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REA Vipingo Plantations Limited HY 2012 results
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REA Vipingo Plantations Limited HY 2012 results

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REA Vipingo Plantations Limited HY 2012 results

REA Vipingo Plantations Limited HY 2012 results

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    REA Vipingo Plantations Limited HY 2012 results REA Vipingo Plantations Limited HY 2012 results Document Transcript

    • REA VIPINGO PLANTATIONS LIMITED Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 REA Vipingo Plantations Limited P.O. Box 17648, Nairobi 00500 Telephone: 6007091, Fax: 6007116 Website: www.reavipingo.com
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Chairman’s statement The year has started well for the group and I am very pleased to report a profit before tax for the first six months of shs 302 million, some shs 74 million or 32.60% more than was achieved for the corresponding period last year. Fibre production from our estates in Tanzania has been below expectations during the period under review but, fortunately, volumes from our Kenyan estates have been good and, overall, the group has produced to budget. The current rains have been good at all our locations with the exception of our Dwa estate which has not benefited from the good rainfall that most of East Africa has enjoyed this season. Despite this, we do expect Dwa to produce more or less to expectations during the remainder of this financial period. The Tanga spinning mill has been busy and is well placed with orders, particularly from the East African region, for the next quarter at least. Prices for spun product have been satisfactory into most markets with the result that margins have generally been acceptable. Whilst sisal fibre prices remain satisfactory, and our overall profitability good, we do expect to see some tightening of margins during the second half of the year due to inflationary increases in operating costs generally, but specifically in Tanzania where wages have increased significantly, electric power continues to be unreliable, and volumes below expectations. Whilst operationally the business is well positioned, your directors are mindful of the uncertainties in the global economy as a result of the ongoing economic difficulties in the eurozone. It remains to be seen how the situation in Europe will develop and the impact that any major escalation of the crisis could have on the principal markets into which we sell. OLIVER FOWLER CHAIRMAN 1
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Condensed consolidated statement of comprehensive income Notes Six months ended 31 March 2012 2011 Shs’000 Shs’000 Revenue 4 1,250,034 974,725 Gain arising from changes in fair value of biological assets 40,421 38,508 Cost of sales (637,442) (513,161) Gross Profit 653,013 500,072 Interest income 9 9 Other operating income 18,653 8,196 Distribution costs (39,094) (40,661) Administrative expenses (277,121) (224,080) Other operating expenses (3,676) (453) Finance costs 5 (16,683) (14,444) Foreign exchange losses (33,212) (944) Profit before tax 301,889 227,695 Tax (93,487) (74,293) Profit for the period 208,402 153,402 Comprising: Profit arising from operating activities 180,108 126,446 Gain arising from changes in fair value of biological assets 28,294 26,956 208,402 153,402 Other comprehensive (loss)/income Exchange differences on translation of foreign operations (85,428) 11,547 Total comprehensive income for the period 122,974 164,949 Earnings per share - basic and diluted 7 Shs 3.47 Shs 2.56 2
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Condensed consolidated statement of financial position Notes 31 March 2012 30 September 2011 31 March 2011 Shs’000 Shs’000 Shs’000 Restated ASSETS Non-current assets Property, plant and equipment 8 761,869 753,404 670,523 Biological assets 9 596,924 603,608 461,430 Investment property 10 4,647 4,674 9,403 Investment in unquoted shares 9,151 9,151 15,251 Deferred tax assets 1,654 8,233 35,858 Post employment benefit assets 15,524 15,524 - 1,389,769 1,394,594 1,192,465 Current assets Inventories 486,722 531,612 417,091 Receivables and prepayments 301,519 314,994 253,440 Tax recoverable 7,534 14,839 4,922 Bank balances and cash 63,644 32,701 20,588 859,419 894,146 696,041 Total assets 2,249,188 2,288,740 1,888,506 EQUITY AND LIABILITIES Capital and reserves Share capital 300,000 300,000 300,000 Share premium 84,496 84,496 84,496 Translation deficit (139,383) (53,955) (102,973) Retained earnings 1,280,721 1,138,319 824,525 Shareholders’ funds 1,525,834 1,468,860 1,106,048 Non-current liabilities Borrowings 11 64,803 91,846 33,325 Deferred tax liabilities 208,769 210,661 155,137 Post employment benefit obligations 96,261 92,137 82,016 Other liabilities - - 29,047 369,833 394,644 299,525 Current liabilities Payables and accrued expenses 144,630 168,531 126,871 Tax payable 51,423 37,949 22,735 Borrowings 11 91,468 183,815 256,280 Dividend payable 6 66,000 - 48,000 Other liabilities - 34,941 29,047 353,521 425,236 482,933 Total equity and liabilities 2,249,188 2,288,740 1,888,506 3
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Condensed consolidated statement of changes in equity Retained earnings Share capital Share premium Translation deficit Biological assets fair value Other Total Total Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Shs’000 Balance at 1 October 2010 300,000 84,496 (114,520) 153,067 566,056 719,123 989,099 Profit for the period - - - 26,956 126,446 153,402 153,402 Other comprehensive income for the period - - 11,547 - - - 11,547 Total comprehensive income for the period - - 11,547 26,956 126,446 153,402 164,949 Dividend for 2010 - - - - (48,000) (48,000) (48,000) Balance at 31 March 2011 300,000 84,496 (102,973) 180,023 644,502 824,525 1,106,048 Balance at 1 October 2011 300,000 84,496 (53,955) 260,075 878,244 1,138,319 1,468,860 Profit for the period - - - 28,294 180,108 208,402 208,402 Other comprehensive loss for the period - - (85,428) - - - (85,428) Total comprehensive income for the period - - (85,428) 28,294 180,108 208,402 122,974 Dividend for 2011 - - - - (66,000) (66,000) (66,000) Balance at 31 March 2012 300,000 84,496 (139,383) 288,369 992,352 1,280,721 1,525,834 The translation deficit represents the cumulative position of translation gains and losses arising from the conversion of the net assets of the foreign subsidiary companies, and also the long term loan to a subsidiary company, to the reporting currency. 4
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Condensed consolidated statement of cash flows Six months ended 31 March 2012 2011 Shs’000 Shs’000 Cash generated from operations 285,333 101,272 Interest received 9 9 Interest paid (16,683) (14,444) Tax paid (49,658) (3,574) Net cash generated from operating activities 219,001 83,263 Cash flows from investing activities Purchase of property, plant and equipment (85,747) (73,535) Proceeds from disposals of property, plant and equipment 511 4,047 Net cash used in investing activities (85,236) (69,488) Cash flows from financing activities Proceeds from long-term borrowings - 82,316 Repayment of long-term borrowings (19,372) (21,288) Repayment of short term borrowings - (65,325) Net cash used in financing activities (19,372) (4,297) Increase in cash and cash equivalents 114,393 9,478 Movement in cash and cash equivalents At start of interim period (94,047) (144,730) Increase 114,393 9,478 Effects of exchange rate changes 4,951 (451) At end of interim period 25,297 (135,703) 5
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Notes to the consolidated condensed financial statements 1 General information REA Vipingo Plantations Limited (the company) is incorporated in Kenya under the Kenya Companies Act as a limited liability public company and is domiciled in Kenya. The address of the registered office is: 1st Floor, Block D Wilson Business Park P.O. Box 17648-00500 Nairobi Kenya The company is engaged in the cultivation of sisal and the production of sisal fibre and also acts as a holding company. The subsidiary companies, which are wholly owned and unquoted and whose results for the period are included in these condensed consolidated financial statements are: Company Country of incorporation Principal activity Amboni Plantation Limited Tanzania Cultivation of sisal and sale of sisal fibre Amboni Spinning Mill Limited Tanzania Manufacture and sale of sisal twine and yarn Dwa Estate Limited Kenya Cultivation of sisal and sale of sisal fibre; cultivation and sale of agricultural produce. Wigglesworth Exporters Limited Kenya Export of sisal fibre Vipingo Estate Limited Kenya Property holding 2 Basis of preparation The condensed financial statements have been prepared in accordance with International Accounting Standard 34 - Interim Financial Reporting. 6
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Notes to the consolidated condensed financial statements (continued) 3. Significant accounting policies The condensed financial statements have been prepared under the historical cost convention except where otherwise stated. The same accounting policies, presentation and methods of computation have been followed in these condensed financial statements as were applied in the preparation of the annual financial statements for the year ended 30th September 2011. The statement of financial position at 31st March 2011 has been restated to reflect the change in accounting policy for leasehold land which was adopted in the financial statements for the year ended 30th September 2011. These financial statements are presented in Kenya Shillings Thousands (Shs’000). Costs that incur unevenly during the financial year are anticipated or deferred in the interim report only if it would also be appropriate to anticipate or defer such costs at the end of the financial year. Income tax expense is recognised based on the best estimate of the weighted average annual income tax rate expected for the full financial year. The estimated average annual tax rate used for 2012 is 30% (the estimated tax rate used for the first half year of 2011 was 30%). The interim financial statements should be read in conjunction with the 2011 annual financial statements. 4 Segment information Agriculture Spinning Total Shs’000 Shs’000 Shs’000 Six months ended 31 March 2012 Total sales 1,106,927 224,749 1,331,676 Inter-segment sales (80,137) (1,505) (81,642) Sales revenue 1,026,790 223,244 1,250,034 Profit before tax 275,970 25,919 301,889 Segment assets 2,102,463 146,725 2,249,188 Segment liabilities 689,736 33,618 723,354 Six months ended 31 March 2011 Total sales 890,598 157,005 1,047,603 Inter-segment sales (64,835) (8,043) (72,878) Sales revenue 825,763 148,962 974,725 Profit/(loss) before tax 235,552 (4,857) 227,695 Segment assets 1,740,300 148,206 1,888,506 Segment liabilities 740,545 41,913 782,458 7
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Notes to the consolidated condensed financial statements (continued) 5 Finance costs Six months ended 31 March 2012 2011 Shs’000 Shs’000 Interest expense 16,683 14,444 6 Dividend A final dividend in respect of the year ended 30 September 2011 of shs 1.10 per share amounting to Shs 66,000,000 was approved at the Annual General Meeting held on 30 March 2012. No dividend is proposed in respect of the half year to 31 March 2012 (2011:nil). 7 Earnings per share Basic earnings per share is calculated by dividing the profit for the period by the weighted average number of ordinary shares in issue during the period (2012 and 2011:60,000,000). There were no potentially dilutive shares outstanding at 31 March 2012 or 31 March 2011. 8 Capital expenditure and commitments Property, plant and equipment Shs’000 Six months ended 31 March 2012 Net book amount at start of period 753,404 Additions 85,747 Disposals at net book amount (84) Translation adjustment (37,271) Depreciation for the period (39,927) Net book amount at end of period 761,869 Capital commitments at 31 March 2012 25,083 8
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Notes to the consolidated condensed financial statements (continued) At 31 March 2012 Shs’000 9 Biological assets Sisal plants Horticultural crops Total Six months ended 31 March 2012 Carrying amount at start of period Immature crops 173,004 1,812 174,816 Mature crops 426,487 2,305 428,792 Total 599,491 4,117 603,608 Loss arising from changes in fair value attributable to physical changes (28,618) (792) (29,410) Gain arising from changes in fair value attributable to price changes 100,581 - 100,581 Loss arising from changes in fair value attributable to changes in exchange rate (30,750) - (30,750) Net fair value gain / (loss) 41,213 (792) 40,421 Translation adjustment (47,105) - (47,105) Carrying amount at end of period 593,599 3,325 596,924 Immature crops 237,521 2,537 240,058 Mature crops 356,078 788 356,866 Total 593,599 3,325 596,924 The assumptions made in determining the fair value of biological assets remain unchanged from those made in respect of the year to 30th September 2011. 10 Investment property Six months ended 31 March 2012 Shs’000 Net book amount at start of period 4,674 Depreciation for the period (27) Net book amount at end of period 4,647 9
    • REA Vipingo Plantations Limited Unaudited Condensed Consolidated Financial Statements For the six months ended 31 March 2012 Notes to the consolidated condensed financial statements (continued) At 31 March Shs’000 11 Borrowings Total borrowings 156,271 Less: current portion 91,468 Non-current portion 64,803 Non-current Bank borrowings 64,803 Current Bank overdrafts 38,347 Bank borrowings 53,121 91,468 Total borrowings 156,271 12 Issued Capital Issued and fully paid capital at the end of the period was 60 million ordinary shares with a par value of shs 5 per share. There were no movements in the issued capital of the company in either the current or the prior interim reporting periods. 13 Related party transactions The majority of sales continue to be made to a related party contracted at market prices. 14 Approval of interim statements The interim financial statements were approved by the board of directors on 24th May 2012. 10