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New Clicks Holdings Limited - ISSUE OF AUDITED ANNUAL FINANCIAL STATEMENTS
New Clicks Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1996/000645/06)
JSE share code: NCL
ISIN: ZAE000014585
("New Clicks")
ISSUE OF AUDITED ANNUAL FINANCIAL STATEMENTS
Further to the New Clicks reviewed preliminary results for the year ended 31
August 2003, shareholders are advised that the annual financial statements will
be dispatched to shareholders on 24 December 2003. The annual financial
statements will also be available online on the New Clicks website
(www.newclicks.co.za) on 24 December 2003.
There were some small modifications to the reviewed preliminary results which
were published on 16 October 2003. These modifications are summarised below,
and the abridged annual financial statements are set out below.
The annual financial statements were audited by New Clicks" auditors, KPMG Inc.
Their report is available for inspection at the company"s registered office.
MODIFICATIONS TO REVIEWED PRELIMINARY RESULTS
There were no changes to the consolidated income statement or the consolidated
changes in equity statement for 2003 and 2002.
In the consolidated balance sheet for both 2003 and 2002, trademarks have been
separated from property, plant and equipment, and deferred tax assets and
deferred tax liabilities have now been separately disclosed. In addition, in
2003 the taxation prepaid is now separately disclosed and there was a
reallocation of taxation between taxation payable and deferred taxation.
In the consolidated cash flow statement for 2003, there was a correction of the
cash flow on the issue of shares, which was previously disclosed in investing
activities rather than financing activities.
ABRIDGED AUDITED ANNUAL FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENT
Year ended Year ended
31 August 31 August
2003 2002
R"000 R"000 % change
Turnover 7 367 739 5 487 791 34.3
Cost of merchandise 5 576 857 3 932 390
Gross profit 1 790 882 1 555 401 15.1
Other revenue 528 261 424 861
Other expenditure 1 937 140 1 661 702 16.6
Operating profit 382 003 318 560 19.9
Net interest paid (84 117) (67 220) 25.1
Interest paid - normal operations (84 117) (67 220)
Interest accrued - PM&A 59 265 45 525
Provision - PM&A interest (59 265) (45 525)
Net profit after interest 297 886 251 340 18.5
Provision for impairment of loan - (32 475)
Net profit before exceptional items 297 886 218 865 36.1
Exceptional items
Profit on the sale of stores 26 454 -
Goodwill amortised (23 719) (11 346)
Loss on disposal of property, plant
and equipment (2 610) -
Net profit before taxation 298 011 207 519
Taxation 83 743 61 319 36.6
Profit attributable to ordinary
shareholders 214 268 146 200 46.6
Adjustments for
Profit on the sale of stores (18 518) -
Goodwill amortised 23 719 11 346
Loss on disposal of property, plant
and equipment 1 827 -
Headline earnings 221 296 157 546 40.5
Headline earnings per share (cents)
Undiluted 65.6 52.2 25.7
Diluted 64.5 49.7 29.8
Earnings per share (cents)
Undiluted 63.5 48.4 31.2
Diluted 62.5 46.1 35.6
Distribution per share (cents)
Paid - December 14.1 11.2 25.9
Paid - July 10.9 9.9 10.1
Payable - December 15.1
CONSOLIDATED BALANCE SHEET
As at As at
31 August 31 August
2003 2002
R"000 R"000
ASSETS
Non-current assets 1 452 501 1 201 924
Property, plant and equipment 747 263 612 537
Trademarks 4 580 5 230
Goodwill 235 288 182 502
Deferred taxation assets 81 363 69 900
Loans 384 007 331 755
Current assets 2 001 329 1 266 656
Inventories 1 401 061 1 055 137
Accounts receivable 417 305 196 624
Taxation prepaid 3 754 14 895
Cash on hand 179 209 -
Total assets 3 453 830 2 468 580
EQUITY AND LIABILITIES
Capital and reserves
Ordinary shareholders" interest 1 608 510 1 221 757
Non-current liabilities
Long-term liabilities 412 532 230 546
Deferred taxation liabilities 15 252 6 790
Current liabilities 1 417 536 1 009 487
Short-term borrowings 33 005 108 583
Accounts payable 1 373 743 887 542
Taxation payable 10 788 13 362
Total equity and liabilities 3 453 830 2 468 580
CONSOLIDATED CASH FLOW STATEMENT
Year ended Year ended
31 August 31 August
2003 2002
R"000 R"000
Net cash flow from operations 513 820 418 834
Movement in working capital 38 893 (10 705)
Net interest paid (84 117) (67 220)
Taxation paid (87 145) (89 508)
Cash effects of operating activities 381 451 251 401
Distributions to ordinary shareholders (44 243) (37 736)
Net cash effects of operating activities 337 208 213 665
Net cash flow utilised in investing activities (267 501) (310 034)
Net cash effects of financing activities 188 949 717
Net increase/(decrease) in cash and cash equivalents 258 656 (95 652)
CONSOLIDATED CHANGES IN EQUITY
Year ended Year ended
31 August 31 August
2003 2002
R"000 R"000
Increase in share capital and premium 340 187 39 952
(Decrease)/increase in non-distributable reserve (86 097) 83 611
Net profit for the year 214 268 146 200
Distributions to shareholders (81 605) (63 539)
Net increase in shareholders" funds 386 753 206 224
Opening shareholders" interest 1 221 757 1 015 533
Closing shareholders" interest 1 608 510 1 221 757
Percentage increase in closing shareholders" interest 31.7
SEGMENTAL ANALYSIS
The geographical split and split per brand of turnover and profit is as follows:
Year ended Year ended
31 August 31 August
2003 2002 %
R"000 R"000 change
Turnover
Clicks 2 997 226 2 692 620 11.3
Discom 771 441 720 895 7.0
Music division 482 287 439 333 9.8
The Body Shop 45 781 27 161 68.6
Link Investment Trust 19 919 16 175 23.1
United Pharmaceutical Distributors 1 431 304 -
Southern African operations 5 747 958 3 896 184 47.5
Priceline 1 587 711 1 574 694 0.8
Priceline Pharmacy 17 705 -
House 10 347 16 913 -38.8
Price Attack 4 018 -
Australian operations 1 619 781 1 591 607 1.8
Total 7 367 739 5 487 791 34.3
Operating profit before interest and tax
Clicks 259 281 262 974 -1.4
Discom (5 571) (20 637)
Music Division 25 675 21 470 19.6
The Body Shop 10 017 5 176 93.5
Link Investment Trust (2 712) (2 801)
Intercare (962) (1 764)
United Pharmaceutical Distributors 54 304 -
Shared Services unallocated (7 376) 2 167
Southern African operations 332 656 266 585 24.8
Priceline 124 974 121 758 2.6
Priceline Pharmacy (2 029) -
House 11 548 12 768 -9.6
Price Attack 17 999 (94)
Shared Services (103 145) (82 457)
Australian operations 49 347 51 975 -5.1
Total 382 003 318 560 19.9
NOTE: The Australian shared services costs have not been allocated to the
trading brands as these costs have been stepped up ahead of the planned growth
to support the development of the franchise business model.
IMPACT OF FOREIGN CURRENCY FLUCTUATIONS
The rates of exchange applied in the conversion of the Australian dollar to the
rand are reflected below (rands to the Australian dollar).
2003 2002
Income statement items - average rate
for the year to 31 August 5.11686 5.54883
Balance sheet items - rate at 31 August 4.72438 5.82403
The impact of the exchange rate movement on the group"s performance is reflected
below by restating the turnover and operating profit for the Australian
operations for the current year at the rate applied for the year ended 31 August
2002.
Year ended Year ended
31 August 31 August
2003 2002 %
R"000 R"000 change
Turnover
Southern Africa 5 747 958 3 896 184 47.5
Australia 1 756 524 1 591 607 10.4
7 504 482 5 487 791 36.7
Operating profit before interest and tax
Southern Africa 332 656 266 585 24.8
Australia 53 513 51 975 3.0
386 169 318 560 21.2
SUPPLEMENTARY INFORMATION
Year ended Year ended
31 August 31 August
2003 2002
Number of ordinary shares in issue (`000) 354 118 305 172
Weighted average number of shares in
issue (`000) 337 587 301 772
Weighted average diluted number of shares
in issue (`000) 342 906 317 272
Net asset value per share (cents) 454 400
Net tangible asset value per share(cents) 388 341
Depreciation (R"000) 103 726 97 075
Capital expenditure (R"000) 203 006 158 005
Capital commitments (R"000) 226 966 225 011
NOTES
Accounting policies and restatement of comparatives
These financial statements have been prepared in accordance with South
African Statements of Generally Accepted Accounting Practice, and the accounting
policies used are consistent with those applicable for the 2002 annual financial
statements, other than the changes reflected in the notes below.
1. Loan to Purchase Milton & Associates (PM&A)
PM&A, the pharmacy chain that the group is in the process of acquiring, had a
shareholders" deficit of R176.1 million as at 31 August 2003. The net loan to
PM&A from the group amounted to R295.5 million at the end of August 2003, after
the impairment disclosed at August 2002 and the interest provision explained in
note 2 below. After trading at a loss of R8 million in the six months to
February 2003, PM&A recorded a trading profit of R8 million in the second half
of the year to break even for the year, before the interest charge from the
group. The directors are of the opinion that no further impairment of the loan
is required on the basis of a value in use calculation.
2. Net interest
As PM&A traded at a break even level for the year, the directors have decided to
provide in full for the interest accrued on the loan to PM&A. The comparatives
for the year to August 2002 have been restated to achieve consistency, with part
of the R78 million impairment being allocated as a provision against interest
accrued, and the balance remaining as an impairment.
The effect of this on headline earnings is included in note 3 below.
3. Accounting circular on headline earnings
In line with the new definition of headline earnings, any impairment in respect
of the loan to PM&A must be taken into account in headline earnings. The
comparative figures for the year to August 2002 have been restated in line with
this. The effect of this change for the year to August 2002 is to reduce
headline earnings by R54.6 million and to reduce diluted headline earnings per
share by 17.2 cents.
4. AC133 - Financial instruments: recognition and measurement
The group has adopted this statement with effect from 1 September 2002. There
has been no need to adjust opening reserves, and there is no significant impact
on profit in the current year.
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the eighth annual general meeting of shareholders of
New Clicks will be held at the registered office of the company at the corner of
Searle and Pontac Streets, Cape Town on Monday, 26 January 2004 at 11h00 to
transact businesses as stated on the notice of the annual general meeting
forming part of the annual financial statements.
Registered address:
Cnr Searle and Pontac Streets
Cape Town 8001, PO Box 5142
Cape Town 8000
Directors:
D.M. Nurek (chairman)*, T.C. Honneysett, R.B. Godfrey, E. Osrin*,
J.C. Sher (Australian), P.E.I. Swartz (deputy chairman)*, A. Zimbler*
* non-executive
Transfer Secretaries:
Computershare Limited
70 Marshall Street
Marshalltown
Johannesburg 2001
PO Box 61051
Marshalltown 2107
Sponsor
Investec Securities Limited
Date: 22/12/2003 01:52:08 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
