RNS Number:6152P
Linton Park PLC
11 September 2003
Linton Park Plc
Interim results for the period ended 30 June 2003
Chairman's Statement
Pre-tax profits for the six months ended 30 June 2003 amounted to #5,024,000
compared to #7,705,000 for the first six months of the previous year. The six
months under review has been a period of difficulty for a number of the group
operations.
Tea and coffee
Tea production is comparable to the previous year, but prices have been
disappointing. A drought in South Africa resulted in a reduced tea crop and some
gardens were closed during the period. Coffee prices continue at levels
substantially below cost of production. The very strong South African Rand and
relatively strong Kenya Shilling have resulted in a significant reduction in
income, whilst costs continue to increase in local currency terms.
Citrus
We have encountered adverse weather conditions in Australia, where drought has
led to a reduction in crop. Severe water restrictions are already in place and
this must inevitably impact on future production levels.
Edible nuts
Production of macadamia in Malawi and South Africa has been satisfactory and
prices have been relatively strong in dollar terms. Pistachio production in
California will be reduced on account of the alternate bearing cycle.
Other horticulture
Climatic conditions in South Africa and Chile led to poor table grape production
although wine grape production was satisfactory in Australia and South Africa.
The wine market, however, continues to be over supplied and prices are under
pressure. The recent improvement in the Brazilian operations has continued into
2003 and the prospects for the year are satisfactory assuming stable currency
rates.
Food storage and distribution
Profits are considerably below expectation from Associated Cold Stores &
Transport as pressure on margins continues. W. G. White is also suffering from
the decline in caviar sales.
Engineering
Our engineering activities have experienced mixed fortunes during the period
with some reasonable results being countered by a continued shortage of activity
in the aerospace and North Sea oil exploration sectors.
Pharmaceutical
Our associated company, Siegfried AG, produced very satisfactory half-year
results, which included a large one-off licence fee for its generics business.
For the second half of 2003, Siegfried has expressed caution regarding its
trading prospects and expects lower sales due to exchange rate movements and the
discontinuation of two important products. The downturn in the market for
Siegfried products will be more pronounced in 2004, but action to reduce costs
has already been implemented.
Prospects and dividend
A combination of poor commodity prices and adverse climatic conditions, coupled
with unrealistically high local currency rates compared to the dollar, has led
to a very unsatisfactory situation and indeed the Group would be loss making if
it were not for the contribution from its associated company, Siegfried. These
conditions are as difficult as any that I can recall over the last twenty five
years and there appears to be little prospect of any alleviation in the short
term. In these circumstances the Board has considered carefully the level of
interim dividend and has declared a dividend of 3p per share compared with 5p
per share for the corresponding period last year. The dividend will be payable
on 6 November 2003 to shareholders on the register on 17 October 2003.
M C Perkins Linton Park
Chairman Linton
Near Maidstone
11 September 2003 Kent ME17 4AB
Consolidated profit and loss account
for the six months ended 30 June 2003
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
Notes #'000 #'000 #'000
Turnover
- continuing operations 62,844 60,893 125,468
discontinued operations - 3,447 6,761
---------- ---------- ----------
1 62,844 64,340 132,229
---------- ---------- ----------
Operating (loss)/profit
- continuing operations 2 (793) 3,954 6,563
discontinued operations - 35 (3)
---------- ---------- ----------
(793) 3,989 6,560
Share of associates'result -
Profit before interest 6,492 5,175 10,547
---------- ---------- ----------
Operating profit including
associates 1 5,699 9,164 17,107
Profit on disposal of
fixed assets 3 558 - 195
Profit/(provision for loss)
on disposal of a subsidiary
and a business 4 98 - 4
---------- ---------- ----------
Profit on ordinary activities
before interest 6,355 9,164 17,306
Net interest payable
including share of
associates' net interest 5 1,331 1,459 2,692
---------- ---------- ----------
Profit on ordinary activities
before taxation 5,024 7,705 14,614
Taxation 6 1,186 2,247 3,607
---------- ---------- ----------
Profit on ordinary activities
after taxation 3,838 5,458 11,007
Minority interests (171) 856 1,623
---------- ---------- ----------
Attributable profit 4,009 4,602 9,384
---------- ---------- ----------
Dividends:
Interim of 3.00p per share 571 952 952
(2002:5.00p)
Final for 2002 of 13.00p - - 2,475
per share
Earnings per 7 21.1p 24.2p 49.3p
share
Consolidated Balance Sheet
at 30 June 2003
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Fixed assets
Intangible assets (684) (1,076) (814)
Tangible assets 130,061 128,640 127,706
Investments 58,751 53,245 56,341
---------- ---------- ----------
188,128 180,809 183,233
---------- ---------- ----------
Current assets
Stocks 16,878 18,246 19,484
Debtors 25,479 22,463 21,756
Cash and deposits 4,690 6,724 5,740
---------- ---------- ----------
47,047 47,433 46,980
Creditors: due within one year (39,081) (34,628) (39,083)
---------- ---------- ----------
Net current assets 7,966 12,805 7,897
---------- ---------- ----------
Total assets less current 196,094 193,614 191,130
liabilities
Creditors: due after one year (29,326) (31,800) (29,032)
Provisions for liabilities and
charges (4,483) (5,318) (5,497)
---------- ---------- ----------
162,285 156,496 156,601
---------- ---------- ----------
Capital and reserves
Called up share capital 9,519 9,519 9,519
Reserves 123,912 117,576 117,952
---------- ---------- ----------
Equity shareholders' funds 133,431 127,095 127,471
Minority interests 28,854 29,401 29,130
---------- ---------- ----------
162,285 156,496 156,601
---------- ---------- ----------
Consolidated cash flow statement
for the six months ended 30 June 2003
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
Notes #'000 #'000 #'000
Cash flow from operating
activities 8 798 4,664 11,617
Dividends received/capital
distribution from associates 2,111 446 788
Returns on investments and
servicing of finance (1,925) (1,939) (2,722)
Taxation paid (461) (994) (2,087)
Capital expenditure and
financial investment (2,640) (3,281) (7,757)
Acquisitions and disposals 971 464 223
Equity dividends paid - - (3,427)
---------- ---------- ----------
Cash outflow before financing (1,146) (640) (3,365)
Financing
New loans 4,269 5,456 5,373
Loan and finance lease payments (2,955) (2,313) (4,544)
---------- ---------- ----------
1,314 3,143 829
---------- ---------- ----------
Increase/(decrease)in cash 9
in period 168 2,503 (2,536)
---------- ---------- ----------
Reconciliation of movements in shareholders' funds
Attributable profit for the period 4,009 4,602 9,384
Dividends (571) (952) (3,427)
Exchange differences 2,522 (71) (2,002)
---------- ---------- ----------
Net addition to shareholders'
funds 5,960 3,579 3,955
Opening equity shareholders' funds 127,471 123,516 123,516
---------- ---------- ----------
Closing equity shareholders' funds 133,431 127,095 127,471
---------- ---------- ----------
Notes to the accounts
1 Segmental analysis of turnover and operating profit
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Turnover
By activity
Agriculture and horticulture 34,619 33,171 69,918
Food storage and distribution 20,451 21,195 42,733
Engineering 7,721 6,461 12,661
Trading and agency 53 66 156
---------- ---------- ----------
62,844 60,893 125,468
Discontinued - Trading and agency - 3,447 6,761
---------- ---------- ----------
62,844 64,340 132,229
---------- ---------- ----------
By country of origin
United Kingdom 23,375 22,702 45,147
Continental Europe 4,797 4,959 10,290
Kenya 9,825 10,025 20,787
Malawi 7,291 7,232 9,634
United States of America 244 146 1,439
Australia 9,399 7,869 22,858
South Africa 7,485 7,442 14,835
South America 428 518 478
---------- ---------- ----------
62,844 60,893 125,468
Discontinued - United Kingdom - 3,447 6,761
---------- ---------- ----------
62,844 64,340 132,229
---------- ---------- ----------
Operating Profit
By activity
Agriculture and horticulture 316 4,122 7,681
Food storage and distribution (441) 281 541
Engineering 472 476 479
Trading and agency 724 690 376
---------- ---------- ----------
1,071 5,569 9,077
Discontinued - Trading and agency - 35 (3)
---------- ---------- ----------
Trading operations 1,071 5,604 9,074
Net unallocated expenses (1,864) (1,615) (2,514)
---------- ---------- ----------
Operating profit (793) 3,989 6,560
Associated undertakings
Pharmaceutical 6,242 5,108 10,504
Agriculture and horticulture 250 67 43
---------- ---------- ----------
5,699 9,164 17,107
---------- ---------- ----------
Operating Profit - trading operations
By country of origin
United Kingdom 724 1,410 1,224
Continental Europe (1) 2 120
Kenya 149 1,043 3,243
Malawi 2,384 2,303 1,563
United States of America (36) (160) 460
Australia (589) 89 1,453
South Africa (1,591) 903 1,246
South America 31 (21) (232)
---------- ---------- ----------
1,071 5,569 9,077
Discontinued - United Kingdom - 35 (3)
---------- ---------- ----------
1,071 5,604 9,074
---------- ---------- ----------
2 Business interruption insurance proceeds of #268,000 (2002: six months
#415,000 - year #829,000) have been credited to operating profit.
3 Profit on disposal of fixed assets
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Profit on disposal of unlisted
investment 558 - -
Profit on disposal of property - - 195
---------- ---------- ----------
558 - 195
---------- ---------- ----------
The profit on disposal of unlisted investment relates to The Tay Salmon
Fisheries Company Limited in which the group had a 13.0 per cent. holding.
4 Profit/(provision for loss) on disposal of a subsidiary and a business
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Profit on disposal of a subsidiary 280 - 4
Provision for loss on disposal of
a business (182) - -
---------- ---------- ----------
98 - 4
---------- ---------- ----------
A profit of #280,000 was realised on the disposal of the group's 74.9 per
cent. interest in British Traders & Shippers Limited. In addition a provision
of #182,000 relates to SWF Citrus Inc.'s citrus estates in Florida which are
in the course of disposal.
5 Net interest payable includes #245,000 (2002: six months #327,000 - year
#473,000) in respect of the group's share of Siegfried's net interest.
6 Taxation includes overseas taxation of #183,000 for the six months (2002:
six months #1,181,000 - year #1,748,000) and share of associated
undertakings' taxation charge of #1,449,000 (2002: six months #1,096,000 -
year #1,883,000).
7 Earnings per share have been calculated by dividing the weighted average
number of ordinary shares in issue of 19,038,167 (2002: six months 19,038,167
- year 19,038,167) into the profit for the six months of #4,009,000 (2002:
six months #4,602,000 - year #9,384,000).
8 Reconciliation of operating profit to cash flow from operating activities
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Operating(loss)/profit (793) 3,989 6,560
Depreciation 3,484 3,443 6,510
Amortisation of intangible
fixed assets (130) (140) (277)
Income from investments (139) (140) (244)
Profit on disposal of fixed assets (89) (214) (185)
Increase in working capital (1,535) (2,274) (747)
---------- ---------- ----------
798 4,664 11,617
---------- ---------- ----------
9 Reconciliation of net cash flow to movement in net debt
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Increase/(decrease) in cash in
the period 168 2,503 (2,536)
Cash inflow from increase in debt (1,314) (3,143) (829)
---------- ---------- ----------
Increase in net debt resulting
from cash flows (1,146) (640) (3,365)
Net overdraft of business sold 136 666 713
Exchange rate movements (554) (480) (566)
---------- ---------- ----------
Increase in net debt in the
period (1,564) (454) (3,218)
Net debt at beginning of period (38,972) (35,754) (35,754)
---------- ---------- ----------
Net debt at end of period (40,536) (36,208) (38,972)
---------- ---------- ----------
10 The interim report has been prepared on the basis of the accounting
policies set out in the report and accounts for the year ended 31 December
2002. The six months figures are unaudited and have not been reviewed by the
company's auditors. The figures for the year ended 31 December 2002 are an
abridged statement from the group accounts at that date which have been
delivered to the Registrar of Companies. The Auditors' Report on these
accounts was unqualified.
11 The interim dividend of 3.00p per share is payable on 6 November 2003 to
shareholders on the register on 17 October 2003.
12 The interim report will be posted to shareholders and will be available to
the public this afternoon, 11 September 2003.
Press enquiries
Malcolm Perkins,
Chairman
01622 746655
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