TIDMKYGA
RNS Number : 4899M
Kerry Group PLC
17 August 2011
Wednesday 17 August 2011
Interim Management Report
for the half year ended 30 June 2011
Kerry, the global ingredients & flavours and consumer foods
group, reports interim results for the half year ended 30 June
2011
Highlights
-- Adjusted* EPS up 9.7% to 86.8 cent -- Sales revenue increased by
8.4% (LFL) to EUR2.6 billion -- 3.6% volume growth and raw
material/input cost inflation substantially recovered -- Trading profit
increased by 6.1% (LFL) to EUR214m -- Group trading margin down 30bps
despite strong underlying margin performance -- Interim dividend per
share increased by 11.4% to 9.8 cent -- Free cash flow of EUR48m (H1
2010: EUR117m) *before acquisition related intangible asset
amortisation and non-trading items
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Commenting on the results Kerry Group Chief Executive Stan
McCarthy said; "Kerry delivered a solid earnings performance and
strong volume growth in the first half of 2011, despite significant
raw material and input cost inflation. The Group remains confident
of achieving its growth targets for the full year and delivering
eight to twelve per cent growth in adjusted earnings per share as
guided at the beginning of the year".
Contacts:
Media Frank Hayes, Director of Investor Relations Brian
Corporate Affairs Tel: +353 66 Mehigan, Chief Financial
7182304 Email: Officer Michael Ryan, Head of
corpaffairs@kerry.ie Kerry Web Investor Relations Tel: +353 66
Site: www.kerrygroup.com 718 2253 Email:
investorrelations@kerry.ie
-------------------------------------- --------------------------------------
INTERIM MANAGEMENT REPORT
for the half year ended 30 June 2011
Kerry delivered strong volume growth and a solid earnings
performance in the first half of 2011 despite significant raw
material and input cost inflation. Against a strong first half
comparative in 2010, the overall half-year performance was
satisfactory across all regions notwithstanding the continuing
economic challenges and restrained consumer spending in some key
markets. Group cost recovery and business efficiency programmes
proved highly effective and where raw material inflationary trends
have continued pricing actions will continue to be taken in
collaboration with customers. Ingredients & Flavours grew
volumes ahead of the market in all regions due to successful
layering of Group technologies and focused end-use-market
innovation. Encouraging growth was maintained in developing
markets. While the Irish and UK consumer foods markets remain
highly competitive with heavy promotional activity which delayed
input cost recovery, Kerry's leading brands maintained good growth
in the UK market and stabilised market shares in Ireland.
Results
Group sales revenue increased to EUR2.6 billion, reflecting
like-for-like (LFL) growth of 8.4%. Business volumes grew by 3.6%
with product pricing/mix increasing by 5%. Raw material costs
during the period increased by 11% relative to the prior year
level. Ingredients & Flavours volumes grew by 4.1% and Consumer
Foods achieved 2% business volume growth.
Trading profit increased by 6.1% (LFL) to EUR214m.
Notwithstanding the significant increase in raw material and input
costs, Ingredients & Flavours maintained a trading margin of
9.2%. A lag in cost recovery due to the competitiveness of the UK
and Irish consumer foods sectors meant that the Consumer Foods
divisional trading margin at 6.8% was 30 basis points lower than
the same period of 2010 despite gains made through business
efficiency programmes. While the underlying Group business trading
margin increased significantly, the reported trading margin reduced
by 30 basis points due to the impact of cost recovery and central
costs relating to the ongoing 1 Kerry business transformation and
global IT project ("Kerryconnect").
Profit before tax increased to EUR175m from the 2010 first half
level of EUR162m. Profit after tax increased by 9% to EUR144m.
Adjusted earnings per share increased by 9.7% to 86.8 cent. Basic
earnings per share increased by 8.7% to 82.2 cent. The interim
dividend of 9.8 cent per share represents an increase of 11.4% over
the 2010 interim dividend.
Business Reviews
Ingredients & flavours
H1 2011 Like-for-like (LFL) Growth
Revenue EUR1,973m 9.6%
Trading profit EUR181m 9.7%
Trading margin 9.2% Unchanged
---------------------- ---------------- ---------------------------------
Ingredients & Flavours revenue increased on a reported basis
by 10.4% to EUR1,973m, reflecting 9.6% (LFL) growth. The Group's
integrated technology approach and end-use-market focus continued
to deliver a strong innovation pipeline - contributing 4.1%
business volume growth in the period.
Trading profit grew by 9.7% (LFL) to EUR181m maintaining the
division's 9.2% trading margin despite the impact of significant
raw material and input cost increases. Food and beverage
consumption trends continue to increase demand for reduced calorie,
reduced salt, all-natural solutions and clean product labelling -
providing increased opportunities for Kerry to capitalise on its
global leadership in development and delivery of consumer preferred
taste solutions.
Americas Region
Revenue in the Americas region increased by 9.8% (LFL) to
EUR762m. Business volumes grew by 3.9% despite challenging market
conditions in some industry sectors. Against a background of
significant input cost inflation, cost recovery programmes proved
successful, contributing a 5.9% increase in pricing/mix.
Savoury & Dairy systems & flavours achieved a strong
performance across North American and Latin American
end-use-markets. Despite challenging meat industry sectoral issues,
Kerry's flavour development capabilities particularly through
coatings systems achieved excellent results. Dairy systems saw
continued growth in the yoghurt and smoothies markets. Dallas based
CF Chefs acquired prior to year-end achieved a strong performance -
strengthening Kerry's culinary expertise and development
capability.
Cereal & Sweet technologies were impacted by the increased
competitiveness of the cereal and ice-cream sectors where volumes
were slightly adverse due to delayed product launches. However the
bakery sector maintained strong innovative trends providing good
growth opportunities for Kerry's portfolio of bio-ingredients,
shelf-life extenders, flavours and functional ingredients. The
Group continued to strengthen its market positioning in Latin
American cereal and nutrition markets through establishment of
production facilities in Mexico and Brazil. In June the acquisition
of Argentina based General Cereals S.A. was completed providing
additional manufacturing and extrusion capability in the
region.
Beverage systems & flavours continued to record strong
growth through foodservice applications and Kerry's branded
portfolio. Agilex Flavors acquired in October 2010 has performed
well particularly in wellness and nutritional beverage sectors.
Foodservice chains continued to provide strong product development
opportunities for Kerry's speciality beverage applications.
California based Caffe D' Amore, also acquired prior to year-end,
provided a solid additional growth platform for Kerry technologies
through its gourmet beverage applications for foodservice and
speciality retail outlets.
The Group continued to advance its positioning in the global
pharmaceutical sector through its excipient products range and
media optimisation products in the cell nutrition sector. Ongoing
expansion of Kerry's global pharma customer service and commercial
infrastructure continues to achieve encouraging results especially
in India, China and Brazil.
EMEA Region
Ingredients & Flavours revenue in the EMEA region increased
by 9.3% (LFL) to EUR653m. Business volumes grew by 2.9%
notwithstanding sector related issues particularly in Eastern
European markets. Input cost inflation was overcome through cost
recovery programmes in collaboration with customers across all
end-use-markets. Overall pricing/mix increased by 6.4% in the
period.
Savoury & Dairy systems & flavours performed well
overall but performance varied across end-use-markets and regional
markets due to the cost pressures arising from raw material
pricing. Dairy flavours recorded growth in dairy and ice-cream
applications while the bakery sector provided good growth for the
Beatreme(TM) range of dairy systems and cultured ingredients.
Cheese flavourings achieved strong growth in sauce and snack
applications. Capacity investment in culinary systems &
flavours in addition to the UK based SpringThyme Oils Ltd
acquisition in 2010 supported good volume growth through sauce
systems. Technology development in this sector continued to support
customer demand for solutions offering lower sodium, more
authenticity in taste and cleaner ingredient declarations. Meat
systems and flavours performed well in the UK but lower red meat
consumption in Eastern Europe impacted demand for seasonings and
functional ingredients. However the poultry segment continued to
provide solid growth opportunities driven by strong retail and QSR
demand.
Cereal & Sweet technologies performed well in EMEA markets
in particular in added-value segments of the yoghurt, ice-cream,
confectionery and bakery sectors. Demand for indulgence
applications in the fine bakery and desserts markets was impacted
by weakening consumer demand. Kerry technologies performed well in
the EMEA ready-to-eat cereals market despite the level of
competition in the retail marketplace.
Beverage systems & flavours again benefited from increased
demand for natural flavours and an expansion of Kerry's market
presence in EMEA markets. Accelerating demand for calorie reduction
in the beverage sector provided excellent growth opportunities for
Kerry's recently launched fmt(TM) flavour modulation
technology.
Functional ingredients including enzymes and emulsifiers
delivered good volume growth across all key end-use-markets -
benefiting from Kerry's 'go-to-market' integrated approach to
market development.
Primary Dairy markets benefited from strong international demand
conditions during the half-year. Pricing increased in line with
strong demand from key importing countries and a relatively tighter
supply position in the early months of the year.
Asia-Pacific Region
Kerry again successfully progressed market development across
all end-use-markets in the Asia-Pacific region despite the impact
of the natural disaster events in Japan, Australia and New Zealand
early in the year. Revenue increased by 12.8% (LFL) to EUR293m.
Business volumes increased by 10% and pricing increased by 4% in
response to the raw material inflationary impact. Cost recovery
continues where inflationary trends have prevailed.
Savoury & Dairy applications achieved good volume growth
particularly in the expanding QSR segment. Meat technology systems
achieved good growth in Australia and New Zealand. EBI Cremica was
acquired during the period providing a platform for growth through
food coating systems in the food processing and foodservice sectors
in India. Lipid systems delivered strong volume growth in
particular in Vietnam and Indonesia and cost recovery continues in
the sector. Kerry continues to outperform market growth rates in
the infant nutrition sector in North East Asia. Culinary systems
also performed well - benefiting from the Malaysia based KMC Foods
acquisition completed prior to year-end 2010.
Sweet technologies continued to grow satisfactorily in the
bakery sector. Despite a shift in demand towards value propositions
in the lifestyle bakery sector in Australia, Kerry Pinnacle grew
successfully through product launches providing in-store solutions
to meet consumer requirements. The Van den Bergh's and Croissant
King branded bakery businesses acquired prior to year-end performed
well with expanded distribution through the Kerry sales
network.
Beverage systems maintained double digit growth through the
regional QSR sector.
Functional ingredients grew strongly, leveraging market
opportunities through Kerry's 'go-to-market' strategy.
Consumer Foods
H1 2011 Like-for-like (LFL) Growth
Revenue EUR944m 5.3%
Trading profit EUR64m 6.0%
Trading margin 6.8% -30bps
---------------------- -------------- ---------------------------------
The UK and Irish consumer foods markets remain challenging as
retail competition continues to drive deeper and wider promotional
activity. However Kerry Foods' brands in the UK market continued to
grow satisfactorily and the division's Irish brand shares have
stabilised. Divisional revenue grew by 5.3% (LFL) to EUR944m.
Overall business volumes increased by 2%, reflecting 3% volume
growth in the UK and a decline of 1% in Ireland. Trading profit
grew by 6% (LFL) to EUR64m. Despite strong gains through ongoing
business efficiency programmes, the impact of a delay in cost
recovery particularly in private label market segments meant that
the divisional trading margin was 30 basis points lower at
6.8%.
In Kerry Foods' UK Brands chilled foods market, all brands grew
market share. Performance in added-value meat product categories
was particularly strong. In the sausage sector Richmond again
achieved double digit growth. Wall's continued to achieve good
growth in the pastry sector and Mattessons maintained strong growth
in the meat snacks category. Cheestrings also grew market share in
the cheese snack sector.
While UK Customer Brands market segments remain highly
competitive resulting in a delay in raw material cost recovery,
Kerry achieved a satisfactory performance in the division's
selected market niches. In the chilled ready meals marketplace
Kerry Foods again outperformed market growth rates driven by
successful new product launches. The frozen meals category has
stabilised and Kerry recorded encouraging growth in the sector.
Headland Foods acquired in January is performing in line with
expectations. The acquisition has been referred by the OFT to the
Competition Commission for further investigation.
The consumer foods market in Ireland remains intensely
competitive as shoppers remain focussed on value/promotional offers
and total basket/household expenditure. Private label and
'Discounter' sales continue to increase. Kerry's Brands Ireland
business has stabilised market shares but business margins were
impacted by a lag in cost recovery in some categories.
Financial review
Reconciliation of adjusted* earnings % H1 2011 H1 2010
to profit after taxation Change EURm EURm
Continuing Operations
Revenue 8.4% (LFL) 2,650.0 2,421.4
Trading profit 6.1% (LFL) 213.6 203.8
Trading margin 8.1% 8.4%
Computer software amortisation (1.9) (2.0)
Finance costs (net) (28.2) (33.7)
Adjusted* profit before taxation 9.1% 183.5 168.1
Income taxes (excluding non-trading
items) (31.1) (29.5)
Adjusted* earnings after taxation 9.9% 152.4 138.6
Acquisition related intangible
asset amortisation (5.7) (6.0)
Non-trading items (net of related
tax) (2.3) (0.2)
Profit after taxation and attributable
to
equity shareholders 9.0% 144.4 132.4
EPS EPS
cent cent
Adjusted* earnings per share 9.7% 86.8 79.1
Acquisition related intangible
asset amortisation (3.3) (3.4)
Non-trading items (net of related
tax) (1.3) (0.1)
Basic earnings per share 8.7% 82.2 75.6
* Before acquisition related intangible asset amortisation and
non-trading items
Analysis of Results
Group revenue increased by 8.4% (LFL) and 9.4% on a reported
basis when account is taken of adverse reporting currency (-1.5%)
and the positive impact of business acquisitions net of disposals
(+2.5%).
While Group trading profits before Kerryconnect costs increased
by 9.6% this reduces to 6.1% (LFL) when account is taken of the
additional EUR7m expenditure in the period taken centrally in
relation to the Kerryconnect project. Trading profit increased by
4.8% on a reported basis allowing for the negative impact of
reporting currency (-1.7%) and the positive contribution from
business acquisitions net of disposals (+0.4%).
The Group trading margin decreased by 30 basis points to 8.1%
(H1 2010: 8.4%) in the period. Excluding the impact of cost
recovery pricing (-60bps), acquisitions/disposals (-20bps),
currency movements (-10bps), and the impact of expenditure on
Kerryconnect (-20bps), the Group's underlying trading margin
increased by 80 basis points reflecting strong margin improvement
due to operational leverage and business efficiency programmes.
The negative impact of cost recovery pricing (-60bps) consists
of -20bps due to a time lag in recovery and -40bps due to the
arithmetical effect which cost recovery pricing has on the trading
margin calculation (the "denominator effect"). The denominator
effect in Ingredients and Flavours was -50bps and in Consumer Foods
it was -20bps.
Finance Costs
Finance costs for the period decreased by EUR5.5m to EUR28.2m
(H1 2010: EUR33.7m) due to lower interest rates and lower average
borrowings.
Taxation
The tax charge for the period was EUR31.1m (H1 2010: EUR29.5m)
which represents an effective tax rate of 17.5% (H1 2010: 18.2%).
The decrease in the effective tax rate is primarily due to
variations in the geographical split of profits earned and changes
in local statutory tax rates.
Adjusted Earnings Per Share
At Kerry's Capital Markets Day held in June 2011, the Group
announced that it had changed the calculation basis for adjusted
earnings per share. Historically adjusted earnings per share has
been calculated after adding back all intangible asset amortisation
(including software amortisation). From 2011 computer software
amortisation will no longer be included in the amortisation
add-back and will therefore be treated as a cost in calculating
adjusted earnings per share. This change is due to the significance
of the Kerryconnect project that the Group is currently
undertaking. Adjusted earnings per share for the prior period has
been calculated and re-presented on this new basis.
Free Cash Flow
The Group achieved a free cash flow of EUR48m (H1 2010: EUR117m)
which is stated after net capital expenditure of EUR60m (H1 2010:
EUR41m) and working capital outflow of EUR85m (H1 2010: EUR26m).
The increase in working capital is driven by the impact of
commodity cost inflation.
H1 2011 H1 2010
Free Cash Flow EURm EURm
EBITDA*
Movement in working capital 268.8 255.5
Pension contributions paid less (85.2) (26.2)
pension expense (15.8) (14.3)
Net investment in non-current assets (59.6) (41.3)
Finance costs paid (net) (25.6) (24.1)
Income taxes paid (34.8) (33.1)
------------------------------------------ -------- --------------------
Free cash flow 47.8 116.5
------------------------------------------ -------- --------------------
* Earnings before finance costs, income taxes, depreciation,
intangible asset amortisation and non trading items (net of related
tax)
Financial Position
At 30 June 2011 net debt stood at EUR1,088m, a decrease of
EUR24m relative to the December 2010 position. In April 2011 the
Group completed a new 5 year EUR1 billion revolving credit facility
with an international syndicate of banks which provides a line of
credit until April 2016 and significantly extends the available
facilities to the Group. The period end maturity profile of drawn
Group debt was 5.4 years (H1 2010: 5.2 years, Dec 2010: 4.8
years).
At the period end 44% of debt was carried at fixed rates and the
weighted average period for which rates were fixed was 3.7
years.
At 30 June the key financial ratios were as follows;
Covenant H1 2011 H1 2010
TIMES TIMES
Net debt: EBITDA* Maximum 3.5 1.7 2.2
EBITDA: Net interest* Minimum 4.75 11.6 8.2
--------------------------------------- ----------- -----------------
* Calculated in accordance with lenders' facility agreements
The Group's balance sheet is in a healthy position and with a
net debt to EBITDA* ratio of 1.7 times, the increased facilities
provided by the revolving credit facility and the extension of the
maturity profile of Group debt, the organisation has sufficient
headroom to support its future growth plans.
Retirement Benefits
At the balance sheet date, the net deficit for all defined
benefit schemes (after deferred tax) was EUR130m (H1 2010: EUR212m,
Dec 2010: EUR145m). The decrease since the 2010 year end primarily
reflects a decrease in estimated liabilities caused by an increase
in the discount rate based on corporate AA bond rates.
Acquisitions
The Group completed a number of bolt on acquisitions during the
period in a number of geographic markets including the USA, UK,
India and Argentina at a total cost of EUR40m. The acquisition of
Headland Foods announced in January 2011 is currently being
reviewed by the Competition Commission.
related party transactions
There were no changes in related party transactions from the
2010 Annual Report that could have a material effect on the
financial position or performance of the Group in the first half of
the year.
PrincipaL RISKS & uncertainties
Details of the principal risks and uncertainties facing the
Group can be found in the 2010 Annual Report on pages 60 and 61.
These risks include but are not limited to; competition risk, a
slow down in the rate of innovation, operational and technical
compliance risks, the loss of a critical manufacturing facility and
the execution of a value destroying acquisition. However,
fluctuating raw material costs and volatile currencies, remain the
most likely to affect the Group in the second half of the year. The
Group actively manages these and all other risks through its
control and risk management processes.
dIVIDEND
The Board recommends an interim dividend of 9.8 cent per share
(an increase of 11.4% on the 2010 interim dividend) payable on 11
November 2011 to shareholders registered on the record date 14
October 2011.
post balance sheet events
Since the period end the Group has entered into exclusive
discussions with Cargill, which may or may not result in the
Group's acquisition of Cargill's global flavours business. Cargill
Flavor Systems has well established international flavour
technology development expertise serving a global customer base
through provision of flavour ingredients and flavour systems for
beverage, dairy, sweet and savoury applications. Through its
network of modern integrated flavour development and application
centres spanning 22 countries in North and South America, Europe,
South Africa and Asia, Cargill Flavor Systems has long-standing
relationships with leading global food and beverage
manufacturers.
future prospects
Kerry's customer-centric business model has continued to
strengthen our commercial alliances notwithstanding the challenges
arising from the inflationary raw material and input cost
environment. The innovation pipeline from our industry leading
technologies augurs well for the future growth and development of
the Group's Ingredients & Flavours business in developed and
developing markets. Kerry Foods' brand investment and ongoing
business efficiency programmes will continue to consolidate the
division's leadership in the UK and Irish chilled foods
markets.
The Group remains confident of achieving its growth targets for
the full year and delivering eight to twelve per cent growth in
adjusted earnings per share as guided at the beginning of the
year.
RESPONSIBILITY STATEMENT
The Directors are responsible for preparing the Half Yearly
Financial Report in accordance with the Transparency (Directive
2004/109/EC) Regulations 2007 of Ireland (S.I. No. 277 of 2007)
("the Regulations"), the Transparency Rules of the Central Bank of
Ireland and with IAS 34 "Interim Financial Reporting" as adopted by
the European Union.
The Directors confirm that to the best of their knowledge:
-- the Group Condensed Consolidated Interim Financial Statements
for the half year ended 30 June 2011 have been prepared in
accordance with the international accounting standard applicable to
interim financial reporting adopted pursuant to the procedure
provided for under regulations 5, 6, 7 and 8 of the Regulations and
Article 6 of the Regulation (EC) No. 1606/2002 of the European
Parliament and of the Council of 19 July 2002, and give a true and
fair view of the assets, liabilities, financial position and profit
or loss of the Group for the half year ended 30 June 2011;
-- the Interim Management Report includes a fair review of the
development and performance of the business and the position of the
Group;
-- the Interim Management Report includes a fair review of the
important events that have occurred during the first six months of
the financial year, and their impact on the Group Condensed
Consolidated Interim Financial Statements for the half year ended
30 June 2011, and a description of the principal risks and
uncertainties for the remaining six months;
-- the Interim Management Report includes a fair review of the
related party transactions that have occurred during the first six
months of the current financial year and that have materially
affected the financial position or the performance of the Group
during that period, and any changes in the related parties'
transactions described in the last Annual Report that could have a
material effect on the financial position or performance of the
Group in the first six months of the current financial year.
On behalf of the board
Stan McCarthy Brian Mehigan
Chief Executive Chief Financial Officer
16 August 2011
results for THE half YEAR ENDED 30 june 2011
Kerry Group plc
Condensed Consolidated Income Statement
for the half year ended 30 June 2011
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Continuing operations
Revenue 1 2,649,969 2,421,428 4,960,003
_________ _________ _________
Trading profit 1 213,572 203,797 470,216
Intangible asset amortisation (7,626) (7,994) (16,065)
Non-trading items 2 (2,530) 163 (815)
_________ _________ _________
Operating profit 203,416 195,966 453,336
Finance income 391 501 945
Finance costs (28,589) (34,203) (61,446)
_________ _________ _________
Profit before taxation 175,218 162,264 392,835
Income taxes (30,855) (29,842) (68,618)
_________ _________ _________
Profit after taxation and
attributable to equity
shareholders 144,363 132,422 324,217
_________ _________ _________
Earnings per A ordinary share Cent Cent Cent
- basic 3 82.2 75.6 185.0
- diluted 3 82.2 75.4 184.7
_________ _________ _________
Kerry Group plc
Condensed Consolidated Statement of Recognised Income and Expense
for the half year ended 30
June 2011
Half year Year
Half year ended ended
ended 30 June 31 Dec.
30 June 2011 2010 2010
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Profit for the period after
taxation 144,363 132,422 324,217
Other comprehensive
income/(expense):
Fair value movements on
available-for-sale
investments 6 - 4,190 -
Fair value movements on cash
flow hedges 9,576 (664) 21,914
Exchange difference on
translation of foreign
operations 10 (47,511) 90,017 57,295
Actuarial losses on defined
benefit post-retirement
schemes (336) (86,524) (30,268)
Deferred tax on items taken
directly to reserves 5 (1,905) 16,155 2,015
_________ _________ _________
Net (expense)/income
recognised directly in
other comprehensive income (40,176) 23,174 50,956
Reclassification to profit
or loss from equity:
Cash flow hedges (6,159) 3,894 1,228
Available-for-sale
investments 6 - 3,213 7,403
_________ _________ _________
Total comprehensive income 98,028 162,703 383,804
_________ _________ _________
Kerry Group plc
Condensed Consolidated Balance Sheet
as at 30 June 2011
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Non-current assets
Property, plant and equipment 1,073,881 1,076,601 1,107,164
Intangible assets 1,949,777 1,987,025 1,998,868
Financial asset investments 8,215 15,692 8,215
Non-current financial instruments 9 17,399 87,901 42,680
Deferred tax assets 10,598 13,182 8,928
__________ ___________ ___________
3,059,870 3,180,401 3,165,855
__________ ___________ ___________
Current assets
Inventories 637,264 522,376 531,561
Trade and other receivables 710,025 696,151 618,727
Cash and cash equivalents 9 90,897 162,993 159,340
Other current financial instruments 4,307 45 4,684
Assets classified as held for sale 4,991 5,212 5,386
__________ ___________ ___________
1,447,484 1,386,777 1,319,698
__________ ___________ ___________
Total assets 4,507,354 4,567,178 4,485,553
__________ ___________ ___________
Current liabilities
Trade and other payables 1,129,629 1,110,033 1,017,912
Borrowings and overdrafts 9 41,554 49,135 181,286
Other current financial instruments 293 24,778 12,206
Tax liabilities 26,272 20,051 34,357
Provisions for liabilities and charges 15,801 21,507 18,342
Deferred income 3,037 2,390 2,514
__________ ___________ ___________
1,216,586 1,227,894 1,266,617
__________ ___________ ___________
Non-current liabilities
Borrowings 9 1,151,237 1,380,678 1,123,276
Other non-current financial instruments 3,280 - -
Retirement benefits obligation 7 171,589 283,856 194,700
Other non-current liabilities 55,507 56,592 55,299
Deferred tax liabilities 169,747 156,390 166,389
Provisions for liabilities and charges 29,250 26,484 30,672
Deferred income 19,674 17,946 21,649
__________ ___________ ___________
1,600,284 1,921,946 1,591,985
__________ ___________ ___________
Total liabilities 2,816,870 3,149,840 2,858,602
__________ ___________ ___________
Net assets 1,690,484 1,417,338 1,626,951
__________ ___________ ___________
Issued capital and reserves attributable
to equity holders of the parent
Share capital 21,940 21,903 21,939
Share premium account 398,711 395,741 398,711
Other reserves (141,629) (86,376) (98,234)
Retained earnings 1,411,462 1,086,070 1,304,535
__________ ___________ ___________
Shareholders' equity 1,690,484 1,417,338 1,626,951
__________ ___________ ___________
Kerry Group
plc
Condensed Consolidated Statement of Changes in Equity
for the half year ended 30 June 2011
Share Share Other Retained
Capital Premium Reserves Earnings Total
Notes EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
At 1 January
2010 21,895 395,177 (187,345) 1,054,328 1,284,055
Total
comprehensive
income - - 100,650 62,053 162,703
Dividends paid 4 - - - (30,311) (30,311)
Long term
incentive
plan expense - - 319 - 319
Shares issued
during the
period 8 564 - - 572
________ ________ ________ _______ ________
At 30 June
2010 -
unaudited 21,903 395,741 (86,376) 1,086,070 1,417,338
Total
comprehensive
income - - (12,810) 233,911 221,101
Dividends paid 4 - - - (15,446) (15,446)
Long term
incentive
plan expense - - 952 - 952
Shares issued
during the
period 36 2,970 - - 3,006
________ ________ ________ ________ ________
At 31 December
2010 -
audited 21,939 398,711 (98,234) 1,304,535 1,626,951
Total
comprehensive
income - - (44,094) 142,122 98,028
Dividends paid 4 - - - (35,195) (35,195)
Long term
incentive
plan expense - - 699 - 699
Shares issued
during the
period 3 1 - - - 1
_______ _______ ________ ________ ________
At 30 June
2011 -
unaudited 21,940 398,711 (141,629) 1,411,462 1,690,484
_______ _______ ________ ________ ________
Other Reserves comprise the following:
Capital Long Term
Capital Conversion Incentive Available-for-sale
Redemption Reserve Plan Investment Translation Hedging
Reserve Fund Reserve Reserve Reserve Reserve Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
At 1 January
2010 1,705 340 2,115 (7,403) (158,007) (26,095) (187,345)
Total
comprehensive
income - - - 7,403 90,017 3,230 100,650
Long term
incentive
plan expense - - 319 - - - 319
________ ________ ________ ________ ________ ________ ________
At 30 June
2010 -
unaudited 1,705 340 2,434 - (67,990) (22,865) (86,376)
Total
comprehensive
income - - - - (32,722) 19,912 (12,810)
Long term
incentive
plan expense - - 952 - - - 952
________ ________ ________ ________ ________ ________ ________
At 31 December
2010 -
audited 1,705 340 3,386 - (100,712) (2,953) (98,234)
Total
comprehensive
income - - - - (47,511) 3,417 (44,094)
Long term
incentive
plan expense - - 699 - - - 699
________ ________ _______ ________ ________ _______ ________
At 30 June
2011 -
unaudited 1,705 340 4,085 - (148,223) 464 (141,629)
________ ________ _______ ________ ________ _______ ________
Kerry Group plc
Condensed Consolidated Cash
Flow Statement
for the half year ended 30
June 2011
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
Notes EUR'000 EUR'000 EUR'000
Operating activities
Trading profit 213,572 203,797 470,216
Adjustments for:
Depreciation (net) and
impairment 55,248 51,702 148,351
Change in working capital (85,182) (26,184) (21,511)
Pension contributions paid
less pension expense (15,792) (14,328) (41,068)
Expenditure on
restructuring and other
costs (3,148) (25,005) (26,355)
Exchange translation
adjustment 10 251 2,705 (1,483)
__________ ___________ ___________
Cash generated from
operations 164,949 192,687 528,150
Income taxes paid (34,762) (33,096) (54,249)
Finance income received 391 501 945
Finance costs paid (25,995) (24,582) (58,525)
___________ ___________ ___________
Net cash from operating
activities 104,583 135,510 416,321
___________ ___________ ___________
Investing activities
Purchase of non-current
assets (60,237) (47,635) (151,001)
Proceeds from the sale of
non-current assets 611 2,047 7,162
Capital grants received - 4,314 4,395
Purchase of subsidiary
undertakings (net of cash
acquired) 8 (39,131) (8,054) (150,681)
Proceeds/(payments) due to
disposal of businesses
(net of related tax) 5,290 (183) (2,674)
Payment of deferred
consideration on
acquisition of
subsidiaries (2,935) (6,367) (7,824)
Consideration adjustment on
previous acquisitions 1,521 3,510 3,672
___________ ___________ ___________
Net cash used in investing
activities (94,881) (52,368) (296,951)
___________ ___________ ___________
Financing activities
Dividends paid 4 (35,195) (30,311) (45,757)
Issue of share capital 3 1 572 3,578
Net movement on bank
borrowings (35,020) (170,041) (201,706)
(Decrease)/increase in bank
overdrafts 9 (3,432) (6,500) 5,240
___________ ___________ ___________
Net cash movement due to
financing activities (73,646) (206,280) (238,645)
___________ ___________ ___________
Net decrease in cash and
cash equivalents (63,944) (123,138) (119,275)
Cash and cash equivalents
at beginning of period 159,340 270,011 270,011
Exchange translation
adjustment on cash and
cash equivalents 10 (4,499) 16,120 8,604
__________ ___________ ___________
Cash and cash equivalents
at end of period 9 90,897 162,993 159,340
___________ ___________ ___________
Reconciliation of Net Cash
Flow to Movement in Net
Debt
Net decrease in cash and
cash equivalents (63,944) (123,138) (119,275)
Cash outflow from debt
financing 38,452 176,541 196,467
___________ ___________ ___________
Changes in net debt
resulting from cash flows (25,492) 53,403 77,192
Fair value movement on
interest rate swaps
recognised in
shareholders' equity 4,428 6,507 19,415
Exchange translation
adjustment on net debt 10 45,222 (99,002) (49,064)
___________ ___________ ___________
Movement in net debt in the
period 24,158 (39,092) 47,543
Net debt at beginning of
period (1,111,933) (1,159,476) (1,159,476)
___________ ___________ ___________
Net debt at end of period 9 (1,087,775) (1,198,568) (1,111,933)
___________ ___________ ___________
Kerry Group plc
Notes to the Condensed Consolidated Interim Financial
Statements
for the half year ended 30 June 2011
1. Analysis of results
The Group has two operating segments: Ingredients & Flavours
and Consumer Foods. The Ingredients & Flavours operating
segment manufactures and distributes application specific
ingredients and flavours spanning a number of technology platforms
while the Consumer Foods segment supplies added value brands and
customer branded foods to the Irish and UK markets.
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Revenue
- Ingredients & Flavours 1,973,233 1,788,147 3,674,498
- Consumer Foods 943,790 885,625 1,768,059
- Group Eliminations and
Unallocated (267,054) (252,344) (482,554)
___________ ___________ ___________
2,649,969 2,421,428 4,960,003
___________ ___________ ___________
Trading profit
- Ingredients & Flavours 180,677 164,268 401,342
- Consumer Foods 63,803 63,001 131,963
- Group Eliminations and
Unallocated (30,908) (23,472) (63,089)
___________ ___________ ___________
213,572 203,797 470,216
Intangible asset amortisation (7,626) (7,994) (16,065)
Non-trading items (2,530) 163 (815)
___________ ___________ ___________
Operating profit 203,416 195,966 453,336
Finance income 391 501 945
Finance costs (28,589) (34,203) (61,446)
___________ ___________ ___________
Profit before taxation 175,218 162,264 392,835
Income taxes (30,855) (29,842) (68,618)
__________ ___________ ___________
Profit after taxation 144,363 132,422 324,217
__________ ___________ ___________
Information about geographical areas
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Revenue by location of customers
EMEA 1,594,995 1,471,631 2,972,173
Americas 762,202 701,441 1,479,003
Asia Pacific 292,772 248,356 508,827
__________ ___________ ___________
2,649,969 2,421,428 4,960,003
__________ ___________ ___________
2. Non-trading items
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
(Loss)/profit on disposal of non-current
assets (411) 581 183
Loss on disposal of businesses (2,119) (418) (998)
________ ________ ________
(2,530) 163 (815)
Tax 249 (340) 161
________ ________ ________
(2,281) (177) (654)
________ ________ ________
Loss on disposal of non-current assets
The loss on disposal of non-current assets relates to the sale
of property, plant and equipment in the UK and the USA.
Loss on disposal of businesses
The loss on disposal of businesses relates to the sale of the
Dawn Dairies business in Co. Limerick, Ireland and other non-core
businesses in Ireland and the USA.
2010 Non-trading items
The profit on disposal of non-current assets in 2010 relates to
the sale of property, plant and equipment in Europe. The loss on
disposal of businesses relates primarily to the sale of the
non-core Kerry Spring business in Co. Kerry, Ireland and the sale
of the Dawn Dairies business in Co. Galway, Ireland.
3. Earnings per A ordinary share
Half year
Half year ended ended Year ended
30 June 2011 30 June 2010 31 Dec. 2010
Unaudited Unaudited** Audited**
EPS EPS EPS
Notes cent EUR'000 cent EUR'000 cent EUR'000
Basic
earnings per
share
Profit after
taxation and
attributable
to equity
shareholders 82.2 144,363 75.6 132,422 185.0 324,217
Acquisition
related
intangible
asset
amortisation 3.3 5,709 3.4 6,049 6.7 11,812
Non-trading
items (net
of related
tax) 2 1.3 2,281 0.1 177 0.4 654
_______ _______ ______ ______ ______ ______
Adjusted
earnings* 86.8 152,353 79.1 138,648 192.1 336,683
_______ _______ ______ ______ ______ ______
Diluted
earnings per
share
Profit after
taxation and
attributable
to equity
shareholders 82.2 144,363 75.4 132,422 184.7 324,217
Adjusted
earnings* 86.8 152,353 79.0 138,648 191.8 336,683
_______ _______ ______ ______ ______ ______
* In addition to the basic and diluted earnings per share, an
adjusted earnings per share is also provided as it is considered
more reflective of the Group's underlying trading performance.
Adjusted earnings is profit after taxation before acquisition
related intangible asset amortisation and non-trading items (net of
related tax).
** In previous years Kerry has calculated adjusted earnings per
share after adding back all intangible amortisation including
computer software amortisation. However from 2011, with 2010
re-presented, computer software amortisation will be treated as a
cost in arriving at adjusted earnings per share. This is due to the
significance of the Kerryconnect project the Group is currently
undertaking.
Number of Number of Number
Shares Shares of Shares
30 June 30 June 31 Dec.
2011 2010 2010
000's 000's 000's
Unaudited Unaudited Audited
Basic weighted average number of
shares for the period 175,520 175,198 175,292
Impact of share options outstanding 94 308 234
_______ _______ _______
Diluted weighted average number
of shares for the period 175,614 175,506 175,526
_______ _______ _______
Shares issued during the period
During the period ended 30 June 2011, a total of 5,610 A
ordinary shares, each with a nominal value of 12.50 cent, were
issued at nominal value per share under the Long Term Incentive
Plan.
The total number of shares in issue at 30 June 2011 was
175,522,816 (30 June 2010: 175,229,885; 31 December 2010:
175,517,206).
4. Dividends
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Amounts recognised as distributions to
equity shareholders in the period
Final 2010 dividend of 20.00 cent per A
ordinary share paid 13 May 2011 (Final
2009 dividend of 17.30 cent per A
ordinary share paid 14 May 2010) 35,195 30,311 30,311
Interim 2010 dividend of 8.80 cent per
A ordinary share paid 12 November 2010 - - 15,446
________ ________ _________
35,195 30,311 45,757
________ ________ _________
Since the end of the period, the Board has proposed an interim
dividend of 9.80 cent per A ordinary share. The payment date for
the interim dividend will be 11 November 2011 to shareholders
registered on the record date 14 October 2011. These condensed
consolidated interim financial statements do not reflect this
dividend payable.
5. Deferred tax on items taken directly to reserves
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Deferred tax impact due to:
Fair value movements on cash flow
hedges (427) (404) (2,894)
Exchange difference on translation of
foreign operations (706) (403) (675)
Actuarial losses on defined benefit
post-retirement schemes (772) 16,962 5,584
________ _________ _________
(1,905) 16,155 2,015
________ _________ _________
6. Available-for-sale investments
The available-for-sale investments represent investments in
securities. These investments have no fixed maturity or coupon
rate. Quoted market prices are used to determine the fair value of
listed shares where there is an active market. A "sum-of-the-parts"
valuation model is used to determine the fair value of shares where
there is not an active market.
During the period, the Group recognised a fair value movement of
EURnil (increase 30 June 2010: EUR4,190,000; decrease 31 December
2010: (EUR3,287,000)) on its available-for-sale investments. In
addition, no impairment of available-for-sale investments arose in
the period (30 June 2010: EUR3,213,000; 31 December 2010:
EUR10,690,000).
7. Retirement benefits obligation
The Group's net defined benefit post-retirement schemes' deficit
which has been recognised in the Condensed Consolidated Balance
Sheet was as follows:
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
Net recognised deficit in plans before
deferred tax (171,589) (283,856) (194,700)
Net related deferred tax asset 41,717 72,019 50,116
________ _________ _________
Net recognised deficit in plans after
deferred tax (129,872) (211,837) (144,584)
________ _________ _________
The defined benefit post-retirement schemes' liabilities at 30
June 2011 have been rolled forward from the 31 December 2010
position and updated to reflect material movements in underlying
assumptions over the half year. The Group's defined benefit
post-retirement schemes' assets at 30 June 2011 are measured at
market value.
The decrease in the net deficit before deferred tax over the
half year to 30 June 2011 was accounted for by a decrease of
EUR24,847,000 in the underlying present value of schemes'
liabilities. The decrease in the present value of schemes'
liabilities was mostly due to an increase in discount rates in the
Eurozone and the UK. The increase in the assets over the half year
to 30 June 2011 was due to ongoing cash contributions and a modest
investment return of less than 1% in the first half of the year
which were offset by negative foreign exchange movements so the
market value of assets at 30 June 2011 was EUR736,000,000.
8. Business combinations
The principal acquisitions completed during the period, all of
which were 100% acquired, are summarised as follows:
In January 2011, the Group acquired the following:
- the Unilever Frozen Savory Foodservice Business based in Texas
and North Carolina USA, which develops and markets a variety of
soups, sauces and meal solutions;
- the business and assets of UK based Headland Foods. Headland
Foods is a leading manufacturer of frozen customer branded ready
meals supplying major retailers in the UK. This acquisition is
currently being reviewed by the Competition Commission; and
- EBI Cremica, a provider of food coating systems to the food
processor and foodservice sectors in India.
The Group acquired General Cereals S.A. in June 2011. Based in
Argentina the acquired company manufactures extruded cereals for a
range of customers.
In addition during the period the Group completed a number of
small acquisitions in the UK and Central America.
Total consideration for the acquisitions was EUR39,871,000,
being cash of EUR39,131,000 and deferred payments of EUR740,000,
with no individual acquisition costing in excess of EUR21,500,000.
The total consideration figure includes EUR1,430,000 of net cash
taken over at the date of acquisition. Acquisition related costs
were charged against trading profit in the Group's Condensed
Consolidated Income Statement during the period and represented
less than one percent of the total consideration.
The net assets acquired before combination were EUR24,955,000.
The Group recognised goodwill on acquisition of EUR14,916,000. As
these acquisitions were only recently completed the initial
accounting for these business combinations is incomplete and
therefore the disclosure of fair value adjustments and separate
disclosure of the acquisitions' revenues and profit or loss is
impracticable.
9. Financial instruments
The following table outlines the components of net debt by
category at the balance sheet date:
Loans &
Receivables &
Other Liabilities at Derivatives
Financial Fair Value Designated Total Net
Liabilities through Profit as Hedging Debt
at Amortised and Loss Instruments by Category
Cost EUR'000 EUR'000 EUR'000 EUR'000
Assets:
Interest rate
swaps - - 17,399 17,399
Cash and cash
equivalents 90,897 - - 90,897
__________ ________ ________ __________
Total assets 90,897 - 17,399 108,296
__________ ________ ________ __________
Liabilities:
Interest rate
swaps - - (3,280) (3,280)
Bank
overdrafts (3,764) - - (3,764)
Bank loans (383,812) - - (383,812)
Senior notes (797,658) (7,557) - (805,215)
__________ ________ ________ __________
Borrowings and
overdrafts (1,185,234) (7,557) - (1,192,791)
__________ ________ ________ __________
Total
liabilities (1,185,234) (7,557) (3,280) (1,196,071)
__________ ________ ________ __________
At 30 June
2011 -
unaudited (1,094,337) (7,557) 14,119 (1,087,775)
__________ ________ ________ __________
Assets:
Interest rate
swaps - - 87,901 87,901
Cash and cash
equivalents 162,993 - - 162,993
__________ ________ ________ __________
Total assets 162,993 - 87,901 250,894
__________ ________ ________ __________
Liabilities:
Interest rate
swaps - - (19,649) (19,649)
Bank
overdrafts (8,456) - - (8,456)
Bank loans (475,956) - - (475,956)
Senior notes (928,050) (17,351) - (945,401)
__________ ________ ________ __________
Borrowings and
overdrafts (1,412,462) (17,351) - (1,429,813)
__________ ________ ________ __________
Total
liabilities (1,412,462) (17,351) (19,649) (1,449,462)
__________ ________ ________ __________
At 30 June
2010 -
unaudited (1,249,469) (17,351) 68,252 (1,198,568)
__________ ________ ________ __________
Assets:
Interest rate
swaps - - 42,680 42,680
Cash and cash
equivalents 159,340 - - 159,340
__________ ________ ________ __________
Total assets 159,340 - 42,680 202,020
__________ ________ ________ __________
Liabilities:
Interest rate
swaps - - (9,391) (9,391)
Bank
overdrafts (7,196) - - (7,196)
Bank loans (436,121) - - (436,121)
Senior notes (858,398) (2,847) - (861,245)
__________ ________ ________ __________
Borrowings and
overdrafts (1,301,715) (2,847) - (1,304,562)
__________ ________ ________ __________
Total
liabilities (1,301,715) (2,847) (9,391) (1,313,953)
__________ ________ ________ __________
At 31 December
2010 -
audited (1,142,375) (2,847) 33,289 (1,111,933)
__________ ________ ________ __________
The following table sets out the currency profile of the Group's
net debt, highlighting the impact of cross currency swaps (CCS) on
net debt:
Notional
Pre CCS CCS Half Post CCS
Half year year Half year Half year Year ended
ended 30 ended 30 ended 30 ended 30 31 Dec.
June 2011 June 2011 June 2011 June 2010 2010
Unaudited Unaudited Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Euro (153,770) (344,828) (498,598) (511,170) (470,101)
Sterling (87,814) - (87,814) (108,441) (60,782)
US Dollar (830,382) 344,828 (485,554) (566,956) (540,160)
Other (15,809) - (15,809) (12,001) (40,890)
__________ ________ __________ __________ __________
(1,087,775) - (1,087,775) (1,198,568) (1,111,933)
__________ ________ __________ __________ __________
The following table details the maturity profile of the Group's
net debt:
On demand
& up to 1 Up to 2 2 - 5
year years years > 5 years Total
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Cash and
cash
equivalents 90,897 - - - 90,897
Interest
rate swaps - (1,124) (2,156) 17,399 14,119
Bank
overdrafts (3,764) - - - (3,764)
Bank loans (37,790) (149) (345,620) (253) (383,812)
Senior notes - (158,621) (225,244) (421,350) (805,215)
_________ ________ _________ _________ __________
At 30 June
2011 -
unaudited 49,343 (159,894) (573,020) (404,204) (1,087,775)
_________ ________ _________ _________ __________
Cash and
cash
equivalents 162,993 - - - 162,993
Interest
rate swaps (19,649) - - 87,901 68,252
Bank
overdrafts (8,456) - - - (8,456)
Bank loans (40,679) (115,948) (318,813) (516) (475,956)
Senior notes - - (441,964) (503,437) (945,401)
_________ ________ __________ _________ ___________
At 30 June
2010 -
unaudited 94,209 (115,948) (760,777) (416,052) (1,198,568)
_________ ________ __________ _________ ___________
Cash and
cash
equivalents 159,340 - - - 159,340
Interest
rate swaps (9,391) - 3,479 39,201 33,289
Bank
overdrafts (7,196) - - - (7,196)
Bank loans (174,090) (261,212) (480) (339) (436,121)
Senior notes - - (410,637) (450,608) (861,245)
_________ ________ _________ _________ __________
At 31
December
2010 -
audited (31,337) (261,212) (407,638) (411,746) (1,111,933)
_________ ________ _________ _________ __________
10. Effect of exchange translation adjustments on the Condensed
Consolidated Balance Sheet
Half year Half year Year
ended ended ended
30 June 30 June 31 Dec.
2011 2010 2010
Unaudited Unaudited Audited
EUR'000 EUR'000 EUR'000
(Decrease)/increase in assets
Property, plant and equipment (45,282) 89,783 54,146
Intangible assets (54,859) 112,149 58,929
Inventories (20,263) 38,825 24,969
Trade and other receivables (22,132) 47,506 30,442
Cash and cash equivalents (4,499) 16,120 8,604
Assets classified as held for sale (409) 733 316
Decrease/(increase) in liabilities
Trade and other payables 33,517 (67,013) (43,932)
Tax liabilities 1,101 (3,080) (2,215)
Financial liabilities 49,721 (115,122) (57,668)
Retirement benefits obligation 7,890 (17,184) (7,063)
Other non-current liabilities 1,577 (4,898) (641)
Deferred tax liabilities 3,449 (6,295) (5,802)
Provisions for liabilities and charges 2,223 (3,769) (1,106)
Deferred income 204 (443) (201)
Retained earnings 251 2,705 (1,483)
________ _________ _________
(47,511) 90,017 57,295
________ _________ _________
The above exchange translation adjustments arise primarily on
the retranslation of the Group's opening net investment in its
foreign currency subsidiaries.
11. Events after the balance sheet date
Since the period end, the Group has:
- proposed an interim dividend of 9.80 cent per A ordinary share
(see note 4); and
- entered into exclusive discussions with Cargill which may or
may not result in the Group's acquisition of Cargill's global
flavours business.
There have been no other significant events, outside the
ordinary course of business, affecting the Group since 30 June
2011.
12. Accounting policies
These condensed consolidated interim financial statements for
the half year ended 30 June 2011 have been prepared in accordance
with the requirements of IAS 34 'Interim Financial Reporting' and
using accounting policies consistent with International Financial
Reporting Standards as adopted by the European Union. The
accounting policies applied by the Group in these condensed
consolidated interim financial statements are the same as those
detailed in the 2010 Annual Report. Some comparative information
has been re-presented to align with the current half year
presentation.
The following standards and interpretations are effective from 1
January 2011 but do not have a material effect on the results or
financial position of the Group:
- IFRS 1 (amendment) First-time adoption of International Financial
Reporting Standards
- IFRS 3 (amendment) Business Combinations
- IFRS 7 (amendment) Financial Instruments: Disclosures - Improving
disclosures about Financial Instruments
- IAS 1 (amendment) Presentation of Financial Statements
- IAS 24 (amendment) Related Party Transactions
- IAS 27 (amendment) Consolidated and Separate Financial Statements
- IAS 32 (amendment) Financial Instruments: Presentation
- IAS 34 (amendment) Interim Financial Reporting
- IFRIC 13 (amendment) Customer Loyalty Programmes - Amendments resulting
from May 2010 Annual Improvements to IFRSs
- IFRIC 14 (amendment) IAS 19 - The Limit on a Defined Benefit Asset,
Minimum Funding Requirements and their
Interaction
- IFRIC 19 Extinguishing Financial Liabilities with Equity
Instruments
13. General information
These condensed consolidated interim financial statements for
the half year ended 30 June 2011 have been prepared on the going
concern basis as detailed in the 2010 Annual Report. The Board of
Directors approved these condensed consolidated interim financial
statements on 16 August 2011. These are not full financial
statements and were not reviewed by the auditors. Full consolidated
financial statements to 31 December 2010, which were audited and
received an unqualified audit report, have been filed with the
Registrar of Companies.
In relation to seasonality, trading profit is lower in the first
half of the year due to the nature of the food business and
stronger December trading. While revenue is relatively evenly
spread, margin has traditionally been higher in the second half of
the year.
As permitted by the Transparency (Directive 2004/109/EC)
Regulations 2007 this Interim Report is available on
www.kerrygroup.com. However, if a physical copy is required, please
contact the Corporate Affairs department.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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