| Wed 22 Oct 2003, 12:16 | | results for the six months ended 31 december 2003 |
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Combined Motor Holdings Limited - Interim report for the six months ended 31
August 2003
Combined Motor Holdings Limited
(Registration number 1965/000270/06)
(Share code: CMH ISIN number: ZAE000001541)
Interim report for the six months ended 31 August 2003
- 11% increase in attributable earnings
- 11% increase in headline earnings
- 19% increase in dividend paid
GROUP FINANCIAL HIGHLIGHTS
6 months 6 months 12 months
31 Aug 31 Aug Incr 28 Feb
2003 2002 % 2003
Turnover (R"000) 1 361 204 1 237 458 10 2 591 397
Operating income before
interest (R"000) 28 150 27 041 4 95 347
Weighted average number of
Shares in issue ("000) 20 386 20 386 - 20 386
Number of shares for dilution
calculation ("000) 20 842 20 642 1 20 725
Headline earnings per share (cents) 83,4 75,3 11 282,8
Fully diluted headline
earnings per share (cents) 81,6 74,3 10 278,2
Attributable earnings per
share (cents) 66,5 60,0 11 246,1
Recommended dividend per
ordinary share (cents) 15,4 14,0 10 68,0
Total assets (R"000) 644 343 558 586 15 725 264
Net tangible asset value
per share (cents) 1 075 863 25 1 055
GROUP INCOME STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
31 Aug 31 Aug 28 Feb
2003 2002 Incr 2003
R"000 R"000 % R"000
Turnover 1 361 204 1 237 458 10 2 591 397
Operating income 28 150 27 041 4 95 347
Net interest paid (3 240) (4 518) (28) (10 097)
Taxation (7 872) (7 162) 10 (27 588)
Minority shareholders" share
of income (32) (20) 60 (11)
Headline earnings 17 006 15 341 11 57 651
Amortisation of goodwill (3 450) (3 110) 11 (7 486)
Earnings attributable to
shareholders 13 556 12 231 11 50 165
Reconciliation of earnings
per share
Headline earnings per share 83,4 75,3 11 282,8
Amortisation of goodwill (16,9) (15,3) 11 (36,7)
Attributable earnings per share 66,5 60,0 11 246,1
GROUP STATEMENT OF CHANGES IN SHARE CAPITAL AND RESERVES
Unaudited Unaudited Audited
6 months 6 months 12 months
31 Aug 31 Aug 28 Feb
2003 2002 2003
R"000 R"000 R"000
At beginning of period 225 500 189 197 189 197
Earnings attributable to shareholders 13 556 12 23 50 165
Dividend paid (13 047) (11 008) (13 862)
At end of period 226 009 190 420 225 500
GROUP CASH FLOW STATEMENT
Unaudited Unaudited Audited
6 months 6 months 12 months
31 Aug 31 Aug 28 Feb
2003 2002 2003
R"000 R"000 R"000
Cash flow from operating activities (31 407) 6 247 34 181
Cash flow from investing activities (2 396) (16 415) (11 119)
Cash flow from financing activities 5 667 (6 714) 3 157
Net cash flow for period (28 136) (16 882) 26 219
Cash and cash equivalents at beginning
of period 149 171 122 952 122 952
Cash and cash equivalents at end of period 121 035 106 070 149 171
GROUP BALANCE SHEET
Unaudited Unaudited Audited
31 Aug 31 Aug 28 Feb
2003 2002 2003
R"000 R"000 R"000
Long-term assets
Fixed assets 17 876 20 704 18 266
Amount owing by share trust 1 497 2 691 2 834
Intangible assets 6 941 14 499 10 391
Deferred taxation 4 365 4 560 4 876
30 679 42 454 36 367
Current assets 613 664 516 132 688 897
Total assets 644 343 558 586 725 264
Equity and liabilities
Total share capital and reserves 226 009 190 420 225 500
Minority shareholders" interest 469 260 437
Total shareholders" funding 226 478 190 680 225 937
Current liabilities 417 865 367 906 499 327
644 343 558 586 725 264
SEGMENTAL ANALYSIS
Car hire/
Retail financial
Total motor services
R"000 R"000 R"000
Turnover 1 361 204 1 313 338 47 866
Operating income before taxation 24 910 23 676 1 234
Total assets 644 343 458 196 186 147
Total liabilities 417 865 312 982 104 883
COMMENTS ON RESULTS
1. Particularly tough trading conditions were experienced during the six months
under review. Despite the stronger rand, which helped to minimise vehicle price
increases, the high interest rates had an adverse effect on new vehicle sales,
most notable in the luxury segment of the market. Used vehicle trading also came
under pressure. During periods when new vehicle prices are rising, used vehicle
values retain a greater portion of their original cost price. When new vehicle
prices stabilise, used vehicles tend to devalue more rapidly. This necessitates
a downward adjustment to the values of stock on hand and a reappraisal of trade-
in values. The Group"s parts and service divisions continued to produce sound
results.
2. The car hire division, National/Alamo Car Hire, endured a slow start to the
period following the sharp decline in international tourism at the start of the
Iraq war and the outbreak of the SARS virus. Trading levels are now above the
corresponding levels of 2002 and it is expected that the full year results will
reflect an improvement.
3. Financial services continued to show increasing returns. Both finance joint
ventures have offset their initial start-up costs and are reflecting steadily
rising monthly income. The Group has a significant balance of cash on hand and
the return on this investment is evident in the 28% reduction in the net
interest charge. Approximately R30 million of cash resources was used during the
year to effect early repayment of interest-bearing car hire creditors. This is
reflected in the cash flow report as a reduction in cash from operating
activities.
4. All things considered the directors are satisfied with the reported results.
Looking to the balance of the financial year, it is expected that the recent
reductions in the prime lending rate and the possibility of further cuts in the
near future, will have a positive impact on trading levels. Forward bookings in
the car hire division and signs of improved levels of consumer confidence in the
retail motor segment suggest a more buoyant environment. During the period the
Group opened a new Honda dealership in Menlyn, and gained a stronger foothold
in the Greater Durban market following the acquisition of two Ford dealerships,
in Durban and Umhlanga Rocks. A Delta dealership in Boksburg has recently been
purchased and a second, together with a Chevrolet outlet, is on track for
November. During October the Group opened its second Peugeot branch, in Cape
Town, and a third, in Centurion, will commence operations during November.
5. An interim dividend (dividend number 33) of 15,4 cents per share will be paid
on 15 December 2003 to members reflected in the share register of the Company at
the close of business on the record date (12 December 2003). Last day to trade
"cum" dividend is 5 December 2003. First day to trade "ex" dividend is 8
December 2003. Share certificates may not be dematerialized /rematerialised
between 8 December 2003 to 12 December 2003, both days inclusive.
6. The interim report has been compiled in accordance with South African
Statements of Generally Accepted Accounting Practices, and the accounting
policies are consistent with those used in previous years. The Group is
committed to maintaining the high standards of governance as embodied in the
King Report on Corporate Governance and complies with the significant principles
of both the Report and the JSE Securities Exchange listing requirements. The
report has not been audited or reviewed by the Company"s auditors.
By order of the Board of Directors
SK Jackson BCom (Hons) (Tax Law), CA(SA)
Secretary
22 October 2003
Registered office
1st Floor
CMH Building
206 West Street
Durban, 4001
Transfer secretaries
Computershare Limited
PO Box 61051
Marshalltown, 2107
Sponsor
PricewaterhouseCoopers
Corporate Finance (Pty) Limited
Private Bag X36
Sunninghill, 2157
Directors
M Zimmerman (Chairman), JD McIntosh (Managing), MPD Conway, JTM Edwards, SK
Jackson,
RTAC Nethercott, CL Odendaal, A Rogoff
Date: 22/10/2003 12:00:08 PM Produced by the JSE SENS Department
