Final Results
Meikles Africa Ld
14 May 2001
MEIKLES AFRICA LIMITED
Preliminary Results for the year ended 31st March 2001
Meikles Africa Limited, the Southern African hotel and retail group, which is
listed on the Zimbabwe and London Stock Exchanges, announces preliminary
results for the year ended 31st March 2001.
* Turnover up 41.9% from Z$6.7 billion to Z$9.5 billion
* Operating profit up 20 % from Z$790 million to Z$951 million
* Operating cashflow per share: Z$7.45 (200: Z$6.06)
* Headline earnings per share: Z$9.64 (200: Z$2.33)
* Final dividend per share: 150 cents
14 May 2001
Enquiries:
Meikles Africa Tel: + 263 4 252 068
Chris Parvin, Chief Executive
College Hill Tel: +20 7457 2020
Corinna Dorward
GROUP COMMENTARY
FINANCIAL
Inflation Adjusted Accounts
The Group has seen a decline in turnover of 9.8% to $11,7 billion after
applying inflation indices to last year's and the current years figures. Costs
have been well controlled and are marginally lower than last year. Operating
profit of $223 million, is down from $719 million, reflecting the decline in
turnover and a lower gross margin level.
Finance income of $585 million compares very favourably with the charge of
$558 million in the previous year. This improvement is due to exchange gains
of $1,4 billion and the decline in interest rates charged in the last quarter
of the year. The Group continues to be financially sound with low cost local
borrowings covered by US dollar deposits.
The inclusion of the Group's share of Kingdom Financial Holdings profits
amounts to $117 million before tax. It should be noted that because Kingdom
Financial Holdings is included in the Groups results as an associate, the
uplift in the value of the investment amounting to $1,9 billion has not been
taken to account in these financial statements.
Headline earnings per share and cashflow earnings per share of 410 cents (2000
: loss per share of 715 cents) and 272 cents (2000 : nil) respectively, show
marked growth in the current year.
Historical Cost Accounts
Group turnover increased by 41.9% to $9,5 billion and the operating profit
increased by 20.4% to $951 million, reflecting trading in a difficult and
deteriorating environment in Zimbabwe.
Finance income includes exchange gains of $1,138 million and, together with
the inclusion of our share of the Kingdom profits of $201 million, has
resulted in an increase in profit before taxation from $487 million to $1,618
million.
At the attributable level headline earnings per share have shown significant
growth to 964 cents from 233 cents last year.
OPERATIONS
TM Supermarkets
* Turnover increased by 50% from $4,8 billion to $7.2 billion.
* Margins were positively affected by the continued success of own brand
products.
* Operating profit improved to $510 million (last year $333 million).
* New supermarkets were opened at Bradfield in Bulawayo, Budiriro in
Harare, Sakubva in Mutare and in Ruwa and all performed above expectation.
* A new flagship Borrowdale branch in Harare is to open before Christmas
2001.
Retail Division
* Turnover increased by 25% from $1.2 billion to $1.5 billion.
* Operating profit increased by 61% to $399 million (last year $248
million) mainly through better credit performance, reduced stocks and
tight controls.
* The Clicks/Diskom operating profit contributed $16 million (last year $3
million) with 3 new stores opening during the year.
Hotel Division
* Turnover increased by 22% from $651 million to $795 million.
* Operating profit decreased by 46% to $122 million (last year $224
million).
* Both Zimbabwe hotels made profit contributions.
* The decline in tourism and business arrivals severely affected
occupancies in both the Zimbabwe Hotels.
* The Cape Grace Hotel in Cape Town is reported for the first time on a
full year basis.
* The group's 50% share of the Cape Grace's operating profit increased by
159% to $60 million.
* Meikles Hotel was voted one of 'The Top Ten Best Foreign Hotels in the
World' by the Daily Telegraph Survey in October 2000.
* Cape Grace nominated as the best hotel in the world by the American
readers of Conde Nast magazine.
* Both Meikles Hotel and the Victoria Falls Hotel remain members of the
Leading Hotels of the World and the Cape Grace during the year became a
member of Leading Small Hotels of the World.
Kingdom Financial Holdings
* The group's share of Kingdom's attributable profits is $136 million.
* The group has actively supported the Kingdom retail bank initiative with
7 branches being opened by 31 March 2001 with plans well advanced for
further openings in the coming year.
DIVIDEND ANNOUNCEMENT
On 10th May 2001, the Board approved a final dividend number 63 of 150 cents
per share on the shares payable to members registered in the books of the
Company at the close of business on Friday 22nd June 2001. The Transfer Books
and Register of Members will be closed from 23rd June to 9th July 2001.
Dividend cheques will be mailed to shareholders on or about 9th July 2001. The
dividends payable to non-resident shareholders will be paid in accordance with
Exchange Control Regulations. Shareholders' withholding tax will be deducted
where applicable.
The Annual General Meeting of the Company will be held in Harare on 1st August
2001, details of which will be provided in the Annual Report.
By order of the Board
A P LANE-MITCHELL
Company Secretary
10th May 2001
CONSOLIDATED INCOME STATEMENT
for the year ended 31 March 2001
INFLATION ADJUSTED HISTORICAL COST
Audited Audited Audited Audited
(Z$ 000's) Year Year Year Year
ended ended ended ended
31 31 31 31
March March March March
2001 2000 2001 2000
Turnover 11,675,949 12,943,594 9,450,787 6,660,524
Cost of sales (9,069,256) (9,870,807) (6,864,980) (4,782,446)
Gross Profit 2,606,693 3,072,787 2,585,807 1,878,078
Operating expenses (2,988,706) (2,911,659) (2,158,733) (1,393,685)
Other income 604,857 558,365 523,995 305,275
Operating profit 222,844 719,493 951,069 789,668
Finance income/ 585,247 (558,048) 465,952 (302,396)
(costs)
Profit after finance 808,091 161,445 1,417,021 487,272
income/(costs)
Share of result of 117,337 - 200,517 -
associate
Net monetary loss (579,934) (978,203) - -
Profit/(Loss) before 345,494 (816,758) 1,617,538 487,272
taxation
Taxation 24,014 (115,044) (107,838) (79,409)
Profit after taxation 369,508 (931,802) 1,509,700 407,863
Minority interest (102,541) (222,293) (112,580) (76,024)
Net profit/ (loss) 266,967 (1,154,095) 1,397,120 331,839
attributable to
shareholders
Basic earnings per 174 -754 912 217
share (cents)
IIMR Headline earnings 410 -715 964 223
per share (cents)
CONSOLIDATED STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
FOR THE YEAR ENDED 31 MARCH 2001
Net profit/(loss) for 266,967 (1,154,095) 1,397,120 331,839
the year
attributable to
shareholders
Net gains/(losses) not
recognised in the
income statement:
- Decrease in value of (3,219) (280,138) (3,073) (135,841)
quoted investments
- Capital gains 46,330 128,785 1,449 27,717
deferred tax
Total recognised gains 310,078 (1,305,448) 1,395,496 223,715
and losses
CONSOLIDATED BALANCE SHEET
At 31 March 2001
(Z$ 000's) INFLATION ADJUSTED HISTORICAL COST
Audited Audited Audited Audited
At At At At
31 March 31 March 31 March 31 March
2001 2000 2001 2000
ASSETS
Non-current assets 5,467,249 5,673,169 3,393,092 2,607,202
Current assets 5,237,153 5,386,766 5,124,568 3,341,062
Total assets 10,704,402 11,059,935 8,517,660 5,948,264
EQUITY AND LIABILITIES
Capital and reserves 5,744,894 5,640,218 4,211,186 2,926,342
Minority interest 151,241 141,686 67,106 38,960
Non-current liabilities 3,370,229 3,565,778 2,801,330 1,883,771
Current liabilities 1,438,038 1,712,253 1,438,038 1,099,191
Total equity and 10,704,402 11,059,935 8,517,660 5,948,264
liabilities
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 March 2001
INFLATION Share Share Non- Retained Total
ADJUSTED Capital Premium Distributable Earnings and
(Z$ 000's) Reserves Shareholders
for dividend
Balance at 1 76,934 4,792,549 808,473 (37,738) 5,640,218
April 2000
Net
gains/(losses)
not
recognised
in income
statement
- Change in - - - 43,111 43,111
value of
quoted
investment
- Cape Grace - - 125,199 - 125,199
Hotel
Share 162 36,066 - - 36,228
options
exercised
Net profit - - - 266,967 266,967
Dividend for - - - (238,202) (238,202)
2000 - final
Dividend for - - - (128,627) (128,627)
2001 - Interim
Balance at 31 77,096 4,828,615 933,672 (94,489) 5,744,894
March 2001
Balance at 1 76,931 4,791,601 821,250 1,833,074 7,522,856
April 1999
Net
gains/(losses)
not
recognised in
income
statement
- Change in - - - (151,353) (151,353)
value of
quoted
investment
- Cape Grace (12,777) - (12,777)
Hotel
Share options 3 948 - - 951
exercised
Net loss - - - (1,154,095) (1,154,095)
Dividend for - - - (359,157) (359,157)
1999 - final
Dividend for - - - (206,207) (206,207)
2000 -
Interim
Balance at 31 76,934 4,792,549 808,473 (37,738) 5,640,218
March 2000
HISTORICAL Share Share Non- Retained Total
COST Capital Premium Distributable Earnings and
(Z$ 000's) Reserves Shareholders
for dividend
Balance at 1 15,291 895,533 145,191 1,870,327 2,926,342
April 2000
Net gains/
(losses) not
recognised in
income statement
- Change in value - - - (1,624) (1,624)
of quoted
investment
- Cape Grace - - 117,374 - 117,374
Hotel
Share options 143 32,105 - - 32,248
exercised
Net profit - - - 1,397,120 1,397,120
Dividend for 2000 - - - (152,915) (152,915)
- final
Dividend for 2001 - - - (107,359) (107,359)
- Interim
Balance at 31 15,434 927,638 262,565 3,005,549 4,211,186
March 2001
Balance at 1 15,289 894,975 153,393 1,906,534 2,970,191
April 1999
Net
gains/(losses)
not recognized in
income statement
- Change in value - - - (108,124) (108,124)
of quoted
investment
- Cape Grace - - (8,202) - (8,202)
Hotel
Share options 2 558 - - 560
exercised
Net loss - - - 331,839 331,839
Dividend for 1999 - - - (152,895) (152,895)
- final
Dividend for 2000 - - - (107,027) (107,027)
- Interim
Balance at 31 15,291 895,533 145,191 1,870,327 2,926,342
March 2000
CONSOLIDATED CASH FLOW STATEMENT
For the year ended 31 March 2001
(Z$ 000's) INFLATION ADJUSTED HISTORICAL COST
Audited Audited Audited Audited
Year Year Year ended Year ended
ended ended
31 March 31 March 31 March 31 March
2001 2000 2001 2000
Cash flows from operating activities
Profit/(Loss) before taxation 345,494 (816,758) 1,617,538 487,272
Adjustment for:
Non-operating cash flow (554,858) 569,986 (475,203) 300,088
Non-cash items 436,729 439,357 70,723 106,514
Operating cash flow before working
capital changes 227,365 192,585 1,213,058 893,874
Generated from/(used in) working
capital changes 189,545 (203,829) (71,777) 32,887
Operating cash flow 416,910 (11,244) 1,141,281 926,761
Income tax paid (168,831) (151,223) (101,630) (71,608)
Net cash generated from/ (used) 248,079 (162,467) 1,039,651 855,153
operating activities
Net cash generated from/ (used in) 164,250 (512,165) (392,493) (777,683)
investing activities
Net cash used in financing
activities (1,491,114) (899,834) (356,171) (94,126)
Net effect of exchange rate changes
on cash and cash equivalents 1,422,288 (17,635) 1,138,439 (8,627)
Net increase/ (decrease) in cash and
cash equivalents 343,503(1,592,101) 1,429,426 (25,283)
Cash and cash equivalents at
31 March 2000 3,032,928 4,609,371 1,947,005 1,962,236
Cash acquired with joint venture 15,658 10,052
Cash and cash equivalents at
31 March 2001 3,376,431 3,032,928 3,376,431 1,947,005
Accounting policies
The accounting policies are the same as those used in preparing the 31st March
2000 annual financial statements and have been prepared in accordance with IAS
29 (Financial Reporting in hyperinflationary economies).
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