Final Results for the year ended
31 March 2014
The Board of Directors of National Breweries Plc, in compliance with the re...
BALANCE SHEET AS AT 31 MARCH
2014 2013
K'000 K'000
ASSETS EMPLOYED
Property, plant and equipment 124,171 74,010
Current as...
STATEMENT OF CASHFLOWS
2014 2013
K'000 K'000
Cash flows from operating activities
Cash generated from operations 80,734 65...
Financial Review
National Breweries Plc. recorded a profit after tax of K46.4 million for the year, 42% up on
prior year.
...
Strategic Review and Prospects
The stability in the regulatory environment has been supportive of business growth in the
y...
management skills. The two companies also partnered in supporting the training in
business skills of 300 women entrepreneu...
Copies of the press release are available from the registered office:
National Breweries Plc.
P.O Box 35135
Plot 6438 Mung...
NATIONAL BREWERIES PLC
Final Dividend
At a Board Meeting held on 14th
May 2014, the Board resolved not to recommend a
divi...
of 8

Natbrew FY2014 financial results

Natbrew FY2014 financial results
Published on: Mar 3, 2016
Published in: Investor Relations      Business      Economy & Finance      
Source: www.slideshare.net


Transcripts - Natbrew FY2014 financial results

  • 1. Final Results for the year ended 31 March 2014 The Board of Directors of National Breweries Plc, in compliance with the requirements of the Securities Act No.38 of 1993 and the Listing Requirements of the Lusaka Stock Exchange is pleased to announce the unaudited results of the company for the year ended 31 March 2014. INCOME STATEMENT YEAR ENDED 31 MARCH 2014 2013 % K'000 K'000 Change Volumes (Hls’000) 2,179 2,321 (6%) Net Producers Revenue 393,618 337,470 17% Gross Profit 136,575 106,850 28% Profit from ordinary activities before exchange losses, interest and taxation 73,403 53,370 38% Operating exchange loss (354) (772) (54%) Operating profit 73,049 52,598 39% Finance income/( costs) 538 (217) (348%) Profit before tax 73,587 52,381 40% Income tax (27,166) (19,924) 36% Profit after tax 46,421 32,457 43% Earnings per share (Kwacha) 0.74 0.52 42%
  • 2. BALANCE SHEET AS AT 31 MARCH 2014 2013 K'000 K'000 ASSETS EMPLOYED Property, plant and equipment 124,171 74,010 Current assets 103,204 60,498 Total assets 227,375 134,508 EQUITY & LIABILITIES Shareholders funds 106,824 59,794 Non-current liabilities 16,673 11,111 Current liabilities 103,878 63,603 Total equity and liabilities 227,375 134,508
  • 3. STATEMENT OF CASHFLOWS 2014 2013 K'000 K'000 Cash flows from operating activities Cash generated from operations 80,734 65,328 Interest received 3,100 429 Interest paid (on financing of operations) (196) (479) Income tax paid (10,044) (22,400) Net cash generated from operating activities 73,593 42,878 Cash flows from investing activities Purchase of property, plant and equipment (62,786) (38,739) Proceeds from sale of property, plant and equipment 2,137 1,798 Purchase of intangible asset (971) (1,479) Net cash used in investing activities (61,620) (38,420) Cash flows from financing activities Interest paid (on long term borrowings) - - Dividends paid to shareholders - (898) Net cash generated from financing activities - (898) Net increase in cash and cash equivalents 11,973 3,560 Movement in cash and cash equivalents Cash, cash equivalents and bank overdrafts at the beginning of the year 12,959 9,137 Increase in cash and cash equivalents 11,973 3,560 Exchange differences in cash and cash equivalents 734 262 Cash and Cash Equivalents at the end of the year 25,666 12,959
  • 4. Financial Review National Breweries Plc. recorded a profit after tax of K46.4 million for the year, 42% up on prior year. We continued to operate in a highly competitive market and unfortunately saw volume performance for Chibuku drop 6% below prior year. This was primarily due to production outages in Kitwe and an increase in price on our Chibuku Shake Shake product which led to a softening of demand in the last two quarters of the year. The reduction in disposable income of our consumers, as a result of the removal of maize and fuel subsidies earlier in the year, contributed to them purchasing cheaper priced products. Encouragingly, however, revenues increased 17% on prior year due to a 16.6% price increase in Chibuku Shake Shake in August and a better product mix towards Chibuku Super sales, offsetting the impact of the 6% drop in volumes. Chibuku Super sales accounted for a total of 16% (F13- 4%) of the total Chibuku sales in the year, demonstrating an improved product mix towards our premium product. Similarly Gross Margin grew by 28% on prior year, reflecting this positive mix. Despite the numerous challenges to the business over the year, including increased competition from bulk beer, the business grew operating profit by 39%, reflecting the improved gross margin performance and tight cost controls. The effective tax rate was 37% for the year, in line with expectations. National Breweries Plc. contributed a total of K99.7 million in tax for the financial year, comprising Corporate, Excise, VAT, employee and other taxes. Earnings per share increased by 42% to K0.74 per share. We commenced our investment in the Lusaka Brewery rebuild and Chibuku Super packaging line in this financial year. A total of K165 million has been committed to the new facility which we expect to be complete in the second half of 2014. This will be financed from cash and intergroup financing.
  • 5. Strategic Review and Prospects The stability in the regulatory environment has been supportive of business growth in the year. The only major external shocks to the opaque beer market came from the removal of subsidies on fuel and maize. This affected our business in two ways: firstly, it resulted in increased distribution and input costs and, secondly, it reduced the disposable income of our consumers. These combined factors impacted our volume performance, profit margin and profitability. The volume performance of our premium Chibuku Super PET category has, however, continued to see significant growth owing to the availability and the longer shelf-life of the product. This strong performance affirms our strategic plan to invest in a new and bigger production facility at our existing site in Lusaka at a cost of K165 million. The new brewery will double our annual total Chibuku production from Lusaka to 2.1 million hectolitres from the current 1 million. The increased inputs that will be required in our production process will thus motivate further growth of our value chains. Market distortion caused by the selective and ineffective implementation of SI No. 72 of 2012 (The Liquor Licensing (Intoxicating Liquor) (Quantities and Packaging) (Amendment) Regulation, 2012) continued to be a challenge. In as much as bulk beer is banned under this piece of legislation, it has continued to be available in the market to the detriment of compliant producers. Sustainable Development In line with the approach of SABMiller subsidiaries around the world, National Breweries Plc. in the last financial year continued to implement socio-economic programmes that were aimed at reducing poverty in the communities where we operate through the creation of shared value among stakeholders. In this regard, the company implemented a number of programmes in line with the SABMiller Ten Priorities One Future Sustainable Development Plan. Opportunities through Enterprise We continued to support entrepreneurial development in line with our 6th Sustainable Development Priority “Enterprise Development”. The company collaborated with Zambian Breweries Plc. in conducting a 5-day workshop to train 100 youths in basic business
  • 6. management skills. The two companies also partnered in supporting the training in business skills of 300 women entrepreneurs operating under the Zambia Federation of Women in Business (ZFAWIB). Benefitting communities National Breweries has continued to believe in the ethos of good „corporate citizenship‟ as a basis for the sustainable success of our business . It is for this reason that the company, together with Zambian Breweries Plc., partnered with the Ministry of Health through the National Malaria Control Centre (NMCC) and donated 1,000 Insecticide Treated Mosquito Nets to Nyimba District as part of our continued interventions in Zambia‟s health sector. This donation at Kalingindi rural health post was targeted primarily at pregnant women and children under the age of five who a particularly susceptible to malaria. Alcohol responsibility As part of SABMiller‟s global commitment to promote responsible alcohol consumption, National Breweries and Zambian Breweries entered into a multi-million Kwacha partnership with the Road Transport and Safety Agency (RTSA), which among other things, is helping with enforcement of existing legislation on drinking and driving as well as with operational costs of the agency including the buying of equipment such as breathalysers. Under the partnership, 25 members of staff from SABMiller‟s Zambia subsidiaries were trained as RTSA Traffic Inspectors. The aims of the partnership are: 1. To create increased public awareness on road safety; 2. To create increased public awareness on the dangers of Drunk Driving 3. To encourage enforcement of the Road Safety laws, including imposition of corresponding sanctions that not only punish but also serve as a deterrent to offenders. Initially implemented in Lusaka, it is our expectation that we will soon extend this programme with RTSA to other main centres in the country.
  • 7. Copies of the press release are available from the registered office: National Breweries Plc. P.O Box 35135 Plot 6438 Mungwi Road LUSAKA Queries to Luke Njovu, Director of Corporate Affairs Tel +260 211 246555 246442/3 By Order of the Board Deborah Bwalya COMPANY SECRETARY 20th May 2014
  • 8. NATIONAL BREWERIES PLC Final Dividend At a Board Meeting held on 14th May 2014, the Board resolved not to recommend a dividend. Given the significant capital expenditure programmes underway and proposed for the next financial year, the Board agreed not to recommend a dividend. By Order of the Board Deborah Bwalya COMPANY SECRETARY 20th May 2014

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