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Summary of consolidated financial results for the year ended 30 September 2020
Nampak Limited
(Registration number 1968/008070/06)
(Incorporated in the Republic of South Africa)
Share code: NPK ISIN: ZAE 000071676
('Nampak' or the 'group')
Summary of consolidated financial results for the year ended 30 September 2020
Key financial indicators for continuing operations
Revenue of R11.3bn decreased 23%
EBITDA for covenants R1.1bn down by 48%
Trading profit R682m down by 56%
Operating loss R283m 2019: R402m operating profit
Impairments R4.0bn primarily relating to Nigeria and Angola
Loss for the year R4.3bn
Headline loss 78cps for continuing operations 2019: 54cps earnings
Headline loss 88cps for total operations 2019: 19cps loss
Highlights
Operating capability sustained despite significant impact of the novel coronavirus (COVID-
19) pandemic
Cash of R1.1bn generated from operations
Net proceeds from disposals and bonds of R2.0bn, used to reduce US$ denominated debt
R2.4bn transferred from Angola and Nigeria
Successful renewal of key contracts and meaningful export contracts secured for Bevcan
Group funding covenants renegotiated and complied with, but with stringent conditions
Improvement in short-term liquidity
CEO's comment
'2020 proved to be a challenging year across all geographies for Nampak as the COVID-19
pandemic significantly reduced economic activity in the markets where we operate. While
performance in Nigeria was resilient, the lockdown in most markets impacted performance
across all divisions and limited the progress in our restructuring activities at Plastics SA and
DivFood divisions. Bevcan successfully defended its market share - renewing two
substantial supply contracts for the next three years - and secured large export contracts for
the coming financial period. In Angola, currency devaluations prevailed, and reduced
consumer purchasing power led to further volume declines. Despite all these challenges, we
made good progress in reducing US dollar-denominated debt, focused on optimising
working capital and pulled back on capital expenditure during this year. This ensured cash
generated from operations remained positive.' Erik Smuts, Nampak's CEO
Overview
This was one of the most challenging years for Nampak as the impact of COVID-19 took
effect in the second half of our financial year. Most of the countries we operate in went into
hard economic lockdown towards the end of March 2020 as governments grappled with
limiting the spread of the virus. In South Africa this included a ban on the production,
distribution and sale of alcohol products for effectively three months of the financial year.
This negatively impacted the sale of beverage cans, paper conical cartons, closures for the
wine and spirit markets, as well as other products deemed as non-essential during this
period.
It also had a secondary impact on associated products as consumer patterns changed due
to restrictions on social events. However, significant progress was made in reducing US
dollar debt, defending our market shares in key markets and developing new growth
opportunities. As part of the revised funding agreement with our lenders, the group has
committed to a further reduction of R1 billion of its net interest-bearing debt in FY21.
Our manufacturing sites continued to operate to the extent allowed by regulations and
Nampak implemented safety measures to mitigate the impact of COVID-19 as best as
possible. We experienced 291 COVID-19 infections across our facilities. Sadly, two
employees passed away as a result of the virus and we extend our sympathies and
condolences to their families.
Reduced economic activity across all geographies, coupled with an already weak economic
climate and pressure on consumers' disposable income in the first half of the financial year,
adversely impacted the group's performance and profitability, as indicated below:
Group financial performance for continuing operations
R million FY 2020 FY 2019 % change
Revenue 11 278 14 642 (23%)
Trading profit 682 1 558 (56%)
Operating (loss)/profit before Zimbabwe
devaluation (19) 1 439 (+100%)
Operating (loss)/profit after Zimbabwe
devaluation (283) 402 (+100%)
(Loss)/profit before net impairments (730) 154 (+100%)
Net impairments (4 020) (148) (+100%)
(Loss)/profit before taxation (4 750) 6 (+100%)
Loss for the year from continuing operations (4 349) (390) (+100%)
Profit/(loss) for the year from discontinued
operations 369 (1 124) (+100%)
Loss for the year from total operations (3 980) (1 514) (+100%)
Cash generated from operations(1) 1 087 1 141 (4%)
Cash flows from operations(1) 415 264 57%
Continuing operations:
(Loss)/earnings per share (cents) (595) 42 (+100%)
Headline (loss)/earnings per share (cents) (78) 54 (+100%)
Continuing and discontinued operations:
Loss per share (cents) (538) (132) (+100%)
Headline loss per share (cents) (88) (19) (+100%)
1 From total operations.
The group's independent auditor, Deloitte & Touche (Deloitte), conducted an audit of the
consolidated annual financial statements for the group for the year ended 30 September
2020. Deloitte, have issued an unmodified audit opinion in terms of the International
Standards on Auditing, with a paragraph on material uncertainty relating to going concern.
The covenant conditions highlight potential events which could result in default on the
group's funding agreements and this indicates that a material uncertainty exists that may
cast significant doubt on the group's ability to continue as a going concern. Notwithstanding
this material uncertainty, the directors have determined that the group is a going concern
based on the financial plans and forecasts, available funding facilities, actions taken by the
group, the historic track record of the group to deliver on disposals, cost reduction and
optimisation plans as well as the management of working capital and capital expenditure.
This short form announcement is the responsibility of the directors and is only a summary of
the information in the full announcement. The full long form announcement including the
audit opinion of the external auditor, Deloitte, on the summarised consolidated financial
statements and the basis for its unmodified opinion is available on the JSE website at
https://senspdf.jse.co.za/documents/2020/JSE/isse/NPK/FY2020.pdf
and on Nampak's website at
http://www.nampak.com/Investors/Financial-Information
under the 2020 financial year.
The annual financial statements including the auditor's report of the external
auditor, Deloitte & Touche, which sets out key audit matters and the basis
for its unmodified opinion is available at
http://www.nampak.com/Investors/Financial-Information
under the 2020 financial year.
Any investment decisions made by investors and/or shareholders should be
based on consideration of the full announcement as a whole. The short form
announcement has not been audited.
Copies of the full announcement and auditor's report may also be requested from the Group
Company Secretary, Ilse van Lochem on Ilse.vanLochem@nampak.com, alternatively
collected from the company's registered office, at no charge, during office hours.
Year end presentation webcast
Nampak management will hold a webcast on Tuesday, 1 December 2020 at 10h00
Central Africa Time (GMT+2) to present its annual results and address questions from the
investment community. Webcast details are available on Nampak's website:
www.nampak.com/Investors.
Bryanston
1 December 2020
Sponsor: UBS South Africa (Pty) Ltd
Registered office
Nampak House, Hampton Office Park, 20 Georgian Crescent East,
Bryanston, Sandton, 2191, South Africa
PO Box 69983, Sandton, 2021, South Africa
Date: 01-12-2020 11:51:00
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