| Thu 29 May 2008, 17:30 | | BDM - Buildmax - Reviewed Consolidated Financial Results For The 11 Months |
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BDM
BDM
BDM - Buildmax - Reviewed Consolidated Financial Results For The 11 Months
Ended 29 February 2008
Buildmax Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1995/012209/06)
Share code BDM & ISIN ZAE000011250
("Buildmax" or "the group")
REVIEWED CONSOLIDATED FINANCIAL RESULTS FOR THE 11 MONTHS ENDED 29 FEBRUARY 2008
POST BALANCE SHEET EVENTS AND PROSPECTS
The reviewed condensed consolidated financial results for the 11 month period
ended 29 February 2008 ("the review period"), prior to conclusion of the
acquisitions of Diesel Power Open Cast Mining (Pty) Limited and the Buildco
group of companies ("the acquisitions"), are presented below. In light of the
complete repositioning of Buildmax following the acquisitions, the results for
the review period do not reflect the current activities of the group or expected
performance levels and prospects. The results for the review period therefore do
not provide a meaningful basis for assessment of Buildmax and have been
presented to comply with the requirements of the JSE Limited.
The abridged forecast income statements for the year ending 28 February 2009,
set out in the Revised Listings Particulars dated 5 March 2008 ("the RLPs") and
duplicated below, provide an accurate reflection of the activities and expected
performance of the new Buildmax group post the acquisitions.
Following a successful capital raising the acquisitions became effective post
the review period. Buildmax is now a diversified supplier of opencast mining
services and bulk earthworks as well as construction materials to the mining and
construction industries. The group comprises two key business units: Equipment &
Services and Construction Materials.
Equipment & Services encompasses Diesel Power, one of the largest opencast
mining and earthmoving contractors in the country, and Vukuza Earth Works which
together are approved and registered contractors to all major coal mining and
construction groups in South Africa. The business unit has a fleet of over 700
mining and earthmoving vehicles.
Construction Materials quarries, manufactures and distributes a range of
materials to the construction industry through a number of well established
businesses with track records between 20 and 70 years.
Prospects
Buildmax is well-positioned to capitalise on high-growth mining activity,
particularly in the coal mining industry, as well as on opportunities created by
ongoing investment in infrastructure.
In particular the redressing of South Africa`s historic underinvestment in power
generation offers sustainable growth opportunity over the long term. Eskom`s
immediate demand for coal reserves to meet existing requirements and cope with
increased demand from re-commissioning of mothballed power stations, will
continue to drive local activity. In addition a number of new power stations
will be built over the next 20 years, the majority of which will be coal fired.
These factors and the continued high level of demand for coal and commodities
globally will drive growth in coal and other mining activities. However, the
shortage of equipment remains a constraint to growth in both large mining and
construction groups. As a leading purchaser of equipment in South Africa for the
past 20 years with a large and well maintained fleet and highly skilled team,
the group is ideally positioned to take advantage of this growth opportunity.
The enlarged Construction Materials business unit is set to benefit from
government and private sector infrastructure spend.
Abridged forecast income statements
Consolidated Equipment % of Construction % of total
forecast & total Materials
year ending Services year ending
28 Feb 2009 year 28 Feb 2009
ending 28
Feb 2009
Reviewed Reviewed Reviewed
R`000 R`000 R`000
Revenue 1 703 473 977 995 57 725 478 43
Earnings before 491 494 352 908 72 138 586 28
interest,
taxation,
depreciation
and
amortisation
Depreciation (118 485) (102 701) (15 784)
Net interest (94 325) (90 477) (3 848)
expense
Profit before 278 684 159 730 57 118 954 43
taxation
Taxation (78 032) (44 724) (33 308)
Profit after 200 652 115 006 57 85 646 43
taxation
Attributable
to:
Equity holders 200 152 115 006 85 146
of the holding
company
Minority 500 - 500
interest
200 652 115 006 85 646
Basic earnings 22,5
per share
(cents)
Headline 22,5
earnings per
share (cents)
Note: The Abridged Forecast Income Statements are based on assumptions set out
in the RLPs and should be read in conjunction with the RLPs
REVIEWED CONDENSED CONSOLIDATED FINANCIAL RESULTS FOR THE 11 MONTHS ENDED 29
FEBRUARY 2008 PRIOR TO CONCLUSION OF THE ACQUISITIONS
Basis of preparation
The reviewed condensed consolidated financial results have been prepared in
accordance with International Financial Reporting Standards ("IFRS"), IAS 34 and
the South African Companies Act. The accounting policies applied in preparing
these reviewed condensed consolidated financial results are consistent in all
respects with those applied in the audited annual financial statements at the
previous year-end.
Certain comparative balances have been reclassified and adjusted for the effect
of a prior period error, as explained in the notes to the reviewed condensed
consolidated financial results.
There are no separate segments for the review period and therefore no segmental
analysis is provided.
Effective 29 February 2008, Buildmax changed its year-end to February.
Accordingly the results for the review period are for an eleven month trading
period and are therefore not comparable to the previous year.
Review opinion
The condensed consolidated financial results have been reviewed by Buildmax`s
external auditors, PKF (Jhb) Inc. Their unqualified review opinion is available
for inspection at the company`s registered office.
Dividend
No dividend has been declared for the review period.
Directorate
In light of the repositioning of the group post the acquisitions, the board of
directors was reconstituted. Effective 11 December 2007 PJ de Klerk and HP
Fourie were appointed to the board of Buildmax as non-executive directors. Post
conclusion of the acquisitions, they were appointed as executive directors of
Buildmax in the capacity of Chief Executive Officer and Chief Financial Officer,
respectively. In addition CB Brayshaw, M Matisonn, R Munitz, BT Ngcuka and C
Wood were appointed as non-executive directors effective 28 March 2008. CB
Brayshaw and C Wood, as well as MD Lamola who remained on the board, are
independent non-executive directors.
Effective 28 March 2008 IDP Burger, NR Jansen, MD Smullen and
JPG Vorster resigned as directors. We thank the outgoing board for their
service.
Company secretary
With effect from 1 December 2007 Probity Business Services (Pty) Limited was
appointed as company secretary of Buildmax. Effective the same date HD Venter
resigned in this capacity.
External auditors
PKF (Jhb) Inc. was appointed as external auditors of the group effective 1
January 2008.
On behalf of the board
Paul de Klerk CEO Herman Fourie CFO
29 May 2008
CONDENSED BALANCE SHEET
As at 29 As at 31 Mar
Feb 2008 2007
Reviewed Audited and
restated
Note R`000 R`000
s
ASSETS
Non-current assets
Property, plant and equipment 12 288 13 667
Receivables 2 811 -
Deferred taxation 2 2 186 905
Current assets
Receivables and other current assets 41 507 43 505
Bank and cash 16 901 10 821
Taxation receivable 271 194
Total assets 75 964 69 092
EQUITY AND LIABILITIES
Share capital and reserves 1 53 826 46 996
Non-current liabilities
Long-term liabilities - 18
Deferred taxation 421 1 387
Current liabilities
Payables and other current liabilities 21 500 20 474
Taxation due 217 217
Total equity and liabilities 75 964 69 092
CONDENSED INCOME STATEMENT
Eleven months Twelve
29 Feb 2008 months
31 Mar 2007
Reviewed Audited and
restated
Notes R`000 R`000
Revenue 111 543 112 596
Operating profit 2 827 7 627
Other income 1 750 793
Other expenses (459) -
Profit before interest and taxation 4 118 8 420
Interest received 1 110 1 116
Interest paid (247) (262)
Profit before taxation 4 981 9 274
Taxation 2 1 849 (1 598)
Profit attributable to ordinary 6 830 7 676
shareholders
Basic earnings per share (cents) 16,34 18,36
Headline earnings per share (cents) 16,19 17,83
Reconciliation of headline earnings:
Profit attributable to ordinary 6 830 7 676
shareholders
Adjusted for profit on sale of (63) (221)
property, plant and equipment
Headline earnings 6 767 7 455
Supplementary income statement
information:
Weighted average number of ordinary 41 806 41 806
shares in issue (thousands)
CONDENSED CASH FLOW STATEMENT
Eleven Twelve months
months 29 31 Mar 2007
Feb 2008
Reviewed Audited and
restated
R`000 R`000
Operating activities 5 823 4 440
Investing activities (452) (5 495)
Financing activities 709 (26)
Net cash generated / (utilised) 6 080 (1 081)
Bank and cash at beginning of the 10 821 11 902
period
Bank and cash at end of the period 16 901 10 821
CONDENSED STATEMENT OF CHANGES IN EQUITY
Eleven Twelve
months months
29 Feb 2008 31 Mar 2007
Reviewed Audited and
restated
Notes R`000 R`000
Equity at beginning of the period 46 996 39 357
Prior period error 1 - 590
Restated equity at beginning of the 46 996 39 947
period
Dividends paid - (627)
Profit attributable to ordinary 6 830 7 676
shareholders for the period
Equity at end of the period 53 826 46 996
NOTES TO THE REVIEWED CONDENSED CONSOLIDATED FINANCIAL RESULTS
1. Prior period error
The retained earnings as at 31 March 2006 have been restated as follows:
- an increase of R62 071 due to inventory valuation errors; and
- an increase of R744 121 to correct an error on accumulated depreciation on
property, plant and equipment.
Corresponding balance sheet adjustments have been made to inventory and
property, plant and equipment at 31 March 2006.
The inventory adjustments had no effect on the taxation charge against retained
earnings as the subsidiary had an accumulated tax loss at 31 March 2006.
The error in accumulated depreciation resulted in an increase in the deferred
taxation liability of R215 795 as at 31 March 2006.
The profit before taxation for the 12 months ended 31 March 2007 has been
restated as follows:
- a decrease of R190 842 due to inventory valuation errors; and
- an increase of R558 351 to correct an error on accumulated depreciation on
property, plant and equipment.
Corresponding balance sheet adjustments have been made to inventory and
property, plant and equipment at 31 March 2007.
The inventory adjustments had no effect on the taxation charge against retained
earnings as the subsidiary had an accumulated tax loss at 31 March 2007.
The error in accumulated depreciation resulted in a further increase in the
deferred taxation liability of R161 922 as at 31 March 2007.
2. Deferred tax asset raised at 29 February 2008
The taxation charge for the review period includes the raising of a deferred tax
asset of R2 186 015, which was not previously considered probable.
Directors:
PJ de Klerk (Chief Executive Officer); HP Fourie (Chief Financial Officer); CB
Brayshaw*^; MD Lamola*^; M Matisonn*; R Munitz*;
BT Ngcuka*; C Wood*^ *Non-executive director ^Independent
Registered office:
Buildmax Limited, Davey Street, Germiston, 1401
(PO Box 14100, Germiston, 1400)
Sponsor:
Java Capital (Pty) Limited
Transfer secretaries:
Computershare Investor Services (Pty) Limited
70 Marshall Street, Johannesburg, 2001
(PO Box 61763, Marshalltown, 2107)
Company secretary:
Probity Business Services (Pty) Limited
3rd Floor, JHI House, Cradock Avenue, Rosebank, 2196
(PO Box 85392, Emmarentia, 2029)
Investor relations:
Envisage Investor & Corporate Relations
www.buildmax.co.za
Date: 29/05/2008 17:30:02 Produced by the JSE SENS Department.
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