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BWI
BWI
BWI - B&W Instrumentation and Electrical Limited - Audited results for the year
ended 31 august 2007
B&W Instrumentation and Electrical Limited
(Incorporated in the Republic of South Africa)
(Registration number 2001/008548/06)
Share code: BWI ISIN: ZAE000098687
("B&W" or "the company")
AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2007
* Revenue up 80% from 2006
* Headline earnings up 333% from 2006
* Earnings per share of 14.17 cents up 6.5% on forecast
* Headline earnings per share 14.26 cents
* Dividend of 3.5 cents per share
* Successfully listed on AltX
COMMENTS
Introduction
The directors are pleased to present the maiden annual financial results of B&W
as a listed entity for the year ended 31 August 2007 ("the year"), which reflect
profitability in line with pre-listing forecasts and significantly increased
from the previous year.
The year marked a milestone in the company`s history with a successful listing
on AltX on 5 July 2007. B&W`s share opened trade at a premium to the pre-listing
private placement of R1 per share, giving the company a market capitalisation on
listing of R416 million.
Basis of preparation
The annual financial statements have been prepared in accordance with
International Financial Reporting Standards ("IFRS"), IAS34 and the Companies
Act of South Africa, 1973. The consolidated annual financial statements set out
in this report are based on appropriate accounting policies, consistently
applied with those in the prior year, which are supported by reasonable and
prudent judgements and estimates.
Group profile
B&W is a leading niche provider of electrical and instrumentation ("E&I")
services to the industrial utilities, mining, chemical, oil and gas and food and
beverage industries. Services include equipment procurement, project
supervision, installation, post-installation specialised calibration and
commissioning and ongoing maintenance.
Review of operations
A key growth driver for B&W during the year was the ongoing expansion in the
mining, energy and oil and gas sectors. Further, a number of key contracts were
accelerated at the request of clients, boosting both top and bottom line growth
ahead of pre-listing forecasts.
Financial results
Revenue increased by 80% to R294 million from the previous year while operating
profit increased from R9.3 million to R35.1 million. Net profit after tax rose
326% from R5.8 million in 2006 to R24.8 million. Headline earnings per share of
14.26 cents and earnings per share of 14.17 cents are 6.5% higher than the
forecast set out in the pre-listing prospectus.
Prospects
The outlook for the industry and the company remains buoyant. Active projects in
B&W`s target market are estimated to total approximately R2 billion in 2007 and
R2.8 billion in 2008.
The company is well on track to achieve the pre-listing forecast revenue for
2008 of R336 million, with R240 million secured to the end of the reporting
period. In light of the average duration of a project from tender to completion
of six to nine months, B&W is confident of achieving the balance.
Organic growth is expected to be driven by a number of projects currently in the
feasibility or planning stages in the industry in South Africa. Further,
opportunities in the mining and power generation sectors have been identified in
sub-Saharan Africa and the company is actively targeting these prospects. In
addition, B&W will continue to investigate establishing capability in nuclear
construction, a new focus area, to capitalise on planned nuclear sites in South
Africa.
Taking these factors into account B&W believes that there is adequate
sustainable demand to support long-term future growth.
Dividend policy
In line with the forecast set out in the pre-listing prospectus (3.3 cents per
share), notice is hereby given that a cash dividend of 3.5 cents per share has
been declared for the year, equating to a distribution of 25% of earnings per
share.
The dividend is payable to shareholders recorded in the books at the close of
business Friday, 30 November 2007. Shareholders are advised that the last day to
trade "cum" the dividend will be Friday, 23 November 2007. The shares will trade
"ex" the dividend as from Monday, 26 November 2007. Payment will be made on
Monday, 3 December 2007. Share certificates may not be dematerialised or
rematerialised during the period Monday, 26 November 2007 to Friday, 30 November
2007, both days inclusive.
Audit opinion
The annual financial statements for the year ended 31 August 2007 have been
audited by B&W`s auditors Carrim, Maritz & Associates South Africa Inc. Their
unqualified audit report is available for inspection at the company`s registered
office.
Appreciation
We thank all of our employees for their loyalty, hard work and commitment which
have contributed to the successful listing on AltX and a strong performance. We
also extend our thanks to our fellow directors for their wise counsel and
guidance. Finally we thank our stakeholders for their consistent faith in the
group.
John Barrow
Chairman
Brian Harley
Managing Director
On behalf of the board.
6 November 2007
Directors:
John Barrow (Chairman), Brian Harley (Managing Director), Danie Evert (Financial
Director), Johan Breedt, Tom Lombard, Neels Minnie**, Ken Nel, Dean Nevay, Johan
Rall**, Gary Swanepoel, Sam Vilakazi, Wolf Wassermeier*, Jimmy Oosthuizen*,
Unati Mabandla*
*Non-executive director
Independent
**Alternate
Registered office:
Master Business Associates VII (Proprietary) Limited, 139 Everfair Avenue
Randjesfontein, Midrand, 1685
(Private Bag X168, Halfway House, 1685)
Designated Advisor:
Merchant Sponsors(Proprietary) Limited
Transfer secretaries:
Computershare Investor Services 2004 (Proprietary) Limited 70 Marshall Street,
Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Company secretary:
Master Business Associates VII(Proprietary) Limited, 139 Everfair Avenue
Randjesfontein, Midrand, 1685
(Private Bag X168, Halfway House, 1685)
BALANCE SHEET
Audited Audited
31 August 2007 31 August 2006
R`000 R`000
Assets
Property, plant and 6 486 4 548
equipment
Amounts owing by group
companies 6 034 1 413
Current assets 120 322 53 774
Total assets 132 842 59 735
Equity and liabilities
Capital and reserves 64 944 7 868
Non-current liabilities 8 124 16 850
Current liabilities 59 774 35 017
Total equity and
liabilities 132 842 59 735
Pro forma weighted average
number of ordinary shares 175 000 000 45 000 000
Net asset value per pro
forma ordinary share
(cents) 37.11 17.48
Net tangible asset value
per pro forma ordinary
share (cents) 37.11 17.48
Net asset value per ordinary share is based on the 200 000 000 shares in issue
at the end of August 2007 and on 45 000 000 shares in issue at the end of August
2006.
INCOME STATEMENT
Audited Audited
31 August 2007 31 August 2006 % change
R`000 R`000
Revenue 294 043 163 622 80
Costs of sales (239 584) (139 312)
Gross profit 54 459 24 310 124
Other income 433 69
Operating costs (19 819) (15 032)
Operating profit 35 073 9 347 275
Interest
received 1 682 200
Finance costs (875) (741)
Profit before
tax 35 880 8 806 307
Taxation (11 089) (2 983)
Profit after
taxation 24 791 5 823 326
Adjustments for
headline
earnings 161 (62)
Headline
earnings
attributable to
ordinary
shareholders 24 952 5 761 333
Pro forma
weighted average
number of
ordinary shares
in issue 175 000 000 45 000 000
Pro forma
weighted average
earnings per
ordinary share
(cents) 14.17 12.94
Pro forma
weighted average
headline
earnings
per ordinary
share (cents) 14.26 12.80
Dividend per
share 3.5 1.1 182
STATEMENT OF CHANGES IN EQUITY
Share Share Distributable
capital premium reserve Total
R`000 R`000 R`000 R`000
2006
Balance at 1 March * * 3 948 3 948
2005
Net profit for the 5 822 5 822
period
Dividends declared (1 902) (1 902)
Reduction of share
capital resulting
from repurchase of * * * *
shares
Balance at 31 * * 7 868 7 868
August 2006
2007
Balance at 1 * * 7 868 7 868
September 2006
Net profit for the 24 791 24 791
period
Issue of share 2 32 283 32 285
capital
Balance at 31 2 32 283 32 659 64 944
August 2007
*Less than R1 000
CASH FLOW STATEMENT
Audited Audited
Year ended Year ended
31 August 2007 31 August 2006
R`000 R`000
Cash flow from operating 10 397 19 565
activities
Cash flow from investing (2 949) (3 948)
activities
Cash flow from financing 15 509 1 872
activities
Increase in cash and cash 22 957 17 489
equivalents
Cash and cash equivalents at 10 596 (6 893)
the beginning of the period
Cash and cash equivalents at 33 553 10 596
the end of the period
August 2007 August 2006
R`000 R`000
Non-current liabilities
Deferred tax 8 124 5 268
Shareholders loan 2 382
Wesbank financing 572
Amount owed due to reduction 1 084
of share capital
6% redeemable non-cumulative 8 000
preference shares
8 124 17 306
Less: Short term portion (456)
8 124 16 850
Date: 06/11/2007 09:00:09 Produced by the JSE SENS Department.
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