| Wed 6 Jun 2001, 0:00 | | The Laser Group Limited - Audited Results For The |
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March 2001
The Laser Group Limited
Registration Number 1971/010431/06
Audited results for the eighteen months ended 31 March 2001
HIGHLIGHTS
(Annualised for 12 months)
Turnover up 98%
Net profit from ordinary activities up 138%
Headline earnings per share up 90% to 70.8 cents
Net asset value per share up 46% to 367 cents
INCOME STATEMENT PRO FORMA ANNUALISED
R'000 R'000
twelve months twelve months
% ended 31 March ended 31 March
Increase 2001 2000
Turnover 321 842 178 032
- Turnover
continuing operations 98% 321 824 162 377
- Turnover
discontinued operations - 15 655
Net profit from
ordinary activities 138% 16 039 (41 661)
Headline earnings 18 250 9 500
Headline earnings
per share 90% 70,8 37,2
INCOME STATEMENT
Audited Audited
R'000 R'000
eighteen months twelve months
ended 31 March ended 30 Sept.
2001 1999
Turnover 475 055 334 422
- Continuing operations 475 055 178 767
- Discontinued operations 0 155 655
- Revenue 233 167 194 654
- Disbursements 241 888 139 768
Operating profit before
depreciation, amortisation,
interest and exceptional items 50 295 32 412
- Continuing operations 50 295 14 521
- Discontinued operations 0 17 891
Depreciation and amortisation (9 801) (7 610)
Interest (6 554) (10 061)
Operating profit before
exceptional items 33 940 14 741
Exceptional items (946) (59 592)
Profit/(loss) before tax and
associate income 32 994 (44 851)
Taxation (charge)/credit (8 167) 8 272
Net profit from ordinary activities 24 827 (36 579)
(Loss)/income from associate (392) 925
Net profit/(loss) from
ordinary activities 24 435 (35 654)
Headline earnings 23 669 16 248
Weighted average number of ordinary
shares in issue during the period 26 157 26 830
Earnings per share 93.4 (132.9)
Headline earnings
per share 90.5 60.6
Reconciliation between
earnings and headline earnings
Net profit/(loss) from
ordinary activities 24 435 (35 654)
Adjustments:
- (profit)/loss on disposal
of fixed assets and
investments (6 330) 968
- goodwill and trademark
amortisation 4 130 14 491
- restraint of trade 750 0
- Share Trust loan provision 946 0
- other capital items (262) 0
- property value adjusted 0 17 222
- loss on sale of business 0 18 732
- reorganisation expenses 0 489
Headline earnings 23 669 16 248
ABRIDGED BALANCE SHEET
Audited Audited
R'000 R'000
eighteen months twelve months
ended 31 March ended 30 Sept.
2001 1999
ASSETS
Non-current assets
Fixed assets
- property 61 314 62 795
- vehicles and equipment 31 663 26 854
- trademarks 8 912 9 840
- goodwill 22 406 37 704
Investment 5 089 29 465
Deferred taxation 1 947 7 873
Other assets 1 460 2 183
Total non-current assets 132 791 176 714
Current assets
Accounts receivable 54 814 46 252
Cash and cash equivalents 9 640 2 336
- Cash balances 23 844 10 862
- Cash overdraft (14 204) (8 526)
Total current assets 64 454 48 588
Total assets 197 245 225 302
EQUITY AND LIABILITIES
Capital and reserves
Shareholders' interest 95 953 105 131
Total capital and reserves 95 953 105 131
Non-current liabilities
Interest bearing long-term
liabilities: property 19 223 27 100
Interest bearing long-term
liabilities: other 4 321 4 581
Deferred vendor payments
at full value 13 687 19 992
Total non-current liabilities 37 231 51 673
Current liabilities
Interest bearing current
liabilities: properties 2 867 2 453
Interest bearing current
liabilities: other 3 465 4 401
Taxation 1 499 537
Other current liabilities 40 256 45 274
Deferred vendor payments
at full value 15 974 15 833
Total current liabilities 64 061 68 498
Total equity and liabilities 197 245 225 302
Net asset value per share (cents): 367 392
Net asset value per share
adjusting for goodwill
write off (cents): 367 251
Net tangible asset value per
share (cents): 247 215
Return on shareholders' equity 25% (34%)
Debt equity ratio 0.21 0.34
ABRIDGED CASH FLOW STATEMENT
Audited Audited
R'000 R'000
eighteen months twelve months
ended 31 March ended 30 Sept.
2001 1999
Cash generated by operations 43 834 32 998
Working capital changes (14 052) (30 362)
Net interest paid (3 482) (13 134)
Normal taxation paid (1 279) (381)
Net cash inflow/(outflow)
from operating activities 25 021 (10 879)
Net cash inflow from
investing activities 12 822 4 681
Net cash (outflow)/inflow
from financing activities (30 539) 13 755
Net increase in cash
and cash equivalents 7 304 7 557
Cash and cash equivalents
at the beginning of
the period 2 336 (5 221)
Cash and cash equivalents
at the end of the period 9 640 2 336
STATEMENT OF CHANGES IN ORDINARY SHAREHOLDERS' FUNDS
Audited Audited
R'000 R'000
eighteen months twelve months
ended 31 March ended 30 Sept.
2001 1999
Ordinary shareholders'
funds at the beginning
of the period 105 131 132 637
Share capital (147) 177
- Share buy back (147) 0
- Shares issued for cash 0 127
- Capitalisation issue 0 50
Share premium (40 140) 5 535
- Share buy back (2 436) 0
- Goodwill write-off (37 704) 0
- Shares issued for cash 0 5 585
- Capitalisation issue 0 (50)
Movement in non-
distributable reserve 456 (6 947)
- Acquisition of interest
in subsidiary 456 (1 557)
- Revaluation of properties 0 (1 599)
- Disposal of subsidiary's
assets 0 (3 791)
Increase/(decrease) in
retained income 23 979 (26 271)
Adjustment to goodwill
previously written off to
Share Premium 6 674 0
Ordinary shareholders'
funds at the end of the period 95 953 105 131
COMMENTARY
Overview
The Group achieved positive results which met the objectives set for the
period. The audited results for the eighteen months to 31 March 2001 are
noted above together with a pro forma annualised income statement for the
twelve month period then ended. Turnover from continuing operations has
doubled increasing the headline earnings per share by 90% to 70.8 cents in
the latest twelve month period.
Commercial Finance Company Limited (CFC), a listed investment holding
company, acquired a 34% stake in Laser during the period. The Laser
directors and CFC have entered into a voting pool agreement for 46% of the
issued share capital. CFC has endorsed the new strategy of creating an
integrated services group focused on high growth sectors. CFC will play an
active role in the Group's strategic development and will provide the
necessary financial resources to assist in achieving this vision.
Operational strategy and overview
Management are satisfied that the benefits of the Group's repositioning have
been successful and will continue in the years ahead.
Laser is intent on becoming a premier provider of outsourced support
services, providing high quality multi-service solutions through innovation,
technology and service excellence. Currently the Group's activities are
principally in logistics, supply chain management and human resources.
Laser Logistics Solutions
Laser Logistics Solutions is presently capitalising on the growing demand
for time sensitive express distribution and e-commerce fulfillment. The
operations have been consolidated into three business units, Laser
International Solutions (clearing and forwarding), Laser Express Solutions
(air and road based courier and delivery) and Laser Distribution Solutions
(third party distribution and warehousing). These businesses continue to
benefit from operational synergies and cross selling opportunities.
Laser Human Resource Solutions
Laser Human Resource Solutions offers businesses a single point of access to
a broad range of HR products and services. The Group's human performance
division provides consulting services supported by a range of integrated
tools and products. This offering is complemented by businesses focused in
executive placement and other specialised recruitment activities.
During this reporting period the Group has developed an internet portal,
virtuallyHR, hosted on a joint venture basis with I-Net Bridge, a Johnnic
Group company. The technology platform equips users with the capacity to
provide more efficient and effective HR services on an on-line, real time
basis.
Financial results
Comparisons with previous years should take into account the restructuring
of the Group as well as the change in the financial year-end.
Income statement and earnings per share
Net profit from ordinary activities for the twelve month period to 31 March
2001 was R16 million compared to a loss of R41,6 million in the previous
year to 31 March 2000. Headline earnings for the same period increased by
92% from R9,5 million to R18,25 million resulting in growth of 90% in
headline earnings per share to 70.8 cents.
Balance sheet
The balance sheet as at 31 March 2001 reflects the Group's continued focus
on cash management. The debt to equity ratio of 0.21 is well within
management's gearing objectives and has been achieved despite vendor
payments in the period of R18 million. Net cash resources of R9,6 million,
up from R2,3 million, reflect the cash generative nature of the Group's
activities.
The Group's net asset value at 31 March 2001 is 367 cents per share, up 46%
after adjusting for the goodwill write off referred to below.
Significant transactions
During the period, the Group sold its 20% investment in a joint venture with
a MGX Limited subsidiary for R37 million, resulting in a profit on sale of
R6,3 million.
During the period the company acquired a 35% interest in a technology
company which owns intellectual property rights and has a 50% share in
virtuallyHR.
On 1 March 2000 the Group acquired the assets and business of Goeie Hoop
Vervoer, an express road distribution business operating in the Western
Cape. The acquisition consideration amounts to a minimum of R16,8 million
and a maximum of R18,8 million based on warranted earnings.
On 1 October 2000 the Group acquired the assets and business of Project
Freight, a clearing and forwarding agency. The purchase consideration
amounts to a maximum of R4,9 million based on warranted earnings.
Post year-end transaction
On 1 April 2001 the Group acquired 100% of the issued share capital of
Gentia Software SA (Pty) Limited. The company distributes and implements,
under licence, enterprise performance management applications, including the
Gentia Balanced Scorecard methodology. The purchase consideration amounts to
R2,5 million based on warranted earnings.
Prospects
The alignment of the Group's service offerings with its stated vision of
becoming a leading business to business services company will assume even
greater importance during the year ahead. Innovative ways of taking the
Group's complete offering to its customers and clients will continue to be
sought and implemented.
The directors have endorsed management's strategic implementation plan and
are confident that this will enhance the Group's profile and capabilities in
the year ahead. This, coupled with the Group's intent to continually seek
ways of improving operating efficiencies and aggressive organic growth
targets will make a significant contribution to shareholder value.
The directors will continue to seek additional avenues to enhance
shareholder wealth through mergers and acquisitions.
Reduction of capital
The share premium was reduced by R37,7 million during the period due to the
write off of goodwill on acquisitions made before 30 September 1999. A share
buy back of 10% of the issued share capital was approved by members in
accordance with JSE regulations. To date the Group has purchased and
cancelled 5% of the capital.
Minority Offer
A circular setting out the terms of an offer to minorities of 190 cents per
share will be distributed to shareholders on receipt of Competition
Commission approval.
Dematerialisation of shares
The Laser Group moved to the Strate system during April 2001 as part of the
JSE's initiative towards an electronic settlement environment for share
transactions. Electronic trading commenced on 14 May 2001. Shareholders are
reminded that, should they wish to trade their Laser Group shares on the
JSE, they will be required to dematerialize those shares prior to trading.
Shareholders are advised to nominate a CSDP for this purpose, in the event
that they do not utilise their broker's CSDP.
Dividend Policy
In line with the Group's policy to preserve cash for additional growth
opportunities, no dividend has been declared in the period.
By order of the Board
Tony Williamson Michael Fuller
Non-executive Chairman Chief Executive Officer
6 June 2001
Registered Office Transfer Secretaries
21 Riebeeck Street Mercantile Registrars
Cape Town 11 Diagonal Street
8001 Johannesburg, 2001
These results can be viewed on the Internet at http://www.laser.co.za
