Zambeef: Financial year saw strong performance for meat, feed operations
Zambeef, a fully integrated agribusiness with operations in Zambia, Nigeria and Ghana, has provided an update on its performance for the year ending September 30, 2016.
The audited annual results are expected to be announced on November 25.
The strong trading performance of the first six months of the financial year has continued with beef, pork, dairy and stock feed operations, in particular, all showing strong volume growth. This is largely due to the ongoing roll-out of the macro retail stores.
The conclusion of the CDC Group plc transaction (as initially announced on August 4 this year) resulted in a US$65 million investment into Zambeef. This enabled the company to settle the two RCL Foods plc put options as well as substantially reducing the Group's indebtedness. This is in line with Zambeef's strategy of unlocking value within the Group whilst minimising shareholder dilution and reducing debt and gearing.
During the second half of the financial year, the Zambian Kwacha has continued to remain relatively stable against the US dollar, and the Group is expected to incur foreign exchange gains for the financial year.
In view of this, the Group expects the US dollar reported profits for the year to September 30, 2016, to be materially higher than current market expectations.
"In line with the Group's strategy, it is pleasing to note that gearing has been reduced significantly following the CDC transaction, which also allowed Zambeef to settle the two RCL Foods plc put options," said Carl Irwin, joint chief executive of Zambeef. "Furthermore, driving the cold chain food products through the retail network will continue to be a key focus."