RNS Number:7721J
Kerry Group PLC
11 September 2001
KERRY GROUP PLC
Tuesday 11 September 2001
INTERIM REPORT
Half Year Ended 30 June 2001
Kerry, the global food ingredients and consumer foods group, reports
interim results for the half year ended 30 June 2001
FINANCIAL HIGHLIGHTS
* Sales increased by 5.9% to EUR1,339.7m
* Operating profit before goodwill amortisation increased by 6.5% to
EUR107.8m
* Operating margin up from 8.0% to 8.1%
* Profit before taxation increased by 9.3% to EUR78m
* Earnings per share before goodwill amortisation increased by
10.3% to EUR38.7c
* FRS3 earnings per share increased by 11.1% to EUR34.1c
* Interim dividend per share increased by 11.3% to EUR3.25c
The unaudited results and Balance Sheet of the Group as at 30 June
2001, together with comparative figures for the previous year and the
audited results to 31 December 2000, are set out in this release.
A copy of the Interim Report will be circulated to shareholders and
is available for inspection at the registered office of the company.
For further information please contact:
Frank Hayes
Director of Corporate Affairs Tel no +353 66 7182304
Fax no +353 66 7182972
Kerry Web Site: www.kerrygroup.com
KERRY GROUP PLC
CHAIRMAN'S STATEMENT
for the half year ended 30 June 2001
Results
_______
In a more demanding trading environment in the first half of 2001,
Kerry maintained its growth momentum while continuing to improve
operating margins and to invest in a range of strategic business
development initiatives throughout all Group core businesses.
Profit before tax increased by 9.3% to EUR78.0m. Earnings per share
before goodwill amortisation increased by 10.3% to EUR38.7c. Basic
FRS3 earnings per share increased by 11.1% to EUR34.1c.
Operating profits before goodwill amortisation increased by 6.5% to
EUR107.8m. Group turnover grew by 5.9% to EUR1,339.7m, reflecting
strong growth in the Americas and in Ireland and a good performance
in European and Asian markets notwithstanding production capacity
constraints and business disposals. The operating margin advanced to
8.1% compared to 8% in the same period in 2000. The result reflects
the resilience of Kerry's consumer foods brands and the quality of the
Group's global food ingredients businesses in an increasingly
competitive trading environment due to the relatively weaker
global economic situation and delayed market development
initiatives as a consequence of global food processor consolidation.
In the period under review the Group invested considerable resources
in furthering its growth objectives by broadening its global presence
and technical leadership in ingredients markets and through development
of a portfolio of new product offerings in snack and convenience
sectors of the UK and Irish consumer foods markets. This business
expansion programme, which is continuing in the second half of 2001,
has already resulted in a range of strategic bolt-on acquisitions in
flavours markets and in the fast growing nutritional ingredients
sector, as well as convenience sectors of consumer foods markets and
the foodservice sector.
Operations Reviews
__________________
Ireland and the Rest of Europe
Sales originating from Irish based operations grew by 8.4% to EUR318.5m.
Operating profit increased by 3.4% to EUR18.9m.
European operations (excluding Ireland) increased turnover by 1.9% to
EUR568.5m while operating profits increased by 6.4% to EUR40.4m. This
represents a continuation of a trend which has resulted in an increase
in first half operating profits from EUR35.5m in 1999 and EUR38.0m in
2000.
In European ingredients markets good progress was achieved through
improved operational efficiencies and solid growth in coatings and
snack market segments. Poultry markets continued to firm, providing
good opportunities for Kerry's coatings businesses throughout Europe.
The Group also continued to advance its share of quick-service
-restaurant markets. Market conditions in France and Germany improved
considerably. Progress in expanding Eastern European businesses
continued while business development in Russia produced good growth,
in particular for savoury ingredients.
Kerry Foods continued to benefit through its brand leadership
positions. Good progress was achieved in high value product areas
and the division recorded excellent results through its investment
in snack and convenience sectors and in the further development of
its prepared meals business. Market share gains in sausage, premium
meats, juices and mineral water categories were again achieved.
Americas
Turnover in American markets increased by 11.3% to EUR388.1m and
operating profits increased by 8.4% from EUR41.2m to EUR44.7m. In
the USA, as foodservice markets continue to expand, the Group again
recorded good growth in food coatings, in particular in poultry and
appetiser applications. Arising from the strong growth of hand-held
foods, Kerry successfully launched FlavorCoreTM - a patented sauce
filling cold forming extrusion technology which facilitates cost
effective production of novel combinations for appetiser, hand-held
and center-of-plate menu items. The division's sweet ingredients
business also performed well in the cereal, nutraceutical and premium
ice cream sectors. In the speciality ingredients sector, the Armour
Food ingredients business acquired prior to year-end 2000 was
successfully integrated. In Canada good progress was achieved in the
growing snack sector and through incorporation of dairy flavours and
emulsifier systems for vegetarian and soy-based cheeses. In Mexico
further advances were made in the prepared foods and snack sectors
and a new corporate headquarters for Mexico and Central America was
opened at the World Trade Center in Mexico City. In Brazil progress
continued in the snack sector and through specialty lipids
applications. Significant market development was also achieved
through meat seasonings and marinades to the growing value-added meat
industries.
Asia Pacific
Investments in new production facilities in Australia and expansion
of the Group's Malaysian manufacturing plant, which were commissioned
or near completion just prior to the end of the period under review,
meant that capacity limitations were not overcome during the half year.
This resulted in a broadly static turnover of EUR64.5m. While costs
associated with the expanding operations in the region increased,
nevertheless a slight increase in operating profits to EUR3.9m was
achieved.
In Australia, the relative weakness of the Australian dollar also
impacted on new business development. Nevertheless good progress was
achieved with quick-service-restaurant chains and with coating systems
through poultry processors. The supply of seasonings to the growing
rice snack market also grew significantly. Kerry Pinnacle expanded its
product range to in-store bakeries in major retail outlets. In March
the Group opened its expanded AU$20m processing facility at Murarrie
in Brisbane. The AU$10m upgrade of Kerry Australia's second major
processing plant at Altona, Victoria was completed in July, as was the
construction of a new AU$6.5m regional headquarters and R&D facility at
Homebush Bay, Sydney.
Kerry New Zealand again grew through promotional activity with major
foodservice chains.
While expansion of the Group's Malaysian facility at Johor Bahru was
not fully commissioned until May, significant market development
occurred in South East Asian and North East Asian markets. In the
nutritional sector, advances were achieved in infant formula and
beverage sectors. From a low base, Kerry is establishing strong
business relationships with foodservice chains in the region and
through coating systems directly through food processors.
Development
___________
Having already achieved market leadership in seasonings, coatings,
speciality ingredients and sweet ingredients, in 2001 the Group
has focused considerable financial and management resources on
capitalising on this broad food technology base through expansion
in global flavours markets and in the fast growing nutrition sector
- with particular emphasis in the areas of infant nutrition, clinical
nutrition and health promoting products. In the UK and Irish consumer
foods markets, the Group has also focused on exploiting its strong
brand equity and customer branded positions in selected categories of
the fast growing snack and convenience product sectors. During the
half year, this strategy has resulted in a range of significant
bolt-on acquisitions in such markets at a cost in the period of
EUR70.3m.
Acquisitions concluded in H1 2001 include;
- Alferi Laboratories
The acquisition of Alferi Laboratories, based in Little Chute,
Wisconsin, strengthens Kerry's position as a leading supplier of
meat seasonings to the US foodservice and prepared foods markets.
Founded in 1921, Alferi has a well established reputation for
providing innovative, customised seasonings and liquid sauce
systems for customer applications in the processed meats,
foodservice and prepared foods industries.
- Corol S.A.
The addition of Corol S.A., a specialist provider of a range of
savoury and functional ingredients based in Meaux near Paris,
represents a considerable boost to Kerry's position in the French
foodservice industry. Complementing the Kerry Jaeger range of
products, the acquisition of Corol also extends the Group's market
position into the expanding healthcare sector.
- Creative Seasonings & Spices
The acquisition of Creative Seasonings & Spices with state-of-the-art
processing and technical development facilities located in Sturtevant,
Wisconsin, strengthens Kerry's capability in development of seasoning
blends and flavour systems for application in the prepared foods,
processed meats, snack and dairy industries in the US market.
- Iowa Soy
Iowa Soy, with two production facilities located in Vinton, Iowa,
produces low-fat, low-fibre soy flour and low-fat soy grits as well
as textured soy protein for use by the health and nutritional foods
industries in the USA. The acquired business together with Kerry's
existing lines of Solnuts branded soynut products provide strong
growth opportunities through extension of the unique technologies
to other fast growing areas of the nutritional food industry.
- San Giorgio Flavors
Operating from two manufacturing facilities in Turin, Italy,
San Giorgio Flavors employs 87 people including an experienced
29-member R&D team, and has a strong record of growth and
technical achievement in the beverage,confectionery and savoury
product industries. Acquired from the Pernod Ricard Group,
San Giorgio Flavors is a leading speciality technology company in
the international flavour industry and is the leading Italian
manufacturer of food and beverage flavours, with a portfolio of
some 2,000 flavours extending to both savoury and sweet consumer
food segments. While its core market is Italy, the company has
expanded sales to 35 countries across Asian and EU markets.
- Platter Foods
The acquisition of Platter Foods, based in Sligo, represents a
strategic expansion of Kerry's consumer foods business in the
chilled salads and fresh desserts sectors of the Irish market.
Complementing Kerry's existing chilled convenience product
offerings, the acquired business will benefit through the
divisions dedicated chilled distribution network, its product
development and marketing expertise and through Kerry's broad
customer base.
- Calhoun Project
Also, the construction of a US$22m new coatings manufacturing
facility in Calhoun, Georgia, USA, to produce breaders, batters
and marinades for seafood, poultry, vegetable and other processed
food applications, is well advanced. The new facility, which will be
Kerry's fifth coatings plant in the USA, will be fully commissioned
by year end.
Post Balance Sheet Events
_________________________
In line with Kerry's growth strategy already outlined, the Group
continues to advance its development in global food ingredients
markets and in consumer foods growth sectors.
The acquisition of SPI Foods Inc. in the USA and Nutrir Products
Alimenticios S.A. in Brazil were concluded in August for a total
consideration of EUR22.4m.
SPI Foods Inc. is a leader in the development and manufacture of
specialty extruded ingredients for customised application in
ready-to-eat cereals, health and energy bars and snack foods. The
acquired business, which operates from a modern production facility
in Fremont, Nebraska, also manufactures unique microwaveable
pre-cooked pastas for foodservice and retail markets, including its
signature brand Pasta De FinoTM NoBoil(R) Lasagna.
Nutrir Products Alimenticios S.A. is a leading supplier of branded
dehydrated convenience blends to the cappuccino, breakfast cereal,
milkshake and chocolate beverage sectors in Brazil. The business,
operating from a modern manufacturing facility based in Belo
Horizonte, has well established distribution channels in industrial,
wholesale and retail markets. Having experienced rapid growth in
recent years, the business is poised for strong future growth in
this dynamic sector of the Brazilian market.
Golden Vale
On 25 June 2001, the Board of Kerry and the Board of Golden Vale
agreed terms of a recommended offer to be made by Davy Corporate
Finance on behalf of Kerry for the whole of the issued and to be
issued share capital of Golden Vale. The Offer, which comprised a
share offer and a cash alternative, together with assumed debt and
acquisition expenses, brings the estimated total cost of the
proposed transaction to EUR398m. On 13 August the Offer was
declared unconditional as to acceptances and on 21 August Kerry
Group shareholders unanimously approved the acquisition of Golden
Vale at an Extraordinary General Meeting of the Company. The Offer
is now awaiting the approval of the Minister for Enterprise,
Trade and Employment of Ireland and the Office of Fair Trading in
the UK. Completion is expected by early October.
To date valid acceptances of the Offer have been received in
respect of approximately 88% of the issued share capital of Golden
Vale. Elections in favour of the share offer represent approximately
80% of all acceptances received.
The principal business activities of the Golden Vale Group are the
production and sale of processed and natural cheeses, dairy spreads,
prepared meals, snacks, fresh milk, niche drinks, butter and milk
powders. In recent years Golden Vale has pursued a strategy of
diversifying outside its traditional dairy industry base. This
refocusing and reshaping of the Golden Vale Group has been achieved
through:
* the disposal of loss-making and other non-core businesses;
* broadening the product range by entering the high growth ready
meals sector with the acquisition of Rye Valley Foods Limited in
1998 and subsequent investment in that business;
* investing significantly in expanding and modernising manufacturing
facilities;
* commitment to new product development; and
* focusing on sales and margin growth across the Golden Vale Group.
As a result of these initiatives, Golden Vale's consumer foods
business now accounts for more than half its total sales and Golden
Vale has become a well established supplier of convenience snacks,
cheese and frozen ready meals to food retailers in the UK and Ireland.
Between 1996 and 2000, Golden Vale has grown operating profit before
goodwill amortisation and exceptional items, at a compound average
annual rate of 22%,and operating margin has improved from 2.5% to
5.3% (after restating 1996 for the impact of the change in the
accounting policies for revaluation of fixed assets).
In the year to 31 December 2000, Golden Vale reported a profit
before tax of EUR31.6m (1999 restated:EUR32.3m) on turnover of
EUR759m (1999: EUR770m). Net assets at 31 December 2000 were
EUR128m (1999 restated: EUR113.2m).
The business operates from 13 manufacturing sites in Ireland and
the UK.
The Board of Kerry believes that combining the businesses of Kerry
and Golden Vale represents an excellent business opportunity.
- The complementary nature of Kerry and Golden Vale consumer foods
portfolio and geographies uniquely positions the combined business
in fast growing sectors of European consumer foods markets.
- The proposed transaction represents a major expansion of Kerry's
prepared meals and snack products business.
- The opportunity to market Golden Vale products to a wider
customer base and distribution of Golden Vale cheese and dairy
products through Kerry's dedicated distribution network in the
UK and Ireland.
- The opportunity to add enhanced value to Golden Vale dairy raw
materials through Kerry's global food ingredients operations.
- Expansion in foodservice markets by combining Kerry and Golden
Vale foodservice and quick-service-restaurant offerings.
- The combination of Kerry and Golden Vale dairy and agribusiness
activities also provide opportunity for significant cost savings
through streamlining the product mix, restructuring of milk
assembly and through synergies in feed milling and agri-trading.
In pro-forma terms, the combined businesses for year ending 31
December 2000 had a turnover of EUR3.38 billion and earnings before
interest, tax, depreciation and amortisation (EBITDA) of EUR350m.
Finance
_______
Interest charges for the period were slightly lower at EUR22m, with
interest cover increasing from 5.9 times to 6.5 times (EBITDA).
Working capital increased by EUR114.3m compared to the year-end
2000 level. Capital expenditure amounted to EUR49.5m and the cost of
businesses acquired in the period amounted to EUR70.3m. After an adverse
translation adjustment of EUR44.4m, net Group borrowings amounted to
EUR658.6m compared to EUR569.2m at the end of the first half of 2000.
Accordingly debt to EBITDA increased from 2.1 times to 2.2 times. The
taxation charge on ordinary activities increased slightly to EUR19.2m,
with the effective tax rate reducing from 26.0% to 24.7%. The basic
weighted average number of ordinary shares in issue for the period was
172,426,880 (half year ended 30 June 2000: 172,047,213; year ended 31
December 2000:172,149,130). The diluted weighted average number of
ordinary shares in issue for the period was 173,577,567 (half year
ended 30 June 2000: 173,290,602; year ended 31 December 2000:
173,500,688).
Dividend
________
The Board has declared an interim dividend of EUR3.25c per share, an
increase of 11.3% on the 2000 interim dividend of EUR2.92c per share.
The interim dividend will be paid on 30 November 2001 to shareholders
on the record date 2 November 2001.
Euro
____
The Group is well prepared for the introduction of the Euro. Many
Group sites are already Euro compliant and the remainder will be fully
compliant by end of October 2001.
Board and Management Changes
____________________________
On 27 February 2001, the Board announced the appointment of Mr. Denis
Brosnan (currently Managing Director) to the office of Non-Executive
Chairman with effect from 1 January 2002 to succeed Mr. Michael
Hanrahan who retires as a Director and Chairman on 31 December 2001.
As also announced, Mr. Hugh Friel (currently Deputy Managing Director)
succeeds Mr. Brosnan as Managing Director of the Group with effect
from 1 January 2002.
Mr. Denis Cregan, currently Deputy Managing Director, will also
become C.E.O. for Kerry Ingredients worldwide with effect from 1
January 2002.
It has further been decided to appoint Mr. Brian Mehigan (currently
Group Controller) as Finance Director with effect from 1 January 2002.
Current Trading and Outlook
___________________________
The Group is confident of achieving its targets for the full-year.
In ingredients markets Kerry will continue to build on its core
technologies, while developing leadership positions in the flavour
and nutrition sectors. With a primary focus on snack and convenience
sectors in the Group's consumer foods markets, complemented by the
divisions strong branded positions, Kerry can exploit the forecast
significant sectoral growth opportunities.
Notwithstanding the range of bolt-on acquisitions completed in 2001
and the proposed acquisition of Golden Vale, the Group's management,
financial and operational resources are well positioned to capitalise
on complementary acquisition opportunities.
Michael Hanrahan
Chairman
11 September 2001
KERRY GROUP PLC
CONSOLIDATED PROFIT AND LOSS ACCOUNT
for the half year ended 30 June 2001
Half Year Half Year Year
Ended Ended Ended
30 June 2001 30 June 2000 31 Dec 2000
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Turnover
Continuing operations 1,339,670 1,264,755 2,621,913
_________ _________ _________
Operating profit - continuing
operations
Before goodwill amortisation 107,848 101,305 233,747
Goodwill amortisation 8,775 7,520 15,364
_______ ______ _______
Operating profit 99,073 93,785 218,383
(Profit) on sale of businesses - (193) (1,194)
(Profit)/Loss on sale of fixed
assets (876) - 744
Interest payable & similar charges 21,968 22,600 45,680
_______ _______ _______
Profit before taxation 77,981 71,378 173,153
Taxation 19,229 18,550 40,649
________ _______ ______
Profit after taxation and
attributable to ordinary
shareholders 58,752 52,828 132,504
Dividends 5,604 5,024 15,603
______ ______ _______
Retained profit for the period 53,148 47,804 116,901
====== ====== =======
Earnings per ordinary share (EURcents) - Note 2
- basic before goodwill amortisation
and exceptional items 38.7 35.1 85.6
- basic after goodwill amortisation
and exceptional items 34.1 30.7 77.0
- fully diluted after goodwill
amortisation and exceptional
items 33.8 30.5 76.4
KERRY GROUP PLC
CONSOLIDATED BALANCE SHEET
as at 30 June 2001
30 June 2001 30 June 2000 31 Dec 2000
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Fixed assets
Tangible assets 721,248 641,004 671,821
Intangible assets 345,319 262,445 290,139
_________ ________ _______
1,066,567 903,449 961,960
Current assets
Stocks 329,040 296,869 285,351
Debtors 402,764 369,756 332,035
Cash at bank and in hand 24,802 10,381 27,995
_______ _______ _______
756,606 677,006 645,381
Creditors: Amounts falling
due within one year (740,354) (612,296) (579,448)
_________ _________ _________
Net current assets 16,252 64,710 65,933
_________ _________ _________
Total assets less current
liabilities 1,082,819 968,159 1,027,893
Creditors: Amounts falling due
after more than one year (494,560) (494,107) (495,807)
Provisions for liabilities
and charges (2,851) (8,794) (3,001)
_________ _______ _______
585,408 465,258 529,085
========= ======= =======
Capital and reserves
Called-up equity share capital 21,554 21,506 21,553
Capital conversion reserve fund 340 340 340
Share premium account 193,690 190,694 193,651
Profit and loss account 346,523 229,137 289,470
________ ________ ________
562,107 441,677 505,014
Deferred income 23,301 23,581 24,071
_______ ________ ________
585,408 465,258 529,085
======= ======== ========
KERRY GROUP PLC
CONSOLIDATED CASH FLOW STATEMENT
for the half year ended 30 June 2001
Half Year Half Year Year
Ended Ended Ended
30 June 2001 30 June 2000 31 Dec. 2000
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Operating profit before
goodwill amortisation 107,848 101,305 233,747
Depreciation (net) 34,699 32,665 62,422
Change in working capital (114,321) (68,423) 14,750
Exchange translation adjustment 2,115 (770) (1,945)
__________ _________ ________
Net cash flow from
operating activities 30,341 64,777 308,974
Return on investments and
servicing of finance (21,141) (23,485) (47,584)
Taxation (17,927) (21,778) (42,107)
Capital expenditure
Purchase of tangible fixed assets (49,446) (46,882) (100,837)
Proceeds on sale of fixed assets 3,135 756 3,425
Development grants received - - 1,733
Purchase of intangible fixed assets - - (45)
Acquisitions and disposals
Purchase of subsidiary
undertakings (70,264) (72,337) (115,619)
Proceeds on the sale of businesses - 104,876 97,732
Deferred creditors paid (16) (2,407) (1,867)
Exceptional restructuring costs - (2,674) (6,810)
Issue of share capital 40 - 3,004
Equity dividends paid (10,570) (9,170) (14,203)
________ _______ ________
Cash (outflow)/inflow
before the use of liquid
resources and financing (135,848) (8,324) 85,796
Financing
Increase/(decrease) in
debt due within one year 177,343 5,444 (30,820)
Decrease in debt due after
one year (44,688) - (40,242)
________ _______ ________
(Decrease)/increase in
cash in the period (3,193) (2,880) 14,734
======== ======= ========
KERRY GROUP PLC
RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
for the half year ended 30 June 2001
Half Year Half Year Year
Ended Ended Ended
30 June 2001 30 June 2000 31 Dec. 2000
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
(Decrease)/increase in
cash in the period (3,193) (2,880) 14,734
Cash flow from debt financing (132,655) (5,444) 71,062
_________ ________ ________
Change in net debt
resulting from cash flows (135,848) (8,324) 85,796
Exchange translation adjustment (44,386) (16,383) (19,611)
_________ ________ ________
Movement in net debt in the
period (180,234) (24,707) 66,185
Net debt at beginning of
period (478,347) (544,532) (544,532)
_________ _________ _________
Net debt at end of period (658,581) (569,239) (478,347)
========= ========= =========
KERRY GROUP PLC
STATEMENT OF TOTAL RECOGNISED GAINS AND LOSSES
for the half year ended 30 June 2001
Half Year Half Year Year
Ended Ended Ended
30 June 2001 30 June 2000 31 Dec. 2000
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Profit attributable to
ordinary shareholders 58,752 52,828 132,504
Exchange translation adjustment on
foreign currency net investments 3,905 (8,510) (17,274)
_______ ________ _________
Total recognised gains and losses
relating to the period 62,657 44,318 115,230
======= ======== =========
KERRY GROUP PLC
RECONCILIATION OF MOVEMENT IN SHARE CAPITAL AND RESERVES
for the half year ended 30 June 2001 (Unaudited)
Share Capital Profit &
Capital Conversion Loss
& Premium Reserve Fund Account Total
EUR'000 EUR'000 EUR'000 EUR'000
At beginning of period 215,204 340 289,470 505,014
Retained profit - - 53,148 53,148
Share issue 40 - - 40
Exchange translation
adjustment - - 3,905 3,905
_________ ____ ________ _______
At end of period 215,244 340 346,523 562,107
========= ==== ======== =======
The Profit & Loss Account figures comprise the following:
Intangible Profit &
Assets Retained Loss
Written Off Profits Account
EUR'000 EUR'000 EUR'000
At beginning of period (414,931) 704,401 289,470
Retained profit (8,775) 61,923 53,148
Exchange translation
adjustment - 3,905 3,905
_________ _______ _______
At end of period (423,706) 770,229 346,523
========= ======= =======
The exchange translation adjustment arises on the retranslation of the
Group's opening net investment in its overseas subsidiaries.
KERRY GROUP PLC
NOTES TO THE INTERIM REPORT
for the half year ended 30 June 2001
1 Analysis of results by region
_____________________________
Half Year Ended Half Year Ended Year Ended
30 June 2001 30 June 2000 31 Dec. 2000
Operating Operating Operating
Turnover Profit Turnover Profit Turnover Profit
Unaudited Unaudited Unaudited Unaudited Audited Audited
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
By geographical market of origin:
Ireland 318,525 18,870 293,846 18,249 645,874 37,306
Rest of
Europe 568,500 40,396 558,148 37,971 1,140,934 91,900
Americas 388,127 44,697 348,688 41,230 703,869 92,422
Asia Pacific 64,518 3,885 64,073 3,855 131,236 12,119
__________ _______ _________ _______ _________ _______
1,339,670 107,848 1,264,755 101,305 2,621,913 233,747
Goodwill
amortisation - (8,775) - (7,520) - (15,364)
_________ ________ _________ ______ _________ ________
1,339,670 99,073 1,264,755 93,785 2,621,913 218,383
========= ======== ========= ====== ========= ========
Turnover Turnover Turnover
EUR'000 EUR'000 EUR'000
By destination:
Ireland 221,655 209,610 418,261
Rest of
Europe 634,665 617,375 1,274,588
Americas 402,924 357,613 768,613
Asia Pacific 80,426 80,157 160,451
__________ _________ _________
1,339,670 1,264,755 2,621,913
========== ========= =========
Turnover and operating profit as presented above, are stated net of
intra Group transactions.
2. Earnings Per Share
_____________________
Half Year Ended Half Year Ended Year Ended
30 June 2001 30 June 2000 31 Dec. 2000
EPS EPS EPS
Unaudited Unaudited Unaudited Unaudited Audited Audited
EURcents EUR'000 EURcents EUR'000 EURcents EUR'000
Profit after taxation
before goodwill &
exceptional items 38.7 66,651 35.1 60,348 85.6 147,418
Goodwill amortisation 5.1 8,775 4.4 7,520 8.9 15,364
Exceptional items(net) (0.5) (876) - - (0.3) (450)
_____ ______ ____ ______ ____ _______
Profit after taxation
goodwill amortisation
& exceptional items 34.1 58,752 30.7 52,828 77.0 132,504
===== ======= ==== ====== ==== =======
Share option dilution 0.3 - 0.2 - 0.6 -
______ ______ ____ ______ ____ _______
33.8 58,752 30.5 52,828 76.4 132,504
====== ====== ==== ====== ==== =======
The basic weighted average number of ordinary shares in issue for
the period was 172,426,880 (half year ended 30 June 2000:
172,047,213; year ended 31 December 2000: 172,149,130). The diluted
weighted average number of ordinary shares in issue for the period
was 173,577,567 (half year ended 30 June 2000:173,290,602; year
ended 31 December 2000: 173,500,688). The dilution arises
in respect of executive share options outstanding.
In addition to the basic and diluted earnings per share, a pre
goodwill amortisation and exceptional items earnings per share
calculation is also provided, as it more accurately reflects the
Group's underlying trading performance.
3. Businesses Acquired
______________________
The Group completed a number of acquisitions during the period at a
total cost of EUR70.3m.
Alferi Laboratories, a seasonings business based in Little Chute,
Wisconsin, was acquired in May 2001. The business, whose products
include meat seasonings, dough concentrates and spices, has
approximately 60 full-time employees.
The acquisition of Corol S.A., a company based in Meaux, France,
which provides a range of savoury and functional ingredients,
was completed in March 2001. Corol, which has sales to a number
of large contract caterers, employs in excess of 25 people.
Creative Seasonings & Spices, a seasonings business with
state-of-the-art processing and technical development facilities
located in Sturtevant, Wisconsin, was acquired in February 2001.
It operates primarily in the processed meats, snack and dairy
and prepared foods markets.
The purchase of Iowa Soy, with two production facilities located
in Vinton, Iowa producing low-fat, low-fibre soy flour and low-fat
soy grits as well as textured soy protein for use by the health
and nutritional food industries in the US, was completed in May 2001.
San Giorgio Flavors SpA, a flavours company with manufacturing
facilities in Turin and Druento, Italy was acquired in June 2001
from the Pernod Ricard Group. While its core market is Italy, it
has also expanded sales overseas to 35 countries across Asian
and EU markets, with products ranging from sweet liquid flavours to
emulsions for beverages.
Platter Foods Ltd, a Sligo based company operating primarily in
the ready meals and chilled salads and fresh desserts sector of
the Irish market, was acquired in May 2001.
4. Post Balance Sheet Events
____________________________
The Group has substantially completed the acquisition of the
Golden Vale plc group at an estimated cost, including assumed
debt and acquisition expenses, of EUR398m. The acquisition has
been approved by both the shareholders of Kerry and Golden Vale
and is currently awaiting clearance from the Minister for
Enterprise, Trade and Employment of Ireland and the Office of
Fair Trading in the UK. Golden Vale is a leading player in some
of Europe's fastest growing food sectors including frozen ready
meals, cheese snacks and sliced cheese for the catering markets as
well as consumer and industrial sectors and has 13 manufacturing
sites in Ireland and the UK.
The acquisition of SPI Foods Inc., whose operations are based
in Fremont, Nebraska was finalised in August 2001. The company
is engaged in the development and manufacture of specialty
extruded pasta,multi-grain products and health food
supplements and has in excess of 70 employees.
Nutrir Productos Alimenticios S.A., a business with manufacturing
facilities in Belo Horizonte, MG, Brazil and supplying convenience
blends to the beverage sector, was purchased in August 2001.
5. Accounting Policies
______________________
These accounts have been prepared using the same accounting policies
detailed in the 2000 annual financial statements.
6. Interim Accounts
___________________
These accounts are not full accounts and except where indicated are
unaudited. Full accounts to 31 December 2000, which received an
unqualified audit report, have been filed with the Registrar of
Companies.
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