Origin Enterprises plc
INTERIM RESULTS STATEMENT
An encouraging start to trading in seasonally quiet first half
Origin Enterprises plc ('Origin' or 'the Group'), today announces its interim results for the half year ended 31 January 2017.
· Improved first half performance in seasonally quiet trading period
· More stable near term planning environment for primary producers, combined with generally settled weather, has driven good early season demand for agronomy services and inputs
· Solid foundation established for seasonally important second half with cropping base consistent with prior year
· Agreement to acquire the fertiliser blending and nutrition business of Bunn Fertiliser in the UK
· Commencement of a five year collaborative research partnership with University College Dublin to build digitally based agronomy advisory tools
· Origin separately announced today the acquisition of the digital agricultural services group - Resterra
· Interim dividend of 3.15 cent per share (2016: 3.15 cent per share)
Results Summary |
6 months ended 31 Jan 2017 €'000 |
6 months ended 31 Jan 2016 €'000 |
|
Change €'000 |
Group revenue |
564,436 |
507,213 |
|
57,223 |
Group operating profit/(loss) |
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|
- Operating profit/(loss) - Agri-Services* |
2,010 |
(1,790) |
|
3,800 |
- Associates and joint venture** |
1,742 |
1,476 |
|
266 |
Total group operating profit/(loss)* |
3,752 |
(314) |
|
4,066 |
Finance cost, net |
(3,816) |
(3,769) |
|
(47) |
Loss before tax* |
(64) |
(4,083) |
|
4,019 |
Basic loss per share (cent) |
(8.09) |
(5.24) |
|
(2.85) |
Adjusted diluted earnings/(loss) per share (cent)*** |
0.25 |
(2.47) |
|
2.72 |
Group net debt**** |
161,584 |
168,272 |
|
(6,688) |
Interim dividend per ordinary share (cent) |
3.15 |
3.15 |
|
- |
* Before amortisation of non-ERP intangible assets and exceptional items
** Profit after interest and tax
*** Before amortisation of non-ERP intangible assets, net of related deferred tax (2017: €2.0 million, 2016: €3.5 million) and exceptional items, net of tax (2017: €8.5 million, 2016: €Nil)
**** Includes restricted cash of €Nil (2016: €2.9m)
Origin Enterprises plc
Chief Executive Officer's comment:
Commenting on the results, Origin Chief Executive Officer, Tom O'Mahony said:
"The Group achieved good volume growth and margin recovery in the seasonally quiet first half of the financial year following a challenging trading year in 2016. Performance was supported by a more stable near term planning environment for primary producers together with the benefit of generally settled weather, which led to increased on-farm activity throughout the period.
Our investment priorities for technology development and strategic acquisitions are focused on capturing growth opportunity in the provision of dynamic crop management systems that meet the requirements of today's primary producer as well as broadening new customer and service potential.
We remain focused on embedding strategic cost initiatives, working capital management and business integration. The consolidation of acquisitions completed in 2016 in the UK, Poland and Romania is progressing as planned. The performance in the period provides a solid foundation for the seasonally more important second half when over 90% of earnings are typically generated."
ENDS
Capital Markets Site Visit
Origin will host an analyst and institutional investor site visit to our Technology Centre in Throws Farm near Stansted, UK, on Wednesday 14 June 2017. Further information will be circulated in due course.
Conference Call
The results announcement is available on the Company website www.originenterprises.com. There will be a live conference call at 8.30am (GMT) today. To participate in this conference call, please dial the number below. Participants are requested to dial in 5 to 10 minutes prior to the scheduled start time.
Participant access numbers:
Ireland: |
Tel: |
+353 (0)1 247 6528 |
UK/International: |
Tel: |
+44 (0)20 3427 1919 |
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Confirmation Code: |
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9006163 |
Replay
A replay of this call will be available for seven days.
Replay Access Code: |
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9006163 |
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Replay Access Numbers: |
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Dublin: |
Tel: |
+353 (0)1 486 0902 |
UK/International: |
Tel: |
+44 (0)20 3427 0598 |
Enquiries
Origin Enterprises plc |
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Imelda Hurley |
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Chief Financial Officer |
Tel: |
+353 (0)1 563 4959 |
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Andrew Mills |
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Investor Relations Officer |
Tel: |
+353 (0)1 563 4900 |
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Goodbody (ESM Adviser) |
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Siobhan Wall |
Tel: |
+353 (0)1 641 6019 |
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Davy (Nominated Adviser) |
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Anthony Farrell |
Tel: |
+353 (0)1 614 9993 |
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Powerscourt |
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Jack Hickey (Ireland) |
Tel: |
+353 (0)83 448 8339 |
Rob Greening (UK) |
Tel: |
+44 207 250 1446 |
About Origin Enterprises plc
Origin Enterprises plc is a focused Agri-Services group providing specialist on-farm agronomy services and the supply of crop technologies and inputs. The Group has leading market positions in Ireland, the United Kingdom, Poland, Romania and Ukraine. Origin is listed on the ESM and AIM markets of the Irish and London Stock Exchanges.
ESM ticker symbol: OIZ
AIM ticker symbol: OGN
Website: www.originenterprises.com
Financial Review - Summary
|
6 months ended 31 Jan 2017 €'000 |
6 months ended 31 Jan 2016 €'000 |
|
|
|
Group revenue |
564,436 |
507,213 |
Operating profit/(loss)* |
2,010 |
(1,790) |
Associates and joint venture, net** |
1,742 |
1,476 |
Group operating profit/(loss)* |
3,752 |
(314) |
Finance cost, net |
(3,816) |
(3,769) |
Pre-tax loss |
(64) |
(4,083) |
Income tax credit |
373 |
974 |
Adjusted net profit/(loss) |
309 |
(3,109) |
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|
Adjusted diluted earnings/(loss) per share (cent)*** |
0.25 |
(2.47) |
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Adjusted net profit/(loss) reconciliation |
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Reported net loss |
(10,157) |
(6,578) |
Amortisation of non-ERP intangible assets |
2,307 |
4,131 |
Tax on amortisation of non-ERP related intangible assets |
(304) |
(662) |
Exceptional items, net of tax |
8,463 |
- - |
Adjusted net profit/(loss) |
309 |
(3,109) |
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|
|
Adjusted diluted earnings/(loss) per share (cent)*** |
0.25 |
(2.47) |
Origin delivered adjusted diluted earnings per share*** for the period of 0.25 cent compared to adjusted diluted loss per share of 2.47 cent in the corresponding period last year. On a like for like basis (excluding the impact of currency movements and acquisitions) the underlying increase was 3.24 cent. The Group's earnings profile is significantly weighted towards the second half of the financial year when over 90 per cent of earnings are typically generated.
Group revenue
Group revenue was €564.4 million compared to €507.2 million in the corresponding period, an increase of 11.3 per cent. On a like for like basis (excluding the impact of currency movements and acquisitions) revenues increased by €52.7 million (10.4 per cent), principally reflecting a combination of increased agronomy service revenue and crop input volumes partially offset by lower fertiliser prices and crop marketing prices and volumes. Underlying volume growth was 12.8 per cent in the period compared to the corresponding period last year.
Operating profit*
Operating profit* from the Agri-Services business was €2.0 million compared to a loss of €1.8 million in the corresponding period. On a like for like basis (excluding the impact of currency movements and acquisitions) the increase year on year was €3.7 million. The performance in the seasonally quiet first half of the year was mainly attributable to the benefit of higher agronomy service revenue and crop input volumes, together with improved margins.
Associates and joint venture**
Origin's share of the profit after interest and taxation from associates and joint venture increased by €0.2 million to €1.7 million.
Financing costs, net debt and working capital
Net finance costs amounted to €3.8 million, in line with the prior period, however average net debt amounted to €210.0 million compared to €166.0 million in the prior period. The movement is primarily due to the impact of the timing of the receipt of disposal proceeds in the comparative period. The net finance cost remained at prior period levels, despite the increase in average net debt, due to the reduced blended interest rates applying to the period's borrowings. Net debt at 31 January 2017 was €161.6 million***** compared with €168.3 million***** at 31 January 2016, and is 1.95 times EBITDA**** for the twelve months to 31 January 2017.
Following the seasonal investment in working capital, the net cash outflow from operating activities was €140.1 million (2016: €168.5 million). During the period there was an increase of €129.3 million in working capital (2016: €145.8 million), principally reflecting seasonal requirements.
Exceptional items
Exceptional items net of tax amounted to a charge of €8.5 million (2016: €Nil), primarily relating to restructuring costs in the UK.
Dividend
An interim dividend of 3.15 cent per share will be paid on 14 April 2017 to shareholders on the register on 31 March 2017.
* Operating profit/(loss) and Group operating profit/(loss) are stated before amortisation of non-ERP intangible assets and exceptional items
** Profit after interest and tax
*** Before amortisation of non-ERP intangible assets, net of related deferred tax (2017: €2.0 million, 2016: €3.5 million) and exceptional items, net of tax (2017: €8.5 million, 2016: €Nil)
**** Net debt/EBITDA ratio as per the requirements of the Group's syndicated bank loan agreement
***** Includes restricted cash of €Nil (2016: €2.9 million)
Review of Operations
Agri-Services
|
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Change on prior period |
|
|
2017 €m |
2016 €m |
Change €m |
Underlying** €m |
Revenue |
564.4 |
507.2 |
57.2 |
52.7 |
|
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|
|
|
Operating profit/(loss)* |
2.0 |
(1.8) |
3.8 |
3.7 |
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* Before amortisation of non-ERP intangible assets and exceptional items
** Excluding the impact of currency movements and acquisitions
Revenue from Agri-Services comprises the totality of Group revenue. It incorporates integrated agronomy and on-farm services and business-to-business agri-inputs. During the period the Group's operations spanned Ireland, the UK, Poland, Romania and Ukraine.
Revenue and operating profit were €564.4 million and €2.0 million, respectively. On a like for like basis, excluding the impact of currency movements and acquisitions, revenue and operating result increased by €52.7 million and €3.7 million, respectively. This was due to a combination of higher agronomy service revenue, crop input volumes and improved margins, partially offset by lower fertiliser prices and crop marketing prices and volumes.
Ireland and the United Kingdom
Underlying volume growth was 12.6 per cent in the period compared to the corresponding period last year. A more favourable short term outlook for farm incomes is principally reflecting the positive impact on output prices of sterling weakness and tighter global dairy supply. This, together with generally settled autumn and winter weather supporting good crop establishment, drove good early season demand in advance of the main application period in the second half.
Integrated On-Farm Agronomy Services
Origin's agronomy services brand is Agrii, which specialises in offering independent and innovative advice, crop inputs and services to arable, fruit and vegetable growers in the UK.
Agrii performed very satisfactorily in the period achieving volume growth and margin recovery across all service and input portfolios.
On-farm activity was robust in the period, with the planted area for the principal autumn and winter crops at 2.95 million hectares compared with 2.96 million hectares for the comparative period. In the case of winter wheat there is an estimated 1.4 per cent increase in plantings to 1.85 million hectares. Winter oil seed rape sowings are currently estimated at 0.5 million hectares which represents a reduction of approximately 10 per cent on last year, largely due to agronomic and rotational crop planning decisions. The total planted area for spring crops is expected to be approximately 1.4 million hectares, compared to 1.3 million in the prior period.
The business has continued to prioritise its performance improvement agendas together with embedding strategic cost initiatives throughout its operations.
Business-to-Business Agri-Inputs
Business-to-Business Agri-Inputs delivered a good result in the period, with an improved performance principally underpinned by year-on-year growth in fertiliser volumes in the UK.
Fertiliser
The Group's fertiliser brands comprise Goulding in Ireland and Origin Fertilisers in the UK.
Against the backdrop of highly competitive trading conditions, the business recorded higher volumes and improved margins in the UK in the period. Strong early season demand reflected greater certainty in fertiliser raw material pricing which provided confidence to primary producers to fix a proportion of their nutrition requirements ahead of the main application period in the second half of the financial year.
Performance in Ireland was satisfactory during the seasonally quiet period for the business.
We anticipate higher market volumes for the year as a whole with application expected to be positively influenced by higher livestock numbers and improved returns for primary dairy producers.
Amenity
Origin Amenity addresses the maintenance and improvement requirements of the professional sports turf, landscaping and amenity sectors in the UK. It comprises the advisory and input service brands of Rigby Taylor and Headland Amenity, together with the PB Kent portfolio of specialist nutrition applications.
Origin Amenity delivered a good performance in the period, underpinned by further development momentum within the professional sports channel. Headland Amenity, which was acquired in 2016, is performing in line with expectations and the integration progressing as planned.
Feed Ingredients
Feed Ingredients achieved a satisfactory result in the period underpinned by a stable volume performance. Spot demand was generally robust throughout the period while currency volatility impacted customer forward buying momentum.
Central and Eastern Europe
Underlying volume growth was 13.6 per cent in the period compared to the corresponding period last year. Overall there was a satisfactory performance in the seasonally quiet trading period, with good early season momentum in the case of value added crop technologies. Sentiment on-farm is generally cautious as a result of the challenging year experienced by primary producers in 2016. A more concentrated or just-in-time demand profile for services and inputs is anticipated in the second half of the financial year.
Poland
The Group's Polish farm services business, Agrii, performed satisfactorily against lower demand in the period reflecting the impact of a very difficult growing season in 2016 and delayed autumn harvest conditions. The integration of the Kazgod Group, acquired in November 2015, is substantially complete with strong progress achieved to date in relation to customer channel and service portfolio alignment. Autumn and winter crop plantings are equivalent to last year at approximately 5.3 million hectares with no significant establishment issues arising at this stage.
The expansion of Agrii's seed processing and input formulation capacity commenced during the period. This €6 million capital project is expected to be operational early in the 2018 financial year.
Romania
The Group's Romanian operations, comprising the farm service brands of Comfert and Redoxim delivered a very satisfactory result in the period. Performance reflected increased volumes supported by new customer gains together with the benefit of higher margins.
Autumn and winter crop establishment is generally satisfactory against the backdrop of weather related delays to cereal and oil seed rape plantings which is expected to result in a larger area devoted to spring cropping this year. Total plantings for the principal winter crops are estimated at 3.30 million hectares compared with 3.25 million hectares last year. Total oil seed rape plantings are estimated at 600,000 hectares compared with 380,000 hectares for the comparative period.
Integration is progressing to plan with the primary focus concentrated on the development of enhanced technical sales support together with the further development of trial demonstration farms and knowledge transfer infrastructure.
Ukraine
The Group's Ukrainian farm services platform, Agroscope International, achieved higher revenues and margins in the period with performance principally underpinned by good momentum in the sale of value added technologies.
Autumn and winter crop plantings are estimated at 7.6 million hectares compared with 5.8 million hectares last year. Crops are generally well established and in good condition. Total crop plantings for the 2017 production year are expected to be in line with last year at 22.0 million hectares, approximately.
The financing environment for primary producers is currently more favourable and is generally reflective of an improved macro-economic backdrop.
Associates and joint venture
John Thompson & Sons Limited ('John Thompson')
John Thompson, the largest single site multi species animal feed mill in the European Union, in which Origin has a 50 per cent shareholding, delivered a satisfactory result in the period.
Other Group developments
On 12 December 2016, the Group announced the establishment of a dedicated digital, precision agriculture and crop science research partnership with University College Dublin ('UCD'), supported by Science Foundation Ireland ('SFI'). The five year development programme underpinning the research partnership will be financed by a €17.6 million investment which is co-funded by Origin and SFI. The collaboration encompasses a strong multi and inter-disciplinary approach, combining the expertise of UCD in data science and agricultural science with Origin's integrated crop management research and data, system capabilities and extensive on-farm knowledge exchange networks. The aim of the programme is to build digitally based and user driven advisory tools that provide rapid and localised decision support for agronomists and farmers.
Separately, Origin announced today the acquisition of the digital agricultural services group, the Resterra Group ('Resterra'). Under the terms of the transaction, Origin has acquired 100 per cent of the share capital of Resterra, on a debt free cash free basis, for consideration of £11.4 million. Additional contingent deferred consideration of up to £4.8 million will be payable upon the achievement of specific profit targets. Resterra specialises in the delivery of bespoke precision agronomy applications and is a leading provider of agri-tech services to primary producers, input manufacturers and agri-service companies to create, automate and systemise information access for rapid decision making. Resterra will enhance Origin's service capability in existing and wider geographies in addition to strongly complementing the work of the Origin-UCD collaborative partnership.
On 7 March 2017, Origin announced that it had reached agreement to acquire the fertiliser activities and certain assets of Bunn Fertiliser Limited in the UK ('Bunn') based on an enterprise value consideration of £18.2 million. Bunn is a leading provider of prescription fertiliser blends and nutrition management systems servicing arable, grassland and horticultural sectors. The transaction extends Origin's existing fertiliser blending activities, as well as its customer service capabilities, and will enable the Group to optimise operational and logistical efficiencies. The acquisition is subject to a number of conditions including clearance from the Competition and Markets Authority in the UK.
Outlook
The Group is well positioned to respond to current market conditions, and the encouraging start to the seasonally quiet first half provides a good foundation for the seasonally more important second half of the financial year when over 90 per cent of earnings typically arise.
A further update will be provided at the timing of the announcement of the third quarter Trading Update on 25 May 2017.
ENDS
Origin Enterprises plc
Condensed Interim Consolidated Income Statement
for the six months ended 31 January 2017
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Six months |
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ended |
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Six months |
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Six months |
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Six months |
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Year |
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January |
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ended |
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ended |
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ended |
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ended |
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2017 |
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January |
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January |
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January |
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July |
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Pre- |
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2017 |
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2017 |
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2016 |
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2016 |
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Exceptional |
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Exceptional |
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Total |
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Total |
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Total |
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€'000 |
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€'000 |
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€'000 |
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€'000 |
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€'000 |
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Notes |
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(Note 4) |
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(Note 6) |
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(Note 6) |
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Revenue |
3 |
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564,436 |
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- |
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564,436 |
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507,213 |
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1,521,256 |
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Cost of sales |
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(493,556) |
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- |
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(493,556) |
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(438,477) |
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(1,300,712) |
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Gross profit |
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70,880 |
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- |
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70,880 |
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68,736 |
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220,544 |
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Operating costs |
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(71,177) |
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(10,378) |
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(81,555) |
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(74,657) |
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(152,625) |
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Share of profit of associates and joint venture |
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1,742 |
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- |
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1,742 |
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1,476 |
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5,621 |
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Operating profit/(loss) |
3 |
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1,445 |
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(10,378) |
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(8,933) |
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(4,445) |
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73,540 |
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Finance income |
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262 |
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- |
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262 |
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273 |
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453 |
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Finance expense |
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(4,078) |
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- |
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(4,078) |
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(4,042) |
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(7,820) |
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(Loss)/profit before income tax |
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(2,371) |
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(10,378) |
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(12,749) |
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(8,214) |
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66,173 |
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Income tax credit/(expense) |
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677 |
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1,915 |
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2,592 |
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1,636 |
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(8,372) |
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(Loss)/profit attributable to equity shareholders |
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(1,694) |
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(8,463) |
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(10,157) |
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(6,578) |
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57,801 |
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Six months |
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Six months |
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Year |
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ended |
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ended |
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ended |
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January 2017 |
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January 2016 |
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July 2016 |
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Basic (loss)/earnings per share 5 |
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(8.09c) |
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(5.24c) |
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46.03c |
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Diluted (loss)/earnings per share 5 |
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(8.06c) |
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(5.24c) |
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45.85c |
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Origin Enterprises plc
Condensed Interim Consolidated Statement of Comprehensive Income
for the six months ended 31 January 2017
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Six months |
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Six months |
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Year |
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ended |
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ended |
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ended |
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January |
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January |
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July |
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2017 |
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2016 |
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2016 |
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€'000 |
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€'000 |
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€'000 |
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(Loss)/profit for the period |
(10,157) |
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(6,578) |
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57,801 |
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Other comprehensive (expense)/income |
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|
|
Items that are not reclassified subsequently to the Group income statement: |
|
|
|
|
|
Group/Associate defined benefit pension obligations |
|
|
|
|
|
- remeasurements of Group's defined benefit pension schemes |
(777) |
|
(109) |
|
(4,881) |
- deferred tax effect of remeasurements |
193 |
|
81 |
|
926 |
- share of remeasurements on associate's defined benefit pension schemes |
(3,058) |
|
(372) |
|
(356) |
- share of deferred tax effect of remeasurements- associates |
551 |
|
74 |
|
71 |
|
|
|
|
|
|
Items that may be reclassified subsequently to the Group income statement: |
|
|
|
|
|
Group foreign exchange translation details |
|
|
|
|
|
- exchange difference on translation of foreign operations |
(2,489) |
|
(13,987) |
|
(29,008) |
|
|
|
|
|
|
Group/Associate cash flow hedges |
|
|
|
|
|
- effective portion of changes in fair value of cash flow hedges |
1,566 |
|
2,205 |
|
1,633 |
- fair value of cash flow hedges transferred to operating costs |
(1,721) |
|
(847) |
|
(473) |
- deferred tax effect of cash flow hedges |
95 |
|
(356) |
|
(243) |
- share of associates and joint venture cash flow hedges |
(1,372) |
|
3,790 |
|
2,405 |
- deferred tax effect of share of associates and joint venture cash flow hedges |
171 |
|
(474) |
|
(301) |
|
|
|
|
|
|
Other comprehensive expense for the period, net of tax |
(6,841) |
|
(9,995) |
|
(30,227) |
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive (expense)/income for the period attributable to equity shareholders |
(16,998) |
|
(16,573) |
|
27,574 |
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Financial Position
as at 31 January 2017
|
|
January |
|
January |
|
July |
|
|
2017 |
|
2016 |
|
2016 |
|
Notes |
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
|
Property, plant and equipment |
7 |
103,151 |
|
108,178 |
|
102,796 |
Investment properties |
|
9,675 |
|
7,575 |
|
9,675 |
Goodwill and intangible assets |
8 |
188,973 |
|
181,557 |
|
192,696 |
Investments in associates and joint venture |
9 |
33,092 |
|
38,087 |
|
39,008 |
Other financial assets |
|
862 |
|
2,341 |
|
2,550 |
Derivative financial instruments |
|
168 |
|
- |
|
- |
Deferred tax assets |
|
7,132 |
|
4,391 |
|
7,376 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-current assets |
|
343,053 |
|
342,129 |
|
354,101 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
Inventory |
|
202,255 |
|
224,279 |
|
163,438 |
Trade and other receivables |
|
254,212 |
|
256,671 |
|
430,026 |
Derivative financial instruments |
|
1,077 |
|
2,145 |
|
1,337 |
Restricted cash |
|
- |
|
2,937 |
|
2,948 |
Cash and cash equivalents |
|
74,499 |
|
66,659 |
|
168,199 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
532,043 |
|
552,691 |
|
765,948 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
875,096 |
|
894,820 |
|
1,120,049 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Financial Position
as at 31 January 2017
|
|
|
January |
|
January |
|
July |
|
|
|
2017 |
|
2016 |
|
2016 |
|
Notes |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
EQUITY |
|
|
|
|
|
|
|
Called up share capital presented as equity |
12 |
|
1,264 |
|
1,264 |
|
1,264 |
Share premium |
|
|
160,399 |
|
160,399 |
|
160,399 |
Retained earnings and other reserves |
|
|
78,346 |
|
77,448 |
|
117,639 |
|
|
|
|
|
|
|
|
TOTAL EQUITY |
|
|
240,009 |
|
239,111 |
|
279,302 |
|
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
|
|
Interest-bearing borrowings |
|
|
217,363 |
|
218,620 |
|
159,124 |
Deferred tax liabilities |
|
|
18,597 |
|
18,037 |
|
19,109 |
Put option liability |
|
|
7,998 |
|
16,691 |
|
10,358 |
Provision for liabilities |
10 |
|
3,997 |
|
2,846 |
|
4,010 |
Post employment benefit obligations |
|
|
7,575 |
|
3,411 |
|
7,713 |
Derivative financial instruments |
|
|
100 |
|
1,407 |
|
628 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total non-current liabilities |
|
|
255,630 |
|
261,012 |
|
200,942 |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
Interest-bearing borrowings |
|
|
18,720 |
|
19,248 |
|
8,901 |
Trade and other payables |
|
|
343,140 |
|
349,281 |
|
604,404 |
Corporation tax payable |
|
|
8,343 |
|
17,830 |
|
16,140 |
Provision for liabilities |
10 |
|
8,071 |
|
7,914 |
|
9,768 |
Derivative financial instruments |
|
|
1,183 |
|
424 |
|
592 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
|
379,457 |
|
394,697 |
|
639,805 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
|
635,087 |
|
655,709 |
|
840,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
|
|
875,096 |
|
894,820 |
|
1,120,049 |
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Changes in Equity
for the six months ended 31 January 2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share- |
|
|
|
Foreign |
|
|
|
|
|
|
|
|
|
|
|
|
Capital |
|
Cashflow |
|
|
|
based |
|
|
|
currency |
|
|
|
|
|
|
Share |
|
Share |
|
Treasury |
|
redemption |
|
hedge |
|
Revaluation |
|
payment |
|
Re-organisation |
|
translation |
|
Retained |
|
|
|
|
capital |
|
premium |
|
shares |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
earnings |
|
Total |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 August 2016 |
1,264 |
|
160,399 |
|
(8) |
|
134 |
|
1,273 |
|
12,843 |
|
- |
|
(196,884) |
|
(27,402) |
|
327,683 |
|
279,302 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(10,157) |
|
(10,157) |
|
Other comprehensive expense for the period |
- |
|
- |
|
- |
|
- |
|
(1,261) |
|
- |
|
- |
|
- |
|
(2,489) |
|
(3,091) |
|
(6,841) |
|
Share-based payment charge |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
121 |
|
- |
|
- |
|
- |
|
121 |
|
Dividend paid to shareholders (Note 14) |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(22,416) |
|
(22,416) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 January 2017 |
1,264 |
|
160,399 |
|
(8) |
|
134 |
|
12 |
|
12,843 |
|
121 |
|
(196,884) |
|
(29,891) |
|
292,019 |
|
240,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Changes in Equity
for the six months ended 31 January 2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share- |
|
|
|
Foreign |
|
|
|
|
|
|
|
|
|
|
|
|
Capital |
|
Cashflow |
|
|
|
based |
|
|
|
currency |
|
|
|
|
|
|
Share |
|
Share |
|
Treasury |
|
redemption |
|
hedge |
|
Revaluation |
|
payment |
|
Re-organisation |
|
translation |
|
Retained |
|
|
|
|
capital |
|
premium |
|
shares |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
earnings |
|
Total |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 August 2015 |
1,264 |
|
160,399 |
|
(12) |
|
134 |
|
(1,748) |
|
12,843 |
|
1,749 |
|
(196,884) |
|
1,606 |
|
303,004 |
|
282,355 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(6,578) |
|
(6,578) |
|
Other comprehensive income/(expense) for the period |
- |
|
- |
|
- |
|
- |
|
4,318 |
|
- |
|
- |
|
- |
|
(13,987) |
|
(326) |
|
(9,995) |
|
Share-based payment credit |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(300) |
|
- |
|
- |
|
- |
|
(300) |
|
Dividend paid to shareholders (Note 14) |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(26,371) |
|
(26,371) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 January 2016 |
1,264 |
|
160,399 |
|
(12) |
|
134 |
|
2,570 |
|
12,843 |
|
1,449 |
|
(196,884) |
|
(12,381) |
|
269,729 |
|
239,111 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Cash Flows
for the six months ended 31 January 2017
|
Six months |
|
Six months |
|
Year |
|
ended |
|
ended |
|
ended |
|
January 2017 |
|
January 2016 |
|
July 2016 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
|
(Loss)/profit before tax |
(12,749) |
|
(8,214) |
|
66,173 |
Exceptional items |
10,378 |
|
- |
|
(4,955) |
Finance income |
(262) |
|
(273) |
|
(453) |
Finance expense |
4,078 |
|
4,042 |
|
7,820 |
Profit on disposal of property, plant and equipment |
(132) |
|
(16) |
|
(143) |
Share of profit of associates and joint venture |
(1,742) |
|
(1,476) |
|
(5,621) |
Depreciation of property, plant and equipment |
3,378 |
|
3,248 |
|
7,073 |
Amortisation of intangible assets |
3,597 |
|
5,368 |
|
6,800 |
Employee share-based payment charge/(credit) |
121 |
|
(300) |
|
(300) |
Pension contributions in excess of service costs |
(821) |
|
(4,158) |
|
(3,978) |
Payment of exceptional rationalisaton costs |
(8,331) |
|
(7,256) |
|
(7,202) |
Payment of employment related incentive costs |
- |
|
(8,600) |
|
(9,312) |
Payment of exceptional acquisition costs |
(275) |
|
(658) |
|
(1,392) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash flow before changes in working capital |
(2,760) |
|
(18,293) |
|
54,510 |
Increase in inventory |
(40,980) |
|
(55,622) |
|
(3,610) |
Decrease/(increase) in trade and other receivables |
171,455 |
|
143,413 |
|
(60,368) |
(Decrease)/increase in trade and other payables |
(259,751) |
|
(233,550) |
|
43,328 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash (absorbed)/generated from operating activities |
(132,036) |
|
(164,052) |
|
33,860 |
Interest paid |
(2,817) |
|
(2,727) |
|
(6,575) |
Income tax paid |
(5,222) |
|
(1,714) |
|
(11,635) |
|
|
|
|
|
|
|
|
|
|
|
|
Cash (outflow)/inflow from operating activities |
(140,075) |
|
(168,493) |
|
15,650 |
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Condensed Interim Consolidated Statement of Cash Flows
for the six months ended 31 January 2017
|
Six months |
|
Six months |
|
Year |
|
ended |
|
ended |
|
ended |
|
January 2017 |
|
January 2016 |
|
July 2016 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
|
Proceeds from sale of property, plant and equipment |
225 |
|
169 |
|
1,133 |
Proceeds from sale of equity investment |
- |
|
- |
|
1,051 |
Purchase of property, plant and equipment |
(3,794) |
|
(4,147) |
|
(6,789) |
Additions to intangible assets |
(857) |
|
(537) |
|
(1,640) |
Arising on acquisitions |
(956) |
|
(56,575) |
|
(62,461) |
Payment of put option liability |
(1,746) |
|
- |
|
- |
Payment of contingent acquisition consideration |
(3,015) |
|
- |
|
(1,000) |
Restricted cash |
2,948 |
|
26,421 |
|
26,410 |
Investment in associates and joint venture |
- |
|
(172) |
|
(164) |
Dividends received from associates |
3,697 |
|
2,936 |
|
2,942 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash outflow from investing activities |
(3,498) |
|
(31,905) |
|
(40,518) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
|
Drawdown of bank loans |
64,050 |
|
95,348 |
|
47,234 |
Bank overdraft arising on acquisition |
- |
|
(10,108) |
|
(10,108) |
Payment of dividends to equity shareholders (Note 14) |
(22,416) |
|
(26,371) |
|
(30,327) |
Increase/(decrease) of finance lease obligations |
67 |
|
114 |
|
(22) |
|
|
|
|
|
|
|
|
|
|
|
|
Cash inflow from financing activities |
41,701 |
|
58,983 |
|
6,777 |
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
(101,872) |
|
(141,415) |
|
(18,091) |
|
|
|
|
|
|
Translation adjustment |
(1,610) |
|
(2,865) |
|
(14,255) |
|
|
|
|
|
|
Cash and cash equivalents at start of period |
159,457 |
|
191,803 |
|
191,803 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of period (Note 11) |
55,975 |
|
47,523 |
|
159,457 |
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Notes to the Condensed Interim Consolidated Financial Statements
for the six months ended 31 January 2017
1 Basis of preparation
The Group condensed interim consolidated financial statements has been prepared in accordance with International Accounting Standard 34, Interim Financial Reporting (IAS 34), as endorsed by the EU. The condensed interim consolidated financial statements have been prepared as information for the shareholders and do not include all the information and disclosures required in the annual financial statements. They should be read in conjunction with the Group's annual financial statements in respect of the year ended 31 July 2016, which have been prepared in accordance with IFRSs. The financial statements for the year ended 31 July 2016 are available on the company's website www.originenterprises.com. Those financial statements contained an unqualified audit report.
The Goup condensed interim consolidated financial statements for the six months ended 31 January 2017 and the comparative figures for the six months ended 31 January 2016 are unaudited and have not been reviewed by the Auditors. The summary financial statements for the year ended 31 July 2016 represents an abbreviated version of the Group's full accounts for that year.
The Group condensed interim consolidated financial statements are presented in euro and rounded to the nearest thousand, which is the functional currency of the parent.
A comprehensive review of the Group's performance for the six months ended 31 January 2017 is included in the financial highlights section included on pages 5 to 10. The group's business is seasonal and is heavily weighted towards the second half of the financial year.
2 Accounting policies
Except as described below, the Group interim financial statements have been prepared on the basis of the accounting policies as set out on pages 64 to 69 of the Group's Annual Report for the year ended 31 July 2016.
The following amendments, issued by the International Accounting Standards Board ('IASB') and the International Financial Reporting Interpretations Committee ('IFRIC'), are effective for the Group for the first time in the current financial period and where relevant have been adopted by the Group:
· Annual improvements 2012-2014 cycle;
· Amendment to IFRS 10 "Consolidated financial statements";
· Amendment to IFRS 11 "Joint arrangements";
· Amendment to IFRS 12 "Disclosure of interests in other entities";
· Amendment to IAS 1 "Presentation of financial statements";
· Amendment to IAS 16 "Property, plant and equipment";
· Amendment to IAS 27 "Separate financial statements";
· Amendment to IAS 28 "Investment in associates";
· Amendment to IAS 38 "Intangible assets".
The above amendments are effective for accounting periods beginning on or after 1 January 2016.
Adoption of the standards above has had no significant impact on the results or financial position of the Group during the period.
The Group has not applied early adoption of any standards for which the effective date is not yet required.
3 Segment information
IFRS 8, 'Operating Segments', requires operating segments to be identified on the basis of internal reports that are regularly reviewed by the Chief Operating Decision Maker ('CODM') in order to allocate resources to the segments and to assess their performance. Two operating segments have been identified: Agri-Services and Associates and Joint Venture.
Origin's Agri-Services segment comprises integrated agronomy services and agri-inputs. The Associates and Joint Venture operating segment is comprised of the feed ingredient businesses.
Information regarding the results of each reportable segment is included below. Performance is measured based on segment operating profit as included in the internal management reports that are reviewed by the Group's CODM, being the Origin Executive Directors. Segment operating profit is used to measure performance, as this information is the most relevant in evaluating the results of the Group's segments.
(i) |
Segment revenue and result |
Agri-Services |
|
Associates & Joint Venture |
|
Total Group |
||||||
|
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
|
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
564,436 |
|
507,213 |
|
142,786 |
|
154,665 |
|
707,222 |
|
661,878 |
|
Less revenue from associates and joint venture |
- |
|
- |
|
(142,786) |
|
(154,665) |
|
(142,786) |
|
(154,665) |
|
Revenue |
564,436 |
|
507,213 |
|
- |
|
- |
|
564,436 |
|
507,213 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment result |
2,010 |
|
(1,790) |
|
1,742 |
|
1,476 |
|
3,752 |
|
(314) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortisation of non-ERP intangible assets |
|
|
|
|
|
|
|
|
(2,307) |
|
(4,131) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit/(loss) before exceptional items |
|
|
|
|
|
|
|
|
1,445 |
|
(4,445) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Exceptional loss |
|
|
|
|
|
|
|
|
(10,378) |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
|
|
|
|
|
|
|
(8,933) |
|
(4,445) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(ii) Segment earnings before financing costs and tax is reconciled to reported loss before tax and loss after tax as follows:
|
Six months |
|
Six months |
|
ended |
|
ended |
|
31/01/17 |
|
31/01/16 |
|
€'000 |
|
€'000 |
|
|
|
|
Segment earnings before financing cost and tax |
(8,933) |
|
(4,445) |
Finance income |
262 |
|
273 |
Finance expense |
(4,078) |
|
(4,042) |
|
|
|
|
Reported loss before tax |
(12,749) |
|
(8,214) |
|
|
|
|
Income tax credit |
2,592 |
|
1,636 |
|
|
|
|
Reported loss after tax |
(10,157) |
|
(6,578) |
|
(iii) Segment assets |
Agri-Services |
|
Associates & Joint Venture |
|
Total Group |
||||||||
|
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
||
|
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
||
|
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
||
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Segment assets excluding investment in associates |
|
|
|
|
|
|
|
|
|
|
|
||
|
and joint venture and investment properties (including other financial assets) |
748,895 |
|
772,404 |
|
- |
|
- |
|
748,895 |
|
772,404 |
||
|
Investment in associates and joint venture |
|
|
|
|
|
|
|
|
|
|
|
||
|
(including other financial assets) |
- |
|
- |
|
33,650 |
|
38,709 |
|
33,650 |
|
38,709 |
||
|
Segment assets |
748,895 |
|
772,404 |
|
33,650 |
|
38,709 |
|
782,545 |
|
811,113 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Reconciliation to total assets as reported in Condensed Interim Consolidated Statement of Financial Position |
||||||||||||||
|
Cash and cash equivalents |
|
|
|
|
|
|
|
|
74,499 |
|
66,659 |
||
|
Restricted cash |
|
|
|
|
|
|
|
|
- |
|
2,937 |
||
|
Investment properties |
|
|
|
|
|
|
|
|
9,675 |
|
7,575 |
||
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
1,245 |
|
2,145 |
||
|
Deferred tax assets |
|
|
|
|
|
|
|
|
7,132 |
|
4,391 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Total assets as reported in Condensed Interim Consolidated Statement of Financial Position |
|
|
|
|
|
|
|
|
875,096 |
|
894,820 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
(iv) Segment liabilities |
Agri-Services |
|
Associates & Joint Venture |
|
Total Group |
||||||||
|
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
|
Six months |
||
|
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
|
ended |
||
|
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
|
31/01/17 |
|
31/01/16 |
||
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
||
|
Segment liabilities |
370,781 |
|
380,143 |
|
- |
|
- |
|
370,781 |
|
380,143 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
Reconciliation to total liabilities as reported in Condensed Interim Consolidated Statement of Financial Position |
||||||||||||||
|
Interest-bearing loans and liabilities |
|
|
|
|
|
|
|
|
236,083 |
|
237,868 |
||
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
1,283 |
|
1,831 |
||
|
Current and deferred tax liabilities |
|
|
|
|
|
|
|
|
26,940 |
|
35,867 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
Total liabilities as reported in Condensed Interim Consolidated Statement of Financial Position |
|
|
|
|
|
|
|
|
635,087 |
|
655,709 |
||
|
|
|
|
|
|
|
|
|
|
|
|
|
||
4 Exceptional items
Exceptional items are those that, in management's judgement, should be disclosed separately by virtue of their nature or amount. Such items are included within the consolidated income statement caption to which they relate. The following exceptional items arose in the period:
|
Six months |
|
Six months |
|
ended |
|
ended |
|
January |
|
January |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
Rationalisation and other costs (i) |
8,115 |
|
- |
Transaction costs (ii) |
348 |
|
- |
|
|
|
|
Total exceptional charge, net of tax |
8,463 |
|
- |
(i) Rationalisation costs primarily comprise termination payments arising from a restructuring of Agri-Services in the UK. The tax impact of this exceptional item in the current period is a tax credit of €1.9 million.
(ii) Transaction costs principally consist of acquisition related costs incurred.
5 (Loss)/earnings per share
Basic loss per share
|
Six months |
|
Six months |
|
ended |
|
ended |
|
January |
|
January |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
Loss for the financial period attributable to equity shareholders |
(10,157) |
|
(6,578) |
|
|
|
|
|
'000 |
|
'000 |
|
|
|
|
Weighted average number of ordinary shares for the period |
125,578 |
|
125,578 |
|
|
|
|
|
Cent |
|
Cent |
|
|
|
|
Basic loss per share |
(8.09) |
|
(5.24) |
Diluted loss per share
|
Six months |
|
Six months |
|
ended |
|
ended |
|
January |
|
January |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
Loss for the financial period attributable to equity shareholders |
(10,157) |
|
(6,578) |
|
|
|
|
|
'000 |
|
'000 |
|
|
|
|
Weighted average number of ordinary shares used in basic calculation |
125,578 |
|
125,578 |
Impact of SAYE scheme |
495 |
|
- |
Weighted average number of ordinary shares (diluted) for the period |
126,073 |
|
125,578 |
|
|
|
|
|
Cent |
|
Cent |
|
|
|
|
Diluted loss per share |
(8.06) |
|
(5.24) |
Adjusted basic earnings/(loss) per share
|
|
|
|
|
|
Six months |
|
Six months |
|
|
|
|
|
|
ended |
|
ended |
|
|
|
|
|
|
January |
|
January |
|
|
|
|
|
|
2017 |
|
2016 |
|
|
|
|
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss for the financial period attributable to equity shareholders |
|
|
|
|
(10,157) |
|
(6,578) |
|
Amortisation of non-ERP related intangible assets |
|
|
|
|
2,307 |
|
4,131 |
|
Tax on amortisation of non-ERP related intangible assets |
|
|
|
|
(304) |
|
(662) |
|
Exceptional items, net of tax |
|
|
|
|
8,463 |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted basic earnings/(loss) |
|
|
|
|
309 |
|
(3,109) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cent |
|
Cent |
|
Adjusted basic earnings/(loss) per share |
|
|
|
|
0.25 |
|
(2.47) |
|
|
|
|
|
|
|
|
|
|
Adjusted diluted earnings/(loss) per share |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total adjusted basic earnings/(loss) - as above |
|
|
|
|
309 |
|
(3,109) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cent |
|
Cent |
|
Total adjusted diluted earnings/(loss) per share |
|
|
|
|
0.25 |
|
(2.47) |
|
|
|
|
|
|
|
|
|
The calculation of basic adjusted earnings/(loss) per share is based on the weighted average number of shares in issue during the period of 125,578,447 (31 January 2016: 125,578,447). The weighted average number of shares used in the calculation of adjusted diluted earnings/(loss) per share is 126,073,154 (31 January 2016: 125,578,447).
6 Condensed Interim Consolidated Income Statements for the six months ended 31 January 2016 and year ended 31 July 2016
An analysis of the Condensed Interim Consolidated Income Statement (including exceptional items) for the six months ended 31 January 2016 and year ended 31 July 2016 is set out below.
Six months ended 31 January 2016
|
|
|
Six months |
|
|
|
|
|
|
|
|
ended |
|
Six months |
|
Six months |
|
|
|
|
January |
|
ended |
|
ended |
|
|
|
|
2016 |
|
January |
|
January |
|
|
|
|
Pre- |
|
2016 |
|
2016 |
|
|
|
|
Exceptional |
|
Exceptional |
|
Total |
|
|
|
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
507,213 |
|
- |
|
507,213 |
|
|
Cost of sales |
|
(438,477) |
|
- |
|
(438,477) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
68,736 |
|
- |
|
68,736 |
|
|
|
|
|
|
|
|
|
|
|
Operating costs |
|
(74,657) |
|
- |
|
(74,657) |
|
|
Share of profit of associates and joint venture |
|
1,476 |
|
- |
|
1,476 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating loss |
|
(4,445) |
|
- |
|
(4,445) |
|
|
|
|
|
|
|
|
|
|
|
Finance income |
|
273 |
|
- |
|
273 |
|
|
Finance expense |
|
(4,042) |
|
- |
|
(4,042) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss before income tax |
|
(8,214) |
|
- |
|
(8,214) |
|
|
|
|
|
|
|
|
|
|
|
Income tax credit |
|
1,636 |
|
- |
|
1,636 |
|
|
|
|
|
|
|
|
|
|
|
Loss for the period |
|
(6,578) |
|
- |
|
(6,578) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year ended 31 July 2016
|
|
|
Year |
|
|
|
|
|
|
|
|
ended |
|
Year |
|
Year |
|
|
|
|
July |
|
ended |
|
ended |
|
|
|
|
2016 |
|
July |
|
July |
|
|
|
|
Pre- |
|
2016 |
|
2016 |
|
|
|
|
Exceptional |
|
Exceptional |
|
Total |
|
|
|
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue |
|
1,521,256 |
|
- |
|
1,521,256 |
|
|
Cost of sales |
|
(1,300,712) |
|
- |
|
(1,300,712) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
220,544 |
|
- |
|
220,544 |
|
|
|
|
|
|
|
|
|
|
|
Operating costs |
|
(157,580) |
|
4,955 |
|
(152,625) |
|
|
Share of profit of associates and joint venture |
|
5,621 |
|
- |
|
5,621 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit |
|
68,585 |
|
4,955 |
|
73,540 |
|
|
|
|
|
|
|
|
|
|
|
Finance income |
|
453 |
|
- |
|
453 |
|
|
Finance expense |
|
(7,820) |
|
- |
|
(7,820) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit before income tax |
|
61,218 |
|
4,955 |
|
66,173 |
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
(8,151) |
|
(221) |
|
(8,372) |
|
|
|
|
|
|
|
|
|
|
|
Profit for the year |
|
53,067 |
|
4,734 |
|
57,801 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
7 Property, plant and equipment
|
January |
|
July |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
Net book value |
|
|
|
At beginning of period |
102,796 |
|
97,889 |
Arising on acquisitions (Note 13) |
- |
|
14,804 |
Additions |
4,452 |
|
6,780 |
Disposals |
(93) |
|
(990) |
Depreciation charge |
(3,378) |
|
(7,073) |
Translation adjustments |
(626) |
|
(8,614) |
|
|
|
|
|
|
|
|
At end of period |
103,151 |
|
102,796 |
|
|
|
|
|
|
|
|
8 Goodwill and intangible assets
|
January |
|
July |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
Net book value |
|
|
|
At beginning of period |
192,696 |
|
161,401 |
Arising on acquisitions (Note 13) |
- |
|
51,216 |
Additions |
857 |
|
7,859 |
Amortisation of non-ERP intangible assets |
(2,307) |
|
(4,294) |
ERP intangible amortisation |
(1,290) |
|
(2,506) |
Translation adjustments |
(983) |
|
(20,980) |
|
|
|
|
|
|
|
|
At end of period |
188,973 |
|
192,696 |
|
|
|
|
Included in the total goodwill and intangible assets above is goodwill of €118,063,000 (July 2016: €111,274,000). There have been no indicators of impairment in the first half of the year therefore a full assessment of the carrying value of goodwill and intangibles will be carried out in the second half of the year.
9 Investments in associates and joint venture
|
January |
|
July |
|
2017 |
|
2016 |
|
€'000 |
|
€'000 |
|
|
|
|
At beginning of period |
39,008 |
|
38,537 |
Share of profits after tax |
1,742 |
|
5,621 |
Dividends received |
(3,697) |
|
(2,942) |
Share of other comprehensive(expense)/ income |
(3,708) |
|
1,819 |
Translation adjustments |
(253) |
|
(4,027) |
|
|
|
|
|
|
|
|
At end of period |
33,092 |
|
39,008 |
|
|
|
|
|
|
|
|
10 Provision for liabilities
The estimate of provisions is a key judgement in the preparation of the financial statements.
|
|
January |
|
July |
|
|||
|
|
2017 |
|
2016 |
|
|||
|
|
€'000 |
|
€'000 |
|
|||
|
|
|
|
|
|
|||
|
At beginning of period |
13,778 |
|
11,470 |
|
|||
|
Arising on acquisition |
- |
|
7,585 |
|
|||
|
Provided in period |
9,677 |
|
4,253 |
|
|||
|
Paid in period |
(11,346) |
|
(8,229) |
|
|||
|
Released in period |
- |
|
(210) |
|
|||
|
Translation adjustments |
(41) |
|
(1,091) |
|
|||
|
|
|
|
|
|
|||
|
|
|
|
|
|
|||
|
At end of period |
12,068 |
|
13,778 |
|
|||
|
|
|
|
|
|
|||
|
|
|
|
|||||
Provisions for liabilities relate to various operating and employment related costs and contingent acquisition consideration that arose on acquisitions during the prior year ended 31 July 2016.
11 |
Analysis of net debt |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
31 July |
|
|
|
Non-cash |
|
Translation |
|
31 January |
|
|
|
2016 |
|
Cash flow |
|
movements |
|
adjustment |
|
2017 |
|
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash |
168,199 |
|
(92,155) |
|
- |
|
(1,545) |
|
74,499 |
|
|
Overdraft |
(8,742) |
|
(9,717) |
|
- |
|
(65) |
|
(18,524) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
159,457 |
|
(101,872) |
|
- |
|
(1,610) |
|
55,975 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance lease obligations |
(358) |
|
(67) |
|
- |
|
10 |
|
(415) |
|
|
Loans |
(158,925) |
|
(64,050) |
|
(351) |
|
6,182 |
|
(217,144) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash/(debt)
|
174 |
|
(165,989) |
|
(351) |
|
4,582 |
|
(161,584) |
|
|
Restricted cash |
2,948 |
|
(2,948) |
|
- |
|
- |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net cash/(debt) including restricted cash |
3,122 |
|
(168,937) |
|
(351) |
|
4,582 |
|
(161,584) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
The loans included above are unsecured and the facility extends to May 2020.
12 |
Share capital |
January |
|
July |
|
|
2017 |
|
2016 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
Authorised |
|
|
|
|
250,000,000 ordinary shares of €0.01 each (i) |
2,500 |
|
2,500 |
|
|
|
|
|
|
Allotted, called up and fully paid |
|
|
|
|
126,378,777 ordinary shares of €0.01 each (i) |
1,264 |
|
1,264 |
(i) Ordinary shareholders are entitled to dividends as declared and each ordinary share carries equal voting rights at meetings of the Company.
13 Acquisition of subsidiary undertakings
During the prior year the Group completed a number of acquisitions in Romania and Poland, with additional bolt-on acquisitions in the United Kingdom. These acquisitions improved the strategic position of the Group's integrated agronomy services business and further the Group's focus on building new capability, systems and process development along with organisational simplification.
Details of the acquisitions are as follows:
(i) On 17 September 2015 the Group completed the acquisition of 100 per cent of Redoxim SRL. Based in Romania, Redoxim SRL is a leading provider of agronomy services, macro and micro inputs to arable, vegetable and horticulture growers.
(ii) On 23 November 2015 the Group completed the acquisition of 100 per cent of the Kazgod Group. Based in Poland, the Kazgod Group is a leading provider of agronomy services, inputs, crop marketing solutions as well as a manufacturer of micro nutrition applications.
(iii) On 16 December 2015 the Group completed the acquisition of 100 per cent of Comfert SRL. Based in Romania, Comfert SRL is a leading provider of agronomy services, integrated inputs and crop marketing support to arable and vegetable growers.
(iv) On 20 August 2015 the Group completed the acquisition of 100 per cent of ReSo Seeds Limited. Based in the United Kingdom, ReSo Seeds Limited is a leading mobile seed cleaning and processing specialist company.
(v) On 1 July 2016 the Group completed the acquisition of 100 per cent of Headland Amenity Limited. Based in the United Kingdom, Headland Amenity Limited is a technically advanced supplier of products and synergistic programmes to improve sports turf surfaces.
Subsequent to the finalisation of the consolidated financial statements that were issued on 27 September 2016, certain adjustments were identified to the initial fair value accounting of acquisitions that were completed during the twelve months ended 31 July 2016. In line with Group policy, any adjustments to the initial accounting for a business combination are recognised within twelve months of the acquisition date and are effected as if they were identified at the acquisition date.
These adjustments have been included in the comparative year end 31 July 2016 numbers presented in the Condensed Interim Consolidated Statement of Financial Position and the related notes therein and represent adjustments of the goodwill and trade and other payables balances.
Details of the net assets acquired and goodwill (excluding debt acquired) arising from the business combinations are as follows:
|
|
Fair |
|
|
value |
Assets |
|
€'000 |
Non-current |
|
|
Property, plant and equipment |
|
14,804 |
Intangible assets |
|
17,131 |
Other financial assets |
|
1,656 |
Deferred tax asset |
|
1,777 |
|
|
|
Total non-current assets |
|
35,368 |
|
|
|
Current assets |
|
|
Inventory |
|
23,682 |
Trade receivables |
|
73,627 |
Other receivables |
|
9,120 |
|
|
|
Total current assets |
|
106,429 |
|
|
|
Liabilities |
|
|
Trade and other payables |
|
(95,457) |
Finance lease obligation |
|
(250) |
Corporation tax |
|
(752) |
Deferred tax liability |
|
(2,650) |
|
|
|
Total liabilities |
|
(99,109) |
|
|
|
Total identifiable net assets at fair value |
|
42,688 |
Goodwill arising on acquisition |
|
34,085 |
Total net assets acquired (excluding debt acquired) |
|
76,773 |
|
|
|
Consideration satisfied by: |
|
|
Cash consideration |
|
45,605 |
Cash acquired |
|
(5,181) |
Net cash outflow |
|
40,424 |
|
|
|
Deferred consideration |
|
3,472 |
Contingent consideration |
|
4,113 |
|
|
|
Consideration |
|
48,009 |
Debt acquired |
|
28,764 |
|
|
|
|
|
|
Consideration plus debt acquired |
|
76,773 |
14 Dividends
On 18 December 2016 a final dividend of 17.85 cent per ordinary share was paid in respect of the year ended 31 July 2016 which when combined with the interim dividend of 3.15 cent per ordinary share brings the total dividend for the year ended 31 July 2016 to 21 cent per ordinary share.
An interim dividend of 3.15 cent (2016: 3.15 cent) per ordinary share will be paid on 14 April 2017 to shareholders on the register on 31 March 2017. These condensed interim consolidated financial statements do not reflect this dividend payable.
15 Taxation
The taxation expense for the interim period is an estimate based on the expected full year effective tax rate on full year profits.
16 Contingent liabilities
The Group is not aware of any major changes with regard to contingent liabilities in comparison with the situation as of 31 July 2016.
17 Financial commitments
The Group has a financial commitment of €8.8 million attributable to a strategic partnership with University College Dublin ('UCD'). The commitment is over a five year period.
18 Related party transactions
Related party transactions occurring in the period were similar in nature to those described in the 2016 Annual Report.
19 Release of half yearly condensed interim consolidated financial statements
The Group condensed interim consolidated financial information was approved for release by the Board on 8 March 2017.
20 Distribution of Interim Report
This interim report is available on the Group's website (www.originenterprises.com). A printed copy is available to the public at the Company's registered office.
21 Subsequent events
On 7 March 2017 Origin announced it had reached agreement to acquire the fertiliser activities and certain assets of Bunn Fertilisers Limited ('the transaction). Under the terms of the transaction, Origin will acquire the business on a debt free and cash free basis for a consideration of £14.2 million payable in cash on completion. The total enterprise value of the transaction inclusive of estimated average working capital is expected to be £18.2 million. Completion of the transaction is subject to a number of conditions including obtaining clearance from the Competition and Markets Authority in the United Kingdom.
On 9 March 2017 Origin announced that it had acquired the digital agricultural services group, the Resterra Group ('Resterra'). Under the terms of the transaction Origin has acquired 100 percent of Resterra, on a debt free cash free basis, for consideration of £11.4 million. Additional contingent deferred consideration of up to £4.8 million will be payable based upon the achievement of specific profit targets.