| Wed 2 Mar 2011, 10:00 | | SFN/SFNP - Sasfin Holdings Limited - Unaudited results and dividend declarations |
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SFN SFNP
SFN
SFN/SFNP - Sasfin Holdings Limited - Unaudited results and dividend declarations
for the six month period ended 31 December 2010
Sasfin Holdings Limited
Incorporated in the Republic of South Africa
(Company registration number: 1987/002097/06)
("Sasfin" or "the Group" or "the Company")
(Ordinary share code: SFN ISIN: ZAE000006565)
(Preference share code: SFNP ISIN: ZAE000060273)
Unaudited results and dividend declarations for the six month period ended 31
December 2010
31 December 31 December
2010 2009
Headline earnings 10% R53 million R48 million
Headline earnings per ordinary
share - 163 cents 164 cents
Total equity 8% R1,1 billion R1,0 billion
Total gross loans and advances
23% R2,4 billion R1,9 billion
Total assets 18% R4,1 billion R3,5 billion
Return on ordinary shareholders`
average equity 1 pps 13% 14%
Return on total average assets
- 3% 3%
Group capital adequacy 2 pps 28% 30%
Financial highlights
31 Dec 31 Dec 30 June
% 2010 2009 2010
Change Unaudited Unaudited Audited
Consolidated statement of
financial position
Total assets (Rm`s) 18 4 090 3 462 3 552
Total gross loans and advances
(Rm`s) 23 2 376 1 939 1 983
Non-performing loans and advances
(Rm`s) (5) 160 168 147
Income statement
Earnings attributable to ordinary
shareholders (Rm`s)
10 53 48 120
Headline earnings (Rm`s) 10 53 48 107
Financial performance
Return on ordinary shareholders`
average equity (%)
13 14 16
Return on total average assets
(%) 3 3 4
Operating performance
Non-interest income to total
income (%) (9) 71 78 71
Efficiency ratio (%) 3 72 70 70
Credit loss ratio (%) (24) 1,6 2,1 1,4
Non-performing loans and advances
to total gross loans and advances
(%) (22) 7 9 7
Share statistics
Earnings per ordinary share
(cents) (1) 163 164 396
Headline earnings per ordinary
share (cents) (1) 163 164 355
Diluted earnings per ordinary
share (cents) 163 163 396
Diluted headline earnings per
ordinary share (cents)
(1) 163 164 355
Number of ordinary shares in
issue at end of the period (`000)
4 32 236 31 109 32 186
Weighted average number of
ordinary shares in issue (`000)
11 32 212 29 048 30 203
Diluted weighted average ordinary
shares in issue (`000)
11 32 218 29 073 30 233
Dividends per ordinary share
relating to profit for the period
(cents) 7 49 46 133
Preference share dividend number
13 (cents) 362,05 - -
Preference share dividend number
12 (cents) - - 380,55
Preference share dividend number
11 (cents) - 401,51 401,51
Net asset value per ordinary
share (cents) 11 2 681 2 416 2 635
Capital adequacy
Group capital to risk weighted
assets (%) (2) pps 28 30 32
Sasfin Bank Limited capital to
risk weighted assets (%)
(7) pps 22 29 27
Employees
Permanent staff complement
2 572 563 563
Consolidated statement of financial position
31 Dec 31 Dec 30 June
2010 2009 2010
% Unaudited Unaudited Audited
Change R`000 R`000 R`000
Assets
Cash and cash balances 627 997 638 068 533 447
Short-term negotiable securities
89 108 80 822 58 000
Loans and advances to customers
23 2 275 163 1 853 439 1 902 500
Other receivables 338 064 266 872 292 989
Investment securities 386 261 277 141 396 017
Investment in associated
companies 69 819 55 604 65 334
Property, plant and equipment
181 062 189 345 184 406
Investment property 51 038 49 800 51 038
Taxation - 6 168 2 928
Intangible assets and goodwill
61 162 37 641 55 217
Deferred tax asset 10 552 7 192 9 646
Total assets 18 4 090 226 3 462 092 3 551 522
Liabilities
Interbank funding 151 268 82 973 52 094
Deposits from customers 35 1 293 507 955 043 911 559
Long-term loans 242 898 182 450 182 450
Other payables 298 281 245 163 338 187
Debt securities issued 945 281 925 004 924 436
Taxation 6 186 711 9 784
Deferred tax liability 73 819 67 606 69 112
Total liabilities 23 3 011 240 2 458 950 2 487 622
Equity
Ordinary share capital and share
premium 162 731 119 971 161 341
Reserves 701 563 631 732 686 848
Preference share capital and
share premium 199 278 199 278 199 278
Total equity attributable to
equity holders of the parent
12 1 063 572 950 981 1 047 467
Non-controlling interest 15 414 52 161 16 433
Total equity 8 1 078 986 1 003 142 1 063 900
Total liabilities and equity
18 4 090 226 3 462 092 3 551 522
Commitments and contingent
liabilities 57 704 47 625 61 283
Consolidated income statement
31 Dec 31 Dec 30 June
2010 2009 2010
% Unaudited Unaudited Audited
Change R`000 R`000 R`000
Interest income 199 156 196 231 352 052
Interest expense 108 308 114 002 172 448
Net interest income 11 90 848 82 229 179 604
Non-interest income 225 609 228 083 446 134
Total income 2 316 457 310 312 625 738
Impairment charges on loans and
advances (11) 17 680 19 746 27 552
Net income after impairments
298 777 290 566 598 186
Operating costs 5 231 017 219 726 436 393
Staff costs 119 611 109 771 185 883
Other operating expenses 111 406 109 955 250 510
Profit from operations 67 760 70 840 161 793
Share of associated companies`
income 5 596 2 888 8 093
Profit before income tax 73 356 73 728 169 886
Income tax expense 12 829 14 929 30 590
Profit for the period 3 60 527 58 799 139 296
Profit attributable to:
Non-controlling interest 795 1 971 2 775
Preference shareholders 7 249 9 298 16 947
Equity holders of the parent
10 52 483 47 530 119 574
Profit for the period 3 60 527 58 799 139 296
Earnings per ordinary share
(cents) 163 164 396
Diluted earnings per ordinary
share (cents) 163 163 396
Condensed consolidated statement of cash flows
31 Dec 2010 31 Dec 30 June
Unaudited 2009 2010
R`000 Unaudited Audited
R`000 R`000
Cash flows from operating activities
57 524 38 971 89 269
Movement in operating assets and
liabilities (95 132) 19 112 (14 299)
Net cash flows from operating
activities (37 608) 58 083 74 970
Net cash flows from investing
activities 10 622 (31 439) (160 444)
Net cash flows from financing
activities 37 680 204 221 217 613
Net increase in cash and cash
equivalents 10 694 230 865 132 139
Cash and cash equivalents at beginning
of the period 539 353 403 583 403 583
Effect of exchange rate fluctuations on
cash held 15 790 1 469 3 631
Cash and cash equivalents at end of the
period 565 837 635 917 539 353
Condensed consolidated statement of comprehensive income
31 Dec 31 Dec 30 June
2010 2009 2010
Unaudited Unaudited Audited
R`000 R`000 R`000
Profit for the period 60 527 58 799 139 296
Other comprehensive income for the period
net of income tax (9 508) (4 467) 625
Foreign currency translation reserve
(28 031) (5 159) (853)
Net gains on re-measurement of available-
for-sale financial assets
632 692 198
Gains on re-measurement of available-for-
sale financial assets
735 805 230
Income tax effect (103) (113) (32)
Net gains on hedge of net investment in
foreign operations 17 891 - 1 280
Gains on hedge of net investment in foreign
operations 24 849 - 1 778
Income tax effect (6 958) - (498)
Total comprehensive income for the period
51 019 54 332 139 921
Attributable to:
Non-controlling interest 795 504 2 775
Preference shareholders 7 249 9 298 16 947
Equity holders of the parent 42 975 44 530 120 199
Total comprehensive income for the period
51 019 54 332 139 921
Condensed consolidated statement of changes in equity
31 Dec 31 Dec 30 June
2010 2009 2010
Unaudited Unaudited Audited
R`000 R`000 R`000
Opening total shareholders` equity 1 063 900 930 734 930 734
Total comprehensive income for the period
51 019 54 332 139 921
Profit for the period 60 527 58 799 139 296
Foreign currency translation reserve
(28 031) (5 159) (853)
Available-for-sale reserve 632 692 198
Hedging reserve 17 891 - 1 280
Movement in non-controlling interest
(1 814) (7 399) (51 130)
Issue of ordinary shares 1 390 76 495 117 865
Share-based payments reserve movements
(220) - (411)
Preference share dividend (7 249) (9 298) (16 947)
Ordinary share dividend (28 040) (41 722) (56 132)
Closing balance 1 078 986 1 003 142 1 063 900
Condensed headline earnings reconciliation
31 Dec 31 Dec 30 June
2010 2009 2010
Unaudited Unaudited Audited
R`000 R`000 R`000
Earnings are determined as follows:
Earnings attributable to equity holders of
the parent 52 483 47 530 119 574
Headline adjustable items 50 32 (12 377)
Loss on sale of property and equipment
50 32 30
Gross 70 48 42
Tax Impact (20) (15) (12)
Non-controlling interest effect - (1) -
Revaluation of investment property
- - (12 407)
Gross - - (17 232)
Tax Impact - - 4 825
Headline earnings 52 533 47 562 107 197
Headline earnings per ordinary share (cents)
163 164 355
Condensed segmental analysis
31 Dec 31 Dec 30 June
2010 2009 2010
Unaudited Unaudited Audited
R`000 R`000 R`000
Segment Results
Business Banking 34 164 23 898 42 802
Capital 10 720 15 596 37 825
Treasury 2 568 2 166 15 480
Wealth Management 5 866 7 895 17 728
Logistics and Risk Management 2 784 2 813 6 205
Group 4 425 6 431 19 256
Profit for the period 60 527 58 799 139 296
Segment Revenue
Business Banking 215 604 207 278 402 688
Capital 49 536 39 972 97 255
Treasury 64 635 94 846 142 500
Wealth Management 89 510 89 993 173 855
Logistics and Risk Management 35 248 32 990 65 771
Inter-group eliminations (24 172) (37 877) (75 790)
Total segment revenue 430 361 427 202 806 279
Nature of business
Sasfin is a bank-controlling company listed in the "Financials: Investment
Services" sector of JSE Limited ("the JSE"). Sasfin and its subsidiaries provide
a wide range of complementary banking, financial and related services.
Business review: group performance
Business environment
* The South African economy continues to prove challenging, with signs of
recovery in certain sectors.
* Notwithstanding the improving business environment, the banking sector was
sluggish, with the demand for credit being mixed and subdued in most areas. In
addition, the regulatory landscape which is changing significantly, impacts
growth opportunities and increases costs of compliance.
* Sasfin continued to build on its core business activities, such that total
assets grew by 18% to R4,1 billion year on year, underpinned by solid growth in
the Business Banking division, with loans and advances reaching R2,4 billion, a
20% increase over the corresponding period in 2009. The yield thereon will flow
through in forthcoming financial periods.
Financial overview
* The Group`s operational performance was favourably impacted by the strong
lending base, representing the majority of Group earnings. The other core
businesses traded profitably, albeit at lower levels when compared to the
corresponding period in 2009.
* The Group`s headline earnings of R53 million (2009: R48 million) represents a
10% increase over 2009, whilst headline earnings per share remained flat year on
year, due to the dilutory effect of the capital injections.
* The results were positively affected by the Business Banking division, which
contributed approximately 56% to Group earnings, following the impressive asset
growth achieved, particularly in the rental finance book.
* Credit impairment losses continued a positive downward trend, indicative of an
improving credit environment. The annualised credit loss ratio decreased to 1,6%
on average loans and advances from 2,1% in 2009, with non-performing loans and
advances to total gross loans and advances down by 22% on 2009.
* As previously stated, the Group`s investment in its infrastructural
development, incorporating its people, technology and systems is largely in
place, resulting in the Group`s cost structure stabilising and reflecting an
inflationary increase of 5% year on year. However, the Group`s cost-to-income
ratio is still relatively high which is largely attributable to the lower
revenue levels and lack of scale in certain of the Group`s activities.
* In terms of Sasfin`s stated objective of growing the deposit book and
lengthening the maturity profile thereof, deposits increased encouragingly by
35% year on year. In addition, the Group is actively pursuing further
diversification of its funding sources, and was successful in securing new
funding lines during the period under review.
* Sasfin`s securitisation vehicle, a leader in its market, continues to perform
extremely well and successfully refinanced a tranche of R351 million of its
maturing notes subsequent to this reporting date.
* The Group maintains comfortable levels of capital and at 31 December 2010, the
statutory risk-weighted capital adequacy ratio of the Group was 28% (2009: 30%)
and that of Sasfin Bank Limited 22% (2009: 29%), which is well above the
prescribed regulatory requirement.
Prospects
* Sasfin is well positioned as a banking and financial services provider
focusing on the entrepreneurial market, and the Group expects to continue at
current levels of performance into the second half of the financial year.
* Sasfin is poised for future growth in its target markets, following the
significant strategic initiatives and investments made in prior years, and its
strong brand equity.
Basis of preparation and presentation of condensed interim financial statements
The condensed unaudited interim consolidated financial statements have been
prepared in accordance with IAS 34 - "Interim Financial Reporting" and the
requirements of the Companies Act of South Africa and in compliance with the JSE
Listings Requirements and the accounting policies applied conform to
International Financial Reporting Standards and the AC500 series. The same
accounting policies and methods of computation are followed in the interim
financial statements as compared to the 2010 annual financial statements. There
are no material events subsequent to the end of the interim period.
Preference share dividend
Notice is hereby given that preference dividend number 13 amounting to 362,05
cents (2009: 401,51 cents) per preference share ("preference dividend") has been
declared for the six months ended 31 December 2010 on one million preference
shares issued at R100,00 each and on nine hundred and five thousand preference
shares issued at R110,49 each. The preference dividend is payable to holders of
preference shares recorded in the register of the Company at the close of
business on Friday, 25 March 2011.
The salient dates relating to the preference dividend are as follows:
Last day to trade cum the preference Thursday, 17 March 2011
dividend
Preference shares commence trading ex Friday, 18 March 2011
the preference dividend
Preference dividend record date Friday, 25 March 2011
Payment date of preference dividend Monday, 28 March 2011
Preference shares may not be dematerialised or rematerialised between Friday, 18
March 2011 and Friday, 25 March 2011, both days inclusive.
Interim ordinary share dividend
The Group has a stated policy of declaring interim and final ordinary share
dividends equal in aggregate to 40% of headline earnings. In accordance with
this policy, the Board of Sasfin has resolved to pay an interim dividend as set
out below.
Notice is hereby given that an interim ordinary share dividend of 49 cents
(2009: 46 cents) per ordinary share ("interim ordinary dividend") has been
declared and is payable to ordinary shareholders recorded in the register of the
Company at the close of business on Friday, 1 April 2011.
The salient dates relating to the ordinary dividend are as follows:
Last day to trade cum the interim ordinary Friday, 25 March 2011
dividend
Ordinary shares commence trading ex Monday, 28 March 2011
interim ordinary dividend
Ordinary share dividend record date Friday, 1 April 2011
Payment date of interim ordinary dividend Monday, 4 April 2011
Ordinary share certificates may not be dematerialised or rematerialised between
Monday, 28 March 2011 and Friday, 1 April 2011, both days inclusive.
Directorate and changes to the board
As previously announced, following the retirement of Mr Martin Glatt, Mr Norman
Axten was appointed as non-executive chairman of the Company and its subsidiary,
Sasfin Bank Limited with effect from 26 November 2010.
Mr Tyrone Soondarjee was appointed an executive director of the Company and its
subsidiary, Sasfin Bank Limited, on 4 October 2010, and assumed the position of
financial director of the Group.
Mr John Moses and Mr Roy Andersen were appointed as non-executive directors of
the Company and its subsidiary, Sasfin Bank Limited, on 21 December 2010 and 14
February 2011 respectively.
As previously announced, Mr Marius Smith will be retiring as non-executive
director of the Company, including its subsidiary, Sasfin Bank Limited, with
effect from 31 March 2011.
Ms Hannetjie Boshoff was appointed as Group Company Secretary with effect from 3
January 2011.
For and on behalf of the Board
CN Axten RDEB Sassoon
Chairman Chief Executive Officer
2 March 2011
This announcement and additional information is available on the website:
www.sasfin.com
Registered Office
29 Scott Street, Waverley, 2090, Johannesburg,
Tel: +27 11 809 7500, Fax: +27 11 887 6167/2489
Websites: www.sasfin.com
www.sfpsecurities.com
Independent Non-Executive Chairman
CN Axten
Executive Directors
RDEB Sassoon * (Chief Executive Officer), TD Soondarjee (Financial Director), M
Segal* British
Non-Executive Directors
RC Andersen#, ETB Blight#, GC Dunnington#, DD Mokgatle#,
J Moses#, MS Rylands, ML Smith#
# Independent
Company Secretary
H Boshoff
Transfer Secretaries
Computershare Investor Services (Pty) Limited
70 Marshall Street, Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Lead Sponsor
KPMG Services (Pty) Limited
Joint Sponsor
Sasfin Capital (a division of Sasfin Bank Limited)
Corporate Law Advisors
Edward Nathan Sonnenbergs Inc.
Date: 02/03/2011 10:00:01 Produced by the JSE SENS Department.
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