Total Produce plc

02/25/2021 | Press release | Distributed by Public on 02/25/2021 01:05

Total Produce records strong results in 2020

TOTAL PRODUCE PLC

2020 PRELIMINARY RESULTS

Total Produce records strong results in 2020

· Very strong performance in 2020 in the context of the unprecedented challenges posed by COVID-19 to the global economy

· The Group announced on 17 February 2021 an agreement to combine with Dole Food Company Inc under a newly created US listed company, Dole plc

· Total revenue up 1.7% to €6.259 billion

· Adjusted EBITDA up 8.2% to €219.4m

· Adjusted EBITA up 9.4% to €164.2m

· Adjusted profit before tax up 18.0% to €116.0m

· Adjusted fully diluted EPS up 9.1% to 15.41 cent

· The Group is in a strong financial position, net debt of €144.3m (2019: €221.2m)

· 7.5% increase in 2020 final dividend to 2.770 cent per share

Commenting on the results, Carl McCann, Chairman, said:

'The Group has reported strong results in 2020. Revenue grew 1.7% to €6.3 billion with an 8.2% increase in adjusted EBITDA to €219.4m and adjusted earnings per share increasing 9.1% to 15.41 cent. These strong results demonstrate the robustness of the Group's business model in the face of the unprecedented challenges posed by the ongoing COVID-19 pandemic. We are very proud of our people worldwide. Their dedication, commitment and hard work ensured the Group's supply chains and operations continue to function and remain open across our key markets.

On 17 February 2021, the Group announced a binding deal with Dole Food Company Inc to combine under a newly created US listed company, Dole plc. Dole plc will be the number one player in fresh produce with estimated combined revenues of almost US$10 billion, adjusted EBITDA of approximately US$379 million and total assets of approximately US$4.5 billion. The decision to list the new company in the United States marks an exciting next step. The combined company will become the largest player in fresh produce with a highly diversified portfolio, resilient earnings and a strong balance sheet that positions us well for accelerated growth. We look forward to beginning this next chapter and providing increased opportunity for our shareholders, dedicated employees, customers, suppliers and partners.

The Group intends to pay a final dividend of 2.770 cent per share representing an increase of 7.5%. Trading has been satisfactory in early 2021'.

25 February 2021

For further information, please contact:
Brian Bell, Wilson Hartnell PR - Tel: +353-1-669-0030, Mobile: +353-87-243-6130

Unaudited

2020

€'million

2019

€'million

change

Total revenue

6,259

6,1531

+1.7%

Group revenue

3,818

3,729

+2.4%

Adjusted EBITDA

219.4

202.8

+8.2%

Adjusted EBITA

164.2

150.1

+9.4%

Operating profit before exceptional items

93.4

82.3

+13.5%

Operating profit after exceptional items

83.4

87.5

(4.7%)

Adjusted profit before tax

116.0

98.3

+18.0%

Profit before tax (after exceptional items)

73.5

76.5

(4.0%)

1 the Group's share of the 2019 revenue of Dole was restated. See Note 3 of the accompanying financial information.

€'cent

€'cent

change

Adjusted fully diluted earnings per share

15.41

14.12

+9.1%

Basic earnings per share

10.40

13.72

(24.2%)

Diluted basic earnings per share

10.38

13.69

(24.2%)

Final dividend per share

2.770

2.5770

+7.5%

Total dividend per share

3.6829

3.4899

+5.5%

Overview

Total Produce (the 'Group') has delivered very strong results in 2020 against the backdrop of the unprecedented uncertainties and challenges in the global marketplace arising from the prolonged effects of the COVID-19 pandemic. The COVID-19 outbreak continues to be an ongoing challenge for the Group and the wider fresh produce industry. The health and wellbeing of our people is the Group's number one priority while at the same time recognising the vital role in continuing to keep the supply chains open and supplying essential foodstuffs. The Group's strong presence in the global fresh produce industry, the diversity of its operations and products together with the exceptional response from our people have enabled us to meet these challenges.

Total revenue grew 1.7% to €6,259m (2019: €6,153m), adjusted EBITDA increased by 8.2% to €219.4m (2019: €202.8m) with adjusted EBITA increasing 9.4% to €164.2m (2019: €150.1m). The increase in revenue was due to robust retail and wholesale demand offsetting reduced levels of activity in the food service sector. The Group also benefitted from the contribution of bolt-on acquisitions made in the past twelve months. Currency had a marginally negative impact on the translation of the overall results of foreign currency denominated operations to Euro due principally to the weakening of the US Dollar and to a lessor extent Sterling. On a like-for like basis excluding the impact of acquisitions, divestments and currency translation, revenues were circa 1% ahead of prior year with average price increases offsetting a modest volume decrease. The strong growth in adjusted EBITDA (8.2%) and adjusted EBITA (9.4%) was due to the robust performance in the Eurozone (particularly in H2 of 2020), the International and Dole divisions. This was partially offset by a weaker performance in the Non-Eurozone division which has a proportionally higher wholesale and direct food service business.

Operating profit before exceptional items increased by 13.5% to €93.4m (2019: €82.3m). The operating profit after exceptional items was €83.4m (2019: €87.5m) with the decrease due to the effect of exceptional items year on year. The 2019 prior year included exceptional gains of €5.2m compared to a current year charge of €10.0m, as discussed further in Note 5 of the accompanying financial information.

Adjusted fully diluted earnings per share increased 9.1% to 15.41 cent (2019: 14.12 cent), due to the 9.4% increase in adjusted EBITA and lower interest charges offset by higher non-controlling interest charges.

Net debt at end of the year was €144.3m (2019: €221.2m) with strong adjusted operating cashflow of €113.6m (2019: €59.4m) due to strong earnings growth and working capital inflows of €52.1m (2019: €6.6m). The working capital inflow was due to the change in customer mix and tight working capital management. The Group managed its liquidity by curtailing some non-essential capital expenditure and discretionary costs. The Group is in a strong financial position with significant financial capacity. The Group is operating comfortably within its bank covenants and enjoys the support of its banking partners.

The Group paid the 2020 interim dividend of 0.9129 cent per share, unchanged on the prior year, on 29 January 2021.The Group intends to pay a final dividend of 2.770 cent per share in May 2021, representing an increase of 7.5% on 2019. The total dividend for 2020 will amount to 3.6829 (2019: 3.4899) cent per share and represents an increase of 5.5% on 2019. The total dividend represents a pay-out of almost 24% of the adjusted earnings per share.

_______________________________________

Alternative performance measures 'APMs' The Group uses APMs, which are non-IFRS measures to monitor financial performance. These measures are referred to throughout the discussion of our reported operating performance and financial position and are measures which are regularly reviewed by Group management in assessing Group performance. The APMs are defined together with calculations in pages 33to 36of this statement.

Transaction to combine with Dole Food Company Inc and become publicly listed in the US

On 17 February 2021, the Group, Dole Food Company, Inc. ('Dole'), and affiliates of Castle & Cooke, Inc. (the 'C&C shareholders'), which own a 55% interest in Dole's parent company ('Dole Holdings') (together, the 'Parties'), announced that they entered into a binding transaction agreement (the 'Agreement') to combine under a newly created, U.S. listed company ('Dole plc') (the 'Transaction').

The Group had previously completed the acquisition of a 45% interest in Dole on 31 July 2018 with options to acquire the remaining 55% in future years.

The Transaction will simplify the existing structure between the two companies by unifying Dole and Total Produce under common ownership, with the objective of enabling full operational integration, realisation of synergies and value creation across the enlarged business. Under the terms of the Agreement, Total Produce shareholders will receive 82.5% of Dole plc shares and the C&C shareholders will receive 17.5% of Dole plc shares, in each case based on the fully diluted outstanding shares immediately prior to the completion of the Transaction.

Dole plc will be well positioned to deliver attractive long-term growth and utilise its increased size and network to drive market penetration and cross-selling. Dole plc will benefit from the strength of the Dole brand to further expand its product offering and pursue synergistic M&A in a fragmented and structurally growing industry.

Dole plc will have a balanced geographic presence with an extensive and diversified product portfolio, enhancing the overall financial resilience of the business.

Per the Agreement, Dole plc's completion of an initial public offering and a listing on a major U.S. stock exchange is a condition for completion of the Transaction (the 'IPO'). In connection with the Transaction, Dole plc intends to target raising US$500 to US$700 million in primary equity capital to strengthen and de-lever the combined balance sheet. Upon completion of the U.S. listing of Dole plc, Total Produce will cease to be listed on the Euronext Dublin and the London Stock Exchange.

Total Produce has secured fully committed debt facilities to backstop and refinance all existing Total Produce and Dole debt facilities upon completion of the Transaction, with the exception of the Dole vessel financing and certain other bilateral facilities which will remain post completion. Overall, this is expected to provide for a stronger balance sheet with a well-termed out capital structure, which is expected to enhance Dole plc's credit profile and lower its average cost of capital going forward.

Dole plc, operating under the Dole brand, will be incorporated in Ireland, with its Global Headquarters in Dublin, Ireland. Its headquarters for the Americas will be in Charlotte, North Carolina.

The highly regarded management teams of Total Produce and Dole, with combined experience of over 150 years in the fresh produce sector, will continue to operate the combined business.

The Transaction is subject to approval by Total Produce shareholders, regulatory approvals, market conditions and customary conditions.

Should the Transaction fail to complete for any reason the terms of the Initial Dole Transaction remain in place and Total Produce will continue to be listed on Euronext Dublin and the London Stock Exchange.

The full terms of the Transaction are outlined in the Stock Exchange announcement on 17 February 2021.

Operating Review

The table below details a segmental breakdown of the Group's total revenue and adjusted EBITA for the year ended 31 December 2020. The European and International operating segments are primarily involved in the procurement, marketing and distribution of hundreds of lines of fresh fruit and vegetables. The Group's 45% share of the results of Dole is included as a separate operating segment. Dole is one of the world's leading fresh producers, marketers and distributors of fresh fruit and vegetables, which sell and distribute through a wide network in North America, Europe, Latin America, the Middle East and Africa. Segment performance is evaluated based on total revenue and adjusted EBITA.

Unaudited 2020

2019**

Total

revenue

Adjusted

EBITA

Total

revenue

Adjusted

EBITA

€'000

€'000

€'000

€'000

Europe - Non-Eurozone

1,499,299

39,390

1,481,657

41,913

Europe - Eurozone

1,687,370

28,708

1,661,446

20,477

International

1,295,949

26,012

1,271,566

22,284

Dole* (Group share)

1,843,402

70,128

1,801,299

65,440

Inter-segment revenue

(66,522)

-

(62,874)

-

Total Group

6,259,498

164,238

6,153,094

150,114

*Dole's financial year for 2020 commenced on 29 December 2019 and ended on 31 December 2020. The 2019 comparative period ran from 29 December 2018 to 28 December 2019. The Group's share of the adjusted EBITA of Dole is after the deduction of the Group's share of the non-controlling interests charge within Dole and an allocation of a corporate overhead.

** The 2019 segmental comparatives have been restated to conform with the current year's presentation. In addition, the Group's share of the 2019 revenue of Dole was restated. See Note 3 of the accompanying financial information.

Total revenue increased 1.7% to €6,259m (2019: €6,153m) with robust demand from retailers and wholesalers offsetting reduced levels of activity in the food service sector. Across the Group companies modified sales strategies to further increase retail focus and to source more produce to meet increased retail demand. There was an increase in demand for the staple items, bananas, potatoes, vegetables and produce with high vitamin C content (citrus and kiwi fruit) with reduced demand for pineapples and melons due to lower foodservice activity. The Group also benefitted from bolt-on acquisitions made in the past twelve months. Currency had a marginally negative impact on the translation of the overall results of foreign currency denominated operations to Euro in the year primarily due to the weakening of the US Dollar. On a like-for like basis excluding the impact of acquisitions, divestments and currency translation, revenues were circa 1% ahead of prior year with average price increases offsetting a modest volume decrease. Adjusted EBITA increased 9.4% to €164.2m (2019: €150.1m) due to strong performance in the Eurozone (particularly in H2 of 2020), the International and Dole divisions. This was partially offset by a weaker performance in the Non-Eurozone division which has a higher proportionate concentration of wholesale and direct food service business.

Within the European and International divisions, there were additional operating costs relating to COVID-19 such as employee personal protective equipment and costs of additional shifts in warehouses to comply with physical distancing. These additional costs were offset by reductions in other costs such as travel expenses. Within the Dole division certain one-off costs associated with COVID-19 were incurred and classified as exceptional items. The Group's 45% of these non-recurring COVID-19 costs were €4.4m.

Europe - Non-Eurozone

This segment includes the Group's businesses in the Czech Republic, Poland, Scandinavia and the UK. Revenue increased by 1.2% to €1,499m (2019: €1,482m) helped by the incremental impact of bolt-on acquisitions. Currency translation had a marginal negative impact on revenue on translation to Euro with weaker Sterling partially offset by a strong Swedish Krona. On a like-for-like basis excluding acquisitions, divestments and current translation revenue was circa 1% behind prior year with volume decreases offset in part by average price increases. Volume decreases are due to reduced demand in the food service sector in Scandinavia, the UK and the Czech Republic as a result of restrictions imposed due to COVID-19. This was offset by robust demand from retail, as well as an element of organic growth. Adjusted EBITA decreased 6.0% to €39.4m (2019: €41.9m) due to currency translation and an impact on margin due to a change in sales channel.

Europe - Eurozone

This segment includes the Group's businesses in France, Ireland, Italy, the Netherlands and Spain. Revenue increased by 1.6% to €1,687m (2019: €1,661m). Excluding the effect of acquisitions and divestments, revenue on a like-for-like basis was circa 1% ahead of prior year with average price increases offsetting a decrease in volumes. Throughout the Eurozone, robust retail and wholesale demand offset lower demand from the food service sector. Adjusted EBITA increased 40.2% to €28.7m (2019: €20.5m) with a resilient performance across all divisions particularly Spain and an overall much improved result in Holland. The Dutch horticultural division remained challenged with disappointing performance in vegetables offset by good results in the second half of the year from sales of local soft fruit and deciduous product. The Group recorded strong performance particularly in the second half of the year in its import business helped by solid results in its mango, citrus, ginger and avocado lines.

International

This division includes the Group's businesses in North America, South America and India. Revenue increased by 1.9% to €1,296m (2019: €1,272m). Currency negatively impacted on translation of the results to Euro due to the weakening of US Dollar and Canadian Dollar by 1.9% and 3.3% respectively. This was partially offset by the benefit of an increase in the shareholding in a joint venture which is now treated as a subsidiary. On a like-for-like basis excluding the effects of currency and acquisitions, revenue increased circa 3% due to average price increases with volumes marginally behind the prior year. The International division is largely retail focussed. There was an increase in demand for the staple items of potatoes, vegetables, citrus as well as kiwifruit. The impact of COVID-19 in the first half of the year saw a reduced demand for more expensive product and produce with a shorter shelf life. Revenue strengthened in second half of the year particularly with stronger pricing in certain product lines and good volumes from new product sources. Adjusted EBITA increased 16.7% to €26.0m (2019: €22.3m) with improved margins, lower operating costs (primarily travel related), the benefit of a joint venture becoming a subsidiary offset in part by the negative impact on the translation of the results of US Dollar and Canadian Dollar denominated earnings to Euro.

Dole

This segment includes the Group's share of the results of Dole. The Group is equity accounting for its 45% share of the resultsof Dole on an IFRS basis.

Dole's 2020 financial year was from 29 December 2019 to 31 December 2020 and for 2019 was from 29 December 2018 to 28 December 2019. Dole's overall business is seasonal, with the greater shareofadjusted EBITA earned in the first half of the financial year. As Dole is vertically integrated its operations are sensitive to a number of factors including weather related phenomena and the effects on industry volumes, prices, produce quality and growing costs.Trading in Dole was good in the context of a challenging global environment due to COVID-19 and is benchmarked against a strong comparative year in the Fresh Vegetable division for some produce categories. On an IFRS basis, Dole has recorded 2020 revenues of $4,672m (€4,096m) up 3.5% on 2019 revenue of $4,516m (€4,003m). Adjusted EBITDA in 2020 of $259.2m (€230.6m) was 5.8% ahead of prior year result of $245.0m (€217.2m) with adjusted EBITA of $184.6m (€164.2m) 6.2% ahead when compared to $173.8m (€154.0m) recorded in the prior year.

The Fresh Fruit division (bananas and pineapples) remained strong and ahead of the prior period with higher banana volumes in Latin America and North America offset by some lower European volumes. The results in this division benefitted from lower fuel prices and some general cost efficiencies. This was offset by a general decrease in pineapple pricing due to the impact of COVID-19 on the food service sector.

Results in Fresh Vegetables were ahead of the prior period despite being benchmarked against a very strong comparative period in some categories. The results from value-added operations were significantly ahead of 2019 with favourable volumes and pricing helped by the launch of new product types and the change in product mix from a move to more premium products. The division also benefitted from cost saving initiatives implemented in recent years.

The Diversified division performed satisfactorily in the period. The results were helped by solid results in citrus and berries while results in Chile were impacted by timing differences in the crop harvest cycle of cherries as well as lower grape volumes due to drought.

Within the Dole segment, certain one-off charges associated with COVID-19 including costs of double shifts, protective equipment and additional transport were incurred and classified as exceptional items. These costs amounted to $10.8m (€9.6m) and primarily related to the Fresh Vegetable division.

Total Produce's 45% share of 2020 revenue was €1,843m (2019: €1,801m) and its share of adjusted EBITA was €70.1m (2019: €65.4m).

Further details on the financial performance and position of Dole for the year ended 31 December 2020 are outlined in Note 7 of the accompanying financial information.

Financial Review

Revenue and adjusted EBITA

An analysis of the factors influencing the changes in revenue and adjusted EBITA are discussed earlier in the operating review.

Share of profits of joint ventures - Dole

The Group's share of the after-tax profits of Dole in 2020 amounted to €21.3m (2019: €19.3m) before exceptional items. The increase is due to higher EBITA as noted earlier in the operating review offset in part by lower interest costs due to a decrease in the US LIBOR rate in 2020. The Group's share of exceptional items in 2020 was a €5.9m charge compared to a €7.0m gain in 2019. The gain in 2019 was primarily due to the gain on the sale of a European salad business. Further information on exceptional items are detailed in Note 5 of the accompanying financial information. Post exceptional items the Group's share of after-tax profits was €15.4m (2019: €26.4m). Further details of the performance of Dole and its financial position at the end of the year is outlined in the operating review and in Note 7 of the accompanying financial information.

Share of profits of joint ventures and associates - excluding Dole

Excluding the contribution from Dole the share of after-tax profits of joint ventures and associates increased in 2020 to €13.0m (2019: €11.3m). Dividends declared from joint ventures and associates in 2020 amounted to €12.5m (2019: €11.1m) with €11.3m (2019: €10.7m) received in cash reflecting the Group's continued focus on the cash contributions from these investments.

Intangible asset amortisation

Acquisition related intangible asset amortisation within subsidiaries amounted to €10.1m (2019: €10.3m). The share of intangible asset amortisation within joint ventures and associates was €2.5m (2019: €2.7m).

Exceptional items

Exceptional items in the year, net of tax amounted to a net charge of €10.9m (2019: €5.2m gain). The net charge in 2020 primarily relates to the Group's €5.9m share of the net charge within Dole (due primarily to exceptional COVID-19 costs and unrealised losses on foreign currency denominated intercompany borrowings). The Group also incurred a non-cash goodwill impairment charge of €3.5m and a property impairment charge of €1.1m. In 2019 the net gain primarily related to the Group's €7.0m share of the net gain within Dole on sale of a European salad business offset in part by Group restructuring charges.Afull analysisofexceptional itemsfor both 2020 and 2019 are set out in Note5 of the accompanying financial information and have beenexcludedfrom the calculationof theadjustednumbers.

Operating profit

Operating profit before exceptional items increased by 13.5% to €93.4m (2019: €82.3m) due to earnings growth in the Eurozone and International divisions as well as an increase in the Group's share of earnings in Dole. Including exceptional items, operating profit decreased to €83.4m (2019: increased to €87.5m) with the decrease due to the effect of exceptional items year on year. The prior year included exceptional gains of €5.2m compared to a current year charge of €10.0m before tax. As noted earlier, afull analysisofexceptional itemsfor both 2020 and 2019 are set out in Note5 of the accompanying financial information.

Net financial expense

Net financial expense in the year decreased to €9.9m (2019: €11.0m) primarily due to the fall in US LIBOR rates and lower average net debt in the year.

The Group's share of the net interest expense of joint ventures and associates in 2020 was €38.3m (2019: €40.8m) with the decrease due to Group's share of a lower interest charge in Dole due to reduction in US LIBOR rates in the year.

Profit before tax

Excluding acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration and share of joint venture interest and tax which is netted in profit before tax in the statutory income statement, the adjusted profit before tax increased by 18.0% to €116.0m (2019: €98.3m) with the benefit of the increase in the adjusted EBITA and the effect of lower interest charges. Statutory profit before tax after these items was €73.5m (2019: €76.5m) with the decrease due to the impact of exceptional items year on year. As noted earlier, there was a net exceptional charge of €10.0m before tax (2019: net gain of €5.2m).

Taxation

The adjusted tax charge for 2020, including the Group's share of joint ventures and associates' tax and before non-trading items as set out on page 34 of the accompanying financial information was €36.4m (2019: €27.9m) representing an underlying effective tax rate of 31.4% (2019: 28.0%) when applied to the Group's adjusted profit before tax.

Non-controlling interests

The non-controlling interests' share of after-tax profits in the year was €16.4m (2019: €12.9m). Included in this was the non-controlling interests' share of the net charge on exceptional items, amortisation charges and acquisition related costs (net of tax) of €3.3m (2019: €2.9m). Excluding these non-trading items, the non-controlling interests' share of adjusted after tax profits was €19.7m (2019: €15.8m) with the €3.9m increase due to higher non-controlling interests' share of earnings in certain non-wholly owned companies in Europe and North America.

Adjusted and basic earnings per share

Adjusted fully diluted earnings per share increased 9.1% to 15.41 cent (2019: 14.12 cent) due to the strong increase in adjusted EBITA in the year, lower interest charges offset by the increase in the non-controlling interest charge noted earlier.

Management believes that adjusted fully diluted earnings per share, which excludes acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings, exceptional items and the related tax on these items, provides a fairer reflection of the underlying trading performance of the Group.

Basic earnings per share and diluted earnings per share after these non-trading items amounted to 10.40 cent per share (2019: 13.72 cent) and 10.38 cent per share (2019: 13.69 cent) respectively. The decrease on the prior year is due to the exceptional one-off gains in 2019 compared to the 2020 exceptional charges as noted earlier.

Note 6 of the accompanying financial information provide details of the calculation of the respective earnings per share amounts.

Cashflow and net debt

Net debt (which excludes lease liabilities) at 31 December 2020 of €144.3m decreased on the prior year balance of €221.2m. Average net debt for year was €224.1m (2019: €284.0m). In addition, the Group has non-recourse trade receivables financing of €47.0m on 31 December 2020 (2019: €46.4m). The decrease in net debt on the prior year was primarily due to strong operating cashflows in 2020 and working capital inflows during the year as explained below.

The Group generated adjusted operating cashflows in the year of €61.5m (2019: €52.8m) with the increase due to the strong earnings growth. There was a positive working capital inflow of €52.1m (2019: €6.6m) primarily from the impact of a change in customer mix on receivables days and continued tight working capital management. In addition, there were initiatives and actions taken by the Group to protect the business and mitigate cash outflows due to COVID-19 with a deferral of some non-essential capital expenditure and curtailment of discretionary costs.

Cash outflows on routine capital expenditure, net of disposals, were lower at €15.4m (2019: €19.0m) due to the deferral of some non-essential capital expenditure. Dividends received from joint ventures and associates in the year were €11.3m (2019: €10.7m) representing the Group's continued focus on cash returns from these investments. Dividends paid to non-controlling interests were €20.5m (2019: €16.1m) with the increase due to higher earnings in subsidiaries with non-controlling interests.

Free cashflow generated by the Group was €89.0m (2019: €35.0m) with the increase due to higher earnings and the improved working capital inflow during the year. Free cashflow is the measure of the funds available after outflows relating to routine capital expenditure, dividends to non-controlling interests but before acquisition related expenditure, non-routine capital expenditure and the payment of dividends to equity shareholders of the Group.

Cash inflows from exceptional items were €0.8m (2019: €5.8m). Cash inflows from disposals net of acquisitions amounted to €1.5m (2019: €14.5m outflow) with proceeds from disposals of equity investments in the year offset by the costs of some bolt-on acquisitions primarily in the Eurozone. Payments relating to put option liabilities and contingent and deferred consideration relating to prior year acquisitions were €10.6m (2019: €11.1m). Payments for non-routine property and plant additions amounted to €4.2m (2019: €4.5m). Dividends paid to equity shareholders were €10.0m (2019: €13.3m) with the decrease due to the deferral of the 2020 interim dividend of €3.5m to January 2021. At 31 December 2020, there was a €11.4m gain (2019: €2.7m loss) on the translation of foreign currency denominated net debt to Euro due primarily to the weaker US Dollar and Sterling exchange rates prevailing at year end offset in part by the stronger Swedish Krona.

Unaudited

2020

2019

€'million

€'million

Adjusted EBITDA1

219.4

202.8

Deduct adjusted EBITDA of joint ventures and associates

(128.8)

(121.1)

Net financial expense and tax paid

(27.2)

(26.3)

Other

(1.9)

(2.6)

Adjusted operating cashflows before working capital movements

61.5

52.8

Working capital movements

52.1

6.6

Adjusted operating cashflows1

113.6

59.4

Routine capital expenditure net of routine disposal proceeds1

(15.4)

(19.0)

Dividends received from joint ventures and associates

11.3

10.7

Dividends paid to non-controlling interests

(20.5)

(16.1)

Free cashflow1

89.0

35.0

Cashflows from exceptional items

0.8

5.8

Cashflow receipts/(payments) from acquisitions, net of disposals1

1.5

(14.5)

Net (debt)/cash assumed on acquisition of subsidiaries

(1.0)

2.1

Contingent, and deferred consideration and put options payments

(10.6)

(11.1)

Non-routine capital expenditure

(4.2)

(4.5)

Dividends paid to equity shareholders

(10.0)

(13.3)

Other

-

0.1

Total net debt movement in year

65.5

(0.4)

Net debt1at beginning of year

(221.2)

(219.7)

Finance leases reclassified to lease liabilities

-

1.6

Foreign currency translation

11.4

(2.7)

Net debt1at end ofyear

(144.3)

(221.2)

1The APMs are defined together with calculations in pages 33to 36of this statement

Liquidity

It has always been the policy of the Group to have adequate facilities available providing the Group with sufficient headroom in addition to the flexibility to take advantage of opportunities to develop the business. As the pandemic hit global markets in mid-March, the Group took a number of steps to protect its liquidity and financial position. As described earlier, the Group postponed or deferred some non-essential capital expenditure and discretionary costs.

In 2020, the Group increased the tenor of its corporate borrowing facilities and provided additional headroom including the renewal of a three-year private placement facility of US$66m (€54m). This allows the Group to draw down long term funding for periods of up to twelve years. The Group has approved committed and uncommitted bank borrowings of up to €583m at 31 December 2020 (2019: €623m) in addition to approved overdrafts of €115m (2019: €109m). At 31 December 2020, the Group has utilised 39% of these facilities (2019: 46%). In addition, at 31 December 2020 the Group has cash and deposit balances of €131m (2019: €116m).

Post year end, in conjunction with the combination with Dole and the initial public offering and listing of Dole plc as described earlier, the Group has secured a committed debt facility with a term of five years to backstop and refinance certain existing Total Produce facilities in advance of the completion of the Transaction. In the event that the Transaction does not complete, this committed financing shall remain in place in the Total Produce Group.

Defined benefit pension obligations

The net liability of the Group's defined benefit pension schemes (net of deferred tax) was €14.3m on 31 December 2020 (2019: €9.3m). The increase in the liability was due to a decrease in the Eurozone and UK discount rates which increases the net present value of scheme obligations. This was offset by an average return of 7.5% on pension scheme assets in 2020. Other post-employment benefit obligations increased to €6.6m at 31 December 2020 (31 December 2019: €5.9m).

Shareholders' equity

Shareholders' equity increased by €7.5m in year to €458.6m. The increase was due to profit after tax of €40.4m attributable to equity shareholders. This was offset primarily by currency translation loss of €21.7m on the retranslation of the net assets of foreign currency denominated operations into Euro (primarily due to weaker US Dollar and Sterling) and remeasurement losses of €6.8m (net of deferred tax) on post-employment benefit schemes.

Development Activity

The Group made some bolt-on acquisitions in 2020, investments in existing joint ventures as well as acquisition of additional shares in non-wholly owned subsidiaries. The investments were in the Eurozone and International divisions and included the acquisition of additional shares in Eco Farms, a company based in California in the United States that specialises in avocados. This resulted in Eco Farms being consolidated as a subsidiary of the Group. The initial 45% interest was treated as a joint venture up to April 2020.

The total committed investment in the year was €5.8m including €0.6m contingent consideration payable on the achievement of future profit targets. The total investment included €3.6m related to the acquisition of the remaining shares in a subsidiary that were subject to a put and call option.

Dividends

The 2019 final dividend of 2.5770 was paid on 2 September 2020. The payment of the 2020 interim dividend of 0.9129 cent per share (which was unchanged on prior year) was paid post year-end on 29 January 2021.

The Group intends to pay a final dividend of 2.770 cent per share in May 2021 representing a 7.5% increase on 2019. The total dividend for 2020 will amount to 3.6829 (2019: 3.4899) cent per share and represents an increase of 5.5% on 2019. The total dividend represents a pay-out of almost 24% of the adjusted earnings per share.

Post Balance Sheet Events

The payment of the 2020 interim dividend of 0.9129 cent per share was paid post year-end on 29 January 2021. The total dividend amounted to €3,549,000.

On 17 February 2021, the Group and Dole Food Company Inc and affiliates of Castle & Cooke, Inc. (the 'C&C shareholders'), which own a 55% interest in Dole's parent company ('Dole Holdings') (together, the 'Parties'), announced that they entered into a binding transaction agreement (the 'Agreement') to combine under a newly created, U.S. listed company ('Dole plc') (the 'Transaction'). Further details are outlined on page 3 and in the Stock Exchange announcement on 17 February 2021. The Group has secured a committed debt facility with a term of 5 years to backstop and refinance certain existing Total Produce facilities in advance of the completion of the Transaction. In the event that the Transaction does not complete this committed financing shall remain in place in the Total Produce Group.

Environmental, Social and Governance (ESG)

In Total Produce we are privileged to market the most nutritious of foods with the lowest environmental impact. Committed to transparency and the adherence to best agronomic and sustainable practices across our operations, our journey towards becoming an ever more sustainable business is ongoing. Having invested in solar power installations in Brazil and the Netherlands in late 2020 and early 2021, the group's UK operations completed the transition to 100% 'Deep Green' renewable electric energy sources to power its twenty four business units across Great Britain in February 2021. Part of 'Vision 20/25', Total Produce's company-wide initiative dedicated to measuring and reducing carbon consumption throughout the group internationally, which has delivered an 18% reduction in group carbon emissions since 2018. This transition is expected to deliver a 20% reduction in TPUK's Co2 emissions throughout 2021 and beyond.

The adoption of renewable energy in the UK follows the launch in December 2020 of the group's sustainability website; www.totalproduce.com/sustainability. Dedicated to detailing Environmental, Ethical & Social and Economic practices across Total Produce, the site is a user friendly, central online resource through which stakeholders can download and review all of the content available in the Total Produce Sustainability Report. It further outlines the Group's approach to sustainability, its strategy, internal processes, targets and accomplishments to date alongside the policies, protocols and procedures are in place and up to date news on sustainability initiatives taking place across the Group.

In November 2020 Total Produce's commitment to best sustainable practices was recognised with the award of the prestigious Origin Green Gold standard, the only Irish fruit company to receive this accolade. Dedicated to recognising excellence in sustainability practices, Origin Green is operated by Bord Bia, the Irish Food Board. At its heart lies a comprehensive programme based on the setting of ambitious sustainability related targets and ongoing performance measurement.

Brexit and International Trade

The UK exited the European Union ('Brexit') in January 2021 after an 11-month transition period. It is still too early to assess the long-term implications of the UK departure from EU on the global fresh produce industry. Brexit committees set up in relevant areas of the business continue to monitor and assess the risks and opportunities from Brexit and have taken actions where appropriate. For example, the Group had ensured that product is transported directly from mainland Europe primarily Spain, France and Holland to avoid the UK land bridge.

COVID-19 Outbreak

Since the outbreak of COVID-19 all parts of our business have continued to work tirelessly to safely supply fresh produce to our customers. It is due to the efforts of our people that we have been able to join frontline workers and help feed consumers. The health and safety of all colleagues across the business is at the forefront of our thinking with the introduction of safe working practices. We have participated in helping local communities including supplying food packages to frontline healthcare workers, providing fruit to those in need, loaning vehicles to transport meals to the homeless and donating fresh produce to local food banks.

Going Concern

The Directors have reviewed forecasts and projected cashflows for a period not less than 12 months from the date of these financial statements. Consumer demand for fresh produce has remained robust through the pandemic and this is expected to continue. As highlighted earlier, when the pandemic hit in mid-March 2020, the Group took a number of steps to protect its liquidity and financial position. The Group has also increased the tenor of its corporate borrowing facilities providing additional comfort. Taking all these factors into consideration, the Directors are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they have adopted the going concern basis in preparing the financial statements.

Board Changes

Frank Gernon, Executive Director, and Jerome Kennedy, Non-Executive retired as Directors on 31 March 2020. On 1 December 2020, the Group announced that Seamus Taaffe had indicated his intention to retire as a Non-Executive Director and formally retired on 5 January 2021. The Board currently comprises of five independent Non-Executive Directors and three Executive Directors.

Frank has been an integral part of our Group for over 45 years and has served as an Executive Director of Total Produce since 2007. His outstanding service, dedication and accomplishments have been invaluable. During his tenure he has played a key role in the stewardship and development of the Group.

Jerome has served as a Non-executive Director on the Board and its Committees since the formation of Total Produce Plc. The Group has benefitted greatly from his business acumen, professionalism and wise counsel over the years.

Seamus joined the Board as Non-Executive Director in 2012 and the Group has benefitted greatly from his experience and guidance over the years.

I join the Board in extending to Frank, Jerome and Seamus our sincerest appreciation for their dedication and commitment. Their valuable contributions have added greatly to the success of Total Produce. We wish them the very best for the future.

Summary and Outlook

The Group has reported strong results in 2020. Revenue grew 1.7% to €6.3 billion with an 8.2% increase in adjusted EBITDA to €219.4m and adjusted earnings per share increasing 9.1% to 15.41 cent. These strong results demonstrate the robustness of the Group's business model in the face of the unprecedented challenges posed by the ongoing COVID-19 pandemic. We are very proud of our people worldwide. Their dedication, commitment and hard work ensured the Group's supply chains and operations continue to function and remain open across our key markets.

On 17 February 2021, the Group announced a binding deal with Dole Food Company Inc to combine under a newly created US listed company, Dole plc. Dole plc will be the number one player in fresh produce with estimated combined revenues of almost US$10 billion, adjusted EBITDA of approximately US$379 million and total assets of approximately US$4.5 billion. The decision to list the new company in the United States marks an exciting next step. The combined company will become the largest player in fresh produce with a highly diversified portfolio, resilient earnings and a strong balance sheet that positions us well for accelerated growth. We look forward to beginning this next chapter and providing increased opportunity for our shareholders, dedicated employees, customers, suppliers and partners.

The Group intends to pay a final dividend of 2.770 cent per share representing an increase of 7.5%. Trading has been satisfactory in early 2021.

Carl McCann, Chairman

On behalf of the Board

25 February 2021

Forward-looking statement

Any forward-looking statements made in this announcement have been made in good faith based on the information available as of the date of this announcement and are not guarantees of future performance. Actual results or developments may differ materially from the expectations expressed or implied in these statements, and the Company undertakes no obligation to update any such statements whether as a result of new information, future events, or otherwise. Total Produce's Annual Report contains and identifies important factors that could cause these developments or the Company's actual results to differ materially from those expressed or implied in these forward-looking statements.

Group Income Statement

for the year ended 31 December 2020

Note

Unaudited

Before exceptional items

2020

€'000

Unaudited

Exceptional items

(Note 5)

2020

€'000

Unaudited

Total

2020

€'000

Before exceptional items

2019

€'000

Exceptional items

(Note 5) 2019

€'000

Total

2019

€'000

Group revenue

3

3,817,585

-

3,817,585

3,729,346

-

3,729,346

Cost of sales

(3,283,008)

-

(3,283,008)

(3,212,057)

-

(3,212,057)

Gross profit

534,577

-

534,577

517,289

-

517,289

Operating expenses (net)

(465,338)

(4,062)

(469,400)

(455,371)

(1,816)

(457,187)

Share of profit of joint ventures - Dole

7

21,292

(5,908)

15,384

19,327

7,048

26,375

Share of profit of joint ventures - Other

12,051

-

12,051

10,658

-

10,658

Share of profit of associates

954

-

954

666

-

666

Operating profit before acquisition related intangible asset amortisation

103,536

(9,970)

93,566

92,569

5,232

97,801

Acquisition related intangible asset amortisation

(10,144)

-

(10,144)

(10,301)

-

(10,301)

Operating profit after acquisition related intangible asset amortisation

93,392

(9,970)

83,422

82,268

5,232

87,500

Financial income

2,287

-

2,287

2,754

-

2,754

Financial expense

(12,211)

-

(12,211)

(13,721)

-

(13,721)

Profit before tax

83,468

(9,970)

73,498

71,301

5,232

76,533

Income tax expense

(15,798)

(916)

(16,714)

(10,282)

(47)

(10,329)

Profit for the year

67,670

(10,886)

56,784

61,019

5,185

66,204

Attributable to:

Equity holders of the parent

40,412

53,302

Non-controlling interests

16,372

12,902

56,784

66,204

Earnings per ordinary share

Basic

6

10.40

13.72

Fully diluted

6

10.38

13.69

Group Statement of Comprehensive Income

for the year ended 31 December 2020

Unaudited

2020

€'000

2019

€'000

Profit for the year

56,784

66,204

Other comprehensive income:

Items that may be reclassified subsequently to profit or loss:

Foreign currency translation effects:

- foreign currency net investments - subsidiaries

(20,176)

5,664

- foreign currency net investments - joint ventures and associates

(17,681)

3,274

- foreign currency borrowings designated as net investment hedges

10,896

(3,397)

Effective portion of changes in fair value of cashflow hedges, net

(465)

(149)

Changes in fair value of cost of hedging, net of recycling

(91)

137

Deferred tax on items above

130

(9)

Share of joint ventures and associates effective portion of cashflow hedges

(1,723)

(5,101)

Share of joint ventures and associates deferred tax on items above

440

497

(28,670)

916

Items that will not be reclassified to profit or loss:

Remeasurement loss on employee benefit schemes

(9,003)

(3,009)

Revaluation gain on property, plant and equipment, net

11,440

2,095

Deferred tax on items above

(94)

(966)

Share of joint ventures gain on revaluation of property, plant and equipment

1,176

1,369

Share of joint ventures gain/(loss) on employee benefit schemes

429

(2,601)

Share of joint ventures deferred tax on items above

(110)

(75)

3,838

(3,187)

Other comprehensive expense for the year

(24,832)

(2,271)

Total comprehensive income for the year

31,952

63,933

Attributable to:

Equity holders of the parent

21,506

49,417

Non-controlling interests

10,446

14,516

31,952

63,933

Group Balance Sheet

as at 31 December 2020

Unaudited

2020

€'000

2019

€'000

Assets

Non-current

Property, plant and equipment

185,686

175,485

Right of use assets

119,242

113,032

Investment property

15,015

11,843

Goodwill and intangible assets

245,241

268,462

Investments in joint ventures and associates - Dole

265,744

264,893

Investments in joint ventures and associates - Other

96,677

104,050

Other investments

331

2,743

Other receivables

19,143

19,796

Deferred tax assets

18,514

13,497

Total non-current assets

965,593

973,801

Current

Inventories

111,962

98,031

Biological assets

2,895

3,965

Trade and other receivables

347,372

380,791

Other investments

-

2,306

Corporation tax receivables

2,394

2,439

Derivative financial instruments

4,083

4,489

Cash and cash equivalents

130,863

115,529

Total current assets

599,569

607,550

Total assets

1,565,162

1,581,351

Equity

Share capital

4,107

4,105

Share premium

295,619

295,487

Other reserves

(148,203)

(131,309)

Retained earnings

307,079

282,816

Total equity attributable to equity holders of the parent

458,602

451,099

Non-controlling interests

92,704

98,768

Total equity

551,306

549,867

Liabilities

Non-current

Interest-bearing loans and borrowings

250,416

250,572

Lease liabilities

106,188

99,770

Other payables

2,468

2,904

Contingent consideration and other provisions

5,401

7,957

Put option liability

13,443

23,083

Corporation tax payable

6,179

6,541

Deferred tax liabilities

31,601

27,731

Employee benefits

23,966

16,736

Total non-current liabilities

439,662

435,294

Current

Interest-bearing loans and borrowings

24,740

86,150

Lease liabilities

19,207

20,306

Trade and other payables

511,261

475,202

Contingent consideration and other provisions

5,109

8,534

Put option liability

10,829

3,529

Derivative financial instruments

937

305

Corporation tax payable

2,111

2,164

Total current liabilities

574,194

596,190

Total liabilities

1,013,856

1,031,484

Total liabilities and equity

1,565,162

1,581,351

Group Statement of Changes in Equity

for the year ended 31 December 2020 (unaudited)

Attributable to equity holders of the parent

Share

capital

€'000

Share

premium

€'000

Undenom-inated

capital

€'000

Own shares

reserve

€'000

Currency

translation

reserve

€'000

Reval-uation

reserve

€'000

Other equity

reserves*

€'000

Retained

earnings

€'000

Total

€'000

Non-controlling

interests

€'000

Total

equity

€'000

Balance at 1 January 2020 as presented in the Balance Sheet

4,105

295,487

140

(8,580)

(18,699)

30,809

(134,979)

282,816

451,099

98,768

549,867

Adjust for NCI subject to put option transferred for presentation purposes

-

-

-

-

-

-

(16,038)

-

(16,038)

16,038

-

As at 1 January 2020

4,105

295,487

140

(8,580)

(18,699)

30,809

(151,017)

282,816

435,061

114,806

549,867

Comprehensive income

Profit for the year

-

-

-

-

-

-

-

40,412

40,412

16,372

56,784

Other comprehensive income:

Items that may be reclassified subsequently to profit or loss:

Foreign currency translation effects, net

-

-

-

-

(21,652)

-

446

-

(21,206)

(5,755)

(26,961)

Effective portion of cashflow hedges, net of recycling

-

-

-

-

-

-

(325)

-

(325)

(140)

(465)

Changes in fair value of cost of hedging, net of recycling

-

-

-

-

-

-

(68)

-

(68)

(23)

(91)

Deferred tax on items above

-

-

-

-

-

-

84

-

84

46

130

Share of joint ventures and associates effective portion of cashflow hedges

-

-

-

-

-

-

(1,723)

-

(1,723)

-

(1,723)

Share of joint ventures and associates deferred tax on cashflow hedges

-

-

-

-

-

-

440

-

440

-

440

Items that will not be reclassified subsequently to profit or loss:

Revaluation gain on property, plant and equipment, net

-

-

-

-

-

11,222

-

-

11,222

218

11,440

Remeasurement loss on employee benefit schemes

-

-

-

-

-

-

-

(8,692)

(8,692)

(311)

(9,003)

Deferred tax on items above

-

-

-

-

-

(2,025)

-

1,892

(133)

39

(94)

Share of joint ventures remeasurement gain on employee pension schemes

-

-

-

-

-

-

-

429

429

-

429

Share of joint ventures revaluation gains on property, plant and equipment

-

-

-

-

-

1,176

-

-

1,176

-

1,176

Share of joint ventures deferred tax on items above

-

-

-

-

-

-

-

(110)

(110)

-

(110)

Total other comprehensive income

-

-

-

-

(21,652)

10,373

(1,146)

(6,481)

(18,906)

(5,926)

(24,832)

Total comprehensive income

-

-

-

-

(21,652)

10,373

(1,146)

33,931

21,506

10,446

31,952

Transactions with equity holders of the parent

New shares issued

2

132

-

-

-

-

(41)

41

134

-

134

Non-controlling interest arising on acquisition of subsidiaries

-

-

-

-

-

-

-

-

-

1,928

1,928

Put option liability exercised

-

-

-

-

-

-

3,568

332

3,900

(3,900)

-

Fair value movement on put option liability

-

-

-

-

-

-

(1,228)

-

(1,228)

-

(1,228)

Acquisition of non-controlling interests

-

-

-

-

-

-

-

(74)

(74)

(922)

(996)

Disposal of shareholding to non-controlling interest

-

-

-

-

-

-

-

45

45

240

285

Dividends paid

-

-

-

-

-

-

-

(10,012)

(10,012)

(20,510)

(30,522)

Share-based payment transactions

-

-

-

-

-

-

(114)

-

(114)

-

(114)

Total transactions with equity holders of the parent

2

132

-

-

-

-

2,185

(9,668)

(7,349)

(23,164)

(30,513)

As at 31 December 2020

4,107

295,619

140

(8,580)

(40,351)

41,182

(149,978)

307,079

449,218

102,088

551,306

Transfer of NCI subject to put option for presentation purposes

-

-

-

-

-

-

9,384

-

9,384

(9,384)

-

Balance at 31 December 2020 as presented in the Balance Sheet

4,107

295,619

140

(8,580)

(40,351)

41,182

(140,594)

307,079

458,602

92,704

551,306

1Other equity reserves comprise the demerger reserve, share option reserve, cashflow hedge reserve, cost of hedging reserve and the put option reserve.

Group Statement of Changes in Equity

for the year ended 31 December 2019

Attributable to equity holders of the parent

Share capital

Share premium

Undenomi-nated capital

Own share reserve

Currency translation reserve

Revaluation reserve

Other equity reserves1

Retained earnings

Total

Non-controlling interests

Total equity

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

€'000

Balance at 1 January 2019 as presented in the Balance Sheet

4,104

295,421

140

(8,580)

(22,721)

28,336

(120,232)

256,654

433,122

82,483

515,605

Adjust for impact of transition to IFRS 16, net of tax

-

-

-

-

159

-

-

(6,937)

(6,778)

(1,337)

(8,115)

Balance at 1 January 2019

4,104

295,421

140

(8,580)

(22,562)

28,336

(120,232)

249,717

426,344

81,146

507,490

Adjust for transfer of NCI subject to put option for presentation purposes

-

-

-

-

-

-

(34,673)

-

(34,673)

34,673

-

As at 1 January 2019

4,104

295,421

140

(8,580)

(22,562)

28,336

(154,905)

249,717

391,671

115,819

507,490

Comprehensive income

Profit for the year

-

-

-

-

-

-

-

53,302

53,302

12,902

66,204

Other comprehensive income

Items that may be reclassified subsequently to profit or loss:

Foreign currency translation effects, net

-

-

-

-

3,863

-

33

-

3,896

1,645

5,541

Effective portion of cashflow hedges, net of recycling

-

-

-

-

-

-

(148)

-

(148)

(1)

(149)

Changes in fair value of cost of hedging, net of recycling

-

-

-

-

-

-

155

-

155

(18)

137

Deferred tax on items above

-

-

-

-

-

-

-

-

-

(9)

(9)

Share of joint ventures and associates effective portion of cashflow hedges

-

-

-

-

-

-

(5,101)

-

(5,101)

-

(5,101)

Share of joint ventures and associates deferred tax on cashflow hedges

-

-

-

-

-

-

497

-

497

-

497

Items that will not be reclassified subsequently to profit or loss:

Revaluation gain on property, plant and equipment, net

-

-

-

-

-

1,624

-

-

1,624

471

2,095

Remeasurement loss on employee benefit schemes

-

-

-

-

-

-

-

(2,955)

(2,955)

(54)

(3,009)

Deferred tax on items above

-

-

-

-

-

(520)

-

(26)

(546)

(420)

(966)

Share of joint ventures remeasurement loss on employee pension schemes

-

-

-

-

-

-

-

(2,601)

(2,601)

-

(2,601)

Share of joint ventures revaluation gains on property, plant and equipment

-

-

-

-

-

1,369

-

-

1,369

-

1,369

Share of joint ventures deferred tax on items above

-

-

-

-

-

-

-

(75)

(75)

-

(75)

Total other comprehensive income

-

-

-

-

3,863

2,473

(4,564)

(5,657)

(3,885)

1,614

(2,271)

Total comprehensive income

-

-

-

-

3,863

2,473

(4,564)

47,645

49,417

14,516

63,933

Transactions with equity holders of the parent

New shares issued

1

66

-

-

-

-

(20)

20

67

-

67

Non-controlling interest arising on acquisition of subsidiaries

-

-

-

-

-

-

-

-

-

959

959

Put option liability extinguished

-

-

-

-

-

-

11,657

-

11,657

-

11,657

Fair value movement on put option liability

-

-

-

-

-

-

(3,294)

-

(3,294)

-

(3,294)

Acquisition of non-controlling interests

-

-

-

-

-

-

-

(1,102)

(1,102)

(554)

(1,656)

Acquisition of non-controlling interests by a joint venture

-

-

-

-

-

-

-

(151)

(151)

-

(151)

Disposal of subsidiary

-

-

-

-

-

-

-

-

-

121

121

Dividends paid

-

-

-

-

-

-

-

(13,313)

(13,313)

(16,055)

(29,368)

Share-based payment transactions

-

-

-

-

-

-

109

-

109

-

109

Total transactions with equity holders of the parent

1

66

-

-

-

-

8,452

(14,546)

(6,027)

(15,529)

(21,556)

As at 31 December 2019

4,105

295,487

140

(8,580)

(18,699)

30,809

(151,017)

282,816

435,061

114,806

549,867

Transfer of NCI subject to put option for presentation purposes

-

-

-

-

-

-

16,038

-

16,038

(16,038)

-

Balance at 31 December 2019 as presented in the Balance Sheet

4,105

295,487

140

(8,580)

(18,699)

30,809

(134,979)

282,816

451,099

98,768

549,867

1Other equity reserves comprise the demerger reserve, share option reserve, cashflow hedge reserve, cost of hedging reserve and the put option reserve

Group Statement of Cash flows

for the year ended 31 December 2020

.

Unaudited

2020

€'000

2019

€'000

Net cashflows from operating activities before working capital movements

84,680

67,249

Movements in working capital

52,092

6,527

Net cashflows from operating activities

136,772

73,776

Investing activities

Acquisition of subsidiaries

(1,265)

(6,683)

Cash assumed on acquisition of subsidiaries, net

1,527

2,308

Acquisition of, and investment in joint ventures and associates (including acquisition fees and net of loans advanced / repaid)

472

(7,145)

Payments of contingent consideration

(6,789)

(11,103)

Acquisition of equity investments

-

(150)

Disposal of shareholding to non-controlling interest

285

-

Proceeds from disposal of investments for resale

2,727

1,043

Proceeds from disposal of joint ventures and associates

98

48

Cash/(bank overdraft) derecognised on disposal of subsidiaries

-

(191)

Acquisition of property, plant and equipment

(15,011)

(19,518)

Acquisition of intangible assets-computer software

(5,370)

(4,621)

Acquisition of non-controlling interests subject to put options

(3,568)

-

Development expenditure capitalised

(112)

(62)

Proceeds from disposal of property and plant and equipment - routine

783

678

Proceeds from exceptional items - from disposals of investments

1,105

9,307

Payment of deferred consideration

(249)

-

Dividends received from joint ventures and associates

11,337

10,652

Government grants received

-

106

Net cashflows from investing activities

(14,030)

(25,331)

Financing activities

Drawdown of borrowings

266,015

345,764

Repayment of borrowings

(317,162)

(333,211)

Lease payments

(23,497)

(17,902)

Proceeds from the issue of share capital, net

134

67

Acquisition of non-controlling interests

(796)

(1,656)

Dividends paid to non-controlling interests

(20,510)

(16,055)

Dividends paid to equity holders of the parent

(10,012)

(13,313)

Net cashflows from financing activities

(105,828)

(36,306)

Net increase in cash, cash equivalents and overdrafts

16,914

12,139

Cash, cash equivalents and bank overdrafts at start of year

106,027

92,739

Net foreign exchange difference

(1,245)

1,149

Cash, cash equivalents and bank overdrafts at 31 December

121,696

106,027

Group Reconciliation of Net Debt

Unaudited

2020

€'000

2019

€'000

Net increase in cash, cash equivalents and bank overdrafts

16,914

12,139

Drawdown of borrowings

(266,015)

(345,764)

Repayment of borrowings

317,162

333,211

Interest-bearing loans and borrowings arising on acquisition

(2,550)

-

Foreign exchange movement

11,389

(2,672)

Movement in net debt

76,900

(3,086)

Finance lease reclassified from net debt on adoption of IFRS 16

-

1,636

Net debt at 1 January

(221,193)

(219,743)

Net debt at 31 December

(144,293)

(221,193)

Net debt is a non-IFRS measure which comprises bank deposits, cash and cash equivalents and current and non-current borrowings. It excludes lease liabilities. The calculation is outlined on Note 12.

Notes to the Preliminary Results

for the year ended 31 December 2020

1. Basis of preparation

The financial information included in this preliminary results statement has been extracted from the Group's Financial Statements for the year ended 31 December 2020 and is prepared based on the accounting policies set out therein, which are consistent with those applied in the prior year. As permitted by European Union (EU) law and in accordance with AIM/ESM rules, the Group Financial Statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) and their interpretations issued by the International Accounting Standards Board (IASB) as adopted by the EU.

The financial information prepared in accordance with IFRSs as adopted by the EU included in this report does not include all the information and disclosures required in the full statutory financial statements. The Annual Report and Financial Statements will be approved by the Board of Directors and reported on by the Auditor in due course. Accordingly, the financial information is unaudited. The Group Financial Statements will be filed with the Company's annual return in the Companies Registration Office and circulated to shareholders in due course. The financial information for the year ended 31 December 2019 represents an abbreviated version of the Group's statutory financial statements on which an unqualified audit report was issued, and which has been filed with the Companies Registration Office.

The financial information is presented in Euro, rounded to the nearest thousand where applicable.

2. Translation of foreign currencies

The reporting currency of the Group is Euro. The rates used in the translation of results and balance sheets into Euro were as follows:

Average rate

Closing rate

Unaudited

2020

2019

% change

Unaudited

2020

2019

% change

Brazilian Real

6.3727

4.4996

(41.6%)

6.3735

4.5157

(41.1%)

Canadian Dollar

1.5361

1.4864

(3.3%)

1.5628

1.4599

(7.0%)

Czech Koruna

26.3071

25.6150

(2.7%)

26.2420

25.4080

(3.3%)

Danish Kroner

7.4510

7.4647

0.2%

7.4412

7.4717

0.4%

Indian Rupee

84.4220

78.7716

(7.2%)

89.5594

79.9301

(12.0%)

Polish Zloty

4.4433

4.2969

(3.4%)

4.5706

4.2551

(7.4%)

Sterling

0.8942

0.8743

(2.3%)

0.8985

0.8506

(5.6%)

Swedish Krona

10.4877

10.5858

0.9%

10.0557

10.4778

4.0%

US Dollar1

1.1384

1.1173

(1.9%)

1.2265

1.1216

(9.4%)

1For the year ended 31 December 2020 the average rate used in translating the revenues of Dole to Euro was 1.1405 (31 December 2019: 1.1282) and equity accounted profit after tax of Dole to Euro was 1.1239 (2019: 1.1282).

3. Revenue

Unaudited

2020

€'000

Restated2 2019

€'000

Group Revenue

3,817,585

3,729,346

Plus:

Share of revenue of joint ventures - Dole

1,843,402

1,801,299

Share of revenue of joint ventures - Other

628,228

632,934

Share of revenue of associates

65,140

75,687

Total share of revenue of joint ventures and associates

2,536,770

2,509,920

Less:

Elimination of proportionate share of transactions between Group subsidiaries and joint ventures and associates 1

(94,857)

(86,172)

Total Revenue

6,259,498

6,153,094

1For calculation of Total Revenue which includes Group's share of joint ventures and associates, the Group eliminates the proportionate share of revenue transactions between Group subsidiaries and joint ventures and associates.

2 The Group's Total Revenue (which is a non-statutory number including the Group's share of joint venture and associate revenue) was restated. This is due to a misstatement in the prior year financial statements of the Group's joint venture, Dole. Dole has restated its previously issued financial statements for year ended 28 December 2019 to correct a misstatement in its income statement related to revenue. The correction resulted in a $50,395,000 decrease to revenue and costs of goods sold, with no impact to gross profit. Total Produces 45% share of this joint venture revenue was $22,678,000 (€20,101,000). The Group reflects Total Revenue as a key metric in its segmental analysis, therefore Total Revenue in the 2019 comparative above, and as presented in Note 4 Segmental Analysis, has been reduced by €20,101,000 from €6,173,195,000 to €6,153,094,000. There was no impact on gross profit or profit after tax from this error. This does not result in a restatement of the prior year Income Statement of Total Produce.

4. Segmental Analysis

IFRS 8 Operating Segments('IFRS 8') sets out the requirements for disclosure of financial and descriptive information about the operating segments, products and the geographical areas in which the Group operates, as well as information on major customers.

In accordance with IFRS 8, the Group's reportable operating segments, based on how performance is assessed and resources are allocated, are as follows:

· Europe - Non-Eurozone:This operating segment is an aggregation of six operating segments in the Czech Republic, Poland, Scandinavia and the United Kingdom.These segments have been aggregated as they all are primarily involved in the procurement, marketing and distribution of fresh produce and share other similar economic characteristics in terms of sourcing and distribution arrangements, net margins earned and operate in similar regulatory environments.

· Europe - Eurozone:This reportable segment is an aggregation of thirteen operating segments principally in France, Ireland, Italy, the Netherlands and Spain. These segments have been aggregated as they all are primarily involved in the procurement, marketing and distribution of fresh produce and some health foods and consumer goods products and share other similar economic characteristics in terms of sourcing and distributions arrangements, net margins earned, transact in Euro and operate in the same regulatory environment.

· International:This segment is an aggregation of five operating segments in North America, one in South America and one in India. These segments have been aggregated as they all are primarily involved in the procurement, marketing and distribution of fresh produce and share other similar economic characteristics in terms of sourcing and distribution arrangements, net margins earned and operate in similar regulatory environments. They also primarily transact in US Dollar.

· Dole:This operating segment represents the Group's 45% interest in Dole. Dole is one of the world's leading producers, marketers and distributors of fresh fruit and vegetables. It has an iconic brand and leading market positions and scale. It is one of the world's largest producers of bananas and pineapples and a leader in other fresh fruits, value added and fresh-packed vegetables and berries. In terms of market share they hold the number one and three positions respectively for bananas in North America and Europe and are number two and three respectively for pineapples in North America and Europe. They sell and distribute throughout a wide network in North America, Europe, Latin America, the Middle East and Africa.

Segment performance is evaluated based on revenue and adjusted EBITA. Management believes that adjusted EBITA, while not a defined term under IFRS, gives a fair reflection of the underlying trading performance of the Group. Adjusted EBITA represents earnings before interest, tax, acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items. It also excludes the Group's share of these items within joint ventures and associates. Adjusted EBITA is therefore measured differently from operating profit in the Group financial statements as explained and reconciled in full detail in the analysis that follows.

Finance costs, finance income and income taxes are managed on a centralised basis. These items are not allocated between operating segments for the purposes of the information presented to the Chief Operating Decision-Maker ('CODM') and are accordingly omitted from the detailed segmental analysis that follows.

Unaudited 2020

2019 (Restated)1,2

€'000

Segmental

Revenue

€'000

Third Party

Revenue

€'000

Adjusted

EBITA

€'000

Segmental

Revenue

€'000

Third Party

Revenue

€'000

Adjusted

EBITA

Europe - Non-Eurozone1

1,499,299

1,474,661

39,390

1,481,657

1,454,172

41,913

Europe - Eurozone1

1,687,370

1,666,755

28,708

1,661,446

1,637,185

20,477

International

1,295,949

1,295,734

26,012

1,271,566

1,271,566

22,284

Dole

1,843,402

1,822,348

70,128

1,801,299

1,790,171

65,440

Inter-segment revenue

(66,522)

--

-

(62,874)

-

-

Total Group

6,259,498

6,259,498

164,238

6,153,094

6,153,094

150,114

All inter-segment revenue transactions are at arm's length.

1 In 2020 there was a realignment in the reporting of small businesses in Europe due to change in divisional management responsibility. The comparative 2019 financial information for both European divisions have been restated to conform with the current presentation.

2 As described in detail in Note 3, the Group's 45% share of the 2019 revenue of Dole was restated. There was no impact on adjusted EBITA or profit after tax resulting from this misstatement.

Reconciliation of segmental profit to operating profit

Below is a reconciliation of adjusted EBITA per the Group's management reports to operating profit and profit before tax as presented in the Group income statement.

Unaudited

2020

€'000

2019

€'000

Adjusted EBITA per management reporting

164,238

150,114

Acquisition related intangible asset amortisation for subsidiaries

(i)

(10,144)

(10,301)

Share of joint ventures and associates acquisition related intangible asset amortisation

(i)

(2,543)

(2,696)

Fair value movements on contingent consideration

(ii)

(456)

204

Acquisition related costs within subsidiaries

(iii)

(348)

(177)

Share of joint ventures and associates net financial expense

(iv)

(38,312)

(40,817)

Share of joint ventures and associates tax (before tax on exceptional items)

(iv)

(19,043)

(14,059)

Operating profit before exceptional items

93,392

82,268

Net financial expense before exceptional items

(v)

(9,924)

(10,967)

Profit before tax before exceptional items

83,468

71,301

Exceptional items (Note 5)

(vi)

(9,970)

5,232

Profit before tax

73,498

76,533

I. Acquisition related intangible asset amortisation charges are not allocated to operating segments in the Group's management reports.

II. Fair value movements on contingent consideration are not allocated to operating segments in the Group's management reports.

III. Acquisition related costs are transaction costs directly related to acquisitions of subsidiaries completed and are not allocated to operating segments in the Group's management reports.

IV. Under IFRS, included within profit before tax is the Group's share of joint ventures' and associates' profit after acquisition related intangible asset amortisation charges, tax and interest. In the Group's management reports these items are excluded from the adjusted EBITA calculation.

V. Financial income and expense is primarily managed at Group level, and is therefore not allocated to operating segments in the Group's management reports.

VI. Exceptional items (Note 5) are not allocated to operating segments in the Group's management reports.

5. Exceptional items

Unaudited

2020

€'000

2019

€'000

Loss on disposal of investment (a)

-

(670)

Restructuring and associated credits/(costs) with disposal/termination of a business (b)

547

(1,146)

Share of joint ventures and associates exceptional items - Dole (c)

(10,607)

5,523

Impairment of goodwill (d)

(3,546)

-

Impairment of property, plant and equipment and investment property (e)

(1,063)

-

Total exceptional items (before share of joint ventures and associates' tax)

(14,669)

3,707

Share of joint ventures and associates' tax on exceptional items - Dole (c)

4,699

1,525

Exceptional items within profit before tax*

(9,970)

5,232

Net tax charge on exceptional items (f)

(916)

(47)

Total net of tax

(10,886)

5,185

Attributable as follows:

Equity holders of the parent

(10,861)

5,246

Non-controlling interests

(25)

(61)

(10,886)

5,185

*Of the €9,970,000 net exceptional cost in 2020, €4,062,000 has been recognised as net operating expense, and €5,908,000 net exceptional cost has been recognised within profits of joint ventures and associates.

(a) Loss on disposal of equity investment

In July 2018 a subsidiary of the Group disposed of an interest in a farming entity for consideration of shares in an equity investment which was to be realised over a period of two to three years and could vary depending on certain circumstances. The exceptional loss of €670,000 in 2019 represents the gain on the equity investments sold in the year less the fair value movement on the remaining equity investment and associated costs.

(b) Restructuring and associated credits/(costs) with disposal/termination of a business

In 2020, the Group recorded a net gain of €547,000 on the disposal of and termination of a business and on restructuring in the Non-Eurozone division. The net credit includes the reclassification of €793,000 of currency translation gains from the currency translation reserve to the income statement on the disposal of a business.

In 2019, the Group incurred losses of €572,000 on the disposal of and termination of two small businesses in the Non-Eurozone division. Restructuring charges of €574,000 were incurred in 2019 on ongoing restructuring programs in the Eurozone division.

(c) Share of joint ventures and associates exceptional items - Dole

The Group's share of the exceptional items in Dole in the year was a net charge of €10,607,000 with a related tax credit of €4,699,000. Included in these were net charges of €6,520,000 on mark-to-market of derivative financial instruments (including ineffectiveness on interest rate swap hedging instrument) and foreign currency gains/losses on long term foreign currency denominated intercompany borrowings, net restructuring charges of €1,430,000, and €4,355,000 due to COVID-19 costs (costs of employee protective equipment, double shifts etc). These charges were offset by net gains of €1,698,000 on asset sales/impairments.

The Group's share of the exceptional items in 2019 was a net gain of €5,523,000 with a related tax credit of €1,525,000. Included in these exceptional items are net gains of €11,904,000 on disposals of businesses/assets, net gains of €33,000 on mark to market of derivative financial instruments and foreign currency gains/losses on long term foreign currency denominated intercompany borrowings, net restructuring charges of €4,118,000, transaction costs of €626,000 and costs of €1,670,000 associated with industry wide product recalls.

(d) Impairment of goodwill

In 2020 the Group recognised a non-cash impairment charge of €3,546,000 in relation to a business in the Non-Eurozone division.

(e) Impairment of property, plant and equipment and investment property

All property is recognised in the financial statements at fair value. As part of the Group bi-annual review of carrying amount of property, the Group identified two properties in the Non-Eurozone division and one in the Eurozone division where fair value exceeded historic cost resulting in an exceptional income statement charge of €1,063,000.

(f) Tax charge on exceptional items

The tax effect on exceptional items within Group companies was a net charge of €916,000 (2019: €47,000).

Effect of COVID-19 in 2020

Within the Eurozone, Non-Eurozone and International divisions, there were additional operating costs relating to COVID-19 such as employee personal protective equipment and costs of additional shifts in warehouse to comply with physical distancing. These additional costs were offset by reductions in other costs such as travel expenses.

As noted in (c), the Group's 45% share of exceptional COVID-19 costs in Dole was €4,355,000 and related primarily to charges in its Fresh Vegetable division such as costs of double shifts, protective equipment and additional transport.

Effect of exceptional items on cashflow statement

The net effect of these items was a cash inflow of €757,000 (2019: €5,818,000), including cashflows relating to prior period exceptional items.

6. Earnings per share

Basic earnings per share

Basic earnings per share is calculated by dividing the profit for the period attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the period, excluding shares purchased by the Company which are held as treasury shares.

Unaudited

2020

€'000

2019

€'000

Profit for the financial year attributable to equity holders of the parent

40,412

53,302

'000

'000

Shares in issue at beginning of year

410,525

410,429

New shares issued from exercise of share options (weighted average)

35

51

Shares repurchased by company (weighted average)

-

(2)

Effect of treasury shares held

(22,000)

(22,000)

Weighted average number of shares

388,560

388,478

Basic earnings per share - cents

10.40

13.72

Diluted earnings per share

Diluted earnings per share is calculated by dividing the profit for the period attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding after adjustment for the effects of all ordinary shares and options with a dilutive effect.

Unaudited

2020

€'000

2019

€'000

Profit for the financial year attributable to equity holders of the parent

40,412

53,302

'000

'000

Weighted average number of shares

388,560

388,478

Effect of share options with a dilutive effect

583

817

Weighted average number of shares (diluted)

389,143

389,295

Diluted earnings per share -cent

10.38

13.69

The average market value of the Company's shares for the purpose of calculating the dilutive effect of share options was based on the quoted market prices for the period during which the options were outstanding.

Adjusted basic earnings per share and adjusted fully diluted earnings per share

Unaudited

2020

€'000

2019

€'000

Profit for the financial year attributable to ordinary equity holders of the parent

40,412

53,302

Adjustments:

Exceptional items - net of tax (Note 5)

10,886

(5,185)

Acquisition related intangible asset amortisation within subsidiaries

10,144

10,301

Share of joint ventures and associates acquisition related intangible asset amortisation

2,543

2,696

Acquisition related costs within subsidiaries

348

177

Fair value movements on contingent consideration

456

(204)

Tax effect of amortisation charges of goodwill, intangible assets and fair value movements on contingent consideration

(1,548)

(3,188)

Non-controlling interests share of the items above

(3,279)

(2,915)

Adjusted profit attributable to equity holders of the parent

59,962

54,984

'000

'000

Weighted average number of shares

388,560

388,478

Weighted average number of shares (diluted)

389,143

389,295

Adjusted basic earnings per share - cent

15.43

14.15

Adjusted fully diluted earnings per share - cent

15.41

14.12

Management believe that adjusted fully diluted earnings per share as set out above provides a fairer reflection of the underlying trading performance of the Group after eliminating the effect of acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items and the related tax on these items.

Adjusted basic earnings per share iscalculated by dividing the adjusted profit attributable to ordinary equity holders of the parent (as calculated above) by the weighted average number of ordinary shares outstanding during the period, excluding shares purchased by the Company which are held as treasury shares.

Adjusted fully diluted earnings per share iscalculated by dividing the adjusted profit attributable to ordinary equity holders of the parent (as calculated above) by the weighted average number of ordinary shares outstanding after adjustment for the effects of all ordinary shares and options with a dilutive effect.

7. Investment in Dole

Total Produce (or the 'Group') has one joint venture which is material to the Group and which is equity accounted, Dole Food Company Inc ('Dole'). The registered address of Dole is 200 S. Tyron St, Suite 600, Charlotte, NC 28211.

Summary of Initial Transaction that is in place at 31 December 2020

As disclosed previously, on 31 July 2018, Total Produce completed the First Tranche of a transaction to acquire a 45% shareholding in Dole from Castle & Cook Inc and affiliates (owned by Mr David H. Murdock) for $300m.

In addition, and at any time after 31 July 2018, the Group has the right, but not the obligation, to acquire (in any one or more tranches of 1%) up to an additional 6% of Dole common stock (the 'Second Tranche'). In the event the Group exercises the right to acquire the additional 6% the total consideration for the 51% stake shall be $312 million.

From and after 31 July 2020, the Group has the right, but not the obligation, to acquire the balance of Dole common stock (the 'Third Tranche'), whereby the consideration for the Third Tranche is to be calculated based on nine times the preceding historical three-year average Dole adjusted EBITDA less net debt. However, in no event shall the Third Tranche purchase price be less than $250m or exceed $450m (such cap subject to increase after six years). The Third Tranche consideration is payable in cash or, if the parties mutually agree, Total Produce stock.

Effective as of 31 July 2023, if the Group has not exercised its right to acquire 100% of Dole, Mr. David H. Murdock is permitted to cause a process to market and sell 100% of Dole common stock. This is subject to a sales proceeds refund mechanism designed to protect the value of Total Produce's initial investment plus a guaranteed return.

On completion of the acquisition of the First Tranche on 31 July 2018, the Group and Mr. David H. Murdock have balanced governance rights with respect to Dole. The Board of Directors of Dole comprises of six members, three of which are appointed by Total Produce and three by Mr. David H. Murdock. Mr. David H. Murdock remains Chairman of Dole and Carl McCann was appointed Vice Chairman. Major decisions require consent of at least one Board Member appointed by each of Total Produce and Mr. David H. Murdock.

As part of the provisions of acquisition accounting, a fair value was determined for the Second Tranche Option which is recognised as a current derivative financial asset in the Total Produce Group balance sheet and correspondingly reduces the deemed cost of the acquisition of the First Tranche. The fair value of the Third Tranche Option was not deemed material at the date of acquisition or at 31 December 2020.

As part of the Securities Purchase Agreement, the seller provided indemnities against certain liabilities outstanding at the date of acquisition. The fair value of these indemnities was recognised as a long-term asset in the Total Produce Group balance sheet with a corresponding reduction in the deemed cost of the acquisition

The investment in Dole and its financial contribution is being treated as a joint venture and accounted for under the equity method in accordance with IFRS in the consolidated Group accounts following completion of the acquisition of the First Tranche on 31 July 2018 and until an exercise of the Third Tranche. Total Produce is therefore equity accounting for its 45% share of the results of Dole with effect from 1 August 2018.

Summary of Announcement post year-end on 17 February 2021

On 17 February 2021, the Group and Dole Food Company Inc and affiliates of Castle & Cooke, Inc. (the 'C&C shareholders'), which own a 55% interest in Dole's parent company ('Dole Holdings') (together, the 'Parties'), announced that they have entered into a binding transaction agreement (the 'Agreement') to combine under a newly created, U.S. listed company ('Dole plc') (the 'Transaction').

The Transaction will simplify the existing structure between the two companies by unifying Dole and Total Produce under common ownership, with the objective of enabling full operational integration, realisation of synergies and value creation across the enlarged business.

Under the terms of the Agreement, Total Produce shareholders will receive 82.5% of Dole plc shares and the C&C shareholders will receive 17.5% of Dole plc shares, in each case based on the fully diluted outstanding shares immediately prior to the completion of the Transaction.

Per the Agreement, Dole plc's completion of an initial public offering and a listing on a major U.S. stock exchange is a condition for completion of the Transaction (the 'IPO'). In connection with the Transaction, Dole plc intends to target raising US$500 to US$700 million in primary equity capital to strengthen and de-lever the combined balance sheet. Upon completion of the U.S. listing of Dole plc, Total Produce will cease to be listed on Euronext Dublin and the London Stock Exchange.

The Transaction is subject to approval by Total Produce shareholders and other regulatory approvals.

Should the Transaction fail to complete for any reason the terms of the Initial Transaction (as described above) remain in place and Total Produce will continue to be listed on Euronext Dublin and the London Stock Exchange.

Summary of Financial Information for Dole for year ended 31 December 2020

Dole's 2020 financial year began on 29 December 2019 and ended on 31 December 2020. Dole's financial calendar for the 2019 financial year began on 30 December 2018 and ended on 28 December 2019.

The following is the summarised financial information of Dole for the financial year ended 31 December 2020 and the financial year ended 28 December 2019 based on consolidated financial statements prepared under IFRS, modified for fair value adjustments on acquisition and differences in the Group's accounting policies.

Restatement of comparative financial information

Dole restated its IFRS financial information at the date of acquisition on 31 July 2018 due to an overstatement of post-retirement benefit liabilities. Dole's operations in Latin America are obliged by social regulations to provide certain termination benefits to employees involuntarily terminated. Under US GAAP these potential benefits of $29,000,000 are recorded as post-retirement benefits. However, in the exercise to convert Dole financial information to IFRS, these termination benefits should not have been recorded as a liability in the IFRS acquisition balance sheet on 31 July 2018. The appropriate treatment under IFRS is to account for such benefits as period costs when incurred. The tax effect of this adjustment is an increase of $2,604,000 in net deferred tax liabilities. As Total Produce acquired its 45% interest in Dole on 31 July 2018, the Group amended the IFRS acquisition accounting for its equity investment in Dole effective 31 July 2018 to correct this misstatement by increasing its share of the net assets acquired of Dole by $11,878,000 (being 45% of $26,396,000) with a corresponding $11,878,000 decrease in goodwill. As the Group equity accounts for Dole, its 45% share of its net assets and the goodwill arising on acquisition are all part of the Group's carrying amount of Dole that is reflected as one number on the Group's Balance Sheet. Therefore, this does not result in a restatement of the prior year Income Statement or Balance Sheet of Total Produce.

Dole restated its previously issued US GAAP financial statements and IFRS financial information for the financial year ended 30 December 2017, to correct a misstatement made in the calculation of long-term tax provisions. The correction resulted in an $8,500,000 increase to other long-term liabilities and a $8,500,000 decrease in retained earnings in Dole's own financial statements for the financial years ended 29 December 2018 and 28 December 2019. As Total Produce acquired its 45% interest in Dole on 31 July 2018, the Group amended the acquisition accounting for its equity investment in Dole effective 31 July 2018 to correct this misstatement by reducing its share of the net assets acquired of Dole by $3,825,000 (being 45% of $8,500,000) with a corresponding $3,825,000 increase in goodwill. As the Group equity accounts for Dole, its 45% share of its net assets and the goodwill arising on acquisition are all part of the Group's carrying amount of Dole that is reflected as one number on the Group's Balance Sheet. Therefore, this does not result in a restatement of the prior year Income Statement or Balance Sheet of Total Produce.

Dole also restated its previously issued US GAAP financial statements and IFRS financial information for the financial year ended 28 December 2019 to correct a misstatement in its income statement related to revenue. The correction resulted in a $50,395,000 decrease to revenue and costs of goods sold, with no impact to gross profit. Total Produces 45% share of this joint venture revenue was $22,678,000 (€20,101,000). Total Produce includes the Group's share of joint ventures and associate revenue within its Total Revenue calculation, which is the key revenue metric in its segmental analysis. Therefore, Total Revenue in the 2019 comparative in Note 4 Segmental Analysis is reduced by €20,101,000 from €6,173,195,000 to €6,153,094,000. This does not result in a restatement of the prior year Income Statement of Total Produce.

.

Summary income statement Dole (in USD '000)

12 months ended 31 December 2020

Unaudited

12 months ended 28 December 2019 (Restated) 1

Pre-exceptional

US$'000

Exceptional Items

US$'000

Total

US$'000

Pre-exceptional

US$'000

Exceptional Items

US$'000

Total

US$'000

Revenue

4,671,999

-

4,671,999

4,515,959

-

4,515,959

Operating profit

184,554

(21,572)

162,982

173,790

13,846

187,636

Net financial expense

(70,326)

(4,921)

(75,247)

(78,369)

-

(78,369)

Leasing interest expense

(20,405)

-

(20,405)

(19,284)

-

(19,284)

Profit before tax

93,823

(26,493)

67,330

76,137

13,846

89,983

Income tax

(38,731)

11,737

(26,994)

(25,477)

3,823

(21,654)

Profit after tax

55,092

(14,756)

40,336

50,660

17,669

68,329

Non-controlling interests

(1,914)

-

(1,914)

(2,205)

-

(2,205)

Profit attributable to equity shareholders

53,178

(14,756)

38,422

48,455

17,669

66,124

Groups' 45% share of profit attributable to equity shareholders

23,930

(6,640)

17,290

21,805

7,951

29,756

1 Restatement of 2019 comparative revenue due to prior year misstatement as explained above.

Summary of other comprehensive income statement Dole (in USD '000)

Unaudited

2020

US$'000

2019

US$'000

Effective portion of cashflow hedges, net of recycling

(4,304)

(12,753)

Remeasurement gain/(loss) on employee benefit schemes

1,072

(6,459)

Revaluation gain on property, plant and equipment

2,938

3,411

Deferred tax on items above

823

1,048

Foreign currency translation effects

24,911

(8,015)

Other comprehensive income/(expense) for the period (net of tax)

25,440

(22,768)

Non-controlling interests share

-

-

Attributable to equity shareholders

25,440

(22,768)

Group's 45% share of other comprehensive income/(expense) attributable to equity shareholders

11,448

(10,246)

Summary income statement Dole (in Euro '000)

12 months ended 31 December 2020Unaudited

12 months ended 28 December 2019 (Restated)1

Pre-exceptional

€'000

Exceptional Items

€'000

Total

€'000

Pre-exceptional

€'000

Exceptional Items

€'000

Total

€'000

Revenue

4,096,448

-

4,096,448

4,002,887

-

4,002,887

Operating profit

164,209

(19,194)

145,015

154,044

12,274

166,318

Net financial expense

(62,573)

(4,378)

(66,951)

(69,465)

-

(69,465)

Leasing interest expense

(18,156)

-

(18,156)

(17,093)

-

(17,093)

Profit before tax

83,480

(23,572)

59,908

67,486

12,274

79,760

Income tax

(34,461)

10,443

(24,018)

(22,582)

3,388

(19,194)

Profit after tax

49,019

(13,129)

35,890

44,904

15,662

60,566

Non-controlling interests

(1,703)

-

(1,703)

(1,954)

-

(1,954)

Profit attributable to equity shareholders

47,316

(13,129)

34,187

42,950

15,662

58,612

Groups' 45% share of profit attributable to equity shareholders

21,292

(5,908)

15,384

19,327

7,048

26,375

1 Restatement of 2019 comparative revenue due to prior year misstatement as explained on page 24.

Summary of other comprehensive income statement Dole (in Euro '000)

Unaudited

2020

€'000

2019

€'000

Effective portion of cashflow hedges, net of recycling

(3,830)

(11,414)

Remeasurement gain/(loss) on employee benefit schemes

954

(5,781)

Revaluation gain on property, plant and equipment

2,614

3,041

Deferred tax on items above

732

938

Foreign currency translation effects

22,165

(7,173)

Other comprehensive income/(expense) for the period (net of tax)

22,635

(20,389)

Non-controlling interests share

-

-

Attributable to equity shareholders

22,635

(20,389)

Group's 45% share of other comprehensive income/(expense) attributable to equity shareholders

10,186

(9,175)

Key performance indicators Dole

Unaudited

2020

US$'000

2019

US$'000

Unaudited

2020

€'000

2019

€'000

Adjusted EBITDA (adding back depreciation of right of use assets)

326,764

307,724

290,741

272,762

Adjusted EBITDA

259,174

245,013

230,603

217,176

Adjusted EBITA

184,554

173,790

164,209

154,045

Summary Balance Sheet of Dole

Unaudited

2020

US$'000

(Restated) 20191

US$'000

Unaudited

2020

€'000

(Restated) 20191

€'000

Intangible assets - primarily brand

284,848

285,540

232,252

254,592

Property, plant and equipment

1,103,441

1,069,546

899,693

953,622

Right of use assets

249,539

279,068

203,462

248,821

Assets held for sale / Actively marketed property

49,131

64,760

40,059

57,741

Other non-current assets

118,428

107,753

96,561

96,074

Other current assets

868,976

862,588

708,521

769,096

Net debt

(1,209,727)

(1,287,328)

(986,353)

(1,147,800)

Employee benefit obligations

(137,942)

(146,059)

(112,472)

(130,228)

Lease liabilities

(268,306)

(294,034)

(218,764)

(262,165)

Other non-current liabilities

(246,522)

(249,740)

(201,002)

(222,672)

Other current liabilities

(673,018)

(617,365)

(548,747)

(550,452)

Non-controlling interests

(9,427)

(9,170)

(7,686)

(8,176)

Fair value of net assets attributable to equity shareholders

129,421

65,559

105,524

58,453

Total Produce's 45% share of net assets

58,239

29,501

47,485

26,304

Goodwill

267,634

267,634

218,259

238,589

Total carrying amount of 45% interest in Dole

325,873

297,135

265,744

264,893

1 Restatement of 2019 comparative balances for employee benefit obligations and other non-current liabilities as explained on pages 23 and 24.

Reconciliation of Group's carrying amount of investment in Dole

Unaudited

2020

US$'000

2019

US$'000

Unaudited

2020

€'000

2019

€'000

Opening carrying amount of 45% investment in Dole

297,135

281,432

264,893

245,881

Retained earnings adjustment on transition to IFRS 16

-

(3,807)

-

(3,326)

Group share of profit attributable to equity shareholders

17,290

29,756

15,384

26,375

Group share of other comprehensive income/(expense) attributable to equity shareholders

11,448

(10,246)

10,186

(9,175)

Foreign exchange movement

-

-

(24,719)

5,138

Closing carrying amount of 45% interest in Dole

325,873

297,135

265,744

264,893

8. Post-employment obligations

Unaudited

2020

2019

€'000

€'000

Employee defined benefit pension schemes obligations

(17,330)

(10,828)

Other post-employment defined benefit obligations

(6,636)

(5,908)

(23,966)

(16,736)

Employee defined benefit pension schemes

Unaudited

2020

2019

€'000

€'000

Pension assets

199,805

192,227

Pension obligations

(217,135)

(203,055)

Net liability

(17,330)

(10,828)

Net related deferred tax asset

3,052

1,479

Net liability after tax

(14,278)

(9,349)

Movement in year

Net liability at beginning of year

(10,828)

(10,941)

Net interest expense and current service cost recognised in the income statement

(2,093)

(1,677)

Employer contributions to schemes

3,357

4,866

Remeasurement loss recognised in other comprehensive income

(8,122)

(2,683)

Translation adjustment

356

(393)

Net liability at end of year before deferred tax

(17,330)

(10,828)

The table above summarises the movements in the net liability of the Group's various defined benefit pension schemes in Ireland, the UK, Continental Europe and North America in accordance with IAS 19 Employee Benefits (2011).

The Group's balance sheet at 31 December 2020 reflects net pension liabilities of €17.3m in respect of schemes in deficit, resulting in a net deficit of €14.3m after deferred tax. The increase in the net liability was due to a decrease in the Eurozone and UK discount rates which increases the net present value of scheme obligations. This was offset by an average return of 7.5% on pension scheme assets in 2020.

The below table shows the discount rates and inflation rates:

Unaudited

2020

2019

Eurozone

Discount rates

1.08%

1.40%

Inflation rates

1.30%

1.40%

UK

Discount rates

1.40%

2.00%

Inflation rates

2.90%

2.70%

9. Dividends

The 2019 final dividend of 2.5770 was paid on 2 September 2020. The payment of the 2020 interim dividend of 0.9129 cent per share (which was unchanged on prior year) was paid post year-end on 29 January 2021.

The Group intends to pay a final dividend of 2.770 cent per share representing a 7.5% increase on 2019, in May 2021. The total dividend for 2020 will amount to 3.6829 cent per share (2019: 3.4899) and represents an increase of 5.5% on 2019. The total dividend represents a pay-out of almost 24% of the adjusted earnings per share.

In accordance with company law and IFRS, these dividends have not been provided for in the balance sheet at 31 December 2020.

During the year dividends of €20,510,000 (2019: €16,055,000) were paid to non-controlling interests within certain of the Group's subsidiaries.

10. Businesses acquired and other developments

Summary of investments in 2020

A key part of the Group's strategy is growth by acquisition. In line with this strategy the Group made a number of acquisitions in 2020 with initial cash spend of €1,265,000 (2019: €6,683,000), deferred consideration of €Nil (2019: €114,000) with a further €122,000 (2019: €1,461,000) of contingent consideration payable dependent on the achievement of profit targets. The acquisitions in 2020 included the acquisition of additional shares in Eco Farms, a company based in California in the United States that specialises in avocados. This resulted in Eco Farms being consolidated as a subsidiary of the Group. The initial 45% interest was treated as a joint venture up to April 2020.

Summary of fair values of assets and liabilities acquired

The table below provides details on the total fair value of acquisitions of subsidiaries in 2020. None of the business combinations completed during the year were considered sufficiently material to warrant separate disclosure of the fair values attributable to those combinations.

Unaudited

2020

Total

€'000

2019

Total

€'000

Consideration paid and payable

Cash consideration

1,265

6,683

Contingent consideration

122

1,461

Deferred consideration

-

114

Total fair value of consideration

1,387

8,258

Identifiable assets acquired and liabilities assumed

Property, plant and equipment

6,398

1,054

Right of use assets

493

3,564

Biological assets

262

-

Intangible assets - Customer relationships

52

2,392

Intangible assets - Software

55

434

Intangible assets - Supplier relationships, brand and other

-

189

Inventories

989

590

Trade and other receivables

7,183

9,859

Cash, and cash equivalents

1,527

2,308

Interest-bearing loans and borrowings

(2,550)

-

Lease liabilities

(501)

(3,553)

Corporation tax

(12)

58

Trade and other payables

(6,837)

(10,921)

Deferred tax asset

82

74

Deferred tax liability

-

(398)

Fair value of net identifiable assets and liabilities acquired

7,141

5,650

Non-controlling interests arising on acquisition

Non-controlling interests measured at share of net assets

1,928

959

Total value of non-controlling interests arising on acquisition

1,928

959

Goodwill calculation

Fair value of consideration

1,387

8,258

Fair value of pre-existing interest in acquiree

4,680

-

Fair value of net identifiable assets and liabilities acquired

(7,141)

(5,650)

Non-controlling interest arising on acquisition

1,928

959

Goodwill arising

854

3,567

Cashflows relating to acquisition of subsidiaries

Unaudited

2020

€'000

2019

€'000

Cash consideration for acquisition of subsidiary undertakings

(1,265)

(6,683)

Cash, cash equivalents and bank overdrafts acquired

1,527

2,308

Cash inflow/(outflow) per cashflow statement

262

(4,375)

Cash consideration paid

The cash spend on acquisitions in 2020 was €1,265,000 (2019: €6,683,000). Net of cash, cash equivalents and bank overdrafts acquired the net cash inflow was €262,000 (2019: outflow €4,375,000).

Contingent consideration

The Group has agreed to pay vendors additional consideration of €122,000 (2019: €1,633,000) in future periods which is payable on achievement of certain profit criteria. The fair value of this contingent consideration at the date of acquisition of €122,000 (2019: €1,461,000) was calculated by using the expected present value technique.

Fair value of identifiable assets and liabilities assumed

The acquisition method of accounting has been used to consolidate businesses acquired. Other than liabilities for contingent consideration, no contingent liabilities have been recognised on the business combinations in either year. Should any fair values need to be adjusted they will be reflected in the acquisition accounting within one year of the acquisition date in line with the provisions of IFRS 3 Business Combinations.

Goodwill arising

The principal factor contributing to the recognition of goodwill of €854,000 (2019: €3,567,000) is the value and skills of the assembled workforce in the acquired entities along with anticipated costs savings and synergies arising from integration into the Group's existing businesses.

Acquisition related costs

The Group incurred acquisition related costs of €348,000 (2019: €177,000) on legal and professional fees and due diligence in respect of the completed acquisitions. These costs have been included within other operating expenses.

Effect of acquisitions on income statement in the year

The acquisitions of subsidiaries in 2020 contributed €32,879,000 to total revenue and €1,874,000 to Group operating profit in the year. These numbers exclude the contributions from any joint venture and associate investments completed in the year.

If the acquisition date for these business combinations was 1 January 2020, the estimated total revenue for the year ended 31 December 2020 would have been €6,268,175,000 and estimated operating profit after exceptional items would have been €83,600,000. These numbers exclude the contributions from any joint ventures and associates completed in the year.

11. Cashflows generated from operations

Unaudited

2020

€'000

2019

€'000

Operating activities

Profit for the year

56,784

66,204

Non-cash adjustments to reconcile profit to net cashflows:

Income tax expense

16,714

10,329

Income tax paid

(16,965)

(15,154)

Depreciation of property, plant and equipment

17,976

17,773

Depreciation of right of use assets

22,397

19,253

Exceptional items - impairment of property, plant and equipment and investment property

1,063

-

Exceptional items - goodwill impairment

3,546

-

Exceptional items - other operating expenses

(547)

1,816

Exceptional cashflows

(348)

(3,489)

Fair value movements on contingent consideration

456

(204)

Amortisation of intangible assets - acquisition related

10,144

10,301

Amortisation of intangible assets - development costs capitalised

170

238

Amortisation of intangible assets - computer software

2,616

2,046

Amortisation of government grants

(66)

(63)

Defined benefit pension scheme expense - normal

2,093

1,677

Contributions to defined benefit pension schemes - normal

(3,357)

(4,866)

Other post-employment benefit scheme expense

451

451

Net payments for other employee benefit scheme

(196)

(249)

Share-based payment (credit)/expense

(114)

109

Net gain on disposal of property, plant and equipment

(264)

(313)

Movement in provisions

504

(489)

Fair value gain on other investments

(245)

(854)

Financial income

(2,287)

(2,754)

Financial expense

12,211

13,721

Financial income received

2,289

2,005

Financial expense paid

(12,505)

(13,149)

Loss/(gain) on non-hedging derivative financial instruments

213

(115)

Loss on termination of right of use leased assets

4

146

Gain on disposal of joint venture

-

(88)

Fair value movement on joint venture becoming a subsidiary

80

-

Fair value movements on biological assets

252

666

Share of profit of joint ventures

(27,435)

(37,033)

Share of profit of associates

(954)

(666)

Net cashflows from operating activities before working capital movements

84,680

67,249

Movements in working capital:

Movements in inventories

(16,592)

(6,091)

Movements in biological assets

757

530

Movements in receivables

28,615

27,342

Movements in payables

39,312

(15,254)

Total movements in working capital

52,092

6,527

Net cashflows from operating activities

136,772

73,776

12. Analysis of Net Debt and Cash and Cash Equivalents

Net debt is a non-IFRS measure which comprises cash and cash equivalents and current and non-current borrowings. The calculation of net debt at 31 December 2020 is as follows:

Unaudited

2020

€'000

2019

€'000

Current assets

Bank balances

130,807

99,445

Call deposits (demand balances)

56

16,084

Current liabilities

Bank overdrafts

(9,167)

(9,502)

Current bank borrowings

(15,573)

(76,648)

Non-current liabilities

Non-current bank borrowings

(250,416)

(250,572)

Net debt at end of year

(144,293)

(221,193)

Reconciliation of cash and cash equivalents per balance sheet to cashflow statement

Unaudited

2020

€'000

2019

€'000

Cash and cash equivalents per balance sheet

130,863

115,529

Bank overdrafts

(9,167)

(9,502)

Cash, cash equivalents and bank overdrafts per cashflow statement

121,696

106,027

13. Post balance sheet events

The payment of the 2020 interim dividend of 0.9129 cent per share was paid post year-end on 29 January 2021. The total dividend amounted to €3,549,000.

On 17 February 2021, the Group and Dole Food Company Inc and affiliates of Castle & Cooke, Inc. (the 'C&C shareholders'), which own a 55% interest in Dole's parent company ('Dole Holdings') (together, the 'Parties'), announced that they entered into a binding transaction agreement (the 'Agreement') to combine under a newly created, U.S. listed company ('Dole plc') (the 'Transaction').

The Transaction will simplify the existing structure between the two companies by unifying Dole and Total Produce under common ownership, with the objective of enabling full operational integration, realisation of synergies and value creation across the enlarged business.

Under the terms of the Agreement, Total Produce shareholders will receive 82.5% of Dole plc shares and the C&C shareholders will receive 17.5% of Dole plc shares, in each case based on the fully diluted outstanding shares immediately prior to the completion of the Transaction.

Per the Agreement, Dole plc's completion of an initial public offering and a listing on a major U.S. stock exchange is a condition for completion of the Transaction (the 'IPO'). In connection with the Transaction, Dole plc intends to target raising US$500 to US$700 million in primary equity capital to strengthen and de-lever the combined balance sheet. Upon completion of the U.S. listing of Dole plc, Total Produce will cease to be listed on the Euronext Dublin and the London Stock Exchange.

Total Produce has secured fully committed debt facilities to backstop and refinance all existing Total Produce and Dole debt facilities upon completion of the Transaction, with the exception of the Dole vessel financing and certain other bilateral facilities which will remain post completion. Overall, this is expected to provide for a stronger balance sheet with a well-termed out capital structure, which is expected to enhance Dole plc's credit profile and lower its average cost of capital going forward.

Dole plc, operating under the Dole brand, will be incorporated in Ireland, with its Global Headquarters in Dublin, Ireland. Its headquarters for the Americas will be in Charlotte, North Carolina.

The highly regarded management teams of Total Produce and Dole, with combined experience of over 150 years in the fresh produce sector, will continue to operate the combined business.

The Transaction is subject to approval by Total Produce shareholders and other regulatory approvals.

Should the Transaction fail to complete for any reason the terms of the Initial Dole Transaction remain in place and Total Produce will continue to be listed on Euronext Dublin and the London Stock Exchange.

The full terms of the Transaction are outlined in the Stock Exchange announcement on 17 February 2021.

The Group has secured a committed debt facility with a term of 5 years to backstop and refinance certain existing Total Produce facilities in advance of the completion of the Transaction. In the event that the Transaction does not complete this committed financing shall remain in place in the Total Produce Group.

14. Related party transactions

There have been no related party transactions or changes to related party transactions other than those described in the 2019 Annual Report that materially affect the financial position or the performance of the Group for the year ended 31 December 2020.

15. Board approval

This announcement was approved by the Board of Directors of Total Produce plc on 24 February 2021

Appendix

Alternative Performance Measures (APMs)

The Group uses a number of alternative performance measures ('APMs') that are not required under International Financial Reporting Standards ('IFRS') which represent the generally accepted accounting principles ('GAAP') under which the Group reports. These measures are referred to throughout the discussion of our reported operating performance and financial position and are measures which are regularly reviewed by Group management. The Group believes that the presentation of these APMs provide useful supplementary information which, when viewed with the IFRS financial information provides investors with a more meaningful understanding of the underlying financial and operating performance of the Group.

These APMs may not be uniformly defined by all companies and accordingly they may not be directly comparable with similarly titled measures and disclosures by other companies. These APMs should not be viewed in isolation or as an alternative to the equivalent GAAP measures.

The principal APMs used by the Group, together with the reconciliation where the non-GAAP measures are not readily identifiable from the financial statements are as follows:

Total revenue

Definition

Total revenue includes the Group's share of the revenue of its joint ventures and associates. The calculation is presented in Note 3 of the accompanying financial information.

Adjusted EBITDA

Definition

Earnings before interest, tax, depreciation of property, plant and equipment, acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items. It also excludes the Group's share of these items within joint ventures and associates. The calculation is presented in the table on page 34.

Adjusted EBITDA (after add back of right of use asset depreciation)

Definition

Earnings before interest, tax, depreciation of property, plant and equipment, depreciation of right of use assets, acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items. It also excludes the Group's share of these items within joint ventures and associates. The calculation is presented in the table on page 34.

Adjusted EBITA

Definition

Earnings before interest, tax, acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items. It also excludes the Group's share of these items within joint ventures and associates. The calculation is presented in the table on page 34.

Adjusted profit before tax

Definition

Excludes acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings and exceptional items. It also excludes the Group's share of these items within joint ventures and associates. The calculation is presented in the table on page 34.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Profit before tax per income statement

Income Statement

73,498

76,533

Adjustments:

Exceptional items

Note 5

9,970

(5,232)

Fair value movements on contingent consideration

456

(204)

Share of joint ventures and associates' tax (before tax on exceptional items)

19,043

14,059

Acquisition related intangible asset amortisation within subsidiaries

10,144

10,301

Share of joint ventures and associates acquisition related intangible asset amortisation

2,543

2,696

Acquisition related costs within subsidiaries

Income Statement

348

177

Adjusted profit before tax

116,002

98,330

Exclude:

Net financial expense - subsidiaries

Income Statement

9,924

10,967

Net financial expense - share of joint ventures and associates

38,312

40,817

Adjusted EBITA

164,238

150,114

Exclude:

Amortisation of software costs

2,616

2,046

Depreciation of property, plant and equipment - subsidiaries

17,976

17,773

Depreciation of property, plant and equipment - share of joint ventures and associates

34,592

32,870

Adjusted EBITDA

219,422

202,803

Exclude:

Depreciation of right of use assets - subsidiaries

22,397

19,253

Depreciation of right of use assets - share of joint ventures and associates

31,745

29,115

Adjusted EBITDA (before depreciation of right of use assets)

273,564

251,171

Adjusted fully diluted earnings per share

Definition

Excludes acquisition related intangible asset amortisation charges and costs, fair value movements on contingent consideration, unrealised gains or losses on derivative financial instruments, gains and losses on foreign currency denominated intercompany borrowings, exceptional items and related tax on such items. It also excludes the Group's share of these items within joint ventures and associates. The calculation is outlined in Note 6.

Effective tax rate calculation

Definition

The Group's effective tax rate expresses the Group's income tax expense (including the share of joint ventures and associates) before tax impact of exceptional items and goodwill and intangible asset amortisation as a percentage of the Group's adjusted profit before tax.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Income tax expense

Income Statement

16,714

10,329

Group share of tax charge of joint ventures and associates

14,344

12,534

Total tax charge

31,058

22,863

Adjustments:

Deferred tax credit on amortisation of intangible assets - subsidiaries

1,217

2,623

Deferred tax credit on amortisation of intangible assets - share of joint ventures and associates

331

565

Tax charge on exceptional items in subsidiaries

Note 5

(916)

(47)

Group share of tax charge on exceptional items within joint ventures and associates

Note 5

4,699

1,525

Tax charge on underlying activities

36,389

27,529

Adjusted profit before tax

As calculated earlier

116,002

98,330

Effective tax on underlying activities

31.37%

28.0%

Net debt

Definition

Net debt is a non-IFRS measure which comprises bank deposits, cash and cash equivalents and current and non-current borrowings. It excludes lease liabilities. The calculation is outlined in Note 12.

Routine capital expenditure and non-routine capital expenditure

Definition

Routine capital expenditure is cash spend on property, plant, and equipment and software (which under IFRS is classified within intangible assets) less proceeds on disposal of property, plant and equipment and any expenditure classified as non-routine or development capital expenditure.

Non-routine capital expenditure is expenditure on projects to grow the business and generally relate to the acquisition, and fit out of new facilities or extending the capacity of existing facilities.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Acquisition of property, plant and equipment

Cashflow Statement

15,011

19,518

Acquisition of intangible assets - computer software

Cashflow Statement

5,370

4,621

Proceeds on disposal of property, plant and equipment - routine

Cashflow Statement

(783)

(678)

Non-routine (development capital expenditure)

Note (a)

(4,157)

(4,470)

Routine capital expenditure

15,441

18,991

(a) Non-routine capital expenditure is expenditure on projects to grow the business and generally relate to fit out of new facilities or extending the capacity of existing facilities.

Adjusted operating cashflow

Definition

Adjusted operating cashflow is the operating cashflow generated from operations as reported in the Group Cashflow Statement before cash outflows associated with exceptional items less lease liability payments and development loans provided to joint ventures and associates.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Net cashflow from operating activities per cashflow statement

Cashflow Statement

136,772

73,776

Cash impact of exceptional items in operating cashflows

Note 11

348

3,489

Less lease liability payments

Cashflow Statement

(23,497)

(17,902)

Adjusted operating cashflow

113,623

59,363

Free Cashflow

Definition

Free Cashflow is defined by the Group as the funds available after outflows relating to routine capital expenditure, dividends paid to non-controlling interests but before acquisition related expenditure (including loans advanced to joint ventures and associates), development capital expenditure and the payment of dividends to equity shareholders.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Net cashflow from operating activities per cashflow statement

Cashflow Statement

136,772

73,776

Cash impact of exceptional items in operating cashflows

Note 11

348

3,489

Less lease liability payments

Cashflow Statement

(23,497)

(17,902)

Dividends received from joint ventures and associates

Cashflow Statement

11,337

10,652

Dividends paid to non-controlling interests

Cashflow Statement

(20,510)

(16,055)

Routine capital expenditure

As calculated earlier

(15,441)

(18,991)

Free Cashflow

89,009

34,969

Net Debt/Adjusted EBITDA

Definition

Net debt is a measure of the Group's leverage and is calculated by dividing net debt (as defined earlier) by adjusted EBITDA (as defined earlier).

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Net debt

Note 12

144,293

221,193

Adjusted EBITDA

As calculated earlier

219,422

202,803

Net debt/ Adjusted EBITDA (times)

0.7 x

1.1 x

Interest cover: EBITA interest cover

Definition

Interest cover is a measure of the Group's ability to meet its interest payments and is calculated by dividing Adjusted EBITA (as defined earlier) by net financial expense.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Adjusted EBITA

As calculated earlier

164,238

150,114

Net financial expense

Income Statement

9,924

10,967

Adjusted EBITA/net finance expense (times)

16.5 x

13.7 x

Acquisition related expenditure, net

Definition

Acquisition related expenditure is cash outflows in respect of acquisition and investment in subsidiaries, joint ventures and associates, non-controlling interests and is net of contributions from non-controlling interests and proceeds on disposal of shares to non-controlling interests and proceeds from sale of equity investments.

Calculation

Reference in Financial

Information

Unaudited

2020

€'000

2019

€'000

Cash (inflow)/outflow relating to investment and return of investment in joint ventures and associates

Cashflow Statement

(472)

7,145

Investment in subsidiaries

Note 10

1,265

6,683

Proceeds from disposal of joint venture

Cashflow Statement

(98)

(48)

Acquisition of non-controlling interests

Cashflow Statement

796

1,656

Disposal of shareholding to non-controlling interest

Cashflow Statement

(285)

-

Proceeds on disposal of investments for resale

Cashflow Statement

(2,727)

(1,043)

Acquisition of equity investments

Cashflow Statement

-

150

Acquisition related expenditure

(1,521)

14,543