| Tue 13 Aug 2002, 0:00 | | Control Instruments Group Limited - Interim Result |
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Control Instruments Group Limited - Interim Results For The Six Months Ended 30
June 2002
Control Instruments Group Limited
(Incorporated in the Republic of South Africa)
Registration number 1964/003987/06
Alpha code CNL
SIN code ZAE000001665
(Control Instruments or the Group)
- Revenue up 15,7% to R153,9 million
- Profit from operations up 327,8% to R9,3 million
- Headline earnings up 221,6% to R6,4 million
- Interim dividend one cent per share
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2002
COMMENTARY
OVERVIEW
The Group recorded good results for the six months ended 30 June 2002, with the
continued trend of strong turnover growth resulting in a significant improvement
in profitability.
The Group`s focus on supplying specialised electronic hardware and software
products to the automotive industry is creating excellent opportunities.
These opportunities arise out of:
- South Africa`s successful Motor Industry Development Program (MIDP) and the
stated intention of the world`s motor manufacturers to increase their vehicle
and component supplies out of South Africa;
- the increased use of electronic systems in motor vehicles and;
- the increased integration of electronic hardware and software solutions in
vehicle and fleet management applications.
The Group continued to invest in the expansion of its manufacturing facilities.
Further investments are planned during the remainder of the year in additional
equipment and expanded engineering resources.
The acquisition and integration of the Audio Navigation (AN) business acquired
from Siemens VDO was completed during the period under review with minimum
disruption. This has brought CI Automotive Trading (CI-AT) in line with Siemens
VDO`s worldwide trading structure and is contributing to profitability.
Further disposals of non-core assets were made. The Group disposed of its
interest in Rhomberg Electronics (Pty) Limited for US$1 million. The first
$700 000 was received in July 2002 and the balance of $300 000 will be paid in
two equal instalments on 1 May 2003 and 1 November 2003. This transaction has
not been accounted for in these results.
The Group has retained a 50% interest in Aquapay (Pty) Limited, which owns the
technical rights in respect of pre-paid water metering technology.
The Group also disposed of the business of SAN People (Pty) Limited to
management, but will retain a preference shareholding equivalent to 49% in the
new company. The Group`s future funding obligations in respect of this business
are limited to R750 000. This has been provided for in full in the results for
the period under review.
RESULTS
Turnover grew by 15,7% to R153,87 million compared with the same period in 2001.
Operating income increased by R13,68 million, from a loss of R2,36 million to an
operating profit of R11,32 million and net profit before tax grew by 413% to
R7,38 million. Net profit after tax increased by 313% to R5,94 million.
An amount of R11,97 million has not been included in the turnover for the period
under review. This amount relates to sales generated by the Audio Navigation
business (purchased from Siemens VDO) from the effective date of the
transaction, 1 January 2002, until receipt of approval from the Competitions
Board on 1 April 2002.
Headline earnings increased significantly from a loss of 5,95 cents per share in
the six months ended 30 June 2001 to a profit of 7,23 cents per share in the
current period under review.
Operating expenses were tightly controlled and decreased by 3,8% despite the
significant increase in the level of business.
The Group`s balance sheet remains sound. A relatively small amount of cash
(R4,79 million) was absorbed during the period as a result of:
- the investment in plant and equipment;
- the increased working capital requirements resulting from the increased sales;
- the cost of acquiring the assets and stock of the Audio Navigation business;
- the cost of funding SAN People`s losses prior to its sale.
Accounting Policies
The results for the six months ended 30 June 2002 have been prepared on a basis
consistent with the accounting policies set out in the last Annual Financial
Statements and in accordance with South African Statements of Generally Accepted
Accounting Practice.
PROSPECTS
The Group`s operations are strategically well positioned to benefit from the
increased demand for electronic automotive components and products sourced from
South Africa. The Fleet Management (FM) product platform established by CI Fleet
Management Systems (CI-FMS) should provide further international opportunities
and the expanded range of products resulting from the AN acquisition should
continue to complement CI-AT`s business.
INTERIM DIVIDEND
Notice is hereby given that the board has declared an interim dividend of one
cent per share, in respect of the six months ended 30 June 2002.
The last day to trade cum dividend will be Friday, 30 August 2002. The shares
will commence trading ex dividend as from Monday, 2 September 2002 and the
record date will be Friday, 6 September 2002. The dividend will be paid on
Monday, 9 September 2002.
Share certificates may not be dematerialised or rematerialised between Monday, 2
September 2002 and Friday, 6 September 2002, both days inclusive.
On behalf of the Board of Directors
HV Hefer Chairman
R Friedman Managing Director
13 August 2002
CONSOLIDATED BALANCE SHEET
at 30 June 2002
30/6/2002 30/6/2001 31/12/2001
R 000 R 000 R 000
ASSETS
Non-current assets 76 053 63 935 69 685
Property, plant and equipment 37 696 29 285 33 133
Intangible assets 11 715 9 940 13 157
Other non-current assets 26 626 24 710 23 379
Deferred tax 16 - 16
Current assets 107 345 112 579 85 505
Inventories 33 837 30 399 25 436
Receivables and prepayments 49 542 41 206 44 288
Proceeds on sale of investments - 30 000 -
South African Revenue Services - - 177
Cash and cash equivalents 23 966 10 974 15 604
Total assets 183 398 176 514 155 190
EQUITY AND LIABILITIES
Capital and reserves 77 998 82 833 72 058
Minority interest - 5 -
Non-current liabilities 14 822 18 692 14 296
Current liabilities 90 578 74 984 68 836
Trade payables, provisions and
current borrowings 62 980 52 157 54 386
Bank overdraft 27 598 22 827 14 450
Total equity and liabilities 183 398 176 514 155 190
Net asset value
per share (Rand) 0,88 0,94 0,81
CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 30 June 2002
6 months 6 months 12 months
ended ended ended
30/6/2002 30/6/2001 31/12/2001
R 000 R 000 R 000
CASH FLOWS FROM
OPERATING ACTIVITIES
Operating profit before interest
and working capital changes 14 536 2 012 6 820
Working capital changes (6 587) (879) 7 711
Cash generated from operations 7 949 1 133 14 531
Interest paid (1 908) (1 309) (2 953)
Tax received/(paid) 177 - (125)
Utilisation of maintenance reserve - - (251)
6 218 (176) 11 202
CASH FLOWS FROM
INVESTING ACTIVITIES
Purchase of property, plant,
equipment and intangible assets (9 144) (5 306) (19 909)
Disposal of fixed assets 589 - -
Proceeds from sale of assets,
investments and operations - 1 024 29 251
Increase in investments and
non-current receivables (2 975) - (8 799)
(11 530) (4 282) 543
CASH FLOWS FROM
FINANCING ACTIVITIES
Increase/(decrease) in long-term
borrowings 526 133 (3 063)
Net cash (outflow)/inflow for
the period (4 786) (4 325) 8 682
Cash and cash equivalents at the
beginning of the period 1 154 (7 528) (7 528)
Cash and cash equivalents at the
end of the period (3 632) (11 853) 1 154
CONSOLIDATED INCOME STATEMENT
for the six months ended 30 June 2002
6 months 6 months 12 months
ended ended ended
30/6/2002 30/6/2001 % 31/12/2001
Notes R 000 R 000 variance R 000
Revenue 153 871 132 950 15.7 260 770
Continuing operations 1 153 221 122 137 243 005
Discontinuing
operations 650 10 813 17 765
Cost of sales (101 534) (88 308) (169 259)
Gross profit 52 337 44 642 17.2 91 511
Continuing operations 51 932 39 611 82 200
Discontinuing operations 405 5 031 9 311
Other operating income 7 624 3 557 11 514
59 961 48 199 103 025
Operating expenses (48 638) (50 559) 3.8 (101 557)
Continuing operations (46 551) (38 322) (79 655)
Discontinuing operations (2 087) (12 237) (21 902)
Profit/(loss) from
operations before
amortisation, interest
and tax 2 11 323 (2 360) 579.8 1 468
Continuing operations 12 970 4 746 14 014
Discontinuing operations (1 647) (7 106) (12 546)
Amortisation (2 037) (1 717) (4 066)
Profit/(loss) from
operations 9 286 (4 077) (2 598)
Profit on the sale
of investments anf
discontinued operations - 15 318 4 224
Exceptional items 3 - (8 419) (6 630)
Net interest (1 908) (1 309) (2 953)
Loss from associates - (75) -
Profit/(loss) before tax 7 378 1 438 413.1 (7 957)
Tax (1 438) - (1 447)
Net profit/(loss) from
ordinary activities 5 940 1 438 313.1 (9 404)
Weighted average
number of shares
in issue (000) 88 486 88 486 88 486
EPS (cents) 6.71 1.63 313.1 (10.63)
Headline earnings/
(loss) (R 000) 6 402 (5 264) 221.6 (5 893)
Headline EPS (cents) 4 7.23 (5.95) 221.6 (6.66)
Dividend per
share (cents) 5 1.00 - -
Notes to the income statement
1 R11.97 million has been excluded from revenue for the six months
ended 30 June 2002. This amount relates to sales generated by the
Audio Navigation business (purchased from Siemens VDO) from the
effective date of the transaction, 1 January 2002, until receipt
of approval from the Competitions Board on 1 April 2002.
2 Profit/(loss) from operations is stated after taking into account
the following:
Profit/(loss) on
sale of fixed assets 4 - (23)
Depreciation 3 196 4 289 7 346
3 The exceptional items are made up as follows:
Write-off of
foreign loan - 6 236 -
Impairment of intangible
assets and goodwill - 2 183 3 200
Restructuring costs - - 1 253
Provision against
investment and loans - - 2 177
- 8 419 6 630
4 Reconciliation of EPS to Headline EPS
EPS(cents) 6.71 1.63 (10.63)
Profit on sale of investment and
discontinued operations - (17.31) (4.77)
Exceptional items - 9.51 7.50
Profit/(loss) on
disposal of fixed assets - - 0.03
Goodwill amortised 0.52 0.22 1.22
Headline EPS (cents) 7.23 (5.95) (6.66)
5 Dividend per share
Interim
One cent per
ordinary share 885 - -
The dividend was declared after the Interim balance sheet date on
13 August 2002.
STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2002
Share Share Retained
capital premium Reserves earnings Total
R 000 R 000 R 000 R 000 R 000
Balance at
1 January 2001 4 424 47 603 105 29 269 81 401
Currency
translation
differences (6) (6)
Net profit 1 438 1 438
Balance at
30 June 2001 4 424 47 603 99 30 707 82 833
Currency
translation
differences 71 (4) 67
Arising during the year 322 322
Joint venture previously
not consolidated (4) (4)
Utilisation of
maintenance reserve (251) (251)
Net loss (10 842) (10 842)
Balance at
31 December 2001 4 424 47 603 170 19 861 72 058
Net profit 5 940 5 940
Balance at 3
0 June 2002 4 424 47 603 170 25 801 77 998
CONTROL INSTRUMENTS GROUP LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1964/003987/06
ALPHA code : CNL ISINcode : ZAE000001665
Directors: HV Hefer (Chairman)* R Friedman (Managing)
EPH Bieber* SV Bromfield* TE Buzer (British) RB Forrester
RJ Fraenkel JR Hersov* *non-executive
Registered Office:
The Vineyard GroundFloor East Wing Corner Adam Tas and Devon Valley Roads -
Stellenbosch 7600 PO Box 114 Franschhoek 7690
Share Transfer Secretaries:
Computershare Investor Services Limited 11 Diagonal Street Johannesburg 2001 -
PO Box 1053 Johannesburg 2000THESE RESULTS, THE GROUP`S PRESENTATION TO
ANALYSTS AND LINKS TO THE GROUP`S SUBSIDIARIES ARE AVAILABLE AT: www.ci.co.za
Date: 13/08/2002 02:11:25 PM Produced by the JSE SENS Department
