demonstrating the dynamic consumer behaviour and the
importance of adapting to market trends.
The Dairy segment's revenue realisation was on the back of strong volume
growth and is well positioned to capitalise on further growth opportunities in
the coming periods.
Despite the challenges, the division experienced a moderate growth of 1.4%
growth in gross profit in USD terms and 7.7% in Kwacha terms over the prior
year. This growth can be attributed to effective pricing strategies,
operational efficiency improvements, and a favourable product mix.
The Retailing and Cold Chain Food Production segment is well poised to build
upon these achievements and continue its trajectory of growth and
profitability in the upcoming fiscal year. Through strategic initiatives and a
customer-centric approach, we aim to further strengthen our position in the
market.
Cropping and Milling
The Cropping segment delivered a notable revenue performance, achieving a
growth of 17.7% in Kwacha (10.9% in USD) compared to the previous year.
However, operating profit ended with a significant reduction, primarily
attributed to lower prices and yields in the summer soya bean crop which was
further compounded by the escalating costs of critical inputs such as
fertilizer and fuel.
In the Stock Feed segment, there was an increase in demand during the latter
half of the year which translated into revenue and volume maximization,
ultimately contributing to profitability. The positive performance underscores
our capability to adapt to changing market dynamics and meet customer needs
effectively.
The Flour segment experienced double-digit growth in volumes attributed to the
implementation of good sales strategies and the introduction of new product
lines. This performance highlights our commitment to innovation and our
ability to execute sales initiatives effectively, thereby driving growth in
this segment.
Acknowledgements
I would like to extend my gratitude to our Board of Directors for their
guidance and support. I am also indebted, to all our dedicated staff and
partners, for their invaluable contributions to the ongoing success of the
Group.
I eagerly anticipate what we will achieve in the coming year as we continue to
implement and execute our growth strategy.
Faith Mukutu
Chief Executive Officer
6 December 2023
Zambeef Products Plc and its Subsidiaries
Statement of profit or loss and other comprehensive income
Notes Group Company
Continuing operations 2023 2022 2023 2022
K'000 K'000 K'000 K'000
Revenue from contracts with customers 5(ii) 6,046,157 5,394,761 3,384,408 3,361,428
Change in fair value of biological assets 16 643,197 349,462 568,975 338,052
Cost of sales of goods 7 (4,846,092) (4,111,037) (3,046,883) (2,826,242)
Gross profit 1,843,262 1,633,186 906,500 873,238
Other (expenses)/income 6 (46,419) 2,491 (18,064) 17,325
Net impairment losses on financial assets 4(b) (2,713) (17,869) (1,768) (7,876)
Impairment of goodwill 13 - (141,786) - (141,786)
Distribution expenses 7 (96,287) (65,596) (1,302) (67,118)
Administrative expenses 7 (1,336,486) (1,236,762) (741,469) (658,635)
Operating profit 361,357 173,664 143,897 15,148
Net Finance costs and income 8 (155,089) (114,997) (123,921) (87,475)
Share of loss from equity investment 15(ii) (2,595) (3,503) (2,595) (3,503)
Profit/(loss) before income tax 203,673 55,164 17,381 (75,830)
Income tax expense - continuing operations 10 (72,851) (63,283) (15,704) (27,799)
Profit/(loss) from continuing operations 130,822 (8,119) 1,677 (103,629)
(Loss)/profit from discontinued operations after tax 20(i) (10,604) 39,697 (10,604) 39,697
Profit/(loss) from continued and discontinued operations 120,218 31,578 (8,927) (63,932)
Profit/(loss) attributable to:
Owners of Zambeef Products PLC 118,612 29,152 (8,927) (63,932)
Non-controlling interests 1,606 2,426 - -
120,218 31,578 (8,927) (63,932)
Other comprehensive income:
Items that maybe reclassified to profit or loss
Translation differences - foreign operations 22 (40,617) (16,320) - -
Translation differences - Mpongwe Farms 22 - (10,847) - (10,847)
Items not reclassified to profit or loss
Revaluation surplus 23 1,003,412 - 977,426 -
Actuarial remeasurement losses 26(i) (768) (3,150) (425) (1,058)
Deferred income tax 25 (98,516) 6,394 (97,751) 3,018
Other comprehensive income for the year 863,511 (23,923) 879,250 (8,887)
Total comprehensive income for the year 983,729 7,655 870,323 (72,819)
Statement of profit or loss and other comprehensive income (continued)
Notes Group Company
2023 2022 2023 2022
K'000 K'000 K'000 K'000
Total comprehensive income for the year is attributable to:
Owners of Zambeef Products Plc 990,425 4,970 870,323 (72,819)
Non-controlling interests (6,696) 2,685 - -
983,729 7,655 870,323 (72,819)
Basic earnings per share Ngwee Ngwee Ngwee Ngwee
Continuing operations 30 42.99 (3.51) 0.56 (34.46)
Discontinued operations 30 (3.53) 13.21 (3.53) 13.21
Total basic earnings per share 39.46 9.70 (2.97) (21.25)
Diluted earnings per share
Continuing operations 30 32.25 (2.63) 0.42 (25.85)
Discontinued operations 30 (2.65) 9.91 (2.65) 9.91
Total diluted earnings per share 29.60 7.28 (2.23) (15.94)
Consolidated Statement of financial position
30-Sept-23 30-Sept-22
ASSETS Notes K'000 K'000
Non-current assets
Property, plant and equipment 11 4,818,533 3,167,000
Goodwill 13 25,015 25,015
Investment in associate 15 34,370 36,965
Biological assets 16 123,359 86,592
5,001,277 3,315,572
Current assets
Biological assets 16 285,039 234,104
Inventories 17 1,656,487 1,441,912
Trade and other receivables 18 332,703 289,300
Cash and cash equivalents 19 271,222 223,972
Assets classified as held for sale 20(iii) 157,640 170,091
Current income tax asset 10 - -
2,703,091 2,359,379
Total assets 7,704,368 5,674,951
EQUITY
Share capital 21 3,006 3,006
Share premium 21 1,125,012 1,125,012
Preference share capital 21 1,000 1,000
Foreign currency translation reserve 22 660,390 692,705
Revaluation reserve 23 1,964,087 1,113,119
Retained earnings 930,262 758,489
Attributable to owners of parent entity 4,683,757 3,693,331
Non-controlling interests (NCI) (6,630) 66
4,677,127 3,693,397
LIABILITIES
Non-current liabilities
Lease liabilities 12(b) 15,622 12,597
Borrowings 24 687,679 426,222
Deferred income tax 25 302,017 223,217
Defined benefit obligations 26 1,631 3,654
1,006,949 665,690
Current liabilities
Lease liabilities 12(b) 6,448 5,046
Borrowings 24 972,827 525,325
Trade and other payables 27 834,190 649,573
Contract liabilities 28 164,063 97,400
Current income tax 10 42,764 38,520
2,020,292 1,315,864
Total equity and liabilities 7,704,368 5,674,951
Consolidated statement of changes in equity
Share Share premium Preference share capital Foreign currency translation reserve Revaluation reserve Retained earnings Total attributable to owners of parent entity Non-controlling interests Total
Capital
Year ended 30 September 2022 K'000 K'000 K'000 K'000 K'000 K'000 K'000 K'000
At start of year 3,006 1,125,012 1,000 720,131 1,160,653 678,559 3,688,361 (2,619) 3,685,742
Profit for the year - - - - - 29,152 29,152 2,426 31,578
Other comprehensive income:
Transfer of excess depreciation - - - - (53,928) 53,928 - - -
Actuarial remeasurement losses - - - - - (3,150) (3,150) - (3,150)
Deferred income tax (Note 25) - - - - 6,394 - 6,394 - 6,394
Translation differences (Note 22) - - - (27,426) - - (27,426) 259 (27,167)
- - - (27,426) (47,534) 50,778 (24,182) 259 (23,923)
Total comprehensive income for the year - - - (27,426) (47,534) 79,930 4,970 2,685 7,655
At end of year 3,006 1,125,012 1,000 692,705 1,113,119 758,489 3,693,331 66 3,693,397
Year ended 30 September 2023
At start of year 3,006 1,125,012 1,000 692,705 1,113,119 758,489 3,693,331 66 3,693,397
Profit for the year - - - - - 118,612 118,612 1,606 120,218
Other comprehensive income:
Revaluation surplus - - - - 1,003,412 - 1,003,412 - 1,003,412
Transfer of excess depreciation - - - - (53,928) 53,928 - - -
Actuarial remeasurement losses - - - - - (768) (768) - (768)
Deferred income tax (Note 25) - - - - (98,516) - (98,516) - (98,516)
Translation differences (Note 22) - - - (32,315) - - (32,315) (8,302) (40,617)
- - - (32,315) 850,968 53,160 871,813 (8,302) 863,511
Total comprehensive income for the year - - - (32,315) 850,968 171,772 990,425 (6,696) 983,729
At year end 3,006 1,125,012 1,000 660,390 1,964,087 930,262 4,683,757 (6,630) 4,677,127
Statement of cash flows
Group Company
2023 2022 2023 2022
Notes K'000 K'000 K'000 K'000
Cash generated from/(used in) operations 29(i) 316,758 308,323 (29,141) 153,025
Interest paid on borrowings 29(ii) (44,646) (53,473) (44,646) (53,473)
Interest paid on leases 29(ii) (2,676) (1,813) (1,312) (784)
Benefits paid 26(i) (3,422) (9,672) (238) (3,247)
Income tax paid 10 (88,323) (44,877) (34,233) (9,828)
Net cash inflow from operating activities 177,691 198,488 (109,570) 85,693
Cash flows from investing activities
Purchase of property, plant and equipment 11 (817,295) (222,135) (504,998) (109,858)
Proceeds from disposal assets 4,025 2,819 6,165 -
Net cash outflow from investing activities (813,270) (219,316) (498,833) (109,858)
Cash flows from financing activities
Proceeds from borrowings 29(ii) 916,396 722,995 916,396 722,995
Principal repayments of borrowings 29(ii) (526,257) (526,205) (526,257) (526,205)
Principal elements of lease payments 29(ii) (7,319) (14,965) (6,016) (7,322)
Net cash inflow from financing activities 382,820 181,825 384,123 189,468
Net increase/(decrease) for the year (252,759) 160,997 (224,280) 165,303
Movement in cash and cash equivalents
At start of year (127,708) (288,665) (27,876) (193,224)
Net increase /(decrease) (252,759) 160,997 (224,280) 165,303
Exchange differences - (40) - 45
At year end 19 (380,467) (127,708) (252,156) (27,876)
Extracted from the Supplementary Information within the 2023 Annual Report.
This information presented in USD does not form part of the Financial
Statements and is therefore unaudited
Statement of profit or loss and other comprehensive income
Group Company
2023 2022 2023 2022
US$'000 US$'000 US$'000 US$'000
Revenue from contracts with customers 331,478 314,014 185,549 195,659
Change in fair value of biological assets 35,263 18,567 31,194 17,903
Cost of sales of providing goods (265,685) (237,518) (167,044) (162,734)
Gross profit 101,056 95,063 49,699 50,828
Other income/(expenses) (2,545) 145 (1,892) 1,008
Net impairment losses on financial assets (149) (1,040) (97) (458)
Impairment of goodwill - (8,253) - (8,253)
Distribution expenses (5,279) (3,818) (71) (3,907)
Administrative expenses (73,272) (71,989) (40,651) (38,337)
Operating profit 19,811 10,108 6,988 881
Share of loss from equity investment (142) (204) (142) (204)
Finance income/(expenses) (1,133) 206 (222) 206
Finance costs (7,370) (6,900) (5,670) (5,297)
Profit before income tax 11,166 3,210 954 (4,414)
Income tax expense (3,994) (3,684) (861) (1,618)
(Loss)/profit from continuing operation 7,172 (474) 93 (6,032)
Profit from asset held for sale (581) 2,311 (581) 2,311
Profit for the year 6,591 1,837 (488) (3,721)
Profit attributable to:
Owners of Zambeef Products PLC 6,503 1,696 (488) (3,721)
Non-controlling interests 88 141 - -
6,591 1,837 (488) (3,721)
Other comprehensive income:
Items that maybe reclassified to profit or loss
Translation losses on foreign operations (2,227) (946) - -
Translation losses on Mpongwe Farms - (631) - (631)
Items not reclassified to profit or loss
Revaluation surplus 55,012 - 53,587 -
Actuarial remeasurement losses (42) (183) (23) (62)
Deferred income tax (5,401) 368 (5,359) 176
Other comprehensive income for the year 47,342 (1,392) 48,205 (517)
Total comprehensive income for the year 53,933 445 47,717 (4,238)
Statement of profit or loss and other comprehensive income (continued)
Group Company
2023 2022 2023 2022
US$'000 US$'000 US$'000 US$'000
Total comprehensive income for the period is attributable to:
Owners of Zambeef Products Plc 54,300 289 47,717 (4,238)
Non-controlling interests (367) 156 - -
53,933 445 47,717 (4,238)
Basic earnings per share
Continued operations 2.36 (0.19) 0.03 (2.01)
Discontinued operations (0.19) 0.77 (0.19) 0.77
Total basic earnings per share 2.16 0.58 (0.16) (1.24)
Diluted earnings per share
Continued operations 1.77 (0.15) 0.02 (1.50)
Discontinued operations (0.15) 0.58 (0.15) 0.58
Total diluted earnings per share 1.62 0.43 (0.12) (0.92)
Consolidated statement of financial position
30-Sept-23 30-Sept-22
ASSETS US$'000 US$'000
Non-current assets
Property, plant and equipment 229,236 198,393
Right of use assets - 2,050
Goodwill 1,190 1,583
Investment in associate 1,635 2,340
Biological assets 5,869 5,480
237,930 209,846
Current assets
Biological assets 13,560 14,817
Inventories 78,805 91,260
Trade and other receivables 15,828 18,310
Cash and cash equivalents 12,903 14,175
Assets classified as held for sale 7,500 10,765
Current income tax asset - -
128,596 149,327
Total assets 366,526 359,173
EQUITY
Share capital 449 449
Share premium 185,095 185,095
Preference share capital 100 100
Foreign currency translation reserve 49,843 42,945
Revaluation reserve 51,360 65,256
Retained earnings (64,023) (60,091)
Attributable to owners of parent entity 222,824 233,754
Non-controlling interests (315) 4
222,509 233,758
LIBILITIES
Non-current liabilities
Borrowings 32,715 26,976
Lease liabilities 743 797
Deferred income tax 14,368 14,128
Defined benefit obligations 78 231
47,904 42,132
Current liabilities
Borrowings 46,281 33,248
Lease liabilities 307 319
Trade and other payables 39,686 41,113
Contract liabilities 7,805 6,165
Current income tax 2,034 2,438
96,113 83,283
Total equity and liabilities 366,526 359,173
Statement of cash flows Group Company
2023 2022 2023 2022
$'000 $'000 $'000 $'000
Cash generated from/(used in) operations 17,366 17,947 (1,598) 8,907
Interest paid on borrowings (2,448) (3,113) (2,448) (3,113)
Interest paid on leases (147) (106) (72) (46)
Benefits paid (188) (563) (13) (189)
Income tax paid (4,842) (2,612) (1,877) (572)
Net cash inflow from operating activities 9,742 11,553 (6,007) 4,988
Cash flows from investing activities
Purchase of property, plant and equipment (44,808) (12,930) (27,686) (6,395)
Proceeds from disposal assets 221 164 338 -
Net cash outflow from investing activities (44,587) (12,766) (27,348) (6,395)
Cash flows from financing activities
Proceeds from borrowings 50,241 42,084 50,241 42,084
Principal repayments of borrowings (28,852) (30,629) (28,852) (30,629)
Principal elements of lease payments (401) (871) (330) (426)
Net cash inflow from financing activities 20,988 10,584 21,059 11,028
Net increase/(decrease) for the year (13,857) 9,371 (12,296) 9,622
Movement in cash and cash equivalents
At start of year (8,083) (17,244) (1,764) (11,543)
Net increase /(decrease) (13,857) 9,371 (12,296) 9,622
Exchange differences 3,839 (210) 2,063 157
At year end (18,101) (8,083) (11,997) (1,764)
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