| Thu 22 Jul 2004, 16:40 | | AUDITED FINAL RESULTS FOR THE YEAR ENDED 30 APRIL |
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AUDITED FINAL RESULTS FOR THE YEAR ENDED 30 APRIL 2004
SHOPS FOR AFRICA LIMITED
(Registration number: 2000/018084/06)
Share code: SFA
ISIN: ZAE000031241
AUDITED FINAL RESULTS FOR THE YEAR ENDED 30 APRIL 2004
ABRIDGED INCOME STATEMENT for the year ended 30 April
2004 2003
Notes R`000 R`000
Revenue 88 679 85 466
Operating expenses (39 114) (36 232)
Trading profit 49 565 49 234
Profit on sale of investment properties 10 701 587
Profit on sale of investment in associate 869 -
Revaluation of investment properties 2 817 18 107
Revaluation of receivable 129 -
Operating profit 64 081 67 928
Finance costs (54 054) (49 521)
Interest income 2 808 1 150
Amortisation of discount on debentures (2 176) -
Finance charges - loans (30 748) (31 728)
Finance charges - debentures (23 938) (18 943)
Net profit before taxation 10 027 18 407
Taxation (518) (4 953)
Net profit after taxation 9 509 13 454
Income from associate 2 298 1 084
Net profit for the year 11 807 14 538
cents cents
Earnings per share 16.99 23.35
Headline (loss)/earnings per share 2 (0.57) 0.62
Distribution per linked unit 34.44 30.41
- interim 16.91 15.19
- final 17.53 15.22
Number of linked units in issue (`000) 72 115 65 896
Weighted average number of linked units in
issue (`000) 69 481 62 249
ABRIDGED BALANCE SHEET at 30 April
ASSETS
Investment properties 4 127 390 543
Investment in associate - 1 459
Current assets 444 954 9 221
Total assets 449 081 401 223
EQUITY AND LIABILITIES
Share capital 721 659
Share premium 559 559
Distributable reserves 15 050 5 267
Shareholders` interest 16 330 6 485
Debentures 179 565 164 081
Linked unitholders` interest 195 895 170 566
Long-term borrowings 219 000 209 114
Deferred taxation 2 859 4 651
Current liabilities 31 327 16 892
Total equity and liabilities 449 081 401 223
ABRIDGED CASH FLOW STATEMENT for the year ended 30 April
Net cash flows from operating activities (858) (3 859)
Cash generated by operations 45 511 48 967
Interest received 2 808 1 150
Finance charges paid (27 972) (33 110)
Debenture interest paid (21 314) (20 643)
Taxation received/(paid) 109 (223)
Net cash flows from investing activities (22 195) (50 414)
Net cash flows from financing activities 23 928 48 639
Increase/(decrease) in cash and cash
equivalents 875 (5 634)
ABRIDGED STATEMENT OF CHANGES IN EQUITY for the year ended 30 April
Distributable
reserves/
Share Share (accumulated
capital premium loss) Total
R`000 R`000 R`000 R`000
Balance at 1 May 2002 547 - (9 271) (8 724)
Shares issued 112 559 - 671
Net profit for the year - - 14 538 14 538
Balance at 30 April 2003 659 559 5 267 6 485
Balance at 1 May 2003 (as
previously disclosed) 659 559 5 267 6 485
Effect of adopting AC133 - - (2 024) (2 024)
Restated opening balances 659 559 3 243 4 461
Shares issued 62 - - 62
Net profit for the year - - 11 807 11 807
Balance at end of year 721 559 15 050 16 330
Notes to the financial statements for the year ended 30 April 2004
1. All accounting policies are consistent in all material respects with those
adopted in the previous financial year except for the adoption of AC133 -
Financial Instruments: Recognition and Measurement during the current year.
2004 2003
R`000 R`000
2. Reconciliation of basic earnings to headline
(loss)/earnings
Basic earnings 11 807 14 538
(12 203) (14 155)
Increase in valuation of investment properties (2 817) (18 107)
Profit on sale of investment properties (10 701) (587)
Profit on sale of investment in associate (869) -
Negative goodwill on acquisition of associate - (375)
Taxation effect 2 184 4 914
Headline (loss)/earnings (396) 383
REVIEW OF RESULTS
The results for the year to 30 April 2004 comprise an eleven-month operating
period due to the sale of the property portfolio to ApexHi Properties Limited
(ApexHi) on 1 April 2004. The declining interest rate environment as well as an
improvement in the performance of the property portfolio resulted in an
increase in distributions from 30.41 cents to 34.44 cents (37.57 cents
annualised) per linked unit, which represents an increase of 23.5% on an
annualised basis. The trading update, published on 7 November 2003, forecast an
annual distribution of 38.11 cents. The actual distribution is in line with the
forecast when adjusted for the shorter operating period and costs associated
with the ApexHi transaction.
The reduction in interest rates resulted in a 16% decrease in the interest
charge on a like for like basis. Turnover increased by 8% when compared with
the prior year on a like for like basis. This performance was driven by lower
average vacancies.
Trading margins decreased from 58% to 56% as a result of costs associated with
the sale of the property portfolio. These included professional fees and the
write-off of deferred letting commission and tenant installation costs.
Due to the pending liquidation of the company, costs that were capitalised and
amortised in terms of AC133 amounting to R3.634 million were expensed during
the current year. Of this amount, R2.176 million relates to a discount on
debentures issued and R1.442 million to bond raising fees, which was included
in finance charges on loans, to reflect the carrying value of assets at their
net realisable values and liabilities at settlement values. The opening
retained earnings were reduced by R2.024 million to effect the AC133 adjustment
in prior years, which was mainly attributable to the company`s associate, Sammy
Q Properties (Pty) Ltd. The profit on sale of associate was increased by R2.226
million due to the opening balance adjustment relating to the implementation of
AC133.
Property Portfolio
On 3 October 2003 Sammy Marks` Square Portion 3 was transferred to Shops for
Africa for R37 million.
At a general meeting of shareholders held on 12 March 2004, it was agreed that
the entire property portfolio, excluding certain properties already sold
separately, be sold to ApexHi with an effective date of 1 April 2004. A profit
of R11.2 million was realised based on the combined ApexHi clean price of
R15.12 on 1 April 2004. It was further agreed that the company is to be
delisted from the JSE Securities Exchange SA and will apply for voluntary
liquidation.
The majority of the company`s assets at year-end comprise proceeds receivable
from the sale of the property portfolio. Subsequently, this was converted into
cash and listed ApexHi linked units on transfer of the properties on 30 June
2004. All liabilities will be settled and the net proceeds will be distributed
to unitholders as a liquidation dividend.
Subsequent to entering into the ApexHi transaction, a tenant exercised its pre-
emptive right to acquire the Woolworths Wynberg property (R1.7 million). Three
other properties, Station Bazaar (R14 million), Shoprite Lambton Garages (R1
million) and vacant land at Shoprite Lambton (R1.35 million) have been sold
separately. The transfer of Station Bazaar was effected on 4 November 2003.
Possession and occupation of the Shoprite Lambton Garages and vacant land at
Shoprite Lambton passed on transfer, which took place on 30 June 2004. The
Woolworths Wynberg property is expected to be transferred during August 2004.
These properties are disclosed as investment properties on the balance sheet at
year-end at values equating to the sales considerations according to the
signed agreements.
These results have been audited by the company`s auditors, KPMG, and their
opinion is available for inspection at the company`s registered office
(detailed below) during office hours.
Declaration of Interest Distribution
Notice is hereby given of the final distribution of 17.53c per Shops for Africa
linked unit for the six-month period 1 November 2003 to 30 April 2004.
Last day to trade linked units cum distribution Thursday, 5 August 2004
Linked units begin to trade ex-distribution Friday, 6 August 2004
Record date Friday, 13 August 2004
Payment date Monday, 16 August 2004
By order of the Board
B P MITCHELL
Company Secretary
Cape Town
21 July 2004
Directors:
I L Sturrock (Chairman), J D Broll, B T Kubheka, B P Mitchell*,
W A Botha* *Executive
Company secretary and registered office:
B P Mitchell CA(SA)
Transfer secretaries:
Computershare Investor Services 2004 (Pty) Ltd
(Registration number 2004/003647/07)
Ground Floor
70 Marshall Street, Johannesburg 2001
Shops for Africa Limited
(Registration number: 2000/018084/06)
Share code: SFA
ISIN: ZAE000031241
6th Floor, Protea Place
Protea Road, Claremont 7700
Asset managers Sponsor
CATALYST SASFIN
Property Asset Managers Corporate Finance
Date: 22/07/2004 04:27:30 PM Produced by the JSE SENS Department
