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HVL
HVL
HVL - Highveld - Report For The Nine Months To 30 September 2008
HIGHVELD STEEL AND VANADIUM CORPORATION LIMITED
Registration No. 1960/001900/06
(Incorporated in the Republic of South Africa)
("Highveld" or "the Corporation")
Share code: HVL
ISIN: ZAE000003422
REPORT FOR THE NINE MONTHS TO 30 SEPTEMBER 2008
- Headline earnings increased by 215 per cent
- Group turnover from continuing operations increased by 157 per cent
- Dividends declared of 1 400 cents per share amounting to R1 388 million,
paid in this fourth quarter
Chairman`s Statement and CEO`s Review
Financial results
The Corporation had its best earnings in any nine month period.
Headline earnings increased from R959 million in 2007 to R2 066 million in 2008.
The improvement was mainly due to significant price increases on both steel and
vanadium products. Operating profit increased by R1 679 million to R3 067
million after a depreciation charge of R193 million (2007: R211 million).
Headline earnings per share increased from 967.3 cents in 2007 to 2 082.5 cents
in 2008.
Net cash inflow for the period was R1 370 million, increasing the cash on hand
to R2 138 million from R768 million at 31 December 2007. The cash inflow from
operations amounted to R2 878 million which was reduced by taxation payments of
R548 million, dividend payments of R1 784 million and capital expenditure of
R386 million.
Subsequent to the reporting date, a further dividend of R1 388 million was paid
in October 2008.
Operations
Steel
Highveld`s gross rolled steel output increased by 1 per cent, compared with the
previous year, but was 17 per cent lower than the initial plan. The major
contributing factors to the decrease were the late start up of the induction
furnace and a subsequent burn through of the furnace, a main drive mill motor
failure in the Structural mill business unit and a re-heat furnace failure in
the Flat products business unit.
Total steel sales volumes for the Corporation for the first nine months of 2008
were 7.3 per cent below budget, but 0.9 per cent lower than in the same period
last year. Domestic despatches for the period were 9 per cent better than the
same period last year. Export shipments were 53 per cent below budget and 44
per cent lower than the same period last year, indicating the focus and priority
to the local market.
Vanadium
Vanadium prices have been consistent for a number of months as supply and demand
seem to have come into balance. Vanchem production levels were not at budgeted
levels, but operations were steadily improving.
The Hochvanadium joint venture in Austria performed well and sales volumes for
the first nine months were in line with budget expectations.
Safety, Health, Environment and Quality
The steady improvement in safety statistics is noticeable with the Corporation`s
lost time injury frequency rate dropping from 0.66 in January 2008 to 0.39 in
September 2008.
The Corporation`s programme for integrated water and waste management and
emission control improvement continues.
Highveld has an integrated SHEQ management system. Currently the Corporation is
ISO 9001 and ISO 14001 certified by TUV Rheinland.
Divestments
Subsequent to the disclosure in the report for the first six months of 2008, the
vanadium divestment transaction ("Divestment Transaction") became effective and
unconditional, resulting in the disposal of the Vanchem division, the 50 per
cent equity interest in South Africa Japan Vanadium (Proprietary) Limited and an
equity interest in Mapochs mine.
The proceeds from the disposal of these assets amounted to R999 million and the
after taxation loss on the Divestment Transaction amounted to R137 million.
The finalisation of the Divestment Transaction is still subject to an objection
period and as a result has therefore been accounted for on a provisional value
basis.
Capital expenditure
Capital expenditure incurred by the Group during the period amounted to R386
million (2007: R462 million) and the total commitment in respect of future
capital expenditure as at 30 September 2008 is R468 million, compared with R471
million at 31 December 2007. This committed expenditure has temporarily been
reduced due to difficult market conditions and uncertain future cash
availability.
Black economic empowerment
During the period under review, goods and services worth R690 million (2007:
R572 million) were purchased from a total of 350 (2007: 193) black empowerment
enterprises.
The Corporation has commenced the process of divesting a portion of its equity
interest in Mapochs mine to a BEE investor. As part of the process, a special
purpose company has been registered into which the Mapochs mine will be sold as
a going concern.
An application for the conversion of the Corporation`s old order mining rights
into new order mining rights as well as an application in terms of Section 11 of
the Minerals and Petroleum Resources Development Act of 2002 for the transfer of
the mining rights into the new special purpose company will be lodged shortly
with the Department of Minerals and Energy.
Outlook
Suddenly, since early October 2008, steel sales to the domestic and
international markets have decreased significantly, mainly as a result of prior
stock build up by merchants in the domestic market as well as the financial
crisis, which is particularly affecting the international markets.
Since our domestic customers are over-stocked and in view of the pending
December closures of the construction and associated industries, the current
order book is extremely low. We have therefore decided to reduce production to
reflect the new level of demand.
In addition to the reduced production, the Corporation has also implemented
stringent cost cutting and cash preservation measures.
The impact of all these unfavourable conditions will make it impossible for the
Corporation to sustain its earnings for the last quarter of 2008.
The Board recognises and acknowledges its responsibility to keep its
stakeholders informed of the situation and will do so in the course of events.
For and on behalf of the Board
JW Campbell WG Ballandino
Acting Chairman Chief Executive Officer
DIRECTORS: W G Ballandino (Chief Executive Officer) (Italian), G C Baizini
(Italian), C B Brayshaw, J W Campbell, A V Frolov (Russian), G A Mannina
(Swiss), B J T Shongwe and P S Tatyanin (Russian)
COMPANY SECRETARY:
Mrs CI Lewis
GROUP FINANCIAL RESULTS
The Group`s financial results for the quarter and nine months ended 30 September
2008 set out below have been prepared in accordance with the principal
accounting policies of the Group, which comply with International Financial
Reporting Standards ("IFRS") and in the manner required by the Companies Act in
South Africa and are consistent with those applied in the Group`s most recent
annual financial statements, except for the Standards and Interpretations as
listed below.
These results are presented in terms of IAS 34 applicable to Interim Financial
Reporting.
In the current year, the Group has adopted all of the new and revised Standards
and Interpretations issued by the International Accounting Standards Board ("the
IASB") and the International Financial Reporting Interpretation Committee of the
IASB ("IFRIC"), that are relevant to its operations and effective for accounting
periods beginning on or after 1 January 2008.
The adoption of these new and revised Standards and Interpretations has resulted
in changes in the Group`s accounting policies and are disclosed as follows:
IFRS 8 - Operating Segments
The Group has elected to early adopt this standard with effect from 1 January
2008.The adoption of this standard has resulted in additional disclosures
contained in the condensed consolidated segmental report.
IAS 23 Borrowing Costs
The Group has elected to early adopt this standard prospectively with effect
from 1 January 2008. The early adoption amounts to a change in accounting policy
but did not have any impact on the interim results as the Group did not incur
any borrowing costs on qualifying assets for the period from 1 January 2008.
IFRIC 12 - Service Concession Arrangements
This interpretation had no impact on the Group`s interim results as the Group
does not operate concession arrangements.
IFRIC 14 - IAS 19 - The Limit on a Defined Benefit Asset, minimum Funding
Requirements and their Interaction
This interpretation had no impact on the Group`s interim results as the Group
has no plan assets in respect of retirement benefits.
The International Accounting Standards Board ("IASB") has issued Improvements to
IFRS - a collection of amendments to International Financial Reporting Standards
in line with their annual improvement project. It deals with amendments to
certain accounting standards contained in this document which are effective to
annual periods beginning on or after 1 January 2009. The Group does not intend
to early adopt these amendments.
The financial information has not been audited or reviewed by the Group`s
independent auditors.
CONDENSED CONSOLIDATED INCOME STATEMENT
Three Three Nine Nine Audited
months months months months for the
ended ended ended ended year
ended
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec
2008 2007 2008 2007 2007
Note Rm Rm Rm Rm Rm
CONTINUING OPERATIONS
Revenue from 2 461 1 305 6 376 4 046 5 378
the sale of
goods
_______ _______ _______ _______ ________
Operating 1 010 365 2 647 1 132 1 421
profit before
depreciation
Depreciation, (64) (81) (193) (219) (250)
scrapping and
changes in
estimated
useful lives
of property,
plant and
equipment
_______ _______ _______ _______ ________
Operating 946 284 2 454 913 1 171
profit
Interest and 40 53 123 65 92
investment
income
received
Finance (8) (15) (23) (63) (64)
charges
_______ _______ _______ _______ ________
Profit before 978 322 2 554 915 1 199
taxation
Taxation (457) (80) (1 010) (294) (146)
charge
_______ _______ _______ _______ ________
Profit for the 521 242 1 544 621 1 053
period from
continuing
operations
======= ======= ======= ======= ========
DISCONTINUED OPERATIONS
Revenue from 386 396 1 288 1 555 1 780
the sale of
goods
_______ _______ _______ _______ ________
Operating 239 102 613 467 569
profit before
depreciation
Depreciation, - 1 8 6
scrapping and
changes in
estimated
useful lives
of property,
plant and
equipment
_______ ______ _______ _______ ________
Operating 239 103 613 475 575
profit
(Loss) / 4 (55) - 162 - 572
profit on
disposal of
discontinued
operations
Interest and 2 - 5 3 5
investment
income
received
Finance (4) (1) (14) (3) (4)
charges
_______ _______ _______ _______ ________
Profit before 182 102 766 475 1 148
taxation
Taxation (61) (30) (203) (138) (298)
charge
_______ _______ _______ _______ ________
Profit for the 121 72 563 337 850
period from
discontinued
operations
_______ _______ _______ _______ ________
TOTAL OPERATIONS
Revenue from 5 2 847 1 701 7 664 5 601 7 158
the sale of
goods
_______ _______ _______ _______ ________
Operating 1 249 467 3 260 1 599 1 990
profit before
depreciation
Depreciation, (64) (80) (193) (211) (244)
scrapping and
changes in
estimated
useful lives
of property,
plant and
equipment
_______ _______ _______ _______ ________
Operating 1 185 387 3 067 1 388 1 746
profit
(Loss) / 4 (55) - 162 - 572
profit on
disposal of
discontinued
operations
Interest and 42 53 128 68 97
investment
income
received
Finance (12) (16) (37) (66) (68)
charges
_______ _______ _______ _______ ________
Profit before 1 160 424 3 320 1 390 2 347
taxation
Taxation (518) (110) (1 213) (432) (444)
charge
_______ _______ _______ _______ ________
Attributable 642 314 2 107 958 1 903
profit for the
period
======= ======= ======= ======= ========
Basic earnings Cents Cents Cents Cents Cents
per share
From 525.5 244.1 1 556.4 626.1 1 061.9
continuing
operations
From 122.0 72.6 567.9 340.5 857.5
discontinued
operations
_______ _______ _______ _______ ________
From total 647.5 316.7 2 124.2 966.6 1 919.4
operations
======= ======= ======= ======= ========
Basic earnings
per share -
diluted
From 525.5 244.1 1 556.4 626.1 1 061.9
continuing
operations
From 122.0 72.6 567.9 340.5 857.5
discontinued
operations
_______ _______ _______ _______ ________
From total 647.5 316.7 2 124.2 966.6 1 919.4
operations
======= ======= ======= ======= ========
------------- -- ---- ------- ------- ------- ------- --------
Reconciliation Rm Rm Rm
of headline
earnings
Attributable 642 314 2 107 958 1 903
profit
Add/(deduct) after tax effect of:
Net loss / 4 137 - (41) - (455)
(profit) on
disposal of
discontinued
operations
Impairment - - - - (7)
losses
reversed
Loss on disposal and - 1 - 1 3
scrapping of property,
plant and equipment
_______ _______ _______ _______ ________
Headline 779 315 2 066 959 1 444
earnings
======= ======= ======= ======= ========
Headline Cents Cents Cents Cents Cents
earnings per
share
From 525.5 244.1 1 556.4 626.1 1 058.0
continuing
operations
From 260.2 72.6 526.1 341.2 398.8
discontinued
operations
_______ _______ _______ _______ ________
From total 785.7 316.7 2 082.5 967.3 1 456.8
operations
======= ======= ======= ======= ========
Headline
earnings per
share -
diluted
From 525.5 244.1 1 556.4 626.1 1 058.0
continuing
operations
From 260.2 72.6 526.1 341.2 398.8
discontinued
operations
_______ _______ _______ _______ ________
From total 785.7 316.7 2 082.5 967.3 1 456.8
operations
======= ======= ======= ======= ========
Number of Million Million Million Million Million
shares
Ordinary 99.2 99.1 99.2 99.1 99.1
shares in
issue as at
period-end
date *
Weighted 99.2 99.1 99.2 99.1 99.1
average number
of ordinary
shares *
Diluted number 99.2 99.1 99.2 99.1 99.1
of ordinary
shares *
* Rounded to nearest hundred thousand
Dividends per Cents Cents Cents Cents Cents
share - based
on calendar
profits
Special - - 1 800 - -
dividend
proposed and
paid
Interim 1 400 - 1 400 - -
dividend
proposed
Final dividend - - - 350 350
proposed and
paid i.r.o
2006
Special - - - 100 100
dividend
proposed and
paid
CONDENSED CONSOLIDATED SEGMENTAL REPORT
The Group is organised into business units based on their products and has three
reportable segments as follows:
Steelworks
The major products of the steel segment are structural steel, plate, coil,
vanadium slag and magnetite iron ore.
Vanadium
The major product of the continuing vanadium segment is ferrovanadium. Vanadium
pentoxide, ferrovanadium and various vanadium chemicals are included in the
discontinued vanadium segment.
Ferro-alloys
The major products of the ferro-alloys segment are ferrosilicon, char,
ferromanganese and silicomanganese.
No operating segments have been aggregated to form the above reportable
operating segments. Management monitors the operating results of its business
units separately for the purposes of making decisions about resource allocation
and performance assessment. Segment performance is evaluated based on operating
profit.
The following tables present the revenue, operating profit and total assets
information regarding the Group`s operating segments.
Three months ended
30 Sep 2008
Continuing operations Discontinued operations
Steelw Vanadi Total Vanadi Ferro- Total
orks um um alloys
Rm Rm Rm Rm Rm Rm
Revenue from
the sale of
goods
Revenue from 1 729 732 2 461 386 386
external
customers
Intersegmental 139 139 2 2
revenue
_____ ______ _______ ______ ______ _____
Total segment 1 868 732 2 600 388 388
revenue
_____ ______ ________ ______ _______ _____
Three months ended
30 Sep 2007
Continuing operations Discontinued operations
Steelw Vanadi Total Vanadi Ferro- Total
orks um um alloys
Rm Rm Rm Rm Rm Rm
Revenue from
the sale of
goods
Revenue from 913 392 1 305 340 56 396
external
customers
Intersegmental 44 44 -
revenue
_____ ______ _______ ______ _______ _____
Total segment 957 392 1 349 340 56 396
revenue
_____ ______ ________ ______ _______ _____
Nine months ended
30 Sep 2008
Continuing Discontinued operations
operations
Steelw Vanadi Total Vanadi Ferro- Total
orks um um alloys
Rm Rm Rm Rm Rm Rm
Revenue from
the sale of
goods
Revenue from 4 341 2 035 6 376 1 268 20 1 288
external
customers
Intersegmental 481 481 4 6 10
revenue
_____ _____ ______ ______ ______ _____
Total segment 4 822 2 035 6 857 1 272 26 1 298
revenue
_____ ______ ______ ______ ______ _____
Nine months ended
30 Sep 2007
Continuing Discontinued operations
operations
Steelw Vanadi Total Vanadi Ferro- Total
orks um um alloys
Rm Rm Rm Rm Rm Rm
Revenue from
the sale of
goods
Revenue from 2 939 1 107 4 046 855 700 1 555
external
customers
Intersegmental 106 106 1 78 79
revenue
______ ______ ______ ______ ______ ______
Total segment 3 045 1 107 4 152 856 778 1 634
revenue
______ ______ ______ ______ ______ ______
Audited for the year ended
31 Dec 2007
Continuing operations Discontinued operations
Steelw Vanadi Total Vanadi Ferro- Total
orks um um alloys
Rm Rm Rm Rm Rm Rm
Revenue from
the sale of
goods
Revenue from 3 929 1 449 5 378 957 823 1 780
external
customers
Intersegmental 135 135 181 97 278
revenue
______ ______ ______ ______ ______ ______
Total segment 4 064 1 449 5 513 1 138 920 2 058
revenue
______ ______ ______ ______ ______ ______
Intersegmental revenues are eliminated on consolidation.
Three months ended Three months ended
30 Sep 2008 30 Sep 2007
Conti- Discon Total Conti- Discon- Total
nuing tinued nuing tinued
opera- opera- opera- opera-
tions tions tions tions
Operating
profit
Steelworks 664 664 164 164
Vanadium 282 238 520 120 94 214
Ferro-alloys 1 1 9 9
______ ______ ______ ______ ______ ______
Total 946 239 1 185 284 103 387
______ ______ ______ ______ ______ ______
Nine months ended Nine months ended
30 Sep 2008 30 Sep 2007
Conti- Discon Total Conti- Discon- Total
nuing tinued nuing tinued
opera- opera- opera- opera-
tions tions tions tions
Operating
profit
Steelworks 1 659 1 659 583 583
Vanadium 795 581 1 376 330 429 759
Ferro-alloys 32 32 46 46
______ ______ ______ ______ ______ ______
Total 2 454 613 3 067 913 475 1 388
______ ______ ______ ______ ______ ______
Audited for the year ended
31 Dec 2007
Continuing Discontinued Total
operations operations
Operating profit
Steelworks 749 749
Vanadium 422 458 880
Ferro-alloys 117 117
______ ______ ______
Total 1 171 575 1 746
______ ______ ______
As at As at
30 Sep 2008 30 Sep 2007
Conti- Discon Total Conti- Discon- Total
nuing tinued nuing tinued
opera- opera- opera- opera-
tions tions tions tions
Total assets
Steelworks 5 678 5 678 2 957 2 957
Vanadium 606 606 584 623 1 207
Ferro-alloys 523 523
______ ______ ______ ______ ______ ______
Total 6 284 6 284 3 541 1 146 4 687
______ ______ ______ ______ ______ ______
Audited as at
31 Dec 2007
Continuing Discontinued Total
operations operations
Total assets
Steelworks 3 772 3 772
Vanadium 268 742 1 010
Ferro-alloys 142 142
______ ______ ______
Total 4 040 884 4 924
______ ______ ______
CONDENSED CONSOLIDATED BALANCE SHEET
As at As at Audited
as at
30 Sep 30 Sep 31 Dec
2008 2007 2007
Notes Rm Rm Rm
ASSETS
Non-current assets 1 881 1 727 1 764
______ ______ ______
Property, plant and 1 881 1 722 1 763
equipment
Other non-current assets - 5 1
______ ______ ______
Current assets 4 403 1 814 2 276
______ ______ ______
Inventories 565 503 495
Accounts receivable 1 700 818 1 013
Cash and cash equivalents 2 138 493 768
______ ______ ______
Assets of disposal group 7 - 1 146 884
classified as held for sale
______ ______ ______
TOTAL ASSETS 6 284 4 687 4 924
====== ====== ======
EQUITY AND LIABILITIES
Shareholders` equity 2 364 2 413 3 379
Non-current liabilities 741 559 723
______ ______ ______
Long-term provisions 374 252 344
Deferred taxation 367 307 379
______ ______ ______
Current liabilities 3 179 1 608 749
______ ______ ______
Shareholders for 1 388 - -
dividends
Taxation 596 303 -
Other current liabilities 1 195 1 305 749
______ ______ ______
Liabilities directly
associated with the assets
classified as held for sale
7 - 107 73
______ ______ ______
TOTAL EQUITY AND 6 284 4 687 4 924
LIABILITIES
====== ====== ======
Net cash 3 2 019 149 785
Net asset value - 2 385 2 433 3 408
cents/share
====== ====== ======
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
Three Three Nine Nine Audited
months months months months for the
ended ended ended ended year
ended
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec
2008 2007 2008 2007 2007
Rm Rm Rm Rm Rm
Cash available from 1 198 740 2 878 1 808 1 924
operations before
taxation paid
Taxation paid (320) (93) (548) (351) (665)
______ ______ ______ ______ ______
Net cash 878 647 2 330 1 457 1 259
flows from
operating
activities
Proceeds from 771 - 1 068 - 989
disposal of
discontinued
operations
Net cash flows (146) (187) (386) (462) (600)
used in other
investing
activities
______ ______ ______ ______ ______
Net cash inflow 1 503 460 3 012 995 1 648
before financing
activities
Net cash flows
(used in) / from
financing
activities
excluding
dividends paid
(32) (453) 136 (583) (967)
Dividends - - (1 784) (446) (446)
paid
______ ______ ______ ______ ______
Net increase /
(decrease) in cash
and cash
equivalents
1 471 7 1 364 (34) 235
Effects of
exchange rate
changes on cash
held in foreign
currencies
(3) 6 6 16 22
Cash and 670 480 768 511 511
equivalents at
beginning of
period
______ ______ ______ ______ ______
Cash and 2 138 493 2 138 493 768
equivalents
at end of
period
====== ====== ====== ====== ======
CONDENSED CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSE
Three Three Nine Nine Audited
months months months months for the
ended ended ended ended year
ended
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec
2008 2007 2008 2007 2007
Rm Rm Rm Rm Rm
Currency (13) 7 51 13 47
translation
differences
Fair value - - - - (3)
revaluation
______ ______ ______ ______ ______
Net (expense) / (13) 7 51 13 44
income recognised
directly in equity
Attributable 642 314 2 107 958 1 903
profit for the
period
______ ______ ______ ______ ______
Total 629 321 2 158 971 1 947
recognised
income for the
period
====== ====== ====== ====== ======
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1 Companies Act and JSE Limited Listings Requirements
Compliance with the Companies Act No. 61 of 1973 as well as the Listings
Requirements of the JSE Limited has been maintained throughout the reporting
periods.
2 Related party transactions
Transactions entered into between the Group and its related parties during the
reporting periods were arms length transactions between knowledgeable, willing
parties at fair value.
3 Net cash
Net cash is calculated as follows:
Nine months Nine Audited
ended months for the
ended year
ended
30 Sep 2008 30 Sep 31 Dec
2007 2007
Rm Rm Rm
Cash and cash 2 138 493 768
equivalents
Loan to joint - 8 17
venture
Less: Short- (119) (352) -
term loans
______ ______ ______
Net cash 2 019 149 785
====== ====== ======
4 (Loss) / profit Three Three Nine Nine Audited
on disposal of months months months months for the
discontinued ended ended ended ended year
operations ended
30 Sep 2008 30 Sep 30 Sep 30 Sep 31 Dec
2007 2008 2007 2007
Rm Rm Rm Rm Rm
Total proceeds 999 - 1 296 - 989
Net asset value (1 054) - (1 134) - (417)
disposed of
_______ ______ _______ ______ _______
(Loss) / profit (55) - 162 - 572
on disposal
before taxation
Taxation charge (82) - (121) - (117)
_______ ______ _______ ______ _______
(Loss) / profit (137) - 41 - 455
on disposal
after taxation
======= ====== ======= ====== =======
5 Supple- For the For the For the For the For the
mentary three three nine nine year
revenue months months months months ended
informa- ended ended ended ended
tion -
Unaudi-
ted
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec
2008 2007 2008 2007 2007
Sales volumes
of major
products
Continuing
operations
Total Tons 178 726 168 808 545 585 550 465 730 228
steel
Ferrova- kg V 1 313 423 1 475 026 4 129 766 4 270 234 5 595 359
nadium
Vanadium tons 3 472 4 081 10 302 10 984 14 243
slag V2O5
Discontinued
operations
Ferrova- kg V 308 980 366 515 1 294 002 1 478 724 2 061 671
nadium
and
ferrova-
nadium
nitride
Vanadium kg 690 592 1 101 560 2 479 734 3 275 347 4 276 779
pento- V2O5
xide
Vanadium kg 186 662 287 123 740 442 1 049 750 1 300 759
chemical V2O5
s
Weighted average selling
prices achieved for major
products
Continuing
operations
Total $/t 1 150 747 947 714 731
steel
Ferrova- $/kg 67 39 63 36 37
nadium V
Discontinued
operations
Ferrova- $/kg 57 36 56 34 35
nadium V
Vanadium $/kg 31 15 27 15 15
pento- V2O5
xide
Vanadium $/kg 31 15 24 14 18
chemi- V2O5
cals
Average 7.79 7.09 7.70 7.15 7.06
R/$
exchange
rate
6 Financial
ratios
Current 1.39 1.73 1.39 1.73 3.84
ratio
Market 12 890 11 254 12 890 11 254 11 203
capitalisati
on - Rm
7 Disposal groups
In terms of a European Union competition ruling Highveld is required to dispose
of the Vanchem division and its interest in South Africa Japan Vanadium
(Proprietary) Limited ("SAJV"). The Vanchem division and the interest in SAJV
have been treated as disposal groups for the period to 30 June 2008 and are
reported as discontinued operations. The sale agreements for the Vanchem
division and SAJV have been concluded and the effective date of sale for the
Vanchem division was 29 August 2008. The assets and related liabilities of these
disposal groups were as follows:
As at As at Audited
as at
30 Sep 30 Sep 31 Dec
2008 2007 2007
Rm Rm Rm
ASSETS
Non-current assets - 620 573
classified as held for sale
Current assets classified - 526 311
as held for sale
______ ______ ______
- 1 146 884
______ ______ ______
EQUITY AND LIABILITIES
Liabilities directly - 107 73
associated with assets
classified as held for sale
====== ====== ======
Three Three Nine Nine Audited
months months months months for the
ended ended ended ended year
ended
30 Sep 30 Sep 30 Sep 30 Sep 31 Dec
2008 2007 2008 2007 2007
Rm Rm Rm Rm Rm
The cash
flows were
as follows:
Cash inflow 203 109 323 303 417
from
operating
activities
Cash inflow / 276 (17) 239 (92) (117)
(outflow) from
investing
activities
excluding
disposal
proceeds
Cash outflow - (4) - (66) (66)
from
financing
activities
______ ______ ______ ______ ______
Total cash 479 88 562 145 234
inflow
====== ====== ====== ====== ======
8 Condensed statements of changes in equity
Share Fair Total
capital Translation value Retained
and and share- reserves profit
share based
premium payment
reserves
Rm Rm Rm Rm Rm
2007
Currency 6 6
translation
differences
______ ______ ______ ______ ______
Net income 6 - - 6
recognised
directly in
equity
Attributable 643 643
profit for
the period
as
previously
stated
______ ______ ______ ______ _______
Total 6 - 643 649
recognised
income for
the period
Balance at 585 54 3 1 243 1 885
31 December
2006 as
audited
Dividends (446) (446)
paid
Change in 1 1
accounting
policy
Recognition (7) (7)
of share-
based
payments
______ ______ ______ ______ ______
Balance at 585 53 3 1 441 2 082
30 June 2007
- Reviewed
Currency 17 17
translation
differences
______ ______ ______ ______ ______
Net income - 17 - - 17
recognised
directly in
equity
Attributable 314 314
profit for
the period
______ ______ _______ ______ ______
Total 17 - 314 331
recognised
income and
expense for
the period
_______ _______ _______ ______ ______
Balance at 585 70 3 1 755 2 413
30 September
2007 -
Unaudited
====== ====== ====== ====== ======
Currency 24 24
translation
differences
Fair value (3) (3)
adjustments
______ ______ ______ ______ ______
Net income / 24 (3) - 21
(expense)
recognised
directly in
equity
Attributable 945 945
profit for
the period
______ ______ ______ ______ ______
Total 24 (3) 945 966
recognised
income and
expense for
the period
______ ______ ______ ______ ______
Balance at 585 94 - 2 700 3 379
31 December
2007 -
audited
====== ====== ====== ====== ======
Interim -
2008
Currency 64 64
translation
differences
______ ______ ______ ______ ______
Net income 64 - - 64
recognised
directly in
equity
Attributable 1 465 1 465
profit for
the period
______ ______ ______ ______ ______
Total 64 - 1 465 1 529
recognised
income for
the period
______ ______ ______ ______ ______
Balance at 585 94 - 2 700 3 379
31 December
2007 -
audited
Dividends (1 784) (1 784)
paid
______ ______ ______ ______ ______
Balance at 585 158 - 2 381 3 124
30 June 2008
- reviewed
====== ====== ====== ====== ======
Quarter
three - 2008
Currency (14) (14)
translation
differences
______ ______ ______ ______ ______
Net expense (14) - - (14)
recognised
directly in
equity
Attributable 642 642
profit for
the period
______ ______ ______ ______ ______
Total (14) - 642 628
recognised
income and
expense for
the period
______ ______ ______ ______ ______
Balance at 585 158 - 2 381 3 124
30 June 2008
- reviewed
Dividends (1 388) (1 388)
paid
______ ______ ______ ______ ______
Balance at 585 144 - 1 635 2 364
30 September
2008 -
reviewed
====== ====== ====== ====== ======
9 Contingent liabilities
As required by the Mineral and Petroleum Resources Development Act, a
guarantee amounting to R190 million (2007:R176 million) was issued in
favour of the Department of Minerals and Energy for rehabilitation cost for
the unscheduled closure of the Mapochs mine.
10 Subsequent events
There has been no reportable post-balance sheet events.
Date:
12 November 2008
Sponsor:
J.P. Morgan Equities Ltd.
Date: 12/11/2008 10:37:17 Produced by the JSE SENS Department.
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