| Mon 21 Jun 2004, 17:42 | | WESCO INVESTMENTS LIMITED - AUDITED RESULTS FOR TH |
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WESCO INVESTMENTS LIMITED - AUDITED RESULTS FOR THE 12 MONTHS ENDED 31 MARCH
2004 AND DIVIDEND ANNOUNCEMENT
Wesco Investments Limited
(Incorporated in the Republic of South Africa)
Registration Number 1968/005871/06
ISIN: ZAE000007928
JSE Share code: WES
(`Wesco` or `the company`)
AUDITED RESULTS FOR THE 12 MONTHS ENDED 31 MARCH 2004 AND DIVIDEND ANNOUNCEMENT
* Good results from both Toyota South Africa and Metair Investments
* Headline earnings of 2 417 cents per share (2003: loss of 1 088 cents per
share)
* Dividend increased by 81.8% to 400 cents per share
Introduction
As previously reported, control of Toyota South Africa (Proprietary) Limited
(`Toyota SA`) was disposed of to Toyota Motor Corporation of Japan (`TMC`) with
effect from 1 July 2002, and Wesco changed its year-end from 31 December to 31
March.
Comparative figures in respect of the 15 months ended 31 March 2003 include the
consolidation of Toyota SA`s results to 30 June 2002. Wesco`s 25% interest in
the results of Toyota SA for the year under review has been included in the line
item `Share of associates` retained income` in the abridged group income
statement. Investment income now represents the group`s principal source of
income, and has therefore been reclassified in the income statement to form part
of revenue.
ABRIDGED GROUP INCOME STATEMENT
Audited
Audited 15 months
year ended ended
31 March 31 March
R000 2004 2003
Revenue:
Investment income and growth 73 198 90 594
New motor vehicle and related sales 4 581 511
Cost of sales (4 553 567)
Gross profit 73 198 118 538
Other operating income 1 345 108 305
Distribution costs (134 971)
Administrative and other expenses (4 430) (223 416)
Other operating expenses (6 537) (6 733)
Surplus on disposal of interest in a 174 766
subsidiary company
Operating income 63 576 36 489
Finance costs (1 437) (135 686)
Share of associates` retained income 237 821 49 522
Income (loss) before taxation 299 960 (49 675)
Taxation (94 544) 69 285
Income after taxation 205 416 19 610
Minority interests (1 341) 64 660
Net income attributable to Wesco 204 075 84 270
shareholders
Per share analysis - cents
Basic earnings 2 417 998
Adjustments for headline earnings:
Surplus on disposal of interest in a (2 070)
subsidiary company
Profit on disposal of investments and (16)
property, plant and equipment
Headline earnings (loss) 2 417 (1 088)
Dividends declared and paid 220 200
Cash payment 5 500
ABRIDGED GROUP CASH FLOW STATEMENT
Audited
Audited 15 months
year ended ended
31 March 31 March
R000 2004 2003
Net cash outflow from operating activities (21 192) (504 659)
Net cash from (used in) investing activities (239 587) 989 138
Net cash from (used in) financing activities (44 656)
Increase (decrease) in cash and cash (260 779) 439 823
equivalents
Cash and cash equivalents at end of the 186 280 447 059
period
ABRIDGED STATEMENT OF CHANGES IN EQUITY
Share capital
Balance at beginning and end of the period 11 752 11 752
Non-distributable reserve 886 005 709 916
Balance at beginning of the period 709 916 359 160
Net gains not recognised in the income 25 677
statement
Dilution of interest in associate (1 450)
Movement in associates` reserves 24 305 (667)
Transfers from retained earnings 151 784 327 196
Retained earnings 498 171 464 452
Balance at beginning of the period 464 452 1 188 561
Net income 204 075 84 270
Dividends and cash payments (18 572) (481 183)
Transfers to non-distributable reserve (151 784) (327 196)
Total capital and reserves 1 395 928 1 186 120
ABRIDGED GROUP BALANCE SHEET
Audited Audited
31 March 31 March
R000 2004 2003
Assets
Non-current assets 1 099 133 771 929
Investments in associates 1 095 271 768 161
Property, plant and equipment 3 862 3 768
Current assets 307 241 450 120
Total assets 1 406 374 1 222 049
Equity and liabilities
Capital and reserves 1 395 928 1 186 120
Minority interest 6 780 5 757
Deferred tax 232
Current liabilities 3 434 30 172
Total equity and liabilities 1 406 374 1 222 049
Net asset value per share - cents 16 536 14 051
Number of ordinary shares in issue (000) 8 441.8 8 441.8
NOTES
1. Accounting Policies
These financial statements are prepared in accordance with Statements of
South African Generally Accepted Accounting Practice, including AC127 -
Interim financial reporting. The accounting policies are consistent with
those used in the annual financial statements for the 15-month period ended
31 March 2003, with the exception of AC133 - Financial instruments:
recognition and measurement, which was adopted by the group at 1 April
2003. In accordance with the adoption provisions of AC133 an adjustment of
R25.4 million was made to the group`s reserves at the beginning of the
year.
2. Associates
These results incorporate Wesco`s share of the results of the following
associates:
Interest (%)
Toyota SA 25.00
Metair Investments Limited (`Metair`) 40.05
Metair`s financial year-end is 31 December. Wesco`s results incorporate
Metair`s results for the year ended 31 December 2003.
3. Investments
During April 2003 Wesco and TMC invested R600 million in Toyota SA by way
of equity capital, in proportion to their respective shareholding, in order
to fund capital expansion. Wesco`s contribution amounted to R150 million.
4. Commitments
The company is committed in terms of a shareholders` agreement to purchase
additional equity share capital in its associate, Toyota SA, in order to
fund the latter`s capital requirements. The balance of the original
commitment of R300 million amounts to R150 million.
5. Comparatives
Comparative amounts in the abridged group income statement have been
restated by re-classifying `Investment income and growth` as `Revenue`. The
item was previously disclosed as part of operating income.
COMMENT
Results
Following a lengthy period of reorganisation, Wesco`s operations returned last
year to relative stability. Headline earnings improved to 2 417 cents per share
compared to the loss of 1 088 cents per share in the previous 15-month period,
the combined result of significantly better performances by both Toyota SA and
Metair.
Operational Review
Total local vehicle sales as reported by NAAMSA increased by 5.3% to 368 454
units during the 2003 calendar year. Passenger vehicles sales rose by 6.8% to
247 259 units.
Many of the expected improvements as a result of TMC`s majority ownership of
Toyota SA have subsequently been realised. In the 2003 calendar year the brand`s
overall local market share increased to 26.1%, the highest since 1997, and total
sales of 105 424 units represent a new record for Toyota SA. Its income after
tax for the year under review amounted to R551.2 million compared to a loss of
R54.4 million in the previous 15-month period.
Metair benefited from increased exports of vehicles as a result of the influence
of the Motor Industry Development Plan, and from relatively buoyant local
passenger vehicle sales. The company`s investment over several years in new
technology, increased capacity and improved facilities contributed solidly to
improved returns. As published earlier, Metair recorded net profit of R135.8
million in 2003, an increase of 53.7% over the previous year.
Outlook
Although last year`s excellent performance will be difficult to repeat, the
longer-term outlook is positive with increased exports and new product
introductions being planned.
Wesco has excellent international partners from whom the group receives
outstanding co-operation and assistance, and this aspect should continue to
assist long-term development.
AUDIT REPORT
The results for the year have been audited by PricewaterhouseCoopers Inc. and
their unqualified audit report on the 31 March 2004 annual financial statements
is available for inspection at the company`s registered office.
ANNUAL REPORT
The annual report for the year ended 31 March 2004 will be mailed to
shareholders on 28 June 2004.
ANNUAL GENERAL MEETING
The 2004 annual general meeting will be held at the company`s registered office
on Wednesday, 21 July 2004 at 11:00.
DIVIDEND
A final dividend of 400 (2003: 220) cents per ordinary share has been declared
in terms of the dividend announcement set out below.
WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT
With publication of this report the Cautionary Announcement, which appeared in
the press as part of the company`s Trading Update on 2 June 2004, is accordingly
withdrawn.
On behalf of the board
E Le R BRADLEY G J STRYDOM
Chairman Chief Executive Officer
Johannesburg
21 June 2004
Registered office
Wesco House,
10 Anerley Road,
Parktown, Johannesburg
Telephone 011 646-3011
Facsimile 011 646-3022
Postal address
P O Box 2077,
Saxonwold 2132
Registrar
Computershare Investor Services 2004 (Pty) Ltd
70 Marshall Street,
Johannesburg 2001
(P O Box 61051,
Marshalltown 2107)
Sponsor
LPC Manhattan Sponsors (Pty) Ltd
4th Floor, South Office Tower,
Hyde Park Shopping Centre,
Hyde Park, Johannesburg
(P O Box 41966,
Craighall 2024)
Auditors
PricewaterhouseCoopers Inc.
2 Eglin Road,
Sunninghill, Johannesburg
(Private Bag X36,
Sunninghill 2157)
DIVIDEND ANNOUNCEMENT
Notice is hereby given that final dividend number 35 of 400 cents per ordinary
share has been declared in respect of the financial year ended 31 March 2004. In
compliance with STRATE, the salient dates for the payment of the dividend are as
follows:
Last day to trade cum-dividend Friday, 16 July 2004
Shares commence trading ex-dividend Monday, 19 July 2004
Record date Friday, 23 July 2004
Payment date Monday, 26 July 2004
Share certificates may not be dematerialised/ rematerialised between Monday 19
July 2004 and Friday 23 July 2004, both days inclusive.
On Monday 26 July 2004, the dividend will be electronically transferred to the
bank accounts of certificated shareholders who utilise this facility. In respect
of those who do not, cheques dated 26 July 2004 will be posted on or about that
date. Shareholders who have dematerialised their shares will have their
accounts, held at their CSDP or broker, credited on Monday 26 July 2004.
On behalf of the board
FDW PEACHEY
Company Secretary
Johannesburg
21 June 2004
Directorate:
Executive director:
G J Strydom (Chief Executive Officer)
Non-executive directors:
E Le R Bradley (Chairman), R S Broadley,
A D Plummer (British), P R Robinson
Company Secretary:
F D W Peachey
