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Summary unaudited interim results for the six months ended 31 August 2013
Zeder Investments Limited
Incorporated in the Republic of South Africa
(Registration number: 2006/019240/06)
JSE share code: ZED
ISIN number: ZAE000088431
("Zeder" or "the group")
Summary unaudited interim results for the six months ended 31 August 2013
See-through SOTP value per share increased by 8,7% to R4,73 since year-end
SOTP value per share increased by 8,8% to R4,34 since year-end
Recurring headline earnings per share increased by 8,2% to 9,2 cents
Headline earnings per share increased by 25.4% to 7.4 cents
COMMENTARY
OVERVIEW
Zeder is an investor in the broad agribusiness industry with a specific focus on the food and beverage sectors.
The value of its underlying portfolio of investments amounted to R4,36bn (R4,74bn on a see-through basis) as at
31 August 2013. Agri Voedsel (with its interest of 30,5% in Pioneer Foods) remains a large and strategic
investment representing 39,2% of the portfolio. During the six months under review, Zeder invested a further
R469,4m, of which R353,3m was for an additional stake in Capespan.
STRATEGY
Over the past 12 months, Zeder has communicated a refined strategy to the market. It seeks larger, strategic
stakes in entities that allow it to play a more active role in its underlying portfolio companies and assist
with the determination of appropriate long-term strategies to help expand the respective businesses. Significant
progress has been made in this regard and the investments in Zaad, Chayton Africa and Capespan are examples thereof.
Zeder is actively engaged with its existing portfolio of companies, while continuously seeking new opportunities
and remains optimistic about the sector.
RESULTS
The two key benchmarks which Zeder believes to measure performance by are sum-of-the-parts (SOTP) value per
share and recurring headline earnings per share.
SOTP
Zeders SOTP value per share, calculated using the quoted market prices for all JSE-listed and over-the-counter
traded investments, and market-related valuations for unquoted, unlisted investments, increased by 8,8% to R4,34
since 28 February 2013. Zeders see-through SOTP value per share, calculated on the exact same basis, apart from
using the see-through JSE-listed market price for Agri Voedsels investment in Pioneer Foods instead of Agri
Voedsels own OTC share price, increased by 8.7% to R4.73 since 28 February 2013. At the close of business on
Friday, 4 October 2013, Zeders SOTP and see-through SOTP value per share were R4,53 and R4,99 respectively.
August 2012 February 2013 August 2013
Company Interest Rm Interest Rm Interest Rm
(%) (%) (%)
Agri Voedsel 44,7 1 068,8 45,0 1 475,2 46,8 1 666,0
Kaap Agri 33,8 205,6 34,9 343,2 39,7 453,1
Capevin Holdings 20,3 963,9 5,3 287,6 5,1 312,3
Capespan 37,0 283,4 37,1 284,2 71,7 742,8
Zaad Holdings 92,0 182,4 92,0 368,9 92,0 368,9
Chayton 93,8 276,9 73,4 276,9 76,5 293,3
Suidwes 24,1 90,2 24,1 90,2 24,1 97,0
NWK 19,9 220,4 19,9 224,7 19,9 228,0
Overberg Agri 18,6 108,8 18,6 107,3 18,6 145,6
Other 213,2 54,0 53,3
Total investments 3 613,6 3 512,2 4 360,3
Cash and cash equivalents 32,8 692,2 216,6
Other net liabilities (408,8) (301,1) (324,3)
SOTP value 3 237,6 3 903,3 4 252,6
Number of shares in issue (million) 978,1 978,1 980,2
SOTP value per share (rand) 3,31 3,99 4,34
See-through SOTP value per share (rand) 3,56 4,35 4,73
Net asset value per share (rand) 2,94 3,36 3,48
Zeder's net asset value per share increased by 3,6% since 28 February 2013 to R3,48 per share.
Recurring headline earnings
Zeders consolidated recurring headline earnings is the sum of its effective interest in that of each of its
underlying investments. The result is that investments which Zeder does not equity account in terms of accounting
standards, are included in the calculation of consolidated recurring headline earnings. This provides management
and investors with a more realistic and simplistic way of evaluating Zeders earnings performance.
Audited Unaudited Unaudited
Feb 2013 Aug 2012 Aug 2013
12 months 6 months 6 months
Rm Rm Rm
Earnings analysis
Food, beverages and related services 205,7 71,1 80,3
Agri-related retail, trade and services 120,4 56,2 42,0
Agri-inputs 28,7 2,4 11,5
Agri-production (21,8) (8,4) (9,9)
Net interest, taxation and other income and expenses (23,3) (10,2) (6,0)
Management fee (58,6) (28,0) (28,2)
Recurring headline earnings 251,1 83,1 89,7
Non-recurring headline earnings, net of taxation (54,8) (25,8) (17,3)
Headline earnings 196,3 57,3 72,4
Non-headline items 315,4 50,6 31,7
Attributable earnings 511,7 107,9 104,1
Recurring headline earnings per share (cents) 25,7 8,5 9,2
Headline earnings per share (cents) 20,1 5,9 7,4
Attributable earnings per share (cents) 52,3 11,0 10,6
Recurring headline earnings
Recurring headline earnings per share increased by 8,2% to 9,2 cents, mainly due to improved
contributions from Capespan, Zaad and Kaap Agri during the period under review. However, the positive
effect of the aforementioned was to some extent offset by:
the cash proceeds from the disposal of the bulk of Zeders Capevin Holdings shares yielded a lower return than
what the Capevin Holdings investment did during the comparative period; and
as anticipated, the investment in Chayton, a start-up business in its development phase, incurred a loss, while
drought conditions negatively affected the performance of NWK and Suidwes.
Headline earnings
Headline earnings per share increased by 25,4% to 7,4 cents. The aforementioned, coupled with a decrease in
non-recurring costs incurred by investee companies during the period under review, resulted in the increase in
headline earnings per share.
Attributable earnings
Attributable earnings per share decreased by 3,6% to 10,6 cents as a result of less non-headline gains made
within Zeders investment portfolio during the period under review. Profit before finance costs and taxation
increased by 50% to R193,8m predominantly as a result of the first-time consolidation of Capespans results
following Zeders acquisition of a controlling interest in this company.
Agri Voedsel (Pioneer Foods)
Agri Voedsel is an unlisted investment holding company that owns a 30,5% economic interest in the JSE-listed
Pioneer Foods. During the period under review, Zeder increased its share in Agri Voedsel from 45,0% to 46,8%
for R63,7m. In line with its competitors, Pioneer Foods overall performance remained constrained by a
prolonged high commodity price cycle and structural challenges within the poultry industry. However, the core
divisions within the organisation are performing well and Zeder remains optimistic about Pioneer in the long
run. It is a leading food producer with strong fundamentals, which under new management remains well poised
to benefit from the growing demand for food and beverages, both in sub-Saharan Africa and select international
markets.
Pioneer Foods results can be viewed at www.pioneerfoods.co.za.
Kaap Agri
Kaap Agri is an unlisted retail, trade and services group which supplies a variety of products and services
to the agricultural sector and the general public. It has 154 operating points throughout South Africa, as well
as a growing exposure to the rest of Africa. Kaap Agris underlying performance remains encouraging and the
company produced satisfactory results for the six months ended 31 March 2013 with a 31,8% increase in headline
earnings per share. Zeder invested an additional R29m to increase its interest from 34,9% to 39,7% in Kaap Agri
during the period under review.
Kaap Agris results can be viewed at www.kaapagri.co.za.
Capespan
Capespan is an unlisted fruit and logistics group with a corporate history spanning more than 70 years. Its
core business activities are focused around the production, procurement, distribution and marketing of fruit
from more than 12 countries to customers in more than 60 countries around the world. Capespan continued to
deliver satisfactory results and reported an increase of 30% in recurring headline earnings per share for the
six months ended 30 June 2013. While the groups underlying performance remains stable, exposure to the
European markets and normal agricultural risks will need to be carefully monitored. Zeder remains optimistic
about Capespans growth potential in both its fruit and logistics divisions and has invested R353,3m to
increase its interest from 37,1% to 71,7% during the period under review.
Further information about Capespan can be viewed at www.capespan.co.za.
Zaad Holdings
Zeder owns a 92% interest in Zaad Holdings, a company that owns 100% of Agricol and 49% of Klein Karoo Seed
Marketing (KKS). Agricol is a seed business that has established itself in both the South African and
international markets for more than 50 years. KKS is a seed company that develops and distributes vegetable,
pasture and agronomic seed in developing countries, mainly Africa and the Middle East. KKS has offices and
research stations in, inter alia, South Africa, Zambia, Zimbabwe, Jordan and the Netherlands. The financial
performance of Zaad is encouraging, with a 71,8% growth in recurring headline earnings per share for the
period under review.
Zeder remains optimistic about the potential that the seed market offers, particularly in an African context
where the demand for agricultural inputs is expected to grow exponentially as it provides food for its own
needs, as well as the rest of the world.
Further information about Agricol and KKS can be viewed at www.agricol.co.za and www.seedmarketing.co.za
respectively.
Chayton Africa
Chayton Africa is a holding company which currently owns and operates large-scale commercial farming operations
in Zambia. The vision of this company is to own and operate vertically integrated grain-related agribusinesses
across Southern Africa. In less than 18 months, the company has managed to increase its productive farmland
under irrigation from 420 hectares to 4 200 hectares and is actively evaluating related development and
acquisitive opportunities on an ongoing basis in order to reach the needed scale. While the company remains
in the development phase, operational performance has been encouraging with actual agricultural yield results
exceeding expectations. Zeder believes that the demand for primary food in sub-Saharan Africa is strong and
sustainable and therefore remains optimistic about this investment.
Further information about Chayton Africa can be viewed at www.chaytonafrica.com.
Capevin Holdings (Distell)
Capevin Holdings (CVH) is a listed holding company with its core asset being an effective interest of 28,9%
in JSE-listed Distell. During the previous reporting period, Zeder announced its strategic decision to exit its
investment in CVH and reported its disposal of 15,1% in CVH for R799,8m. Since year-end, Zeder has obtained the
required shareholder approval and will dispose of its remaining 5,1% interest in CVH at the appropriate time.
Distells results can be viewed at www.distell.co.za.
DISPOSALS
In line with its refined strategy, Zeder has been in the process of disposing a number of its investments where
it had a small percentage share or minimal influence in the underlying companies. In the period under review,
Zeder entered into binding agreements that gave effect to the disposal of its entire shareholding in NWK and
Suidwes. The total proceeds of R325m from these disposals were received since the reporting date.
PSG MANAGEMENT FEE
As reported at year-end, PSG and Zeder shareholders engaged in a thorough process to restructure the management
fee payable to PSG. The process was completed prior to the AGM and Zeder shareholders approved a revised fee
arrangement, effective 1 March 2013.
For the period under review, Zeders results include a base management fee of R28,2m (2012: R28m) and a
performance fee of R26,1m (non-recurring headline cost), which have been calculated in terms of the revised fee
arrangement. The performance fee remains conditional upon Zeder outperforming a hurdle share price for the
financial year, which will only be determined at 28 February 2014. Management has, however, followed the prudent
approach to provide for same as the Zeder share price outperformed the hurdle price during the six months under
review.
PROSPECTS
We continue to believe that the agribusiness, food and beverage sectors offer rewarding investment opportunities,
both locally and abroad. It is for this reason that we are passionate about investment opportunities in Africa
and beyond.
DIVIDEND
It is Zeders policy to only declare a final dividend at year-end.
SUMMARY CONSOLIDATED INCOME STATEMENT
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Revenue from sale of goods 1 779,9 79,3 328,1
Cost of goods sold (1 484,2) (52,3) (234,4)
Gross profit 295,7 27,0 93,7
Income
Change in fair value of biological assets 29,2 28,7
Investment income 30,7 7,6 13,1
Net fair value gains 66,0 62,5 32,5
Other operating income 2,0 1,8 5,5
Total income 127,9 71,9 79,8
Expenses
Management fee (note 2) (54,3) (28,0) (58,6)
Marketing, administration and other expenses (266,7) (43,3) (120,1)
Total expenses (321,0) (71,3) (178,7)
Share of profits of associated companies 105,2 101,6 300,2
Loss on impairment of associated company (14,0)
Net loss on dilution of interest in associated companies (155,3)
Net gain on disposal of investment in associated companies 502,9
Profit before finance costs and taxation 193,8 129,2 642,6
Finance costs (31,3) (14,9) (37,2)
Profit before taxation 162,5 114,3 605,4
Taxation (46,7) (7,4) (95,9)
Profit for the period 115,8 106,9 509,5
Attributable to:
Owners of the parent 104,1 107,9 511,7
Non-controlling interests 11,7 (1,0) (2,2)
115,8 106,9 509,5
Reconciliation to headline earnings
Attributable to owners of the parent 104,1 107,9 511,7
Non-headline items (note 3) (31,7) (50,6) (315,4)
Headline earnings 72,4 57,3 196,3
Earnings per share (cents)
Attributable (basic and diluted) 10,6 11,0 52,3
Headline (basic and diluted) 7,4 5,9 20,1
Recurring headline (basic and diluted) 9,2 8,5 25,7
Weighted average number of shares (million) 979,3 978,1 978,1
SUMMARY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Profit for the period 115,8 106,9 509,5
Other comprehensive income for the period, net of taxation, which may
subsequently be reclassified to profit or loss 88,9 (1,1) 44,7
Currency translation adjustments 98,0 (1,2) 13,4
Fair value gains on available-for-sale investments 0,2 0,4
Share of other comprehensive income of associated companies 11,7 0,2 32,3
Recycling of other comprehensive income of associated companies (20,6) (1,2)
Recycling of fair value gains on disposal of available-for-sale investments (0,4)
Share of other equity movements of associated companies (0,1) (0,2)
Total comprehensive income for the period 204,7 105,8 554,2
Attributable to:
Owners of the parent 162,0 106,9 552,6
Non-controlling interests 42,7 (1,1) 1,6
204,7 105,8 554,2
SUMMARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
Rm Rm Rm
Assets
Non-current assets 3 188,1 3 294,8 2 838,5
Property, plant and equipment 746,0 352,5 381,8
Intangible assets 246,5 99,8 158,9
Investment in ordinary shares of associated companies 1 857,2 2 517,2 2 126,5
Loans to and preference share investments in associated companies 54,5 54,5 54,5
Investment in ordinary shares of joint ventures 0,4
Loans to joint ventures 4,0
Equity securities 124,1 250,6 100,5
Loans and advances 62,5 20,2 16,3
Employee benefits 29,0
Deferred income tax assets 63,9
Current assets 2 413,9 494,2 1 059,2
Biological assets 194,6 73,3 31,3
Inventories 292,7 113,4 174,6
Trade and other receivables 1 336,9 62,3 100,7
Current income tax receivable 4,4
Cash, money market investments and other cash equivalents 585,3 245,2 752,6
Non-current assets held for sale (note 5) 633,4 287,7
Total assets 6 235,4 3 789,0 4 185,4
Equity and liabilities
Ordinary shareholders' equity 3 409,6 2 870,5 3 283,5
Non-controlling interests 393,6 31,4 109,1
Total equity 3 803,2 2 901,9 3 392,6
Non-current liabilities 1 117,1 459,7 544,8
Deferred income tax 116,2 37,2 53,9
Borrowings 826,7 422,5 445,2
Derivative financial instrument 46,5 45,7
Employee benefits 127,7
Current liabilities 1 315,1 427,4 248,0
Borrowings 505,6 308,4 60,0
Trade and other payables 775,4 113,8 187,5
Current income tax payable 20,6 5,2 0,5
Employee benefits 13,5
Total liabilities 2 432,2 887,1 792,8
Total equity and liabilities 6 235,4 3 789,0 4 185,4
Net asset value per share (cents) 347,8 293,5 335,7
Tangible net asset value per share (cents) 322,7 283,3 319,5
Number of shares in issue (million) 980,2 978,1 978,1
SUMMARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Ordinary shareholders' equity at beginning of the period 3 283,5 2 817,0 2 817,0
Issue of shares 8,2
Total comprehensive income for the period 162,0 106,9 552,6
Transactions with non-controlling interests (5,0) (14,3) (47,0)
Dividend paid (39,1) (39,1) (39,1)
Ordinary shareholders' equity at end of the period 3 409,6 2 870,5 3 283,5
Non-controlling interests at end of the period 393,6 31,4 109,1
Non-controlling interests at beginning of the period 109,1
Transactions with non-controlling interests 241,8 32,5 107,5
Total comprehensive income/(loss) for the period 42,7 (1,1) 1,6
Total equity 3 803,2 2 901,9 3 392,6
Dividend per share (cents) 4,0
SUMMARY CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Net cash flow from operating activities (189,4) 56,9 44,8
Net cash flow from investment activities (163,0) (126,8) 386,3
Net cash flow from financing activities 163,7 237,6 242,7
Net (decrease)/increase in cash and cash equivalents (188,7) 167,7 673,8
Exchange gains on cash and cash equivalents 21,4 1,3
Cash and cash equivalents at beginning of the period 752,6 77,5 77,5
Cash and cash equivalents at end of the period 585,3 245,2 752,6
NOTES TO THE SUMMARY CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of presentation and accounting policies
These summary interim consolidated financial statements have been prepared in accordance with the recognition
and measurement principles of International Financial Reporting Standards ("IFRS") as issued by the
International Accounting Standards Board, including IAS 34 Interim Financial Reporting; the SAICA Financial
Reporting Guides, as issued by the Accounting Practices Committee; the Financial Reporting Pronouncements, as
issued by the Financial Reporting Standards Council; the requirements of the South African Companies Act 71
of 2008, as amended; and the Listings Requirements of the JSE Ltd.
The accounting policies applied in the preparation of these summary interim consolidated financial statements
are consistent in all material respects with those used in the prior financial year, apart from the following
new accounting standards and amendments to IFRSs which were relevant to the group's operations from
1 March 2013:
· IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Ventures and amendments to IAS 28 Investments in
Associates
The group has adopted aforementioned suite of IFRSs and amendments which deal with the accounting treatment
for the group's interests in its investees. The group has reviewed its accounting policies and concluded that
the adoption of same did not result in any material changes to the group's accounting for its investees.
· IFRS 13 Fair Value Measurement
The group has adopted the new standard on how to measure fair value and enhance fair value disclosures. The
adoption did not result in any material impact on the financial statements.
· Amendments to IAS 19 Employee Benefits
The amendments became relevant to the group following its acquisition of a controlling interest in Capespan
(refer note 4), which operates defined benefit plans. Capespan previously elected to follow a policy of
recognising remeasurements to employee benefit assets and liabilities in other comprehensive income, which
has now become mandatory.
· Amendments to IAS 34 Interim Financial Reporting
The amendments relate to the introduction of IFRS 13 Fair Value Measurement and changes to IFRS 7 Financial
Instruments: Disclosures. The group has complied with the requirements of the additional disclosures in these
interim financial statements.
The group also adopted the various other revisions to IFRS which are effective for the financial year ending
28 February 2014. These revisions have not resulted in material impacts to the group's reported results or
interim disclosures.
Enhanced disclosures, as required by IFRS 12 Disclosures of Interests in Other Entities, will be provided
in the annual financial statements for the year ending 28 February 2014.
2. Management fee
A management fee is payable to PSG Group, Zeder's ultimate holding company, in terms of a management
agreement. In accordance with the management agreement, PSG Group provides all investment, administrative,
advisory, financial and corporate services to the Zeder group of companies.
The management fee payable consists of a base fee and a performance fee element. The base fee is calculated
at the end of every half-year as 1.5% p.a (exclusive of VAT) of Zeder's volume weighted average market
capitalisation for that half-year. The performance fee is calculated at the end of the financial year as
20% p.a. on Zeder's share price outperformance of the GOVI yield plus 4%, adjusted for dividends.
3. Non-headline items
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Gross amounts
Net loss on dilution of interest in associated companies 155,3
Share of non-headline items of associated companies (25,3) (32,6) (42,8)
Fair value adjustment on step-up acquisition of a subsidiary (40,7) (22,0) (22,0)
Impairment of investment in associated companies 14,0
Net gain on disposal of investments in associated companies (502,9)
Other 0,1 4,0 5.5
Non-controlling interest 0,1 0,2
Taxation 20,1 91,3
(31,7) (50,6) (315,4)
4. Business combination
Capespan
Effective April 2013, the group acquired a further 25,3% shareholding in Capespan and thereby increased its
interest to 71,1%. At the reporting date, the group held 71,7% in Capespan. Capespan is a global fruit
procurement company and South Africa's largest fruit exporter. The remeasurement of the previously held
interest in an associated company resulted in a non-headline gain of R40,7m being recognised in net fair
value gains in the income statement. The summarised assets and liabilities recognised at acquisition
date were:
Rm
Property, plant and equipment 308,3
Biological assets 148,2
Intangible assets 59,5
Investment in ordinary shares of associated companies 173,3
Equity securities 3,5
Loans and advances 49,4
Deferred income tax assets 61,8
Inventories 93,8
Trade and other receivables 971,8
Cash, money market investments and other cash equivalents 313,0
Non-current assets held for sale 10,1
Borrowings (578,7)
Deferred income tax liability (32,5)
Trade and other payables (540,2)
Income tax payables (25,6)
Employee benefits (93,3)
Total identifiable net assets 922,4
Non-controlling interest at fair value (270,3)
Previously held investment in Capespan at fair value (403,0)
Goodwill 8,9
Total consideration 258,0
Cash consideration paid (258,0)
Cash and cash equivalents acquired 313,0
Net cash inflow from business combination 55,0
Goodwill recognised from the business combination can be attributed to the employee corps, geographical
footprint and growth potential of Capespan. Acquisition costs of R1,1m were incurred with the above business
combination, which are included in marketing, administration and other expenses in the income statement.
5. Non-current assets held for sale
Non-current assets held for sale consists mainly of the following:
Zeder holds JSE-listed equity securities in CVH with a carrying value of R312.1m. These equity securities
were classified as held for sale during the previous financial year.
At the reporting date, Zeder was in process of disposing of its interests in NWK and Suidwes. These
investments, being associated companies, were classified as held for sale and their aggregate carrying value
at the reporting date amounted to R311,2m. Since the reporting date, Zeder entered into binding agreements
that gave effect to these disposals. The total proceeds from these disposals will approximate R325m and is
expected to materialise before the end of October 2013.
6. Preparation
These summary consolidated financial statements were compiled under the supervision of the group financial
director, Mr WL Greeff, CA(SA), and were not reviewed or audited by Zeder's external auditor,
PricewaterhouseCoopers Inc.
7. Financial instruments
7.1 Financial risk factors
The group's activities expose it to a variety of financial risks; market risk (including currency risk, fair
value interest rate risk, and price risk), credit risk and liquidity risk.
The summary interim financial statements do not include all financial risk management information and
disclosures required in the annual financial statements, and therefore they should be read in conjunction
with the groups annual financial statements as at 28 February 2013. Risk management continues to be carried
out by each major entity within the group under policies approved by the respective boards of directors.
7.2 Fair value estimation
The information below analyses financial assets and financial liabilities, which are carried at fair value,
by level of hierarchy as required by IFRS 7 and IFRS 13. The different levels in the hierarchy are defined
below:
Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1)
Inputs other than quoted prices included within level 1 that are observable for the asset or liability,
either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2)
Inputs for the asset or liability that are not based on observable market data (that is, unobservable
inputs) (level 3)
The fair value of financial assets and liabilities carried at amortised cost approximates their fair value,
while those measured at fair value in the statement of financial position can be summarised as follows:
Level 1 Level 2 Level 3 Total
Rm Rm Rm Rm
Assets
Equity securities 1,0 119,6 3,5 124,1
Liabilities
Derivative financial liabilities 46,5 46,5
There have been no significant transfers between level 1, 2 or 3 during the period under review, nor were
there any significant changes to the valuation techniques and inputs used to determine fair values.
Non-current assets held for sale include assets measured at fair value, as set out in note 5, which is based
on the JSE-listed share price or other observable inputs.
8. Segmental reporting
At 28 February 2013, the group was organised into four reportable segments, namely i) Zaad Holdings,
ii) Chayton, iii) food and agri, and iv) beverages. Zaad Holdings and Chayton are subsidiaries, while food
and agri and beverages comprises investments in associated companies and equity securities.
Following Zeder obtaining a controlling interest in Capespan (refer note 4), the chief operating
decision-maker (being PSG Groups executive committee, which manages the group) has revised their
segmentation of how they review segments performance and allocate capital. This revision resulted in the
reportable segments being restated to consist of the following: i) food, beverages and related services,
ii) agri related retail, trade and services, iii) agri inputs and iv) agri production.
Recurring headline earnings is calculated on a see-through basis. Zeder's recurring headline earnings is the
sum of its effective interest in that of each of its underlying investments. The result is that investments
which Zeder do not equity account or consolidate in terms of accounting standards, are included in the
calculation of recurring headline earnings.
The segments represent different sectors in the broad agribusiness industry. The segment report set out
below was compiled based on the revised segmentation and comparatives have been restated accordingly. These
restatements had no impact on reported amounts of profit or loss, assets, liabilities, equity or cash flows.
Non-recurring headline earnings include equity securities' see-through recurring headline earnings and the
related net fair value gains/losses and investment income (as recognised in the income statement).
Associated companies' and subsidiaries' one-off gains/losses are excluded from recurring headline earnings
and included in non-recurring headline earnings.
Segmental income comprises revenue from sale of goods and investment income, as per the income statement.
Sum-of-the-parts ("SOTP") is a key valuation tool used to measure Zeders performance. In determining SOTP,
listed assets and liabilities are valued using quoted market prices, whereas unlisted assets and liabilities
are valued using appropriate valuation methods. These values will not necessarily correspond with the values
per the statement of financial position since the latter are measured using the relevant accounting standards
which include historical cost and the equity accounting method.
Unaudited Audited
Aug 2013 Aug 2012 Feb 2013
6 months 6 months 12 months
Rm Rm Rm
Recurring headline earnings
Food, beverages and related services 80,3 71,1 205,7
Agri-related retail, trade and services 42,0 56,2 120,4
Agri-inputs 11,5 2,4 28,7
Agri-production (9,9) (8,4) (21,8)
Net interest, taxation and other income and expenses (6,0) (10,2) (23,3)
Management fee (28,2) (28,0) (58,6)
Recurring headline earnings 89,7 83,1 251,1
Non-recurring headline earnings, net of taxation (17,3) (25,8) (54,8)
Recurring earnings adjustment 3,0 17,4 (8,6)
One-off items
Pioneer Foods BBBEE charge (9,6) (22,2) (22,2)
Suidwes incentive scheme expense (7,2)
Distell excise duty charge (12,6) (12,6)
Agri Voedsel unbundling costs (6,1) (6,1)
Other (3,5) (2,3) (5,3)
Headline earnings 72,4 57,3 196,3
Non-headline items (note 3) 31,7 50,6 315,4
Attributable earnings 104,1 107,9 511,7
SOTP segmental analysis:
Segments
Food, beverages and related services 2 721,1 2 316,1 2 047,0
Agri-related retail, trade and services 977,0 838,2 819,4
Agri-inputs 368,9 182,4 368,9
Agri-production 293,3 276,9 276,9
Cash and cash equivalents 216,6 32,8 692,2
Other net liabilities (324,3) (408,8) (301,1)
SOTP value 4 252,6 3 237,6 3,903,3
Income segmental analysis:
Food, beverages and related services* 1 592,1 - -
Revenue from sale of goods* 1 577,2
Investment income* 14,9
Agri-related retail, trade and services
Investment income 3,4 4,1 5,9
Agri-inputs 114,8 79,6 266,6
Revenue from sale of goods 112,8 78,8 264,7
Investment income 2,0 0,8 1,9
Agri-production 90,4 0,5 63,7
Revenue from sale of goods 89,9 0,5 63,4
Investment income 0,5 0,3
Unallocated investment income 9,9 2,7 5,0
IFRS revenue 1 810,6 86,9 341,2
* Note that these results include the first-time consolidation of Capespan
DIRECTORS:
JF Mouton (Chairman)**, N Celliers* (CEO), WL Greeff* (FD), AE Jacobs**, PJ Mouton**, GD Eksteen#,
MS du P le Roux#, CA Otto#, LP Retief#
7 October 2013
* executive
** non-executive
# independent non-executive
Secretary and registered office:
PSG Corporate Services (Pty) Ltd,
1st Floor, Ou Kollege, 35 Kerk Street, Stellenbosch, 7600,
PO Box 7403, Stellenbosch, 7599
Transfer secretaries:
Computershare Investor Services (Pty)Ltd, 70 Marshall Street, Johannesburg, 2001,
PO Box 61051, Marshalltown, 2107
Sponsor: PSG Capital
Website: www.zeder.co.za
Date: 07/10/2013 02:08:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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