Agricultural services group AFGRI reported a 10.3 percent improvement in headline earnings per share, in spite of the drought in SA, the company said on Wednesday.

It was releasing its 12-month interim period results ended February 29 2008.

The drought resulted in a lower maize crop for the second year in a row and a sharp drop in silo stock levels in 2007.

"The net effect of this is that the country actually lost an entire year's crop if one tallies the total crop for the last two years," managing director Jeff Wright said.

"We were able to mitigate the effect of this by focusing on internal efficiencies and better procurement practices."

The company's headline earnings per share rose to 68.5 cents on a 20 percent increase in sales.

Sales for the 12-month period totaled R7.8-billion, up from R6.5-billion for the prior year. Headline operating profit after interest totaled R322-million, up 2.9 percent on the previous year, excluding the effects of a R31-million once-off prior-year foreign exchange gain.

Financing costs increased to R443-million from R305-million due to a substantial increase in the debtors' book and higher interest rates, AFGRI said.

Looking forward, Wright said higher grain prices and excellent recent rainfalls had resulted in substantially higher maize plantings. This year's maize crop was seen as exceeding 11 million tons, ranking it among the highest ever achieved.

This was expected to have a positive impact on AFGRI's logistics business, which was highly dependent on the crop size and the volume of stock entering its logistics chain, Wright said.

Sapa