| Wed 1 Sep 2010, 9:01 | | RAH - Real Africa Holdings Limited - Profit and Dividend Announcement for the |
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RAH
RAH
RAH - Real Africa Holdings Limited - Profit and Dividend Announcement for the
year ended 30 June 2010
REAL AFRICA HOLDINGS LIMITED
(Registration number 1994/003919/06)
Share code: RAH
ISIN code: ZAE000008702
("RAH" or "the group" or "the company")
Profit and Dividend Announcement for the year ended 30 June 2010
GROUP STATEMENTS OF COMPREHENSIVE INCOME
Year Year ended
ended 30 June
30 June
2010 2009
R`000 Audited Audited
Revenue 62 718 77 041
Net investment profit/(loss) 1 076 (6 694)
Share of profits of associates 44 418 47 731
Interest income 1 443 3 582
Operating income 109 655 121 660
Operating costs (3 869) (4 690)
Amortisation (6 606) (7 584)
Impairment of intangible asset (12 659) (11 818)
Impairment of available-for-sale investment (7 368) -
Interest expense (21) (602)
Profit before tax 79 132 96 966
Tax 1 403 1 740
Profit for the year 80 535 98 706
Other comprehensive income
Available-for-sale investments:
Changes in fair value, net of tax 77 693 (21 184)
Reclassification adjustment for impairment 96 -
included in profit for the year
Total comprehensive income for the year 158 324 77 522
Profit for the year attributable to:
Minority shareholder 3 267 6 758
Ordinary shareholders 77 268 91 948
80 535 98 706
Total comprehensive income for the year
attributable to:
Minority shareholder 7 812 3 331
Ordinary shareholders 150 512 74 191
158 324 77 522
Earnings per share (cents) 21.4 25.4
Headline earnings per share (cents) 24.5 30.1
GROUP STATEMENTS OF FINANCIAL POSITION
30 June 30 June
2010 2009
R`000 Audited Audited
ASSETS
Non current assets
Investment in associates 93 555 107 334
Available-for-sale investments 784 892 711 518
878 447 818 852
Current assets
Accounts receivable 556 377
Tax 196 2 575
Cash and cash equivalents 26 317 28 867
27 069 31 819
Total assets 905 516 850 671
EQUITY AND LIABILITIES
Capital and reserves
Ordinary shareholders` equity 838 136 780 487
Minority interest 56 432 56 465
894 568 836 952
Non current liabilities
Tax 10 510 12 315
10 510 12 315
Current liabilities
Accounts payable and accruals 438 1 404
438 1 404
Total liabilities 10 948 13 719
Total equity and liabilities 905 516 850 671
GROUP STATEMENT OF CHANGES IN EQUITY
R`000 Ordinary Minority Total
shareholders` interest
equity
Audited
For the year ended 30 June 2010
Balances at 30 June 2008 778 617 58 747 837 364
Profit for the year 91 948 6 758 98 706
Other comprehensive income for the (17 757) (3 427) (21 184)
year
Dividends paid (72 321) (5 613) (77 934)
Balances at 30 June 2009 780 487 56 465 836 952
Profit for the year 77 268 3 267 80 535
Other comprehensive income for the 73 244 4 545 77 789
year
Sale of treasury shares 1 196 - 1 196
Dividends paid (94 059) (7 845) (101 904)
Balance at 30 June 2010 838 136 56 432 894 568
SUMMARISED GROUP STATEMENTS OF CASH FLOWS
Year ended Year ended
30 June 30 June
2010 2009
R`000 Audited Audited
Cash flows from operating activities (3 037) (6 436)
Cash flows from investing activities 101 216 108 997
Cash flows from financing activities (100 729) (115 928)
Net cash flows (2 550) (13 367)
HEADLINE EARNINGS PER SHARE
Year ended Year ended
30 June 30 June
2010 2009
R`000 Audited Audited
Headline earnings per share (cents) 24.5 30.1
Weighted average number of shares (million) 361.8 361.6
Reconciliation of headline
earnings (R`000)
Earnings attributable to ordinary shareholders 77 268 91 948
Adjusted for:
Realised investment profits (2 172) (2 844)
Impairment of intangible asset 12 659 11 818
Impairment of available-for-sale investment 7 368 -
Provision for pension fund exposure - 9 000
Tax on above items (1 788) (41)
Minority interest in the above items (4 646) (957)
Headline earnings 88 689 108 924
NET ASSET VALUE
30 June 30 June
R`000 2010 2009
Afrisun Leisure 1 161 081 1 152 780
Other net liabilities (5 732) (4 555)
Cash 24 721 28 010
Net asset value 1 180 070 1 176 235
Issued shares net of treasury shares (million) 361.9 361.6
Net asset value per share (cents) 326 325
Note
All the investments held by Afrisun Leisure have been valued using the
Discounted Cash Flow (DCF) valuation method applying a discount rate of
12.11% (30 June 2009:12.45%) at 30 June 2010, to the directors` current
estimated future cash flows. A minority discount of 15% has been applied to
the valuation of the gaming company investments.
ACCOUNTING POLICIES
The condensed consolidated financial information for the year ended 30 June 2010
has been prepared in accordance with the recognition and measurement criteria of
International Financial Reporting Standards (IFRS) and the presentation and
disclosure requirements of IAS 34 - Interim Financial Reporting. The accounting
policies applied, other than those described below, are consistent with those
adopted in the financial statements for the year ended 30 June 2009.
The group has adopted the following new standard and amendment which are
mandatory for the first time for the financial year beginning 1 July 2009:
IAS 1 (Revised) - Presentation of Financial Statements, which requires changes
in equity not relating to equity owners to be disclosed in a separate statement.
As permitted by the standard, the group has elected to present the required
information as part of the statement of comprehensive income.
IFRS 8 - Operating Segments, which requires an entity to present segment
information on the same basis as that used for internal reporting purposes. The
operating segments have been identified as the group`s underlying investments.
AUDIT OPINION
Our auditor, PricewaterhouseCoopers Inc. audited the consolidated annual
financial statements and condensed consolidated financial information contained
herein. Their audit reports in which they expressed unqualified opinions are
available for inspection at the company`s registered office.
REVIEW OF RESULTS
Revenue of R62.7 million, comprising of dividends received was R14.3 million
below the previous year due to lower dividends received from SunWest and Afrisun
KZN and no dividends received from Emfuleni Resorts.
The net investment profit of R1.1 million (2009: R6.7 million loss)
relates to the profit on sale of investments by the Biotech Venture Fund of
R2.2 million (2009: R2.8 million), partly offset by the impairment of the
investment made to the Biotech Venture Fund of R1.1 million (2009: R0.5
million). The comparative year included a R9 million increase in the Life
Esidimeni (Pty) Ltd pension fund provision following a settlement that was
reached.
The share of profits of associates includes the group`s share of income from
Afrisun Gauteng, Zonwabise as well as the management companies. The share of
profits of associates has reduced mainly due to the decline in earnings at
Carnival City (Afrisun Gauteng).
The impairment of the intangible asset in Zonwabise of R12.7 million (2009:
R11.8 million) results from the decrease in the underlying value of its
investments in Emfuleni Resorts and the management companies. In addition, the
group also impaired its investment in Worcester by R7.4 million due to a
reduction in the underlying valuation.
Interest income has reduced due to lower cash balances as a result of the
settlement in the prior year of the group`s obligation to Life Esidimeni in
respect of the Lifecare Group Holdings Pension Fund.
Headline earnings per share declined by 19% from last year due to the lower
income received during the year.
The board has declared a final dividend of 14 cents (2009:14 cents) per share,
bringing the total dividend for the year to 26 cents (2009: 18 cents) per share.
NON CURRENT ASSETS
The group marginally increased its investment in Afrisun Gauteng by acquiring
additional shares in terms of a pre-emptive right. The group also acquired
additional shares in SunWest, although the effective shareholding in SunWest
decreased marginally due to the dilution resulting from the exercise of options
over SunWest shares by Grand Parade Investments.
The value of Afrisun Leisure has increased by 0.7% to R1 161 million at 30
June 2010 from the R1 153 million in 2009.
SUNWEST EXCLUSIVITY
GrandWest`s initial 10-year casino exclusivity in the Cape Metropole expires
during December 2010. The Provincial Government of the Western Cape (PGWC) is
considering whether to permit one of the other casino licence holders in the
Western Cape to relocate to the Cape Metropole and is engaging interested
stakeholders before taking a final decision in this regard. The PGWC has
indicated that it would seek to extend GrandWest`s exclusivity to enable proper
completion of this exercise and any consequential processes.
Insufficient information is currently available to assess the potential impacts
on GrandWest`s revenue and profitability. However, in the event that a
relocation and establishment of a new casino goes ahead, it is likely to be
material to GrandWest once opened, which is unlikely to be before the end of
2012.
BOARDWALK`S CASINO LICENCE
The Eastern Cape Gambling and Betting Board (ECGBB) announced during September
2009 that Emfuleni is the preferred bidder for the exclusive gaming licence in
Port Elizabeth. Currently the licensee and the ECGBB are in final consultations
on the licence conditions and finalisation is anticipated in advance to the
expiry of the current licence in October 2010. In determining the fair value of
the group`s investment in Emfuleni, management have assumed that, the entity
will be successful with its bid for the new casino licence.
OUTLOOK
Trading at the group`s major investments has stabilised and some growth in
revenue is expected in the new financial year. This outlook has not been
reviewed or reported on by the company`s auditors.
DIVIDEND
Notice is hereby given that a final dividend of 14 cents per share for the year
ended 30 June 2010 (2009: 14 cents) has been declared, payable to shareholders
recorded in the register of the company at the close of business on the record
date appearing below. The salient dates applicable to the final dividend are as
follows:
2010
Last day to trade cum final dividend Thursday, 16 September
First day to trade ex final dividend Friday, 17 September
Record date Thursday, 23 September
Payment date Monday, 27 September
No share certificates may be dematerialised or rematerialised between Friday, 17
September and Thursday, 23 September 2010, both days inclusive. Dividend
cheques will be posted and electronic payments made, where applicable, to
certificated shareholders on the payment date. Dematerialised shareholders will
have their accounts with their Central Securities Depository Participant or
broker credited on the payment date.
For and on behalf of the board
MV Moosa RP Becker
Chairman Financial director
01 September 2010
REGISTERED OFFICE
27 Fredman Drive, Sandown, Sandton, 2031
REGISTRAR
Computershare Investor Services (Pty) Ltd, 70 Marshall Street, Johannesburg,
2001
SPONSOR
Investec Bank Limited
DIRECTORS
MV Moosa (Chairman), RP Becker (Financial director), DC Coutts-Trotter, MJ
Leeming, MMT Ramano, Y Waja
SECRETARIES
Sun International Corporate Services (Pty) Limited
Date: 01/09/2010 09:01:12 Produced by the JSE SENS Department.
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