| Wed 19 Feb 2003, 17:21 | | BASIL READ HOLDINGS LIMITED - AUDITED RESULTS FOR |
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Basil Read Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1984/007758/06)
("Basil Read" or "the group")
ISIN number: ZAE000029781
Share code: BSR
AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2002
Summarised consolidated income statement Audited Audited
2002 2001
R`000 R`000
Revenue 612,128 594,467
Contract profit / (loss) for the year 31,291 (28,305)
Dividends received 1,043 -
Net finance costs (11,191) (2,483)
Profit / (loss) for the year before taxation 21,143 (30,788)
Taxation (8,392) 16,423
Normal taxation (1,440) (6,399)
Movements in deferred taxation (6,952) 22,822
Profit / (loss) for the year after taxation 12,751 (14,365)
Losses from associates (1,116) -
Minority interests (1) 505
Net profit / (loss) for the year 11,634 (13,860)
Number of shares in issue (`000) 55,100 55,100
Earnings / (loss) per share (cents) 21,11 (25,15)
Headline earnings / (loss) per share (cents) 8,74 (35,56)
Diluted earnings / (loss) per share 20,11 (23,95)
Depreciation for the year (R`000) 24,116 23,348
Reconciliation of basic earnings to headline earnings 11,634 (13,860)
Basic earnings / (loss) (6,821) (5,733)
Adjusted by - profit on sales of property,
plant and equipment (6,821) (5,733)
Headline earnings / (loss) 4,813 (19,593)
Statement of changes in equity Audited Audited
2002 2001
R`000 R`000
Issued capital
Ordinary share capital at beginning and end of year 58,264 58,264
Other reserves
Foreign currency translation reserve
Balance at end of year (4,586) (16,390)
Balance at beginning of year (16,390) 8,058
Movement for the year 11,804 (24,448)
Cash flow hedge reserve
Balance at end of year 15,363 -
Balance at beginning of year - -
Movement for the year 15,363 -
10,777 (16,390)
Accumulated loss
Balance at beginning of year (22,185) (8,325)
Movement for the year 11,634 (13,860)
Balance at end of year (10,551) (22,185)
Total capital and reserves at end of year 58,490 19,689
Summarised consolidated balance sheet Audited Audited
2002 2001
R`000 R`000
ASSETS
Non-current assets 211,332 173,930
Property, plant and equipment 130,511 101,591
Investments and associates 58,862 43,427
Outside shareholders` interests 504 505
Deferred taxation 21,455 28,407
Current assets 271,305 232,118
482,637 406,048
EQUITY & LIABILITIES
Capital & reserves 58,490 19,689
Issued capital 58,264 58,264
Accumulated loss (10,551) (22,185)
Other reserves 10,777 (16,390)
Non-current liabilities 72,913 96,862
Interest bearing borrowings 72,913 39,968
Non-interest bearing borrowings - 56,894
Current liabilities 351,234 289,497
482,637 406,048
Net asset value per share (cents) 106,15 35,73
Capital expenditure for the year (R`000) 73,674 21,803
Summarised consolidated cash flow statement Audited Audited
2002 2001
R`000 R`000
Net cash generated / (utilised) by operations 67,103 (43,271)
Taxation paid (1,706) (7,234)
Dividend received 1,043 _
Net finance costs (11,191) (2,483)
Cash flow from operating activities 55,249 (52,988)
Cash flow from investing activities (63,341) (9,153)
Cash flow from financing activities 12,913 59,958
Movement in cash & cash equivalents 4,821 (2,183)
Cash & cash equivalents at the beginning of the year 58,622 60,805
Cash & cash equivalents at the end of the year 63,443 58,622
Summarised consolidated segment report
Civil
engineering Structures
and opencast and facilities Plant and
Total mining management head office
R`000 R`000 R`000 R`000
Revenue 612,128 426,419 185,709 _
Net profit / (loss) before taxation 21,143 22,158 2,681 (3,696)
Commentary
SALIENT FEATURES
NAV per share up 197%
EPS up 183%
Operating profit up 168%
Cash generated by operating activities up 204%
These results have been compiled in accordance with statements of Generally
Accepted Accounting Practice in South Africa. PricewaterhouseCoopers Inc`s
unmodified audit reports on the 31 December 2002 annual financial statements and
the summarised financial statements contained herein are available for
inspection at the group`s registered office. The same accounting policies and
methods of computation have been used in the preparation of these audited
financial statements as were used in the preparation of the audited financial
statements to 31 December 2001. Certain comparative figures have been changed
for disclosure purposes. The calculation of all headline earnings presented is
based on the interpretation of the Statement of Investment Practice No 1 -
Headline Earnings, issued by the South African Institute of Chartered
Accountants in December 2002.
OVERALL REVIEW
For the year ended December 2002, there has been a substantial turnaround in
contract profit with all divisions posting profits. The group started
operations in 2002 with a clean slate, having reported the final effects of
problematic contracts in the 2001 year. This resulted in a return to profit of
R21,143 million before tax, an improvement on the loss of R30,788 million in
2001.
Contracts awarded for the 2002 year totalled R870 million. At January 2003
further contracts worth R144 million have been secured, taking work in progress
to R604 million. Comparing this figure to that of the same period in 2001, the
group has increased its work in progress by R400 million. Basil Read has also
emerged as the lowest bidder on various contracts totalling around R500 million.
Notably, there was an increase in asset expenditure. This is purely due to the
need to purchase new plant and equipment in support of new contracts. The net
asset value per share has increased by 197% to 106,15 cents (2001: 35,73 cents).
Activity was low in relation to overheads, which can be attributed to the
group`s strategic decision to put the structure in place to facilitate
expansion.
The 2002 year saw an increase in opportunities in the construction sector,
especially in the area of roads. Not only did this result in the group securing
some major projects, but it also afforded Basil Read the opportunity to be more
selective in taking on work. This, coupled with better risk management,
positively influenced the group`s performance in 2002.
OPERATIONAL REVIEW
The Building and Civil Engineering division focused on procuring contracts in
which it could add value - either through various design and engineering
options, alternate financing or longer term facilities management and
maintenance. The group bid on on a number of potential projects, including a
shopping centre in KwaZulu-Natal valued at R200 million. Other opportunities are
being investigated in Botswana, Angola, Mozambique and Namibia.
The road sector saw an increase in activity. Basil Read secured a contract in
Mpumalanga. The company`s economic empowerment partner, BR-Ilima, secured two
road contracts in the Eastern Cape. Activity on these contracts began in the
last quarter of 2002. Basil Read is currently the lowest bidder on several
upcoming road contracts, amongst others one in South Africa and another in
Namibia.
On the mining side, Basil Read successfully implemented the openpit ramp-
scavenging project for the Palabora Mining Company and continued its surface
mining contracts at Eastern Platinum Mine and at Chambishi in Zambia. The group
is furthermore investigating gold, diamond and base metals contract mining
opportunities in Africa.
GOVERNANCE
As an indication of the group`s commitment, corporate governance is a permanent
agenda item at Board meetings. Basil Read endorses the recommendations of the
King Commission and complies with the recommendations in a manner which is
appropriate having regard to the size of the group.
During the period under review, Mr RE Bailey retired and Messrs BW Colledge, G
Mille and I Replumaz resigned and an independent non-executive director, Ms NMJ
Canca, was appointed to the Board, with more independent non-executive
candidates being considered.
Mr A Bernardo continues to act as Chairman and Chief Executive, until such time
that a suitable non-executive candidate for the chairmanship is nominated.
DIVIDENDS
No dividend has been declared for the period.
The Annual General Meeting will be held on 25 April 2003 at Bedfordview.
Shareholders will receive notice of the meeting in due course.
By order of the Board
A BERNARDO
Chairman and Chief Executive
19 February 2003
Directors: A Bernardo (Chairman and Chief Executive); A Brunet*;
NMJ Cancavu; AJ Coy; CJ Gazaignes*; BEG Johansson; JM Kiviatkowski*;
PAR Marien*; HP Maury*; OM Racine* (French *Non-executive uIndependent)
Group Secretary: HJ Power
Registered office: Block D, Gillooly`s View Office Park, 5 Osborne Road,
Bedfordview, 2008
Transfer Secretary: Computershare Investor Services Limited
Sponsor: Bridge Capital Services (Pty) Limited
Auditors: PricewaterhouseCoopers Inc
Date: 19/02/2003 05:15:00 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
