| Tue 27 Mar 2001, 0:00 | | Corpgro - Interim Results |
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Corpgro Limited
(Registration number 1983/011384/06)
("Corpgro")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 28 FEBRUARY 2001
Financial highlights
- Headline earnings up 22%
- Headline earnings per share 31,8 cents
- Total shareholders' equity R1,3 billion
Consolidated income statement
6 months 6 months Year
28 Feb 28 Feb % 31 Aug
R'000s 2001 2000 change 2000
Non-interest income 285 765 214 462 33 487 302
Investing, trading and fee income 222 561 168 528 367 861
Equity accounted income 14 303 6 272 24 246
Contribution from consolidated
investments 48 901 39 662 95 195
Net interest income 2 310 12 769 32 119
Specific provisions (2 050) - (2 200)
Convertible loan interest (43 599) (36 095) (76 354)
242 426 191 136 27 440 867
Operating expenses 50 915 32 461 57 89 968
Profit before taxation and
exceptional items 191 511 158 675 21 350 899
Exceptional items 10 538 - -
Regulatory increase in provisions 10 000 - -
Amortisation of goodwill 538 - -
Profit before taxation 180 973 158 675 14 350 899
Taxation 36 692 33 611 9 72 490
Ordinary operations 39 692 33 611 72 490
Exceptional items (3 000) - -
Profit after taxation 144 281 125 064 15 278 409
Attributable to minority
shareholders 66 673 59 700 126 695
Attributable profit 77 608 65 364 19 151 714
Headline earnings adjustment in
respect of exceptional items 2 422 - -
Headline earnings 80 030 65 364 22 151 714
Headline earnings per share (cents) 31,8 26,0 22 60,3
Earnings per share 30,8 26,0 18,5 60,3
Diluted earnings per share 30,8 26,0 18,5 60,3
Weighted average shares in issue
and to be issued 251 588 251 588 - 251 588
Sources of income
Contribution from consolidated
investments, annuity and fee income 125 257 95 613 221 121
Trading, arbitrage, investing and
deal income 119 219 95 523 221 946
Total income before provisions 244 476 191 136 443 067
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 and the adoption of
AC 131 for business combinations which resulted in the recognition of goodwill
and the amortisation thereof over its estimated useful life. 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 352 220 297 167 460 548
Liquid assets and trading
securities 2 050 912 1 441 471 1 184 009
Current assets of consolidated
investments 375 925 307 642 357 657
Investments 1 109 709 862 030 913 730
Advances and other accounts 322 783 243 944 339 012
Deferred taxation 32 353 29 788 83 539
Associate 243 775 195 648 262 356
Goodwill and trademarks 20 618 154 400 -
Property plant and equipment 202 034 181 886 192 588
4 710 329 3 713 976 3 743 439
Equity
Share capital and premium 164 385 189 086 164 385
Retained earnings and reserves 466 408 463 273 413 860
Ordinary shareholders' equity 630 793 652 359 578 245
Minority shareholders' interest 686 670 631 916 639 435
Total shareholders' equity 1 317 463 1 284 275 1 217 680
Compulsorily convertible loan 304 114 304 114 304 114
Liabilities
Interest-bearing debt 168 194 68 284 106 586
Deferred taxation 99 895 48 846 84 354
Convertible loan interest 170 939 88 903 127 340
Deposits and interest-bearing
accounts 826 728 262 390 506 813
Repurchase agreements and short
positions 1 450 047 1 213 954 1 051 839
Creditors, taxation and provisions 244 850 362 813 232 343
Purchase consideration payable 128 099 80 397 112 370
4 710 329 3 713 976 3 743 439
Net tangible asset value per
share (cents) 243 198 230
Contingent liabilities
Bank guarantees and letters of
credit 50 420 55 000 97 262
Suretyship for loan to share trust 87 725 77 585 82 639
Suretyship for loan to investment 20 089 15 363 22 344
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 578 245 606 978 606 978
Attributable profit 77 608 65 364 151 714
Dividend (26 417) - -
Goodwill and trademarks written of - (29 759) (174 901)
Changes in holding in subsidiaries 1 357 (5 675) (11 551)
Change in accounting policy and
other changes - 15 451 6 005
630 793 652 359 578 245
Condensed consolidated cash flow
statement
Cash generated from operations 13 277 (42 686) (53 666)
Financing activities 17 910 29 267 34 656
Taxation and dividends paid (60 393) (51 588) (94 542)
Financial services activities (75 348) (165 893) 264 581
Investing activities (3 774) (74 053) (292 601)
Net movement in cash and short-term
funds (108 328) (304 953) (141 572)
Opening cash and short-term funds 460 548 602 120 602 120
Closing cash and short-term funds 352 220 297 167 460 548
Segmental information
Corpcapital
Corpgro Corpcapital bank Group
Profit before taxation and
exceptional items 54 297 69 753 67 461 191 511
Taxation and exceptional items 14 652 19 609 12 969 47 230
Profit after taxation 39 645 50 144 54 492 144 281
Review
Headline earnings of R80 million and headline earnings per share of 31,8 cents
have increased by 22% reflecting a strong performance from the group's
financial service activities and solid contributions from its consolidated
subsidiaries which achieved a 23% increase. All of the growth was organic. The
results demonstrate the benefits of the strategy of operating as a seamless
integrated investment banking and financial services group.
Profit before taxation and exceptional items increased by 21 % to R191 million,
despite an increase of 57% in operating expenses caused by investment in new
divisions, infrastructure and enhanced human capital resources. Total
shareholders' equity increased to R1,3 billion. In addition to the increase in
the value of the group's on balance assets, assets under management and joint
management have risen to exceed R8 billion.
The group's activities comprise the following major divisions, Proprietary
investments, Corporate Finance, Private Equity Funds Management, Property Asset
Management and Finance, Treasury and Structured Products and Specialised
Finance.
A major achievement during the period was the progress in the implementation of
investment banking strategies for the Corpgro investment portfolio and the
integration and alignment of the portfolio management with the Corpcapital
proprietary investment management process.
The Group now possess exceptional advisory and management skills in the major
asset classes. Recent market research shows a sharp increase in brand
recognition and further improvement in the perception of the group amongst its
target market. The building of the brand is a continuing process.
The group continues to be able to attract and effectively utilise premier
intellectual capital due to its strong corporate culture and commitment to the
group's goals.
The group finds itself in the position where the current corporate structure
has served its purpose in the development of the group and the next logical
step is to restructure the 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
Corpgro has demonstrated its ability to consistently grow its earnings and
achieve well balanced income through diversification within the parameters of
its core competence. We remain confident that we will continue to deliver above
average returns to all of our stakeholders.
Dividend
Corpgro's dividend policy is to declare an annual dividend on publication of
audited year end results.
By order of the board
Nic Frangos Jeff Liebesman
Chairman Chief executive officer
27 March 2001
Directors: N Frangos (Chairman*) J Liebesman (Chief executive officer) E
Ellerine* E Grolman* B Liebmann* M Sacks*
(*non-executive)
Registered Office: 2 Arnold Road, Rosebank, Johannesburg Telephone: (2711)
283-0000 Fax: (2711) 283-0088 E-mail: info@corpgro.com Transfer Secretaries:
Mercantile Registrars Limited 11 Diagonal Street, Johannesburg 2001 (P O Box
1054, Johannesburg 2000)
These results can be viewed at: www.corpgro.com
