Half-year Report

Kakuzi Ld

25 August 2023

 

KAKUZI PLC

EXTRACT FROM THE INTERIM FINANCIAL STATEMENTS

FOR THE PERIOD OF SIX MONTHS TO 30 JUNE 2023

The unaudited results for the Kakuzi Group for the period of six months to 30 June 2023 and the comparative figures for the previous year are as follows:

Condensed Consolidated Statement of Profit or Loss and other Comprehensive Income
			30 June 2023		30 June 2022
			Shs'000		Shs'000
Sales			873,155		1,026,492
Profit before fair value gain in non-current biological assets and income tax			149,528		471,842
Fair value gain in non-current biological assets			21,591		22,826
Profit before income tax			171,119		494,668
Income tax expense			(53,621	)	(153,398	)
Profit for the period			117,498		341,270
Other Comprehensive Income:
Items that are not reclassified to profit or loss:
Remeasurement of post-employment benefit obligations (net of tax)			-		-
Total comprehensive income			117,498		341,270
			Shs		Shs
Earnings per share (Shs):
Basic and diluted earnings per ordinary share			5.99		17.41

Condensed Consolidated Statement of Financial Position
									Audited
					30 June 2023		30 June 2022		31 December 2022
					Shs'000		Shs'000		Shs'000
EQUITY
Share capital					98,000		98,000		98,000
Other reserves					32,815		37,991		32,815
Retained earnings					5,465,134		5,313,502		5,347,636
Proposed dividends					-		-		470,400
Total equity					5,595,949		5,449,493		5,948,851
Non-current liabilities					1,203,079		1,098,845		1,187,237
					6,799,028		6,548,338		7,136,188
REPRESENTED BY
Non-current assets					4,097,646		3,999,063		4,089,669
Cash and cash balances					239,675		840,966		1,408,744
Other current assets					2,842,579		2,259,249		1,983,022
Current liabilities					(380,872	)	(550,940	)	(345,247	)
Net current assets					2,701,382		2,549,275		3,046,519
					6,799,028		6,548,338		7,136,188

Condensed Consolidated Statement of Cash flows
			30 June 2023		30 June 2022
			Shs'000		Shs'000
Cash and cash equivalents at the beginning of the period			1,408,744		1,656,219
Net cash used in operating activities			(597,169	)	(188,424	)
Net cash used in investing activities			(159,841	)	(225,311	)
Net cash used in financing activities			(470,400	)	(431,201	)
Effect of exchange rate differences on cash and cash equivalents			58,341		29,683
Decrease in cash and cash equivalents			(1,169,069	)	(815,253	)
Cash and cash equivalents at the end of the period			239,675		840,966

Condensed Consolidated Statement of Changes in Equity
	Share capital		Other reserves		Retained earnings		Proposed dividends		Total Equity
	Shs'000		Shs'000		Shs'000		Shs'000		Shs'000
At start of the period	98,000		32,815		5,347,636		470,400		5,948,851
Profit for the period	-		-		117,498		-		117,498
Dividends paid	-		-		-		(470,400	)	(470,400	)
At end of period	98,000		32,815		5,465,134		-		5,595,949

KEY HIGHLIGHTS

·  Avocado profits have more than doubled in 2023 to Ksh 654.8 million, up from Ksh 288.6 million in 2022

·  Global Macadamia glut persists leading to a Kshs 329 million sectoral loss for the macadamia business

·  Recovery expected as Kakuzi Macadamia domestic market retail sales efforts doubled up to mitigate international market risks

·  Pretax profit down by 65% to Ksh 171.1 million from Kshs 494.7 million

·  Avocado exports to China up on last year.

TRADING PERFORMANCE

The half-year trading period for the financial year 2023 are in line with our expectations given the challenging macadamia markets.  As highlighted at the Annual General Meeting, we expect the global macadamia glut situation to persist throughout the balance of 2023 financial year and may be into 2024.

In 2022 the half year profits for the macadamia business were posted at Ksh 339 million. This year the situation has reversed to a loss of Ksh (329) million.  The disappointment is that in our biggest markets of China, Japan and the USA, the same quality macadamia nut kernels are now selling for less than half the price recorded during the same period last year even as production volumes from all source markets continue to grow.

We remain committed to a shared prosperity business model that prioritizes all our stakeholder needs. Growing our business in a sustainable manner, actively implementing our Kakuzi, Community Partnerships, answering the call for climate action and using best practices in all we do to promote our values remains our focus.

The Directors do not recommend the payment of an Interim Dividend.

BY ORDER OF THE BOARD

NICHOLAS NG'ANG'A

CHAIRMAN                                                                                                                                                 

24 AUGUST 2023                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

 

END