| Tue 20 Aug 2002, 0:00 | | Shoprite Holdings Limited - Preliminary Results |
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Shoprite Holdings Limited - Preliminary Results
Shoprite Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1936/07721/06)
ISIN no: ZAE 000012084
JSE share code: SHP
PRELIMINARY RESULTS
For the 12 months ended 30 June 2002
www.shoprite.co.za
Growth in headline earnings per share: 24.7%
Growth in profit after tax: 67.5%
Number of outlets: 598
Group Income Statement
Reviewed Reviewed
12 months to % 12 months to
R`000 30/06/02 change 30/06/01
Revenue 22 109 797 12.8 19 596 729
Operating profit before
exceptional items 522 157 28.4 406 738
Exceptional items 39 287 (74 658)
Operating profit after
exceptional items 561 444 69.1 332 080
Investment income 34 061 29 537
Finance costs 47 465 25 003
Profit before tax 548 040 62.8 336 614
Tax 151 295 51.7 99 735
Profit after tax 396 745 67.5 236 879
Minority interest (8 148) 3 196
Net profit 404 893 73.3 233 683
Headline earnings
per share (cents) 70.7 24.7 56.7
Diluted headline earnings
per share (cents) 70.4 24.2 56.7
Earnings per share (cents)
after exceptional items 78.4 82.3 43.0
Diluted earnings per share
(cents) after exceptional
items 78.0 81.4 43.0
Proposed distribution to
shareholders (cents per share) 25.5 24.4 20.5
Dividend cover (times) 2.8 2.8
Number of ordinary shares
(`000) used for
calculation of
:earnings per share 516 764* 543 479
:diluted earnings per share 519 042*
(* weighted average)
GROUP BALANCE SHEET
Reviewed Reviewed
R`000 30/06/02 30/06/01
ASSETS
Non-current assets 1 746 673 1 489 332
Property, plant and equipment 1 630 835 1 392 196
Investments 115 748 88 174
Deferred tax assets 303 128 381 319
Negative goodwill (303 038) (372 357)
Current assets 4 469 220 4 535 797
Inventories 2 250 278 2 160 958
Trade and other receivables 1 482 791 1 413 019
Cash and cash equivalents 736 151 961 820
Total assets 6 215 893 6 025 129
EQUITY AND LIABILITIES
Capital and reserves 1 459 458 1 444 966
Minority interest 30 714 41 630
Non-current liabilities 236 832 270 365
Interest bearing borrowings 2 450 2 450
Deferred tax liabilities 4 006 4 483
Provisions 230 376 263 432
Current liabilities 4 488 889 4 268 168
Current portion of borrowings - 17 374
Other current liabilities 4 457 659 4 250 794
Bank overdraft 31 230 -
Total equity and liabilities 6 215 893 6 025 129
Reconciliation of Headline Earnings
Reviewed Reviewed
12 months to 12 months to
R`000 30/06/02 30/06/01
Net profit attributable to
Shareholders 404 893 233 683
Exceptional items (39 287) 74 658
(Profit) / loss on disposal
of property (11 139) 5 232
Impairment of buildings 15 469 -
Provision for losses in the
employee share incentive trust - 127 378
Write down of unlisted investment 23 781 5 800
Amortisation of negative goodwill (69 319) (65 314)
Other 1 921 1 562
Tax effect on exceptional items - (450)
Headline earnings 365 606 307 891
GROUP CASH FLOW STATEMENT
Reviewed Reviewed
12 months to 12 months to
R`000 30/06/02 30/06/01
Cash generated by operations 1 033 855 1 041 426
Net (finance costs) /
investment income (14 681) 4 319
Dividends received 1 277 215
Dividends paid (128 705) (102 071)
Tax paid (55 043) (24 658)
Cash flows from operating
Activities 836 703 919 231
Cash flows from investing
activities (622 855) (461 484)
Purchase of property, plant
and equipment (618 549) (475 192)
Proceeds on disposal of property,
plant and equipment 39 572 48 105
Acquisition of further interest
in subsidiaries - (19 994)
Other investment activities (43 878) (14 403)
Net cash flow 213 848 457 747
Cash flows from financing activities (470 747) (46 521)
Proceeds on shares issued by
the Company - 277
Acquisition of treasury shares (453 373) -
Interest bearing borrowings repaid (17 374) (46 798)
Movement in cash and cash equivalents (256 899) 411 226
Acquired through acquisition
of subsidiary - 13 700
Net movement in cash and cash
Equivalents (256 899) 424 926
SEGMENT INFORMATION
Reviewed Reviewed
12 months to 12 months to
R`000 30/06/02 30/06/01
REVENUE - by business segment
- Supermarkets 21 469 405 19 000 529
- Furniture 640 392 596 200*
Total revenue 22 109 797 19 596 729
OPERATING PROFIT - by business segment
- Supermarkets 467 364 361 218
- Furniture 54 793 45 520*
Total operating profit 522 157 406 738
*House & Home, which up to that stage formed part of Hyperama, was placed under
the operational and administrative control of OK Furniture during the second
half of the financial year. As House & Home and Supermarkets operated as a
single business unit, it was not at that point possible to separate their
results in a meaningful way. A complete separation of the different business
units was, however, effected from 1 July 2002 and separate reporting will be
done in future.
SUPPLEMENTARY INFORMATION
Reviewed Reviewed
R`000 30/06/02 30/06/01
1. Capital commitments 160 603 126 446
2. Contingent liabilities 116 225 520 859
Guarantees issued in respect
of debt of the employee
share incentive trust decreased from
R420 million in the
previous year to R60 million currently.
3. Net asset value per share (cents) 287 266
4. Total number of shares in issue 507 761 543 479
STATEMENT OF CHANGES IN EQUITY
Reviewed Reviewed
12 months to 12 months to
R`000 30/06/02 30/06/01
Balance at 1 July
As previously reported 1 422 650 1 293 016
Effect of AC 135 (44 941) (36 833)
Effect of adopting revised AC 107 67 257 58 085
As restated 1 444 966 1 314 268
Issue of shares by the company - 277
Acquisition of treasury shares (274 765) -
Net profit for the period 404 893 233 683
Dividends distributed to shareholders (115 636) (103 262)
Balance at 30 June 1 459 458 1 444 966
COMMENTS ON THE RESULTS
1. During the period under review Shoprite increased revenue by 12.8% to R22,11
billion despite consumer spending coming under pressure due to the rapid
increase in food prices. Timely purchases of large volumes of stock enabled the
group to maintain low prices to the advantage of its customers for some time
after food inflation had increased dramatically.
2. The operating profit of R522,2 million represents an increase of 28.4%
compared with the previous year. The group once again showed exchange surpluses
on its operations outside South Africa. Because of the partial recovery of the
rand against certain currencies the surpluses for the full year were
considerably less than for the first six months.
3. Shoprite`s operations beyond the borders of South Africa are continuing to
grow at a satisfactory rate. In the period under review countries outside South
Africa contributed 10.4% (R2.3 billion) to the group`s turnover as against 8.0%
(R1,6 billion) in 2001.
4. With the great improvement in the results the group began to reap the
benefits of effective management backed by good information and logistic
systems. Productivity was improved significantly and stock losses were further
reduced. The profit margin increased from 2.07% to 2.36%.
5. As the assessed losses were acknowledged as a deferred tax asset, tax is now
fully provided for in the financial statements. However, tax actually payable
comprises mainly tax payable by smaller partnership concerns and secondary tax
on companies.
6. The increase in finance charges was partly due to the purchase of stock
mentioned under point 1 above.
7. The exceptional items consist mainly of the amortisation of negative goodwill
that arose with the take-over of OK Bazaars, of which an amount of R69,3 million
was written back, and a write down of Shoprite`s investment in Canal Walk Ltd by
R23,8 million. The latter company impaired its fixed assets in terms of
accounting statement AC 128 (Impairment).
8. The increase in fixed assets represents investment in new stores, store
renovations and normal asset replacements.
PROSPECTS
The high food inflation is expected to continue in the short term and to keep
consumer spending under pressure. However, the Board expects that the group
should maintain its growth in turnover in at least the first half of the new
year, supported by an increasing contribution from its African interests.
DIVIDEND
The Board has declared a final dividend of 14,5 cents (11 cents in 2001) per
share, payable to shareholders on
16 September 2002. The last day to trade cum dividend will be 6 September 2002.
As from 9 September 2002 all trading of Shoprite Holdings Ltd shares will be ex
dividend. The record date is 13 September 2002.
Share certificates may not be dematerialised or rematerialised between Monday, 9
September 2002 and Friday, 13 September 2002, both days inclusive.
ACCOUNTABILITY
The principle accounting policies adopted in preparing the consolidated
financial statements comply with the South African Statements of Generally
Accepted Accounting Practice and are consistent with those applied for the year
ended 30 June 2001, with the exception of the following:
With the introduction of a new accounting statement (AC 135) buildings are
depreciated in terms of Generally Accepted Accounting Practice. As this
represents a change in accounting policy in terms of AC 103, the carrying values
of
buildings and the related depreciation costs have been restated. The effect on
the group`s results is set out below:
Reviewed Reviewed
12 months to 12 months to
R`000 June 2002 June 2001
Profit before tax 12 274 8 108
Tax - -
Net profit 12 274 8 108
In accordance with the revised accounting statement (AC 107), which relates to
post balance sheet events, the group`s dividends and related secondary tax on
companies (STC) are now recognised on the date of declaration. The comparative
figures in the consolidated financial statements have been restated to reflect
this change in accounting policy.
The effect on the group`s results is set out below:
Reviewed Reviewed
12 months to 12 months to
R`000 June 2002 June 2001
Profit before tax - -
Tax 2 383 1 019
Net profit (2 383) (1 019)
Dividends distributed 13 843 8 153
REVIEW BY INDEPENDENT AUDITORS
The group`s auditors, PricewaterhouseCoopers, have reviewed the preliminary
results. Their unqualified report is available on request from the Company
Secretary.
By order of the Board
C H Wiese J W Basson
Chairman Chief Executive Officer
Date: 20/08/2002 05:05:00 PM Produced by the JSE SENS Department
