| Wed 14 Apr 2010, 10:41 | | APK - Astrapak Limited - Trading statement disposals and internal re- |
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APK
APK
APK - Astrapak Limited - Trading statement, disposals and internal re-
organisation
(Incorporated in the Republic of South Africa)
(Registration number: 1995/009169/06)
ISIN: ZAE000096962
Share Code: APK
("Astrapak" or "the Group")
TRADING STATEMENT - FINANCIAL YEAR ENDED 28 FEBRUARY 2010
In terms of the Listings Requirements of the JSE, a company is required to
publish a trading statement as soon as the company is satisfied that a
reasonable degree of certainty exists that the financial results for the period
to be reported upon next will differ by at least 20% or more from those of the
corresponding reporting period of the previous year ("comparative period"). The
board of directors of Astrapak ("the Board") hereby advise shareholders that
Astrapak is now in the process of finalising the results for the financial year
ended 28 February 2010 ("reporting period"). The results in respect of the
reporting period have not yet been reviewed, audited or reported on by the
Group`s auditors and the following trading statement is based on the information
available at the time of this announcement.
Shareholders of Astrapak are reminded that the results in the comparative period
were negatively impacted by certain once-off items of expenditure and the
reversal of deferred tax assets totaling approximately R20 million. This
resulted in a much lower base being established for comparative purposes and the
improvements in earnings per share ("EPS") and headline earnings per share
("HEPS") as reported in this announcement should be normalised for these items
to determine the true growth from operational activities.
The strategy of extracting value by improving internal efficiencies and adopting
best practices continues to reap rewards. In addition, much improved cost and
working capital management, the cash proceeds from disposals, improved cash
generation and capital allocation, assisted by a lower interest rate
environment, all had a positive impact on the results for the reporting period.
The Board therefore advises shareholders of Astrapak that HEPS from continuing
operations is expected to be between 80% and 100% higher than that reported in
the comparative period, which will result in anticipated HEPS of between 112.2
cents and 124.6 cents (2009: 62.3 cents). EPS from continuing operations is
expected to be between 175% and 195% higher than that reported in the
comparative period, which will result in anticipated EPS from continuing
operations of between 106.2 cents and 113.9 cents (2009: 38.6 cents) for the
reporting period.
Combined HEPS, from both continuing and discontinued operations, is expected to
be between
40% and 60% higher than that reported in the comparative period, which will
result in anticipated combined HEPS of between 100.9 cents and 115.3 cents
(2009: 72.1 cents). Combined EPS, from both continuing and discontinued
operations, is expected to be between 150% and 170% higher than that reported in
the comparative period, which will result in anticipated combined EPS from both
continuing and discontinued operations of between 88.8 cents and 95.9 cents
(2009: 35.5 cents) for the reporting period.
The Group`s results for the financial year ended 28 February 2010 are expected
to be finalised and published on SENS on 10 May 2010.
DISPOSALS
Disposal of various properties and equity interest in Mauritian Joint Venture
In terms of SENS announcements dated 31 March 2009 and 12 August 2009 ("the SENS
announcements") Astrapak advised that, as the first step in the implementation
of its new strategy to focus on its core strengths, it was to dispose of certain
of its flexible operations to Afripack Consumer Flexibles (Pty) Limited
("Afripack") ("the disposal transaction"). In addition to the disposal
transaction, which was subsequently successfully concluded, Astrapak also
advised that it had entered into separate sale agreements in terms of which
Afripack would also acquire the two properties occupied by Cape Wrappers (Pty)
Ltd and the Group`s equity interest in its Mauritian Joint Venture for a
combined purchase consideration of R 30.0m (thirty million rand).
These additional transactions have now all been concluded and the purchase
consideration for these transactions has been paid to Astrapak.
Disposal of equity interests in Izakhamzi Plastics (Pty) Limited ("Izakhamzi"),
International Tube Technologies (Pty) Limited ("ITT") and International
Edgeboard Technologies (Pty) Limited ("IET")
Continuing with its stated strategy to focus on its core strengths, the Group
wishes to advise that it has also disposed of its equity interests in Izakhamzi,
ITT and IET for a combined consideration of R 6.9m (six million nine hundred
thousand rand). The Group`s equity interests were disposed of to the existing
management shareholders of these companies.
The disposal of the Group`s equity interest in Izakhamzi has been completed and
the purchase consideration settled, whilst the disposal of the Group`s equity
interest in ITT and IET is still subject to the fulfillment of certain
conditions precedent and the Board anticipates that these will be fulfilled in
the very near future.
In terms of the JSE Listing Requirements none of these transactions required any
SENS or similar notification at the time of the entering into or closing of the
relevant transactions.
INTERNAL RE-ORGANISATION IN TERMS OF THE CORPORATE RULES OF THE INCOME TAX ACT
As at 28 February 2010 the Group successfully implemented an internal
reorganisation program in terms of the corporate rules contained in sections 41
to 47 of the Income Tax Act ("The Act"). These corporate rules allow for the
transfer of assets with no immediate tax consequences between group companies as
defined in the Act. This restructuring program was an internal process aimed at
reducing the costs associated with a cumbersome group structure, it involved no
third parties and had no impact on the employment or any employees of the Group.
The main benefits to be derived from the internal restructure are:
(a) a simplified group structure - a reduction from the existing 75 to only 19
statutory entities;
(b) significant annual cost and time based savings associated with
administration and compliance (audit, tax, legislative and other); and
(c) improved resource utilisation and allocation.
The changes will better align the structure and strategic intent of the Group
and are all designed to reduce costs, enhance efficiency, decision-making and
speed of execution.
Sandton
14 April 2010
Merchant bank and sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 14/04/2010 10:41:01 Produced by the JSE SENS Department.
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