2011 Preliminary Results Statement
Origin Enterprises plc
Preliminary Results Statement
Year Ended 31 July 2011
Results Summary
|
|
2011 €'000 |
2010 €'000 |
% Change |
|
Group revenue |
|
|
|
|
|
|
|
|
|
Agri-Services |
1,257,498 |
1,077,009 |
16.8% |
|
Food - discontinued operations |
44,240 |
260,056 |
(83.0%) |
|
Total group revenue |
1,301,738 |
1,337,065 |
(2.6%) |
|
|
|
|
|
|
Group operating profit * |
|
|
|
|
Agri-Services |
65,963 |
50,998 |
29.3% |
|
Food - discontinued operations |
5,051 |
14,856 |
(66.0%) |
|
|
71,014 |
65,854 |
7.8% |
|
Associates and joint venture |
14,857 |
11,572 |
28.4% |
|
Total group operating profit * |
85,871 |
77,426 |
10.9% |
|
|
|
|
|
|
Adjusted diluted EPS (cent)** |
43.34c |
37.26c |
16.3% |
|
Group net debt |
92,120 |
111,889 |
(17.7%) |
|
Dividend per ordinary share (cent) |
11.0 |
9.0 |
22.2% |
* Before intangible amortisation and exceptional items
** Before intangible amortisation, net of related deferred tax (2011: €2.6m, 2010: €3.1m) and exceptional items, net of tax (2011: €11.6m, 2010: €Nil).
Highlights
· Excellent financial and operating result underpinned by a buoyant trading environment for primary producers supporting firm demand for agronomy services and inputs
· Significant repositioning of non-core business followed by acquisition development in the year transforming Origin to a focused Agri-Services group
· Operating profit* increase of 29.3% from Agri-Services to €66.0m
· Operating profit* margin from Agri-Services division up 50 basis points to 5.2%
· Adjusted diluted earnings per share** up 16.3% to 43.34c
· Strong cash flow performance resulting in a net debt reduction of €19.8m to €92.1m
· Proposed dividend increased by 22.2% to 11.0 cent per ordinary share
Origin Enterprises plc
Chief Executive Officer's comment:
Commenting on the announcement of the 2011 results, Origin Chief Executive Officer, Tom O'Mahony said:
"Origin achieved excellent results in 2011 recording strong increases in operating profit and earnings per share in addition to robust cash generation reflecting strong underlying business momentum and earnings accretive acquisitions.
The improved backdrop for primary food production together with the sustained recovery in farm incomes has supported good volume growth and margin progression within our Agri-Services business.
The acquisition of United Agri Products, Rigby Taylor and the specialist fertiliser business of Carr's Milling Industries Plc in the year underlines the strategic realignment of the Group's business profile and firmly establishes Origin as a premier provider of integrated crop production systems and sustainable agricultural technologies.
The transition of Origin's consumer foods and feed ingredient interests, Valeo Foods and R&H Hall respectively from wholly owned businesses to associates and joint venture in the year released €74.6 million in cash to the Group whilst also enhancing their competitive positioning. These businesses are now strongly positioned to adapt to the changing needs of their customers and consumers in challenging markets.
Having established market leading positions through organic growth and acquisition, the Group is now well advanced in building an integrated platform with a unique capability to support primary producers in the management of the complex and evolving requirements of modern farming. This will transform the scope and scale of the business, providing growth opportunity through an extended technological capability, delivering an enhanced range of value added services that meet the needs of primary producers for scale and complete crop solutions."
ENDS
The Preliminary Results Statement is available on the company website www.originenterprises.com. There will be a live conference call at 8.30am (GMT) today. To listen to this conference call, please dial the number below. Participants are requested to dial in 5 to 10 minutes prior to the scheduled start time.
Confirmation Code: 2859342
Participant access number:
Dublin: +353 (0) 1 659 0423
UK/International: +44 (0) 20 3364 5381
Switzerland: +41 (0) 43 547 8000
Replay:
A replay of this call will be available until midnight on 29th September 2011.
Replay Access Code: 2859342#
Replay Access Numbers:
Dublin: +353 (0) 1 486 0902
UK/International: +44 (0) 20 7111 1244
Switzerland: +41 (0) 22 592 7553
Enquiries:
Origin Enterprises plc
Brendan Fitzgerald
Chief Financial Officer Tel: +353 (0) 1 612 1259
Murray Consultants
Joe Murray Tel: +353 (0) 1 498 0300
Tel: +353 (0) 86 253 4950
Preliminary Results Statement
Financial Review
Origin Enterprises plc ('Origin' or 'the Group'), announces a 16.3 per cent increase in adjusted diluted earnings per share* for the year ending 31 July 2011 to 43.34 cent compared to 37.26 cent in 2010.
Revenue
Group revenue was €1,301.7 million compared to €1,337.1 million in the previous year. The Agri-Services business achieved revenues of €1,257.5 million, an increase of €180.5 million (16.8 per cent) over the previous year. On a like for like basis (excluding the impact of acquisitions, the transition of R&H Hall to associates and joint venture and currency movements) Agri-Services revenues increased by €204.1 million (19.0 per cent) reflecting higher global nutrition and feed prices and good volume growth.
The Food business, which is now presented as discontinued following the transition of Valeo Foods to associates and joint venture, generated revenue in the period to November 2010 of €44.2 million, a decrease of €215.8 million (83.0 per cent) over the previous year to 31 July 2010.
Operating profit**
Operating profit** for the year increased by 10.9 per cent to €85.9 million from €77.4 million in the previous year. €61.8 million of operating profit** was generated in the seasonally more important second half of the year, an increase of €5.5 million (9.8 per cent) on the second half of 2010.
Operating profit** before contributions from associates and joint venture increased by 7.8 per cent to €71.0 million from €65.9 million in the previous year. On a like for like basis (excluding the impact of acquisitions, disposals and currency movements) operating profit** before contributions from associates and joint venture increased €6.7 million (10.2 per cent).
Operating profit** from the Agri-Services businesses amounted to €66.0 million compared to €51.0 million in the prior year representing an increase of €15.0 million (29.3 per cent) on the previous year. The acquisitions of United Agri Products, Rigby Taylor and the fertiliser business of Carr's Milling Industries Plc contributed €11.7 million to the increase, the strength of sterling against the euro contributed €1.0 million to the increase whereas the transitioning of R&H Hall to associates and joint venture adversely affected the Agri-Services result by €1.9 million. Excluding these, operating profit** from Agri-Services increased by €4.2 million (8.2 per cent) on a like for like basis.
Operating profit** from the Food business declined from €14.9 million to €5.1 million as a result of the transitioning of Valeo Foods to associates and joint venture and the related wind-down of the Masterfoods distribution services contract.
Associates and joint venture
Origin's share of the profit after interest and taxation from associates and joint venture increased €3.3 million (28.4 per cent) from €11.5 million to €14.8 million principally reflecting a first time contribution from Valeo Foods and an improved performance from Continental Farmers Group Plc. Welcon performed in line with its very strong prior year performance.
Finance costs and net debt
Net finance costs amounted to €10.5 million, a decrease of €4.7 million (30.9 per cent). Average net debt amounted to €166 million compared to €209 million last year reflecting the cash proceeds from the Valeo Foods and R&H Hall transactions and the cash generative nature of the business offset by acquisition expenditure of €79.3 million.
Net debt at 31 July 2011 was €92.1 million compared with €111.9 million at the end of the previous year and is 1.17 times EBITDA***.
Investment in working capital is a key area of focus for the Group given the funding costs and the related risks in the current environment. The year end represents the low point in the working capital cycle for the Group reflecting the seasonality of the business.
Adjusted diluted earnings per share ('EPS')*
EPS* amounted to 43.34 cent per share, an increase of 16.3 per cent from 2010. The 16.3 per cent increase is driven by the impact of acquisitions (15.5 per cent), underlying growth from the core business (8.9 per cent) and currency (1.9 per cent), the effects of which were partly offset by the disposal of the Food business (10.0 per cent).
Dividend
The Board is recommending a dividend of 11.0 cent per ordinary share, an increase of 22.2 per cent. Subject to shareholder approval at the Annual General Meeting, the dividend will be paid on 6 January 2012 to shareholders on the register on 16 December 2011.
Annual General Meeting (AGM)
The AGM will be held on Monday 21 November 2011 at 10.00am in the Westbury Hotel, Grafton Street, Dublin 2.
*Before intangible amortisation, net of related deferred tax (2011: €2.6m, 2010: €3.1m) and exceptional items, net of tax (2011: €11.6m, 2010: €Nil).
**Operating profit is stated before intangible amortisation and exceptional items.
***Earnings before interest, taxation, depreciation, amortisation and exceptional items.
Review of Operations
Agri-Services
|
|
2011 €'000 |
2010 €'000 |
% Change |
|
Revenue |
1,257,498 |
1,077,009 |
16.8% |
|
|
|
|
|
|
Operating profit* |
65,963 |
50,998 |
29.3% |
|
|
|
|
|
|
Operating profit %* |
5.2 |
4.7 |
50 bps |
|
|
|||
|
* Before intangible amortisation and exceptional items. |
|||
Agri-Services comprises on-farm integrated agronomy services and business-to-business agri-inputs (feed and fertiliser sourcing, handling and distribution). These businesses provide customised solutions that address the efficiency, quality and output requirements of primary food producers in Ireland, the United Kingdom and Poland. Agri-Services delivered an excellent performance during the year reflecting a buoyant agricultural operating environment which supported strong demand for agronomy services and inputs.
Revenue increased by 16.8 per cent to €1,257.5 million reflecting strong volume growth resulting from sustained recovery in farm incomes and higher nutrition pricing. Operating profit* increased by 29.3 per cent to €66.0 million or 8.2 per cent on a like for like basis (excluding the impact of acquisitions, the transition of R&H Hall to associates and joint venture and currency movements).
Integrated Agronomy Services - UK and Poland
Masstock and Dalgety Agra Polska, the Group's integrated agronomy services business in the UK and Poland respectively delivered an excellent performance during the year driven by increased on-farm activity. Ideal planting conditions during the autumn of 2010 coupled with a favourable output price environment supported an increased combinable crop area leading to growth in demand for full service agronomy applications.
During the year many primary producers faced significant spring weather challenges as near drought conditions across much of the United Kingdom and Northern Europe impacted crop yields and grass growth. Masstock and Dalgety successfully responded to these challenges on behalf of their customers through the delivery of active crop management programmes designed to protect returns.
Masstock's commitment to a fully integrated research based agronomy offering ensures the delivery of the most robust, innovative and scientifically based advice and technology for the benefit of primary food producers. This process greatly enhances the influence of the business in guiding on-farm strategic choices through a service offering that fully meets the needs of primary producers in optimising the economic yield of their enterprises.
During the year the Group endowed the 'Masstock Chair in Crop Science' at University College Dublin ('UCD'). The link with UCD and other universities and research centres is strategic as it establishes an important connection and dynamism between science, information technology and food production. New developments in crop breeding, biotechnology and crop production systems place crop science in a pivotal position regarding the future potential of primary food production.
Acquisition of United Agri Products and Rigby Taylor
In March 2011, the Group acquired United Agri Products Limited ('UAP') and Rigby Taylor, which significantly enhance and extend the Group's capability and market position in the provision of integrated crop production systems and sustainable agricultural technologies.
UAP, based in the United Kingdom, is a leading service provider to arable, fruit and vegetable growers. The business supports over 8,000 growers through a team of 100 agronomists. UAP provides tailored systems incorporating advice on crop selection, establishment, nutrition, protection and precision agronomy combined with the sale and distribution of strategic inputs. The acquisition provides important customer extension opportunity for the Group's integrated service offering as well as enabling the development of new and innovative service propositions.
The integration of Masstock and UAP will create a premier agri-services platform that is best placed to meet the requirements of the increasing professionalisation of farming and the growing demand for more sophisticated inputs and farming systems.
Rigby Taylor, is the brand leader in the provision of advice and product solutions to the professional sports turf, landscape and amenity sectors in the United Kingdom. The business delivers an important complementary channel extension for the Group's technology platform, product portfolio and distribution network.
Both UAP and Rigby Taylor were strongly earnings enhancing in the period, benefiting from favourable market conditions which underpinned strong demand for advice and prescription inputs.
Business-to-business Agri Inputs - Ireland and the UK
In Ireland primary producers are experiencing renewed optimism underpinned by strongly performing output markets, principally in the case of cereals, dairy, beef and sheep enterprises. The balance of animal numbers has continued to move in favour of dairy as farmers prepare for the expected expansion in milk output post the cessation of quota in 2015.
Fertiliser Ireland achieved a satisfactory result in the period albeit on lower volumes largely reflecting the impact of excellent grass growing conditions during the year.
Feed ingredients had a challenging year as milk quota constraints and high fodder availability suppressed demand while customers continued to adopt a cautious approach to the timing of volume commitments due to significant price volatility across major ingredients.
In January 2011, the Group and W&R Barnett Limited ('Barnett') completed the establishment of an all-Ireland grain and feed handling, logistics and trading business. The all-Ireland business was formed through the integration of Origin's wholly owned R&H Hall business in the Republic of Ireland and the business of Origin and Barnett in Northern Ireland. The combined business brings together two of Ireland's leading indigenous grain and non-grain feed ingredient importing businesses, servicing the animal feed and cereal milling industries. Committed and long-established partnerships with global ingredient shippers combined with an extensive procurement, logistics and handling capability provide proven access to international markets and sources of supply. The combination creates a single logistics platform which will support enhanced procurement synergies and a superior service offering to customers.
The Group's UK fertiliser business made excellent progress in the year growing margins and volumes as the combination of favourable nutrition pricing and the positive outlook for output prices supported firm buying interest at farm level.
Acquisition of Carrs Fertilisers
In June 2011, Origin announced the acquisition of the fertiliser business of Carr's Milling Industries Plc. The business based in Scotland and the North of England, is a leading provider of branded specialist fertilisers and nutrient management systems to the arable, grassland, horticulture and forestry sectors. The business services a complementary geographic footprint and markets an extensive range of technically based nutrition applications that strongly support Origin's existing position in the UK.
Food - Discontinued activities
|
|
2011 €'000 |
2010 €'000 |
|
Revenue |
44,240 |
260,056 |
|
Operating profit* |
5,051 |
14,856 |
|
*Before intangible amortisation and exceptional items. |
||
For the year under review Food incorporates the discontinued activities of Origin Foods for the period 1 August 2010 to 26 November 2010.
Food generated revenue for this period of €44.2 million. Operating profit* was €5.1 million a decrease of 66.0 per cent on the prior full year profits. The decreases are attributable to the completion of the Valeo Foods transaction in November 2010 and the related wind-down of the Masterfoods contract from August 2010.
The performance of the Food business for the eight months to 31 July 2011 is covered in the associates and joint venture section.
Associates and joint venture
Valeo Foods Group Limited ('Valeo')
Valeo, formed through the merger of Origin Foods and Batchelors in November 2010, is a leading consumer foods company with a portfolio of some of Ireland's most iconic staple food brands.
Valeo made satisfactory progress against the background of declining consumer confidence which is reflective of the current intensely competitive trading environment. A key focus of the business is the development of new customer sales channels and supporting existing brand portfolios through the introduction of complementary product lines. A number of tactical initiatives were implemented to meet consumer and retailer demand for greater value including the realignment of existing category and promotional support programmes. The integration of Origin Foods and Batchelors is progressing to plan and will ensure Valeo's ongoing operating cost alignment with a challenging market environment.
On 11 August 2011, Valeo announced that it reached conditional agreement to acquire Jacob Fruitfield Food Group Limited ('Jacob Fruitfield'). The acquisition of Jacob Fruitfield is in line with Valeo's strategy to grow its business and following the acquisition, Valeo will have pro forma annual revenues of approximately €300 million.
Jacob Fruitfield's portfolio of brands comprises some of Ireland's best known consumer food offerings including Jacob's biscuits, Chef sauces, Fruitfield jams and marmalades, Silvermints and Scots Clan sweets and confectionery.
Origin will subscribe €7.9 million for additional equity in Valeo and will have a 32.1 per cent shareholding in the enlarged entity, reduced from its current shareholding of 44.1 per cent.
The transaction is expected to complete by 30 September 2011.
Welcon Invest As ('Welcon')
Welcon, jointly owned by Origin and Austevoll Seafoods ASA, is Europe's largest manufacturer of marine proteins and oils servicing the aquaculture, pig and poultry feed sectors.
Welcon delivered another very strong performance in the year reflecting firm demand for marine proteins from the aquaculture feed sector and limited global unsold stocks of fishmeal and fish oil. North Atlantic raw material intake was lower as anticipated due to reduced quotas. Fishmeal usage within the pig and poultry feed markets remained stable during the period. During the latter part of the year global fishmeal markets weakened due to an increase in production resulting from a strong recovery in the South American fishing resource. Prices are stable currently reflecting increased Chinese demand and firm relative pricing for vegetable proteins.
Continental Farmers Group Plc ('Continental')
Continental, is a large scale producer of value added agriculture crops with operations in Northern Poland and Ukraine. Continental's proven farming know-how together with the benefit of operational scale facilitates the implementation of diversified cropping plans that optimise productivity and output price realisations.
In June 2011, Continental listed on the AIM and ESM markets in London and Dublin respectively raising €16.7 million. Following the flotation, Origin's shareholding was reduced from 38.7 per cent to 24.2 per cent. As the largest strategic shareholder in Continental, Origin will continue to support the business through the transfer of integrated crop production technologies and on-farm advisory portfolios. The fundraising provides the business with access to appropriate sources of capital for infrastructure development and farm land expansion.
Continental will announce its Interim Results for the six months ending 30 June 2011 on 27 September 2011.
Outlook
The positive momentum and favourable planning environment for primary producers highlights the strategic nature of farming particularly in the context of the fragile supply side dynamics of primary food production. Having established market leading positions through organic growth and acquisition, Origin is now well advanced in building an integrated platform with a unique capability to support primary producers in the management of the complex and evolving requirements of modern farming. This will transform the scope and scale of the business, providing growth opportunity through an extended technological capability to deliver an enhanced range of value added services that meet the needs of primary producers for scale and complete crop solutions.
ENDS
About Origin Enterprises plc
Origin Enterprises plc is a focused Agri-Services group providing on-farm integrated agronomy advice and the supply of agri-inputs. The Group also has interests in consumer foods and marine proteins and oils. The Agri-Services business through its manufacturing and distribution operations in Ireland, the United Kingdom and Poland has leading market positions in the supply of specialist agronomy services, crop nutrition and feed ingredients. The Group is listed on the ESM and AIM markets of the Irish and London Stock Exchanges.
ESM ticker symbol: OIZ
AIM ticker symbol: OGN
Website: www.originenterprises.com
Origin Enterprises plc
Consolidated income statement
for the year ended 31 July 2011
|
|
|
|
Pre- |
|
|
|
|
|
|
|
|
|
|
|
exceptional |
|
Exceptional |
|
Total |
|
|
Total |
|
|
|
|
2011 |
|
2011 |
|
2011 |
|
|
2010 |
|
|
|
|
€'000 |
|
€'000 |
|
€'000 |
|
|
€'000 |
|
|
Notes |
|
|
|
(Note 3) |
|
|
|
|
Restated |
|
|
|
|
|
|
|
|
|
|
|
(Note 2) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
|
|
|
|
|
|
|
|
|
Revenue |
2 |
|
1,257,498 |
|
- |
|
1,257,498 |
|
|
1,077,009 |
|
Cost of sales |
|
|
(1,092,830) |
|
- |
|
(1,092,830) |
|
|
(946,162) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gross profit |
|
|
164,668 |
|
- |
|
164,668 |
|
|
130,847 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating costs |
3 |
|
(102,764) |
|
1,790 |
|
(100,974) |
|
|
(82,677) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profit of associates and joint venture |
3 |
|
14,857 |
|
(761) |
|
14,096 |
|
|
11,572 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss on dilution of interest in associate |
3 |
|
- |
|
(4,738) |
|
(4,738) |
|
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit |
|
|
76,761 |
|
(3,709) |
|
73,052 |
|
|
59,742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Finance income |
|
|
6,106 |
|
- |
|
6,106 |
|
|
4,201 |
|
Finance expense |
|
|
(16,616) |
|
- |
|
(16,616) |
|
|
(19,414) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit before tax |
|
|
66,251 |
|
(3,709) |
|
62,542 |
|
|
44,529 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense |
|
|
(13,013) |
|
(625) |
|
(13,638) |
|
|
(8,463) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit from continuing operations |
|
|
53,238 |
|
(4,334) |
|
48,904 |
|
|
36,066 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Discontinued operations |
|
|
|
|
|
|
|
|
|
|
|
(Loss)/profit from discontinued operations |
4 |
|
4,195 |
|
(7,301) |
|
(3,106) |
|
|
11,973 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit attributable to equity shareholders |
|
|
57,433 |
|
(11,635) |
|
45,798 |
|
|
48,039 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated income statement -continued
for the year ended 31 July 2011
|
|
|
|
|
Notes |
|
2011 |
|
|
2010 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Earnings per share for the year |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
|
5 |
|
36.77c |
|
|
27.12c |
|
Discontinued operations |
|
|
|
5 |
|
(2.34c) |
|
|
9.00c |
|
|
|
|
|
|
|
34.43c |
|
|
36.12c |
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share |
|
|
|
|
|
|
|
|
|
|
Continuing operations |
|
|
|
5 |
|
35.33c |
|
|
26.25c |
|
Discontinued operations |
|
|
|
5 |
|
(2.24c) |
|
|
8.72c |
|
|
|
|
|
|
|
33.09c |
|
|
34.97c |
|
Basic earnings per share- adjusted |
|
|
|
|
|
|
|
||
|
Continuing operations |
|
|
|
5 |
|
41.79c |
|
|
28.73c |
|
Discontinued operations |
|
|
|
5 |
|
3.31c |
|
|
9.75c |
|
|
|
|
|
|
|
45.10c |
|
|
38.48c |
|
Diluted earnings per share- adjusted |
|
|
|
|
|
|
|
||
|
Continuing operations |
|
|
|
5 |
|
40.16c |
|
|
27.82c |
|
Discontinued operations |
|
|
|
5 |
|
3.18c |
|
|
9.44c |
|
|
|
|
|
|
|
43.34c |
|
|
37.26c |
Origin Enterprises plc
Consolidated statement of comprehensive income
for the year ended 31 July 2011
|
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
Result for the year |
45,798 |
|
48,039 |
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
|
|
|
|
Group/associate foreign exchange translation effects |
|
|
|
|
-foreign currency borrowings |
2,489 |
|
(2,099) |
|
-foreign currency net investments |
(4,996) |
|
1,351 |
|
-recycling on disposal of subsidiary undertakings |
379 |
|
- |
|
-share of associates and joint venture foreign exchange translation effects |
1,170 |
|
(692) |
|
|
|
|
|
|
Group/associate defined benefit pension obligations |
|
|
|
|
-actuarial gain/(loss) on Group's defined benefit pension schemes |
221 |
|
(509) |
|
-deferred tax effect of actuarial gain/ (loss) |
(307) |
|
262 |
|
-actuarial loss on associate's defined benefit scheme, net of deferred tax |
(490) |
|
(701) |
|
|
|
|
|
|
Group/associate cash flow hedges |
|
|
|
|
-effective portion of changes in fair value to cash flow hedges |
828 |
|
1,731 |
|
-fair value of cash flow hedges transferred to income statement |
3,007 |
|
433 |
|
-deferred tax effect of cash flow hedges |
(442) |
|
(227) |
|
-share of associates and joint venture cash flow hedges, net of deferred tax |
(607) |
|
- |
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive income/(expense) for the year, net of tax |
1,252 |
|
(451) |
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the year attributable to equity shareholders |
47,050 |
|
47,588 |
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated statement of financial position
as at 31 July 2011
|
|
|
2011 |
|
2010 |
|
|
Notes |
€'000 |
|
€'000 |
|
|
|
|
|
|
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Property, plant and equipment |
6 |
94,256 |
|
129,182 |
|
Investment properties |
|
16,002 |
|
16,002 |
|
Goodwill and intangible assets |
7 |
130,506 |
|
114,595 |
|
Investments in associates and joint venture |
8 |
119,081 |
|
89,741 |
|
Other financial assets |
9 |
35,013 |
|
- |
|
Deferred tax assets |
|
4,812 |
|
4,607 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Non-current assets |
|
399,670 |
|
354,127 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
Inventory |
|
103,341 |
|
82,138 |
|
Trade and other receivables |
|
220,368 |
|
179,581 |
|
Derivative financial instruments |
|
311 |
|
495 |
|
Cash and cash equivalents |
|
55,496 |
|
76,043 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current assets |
|
379,516 |
|
338,257 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL ASSETS |
|
779,186 |
|
692,384 |
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated statement of financial position -continued
as at 31 July 2011
|
|
|
2011 |
|
2010 |
|
|
Notes |
€'000 |
|
€'000 |
|
EQUITY |
|
|
|
|
|
|
|
|
|
|
|
Called up share capital |
|
1,385 |
|
1,386 |
|
Share premium |
|
160,399 |
|
160,399 |
|
Retained earnings and other reserves |
|
56,034 |
|
20,059 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY |
|
217,818 |
|
181,844 |
|
|
|
|
|
|
|
LIABILITIES |
|
|
|
|
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
Interest-bearing borrowings |
|
141,748 |
|
184,076 |
|
Deferred tax liabilities |
|
21,252 |
|
18,038 |
|
Contingent acquisition consideration |
|
7,792 |
|
13,005 |
|
Other payables |
|
1,075 |
|
- |
|
Deferred government grants |
|
- |
|
2,377 |
|
Employee benefits |
10 |
5,683 |
|
7,930 |
|
Derivative financial instruments |
|
115 |
|
804 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Non-current liabilities |
|
177,665 |
|
226,230 |
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Interest-bearing borrowings |
|
5,868 |
|
3,856 |
|
Trade and other payables |
|
358,666 |
|
257,691 |
|
Corporation tax payable |
|
9,949 |
|
5,772 |
|
Contingent acquisition consideration |
|
5,262 |
|
- |
|
Employee benefits |
|
2,856 |
|
12,703 |
|
Derivative financial instruments |
|
1,102 |
|
4,288 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Total current liabilities |
|
383,703 |
|
284,310 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL LIABILITIES |
|
561,368 |
|
510,540 |
|
|
|
|
|
|
|
|
|
|
|
|
|
TOTAL EQUITY AND LIABILITIES |
|
779,186 |
|
692,384 |
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated statement of changes in equity
for the year ended 31 July 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Foreign |
|
|
|
|
|
|
|
|
|
|
Capital |
|
Cashflow |
|
|
|
Share-based |
|
|
|
currency |
|
|
|
|
|
|
Share |
|
Share |
|
redemption |
|
hedge |
|
Revaluation |
|
payment |
|
Reorganisation |
|
translation |
|
Retained |
|
|
|
|
capital |
|
premium |
|
reserve |
|
reserve |
|
reserve |
|
reserve |
|
reserves |
|
reserve |
|
earnings |
|
Total |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 1 August 2010 |
1,386 |
|
160,399 |
|
- |
|
(4,002) |
|
34,701 |
|
2,748 |
|
(196,884) |
|
(17,033) |
|
200,529 |
|
181,844 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Result for the year |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
45,798 |
|
45,798 |
|
Other comprehensive income |
- |
|
- |
|
- |
|
2,786 |
|
- |
|
- |
|
- |
|
(958) |
|
(576) |
|
1,252 |
|
Share-based payments |
- |
|
- |
|
- |
|
- |
|
- |
|
917 |
|
- |
|
- |
|
- |
|
917 |
|
Redemption of deferred convertible shares |
(1) |
|
- |
|
1 |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(1) |
|
(1) |
|
Dividend paid to shareholders |
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
- |
|
(11,992) |
|
(11,992) |
|
Transfer of revaluation reserve to revenue reserve |
- |
|
- |
|
- |
|
- |
|
(17,960) |
|
- |
|
- |
|
- |
|
17,960 |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 July 2011 |
1,385 |
|
160,399 |
|
1 |
|
(1,216) |
|
16,741 |
|
3,665 |
|
(196,884) |
|
(17,991) |
|
251,718 |
|
217,818 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated statement of cash flows
for the year ended 31 July 2011
|
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
Cash flows from operating activities |
|
|
|
|
Profit before tax- continuing operations |
62,542 |
|
44,529 |
|
Profit before tax- discontinued operations |
4,815 |
|
13,770 |
|
Exceptional items |
3,709 |
|
- |
|
Finance income |
(6,106) |
|
(4,201) |
|
Finance expense |
16,616 |
|
19,414 |
|
Share of profit of associates and joint venture |
(14,857) |
|
(11,572) |
|
Depreciation of property, plant and equipment |
5,276 |
|
6,525 |
|
Amortisation of intangible assets |
4,295 |
|
3,914 |
|
Amortisation of government grants |
(56) |
|
(99) |
|
Employee share-based payment charge |
917 |
|
918 |
|
Pension contributions and payments in excess of service costs |
(11,874) |
|
(3,666) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating cash flow before changes in working capital |
65,277 |
|
69,532 |
|
(Increase)/decrease in inventory |
(33,383) |
|
15,191 |
|
(Increase)/decrease in trade and other receivables |
(47,036) |
|
22,008 |
|
Increase/(decrease) in trade and other payables |
78,116 |
|
(27,298) |
|
|
|
|
|
|
|
|
|
|
|
Cash generated from operating activities |
62,974 |
|
79,433 |
|
Interest paid |
(13,030) |
|
(13,529) |
|
Income tax paid |
(12,242) |
|
(7,851) |
|
|
|
|
|
|
|
|
|
|
|
Cash inflow from operating activities |
37,702 |
|
58,053 |
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Consolidated statement of cash flows -continued
for the year ended 31 July 2011
|
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Proceeds from sale of property, plant and equipment |
1,405 |
|
984 |
|
Purchase of property, plant and equipment |
(6,624) |
|
(5,975) |
|
Additions to intangible assets |
(3,001) |
|
(1,123) |
|
Acquisition of subsidiary undertakings |
(79,266) |
|
- |
|
Disposal of subsidiary undertakings |
74,639 |
|
- |
|
Investment/loans to associates and joint venture, net |
(419) |
|
(1,252) |
|
Dividends received from associates and joint venture |
7,002 |
|
5,807 |
|
|
|
|
|
|
|
|
|
|
|
Cash outflow from investing activities |
(6,264) |
|
(1,559) |
|
|
|
|
|
|
Cash flow from financing activities |
|
|
|
|
Redemption of share capital |
(1) |
|
- |
|
Repayment of bank loans |
(40,918) |
|
(51,079) |
|
Dividends paid to equity shareholders |
(11,992) |
|
(10,641) |
|
Increase/(decrease) in finance lease obligations |
78 |
|
(886) |
|
|
|
|
|
|
|
|
|
|
|
Cash outflow from financing activities |
(52,833) |
|
(62,606) |
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
(21,395) |
|
(6,112) |
|
|
|
|
|
|
Translation adjustment |
(1,103) |
|
(1,097) |
|
|
|
|
|
|
Cash and cash equivalents at start of year |
72,625 |
|
79,834 |
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents at end of year |
50,127 |
|
72,625 |
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement
for the year ended 31 July 2011
1 Basis of preparation
The financial information included on pages 11 to 35 of this preliminary results statement has been extracted from the Group financial statements for the year ended 31 July 2011 on which the auditor has issued an unqualified audit opinion.
The financial information has been prepared in accordance with the accounting policies set out in the Group's consolidated financial statements for the year ended 31 July 2011 which were prepared in accordance with International Financial Reporting Standards as adopted by the EU.
The consolidated financial information is presented in euro, rounded to the nearest thousand, which is the functional currency of the parent and majority of the Group's operations.
2 Segment information
IFRS 8, "Operating Segments" requires operating segments to be identified on the basis of internal reports that are regularly reviewed by the Chief Operating Decision Maker (CODM) in order to allocate resources to the segments and to assess their performance. Three operating segments have been identified; Agri-Services, Food and Associates and Joint Venture.
Origin's Agri-Services segment comprises integrated agronomy services and agri-inputs. The Food business is the owner of a number of Ireland's leading ambient food brands servicing the home-baking, food ingredients and convenience categories across the retail, food service and manufacturing sectors. During November 2010, Valeo Foods Group Limited ("Valeo Foods") was formed in which Origin held a 44.1 per cent interest. Valeo Foods acquired 100 per cent of the Food business from Origin as well as 100 per cent of the Irish food company Batchelors. Following the completion of the Valeo Foods transaction on 26 November 2010 the results for Food for the period from 1 August to 26 November 2010 are now classified as discontinued. Comparative figures have also been restated to reflect the effect of discontinued operations. The result for Food is included on the Associate and Joint Venture line effective 26 November 2010.
Origin Enterprises plc
Notes to the preliminary results statement -continued
for the year ended 31 July 2011
2 Segment information- continued
(i) Segment revenue and result
|
|
Agri-Services
|
|
Associates and joint venture |
|
Food- discontinued operations |
Total-Group |
|||||||||
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total revenue |
1,257,498 |
|
1,077,009 |
|
- |
|
- |
|
44,240 |
|
260,056 |
|
1,301,738 |
|
1,337,065 |
|
Less revenue from discontinued operations |
- |
|
- |
|
- |
|
- |
|
(44,240) |
|
(260,056) |
|
(44,240) |
|
(260,056) |
|
Revenue- continuing operations |
1,257,498 |
|
1,077,009 |
|
- |
|
- |
|
- |
|
- |
|
1,257,498 |
|
1,077,009 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit before amortisation of intangibles and exceptional items |
65,963 |
|
50,998 |
|
- |
|
- |
|
5,051 |
|
14,856 |
|
71,014 |
|
65,854 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Amortisation of intangible assets |
(4,059) |
|
(2,828) |
|
- |
|
- |
|
(236) |
|
(1,086) |
|
(4,295) |
|
(3,914) |
|
Less: Operating profit from discontinued operations |
- |
|
- |
|
- |
|
- |
|
(4,815) |
|
(13,770) |
|
(4,815) |
|
(13,770) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total operating profit before share of profit of associates and joint venture and exceptional items |
61,904 |
|
48,170 |
|
- |
|
- |
|
- |
|
- |
|
61,904 |
|
48,170 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share of profit of associates and joint venture |
- |
|
- |
|
14,857 |
|
11,572 |
|
- |
|
- |
|
14,857 |
|
11,572 |
|
Exceptional items |
(2,948) |
|
- |
|
(761) |
|
- |
|
- |
|
- |
|
(3,709) |
|
- |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating profit- continuing operations |
58,956 |
|
48,170 |
|
14,096 |
|
11,572 |
|
- |
|
- |
|
73,052 |
|
59,742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Included in total revenue are related party sales between the Food segment and subsidiaries of ARYZTA AG of €2,235,000 (2010: €6,756,000). Inter-segment transfers or transactions are entered into under the normal commercial terms and conditions available to unrelated third parties.
Origin Enterprises plc
Notes to the preliminary results statement -continued
for the year ended 31 July 2011
2 Segment information- continued
|
|
Agri-Services
|
|
Associates and joint venture |
|
Food- discontinued operations |
Total Group |
|||||||||
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets excluding investment in associates, joint venture and investment properties |
548,471 |
|
379,590 |
|
- |
|
- |
|
- |
|
125,906 |
|
548,471 |
|
505,496 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment in associates and joint venture (including other financial assets) |
- |
|
- |
|
154,094 |
|
89,741 |
|
- |
|
- |
|
154,094 |
|
89,741 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment assets |
548,471 |
|
379,590 |
|
154,094 |
|
89,741 |
|
- |
|
125,906 |
|
702,565 |
|
595,237 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation to total assets as reported in Statement of Financial Position |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
|
|
|
|
|
|
|
|
55,496 |
|
76,043 |
|
Investment properties |
|
|
|
|
|
|
|
|
|
|
|
|
16,002 |
|
16,002 |
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
|
|
|
|
311 |
|
495 |
|
Deferred tax assets |
|
|
|
|
|
|
|
|
|
|
|
|
4,812 |
|
4,607 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total assets as reported in Statement of Financial Position |
|
|
|
|
|
|
|
|
779,186 |
|
692,384 |
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(ii) Segment assets
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
2 Segment information -continued
(iii) Segment liabilities
|
|
Agri-Services
|
|
Associates and joint venture |
|
Food- discontinued operations |
Total- Group |
|||||||||
|
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment liabilities |
381,334 |
|
260,709 |
|
- |
|
- |
|
- |
|
32,997 |
|
381,334 |
|
293,706 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation to total liabilities as reported in Statement of Financial Position |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest bearing loans and liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
147,616 |
|
187,932 |
|
Derivative financial instruments |
|
|
|
|
|
|
|
|
|
|
|
|
1,217 |
|
5,092 |
|
Current and deferred tax liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
31,201 |
|
23,810 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total liabilities as reported in Statement of Financial Position |
|
|
|
|
|
|
|
|
|
561,368 |
|
510,540 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
3 Exceptional items
Exceptional items are those that, in management's judgement, should be disclosed by virtue of their nature or amount. Such items are included within the Income Statement caption to which they relate. The following exceptional items arose during the year;
|
|
2011 €'000 |
|
2010 €'000 |
|
|
|
|
|
|
Continuing operations |
|
|
|
|
Gain on disposal of operation (i) |
(3,168) |
|
- |
|
Acquisition costs (ii) |
1,378 |
|
- |
|
Arising in associates and joint venture (iii) |
761 |
|
- |
|
Loss on dilution of interest in associate (iv) |
4,738 |
|
- |
|
|
|
|
|
|
Total continuing operations before tax |
3,709
|
|
-
|
|
Tax on exceptional items |
625 |
|
- |
|
|
|
|
|
|
Total continuing operations after tax |
4,334 |
|
- |
|
|
|
|
|
|
Discontinued operations |
|
|
|
|
Loss on disposal of operation (v) |
7,301 |
|
- |
|
|
|
|
|
|
Total discontinued operations |
7,301 |
|
- |
|
Total exceptional items |
11,635 |
|
- |
(i) Gain on disposal of operations
During the year Origin reached agreement with W&R Barnett Limited ('Barnett') to establish an all Ireland grain and feed handling logistics and trading business. The all Ireland business was formed through the integration of the R&H Hall business in the Republic of Ireland, which formed part of the Agri-Services operating segment, and the business of Origin and Barnett in Northern Ireland. The transaction was completed on 28 January 2011. Under the terms of the transaction, Barnett acquired a 50% interest in R&H Hall mirroring the economic interests of Origin and Barnett in the Northern Ireland business. From 28 January 2011 this 50% holding is treated as an associate undertaking in accordance with IAS 28. Of the total gain on disposal, €1.6 million is attributable to recognising the investment retained in R&H Hall at its fair value at the date of disposal. The gain on the transaction arose as follows:
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
3 Exceptional items -continued
|
|
2011 |
|
|
€'000 |
|
Net assets transferred on 28 January 2011: |
|
|
Property, plant and equipment |
15,412 |
|
Working capital |
35,704 |
|
Deferred tax and government grants |
(2,667) |
|
|
|
|
|
48,449 |
|
|
|
|
Consideration received, net of transaction costs |
(40,562) |
|
Fair value of 50% equity interest in R&H Hall |
(11,055) |
|
|
|
|
|
|
|
Gain on disposal of operation |
(3,168) |
|
|
|
(ii) Acquisition costs
This consists of transaction costs arising on the three acquisitions during the year net of a provision for an indemnity no longer required.
(iii) Arising in associates and joint venture
The exceptional loss arising in associates and joint venture results primarily from the expensing of acquisition costs and gains recorded on property, plant and equipment.
(iv) Loss on dilution of interest in associate
On 23 June 2011, Continental Farmers Group plc ('CFG') raised €16.7 million upon its flotation on ESM and AIM markets of the Dublin and London Stock exchanges. As a result Origin's shareholding reduced from 38.7% to 24.2%. This gave rise to a loss of €4.7m on the dilution of the holding, which is recorded in the income statement as an exceptional loss for the year ended 31 July 2011.
(v) Loss on disposal of operation
On 10 September 2010, the Group reached an agreement with CapVest Limited ('CapVest') to establish Valeo Foods, to facilitate consolidation of Irish consumer food brands. On 28 November 2010, it was announced that Valeo Foods had completed the simultaneous acquisitions of the branded food businesses of Origin and the Irish food company Batchelors. The Group transferred its 100% shareholding in Origin Foods to Valeo Foods, in which the Group has a 44.1% shareholding. Net assets transferred to Valeo Foods were €83.3m. With effect from 26 November 2010, Origin's 44.1% shareholding in Valeo Foods has been treated as an associate undertaking and accounted for using the equity method in accordance with IAS 28. Of the total loss on disposal, €3.2 million is attributable to recognising the investment in Valeo Foods at its fair value at the date of disposal. The loss on this transaction arose as follows:
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
3 Exceptional items -continued
|
|
|
|
2011 |
|
|
|
|
€'000 |
|
Net assets transferred to Valeo Foods on 26 November 2010: |
|
|
|
|
Property, plant and equipment |
|
|
31,252 |
|
Intangible assets |
|
|
42,732 |
|
Working capital |
|
|
12,734 |
|
Deferred tax and government grants |
|
|
(3,429) |
|
|
|
|
|
|
|
|
|
83,289 |
|
Consideration |
|
|
|
|
- Cash received, net of transaction costs |
(25,340) |
|
|
|
- Fair Value of vendor loan note |
(33,540) |
|
|
|
- Fair value of 44.1% equity interest in Valeo Foods |
(17,108) |
|
(75,988) |
|
|
|
|
|
|
Loss on disposal of operation |
|
|
7,301 |
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
4 Discontinued operations
The Group disposed of its interest in Origin Food on 26 November 2010. These operations are considered, in management's judgement, to be discontinued in accordance with IFRS 5, "Non-Current Assets Held for Sale and Discontinued Operations". The respective loss on the disposal of this operating segment was recognised in the Group Income Statement within discontinued operations. The details of the profits to the date of disposal are set out in Note 2. Further details on the net assets of the businesses disposed of and consideration received are set out in Note 3.
The revenue, results and cash flows of the Group's discontinued operation were as follows;
|
|
*2011 €'000 |
|
2010 €'000 |
|
|
|
|
|
|
Revenue |
44,240 |
|
260,056 |
|
Expenses |
(39,189) |
|
(245,200) |
|
|
|
|
|
|
|
|
|
|
|
Operating profit before amortisation of intangibles |
5,051 |
|
14,856 |
|
Intangible amortisation |
(236) |
|
(1,086) |
|
|
|
|
|
|
Profit before tax |
4,815
|
|
13,770
|
|
Attributable income tax expense |
(620) |
|
(1,797) |
|
|
|
|
|
|
Profit after tax for the period |
4,195
|
|
11,973
|
|
|
|
|
|
|
Loss on disposal of operation |
(7,301) |
|
- |
|
|
|
|
|
|
(Loss)/profit for the year from discontinued operations |
(3,106) |
|
11,973 |
|
|
|
|
|
*Results of Origin Foods for the year from 1 August 2010 to 26 November 2010
.
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
4 Discontinued operations- continued
|
|
2011 €'000 |
|
2010 €'000 |
|
|
|
|
|
|
Profit before taxation |
4,815 |
|
13,770 |
|
Depreciation |
524 |
|
1,807 |
|
Amortisation of intangible assets |
236 |
|
1,086 |
|
Amortisation of government grants |
(4) |
|
(10) |
|
Pension contributions in excess of service costs |
- |
|
(155) |
|
Working capital movement |
(4,515) |
|
10,896 |
|
Cash generated from operating activities |
1,056
|
|
27,394
|
|
Interest paid |
- |
|
(801) |
|
Income tax paid |
(433) |
|
(999) |
|
Net cash inflow from operating activities |
623
|
|
25,594
|
|
|
|
|
|
|
Cashflows from investing activities |
|
|
|
|
Purchase of property, plant and equipment |
- |
|
(1,177) |
|
Net cash outflow from investing activities |
-
|
|
(1,177)
|
|
|
|
|
|
|
Cashflows from financing activities |
|
|
|
|
Net cash movement with Origin Group including dividends |
(2,991) |
|
(27,417) |
|
Net cash outflow from financing activities |
(2,991)
|
|
(27,417)
|
|
|
|
|
|
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
(2,368) |
|
(3,000) |
|
Cash and cash equivalents at start of year |
2,610 |
|
5,610 |
|
Cash and cash equivalents at disposal |
242
|
|
2,610
|
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
5 Earnings per share
The calculation of basic earnings per share for the year ended 31 July 2011 was based on the profit for the financial year attributable to ordinary shareholders of €45,798,000 (2010: €48,039,000) and the weighted average number of ordinary shares in issue.
|
|
2011 €'000 |
|
2010 €'000 |
|
Profit/(loss) for the financial year attributable to equity shareholders |
|
|
|
|
- Continuing operations |
48,904 |
|
36,066 |
|
- Discontinued operations |
(3,106) |
|
11,973 |
|
Total profit for financial year attributable to equity shareholders |
45,798 |
|
48,039 |
|
|
|
|
|
|
|
'000 |
|
'000 |
|
Weighted average number of ordinary shares for the year |
133,016 |
|
133,016 |
|
|
|
|
|
|
|
Cent |
|
Cent |
|
Basic earnings/(loss) per share |
|
|
|
|
- Continuing operations |
36.77 |
|
27.12 |
|
- Discontinued operations |
(2.34) |
|
9.00 |
|
Total basic earnings per share |
34.43 |
|
36.12 |
Diluted earnings per share
The calculation of diluted earnings per share at 31 July 2011 was based on the profit for the financial year attributable to ordinary shareholders of €45,798,000 (2010: €48,039,000) and the weighted average number of ordinary shares outstanding of 138,416,000 (2010: 137,377,000).
|
|
2011 €'000 |
|
2010 €'000 |
|
Profit/(loss) for the financial year attributable to equity shareholders |
|
|
|
|
- Continuing operations |
48,904 |
|
36,066 |
|
- Discontinued operations |
(3,106) |
|
11,973 |
|
Total profit for financial year attributable to equity shareholders |
45,798 |
|
48,039 |
|
|
|
|
|
|
|
'000 |
|
'000 |
|
|
|
|
|
|
Weighted average number of ordinary shares used in basic calculation |
133,016 |
|
133,016 |
|
Effect of convertible shares with a dilutive effect |
5,400 |
|
4,361 |
|
Weighted average number of ordinary shares (diluted) for the year |
138,416 |
|
137,377 |
|
|
|
|
|
|
|
Cent |
|
Cent |
|
Diluted earnings/(loss) per share |
|
|
|
|
- Continuing operations |
35.33 |
|
26.25 |
|
- Discontinued operations |
(2.24) |
|
8.72 |
|
Total diluted earnings per share |
33.09 |
|
34.97
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
5 Earnings per share- continued
|
|
2011 '000 |
|
2010 '000 |
|
|
|
|
|
|
Adjusted basic earnings per share |
|
|
|
|
Weighted average number of ordinary shares (basic) |
133,016 |
|
133,016 |
|
|
2011
€'000 |
|
2011 Per share € cent |
|
2010
€'000 |
|
2010 Per share € cent |
|
|
|
|
|
|
|
|
|
|
Profit for the financial year - continuing operations |
48,904 |
|
36.77 |
|
36,066 |
|
27.12 |
|
|
|
|
|
|
|
|
|
|
Adjustments - continuing operations: |
|
|
|
|
|
|
|
|
Amortisation of acquisition related intangible assets |
3,988 |
|
2.99 |
|
2,828 |
|
2.12 |
|
Amortisation of related deferred tax |
(1,634) |
|
(1.23) |
|
(679) |
|
(0.51) |
|
Exceptional items, net of tax |
4,334
|
|
3.26 |
|
- |
|
- |
|
Adjusted basic earnings per share - continuing operations |
55,592 |
|
41.79 |
|
38,215 |
|
28.73 |
|
|
|
|
|
|
|
|
|
|
(Loss)/profit for the financial year - discontinued operations |
(3,106) |
|
(2.34) |
|
11,973 |
|
9.00 |
|
|
|
|
|
|
|
|
|
|
Adjustments - discontinued operations: |
|
|
|
|
|
|
|
|
Amortisation of acquisition related intangible assets |
236 |
|
0.18 |
|
1,086 |
|
0.82 |
|
Amortisation of related deferred tax |
(29) |
|
(0.02) |
|
(88) |
|
(0.07) |
|
Exceptional items, net of tax |
7,301 |
|
5.49 |
|
- |
|
- |
|
Adjusted basic earnings per share - discontinued operations |
4,402 |
|
3.31 |
|
12,971 |
|
9.75 |
|
|
|
|
|
|
|
|
|
|
Total adjusted basic earnings per share |
59,994 |
|
45.10 |
|
51,186 |
|
38.48 |
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
5 Earnings per share- continued
|
|
2011 '000 |
|
2010 '000 |
|
|
|
|
|
|
Adjusted diluted earnings per share |
|
|
|
|
Weighted average number of ordinary shares used in basic calculation |
133,016 |
|
133,016 |
|
Effect of convertible shares with a dilutive effect |
5,400 |
|
4,361 |
|
Weighted average number of ordinary shares (diluted) for the year |
138,416 |
|
137,377 |
|
|
2011
€'000 |
|
2011 Per share € cent |
|
2010
€'000 |
|
2010 Per share € cent |
|
|
|
|
|
|
|
|
|
|
Profit for the financial year - continuing operations |
48,904 |
|
35.33 |
|
36,066 |
|
26.25 |
|
|
|
|
|
|
|
|
|
|
Adjustments - continuing operations: |
|
|
|
|
|
|
|
|
Amortisation of acquisition related intangible assets |
3,988 |
|
2.88 |
|
2,828 |
|
2.06 |
|
Amortisation of related deferred tax |
(1,634) |
|
(1.18) |
|
(679) |
|
(0.49) |
|
Exceptional items, net of tax |
4,334 |
|
3.13 |
|
- |
|
- |
|
Adjusted diluted earnings per share - continuing operations |
55,592 |
|
40.16 |
|
38,215 |
|
27.82 |
|
|
|
|
|
|
|
|
|
|
(Loss)/profit for the financial year - discontinued operations |
(3,106) |
|
(2.24) |
|
11,973 |
|
8.72 |
|
|
|
|
|
|
|
|
|
|
Adjustments - discontinued operations: |
|
|
|
|
|
|
|
|
Amortisation of acquisition related intangible assets |
236 |
|
0.17 |
|
1,086 |
|
0.79 |
|
Amortisation of related deferred tax |
(29) |
|
(0.02) |
|
(88) |
|
(0.07) |
|
Exceptional items, net of tax |
7,301 |
|
5.27 |
|
- |
|
- |
|
Adjusted diluted earnings per share - discontinued operations |
4,402 |
|
3.18 |
|
12,971 |
|
9.44 |
|
|
|
|
|
|
|
|
|
|
Total adjusted diluted earnings per share |
59,994 |
|
43.34 |
|
51,186 |
|
37.26 |
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
6 Property, plant and equipment
|
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
At 1 August |
129,182 |
|
86,760 |
|
Additions |
6,425 |
|
6,169 |
|
Arising on acquisition |
12,733 |
|
- |
|
Arising on disposal of subsidiary undertakings (note 3) |
(46,664) |
|
- |
|
Transfer from investment properties |
- |
|
43,212 |
|
Disposals |
(937) |
|
(925) |
|
Depreciation charge |
(5,276) |
|
(6,525) |
|
Translation adjustments |
(1,207) |
|
491 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 July |
94,256 |
|
129,182 |
|
|
|
|
|
|
|
|
|
|
7 Goodwill and intangibles
|
|
2011 |
|
2010 |
|
|
€'000 |
|
€'000 |
|
|
|
|
|
|
At 1 August |
114,595 |
|
115,999 |
|
Arising on acquisition- goodwill |
26,548 |
|
- |
|
Arising on acquisition- other intangibles |
37,844 |
|
- |
|
Arising on disposal of subsidiary undertakings (note 3) |
(42,732) |
|
- |
|
Additions |
3,001 |
|
1,222 |
|
Amortisation |
(4,295) |
|
(3,914) |
|
Disposals |
(447) |
|
- |
|
Translation adjustments |
(4,008) |
|
1,288 |
|
|
|
|
|
|
|
|
|
|
|
At 31 July |
130,506 |
|
114,595 |
|
|
|
|
|
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
8 Investments in associates and joint venture
|
|
2011 €'000 |
|
2010 €'000 |
|
|
|
|
|
|
At 1 August |
89,741 |
|
83,631 |
|
Share of profits after tax |
14,857 |
|
11,572 |
|
Share of exceptional items |
(761) |
|
- |
|
Dividends received |
(7,002) |
|
(5,807) |
|
Investment in Valeo Foods and R&H Hall (note 3) |
28,163 |
|
- |
|
Investment in CFG (i) |
1,100 |
|
538 |
|
Loss on dilution of investment in CFG (i) |
(-4,738) |
|
- |
|
Loans/interest to associates |
(889) |
|
714 |
|
Arising on acquisition |
232 |
|
- |
|
Actuarial loss on associate's defined benefit pension scheme, net of deferred tax |
(490) |
|
(701) |
|
Share of other comprehensive income |
563 |
|
(692) |
|
Translation adjustment |
(1,695) |
|
486 |
|
|
|
|
|
|
At 31 July |
119,081 |
|
89,741
|
(i) On 23 June 2011, CFG raised €16.7 million upon its flotation on the Dublin and London Stock exchanges. As a result Origin's shareholding reduced from 38.7% to 24.2%. This gave rise to a loss of €4.7 million on the dilution of the holding, which is recorded in the income statement as an exceptional loss for the year ended 31 July 2011. The Groups' holding in CFG has a fair value at the balance sheet date of €13.1 million compared to its carrying amount of €15.9 million. As a result the Group tested the carrying value of the investment for impairment. As the recoverable amount exceeded the carrying amount of the investment, no impairment losses were recognised in the current financial year.
9 Other financial assets
|
|
2011 €'000 |
|
2010 €'000 |
|
At 1 August |
- |
|
- |
|
Fair value of vendor loan note (note 3) |
33,540 |
|
- |
|
Interest receivable |
1,473 |
|
- |
|
|
|
|
|
|
At 31 July |
35,013 |
|
- |
|
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
10 Retirement benefit obligations
The Group operates a number of defined benefit pension schemes and defined contribution schemes with assets held in separate trustee administered funds. All of the defined benefit schemes are closed to new members.
During the prior year the Group undertook a strategic review of its Irish defined benefit pension arrangements. Benefit changes were implemented and in the case of the Origin scheme the Group ceased its liability to contribute to the scheme with effect from 16 December 2010 and agreed to increase the transfer values payable from the plan on wind up to one hundred percent of the transfer values under the Minimum Funding Standard (MFS) excluding any allowance for pension increases. These proposed payments were shown as a liability at 31 July 2010 and €9,847,000 has been paid during the current financial year. The impact of the changes was to significantly reduce the pension liabilities in the Statement of Financial Position and the related volatility.
Employee benefits included in the Consolidated Statement of Financial Position comprises the following:
|
|
2011 €'000 |
|
2010 €'000 |
|
|
|
|
|
|
Deficit in defined benefit schemes |
5,257 |
|
7,498 |
|
Provision to meet unfunded pensions |
426 |
|
432 |
|
Total |
|
|
|
|
|
5,683 |
|
7,930 |
|
|
|
|
|
Movement in net liability recognised in the Consolidated Statement of Financial Position
|
|
2011 |
|
2010 |
|
||
|
|
€'000 |
|
€'000 |
|
||
|
|
|
|
|
|
||
|
Net liability in schemes at 1August |
(7,498) |
|
(23,053) |
|
||
|
Current service cost |
(430) |
|
(800) |
|
||
|
Employer contributions |
2,457 |
|
4,466 |
|
||
|
Acquisitions |
444 |
|
- |
|
||
|
Other finance expense |
(191) |
|
(661) |
|
||
|
Actuarial gain/(loss) |
221 |
|
(509) |
|
||
|
Settlement and curtailment (losses)/gains |
(191) |
|
13,002 |
|
||
|
Translation adjustments |
(69) |
|
57 |
|
||
|
|
|
|
|
|
||
|
|
|
|
|
|
||
|
At 31 July |
(5,257) |
|
(7,498) |
|
||
|
|
|
|
|
|||
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
11 Acquisition of subsidiary undertakings
During the year the Group completed a number of acquisitions in the United Kingdom:
1. On 8 March 2011, the Group completed the acquisition of 100% of United Agri Products Limited ("UAP"). UAP is a premier provider of agronomy services to arable, fruit and vegetable growers.
2. On 9 March 2011, the Group acquired 100% of Rigby Taylor Limited ("Rigby Taylor"). Rigby Taylor is a leading service provider supplying advice and technical product solutions to the professional sports turf, landscape and amenity sectors.
3. On 13 July 2011, the Group acquired 100% of Origin Fertilisers 2011 Limited from Carrs Milling Industries PLC ("Carrs Milling"). Origin Fertilisers 2011 Limited is a leading provider of branded specialist fertilisers together with integrated nutrient management systems servicing the arable, grassland, horticulture and forestry sectors.
As a result of the above acquisitions, the Group has built upon its core positions in the supply of specialist agronomy services and crop nutrition ingredients. Details of the net assets acquired and goodwill arising from the business combinations are as follows;
|
|
|
Fair value €'000 |
|
Net assets acquired: |
|
|
|
Property, plant and equipment (note 6) |
|
12,733 |
|
Intangible assets (note 7) |
|
37,844 |
|
Investments in associates (note 8) |
|
232 |
|
Inventory |
|
30,791 |
|
Trade and other receivables (net of impairment) |
|
36,975 |
|
Trade and other payables |
|
(58,232) |
|
Finance leases |
|
(402) |
|
Deferred tax |
|
(7,930) |
|
Employee benefit (note 10) |
|
444 |
|
Corporation tax |
|
(734) |
|
|
|
|
|
|
|
51,721 |
|
Net assets acquired |
|
|
|
Goodwill arising on acquisition (note 7) |
|
26,548 |
|
|
|
|
|
|
|
|
|
Consideration |
|
78,269 |
|
|
|
|
|
Satisfied by: |
|
|
|
|
|
|
|
Cash consideration (excluding acquisition expenses) |
|
94,608 |
|
Cash acquired |
|
(17,419) |
|
|
|
|
|
Net cash consideration |
|
77,189 |
|
Contingent consideration |
|
1,080 |
|
|
|
|
|
|
|
|
|
Consideration |
|
78,269 |
|
|
|
|
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
11 Acquisition of subsidiary undertakings- continued
Post acquisition revenues and net profit after tax relating to these acquisitions amounted to €109.3 million and €8.0 million, respectively. If the acquisitions had occurred on 1 August 2010, management estimates that consolidated revenue from continuing operations would have been €1.4 billion and consolidated operating profit for the period from continuing operations would have been €75.7 million. In determining these amounts management has assumed that the fair value adjustments that arose on that dates of acquisition would have been the same if the acquisition occurred on 1 August 2010.
|
12 |
Analysis of net debt |
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||
|
|
|
|
|
|
|
Non-cash |
|
Acquisitions/ |
|
Translation |
|
|
|||
|
|
|
2010 |
|
Cashflow |
|
movements |
|
disposals |
|
Adjustment |
|
2011 |
|||
|
|
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|
€'000 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Cash |
76,043 |
|
(19,396) |
|
- |
|
- |
|
(1,151) |
|
55,496 |
|||
|
|
Overdraft |
(3,418) |
|
(1,999) |
|
- |
|
- |
|
48 |
|
(5,369) |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Cash and cash equivalents |
72,625 |
|
(21,395) |
|
- |
|
- |
|
(1,103) |
|
50,127 |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Finance lease obligations |
(820) |
|
(78) |
|
- |
|
(360) |
|
40 |
|
(1,218) |
|||
|
|
Loans |
(183,694) |
|
40,918 |
|
(742) |
|
- |
|
2,489 |
|
(141,029) |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
|
|
Net debt |
(111,889) |
|
19,445 |
|
(742) |
|
(360) |
|
1,426 |
|
(92,120) |
|||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||
13 Dividend
The Board is recommending a dividend of 11 cent per ordinary share (2010: 9 cent per ordinary share). Subject to shareholders' approval at the Annual General Meeting, the dividend will be paid on 6 January 2012 to shareholders on the register on 16 December 2011. In accordance with IFRS this dividend has not been provided for in the Statement of Financial Position as at 31 July 2011.
14 Related party transactions
Related party transactions occurring in the year were similar in nature to those described in the 2010 Annual Report.
Origin Enterprises plc
Notes to the preliminary results statement- continued
for the year ended 31 July 2011
15 Subsequent events
On 8 August 2011, Origin's associate undertaking, Valeo Foods, announced that it had reached conditional agreement to acquire Jacob Fruitfield Food Group Limited ('Jacob Fruitfield'). Under the terms of the transaction Valeo Foods is to acquire 100 per cent of Jacob Fruitfield to be funded by a combination of cash, vendor loan note and new equity in Valeo Foods. After subscribing €7.9 million for additional equity in Valeo Foods, Origin will have a reduced 32 per cent shareholding in the enlarged entity.
This information is provided by RNS
Latest directors dealings
- 3 hours ago ASOS
- 4 hours ago MJ Gleeson
- 4 hours ago Rolls-Royce Holdings
- 4 hours ago Crest Nicholson Holdings
- 5 hours ago Naked Wines