| Fri 28 Mar 2008, 13:17 | | KDV - Kaydav Group - Audited results for the four months ended 31 December 2007 |
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KDV
KDV
KDV - Kaydav Group - Audited results for the four months ended 31 December 2007
KAYDAV GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration number 2006/038698/06)
JSE code: KDV ISIN: ZAE000108940
("KayDav" or "the company")
AUDITED RESULTS FOR THE FOUR MONTHS ENDED 31 DECEMBER 2007
Highlights:
- Acquisition of the Kayreed business effective 1 September 2007
- Acquisition of Davidsons Holdings Company (Pty) Ltd and its subsidiaries
effective 1 November 2007
- Successful private placement of shares raising R40 million and listing on
the main board of the JSE on 15 November 2007
CONSOLIDATED INCOME STATEMENT
R
Revenue 103 765 910
Cost of sales (71 574 673)
Gross profit 32 191 237
Other income 274 523
Operating expenses (22 690 325)
Share-based payments (4 000 000)
Operating profit 5 775 435
Investment income 509 764
Finance costs (729 696)
Profit before taxation 5 555 503
Taxation (2 777 809)
Profits attributable to equity holders of the parent 2 777 694
Reconciliation between earnings and headline earnings
Earnings attributable to equity holders 2 777 694
Loss on sale of property, plant and equipment (after tax) 295 209
Profit on sale of property, plant and equipment (after tax) (25 030)
Headline earnings attributable to equity holders 3 047 873
Weighted average number of shares in issue 220 363 402
Shares in issue at period-end 295 232 716
Basic earnings per share (cents) 1.3
Headline earnings per share (cents) 1.4
Consolidated Balance Sheet
R
ASSETS
Non-current assets 158 022 108
Plant and equipment 23 272 633
Goodwill 133 535 994
Deferred taxation 1 213 481
Current assets 148 532 784
Inventories 70 017 758
Trade and other receivables 60 341 937
Cash and cash equivalents 16 127 753
Taxation 2 045 336
TOTAL ASSETS 306 554 892
EQUITY AND LIABILITIES
Capital and reserves 236 255 541
Share capital 295
Share premium 229 477 552
Retained earnings 6 777 694
Non-current liabilities 6 136 472
Instalment sale liabilities 5 231 478
Deferred taxation 904 994
Current liabilities 64 162 879
Trade and other payables 38 375 885
Current portion of instalment sale liabilities 4 447 659
Bank overdraft 13 303 603
Taxation 6 756 872
Provisions 1 278 860
TOTAL EQUITY AND LIABILITIES 306 554 892
Shares in issue at period-end 295 232 716
Net asset value per share (cents) 80.0
Consolidated Cash Flow Statement
R
Cash flows from operating activities
Operating cash before working capital movements 10 708 338
Working capital movements (12 041 975)
Cash absorbed by operations (1 333 637)
Interest received 509 764
Interest paid (729 696)
Taxation paid (1 667 125)
Net cash used in operating activities (3 220 694)
Cash flows from investing activities
Investment in property, plant and equipment to
maintain operations (1 004 223)
Proceeds on disposal of property, plant and equipment 4 827 029
Investment in subsidiaries and businesses (114 836 010)
Net cash used in investing activities (111 013 204)
Cash flows from financing activities
Proceeds from shares issued (net of costs) 119 639 219
Decrease in long-term borrowings (2 581 171)
Net cash from financing activities 117 058 048
Net cash and cash equivalents at the end of the period 2 824 150
Consolidated Statement of Changes in Equity
Share Share Total share
capital premium capital
R R R
Issue of shares 295 233 857 522 233 857 817
Listing expenses - (4 379 970) (4 379 970)
Profit for the period - - -
Share-based payments - - -
Balance at 31 December 2007 295 229 477 552 229 477 847
Retained Total
earnings equity
R R
Issue of shares - 233 857 817
Listing expenses - (4 379 970)
Profit for the period 2 777 694 2 777 694
Share-based payments 4 000 000 4 000 000
Balance at 31 December 2007 6 777 694 236 255 541
COMMENTARY
Introduction
The directors are pleased to announce the financial results of KayDav Group Ltd
and its subsidiaries ("KayDav") for the four months ended 31 December 2007.
Significant milestones achieved during the reporting period were:
- the acquisition of the business of Kayreed Trading effective 1 September
2007.
- the acquisition of the entire share capital of Davidsons Holding Company
(Pty) Ltd effective 1 November 2007.
- the private placement of shares raising R40 million and listing on the main
board of the JSE on 15 November 2007.
Financial results
The results reported includes four months of the Kayreed business and two months
of the Davidsons Holding Company group.
The group exceeded its forecasted profit attributable to equity holders as set
out in the prospectus. Basic earnings per share of 1.3 cents and headline
earnings of 1.4 cents per share compare favourably with forecasted basic and
headline earnings per share of 0.68 cents. This was achieved by better than
expected performance on the revenue line.
The tax rate of 50% resulted from the inclusion in profit before taxation of
share-based payments of R4 million which are non-deductible for taxation
purposes.
If the acquisitions had been effective from the beginning of the financial year
the combined revenue for the group would have been R422 million, the combined
earnings R28 million, basic earnings per share 9.5 cents and headline earnings
per share 9.6 cents (based on management accounts and including the share-based
payments of R4 million included in the income statement).
Acquisition of Kayreed business
The Kayreed business was acquired for cash for a purchase consideration of R106
808 630.
The value of the net assets acquired amounted to R48 694 976. Goodwill of R58
113 654 was recognised at acquisition date. The identifiable intangible assets
will be fair valued in terms of IFRS 3 during the next reporting period.
Acquisition of the Davidsons Holding Company group
The entire share capital of Davidson`s Holding Company (Pty) Ltd was acquired
for a purchase price of R109 838 628.
The purchase price was settled by the issue of 109 838 628 shares issued at
R1.00 each.
At acquisition the net asset value of Davidsons Holding Company and its
subsidiaries amounted to R34 416 288. Goodwill of R75 422 340 was recognised at
acquisition. The identifiable intangible assets will be fair valued in terms of
IFRS 3 during the next reporting period.
Segment reporting
No segment report is presented as this is a single segment group.
Prospects
We are faced with a general slowdown in economic growth and while our industry
is not insulated from these effects, as a group we look towards entering new
geographical areas to provide significant earnings growth. Management is at an
advanced stage of investigating these opportunities for expansion.
We are comfortable that the group is on course to achieve earnings to the order
of those forecasted in our prospectus.
Dividends
No dividends were declared during the current period.
Changes to capital structure
Pre-listing the company subdivided each share of R1.00 to 1 000 000 shares of
R0.000001 each.
A pre-listing shareholder loan was converted to share capital resulting in the
issue of 45 494 088 shares at a premium of R1.849 per share. As settlement for
the Davidsons Holding Company acquisition 109 838 628 shares were issued at a
premium of R0.999999 per share.
On listing 40 000 000 shares were privately placed at a premium of R0.999999 per
share.
Basis of preparation
The annual financial statements have been prepared in accordance with
International Financial Reporting Standards, the requirements of IAS 34 and in
compliance with the JSE Listings Requirements and the Companies Act of South
Africa, 1973.
The consolidated financial statements have been audited by our auditors PKF
(Jhb) Incorporated whose unqualified audit report is available for inspection at
the company`s registered office.
Appreciation
The board extends its appreciation to our management and staff for their efforts
during this reporting period. We look forward to future achievements together.
On behalf of the board
I H Stern G F Davidson
Chairman Chief Executive Officer 28 March 2008
Corporate information
Executive Directors: G F Davidson (CEO), G Davidson, M Slier (CFO), J Katz
Non-executive Directors: I H Stern (Chairman), J Hertz
Registration Number: 2006/038698/06
Registered Address: 3rd Floor, JHI House, 11 Cradock Avenue, Rosebank, 2196
Postal Address: PO Box 272 Ottery 7808
Telephone: 021 704 7060 Facsimile: 021 704 2082
Company Secretary: Probity Business Services (Pty) Ltd
Transfer Secretaries: Link Market Services South Africa (Pty) Ltd
Auditors: PKF (Jhb) Incorporated
Sponsor: Java Capital (Proprietary) Limited
Date: 28/03/2008 13:17:50 Produced by the JSE SENS Department.
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