For immediate release |
29 September
2017 |
AfriAg Global PLC
(“AfriAg Global”, the “Group” or the
“Company”)
Unaudited Interim
Results for the six months to 30 June
2017
AfriAg Global PLC (NEX: AFRI), the London listed global food logistics
specialists, today announces another very solid period of growth
with the publishing of these unaudited interim results for the
6-month period ended 30 June
2017.
Summary of Financial Results for the
period:
- The Group’s gross turnover has increased by over 28 % to £1.829
million for the period (6 months ended 30
June 2016 – £1.422 million).
- The Group’s net loss after taxation for the period was £59,000
(6 months ended 30 June 2016 -
£48,000 profit).
- The Group’s current assets including cash of £127,000 at
30 June 2017 amounted to £1,141,000
(6 months ended 30 June 2016:
£1,063,000).
David Lenigas, Executive Chairman of AfriAg Global,
commented: "The start of 2017 has seen the Company’s core
food logistics business continue to grow. The Company’s 40% owned
AfriAg (Pty) Ltd also entered exciting growth markets of the
legalised medical cannabis through its new strategic
alliance with Canadian listed LGC Capital Limited (TSXV:LG) to
create a new 50/50 Joint Venture to grow and distribute medical
cannabis products in the southern African region for export to
regulated and certified end users around the world. We look forward
to providing further news of the JV’s first new deal with the
signing of sole and exclusive agreements to acquire a 60%
interest in South Africa’s House of Hemp, as announced 18 July 2017.”
Related Party Transaction
David Lenigas serves as the Chairman of AfriAg, AfriAg Global
and LGC. Pursuant to the NEX Exchange Growth Market Rules for
Issuers, the transaction with AfriAg constitutes a related party
transaction.
Strategic Review for the Period:
AfriAg Marketing:
(100% owned by the Company)
The first half of 2017 has been period of stability for the
Company, with its 100% owned marketing division AfriAg Marketing
Pty Ltd ("AfriAg Marketing") generating stable revenues, comparable
to the same period last year, of ZAR 30.4
million (£1.8 million) with a marginal net loss for the
period of ZAR 0.6 million (£37,000)
and total assets of ZAR 8.8 million
(£522,000).
AfriAg Marketing has had an excellent first half trading
performance for the period as we continued to trade and ship our
core lines fruit and vegetables from Africa to export markets mainly in
Europe.
Our main ranges include:
Fruit:
Range: Blueberry, passion fruit, pineapple, apple,
pomegranate, litchi, strawberry
Locations: South
Africa and Zimbabwe
Vegetables:
Range: Butternut, peas, fine beans, mange tout,
sugar snap, baby corn, chillies, baby veg
Locations: South
Africa, Zimbabwe, Kenya, Zambia
Under Development:
Range: Micro herbs, herbs
Locations: Zimbabwe, Kenya
AfriAg (Pty) Ltd:
(40% owned by the Company)
In addition, the Company is pleased to report that the
specialist global agri-logistics group AfriAg (Pty) Ltd (“AfriAg”),
in which the Company has a 40% equity shareholding, continues to
generate stable revenues and profits comparable to the same period
last year.
AfriAg continued to grow its core business of exports of
perishable food from southern Africa to global markets stretching from
Asia, the USA and Europe. The business has also seen an increase
in business from shipments of frozen meat products by sea and road
from South America, Europe and the USA in to Africa.
On 26 June 2017, the Company
announced a new agricultural initiative in southern Africa, that AfriAg entered into a strategic
alliance with Canadian listed LGC Capital Limited (TSXV-QBA) to
create a new 50/50 Joint Venture to grow and distribute medical and
recreational cannabis products in the southern African region for
export to regulated and certified end users around the world. I
serve as the Chairman of both AfriAg Global Plc and LGC Capital Ltd
and I am on the board of AfriAg.
The new Joint Venture will aim to develop a fully-regulated
cannabis growing and processing industry in the southern African
region for export to certified end users world-wide. AfriAg will
assist LGC with securing significant agricultural land packages and
processing facilities in the region to grow cannabis crops and
produce, including seeds, cannabis extracted oils, dried marijuana
leafs, cigarettes and vapours.
After the period ended, AfriAg and its joint venture partner in
the new southern African medical cannabis initiative, LGC Capital,
signed a sole and exclusive agreement to acquire a 60% interest in
South Africa’s House of Hemp.
The House of Hemp in South Africa has a long term lease
on the only certified indoor growing facility for the possession
and cultivation of the Cannabis Sativa Plant for research purposes
which includes growing, extraction and packaging, at the Dube
TradePort AgriZone, which is located within the highly secure
precinct of the Durban International Airport.
The Greenhouse “Block D” site is currently the only approved
hemp/cannabis indoor growing site in South Africa. The site
consists of approx. 37,633m² (405,000 square feet) of fully
equipped, temperature regulated and humidity controlled greenhouse
under glass plus associated support infrastructure comprising
refrigerated pack houses, laboratories and
offices covering 1,760m2 (19,000 square feet).
In 2010 House of Hemp became the first private company
in South Africa to be awarded an exclusive permit from
the Department of Agriculture and the Department of Health to
legally cultivate and process hemp and cannabis products.
Since its establishment, the House of Hemp has been targeting
research on all cannabis-related markets (textiles/fibres,
oil/nutrition and medicinal) and has been appointed to coordinate
commercial research on medical cannabis and is currently in the
process of securing a second R&D license to grow and
commercialize medicinal cannabis and medicinal cannabis products
with varying Tetrahydrocannabinol (“THC”) and CBD content, and to
operate legally in South Africa .
The Transaction
As announced on 18 July 2017, LGC
and AfriAg have jointly signed a binding agreement with the House
of Hemp in South Africa, for the sole and exclusive right to
acquire a 60% beneficial interest in the House of Hemp and upon
signing this agreement, made an initial payment of
CDN $19,595. LGC and AfriAg also committed to pay an
additional amount of CDN$37,000 which was paid July
28th 2017 to House of Hemp for (August 2017 general overheads, salaries and
growing facility lease payments. LGC and AfriAg have and will
continue paying CDN $37,000 monthly for a period of six months
to keep House of Hemp fully funded while completing the transfer of
interest documentation and to allow for sufficient time to complete
investigative studies on the most cost-efficient ways of commencing
scalable production. As part of the transaction, LGC and AfriAg
have also committed to secure the necessary CDN $4.9
million estimated to commence large scale trial production
within the Dube TradePort Block D greenhouses as soon as
development plans are finalised.
About Dube TradePort
Dube TradePort Corporation, a business entity of the
KwaZulu-Natal Provincial Government, is charged with the
responsibility to develop the province’s biggest infrastructural
project. Considered one of South Africa’s top 10 investment
opportunities, this designated Special Economic Zone (SEZ) is
geared to promote foreign and local investment.
The precinct is strategically located 30km north of the important
coastal city of Durban, in KwaZulu-Natal, on South Africa’s
eastern seaboard. This over 3,000 hectare development is home to
the state-of-the-art King Shaka International Airport and is
ideally positioned 30 minutes from Africa’s busiest cargo port,
Durban Harbour, and 90 minutes from Richards Bay Harbour.
Dube TradePort takes advantage of its prime location as the only
facility in Africa combining an international airport,
dedicated cargo terminal, warehousing, offices, retail, hotels and
agriculture.
About Dube AgriZone
Dube AgriZone is Africa’s first integrated perishables supply
chain and the most technologically advanced future farming platform
on the continent.
This high-tech agricultural development, which forms part of the
Dube TradePort Special Economic Zone (SEZ), is host to the largest
climate-controlled glass-covered growing area in Africa. It
aims to stimulate the growth of KwaZulu-Natal's perishables sector
and affords the opportunity to achieve improved agricultural
yields, consistent quality, year-round production and the superior
management of disease and pest.
The facility's primary focus is on the production of short
shelf-life vegetables and other horticultural products which
require immediate post-harvest airlifting and supply to both
domestic and export markets. The present phase one development
comprises an extensive 16 hectares of greenhouses, dedicated
post-harvest packhouses, a central packing and distribution centre,
a nursery and a sophisticated plant tissue culture laboratory, Dube
AgriLab.
Outlook:
The overall business is running very smoothly and we continue to
see solid growth in all sectors. We reasonably expect this trend to
continue. We see our new medical cannabis initiatives as an area of
new focus for the Company going forward and we see tremendous
upside for this sector and we want to be at the forefront of this
sector in Africa.
Financial Results:
During the period, the Company increased revenues to £1,829,000
(6 months ended 30 June 2016:
£1,422,000) and made a gross profit of £127,000 (6 months ended
30 June 2016: £183,000). The
operating loss for the period was £68,000 (6 months ended
30 June 2016: profit £6,000). The
total comprehensive loss for the period attributable to equity
holders of the parent was £17,000 (6 months ended 30 June 2016: profit £87,000).
There was a weighted loss per share of 0.004p (30 June 2016: earnings per share
0.003p).
Current assets at 30 June 2017
amounted to £1,141,000 (30 June 2016:
£1,063,000).
The unaudited interim results to 30 June
2017 have not been reviewed by the Company’s auditor.
In Conclusion:
The Board would like to take this opportunity to thank our
shareholders, staff and consultants for their continued support and
I look forward to reporting further progress over the next period
and beyond.
The directors of the Company accept responsibility for the
contents of this announcement.
David Lenigas
Executive Chairman
29 September 2017
For further information, please
contact:
AfriAg Global plc:
+44 (0) 20 7440 0640
David Lenigas
Corporate Adviser and Broker:
Peterhouse Corporate Finance Limited
+44 (0) 20 7469 0930
Guy Miller / Fungai Ndoro
Condensed Consolidated Statement of
Comprehensive Income (unaudited)
for the 6 months ended 30 June
2017
|
|
|
|
|
|
|
6 months
to |
6 months
to |
Year
ended |
|
|
30
June |
30
June |
31
December |
|
|
2017 |
2016 |
2016 |
|
|
Unaudited |
Unaudited |
Audited |
|
Note |
£’000 |
£’000 |
£’000 |
|
|
|
|
|
|
|
|
|
|
Revenue |
|
1,829 |
1,422 |
3,035 |
Cost of sales |
|
(1,702) |
(1,239) |
(2,701) |
Gross
Profit |
|
127 |
183 |
334 |
|
|
|
|
|
Administration
expenses |
|
(195) |
(177) |
(367) |
Share Based Payment
Charge |
|
- |
- |
98 |
|
|
|
|
|
Operating
(loss)/profit |
|
(68) |
6 |
(131) |
|
|
|
|
|
Share of associate
result |
|
21 |
6 |
42 |
Finance costs |
|
- |
(5) |
(5) |
Investment income |
|
(12) |
41 |
85 |
|
|
|
|
|
(Loss)/profit
before tax |
|
(59) |
48 |
(9) |
Tax |
|
- |
- |
- |
|
|
|
|
|
Retained
(loss)/profit for the period |
|
(59) |
48 |
(9) |
|
|
|
|
|
Other comprehensive
income |
|
|
|
|
Gain/(loss) on
revaluation of available for sale investments |
|
1 |
(6) |
5 |
Transfer to income
statement |
|
14 |
(24) |
(55) |
Translation exchange
gain |
|
27 |
69 |
160 |
Total comprehensive income |
|
42 |
39 |
110 |
Total comprehensive
income/(loss) for the period attributable to equity holders of the
parent |
|
(17) |
87 |
101 |
|
|
|
|
|
Earnings/(loss) per
share (pence) |
2 |
|
|
|
Basic |
|
(0.004) |
0.003 |
(0.001) |
Diluted |
|
(0.004) |
0.003 |
(0.001) |
All of the revenues and loss above derived from continuing
operations.
Condensed Consolidated Statement of
Financial Position (unaudited)
At 30 June 2017
|
|
30 June
2017 |
30 June
2016 |
31
December 2016 |
|
|
Unaudited |
Unaudited |
Audited |
|
|
£’000 |
£’000 |
£’000 |
|
|
|
|
|
Non-current
assets |
|
|
|
|
Property, plant &
equipment |
|
6 |
4 |
5 |
Investments in
associates |
|
1,539 |
1,482 |
1,518 |
Total non-current
assets |
|
1,545 |
1,486 |
1,523 |
|
|
|
|
|
Current
assets |
|
|
|
|
Inventory |
|
- |
5 |
9 |
Trade and other
receivables |
|
1,012 |
758 |
976 |
Available for sale
assets |
|
2 |
128 |
35 |
Cash and cash
equivalents |
|
127 |
172 |
240 |
Total current
assets |
|
1,141 |
1,063 |
1,261 |
|
|
|
|
|
|
|
|
|
|
Total
assets |
|
2,686 |
2,549 |
2,783 |
|
|
|
|
|
Current
liabilities |
|
|
|
|
Trade and other
payables |
|
(907) |
(865) |
(987) |
Total current
liabilities |
|
(907) |
(865) |
(987) |
|
|
|
|
|
|
|
|
|
|
Net current
assets |
|
234 |
198 |
274 |
|
|
|
|
|
Net assets |
|
1,779 |
1,684 |
1,796 |
|
|
|
|
|
Equity |
|
|
|
|
Share capital |
|
1,381 |
1,381 |
1,381 |
Share premium
account |
|
8,528 |
8,548 |
8,528 |
Share based payment
reserve |
|
279 |
213 |
279 |
Revaluation
reserves |
|
(21) |
(16) |
(36) |
Foreign currency
reserve |
|
64 |
(54) |
37 |
Retained earnings |
|
(8,452) |
(8,368) |
(8,393) |
|
|
|
|
|
Total
equity |
|
1,779 |
1,684 |
1,796 |
Condensed Consolidated Statement of
Changes in Equity (unaudited)
for the 6 months ended 30 June
2017
|
Share
capital |
Share
premium |
Share based
payment
reserve |
Foreign currency
reserve |
Revaluation
reserves |
Retained
earnings |
Total |
|
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
£’000 |
At 31 December 2015 |
1,381 |
8,528 |
213 |
(123) |
14 |
(8,416) |
1,597 |
|
|
|
|
|
|
|
|
Profit for the period |
- |
- |
- |
- |
- |
(9) |
(9) |
Currency translation gain |
- |
- |
- |
160 |
- |
- |
160 |
(Loss) on revaluation of available
for sale investments |
- |
- |
- |
- |
5 |
- |
5 |
Transfer to income statement |
- |
- |
- |
- |
(55) |
- |
(55) |
Total Comprehensive
Income |
- |
- |
- |
160 |
(50) |
(9) |
101 |
Shares options expired |
- |
- |
(32) |
- |
- |
32 |
- |
Share based payment charge |
- |
- |
98 |
- |
- |
- |
98 |
Total contributions by and
distributions to owners of the Company |
- |
- |
66 |
- |
- |
32 |
98 |
At 31 December 2016 |
1,381 |
8,528 |
279 |
37 |
(36) |
(8,393) |
1,796 |
|
|
|
|
|
|
|
|
(Loss) for the period |
- |
- |
- |
- |
- |
(59) |
(59) |
Currency translation (loss) |
- |
- |
- |
27 |
- |
- |
27 |
Gain on revaluation of available for
sale investments |
- |
- |
- |
- |
1 |
- |
1 |
Transfer to income statement |
- |
- |
- |
- |
14 |
- |
14 |
Total Comprehensive
Income |
- |
- |
- |
27 |
15 |
(59) |
(17) |
Shares issue costs |
- |
- |
- |
- |
- |
- |
- |
Total contributions by and
distributions to owners of the Company |
- |
- |
- |
- |
- |
- |
- |
At 30 June 2017 |
1,381 |
8,528 |
279 |
64 |
(21) |
(8,452) |
1,779 |
Condensed Consolidated Statement of
Cash Flows (unaudited)
for the 6 months ended 30 June
2017
|
6 months
to |
6 months
to |
Year
ended |
|
30 June
2017 |
30 June
2016 |
31
December 2016 |
|
Unaudited |
Unaudited |
Audited |
|
£’000 |
£’000 |
£’000 |
|
|
|
|
Cash flows from
operations |
|
|
|
Operating
(loss)/profit |
(68) |
6 |
(131) |
Decrease/(increase) in
inventories |
9 |
(5) |
(9) |
(Increase) in trade
& other receivables |
(36) |
(373) |
(591) |
(Decrease)/increase in
trade & other payables |
(80) |
174 |
296 |
Share option
charge |
- |
- |
98 |
Net cash used in
operating activities |
(175) |
(198) |
(337) |
|
|
|
|
Investing
activities |
|
|
|
Investment income |
1 |
7 |
9 |
Finance costs |
- |
(5) |
(5) |
Receipts on sale of
AFS investments |
36 |
53 |
168 |
Payments for PPE
assets |
(2) |
(2) |
(3) |
Net cash from
investing activities |
35 |
53 |
169 |
|
|
|
|
Financing
activities |
|
|
|
Issue of share
capital |
- |
- |
- |
Issue costs |
- |
- |
- |
Net cash from
financing activities |
- |
- |
- |
|
|
|
|
Net (decrease) in
cash and cash equivalents |
(140) |
(145) |
(168) |
Cash and cash
equivalents at the beginning of period |
240 |
248 |
248 |
Effect of foreign
exchange on cash and cash equivalents |
27 |
69 |
160 |
Cash and cash
equivalents at the end of period |
127 |
172 |
240 |
Notes to the Condensed Consolidated
Interim Financial Information (unaudited)
1.General information
The condensed consolidated interim financial information for the
period ended 30 June 2017 has not
been audited or reviewed in accordance with the International
Standard on Review Engagements 2410 issued by the Auditing
Practices Board. The figures were prepared using applicable
accounting policies and practices consistent with those adopted in
the statutory accounts for the period ended 31 December 2016. The figures for the period
ended 31 December 2016 have been
extracted from these accounts, which have not been required to be
delivered to the Isle of Man Registrar of Companies, and do however
contained an unqualified audit report.
The condensed consolidated interim financial information
contained in this document does not constitute statutory accounts.
In the opinion of the directors the financial information for this
period fairly presents the financial position, result of operations
and cash flows for this period.
The Condensed Consolidated Interim Financial Information was
approved by the Board of Directors on 28
September 2017.
Statement of compliance
These condensed consolidated interim financial statements have
been prepared in accordance with International Financial Reporting
Standards (IFRS) as adopted by the European Union with the
exception of International Accounting Standard (‘IAS’) 34 – Interim
Financial Reporting. Accordingly, the interim financial statements
do not include all of the information or disclosures required in
the annual financial statements and should be read in conjunction
with the Group’s 2016 annual financial statements.
2.Earnings / (loss) per share
The calculation of the earnings/(loss) per share is based on the
profit/(loss) attributable to ordinary shareholders divided by the
weighted average number of shares in issue during the
period.
|
6 months
to |
6 months
to |
Year |
|
30
June |
30
June |
31
December |
|
2017 |
2016 |
2016 |
|
Unaudited |
Unaudited |
Audited |
|
£’000 |
£’000 |
£’000 |
(Loss)/profit
attributable to equity holders of the Group |
(59) |
48 |
(9) |
|
|
|
|
Number of Shares |
|
|
|
|
|
|
|
Weighted average
number of ordinary shares |
1,381,001 |
1,381,001 |
1,381,001 |
Share options in
issue |
79,000 |
79,000 |
79,000 |
Weighted average
number of ordinary shares - diluted |
1,460,001 |
1,460,001 |
1,459,833 |
|
|
|
|
Earnings/(loss) per
share – basic |
(0.004) |
0.003 |
(0.001) |
Earnings/(loss) per
share – diluted |
(0.004) |
0.003 |
(0.001) |
3.Events after the end of the
reporting period
On 12 September 2017, the Company
announced that it has raised £200,000 before expenses through the
subscription for 80 million new ordinary shares in the Company at a
price of 0.25 pence per Share, to a
number of places.
4.A copy of this interim financial
statement is available on the Company’s website:
www.afriagglobal.com.