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The Tongaat-Hulett Group Ltd - INTERIM RESULTS For The Half-Year Ended 30 June 2
THE TONGAAT-HULETT GROUP LIMITED
Registration No. 1892/000610/06 Share code TNT ISIN ZAE000007449
Interim Results for the half-year ended 30 June 2002
Revenue up 17%
Operating earnings up 25%
Headline earnings up 7%
Headline earnings excluding translation loss up 34%
Interim dividend 80 cents per share
The unaudited results of the Group for the half-year ended 30 June 2002 have bee
INCOME STATEMENT
Rmillion Unaudited Unaudited Audited
Half-year Half-year %change Year ended
30 June 30 June on prior 31 December
2002 2001 half-year 2001
Revenue continuing
operations 2 976 2 552 17 5 121
Continuing operations
Operating earnings 382 306 25 584
Triangle dividend 31 22 76
Net interest paid (63) (55) (75)
Earnings from continuing
operations 350 273 28 585
Exchange rate translation
(loss)/gain (57) 5 255
Discontinued operations (5) (11)
Earnings before
exceptional items 293 273 7 829
Exceptional items 2 (1) (5)
Earnings before tax 295 272 8 824
Tax (70) (55) (196)
Earnings before
exceptional items (70) (60) (206)
Exceptional items 5 10
Earnings after tax 225 217 4 628
Share of associate
companys loss (5) (10) (20)
Minority shareholders
share of loss 1 1
Total net earnings 220 208 6 609
Earnings per share (cents)
Total net earnings
Basic 217,3 206,2 603,4
Diluted 212,9 205,0 597,4
Headline earnings (basic)
Including translation
(loss)/gain 215,4 202,2 7 598,4
Excluding translation
(loss)/gain 265,8 198,2 34 397,3
Dividend per share (cents) 80,0 62,0 29 270,0
HEADLINE EARNINGS
Rmillion
Unaudited Unaudited Audited
Half-year Half-year Year ended
30 June 30 June 31 December
2002 2001 2001
Total net earnings 220 208 609
Add/(less) after tax
effect of:
Surplus on sale of property
held as fixed assets (3) (7) (9)
Surplus on disposal of
subsidiaries (16)
Loss on disposal/closure
of operations 2 7
Goodwill amortised 1 1 3
Impairment of assets 8
Other 2
Headline earnings 218 204 604
Adjustment for translation
loss/(gain) after tax 51 (4) (203)
Headline earnings excluding
translation (loss)/gain 269 200 401
CASH FLOW STATEMENT
Rmillion
Unaudited Unaudited Audited
Half-year Half-year Year ended
30 June 30 June 31 December
2002 2001 2001
Earnings before exceptional
items 293 273 829
Adjustment for exchange rate
translation loss/(gain) 57 (5) (255)
Depreciation 80 76 159
Provisions 16 40
Other non-cash items 7 (9) (31)
Tax payments (23) (9) (19)
Change in working capital (13) (102) 44
Dividends paid (211) (151) (214)
Cash flow from operations 206 73 553
Property, plant and equipment:
New project expenditure (53) (88) (232)
Replacement expenditure (47) (42) (46)
Net proceeds on disposal of
property, plant and equipment 8 9 33
Investments (21) (60)
Disposal of subsidiaries 83 111
Net cash flow 114 14 359
Borrowings (repaid)/raised (246) 34 (242)
Shares issued 6 2 9
Net movement in cash resources (126) 50 126
Cash resources at beginning
of period 1 125 699 699
Exchange rate translation
(loss)/gain (57) 5 255
AC 133 adjustment 4 29 45
Cash resources at end of period 946 783 1 125
BALANCE SHEET
Rmillion
Unaudited Unaudited Audited
Half-year Half-year Year ended
30 June 30 June 31 December
2002 2001 2001
Assets
Property, plant and equipment 4 251 4 191 4 281
Long-term receivable 210 210 210
Investments 51 34 56
Inventories 865 804 859
Accounts receivable 1 532 1 461 1 715
Cash resources 946 783 1 125
Total assets 7 855 7 483 8 246
Equity and liabilities
Shareholders equity 4 478 4 090 4 389
Minority interests in subsidiaries 5 5 5
Deferred tax 990 812 923
Borrowings long and short-term 1 107 1 558 1 502
Provisions 241 185 225
Accounts payable 1 034 833 1 202
Total equity and liabilities 7 855 7 483 8 246
Number of shares (000)
in issue 101 299 100 922 101 125
weighted average 101 221 100 890 100 934
Net asset value per share (cents) 4 421 4 053 4 340
STATEMENT OF CHANGES IN EQUITY
Rmillion
Unaudited Unaudited Audited
Half-year Half-year Year ended
30 June 30 June 31 December
2002 2001 2001
Balance at beginning of period 4 389 3 916 3 916
Effect of changes in
accounting policies 122 122
Restated balance 4 389 4 038 4 038
Total net earnings for the period 220 208 609
Dividends paid (211) (151) (214)
Gains/(losses) from cash flow hedges 59 (41)
Currency exchange rate changes 11 (16)
Gains on available-for-sale assets 4 13
Share capital issued 6 2 9
AC 133 adjustment (7) (2)
Share of associate companys reserves (7)
Balance at end of period 4 478 4 090 4 389
OTHER SALIENT FEATURES
Rmillion
Unaudited Unaudited Audited
Half-year Half-year Year ended
30 June 30 June 31 December
2002 2001 2001
Net debt 161 775 377
Net interest (63) (61) (82)
Interest paid (157) (161) (304)
Financial instrument income 71 60 127
Interest capitalised 13 27
Interest received 23 27 68
comprising: (63) (61) (82)
Continuing operations (63) (55) (75)
Discontinued operations (6) (7)
Capital commitments 179 161 142
Contracted 66 86 75
Approved but not contracted 113 75 67
Operating lease commitments 40 51 40
Guarantees and contingent liabilities 17 35 12
SEGMENTAL ANALYSIS
Rmillion
Unaudited Unaudited Audited
Half-year Half-year % change Year ended
30 June 30 June on prior 31 December
2002 2001 half-year 2001
REVENUE
African Products 678 475 43 1 085
Tongaat-Hulett Sugar 1 503 1 402 7 2 631
Moreland 50 55 (9) 135
Hulett Aluminium (50%) 745 620 20 1 270
Continuing operations 2 976 2 552 17 5 121
Discontinued operations 355 472
Group total 2 976 2 907 2 5 593
EARNINGS BEFORE INTEREST AND TAX
African Products 106 58 83 148
Tongaat-Hulett Sugar 201 195 3 320
Moreland 4 7 (43) 28
Hulett Aluminium (50%) 88 58 52 134
Corporate (17) (12) (46)
Continuing operations 382 306 25 584
Triangle dividend 31 22 41 76
Exchange rate translation
(loss)/gain (57) 5 255
Discontinued operations 1 (4)
Group total 356 334 7 911
Comment on Results
The Group is unlocking substantial value from its recent major investments
with strong operating earnings growth from both African Products and Hulett
Aluminium in the half-year to 30 June 2002.
Revenue from continuing operations increased by 17 percent to R3 billion.
Earnings from continuing operations of R350 million, after dividends received
from Triangle and net interest paid, were 28 percent up on those of the
corresponding period last year. The strengthening of the rand to 30 June 2002
compared to prior year-end levels resulted in a pre-tax loss of R57 million
arising on translation of underlying reserves of 41 million pertaining to
strategic cash resources held abroad. Headline earnings per share were seven
percent up on last year and excluding the translation loss were 34 percent
up. A feature of the period was the strong cash flow that enabled the Group
to reduce net borrowings from R377 million to R161 million. The board has
declared an increased interim dividend of 80 cents per share (2001: 62 cents)
which incorporates a ratio adjustment between the interim and final dividends.
African Products benefited from strong local market growth of 11 percent,
partially driven by customers exports and by import substitution. The
contribution from exports, boosted by the weaker rand, doubled relative to
last year. Average maize input costs are being managed at levels well below
prevailing market prices, substantially reducing the impact on customers of
the extremely high maize prices experienced in South Africa recently. These
factors resulted in African Products achieving growth of 43 percent in revenue
and 83 percent in operating earnings.
Tongaat-Hulett Sugars production in South Africa, Zimbabwe, Mozambique and
Swaziland is forecast to rise to 1,25 million tons in 2002, up 13 percent on
last year. Production from South African operations in the current year is
expected to be approximately 840 000 tons of sugar, compared to last years
actual of 756 000 tons. Realisations in both the local and export markets
have increased compared to last year. Higher cane and sugar production as
well as restructuring in Swaziland and Mozambique are contributing towards
improved earnings. The operation in Zimbabwe has performed as well as can
be expected in a deteriorating socio-economic environment and should produce
280 000 tons of sugar this year, six percent above last years production. The
difficult economic and business environment in Zimbabwe may impact on dividend
receipts in the second half of the year with R31 million having been received
to date.
Morelands signature developments continue to be market leaders and have
established the Umhlanga Ridge as one of the leading property investment
areas in South Africa.
Hulett Aluminium increased revenue by 20 percent to a record R1,5 billion
for the half-year. Earnings before interest and tax for the six-month period
at R176 million were 52 percent ahead of the corresponding period in 2001.
This was achieved under difficult market conditions with international demand
and margins in dollar terms being at their lowest level for many years. The
business is steadily improving its sales mix as it moves up the product
profitability curve, growing its capability to produce products with more
challenging and stringent quality requirements.
It continues to improve its market share in key targeted product groupings
and geographic locations. The Group proportionately consolidates 50 percent
of Hulett Aluminium`s revenue and earnings.
PROSPECTS
The Group remains on track to deliver strong growth in volumes, revenue and
operating earnings. Headline earnings for the year will be significantly
influenced by the relative value of the rand for the remainder of the year.
For and on behalf of the board
C M L Savage P H Staude
Chairman Chief Executive Officer
Amanzimnyama,
Tongaat, KwaZulu-Natal
31 July 2002
DIVIDEND DECLARATION
Notice is hereby given that the board has declared an interim dividend (number
150) of 80 cents per share for the financial year ended 31 December 2002 payable
to shareholders recorded in the register at the close of business on Friday, 23
August 2002.
The salient dates of the declaration and payment of this interim dividend are as
Last date to trade ordinary shares "CUM" dividend
Friday, 16 August 2002
Ordinary shares trade "EX" dividend
Monday, 19 August 2002
Record date Friday, 23 August 2002
Payment date Thursday, 29 August 2002
No dematerialisation or rematerialisation of share certificates may take place
between Monday, 19 August 2002 and Friday, 23 August 2002, both days inclusive.
The dividend is declared in the currency of the Republic of South Africa. Divide
paid by the United Kingdom transfer secretaries will be paid in British currenc
at the rate of exchange ruling at the close of business on Friday, 16 August 200
For and on behalf of the board
M A Kennedy
Group Secretary
Amanzimnyama,
Tongaat,
KwaZulu-Natal
31 July 2002
Date: 31/07/2002 03:23:25 PM Produced by the JSE SENS Department
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