Bumper six months for Agra

Jo-Maré Duddy – Agra Limited weathered the Covid-19 storm in the six months ended 31 January 2021, reporting an increase of nearly 66% year-on-year in total comprehensive income.

The group, which trades over the counter (OTC) at the Namibian Stock Exchange (NSX), recorded an interim total comprehensive income of about N$26.2 million, up nearly N$10.4 million from the same six months in 2020.

“Fortunately, the agricultural industry, being a primary industry, has not been as negatively affected by the global pandemic as many other industries and for this we are extremely grateful,” the group said in its latest unaudited results released on the NSX.

Preliminary data from the Namibia Statistics Agency (NSA) shows agriculture, forestry and fishing grew by 5.9% year-on-year (y/y) in 2020, compared to -3.2% the year before. In contrast, Namibia’s overall economy grew by -8% y/y last year.

Crop farming and forestry recorded growth of 76.5% y/y following good rains, against -32% in 2019. Livestock farming, on the other hand, grew by -10.2% y/y, compared to 5.4% in 2019.

Agra said the severe drought that has plagued Namibia for the past several years has taught the group many lessons, allowing it to effectively overcome challenges and operate in an extremely difficult trading environment.

TURNOVER

Agra’s revenue for the six months under review totalled nearly N$945.2 million, down about N$47 million or nearly 4.8% y/y.

The group commented: “With the exception of the southern and western parts of Namibia, the country has received good rains, which resulted in a significant drop in sales of licks and feed.” It added: “As farmers are focusing on production and restocking herds, the landscape of agriculture has changed and as such, Agra had to adapt to the changing needs of our core market.”

Agra took “continuous precautions” to manage operational costs in the half-year under review. “This included temporarily putting on hold several capital projects, as well as not filling vacant positions for non-essential personnel,” according to the group.

As a result, operating expenses increased by only 0.5% y/y to nearly N$158.9 million.

“The profit before taxation increased from N$22.7 million in the 2020 financial year, to N$38.6 million in the 2021 period, which is a substantial increase of 69.4% for the first six months of the financial year,” Agra said.

During the current financial year, Agra decided to continue to invest in the expansion of infrastructure and to fill all vacant positions, it said.

ASSETS

The group’s annualised basic earnings per share (EPS) came in at 51.37c, 65% higher y/y.

Agra’s net asset value (NAV) per share for the six months under review was N$4.52, an y/y/ increase of nearly 7.9%.

At the end of January 2021, Agra’s total assets were about N$995.4 million, nearly 6.4% more than the end of January 2020. Cash and cash equivalents stood at about N$57.2 million, compared to a negative N$9.9 million in the same half-year in 2020.

The group’s reserves stood at around N$26.9 million, down 4.8% y/y. Agra managed to reduce its bank overdraft from nearly N$111.4 million to N$92.99 million.