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ELR ELRP
ELR
ELR/ELRP - ELB Group - Unaudited group interim report and interim cash
dividend declarations for the six months ended 31 December 2009
ELB GROUP LIMITED
Incorporated in the Republic of South Africa
Registration number 1930/002553/06
Share codes: ELR & ELRP
ISIN: ZAE000035101 & ZAE000035333
(`ELB`, `the Company` or `the Group`)
UNAUDITED GROUP INTERIM REPORT AND INTERIM CASH DIVIDEND DECLARATIONS FOR THE
SIX MONTHS ENDED 31 DECEMBER 2009
COMMENTS
INTRODUCTION
The ELB Group is a total solutions provider to the mining, minerals, power,
port, construction and industrial sectors in the field of materials handling and
appropriate process plants. This is achieved through ELB generated innovation
and the supply with world class partners of equipment and technology. The Group
operates in Africa and Australia.
FINANCIAL RESULTS
The 22 percent decrease in turnover for the period from R711,9 million in 2008
to R554,6 million in 2009 is largely attributable to reduced capital equipment
sales to the mining and construction sectors.
Headline earnings for the period of R12,8 million (2008 - R15,3 million)
represents a decrease of 16,4 percent.
Both the African and the Australian businesses traded profitably for the period.
A number of significant new projects have been added to the order book. This
augurs well for the future.
CASH FLOW
Cash flow management remained a high priority for the period.
The ELB Group works closely with bankers, suppliers and customers to ensure we
continue to retain a strong balance sheet at all times.
PROSPECTS
The global resources and power industry sectors have remained affected by the
current economic downturn. There are indications however that suggest that the
activity levels in the sectors we serve are starting to pick up.
DIVIDENDS
In line with ELB`s historic conservative approach to dividend distribution it
has been decided to declare an interim dividend of 12 cents (2008 - 10 cents)
per ordinary share.
ACCOUNTING POLICIES
The unaudited interim financial statements have been prepared in accordance with
International Accounting Standard (IAS) 34: Interim Financial Reporting.
Accounting policies accord with International Financial Reporting Standards
(IFRS) and are consistent with those applied in the financial year ended 30 June
2009; with the exception of the implementation of IAS 1 (revised) and IFRIS 8
which have introduced certain changes to the presentation of the financial
statements and segment information, in this interim report. The interim
financial statements also comply with the South African Companies Act.
On behalf of the Board
AG Fletcher
Chairman
Boksburg
16 March 2010
GROUP INCOME STATEMENT
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 09 31 Dec 08 30 Jun 09
R 000 R 000 R 000
554 629 711 897 1 245 817
Sales
Operating costs excluding (531 400) (691 596) (1 170 147)
depreciation
Operating profit before 23 229 20 301 75 670
depreciation
Depreciation (2 284) (2 578) (5 108)
Profit from operations 20 945 17 723 70 562
Profit on realisation of - - 4 232
non current assets held for
sale
Finance income 5 176 17 641 27 953
Finance expenses (3 258) (6 460) (9 717)
Profit before income tax 22 863 28 904 93 030
Income tax expense (8 256) (11 252) (29 562)
Profit for the period 14 607 17 652 63 468
Profit for the period
attributable to:
Ordinary shareholders of 12 974 15 342 55 526
ELB
Minority interest 1 633 2 310 7 942
14 607 17 652 63 468
CALCULATION OF GROUP HEADLINE EARNINGS
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 09 31 Dec 08 30 Jun 09
R 000 R 000 R 000
Profit attributable to 12 974 15 342 55 526
ordinary shareholders of
ELB from the income
statement
Deduct: Items excluded from 181 39 4 230
headline earnings as
detailed below:
Profit/(loss) on disposal 302 64 (313)
of plant and equipment:
included in profit from
operations
Profit on realisation of - - 4 232
non current assets held for
sale
Income tax effect of items (89) (18) 277
excluded from headline
earnings
Minority interest in items (32) (7) 34
excluded from headline
earnings
Headline earnings 12 793 15 303 51 296
Weighted average number of 26 733 27 237 27 128
ordinary shares (excluding
treasury shares) on which
basic earnings per ordinary
share are based (000`s)
Earnings per ordinary share
(cents)
- basic and diluted 48.5 56.3 204.7
Headline earnings per
ordinary share (cents)
- basic and diluted 47.9 56.2 189.1
Dividends declared for the 12 10 30
period per ordinary share
(cents)
GROUP STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 09 31 Dec 08 30 Jun 09
R 000 R 000 R 000
Profit for the period from 14 607 17 652 63 468
the income statement
Other comprehensive income 3 894 (10 440) (14 927)
Foreign currency translation
adjustments for foreign
operations
Gross 3 894 (10 440) (14 927)
Income tax effect - - -
Total comprehensive income 18 501 7 212 48 541
for the period
Total comprehensive income
for the period attributable
to:
Ordinary shareholders of ELB 16 284 6 468 42 838
Minority interest 2 217 744 5 703
18 501 7 212 48 541
GROUP STATEMENT OF CHANGES IN EQUITY
Attributable to ordinary shareholders of ELB
Issued Treasury Reserves Retained Total
capital shares earnings
R 000 R 000 R 000 R 000 R 000
Balance at 30 25 192 (24 758) 9 163 254 251 263 848
June 2008
Total (12 688) 55 526 42 838
comprehensive
income for the
year
Ordinary (13 514) (13 514)
dividends paid
Transfer to 4 427 4 427
share options
reserve
Increase in (6 403) (6 403)
treasury
shares held by
the share
trusts
Balance at 30 25 192 (31 161) 902 296 263 291 196
June 2009
Total 3 310 12 974 16 284
comprehensive
income for the
six months
Ordinary (5 403) (5 403)
dividend paid
Transfer to 1 374 1 374
share options
reserve
Increase in (9 872) (9 872)
treasury
shares held by
the share
trusts
Balance at 31 25 192 (41 033) 5 586 303 834 293 579
December 2009
Balance at 30 25 192 (24 758) 9 163 254 251 263 848
June 2008
Total (8 874) 15 342 6 468
comprehensive
income for the
six months
Ordinary (10 812) (10 812)
dividend paid
Transfer to 2 191 2 191
share options
reserve
Increase in (6 496) (6 496)
treasury
shares held by
the share
trusts
Balance at 31 25 192 (31 254) 2 480 258 781 255 199
December 2008
GROUP STATEMENT OF CHANGES IN EQUITY continued
Attributable
to ordinary
shareholders Unaudited
of ELB Preference Minority Total
Total shares interest equity
R 000 R 000 R 000 R 000
Balance at 30 263 848 8 21 710 285 566
June 2008
Total 42 838 5 703 48 541
comprehensive
income for the
year
Ordinary (13 514) (435) (13 949)
dividends paid
Transfer to 4 427 781 5 208
share options
reserve
Increase in (6 403) (6 403)
treasury shares
held by the
share trusts
Balance at 30 291 196 8 27 759 318 963
June 2009
Total 16 284 2 217 18 501
comprehensive
income for the
six months
Ordinary (5 403) (5 403)
dividend paid
Transfer to 1 374 243 1 617
share options
reserve
Increase in (9 872) (9 872)
treasury shares
held by the
share trusts
Balance at 31 293 579 8 30 219 323 806
December 2009
Balance at 30 263 848 8 21 710 285 566
June 2008
Total 6 468 744 7 212
comprehensive
income for the
six months
Ordinary (10 812) (10 812)
dividend paid
Transfer to 2 191 387 2 578
share options
reserve
Increase in (6 496) (6 496)
treasury shares
held by the
share trusts
Balance at 31 255 199 8 22 841 278 048
December 2008
GROUP BALANCE SHEET
Unaudited Unaudited Audited
31 Dec 09 31 Dec 08 30 Jun 09
R 000 R 000 R 000
ASSETS
Non current assets 69 698 61 295 59 888
Property, plant and 47 408 41 545 39 617
equipment
Non current loan receivable 3 444 3 365 3 469
Deferred income tax assets 18 846 16 385 16 802
Current assets 691 583 876 456 816 750
Inventories and 312 224 472 087 373 079
construction contract work
not yet billed
Receivables and other 127 547 110 796 151 785
current assets
Income tax refundable 6 498 65 1 597
Cash and cash equivalents 245 314 293 508 290 289
Total assets 761 281 937 751 876 638
EQUITY AND LIABILITIES
Equity attributable to 293 579 255 199 291 196
ordinary shareholders of
ELB
Issued capital 25 192 25 192 25 192
Treasury shares (41 033) (31 254) (31 161)
Reserves 5 586 2 480 902
Retained earnings 303 834 258 781 296 263
Preference shares 8 8 8
Total equity attributable 293 587 255 207 291 204
to equity holders of ELB
Minority interest 30 219 22 841 27 759
Total equity 323 806 278 048 318 963
Non current liabilities 16 608 21 747 19 333
Interest bearing borrowings 5 030 8 598 7 606
Provision for trade back 10 694 10 876 11 107
commitments
Deferred income tax 884 2 273 620
liabilities
Current liabilities 420 867 637 956 538 342
Non interest bearing 346 961 422 636 379 015
payables and other current
liabilities
Interest bearing payables 72 646 206 406 150 158
Income tax payable 1 260 3 728 9 169
Bank overdraft - 5 186 -
Total equity and 761 281 937 751 876 638
liabilities
Ordinary shares in issue 33 860 33 860 33 860
(000`s)
Deduct: Treasury shares in 7 842 6 843 6 842
issue (000`s)
Ordinary shares in issue on 26 018 27 017 27 018
which net asset value per
ordinary share is
calculated
Net asset value per 1 128 945 1 078
ordinary share (cents)
GROUP CASH FLOW STATEMENT
Unaudited Unaudited Audited
Six months Six months Year
Ended ended ended
31 Dec 09 31 Dec 08 30 Jun 09
R 000 R 000 R 000
Cash (outflow) / inflow from (16 447) (1 229) 12 121
operating activities before
dividends paid
Dividends paid (5 403) (10 812) (13 949)
Cash outflow from operating (21 850) (12 041) (1 828)
activities
Cash outflow from investment (9 773) (2 239) (3 218)
activities
Cash outflow from financing (12 688) (6 789) (7 881)
activities
Cash outflow for the period (44 311) (21 069) (12 927)
Foreign currency exchange ( 664) (5 843) (12 018)
and translation adjustments
to cash and cash equivalents
Decrease in cash and cash (44 975) (26 912) (24 945)
equivalents
Cash and cash equivalents at 290 289 315 234 315 234
the beginning of the period
Cash and cash equivalents at 245 314 288 322 290 289
the end of the period
Reconciliation to the
balance sheet
Current assets - cash and 245 314 293 508 290 289
cash equivalents
Current liabilities - bank - (5 186) -
overdraft
245 314 288 322 290 289
NOTES
Capital commitments
At 31 December 2009 there were capital
commitments of R 18 521 000 (31 December
2008 - R 1 890 000, 30 June 2009 - R 23
837 000). The commitments, which
comprise additions and improvements to
existing property, will be met from
mortgage bond facilities available to
the Group with limited drawings on the
Group`s cash and cash equivalents.
Contingent liabilities
A Group entity has issued a guarantee of
R 830 000 in favour of a raw material
supplier to a company which was
previously part of the ELB Timbers
segment, and has now been sold. The
guarantee is cancellable by three
calendar months notice. A financial
guarantee liability of R 76 000 has been
accrued in respect of the guarantee.
ELB Engineering Services operates in the
engineering contracting business and is
exposed to the risks associated with
engineering contracts. These risks are
managed on the basis of limited
liability.
All known liabilities of the group have
been accrued. However a contractual
dispute has arisen that the directors
believe will be unlikely to result in a
material loss.
SEGMENT ANALYSIS
Eliminate
African Australian inter
Total operations operations company
R 000 R 000 R 000 R 000
Unaudited
Six months ended 31
December 2009
Sales 554 629 506 511 48 118 -
Profit for the period 14 607 13 261 1 346 -
Headline earnings 12 793 11 785 1 008 -
Assets 761 281 653 411 111 154 (3 284)
Liabilities 437 475 426 362 14 397 (3 284)
Unaudited
Six months ended 31
December 2008
Sales 711 897 643 476 68 421 -
Profit for the period 17 652 13 022 4 630 -
Headline earnings 15 303 11 376 3 927 -
Assets 937 751 823 547 118 369 (4 165)
Liabilities 659 703 636 081 27 787 (4 165)
Unaudited
Year ended 30 June
2009
Sales 1 245 817 1 115 488 130 329 -
Profit for the year 63 468 52 535 10 933 -
Headline earnings 51 296 42 025 9 271 -
Assets 876 638 758 957 121 136 (3 455)
Liabilities 557 675 531 682 29 448 (3 455)
INTERIM CASH DIVIDEND DECLARATIONS
The directors have declared the
following interim cash dividends for the
six months ended 31 December 2009.
PREFERENCE DIVIDEND NUMBER 118
An interim cash dividend has been
declared at the rate of 6% per annum for
the first six month period on the 6%
fixed cumulative redeemable preference
shares of R2 each, equivalent to 6 cents
per preference share.
ORDINARY DIVIDEND NUMBER 124
An interim cash dividend of 12 cents per
share has been declared on the ordinary
shares.
The salient dates in respect of both
dividends are:
Last day to trade cum dividend Friday, 30 April 2010
Shares commence trading ex Monday, 3 May 2010
dividend
Record date Friday, 7 May 2010
Date of payment Monday, 10 May 2010
Share certificates may not be
dematerialised or rematerialised between
Monday, 3 May 2010, and Friday, 7 May
2010, both dates inclusive.
By order of the Board
DG Jones
Secretary
Boksburg
16 March 2010
REGISTERED OFFICE
ELB Equipment Limited
14 Atlas Road
Anderbolt
Boksburg
1459
SHARE TRANSFER SECRETARIES
Computershare Investor Services (Pty)
Limited
70 Marshall Street
Johannesburg
2001
(PO Box 61051, Marshalltown, 2107)
SPONSOR
Rand Merchant Bank (a division of
FirstRand Bank Limited)
1 Merchant Place
cnr Fredman Drive and Rivonia Road
Sandton
2196
WEBSITE
www.elb.co.za
DIRECTORS
AG Fletcher (chairman) PJ Blunden (chief
executive - ELB Equipment) T de Bruyn*
Dr JP Herselman* Dr SJ Meijers (chief
executive - ELB Engineering Services) MV
Ramollo
*Non executive
Date: 17/03/2010 09:45:01 Produced by the JSE SENS Department.
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