| Wed 9 May 2001, 0:00 | | Altron - Audited Consolidated Preliminary Financia |
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Allied Electronics Corporation Limited
(Incorporated in the Republic of South Africa)
(Registration number 1947/024583/06)
AUDITED CONSOLIDATED PRELIMINARY FINANCIAL RESULTS for the year ended 28
February 2001
Revenue up
29%
Headline earnings
per share up 19%
Operating income up 16%
Exports
at
R1 billion
innovation. technology. value.
Income statement
Year Year
% ended ended
Change 28.2.01 28.2.00
Figures in R000
Revenue 28.7 8 973 640 6 971 569
Operating income 16.1 627 300 540 227
Dividend income 22 077 41 179
Net interest income 59 891 81 434
Income from associates 10 529 14 730
Amortisation of goodwill (43 285) -
Exceptional items (note 1) 63 615 10 751
Income before taxation 7.5 740 127 688 321
Taxation 157 411 188 818
Income after taxation 582 716 499 503
Attributable to outside
shareholders (285 111) (244 088)
Attributable earnings 16.5 297 605 255 415
Basic earnings per share (cents) 103.3 88.9
Headline earnings per
share (cents) 19.2 101.5 85.2
Dividend per share (cents) 31.0 28.0
Weighted average number of shares
in issue (000)
- ordinary shares 96 984 96 878
- participating preference shares 191 150 190 563
Notes:
1. Exceptional items
Net surplus on sale of operations 32 834 (7 211)
Net surplus on disposal of investment 85 417 17 962
Impairment losses (49 500) -
Restructuring costs (5 136) -
63 615 10 751
2. Reconciliation between earnings
and headline earnings
Attributable earnings 297 605 255 415
Amortisation of goodwill 43 285 -
Exceptional items - gross (63 615) (10 751)
277 275 244 664
Tax effect of above adjustments (7 690) (2 163)
Outside shareholders' interest 23 013 2 323
Headline earnings 292 598 244 824
3. The group changed its accounting policies for land and buildings and
goodwill. Previous revaluations of land and buildings were reversed and
additional depreciation was provided in the year to February 2000. Effective
from 1 March 2000, goodwill is capitalised and amortised over its useful life.
Comparative figures have not been restated for this change. The accounting
policies and methods of computation adopted in this report are consistent with
statements of Generally Accepted Accounting Practice.
4. Diluted earnings per share and diluted headline earnings per share are not
materially different from basic earnings per share and headline earnings per
share respectively.
Operational contribution
Year Year
Headline % held at ended ended
earnings: 28.2.01 28.2.01 % 29.2.00 %
Figures
in R000
Altech 53.4 125 211 42.8 86 002 35.2
Powertech 59.2 76 436 26.1 73 185 29.7
Fintech 64.3 57 490 19.6 65 134 26.7
BTG 41.9 (6 287) (2.1) - -
Altron
Corporate 100.0 39 748 13.6 20 503 8.4
292 598 100.0 244 824 100.0
Revenue:
Altech 3 690 850 40.7 3 058 586 43.9
Powertech 3 351 581 38.1 2 451 019 35.1
Fintech 1 525 849 16.8 1 461 593 21.0
BTG 382 886 4.2 - -
Altron Corporate 22 474 0.2 371 -
8 973 640 100.0 6 971 569 100.0
Balance sheet
28.2.01 29.2.00
Figures in R000
Assets
Non-current assets 2 138 730 1 717 691
Fixed assets 672 391 542 442
Goodwill 256 344 -
Negative goodwill (24 137) -
Advances to rental finance customers 853 811 23 980
Investments and loans 300 811 511 317
Deferred taxation 79 510 39 952
Current assets 4 074 855 3 197 367
Inventories 1 124 716 1 120 323
Accounts receivable 1 868 238 1 234 352
Net cash and cash equivalents 1 081 901 842 692
Total assets 6 213 585 4 915 058
Equity and liabilities
Ordinary shareholders' interest 1 666 547 1 399 897
Outside shareholders' interest 1 472 610 1 300 053
Non-current liabilities 660 210 384 900
Deferred taxation 50 216 53 348
Current liabilities 2 364 002 1 776 860
Total equity and liabilities 6 213 585 4 915 058
Net asset value per share (cents) 583.4 486.2
Shares in issue at end of period (000)
- ordinary shares 96 997 96 973
- participating preference shares 189 043 190 926
Cash flow statement
Year Year
ended ended
28.2.01 29.2.00
Figures in R000
Operating activities 392 620 115 963
Cash generated by operations 765 417 615 071
Net investment income 167 482 120 373
Changes in working capital (149 246) (50 336)
Taxation paid (216 500) (328 928)
Cash available from operating
activities 567 153 356 180
Dividends paid, including to outside
shareholders (174 533) (240 217)
Investing activities (581 682) (623 638)
Financing activities 359 401 202 233
Cash acquired in acquisitions 68 871 1 925
Net funds generated/(utilised) 239 210 (303 517)
Statement of changes in equity
Year Year
ended ended
28.2.01 29.2.00
Figures in R000
Balance at start of period 1 430 636 1 510 439
Changes in accounting policies (26 753) (30 739)
1 403 883 1 479 700
New share issues movement 5 730 3 023
Change in equity as result of
subsidiary companies acquiring its
own shares (37 789) -
Attributable earnings 297 605 254 688
Dividends (88 711) (80 664)
Net gains and losses not recognised
in the income statement 85 829 (256 850)
Revaluation of property and investments - 26 986
Foreign currency translation 69 510 3 387
Goodwill on acquisition - (281 338)
Other movements 16 319 (5 885)
Balance at end of period 1 666 547 1 399 897
Message to our shareholders
As predicted the past year has seen significant transformation and
restructuring for the group together with a decisive step in its determination
to become a key global player in its chosen markets. For the first time export
sales exceeded R1 billion and the foundation was also laid for the group's
stated globalisation objectives through the acquisition of foreign-based
subsidiaries. Despite difficult trading conditions, the group achieved pleasing
results for the year ended 28 February 2001, with headline earnings per share
increasing by 19.2% from 85.2 cents to 101.5 cents.
Turnover improved by a significant 29% to a record R9.0 billion (2000: R7
billion) while operating income increased by 16.1% from R540 million to R627
million. Attributable earnings rose by 16.5% to R298 million from R255.4
million. This translated into earnings per share of 103.3 cents up from 88.9
cents.
The group continues to maintain a strong balance sheet and net cash resources
at year-end were some R1 billion (2000: R842,6 million). Net asset value per
share increased by 20% from 486.2 cents to 583.4 cents.
A number of stated objectives were achieved during the year by refocussing the
group, restructuring management and reducing the number of investor entry
points. Autopage was delisted and Ventron unbundled and likewise delisted. The
Telemetrix PLC investment was sold, several non-core businesses disposed of and
the offshore holding structure simplified. The assets of Fintech were sold to
the Bytes Technology Group ("BTG") at year-end to create a focussed IT vehicle
with critical mass and a projected turnover in excess of R2 billion, thus
resulting in Fintech now being a focussed financial service business. In
February 2001, a number of operational management changes were announced. Of
significance was the decision to split the role of Chairman and Chief
Executive. As a result, Mr Robert Venter was appointed Chief Executive Officer
of Altron whilst Dr Bill Venter remains as Chairman.
business activities
Altech
By focusing its business on the strategy of globalisation and TMT convergence
Altech has for the fifth successive year recorded excellent results as well as
substantial growth. Headline earnings per share rose from 153.3 cents to 223.1
cents, an increase of 45.5%. Turnover increased by 21% to R3.7 billion (2000:
R3 billion).
Autopage Cellular performed well, growing its base to more than 400 000
subscribers which allowed it to retain its position as southern Africa's
largest dual independent service provider. UEC Multi-Media, Altech's
multi-media operation, produced strong results and has now also expanded into
the cable and terrestrial multi-media markets. Arrow Altech Distribution,
having completed a restructure programme, is now performing according to plan,
with a strong order book and Alcatel Altech Telecoms continues to be a leader
in the South African telecommunications market with tenders pending totalling
more than R1.5 billion. Altech's IT Division comprising Isis, Keops Isis,
Altech Smart Card Technology and Africard recorded satisfactory results and all
the remaining companies produced good results.
Exports totalling R485 million continue to be a major strategic objective for
Altech and form part of its globalisation initiative. Several offshore
acquisitions are currently being evaluated. Altech envisages that despite
present uncertainties in the international TMT business climate, further real
growth and earnings will be achieved in the current financial year.
Powertech
Powertech significantly increased its turnover by 31% to R3,2 billion from R2.5
billion and reported a headline earnings increase of 3.4% from 46.6 cents to
48.4 cents in the previous year. This underscores the upturn experienced by the
building and construction industries, the mining sector and the growth in GDFI.
Foreign revenues totalled R906 million with exports reaching a record R609
million.
As announced at the interim stage, Powertech acquired Cables de Comunicaciones
Zaragoza SL, Spain, the leading Spanish metallic telecommunication and data
cable manufacturer. This has further strengthened Powertech's globalisation
initiatives. Powertech's transformer business, ABB Powertech Transformers,
again exceeded all expectations and recorded another exceptional good year of
which export sales accounted for 70% of this company's turnover. The remainder
of Powertech's power electronics business reported satisfactory results and
several companies in the Telecommunications Division was successful in
receiving accreditation with a host of international telecommunication
companies. This placed Powertech in a favourable position to secure profitable
export orders which offset the shortfall in local demand for certain products.
Corning, the world's largest producer of fibre optic cables and products
concluded an important alliance with Powertech.
The loss making luminaire business was disposed of during the year under
review. Powertech expects that the deregulation and liberalisation in the power
electronic and telecommunications markets will provide further opportunities
for broadening its customer base and so reducing its erstwhile dependency on
individual customers. Powertech is well positioned to produce real growth in
the year ahead.
Fintech
Fintech successfully completed its restructuring programme, through the sale to
BTG of its ITand ITrelated interests, comprising Xerox South Africa, National
Data Systems and Alcatel Business Systems, and is now a fully focussed
financial services company. The remaining non-core businesses were sold.
Fintech, as reconstituted, achieved solid growth and reported an increase in
proforma headline earnings per share of 13.5% from 32.5 cents to 36.9 cents.
Capital financed by Fintech increased by 36% from R624 million to R846 million.
Both growth in capital financed and earnings per share is expected from Fintech
in the current financial year.
BTG
BTG recorded disappointing results reporting a headline loss per share of 5.2
cents for the year. A comprehensive restructuring programme was implemented
during the year, which involved recapitalisation of the company together with a
rationalisation exercise. A significant improvement was recorded in the second
six months where a headline loss of R15 million was recorded compared to R56
million headline loss in the first six months of the year under review. As
previously stated above, BTG acquired certain Fintech IT and IT related assets
to create a focussed IT vehicle with critical mass and a projected turnover in
excess of R2 billion. Prospects for the current year indicate that BTG will
henceforth be cash producing and should also earn profits.
REPURCHASE OF SHARES
During the period under review, the group under a general authority from
shareholders, repurchased 1 845 162 Altron participating preference shares at
an average price of R7,46 per share and 1 262 100 Altron ordinary shares at
R7,80 per share. This represents 0.96% of the issued participating preference
shares and 1.3% of the issued ordinary shares respectively.
OUTLOOK
Current developments with the second telecom network operator, the
restructuring of the electricity distribution industry, and the appointment of
the third cellular license operator augurs well for the group. The group's
growing global capability is expected to create new market opportunities
facilitating increased revenues and earnings. In the year ahead, the group will
continue with its stated objectives in reviewing its structure and streamlining
its business. Improved market conditions in the domestic economy coupled with
success in our export and globalisation thrust will generate earnings growth in
the current financial year.
DIVIDENDS
Notice is hereby given that the following dividends have been declared in
respect of the year ended 28 February 2001:
- Ordinary dividend No. 53 of 31 cents per share (2000: 28 cents); and
- Participating preference dividend No. 7 of 31 cents per share (2000: 28
cents).
The above dividends are payable on or about Friday 6 July 2001 to ordinary and
participating preference shareholders registered in the books of the company on
Friday 25 May 2001.
Annual report
The annual report of Altron for the year ended 28 February 2001 will be posted
to shareholders at the end of May 2001.
STRATE
Shareholders are advised that the company's share capital will be transferred
to the electronic STRATE environment as of Tuesday 17 July 2001. Shareholders
that are not already participating on the STAR programme, are advised to
consult with their banker, financial advisor or stockbroker concerning the
dematerialisation of their shares in the company.
On behalf of the board
Dr Bill Venter Robert Venter Gavin Rochussen
Chairman Chief Financial Officer Chief Executive
09 May 2001
Directors: Dr WP Venter (Chairman), RE Venter (Chief Executive), IMAyob, MC
Berzack, L Boyd, PMO Curle* (Alternate: GJ Trollope), DA Hawton, F
Mabuza-Suttle, PD Redshaw*, GM Rochussen,
Dr HA Serebro (Alternate: Adv. DC Mpofu), CG Venter, PLWilmot British*
Secretaries: Altron Management Services (Pty)Limited:Ms SF Linford (Group
Secretary)
This preliminary report is also available on the Internet at www.altron.co.za
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