CHOPPIES ENTERPRISES LIMITED - Abridged unaudited group financial results for the six months ended 31 December 2019

Abridged unaudited group financial results for the six months ended 31 December 2019

CHOPPIES ENTERPRISES LIMITED
Registration number 2004/1681
ISIN:BW0000001072
JSE SHARE CODE: CHP
BSE SHARE CODE: CHOPPIES
Tax Reference Number: C08710401018
“Choppies” or the “Company” or “the Group”

ABRIDGED UNAUDITED GROUP FINANCIAL RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2019

The Board of Choppies Enterprises Limited announces the results of the Group for the six months ended 31 December 2019.

Financial highlights
- These results were published late due to changes in auditors as well as the legal and forensic
  investigations on some of the matters raised by the auditors which reports were only concluded and
  released during September 2019. These events, coupled with the outbreak of COVID 19 and the
  lockdowns in the countries in which the Group operates, resulted in the delay in publication.
- The accounting policies applied during the period are consistent with those applied in the previous year
  except for the introduction of IFRS 16 Leases which has been applied retrospectively. The disclosure of
  the Group’s results are affected by the decision of the Board to discontinue or dispose of its operations
  in South Africa, Kenya, Tanzania, and Mozambique. Accordingly, the results of these operations are
  disclosed in terms of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations.
- The Group recorded a negative equity mainly due to unrealized foreign currency translation reserves
  and trading losses from regions that were discontinued since the June 2019 year-end. The negative
  Group equity gave rise to extensive investigations into the ability of the Company and Group being able
  to operate as going concerns for the next year and medium term thereafter. The Board does not expect
  any material uncertainty over its ability to continue as a going concern in the foreseeable future.
- Group revenue from the continued operations reduced by 17% to P 2 969 million (2018: P 3 596
  million). This reduction was a direct result of a further weakening of the Zimbabwe currency against the
  Pula. Gross profit margins improved slightly to 22.9% (2018: 22.5%) following another good
  performance in the Botswana operations.
- Profit for the period decreased to P66 million (2018 P77 million) due to the continual weakening of the
  Zimbabwe currency.
- The Company has a policy of declaring dividends once a year based on the annual results.

  Key financial data -
  continuing businesses only                              2019                  2018               Change
  (unaudited)
                                                 Pula Millions         Pula Millions


  Revenue                                                2,969                 3,596                (17%)
  Gross profit                                             680                   810                (16%)
  Gross margin                                           22.9%                 22.5%               40 bps
  Operating profit                                         145                   115                  25%
  Operating margin                                        4.9%                  3.2%              166 bps
  Profit for the period                                     66                    77                (15%)
  Earnings per share basis                           5.2 Thebe             5.8 Thebe                (10%)
  Headline earnings per share basic                  5.5 Thebe             7.3 Thebe                (25%)
  Net cash flows generated from
  operating activities                                     244                   266                 (23)
  Cash and cash equivalents at end of
  the period                                             (115)                   152                (267)
  
This short form announcement is the responsibility of the Board of Directors of Choppies Enterprises
Limited and is a summary of the information in the full announcement available on the Stock Exchange
News Service (“SENS”) at https://senspdf.jse.co.za/documents/2020/JSE/ISSE/CHP/CHPDEC19.pdf and
on the Group’s website: https://choppiesgroup.com/investor-relations/.

This announcement does not contain full details and should not be used as a basis for any investment
decision in relation to the Company’s shares. The full announcement is also available for inspection, at no
charge, at the Company’s registered office (Plot 50371, Fairgrounds office park, Gaborone, Botswana.) and
the office of the Sponsor during standard office hours.

Sponsors:
Stockbrokers Botswana Ltd
Plot 67978, Ground Floor, East Wing, Mokolwane House, Fairgrounds, Gaborone, Botswana Telephone:
+267 395 7900

Rand Merchant Bank (A division of First Rand Bank Limited)
1 Merchant Place, Corner of Fredman Drive and Rivonia Road, Sandton, 2196
Telephone: (011) 282 8231

24 JULY 2020

The Company’s primary listing is on BSEL and its secondary listing is on JSE. The listings
in both exchanges are currently suspended.

Date: 24-07-2020 12:30:00
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.