Group turnover* R15,9 billion 9% Group operating income* R2,1 billion 7% cents 7% HEPS* unchanged at. 978 cents. Interim dividend per share

Transcription

1 group results and dividend declaration for the 2016

2 Highlights Continuing operations deliver a solid underlying performance * From continuing operations. Group turnover* R15,9 billion 9% Group operating income* R2,1 billion 7% EPS* cents 7% HEPS* unchanged at 978 cents Interim dividend per share 363 cents 7% Total EPS cents 26% Total HEPS 975 cents 14%

3 Commentary group results and dividend declaration for the Overview The group achieved solid results for the 2016, notwithstanding the significant inflationary cost pressures experienced in the Milling and Baking businesses. Soft commodity prices, particularly in Maize and Sorghum, were severely impacted by rand weakness and the effects of the drought in Southern Africa. The balance of the group s domestic businesses reflected a solid underlying performance, while the International segment benefited from the turnaround of Haco Tiger Brands (Haco) and a strong performance from the Deciduous Fruit (LAF) business. The group s interest in Tiger Branded Consumer Goods plc (TBCG), formerly Dangote Flour Mills plc, was disposed of with effect from 25 February Consequently, TBCG has been treated as a discontinued operation in these results, with the comparative information restated accordingly. Group turnover from continuing operations increased by 9% to R15,9 billion (: R14,6 billion), while operating income before abnormal items and IFRS 2 charges increased by 7% to R2,1 billion (: R1,9 billion). This was achieved notwithstanding a 23% increase in marketing investment from R409 million to R502 million, in line with the group s strategic objective to sustain the strength of its brands. Income from associates of R371 million, which includes a capital profit of R72 million relating to the disposal of certain assets by Carozzi, increased by 56% compared to the prior year, reflecting a strong underlying performance by all of the associate companies. Net financing costs of R118 million (: R116 million), which are after foreign exchange gains of R32 million relating to foreign cash holdings and loan balances, reflect the higher domestic interest rates in the current period. The comparative figure of R116 million has been restated to include the effect of foreign exchange losses of R5 million on foreign cash holdings and loan balances. Profit before tax from continuing operations increased by 15% to R2,3 billion (: R2,0 billion). Attributable earnings, which increased by 8%, were impacted by a significantly higher effective tax rate in the current period of 30,6% (: 25,9%), as well as the outside shareholder s share of losses incurred by Haco in the prior year changing to a share of profit in the current period. Earnings per share from continuing operations increased by 7% to cents (: 954 cents) while headline earnings per share from continuing operations was in line with the prior period at 978 cents (: 975 cents). Including discontinued operations, total earnings per share increased by 26% to cents (: 832 cents) while total headline earnings per share increased by 14% to 975 cents (: 853 cents).

4 group results and dividend declaration for the Commentary (continued) Operating performance Grains Turnover in the Grains division increased by 10% to R6,2 billion (: R5,6 billion), while operating income declined by 1% from R890 million to R881 million. The Millbake wheat value chain posted unchanged earnings while there was a decline in the contribution from Maize and Sorghum. The period under review was characterised by significant inflation in raw material inputs and intense competition, which adversely impacted volumes and margins. Marketing investment increased by 36% to R173 million (: R127 million), driving visibility and brand awareness in an extremely competitive environment. Overall volume within the Milling and Baking categories declined by 2%, driven primarily by Maize and Sorghum. However, turnover increased by 9% to R4,3 billion (: R3,9 billion), mainly due to the effects of inflation, while operating income declined by 4% to R710 million (: R736 million). Other Grains reflected solid growth, increasing total volumes by 4% and operating income by 11% to R171 million (: R154 million). Consumer Brands Food The Consumer Brands Food businesses delivered a satisfactory performance in the period under review, other than the Snacks & Treats category. Turnover increased by 8% to R5,8 billion (: R5,3 billion) while operating income grew by 4% to R609 million (: R585 million). These businesses were not immune to the significant cost pressures resulting from the weaker rand. Careful management of price positioning in a competitive market resulted in good volume growth in the Groceries, Beverages, Out of Home and Value Added Meat Product categories and operating income for these categories grew by 11%. The aggregate profit growth for the Consumer Brands Food businesses of 4%, was negatively impacted by the underperformance of Snacks & Treats where operating income declined by 12%. The Groceries business continued on its path to recovery and delivered a strong operating performance, underpinned by good volume. Volumes in Snacks & Treats declined by 3%, while turnover remained flat at R1,1 billion as the sugar category came under increasing competitive pressure during the period. The business faced a number of technical challenges in the Gums and Jellies plant, which resulted in supply constraints. This, together with an unfavourable sales mix, resulted in a 12% decline in operating income to R147 million (: R167 million). The Beverages business achieved strong top-line growth of 17% to R758 million (: R648 million), which was underpinned by excellent volume growth across the Oros, Energade and Rose s brands. Operating income grew by 10% to R105 million (: R96 million), reflecting increasing pressure on margins due to above inflationary increases in raw material costs which had to be partially absorbed to counter intense competitive activity. The Value Added Meat Products (VAMP) business delivered a pleasing performance, with turnover up 3% to R1,1 billion (: R1,1 billion) and operating income up 10% to R77 million (: R70 million), primarily attributable to improved pricing and disciplined cost control.

5 group results and dividend declaration for the Home, Personal Care and Baby (HPCB) HPCB s strong performance was driven mainly by the Home Care and Baby categories, with overall turnover increasing by 13% to R1,3 billion (: R1,2 billion) and operating income increasing by 18% to R272 million (: R231 million). The Home Care category (excluding Stationery) produced an excellent performance and achieved top-line growth of 27%. This was underpinned by exceptional volume growth within the Pest, Sanitary and Air Care segments, due to strong market demand, expansion of in-store presence and optimal pricing. Operating income increased by 115% to R103 million (: R48 million), benefiting from the increase in volumes and a favourable product mix. Purity maintained its leading brand position in the homogenised baby food segment, increasing its share of the fast growing pouch segment, which now accounts for around 8% of total category volumes. Volumes declined as a result of lower promotional discounts compared to the prior period as well as down-trading within the cereals segment in favour of more affordable soft porridges. Turnover for the Baby category increased by 9% to R443 million (: R407 million), while operating income increased by 13% to R115 million (: R102 million). Volumes in the Personal Care category were negatively affected by increased competitor activity which resulted in unchanged turnover of R303 million compared to the corresponding prior period (: R300 million). Operating income declined by 38% to R47 million (: R75 million), impacted by pressure on volumes, an unfavourable sales mix and a significantly higher marketing spend of R35 million (: R19 million). Exports and International Total turnover for the Exports and International businesses rose by 8% to R2,6 billion (: R2,5 billion), while operating income increased by 34% to R292 million (: R219 million), largely driven by the profit recovery at Haco. Chococam achieved excellent growth in operating income (up 11% in constant currency terms), driven by strong volume growth and tight cost management, despite significantly higher raw material costs. In rand terms, Chococam s operating income grew by 33% to R68 million, benefiting from the effects of the weak rand. Both of the East African businesses, Kenyan-based Haco and Ethiopian-based EATBI, reported strong volume growth during the period. Following last year s losses, Haco achieved a profit turnaround while EATBI improved its operating performance in a difficult macro-economic environment. Deli Foods, which is based in Nigeria, continues to face a tough economic environment, with the constraints on disposable incomes limiting the ability to recover the significant increase in raw material costs due to the devaluation of the naira. The Exports business was negatively impacted by local currency devaluation and foreign currency shortages in a number of African countries, resulting in a slowdown in customer demand. Also contributing to the lower turnover was the impact of reduced sales into Mozambique which recommenced in November, following the appointment of a new distributor.

6 group results and dividend declaration for the Commentary (continued) The Deciduous Fruit business (LAF) achieved 3% volume growth and 2% pricing inflation in foreign currency terms. Partly as a result of rand weakness, turnover grew by 27% to R808 million (: R636 million), while operating income increased by 153% to R93 million (: R37 million). Cash flow and capital expenditure Cash generated from operations improved by 31% to R1,9 billion, due to improved working capital management notwithstanding the adverse impact of inflation on inventory and debtor levels. Capital expenditure incurred during the period amounted to R257 million (: R363 million). Overall, net interest-bearing debt was reduced by R1,1 billion, primarily as a result of the disposal of TBCG. Interim dividend The company has declared an interim dividend of 363 cents per share for the 2016, which represents an increase of 7% compared to the previous interim dividend of 339 cents per share. Shareholders are referred to the dividend announcement below for further details. Outlook The outlook for the balance of the year remains challenging, with downside risk to the macroeconomic environment, both in South Africa and in a number of African markets, likely to add further pressure on consumers. This will be exacerbated by increased inflationary pressures in the second half, when the full impact of the rand s depreciation on the group s domestic cost base will be felt. Against this background, we remain focused on the quality and strength of our brands and on our ability to deliver value to our consumers in a cost-effective manner. The key challenge will be to maintain volume momentum notwithstanding price increases that are currently being taken to partly offset the cost pressures referred to above. By order of the board A C Parker Chairman L C Mac Dougall Incoming Chief Executive Officer N P Doyle Chief Operating Officer Bryanston 23 May 2016

7 group results and dividend declaration for the Declaration of interim dividend The board has approved and declared an interim dividend of 363 cents per ordinary share (gross) in respect of the The dividend will be subject to the Dividends Tax that was introduced with effect from 1 April In accordance with paragraphs (a) (i) to (x) and (c) of the JSE Listings Requirements the following additional information is disclosed: The dividend has been declared out of income reserves The local Dividends Tax rate is 15% (fifteen per centum) The gross local dividend amount is 363 cents per ordinary share for shareholders exempt from the Dividends Tax The net local dividend amount is 308,55 cents per ordinary share for shareholders liable to pay the Dividends Tax Tiger Brands has ordinary shares in issue (which includes treasury shares), and Tiger Brands Limited s income tax reference number is 9325/110/71/7. Shareholders are advised of the following dates in respect of the interim dividend: Last day to trade cum the interim dividend Friday, 24 June 2016 Shares commence trading ex the interim dividend Monday, 27 June 2016 Record date to determine those shareholders entitled to the interim dividend Friday, 1 July 2016 Payment in respect of the interim dividend Monday, 4 July 2016 Share certificates may not be dematerialised or re-materialised between Monday, 27 June 2016 and Friday, 1 July 2016, both days inclusive. By order of the board T Naidoo Secretary Sandton 23 May 2016

8 group results and dividend declaration for the Interim condensed consolidated income statement Note 2016 Change % Restated* # year 30 September Restated* # Turnover , , ,0 Cost of sales (10 769,1) (10) (9 770,6) (18 980,5) Gross profit 5 124, , ,5 Sales and distribution expenses (1 818,6) (5) (1 737,7) (3 425,7) Marketing expenses (502,4) (23) (409,4) (809,5) Other operating expenses (794,2) (4) (766,6) (1 418,6) Operating income before abnormal items , , ,7 Abnormal items 3 (3,2) 92 (41,4) (338,5) Operating income after abnormal items , , ,2 Net finance costs 8 (117,6) (2) (115,8) (204,0) Investment income 0,4 0,4 0,8 Income from associated companies 370, ,5 602,8 Profit before taxation 2 259, , ,8 Taxation (579,4) (27) (457,1) (977,3) Profit for the period from continuing operations 1 680, , ,5 Profit for the period from discontinued operation 6 27,6 109 (315,7) (2 167,5) Profit for the period 1 707, ,5 942,0 Attributable to: Owners of the parent 1 703, , ,1 Continuing operations 1 658, , ,4 Discontinued operation 44,4 123 (195,8) (1 394,3) Non-controlling interest 4,3 103 (149,9) (785,1) Continuing operations 21,1 170 (30,0) (11,9) Discontinued operation (16,8) 86 (119,9) (773,2) 1 707, ,5 942,0

9 group results and dividend declaration for the Interim condensed consolidated income statement (continued) 2016 Change % Restated* # year 30 September Restated* # Basic earnings per share (cents) 1 048, , ,1 Continuing operations 1 021, , ,4 Discontinued operation 27,3 122 (121,6) (862,3) Diluted basic earnings per share (cents) 1 034, , ,9 Continuing operations 1 007, , ,3 Discontinued operation 27,0 123 (119,4) (848,4) Headline earnings per share (cents) 974, , ,5 Continuing operations 977,8 974, ,0 Discontinued operation (3,2) 97 (121,7) (305,5) Diluted headline earnings per share (cents) 961, , ,7 Continuing operations 964, , ,3 Discontinued operation (3,2) 97 (119,3) (300,6) * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details. #Restated as required by IFRS 5 in relation to the treatment of Tiger Branded Consumer Goods plc (TBCG) as a discontinued operation.

10 group results and dividend declaration for the Interim condensed consolidated statement of comprehensive income year Change 30 September 2016 % Profit for the period 1 707, ,5 942,0 Other comprehensive income, net of tax 61,4 135 (175,8) 299,2 Net gain on hedge of net investment in foreign operation 1 0,4 (97) 13,4 7,6 Foreign currency translation adjustments 1 (44,9) 72 (161,9) 90,5 Share of associates other comprehensive income 1 131,7 281,7 Net (loss)/gain on cash flow hedges 1 (14,7) (765) (1,7) 7,0 Net loss on available-for-sale financial assets 1 (11,1) 57 (25,6) (91,3) Remeasurement raised in terms of IAS 19R (14,5) Tax effect 18,2 Total comprehensive income for the period 1 769, , ,2 Attributable to: Owners of the parent 1 766, , ,1 Non-controlling interest 2,9 102 (167,2) (753,9) 1 769, , ,2 Note 1 Items that may be subsequently reclassified to profit or loss. During the current period, R99,1 million of the foreign currency translation reserve, relating to TBCG, was reclassified to profit and loss (abnormal items), as well as R0,5 million on the available-for-sale financial asset derecognised in terms of the Black Managers Trust Participation Rights Scheme was reclassified to profit or loss.

11 group results and dividend declaration for the Interim condensed consolidated statement of financial position 2016 year 30 September ASSETS Non-current assets , , ,0 Property, plant and equipment 4 227, , ,2 Goodwill 2 243, , ,1 Intangible assets 1 991, , ,9 Investments 4 641, , ,3 Deferred taxation asset 57,0 303,5 50,5 Current assets , , ,3 Inventories 5 856, , ,0 Trade and other receivables 4 690, , ,7 Cash and cash equivalents 869,0 553, ,6 Total assets , , ,3 EQUITY AND LIABILITIES Total equity , , ,6 Issued capital and reserves , , ,1 Non-controlling interests 534,9 566,4 (52,5) Non-current liabilities 2 033, , ,2 Deferred taxation liability 243,5 308,6 200,3 Provision for post-retirement medical aid 651,5 637,0 643,1 Long-term borrowings 1 138,0 367, ,8 Current liabilities 7 392, , ,5 Trade and other payables 4 539, , ,8 Provisions 395,4 565,9 523,3 Taxation 30,8 112,0 73,4 Short-term borrowings 2 426, , ,0 Total equity and liabilities , , ,3 Net debt 2 695, , ,2

12 Interim condensed consolidated segmental information group results and dividend declaration for the year 30 September 2016 Change % Restated* Restated* Turnover Domestic operations , , ,6 Grains 6 157, , ,4 Milling and baking 4 302, , ,5 Other Grains 1 855, , ,9 Consumer Brands Food 5 788, , ,1 Groceries 2 564, , ,4 Snacks & Treats 1 116, , ,1 Beverages 757, , ,8 Value Added Meat Products 1 099, , ,1 Out of Home 239, ,9 443,7 Home, Personal Care and Baby (HPCB) 1 316, , ,1 Personal Care 303, ,6 630,9 Babycare 443, ,7 803,0 Homecare 569, ,5 713,2 Exports and International 2 640, , ,4 Exports 790,2 (24) 1 038, ,4 International operations Central Africa 439, ,8 706,5 International operations East Africa 514, ,9 762,6 International operations West Africa** 241, ,8 412,0 Deciduous Fruit (LAF) 807, , ,0 Other intergroup sales (152,5) (68) (90,8) (158,1) Continuing operations , , ,0 Discontinued operation TBCG** 1 598, , ,6 Total turnover , , ,6 * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details. **Previously reported Nigeria segment has now been split between West Africa and the discontinued operation.

13 Interim condensed consolidated segmental information (continued) group results and dividend declaration for the year 30 September 2016 Change % Restated* Restated* Operating income before abnormal items Domestic operations 1 758, , ,2 Grains 881,1 (1) 889, ,8 Milling and baking 709,8 (4) 735, ,5 Other Grains 171, ,8 380,3 Consumer Brands Food 609, , ,9 Groceries 234, ,0 410,6 Snacks & Treats 147,0 (12) 166,8 314,9 Beverages 105, ,5 137,8 Value Added Meat Products 76, ,6 146,3 Out of Home 45,9 7 42,8 86,3 Home, Personal Care and Baby (HPCB) 272, ,9 443,6 Personal Care 47,0 (38) 75,2 129,7 Babycare 115, ,0 214,2 Homecare 110, ,7 99,7 Other (3,6) 45 (6,6) (7,1) Exports and International 292, ,8 461,7 Exports 128,4 (40) 212,9 338,0 International operations Central Africa 68, ,0 115,8 International operations East Africa 35,7 151 (69,4) (46,5) International operations West Africa** (32,5) (162) (12,4) (38,2) Deciduous Fruit (LAF) 92, ,7 92,6 Total operating income before IFRS 2 charges 2 051, , ,9 IFRS 2 charges (41,9) (17) (35,8) (29,2) Total operating income after IFRS 2 charges 2 009, , ,7 Discontinued operation TBCG** 63,2 126 (243,9) (392,5) Total operating income 2 072, , ,2 * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details. **Previously reported Nigeria segment has now been split between West Africa and the discontinued operation.

14 group results and dividend declaration for the Interim condensed consolidated statement of changes in equity Share capital and premium Nondistributable reserves Accumulated profits Balance at 1 October , , ,8 Profit for the period 1 339,4 Other comprehensive income (158,5) 139, , ,2 Issue of share capital and premium 9,1 Transfers between reserves 86,9 (86,9) Share-based payment Dividends on ordinary shares (net of dividend on treasury shares) (1 010,5) Sale of empowerment shares 1 Balance at 148, , ,8 Profit for the period 387,7 Other comprehensive income 436,2 (9,7) 148, , ,8 Subsidiary legal reserve transfer 3,3 (3,3) Transfers between reserves 189,9 (98,5) Share-based payment Dividends on ordinary shares (net of dividend on treasury shares) (564,1) Purchase of Tiger shares by empowerment entity Sale of empowerment shares 1 Balance at 30 September 148, , ,9 Profit for the period 1 703,3 Other comprehensive income 2 62,8 148, , ,2 Transfers between reserves 205,8 (205,8) Share-based payment Dividends on ordinary shares (net of dividend on treasury shares) (1 022,2) Disposal of subsidiary Sale of empowerment shares 1 Balance at , , ,2 Notes 1 Relates to the exercising of options vested post the December 2014 lock-in period in terms of the Black Managers Trust Participation Right Scheme. 2 During the current period, R99,1 million of the foreign currency translation reserve, relating to TBCG, was reclassified to profit and loss.

15 group results and dividend declaration for the Shares held by subsidiary and empowerment entities Share-based payment reserve Total attributable to owners of the parent Non-controlling interests Total equity (2 671,9) 424, ,4 769, , ,4 (149,9) 1 189,5 (158,5) (17,3) (175,8) (2 671,9) 424, ,3 602, ,9 9,1 9,1 39,2 39,2 39,2 (1 010,5) (1 010,5) 182,8 182,8 (36,2) 146,6 (2 489,1) 464, ,9 566, ,3 387,7 (635,2) (247,5) 426,5 48,5 475,0 (2 489,1) 464, ,1 (20,3) ,8 (91,4) 50,9 50,9 50,9 (564,1) (19,4) (583,5) (71,0) (71,0) (71,0) 21,2 21,2 (12,8) 8,4 (2 538,9) 423, ,1 (52,5) , ,3 4, ,6 62,8 (1,4) 61,4 (2 538,9) 423, ,2 (49,6) ,6 30,9 30,9 30,9 (1 022,2) (1 022,2) 587,6 587,6 11,3 11,3 (3,1) 8,2 (2 527,6) 454, ,2 534, ,1

16 group results and dividend declaration for the Interim condensed consolidated statement of cash flows 2016 Restated* year 30 September Restated* Cash operating profit 2 344, , ,4 Working capital changes (482,5) (744,7) (811,6) Cash generated from operations 1 861, , ,8 Finance cost net of dividends received 15,9 (38,7) (70,7) Taxation paid (601,3) (605,7) (1 158,8) Cash available from operations 1 276,4 775, ,3 Dividends paid (1 025,3) (1 046,7) (1 643,0) Net cash inflow/(outflow) from operating activities 251,1 (271,6) 712,3 Purchase of property, plant and equipment (257,0) (363,3) (881,6) Net cash on disposal of subsidiary 1 075,7 BMT shares exercised 12,6 215,3 285,7 Investment acquired (525,4) Other (5,7) 8,8 65,4 Net cash inflow/(outflow) from investing activities 825,6 (139,2) (1 055,9) Proceeds from issue of share capital 9,1 9,1 Long and short-term borrowings (repaid)/raised (8,7) (560,1) 66,9 Net cash (outflow)/inflow from financing activities (8,7) (551,0) 76,0 Net increase/(decrease) in cash and cash equivalents 1 068,0 (961,8) (267,6) Effect of exchange rate changes 7,3 (33,7) 66,7 Cash and cash equivalents at the beginning of the period (2 126,8) (1 925,9) (1 925,9) Cash and cash equivalents at the end of the period (1 051,5) (2 921,4) (2 126,8) Cash resources 869,0 553, ,6 Short-term borrowings regarded as cash and cash equivalents (1 920,5) (3 474,8) (3 178,4) (1 051,5) (2 921,4) (2 126,8) * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details. Other salient features 2016 year 30 September Capital commitments 730,3 479, ,4 contracted 80,0 122,7 148,5 approved 650,3 356,9 970,9 Capital commitments will be funded from normal operating cash flows and the utilisation of existing borrowing facilities. At 2016, the total capital commitments proposed but not yet approved amounted to R789,8 million. Capital expenditure 257,0 363,3 881,6 replacement 235,2 307,0 677,8 expansion 21,8 56,3 203,8 Contingent liabilities guarantees and contingent liabilities 3,0 14,8 16,9

17 Notes group results and dividend declaration for the Basis of preparation and changes to the group s accounting policies The preparation of these results has been supervised by O Ighodaro, Chief Financial Officer of Tiger Brands Limited. The condensed group interim consolidated financial statements for the 2016 have been prepared in accordance with IAS 34 Interim Financial Reporting as issued by the IASB, the South African Companies Act No 71 of 2008 and the Listings Requirements of the JSE Limited. These statements have not been audited or reviewed. The accounting policies adopted in the preparation of the interim consolidated financial statements are consistent with those applied in preparation of the group s annual consolidated financial statements for the year 30 September. A number of segments comprising international entities are included in the International Operations portion of Exports and International as they individually do not meet the qualitative thresholds indicated in IFRS 8 Operating Segments. The majority of the group s financial instruments measured at fair value in terms of IFRS 13, are noted as level 1 hierarchy, which are valued based on quoted market prices Restated* year 30 September Restated* 2. Operating income before abnormal items Depreciation (included in cost of sales and other operating expenses) (278,2) (250,1) (517,8) Amortisation (6,3) (11,8) (23,8) IFRS 2 (included in other operating expenses) Equity settled (30,9) (39,2) (90,1) Cash settled (11,0) 3,4 60,9 3. Abnormal items Impairment of property, plant and equipment (3,2) (11,8) (39,8) Impairment of intangible assets (29,6) (280,0) Other (18,7) (3,2) (41,4) (338,5) 4. Impairment Goodwill and indefinite life intangible assets are tested for impairment annually (as at 30 September) and when circumstances indicate the carrying value may be impaired. The group s impairment tests are based on the value-in-use calculations. The key assumptions used to determine the recoverable amount for the different cash generating units were disclosed in the annual consolidated financial statements for the year 30 September. No impairment was recognised at 2016 relating to goodwill and indefinite life intangible assets. * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details.

18 group results and dividend declaration for the Notes (continued) 2016 Restated* year 30 September Restated* 5. Reconciliation between profit for the period and headline earnings Continuing operations Profit for the year attributable to owners of the parent 1 658, , ,4 Loss/(profit) on disposal of property, plant, equipment and intangible assets 0,1 (1,5) 9,8 Impairment of property, plant and equipment 2,3 8,3 32,9 Impairment of intangible assets 29,6 269,6 Other (49,7) Headline earnings adjustment Associates Profit on disposal of property, plant, equipment and intangible assets (73,1) (3,0) (3,0) 1 588, , ,0 Tax effect of headline earnings 19,5 2,9 (5,8) Attributable to non-controlling interest Discontinued operation Profit for the period attributable to owners of the parent 44,4 (195,8) (1 394,3) Loss on sale of property, plant and equipment 0,1 Profit on disposal of subsidiary (49,7) Impairment of property, plant and equipment 900,3 (5,2) (195,8) (494,0) Tax effect of headline earnings Attributable to non-controlling interest 309,2 * The comparatives have been restated for the retrospective reclassification relating to the treatment of foreign exchange gains and losses on foreign cash and bank balances previously included in operating income and now reclassified to finance costs. Refer note 7 for further details.

19 group results and dividend declaration for the Notes (continued) 2016 year 30 September 6. Analysis of profit from discontinued operation Profit for the period from discontinued operation (attributable to owners of the Company) Turnover 1 598, , ,6 Expenses (1 535,3) (1 585,6) (3 290,1) Operating income before abnormal items 63,2 (243,9) (392,5) Abnormal items 49,7 (1 371,1) Operating income after abnormal items 112,9 (243,9) (1 763,6) Finance costs (85,3) (79,3) (173,0) Profit before taxation 27,6 (323,2) (1 936,6) Taxation 7,5 (230,9) Profit for the period from discontinued operation 27,6 (315,7) (2 167,5) Attributable to non-controlling interest 16,8 119,9 773,2 Attributable to owners of parent 44,4 (195,8) (1 394,3) Cash flows from discontinued operation Net cash inflows/(outflows) from operating activities 271,1 35,8 (57,3) Net cash outflows from investing activities (38,6) (34,5) (116,8) Net cash inflows/(outflows) from financing activities 89,0 (166,4) 33,5 Net cash inflows/(outflows) 321,5 (165,1) (140,6)

20 group results and dividend declaration for the Notes (continued) 7. Reclassification of foreign exchange gains and losses 2016 year 30 September All foreign exchange gains and losses relating to revaluation of foreign cash balances and loans of a funding nature have been accounted for as finance related costs (refer note 8) and thus reclassified from operating income and into finance costs (retrospective application with comparatives restated to reflect the reclassification). The impact on the comparatives is as follows: Operating income after abnormal items As previously reported 1 590, ,1 Discontinued operation 243, ,6 Reclassification on finance costs 5,4 (20,5) Restated operating income from continuing operations after reclassification of finance costs 1 840, ,2 8. Net financing costs Net interest paid (149,3) (110,4) (224,5) Net foreign exchange gain/(losses) 31,7 (5,4) 20,5 Net financing costs (117,6) (115,8) (204,0)

21 Corporate information TIGER BRANDS LIMITED Registration number: 1944/017881/06 Incorporated in the Republic of South Africa Share code: TBS ISIN: ZAE Independent non-executive directors A C Parker (Chairman), B L Sibiya (Deputy Chairman), Y G H Suleman, S L Botha, K D K Mokhele, M P Nyama, R D Nisbet, M Makanjee, M J Bowman, M O Ajukwu Executive directors L C Mac Dougall (Chief Executive Officer) (appointed 10 May 2016), C F H Vaux, O Ighodaro (Chief Financial Officer), N P Doyle (Chief Operating Officer) Company Secretary T Naidoo Investor relations N Catrakilis-Wagner (011) Postal address PO Box 78056, Sandton, 2146, South Africa Telephone (011) Sponsor JP Morgan Equities South Africa (Pty) Limited 1 Fricker Road, Corner Hurlingham Road, Illovo, 2196 Share registrars Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, 2001 PO Box 61051, Marshalltown 2107, South Africa. Telephone (011) BASTION GRAPHICS

22 Tiger Brands Limited Registration number: 1944/017881/06 Incorporated in the Republic of South Africa Share code: TBS ISIN: ZAE Telephone: Facsimile: Physical address: Tiger Brands Limited 3010 William Nicol Drive, Bryanston Postal address: PO Box 78056, Sandton 2146, South Africa Website: