| Wed 15 Aug 2001, 0:00 | | Seardel Income Report 2001 |
|
SEARDEL INVESTMENT CORPORATION LIMITED
SEARDEL: SER: ZAE4029815
Unaudited Consolidated Income Statement FOR THE year ENDED 30 June 2001
Revenue +35%.
Headline earnings per share +28%.
Distribution per share 4,5 cents
2001 2000 % Change
Rm's Rm's on 2000
Revenue R2 550,2 R1 895,3 +35%
Profit from operations 108,9 63,6 +71%
Exceptional item - 1,9
Income before finance charges 108,9 65,5 +66%
Finance charges (70,3) (52,3)
Attributable earnings of
associated companies 10,3 32,6
Income before taxation 48,9 45,8 +7%
Taxation 11,4 2,9
Income after taxation 37,5 42,9 -13%
Income attributable to
minority interests - 0,2
Earnings attributable to
shareholders R37,5 R43,1 -13%
Headline earnings per
share - cents 37,1 28,9 +28%
Earnings per share - cents 35,0 40,3 -13%
Distribution per share
proposed - cents 4,5 6,0
Distribution cover on
headline earnings 8,2 4,8
Number of shares in
issue - millions 107,1 107,1
Capital and reserves -
Rmillions 966,6 520,3 +86%
Net asset value - cents
per share 902 467 +93%
COMMENTARY ON RESULTS
Revenue increased by 35% over last year to a record R2,6 billion. Of this
amount, R718,5 million relates to the six months trading period January to
June 2001, in which Frame Group Limited ("Frame") was accounted for as a
wholly owned subsidiary.
Operating income improved by 71% to R108,9 million. Pre-tax income increased
by 7% to R48,9 million (2000: R45,8 million). Headline earnings per share
increased by 28% to 37,1 cents.
Frame became a wholly owned subsidiary during December 2000. This
acquisition and the positive effects thereof were fully detailed in the
appropriate documentation that was sent to both Frame and Seardel
shareholders. Simultaneously with the acquisition, Frame Group Limited was
delisted from the JSE Securities Exchange. It is pleasing to note that Frame
produced results that were consistent with our forecasts at the time of
acquisition. Included in attributable earnings of associated companies is
the group's share of the earnings of Frame for the first period of the
financial year.
Seardel acquired the minority interests of Prima Toy & Leisure Group Limited
and Seartec Limited during the course of the financial year. Both these
companies were then also delisted from the JSE Securities Exchange.
It is pleasing to note that both Seartec and Prima have, as predicted,
achieved a turnaround and produced acceptable results, whilst certain
apparel divisions had a tough year
Group capital and reserves increased by 86% to R966,6 million (2000: R520,3
million) and net asset value per share increased to 902 cents (2000: 467
cents).
The number of shares in issue remains unchanged at 107,134,284.
CURRENT TRADING CONDITIONS
As predicted a year ago, the advent of the Africa Growth and Opportunity Act
and the European Union Agreement have provoked enormous international
interest in the entire fibre-yarn-textile-clothing pipeline in sub-Saharan
Africa. SARS Customs Department is to be congratulated on the efficient
manner in which they have implemented country-of-origin documentation to
obviate trans-shipment. South Africa has a huge window of opportunity before
the quota provisions of the Agreement on Textiles and Clothing fall away in
2005 and before China's full accession to the WTO in 2009. Locally, further
reductions in the prime overdraft rate are required to stimulate domestic
demand.
Once again export business expanded in the year under review, amounting to
R249 million, an increase of 9%. Seardel's compound rate of growth in
exports over the past four years amounts to 34%. Exports now amount to 17,2%
of total apparel business, compared to 14% the previous year. Seardel is
the dominant value-added exporter in the local market.
Last year we reported that Seardel had integrated its export website into
the electronic catalogue of Global Sources.com on a trial basis. Although
numerous queries were generated, these did not translate into meaningful
orders. The most successful model for the generation of export business is
still face-to-face contact between the international retailer and the South
African clothing manufacturer, or the South African manufacturer working
directly with international sourcing companies located in South Africa.
PRELIMINARY ANNOUNCEMENT OF DISTRIBUTION
The board has proposed the payment of a single distribution of 4,5 cents per
share (2000: 6 cents) in respect of the year ended 30 June 2001.
In line with the board's declared intention of conserving cash, the
distribution cover on headline earnings per share is increased to 8,2 times
(2000: 4,8 times).
Shareholders will be asked to confirm this distribution at the annual
general meeting to be held during October 2001.
The above proposed distribution will be paid on or about Friday 16 November
2001 to shareholders registered in the books of the company at the close of
business on Friday 2 November 2001, the record date. The last date trade
cum. div. is Friday, 26 October 2001. From Monday, 29 October 2001 all
trades are ex. div.
The annual report, including the chairman's review and audited financial
statements, will be posted to shareholders during September 2001.
By order of the board of Seardel Investment Corporation Ltd.
Reg. No. 1968/011249/06.
DR A SEARLL D.B.A. (Chairman)
A D JACOBSON C.A. (S.A.) (Financial Director)
16 August 2001
Secretary and Registered Address
L A Clohessy, 2nd Floor, Seardel House, Alphen Park, Constantia Main Road,
Constantia 7806,
Cape Town
Board of Directors
A Searll (Chairman), G C de Bruin (Joint Managing), B G Richards (Joint
Managing), C Beekman, K A G Blumberg**, M D Davidson, S H Diamond,
T Eboka**, A D Jacobson, A Keller, R L Richter, M R Sternberg,
W Simeoni, E Stummer, R J Whiteford, K Winer. ** Non-Executive
