| Fri 5 Oct 2001, 0:00 | | Interim Results Of Aquila Growth |
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Aquila Growth Limited
Registration
number
1995/003158/06
("Aquila" or "the INTERIM RESULTS OF AQUILA GROWTH
company") LIMITED FOR THE 6 MONTH PERIOD ENDED 31 AUGUST 2001
Share code : AQL
ISIN :ZAE000013959
Summarised Income Statement Summarised Balance Sheet
For 6 For 12 For 6 For 12
months months months months
ended 31 ended 28 ended ended 28
Aug 2001 Feb 2001 31 Aug Feb 2001
R'000 R'000 2001 R'000
R'000
Operating 1 254 124 230 Capital
income employed
Operating (2 595) (5 436) Share capital 101 928 125 140
expenditure and premium
Exceptional - (3 062) Non- 61 926 76 922
item distributable
reserves
Net (1 341) 115 732 Retained 112 311 113 662
(loss)/income income
before taxation
and finance
costs
Net finance 372 549 Ordinary 276 165 315 724
income shareholders'
interest
Net (969) 116 281 Preference 7 000 7 000
(loss)/income share capital
before taxation and premium
Taxation (42) (87) Current 3 503 5 689
Liabilities
Net (1 011) 116 194 Shareholders' 286 668 328 413
(loss)/income funds
after tax,
before
shortfall
arising on
revaluation of
investments
Unrealised (14 996) (65 749) Employment of
shortfall capital
arising on
revaluation of
investments
- Directors' 279 731 325 386 Equipment 231 249
valuation of
investments
held
at end of
period
- Directors' (294 727) (391 135) Investments 279 731 325 386
valuation of in investee
investments companies
held at year
end plus cost
of additional
investments
Current 6 706 2 778
assets
(Loss) / profit (16 007) 50 445 286 668 328 413
after shortfall
arising on
investments
(Loss) / (11.96) 32.02 Fully diluted 132 008 151 305
earnings per number of
share (cents) shares in
issue (`000)
Fully diluted 209.2 208.7
net asset
value per
share (cents)
Summarised
cashflow
statement
Net (1 341) 115 732 Statement of Changes in
(loss)/income Shareholders' Equity
before taxation
and finance
costs
Net cash (2 571) 111 568
(outflow)/inflo
w from
operations
(3 912) 227 300 Shareholder's 315 724 331 004
funds at
beginning of
the year
Cash flow from 30 638 (160 381) Issue of 1 283 2 003
investing shares
activities
26 726 66 919 Repurchase of (6 608) (12 207)
shares
Cash flow from (23 213) (65 032) Repurchase of (17 -
financing treasury 888)
activities shares
3 513 1 887 Reduction in - (54 829)
share premium
Cash and cash 2 198 311 Net (loss) / (16 50 445
equivalents at profit 007)
beginning of
period
Cash and cash 5 711 2 198 Preference (339) (692)
equivalents at dividend
end of period
Shareholders' 276 165 315 724
funds at 31
August 2001
MESSAGE TO SHAREHOLDERS
The directors have taken the decision to revalue the unlisted investments
once a year at year-end, except when there has been a permanent increase /
diminution in value. Accordingly, the directors have not revalued the
unlisted investments for the period under review.
However, in view of the negative economic environment currently being
experienced both locally and abroad, the board of directors have considered
it prudent to make a general provision of R40million against the valuation
of the underlying investments. This is particularly relevant given Aquila's
exposure to the US and EMEA markets, through its investments in AquiTec and
Gerber Global, and the uncertain local environment. This provision will be
reversed at year-end when the unlisted investments are revalued.
The directors are pleased with the performance of the underlying investee
companies for the period under review, and wish to point out that the
general provision set out above is not a reflection of any lack of
confidence in any underlying investment but rather a factor related to the
uncertainty currently prevailing over world markets.
The net asset value per share has increased by 0.3% from 208.7 cents per
share to 209.2 cents per share for the period under review. The Company
acquired 17 297 253 of its own shares, in terms on the specific repurchase
offer, at a price of 125 cents per share. In addition, the Company acquired
a further 2 000 000 of its own shares in the open market at a price of 140
cents per share.
SUMMARY REVIEW OF INVESTMENT PORTFOLIO
Global Resorts
In line with original project projections Global Resorts commenced repaying
shareholder loans, with the first such payment having been received during
May 2001. As a result of this receipt Aquila's cost of investment in Global
Resorts has reduced from R139.1m to R114.1m. Further repayments are
scheduled to take place on an annual basis, with the final repayment due at
the end of 2003. Caesars Gauteng increased gross gaming revenue by some 17%
and maintained a market share in excess of 28%. The other facilities
performed in line with expectation.
The Rewards Company
With effect from 11 May 2001, Aquila disposed of approximately 16.53% of its
shareholding in The Rewards Company for a cash consideration of R11.5
million. Following the disposal, Aquila's cost of investment in The Rewards
Company has reduced from R24.5m to R13.0m and its shareholding from 26.53%
to approximately 10%.
AquiTec Group Limited ("AquiTec")
During the period under review Aquila increased its investment in AquiTec
from R32.1 to R34.9m. AquiTec is a leading global provider of supply chain
execution software. The company has made significant progress in
stabilising the business, its staff and customer base following the
acquisition of the SCM/400 and SCM/e software from Uniteq, Inc., with effect
from 1 September 2000. A factor evidencing this progress is the recent
signing of AWG Kansas City as a customer of SCM/e. AWG Kansas City is the
second largest wholesale grocer in the USA with annual sales in excess of
US$3.2billion. For more information on AquiTec and its business activities
shareholders are referred to AquiTec's website at http://www.aquitecintl.com
Forecourt Television Network ("FTN")
During the period under review Aquila increased its investment in FTN from
R16.9m to R18.9m. The media sector has been affected by the negative
economic climate currently being experienced locally and abroad. Despite
these factors FTN has made significant progress in establishing itself as an
alternative medium of choice and the directors are positive about the
company's local and international prospects.
Just Fun Holdings
Aquila increased its investment in Just Fun Holdings from R11.8m to R12.8m
as a result of the acquisition, by Just Fun Holdings, of the sole
distribution rights for South Africa of the Seiko, Pulsar, Lorus, DKNY and
Diesel watch agencies with effect from 1 August 2001. The new company, a
subsidiary of Just Fun Holdings, will be trading as Just Time (Pty) Limited.
The initial response in the market place has been very positive and the
synergies created will strengthen the value offering of the group.
Gerber Global
Gerber Global through its subsidiary company, Ultra-Serv Holdings Limited
("Ultra-Serv"), acquired 100% of the equity in THG Trety Hospitality Group
Gmbh ("Trety") with effect from 1 Janaury 2001. The acquisition cost
consists of an upfront cash payment of US$1million plus US$1,500 per
installed Office unit, limited to 5 years. Trety owns the licence to the
"InnFax" and "Office" products for Europe including the United Kingdom. As a
result of the acquisition, Ultra-Serv will have approximately 13,855
installed units in 94 hotels in the EMEA and Asia Pacific regions.
POST BALANCE SHEET EVENT
Redgwoods Holdings Limited ("RetCorp")
Subject to the fulfilment of certain conditions precedent, RetCorp has sold
its shares and loan account in Redgwoods (Pty) Limited ("Reggie's") to Baby
King (Pty) Limited with effect from 1 October 2001. The consideration
attributable to Aquila is approximately R27,4m payable on terms commencing
on or about 31 December 2001 and ending on or about 31 December 2002. Had
the transaction been effective on 31 August 2001, this would have had the
effect of increasing the net asset value per share by 9.94% from 209.2 cents
per share to 230 cents per share and earnings per share by 167.6% from
-11.96 cents per share to 8.09 cents per share.
PROSPECTS
Aquila's primary objective is to work with the management of our underlying
investment companies in generating superior returns and maximising
shareholders' value. Our success in creating value for Aquila's shareholders
will thus be measured by the incremental long-term growth in the value of
our underlying investments.
The directors are pleased with the inherent quality of the investment
portfolio and confident that the underlying investments will yield superior
returns for our shareholders in the long term.
For and on behalf of the Board
DH Bagg P Papadimitropoulos
Chairman Managing Director
Johannesburg
8 October 2001
Directors: DH Bagg * (Chairman) Company Secretary: Karen du Preez
P Papadimitropoulos (Managing CA(SA)
Director) Private Bag X106
JA Bell Bryanston, 2021
P Dawe * + Tel: (011) 706-
B Dubb * Fax: (011) 706-6312
Website: www.aquilagrowth.com
E-mail: kdupreez@aquilagrowth.com
* Non-executive
+ British
