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Financial results for the year ended 29 February 2020 – Short form announcement
NUTRITIONAL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2004/002282/06)
JSE Share code: NUT ISIN: ZAE000156485
("Nutritional Holdings" or the “Company”)
FINANCIAL RESULTS FOR THE YEAR ENDED 29 FEBRUARY 2020 –
SHORT-FORM ANNOUNCEMENT
FINANCIAL HIGHLIGHTS
Percentage
- 2020 2019
Growth
• EARNINGS PER 0.05 (0.06) 183%
SHARE (cents)
• HEADLINE
EARNINGS PER 0.05 (0.06) 183%
SHARE (cents)
• NET ASSET
VALUE PER 2.19 1.31 67%
SHARE (cents)
• TURNOVER R41 729 R37 876 10%
(R’000)
• PROFIT/LOSS R7 473 (R5 402) 238%
(R’000)
Nutritional Holdings is pleased to report its results for the year ended 29 February 2020
(“Current Reporting Period”) and shareholders are accordingly advised that the Company
is excited to report its final results as follows:
• earnings per share (“EPS”) of 0,05 cents per share compared to earnings of -0,06
cents per share for the previous corresponding period; and
• headline earnings per share (“HEPS”) of 0,05 cents per share compared to
headline earnings of -0,06 cents per share for the previous corresponding period.
The increases in EPS and HEPS for the Current Reporting Period compared to the
previous corresponding period are due mainly to movements in, inter alia, the following
items:
1. The welcomed and impressively pleasing profit is as a result of efficient
execution of a strategic plan by the CEO of Nutritional Holdings to sign an
interim management agreement for Nutritional Holdings to manage Ukusekela
Holdings for the sole profit and loss of the duration of the management
agreement. The proposed acquisition which the led to the signing of a the
interim management agreement has borne fruit and bodes well for future
quarter on quarter growth and expected positive cash flows. The global trend
for Cannabis sector companies has achieved triple digit growth and this
achievement further illustrates that the company is on track to mirror its global
counterparts in delivering impressive profits in both the short and medium term.
The largest factor in achieving the profit must be attributed to exponential
demand and resultant growth in the sale of Cannabis associated products
interalia; “The Ultimate Immune Booster with Cannabis Extract.” This aligns
with Nutritional Holdings CEO’s vision in the proposed acquisition of
Ukusekela. NUTs roll-out plan globally is to tie up with major pharmaceutical
companies in Europe and Africa to distribute its CBD products. A detailed
announcement will follow in the near term. Interruptions as a result of the
pandemic which caused production in many industries to come in marginally
lower than previous years, has in fact acted as a catalyst to proving
sustainability of the Cannabis arm of Nutritional Holdings which through the
vision of the CEO has been largely instrumental in offsetting the debt of
Nutritional Holdings and presenting a welcoming profit to all shareholders for
the first time in several years.
2. Ukusekela Holdings is a leader in research and development of the Cannabis
and Herbal market and is strategically placed to take advantage of the recent
unprecedented spike in demand and awareness for its immune boosting
supplement and other cannabis infused products.
Interruptions as a result of the pandemic which caused production in many industries to
come in marginally lower than previous years, has in fact acted as a catalyst to proving
sustainability of the Cannabis arm of Nutritional Holdings which through the vision of the
CEO has been largely instrumental in offsetting the debt of Nutritional Holdings Limited
and presenting a welcoming profit to all shareholders for the first time in several years.
Following our previously announced restructuring actions, we have substantially reduced
our expense and cash burn. Our marketing and R&D investments are being re-allocated
to programs with high-return potential in order to drive sales.
We have already proven we can deliver 3 digit gross margin and are confident that we
can surpass that level as we work toward higher capacity and economies of scale across
our facilities as demand for our cannabis products continue to grow. In the meantime, we
are focused on further optimizing our operating footprint through a full end-to-end strategy
that looks at people, process, technology, and infrastructure that we believe will lead to
best in class sustainable margins over time.
With the relaxation of the lockdown, Nutritional Holdings intends on implementing the
following key strategic “Action Plan” as follows:
1. Global Kiosks in all regional markets across Africa with an internet driven backend
support e-commerce and nationwide delivery of products.
2. Nutritional Foods to now supply Instant Meals to the Gulf Region through existing
relationships held with the current Nutritional Holdings CEO via a contract
exceeding R250 000 000,00 per annum.
3. Nutritional Holdings has secured sales avenues nationally for the Ultimate Immune
Booster and has forecasted sales of R83 000 000,00 over the next 6 months.
4. Nutritional Holdings has developed a formula for medical cannabis edibles through
Nutritional Foods factory that will infuse cannabis extract with Instant meals for use
by Cancer / terminally ill patients. Nutritional Holdings has been in ongoing
discussions with the Oncology Fraternity since March 2020 and will be rolling out
sample product within the month of September 2020. Approximate market value is
in the region of R500 000 000.00 per annum in Africa and R2 500 000 000.00
globally.
The CEO is currently reviewing its dividend policy to create shareholder and stakeholder
value.
The industrial, medical and recreational potential of the cannabis plant is touted as being
worth between $150bn and $250bn. South Africa could be a world leader in this emerging
industry, and Nutritional Holdings under its new regime aims to be the market leader.
As per the State of the Nation Address:
One particular point raised in the President’s address focused on the future of cannabis
in South Africa with Ramaphosa said, "This year we will open up and regulate the
commercial use of hemp products, providing opportunities for small-scale farmers; and
formulate policy on the use of cannabis products for medicinal purposes, to build this
industry in line with global trends. The regulatory steps will soon be announced by the
relevant ministers".
This in essence enables Nutritional Holdings to broaden its product offering local and with
its massive head start with facility and marketing will ensure it obtains and maintains
market leadership.
COVID-19
Whilst many industries were forced into temporary lockdown – The cannabis industry as
a result of its medicinal benefits boomed as consumers utilised our Ultimate Immune
Booster with cannabis extract as an aid in boosting their immunity. Nutritional Holdings
staff showed unreserved support for the hygiene, social distancing and team and shift de-
densification measures implemented. The Group’s infection rate has been low.
To assist in bringing urgent relief to people most impacted by the COVID-19 pandemic,
Nutritional Holding’s staff and CEO contributed free bottles to the underprivileged of the
Ultimate Immune Booster as well as certain PPE Items which had been personally
funded.
Management continues to manage the COVID-19 pandemic risk with no relaxation of any
of its initial containment measures and protocols and through ongoing communication
with and motivation of staff.
SHORT-FORM STATEMENT
This short-form announcement is the responsibility of the directors. It is only a summary
of the information contained in the full announcement and does not contain full or
complete details.
Any investment decision should be based on the full announcement accessible from 31
August 2020, via the JSE link and also available on the Company’s website at
www.nutritionalholdingssa.com
Copies of the full announcement may also be requested by contacting Mr MT Azum by
email at mohammad@gulfdelevopment.ae and are available for inspection at the
Company’s registered office at no charge, weekdays during office hours.
The JSE link is as follows:
https://senspdf.jse.co.za/documents/2020/jse/isse/nut/FY2020.pdf.
HLB Certified Master Auditors (South Africa) Inc have reviewed this announcement and
their unmodified review report is available for inspection at the Company's registered
office and is available on the Company’s website on at www.nutritionalholdingssa.com
31 August 2020
Durban
Designated adviser
Exchange Sponsors
Date: 01-09-2020 07:19:00
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