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DLV
DLV
DLV - Dorbyl Limited - Interim group results for the six months ended 30
September 2010
Dorbyl Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 1911/001510/06)
Share Code: DLV ISIN Code: ZAE000002184
("the Company" or "the Group")
INTERIM GROUP RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2010
Income Statement
Unaudited
Unaudited 6 months to Audited
6 months to September Year to
September 2009 March
2010 Restated 2010
R`000 R`000 R`000
Continuing operations:
Revenue - - -
Cost of sales - - -
Gross profit - - -
Other operating income - - 2 349
Administrative expenses (4 777) (10 994) (13 988)
Other operating expenses
Employee benefit liabilities - 2 942
reversed -
Operating loss (4 777) (10 994) (8 697)
Net finance income 2 806 2 861 4 023
Finance income 2 912 2 967 4 427
Finance costs (106) (106) (404)
Share of loss of equity (7 916) (21 943)
accounted investee -
Loss before taxation (1 971) (16 049) (26 617)
Income tax expense - - -
Loss after taxation from (16 049) (26 617)
continuing operations (1 971)
Discontinued operations:
Profit/(loss) from discontinued (22 947) (87 185)
operations, net of taxation 1 496
Loss for the period (475) (38 996) (113 802)
Other comprehensive expense
Devaluation of property, plant (13 000) (5 000)
and equipment -
Other comprehensive (13 000) (5 000)
expense for the year, net of
income tax -
Total comprehensive loss for (51 996) (118 802)
the period (475)
Loss attributable to:
Equity holders of the parent (475) (28 270) (94 848)
Minority interest - (10 726) (18 954)
Loss for the period (475) (38 996) (113 802)
Total comprehensive loss
attributable to:
Equity holders of the parent (475) (41 270) (99 848)
Minority interest - (10 726) (18 954)
Total comprehensive loss for the (51 996) (118 802)
year (475)
Earnings per share (cents:) Cents Cents Cents
Basic and diluted (83.3) (279.6)
earnings/(loss) per share (1.4)
Continuing operations (5.8) (47.3) (78.5)
Discontinued operations 4.4 (36.0) (201.1)
Headline loss reconciliation: R`000 R`000 R`000
Loss for the period (475) (28 270) (94 848)
Adjusted for: 1 242 (8 040) 19 978
Profit on disposal of plant, (40) (237)
vehicles and equipment (1 288)
Loss on sale of discontinued - 7 500
operations -
(Reversal)/impairment of assets (750) (8 000) 9 942
Less: Minority interest - - (862)
Impairment/reversal of - (4 865)
investment in equity accounted 3 280
investees
Share of impairment of assets of - 8 500
equity accounted investees -
Headline profit/(loss) 767 (36 310) (74 870)
Headline and diluted (107.0) (220.7)
profit/(loss) per share 2.3
Continuing operations (5.8) (47.3) (78.5)
Discontinued operations 8.1 (59.7) (142.2)
Unaudited
Unaudited 6 months to Audited
6 months to September Year to
September 2009 March
2010 Restated 2010
R`000 R`000 R`000
Depreciation and amortisation 52 4 534 2 866
Continuing operations 52 832 431
Discontinued operations - 3 702 2 435
Finance income 2 912 6 728 11 780
Interest received 2 912 1 236 4 032
Foreign exchange gains - 5 492 7 748
Continuing operations 2 912 1 236 4 427
Discontinued operations - 5 492 7 353
Finance cost (106) (1 639) (16 960)
Interest paid - (11) (717)
Foreign exchange losses - (1 522) (16 031)
Interest paid - other (106) (106) (212)
Continuing operations (106) (106) (404)
Discontinued operations - (1 533) (16 556)
Balance Sheet
Unaudited
Unaudited 6 months to Audited
6 months to September Year to
September 2009 March
2010 Restated 2010
ASSETS R`000 R`000 R`000
Non-current assets - 47 019 103
Property, plant and equipment - 28 231 103
Investment in associates - 18 788 -
Current assets 231 472 366 130 346 195
Inventories - 4 497 -
Taxation receivable - 1 056 -
Trade and other receivables 2 929 19 237 25 598
Employee benefits 2 821 - 2 821
Cash and cash equivalents 154 680 59 187 64 685
Assets classified as held for 71 042 282 153 253 091
sale
Total assets 231 472 413 149 346 298
Unaudited
Unaudited 6 months to Audited
6 months to September Year to
September 2009 March
2010 Restated 2010
R`000 R`000 R`000
EQUITY AND LIABILITIES
Total equity 166 115 233 396 166 590
Equity attributable to equity 223 858 165 280
holders of the parent 164 805
Minority interest 1 310 9 538 1 310
Non-current liabilities 27 893 26 684 27 891
Preference share capital 3 980 3 980 3 980
Employee benefits 23 913 22 704 23 911
Current liabilities 37 464 153 069 151 817
Bank overdraft - - 22 602
Trade and other payables 14 698 22 000 23 829
Employee benefits - 1 360 -
Provisions 300 770 300
Taxation payable - - -
Liabilities classified as held 128 939 105 086
for sale 22 466
Total equity and liabilities 231 472 413 149 346 298
Assets classified as held for
sale
Property, plant and equipment 19 861 106 856 101 161
Investment in equity accounted - 10 118
investee 5 718
Inventories 14 460 91 656 62 490
Trade and other receivables 28 659 81 065 75 120
Tax receivable 165 - 165
Cash and cash equivalents 2 179 2 576 4 037
71 042 282 153 253 091
Liabilities classified as held
for sale
Deferred tax liabilities - 138 156
Minority shareholders for 2 161 2 161
dividends -
Trade and other payables 126 640 102 692
including derivatives 22 461
Taxation payable 5 - 77
22 466 128 939 105 086
Capital commitments authorised - 208 -
Authorised and contracted for - 208 -
Authorised but not contracted for - - -
Operating lease commitments 5 593 10 043 10 340
Operating lease receivables 3 228 191 437 191 955
Investments in equity accounted 18 788 10 118
investee - current year
classified as held for sale 5 718
Net asset value per share (cents) 486 660 487
Acquisition of property, plant
and equipment
Expansion - 3 332 3 990
Replacement 3 194 1 830 2 352
-
Ordinary shares (000)
Issued - net of treasury shares 33 924 33 924 33 924
Weighted average number of shares 33 924 33 924
- net of treasury shares 33 924
Cash Flow Statement
Unaudited
Unaudited 6 months to Audited
6 months to September Year to
September 2009 March
2010 Restated 2010
R`000 R`000 R`000
Cash utilised by operations (11 328) (27 669) (81 357)
Operating cash flow (2 737) (35 741) (80 078)
Movement in working capital (8 485) 8 664 (1 119)
Interest expense (106) (117) (929)
Income taxes paid - (475) 769
Cash flows from investing 30 805 68 850
activities 122 067
Interest income 2 912 1 236 4 032
Proceeds on disposal of 36 000 62 922
property, plant and equipment 75 588
Acquisition of property, plant (5 162) (6 342)
and equipment (3 194)
Disposal of discontinued - 10 000
operations net of cash disposed
of 43 641
Decrease in investments in (1 269) (1 762)
subsidiaries/associates 1 120
Net decrease in cash and cash 3 136 (12 507)
equivalents 110 739
Cash and cash equivalents at 51 431 51 431
beginning of period 42 083
Classified as held for sale at 7 196 7 196
beginning of period 4 037
Classified as held for sale (2 179) (2 576) (4 037)
Cash and cash equivalents at end 59 187 42 083
of period 154 680
Statement of changes in equity
Stated Reserves Equity Minority
capital holders interest
Retained of the Total
earnings parent equity
R`000 R`000 R`000 R`000 R`000 R`000
Balance at 1 11 248 106 017 265 128 20 264
April 2009 147 863 285 392
Loss for the - - (28 270) (10 726)
period (28 270) (38 996)
Revaluation - (13 000) - (13 000) - (13 000)
of property
plant and
equipment
Total income - (13 000) - (13 000) - (13 000)
loss for the
period
Balance at 11 248 93 017 119 593 223 858 9 538 233 396
30 September
2009
Loss for the - - (66 578) (66 578) (8 228) (74 806)
period
Other
comprehensiv
e expense
Devaluation - 8 000 - 8 000 - 8 000
of property
plant and
equipment
Transfer of - (26 326) 26 326 - - -
revaluation
reserve on
sale of
property
Depreciation - (225) 225 - - -
on
revaluation
of property
Total loss - (18 551) 8 000 - 8 000
for the
period 26 551
Balance 31 11 248 74 466 79 566 155 280 1 310 166 590
March 2010
Loss for the - - (475) (475) - (475)
period
Transfer of - (69 716) 69 716 - - -
revaluation
reserve on
sale of
property
Total loss - (69 716) 69 716 - -
for the -
period
Balance 30 11 248 4 750 148 807 164 805 1 310 166 115
September
2010
REVIEW OF OPERATIONS AND INTERIM GROUP RESULTS
Net cash position
The net cash position at R156,9 million, including cash classified as held for
sale, is R110,7 million higher than the position at 31 March 2010 mainly due to
the receipt of the proceeds from the disposals of Guestro Forging and Machining,
Dorbyl Automotive Systems and the Uitenhage, Struandale and Rosslyn properties.
At 30 September 2010, the only outstanding sale agreement proceeds relate to the
disposal of the 50% interest in Dorbyl Magnetto Wheels to the joint venture
partner, Magnetto Wheels S.p.A., for a consideration of R5,6m. The receipt of
such proceeds, which are currently held in trust, is pending approval of the
disposal by the Competition authorities.
Net asset value as at 30 September 2010
The net asset value is mainly attributable to cash, Guestro Castings, the Benoni
Property, Corporate Head Office and the historical employee benefit liabilities.
The net asset value per share as at 30 September 2010 of 486 cents per share is
comparable to the 487 cents per share as at 31 March 2010. In this regard it
should be noted that, as stated in prior announcements, the Group`s accounting
policy is to carry properties at a revalued amount, being the fair value at the
date of revaluation until such time as it is held for sale. Due to the held for
sale rules in terms of IFRS5, the carrying value of the Benoni property at 30
September 2010 is 43 cents per share less than the valuation as determined by
the directors. The net asset value per share of 486 cents does therefore not
include this additional 43 cents of perceived value. The net asset value does
not consider the possible impact of Secondary Tax on Companies (STC).
It should be noted that Univel Transmissions ceased production and the closure
has virtually been completed as at 30 September 2010. The prior comparative
period results have been restated as discontinued operations for comparative
purposes.
Results
The results in respect of the prior periods related to the Group`s businesses
which operated mainly in the automotive industry. Pursuant to the several
business disposals now concluded, the remaining operating business is Guestro
Castings, which operates in the automotive and general engineering sectors.
Headline earnings attributable to equity holders of the parent was R0,8m or 2,3
cents per share, which was mainly attributable to Guestro Castings, the Benoni
Property and the Corporate Head Office.
For the second half of the year, the Group intends to further improve
operational efficiencies and to diversify the customer base at Guestro Casting.
In addition, further measures to decrease costs at the Corporate Head Office are
being implemented. The operating conditions are expected to remain challenging
due to the uncertain recovery in market demand and the current US dollar
exchange rate`s impact on the risk of import substitution.
Segmental reporting
The primary segment during the period was automotive component manufacturing and
general engineering. In terms of the geographical segment, automotive component
manufacturing and general engineering is considered to be a South African
operation. Due to the fact that the whole business is considered as one
segment, no segmental reporting has been provided.
Subsequent events
The Company declared a Special Dividend amounting to 150 cents per share on 18
October 2010. The dividend is payable on 22 November 2010.
Other than the Special Dividend declaration referred to above, no matters which
are material to the financial affairs of the Company or the Group have occurred
between the balance sheet date and the date of the approval of the interim group
results.
Basis of preparation
The results for the six months ended 30 September 2010 have been prepared in
accordance with International Financial Reporting Standards (IFRS), IAS 34 -
Interim Financial Reporting, AC500 as issued by the Accounting Practices Board,
the South African Companies Act and the Listings Requirements of the JSE
Limited. The accounting policies are consistent to those applied in the prior
comparative period.
Dividend
No ordinary dividend has been declared in respect of the period under review.
On behalf of the board
JB Magwaza (Chairman)
R Rohrs (Chief Executive)
19 November 2010
Registered Office:
13 Lincoln Road, Industrial Sites, Benoni South, 1501
Transfer Secretaries:
Computershare Investor Services (Proprietary) Limited
70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Company Secretary: BD Bhikha
Sponsor: PSG Capital (Proprietary) Limited
Auditors: KPMG Inc
Directors: JB Magwaza (Chairman)**, RF Rohrs (Group Chief Executive)*, PM
Bester**, JW Dreyer***, TA Morkel**, BP Wood*, T van Wyk***
*Executive director **Independent non-executive director *** Non-executive
director
Date: 19/11/2010 17:00:01 Produced by the JSE SENS Department.
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