SOUTH AFRICA – Country Bird’s debt burden is weighing on the poultry producer’s expansion in other African countries, the group said in its annual results published on Monday.
The group reported a loss from continuing operations of R115.5m for its year ended June, from a R61.8m profit previously. As a result, it decided not to declare a dividend for the period.
Country Bird, which is trading under a cautionary as it has received an expression of interest for all its shares not held by parent company Synapp International, recorded a R152.9m operating loss in South Africa but a R44.5m operating profit elsewhere in Africa.
The group’s more profitable operations outside South Africa include investments in Botswana, Mozambique, Namibia, Zambia and Zimbabwe.
“High levels of debt remain a hurdle to our expansion into other African economies and we are actively seeking ways in which this can be remedied to enable the group to generate good returns from existing opportunities,” Country Bird said.
As a result of the group’s losses, it said it had breached “certain covenants” of its long-term loans from the International Finance Corporation and Investec Bank, to the value of R358.2m.
“The directors consider that the group’s breach of such financial covenants will not result in any liquidity issue to the group,” Country Bird
Country Bird’s long-term and short-term borrowings amounted to R578m at the end of June