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NCS
NCS
NCS - Nictus Limited - Interim Results 30 September 2010
Nictus Limited
(Incorporated in the Republic of South Africa)
(Registration number 1981/001858/06)
JSE Share code: NCS
NSX Share code: NCT
ISIN Code: NA0009123481
("Nictus" or "the company")
Nictus Limited - Interim Results 30 September 2010
Unaudited Audited
CONDENSED CONSOLIDATED STATEMENT OF
COMPREHENSIVE INCOME
Six Six Year
months months
ended ended ended
30 Sept 30 Sept 31 Mar 10
10 09
R`000 R`000 R`000
Revenue 194 522 184 672 384 587
Cost of sales (142 746) (118 605) (256 650)
Claims incurred (11 892) (27 868) (44 847)
Gross profit 39 884 38 199 83 090
Other income 2 736 1 654 3 758
Investment income from 14 517 11 862 26 606
operations
Operating and administrative (53 365) (45 550) (101 555)
expenses
Operating 3 772 6 165 11 899
profit
Investment 3 899 1 888 5 071
income
Operating profit before 7 671 8 053 16 970
financing costs
Financing costs (2 241) (2 750) (5 229)
Profit before 5 430 5 303 11 741
taxation
Taxation (2 024) (2 209) (1 661)
Profit for the 3 406 3 094 10 080
period
Other - - 13 429
comprehensive
income
Total comprehensive income for the 3 406 3 094 23 509
period
Profit and total comprehensive income
attributable to:
Equity 3 406 3 094 23 509
holders
Basic earnings per share 6.41 5.85 18.96
(cents)
Diluted earnings per share 6.37 5.79 18.86
(cents)
Number of shares in issue 53 177 52 912 53 177
(000`s)
CONDENSED CONSOLIDATED STATEMENT OF
FINANCIAL POSITION
at 30 at 30 Sept at 31
Sept 10 09 Mar 10
R`000 R`000 R`000
ASSETS
Non-current assets
Investment 16 217 - 16 217
property
Property, plant 73 589 57 628 73 109
and equipment
Intangible 2 238 2 125 2 082
assets and
goodwill
Investments 33 545 31 465 31 036
Loans and 244 103 219 240 242 037
receivables
Deferred tax 13 992 13 650 14 535
assets
383 684 324 108 379 016
Current assets 462 445 387 488 429 604
Total assets 846 129 711 596 808 620
EQUITY
Share capital 26 589 26 456 26 589
Revaluation 30 431 17 002 30 431
reserve
Contingency 24 632 20 647 21 282
reserve
Retained income 17 572 14 505 20 856
Total equity 99 224 78 610 99 158
LIABILITIES
Non-current
liabilities
Interest bearing loans and 11 799 21 659 11 936
borrowings
Deferred tax 14 549 8 085 11 309
liabilities
26 348 29 744 23 245
Current 720 557 603 242 686 217
liabilities*
Insurance 616 441 465 550 574 148
contract
liability
Other current 104 116 137 692 112 069
liabilities
Total 746 905 632 986 709 462
liabilities
Total equity 846 129 711 596 808 620
and liabilities
* Included in current liabilities is the insurance contract
liability. Premiums received under this liability are invested in
terms of the respective insurance acts enacted in Namibia and South
Africa with the result that certain investments are of a long term
nature.
Unaudited Audited
CONDENSED CONSOLIDATED STATEMENT OF
CASH FLOW
Six Six months Year
months
ended ended ended
30 Sept 30 Sept 09 31 Mar 10
10
R`000 R`000 R`000
Cash flow from operating
activities
Cash generated 30 595 60 957 152 646
by operations
Investment income from 3 856 3 610 9 850
operations received
Interest paid (2 241) (2 750) (5 229)
Ordinary 5 353 8 252 16 756
dividends
received
Taxation (2 059) 2 068 (2 689)
refunded /
(paid)
Net cash flow from 35 504 72 137 171 334
operating activities
Net cash flow from 6 463 (45 839) (78 513)
investing activities
Net cash flow from (8 647) 5 107 (18 346)
financing activities
Net increase in cash and cash 33 320 31 405 74 475
equivalents
Cash and cash equivalents at beginning 237 982 163 507 163 507
of period
Cash and cash equivalents at end of 271 302 194 912 237 982
period
CONDENSED SEGMENTAL REPORT
Six Six months Year
months
ended ended ended
30 Sept 30 Sept 09 31 Mar 10
10
R`000 R`000 R`000
Segment assets
Motor retail 128 063 85 647 119 119
Furniture 97 845 78 694 92 294
retail
Insurance & 756 034 627 080 728 081
Finance
981 942 791 421 939 494
Head office and (135 813) (79 825) (130 874)
eliminations
846 129 711 596 808 620
Segment revenue
Motor retail 139 920 113 022 248 075
Furniture 36 931 29 183 61 541
retail
Insurance & 25 218 44 348 78 465
Finance
202 069 186 553 388 081
Head office and (7 547) (1 881) (3 494)
eliminations
194 522 184 672 384 587
Operating profit / (loss) - - -
after taxation
Motor retail 2 015 1 553 1 910
Furniture 1 748 245 (3 023)
retail
Insurance & 4 395 9 139 22 660
Finance
8 158 10 937 21 547
Head office and (4 752) (7 843) (11 467)
eliminations
3 406 3 094 10 080
RECONCILIATION BETWEEN EARNINGS &
HEADLINE EARNINGS
Six Six months Year
months
ended ended ended
30 Sept 30 Sept 09 31 Mar 10
10
Profit for the 3 406 3 094 10 080
period
Loss on disposal of property, plant 13 - 50
and equipment
Headline 3 419 3 094 10 130
earnings
Headline earnings per share 6.43 5.85 19.05
(cents)
CONDENSED CONSOLIDATED STATEMENT OF
CHANGES IN EQUITY
Share Revaluation Conting Retained Total
capital reserve ency income equity
reserve
R`000 R`000 R`000 R`000 R`000
Balance at 1 26 456 17 002 16 989 18 409 78 856
April 2009
Total - - - 3 094 3 094
comprehensive
income
Profit for the - - - 3 094 3 094
period
Transfer from - - 3 658 (3 658) -
contingency
reserve
Dividend paid - - - (3 340) (3 340)
Transfer from - - - -
treasury shares
Balance at 30 26 456 17 002 20 647 14 505 78 610
September 2009
Total - 13 429 - 6 986 20 415
comprehensive
income
Profit for the - - - 6 986 6 986
period
Revaluation of - 13 429 - - 13 429
land and
buildings
Transfer to - - 635 (635) -
contingency
reserve
Transfer from 133 - - - 133
treasury shares
Balance at 31 26 589 30 431 21 282 20 856 99 158
March 2010
Total - - - 3 406 3 406
comprehensive
income
Profit for the - - - 3 406 3 406
period
Transfer to - - 3 350 (3 350) -
contingency
reserve
Dividend paid - - - (3 340) (3 340)
Transfer from - - - - -
treasury shares
Balance at 30 26 589 30 431 24 632 17 572 99 224
September 2010
NOTES TO THE FINANCIAL INFORMATION
1. BASIS OF PREPARATION
The interim financial statements have been prepared in accordance with
the recognition and measurement criteria of International Financial
Reporting Standards (IFRS) and its interpretations adopted by the
International Accounting Standards Board (IASB), the Companies Act and
the AC 500 series. The accounting policies are consistent with those
applied for the year ended 31 March 2010. Standards and
interpretations effective subsequent to this date have not had a
material effect on the results. These interim financial statements
also comply with the recognition, measurement, presentation and
disclosure requirements of IAS 34 - Interim Financial Reporting.
2. FOREIGN CURRENCY
The Group`s functional currency is Namibia dollars. As the entity`s
primary listing is on the Johannesburg Stock Exchange, the interim
financial statements have been presented in South African Rands being
the Group`s presentation currency. The Namibia Dollar and the South
African Rand are translated on a one-to-one basis.
3. COMPARATIVE FIGURES
The September 2009 comparatives are consistent with the accounting
policies and basis of presentation applied to both the current period
and the previous year ended 31 March 2010.
4. RELATED PARTIES
During the period, certain companies within the Group entered into
transactions with each other. These intra-group transactions have been
eliminated on consolidation. Related party information is unchanged
from that reported at 31 March 2010. Refer to the 2010 annual report
for further information.
REVIEW OF OPERATIONS
Profit before taxation
Group revenue increased by 6% to R195 million.
The Group`s asset base increased by 19% to R846 million.
Gross profit increased by 4% to R40m.
Profit before taxation remained consistent with prior year
Cost of sales increased by 20% to R143 million.
Operating and administrative expenses increased by 17% to
R53 million.
Headline earnings increased by 10% to 6.43 cents per
share.
Overview of first six months
The profit after taxation remained consistent compared to the first
six months of the prior period. Positive growth was experienced in
the vehicle and furniture segments of the group during the first six
months. The insurance and finance division did not perform as well as
in the comparative period.
The growth experienced in the motor and furniture division is the
culmination of certain strategies for growing these segments. Under
the prevailing economic conditions the result of the group was in
line with the expectations of the board.
SEGMENTAL RESULTS
There was no change in the segments from the 31 March 2010 annual
report.
Motor retail: Increases in the revenue for all departments in this
segment contributed to the 24% increase in segment revenue. During
the first six months a new General Motors dealership was opened in
Otjiwarongo with a branch in Oshakati. Another General Motors
dealership was acquired in Walvisbay with a branch in Swakopmund
during October 2010, but finalisation of the transaction is subject
to the approval of the Competition Commission. The board expects that
various scale of economic benefits will arise from the expansion of
the motor segment as well as improved service to customers in
Namibia.
Furniture retail: Revenue increased by 27% compared to September 2009
and profitability increased significantly compared to the prior
period. The increase in profit is mainly due to increased sales in
both Namibia and South Africa. A new branch will be opened in Soweto
during November 2010.
Insurance and finance: The premium income for the first 6 months
decreased compared to the comparable period which negatively affected
profitability in the segment. Investment income remained under
pressure due to the continuous decrease in the prime rate in South
Africa. The good performance of equities on the JSE contributed to an
increase of investment income.
HEADLINE EARNINGS
For the year to date the only item that impacted on the headline
earnings was the loss on sale of equipment.
BASIC EARNINGS PER SHARE
Earnings per share for the six months ended 30 September 2010 was
6.41 cents (30 September 2009: 5.85 cents), compared to headline
earnings per share of 6.43 cents (30 September 2009: 5.85 cents).
DIVIDEND
No interim dividend has been proposed by the Board of
directors.
DIRECTORS
On 1 April 2010 WO Fourie was appointed as Group financial director
and on 15 June 2010 Prof BJ Willemse was appointed as a non-executive
director. FR van Staden, the previous financial director, remains an
executive director of the group.
PROSPECTS
The economic environment remained challenging during the first six
months as the recovery of the global economy remains under pressure.
The general expectation is that the South African and Namibian
economy will continue to recover over time and this will have a
positive effect on the performance of the Group. In addition, the
increased mining activity near the Namibian coast will positively
affect the Namibian economy. The expansion in the motor and furniture
divisions are expected to have a positive effect on future profits.
Historically the majority of the Group`s earnings are earned in the
second part of the financial year and the board is of the opinion
that the same will apply in the current financial year.
On behalf of the board:
N C Tromp
W O Fourie
Windhoek, 9 December 2010
COMPANY DETAILS
Company registration number: RSA: 1981/01858/06,
NAM: F81/11858
JSE share code: NCS, NSX Share code: NCT, ISIN
number: NA0009123481
Directors: J L Olivier (Chairman), N C Tromp (Managing Director), J N
Campbell (Non-executive), B J Willemse (Non-executive), F R van
Staden (Executive Director), J J Retief (Human Resources), W O Fourie
(Financial Director).
Transfer Secretaries: Computershare Investor Services 2004 (Pty) Ltd,
P O Box 61051, Marshalltown 2107
RSA Registered Office: Nictus Building, corner of Pretoria and Dover
Street, Randburg (P O Box 2878, Randburg, 2125)
Namibia Registered Office: 3rd Floor, Corporate House, 17 Luderitz
Street, Windhoek (P O Box 755, Windhoek)
Sponsor on the JSE: KPMG Services (Pty) Ltd
Sponsor on the NSX: Namibia Equity Brokers (Pty) Ltd
Johannesburg
9 December 2010
Sponsor on the JSE: KPMG Services (Pty) Ltd
Sponsor on the NSX: Namibia Equity Brokers (Pty) Ltd
Date: 09/12/2010 07:05:14 Produced by the JSE SENS Department.
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