| Mon 22 Feb 2010, 9:00 | | OLG - OneLogix Group - Unaudited condensed interim financial results for the six |
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OLG
OLG
OLG - OneLogix Group - Unaudited condensed interim financial results for the six
months ended 30 November 2009
OneLogix Group Limited
(Registration number 1998/004519/06)
Share Code: OLG & ISIN Code: ZAE000026399
("OneLogix" or "the group")
Unaudited condensed interim financial results for the six months ended 30
November 2009
Highlights
- NAV up 12%
- NTAV up 7%
- Capital distribution of 3 cents per share
The directors of OneLogix are pleased to present the unaudited condensed interim
financial results for the six months ended 30 November 2009 ("the interim
period").
Basis of preparation
The unaudited condensed consolidated interim financial statements have been
prepared in accordance with International Accounting Standard (IAS) 34 `Interim
financial reporting`, and the Companies Act (Act 61 of 1973), as amended. The
unaudited condensed consolidated interim financial information should be read in
conjunction with the most recent audited annual financial statements for the
year ended 31 May 2009 ("the annual financial statements"), which have been
prepared in accordance with International Financial Reporting Standards
(`IFRS`).
These condensed interim financial statements have not been audited or reviewed
by PricewaterhouseCoopers Inc.
Accounting policies
Save as set out below, the accounting policies and methods of measurement and
recognition applied in preparation of the unaudited condensed consolidated
interim financial statements are consistent with those applied and set out in
the annual financial statements.
Taxes on income in the interim period are accrued using the tax rate that would
be applicable to expected annual earnings.
The following new Standards and amendments to Standards are mandatory for the
first time for the financial year beginning 1 June 2009:
- IAS 1 (revised), `Presentation of financial statements`: The revised
Standard prohibits the presentation of items of income and expenses (that
is `non-owner changes in equity`) in the statement of changes in equity,
requiring `non-owner changes in equity` to be presented separately from
owner changes in equity. All `non-owner changes in equity` are required to
be shown in a performance statement.
Entities can choose whether to present one performance statement (the
statement of comprehensive income) or two statements (the income statement
and statement of comprehensive income).
The group has elected to present one statement of comprehensive income. The
unaudited condensed consolidated interim financial statements have been
prepared under the revised disclosure requirements.
- IFRS 8, `Operating segments`: IFRS 8 replaces IAS 14, `Segment reporting`.
It requires a `management approach` under which segment information is
presented on the same basis as that used for internal reporting purposes.
This has resulted in an increase in the number of reportable segments
presented, as the previously reported Logistics segment has been split into
Automotive and Abnormal, Media, Retail and Rail (discontinued operations)
segments. The previously reported Services segment has been renamed the
Retail segment.
Operating segments are reported in a manner consistent with the internal
reporting provided to the chief operating decision-maker. The chief
operating decision-maker has been identified as the executive committee
that makes strategic decisions.
Goodwill is allocated by management to groups of cash-generating units on a
segment level. The change in reportable segments has not resulted in any
additional goodwill impairment. Comparatives for the prior periods have
been restated.
Review of operations
Notwithstanding a recessionary economic environment in the second half of 2009,
without exception, each of the OneLogix businesses achieved strong organic
growth compared to the previous six months to May 2009. This clearly reflects
the resilience of the group`s product offerings, the capability of management
and staff and established loyal customer relationships.
In particular Vehicle Delivery Services ("VDS") shone during the interim period.
VDS has established a compelling advantage in a severely depressed industry,
managing to grow market share through industry consolidation. This, together
with a host of management initiatives, ensured a healthy performance despite the
continued contraction of the vehicle delivery market and leaves VDS well
positioned to take advantage of any uptick in the industry.
Commercial Vehicle Delivery Services ("CVDS") performed credibly, also in the
face of a continually shrinking market. The customer base remained solid and
CVDS will continue to broaden this going forward.
Pleasingly RFB Logistics ("RFB"), which contributed to earnings for the first
time in June 2009, outperformed expectations despite difficult market
circumstances. RFB has a strong foothold in its market and guided by competent
management, has promising growth potential.
The sought after national franchised chain of 226 business service outlets,
Postnet, was again the group`s best performer in terms of consistent profit
growth. Operating in the thriving SME market, it has sustained its superior
margins and remains a defensive asset for OneLogix with good growth prospects.
Media Express performed well in poor market conditions and improved operating
margins, which should continue into the future.
Also performing well, Press Support will continue to exploit new opportunities
to maintain its hard-won organic growth.
Magscene has emerged stronger following the successful resolution of operational
and administrative issues. The business has returned to profitability,
underpinned by positive cash flows during the interim period.
Acquisition
As previously announced on 3 December 2009 OneLogix has acquired Atlas
Panelbeaters, a business specialising in larger commercial vehicles, in a
further move to develop niche offerings and boost revenue as well as promote
integration with cost saving benefits for the group. Contribution to earnings is
expected from 1 January 2010 and OneLogix is excited about the business`s
potential.
The assets and liabilities arising from the acquisition are as follows:
Provisional
fair value
Property 5 400
Plant and equipment 1 400
Inventories 3 200
Net identifiable assets acquired 10 000
Cash flow on acquisition (1 186)
Purchase funded by bond over fixed property (4 214)
Purchase funded by vendor liability (4 600)
Total funding (10 000)
Outflow of cash to acquire business:
- cash consideration 1 186
Cash outflow on acquisition 1 186
Discontinued operations
As previously announced on 21 August 2009 OneLogix has disposed of its interests
in the 4Logix and Gijima businesses with effect from 1 June 2009.
Financial information relating to the 4Logix and Gijima operations for the
interim period to the date of disposal is set out below. The income statement
and the cash flow statement distinguish discontinued operations from continuing
operations. Comparative figures have been restated.
Income statement information
Unaudited Unaudited Audited
Six Six months Year
months
ended ended ended
30 30 November 31 May
November
2009 2008 2009
R`000 R`000 R`000
Revenue - 49 595 90 775
Operating and administration costs (19) (47 608) (87 507)
Earnings before interest, taxation
depreciation and amortisation
(EBITDA) (19) 1 987 3 268
Depreciation and amortisation - (27) (58)
Impairment of intangible assets - - -
Operating profit (19) 1 960 3 210
Finance income - 18 64
Finance costs - (58) (86)
Share of associate income - - -
Profit before taxation (19) 1 920 3 188
Taxation (229) (691) (1 053)
Net profit (248) 1 229 2 135
Financial results
Revenue from continuing operations decreased by 6% to R260,6 million from R277,3
million for the previous comparative period ended 30 November 2008.
Notwithstanding the marginal reduction overall, the downturn in the vehicle
delivery market was in large measure successfully offset by revenue derived from
the newly-acquired RFB.
EBITDA declined by 7% from R50,1 million to R46,8 million in line with the
decline in revenue. With a net interest expense of R4,9 million, this still
equates to a satisfactory interest cover of 9,6 times.
Operating profit, representing 11,4% (Nov 2008: 13.1%) of revenue, reduced by
19% from R36,4 million to R29,6 million. The reduction is attributable to the
fixed cost of owning sufficient fleet to service the levels of activity
experienced before the economic downturn. The fleet is currently fully
operational and is being utilised across the group`s businesses.
Due to the comparatively lower lending rates in the interim period, net finance
costs decreased by 24% from R6,5 million to R4,9 million. This restricted the
decline in net profit before taxation to 18% from R30,1 million to R24,7
million.
Headline earnings per share ("HEPS") reduced by 16% from 8,3 cents to 7,0 cents.
HEPS from continuing operations reduced by 15% from 8,2 cents to 7,0 cents.
Increased working capital requirements as a result of a growth in revenue
generation since the previous year-end saw cash flow from operations decrease
from R35,9 million to R24,3 million.
The group invested R15,3 million in infrastructure: R11,5 million for fleet;
R1,9 million for IT infrastructure; R1,5 million for workshop facilities; and
R0,4 million for other assets. The infrastructure spend was financed by cash
generated by operations. New interest-bearing borrowings of R17,9 million raised
during the interim period, was offset by repayments of interest-bearing
borrowings of R 18,0 million.
Proceeds on disposal of assets raised R3,4 million. Cash resources at balance
sheet date increased by 30% from R25,1 million to R32,6 million as at 30
November 2009.
Capital distribution
Shareholders are advised that a distribution, by way of a capital reduction out
of the share premium account, of 3,0 cents per share (Nov 2008:Nil) has been
declared in respect of the interim period.
The salient dates in respect of the distribution are as follows:
2010
Last day to trade cum distribution on Thursday, 18 March
Shares will trade ex distribution from Friday, 19 March
Record date Friday, 26 March
Payment of distribution Monday, 29 March
Shareholders may not de-materialise or re-materialise their shares between
Friday, 19 March 2010 and Monday, 29 March 2010, both dates inclusive.
The distribution, amounting to R6,3 million, has not been recognised as a
liability in the interim financial information set out herein. It will be
recognised in shareholders` equity (utilised against share premium) in the year
to 31 May 2010.
OneLogix will continue to assess the payment of distributions in light of the
board`s ongoing assessment of earnings, after providing for long-term growth and
cash/debt resources, the amount of reserves available using going concern
assessment and covenants of banking facilities providers.
Prospects
Revenue is traditionally weighted to the first half of the financial year.
Notwithstanding this and the slow economic growth expected in the six months
ahead, the directors remain cautiously optimistic that the strength of the core
operations should enable the group at the least to maintain market share and to
perform well over the full financial year. Highly competitive offerings in
healthy niche markets are a key strength, which is well-supported by an
established infrastructure and experienced and motivated management.
A strong Balance Sheet is a major advantage and OneLogix will continue to
explore acquisitive opportunities in line with proven strategy to target well-
performing niche markets.
People
We are satisfied that our management and staff, who undergo continued training
and skills development, are well equipped to deliver on strategic and
operational objectives.
We thank them and our business partners, customers and shareholders for their
continued and invaluable support.
By order of the board
Ian Lourens Cameron McCulloch
CEO COO
22 February 2010
UNAUDITED INTERIM FINANCIAL RESULTS FOR THE SIX MONTHS ENDED 30 NOVEMBER 2009
Condensed Consolidated Statement of Comprehensive Income
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 November 30 November 31 May
2009 2008 2009
% R`000 R`000 R`000
Continuing operations
Revenue (6) 260,637 277,322 478,107
Operating and
administration costs (6) (213,804) (227,233) (403,662)
Earnings before
interest, taxation,
depreciation and
amortisation (EBITDA) (7) 46,833 50,089 74,445
Depreciation and
amortisation 26 (17,209) (13,660) (27,874)
Impairment of
intangible assets - - (1,698)
Operating profit (19) 29,624 36,429 44,873
Finance income (6) 312 331 700
Finance costs (23) (5,195) (6,790) (13,007)
Share of associate income - - 85 4
Profit before taxation (18) 24,741 30,055 32,570
Taxation (17) (7,076) (8,488) (10,036)
Profit from continuing
operations (18) 17,665 21,567 22,534
(Loss)/Profit from
discontinued operations (120) (248) 1,229 2,135
Net profit and
comprehensive income
for the period (24) 17,417 22,796 24,669
Net profit and
comprehensive income
attributable to:
- Minority interest (49) 2,802 5,456 4,278
- Equity holders of the
company (16) 14,615 17,340 20,391
Net profit and
comprehensive income (24) 17,417 22,796 24,669
Number of shares in
issue (`000):
- Total 210,131 210,131 210,131
- Weighted 210,131 210,131 210,131
- Diluted 210,131 210,131 210,131
Basic and headline
earnings per share (cents)
Basic and diluted basic
earnings per
share (cents) (16) 7.0 8.3 9.7
Headline and diluted
headline earnings per
share (cents) (16) 7.0 8.3 10.2
Continuing operations:
Basic and diluted basic
earnings per share
(cents) (15) 7.0 8.2 9.5
Headline and diluted
headline earnings per
share (cents) (15) 7.0 8.2 10.0
Discontinuing
operations:
Basic and diluted basic
earnings per
share (cents) (100) 0.0 0.1 0.2
Headline and diluted
headline earnings per
share (cents) (100) 0.0 0.1 0.2
Reconcilaition between
basic and headline earnings
Basic earnings 14,615 17,340 20,391
Loss/(Profit) on
disposal of property,
plant and equipment less
taxation and minorities 97 1 (120)
Impairment of intangible
assets less taxation and
minorities - - 1,148
Loss on disposal of
discontinued operation less taxation and
minorities 15 - -
Headline earnings 14,727 17,341 21,419
Condensed Consolidated Statement of Financial Position
Unaudited Unaudited Audited
At At At
30 November 30 November 31 May
2009 2008 2009
R`000 R`000 R`000
ASSET
Non-current assets 271,745 252,172 270,175
Property, plant and
equipment 209,272 206,567 213,406
Intangible assets 54,922 44,732 56,370
Interest in associate 120 201 120
Loans and receivables 7,431 672 279
Current assets 115,086 117,917 100,044
Inventories 6,204 6,000 5,044
Trade and other
receivables 76,295 86,783 67,601
Cash resources 32,587 25,134 27,399
Total assets 386,831 370,089 370,219
EQUITY AND LIABILITIES
Equity 182,689 166,631 168,210
Ordinary shareholders`
funds 168,097 150,431 153,482
Minority interests 14,592 16,200 14,728
Liabilities
Non-current liabilities 86,256 92,626 87,550
Interest-bearing
borrowings 66,972 79,804 68,042
Deferred tax 17,898 12,822 18,605
Share-based compensation
liability 1,386 - 903
Current liabilities 117,886 110,832 114,459
Trade and other payables 72,604 71,276 69,037
Interest-bearing
borrowings 42,888 38,785 44,118
Taxation 2,394 771 1,304
Total equity and
liabilities 386,831 370,089 370,219
Net asset value per
share (cents) 80.0 71.6 73.0
Net tangible asset value
per share (cents) 53.9 50.3 46.2
SEGMENTAL ANALYSIS
Revenue
Automotive and abnormal (7) 199,863 214,644 359,486
Media (11) 43,160 48,490 89,863
Retail 24 17,614 14,188 28,758
Continuing operations (6) 260,637 277,322 478,107
Discontinued operations
(Rail) (100) - 49,595 90,775
(20) 260,637 326,917 568,882
Operating profit
Automotive and abnormal (22) 25,659 33,089 46,206
Media (13) 3,696 4,259 856
Retail 31 5,494 4,193 9,570
Corporate 2 (5,225) (5,112) (11,759)
Continuing operations (19) 29,624 36,429 44,873
Discontinued operations
(Rail) (101) (19) 1,960 3,210
Total assets (23) 29,605 38,389 48,083
Condensed Consolidated Statement of Cash Flows
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 November 30 November 31 May
2009 2008 2009
R`000 R`000 R`000
Net cash generated from
operations
Continuing operations (32) 24,315 35,948 74,265
Discontinuing operations (91) 39 436 (600)
Net cash flows from
investing activities
Continuing operations (50) (18,933) (38,211) (58,168)
Discontinuing operations 462 (163) (29) (17)
Net cash flows from
financing activities
Continuing operations (100) (70) 17,469 2,335
Discontinuing operations (100) - 520 583
Net increase
in cash resources 5,188 16,133 18,398
Cash resources at
beginning of period 27,399 9,001 9,001
Cash resources at end of period 32,587 25,134 27,399
The group has authorised capital expenditure over the next six months of R25,3
million. R12,9 million is already committed. Given the prevailing economic
conditions it is possible that the balance may not be utilised.
Commitments
Operating lease
commitments (not exceeding five years) 9,627 12,468 15,490
Unaudited Unaudited Audited
At At At
30 November 30 November 31 May
2009 2008 2009
R`000 R`000 R`000
Automotive and abnormal 14 318,268 278,107 307,551
Media (18) 43,268 52,918 47,122
Retail 125 17,209 7,658 8,489
Corporate (49) 8,086 15,720 (1,308)
Continuing operations 9 386,831 354,403 361,854
Discontinued operations
(Rail) (100) - 15,686 8,365
5 386,831 370,089 370,219
Condensed Consolidated Statement of Changes in Equity
Share Share Retained Revaluation
Capital Premium Income Reserve
R`000 R`000 R`000 R`000
At 1 June 2008 - audited 2,101 47,400 73,354 10,184
Dividends declared
in subsidiaries - - - -
Net profit - - 17,340 -
At 30 November 2008 -
unaudited 2,101 47,400 90,694 10,184
Dividends declared
in subsidiaries - - - -
Net profit - - 3,051 -
At 31 May 2009 - audited 2,101 47,400 93,745 10,184
Other Minority
Reserves Interests Total
R`000 R`000 R`000
At 1 June 2008 - audited 52 12,361 145,452
Dividends declared
in subsidiaries - (1,617) (1,617)
Net profit - 5,456 22,796
At 30 November 2008 - unaudited 52 16,200 166,631
Dividends declared
in subsidiaries - (294) (294)
Net profit - (1,178) 1,873
At 31 May 2009 - audited 52 14,728 168,210
Directors:
SM Pityana (Chairman)*, NJ Bester, AC Brooking*, GM Glass (FD), AJ Grant*#,
IK Lourens (CEO), T Matshazi*, CV McCulloch (COO), JG Modibane*#
*Non-executive #Independent
Registered office:
46 Tulbagh Road, Pomona, Kempton Park
(Postnet Suite 10, Private Bag X27, Kempton Park, 1620)
Company Secretary:
Probity Business Services (Pty) Limited
Third Floor, The Mall Offices
11 Cradock Avenue, Rosebank, 2196
Transfer secretaries:
Computershare Investor Services (Pty) Limited
Ground Floor, 70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Designated advisor:
Java Capital (Proprietary) Limited
22 February 2010
Date: 22/02/2010 09:00:04 Produced by the JSE SENS Department.
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