Interim Results

Camellia PLC 26 September 2002 Camellia Plc Interim Statement Pre-tax profits of Â£2,221,000 for the six months to the 30th June 2002 compared with Â£6,084,000 for the same period last year. The decline is mainly attributable to the exceptional results from Lumley Cazalet Limited in 2001 not being repeated, the poor situation of tea production and prices in India and Bangladesh and other one-off profits earned on the disposal of investment and subsidiary undertakings in 2001. The Board has declared an interim dividend of 20p per ordinary share payable on the 7th November 2002 to shareholders on the register on the 11th October 2002. Tea India Currently the tea industry in India is suffering from a crisis that is severely affecting prices and the viability of some estates. The reasons for this include the failure of the domestic market to develop as anticipated, increased competition from other beverages, a general lack of interest from importers and increasing supplies of tea from small bought leaf factories. These factors coupled with lower than anticipated crops have led to the most difficult conditions seen by the industry for several decades. The Group is fortunate in having estates spread between West Bengal and Assam and, to some extent, will be cushioned from these problems. However, if there is no upward movement in prices in the near future, the Group's profitability will be impaired. All possible steps to economise and control costs continue to be stringently applied. The instant tea plant has received some useful orders and the outlook is more encouraging than in previous years. Bangladesh Whilst crops from the Longbourne tea estates are almost 13% behind last year, prices are on par with 2001 and prospects are, therefore, reasonably satisfactory. The export position is also promising with an anticipated substantial Government sponsored order from Pakistan. Africa Tea production in both Kenya and Malawi was below that of the previous year and tea prices in Kenya have also been lower, although there is some evidence of a modest increase over the last few weeks. Production on our newly acquired estates in South Africa was above that of the same period last year, but slightly below our expectations. Coffee In Kenya the impact of the uncertainties in the international coffee markets continue and recent prices for the early coffee crop at Kakuzi have been disappointing and below cost of production. Kakuzi continue to implement cost saving measures, but the prospects for this crop are not encouraging. Citrus The citrus operations in Australia have experienced a heavy crop of small fruit resulting in marketing difficulties. New citrus developments in California, Chile and South Africa are progressing in accordance with our expectations. Edible Nuts Macadamia production in Malawi and South Africa has been satisfactory and current price levels are in excess of the previous year. The pistachio harvest in California is anticipated to be favourable, although the almonds are in decline due to the age of the trees. Other Horticulture Climatic conditions in both South Africa and Chile had a detrimental effect on the production of table grapes although prices in local currency terms were satisfactory. Wine grape production in both Australia and South Africa was satisfactory although the significant surplus of wine on World markets also leads to difficult market conditions. Rubber crops in Bangladesh increase in line with budget and prices have recently increased. Food Storage and Distribution Associated Cold Stores & Transport is suffering from escalating costs and very competitive pricing due to over capacity in the market. Increases in insurance premiums are of particular concern. W.G. White has seen a marked decline in caviar volumes and is also incurring additional costs as it expands its wine distribution business. Engineering Several of our UK engineering operations are experiencing difficult trading conditions and the recently imposed additional corporation tax burden on oil companies has resulted in a reduction in drilling activity in the North Sea which seems to have affected the workload of AJT Engineering and AKD Engineering. Other parts of the UK engineering businesses are performing satisfactorily. Results for the UK engineering operations for the year are expected to be well below those of the previous year. Fine Art Trading As anticipated, the operations of Lumley Cazalet are being wound down during the present year. The realisation of the stock is going to plan and is expected to be fully disposed of by November 2002. Banking Duncan Lawrie Limited is experiencing another difficult year in 2002. The problems of the financial services industry are well documented and Duncan Lawrie is certainly not immune to the problems of lower margins and lack of investment activity. Pharmaceutical Our associated company, Siegfried AG, produced very satisfactory half-year results and has strengthened its position as a leading supplier of active pharmaceutical ingredients. In particular, its custom manufacturing and generic production businesses continue to develop positively and the prospects for the year are encouraging. Other Associated Undertakings and Investments United Leasing Company Limited is having a good year and it is anticipated that their profit may exceed last year. United Insurance Company Limited is also operating satisfactorily. Prospects The overall prospects for the Group are difficult to predict. The full impact of the current El Nino weather pattern has yet to be fully assessed, but drought or any disruption to the normal late rains will obviously reduce earnings considerably. M.C. PERKINS Chairman 26th September 2002 Camellia Plc Consolidated Profit and Loss Account for the six months ended 30th June 2002 Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Restated Restated Notes Â£'000 Â£'000 Â£'000 Turnover - continuing operations 81,283 85,597 180,172 - discontinued operations - 23,174 23,175 1 81,283 108,771 203,347 Operating (loss)/profit - continuing operations 1 (1,914) 2,460 11,656 - discontinued operations - 248 248 (1,914) 2,708 11,904 Share of results of associates 5,447 1,622 5,349 3,533 4,330 17,253 Investment income 792 659 1,453 Profit on disposal of fixed asset investments 182 716 573 Profit on disposal of subsidiary undertaking 3 - 424 424 Goodwill transferred upon part disposal of subsidiary - 704 704 Share of associates profit on disposal of subsidiaries - 1,800 2,065 Profit on disposal of fixed assets - - 24 4,507 8,633 22,496 Net interest payable and similar charges 4 2,286 2,549 4,940 Profit on ordinary activities before taxation 2,221 6,084 17,556 Taxation on profit on ordinary activities 5 2,505 3,798 4,183 (Loss)/profit on ordinary activities after taxation (284) 2,286 13,373 Interest of minority shareholders 1,045 963 3,146 Attributable (loss)/profit for the period (1,329) 1,323 10,227 Dividends 6 532 544 2,303 Earnings per share 7 (49.95)p 48.40p 374.48p Camellia Plc Consolidated Balance Sheet at 30th June 2002 30th June 30th June 31st December 2002 2001 2001 Restated Restated Â£'000 Â£'000 Â£'000 Fixed assets Goodwill Positive 1,183 1,255 1,219 Negative (3,874) (4,036) (4,074) (2,691) (2,781) (2,855) Tangible assets 244,269 247,635 244,793 241,578 244,854 241,938 Current assets Stocks 31,203 36,161 34,100 Debtors 55,305 62,682 55,514 Cash at banks and in hand (note 8) 172,178 165,487 164,493 258,686 264,330 254,107 Creditors: amounts falling due within one year (223,553) (220,117) (212,562) Net Current Assets 35,133 44,213 41,545 Total assets less current liabilities 276,711 289,067 283,483 Creditors: amounts falling due after more than one year (41,357) (41,622) (39,587) Provisions for liabilities and charges (7,122) (9,402) (7,595) 228,232 238,043 236,301 Capital and reserves Called up share capital 266 272 271 Reserves 168,134 173,754 174,242 Equity shareholders' funds 168,400 174,026 174,513 Minority shareholders' interest 59,832 64,017 61,788 228,232 238,043 236,301 Camellia Plc Consolidated Cash Flow Statement for the six months ended 30th June 2002 Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Notes Â£'000 Â£'000 Â£'000 Net cash flow from operating activities 9 3,243 6,388 22,033 Dividends received from associates 158 546 629 Returns on investments and servicing of finance (2,953) (2,029) (4,080) Taxation paid (1,330) (1,964) (4,916) Capital expenditure and financial Investment (4,742) (6,636) (12,520) Acquisitions and disposals 412 1,056 308 Equity dividends paid - - (2,267) Cash outflow before financing (5,212) (2,639) (813) Financing New loans 5,873 8,256 9,862 Loan and finance lease payments (3,155) (3,616) (7,893) Purchase of own shares (1,514) (1,817) (1,693) (Decrease)/increase in cash in the period 10 (4,008) 184 (537) Camellia Plc Statement of Total Recognised Gains and Losses for the six months ended 30th June 2002 Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Restated Restated Â£'000 Â£'000 Â£'000 Attributable (loss)/profit for the period (1,329) 1,323 10,227 Release of goodwill on disposal of subsidiary undertaking - 515 515 Release of goodwill on part disposal of subsidiary undertaking - (704) (704) Impairment on previously revalued tangible assets - - (384) Share of associates fixed asset revaluation - - 539 Exchange differences (2,738) 3,455 (3,008) Total recognised gains and losses for the period (4,067) 4,589 7,185 Prior period adjustment (4,515) Total gains and losses since last annual report (8,582) Reconciliation of Movement in Shareholders' Funds for the six months ended 30th June 2002 Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Restated Restated Â£'000 Â£'000 Â£'000 Attributable (loss)/profit for the period (1,329) 1,323 10,227 Dividends (532) (544) (2,303) Exchange differences (2,738) 3,455 (3,008) Purchase of own shares (1,514) (1,510) (1,860) Release of goodwill on disposal of subsidiary undertaking - 515 515 Release of goodwill on part disposal of subsidiary undertaking - (704) (704) Impairment of previously revalued tangible assets - - (384) Share of associates fixed asset revaluation - - 539 Net movement in shareholders' funds (6,113) 2,535 3,022 Opening shareholders' funds 174,513 177,091 177,091 Prior period adjustment - (5,600) (5,600) Opening shareholders' funds restated 174,513 171,491 171,491 Closing shareholders' funds 168,400 174,026 174,513 The prior period adjustment is the additional deferred tax provision attributable to equity shareholders arising from the adoption of FRS 19 - 'Deferred Tax'. Notes to the Accounts 1 Segmental analysis of turnover and operating profit/(loss) Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 Turnover By activity Agriculture and horticulture 48,496 49,495 108,955 Trading and agency 3,621 3,368 6,509 Food storage and distribution 21,200 22,559 45,215 Engineering 6,743 7,583 14,478 Fine art trading and philately 170 1,461 2,812 Property leasing 972 1,084 2,177 Central management and miscellaneous 81 47 26 81,283 85,597 180,172 Discontinued - Trading and agency - 23,174 23,175 81,283 108,771 203,347 By country of origin United Kingdom 27,399 30,283 59,748 Continental Europe 4,959 5,368 10,628 India 11,092 11,956 34,593 Kenya 10,025 13,148 25,184 Malawi 7,232 8,452 11,664 Bangladesh 3,648 3,344 8,243 North America 146 162 403 South America and Bermuda 1,471 1,545 2,255 Australia 7,869 7,518 20,587 South Africa 7,442 3,821 6,867 81,283 85,597 180,172 Discontinued - United Kingdom - 23,174 23,175 81,283 108,771 203,347 Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 Operating Profit By activity Agriculture and horticulture (714) 629 9,557 Trading and agency 725 830 573 Food storage and distribution 282 1,822 3,076 Engineering 478 1,214 1,287 Fine art trading and philately (122) 311 411 Property leasing 942 1,018 2,088 Central management and miscellaneous (3,221) (3,482) (5,501) (1,630) 2,342 11,491 Discontinued - Trading and agency - 248 248 (1,630) 2,590 11,739 Banking (287) 118 152 Net interest from group companies 3 - 13 (1,914) 2,708 11,904 Associated undertakings Agriculture and horticulture (116) (91) (34) Pharmaceutical 5,108 1,188 4,218 Insurance and leasing 455 525 1,165 3,533 4,330 17,253 By country of origin United Kingdom (1,000) 1,923 2,751 Continental Europe 2 108 223 India (4,070) (3,704) 902 Kenya 1,043 1,985 3,601 Malawi 2,303 3,063 2,109 Bangladesh (943) (919) 1,034 North America (160) (60) (681) South America and Bermuda (81) (187) (460) Australia 89 269 2,148 South Africa 903 (18) 29 (1,914) 2,460 11,656 Discontinued - United Kingdom - 248 248 (1,914) 2,708 11,904 Continuing operations include turnover of Â£6,477,000 for the six months (2001 six months: Â£2,366,000 - year: Â£5,726,000) and operating profit of Â£952,000 for the six months (2001 six months: Â£58,000 loss - year: Â£72,000 loss) relating to an acquisition on 30th April 2001 and were by activity - agriculture and horticulture and by country of origin - South Africa. 2 Business interruption insurance proceeds of Â£415,000 (2001 six months: Â£910,000 - year: Â£1,272,000) have been credited to operating profit. 3 Profit on disposal of subsidiary undertakings comprises: Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 Profit on disposal of subsidiary - 802 802 Positive goodwill transferred from reserves - (515) (515) Negative goodwill transferred from fixed assets - 137 137 - 424 424 4 Net interest payable includes Â£363,000 (2001 six months: Â£359,000 - year: Â£590,000) in respect of the Group's share of associated undertakings' net interest. 5 Taxation includes overseas taxation of Â£1,339,000 (2001 six months: Â£2,076,000 - year: Â£3,400,000) and share of associated undertakings' taxation charge of Â£1,306,000 (2001 six months: Â£1,545,000 - year: Â£2,348,000). Overseas taxation for the year ended 31st December 2001 includes a credit of Â£1,303,000 arising from the recognition of a deferred tax asset related to losses which had not been previously recognised. Effective tax rates at the half-year are high due to losses recorded in overseas companies for which no offset can be recognised. 6 Dividends Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 Interim of 20p per share (2001: 20p) 532 544 544 Final for 2001 of 65p per share - - 1,759 532 544 2,303 7 The calculation of earnings per share is based on attributable (loss)/profit divided by the weighted average of ordinary shares in issue which was 2,660,540 (2001 six months: 2,733,257 - year: 2,731,019). 8 Included in cash at banks and in hand of Â£172,178,000 (2001 six months: Â£165,487,000 - year: Â£164,493,000) are cash and short-term funds, time deposits with banks and building societies and certificates of deposit amounting to Â£160,033,000 (2001 six months: Â£147,321,000 - year: Â£147,689,000), which are held by banking subsidiaries and which are an integral part of the banking operations of the Group. 9 Reconciliation of operating (loss)/profit to net cash flow from operating activities Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 Operating (loss)/profit (1,914) 2,708 11,904 Depreciation 4,372 4,486 8,731 Amortisation of goodwill (190) (55) (342) Profit on sale of fixed assets (95) (102) (120) Decrease in working capital 12,203 4,766 10,022 Net increase in funds of banking Subsidiaries (12,344) (5,798) (6,166) Currency adjustment 1,211 383 (1,996) Net cash flow from operating activities 3,243 6,388 22,033 10 Reconciliation of net cash flow to movements in net debt Six months Six months Year ended ended ended 30th June 30th June 31st December 2002 2001 2001 Â£'000 Â£'000 Â£'000 (Decrease)/increase in cash in the period (4,008) 184 (537) Cash inflow from changes in debt and financing (2,718) (4,640) (1,969) Change in net debt resulting from cash flows (6,726) (4,456) (2,506) Businesses acquired and sold 666 (385) 407 New finance leases - - (498) Translation differences (944) 188 987 Change in net debt in the period (7,004) (4,653) (1,610) Net debt at beginning of period (49,038) (47,428) (47,428) Net debt at end of period (56,042) (52,081) (49,038) 11. Preparation of interim results The financial statements have been prepared on the basis of the accounting policies set out in the report and accounts for the year ended 31st December 2001, except that Financial Reporting Standard 19 'Deferred Tax' has been adopted. The new accounting policy for deferred tax is as follows: Deferred tax is recognised as an asset or liability, at appropriate rates, in respect of transactions and events recognised in the financial statements of the current and previous periods which gives a right to pay less, or an obligation to pay more, in future tax periods. Deferred tax assets are only recognised to the extent it is probable that there will be suitable taxable profits from which they can be recovered. No provision is made for any taxation that could arise from the future disposal of any fixed assets shown in the accounts at valuation. Long-term deferred tax balances are not discounted. In order to conform with the requirements of FRS19 'Deferred Tax' the net assets at 30th June 2001 and 31st December 2001 have been adjusted to include an additional provision of Â£7,688,000 and Â£5,971,000 respectively. The tax charge has been reduced in the six months ended 30th June 2001 and the year ended 31st December 2001 by Â£296,000 and Â£2,139,000 respectively and the minority interests share of profit after tax has been increased in the six months ended 30th June 2001 and the year ended 31st December 2001 by Â£126,000 and Â£863,000 respectively. The six months figures are unaudited and have not been reviewed by the company's auditors. The figures for the year ended 31st December 2001 are an abridged statement from the Group accounts at that date which have been delivered to the Registrar of Companies. The Auditors' Report on these accounts was unqualified. The Interim Report will be posted to shareholders on 27th September 2002 on which date copies can be obtained from the Company's Registrars:- Capita IRG Plc, Balfour House, 390/398 High Road Ilford, Essex IG1 1NQ or from the company's registered office:- Wrotham Place Wrotham Sevenoaks Kent TN15 7AE Press enquiries to: Mr. M.C. Perkins Telephone No. 01622 746655 This information is provided by RNS The company news service from the London Stock Exchange

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