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Share Name Share Symbol Market Type Share ISIN Share Description
Meikles Limited LSE:MIK London Ordinary Share ZW0009012114 ZWR 0.1
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 0.00 -
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Unknown 791.6 81.5 21.0 0.0 0

Meikles Ld Abridged Financial Results for the y/e 31 Mar 2020

24/08/2020 11:21am

UK Regulatory (RNS & others)


 
TIDMMIK 
 
MEIKLES LIMITED 
 
ABRIDGED AUDITED FINANCIAL RESULTS FOR THE YEARED 31 MARCH 2020 
 
CHAIRMAN'S STATEMENT 
 
It gives me pleasure to present the Chairman's Statement for the financial year 
ended 31 March 2020. 
 
FINANCIAL OVERVIEW 
 
The Group did not anticipate the advent of COVID-19. The impact of the virus 
has affected the latter part of the financial year under review. It is apparent 
that the continued impact of the virus will affect the world and Zimbabwe for 
an unpredictable period into the Group's new financial year. 
 
The Group restructured its finances in recognition of stresses in the local 
environment. It is fortunate that the structural adjustments will also enable 
the Group to withstand damages caused by the virus. 
 
The Group decided sometime ago to ensure that it remains in a position to fund 
capital expansion projects, replacement requirements, provide working capital 
and be in a position to continue paying dividends to shareholders, without 
placing adverse pressure on Group resources. 
 
Shareholders are advised that the Group financial restructuring has been 
successfully implemented. The Group is in a net cash in hand position, but in 
the process of achieving this position most Group bank borrowings were repaid 
within the year under review and subsequent to the year-end, the remaining out 
of term bank borrowings have been repaid. This position has been achieved from 
normal operating cash flows and puts the Group in an unsurpassed financial 
position since the dollarisation in 2009. The sale of the Harare based hotel 
has increased the Group's total current assets which are substantially more 
than current liabilities. 
 
FINANCIAL REPORTING 
 
There were two developments during the financial year under review with 
significant impact to financial reporting: - 
 
IAS 29 - Financial Reporting in Hyperinflationary economies 
 
The Public Accountants and Auditors Board (PAAB) issued a pronouncement in 
October 2019 indicating that factors and conditions to apply International 
Accounting Standard (IAS) 29 - Financial Reporting in Hyperinflationary 
Economies had been met in Zimbabwe. In accordance with IAS 29, historical cost 
financial information has been restated for changes in general purchasing power 
of the Zimbabwean Dollar (ZWL). Accordingly, the inflation adjusted financial 
statements represent the primary financial statements of the Group. The 
historical cost financial statements have been provided as supplementary 
information. 
 
Adoption of IFRS 16 - Leases 
 
The Group adopted International Financial Reporting Standard (IFRS) 16 for the 
first time on 1 April 2019. The impact of the adoption of IFRS 16 is set out in 
note 8 of these abridged financial results. 
 
GROUP FINANCIAL PERFORMANCE 
 
 
The Group delivered strong financial results in a tough operating environment 
with several impediments. Commentary on financial performance is based on 
inflation adjusted figures. 
 
Group revenue for continuing operations grew by 6% from ZWL 8.3 billion in 2019 
to ZWL 8.8 billion in the year under review. 
 
Profit for the year grew from ZWL 320.6 million in prior year to ZWL 1.4 
billion. Growth in Profit for the year was boosted by ZWL 118.7 million profit 
on disposal of Meikles Hotel. 
 
Total comprehensive income for the year was ZWL 1.1 billion (2019: ZWL 561.4 
million), of which ZWL 790.8 million was attributable to the owners of the 
parent with the remaining balance of ZWL 340.7 million being for minority 
shareholders. 
 
Segmental contributions to the Group's financial performance is set out in note 
5 of these abridged financial results.. 
 
REVIEW OF OPERATIONS 
 
Supermarkets - trading as TM Pick n Pay 
 
Revenue increased by 2% over the previous year in inflation adjusted terms. 
Sales volume declined by 22% due to diminishing customer disposable income over 
the period. 
 
Profit after tax grew to ZWL 674.8 million from a loss of ZWL 21 million in the 
previous year. Profit growth was achieved through a focussed approach to margin 
and operating expenditure control. 
 
The profit after tax was after deducting exchange losses of ZWL 380.6 million. 
These exchange losses arose from foreign currency denominated liabilities 
(legacy debt) accumulated prior to introduction of local currency on 22 
February 2019. Going forward, there will be no exchange losses as legacy debt 
exposure has now been eliminated. 
 
Legacy debt reduced to US$ 2.23 million at 31 March 2020 from US$ 13.3 million 
at the beginning of the financial year.  The payment of legacy debt was funded 
from internally generated funds. After year-end, US$ 0.6 million was paid, 
leaving the outstanding balance at US$ 1.63 million. In addition, ZWL 1.63 
million was remitted to the Reserve Bank of Zimbabwe (RBZ) to complete all 
processes according to the RBZ's guidelines on blocked funds or "legacy debt" 
contained in Exchange Control Directive RU28 dated 21 February 2019 and 
Exchange Control Circular No.8 of 24 July 2019. Accordingly, it is anticipated 
the RBZ will issue an instrument that will settle US$ 1.63 million without 
further costs to the segment. 
 
The segment invested ZWL 386.6 million in seven (7) store upgrades and 
construction of an upmarket mall in Marondera. 
 
The clearance of foreign currency denominated liabilities has well positioned 
the segment for accelerated store upgrades, branch network expansion, 
commencement of dividend payment to shareholders and a boost on the working 
capital front. 
 
Agriculture 
 
Profit after tax was ZWL 157.2 million (2019: ZWL 332 million). 
 
The hailstorm of January 2019, Cyclone Idai in March 2019 as well as very dry 
and hot September to November 2019 period affected our tea production and 
ensuing season's macadamia crop. The Company's annual made tea production of 8 
319 tonnes (2019: 10 171 tonnes) was reflective of these adverse weather 
conditions. 
 
International tea prices weakened by 14% from US$ 1.64 per kilogram in prior 
year to US$ 1.44 per kilogram in the year ended 31 March 2020 due to increased 
supply of tea by Kenya which has not been matched by corresponding world 
demand. 
 
The much-needed RBZ authority to increase promotional spend in South Africa has 
been secured. This will help to support market penetration efforts to grow 
packed tea exports. 
 
Export earnings from macadamia nuts, avocadoes and coffee grew by 78% from US$ 
4.5 million in prior year to US$ 8 million in the year ended 31 March 2020. As 
a percentage of total exports, these three crops contributed 43% up from 25% in 
the prior year. Contribution of the high value crops to the Company's export 
earnings is expected to rise to 60% by March 2022 as the bulk of them reach 
maturity. In volume terms, macadamia and avocado export sales grew by 129% and 
39% respectively. 
 
To mitigate the inefficiencies caused by power shortages in the country, the 
Company has embarked on a 7.5 Mega Watt solar project covering all estates and 
Mutare factory. Phases 1 to 3 of the project covering Ratelshoek, Tingamira and 
Jersey estates are already under implementation. Ratelshoek's 1.8 Mega Watt 
solar plant is expected to be completed by September 2020. Tingamira's 1.6 Mega 
Watt and Jersey's 2.0 Mega Watt plants are expected to be completed by December 
2020. By end of December 2020 we will have implemented 72% of the project. This 
project is expected to result in an efficient and integrated power supply 
system that will give impetus to the growth and maturity of our high value 
crops and efficient crop processing. 
 
Hospitality 
 
Profit after tax from continuing operations increased to ZWL 184.7 million in 
the current year from ZWL 72.5 million in the previous year. 
 
The disposal of Meikles Hotel was completed at the end of February 2020 and 
control was transferred to the buyer in March 2020. The financial results of 
the hotel for the period up to the date of disposal as well as the profit on 
disposal are included under discontinued operations. 
 
The refurbishment of The Victoria Falls Hotel was due to commence in April 2020 
but has been disrupted by the outbreak of the COVID-19 pandemic. The hotel 
closed in March 2020 when international travel and tourism stopped as countries 
implemented travel restrictions and lockdowns to contain the spread of the 
corona virus. 
 
Properties 
 
Plans to renovate and upgrade the Group's property portfolio are at an advanced 
stage and the roll out is anticipated to commence during the second half of the 
forthcoming financial year. Several tenants have expressed interest to lease 
the properties which had been left vacant following the closure of the Group's 
departmental stores. 
 
Security Services 
 
Meikles Guard Services fared well during the financial year and was not 
disrupted by loss of contract when the departmental stores closed. The segment 
secured additional contracts from third parties during the year. 
 
MEIKLES FOUNDATION 
 
During the year under review, Meikles Foundation played its part in providing 
much needed help to disadvantaged members of society. Further details on the 
Foundation's activities are provided in the Annual Report. 
 
CORPORATE SUSTAINABILITY 
 
With the growing call for sustainability following the COVID-19 pandemic, the 
Group made a strategic decision to realign existing practices with consistent 
sustainability values across the Group. In doing so, the Group opted to adopt 
the Global Reporting Initiatives (GRI) Standards as a catalyst and business 
strategy for re-engineering our value chains for long term business success and 
sustainable decision making into the future. Sustainability will be the 
cornerstone for maintaining the Meikles legacy created over a century. Our 
sustainability strategy will now anchor how our brands compete and deliver 
value to our customers and stakeholders in our markets. The Group will 
calibrate practices across all subsidiaries for the successful implementation 
of the strategy. 
 
DIVID 
 
 
In view of the Group's financial results for the year ended 31 March 2020, the 
Board has declared a final dividend of 42.5 ZWL cents per share, bringing the 
total dividend for the year to 60 ZWL cents. The final dividend will amount to 
ZWL 111 million. A full dividend announcement will be published separately in 
due course. 
 
DIRECTORATE 
 
The Board welcomed, Ms Cathrine Chitiyo, Mr Stewart Cranswick and Mr Simon 
Hammond as Independent Non-Executive Directors of the Company as part of the 
steps to comply with the requirements of the Companies and Other Business 
Entities Act (Chapter 24:31) and Statutory Instrument (SI) 134 of 2019 
(Zimbabwe Stock Exchange Listings Requirements). 
 
STRATEGY AND OUTLOOK 
 
The financial strategy set out under Financial Overview in this report will 
continue to be applied during the forthcoming year. The Group is well placed to 
support its long-term objectives. 
 
Despite the absence of income from Hospitality together with its continuing 
cost commitments, the Group's profit performance to date for the new financial 
year is ahead of expectations, but there are uncertainties going forward in 
terms of risk. 
 
The COVID-19 impact is causing supermarkets to close for periods to facilitate 
disinfection whenever a case of the disease is identified. The cost of such 
closures is significant but necessary. Nevertheless, the Group is to continue 
with its expansion and renovation plans with a focus on both Tanganda and 
Supermarkets. 
 
The Victoria Falls Hotel is closed and is on care and maintenance basis. 
Fortunately, the hotel has working capital resources which will enable it to 
maintain its financial independence well into the next calendar year. 
Shareholders are advised that the Cape Grace hotel is in the same position 
 
APPRECIATION 
 
I would like to extend my appreciation to our customers as well as suppliers 
for their continued support and to our shareholders, stakeholders and 
regulatory authorities for their assistance and guidance. I would also like to 
extend my thanks and appreciation to fellow Board members, management and staff 
for their dedication and commitment. 
 
JRT Moxon 
 
Executive Chairman 
 
19 August 2020 
 
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME 
 
FOR THE YEARED 31 MARCH 2020 
 
                                                          INFLATION ADJUSTED      HISTORICAL COST* 
 
                                                           31 March    31 March    31 March  31 March 
                                                               2020        2019        2020      2019 
 
CONTINUING OPERATIONS                                       ZWL 000     ZWL 000     ZWL 000   ZWL 000 
 
Revenue                                                   8,835,523   8,285,324   4,201,837   790,828 
 
Net operating costs                                     (8,325,514) (7,157,752) (3,513,677) (698,600) 
 
Operating profit                                            510,009   1,127,572     688,160    92,228 
 
Investment income                                             4,944         802       3,807        43 
 
Finance costs                                              (75,119)    (90,921)    (38,156)   (8,432) 
 
Net exchange gains / (losses)                                29,861    (47,604)     111,784   (6,413) 
 
Fair value adjustments on biological assets                  90,312      49,171     183,515     9,433 
 
Net monetary gain / (loss)                                1,174,469   (688,815)           -         - 
 
Profit before tax                                         1,734,476     350,205     949,110    86,859 
 
Income tax expense                                        (459,521)   (153,900)   (230,413)  (16,845) 
 
Profit for the year from continuing operations            1,274,955     196,305     718,697    70,014 
 
DISCONTINUED OPERATIONS 
 
Profit / (loss) for the year from discontinued              118,718     124,248     307,969   (4,056) 
operations 
 
PROFIT FOR THE YEAR                                       1,393,673     320,553   1,026,666    65,958 
 
Other comprehensive (loss) / income, net of tax 
 
Items that will not be reclassified subsequently 
to profit or loss: 
 
   Fair value loss on investments in equity               (249,651)    (74,536)   (249,651)   (9,600) 
instruments designated as at FVTOCI 
 
Items that may be reclassified subsequently to 
profit or loss: 
 
    Exchange rate and monetary adjustments on              (12,608)     315,355     606,925    61,970 
translation of foreign operations 
 
Other comprehensive (loss) / income for the               (262,259)     240,819     357,274    52,370 
year, net of tax 
 
TOTAL COMPREHENSIVE INCOME FOR THE YEAR                   1,131,414     561,372   1,383,940   118,328 
 
Profit / (loss) for the year attributable to: 
 
     Owners of the parent                                 1,053,010     325,054     907,868    53,827 
 
     Non-controlling interests                              340,663     (4,501)     118,798    12,131 
 
                                                          1,393,673     320,553   1,026,666    65,958 
 
Total comprehensive income / (loss) attributable 
to: 
 
     Owners of the parent                                   790,751     565,873   1,265,142   106,197 
 
     Non-controlling interests                              340,663     (4,501)     118,798    12,131 
 
                                                          1,131,414     561,372   1,383,940   118,328 
 
Earnings per share in cents 
 
Basic earnings per share - continuing and                    403.35      126.76      347.76     20.99 
discontinued operations 
 
Basic earnings per share - continuing operations             357.88       78.31      229.79     22.57 
 
Diluted earnings per share - continuing and                  378.39      118.78      326.24     19.67 
discontinued operations 
 
Diluted earnings per share - continuing                      335.73       73.38      215.57     21.15 
operations 
 
Headline earnings per share - continuing and                 377.25      127.93      221.12     21.43 
discontinued operations 
 
Headline earnings per share - continuing                     360.18       79.48      229.63     23.01 
operations 
 
Diluted headline earning per share - continuing              353.90      119.87      207.44     20.09 
and discontinued operations 
 
Diluted headline earnings per share - continuing             337.89       74.47      215.43     21.57 
operations 
 
*Historical cost financial results are provided only as supplementary 
information. The primary financial statements are the inflation adjusted 
results. The auditor's opinion relates only to the inflation adjusted financial 
results. 
 
CONSOLIDATED STATEMENT OF FINANCIAL POSITION 
 
AS AT 31 MARCH 2020 
 
                                                 INFLATION ADJUSTED    HISTORICAL COST* 
 
                                                    31 Mar    31 Mar     31 Mar     31 Mar 
                                                      2020      2019       2020       2019 
 
                                                   ZWL 000   ZWL 000    ZWL 000    ZWL 000 
 
ASSETS 
 
Non-current assets 
 
Property, plant and equipment                    2,441,525 2,162,976    403,617    172,267 
 
Investment property                                  2,938     2,980        231        236 
 
Right of use assets                                399,412         -     75,885          - 
 
Investment in Mentor Africa (Pty)                  171,813   394,236    171,813     50,778 
Limited 
 
Biological assets                                   22,503    22,547     22,503      2,905 
 
Intangible assets                                    1,570     1,570        124        124 
 
Other financial assets                             264,369   304,590    263,440     31,847 
 
Deferred tax                                            69    50,845     20,637      9,111 
 
Total non-current assets                         3,304,199 2,939,744    958,250    267,268 
 
Current assets 
 
Inventories                                        775,296   824,382    565,008    100,163 
 
Trade and other receivables                        622,101   316,583    606,212     40,471 
 
Biological assets - produce on bearer              187,052    86,785    187,052     11,178 
plants 
 
Other financial assets                               3,543       354      3,543          9 
 
Cash and bank balances                             262,469   256,255    262,469     33,006 
 
                                                 1,850,461 1,484,359  1,624,284    184,827 
 
Assets held for sale                                   388   380,983          9     30,032 
 
Total current assets                             1,850,849 1,865,342  1,624,293    214,859 
 
Total assets                                               4,805,086  2,582,543    482,127 
                                                 5,155,048 
 
EQUITY AND LIABILITIES 
 
Capital and reserves 
 
Share capital                                       32,854    32,854      2,611      2,611 
 
Share premium                                       40,997    40,997      3,925      3,925 
 
Other reserves                                    (34,362)   564,409    395,603     64,929 
 
Retained earnings                                2,735,739 1,428,204  1,020,252    131,914 
 
Equity attributable to equity holders            2,775,228 2,066,464  1,422,391    203,379 
of the parent 
 
Non-controlling interests                          835,177   461,908    177,063     48,999 
 
Total equity                                     3,610,405 2,528,372  1,599,454    252,378 
 
Non-current liabilities 
 
Borrowings                                          29,314    95,063     29,314     12,244 
 
Deferred tax                                       649,576   596,360     88,022     25,617 
 
Lease liabilities                                   91,527         -     91,527          - 
 
Total non-current liabilities                      770,417   691,423    208,863     37,861 
 
Current liabilities 
 
Trade and other payables                           736,775 1,185,296    736,775    140,368 
 
Borrowings                                          30,788   399,995     30,788     51,520 
 
Lease liabilities                                    6,663         -      6,663          - 
 
Total current liabilities                          774,226 1,585,291    774,226    191,888 
 
Total liabilities                                1,544,643 2,276,714    983,089    229,749 
 
Total equity and liabilities                     5,155,048 4,805,086  2,582,543    482,127 
 
 
*Historical cost financial results are provided only as supplementary 
information. The primary financial statements are the inflation adjusted 
results. The auditor's opinion relates only to the inflation adjusted financial 
results. 
 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY 
 
FOR THE YEARED 31 MARCH 2020 
 
INFLATION ADJUSTED 
 
                                    Share     Share     Other 
                                  capital   premium  reserves Investments  Retained 
                                                              revaluation  earnings 
 
                                      ZWL       ZWL       ZWL         ZWL       ZWL 
                                      000       000      000         000        000 
 
2020 
 
Balance at 1 April 2019            32,854    40,997   638,945    (74,536) 1,428,204 
 
Profit for the year                     -         -         -           - 1,053,010 
 
Transfer from non-distributable         -         - (336,512)           -   336,512 
reserves 
 
Other comprehensive income /            -         -  (12,608)   (249,651)         - 
(loss) for the year 
 
Dividend paid - ordinary                -         -         -           -  (81,987) 
shareholders 
 
Non-controlling interests               -                   - 
arising from Mopani Property                      -                     -         - 
Development (Private) Limited 
 
Balance at 31 March 2020           32,854    40,997   289,825   (324,187) 2,735,739 
 
2019 
 
Balance at 1 April 2018 as         32,406    18,582   323,590           - 1,128,057 
restated 
 
Profit / (loss) for the year            -         -         -           -   325,054 
 
Issue of shares - scrip               448    22,415         -           -         - 
dividend 
 
Dividend paid - ordinary                -         -         -           -  (24,907) 
shareholders 
 
Other comprehensive income /            -         -   315,355    (74,536) 
(loss) for the year 
 
Non-controlling interests               -                   -                     - 
arising from Mopani Property                      -                     - 
Development (Private) Limited 
 
Balance at 31 March 2019           32,854    40,997   638,945    (74,536) 1,428,204 
 
 
 
                               Attributable Non-controlling      Total 
                               to owners of       interests 
                                     parent 
 
                                        ZWL             ZWL        ZWL 
                                        000             000       000 
 
2020 
 
Balance at 1 April 2019           2,066,464         461,908  2,528,372 
 
Profit for the year               1,053,010         340,663  1,393,673 
 
Transfer from                             -               -          - 
non-distributable reserves 
 
Other comprehensive income /      (262,259)               -  (262,259) 
(loss) for the year 
 
Dividend paid - ordinary           (81,987)               -   (81,987) 
shareholders 
 
Non-controlling interests                 -          32,606     32,606 
arising from Mopani Property 
Development (Private) Limited 
 
Balance at 31 March 2020          2,775,228         835,177  3,610,405 
 
2019 
 
Balance at 1 April 2018 as        1,502,635         458,484  1,961,119 
restated 
 
Profit / (loss) for the year        325,054         (4,501)    320,553 
 
Issue of shares - scrip              22,863               -     22,863 
dividend 
 
Dividend paid - ordinary           (24,907)               -   (24,907) 
shareholders 
 
Other comprehensive income /        240,819               -    240,819 
(loss) for the year 
 
Non-controlling interests                             7,925      7,925 
arising from Mopani Property              - 
Development (Private) Limited 
 
Balance at 31 March 2019          2,066,464         461,908  2,528,372 
 
 
 
 
 
HISTORICAL COST* 
 
                                    Share     Share     Other 
                                  capital   premium  reserves Investments  Retained 
                                                              revaluation  earnings 
 
                                      ZWL       ZWL       ZWL         ZWL       ZWL 
                                      000       000      000         000        000 
 
2020 
 
Balance at 1 April 2019             2,611     3,925    74,529     (9,600)   131,914 
 
Profit for the year                     -         -         -           -   907,868 
 
Transfer from non-distributable         -         -  (26,600)           -    26,600 
reserves 
 
Other comprehensive income /            -         -   606,925   (249,651)         - 
(loss) for the year 
 
Dividend paid - ordinary                -         -         -           -  (46,130) 
shareholders 
 
Non-controlling interests               -                   - 
arising from Mopani Property                      -                     -         - 
Development (Private) Limited 
 
Balance at 31 March 2020            2,611     3,925   654,854   (259,251) 1,020,252 
 
2019 
 
Balance at 1 April 2018 as          2,562     1,469    12,559           -    81,160 
restated 
 
Profit / (loss) for the year            -         -         -           -    53,827 
 
Issue of shares - scrip                49     2,456         -           -         - 
dividend 
 
Dividend paid - ordinary                -         -    61,970     (9,600)         - 
shareholders 
 
Other comprehensive income /            -         -         -           -   (3,073) 
(loss) for the year 
 
Non-controlling interests               -                   - 
arising from Mopani Property                      -                     -         - 
Development (Private) Limited 
 
Balance at 31 March 2019            2,611     3,925    74,529     (9,600)   131,914 
 
 
 
                               Attributable Non-controlling      Total 
                               to owners of       interests 
                                     parent 
 
                                        ZWL             ZWL        ZWL 
                                        000             000       000 
 
2020 
 
Balance at 1 April 2019             203,379          48,999    252,378 
 
Profit for the year                 907,868         118,798  1,026,666 
 
Transfer from                             -               -          - 
non-distributable reserves 
 
Other comprehensive income /        357,274               -    357,274 
(loss) for the year 
 
Dividend paid - ordinary           (46,130)               -   (46,130) 
shareholders 
 
Non-controlling interests                 -           9,266      9,266 
arising from Mopani Property 
Development (Private) Limited 
 
Balance at 31 March 2020          1,422,391         177,063  1,599,454 
 
2019 
 
Balance at 1 April 2018 as           97,750          36,241    133,991 
restated 
 
Profit / (loss) for the year         53,827          12,131     65,958 
 
Issue of shares - scrip               2,505               -      2,505 
dividend 
 
Dividend paid - ordinary             52,370               -     52,370 
shareholders 
 
Other comprehensive income /        (3,073)               -    (3,073) 
(loss) for the year 
 
Non-controlling interests                 -             627        627 
arising from Mopani Property 
Development (Private) Limited 
 
Balance at 31 March 2019            203,379          48,999    252,378 
 
*Historical cost financial results are provided only as supplementary 
information. The primary financial statements are the inflation adjusted 
results. The auditor's opinion relates only to the inflation adjusted financial 
results. 
 
 
 
 
 
 
 
 
 
CONSOLIDATED STATEMENT OF CASH FLOWS 
 
FOR THE YEARED 31 MARCH 2020 
 
                                                INFLATION ADJUSTED        HISTORICAL COST* 
 
                                               31 March   31 March    31 March    31 March 
                                                   2020       2019        2020        2019 
 
                                               ZWL 000    ZWL 000     ZWL 000     ZWL 000 
 
Cash flows from operating activities 
 
Profit / (loss) before tax - continuing       1,734,476    350,205     949,110      86,859 
operations 
 
                      - discontinued            147,633    127,620     336,884     (4,231) 
operations 
 
                                              1,882,109    477,825   1,285,994      82,628 
 
Adjustments for: 
 
- Depreciation and impairment of property,      231,255    155,987      36,266      14,376 
plant and equipment; investment property 
and right-of-use assets 
 
- Net interest                                   74,379     97,114      35,621       8,591 
 
- Net exchange (gains) / losses                (20,038)     52,425   (108,886)       7,031 
 
- Fair value adjustments on biological         (90,312)   (49,171)   (183,515)     (9,433) 
assets 
 
  * Reversal of impairment of other             (3,324)          -     (3,324)           - 
    financial assets 
 
- (Profit) / loss on disposal of property,      (3,033)        241     (2,731)          42 
plant and equipment - continuing operations 
 
- (Profit) / loss on disposal of property,     (74,157)        420   (330,192)          17 
plant and equipment - discontinued 
operations 
 
Operating cash flow before working capital    1,996,879    734,841     729,233     103,252 
changes 
 
Decrease / (increase) in inventories             49,086    (4,781)   (464,845)    (56,293) 
 
Increase in trade and other receivables        (98,874)   (64,668)   (359,102)    (11,522) 
 
(Decrease) / increase in trade and other      (717,365)   (42,562)     301,070      34,088 
payables 
 
Cash generated from operations                1,229,726    622,830     206,356      69,525 
 
Income taxes paid                             (271,271)  (148,807)    (62,905)    (18,038) 
 
Net cash generated from operating               958,455    474,023     143,451      51,487 
activities 
 
Cash flows from investing activities 
 
Payment for property, plant and equipment     (492,592)  (182,057)                (41,870) 
                                                                     (258,175) 
 
Proceeds from disposal of property, plant       464,845      3,256     364,749         355 
and equipment 
 
Net movement in service assets                    (497)        429       (141)          51 
 
Net movement in other investments                 3,551         83       3,352          11 
 
Net movement on biological assets               (9,911)   (10,977)    (11,957)       (541) 
 
Investment income                                 1,414        796         276          43 
 
Net cash (used in) / generated from            (33,190)  (188,470)      98,104    (41,951) 
investing activities 
 
Cash flows from financing activities 
 
Net decrease in interest bearing borrowings   (434,956)  (432,018)     (3,662)     (9,518) 
 
Non-controlling interests arising from           32,606      7,925       9,266         627 
Mopani Property Development (Private) 
Limited 
 
Finance costs                                  (79,326)   (97,928)    (39,429)     (8,635) 
 
Lease payments                                   11,206          -      11,206           - 
 
Dividend paid - ordinary shareholders          (46,724)    (2,046)    (16,743)       (568) 
 
Net cash used in financing activities         (517,194)  (524,067)    (39,362)    (18,094) 
 
Net increase / (decrease) in cash and bank      408,071  (238,514)     202,193     (8,558) 
balances 
 
Cash and bank balances at the beginning of      256,255    432,348      33,006      34,175 
the year 
 
Translation of foreign entity                  (71,084)    110,657       4,617       1,646 
 
Net effect of exchange rate changes on cash    (66,196)    117,487      22,653       5,743 
and bank balances 
 
Effects of inflation adjustments              (264,577)  (165,723)           -           - 
 
Cash and bank balances at the end of the        262,469    256,255     262,469      33,006 
year 
 
*Historical cost financial results are provided only as supplementary 
information. The primary financial statements are the inflation adjusted 
results. The auditor's opinion relates only to the inflation adjusted financial 
results. 
 
NOTES TO THE ABRIDGED AUDITED FINANCIAL RESULTS 
 
1. Basis of preparation 
 
The abridged audited financial results are prepared from statutory records that 
are maintained under the historical cost basis except for biological assets and 
certain financial instruments which are measured at fair value. Historical cost 
is generally based on the fair value of the consideration given in exchange for 
assets. The historical costs have been adjusted for the effects of applying 
International Accounting Standard ("IAS") 29 - 'Financial Reporting in 
Hyperinflationary Economies' . Refer to note 2.2 for further details. 
 
2. Accounting policies 
 
Accounting policies and methods of computation applied in the preparation of 
these abridged financial results are consistent, in all material respects, with 
those used in the prior year. New applicable standards and improvements which 
became effective in the current year have been complied with. 
 
2.1 Functional and presentation currency 
 
On 22 February 2019, the Company and its subsidiaries changed their functional 
currency from the US$ to the RTGS$ following the promulgation of Statutory 
Instrument 33 of 2019 (SI 33/19). SI 33/19 prescribed exchange rates and 
treatment of foreign currency transactions which conflicted with IAS 21 - "The 
Effects of Changes in Foreign Exchange Rates". 
 
The Group opted to comply with SI 33/19 in translating foreign currency 
denominated transactions conducted from October 2018 to 22 February 2019. The 
decision to comply with SI 33/19 restricted full compliance with IAS 21. The 
Group's deviation from IAS 21 was not intentional but was necessitated by the 
requirement to comply with laws and regulations within Zimbabwe. In the current 
year, the Group has appropriately accounted for foreign currency transactions. 
However, the comparative statement of profit or loss and other comprehensive 
income and statement of cash flows have USD transactions between the period 1 
October 2018 and 22 February 2019 which were translated at a rate of US$1: 
ZWL1. 
 
2.2 Hyperinflation 
 
On 11 October 2019, the Public Accountants and Auditors Board ("PAAB") issued a 
pronouncement on the application of IAS 29. The pronouncement requires that 
entities operating in Zimbabwe with financial periods ending on or after 1 July 
2019, prepare and present financial statements in line with the requirements of 
IAS 29. 
 
The Directors have made appropriate adjustments to reflect the changes in the 
general purchasing power on the ZWL and for the purposes of fair presentation 
in accordance with IAS 29, these changes have been made on the historical cost 
financial information. Various assumptions have been made, with the significant 
assumption being the use of the consumer price indices ("CPI"), for the various 
years. Accordingly, the inflation adjusted financial statements represent the 
primary financial statements of the Group. The historical cost financial 
results are provided as supplementary information and as a result the auditors 
have not expressed an opinion on them. 
 
The source of the price indices used was the Reserve Bank of Zimbabwe website. 
Below are the indices and adjustment factors used up to 31 March 2020: 
 
                                                                                Adjustment 
                                                                        Indices     Factor 
 
CPI as at 31 March 2020                                                  810.40       1.00 
 
CPI as at 31 March 2019                                                  104.38       7.76 
 
CPI as at 1 October 2018 (for opening balances)                           64.06      12.65 
 
Average CPI 2020                                                         382.91 
 
Average CPI 2019                                                          77.18 
 
3. Going concern 
 
The Directors assess the ability of the Group to continue in operational 
existence in the foreseeable future at each reporting date. As at 31 March 
2020, the Directors have assessed the Group's ability to continue operating as 
a going concern and believe that the preparation of these financial results on 
a going concern basis is still appropriate. 
 
The Group's segments have put in place various measures to mitigate the adverse 
impact of COVID-19 pandemic to the businesses. Apart from the hospitality 
segment, the rest of the Group's segments are operating as they are classified 
as part of essential services. Their trading performance for three months to 
June 2020 is not significantly different from the period prior to outbreak of 
the pandemic. The hospitality segment closed at the end of March 2020 and its 
date of reopening remains uncertain. Both the hospitality segment and the Group 
have cash resources to fund operations for a prolonged period of care and 
maintenance. 
 
4. Audit opinion 
 
These abridged financial results should be read in conjunction with the 
complete set of financial statements for the year ended 31 March 2020, which 
have been audited by Deloitte & Touche Chartered Accountants (Zimbabwe) in 
accordance with International Standards on Auditing. The auditors issued a 
qualified opinion on the financial statements for the carryover effects of 
non-compliance with IAS 21 -'The Effects of Changes in Foreign Exchange Rates' 
from the prior year. The audit report includes a section on Key Audit Matters. 
The Key Audit Matters are on valuation of investment in Mentor Africa (Pty) 
Limited and valuation of biological assets. The auditor's report is available 
for inspection at the Company's registered address. The Engagement Partner 
responsible for the audit was Charity Mtwazi. 
 
5. Segment information 
 
                                                  INFLATION ADJUSTED       HISTORICAL COST 
 
                                                     31 Mar     31 Mar  31 Mar 2020     31 Mar 
                                                       2020       2019                    2019 
 
                                                    ZWL 000    ZWL 000      ZWL 000    ZWL 000 
 
Revenue - continuing operations 
 
Supermarkets                                      7,954,179  7,827,634    3,819,565    747,338 
 
Agriculture                                         719,593    389,051      321,456     37,015 
 
Hotels                                              198,899     96,722       79,263      9,101 
 
Corporate*                                         (37,148)   (28,083)     (18,447)    (2,626) 
 
                                                  8,835,523  8,285,324    4,201,837    790,828 
 
Profit after tax - continuing operations 
 
Supermarkets                                       674,849    (21,047)      240,262   24,788 
 
Agriculture                                        157,159     332,016      387,011   40,428 
 
Hotels                                             184,747      72,544      125,417    9,280 
 
Corporate*                                         258,200   (187,208)     (33,993)  (4,482) 
 
                                                 1,274,955     196,305      718,697   70,014 
 
Segment assets 
 
Supermarkets                                     2,550,143   2,042,532      938,668  204,081 
 
Agriculture                                      1,396,472   1,247,548      635,265  120,763 
 
Hotels                                             686,453     629,818      547,585   54,930 
 
Corporate*                                         521,980     885,188      461,025  102,353 
 
                                                 5,155,048   4,805,086    2,582,543  482,127 
 
Segment liabilities 
 
Supermarkets                                       963,254   1,163,097      593,171  108,112 
 
Agriculture                                        296,449     292,586      172,704   33,385 
 
Hotels                                             148,805     227,540      143,733   26,761 
 
Corporate*                                         136,135     593,491       73,481   61,491 
 
                                                 1,544,643   2,276,714      983,089  229,749 
 
 
*Included in the corporate revenue amount is an adjustment of ZWL62.3 million 
(2019: ZWL55.5 million); (Historical cost ZWL30 million (2019: ZWL5.2 million) 
against revenue in respect of inter-segment sales. Inter-company balances have 
been eliminated in the corporate amounts. Corporate also includes other 
operating segments that are immaterial to warrant separate disclosure. 
 
5.1 Discontinued operations 
 
 
Meikles Hotel 
 
The Group disposed of Meikles Hotel as a going concern. The disposal included 
the property, plant and equipment and transfer of employees. The disposal was 
effected on the 1st of March 2020, on which date control of the hotel passed. 
The summary of the profit / (loss) position from the discontinued operation and 
details of assets and liabilities disposed of are as set out below. 
 
Greatermans Stores 
 
The group exited the departmental stores segment during the first quarter of 
the financial year. The results of the departmental stores for the current year 
are disclosed as discontinued operations. The summary of the profit / (loss) 
position from the discontinued operation and details of assets and liabilities 
disposed of are as set out below. 
 
The prior year comparative financial information from discontinued operations 
has been re-presented to include the operations classified as discontinued in 
the current period. 
 
5.1 Discontinued operations (continued) 
 
                                             INFLATION ADJUSTED      HISTORICAL COST 
 
                                                31 Mar     31 Mar     31 Mar 31 Mar 2019 
                                                  2020       2019       2020 
 
                                               ZWL 000    ZWL 000    ZWL 000     ZWL 000 
 
Profit / (loss) for the period from 
discontinued operations 
 
Revenue                                        225,566    160,540     91,550      15,377 
 
Net operating costs                          (187,222)  (200,213)   (83,978)    (19,339) 
 
Other operating income                           6,601     10,089      3,290         563 
 
Operating profit / (loss)                       44,945   (29,584)     10,862     (3,399) 
 
Investment income                                    2         12          1           1 
 
Interest expense                               (4,206)    (7,007)    (1,273)       (198) 
 
Exchange gains                                 (9,823)    (4,821)    (2,898)       (618) 
 
Profit / (loss) on disposal of property,        74,157      (420)    330,192        (17) 
plant and equipment 
 
Net monetary adjustment                         42,558    169,440          - 
 
Profit / (loss) before tax                     147,633    127,620    336,884     (4,231) 
 
Taxation                                      (28,915)    (3,372)   (28,915)         175 
 
Profit / (loss) for the year from              118,718    124,248    307,969     (4,056) 
discontinued operations 
 
Cash flows from discontinued operations 
 
Net cash outflows from operating activities  (504,675)  (136,644)  (364,449)    (10,020) 
 
Net cash flows from investing activities       547,387    104,127    359,274           2 
 
Net cash flows from financing activities      (71,335)     39,849     12,901      12,050 
 
Net cash flows from discontinued operations   (28,623)      7,332      7,726       2,032 
 
Analysis of assets disposed of                                     INFLATION HISTORICAL 
                                                                    ADJUSTED    COST 
 
                                                                      31 Mar 31 Mar 2020 
                                                                        2020 
 
                                                                     ZWL 000     ZWL 000 
 
Non-current assets 
 
Property, plant and equipment                                      (385,401)    (31,546) 
 
Net assets disposed of                                             (385,401)    (31,546) 
 
Proceeds on disposal                                                 459,558     361,738 
 
Profit on disposal of operation                                       74,157     330,192 
 
NOTES TO THE ABRIDGED UNAUDITED FINANCIAL RESULTS 
 
                                                  INFLATION ADJUSTED     HISTORICAL COST 
 
                                                    31 Mar     31 Mar     31 Mar     31 Mar 
                                                      2020       2019       2020       2019 
 
6. Other information                               ZWL 000    ZWL 000    ZWL 000    ZWL 000 
 
Capital commitments authorised but not           1,339,413    922,167  1,339,413    118,836 
contracted for 
 
Group's share of capital commitments of joint      110,245     94,602    110,245     12,191 
operation 
 
7. Net borrowings 
 
Non-current borrowings                              29,314     95,063     29,314     12,244 
 
Current borrowings                                  30,788    399,995     30,788     51,520 
 
Total borrowings                                    60,102    495,058     60,102     63,764 
 
Cash and cash equivalents                        (262,469)  (256,255)  (262,469)   (33,006) 
 
Net (cash) / borrowings                          (202,367)    238,803  (202,367)     30,758 
 
Comprising: 
 
Secured                                             41,937    452,981     41,937     56,622 
 
Unsecured                                           18,165     42,077     18,165      7,142 
 
                                                    60,102    495,058     60,102     63,764 
 
7.1 Breach of loan covenants 
 
During the course of the current year, the Group was in default on some of its 
loan covenants with lenders. These defaults were carried over prior years. 
Subsequent to year end all past due loans were expunged. 
 
8. Implementation of IFRS 16 
 
The Group has applied the new IFRS 16 that is effective for the current year. 
The Group used the modified retrospective approach, with no adjustment to 
equity and no restatement of the comparative information. IFRS 16 allows for 
the recognition of right of use asset and lease liability and the impact of the 
adoption of IFRS 16 on the Group's consolidated financial statements is set out 
below: 
 
8.1 Right of use assets 
 
                                                INFLATION ADJUSTED      HISTORICAL COST 
 
                                              31 Mar 2020     31 Mar     31 Mar     31 Mar 
                                                                2019       2020       2019 
 
                                                  ZWL 000    ZWL 000    ZWL 000    ZWL 000 
 
Opening carrying value                                  -          -          -          - 
 
Additions                                         424,059          -     86,984          - 
 
Depreciation                                     (24,647)          -   (11,099)          - 
 
Closing carrying value                            399,412          -     75,885          - 
 
Comprising 
 
Cost                                              424,059          -     86,984          - 
 
Accumulated depreciation                         (24,647)          -   (11,099)          - 
 
                                                  399,412          -     75,885          - 
 
The Group's leases include leases of offices, retail stores and residential 
property in Zimbabwe. 
 
8.2       Lease liabilities 
 
                                               INFLATION ADJUSTED      HISTORICAL COST 
 
                                             31 Mar 2020     31 Mar     31 Mar     31 Mar 
                                                               2019       2020       2019 
 
                                                 ZWL 000    ZWL 000    ZWL 000    ZWL 000 
 
Opening balance                                        -          -          -          - 
 
Additions                                         86,984          -     86,984          - 
 
Interest expense                                  28,630          -     28,630          - 
 
Rental payments                                 (17,424)          -   (17,424)          - 
 
                                                  98,190          -     98,190          - 
 
Less current portion                             (6,663)          -    (6,663)          - 
 
Non-current portion                               91,527          -     91,527          - 
 
Maturity profile 
 
On demand                                          6,663          -      6,663          - 
 
Between one and two years                          6,446          -      6,446          - 
 
Between two and three years                        6,830          -      6,830          - 
 
Between three and four years                       8,899          -      8,899          - 
 
Between four and five years                        7,388          -      7,388          - 
 
After five years                                  61,964          -     61,964          - 
 
                                                  98,190          -     98,190          - 
 
Meikles Limited Website: www.meiklesltd.com 
 
 
 
END 
 

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