| Mon 17 Sep 2007, 10:48 | | ADW - African Dawn - Reviewed Interim Results: 6 m |
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ADW
ADW
ADW - African Dawn - Reviewed Interim Results: 6 months ended 31 August 2007
African Dawn Capital Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 1998/020520/06)
Share Code: ADW
ISIN Code: ZAE000060703
Reviewed Interim Results for the 6 months ended 31 August 2007
HIGHLIGHTS
EPS up 116 %
NAV up 138 %
Reviewed Reviewed Audited
BALANCE SHEETS 31 Aug 31 Aug 28 Feb
2007 2006 2007
R`000 R`000 R`000
ASSETS
Non current assets 74 070 46 818 33 534
Fixed assets 8 949 4 174 4 226
Financial receivables 28 139 34 917 18 411
Goodwill 36 982 7 727 10 897
Current assets 178 218 27 452 101 134
Financial receivables 127 755 17 615 80 016
Trade and other receivables 10 417 4 128 16 151
Cash and cash equivalents 40 046 5 709 4 967
Total assets 252 288 74 270 134 667
EQUITY AND LIABILITIES
Shareholders Equity 212 031 53 859 102 688
Share capital and premium 158 300 45 509 74 261
Accumulated profit 53 731 8 350 28 427
Non current liabilities 19 721 15 281 12 567
Borrowings 18 804 15 281 10 951
Lease liability 920 - 1 616
Current liabilities 20 533 5 130 19 412
Borrowings 3 540 2 891 12 664
Trade and other payables 4 181 383 1 485
Lease liability - - 809
Taxation 12 812 1 856 4 454
Total equity and liabilities 252 288 74 270 134 667
Shares in issue at period end 199 851 120 639 145 998
(`000)
Net asset value per share 106,09 44,64 70,34
(cents)
Reviewed Reviewed Audited
INCOME STATEMENTS 31 Aug 31 Aug 28 Feb
2007 2006 2007
R`000 R`000 R`000
Revenue 59 639 17 972 52 375
Operating expenses (13 691) (8 013) (17 958)
Cost of funding (9 243) - (2 800)
Profit before finance costs and 36 705 9 959 31 617
depreciation
Finance costs (48) (874) -
Depreciation and amortisation (224) (256) (487)
Profit before taxation 36 433 8 829 31 130
Taxation (11 129) (479) (3 579)
Net profit for the period 25 304 8 350 27 551
Headline earnings 25 304 8 350 27 551
Basic and diluted earnings per 15,6 7,2 21,2
share (cents)
Weighted average number of 162 508 116 706 129 806
shares (`000)
Headline earnings per share 15,6 7,2 21,2
(cents)
Reviewed Reviewed Audited
CASH FLOW STATEMENTS 31 Aug 31 Aug 28 Feb
2007 2006 2007
R`000 R`000 R`000
Cash flows from operating activities 27,415 8 110 20 223
Cash flows from investing activities 1,945 (1 867) (22 089)
Cash flows from financing activities 5,719 (1 868) 5 499
Net movement in cash and cash equivalents 35,079 4 375 3 633
Cash and cash equivalents at beginning of 4,967 1 334 1 334
year
Cash and cash equivalents at end of year 40,046 5 709 4 967
STATEMENT OF CHANGES IN EQUITY Share Share Acc Total
Capital Premium Profit
R`000 R`000 R`000 R`000
Balance as at 28 February 2006 918 26 190 876 27 984
Net profit for the period - - 27 551 27 551
Issue of share capital 542 46 611 - 47 153
Balance as at 28 February 2007 1 460 72 801 28 427 102 689
Net profit for the period - - 25 304 25 304
Issue of share capital 537 83 502 84 039
Balance as at 31 August 2007 1 997 156 303 53 731 212 031
COMMENTS
The Board of Directors is pleased to present the reviewed interim financial
results of the Group for the six months ended 31 August 2007.
NATURE OF BUSINESS
African Dawn is a niche finance provider and also markets affordable banking
solutions and residential property, operating within the following divisions;
* Short- Term Secured Finance (Financial)
* Home Improvement Finance (Financial)
* Financial Literacy Education (Financial)
* Cell phone Banking Solutions (Marketing)
* Property Sales (Marketing)
African Dawn endeavours to provide the above services to LSM 3 - 8 income
groups, enabling these clients to manage their own finances, enter the
mainstream banking fraternity, become property owners and/ or add value to their
existing properties.
HIGHLIGHTS
The Group generated R25,3m (2006: R8,4m) after tax profits for the six months
under review. This resulted in a 116% increase in earnings per share.
Net asset value per share increased to 106,09 cents per share at 31 August 2007,
compared to 44,51 cents at 31 August 2006.
FINANCIAL REVIEW
Financial receivables (short and long term) increased by R102,5m, mainly as a
result of increased activity in short term secured financing.
Goodwill increased due to the final payment in shares to the shareholders of
Bhenka Financial Services (Pty) Ltd on the fulfilment by Bhenka of their agreed
performance undertakings. This acquisition was concluded during the previous
financial year. Furthermore, goodwill of R18,5m was raised as a result of the
acquisition of the Elite group.
Share capital and premium increased as a result of the Bhenka share issues, as
well as the issue of 25m new shares for cash in August 2007 at R2,90 per share.
The analysis below, details the contribution of the two main divisions within
the Group:
Total Financing Education
activities and
marketing
Revenue 59 639 56 363 3 276
Net profit for the period 25 304 23 908 1 396
Net Asset Value 212 031 203 746 8 285
RECENT ACQUISITIONS
The group acquired all the shares & claims in Elite Group (Pty) Ltd on 22 August
2007. This will result in an expansion of African Dawn`s existing home
improvement loan book.
On 6 September 2007, African Dawn announced the acquisition of all the shares
and claims in CIA Holdings/ Allegro Group. This acquisition will increase the
existing short term secured finance loan book to over R300m.
PROSPECTS
The recent acquisitions have increased African Dawn`s prospects for continued
growth.
African Dawn now has a bigger footprint in existing markets, a wider product
offering, increased infrastructure as well as a larger client base. Cross
selling opportunities pertaining to the cell phone and financial literacy
products have also been created.
Furthermore, there will be a substantial increase in the advances book, and
additional credit facilities will further enhance growth.
Job creation has taken place countrywide, mainly in this income group, as a
result of Government`s infrastructure spend, Gautrain, infrastructure spend due
to 2010 and the buoyant property market. This bodes well for continued growth in
African Dawn`s business.
African Dawn is a registered finance provider and as such regulated by the
National Credit Act (NCA). The current negative effect on consumer credit is
expected to be short term, after which the NCA should have a positive impact on
our focus groups` financial wellbeing, which should lead to lower bad debts and
improved free cash flow.
COMPANIES ACT REQUIREMENTS
The reviewed interim financial statements were prepared in compliance with the
Companies Act and IFRS and IAS 34: Interim Financial Reporting.
CORPORATE GOVERNANCE
The Group subscribes to the principles of, and implements where possible, the
recommendations of the King II Code on Corporate Governance.
DIVIDENDS
The group will continue to retain and utilise cash generated within the
business, to maximise returns to shareholders. The Board will review the
dividend policy after the February 2008 financial year end.
REVIEW OPINION
The results have been reviewed by Van Dyk and Associates Inc. The unqualified
review report is available for inspection at the company`s registered office.
For and on behalf of the Board
JM VAN TONDER CM VAN NIEUWKERK
Chief Executive Officer Financial Director
17 September 2007
Registered office: 1st Floor, Dunkeld Place, 12 North Road, Dunkeld West
Transfer secretaries: Computershare Limited, Ground Floor, 70 Marshall Street,
Johannesburg
Directors: I Mophatlane* (Chairman), SW de Bruyn*, C de Wet Vivier*, CJ Odams,
MN Ramasehla, CM Van Nieuwkerk, JM Van Tonder
*Non-executive
Date: 17/09/2007 10:48:09 Produced by the JSE SENS Department.
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