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WTL
WTL
WTL - William Tell Holdings Limited - Unaudited results for the six months ended
31 December 2010
WILLIAM TELL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number: 2004/030045/06)
Share Code: WTL ISIN: ZAE000098133
("William Tell" or "the Group")
www.williamtellholdings.co.za
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2010
Summarised Consolidated Statements Audited
of Comprehensive Income Unaudited Unaudited
December December June
2010 2009 2010
R`000 R`000 R`000
Revenue 92 832 74 320 139 484
Cost of sales (71 370) (60 078) (117 472)
Gross profit 21 462 14 242 22 012
Other income 270 13 607 12 566
Administrative and other operating (16 473) (13 324) (61 685)
expenses
Operating profit / (loss) 5 259 14 525 (27 107)
Investment Income 658 - 425
Foreign exchange loss (91) (32) (21)
Interest paid (3 386) (3 782) (7 198)
Profit / (loss) before taxation 2 440 10 711 (33 901)
- - -
Taxation (756) 754 13 210
Profit / (loss) for the period 1 684 11 465 (20 691)
Depreciation and amortisation for 5 579 5 075 11 126
the period
Basic and diluted basic earnings / 1.3 9.2 (16.6)
(loss) per share (cents)
Headline and diluted headline 1.3 (1.4) (2.5)
earnings / (loss) per share (cents)
Reconciliation of basic earnings /
(loss) to headline earnings / (loss)
Basic earnings / (loss) 1 684 11 465 (20 691)
Adjusted by the after tax effect of
the following:
- Profit on the sale of property, (27) (13 178) (7 447)
plant and equipment
- Impairment of property, plant and - - 25 026
equipment
Headline earnings / (loss) 1 657 (1 713) (3 112)
Number of ordinary shares in 125 000 125 000 125 000
issue(`000)
Weighted average number of 125 000 125 000 125 000
shares(`000)
Summarised Consolidated Statements Unaudited Unaudited Audited
of Changes in Equity December December June 2010
2010 2009 R`000
R`000 R`000
Share Capital
Balance at the beginning of the year 1 250 1 250 1 250
Shares issued during the period - - -
Balance at the end of the period 1 250 1 250 1 250
Share premium
Balance at the beginning of the year 179 265 179 265 179 265
Share issue expenses - - -
Balance at the end of the period 179 265 179 265 179 265
Accumulated profit
Balance at the beginning of the year 10 310 31 001 31 001
Profit for the period 1 684 11 465 (20 691)
11 994 42 466 10 310
Summarised Consolidated Statements Unaudited Unaudited Audited
of Financial Position December December June 2010
2010 2009 R`000
R`000 R`000
ASSETS
Non-current assets 217 859 271 761 221 538
Property, plant and equipment 217 844 271 719 221 506
Intangible assets 15 42 32
Current assets 85 367 68 349 68 376
Inventories 29 563 27 826 27 051
Trade and other receivables 31 711 21 682 29 971
Current taxation receivable - - -
Cash and cash equivalents 24 093 18 841 11 354
Non-current assets held for sale - - 8 000
303 226 340 110 297 914
EQUITY & LIABILITIES
Capital & reserves 192 509 222 981 190 825
Share capital 1 250 1 250 1 250
Share premium 179 265 179 265 179 265
Accumulated profit 11 994 42 466 10 310
Non-current liabilities 59 152 79 335 59 800
Interest bearing borrowings 43 852 60 941 54 688
Deferred Taxation 3 524 15 293 2 151
Deferred Income 11 776 3 101 2 961
Current liabilities 51 565 37 794 47 289
Trade and other payables 29 043 12 676 24 056
Interest bearing borrowings 20 644 19 082 17 347
Provisions 1 282 861 906
Current taxation payable 596 5 175 4 980
303 226 340 110 297 914
Net asset value per share (cents) 154 178 153
Capital expenditure for the period 1 615 11 393 13 522
(R`000)
Summarised Consolidated Cash Flow Unaudited Unaudited Audited
Statements December December June 2010
2010 2009 R`000
R`000 R`000
Net cash generated by operations 12 581 7 607 2 788
Net finance costs (2 728) (3 782) (6 773)
Taxation paid (4 961) (404) (52)
Cash flow from operating activities 4 892 3 421 (4 037)
Cash flow from investing activities 15 386 26 904 34 857
Cash flow from financing activities (7 539) (26 079) (34 061)
Movement in cash & cash equivalents 12 739 4 246 (3 241)
Cash & cash equivalents at the 11 354 14 595 14 595
beginning of the year
Cash & cash equivalents at the end 24 093 18 841 11 354
of the period
Segment report
This is a single segment group and no segmental reporting is
provided.
COMMENTARY
HIGHLIGHTS
* 25% revenue growth
* 21% increase in gross margin
* 38% increase in recurring EBITDA
* 6 sales outlets opened in 6 provinces
* R8.5m debt settled in this period
* Gearing reduced to 34%
OVERVIEW OF THE BUSINESS
William Tell is a mass producer of wood-based panels. The Group is vertically
integrated with all manufacturing operations consolidated on one site in the
industrial area of Chamdor in Krugersdorp. Activities range from production of
chipboard from wood waste, application of melamine and other decorative surfaces
to production of furniture elements and ready to assemble furniture. The
integration strategy was expanded through the establishment of seven regional
sales outlets between April 2010 and January 2011 covering the major centres in
6 provinces.
SIX MONTH OPERATIONAL REVIEW
Revenue and gross margin growth of 25% and 21% respectively, were achieved in
the period through increased market penetration from the new sales outlets.
However, this lead to increased operating costs including non-recurring start up
costs of stores opened in this period.
Operating profit increased by R3.3m after excluding the once off R12.6m capital
profit on the sale of the Reuven property in the comparative period. Recurring
EBITDA has also increased by 38%.
Stock and trade debtors increased in line with the roll out of sales outlets and
escalating revenue growth to December. Debtor`s settlement periods increased as
customers experienced the pressure of the current difficult trading conditions.
Management continues to exercise tight control over debtor collections.
During this period we received the first tranche of R9m of an approved R30m tax
free cash grant from the DTI, as well as R8m proceeds from assets held for sale
as at 30 June 2010.
PROSPECTS
We are not expecting a substantial increase in demand for our products as market
conditions are expected to remain subdued but additional revenues should be
generated through existing and planned sales outlets.
A further tranche of R6m of the DTI tax free cash grant is
expected before April 2011.
DIRECTORS
Warwick Lok retired as a director and employee during December
2010. We wish him a happy retirement and thank him for his
considerable contribution to the development of the Group over
the past 17 years. Wally Van Coller joined the operating
subsidiary as Managing Director on 1 July 2010 and was appointed
to the board of William Tell Holdings on 1 October 2010. Wally
has a wealth of experience in managing manufacturing businesses
and we look forward to his contribution to the Group.
DIVIDENDS
In the light of the current market conditions, the directors
regard it prudent not to declare an interim dividend.
SUBSEQUENT EVENTS
No matters which are material to the financial affairs of the
Group have occurred between the balance sheet date and the date
of this report.
BASIS OF PREPARATION
These summarised consolidated interim financial statements have
been prepared in accordance with International Financial
Reporting Standards ("IFRS"), IAS 34: "Interim Financial
Reporting", the AC500 series as issued by the Accounting
Practices Board, the South African Companies Act, as amended, and
the Listings Requirements of the JSE Limited. The principal
accounting policies used in the preparation of the unaudited
results for the period ended 31 December 2010 are consistent with
those applied for the year ended 30 June 2010 and for the six
months ended 31 December 2009.
BY ORDER OF THE BOARD
R B Patmore (Chairman)*, B P Lok (Chief Executive Officer), N
Govender (Financial Director), W van Coller, N de Winnaar, M G
Meehan*
*Independent, non-executive
17 February 2011
REGISTERED ADDRESS:
31 Van Eck Street
Chamdor
Krugersdorp
1740
COMPANY SECRETARY:
Sirkien van Schalkwyk
No 1 Carlsberg
430 Nieuwenhuyzen Street
Erasmuskloof, 0048
DESIGNATED AND CORPORATE ADVISOR:
PSG Capital (Proprietary) Limited
Ground Floor, DM Kisch House
Inanda Greens Business Park
54 Wierda Road West
Wierda Valley
Sandton, 2196
TRANSFER SECRETARIES:
Computershare Investor Services (Proprietary) Limited
Ground Floor
70 Marshall Street
Johannesburg, 2001
(P O Box 61051, Marshalltown, 2107)
REGISTERED AUDITORS:
BDO South Africa Inc.
13 Wellington Road
Parktown, 2193
Date: 17/02/2011 13:47:38 Produced by the JSE SENS Department.
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