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TPC
TPC
TPC - Transpaco Limited - Unaudited interim group results for the 6 months ended
31 December 2010 and dividend announcement
Transpaco Limited
Reg. No. 1951/000799/06
ISIN: ZAE000007480
Share Code: TPC
UNAUDITED INTERIM GROUP RESULTS FOR THE 6 MONTHS ENDED 31 DECEMBER 2010 AND
DIVIDEND ANNOUNCEMENT
HEADLINE EARNINGS PER SHARE UP 14%
DIVIDENDS PER SHARE UP 16%
NET ASSET VALUE UP 20%
INTRODUCTION
Transpaco continued to deliver growth with pleasing results for the six months
ended 31 December 2010 ("the period"). Organic growth, the acquisition of Disaki
Cores and Tubes (Pty) Ltd ("Disaki") as well as a reduction in net interest paid
contributed to these results.
DISAKI ACQUISITION
Disaki, a former subsidiary of Nampak Products Limited is South Africa`s largest
producer of cardboard cores and tubes, angle board, carton dividers and void
fillers. Transpaco acquired Disaki with effect from 1 November 2010 expanding
Transpaco`s geographical and product offering within the Cores Division in line
with the group`s growth strategy. The business consists of three manufacturing
facilities situated in Gauteng, Western Cape and KwaZulu-Natal.
The cost of the acquisition was R42,6 million of which R26,0 million was paid
during the period. The final payment was made on 31 January 2011. All payments
have been financed out of existing cash resources.
FINANCIAL RESULTS
Earnings per share ("EPS") increased by 13,9% to 142,2 cents (December 2009:
124,9 cents). Headline earnings per share ("HEPS") increased by 13,9% to 141,9
cents (December 2009: 124,6 cents). The inclusion of turnover from the Disaki
acquisition for two months and acceptable volume growth from other divisions saw
turnover up 12,0% to R484,2 million (December 2009: R432, 4 million). This
resulted in operating profit improving by 10,7% to R59,4 million (December 2009:
R53, 6 million). The group`s operating costs were well within expectations and
increased in line with operational needs.
Strong cash flows led to a reduction of R1,2 million in net interest paid while
interest cover improved to 34,9 times (December 2009: 18,3 times). Stringent
asset control and the group`s profitability resulted in the net interest-bearing
debt:equity ratio decreasing to 3% (December 2009: 6%). Net cash decreased by
R15,2 million from R58,3 million to R43,1 million notwithstanding the payment
during the period of the first two tranches for the Disaki acquisition amounting
to R26,0 million.
The ranking and weighted number of shares in issue increased marginally due to
shares being taken up in terms of the Transpaco Share Option Scheme. This had a
minimal effect on diluted earnings per share.
Net asset value per share increased by 19,9% to 875 cents (December 2009: 730
cents).
PROSPECTS
The group will continue in its endeavours to achieve further growth and pursue
appropriate acquisitions.
POST-REPORTING PERIOD EVENT
Shareholders are referred to the SENS announcement dated 3 February 2011.
Amalgum Investments 36 (Pty) Ltd, Transpaco`s BBBEE shareholder, converted 3 312
126 convertible preference shares into ordinary shares on that date. These
ordinary shares did not rank for EPS and HEPS purposes but will be eligible to
receive the dividend declared below.
DIVIDEND
The board has declared an interim cash dividend of 29 cents per share (December
2009: 25 cents per share) representing a 16% increase on the comparative period.
The salient dates for the dividend are as follows:
Last date to trade shares cum dividend Thursday, 17 March 2011
Shares trade ex dividend Friday, 18 March 2011
Record date Friday, 25 March 2011
Payment date Monday, 28 March 2011
Share certificates may not be dematerialised or rematerialised between Friday,
18 March 2011 and Friday, 25 March 2011, both days inclusive.
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The unaudited interim financial results for the period are prepared in
accordance with IAS 34 - Interim Financial Reporting, and comply with the
Listings Requirements of the JSE Limited and the South African Companies Act,
1973. The accounting policies applied in these unaudited interim financial
statements are consistent in all material respects with those applied in the
preparation of the group`s annual financial statements for the previous year
ended 30 June 2010.
BOARD CHANGES
Kobus Botha, who devoted the past thirteen years to the development and success
of Transpaco, initially resigned as a main board director with the intention of
remaining on as a divisional managing director. Subsequently, Kobus has decided
to resign from Transpaco due to personal reasons. The board thanks Kobus for his
unrelenting contribution, dedication and loyalty to Transpaco and wishes him all
the success for the future.
In line with the recommendations of the King III Report Louis Weinberg has
relinquished the position of Company Secretary and has been replaced by Hendrik
van Niekerk with effect from 13 December 2010. Louis Weinberg remains on as the
group Financial Director.
ON BEHALF OF THE BOARD
AJ Aaron PN Abelheim L Weinberg
Non-executive Chairman Chief Executive Financial Director
DIRECTORS
AJ Aaron (Chairman)*; PN Abelheim (Chief Executive); L Weinberg (Financial
Director); HA Botha*; SR Bouzaglou; SI Jacobson*; D Thomas*; SP van der Linde*
*non-executive
Date 23 February 2011
Auditors Ernst & Young Incorporated
Company Secretary HJ van Niekerk
Sponsor Investec Bank Limited
Registered Office 331 6th Street, Wynberg, Sandton
Transfer Secretaries Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg
Website www.transpaco.co.za
SEGMENTAL ANALYSIS
R`000 Plastic Paper and Properties Total
Products Board and Group
Products Services
Turnover - 2010 346 737 137 468 - 484 205
Revenue to external 362 687 146 188 - 508 875
customers
Less revenue to 15 950 8 720 - 24 670
internal customers
Turnover - 2009 334 936 97 481 - 432 417
Revenue to external 352 703 104 992 - 457 695
customers
Less revenue to 17 767 7 511 - 25 278
internal customers
Operating profit - 42 079 16 755 526 59 360
2010
Operating profit - 41 161 12 195 244 53 600
2009
STATEMENT OF COMPREHENSIVE INCOME
R`000 Unaudited % Unaudited Audited
6 months change 6 months 12 months
Dec 2010 Dec 2009 June 2010
Turnover 484 205 12,0 432 417 786 340
Cost of sales 294 866 265 825 484 881
Profit before 189 339 13,7 166 592 301 459
operating costs and
depreciation
Operating costs 116 957 100 579 192 816
Depreciation 13 022 12 413 25 156
Operating profit 59 360 10,7 53 600 83 487
Net interest paid 1 700 2 923 5 214
Profit before 57 660 13,8 50 677 78 273
taxation
Taxation 17 569 15 551 23 843
Profit after taxation 40 091 14,1 35 126 54 430
Other comprehensive - - -
income
Total comprehensive 40 091 14,1 35 126 54 430
income
Weighted average 28 200 28 131 28 144
number of shares in
issue (`000)
Diluted weighted 32 070 31 768 31 882
average number of
shares in issue
(`000)
Earnings per share 142,2 13,9 124,9 194,4
(cents)
Headline earnings per 141,9 13,9 124,6 193,7
share (cents)
Diluted earnings per 125,3 12,9 111,0 171,6
share (cents)
Diluted headline 125,1 12,9 110,8 171,0
earnings per share
(cents)
Dividend per share 29,0 25,0 63,0
(cents)*
Reconciliation of
headline earnings
(R`000)
Basic earnings 40 091 35 126 54 430
Profit on disposal of (77) (71) (202)
property, plant and
equipment
Headline earnings 40 014 14,1 35 055 54 228
*Dividend declared after the period
CAPITAL COMMITMENTS
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2010 Dec 2009 June 2010
Capital expenditure
authorised and contracted
Property, plant and 4 746 9 994 4 469
equipment
STATEMENT OF FINANCIAL POSITION
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2010 Dec 2009 June 2010
ASSETS
Non-current assets 163 150 147 643 150 635
Property, plant and 151 829 142 298 146 830
equipment
Intangibles 482 482 482
Goodwill 3 204 3 204 3 204
Unlisted investments 33 1 376 33
Deferred taxation 7 602 283 86
Current assets 350 146 267 355 281 342
Inventories 93 682 59 398 82 848
Trade and other receivables 196 080 146 914 117 970
Taxation receivable 781 2 719 3 804
Cash at bank and in hand 59 603 58 324 76 720
TOTAL ASSETS 513 296 414 998 431 977
EQUITY AND LIABILITIES
Capital and reserves 256 598 214 639 226 993
Issued share capital 283 281 282
Other reserves 533 405 469
Preference shareholders` 9 273 9 273 9 273
interest
Distributable reserve 246 509 204 680 216 969
Non-current liabilities 46 476 61 818 55 358
Preference share liability 1 109 2 122 2 122
Interest-bearing borrowings 28 187 45 255 37 373
Deferred taxation 17 180 14 441 15 863
Current liabilities 210 222 138 541 149 626
Trade payables and accruals 158 464 103 302 114 588
Provisions 11 162 10 157 11 838
Current portion of interest-20 548 22 882 22 286
bearing borrowings
Taxation payable 3 556 2 200 914
Bank overdraft 16 492 - -
TOTAL EQUITY AND 513 296 414 998 431 977
LIABILITIES
Number of shares in issue
(`000)
(Net of treasury shares) 28 192 28 078 28 078
Net movement in treasury 73 67 114
shares
Ranking number of shares 28 265 28 145 28 192
Salient features
Net asset value per share 875 730 772
(cents)
Operating margin (%) 12,3 12,4 10,6
Net interest-bearing 3 6 Net cash
debt:equity ratio % positive
Interest cover (X) 34,9 18,3 16,0
STATEMENT OF CASH FLOW
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2010 Dec 2009 June 2010
Cash flow from operating
activities
Cash generated from 35 225 37 893 98 866
operations
Dividends paid (10 715) (8 864) (15 911)
Interest paid (2 772) (3 702) (7 428)
Interest income 1 072 779 2 214
Taxation paid (8 468) (10 006) (19 049)
Net cash inflow from 14 342 16 100 58 692
operating activities
Cash flow from investing
activities
Proceeds on disposal of 155 104 408
property, plant and
equipment
Expansion and replacement (10 296) (10 015) (27 413)
of property, plant and
equipment
Acquisition of new (26 038) - -
business
Decrease in unlisted - 2 747 4 090
investments
Net cash outflow from (36 179) (7 164) (22 915)
investing activities
Cash flow from financing
activities
Decrease in interest- (9 186) (10 783) (18 665)
bearing borrowings
Decrease in current (1 738) (4 414) (5 010)
portion of interest-
bearing borrowings
Decrease in preference (1 013) (927) (927)
share liability
Net movement in treasury 165 47 80
shares
Net cash outflow from (11 772) (16 077) (24 522)
financing activities
Net movement in cash for (33 609) (7 141) 11 255
the period
Cash and cash equivalents 76 720 65 465 65 465
at the beginning of the
period
Cash and cash equivalents 43 111 58 324 76 720
at the end of the period
STATEMENT OF CHANGES IN EQUITY
R`000 Issued Preference Other Distributable Total
Share Shareholder`s Reserves Reserves
Capital Interest
Balance at 30 281 9 273 341 178 371 188 266
June 2009
(audited)
Total - - - 54 430 54 430
comprehensive
income
Share-based - - 128 - 128
payments
Dividend paid - - - (15 911) (15 911)
Net movement 1 - - 79 80
in treasury
shares
Balance at 30 282 9 273 469 216 969 226 993
June 2010
(audited)
Total - - - 40 091 40 091
comprehensive
income
Share-based - - 64 - 64
payments
Dividend paid - - - (10 715) (10 715)
Net movement 1 - - 164 165
in treasury
shares
Balance at 31 283 9 273 533 246 509 256 598
December 2010
(unaudited)
Date: 23/02/2011 07:05:01 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,
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howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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