| Mon 5 Sep 2011, 16:47 | | 1TM - 1time Holdings Limited - Reviewed results for the interim period ended 30 |
|
1TM
1TM
1TM - 1time Holdings Limited - Reviewed results for the interim period ended 30
June 2011
1time Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 1999/017536/06)
Share Code: 1TM * ISIN Code: ZAE000102026
("1time") or ("the Group")
Reviewed results for the interim period ended 30 June 2011
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION
Reviewed Reviewed Audited
as at as at as at
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
Assets
Non-current assets 406 161 123 468 861 375 473 235 139
Current assets 164 094 069 181 303 222 169 167 094
Non-current assets held for
sale - 21 565 250 6 653 100
Total assets 570 255 192 671 729 847 649 055 333
Equity and liabilities
Capital and reserves 163 926 903 176 949 244 150 787 188
Non-current liabilities 71 626 171 120 392 769 64 758 407
Deferred taxation 16 566 689 37 857 262 49 224 679
Current liabilities 318 135 429 336 530 572 384 285 059
Total equity and liabilities 570 255 192 671 729 847 649 055 333
Net asset value per share
(cents) 58,5 84,3 71,8
Net tangible asset value
per share (cents) 56,5 76,0 69,7
CONSOLIDATED CONDENSED INCOME STATEMENT
Reviewed Reviewed
six months six months Audited
ended ended year ended
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
Gross revenue 654 009 387 648 457 498 1 308 244 783
Operating costs (648 505 074) (590 449 465) (1 194 177 220)
Earnings before interest,
tax and depreciation
5 504 313 58 008 033 114 067 563
Depreciation (24 173 407) (27 207 972) (54 917 991)
Impairment (2 064 392) (3 173 106) (49 558 877)
(Loss)/profit on sale of
asset (14 735 077) 1 866 940 1 049 893
Foreign exchange difference
(83 732) (852 120) 11 068 500
Operating (loss)/profit
(35 552 294) 28 641 775 21 709 088
Finance costs (15 596 672) (17 636 413) (36 065 558)
Investment income 1 904 098 2 625 951 3 509 229
(Loss)/profit before
taxation (49 244 868) 13 631 313 (10 847 241)
Taxation 15 316 293 (3 397 593) (253 189)
(Loss)/profit after taxation
(33 928 575) 10 233 720 (11 100 430)
Non-controlling interest
1 282 2 989 634 12 264 651
(Loss)/profit attributable
to owners of the parent
(33 927 293) 13 223 354 1 164 221
Reconciliation toheadline
earnings
(Loss)/profit attributable
to ordinary shareholders
(33 927 293) 13 223 354 1 164 221
Impairment of assets 2 064 392 3 173 106 46 079 941
Profit/(loss) on sale of
asset 10 609 255 (1 605 568) (902 908)
Headline (loss)/earnings
attributable to ordinary
shareholders
(21 253 645) 14 790 892 46 341 254
Weighted average number of
shares 256 666 667 210 000 000 210 000 000
Headline (loss)/earnings per
share (cents)
(8,3) 7,0 22,1
(Loss)/earnings per share
(cents) (13,2) 6,3 0,6
Earnings/(loss) per share
(Loss)/profit attributable
to ordinary shareholders
(33 927 293) 13 223 354 1 164 221
(Loss)/earnings attributable
to ordinary shareholders
(33 927 293) 13 223 354 1 164 221
CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
Reviewed Reviewed
six months six months Audited
ended ended year ended
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
(Loss)/profit after tax (33 928 575) 10 233 720 (11 100 430)
Other comprehensive income:
Net (loss)/gain in aircraft
revaluations - 793 193 (4 034 711)
Total comprehensive
(loss)/income (33 928 575) 11 026 913 (15 135 141)
Total comprehensive
(loss)/profit attributable
to:
Non-controlling interest (1 282) (2 989 634) (12 264 651)
Owners of the parent (33 927 293) 14 016 547 (2 870 490)
(33 928 575) 11 026 913 (15 135 141)
CONSOLIDATED CONDENSED STATEMENT OF CHANGES IN EQUITY
Reviewed Reviewed
six months six months Audited
ended ended year ended
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
Opening balance 150 787 190 165 922 331 165 922 331
Non-controlling interest
at acquisition - - -
Shares issued 47 068 288 - -
Shares capital issued 7 000 - -
Share premium 47 061 288 - -
Total comprehensive
(loss)/income (33 928 575) 11 026 913 (15 135 142)
- Non-controlling
interest (1 282) (2 989 634) (12 264 651)
- Owners of the parent (33 927 293) 14 016 547 (2 870 491)
Purchase of non-
controlling interest - - -
Shares purchased 280 - -
Minority interest 4 033 812 - -
Acquisition of 28%
shareholding (4 034 092) - -
Total 163 926 903 176 949 244 150 787 188
CONSOLIDATED SEGMENT REPORT
Reviewed Reviewed
six months six months Audited
ended ended year ended
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
Gross revenue
Airline 565 430 823 565 169 536 1 147 538 372
Charter - 5 747 917 8 920 263
Saftech 139 159 741 138 931 609 264 861 076
Aeronexus - 900 000 900 000
Inter-segment revenue (50 581 177) (62 291 564) (113 974 928)
Total 654 009 387 648 457 498 1 308 244 783
Earnings before
disclosable items
Airline (6 990 560) 62 210 600 140 214 113
Charter 1 016 922 (497 789) 1 979 352
Saftech 16 992 670 (3 193 953) (26 420 441)
Aeronexus - (158 114) 95 192
Holdings (3 008 329) - -
Eliminations (2 506 391) (352 711) (1 800 653)
Earnings before
disclosable items 5 504 313 58 008 033 114 067 563
Disclosable items
Interest expense (15 596 672) (17 636 413) (36 065 558)
Interest received 1 904 098 2 625 951 3 509 229
Impairment (2 064 392) (3 173 106) (49 558 877)
Foreign exchange
differences (83 732) (852 120) 11 068 500
(Loss)/profit on sale of
assets (14 735 077) 1 866 940 1 049 893
Depreciation (24 173 407) (27 207 972) (54 917 991)
Taxation 15 316 293 (3 397 593) (253 189)
(Loss)/profit after tax (33 928 575) 10 233 720 (11 100 430)
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
Reviewed Reviewed
six months six months Audited year
ended ended ended
30 June 30 June 31 December
Figures in Rand 2011 2010 2010
Cash and cash
equivalents at beginning
of the period 24 084 787 50 328 677 50 328 677
Cash flows from
operating activities (11 557 982) 30 348 370 130 530 506
Cash generated from
operations 4 234 592 46 298 530 144 461 364
Interest received 1 904 098 2 625 951 3 509 229
Interest paid (15 596 672) (17 636 413) (14 180 773)
Tax paid (2 100 000) (939 698) (3 259 314)
Cash flows from
investing activities (11 011 193) (39 058 001) (92 772 160)
Cash flows from
financing activities (8 977 451) (12 707 586) (64 002 236)
Cash and cash
equivalents at end of
the period (7 461 839) 28 911 460 24 084 787
COMMENTARY
Performance review
The Group achieved disappointing interim results for the six months to 30 June
2011 with an attributable headline loss of R21,3 million compared to the R14,8
million attributable headline earnings for the same period last year. Group
revenue was flat at R654 million for the period.
The losses are largely attributed to 1time airline (Proprietary) Limited ("the
airline") which incurred increases in fuel prices, increased airport charges and
poor passenger demand during May and June. The aircraft maintenance business
turnaround is on track achieving close to breakeven for the period.
Total balance sheet debt has been reduced and net working capital improved by
R61 million since the beginning of the year following the Safair Technical
(Proprietary) Limited ("Safair Technical") debt restructuring transaction in
February and the BEE funding transaction completed in March. Cash generated from
operations reduced to R4 million compared to the R46,3 million generated for the
same period last year.
1time airline
The airline`s financial performance was poor for the six months to June
incurring a R34,7 million attributable loss compared to the R20,1 million profit
earned in the same period last year. Passenger revenue was flat at R565 million.
The losses were largely attributed to:
* a 6% passenger decline caused by abnormally poor demand in May and June
only partly offset by a 5% yield growth;
* airport charges increased by 24% for the period resulting in a R12 million
increase in airport costs; and
* average Rand fuel prices increased by 28% for the period increasing fuel
costs by R56,5 million for the period.
The 70% increase in Airports Company South Africa ("ACSA") passenger taxes from
1 October 2011 is a major concern and is expected to materially impact passenger
volumes in the second half. Exorbitant airport taxes will continue to constrain
tourism and business growth particularly in SADC countries.
The airline has performed well operationally and we are pleased that ACSA has
agreed to publish all airlines` monthly on-time performance based on actual
performance. For July 2011 the airline achieved 90% on-time performance, the
best of the low cost airlines. The first African MD80 flight simulator based at
OR Tambo has been certified and is operational. This will result in training
cost savings for the airline.
The airline has plans to expand capacity including the introduction of Lanseria
air services in the last quarter of 2011 to provide our customers with a greater
choice of destinations and affordable airfares.
The Maputo route was discontinued effective 31 August 2011 due to high airport
taxes and inadequate frequencies to satisfy the needs of the business market.
The airline is exploring opportunities in various other African destinations.
Aircraft fleet
The airline aircraft fleet renewal plan is currently in progress and the Group
expects to announce aircraft fleet changes during 2012 to ensure that the
airline maintains its position as the lowest cost operator in the domestic
industry.
Safair technical
The turnaround strategy at Safair Technical is achieving success. Attributable
losses have been reduced from R22,6 million in the preceding year to R1,4
million for the six months to June 2011.
Total revenue increased marginally to R139 million on higher third party demand.
Significant fixed cost savings have been achieved without impacting revenue
capacity.
Further revenue growth and cost savings are expected in the second half of 2011.
Safair technical restructuring
The Safair Technical restructuring has been successfully implemented in
accordance with the terms of the Letter of Intent as advised to shareholders in
the Subsequent Events note in the 2010 annual report.
In terms of the restructuring agreement Safair Operations (Proprietary) Limited
has assumed responsibility for approximately R50 million of Safair Technical
debt in exchange for a cession of leasehold improvements and the sale of
Lockheed equipment assets of an equivalent value. The transaction reduces Group
debt and is earnings enhancing on lower rental and interest costs. In terms of
the agreement 1time Holdings Limited acquired 28% of Safair Technical from
Safair Operations for R280 on 28 February 2011 to achieve a 100% shareholding.
RineshRamkissoon, previously CEO of South African Airways Technical
(Proprietary) Limited and General Manager of Qatar Airways was appointed as CEO
during May 2011.
Dividend policy
The Board has adopted a dividend policy of a minimum of eight times cover moving
into the 2011 financial year. This resulted from the successful BEE transaction,
however due to the losses reported for the period, no dividend has been
declared.
Basis of preparation and accounting policies
The accounting policies applied in the preparation of these condensed financial
statements, which are based on reasonable judgements and estimates, are in
accordance with International Financial Reporting Standards ("IFRS") and are
consistent with those applied in the annual financial statements for the year
ended 31 December 2010. These reviewed consolidated condensed interim financial
statements as set out in this report have been prepared in terms of IAS 34 -
Interim Financial Reporting, the Companies Act, 2008 (Act No 71 of 2008), as
amended, and the Listings Requirements of JSE Limited.
Review opinion
The consolidated condensed interim results for the period ended June 2011 have
been reviewed by the auditors of 1time, SAB&T Chartered Accountants. Their
unqualified review opinion is available for inspection at the offices of 1time
Holdings Limited.
Subsequent events
The Board is not aware of any material matter or circumstance arising since the
end of the interim financial period ended June 2011 up to the date of this
report.
Prospects
Prospects for the airline in the second half of the year are expected to improve
through higher revenues driven by higher demand in the seasonally stronger
second half and the introduction of expanded air services. Yield and demand will
be negatively impacted by the increase in airport taxes.
Margins and costs will however be driven by the oil price.
The turnaround strategy in Safair Technical is expected to achieve profitability
in the second half through higher revenue and lower costs with strong demand
from third party maintenance customers.
By order of the Board
Glenn Orsmond SiphoTwala
Group Chief Executive Officer Chairman
5 September 2011
Corporate information
Non-executive directors: S M Twala (Chairman)*; T R Matsinhe*; G L Wishart; M L
Sinclair (Alternative) *Independent non-executive director
Executive directors: G W Orsmond (Chief Executive Officer); R L James; M J
Kaminski
Company secretary: Merchantec Capital
Transfer secretaries: Computershare Investor Services (Proprietary) Limited
Sponsor: Merchantec Capital
Auditors: SAB&T Chartered Accountants
Registered address: Unit D2, Isando Industrial Park, Hulley Road, Isando
Postal address: PO Box 7110, Bonaero Park, 1622
Telephone: 011 086 8100
Facsimile: 0866 492 712
www.1timeholdings.co.za
Date: 05/09/2011 16:47:33 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.
