| Tue 16 Sep 2008, 9:50 | | CSB - Cashbuild Limited - Audited annual financial results and dividend |
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CSB
CSB
CSB - Cashbuild Limited - Audited annual financial results and dividend
declaration June 2008
CASHBUILD LIMITED
(Registration number: 1986/001503/06)
(Incorporated in the Republic of South Africa)
JSE Share Code: CSB ISIN: ZAE000028320
AUDITED ANNUAL FINANCIAL RESULTS AND DIVIDEND DECLARATION JUNE 2008
REVENUE UP 17% NET ASSET VALUE PER SHARE UP 34% OPERATING PROFIT UP 25%
HEADLINE EARNINGS UP 35% DIVIDEND PER SHARE UP 32%
CONDENSED GROUP INCOME STATEMENT - AUDITED
R`000 Year ended Year ended
30 June 30 June
2008 2007 %
52 weeks 53 weeks change
Revenue 4,043,493 3,448,386 17
Cost of sales (3,171,658) (2,709,854) 17
Gross profit 871,835 738,532 18
Selling and marketing expenses (552,885) (474,334) 17
Administrative expenses (97,656) (85,404) 14
Other operating expenses (3,326) (3,674) (9)
Other income 9,447 7,228 31
Operating profit 227,415 182,348 25
Finance cost (2,886) (2,533) 14
Finance income 20,200 11,856 70
Profit before income tax 244,729 191,671 28
Income tax expense (75,180) (63,333) 19
Profit for the year 169,549 128,338 32
Attributable to:
Equity holders of the company 160,768 121,640 32
Minority interest 8,781 6,698 31
169,549 128,338 32
Earnings per share (cents) 707.9 536.3 32
Diluted earnings per share (cents) 707.9 536.3 32
ADDITIONAL INFORMATION - AUDITED
R`000 Year ended Year ended
30 June 30 June
2008 2007
Net asset value per share (cents) 1,825 1,361
Ordinary shares (`000):
- In issue 25,805 25,805
- Weighted-average 22,709 22,681
- Diluted weighted-average 22,709 22,681
Capital expenditure 69,106 75,918
Depreciation of property, plant
and equipment 33,866 28,635
Amortisation of intangible assets 1,802 1,333
Impairment of intangible assets - 462
Capital commitments 170,012 75,445
Property operating lease commitments 775,477 733,872
Contingent liabilities 16,850 12,376
CONDENSED GROUP BALANCE SHEET - AUDITED
R`000 30 June 30 June
2008 2007
ASSETS
Non-current assets 299,971 261,721
Property, plant and equipment 276,070 248,434
Intangible assets 11,274 5,047
Deferred income tax assets 12,627 8,240
Current assets 1,304,794 772,583
Assets held for sale 2,740 2,740
Inventories 832,449 609,308
Trade and other receivables 88,228 60,955
Cash and cash equivalents 381,377 99,580
Total assets 1,604,765 1,034,304
EQUITY AND LIABILITIES
Shareholders` equity 505,109 383,293
Share capital and reserves 470,967 351,218
Minority interest 34,142 32,075
Non-current liabilities 43,052 35,537
Deferred operating lease liability 39,330 31,982
Deferred profit 1,855 1,907
Deferred income tax liability - 3
Borrowings (non interest-bearing) 1,867 1,645
Current liabilities 1,056,604 615,474
Trade and other liabilities 1,022,140 575,123
Current income tax liabilities 33,224 39,222
Employee benefits 1,240 1,129
Total equity and liabilities 1,604,765 1,034,304
CONDENSED GROUP CASH FLOW STATEMENT - AUDITED
R`000 Year ended Year ended
30 June 30 June
2008 2007
52 weeks 53 weeks
Cash flows from operating activities
Cash generated from operations 469,508 120,421
Interest paid (2,886) (2,533)
Taxation paid (85,568) (64,838)
Net cash generated from operating
activities 381,054 53,050
Cash flows from investing activities
Net investment in assets (68,681) (66,233)
Interest received 20,200 11,856
Net cash used in investing activities (48,481) (54,377)
Cash flows from financing activities
Net treasury shares movement - 2,313
Increase in other borrowings 222 191
Dividends paid
- own equity (44,284) (31,062)
- minorities (6,714) (2,559)
Net cash used in financing activities (50,776) (31,117)
Net increase/(decrease) in cash
and cash equivalents 281,797 (32,444)
Cash and cash equivalents at
beginning of year 99,580 132,024
Cash and cash equivalents at
end of year 381,377 99,580
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY - AUDITED
R`000
Attributable to equity holders of the company
Treasury Treasury Cum.
Share share Share share translation Retained Minority Total
capital capital premium premium adjustment earnings interest equity
Balance at 1 July 2006
258 (30) 115,817 (85,998) (6,850) 235,712 27,936 286,845
Profit for the year
- - - - - 121,640 6,698 128,338
Dividend paid
- - - - - (31,062) (2,559) (33,621)
Treasury shares movement
- 1 - 2,312 - - - 2,313
Currency translation adjustments
- - - - (582) - - (582)
Closing balance at 30 June 2007
258 (29) 115,817 (83,686) (7,432) 326,290 32,075 383,293
Profit for the year
- - - - - 160,768 8,781 169,549
Dividend paid
- - - - - (44,284) (6,714) (50,998)
Treasury shares movement
- - - - - - - -
Currency translation adjustments
- - - - 3,265 - - 3,265
Closing balance at 30 June 2008
258 (29) 115,817 (83,686) (4,167) 442,774 34,142 505,109
CONDENSED GROUP SEGMENTAL ANALYSIS - AUDITED
R`000 Other members
of common Botswana
South Africa monetary area* and Malawi Group
Year ended Year ended Year ended Year ended
30 June 30 June 30 June 30 June
2008 2008 2008 2008
Income statement
Revenue 3,346,359 411,623 285,511 4,043,493
Operating profit 178,245 24,278 24,892 227,415
Balance sheet
Segment assets 1,268,995 194,139 141,631 1,604,765
Segment liabilities 901,539 111,485 86,632 1,099,656
Other segment items
Depreciation 29,751 2,826 1,289 33,866
Amortisation 1,766 - 36 1,802
Impairment - - - -
Capital expenditure 67,914 675 517 69,106
*Includes Namibia, Swaziland and Lesotho
Other members
of common Botswana
South Africa monetary area* and Malawi Group
Year ended Year ended Year ended Year ended
30 June 30 June 30 June 30 June
R`000 2007 2007 2007 2007
Income statement
Revenue 2,843,136 382,039 223,211 3,448,386
Operating profit 150,272 16,593 15,483 182,348
Balance sheet
Segment assets 814,280 118,612 101,412 1,034,304
Segment liabilities 536,731 42,157 72,123 651,011
Other segment items
Depreciation 24,618 2,927 1,090 28,635
Amortisation 1,298 - 35 1,333
Impairment 462 - - 462
Capital expenditure 66,926 6,476 2,516 75,918
*Includes Namibia, Swaziland and Lesotho
NOTES TO THE CONDENSED GROUP ANNUAL FINANCIAL INFORMATION
1. Basis of preparation.
The condensed consolidated financial information ("financial information")
announcement is based on the audited financial statements of the group for the
year ended 30 June 2008 which have been prepared in accordance with
International Financial Reporting Standards ("IFRS"), the Listings Requirements
of the JSE Limited and the South African Companies Act (1973).
2. Independent audit by the auditors.
These condensed consolidated results have been audited by our auditors
PricewaterhouseCoopers Inc., who have performed their audit in accordance with
the International Standards on Auditing. A copy of their unqualified audit
report is available for inspection at the registered office of the company.
3. Reporting period.
The group adopts the retail accounting calendar, which comprises the reporting
period ending on the last Saturday of the month (2008: 28 June (52 weeks); 2007:
30 June (53 weeks)).
4. Earnings per share.
Earnings per share is calculated by dividing the earnings attributable to
shareholders for the year by the weighted average number of 22,709,487 ordinary
shares in issue during the year (June 2007: 22,680,722 shares).
5. Headline earnings per ordinary share.
The calculations of headline earnings and diluted headline earnings per ordinary
share are based on headline earnings of R161.2 million (June 2007: R119.8
million) and a weighted average of 22,709,487 (June 2007: 22,680,722) and fully
diluted of 22,709,487 (June 2007: 22,680,722) ordinary shares in issue.
Reconciliation between net profit attributable to the equity holders of the
company and headline earnings:
R`000 Jun-08 Jun-07 % change
Net profit attributable to the
company`s equity holders 160,768 121,640 32
Amortisation/impairment of
goodwill - 462
Loss/(profit) on sale of assets
after taxation 391 (2,351)
Headline earnings 161,159 119,751 35
Headline earnings per share (cents) 709.7 528.0 34
Diluted headline earnings per share
(cents) 709.7 528.0 34
6.Declaration of dividend.
The board has declared a final dividend (No. 31), of 128 cents (June 2007: 94
cents) per ordinary share to all shareholders of Cashbuild Limited. The dividend
per share is calculated based on 25,805,347 (2007: 25,805,347) shares in issue
at date of dividend declaration. The total dividend for the year amounts to 229
cents (2007: 173 cents) a 32% increase year on year.
Date dividend declared: Monday, 15 September 2008
Last day to trade "CUM" the dividend: Friday, 3 October 2008
Date commence trading "EX" the dividend: Monday, 6 October 2008
Record date: Friday, 10 October 2008
Date of payment: Monday, 13 October 2008
Share certificates may not be dematerialised or rematerialised between Monday, 6
October and Friday, 10 October 2008, both dates inclusive.
On behalf of the board
DONALD MASSON PAT GOLDRICK
Chairman Chief executive
Johannesburg 15 September 2008
COMMENTS
NATURE OF BUSINESS
Cashbuild is southern Africa`s largest retailer of quality building materials
and associated products, selling direct to a cash-paying customer-base through
our constantly expanding chain of stores (173 at the end of this reporting
year). Cashbuild carries an in-depth quality product range tailored to the
specific needs of the communities we serve. Our customers are typically home-
builders and improvers, contractors, farmers, traders, large construction
companies and government-related infrastructure developers, as well as all other
customers requiring quality building materials at lowest prices.
Cashbuild has built its credibility and reputation by consistently offering its
customers quality building materials at the lowest prices and through a
purchasing and inventory policy that ensures customers` requirements are always
in stock.
TRADING WEEKS
For the year under review Cashbuild had the normal 52 trading weeks compared to
the prior year`s 53 weeks. When comparing the year under review with 52 weeks
for the 2007 financial year the increase would have been as follows:
Revenue Up 20%
Operating profit Up 35%
Earnings per share Up 42%
Headline earnings per share Up 46%
FINANCIAL HIGHLIGHTS
The following information is presented on the basis of comparing the current
year`s 52 weeks trading with the prior year`s 53 weeks.
Revenue for the year increased by 17% whilst profit increased by 32%. This
increase in profit was the result of an improvement in operating profit of 25%
as well as an 86% increase in net finance income. Basic earnings per share
increased by 32% whilst headline earnings per share increased by 34%. Net asset
value per share has shown a 34% increase, from 1,361 cents (June 2007) to 1,825
cents. Cash and cash equivalents increased by 283% mainly due to suppliers being
paid after the cut-off for year end.
Stores in existence since the beginning of July 2006 (pre-existing stores)
accounted for 11% of the increase in revenue with the remaining 6% increase due
to the 24 new stores the group has opened since July 2006. The increase for the
year has been achieved on the back of steady revenue growth in the first three
quarters of this financial year, with excellent growth in the 4th quarter. Gross
profit margins for the year were slightly higher in percentage terms at 21.6%
(June 2007: 21.4%), but in rand terms have increased by a pleasing 18%.
Operational expenses for the year remained well controlled with existing stores
increasing by 11%. New stores contributed 5%, the total increase for the year
being 16%. The main contributor to the increase on the existing stores is the
continued investment in people to maintain and improve customer service
standards, as well as customer focused advertising that was undertaken during
the year.
The effective tax rate for the year of 31% is lower than the prior year. mainly
due to the 1% reduction in the South African Companies tax rate from 29% to 28%.
Cashbuild`s balance sheet remains solid. Stock levels have increased by 37% as a
result of comparable growth in sales of 29% during the 4th quarter. This
increase is further attributable to the stocking of nine additional stores since
the prior year-end (accounting for 8% of the increase). Some strategic decisions
were made relating to stock levels on certain key line items which also resulted
in higher stockholding. Overall stockholding at 87 days (June 2007: 72 days)
showed an increase on the prior year due to the reasons referred to above. Trade
receivables increased in line with expectations and remain well under control.
During the year Cashbuild opened nine new stores, three stores were relocated
and five stores refurbished. Cashbuild will continue its store expansion,
relocation and refurbishment strategy in a controlled manner, with more than ten
new stores planned to open during the next financial year.
INFORMATION TECHNOLOGY
The project whereby Cashbuild`s total IT requirement will be replaced with a
fully integrated SAP All-in-One and Active Retail solution, is progressing
according to plan and is currently in the realisation phase. The project is
expected to be completed by December 2009.
PROSPECTS
Management remains confident about the trading prospects for the next quarter
based on the fact that the first nine trading weeks since year-end have reported
an increase in revenue in the region of 29% on that of the comparable nine
weeks.
Directors: D Masson* (Chairman), PK Goldrick (Chief executive) (Irish), WF de
Jager, J Molobela*, KB Pomario, FM Rossouw*, NV Simamane*, SA Thoresson, A van
Onselen (*Non-executive)
Company secretary: Corporate Governance Leaders CC
Registered office: cnr Aeroton and Aerodrome Roads, Aeroton, Johannesburg 2001
PO Box 90115, Bertsham 2013
Transfer secretaries: Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg 2001
PO Box 61051, Marshalltown 2107
Auditors: PricewaterhouseCoopers Inc.
Sponsor: Nedbank Capital
QUALITY BUILDING MATERIALS AT THE LOWEST PRICES
www.cashbuild.co.za
Date: 16/09/2008 09:50:32 Produced by the JSE SENS Department.
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