| Thu 22 Apr 2004, 17:24 | | radehold Limited 2004 Group results For the |
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Tradehold Limited 2004 - Tradehold Limited 2004 Group results For the
year to 29 February 2004
Tradehold Limited 2004 Group results For the year to 29 February 2004
(Registration number 1970/009054/06)
JSE share code: TDH ISIN: ZAE000026902
Group Income statement
Audited Reviewed Reviewed Audited
8 months 12 months 12 months 8 months
to to to to
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
276 997 313 392 Revenue 3 776 851 4 184 191
187 271 280 281 Continued operations 3 373 663 2 793 628
89 726 33 111 Discontinued operations 403 188 1 390 563
(8 129) (8 626) Operating loss (112 415) (124 823)
7 942 (5 366) Continued operations (71 703) 125 306
(16 071) (3 260) Discontinued operations (40 712) (250 129)
738 696 Net interest received 8 462 11 073
(7 391) (7 930) Loss before exceptional (103 953) (113 750)
items
(33 845) (1 812) Exceptional items (22 186) (477 126)
(41 236) (9 742) Loss before taxation (126 139) (590 876)
(1 732) (976) Taxation (13 981) (32 010)
(39 504) (8 766) Loss after taxation (112 158) (558 866)
(12 958) (1 494) Minority interest (20 975) (181 689)
(11) (1 647) Attributable to normal (22 792) (657)
activities
Attributable to
(12 947) 153 exceptional items 1 817 (181 032)
(26 546) (7 272) Net loss (91 183) (377 177)
Pence Pence Earnings per share Cents Cents
(1,6) (1,5) - before exceptional items (19,3) (23,3)
(7,6) (2,1) - after exceptional items (26,3) (108,6)
(1,4) (2,0) - headline earnings (24,7) (20,1)
Number of shares for
calculation of earnings
347 330 347 330 per share ("000) 347 330 347 330
Group Balance Sheet
Audited Reviewed Reviewed Audited
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
71 657 53 198 Non-current assets 657 156 929 254
Property, plant and
56 377 34 654 equipment 428 079 731 097
10 956 13 550 Investments 167 381 142 083
4 324 4 994 Deferred taxation 61 696 56 074
80 548 89 023 Current assets 1 099 692 1 044 542
29 679 42 372 Inventories 523 421 384 877
17 891 12 640 Accounts receivable 156 138 232 009
32 978 34 011 Cash and cash equivalents 420 133 427 656
152 205 142 221 Total assets 1 756 848 1 973 796
Ordinary shareholders"
62 560 55 034 equity 679 838 811 288
12 12 Preference share capital 144 144
9 875 8 594 Minority interest 106 158 128 054
Non-current liabilities:
21 556 17 547 Provisions 216 756 279 538
58 202 61 034 Current liabilities 753 952 754 772
Short-term loans and bank
2 038 8 689 overdrafts 107 336 26 429
56 164 52 345 Other current liabilities 646 616 728 343
Total equity and
152 205 142 221 liabilities 1 756 848 1 973 796
Group cash flow statement
Audited Reviewed Reviewed Audited
8 months 12 months 12 months 8 months
to to to to
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
20 238 (25 892) Cash flow from operations (376 764) 193 476
45 20 688 Investment activities 292 920 44 617
Net disposal of fixed
(8 778) 13 188 assets 166 459 (130 213)
Other investment
8 823 7 500 activities 126 461 174 830
20 283 (5 204) Net cash flow (83 844) 238 093
1 615 (960) Financing activities (12 794) 19 686
270 389 Proceeds from share issue 5 123 4 175
1 345 (1 349) Net debt repaid (17 917) 15 511
Decrease in cash and cash
21 898 (6 164) equivalents (96 638) 257 779
Group statement of changes in equity
Audited Reviewed Reviewed Audited
8 months 12 months 12 months 8 months
to to to to
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
Balance at 1 July 2002/1
85 385 62 560 March 2003 811 288 1 344 455
Adjustment at 1 July 2002
in terms of
AC 133 in respect of
(458) - derivatives - (7 198)
(221) (254) Exchange rate adjustments (40 267) (220 640)
Surplus on revaluation of
4 400 - land and buildings - 71 848
(26 546) (7 272) Net loss for the period (91 183) (377 177)
62 560 55 034 679 838 811 288
Supplementary information
Audited Reviewed Reviewed Audited
months 12 months 12 months 8 months
to to to to
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
1. Depreciation for the
5 707 4 883 period 59 080 84 879
2. Capital expenditure
9 835 15 419 for the period 189 770 145 486
3. Calculation of
headline earnings
(26 546) (7 272) Net loss (91 183) (377 177)
Attributable
20 898 196 exceptional items 2 151 296 094
Loss on sale and
scrapping of fixed
assets
after taxation and
789 271 minority interest 3 284 11 309
(4 859) (6 805) (85 748) (69 774)
Audited Reviewed Reviewed Audited
28/02/03 29/02/04 29/02/04 28/02/03
4. Number of shares in
347 330 347 330 issue ("000) 347 330 347 330
5. Net asset value per
18,0 15,8 share (pence/cents) 195,7 233,6
6. Investments
10 956 13 550 Loans 167 381 142 083
14 370 2 705 7. Capital commitments 33 415 186 350
18 186 13 888 8. Contingent liabilities 171 558 235 836
9. Operating lease
32 452 29 742 commitments 367 403 420 837
Analysis of results
Audited Reviewed Reviewed Audited
8 months 12 months 12 months 8 months
to to to to
28/02/03 29/02/04 29/02/04 28/02/03
GBP"000 GBP"000 R"000 R"000
Attributable earnings of
(350) (1 916) Brown & Jackson plc (26 473) (6 150)
Earnings of Tradegro (UK)
(6 698) (5 038) Ltd (60 642) (95 978)
Other Tradehold Ltd group
1 400 1 647 companies 19 935 21 045
Loss before exceptional
(5 648) (5 307) items (67 180) (81 083)
Attributable exceptional
(20 898) (1 965) items (24 003) (296 094)
(26 546) (7 272) Net loss (91 183) (377 177)
Operating review
Investment holding company Tradehold, contrary to expectations at the
half-year, has not been able to deliver a profit for the year to 29
February 2004. This was due mainly to disappointing Christmas sales in
the listed British retailer Brown & Jackson plc, despite the positive
turnaround of that company over the first six months. Although it was
judged on the point of returning to profitability, Brown & Jackson"s
inability to capitalise on the traditionally higher consumer spend
over the Christmas period resulted in a disappointing performance for
the second six months and a loss for the full year.
Brown & Jackson plc
Despite sales picking up markedly since January 2004, operational
setbacks in the run-up to the Christmas season have delayed Brown &
Jackson"s return to profitability by a year. It operates about 330
stores in England and Ireland of which about 170 are in High Street
locations and the rest in out-of-town developments.
The reasons for the poor performance over the Christmas season are all
directly or indirectly related to the all-embracing and ongoing
repositioning programme aimed at turning Brown & Jackson into a
formidable competitor in the variety discount sector. So extensive
have these changes been that today the rejuvenated business already
bears little resemblance to the one that existed before the new
executive team took over in September 2002.
The main problem areas were the late arrival in the stores of directly
sourced Christmas ranges; the deterioration in sales in the company"s
High Street stores (which represent about a third of turnover);
insufficient promotional activity in an increasingly competitive
market in the run-up to Christmas; and the lack of capacity in its
present distribution centres.
Management immediately took corrective action which resulted in an
upward sales curve that began in January and is still continuing.
The high level of consumer acceptance for the company"s new brand
"...instore" has been most encouraging. "...instore" provides a
shopping environment akin to mass-market "quality" retailers but at
prices normally associated with the "value" end of the retail market.
Seven pilot stores under the new brand were launched in September
2003, all but one of them converted Poundstretcher outlets. They
proved to be an immediate success, producing a 20% like-for-like sales
growth in the period to year-end. A further three were opened in March
and are also trading ahead of expectations.
In the light of these results Brown & Jackson management is convinced
the new format represents the future strategic direction, and a
further 50 to 60 stores will be converted to the new brand during the
2005 financial year.
Tradegro UK
The interests of Tradegro (UK), a wholly-owned subsidiary of
Tradehold, have lately been centred in three areas: in the retail
chain Your More Store (YMS), which operates predominantly in Scotland
and the North of England; in B&J Poland, which operates 16 branches in
that country; and in a portfolio of retail properties.
In the second half of the year Tradegro (UK) sold 49% of its interest
in YMS to Pepkor and 25% to YMS management. At year-end Tradegro (UK)
divested itself of its remaining 26% holding in YMS and its 100%
holding in B&J Poland.
In October 2003 Tradegro (UK) sold 41 of the 73 freehold properties in
its portfolio for GBP25 million. The remaining properties, valued at
GBP8 million, all house YMS outlets. The function of the company"s
property portfolio is to support its core activity, which is
retailing. By selling off part of its portfolio, it has freed up
capital for new opportunities that may arise.
COMMENTS ON THE RESULTS
The results of YMS have been consolidated until September 2003, when
74% of that business was sold, and that of B&J Poland until year-end.
Exceptional items are:
Provision against loan advanced to YMS (GBP1,8 million)
Over-recovery on the proceeds of
the liquidation of What Everyone
Wants (WEW) and The Famous
Brunswick Warehouse (TFBW) GBP1,2 million
Increase in the provision for WEW
leases for which guarantees had been
provided at the time of the demerger
of Brown & Jackson in 2002 (GBP1,2 million)
(GBP1,8 million)
OUTLOOK
Even though the results for the 2004 financial year were
disappointing, we are encouraged by the post-Christmas recovery at
Brown & Jackson reflecting also the ability of its management to
speedily identify and correct problem areas. In the light of the
success of its new trading format and plans to accelerate its roll-
out, as a Board we are cautiously optimistic about the future.
Developments since year-end
On 22 April the Board of Brown & Jackson announced plans to raise
about GBP25,4 million by way of a rights issue which is fully
underwritten. The company will be issuing 50,8 million new ordinary
shares which will be offered to existing shareholders at a price of
50p a share and on the basis of two new ordinary shares for every
seven ordinary shares held.
The capital raised will be used primarily to fund the rollout of the
new "...instore" format; the development and equipping of the group"s
new distribution centre at Huddersfield, which will also accommodate
its new head office; and the replacement of its electronic point of
sale (EPOS) system.
Accounting policy
The annual financial statements have been prepared
on the historical cost basis in accordance with South African
Statements of Generally Accepted Accounting Practice. In all material
respects the accounting policies accord with those adopted during the
previous financial year.
The group"s auditors, PricewaterhouseCoopers Inc., reviewed the
group"s results. Their unqualified review report is available on
request from the company secretary.
Reporting currency
As the operations of Tradehold"s subsidiaries are conducted in pound
sterling and because of the distortion caused by the fluctuating value
of the rand, the company is reporting its results in the former
currency. Rand equivalents are provided to comply with regulatory
requirements.
C Moore G Bernard
Director Director
Luxemburg 23 April 2004
Date: 22/04/2004 05:00:14 PM
Produced by the JSE SENS Department
