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Elb Group Limited - Interim Report And Dividend Announcement
Release Date: 23/03/2004 17:15:01 Code(s): ELR ELRP
ELB Group Limited - Interim Report And Dividend Announcement
ELB GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1930/002553/06)
Share codes: ELR ELRP
ISIN: ZAE000035101 ZAE000035333
INTERIM REPORT AND DIVIDEND ANNOUNCEMENT
for the six months ended 31 December 2003
GROUP INCOME STATEMENT
Unaudited Unaudited Audited
Six Six months Year
months
ended ended ended
31 Dec 03 31 Dec 02 30 June 03
R000 R000 R000
Sales revenue 282 383 246 026 554 685
Net operating costs
excluding depreciation
and amortisation (269 440) (237 198) (526 742)
Operating profit before
depreciation, amortisation
and abnormal items 12 943 8 828 27 943
Depreciation and
amortisation (4 400) (7 517) (14 673)
Operating profit before
abnormal items 8 543 1 311 13 270
Abnormal items as detailed
below: net income 432 - 3 159
Profit from operations 8 975 1 311 16 429
Net treasury expense (4 257) (13 168) (17 602)
Profit/(loss) before tax 4 718 (11 857) (1 173)
Income tax expense (2 877) (1 058) (3 451)
Profit/(loss) after tax 1 841 (12 915) (4 624)
Minority interest (864) 6 631 8 421
Net profit/(loss) 977 (6 284) 3 797
ABNORMAL ITEMS
Capital items
Net recovery from
discontinued operation 432 - 4 479
Impairment of plant and
equipment not in use - - (1 320)
Net abnormal capital
items:
Income 432 - 3 159
RECONCILIATION OF GROUP HEADLINE
EARNINGS
Unaudited Unaudited Audited
Six Six months Year
months
ended ended ended
31 Dec 03 31 Dec 02 30 June 03
R000 R000 R000
Net profit/(loss) for the
period per the income
statement 977 (6 284) 3 797
Deduct: Capital items as
below: 52 (480) 5 351
Net abnormal capital items
before tax as detailed
in the income statement 432 - 3 159
Capital items included in
operating profit before
abnormal items:
Profit/(loss) on disposal
of plant and equipment 51 (272) 306
Goodwill amortisation (463) (271) (543)
Income tax effect of
capital
Items (15) - 2 323
Minority interest in
capital
Items 47 63 106
Headline earnings/(loss) 925 (5 804) (1 554)
Headline earnings/(loss)
as
above 925 (5 804) (1 554)
Deduct: Headline loss of
discontinued operations - (7 963) (12 185)
Translation loss of foreign
treasury cash (5 585) (11 051) (18 374)
Headline earnings of
continuing operations
before translation loss of
foreign treasury cash 6 510 13 210 29 005
Weighted average number of
shares (excluding
treasury shares) on which
basic earnings per
share are based (000"s) 30 452 30 760 30 783
Headline earnings per
ordinary share of
continuing operations
before translation
adjustment of foreign
treasury cash - basic 21,4 42,9 94,2
- fully diluted 21,3 42,9 93,7
Headline earnings/(loss)
per ordinary share (cents)
- basic 3,0 (18,9) (5,0)
- fully diluted 3,0 (18,9) (5,0)
Earnings/(loss) per
ordinary share (cents)
- basic 3,2 (20,4) 12,3
- fully diluted 3,2 (20,4) 12,3
Dividends declared for the
period per ordinary share
(cents) 10,0 10,0 30,0
GROUP BALANCE SHEET
Unaudited Unaudited Audited
31 Dec 03 31 Dec 02 30 Jun 03
R000 R000 R000
ASSETS
Non current assets 39 647 77 047 36 529
Property, plant and
equipment 22 068 60 973 18 813
Intangible assets 8 512 5 681 5 527
Non current debtors 2 457 5 607 5 855
Deferred tax assets 6 610 4 786 6 334
Current assets 363 762 321 483 388 073
Inventories 164 751 94 171 128 603
Debtors and prepayments 42 619 41 153 60 800
Cash and cash equivalents 156 392 186 159 198 670
Total assets 403 409 398 530 424 602
EQUITY AND LIABILITIES
Capital and reserves 143 494 146 277 153 533
Issued capital 5 472 9 954 10 253
Reserves 750 750 750
Accumulated profit 137 272 135 573 142 530
Preference shares 8 8 8
Minority interest 2 385 1 204 1 521
Total equity 145 887 147 489 155 062
Minority long term loans to
subsidiary - 49 148 -
Non current liabilities 16 842 16 806 16 580
Interest bearing borrowings 621 1 421 664
Deferred tax liabilities 16 221 15 385 15 916
Current liabilities 240 680 185 087 252 960
Non interest bearing
creditors and accruals 150 318 115 856 186 895
Interest bearing creditors 58 477 47 538 46 930
Short term borrowings and
bank overdrafts 31 885 21 693 19 135
Total equity and 403 409 398 530 424 602
liabilities
Ordinary shares in issue
(000"s) 33 860 30 760 30 860
Deduct: Treasury shares in
issue (000"s) 5 586 - -
Ordinary shares in issue on
which net asset value
per share is calculated 28 274 30 760 30 860
Net asset value per share
(cents) 508 476 498
Note
At 31 December 2003 there was a capital commitment of R146 000
(31 December 2002 - nil, 30 June 2003 - R347 000).
GROUP CASH FLOW STATEMENT
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 03 31 Dec 02 30 June
03
R000 R000 R000
Cash flows from operating
activities before
dividends paid (37 515) 31 163 62 696
Dividends paid (6 172) (4 737) (8 089)
Cash (outflow)/inflow from
operating activities (43 687) 26 426 54 607
Cash outflow from
investment activities (9 852) (9 009) (19 672)
Cash outflow from financing
activities (1 489) (6 932) (7 700)
(Decrease)/increase in net
cash and cash equivalents (55 028) 10 485 27 235
Cash and cash equivalents
at
the beginning of the period 179 535 153 981 153 981
Bank overdraft less cash of
subsidiary at acquisition - - (590)
Net cash of Safbin Systems
on liquidation - - (1 091)
Net cash and cash
equivalents at the end of
the period 124 507 164 466 179 535
GROUP STATEMENT OF CHANGES IN CAPITAL AND RESERVES
Unaudited Unaudited Audited
Accu- Total Total Total
Issued mulated 31 Dec 31 Dec 30 Jun
capital Reserves profit 2003 2002 2003
R000 R000 R000 R000 R000 R000
Balance at
the
beginning
of the 10 253 750 142 530 153 533 164 983 164 983
period
Movement in
issued
capital
Shares
issued
to The ELB
Participants
Share Trust 15 000 15 000 - -
Shares
issued
under the
share
incentive
scheme - - - 300
Listing fee
and (61) (61) - (1)
securities
tax
Loan to The
ELB
Participants
Share Trust (19 (19 720) - -
720)
Movement in
accumulated
profit
Net profit/
(loss) for
the period 977 977 (6 284) 3 797
Translation
adjustments
of
foreign (63) (63) (7 808) (7 846)
entities
Final
dividend for
the previous (6 172) (6 172) (4 614) (4 614)
year
Interim
dividend for
the current - - - (3 086)
year
Balance at
the end of
the period 5 472 750 137 272 143 494 146 277 153 533
SEGMENT ANALYSIS
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
31 Dec 03 31 Dec 02 30 June
03
R000 R000 R000
SALES REVENUE
Continuing operations
ELB Equipment Holdings 226 587 173 967 406 120
ELB McWade Electrical 35 781 34 123 73 335
ELB Timber Holdings 20 015 26 504 49 361
Total continuing operations 282 383 234 594 528 816
Discontinued operations
Safbin Systems - 11 380 25 817
Other - 52 52
Total 282 383 246 026 554 685
HEADLINE EARNINGS/(LOSS)
Continuing operations
ELB Equipment Holdings 7 511 8 160 22 920
ELB McWade Electrical 3 531 2 934 5 121
ELB Timber Holdings (4 532) 2 116 964
Continuing operations before
adjustment below 6 510 13 210 29 005
ELB Equipment Holdings
Translation loss of foreign
treasury cash (5 585) (11 051) (18 374)
Total continuing operations 925 2 159 10 631
Discontinued operations
Safbin Systems - (7 963) (12 910)
Other - - 725
Headline earnings /(loss) 925 (5 804) (1 554)
Capital items
Continuing operations
Profit/(loss) on disposal of
plant and equipment 51 (285) 306
Goodwill amortisation (463) (271) (543)
Tax effect of capital items (15) (6) 305
Minority interest in capital
items 47 72 106
Discontinued operations
Net recovery 432 - 4 479
Impairment of plant and
equipment not in use - - (1 320)
Profit on disposal of plant
and equipment - 19 -
Tax effect of capital items - - 2 018
Minority interest in capital
items - (9) -
Net profit/(loss) 977 (6 284) 3 797
COMMENTS
INTRODUCTION
ELB is an investment holding company comprising three trading segments namely
ELB Equipment Holdings, ELB McWade Electrical, and ELB Timber Holdings.
FINANCIAL RESULTS
The results for the six months to 31 December 2003 reflect the ongoing progress
being made to rebuild the ELB Group.
ELB Equipment Holdings has traded slightly ahead of budget for the six months.
ELB McWade Electrical has traded in line with budget.
ELB Timber Holdings has been affected by the stronger Rand. It has made a
further acquisition during the period by acquiring 100 per cent of Ultrabord
(Pty) Limited for R5,25 million. Ultrabord is involved in the production of
particle board. Good progress is being made with the overhauling of the plant
which is now able to produce product to the required specifications.
PROSPECTS
ELB Equipment Holdings is expected to trade ahead of budget for the second half
of the year.
ELB McWade Electrical is likely to remain in line with budget for the second
half of the year.
ELB Timber Holdings is focusing on building a capability to produce and market
higher value niche market products and is not expected to be profitable for the
twelve months to 30 June 2004.
DIVIDENDS
The interim dividend has been maintained at 10 cents per share.
ACCOUNTING POLICIES AND COMPARATIVES
Accounting policies are in accordance with South African Statements of Generally
Accepted Accounting Practice and are consistent with those applied in the
previous financial year ended 30 June 2003.
In the previously reported results for the comparative six months ended 31
December 2002 the deferred tax liability on the foreign treasury reserves was
reversed following the announcement by the Minister of Finance that foreign
dividends would no longer attract tax, and translation losses of all foreign
operations were treated as charges in the income statement. As disclosed in the
annual report for the year ended 30 June 2003, management decided that it was
prudent to continue to accrue in full for the deferred tax liability on the
foreign treasury reserves until legislation in this regard has been enacted, and
that certain foreign operations are more appropriately classified as foreign
entities and therefore that the translation adjustments relating to these
entities be reflected in the statement of changes in capital and reserves. The
comparatives for the six months ended 31 December 2002 have been restated
accordingly.
On behalf of the Board
WGL Bateman AG Fletcher
Chairman Executive Deputy Chairman
Boksburg
16 March 2004
DIVIDENDS
The directors have declared the following dividends in respect of the interim
six month period ended 31 December 2003.
PREFERENCE DIVIDEND Number 106
An interim dividend at the rate of 6% per annum on the 6% fixed cumulative
redeemable preference shares of R2 each, equivalent to 6 cents per share.
ORDINARY DIVIDEND NUMBER 112
An interim dividend of 10 cents per share on the ordinary shares.
The salient dates in respect of both dividends are:
Date of declaration Tuesday, 16 March 2004
Last day to trade cum dividend Tuesday, 6 April 2004
Shares commence trading ex dividend Wednesday, 7 April 2004
Record date Friday, 16 April 2004
Date of payment Monday, 19 April 2004
No shares may be dematerialised or rematerialised between Wednesday, 7 April
2004 and Friday, 16 April 2004, both dates inclusive.
By order of the Board
DG Jones Boksburg
Secretary 16 March 2004
REGISTERED OFFICE
Founders I Building
Bartlett Road, Boksburg North, 1459
SHARE TRANSFER SECRETARIES
Computershare Limited
70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
SPONSOR
Rand Merchant Bank Corporate Finance
A division of FirstRand Bank Limited
1 Merchant Place, Cnr Fredman Drive & Rivonia Road
Sandton, 2196
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