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ZEDER INVESTMENTS LIMITED - Condensed Unaudited Interim Results For The Six Months Ended 31 August 2017

Release Date: 04/10/2017 13:15
Code(s): ZED     PDF:  
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Condensed Unaudited Interim Results For The Six Months Ended 31 August 2017

Zeder Investments Limited
Incorporated in the Republic of South Africa
(Registration number: 2006/019240/06)
JSE Ltd ("JSE") share code: ZED
ISIN number: ZAE000088431
("Zeder" or "the group")

CONDENSED UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2017

HIGHLIGHTS
- SOTP value per share R7,17 as at 26 September 2017
- Recurring headline earnings decreased by 74,5% to 3,8 cents per share
- Headline earnings decreased by 69,9% to 4,3 cents per share

OVERVIEW
Zeder is an investor in the broad agribusiness industry, with a specific focus on the food and
beverage sectors. Its underlying investment portfolio was valued at R14,1bn on 31 August 2017.
Zeder's 27,0% interest in Pioneer Foods remains its largest investment, representing 52,3%
(28 February 2017: 62,7%) of the portfolio.

STRATEGY
Zeder is a long-term investor that owns large, strategic interests in companies and plays an active
role therein. It assists with the determination of appropriate long-term strategies, optimal allocation
of capital and ongoing measurement and monitoring of performance. During the period under review, it
dedicated most of its efforts to existing investments while evaluating select new and adjacent
opportunities. Zeder continues to drive for additional growth from its existing investment platforms
while aiming to add to its portfolio when opportune.

PERFORMANCE OF PORTFOLIO COMPANIES
Zeder and its portfolio companies traded under challenging macro conditions during the period under
review. Its largest investment, Pioneer Foods, reported weaker earnings for the six-month period ended
31 March 2017, due to the aforementioned and, in part, factors that are unlikely to reoccur.
Additionally, the first six months of Zeder’s earnings reflect the annual input-cost cycle associated
with many of its unlisted agriculture and food business investments. This period therefore represents
the lesser half of earnings while making year-on-year comparisons at the interim stage challenging due
to seasonal variances.

Combined, these factors weighed heavily on Zeder as consolidated recurring headline earnings decreased
compared to the same period in the prior year. Earnings growth from Kaap Agri and Quantum Foods were
offset by declines from Pioneer Foods, Capespan, Zaad and Agrivision. Notwithstanding these challenges
and interim financial results, most portfolio companies delivered against operational targets and
should improve or recover during the next reporting cycle.

PROSPECTS
Zeder remains actively involved with its underlying portfolio of companies and continuously seeks new
investment opportunities. We believe that, despite inevitable cyclicality, investing in the
agribusiness industry should offer attractive long-term returns and the strength of our companies and
management teams, combined with a defensive portfolio mix, should contribute to the continued
sustainability of results. We believe that the company and its shareholders will benefit from same. 

FINANCIAL RESULTS
The two key benchmarks which Zeder believes to measure performance by are SOTP value per share and
recurring headline earnings per share.

SUM-OF-THE-PARTS ("SOTP")
Zeder's SOTP value per share, calculated using the quoted market prices for all JSE-listed investments,
and market-related valuations for unlisted investments, decreased by 9,5% during the reporting period
to R7,72 as at 31 August 2017. At the close of business on Tuesday, 26 September 2017, Zeder's SOTP
value per share was R7,17.

                                    28 Feb 2017             31 Aug 2017             26 Sep 2017
Company                        Interest (%)         Rm Interest (%)         Rm Interest (%)         Rm

Pioneer Foods                         27,1       9 538        27,0       7 377        27,0       6 553
Capespan                              98,1       1 975        97,5       2 277        97,5       2 277
Zaad                                  91,4       1 531        93,2       2 043        93,2       2 043
Kaap Agri                             39,8       1 321        39,8       1 563        39,8       1 465
Agrivision                            55,6         614        55,9         614        55,9         614
Quantum Foods                         26,7         193        27,0         199        27,0         185
Other                                               39                      39                      39
Total investments                               15 211                  14 112                  13 176
Cash                                               173                      75                      66
Other net liabilities                             (678)                   (876)                   (874)
SOTP value                                      14 706                  13 311                  12 368

Number of shares in issue (net
  of treasury shares) (million)                  1 725                   1 725                   1 725

SOTP value per share (rand)                       8,53                    7,72                    7,17

Note: Zeder’s live SOTP is available at www.zeder.co.za.

Recurring headline earnings
Zeder’s consolidated recurring headline earnings is the sum of its effective interest in that of each
of its underlying investments. The result is that investments in which Zeder holds less than 20% and
are generally not equity accountable in terms of accounting standards, are included in the calculation
of consolidated recurring headline earnings, whilst once-off (i.e. non-recurring) income and expenses
are excluded. This provides management and investors with a more realistic and transparent way of
evaluating Zeder’s earnings performance. 

                                                                  Audited         Unaudited
                                                              28 Feb 2017   31 Aug 2016    31 Aug 2017
                                                                12 months      6 months       6 months
                                                                       Rm            Rm             Rm

Recurring headline earnings from investments                          821           314            115
Management (base) fee                                                 (75)          (75)
Net interest, taxation and other income and expenses                  (55)          (11)           (50)
Recurring headline earnings                                           691           228             65
Non-recurring headline earnings
  Management fee internalisation charge                            (1 449)
  Other                                                               (12)          (10)             9
Headline (loss)/earnings                                             (770)          218             74
Non-headline items                                                    (26)           (4)            53
Attributable (loss)/earnings                                         (796)          214            127

Weighted average number of shares in issue
  (net of treasury shares) (million)                                1 622         1 523          1 722

Recurring headline earnings per share (cents)                        42,6          14,9            3,8

Headline (loss)/earnings per share - basic (cents)                  (47,5)         14,3            4,3

Attributable (loss)/earnings per share - basic (cents)              (49,1)         14,0            7,4

Recurring headline earnings per share decreased by 74,5% to 3,8 cents.

Headline earnings per share decreased by 69,9% to 4,3 cents mainly as a result of the above, offset by
a lower BEE charge incurred by Pioneer Foods.

Attributable earnings per share decreased by 47,1% to 7,4 cents, a lower percentage than headline
earnings per share, mainly due to a non-headline profit on disposal of underlying business operations
at a subsidiary level.

DIVIDEND
It is currently Zeder’s policy to only declare a final dividend at year-end.


CONDENSED CONSOLIDATED INCOME STATEMENT

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

Revenue                                                             4 440         4 912         10 209
Cost of sales                                                      (3 863)       (4 201)        (8 546)
Gross profit                                                          577           711          1 663

Income
Changes in fair value of biological assets                             39           115            224
Investment income                                                      33            26             67
Net fair value gains/(losses)                                          17             4             (7)
Other operating income                                                 98            17             29
Total income                                                          187           162            313

Expenses
Management fees                                                                     (75)           (75)
Management fee internalisation charge (note 2)                                                  (1 449)
Marketing, administration and other expenses                         (738)         (799)        (1 562)
Total expenses                                                       (738)         (874)        (3 086)

Net income from associates and joint ventures
Share of profits of associates and joint ventures                     226           321            629
Net loss on dilution of interest in associates                        (20)           (4)            (8)
Net income from associates and joint ventures                         206           317            621

Profit/(loss) before finance costs and taxation                       232           316           (489)
Finance costs                                                        (144)         (104)          (232)
Profit/(loss) before taxation                                          88           212           (721)
Taxation                                                               26            34            (21)
Profit/(loss) for the period                                          114           246           (742)

Attributable to:
 Owners of the parent                                                 127           214           (796)
 Non-controlling interests                                            (13)           32             54
                                                                      114           246           (742)
EARNINGS PER SHARE AND NUMBER OF SHARES IN ISSUE

Earnings/(loss) per share (cents)
 Recurring headline                                                   3.8          14.9           42.6
 Headline (basic) (note 3)                                            4.3          14.3          (47.5)
 Headline (diluted)                                                   3.8          13.0          (49.7)
 Attributable (basic)                                                 7.4          14.0          (49.1)
 Attributable (diluted)                                               6.8          12.8          (51.3)

Number of shares (m)
 In issue                                                           1 731         1 523          1 731
 In issue (net of treasury shares)                                  1 725         1 523          1 725
 Weighted average                                                   1 722         1 523          1 622
 Diluted weighted average                                           1 724         1 523          1 624

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

Profit/(loss) for the period                                          114           246           (742)

Other comprehensive income for the period, net of taxation             33          (144)          (470)
 Items that may be reclassified to profit or loss
  Currency translation adjustments                                    (11)         (156)          (423)
  Share of other comprehensive income of associates                    31            12            (43)
 Items that may not be reclassified to profit or loss
  Gains/(losses) from changes in financial and demographic
    assumptions of post-employment benefit obligations                 13                           (4)
Total comprehensive income for the period                             147           102         (1 212)

Attributable to:
 Owners of the parent                                                 167            98         (1 193)
 Non-controlling interests                                            (20)            4            (19)
                                                                      147           102         (1 212)

CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                       Rm            Rm            Rm

Assets

Non-current assets                                                 10 392         9 664          9 835
Property, plant and equipment                                       1 624         1 601          1 640
Intangible assets                                                     675           656            666
Biological assets (bearer plants)                                     397           313            364
Investment in ordinary shares of associates and joint ventures      7 180         6 780          6 833
Loans to associates and joint ventures                                235            64             80
Equity securities                                                      45            47             46
Loans and advances                                                    113            82            111
Deferred income tax assets                                             85            78             58
Employee benefits                                                      38            43             37

Current assets                                                      3 537         3 963          3 336
Biological assets (agricultural produce)                               71            86            122
Inventories                                                         1 160         1 245          1 319
Loans and advances                                                     28            22             36
Trade and other receivables                                         1 836         2 045          1 414
Current income tax assets                                              38            24             23
Cash, money market investments and other cash equivalents             404           541            422

Non-current assets held for sale                                       19

Total assets                                                       13 948        13 627         13 171

Equity and liabilities

Ordinary shareholders' equity                                       8 311         8 266          8 291
Non-controlling interests                                             370           360            407
Total equity                                                        8 681         8 626          8 698

Non-current liabilities                                             1 265         1 529          1 320
Deferred income tax liabilities                                        83            80             94
Borrowings                                                          1 039         1 238          1 015
Derivative financial liabilities                                       42            69             94
Employee benefits                                                     101           142            117

Current liabilities                                                 4 002         3 472          3 153
Borrowings                                                          2 669         1 886          1 958
Trade and other payables                                            1 247         1 501          1 092
Current income tax liabilities                                         27            31             37
Employee benefits                                                      59            54             66
 
Total liabilities                                                   5 267         5 001          4 473

Total equity and liabilities                                       13 948        13 627         13 171


Net asset value per share (cents)                                   481.8         542.7          480.6
Tangible asset value per share (cents)                              442.7         499.7          442.0

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

Ordinary shareholders' equity at beginning of the period            8 291         8 251          8 251
Shares issued                                                                                    1 449
Total comprehensive income for the period                             167            98         (1 193)
Transactions with non-controlling interests                            37            48            (37)
Net movement in treasury shares                                         2                          (50)
Other movements                                                         4             6              8
Dividends paid                                                       (190)         (137)          (137)
Ordinary shareholders' equity at end of the period                  8 311         8 266          8 291

Non-controlling interests at beginning of the period                  407           442            442
Shares issued                                                          10            21             25
Total comprehensive income for the period                             (20)            4            (19)
Transactions with non-controlling interests                           (12)         (100)           (31)
Other movements                                                         2             5              3
Dividends paid                                                        (17)          (12)           (13)
Non-controlling interests at end of the period                        370           360            407

Total equity                                                        8 681         8 626          8 698

Dividend per share (cents)                                                                        11.0

CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

Cash (utilised by)/generated from operations (note 4)                (232)         (294)            97
Investment income                                                     108            92            314
Finance cost and taxation paid                                       (132)         (119)          (235)
Cash flow from operating activities                                  (256)         (321)           176

Acquisition of subsidiaries                                                                       (115)
Acquisition of associates and joint ventures                         (172)          (38)          (109)
Loans to associates and joint ventures                                 (3)          (64)           (69)
Acquisition of equity securities                                                                    (1)
Additions to property, plant and equipment                            (94)         (180)          (311)
Additions to intangible assets                                        (36)          (39)           (89)
Proceeds from disposal of subsidiaries' operations (note 5)            27
Proceeds from disposal of property, plant and equipment                 2             2             35
Other                                                                  16           (50)           (66)
Cash flow from investing activities                                  (260)         (369)          (725)

Capital contributions by non-controlling interests                      4            21             25
Purchase of treasury shares                                                                        (62)
Treasury shares sold                                                    2                           11
Dividends paid to group shareholders                                 (190)         (137)          (137)
Dividends paid to non-controlling interests                           (17)          (12)           (13)
Borrowings repaid                                                    (160)         (292)          (289)
Borrowings drawn                                                      869         1 040            866
Other                                                                 (17)          (51)           (53)
Cash flow from financing activities                                   491           569            348

Net decrease in cash and cash equivalents                             (25)         (121)          (201)
Exchange differences on cash and cash equivalents                       7           (22)           (61)
Cash and cash equivalents at beginning of the period                  422           684            684
Cash and cash equivalents at end of the period                        404           541            422

NOTES TO THE CONDENSED CONSOLIDATED INTERIM FINANCIAL STATEMENTS

1. Basis of presentation and accounting policies

   These condensed consolidated interim 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.

   The condensed consolidated interim financial statements do not include all of the information
   required for full consolidated annual financial statements and should be read in conjunction with
   the consolidated financial statements for the year ended 28 February 2017.

   The accounting policies applied in the preparation of these condensed consolidated interim
   financial statements are consistent in all material respects with those used in the prior year's
   annual financial statements. The group adopted the various revisions to IFRS which were effective
   for its financial year ending 28 February 2017 however, these revisions have not resulted in material
   changes to the group's reported financial interim results or disclosures.

   In preparing these condensed consolidated interim financial statements, the significant judgements
   made by management in applying the group's accounting policies and the key sources of estimation
   uncertainty were similar to those disclosed in the consolidated annual financial statements for the
   year ended 28 February 2017.

2. Management fee internalisation charge

   During the prior financial year, and effective 1 September 2016, Zeder shareholders voted in favour of
   acquiring the rights to the management agreement from PSG Group Ltd ("PSG Group") in exchange for the
   issue of 207 661 758 ordinary shares, valued at R1,45bn. The rights to the acquired management
   agreement, did not meet the recognition criteria for intangible assets in terms of IFRS, and was
   consequently accounted for in the income statement as a non-recurring headline expense. It should be
   noted that this was a once-off charge, with no further management fees payable to the PSG Group in
   terms of this agreement.

3. Headline earnings/(loss)

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

   Profit/(loss) for the period attributable to owners
     of the parent                                                    127           214           (796)
   Non-headline items                                                 (53)            4             26
    Gross amounts
     Non-headline items of associates and joint ventures               (7)           (1)            12
     Loss on dilution of interest of associate                         20             4              8
     Profit on disposal of subsidiaries' operations (note 5)          (80)
     Profit on sale of property, plant and equipment                   (1)                          (1)
     Impairment of property, plant and equipment                        5                            3
     Impairment of intangible assets and goodwill                       7             1              5
     Other                                                              1                            1
    Non-controlling interests                                           2                           (2)
   Headline earnings/(loss)                                            74           218           (770)

4. Cash (utilised by)/generated from operations

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

   Profit/(loss) before taxation                                       88           212           (721)
   Management fee internalisation                                                                1 449
   Share of profits of associates and joint ventures                 (226)         (321)          (629)
   Profit on disposal of subsidiaries' operations (note 5)            (80)
   Net loss on dilution of interest in associates                      20             4              8
   Investment income                                                  (33)          (26)           (67)
   Finance costs                                                      144           104            232
   Depreciation and amortisation                                       98            90            180
   Changes in fair value of biological assets                         (39)         (115)          (224)
   Net harvest short-term biological assets                            60            67             67
   Other non-cash items                                                (3)           18            (15)
                                                                       29            33            280
   Changes in working capital and other financial instruments        (154)         (209)            68
   Additions to biological assets                                    (107)         (118)          (251)
   Cash (utilised by)/generated from operations                      (232)         (294)            97

5. Subsidiaries' operations sold

   During July 2017, the group, through Capespan Group Ltd (“Capespan”) merged its Asian operations with
   Golden Wing Mau to form JWM Asia. Capespan therefore sold 70% of its business operations to JWM Asia
   and retained a 30% shareholding in JWM Asia.

   Capespan, sold the business operations of Capespan Japan Ltd ("Capespan Japan"), a fruit marketing
   company situated in Japan, to JWM Asia, for a cash consideration of R3m.

   Capespan, sold the business operations of Metspan Hong Kong Ltd ("Metspan"), a fruit marketing
   company situated in Hong Kong, to JWM Asia, for a cash consideration of R57m.

   The summarised assets and liabilities recognised at the respective disposal dates were:

                                                                                  Unaudited
                                                                 Capespan
                                                                    Japan       Metspan          Total
                                                                       Rm            Rm             Rm

   Property, plant and equipment                                        1             1              2
   Intangible assets                                                    1            11             12
   Loans and advances                                                   1             1              2
   Inventories                                                         16             6             22
   Trade and other receivables                                         73            82            155
   Cash, money market investments and other cash equivalents           18            15             33
   Trade and other payables                                           (34)          (63)           (97)
   Current income tax liabilities                                                    (1)            (1)
   Total identifiable net assets                                       76            52            128
   Transfer to investment in ordinary shares of associates                          (26)           (26)
   Transfer to loans to associated companies                          (73)          (49)          (122)
   Profit on disposal of subsidiaries' operations                                    80             80
   Total cash consideration received                                    3            57             60
   Cash and cash equivalents of subsidiaries' operations disposed     (18)          (15)           (33)
   Net cash flow on disposal of subsidiaries' operations              (15)           42             27

6. Financial instruments

6.1  Financial risk factors

   The group's activities expose it to a variety of financial risks: market risk (including currency
   risk, cash flow and fair value interest rate risk, and price risk), credit risk and liquidity risk.

   The condensed consolidated interim financial statements do not include all financial risk management
   information and disclosures set out in the consolidated annual financial statements, and therefore
   they should be read in conjunction with the group's annual financial statements for the year ended
   28 February 2017. Risk management continues to be carried out throughout the group under policies
   approved by the respective boards of directors.

6.2  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 13. The different levels in the hierarchy are
   defined below:

   Level 1

   The fair value of financial instruments traded in active markets is based on quoted market prices at
   the reporting date. A market is regarded as active if quoted prices are readily and regularly
   available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency,
   and those prices represent actual and regularly occurring market transactions on an arm's length
   basis. The quoted market price used for financial assets held by the group is the current bid price.

   Level 2

   Financial instruments that trade in markets that are not considered to be active but are valued
   (using valuation techniques) based on quoted market prices, dealer quotations or alternative
   pricing sources supported by observable inputs are classified within level 2. These include
   over-the-counter traded financial instruments. As level 2 investments include positions that are
   not traded in active markets and/or are subject to transfer restrictions, valuations may be
   adjusted to reflect illiquidity and/or non-transferability, which are generally based on available
   market information. If all significant inputs in determining an instrument's fair value are
   observable, the instrument is included in level 2.

   Level 3
 
   If one or more of the significant inputs is not based on observable market data, the instrument is
   included in level 3. Investments classified within level 3 have significant unobservable inputs,
   as they trade infrequently.

   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:

                                                                               Unaudited
                                                           Level 1     Level 2     Level 3      Total
                                                                Rm          Rm          Rm         Rm
   31 August 2017

   Assets
   Equity securities                                                                    45          45
    Opening balance                                                          1          44
    Transfer between levels                                                 (1)          1

   Liabilities
   Derivative financial liabilities                                                     42          42
    Opening balance                                                                     94
    Transactions with non-controlling interests                                        (50)
    Fair value gains                                                                    (7)
    Finance cost                                                                         5

   31 August 2016

   Assets
   Equity securities                                                         1          46          47
    Opening balance                                                                     72
    Disposals                                                                          (23)
    Fair value losses                                                                   (3)

   Liabilities
   Derivative financial liabilities                                          1          68          69
    Opening balance                                                                     65
    Finance cost                                                                         3

                                                                                Audited
                                                          Level 1     Level 2      Level 3       Total
                                                               Rm          Rm           Rm          Rm
   28 February 2017

   Assets
   Equity securities                                                        1           44          45
    Opening balance                                                                     72
    Disposals                                                                          (23)
    Fair value losses                                                                   (5)

   Liabilities
   Derivative financial liabilities                                                     94          94
    Opening balance                                                                     65
    Additions                                                                           25
    Fair value gains                                                                    (3)
    Finance cost                                                                         7

7. Segmental reporting

   The group is organised into four reportable segments, namely i) food, beverages and related
   services, ii) agri - related retail, trade and services, iii) agri - inputs and
   iv) agri - production. The segments represent different sectors in the broad agribusiness industry.

   Headline earnings comprise recurring and non-recurring headline earnings. Recurring headline
   earnings (being a measure of segment profit) is calculated on a see-through basis. Zeder's
   recurring headline earnings is the sum of its effective interest in each of its underlying
   investments. The result is that investments which Zeder does not equity account or consolidate in
   terms of accounting standards, are included in the calculation of recurring headline earnings.

   Non-recurring headline earnings include the elimination of equity securities' see-through recurring
   headline earnings not equity accounted, the related net fair value gains/losses and investment
   income (as recognised in the income statement). Associates' and subsidiaries' once-off gains/losses
   are excluded from recurring headline earnings and included in non-recurring headline earnings.

   Segmental income comprises revenue and investment income, as per the income statement.

   SOTP is a key valuation tool used to measure Zeder's performance. The SOTP value is calculated
   using the quoted market prices for all JSE-listed investments, and market-related valuations for
   unlisted investments. 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.

   The chief operating decision-maker (executive committee) evaluates the following information to
   assess the segments' performance:

                                                                           Unaudited           Audited
                                                                   Aug 17        Aug 16         Feb 17
                                                                 6 months      6 months      12 months
                                                                       Rm            Rm             Rm

   Recurring headline earnings segmental analysis:

    Food, beverages and related services                               85           253            582
    Agri-related retail, trade and services                            50            45             89
    Agri-inputs                                                        (6)           (5)           124
    Agri-production                                                   (14)           21             26
   Recurring headline earnings from investments                       115           314            821
   Management (base) fee                                                            (75)           (75)
   Net interest, taxation and other income and expenses               (50)          (11)           (55)
   Recurring headline earnings                                         65           228            691
   Non-recurring headline earnings
    Management fee internalisation charge                                                       (1 449)
    Other                                                               9           (10)           (12)
   Headline earnings/(loss)                                            74           218           (770)
   Non-headline items (note 3)                                         53            (4)           (26)
   Attributable earnings/(loss)                                       127           214           (796)

   SOTP segmental analysis:

   Segments
    Food, beverages and related services                            9 853        12 140         11 706
    Agri-related retail, trade and services                         1 602           922          1 360
    Agri-inputs                                                     2 043         1 310          1 531
    Agri-production                                                   614           614            614
   Cash and cash equivalents                                           75             2            173
   Other net liabilities                                             (876)         (607)          (678)
   SOTP value - pre management fee liability                       13 311        14 381         14 706
   Management fee liability*                                                     (1 961)
   SOTP value - post management fee liability                      13 311        12 420         14 706

   * Calculated at 12% newly issued Zeder shares multiplied by Zeder SOTP value per share.

   SOTP value per share (rand)
    Pre management fee liability                                                   9.44
    Post management fee liability                                    7.72          8.15           8.53

   Profit/(loss) before tax segmental analysis:

   Segments
    Food, beverages and related services                              172           257            638
    Agri-related retail, trade and services                            46            47             89
    Agri inputs                                                       (27)          (22)           123
    Agri-production                                                   (39)           20             29
    Management fees and other income and expenses                     (64)          (90)        (1 600)
                                                                       88           212           (721)

   IFRS revenue (revenue and investment income) segmental analysis:

   Segments
   Food, beverages and related services                             3 729         4 179          8 359
    Revenue                                                         3 710         4 161          8 311
    Investment income                                                  19            18             48
   Agri-inputs                                                        503           481          1 325
    Revenue                                                           495           477          1 314
    Investment income                                                   8             4             11
   Agri-production                                                    235           275            585
    Revenue                                                           235           275            584
    Investment income                                                                                1
   Unallocated investment income (mainly head
     office interest income)                                            6             3              6
   IFRS revenue                                                     4 473         4 938         10 275

8. Related-party transactions

   Related-party transactions similar to those disclosed in the consolidated annual financial
   statements for the year ended 28 February 2017 took place during the period under review.

9. Events subsequent to the reporting date

   No material event occurred between the end of the reporting period and the date of approval of these
   condensed consolidated interim financial statements.

10.Preparation

   These condensed consolidated interim financial statements were compiled under the supervision of the
   financial director, Mr JH le Roux, CA (SA), and were not reviewed or audited by the group's external
   auditor, PricewaterhouseCoopers Inc.

Signed on behalf of the board

Jannie Mouton                                            Norman Celliers
Chairman                                                 Chief executive officer

Stellenbosch
4 October 2017

DIRECTORS
JF Mouton (Chairman), N Celliers* (CEO), JH le Roux* (FD), GD Eksteen#, WL Greeff, ASM Karaan#,
NS Mjoli-Mncube#, PJ Mouton, CA Otto#
*   executive
#   independent non-executive

COMPANY SECRETARY AND REGISTERED OFFICE
Zeder Corporate Services (Pty) Ltd
2nd Floor, Ou Kollege, 35 Kerk Street, Stellenbosch, 7600
PO Box 7403, Stellenbosch, 7599

TRANSFER SECRETARY
Computershare Investor Services (Pty) Ltd
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
PO Box 61051, Marshalltown, 2107

SPONSOR
PSG Capital (Pty) Ltd

AUDITOR
PricewaterhouseCoopers Inc.

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