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TPC
TPC
TPC - Transpaco Limited - Unaudited interim group results for the 6 months ended
31 December 2011 and dividend announcement
Transpaco Limited
Reg. No. 1951/000799/06
ISIN: ZAE000007480
Share Code: TPC
UNAUDITED INTERIM GROUP RESULTS FOR THE 6 MONTHS ENDED 31 DECEMBER 2011 AND
DIVIDEND ANNOUNCEMENT
NET PROFIT AFTER TAX UP 10%*
DILUTED HEADLINE EARNINGS PER SHARE UP 7%*
DIVIDEND PER SHARE UP 7%
* Continuing operations
INTRODUCTION
Transpaco continued to deliver growth with pleasing results for the six
months to 31 December 2011 ("the period"). The acquisition of Disaki Cores
and Tubes (Pty) Ltd ("Disaki") contributed positively to these results.
The unanticipated industry-wide national strike during July 2011 had an
estimated R3,6 million negative impact on net profit after taxation.
The under-performing PVC and PET businesses were discontinued during the
period.
FINANCIAL RESULTS
Transpaco`s net profit after tax for continuing operations increased by
10,3% to R45,3 million (December 2010: R41,1million).
Earnings per share for continuing operations ("EPS") decreased slightly by
1,9% to 143,0 cents (December 2010: 145,8 cents). Headline earnings per
share for continuing operations ("HEPS") decreased by 3,1% to 141,0 cents
(December 2010: 145,5 cents).
The reduction in EPS and HEPS and the increase in the ranking and weighted
average number of shares in issue were respectively the result of:
- the additional 3 300 000 ordinary shares in issue following the
conversion by Transpaco`s B-BBEE shareholder of its preference shares
into ordinary shares ("the B-BBEE share conversion");
- 173 000 ordinary shares being taken up in terms of the Transpaco Share
Option Scheme;
both of which took place during the latter part of the previous financial
year. These additional ordinary shares resulted in an 11.8% dilution.
There are no further convertible preference shares in issue.
Diluted earnings per share for continuing operations increased by 8,5% to
139,1 cents (December 2010: 128,2 cents), while diluted headline earnings
per share for continuing operations increased by 7,2% to 137,2 cents
(December 2010: 127,9 cents).
The inclusion of turnover from the Disaki acquisition for an additional
four months saw turnover for continuing operations up 21,2% to R552,8
million (December 2010:R456,2 million). This resulted in operating profit
improving by 4,2% to R63,3 million (December 2010: R60, 8 million). The
group`s operating costs were well managed within expectations and increased
in line with operational needs.
Strong cash flows led to a reduction of R1,0 million in net interest paid,
while net interest cover improved to 116,0 times (December 2010: 34,9
times). Stringent asset control and the group`s profitability resulted in
the net interest-bearing debt: equity ratio remaining in the single digits
at 7% (December 2010: 3%).
The ranking and weighted number of shares in issue increased significantly
due to the B-BBEE share conversion and shares being taken up in terms of
the Transpaco Share Option Scheme.
Net asset value per share increased by 9,6% to 959 cents (December 2010:
875 cents).
PROSPECTS
The closure of the PVC and PET operations has allowed Transpaco to redeploy
resources into an exciting new venture. The group is in the process of
establishing a high volume polypropylene recycling facility, which will
complement Transpaco`s commitment to recycling.
Transpaco has made substantial investments in new plant and equipment in
order to increase capacities and to ensure its competitiveness both locally
and against imports.
The group will continue in its endeavours to achieve further organic growth
and to pursue appropriate acquisitions.
DIVIDEND
The board has declared an interim cash dividend of 31 cents per share
(December 2010: 29 cents per share) for the six-month period ending 31
December 2011 representing a 7% increase on the comparative period.
The salient dates for the dividend are as follows:
Last date to trade shares cum dividend Thursday, 15 March 2012
Shares trade ex dividend Friday, 16 March 2012
Record date Friday, 23 March 2012
Payment date Monday, 26 March 2012
Share certificates may not be dematerialised or rematerialised between Friday,
16 March 2012, and Friday, 23 March 2012, both days inclusive.
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The unaudited interim financial results for the period are prepared in
accordance with the recognition and measurement criteria of International
Financial Reporting Standards ("IFRS"), with presentation and disclosure in
terms of IAS 34 - Interim Financial Reporting, and in compliance with the
Listings Requirements of the JSE Limited and the South African Companies Act No
71 of 2008.
The accounting policies applied in these unaudited interim financial statements
are consistent in all material respects with those applied in the preparation of
the group`s annual financial statements for the previous year ended 30 June
2011. The group adopted all applicable new and amended standards, which did not
have an impact.
ON BEHALF OF THE BOARD
AJ Aaron PN Abelheim L Weinberg
Non-executive Chairman Chief Executive Financial Director
DIRECTORS
AJ Aaron (Chairman)*; PN Abelheim (Chief Executive); L Weinberg (Financial
Director); HA Botha*; SR Bouzaglou; SI Jacobson*; D Thomas*; SP van der Linde*
*non-executive
Date 22 February 2012
Auditors Ernst & Young Incorporated
Company Secretary HJ van Niekerk
Sponsor Investec Bank Limited
Registered Office 331 6th Street, Wynberg, Sandton
Transfer Secretaries Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg
Website www.transpaco.co.za
STATEMENT OF COMPREHENSIVE INCOME
R`000 Unaudited % Unaudited Audited
6 months change 6 months 12 months
Notes Dec 2011 Dec 2010 June 2011
CONTINUING OPERATIONS
Revenue 553 684 457 226 907 909
Turnover 552 785 21,2 456 154 906 058
Cost of sales (346 802) (277 651) (549 436)
Profit before operating 205 983 15,4 178 503 356 622
costs and depreciation
Operating costs (129 926) (106 044) (225 206)
Depreciation (12 759) (11 706) (24 006)
Operating profit 63 298 4,2 60 753 107 410
Finance costs relating (1 543) (2 760) (4 677)
to financial instruments
Interest received 899 1 072 1 851
Profit before taxation 62 654 6,1 59 065 104 584
Taxation (17 333) (17 960) (31 683)
Profit after taxation 45 321 10,3 41 105 72 901
from continuing
operations
DISCONTINUED OPERATIONS
Loss after taxation from 1 (2 809) (1 014) (8 812)
discontinued operations
Profit after taxation 42 512 6,0 40 091 64 089
Other comprehensive - - -
income
Total comprehensive 42 512 6,0 40 091 64 089
income
Weighted average ranking 31 691 28 200 29 606
number of shares in
issue (`000)
Diluted weighted average 32 577 32 070 32 397
ranking number of shares
in issue (`000)
Continuing operations
Earnings per share 143,0 (1,9) 145,8 246,2
(cents)
Fully diluted earnings 139,1 8,5 128,2 225,0
per share (cents)
Headline earnings per 141,0 (3,1) 145,5 243,7
share (cents)
Fully diluted headline 137,2 7,2 127,9 222,7
earnings per share
(cents)
Continuing and
discontinued operations
Earnings per share 134,1 (5,6) 142,2 216,5
(cents)
Fully diluted earnings 130,5 4,1 125,3 198,0
per share (cents)
Headline earnings per 132,3 (7,0) 141,9 214,0
share (cents)
Fully diluted headline 128,7 2,9 125,1 195,7
earnings per share
(cents)
Dividend per share 31,0 6,9 29,0 72,0
(cents)*
*Dividend declared after
the period
Reconciliation of
headline earnings
(R`000)
Continuing operations
Basic earnings 45 321 41 105 72 901
Negative goodwill - - (191)
Profit on disposal of (628) (77) (551)
property, plant and
equipment
Headline earnings 44 693 41 028 72 159
Continuing and
discontinued operations
Basic earnings 42 512 40 091 64 089
Negative goodwill - - (191)
Profit on disposal of (590) (77) (551)
property, plant and
equipment
Headline earnings 41 922 40 014 63 347
STATEMENT OF FINANCIAL POSITION
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2011 Dec 2010 June 2011
ASSETS
Non-current assets 171 008 163 150 167 862
Property, plant and 164 160 151 829 159 231
equipment
Intangibles 482 482 482
Goodwill 3 204 3 204 3 204
Unlisted investments 33 33 33
Deferred taxation 3 129 7 602 4 912
Current assets 329 942 350 146 319 815
Inventories 90 662 93 682 89 422
Trade and other receivables 223 858 196 080 148 729
Taxation receivable 972 781 1 171
Cash at bank and in hand 14 450 59 603 80 493
Assets classified as held 2 765 - -
for sale
TOTAL ASSETS 503 715 513 296 487 677
EQUITY AND LIABILITIES
Capital and reserves 303 944 256 598 274 480
Issued share capital 317 283 317
Share premium 11 019 - 11 019
Other reserves 1 783 533 1 204
Preference shareholder`s - 9 273 -
interest
Distributable reserve 290 825 246 509 261 940
Non-current liabilities 36 287 46 476 43 766
Preference share liability - 1 109 -
Interest-bearing borrowings 17 178 28 187 25 894
Deferred taxation 19 109 17 180 17 872
Current liabilities 163 484 210 222 169 431
Trade payables and accruals 127 872 158 464 128 805
Provisions 13 546 11 162 16 443
Current portion of interest-17 676 20 548 20 438
bearing borrowings
Taxation payable 4 390 3 556 3 745
Bank overdraft - 16 492 -
TOTAL EQUITY AND 503 715 513 296 487 677
LIABILITIES
Number of shares in issue
(`000)
(Net of treasury shares) 31 691 28 192 29 865
Net movement in treasury - 73 1 826
shares
Ranking number of shares 31 691 28 265 31 691
Salient features
Net asset value per share 959 875 866
(cents)
Operating margin % 10,5 12,3 10,0
Net interest-bearing debt: 7 3 Net cash
equity ratio % positive
Net interest cover (x) 116,0 34,9 33,3
STATEMENT OF CASH FLOW
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2011 Dec 2010 June 2011
Cash flow from operating
activities
Cash (utilised)/generated (8 127) 35 225 129 070
from operations
Dividends paid (13 627) (10 715) (19 906)
Finance costs from (1 543) (2 760) (4 677)
continuing operations
Finance costs from - (12) (34)
discontinued operations
Interest received from 899 1 072 1 851
continuing operations
Interest received from 133 - -
discontinued operations
Taxation paid (12 377) (8 468) (15 288)
Net cash (outflow)/inflow (34 642) 14 342 91 016
from operating activities
Cash flow from investing
activities
Proceeds on disposal of 10 025 155 1 543
property, plant and
equipment
Expansion and replacement (29 948) (10 296) (31 979)
of property, plant and
equipment
Acquisition of new business - (26 038) (43 107)
Net cash outflow from (19 923) (36 179) (73 543)
investing activities
Cash flow from financing
activities
Decrease in interest- (8 716) (9 186) (11 479)
bearings borrowings
Decrease in current portion (2 762) (1 738) (2 668)
of interest-bearing
borrowings
Decrease in preference - (1 013) (343)
share liability
Net movement in treasury - 165 790
shares
Net cash outflow from (11 478) (11 772) (13 700)
financing activities
Net movement in cash for (66 043) (33 609) 3 773
the period
Cash and cash equivalents 80 493 76 720 76 720
at the beginning of the
period
Cash and cash equivalents 14 450 43 111 80 493
at the end of the period
STATEMENT OF CHANGES IN EQUITY
R`000 Issued Share Other Pre- Dis- Total
Share Premium Reserves ference tributable
Capital Share- Reserves
holder`s
Interest
Balance at 30 282 - 9 273 469 216 969 226 993
June 2010
(audited)
Total - - - - 64 089 64 089
comprehensive
income
Share-based - - - 735 - 735
payments
Dividend paid - - - - (19 906) (19 906)
Shares issued 33 11 019 (9 273) - - 1 779
Net movement 2 - - - 788 790
in treasury
shares
Balance at 30 317 11 019 - 1 204 261 940 274 480
June 2011
(audited)
Total - - - - 42 512 42 512
comprehensive
income
Share-based - - - 579 - 579
payments
Dividend paid - - - - (13 627) (13 627)
Balance at 31 317 11 019 - 1 783 290 825 303 944
December 2011
(unaudited)
SEGMENTAL ANALYSIS
R`000 Plastic Paper Properties Total
Products and and Group Total Dis-
Board Services Continuing continued
Products Operations Operations
Turnover - 351 075 201 710 - 552 785 11 128 563
2011 913
Revenue to 370 933 210 917 - 581 850 11 133 592
external 983
customers
Less 19 858 9 207 - 29 065 5 29 070
revenue to
internal
customers
Turnover - 318 686 137 468 - 456 154 28 051 484
2010 205
Revenue to 334 636 146 188 - 480 824 28 051 508
external 875
customers
Less 15 950 8 720 - 24 670 - 24 670
revenue to
internal
customers
Operating 40 783 20 717 1 798 63 298 (4 034) 59 264
profit -
2011
Operating 43 472 16 755 526 60 753 (1 393) 59 360
profit -
2010
CAPITAL COMMITMENTS
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2011 Dec 2010 June 2011
Capital expenditure
authorised and contracted
Plant and equipment 27 982 4 746 24 178
LOSS ON DISCOUNTUNED OPERATIONS
Note 1: The results of the discontinued operations included in the statement of
comprehensive income are set out below. The comparative loss and cash flows from
the discontinued operations have been re-presented to include the operations
classified as discontinued in the current period.
R`000 Unaudited Unaudited Audited
6 months 6 months 12 months
Dec 2011 Dec 2010 June 2011
Turnover 11 128 28 051 47 931
Expenses (15 029) (29 456) (60 165)
Loss before tax from (3 901) (1 405) (12 234)
discontinued operations
Taxation 1 092 391 3 422
Loss after tax from (2 809) (1 014) (8 812)
discontinued operations
Earnings per share (cents) (8,9) (3,6) (29,8)
Fully diluted earnings per (8,6) (3,2) (27,2)
share (cents)
Headline earnings per share (8,7) (3,6) (29,8)
(cents)
Fully diluted headline (8,5) (3,2) (27,2)
earnings per share (cents)
Cash flows from
discontinued operations
Net cash flows from (9 017) 1 299 1 794
operating activities
Net cash flows from 7 292 (183) (775)
investing activities
Net cash flows from - (103) (201)
financing activities
Net cash flows (1 725) 1 013 818
Date: 22/02/2012 07:05:01 Produced by the JSE SENS Department.
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