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CRG
CRG
CRG - Cargo Carriers Limited - Un-audited results for the six months ended 31
August 2010 and Dividend Announcement
Cargo Carriers Limited
(Registration number 1959/003254/06)
Share code: CRG
ISIN: ZAE000001764
("CRG" or "the group")
Un-audited results for the six months ended 31 August 2010 and Dividend
Announcement
CONSOLIDATED STATEMENT Half-year Half-year Audited year ended
OF COMPREHENSIVE ended ended 28/02/2010 R`000
INCOME 31/08/2010 31/08/2009
R`000 R`000
Revenue 279 732 236 932 443 812
Other revenue 2 472 2 971 5 405
Finance income 2 864 4 596 9 157
Operating and (245 004) (206 312) (386 730)
administration costs
Depreciation (15 273) (14 797) (29 205)
Operating profit 24 791 23 390 42 439
before abnormal items
Profit on disposal of 575 1 694 3 735
tangible assets
Abnormal items (840) - 506
Operating profit after 24 526 25 084 46 680
abnormal items
Income from associates 1 839 1 794 1 395
and joint venture
Operating profit 26 365 26 878 48 075
before finance costs
Finance costs (7 798) (9 499) (16 540)
Profit before taxation 18 567 17 379 31 535
Taxation (4 488) (3 995) (6 709)
Profit for the period 14 079 13 384 24 826
from continuing
operations
Other comprehensive
income:
Capital portion of - - 4 725
property revaluation
Exchange loss on (850) (3 845) (4 376)
translation of foreign
operations
Income tax effect of - - (1 323)
other comprehensive
income
Other comprehensive (850) (3 845) (974)
loss for the half year
Total comprehensive 13 229 9 539 23 852
income for the half
year
Total comprehensive
income for the half
year attributable to:
Equity holders of the 13 229 9 539 23 852
parent
Minority interests - - -
Total comprehensive 13 229 9 539 23 852
income for the half
year
FINANCIAL INFORMATION
Dividend per share (cents)
- paid during the period 20.0 9.0 9.5
- declared after the period end 12.0 9.5 20.0
Total dividends 32.0 18.5 29.5
Basic/diluted earnings per 72.5 69.0 128.0
share (cents)
Adjustments to earnings per
share:
- Profit on disposal of (2.1) (6.3) (13.9)
tangible assets
- Impairment of tangible assets 13.5 - 62.0
- Fair value adjustment to (9.2) - -
investment in joint venture
- Reversal of impairment in - - (12.9)
Zimbabwe operations
- Fair value adjustment to - - (44.4)
investment properties
Basic/diluted headline earnings 74.7 62.7 118.8
per share (cents)
Borrowings
Net borrowing capacity 167 686 156 792 163 012
(R`000)
Net borrowing capacity 130 846 57 710 24 736
utilized (R`000)
Net borrowing capacity 78.0% 36.8% 15.2%
utilized (%)
Capital commitments (R`000) 3 609 1 148 20 436
Net asset value per share 1728 1616 1680
(cents)
Ordinary shares in issue 19 406 19 406 19 406
(closing and weighted average)
(000)
ABNORMAL ITEMS
Reversal of impairment in - - 2 509
Zimbabwe operations
Fair value adjustment to - - 10 018
investment properties
Impairment of tangible (2 622) - (12 021)
assets
Fair value adjustment to 1 782 - -
investment in joint
venture
(840) - 506
SEGMENTAL ANALYSIS
Turnover
Industrial 179 329 128 936 256 479
Agricultural 73 826 81 337 132 650
Consumer 3 597 3 900 7 770
Aviation 6 390 6 539 12 426
Supply chain services 17 708 17 909 37 356
Property 1 354 1 282 2 536
282 204 239 903 449 217
Operating profit/(loss) before
finance costs
Industrial 24 535 17 727 56 665
Agricultural (615) 6 936 (14 969)
Consumer (72) (298) (812)
Aviation 3 734 3 579 6 907
Supply chain services (2 241) (2 112) (3 182)
Property 1 024 3 466
1 046
26 365 26 878 48 075
CONSOLIDATED STATEMENT OF Half-year Half-year Audited
FINANCIAL POSITION ended ended year ended
31/08/2010 31/08/2009 28/02/2010
R`000 R`000 R`000
Assets
Non-current assets
Tangible assets 436 363 353 964 332 505
Deferred taxation 10 871 6 706 10 530
Goodwill 2 685 - -
Investments in associates 15 439 15 808 16 436
Investment in joint venture - 13 008 14 056
465 358 389 486 373 527
Current assets
Trade and other receivables 129 771 89 400 69 410
Inventories 7 583 6 824 6 184
Taxation - 5 350 -
Cash and cash equivalents 82 663 76 081 88 506
220 017 177 655 164 100
Assets held for sale 4 384 - 3 249
Total Assets 689 759 567 141 540 876
Equity and Liabilities
Equity attributable to owners of
the parent
Share capital 194 194 194
Distributable reserves 286 346 270 210 276 148
Non-distributable reserves 48 831 43 180 49 681
335 371 313 584 326 023
Minority interest - - -
Total Equity 335 371 313 584 326 023
Non-current liabilities
Deferred taxation 46 834 43 004 43 673
Interest-bearing long-term loans 148 669 90 841 77 881
195 503 133 845 121 554
Current liabilities
Trade and other payables 91 037 76 761 53 462
Short term portion of interest- 64 840 42 951 35 361
bearing loans
Taxation 3 008 - 4 476
158 885 119 712 93 299
Total Equity and Liabilities 689 759 567 141 540 876
CONSOLIDATED STATEMENT
OF CHANGES IN EQUITY
Share Non- Foreign Total
Capital Distribu Distribu Currency Other
table table Translat reser
reserve reserves ion ves
Reserve
Balance at 31 194 42 851 270 210 279 50 313 584
August 2009
Transfers - 3 660 (3 660) - - -
between
reserves
Net profit for - - 11 442 - - 11 442
the half year
Other - 3 402 - (561) - 2 841
comprehensive
income/(loss)
for the half
year
Dividends paid - - (1 844) - - (1 844)
during the
half year
Balance at 1 194 49 913 276 148 (282) 50 326 023
March 2010
Net profit for - - 14 079 - - 14 079
the half year
Other - - - (850) - (850)
comprehensive
loss for the
half year
Dividends paid - - (3 881) - - (3 881)
during the
half year
Balance at 31 194 49 913 286 346 (1 132) 50 335 371
August 2010
CONSOLIDATED STATEMENT OF CASH FLOWS
Cash receipts from customers 230 702 166 777 442 235
Cash paid to suppliers and employees (214 303) (136 185) (384 373)
Cash generated by operations 16 399 30 592 57 862
Finance income 2 864 4 596 9 157
Finance costs (7 798) (9 499) (16 540)
Dividends paid (3 881) (1 746) (3 590)
Taxation (paid)/received (4 820) (624) 1 960
Cash inflow from operating 2 764 23 319 48 849
activities
Cash inflow/(outflow) from financing 100 966 9 741 (10 809)
activities
Cash outflow from investing (108 883) (60 391) (53 363)
activities
- Increase in loan to joint venture 997 (4 591) (6 667)
and associates
- Acquisition of shares in joint (1 000) - -
venture
- Investment in tangible assets (112 492) (60 970) (64 862)
- Proceeds on sale of tangible 3 612 5 170 18 166
assets
Decrease in cash during the period (5 153) (27 331) (15 323)
Cash at the beginning of the year 88 506 104 101 104 101
Foreign exchange movement during the (690) (689) (272)
period
Cash at the end of the period 82 663 76 081 88 506
Review
The growth in headline earnings per share of 19.3% and earnings per share of
5.2% is most pleasing in light of the operating pressures faced by many
companies in the current economic environment. Revenue has grown by 18.1%, of
which 10% represents real growth as a result of new business and increased
customer volumes. The remaining growth in revenue is attributed to increased
fuel prices and the consolidation of a joint venture company which was
previously equity accounted. Many of the new contracts awarded have on
average been in operation for 2.5 months during this period and their full
contribution should be more evident at year end. Operating and administration
costs as a percentage of revenue has increased by 0.5% in comparison to prior
period and year end and this increase is attributed to the set up costs of the
new operations as well as a R4 million provision for bad debt created for a
loan owing by an associate company to a subsidiary company in the Group.
The disposal of non-operating assets was initiated to generate positive cash
flows to be used for further capital expansion and acquisition opportunities
for the Group. Further non-core assets have been impaired and their book
values re-classified to `assets held for sale`, with the intention of
disposing of them within the next 12 months. The acquisition of the majority
shareholding in a joint venture company resulted in a positive fair value
adjustment of R1.78 million to the carrying value of this investment and
goodwill of R2.6 million being recognised on consolidation.
Operating profit before abnormal items has increased by 6.0%. Excluding the
effect of the provision for bad debt of R4 million raised for a receivable due
from associate company, would have increased operating profit before abnormal
items by 22.8%. Finance income and finance costs have decreased by 37.7% and
17.9% respectively, affected by the decrease in interest rates during the
period. Finance costs during the second half of the year is expected to be
higher due to the significant investment in tangible assets which have been
financed.
Prospects
The regional economy continues to strengthen amidst negative viewpoints
pertaining to a `double dip` recession. The Groups low gearing and current
cash position augers well for continued growth. Strategic acquisitions and
organic growth within the various business segments remain a core focus. The
industrial segment has benefitted from new business initiatives and increased
volumes. The agricultural segment was negatively affected by a R4 million bad
debt provision and is not expected to recover from this position this year.
Accounting Policies
The financial statements for the half-year ended 31 August 2010 have been
prepared in accordance with IAS 34, International Financial Reporting Standards
(IFRS), the requirements of the South African Companies Act, Act 61 of 1973,
and the Listing Requirements of the JSE Limited. The accounting policies are
consistent with those applied in the prior year financial statements. These
results have not been audited nor have they been reviewed by the group`s
auditors, Ernst & Young Inc.
Dividend Declaration
An interim dividend (no. 39) of 12.0 (2009: 9.5) cents per share for the six
month period ending 31 August 2010 has been declared to shareholders recorded
in the books of the company at the close of business on Friday 10 December
2010. The last date to trade cum dividend will be Friday 3 December 2010 and
the shares will trade ex dividend from the commencement of business on Monday 6
December 2010. The dividend will be paid on Monday 13 December 2010. Share
certificates may not be dematerialised / rematerialised between Monday 6
December 2010 and Friday 10 December 2010, both days inclusive.
Reclassification of prior year figures
Certain comparative figures in the consolidated statement of changes in equity,
consolidated statement of financial position and consolidated statement of cash
flows have been changed. This is due to the unrealised foreign exchange
movement on the foreign bank accounts being disclosed separately from cash
generated by operations and a re-allocation between deferred tax and non-
distributable reserves.
Registered Office
11A Grace Road
Mountainview, Observatory
2198
Transfer Secretaries
Computershare Investor Services (Proprietary) Limited
70 Marshall Street
Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Website
www.cargocarriers.co.za
Cargo Carriers Limited, Registration number :1959/003254/06
Incorporated in the Republic of South Africa ("Cargo Carriers" or " the
company")
JSE Share code: CRG
ISIN Code: ZAE000001764
By order of the board
MJ Bolton
Company Secretary
29 October 2010
Directors
S G Chilvers# (Chairman), G D Bolton (Joint CEO), M J Bolton (Joint CEO),
A E Franklin*, B B Fraser#, S Maharaj (Financial Director),
S P Mzimela*, V Raseroka*, M J Vuso*
# non-executive director
* independent non-executive director
Sponsor
Arcay Moela Sponsors (Pty) Ltd
Date: 01/11/2010 17:05:02 Produced by the JSE SENS Department.
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