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METAIR INVESTMENTS LIMITED - ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED
31 DECEMBER 2003
METAIR INVESTMENTS LIMITED
(Reg.No. 1948/031013/06)
JSE Share code: MTA
Isin code: ZAE000004743
ABRIDGED AUDITED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2003
ABRIDGED GROUP INCOME STATEMENTS
31 December 31 December
2003 2002
R"000 R"000
Revenue 1,854,208 1,612,836
Cost of sales -1,390,493 -1,238,602
Gross profit 463,715 374,234
Other operating income 14,543 7,060
Distribution, administrative and -238,326 -217,861
other expenses
Operating profit 239,932 163,433
Depreciation and amortisation -41,196 -31,270
Net finance -8,834 -15,109
Profit before taxation 189,902 117,054
Taxation -59,300 -36,627
Profit after taxation 130,602 80,427
Share of results of associates 5,395 7,908
Profit after taxation before 135,997 88,335
minority interest
Minority shareholders" interest -191
Net profit for the year 135,806 88,335
Earnings per share
Basic earnings per share (cents) 2,303 1,512
(Profit)/loss on disposal of -6 27
property,plant and equipment
Headline earnings per share 2,297 1,539
(cents)
Diluted earnings per share
Basic earnings per share (cents) 2,240 1,477
Headline earnings per share 2,234 1,502
(cents)
Dividend per share (cents) 500 455
Weighted number of ordinary shares 5,898 5,841
in issue ("000)
ABRIDGED GROUP CASH FLOW STATEMENTS
31 December 31 December
2003 2002
R"000 R"000
Net cash inflow from operating 203,127 77,283
activities
Net cash outflow from investing -98,641 -83,859
activities
Net cash inflow from financing 6,279 49,099
activities
Increase in cash and cash 110,765 42,523
equivalents
Cash and cash equivalents
At beginning of the year 12,846 -29,677
At end of the year 123,611 12,846
ABRIDGED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share capital Retained Hedging Non- Total
and premium earnings reserve distributable
reserves
R"000 R"000 R"000 R"000 R"000
Balance at 1 34,165 517,400 30,802 582,367
January 2003
Net profit 135,806 135,806
Dividends -29,490 -29,490
Cash flow
hedges
- net fair -4,091 -4,091
value losses
- deferred tax 1,227 1,227
Transfers -1,544 1,544
Balance at 31 34,165 622,172 -2,864 32,346 685,819
December 2003
NOTES TO THE ABRIDGED CONSOLIDATED FINANCIAL STATEMENTS
Accounting Policies
These consolidated abridged audited financial statements are prepared in
accordance with AC127 Interim Financial Reporting and Statements of Generally
Accepted Accounting Practice in South Africa. The accounting policies used in
the preparation of the abridged audited financial statements are consistent with
those used in the annual financial statements for the year ended December 2002,
with the exception of the adoption of AC133 - Financial instruments: Recognition
and Measurement.
Contingencies
The bank and other guarantees given by the Group to third parties amounted to
R45,9 million as at 31 December 2003 (R47,1 million as at 31 December 2002).
Borrowings 31 December 31 December
2003 2002
R"000 R"000
Current 14,694 14,640
Non-current 84,481 78,256
99,175 92,896
The movement in the borrowings can be analysed as follows:
Year ended December 2003
Opening amount -92,896
Repayments 13,721
Amounts raised -20,000
Closing amount -99,175
Fair value adjustments on financial instruments 31 December
2003
R"000
Forward foreign exchange contracts - cash flow hedges -4,091
Forward foreign exchange contracts - fair value -889
hedges
Total -4,980
Annual General Meeting
The annual report will be mailed to shareholders by 31 March 2004 along with the
notice of annual general meeting.
The annual general meeting will be held on 30 April 2004 at 09h00 at Metair
Investments Limited, 10 Anerley Road, Parktown.
Auditors" Report
The abridged results of the Group as set out above have been audited by the
Group"s auditors, PricewaterhouseCoopers.
Their report is available for inspection at the Company"s registered office
(address details as above).
ABRIDGED GROUP BALANCE SHEETS
31 December 31 December
2003 2002
R"000 R"000
ASSETS
Non-current assets 417,461 356,768
Property, plant and equipment 337,940 279,999
Intangible assets 2,528 2,971
Investment in associate companies 34,835 33,351
Deferred taxation 5,861 3,730
Other non-current assets 36,297 36,717
Current assets 610,250 554,804
Inventories 259,607 281,383
Receivables and prepayments 227,032 260,575
Cash and cash equivalents 123,611 12,846
Total assets 1,027,711 911,572
EQUITY AND LIABILITIES
Capital and reserves 685,819 582,367
Share capital and premium 34,165 34,165
Hedging reserve -2,864
Retained earnings and non- 654,518 548,202
distributable reserves
Minority interests 191
Total shareholders" funds 686,010 582,367
Non-current liabilities 109,499 95,356
Interest bearing borrowings 84,481 78,256
Deferred taxation 25,018 17,100
Current liabilities 232,202 233,849
Borrowings 14,694 14,640
Taxation 16,073
Provisions for liabilities and 26,732 24,428
charges
Other current liabilities 174,703 194,781
Total liabilities 341,701 329,205
Total equity and liabilities 1,027,711 911,572
Net asset value per share (cents) 11,631 9,874
Capital expenditure 101,325 85,928
Capital commitments
- contracted 55,051 20,857
- authorised but not contracted 40,721 18,210
Operating Results
The net profit attributable to shareholders was R135,8 million compared to the
R88,3 million achieved in 2002. Headline earnings per share for the full year
were 2297 cents compared to 1539 cents achieved in the previous year.
Total group turnover increased by 15% to R1854,2 million compared to R1612,8
million in 2002. Sales to OE customers increased by 13,2%, exports (direct and
indirect) increased by 30,2%, aftermarket sales by 14,3% and non-automotive
sales declined by 11,8%.
These results were achieved in a year when conditions were again very volatile.
The Rand strength experienced at the end of 2002 accelerated throughout 2003
with a dramatic peak in the last quarter. The reduced pressure on vehicle price
movements together with interest rate reductions of 5,5 percentage points in the
second half of the year influenced sales of new vehicles. Despite the
disappointingly low growth in GDP, sales of passenger vehicles increased by 6,7%
but sales of light commercial vehicles remained unchanged. The stronger Rand did
not immediately impact the volume of vehicles exported, but volumes and
particularly margins of components exported were negatively affected.
Operating profit (before depreciation) increased by 38,3% from R163,4 million in
2002 to R239,9 million. Increased volumes, new business, improved efficiencies
and lower subcomponent costs all contributed to the improvement. Launch costs in
2003 were not as significant as experienced in 2002.
On the Balance Sheet, the increase in the net book value of fixed assets from
R280,0 million to R337,9 million reflects investments made mainly in Land and
Buildings R27,9 million, Plant and Machinery R73,4 million. Despite the turnover
increase of 15,0%, current assets (stock and debtors but excluding cash) reduced
reflecting both tight management control and lower export sales towards year-
end. This together with the improved profitability contributed to the
significant improvement in the net cash position. Finance costs reduced from
R15,1 million to R8,8 million. Shareholders funds represented 66,8% of total
assets at year-end (2002: 64,1%).
Dividend
A dividend of 700 cents per share was declared on 17 March 2004 in respect of
the 2003 financial year.
Outlook
The Group weathered and in some cases benefited from the very volatile
conditions experienced in 2003. The significant investments in new facilities
made in 2001 and early 2002 fully contributed to profitability in 2003. The
continuing instability of the Rand exchange rate makes medium to long term
planning extremely difficult but significant capital commitments have been made
in terms of major new models to be launched in 2005. Whilst volumes of
components sold to vehicle manufacturers are expected to increase, component
prices have been reduced in 2003 as a result of lower imported subcomponent
prices, and the total group turnover in 2004 may show little growth overall.
Exports remain a key area and whilst most of the group"s direct exports are Euro
or Pound denominated and not quite as severely affected as Dollar based exports,
the continued strength of the Rand will curtail export growth and profitability.
Indirect exports also represent a considerable portion of Group turnover and
continued Rand strength may threaten the vehicle export programmes of the
manufacturers in South Africa. A weakening in the Rand exchange rate, although
potentially inflationary, can be expected to have a beneficial effect on overall
exports.
The focus in 2004 will be quality and cost improvements and preparations for
major new product introductions early in 2005. With the launch costs associated
with the introduction of new facilities, the group profit is expected to be
somewhat lower than the exceptional result achieved in 2003.
Registrars:
Computershare Limited,
Investor Services Division
70 Marshall Street
Marshalltown
JOHANNESBURG
2107
Signed on behalf of the board:
E LE R BRADLEY
Chairman
A D PLUMMER
Managing Director
Johannesburg,
17 March 2004
Executive Directors:
A D Plummer (Managing)*; C I J van der Merwe (Finance)
Non-Executive Directors:
E le R Bradley (Chairman); G J Strydom
Independent Non-Executive Directors:
R S Broadley; L Soanes*
* British
Company Secretary:
S M Vermaak
Date: 17/03/2004 05:11:17 PM Produced by the JSE SENS Department
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