To view the PDF file, sign up for a MySharenet subscription.

PREMIER FISHING AND BRANDS LIMITED - Unaudited Condensed Interim Group Results For The Six Months Ended 28 February 2018

Release Date: 17/05/2018 14:10
Code(s): PFB     PDF:  
Wrap Text
Unaudited Condensed Interim Group Results For The Six Months Ended 28 February 2018

Premier Fishing and Brands Limited  
(previously Premier Food and Fishing Limited)
(Incorporated in the Republic of South Africa)
Registration number 1998/018598/06
Share code: PFB and ISIN: ZAE000247516
("Premier" or "the Group" or "the Company")

Unaudited Condensed Interim Group results for the six months ended 28 February 2018

Highlights compared to the prior year:

-  Gross profit increased by 7% to R76 million from R71 million
-  Operating profit increased by 14% to R20 million from R18 million
-  Profit after tax increased by 59% to R29 million from R18 million
-  Maiden gross dividend of 15 cents per share paid to shareholders on 5 February 2018
-  The Acquisition of Talhado Fishing Enterprises (Pty) Ltd has been finalised

Condensed Group Statement of Profit and Loss and Other Comprehensive Income

                                                                             Unaudited     Unaudited      Audited
                                                                                 Group         Group        Group
                                                                           28 February   28 February    31 August
                                                                                  2018          2017         2017
                                                                              6 months      6 months    12 months
                                                                                 R'000         R'000        R'000
Revenue                                                                        184 580       182 667      410 733
Cost of sales                                                                (108 763)     (111 800)    (230 586)
Gross profit                                                                    75 817        70 867      180 147
Other income                                                                       672         1 997        1 249
Other expenses                                                                (56 220)      (55 072)    (116 245)
Operating profit                                                                20 269        17 792       65 151
Investment revenue                                                              22 325         7 326       33 015
Finance cost                                                                   (1 343)       (1 199)      (3 323)
Profit before tax                                                               41 251        23 919       94 843
Tax                                                                           (12 401)       (5 793)     (26 743)
Profit for the year                                                             28 850        18 126       68 100
Other comprehensive income                                                           -             -            -
Total comprehensive income                                                      28 850        18 126       68 100
Basic and diluted earnings per share                  
(cents)                                                                          11.10         12.68        33.77
Headline and diluted headline earnings                                  
per share (cents)                                                                11.10         12.70        34.59
Weighted average number of shares used                                  
in the calculation of earnings per                                             260 000       143 000      201 660
share (OOOs)

Condensed Group Statement of Financial Position
                                                                        Unaudited        Unaudited        Audited
                                                                            Group            Group          Group
                                                                 28 February 2018 28 February 2017 31 August 2017
                                                                         6 months         6 months      12 months
                                                                            R'000            R'000          R'000
Assets                          
Non-current assets                          
Property, plant and equipment                                              173 969         126 136        130 107
Goodwill                                                                    18 165          18 165         18 165
Intangible assets                                                               66              65             62
Loans to group companies                                                    97 821          73 345         81 758
Deferred tax                                                                    12              52             65
                                                                           290 033         217 763        230 157
Current assets                          
Inventory                                                                   48 861          39 127         43 083
Other financial assets                                                      10 665           7 392          1 707
Current tax receivable                                                         154             154            154
Trade and other receivables                                                104 825          59 762         89 620
Construction deposits                                                        8 951               -              -
Biological assets                                                           55 872          48 359         54 323
Cash and cash equivalents                                                  425 442          30 872        541 919
                                                                           654 770         185 666        730 806
                          
Total assets                                                               944 803         403 429        960 963
                          
Equity and liabilities                          
Equity                          
Share capital                                                              507 517               -        507 517
Reserves                                                                     8 014           8 014          8 014
Retained income                                                            245 416         205 592        255 566
Total equity                                                               760 947         213 606        771 097
                          
Non-current liabilities                          
Other financial liabilities                                                  6 564          10 162          7 651
Operating lease liability                                                      788           1 653          1 243
Post-employment medical costs                                                1 111           1 007          1 075
Deferred tax                                                                78 599          74 468         72 341
                                                                            87 062          87 290         82 310
Current liabilities                            
Other financial liabilities                                                  3 178           3 245          3 419
Current tax payable                                                         23 201           7 217         21 752
Trade and other payables                                                    42 151          56 915         55 455
Provisions                                                                   4 492           8 953          8 944
Bank overdraft                                                              23 772          26 203         17 986
                                                                            96 794         102 533        107 556
                            
Total liabilities                                                          183 856         189 823        189 866
Total equity and liabilities                                               944 803         403 429        960 963
Net asset value per share (cents)                                           292.67          149.38         296.58
Number of shares in                                  
issue                                                                  260 000 000     143 000 000    260 000 000

Condensed Statement of Changes in Shareholder's Equity
                                                                        Unaudited        Unaudited         Audited
                                                                            Group            Group           Group
                                                                 28 February 2018 28 February 2017  31 August 2017
                                                                         6 months         6 months       12 months
                                                                            R'000            R'000           R'000
Opening balance                                                           771 097          225 480         225 480
Net proceeds from share issue                                                   -                -         507 517
Profit for the period                                                      28 850           18 126          68 100
Dividends paid                                                           (39 000)         (30 000)        (30 000)
Closing balance                                                           760 947          213 606         771 097

On 2 March 2017, an additional 117 000 000 ordinary shares were issued to
the public in a private placement as part of a capital raising exercise and
the listing of the Company on the main board of the Johannesburg Stock
Exchange ("JSE"). The Company successfully raised R526.5 million on listing.

Reconciliation of number of shares issued
                                                                    Unaudited          Unaudited         Unaudited
                                                                        Group              Group             Group
                                                             28 February 2018   28 February 2017    31 August 2017
Opening balance                                                   260 000 000                100               100
Share split                                                                 -        142 999 900       142 999 900
Issue of shares                                                             -                  -       117 000 000
Closing balance                                                   260 000 000        143 000 000       260 000 000

Premier was listed on the main board of the JSE on 2 March 2017. In
preparation for the listing, on 1 February 2017, there was a subdivision of
the authorised and issued shares of Premier in which one share was
subdivided into 1 430 000 shares. The issued share capital of Premier
increased from 100 ordinary shares to 143 000 000 shares on that date. 
On 2 March 2017, an additional 117 000 000 ordinary shares were issued to
invited investors in a private placement as part of a capital raising
exercise and the listing of the Company on the main board of the JSE.

Condensed Group Statement of Cash Flows
                                                                         Unaudited         Unaudited        Audited
                                                                             Group             Group          Group
                                                                  28 February 2018  28 February 2017 31 August 2017
                                                                          6 months          6 months      12 months
                                                                             R'000             R'000          R'000
Cash (used in)/generated from operations                                  (21 731)            21 043         40 094
Interest income                                                             15 537               825         17 446
Finance cost                                                               (1 343)           (1 199)        (3 323)
Tax paid                                                                   (4 644)           (4 105)       (12 659)
Net cash flows from operating activities                                  (12 181)            16 564         41 558
                   
Cash flows from investing activities                
Purchases of property, plant and equipment                
to sustain operations                                                     (26 488)           (8 495)       (14 066)
Purchases of property, plant and equipment                                
to expand operation                                                       (25 026)                 -        (7 995)
Purchases of intangible assets                                                 (7)              (27)           (27)
Loans advanced to group companies                                         (20 794)          (18 446)       (21 485)
Loans repaid by group companies                                             11 520                 -              -
Repayment of loans from group companies                                          -           (1 478)        (1 478)
Net movement in other financial assets                                     (8 959)           (5 152)          (641)
Net cash flows to investing activities                                    (69 754)          (33 598)       (45 692)
                            
Cash flows from financing activities                            
Proceeds on share issue                                                          -                 -        526 500
Share issue costs                                                                -                 -       (18 983)
Repayment of other financial liabilities                                   (1 328)           (1 813)        (2 966)
Dividends paid                                                            (39 000)                 -              -
Net cash flows to financial activities                                    (40 328)           (1 813)        504 551
                                  
Total cash movement for the year                                         (122 263)          (18 847)        500 417
Cash at the beginning of the year                                          523 933            23 516         23 516
Total cash at the end of the year                                          401 670             4 669        523 933

                             Segment Revenue                     Segment Profit before tax
                    Unaudited         Unaudited           Audited        Unaudited        Unaudited         Audited
             28 February 2018  28 February 2017    31 August 2017 28 February 2018 28 February 2017  31 August 2017
                     6 months          6 months        12  months         6 months         6 months       12 months 
                        R'000             R'000             R'000            R'000            R'000           R'000
Lobster                89 170            85 997           190 589           18 173           17 891          52 106
Pelagics               20 101            27 808            80 778            4 212            6 012          23 636
Hake                   15 644            15 143            31 210            5 046            5 036          12 013
Squid                  30 627            18 048            34 428            8 338            4 602          10 916
Abalone                15 337            18 765            36 186            4 615            6 136          13 241
Horse mackerel            569                 -                 -              569                -               -
Cold storage            5 378             4 552             9 555              387              371             332
Seagro                  2 885             1 667             5 174              712              397           1 013
Processing and              
                        6 963            12 778            26 909            1 045            2 215           6 996
marketing             
                      186 674           184 758           414 829           43 097           42 660         120 253
Less: inter            
                      (2 094)           (2 091)           (4 096)                
segmental sales            
Administration             
and support                 -                 -                 -         (24 378)         (25 058)        (61 255)
services              
Fair value gains            -                 -                 -            1 550              190           6 153
Interest income             -                 -                 -           22 325            7 326          33 015
Finance costs               -                 -                 -          (1 343)          (1 199)         (3 323)
Total                 184 580           182 667           410 733           41 251           23 919          94 843

The inter-segmental sales are in respect of cold storage charges to the
lobster segment.

Segment profit represents the profit before tax earned by each segment
without the allocation of central administration costs, fair value
adjustments, interest income and finance costs. This is the measure that is
reported to the chief operating decision-maker for the purposes of
assessing the segment performance and resource allocation. The accounting
policies of the reportable segments are the same as the Group's accounting policies.

Segment assets
                                                                      Unaudited          Unaudited         Audited
                                                               28 February 2018   28 February 2017  31 August 2017
                                                                       6 months           6 months       12 months
                                                                          R'000              R'000           R'000
Lobster                                                                  85 245             72 902          75 140
Pelagics                                                                100 478             79 158          94 743
Hake                                                                      5 214              8 224          15 935
Squid                                                                    26 140             17 103          10 701
Abalone                                                                 115 508             72 303          84 216
Cold storage                                                                619              1 074             628
Seagro                                                                    2 954              2 579           6 181
Processing and marketing                                                 35 648             29 593          35 358
Administration and support                                                                      
services                                                                572 985            120 441         637 996
Total segment assets                                                    944 791            403 377         960 898
Unallocated                                                                  12                 52              65
Consolidated total assets                                               944 803            403 429         960 963
                            
Segment liabilities                             
                                                                      Unaudited           Unaudited        Audited
                                                               28 February 2018    28 February 2017 31 August 2017
                                                                       6 months            6 months      12 months
                                                                          R'000               R'000          R'000
Lobster                                                                  15 340              11 698         12 820
Pelagics                                                                  8 852               9 280         11 258
Hake                                                                      3 698               5 257          4 757
Squid                                                                     8 635               6 547          7 124
Abalone                                                                   1 950               2 782          6 478
Processing and marketing                                                  6 677              15 820         14 158
Administration and support                                   
services                                                                 60 105              63 971         60 929
Total segment liabilities                                               105 257             115 355        117 525
Unallocated                                                              78 599              74 468         72 341
Consolidated total liabilities                                          183 856             189 823        189 866

For the purposes of monitoring segment performances and resource
allocations between segments all assets and liabilities are allocated to
reportable segments other than deferred tax assets and liabilities.

Included in the segmental results are:

                                 Depreciation and                  Additions to property, plant
                                   amortisation                            and equipment
                        Unaudited        Unaudited        Audited         Unaudited        Unaudited        Audited
                 28 February 2018 28 February 2017 31 August 2017  28 February 2018 28 February 2017 31 August 2017
                         6 months         6 months      12 months          6 months         6 months      12 months
                            R'000            R'000          R'000             R'000            R'000          R'000
Lobster                     2 684            2 781          5 669            12 772            2 783          3 238
Pelagics                    3 739            3 100          6 307            12 414            4 606         10 505
Squid                         390              280            623               785              735          1 270
Abalone                       565              536          1 148            25 890              271          6 671
Cold storage                   40               40             46                 -                -              -
Seagro                        108                -            237                 -                -              -
Processing and                                
marketing                       -              1                1                 -                -              -   
Administration                        
and support                   127              131            230                49              100            377
services                        
Total                       7 653            6 869         14 261            51 514            8 495         22 061

Revenue per region
                                                                Unaudited          Unaudited               Audited
                                                         28 February 2018   28 February 2017        31 August 2017
                                                                 6 months           6 months             12 months
                                                                    R'000              R'000                 R'000
United States of America                                           63 277             64 576               118 801
Far East                                                           41 546             45 508               110 029
Europe                                                             43 230             31 509                60 232
South Africa                                                       36 527             41 074               121 671
Total                                                             184 580            182 667               410 733

Determination of headline earnings
                                                                   Unaudited         Unaudited             Audited
                                                            28 February 2018  28 February 2017      31 August 2017
                                                                    6 months          6 months           12 months
                                                                       R'000             R'000               R'000
Earnings attributable to ordinary equity                 
holders of parent entity                                              28 850            18 126              68 100
Adjusted for:                               
- Effect of loss on disposal of property,                               
plant and equipment                                                        -                56               2 295
- Taxation effect                                                          -              (16)               (643)
Headline earnings                                                     28 850            18 166              69 752
Weighted average number of shares on which                               
earnings and headline earnings per share                         260 000 000       143 000 000          201 660 00
is based                               
Headline earnings per share (cents)                                    11.10             12.70               34.59

Earnings per share was calculated after taking into account the share split
which occurred on 1 February 2017 and the share issue which occurred on 
2 March 2017. The number of shares in issue compared to the prior year's
comparative period only includes the share split as the issue of shares
occurred after the reporting period. As a result thereof, headline earnings
of 11.10 cents per share is lower than that of the comparative period of
12.70 cents even though the profit after tax is higher than that of the
comparative period. 

Group Profile

Premier operates a vertically integrated fishing business which specialises
in the harvesting, processing and marketing of fish and fish-related
products. The Group is one of the largest black-owned and managed fishing
business in South Africa and one of the most transformed in terms of its
management and employees. The Group holds medium to long-term fishing
rights in west coast rock lobster, south coast rock lobster, small
pelagics, hake deep-sea trawl, hake longline, horse mackerel, swordfish and
tuna and squid. The Group also owns an abalone farm and invests in organic
fertilisers through the "Seagro" range of products.

Group Financial Performance Overview

The Group delivered an operating profit of R20 million for the six months
ended 28 February 2018, an increase of 14% compared to the prior period
operating profit of R18 million. The increase in operating profit is
attributable to the strong performance of the squid and lobster division.

The Rand strengthened against the US dollar from an average of 13,86 in the
prior comparative period, to an average of 12,69 in the current period
under review. The strengthening of the Rand impacted revenue . However, this
was offset by increased sales volumes in the squid and lobster division as
well as increased market prices for all the divisions resulting in revenue
increasing by 1% to R185 million from R183 million in the prior period.

The Group experienced improved catch rates in the squid and lobster
divisions as compared to the prior period which resulted in a reduction in
catch cost. This had a positive effect on the gross margin, increasing to
R76 million from R71 million in the prior period.

Interest income of R15 million was generated from the cash raised on
listing. The results of the prior comparative period do not include the
effects of the listing. The cash raised will be utilised to fund acquisitions
and growth initiatives.

The Group's profit after tax increased by 59% to R29 million from 
R18 million in the prior period mainly as a result of the strong operating
performance of the squid and lobster divisions as well as the interest
income generated from the cash raised on listing.

The weighted average number of shares ("WANOS") used in the calculation of
earnings per share ("EPS") and headline earnings per share ("HEPS") is 260
million for the current period which takes into account the 117 million new
shares issued on listing date. The WANOS used in the calculation of EPS and
HEPS for the prior comparative period is 143 million as the listing
occurred after the reporting period. Group headline earnings increased by
59% to R29 million from R18 million. HEPS decreased to 11.10 cents per
share from 12.70 cents per share and EPS decreased to 11.10 cents per share
from 12.68 cents per share even though the profit after tax increased by
59% due to the increase in the number of issued shares.

Cash generated from operations before working capital changes increased by 8% 
to R26 million from R24 million in the prior period due to the strong operational 
performance in the current period. There were significant catches during the month 
of February 2018 which resulted in an increase in the net working capital investment 
of R48 million as compared to R3 million in the prior period. This resulted in an 
outflow of R22 million of cash generated from operations compared to the cash generated 
from operations of R21 million in the prior period.

Acquisition of business

On 30 November 2017, the Group announced the acquisition of a 50.31% stake
in Talhado Fishing Enterprises (Pty) Ltd ("Talhado") for a consideration of
R85 million, subject to the fulfilment of certain conditions precedent. The
conditions precedent have now been fulfilled and the transaction
implemented. The Group acquired Talhado for its squid fishing rights, brand
and processing facilities. This will enhance the Group's footprint in the
squid sector. Talhado is the largest squid company in South Africa.

The conditions precedent, which consisted mainly of the approval of the
Competition Authorities in terms of the Competition Act No 89 of 1998 and
the approval by the Ministry of Agriculture, Forestry and Fisheries or his
delegated authority in terms of section 21 of the Marine Living Resources
Act 18 of 1998. These approvals were obtained on the 9th May and 11th May
2018, respectively. As the conditions precedent were met after the interim
period, the results of Talhado were not consolidated into Premier's current
reporting period.

Talhado's revenue for the first 3-month period 1 September 2017 to 30
November 2017 was R47 million and its net profit was R17 million.

Talhado's revenue for the 3-month period 1 December 2017 to 28 February
2018 was R51 million and its net profit for the period was R29 million.

Pro Forma financial information

The effective date of the Talhado acquisition transaction is 30 November
2017. However, in terms of IFRS 3, Business Combinations, the results of
Talhado can only be consolidated from the date when all conditions
precedent were met. As a result, the interim financial statements do not
include the results of Talhado for the 3 months from 1 December 2017 to 28
February 2018.

Pro forma results have been prepared for illustrative purposes only, in
order to provide information about the impact of the Talhado acquisition on
revenue, operating profit, profit before tax and profit after tax for the 
6-month period ended 28 February 2018, in order to show the growth in Premier
in relation to the acquisition of Talhado. Because of its nature, the pro forma 
financial information may not fairly present Premier's financial position, changes 
in equity, results of operations and cash flows.

The pro forma financial effects are presented in accordance with the JSE
Listings Requirements, the Guide on Pro Forma Financial Information issued
by SAICA and the measurement and recognition requirements of IFRS.

The accounting policies applied in quantifying pro forma adjustments are
consistent with Premier's accounting policies at 28 February 2018.

The pro forma results are the responsibility of the board and were not
reviewed or reported on by Premier's auditors.

Pro forma 6-month results for the 6 month period ended 28 February 2018
          
                                         Pro forma             Unaudited
                                    6 months ended        6 months ended
                                  28 February 2018      28 February 2017     Growth
                                                Rm                    Rm          %
Revenue                                    234 649               182 667      28.5%
Operating profit                            60 130                17 792     238.0%
Profit before tax                           80 734                23 919     237.5%
Profit after tax                            58 087                18 126     220.5%

Pro forma for the period ended 28 February 2018
                                                                            Premier
                                                           Talhado        pro forma
                                     Premier                                  after
                                                                       Inclusion of
                          Unaudited for the      Unaudited for the  Talhado for the
                             6 months ended         3 months ended   6 months ended
                                28 February            28 February      28 February
                                    2018(1)                2018(2)          2018(3)
Revenue                             184 580                 50 069          234 649
Operating profit                     20 269                 39 861           60 130
Profit before tax                    41 251                 39 483           80 734
Profit after tax                     28 850                 29 237           58 087

1   The column titled 'Premier unaudited for the 6 months ended 28 February 2018'
    represents the unaudited results for Premier for the 6 months ended 
    28 February 2018.
2   The column titled 'Talhado unaudited for the 3 months ended 28 February 2018'
    was extracted, without adjustment, from the management accounts of Talhado for
    the 3 months ended 28 February 2018. Premier is satisfied with the quality of
    the management accounts.
3   The column titled 'Premier pro forma after inclusion of Talhado for the 6 months
    ended 28 February 2018' represents the Premier pro forma results if Talhado had
    been consolidated as from 1 December 2017 to 28 February 2018.

All pro forma adjustments will have a continuing effect of the financial
results of Premier.

Review of operations

Lobster

The 2018 total allowable catch ("TAC") for South Coast Rock Lobster
("SCRL") is 335 tons up by 1% from the prior year TAC of 331 tons. The
quota which is available to Premier is 135 tons (2017: 133 tons).

The 2018 TAC for West Coast Rock Lobster ("WCRL") remained unchanged from
the prior year at 1 924 tons. However, the offshore allocation decreased
from 1 204 tons to 995 tons. The quota which is available to Premier is 
64 tons (2017: 87 tons). The total WCRL contracted quota acquired for 2018 is
101 tons (2017: 96 tons). The WCRL's contribution to revenue and profits of
the Group is less than 15%.

The Group experienced increased landings due to good catch rates for the
lobster division as well as a favourable size mix for SCRL. The favourable
size mix resulted in the Group achieving an increase of 3% in US dollar
pricing for SCRL as compared to the prior period. The increased landings
also resulted in increased sales volumes for the division as compared to
the prior period. The good catch rates, increased market prices and volumes
resulted in the division maintaining its margins despite the strengthening
of the Rand against the Dollar in the current period.

Small Pelagics

The Group's 2018 quota allocation for pilchards is 4 396 tons (2017: 3 383
tons). The catch rates for pilchards have improved slightly compared to the
prior period and if the trend continues, the Group expects improved
performance for this division in the current financial year. Industrial
fish catch rates were the same as those experienced in the prior year. The
Group had less fishing days for the current period as compared to the prior
period which resulted in lower volumes landed and lower revenues and profit
for the division in the current period. However, the Group expects the
landings at year end to improve, which will contribute positively to the
divisional performance by year end.

Squid

The fishing rights and the number of fishing vessels utilised for Squid
remained unchanged in the current period. The squid industry experienced
exceptional catch rates in the current period. The landed and sales volumes
for the division were more than double those of the prior period. The
market for South African squid remained stable despite the significant
increase in landed volumes and the Euro sales prices achieved by the Group
were the same as that of the prior period. The exceptional catch rates and
increased sales volumes resulted in improved margins and in an increase of
81% in operating profits for this division.

Hake

The 2018 TAC for hake is 133 119 tons. The quota which is available to
Premier is 700 tons. The Group's hake quota is caught, processed and
marketed through a joint operation with Blue Continent Products (Pty) Ltd.
The catch rates for this division are similar to those of the prior period
and the division also experienced a favourable size mix for its catches.
There was a marginal improvement in the market prices for hake which
resulted in the division maintaining its margins despite the strengthening
of the Rand in the current period.

Abalone

The Group commenced with the expansion construction of its abalone farm. 
30 tons of additional animal rearing capacity has been added to date and
construction is anticipated to be completed by the end of Quarter 1 in
2019. The division remains focused on increasing its spat ("Baby Abalone")
production and stock holding in preparation for the farm's expansion. Sales
volumes for the period were less than that of the prior period as the Group
continues to grow out the animals to a bigger size for the market. Sales
volumes are expected to increase once construction at the farm has been
completed.

Horse Mackerel

The Group was awarded a horse mackerel quota of 800 tons during the Fishing
Rights Application Process 2015/2016. The Group's horse mackerel quota is
caught, processed and marketed by Dessert Diamond Fishing (Pty) Ltd. 30% of
the quota was caught during the current period and the Group anticipates
the full quota to be caught by year end.

Seagro

Seagro is an organic fertiliser produced from fish oil which is a by-
product of the fishmeal making process. There was an increased availability
of fish oil in the current period which resulted in production of seagro
and increased sales volumes as compared to the prior period. The increased
sales volumes in the current period resulted in increased profitability
compared to the prior period.

Processing and marketing

The total WCRL contracted quota acquired for 2018 is 101 tons (2017: 96
tons). The total wild abalone contracted quota acquired for 2018 is 31 tons
(2017: 30 tons). Landed volumes for the current period were lower than
those of the prior year due to the reduced number of fishing days. The
lower landed volumes resulted in lower sales volumes and revenue and
profits for the current period. Landed volumes increased significantly
after the reporting period and the Group anticipates the full quotas to be
caught by year end.

Subsequent events

During May 2018, the acquisition of Talhado Fishing Enterprises (Pty) Ltd was completed. 
The Group acquired a 50.31% stake in Talhado Fishing Enterprises (Pty) Ltd ("Talhado") 
for a consideration of R85 million. The conditions precedent were only met after the 
end of the interim reporting period. Refer above to the note "acquisition of business" 
for more information.

Future Prospects

The Group continues to focus on the expansion of its abalone farm,
additional acquisitions and increasing the diversification of its product
basket. Talhado generated a significant increase in revenue and profit due
to the exceptional catch rates being experienced in the squid industry. The
Group expects Talhado to contribute significantly to the operational
performance of the Group. The Group also expects to realise synergies with
Talhado once the acquisition is finalised.

Dividends

No interim dividend have been declared for the six months ended 28 February 2018.

Reporting entity

Premier is a Company domiciled in South Africa. These condensed unaudited
consolidated interim financial statements ("interim financial statements")
as at and for the six months ended 28 February 2018, comprises of Premier
the Company, its subsidiaries and interests in joint ventures operations.

Basis of preparation

The unaudited condensed consolidated interim financial statements have been
prepared and presented in accordance with International Accounting Standard
34 ("IAS34"), the Listings Requirements of the JSE Limited ("JSE") ("the
Listings Requirements"), the SAICA Financial Reporting Guides as issued by
the Accounting Practices Committee and the Financial Reporting
Pronouncements as issued by the Financial Reporting Standards Council and
the requirements of the Companies Act of South Africa (No. 71 of 2008), as
amended, applicable to summarised financial statements.

The accounting policies applied in the preparation of the interim financial
statements, which are based on reasonable judgement and estimates, are in
accordance with International Financial Reporting Standards ("IFRS") and
are consistent with those applied in the audited annual financial
statements for the year ended 31 August 2017. The condensed consolidated
interim financial statement have been prepared by Brent Robertson CA(SA),
Head of Finance under the supervision of Isaiah Tatenda Bundo CA(SA), the
Financial Director and were not reviewed or audited by the Group's external
auditors, BDO Cape Inc.

These interim financial statements were authorised for issue by the
Company's Board of Directors on 17 May 2018.

Use of judgements and estimates

In preparing these interim financial statements, management made judgments,
estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets and liabilities, income and
expenses. Actual results may differ from these estimates.

The significant judgements made by management in applying the Group's
accounting policies and the key sources of estimation uncertainty were the
same as those that were applied to the audited consolidated financial
statements for the year ended 31 August 2017.

Measurement of fair values

The Group has an established control framework with respect to the
measurement of fair values. The fair-valuation calculations are performed
by the Group's finance department and operational team on an annual basis.
The finance department reports to the Group's Financial Director. The
valuation reports are approved by the investment committee in accordance
with the Group's reporting policies.

Appreciation

We wish to thank our employees, Group executives, management, our Board of
directors, as well as our strategic partners, stakeholders and business
partners for their loyalty and dedication in contributing to the success of
the Group.

Reverend Dr Vukile Mehana                  Mr Mogamat Samir Saban
Independent Non-executive chairman         Chief executive officer

Cape Town
17 May 2018

Directors
***Reverend Dr Vukile Mehana (Independent Non-executive chairman); **Khalid
Abdulla (Deputy chairman); Mogamat Samir Saban (Chief executive officer);
Isaiah Tatenda Bundo; Rushaan Isaacs; ***Salim Young; ***Rosemary Phindile
Mosia; **Aziza Begum Amod; **Cherie Felicity Hendricks; ***Clifford Leonard
van der Venter;*** Advocate Ngoako Ramatlhodi (appointed on 7 March 2018),
***Sebenzile Patrick Mngconkola (appointed on 7 March 2018)

*** Independent Non-executive
** Non-executive

Company secretary: Nobulungisa Mbaliseli

Registered address: Quay 7, East Pier, Victoria & Alfred Waterfront, 
Cape Town 8001

Email: nobulungisa@aeei.co.za

Transfer secretaries: Link Market Services South Africa (Pty) Ltd,
Rennie House, 13th Floor, 19 Ameshoff Street, Braamfontein, 2001

Auditors: BDO Cape Incorporated

Sponsor: PSG Capital

Date: 17/05/2018 02:10:00 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.

Share This Story