| Mon 5 Aug 2002, 0:00 | | Bell Equipment Limited - Interim Results |
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Bell Equipment Limited - Interim Results
BELL EQUIPMENT
(Incorporated in the Republic of South Africa)
(Registration number 1968/013656/06)
(Share code: BEL ISIN: ZAE000028304)
INTERIM REPORT for the six months ended 30 june 2002
* Revenue up 29% * Net profit for the period up 61% * Net asset value per
share up 30%
Consolidated Balance Sheet
Unaudited Audited
at at at
30 June 30 June 31 December
R`000 2002 2001 2001
ASSETS
Non-current assets 170 356 131 767 156 558
Property, plant and equipment 136 088 108 809 135 475
Investment 23 107 - 11 529
Long-term receivables 11 161 22 958 9 554
Current assets 1 074 915 765 503 1 010 308
Inventory 716 000 515 615 635 838
Trade and other receivables 281 917 223 838 295 478
Current portion of long-term receivables 40 783 - 14 318
Prepayments 24 008 11 500 35 180
Taxation 1 296 1 480 1 871
Cash resources 10 911 13 070 27 623
TOTAL ASSETS 1 245 271 897 270 1 166 866
EQUITY AND LIABILITIES
Capital and reserves 708 494 545 133 661 553
Stated capital (Note 5) 223 401 223 162 223 355
Non-distributable reserves 95 845 53 377 125 518
Retained earnings 389 248 268 594 312 680
Non-current liabilities 31 452 35 966 37 528
Long-term borrowings 22 927 30 391 25 774
Deferred taxation 8 525 5 575 11 754
Current liabilities 505 325 316 171 467 785
Trade and other payables 333 184 237 905 297 027
Current portion of long-term borrowings 5 138 2 296 5 811
Warranty provision 32 505 28 250 23 308
Taxation 31 613 18 380 19 461
Short-term interest bearing debt 102 885 29 340 122 178
TOTAL EQUITY AND LIABILITIES 1 245 271 897 270 1 166 866
Number of shares in issue (000) 93 855 93 763 93 837
Net asset value per share (cents) 755 581 705
Consolidated Income Statement
Unaudited Audited
6 months 12 months
ended ended
Percentage 30 June 30 June 31 December
R`000 change 2002 2001 2001
REVENUE 29 1 106 679 857 787 1 658 096
Cost of sales 23 772 949 627 184 1 228 425
Gross profit 45 333 730 230 603 429 671
Other operating income 36 34 780 25 517 51 269
Distribution costs 34 (168 812) (126 106) (220 809)
Administration expenses 61 (43 823) (27 203) (90 931)
Other operating expenses 40 (21 867) (15 585) (35 905)
Profit from operating activities 54 134 008 87 226 133 295
Net finance costs (Note 2) 25 16 557 13 258 475
Profit before taxation (Note 3) 59 117 451 73 968 132 820
Taxation 52 31 201 20 541 35 341
Net profit for the period 61 86 250 53 427 97 479
Earnings per share (basic) (cents)
(Note 4) 61 92 57 104
Earnings per share (diluted) (cents)
(Note 4) 63 91 56 103
Headline earnings per share (basic)
(cents) (Note 4) 59 92 58 104
Headline earnings per share (diluted)
(cents) (Note 4) 60 91 57 102
Dividend per share (cents) - - - 10
Abbreviated Cash Flow Statement
Unaudited Audited
6 months 12 months
ended ended
30 June 30 June 31 December
R`000 2002 2001 2001
Operating profit before working
capital changes 122 670 103 169 221 226
Cash (invested in)/generated by
working capital (19 272) 34 211 (122 210)
Net finance costs paid (18 393) (14 785) (3 530)
Taxation paid (21 703) (32 922) (41 268)
Net cash from operating activities 63 302 89 673 54 218
Dividend paid (9 385) (9 364) (9 364)
Invested in property, plant, equipment,
investments and long-term receivables (49 698) (25 744) (69 195)
Net cash surplus/(deficit) 4 219 54 565 (24 341)
Proceeds from shares issued 46 340 533
Net (repayment of)/increase in borrowings (4 265) (54 905) 23 808
Cash (surplus applied)/deficit funded (4 219) (54 565) 24 341
Statement of Changes in Equity
Unaudited Audited
6 months 12 months
ended ended
30 June 30 June 31 December
R`000 2002 2001 2001
Equity at the beginning of the period 661 553 496 689 496 689
Effect of change in accounting
policy (Note 1) - (1 176) (1 176)
Restated balance 661 553 495 513 495 513
Changes in share capital 46 340 533
Issue of share capital 46 340 533
Changes in non-distributable reserves (29 673) 5 161 77 302
Realisation of revaluation reserve on
depreciation of buildings (120) (120) (240)
Increase in legal reserve of foreign
Subsidiary 417 64 150
(Decrease)/Increase in foreign currency
translation reserve (29 597) 5 477 79 689
Exchange differences on foreign reserves (373) (260) (2 297)
Changes in retained earnings 76 568 44 119 88 205
Net profit for the period 86 250 53 427 97 479
Transfer from revaluation reserve on
depreciation of buildings 120 120 240
Transfer to legal reserve of
foreign subsidiary (417) (64) (150)
Dividend (9 385) (9 364) (9 364)
Equity at the end of the period 708 494 545 133 661 553
Notes to Interim Report
1. ACCOUNTING POLICIES
The principal accounting policies of the group conform with South African
Statements of Generally Accepted Accounting Practice, and except for the
adoption of AC 135, Investment Property, are consistent with those applied for
the year ended 31 December 2001.
Depreciation is now provided on freehold buildings. Previously, buildings were
not depreciated as they were considered to be investment properties. Comparative
amounts have been restated. The effect of this change is as follows:
Unaudited Audited
6 months 12 months
ended ended
30 June 30 June 31 December
R`000 2002 2001 2001
Reduction in net profit due to increase
in depreciation expense:
Gross 1 151 955 1 909
Tax (331) (254) (509)
Net 820 701 1 400
Restatement of opening retained earnings
in respect of prior year adjustment:
Gross 3 589 1 680 1 680
Tax (1 013) (504) (504)
Effect on equity at the beginning
of the period 2 576 1 176 1 176
Transfer from revaluation reserve (482) (241) (241)
Net 2 094 935 935
2. NET FINANCE COSTS
Net interest paid 10 662 4 346 7 740
Net currency exchange losses/(gains) 7 731 10 439 (4 210)
Net finance costs paid 18 393 14 785 3 530
Financial instrument income (1 836) (1 527) (3 055)
Net finance costs 16 557 13 258 475
Exchange rates used (major currencies):
SA Rand/United States $
- weighted average 10,81 7,92 8,74
- closing 10,21 8,06 12,01
SA Rand/Euro
- weighted average 9,72 7,04 7,77
- closing 10,10 6,85 10,68
3. PROFIT BEFORE TAXATION
Profit before taxation is arrived at
after taking into account:
Income
Export incentives 19 092 13 558 23 912
Net surplus on disposal of property,
plant and equipment 83 - 425
Expenditure
Depreciation of property, plant and equipment 9 518 6 913 15 615
Net loss on disposal of property,
plant and equipment - 970 -
Operating lease charges
- equipment and motor vehicles 2 157 3 720 7 808
- properties 4 701 3 615 8 498
Staff costs 161 205 125 552 259 972
Increase/(Decrease) in warranty provision 9 423 2 843 (2 099)
4. EARNINGS PER SHARE
The calculation of earnings per share is based on profit after taxation and the
weighted average number of ordinary shares in issue during the period. The
weighted average number of shares in issue for the period under review was 93
846 539 (June 2001: 93 715 300).
On a diluted basis, the fully converted weighted average number of shares is 94
977 689 (June 2001: 94 926 650).
Headline earnings is arrived at after taking into account the net surplus/(loss)
on disposal of property, plant and equipment as reflected in Note 3.
5. STATED CAPITAL
Authorised
100 000 000 (December 2001:100 000 000)
ordinary shares of no par value
Issued
93 854 800 (December 2001: 93 837 000)
ordinary shares of no par value 223 401 223 162 223 355
6 CONTINGENT LIABILITIES
6.1 The group has guaranteed the repurchase
of units sold for an amount of 165,407 115,445 144,188
In the event of repurchase, these units, in the opinion of the directors, would
realise at least the value stated above. The risk of a shortfall between
repurchase price and realisable value has been insured.
6.2 An action has been instituted against a subsidiary of the company. As
previously reported, this action is being defended and the continuing view of
the company`s legal advisers is that the company has good grounds for
successfully opposing the claim.
After consideration and based on this legal advice, the Board is satisfied that
the company will not suffer any material loss.
7. COMMITMENTS
Capital expenditure
Authorised, but not contracted 4 865 15 729 17 842
8. Segmental Analysis
Geographical segments
The group operates in two geographical areas:
Operating
R`m Revenue profit Assets Liabilities
June 2002
South Africa 611 129 977 479
Rest of the world 496 5 268 58
Total 1 107 134 1 245 537
June 2001
South Africa 436 68 711 317
Rest of the world 422 19 186 35
Total 858 87 897 352
December 2001
South Africa 927 116 850 292
Rest of the world 731 17 317 213
Total 1 658 133 1 167 505
Assets in South Africa are also used to generate rest of the world revenue.
9. INDEPENDENT AUDITORS` REVIEW
The financial information set out in the interim report has been reviewed, but
not audited, by the company`s auditors, Deloitte & Touche. Their unqualified
review report is available for inspection at the registered office of the
company.
Chairman`s Statement - 30 June 2002
Once again I am pleased to report a record breaking six month trading result.
Net profit from operating activities is up 54% on the comparable period in 2001
resulting in earnings of 92 cents per share (June 2001: 57 cents).
The net asset value has increased by 50 cents per share to R7,55 since the
beginning of the year, despite a dividend of 10 cents being paid in April 2002
and the strengthening Rand, which has reduced the currency translation reserves,
and thereby equity, by R29,6 million (32 cents per share).
Cash flow was positive despite an increase of R49,7 million in fixed assets and
investments and the payment of a R9,4 million dividend. Net working capital
increased by R19,2 million in the period under review in line with the increased
sales volumes, but trade cycle days has improved from 194 days at December 2001
to 150 days at half year. Inventory days at 187 are however higher than budget
and management continues to focus effort on reducing inventory.
The South African market has continued to be strong and the fluctuating exchange
rate has affected the competitiveness of the imported units of our competitors.
Financing charges have increased due to currency exchange losses arising from a
strengthening Euro, and together with higher than budgeted borrowings, has
caused a considerable increase in financing cost as compared with December 2001.
Similarly the strengthening Euro and the purchase of increased componentry out
of Europe as well as offshore operations has increased costs over the same
period in 2001.
The first six months` results are unlikely to be repeated in the next six months
due to the cyclical decreased demand from the Northern Hemisphere.
During the period under review our D-series Articulated Dump Truck worldwide
launch was completed. I am pleased to report that this has been an unequalled
success resulting in increased sales and market share throughout the world. Our
previously reported negotiations with Liebherr for European distribution were
concluded in May 2002. This agreement provides for Liebherr to distribute our
full range of Articulated Dump Trucks under the Bell brand name throughout their
extensive European network of dealers and in-house stores.
For the remainder of 2002, we will continue to ensure we attain higher levels of
quality in our products, lower inventory levels, increased sales outside South
Africa and that we continue to drive our cost reduction and manufacturing
efficiency improvement programme.
H J Buttery
Group Chairman
5 August 2002
Bell Equipment Ltd
(Incorporated in the Republic of South Africa)
(Share code: BEL ISIN: ZAE000028304)
(Registration number 1968/013656/06)
("Bell" or "the company")
Registered office Transfer secretaries
13 - 19 Carbonode Cell Computershare Investor Services Limited
Alton PO Box 1053
Richards Bay 3900 Johannesburg 2000
Directors: G W Bell (Chief Executive), H J Buttery (Chairman), *Dr M W Arnold
(USA), P C Bell, M A Campbell, *M A Guinn (USA), *G P Harris, *P J C Horne, *T D
Kgobe, *J W Kloet (USA), *M O Rysa (Finnish), *D J J Vlok
(*Non-Executive Directors)
Alternate Directors: *C D Anderson (USA), P A Bell, D I Campbell, D B Rhind
Company Secretary: D P Mahony
Date: 05/08/2002 05:10:00 PM Produced by the JSE SENS Department
