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LAF - Lonrho reports a 29% increase in turnover for the 6 months ended 31

Release Date: 31/05/2011 17:10
Code(s): LAF
Wrap Text

LAF - Lonrho reports a 29% increase in turnover for the 6 months ended 31 March 2011 Lonrho Plc (Incorporated and registered in England and Wales) (Registration number 2805337) (Share code: LAF ISIN number: GB0002568813) ("Lonrho" or "the Company") LONRHO REPORTS A 29% INCREASE IN TURNOVER FOR THE 6 MONTHS ENDED 31 MARCH 2011 Lonrho Plc, the conglomerate with a structured portfolio of African investments, announces its unaudited Interim Results for the six months ended 31 March 2011. The financial information in this statement does not constitute the Company`s statutory accounts within the meaning of Section 434 of the Companies Act 2006. Financial Highlights for the six months to 31 March 2011 - For the half year the revenue of GBP61.1m is 29% ahead of the first half of FY10. - In the first half of the financial year, the loss before tax was GBP2.9m. When compared to the prior year, and after excluding an exchange gain of GBP5.7m in that year (current year GBP nil), this represents an underlying improvement of GBP4.3m. - Net assets at 31 March 2011 stood at GBP126.4m, compared with GBP124.5m as at 31 December 2010. - Available cash balances in the Group at 31st March 2011 were GBP17.8m. The interim report and financial statements are published on the Company`s website (www.lonrho.com) today. David Lenigas, Lonrho`s Executive Chairman, commented: "The results for the half year are positive, showing a 29% increase in turnover for the six months when compared to the previous year. Excluding exchange movements, the loss before tax of GBP2.9m represented an underlying improvement of GBP4.3m for the period. We continue to see strong growth across all of our divisions, spear-headed by Lonrho`s agribusiness and infrastructure businesses. We expect to see continued growth across all sectors for the remainder of the financial year, as we move into our typically strongest period." Enquiries Lonrho Plc +44 (0) 20 7016 5105 David Lenigas Geoffrey White David Armstrong Pelham Bell Pottinger +44 (0) 20 7861 3126 Charles Vivian James Macfarlane Chief Executive`s Statement Lonrho has delivered a strong first six months to 31 March 2011 and has seen continued growth across all five divisions. The Company maintains its focus on providing the support industries for the expanding oil and gas, agricultural and mineral sectors in sub-Saharan Africa. The five divisional operations, agriculture, infrastructure, transportation, hotels and support services have each reported increased sales year on year and are operating in markets that are growing rapidly as sub-Saharan Africa continues to deliver strong economic development. The one billion people in the Continent are creating an increasingly larger consumer market as general levels of disposable income rise. Africa continues to benefit from improved political stability and the Continent now contains some of the fastest growing economies in the world. Recent events in North Africa have had no material effect on sub-Saharan Africa. The oil and gas and agriculture sectors in Africa are playing an increasingly more important role, not only in developing the African economy, but also in gaining acceptance of Africa as a strong global emerging market. The increasing dependence of the rest of the world on sub- Saharan Africa as a source for oil and gas, and agricultural produce specifically, will be a positive influence in building Africa`s global importance in the coming years. International research on emerging markets from Ernst & Young, BCG, World Bank, McKinsey and others is already highlighting the importance of Africa as an essential part of the global market moving forward. Lonrho`s strategy to support the fastest growing industrial sectors continues. With the Company`s policy of geographical spread of operations (Lonrho is now working in seventeen countries), and a `stand-alone` divisional structure with no debt recourse from division to division, the Board continues to believe Lonrho has a prudent approach to operating in the sub-Saharan African market. In October 2010, the Company completed the issue of US$70 million (GBP44.3 million) Guaranteed Convertible Bonds due 2015. On 20 May 2011, Lonrho announced a placing of new ordinary shares in the capital of the Company at 16.5 pence per share to raise gross proceeds of GBP19.5 million. Post 31 March 2011, Lonrho was admitted to the Main Market of the London Stock Exchange as a Premium Listing on the 26th April 2011 and, upon admission to the Main Market, the Rt. Hon Sir Richard Needham joined the Board as an Independent Non-Executive Director. Lonrho is well positioned to enter the second half of the financial year and to continue the strong growth and development of the Group. Financial Highlights for the six months to 31 March 2011 - For the half year the revenue of GBP61.1m is 29% ahead of the first half of FY10. - In the first half of the financial year, the loss before tax was GBP2.9m. When compared to the prior year, and after excluding an exchange gain of GBP5.7m in that year (current year GBP nil), this represents an underlying improvement of GBP4.3m. - Net assets at 31 March 2011 stood at GBP126.4m, compared with GBP124.5m as at 31 December 2010. - Available cash balances in the Group at 31st March 2011 were GBP17.8m. Operational Review Agribusiness The agribusiness division has grown to be over 50% of Lonrho`s total revenue and continues to see growing demand. The agribusiness division has three distinct businesses: fruit and vegetables; fish and shellfish; and agricultural equipment. Rollex (100% holding), the fruit and vegetable business, is seeing increasing demand from retailers both in South Africa and from around the world for produce from Southern Africa. Lonrho sources product on off-take agreements from Mozambique, Tanzania, Zimbabwe, Zambia and South Africa and provides the vertically integrated, international standard, packing, processing and logistics services to deliver the produce in the best condition to the supermarket shelf, whether it be in Cape Town, London, New York or Beijing. In the first half of this year, as planned, Rollex has refocused its strategy around purely vertically integrated agribusiness with less emphasis on general logistics. A similar vertically integrated packing, processing and logistics chain is operated for the fish and shellfish business, taking `wild caught`, `sustainably sourced` fish and shellfish from Namibia, South Africa and Mozambique, and preparing it and supplying it to retail clients` requirements in South Africa and the world. The traditional Southern African markets for both the fish and fruit and vegetable businesses are developing strongly as South African based retail chains are expanding the number of stores they have both in South Africa and as they develop across Africa. A significant market is developing in the export of fruit, vegetables, fish and shellfish from Africa to the rest of the world. The fruit and vegetable division of the business has seen increasing demand from Europe, the Middle East, Far East and an initial interest from the US market for African produce by both air and sea freight. The potential for Southern Africa to become a significant part of the global marketplace for fruit and vegetables is clearly apparent. Lonrho`s agribusiness division is well positioned to partake in developing this market. Oceanfresh (51% holding), the fish and shellfish division, has seen good growth in sales into the South African retail chains as they expand their operations, as well as very significant demand from the US market for Oceanfresh products. The US market has developed strongly with new listings for Oceanfresh products with Costco and other large retail chains. The US market is keen to find supplies of `wild caught` and `sustainable sourced` fish, and the Oceanfresh SASSI (Southern African Sustainable Seafood Initiative) program, endorsed by the WWF, has direct appeal to the requirements of the US retail market. Oceanfresh is in the process of relocating to bigger premises in Johannesburg to meet forecast demand and to increase in-house capabilities. The new facility, which will quadruple capacity, includes a 500 tonne cold store unit, a high-care processing area and a general processing area. The new facility will allow Oceanfresh to further increase the export and local retail lines available for customers. The agricultural equipment business, primarily the distribution of John Deere tractors in Mozambique and Angola, is progressing well. The volumes in Mozambique through Trak Auto (100% holding) have increased substantially, stimulated by both a growing market and a strong increase in John Deere market share. LonAgro (51% holding), the new John Deere distributor in Angola, will be officially opened in June 2011 when the CEO of John Deere inaugurates the project with Angolan Government officials. Infrastructure Luba Freeport (63% holding) continues to service the oil services logistics market for Equatorial Guinea, Africa`s third largest oil producer. The client base for the port is expanding and, during the first half of the year, clients have been focused on the preparation work for new drilling programs due to commence in 2012. The mobilisation for these programs has geared up later than originally scheduled which has pushed back new revenue streams for the port. The announcement of a further LNG train for Equatorial Guinea and the coming increase in exploration of newly released blocks will drive the business growth moving forward. Luba Freeport took delivery of a mobile container scanner during the period, which increases the port`s security in line with international practices and ensures that every container landed at the Luba facility can be scanned. Kwikbuild (51% holding) is now benefitting from the investment made in manufacturing capacity and additional human resources during the period. The company has been successfully building its sales and management expertise to generate overseas orders to diversify away from the historic dependence on South African Government tenders. During the period, Lonrho also announced the completion of the purchase of the AFEX Group of companies (100% holding). AFEX`s main focus of operations is in supplying services and secure accommodation in Juba, Southern Sudan. Key to the AFEX business is the Riversdale Lodge accommodation base in Juba. Since acquisition, a new 16 year lease has been signed for the site and a further 18 new VIP containerised accommodation units have been added bring the accommodation total to 301 units. AFEX has also been contracted to provide a camp and support services for a seismic exploration company in Kenya, was awarded a short term contract to erect a tented camp in Ethiopia and has won contracts with mining companies. Transportation On a revenue basis, the transportation division, Lonrho Aviation (100% holding), has had a strong start to the year with all of the major markets showing good growth. Most pleasing is the launch of scheduled services for Fly540 in Tanzania and in Angola. During the period, Fly540 Kenya (49% holding + Board control) has seen a 25% increase in passenger volumes and an increase in revenues despite an aggressive price campaign from local competitors in Kenya. Fly540 Kenya commenced scheduled flights from Nairobi to Juba in Southern Sudan in May 2011. Fly540 Tanzania (90% holding) is achieving very high load factors and as a result has entered a new phase of expansion to service more destinations in Tanzania. Fly540 Angola (60% holding) commenced scheduled services on 31 January 2011. The deployment of the Angolan hub has been building as new aircraft arrive in the country with three aircraft operating scheduled services in May and a plan for five to be operating scheduled services by the end of July. Regular services between Cabinda, Soyo, Benguela, Lubango, and Luanda are working efficiently and initial flights in Angola have proved very successful with good load factors. Operations at Fly540 Ghana (60% holding) will commence towards the end of this year once Angola has been fully established. Hotels The hotels division enjoyed a good start to the year. The Hotel Cardoso (59% holding) saw exceptional occupancy levels, which averaged over 80% for the period. The hotel has also seen strong room rates at a 37% increase on the same period a year ago. The Mozambique Metical has devalued 17% against the Pound Sterling, resulting in an adverse variance to turnover of US$439,000 in the period. By the end of the period, occupancy at the Grand Karavia, Lubumbashi (50% holding + management contract) has built up to 50% and growth is expected to continue in the second half as the hotel continues to move towards its full business plan. During the period Lonrho Hotels signed a new lease in the Gabon capital of Libreville. The 5-star boutique hotel is scheduled to open in the middle of 2011 and is anticipated to trade as the top five star hotel in Gabon. Lonrho Hotels Management Services will continue to pursue further new projects into the second half of the year and has bolstered its management team to support the existing hotels and expected new management contracts for further properties. Support Services Bytes & Pieces (65% holding) has continued to grow during the period and continues to benefit from the economic growth in Mozambique and has won new projects with Banco Unico, Assoiacao Nacional de Estradas, Maputo Port Development Corporation and Bank BCI Formento. CES Zambia (40% holding + Board control) has had an exceptional period with growth being driven by a number of new contract wins including KPMG, Africonnect, FHI (USAID) and World Vision. Lonrho Water (100% holding) is developing two sizeable projects, being a sewage pump station in Angola and series of solar powered boreholes in South Africa. In the corporate water bottling business, volumes are growing and new customers are being signed. Lonrho Projects, based in Johannesburg, continues to support the other Lonrho divisions in a range of new project initiatives. Other Investments LonZim Plc (24.61% holding + management contract) LonZim has invested in and restructured its business in Zimbabwe and each is well placed to return to market and show rapid growth as the Zimbabwean economy recovers. The commercial market has gained some stability during the period and the individual LonZim businesses are seeing increasing sales on a monthly basis. Lonrho Mining (17.04% holding) Lonrho Mining continues to concentrate on the exploration, sampling and development of the Lulo diamond concession in Angola. The results from the airborne survey of the concession are very encouraging, and initial sampling results on the chosen targets for further exploration have been impressive. The results from the sampling program continue to build a full geological model of the primary targets for future commercial production. Geoffrey White Director & Chief Executive Officer 31 May 2011 Condensed consolidated interim income statement Unaudited Audited
Unaudited 6 months to 6 months 12 months 31 March to to
2011 31 March 30 2010 September 2010 GBP`m GBP`m GBP`m
Not e
Revenue 61.1 47.3 5 107.8 Cost of sales (46.4) (35.3) (79.3) GROSS PROFIT 14.7 12.0 28.5 Gain arising on fair valuation 4.9 - 9.0 of biological assets Other operating income 1.6 0.1 3.6 Operating costs (21.5) (17.9) (45.4) OPERATING LOSS (0.3) (5.8) (4.3) Finance income - 5.7 8.6 Finance expense (2.8) (0.8) (5.7) NET FINANCE (EXPENSE)/INCOME (2.8) 4.9 2.9 Share of results of associates 0.2 (0.4) 2.3 Share of results of joint - (0.2) (0.4) ventures (LOSS)/PROFIT BEFORE TAX (2.9) (1.5) 0.5
Income tax charge (0.4) (0.2) (0.7) LOSS FOR THE PERIOD (3.3) (1.7) (0.2)
ATTRIBUTABLE TO: Owners of the Company (1.2) (1.0) 0.3 Non-controlling interests (2.1) (0.7) (0.5) LOSS FOR THE PERIOD (3.3) (1.7) (0.2) EARNINGS PER SHARE Basic and diluted 3 (0.10) (0.10) 0.03 (loss)/earnings per share (pence) Condensed consolidated interim statement of comprehensive income Unaudited Unaudited Audited
31 March 31 March 30 2011 2010 September 2010 GBP`m GBP`m GBP`m
ASSETS Goodwill 15.8 14.2 15.5 Other intangible assets 5.6 2.8 4.5 Property, plant and equipment 124.0 75.3 109.2 Biological assets 15.0 - 9.0 Investments in associates and 12.9 8.7 10.3 joint ventures Other investments 0.2 0.5 0.6 Deferred tax 0.7 0.1 0.7 TOTAL NON-CURRENT ASSETS 174.2 101.6 149.8 Inventories 6.7 4.8 4.9 Trade and other receivables 45.8 43.8 33.9 Cash and cash equivalents 23.9 17.0 7.8 TOTAL CURRENT ASSETS 76.4 65.6 46.6 TOTAL ASSETS 250.6 167.2 196.4 EQUITY Share capital 11.8 10.5 11.7 Share premium account 138.4 126.1 138.0 Revaluation reserve 3.9 4.3 3.3 Share option reserve 4.6 2.5 4.7 Translation reserve (9.2) (4.2) (8.7) Other reserves (4.5) - (5.5) Retained earnings (37.4) (40.2) (36.1) TOTAL EQUITY ATTRIBUTABLE TO 107.6 99.0 107.4 EQUITY HOLDERS OF THE COMPANY NON-CONTROLLING INTERESTS 18.8 2.3 20.3 TOTAL EQUITY 126.4 101.3 127.7 LIABILITIES Financial liabilities - 0.3 - Loans and borrowings 63.0 14.3 24.6 Deferred tax 3.0 2.3 3.0 Obligations under finance leases 10.8 1.1 1.8 Trade and other payables 3.3 - 2.5 TOTAL NON-CURRENT LIABILITIES 80.1 18.0 31.9 Bank overdraft 4.7 0.9 3.9 Loans and borrowings 3.9 9.2 4.6 Obligations under finance leases 0.9 0.2 1.0 Trade and other payables 34.3 37.6 27.0 Tax liability 0.3 - 0.3 TOTAL CURRENT LIABILITIES 44.1 47.9 36.8 TOTAL LIABILITIES 124.2 65.9 68.7 TOTAL EQUITY AND LIABILITIES 250.6 167.2 196.4 Condensed consolidated interim statement of financial position Unaudited Unaudited Audited 31 March 31 March 30 2011 2010 September
2010 GBP`m GBP`m GBP`m Foreign exchange translation 0.8 (2.2) (8.7) differences Revaluation of property, plant and - 0.2 - equipment Total other comprehensive income and 0.8 (2.0) (8.7) expense Loss (3.3) (1.7) (0.2) Total comprehensive income and (2.5) (3.7) (8.9) expense
ATTRIBUTABLE TO: Owners of the Company (1.1) (3.0) (7.2) Non-controlling interests (1.4) (0.7) (1.7) Total comprehensive income and (2.5) (3.7) (8.9) expense Condensed consolidated interim cash flow statement Unaudite Unaudite Audited d d
31 March 31 March 30 2011 2010 September 2010 GBP`m GBP`m GBP`m
CASH FLOWS FROM OPERATING ACTIVITIES Loss (3.3) (1.7) (0.2) Adjustments 1.8 (0.2) (3.7) CASH FLOWS FROM OPERATING ACTIVITIES BEFORE MOVEMENTS IN WORKING CAPITAL (1.5) (1.9) (3.9) Change in inventories (1.5) (1.4) (0.1) Change in trade and other receivables (12.3) (13.0) 1.0 Change in trade and other payables 2.9 1.1 (10.4) CASH GENERATED FROM OPERATIONS (12.4) (15.2) (13.4) Interest received - - 0.1 Interest paid (2.8) (0.8) (2.3) Income tax paid (0.6) - (0.4) NET CASH FROM OPERATING ACTIVITIES (15.8) (16.0) (16.0) CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant - - 0.4 and equipment Acquisition of subsidiary, net of cash (1.3) - (3.2) acquired Acquisition of property, plant and (13.6) (4.5) (6.8) equipment Acquisition of associates and joint (1.2) - (0.1) ventures Acquisition of investment - - (0.4) NET CASH FROM INVESTING ACTIVITIES (16.1) (4.5) (10.1) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the issue of shares 0.3 23.9 23.6 Loan advance 49.5 7.2 3.7 Repayment of borrowings (1.3) (0.5) (2.1) Payment of finance lease liabilities (1.4) (0.1) (0.9) Minority dividends paid - - (0.4) NET CASH FROM FINANCING ACTIVITIES 47.1 30.5 23.9 Net increase/(decrease) in cash and 15.2 10.0 (2.2) cash equivalents Cash and cash equivalents at beginning 3.9 6.0 6.0 of the period Foreign exchange movements 0.1 0.1 0.1 CASH AND CASH EQUIVALENTS AT END OF 19.2 16.1 3.9 THE PERIOD
Condensed consolidated interim statement of changes in equity Owners Non- Total of the controll Company ing
interest s GBP`m GBP`m GBP`m AUDITED Balance at 1 October 2009 78.1 3.0 81.1 Profit/(loss) 0.3 (0.5) (0.2) Foreign exchange translation (7.5) (1.2) (8.7) differences Total comprehensive income and expense (7.2) (1.7) (8.9) Issue of shares 37.0 - 37.0 Issue of share options (net) 2.2 - 2.2 Purchase of non-controlling interests (5.5) (4.1) (9.6) Subsidiaries acquired - (0.1) (0.1) Non-controlling interests contribution - 25.5 25.5 Minority dividends - (0.4) (0.4) Transfer from joint venture to - 0.9 0.9 subsidiary Transfer between accounts 2.8 (2.8) - BALANCE AT 30 SEPTEMBER 2010 107.4 20.3 127.7
UNAUDITED Balance at 1 October 2010 107.4 20.3 127.7 Loss (1.2) (2.1) (3.3) Foreign exchange translation 0.1 0.7 0.8 differences Total comprehensive income and expense (1.1) (1.4) (2.5) Issue of shares 0.3 - 0.3 Subsidiaries disposed - (0.1) (0.1) Equity portion of convertible bond 1.0 - 1.0 BALANCE AT 31 MARCH 2011 107.6 18.8 126.4 UNAUDITED Balance at 1 October 2009 78.1 3.0 81.1 Loss (1.0) (0.7) (1.7) Foreign exchange translation (2.2) - (2.2) differences Revaluation of property, plant and 0.2 - 0.2 equipment Total comprehensive income and expense (3.0) (0.7) (3.7) Issue of shares 23.9 - 23.9 BALANCE AT 31 MARCH 2010 99.0 2.3 101.3 Notes Note of preparation 1. Basis of preparation The annual financial statements of the Group are prepared in accordance with IFRSs as adopted by the EU. The condensed set of financial statements included in this half yearly report has been prepared in accordance with IAS 34 and the recognition and measurement requirements of IFRSs as adopted by the EU. The financial information is unaudited and has not been reviewed by the Company`s auditors and does not constitute the Company`s statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the year ended 30 September 2010 have been delivered to the Registrar of Companies. The comparative figures for the financial year ended 30 September 2010 are not the Company`s statutory accounts for that financial year. Those accounts have been reported on by the Company`s auditors and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report, and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006. 2. Significant accounting policies The accounting policies applied by the Group in these condensed consolidated interim financial statements are substantially the same as those applied by the Group in its consolidated financial statements for the year ended 30 September 2010. Whilst there have been changes to standards which become applicable for the year ending 30 September 2011, none have been assessed as having a significant impact on the Group. 3. Earnings per share Basic and diluted earnings per share are arrived at by dividing the loss/profit for the period by the average number of shares in issue during the period. Headline earnings per share are equal to basic earnings per share as there are no reconciling items. 4. Capital management Given the ongoing global financial crisis, the Directors are carefully monitoring cash resources within the Group and have instigated a number of initiatives to ensure funding will be available for planned projects. As referred to in the Chief Executive`s Statement, in October 2010 the Company completed the issue of US$70 million (GBP44.3 million) Guaranteed Convertible Bonds due 2015. On 20 May 2011, Lonrho announced a placing of new ordinary shares in the capital of the Company at 16.5 pence per share to raise gross proceeds of GBP19.5 million. 5. Segmental reporting The Chief Operating Decision Maker is deemed to be the Executive Committee which monitors the results of the business segments to assess performance and make decisions about the allocation of revenues. Segment performance is evaluated on both revenue and operating profit/(loss). Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Unallocated items comprise mainly interest earning assets, interest-bearing loans, borrowings and expenses, and corporate assets and expenses. Segment capital expenditure is the total cost incurred during the period to acquire segment assets that are expected to be used for more than one period. There is no inter-segment revenue. Business segments The Group has five continuing reportable segments which are organised around the basis of products and services which they provide: - Agribusiness - Infrastructure - Transportation - Support services - Hotels The Group has not aggregated any operating segment in arriving at this analysis. 6 months to 31 March 2011
Agri- Infra- Trans- business structure portation
GBP`m GBP`m GBP`m EXTERNAL REVENUE 31.6 7.4 10.1 Segment result 7.1 (0.6) (2.7) Unallocated expenses OPERATING LOSS Net finance income Share of results of associates Income tax charge LOSS FOR THE PERIOD Table continues:... Support Hotels Consolidated services continuing
operations GBP`m GBP`m GBP`m EXTERNAL REVENUE 7.8 4.2 61.1 Segment result 0.3 0.0 4.1 Unallocated (4.4) expenses OPERATING LOSS (0.3) Net finance (2.8) income Share of results 0.2 of associates Income tax charge (0.4) LOSS FOR THE (3.3) PERIOD 6 months to 31 March 2010
Agri- Infra- Trans- business structure portation
GBP`m GBP`m GBP`m EXTERNAL REVENUE 23.9 6.4 9.8 Segment result 0.8 0.2 (2.9) Unallocated expenses OPERATING LOSS Net finance income Share of results of associates Share of result of joint ventures Income tax charge LOSS FOR THE PERIOD Table continues:... Support Hotels Consolidated services continuing
operations GBP`m GBP`m GBP`m EXTERNAL REVENUE 4.9 2.3 47.3 Segment result 0.0 0.7 (1.2) Unallocated (4.6) expenses OPERATING LOSS (5.8) Net finance 4.9 income Share of results (0.4) of associates Share of result (0.2) of joint ventures Income tax charge (0.2) LOSS FOR THE (1.7) PERIOD 12 months to 30 September 2010
Agri- Infra- Trans- business structure portation GBP`m GBP`m GBP`m
EXTERNAL REVENUE 55.3 14.0 21.5 Segment result 7.9 4.1 (7.6) Unallocated expenses OPERATING LOSS Net finance income Share of results of associates Share of result of joint ventures Income tax charge LOSS FOR THE YEAR Table Continues:... Support Hotels Consolidated services continuing
operations GBP`m GBP`m GBP`m EXTERNAL REVENUE 11.1 5.9 107.8 Segment result 0.1 0.2 4.7 Unallocated (9.0) expenses OPERATING LOSS (4.3) Net finance 2.9 income Share of results 2.3 of associates Share of result (0.4) of joint ventures Income tax (0.7) charge LOSS FOR THE (0.2) YEAR 6 months to 31 March 2011
Agri- Infra- Trans- Support business structure portation service s GBP`m GBP`m GBP`m
GBP`m Segment 58.8 83.4 33.5 12.5 operating assets Investment in - - - - associates Unallocated - - - - assets/interest bearing assets TOTAL ASSETS 58.8 83.4 33.5 12.5 Segment 22.2 15.2 19.3 6.8 operating liabilities Unallocated - - - - liabilities/inte rest bearing liabilities TOTAL 22.2 15.2 19.3 6.8 LIABILITIES Depreciation of 0.7 1.6 0.2 0.1 segment assets Amortisation of 0.3 - - 0.1 segment assets Capital 1.2 0.8 13.2 0.2 expenditure Table Continues:... Hotels Other Consolidated continuing
operations GBP`m GBP`m GBP`m Segment 25.0 - 213.2 operating assets Investment in - 12.9 12.9 associates Unallocated - 24.5 24.5 assets/interest bearing assets TOTAL ASSETS 25.0 37.4 250.6 Segment 11.0 - 74.5 operating liabilities Unallocated - 49.7 49.7 liabilities/inte rest bearing liabilities TOTAL 11.0 49.7 124.2 LIABILITIES Depreciation of 0.6 0.1 3.3 segment assets Amortisation of - - 0.4 segment assets Capital 0.3 0.1 15.8 expenditure 6 months to 31 March 2010
Agri- Infra- Trans- Support business structu portati service re on s
GBP`m GBP`m GBP`m GBP`m Segment operating 36.1 65.4 18.2 4.7 assets Investment in - - - - associates Unallocated - - - - assets/interest bearing assets TOTAL ASSETS 36.1 65.4 18.2 4.7 Segment operating 26.7 25.6 7.1 1.6 liabilities Unallocated liabilities/inter - - - - est bearing liabilities TOTAL LIABILITIES 26.7 25.6 7.1 1.6 Depreciation of 1.5 1.4 0.4 0.1 segment assets Amortisation of 0.2 - - 0.1 segment assets Capital 0.3 3.2 0.3 - expenditure
Table continues:... Hotels Other Consolidated continuing operations
GBP`m GBP`m GBP`m Segment operating 13.6 - 138.0 assets Investment in 1.3 7.4 8.7 associates Unallocated - 20.5 20.5 assets/interest bearing assets TOTAL ASSETS 14.9 27.9 167.2 Segment operating 1.0 - 62.0 liabilities Unallocated liabilities/inter - 3.9 3.9 est bearing liabilities TOTAL LIABILITIES 1.0 3.9 65.9 Depreciation of 0.2 - 3.6 segment assets Amortisation of - - 0.3 segment assets Capital 0.2 - 4.0 expenditure 12 months to 30 September 2010
Agri- Infra- Trans- Support business structure portatio services n GBP`m GBP`m GBP`m
GBP`m Segment operating 51.1 82.9 16.4 3.9 assets Investment in - - - - associates Unallocated assets/interest - - - - bearing assets TOTAL ASSETS 51.1 82.9 16.4 3.9 Segment operating 28.8 14.5 7.4 1.2 liabilities Unallocated liabilities/interest - - - - bearing liabilities TOTAL LIABILITIES 28.8 14.5 7.4 1.2 Depreciation of 1.5 3.0 0.6 0.1 segment assets Amortisation of 0.5 - 0.1 0.2 segment assets Capital expenditure 2.9 3.7 0.8 - Table continues:... Hotels Other Consolidated continuing
operations GBP`m GBP`m GBP`m Segment operating 23.3 - 177.6 assets Investment in - 10.3 10.3 associates Unallocated assets/interest - 8.5 8.5 bearing assets TOTAL ASSETS 23.3 18.8 196.4 Segment operating 9.9 - 61.8 liabilities Unallocated liabilities/interes - 6.9 6.9 t bearing liabilities TOTAL LIABILITIES 9.9 6.9 68.7 Depreciation of 0.6 0.1 5.9 segment assets Amortisation of - - 0.8 segment assets Capital expenditure 1.4 0.3 9.1 6. Acquisition of subsidiaries AFEX On 1 January 2011, the Group acquired 100% of the issued share capital of AFEX Group of companies for an initial consideration of US$3 million (GBP1.9 million). Further payments of up to US$5 million (GBP3.1 million) will be payable over two years based on an EBIT related earn-out formula. AFEX`s main focus of current operations is in supplying secure accommodation in Juba in the Southern Sudan. This infrastructure is in great demand from corporate clients, NGO`s, and Government Aid Agencies working in Southern Sudan. The transaction has been accounted for by the purchase method of accounting. The fair value of the net assets at 1 January 2011 is set out below: Pre- Fair Values acquisition valuation recognised carrying adjustment on value on acquisition
acquisition GBP`m GBP`m GBP`m Property, plant and equipment 2.9 0.7 3.6 Inventory 0.1 - 0.1 Trade and other receivables 1.6 - 1.6 Cash and cash equivalents 0.6 - 0.6 Trade and other payables (3.3) - (3.3) Intangible related to customer - 1.5 1.5 relationships NET IDENTIFIABLE ASSETS AND 1.9 2.2 4.1 LIABILITIES Consideration paid 1.9 Contingent consideration 2.5 GOODWILL ON ACQUISITION 0.3 The transaction costs incurred to acquire the company were GBP0.1 million and have been expensed in the income statement. The goodwill arising on the acquisition of AFEX is attributable to the anticipated profitability of the distribution of the company`s services to new customers. AFEX contributed GBP1.8 million to revenue and GBP0.2 million profit to the Group`s profit before tax for the period between the date of acquisition and the reporting date. 7. Interest bearing loans and borrowings This note provides information about the contractual terms of the Group`s interest-bearing loans and borrowings. 6 months 6 months to 12 months to to 31 March 30 September 31 March 2010 2010
2011 GBP`m GBP`m GBP`m NON CURRENT LIABILITIES Finance lease liabilities 10.8 1.1 1.8 Unsecured bank loan 17.4 11.8 20.3 Convertible bonds (note 7a) 42.6 - - Shareholder loans 3.0 2.5 2.5 Other loan - - 1.8 73.8 15.4 26.4 CURRENT LIABILITIES Unsecured bank loans 3.9 9.2 2.8 Current portion of finance lease 0.9 0.2 1.0 liabilities Other loan - - 1.8 Bank overdraft 4.7 0.9 3.9 9.5 10.3 9.5
7a. In October 2010, Lonrho Plc successfully completed the offering of US$60m (GBP38.0m) Guaranteed Convertible Bonds due 2015 ("Bonds") via a wholly owned subsidiary company LAH (Jersey) Limited. Lonrho has then further placed US$10m (GBP6.3m) of additional Bonds, which were fully subscribed. The net proceeds of the offering will be used to allow the Company and its subsidiaries to repay certain existing indebtedness, to fund general working capital and to accelerate growth in its operations. A copy of the Offering Circular in relation to the Bonds is available on the Company`s website: www.lonrho.com. On initial recognition GBP1.0 million of the total liability under the convertible bonds has been transferred to other reserves, representing the equity portion of the bonds at the date of initial recognition. 8. Net finance income 6 months 6 months to 12 months to to 31 March 30 September 31 March 2010 2010
2011 GBP`m GBP`m GBP`m Bank interest receivable - - 0.1 Foreign exchange gain - 5.7 8.5 FINANCE INCOME - 5.7 8.6 Loans repayable within five years (2.7) (0.8) (2.1) and overdrafts Foreign exchange loss - - (3.4) Finance leases (0.1) - (0.2) FINANCE EXPENSE (2.8) (0.8) (5.7) NET FINANCE INCOME (2.8) 4.9 2.9 9. Note to the cash flow statement 6 months 6 months 12 months to to to 30 September 31 March 31 March 2010 2011 2010 GBP`m
GBP`m GBP`m Depreciation of property, plant and 3.3 3.6 5.9 equipment Amortisation of intangible assets 0.4 0.3 0.8 Impairment of investment - - 0.4 Share based payment expense - - 2.3 Finance income 2.8 (4.9) (2.9) Share of profit of associates and (0.2) 0.6 (1.9) joint ventures Gain arising on fair valuation of (4.9) - (9.0) biological assets Income tax expense 0.4 0.2 0.7 ADJUSTMENTS TO LOSS FOR THE PERIOD 1.8 (0.2) (3.7) 10. Related party transactions Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note. Full details of the Group`s other related party transactions and balances are given in the Group`s financial statement for the year ended 30 September 2010. The only material change in these relationships in the half year to 31 March 2011 is Lonrho`s participation in a placing of shares by LonZim Plc, in which Lonrho participated to maintain its percentage shareholding of 24.61% by subscribing for 4,384,011 new LonZim shares at a cost of GBP1,227,523. 11. Post balance sheet events On 26 April 2011, Lonrho successfully transferred the listing of its ordinary share capital from AIM to the premium listing segment of the Official List of the UK Listing Authority and to trading on the London Stock Exchange plc`s main market for listed securities under the ticker "LONR". Trading in the Company`s shares on AIM was cancelled simultaneously with Admission. Also on 26 April 2011, Lonrho also announced the appointment of the Rt. Hon. Sir Richard Needham as an Independent Non-Executive Director of the Company. Sir Richard had a distinguished career in Parliament culminating in his time as Britain`s longest serving Minister in Northern Ireland from 1985 - 1992 and as Minister of Trade from 1992 - 1995. On 10 May 2011, Lonrho announced that the Johannesburg Stock Exchange had formally approved the transfer of the secondary listing of the Company from the Venture Capital Market to the AltX of the JSE with effect from the commencement of business on 17 May 2011. On 20 May 2011, Lonrho announced a placing of new ordinary shares in the capital of the Company at 16.5 pence per share to raise gross proceeds of GBP19.5 million. The placing was limited to 118,000,000 new shares in the capital of Lonrho and represented approximately 9.99% of the issued share capital of Lonrho. On 25 May 2011 Lonrho announced that 118,000,000 shares had been placed. The shares were admitted to trading on 26 May 2011. 12. Cautionary statements The interim results announcement contains forward looking statements. These have been made by the Directors in good faith based on the information available to them up to the time of their approval of this report. The Directors can give no assurance that these expectations will prove to have been correct. Due to the inherent uncertainties, including both economic and business risk factors underlying such forward looking information, actual results may differ materially from those expressed or implied by these forward looking statements. The Directors undertake no obligation to update any forward looking statements whether as a result of new information, future events or otherwise. There are a number of potential risks and uncertainties which could have a material impact on the Group`s performance over the remainder of the financial year and could cause actual results to differ materially from expected and historical results. These include but are not limited to, competitor activity and competition risk, changes in foreign exchange and commodity prices and the political and economic risks of operating in Africa. Details of the key risks facing the Group`s businesses at an operational level are included on pages 11 to 24 of the Group`s listing prospectus which is available on the Group`s website (www.lonrho.com). Details of further potential risks and uncertainties arising since the issue of that document are included within the operating review as appropriate. 13. Responsibility statement The interim results announcement complies with the Disclosure and Transparency Rules ("the DTR") of the Financial Services Authority in respect of the requirement to produce a half yearly financial report. The Directors confirm that to the best of their knowledge: - this financial information has been prepared in accordance with IAS 34 as adopted by the EU; - this interim results announcement includes a fair review of the important events during the first half and their impact on the financial information, and a description of the principle risks and uncertainties for the remaining half of the year as required by DTR 4.2.7R; and - this interim results announcement includes a fair review of the disclosure of related party transactions and changes therein as required by DTR 4.2.8R. Geoffrey White Director & Chief Executive Officer 31 May 2011 On behalf of the Board Corporate information Directors David Lenigas Chairman Geoffrey White Director & Chief Executive Officer David Armstrong Finance Director Emma Priestley Executive Director Ambassador Frances Cook Senior Independent Director The Rt, Hon. Sir Richard Needham Non-Executive Director Jean Ellis Non-Executive Director Kiran Morzaria Non-Executive Director Secretary and Registered Office Registrars J H Hughes Equiniti Level 2 Aspect House 25 Berkeley Square Spencer Road London Lancing W1J 6HB West Sussex Tel: +44 (0) 20 7016 5105 BN99 6DA Fax: +44 (0) 20 7016 5109 Tel: 0800 169 2608 (if calling from UK) e-mail: hughes@lonrho.com Tel: +44 121 415 7047 (if calling from Registered in England overseas) Number 2805337 Textel: 0871 384 2255 (for the hard of hearing) Please be advised calls to the textel
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Auditors South African Transfer Secretaries KPMG Audit Plc Computershare Investor Services (Pty) 15 Canada Square Ltd Canary Wharf PO Box 61051 London Marshalltown 2107 E14 5GL South Africa Tel: +27 (0) 11 370 5000 Fax: +27 (0) 11 370 5271/2
PR Advisors Stockbrokers Pelham Bell Pottinger Panmure Gordon (UK) Ltd 5th Floor WH Ireland Ltd Holborn Gate Java Capital (Pty) Ltd 330 High Holborn London WC1V 7QD Principal Group Bankers Tel: +44 (0) 20 7861 3232 Barclays Bank Plc Fax: +44 (0) 20 7861 3233 Lord Street Liverpool
South African Sponsor Java Capital Trustees & Sponsor (Pty) Limited 2 Arnold Road Rosebank 2196 South Africa 31 May 2011 Date: 31/05/2011 17:10:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.

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