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Quyn -
2003 and Further Cautionary Announcement
Quyn Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/012245/06)
("Quyn")
(Share code: QUY ISIN code: ZAE000017257)
Reviewed preliminary results for the seventeen months ended 28 February 2003 and
cautionary announcement
ABRIDGED GROUP INCOME STATEMENT
- 28 February 2003
28 February 30 September
2003 2001
(R 000"s) Notes (reviewed) (audited)
Revenue 130 535 89 531
Operating income/(loss) before 1 10 468 (4 074)
interest
Abnormal items 2 - (5 882)
Net interest received/(paid) (8 165) (9 292)
Operating income/(loss) 2 303 (19 248)
Profit on sale of subsidiary - 721
Income/(loss) before taxation 2 303 (18 527)
Taxation (1 770) (975)
Income/(loss) after taxation 533 (19 502)
Share of associated companies"
net income/(loss) (280) (52)
Income/(loss) attributable to
ordinary shareholders 253 (19 554)
Notes to group income statement
1. Operating income/(loss) before
interest is stated after:
Depreciation 2 879 1 970
Amortisation of goodwill and 655 428
intangibles
Operating lease payments 6 678 5 543
(Profit)/loss on disposal of property,
equipment and vehicles 43 20
(Profit)/loss on foreign currency 198 794
translation
2. Abnormal items:
- Write-down of inventory to net
realisable value before tax - (3 658)
- Write-down of deposit paid on
contract
before tax - (2 224)
- (5 882)
For purposes of calculating earnings
per share and headline earnings per
share these items have been included
in attributable profit.
ABRIDGED GROUP CASH FLOW STATEMENT
- 28 February 2003
28 February 30 September
2003 2001
(R 000"s) (reviewed) (audited)
Cash generated (utilised) by (38 422)
operations
Cash flows from investing activities
Proceeds on sale of subsidies
- net cash forgone 18 462
Acquisition of goodwill and (516)
intangibles
Proceeds on sale of property,
equipment
and vehicles 1 049
Acquisition of property, equipment
and vehicles (4 161)
Other (468)
Net cash outflow from investing - 14 366
activities
Cash flows from financing activities
Redemption of preference shares -
Shares repurchased -
Long-term liabilities raised 31 046
Long-term liabilities repaid (5 502)
Net cash inflow from financing
Activities - 25 544
Net increase in cash and cash - 1 488
equivalents
Cash and cash equivalents at the
beginning of the period (8 090)
Cash and cash equivalents at the
end of the period - (6 602)
ABRIDGED GROUP STATEMENT OF CHANGES IN EQUITY
for the seventeen months ended 28 February 2003
28 February 30 September
2003 2001
(R 000"s) (reviewed) (audited)
Balance at beginning of period 21 755 48 430
Cancellation of shares (476) -
Shares purchased by subsidiary (1 126) -
Redemption of preference shares (46) -
Income/(loss) attributable to
ordinary shareholders 253 (19 554)
Reversal of deferred tax asset - (7 250)
Prior year adjustment 2 841 -
Other movements - 129
Balance at end of period 23 201 21 755
ABRIDGED GROUP BALANCE SHEET
as at 28 February 2003
28 February 30 September
2003 2001
(R 000"s) (reviewed) (audited)
ASSETS
Non-current assets
Property, equipment and vehicles 31 834 39 875
Land and development costs - 11 167
Goodwill and intangibles 65 964
Investments 4 959 2 978
Loans to joint ventures 2 308 3 240
Deferred taxation 141 535
39 307 58 759
Current assets
Land and development costs 18 135 81 412
Accounts receivable 33 094 26 176
Bank balances and cash 2 981 14 703
54 210 122 291
Total assets 93 517 181 050
EQUITY AND LIABILITIES
Share capital and reserves 23 201 21 755
Non-current liabilities
Long term liabilities 20 940 35 002
Negative goodwill 4 376 4 686
Provision for onerous contracts 936 3 882
26 252 43 570
Current liabilities
Current portion of long-term - 56 213
liabilities
Provision for onerous contracts 222 375
Short-term loans 1 853 14 197
Accounts payable and taxation 33 966 23 635
Bank overdraft 8 023 21 305
44 064 115 725
Total equity and liabilities 93 517 181 050
SUPPLEMENTARY INFORMATION
as at 28 February 2003
28 February 30 September
2003 2001
(R 000"s) (reviewed) (audited)
Number of ordinary shares in issue
- end of year (000"s) 63 086 72 391
Number of ordinary shares in issue
- beginning of year (000"s) 72 391 72 391
Conversion of preference shares 784 -
Less: Shares repurchased and cancelled (3 167) -
Less: Held by subsidiary (6 922) -
Weighted average 69 021 73 175
Number of convertible redeemable
shares in issue - end of year (000"s) - 5 366
Profit/(loss) per share (cents) 0,4 (27,0)
Plus: Amortisation of goodwill 1,0 0,7
Profit on sale of fixed assets - -
Profit on sale of investments - (1,0)
Write-down of investments - 0,3
Headline profit/(loss) per share 1,4 (27,0)
(cents)
Ordinary dividends per share (cents) - -
Preference dividends per share (cents) - -
Net asset value per share (cents) 36,8 30,1
Net tangible asset value per share 43,6 35,2
(cents)
Contingent liabilities 48 644 192 105
Capital commitments 16 483 26 496
Review
The above results, which have been prepared in accordance with South African
Statements of Generally Accepted Accounting Practice ("GAAP") have been reviewed
but not audited by BDO Spencer Steward (Johannesburg) Inc. and are available for
inspection at the Company"s registered offices.
COMMENTARY
The group recorded a profit before taxation of R2,3 million in the seventeen
months reported on compared to a loss of R19 million in the previous financial
year. The disposal of non-core property assets has succeeded in reducing group
debt by R80 million.
Review of operations and segmental results
Operating income/(loss) before taxation has been incurred by the group"s
divisions as follows:
17 months Year
ended ended
28 February 30 September
R000"s 2003 2001
Colliers Property division 6 007 (15 173)
Quyn Outsource division (968) 1 714
Holding company (2 237) (3 427)
Foreign operations (499) (2 362)
2 303 (19 248
Colliers property services division
Property management
This division is steadily growing its client base to a level where the division
will benefit from economies of scale and attain the desired profitability level.
Broking
The operations of this division have remained steady over the past 17 months.
With the recent appointment of a broker manager and a number of experienced
brokers, indications are that this division will perform according to
expectations
Developments
The lack of funding within Colliers, as a result of the previous high levels of
debt within the group, has prohibited this division from embarking on new
developments over the past 30 months. Prospects currently under review indicate
that this division could be making a contribution in the future.
Quyn Outsource division
The payroll administration division has seen slightly higher than expected
attrition during the period but has maintained a steady core of clients and is
set for expansion. Financial Services has performed better than expected and
looks set for further growth in the year ahead. The two labour broking companies
have suffered from a first quarter seasonal downturn but have concluded new
contracts, the financial effects of which will only filter through into the next
period. This area of the group is expected to return to profitability in the
next period.
Foreign operations
Mozambique has shown steady growth during the period under review and prospects
look good for the future. The group remains committed to its investment in
Mozambique.
This operation is expected to benefit from an upturn in the regional economy in
the future.
Directors
Mr Bernard Kaiser has been appointed as Financial Director of Quyn Holdings
Limited and Mr Shaun Cairns as non-executive chairman.
Detailed Cautionary
The directors of Quyn propose to proceed with the termination of the listing of
Quyn"s shares on the JSE Securities Exchange South Africa by way of a repurchase
of securities.
In this regard the company, subject to the passing of the necessary resolution
authorising such repurchase, intends to extend an offer to shareholders in
respect of their shares in Quyn. All shares acquired in terms of the offer will
be cancelled.
In arriving at this decision the directors of Quyn have evaluated the company
and it"s listing and decided that:
* The costs associated with maintaining the listing exceeded the benefits,
which accrue to the company and it shareholders;
* The company would not meet the JSE Listings Requirements in order to retain
its main board listing for a number of years; and
* Whilst enormous effort has been made in restoring the group to positive
earnings it would be a number of years before an earnings level, which warranted
the resumption of divided payments, would be achieved.
The directors intend to apply for a termination of Quyn"s listing simultaneously
with the extension of the aforementioned offer.
An announcement detailing the terms of the offer will be published in due
course.
Shareholders are referred to the cautionary announcement published on 21 May
2003 and are reminded to continue exercising caution in their dealings in Quyn
shares pending the publication of the aforementioned announcement.
Dividend declaration
No dividend has been declared nor is recommended in respect of the period under
review.
For and behalf of the board
RP Fertig
Chief executive officer
17 June 2003
Directors:
SF Cairns (Non-executive chairman),
RP Fertig (CEO), JN Alcock, BW Kaiser,
JA Holland, WP Alcock (Alternate director)
Registered office:
36, Fricker Road, Illovo
Sandton
Transfer secretaries:
Computershare Investor Services Limited
70 Marshall Street
Johannesburg
2001
SPONSOR
KPMG
Date: 17/06/2003 07:00:15 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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