Final Results - Operating Profit Up 15%
Greencore Group PLC
29 November 1999
PRELIMINARY STATEMENT OF RESULTS
FOR THE YEAR ENDED 24 SEPTEMBER 1999
FINANCIAL HIGHLIGHTS
YEAR ENDED 24 SEPTEMBER 1999
* TURNOVER UP BY 15% TO EURO862 MILLION
(IR£679 MILLION)
* OPERATING PROFIT UP BY 15% TO EURO82.6 MILLION
(IR£65 MILLION)
* HEADLINE EARNINGS PER SHARE UP BY 6% TO EURO34.5C
(IR27.2P)
* FINAL DIVIDED UP BY 10% TO EURO7.87C (IR6.2P)
* TOTAL DIVIDEND UP BY 10% TO EURO11.87C (IR9.35P)
CHAIRMAN'S STATEMENT
YEAR ENDED 24 SEPTEMBER 1999
RESULTS
I AM PLEASED TO REPORT THAT THE GROUP ACHIEVED GROWTH IN
OPERATING PROFITS IN EACH OF ITS BUSINESS SECTORS IN THE YEAR
ENDED 24 SEPTEMBER 1999.
GROUP SALES INCREASED BY 15% TO EURO862M (IR£679M) WHILE
OPERATING PROFIT, BEFORE GOODWILL AMORTISATION AND EXCEPTIONAL
ITEM, INCREASED BY 14% TO EURO81.9M (IR£64.5M). OPERATING
PROFIT, AFTER EXCEPTIONAL ITEM AND GOODWILL AMORTISATION OF
SUBSIDIARIES, INCREASED BY 15% TO EURO82.6M (IR£65M). OUR SHARE
OF PROFITS FROM ASSOCIATED UNDERTAKINGS, NET OF SHARE OF INTEREST
PAYABLE BUT BEFORE GOODWILL AND EXCEPTIONAL ITEM, WAS EURO4.3M
(IR£3.4M) (1998: EURO6.7M (IR£5.2M)). NET INTEREST PAYABLE
INCREASED FROM EURO4.5M (IR£3.5M) TO EURO11.4M (IR£9M) AS A
RESULT OF ACQUISITION EXPENDITURE, PRINCIPALLY ON
PAULS MALT AND PARAMOUNT FOODS. PROFIT BEFORE TAXATION AND
EXCEPTIONAL ITEMS INCREASED FROM EURO73.9M (IR£58.2M) TO
EURO74.3M (IR£58.5M). TAXATION AMOUNTED TO EURO6.9M (IR£5.5M)
(1998: EURO10.8M (IR£8.5M)).
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION INCREASED BY 5% FROM
EURO63.1M (IR£49.7M) TO EURO66.1M (IR£52.1M). HEADLINE EARNINGS
PER SHARE INCREASED BY 6% TO EURO34.5C (IR27.2P) AND BASIC
EARNINGS PER SHARE INCREASED BY 4% TO EURO34C (IR26.8P). AN
INCREASE IN THE FINAL DIVIDEND OF 10% TO EURO7.87C (IR6.2P) IS
PROPOSED (1998: EURO7.17C (5.65P)) MAKING A TOTAL DIVIDEND FOR
THE YEAR OF EURO11.87C (IR9.35P), AN INCREASE OF 10% ON THE 1998
TOTAL DIVIDEND.
REVIEW OF OPERATIONS
SUGAR
SALES INCREASED BY 4% TO EURO193M (IR£152M) WHILE OPERATING
PROFIT ALSO INCREASED BY 4% TO EURO36.5M (IR£28.8M).
GOOD GROWTH IN IRISH INDUSTRIAL VOLUMES, AIDED BY A MODEST CARRY
OVER OF QUOTA SALES FROM THE PREVIOUS YEAR, WAS ACHIEVED. THE
IMPROVEMENT IN PROFITS WAS A NOTEWORTHY ACHIEVEMENT IN THE
CONTEXT OF THE ADVERSE IMPACT OF THE FINAL GREEN POUND RELATED
PRICE REDUCTION OF SUGAR FOLLOWING THE INTRODUCTION OF THE EURO
ON 1 JANUARY 1999, TOGETHER WITH ADDITIONAL LEVIES IMPOSED ON ALL
EUROPEAN SUGAR COMPANIES IN RESPECT OF THE 1998/99 MARKETING
YEAR. PROFITS BENEFITED FROM THE CONTINUING IMPROVEMENTS IN
EFFICIENCY, AIDED BY OUR CAPITAL EXPENDITURE PROGRAMME, AND
STRONG DEMAND FOR BEET PULP BY-PRODUCTS FOR THE ANIMAL FEED
INDUSTRY.
FOOD AND INGREDIENTS
SALES INCREASED BY 25% TO EURO521M (IR£411M) WHILE OPERATING
PROFIT INCREASED BY 27% TO EURO36M (IR£28.4M). THE RESULTS
INCLUDED FULL YEAR CONTRIBUTIONS FROM PARAMOUNT FOODS AND PAULS
MALT WHICH WERE ACQUIRED IN THE PREVIOUS YEAR. PARAMOUNT
CONTINUED TO EXPERIENCE STRONG GROWTH IN BOTH ITS PIZZA AND WET
SAUCES BUSINESSES WITH ITS ORGANIC PRODUCTS ACHIEVING EXCEPTIONAL
GROWTH. WORLD MALT MARKETS REMAINED DIFFICULT THROUGHOUT THE YEAR
WITH THE TIGHTER MARGINS BEING PARTIALLY OFFSET BY VOLUME
IMPROVEMENTS IN IRELAND AND SIGNIFICANT COST REDUCTIONS IN PAULS
MALT IN THE U.K. THE STRENGTH OF STERLING HAS BEEN AN ADVERSE
FACTOR IN THE SIGNIFICANT EXPORT BUSINESS OF PAULS AND PARAMOUNT.
VOLUME GROWTH IN OUR BREAD AND BAKED GOODS OPERATIONS CONTINUED
TO BE STRONG AND DURING THE YEAR KEARS ACQUIRED THE SPECIALIST
FAST GROWING MORNING GOODS BUSINESS OF BELLAMYS FOR EURO10M
(IR£8M). THE BELLAMY PRODUCT RANGE OF PANCAKES, CRUMPETS AND
OTHER MORNING GOODS COMPLEMENTS KEARS EXISTING SPECIALITY
PRODUCTS. ADDITIONALLY, THE 50% MINORITY INTEREST IN ROBERTSONS
BAKERY IN CARLISLE WAS ACQUIRED BY KEARS IN AUGUST 1999. STRONG
GROWTH IN OATMEAL, INGREDIENT AND FLOUR MIX SALES WAS A
SIGNIFICANT CONTRIBUTOR TO THE IMPROVEMENT IN PROFITABILITY AT
ODLUMS. OUR OTHER FOOD AND INGREDIENT BUSINESSES ALSO CONTINUED
TO TRADE SUCCESSFULLY.
AGRIBUSINESS
OPERATING PROFIT INCREASED BY 14% TO EURO9.4M (IR£7.4M) ON SALES
1% DOWN AT EURO148M (IR£117M). GOOD GROWTH IN VOLUMES WAS
ACHIEVED IN BOTH FERTILISERS AND MOLASSES. OUR IRISH
AGRICHEMICALS BUSINESS, WHICH IS THE LEADING PLAYER IN THE
REPUBLIC OF IRELAND, BENEFITED IN THE SECOND HALF OF THE YEAR
FROM THE ACQUISITION OF CLARENDON WHICH HAS A SIMILAR LEADING
POSITION IN THE NORTHERN IRELAND MARKET. THE ACQUISITION OFFERS
GOOD SCOPE FOR SYNERGIES. OPERATING PROFIT FROM OUR GRAIN
ASSEMBLY BUSINESS DECLINED AS A RESULT OF THE POOR 1998 CEREAL
HARVEST. EMPHASIS CONTINUES TO BE PLACED ON IMPROVEMENT IN RETURN
ON CAPITAL WHICH WAS AGAIN ACHIEVED.
ASSOCIATES
SHARE OF PROFIT OF ASSOCIATES, NET OF INTEREST PAYABLE BUT BEFORE
EXCEPTIONAL ITEM, DECLINED FROM EURO6.7M (IR£5.2M) TO EURO4.3M
(IR£3.4M). THIS RESULTED ENTIRELY FROM A REDUCTION IN
CONTRIBUTION FROM IMPERIAL SUGAR WHOSE POOR RESULTS WERE
SERIOUSLY HIT BY THE IMPACT OF ADVERSE WEATHER CONDITIONS
TOGETHER WITH INTEGRATION COSTS FOLLOWING FROM ITS RECENT
ACQUISITIONS. THERE WAS AN EXCEPTIONAL COST OF EURO2.2M (IR£1.7M)
IN RELATION TO OUR SHARE OF IMPERIAL SUGAR'S NON-CASH CHARGE ON
THE DISPOSAL OF ITS MINORITY INTEREST IN A U.S. SUGAR BEET
REFINERY. OUR OTHER ASSOCIATES TRADED SATISFACTORILY.
FINANCE
INTEREST COST, EXCLUDING SHARE OF ASSOCIATES' INTEREST, INCREASED
BY EURO6.9M (IR£5.5M) TO EURO11.4M (IR£9M) AS A RESULT OF A FULL
YEAR IMPACT OF THE 1998 ACQUISITION SPEND, PRINCIPALLY PAULS AND
PARAMOUNT, TOGETHER WITH DEFERRED CONSIDERATION RELATING TO PAULS
OF EURO65M (IR£51M) AND 1998/99 ACQUISITION EXPENDITURE TOTALLING
EURO18M (IR£14M). YEAR-END NET BORROWING INCREASED FROM EURO70M
(IR£55M) TO EURO151M (IR£119M). CAPITAL EXPENDITURE FOR THE YEAR
TOTALLED EURO41M (IR£32M) WITH THE INCREASE IN EXPENDITURE OVER
LAST YEAR'S FIGURE OF EURO28M (IR£22M) BEING MAINLY IN THE FOOD
SECTOR TO ENHANCE OUR CAPACITY TO MEET INCREASED DEMAND IN BREAD,
BAKED GOODS, PIZZA AND WET SAUCES. DEPRECIATION AMOUNTED TO
EURO27M (IR£21M) (1998: EURO23M (IR£18M)). THE TAX CHARGE FOR THE
YEAR OF EURO6.9M (IR£5.5M) (1998: EURO10.8M (IR£8.5M)) WAS NET
OF TAX RELIEF OF EURO0.8M (IR£0.6M) ON THE ASSOCIATES'
EXCEPTIONAL COST. THE REDUCTION IN THE PERCENTAGE TAX CHARGE
RESULTED FROM A LOWER MIX OF TAXABLE PROFITS FROM HIGHER-TAXED
GEOGRAPHIES. TOTAL DIVIDENDS OF EURO22.2M (IR£17.5M) WERE
COVERED 2.9 TIMES BY ATTRIBUTABLE PROFIT (1998: 3.1 TIMES).
CURRENT TRADING AND OUTLOOK
THE CURRENT IRISH SUGAR BEET PROCESSING CAMPAIGN IS PROGRESSING
WELL. SUGAR CONTENT AND QUALITY ARE SATISFACTORY AND YIELDS ARE
UP ON THE PRIOR YEAR. A TOTAL SUGAR TONNAGE IN EXCESS OF OUR
QUOTA OF 200,200 TONNES IS, THEREFORE, ANTICIPATED. PRODUCTION
EFFICIENCIES CONTINUED TO BE OBTAINED FROM OUR CAPITAL
EXPENDITURE PROGRAMME AND A SATISFACTORY RESULT FOR THE CAMPAIGN
AS A WHOLE IS ANTICIPATED. THE ELEMENT OF VOLATILITY IN THE
PRICING OF SUGAR RESULTING FROM THE GREEN POUND PRICE MECHANISM
HAS NOW BEEN ELIMINATED AS A RESULT OF IRELAND'S ENTRY INTO
EUROPEAN MONETARY UNION.
THE BUSINESSES WITHIN THE FOOD SECTOR CONTINUE TO TRADE WELL. OUR
MALTING GROUP IS THE FIFTH LARGEST IN THE WORLD AND HAS BEEN
OPERATING IN MALT MARKETS WHICH HAVE BEEN DIFFICULT FOR A COUPLE
OF YEARS, PRINCIPALLY AS A RESULT OF THE SLOW DOWN IN ASIAN
MARKETS AND ADDITIONAL MALTING CAPACITY THAT CAME ON STREAM IN
1997 AND 1998. MUCH OF THE IMPACT OF THESE ADVERSE CONDITIONS HAS
BEEN NEUTRALISED BY SIGNIFICANT IMPROVEMENTS IN PRODUCTIVITY AND
COST REDUCTION, PARTICULARLY IN PAULS MALT. THERE HAVE BEEN SOME
EARLY INDICATIONS OF AN IMPROVEMENT IN MARKET PROSPECTS IN SOME
EXPORT MARKETS. DEMAND IN OUR BREAD, BAKED GOODS, PIZZA AND WET
SAUCES BUSINESSES CONTINUES TO BE VERY STRONG AND THEIR RESULTS
AND SERVICE LEVELS WILL BENEFIT FROM ADDITIONAL CAPACITY IN THE
CURRENT AND FUTURE YEARS. OUR OTHER INGREDIENT AND CONSUMER FOODS
BUSINESSES ALSO ANTICIPATE FURTHER PROGRESS ALTHOUGH RETAIL
MARKETS REMAIN VERY COMPETITIVE.
IN THE AGRIBUSINESS SECTOR, VOLUMES AND QUALITY FROM THE 1999
CEREAL HARVEST WERE GOOD AND FURTHER STEADY PROGRESS IS
ANTICIPATED. IN FERTILISERS, A MAJOR COST REDUCTION PROGRAMME TO
INCREASE COMPETITIVENESS IS CURRENTLY BEING IMPLEMENTED.
GREENCORE'S CORPORATE STRATEGY IS TO GENERATE SUSTAINED EARNINGS
PERFORMANCE THROUGH OPTIMISING RETURNS FROM ITS STRONG, HIGH-
QUALITY, CASH-GENERATIVE PRIMARY BUSINESSES, EXPLOITING THE
ORGANIC GROWTH POTENTIAL OF ITS FOOD INGREDIENTS AND CONSUMER
FOODS BUSINESSES AND THROUGH THE ACQUISITION OF BUSINESSES WHICH,
WHEN COMBINED WITH GREENCORE'S EXISTING OPERATIONS AND FOCUSED
AND AMBITIOUS MANAGEMENT, HAVE THE CAPABILITY TO DEVELOP STRONG
MARKET POSITIONS IN THEIR SECTORS.
OUR STRONG CASHFLOW, TRADING AND MARKET POSITIONS GIVE US AN
EXCELLENT BASE FOR FURTHER PROGRESS. WE CONTINUE TO FOCUS ON
IMPROVING OUR COMPETITIVENESS IN TERMS OF COST, QUALITY, SERVICE,
PRODUCT AND MARKET DEVELOPMENT AND A NUMBER OF INITIATIVES IN
THESE AREAS ARE PLANNED.
WE CONTINUE TO ACTIVELY SEEK OUT OPPORTUNITIES FOR ACQUISITION
AND DEVELOPMENT, PARTICULARLY IN THE FOOD AND INGREDIENTS SECTOR.
WE BELIEVE THAT THERE IS SIGNIFICANT OPPORTUNITY AVAILABLE TODAY
IN THE GENERALLY UNDER-RATED FOOD SECTOR AND WE ARE DETERMINED
TO EXPLOIT THIS OPPORTUNITY TO MOVE OUR BUSINESS FORWARD. TRADING
IN THE CURRENT YEAR HAS BEEN IN LINE WITH OUR EXPECTATIONS.
I WOULD AGAIN LIKE TO THANK ALL OUR EMPLOYEES FOR THEIR EFFORTS
DURING THE YEAR IN A DEMANDING AND CHANGING ENVIRONMENT AND FOR
THEIR CONTRIBUTION TO THE CONTINUING GROWTH OF THE GROUP.
B.M. CAHILL,
CHAIRMAN.
29 NOVEMBER, 1999
CONSOLIDATED PROFIT AND LOSS ACCOUNT
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
NOTES EURO'000 EURO'000
TURNOVER 1 862,399 751,750
COST OF SALES 667,707 577,192
------- -------
GROSS PROFIT 194,692 174,558
NET OPERATING COSTS 112,749 102,856
------- -------
OPERATING PROFIT BEFORE GOODWILL
AMORTISATION AND EXCEPTIONAL ITEMS 1 81,943 71,702
GOODWILL AMORTISATION (267) -
EXCEPTIONAL ITEM 2 917 -
------- -------
OPERATING PROFIT 82,593 71,702
SHARE OF OPERATING PROFIT
OF ASSOCIATED UNDERTAKINGS
BEFORE GOODWILL AND EXCEPTIONAL
ITEMS 12,347 13,733
GOODWILL AMORTISATION OF ASSOCIATES (283) -
------- -------
SHARE OF OPERATING PROFIT OF
ASSOCIATED UNDERTAKINGS 12,064 13,733
SHARE OF EXCEPTIONAL ITEM -
ASSOCIATES 2 (2,201) -
------- -------
PROFIT ON ORDINARY ACTIVITIES
BEFORE INTEREST 92,456 85,435
INTEREST RECEIVABLE AND SIMILAR
INCOME 3,292 3,210
INTEREST PAYABLE AND SIMILAR CHARGES (14,705) (7,677)
SHARE OF INTEREST PAYABLE - ASSOCIATES (8,003) (7,070)
------- -------
PROFIT ON ORDINARY ACTIVITIES BEFORE
TAXATION 73,040 73,898
TAXATION ON PROFIT ON ORDINARY
ACTIVITIES 6,929 10,761
------- -------
PROFIT ON ORDINARY ACTIVITIES AFTER
TAXATION 66,111 63,137
MINORITY INTERESTS 2,576 1,568
------- -------
PROFIT ATTRIBUTABLE TO GROUP
SHAREHOLDERS 63,535 61,569
DIVIDENDS 3 22,178 20,163
------- -------
RETAINED PROFIT 41,357 41,406
------- -------
EARNINGS PER ORDINARY SHARE 4
BASIC 34.0C 32.6C
HEADLINE 34.5C 32.6C
FULLY DILUTED
BASIC 33.9C 32.5C
HEADLINE 34.4C 32.5C
CONSOLIDATED BALANCE SHEET
AT 24 SEPTEMBER 1999
1999 1998
EURO'000 EURO'000
FIXED ASSETS
TANGIBLE ASSETS 356,666 331,414
INTANGIBLE ASSETS 14,248 -
FINANCIAL ASSETS 24,426 18,310
------- -------
395,340 349,724
------- -------
CURRENT ASSETS
STOCKS 163,523 151,386
DEBTORS 137,087 131,456
CASH AND BANK BALANCES 116,140 93,883
------- -------
416,750 376,725
CREDITORS
AMOUNTS FALLING DUE WITHIN ONE YEAR 231,827 309,962
------- -------
NET CURRENT ASSETS 184,923 66,763
------- -------
TOTAL ASSETS LESS CURRENT LIABILITIES 580,263 416,487
------- -------
CREDITORS: AMOUNTS FALLING DUE AFTER
MORE THAN ONE YEAR 252,268 131,033
PROVISIONS FOR LIABILITIES AND CHARGES 35,147 18,877
DEVELOPMENT GRANTS 2,368 2,644
------- -------
289,783 152,554
------- -------
NET ASSETS 290,480 263,933
------- -------
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL 121,718 121,696
SHARE PREMIUM ACCOUNT 84,262 84,194
PROFIT AND LOSS ACCOUNT 79,692 53,290
------- -------
SHAREHOLDERS' FUNDS - EQUITY INTERESTS 285,672 259,180
MINORITY INTERESTS - EQUITY INTERESTS 4,808 4,753
------- -------
290,480 263,933
------- -------
CONSOLIDATED CASH FLOW STATEMENT
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
EURO'000 EURO'000
OPERATING ACTIVITIES
OPERATING PROFIT 81,943 71,702
NON CASH ITEMS
- DEPRECIATION (NET OF GRANTS) 26,854 22,914
- OTHER (3,648) 2,614
CHANGES IN WORKING CAPITAL (9,292) 14,926
-------- -------
CASH FLOW FROM OPERATING ACTIVITIES 95,857 112,156
DIVIDENDS FROM ASSOCIATES 1,771 5,235
RETURNS ON INVESTMENTS AND SERVICING OF FINANCE (12,061) (6,245)
TAXATION (7,288) (7,874)
CAPITAL EXPENDITURE (NET) (31,596) (28,029)
ACQUISITION OF SUBSIDIARY AND ASSOCIATED
UNDERTAKINGS (82,958) (69,834)
NET CASH (OVERDRAFT) ACQUIRED 333 (1,944)
EQUITY DIVIDENDS PAID (20,871) (19,159)
------- -------
CASH OUTFLOW BEFORE USE OF
LIQUID RESOURCES AND FINANCING (56,813) (15,694)
MANAGEMENT OF LIQUID RESOURCES (21,085) (17,127)
FINANCING 75,496 32,131
------- -------
DECEASE IN CASH IN THE PERIOD (2,402) (690)
------- -------
DECEASE IN CASH IN THE PERIOD (2,402) (690)
CASH FLOW FROM INCREASE IN DEBT AND LEASE
FINANCING (75,405) (55,686)
CASH FLOW FROM INCREASE IN LIQUID RESOURCES 21,085 17,127
------- -------
CHANGE IN NET DEBT RESULTING FROM CASH FLOWS (56,722) (39,249)
LOANS AND FINANCE LEASES ACQUIRED WITH
SUBISIDIARIES (1,063) (7,324)
NEW FINANCE LEASES (33) (124)
LOAN NOTES ISSUED ON ACQUISITION (8,445) -
TRANSLATION DIFFERENCES (14,579) (1,389)
------- -------
MOVEMENT IN NET DEBT IN PERIOD (80,842) (40,086)
NET DEBT AT 26 SEPTEMBER 1998 (70,328) (22,242)
------- -------
NET DEBT AT 24 SEPTEMBER 1999 (151,170) (70,328)
======== --------
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
EURO'OOO EURO'000
PROFIT FOR YEAR ATTRIBUTABLE TO GROUP
SHAREHOLDERS 63,535 61,569
EXCHANGE ADJUSTMENTS (2,636) 400
------- -------
TOTAL RECOGNISED GAINS FOR THE YEAR 60,899 61,969
------- -------
THE AUDITORS HAVE CONFIRMED THAT THEY WILL BE ISSUING AN UNQUALIFIED
OPINION ON THE ACCOUNTS FROM WHICH THE FINANCIAL INFORMATION SET OUT
ON PAGES 4 TO 9 FOR THE YEAR ENDED 24 SEPTEMBER 1999 HAS BEEN
EXTRACTED. THE FINANCIAL INFORMATION FOR THE YEAR ENDED 25
SEPTEMBER 1998 HAS BEEN EXTRACTED FROM AUDITED ACCOUNTS ON WHICH
THE AUDITORS ISSUED AN UNQUALIFIED OPINION AND WHICH HAVE BEEN
DELIVERED TO THE REGISTRAR OF COMPANIES.
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
1. ANALYSIS OF TURNOVER OPERATING NET TURNOVER OPERATING NET
RESULTS PROFIT ASSETS PROFIT ASSETS
EURO'000 EURO'000 EURO'000 EURO'000 EURO'000 EURO'000
BY ACTIVITY
SUGAR 193,227 36,518 117,203 186,540 35,007 110,865
FOOD AND
INGREDIENTS 521,258 36,000 256,510 415,697 28,429 163,827
AGRIBUSINESS 147,914 9,425 45,325 149,513 8,266 43,069
------- ------ ------- ------- ------- -------
862,399 81,943 419,038 751,750 71,702 317,761
------- ------ ------- -------
ASSOCIATED
UNDERTAKINGS 353,143 12,347 22,612 370,794 13,733 16,500
LESS GROUP
NET
BORROWINGS (151,170) (70,328)
--------- --------
NET ASSETS 290,480 263,933
========= --------
BY GEOGRAPHICAL
MARKET
RESULTS BY ORIGIN
REPUBLIC OF
IRELAND 478,679 62,291 350,314 474,483 56,515 285,673
UNITED KINGDOM
AND REST OF THE
WORLD 383,720 19,652 68,724 277,267 15,187 32,088
------- ------ ------- ------- ------- -------
862,399 81,943 419,038 751,750 71,702 317,761
ASSOCIATED ------- ------ ------- -------
UNDERTAKINGS 353,143 12,347 22,612 370,794 13,733 16,500
LESS GROUP
NET
BORROWINGS (151,170) (70,328)
--------- --------
NET ASSETS 290,480 263,933
========= --------
TURNOVER BY
DESTINATION
REPUBLIC OF
IRELAND 426,513 421,173
UNITED
KINGDOM AND
AND REST OF
THE WORLD 435,886 330,577
------- --------
862,399 751,750
------- -------
2. THE EXCEPTIONAL CREDIT OF EURO0.917M RELATES TO THE PARTIAL
ANNULMENT OF AN EU FINE IMPOSED ON IRISH SUGAR. THE SHARE
OF EXCEPTIONAL ITEM IN ASSOCIATES RELATES TO THE
DISPOSAL OF IMPERIAL SUGAR'S 43% LIMITED PARTNERSHIP
INTEREST IN PACIFIC NORTHWEST SUGAR COMPANY, A U.S. SUGAR
BEET REFINERY.
3. THE PROPOSED FINAL DIVIDEND OF EURO7.87C PER SHARE (1998:
EURO7.17C) IS PAYABLE ON 14 FEBRUARY 2000 TO SHAREHOLDERS
ON THE REGISTER OF MEMBERS AS AT 10 DECEMBER 1999. AN
INTERIM DIVIDEND OF EURO4.00C (1998: EURO3.62C) WAS PAID IN
JULY 1999. IRELAND HAS RECENTLY INTRODUCED A WITHHOLDING TAX
ON DIVIDENDS AT A RATE OF 24% APPLICABLE TO ALL DIVIDENDS PAID
BY AN IRISH RESIDENT COMPANY ON OR AFTER 6 APRIL, 1999.
CERTAIN CLASSES OF SHAREHOLDERS QUALIFY FOR EXEMPTION AND
DETAILS WILL BE CIRCULATED TO SHAREHOLDERS BEFORE THE DIVIDEND
PAYMENT DATE.
4. THE CALCULATION OF EARNINGS PER SHARE IS BASED ON EARNINGS
OF EURO63.54M (1998: EURO61.57M) AND ON 186.8 MILLION ORDINARY
SHARES (1998: 188.3 MILLION) BEING THE WEIGHTED AVERAGE NUMBER
OF ORDINARY SHARES IN ISSUE DURING THE PERIOD. THE CALCULATION
OF HEADLINE EARNINGS IN 1999 IS AFTER ELIMINATION OF THE SHARE
OF EXCEPTIONAL CHARGE IN ASSOCIATES OF EURO1.431M (AFTER TAX
RELIEF OF EURO0.770M), GOODWILL AMORTISATION OF EURO550,000
AND THE EXCEPTIONAL CREDIT OF EURO0.917M (TAX CHARGE NIL). THE
CALCULATION OF EARNINGS PER SHARE EXCLUDES 4.9M TREASURY
SHARES ARISING FROM THE SHARE REPURCHASE PROGRAMME.
5. THE FOREGOING ACCOUNTS ARE PREPARED ON THE BASIS OF THE
ACCOUNTING POLICIES SET OUT IN THE 1998 ANNUAL REPORT, EXCEPT
THAT THE FOLLOWING SIX ACCOUNTING STANDARDS HAVE BEEN ADOPTED
FOR THE FIRST TIME: FRS10 - 'GOODWILL AND INTANGIBLE ASSETS';
FRS11 - 'IMPAIRMENT OF FIXED ASSETS AND GOODWILL'; FRS12 -
'PROVISIONS, CONTINGENT LIABILITIES AND CONTINGENT ASSETS';
FRS13 - 'DERIVATIVES AND OTHER FINANCIAL INSTRUMENTS:
DISCLOSURES'; FRS14 - 'EARNINGS PER SHARE' AND FRS15 -
'TANGIBLE FIXED ASSETS'.
6. THE GROUP'S APPROACH TO RESOLVING THE ISSUES ARISING OUT OF
YEAR 2000 WAS DESCRIBED IN THE 1998 ANNUAL REPORT. PROGRESS
TO-DATE IS IN LINE WITH THE MILESTONES AND OBJECTIVES SET IN
THE IMPLEMENTATION PLANS TO MAKE I.T. AND OTHER SYSTEMS YEAR
2000 COMPLIANT AND THE PROJECT HAS NOW BEEN SUBSTANTIALLY
COMPLETED. THE YEAR 2000 ISSUE HAS NO PRECEDENT, WITH
CONSEQUENT UNCERTAINTIES AS TO THE SCALE OF THE PROBLEM,
PARTICULARLY EXTERNAL TO THE GROUP. THE GROUP CONTINUES TO
MAKE EVERY EFFORT TO AVOID THE POSSIBILITY OF BUSINESS
DISRUPTION, INCLUDING THE DEVELOPMENT OF APPROPRIATE
CONTINGENCY PLANS. OUR ESTIMATE OF THE TOTAL REVENUE COST,
EXCLUSIVE OF INTERNAL COST AND THOSE IN RELATION TO HARDWARE
AND SOFTWARE ALREADY PLANNED FOR OTHER REASONS, REMAINS AT THE
FORECAST LEVEL OF EURO1.7M SET OUT IN THE 1998 ANNUAL REPORT.
7. THE PRELIMINARY STATEMENT IS BEING SENT TO ALL REGISTERED
SHAREHOLDERS. COPIES ARE ALSO AVAILABLE FROM THE COMPANY'S
REGISTERED OFFICE AT ST. STEPHEN'S GREEN HOUSE, EARLSFORT
TERRACE, DUBLIN 2 AND FROM THE REGISTRATION DEPARTMENT, BANK
OF IRELAND, HUME HOUSE, BALLSBRIDGE, DUBLIN 4. THE ANNUAL
REPORT AND ACCOUNTS WILL BE CIRCULATED TO SHAREHOLDERS IN
JANUARY 2000 PRIOR TO THE ANNUAL GENERAL MEETING TO BE HELD
ON 10 FEBRUARY 2000 IN THE BERKELEY COURT HOTEL, BALLSBRIDGE,
DUBLIN 4.
BY ORDER OF THE BOARD, B.J. POWER, COMPANY SECRETARY, 29
NOVEMBER 1999.
GREENCORE GROUP PLC, ST. STEPHEN'S GREEN HOUSE, EARLSFORT
TERRACE, DUBLIN 2.
CONSOLIDATED PROFIT AND LOSS ACCOUNT
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
NOTES IR£'000 IR£'000
TURNOVER 8 679,194 592,051
COST OF SALES 525,862 454,576
------- -------
GROSS PROFIT 153,332 137,475
NET OPERATING COSTS 88,797 81,005
------- -------
OPERATING PROFIT BEFORE GOODWILL
AMORTISATION AND EXCEPTIONAL ITEMS 8 64,535 56,470
GOODWILL AMORTISATION (210) -
EXCEPTIONAL ITEM 9 722 -
------- -------
OPERATING PROFIT 65,047 56,470
SHARE OF OPERATING PROFIT
OF ASSOCIATED UNDERTAKINGS
BEFORE GOODWILL AND EXCEPTIONAL
ITEMS 9,724 10,816
GOODWILL AMORTISATION OF ASSOCIATES (223) -
------- -------
SHARE OF OPERATING PROFIT OF
ASSOCIATED UNDERTAKINGS 9,501 10,816
SHARE OF EXCEPTIONAL ITEM -
ASSOCIATES 9 (1,734) -
------- -------
PROFIT ON ORDINARY ACTIVITIES
BEFORE INTEREST 72,814 67,286
INTEREST RECEIVABLE AND SIMILAR
INCOME 2,593 2,528
INTEREST PAYABLE AND SIMILAR CHARGES (11,581) (6,046)
SHARE OF INTEREST PAYABLE - ASSOCIATES (6,303) (5,568)
------- -------
PROFIT ON ORDINARY ACTIVITIES BEFORE
TAXATION 57,523 58,200
TAXATION ON PROFIT ON ORDINARY
ACTIVITIES 5,457 8,475
------- -------
PROFIT ON ORDINARY ACTIVITIES AFTER
TAXATION 52,066 49,725
MINORITY INTERESTS 2,029 1,235
------- -------
PROFIT ATTRIBUTABLE TO GROUP
SHAREHOLDERS 50,037 48,490
DIVIDENDS 10 17,467 15,880
------- -------
RETAINED PROFIT 32,570 32,610
======= -------
EARNINGS PER ORDINARY SHARE 11
BASIC 26.8P 25.7P
HEADLINE 27.2P 25.7P
FULLY DILUTED
BASIC 26.7P 25.6P
HEADLINE 27.1P 25.6P
CONSOLIDATED BALANCE SHEET
AT 24 SEPTEMBER 1999
1999 1998
IR£'000 IR£'000
FIXED ASSETS
TANGIBLE ASSETS 280,897 261,010
INTANGIBLE ASSETS 11,221 -
FINANCIAL ASSETS 19,237 14,420
------- -------
311,355 275,430
------- -------
CURRENT ASSETS
STOCKS 128,783 119,226
DEBTORS 107,965 103,530
CASH AND BANK BALANCES 91,468 73,939
------- -------
328,216 296,695
CREDITORS
AMOUNTS FALLING DUE WITHIN ONE YEAR 182,576 244,115
------- -------
NET CURRENT ASSETS 145,640 52,580
------- -------
TOTAL ASSETS LESS CURRENT LIABILITIES 456,995 328,010
------- -------
CREDITORS: AMOUNTS FALLING DUE AFTER
MORE THAN ONE YEAR 198,677 103,197
PROVISIONS FOR LIABILITIES AND CHARGES 27,681 14,867
DEVELOPMENT GRANTS 1,865 2,082
------- -------
228,223 120,146
------- -------
NET ASSETS 228,772 207,864
======= -------
CAPITAL AND RESERVES
CALLED UP SHARE CAPITAL 95,861 95,843
SHARE PREMIUM ACCOUNT 66,362 66,308
PROFIT AND LOSS ACCOUNT 62,762 41,970
------- -------
SHAREHOLDERS' FUNDS - EQUITY INTERESTS 224,985 204,121
MINORITY INTERESTS - EQUITY INTERESTS 3,787 3,743
------- -------
228,772 207,864
======= -------
CONSOLIDATED CASH FLOW STATEMENT
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
IR£'000 IR£'000
OPERATING ACTIVITIES
OPERATING PROFIT 64,535 56,470
NON CASH ITEMS
- DEPRECIATION (NET OF GRANTS) 21,149 18,046
- OTHER (2,873) 2,059
CHANGES IN WORKING CAPITAL (7,318) 11,755
-------- -------
CASH FLOW FROM OPERATING ACTIVITIES 75,493 88,330
DIVIDENDS FROM ASSOCIATES 1,395 4,123
RETURNS ON INVESTMENTS AND SERVICING OF FIANNCE (9,499) (4,918)
TAXATION (5,739) (6,201)
CAPITAL EXPENDITURE (NET) (24,884) (21,994)
ACQUISITION OF SUBSIDIARY AND ASSOCIATED
UNDERTAKINGS (65,335) (55,079)
NET CASH (OVERDRAFT) ACQUIRED 262 (1,531)
EQUITY DIVIDENDS PAID (16,437) (15,089)
------- -------
CASH OUTFLOW BEFORE USE OF
LIQUID RESOURCES AND FINANCING (44,744) (12,359)
MANAGEMENT OF LIQUID RESOURCES (16,606) (13,489)
FINANCING 59,458 25,305
------- -------
DECEASE IN CASH IN THE PERIOD (1,892) (543)
------- -------
DECEASE IN CASH IN THE PERIOD (1,892) (543)
CASH FLOW FROM INCREASE IN DEBT AND LEASE
FINANCING (59,386) (43,856)
CASH FLOW FROM INCREASE IN LIQUID RESOURCES 16,606 13,489
------- -------
CHANGE IN NET DEBT RESULTING FROM CASH FLOWS (44,672) (30,910)
LOANS AND FINANCE LEASES ACQUIRED WITH
SUBISIDIARIES (837) (5,768)
NEW FINANCE LEASES (26) (98)
LOAN NOTES ISSUED ON ACQUISITION (6,651) -
TRANSLATION DIFFERENCES (11,482) (1,094)
------- -------
MOVEMENT IN NET DEBT IN PERIOD (63,668) (37,870)
NET DEBT AT 26 SEPTEMBER 1998 (55,387) (17,517)
------- -------
NET DEBT AT 24 SEPTEMBER 1999 (119,055) (55,387)
======== --------
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
IR£'OOO IR£'000
PROFIT FOR YEAR ATTRIBUTABLE TO GROUP
SHAREHOLDERS 50,037 48,490
EXCHANGE ADJUSTMENTS (2,076) 315
------- -------
TOTAL RECOGNISED GAINS AND LOSSES FOR THE YEAR 47,961 48,805
------- -------
NOTES TO THE FINANCIAL STATEMENTS
YEAR ENDED 24 SEPTEMBER 1999
1999 1998
8. ANALYSIS OF TURNOVER OPERATING NET TURNOVER OPERATING NET
RESULTS PROFIT ASSETS PROFIT ASSETS
IR£'000 IR£'000 IR£'000 IR£'000 IR£'000 IR£'000
BY ACTIVITY
SUGAR 152,178 28,760 92,305 146,912 27,570 87,313
FOOD AND
INGREDIENTS 410,524 28,352 202,018 327,388 22,390 129,024
AGRIBUSINESS 116,492 7,423 35,696 117,751 6,510 33,919
------- ------ ------- ------- ------- -------
679,194 64,535 330,019 592,051 56,470 250,256
ASSOCIATED ------- ------ ------- -------
UNDERTAKINGS 278,123 9,724 17,808 292,024 10,816 12,995
LESS GROUP
NET
BORROWINGS (119,055) (55,387)
--------- --------
NET ASSETS 228,772 207,864
========= --------
BY GEOGRAPHICAL
MARKET
RESULTS BY ORIGIN
REPUBLIC OF
IRELAND 376,990 49,058 275,894 373,686 44,509 224,986
UNITED KINGDOM
AND REST OF THE
WORLD 302,204 15,477 54,125 218,365 11,961 25,270
------- ------ ------- ------- ------- -------
679,194 64,535 330,019 592,051 56,470 250,256
ASSOCIATED ------- ------ ------- -------
UNDERTAKINGS 278,123 9,724 17,808 292,024 10,816 12,995
LESS GROUP
NET
BORROWINGS (119,055) (55,387)
--------- --------
NET ASSETS 228,772 207,864
========= --------
TURNOVER BY
DESTINATION
REPUBLIC OF
IRELAND 335,906 331,701
UNITED
KINGDOM AND
AND REST OF
THE WORLD 343,288 260,350
------- --------
679,194 592,051
======= -------
9. THE EXCEPTIONAL CREDIT OF IR£0.722M RELATES TO THE PARTIAL ANNULMENT
OF AN EU FINE IMPOSED ON IRISH SUGAR. THE SHARE OF EXCEPTIONAL ITEM
IN ASSOCIATES RELATES TO THE DISPOSAL OF IMPERIAL SUGAR'S 43% LIMITED
PARTNERSHIP INTEREST IN PACIFIC NORTHWEST SUGAR COMPANY, A U.S. SUGAR
BEET REFINERY.
10. THE PROPOSED FINAL DIVIDEND OF IR6.2P PER SHARE (1998: IR5.65P) IS
PAYABLE ON 14 FEBRUARY 2000 TO SHAREHOLDERS ON THE REGISTER OF MEMBERS
AS AT 10 DECEMBER 1999. AN INTERIM DIVIDEND OF IR3.15P (1998: IR2.85P)
WAS PAID IN JULY 1999. IRELAND HAS RECENTLY INTRODUCED A WITHHOLDING
TAX ON DIVIDENDS AT A RATE OF 24% APPLICABLE TO ALL DIVIDENDS PAID BY
AN IRISH RESIDENT COMPANY ON OR AFTER 6 APRIL, 1999. CERTAIN CLASSES
OF SHAREHOLDERS QUALIFY FOR EXEMPTION AND DETAILS WILL BE CIRCULATED
TO SHAREHOLDERS BEFORE THE DIVIDEND PAYMENT DATE.
11. THE CALCULATION OF EARNINGS PER SHARE IS BASED ON EARNINGS OF IR£50.04M
(1998: IR£48.49M) AND ON 186.8 MILLION ORDINARY SHARES (1998: 188.3
MILLION) BEING THE WEIGHTED AVERAGE NUMBER OF ORDINARY SHARES IN ISSUE
DURING THE PERIOD. THE CALCULATION OF HEADLINE EARNINGS IN 1999 IS
AFTER ELIMINATION OF THE SHARE OF EXCEPTIONAL CHARGE IN ASSOCIATES OF
IR£1.127M (AFTER TAX RELIEF OF IR£0.607M), GOODWILL AMORTISATION OF
IR£433,000 AND THE EXCEPTIONAL CREDIT OF IR£0.722 MILLION (TAX CHARGE
NIL). THE CALCULATION OF EARNINGS PER SHARE EXCLUDES 4.9M TREASURY
SHARES ARISING FROM THE SHARE REPURCHASE PROGRAMME.
12. THE FOREGOING ACCOUNTS ARE PREPARED ON THE BASIS OF THE ACCOUNTING
POLICIES SET OUT IN THE 1998 ANNUAL REPORT, EXCEPT THAT THE FOLLOWING
SIX ACCOUNTING STANDARDS HAVE BEEN ADOPTED FOR THE FIRST TIME: FRS10 -
'GOODWILL AND INTANGIBLE ASSETS'; FRS11 - 'IMPAIRMENT OF FIXED ASSETS
AND GOODWILL'; FRS12 - 'PROVISIONS, CONTINGENT LIABILITIES AND
CONTINGENT ASSETS'; FRS13 - 'DERIVATIVES AND OTHER FINANCIAL
INSTRUMENTS: DISCLOSURES'; FRS14 - 'EARNINGS PER SHARE' AND FRS15 -
'TANGIBLE FIXED ASSETS'.
13. THE GROUP'S APPROACH TO RESOLVING THE ISSUES ARISING OUT OF YEAR 2000
WAS DESCRIBED IN THE 1998 ANNUAL REPORT. PROGRESS TO-DATE IS IN LINE
WITH THE MILESTONES AND OBJECTIVES SET IN THE IMPLEMENTATION PLANS TO
MAKE I.T. AND OTHER SYSTEMS YEAR 2000 COMPLIANT AND THE PROJECT HAS NOW
BEEN SUBSTANTIALLY COMPLETED. THE YEAR 2000 ISSUE HAS NO PRECEDENT,
WITH CONSEQUENT UNCERTAINTIES AS TO THE SCALE OF THE PROBLEM,
PARTICULARLY EXTERNAL TO THE GROUP. THE GROUP CONTINUES TO MAKE EVERY
EFFORT TO AVOID THE POSSIBILITY OF BUSINESS DISRUPTION, INCLUDING THE
DEVELOPMENT OF APPROPRIATE CONTINGENCY PLANS. OUR ESTIMATE OF THE TOTAL
REVENUE COST, EXCLUSIVE OF INTERNAL COST AND THOSE IN RELATION TO
HARDWARE AND SOFTWARE ALREADY PLANNED FOR OTHER REASONS, REMAINS AT THE
FORECAST LEVEL OF IR£1.3M SET OUT IN THE 1998 ANNUAL REPORT.
GREENCORE GROUP PLC
ST. STEPHEN'S GREEN HOUSE, EARLSFORT TERRACE, DUBLIN 2.
TELEPHONE: 353 1 605 1000. FAX 353 1 605 1100
WWW.GREENCORE.IE
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