RNS Number:4798P
Plantation & General Investmnts.PLC
05 September 2003
Plantation & General Investments Plc
Interim Report 2003
Chairman's Statement
The Group profit before tax and hyper-inflation adjustment for the half year to
30th June 2003 was #1,463,000, broadly similar to what was achieved in the same
period last year. The higher proportion of overseas profits resulted in a higher
corporation tax charge compared with last year.
All the plantation businesses increased their profits, but these were offset by
a loss in our UK operations and also significant non-recurring costs from
appraising a major potential acquisition.
Tea crops increased by 10% and roses by 34%, while tea prices were a little
below those achieved in 2002.
The Malawi tea estates again provided the largest contribution to Group profits,
with further improvements in yields and quality and tight control on costs. High
interest charges on local currency borrowings in Malawi have been mitigated by
switching part of the borrowings into US dollars.
The Zimbabwe estate, Eastern Highlands, continued to benefit from significant
changes in the market rate of exchange, despite local inflation that is now
running at nearly 400% a year. Our estate managers have so far contained the
problems associated with deteriorating economic and social conditions in
Zimbabwe, although there has been some reduction in crop yields and quality.
Both the Zambian rose farm, Khal-Amazi, and the Indonesian rubber estate, Air
Muring, achieved higher crops. They also benefited from higher rose and rubber
prices.
In my statement on the results for 2002, I mentioned that the profits and
working capital requirements of Jacobs Young & Westbury would be significantly
reduced by a change in the terms of trading. This change is reflected in the
current half year's results, and is the main reason for the reduction in Group
turnover of approximately #20 million, compared with the half year to June 2002.
Chillington, the Group's wheelbarrow manufacturer, had a very poor six months
and has not yet recovered from the disruption caused by moving to its new site.
Steel price increases at the beginning of 2003 also eroded margins, whilst sales
have been weak. Significant management changes have been made.
Although there have been no acquisitions or disposals so far this year, we
continue to seek ways to develop the Group. This is a two pronged approach -
selling our remaining non-core businesses while seeking opportunities to buy.
The second half of the year is always difficult, not least because the seasonal
reduction in crops needs to be mitigated by corresponding reduction in costs.
The powerful but unpredictable parts of the equation are the start of the
Southern African rains (which last year occurred relatively early), exchange
rate movements and tea prices. All these are largely outside our control.
Rupert Pennant-Rea
5 September 2003
PLANTATION & GENERAL INVESTMENTS
PLC
Consolidated profit & loss account
------------------------------------
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2003 2002 2002
Note #'000 #'000 #'000
Turnover 14,816 34,926 47,219
-------- ------- --------
Operating profit 2,294 2,566 1,082
Profit on disposal or closure of - 199 199
operations
Profit on disposal of properties - - 774
Profit on disposal of investments - 7 7
-------- ------- --------
Profit before interest 2,294 2,772 2,062
Interest (831) (1,267) (2,110)
-------- ------- --------
Profit/(loss) after interest 1,463 1,505 (48)
Monetary working capital (73) 120 (139)
hyper-inflation adjustment -------- ------- --------
Profit/(loss) before taxation 1,390 1,625 (187)
Taxation 2 (563) (362) (265)
-------- ------- --------
Profit/(loss) after taxation 827 1,263 (452)
Minority interests (40) 10 145
-------- ------- --------
Profit/(loss) for the period and
Amount transferred to/(from) 787 1,273 (307)
reserves -------- ------- --------
pence pence pence
Earnings/(loss) per ordinary share 3
Basic 1.5 2.5 (0.6)
-------- ------- --------
Summarised consolidated balance sheet
-------------------------------------
As at As at As at
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Fixed assets 24,869 27,632 25,603
-------- -------- --------
Current assets
Stocks 2,370 4,670 2,918
Debtors 4,807 9,150 2,701
Cash at bank and in hand 574 596 741
-------- -------- --------
7,751 14,416 6,360
-------- -------- --------
Creditors falling due within one year:
Debt finance (2,849) (5,804) (2,618)
Other (4,879) (8,583) (3,976)
-------- -------- --------
Net current assets/(liabilities) 23 29 (234)
-------- -------- --------
Total assets less current liabilities 24,892 27,661 25,369
Creditors falling due after more than one year:
Debt finance (10,046) (9,515) (10,550)
Other (344) (292) (354)
Provision for liabilities and charges (244) (175) (229)
-------- -------- --------
14,258 17,679 14,236
======== ======== ========
Capital and reserves
Called up share capital 12,948 12,946 12,948
Reserves 125 3,200 21
-------- -------- --------
Shareholders' funds - equity 13,073 16,146 12,969
Minority interests 1,185 1,533 1,267
-------- -------- --------
14,258 17,679 14,236
======== ======== ========
Statement of total recognised gains and losses
------------------------------------------------
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Profit/(loss) for the period 787 1,273 (307)
Monetary working capital hyper-inflation 73 (120) 139
adjustments
Revaluation (deficit)/surplus net of minority (76) 2,995 2,835
interests
Exchange differences (680) (4,375) (6,072)
-------- -------- --------
Total recognised gains/(losses) for the period 104 (227) (3,405)
======== ======== ========
Statement of movement in shareholders' funds
----------------------------------------------
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
At beginning of period as previously reported 12,969 16,674 16,674
Prior year adjustment - deferred tax - (50) (50)
-------- -------- --------
At beginning of period as restated 12,969 16,624 16,624
Total recognised gains/(losses) for the period 104 (227) (3,405)
Reversal of capital reserve less goodwill on - (251) (251)
disposal
Issue of new shares (net of expenses) - - 1
-------- -------- --------
At end of period 13,073 16,146 12,969
======== ======== ========
Consolidated cash flow statement
---------------------------------
Six months Six months
ended ended Year ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
Cash flow from operating activities 1,313 987 3,504
Returns on investments and servicing
of finance (911) (1,329) (2,172)
Taxation - Oversea tax paid (28) (75) (110)
Net fixed asset and investment additions (302) (391) 187
Acquisitions and disposals - 821 821
72 13 2,230
Financing
Issue of shares - - 1
Loans (net of repayments) (158) 551 60
Capital elements of finance lease rentals payable (99) (113) (219)
Total financing (257) 438 (158)
-------- ------- --------
(Decrease)/increase in cash in the period (185) 451 2,072
-------- -------- ------- --------
Reconciliation of net cash flow to movement
in net debt
(Decrease)/increase in cash in the period (185) 451 2,072
Cash outflow/(inflow)from change in debt 158 (551) (60)
Cash outflow from reduction in finance
liabilities 99 113 219
-------- ------- --------
Change in net debt resulting from cash flows 72 13 2,231
New finance leases (28) (162) (248)
Exchange translation differences 62 1,516 1,680
Net borrowings disposed with subsidiaries - 22 22
-------- ------- --------
Movement in net debt in the period 106 1,389 3,685
-------- ------- --------
Net debt at beginning of period (12,427) (16,112) (16,112)
Net debt at end of period (12,321) (14,723) (12,427)
-------- ------- --------
106 1,389 3,685
-------- ------- --------
Reconciliation of operating profit to operating
cash flow
Operating profit 2,294 2,566 1,082
Depreciation 480 833 1,558
Amortisation of goodwill 27 27 55
Working capital (increase)/decrease
Stocks 548 3,380 5,132
Debtors (2,106) (4,138) 2,311
Creditors 468 23 (4,380)
Exchange translation difference on working
capital (390) (717) (1,209)
Working capital derived from disposal of
subsidiary undertakings - (1,004) (1,004)
Disposal of tangible fixed assets (8) 17 (41)
-------- ------- --------
1,313 987 3,504
-------- ------- --------
Notes to the interim
statements
1.Basis of preparation of
interim financial statements
The results for the six months ended 30 June 2003 and 30 June 2002 are
unaudited. They have been prepared on accounting bases and policies consistent
with those used in the Annual Report and Accounts for the year ended 31 December
2002. The comparative figures for the year ended 31 December 2002 are an extract
from the full accounts for the year which have been filed with the
Registrar of Companies and on which the auditors have made a report under
Section 235 of the Companies Act 1985 - such report was qualified on a technical
issue concerning directors' valuations of oversea plantations, factories and
ancillary property and did not contain a statement under Section 237(2) or (3)
of the Companies Act.
2. Taxation Six months Six months
ended ended Year ended
30 June 30 June 31 December
2003 2002 2002
#'000 #'000 #'000
UK Corporation tax (after double - - -
taxation relief)
Foreign tax - Current taxation 493 205 72
Deferred taxation 70 157 193
-------- ------- --------
563 362 265
======== ======= ========
3. Earnings/(loss) per ordinary
share
Basic earnings per ordinary share for the six months ended 30 June 2003 is
calculated on a weighted average of 51,791,603 ordinary shares (six months ended
30 June 2002 51,783,719 ordinary shares and year ended 31 December 2002
51,787,024 ordinary shares). The conversion of convertible loan stock would be
antidilutive.
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