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IDQ
IDQ
IDQ - Indequity Group Limited - Unaudited condensed consolidated interim results
for the six months ended 31 March 2009
Indequity Group Limited
Incorporated in the Republic of South Africa
Registration number: 1998/015883/06
Share Code: IDQ
ISIN: ZAE000016606
("Indequity" or "the Group")
UNAUDITED CONDENSED CONSOLIDATED INTERIM RESULTS FOR THE SIX
MONTHS
ENDED 31 MARCH 2009
CONDENSED CONSOLIDATED INTERIM BALANCE SHEET
31 March 31 30
2009 March September
Unaudited 2008 2008
R`000 Unaudited Audited
R`000 R`000
ASSETS
Property and equipment 511 223 618
Intangible assets 1 530 934 1 234
Investments at fair
value through profit 3 932 12 787 7 862
and loss
Loans receivable 352 - 292
Subrogation and salvage
recoveries 2 164 1 025 2 493
Deferred tax asset 769 1 989 958
Trade and other 737 580 384
receivables
Cash and cash 10 881 8 242 7 471
equivalents
Total assets 20 876 25 780 21 312
LIABILITIES
Deferred tax liability 48 1 706 736
Loans payable 1 361 781 1 393
Preference
shareholder`s interest - 232 57
Insurance contract
provisions 2 905 3 207 3 483
Tax payable 563 509 184
Dividends payable 3 36 3
Trade and other 3 767 3 772 3 074
payables
Total liabilities 8 647 10 243 8 930
EQUITY
Share capital and 14 098 14 163 14 183
premium
Contingency reserve 2 379 1 909 2 206
Accumulated loss (8 517) (5 690) (8 488)
Shareholders` interest 7 960 10 382 7 901
Minority interest 4 269 5 155 4 481
Total equity 12 229 15 537 12 382
Total equity and
liabilities 20 876 25 780 21 312
CONDENSED CONSOLIDATED INTERIM INCOME STATEMENT
6 months 6 months Year ended
ended 31 ended 31 30
March March September
2009 2008 2008
Unaudited Unaudited Audited
R`000 R`000 R`000
Insurance income 12 129 10 390 22 146
Investment income 1 227 1 924 3 516
Investment banking and private
equity income 890 (4 389) (7 548)
Total revenue 14 246 7 925 18 114
Claims incurred, net of 7 907 7 792 14 009
reinsurance
Commission paid 962 915 1 938
Operating expenses 5 281 4 636 9 827
Total expenses 14 150 13 343 25 774
Finance costs 62 89 161
Profit/(Loss) before taxation 34 (5 507) (7 821)
Taxation (225) 2 240 1 932
Loss for the period (191) (3 267) (5 889)
Attributable to:
Equity holders of the 144 (3 272) (5 773)
parent
Minority interest (335) 5 (116)
Loss for the period (191) (3 267) (5 889)
Ordinary dividends per share
(cents)
- paid - - -
- declared - - -
Basic earnings per share 1,20 (27,02) (47,48)
(cents)
Diluted earnings per share 1,20 (27,02) (47,48)
(cents)
CONDENSED CONSOLIDATED INTERIM CASH FLOW STATEMENT
31 March 31 March 30
2009 2008 September
Unaudite Unaudite 2008
d d Audited
R`000 R`000 R`000
Net cash used in operating activities (142) (1 476) (2 154)
Net cash from investing activities 3 519 5 060 5 125
Net cash from /(used in) financing 33 (2 415) (2 573)
activities
Net increase in cash and cash equivalents 3 410 1 169 398
Cash and cash equivalents at beginning of
period 7 471 7 073 7 073
Cash and cash equivalents at end of period 10 881 8 242 7 471
CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY
Share Accumulated Contingency Minority
capital
and loss reserve Interest Total
premium
R`000 R`000 R`000 R`000 R`000
Balance as at 1
October 2007 14 644 (175) 1 566 5 804 21 839
Net (loss)/profit
for the 6 months (3 272) 5 (3
ended 31 March 2008 267)
Transfer to
contingency reserve (343) 343 -
Treasury shares 42 42
sold
Treasury shares (523) (523)
acquired
Preference share (635) (635)
loss
Redemption of share
capital (19) (19)
Dividend paid (1 900) (1
900)
Balance as at 31
March 2008 14 163 (5 690) 1 909 5 155 15 537
Net loss for the 6
months ended 30 (2 501) (121) (2
September 2008 622)
Transfer to
contingency reserve (297) 297 -
Treasury shares 20 20
acquired
Preference share (550) (550)
loss
Redemption of share
capital (3) (3)
Balance as at 30
September 2008 14 183 (8 488) 2 206 4 481 12 382
Net profit/(loss)
for the 6 months 144 (335) (191)
ended 31 March 2009
Transfer to
contingency reserve (173) 173 -
Treasury shares (176) (176)
acquired
Incentive shares 91 91
issued
Preference share 123 123
profit
Balance as at 31
March 2009 14 098 (8 517) 2 379 4 269 12 229
SEGMENT INFORMATION
6 months ended 6 months Year ended
ended
31 March 2009 31 March 30 September
2008 2008
Unaudited Unaudited Audited
R`000 R`000 R`000
Insurance 12 589 10 866 22 825
Investments 772 1 465 2 872
Investment banking and
private equity 885 (4 406) (7 583)
Segment revenue 14 246 7 925 18 114
Insurance 218 176 720
Profit/(Loss) before 392 (892) 729
taxation
Taxation (174) 1 068 (9)
Investments (210) 147 11
(Loss)/Profit before taxation (601) 150 (117)
Taxation 56 2 12
Minority interest 335 (5) 116
Investment Banking and 136 (3 595) (6 504)
Private Equity
Profit/(Loss) before taxation 243 (4 765) (8 433)
Taxation (107) 1 170 1 929
Segment results 144 (3 272) (5 773)
COMMENTS ON RESULTS
The Indequity group has made significant progress in restructuring its
operations during the past 6 months. The remainder of the investment held in
African Brick Centre Ltd has been liquidated. The proceeds from this investment
has been the main contributor to the increase in Cash and cash equivalents in
the Balance Sheet to a very healthy R10,8 million. The remaining operations in
the group are of a much more stable nature and management therefore expect that
a more stable income pattern will be reflected in future financial results.
Even though the group has made a loss for the period under review, there are
certain segments that show particular promise. The insurance operations
continued to grow, with the quality of the book of business amongst the best in
the industry. Unfortunately the Investment segment suffered during this period
as assets under management decreased in line with significant downward share
price movements experienced in the equity markets. In the Investment Banking
and Private Equity segment no investment banking transactions were pursued
during the period, with only the private equity investment in Alexecovet
contributing to the results.
PROSPECTS
The group will continue to explore ways to improve the stability and quality of
its financial results. Insurance operations will be the primary driver of
growth and in future all surplus resources will be allocated to this segment.
The asset management`s operations will take time to recover as management
expects the prevailing financial crises to continue for the immediate future.
Even though highly profitable, the group will refrain from focusing on
investment banking transactions as the volatility in earnings from these
operations are no longer in line with the group`s current business model of
growing stable annuity income sources.
HEADLINE EARNINGS PER SHARE AND DILUTED HEADLINE EARNINGS PER SHARE
6 months 6 months Year ended
ended 31 ended 31 30 September
March 2009 March 2008 2008
Unaudited Unaudited Audited
Headline earnings per share 1,20 (27,02) (47,48)
(cents)
Diluted headline earnings per 1,20 (27,02) (47,48)
share (cents)
Number of shares
- in issue 13 170 000 13 170 000 13 170 000
- weighted average 12 010 567 12 106 464 12 160 203
- diluted 12 010 567 12 106 464 12 160 203
The number of shares has been used in the calculation of earnings per share,
diluted earnings per share and headline earnings per share.
ACCOUNTING POLICIES AND BASIS OF PREPARATION
The condensed interim financial statements for the six months ended 31 March
2009 were prepared in accordance with the recognition, measurement, presentation
and disclosure requirements of International Financial Reporting Standards
("IFRSs") for interim financial statements, IAS 34 - Interim Financial Reporting
and in compliance with the Listing Requirements of the JSE Limited. The
accounting policies applied in the preparation of these financial statements are
consistent with those used in the annual financial statements for the year ended
30 September 2008.
The condensed interim financial statements do not include all of the information
required by IFRS for full annual financial statements.
The financial information has been prepared in accordance with IFRSs that are
currently effective. This may differ from IFRS finally in effect at 30 September
2009 as a result of ongoing global developments and possible amendment by
interpretive guidance from the International Financial Reporting Interpretations
Committee of International Accounting Standards Board.
DIVIDENDS
In accordance with the Group`s insurance operations` current cash requirements,
no interim dividends have been declared to ordinary shareholders.
On behalf of the board
LJ van Rensburg TC Meyer Johannesburg
Chief Executive Officer Chairman 8 May 2009
Directors: LJ van Rensburg, TC Meyer, JF Zwarts*, G Williamson*, AV van
Jaarsveldt* (British) (*non-executive) Company secretary: S le Roux Transfer
secretaries: Link Market Services South Africa(Pty) Ltd Sponsor: KPMG Services
(Pty) Ltd Registered address: First Floor, Cascade House, Constantia Office
Park, cnr 14th Avenue and Hendrik Potgieter Road, Constantia Kloof, 1709 Postal
address: PO Box 5433, Weltevredenpark, 1715 Telephone: (+27 11) 475-0816 Fax:
(+27 11) 475-0877
Date: 08/05/2009 17:15:01 Produced by the JSE SENS Department.
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