MPICO : H1 2023 Financials

SUMMARY UNAUDITED CONSOLIDATED AND SEPARATE RESULTS

FOR THE SIX MONTHS ENDED 30 JUNE 2023

MPICO PLC REG. NO COYR-A5K1E78

SUMMARY CONSOLIDATED AND SEPARATE STATEMENTS OF PROFIT OR LOSS

	CONSOLIDATED	CONSOLIDATED	CONSOLIDATED	SEPARATE	SEPARATE	SEPARATE
	UNAUDITED	UNAUDITED	AUDITED	UNAUDITED	UNAUDITED	AUDITED
	6 months to	6 months to	12 months to	6 months to	6 months to	12 months to
	30-Jun-23	30-Jun-22	31-Dec-22	30-Jun-23	30-Jun-22	31-Dec-22
	K'000	K'000	K'000	K'000	K'000	K'000
Rental income	3,461,347	3,303,084	6,841,041	1,262,887	1,228,331	2,468,693
Increase in fair value of investment properties	4,475,800	3,322,300	6,690,900	1,567,800	1,156,000	2,428,500
Other income	672,109	459,716	1,027,878	886,751	817,538	1,183,365
Dividend income from subsidiaries	-	-	-	400,000	974,000	1,716,000
Total income	8,609,256	7,085,100	14,559,819	4,117,438	4,175,869	7,796,558
Total operating expenses and finance costs
(2,729,115)	(2,116,759)	(5,554,560)	(1,701,616)	(1,288,810)	(3,543,388)
Profit before income tax	5,880,141	4,968,341	9,005,259	2,415,822	2,887,059	4,253,170
Income tax expense	(798,210)	(1,807,000)	(867,783)	(290,249)	(650,246)	(784,832)
Profit after taxation for the period	5,081,931	3,161,341	8,137,476	2,125,573	2,236,813	3,468,338
APPROPRIATION OF PROFIT FOR THE PERIOD					1,453,943
Realisable profits	778,545	968,905	1,089,817	703,860	1,600,247
Unrealisable profits	2,989,030	1,554,150	4,636,627	1,421,713	782,870	1,868,091
Amount attributable to members of the parent company	3,767,575	2,523,055	5,726,444	2,125,573	2,236,813	3,468,338
Amount attributable to non-controlling interests	1,314,356	638,286	2,411,032	-	-	-
	5,081,931	3,161,341	8,137,476	2,125,573	2,236,813	3,468,338
Earnings per share (tambala)	163.9	109.8	249.2
Analysed as:
- Realisable (tambala)	33.9	42.2	47.4
- Unrealisable (tambala)	130.1	67.6	201.8
Number of shares used for calculation	2,298,047,460	2,298,047,460	2,298,047,460

STATEMENTS OF FINANCIAL POSITION

EQUITY AND LIABILITIES
Ordinary share capital	114,902	114,902	114,902	114,902	114,902	114,902
Realisable reserves	6,684,909	6,543,807	5,906,364	10,403,808	10,312,003	9,699,948
Unrealisable reserves	40,632,584	34,561,081	37,643,559	19,462,506	16,955,573	18,040,792
Share Premium	8,626,938	8,626,938	8,626,938	8,626,938	8,626,938	8,626,938
EQUITY ATTRIBUTABLE TO OWNERS OF PARENT COMPANY	56,059,333	49,846,728	52,291,763	38,608,154	36,009,416	36,482,580
Non-controlling interests	24,622,956	21,793,862	23,308,595	-	-	-
TOTAL EQUITY	80,682,289	71,640,590	75,600,358	38,608,154	36,009,416	36,482,580
LIABILITIES	11,532,492	14,407,488	11,159,743	5,908,991	5,608,443	5,751,748
Non-current liabilities
Current liabilities	11,532,492	14,407,488	11,159,743	5,908,991	5,608,443	5,751,748
5,995,359	1,185,632	5,729,067	1,902,708	403,063	1,433,427
Borrowings and trade payables
Bank overdraft	705,499	556,095	-	705,499	556,095	-
TOTAL LIABILITIES	6,700,858	1,741,727	5,729,067	2,608,207	959,158	1,433,427
18,233,350	16,149,215	16,888,810	8,517,198	6,567,601	7,185,175
TOTAL EQUITY AND LIABILITIES	98,915,639	87,789,805	92,489,168	47,125,352	42,577,017	43,667,755
ASSETS
NON-CURRENT ASSETS	82,262,546	74,418,146	77,786,747	25,496,507	22,656,207	23,928,707
Investment properties
Other assets	3,358,488	1,809,340	3,415,988	14,911,775	14,973,670	14,943,309
Total non-current assets	85,621,034	76,227,486	81,202,735	40,408,282	37,629,877	38,872,016
CURRENT ASSETS	9,928,748	7,917,661	10,906,779	5,693,576	3,836,051	4,720,415
Trade and other receivables
Promissory notes receivable	2,986,511	3,068,982	-	877,455	760,250	-
Cash and bank equivalents	379,346	575,676	379,654	146,039	350,839	75,324
Total current assets	13,294,605	11,562,319	11,286,433	6,717,070	4,947,140	4,795,739
TOTAL ASSETS	98,915,639	87,789,805	92,489,168	47,125,352	42,577,017	43,667,755

CONSOLIDATED AND SEPARATE STATEMENTS OF CHANGES IN EQUITY

At the beginning of the period	75,600,358	68,805,249	68,805,249	36,482,580	33,772,602	33,772,602
Realisable profit for the period	778,545	968,905	1,089,817	703,860	1,453,943	1,600,247
Amount attributable to minority interests	1,314,356	638,286	2,411,024	-	-	-
Unrealisable profit for the period	2,989,030	1,554,150	4,636,627	1,421,713	782,870	1,868,090
Dividend declared - Final 2021	-	-	(436,631)	-	-	(436,631)
Dividend declared - Interim 2022	-	-	(321,728)	-	-	(321,728)
Dividend declared to minority interests	-	(326,000)	(584,000)	-	-	-
At the end of the period
80,682,289	71,640,590	75,600,358	38,608,154	36,009,416	36,482,580

SUMMARY CONSOLIDATED AND SEPARATE STATEMENTS OF CASH FLOWS

	CONSOLIDATED	CONSOLIDATED	CONSOLIDATED	SEPARATE	SEPARATE	SEPARATE
	UNAUDITED	UNAUDITED	AUDITED	UNAUDITED	UNAUDITED	AUDITED
	6 months to	6 months to	12 months to	6 months to	6 months to	12 months to
	30-Jun-23	30-Jun-22	31-Dec-22	30-Jun-23	30-Jun-22	31-Dec-22
	K'000	K'000	K'000	K'000	K'000	K'000
Cash flows from operating activities	(205,722)	2,468,190	4,103,207	(614,128)	1,364,435	1,244,935
Return on investment and servicing of finance
Dividend received	-	-	-	-	374,000	1,716,000
Interest received	625,908	417,294	900,847	194,027	130,981	284,096
Interest paid	(374,755)	(363,636)	(720,909)	(53,015)	(96,467)	(167,126)
Dividend paid	-	-	(758,359)	-	-	(758,359)
Dividend paid outside shareholders, including tax	-	(326,000)	(584,000)	-	-	-
Net cash flows from returns on investment and servicing of finance	45,431	2,195,848	2,940,786	(473,116)	1,772,949	2,319,546
Income tax paid	(468,151)	(1,310,295)	(1,443,688)	(165,370)	(948,493)	(1,209,198)
Net cash flows generated from operating activities	(422,720)	885,553	1,497,098	(638,486)	824,456	1,110,348
Purchase of property, plant and equipment and additions to investment properties	(4,508)	(10,665)	(30,628)	(3,050)	(8,830)	(23,442)
Proceeds on disposal of non-current assets	(833)	282	2,223	(833)	282	2,223
Staff long-term loan movements	7,585	5,965	13,324	7,585	5,965	13,324
Net cash used in investing activities	2,244	(4,418)	(15,081)	3,702	(2,583)	(7,895)
Net cash flow before financing activities	(420,476)	881,135	1,482,017	(634,784)	821,873	1,102,453
Repayment of borrowings	(285,331)	(196,286)	(437,095)	-	-	-
Net cash used in financing activities	(285,331)	(196,286)	(437,095)	-	-	-
NET INCREASE IN CASH AND CASH EQUIVALENT	(705,807)	684,849	1,044,922	(634,784)	821,873	1,102,453
Cash and cash equivalents at the beginning of the period	379,654	(665,268)	(665,268)	75,324	(1,027,129)	(1,027,129)
CASH AND CASH EQUIVALENTS AT THE END OF THE PERIOD	(326,153)	19,581	379,654	(559,460)	(205,256)	75,324

REVIEW OF MID-YEAR RESULTS

The MPICO plc Board is pleased to announce the unaudited results of the Group for the half year ended 30 June 2023.

Rental income increased by 5% to MK3.46 billion from MK3.30 billion in June 2022 due to rent reviews and improved occupancy levels. Fair value gains for the period increased to MK4.48 billion from MK3.32 billion in the corresponding period last year representing a 35% movement. Total operating expenditure for the period increased by 29% to MK2.73 billion from MK2.11 billion in 2022 due to inflationary pressures.

Profit after tax increased to MK5.08 billion in June 2023 from K3.16 billion in June 2022, representing a year-on-year increase of 61% due to improved income.

Government rental arrears decreased to MK4.9 billion as at 30 June 2023 from K6.0 billion owing as at 31 December 2022. This was due to payments made by Government through promissory notes in March and April 2023. Arrears as at 31 July 2023 had reduced further to MK3.7 billion after the Government had issued further promissory notes of MK1.6 billion.

OUTLOOK

The economy continues to experience head-winds emanating from uncertain weather patterns, and foreign currency and power supply shortages. Real GDP growth is therefore projected to average a modest 1.7% in 2023, which is a downward revision from the earlier projection of 2.2%. In 2022 real GDP growth was estimated at 0.8%. Inflation on the other hand is projected to remain elevated following potential further hikes in utility tariffs and energy prices, as well as sustained rising maize prices. Due to the projected increase in headline inflation, the tight monetary policy stance, interest rates will likely remain high.

The Board will continue to monitor the developments surrounding the economic environment and take the necessary mitigating measures to sustain the business.

DIVIDEND

The Board of Directors has resolved to declare no dividend for the period (2022:Nil), but will assess the position as the year progresses.

By order of the Board.

Edith Jiya	Chris Kapanga
Chairperson	Director