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BCF
BCF
BCF - Bowler Metcalf Limited - Provisional reviewed condensed consolidated
results for the year ended 30 June 2011
Bowler Metcalf Limited
(Registration number 1972/005921/06)
Share code: BCF ISIN: ZAE000030797
("Bowler" or "the company")
PROVISIONAL REVIEWED CONDENSED CONSOLIDATED RESULTS FOR THE YEAR ENDED 30
JUNE 2011
HEADLINE EARNINGS +16% DIVIDENDS PROPOSED +27%
R mil 30/06/11 % Change 30/06/10
STATEMENT OF FINANCIAL POSITION
Non-current assets 158.0 173.6
Property, plant and equipment 137.6 153.1
Deferred tax 3.2 3.3
Intangible assets 15.9 15.9
Investments 1.3 1.3
Current Assets 331.6 251.8
Inventories 67.3 57.2
Trade and other receivables 99.7 87.8
Prepayments 31.9 23.8
Cash and cash equivalents 128.9 81.6
Taxation 3.8 1.4
Total Assets 489.6 +15 425.4
Total Equity 407.6 +17 348.0
Non-current liabilities 19.6 22.0
Deferred tax 15.3 17.7
Borrowings - interest bearing 4.3 4.3
Current Liabilities 62.4 55.4
Trade and other payables 44.4 52.9
Bank overdrafts 12.8 -
Borrowings - interest bearing 3.7 2.4
Taxation 1.5 0.1
Total Equity and Liabilities 489.6 425.4
STATEMENT OF COMPREHENSIVE INCOME
Revenue 591.1 +14 518.2
Other income 5.7 3.1
Operating costs -452.2 -390.5
Depreciation -31.2 -32.2
Impairments - -1.0
Profit from operations 113.4 97.6
Net interest 1.1 0.7
Net profit before tax 113.4 98.3
Income tax expense -31.4 -28.9
Total comprehensive income 83.1 69.4
Attributable to minorities -5.6 -2.7
Attributable to parent 77.5 +16 66.7
Earnings & diluted earnings per share (c)
96.28 +16 83.01
Headline earnings (c) 77.3 +14 67.7
Earnings per share 96.28 83.01
Disposal of assets -0.27 -0.04
Impairments - 1.25
Basic and diluted earnings per share (c)
96.01 +14 84.22
ADDITIONAL INFORMATION
Div/share paid (c) 30.60 +10 27.90
Ord div proposed (c) 35.60 +27 28.00
Dividend cover (times) 2.70 3.01
Weighted shares in issue (mil) 80.476 80.353
Capital expenditure 15.90 21.20
Capital commitments 14.70 -
CHANGES IN EQUITY Share Retained Treasury Share Non- Total
capital earnings shares based Con- Equity
payments trol-
ling
inte-
rests
30 June 09 21.5 308.5 -34.5 0.5 6.3 302.3
Comprehensive
Income - 66.7 - 0.7 2.7 70.1
Dividends - -22.6 - - -0.3 -22.9
Other -1.5 -1.5
30 June 10 21.5 352.6 -36.0 1.2 8.7 348.0
Comprehensive Income
- 77.5 - - 5.6 83.1
Dividends - -24.6 - - -1.3 -25.9
Other 0.3 1.9 0.2 2.4
30 June 11 21.5 405.8 -34.1 1.4 13.0 407.6
SEGMENTAL ANALYSIS Plastic Filling Property Unallo- Total
cated
Revenue
2010 242.2 262.5 13.5 - 518.2
Total revenue 306.7 262.5 13.5 - 582.7
Intersegment -64.5 - - - -64.5
2011 244.0 330.9 16.2 - 591.1
Total revenue 335.4 330.9 16.2 - 591.1
Intersegment -91.4 - - - -91.4
Attributable
Profits
2010 53.2 7.1 6.4 - 66.7
2011 53.1 15.3 9.1 - 77.5
Tot assets
2010 251.5 110.9 47.1 15.9 425.4
Total assets 310.7 114.2 85.4 15.9 526.4
Intersegment -59.2 -3.3 -38.3 - -100.8
2011 305.0 124.7 44.0 15.9 489.6
Total assets 310.7 114.2 85.4 15.9 526.2
Intersegment -42.3 -1.8 -44.8 - -88.9
STATEMENT OF CASH FLOWS
R mil 30/06/11 % Change 30/06/10
Operating activities 46.8 84.7
Profit before tax 114.5 98.3
Non-cash items 31.4 33.9
Working capital changes -38.6 4.4
Taxation paid -34.6 -28.9
Dividends paid -25.9 -23.0
Investing activities
Property, plant and equipment -15.4 -21.1
Financing activities 3.1 -5.4
Borrowings 1.3 -4.0
Share transactions 1.8 -1.4
Net cash flow 34.5 58.2
Opening balance 81.6 23.4
Closing balance 116.1 +42 81.6
Comprising
Cash & cash equivalents 128.9 +58 81.6
Bank overdrafts -12.8 -
COMMENT
The Group maintained their 24 year increase in earnings (16%) and dividends
(27%) over a challenging 12 months. The net cash inflow was R34.5m leaving
cash reserves of R116m at year end. Market conditions were characterized by
hesitancy, possibly spurred by post World Cup slump, Rand uncertainty and
global recession woes, all making long-term FMCG market planning somewhat
hazardous. Our strategy of diversity through vertical integration proved
wise.
In March Friedel Sass became Chief Executive Officer.
A subsidiary has been reported for a suspected breach of fiduciary duty
pertaining to unauthorised advance payments for the supply of goods. The
full amount has been recovered and therefore no loss has occurred and
remedial steps have been taken to prevent a re-occurrence.
Subsequent to year-end the company purchased the minority share in Quality
Beverages 2000 (Pty) Ltd for R23 million. At the same time it granted the
minority shareholder the option, for a limited period, to reacquire the 25.1%
shareholding at the same price.
Plastic operations
Several smaller customers were victims of market conditions leaving the
industry with a more robust but demanding multinational customer base who
resisted price increases despite raw material rises of 11% to 21%,
electricity increases of 40% and labour of 7.8%. Of the 9.4% increase in
revenue, only 3% were price increases. The flat earnings on the plastics
division at R53.6m (-1%) reflected the defensive position adopted.
Certain capex was deferred favouring significant upgrades to existing
equipment and R10m worth will arrive in the 2012 year. Significant
expenditure was made on new moulds and optimization engineering, which will
benefit future competitiveness.
All 4 operating plants had positive results, including Gad-Tek, supplying
customers in KZN and the Eastern Cape. Despite severe 2011 pressures, Bowler
Plastics came through well. Our order book is the fullest in 10 years, and
the machinery, products and people are in place to ensure on-going
profitability in the 2012 year.
Filling Operations
The meteoric growth of QB continued. Revenue rose 26% to R331m and
attributable profit 115% to R15.3m, equating to 24 month average eps growth
of 8.9c and vindicate marketing strategy and branding initiatives. Western
Cape grew market share, and the Gauteng division improved to a breakeven. The
upturn in brand loyalty of Jive, Qua Blue, and Planet has been most
encouraging as has the growth in the higher LSM market which augers well.
Hashim Amla has been contracted to be the brand ambassador.
The new 7500m2 Boksburg factory will begin production in October and the
final investment will be some R30m. A continuous improvement in this
lucrative market is likely as we replicate the proven Western Cape model.
Competition will be stiff but we believe our proven niche and exceptional
products should show a profit within 24 months. The concomitant benefits to
Bowler Plastics with regard to bottles, crates and caps supply are obvious
and follow naturally.
Prospects
Notwithstanding the challenging market conditions, given the established
position in the market of both Bowler Plastics and Quality Beverages, coupled
with a significant war chest and the strong staff that we have at our
disposal, I have every reason to believe that a continued growth in Bowler
Metcalf`s fortunes can be expected in the 2012 year.
BASIS OF PREPARATION AND REVIEW REPORT
The reviewed condensed consolidated results have been prepared in accordance
with the Framework concepts and the measurement and recognition requirements
of the International Financial Reporting Standards, containing information
required by the IAS 34 Interim Financial Reporting, the AC500 standards as
issued by the Accounting Practices Board and in the manner required by the
Companies Act and the JSE Limited`s Listing Requirements.
In terms of the Auditing Profession Act, Mazars reported a reportable
irregularity relating to a suspected breach of fiduciary duty to the
Independent Regulatory Board for Auditors, refer to Comment section for
further detail.
The unmodified review report of the company`s auditors, Mazars, is available
for inspection at the company`s registered office.
This provisional report has been prepared using the same accounting policies
and methods of computation as used in the most recently issued annual
financial statements, which should be read in conjunction with this
provisional report.
DIVIDEND DECLARATION
A final dividend of 20.0c per share (2010: final dividend of 15.0c) has been
declared and is payable to shareholders on Monday, 31 October 2011. The last
day to trade will be Friday, 21 October 2011. "Ex" dividend trading begins on
Monday, 24 October 2011 and the record date will be Friday, 28 October 2011.
Share certificates may not be dematerialised or re-materialised between
Monday, 24 October 2011 and Friday, 28 October 2011, both days inclusive. No
tax consequences are expected.
Unless otherwise requested in writing, individual dividend cheques of less
than R50 will not be paid but retained in the company`s unclaimed dividend
account. Accumulated unpaid dividends in excess of R200 may be claimed in
writing from the Transfer Secretaries.
H.W. SASS (Non-Exec Chairman)
M. BRAIN (Vice Chair & Fin. Director)
Cape Town, 29 September 2011
Prepared by: LV Rowles CA(SA)
Sponsor
Arcay Moela Sponsors (Pty) Limited
Auditors
Mazars Moores Rowland
Transfer Secretaries
Computershare Investor Services 2004 (Pty) Limited
Date: 30/09/2011 07:06:36 Produced by the JSE SENS Department.
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