| Fri 29 Feb 2008, 15:12 | | CCI - CIC - Group interim results for the 6 months |
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CCI
CCI
CCI - CIC - Group interim results for the 6 months ended 31 December 2007
CIC Holdings Limited
(Incorporated in the Republic of Namibia)
(Registration number 95/502)
(Registered as an external company in the Republic of South Africa)
(Registration number 1996/002672/10)
Share code: CCI & ISIN: NA0009174278
("CIC" or "the Group")
GROUP INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2007
Key Information
- Revenue increased by 25,4% to N$ 957 million;
- Attributable earnings increased by 45,8% to N$ 14,3 million;
- Headline earnings per share increased by 32,3% to 7,2 cents per share.
Commentary
The Group successfully listed on the Altx on 30 November 2007. The listing on
Altx has increased the number of shares in issue from 202 188 081 to 252 188 081
through the private placement of 50 million shares at R1 per share.
The Group enjoyed good sales growth in all countries, with revenue increasing
25,4% to N$ 957 million.
The majority of the Groups revenue streams emanate from countries outside South
Africa and as such tend to be driven by their own economic circumstances.
Whilst top line revenue growth has shown significant increases, pressure on
rising costs mounted in order to service the market place, through higher
distribution, sales and marketing costs.
All fast moving consumer goods ("FMCG"), alcoholic beverages and tobacco
product categories within the agency business performed well. The staffing
solutions business showed pleasing results within the hospitality sector, but
the contract staffing labour division lost substantial business towards the end
of the 2007 calendar year. This was more than offset by the performance of the
other staffing solutions divisions.
The Group acquired an effective 25% shareholding in Vital Merchandising Services
Western Cape and increased its shareholding in Ocean Traders International in
the period under review.
Results
All businesses experienced good top line revenue growth. Total revenue grew by
N$193,8 million, an increase of 25,4%.
Profit from operations increased to N$26,3 million (2006: N$21,4 million), up
22,9% as the weighting to lower margin categories negatively affected
income/commission earned.
The Group`s share of the profits in its associate companies, being Vital
Merchandising Services, amounted to N$1,2 million (2006: Nil) for the period.
Profit before tax increased by 28,5% to N$24,7 million (2006: N$19,2 million).
Attributable profit to the Group shareholders increased by 45,8% to N$14,4
million. This was positively affected by the additional shareholding in Ocean
Traders International and the income from associate companies.
A total of 50 million new shares were issued pursuant to the listing of CIC on
the Altx.
This contributed to the weighted average number of shares in issue increasing to
198 546 333 shares at the end of December 2007.
Earnings and headline earnings per share increased by 32,3% to 7,2 cents (2006:
5.5 cents) per share for the period. Fully diluted earnings and headline
earnings per share increased by 16,9% a share.
The balance sheet reflects the increased working capital requirements in line
with the higher revenue growth.
The net cash proceeds from the issue of 50 million shares pursuant to the
listing on Altx amounted to N$47,3 million.
Prospects
The volatility seen in global markets and the South African energy crisis is
unlikely to damper the consumer goods markets within which the group operates
(outside of South Africa), in the short term.
The Namibian and Botswana markets have lived with intermittent power in 2007.
However, severe cuts from South Africa may have a negative effect in these
smaller countries with limited resources as winter comes into full swing.
On the positive side the countries of Mozambique, Botswana and Namibia all have
good growth rates with the prognosis that this will continue. The South African
FMCG agency business should continue to do well with VMS being well placed with
a good portfolio of Principals. The labour supply business continues to gain
new business in the technical and hospitality divisions. The concerns in the
medium term is whether South Africa will remain a "flavour" for international
conferences in 2009 and beyond, based on negative sentiment around energy
issues.
For and on behalf of the boardT P Rogers F W BritzChief
Executive Officer Financial director29 February 2008
ABRIDGED GROUP INCOME STATEMENT
6 months 6 months 12 months
ended ended ended
31/12/2007 31/12/2006 30/06/2007 Change
N$`000 N$`000 N$`000 %
UNAUDITED REVIEWED AUDITED
Revenue 957,360 763,545 1,529,402 25.4
Profit from operations 26,341 21,440 39,370 22.9
Depreciation 2,981 2,636 5,512 13.1
Net finance income/
(expense) 189 434 (145) (56.5)
Share of profit of
associates 1,172 - - -
Profit before tax 24,721 19,238 33,713 28.5
Tax 7,972 6,073 10,254 31.3
Profit for the period 16,749 13,165 23,459 27.2
Attributable to:
Equity holders of the
company 14,374 9,857 17,752 45.8
Minority interest 2,375 3,308 5,707 (28.2)
16,749 13,165 23,459 27.2
Earnings per ordinary
share
Basic 7.2 5.5 9.9 32.3
Fully diluted 5.7 4.9 8.8 16.9
Headline
earnings per
ordinary share
Basic 7.2 5.5 9.9 32.3
Fully diluted 5.7 4.9 8.8 16.9
Dividends per ordinary
share (cents) - - 4.4
Number of ordinary
shares in issue
Number of shares in issue 252,188 202,188 202,188
Weighted average
number of shares in issue 198,546 180,133 180,133
ABRIDGED GROUP BALANCE SHEET
6 months 6 months 12 months
ended ended ended
31/12/2007 31/12/2006 30/06/2007
N$`000 N$`000 N$`000
UNAUDITED REVIEWED AUDITED
ASSETS
Non-current assets 69,607 43,220 61,180
Property, plant and equipment 18,832 18,588 19,305
Intangible assets 29,529 17,344 25,111
Deferred tax 9,119 7,288 9,044
Investments in associates 12,127 - 7,720
Current assets 387,582 340,330 331,014
Inventories 102,652 90,284 88,644
Trade and other receivables 204,340 185,560 166,587
Taxation 1,983 1,473 2,383
Cash and cash equivalents 78,607 63,013 73,400
Total assets 457,189 383,550 392,194
EQUITY AND LIABILITIES
Capital and reserves attributable to
equity holders 177,550 134,187 139,754
Issued capital 130,902 83,542 83,542
Reserves 46,648 50,645 56,212
Minority interest 4,424 5,964 6,522
Total equity 181,974 140,151 146,276
Non-current liabilities 27,951 27,439 27,374
Interest-bearing borrowings 13,907 15,037 14,234
Deferred tax 348 345 349
Deferred operating lease liabilities 13,696 12,057 12,791
Current liabilities 247,264 215,960 218,544
Current portion of interest-bearing
borrowings 5,270 4,867 5,053
Accounts payable and accrued
liabilities 226,426 191,688 202,160
Taxation 9,216 3,364 5,151
Bank overdraft 6,352 16,041 6,180
Total equity and liabilities 457,189 383,550 392,194
Net asset value per share (cents) 70.4 66.4 69.1
ABRIDGED GROUP CASH FLOW STATEMENT
6 months 6 months 12 months
ended ended ended
31/12/2007 31/12/2006 30/06/2007
N$`000 N$`000 N$`000
UNAUDITED REVIEWED AUDITED
Cash generated by operations 28,940 22,527 41,387
Change in working capital (27,498) (43,346) (12,710)
Net finance and investment
income/(expense) 189 434 (145)
Dividends paid (8,502) (2,869) (4,263)
Taxation paid (4,375) (4,737) (9,793)
Cash flow from operating activities (11,246) (27,991) 14,476
Investment to maintain operations: (2,273) (5,324) (8,307)
- Additions to intangible asset (250) (1,943) (2,774)
- Additions to property, plant and
equipment (2,292) (4,077) (7,508)
- Proceeds on disposal of
property, plant and equipment 269 696 1,975
Investments in associate companies (3,455) - (7,720)
Investment in subsidiary &
acquisitions (25,241) - (9,706)
Cash flow from investing activities (30,969) (5,324) (25,733)
Proceeds from issue of shares
capital 47,360
Net movement in borrowings (110) 382 (235)
Cash flows from financing activities 47 250 382 (235)
Net movement in cash and cash
equivalents 5,035 (32,933) (11,492)
Cash and cash equivalents at
beginning of the period 67,220 78,712 78,712
Cash and cash equivalents at
end of period 72,255 45,779 67,220
STATEMENTS OF CHANGES IN SHAREHOLDERS` EQUITY
6 months 6 months 12 months
ended ended ended
31/12/2007 31/12/2006 30/06/2007
N$`000 N$`000 N$`000
UNAUDITED REVIEWED AUDITED
Balance at beginning as previously
reported 146,276 130,901 129,035
Share option reserve 310 396 811
Shares issued 47,360 - -
Shareholding increased in
subsidiary (16,236) - -
Subsidiaries - Transfer from
minority interest (4,337) - (1,917)
Translation of foreign entities 354 (664) (1,427)
Net profit for the period 16,749 13,165 23,459
Ordinary dividends (8,502) (3,647) (3,685)
Balance at end of the period 181,974 140,151 146,276
Comprising:
Share capital 230 180 180
Share premium 130,672 83,362 83,362
Share option reserve 2,414 1,720 2,104
Accumulated profit 49,038 53,320 59,266
Translation of foreign entities (4,804) (4,395) (5,158)
Minority interest 4,424 5,964 6,522
181,974 140,151 146,276
GROUP ACQUISITIONS FOR THE PERIOD ENDED 31 DECEMBER 2007
Material acquisitions
The following amounts are dislcosed in respect of acquisitons during the period
under review
Company Nature of Purchase Fair value of Premium
Effective date transaction consideration net assets paid
acquired
N$`000 N$`000 N$`000
Ocean Traders
International Increase in 20,573 4,338 16,235
01-Dec-07 shareholding
Foundation Group Business 4,622 0 4,622
01-Jul-07 acquired
Company Nature of Contribution since acquisition
Effective date transaction Revenue(1) Profit before
Tax(1)
N$`000 N$`000
Ocean Traders
International Increase in 17,802 2,032
01-Dec-07 shareholding
Foundation Group Business 6,980 1,683
01-Jul-07 acquired
Note:
The revenue and profit before tax includes 100% of Ocean Traders International
Group for the month of December 2007. CIC only acquired a further 29% in Ocean
Traders International (Pty) Limited and Ocean Traders International Marketing
(Pty) Limited and a further 14% in CIC (Swaziland) (Pty) Limited effective 1
December 2007.
Basis of preparation and accounting policies
The condensed consolidated interim financial statements for the six months ended
31 December 2007 have been prepared in accordance with International Accounting
Standard 34: Interim Financial Reporting.
These interim financial statements have not been audited or reviewed.
The accounting policies applied are consistent, in all material respects, with
those used in the Annual Financial Statements for the year ended 30 June 2007,
except as disclosed below.
The revised IAS 27: Consolidated and Separate Financial Statements was adopted
early during the current accounting period. IAS 27 states that changes in a
parent`s ownership interest in a subsidiary that does not result in a loss of
control are accounted for as equity transactions (i.e. transactions with owners
in their capacity as owners). The premium paid on the acquisition of the
additional shares in Ocean Traders International was therefore recognised
directly in equity.
Post-balance sheet events
There have been no significant events subsequent to 31 December 2007 and up to
the date of this report that would require adjustment.
Earnings per share
The difference between the total number of shares in issue (fully diluted) and
the weighted average number of shares in issue relates to treasury shares, which
are held by the share trusts for share options granted to employees that are
exercisable in the future, and to shares issued pursuant to the listing on the
Altx during the current period.
Dividend
The Group only declares a final dividend once a year after year end.
Change in year end going forward
The Group has changed its financial year end from 30 June to the last day of
February. The Group will thus publish audited results for the 8 months ended 29
February 2008.
Registered office
Corner of Iscor and Solingen Streets
Northern Industrial Area, Windhoek
(PO Box 98, Windhoek, Namibia)
Registered as an external company in the Republic of South Africa
Tuscany Office Park, Block 5
Coombe Place
Rivonia
(PO Box 3581, Rivonia, 2128)
Tel: 011 8070109
Fax: 011 8071316
Transfer Secretaries
Computershare Investor Services (Pty) Limited
70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Designated advisor
BDO Questco (Pty) Limited
Corporate advisor
PSG Capital (Pty) Limited
Directorate
BH Kent (Chairman)*, TP Rogers (Chief Executive Officer), EHT Angula*#,
FW Britz, H-B Gerdes *#, JA Holtzhausen*, P Malan*
* - Non-executive, # - Namibian Citizen
Company Secretary
JFB Smit
Business address
Tuscany Office Park, Block 5
Coombe Place, Rivonia
Date: 29/02/2008 15:12:01 Produced by the JSE SENS Department.
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