| Mon 18 Jan 2010, 8:00 | | ELI - Ellies Holdings Limited - Unaudited group results for the six months ended |
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ELI
ELI
ELI - Ellies Holdings Limited - Unaudited group results for the six months ended
31 October 2009
ELLIES HOLDINGS LIMITED
(Registration number 2007/007084/06)
Share Code: ELI
ISIN: ZAE000103081
Unaudited group results for the six months ended 31 October 2009
Abridged consolidated statement of financial position
Restated unaudited
Unaudited as at as at Audited as at
31 October 2009 31 October 2008 30 April 2009
R R R
ASSETS
Non-current assets 265,591,160 247,954,459 258,468,974
Property, plant
and equipment 32,811,789 34,054,817 31,383,675
Goodwill 217,553,983 196,570,463 217,553,983
Other intangible assets 7,643,135 8,995,085 4,893,754
Deferred taxation 7,582,253 8,334,094 4,637,562
Current assets 511,686,019 521,877,368 487,895,554
Inventories 306,284,521 296,048,206 301,190,864
Trade and other
receivables 178,804,626 203,029,647 156,134,729
Taxation receivable 824,794 - 1,952,535
Other current assets - 1,029,917 897,932
Bank and cash balances 25,772,078 21,769,598 27,719,494
Total assets 777,277,179 769,831,827 746,364,528
EQUITY AND
LIABILITIES
Capital and reserves 424,733,107 361,251,965 385,683,763
Share capital and
premium 440,559,669 437,556,100 440,559,669
Non-distributable
reserves (178,447,251) (178,194,003) (178,335,326)
Retained earnings 162,620,689 101,889,868 123,459,420
Non-current
liabilities 56,446,129 99,688,509 90,369,337
Interest-bearing
liabilities 42,289,123 35,933,323 28,178,845
Vendor loans payable 12,744,162 61,116,841 60,634,835
Deferred taxation 1,412,844 2,638,345 1,555,657
Current liabilities 296,097,943 308,891,353 270,311,428
Interest-bearing
liabilities 24,678,467 21,645,727 8,394,783
Vendor loans payable 59,510,079 - 31,659,823
Trade and other
payables 130,607,729 156,279,982 130,242,536
Provisions 14,861,933 21,494,118 15,174,726
Taxation payable 17,215,554 44,042,144 3,552,974
Bank overdrafts 49,224,181 65,429,382 81,286,586
Total equity and
liabilities 777,277,179 769,831,827 746,364,528
Shares in issue
and to be issued
at end of year
(number of shares) 270,674,399 266,745,517 270,674,399
Shares in issue 270,674,399 245,713,589 246,638,901
Shares to be issued - 21,031,928 24,035,498
Net asset value
per share (cents) 156.92 147.02 156.38
Net tangible asset
value per share (cents) 76.54 67.02 68.17
Abridged consolidated statement of comprehensive income
Restated
Unaudited six unaudited
months ended six months ended Audited year ended
31 October 2009 31 October 2008 30 April 2009
R R R
Revenue 590,203,576 544,085,392 976,846,314
Profit before depreciation,
amortisation, interest
and taxation ("EBITDA") 73,945,301 82,471,741 131,409,064
Depreciation (6,515,752) (5,081,989) (10,018,633)
Amortisation of intangibles (639,330) (4,101,331) (8,202,663)
Profit before interest
and taxation 66,790,219 73,288,421
113,187,768
Net finance costs (10,695,145) (11,811,891) (23,458,279)
Net profit before
taxation ("PBT") 56,095,074 61,476,530 89,729,489
Taxation (16,933,805) (17,876,998) (24,560,405)
Net profit after taxation 39,161,269 43,599,532 65,169,084
Other comprehensive income:
Foreign currency translation
reserve (111,925) - (141,323)
Total comprehensive income
for the period 39,049,344 43,599,532 65,027,761
Supplementary information
Basic earnings per share (cents) 14.47 17.74 26.42
Headline earnings per share (cents) 14.47 17.72 26.42
Core headline earnings per
share (cents) 16.16 20.60 32.16
Diluted earnings per share (cents) 14.47 17.74 24.08
Diluted headline earnings
per share (cents) 14.47 17.72 24.08
Diluted core headline
earnings per share (cents) 16.16 20.60 29.30
Shares in issue
- at end of the period 270,674,399 245,713,589 246,638,901
- Weighted 270,674,399 245,713,589 246,638,901
- Diluted 270,674,399 245,713,589 270,674,399
Reconciliation of headline earnings and core headline earnings
Restated
Unaudited six unaudited
months ended six months ended Audited year ended
31 October 2009 31 October 2008 30 April 2009
R R R
Net profit after taxation 39,161,269 43,599,532 65,169,084
Adjusted for:
Profit on sale of property,
plant and equipment - (67,249) (4,660)
Tax effect on adjustments - 18,830 1,305
Headline earnings attributable
to ordinary shareholders 39,161,269 43,551,113 65,165,729
Adjusted for:
Amortisation of intangibles 639,330 4,101,332 8,202,663
IFRS implied interest on
vendor liabilities 4,112,763 4,119,445 8,238,889
Tax effect on adjustments (179,012) (1,148,374) (2,296,746)
Core headline earnings
attributable to ordinary
shareholders 43,734,350 50,623,516 79,310,535
Abridged consolidated statement of changes in equity
Restated
Unaudited six unaudited Audited
months ended six months ended year ended
31 October 2009 31 October 2008 30 April 2009
R R R
Balances at beginning
of the period 385,683,763 235,268,251 235,268,251
Shares issued and to
be issued at a premium - 82,384,182 85,387,751
Total comprehensive
income for the period 39,049,344 43,599,532 65,027,761
Balances at end of the period 424,733,107 361,251,965 385,683,763
Abridged consolidated cash flow statement
Restated
Unaudited six unaudited
months ended six months ended Audited year ended
31 October 2009 31 October 2008 30 April 2009
R R R
Cash flows from
operating activities 35,206,784 (10,655,960) (4,859,851)
Cash flows from
investing activities (11,332,577) (29,200,438) (31,600,918)
Cash flows from
financing activities 6,240,782 34,387,550 21,084,613
Net Increase / (decrease)incash and cash equivalents 30,114,989
(5,468,848) (15,376,156)
Cash and cash
equivalents at the
beginning of the period (53,567,092) (40,266,154) (40,266,154)
Cash acquired as part of
business combinations - 2,075,218 2,075,218
Cash and cash equivalents
at the end of the year (23,452,103) (43,659,784) (53,567,092)
Segmental analysis
Strategic Business Unit
Wholesale distribution
of consumer goods and services
Revenue PBT
R R
Unaudited six months ended 31 October 2009 472,151,806 43,035,870
Restated unaudited six months ended
31 October 2008 407,627,490 44,371,643
Audited year ended 30 April 2009 759,713,152 66,586,280
Strategic Business Unit
Infrastructural electrification
Revenue PBT
R R
Unaudited six months ended 31 October 2009 118,051,770 13,059,204
Restated unaudited six months ended
31 October 2008 136,457,902 17,104,887
Audited year ended 30 April 2009 217,133,162 23,143,209
Notes to the unaudited interim results
Basis of preparation and accounting policies
The results for the six months ended 31 October 2009 have been prepared in
accordance with International Financial Reporting Standards ("IFRS"),
specifically IAS 34 Interim Financial Reporting, and comply with the
requirements of the South African Companies Act, 1973 and the Listings
Requirements of the JSE Limited. Except for the adoption of the new and revised
accounting standards, the principle accounting policies applied by the group in
the abridged consolidated financial results for the six months ended 31 October
2009 are consistent with those applied in the consolidated financial statements
for the year ended 30 April 2009. The interim results have not been audited or
reviewed by the group`s auditors.
Comparatives
The previous reported interim results for the period ended 31 October 2008 were
restated due to the recognition and amortisation of intangible assets identified
during April 2009 when the provisionally determined fair value of assets,
liabilities and contingent liabilities acquired as a result of the acquisition
of Megatron Federal was finalised.
Introduction
Ellies Holdings Limited ("Ellies") presents its unaudited interim results for
the six months ended 31 October 2009. While recessionary conditions during
these six months made for a challenging trading period, with the group`s
margins coming under pressure, the group has held and increased market share in
its key divisions. In addition, Ellies has bedded down its first major
acquisition (of the Megatron business) and is well positioned to capitalise on
growth opportunities and increased trading as economic conditions recover.
Financial results
Ellies has 270 674 399 (2008: 245 713 589) shares in issue, the increase
resulting from issues of shares for the acquisition of Megatron.
Key indicators are as follows:
Revenue is up 8.48% to R590.2m (2008: 544.1 million). This reflects growth
in market share, which bodes well for the group`s ability to capitalise on
opportunities as conditions recover.
EBITDA is down 10.34% to R73.9 million (2008: R82.5), largely due to
pressures on margins and a comparative prior period that included the
revenue benefits of unusual volumes of generator sales resulting from
power outages.
Comprehensive income is down by 10.44% to R39m (2008: R43.6 million) and
earnings per share fell by 18.34% to 14.47 cents (2008: 17.74 cents).
Interest-bearing bank debt is down to R90.5 million (2008: R101.3 million).
Prospects
In terms of the acquisition agreement, a further amount of R65 million will
become payable by Ellies to the vendor of the Megatron business. The board has
agreed with the Megatron vendor that it will partially underwrite a rights offer
by Ellies at 200 cents per share. It is anticipated that the effect of this
underwriting commitment will be that the full amount due to the vendor will be
discharged in Ellies shares. The rights offer will strengthen the already sound
balance sheet and provide capital for current expansion programs, including the
Digital Terrestrial migration, expansion into domestic appliances, growth of
electrical ranges, and satellite-related business expected in 2010. The
underwriting commitments of the Megatron vendor positively reflect on its
confidence in the Ellies group and will enhance the alignment of its interests
with those of all shareholders. Full details of this rights offer will follow in
due course.
The newly-established Ellies Power division has a national presence and has won
a number of tenders across South Africa and beyond, demonstrating its
credibility throughout Southern Africa.
While Ellies will continue its focus in the electrical sector with the
expansion of product offerings including light commercial products, the group
intends expanding into the appliance sector, thus enhancing the offerings to
its valued existing customer base. These opportunities will create value by
diversification, economies of scale and capacity productivity.
The Elsat satellite division continued its significant contribution to the
group`s revenue and earnings. Management expects this to continue with the
entrance of additional broadcasters in the near future.
The Digital migration remains imminent, with some delay by government in its
implementation. This will see all terrestrial households convert to digital
reception. Ellies has secured the distribution rights to the Altech UEC digital
terrestrial decoders for the retail sector (see SENS announcement of 22 July
2009). This together with increased aerial sales should assure Ellies of
continued growth beyond 2014.
The group is not materially affected by volatility in the rand. Cost savings
from the relatively strong rand tend to be off-set by reduced revenue from
exports and the converse applies equally as the rand weakens.
Dividend
No interim dividend has been declared. The board will consider the declaration
of a dividend at year-end.
Appreciation
As always, we would like to thank all our staff, customers, business partners,
advisors and suppliers and most importantly our shareholders for their
continued support and faith in the group.
By order of the board
Elliot R Salkow Wayne Samson
Executive Chairman Chief Executive Officer
Michael Levitt
Chief Financial Officer
18 January 2010
Ellies Holdings Limited
(Registration number. 2007/007084/06)
Share code: ELI
ISIN: ZAE000103081
Directors:
Executive Directors Non-executive Directors
ER Salkow (Chairman) AC Brooking
WMG Samson (CEO) MR Goodford
MF Levitt (CFO) MS Mazwi
RH Berkman
RE Otto
Registered office
94 Eloff Street Ext, Village Deep
Johannesburg, 2001
(PO Box 57076, Springfield, 2137)
Designated advisor
Java Capital (Pty) Limited
2nd Floor, 2 Arnold Road, Rosebank, 2196
(PO Box 2087, Parklands, 2121)
Company secretary
Probity Business Services (Pty) Limited
3rd Floor, JHI House, Cradock Avenue, Rosebank, 2196
(PO Box 85392, Emmarentia, 2029)
Transfer secretaries
Link Market Services South Africa Limited
5th Floor, 11 Diagonal Street, Johannesburg, 2001
(PO Box 4844, Johannesburg, 2000)
Date: 18/01/2010 08:00:01 Produced by the JSE SENS Department.
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