TIGER BRANDS LIMITED - Unaudited group results and dividend declaration for the six months ended 31 March 2018

Release Date: 24/05/2018 07:05
Code(s): TBS
 
Wrap Text
Unaudited group results and dividend declaration for the six months ended 31 March 2018

TIGER BRANDS LIMITED
Registration number: 1944/017881/06
Incorporated in the Republic of South Africa 
Share code: TBS ISIN: ZAE000071080

Unaudited group results and dividend declaration 
for the six months ended 31 March 2018

Salient features*
Tiger Brands has a slow start to the year under difficult trading conditions

- Revenue declined 4% to R15,7 billion
- Operating income* declined 8% to R2,0 billion
- Gross profit margin expands by 80bps to 33,3%
- Core domestic food businesses deliver a steady performance
- Rehabilitation work continues at Value Added Meat Products (VAMP) facilities
- VAMP recall and related costs amount to R365 million net of initial insurance claims
- HEPS down 16% to 868 cents
- Interim dividend unchanged at 378cps

* From continuing operations/Operating income before asset impairments, abnormal items and IFRS 2 charges 


Commentary
Overview
With the exception of VAMP, the group's core domestic food businesses delivered a steady performance in the 
six-month period ended 31 March 2018, notwithstanding intense competition and ongoing pressure on pricing as 
consumers continually search for value. The group's overall performance was negatively affected by the Home 
and Personal Care division, as well as Deciduous Fruit (LAF) and VAMP. 

Group revenue from continuing operations declined by 4% to R15,7 billion, while operating income* decreased by 
8% to R2,0 billion. Revenue was negatively impacted by price deflation of 2,7% and an overall volume decline 
of 1,6%. 

The consolidated gross profit margin percentage of 33,3% improved by 80 basis points (bps) compared with the
corresponding period last year, benefiting from a stronger Rand and lower raw material costs. However, lower 
volumes across the majority of businesses had a negative effect on operating leverage. Despite lower revenue, 
marketing investment increased by 7% to R502 million in line with strategy to invest in and support our core 
brands, which further impacted profitability. 

Total revenue from domestic operations decreased by 3% to R13,8 billion. Overall, volumes in the domestic 
business were in line with the previous year. Operating income declined by 4% to R2,0 billion, with the 
total operating margin remaining unchanged at 14,2%.  

Revenue in Exports and International declined by 11% to R1,9 billion, while operating income decreased by 
56% to R85 million, driven primarily by LAF.    

Costs associated with the VAMP product recall, amounting to R365 million (net of insurance claims submitted to date),
have been included in abnormal items. These costs exclude ongoing trading losses and are calculated on the basis that
VAMP's facilities are reopened by 30 September 2018. Note 4 on page 16 makes reference to the residual value of stock
amounting to R183 million where future utilisation is dependent on ongoing test results and the reopening of the 
facilities.

Net financing costs of R45 million (2017: R118 million), reflect a reduction of R74 million compared to the same
period last year. This was primarily due to lower average debt levels compared to last year. 

Income from associates increased by 43% to R341 million, with all associates contributing to the improved performance.
Oceana benefited from a once-off R161 million deferred tax adjustment in Daybrook Fisheries following the reduction in
the Federal corporate tax rate in the United States from 35% to 21%, effective after 31 December 2017. A blended tax
rate of 25% was accordingly applied in calculating the deferred tax adjustments in this period. Tiger Brands' equity
accounted share of this benefit amounts to R79 million with a 5% impact on headline earnings per share. 

Profit before tax from continuing operations decreased by 18% to R1,9 billion. Excluding the VAMP recall costs of 
R365 million, profit before tax from continuing operations decreased by 2% to R2,3 billion. 

Haco Tiger Brands (E.A) Limited (Haco), which was reflected as an asset held-for-sale at 30 September 2017, was
disposed of with effect from 14 December 2017. Its results for the current period to the date of disposal are 
included in the consolidated income statement as discontinued operations.

Earnings per share from continuing operations decreased by 18% to 852 cents (2017: 1 036 cents), while headline
earnings per share from continuing operations was down 16% to 868 cents (2017: 1 036 cents). Earnings per share 
from total operations declined by 17% to 859 cents (2017: 1 036 cents) and headline earnings per share from total 
operations decreased by 16% to 870 cents.

* From continuing operations/Operating income before asset impairments, abnormal items and IFRS 2 charges 

Operating performance
Grains 
The revenue decline of 5% in the Grains division reflects the significant price deflation of 6% as overall volume 
grew by 2%. Operating income increased by 3% to R1,0 billion. 

Milling and Baking's revenue declined by 8%, driven by price deflation in maize. Operating income improved by 4% to
R826 million, with improved performances from maize and sorghum. Notwithstanding intense competitor activity in the
wheat-to-bread value chain, this segment delivered a steady performance. 

Other Grains grew revenue by 4% to R2,1 billion, underpinned by a 10% volume increase, driven primarily by rice.
Operating income decreased by 3% to R220 million, with procurement benefits in rice being invested behind the brand 
to recover market share.

Consumer Brands - Food
Consumer Brands - Food was negatively impacted by the cessation of activities at the company's VAMP operations in
March 2018, as well as a disappointing performance in Groceries. However, this was offset by strong performances 
from the Snacks & Treats and Beverages businesses. Total revenue was unchanged at R6,0 billion, reflecting flat 
volumes and pricing for the period, while operating income grew by 5%. 

The management of margins and volumes proved difficult in the Groceries business, following intense competition 
in core product segments. Revenue increased 2% to R2,7 billion, in line with volume growth of 2%. Operating income 
declined by 15% to R264 million, principally due to increased levels of promotional spend and an unfavourable 
product mix. 

Revenue in Snacks & Treats was unchanged at R1,1 billion. This was due to the containment of selling prices in order
to remain competitive on shelf. Operating income, however, increased by 20% to R194 million as a result of improved
factory efficiencies and aggressive cost control. 

The Beverages business increased volumes and revenue by 13%, with operating income growth of 95% reflecting the
positive volume leverage and sound management of costs.  

VAMP's performance was impacted by the closure of its facilities in early March 2018. As a consequence, revenue
declined by 9% to R1,0 billion and operating income fell by 78% to R13 million.  

An update on Listeria is provided separately in this SENS announcement. 

Home, Personal Care and Baby (HPCB)
HPCB's revenue declined by 14% to R1,2 billion and operating income decreased by 43% to R196 million. 

Revenue in the Personal Care category increased by 2% to R296 million, following strong volume growth of 8%. 
This was offset by significant investment in promotional activity and an adverse product mix. As a consequence, 
operating income declined by 61% to R26 million. 

In Baby Care, pouch volume growth of 15% was offset by a decline in the cereals and jarred baby food segments, as
consumers down-traded in favour of more affordable options. Revenue decreased by 10% to R390 million, while operating 
income fell by 33%. The trading performance was negatively affected by an unfavourable product mix in the baby food 
segment.

Revenue in the Home Care category declined by 23% to R534 million. This was due to a decrease in volumes of 22% as a
result of a poor pest season. The impact of this volume decline is reflected in lower operating income of R108 million. 

Exports and International 
Total revenue for the Exports and International businesses was down 11% to R1,9 billion compared with the
corresponding period last year. Operating income declined by 56%, driven by LAF. 

Notwithstanding the ongoing foreign currency shortages in the group's export markets, which resulted in tighter 
credit terms and the slower replenishment of stock by distributors, the Export business delivered a satisfactory 
result with revenue increasing by 2% to R898 million and operating income being in line with the previous year. 

The International operations' performance was mixed. A strong performance from Chococam was offset by the impact 
of the ongoing challenges at Deli Foods.  

LAF's revenue decreased by 23% to R639 million, mainly due to volume declines driven by muted demand for its products
and competitive pricing pressure. Fruit quality and availability in the current period have been affected by the
prolonged drought in the Western Cape. This resulted in significant factory under-recoveries. The combination of 
these factors led to an operating loss of R72 million compared with an operating profit of R30 million in the 
corresponding period last year.  

Cash flow and capital expenditure
Cash generated from operations decreased to R1,5 billion (2017: R3,1 billion). This was primarily due to a net
increase in working capital of R0,9 billion (2017: net decrease of R0,5 billion). The strategic procurement of 
certain raw materials contributed to higher stock holdings, while customer payments were impacted by the half 
year closing on the Easter long weekend. Capital expenditure incurred during the period amounted to R297 million 
(2017: R383 million). 

Interim dividend 
The company has declared an unchanged interim dividend of 378 cents per share for the six-month period ended 
31 March 2018. Shareholders are referred to the accompanying dividend announcement for further details.

Outlook
The outlook for the balance of the year remains challenging, with intense competitor activity in the domestic market
and no meaningful recovery expected in international markets. 

The VAMP facilities are likely to remain closed for a large part of the second half as we complete remedial work on
our facilities and await guidance from the Department of Health. Shareholders are referred to the SENS announcement 
issued on 19 April 2018 on the financial impact of the suspension of operations. 

Change in directorate
Mr Clive Vaux retired as executive director of the company, with effect from the conclusion of its annual general
meeting held on 20 February 2018.

Listeria update
Shareholders are referred to the SENS announcements issued by the company on 5, 9, 19, 29 March 2018 and on 
25 April 2018. 

Looking ahead, the company is considering a number of initiatives aimed at rebuilding trust with consumers. 
The initiatives will focus on facilitating a national solution to a national crisis and ensuring sustainable 
food safety into the future. 
Some of the initiatives include:
- A multi-stakeholder forum to ensure a sustainable and inclusive response to the current challenges;  
- Leveraging our corporate social investment programme to support initiatives aimed at improved food hygiene 
  and awareness; and
- Partnering with relevant stakeholders to drive world-class food safety research.

The company is carefully considering the best approach to ensure that the recently launched class actions are 
handled sensitively and responsibly having regard to all the facts. The application for certification of the 
Classes is in progress, while our legal representatives are in discussion to explore further collaboration. 
Given that these discussions are in progress, we will communicate our approach as soon as a decision has 
been reached. 

Tiger Brands has at all times had measures in place to ensure compliance with the prevailing standards and best
practices and it remains committed to food safety and placing consumers' health and safety above all else. 
Considerable effort and time are being expended to ensure that these objectives are met across the portfolio, 
including an assessment of current processes and practices as they relate to production, quality assurance 
and reporting lines.

The detection of the presence of Listeria ST6 in our factory in Polokwane was disappointing to us given our 
compliance with best practices and prevailing standards. We are engaging openly and transparently with relevant 
government departments, regulators and all other stakeholders. As one of South Africa's leading food manufacturers, 
with a long and proud heritage in the country, it is our duty to rebuild trust through our actions and deal with 
this crisis honestly and with integrity. Tiger Brands remains resolute in addressing the social and reputational 
consequences of the Listeriosis outbreak.

The board and management are deeply saddened that people have fallen ill and that some have lost their lives as
a result of Listeriosis. Our heartfelt condolences are extended to those who suffered the loss of a loved one. 

By order of the board

KDK Mokhele            LC Mac Dougall
Chairman               Chief executive officer

Bryanston
23 May 2018

Date of release: 24 May 2018

Declaration of interim dividend
The board has approved and declared an interim dividend of 378 cents per ordinary share (gross) in respect of the 
six months ended 31 March 2018.

The dividend will be subject to the dividends tax that was introduced with effect from 1 April 2012.

In accordance with paragraphs 11.17 (a)(i) to (x) and 11.17 (c) of the JSE Listings Requirements the following
additional information is disclosed:
- The dividend has been declared out of income reserves;
- The local dividends tax rate is 20% (twenty per centum) effective 22 February 2017;
- The gross local dividend amount is 378 cents per ordinary share for shareholders exempt from the 
  dividends tax;
- The net local dividend amount is 302,40 cents per ordinary share for shareholders liable to pay the 
  dividends tax;
- Tiger Brands has 189 818 926 ordinary shares in issue (which includes 10 326 758 treasury shares); and
- Tiger Brands Limited's income tax reference number is 9325/110/71/7.

Shareholders are advised of the following dates in respect of the interim dividend:

Last day to trade cum the interim dividend                                       Tuesday, 26 June 2018    
Shares commence trading ex the interim dividend                                Wednesday, 27 June 2018    
Record date to determine those shareholders entitled to the interim dividend      Friday, 29 June 2018    
Payment in respect of the interim dividend                                         Monday, 2 July 2018    

Share certificates may not be dematerialised or rematerialised between Wednesday, 27 June 2018 and 
Friday, 29 June 2018, both days inclusive.

By order of the board

JK Monaisa
Company secretary

Bryanston
24 May 2018


Interim condensed consolidated income statement
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                 Notes             2018             2017               2017    
Continuing operations                                                                                                   
Revenue                                                                 15 685,2         16 394,4           31 297,9    
Cost of sales                                                          (10 467,9)       (11 067,3)         (20 856,4)    
Gross profit                                                             5 217,3          5 327,1           10 441,5    
Sales and distribution expenses                                         (1 905,3)        (1 840,1)          (3 596,4)    
Marketing expenses                                                        (502,1)          (471,1)            (771,4)    
Other operating expenses                                                  (811,8)          (846,6)          (1 549,7)    
Operating income before impairments and abnormal items        2          1 998,1          2 169,3            4 524,0    
Impairments                                                   3            (29,7)               -             (559,9)    
Abnormal items                                                4           (362,9)            22,6              (23,4)    
Operating income after impairments and abnormal items                    1 605,5          2 191,9            3 940,7    
Net finance costs and investment income                       7            (44,6)          (118,3)            (206,6)    
Income from associated companies                                           341,2            238,5              533,3    
Profit before taxation                                                   1 902,1          2 312,1            4 267,4    
Taxation                                                                  (492,1)          (613,8)          (1 234,4)    
Profit for the period from continuing operations                         1 410,0          1 698,3            3 033,0    
Discontinued operations                                                                                                 
Profit for the period from discontinued operations            6             14,2             (1,1)             105,0    
Profit for the period                                                    1 424,2          1 697,2            3 138,0    
Attributable to:                                                                                                        
Owners of the parent                                                     1 406,5          1 686,6            3 119,3    
- Continuing operations                                                  1 395,6          1 686,4            3 011,0    
- Discontinued operations                                                   10,9              0,2              108,3    
Non-controlling interests                                                   17,7             10,6               18,7    
- Continuing operations                                                     14,4             11,9               22,0    
- Discontinued operations                                                    3,3             (1,3)              (3,3)    
                                                                         1 424,2          1 697,2            3 138,0    
Basic earnings per ordinary share (cents)                                  858,5          1 035,9            1 914,9    
- Continuing operations                                                    851,8          1 035,8            1 848,4    
- Discontinued operations                                                    6,7              0,1               66,5    
Diluted basic earnings per ordinary share (cents)                          853,3          1 012,8            1 877,3    
- Continuing operations                                                    846,7          1 012,7            1 812,1    
- Discontinued operations                                                    6,6              0,1               65,2    
Headline earnings per ordinary share (cents)                               870,4          1 035,6            2 161,0    
- Continuing operations                                                    868,3          1 035,7            2 154,7    
- Discontinued operations                                                    2,1             (0,1)               6,3    
Diluted headline earnings per ordinary share (cents)                       865,3          1 012,6            2 118,4    
- Continuing operations                                                    863,2          1 012,7            2 112,3    
- Discontinued operations                                                    2,1             (0,1)               6,1    


Interim condensed consolidated statement of comprehensive income
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                                   2018             2017               2017    
Profit for the period                                                    1 424,2          1 697,2            3 138,0    
Other comprehensive loss, net of tax                                      (717,3)          (213,6)            (104,9)    
Net (loss)/gain on hedge of net investment in foreign operation^           (15,3)             4,6                3,8    
Foreign currency translation adjustments^                                  (45,2)           (57,0)            (122,7)    
Share of associates' other comprehensive loss and FCTR related   
to translation of investments in associates                               (680,3)          (177,9)             (86,2)    
Net (loss)/gain on cash flow hedges^                                        (7,3)            (4,7)              25,0    
Net gain on available-for-sale financial assets^                            32,4             20,2               13,0    
Remeasurement raised in terms of IAS 19R                                       -                -               81,4    
Tax effect                                                                  (1,6)             1,2              (19,2)    
Total comprehensive income for the period, net of tax                      706,9          1 483,6            3 033,1    
Attributable to:                                                                                                         
Owners of the parent                                                       696,1          1 494,6            3 025,2    
Non-controlling interests                                                   10,8            (11,0)               7,9    
                                                                           706,9          1 483,6            3 033,1    
^ Items that may be subsequently reclassified to profit or loss. During the current period, R13,2 million of the 
  foreign currency translation reserve, relating to Haco, was reclassified to profit or loss, as well as 
  R3,1 million (31 March 2017: R0,9 million) on the available-for-sale financial asset derecognised in terms 
  of the Black Managers Trust Participation Rights Scheme and was reclassified to profit or loss.


Interim condensed consolidated segmental information                    
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                                   2018             2017               2017    
Revenue                                                                                                                 
 Domestic operations                                                    13 793,1         14 270,9           27 109,0    
  Grains                                                                 6 594,2          6 909,1           13 309,4    
   Milling and baking1                                                   4 472,7          4 877,9            9 519,7    
   Other Grains2                                                         2 121,5          2 031,2            3 789,7    
  Consumer Brands - Food                                                 5 978,4          5 940,3           11 148,0    
   Groceries                                                             2 749,3          2 695,4            5 008,4    
   Snacks & Treats                                                       1 129,0          1 134,6            2 157,2    
   Beverages                                                               786,5            698,1            1 203,6    
   Value Added Meat Products                                             1 037,0          1 141,6            2 243,1    
   Out of Home                                                             276,6            270,6              535,7    
  Home, Personal Care and Baby (HPCB)                                    1 220,5          1 421,5            2 651,6    
   Personal Care                                                           296,3            291,6              682,5    
   Baby Care                                                               390,1            434,1              888,0    
   Home Care                                                               534,1            695,8            1 081,1    
                                                                                                                           
 Exports and International                                               1 892,1          2 123,5            4 188,9    
  Exports                                                                  897,5            876,6            1 747,3    
  International operations                                                                                                
  - Central Africa (Chococam)                                              440,7            395,6              821,3    
  - West Africa (Deli Foods)                                                56,5            184,8              280,3    
  Deciduous Fruit (LAF)                                                    639,2            829,0            1 620,1    
  Other intergroup sales                                                  (141,8)          (162,5)            (280,1)    
Continuing operations                                                   15 685,2         16 394,4           31 297,9    
Discontinued operations - East Africa                                       42,9            387,1              561,2    
Total revenue                                                           15 728,1         16 781,5           31 859,1    
                                                                                                                        
Operating income before impairments and abnormal items3                                                                 
 Domestic operations                                                     1 956,3          2 029,7            4 235,5    
  Grains                                                                 1 046,6          1 020,2            2 361,2    
   Milling and baking1                                                     826,2            792,4            1 858,9    
   Other Grains2                                                           220,4            227,8              502,3    
  Consumer Brands - Food                                                   714,7            681,5            1 280,2    
   Groceries                                                               263,6            309,7              588,6    
   Snacks & Treats                                                         194,4            161,6              323,5    
   Beverages                                                               182,0             93,3              144,0    
   Value Added Meat Products                                                13,4             60,8              104,2    
   Out of Home                                                              61,3             56,1              119,9    
  Home, Personal Care and Baby (HPCB)                                      196,4            341,3              622,6    
   Personal Care                                                            25,6             65,9              138,6    
   Baby Care                                                                63,2             94,3              207,7    
   Home Care                                                               107,6            181,1              276,3    
  Other4                                                                    (1,4)           (13,3)             (28,5)    
  Exports and International                                                 85,1            193,6              398,8    
  Exports                                                                  111,7            112,6              272,9    
  International operations                                                                                                
  - Central Africa (Chococam)                                               75,7             65,6              147,2    
  - West Africa (Deli Foods)                                               (30,6)           (14,8)             (34,5)    
  Deciduous Fruit (LAF)                                                    (71,7)            30,2               13,2    
Total operating income before IFRS 2 charges                             2 041,4          2 223,3            4 634,3    
IFRS 2 charges                                                             (43,3)           (54,0)            (110,3)    
Total operating income after IFRS 2 charges                              1 998,1          2 169,3            4 524,0    
Discontinued operations - East Africa                                       11,0             (0,2)              14,0    
Total operating income                                                   2 009,1          2 169,1            4 538,0    
1 Comprises maize milling, wheat milling and baking, sorghum beverages and malt-based breakfast cereals.
2 Comprises rice, pasta and oat-based breakfast cereals.
3 Operating income is stated after amortisation of intangible assets.
4 Includes the corporate office and management expenses relating to international investments.
  All segments operate on an arm's length basis in relation to inter-segment pricing.


Interim condensed consolidated statement of financial position 
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                                   2018             2017               2017    
ASSETS                                                                                                                  
Non-current assets                                                      12 570,1         13 050,6           12 949,5    
Property, plant and equipment                                            4 551,4          4 351,8            4 588,4    
Goodwill                                                                 1 761,2          2 070,7            1 774,2    
Intangible assets                                                        1 803,9          1 831,9            1 822,8    
Investments                                                              4 414,4          4 773,5            4 720,1    
Deferred taxation asset                                                     39,2             22,7               44,0    
Current assets                                                          11 029,6         10 698,3           10 665,0    
Inventories                                                              4 920,9          5 117,8            4 812,0    
Trade and other receivables                                              4 999,9          4 473,7            4 631,6    
Cash and cash equivalents                                                1 108,8          1 106,8            1 221,4    
Assets classified as held-for-sale                                             -            837,2              364,7    
Total assets                                                            23 599,7         24 586,1           23 979,2    
EQUITY AND LIABILITIES                                                                                                  
Total equity                                                            16 469,2         16 295,8           17 061,2    
Issued capital and reserves                                             16 312,7         15 849,0           16 803,8    
Non-controlling interests                                                  156,5            446,8              257,4    
Non-current liabilities                                                    990,7          1 999,5              968,8    
Deferred taxation liability                                                355,3            275,3              347,7    
Provision for post-retirement medical aid                                  633,4            676,1              619,1    
Long-term borrowings                                                         2,0          1 048,1                2,0    
Current liabilities                                                      6 139,8          6 146,8            5 776,1    
Trade and other payables                                                 4 314,2          4 296,5            4 278,2    
Provisions                                                                 547,5            555,3              614,9    
Taxation                                                                     6,7             93,3               94,4    
Short-term borrowings                                                    1 271,4          1 201,7              788,6    
Liabilities directly associated with assets      
classified as held-for-sale                                                    -            144,0              173,1    
Total equity and liabilities                                            23 599,7         24 586,1           23 979,2    
Net debt/(cash)                                                            164,6          1 143,0             (430,8)    


Interim condensed consolidated statement of cash flows 
                                                                                         Reclass*           Reclass*    
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                                   2018             2017               2017    
Cash operating profit                                                    2 366,2          2 631,3            5 388,1    
Working capital changes                                                   (894,4)           475,4              745,4    
Cash generated from operations                                           1 471,8          3 106,7            6 133,5    
Finance income and income from investments                                  81,0            111,5               34,8    
Finance costs                                                             (119,8)          (222,2)            (203,4)    
Dividends received from associate companies                                    -            203,9              350,2    
Taxation paid                                                             (555,6)          (583,0)          (1 195,9)    
Cash available from operations                                             877,4          2 616,9            5 119,2    
Dividends paid                                                          (1 193,7)        (1 182,1)          (1 834,1)    
Net cash (outflow)/inflow from operating activities                       (316,3)         1 434,8            3 285,1    
Purchase of property, plant and equipment                                 (296,9)          (383,0)            (919,0)    
Net cash on disposal of subsidiary                                         103,5                -               23,8    
Proceeds from disposal of property, plant,                   
equipment and intangible assets                                              7,4              0,3               92,2    
Net cash outflow from investing activities                                (186,0)          (382,7)            (803,0)    
Net cash (outflow)/inflow before financing activities                     (502,3)         1 052,1            2 482,1    
Repurchase of Tiger Brands shares                                           (6,5)               -                  -    
Black Managers Trust (BMT) shares exercised                                 15,0             19,5               24,0    
Shares exercised relating to equity-settled scheme                         (41,6)           (74,4)             (77,8)   
Reduction in non-controlling interest in empowerment shares                    -            (22,4)             (22,4)    
Long-term borrowings raised/(repaid)                                           -              1,8           (1 056,2)    
Short-term borrowings raised/(repaid)                                        8,4                -               (7,2)    
Net cash outflow from financing activities                                 (24,7)           (75,5)          (1 139,6)   
Net (decrease)/increase in cash and cash equivalents                      (527,0)           976,6            1 342,5    
Effect of exchange rate changes on cash and cash equivalents               (60,4)           (21,3)              18,8    
Cash and cash equivalents at the beginning of the period                   486,3           (875,0)            (875,0)    
Cash and cash equivalents at the end of the period                        (101,1)            80,3              486,3    
Cash resources                                                           1 108,8          1 206,2            1 221,4    
Short-term borrowings regarded as cash and cash equivalents             (1 209,9)        (1 125,9)            (735,1)    
                                                                          (101,1)            80,3              486,3    
* For the 2018 interim reporting, the group has reviewed the JSE Report on the Proactive Monitoring of Financial
  Statements issued in February 2018. As a consequence of this review the group has restated its cash flow treatment 
  relating to equity settled share option schemes as financing activities. The presentation of comparative figures has therefore 
  been adjusted to conform to the presentation of the current period. The cash flow related to equity-settled share schemes 
  (March 2017: R74,4 million and September 2017: R77,8 million) has been reclassified out of operating activities and 
  proceeds from BMT shares exercised (March 2017: R19,5 million and September 2017: R24,0 million) has been reclassified 
  from investing activities.

Interim condensed consolidated statement of changes in equity            
                                                                             Shares held
                                                                           by subsidiary                        Total                     
                                                       Non-                          and   Share-based   attributable          Non-               
                              Share capital   distributable   Accumulated    empowerment       payment   to owners of   controlling      Total    
R'million                       and premium        reserves       profits       entities       reserve     the parent     interests     equity   
Balance at 1 October 2016             148,5         3 046,1      14 373,4       (2 508,9)        488,5       15 547,6         486,3   16 033,9    
Profit for the period                     -               -       1 686,6              -             -        1 686,6          10,6    1 697,2    
Other comprehensive loss                  -          (192,0)            -              -             -         (192,0)        (21,6)    (213,6)    
Total comprehensive (loss)    
/income                                   -          (192,0)      1 686,6              -             -        1 494,6         (11,0)   1 483,6    
Transfers between reserves3               -            34,6         (85,1)             -          50,5              -             -          -    
Share-based payment2                      -               -             -              -         (31,7)         (31,7)            -      (31,7)    
Dividends on ordinary shares                                                                                                         
(net of dividend on           
treasury shares)                          -               -      (1 176,1)             -             -       (1 176,1)            -   (1 176,1)    
Reduction in non-controlling                                                                                                 
interest in empowerment 
shares                                    -               -             -              -             -              -         (22,4)     (22,4)    
Sale of empowerment shares1               -               -             -           14,6             -           14,6          (6,1)       8,5    
Balance at 31 March 2017              148,5         2 888,7      14 798,8       (2 494,3)        507,3       15 849,0         446,8   16 295,8    
Profit for the period                     -               -       1 432,7              -             -        1 432,7           8,1    1 440,8    
Other comprehensive income                -            39,2          58,7              -             -           97,9          10,8      108,7    
Total comprehensive income                -            39,2       1 491,4              -             -        1 530,6          18,9    1 549,5    
Disposal of subsidiary                    -               -             -              -             -              -        (188,9)    (188,9)    
Transfers between reserves3               -           112,1        (113,2)             -           1,1              -             -          -    
Share-based payment2                      -               -             -              -          51,6           51,6             -       51,6    
Dividends on ordinary shares                                                                                                         
(net of dividend on treasury  
shares)                                   -               -        (632,5)             -             -         (632,5)        (16,6)    (649,1)    
Sale of empowerment shares1               -               -             -            5,1             -            5,1          (2,8)       2,3    
Balance at 30 September 2017          148,5         3 040,0      15 544,5       (2 489,2)        560,0       16 803,8         257,4   17 061,2    
Profit for the period                     -               -       1 406,5              -             -        1 406,5          17,7    1 424,2    
Other comprehensive loss                  -          (710,4)            -              -             -         (710,4)         (6,9)    (717,3)   
Total comprehensive           
(loss)/income                             -          (710,4)      1 406,5              -             -          696,1          10,8      706,9    
Disposal of subsidiary                    -           (13,2)            -              -             -          (13,2)        (94,5)    (107,7)    
Transfers between reserves3               -           341,2        (352,7)             -          11,5              -             -          -    
Share-based payment2                      -               -             -              -          (3,8)          (3,8)            -       (3,8)    
Dividends on ordinary shares                                                                                                         
(net of dividend on           
treasury shares)                          -               -      (1 189,9)             -             -       (1 189,9)         (3,8)  (1 193,7)    
Sale of empowerment shares1               -               -             -           26,2             -           26,2         (13,4)      12,8    
Repurchase of Tiger Brands    
Shares4                                (6,5)              -             -              -             -           (6,5)            -       (6,5)    
Balance at 31 March 2018              142,0         2 657,6      15 408,4       (2 463,0)        567,7       16 312,7         156,5   16 469,2    
1 Relates to the exercising of options vested post the December 2014 lock-in period in terms of the Black Managers 
  Participation Right Scheme (BMT). In the current year, R12,8 million related to BMT II and R13,4 million to Brimstone SPV.
2 Included in the movement of the share-based payment are options exercised amounting to R41,6 million (2017: R74,4 million).
3 Transfer between reserves relate to the share of associates' earnings and the equity settled options exercised.
4 Tiger Brands Limited repurchased 2 250 942 of its own shares from Black Managers Trust 2 and Brimstone.


Other salient features 
                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
R'million                                                                   2018             2017               2017    
Capital commitments                                                      1 877,5            649,8            2 174,4    
- Contracted                                                               502,5             54,7              476,3    
- Approved                                                               1 375,0            595,1            1 698,1    
Capital commitments will be funded from                        
normal operating cash flows and the                            
utilisation of existing borrowing facilities.                  
Capital expenditure                                                        296,9            383,0              919,0    
- Replacement                                                              224,0            294,1              457,1    
- Expansion                                                                 72,9             88,9              461,9    
Contingent liabilities                                                                                                  
- Guarantees and contingent liabilities                                     27,7             12,7               11,5    


Notes

1. Basis of preparation and changes to the group's accounting policies
   The preparation of these results has been supervised by Noel Doyle, Chief Financial Officer of Tiger 
   Brands Limited.

   The condensed consolidated interim results for the six months ended 31 March 2018 have been prepared in 
   accordance with IAS 34: Interim Financial Reporting as issued by the IASB, the South African Companies 
   Act No 71 of 2008 and the Listings Requirements of the JSE Limited. These statements have not been 
   audited or reviewed.

   The accounting policies adopted in the preparation of the condensed consolidated interim results are 
   consistent with those applied in preparation of the group's annual consolidated financial statements 
   for the year ended 30 September 2017. Revenue is recorded in terms of IFRS 15. The majority of the 
   group's financial instruments measured at fair value in terms of IFRS 13, are noted as level 1 
   hierarchy, which are valued based on quoted market prices.

   Goodwill and indefinite useful life intangible assets are tested for impairment annually 
   (as at 30 September) and when circumstances arise that indicate the carrying value may be impaired. 
   The group's impairment tests for goodwill and intangible assets with indefinite useful lives are based 
   on the value-in-use calculations. The key assumptions used to determine the recoverable amount for the 
   different cash-generating units were disclosed in the annual consolidated financial statements for the 
   year ended 30 September 2017.

   There will be a reclassification of financial assets and the measurement of provisions against receivables 
   will be revised using the expected credit loss method, the impact of which is being quantified and an impact 
   assessment will be completed by 30 September 2018. The effective date will be 1 October 2018 and the 
   modified retrospective method will be used.

                                                                       Unaudited        Unaudited            Audited     
                                                                      six months       six months               year     
                                                                           ended            ended              ended     
                                                                        31 March         31 March       30 September     
   R'million                                                                2018             2017               2017    
2. Operating income before impairments and abnormal items                                                                
   Depreciation (included in cost of sales and other 
   operating expenses)                                                    (294,3)          (280,5)            (552,5)    
    Amortisation                                                            (5,5)            (6,1)             (11,4)    
    IFRS 2 (included in other operating expenses)                                                                        
   - Equity settled                                                        (37,9)           (42,7)             (97,7)    
   - Cash settled                                                           (5,4)           (11,3)             (12,6)    
                                                                     
3. Impairment
   During the current period, R19,3 million relating to Hercules     
   indefinite useful life intangible assets and R10,4 million        
   plant and equipment were impaired.                                
   Impairment of intangible assets                                         (19,3)               -             (309,9)    
   Impairment of property, plant and equipment                             (10,4)               -                  -    
   Impairment of associate investment                                          -                -             (250,0)    
                                                                           (29,7)               -             (559,9)   
4. Abnormal items                                                                                                         
   Net costs associated with VAMP product recall*                         (415,2)               -                  -    
   Initial insurance claim                                                  50,0             85,7               85,7    
   Profit on disposal of property                                            2,3                -               73,0    
   Proceeds from warranty claim settlement                                     -             28,4               28,4    
   Once-off consulting fees                                                    -            (91,5)            (132,0)    
   Restructuring provision                                                     -                -              (78,5)    
                                                                          (362,9)            22,6              (23,4)    
5. Reconciliation between profit for the period and headline earnings                                                   
   Continuing operations                                                                                                
   Profit for the year attributable to owners of the parent              1 395,6          1 686,4            3 011,0    
   Loss/(profit) on disposal of plant, equipment and vehicles                0,5                -              (52,5)    
   Impairment of intangible assets                                          19,3                -              309,9    
   Impairment of property, plant and equipment                               8,5                -                  -    
   Impairment of associate investment                                          -                -              250,0    
   Headline earnings adjustment - associates                                                                            
   - Profit on sale of non-current assets                                   (1,2)            (0,1)              (8,5)    
   Headline earnings for the period                                      1 422,7          1 686,3            3 509,9    
   Tax effect of headline earnings                                           2,3                -               15,5    
   Attributable to non-controlling interest                                    -                -                  -    
   Discontinued operations                                                                                              
   Profit for the year attributable to owners of the parent                 10,9              0,2              108,3    
   Profit on disposal of subsidiary                                         (7,5)               -              (98,1)    
   Profit on sale of property, plant and equipment                             -             (0,4)                 -    
   Headline earnings for the period                                          3,4              0,2               10,2    
   Tax effect of headline earnings                                             -              0,2                  -    
   Attributable to non-controlling interest                                    -             (0,3)                 -    
   * These costs exclude ongoing trading losses and are calculated on the assumption that the VAMP facilities are 
     likely to have reopened by 30 September 2018. The testing of the frozen pork raw materials stock is ongoing 
     and only expected to be concluded within the next three months. All frozen stock tested to date has proved 
     negative for Listeria monocytogenes. The remaining carrying value of frozen stock exposed to potential 
     future write-offs is R80 million. All other stock of product, raw materials, packaging and ingredients, 
     which is expected to be utilised following a recommencement of operations amounts to R103 million 
     at 31 March 2018.                                                         
                                                                       Unaudited        Unaudited            Audited    
                                                                      six months       six months               year    
                                                                           ended            ended              ended    
                                                                        31 March         31 March       30 September    
   R'million                                                                2018             2017               2017    
6. Analysis of profit/(loss) from discontinued operations
   Profit/(loss) for the period from discontinued operations 
   (attributable to owners of the company)                          
   Revenue                                                                  42,9            387,1              561,2    
   Expenses                                                                (31,9)          (387,3)            (547,2)    
   Operating income/(loss) before impairments and abnormal items            11,0             (0,2)              14,0    
   Impairments                                                                 -                -                  -    
   Abnormal items                                                            7,5             (1,2)              97,9    
   Operating income/(loss) after impairments and abnormal items             18,5             (1,4)             111,9    
   Finance costs                                                            (0,4)            (0,3)              (0,2)    
   Profit/(loss) before taxation                                            18,1             (1,7)             111,7    
   Taxation                                                                 (3,9)             0,6               (6,7)    
   Profit/(loss) for the period from discontinued operations                14,2             (1,1)             105,0    
   Attributable to non-controlling interest                                 (3,3)             1,3                3,3    
   Attributable to owners of parent                                         10,9              0,2              108,3    
   Cash flows from discontinued operations                                                                              
   Net cash inflows from operating activities                                7,7             68,3              138,6    
   Net cash (outflows)/inflows from investing activities                   (13,2)           (12,7)               1,4    
   Net cash inflows/(outflows) from financing activities                     5,8             (3,6)             (80,8)    
   Net cash inflows                                                          0,3             52,0               59,2    

7. Net finance costs and investment income                                                                              
   Net interest paid                                                       (29,2)          (110,4)            (179,7)    
   Net foreign exchange loss                                               (17,5)            (9,9)             (30,2)    
   Investment income                                                         2,1              2,0                3,3    
   Net financing costs                                                     (44,6)          (118,3)            (206,6)    

   8. Subsequent events
   With the exception of the Enterprise product recall and related Listeria update reflected above there are no 
   other material events that occurred during the period subsequent to 31 March 2018, but prior to these financial 
   results being authorised for issue.


Corporate information

Independent non-executive directors
KDK Mokhele (chairman), MO Ajukwu, MJ Bowman, M Makanjee, 
TE Mashilwane, RD Nisbet, MP Nyama, YGH Suleman, BS Tshabalala

Executive directors
LC Mac Dougall (chief executive officer) 
NP Doyle (chief financial officer) 

Company Secretary
JK Monaisa

Investor Relations
N Catrakilis-Wagner (011) 840 4841

Postal address
PO Box 78056, Sandton, 2146, South Africa
Telephone (011) 840 4000

Sponsor
JP Morgan Equities South Africa (Pty) Limited
1 Fricker Road, Corner Hurlingham Road, Illovo, 2196

Share registrars
Computershare Investor Services (Pty) Limited
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
PO Box 61051, Marshalltown 2107, South Africa
Telephone (011) 370 5000


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