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AEG 201402250001A
Unaudited Group results for the six months ended 31 December 2013
AVENG LIMITED
(“Aveng”, “the Company”, “the Group” or “Aveng Group”)
(Incorporated in the Republic of South Africa)
(Registration number: 1944/018119/06)
ISIN: ZAE000111829
Share code: AEG
Unaudited Group results for the
six months ended 31 December 2013
Key features
- Revenue
improved by 11% to R27,6 billion (2012: R24,9 billion)
- 18% increase
in the Mining two-year order book from June 2013
- Net operating earnings
down by 8% to R503 million (2012: R544 million)
- 22% increase in the Construction and Engineering:
South Africa and Rest of Africa two-year order book from June 2013
- Net cash position
stable at R2,4 billion
- Headline earnings per share
decreased by 21% to 82,1 cents (2012: 104,5 cents)
- Net finance expenses
R83 million (2012: net finance earnings R12 million)
Interim condensed consolidated statement of financial position
as at 31 December 2013
31 December 31 December 30 June
2013 2012* 2013
(Unaudited) (Unaudited) (Audited)
Note Rm Rm Rm
ASSETS
Non-current assets
Investment property 7 71 - 71
Property, plant and equipment 7 6 864 6 812 6 789
Goodwill arising on consolidation 1 443 1 400 1 425
Intangible assets** 7 222 163 184
Equity-accounted investments 219 91 144
Available-for-sale investments 72 147 70
Deferred tax assets 1 379 1 011 1 347
10 270 9 624 10 030
Current assets
Inventories 2 903 2 625 2 780
Trade and other receivables 2 920 1 858 2 655
Amounts due from contract customers 8 10 387 9 258 10 397
Cash and bank balances 6 5 619 5 263 4 551
21 829 19 004 20 383
TOTAL ASSETS 32 099 28 628 30 413
EQUITY AND LIABILITIES
Equity
Share capital and share premium 1 388 1 435 1 388
Other reserves 996 767 802
Retained earnings 11 411 11 017 11 103
Equity attributable to equity-holders of the parent 13 795 13 219 13 293
Non-controlling interests 10 13 12
13 805 13 232 13 305
Liabilities
Non-current liabilities
Borrowings and other liabilities 1 738 1 289 1 312
Deferred tax liabilities 385 255 319
Provisions 9 1 166 1 091 1 105
3 289 2 635 2 736
Current liabilities
Borrowings and other liabilities 830 161 219
Taxation payable 181 161 210
Trade and other payables 9 405 7 083 9 052
Provisions 9 1 552 1 183 1 924
Amounts due to contract customers 8 2 352 3 665 2 367
Bank overdrafts 6 685 508 600
15 005 12 761 14 372
TOTAL LIABILITIES 18 294 15 396 17 108
TOTAL EQUITY AND LIABILITIES 32 099 28 628 30 413
* Comparatives have been amended, as detailed in the Change in disclosure note, refer to note 3.
** Includes computer software and intangible assets with indefinite useful lives.
Interim condensed consolidated statement of comprehensive earnings for the six months ended 31
December 2013
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2013 2012* % 2013
(Unaudited) (Unaudited) change (Audited)
Note Rm Rm Rm
Revenue 27 654 24 987 11 51 704
Cost of sales 1 (25 681) (22 852) 12 (48 233)
Gross earnings 1 973 2 135 (8) 3 471
Operating expenses 2 (1 551) (1 619) (4) (2 844)
Operating earnings before other gains and losses 422 516 (18) 627
Other gains and losses 3 2 50 -
Operating earnings after other gains and losses 425 518 (18) 627
Earnings from available-for-sale investments 34 42 (19) 41
Share of earnings / (losses) from equity-accounted investments 44 (16) (12)
Net operating earnings 503 544 (8) 656
Finance earnings 57 66 (14) 132
Finance and transaction expenses (140) (54) 159 (162)
Earnings before taxation 420 556 (24) 626
Taxation 5 (113) (159) (29) (167)
Earnings for the period 307 397 (23) 459
Items that may be subsequently recycled to earnings:
Exchange differences on translating foreign operations 192 164 17 196
Movement in insurance and other reserves 1 ** (2)
Other comprehensive earnings for the period 193 164 18 194
Total comprehensive earnings for the period 500 561 (11) 653
* Comparatives have been amended, as detailed in the Change in disclosure note, refer to note 3.
** Amounts less than R1 million.
1 Cost of sales includes depreciation of R508 million (2012: R602 million).
2 Operating expenses includes depreciation of R56 million (2012: R60 million) and amortisation of R20 million (2012: R24 million).
The total depreciation, amortisation and impairment expense included in the statement of comprehensive earnings amounts to R584 million (2012: R686 million).
Interim condensed consolidated statement of comprehensive earnings for the six months ended 31
December 2013 (continued)
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2013 2012 % 2013
(Unaudited) (Unaudited) change (Audited)
Rm Rm Rm
Earnings for the period attributable to:
Equity-holders of the parent 308 394 (22) 466
Non-controlling interests (1) 3 (7)
307 397 (23) 459
Other comprehensive earnings
for the period attributable to:
Equity-holders of the parent 193 167 16 193
Non-controlling interests - (3) 1
193 164 18 194
Total comprehensive earnings for the period attributable to:
Equity-holders of the parent 501 561 (11) 659
Non-controlling interests (1) * (6)
500 561 (11) 653
Determination of headline earnings for the period:
Earnings for the period attributable to 308 394 (22) 466
equity-holders of the parent
Adjusted for (net of tax):
Profit on sale of property, plant and equipment (1) (2) (50) (1)
Impairment of property, plant and equipment - - 1
Headline earnings 307 392 (22) 466
Results per share (cents)
Earnings 82,4 105,0 (22) 124,6
Headline earnings 82,1 104,5 (21) 124,6
Diluted earnings 76,6 98,0 (22) 115,9
Diluted headline earnings 76,3 97,5 (22) 115,9
Dividend - - -
Number of shares (millions)
In issue 389,8 389,8 389,8
Weighted average 373,9 375,2 373,9
Diluted weighted average 402,1 402,1 402,1
*Amounts less than R1 million.
Interim condensed consolidated statement of cash flows
for the six months ended 31 December 2013
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2013 2012* 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
Cash retained from operating activities
Cash retained from operations 425 518 627
Depreciation and impairment 564 662 1 181
Amortisation 20 24 50
Non-cash items and other movements (455) 55 540
Cash generated by operations 554 1 259 2 398
Changes in working capital
Increase in inventories (123) (158) (313)
Increase in trade and other receivables and amounts due
from contract customers (255) (1 191) (3 127)
Increase in trade and other payables and amounts due
to contract customers 338 587 1 256
Cash generated by operating activities 514 497 214
Finance earnings 57 59 126
Finance and transaction expenses paid (140) (58) (164)
Taxation paid (107) (302) (464)
Cash inflow / (outflow) from operating activities 324 196 (288)
Investing activities
Property, plant and equipment purchased (271) (222) (459)
- expansion
- replacement (320) (560) (925)
Acquisition of investment property - - (71)
Acquisition of intangible assets (58) - (29)
Changes in equity-accounted and available-for-sale
investments (31) (2) (38)
Proceeds from sale of property, plant and equipment 144 25 165
Proceeds from sale of intangible assets - - 2
Cash outflow on acquisition of subsidiary - - (9)
Proceeds from sale of available-for-sale investment - - 80
Dividend earnings 34 42 41
Cash outflow from investing activities (502) (717) (1 243)
Operating free cash outflow (178) (521) (1 531)
Financing activities with equity-holders
Shares repurchased - - (47)
Dividends paid - (242) (242)
Financing activities with debt holders
Proceeds from borrowings (net of loans advanced) 1 037 523 603
Net increase / (decrease) in cash and cash equivalents
before foreign exchange movements on cash 859 (240) (1 217)
Foreign exchange movements on cash 124 135 308
Cash and cash equivalents at beginning of year** 3 951 4 860 4 860
Cash and cash equivalents at end of year** 4 934 4 755 3 951
Borrowings, excluding bank overdrafts 2 568 1 450 1 531
Net cash position 2 366 3 305 2 420
* Comparatives have been amended, due to the changes detailed in note 3.
** Cash and cash equivalents is calculated by deducting Bank overdrafts from Cash and bank balances.
Notes to the interim condensed consolidated financial statements
1. Corporate information
The interim condensed consolidated financial statements of the Group for the six months ended
31 December 2013 (“interim results”) were authorised for issue in accordance with a resolution
of the directors on 19 February 2014.
Aveng Limited is a limited liability company incorporated and domiciled in the Republic of South
Africa whose shares are publicly traded. The Group operates in the construction, engineering and
mining environment and as a result the revenue is not seasonal in nature, but is influenced by
the nature and execution of the contracts currently in progress. Refer to the commentary below
for a more detailed report on the performance of the different operating segments within the Group.
2. Basis of preparation and accounting policy
The interim results have been prepared on the historical cost basis, except for certain financial
assets which are measured at fair value.
The accounting policies used in the preparation of these results are consistent in all material
respects with those used in the Group’s audited annual financial statements as at 30 June 2013.
The interim financial statements have been prepared in accordance with IAS 34 Interim Financial
Statements and the Listings Requirements of the JSE Limited. The accounting policies adopted are
consistent with those of the previous year, except for the adoption of new and revised Standards
and Interpretations that become effective during this reporting period. The external auditors have
not reviewed the financial results for the six months ended 31 December 2013.
The interim results do not include all the information and disclosures required in the annual
financial statements, and should be read in conjunction with the Group’s audited annual financial
statements as at 30 June 2013.
The interim financial results have been prepared under the supervision of the acting Group
Financial Director, Mr HJ Verster.
The Group has adopted the following new and revised Standards and Interpretations (issued by the
International Financial Reporting Interpretation Committee) of the IASB that became effective on
or after 1 July 2013.
Standards
IFRS 7 Financial Instruments: Disclosure (Amendment)
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interests in Other Entities
IFRS 13 Fair Value Measurements
IAS 16 Property, Plant and Equipment (Improvement)
IAS 19 Employee Benefits (Revised)
IAS 27 Separate Financial Statements (Revised)
IAS 28 Investment in Associates and Joint Ventures (Revised)
IAS 34 Interim Reporting (Improvement)
The adoption of these Standards and Interpretations did not have a material effect on the
Group’s interim results and related disclosures.
In addition, the following Standards and Interpretations have been issued but are not yet effective.
Standard Subject Effective date
IFRS 9 Financial Instruments 1 January 2015
IFRS 10 Consolidated Financial Statements: Amendments for investment entities 1 January 2014
IFRS 12 Disclosure of Interests in Other Entities: Amendments for investment entities 1 January 2014
IAS 19 Employee Benefits (Amendment) 1 July 2014
IAS 27 Separate Financial Statements: Amendments for investment entities 1 January 2014
IAS 32 Financial Instruments: Presentation (Amendment) 1 January 2014
IAS 36 Impairment of Assets (Amendment) 1 January 2014
IAS 39 Financial Instruments: Recognition and Measurement (Amendment) 1 January 2014
The Group does not intend to early adopt any of the above Standards and Interpretations.
Contracting revenue
The Group uses the percentage-of-completion, surveys of work performed and completion of a
physical proportion of the contract work methods in accounting for its construction contracts. Use of these
methods requires the Group to estimate the construction services and activities performed to date
as a proportion of the total services and activities to be performed and apply judgment on the
contract progress and outstanding risks.
3. Change in disclosure
Background
As part of the Group’s financial reporting improvement initiatives, the structure, format and
presentation of disclosures in the interim condensed consolidated financial statements were reviewed.
This resulted in the reallocation of certain comparative amounts as well as the introduction of
certain changes in terminology.
The initiative is an ongoing programme targeting the most appropriate disclosure and presentation
practices, to best serve the interests of the Group’s stakeholders.
The resulting reallocations had no earnings or loss impact on the interim condensed consolidated
financial statements, and as such the reallocations are not regarded as having had a quantitatively
nor qualitatively material effect on the information presented.
Reallocations affecting the 2012 comparatives:
The reallocations for the 2012 comparative amounts are as follows:
Interim condensed consolidated statement of financial position
An amount of R77 million gross carrying amount and R67 million accumulated depreciation (net
carrying amount R10 million), relating to computer software was reallocated from property, plant and
equipment to intangible assets.
Goodwill amounting to R1 400 million in 2012 was reallocated from “Goodwill and other intangible
assets” to a separately disclosed line item, “Goodwill arising on consolidation”.
Amounts due from contract customers of R9 258 million in 2012 was reallocated from “Trade and
other receivables” to a separately disclosed line item, “Amounts due from contract customers”.
An amount of R3 665 million in 2012 was reallocated from “Trade and other payables” to a
separately disclosed line item, “Amounts due to contract customers”.
The 31 December 2012 comparative information was not recorded to the same granular level as was
recorded for the six months ended 31 December 2013 and for the year ended 30 June 2013, and therefore
may not be in a manner consistent with management’s current categorisation practice, which in turn is
based upon judgemental interpretations on a contract-by-contract and case-by-case basis. The exclusion
of the disclosure of this information, for the six months ended 31 December 2012 does not have a
quantitatively nor qualitatively material effect on the Group's interim results.
Other provisions of R234 million in 2012 were reallocated from “Accruals” (part of Trade and other
payables) to the separately disclosed line item “Provisions”. Furthermore, the “Provisions” line
item was reclassified to reflect the current and non-current portions of provisions raised.
Interim condensed consolidated statement of comprehensive earnings
The Group now includes the disclosure of “Cost of sales” and “Gross earnings” on the interim
condensed consolidated statement of comprehensive earnings. This disclosure was not previously included
in the interim report and resulted in the disclosure of R22 852 million relating to cost of sales and
R2 135 million relating to gross earnings.
Depreciation of R602 million directly attributable to cost of sales was previously disclosed as
part of the “Depreciation” line item for 2012. This was reallocated to “Cost of sales”.
Depreciation of R60 million previously disclosed as part of the “Depreciation” line item for 2012.
This was reallocated to “Operating expenses”.
Amortisation of R24 million previously disclosed as part of the “Amortisation” line item for 2012.
This was reallocated to “Operating expenses”.
Notes to the interim condensed financial statements
The disclosure in the segment report, note 4, has been extensively expanded, including the
disclosure of total revenue (being internal and external revenue) per operating segment and the separate
disclosure of the elimination of internal revenue, resulting in total external revenue for the Group.
Refer to note 4.
Terminology changes
Statement of financial position
New terminology used Previously used terminology
Retained earnings Distributable reserves
Borrowings and other liabilities Borrowings
Statement of comprehensive earnings
New terminology used Previously used terminology
Earnings Profit/income
Finance earnings Finance income
Finance and transaction expenses Finance and transaction costs
Statement of changes in equity
New terminology used Previously used terminology
Retained earnings Distributable reserves
Earnings Profit/income
Statement of cash flows
New terminology used Previously used terminology
Finance earnings Finance income
Finance and transaction expenses Finance and transaction costs
4. Segment information
The Group has determined four reportable segments that are largely organised and managed
separately according to the nature of products and services provided.
These operating segments are components of the Group:
a) that engage in business activities from which they earn revenues and incur expenses; and
b) whose operating results are regularly reviewed by the Group’s chief operating decision makers
to make decisions about resources to be allocated to the segments and assess their performance.
Segment assets exclude Goodwill arising on consolidation, Intangible assets, Equity-accounted
investments, Available-for-sale investments, Deferred tax assets and Cash and bank balances.
Segment liabilities exclude Borrowings and other liabilities, Deferred tax liabilities, Taxation
payable and Bank overdrafts.
The Group’s operating segments for the year are categoried as follows:
1. Construction and Engineering
1.1 Construction and Engineering: South Africa and Rest of Africa
This operating segment comprises Aveng Grinaker-LTA and Aveng Engineering.
1.2 Construction and Engineering: Australasia and Asia*
This operating segment comprises McConnell Dowell.
2. Mining
This operating segment comprises Aveng Moolmans and Aveng Mining Shafts & Underground.
3. Manufacturing and processing
This operating segment comprises Aveng Manufacturing and Aveng Steel.
4. Administration and Eliminations
This operating segment comprises concessions, corporate services, corporate-held investments including
properties, and consolidation eliminations.
* The Construction and Engineering: Australasia and Pacific operating segment has been renamed
to Construction and Engineering: Australasia and Asia.
4. Segment information (continued)
Construction and
Engineering: Manu- Adminis-
South Africa facturing tration
December 2013 and the Rest Australasia and and
Rm of Africa* and Asia Mining Processing* Eliminations Total
External revenue 4 104 14 933 3 459 5 026 132 27 654
Internal revenue 53 - 2 239 (294) -
Gross revenue 4 157 14 933 3 461 5 265 (162) 27 654
Operating (loss) / earnings before
other gains and losses (336) 165 295 162 136 422
Other gains and losses - - - - 3 3
Operating (loss) / earnings after
other gains and losses (336) 165 295 162 139 425
Earnings from available-for-sale
investments 1 - - - 33 34
Share of earnings / (losses) from
equity-accounted investments 1 26 - - 17 44
Net operating (loss) / earnings (334) 191 295 162 189 503
Net finance (expense) / earnings
(finance earnings less finance
and transaction expenses) (12) (34) (15) 2 (24) (83)
(Loss) / earnings before taxation (346) 157 280 164 165 420
Taxation 102 (45) (95) (52) (23) (113)
(Loss) / earnings for the period (244) 112 185 112 142 307
Investments** 9 135 4 - 143 291
Segment assets (note 1) 3 157 8 348 4 230 5 906 1 504 23 145
Segment liabilities (note 2) 2 470 7 489 1 801 1 905 810 14 475
Capital expenditure*** 57 151 197 124 120 649
Depreciation and impairment 46 203 231 73 11 564
Amortisation 7 - - 6 7 20
* Aveng Steel Fabrication (“ASF”), Aveng Manufacturing Automation & Control Solutions (“A&CS”) and Aveng Manufacturing
Facades business units are now reported under the Manufacturing and Processing segment, compared to the Construction and
Engineering: South Africa and Rest of Africa segment in the prior year. Comparatives have been adjusted.
** Consists of equity-accounted investments and available-for-sale investments.
***Segment capital expenditure includes intangible asset expenditure of R58 million.
Construction and
Engineering: Manu- Adminis-
South Africa facturing tration
December 2012 (Unaudited) and the Rest Australasia and and
Rm of Africa* and Asia Mining Processing* Eliminations** Total
External revenue 3 650 12 761 3 793 4 781 2 24 987
Internal revenue 93 - - 172 (265) -
Gross revenue 3 743 12 761 3 793 4 953 (263) 24 987
Operating (loss) / earnings
before other gains and losses (40) 195 390 76 (105) 516
Other gains and losses (14) - - - 16 2
Operating (loss) / earnings
after other gains and losses (54) 195 390 76 (89) 518
Earnings from available-for-sale
investments 1 - - - 41 42
Share of earnings / (losses) from
equity-accounted investments (17) - - - 1 (16)
Net operating (loss) / earnings (70) 195 390 76 (47) 544
Net finance earnings / (expenses)
(finance earnings less finance
and transaction expenses) 12 (2) (12) 8 6 12
(Loss) / earnings before taxation (58) 193 378 84 (41) 556
Taxation 17 (53) (121) (22) 20 (159)
(Loss) / earnings for the period (41) 140 257 62 (21) 397
Investments 66 138 1 - 33 238
Segment assets (note 1) 3 082 6 759 4 579 5 604 529 20 553
Segment liabilities (note 2) 2 298 6 825 2 033 1 289 577 13 022
Capital expenditure 5 181 453 142 1 782
Depreciation and impairment 49 210 321 73 9 662
Amortisation 5 - - 5 14 24
* Aveng Steel Fabrication (“ASF”), Aveng Manufacturing Automation & Control Solutions (“A&CS”) and Aveng Manufacturing
Facades business units are now reported under the Manufacturing and Processing segment, compared to the Construction
and Engineering: South Africa and Rest of Africa segment in the prior year. Comparatives have been adjusted.
** Comparatives have been adjusted as concessions is reported under the Administration and Eliminations operating segment,
compared to the Construction and Engineering: South Africa and rest of Africa segment in the 2012 year. Comparatives have
been adjusted.
*** Consists of equity-accounted investments and available-for-sale investments.
Construction and
Engineering: Manu- Adminis-
South Africa facturing tration
June 2013 (Audited) and the Rest Australasia and and
Rm of Africa* and Asia Mining Processing* Eliminations Total
External revenue 7 239 26 749 7 435 10 146 135 51 704
Internal revenue 219 - - 409 (628) -
Gross revenue 7 458 26 749 7 435 10 555 (493) 51 704
Operating (loss) / earnings
before other gains and losses (895) 644 707 235 (64) 627
Other gains and losses - - - - - -
Operating (loss) / earnings
after other gains and losses (895) 644 707 235 (64) 627
Earnings from available-for-sale
investments - - - - 41 41
Share of earnings / (losses) from
equity-accounted investments (1) (5) 2 - (8) (12)
Net operating (loss) / earnings (896) 639 709 235 (31) 656
Net finance earnings / (expense)
(finance earnings less finance and
transaction expenses) 31 (23) (31) 2 (9) (30)
(Loss) / earnings before taxation (865) 616 678 237 (40) 626
Taxation 346 (157) (236) (79) (41) (167)
(Loss) / earnings for the period (519) 459 442 158 (81) 459
Investments** 6 107 3 - 98 214
Segment assets (note 1) 3 428 8 149 4 285 6 310 520 22 692
Segment liabilities (note 2) 2 861 7 087 1 580 1 975 945 14 448
Capital expenditure*** 45 384 615 306 134 1 484
Depreciation and impairment 93 402 581 97 8 1 181
Amortisation 11 - - 10 29 50
* Aveng Steel Fabrication (“ASF”), Aveng Manufacturing Automation & Control Solutions (“A&CS”) and Aveng Manufacturing
Facades business units are now reported under the Manufacturing and Processing segment, compared to the Construction and
Engineering: South Africa and Rest of Africa segment in the prior year. Comparatives have been adjusted.
** Consists of equity-accounted investments and available-for-sale investments.
*** Segment capital expenditure includes intangible asset expenditure of R29 million.
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
Note 1 - Reconciliation of segment assets
Total assets of the Group 32 099 28 628 30 413
Goodwill arising on consolidation (1 443) (1 400) (1 425)
Intangible assets (222) (163) (184)
Equity-accounted investments (219) (91) (144)
Available-for-sale investments (72) (147) (70)
Deferred tax assets (1 379) (1 011) (1 347)
Cash and bank balances (5 619) (5 263) (4 551)
Segment assets 23 145 20 553 22 692
Note 2 - Reconciliation of segment liabilities
Total liabilities of the Group 18 294 15 396 17 108
Borrowings and other liabilities (2 568) (1 450) (1 531)
Deferred tax liabilities (385) (255) (319)
Taxation payable (181) (161) (210)
Bank overdrafts (685) (508) (600)
Segment liabilities 14 475 13 022 14 448
The Group operates in five principal geographical areas:
REVENUE
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
South Africa 10 249 9 756 19 164
Rest of Africa including Mauritius 2 084 2 169 4 984
Australasia and the Pacific Islands* 13 467 11 753 24 661
Southeast Asia* 1 577 1 207 2 544
Middle East and other regions 277 102 351
27 654 24 987 51 704
* Included in the Australasia and the Pacific Islands and Southeast Asia geographical
segments is revenue derived by various operating segments.
SEGMENT ASSETS
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
South Africa 11 869 11 049 11 870
Rest of Africa including Mauritius 2 497 2 585 2 320
Australasia and the Pacific Islands 7 360 5 852 7 274
Southeast Asia 1 033 1 012 989
Middle East and other regions 386 55 239
23 145 20 553 22 692
CAPITAL EXPENDITURE
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
South Africa 355 431 776
Rest of Africa including Mauritius 144 169 257
Australasia and the Pacific Islands 136 147 327
Southeast Asia 14 35 57
Middle East and other regions - - 67
649 782 1 484
Notes to the interim condensed consolidated financial statements (continued)
5. Income tax
Six months Six months Year
ended ended ended
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
Current income tax charge 79 216 432
Deferred tax 34 (57) (265)
Income tax expense 113 159 167
Effective tax rate 26,9% 28,6% 26,7%
6. Cash and cash equivalents
31 December 31 December 30 June
2013 2012 2013
(Unaudited) (Unaudited) (Audited)
Rm Rm Rm
Cash and bank balances 5 619 5 263 4 551
Less: Bank overdrafts (685) (508) (600)
Cash and cash equivalents
4 934 4 755 3 951
Cash and bank balances
at the end of the period
include the following cash
and bank balances that are
restricted from immediate use:
Group share of cash held by
joint operations 1 375 966 935
Guardrisk Life Fund 48 45 40
1 423 1 011 975
7. Property, plant and equipment, Investment property and Intangible assets
During the six months ended 31 December 2013, the Group acquired assets at a cost of
R649 million (December 2012: R782 million).
8. Amounts due from / (to) contract customers
Six months Year
ended ended
31 December 30 June
2013 2013
(Unaudited) (Audited)
Rm Rm
Uncertified claims and variations (Underclaims) 1 5 535 4 181
Progress billings received (Overclaims) 2 (1 852) (1 690)
Uncertified claims and variations less progress billings received 3 683 2 491
Contract receivables 3 4 653 6 042
Retention receivables 4 199 174
8 535 8 707
Amounts received in advance 5 (500) (677)
Net amounts due from contract customers 8 035 8 030
Disclosed on the statement of financial position as follows:
Uncertified claims and variations 5 535 4 181
Contract and retention receivables 4 852 6 216
Amounts due from customers (current assets) 10 387 10 397
Progress billings received (1 852) (1 690)
Amounts received in advance (500) (677)
Amounts due to customers (current liability) (2 352) (2 367)
Net amount due from contract customers 8 035 8 030
1 Revenue not yet certified - recognised based on percentage of completion/measurement and agreed variations.
2 Progress billings are amounts billed for work performed on a contract irrespective of payment from the customer.
3 Certified revenue invoiced.
4 Retentions are amounts of progress billings that are not paid until the payment conditions specified in the
contracts are fulfilled or until defects have been rectified.
5 Advances are amounts received from the customer before the related work is performed.
9. Provisions
IFRS 2
share-based
payment Employee Leave pay Other
obligation entitlements benefits provisions Total
Balance as at 30 June 2012 34 978 499 660 2 171
Reallocated/recognised 10 13 135 252 410
Utilised - (297) (53) - (350)
Currency adjustment - 27 16 - 43
Balance as at 31 December 2012 44 721 597 912 2 274
Reallocated/recognised 11 235 382 447 1 075
Utilised - (17) (304) - (321)
Currency adjustment - 27 (26) - 1
Balance as at 30 June 2013 55 966 649 1 359 3 029
Reallocated/recognised 16 (25) 149 231 371
Utilised (10) (289) (130) (327) (756)
Currency adjustment - 32 28 - 60
Interest accretion - 2 3 9 14
Balance as at 31 December 2013 61 686 699 1 272 2 718
31 December 31 December 30 June
2013 2012 2013
Disclosed as:
Non-current provisions 1 166 1 091 1 105
Current provisions 1 552 1 183 1 924
2 718 2 274 3 029
10. Related party transactions
During the interim period Aveng Limited and its subsidiaries, in the ordinary course of business,
entered into various sale and purchase transactions with equity-accounted investments. There have
been no significant changes to the nature of related party transactions since 30 June 2013.
There were no related party transactions with directors or entities in which the directors have a
material interest.
11. Events after reporting date
Mr HJ Verster was appointed as Group Chief Executive Officer (CEO) effective 11 February 2014. Mr
Verster has not relinquished his statutory duties in terms of Section 3.84(g) of the JSE Listings
Requirements and will continue in his capacity as acting Financial Director until a new Financial
Director is employed.
The directors are not aware of any matter or circumstance arising since the end of the reporting
period not otherwise dealt with in the Group’s interim condensed results, which significantly affects
the financial position of the Group at 31 December 2013 or the results of its operations or cash
flows for the period then ended.
12. Major acquisitions and disposals
There have been no major acquisitions or disposals by the Group during the interim reporting
period.
Interim condensed consolidated statement of changes in equity for the six months ended 31 December
2013
Foreign Equity-settled
Total currency share-based
Share Share issued translation payment Insurance
capital premium capital reserve reserve reserves
Rm Rm Rm Rm Rm Rm
Six months ended 31 December 2012 (Unaudited)
Balance at 1 July 2012 19 1416 1435 546 - 56
Earnings for the period - - - - - -
Other comprehensive earnings for the period - - - 164 - 1
Total comprehensive earnings for the period - - - 164 - 1
Dividends - - - - - -
Total contributions and distributions recognised
directly in equity - -
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