| Wed 10 Dec 2003, 16:45 | | Reviewed preliminary report for the year ended 30 |
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Mathomo Group Limited - Reviewed preliminary report for the year ended 30
September 2003 and further cautionary
Mathomo Group Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1995/004783/06)
Share code: MTO ISIN: ZAE000037214
("Mathomo" or "the Company" or "the group")
REVIEWED PRELIMINARY REPORT FOR THE YEAR ENDED 30 SEPTEMBER 2003 AND FURTHER
CAUTIONARY
CONSOLIDATED INCOME STATEMENT
Reviewed Audited
Year ended Year ended
30 September 30 September
2003 2002 Change
R"000 R"000 %
Revenue 271 034 212 502 28
Operating profit before finance costs 21 389 16 120 33
Net finance costs (8 092) (12 117) (33)
Interest paid (6 372) (12 117) (47)
Preference dividend (1 720) -
Net profit before exceptional items 13 297 4 003 232
Exceptional items 197 (12 721)
Net profit/(loss) before taxation 13 494 (8 718)
Taxation (259) (370)
Attributable to ordinary shareholders 13 235 (9 088)
Reconciliation of net profit/(loss) for the
year to headline earnings/(deficit):
Net profit/(loss) for the year 13 235 (9 088)
(Less)/Add back: Exceptional items
excluding the directors" termination
of contract payments (197) 9 647
Headline earnings 13 038 559
Number of shares in issue 47 179 214 47 179 214
Weighted number of shares in issue 47 179 214 26 179 741
Headline earnings per share (cents) 27,6 2,1
Earnings per share (cents) 28,1 (34,7)
ABRIDGED CONSOLIDATED CASH FLOW STATEMENT
Reviewed Audited
Year ended Year ended
30 September 30 September
2003 2002
R"000 R"000
Cash generated from/(utilised in) operating
activities before finance costs 17 093 (6 658)
Finance costs paid (8 092) (12 117)
Cash (utilised in)/generated from investing
activities (835) 4 247
Cash generated from financing activities 1 617 41 145
Net cash inflow for the year 9 783 26 617
Cash and cash equivalents at beginning of the year (34 962) (61 579)
Cash and cash equivalents at end of the year (25 179) (34 962)
SEGMENTAL ANALYSIS
Distribution
of PPE Retail Other Total
R"000 R"000 R"000 R"000
Revenue 2003 201 495 69 539 - 271 034
Revenue 2002 154 931 57 571 - 212 502
Operating profit before finance
cost 2003 16 936 4 735 (282) 21 389
Operating profit before finance
cost 2002 11 198 4 400 522 16 120
CONSOLIDATED BALANCE SHEET
Reviewed Audited
As at As at
30 September 30 September
2003 2002
R"000 R"000
Assets
Non-current assets 16 485 14 363
Property 9 650 9 900
Plant and equipment 6 835 4 463
Current assets 98 289 90 018
Inventories 52 049 46 076
Accounts receivable 46 240 43 942
Total assets 114 774 104 381
Equity and liabilities
Capital and reserves 14 300 1 065
Ordinary share capital 472 472
Share premium 122 763 122 763
Non-distributable reserve ("NDR") 2 325 2 425
Accumulated loss (111 260) (124 595)
Non-current liabilities 34 663 33 631
Interest bearing liabilities 4 663 3 631
Preference shares 30 000 30 000
Current liabilities 65 811 69 685
Accounts payable 39 894 34 570
Bank overdrafts 25 179 34 962
Interest bearing liabilities 738 153
Total equity and liabilities 114 774 104 381
Net asset value per share (cents) 30,3 2,3
ABRIDGED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Reviewed Audited
Year ended Year ended
30 September 30 September
2003 2002
R"000 R"000
Balance at beginning of the year 1 065 (7 008)
Net profit/(loss) for the year 13 235 (9 088)
Ordinary shares issued in terms of the rights offer - 17 554
Write-off of share issue expenses - (393)
Transfer from NDR (100) -
Transfer to retained income 100 -
Balance at end of the year 14 300 1 065
1. Accounting policies
The accounting policies of the group conform to Statements of South African
Generally Accepted Accounting Practice and are consistent with those applied in
the previous year.
2. Trading
Mathomo now consists of:
* Alsafe - a distributor of personal protective equipment and clothing
("PPE");
* Select PPE - an onsite supplier of PPE;
* M Stores - a workplace retailer;
* Select Corporate - a supplier of corporate gifts and apparel.
The divisions all performed exceptionally well in the period under review,
were cash generative and exceeded the operating budgets set at the beginning of
the year. The prospects for Mathomo going forward are positive.
3. Exceptional items
2003 2002
R"000 R"000
Recoveries from previously discontinued operations 197 -
Loss on the sale of MFS - (4 996)
Loss on discontinued operations - (4 619)
Directors" termination of contract payments - (3 074)
Impairment of loan to share incentive trust - (250)
Recovery of losses on Duchini (Pty) Limited - 218
197 (12 721)
4. Taxation
As noted in last year"s annual financial statements Mathomo had gross
estimated tax losses available for set-off against future income of R97,7
million at 30 September 2002. Tax assessments received from SARS to the year
ended 30 September 2001 allowed the losses incurred by Mathomo.
Subsequently these losses have all been re-assessed and disallowed by SARS which
means that the group"s assessed loss as at 30 September 2001 of R88,6 million
has now been reversed. Further, SARS has issued an account which reflects tax
payable of R2,9 million. The directors have sought the advice of legal counsel
and no tax has been provided for in the year under review due to the firm
opinion that no tax is payable.
Due to the uncertainty pertaining to the tax losses no deferred tax asset
has been raised.
5. Debt reduction programme
The debt reduction plan was set out in the Annual Report dated 11 December
2002. Significant success has been achieved in effecting the debt reduction and
the progress is summarised as follows:
* The contingent liability exposure to BRM Marketing (Pty) Limited (in
liquidation) of R630 000 has been expunged.
* The sale of the group"s 42,5% interest in Mathomo Financial Services (Pty)
Limited ("MFS") for R3,5 million was approved by 99,08% of shareholders in
general meeting on 21 February 2003. The cash consideration has been received.
* Due to the strong cash flow recorded by the group in the year under review,
R4 million of preference share capital was redeemed on 17 October 2003.
* The liquidators of Duchini (Pty) Limited have advised Mathomo (as substantial
creditors in the estate) that two settlements in terms of legal actions
instituted by the estate have been reached. Mathomo has as yet not received any
payments from the estate. Initial indications are that a dividend of R1,4
million may be received. This is subject to the confirmation of the Second
Liquidation and Distribution Account. No asset has been raised in the Company"s
records.
* The directors would like to record their appreciation to the capital
providers, The Standard Bank of South Africa Limited ("Standard Bank") and
Mineworkers" Investment Company (Pty) Limited ("MIC"), for the support they have
given Mathomo during this restructuring process.
6. Matomo Group (Pty) Limited
The directors would like to draw attention to a company trading under the
registered name of Matomo Group (Pty) Limited which has received press coverage
of late. A ruling was reached by the Registrar of Company"s on 30 October 2003
ordering Matomo Group (Pty) Limited to change it"s name within 60 days of the
ruling. Matomo Group (Pty) Limited has no bearing and no relation to Mathomo
Group Limited.
7. Renewal of cautionary announcement
Shareholders were advised on 24 October 2003 that MIC is considering
exercising an option, granted by Standard Bank ("the option"), to acquire an
additional 7 128 779 Mathomo shares (the "additional shares") at 50 cents per
share plus an additional amount calculated with reference to the prime rate
reckoned from 18 April 2002 to the date of payment of the option price. These
additional shares, together with the existing shares held by MIC and its
subsidiaries ("the MIC Group"), would result in the MIC Group holding 50,01% of
the entire issued share capital of Mathomo. The option may be exercised at any
time prior to 30 April 2004.
MIC will require the prior approval of the Competition Commission for the
exercise of the option and MIC intends to file a merger notice in this regard.
Should MIC exercise the option it would constitute an affected transaction under
the Securities Regulation Code on Take-overs and Mergers ("the Code") and a
mandatory offer would have to be made unless a dispensation is sought and
granted in terms of Rule 8.1 of the Code.
Accordingly, shareholders are reminded to continue to exercise caution in
their dealings in Mathomo shares until such time as a further announcement has
been made.
8. Review opinion of auditors
The results have been reviewed by the group"s auditors, Fisher Hoffman PKF
(Jhb) Inc. Their unqualified review report is available for inspection at the
Company"s registered office.
By order of the Board
Johannesburg
10 December 2003
Sponsor
JAVACAPITAL
Date: 10/12/2003 04:19:09 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
