| Wed 14 Mar 2001, 0:00 | | Adcorp Holdings Limited - Audited Results |
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Adcorp Holdings Limited
Registration number 1974/001804/06
Audited Results for the year ended 31 December 2000
Turnover up 40,6%
Headline earnings per share up 27,2%
Operating profit up 41,5%
Attributable profit up 36,9%
Consolidated Group Income Statement
2000 1999 %
R'000 R'000 Var
TURNOVER 963 443 685 460 +40,6
Operating profit 93 364 65 981 +41,5
Net investment income 6 021 8 654 -30,4
(Loss)/Profit on sale of assets (380) 514 -
Profit before taxation 99 005 75 149 +31,7
Taxation 26 914 21 219 +26,8
Profit after taxation 72 091 53 930 +33,7
Share of income/(loss)
attributable to associate
companies 223 (552) -
72 314 53 378 +35,5
Minority shareholders'
share of losses -* (547) -
Earnings attributable to
ordinary shareholders 72 314 52 831 + 36,9
- Reconciliation of headline
earnings
Earnings attributable
to shareholders 72 314 52 831 36,9
Goodwill amortised 2 835 - -
Loss/(Profit) on sale of assets 380 (547) -
Headline earnings 75 529 52 284 +44,5
Number of shares in
issue - weighted (000) 39 338** 34 633 +13,6
Headline earnings per
share - cents 192 151 +27,2
Earnings per share - cents 184 153 +20,3
Dividend per share - cents 28 23 +21,7
Dividend cover - times 6,6 6,6 -
* Adcorp has assumed responsibility for losses made by minorities. These
losses are not material.
** Weighted average after taking into account the estimated number of shares
that will be issued for the purchase of Graphicor (Pty) Limited.
Consolidated Group Balance Sheet
31/12/00 31/12/99
R'000 R'000
ASSETS
NON-CURRENT ASSETS 191 400 70 868
FIXED ASSETS 61 938 37 005
INVESTMENTS AND LOANS 123 201 33 863
DEFERRED TAXATION 6 261 -
CURRENT ASSETS 229 945 208 157
Cash at bank 47 416 96 405
Other current assets 182 529 111 752
Total assets 421 345 279 025
EQUITY AND LIABILITIES
Capital and reserves 233 453 97 299
Share capital and reserves 241 614 95 135
Cost price of shares held
by subsidiary (14 183) -
Vendor shares 6 022 2 164
Non-current liabilities 10 675 11 279
Minority shareholders' interest - 134
Interest bearing long-term
liabilities 7 313 10 953
Deferred taxation 3 362 192
Current liabilities 177 217 170 447
Interest bearing current
liabilities 44 769 6 869
Cash due to vendors 10 122 72 018
Non-interest bearing current
liabilities 122 326 91 560
Total equity and liabilities 421 345 279 025
Number of ordinary shares
in issue (000) 40 830 34 926
Net asset value per
share - cents 572* 278
* Based on 40,830 million shares which includes the shares anticipated to be
issued for the purchase of Graphicor (Pty) Limited.
Summarised Group Cash Flow Statement
2000 1999
R'000 R'000
CASH GENERATED BY OPERATIONS 113 145 74 419
INCREASE IN WORKING CAPITAL (34 997) (14 871)
CASH GENERATED BY
OPERATING ACTIVITIES 78 148 59 548
NET INVESTMENT INCOME 6 021 8 654
TAXATION PAID (31 231) (21 075)
DIVIDEND PAID (8 033) (5 283)
CASH AVAILABLE FROM OPERATING
ACTIVITIES 44 905 41 844
CASH EFFECTS FROM INVESTMENT
AND FINANCING ACTIVITIES (131 794) (32 372)
NET CASH MOVEMENT (86 889) 9 472
CASH ON HAND AT THE BEGINNING
OF THE YEAR 89 536 80 064
NET CASH ON HAND AT THE
END OF THE YEAR 2 647 89 536
Comments
Adcorp performed well during the year ended 31 December 2000 given that trading
conditions were difficult. Highlights of the year included the acquisition of
Acumen and Graphicor, both of which have been well integrated into the group.
Adcorp also purchased PR Connections, a niched public relations company
specialising in IT as well as a 50,1% share in Equal Access, a black
recruitment business with a sound track record.
A further exciting development is the joint venture formed between Adcorp
company, Research Surveys and Taylor Nelson Sofres (TNS), one of the largest
research companies in the world. This agreement will enable Research Surveys'
Conversion Model product to increase its market share globally as well as to
maintain its position as the "gold standard" of brand equity products. In
addition, Research Surveys will have access to TNS products and expertise in
the South African market.
Shepherd Shonhiwa recently joined the Adcorp board as deputy chairman and
Israel Skosana has also been appointed to the board. John Barry and Alec
Rubinstein have become non-executive directors. In April Adcorp donated almost
R1 million to The Business Trust and has recently established a social
investment programme aimed primarily at supporting black women in business.
Towards the end of the year, Adcorp Management Services (Pty) Limited, a
subsidiary of Adcorp Holdings Limited bought back 1 million shares in a share
buy-back transaction.
Operations
THE OPERATING DIVISIONS HAVE BEEN REORGANISED IN ORDER TO BETTER FACILITATE THE
OFFERING OF COMPLETE BUSINESS SOLUTIONS TO CLIENTS WITH A FOCUS ON CLIENTS
RATHER THAN PRODUCTS. RECRUITMENT ADVERTISING AND PERMANENT PLACEMENTS NOW FORM
ONE DIVISION AS TOGETHER THEY PROVIDE THE WHOLE RANGE OF PERMANENT STAFFING
SOLUTIONS. HUMAN CAPITAL MANAGEMENT IS A SEPARATE DIVISION ENCOMPASSING HUMAN
RESOURCE SERVICES, TRAINING AND FLEXIBLE (TEMPORARY/CONTRACT) STAFFING. OUR
EXPERIENCE IS THAT MANY OUTSOURCED STAFFING SOLUTIONS REQUIRE NOT ONLY THE
STAFFING COMPONENT, BUT ALSO HUMAN RESOURCE MANAGEMENT AND TRAINING
CAPABILITIES. THE THIRD DIVISION COMPRISES CORPORATE COMMUNICATIONS AND DESIGN
AS WELL AS RESEARCH. IT IS OUR INTENTION TO EXTEND THIS SERVICE RANGE TO COVER
OTHER BUSINESS REQUIREMENTS. THE NEW STRUCTURE IS WORKING WELL WITH PLEASING
RESULTS BOTH FROM A PROFIT AND OPPORTUNITY PERSPECTIVE AS EVIDENCED BY THE
POSITIVE TRADING RESULTS FOR THE FIRST TWO MONTHS OF THE NEW YEAR.
Prospects
WE ARE UNIQUELY POSITIONED AS A LEADER IN THE PROFESSIONAL SERVICES VALUE CHAIN
WHERE GROWTH HAS LESS TO DO WITH ABSOLUTE MARKET GROWTH BUT RATHER WITH THE
RATE AT WHICH IN-HOUSE DELIVERY IS OUTSOURCED. WE HAVE THE ABILITY TO OFFER
INTEGRATED SUPPORT SERVICES JUSTIFYING HIGHER MARGINS.
Dividend
THE DIRECTORS HAVE DECLARED A DIVIDEND OF 28 CENTS PER SHARE WHICH IS A 21,7%
INCREASE ON THE 1999 DIVIDEND AND REPRESENTS A 6,6 TIMES COVER. DIVIDENDS WILL
BE PAID ON OR ABOUT 7 MAY 2001 TO SHAREHOLDERS REGISTERED AS AT THE CLOSE OF
BUSINESS ON 6 APRIL 2001.
BY ORDER OF THE BOARD
DR F VAN ZYL SLABBERT DR FH STAAL F BURD
CHAIRMAN CHIEF EXECUTIVE OFFICER FINANCIAL DIRECTOR
14 MARCH 2001
Directors: Dr F van Zyl Slabbert (Chairman), Dr FH Staal (Chief Executive
Officer), RL Pike (Deputy Chief Executive Officer), VC Baker*, HW Barenblatt*,
FD Burd, M Liphosa, Dr RD Marcus, RB McGregor
Non-executive Directors: S Shonhiwa (Deputy Chairman), Dr DE Baloyi, JK Barry,
Dr FP Jacobsz, Dr P Ngwenya, L Rouillard, L Roussos*, A Rubinstein, I Skosana
Alternate: R Pearce
*Executive directors in group companies
Visit our website at http://www.adcorp.co.za
