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Sweets From Heaven Holdings Ltd - Interim Results For The Six Months Ended 31
Release Date: 27/11/2002 16:58:08 Code(s): HVN
Sweets From Heaven Holdings Ltd - Interim Results for the six months ended 31
August 2002
ISIN: ZAE000011045
Share code: HVN
Chairman`s Report
Commentary
Importantly, these interim results and the events following it, endorse the
recovery which began last year and open new horizons for the group. As has been
our mission, within the constraints of a small cap company, we have concentrated
on mainly two key areas of the business.
Firstly in improving our core operations and secondly by strengthening our
balance
sheet - a process which culminated subsequent to the conclusion of this interim
reporting period. Patience, passion, focus and dedication has enabled the group
in most part to achieve both milestones.
The upswing shown at year-end February 2002 results has continued into these
results. Whilst turnover remained on par with last years first half, profit
from operations rose to
R 708 000 from R 557 000 in the same period last year which represents a 27%
increase. Interest paid reduced by 24% in the current year. Headline earnings
for the period were up by 52 % to R 570 000, compared to the previous R 376 000.
Net earnings rose 267% from R 190 000 in 2001 to R 507 000 at end August 2002.
This translated into both a Headline and Group earnings per share of 0.71 cents
and 0.64 cents respectively for the period, compared to the 0.47 cents and 0.24
cents for the same period last year.
Post August 2002
A new consortium, headed by myself as C.E.O, has been formed subsequent to these
results. The purpose is to purchase the existing long term debt and a
significant amount of equity in the HEAVEN business. Of the total R13.7 Million
of long term debt reflected on the Balance Sheet, R 9.6 Million was purchased on
the 26th November 2002, with an agreement in principle to conclude the balance
of R 4.1 Million before end November 2002. The debt will be subordinated on
terms no less favorable than those currently in place.
Included in this repurchase by the consortium was 26.5 % of equity or 21.4
Million ordinary shares, effective 27 November 2002, at no extra dilution to the
total number of shares currently in issue.
Into the Future.
U.K
As stated above the way has been cleared for the future potential upside of the
group to gain momentum. Complimenting this is the fact that our hitherto one
store successful operation in the U.K. is set to expand. Our company in the UK
has entered into a joint venture (partnership)with a successful U.K.
entrepreneur to open further outlets in the U.K. The first scheduled to open
mid December 2002 and the second in April 2003, both in major regional shopping
malls. Subject to the proven performance of these two new outlets, further
Heaven stores are envisaged opening in the UK via a combination of company owned
and franchised outlets. After operating successfully for over 2 years in the
U.K, we view this market as a potentially lucrative one to our future strategy
for growth.
South Africa
The second six months is traditionally the better half of our trading period.
However the obstacles imposed by way of a combination of higher interest rates
and other factors, lend a degree of caution to any such forecast.
Realistically looking ahead much of the above depends on a mix of events, some
in our hands and others beyond. We have every intention of giving, as always
only of our best in achieving our goals and look forward with a degree of hard
earned optimism to our future and remain receptive to opportunities that may
come our way.
The commitment shown by senior management by increasing their direct investment
in the business is testimony to this.
On behalf of the board
Laurie Davidoff Chairman/CEO
Greg Ginsberg Financial Director
27th November 2002
Consolidated Income Statement
For the six months ended 31 August
2002
2002 2001 2002
Unaudite Unaudite Audited
d d
6 months 6 months 12
months
August August February
R`000 R`000 R`000
Gross Revenue 19,171 19,137 36,484
Profit from operations 708 557 853
Net interest paid -138 -181 -501
Taxation 0 0 692
Headline earnings 570 376 1044
Exceptional items -63 -186 -639
Net Earnings for the period (cents) 507 190 405
Headline Earnings per share (cents) 0.71 0.47 1.31
Earnings per share (cents) 0.64 0.24 0.51
Shares in issue (000`s) 79,795 79,795 79,795
Weighted number of shares in issue 79,795 79,795 79,795
(000`s)
Consolidated Balance Sheet
as per 31 August 2002
2002 2001 2002
Unaudite Unaudite Audited
d d
6 months 6 months 12
months
August August February
R`000 R`000 R`000
Assets
Non-current assets 7,690 9,319 8,008
Fixed Assets 3,566 5,407 3,974
Employee share incentive scheme 53 38 53
Investments 4,071 3,874 3,981
Current Assets 4,616 3,131 4,704
Inventories 1,351 1,548 1,641
Trade and other receivables 2,746 1,396 2,394
Cash and cash equivalents 519 187 669
Total assets 12,306 12,450 12,712
Equity and liabilities
Capital and reserves 2,354 1,628 1,847
Issued capital 20,213 20,213 20,213
Accumulated loss -26,226 -26,949 -26,733
Subordinated interest free 8,364 8,364 8,364
shareholders loans
Non distributable reserve 3 0 3
Non-current liabilities 4,766 5,128 4,806
Interest-bearing borrowings 1,978 2,306 2,018
Non interest-bearing borrowings 2,788 2,822 2,788
Current liabilities 5,186 5,694 6,059
Non-interest bearing borrowings 2,672 2,250 3,817
Interest bearing borrowings 2,514 3,444 2,242
Total equity and liabilities 12,306 12,450 12,712
Reconciliation between earnings and
headline earnings
2002
R`000
Earnings for the period 507
Exceptional items - legal fees 63
Headline earnings 570
Statement of changes in Equity
For the six month period ended 31
August 2002
Subordinated Share Share Accumulated
Loans NDR Capita Premium Loss Total
l
R`000 R`000 R`000 R`000 R`000 R`000
Balance at 01 8364 3 798 19415 -26733 1847
March 2002
Net earnings 0 0 0 0 507 507
for the year
Balance at 31 8364 3 798 19415 -26226 2354
August 2002
Abridged Cash
Flow
Statement
For the six
month period
ended 31
August 2002
2002
R`000
Cash flow 557
from
operating
activities
Cash flow -667
from
investing
activities
Cash flow -40
from
financing
activities
Net increase -150
in cash and
cash
equivalents
Cash and cash -1,253
equivalents
at beginning
of the year
Cash and cash -1,403
equivalents
at end of the
year
Accounting
Policies
These interim
statements
have been
prepared in
accordance
with AC127 on
accounting
interim
financial
statements.
The financial
statements of
the group
comply in all
material
respects with
South African
Standards of
Generally
Accepted
Accounting
Practice and
are
consistent
with those
applied
in the
previous
financial
year.
Date: 27/11/2002 04:58:07 PM Produced by the JSE SENS Department
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