| Tue 31 Aug 2010, 9:22 | | CMG - Cenmag Holdings Limited - Audited results for the year ended 28 February |
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CMG
CMG
CMG - Cenmag Holdings Limited - Audited results for the year ended 28 February
2010 and notice of Annual General Meeting
CENMAG HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1987/004821/06)
Share code: CMG ISIN code: ZAE000001533
(`Cenmag" or `the company`)
AUDITED RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2010 AND NOTICE OF ANNUAL
GENERAL MEETING
AUDITED RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2010
Shareholders are advised that the audited financial results for the year ended
28 February 2010 contain minor amendments to the reviewed results announcement
released on SENS on 1 June 2010. The amendments include a reclassification in
both the prior year and the reviewed financials which relates to production
overheads transferred from operating expenses to costs of sales. The
reclassification has had no impact on profits or earnings per share.
The audited results are set out below:
STATEMENTS OF FINANCIAL POSITION Audited Audited
28 February 29 February
2010 2009
R`000 R`000
ASSETS
Non-current assets 7 633 7 142
Fixed assets 7 405 7 029
Deferred tax 228 113
Current assets 13 585 16 041
Total assets 21 218 23 183
EQUITY AND LIABILITIES
Capital and reserves 16 298 13 757
Non Controlling Interest 482 452
Interest bearing liabilities - long and short term --- 2 536
Interest free liabilities 4 438 6 438
Total equity and liabilities 21 218 23 183
Number of shares in issue (000`s) 9 600 9 600
Net asset value per share information
Net asset value per share (cents) 170 143
Net tangible asset value per share (cents) 170 143
STATEMENTS OF COMPREHENSIVE INCOME Audited year Audited year
ended ended
28 February 29 February
2010 2009
R`000 R`000
Gross Revenue 34 615 36 286
Cost of sales 23 944 25 523
Gross profit 10 671 10 763
Operating costs 8 268 5 314
Operating profit 2 403 5 449
Net finance income 826 431
Profit before tax 3 229 5 880
Taxation (658) (1 693)
Profit after tax 2 571 4 187
Minority interest 30 30
Profit attributable to shareholders 2 541 4 157
Headline earnings 2 541 4 157
Earnings per share information
Number of shares in issue (000`s) 9 600 9 600
Attributable earnings per 26.47 43.30
ordinary share (cents)
Headline earnings per share (cents) 26.47 43.48
ABRIDGED STATEMENTS OF CASH FLOWS Audited Audited
28 February 29 February
2010 2009
R`000 R`000
Cash flows from operating activities 2 440 4 840
Cash flows from investing activities (758) (3)
Cash effects of financing activities (2 309) (377)
Net (decrease)/increase in cash and (627) 4 460
cash equivalents
Bank at beginning of year 8 893 4 433
Cash at the end of period 8 266 8 893
SEGMENTAL REPORTING Audited Audited year
year ended ended
28 February 29 February
2010 2009
R`000 R`000
Revenue
Manufacturing and Service 13 864 16 510
Wholesaling 20 751 19 776
Total 34 751 36 286
Profit from operating activities
Manufacturing and Service 1 744 5 148
Wholesaling 659 301
Total 2 403 5 449
GROUP STATEMENTS OF Share Share Retained Total
CHANGES IN EQUITY capital premium income
R`000 R`000 R`000 R`000
Balance at 01 March 2008 96 2 090 7 414 9 600
Net profit for the year -- -- 4 157 4 157
Balance at 29 February 2009 96 2 090 11 571 13 757
Net profit for the year -- -- 2 541 2 541
Balance at 28 February 2010 96 2 090 14 112 16 298
COMMENTARY
RESULTS
The board presents its audited results for the year ended 28 February 2010 in
accordance with IAS 34: Interim Financial Reporting. The company is an
investment holding company and its subsidiaries are primarily involved in the
manufacture and servicing of electromagnets and motor rewinding and the
wholesaling of electrical and related equipment.
BUSINESS OVERVIEW
In line with prevailing economic conditions, the group experienced a 4.6%
decline in revenue. Group headline earnings per share fell from 43.48 to 26.47
cents earnings per share. The company has not appointed an audit committee for
the year in terms of section 269A(1) of the Companies Act nor has it adhered
to certain listing requirements relating to corporate governance. The company
has undertaken to the JSE Limited that should the transactions referred to in
"Subsequent Events and Future Prospects" below not be implemented for any
reason whatsoever, the current board will ensure that the failure to appoint
an audit committee and comply with the Listings Requirements will be
rectified.
SUBSEQUENT EVENTS AND FUTURE PROSPECTS
Shareholders are referred to the SENS cautionary announcement dated 14 May
2010 and are advised that the company has entered into various agreements,
dated 11 May 2010, which, when taken together will result in:
a) the company repurchasing 35.53% of its issued share capital; and
b) the company disposing of its existing subsidiaries
As a result of the above transactions the company will become a cash shell.
ACCOUNTING POLICIES AND REVIEW
The financial results have been prepared in accordance with accounting
policies that comply with International Financial Reporting Standards ("IFRS")
and the Companies Act of 1973. The accounting policies and methods of
measurement and recognition are consistent with those applied in the previous
financial period. The results have been audited by Horwath Leveton Boner,
whose modified report is available for inspection at the registered office of
the company. The modification relates to the company`s failure to appoint an
audit committee and to comply with certain listing requirements and is set out
below:
* "In accordance with our responsibilities in terms of Section 45 of the
Auditing Profession Act No. 26 of 2005, we identified a recurring
reportable irregularity in that the company has not complied with Section
269A(1) of the Companies Act, which is an obligation to appoint an audit
committee.
* In addition, the JSE Ltd have found that Cenmag Holdings Limited and its
directors have contravened paragraph 3.84 of the Listing Requirements in
that Cenmag Holdings Limited:
1) Has no audit committee.
2) No separate chairman and chief executive officer.
3) No full time financial director as the financial director is also the
chief executive officer.
4) No independent directors and has no director that is capable of
fulfilling the role of the lead independent director
5) No remuneration committee.
This constitutes a reportable irregularity in terms of the Auditing
Professional Act and we reported such matters to the Independent Regulatory
Board for Auditors."
DIRECTORS
Shareholders attention is drawn to the fact that Mr Victor Farkas fulfils the
roles of Chairperson, Chief Executive Officer, Financial Director and
Secretary of the Company, which is a contravention of the corporate governance
requirements of the JSE Listings Requirements. The Company is aware of this
contravention and has justified it based on the size of the company, that Mr
Farkas has the necessary skills and experience and that it represents a cost
saving to the Company.
Mr JJ Farkas was appointed to the board with effect from 16 September 2009 in
order to fill the casual vacancy that had arisen as a result of Ms I Mazibuko
not being re-elected as a director at the Annual General Meeting of the
company held on 7 September 2009.
GENERAL
1. No new shares were issued and no special resolutions were passed during
the period under review.
2. No dividends were recommended or declared for the period.
POSTING OF ANNUAL REPORT AND NOTICE OF GENERAL MEETING
Shareholders are advised that the annual report incorporating the audited
annual financial statements for the year ended 28 February 2010 will be posted
to shareholders on 31 August 2010.
Notice is hereby given that the annual general meeting of ordinary
shareholders will be held at 3 Sandown Valley Crescent, Sandown at 09:30 on
Tuesday, 30 November 2010, to transact the business as stated in the notice of
annual general meeting forming part of the annual report.
Johannesburg
31 August 2010
Company Secretary Registered Office
V. Farkas M. Econ C.A. (S.A.) 30 Bisset Road, Jet Park, Boksburg
PO Box 870, Isando, 1600 PO Box 870, Isando, 1600
Directors
V.Farkas (CEO), C.J.B. Le Roux (Executive director), J.J. Farkas (Executive
director), E.M. Greenblatt (Non-executive director)
Sponsor Transfer Office
Arcay Moela Sponsors Computershare Investor Services (Proprietary)
(Proprietary) Limited Limited
Date: 31/08/2010 09:22:01 Produced by the JSE SENS Department.
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