Wrap Text
Interim results and dividend declaration
Marshall Monteagle PLC
(Incorporated in Jersey)
(Registration number: 102785)
(External registration number: 2010/024031/10)
JSE Code: MMP ISIN: JE00B5N88T08
(“the Company”” or “the Group”)
Interim results for the six months to 31 March 2018 and a dividend declaration
Dear Shareholder,
The Directors report the results for the six months to 31 March 2018 and a dividend declaration.
Results
- Group revenue increased by 21% to US$194,637,000 compared with the same period last year. In
constant currency terms revenue increased by 14% to US$184,417,000.
- Profit before tax increased by 27% to US$6,646,000, and in constant currency terms increased by 20% to
US$6,303,000.
- Headline earnings of US$5.9 cents per share were 2% higher when compared with US$5.8 cents per share
in the same period last year.
- Basic earnings per share of US$6.4 cents per share were 10% higher when compared with US$5.8 cents
per share in the same period last year.
- An interim dividend of US1.9 cents per share will be paid in July 2018 (2017 – US1.8 cents).
- Net assets per share are US$2.17 (2017 – US$1.92). Net assets per share have increased from the 30
September 2017 figure of US$2.04 per share, reflecting favourable exchange rate movements and
increases in operating profits.
The Group has investments in import and distribution businesses, investment properties and equities. The
investments in property and equities have performed well and all of the import and distribution businesses
showed improved overall performance. These are reported on separately below.
As Easter fell at the end of March, 2018 Easter peak trade, debtors and creditors also falls into the first half
Group results and capital requirements.
The high tax charge for the period reflects withholding tax on dividends from South African subsidiaries and
the write off of deferred tax assets which may not be recoverable.
Import and Distribution
Our import and distribution businesses in food and household consumer products continue to perform well in
a changing environment; we are constantly reviewing our supply-chain to ensure that we remain the most
cost-effective solution from factory to shelf. Currency and raw material markets have been extremely volatile
and we expect similar market conditions in the second half of the year. We are well positioned to navigate
these external factors beyond our control. This division continues to provide procurement, supply chain and
risk management services to multiple retailers, wholesalers and manufacturers in Southern and Central Africa,
South America, the Middle East and China. We remain committed to working with suppliers of quality raw
materials, skilled technologists and first world production facilities.
Our Metals and Minerals business continues to make extremely good progress and we are developing new
partnerships with miners in Southern Africa and end users on an international basis. During 2016-2017 we
witnessed a major global rebalancing of supply and demand covering most metals and minerals and during the
first six months of the current financial year the market has come back into balance. This division provides
fully integrated logistics, marketing, finance and shipping services to the Southern African mining industry and
is placing significant focus on chrome and manganese. We are committed to partnering with producers who
require a professional all-encompassing solution from collection ex mine through to delivery to end users on
an international basis.
Our state of the art coffee manufacturing plant has successfully implemented British Retail Consortium quality
and food safety certification. The volatile currency and coffee prices internationally continue to put pressure
on margins.
Our Tool & Machinery import and distribution business continues to show an improvement over last year and
is expected to end the year with a much improved profit. Consumer spending continues to decline, making it
very difficult to grow sales organically. However, value is being extracted by reducing debt through stronger
stock and debtor management
Property Portfolio
Rental income from our large multi-tenanted industrial property in San Diego was higher than the second half
of 2017 and the property is fully let. Although at present, the commercial and industrial property market in
Southern California remains highly competitive, we continue to seek to invest further in similar property in the
region.
The Group’s South African commercial and light industrial property portfolio has achieved a steady return in
adverse conditions. The Group is increasing its focus on operating efficiencies and raising rental income from
the existing estate.
Investment Portfolio
The value of our investments has remained substantially unchanged as generally increasing share prices have
been offset by adverse currency movements on stocks not quoted in US dollars.
Net Assets
Our total net assets amount to US$2.17 per share, which compares with US$2.04 per share at 30 September
2017. Assets outside Africa, net of non-controlling interests and proposed dividends, stand at US$61,111,000,
equal to US$1.70 per share (30 September 2017: US$1.65); the balance of US$16,854,000, equal to US$0.47
per share, is held in South Africa.
Interim Dividend
We are pleased to announce that the Company is to pay an interim dividend of US1.9 cents per share. The
dividend is payable on 20 July 2018 to shareholders on the register at the close of business on 13 July 2018.
Prospects
Our trading businesses have had a strong start to the year. However, we do expect activity levels to ease off
through the second half. Our strong balance sheet gives us confidence that we can continue to enhance
shareholder value in the long term.
A.R.C. Barclay
Chairman
D.C. Marshall
Chief Executive
Shareholders on the South African register will receive their dividend in South African Rand converted from US
dollars at the closing rate of exchange on Monday 18 June 2018. In order to comply with the requirements of
Strate the relevant details are as follows:
Shareholders are hereby advised that the exchange rate to be used will be USD 1 = ZAR 13.6813. This has been
calculated as the average of the bid/ask spread at 16.00 (United Kingdom time) being the close of business on
Monday 18 June 2018.
In respect of the normal gross cash dividend of US1.9 cents (25.99447 South African cents), and in terms of the
new South African Tax Act, the following dividend tax ruling only applies to those shareholders who are
registered on the South African register at close of business on Friday 13 July 2018. All other shareholders are
exempt. The gross dividend is for the six-month period ended 31 March 2018 and will be paid on Friday 20 July
2018.
- The dividend has been declared from income reserves, which funds are sourced from the Jersey holding
company’s main bank account in Luxembourg.
- The dividend withholding tax rate is 20% resulting in a net dividend of US1.52 cents (20.79558 South
African cents) per share to those shareholders who are not exempt from the dividend withholding tax.
The issued number of shares at the declaration date is 35,857,512. The company’s Jersey tax number is
CH4513.
Salient dates for dividend
Last day to trade Tuesday 10 July 2018
Shares trade ex-dividend Wednesday 11 July 2018
Record date (date shareholders recorded in books) Friday 13 July 2018
Pay date Friday 20 July 2018
No dematerialisation or rematerialisation of share certificates, nor transfer of shares between the registers in
Jersey and South Africa will take place between Wednesday 11 July 2018 and Friday 13 July 2018, both dates
inclusive.
Contacts and Addresses
Registered Office
rd
3 Floor, 37 Esplanade,
St Helier,
Jersey,
JE2 3QA
South Africa
11 Sunbury Park, La Lucia Ridge Office Estate,
La Lucia, 4051
(PO Box 4126, The Square 4021)
Tel: +27 31 566 7600
Company Secretary
City Group P.L.C.
6 Middle Street,
London, EC1A 7JA
Tel: +44 20 7796 9060
E-mail: monteagle@city-group.com
Consolidated Statement of Total Comprehensive Income
Half years ended Year Ended
31 March 30 September
2018 2017 2017
Notes Unaudited Unaudited Audited
US$000 US$000 US$000
Continuing operations
Group revenue 2 194,637 161,092 340,052
Other income 3a 1,611) 1,137) 3,269)
196,248 162,229 343,321
Change in inventories of finished goods and work in progress (2,436) (3,400) 4,938
Finished goods, raw materials and consumables (151,849) (124,995) (283,940)
Employee benefit expense (8,967) (7,626) (16,221)
Depreciation and amortisation expense (558) (452) (927)
Other expenses 3b (24,694) (20,005) (34,490)
Share of associated companies and joint venture’s results 40 33 36
Finance Expense (1,138) (532) (2,316)
Profit before taxation on continuing operations 2 6,646 5,252 10,401
Taxation (2,745) (1,894) (2,902)
Profit after taxation 3,901) 3,358) 7,499)
Profit attributable to owners of the parent 2,298 2,067 4,985
Profit attributable to non-controlling interests 1,603 1,291 2,514
Basic and fully diluted earnings per share (US cents) 4 6.4c 5.8c 13.9c
Basic and fully diluted earnings per share (US cents) –
continuing operations 6.4c 5.8c 13.9c
Consolidated Statement of Total Comprehensive Income (continued)
Half years ended Year ended
31 March 30 September
2018 2017 2017
Notes Unaudited Unaudited Audited
US$000 US$000 US$000
Other Comprehensive (Expense)/Income:
Items that may be reclassified subsequently to profit and
loss:
Exchange differences on translation into US dollars of the
financial statements of foreign entities 4,461 784 453
Unrealised (loss)/gain on revaluation of available for sale
investments 151 (72) 2,093
Less applicable tax 14 (81) (223)
Reclassification of previously recognised profits on disposal
of available for sale investments (203) (11) (89)
Total of items that may be reclassified 4,423 620 2,234
Items that will not be reclassified subsequently to profit and
loss:
Commercial property fair value adjustments - - 510
Less applicable tax - - (85)
-) -) 425)
Total Other Comprehensive Income 4,423) 620) 2,659)
Total Comprehensive Income 8,324 3,978 10,158
Total Comprehensive Income attributable to owners of the
parent 5,389 2,466 7,388
Total Comprehensive Income attributable to non-
controlling interests 2,935 1,512 2,770
Interim dividend per share (US cents) 1.9c 1.8c 1.8c
Final dividend per share (US cents) - - 1.9c
Consolidated Statement of Changes in Equity
Ordinary Total Non-
Share Share Other Retained Shareholders’ Controlling Group
Capital Premium Reserves Earnings Interests Interests Total
Half year ended 31 March 2017 US$000 US$000 US$000 US$000 US$000 US$000 US$000
Profit after taxation - - - 2,067 2,067 1,291 3,358
Other Comprehensive Income - - (108) 507) 399) 221) 620)
Total Comprehensive Income - - (108) 2,574) 2,466) 1,512) 3,978)
Balances at start of period
Transfer – release of fair value 8,964 23,606 (2,719) 37,344 67,195 8,002 74,897
Transactions with shareholders - - - - - - -
Dividends paid - - -) (681) (681) (1,753) (2,434)
Balances at end of period 8,954 23,606 (2,827) 39,237) 68,980) 7,761) 76,741)
Half year ended 31 March 2018
Profit after taxation - - -) 2,298 2,298 1,603 3,901
Other Comprehensive Income - - 1,743) 1,348) 3,091) 1,332) 4,423)
Total Comprehensive Income 1,743) 3,646) 5,389) 2,935) 8,324)
Transfer – release of fair value
Balances at start of period 8,964 23,606 (773) 41,460 73,257 9,040 82,297
Transactions with shareholders - - -) - - - -
Dividends paid - - -) (681) (681) (1,008) (1,689)
Balances at end of period 8,964 23,606 970) 44,425) 77,965) 10,967) 88,932)
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Consolidated Statement of Financial Position
31 March 30 September
2018 2017 2017
Unaudited Unaudited Audited
US$000 US$000 US$000
Non-current assets
Investment property 22,268 20,705 20,923
Property, plant and equipment 12,557 9,477 10,397
Goodwill 209 185 183
Intangible assets 817 537 717
Deferred taxation 2,173 1,415 2,293
Associates 236 186 187
General portfolio – (note 5) 31,258) 25,387) 27,994)
69,518) 57,892) 62,694)
Current assets
Inventories 30,505 20,915 29,162
Trade and other receivables 73,580 53,319 57,152
Cash 19,932) 31,666) 21,177)
124,017) 105,900) 107,491)
Total assets 193,135) 163,792) 170,185)
Current liabilities
Trade and other payables (82,760) (66,788) (68,096)
Financial liabilities on assets held for sale -) -) -)
Total current liabilities (82,760) (66,788) (62,422)
Net current assets 41,257) 39,112) 39,395)
Total assets less current liabilities 110,775) 97,004) 102,089)
Non-current liabilities
Accounts payable (15,312) (14,338) (13,571)
Deferred taxation (6,531) (5,925) (6,221)
Total non-current liabilities (21,843) (20,263) (19,792)
88,932) 76,741) 82,297)
Capital and reserves
Called up share capital 8,964 8,964 8,964
Share premium account 23,606 23,606 23,606
Other reserves 970 (2,827) (773)
Retained earnings 44,425) 39,237) 41,460)
Equity attributable to owners of the parent 77,965 68,980 73,257
Non-controlling interests 10,967) 7,761) 9,040)
88,932) 76,741) 82,297)
Net assets per share US$ (note 6) 2.17 1.92 2.04
Consolidated Statement of Cash Flow
31 March 30 September
2018 2017 2017
7
31 March 30 September
Unaudited Unaudited Audited
US$000 US$000 US$000
Profit for the period 3,901 3,358 7,499
Adjusted for:
Taxation 2,745 1,894 2,902
Depreciation 558 452 927
Share of associates (40) (33) (36)
Finance expense 1,138 532 2,316
Other income (1,611) (1,137) (3,269)
Other expense –fair value adjustments and losses on disposal 504 15 893
Changes in working capital:
Decrease in inventories 2,699 3,741 (4,675)
(Increase) in debtors (10,021) (4,673) (11,492)
Increase in creditors 894) 7,167) 8,171)
767 11,316 236
Interest paid (1,138) (532) (2,316)
Taxation paid (1,202) (3,518) (2,943)
Net cash (outflow)/inflow from operating activities (1,573) 7,266) (5,023)
Investment activities
Purchase of, and improvements to, tangible non-current assets (1,350) (273) (1,626)
Proceeds of disposal of tangible assets 6 24 1,452
Purchase of software - - (190)
Acquisition of investments (3,853) (318) (839)
Proceeds on disposal of investments 759 574 280
Dividends received 271 182 693
Interest received 416) 302) 869)
Net cash (outflow)/inflow from investment activities (3,751) 491) 639)
Cash (outflow)/inflow before financing (5,324) 7,757) (4,384)
Financing activities
Drawdown of long-term loans 1,428 1,491 1,238
Repayment of long term loans (63) (2,425) (56)
Dividends paid – Group shareholders (681) (681) (1,326)
Dividends paid – non-controlling interests of subsidiaries (1,008) (1,753) (1,732)
Cash (outflow) from financing activities (324) (3,368) (1,876)
Net (decrease) increase in funds (5,648) 4,389 (6,260)
Net funds at start of period 14,337 20,544 20,544
Effect of foreign exchange rates (1,021) 140) 53)
Net cash and cash equivalents at end of period 7,668) 25,073) 14,337)
Notes to the interim statement
1. The results and the cash flow statement for the half-year ended 31 March 2018 are unaudited and comply
with IAS 34 – Interim Financial Reporting as well as the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting
Standards Council. They have been prepared on the basis of accounting policies adopted in the accounts
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for the year ended 30 September 2017. They comply with International Financial Reporting Standards and
JSE listing requirements. The results for the year to 30 September 2017 are an abridged version of the
Group’s full accounts for that year, which have been filed with the relevant authorities.
These results were prepared under the supervision of Edward Beale, The Group’s finance director.
Any reference to the future financial performance of the Group has not been reviewed or reported on by
the Group’s auditors.
2. The segmental analysis of revenue and operating profit is as follows:
Half years ended 31 March Year ended 30
2018 2017 September 2017
US$000 US$000 US$000
Revenue Result Revenue Result Revenue Result
Analysed by activity: -
Import/distribution 193,053 6,867 159,702 4,761 337,256 11,022
Property 1,584 496 1,390 334 2,796 421
Share of associated companies
and joint venture results - 40) - 33) - 36)
194,637 7,403 161,092 5,128 340,052 11,479
Unallocated expense (1,230) (481) (2,031)
Other Income 1,611 1,137 3,269
Interest paid (1,138) (532) (2,316)
Profit before tax 6,646 5,252 10,401
Taxation (2,745) (1,894) (2,902)
Profit for the period 3,901) 3,358) 7,499)
3. The other income and expense on continuing operations arises from the following:
31 March 30 September
2018 2017 2017
US$000 US$000 US$000
a. Other income
Investment property revaluations - - 494
Gain on disposal of investment property - 10 -
Gain on disposal of non-current tangible assets - 29 25
Recovery of impairment on commercial property - - 37
Fair value adjustments on foreign exchange contracts - - 64
Dividend income 251 182 657
Interest and other income 467 302 1,341
Exchange gains 665 222 255
Profit on disposal of investments 227 392 396
1,611 1,137 3,269
Notes to the interim statement (continued)
31 March 31 March 30 September
2018 2017 2017
US$000 US$000 US$000
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b. Other expense
Investment property revaluations - - (221)
Loss on disposal on non-current tangible assets (19) (15) (18)
Exchange losses (485) (107) (654)
Administration and other expenses (24,190) (19,883) (33,597)
(24,694) (20,005) (34,490)
4. Basic earnings per share are based on results attributable to members and on 35,857,512 shares in issue
(2017 – 35,857,512). A reconciliation of basic and headline earnings is shown below.
31 March 31 March 30 September
2018 2017 2017
US$000 US$000 US$000
Reconciliation between basic and headline earnings
Basic earnings 2,298 2,067 4,985
Adjusted for:
Investment property gain on disposal/revaluations - - (88)
Investment property revaluation - - (229)
Impairment of non-current asset - - (37)
Reclassification of previously recognised gains on
disposal of available for sale investments (203) (11) (89)
Loss/(profit) on disposal of non-current tangible assets 19) 5) (7)
Headline earnings 2,113) 2,061) 4,535)
Earnings per share
Basic earnings per share (US cents) 6.4 5.8 13.9
Headline earnings per share (US cents) 5.9 5.8 12.6
5. A geographical analysis of the General Portfolio of investments is as follows:
31 March 31 March 30 September
2018 2017 2017
US$000 US$000 US$000
United States of America 10,513 9,556 9,951
United Kingdom 8,401 5,047 5,911
Europe, excluding the U.K. 5,201 4,778 5,422
Switzerland 2,486 2,428 2,650
Japan 1,686 1,365 1,435
28,287 23,174 25,369
Unlisted – UK 2,971 2,213 2,625
31,258 25,387 27,994
6. Net assets per share are based on equity attributable to owners of the Company.
7. There was capital expenditure of US$1,350,000 during the period (2017 – US$668,000). There was no
contracted or outstanding authorised capital expenditure at the reporting date.
Registered Office:
3rd Floor, 37 Esplanade,
St. Helier, Jersey, JE2 3QA
Channel Islands
United Kingdom
10
22 June 2018
Sponsor: Sasfin Capital (a member of the Sasfin group)
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