|
OMN
OMN
OMN - Omnia Holdings Limited - Unaudited results for the six months ended 30
September 2010
OMNIA HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1967/003680/06
JSE code OMN
ISIN ZAE000005153
("Omnia" or "the Group")
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2010
OMNIA BENEFITS FROM STRATEGIC POSITIONING IN DIVERSE SECTORS
Major features:
Profit after tax of R167 million (2009: Loss R99 million)
Improved operating profit margin
Lower finance costs
Successful completion of R1 Billion Rights Offer
Key drivers
Strong demand for mining commodities
Stable but low commodity prices
Strong Rand
Low activity levels SA Manufacturing Sector
CONDENSED CONSOLIDATED INCOME STATEMENT
for the six months ended 30 September 2010
Rm Unaudited % Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Continuing operations
Revenue 4 268 - 4 249 8 827
Cost of sales (3 394) (10) (3 789) (7 438)
Gross profit 874 90 460 1 389
Other operating income 35 (10) 39 77
Distribution expenses (345) 13 (305) (674)
Administrative expenses (247) 4 (238) (487)
Other operating (24) (8) (26)
expenses
Operating profit/(loss) 293 664 (52) 279
Finance cost (59) (37) (93) (217)
Finance income 8 - 8 44
Share of post tax (3) 2 3
(losses)/ profits of
associates
Profit/(loss) before 239 277 (135) 109
income tax
Income tax (72) 36 (51)
(expense)/credit
Profit/(loss) for the 167 269 (99) 58
period
Profit/(loss)
attributable to:
Equity holders of the 165 267 (99) 56
company
Minority interest 2 - 2
167 269 (99) 58
Basic earnings per 341,4 256 (218,2) 122,0
share (cents)
Fully diluted basic 340,5 256 (217,8) 121,7
earnings per share
(cents)
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 September 2010
Rm Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Profit/(loss) for the 167 (99) 58
period
Other comprehensive
income,
net of tax
Movement in foreign (43) (263) (228)
currency translation
reserve
Movement in cash flow - - (8)
hedge
Total comprehensive 124 (362) (178)
income/(loss) for the
period attributable to:
Equity holders of the 122 (362) (180)
company
Minority interest 2 - 2
124 (362) (178)
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
for the six months
ended 30 September 2010
Rm Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Operating profit/(loss) 293 (52) 279
Depreciation and 73 61 142
amortisation
Adjustment for non-cash (42) (186) 106
items
(Utilised)/generated by (1 403) (32) 805
working capital
(1 079) (209) 1 332
Interest paid (59) (93) (217)
Interest received 8 8 44
Taxation paid (44) (85) (111)
(Utilised)/generated by (1 174) (379) 1 048
operations
Cash outflow from (478) (140) (466)
investing activities
Cash inflow from 928 511 180
financing activities
Dividends paid - (41) (40)
Net (decrease)/increase (724) (49) 722
in cash
Net cash/(overdraft) at 508 (214) (214)
beginning of period
Net cash and cash (216) (263) 508
equivalents
CONDENSED CONSOLIDATED BALANCE SHEET
as at 30 September 2010
Rm Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Assets
Non-current assets 2 347 1 766 1 944
Property, plant and 1 715 1 202 1 295
equipment
Intangible assets 524 505 537
Available-for-sale 18 1 19
financial assets
Investments in associates 86 48 84
Deferred income tax assets 4 10 9
Current assets 3 962 3 323 3 243
Inventories 1 913 1 597 1 315
Trade and other receivables 1 865 1 691 1 365
Current income tax assets - 4 -
Cash and cash equivalents 184 31 563
Total assets 6 309 5 089 5 187
Equity
Equity attributable to 3 075 1 745 1 973
owners of the company
Stated capital 1 303 317 318
Treasury shares (20) (10) (8)
Other reserves 18 (15) 54
Retained earnings 1 774 1 453 1 609
Minority interest in equity - (2) (2)
Total equity 3 075 1 743 1 971
Liabilities
Non-current liabilities 828 802 885
Interest-bearing borrowings 752 787 804
Deferred income tax 75 14 80
liabilities
Provisions 1 1 1
Current liabilities 2 406 2 544 2 331
Trade and other payables 1 861 1 787 2 166
Current portion of interest- 116 461 108
bearing borrowings
Current income tax 29 - 2
liabilities
Bank overdrafts 400 296 55
Total liabilities 3 234 3 346 3 216
Total equity and 6 309 5 089 5 187
liabilities
Net interest-bearing debt 1 084 1 513 404
Net asset value per share 46,4 37,5 42,4
(Rand)
Capital expenditure
Depreciation 59 53 119
Amortisation 14 9 23
Incurred 478 140 385
Authorised and committed 1 052 137 9
Authorised but not 162 341 420
contracted for
OTHER RESERVES
Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Share-based payment reserves 88 39 81
Foreign currency translation (65) (57) (22)
reserve
Cash flow hedge (8) - (8)
Net discount arising on 3 3 3
acquisition of shares of
subsidiaries
18 (15) 54
RECONCILIATION OF HEADLINE EARNINGS
Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Net profit/(loss) for the 165 (99) 56
period
Adjusted for loss on disposal - - 1
of fixed assets
Adjusted for profit on - - (20)
businesses contributed to
associate
Headline earnings/(loss) 165 (99) 37
HEADLINE EARNINGS
Headline earnings are 341,4 cents per share (2009: 218,2 cents loss per
share)
Diluted headline earnings are 340,5 cents per share (2009: 217,8 cents loss
per share).
SEGMENT ANALYSIS
for the six months ended 30 September 2010
Rm Unaudited % Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Revenue, net of 4 268 - 4 249 8 827
intersegmental sales
Chemicals 1 748 (5) 1 844 3 340
Mining 1 081 20 899 1 776
Agriculture 1 439 (4) 1 506 3 711
Operating profit 293 664 (52) 279
Chemicals 32 (46) 59 152M
Mining 172 61 107 212
Agriculture 89 141 (218) (85)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 September 2010
Ordinary shareholders` equity
Stated Treasury Other Retained Minority
Rm capital shares reserves earnings interest Total
At 31 March 2009 201 (11) 286 1 663 (2) 2 137
(audited)
Total recognised (263) (99) (362)
income and
expense for the
period
Loss for the (99) (99)
period
Decrease in (263) (263)
foreign currency
translation
reserve
Ordinary 26 (66) (40)
dividends paid
and
capitalisation
shares issued
Treasury shares 1 1
sold
Share-based 7 7
payment - value
of services
provided
Share-based 91 - (45) (44) (2) -
payment -
ordinary shares
issued
At 30 September 318 (10) (15) 1 454 (4) 1 743
2009 (unaudited)
Total recognised 27 155 2 184
income and
expense for the
period
Profit for the 155 2 157
period
Increase in 35 35
foreign currency
translation
reserve
Cash flow hedge (8) (8)
Treasury shares 2 2
sold
Share-based 42 42
payment - value
of services
provided
At 31 March 2010 318 (8) 54 1 609 (2) 1 971
(audited)
Total recognised (43) 165 2 124
income and
expense for the
period
Profit for the 165 2 167
period
Decrease in (43) (43)
foreign currency
translation
reserve
985 (12) 973
Ordinary shares
issued
Share-based 7 7
payment - value
of services
provided
At 30 September 1 303 (20) 18 1 774 - 3 075
2010 (unaudited)
Directors NJ Crosse (Chairman), FD Butler, JJ Dique, NKH Fitz-Gibbon*
(Finance Director), R Havenstein, HH Hickey, RB Humphris*
(Managing Director), Prof SS Loubser, Dr WT Marais, Mr HP
Marais (Alternate Director to Dr WT Marais), S Mncwango, J
Dique
*Executive Directors
Registered 1st Floor, Omnia House, 13 Sloane Street, Epsom Downs,
office Bryanston, Sandton
PO Box 69888, Bryanston 2021
Telephone (011) 709 8888
Transfer Link Market Services South Africa (Pty) Ltd,
secretaries 11 Diagonal Street, Johannesburg 2001
PO Box 4844, Johannesburg 2000
Sponsor One Capital
NOTES
Accounting policies
The consolidated condensed financial statements for the six months ended 30
September 2010 were prepared in accordance with International Financial
Reporting Standards (IFRS), IAS 34 - Interim Financial Reporting, AC 500
Standards as issued by the Accounting Practices Board and in compliance with
the Listing Requirements of the JSE Limited. The consolidated condensed
interim financial statements do not include all of the information required
by IFRS for full annual financial statements.
The principal policies used in the preparation of the results for the six
months ended 30 September 2010 are consistent with those applied in the
annual financial statements for the year ended 31 March 2010.
Commitments
The future minimum lease payments under non-cancellable operating leases are
R15 million (2009: R4 million) within one year and R50 million (2009: R1
million) between two and five years and R0 million (2009: R0 million) beyond
five years, giving a total of R65 million (2009: R5 million).
ADDITIONAL INFORMATION
Unaudited Unaudited Audited
6 months 6 months 12 months
30/9/2010 30/9/2009 31/3/2010
Final dividend paid per share - 150* 150*
(cents) in respect of prior year
Interim dividend declared per share - - -
(cents) in respect of current year
Weighted average number of shares 48 336 45 094 45 904
in issue (`000)
Weighted average number of fully 48 456 45 176 46 027
diluted shares in issue (`000)
Number of shares in issue (`000) 66 278 46 430 46 491
* Includes a capitalisation award of 150 cents as a final dividend
for the year. Shareholders could elect to receive a cash dividend
of 145 cents instead of the capitalisation award.
COMMENTARY
INTRODUCTION
Omnia is a diversified, specialist chemical services provider with business
interests balanced across chemical, mining and agricultural markets. The
Group`s model, which leverages its intellectual capital and technology,
differentiates it from commodity chemical companies.
The Group`s three business divisions (chemical, mining and agriculture)
continue to provide value add customised solutions built on a continually
expanding knowledge base. Omnia`s business model places it at the forefront
of the chemical services industry and involves uniquely matching customer
needs to product innovation and application expertise to add extraordinary
value to its customer`s businesses.
MARKET CONDITIONS
Overall market conditions were more stable than in 2009. Commodity prices in
general were marginally higher, albeit off low levels but the benefit
thereof was negated by the strong Rand such that Rand margins came under
pressure.
Significant different demand conditions existed in the markets of the three
divisions. Mining experienced buoyant conditions due to increased
international demand for coal, iron ore, copper and platinum. Chemicals
experienced tough trading conditions as low levels of activity persisted in
the South Africa manufacturing sector and selling prices came under pressure
due to the strong rand and relatively subdued commodity prices. Agriculture
conditions were mixed in that there was a poor winter wheat season, a bumper
maize harvest and lower domestic maize prices prevailed. The strong Rand and
subdued international fertilizer prices led to a small reduction in local
fertilizer prices.
FINANCIAL REVIEW
Revenue at R4 268 million was the same as the previous year and reflected
the effect of marginally lower sales prices offset by marginally higher
overall volumes.
Operating profit improved to R293 million (2009: R52 million loss).
Adjusting for the 2009 R350 million downward valuation of inventory,
operating profit was in line with the previous year.
Finance cost reduced by 37% due mainly to lower average working capital in
2010 compared to 2009 and further aided by lower interest rates.
Net working capital of R1?917 million (2009: R1?501 million) is in line with
the traditional peak seasonal requirements of the Agriculture division. The
Group`s net working capital requirements reach a peak in September/October
each year, and so does net interest bearing debt. The R1 billion equity
raising programme was completed on 14 September 2010 on which date the funds
were received. R467 million of the R1 billion has been utilised to fund
capital expenditure on the new Nitric Acid Complex and expenses associated
with the equity raising programme, and the balance of R533 million has been
applied to repay short term bank facilities resulting in net interest
bearing debt at R1 084 million being lower than the R1 513 million recorded
in 2009.
DIVISIONAL REVIEW
Chemicals
Protea Chemicals is a well established distributor and manufacturer of
speciality, functional and effect chemicals and polymers in southern and
eastern Africa. It was recently rated the 13th largest chemical distribution
company in a worldwide survey by the respected industry journal, ICIS
Chemical Business.
The tough trading conditions experienced saw revenue decline by 5% to R1?748
million (2009: R1 844 million) as selling prices reduced on the back of the
strong rand and volumes were flat year on year. Operating profit declined
46% to R32 million (2009: R59 million). Given the largely fixed nature of
overheads, an improvement in the gross margin percentage and a strong focus
on cost control were insufficient to compensate for the effect of the
reduced revenue but assisted in limiting the decline in operating profit.
Mining
The Mining division offers a broad range of services to the mining industry
through BME and Protea Mining Chemicals. BME is a market leader in
manufacture and supply of blended bulk explosives for surface mines and also
manufactures and supplies packaged explosives for underground mines and
shock tube and electronic delay detonators initiation systems. BME operates
throughout Africa. Protea Mining Chemicals operates in southern Africa and
offers value added services to complement its wide range of chemical
products.
Revenue increased by 20% to R1 081 million (2009: R899 million) on the back
of strong volume growth in surface and underground mining. Operating profit
improved 61% to R172 million (2009: R107 million) even with the strong rand
negatively impacting the translation of improved earnings from foreign
operations.
The new shock tube initiation system manufacturing facility is functioning
well and throughput increases month by month. The results of the most recent
trials of the latest generation Electronic Delay Detonator system are very
promising and commercialisation will commence in the near future.
Protea Mining Chemicals achieved volume increases but operating profit was
marginally below that of 2009. Anticipated growth continues to be affected
by delays in a number of customer`s expansion projects.
Agriculture
The Agriculture division produces and supplies granular, liquid and
speciality fertilizers to farmers, co-operatives and wholesalers throughout
southern and eastern Africa, Australasia and Brazil.
Revenue reduced by 4% to R1 439 million (2009: R1 506 million) on the back
of a small reduction in selling prices due to the strong rand whilst volumes
were at similar levels to the previous year. Operating profit of R89 million
was substantially ahead of the 2009 R218 million operating loss as the 2009
results included a downward valuation in inventory amounting to R350
million. Adjusting for this R350 million, operating profit was R43 million
below 2009 levels due to the impact on margins of the reduction in sales
prices and the additional input cost attributable to the purchase of more
expensive nitrogen materials, as internal nitric acid production capacity
was increasingly utilised to supply BME`s volume growth.
Construction of the new Nitric Acid Complex is proceeding according to plan.
The Phosphate plant at Phokeng has been placed on care and maintenance.
Omnia`s defence against the Competition Commission`s charges is progressing.
The seven year investigation into the alleged collusion within the
fertilizer industry continues.
PROSPECTS
Overall domestic commodity prices have stabilised, albeit at lower levels,
but the strong rand will negatively impact operating profit. The Group
expects to benefit from substantially lower finance costs.
The Chemical division is not expecting any material improvement in volumes
and prices and is therefore focusing on aggressive cost reductions and
efficiency improvements to improve operating profit.
The Mining division expects the favourable conditions of the first half to
continue in the second half reflecting strong demand for its products.
The Agricultural division performance will be influenced by fertilizer sales
volumes in the summer planting season. International fertilizer prices have
increased significantly as demand improves following the upward move in
agriculture produce prices. Some turbulence in the market is being
experienced because of the withdrawal by Yara from South Africa and the
Competition Commission ruling that requires Sasol to withdraw from the
fertilizer retail market, the effects of which are difficult to predict.
Overall, the Group expects effects to revert to the normal pattern of higher
second half earnings. This information has not been reviewed and reported on
by Omnia`s auditors.
CHANGES TO THE BOARD
Mr HP (Helgaard) Marais was appointed as a non-executive director in his
capacity as an alternate director to Dr WT Marais with effect from 3
December 2010.
Ms D Radley and Mr TR Scott resigned as independent non-executive directors
of the Company with effect from 3 December 2010.
DIVIDENDS
Shareholders were advised in the 2010 annual report that a dividend was not
likely to be declared this year in the light of the equity that was raised
to fund the Nitric Acid Complex. The board has confirmed this approach and
no dividend has been proposed.
NJ CROSSE RB HUMPHRIS NKH FITZ-GIBBON
Chairman Managing Director Finance Director
www.omnia.co.za
Bryanston
7 December 2010
Sponsor
One Capital
Date: 07/12/2010 07:05:03 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
| Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information. | |||||||||||||
| Other Profile Group sites: FundsData Online (unit trust data) | Profile Group corporate site | |||||||||||||
| [ Terms of Use | Privacy Policy | PAIA manual | FAQs/Help | Site Map | © Copyright Reserved 2026 ] | |||||||||||||
|
|||||||||||||
