| Tue 16 Mar 2010, 7:05 | | CSB - Cashbuild Limited - Audited interim results - December 2009 |
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CSB
CSB
CSB - Cashbuild Limited - Audited interim results - December 2009
Cashbuild Limited
(Registration number: 1986/001503/06)
(Incorporated in the Republic of South Africa)
JSE code: CSB ISIN: ZAE000028320
Audited interim results - December 2009
* Revenue up 9% * Net asset value per share up 15%
* Cash & cash equivalents up 9%
* Headline earnings down 27% * Dividends per share down 26%
CONDENSED GROUP INCOME STATEMENT - AUDITED
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2009 2008 % 2009
R`000 (26 weeks) (26 weeks) change (52 weeks)
Revenue 2,803,003 2,572,840 9 5,065,843
Cost of sales (2,232,835) (2,018,516) 11 (4,003,162)
Gross profit 570,168 554,324 3 1,062,681
Selling and marketing expenses (390,409) (343,987) 13 (694,145)
Administrative expenses (62,352) (53,376) 17 (114,001)
Other operating expenses (1,244) (2,725) (54) (3,883)
Other income 1,205 321 275 626
Operating profit 117,368 154,557 (24) 251,278
Finance cost (787) (1,813) (57) (1,864)
Finance income 9,753 15,764 (38) 25,622
Profit before income tax 126,334 168,508 (25) 275,036
Income tax expense (39,910) (51,561) (23) (86,309)
Profit for the period 86,424 116,947 (26) 188,727
Attributable to:
Equity holders of the company 82,013 111,162 (26) 177,056
Minority interest 4,411 5,785 (24) 11,671
86,424 116,947 (26) 188,727
Earnings per share (cents) 361.1 489.5 (26) 779.7
Diluted earnings per share (cents) 360.3 489.5 (26) 779.5
CONDENSED GROUP STATEMENT OF COMPREHENSIVE INCOME - AUDITED
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Profit for the period 86,424 116,947 188,727
Other comprehensive income:
Foreign currency translation
adjustments (3,251) 2,132 (2,399)
Other comprehensive income for
the period, net of tax (3,251) 2,132 (2,399)
Total comprehensive income for
the period 83,173 119,079 186,328
Total comprehensive income attributable to:
Equity holders of the company 78,762 113,294 174,657
Minority interest 4,411 5,785 11,671
83,173 119,079 186,328
ADDITIONAL INFORMATION - AUDITED
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Net asset value per share (cents) 2,484 2,151 2,265
Ordinary shares (`000):
- In issue 25,805 25,805 25,805
- Weighted-average 22,709 22,709 22,709
- Diluted weighted-average 22,764 22,709 22,715
Capital expenditure 93,945 73,354 122,904
Depreciation of property, plant and
equipment 24,058 19,503 39,784
Amortisation of intangible assets 347 944 2,636
Capital commitments 133,303 99,670 211,612
Property operating lease commitments 789,928 811,470 801,165
Contingent liabilities 15,265 2,950 7,434
CONDENSED GROUP STATEMENT OF FINANCIAL POSITION - AUDITED
31 December 31 December 30 June
R`000 2009 2008 2009
ASSETS
Non-current assets 443,324 362,912 377,757
Property, plant and equipment 410,614 318,739 344,176
Intangible assets 24,065 21,734 22,280
Deferred income tax assets 8,645 22,439 11,301
Current assets 1,581,375 1,615,425 1,340,639
Assets held for sale 659 2,740 2,740
Inventories 868,689 952,802 907,712
Trade and other receivables 73,604 75,027 82,057
Cash and cash equivalents 638,423 584,856 348,130
Total assets 2,024,699 1,978,337 1,718,396
EQUITY AND LIABILITIES
Shareholders` equity 687,537 594,798 628,234
Share capital and reserves 640,885 555,191 584,555
Minority interest 46,652 39,607 43,679
Non-current liabilities 65,541 47,279 58,338
Deferred operating lease liability 61,493 43,458 54,409
Deferred profit 1,777 1,829 1,803
Borrowings (non interest-bearing) 2,271 1,992 2,126
Current liabilities 1,271,621 1,336,260 1,031,824
Trade and other liabilities 1,244,942 1,284,950 1,005,771
Current income tax liabilities 24,634 49,075 23,703
Employee benefits 2,045 2,235 2,350
Total equity and liabilities 2,024,699 1,978,337 1,718,396
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY - AUDITED
Attributable to equity holders of the company
R`000 Share Cum.
based trans- Re- Minor-
Treasury Treasury pay- lation tained ity
Share share Share share ments adjust- earn- inte- Total
capital capital premium premium reserve ment ings rest equity
Balance at 1 July 2008
258 (29) 115,817 (83,686) - (4,167) 442,774 34,142 505,109
Total comprehensive income for the period
- - - - - 2,132 111,162 5,785 119,079
Dividend paid: final 2008
- - - - - - (29,070) (320) (29,390)
Recognition of share based payments
- - - - - - - - -
Balance at 31 December 2008
258 (29) 115,817 (83,686) - (2,035) 524,866 39,607 594,798
Total comprehensive income for the period
- - - - - (4,531) 65,894 5,886 67,249
Dividend paid: interim 2009
- - - - - - (32,474) (1,814) (34,288)
Recognition of share based payments
- - - - 475 - - - 475
Balance at 30 June 2009
258 (29) 115,817 (83,686) 475 (6,566) 558,286 43,679 628,234
Total comprehensive income for the period
- - - - - (3,251) 82,013 4,411 83,173
Dividend paid: final 2009
- - - - - - (23,270) (1,438) (24,708)
Recognition of share based payments
- - - - 838 - - - 838
Balance at 31 December 2009
258 (29) 115,817 (83,686) 1,313 (9,817) 617,029 46,652 687,537
CONDENSED GROUP CASH FLOW STATEMENT - AUDITED
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Cash flows from operating activities
Cash generated from operations 432,754 337,158 223,577
Interest paid (787) (1,813) (1,864)
Taxation paid (36,323) (45,522) (94,504)
Net cash generated from operating
activities 395,644 289,823 127,209
Cash flows from investing activities
Net investment in assets (90,541) (72,843) (122,659)
Interest received 9,753 15,764 25,622
Net cash used in investing activities (80,788) (57,079) (97,037)
Cash flows from financing activities
Increase in borrowings 145 125 259
Dividends paid
- own equity (23,270) (29,070) (61,544)
- minorities (1,438) (320) (2,134)
Net cash used in financing activities (24,563) (29,265) (63,419)
Net increase/(decrease) in cash and
cash equivalents 290,293 203,479 (33,247)
Cash and cash equivalents at
beginning of period 348,130 381,377 381,377
Cash and cash equivalents at
end of period 638,423 584,856 348,130
CONDENSED GROUP SEGMENTAL ANALYSIS - AUDITED
South Africa
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Income statement
Revenue 2,356,361 2,112,890 4,182,746
Operating profit 93,266 107,172 169,122
Financial position
Segment assets 1,691,293 1,592,314 1,394,443
Segment liabilities 1,170,526 1,151,900 920,939
Other segment items
Depreciation 21,743 17,238 35,365
Amortisation 347 944 2,592
Capital expenditure 89,683 62,868 111,401
Other members of common monetary area*
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Income statement
Revenue 278,744 251,936 487,327
Operating profit 13,931 18,279 29,503
Financial position
Segment assets 201,332 223,857 192,720
Segment liabilities 92,003 127,861 90,936
Other segment items
Depreciation 1,472 1,542 3,028
Amortisation - - -
Capital expenditure 349 9,528 10,210
*Includes Namibia, Swaziland and Lesotho
Botswana and Malawi
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Income statement
Revenue 167,898 208,014 395,770
Operating profit 10,171 29,106 52,653
Financial position
Segment assets 132,074 162,166 131,233
Segment liabilities 74,633 103,778 78,287
Other segment items
Depreciation 843 723 1,391
Amortisation - - 44
Capital expenditure 3,913 958 1,293
Group
Six months Six months Year
ended ended ended
31 December 31 December 30 June
R`000 2009 2008 2009
Income statement
Revenue 2,803,003 2,572,840 5,065,843
Operating profit 117,368 154,557 251,278
Financial position
Segment assets 2,024,699 1,978,337 1,718,396
Segment liabilities 1,337,162 1,383,539 1,090,162
Other segment items
Depreciation 24,058 19,503 39,784
Amortisation 347 944 2,636
Capital expenditure 93,945 73,354 122,904
NOTES TO THE CONDENSED GROUP INTERIM FINANCIAL INFORMATION
1. Basis of preparation. The condensed consolidated interim financial
information ("financial information") announcement is based on the audited
interim financial statements of the group for the period ended 31 December 2009
which have been prepared in accordance with International Financial Reporting
Standards ("IFRS") and the presentation and disclosure requirements of IAS 34 -
Interim Financial Reporting, the Listings Requirements of the JSE and the South
African Companies Act (1973). The accounting policies are consistent with those
used in the annual financial statements for the financial year ended June 2009
with the following exceptions: The group adopted the revised IAS 1, Presentation
of Financial Statements, IFRS 8, Operating Segments and Circular 3/2009 on
Headline Earnings during the period under review. The presentation of the
financial statements and operating segments disclosures have been changed
accordingly to the changes in IAS 1 and IFRS 8 respectively, with no adjustment
necessary on the adoption of Circular 3/2009.
2. Independent audit by the auditors. These condensed consolidated interim
results have been audited by our auditors PricewaterhouseCoopers Inc., who have
performed their audit in accordance with the International Standards on
Auditing. A copy of their unqualified audit report is available for inspection
at the registered office of the company.
3. Reporting period. The group adopts the retail accounting calendar, which
comprises the reporting period ending on the last Saturday of the month (2009:
26 December (26 weeks); 2008: 27 December (26 weeks); June 2009: 27 June (52
weeks)).
4. Earnings per share. Earnings per share is calculated by dividing the earnings
attributable to shareholders for the period by the weighted average number of
22,709,487 ordinary shares in issue during the period. (December 2008:
22,709,487 shares; June 2009: 22,709,487 shares).
5. Headline earnings per ordinary share. The calculations of headline earnings
and diluted headline earnings per ordinary share are based on headline earnings
of R81.0 million (December 2008: R111.4 million; June 2009: R177.4 million) and
a weighted average of 22,709,487 (December 2008: 22,709,487; June 2009:
22,709,487) and fully diluted of 22,763,737 (December 2008: 22,709,487; June
2009: 22,715,519) ordinary shares in issue.
Reconciliation between net profit attributable to the equity holders of the
company and headline earnings:
R`000 Dec-09 Dec-08 % Change Jun-09
Net profit attributable to the
company`s equity holders 82,013 111,162 (26) 177,056
(Profit)/loss on sale of assets
after taxation (1,035) 258 353
Headline earnings 80,978 111,420 (27) 177,409
Headline earnings per share (cents) 356.6 490.6 (27) 781.2
Diluted headline earnings per share
(cents) 355.7 490.6 (27) 781.0
6. Declaration of dividend. The board has declared an interim dividend (No. 34),
of 106 cents (December 2008: 143 cents) per ordinary share to all shareholders
of Cashbuild Limited. The dividend per share is calculated based on 25,805,347
shares in issue at date of dividend declaration.
Date dividend declared: Monday, 15 March 2010;
Last day to trade "CUM" the dividend: Friday, 09 April 2010;
Date commence trading "EX" the dividend: Monday, 12 April 2010;
Record date: Friday, 16 April 2010;
Date of payment: Monday, 19 April 2010;
Share certificates may not be dematerialised or rematerialised between Monday,
12 April 2010 and Friday, 16 April 2010, both dates inclusive.
On behalf of the board
DONALD MASSON PAT GOLDRICK
Chairman Chief executive
Johannesburg Date: 15 March 2010
NATURE OF BUSINESS
Cashbuild is southern Africa`s largest retailer of quality building materials
and associated products, selling direct to a cash-paying customer-base through
our constantly expanding chain of stores (188 at the end of this reporting
period). Cashbuild carries an in-depth quality product range tailored to the
specific needs of the communities we serve. Our customers are typically home-
builders and improvers, contractors, farmers, traders, large construction
companies and government-related infrastructure developers, as well as all other
customers requiring quality building materials at lowest prices.
Cashbuild has built its credibility and reputation by consistently offering its
customers quality building materials at the lowest prices and through a
purchasing and inventory policy that ensures customers` requirements are always
met.
INTERNATIONAL FINANCIAL REPORTING STANDARDS
The group is reporting its audited interim results in accordance with
International Financial Reporting Standards ("IFRS").
FINANCIAL HIGHLIGHTS
Revenue for the half-year increased by 9% whilst profit decreased by 26%. This
decrease in profit was as a result of a decrease in gross profit margins in
percentage terms of 1.2%, resulting in a decrease in operating profit of 24%.
Finance income decreased by 36%. Basic earnings per share decreased by 26%,
whilst headline earnings per share decreased by 27%. Net asset value per share
has shown a 15% increase, from 2,151 cents (December 2008) to 2,484 cents. Cash
and cash equivalents increased by 9% to R638 million.
Stores in existence since the beginning of July 2008 (pre-existing stores - 170
stores) accounted for 3% of the increase in revenue with the remaining 6%
increase due to the 18 new stores the group has opened since July 2008. This
increase for the half-year has been achieved in tough trading conditions with
selling price inflation of 1%. The excellent growth in customer transactions of
13%, of which 6% is from the existing store base, is encouraging and bodes well
for the future.
Due to the competitive environment, gross profit margins of 20.3% remained under
pressure throughout this trading period and were 1.2% lower than the 21.5%
achieved for the comparative half year. They were however, at similar levels to
that of the 2nd half of the prior financial year.
Operational expenses for the half-year remained well controlled with existing
stores accounting for 8% of the increase and new stores 5%. The total increase
for the year amounted to 13%. The main contributor to the increase on existing
stores, is the continued investment in people to maintain and improve customer
service standards.
The effective tax rate for the half-year of 31.6% is 1% higher than that of the
previous half-year, mainly due to assessed losses in a subsidiary having now
been fully utilised.
Cashbuild`s financial position remains solid. Stock levels have decreased by a
pleasing 9%, in spite of the stocking of seven additional stores since the
previous half year-end. Overall stockholding at 68 days (December 2008: 79 days;
June 2009: 84 days) showed an improvement on the position as at December 2008.
Management of stock will remain a focus area for the year to come. Trade
receivables remain well under control.
During the half-year Cashbuild opened five new stores. Four stores were
refurbished and none relocated. Cashbuild will continue its store expansion,
relocation and refurbishment strategy in a controlled manner, applying the same
rigid process as in the past.
PROSPECTS
Management remains optimistic about the top line trading prospects for the next
quarter based on the fact that the first nine trading weeks since half year-end
have shown an increase in revenue of 6% on that of the comparable nine weeks.
Gross profit margins are expected to remain under pressure for the quarter under
review.
Directors: D Masson* (Chairman), PK Goldrick (Chief executive) (Irish), WF de
Jager, J Molobela*, KB Pomario, FM Rossouw*, NV Simamane*, SA Thoresson, A van
Onselen
(*Non-executive)
Company secretary: Corporate Governance Leaders CC
Registered office: cnr Aeroton and Aerodrome Roads, Aeroton, Johannesburg 2001.
PO Box 90115, Bertsham 2013
Transfer secretaries: Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg 2001. PO Box 61051, Marshalltown 2107
Auditors: PricewaterhouseCoopers Inc.
Sponsor: Nedbank Capital
QUALITY BUILDING MATERIALS AT THE LOWEST PRICES
www.cashbuild.co.za
Date: 16/03/2010 07:05:02 Produced by the JSE SENS Department.
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