| Tue 23 Oct 2001, 0:00 | | Cargo Carriers Limited - Unaudited Results For The |
|
August 2001 & dividend announcement,
And Acquisition of Two Inc Consulting
Cargo Carriers Limited
Registration Number 1959/003254/06
Incorporated in South AFRICA
(CARGO CARRIERS" OR "THE COMPANY")
JSE SHARE CODE: CRG
ISIN CODE: ZAE000001764
Unaudited results for the six months ended 31 August 2001 & dividend
announcement,
And Acquisition of Two Inc Consulting
Operational Review
After an extremely challenging year to February 2001, we are pleased to
announce a significantly improved performance for the six months ending 31
August 2001, with transport revenue up 8.5% and profit from operations up
102,7%. This solid performance is due in the main to improvement in cross
border delivery of fuel and to the `normal' climatic conditions experienced
by our agricultural operations. Although the industry has experienced
pressure on prices, we are happy to have maintained margins in spite of a
strike called in mid-August.
The improvement in activity levels together with the reduction in finance
charges have resulted in a significant increase in headline earnings by
105,6% to 24,3 cents per share. The gearing of the company has reduced to
35,3%, achieved mainly by the continued policy of restrained capital
expenditure. This is significantly improved against the 41.3% gearing at
last yearend.
Future Prospects
The group has and continues to progress on two fronts:
The re-organisation of the existing trucking business, both in terms of its
profitability and its positioning within the developing supply chain
industry.
The design of and commitment to new business units in the arenas of supply
chain management, e-transport and transport related IT, as defined in our
annual report.
Subsequent to the reporting date, a substantial strategic review was
completed which will result in improved focus and a restructure to improve
profit delivery and operational responsibility into the future. Ongoing
benefits from improved operating margins will exceed the initial costs of re-
organisation to be incurred in the second half of the financial year.
The second half of the year is subject to seasonal influences which
traditionally impact to a greater or lesser extent on the results for that
period, but management is cautiously optimistic.
Traditionally the second half of the year is not as profitable as the first
half and it is unlikely that the results reflected above will be repeated
over the next six months.
Acquisition of the business of Two Inc Consulting (Pty) Ltd
Introduction and Rationale
With effect from 1 September 2001, Cargo Carriers Limited acquired the
assets and liabilities of Two Inc Consulting (Pty) Ltd, a company that
sells, installs and implements Great Plains software and also has the
license to host the products. Cargo Carriers has traditionally been a
transport company, but in recent years has moved into logistics with a
strong emphasis on the development of information technology systems to
provide the services and functionality required by customers to manage their
supply chains. This acquisition provides the product, skills and expertise
to enhance this development.
Details of the Acquisition and Conditions Precedent
The assets and liabilities acquired from the vendor have been housed in a
shelf company acquired for the purpose, and it is proposed that 80% of the
shelf company will be retained by Cargo Carriers, while the balance will be
made available to the vendor, subject to the fulfilment of certain profit
warranties over the next two years. The price agreed upon is R2,4 million.
The purchase price will be settled with a payment of R2 million to the
vendor from the resources and facilities of Cargo Carriers. The balance of
the price is the value of the equity in the shelf company. The acquisition
is subject to the transfer of the two Great Plains software licences. It
is anticipated that there will be no problems fulfilling the conditions.
Financial Effects
Had the acquisition taken place on 1 March 2000, the financial effects on
the results of Cargo Carriers as at 28 February 2001, adjusted for the
purchase price, are reflected in the table below. The vendor has warranted
profits after tax over the next two years of R625,000.00. There is no
effect on net asset value.
The financial effects on Cargo results at 28/2/2001
Net Tangible Assets Headline Earnings
(R'000) (cents/share) (R'000)(cents/share)
Cargo audited@28/2/01 104,555 522,8 1,931 9,7
Two Inc audited@28/2/01 360 1
Proforma combined 102,915 514,6 1,736 8,7
Change proforma to actual % (1,57) (10,10)
Earnings
(R'000) (cents/share)
Cargo audited@28/2/01 (2570) (12.9)
Two Inc audited@28/2/01 (1)
Proforma combined (2765) (13.8)
Change proforma to actual % (7.17)
Dividend Declaration
Notice is hereby given that an interim dividend (number 21) of 2.5 (2000:
1.5) cents per share has been declared by the directors to shareholders
registered in the books of the company at the close of business on Friday 28
December 2001 (the record date). The last day to trade cum entitlement will
be Wednesday 19 December 2001 and the shares will trade ex-entitlement from
Thursday 20 December 2001. The dividend will be paid on Monday 31 December
2001. Share certificates may not be dematerialized/rematerialized between
Tuesday 11 December 2001to Friday 28 December 2001, both days inclusive.
Directorate
It is with deep regret that we record the passing of our Chairman, Mr Gerald
Stein on 18 July 2001. His broad experience and wise counsel will be sorely
missed by all at Cargo Carriers.
Consideration is being given to the appointment of additional non-executive
directors and in the interim Mr Stan Chilvers has been appointed acting
Chairman.
By order of the board
MJ Bolton
Secretary
23 October 2001
Directors
SG Chilvers (Chairman), GD Bolton, MJ Bolton (Joint Chief Executives)
Registered Office
140 North Reef Road Elandsfontein 1406
Transfer Secretary and CSDP
Mercantile Registrars Limited
LPC Manhattan Sponsors (Pty) Ltd
Website
www.cargocarriers.co.za
