TIDMMGL
MARSHALL MONTEAGLE HOLDINGS SOCIETE ANONYME
(Incorporated in Luxembourg. R.C. No. B 19600)
ISIN LU0035797272
Registered Office
58 rue Charles
Martel,
L-2134 Luxembourg
31st December 2010
Preliminary announcement of unaudited results for the year ended 30thSeptember
2010
Introduction
The directors are pleased to report a strong performance by the group's diverse
operations and investments, especially as the year was characterised by
volatility in both equity and currency markets.
Marshall Monteagle's objective is to achieve capital growth internationally and
pay a steadily progressive dividend over the long term from a diversified range
of investments. The company holds portfolios of leading investments in the
U.K., Europe, U.S.A. and the Far East as well as commercial properties in the
U.S.A and South Africa. The group's import and distribution businesses operate
internationally, and in South Africa it has interests in food processing and
logistics.
Results
* Group revenue is up 40% to US$163,870,000 for the twelve months to 30th
September 2010, compared to US$117,262,000. In constant currency sales
increased by US$30,713,000(26%) Profit before tax and exceptional items is
higher at US$7,950,000 from US$4,606,000.
* The directors are proposing a final dividend of 3.00 US cents, making a
total of 6.00 US cents (2009 - 5.00 US cents) for the year.
* Net assets attributable to shareholders increased by 4% to US$3.29 per
share from US$3.17 at 30th September 2009; US$1.68 of net assets per share
- 51% (2009 - 45%) are held in Europe and U.S.A. The remaining assets,
equivalent to US$1.61 per share - 49% (2009 - 55%) are held predominantly
in South Africa.
Import and Distribution
Our import and distribution business in food and household consumer products
achieved further growth during the year. This division continues to provide
procurement, supply chain and risk management services to multiple retailers,
wholesalers and manufacturers in Southern and Central Africa, Indian Ocean
Islands and Australia. It brings the benefits of dedicated producers of quality
raw materials, skilled technologists, first world production facilities and
well managed warehousing and distribution services to our customers.
The division continued to experience volatile raw material pricing and
availability during the year, but ocean freight rates and logistical costs
remained reasonably stable. As a result of a softer US Dollar and further
pricing pressure on international producers, we increased trade to developing
markets in Southern and Central Africa. With the many financial and economic
imbalances currently being experienced internationally, we expect continued
volatility during the year ahead, but we are well positioned to operate in
these market conditions.
Our tool and machinery import and distribution businesses had another
challenging year, but product enhancements and diversification allowed the
business access to new markets and resulted in a pleasing increase in sales and
profits. The tough trading environment in this sector looks set to continue in
the near term, however management are focusing their efforts on maintaining
margins, controlling costs and keeping service levels as high as possible.
Property Portfolio
Our large multi-tenanted industrial property in San Diego enjoyed a slightly
lower vacancy rate of 12% during the year, but the market remains challenging
with downward pressure on rents and excess capacity in the region. As mentioned
previously, the property is situated in one of the most sought after industrial
areas in Southern California and the Company is a long term holder of this
quality asset.
The group's portfolio of commercial and light industrial properties in South
Africa produced good returns due to active property and cost management, which
kept efficiency ratios and vacancy levels below market norms.
Investment Portfolio
It has been another volatile year for global equity markets which have in the
most part been driven by fears of deflation, the stability of the financial
system and the growing sovereign debt issues in the Euro-zone. Despite these
factors the broader market finished the year in positive territory and our
holdings appreciated materially. The group continues to hold a diverse
portfolio of quality equities in first world markets.
Conafex Holdings S.A. / Coffee Acquisition
Towards the end of the financial year the Company completed the disposal of its
stake in Conafex in exchange for the coffee companies owned by Conafex and
US$292,000 in cash. The coffee interests are now wholly owned and include a
roasting plant in Cape Town and a trading company that imports green beans into
the South African market.
This brings to an end a very long association between the Group and Conafex.
For most of this period Conafex has been headed up by Chris Jousse and the
board would sincerely like to thank Mr. Jousse for his courageous leadership
and the contribution he and his colleagues have made to the Group over the
years.
Halogen Holdings P.L.C. (unlisted associate)
Halogen Holdings owns 78% of the total issued share capital of Heartstone Inns,
a developing UK group of country pubs specialising in quality food. Heartstone
currently owns the freehold of five pubs, which it manages, and it is looking
to acquire additional pubs through an associated tax efficient investment
company which has already acquired the freehold of three quality pubs. Despite
the losses incurred to date, Heartstone is cash positive and its prospects
continue to improve due to economies of scale.
Holding Company Re-organisation
The favourable tax situation enjoyed by the Company expires on 31st December
2010 and as a result we are putting in place a new holding company based in
Jersey, Channel Islands. To achieve this, the current Luxembourg holding
company will need to be placed into voluntary liquidation. Since there has been
no trade in the company's shares in London in the last few years and negligible
trading in Luxembourg, the Board will be proposing that following the
reorganisation the Company is only listed in Johannesburg. We have prepared a
circular setting out in full the Board's proposals and this will be sent to
shareholders in early 2011 upon approval by the Johannesburg Stock Exchange.
Accompanying the circular will be a notice for the EGM that will be required to
effect this restructuring.
Group Personnel
These good results could not have been achieved without the hard work of all
our employees and, on behalf of all shareholders, the directors thank them most
sincerely for their efforts and contribution during the year.
Prospects
The Group's import and distribution businesses which are mainly based in South
Africa have enjoyed strong growth recently and their prospects for the year
ahead are good. Occupancy levels in the Group's investment properties are
stable but the outlook for this market remains uncertain.
The Group's investment portfolio remains in quality companies and our liquidity
will allow us to take advantage of future buying opportunities.
J.M. Robotham D.C. Marshall
Chairman Chief Executive
POSTING OF ANNUAL REPORT AND NOTICE OF ANNUAL GENERAL MEETING
The annual report will be mailed to shareholders on or before 26th February
2010.
Consolidated Statement of Comprehensive Income
for the year ended 30th September 2010 2009
US$000 US$000
Group revenue 163,870 117,262
Operating costs (154,060) (110,392)
------------ ------------
Operating profit 9,810 6,870
Share of associated companies' results (285) (271)
Income from other investments - dividends 397 350
- interest 670 596
Interest paid and similar charges (2,461) (2,259)
Realised exchange losses (181) (680)
------------ ------------
Profit on ordinary activities before exceptional items 7,950 4,606
and tax
Exceptional items (327) (3,455)
------------ ------------
Profit before tax and minority interests 7,623 1,151
Taxation on ordinary activities before exceptionals (2,678) (1,423)
------------ ------------
Profit/(Loss) after tax before minority interests 4,945 (272)
Minority interests (2,012) (1,169)
------------ ------------
Profit/(Loss) attributable to shareholders of the Group 2,933, (1,441)
Other Comprehensive Income:-
Exchange differences on translation of the financial 33 2,432
statements of foreign entities
Group share of fair value adjustments of financial 88 (1,142)
instruments
Group share of commercial property revaluations 122 57
------------ ------------
Total Comprehensive Income 3,176 (94)
======= =======
Basic and fully diluted earnings/(loss) per share (US 16.4 c (8.3)c
cents)
Headline earnings per share (US cents) 17.0 c 10.8 c
Reconciliation of headline earnings per share
Earnings attributable to ordinary shareholders 2,933 (1,441)
Add Adjusting exceptional items (see note) 101 3,305
------------ ------------
3,034 1,864
======= =======
Consolidated Statement of Changes in Equity
Total Comprehensive Income 3,176 (94)
------------ ------------
Transactions with shareholders:-
Dividend paid for the previous year (533) (496)
Unclaimed dividends forfeit - 89
Shares issued to acquire minority interests 415 3,171
Interim dividend paid (538) (353)
------------ ------------
Total transactions with shareholders (656) 2,411
------------ ------------
Shareholders' funds brought forward 56,405 54,088
------------ ------------
Shareholders' funds carried forward 58,925 56,405
======= =======
Unaudited Consolidated Balance Sheet
at 30th September 2010 2009
US$000 US$000
Assets
Non current assets
Property, plant and equipment 41,637 38,740
Investments 17,380 17,480
------------ ------------
59,017 56,220
Current assets ------------ ------------
Inventories 26,393 22,837
Accounts receivable 30,922 22,633
Cash and bank balances 11,379 11,347
------------ ------------
68,694 56,817
Current liabilities
Accounts payable (falling due within one year) (43,259) (32,222)
------------ ------------
Net current assets 25,435 24,595
------------ ------------
Total assets less current liabilities 84,452 80,815
Non current liabilities
Accounts payable (falling due after more than one year) (10,453) (11,566)
Deferred taxation (3,258) (2,632)
------------ ------------
70,741 66,617
======= =======
Capital and reserves
Called up share capital 26,893 26,673
Share premium account 4,905 4,710
Other reserves 7,468 7,332
Retained earnings 19,659 17,690
------------ ------------
Shareholders' funds 58,925 56,405
Minority interests 11,816 10,212
------------ ------------
70,741 66,617
======= =======
Net Assets per Share at market values 2010 2009
US$ US$
Europe, U.S.A. and other 1.68 1.46
South Africa 1.61 1.71
------------ ------------
3.29 3.17
======= =======
Unaudited Consolidated Cash Flow Statement
for the year ended 30th September 2010 2009
US$000 US$000
Operating activities
Cash generated by operations 5,917 3,338
Interest paid (2,461) (2,259)
Taxation paid (1,760) (807)
------------ ------------
Net cash inflow from operating activities 1,696 272
------------ ------------
Investment activities
Purchase of tangible non-current assets (1,116) (1,108)
Acquisition of investments (2,898) (444)
Proceeds of disposal of tangible non-current assets 508 329
Proceeds of disposal of investments 2,371 3,108
Net proceeds of disposal of associate less subsidiaries 292 -
acquired
Interest received and other investment income 1,067 946
------------ ------------
Net cash inflow from investment activities 224 2,831
------------ ------------
Net cash inflow before financing 1,920 3,103
------------ ------------
Financing activities
Net increase/(decrease) in long term debt (1,113) 489
Cost of new shares issued to acquire minority interests (6) (150)
Dividends paid - group (1,071) (849)
Dividends paid -minorities (932) (593)
------------ ------------
Net cash (outflow) from financing activities (3,122) (1,103)
------------ ------------
Net (decrease)/increase in funds (1,202) 2,000
Net funds/(debt) at 1st October 9,445 7,094
Effect of foreign exchange rate changes 344 351
------------ ------------
Net funds at 30th September 8,587 9,445
======= =======
SEGMENTAL REPORTING
Primary reporting format - business segments
The Group is organised on a worldwide basis into the following main business
segments:
Import and distribution Tool import and non-perishable food imports to and
exports from South Africa; non-perishable food imports
to Japan and Australia.
Property Investment properties in California and South Africa.
Other activities Mainly transactions relating to the share portfolios,
profits on disposals of tangible and intangible
non-current and local head office costs.
There are no sales between business segments. Segment assets consist of
property, plant and equipment, inventories and receivables and exclude cash
balances. Segment liabilities are operating liabilities and exclude items such
as taxation and borrowings. Capital expenditure comprises additions to
property, plant and equipment.
Unallocated assets and liabilities are cash balances, taxation and borrowings.
2010 2009
Segmental analysis of results US$000 US$000
Revenue Result Revenue Result
Import and distribution 159,447 9,363 113,426 6,127
Property 4,354 1,608 3,453 1,305
Other activities 69 (275) 383 (296)
----------- ----------- ----------- -----------
163,870 10,696 117,262 7,136
======= =======
Share of associates (285) (271)
Interest paid and similar charges (2,461) (2,259)
----------- -----------
7,950 4,606
Exceptional items (327) (3,455)
----------- -----------
Profit before tax 7,623 1,151
======= =======
* Revenue of "Other activities" excludes dividend income and the proceeds of
sales of investments and tangible assets. Profits on sales of investments and
tangible assets are included in exceptional items.
Assets Liabilities Net assets/ Capital Depreciation
(liabilities) expenditure charge
US$000 US$000 US$000 US$000 US$000
Segmental analysis of net assets 30th September 2010
Import and distribution 64,028 (35,260) 28,768 541 401
Property 34,356 (890) 33,466 575 52
Associate - Other 1,797 - 1,797 - -
Other activities 15,929 (740) 15,189 - 14
(including investments)
Unallocated (including 11,601 (20,080) (8,479) - -
cash, tax and debt)
----------- ----------- ----------- ----------- -----------
Consolidated total 127,711 (56,970) 70,741 1,116 467
======= ======= ======= ======= =======
Segmental analysis of net assets 30th September 2009
Import and distribution 51,354 (28,819) 22,535 929 333
Property 31,814 (811) 31,003 179 56
Associate - Food 1,567 - 1,567 - -
production
Associate - Other 2,105 - 2,105 - -
Other activities 14,661 (77) 14,584 - 16
(including investments)
Unallocated (including 11,537 (16,714) (5,177) - -
cash, tax and debt)
----------- ----------- ----------- ----------- -----------
Consolidated total 113,038 (46,421) 66,617 1,108 405
======= ======= ======= ======= =======
Secondary reporting format - geographical segments
The Group operates in the following countries or states.
Luxembourg The non-trading location of the parent company where part of the
Group investment portfolio is located.
South Africa Location of the bulk of the Group's import and distribution
business and part of the Group's property portfolio.
Australia Location for part of the Group's import and distribution business.
United States Part of the Group's property and investment portfolios are
located here.
Jersey Location of part of the Group's import and distribution business and
part of the Group's investment portfolio.
2010 2009
Group Total Capital Group Total Capital
revenue net assets expenditure revenue net assets expenditure
US$000 US$000 US$000 US$000 US$000 US$000
Australia 2,222 3,716 - 2,145 3,469 40
United States 1,000 9,002 - 1,032 8,415 91
Jersey 37,702 12,387 - 32,607 7,627 -
Luxembourg - 6,881 - - 7,455 -
----------- ----------- ----------- ----------- ----------- -----------
Total outside 40,924 31,986 - 35,784 26,966 131
Africa
South Africa 122,946 38,755 1,116 81,478 39,651 977
----------- ----------- ----------- ----------- ----------- -----------
163,870 70,741 1,116 117,262 66,617 1,108
======= ======= ======= ======= ======= =======
Total assets and capital expenditure are shown by the geographical area in
which the assets are located.
EXCEPTIONAL ITEMS 2010 2009
US$000 US$000
Income
Property revaluations 336 -
Release of investment provisions - 89
----------- -----------
Total income 336 89
Charges
Property revaluations - (2,986)
Fair value adjustments on financial assets (83) (161)
Loss on disposal of non-current tangible assets (135) (3)
Loss on disposal of investments (219) (244)
----------- -----------
Total net adjusting items for headline earnings (101) (3,305)
Costs of acquisition (6) (150)
Re-organisation costs (220) -
----------- -----------
Total exceptional items - net (charges) (327) (3,455)
======= =======
Notes:
1. These preliminary results for the year ended 30th September 2010 and the
balance sheet at that date comply with International Financial Reporting
Standards and have been prepared on the basis of accounting policies
adopted for the year ended 30th September 2009.
2. Group capital expenditure in the year was US$1,116,000 (2008 -
US$1,108,000). There were no capital expenditure commitments at 30th
September 2010 (2009 - nil).
3. Bank loans and overdrafts of US$2,856,000 (2008 - US$1,902,000) are
included in current liabilities. Group long-term finance is secured on
various local properties and bears interest at local commercial rates.
4. Earnings per share and headline earnings per share are based on the result
attributable to shareholders of the Company and on the weighted average of
shares in issue 17,855,541 (2009 - 17,320,428).
END
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