| Thu 13 Feb 2003, 17:02 | | SPECTRUM SHIPPING LIMITED - SPECTRUM SHIPPING ANNU |
|
SPECTRUM SHIPPING LIMITED
(Incorporated in the Republic of South Africa)
Registration Number : 1998/018118/06
Share code : SUM
ISIN : ZAE000037446
Audited Audited
INCOME STATEMENT 2002 2001
R R
Gross billings 628 907 876 255 995
Cost of billings 599 583 283 254 630
Turnover 29 324 593 1 365
Gain on compromise - 6 565 457
settlement
Other income 933 463 -
Operating costs 18 221 549 944 301
Operating profit before 12 036 507 5 622 521
interest & taxation
Interest received 829 288 474
Finance costs (5 114 365) -68
Share of profit of - 1 762 364
Spectrum Shipping
Company
Profit before taxation 7 751 430 7 385 291
Taxation 715 463 2 215 588
Profit after taxation 7 035 967 5 169 703
Earnings per share (cents) 0.8 3.4
Headline earnings per share (cents) 0.8 0.4
Restated comparative earnings per 0.8 1.1
share (cents)
Restated comparative headline 0.8 0.1
earnings per share (cents)
RECONCILIATION BETWEEN
EARNINGS AND HEADLINE
EARNINGS:
Net profit
Profit on 2002 2001
ordinary
activities
Taxation
Per the financial
statements 7 751 430 (715 463) 7 035 967 5 169 703
Gain on compromise
settlement - - - (4 595 820)
Loss on sale of
fixed assets 9 458 (2 837) 6 621 74 200
Timing difference
arising from the
acquisition of logistics - (1 293 269) (1 293 269) -
Goodwill amortisation 965 016 (205 000) 760 016 -
8 725 904 (2 216 569) 6 509 335 648 083
CASH FLOW STATEMENT 2002 2001
R R
Cash flows from operating activities (17 610 362) (630 564)
Cash generated by operating activities 12 372 550 983 313
Interest received 829 288 474
Interest paid (5 114 365) -68
Changes in working capital (25 697 835) (1 614 283)
Cash flows from investing activities (342 873) 271 796
Property, plant and equipment acquired (454 883) -
Proceeds of disposals of property, plant
and equipment - 263 157
Proceeds of disposals of investments - 8 639
Loans receivable repaid 112 010 -
Cash flows from financing activities 548 631 341 362
Capital redeemed (332 634) -
Increase in short term loans 873 730 341 362
Increase in non-current liabilities 7 535 -
Decrease in cash and cash equivalents (17 404 604) (17 406)
Cash and cash equivalents at beginning
of the year 8 994 26 400
(Decrease)/increase in cash equivalents (17 395 610) 8 994
Cash and cash equivalents acquired (9 900 355) -
during the year
Cash and cash equivalents at end of the (27 295 965) 8 994
year
BALANCE SHEET 2002 2001
R R
ASSETS
Non-current assets 6 803 631 5 135 921
Property, plant and equipment 1 092 862 -
Intangible asset 1 316 667 -
Deferred taxation 4 394 102 5 125 421
Employee share trust - 10 500
Current assets 99 035 022 2 146 280
Trade and other receivables 95 564 479 2 137 286
Non-Interest bearing loans 17 340 -
Cash and cash equivalents 3 453 203 8 994
Total assets 105 838 653 7 282 201
EQUITY AND LIABILITIES
Capital and reserves 27 654 177 6 545 843
Issued capital 107 794 530 93 722 163
Accumulated loss (80 140 353) (87 176 320)
Non-current liabilities 52 971 415 502
Shareholders loan - 415 502
Interest bearing borrowing 52 971 -
Current liabilities 78 131 505 320 856
Loan payable 873 730 -
Trade and other payables 44 086 291 320 856
Current portion of borrowings 23 208 -
Bank overdraft 30 749 168 -
Provisions 2 399 108 -
Total equity and liabilities 105 838 653 7 282 201
net asset value per share (cents) 3.3 4.4
net tangigible asset value per change 3.1 4.4
STATEMENT OF CHANGES Share Share Accum
IN EQUITY capital premium loss Total
R R R R
Balance at 01 January 150 000 93 572 163 (91 147 488) 2 574 675
2001
Correction of fundamental - - (1 198 535) (1 198 535)
error
Restated balance 150 000 93 572 163 (92 346 023) 1 376 140
Net profit for the year - - 5 169 703 5 169 703
Balance at 01 January 150 000 93 572 163 (87 176 320) 6 545 843
2002
Net profit for the year - - 7 035 967 7 035 967
Issue of share capital 700 000 13 372 367 - 14 072 367
Balance at 31 December, 850 000 106 944 530 (80 140 353) 27 654 177
2002
REPORT AND OPERATIONAL REVIEW
Management is pleased to announce a set of results which exceed pre-listing
forecasts for the year ended 31 December 2002. The two contributing factors to
the EPS forecast of 0.3 cents (actual 0.8 cents) for the year ended 31 December
2002 being exceeded are the acquisition of the business of CSS Logistics and the
forecast of Spectrum Shipping having been exceeded. We have risen to the
challenge in building shareholder value, since our reverse listing on the JSE
Securities Exchange via the Micrologix Limited vehicle, announced on 18 January
2002, and are confident that we can improve further on this achievement.
Spectrum Shipping`s listed profile has not only lent greater credibility to the
organisation, resulting in the broadening of its customer base, but also
facilitated far better access to funding.
As an independent clearing and forwarding intermediary and service provider to
local importers and exporters, Spectrum Shipping occupies a niche position in
the market with a strong track record and well-diversified client base.
Importers and exporters are offered a full cargo management service for
shipments conducted by sea, air, road and rail. Our core areas of expertise are
in the fruit, textile and timber industries, and we are also well represented in
the clothing, footwear, automotive and wine industries.
Spectrum Shipping has a national infrastructure, with offices in Durban, Port
Elizabeth, Cape Town, and Johannesburg. We are also the exclusive South African
agent to the well known and respected international logistics service company,
Emery Forwarding.
With the focus on profitability and customer satisfaction, we follow a hands-on
approach by ensuring that the company is managed on a decentralised basis, with
regional management retaining rock face responsibility for day-to-day operations
as well as profitability and the growth of the business.
Growing the business is ultimately about growing profits. Initiatives include a
detailed assessment of our clients, to identify where we can develop new avenues
for clients to grow their business with us. An area of concentration is to
improve service levels to our clients.
The acquisition of the business of CSS Logistics in 2002, has not only broadened
our client base by balancing the business activities between the clearing and
forwarding of imports and exports, but it has also extended Spectrum Shipping`s
reach into the Western Cape. Through this acquisition, the company also gained
the highly prized `evergreen` clearing and forwarding contract between Capespan
and CSS Logistics, which was ceded and assigned to Spectrum Shipping in April
2002. This contract has added significant business mass to Spectrum Shipping
since Capespan is one of the leading fruit marketing companies in the world.
Positive and negative goodwill amounting to R1,011 million was written down at
the end of the year, relating to the listed entity acquiring Spectrum Shipping
Company and CSS Logistics.
The rate of taxation of 9% is low in the current year due to a timing difference
arising from the acquisition of CSS Logistics. This is adjusted for in the
headline earnings per share.
The current period cash utilisation reflects the growth in the Company`s trading
and the demand for money with importers trading strongly in the last quarter of
the year. The cash flow cycle improves into the first quarter of the new year.
The financial condition of the company is healthy with reserves of R27.7
million. The equity base also measures up well with a 29% return on average
equity after interest and taxation.
We maintain close contact with our bankers and freight funders, who have backed
us through a particularly good trading period, extending our facilities to match
organic growth.
Macro economic growth forecast for 2003 of around 3% - 4% percent will
undoubtedly benefit the company, and should translate into a nominal growth in
earnings of approximately 20 percent.
Following the acquisition of CSS Logistics, the Durban offices were merged into
a single entity, now located in offices at 54 Winder Street in Durban. The move
has resulted in a major saving in rental, with warehousing facilities now
outsourced.
The Cape Town and Durban finance teams have also been consolidated, with all of
the Company`s 96 personnel members now accessing a common Compu-Clearing system.
We remain focused on maintaining our business, increasing our margins, growing
our customer base and developing our forwarding business. In terms of strategic
positioning, management`s vision for the company is to evolve the business into
a completely comprehensive international logistics solutions provider.
The management of cargo in the supply chain process provides excellent
opportunities for Spectrum Shipping. By developing strategic alliances with
other providers such as freight forwarders and supply chain management
providers, the scope of our services can be significantly broadened.
This will be achieved by buying businesses currently responsible for moving
product and identifying other suitable acquisitions, as well as organically by
providing services such as warehousing and transport solutions.
Spectrum Shipping intends to increase its penetration of the lucrative
Johannesburg market by increasing its exposure to the forwarding industry, and
adding to its existing exporter client base. A stronger presence in this
important inland market will enable us to leverage costs and to strengthen
relationships with vessel owners and road transporters thereby improving
transport and freight rates on behalf of customers.
Black empowerment is very much on Spectrum Shipping`s agenda. Acquisitive
initiatives are underway to attract smaller niche players who generate good
margin business, and who can help facilitate the growth of our business. Once
the shareholding and management structure sufficiently reflects Spectrums Black
empowerment aspirations, Spectrum would like to target the government sector as
this is considered a distinct area of opportunity for the company into the
future.
APPRECIATION
We would like to take this public opportunity to thank our directors, management
and staff for their continued motivation, commitment, and effort throughout the
year. We believe that with our in-depth industry knowledge, skills base and well
trained staff, Spectrum Shipping is ideally positioned to meet the growth
expectations of all stakeholders.
ACCOUNTING POLICIES
The accounts have been prepared in conformity with South African Statements of
Generally Accepted Accounting Practice and on a basis consistent with the prior
year.
DIVIDENDS
In accordance with the board`s current desire to re-invest earnings, a dividend
for the current financial year has not been declared.
TADEK TOMASZEWSKIChief Executive Officer
KARL GRIBNITZChairman
REGISTERED OFFICE AND POSTAL ADDRESS
5th Floor, 54 Winder Street, Durban, 4000P.O. Box 6148, Durban, 4000
TRANSFER SECRETARIES
Computershare Investor Services Limited
70 Marshall Street, Marshalltown, 2107
AUDITORS
Compendium (Pretoria) Incorporated
Results are available for inspection at the registered office.
Directors: T Tomaszewski (CEO), DC Kelly (CFO), R Singh, MR Walwyn,
JP Nel*, KJ Gribnitz*, AAG Nairn*, S Donner*
*Non-executive
Date: 13/02/2003 04:48:00 PM Produced by the JSE SENS Department
