| Wed 27 May 2009, 13:25 | | ISB - Insimbi - Press announcements: Stellar results from Insimbi |
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ISB
ISB
ISB - Insimbi - Press announcements: Stellar results from Insimbi
Insimbi Refractory and Alloy Supplies Limited
Formerly Insimbi Alloy Supplies (Proprietary) Limited
(Registration number 2002/029821/06)
JSE share code: ISB ISIN Number: ZAE000116828
("Insimbi" or "the group")
STELLAR RESULTS FROM INSIMBI
Monday, 26 May 2009: AltX listed Insimbi Refractory and Alloy Supplies Ltd
(Insimbi) today announced their annual results for the year ending 28 February
2009. "In these, our first full year results since listing, we are pleased with
the outstanding performance shown in almost all areas of the business,
especially given the challenging trading conditions," said CEO, Pieter Schutte.
Financial highlights:
Revenue increased by 8% to R969m
Profit before Tax increased by 69% to R76m
HEPS increased by 143% to 20.94 cents
Net cash increased 391% to R34m
NAV per share increased 2,161% to 35.4 cents per share
Maiden Interim Dividend of 4 cents per share declared in September 2008
Proposed Final Dividend of 5 cents per share
Record profits were achieved in the first half of the year with volumes soaring
before commodity prices came under pressure in the third quarter of the year.
Insimbi nonetheless managed to maintain margins during this period by proactive
marketing and purchasing strategies as well as exercising strong working capital
and cashflow management.
"Unbelievably, given the current environment, this is the best set of results
that Insimbi has produced in its 40 year history. It is truly a testament to our
resilience, not to mention our future potential," said Schutte
Schutte attributed the company`s performance to the initially high commodity
prices and continued focus on infrastructure development. A weaker currency
also provided additional revenues and margin boosts.
Almost all divisions of Insimbi performed well, with exceptional performance in
the Rotary and Steel Divisions.
The Rotary Division benefited largely from the current high demand in cement.
All rotary kilns installed in the country were operating at full capacity
throughout the year. The Steel division benefited from a weaker Rand, high
commodity prices and demand for finished steel products as a result of the
current and continuing upgrade of infrastructure and the boom in construction.
During the year the company added a new division and a foreign subsidiary to its
stable i.e. the Cape Town division and Insimbi Refractory and Alloy Supplies
(Zambia) Pty Ltd. The Cape Town division came about as a result of the purchase
of 100% of Global Material South Africa whilst the Zambian operation was
launched to focus on the activities in Zambia and the DRC.
"Insimbi`s strong cash generating ability enables us to take advantage of
opportunities as and when they arise. Further prospects have become apparent in
various areas of the business which we hope to benefit from in the future. We
have a firm strategy in place on where we intend to grow the business," said
Schutte
The new aluminum plant, which initially experienced a few difficulties, came
into operation in June 2008. This delay was mainly due to an upgrade of the
plant that consisted of a substantial rehabilitation as well as the introduction
of additional furnaces and fuel sources. The delays in production will however
pay dividends in the medium to long term as the process of rehabilitation
increased the expected capacity of the plant by 30%.
Prospects for Insimbi remain excellent, its diversified business model has added
stability to earnings and management are very optimistic about the year to come.
-ENDS-
Insimbi Refractory & Alloy Supplies Limited ticker: "ISB"
Website: www.insimbi-alloys.co.za
Further enquiries please contact:
Insimbi 011 902 6930
Pieter Schutte Insimbi 082 492 4662
Fred Botha Insimbi 082 578 0425
ChilliBush Investor Relations 011 646 7152
Michelle Doyle 082 784 1814
Notes to editors:
Metallurg South Africa was founded in 1970 by the previous shareholder,
Metallurg Europe Limited, a 100% subsidiary of Metallurg Incorporated.
Initially, Metallurg South Africa`s offices were located in the centre of
Johannesburg and warehousing was rented from Freight Services (Proprietary)
Limited. In 1992, the operation was moved to its current premises in Wadeville.
The Wadeville premises, which comprises approximately 9 000 m2 of offices and
warehousing facilities are wholly-owned by Insimbi Properties.
During the second half of 2003, the management of Metallurg South Africa entered
into the first phase MBO with Metallurg South Africa. The first phase MBO
received financial backing from Corfin, Corvest, and Tandem in the form of the
sale shares, preference shares, Corvest claims, loan agreement and Tandem
claims. Following the first phase MBO, Corfin, Corvest and Tandem effectively
owned 67% of the company and the director shareholders and Langham Carter owned
an effective 33%.
In order to highlight the company`s new ownership, the director shareholders,
Langham Carter, Corfin, Corvest and Tandem, decided to rebrand the company as
Insimbi Alloy Supplies (Proprietary) Limited.
Over the years, the core business of Insimbi expanded and today the company
operates eight divisions and one subsidiary which are based on industries and
geographic locations, as follows:
* Refractory Division which services the steel industry`s refractory
requirements;
* Speciality Division which services the welding and optical industries;
* Steel Division which services the steel industry`s raw material
requirements;
* Foundry Division which services the foundry industry, both automotive and
heavy;
* Non-Ferrous Division which services the aluminium industry;
* Rotary Division which services the cement industry`s refractory and
mechanical maintenance requirements; and
* KwaZulu-Natal Division which services the KwaZulu-Natal and Mozambique
markets in all of the above products.
* Cape Town Division which evolved out of the acquisition of Insimbi`s long
serving agent in Cape Town effective 1st March 2009. This acquisition
included land and buildings to the value of R6.0 million and this division
now services the Western Cape in all of the products above
* Insimbi Refractory and Alloy Supplies (Zambia) Pty Ltd which rents
warehousing in Kitwe on the Zambian Copperbelt and which services the
Zambian and DRC requirements (specific focus on the Katanga Province and
Lubumbashi in particular) in all the above products
The expansion of Insimbi`s core business has resulted in the strengthening of
the company`s technical back up and product ranges into the following major
manufacturing industries:
* iron and steel;
* ferrous and non-ferrous;
* aluminium smelters;
* foundries;
* copper mining;
* paper mills;
* sugar mills; and
* electro platers
Insimbi also caters for the small niche suppliers and markets and has over time
diversified into a number of different product lines and fields, namely:
* ceramic bricks/linings;
* aluminium alloy;
* chemicals;
* technical textiles; and
* kiln re-alignment and mechanical preventative services
In April 2007, the director shareholders of Insimbi entered into the second
phase MBO whereby the shareholding and funding of Insimbi was further
restructured with the intention that, following the second phase MBO, the entire
shareholding of the company would be held by the director shareholders.
Insimbi was converted from a private company to a public company on 12 February
2008.
On 27 January 2008, Insimbi Alloy Supplies acquired the plant and equipment,
furniture and fittings and computers used by Future Alloys to conduct its
aluminium alloys business for a purchase consideration of R17.0 million. Future
Alloys manufactures aluminium alloys with its primary focus being on the
production of the ADC12 grade of alloy. The business complements that of Insimbi
Alloy Supplies and its smelting plant currently has excess capacity. The
acquisition allows Insimbi Alloy Supplies to make use of Future Alloys` existing
manufacturing facilities, while also offering Insimbi access to greater
capacity.
Insimbi listed on AltX on 14 March 2008. R48m was raised during the private
placement.
Sponsor
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
Date: 27/05/2009 13:25:06 Produced by the JSE SENS Department.
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