Ninian And Lester Holdings Limited (n&l) - Declara
NO. 55
SPECIAL DIVIDEND DISTRIBUTION
DECLARATION OF SPECIAL DIVIDEND NO. 55
Notice is hereby given that a special dividend of R 6,00 per share (the
special dividend) has been declared by the directors of Ninian and Lester
Holdings Limited. The last day to trade to participate in the dividend will
be Friday, 6 July, 2001. The shares will commence trading ex dividend on
Monday, 9 July, 2001 and the record date will be 13 July, 2001. Dividend
warrants/transfers will be posted/initiated on or about Monday, 16 July,
2001.
RATIONALE
The turnover of the group for the year ended 31 December, 2000 of R 325
million was almost the same as for the year ended 31 December, 1995.
However, margins have declined in recent years so that profit before
taxation was only R 10,3 million in 2000 compared with R 17,9 million in
1995 while capital and reserves during the same period increased from R 72
million to R 107 million.
A review by the board of the group's operations indicates that the volume of
business in the foreseeable future is likely to continue at the levels
achieved in 2000 while margins in the industry will continue under pressure,
notwithstanding the prospect of export business to the USA in terms of AGOA.
Accordingly, the directors have decided to reduce the capital employed by
way of a dividend out of revenue reserves to a level appropriate to the
anticipated turnover and the continuing low return on investment expected in
the current environment in which our group operates.
Shareholders are aware that N & L shares trade infrequently and at a price
substantially below book value and the directors are of the view that the
special dividend will unlock value for shareholders.
FINANCIAL IMPLICATIONS
The financial effects of the special dividend on the earnings per share
("EPS") and net asset value per share ("NAV") are set out in the table
below.
Before the
special dividend After the
special dividend Change
(cents) (cents) (%)
EPS 246 196 (20.3)
NAV 2 877 2 277 (20.9)
Notes:
The EPS and NAV "Before the special dividend" are based on the audited
financial statements for the year ended 31 December 2000.
The EPS and NAV "After the special dividend" are based on the assumption
that the dividend was paid on 1 January 2000. It is further assumed that the
aggregate dividend would have earned interest at 12% over this period, which
interest would have attracted income tax at a rate of 30%. This figure is
compared with the actual EPS for the same period.
In the light of the magnitude of the special dividend and its effect on the
company's capital structure, the board expects to be more conservative in
its dividend policy and dividend cover is likely to be higher than hitherto.
Results for the first half of this year are expected to be lower than those
achieved last year and profits for the year are likely to be less than those
achieved in the previous year.
In view of the special dividend your directors do not intend to declare an
interim dividend this year (2000 : 10 cents).
Transfer Secretaries: By Order of the Board
Mercantile Registrars Ltd. G W Rahmer, B. Com, M.B.L., C.A. (S.A.)
P O Box 1053 Secretary
JOHANNESBURG DURBAN
2000 4 June 2001
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