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WOOLTRU LIMITED - FINANCIAL REPORT
Wooltru Limited
(Incorporated in the Republic of South Africa)
(Registration number 1936/008278/06)
("WOOLTRU")
Share Code: WLO ISIN Code: ZAE000007993
Share Code: WLN ISIN Code: ZAE000008744
Share Code: WLOP ISIN Code: ZAE000008009
Share Code: WLP1 ISIN Code: ZAE000008017
CHAIRMAN"S REVIEW (2004)
UNBUNDLING
All material outstanding operational issues relating to the unbundling have been
resolved. The final property holding has been sold at its valuation of R 0.5
million and all outstanding monies owed from these and other assets disposed of
have been collected. The collapsing of corporate structures within the Group
and the de-registration or liquidation of companies is continuing and good
progress towards a targeted voluntary liquidation is being made.
The process of finalising the liquidation of companies within the CNA Group,
which falls outside of Wooltru"s control, has, however, resulted in ongoing
uncertainties which, until such time as they can be resolved to the satisfaction
of the Board, will delay the ultimate winding-up of Wooltru.
CASH BALANCE
As at 20 February 2004, cash balances on hand amounted to R 199.8 m. Estimated
cash balances on hand at 30 June 2004 are budgeted at R 201.2 m.
The major components for which cash outflows have been budgeted are as follows:-
Accrued Property Related Costs 1.7
Advisors Costs 2.9
Employment Costs 1.1
Administration Costs 0.9
Preference Share Redemption 1.5
These costs will be offset by interest estimated to amount to R 9.5 m earned on
cash balances. The net cash inflow for the period is therefore budgeted at R
1.4 m.
CNA
The liquidators of CNA issued a supplementary report on the 26th of February,
proposing a series of actions in an effort to advance the final liquidation of
CNA. These proposals will be considered by a meeting of CNA"s creditors to be
held on the 11th of March 2004. Among the proposed actions are to set aside
Wooltru"s proven claim of R75 million, and to make Wooltru, together with Mr J
Newton, jointly liable for the debts and the liabilities of CNA, alternatively,
to seek judgement against them in the amount of R147.7 m. Wooltru intends to
vigorously defend these actions, having obtained legal advice that Wooltru"s
position is indeed defensible and that the actions are likely to fail in a court
of law. Regrettably, the series of actions proposed by the liquidators will
have the effect of delaying further the final liquidation of CNA and also of
creating further uncertainty as to the outcome.
The issue of post-retirement medical benefits for former CNA employees remains
unresolved. The claim brought against Johnnic by one of the retirees has been
set down for trial in October 2004. Johnnic has joined Wooltru as a third party
to this action. Based on legal advice, it is the Board"s view that no liability
exists for Wooltru.
GROUP RESULTS
In the current period, Wooltru recorded an attributable profit of R 6.0 m
compared to R 2.4 m for the six months ended 31 December 2002.
PROSPECTS
It is not possible to predict what impact the litigation surrounding CNA will
have on the proposed voluntary liquidation of Wooltru. Only once certainty has
been reached will the Board consider further dividends. In the intervening
period management will strive to keep the operating costs to a minimum. Beyond
30 June 2004 the company is expected to have a positive cash flow.
BALANCE SHEET AS AT 31 DECEMBER
Unaudited Audited
Six months ended 31 Year ende
December 30 June
2003 2002 2003
Notes Rm Rm Rm
ASSETS
Non-current assets 3.2 15.8 5.5
Property, plant and 2.9 15.5 5.3
equipment
Loans 0.3 0.3 0.2
Current assets 199.7 197.9 195.9
Inventories - 10.7 0.5
Trade and other 3.2 2.9 4.3
receivables
Taxation 1.3 12.2 0.6
Bank balances and cash 195.2 172.1 190.5
equivalents
Total assets 202.9 213.7 201.4
EQUITY AND LIABILITIES
Capital and reserves 194.0 171.3 188.0
Ordinary share capital 9.9 10.1 9.9
Share premium 620.1 621.2 620.1
Non-distributable reserves 8.1 8.1 8.1
Accumulated loss (444.1) (468.1) (450.1)
Preference share capital 1.5 1.5 1.5
Total equity 195.5 172.8 189.5
Non-current liabilities - 0.1 -
Deferred tax - 0.1 -
Current liabilities 7.4 40.8 11.9
Short-term liabilities: 0.4 - -
interest-bearing
Trade, other payables 4.9 15.9 9.1
Share incentive scheme 2.1 - 1.9
trust
Taxation - 24.9 0.9
Total equity and 202.9 213.7 201.4
liabilities
Net asset value per share 41 36 40
(cents)
CASH FLOW STATEMENT
Unaudited Audited
Six months ended 31 Year ende
December 30 June
2003 2002 2003
Rm Rm Rm
Cash flow from operating
activities
Cash flow from trading (4.9) (15.1) (15.0)
Working capital movements (2.2) (35.0) (30.1)
Cash utilised in operating (7.1) (50.1) (45.1)
activities
Interest received 11.3 9.9 21.5
Interest paid (0.1) (1.0) (0.5)
Income from investments 0.1 - 1.6
Taxation paid (2.4) (0.7) (15.7)
Cash generated 1.8 (41.9) (38.2)
by/(utilised in)
operations
Dividends paid - - (0.1)
Net cash inflow/(outflow) 1.8 (41.9) (38.3)
from operations
Cash flow from investing
activities
Investment to maintain - - (32.4)
operations
Net acquisition of - (22.9) -
property, plant and
equipment
Net loans and other (0.1) 73.5 74.2
investments
Proceeds from the sale of 2.6 - 24.9
property, plant and
equipment
Net cash inflow from 2.5 50.6 66.7
investing activities
Cash flow from financing
activities
Shares repurchased - - (1.3)
Net cash outflow from - - (1.3)
financing activities
Net increase in cash and 4.3 8.7 27.1
cash equivalents
Cash and cash equivalents 190.5 163.4 163.4
at beginning of period
Cash and cash equivalents 194.8 172.1 190.5
at end of period
INCOME STATEMENT
Unaudited Audited
Six months ended 31 Year ended
December 30 June
2003 2002 2003
Notes Rm Rm Rm
Revenue 2 10.9 18.5 43.0
Cost of sales (0.5) (6.5) (16.7)
Gross profit 10.4 12.0 26.3
Depreciation and (0.1) (0.1) (0.2)
amortisation
Occupancy costs (0.1) (0.1) (0.3)
Employment costs (2.0) (4.2) (7.9)
Other operating costs (2.8) (3.3) (4.3)
Profit from operations 5.4 4.3 13.6
Finance costs (0.2) (0.9) (0.5)
Net profit before 5.2 3.4 13.1
exceptional items
Exceptional items 3 1.6 3.5 12.6
Net profit before 6.8 6.9 25.7
taxation
Taxation (0.8) (4.5) (5.2)
Net profit after taxation 6.0 2.4 20.5
Preference dividends - - (0.1)
Net profit attributable 6.0 2.4 20.4
to ordinary shareholders
Number of shares issued 470.9 475.9 470.9
(millions)
Weighted average number 470.9 475.9 475.0
of shares (millions)
Earnings per share 1.3 0.5 4.3
(cents)
Diluted earnings per 1.3 0.5 4.3
share (cents)
Headline earnings/(loss) 4 1.2 (0.4) 1.5
per share (cents)
Dividend per share - - -
(cents)
GROUP ANALYSIS
Segment revenue * 10.9 18.5 43.0
Properties 0.5 6.4 16.5
Wooltru (includes 10.6 12.4 26.0
interest received)
Interest, dividends and (0.2) (0.3) 0.5
consolidation adjustments
Segment result ** 5.4 4.3 13.6
Properties (0.3) (0.6) (1.9)
Wooltru (includes 5.2 (0.6) 11.9
interest received and
paid)
Interest, dividends and 0.5 5.5 3.6
consolidation adjustments
* Excludes interest and dividends received except where indicated
** Excludes interest and dividends received and interest paid except were
indicated
STATEMENT OF CHANGES IN ORDINARY SHAREHOLDERS" INTEREST
Audited
Unaudited
Six months ended 31 Year ende
December 30 June
2003 2002 2003
Notes Rm Rm Rm
Ordinary shareholders" 188.0 168.9 168.9
interest
Movements for the period:
- - (1.3)
Share capital and share
premium
Share buy-back - - (1.3)
Recognised gains and
losses
Accumulated profit 6.0 2.4 20.4
Net profit 6.0 2.4 20.4
attributable to
ordinary shareholders
Ordinary shareholders" 194.0 171.3 188.0
interest at end of period
Six months ended Year ended
NOTES : Dec 2003 Dec 2002 June 2003
Rm Rm Rm
1 The interim financial statements are
prepared on the historical cost basis,
adjusted by the revaluation of certain
freehold land and buildings, lease premiums
and leasehold improvements. The group"s
significant accounting policies conform to
South African Statements of Generally
Accepted Accounting Practice. These
policies are consistent with those applied
in the previous year. It is the stated
intention to wind up the group once the
ongoing uncertainties have been resolved to
the satisfaction of the Board, and the
interim financial statements have been
prepared recognizing this intention. There
are no material differences between this
basis of preparation and preparation of the
financial information on the going concern
basis. This Financial report is prepared in
accordance with AC127, Interim Financial
Reporting.
2 Revenue
Interest income 10.4 11.4 22.6
Property development 0.5 6.4 16.5
Dividends received - - 1.6
Rental - 0.7 2.2
Other - - 0.1
10.9 18.5 43.0
3 The exceptional items relate to:
Profit on sale of land and buildings - 5.7 8.4
Unbundling expenses - (3.3) (4.6)
Reversal of property developments 1.2 (0.7) (0.5)
impairment/(impairment of)
Reversal of prior impairment of assets - 1.9 1.8
Impairment of assets (December 2002 - Jet - (19.6) -
Park)
Reversal of Jet Park onerous contract - 19.5 -
Retail Value Chain liquidation - capital - - 0.7
gains taxation
Sale of investments - - 0.3
Distribution from share incentive scheme 0.1 - 3.9
trust
Revaluation of property - - 2.6
Profit on sale of property, plant and 0.3 - -
equipment
Total 1.6 3.5 12.6
1.6 3.5 12.6
Taxation - 0.1 -
1.6 3.6 12.6
4 Headline earnings/ (loss) per share are
calculated as follows :
Net profit attributable to ordinary 6.0 2.4 20.4
shareholders
Net exceptional items (note 3) (1.6) (3.6) (12.6)
Re-inclusion of:
Reversal of property developments 1.2 (0.7) (0.5)
impairment/(impairment of)
Headline earnings/ (loss) 5.6 (1.9) 7.3
Headline earnings/ (loss) per share (cents) 1.2 (0.4) 1.5
5 Unutilised banking facilities amount to - - -
There is no limit on the group"s authority
to raise interest-bearing debt.
6 Future minimum operating lease commitments - 0.2 0.2
are as follows:
7 Contingent liabilities:
Guarantees to the City of Johannesburg in - 1.2 0.6
respect of the Kensington development
CNA post-retirement medical aid 20.0 - 20.0
liabilities *
* - Approaches have been made to Wooltru claiming a liability
exists on Wooltru"s part for the post-retirement medical
benefits of former employees of CNA. The best estimate of this
liability has been shown above. This claim is disputed.
8 In the current period there is no material seasonal variation
between trading for the first six months and the second six
months.
9 During the current period Wooltru Limited disposed of the Tirade
Properties subsidiaries for fair asset value. No profit nor loss was made
on these sales of the investments.
Wooltru Group Consolidation - December
2003
Directorate and administration
CHAIRMAN
L A Tager*
BA LLB, LLm, HDipTax
MANAGING DIRECTOR
J B Rabb
BSc (Agric), MBA
Executive Chairman:Wooltru Properties
FINANCE DIRECTOR
J D Newton
Bcom (Hons), LLB, CA(SA)
D M Lubner*
Transfer secretaries
J C van der Horst* South Africa
BA LLD Computershare Investor Services
* Non-executive Limited
11 Diagonal Street
Secretary Johannesburg, 2001
Credit Management Solutions Group (Pty)
Limited
Domicile and registered office Namibia
5 Corporation Street Transfer Secretaries (Pty)
Cape Town, 8001 Limited
South Africa Shop 12, Kaiserkrone Centre
Post Street Mall
Postal address Windhoek
P O Box 671, Cape Town, 8000
Telephone Number Principal bankers
(021) 464 1900 The Standard Bank of South Africa
Limited
Fax number
(021) 465-6891 Auditors
Ernst & Young
Web site
http://www.wooltru.co.za Legal Advisors
Mallinicks Attorneys
Company registration number Edward Nathan and Friedland (Pty)
1936/008278/06 Limited
Date: 8 March 2004
Date: 11/03/2004 05:00:10 PM Produced by the JSE SENS Department
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