Good morning, ladies and gentlemen. Welcome to the Zeder full year results presentation. My name is Johann le Roux. This morning I'll take you through a short presentation of what's transpired at Zeder over the past financial year. On the agenda for today, I'll discuss a noteworthy transaction, that would be the disposal of Capespan. I'll spend some time on our financial results. I'll update some of the parts, as well as the business environment that we currently operate in. I'll discuss the relevant factors at our two remaining portfolio companies, then spend some time on strategy. Please can I ask that you can, during the presentation, email your questions to the email address on the screen, the cosec@zeder.co.za. Then I'll be available to answer the questions at the end of the presentation.
In terms of noting transactions, transaction has been published already notified on SENS, that's the disposal of Capespan, excluding the Pome assets. This transaction closed in February this year. As a result, we paid a special dividend to shareholders that was paid in March. The consideration for the transaction was ZAR 550 million, of which Zeder received ZAR 511 million. I think it's important to note that the remaining Pome investment still has a relationship with Capespan in terms of the marketing. Even though there are expertise on the farms and the packhouse, in order to operate the business, the marketing is still being done by the Capespan Group. We now are shareholders with the previous Capespan minorities in the remaining Pome division that consists of three farm and a packhouse in Paarl.
Previously, it was also mentioned that Zeder would offer a working capital facility in the interim to Capespan or to the Capespan Pome division. This has subsequently been refinanced repaid to Zeder also subsequent to year-end. As I mentioned, a dividend of ZAR 308 million paid to shareholders in March this year, subsequent to year-end. In terms of our financial results, the operating environment, I think if you look at the graph, that is the Agribusiness Confidence Index. You'll see that we are probably at the lowest level apart from the Q2 2020, which was at the height of the COVID pandemic. I think generally, it's been a very difficult year for agribusinesses, not in all areas and not specifically agribusinesses in the Western Cape or the northern parts of the country. I think these factors really emanate from exactly the same factors as previously.
It's about port inefficiencies, poor railroad municipal services. I think this is leading to a negative sentiment. In addition, in terms of the weather patterns, we're going through El Niño cycle. That had an impact on our portfolio. I think in the long term, or the medium term at least, we expect this volatility to continue, especially with the upcoming elections at the end of May. In terms of our portfolio, I think we're lucky that a lot of these factors are not really relevant. I think in terms of our Pome investments, our assets are all located in the Western Cape. Apples and pears are not as perishable as grapes. Therefore, even though there's port inefficiencies, you've got options in terms of cold storage. Grapes, you have to move very, very quickly, once they're picked.
Something like Pome, you can sell in the market over a longer period of time. Then our business, Zaad, even though there's El Niño in the Sub-Saharan parts of Africa, it's a diversified group with operations across the world. Just a little bit more specific in terms of our portfolio, significant items that had an impact. There's been a sharp decrease over a very short period of time of agrichemicals, raw materials that's normally imported from China and India. As a result of supply and chain issues, companies based in South Africa now probably have to order stock more regularly and earlier than usual to be able to obviously have stock to put in the market. As a result, at the drop in prices, there was some high-value stock that had to be worked out of the system.
I think the management job did a great job there, that obviously led to lower margins, obviously, as you sold this higher cost inventory in the market in order to retain your market share. You'll see the graph on the right, you can see the drop. That's a basket of agrichemical raw materials. In terms of some of our African operations, I think African currencies are under pressure. As all countries try to fight inflation, it leads to high interest rates over a longer period of time. The U.S. dollar has been very strong against many currencies. That makes imports expensive, leads to inflation, and therefore high interest rates at a longer time. As a result, we've obviously taken this into account.
We're considering our options in terms of some of our African subsidiaries and operations, we've also had approaches from third parties, we have to make certain decisions in terms of those jurisdictions. In terms of El Niño, it's been a very, very funny year. You'll see at the bottom there on the left, early in the season, there was a significant El Niño predicted. There were late rains in December, the news headlines were that we've escaped the biggest portion of El Niño because we had good rains. This all made it very, very difficult for farmers to decide what to plant. Normally, in an El Niño cycle, it's a very good year for sunflower sales, because sunflower is more drought tolerant than maize. As a result of the late rains in December, farmers opted to plant further maize in the late window.
As we all know, currently, the El Niño, the original prediction was correct, lots of maize crop failures across large parts of Africa. As a result, this had a negative impact at Agricol, where the sunflower sales was not as we expected at the beginning of the season. In terms of our results, our updated some of the parts, there's been a steady decrease. The decrease is all due to special dividends that's been paid during the year. If you compare February 2023 to February 2024, the decrease of ZAR 0.12, we have, however, over that period, paid special dividends to shareholders of ZAR 0.15. If you look at our February results, slight adjustments to our valuations. Our Zaad valuation, more or less in line with the previous slight decrease, our Pome investments, obviously an increase.
As you can note, Capespan is no longer part of this group. If you look at the 10th of April, you can see a further decrease in our some of the parts of ZAR 0.19, that obviously is explained by the special dividend of ZAR 0.20 that was paid in March. Other factors that's had an impact between February and April, you can see the other net assets, the ZAR 203 million that's moved to the ZAR 100 million. That's as a result of the refinance of the working capital facility that was offered to the Pome division, that's why we're sitting on more cash. The decrease in cash is also countered by the special dividend that was paid.
The Zeder board, as part of these results, have declared a further special dividend of ZAR 0.10, that will mean when that dividend is paid, which is expected in May, that ZAR 496 balance will decrease by a further ZAR 154 million. If you also look and you compare just to some of the parts to the share price, there's been a steady narrowing of our discount. The discount February 2023 was around 33%-34%, currently, it's about the 22%-23% range. When shareholders look at our income statement, you'll see the cost line from 2023 was ZAR 38 million, our operating costs, that went down to ZAR 34 million. The real recurring operating costs of Zeder's head office is lower than ZAR 20 million.
Anything above that is directly linked to transaction costs, as in when we dispose assets and have to pay advisors. Also included in that difference is a share-based payment cost, that is a result of share options issued during 2020. That will also decrease over time. That is also directly linked to any increase in share price. There's been no further share options issued since the February 2020 issuance. In terms of our remaining portfolio, we've got two assets remaining. You all know Zaad. The business run by Antonie Jacobs. It's had a mixed year. It's had a decrease in its reported recurring earnings on a 12-month basis. Is mainly as a result of the effect of the sharp decrease in chemical prices at FarmAg.
The EBITDA has more or less remained consistent, that's because of the negative effect below the line. We've seen increased interest rates in some of our African jurisdictions, also in Turkey, which obviously leads to higher finance charges. There's also been a tax adjustment in Turkey, which explains the difference between the lower earnings and the EBITDA that's more or less the same. December is the highest debt levels of the group, that also explains the comparable to June 2023 in terms of the slightly higher debt levels. In terms of the operations, I mentioned that the valuation was more or less consistent with the prior year. That valuation is based on a last 12-month results. Agricol had a record six months. The lower sunflower sales will impact H2.
Agricol is also a very strong player in canola and also in soya. We believe that the H2 sales, in terms of that, will negate any negative impact from the sunflower season. MAY Seed, our Turkish business, is performing very well under difficult trading conditions. It's obviously also a hyperinflation environment. It does seem like the correct economic decisions are being taken in Turkey. One must remember that Turkey has been a country that's been in and out of hyperinflation over the last 20 years. This is not something new to them. We've got a very good operational team there. They know how to operate. Also to mitigate any currency depreciations. A large part of their earnings or their revenue is actually in hard currency. We see lots of opportunities in that area of the world.
The Ukraine, Russian impact meant a lot of multinationals had to close shop in some of their Eastern European operations. We don't have any physical assets in those areas, but it does mean that people are looking at Turkey and other options, for alternative business, which has been very good for MAY Seed. In terms of FarmAg, I mentioned the drop in the agrichemical prices, the raw materials. It's had a short-term impact. I think in terms of their balance sheet, there's a very small percentage of that high inventory still left. I think there is some uncertainty in terms of when the prices will recover. Obviously, a higher price does give you a slightly bigger margin, but at least the management team was very proactive in working out the higher cost inventory. EAC, it's also had a much better start of the year. That's our East African operation.
We currently are a 40% shareholder there. We're very excited about this business and what it brings. It's got a significant and very interesting distribution channels in East Africa, in Kenya, Tanzania, Rwanda, Uganda. They operate in that part of the African continent. We also believe that there's some positive year expectations in terms of this business. Bakker Brothers, our Dutch business that operates in North Africa and the Middle East. Currently, no significant impact due to the issues within Gaza and also now in Iran. It's still in a transitional phase to a fully fledged IP company from a open-pollinated trading business. It's taken a little bit longer than anticipated. We have lost two years in terms of breeding as a result of COVID. It's taken a little bit longer than we expected and that we modeled into our models.
We've also been approached by certain parties in terms of Bakker Brothers. We're considering some options. Maybe we will consider partnering with a multinational on that business specifically. In terms of our African operations, I've also mentioned the high interest rate, depreciating currencies. I think it's seen everywhere in Africa. Once again, we're considering certain options there in some of our African jurisdictions. In terms of the Capespan Agri, these are the Pome investments, the three Western Cape based farms, and our pack house in Paarl. This business is being run by Johan de Klerk. It's had a phenomenal year. It's a record year for them. Earnings increased to ZAR 52 million. Revenue, EBITDA, EBIT, everything is positive. It's important to note that the net debt and cash on the balance sheet is all related to working capital. It's all linked to stock.
There's no real long-term debt in this business. If you look at the balance sheet, that ZAR 797, that is a balance sheet NAV adjusted for third party market related valuations. We've once again, as part of our year-end audit, performed third party valuations on all the farms as well as our packhouse. This is the first time that this is a standalone investment, it was, therefore, not appropriate to disclose the balance sheet NAV and the debt in the comparable prior year. In terms of their performance, as I mentioned, there's been an increase in earnings and as a result, an increase in our valuation from ZAR 540 million to ZAR 585 million. That's despite the decrease in our effective interest.
The reason for the decrease in our effective interest is, when we did the Capespan Group transaction, we took the decision to roll all incentives in terms of share options for management into this new structure, for shares to ensure that there's alignment in terms of the remaining portfolio and Zeder. I think that's been a good decision. We've had favorable conditions on most of our farms. We've had very good yields in 2023. Very good prices. That's obviously one of the key reasons why it's had such a good year. Our packhouse initially had lower volumes because there were a hail in the Ceres area in the prior year. Luckily, we had additional cooling income, which mitigated the lower volumes that was packed. The cooling income is directly linked to port in efficiencies.
If the fruit can't move, it needs to be in cold storage for longer, which is good for this business. As you know, if you're based in the Western Cape, we've had an extremely volatile summer. We've had sporadic rain, strong winds, and luckily there was very few damage at our farms in terms of infrastructure and also in terms of our biological assets. Other areas like the Hex River and Citrusdal were unfortunately not so lucky. We're busy packing or harvesting our 2024 Pome. The quality so far is good. The yields are good. Our early indications is that we'll have improved yields on 2023, which is good for the business. Obviously, prices in the market is uncertain because apple and pears is not something that you sell in a month window. You'll sell it at the right time, at the right price, over a 12-month period.
We've got world-class farming assets and packhouses, we have an experienced management team, even though this business is no longer part of the regional Capespan Group. In terms of our strategy, our strategy has always just remained unchanged. My job is to maximize shareholder wealth. How did we do in the past financial year? Yes, we've managed to sell Capespan. We've paid for the special dividends to shareholders. I think if you include the ZAR 0.10 dividend that's been declared now as part of these year-end results, it would be just under ZAR 700 million that's been returned to shareholders in this year. We'll probably have the question of why the dividend wasn't higher, I think our board's just taking a conservative view for now. I think we're confident of further transactions, further transactions will definitely mean further special dividends to shareholders.
In terms of our remaining two portfolio assets, we don't expect dividends from them during the coming year. Obviously, as a result of our discount, Zeder will not have the option to go raise money in the market, and there's no need for it. That's just the rationale from the board in terms of paying a lower dividend and still having a relatively big cash balance on our balance sheet. I think we've created value this year again. As mentioned, the discount has narrowed. That's completely out of our control, but it's good to see, and we believe that we've created value for shareholders in the past financial year. In terms of the remaining portfolio assets, I think our Pome investments, we've had positive interest from various parties on all our assets on the group as a whole, but also on individual assets.
I think the nature of this business is that we will have options and do have options on individual assets. If that's the right way to go and means a higher value realization for shareholders, that's what we will pursue. In terms of Zaad, we've made the decision to appoint an international advisor with our South African advisor. Rabobank is a very large agri bank based in the Netherlands, and PSG Capital has been involved in all those transactions so far. In terms of the approaches we've received on those assets, they're advising us on that. I think we've also made that appointment to be fair to our management teams and also to third party in terms of the process as follows. I think, once again, we have options on the table. We're evaluating that. We want to do it in a responsible manner.
We are in a critical stage of Zeder in terms of our two remaining assets. I think if there are further disposals, that will definitely lead to further dividends to shareholders for the remaining part of the year. That, ladies and gentlemen, brings me to the end of my presentation. If you'll just allow me a few minutes so we can collate all the questions, and I'll be back to answer them shortly. Thank you very much. Thank you, ladies and gentlemen. We're back. I've got a question about the working capital loan repayment from Capespan during April. Yes, that loan was repaid subsequent to year-end. When we look at the forecast of the agribusiness, they will no longer need financial assistance from Zeder. There was a question in terms of the M&A interest in Zaad and Pome investments, whether these are the same entities.
No, they are new entities. Also remember, in terms of the Pome investments, we now are considering options on individual assets as well. So, it would be the pack house and the three individual farms. There was a question about the EBITDA for Zaad's chemical business that's reduced and whether this is a permanent reduction. No, I don't think so. Obviously, I've disclosed the effect of the sharp drop in chemical raw material prices that had an impact at FarmAg, a significant impact at FarmAg. We have the view that that's obviously not recurring because we're buying stock at the lower price. I think the price realization in the market will probably be under pressure. I think we will probably expect lower earnings from FarmAg, but not the levels that we've seen over the past six months.
Also, there's the strong performance in terms of the associate seed business. That's mainly attributable to MAY Seed. We think it's a good business. We've seen some good growth from them, and we believe that that will continue going forward. There's a question about the appointment of Rabobank, whether they are appointed to look at the African assets of Zaad or a broader mandate. It's a broader mandate. It's a joint mandate with the PSG Capital team. It's mainly because Zaad has got international businesses as well. It's got a business in Turkey. It's got a business in Netherlands. Rabobank is based in those jurisdictions. We think it's just better in terms of communication and also speed of potential transaction to have an international bank advise us with our local South African advisor. That's also our sponsor.
There's a question about whether there are any tax consequences from selling the remaining two assets. If we take the published sum of the parts value of the two remaining assets, if we would sell those two assets, they would be tax payable, but it won't be significant. There's a question on the approaches for Zaad. Is it for the company as a whole or for specific segments? We've had approaches on both aspects. Obviously, our first prize would be to sell a business at the right price at the top. I think it'd obviously also be fair to the management teams. As one moves through this process, and similar to what happened in Capespan, we made a decision to split the business that made sense and was appropriate, and therefore, we did the one transaction on Capespan, and now we're left with the remaining Pome division.
A split to a certain effect can also be at Zaad, if appropriate, but obviously our first prize is still to do a transaction at the top level. There's a question about whether the processes on the Pome division is further progressed than Zaad. It's difficult for me to elaborate on that. Obviously, it's a South African asset or a farm as a whole would be much easier and quicker to sell than a global business with lots of moving parts. But obviously, we're not under cautionary currently. I've dealt with that question. Just see if there's any more questions. Let me just refresh quickly and see if there's anything coming through. Ladies and gentlemen, it doesn't seem like there's any more questions. If you have any more questions, please continue to send them through to that cosec email and I can respond to you directly.
Thank you for your time today. I appreciate it, and all the best. Thank you