Operational Highlights

• Both sales and profitability impacted by the concerns surrounding imported beef products (which resulted in sales being approximately ZMW41.4 million lower than expected, and one-off cost of ZMW7.4 million relating to the beef stock write off); ZMW12.7 million relating to the increase in finance costs, ZMW21.2 million due to lower wheat prices and ZMW15.9 million of currency costs
• Increase in the Group’s overhead expenditure, impacted by the removal of the Zambian fuel subsidy together with higher labour costs due to an increase in the statutory minimum wage
• Despite the above challenges, it was encouraging to see the business return to cash generation
• In our key divisions, strongest gross profit growth seen in cropping (up 49 per cent.), edible oils (up 105 per cent.) and stock feed (up 21 per cent.)
• Continuation of the upgrading of Zambeef’s retail outlets, with 20 being refurbished during FY 2013
• Crushing resumed at Zamanita’s refurbished plant, with an increased annual capacity of 100,000 M.T.
• Crop yields continued to improve across Zambeef’s farms, led by Mpongwe
• Joint venture arrangements put in place with Rainbow to facilitate future expansion of the Group’s poultry operations.

Commenting on the results, Chairman Dr. Jacob Mwanza, said:

“2013 was a challenging year for Zambeef as the Group sought to respond to, and address the consequences arising from concerns surrounding imported beef products together with upward pressure on general overhead expenditure. Notwithstanding these challenges, it is heartening to see revenues continue to increase at the same time as the directors prepare the business for future growth across a number of divisions. A key financial highlight this year has been to return the business to positive cash generation, which is in line with the strategy set out when Zambeef listed on the AIM Market of the London Stock Exchange in June 2011. The focus on managing controllable costs continues to drive efficiency savings where possible, leaving the business well positioned to target future bottom line growth.”

For further information, please contact:

Accordingly, investors in Zambeef Products PLC are advised to exercise caution when trading in the Company’s shares and should seek the professional advice of a broker or investment advisor for guidance.

Further information can be found on www.zambeefplc.com

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