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Sekunjalo Investments Ltd-
and further cautionary announcement
Sekunjalo Investments Limited
(Incorporated in the Republic of South Africa)
Registration Number 1996/006093/06
Share Code: SKJ ISIN: ZAE000017893
("Sekunjalo")
Interim Results for the Period Ended 28 February 2003
HIGHLIGHTS
Group Headline Earnings 31%
Group Turnover 16%
Headline EPS 31%
GROUP INCOME STATEMENT
Unaudited Unaudited
6 months 6 months Audited
Group Group Group
to 28 Feb 2003 to 28 Feb 2002 to 31 Aug 2002
R"000 R"000 R"000
Revenue 176 801 151 788 346 013
Operating income 12 754 10 398 49 207
Finance cost (9 258) (9 478) (24 781)
Profit before tax 3 496 920 24 426
Taxation (1 362) (136) (11 317)
Income after tax 2 134 784 13 109
Income from associates - 26 4 219
Income 2 134 810 17 328
Minority shareholders
interest (798) 293 (407)
Net Income for the period 1 336 1 103 16 921
Headline earnings
Attributable income 1 336 1 103 16 921
Goodwill written off/
Amortisation of dossiers 468 274 1 246
Profit on disposal of
property, plant and
equipment - - (1 562)
Loss on permanent diminution
of investment property - - 35
Loss on write-off of
investments - - 109
Development costs written
off - - 169
Headline earnings 1 804 1 377 16 918
Number of shares in issue 88 688 848 88 688 848 88 688 848
Headline earnings per share
(cents) 2.03 1.55 19.08
Earnings per share (cents) 1.51 1.24 19.08
Diluted earnings per share
(cents) 1.47 1.22 18.68
GROUP STATEMENT OF CHANGES IN EQUITY FOR THE PERIOD ENDED 28 FEBRUARY 2003
Non-
Share Share Distributable Accumulated
Capital Premium Reserves Profit/(Loss) Total
R"000 R"000 R"000 R"000 R"000
Balance at 31 August
2001 1 554 126 283 39 (122 510) 5 366
Net profit from
ordinary
activities - - - 1 103 1 103
Balance at
28 February 2002 1 554 126 283 39 (121 407) 6 469
Net profit from
ordinary
activities - - - 1 336 1 336
Balance at
28 February 2003 1 554 126 283 39 (120 071) 7 805
GROUP BALANCE SHEET
Unaudited Unaudited
6 months 6 months Audited
Group Group Group
to 28 Feb 2003 to 28 Feb 2002 to 31 Aug 2002
R"000 R"000 R"000
ASSETS
Non-current assets 133 338 135 940 140 925
Property, plant and
equipment 66 916 64 837 64 746
Goodwill and intangible
assets 15 895 21 696 19 051
Pharmaceutical dossiers 29 750 31 450 30 600
Investments (incl.
Associate co"s) 6 250 9 744 12 741
Loans receivable 2 486 4 381 6 293
Deferred taxation 12 041 3 832 7 494
Current assets 159 505 129 409 162 516
Inventories 47 508 45 707 43 174
Trade and other receivables 59 084 55 508 62 921
Bank and cash on hand 52 913 28 194 56 421
TOTAL ASSETS 292 843 265 349 303 441
EQUITY and LIABILITIES
Capital and Reserves
Issued capital 127 837 127 837 127 837
Non-distributable reserves 39 39 39
Accumulated loss (120 071) (121 406) (106 176)
7 805 6 470 21 700
Non-current liabilities
Interest-bearing borrowings 109 157 93 113 88 430
Non interest-bearing
borrowings 1 842 22 468 449
Minority shareholders
interest 52 540 49 910 46 251
Current liabilities 121 499 93 388 146 611
Trade and other payables 76 424 63 057 91 981
Bank overdraft 41 140 29 269 40 592
Receiver of revenue 3 935 1 062 14 038
TOTAL EQUITY and LIABILITIES 292 843 265 349 303 441
ABRIDGED CASH FLOW STATEMENT FOR THE PERIOD ENDED 28 FEBRUARY 2003
Unaudited Unaudited Audited
6 months 6 months 12 months
to 28 Feb 2003 to 28 Feb 2002 to 31 Aug 2002
R"000 R"000 R"000
Cash Flows From Operating
activities (17 913) (12 924) 32 372
Cash Utilised By Investing
activities (14 552) (13 638) (16 055)
Cash Flows From Financing
activities 28 409 31 491 5 516
Net (decrease)/increase in
cash and cash equivalents (4 056) 4 929 21 833
Cash and cash equivalents
at beginning of year 15 829 (6 004) (6 004)
Cash and cash equivalents
at end of year 11 773 (1 075) 15 829
OVERVIEW
Sekunjalo Investments Limited has produced a favourable set of interim results
for the period ended 28 February 2003. The interim results have been prepared on
the historical cost basis in accordance with South African Statements of
Generally Accepted Accounting Practice. Accounting policies, which have been
applied, are consistent in all material respects with those applied in the
previous year.
Group turnover for the six-month period increased by 16% from R151,78 million to
R176,80 million; Operating income increased from R10,39 million to R12,75
million; Headline earnings per share is up from 1,55 cents to 2,03 cents. The
improved performance is due to the growth model and restructuring which the
group has implemented.
GROUP PROFILE
Sekunjalo Investments Limited is a black-owned and controlled investment holding
company, which listed on the JSE Securities Exchange SA in May 1999. It manages
and controls its investments in Health Care, Information Technology and
Industrial (primarily fishing) sectors.
Sekunjalo Health Care (SHC) is the largest empowerment health care company in
South Africa. Its core focus is the manufacture and distribution of branded
medical consumables.
Within the Industrial portfolio, Premier Fishing is the largest BEE fishing
company in South Africa. It is competitive in the lobster, pelagic and squid
markets, locally and internationally.
Sekunjalo"s information technology interest in Health System Technologies (HST)
is in a niche area, with synergies between HST and the health care businesses.
REVIEW OF INVESTMENTS
Sekunjalo Health Care (SHC)
SHC has undergone a major restructuring which has included the streamlining of
management to improve operational efficiencies and obtain optimal returns.
The health care environment remains extremely competitive with limited financial
support extended to BEE health care companies. This has constrained the growth
of SHC and its ability to compete effectively in the market place. The sale of
certain subsidiaries is under consideration, with a view to refocusing SHC on
the pharmaceutical businesses.
Sekpharma (Pty) Ltd
Sekpharma continues to build on its relationship with multinational companies.
This has provided Sekpharma with a solid base to increase its market share in
pharmaceutical distribution.
Promex
Promex continues to be the dominant supplier of syringes and needles in the
public sector.
Rapimed
Rapimed continues to obtain contracts in the public sector for diagnostic
consumables.
Sekunjalo Information Technology
Health System Technologies (HST)
Subsequent to the successful implementation of the first phase of the Health
Information System (HIS) in the Western Cape Provincial Health department, HST
has been awarded additional contracts by the Department, which has contributed
to the positive performance of HST.
Sekunjalo Industrials
Premier Fishing
Premier Fishing has performed favourably. The company continues to export to
Asia, Europe and the USA. It has also focused on building strong local brands
such as Pecks Anchovette, Redro and Seagro and has significantly increased its
market share. The investment in an abalone aquaculture farm has benefited the
company through increased exports.
PROSPECTS
The Group anticipates challenging trading conditions in the second half of the
financial year due to the stronger Rand and the outbreak of the Severe Acute
Respiratory Syndrome (SARS) epidemic in Asia, which will adversely affect our
fishing subsidiary. This is likely to have a detrimental impact on second half
earnings.
The recent award by the BusinessMap Foundation to Sekunjalo of the "Top BEE
Market Performer 2003" is a timeous acknowledgement of the resilience and
performance of Sekunjalo. The award has reinforced the commitment of management
and staff to raising performance levels within the Group to face the challenges
that lie ahead.
Sekunjalo is still actively pursuing the recovery of a substantial portion of
its investment in LeisureNet. Shareholders will be kept informed about this
initiative.
FURTHER CAUTIONARY
Further to the cautionary announcement dated 8 April 2003, shareholders are
advised that the negotiations referred to therein are continuing. As these
negotiations may have an effect on the price at which Sekunjalo shares trade on
the JSE Securities Exchange SA, shareholders are advised to continue to exercise
caution when dealing in their Sekunjalo shares until a further announcement is
made.
By order of the Board
Dr WA Mgoqi Dr MI Surve Cape Town
Chairman Chief Executive 21 May 2003
Directors
Dr WA Mgoqi (Chairman), Dr MI Surve* (Chief Executive Officer), Ferhad Kahn
CA(SA) (Financial Director), MY Kajee CA(SA) (Company Secretary), AJ Snyders, KC
Patel, ZA Kota, D Case * Executive Directors
Sponsor
Sasfin Corporate Finance
A Division of Sasfin Bank Limited
Registered Address
70 Rosmead Avenue
Kenilworth 7700
Transfer Secretaries
Computershare Investor Services Limited
70 Marshall Street
Johannesburg, 2001
Date: 21/05/2003 12:35:53 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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