|
PHM
PHM
PHM - Phumelela Gaming And Leisure - The Group`s unaudited condensed
consolidated interim financial statements for the six months ended 31
January 2008 and dividend declaration
Phumelela Gaming & Leisure Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/016610/06)
Share code: PHM & ISIN: ZAE000039269
The Group`s unaudited condensed consolidated interim financial statements
for the six months ended 31 January 2008
- HEADLINE EARNINGS FROM CONTINUING OPERATIONS UP 25%
- HEPS FROM CONTINUING OPERATIONS UP 22% - DISTRIBUTION TO SHAREHOLDERS
UP 25%CONDENSED CONSOLIDATED INCOME STATEMENTS
% Unaudited Unaudited Audited
change 6 months 6 months 12 months
31 Jan 31 Jan 31 Jul
2008 2007 2007
R`000 R`000 R`000
Net revenue 17 1 341 852 1 142 217 2 377 031
Net betting income
- local operations 265 104 237 307 488 284
- international 6 467 1 307 5 118
operations
14 271 571 238 614 493 402
Other operating income
- local operations
Continuing operations 69 142 58 704 117 861
Compensation for early 36 300 35 573
termination of Newmarket
lease
Proceeds on 40 000 40 000
termination
Impairment of (3 700) (4 427)
Newmarket night racing
lights and immovable
assets
Surplus on disposal of 27 814
Bloemfontein Racecourse
- international 34 821 32 002 66 640
operations
Net income 403 348 365 620 713 476
Operating expenses and
overheads
- stakes 71 082 65 716 132 701
- local operations 211 279 190 478 384 322
- international 30 256 22 036 50 409
operations
Profit from operations 90 731 87 390 146 044
Finance costs 26 371 471
Profit before share of 90 705 87 019 145 573
profit of associated
company
Share of profit of 1 269 1 647 2 805
associated company
Profit before income tax 91 974 88 666 148 378
Income tax 27 006 24 178 39 436
Profit for the period 64 968 64 488 108 942
Attributable to:
- Equity holders of the 64 968 64 488 108 942
parent
Earnings per share
(cents)
- Basic 85,26 86,53 145,33
- Diluted 84,83 84,28 143,36
SUPPLEMENTARY INCOME
STATEMENT INFORMATION
Reconciliation of
headline earnings
Earnings attributable to
equity holders
- derived from continuing 25 41 183 32 915 77 991
operating activities
- compensation for early 31 573 30 951
termination of Newmarket
lease after tax
- surplus on disposal of 23 785
Bloemfontein Racecourse
after tax
64 968 64 488 108 942
Adjusted for:
Net (surplus)/loss on (23 520) 273 430
disposal of property,
plant and equipment after
tax
Impairment of Newmarket 2 627 3 249
night racing lights and
immovable assets after
tax
Headline earnings (38) 41 448 67 388 112 621
Adjusted for:
Compensation for early (34 200) (34 200)
termination of Newmarket
lease and impairment of
night racing lights and
immovable assets after
tax
Headline earnings from 25 41 448 33 188 78 421
continuing operating
activities
Headline earnings per (40) 54,40 90,42 150,24
share (cents)
Diluted headline earnings (39) 54,12 88,07 148,20
per share (cents)
Headline earnings per 22 54,40 44,53 104,62
share from continuing
operating activities
(cents)
Diluted headline earnings 25 54,12 43,37 103,19
per share from continuing
operating activities
(cents)
Net asset value per share 23 434,55 353,04 390,45
(cents)
Interim dividend/ 25 25,00 20,00 20,00
distribution
Dividend per ordinary 25,00 14,00 14,00
share (cents)
Distribution out of share - 6,00 6,00
premium (cents)
Final dividend
Dividend per ordinary 40,00
share (cents)
Number of shares in issue 76 653 585 74 998 135 75 765 285
Weighted average number 76 197 360 74 529 825 74 961 502
of shares in issue for
basic and headline
earnings per share
calculation
Weighted average number 76 585 455 76 515 006 75 993 693
of shares in issue for
diluted earnings per
share calculation
CONDENSED CONSOLIDATED CASH FLOW STATEMENTS
Unaudited Unaudited Audited
6 months 6 months 12 months
31 Jan 31 Jan 31 Jul
2008 2007 2007
R`000 R`000 R`000
Cash generated by operations 64 944 99 270 156 213
(Increase)/decrease in working (14 356) (5 236) 27 088
capital
Cash generated by operating 50 588 94 034 183 301
activities
Net finance costs, investment (26 434) (22 611) (27 094)
income and taxation paid
Post retirement benefit asset 79
funding
Dividends paid (30 561) (22 411) (32 975)
Net cash (outflow)/inflow from (6 407) 49 091 123 232
operating activities
Net cash outflow from investing (11 185) (12 392) (53 682)
activities
Net cash inflow from financing 2 843 2 925 4 591
activities before capital
distribution
Capital distribution (4 527)
Net (decrease)/increase in cash (14 749) 39 624 69 614
and cash equivalents
Cash and cash equivalents at 139 116 69 502 69 502
beginning of period
Cash and cash equivalents at end 124 367 109 126 139 116
of period
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited Unaudited Audited
31 Jan 31 Jan 31 Jul
2008 2007 2007
R`000 R`000 R`000
ASSETS
Non-current assets 276 728 207 151 236 302
Property, plant and equipment 253 389 188 415 223 176
Deferred taxation 5 247
Goodwill 3 312 3 312 3 312
Intangible asset 5 957
Interest in associated companies 14 010 9 097 9 044
Investments 770 370 770
Current assets 179 171 157 605 188 984
Inventories 3 598 255 956
Trade and other receivables 51 206 44 039 44 727
Cash and cash equivalents 124 367 109 126 139 116
Assets classified as held for sale 4 185 4 185
Total assets 455 899 364 756 425 286
EQUITY AND LIABILITIES
Total equity 333 096 264 774 295 829
Share capital and premium 6 181 6 199 3 338
Retained earnings 326 721 258 423 292 314
Non-distributable reserves 194 152 177
Non-current liabilities 5 913 6 848 5 913
Deferred taxation 3 645 4 720 3 645
Retirement benefit obligations 2 268 2 128 2 268
Current liabilities 116 890 93 134 123 544
Trade and other payables 98 995 71 412 105 125
Income tax payable 17 895 11 939 18 419
Short-term financial liability 9 783
Total equity and liabilities 455 899 364 756 425 286
CONDENSED STATEMENT OF CHANGES IN GROUP EQUITY
Non-
Distri-
Share Share butable Retained Total
capital premium reserves earnings Equity
R`000 R`000 R`000 R`000 R`000
Balance at 31 1 848 1 426 52 216 250 219 576
July 2006
Issue of share 46 4 545 - - 4 591
capital -
options
exercised
Total recognised - - 125 108 942 109 067
income and
expense for the
year
- Profit for the - - - 108 942 108 942
year
- Foreign - - 125 - 125
currency
translation
reserve - Isle
of Man Tote
Limited
Share based - - - 97 97
payment
Distributions - (4 527) - (32 975) (37 502)
paid to equity
holders
Balance at 31 1 894 1 444 177 292 314 295 829
July 2007
Issue of share 22 2 821 - - 2 843
capital -
options
exercised
Total recognised - - 17 64 968 64 985
income and
expense for the
period
- Profit for the - - - 64 968 64 968
period
- Foreign - - 17 - 17
currency
translation
reserve - Isle
of Man Tote
Limited
Dividends paid - - - (30 561) (30 561)
to equity
holders
Balance at 31 1 916 4 265 194 326 721 333 096
January 2008
BASIS OF PRESENTATION
The interim financial results have been prepared and presented in accordance
with International Financial Reporting Standards and the Companies Act 1973. The
presentation and disclosure requirements of IAS 34: Interim Reporting has been
complied with in this announcement.ACCOUNTING POLICIES
The accounting policies used in preparing the interim financial statements are
consistent with those used in the annual financial statements for the year ended
31 July 2007.
Certain comparative amounts have been reclassified in order to make comparative
information more meaningful.
REVIEW OF RESULTS
Headline earnings from continuing operations (excluding the surplus of R27,8
million on disposal of Bloemfontein Racecourse in the current period and the
R36,3 million compensation for early termination of the Newmarket lease in the
comparative period) increased by 25% toR41,4 million (2007: R33,2 million),
attributable mainly to the satisfactory growth in revenues earned for the period
and the containment of manageable operating expenses. HEPS from continuing
operations increased by 22% to 54,40 cents per share.
Revenue for the six months increased by 17% on the comparative period with local
revenue up 12% and international revenue up 153%, the Isle of Man Tote operation
now beginning to show its potential with revenue growth of 462% on the
comparative period. The increased revenues flowed to net betting income that was
up 14% on the comparative period.
Operating expenses increased by 12% on the comparative period with local
operations (inclusive of stakes) up 10% reflecting the Group`s on-going
investment in upgrading and expanding the local retail outlet network and
betting technology. International operations increased by 37% mainly
attributable to the continued investment in additional resources and capital
infrastructure to meet the increased demand for international products and
services and to progress further international opportunities.
Profit from continuing operations before tax, finance costs and share of profit
of associated company increased by 23% on the comparative period to R62,9
million (2007: R51,1 million) with local operations up by 30% and international
operations down 2%, the 24% increase in international income utilised by a 37%
increase in international operating costs that were affected by the Isle of Man
Tote operation and the RUK earn-out of approximately R5 million in the
comparative period.
FINANCIAL POSITION
The financial position of the Group which is set out in the balance sheet shows
total assets of R455,9 million (2007: R364,8 million) including cash balances of
R124,4 million (2007: R109,1 million) adequately covering total liabilities of
R122,8 million (2007: R100,0 million).
Cash and cash equivalents decreased by R14,7 million during the six months to
R124,4 million at 31 January 2008. Cash generated by operations of R64,9 million
was utilised to fund an increase in working capital of R14,4 million
(attributable mainly to an increase in international operations trade
receivables and a decrease in trade and other payables), and pay taxation of
R32,8 million and dividends of R30,6 million. The R32,0 million received on
disposal of Bloemfontein Racecourse was reinvested in capital expenditure of
R39,7 million.
ACQUISITION
In December 2007 Phumelela Gold Enterprises, a jointly controlled operation
between Phumelela and Gold Circle, acquired an indirect shareholding of 20% of
the issued capital in Automatic Systems Limited (ASL), a company listed on the
Mauritius Stock Exchange, for R5,7 million. ASL is one of two companies licensed
to operate a totalisator on the island.
CONDENSED CONSOLIDATED SEGMENTAL ANALYSIS
The Group stages and broadcasts horseracing events and offers betting
opportunities on both South African and international product in two geographic
segments, namely South Africa and the rest of the world.
Unaudited Unaudited Audited
31 Jan 31 Jan 31 Jul
2008 2007 2007
R`000 R`000 R`000
LOCAL
Net revenue 1 227 327 1 096 980 2 259 527
Net income 334 246 296 011 606 145
Stakes 71 082 65 716 132 701
Other net operating expenses 211 279 190 478 384 322
Profit from continuing 51 885 39 817 89 122
operations
Compensation for early 36 300 35 573
termination of Newmarket lease
Surplus on disposal of 27 814
Bloemfontein Racecourse
Profit from operations 79 699 76 117 124 695
Assets 418 840 330 985 398 984
Liabilities 104 823 82 051 119 645
INTERNATIONAL
Net revenue 114 525 45 237 117 504
Net income 41 288 33 309 71 758
Net operating expenses 30 256 22 036 50 409
Profit from operations 11 032 11 273 21 349
Assets 37 059 33 771 26 302
Liabilities 17 980 17 931 9 812
TOTAL
Net revenue 1 341 852 1 142 217 2 377 031
Profit from continuing 62 917 51 090 110 471
operations
Compensation for early 36 300 35 573
termination of Newmarket lease
Surplus on disposal of 27 814
Bloemfontein Racecourse
Profit from operations 90 731 87 390 146 044
Assets 455 899 364 756 425 286
Liabilities 122 803 99 982 129 457
CAPITAL COMMITMENTS
Commitments in respect of capital expenditure approved by directors.
2008 2007
R`000 R`000
Contracted for 44 858* 40 800*
Not contracted for 115 862^ 17 400
* Includes R30 million (2007: R35 million) for illumination of the Turffontein
race tracks for night racing.
^ Includes R50 million for the improvement of the Arlington Estate in Port
Elizabeth.
POST BALANCE SHEET EVENTS
There are no significant post balance sheet events that have a material impact
on the financial statements at 31 January 2008.
In the budget speech delivered on 20 February 2008, the South African Minister
of Finance announced a reduction in the company tax rate from 29% to 28%,
effective for years of assessment ending on or after 1 April 2008. At the
reporting date, the tax rate reduction was not substantively enacted and the
current rate of 29% has accordingly been applied. The non-adjusting financial
effect of the tax rate reduction on deferred tax at the reporting date is
immaterial.
The appeal lodged against the Gauteng Department of Agriculture, Conservation
and Environment`s decision to authorise the installation of light masts and
lamps for night racing at Turffontein Racecourse was dismissed by the Gauteng
MEC on 11 March 2008. Construction of the lights is planned to commence within
the four months ending 31 July 2008.
SOCIAL RESPONSIBILITY
Phumelela recognises that it has a responsibility to the broader community to
act in a socially responsible manner, for the benefit of all South Africans.
Contributions to selected training, sports and community service related
projects continue. The Group has adopted appropriate BEE and employment equity,
training and procurement policies.
LITIGATION
The Company`s legal action instituted against its insurance underwriters in
respect of the business interruption claim arising from the loss of profits
caused by the equine flu is currently in arbitration following the Court`s
inability to hear the case on the trial date previously set for 31 October 2007.
The arbitrator`s decision is expected in May 2008.
No income accrual has been recognised by the Company to date.
DIRECTORS
Mr B D Mehl retired as a Director and Deputy Chairman of the Company on 2
October 2007. His invaluable contribution, first as CEO and then as Director and
Deputy Chairman of the Company is acknowledged by the Board.
PROSPECTS
Local trading conditions are expected to be tougher following the challenges the
economy has to face. However, provided the macro-economic conditions do not
deteriorate further, management expects real earnings growth in the six months
ending 31 July 2008 and remains confident of the long-term outlook for local and
international operations.
DIVIDEND TO SHAREHOLDERS
Notice is hereby given that the Board has declared an interim dividend of 25
cents per share payable to shareholders recorded in the register on Friday 25
April 2008. Shareholders are advised that the last date to trade "cum dividend"
will be Friday 18 April 2008. As from commencement of business on Monday 21
April 2008 all trading in Phumelela shares will be "ex dividend". Payment will
be made on Tuesday 29 April 2008. Share certificates may not be dematerialised
or rematerialised between Monday 21 April 2008 and Friday 25 April 2008, both
days inclusive.
For and on behalf of the Board
M P MALUNGANI J S TENNANT
Chairman Chief Executive
Johannesburg
2 April 2008
Directors: : M P Malungani (Chairman), JS Tennant* (Chief Executive),
S E Abrahams, D R H Attenborough*, M J Jooste, B Kantor, S K C Khampepe, N J
Mboweni (Mrs), Dr E Nkosi, M L Ramafalo*, C J H Van Niekerk, J B Walters
(*Executive)
Company Secretary: A F Wintour
Registered Office: Turffontein Racecourse, 14 Turf Club Street, Turffontein
Transfer Secretaries: Computershare Investor Services (Pty) Ltd
Sponsor: Investec Bank Limited
Web site: www.phumelela.com
Date: 02/04/2008 14:33:51 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
| Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information. | |||||||||||||
| Other Profile Group sites: FundsData Online (unit trust data) | Profile Group corporate site | |||||||||||||
| [ Terms of Use | Privacy Policy | PAIA manual | FAQs/Help | Site Map | © Copyright Reserved 2026 ] | |||||||||||||
|
|||||||||||||
