Interim Results

RNS Number : 2920N

Cambria Africa PLC

30 May 2022

 

Cambria Africa Plc

Interim Results (the "Results") 

EPS of 0. 0084 US cents and NAV 1.16 US cents

For the 6 Months ended 28 February 20 22

Cambria Africa Plc ( AIM:CMB ) ("Cambria", the "Company" or together with its subsidiaries the "Group") is pleased to announce its interim results for the six months ended 28 February 20 22 (the "Period" or "H1 2022"). A copy of this announcement is available on the Company's website ( www.cambriaafrica.com ).

Profit after Tax increased by 158% to $245,000 for the Period compared to $95,000 achieved in the same period in 2021 ("H1 2021"). This was mostly due to increased revenue from Tradanet, the Company's 51% owned subsidiary.  Revenues rose to $540,000 in H1 2022 compared to $137,000 in H1 2021. The Company's Net Asset Value dropped 2% or $149,000 to $6.32 million (1.16 US cents per share) as at 28 February 2022 compared to H1 2021.

Excluding minority interests, Profit Attributable to Cambria Shareholders was $46,000 (0.01 US cents per share) for H1 2022, down from $72,000 in H1 2021. The Company's subsidiaries in Zimbabwe continued to operate above break-even; Millchem Zimbabwe's product sales in its joint venture with Merken, have slowed down significantly as predicted in prior communications.

Half Year 2022 Results Highlights
6 months ended 28 February 20 22 (US$'000)	20 22	20 21	Change
Group:
- Revenue	724	526	38%
- Operating costs	448	358	25%
- Consolidated EBITDA	299	205	46%
- Consolidated Profit after tax (PAT)	2 40	95	153%
- PAT attributable to shareholders (excluding minority interests)	46	72	( 36 %)
- Central costs	13	5 1	(75%)
- EPS - cents	0. 0084	0. 0132	(36%)
- NAV	6,319	6,468	(2%)
- NAV per share - cents	1.16	1.19	(2%)
- Weighted average of shares in issue	544,576	544,576	-
- Shares in issue at year end	544,576	544,576	-
Divisional:
- Payserv - consolidated PAT	251	1 36	85%
- Payserv - consolidated EBITDA	305	228	34%
- Millchem - EBITDA	3	28	(89%)

Group Highlights H1 2022:

Net Asset Value ("NAV") decreased by 2% from $6.468 million (1.19 US cents per share) in H1 2021 to $6.319 million (1.16 US cents per share) in H1 2022.

l Group Finance costs decreased to $7,000 in H1 2022 compared to $13,000 in H1 2021. Finance costs will continue to fall as the Group's outstanding debt nears zero. Current debt owing to Ventures Africa Limited ("VAL") stands at $106,000 which will be repaid in full by the end of the 2022 financial year.

l Group revenue recovered by 38% compared to prior year. This is due to Tradanet revenue increasing significantly as loans advanced by Central Africa Building Society, a subsidiary of Old Mutual Zimbabwe, increased in line with inflationary pressures, leading to higher salaries in the market.

l Cambria's Profit After Tax increased 153%, driven by asset sales and above break-even operations, to $240,000 in H1 2022 compared to $95,000 in H1 2021.

l Consolidated EBITDA was 46% higher in H1 2022 at $299,000 compared to $205,000 in H1 2021.  

l Cambria's central costs decreased by 75% to $13,000 compared to $51,000 in H1 2021. Cambria's CEO and Directors continued to render services to Cambria without compensation during H1 2022.

l Foreign currency translation losses of $194,000 and losses attributable to hyperinflationary accounting in this period were due to the depreciation of the Zimbabwean currency against the US Dollar from ZWL83.89 to the US Dollar as at 28 February 2021 to ZWL124.02 as at 28 February 2022.

Net Asset Value

The Company's net asset value reduced by 2% from $6.468 million in H1 2021 to $6.313 million (1.19 US cents per share) in H1 2022. This was due to the downward revaluation of the Company's business premises by $200,000 during the 2021 year-end audit.

Components of NAV as at 28 February 2022

The Group's NAV of $6.313 million as at the end of H1 2022 consists of the following tangible and intangible assets:

Building and properties valued at $2.3 million - T his valuation, down $200,000 from the prior valuation, was prepared by Hollands Harare Estate Agents ("Holland") in on the 27^th of January 2022. Holland also conducted the previous valuations of this prominently located commercial office space and its equally well-positioned vacant plot in Harare's Mount Pleasant Business Park.

Indirect shareholding of 9.74% of  Radar Holdings Limited  Valued at $1.743 million(net of minority interests) or 35 US cents per share. 

USD Cash and Cash Equivalents of $1.4 million  - Cash net of liabilities  outsideZimbabwe totalled$1.4 millionas at 27 May 2021. 

Old Mutual Limited shares -  T he Company holds 204,047 Old Mutual Limited common shares that were suspended on the Zimbabwe Stock Exchange ("ZSE") on 31 July 2020 and valued on its FY 2021 Consolidated Statement of Financial Position at $184,000 based on the closing price of Old Mutual Limited on the Johannesburg Stock Exchange ("JSE") at year end. The value of Old Mutual shares closed at $1 63,342 on the JSE on 27 May 2022.  

Goodwill - The Company has a goodwill value of $717,000 as at 28 February 2022.  The Company believes this is a fair assessment of its intangible assets. Despite the shrinkage of Paynet's operations, Cambria continues to maintain turnaround opportunities particularly in Tradanet and Autopay as real salaries catch up with inflation.  The Company continues to believe that the Paynet's intellectual property has value and the amalgamation of the above should exceed the book value of its goodwill.

Based on the above analysis, the Company believes its tangible, intangible and realizable NAV are not subject to significant negative shocks and may be the beneficiary of potential positive outcomes. 

Chief Executive's Report

The Company released its annual report for the financial year ended 31 August 2021 on the 31 of March 2022.  In the two months since that report, the most significant event subsequent has been a government pronouncement intended on halting inflation.  One measure, that of stopping all lending, was reversed soon after its intended implementation. Another measure was to bring convergence between the so-called "interbank rate" and the "auction rate" which are reference rates for the Reserve Bank of Zimbabwe's official exchange rates.  The net effect has been a doubling of the functional exchange rate to ZWL300 against the US dollar.  At this time, our best indication is that this rate still lags the parallel market rate by almost 30%.

The impact of these movements in the exchange rates should be taken into account when analyzing the Company's earnings in ZWL.  To the extent we can, we will be investing excess funds into a diversified portfolio on the Zimbabwe Stock Exchange to preserve value.  Regardless, we anticipate slower growth in the US dollar value of Tradanet's loan processing portfolio as a consequence of inflation and devaluation.  Similarly, we expect a decline in the real value of our Payroll processing revenues.  However, both operations should continue to trade at cashflow break-even levels. As mentioned in my CEO report at the end of FY2021, Cambria's story is now focused on realizing its NAV - which remains at 3.3x its trading price as of 27 May 2022.  I remain optimistic that this is a realistic and realizable goal.

Samir Shasha

30 May 2022

Contacts
Cambria Africa Plc	www.cambriaafrica.com
Samir Shasha	[phone]
WH Ireland Limited
James Joyce / Ben Good	[phone]

Cambria Africa Plc

Interim consolidated income statement

For the six month period ended 28 February 2022

		Unaudited		Unaudited		Audited
		6 months to		6 months to		Year to
		28-Feb- 22		28-Feb- 21		31-Aug- 21
		US$'000		US$'000		US$'000
Revenue		724		526		1,216
Cost of sales		( 64)		(78)		(138)
Gross profit		660		448		1,078
Operating costs		( 448)		( 358)		(838)
Other income		39		6 9		79
Exceptionals		(12)		(13)		(21)
Operating profit		2 39		1 46		298
Finance income		8		1		-
Finance costs		( 7)		(1 3)		(22)
Net finance costs		(1 )		(1 2)		(22)
Profit before tax		2 40		1 34		276
Income tax		-		( 39)		(95)
Profit / (loss) for the Period		240		95		181
Attributable to:
Owners of the Company		46		72		82
Non-controlling interests		1 94		23		99
Profit for the period		240		95		181
Earnings per share ("EPS")
Basic and diluted earnings per share (cents)		0. 01		0. 01		0.0 2
Weighted average number of shares for EPS ('000)		544,576		544,576		544,576

Cambria Africa Plc

Interim consolidated statement of comprehensive income

For the six month period ended 28 February 2022

		Unaudited		Unaudited		Audited
		6 months to		6 months to		Year to
		28-Feb- 22		28-Feb- 21		31-Aug- 21
		US$'000		US$'000		US$'000
Profit for the period		240		(15)		2,247
Other comprehensive income
Items that will not be reclassified to income statement:
Revaluation of investments held at fair value		-		-		200
Related deferred tax adjustment		-		-		(36)
Foreign currency translation differences for overseas operations		(194)		-		3
Foreign currency translation impact on non-controlling interests				-		-
Total comprehensive (loss) / profit for the period		46		(15)		2,414
Attributable to:
Owners		(148)		(15)		2,064
Non-controlling interests		194		-		350
Total comprehensive (loss) /  profit for the period		46		(15)		2,414

Cambria Africa Plc

Interim consolidated statement of financial position

As at 28 February 20 22

		Unaudited		Unaudited		Audited
		Group		Group		Group
		28-Feb- 22		28-Feb- 21		31-Aug- 21
		US$'000		US$'000		US$'000
Assets
Property, plant and equipment		2,311		2,558		2,317
Goodwill		717		717		717
Intangible assets		1		1		1
Investments at fair value		2,228		2,228		2,228
Total non-current assets		5,257		5,504		259
Inventories		160		75		5,522
Financial assets at fair value through profit and loss		219		251		158
Trade and other receivables		348		219		155
Cash and cash equivalents		1,574		1,540		1,656
Assets for discontinued operations		-		-		-
Total current assets		2,301		2,085		1,969
Total assets		7,558		7,589		7,491
Equity
Issued share capital		77		77		77
Share premium account		88,459		88,459		88,459
Revaluation reserve		(190)		-		(190)
Foreign exchange reserve		(10,983)		(10,763)		(10,734)
Non-distributable reserves		2,371		2,371		2,371
Retained losses		(73,421)		(73,676)		(73,665)
Equity attributable to owners of the Company		6,313		6,468		6,318
Non-controlling interests		600		506		477
Total equity		6,913		6,974		6,795
Liabilities
Loans and borrowing		106		-		101
Trade and other payables		89		65		90
Provisions		-		2		-
Deferred tax liabilities		189		193		189
Total non-current liabilities		384		260		380
Current tax liabilities		(1)		75		106
Loans and borrowings		-		45		-
Trade and other payables		261		235		209
Liabilities for discontinued operations		-		-		-
Total current liabilities		260		355		315
Total liabilities		644		615		695
Total equity and liabilities		7,557		7,589		7,490

Cambria Africa Plc

Interim consolidated statement of changes in equity

For the six month period ended 28 February 2022

US$'000		Share Capital	Share Premium	Revaluation Reserve	Foreign Exchange Reserve	Retained Earnings	Non-distributable Reserve	Total	Non-controlling Interest	Total
Balance at 31 August 20 20		77	88,459	-	(10,736)	(73,748)	2,371	6,423	496	6,919
(Loss)/profit for the period		-	-	-	-	72	-	72	23	95
Foreign currency translation differences for overseas operations		-	-	-	(28)	-	-	(28)	-	(28)
Foreign currency translation differences for overseas operations -NCI					1			1	(1)	-
Total comprehensive loss for the year		-	-	-	(27)	72	-	45	22	67
Contributions by/distributions to owners of the Company recognised directly in equity
Dividends paid		-	-	-	-	-	-	-	(1 2 )	(1 2 )
Total contributions by and distributions to owners of the Company		-	-	-	-	-	-	-	(1 2 )	(1 2 )
Balance at 28 February 20 21		51	8 8,459	-	(10, 763)	(7 3,676 )	2,371	6,468	506	6,974

US$'000		Share Capital	Share Premium	Revaluation Reserve	Foreign Exchange Reserve	Retained Earnings	Non-distributable Reserve	Total	Non-controlling Interest	Total
Balance at 31 August 20 20		77	88,459	-	(10,736)	(73,748)	2,371	6,423	496	6,919
Profit for the period		-	-	-	-	82	-	82	99	181
Revaluation of investments held at fair value		-	-	(190)	-	-	-	(190)	-	(190)
Related deferred tax adjustment		-	-	-	-	-	-	-	-	-
Transfer of translation reserve to discontinued operation - prior year		-	-	-	-	-	-	-	-	-
Foreign currency translation differences for overseas operations		-	-	-	(4)	-	-	(4)	-	(4)
Foreign currency translation differences for overseas operations - NCI		-	-	-	6	-	-	6	(6)	-
Total comprehensive loss for the year		77	88,459	(190)	(10,734)	(73,666)	2,371	6,317	589	6,906
Contributions by/distributions to owners of the Company recognised directly in equity
NCI on further investment in A F Philip & Company		-	-	-	-	-	-	-	-	-
Dividends paid to minorities		-	-	-	-	-	-	-	(112)	(112)
Total contributions by and distributions to owners of the Company		-	-	-	-	-	-	-	(112)	(112)
Balance at 31 August 20 21		77	88,459	(190)	(10,734)	(73,666)	2,371	6,317	477	6,794

US$'000		Share Capital	Share Premium	Revaluation Reserve	Foreign Exchange Reserve	Retained Earnings	Non-distributable Reserve	Total	Non-controlling Interest	Total
Balance at 31 August 20 21		77	88,459	(190)	(10,734)	(73,66 5 )	2,371	6,31 8	477	6,79 5
(Loss)/profit for the period		-	-	-	-	244	-	244	1 94	438
Foreign currency translation differences for overseas operations		-	-	-	(249)	-	-	(249)	-	(249)
Total comprehensive loss for the year		-	-	-	(249)	244	-	(5)	1 94	1 89
Contributions by/distributions to owners of the Company recognised directly in equity
Dividends paid		-	-	-	-	-	-	-	( 71 )	( 71)
Total contributions by and distributions to owners of the Company		-	-	-	-	-	-	-	( 71 )	( 71 )
Balance at 28 February 20 22		51	8 8,459	(190)	(10, 983 )	(7 3,421 )	2,371	6,313	60 0	6,913

Cambria Africa Plc

Interim consolidated statement of cash flows

For the six month period ended 28 February 20 22

		Unaudited 28-Feb-22 US$'000		Unaudited           28-Feb-21   US$'000		Audited       31-Aug-21 US$'000
Cash generated from operations		144		90		294
Taxation (paid)		(105)		(2)		(31)
Cash generated from operating activities		(39)		88		263
Cash flows from investing activities Proceeds on disposal of property, plant and equipment		15		72		144
Purchase of property, plant and equipment		-		-		-
Net proceeds from marketable securities		-		-		-
Other investing activities		-		-		(210)
Interest received		8		1		-
Net cash (utilized in)/ generated investing activities		23		73		(66)
Cash flows from financing activities Dividends paid to non-controlling interests		(71)		(12 )		(112)
Interest paid		(7)		( 13 )		(22)
Proceeds from issue of share capital		-		-		-
Loans repaid		-		( 464)		(299)
Proceeds from drawdown of loans		-		-		-
Net cash (utilized) by financing activities		(78)		( 489 )		(433)
Net (decrease)/ increase in cash and cash equivalents		(128)		(328)		(236)
Cash and cash equivalents at the beginning of the Period		1,656		1, 896		1,896
Foreign exchange		(194)		( 28 )		(4)
Net cash and cash equivalents at 31 August		1,574		1, 540		1 ,656
Cash and cash equivalents as above comprise the following Cash and cash equivalents attributable to continuing operations		1,574		1,540		1, 656
Net cash and cash equivalents at 31 August		1,574		1, 540		1,656

* A mounts include both continuing and discontinued operations.

 

END

 

 

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