| Tue 16 Oct 2001, 0:00 | | Rentsure - Unaudited Results For The Year Ended 30 |
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Rentsure Holdings Limited
Registration number 1946/023539/06
("Rentsure")
Alpha code: RNT
ISIN number: ZAE 000012811
PRELIMINARY RESULTS
FOR THE YEAR ENDED 30 June 2001
CONSOLIDATED INCOME STATEMENT
for the year ended 30 June
Audited Unaudited Unaudited
Actual Preliminary1 Pro forma2
2000 2001 2001
R'000 R'000 R'000
Net premium income 241 350 249 238 393 217
Recurring premiums 235 049 243 628 387 607
Single premiums 6 301 5 610 5 610
Investment income 27 730 30 732 127 770
Income 269 080 279 970 520 987
Commission 53 659 49 535 63 384
Marketing, sales and
administration expenses 91 036 94 805 138 066
Taxation 703 2 500 6 309
Outgo 145 398 146 840 207 759
Excess of income
over outgo 123 682 133 130 313 228
Claims and policyholder
benefits (108 818) (131 069) (188 296)
Transfer from/(to) life
assurance fund 2 343 7 967 (81 765)
Profit on ordinary
activities
after taxation 17 207 10 028 43 167
Outside shareholders'
interest (5 789) (3 664) (242)
Profit for the year 11 418 6 364 42 925
Dividends (2 830) (910) -
Retained profit for
the year 8 588 5 454 42 925
Earnings 11 418 6 364 42 925
Fully diluted earnings
per share (cents) 28,2 15,7 45,5
Dividends per share (cents) 7,00 2,25 -
Dividend cover 4 7 -
Calculated on a
weighted average
number of shares
issued ('000) 40 438 40 438 94 4193
CONSOLIDATED BALANCE SHEET
at 30 June
Audited Unaudited Unaudited
Actual Preliminary1 Pro forma2
2000 2001 2001
R'000 R'000 R'000
ASSETS
Non-current assets 263 906 277 035 1 006 695
Investments 94 008 105 949 814 122
Fixed property,
machinery and equipment 158 528 159 716 173 727
Cost of control
arising on consolidation 11 370 11 370 18 846
Current assets 145 522 130 609 223 088
Inventories 22 718 24 974 24 974
Debtors and deposits 86 806 73 821 91 067
Cash 35 998 31 814 107 047
Total assets 409 428 407 644 1 229 783
EQUITY AND LIABILITIES
Capital and reserves 88 120 96 724 188 608
Share capital 8 394 8 394 89 366
Non-distributable reserves 19 272 19 272 20 085
Distributable reserves 359 359 1 525
Retained income 33 833 39 287 75 848
Shareholders' funds 61 858 67 312 186 823
Minority shareholders'
interest 26 262 29 412 1 785
Non-current liabilities 248 231 239 342 942 643
Life assurance fund 244 453 236 486 934 450
Long-term liabilities 3 778 2 856 8 192
Current liabilities 73 077 71 578 98 532
Short-term loans 1 986 834 834
Amounts due to bankers 9 810 3 695 3 695
Creditors and provisions 58 289 63 310 90 067
Taxation 1 577 3 739 3 937
Shareholders for dividend 1 415 - -
Total equity and
liabilities 409 428 407 644 1 229 783
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 30 June
Unaudited Audited
Preliminary1 Actual
2001 2000
R'000 R'000
Net cash flow from operating
activities 6 568 22 842
Cash from clients 249 238 241 350
Cash paid to suppliers and
employees (260 897) (241 143)
Cash from operations (11 659) 207
Investment income 18 227 22 635
Net cash flow from investment
activities (26 978) (26 065)
Acquisition of fixed assets (18 009) (9 812)
Increase in investments (11 941) (17 583)
Proceeds on disposal of
fixed assets 2 972 1 330
Net cash flow from financing
activities 16 226 (1 039)
Decrease in lonas (924) (765)
Other 17 150 (274)
(4 184) (4 262)
Cash beginning of the period 35 998 40 260
Cash end of the period 31 814 35 998
Notes:
1. Preliminary unaudited consolidated results of Rentsure.
2. Preliminary unaudited consolidated results of Rentsure, consolidated
with the unaudited results of Assupol.
3. The maximum number of shares in issue calculated in respect of the
transactions referred to in paragraph 3.
STATEMENT OF CHANGES IN EQUITY
for the year ended 30 June
Non-
Distri- Distri- Re-
Share butable butable tained
capital reserves reserves income Total
Balance on
30 June 1999 8 394 19 272 359 25 245 53 270
Net profit for
the year (actual) - - - 11 418 11 418
Dividends - - - (2 830) (2 830)
Balance on
30 June 2000 8 394 19 272 359 33 833 61 858
Net profit for
the year
(unaudited) - - - 6 364 6 364
Dividends - - - (910) (910)
Balance on
30 June 2001 8 394 19 272 359 39 287 67 312
COMMENTS
1. Introduction
The results of Rentsure and the pro forma consolidated results of Rentsure
and Assupol presented are unaudited preliminary results. These results have
not been finalised pending finalisation of the transactions referred to in
paragraph 3 below.
2. Overview of Rentsure preliminary results
Rentsure Holdings experienced difficult trading conditions during the year
under review, specifically pertaining to the results of Rentsure's
subsidiary, Rentmeester Assurance Limited ("Rentmeester") caused by, inter
alia, the following:
- the temporary suspension of the government payroll deduction system
("Persal") which prevented new business administered under Persal for a
period of approximately nine months and the effect of new limits on all
premium increases;
- the lapses in policies experienced as a result of Persal-related events;
- once-off restructuring and reorganisation costs of
R2,2 million incurred in respect of the closing of 18 branches and
retrenchments of certain branch and head office personnel;
- an additional strengthening of the provision against agent loans and
advances by R7,5 million;
- the losses suffered by Rentmeester's subsidiary, Alnet (Proprietary)
Limited ("Alnet"), as a result of extensive fraud and theft perpetrated in
its export division over a number of years and discovered recently; the
total historical negative impact of this has been calculated to be in the
extent of R17,8 million, with a further
R2 million included in the results under review;
- losses of R2,9 million incurred at Alnet as a result of a three week
strike at its factory and the related disruption to its production
processes; and
- once-off costs of approximately R2,4 million incurred by Alnet pertaining
to the retooling of capital equipment and the restructuring of production
processes.
Notwithstanding the above, total net premium income increased by 3,3% and
net recurring premium income by 3,7%. The increase in claims and
policyholder benefits is mainly attributable to policy maturity claims and
surrenders.
3. Proposed merger with Assupol and restructuring transactions
Shareholders are referred to the announcement dated
3 October 2001 regarding, inter alia, the proposed:
- merger of Rentmeester with Assupol;
- introduction of Nozala Investments (Proprietary) Limited as a significant
economic empowerment stakeholder with a minimum shareholding of 20% in
Rentsure; and
- acquisition of the 30% of Rentmeester's issued share capital in order to
constitute Rentmeester as a wholly owned subsidiary of Rentsure.
The pro forma effect of these transactions, assuming they were all
implemented on 1 July 2000 and that all the Assupol policyholders elected to
subscribe for Rentsure shares with their windfall cash payments, is depicted
in the pro forma consolidated preliminary results of Rentsure and Assupol,
for illustrative purposes only. Shareholders should note that these pro
forma consolidated preliminary results do not reflect adjustments to some of
the accounting policies of Rentsure or Assupol which will be aligned
following implementation of the proposed merger.
The full details pertaining to these transactions will be disclosed in a
circular to shareholders to be posted in due course.
4. Prospects
The Board is positive that the normalisation of Persal deductions, the
cleaning up of Alnet's operations, the proposed merger of Assupol with
Rentmeester and the introduction of an economic empowerment stakeholder
would generate significant future benefits for policyholders and
shareholders.
5. Dividend
In the light of the proposed transactions set out in paragraph 3 above, the
Board has decided not to declare further dividends in respect of the year
under review. This decision would furthermore allow Assupol's policyholders
electing to become Rentsure shareholders to share in future dividend
declarations. Given the timing of the implementation of the proposed
transactions, the Board
will only declare an interim dividend for the six months ending 31 December
2001 following the finalisation of the above transactions.
By order of the Board
J Vermooten
(Chairman)
15 October 2001
Registered office:
106W Rentmeester Park, 74 Watermeyer Street, Val de Grace, Pretoria 0184
Transfer secretaries:
Mercantile Registrars Limited, 11 Diagonal Street, Johannesburg 2001
Directors:
Joachim Vermooten (Chairman), Johannes Vermooten, Dr MI Vermooten Prof Q
Vorster, W Stals
