| Tue 27 Mar 2001, 0:00 | | Corpcapital - Interim Results |
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Corpcapital Limited
(Registration number 1946/023536/06)
("Corpcapital")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2001
FINANCIAL HIGHLIGHTS
- Headline earnings up 29%
- Headline earnings share up 25%
- Total shareholders' equity over R1 billion
CONSOLIDATED INCOME STATEMENT
6 months 6 months Year
28 Feb 28 Feb % 31 Aug
R'000s 2001 2000 change 2000
Interest received 47 703 33 230 73 363
Interest paid 39 313 21 075 40 783
Net interest income 8 390 12 155 (31) 32 580
Investing, trading and
fee income 210 339 167 628 361 861
Equity accounted income 14 303 6 272 21 066
Non-interest income 224 642 173 900 29 382 927
Specific provisions (2 050) - (2 200)
Convertible loan interest (43 599) (36 095) 21 (76 354)
Total income 187 383 149 960 25 336 953
Operating expenses 50 169 34 549 45 94 844
Profit before taxation and
exceptional item 137 214 115 411 19 242 109
Exceptional regulatory
increase in provisions 10 000 - -
Profit before taxation 127 214 115 411 10 242 109
Taxation 22 578 24 565 (8) 51 457
Ordinary operations 25 578 24 565 51 457
Exceptional item (3 000) - -
Profit after taxation 104 636 90 846 15 190 652
Attributable to minority
shareholders 27 791 28 600 57 251
Attributable profit 76 845 62 246 23 133 401
Headline earnings
adjustment in respect
of regulatory provisions 3 430 - -
Headline earnings 80 275 62 246 29 133 401
Headline earnings
per share (cents) 12,1 9,7 25 20,6
Earnings per share 11,6 9,7 20 20,6
Diluted headline earnings
per share (cents) 12,0 9,5 26 16,1
Diluted earnings per share 11,5 9,5 21 16,1
Average weighted shares
in issue (000) 661 044 639 154 648 747
Note: This interim report has been prepared using accounting policies that are
consistent with those applied in the prior year excepting for the provision of
depreciation (R242 000) on the group's operating premises. Corresponding
amounts have been regrouped where necessary.
CONSOLIDATED BALANCE SHEET
6 months
28 Feb 28 Feb 31 Aug
R'000s 2001 2000 2000
Assets
Cash and short-term funds 318 941 263 586 408 839
Liquid assets and trading accounts 2 050 912 1 441 471 1 184 009
Investments 1 068 775 843 755 910 936
Advances and other accounts 302 236 243 944 339 012
Associate 243 775 163 297 229 225
Property and equipment 42 247 45 037 43 170
4 026 886 3 001 090 3 115 191
Equity
Share capital and premium 334 058 372 857 334 100
Reserves 301 400 149 520 242 577
Ordinary shareholders' equity 635 458 522 377 576 677
Minority shareholders' interest 379 166 336 697 363 732
Total shareholders' equity 1 014 624 859 074 940 409
Compulsorily convertible loan 304 114 304 114 304 114
Liabilities
Deferred taxation 89 783 38 743 73 853
Convertible loan interest 170 939 88 903 127 340
Deposits and interest bearing
accounts 885 928 320 891 466 650
Repurchase agreements and short
positions 1 450 047 1 213 954 1 051 839
Creditors, taxation and provisions 111 451 175 411 150 986
4 026 886 3 001 090 3 115 191
Net tangible asset value
per share (cents) 96 79 89
Contingent liabilities
Bank guarantees and letters
of credit 50 420 55 000 97 262
Suretyship for loan to investment 20 089 15 363 22 344
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
Operating and financing activities (75 348) (165 893) 155 591
Investing activities (14 550) (66 778) (243 009)
Movement in cash and
short-term funds (89 898) (232 671) (87 418)
Opening cash and short-term funds 408 839 496 257 496 257
Closing cash and short-term funds 318 941 263 586 408 839
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
6 months
28 Feb 28 Feb 31 Aug
R'000s 2001 2000 2000
Ordinary shareholders' equity
at beginning of period 576 677 461 213 461 213
Attributable profit 76 845 62 246 133 401
Share issues and other
changes in equity (42) (1 082) (17 937)
Dividend paid (18 022) -
Ordinary shareholders' equity 635 458 522 377 576 677
SEGMENTAL INFORMATION
Corpcapital
Corpcapital Bank Group
Total income 89 216 98 167 187 383
Operating expenses 19 463 30 706 50 169
Profit before taxation and
exceptional items 69 753 67 461 137 214
Taxation and exceptional items 19 609 12 969 32 578
Profit after taxation 50 144 54 492 104 636
Sources of income
Annuity and fee income 82 436 55 337 126 387
Trading, arbitrage, investing
and deal income 106 996 94 623 212 766
Total income before provisions 189 432 149 960 339 153
REVIEW
Corpcapital continues to deliver pleasing results showing a 25% increase
in headline earnings per share from 9,7 cents to 12,1 cents, all
comprising organic growth. Corpcapital
Bank delivered a 10% growth in headline earnings per share. Strong performance
in other divisions, in particular Proprietary investments, resulted in total
income increasing by 25% and profit before taxation and exceptional items
increasing by 19% to R137,2 million, despite an increase of 45% in operating
expenses caused by investment in new divisions, infrastructure and enhanced
human capital resources. The cost to income ratio has decreased to 26,5%.
Headline earnings increased from R62,2 million to R80,3 million, an increase of
29%. Ordinary shareholders' equity increased to R635 million and total
shareholders equity to R1 billion. Net tangible asset value per share increased
to 96 cents. The results reflect compliance with the requirements of AC 133,
trading investments having been brought to account at fair value which is
consistent with their historic accounting treatment. Corpcapital Bank's
compliance with new regulatory provisioning requirements resulted in an
exceptional after-tax charge of R7 million against assets and advances.
The excellent performance of Proprietary Investments is attributable to the
quality of the underlying investments as well as their geographic and industry
sector diversity. Investments have increased their hard currency revenues
wherever possible.
The Corporate Finance Division continues to provide fully integrated services
to the group and its third party clients, for example through their involvement
in the development of products such as SATRIX 40, South Africa's first listed
index-tracking security, reinforcing the group's ability to provide a total
financial service solution.
The recently established Private Equity Fund Management Business is advancing
well towards establishing its first funds under management.
Much effort has been devoted towards establishing a stable platform from which
Corpcapital Bank can develop its business, in particular the attraction of
deposits, which are markedly increasing.
The Bank's Structured Products Division anticipates that in the second half of
the year it will reap the rewards of its extensive product development efforts.
The Property Division will imminently assume the asset management of ApexHi,
the recently listed property loan stock company, which will augment the
division's existing property asset management activities. Despite volatile
markets and reduced risk exposures, the trading activities of the Treasury
Division continued to contribute significantly to earnings. The group's income
derived from annuity and fee income now amounts to 44% of total income before
provisions.
Extensive resources have been devoted to the continuing process of building the
group's brand. Recent market research shows a sharp increase in brand
recognition and improvement in the perception of the group.
The group continues to attract and retain premier intellectual capital due to
its strong corporate culture and commitment to the goal of developing a
seamless integrated investment banking and financial services group.
Merger
The intended merger of the assets and businesses of Corpgro and Corpcapital is
referred to in a cautionary announcement published separately with the
announcement of these results. Following the merger, Corpcapital will continue
to own 49% of the equity capital of Corpcapital Bank Controlling Company
Limited with the intention of increasing its holding to 100%, when practicable,
subject to Ministerial approval.
Prospects
Prospects for Corpcapital are encouraging. Its flexible integrated
multi-disciplinary services coupled with its ability to innovate, are well
received. Investments are diversified and well managed within strictly defined
financial and operational parameters. We are confident of our ability to
continue delivering above-average returns to all of our stakeholders.
Dividend
Corpcapital's dividend policy is to declare an annual dividend on publication
of audited year-end results.
By order of the board
Errol Grolman Martin Sacks
Executive chairman Managing director
27 March 2001
Directors: E Grolman (Executive Chairman) N Lazarus B Liebmann J Liebesman*
M Sacks (Managing Director) W Trengove*
(*non-executive)
Registered Office: 2 Arnold Road, Rosebank, Johannesburg Telephone: (2711)
283-0190 Fax: (2711) 283-0066 E-mail: info@corpcapital.com Transfer
Secretaries: Mercantile Registrars Limited 11 Diagonal Street, Johannesburg
2001 (P O Box 1054, Johannesburg 2000)
These results can be viewed at: www.corpcapital.com
