| Tue 2 Apr 2002, 0:00 | | Cape Empowerment Trust Limited - Preliminary |
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Cape Empowerment Trust Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/014606/06)
JSE Code CAE
ISIN ZAE000016952
("Cape Empowerment Trust")
Preliminary unaudited results for the ten months ended 31 December 2001
BALANCE SHEET
Unaudited Audited
ten months year
ended ended
31-Dec 28-Feb
2001 2001
R'000 R'000
ASSETS
Non-current assets 54,856 41,737
Property, plant and equipment 1,074 868
Unlisted investments 17,796 2,869
Loans receivable 35,986 38,000
Current assets 429 14,278
Accounts receivable 429 14,274
Cash resources - 4
Total assets 55,285 56,015
EQUITY AND LIABILITIES
Capital and reserves 49,674 44,340
Issued share capital and share
premium 116 116
Accumulated profits 49,558 44,224
Non-current liabilities 889 722
Long-term borrowings 889 722
Current liabilities 4,722 10,953
Accounts payable 724 6,730
Bank overdraft 3,760 4,035
Current portion of long-term
obligations 238 188
Total equity and liabilities 55,285 56,015
INCOME STATEMENT
Unaudited Audited
ten months year
ended ended
31-Dec 28-Feb
2001 2001
R'000 R'000
GROSS REVENUE - 43,694
Operating (loss) income (164) 5,087
Net interest paid (210) (982)
(Loss) Income before taxation (374) 4,105
Taxation - 1,870
(Loss) Income after taxation (374) 5,975
Exceptional items 347 19,645
(Loss) Income after exceptional items (27) 25,620
Share of associated companies'
income 5,361 -
Outside shareholders' interest in
subsidiary loss - 847
Net income attributable to ordinary
shareholders 5,334 26,467
Earnings per share (cents) 4.6 22.8
Headline earnings per share (cents) 4.6 5.9
Diluted earnings per share (cents) 4.6 5.9
Net asset value per share (cents) 42.9 38.3
Number of shares in issue during
period ('000) 115,858 115,858
ABRIDGED CASHFLOW STATEMENT
Unaudited Audited
ten months year
ended ended
31-Dec 28-Feb
2001 2001
R'000 R'000
Cashflows from operating
activities 8,024 2,723
Cash generated by operations 8,234 8,394
Investment income 313 892
Finance costs (523) (1,874)
Taxation paid - (4,689)
Cash flows from investing
activities (9,984) 50,596
Property, plant and equipment
acquired (418) (535)
Other investments (9,566) (2,869)
Proceeds on disposal of subsidiaries - 54,000
Cash flows from financing
activities 2,231 (63,334)
Changes in outsider shareholders'
interest - (823)
Changes in long-term borrowings 167 (8,620)
Changes in short-term loans 50 (4,453)
Changes in loans receivables 2,014 (49,438)
Net increase (decrease) in cash
and cash equivalents 271 (10,015)
Cash and cash equivalents
at beginning of year (4,031) 5,984
Cash and cash equivalents
at end of year (3,760) (4,031)
STATEMENT OF CHANGES IN EQUITY
Unaudited Audited
ten months year
ended ended
31-Dec 28-Feb
2001 2001
R'000 R'000
Balance at beginning of period 44,340 17,984
Shares cancelled - -111
Net profit for the period 5,334 26,467
Balance at end of period 49,674 44,340
COMMENTARY
1. Group profile
Cape Empowerment Trust is a holding company with strong empowerment
credentials.
Our philosophy is to purchase companies with good growth prospects to which
we add value and exit to the benefit of shareholders. Notwithstanding the
much publicized Intella transaction, our successes include Federal Guarding,
the reverse listing of Dynamic Cables SA (Pty) Ltd, and arising from the
transformation process under way in the media sector, we are well placed to
benefit as a result of our relationship with B&H Printhouse ("B&H"), as well
as our investment in DDB SA (Pty) Ltd.
We anticipate further development in this direction during the current year.
Furthermore, our interest in the Taxi Industry and Recapitalisation Plan
remain promising.
2. B&H
Our relationship with B&H has proved to be positive and we expect to benefit
from B&H's ability to export at more competitive prices due to the
devaluation of the rand. B&H is currently involved in an initiative to
access markets in Mauritius, The United Kingdom, Botswana and America.
Although volumes are small, the potential to grow remains extremely
positive.
3. The Dynamic Cables group ("Dynamic Cables")
The reverse listing of Dynamic Cables SA (Pty) Ltd was successfully
concluded during the year and Cape Empowerment Trust currently holds
approximately 50 - 55% of Dynamic Cables RSA Limited's equity. It is
anticipated that after the earn-out, our shareholding should increase to
approximately 80% of the Dynamic Cables.
Dynamic Cables has continued to be a solid performer and at our current
shareholding we have benefited to the extent of R4,657 million during the
reported year. This has to be viewed in light of the projected 80%
shareholding of sustainable reportable income which is expected to yield a
favourable growth.
Dynamic Cables comprises of the Cable Business, the Enclosure Business and
the Switchboard Business.
The Cable Business has once again proven to be the major contributor of
Dynamic Cables' earnings and recently renewed key contracts remain in place
and continue to serve this business very well. In the near future this
business will extend its product offering to certain fibre-optic based
products as well as the appropriate connectors. We believe that Dynamic
Cables will eventually earn the bulk of its income from these new products.
The Enclosure Business, "Dynatech", has been bedded down successfully and
has made a small but significant contribution to the current performance.
The Enclosure Business has firm contracts with its major customers for the
next five years and is growing vigorously in a controlled manner.
The Switchboard Business, "MEC", was purchased towards the end of the
financial year out of a liquidated estate for a very modest sum and we are
already in a position to report a forward order book of four months
production. We believe that parastatals seeking empowerment suppliers in
this area will naturally gravitate towards this business and we regard it as
an import-replacement business with good medium-term prospects.
Dynamic Cables has suspended its share trading on the JSE Securities
Exchange South Africa as a result of potential irregularities in the issuing
of shares during the years 1997, 1998 and 1999. The Dynamic Cables
management are currently making good progress in establishing the true facts
behind these possible irregularities and will soon be in a position to
determine whether it is necessary to apply to court to rectify its share
register. Fortunately this has not had a detrimental impact on the trading
position of the company, which remains positive.
4. General
Every effort has been made to reduce the company's indebtedness during the
year under review and our short-term goal is to reduce or eliminate the bank
overdraft.
The ability to sustain a low borrowing base has been achieved by reducing
overheads to the bare minimum.
Shareholders may now expect the group's efforts to move from restructuring
to growing the business units under our control.
On behalf of the Board
S.L. RAI
Group CE
2 April 2002
