CFI subsidiary, Crest Poultry Group exits judicial management

AGRO firm, CFI Holdings has announced that its subsidiary, the Crest Poultry Group exited judicial management shortly after the reporting period, last month.

BY TATIRA ZWINOIRA

CFI Holdings also announced its food processing entity, Victoria Foods, is expected to exit judicial management before the close of the FY2020 financial year.

The two companies were placed under judicial management in September 2016, to allow for debt restructuring, re-organisation and recapitalisation of the firms.

“Notwithstanding the constrained business environment, your board is pleased to advise that Crest Poultry Group exited judicial management shortly after the reporting period, in January 2020,” said CFI’S acting chairperson Itai Pasi, in a statement accompanying the group’s results for the year ended September 30, 2019.

“The Board equally looks forward to the imminent exit of Victoria Foods from judicial management before the close of the FY2020 financial year.”

The group raised a $42,5 million loan to fund the payment of Crest Poultry Group’s scheme creditors and moderate working capital funding required to re-launch the businesses now under its control.

“The Crest Poultry Group scheme of arrangement was approved by creditors in May 2019. The payments of amounts owed to scheme creditors were fully resolved shortly after year-end. Resolution of scheme’s foreign creditors is, however, still underway,” he said.

“The board anticipates resolution of the same before end of 1st quarter for FY2020. In the meantime, Agrifoods has made commendable progress in reclaiming market share.”

Regarding Victoria Foods, the group commenced settling all local legacy debts for the entity, pending resolution of the payment of the foreign debts.

“During the year, Victoria Foods continued with flour toll milling arrangements under the Judicial Manager’s control, with other strategic business units all remaining under care and maintenance,” Pasi said.

The group incurred costs of $38,9 million arising from the loan raised to finance the exit of entities from judicial management. Pasi added that disregarding financing costs associated with the cost of taking entities out of judicial management, “the businesses under the Board’s control in FY2019 were profitable in historical and restated terms”.

Entities under judicial management posted a profit before tax of $144 million against losses of $4,1 million incurred in the prior year with the improvement mainly attributable to monetary gains of $171.9 million during the year.

CFI Holdings, for the period under review, recorded an increase for its inflation-adjusted turnover of 25,2% to $347,8 million from a 2018 comparative of $277,9 million.