| Tue 4 Mar 2008, 17:30 | | LBH - Liberty Holdings - Audited Results For The Y |
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LBH
LBH
LBH - Liberty Holdings - Audited Results For The Year Ended 31 December 2007
Liberty Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1968/002095/06)
Alpha code LBH
ISIN code ZAE000004032
("Liberty Holdings")
AUDITED RESULTS FOR THE YEAR ENDED 31 December 2007
Commentary on results
Liberty Holdings is the holding company of Liberty Group Limited. Liberty
Holdings carries on no business other than that related to its investment in
Liberty Group Limited. At 31 December 2007 Liberty Holdings held an effective
51,2% interest in Liberty Group Limited (31 December 2006: 52,0%).
Shareholders are consequently referred to the announcement published by
Liberty Group Limited on 28 February 2008 (available at www.liberty.co.za),
for further details and a review of their operations and prospects, the
results of which are consolidated into Liberty Holdings.
On 17 September 2007 Liberty Group Limited paid a capital reduction of R1,44
per share. The proceeds received were R209 million. Consequently a dividend of
R190 million (387 cents per share) was declared on 22 November 2007 and paid
on 18 December 2007. Secondary tax on companies amounted to R19 million.
Non-related party shareholders of the company`s subsidiary Liberty Group
Limited on the 29 January 2007 approved the acquisition of the remaining
ordinary shares in STANLIB Limited for a consideration in the order of R1,6
billion.
Final Cash Dividend
On 28 February 2008 Liberty Group Limited announced the declaration of a
capital reduction of 266 cents per ordinary share in lieu of an ordinary
dividend, subject to the approval of the Financial Services Board. The total
proceeds receivable by the company from Liberty Group Limited are R386
million. After secondary tax on companies of R35 million, the net amount
available for distribution is R351 million.
Until such time that the Liberty Group Limited capital reduction is approved
by the Financial Services Board, the board has deferred the declaration of a
final cash dividend in respect of the financial year ended 31 December 2007.
Accounting policies and presentation
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS) and International Accounting Standard 34,
consistent with the accounting policies applied for the year ended 31 December
2006, except for the following changes in accounting policies 1)business
combinations involving businesses under common control, 2)measurement of
investment guarantees to a market consistent basis 3)changes to liability
valuation models used for certain insurance products. In addition the Group
adopted IFRS 7: Financial Instruments: Disclosures. The only change in policy
that required restatement was business combinations under common control. The
resultant prior year restatements to the group`s assets, liabilities and
equity can be found in the addendum attached.
Derek Cooper
Chairman
4 March 2008
Audit opinion
The auditors, PricewaterhouseCoopers Inc., have issued their opinion on the
Group_fs financial statements for the year ended 31 December 2007. They have
issued an unmodified audit opinion. A copy of their audit report is available
for inspection at the company_fs registered office.
Liberty Holdings Limited (the Company)
Incorporated in the Republic of South Africa
Registration number: 1968/002095/06)
Alpha code: LBH
ISIN code: ZAE000004032
Transfer Secretaries
Computershare Investor Services 2004 (Pty) Limited
(Registration number: 2004/003647/07)
Ground Floor, 70 Marshall Street, Johannesburg 2001
PO Box 61051, Marshalltown, 2107
Telephone +27 11 370 5000
Sponsor
Merrill Lynch
Global Markets & Investment Banking Group
Merrill Lynch South Africa (Pty) Ltd
Registration number 1995/001805/07
Registered Sponsor and Member of the JSE Limited
These results are available at www.libertyholdings.co.za
Condensed group balance sheet
as at 31 December 2007
As restated
2007 2006
Audited Rm Rm
Assets
Investments 209 417 188 691
Intangible assets 1 137 1 331
Reinsurance assets 820 1 065
Deferred taxation 51 40
Prepayments, insurance and other receivables 3 528 3 189
Cash and cash equivalents 4 688 5 242
Other assets 1 006 872
Total assets 220 647 200 430
Liabilities
Policyholders` liabilities 186 137 168 898
Financial liabilities 2 484 2 357
Third party liabilities arising on
consolidation of mutual funds 8 040 8 559
Deferred taxation 3 484 3 262
Insurance and other payables 5 993 4 247
Other liabilities 2 018 1 186
Total liabilities 208 156 188 509
Equity
Ordinary shareholders` funds 5 288 5 247
Minority interests 7 203 6 674
Total equity 12 491 11 921
Total equity and liabilities 220 647 200 430
Condensed group income statement
for the year ended 31 December 2007
As restated
2007 2006
Audited Rm Rm
Total revenue 50 173 59 180
Net insurance benefits and claims (30 683) (38 140)
Fair value adjustment to policyholder
liabilities under
investment contracts (6 281) (8 276)
Fair value adjustment on third party
mutual fund liabilities (189) (1 480)
Acquisition costs associated with insurance
and investment contracts (2 894) (2 413)
Expenses (4 689) (3 903)
Preference dividend in subsidiaries (274) (184)
Profit on sale of subsidiaries 6 374
Equity accounted earnings from joint ventures 51 150
Defined benefit pension fund employer surplus 162
Profit before taxation 5 382 5 308
Taxation (2 105) (2 307)
Total earnings 3 277 3 001
Attributable to:
Equity holders 1 463 1 386
Minority interest 1 814 1 615
3 277 3 001
Weighted average number of shares in issue 46 319 000 46 608 000
Earnings per share Cents Cents
Basic earnings 3 155,3 2 968,9
Fully diluted 3 155,3 2 968,0
Headline earnings
for the year ended 31 December 2007
Rm Rm
Reconciliation of headline earnings
Total earnings attributable to equity holders 1 463 1 386
(Profit)/loss on sale of subsidiaries (3) (194)
Headline earnings 1 460 1 192
Headline earnings per share Cents Cents
Basic earnings 3 149,0 2 552,2
Fully diluted 3 149,0 2 552,1
Condensed statement of changes in group ordinary shareholders` funds for the
year ended 31 December 2007
As restated
2007 2006
Audited Rm Rm
Balance at 1 January 5 247 4 658
Total earnings 1 463 1 386
Excess purchase price over net asset value of
STANLIB (1 148)
Ordinary dividends (503) (959)
Preference dividend (2) (2)
Treasury shares (269) (5)
Subscriptions for shares 1
Black Economic Empowerment transaction 49 95
Share based payments 28 26
Owner-occupied properties - net fair value
adjustments 44 18
Foreign currency translation movement on
subsidiaries 9 25
Change in effective ownership 370 4
Ordinary shareholders` funds 5 288 5 247
Minority interests 7 203 6 674
Total shareholders` funds at 31 December 12 491 11 921
Condensed group cash flow statement for the year ended 31 December 2007
As restated
2007 2006
Audited Rm Rm
Cash generated from /(utilised in)
Operating activities 7 989 4 578
Investing activities (7 711) (11 398)
Financing activities (957) (393)
Net decrease in cash and cash equivalents (679) (7 213)
Cash and cash equivalents at beginning of year 5 242 12 455
Net cash acquired on business acquisition
and disposals 125
Cash and cash equivalents at end of year 4 688 5 242
Condensed segment results
for the year ended 31 December 2007
Audited
Insurance Other
Asset Share-
manage- holder
Group Individual ment operations Total
2007 Rm Rm Rm Rm Rm
Segment revenue 8 581 38 468 1 417 1 707 50 173
Segment expenses (8 261) (34 918) (666) (499) (44 344)
Segment result 320 3 550 751 1 208 5 829
Profit before 318 3 259 627 1 178 5 382
taxation
Taxation (89) (1 690) (205) (121) (2 105)
Total earnings 229 1 569 422 1 057 3 277
2006
Segment revenue 9 206 46 369 123 3 482 59 180
Segment expenses (8 807) (43 246) (3) (1 941) (53 997)
Segment result 399 3 123 120 1 541 5 183
Profit before 397 2 978 221 1 712 5 308
taxation
Taxation (150) (1 830) (25) (302) (2 307)
Total earnings 247 1 148 196 1 410 3 001
Commitments summary
as at 31 December 2007
As restated
2007 2006
Audited Rm Rm
Operating leases - properties and equipment 700 632
Within 1 year 137 95
1 to 5 years 563 374
6 to 10 years 163
Capital commitments 1 090 1 987
Business acquisitions 386 1 575
Investment and owner-occupied property 488 311
Equipment 216 101
The above 2007 expenditure will be financed by available bank facilities,
existing cash resources, internally generated funds and from minorities in
unincorporated property partnerships.
Related parties
as at 31 December 2007
There have been no significant changes to the nature of the related
party transactions as described in note 42 to the 31 December 2006 annual
financial statements.
Summary of movement in investments in ordinary shares held by the group and
its subsidiaries in the group`s ultimate holding company is as follows:
Market
Number value Ownership
`000 Rm %
Standard Bank Group Limited
Balance at 31 December 2006 38 588 3 647 2,83
Purchases 10 123 1 092
Sales (7 529) (785)
Fair value adjustments 168
Balance at 31 December 2007 41 182 4 122 3,00
Retirement benefit obligations
As at 31 December 2007, the Liberty Group post retirement medical aid benefit
liability was R293 million (2006: R261 million).
The apportionment of the surplus within the Liberty Pension Fund between the
employer and the members was approved on 31 August 2007 by the Registrar of
Pension Funds in terms of the Pension Fund Second Amendment Act, 39 of 2001.
The employer surplus of R162 million has been measured as the approved amount
allocated at 1 January 2003 (date of apportionment) adjusted for subsequent
related net investment gains to 31 December 2007. The amount will be recovered
through future reductions in employer contributions to the plan.
Addendum - Restatement of comparatives
Condensed group balance sheet for the year ended 31 December 2006
Date: 04/03/2008 17:30:28 Produced by the JSE SENS Department.
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