| Fri 25 Nov 2016, 7:05 | | WINHOLD LIMITED - Provisional Reviewed Condensed Consolidated Financial Results for the year ended 30 September 2016 |
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WNH 201611250002A
Provisional Reviewed Condensed Consolidated Financial Results for the year ended 30 September 2016
WINHOLD LIMITED
(Registration number 1945/019679/06)
Incorporated in the Republic of South Africa
Share code: WNH ISIN: ZAE000033916
Provisional Reviewed Condensed Consolidated Financial Results for the
year ended 30 September 2016 and Dividend Declaration
STATEMENT OF FINANCIAL RESULTS
Condensed Consolidated Statement of
Comprehensive Income
Year ended Year ended
30 Sept 30 Sept
2016 2015
(Reviewed) (Audited)
R000's R000's
External revenue 1 149 043 1 222 304
Operating profit 28 324 39 759
Investment income 112 4 207
Net finance costs (6 647) (8 061)
Profit before taxation 21 789 35 905
Taxation (2 687) (5 301)
Share of associates Profit after Tax 529 531
Profit for the year 19 631 31 135
Profit attributable to non-controlling
interests 2 949 3 733
Profit attributable to equity holders of the
parent 16 682 27 402
Other Comprehensive Income
- Actuarial remeasurement defined benefit
pension fund excluding tax (3 771) (27)
Total Comprehensive income for the year 15 860 31 108
Profit and Total comprehensive income
attributable to non-controlling interests 2 949 3 733
Total comprehensive income attributable to
equity holders of the parent 12 911 27 375
Earnings and diluted earnings per share 13.3 21.8
(cents)
Notes: Earnings per share and additional
information
Headline and diluted headline earnings / share 13.1 22.0
Weighted average ordinary shares
Adjusted for treasury stock (000's) 125 506 125 506
Total ordinary shares issued (000's) 126 215 126 215
Total depreciation and amortisation 14 915 14 457
EBITDA 43 239 54 216
Reconciliation of headline earnings
Profit attributable to Equity Holders of the
parent 16 682 27 402
-Profit on disposal of fixed assets (83) (149)
-Taxation effects of the above 23 30
Total headline earnings 16 622 27 283
Condensed Consolidated Statement
of Financial Position
Year Year
ended ended
30 Sept 30 Sept
2016 2015
(Reviewed) (Audited)
R000's) R000's
ASSETS
Non-current assets 170 894 183 884
Property, plant and equipment 127 774 134 689
Investments and loans 3 478 7 094
Goodwill 19 541 19 541
Deferred Taxation 20 101 22 560
Current assets 350 919 414 696
- Inventory 155 803 165 143
- Receivables 175 037 241 332
- Bank and cash 20 079 8 221
TOTAL ASSETS 521 813 598 580
EQUITY AND LIABILITIES
Stated Capital 122 793 122 793
Retained earnings and Reserves 178 111 174 035
Equity attributable to owners of
the parent 300 904 295 828
Non controlling interests 11 564 8 615
Total Equity 312 468 305 443
Non current liabilities 21 588 32 969
- Interest bearing 14 711 22 995
- Interest free 3 315 3 178
- Deferred taxation 3 562 6 796
Current liabilities 187 757 260 168
Interest-bearing
- Bank overdraft - 12 975
- Short-term borrowings 14 473 41 083
Interest free ?
- Payables and provisions 173 284 206 110
521 813 598 580
Year Year
ended ended
30 Sept 30 Sept
2016 2015
(Reviewed) (Audited)
R000's R000's
SUPPORTING INFORMATION
- Capital commitments at period end 1 671 667
- Capital expenditure during the period 12 188 13 638
- Total interest-bearing borrowings 29 184 77 053
- Total interest-earning deposits 20 079 8 221
- Net asset value per share (cents) 239.8 236.5
- Total intangible assets(R000) 39 642 42 101
- Tangible net asset value per share (cents) 208.2 203.0
- Gearing (operational) (%) 15.4 15.4
- Gearing (total) (%) 25.9 25.9
- Return on equity (%) 9.7 9.2
- Return on assets (%) 9.7 5.2
Condensed Consolidated Statement of Changes in
Equity
Year ended Year ended
30 Sept 30 Sept
2016 2015
(Reviewed) (Audited)
R000's R000's
- Stated Capital 122 793 122 793
-Opening balance retained earnings 175 802 148 400
-Profit for the year 7 847 27 402
-Total comprehensive income 19 631 31 135
-Ordinary dividend paid (8 835) -
-Attributable to non-controlling interest (2 949) (3 733)
-Actuarial Reserve (5 538) (1 767)
- Balance beginning of the year (1 767) (1 740)
- Actuarial re-measurement for the year (3 771) (27)
Balance at the end of the year 300 904 296 828
Condensed Consolidated Statement of Cash
Flows
Year ended Year
30 Sept ended
2016 30 Sept
2015
(Reviewed) (Audited)
R000's R000's
Cash flow from/(used in) operating activities 34 319 (12 205)
Cash flow from trading 39 634 58 349
Changes in working capital 14 956 (55 036)
Finance costs paid (6 749) (8 641)
Finance income received 102 580
Dividends from associates 274 281
Dividends paid (8 835) -
Taxation paid (5 063) (7 738)
Cash flow from investing activities 25 409 40 566
(Investment in)/proceeds from fixed assets (7 917) (12 745)
Proceeds from loans receivable 33 326 53 311
Cash flow from financing activities (34 895) (48 872)
Interest-bearing borrowings repaid (34 895) (48 872)
Interest-bearing loans raised - -
Net Increase/(decrease) in cash 24 833 (20 511)
Balance at the beginning of the year (4 754) 15 757
Balance at the end of the year 20 079 (4 754)
Condensed Consolidated Statement of Segmental Results to 30 September
Flexible Packaging(1) Flexible
Building(2)
2016 2015 2016 2015
R 000's R 000's R 000's R 000's
Revenue?External 297 605 319 817 281 092 349 984
Revenue?Inter-segment 153 574 159 183 136 632 99 199
Revenue ? Total 451 179 479 000 417 724 449 183
Depreciation 7 589 7 367 5 091 5 003
Investment Income - - - -
Profit before Tax (&) (30 966) (14 222) 24 185 31 471
Capital expenditure 172 361 2 653 3 807 9 018
Total assets 90 173 258 912 141 576 179 728
Total liabilities 205 447 123 866 63 339 97 293
Trading(3) Property & Group(4)
2016 2015 2016 2015
R 000's R 000's R 000's R 000's
Revenue?External 570 297 552 461 49 41
Revenue?Inter-segment 13 514 15 671 (303 720) (274 053)
Revenue ? Total 583 811 568 132 (303 671) (274 012)
Depreciation 1 809 1 837 426 250
Investment Income - - 112 4 207
Profit Before Tax (&) 17 393 15 206 11 177 3 450
Capital expenditure 2 142 1 913 684 54
Total assets 161 310 166 982 46 566 (7 042)
Total liabilities 63 494 113 094 (7661) (41 116)
Notes to the Segmental Analysis ?
(&) 'Profit before Tax'is stated before allocated management fees
(1) The Flexible Packaging segment comprises the Flexible Consumer and
Industrial Packaging Divisions operating out of Germiston and
Swaziland
(2) The Flexible Building segment comprises the Flexible Construction and
Agricultural Division and the GeoSynthetics dam lining divisions in
Springs
(3) The Trading Division comprises the Gundle and Inmins Trading branches
(4) Property and Group relate to the elimination of inter-group
transactions and group costs
CONTINGENT LIABILITY, LITIGATION AND SUBSEQUENT EVENTS
There is no material pending litigation and the directors are not aware of
any material contingent liabilities or post balance sheet events between
the balance sheet date and the date of this report.
REVIEW OPINION
These condensed consolidated financial statements for the year ended
30 September 2016 have been reviewed by the group's auditors, Mazars, who
expressed an unmodified review opinion. A copy of the auditors review
opinion is available for inspection at the company's registered office
together with the financial statements identified in the auditor's review
report. The auditor's report does not necessarily report on all of the
information contained in this announcement/financial results. Shareholders
are therefore advised that in order to obtain a full understanding of the
nature of the auditor?s engagement they should obtain a copy of the
auditor's report together with the accompanying financial information from
the issuer's registered office.
GROUP PROFILE
Winhold Limited (?Winhold?) is a holding company with its main
investments being in its 74,9% owned subsidiaries Gundle Plastics Group
(Pty) Ltd (?Gundle?) and Inmins Trading (Pty) Ltd (?Inmins?).
Gundle comprises three divisions, the Industrial and Consumer Flexible
Packaging Division with its factories in Germiston and Swaziland, the
Flexible Building, Construction and Agricultural Division in Springs
(including the Geosynthetics Dam Lining Division) and the Trading
Division with branches in the main coastal cities, Bloemfontein and
Mbombela. Gundle manufactures polyethylene bags, construction sheeting,
consumer and industrial packaging, agricultural film and dam linings and
distributes to the agricultural, chemical, construction, food processing,
industrial and consumer markets, as well as installing dam linings in
sub-Sahara Africa.
Inmins comprises 18 strategically located operations servicing the mining
and industrial sectors with a wide range of consumable and maintenance
products, and includes divisions specialising in hose, chain and sprocket
systems and conveyor belting.
COMMENTARY
Due to the implementation of the turnaround strategy at one of the major
subsidiaries, the profitability of the group was negatively affected as
shown by the reduction in earnings of 40% to 13,1 cents per share.
Turnover reduced by 6%. Good performances by the other divisions have
nonetheless enabled the company to declare a dividend.
Investment income reduced due to the investment in preference shares
being redeemed during the year. The effective tax rate is 12% after
utilising tax losses from prior years. The reduction in receivables
relates to the reduced turnover referred to in the review of operations
below. The repayment of the BEE transaction loans and the settlement of
asset finance resulted in a reduction of borrowings.
REVIEW OF OPERATIONS
Gundle
One of the manufacturing operations was subject to a turnaround strategy,
which was completed during the second half of the year. The
implementation of this strategy meant changed management, a major
reduction of 39% in headcount, change of behavioural patterns and the
establishment of a new culture, enforcing more stringent controls and the
introduction of new management techniques. The reduced labour force and
new management bought into these changes and a new spirit is developing -
so much so that the last month of the financial year showed a much
improved performance. The breakeven point has been reduced dramatically
as a result of inefficiencies such as scrap and overtime being addressed.
Market conditions remain tough, but we trust that the major losses have
been halted. More throughput remains the goal.
As per the half year, no major projects were secured by the dam lining
division during the second half of the financial year. This related to a
much reduced profitability of 60,9% versus the previous bumper year.
However, the results achieved were as per budget, and, as such, the
division did well.
Improvement in the construction and agricultural division ensured that
the market share increased and the division achieved its best ever
profitability.
The Gundle trading division improved its profitability by 27% in a
difficult overtraded market.
Repositioning the Swaziland division continues as more and more market
share is captured in Swaziland. Management changes and better
productivity should lead to consistent future profitability.
Repi Colourants
Repi Colourants continued producing impressive results due to the
excellent service provided. This division continues to go from strength
to strength.
Inmins
The industrial division's overall profitability improved by 88% against
the prior year. Two operations did extremely well, although the market
remained depressed and difficult.
In the mining division, four operations were merged into two and the cost
savings should produce improved future results. The difficult economic
climate continued causing the profitability to reduce drastically.
It is pleasing to report that, overall, Inmins' profitability increased
by 25,9%.
PROSPECTS
Gundle
The turnaround strategy in the largest subsidiary should bear fruit soon
and a major improvement is expected and required in the coming year.
Although the dam lining operation continues to supply excellent services,
a major contract will make a substantial improvement to its
profitability. In the other construction and agricultural markets, new
developments and proactive management should continue to produce good
results. The trading division is well positioned, has good management,
and should continue to do well.
Inmins
The cost cutting exercise in the mining division should reduce losses and
management will continue to act proactively. However, the economic
mining climate will have to improve considerably for results to improve
meaningfully. The challenges in the industrial division will continue,
but our market positioning should ensure continued profitability.
APPRECIATION
The support from customers, suppliers, financial institutions and
shareholders in a very difficult year is highly appreciated. The
commitment of the management team and staff is once again noted. The
support of the chairman, board, management and staff, customers and
suppliers, cannot be overstated.
BASIS OF PREPARATION
These provisional condensed consolidated financial statements have
been prepared in accordance with the framework concepts and
measurement and recognition requirements of International Financial
Reporting Standards Council (?IFRS?) and the SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee and contain at
a minimum the information required by International Accounting
Standard 34 - Interim Financial Reporting ("IAS34"),other than the
information required pursuant to paragraph 16A(j) of IAS34 which is
not required to be published through SENS, the Listings Requirements
of the Johannesburg Stock Exchange (?the Listings Requirements?) and
comply with the South African Companies Act. The accounting policies
applied are consistent with those used in the prior year. The
preparation of the provisional condensed consolidated financial
statements has been supervised by the CEO, and acting CFO Mr. W Fourie
CA(SA).
CORPORATE GOVERNANCE
The Group believes in the value of good corporate governance and,
where possible, is committed to continued implementation of
the recommendations of the King III Report and the Listings Requirements.
The Group endeavours to continue to conduct its business in accordance
with the principles of accountability, transparency and integrity.
DIRECTORATE
Ms M Fry was appointed to the Board as an independent non-executive
director with effect from 1 February 2016. There were no other changes
to the board during the year.
DECLARATION OF DIVIDEND
The board has declared a final dividend (dividend number 16) of 4 cents
(2015: 7 cents) per share for the year ended 30 September 2016. The
dividend is subject to Dividends Withholding Tax (?Dividends Tax?) that was
introduced with effect from 1 April 2012. In accordance with the
provisions of the JSE Listings Requirements, the following additional
information is disclosed:
- the dividend has been declared out of current year income
- the local Dividends Tax rate is 15%
- the gross local dividend amount is 4 cents per share for shareholders
exempt from Dividend Tax
- the net dividend amount is 3.4 cents for shareholders liable for
Dividends Tax
- the company has 126 215 131 ordinary shares in issue
- the company?s income tax reference number is 9775 223 713
The following dates are applicable to the dividend:
The last day to trade in order to be eligible for the dividend will be
Tuesday, 21 February 2017.
Shares will trade ex-dividend from Wednesday, 22 February 2017.
The record date will be Friday, 24 February 2017 and payment will be made
on Monday, 27 February 2017.
Share certificates may not be dematerialised/re-materialised between
Wednesday, 22 February 2017 and Friday, 24 February 2017, both days
inclusive.
For and on behalf of the board
WAR WENTELER W FOURIE
Chairman Chief Executive Officer
Date: 24 November 2016
Winhold Limited (Share code: WNH, ISIN ZAE000033916) Registration number
1945/019679/06 Incorporated in the Republic of South Africa,
884 Linton Jones Street, Industries East, Germiston.
Tel:+2711 345 9800
Fax: +27 11 345 9881
Directors: W A R Wenteler (Chairman) ?, W Fourie (CEO), M Fry ??,
H Jeena ??, R Naidoo ??,P C Nash?: (?non-executive), (? independent)
Company Secretary: G J O?Connor johnoc@winhold.co.za (Fax +27 11 345 9881)
Sponsor: Arbor Capital Sponsors Proprietary Limited
Date: 25/11/2016 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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