ZAMBEEF | Press Release – Full Year Results 2016

Zambeef (AIM: ZAM), the fully integrated agri-business with operations in Zambia, Nigeria and Ghana, announce its final audited results for the year ended 30 September 2016.

Key Highlights

• 10.8 per cent. growth in cold chain volumes has delivered a strong financial performance leading to record profitability for the Group:
  • Profit After Tax of ZMW157.4 million (USD14.5 million), compared with a loss of ZMW54.6 million (USD7.7 million) for the same period last year;
  • EBITDA has increased by 111.1 per cent. in ZMW terms (38 per cent. in USD), from ZMW149.5 million to ZMW316.6 million (USD21.2 million to USD29.2 million );
  • Administrative costs as a percentage of turnover improved from 28.2 per cent. (2015) to 25.7 per cent. (2016), as a result of more effective cost management;

• Group debt reduced by 23.6 per cent. from USD72 million (2015) to USD55 million (2016);
• Gearing reduced significantly from 60.3 per cent. (2015) to 26 per cent. (2016);
• Debt-to-EBITDA ratio has improved from 4.2 (2015) to 1.7 (2016).

• Successful completion of the USD65 million CDC Group PLC equity investment into Zambeef.
• Cash settlement (USD23.4m) of RCL Foods Ltd put options in Zam Chick Ltd and Zamhatch Ltd, giving Zambeef full control of its poultry operations.
• Strong performance from the Cold Chain Food Products division, achieved through a market-driven strategy involving continued roll out of new macro outlets.
• During the year, Zambeef’s total retail network increased from 154 outlets to 171 outlets.
• Final settlement reached with the Zambia Revenue Authority (ZRA) over the historical and disputed Zamanita Ltd tax liability, resulting in a write-back to the profit and loss account of approximately ZMW34 million (USD3.1 million).

Commenting on the results, Zambeef Chairman Dr. Jacob Mwanza, said:

“Zambeef has ended the financial year in a strong position. A 10.8 per cent. volume growth in cold chain food products and a 15.3 per cent. volume growth in stock feed has delivered record profits through the efficient delivery of our strategic priorities, and a platform has been created from which to continue sustainable long term growth. The balance sheet has been significantly strengthened as a result of CDC having made a substantial investment in the Group.

Zambeef now has the ability once again to invest in growing its business, accelerate the roll-out of its new macro stores and expand its cold chain foods production capacity in order to meet the growing demand for its products, both in Zambia and in the surrounding SADC/COMESA regions.

Zambeef operates in a dynamic expanding market, where the demand for its products, both locally and in neighboring countries, is expected to grow rapidly in order to meet the needs of an increasing population.

We are entering into a new era for Zambeef, and I am confident that the Group is well positioned to take advantage of the opportunities that lie ahead.”

For further information, please contact:

Notes to Editors

The Zambeef Group is one of the largest integrated cold chain food producers in Zambia, involved in the production, processing, distribution and retailing of beef, chicken, pork, milk, eggs, dairy products, fish, flour and stock feed. The Group also has large cereal row cropping operations (principally maize, soya beans and wheat), with approximately 7,971 hectares of row crops under irrigation, which are planted twice a year and a further 8,623 hectares of rain-fed/dry-land crops available for planting each year. The Group is also expanding its West Africa operations in Nigeria and Ghana.

The Group employed an average of 6,000 employees in the period.

Further information can be found on www.zambeefplc.com

This publication is in line with standard practice for London Stock Exchange.

Download full reports

Download the 2016 full year results (UK)
Download the 2016 full year results presentation (UK)
Download the 2016 annual report