| Fri 30 Oct 2009, 15:01 | | JDH - John Daniel Holdings - Abridged Reviewed Provisional Financial |
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JDH
JDH
JDH - John Daniel Holdings - Abridged Reviewed Provisional Financial
Statements For the Year ended 30 June 2009
JOHN DANIEL HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration number: 1998/013215/06
JSE Code: JDH - ISIN: ZAE000044343
("the Company" or "JDH" or "the Group")
Abridged Reviewed Provisional Financial Statements For the Year ended 30
June 2009
Abridged Reviewed Balance Sheet
as at 30 June 2009
30 June 30 June 2008
2009 Audited Group
Reviewed
Group
R`000 R`000
ASSETS
Non-current assets
Property, plant and equipment 4 208 5 668
Intangible assets 1 790 1 750
Investments - -
Deferred tax 2 179 2 179
Total non-current assets 8 177 9 597
Total current assets 7 845 2 563
TOTAL ASSETS 16 022 12 160
EQUITY AND LIABILITIES
Equity (1 920) 1 690
Non-current liabilities
Interest bearing borrowings 363 -
Deferred tax 23 23
Total non-current liabilities (1 534) 23
Minority interest 490 2 238
Total current liabilities and 17 066 8 209
shareholders loans
TOTAL EQUITY AND LIABILITIES 16 022 12 160
Net asset value (1 920) 1 690
Net tangible asset value (3 710) (60)
Net asset value per share (cents) (0.024) 0.03
Net tangible asset value per share (cents) (0.055) (0.001)
Abridged Reviewed Income Statement for the period ended 30 June 2009
30 June 30 June
2009 2008
Reviewed Audited
Group Group
R`000 R`000
REVENUE 8 334 6 315
COST OF SALES (5 535) (2 988)
GROSS PROFIT 2 799 3 327
Selling, distribution and (6 860) (8 804)
administration expenses
Loss before net finance costs and tax (4 061) (5 477)
Net finance costs (1 297) (207)
Taxation income - 1 610
LOSS FOR THE YEAR (5 358) (4 074)
Attributable to minorities 1 748 1 376
Net loss attributable to ordinary (3 610) (2 698)
shareholders
(5 358) (4 074)
Basic and headline loss
Basic loss (3 610) (2 698)
Headline loss (3 250) 302
Basic loss per share (cents) (0.062) (0.046)
attributable to equity holders of the
parent
Headline (loss)/earnings per share (0.056) 0.005
(cents) attributable to equity holders
of the parent
Weighted average number of shares `000 5 851 976 5 851
976
Number of shares in issue `000 5 851 976 5 851
976
Reconciliation between basic earnings
/ (loss) and headline earnings /
(loss)
IAS 33 Basic (loss) (3 610) (2 698)
IAS 16 Profit on disposal of property, 360 -
plant and equipment
IAS 36 Impairment of investment - 3 000
Headline (loss)/earnings (3 250) 302
Abridged Segmental Information for the period ended 30 June 2009
30 June 2009 R`000 R`000 R`000 R`000
Reviewed Group
Primary segments Biotechnology Packaging Elimination Consolidated
Revenues 2 279 4 652 - 6 931
Unallocated 1 403
corporate revenue
Total external 8 334
Revenue
Segmental results (1 230) (3 039) 1 452 (2 817)
Unallocated group (2 540)
profit
Total result (5 357)
30 June 2008 R`000 R`000 R`000 R`000
Audited Group
Primary segments Biotechnology Packaging Elimination Consolidated
Revenues 2 275 2 540 - 4 815
Unallocated 1 500
corporate revenue
Total external 6 315
Revenue
Segmental results (722) (2 327) - (3 049)
Unallocated group (2 428)
profit
Total result (5 477)
Abridged Reviewed Statement of Changes in Equity for the Year Ended 30
June 2009
Capital Non Share Accumulat Minority Total
distribut option ed interest
able liability profit /
reserve (loss)
R`000 R`000 R`000
R`000 R`000
R`000
Balance as at 24 415 14 172 87 (33 202) 1 529 7 001
30 June 2008
Options - - (48) 48 - -
exercised
Profit on - 347 - - - 347
sale of
shares in
subsidiary
Changes in - (1 431) - - 2 085 654
equity
holdings of
subsidiaries
Net loss for - - - (2 698) (1 376) (4 074)
the period
Balance as at 24 415 13 089 39 (35 852) 2 238 3 928
30 June 2009
Options - - (39) 39 - -
expired
Loss for the - - - (3 610) (1 747) (5 357)
year
24 415 13 089 - (39 423) 490 (1 429)
Abridged Reviewed Cash Flow Statement for the Year Ended 30 June 2009
30 June 2009 30 June 2008
Provisional Audited Group
Group
R`000 R`000
NET CASH OUTFLOW FROM OPERATING ACTIVITIES (11 890) (680)
NET CASH INFLOW FROM INVESTING ACTIVITIES 1 755 372
NET CASH INFLOW/(OUTFLOW) FROM FINANCING 11 432 (59)
ACTIVITIES
Increase / (Decrease) in cash and cash 1 297 (367)
equivalents
Cash and cash equivalents at the beginning (958) (591)
of the year
Cash and cash equivalents at the end of the 339 (958)
year
Comments
REVIEW OF PROVISIONAL RESULTS AND FINANCIAL POSITION
The reviewed consolidated financial results for the year ended 30 June 2009
represents income from the Group`s two trading subsidiaries Vinguard
Limited ("Vinguard") and Lazaron Biotechnologies (SA) Limited ("Lazaron").
The group, excluding minorities, has shown a loss of R3.6 million.
Shareholders` attention is drawn to the fact that the bulk of this loss is
once-off and is mainly attributable to the corporate action flowing from
the transaction with Golden Oak Corporate Advisors. The group has accrued
an amount for interest on the loan of R1.2 million. Other transaction fees
including commissions and advisory fees amounted to approximately
R1 million. Going forward, these extraordinary disbursements are therefore
not reflective of the underlying operations of the group and should be
viewed in that context.
In addition to the difficult trading conditions experienced in the second
half of the year, margins also came under pressure as the Rand unexpectedly
strengthened from the beginning of the year to the end of June 2009. This
had a two pronged impact on profitability as raw materials purchased were
purchased at a more costly level and receipts there from were at a lower
exchange rate.
Group turnover is up by 32% in the period under review and it should be
noted that Vinguard turned away orders in excess of R4.5 million due to
being unable to secure adequate credit insurance as a direct result of the
global financial crisis. Shareholders will note that at year end the
stockholding of the company was in excess of R2.9 million, this mainly
representing stock that was held back and not provided for sale as a result
of the credit crunch. Trade and Other Receivables exceeded Trade and Other
Payables by R800 000 at year end.
Taking a look at the overall financial position of the group at year end,
stakeholders remain reminded that the convertible loan, together with its
interest, included in current liabilities, is not repayable by cash and
remains payable in equity. This will be dealt with under post-balance sheet
events.
OPERATIONAL REVIEW
Group Overview
JDH continues to conduct business as a venture capital investment holding
company, focusing on investing in high technology start-up companies. In
particular, these companies are required to produce products or provide
services with high barriers to entry, have clear global markets, with
minimal competition, and be strategic in nature, both in local and global
markets. Currently JDH, has two such subsidiaries i.e. Lazaron
Biotechnologies and Vinguard.
During the year under review the group as a whole was subject to various
problems created inter alia by the global financial crisis, the lack of
adequate credit cover and the general lack of credit availability. This was
largely visible in the Middle East and in particular Europe, where
exporters not only demanded longer credit terms but expected lower prices.
Vinguard Limited
Vinguard continues to solidify its position as a premium product supplier.
During the year under review it was clear that, as anticipated, orders had
grown as the product became more well known on the global table grape
market. It was unfortunate that the company could not fulfil the export
orders received, but as stated previously, the risks of exporting without
adequate credit insurance are all too well known. This risk was compounded
by the negative sentiment experienced globally during the second and third
quarter of the period under review and the company rather chose a prudent
credit risk management policy than to place the group under undue risk.
On the positive side, the company focused on developing a new ancillary
product that acts in conjunction with the SO2 sheets that the company
manufactures and assists with moisture absorption for longer storage. The
product carries all relevant food safety certification for paper that comes
into direct contact with foodstuffs and it is anticipated that this product
will receive a very good market uptake, as it is marketed together with the
Vinguard SO2 sheets. In addition to this Vinguard is currently researching
a third ancillary product.
Lazaron Biotechnologies (SA) Limited
As previously reported, and also during the year under review, Lazaron
Biotechnologies managed to maintain its market position during a period
where credit has become very difficult to obtain and expendable cash
reserves have dwindled. As competition in the market has intensified, the
company was forced to intensify its marketing efforts and to tighten up on
credit terms granted.
The company has also identified two new potential income streams and is in
discussion with two overseas groups to obtain the technology to add two
additional but related services to its existing service offering. The
challenge remains to keep the stem cell storage services offered by the
company affordable while growing its market share.
Stakeholders` attention is again drawn to the fact that Lazaron originally
anticipated a second issue of shares in order to raise further working
capital and it has again not been necessary due to the positive cash flow
of the company and it is not anticipated that the company would require
additional funds to roll out the new anticipated service offerings as the
company has most of the necessary infrastructure in place.
PROSPECTS
Looking into the future, the coming year is very much a watershed year for
the group as a whole. An extremely complex and time consuming period,
incorporating a share consolidation is now behind the group and the focus
going into the future is to achieve profitability for the consolidated
group. Both underlying subsidiaries continue to hold substantial profit
potential, and both are ready to serve their respective markets.
Indications from South African exporters of table grapes are largely
positive for the use of Vinguard SO2 sheets and the company looks forward
to the introduction of the ancillary moisture absorbent materials which are
required to be used in direct contact with foodstuffs (table grapes).
Vinguard has made an additional investment in building the manufacturing
plant to produce the new moisture absorbent pads.
POST BALANCE SHEET EVENTS
Shareholders are advised that a General Meeting of shareholders of JDH was
held on 03 August 2009 at the offices of JDH. Special Resolution Nr 1 and
Ordinary Resolutions 1 and 2 were passed by the requisite majority. Trading
in shares under the new consolidated share capital under new ISIN
ZAE000136677 therefore commenced on Monday, 14 September 2009.
The directors are also pleased to announce that Vinguard`s new moisture
absorbent pad manufacturing machine was completed and commissioned during
October.
In respect of the loan received from Golden Oak Corporate Advisors, the
conversion thereof will restore the group`s net total assets to in excess
of R9.1 million where it is currently reflected as a net liability of R1.4
million.
GOING CONCERN
The directors are of the opinion that the group will continue as a going
concern for the foreseeable future due to the continued support of related
parties to the group and in particular by the holding company to its
subsidiaries.
DIVIDENDS
No dividends have been declared and no dividend is proposed.
ACCOUNTING POLICIES
The abridged financial statements have been prepared in accordance with IAS
34 - Interim Financial Reporting in accordance with accounting policies
that comply with International Financial Reporting Standards and in the
manner required by the Companies act and the JSE listing requirements. The
principle accounting policies adopted in preparation of these financial
statements are consistent with those of the prior year.
REVIEW REPORT
These results have been reviewed by PKF (Cpt) Inc, whose unqualified review
report with an emphasis of matter is available for inspection at the
registered offices of the company. The audited results are expected to
be published by mid-November 2009. The emphasis states that, the group
Income Statement indicates a net loss of R3,6 million (2008: R2,6 million)
after Minority Interest during the financial year ended 30 June 2009 and as
of that date the group`s total liabilities exceed its total assets by R1,4
million. These conditions indicate the existence of material uncertainty
which may cast doubt on the group`s ability to continue as a going concern
unless the conditions referred to in the directors` commentary are
realised.
CAUTIONARY ANNOUNCEMENT
Shareholders are reminded of the cautionary statement published by the
group on 28 October 2009. Shareholders remain advised to exercise caution
in dealing with the company`s securities until such time as the effects on
net asset value due to the conversion of the Golden Oak Corporate Advisors
(Pty) Ltd`s loan account is known to the company and more fully reported
on. The conversion of the loan, when converted, is expected to increase the
net asset value by R10.5 million. The expected conversion price will only
be known to the company at the beginning of November 2009 and will more
fully be dealt with in subsequent SENS announcements.
For and on behalf of the Board
H Minnie
CEO
Stellenbosch
30 October 2009
Directors: S Tshiki (Non-executive Chairman), HD Minnie (CEO), NJ Ackermann
(Financial Director), T Mvusi (Non-Executive Director), S Serex (Non-
Executive Director)
Company Secretary: G Hayward
Registered Office: Infruitec Northern Terrain, Lelie Street, Stellenbosch
7600, PO Box 1243, Stellenbosch, 7599.
Transfer Secretaries: Computershare Investor Services (Pty) Ltd, 70
Marshall Street, Marshalltown 2001. PO Box 61051, Marshalltown, 2107.
Sponsor: Arcay Moela Sponsors (Pty) Ltd
Auditors: PKF (Cpt) Inc
Date: 30/10/2009 15:01:01 Produced by the JSE SENS Department.
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