| Tue 11 Sep 2007, 11:45 | | SFN / SFNP - Sasfin - Abridged Audited Group Resul |
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SFN SFNP
SFN
SFN / SFNP - Sasfin - Abridged Audited Group Results For The Year Ended 30 June
2007 Conditional Specific Issue Of Shares For Cash And Withdrawal Of
Cautionary Announcement
Sasfin Holdings Limited
Unlimited Financial Horizons
(Incorporated in the Republic of South Africa
("Sasfin" or "the Group" or "the Company")
(Ordinary share code: SFN ISIN: ZAE000006565)
(Preference share code: SFNP ISIN: ZAE000060273)
Registration Number: 1987/002097/06
ABRIDGED AUDITED GROUP RESULTS FOR THE YEAR ENDED 30 JUNE 2007
CONDITIONAL SPECIFIC ISSUE OF SHARES FOR CASH AND WITHDRAWAL OF CAUTIONARY
ANNOUNCEMENT
Headline earnings - R140 million up 32%
Headline earnings per ordinary share - 523 cents up 29%
Ordinary dividends per share - 207 cents up 29%
Return on ordinary shareholders` average equity 31%
Return on total average assets 6%
Efficiency ratio further improved from 58% to 56%
FINANCIAL HIGHLIGHTS
30 June 2007 30 June 2006
% Audited Audited
Change R`000 R`000
Share statistics
Headline earnings per ordinary 29 523 404
share (cents)
Earnings per ordinary share (12) 524 596
(cents)
Diluted headline earnings per 31 514 391
ordinary share (cents)
Diluted earnings per ordinary (11) 514 577
share (cents)
Number of ordinary shares in 27 013 26 586
issue at end of the year (`000)
Weighted average number of 26 714 26 271
ordinary shares in issue (`000)
Diluted weighted average 27 200 27 104
ordinary shares in issue (`000)
Dividends per ordinary share 29 207 161
relating to profit for the year
(cents)
Of which interim 73 62
Of which final 134 99
Dividends per preference share 909,35 789,76
relating to profit for the year
(cents)
Of which dividend number 3 396,99
Of which dividend number 4 392,77
Of which dividend number 5 442,09
Of which dividend number 6 467,26
Net asset value per ordinary 22 1 844 1 507
share (cents)
Financial performance
Return on ordinary shareholders` 31,1 31,2
average equity (%)
Return on total average assets 12 5,6 5,0
(%)
Operating performance
Non-interest income to total (3) 74,3 76,5
income (%)
Efficiency ratio (%) 55,6 57,9
Capital adequacy (unaudited)
Group capital to risk-weighted 33,7 31,2
assets (%)
Sasfin Bank Limited capital to 31,7 28,3
risk-weighted assets (%)
CONSOLIDATED BALANCE SHEETS
30 June 2007 30 June 2006
% Audited Audited
Change R`000 R`000
Assets
Cash and cash equivalents 394 394 681 635
Short-term negotiable securities 35 372 24 922
Loans and advances to customers 27 1 508 201 1 189 078
Other receivables 298 776 394 783
Investment securities 191 178 212 61 157
Investments in associated and 60 139 49 413
joint venture companies
Property and equipment 60 544 49 376
Intangible assets and goodwill 6 458 9 080
Deferred tax asset 2 856 463
Total assets 3 2 544 952 2 459 907
Liabilities
Deposits from banks 29 186 78 512
Deposits from customers 19 745 781 626 851
Other payables 235 219 320 900
Debt securities issued 674 974 670 830
Provisions 11 457 10 670
Taxation 32 017 39 499
Deferred tax liability 41 903 44 017
Total liabilities 1 770 537 1 791 279
Equity
Ordinary share capital and share 25 703 23 525
premium
Reserves 25 472 529 377 186
Preference share capital and 199 278 199 278
share premium
Total equity attributable to 697 510 599 989
equity holders of the parent
Minority interest 76 905 68 639
Total equity 16 774 415 668 628
Total liabilities and equity 3 2 544 952 2 459 907
Commitments and contingencies 101 118 265 183
CONSOLIDATED INCOME STATEMENTS
30 June 2007 30 June 2006
% Audited Audited
Change R`000 R`000
Interest income 261 755 205 143
Interest expense 126 682 92 552
Net interest income 20 135 073 112 591
Impairment losses on loans and 37 10 345 7 571
advances
Net income from lending 19 124 728 105 020
activities
Other income 6 389 986 366 297
Operating income 9 514 714 471 317
Operating expenses 19 291 923 245 444
Profit from operations 222 791 225 873
Share of associated and joint 5 185 4 277
venture companies` income
Profit before income tax 227 976 230 150
Income tax expense 56 601 55 472
Profit for the year 171 375 174 678*
Profit attributable to:
Minority interest 15 552 10 244
Preference shareholders 15 904 7 985
Equity holders of the parent 139 919 156 449
Profit for the year 171 375 174 678*
Basic earnings per share (12) 524 596
Diluted earnings per share (11) 514 577
* Includes the once-off realised capital gain of R50,4 million on disposal of
investments net of capital gains tax
HEADLINE EARNINGS RECONCILIATION
30 June 2007 30 June 2006
% Audited Audited
Change R`000 R`000
Headline earnings are determined
as follows:
Profit attributable to equity 139 919 156 449
holders of the parent
Capital gains (119) (50 399)*
Headline earnings 139 800 106 050
Headline earnings per ordinary 29 523 404
share (cents)
* Represents the once-off realised capital gain on disposal of investments net
of capital gains tax
CONSOLIDATED CASH FLOW INFORMATION (CONDENSED)
30 June 30 June
2007 2006
Audited Audited
R`000 R`000
Cash flows from operating activities (124 905) 222 462
Cash flows from investing activities (104 479) (21 894)
Net cash flows from financing activities (1 944) 147 348
Net (decrease)/increase in cash and cash (231 328) 347 916
equivalents
Cash and cash equivalents at beginning 628 045 280 129
of the year
Cash and cash equivalents acquired 3 863 -
Cash and cash equivalents at end of the 400 580 628 045
year
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (CONDENSED)
30 June 2007 30 June 2006
Audited Audited
R`000 R`000
Opening total shareholders` equity 668 628 396 445
Change in minorities 8 266 51 642
Issue of shares 2 178 103 343
Change in available for sale reserve 793 68
Change in share-based payment reserve 633 367
Profit for the year (excluding minority 155 823 164 434
interest)
Preference share dividend (15 904) (7 985)
Ordinary share dividend (46 002) (39 686)
Closing balance 774 415 668 628
SEGMENTAL ANALYSIS (CONDENSED)
30 June 2007 30 June 2006
Audited Audited
R`000 R`000
Business Banking 55 776 54 709
Capital (excluding Treasury) 27 471 7 479
Treasury 27 975 15 081
Wealth Management 21 072 23 049
Specialised Services 7 506 5 732
Headline earnings 139 800 106 050
COMMENTARY
NATURE OF BUSINESS
Sasfin Holdings Limited ("Sasfin" and/or "the Company") is a bank-controlling
company listed in the "Financials: Investment Services" sector of JSE Limited
("JSE"). Sasfin and its subsidiaries provide a wide range of complementary
banking, financial and related services.
BUSINESS REVIEW: GROUP PERFORMANCE
* In its 20th year as a JSE listed company, Sasfin has continued to build on its
core business activities, as well as to derive benefits from the more recently
established business units. The growth in headline earnings per ordinary share
is pleasing and reflects the meaningful contributions to Group headline earnings
made by all business units.
* Although profit year on year shows a marginal decrease of 2%, the actual
increase in profit translates to 38% when the once off capital gain from the
realisation of the JSE shares in 2006 is excluded.
* Whilst total Group assets showed marginal growth to R2,5 billion (2006: R2,4
billion), loans and advances grew by 27% to R1,5 billion. Despite this increase,
non-performing loans and advances were maintained well within acceptable levels.
* The statutory risk-weighted capital adequacy of Sasfin Bank Limited ("the
Bank") is 32% (2006: 28%), well in excess of regulatory requirements.
* Sasfin`s efficiency ratio continued to improve from 58% to 56% year on year.
CONDITIONAL SPECIFIC ISSUE OF SHARES FOR CASH TO CIRCLE CAPITAL VENTURES (PTY)
LIMITED ("CIRCLE CAPITAL")
Further to the cautionary announcements published on 7 May 2007, 19 June 2007
and 30 July 2007, shareholders are advised that Sasfin has, subject to the
fulfilment of certain suspensive conditions, entered into an agreement in terms
of which it will allot and issue 9 630 000 new Sasfin ordinary shares to Circle
Capital as a specific issue of shares for cash at a subscription price of R495
million or R51,40 per share ("the specific issue of shares" or "the
transaction").
Circle Capital is a black-owned investment holding company, whose Chairperson is
Dr Mamphela Ramphele and Chief Executive is Mr Hlumelo Biko. Circle Capital was
incorporated in 2002. Its business interests include a portfolio of diversified
private equity investments as well as corporate finance activities, which will
complement those conducted by Sasfin. In addition, Sasfin anticipates that it
will benefit from the new business opportunities which Circle Capital will be
able to introduce to the Group.
The transaction will result in Circle Capital owning 26% of the issued ordinary
shares of the Company. The specific issue of shares is subject to the fulfilment
of certain suspensive conditions which include regulatory approvals, the
approval of the requisite majority of Sasfin`s shareholders in a general
meeting, and the completion of a due diligence investigation. Circle Capital is
in the process of securing the necessary funding for the transaction.
It has been agreed with the Bank`s existing black economic empowerment
shareholder, InnoVent Investment Holdings (Pty) Limited ("InnoVent"), that
following the implementation of the specific issue of shares, their funding
structure will be restructured. It is anticipated that this will result in
InnoVent owning approximately 3% of the Company.
The table below illustrates the unaudited pro forma financial effects of the
transaction based on the published audited results for the year ended 30 June
2007. The preparation of the unaudited pro forma financial effects is the
responsibility of the directors of Sasfin. The unaudited pro forma financial
effects have been prepared for illustrative purposes only to provide information
on how the transaction may have impacted on Sasfin`s results and financial
position, and due to the nature thereof, may not give a fair reflection of
Sasfin`s results and financial position.
Before After % Change
Headline earnings (R`000) 139 800 171 550 23
Earnings per ordinary share (cents) 524 468 (11)
Headline earnings per ordinary share 523 468 (11)
(cents)
Net asset value per ordinary share 1 844 2 806 52
(cents)
Tangible net asset value per ordinary 1 821 2 789 53
share (cents)
Number of ordinary shares in issue 27 013 36 643 36
(`000)
Weighted average number of ordinary 26 714 36 344 36
shares in issue (`000)
Notes:
1. The figures in the "Before" column are extracted from the published audited
results for the year ended 30 June 2007.
2. The figures in the "After" column assume that:
a. The transaction was implemented on 1 July 2006 for earnings purposes and an
after-tax return of 7% was generated on the R495 000 000 received; and
b. The transaction was implemented on 30 June 2007 for net asset value
purposes.
FURTHER DOCUMENTATION AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
A circular to shareholders containing the requisite information pertaining to
the transaction and convening a meeting of shareholders will be posted to
shareholders in due course.
Having regard to the information disclosed above, shareholders are advised that
they no longer need to exercise caution when dealing in the Company`s
securities.
OTHER STRATEGIC DEVELOPMENTS
* South African Reserve Bank approval has been granted for the Bank to become an
Authorised Dealer in Foreign Exchange, and an International Treasury unit has
been established to execute foreign exchange and related transactions.
* The Bank has been licensed as a Financial Services Provider by the Financial
Services Board.
* Sasfin Asia Limited ("SAL"), a 100% owned subsidiary of the Bank, acquired the
entire share capital of SasCred Financial Services Limited ("SasCred")
(previously a 50% joint venture with Credo Group, an international financial
services group). SAL and SasCred have now established offices in Hong Kong.
* The Group has restructured its term equipment rental securitisation vehicle
into an evergreen structure. The securitisation vehicle, which is changing its
name from Equipment Rentals Securitisation No. 1 (Pty) Limited to South African
Securitisation Programme (Pty) Limited, will be a segregated asset, multi-seller
Domestic Medium Term Note Programme, enabling Sasfin and its clients to
securitise any asset class which can be funded by means of short-, medium-
and/or long-term notes.
* The Group is on track for the implementation of Basel II scheduled for January
2008 and with its internal capital assessments and risk adjustments.
THE FINANCIAL SECTOR CHARTER
The Group subscribes to the Charter and is pleased to report that its
empowerment programme is ahead of schedule. The Group is well placed to achieve
the 2008 Charter targets.
PROSPECTS
* The demand by Sasfin`s target market for its products and services remains
strong.
* Sasfin is gearing up for expansion in all areas of its business.
BASIS OF PREPARATION AND PRESENTATION OF ANNUAL FINANCIAL STATEMENTS
* The Group`s annual financial statements are prepared in accordance with
International Financial Reporting Standards. The accounting policies are
consistent with those adopted in the previous year, except for the adoption of
accounting standards and interpretations issued with an effective date of 1
January 2006. The adoption of these standards and interpretations has not had a
material effect on the results, nor has it required any restatement of the
results.
* The abridged annual financial statements comprise a consolidated balance sheet
at 30 June 2007, and a consolidated income statement, a condensed statement of
equity, a condensed cash flow statement and condensed segment analysis report
for the year ended 30 June 2007.
* Reclassifications
The Group reclassified certain balance sheet items and segmental analysis
figures in its 2006 results relating to appropriate line items to conform with
presentation in the current year. These reclassifications did not impact profit
or equity attributable to ordinary shareholders of the Group.
* Audit opinion
These abridged financial statements have been extracted from the audited
financial statements on which KPMG Inc. and PKF Inc. have issued an unqualified
audit opinion. This report is available for inspection at the Company`s
registered office.
PREFERENCE SHARE DIVIDEND
Notice is hereby given that preference dividend number 6 amounting to 467,26
cents per preference share ("preference dividend") will be declared for the
period 1 January 2007 to 30 June 2007, on one million preference shares issued
at R100,00 each, and on nine hundred and five thousand preference shares issued
at R110,49 each. The preference dividend will be payable to holders of
preference shares recorded in the register of the Company at the close of
business on Friday, 26 October 2007.
The salient dates relating to the preference dividend are as follows:
Last day to trade cum the preference Friday, 19 October 2007
dividend
Preference shares commence trading ex the Monday, 22 October 2007
preference dividend
Preference dividend record date Friday, 26 October 2007
Payment of preference dividend Monday, 29 October 2007
Preference shares may not be dematerialised or rematerialised between Monday, 22
October 2007 and Friday, 26 October 2007, both days inclusive.
FINAL ORDINARY SHARE DIVIDEND
Notice is hereby given that a final ordinary share dividend for the financial
year ended 30 June 2007, amounting to 134 cents per share (2006: 99 cents per
share) ("ordinary dividend") will be declared. The ordinary dividend will be
payable to holders of ordinary shares recorded in the register of the Company at
the close of business of Friday, 2 November 2007.
Together with the interim ordinary dividend of 73 cents declared on 5 March
2007, the total ordinary dividends for the financial year amount to 207 cents
per share (2006: 161 cents per share).
The salient dates relating to the ordinary dividend are as follows:
Last day to trade cum the ordinary dividend Friday, 26 October 2007
Ordinary shares commence trading ex the Monday, 29 October 2007
ordinary dividend
Ordinary dividend record date Friday, 2 November 2007
Payment of ordinary dividend Monday, 5 November 2007
Ordinary shares may not be dematerialised or rematerialised between Monday, 29
October 2007 and Friday, 2 November 2007, both days inclusive.
BOARD CHANGES
Dennis Paizes, a non-executive director of the Company, retired in December
2006. The Board thanks him for his valuable contribution and wishes him well on
his retirement.
In May 2007, Dolly Mokgatle and Shahied Rylands were appointed as non-executive
directors of the Company.
For and on behalf of the Board.
MB GLATT RDEB SASSOON
Chairman Chief Executive Officer
11 September 2007
This announcement and additional information is available on the website:
www.sasfin.com
Non-Executive Chairman:
MB Glatt
Executive Directors: RDEB Sassoon * (Chief Executive Officer),
AW Greenstein (Managing Director), M Segal
* British
Non-Executive Directors:
CN Axten, ETB Blight, DD Mokgatle, MS Rylands, ML Smith
Company Secretary:
S Jackson
Registered Office:
Sasfin Place, 13-15 Scott Street, Waverley, 2090, Johannesburg
Tel: +27 11 809 7500
Fax: +27 11 887 6167/2489
Websites: www.sasfin.com/www.sfpsecurities.com
Transfer Secretaries:
Computershare Investor Services 2004 (Pty) Limited, 70 Marshall Street,
Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Lead Sponsor:
KPMG Services (Pty) Limited
Joint Sponsor:
Sasfin Capital (a division of Sasfin Bank Limited)
Corporate Law Advisors:
Edward Nathan Sonnenbergs Inc.
Date: 11/09/2007 11:45:01 Produced by the JSE SENS Department.
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