TIDMLONR
RNS Number : 7342J
Lonrho PLC
10 August 2012
10 August 2012
Lonrho Plc ("Lonrho", the "Company" or the "Group")
Interim Results Announcement
Lonrho reports strong revenue growth and improved margins.
Lonrho repositioned itself as a significant African focused
agriculture and logistic company following the successful
separation and London Stock Exchange listing of its Aviation
division as FastJet Plc.
Lonrho announces its results for the half year to 30 June 2012
incorporating an update on trading in the second quarter of 2012
and material transactions to 10 August 2012.
Financial Highlights for the six months to 30 June 2012*:
-- Reported revenue in the 6 months to June 2012 rose 79.2% from
GBP68.6 million to GBP122.9 million, a like-for-like increase of
29.1%.
-- Reported gross margin for the 6 months stands at 25.6%,
having increased 3.6% on a like for like basis. Net operating
profit from the core divisions (excluding aviation) for the 6
months to June 2012 was GBP4.7 million, an increase of GBP6.5
million over the 6 months to June 2011.
-- Net assets at 30 June 2012 stood at GBP209.8million. At 31
December 2011 the comparative figure was GBP155.7 million.
-- Net debt reduced in the first half by 23% to GBP78.7 million
at 30 June 2012 compared with GBP102.7 million at 31 December
2011.
-- An exceptional gain of GBP33.9 million has been taken through
the income statement due to the recognition in Lonrho's accounts of
FastJet Plc as a jointly controlled entity. As a result profit
before tax for the six month period was GBP23.7 million.
Financial and Operating Highlights for the quarter to 30 June
2012*:
-- Revenue in the second quarter increased 82.9% to GBP64.0
million (2011: GBP35.0 million). Like-for-like revenue increased by
22.9%.
-- Gross margins across the Group have risen by 2.0% on an
adjusted like-for-like basis in the quarter and growth has been
experienced across all of the Company's operating divisions.
Continuing Operations 2(nd) Quarter 1(st) Half
Quarter Reported Adjusted 6 months Reported Adjusted
to June growth like-for-like** to June growth like-for-like**
2012 growth 2012 growth
----------------------- ------------ --------- ----------------- ------------ --------- -----------------
GBP million GBP million
Revenue
- Agribusiness 35.8 135.5% 15.9% 72.7 129.3% 30.5%
- Infrastructure 6.5 12.1% 18.2% 10.9 9.0% 12.4%
- Hotels 2.7 17.4% 8.0% 5.1 13.3% 4.1%
- Support Services 8.5 54.5% 47.3% 14.0 30.8% 24.8%
Core Divisions 53.5 85.8% 19.6% 102.7 80.5% 25.9%
----------------------- ------------ --------- ----------------- ------------ --------- -----------------
- Transportation 10.5 69.4% 46.0% 20.2 72.6% 50.4%
Lonrho Plc 64.0 82.9% 22.9% 122.9 79.2% 29.1%
----------------------- ------------ --------- ----------------- ------------ --------- -----------------
Group Gross
Margin 23.8% 3.8% 2.0% 25.6% 4.0% 3.6%
----------------------- ------------ --------- ----------------- ------------ --------- -----------------
*throughout this announcement prior year comparisons refer to
the six months to June 2011. In the interim financial statements
the comparative period is the six months to 31 March 2011
**includes acquisitions (pre-acquisition comparables based on
un-audited management accounts), excludes start-up businesses
trading for less than 12 months and is adjusted to constant
currency
During the quarter, having completed its investment objectives
for its aviation division, Lonrho separated its aviation division
from Lonrho Plc into a stand alone, listed company, Rubicon Plc,
subsequently renamed FastJet Plc. The transaction was for a
consideration of GBP55.1 million paid in FastJet Plc shares.
FastJet Plc shares are traded on the London AIM market. The
transaction gave Lonrho an initial 73.7% stake in the enlarged
share capital of FastJet.
Sir Stelios Haji-Ioannou, the founder and major shareholder of
easyJet, the world's most successful low cost airline, and his
easyGroup have become a shareholder in FastJet and, following
significant due diligence of the market opportunity, Sir Stelios
has introduced a new world class management team to the company to
build FastJet into the low cost airline for Africa.
-- Since the completion of the transaction, FastJet has raised
an additional GBP5.5 million of new equity which will be used for
the roll out of the Fastjet model throughout Africa. Consequently
Lonrho's holding in FastJet became 67.8%.
-- Rubicon has also announced it has entered into an agreement
with Airbus for FastJet to use the A319 model as its aircraft
choice. The first aircraft is due to be delivered by October with 5
due to become operational within 6 months of launch.
-- The costs related to the separation, listing and
restructuring of Fly540 to become FastJet Plc had an unavoidable
impact of slowing down the development of Fly540 during the
transition period and the introduction of the new management team
and shareholders. This has resulted in a net operating loss of
GBP8.8million in the Aviation division for Lonrho in the
period.
The first half of the financial year has seen the Group continue
to see real growth in revenue and profitability of the Group's core
businesses. Key highlights for the quarter include:
-- Oceanfresh has begun delivery of hake loins to Costco in the
USA under the 'Kirkland Signature' brand. The start of delivery
plus good momentum in domestic markets has led to the business
seeing revenue in Q2 jump 63% on the prior year.
-- Lonrho's hotel division has seen the opening of the Lansmore
- Masa Square, in Gaborone, Botswana. The hotel has 153 rooms which
will be fully operational by September, with the hotel expected to
develop to be the leading 5 star hotel in Botswana.
-- Lonrho's services provider, AFEX delivered services to Fluor
including logistics, warehousing and vehicle supply during the
quarter. This contract, along with continued strong performance of
the fixed camps, and services to customers such as Tullow, has
helped to significantly increase revenues in the period.
-- Fresh Direct's Strawberry project for Pick'n'Pay has been
more successful than budgeted with in excess of 6,000kgs being
produced weekly. This has meant that the business has seen revenues
in the quarter top GBP2.0 million and the program has been extended
to a full annual cycle.
-- Kwikbuild has now completed delivery of 31% of schools on the
Eastern Cape project. The remaining schools will be delivered in
the coming quarter with new projects now in the sales pipeline.
Lonrho's nominated Directors on the LonZim board stepped down in
the first quarter of 2012. LonZim has subsequently renamed itself
Cambria Africa Plc., with Lonrho remaining as Cambria's largest
shareholder holding a 22.9% stake as at 30 June 2012. As a result
of these changes Lonrho no longer accounts for Cambria as an
associate company but instead reports it's holding as an investment
on the balance sheet. This resulted in an income statement
write-down of GBP3.3 million in the period.
Following a very successful six months, and the separation of
the aviation division, the Company is in a solid position to
continue to deliver on its core businesses. The global economic
environment remains challenging and it is difficult to predict the
impact on some of the Group's export markets. However, the Group
has achieved a number of key milestones in the first half of the
year which the Board believes that will help to deliver continued
growth in the second half, traditionally a stronger sales period
for the Group. The Board is confident that there is now a strong
platform in place across the Group's four core operating divisions
from which it can continue to successfully drive the profitability
and cash generation of each. It remains the Board's intention to
introduce a dividend policy that will be made public during 2012
for introduction during 2013.
David Lenigas, Lonrho's Executive Chairman, commented:
"Lonrho continues to deliver strong growth in revenues and
margins in its core business divisions and is continuing to see the
growth convert into operating profitability as planned. The
successful completion of Lonrho's investment phase in the aviation
division, and its subsequent separation to become FastJet plc,
demonstrates Lonrho's ability to build value creating businesses
with strong potential. Sir Stelios and his new management team will
allow the airline to develop rapidly and grow to meet the clear
market opportunities for a reliable international standard low cost
carrier for Africa.
Lonrho is now able to focus on its core businesses in
agriculture and logistics. These businesses generated like for like
revenue growth in the 6 months of 26.4% and net operating profit of
GBP4.7 million. Our operational businesses are directly aligned
with the economic drivers of emerging Africa therefore Lonrho is
well placed to continue to deliver growth."
Lonrho will be hosting a conference call for analysts to discuss
the Group's half year trading update with David Lenigas, Geoffrey
White and David Armstrong on Friday 10(th) August 2012 at 9:30am.
For details on the call please contact FTI Consulting.
ENDS
Enquiries:
+44 (0) 20 7016 +44 (0) 20 7831
Lonrho Plc 5105 FTI Consulting 3113
David Lenigas Edward Westropp
Geoffrey White Georgina Bonham
David Armstrong
Chief Executive's Statement
During the six month period ended 30 June 2012 Lonrho completed
its five year programme of developing operational hubs in East,
West and South-West Africa for Lonrho Aviation and subsequently
completed the strategic separation of its aviation division for a
consideration of US$85.7m (GBP55.1m) to Rubicon Diversified
Investments Plc ("Rubicon"), later renamed FastJet Plc ("FastJet")
on 6 August 2012. With the completion of this transaction, Lonrho
will not invest any further funds into FastJet which is self
funding and which has successfully raised new funding from the
market since listing.
In line with our stated strategy, Lonrho is now able to focus on
its remaining four core operating divisions, all of which saw
strong growth and gross margin improvements during the period,
resulting in a net operating profit* of GBP4.7m being achieved
across the four divisions.
Lonrho's core operational businesses are solely focused on the
opportunities that are available across Africa. Today, Africa
contains seven out of the top ten fastest growing economies in the
world with a number of countries consistently reporting double
digit growth in GDP. Africa contains 60% of the world's arable land
and 15% of the world's proven oil and gas reserves, with further
reported finds increasing reserves monthly. The global economy is
becoming increasingly dependent on African agricultural output to
meet consumer demand and African oil & gas production to meet
future energy requirements. As a result of the foreign direct
investment that the development of these industries has attracted
to Africa and the economic development that they stimulate, there
is a rapid emergence of the middle-class consumer. This active
socio-economic group within African society has triggered a
subsequent sharp increase in consumer demand.
Africa's population of more than one billion has become a
significant consumer market, with formal domestic consumption
forecast to reach US$ 1.6 trillion by 2020 (with the informal
sector believed to be as much again). Additional factors
underpinning the Continent's growth are a mineral products boom,
infrastructure development and an improvement in economic
governance.
Lonrho is increasingly seen as a 'proxy' for the African
emerging market. Over the past four years, it has aligned its
operations with the drivers of African economic development,
namely, Agriculture, Oil & Gas, Minerals and the growing
domestic population and the rapidly expanding consumer marketplace
they have created. The Company's one hundred and three year legacy
of building successful businesses across the Continent provides
Lonrho with an unparalleled brand awareness and depth of support
that gives it a significant commercial advantage in Africa.
Lonrho is unique in that it only operates in Africa, where it
understands the markets in which it is active and has the
reputation and respect necessary to deliver in the African market,
whilst being listed on the main market of the London Stock Exchange
and operating to international standards.
After the transfer of the aviation division to FastJet, Lonrho's
core operational businesses focus on:
% revenue ** YOY % growth***
Agribusiness: Agriculture and Agri-logistics 71% 130%
Infrastructure: Oil & gas logistics terminals and
Prefabricated buildings 10% 47%
Hotels: International and budget hotels 5% 21%
Support Services: IT and Integrated support services 14% 79%
* As defined in Note 3b
** Excluding aviation
***Throughout these interim accounts the comparative period used
is the 6 months ended 31 March 2011 due to the change in the
Group's year end in 2011
Financial Highlights for the 6 months to 30 June 2012
-- Revenue of GBP122.9m, an increase of 101.1% from the 6 months to 31 March 2011
-- Gross margins of 25.6%, an increase of 1.5% from 2011
-- Net assets at 30 June 2012 increased by 35% to GBP209.8m
compared with GBP155.7m at 31 December 2011
-- Net indebtedness decreased by 23% to GBP78.7m as at 30 June
2012 compared with GBP102.7m as at 31 December 2011
-- Net operating profit from the core operating divisions of
GBP4.7m compared with GBP0.7m in the 6 months to 31 March 2011
-- Profit before tax of GBP23.7m including a net gain of
GBP33.9m from the transfer of the aviation division to joint
control
Lonrho's aviation division separates to become FastJet
The most significant change to the Group during the period was
the separation of Lonrho's aviation division (the Fly540 regional
airline) into Rubicon, whose shares trade on AIM, for a
consideration of GBP55.1m (US$85.7m) satisfied by the issue of new
Rubicon ordinary shares to Lonrho.
Over the past five years, Lonrho has developed its regional
African scheduled aviation division, Fly540, into a significant
airline carrying 50,000 passengers a month and serving the East,
West and South-West of Africa from hubs in Kenya, Ghana and Angola
respectively. Fly540 was budgeted to achieve revenues of GBP70m in
2012, and operates the foremost private sector route network in
Africa.
Having completed the crucial establishment phase of the
airline's development, the Lonrho Board believed that it was
essential, for the further development of the airline, to bring
world class aviation expertise into the business and establish the
aviation division in its own separate corporate structure. As a
consequence, on 29 June 2012, Rubicon completed its acquisition of
the aviation division, with the enlarged share capital of Rubicon
beginning trading on AIM on 2 July 2012 and Rubicon subsequently
being renamed FastJet on 6 August 2012.
FastJet has subsequently raised GBP5.5m through an equity
fundraising in order to fund its growth and the deployment of
Airbus' A319's, which will be the standard aircraft for FastJet. As
stated at the time of completion of the transaction, Lonrho has now
completed its investment in the aviation sector and thus did not
take part in the FastJet fundraising. Lonrho's current holding in
FastJet is 67.4% and it is no longer involved in the day-to-day
management of the business, as FastJet implements its own
self-funded strategy for its development.
Sir Stelios Haji-Ioannou, the founder and major shareholder of
easyJet, the world's most successful low cost airline, and his
easyGroup have became a shareholder in FastJet and, following
significant due diligence of the market opportunity, Sir Stelios
has introduced a new world class management team to FastJet to
build it into the low cost airline for Africa.
The Lonrho Board, Sir Stelios and easyGroup believe that the
opportunity for a regional low cost carrier in the growing African
marketplace is significant, and that the unique combination of
- Lonrho's African expertise;
- the existing aviation operations established by Lonrho across the Continent;
- easyGroup and Sir Stelios' aviation experience and
- the new management team introduced by Sir Stelios to run the business moving forward
collectively provide a unique opportunity to rapidly build a
significant low cost airline connecting Africa.
FastJet is consolidated as a jointly controlled entity in
Lonrho's Group accounts. This has resulted in a one-off net gain
during the period in relation to the transfer of the aviation
division to joint control of GBP33.9m. The business impact relating
to the separation, listing and restructuring of Fly540 to become
FastJet, the inevitable slow down of development during the
transition and the introduction of the new management team and
shareholders in FastJet, when combined with the operations, have
resulted in a net operating loss of GBP8.8m in the aviation
division for Lonrho in the period. For the purposes of this
reporting period, the results for the six month period of the
Transportation division are separately disclosed from those of the
remaining four core operating divisions.
Operational Review
Lonrho is now focused on its four core divisions: Agribusiness,
Infrastructure, Hotels and Support Services, all of which reported
strong growth during the period.
Agribusiness
Revenues of GBP72.7 million, up 130%, Gross Margin up 0.7%
(compared with 6 months to 31 March 2011)
Agribusiness is now the largest of Lonrho's core divisions,
accounting for 71% of revenues, and has seen significant growth in
each of its operations: Fresh Produce (comprising Rollex, Fresh
Direct and Lonrho Logistics); Fish (comprising Oceanfresh and
Fish-on-Line) and Agricultural Equipment.
Lonrho believes that Africa, which holds 60% of the world's
arable land, is an essential component to meeting global expanding
food demand. Agriculture is a major contributor to Africa's
economies and, over the past four years, Lonrho has established a
unique vertically integrated agri-logistics delivery cold chain
that can reliably deliver fresh produce from Africa to market
providing continuity of quality and traceability. The Company
believes that this vertically integrated cold chain is of great
appeal to the world's food retailers.
The completion of the Group's vertically integrated cold chain
facilities has now resulted in Lonrho being able to deliver fresh
produce from across Southern Africa to a global market. This
business is building significant momentum with a blue chip client
base and Lonrho is seeing growth in demand from African, European,
Scandinavian, North American, and, increasingly, Far Eastern
supermarket chains.
The supply contract to Pick n' Pay for fresh strawberries has
had the volumes expanded and the term lengthened following the
success of the initial programme. It will now continue to operate
on a full time annual basis as opposed to the 9 month season
originally envisaged.
Unusual inclement weather has had a limited short-term effect on
a proportion of the Group's young peach plantations, which are now
amongst the largest on the Continent. At this young stage of their
development, the fruit on the peach trees can be more susceptible
to severe frost. As a result of a highly unusual cold spell, the
export quality peach forecast for the year has conservatively been
reduced by 25% from initial expectations for this year only. Lonrho
remains confident that the peach tree programme is on track and
that this will have no impact on their long-term prospects. The
existing plantations will mature into the largest in Africa over
the next three years, producing fruit as planned specifically to
meet the demand from Europe for the six weeks prior to Christmas
each year.
In the Fish business, there is continued strong demand for
Namibian and South Africa wild caught, sustainably sourced hake,
which is a white fish that is similar to cod. The profitable
contracts supplying to Costco and Walmart in the USA continue, and
new listings for the third quarter of 2012 include Sam's Club,
Sainsburys, and a range of initial orders into the Far East.
The crustacean market continues to see strong global demand and,
during the period, Lonrho has taken over the largest cold stores
and processing facility in the fishing port in Maputo, Mozambique.
This has positioned Lonrho as the leading exporter of lobsters,
langoustines and prawns from Mozambique to the global market.
Significant wins for the Fish business during the first half of
2012 include the upgrading of an Oceanfresh line being supplied to
Costco in the USA into a 'Kirkland Signature' brand line. As a
'Kirkland Signature' brand line the product will be distributed in
every Costco store worldwide and comes with a three year commitment
from Costco to support the product. Rollout of this line began in
June of this year and the Group hopes to add further 'Kirkland
Signature' brand lines to the range moving forward.
Within the Agricultural Equipment business, sales remain strong
and Lonrho increased John Deere's market share in all the countries
where the Group operates. On 17 January 2012, Lonrho completed the
purchase of LonAgro Tanzania for US$1.4 million (GBP0.9 million)
which has the exclusive distributorship for Tanzania. A new
distributor was also launched in South Sudan. These two newest
distributorships are seeing positive initial business, and the
established distributorships in Mozambique and Angola continue to
build customer allegiance and sales by ensuring the highest levels
of customer support, spare parts and maintenance, giving customers
confidence to buy and operate John Deere equipment.
Infrastructure
Revenues of GBP10.9 million, up 47%, Gross Margin up 3.9%
(compared with 6 months to 31 March 2011)
The oil services business delivers one of the strongest margins
within the Group and typically revenues are from large 'blue chip'
oil supply and service companies operating globally.
Luba Freeport has seen a very strong first half of 2012. This
has been driven by a combination of delayed drilling programmes
that were scheduled for 2011, but which only started in 2012, and
new exploration and production that has commenced in 2012. Recently
Ophir, a Luba client, announced a significant new gas find in
Equatorial Guinean waters. The Tonel-1 well has exceeded
pre-drilling expectations and the find represents a significant
step towards the commercial threshold volumes required for a second
Liquid Natural Gas train for Equatorial Guinea.
Lonrho is well advanced in concluding the structure with the
Ghanaian Government and private sector finance for a major oil
logistics terminal to be located in Ghana. The initial designs for
this project, in Atuabo, Western Ghana, include a 2,000 acre
development site, operating as a specific free trade zone for the
oil & gas industry. The site will also include a rig and ship
repair facility for serving the wider West African market, where
currently rigs need to be towed to either Las Palmas, Canary
Islands or Cape Town, South Africa for maintenance.
Further discussions with certain Governments are underway
regarding opportunities on the East coast of Africa to support the
rapidly expanding oil & gas sectors.
The e-Kwikbuild manufacturing plant in Cape Town has now been
fully commissioned and a new CEO for the business has been
recruited to enhance management capabilities and further grow the
business. The demand for prefabricated buildings continues to
expand as Africa's economies grow. Prefabricated buildings remain a
quick and simple solution for natural resource companies, offices,
accommodation, clinics and other uses, where days after arrival on
a site, no matter how remote, the buildings are installed and
operational.
In the first quarter of 2012, e-Kwikbuild won its largest ever
order for 418 school classrooms for the Eastern Cape in South
Africa, which will generate revenue of GBP10.2 million at healthy
margins.
An increasing focus for e-Kwikbuild is on attracting new export
opportunities from the private sector from outside South Africa.
This will reduce its reliance on South African Government tenders
for business, and the new sales drive for private sector orders has
seen initial deliveries to Mozambique, the Democratic Republic of
the Congo and Tanzania as export destinations for e-Kwikbuild
buildings.
Hotels
Revenues of GBP5.1 million up 21%, Gross Margin up 0.4%
(compared with 6 months to 31 March 2011)
The Hotels division continues to progress, winning a new hotel
management contract in Kinshasa, the capital of the Democratic
Republic of the Congo, and a new lease contract in Gaborone, the
capital of Botswana, further expanding the Lonrho Hotels' network
across the Continent.
The Grand Hotel in Kinshasa is the foremost hotel in the
Congolese capital and the Government is funding a total
refurbishment programme for the property to bring it back to its
original status as one of the leading hotels in Africa. The
property dominates the Kinshasa hotel market with 450 rooms. Lonrho
Hotels has taken over the management of the property with a mandate
to bring it back up to international standards.
The new Lonrho property in Gaborone is in the recently developed
Masa Square development, at the heart of the Central Business
District. Lonrho has opened the property as a 'Lansmore Hotel by
Lonrho', Lonrho Hotels' four / five-star brand. It is expected that
the property will become the hotel of choice for those visiting
Gaborone.
The first easyHotel by Lonrho is expected to open in the Central
Business District of Johannesburg by the end of the year and a
strong pipeline of potential easyHotel projects is in place.
Support Services
Revenues of GBP14.0 million up 79%, Gross Margin up 15.8%
(compared with 6 months to 31 March 2011)
The Support Services division is providing 'one-stop' camp and
logistics solutions through AFEX to a growing number of resource
companies and Government agencies, which are attracted by Lonrho's
ability to provide a comprehensive service under one ownership
structure.
AFEX continues to deliver strongly, with recent new contracts
awarded by Tullow Oil, Fluor and Africom. The camp operations in
Juba, South Sudan, are continuing to be popular with high occupancy
and yields.
Lonrho IT also continued to make strong progress in the period
with new contract wins from blue chip clients, including reporting
rapid growth in its newer markets such as Zambia and Zimbabwe.
Corporate
During the period Lonrho announced the appointment of Jefferies
Hoare Govett ("JHG") as broker to the Company. JHG brings a wider
exposure for the Company to institutional clients, and specifically
brings strong access to the US institutional market. Lonrho
believes there is growing interest in the USA in emerging Africa,
where there will be resonance with Lonrho's supply of African
produce into the USA to Walmart, Costco and other retailers, as
well as Lonrho's distribution of John Deere agricultural equipment
in Africa.
On 3 January 2012, Lonrho completed an equity raise of GBP26.9
million. The Company received valid acceptances in respect of
22,534,994 new ordinary shares from qualifying shareholders,
representing approximately 20.8 per cent of the new ordinary shares
offered under the Open Offer. A total of 269,498,795 shares were
issued at an issue price of 10 pence per new ordinary share.
In February 2012 the four Lonrho nominated Executive Directors
stepped down from the Board of LonZim Plc. Jean Ellis also stepped
down as a Non-Executive Director of LonZim. The decision was taken
based on the Lonrho Executive Directors' desire to focus on
Lonrho's core businesses, whilst allowing LonZim to grow under its
own dedicated management team. LonZim was subsequently renamed
Cambria Africa Plc. Lonrho remains as Cambria's largest shareholder
with a 22.92% stake as at 30 June 2012. As a result of these
changes Lonrho no longer accounts for Cambria as an associate
company but instead reports its holding as an investment on the
balance sheet.
Financial Performance
Lonrho's four core operating divisions (Agribusiness,
Infrastructure, Hotels and Support Services) have delivered solid
growth in performance in the first half of the year, recording
improvements in turnover and gross margin. Net operating profit
across these four divisions rose to GBP4.7m compared to GBP0.7m for
the 6 months to 31 March 2011.
The separation of Lonrho's aviation division into FastJet was
completed on 29 June 2012. Hence these interim accounts also
incorporate the trading of the aviation division from 1 January to
29 June 2012 (disclosed as the Transportation division). The
Transportation division made a net operating loss of GBP8.8m in the
first half of 2012 reflecting the ongoing start-up costs in Angola
and Ghana as well as a slow down in the deployment of new aircraft
and the restructuring prior to the transfer to FastJet.
With effect from 29 June 2012, the Group will account for
FastJet as a jointly controlled entity, reflecting the management
structure of the business whereby neither Lonrho nor easyGroup have
Board control over FastJet but jointly can appoint up to four
Directors. This means that the Group will report its share of the
results of FastJet in the income statement from 29 June 2012 as
share of jointly controlled entity and on the Consolidated
Statement of Financial Position as a single line item reflecting
the fair value of the Group's investment. As part of the
transaction, FastJet issued options to its Directors and easyGroup
which result in the calculation of a share-based payment charge in
the accounts of FastJet. Lonrho's share of this charge is GBP1.3m,
which is reported under share of results of jointly controlled
entities in the income statement.
The change to the accounting treatment of FastJet to become a
jointly controlled entity also creates a one-off non-cash gain of
GBP33.9m (net of transaction costs), representing the difference
between the value of the consideration payable to Lonrho pursuant
to the transaction of US$ 85.7 m (GBP55.1m) and the net asset value
of the aviation division at the date of transfer. This gain has
been disclosed separately on the consolidated statement of
financial position and is discussed further in Note 8 to these
interim accounts.
Divisional Performance
The results of the Group's operating divisions are set out in
Note 6 - Segmental reporting. In order to understand the impact of
the aviation division on the results for the interim period the
table below splits out a pro-forma income statement for the core of
the Lonrho Group.
Transportation
(including
discontinued 6 months to
Core divisions operation) 30 June 2012
GBPm GBPm GBPm
------------------------------------ --------------- --------------- --------------
Revenue 102.7 20.2 122.9
Cost of sales (74.7) (16.7) (91.4)
GROSS PROFIT 28.0 3.5 31.5
------------------------------------ --------------- --------------- --------------
Gain arising on fair valuation
of biological assets 3.7 - 3.7
Other operating income
- Gains on acquisitions - - -
- Other 0.7 - 0.7
Operating costs (26.0) (11.0) (37.0)
OPERATING PROFIT / (LOSS) 6.4 (7.5) (1.1)
------------------------------------ --------------- --------------- --------------
Finance income 3.8 0.1 3.9
Finance expense (7.0) (1.4) (8.4)
NET FINANCE EXPENSE (3.2) (1.3) (4.5)
------------------------------------ --------------- --------------- --------------
NET OPERATING PROFIT / (LOSS) 4.7 (8.3) (3.6)
Share based payments (0.8) - (0.8)
Amortisation (0.7) (0.5) (1.2)
------------------------------------ --------------- --------------- --------------
OPERATING PROFIT/ (LOSS)
AFTER FINANCING 3.2 (8.8) (5.6)
------------------------------------ --------------- --------------- --------------
Share of results of associates (3.1) - (3.1)
Share of results of jointly
controlled entity (1.3) - (1.3)
Gain on contribution of subsidiary
to jointly controlled entity 33.9 - 33.9
Loss on other investments (0.2) - (0.2)
PROFIT / (LOSS) BEFORE TAX 32.5 (8.8) 23.7
------------------------------------ --------------- --------------- --------------
Income tax charge (0.2) - (0.2)
PROFIT / (LOSS) FOR THE PERIOD 32.3 (8.8) 23.5
------------------------------------ --------------- --------------- --------------
In the second half of 2012 and in future financial years the
Group's consolidated income statement will reflect just the
financial performance of the core divisions in line with the
pro-forma above.
Net Indebtedness
The Group's net indebtedness has reduced to GBP78.7m as at 30
June 2012 from GBP102.7m at 31 December 2011. In part this is due
to the transfer of debt to FastJet (representing finance leases on
aircraft and working capital facilities), together with proceeds
from the January equity raise. The Group has continued to invest in
working capital to support growth, especially in the Agribusiness
division where Oceanfresh has geared up for the rollout of the
'Kirkland Signature' brand line with CostCo, which began in
June.
Associates/Investments
As mentioned above, the Group now accounts for its stake in
Cambria Africa Plc as an investment with effect from 24 February
2012. Consequently the investment has been marked-to-market as at
30 June 2012, which, together with Lonrho's share of losses before
the change from associate to investment, results in a write-down of
GBP3.3m.
Outlook
Following a very successful six months, and the separation of
the aviation division, the Company is in a solid position to
continue to deliver on its core businesses. The global economic
environment remains challenging and it is difficult to predict the
impact on some of the Group's export markets. However, the Group
has achieved a number of key milestones in the first half of the
year which the Board believes will help to deliver continued growth
in the second half, traditionally a stronger sales period for the
Group. The Board is confident that there is now a strong platform
in place across the Group's four core operating divisions from
which it can continue to successfully drive the profitability and
cash generation of each. It remains the Board's intention to
introduce a dividend policy that will be made public during 2012
for introduction during 2013.
Geoffrey White
Director and Chief Executive Officer
10 August 2012
Condensed consolidated interim income statement
Unaudited 6 months to 30 Unaudited 6 months to Audited 15 months to
June 2012 31 March 2011 31 December 2011
Continuing Discontinued Total Continuing Discontinued Total Continuing Discontinued Total
Operations Operations Operations Operations Operations Operations
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Note GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Revenue 122.9 - 122.9 61.1 - 61.1 188.4 0.2 188.6
Cost of sales (91.4) - (91.4) (46.4) - (46.4) (137.2) (0.7) (137.9)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
GROSS PROFIT/(LOSS) 31.5 - 31.5 14.7 - 14.7 51.2 (0.5) 50.7
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Gain arising on
fair valuation
of biological assets 3.7 - 3.7 4.9 - 4.9 27.4 - 27.4
Other operating
income
* Gain on acquisitions - - - - - - 15.8 - 15.8
* Other 0.7 - 0.7 1.6 - 1.6 2.2 - 2.2
Operating costs (36.9) (0.1) (37.0) (21.3) (0.2) (21.5) (80.4) (0.6) (81.0)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
OPERATING (LOSS)/PROFIT (1.0) (0.1) (1.1) (0.1) (0.2) (0.3) 16.2 (1.1) 15.1
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Finance income 10 3.9 - 3.9 1.5 - 1.5 6.8 - 6.8
Finance expense 10 (8.4) - (8.4) (4.3) - (4.3) (16.2) - (16.2)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
NET FINANCE EXPENSE 10 (4.5) - (4.5) (2.8) - (2.8) (9.4) - (9.4)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
NET OPERATING (LOSS)/
PROFIT (3.5) (0.1) (3.6) (2.5) (0.2) (2.7) 9.6 (1.1) 8.5
Share based payments (0.8) - (0.8) - - - (0.7) - (0.7)
Amortisation (1.2) - (1.2) (0.4) - (0.4) (2.1) - (2.1)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
OPERATING (LOSS)/PROFIT
AFTER FINANCING (5.5) (0.1) (5.6) (2.9) (0.2) (3.1) 6.8 (1.1) 5.7
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Share of results
of associates (3.1) - (3.1) 0.2 - 0.2 (5.9) - (5.9)
Share of results
of jointly controlled
entity 11 (1.3) - (1.3) - - - - - -
Gain on contribution
of subsidiary to
jointly controlled
entity 8 33.9 - 33.9 - - - - - -
(Loss)/Gain on
other investments (0.2) - (0.2) - - - 1.0 - 1.0
PROFIT / (LOSS)
BEFORE TAX 23.8 (0.1) 23.7 (2.7) (0.2) (2.9) 1.9 (1.1) 0.8
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Income tax charge (0.2) - (0.2) (0.4) - (0.4) (0.3) - (0.3)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
PROFIT/(LOSS) FOR
THE PERIOD 23.6 (0.1) 23.5 (3.1) (0.2) (3.3) 1.6 (1.1) 0.5
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
ATTRIBUTABLE TO:
Owners of the Company 25.8 (0.1) 25.7 (1.0) (0.2) (1.2) 7.1 (1.1) 6.0
Non-controlling
interests (2.2) - (2.2) (2.1) - (2.1) (5.5) - (5.5)
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
PROFIT/(LOSS) FOR
THE PERIOD 23.6 (0.1) 23.5 (3.1) (0.2) (3.3) 1.6 (1.1) 0.5
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
EARNINGS/ (LOSS)
PER SHARE:
Basic earnings/(loss)
per share (pence) 1.65 (0.1) 1.64 (0.8) (0.2) (0.10) 0.58 (0.09) 0.49
Diluted earnings/(loss)
per share (pence) 1.64 (0.1) 1.63 (0.8) (0.2) (0.10) 0.57 (0.09) 0.48
---------------------------- ----- ----------- ------------- ------- ----------- ------------- ------- ----------- ------------- --------
Condensed consolidated interim statement of
comprehensive income
Unaudited Unaudited Audited
6 months to 6 months to 15 months to
30 June 31 March 31 December
2012 2011 2011
GBPm GBPm GBPm
---------------------------------------------- ------------ ------------ -------------
Foreign exchange translation differences (2.9) 0.8 (0.2)
Revaluation of property, plant and equipment - - 7.2
---------------------------------------------- ------------ ------------ -------------
Total other comprehensive income and expense (2.9) 0.8 7.0
Profit /(Loss) for the period 23.5 (3.3) 0.5
---------------------------------------------- ------------ ------------ -------------
Total comprehensive income and expense 20.6 (2.5) 7.5
---------------------------------------------- ------------ ------------ -------------
ATTRIBUTABLE TO:
Owners of the Company 22.8 (1.1) 9.7
Non-controlling interests (2.2) (1.4) (2.2)
---------------------------------------------- ------------ ------------ -------------
Total comprehensive income and expense 20.6 (2.5) 7.5
---------------------------------------------- ------------ ------------ -------------
Condensed consolidated statement of changes in equity
Unaudited 6 months to 30 Unaudited 6 months to Audited 15 months to 31 December
June 2012 31 March 2011 2011
Owners Owners Owners
of the Non-Controlling of the Non-Controlling of the Non-Controlling
Company interests Total Company interests Total Company interests Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
At beginning of
period 135.2 20.5 155.7 107.4 20.3 127.7 107.4 20.3 127.7
----------------- -------- ---------------- ------ -------- ---------------- ------ -------- ---------------- ------
Profit/ (Loss)
for
the period 25.7 (2.2) 23.5 (1.2) (2.1) (3.3) 6.0 (5.5) 0.5
Foreign exchange
translation
differences (2.8) (0.1) (2.9) 0.1 0.7 0.8 (0.5) 0.3 (0.2)
Revaluation of
property,
plant and
equipment - - - - - - 4.2 3.0 7.2
----------------- -------- ---------------- ------ -------- ---------------- ------ -------- ---------------- ------
Total
comprehensive
income and
expense 22.9 (2.3) 20.6 (1.1) (1.4) (2.5) 9.7 (2.2) 7.5
Issue of shares 25.5 - 25.5 0.3 - 0.3 18.9 - 18.9
Share based
payment
charge 0.8 - 0.8 - - - 0.7 - 0.7
Costs associated
with
share issues (1.1) - (1.1) - - - (0.4) - (0.4)
Share options
exercised 0.3 - 0.3 - - - 0.7 - 0.7
Subsidiaries
acquired - - - - - - - 2.2 2.2
Subsidiaries
disposed - - - - (0.1) (0.1) - (0.2) (0.2)
Non-controlling
interest
dividends - - - - - - - (0.2) (0.2)
Transfer from
non-controlling
interest - 8.0 8.0 - - - - - -
Non-controlling
interest
put option - - - - - - (2.3) - (2.3)
Capital element
of
convertible
bond - - - 1.0 - 1.0 1.1 - 1.1
Elimination of
non-controlling
interest - - - - - - (0.6) 0.6 -
----------------- -------- ---------------- ------ -------- ---------------- ------ -------- ---------------- ------
At end of period 183.6 26.2 209.8 107.6 18.8 126.4 135.2 20.5 155.7
----------------- -------- ---------------- ------ -------- ---------------- ------ -------- ---------------- ------
Condensed consolidated interim statement of
financial position
Unaudited Unaudited Audited
30 June 31 March 31 December
2012 2011 2011
Note GBPm GBPm GBPm
------------------------------------- ----- ---------- ---------- ------------
ASSETS
Goodwill 17.6 15.8 17.8
Other intangible assets 19.9 5.6 21.9
Property, plant and equipment 136.7 124.0 166.2
Biological assets 36.5 15.0 33.8
Investments in associates and joint
ventures 11 1.2 12.9 6.9
Investment in jointly controlled
entity 11 54.3 - -
Other investments 11 3.5 0.2 1.7
Deferred tax 2.1 0.7 1.8
------------------------------------- ----- ---------- ---------- ------------
TOTAL NON-CURRENT ASSETS 271.8 174.2 250.1
------------------------------------- ----- ---------- ---------- ------------
Inventories 21.5 6.7 20.1
Trade and other receivables 46.7 45.8 48.8
Cash and cash equivalents 12.5 23.9 12.7
------------------------------------- ----- ---------- ---------- ------------
TOTAL CURRENT ASSETS 80.7 76.4 81.6
------------------------------------- ----- ---------- ---------- ------------
TOTAL ASSETS 352.5 250.6 331.7
------------------------------------- ----- ---------- ---------- ------------
EQUITY
Share capital 17 15.7 11.8 13.0
Share premium 17 136.2 138.4 138.2
Revaluation reserve 17 9.1 3.9 9.1
Share option reserve 17 7.3 4.6 5.4
Translation reserve 17 (13.1) (9.2) (10.4)
Other reserves 17 33.9 (4.5) 11.0
Retained earnings 17 (5.5) (37.4) (31.1)
------------------------------------- ----- ---------- ---------- ------------
TOTAL EQUITY ATTRIBUTABLE TO EQUITY
HOLDERS OF THE COMPANY 183.6 107.6 135.2
------------------------------------- ----- ---------- ---------- ------------
NON-CONTROLLING INTERESTS 26.2 18.8 20.5
------------------------------------- ----- ---------- ---------- ------------
TOTAL EQUITY 209.8 126.4 155.7
------------------------------------- ----- ---------- ---------- ------------
LIABILITIES
Loans and borrowings 9 74.2 63.0 76.7
Deferred tax 3.8 3.0 4.1
Obligations under finance leases 9 0.9 10.8 18.6
Provisions 1.5 - -
Trade and other payables 10.6 3.3 16.1
TOTAL NON-CURRENT LIABILITIES 91.0 80.1 115.5
------------------------------------- ----- ---------- ---------- ------------
Bank overdraft 9 4.7 4.7 12.2
Loans and borrowings 9 10.4 3.9 3.0
Obligations under finance leases 9 1.1 0.9 4.9
Trade and other payables 34.7 34.3 39.7
Tax liability 0.8 0.3 0.7
------------------------------------- ----- ---------- ---------- ------------
TOTAL CURRENT LIABILITIES 51.7 44.1 60.5
------------------------------------- ----- ---------- ---------- ------------
TOTAL LIABILITIES 142.7 124.2 176.0
------------------------------------- ----- ---------- ---------- ------------
TOTAL EQUITY AND LIABILITIES 352.5 250.6 331.7
------------------------------------- ----- ---------- ---------- ------------
Condensed consolidated interim cash flow statement
Unaudited Unaudited Audited
6 months to 6 months to 15 months to
30 June 31 March 31 December
2012 2011 2011
Note GBPm GBPm GBPm
--------------------------------------- ----- ------------ ------------ -------------
CASH FLOWS FROM OPERATING ACTIVITIES
Profit/(loss) for the period 23.5 (3.3) 0.5
Adjustments 13 (19.9) 1.8 (16.4)
--------------------------------------- ----- ------------ ------------ -------------
CASH FLOWS FROM OPERATING ACTIVITIES
BEFORE MOVEMENTS IN WORKING
CAPITAL 3.6 (1.5) (15.9)
Change in inventories (5.2) (1.5) (14.3)
Change in trade and other receivables (11.5) (12.3) (17.3)
Change in trade and other payables 4.1 2.9 13.3
--------------------------------------- ----- ------------ ------------ -------------
CASH GENERATED FROM OPERATIONS (9.0) (12.4) (34.2)
Interest received 0.1 - 0.8
Interest paid (4.5) (2.8) (8.1)
Interest element of finance
lease rental payments (0.2) - (0.5)
Income tax paid (0.3) (0.6) (1.2)
--------------------------------------- ----- ------------ ------------ -------------
NET CASH FROM OPERATING ACTIVITIES (13.9) (15.8) (43.2)
--------------------------------------- ----- ------------ ------------ -------------
CASH FLOWS FROM INVESTING ACTIVITIES
Proceeds from sale of property,
plant and equipment 1.4 - 2.2
Movement in restricted cash 1.5 - (3.2)
Acquisition of subsidiary,
net of cash acquired (0.9) (1.3) (6.1)
Acquisition of property, plant
and equipment (4.6) (13.6) (18.4)
Acquisition of intangible assets - - (5.1)
Acquisition of associates and
joint ventures - (1.2) (1.2)
Proceeds from sale of subsidiary
undertaking - - 0.7
--------------------------------------- ----- ------------ ------------ -------------
NET CASH FROM INVESTING ACTIVITIES (2.6) (16.1) (31.1)
--------------------------------------- ----- ------------ ------------ -------------
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from the issue of
share capital 25.5 0.3 18.9
Proceeds from the exercise
of share options 0.1 - 0.7
Loan advance 11.4 49.5 61.1
Repayment of borrowings (8.5) (1.3) (10.6)
Payment of finance lease liabilities (2.9) (1.4) (3.7)
Non-controlling interest dividends
paid - - 0.2
--------------------------------------- ----- ------------ ------------ -------------
NET CASH FROM FINANCING ACTIVITIES 25.6 47.1 66.6
--------------------------------------- ----- ------------ ------------ -------------
Net increase/(decrease) in
cash and cash equivalents 9.1 15.2 (7.7)
Cash and cash equivalents at
start of period (2.7) 3.9 3.9
Foreign exchange movements (0.3) 0.1 1.1
--------------------------------------- ----- ------------ ------------ -------------
CASH AND CASH EQUIVALENTS AT
END OF THE PERIOD 6.1 19.2 (2.7)
--------------------------------------- ----- ------------ ------------ -------------
Included in cash and cash equivalents of GBP12.5m, as prescribed
in the statement of financial position, is GBP1.7m subject to
restrictions of use, which means it is not freely available.
Notes:
Note of preparation
1. Reporting Entity
Lonrho Plc (the "Company") is a company incorporated and
domiciled in the United Kingdom.
The financial statements included in this half yearly report
were authorised for issue by the Directors on 10(th) August
2012.
2. Basis of preparation
Statement of compliance
The annual financial statements of the Group are prepared in
accordance with IFRSs as adopted by the EU. The condensed set of
financial statements included in this half yearly report has been
prepared in accordance with IAS34 and the recognition and
measurement requirements of IFRSs as adopted by the EU.
The financial information is unaudited, and has not been
reviewed by the Company's auditors, and does not constitute the
Company's statutory accounts within the meaning of Section 434 of
the Companies Act 2006.
The comparative figures for the fifteen month period ended 31
December 2011 are not the Company's statutory accounts for that
financial year. Those accounts have been reported on by the
Company's auditors and delivered to the Registrar of Companies. The
report of the auditors was (i) unqualified, (ii) did not include a
reference to any matters to which the auditors drew attention by
way of emphasis without qualifying their report, and (iii) did not
contain a statement under section 498 (2) or (3) of the Companies
Act 2006. Due to the change in the Company's year end to 31
December comparatives for the six months to 30 June 2011 are not
available. The Directors have accordingly included comparative
information for the six months ended 31 March 2011 and the 15
months ended 31 December 2011. The Directors do not consider that
there are material seasonal variances that impact the comparison of
the two six month periods presented.
Going Concern
Although the current ongoing economic conditions create
uncertainty, the Group's forecasts and projections, taking account
of reasonably possible changes in trading performance, together
with mitigation actions that are within management's control, show
that the Group is expected to be able to operate within the level
and covenant conditions of its debt facilities. As such, these
interim financial statements are prepared on the going concern
basis. There have been no significant changes in estimates in the
current period.
3. Significant accounting policies
The accounting policies applied by the Group in these condensed
consolidated interim financial statements are substantially the
same as those applied by the Group in its consolidated financial
statements for the six months to 30 June 2012. Whilst there have
been changes to standards which become applicable for the period
ended 30 June 2012, none have been assessed as having a significant
impact on the Group.
(a) Basis of consolidation
The consolidated financial statements incorporate the financial
statements of Lonrho Plc, its subsidiaries, associates and jointly
controlled entities.
Subsidiaries
Subsidiaries are entities controlled by Lonrho Plc. Control is
achieved where Lonrho Plc (the Company) has the power to govern the
financial and operating policies of an investee entity so as to
obtain benefits from its activities.
The portion of a non-controlling interest is stated as the
non-controlling interest's proportion of the fair values of the
assets and liabilities recognised. Subsequently, losses applicable
to the non-controlling interest in excess of the non-controlling
interest in the subsidiary's equity are allocated against the
interests of the Group except to the extent that the
non-controlling interest has a binding obligation and is able to
make an additional investment to cover the losses. Future profits
attributable to the non-controlling interest are not recognised
until the unrecognised losses have been extinguished.
The results of entities acquired or disposed of during the
period are included in the consolidated income statement from the
effective date of acquisition or up to the effective date of
disposal, as appropriate. Negative goodwill recognised on
acquisition is recognised in the income statement at the effective
date of acquisition.
Investments in associates and jointly controlled entities
Associates are those entities in which the Group has significant
influence but not control over the financial and operating
policies. Significant influence is presumed to exist when the Group
holds between 20% and 50% of the voting power of another entity.
Jointly controlled entities are those entities over whose
activities the Group has joint control together with other parties,
established by contractual agreement and requiring joint consent
for strategic financial and operating decisions. Investments in
associates and jointly controlled entities are accounted for using
the equity method. The consolidated financial statements include
the Group's share of the profit or loss and other comprehensive
income of the equity accounted investees, after adjustments to
align the accounting policies with those of the Group, from the
date that significant influence or joint control commences until
the date that significant influence or joint control ceases.
(b) Non-GAAP measures
Following a review of key performance indicators used by the
directors and consultations with key stakeholders, the Directors
have revised the key non-GAAP profit measure used to monitor
performance of the business. From 1st January 2012 the key non-GAAP
profit measure used by the board is Net operating profit which is
defined as Operating profit before amortisation of acquired
intangible assets and share based payment charges less net finance
charges. The Directors believe that this measure best reflects the
trading performance of the group.
4. Earnings per share
Basic earnings per share are calculated based on the weighted
average number of ordinary shares outstanding during the period.
Diluted loss per share is based upon the weighted average number of
shares in issue throughout the year, adjusted for the dilutive
effect of potential ordinary shares. The potential dilutive
ordinary shares in issue are employee share options and the equity
conversion element of the convertible bond.
5. Capital management
Given the current global financial crisis, the Directors are
carefully monitoring cash resources within the Group and have
instigated a number of initiatives to ensure funding will be
available for planned projects. In January 2012 Lonrho announced a
placing of new ordinary shares in the capital of the Company at 10
pence per share to raise gross proceeds of GBP26.9m.
6. Segmental reporting
The Chief Operating Decision Maker is deemed to be the Executive
Committee, which monitors the results of the business segments to
assess performance and make decisions about the allocation of
revenues. Segment performance is evaluated on both revenue and
operating profit/ (loss).
Segment results, assets and liabilities include items directly
attributable to a segment as well as those that can be allocated on
a reasonable basis. Unallocated items comprise mainly interest
corporate assets and expenses.
Segment capital expenditure is the total cost incurred during
the period to acquire segment assets that are expected to be used
for more than one period.
There is no inter-segment revenue.
Business Segments
The Group has four ongoing reportable segments which are
organised around the basis of products and services which they
provide:
-- Agribusiness
-- Infrastructure
-- Support services
-- Hotels
The Group has not aggregated any operating segment in arriving
at this analysis.
From the 29(th) June 2012, Transportation is no longer
considered a reportable segment as it was transferred to a jointly
controlled entity and is consolidated as such using the equity
method. Accordingly, for the purposes of clarity, segmental
information is provided including sub-totals of the four ongoing
reportable segments as well as the detail required under IFRS8,
Segmental Reporting.
6.Segmental reporting (continued)
Unaudited 6 months to 30 June 2012
Core Continuing Dis-continued Total
Support Operating operations operations
Agri-business Infra-structure Services Hotels Other divisions Trans-portation
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
EXTERNAL
REVENUE 72.7 10.9 14.0 5.1 - 102.7 20.2 122.9 - 122.9
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment result 6.3 0.5 1.3 (0.3) (3.1) 4.7 (8.2) (3.5) (0.1) (3.6)
Amortisation (0.7) - - - - (0.7) (0.5) (1.2) - (1.2)
Share based
payments
expense - - - - (0.8) (0.8) - (0.8) - (0.8)
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
OPERATING
(LOSS)/PROFIT
AFTER
FINANCING 5.6 0.5 1.3 (0.3) (3.9) 3.2 (8.7) (5.5) (0.1) (5.6)
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Share of
results
of associates - - - - (3.1) (3.1) - (3.1) - (3.1)
Share of
results
of jointly
controlled
entity (1.3) (1.3) - (1.3) - (1.3)
Gain on
contribution
of subsidiary
to jointly
controlled
entity - - - - 33.9 33.9 - 33.9 - 33.9
Share of
results
of other
investments - - - - (0.2) (0.2) - (0.2) - (0.2)
Income tax
charge - - - - (0.2) (0.2) - (0.2) - (0.2)
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
PROFIT/(LOSS)
FOR THE
PERIOD 5.6 0.5 1.3 (0.3) 25.2 32.3 (8.7) 23.6 (0.1) 23.5
--------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Net finance
income/
(expense) (1.0) (0.3) 0.1 (0.4) (1.6) (3.2) (1.3) (4.5) - (4.5)
Unaudited 6 months to 31 March 2011
Core
Support Operating Continuing Dis-continued
Agri-business Infra-structure Services Hotels Other divisions Trans-portation operations operations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
EXTERNAL REVENUE 31.6 7.4 7.8 4.2 - 51.0 10.1 61.1 - 61.1
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Segment result 7.4 (1.7) 0.5 (0.4) (5.1) 0.7 (3.2) (2.5) (0.2) (2.7)
Amortisation (0.4) - - - - (0.4) - (0.4) - (0.4)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
OPERATING (LOSS)/PROFIT
AFTER FINANCING 7.0 (1.7) 0.5 (0.4) (5.1) 0.3 (3.2) (2.9) (0.2) (3.1)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Share of results
of associates - - - - 0.2 0.2 - 0.2 - 0.2
Income tax charge - - - - (0.4) (0.4) - (0.4) - (0.4)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
PROFIT/(LOSS)
FOR THE PERIOD 7.0 (1.7) 0.5 (0.4) (5.3) 0.1 (3.2) (3.1) (0.2) (3.3)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Net finance
income/ (expense) - (0.8) 0.1 (0.2) (1.2) (2.1) (0.6) (2.7) - (2.7)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Audited 15 months to 31 December 2011
Core Continuing
Support Operating operations Dis-continued
Agri-business Infra-structure Services Hotels Other divisions Trans-portation operations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
EXTERNAL REVENUE 94.5 21.8 25.1 11.5 - 152.9 35.5 188.4 0.2 188.6
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Segment result 33.1 - 1.4 3.1 (16.9) 20.7 (11.1) 9.6 (1.1) 8.5
Amortisation (1.0) (0.1) (0.4) - - (1.5) (0.6) (2.1) - (2.1)
Share based
payments expense - - - - (0.7) (0.7) - (0.7) - (0.7)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
OPERATING (LOSS)/PROFIT
AFTER FINANCING 32.1 (0.1) 1.0 3.1 (17.6) 18.5 (11.7) 6.8 (1.1) 5.7
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Share of results
of associates - - - - (5.9) (5.9) - (5.9) - (5.9)
Share of results
of other investments - - - - 1.0 1.0 - 1.0 - 1.0
Income tax charge - - - - (0.3) (0.3) - (0.3) - (0.3)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
PROFIT/(LOSS)
FOR THE PERIOD 32.1 (0.1) 1.0 3.1 (22.8) 13.3 (11.7) 1.6 (1.1) (0.5)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Net finance
income/(expense) (2.9) (0.8) 0.8 (0.2) (4.5) (7.6) (1.8) (9.4) - (9.4)
------------------------ ---------------- ------------------ ----------- --------- --------- ------------ ------------------ ----------- -------------- ------------------------
Unaudited 30 June 2012
Core
Support Operating Continuing Dis-continued
Agri-business Infra-structure Services Hotels Other divisions Trans-portation operations operations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
assets 128.5 83.1 14.9 51.3 - 277.8 - 277.8 0.2 278.0
Investment in
associates - - - - 1.2 1.2 - 1.2 - 1.2
Other investments - - - - 3.5 3.5 - 3.5 - 3.5
Investment in jointly
controlled entities - - - - - - 54.3 54.3 - 54.3
Unallocated
assets/interest
bearing assets - - - - 15.5 15.5 - 15.5 - 15.5
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL ASSETS 128.5 83.1 14.9 51.3 20.2 298.0 54.3 352.3 0.2 352.5
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
liabilities 50.6 14.3 9.1 15.8 - 89.8 - 89.8 0.1 89.9
Unallocated
liabilities/interest
bearing liabilities - - - - 52.8 52.8 - 52.8 - 52.8
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL LIABILITIES 50.6 14.3 9.1 15.8 52.8 142.6 - 142.6 0.1 142.7
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Depreciation of
segment
assets 1.3 1.7 0.3 0.7 0.1 4.2 - 4.2 - 5.3
Capital expenditure 4.2 0.4 0.2 0.4 0.1 5.2 - 5.2 - 5.5
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Unaudited 31 March 2011
Core
Support Operating Continuing Dis-continued
Agri-business Infra-structure Services Hotels Other divisions Trans-portation operations operations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
assets 58.8 83.4 12.5 25.0 - 179.7 33.2 212.9 0.3 213.2
Investment in
associates - - - - 12.9 12.9 - 12.9 - 12.9
Other investments - - - - 0.2 0.2 - 0.2 - 0.2
Unallocated
assets/interest
bearing assets - - - - 24.3 24.3 - 24.3 - 24.3
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL ASSETS 58.8 83.4 12.5 25.0 37.4 217.1 33.2 250.3 0.3 250.6
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
liabilities 22.2 15.2 6.8 11.0 - 55.2 18.8 74.0 0.5 74.5
Unallocated
liabilities/interest
bearing liabilities - - - - 49.7 49.7 - 49.7 - 49.7
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL LIABILITIES 22.2 15.2 6.8 11.0 49.7 104.9 18.8 123.7 0.5 124.2
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Depreciation of
segment
assets 0.7 1.6 0.2 0.6 0.1 3.1 0.2 3.3 - 3.3
Capital expenditure 1.2 0.9 0.2 0.3 - 2.6 13.5 16.1 - 16.1
Audited 31 December 2011
Core Continuing
Support Operating operations Dis-continued
Agri-business Infra-structure Services Hotels Other divisions Trans-portation operations Total
GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
assets 112.2 82.1 15.3 46.4 - 256.0 53.0 309.0 0.3 309.3
Investment in
associates - - - - 6.9 6.9 - 6.9 - 6.9
Other investments - - - - 1.7 1.7 - 1.7 1.7
Unallocated
assets/interest
bearing assets - - - - 13.8 13.8 - 13.8 - 13.8
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL ASSETS 112.2 82.1 15.3 46.4 22.4 278.4 53.0 331.4 0.3 331.7
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Segment operating
liabilities 47.1 13.2 9.0 16.9 86.2 39.5 125.7 0.1 125.8
Unallocated
liabilities/interest
bearing liabilities - - - - 50.2 50.2 - 50.2 - 50.2
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
TOTAL LIABILITIES 47.1 13.2 9.0 16.9 50.2 136.4 39.5 175.9 0.1 176.0
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
Depreciation of
segment
assets 2.3 4.1 0.6 1.5 0.2 8.7 1.2 9.9 - 9.9
Capital expenditure 6.4 4.7 0.8 0.5 0.1 12.5 30.9 43.4 - 43.4
---------------------- -------------- ---------------- --------- ------- ------ ---------- ---------------- ----------- -------------- ------
7. Acquisition of subsidiaries
With effect from 17 January 2012, the Group acquired 100% of the
issued share capital of LonAgro Tanzania Limited for a
consideration of US$1.4 million (GBP0.9 million). Lonagro Tanzania
is based in Dar es Salaam, the commercial hub of Tanzania, and has
the exclusive John Deere distributorship for Tanzania.
The transaction has been accounted for by the purchase method of
accounting. The fair value of the net assets at 17(th) January 2012
is set out below:
Pre-acquisition Fair value adjustment Values recognised
carrying value on acquisition on acquisition
GBPm GBPm GBPm
Inventory 0.1 - 0.1
Intangible related to franchise - 0.8 0.8
--------------------------------- ---------------- ---------------------- ------------------
NET IDENTIFIABLE ASSETS AND
LIABILITIES 0.1 0.8 0.9
--------------------------------- ---------------- ---------------------- ------------------
Consideration paid - - 0.9
GOODWILL ON ACQUISITION - - -
--------------------------------- ---------------- ---------------------- ------------------
8. Transfer of subsidiary to jointly controlled entity
On the 29 June 2012 Lonrho Plc transferred its Transportation
division headed by Lonrho Aviation BVI to a jointly controlled
entity Rubicon Diversified Investments Plc ('Rubicon'), renamed
FastJet Plc on the 6 August 2011, with a market value of GBP55.6m
represented by 1,160,037,455 ordinary shares in Rubicon at 4.8p per
share resulting in a 73.6% equity interest in Rubicon immediately
post the transaction. Due to the terms of the articles of
association, shareholder agreements in place and board constitution
the Directors do not consider that Lonrho has control of Rubicon.
The Directors consider that, due to the composition of the board of
directors of Rubicon, Lonrho controls this entity jointly with
easyGroup and as such the Group's interest in Rubicon is
consolidated as a jointly controlled entity. In accordance with
IFRS3 (2008) the interest in Rubicon is recognised at its fair
value and the resulting gain is recognised in the income statement.
The assets and liabilities transferred to Rubicon and gain at the
29 June 2012 are set out in the table below:
29 June 2012
GBPm
-------------------------------------------------------- -------------
ASSETS
Goodwill 0.1
Other intangible assets 3.5
Property, plant and equipment 30.7
Inventories 2.8
Trade and other receivables 11.7
TOTAL ASSETS 48.8
-------------------------------------------------------- -------------
LIABILITIES
Loans and borrowings (1.1)
Deferred tax (0.2)
Obligations under finance leases (19.3)
Trade and other payables (15.3)
Bank overdraft (Net) (3.4)
-------------------------------------------------------- -------------
TOTAL LIABILITIES (39.3)
-------------------------------------------------------- -------------
NET ASSETS 9.5
-------------------------------------------------------- -------------
Fair value of jointly controlled entity 55.6
Net assets (9.5)
Non controlling interests (8.0)
-------------------------------------------------------- -------------
Gain on contribution of subsidiary to jointly
controlled entity 38.1
Liabilities retained (1.5)
Costs relating to transaction (2.7)
-------------------------------------------------------- -------------
Gain on contribution of subsidiary to jointly
controlled entity after costs relating to transaction 33.9
-------------------------------------------------------- -------------
9. Interest bearing loans and borrowings
This note provides information about the contractual terms of
the Group's interest-bearing loans and borrowings.
Unaudited Unaudited Audited
6 months to 6 months to 15 months to
30 June 31 March 31 December
2012 2011 2011
GBPm GBPm GBPm
---------------------------- ------------ ------------ -------------
NON-CURRENT LIABILITIES
Finance lease liabilities 0.9 10.8 18.6
Unsecured bank loans 27.0 17.4 27.9
Convertible bond 43.9 42.6 44.4
Shareholder loans 3.1 3.0 3.6
Other loans 0.2 - 0.8
---------------------------- ------------ ------------ -------------
75.1 73.8 95.3
---------------------------- ------------ ------------ -------------
CURRENT LIABILITIES
Unsecured bank loans 2.5 3.9 2.9
Secured bank loans 7.1 - -
Current portion of finance
lease liabilities 1.1 0.9 4.9
Other loans 0.8 - 0.1
Bank overdraft 4.7 4.7 12.2
---------------------------- ------------ ------------ -------------
16.2 9.5 20.1
---------------------------- ------------ ------------ -------------
10. Net finance expense
Unaudited Unaudited Unaudited
6 months 6 months to 15 months to
to
30 June 31 March 31 December
2012 2011 2011
GBPm GBPm GBPm
------------------------------------ ---------- ------------ -------------
Bank interest receivable 0.1 - 0.8
Foreign exchange gain 3.8 1.5 6.0
------------------------------------ ---------- ------------ -------------
FINANCE INCOME 3.9 1.5 6.8
------------------------------------ ---------- ------------ -------------
Interest on loans repayable within
five years and overdrafts (4.5) (2.6) (8.6)
Foreign exchange loss (3.7) (1.6) (7.1)
Interest on finance leases (0.2) (0.1) (0.5)
------------------------------------ ---------- ------------ -------------
FINANCE EXPENSE (8.4) (4.3) (16.2)
------------------------------------ ---------- ------------ -------------
NET FINANCE EXPENSE (4.5) (2.8) (9.4)
------------------------------------ ---------- ------------ -------------
11. Investments in associates, jointly controlled entities and
other investments
Investment in associates
Unaudited Audited
6 months Unaudited 15 months to
to 6 months to 31 December
30 June 2012 31 March 2011 2011
GBPm GBPm GBPm
---------------------------------------- -------------- --------------- --------------
At the beginning of the period 6.9 10.3 10.3
Additions to associates - 2.5 2.5
Share of loss after taxation - - (1.6)
Provisions in the period (3.5) - (4.3)
Reversal of provisions in the period 0.1
Disposal of associate (0.1)
Revaluation of associate 0.3 - -
Transfer from associate to investments (2.4) - -
---------------------------------------- -------------- --------------- --------------
At the end of the period 1.2 12.9 6.9
---------------------------------------- -------------- --------------- --------------
Other Investments
Unaudited Audited
6 months Unaudited 15 months to
to 6 months to 31 December
30 June 2012 31 March 2011 2011
GBPm GBPm GBPm
---------------------------------------- -------------- --------------- --------------
At the beginning of the period 1.7 0.6 0.6
Additions - - 0.1
Revaluation of investment (0.2) - 1.4
Impairment charge - (0.4) (0.4)
Transfer from associate to investments 2.4 - -
Transfer from other investments
to jointly controlled entity (0.4) - -
---------------------------------------- -------------- --------------- --------------
At the end of the period 3.5 0.2 1.7
---------------------------------------- -------------- --------------- --------------
Investment in jointly controlled entities
Unaudited Audited
6 months Unaudited 15 months to
to 6 months to 31 December
30 June 2012 31 March 2011 2011
GBPm GBPm GBPm
-------------- --------------- --------------
At the beginning of the period -
Transfer from subsidiary (Note 8) 55.6 - -
Share of loss for the period (1.3) - -
---------------------------------- ------
Investment in jointly controlled
entities 54.3 - -
---------------------------------- ------
12. Share based payments
In accordance with IFRS 2 'Share-based payments' share options
granted during the period have been measured at fair value at the
date of grant with the fair spread over the vesting period. The
fair value of the options granted has been estimated at the date of
grant using the Black-Scholes option-pricing model.
13. Note to the cash flow statement
Unaudited Unaudited Audited
6 months to 6 months 15 months
30 June to to
31 March 31 December
2012 2011 2011
GBPm GBPm GBPm
---------------------------------------------- ------------ ---------- -------------
Depreciation of property, plant and
equipment 5.3 3.3 9.9
Amortisation of intangible assets 1.2 0.4 2.1
(Loss)/ Gains on investments 0.2 - (1.0)
Foreign exchange (gain)/ loss (0.1) - 1.1
Share based payment expense 0.8 - 0.7
Finance income (0.1) 2.8 (0.8)
Finance expense 4.7 - 9.1
Profit on disposal of subsidiary - - (0.5)
Share of results of associates and
other investments 3.2 (0.2) 5.9
Gain arising on fair valuation of biological
assets (3.7) (4.9) (27.4)
Gain on acquisition - - (15.8)
Gain on contribution of subsidiary (33.9) - -
to jointly controlled entity
Share of results of joint controlled - -
entities 1.3
Loss on sale of property, plant and 1.0 - -
equipment
Income tax expense 0.2 0.4 0.3
---------------------------------------------- ------------ ---------- -------------
ADJUSTMENTS TO PROFIT FOR THE PERIOD (19.9) 1.8 (16.4)
---------------------------------------------- ------------ ---------- -------------
14. Related party transactions
Transactions between the Company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not
disclosed in this note.
Full details of the Group's other related party transactions and
balances are given in the Group's financial statement for the
period ended 31 December 2011. The only material change in these
relationships since 1 January 2012 is Lonrho's relationship with
LonZim Plc. LonZim Plc changed its name to Cambria Africa Plc and
Lonrho no longer has any board representation. Cambria Africa Plc
is now treated as an investment rather than an associate.
15. Post balance sheet events
There have been no material post balance sheet events.
16. Cautionary statement
The interim results announcement contains forward looking
statements. These have been made by the Directors in good faith
based on the information available to them up to the time of their
approval of this report. The Directors can give no assurance that
these expectations will prove to have been correct. Due to the
inherent uncertainties, including both economic and business risk
factors underlying such forward looking information, actual results
may differ materially from those expressed or implied by these
forward looking statements. The Directors undertake no obligation
to update any forward looking statements whether as a result of new
information, future events or otherwise.
There are a number of potential risks and uncertainties which
could have a material impact on the Group's performance over the
remainder of the financial year and could cause actual results to
differ materially from expected and historical results. These
include but are not limited to, competitor activity and competition
risk, changes in foreign exchange and commodity prices and the
political and economic risks of operating in Africa. Details of the
key risks facing the Group's businesses at an operational level are
included on pages 10 to 15 of the Group's Report and Accounts for
the 15month period to 31 December 2011 which is available on the
Group's website (www.lonrho.com). Details of further potential
risks and uncertainties arising since the issue of that document
are included within the operating review as appropriate.
17. Capital and reserves
Group reconciliation of movement in capital and reserves
Attributable to equity holders of the parent
Share Share Translation Share Revaluation Retained Other Total Non-controlling Total
capital premium reserve option reserve earnings reserves GBPm interest equity
GBPm GBPm GBPm reserve GBPm GBPm GBPm GBPm GBPm
GBPm
At 1 October
2010 11.7 138.0 (8.7) 4.7 3.3 (36.1) (5.5) 107.4 20.3 127.7
Share capital
issued 1.2 - - - - - 17.7 18.9 - 18.9
Share based
payments
charge - - 0.7 - - - 0.77 - 0.7
Share options
exercised 0.1 0.6 - - - - - 0.7 - 0.7
Costs associated
with share
issues - (0.4) - - - - - (0.4) - (0.4)
Non-controlling
interest
dividends - - - - - - - - (0.2) (0.2)
Profit/(loss)
for the period - - - - - 6.0 - 6.0 (5.5) 0.5
Subsidiaries
acquired - - - - - - - - 2.2 2.2
Subsidiaries
disposed - - - - - - - - (0.2) (0.2)
Transfer between
accounts - - - - (0.1) 0.1 - - - -
Revaluation - - - - 4.2 - - 4.2 3.0 7.2
Non-controlling
interest put
option - - - - - - (2.3) (2.3) - (2.3)
Capital element
of Convertible
Bond - - - - - - 1.1 1.1 - 1.1
Elimination of
non-controlling
interest - - - - - (0.6) - (0.6) 0.6 -
Foreign exchange
translation - - (1.7) - 1.7 (0.5) - (0.5) 0.3 (0.2)
AT 31 DECEMBER
2011 13.0 138.2 (10.4) 5.4 9.1 (31.1) 11.0 135.2 20.5 155.7
At 1 January
2012 13.0 138.2 (10.4) 5.4 9.1 (31.1) 11.0 135.2 20.5 155.7
Share capital
issued 2.6 - - - - - 22.9 25.5 - 25.5
Share based
payments
charge - - - 0.8 - - - 0.88 - 0.8
Share options
exercised 0.1 0.2 - - - - - 0.3 - 0.3
Costs associated
with share
issues - (2.2) - 1.1 - - - (1.1) - (1.1)
Profit/(loss)
for the period - - - - - 25.7 25.7 (2.2) 23.5
Elimination of
non-controlling
interest - - - - - - - - 8.0 8.0
Foreign exchange
translation - - (2.7) - - (0.1) - (2.8) (0.1) (2.9)
AT 30 JUNE 2012 15.7 136.2 (13.1) 7.3 9.1 (5.5) 33.9 183.6 26.2 209.8
On the 3 January 2012 269,498,795 new ordinary shares of 1p each
were issued by placing an open offer of shares. The placing
structure utilised attracted merger relied under Section 612 of the
Companies Act 2006, resulting in a credit to the Merger reserve
(included in Other reserves) of GBP22.9m. Subsequent internal
transactions required to complete the placing structure have
resulted in this becoming distributable. At 30 June 2012 the
company has GBP40.6m of such distributable reserves and net
distributable reserves of GBP28.4m.
18. Responsibility statement
The interim results announcement complies with the Disclosure
and Transparency Rules ("the DTR") of the Financial Services
Authority in respect of the requirement to produce a half yearly
financial report.
The Directors confirm that to the best of their knowledge:
-- This financial information has been prepared in accordance
with IAS 34 as adopted by the EU;
-- This interim results announcement includes a fair review of
the important events during the 6 months ended 30 June 2012 and
their impact on the financial information, and a description of the
principal risks and uncertainties for the remaining part of the
period as required by DTR 4.2.7R; and
-- This interim results announcement includes a fair review of
the disclosure of related party transactions and changes therein as
required by DTR 4.2.8R.
Geoffrey White
Director and Chief Executive Officer
10(th) August 2012
On behalf of the Board
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FKLLBLVFFBBV
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