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HVL
HVL
HVL - Highveld - Reviewed results for the year ended 31 December 2008
STEEL AND VANADIUM CORPORATION LIMITED
(Incorporated in the Republic of South Africa)
(Registration number : 1960/001900/06)
Share code: HVL & ISIN: ZAE000003422
("Highveld" or "the Corporation")
REVIEWED RESULTS
for the year ended 31 December 2008
Group turnover from continued operations increased by 49 percent
Headline earnings per share from continued operations increased by
109 percent
Group Reviewed Financial Results
The Group`s financial results for the quarter and twelve months ended 31
December 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 results as the Group did not incur
any borrowing costs on qualifying assets for the period from 1 January 2008.
IFRIC 11 - IFRS 2 - Group and Treasury Share Transactions
This interpretation had no impact on the Group`s results as the Group has no
treasury share arrangements in place.
IFRIC 12 - Service Concession Arrangements
This interpretation had no impact on the Group`s 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 results as the Group has no
plan assets in respect of retirement benefits.
The 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 been reviewed by Ernst & Young Inc. in accordance
with ISRE 2410 "Review of Interim Financial Information Performed by the
Independent Auditors of the Entity", whose unmodified report is available for
inspection at the Corporation`s registered office.
Acting Chairman and CEO`s Review
Business strategy
With the sale of the Corporation`s Vanchem division and other related vanadium
assets during 2008, Highveld has now been transformed into a vertically
integrated steel and vanadium slag producer. The focus is now, more than ever,
on the optimisation of its production with the aim of becoming a Total
Productive Organisation, addressing the elimination of all forms of waste.
An instant impact of the global financial crisis was a sharp decrease in orders
and steel prices, and therefore the Corporation will be focusing aggressively
on entering new markets, both nationally and internationally. The depressed
economic climate has also resulted in the Corporation implementing labour
restructuring and reorganisation.
Financial results
The first three quarters of 2008, and more specifically the third quarter,
culminated in the best ever financial results for the Corporation,
notwithstanding dramatically decreased average selling prices and production
cuts in the fourth quarter.
Despite the negative trend in the fourth quarter, the annual results were
satisfactory. The Group`s turnover from continuing operations increased by 49
per cent (R8 022 million (2007: R5 378 million)) and headline earnings per
share from continuing operations by 109 per cent (2 210.6 cents (2007: 1 058.0
cents)). Profit for the year increased by 33 per cent and net cash generated by
operating activities increased by 175 per cent from R1 259 to R3 464 million.
The Group EBITDA for the financial year of 2008 was R3 943 million (2007: R2
562 million).
A special dividend of 1 800 cents per share was paid on 17 June 2008 and an
interim dividend of 1 400 cents per share was paid on 6 October 2008, totalling
R3.173 billion.
Business risks
As part of the management strategy, the identified key risk areas are monitored
continually with a view to eliminating risks, alternatively mitigating risks to
acceptable levels. The high impact risks identified are the financial soundness
of our customers, the availability of energy, fluctuations in commodity prices,
foreign exchange rates, the impact of operations on the environment and the
availability of rail transportation.
Operations
Steel
Despite a decrease of 1.2 per cent of the total world steel production for
2008, it was the second consecutive year that more than 1.3 billion tons of
steel were produced worldwide. China exceeded the 500 million tons of steel
level, a first for any country, with its crude steel output increased by 2.6
per cent to 502 million tons, claiming a 38 per cent stake in the world`s total
steel output.
During 2008, the Corporation focused on the local and African markets.
Highveld`s gross rolled steel output and total sales volumes decreased by 10.4
per cent and 8.5 per cent respectively compared with 2007. This decrease was
mainly due to certain operational problems, such as lack of electricity supply
as well as the sudden downturn in the market as from the fourth quarter 2008,
necessitating a planned reduction in production volumes due to weakening
demand.
The commissioning of the new Flat Products Plate Mill upgrade should improve
operational quality and quantity of flat products (coil and plate) in the long
run, once the markets have stabilised. The commissioning of the channel
induction furnace would dramatically improve the production costs at the Steel
plant.
Vanadium
Vanadium prices fluctuated wildly during 2008, with high prices of up to US$90
per kg V in ferrovanadium reached during February 2008, plummeting to below
US$26 per kg V in ferrovanadium at the end of 2008. Vanadium pentoxide
(V2O5) prices followed a similar trend with prices that escalated to US$18 per
lb during June 2008 and thereafter falling to US$7 per lb in December 2008.
Vanadium slag production decreased substantially during the last quarter of
2008 as a result of substantially reduced demand.
Safety, health, environment and quality
The Board deeply regrets the death of two employees and a contractor during
2008. The Corporation has re-focused on safety and accident prevention to
ensure that the lost time injury frequency rate target set for 2009, being
0.35, is achieved.
Divestment
The sale of Rand Carbide`s assets (property, plant and equipment and
inventories less certain employee related provisions) to Silicon Smelters
(Proprietary) Limited became unconditional and effective on 1 February 2008.
The divestment of the vanadium assets of the Corporation to Vanchem Vanadium
Products (Proprietary) Limited, which included the Vanchem division, 50 per
cent shareholding in South Africa Japan Vanadium (Proprietary) Limited and an
equity stake in Mapochs Mine (Proprietary) Limited became unconditional and
effective on 29 August 2008 with part payment of the consideration made on 12
September 2008.
Outlook for 2009
The outlook for the steel market for 2009 remains concerning, with no
indication of when any improvement in economic conditions will favour increased
production and sales, motivating the re-activation of the Corporation`s
structured capital expenditure programme. In addition, the Corporation has had
to sell certain of its basic products in the international market at distressed
prices to maintain a reduced but economic level of output.
While every action is being reviewed to ensure the sustainability of the
business, major focus has been placed on reducing working capital and
operational costs and improving efficiencies. It is clear that producing to
stock is not an option that should be considered. Highveld has a policy to
produce only on orders received.
In respect of employment the Corporation has reduced the extent of services
supplied by external service providers thus currently minimising the impact on
our employees.
In view of the current difficult operating climate under which the Corporation
operates, together with the dividends declared during the year, the Board
believes that it is not prudent to declare a final dividend for the year.
As the Corporation ended the year with approximately R1.6 billion in cash, the
Board further believes at this time that with prudent cash management, it will
be able to meet its statutory tax payments due in respect of prior years and be
able to operate for an extended period of reduced output in the current price
environment and therefore the Board concludes that the Corporation will remain
a going concern.
J W Campbell W G Ballandino
(Acting Chairman) (Chief Executive Officer)
11 March 2009
Condensed Consolidated Income Statements
Reviewed for Unaudited for
the three the three
months ended months ended
31 Dec 2008 31 Dec 2007
Note Rm Rm
CONTINUING OPERATIONS
Revenue from the sale of goods 1 646 1 332
Operating profit before depreciation 674 289
Depreciation, scrapping and changes
in estimated useful lives of property,
plant and equipment (59) (31)
Operating profit 615 258
Interest and investment income received 39 27
Finance charges (16) (1)
Profit before taxation 638 284
Taxation (5) 148
Profit after taxation from
continuing operations 633 432
DISCONTINUED OPERATIONS
Revenue from the sale of goods - 225
Operating (loss)/profit before
depreciation (4) 102
Depreciation, scrapping and changes
in estimated
useful lives of property,
plant and equipment - (2)
Operating (loss)/profit (4) 100
(Loss)/profit on disposal of
discontinued operations 4 (149) 572
Interest and investment income
received 3 2
Finance charges (2) (1)
(Loss)/profit before taxation (152) 673
Taxation (49) (160)
(Loss)/profit after taxation from
discontinued operations (201) 513
TOTAL OPERATIONS
Revenue from the sale of goods 5 1 646 1 557
Operating profit before depreciation 670 391
Depreciation, scrapping and changes
in estimated useful lives of
property, plant and equipment (59) (33)
Operating profit 611 358
(Loss)/profit on disposal of
discontinued operations 4 (149) 572
Interest and investment income
received 42 29
Finance charges (18) (2)
Profit before taxation 486 957
Taxation (54) (12)
Profit for the period/year 432 945
Earnings per share - basic
and diluted Cents Cents
From continuing operations 638.2 435.7
From discontinued operations (201.8) 517.4
From total operations 436.4 953.1
Reconciliation of headline earnings Rm Rm
Profit for the period/year 432 945
Add/(deduct) after tax effect of:
Loss/(profit) on disposal of
discontinued operations 114 (455)
Loss on impairment of investment 5 -
Impairment losses reversed - (7)
Loss on disposal and scrapping of
property, plant and equipment 11 2
Headline earnings 562 485
Earnings per share - headline and diluted Cents Cents
From continuing operations 654.2 435.7
From discontinued operations (86.6) 58.5
From total operations 567.6 494.2
Number of shares Million Million
Ordinary shares in issue as at end date * 99.2 99.1
Weighted average number of ordinary shares * 99.2 99.1
Diluted number of ordinary shares * 99.2 99.1
* Rounded to nearest hundred thousand
Dividends per share Cents Cents
Dividends declared and paid 1 400 -
Reviewed for Audited for
the year the year
ended ended
31 Dec 2008 31 Dec 2007
Rm Rm
CONTINUING OPERATIONS
Revenue from the sale of goods 8 022 5 378
Operating profit before depreciation 3 321 1 421
Depreciation, scrapping and changes in estimated
useful lives of property, plant and equipment (252) (250)
Operating profit 3 069 1 171
Interest and investment income received 162 92
Finance charges (39) (64)
Profit before taxation 3 192 1 199
Taxation (1 015) (146)
Profit after taxation from continuing operations 2 177 1 053
DISCONTINUED OPERATIONS
Revenue from the sale of goods 1 288 1 780
Operating (loss)/profit before depreciation 609 569
Depreciation, scrapping and changes in estimated
useful lives of property, plant and equipment - 6
Operating (loss)/profit 609 575
(Loss)/profit on disposal of discontinued operations 13 572
Interest and investment income received 8 5
Finance charges (16) (4)
(Loss)/profit before taxation 614 1 148
Taxation (252) (298)
(Loss)/profit after taxation from discontinued
operations 362 850
TOTAL OPERATIONS
Revenue from the sale of goods 9 310 7 158
Operating profit before depreciation 3 930 1 990
Depreciation, scrapping and changes in
estimated
useful lives of property, plant and equipment (252) (244)
Operating profit 3 678 1 746
(Loss)/profit on disposal of discontinued
operations 13 572
Interest and investment income received 170 97
Finance charges (55) (68)
Profit before taxation 3 806 2 347
Taxation (1 267) (444)
Profit for the period/year 2 539 1 903
Earnings per share - basic and diluted Cents Cents
From continuing operations 2 194.6 1 061.9
From discontinued operations 366.1 857.5
From total operations 2 560.7 1 919.4
Reconciliation of headline earnings Rm Rm
Profit for the period/year 2 539 1 903
Add/(deduct) after tax effect of:
Loss/(profit) on disposal of discontinued operations 73 (455)
Loss on impairment of investment 5
Impairment losses reversed - (7)
Loss on disposal and scrapping of property,
plant and equipment 11 3
Headline earnings 2 628 1 444
Earnings per share - headline and diluted Cents Cents
From continuing operations 2 210.6 1 058.0
From discontinued operations 439.5 398.8
From total operations 2 650.1 1 456.8
Number of shares Million Million
Ordinary shares in issue as at end date * 99.2 99.1
Weighted average number of ordinary shares * 99.2 99.1
Diluted number of ordinary shares * 99.2 99.1
* Rounded to nearest hundred thousand
Dividends per share Cents Cents
Dividends declared and paid 3 200 450
Condensed Consolidated Balance Sheets
Reviewed as at Audited as at
31 Dec 2008 31 Dec 2007
Note Rm Rm
ASSETS
Non-current assets 1 956 1 764
Property, plant and equipment 1 956 1 763
Available-for-sale investments - 1
Current assets 3 381 2 276
Inventories 831 495
Trade and other receivables 769 1 013
Prepaid expenditure 180 -
Cash and cash equivalents 1 601 768
Assets of disposal group
classified as held-for-sale 7 - 884
TOTAL ASSETS 5 337 4 924
EQUITY AND LIABILITIES
Shareholders` equity 2 842 3 379
Non-current liabilities 739 723
Long-term provisions 422 344
Deferred taxation 317 379
Current liabilities 1 756 749
Taxation 722 -
Other current liabilities 1 034 749
Liabilities directly associated
with the assets
classified as held-for-sale 7 - 73
Total liabilities 2 495 1 545
TOTAL EQUITY AND LIABILITIES 5 337 4 924
Net cash 3 1 601 785
Net asset value - cents per share 2 866 3 408
Condensed Consolidated Statements of Recognised Income and Expense
Reviewed for Unaudited for
the three the three
months ended months ended
31 Dec 2008 31 Dec 2007
Rm Rm
Currency translation differences 46 34
Fair value revaluation - (3)
Net income recognised directly in equity 46 31
Profit for the period/year 432 945
Total recognised income for the period/year 478 976
Reviewed for Audited for
the year the year
ended ended
31 Dec 2008 31 Dec 2007
Rm Rm
Currency translation differences 97 47
Fair value revaluation - (3)
Net income recognised directly in equity 97 44
Profit for the period/year 2 539 1 903
Total recognised income for the period/year 2 636 1 947
Condensed Consolidated Cash Flow Statements
Reviewed for Unaudited for
the three the three
months ended months ended
31 Dec 2008 31 Dec 2007
Rm Rm
Cash available from operations before taxation 1 116 116
Taxation received/(paid) 18 (314)
Net cash flows from operating activities 1 134 (198)
Proceeds (paid)/received from disposal of
discontinued operations (13) 989
Net cash flows used in other investing activities (157) (138)
Net cash inflow before financing activities 964 653
Net cash flows (used in)/from financing
activities excluding dividends paid (119) (384)
Dividends paid (1 389) -
Net (decrease)/increase in cash and cash
equivalents (544) 269
Effects of exchange rate changes on cash held in
foreign currencies 7 6
Cash and cash equivalents at beginning of
period/year 2 138 493
Cash and cash equivalents at end of
period/year 1 601 768
Reviewed for Audited for
the year the year
ended ended
31 Dec 2008 31 Dec 2007
Rm Rm
Cash available from operations before taxation 3 994 1 924
Taxation received/(paid) (530) (665)
Net cash flows from operating activities 3 464 1 259
Proceeds (paid)/received from disposal of
discontinued operations 1 055 989
Net cash flows used in other investing activities (543) (600)
Net cash inflow before financing activities 3 976 1 648
Net cash flows (used in)/from financing
activities excluding dividends paid 17 (967)
Dividends paid (3 173) (446)
Net (decrease)/increase in cash and cash
equivalents 820 235
Effects of exchange rate changes on cash
held in foreign currencies 13 22
Cash and cash equivalents at beginning of
period/year 768 511
Cash and cash equivalents at end of period/year 1 601 768
Condensed Consolidated Segmental Reports
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.
Reviewed for the three months ended 31 Dec 2008
Continuing operations
Steelworks Vanadium Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 1 201 445 1 646
Intersegmental revenue 48 48
Total segment revenue 1 249 445 1 694
Reviewed for the three months ended 31 Dec 2008
Discontinued operations
Vanadium Ferro-alloys Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers - - -
Intersegmental revenue - - -
Total segment revenue - - -
Unaudited for the three months ended 31 Dec 2007
Continuing operations
Steelworks Vanadium Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 990 342 1 332
Intersegmental revenue 29 29
Total segment revenue 1 019 342 1 361
Unaudited for the three months ended 31 Dec 2007
Discontinued operations
Vanadium Ferro-alloys Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 102 123 225
Intersegmental revenue -
Total segment revenue 102 123 225
Reviewed for the year ended 31 Dec 2008
Continuing operations
Steelworks Vanadium Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 5 542 2 480 8 022
Intersegmental revenue 529 529
Total segment revenue 6 071 2 480 8 551
Reviewed for the year ended 31 Dec 2008
Discontinued operations
Vanadium Ferro-alloys Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 1 268 20 1 288
Intersegmental revenue 4 6 10
Total segment revenue 1 272 26 1 298
Audited for the year ended 31 Dec 2007
Continuing operations
Steelworks Vanadium Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 3 929 1 449 5 378
Intersegmental revenue 135 135
Total segment revenue 4 064 1 449 5 513
Audited for the year ended 31 Dec 2007
Discontinued operations
Vanadium Ferro-alloys Total
Rm Rm Rm
Revenue from the sale of goods
Revenue from external customers 957 823 1 780
Intersegmental revenue 181 97 278
Total segment revenue 1 138 920 2 058
Intersegmental revenues are eliminated
on consolidation
Reviewed for the
three months ended
31 Dec 2008
Continuing Discontinued
operations operations Total
Operating profit
Steelworks 437 437
Vanadium 178 (5) 173
Ferro-alloys 1 1
Total 615 (4) 611
Unaudited for the
three months ended
31 Dec 2007
Continuing Discontinued
operations operations Total
Operating profit
Steelworks 166 166
Vanadium 92 29 121
Ferro-alloys 71 71
Total 258 100 358
Reviewed for the year ended 31 Dec 2008
Continuing Discontinued
operations operations Total
Operating profit
Steelworks 2 096 2 096
Vanadium 973 576 1 549
Ferro-alloys 33 33
Total 3 069 609 3 678
Audited for the year ended 31 Dec 2007
Continuing Discontinued
operations operations Total
Operating profit
Steelworks 749 749
Vanadium 422 458 880
Ferro-alloys 117 117
Total 1 171 575 1 746
Reviewed as at 31 Dec 2008
Continuing Discontinued
operations operations Total
Total assets
Steelworks 4 891 4 891
Vanadium 446 446
Ferro-alloys
Total 5 337 5 337
Audited as at 31 Dec 2007
Continuing Discontinued
operations operations Total
Total assets
Steelworks 3 772 3 772
Vanadium 268 742 1 010
Ferro-alloys 142 142
Total 4 040 884 4 924
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:
Reviewed Audited
as at as at
31 Dec 2008 31 Dec 2007
Rm Rm
Cash and cash equivalents 1 601 768
Loan to joint venture - 17
Net cash 1 601 785
4. (Loss)/profit on disposal of discontinued operations
Reviewed for Unaudited for
the three the three
months ended months ended
31 Dec 2008 31 Dec 2007
Rm Rm
Total proceeds (52) -
Net asset value disposed of (97) -
(Loss)/profit on disposal before taxation (149) -
Taxation credit/(charge) 35 -
(Loss)/profit on disposal after taxation (114) -
Reviewed for Audited for
the year the year
ended ended
31 Dec 2008 31 Dec 2007
Rm Rm
Total proceeds 1 244 989
Net asset value disposed of (1 231) (417)
(Loss)/profit on disposal before taxation 13 572
Taxation credit/(charge) (86) (117)
(Loss)/profit on disposal after taxation (73) 455
5. Supplementary revenue
information - Unaudited
For the three For the three
months ended months ended
31 Dec 2008 31 Dec 2007
Sales volumes of major
products
Continuing operations
Total steel Tons 122 531 179 763
Ferrovanadium kg V 1 065 068 1 325 125
Vanadium slag Tons V2O5 3 278 3 259
Discontinued operations
Ferrovanadium and
ferrovanadium nitride kg V 582 947
Vanadium pentoxide kg V2O5 1 001 432
Vanadium chemicals kg V2O5 251 009
Weighted average selling
prices achieved
for major products
Continuing operations
Total steel $/t 914 732
Ferrovanadium $/kg V 44 36
Discontinued operations
Ferrovanadium $/kg V 34
Vanadium pentoxide $/kg V2O5 14
Vanadium chemicals $/kg V2O5 15
Average R/$ exchange rate 9.96 7.15
6. Financial ratios
Current ratio 1.93 3.84
Market capitalisation - Rm 12 890 11 254
5. Supplementary revenue information - Unaudited
For the year For the year
ended ended
31 Dec 2008 31 Dec 2007
Sales volumes of major products
Continuing operations
Total steel 668 116 730 228
Ferrovanadium 5 194 834 5 595 359
Vanadium slag 13 580 14 243
Discontinued operations
Ferrovanadium and ferrovanadium nitride 1 347 570 2 061 671
Vanadium pentoxide 2 479 734 4 276 779
Vanadium chemicals 740 442 1 300 759
Weighted average selling prices achieved
for major products
Continuing operations
Total steel 953 731
Ferrovanadium 60 37
Discontinued operations
Ferrovanadium 54 35
Vanadium pentoxide 26 15
Vanadium chemicals 23 18
Average R/$ exchange rate 8.00 7.06
6. Financial ratios
Current ratio 1.93 3.84
Market capitalisation - Rm 12 890 11 203
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 and
cash flows of these disposal groups were as follows:
Reviewed Audited
31 Dec 2008 31 Dec 2007
Rm Rm
ASSETS
Non-current assets classified as held-for-sale - 573
Current assets classified as held-for-sale - 311
- 884
EQUITY AND LIABILITIES
Liabilities directly associated with assets
classified as held-for-sale - 73
Reviewed for the Unaudited for the
three months ended three months ended
31 Dec 2008 31 Dec 2007
Rm Rm
The cash flows were as follows:
Cash inflow from operating activities - 114
Cash (outflow)/inflow from
investing activities
excluding disposal proceeds - (25)
Cash outflow from financing activities - -
Total cash inflow - 89
Reviewed for the Audited for the
year ended year ended
31 Dec 2008 31 Dec 2007
Rm Rm
The cash flows were as follows:
Cash inflow from operating activities 323 417
Cash (outflow)/inflow from
investing activities
excluding disposal proceeds 239 (117)
Cash outflow from financing activities - (66)
Total cash inflow 562 234
8. Condensed statements of changes in equity
Share Translation
capital and and other Fair value
share premium reserves reserves
Rm Rm Rm
2007
Currency translation differences 6
Net income recognised directly in equity 6 -
Profit for the period as
previously stated
Total recognised income for the period 6 -
Balance at 31 December 2006 - Audited 585 54 3
Dividends paid
Change in accounting policy
Recognition of share-based payments (7)
Balance at 30 June 2007 - Reviewed 585 53 3
Currency translation differences 17
Net income recognised directly in equity - 17 -
Profit for the quarter
Total recognised income and
expense for the period 17 -
Balance at 30 September 2007 -
Unaudited 585 70 3
Currency translation differences 24
Fair value adjustments (3)
Net income/(expense)
recognised directly in equity 24 (3)
Profit for the quarter
Total recognised income and
expense for the quarter 24 (3)
Balance at 31 December 2007 - Audited 585 94 -
First six months - 2008
Currency translation differences 64
Net income recognised directly in equity 64 -
Profit for the period
Total recognised income for the period 64 -
Balance at 31 December 2007 - Audited 585 94 -
Dividends paid
Balance at 30 June 2008 - Reviewed 585 158 -
Quarter three - 2008
Currency translation differences (13)
Net expense recognised directly in equity (13) -
Profit for the quarter
Total recognised income and
expense for the quarter (13) -
Balance at 30 June 2008 - Reviewed 585 158 -
Dividends paid
Balance at 30 September 2008 -
Unaudited 585 145 -
Quarter four - 2008
Currency translation differences 46
Net income recognised directly in equity 46 -
Profit for the quarter
Total recognised income and
expense for the quarter 46 -
Balance at 30 September 2008 -
Unaudited 585 145 -
Balance at 31 December 2008 - Reviewed 585 191 -
Retained
earnings Total
Rm Rm
2007
Currency translation differences 6
Net income recognised directly in equity - 6
Profit for the period as previously stated 643 643
Total recognised income for the period 643 649
Balance at 31 December 2006 - Audited 1 243 1 885
Dividends paid (446) (446)
Change in accounting policy 1 1
Recognition of share-based payments (7)
Balance at 30 June 2007 - Reviewed 1 441 2 082
Currency translation differences 17
Net income recognised directly in equity - 17
Profit for the quarter 314 314
Total recognised income and expense for the period 314 331
Balance at 30 September 2007 - Unaudited 1 755 2 413
Currency translation differences 24
Fair value adjustments (3)
Net income/(expense) recognised directly in equity - 21
Profit for the quarter 945 945
Total recognised income and expense for the quarter 945 966
Balance at 31 December 2007 - Audited 2 700 3 379
First six months - 2008
Currency translation differences 64
Net income recognised directly in equity - 64
Profit for the period 1 465 1 465
Total recognised income for the period 1 465 1 529
Balance at 31 December 2007 - Audited 2 700 3 379
Dividends paid (1 785) (1 785)
Balance at 30 June 2008 - Reviewed 2 380 3 123
Quarter three - 2008
Currency translation differences (13)
Net expense recognised directly in equity - (13)
Profit for the quarter 642 642
Total recognised income and expense for the quarter 642 629
Balance at 30 June 2008 - Reviewed 2 380 3 123
Dividends paid (1 388) (1 388)
Balance at 30 September 2008 - Unaudited 1 634 2 364
Quarter four - 2008
Currency translation differences 46
Net income recognised directly in equity - 46
Profit for the quarter 432 432
Total recognised income and expense for the quarter 432 478
Balance at 30 September 2008 - Unaudited 1 634 2 364
Balance at 31 December 2008 - Reviewed 2 066 2 842
9. Contingent liabilities
As required by the Mineral and Petroleum Resources Development Act, a guarantee
amounting to R191 million (2007: R176 million) was issued in favour of the
Department of Minerals and Energy for the unscheduled closure of Mapochs Mine.
In terms of the Corporation`s employment policies, certain employees could
become eligible for post retirement medical aid benefits at any time in the
future prior to their retirement subject to certain conditions. The potential
liability should they become medical scheme members in the future is R55
million (2007: R44 million).
10. Subsequent events
There has been no reportable post-balance sheet events.
Directors:
J W Campbell (Acting Chairman), W G Ballandino (Chief Executive Officer)
(Italian), G C Baizini (Italian), C B Brayshaw, A V Frolov (Russian),
G A Mannina (Swiss), B J T Shongwe, P S Tatyanin (Russian)
Company secretary:
Mrs C I Lewis
Sponsor:
J.P. Morgan
Registered office: Transfer secretaries:
Portion 93 of the farm Computershare Investor Services
Schoongezicht No. 308 JS (Proprietary) Limited
District eMalahleni 70 Marshall Street
Mpumalanga Johannesburg
PO Box 111 PO Box 61051
Witbank 1035 Marshalltown 2107
Tel: (013) 690-9911 Tel: (011) 370-5000
Fax: (013) 690-9033 Fax: (011) 688-5200
Date: 13/03/2009 13:00:01 Produced by the JSE SENS Department.
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