| Wed 29 Aug 2001, 0:00 | | Adcorp Holdings Limited - Interim Results |
|
Adcorp Holdings Limited
(Registration number 1974/001804/06)
Highlights
- Earnings per share up 16%
- Headline earnings per share up 13%
- Operating profit up 30%
- Attributable profit up 22%
- Turnover up 27%
Interim results for the six months ended 30 June 2001
Consolidated income statement
Audited
Reviewed* Reviewed 12 months
30 June 30 Jun 31 December
2001 Change 2000 2000
R'000 % R'000 R'000
Turnover 549 665 26,5 434 545 963 443
Operating profit 54 234 30,4 41 605 93 364
Net investment income 1 036 (76,1) 4 333 6 021
Loss on sale of subsidiary - - (380)
Profit before taxation 55 270 20,3 45 938 99 005
Taxation 16 816 14,9 14 636 26 914
Profit after taxation 38 454 22,9 31 302 72 091
Share of income from
associated companies 299 - - 223
38 753 23,8 31 302 72 314
Portion of (profit)/loss
attributable by/(to)
minorities (405) - 110 -
Earnings attributable to
ordinary shareholders 38 348 22,1 31 412 72 314
Reconciliation of headline
earnings
Earnings
Attributable to
ordinary shareholders 38 348 22,1 31 412 72 314
Loss on sale of assets - - 380
Profit on investment (1 532) - - -
Add back goodwill amortised 2 315 46,1 1 585 2 835
Headline earnings 39 131 18,6 32 997 75 529
Number of shares in issue
- weighted (000) 40 567 5,0 38 638 39 338
Earnings per share D cents 94,5 16,2 81,3 184
Headline earnings per share
- cents 96,5 13,0 85,4 192
Reviewed by Charter Financial & Auditing Incorporated
Consolidated cash flow statement
Reviewed* Reviewed Audited
Six months to Six months to 12 months to
30 June 30 June 31 December
2001 2000 2000
R'000 R'000 R'000
Cash generated by operations 64 740 48 951 113 145
Increase in working capital (40 175) (18 209) (34 997)
Cash generated by operating
activities 24 565 30 742 78 148
Net investment income 1 036 4 333 6 021
Taxation paid (10 976) (13 361) (31 231)
Dividend paid (11 312) (8 033) (8 033)
Cash available from
operating activities 3 313 13 681 44 905
Cash effects from investment
and financing activities (25 219) (10 059) (131 794)
Net cash movement (21 906) 3 622 (86 889)
Cash on hand at the beginning
of the period 2 647 89 536 89 536
Net cash on hand at the
end of the period (19 259) 93 158 2 647
Consolidated abridged balance sheet
Reviewed Reviewed Audited
30 June 30 June 31 December
2001 2000 2000
R'000 R'000 R'000
ASSETS
Non-current assets 209 258 197 140 201 810
Fixed assets 64 583 62 929 61 938
Investments and loans 139 162 133 115 133 611
Deferred taxation 5 513 1 096 6 261
Current assets 204 353 251 413 223 178
Cash at bank - 97 803 47 416
Other current assets 204 353 153 610 175 762
Total assets 413 611 448 553 424 988
EQUITY AND LIABILITIES
Capital and reserves 271 164 243 271 242 779
Share capital and reserves 290 022 136 358 250 940
Vendor shares 6 664 106 913 6 022
Cost price of shares held
by subsidiary (25 522) - (14 183)
Non-current liabilities 6 580 9 821 5 172
Minority shareholders'
interest 405 24 -
Interest bearing long-term
liabilities 2 813 9 797 1 810
Deferred taxation 3 362 - 3 362
Current liabilities 135 867 195 461 177 037
Interest bearing current
liabilities 19 259 4 974 44 769
Cash due to vendors 6 046 75 631 10 122
Non-interest bearing current
liabilities 110 562 114 856 122 146
Total equity and
liabilities 413 611 448 553 424 988
Number of ordinary
shares in issue (000) 40 460 35 432 40 830
Net asset value per
share - cents 670 583** 595
Return on net assets (%) 18,5 17,7 19,5
**Based on 41,7 million
shares which includes the shares issued for Acumen and Graphicor.
Comments
Overview
Adcorp's key focus over the past six months has been on the implementation
of the group's core strategy of selling innovative professional business
solutions, consolidating certain group offerings and exploiting its organic
growth potential. To this end, the group has integrated well, while the
trading results for the six month period ended 30 June 2001 have been
satisfactory. Earnings per share increased by 16,2% compared to the prior
year comparative period while headline earnings per share showed a 13%
increase.
Flexible staffing, communications and recruitment advertising performed
exceptionally well during the period under review. Market research performed
according to expectations with the Customer Equity Company joint venture
starting to deliver tangible benefits. The permanent recruitment companies
had mixed fortunes with certain key market segments feeling the pressure of
a weak economy coupled with the negative impact of fallout in the
information technology and financial services sectors which traditionally
have shown significant net growth in employment.
The training operations had a disappointing first half to the year with a
number of sizeable contracts being postponed to the latter part of the year.
Their performance is expected to improve in the second half.
Financial
Turnover increased by 26,5% over the same period last year while operating
profit showed a 30,4% increase. The increase in operating profit largely
reflects an increase in trading activity as well as an improvement in
operating margins resulting from a continued focus on adding value to
existing product and service lines.
Cash generated by operations during the six month period amounted to R65
million of which R40 million was required to finance working capital. While
debtors days reduced slightly, the increase in turnover together with an
increase in operating activity in the flexible staffing operations increased
the working capital requirement. Debtors days are expected to reduce during
the second half. The Acumen Share Trust was dissolved with effect from1
January 2001 resulting in 686 000 shares reverting back to
Adcorp. In addition, Adcorp bought back 168 000 Adcorp shares in the second
quarter and intends to continue buying back shares in the second half of
2001.
Outlook
Despite tough trading conditions, the group has a strong pipeline of work
for the remainder of the year.
The positioning of the group as leaders in human capital management,
communications and business intelligence within the South African market
combined with its excellent brands, client base and people bodes well for
the future.
By order of the board
Richard Pike Faunce Burd
Chief Executive Officer Financial Director 29 August 2001
Directors: Dr F van Zyl Slabbert (Chairman), RL Pike (Chief Executive
Officer), VC Baker, HW Barenblatt, FD Burd, M Liphosa, Dr RD Marcus, RB
McGregor
Non-executive Directors: SO Shonhiwa (Deputy Chairman), Dr DE Baloyi, JK
Barry, Dr FP Jacobsz, MH Lekota, Dr MP Ngwenya, LM Rouillard*, L Roussos*, A
Rubinstein, IB Skosana, PC Swart
Alternate Director: RPearce*
*Executive directors in group companies
Visit our website at http://www.adcorp.co.za
