| Thu 29 Sep 2011, 16:52 | | SEP - Sephaku Holdings Limited - Condensed consolidated provisional financial |
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SEP
SEP
SEP - Sephaku Holdings Limited - Condensed consolidated provisional financial
results for the twelve months ended 30 June 2011
SEPHAKU HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2005/003306/06)
Share code: SEP ISIN: ZAE000138459
("Sephaku Holdings" or "the Company" or "the Group")
CONDENSED CONSOLIDATED PROVISIONAL FINANCIAL RESULTS
for the twelve months ended 30 June 2011
CONDENSED CONSOLIDATED STATEMENT
OF FINANCIAL POSITION
30 June 30 June
2011 2010
R`000 R`000
Audited Audited
Assets
Non-current assets 691 771 507 314
Current assets 38 773 105 276
Non-current assets held for sale 21 164 -
Total assets 751 708 612 590
Equity and liabilities
Equity attributable to equity holders of the parent 746 784 406 415
Non-controlling interest - 71 674
Non-current liabilities - 32 249
Current liabilities 4 924 102 252
Total equity and liabilities 751 708 612 590
Net asset value per share (cents) 441,13 260,85
Tangible net asset value per share (cents) 406,16 203,25
Ordinary shares in issue 169 290 732 155 805 362
CONDENSED CONSOLIDATED STATEMENT
OF CASH FLOWS
Twelve months Sixteen months
ended ended
30 June 30 June
2011 2010
R`000 R`000
Audited Audited
Cash flows from operating activities (51 780) (112 866)
Cash flows from investing activities (3 927) (172 283)
Cash flows from financing activities 46 644 28 370
Total cash movement for the period (9 063) (256 779)
Cash at beginning of the period 14 898 271 678
Cash at end of the period 5 835 14 899
CONDENSED CONSOLIDATED STATEMENT
OF COMPREHENSIVE INCOME
Twelve months Sixteen months
ended ended
30 June 30 June
2011 2010
R`000 R`000
Audited Audited
Operating loss (37 277) (27 255)
Profit on dilution/disposal of interest in
companies 409 998 31 124
Investment revenue 1 163 4 258
Loss from equity accounted investments (8 859) (2 048)
Finance costs (926) (122)
Profit before taxation 364 099 5 957
Taxation (1 558) 1 059
Profit from continuing operations 362 541 7 016
Loss for the period from discontinued
operations (18 842) (97 190)
Profit/(loss) for the period 343 699 (90 174)
Other comprehensive (loss)/income for the period (46 921) 34 239
Total comprehensive income/(loss) for the period 296 778 (55 935)
Profit/(loss) attributable to:
Equity holders of the parent 343 699 (71 497)
Non-controlling interest - (18 677)
Total comprehensive income/(loss) attributable to:
Equity holders of the parent 303 550 (44 030)
Non-controlling interest (6 772) (11 905)
Ordinary shares:
- weighted average number of shares 161 305 112 154 896 985
- diluted weighted average number of shares 176 788 582 160 836 985
Attributable profit/(loss) per share:
- basic earnings from continuing operations (cents) 224,75 4,53
- basic earnings/(loss) from total operations
(cents) 213,07 (46,16)
- diluted earnings from continuing operations
(cents) 205,07 4,36
- diluted earnings/(loss) from total
operations (cents) 194,41 (44,45)
- headline loss (cents) (39,63) (63,23)
- diluted headline loss (cents) (36,16) (60,89)
Reconciliation of basic loss to diluted
loss and headline loss:
Basic earnings/(loss) and diluted
earnings/(loss) from total
operations attributable to equity holders of
the parent 343 699 (71 497)
Profit on sale of non-current assets (409 997) (31 124)
Impairments 2 366 4 684
Headline loss attributable to equity holders
of the parent (63 932) (97 937)
Reconciliation of weighted average number of
shares:
Basic weighted average number of shares 161 305 112 154 896 985
Diluted effect of share options 15 483 470 5 940 000
Diluted weighted average number of shares 176 788 582 160 836 985
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Total
share Total Retained
capital reserves earnings
R`000 R`000 R`000
Balance at 1 March 2009 214 982 1 678 212 702
Total comprehensive income/(loss) for
the period - 27 466 (71 496)
Issue of shares 7 816 - -
Subsidiary holding treasury shares sold 2 417 - -
Cross Company Management (Pty) Limited
transferred to Trust - - 8 003
Employees share option scheme - 2 847 -
Balance at 1 July 2010
Audited 225 215 31 991 149 209
Total comprehensive income/(loss) for the
period - (40 149) 343 699
Issue of shares 47 054 - -
Dilution of control in Sephaku Cement
(Pty) Limited 319 859 - (319 859)
Employees share option scheme - 1 548 1 782
Dividend paid - - (13 565)
Balance at 30 June 2011
Audited 592 128 (6 610) 161 266
Dividend paid per share (cents) 8,71
Attributable
to equity Non-
holders of controlling Total
the parent interests equity
R`000 R`000 R`000
Balance at 1 March 2009 429 362 83 579 512 941
Total comprehensive income/(loss)
for the period (44 030) (11 905) (55 935)
Issue of shares 7 816 - 7 816
Subsidiary holding treasury shares sold 2 417 - 2 417
Cross Company Management (Pty)
Limited transferred to Trust 8 003 - 8 003
Employees share option scheme 2 847 - 2 847
Balance at 1 July 2010
Audited 406 415 71 674 478 089
Total comprehensive income/(loss)
for the period 303 550 (6 772) 296 778
Issue of shares 47 054 - 47 054
Dilution of control in Sephaku
Cement (Pty) Limited (64 902) (64 902)
Employees share option scheme 3 330 - 3 330
Dividend paid (13 565) - (13 565)
Balance at 30 June 2011
Audited 746 784 - 746 784
Dividend paid per share (cents)
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL RESULTS
Segmental reporting
Cement Fluorspar Other
R`000 R`000 R`000
Segment information for the
Group - 30 June 2010
Audited
Segment (profit)/loss 86 215 2 712 (12 590)
Segment assets 470 558 53 252 149 631
Segment liability (127 410) (59 033) (22 427)
Consolidation Total
R`000 R`000
Segment information for the
Group - 30 June 2010
Audited
Segment (profit)/loss 13 837 90 174
Segment assets (60 851) 612 590
Segment liability 74 369 (134 501)
Segment information for the Group - 30 June 2011 - Audited
Due to the dilution of Sephaku Holdings` interest in Sephaku Cement (Pty)
Limited and the unbundling of Incubex Minerals Limited ("Incubex") subsidiaries`
assets and liabilities, the only reportable segment in 2011 is Fluorspar. No
segment reporting has therefore been presented in the current reporting period.
Basis of preparation
The condensed consolidated provisional results for the twelve months ended 30
June 2011 ("annual reporting period") have been prepared in in accordance with
IAS 34: Interim Financial Reporting, as well as the AC 500 statements and
interpretations, on a historical cost basis and conform to International
Financial Reporting Standards ("IFRS").
The accounting policies adopted for the annual reporting period are consistent
with those applied in the financial statements for the Group for the period
ended 30 June 2010.
The annual reporting period announcement has been prepared in accordance with
the disclosure requirements of the JSE Limited Listings Requirements and the
Companies Act of South Africa.
The preparation of the financial statements have been supervised by NR Crafford-
Lazarus (CA (SA)) and Steven Steyn (CA(SA)).
Audit opinion
The financial results have been audited by the Group`s external auditors PKF
(Pta) Inc. A copy of their unqualified audit report is available for inspection
at the Company`s registered office.
Statement on going concern
The financial statements for the annual reporting period have been prepared on
the going-concern basis as the directors have every reason to believe that the
Company has adequate resources in place to continue in operation for the
foreseeable future.
Significant events and transactions
Restructuring
The Group was restructured during the annual reporting period in order to
represent a more defined and focused investment opportunity to the market.
Sephaku Holdings has disposed of all of the shares that it held in its
subsidiaries to Incubex, save for its cement and fluorspar interests.
Subsequently, Sephaku Holdings distributed all of the issued shares in Incubex
to its shareholders in the form of a dividend in specie of R13,6 million in the
ratio of one Incubex share for every ten Sephaku Holdings shares held.
The impact of the restructuring on the annual reporting period results is the
removal of the Incubex subsidiaries` assets and liabilities from Sephaku
Holdings consolidation. The total loss for the Incubex subsidiaries for the
annual period up to the unbundling on 31 October 2010, is included in the
Statement of Comprehensive Income as a R2 million loss from discontinued
operations.
Dilution of interest in Sephaku Cement
Sephaku Cement (Pty) Limited ("Sephaku Cement") issued shares for cash to
Dangote Industries Limited ("Dangote Industries") during the annual reporting
period in order to settle a loan of R75,6 million.
Dangote Industries also subscribed for shares in an amount of R703,4 million
resulting in Dangote Industries increasing its interest in Sephaku Cement from
19,76% to 64,00% with Sephaku Holdings retaining a 35,994% interest. The
finalisation of the Dangote Industries` transaction places Sephaku Cement firmly
on track to develop its Aganang and Delmas projects with sufficient equity
funding and the necessary guarantees provided by Dangote Industries to secure
the required debt financing.
Sephaku Cement`s assets and liabilities are no longer consolidated in Sephaku
Holdings but are shown as an equity accounted investment in associate at a fair
value of R635 million on the date of dilution. Profit on dilution of interest in
Sephaku Cement of R408 million is included in the Statement of Comprehensive
Income as well as a loss of R16,7 million for the annual period to 15 October
2010, which is classified as loss from discontinued operations, as a result of
the change in Sephaku Holdings` interest in Sephaku Cement from a subsidiary to
an associate.
African Nickel Holdings
Sephaku Holdings` investment in African Nickel Holdings (Pty) Limited is carried
at fair value less cost to sell of R21 million and is disclosed as an asset held
for sale, as management is committed to a plan to dispose of the nickel assets
in the near future.
Fluorspar
Mining Right GP/30/5/1/2/2 (293) MR was notarially executed by the Department of
Mineral Resources on 26 July 2011 and is valid until 25 July 2031. Sephaku
Fluoride Limited`s ("Sephaku Fluoride") two major deposits, the Outwash Fan
deposit and the Plattekop deposit, are together believed to rank among the
highest-grade fluorspar deposits in the world. Sephaku Fluoride intends
developing these into a fluorspar mine, aiming to initially produce 180 000tpa
of chemical-grade fluorspar by the end of 2013.
Mineral resource and mineral reserve statements
There have been no material changes to the Company`s mineral resource and
mineral reserve statements as compared to those presented in the financial
results for the sixteen months ended 30 June 2010.
Events subsequent to 30 June 2011
On 12 October 2010 Ulipac (Pty) Limited ("Ulipac") (a wholly-owned subsidiary of
Sephaku Fluoride) and Umbono Fluorspar Wallmannsthal (Pty) Limited ("Umbono")
entered into an agreement whereby Ulipac acquired the Prospecting Right for the
Fluorspar deposit on the Wallmannsthal Agricultural Holdings and the associated
property from Umbono.
This agreement was subject to the consent of the Minister of Mineral Resources
in terms of section 11 of the Mineral and Petroleum Resources Development Act,
which was obtained and executed on 8 August 2011.
The purchase price of R15 million for the prospecting right and property will be
settled by Ulipac as follows:
-R6 million cash payable in monthly instalments of R1 million from 1 September
2011 to 1 February 2012. The balance of the cash portion shall accrue interest
at the prime lending rate, which will be repaid with the final instalment; and
- the issue of 2,5 million listed shares in Sephaku Holdings at R3,60 per share.
One-third of the shares are subject to an 18-month restriction period and two-
thirds of the shares are subject to a 24-month restriction period, in that
Umbono will not be able to sell the restricted shares during the restriction
period.
Subsequent to year-end Sephaku Fluoride received a loan of US$10 000 000 which
may be converted into an equity participation of 10% to 15%, subject to certain
investment criteria. The conversion will take place at the earliest of a
restructuring transaction by Sephaku Holdings and 31 January 2012. In the event
that a restructuring transaction has not taken place by 31 January 2012, the
loan will either be settled in cash together with accrued interest or shares.
Changes to the board
Mr Morrison Smit resigned as the financial director of the Company with effect
from 28 February 2011 and Mr Steven Steyn was appointed as acting chief
financial officer. There have been no further changes to the board of directors.
On behalf of the board
Neil Crafford-Lazarus Lelau Mohuba Pretoria
CEO Chairman 29 September 2011
Company information
Directors
L Mohuba (Chairman), NR Crafford-Lazarus* (Chief Executive Officer)
RR Matjiu*, CR de Bruin, MG Mahlare, GS Mahlati
MM Ngoasheng, PF Fourie, J Bennette#, D Twist#, JW Wessels#
*Executive #Alternate
Company secretary
Cross Company Management (Pty) Limited
Registered office
Suite 4A, Manhattan Office Park
16 Pieter Road, Highveld Technopark
Centurion, 0169
Transfer Secretaries
Computershare Investor Services (Proprietary) Limited
70 Marshall Street
Johannesburg
Sponsor
Questco Sponsors (Proprietary) Limited
www.sephakuholdings.co.za
Date: 29/09/2011 16:52:01 Produced by the JSE SENS Department.
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