| Wed 4 Nov 2009, 16:50 | | TWP - TWP Holdings - Reviewed consolidated interim results for the 6 months |
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TWP
TWP
TWP - TWP Holdings - Reviewed consolidated interim results for the 6 months
ended 31 August 2009
TWP HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2003/025640/06)
ISIN Number: ZAE000110763 Share Code: TWP
Reviewed consolidated interim results for the 6 months ended 31 August 2009
Highlights
Revenue R485.4 million
Pre-tax profit R15.8 million
Headline earnings 7.7 cents
Summarised consolidated income statement
Reviewed Audited Reviewed
6 months 12 months 6 months
ended ended ended
31 August 28 February 31 August
2009 2009 2008
R`000 R`000 R`000
Revenue 485 357 1 250 530 515 687
Cost of sales (331 908) (744 065) (348 313)
Gross profit 153 449 506 465 167 374
Net operating expenses (139 084) (345 840) (79 040)
Operating profit 14 365 160 625 88 334
Finance income 3 755 12 402 4 948
Finance costs (2 297) (4 435) (1 354)
Profit before income taxes 15 823 168 592 91 928
Income tax expense (6 591) (52 006) (26 987)
Net profit for the year 9 232 116 586 64 941
Net profit for the period
attributable to:
Equity shareholders of
the parent company 9 244 116 936 64 917
Minority shareholders (12) (350) 24
Net profit for the year 9 232 116 586 64 941
cents cents cents
Basic earnings per share 7.75 100.06 56.71
Diluted earnings per share 7.75 100.06 56.71
Basic headline earnings per share 7.70 102.23 56.55
Diluted headline earnings per share 7.70 102.23 56.55
Summarised consolidated statement of financial position
Reviewed Audited Reviewed
31 August 28 February 31 August
2009 2009 2008
R`000 R`000 R`000
ASSETS
Non-current assets
Property, plant and equipment 85 941 104 182 86 178
Intangible assets
(including goodwill) 215 800 227 133 163 130
Available-for-sale financial
assets 7 613 3 807 6 335
Loans to related companies 1 454 2 1 258
Deferred taxation 13 213 4 434 1 752
324 021 339 558 258 653
Current assets
Inventory 5 604 1 309 -
Trade and other receivables 227 037 275 585 284 370
Work in progress 127 032 80 192 51 372
Available-for-sale financial assets 4 121 4 013 47 496
Cash and cash equivalents 36 830 51 095 51 625
Taxation 3 374 1 281 -
403 998 413 475 434 863
Total assets 728 019 753 033 693 516
SHAREHOLDERS` EQUITY
Share capital and premium 286 053 285 529 283 891
Other reserves (15 158) (20 142) (19 341)
Retained earnings 268 803 271 529 219 510
539 698 536 916 484 060
Minority interest 49 48 376
539 747 536 964 484 436
LIABILITIES
Non-current liabilities
Deferred taxation 38 427 24 296 14 089
Long-term liabilities 13 367 15 275 5 228
51 794 39 571 19 317
Current liabilities
Trade and other payables 102 236 122 538 106 432
Deferred revenue - - 8 568
Short-term portion of
long-term liabilities 9 259 8 716 4 109
Bank overdraft 8 593 137 6 902
Taxation 16 390 45 107 63 752
136 478 176 498 189 763
Total equity and liabilities 728 019 753 033 693 516
Summarised consolidated statement of comprehensive income
Reviewed Audited Reviewed
6 months 12 months 6 months
ended ended ended
31 August 28 February 31 August
2009 2009 2008
R`000 R`000 R`000
Net profit for the year 9 232 116 586 64 941
Other comprehensive income
for the period, net of tax 3 803 (8 533) (6 372)
Disposal of subsidiaries - (1 393) (1 393)
Movement in fair value of
available-for-sale financial assets 3 956 (7 318) (4 789)
Translation of foreign subsidiaries (153) 178 (190)
Total comprehensive income
for the period 13 035 108 053 58 569
Total comprehensive income for
the period attributable to
the following:
Equity shareholders of
the company 13 034 109 774 59 962
Minority interest 1 (1 721) (1 393)
Total comprehensive income
for the period 13 035 108 053 58 569
Summarised consolidated statement of cash flow
Reviewed Audited Reviewed
6 months 12 months 6 months
ended ended ended
31 August 28 February 31 August
2009 2009 2008
R`000 R`000 R`000
Cash flow from operating activities (14 352) 117 759 67 230
Cash flow from investing activities (6 379) (124 183) (91 564)
Cash flow from financing activities (1 865) (21 620) (9 577)
Cash and cash equivalents
- movement for the period (22 569) (28 044) (33 911)
Cash and cash equivalents
- beginning of the period 50 958 78 824 78 824
Exchange difference on
translation of foreign operations (152) 178 (190)
Cash and cash equivalents
- end of period 28 237 50 958 44 723
Statement of changes in equity
Share
capital
and Other Retained Minority
premium reserves earnings interest Total
R`000 R`000 R`000 R`000 R`000
Balance at 29
February 2008 190 391 (14 987) 154 593 1 769 331 766
Own shares acquired (10 992) - - - (10 992)
Share incentive
scheme accrued - 2 007 - - 2 007
Shares issued on
acquisition of
subsidiary 106 130 - - - 106 130
Total comprehensive
income for the
period - (7 162) 116 936 (1 721) 108 053
Balance at 28
February 2009 285 529 (20 142) 271 529 48 536 964
Share incentive
scheme accrued - 1 193 - - 1 193
Total comprehensive
income for the
period - 3 791 9 243 1 13 035
Shares issued in
terms of share
incentive scheme 524 - - - 524
Dividend declared - - (11 969) - (11 969)
Balance at 31
August 2009 286 053 (15 158) 268 803 49 539 747
Segmental information
Geographical segments
South
African Australian Intersegment
operations operations eliminations Total
6 months ended 31
August 2009 R`000 R`000 R`000 R`000
Revenue 484 579 778 - 485 357
Operating profit 27 951 (13 586) - 14 365
Total assets 736 760 16 366 (25 107) 728 019
Total liabilities (183 473) (29 900) 25 102 (188 272)
Net assets 553 286 (13 534) (5) 539 747
Capital expenditure (5 583) - - (5 583)
Depreciation (19 854) (3 145) - (22 999)
12 months ended 28
February 2009
Revenue 1 140 988 117 346 (7 804) 1 250 530
Operating profit 165 567 (4 942) - 160 625
Total assets 746 840 26 201 (20 008) 753 033
Total liabilities (206 974) (29 098) 20 003 (216 069)
Net assets 539 866 (2 897) (5) 536 964
Capital expenditure (78 256) (14 629) - (92 885)
Depreciation (27 976) (3 997) - (31 973)
Notes to the consolidated financial information
Basis of preparation
These condensed consolidated financial statements have been prepared on the
historical cost basis, except for financial instruments that are fair valued, in
accordance with the group`s accounting policies which are consistent with those
adopted in the financial year ended 28 February 2009 and which are compliant
with International Financial Reporting Standards ("IFRS") and in accordance with
IAS 34: "Interim Financial Reporting", the South African Companies Act, 1973, as
amended, and the JSE Listings Requirements.
Audit review opinion
These financial results have been reviewed by the group`s auditors,
PricewaterhouseCoopers Inc., and their unqualified review opinion is available
for inspection at the company`s registered office.
Earnings and headline earnings per share
Reviewed Audited Reviewed
31 August 28 February 31 August
2009 2009 2008
Basic earnings per share
Basic earnings per share (cents) 7.75 100.06 56.71
is calculated based on net
profit for the period of (R`000) 9 244 116 936 64 917
and a weighted average number
(`000) of shares outstanding of 119 274 116 861 114 467
Headline earnings per share
Headline earnings per share (cents) 7.70 102.23 56.55
is calculated based on profit
for the period of (R`000) 9 189 119 467 64 731
and a weighted average number
(`000) of shares outstanding of 119 274 116 861 114 467
Diluted basic earnings per share
The company currently has no
potential equity instruments with a
a dilutive effect.
Reconciliation of basic and
headline earnings for the period
Net profit for the period (R`000) 9 244 116 936 64 917
Profit after tax on the disposal of
fixed assets (R`000) (55) 2 606 (111)
Profit after tax on the disposal
of investment (R`000) - (76) (75)
Headline earnings for the
period (R`000) 9 189 119 467 64 731
Financial results and review of operations
Revenue decreased marginally by 6% to R485 million compared to the corresponding
period in the previous year. Headline earnings decreased by 86% to 7.7 cents per
share.
TWP`s core operations have been adversely affected by the significant slowdown
in capital expenditure experienced in the mining industry. The first six months
of the year have seen clients cutting back existing capital expenditure
programmes and reluctant to commit to new projects. This has been particularly
noticeable on process plant projects. Mining projects have also been affected,
although to a somewhat lesser extent.
TWP responded to the downturn by making savings wherever possible and
retrenching non-core staff. The costs associated with this process have largely
been accounted for in this period. Five of TWP`s existing offices have now been
consolidated into one larger facility and the benefits of this move should start
to be felt in the second half of the year. TWP has maintained its policy of
retaining staff, even if at the expense of current profits, in order to better
take advantage of any upturn in trading conditions in the future.
Business conditions in the Australian market have been extremely difficult and
the Perth office has been cut back to a core team.
Prospects
Notwithstanding the above, the last few months have seen some "green shoots"
emerging and the level of enquiries for new projects has definitely improved.
Staff utilisation rates have steadily risen along with higher metal prices. Any
improvement in sentiment has been negatively affected in the South African
context at least, by a much stronger local currency. The balance of the
financial year is expected to be characterised by continued tough trading
conditions; however the steps taken by management to improve utilisation and
margins should start to be felt towards the end of the year.
On a go-forward basis, TWP is pursuing its medium to long-term objectives of
adding to its product offerings as well as taking equity in selected projects.
Business acquisitions
The proposed acquisition of TWP by Basil Read is proceeding according to the
timetable published on 30 September 2009 in the scheme of arrangement document.
The scheme meeting will be held at 9:00 on 17 November 2009 at TWP`s offices, 54
Melrose Boulevard, Melrose Arch, Johannesburg. Should the necessary
shareholders` agreement be reached, it is planned that TWP will
de-list from the JSE on Monday 21 December, 2009.
On behalf of the board
E Dube N Townshend S Dewsbery
Chairman Chief executive officer Chief financial officer
4 November 2009
Johannesburg
TWP Holdings Limited
Registration number: 2003/025640/06
Share code: TWP
ISIN: ZAE000110763
Directors: E Dube* (Chairman), A Lawless*, H Makupula*, N Townshend (CEO), S
Dewsbery (CFO) *Non-executive
Registered address: Level 1, 54 Melrose Boulevard, Melrose Arch, Melrose,
Johannesburg, 2196. PO Box 61232, Marshalltown 2107
Company secretary: T Liebenberg, Legal Information Services (Pty) Limited
Registration number: 2008/028843/07
Cnr Republic and Main Avenue, Ferndale, Randburg.
Tel: +27 (11) 326 1330, Fax: +27 (11) 787 5643.
Email: Theunis@lisinfo.co.za
Transfer secretaries: Computershare Investor Services (Pty) Limited
70 Marshall Street, Johannesburg 2001. PO Box 61051 Marshalltown 2107
Tel: +27 (11) 370 5000
Sponsor: Nedbank Capital
Auditors: PricewaterhouseCoopers Inc
Bankers: FNB Limited
Attorneys: TLi Incorporated
www.twp.co.za
Date: 04/11/2009 16:50:31 Produced by the JSE SENS Department.
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