| Fri 22 Nov 2002, 9:12 | | Supersport International: Interim Report |
|
Supersport International: Interim Report
Release Date: 22/11/2002 07:07:47 Code(s): MNS
SUPERSPORT INTERNATIONAL: INTERIM REPORT
SuperSport International Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/004203/06)
Share code MNS ISIN ZAE000014304
("SuperSport" or "the group")
INTERIM REPORT
Group results for the six months ended 30 September 2002 were as follows:
ABRIDGED INCOME STATEMENT
Six months ended Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
(reviewed) (reviewed) (audited)
R`m R`m R`m
Revenue 476 372 839
Cost of sales and provision of services 377 293 609
Gross profit 99 79 230
Operating costs 48 37 150
Operating profit 51 42 80
Net finance income 8 4 13
Profit before taxation and exceptional item 59 46 93
Exceptional item (176) - -
(Loss)/profit before taxation (117) 46 93
Taxation 18 14 31
Net (loss)/profit for period (135) 32 62
Headline earnings per share (cents)
- basic 17,2 12,6 22,6
- diluted 17,0 12,5 22,4
Earnings per share (cents)
- basic (53,4) 12,0 23,3
- diluted (53,0) 11,9 23,1
Dividend per share (cents) - - 5,0
Number of shares used to compute earnings
and headline earnings per share (million)
- basic 253 268 266
- diluted 255 270 268
ABRIDGED BALANCE SHEET
30 Sept 30 Sept 31 March
2002 2001 2002
(reviewed) (reviewed) (audited)
R`m R`m R`m
ASSETS
Non-current assets
Property, plant and equipment 29 37 34
Investments and loans 268 446 444
297 483 478
Current assets 345 244 412
Net cash 55 24 36
Total assets 697 751 926
EQUITY AND LIABILITIES
Capital and reserves 398 564 533
Non-current liabilities
Deferred taxation 62 44 65
Current liabilities 237 143 328
Total equity and liabilities 697 751 926
ABRIDGED CASH FLOW STATEMENT
Six months ended Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
(reviewed) (reviewed) (audited)
R`m R`m R`m
Operating profit 51 42 80
Depreciation and other non-cash items 2 2 (5)
Amortisation of intangible assets 3 1 5
Net working capital (33) (34) 6
Cash generated from operating activities 23 11 86
Net finance income 8 4 13
Taxation paid (12) (29) (45)
Dividend paid - - (13)
Cash flow from operations 19 (14) 41
Utilised for: Property, plant and equipment - (10) (4)
Share buy-back, cancellation and
treasury shares - - (48)
Investments - 9 8
Net cash flow 19 (15) (3)
Net cash at beginning of period 36 39 39
Net cash at end of period 55 24 36
STATEMENT OF CHANGES IN EQUITY
FOR THE SIX MONTHS ENDED 30 September 2002
Share Total
Capital capital
and share Retained and
premium earnings reserves
R`m R`m R`m
Balance at 1 April 2001 397 135 532
Net profit for period - 62 62
Dividend paid - (13) (13)
Treasury stock (1) - (1)
Acquisition of shares held as treasury shares (2) - (2)
Share cancellation and buy-back (45) - (45)
Balance at 31 March 2002 349 184 533
Balance at 1 April 2001 397 135 532
Net profit for period - 32 32
Balance at 30 September 2001 397 167 564
Balance at 1 April 2002 349 184 533
Net loss for period - (135) (135)
Balance at 30 September 2002 349 49 398
SUPPLEMENTARY INFORMATION
Six months ended Year ended
30 Sept 30 Sept 31 March
2002 2001 2002
(reviewed) (reviewed) (audited)
R`m R`m R`m
Included in operating profit:
Depreciation for period 2 1 1
Provision for losses against associates
and joint ventures - 1 (6)
Amortisation of intangible assets 3 1 5
Net finance income: 8 4 13
- Interest received 11 4 14
- Interest paid 3 - 1
Rental under operating leases:
- Office buildings 1 - 2
Exceptional item comprises:
Impairment of listed investment 176 - -
Headline earnings are reconciled
as follows:
Net (loss)/profit for period (135) 32 62
Adjusted for:
Impairment of listed investment 176 - -
Amortisation of intangible assets 3 1 5
Provision for losses against associates
and joint ventures - 1 (6)
Headline earnings 44 34 61
Investments and loans 268 446 444
Investments
Listed shares at market value
(cost in prior years) 216 392 392
Loans
Joint ventures 5 5 6
Associates 47 49 46
Related-party transactions
The transactions with related parties
are summarised as follows:
Affiliates
Subscriber revenues received for period 338 307 674
The balances of receivables and payables
between the group and related parties are:
Receivables
Affiliates 64 47 54
Joint ventures 6 7 4
Payables
Affiliates 1 2 -
Joint ventures 1 - -
Capital expenditure for period - 10 4
Capital expenditure committed or authorised - 1 1
Sports events rights commitments 1 233 1 180 1 277
Number of ordinary shares in issue (millions) 268 283 268
Net asset value per share (cents) 148,4 199,3 198,6
Rand/naira exchange rate at
30 September 2002: R1:00 = N12,47
NOTES:
1. These consolidated condensed interim financial statements for SuperSport for
the six months ended 30 September 2002 were prepared in accordance with AC 127
Interim Financial Reporting.
The accounting policies used in the preparation of the interim financial
statements are consistent with those used in the annual financial statements for
the period to 31 March 2002, except for the depreciation of the buildings of
Centurion Park Investments (Proprietary) Limited.
Centurion Park Investments (Proprietary) Limited, which forms part of the group
results, has changed its accounting policy with regard to depreciation on
buildings to conform with new statements of Generally Accepted Accounting
Practice in South Africa. Buildings will now be depreciated over 50 years. The
comparative amounts have not been restated, as the impact on the prior year`s
figures is not material.
2. Segmental information
SuperSport is involved in the acquisition, packaging, scheduling and
broadcasting of sports and sports-related programming and related advertising
activities, and has interests in various sports operations. SuperSport has no
separable operations and, from a geographical standpoint, although it broadcasts
outside South Africa, its operations are conducted from South Africa.
INTRODUCTION
SuperSport shares trade as indivisible units with those of Electronic Media
Network Limited (M-Net) on the JSE Securities Exchange South Africa and the
Nigerian Stock Exchange, and will continue to do so for the foreseeable future.
SuperSport provides subscribers with top sporting events, broadcasting more than
100 different sporting codes. It recently created a new pan-African sports
channel (SuperSport 3), focusing mainly on soccer, athletics and boxing. During
the period under review the channel broadcast the Soccer World Cup and the
Commonwealth Games, as well as local and international soccer and boxing.
RESULTS
Revenues for the six-month period ended 30 September 2002 amounted to R476
million (2001: R372 million). SuperSport presently holds 3,25 million shares in
MIH Limited. This investment was recorded at a cost of R392 million in the
company`s financial statements. At 19 November 2002, the market value of this
investment based on the current share price was R216 million. The board believes
it prudent to write down the carrying cost of this investment to market value,
resulting in an impairment charge in the income statement of R176 million. In
terms of a proposed reorganisation, SuperSport`s investment in MIH Limited will
be converted to 11,4 million shares in Naspers Limited. Once this proposed
reorganisation is concluded, which is anticipated before the end of December
2002, the board will determine its future strategy regarding this investment. As
a consequence, taxed losses after accounting for the exceptional item amounted
to R135 million, compared with R32 million profit for the same period last year.
Headline earnings per share amounted to 17,2 cents for the six months ended 30
September 2002 (2001: 12,6 cents). Rigorous cost control, together with firm
advertising income and the effects of the share buy-back, contributed to the
growth in earnings per share.
Subscriptions remain the major source of revenue, with advertising and
sponsorships as secondary sources.
Group results include the proportionately consolidated results of Oracle
Airtime Sales (Proprietary) Limited, Griqualand West Rugby Stadium (Proprietary)
Limited, Centurion Park Investments (Proprietary) Limited, KwaZulu-Natal Cricket
(Proprietary) Limited and Western Province Professional Cricket (Proprietary)
Limited.
DIVIDEND
SuperSport`s policy is to pay a single dividend at the end of each financial
year.
PROSPECTS AND DEVELOPMENTS
The group is well-positioned to lead in sports broadcasting on the continent
of Africa. SuperSport is involved in the acquisition, packaging and scheduling
of various pan-African sports channels. It plans to develop and expand its sub-
Saharan initiatives, with emphasis on West Africa.
SuperSport now broadcasts nine sports channels, of which SuperSport 1, 2 and
3 are broadcast 24 hours a day, seven days a week. SuperSport 1 is a dedicated
rugby and golf channel, SuperSport 2 caters for cricket, tennis and motor-sport
enthusiasts, SuperSport 3 screens primarily soccer, boxing and athletics, and
SuperSport 4 is used as a highlights and rebroadcast channel. Digital television
makes the creation of additional channels for the duration of a particular
sports event possible and the SuperSport 5, 6, 7, 8 and 9 channels are used for
this purpose.
The costs of sports rights across the world have been spiralling over the
past decade, often to unaffordable heights. This trend may now slow down, with
Kirch Media in Germany, ITV Digital in the United Kingdom and Alpha Digital in
Greece all recently having collapsed under the weight of this burden. SuperSport
finds itself in the invidious position of having to manage these increasing
costs, coupled with the declining rand, and remains vulnerable to the
fluctuations in the value of the local currency. However, it continues to hedge
its foreign currency exposure to reduce risk in this regard.
A regulatory enquiry into sports of national interest is currently under way.
The outcome of this enquiry may have an effect on the income of local sports
bodies and the prospects of SuperSport in future.
CORPORATE GOVERNANCE
SuperSport is committed to the principles of openness, integrity and
accountability, as advocated in the King Report on Corporate Governance for
South Africa 2002 (King II). The directors recognise the need to conduct the
business of the enterprise with integrity and in accordance with generally
accepted corporate practices. Accordingly, the board has reviewed King II and
the requisite improvements to SuperSport`s corporate governance procedures and
policies are in the process of being implemented.
SuperSport`s auditors, PricewaterhouseCoopers Inc., have reviewed the
abridged consolidated financial information for the six months ended 30
September 2002. The review opinion is available for inspection at SuperSport`s
registered office during business hours.
CHANGE IN DIRECTORATE
Ms Salukazi Dakile-Hlongwane was appointed as a director of SuperSport with
effect from 11 October 2002.
On behalf of the board
Khulu Sibiya Heinrich Enslin
Chairman Chief executive
21 November 2002
Transfer secretaries:
Computeshare Investor Services Limited
70 Marshall Street
Cnr Sauer Street
Johannesburg 2001
(PO Box 1053, South Africa
Johannesburg 2000)
Registered office:
11 Grove Street
RANDBURG 2194
(PO Box 4950, Randburg 2125)
South Africa
Registrars/Transfer
secretaries in Nigeria:
City Securities Limited
5th Floor, Primrose Tower
17 Tinabu Street
LAGOS, Nigeria
(PO Box 9117,
Lagos, Nigeria)
http://www.supersport.co.za
Directors: KB Sibiya (chairman), DDB Band, JP Bekker, JS Craib,
S Dakile-Hlongwane, HR Enslin, PM Jenkins, GP Marques,
JRD Modise, ACG Molusi, VB Mona, KD Moroka, SJZ Pacak,
CJ Sidego, JJ Volkwyn, T Vosloo
Alternate directors: MJ Ledwaba, SF Ward (British)
Company secretary: G Kisbey-Green
Date: 22/11/2002 07:07:44 AM Produced by the JSE SENS Department
