| Wed 29 Sep 2004, 17:32 | | RESULTS OF THE GROUP FOR THE SIX MONTHS ENDED 30 J |
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NAIL - INTERIM RESULTS OF THE GROUP FOR THE SIX MONTHS ENDED 30 JUNE 2004
NEW AFRICA INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/002467/06)
(Share codes: NAI and NAN)
(ISIN: ZAE000033338 and ZAE000033346)
(`NAIL` or `the Group`)
DIRECTORS STATEMENT
YOUR DIRECTORS TAKE PLEASURE IN PRESENTING THE INTERIM RESULTS OF THE GROUP FOR
THE SIX MONTHS ENDED 30 JUNE 2004.
BASIS OF PREPARATION
The condensed consolidated financial statements are
prepared in accordance with South African Statements of Generally Accepted
Accounting Practice, the South African Companies Act, as amended, and the
disclosure requirements of the JSE Securities Exchange.
The condensed consolidated financial statements are prepared on a going concern
basis, using historical cost basis of accounting except for available-for-sale
investments, which are stated at fair value.
The principal accounting policies are consistent with those applied in the
annual financial statements for the year ended 31 December 2003.
CORPORATE GOVERNANCE
The Group adheres to locally accepted corporate governance practices, as
embraced by the King II Report.
DIRECTORSHIP CHANGES
Mr S Macozoma stepped down as Chief Executive Officer of NAIL on 31 May 2004.
He remains a Non-Executive Director.
With effect from 29 September 2004 the following non-executive directors
resigned from the NAIL board: Mdms Mojela and Serobe and Mssrs Curtis, Katz,
Mdlalose, Ngoasheng and Williams.
The Chairman wishes to express his appreciation for their valuable contribution
over the tenure of their directorship.
The reconstituted board will consist of Mr A Mabogoane (Chairman), S Macozoma,
F Titi, G Chadwick, G Snelgar, K Setzin and R Kevan.
CONTINGENT LIABILITIES
NAIL is a partner together with Metropolitan and BoE for the management,
collection and funding of the African Bank Debtors Book which was excluded from
the sale of the African Bank to African Bank Investment Limited.
NAIL`s contingent liability in respect of additional funding required in the
event that the total debtors book was uncollectable amounts to R67,6 million
(2003: R71,9 million). A transaction has been concluded between NAIL,
Metropolitan and BoE for the partnership to be unwound and the book to be ceded
to a company Unique Finance.
This transaction is subject to regulatory approvals.
ASSET DISPOSAL PROCESS
The disposal process of NAIL assets started after the Competition Commission
approved the Tiso Consortium`s acquisition of NAIL during February 2004.
The following assets were disposed of during the period under review:
* 7 756 917 MTN shares realising R232,4 million
* 2 451 052 Johnnic shares realising R39,0 million
* 50,1% of Urban Brew Studios realising R21,5 million
* 31,7% of Radmark realising R14,2 million
* 93,3% of New Africa Books realising R9 million
* Kaya FM funding structures over 22% of Kaya FM realising R16,5 million
RETURN OF CASH TO SHAREHOLDERS
The following distributions to shareholders were made during the period under
review:
* Cash distribution of R6,86 by way of capital reduction
* 36 356 142 Metropolitan shares by way of a dividend in specie.
OPERATING PERFORMANCE
The group is in a disposal process so all the assets are classified as
discontinuing operations.
* Radio
The results include Jacaranda 94.2 FM, Kfm 94.5 and Kaya FM for the full six
months.
Radmark, the radio sales house, was sold effective 31 March 2004.
* Publishing
The results include New Africa Publications for the full six months.
New Africa Books was sold effective from 1 January 2004.
* Film and TV
Urban Brew was sold effective from 31 March 2004.
New Africa Media Films has ceased
production of films. The film Slash has been distributed internationally and
the proceeds are starting to flow.
* Outdoor
Outdoor performed poorly as a result of a marked decrease in the signage
business and low sell out rates in the outdoor media division.
* Hertz
The reduced losses are as a result of the reduced costs of the fleet resulting
from lower interest rates and lower inflation on new vehicles.
* Head office and interest
Finance income has decreased from the impact of lower interest rates and the
return of cash to shareholders.
UNCERTAINTY AROUND FINAL DISPOSAL PRICES OF UNDERLYING ASSETS
The board has announced its intention to dispose of the underlying assets and
return cash to shareholders. This has the effect of classifying all assets as
discontinuing operations.
The written down carrying value for Hertz, NAIL Outdoor and the film
investments amounts to R107,3 million. Offers have been received for these
assets that were significantly less than the carrying value.
The board of directors has not accepted these offers. There is an uncertainty
as to the final realisation values attributable to these assets, which may have
a material impact on the carrying values as included in the financial
statements.
POST BALANCE SHEET EVENTS
Post balance sheet date the company has distributed:
A special dividend of R1,12 was paid to shareholders on 23 August 2004. The
total distribution being R142 million.
The Group has sold:
* Jacaranda FM
* New Africa Publications
The Group has sold the following assets subject to NAIL shareholder approval:
* KFM
* KFM funding structure over 28,5% of KFM
Negotiations are in progress to dispose of the remaining assets.
A S MABOGOANE K SETZIN
Non-executive Executive Director
Chairman
28 September 2004
Consolidated income statement
Unaudited Unaudited Audited
six months six months year ended
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Revenues 269 459 296 066 617 903
Operating profit/(loss) before
the following items: 19 873 (31 191) 30 967
Amortisation and depreciation (13 182) (16 822) (47 263)
Fair value gains and losses 47 276 32 314 168 843
Net profit/(write down) of
investments and loans 4 387 (6 967) (11 525)
Impairments of goodwill - - (57 600)
Operating profit/(loss) 58 354 (22 666) 83 422
Finance income 17 844 41 822 67 732
Income from associates 6 925 9 724 20 728
Profit before taxation 83 123 28 880 171 882
Taxation 19 101 12 448 74 650
Profit after taxation 64 022 16 432 97 232
Minority interest (6 144) (212) 9 511
Profit attributable to ordinary
shareholders 57 878 16 220 106 743
HEADLINE EARNINGS
Profit attributable to ordinary
shareholders 57 878 16 220 106 743
Net profit on sale of businesses (4 387) - -
Amortisation of goodwill 4 908 7 067 13 961
Impairment of goodwill - - 57 600
Restructuring costs - - 8 478
(Profit)/loss on sale of fixed
assets - 18 (366)
Minority portion and tax effect - (3) 111
58 399 23 302 186 527
Headline earnings per share
(cents) 46,1 19,2 151,9
Earnings per share (cents) 45,7 13,3 86,9
No of shares taken into account
in calculating EPS (000) 126 760 121 515 122 808
Segmental analysis of headline earnings
six months six months year ended
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Media
Publishing 3 399 841 2 182
Radio 16 536 13 304 26 276
Film and Tv 1 080 630 3 736
Outdoor (1 103) (426) (4 646)
Total Media 19 912 14 349 27 548
Other
Financial services - 7 453 13 997
Hertz (1 859) (8 565) (9 777)
African Bank Debtors Book - (18 340) (15 259)
Head Office and interest 40 346 28 405 170 018
Total Group 58 399 23 302 186 527
Consolidated cash flow
Unaudited Unaudited Audited
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Cash retained from operating
activities 5 607 18 388 36 787
Cash effects of investing activities 354 760 16 117 (4 109)
Cash effects of financing activities (884 096) (9 493) 31 848
Foreign currency translation 2 133 - 2 335
Net increase in cash and cash
equivalents (521 596) 25 012 66 861
Cash and cash equivalents at
beginning of the period 706 788 639 927 639 927
Cash and cash equivalents at end
of the period 185 192 664 939 706 788
Consolidated balance sheet
Unaudited Unaudited Audited
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Assets
Property, plant and equipment 67 552 89 439 87 419
Intangible assets 147 047 231 192 162 044
Investments 97 555 466 025 633 653
Other non current assets 19 109 17 696 20 567
Current assets 326 435 837 456 885 725
TOTAL ASSETS 657 698 1 641 808 1 789 408
Total Equity and Liabilities
Share capital and premium 4 814 841 160 874 389
Reserves 539 978 661 437 753 320
Minority interest 30 834 54 586 40 662
Non current liabilities 18 380 11 508 28 206
Current Liabilities 63 692 73 117 92 831
TOTAL EQUITY AND
LIABILITIES 657 698 1 641 808 1 789 408
Net asset value per share (cents) 430 1 237 1 284
No of shares in issue at end
of period 126 760 121 478 126 760
Statement of changes in equity
for the period ended Share capital
30 June 2004 and Premium Reserves Total
R000 R000 R000
Balance 31 December 2002 841 049 644 242 1 485 291
Net income for year - 106 743 106 743
Foreign currency translation
reserve - 2 335 2 335
Shares issued 33 340 - 33 340
Balance at 31 December 2003 874 389 753 320 1 627 709
Net income for the period - 57 878 57 878
Foreign currency translation
reserve - 2 133 2 133
Dividend - (273 353) (273 353)
Capital reduction (869 575) - (869 575)
4 814 539 978 544 792
Fair value gains and losses
six months six months year ended
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Write up/(down) Johnnic/MTN 17 938 (5 453) 141 576
Write up Metropolitan 22 950 37 767 27 267
Write up Kaya SPV`s 6 388 - -
47 276 32 314 168 843
Net profit/(write-down) of investments and loans
six months six months year ended
30-Jun-04 30-Jun-03 31-Dec-03
R000 R000 R000
Profit on sale of Radmark 10 720 - -
Loss on sale of Urban Brew Studios (1 292) - -
Loss on sale of New Africa Books (5 041) - -
Provision for write down of
P4 Loans - (6 967) (6 967)
Provision for write down African
Bank Debtors Book - - (4 558)
4 387 (6 967) (11 525)
DIRECTORS: A S Mabogoane (Non-executive Chairman), S Macozoma, T Curtis,
Prof M M Katz, J T Mdlalose, G T Serobe, G Snelgar, Prof G Williams,
R Kevan, K Setzin, G Chadwick, L Mojela, M Ngoasheng, F Titi
COMPANY SECRETARY: R Kevan
Date: 29/09/2004 04:41:28 PM Produced by the JSE SENS Department
