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OCEANA - AUDITED GROUP RESULTS AND DIVIDEND DECLARATION FOR THE YEAR ENDED 30
SEPTEMBER 2004
OCEANA GROUP LIMITED
JSE Share Code: OCE
NSX Share Code: OCG
ISIN Number: ZAE000025284
Incorporated in the Republic of South Africa
(Registration Number 1939/001730/06)
AUDITED GROUP RESULTS AND DIVIDEND DECLARATION FOR THE YEAR ENDED 30 SEPTEMBER
2004
The results of the group for the year ended 30 September 2004 are set out
herein.
The accounting policies used in preparing this report are consistent with those
used in the annual financial statements which have been prepared in accordance
with South African Statements of Generally Accepted Accounting Practice on a
basis consistent with the previous year, except as disclosed in note 1.
The financial information has been audited by Deloitte & Touche, whose
unqualified opinion is available for inspection at the registered office of the
company.
Oceana Group Limited
Registered Office: 16th Floor Metropolitan Centre, 7 Coen Steytler Avenue, Cape
Town 8001
Transfer Secretaries: Computershare Investor Services 2004 (Pty)Limited, 70
Marshall Street, Johannesburg 2001 (P O Box 61051, Marshalltown 2107).
Sponsor: Standard Bank
Directors : D M J Ncube (Chairman), R A Williams (Vice Chairman),
A B Marshall* (Chief Executive Officer), D F Behrens, M A Brey, B P Connellan, N
Dennis, R G Nicol*, S Pather, R V Smither. (*executive)
Company Secretary: JD Cole
GROUP INCOME STATEMENT
Audited
Audited Restated
2004 2003 Change
Note R"000 R"000 %
Revenue 1.2 2,487,502 2,517,418 (1)
Operating profit before abnormal items 221,483 267,072 (17)
Abnormal items 2 4,949 (180)
Operating profit 226,432 266,892
Dividends received 2,976 7,861
Net interest received 16,617 20,940
Profit before taxation 246,025 295,693 (17)
Taxation 78,522 101,393 (23)
Profit after taxation 167,503 194,300
Attributable to outside shareholders
in subsidiaries 3,123 5,579
_______ _______
Attributable to own shareholders 164,380 188,721 (13)
Number of shares in issue (000"s) 109,976 108,281
Weighted average number of shares on
which earnings per share and headline
earnings per share are based (000"s) 109,530 107,906
Adjusted weighted average number of shares
on which diluted earnings per share and
diluted headline earnings per share
are based (000"s) 111,670 111,073
Earnings per share (cents)
Basic 150.1 174.9 (14)
Diluted 147.2 169.9 (13)
Headline earnings per share (cents)
Basic 143.8 181.0 (21)
Diluted 141.1 175.9 (20)
Dividends per share (cents) 76.5 76.5 -
DETERMINATION OF HEADLINE EARNINGS
Attributable to own shareholders 164,380 188,721
Adjusted for:
- Impairment loss on property, plant
and equipment 160 6,885
- Impairment loss on fishing rights 0 2,243
- (Profit)/loss on change of interest
in subsidiary and joint ventures (416) 197
- Profit on disposal of property, plant
and equipment (6,567) (2,687)
Headline earnings for the year 157,557 195,359 (19)
STATEMENT OF CHANGES IN EQUITY
Audited
Share Non TOTAL
Capital distribut- Distribut- R"000
and able able
Premium Reserves Reserves
Note R"000 R"000 R"000
Balance at 30 September
2002
as previously reported 30,599 40,044 597,298 667,941
Change in accounting
policy
for share trust 1.1 (562) 0 1,471 909
Restated balance 30,037 40,044 598,769 668,850
Shares issued 2,811 0 0 2,811
Decrease in treasury
shares
held by share trust 46 0 0 46
Movement on foreign
currency translation 0 (17,547) 0 (17,547)
reserve
Net profit for the year 0 0 188,721 188,721
Profit on sale of treasury
Shares 0 0 343 343
Dividends 0 0 (74,361) (74,361)
Balance at 30 September 32,894 22,497 713,472 768,863
2003
Shares issued 8,630 0 0 8,630
Increase in treasury
shares
held by share trust (128) 0 0 (128)
Movement on foreign
currency translation 0 (9,567) 0 (9,567)
reserve
Net profit for the year 0 0 164,380 164,380
Profit on sale of treasury
Shares 0 0 250 250
Dividends 0 0 (83,815) (83,815)
Balance at 30 September 41,396 12,930 794,287 848,613
2004
GROUP BALANCE SHEET
Audited
Audited Restated
2004 2003
R"000 R"000
Assets
Non current assets 460,496 394,145
Property, plant and equipment 310,389 280,189
Goodwill 18,581 0
Fishing rights, trademarks 35,397 20,706
Deferred taxation 20,990 20,115
Investments and loans 75,139 73,135
Current assets 1,011,406 889,970
Inventories 309,288 193,091
Accounts receivable 502,380 452,751
Cash and cash equivalents 199,738 244,128
_________ _________
Total assets 1,471,902 1,284,115
Equity and liabilities
Capital and reserves 848,613 768,863
Share capital and premium 41,396 32,894
Non-distributable reserves 12,930 22,497
Distributable reserves 794,287 713,472
Interest of outside shareholders 14,577 14,211
Non-current liabilities
Deferred taxation 24,287 12,921
Current liabilities 584,425 488,120
Bank overdraft 82,283 39,088
Accounts payable and provisions 502,142 449,032
_________ _________
Total equity and liabilities 1,471,902 1,284,115
Net asset value per ordinary share (cents) 772 710
Total liabilities excl deferred tax:
Total shareholders"funds (%) 68 62
GROUP CASH FLOW STATEMENT
Audited
Audited Restated
2004 2003
R"000 R"000
Cash flows from operating activities
Operating profit before abnormal items 221,483 267,072
Adjustment for non cash items 57,822 56,092
Cash operating profit before working
capital changes 279,305 323,164
Working capital changes (55,860) (84,502)
Cash generated from operations 223,445 238,662
Interest and dividends received 23,876 35,782
Interest paid (4,283) (6,981)
Taxation paid (104,766) (100,270)
Dividends paid (86,464) (78,529)
Net cash flows from operating activities 51,808 88,664
Cash outflow from investing activities (156,561) (129,983)
Net cash outflow before financing activities (104,753) (41,319)
Net cash flows from financing activities 18,459 3,200
Net decrease in cash and cash equivalents (86,294) (38,119)
Increase/(decrease) in cash resulting from
acquisition/disposal of business 2,662 (2)
Cash and cash equivalents at the
beginning of the year 205,040 250,003
Effect of exchange rate changes (3,953) (6,842)
Cash and cash equivalents at the end of the year 117,455 205,040
SEGMENT REPORT
Audited
Audited Restated
2004 2003
R"000 R"000
Revenue
Inshore Fishing 1,240,929 1,197,289
Midwater and Deepsea Fishing 1,100,298 1,190,706
Commercial Cold Storage & Logistics 146,275 129,423
Total 2,487,502 2,517,418
Operating profit before abnormal items
Inshore Fishing 130,072 145,359
Midwater and Deepsea Fishing 44,590 80,070
Commercial Cold Storage & Logistics 46,821 41,643
Total 221,483 267,072
Total assets
Inshore Fishing 606,007 519,062
Midwater and Deepsea Fishing 385,718 295,074
Commercial Cold Storage & Logistics 184,310 132,601
Financing 274,877 317,263
1,450,912 1,264,000
Deferred taxation 20,990 20,115
Total 1,471,902 1,284,115
Total liabilities
Inshore Fishing 294,890 293,694
Midwater and Deepsea Fishing 117,850 71,820
Commercial Cold Storage & Logistics 89,402 83,518
Financing 82,283 39,088
584,425 488,120
Deferred taxation 24,287 12,921
Total 608,712 501,041
NOTES
Audited
Audited Restated
2004 2003
R"000 R"000
1. Change in accounting policies
1.1 In order to comply with JSE Securities
Exchange requirements, the group has changed
its policy regarding accounting for the Oceana
Group Share Trust, which has now been consolidated.
Financial statements for the prior year have
been restated accordingly. The main effects
of the change are set out below:
Dividends received as previously reported 9,646
Adjustments to include share trust (1,785)
As restated 7,861
Profit attributable to own shareholders
as previously reported 190,506
Adjustments to include share trust (1,785)
As restated 188,721
Prior year share capital and premium, number
of shares in issue, investments and loans and
accounts payable have been restated to take
into account the treasury shares held by the
share trust and to eliminate inter group balances
1.2 Revenue is now disclosed after deducting
normal rebates and discounts, which were pre-
viously included in cost of sales. The effect
of this change is set out below:
Revenue as previously reported 2,582,626
Less: discounts and rebates 65,208
As restated 2,517,418
Cost of sales as previously reported 1,752,280
Less: discounts and rebates 65,208
As restated 1,687,072
2. Abnormal items
Net profit on disposal of property, plant
and equipment 5,072 17
Loss on change of interest in joint ventures (123) (197)
Abnormal profit/(loss) before taxation 4,949 (180)
Taxation (88) 0
Abnormal profit/(loss) attributable to
own shareholders 4,861 (180)
3. Dividends
Dividend declared after reporting date 64,886 64,576
4. Supplementary information
Cost of sales 1,704,794 1,687,072
Depreciation 58,036 44,558
Amortisation of goodwill and other intangibles 1,190 2,247
Impairment loss on plant and equipment 228 7,860
Impairment loss on fishing rights 0 2,243
Operating lease charges 15,669 11,780
Foreign exchange(profit)/loss (5,488) 11,473
Capital expenditure 93,300 136,313
Expansion 57,144 94,000
Replacement 36,156 42,313
Capital commitments 70,908 130,279
Contracted 2,246 10,295
Approved 68,662 119,984
Contingent liabilities 0 1,489
5. Acquisition of Glenryck (UK) Limited
On 31 March 2004 the group acquired 100% of
the share capital of Glenryck (UK) Limited.
The acquisition cost was allocated as follows:
Shareholder"s loan 6,074
Net asset value 32,181
Trademark revaluation 15,643
Goodwill 19,279
73,177
COMMENTS
Financial Results
Headline earnings per share decreased by 21% compared to those of the previous
year. Group turnover declined by 1% and operating profit by 17%.
A final dividend of 59.0 cents per share has been declared, which together with
the interim dividend of 17.5 cents, brings the total dividend for the year to
76.5 cents per share (2003: 76.5 cents).
Review of operations
Pilchard landings to the cannery at St Helena Bay were higher. However
production yields declined due to smaller fish size and increased distance from
the fishing grounds. Sales volumes of canned fish on the domestic market
decreased significantly year on year as a result of extremely competitive market
conditions. The pilchard biomass in South African waters is considered to be
healthy and the Total Allowable Catch (TAC) in 2004 was finalised at 457 000
tons (2003: 285 000 tons).
The Namibian pilchard TAC was finalised at 25 000 tons (2003: 20 000 tons) most
of which was landed at Etosha.
The results of Glenryck UK were consolidated for the six months from date of
acquisition, 31 March 2004. The business performed well and provides an
important market for canned fish produced in South Africa and Namibia.
The contribution from fish meal improved on that of the previous year due to
higher production and sales volumes although selling prices were lower.
Export realisations from lobster were lower due to weaker selling prices and the
stronger rand. Lobster catches were good and the group"s full quota was landed.
Midwater pelagic catches improved in both Namibia and South Africa after the
disruptions caused by vessel breakdowns in the first half. Selling prices for
the smaller sized Namibian horse mackerel were at very low levels for most of
the year due to an oversupply of fish from Mauritania and the Pacific. With
bunker prices at record high levels, the Namibian fishery was a marginal
contributor to profit. In South Africa the newly acquired midwater trawler,
Desert Diamond, performed in accordance with expectations. Trading volumes of
midwater pelagic fish procured from the North Atlantic and Pacific were higher
than the previous year although margins were lower.
Hake catches in South Africa were affected by inconsistent catching and a large
proportion of small size fish yielding lower returns. The strong rand also
negatively affected export earnings. Namibian hake operations continued to
experience low catch rates and low selling prices.
Squid catches were at record levels for the second successive season. Market
prices softened towards the end of the year. Tuna trading showed improved
results as did the import trading business.
Cold storage occupancy levels on average were in line with those of last year
and volumes handled were slightly higher benefiting from increased import
activity. Export fruit volumes increased significantly following the
commissioning of the new fruit facility at Maydon Wharf. Results from the ships
agency and bunker operations declined due to fewer foreign fishing vessels
calling at Cape Town.
Net cash balances reduced as a result of the acquisition of Glenryck UK and
increased canned fish inventories in both South Africa and Namibia.
RAH shareholding in Ocfish
Real Africa Holdings Ltd (RAH) recently announced that the sale of its
shareholding in Ocfish Holding Company Ltd (Ocfish) had been unsuccessful.
Oceana is currently investigating alternative structures to facilitate the
transfer of RAH"s shareholding to a suitable BEE consortium.
Prospects
Canned fish sales volumes on the domestic market are expected to increase in the
coming year. It is anticipated that South African and Namibian pilchard TACs
will be sufficient to supply local and export requirements. Glenryck UK is
expected to perform well on the back of consistent supply.
A strong rand will continue to negatively affect export earnings. Lobster prices
are expected to improve and volumes should be higher due to the increased TAC.
Midwater pelagic earnings will depend largely on supply and the effect thereof
on market prices.
Commercial Cold Storage expects improved results particularly given the proven
capabilities of the steri-fruit handling facility at Maydon Wharf.
Prospects for an increase in headline earnings per share for the year ahead are
largely dependent on the rand exchange rate.
On behalf of the board.
DMJ Ncube AB Marshall
Chairman Chief Executive Officer
DIVIDEND DECLARATION
Notice is hereby given that a final dividend No. 122 of 59.0 cents per share, in
respect of the year ended 30 September 2004, was declared on Thursday
11 November 2004. Relevant dates are as follows:
Last day to trade cum dividend - Friday 7 January 2005
Commence trading ex dividend - Monday 10 January 2005
Record date - Friday 14 January 2005
Dividend payable - Monday 17 January 2005
Share certificates may not be dematerialised or rematerialised between
Monday 10 January 2005 and Friday 14 January 2005, both dates inclusive.
By order of the board
J D Cole Secretary
11 November 2004
JSE Share Code: OCE
ISIN Number: ZAE000025284
Date: 11/11/2004 04:30:09 PM Supplied by www.sharenet.co.za
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