| Tue 2 Nov 2004, 10:42 | | Abridged Report For The Year Ended 31 March 2004 |
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JCI Limited - Abridged Report For The Year Ended 31 March 2004 And Details Of
Annual General Meeting (`AGM`)
JCI LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 1894/000854/06)
Share code: JCD ISIN: ZAE000039681
Debenture code: JCDD ISIN: ZAE000039699
(`JCI` or `the Group` or `the Company`)
ABRIDGED REPORT FOR THE YEAR ENDED 31 MARCH 2004 AND DETAILS OF ANNUAL GENERAL
MEETING (`AGM`)
Shareholders are referred to the reviewed provisional results for the year ended
31 March 2004 and withdrawal of cautionary announcement published on SENS on 14
July 2004 (`reviewed provisional results`). In terms of 3.21 of the JSE
Securities Exchange (`JSE`) Listings Requirements, as the 2004 annual report was
despatched to shareholders on Friday, 29 October 2004 and contains changes to
the reviewed provisional results, this abridged report is published.
CONSOLIDATED INCOME STATEMENTS (ABRIDGED)
Audited Reviewed Audited
year year year
ended ended ended
31-Mar 31-Mar 31-Mar
2004 2004 2003
Notes R` 000 R` 000 R` 000
Revenue 227,790 171,082 219,486
Operating (loss)/profit (100,788) (60,894) 264,439
Investment income 1 5,956 4,889 1,713
Finance costs 2 (131,521) (100,179) -113,061
Share of earnings from
associates 184,325 184,337 43,895
Net profit/(loss) for the
period before taxation (42,028) 28,153 196,986
Taxation 3 (13,350) (13,350) (186)
Net (loss)/profit after
taxation (55,378) 14,803 196,800
Loss attributable to
outside shareholders 95 95 194
Net profit/(loss) for the
year (55,283) 14,898 196,994
(Loss)/Earnings per share -
cents 4
Headline (10.6) (4.8) 6.4
Attributable (3.1) 0.8 14.7
Diluted headline (7.0) 2.6 7.5
Diluted attributable (0.6) 14.8
Notes to the income
statements
1 Investment income
-interest received 5,956 4,889 1,713
2 Finance costs
-debenture interest 42,206 42,206 30,197
- other borrowings 89,315 57,973 82,864
131,521 100,179 113,061
3 Taxation
- normal taxation 12,500 12,500 -
- deferred taxation 850 850 -
- foreign normal taxation - - 186
13,350 13,350 186
4 (Loss)/earnings per share
The calculation of attributable (loss)/earnings per share
is based on a loss of R55 283 000
(2003:-profit of R196 994
000) and the
weighted average number of
1 793 477 247 (2003- 1 336
956 177) shares
in issue throughout the
year.
The calculation of the
headline (loss)/earnings
per share is based on a
loss of R189 313 000
(2003:-profit of R85 580
000) and the
weighted average number of
1 793 477 247 (2003- 1 336
956 177) shares
in issue throughout the
year.
Headline (loss)/earnings
are calculated as follows:
Net (loss)/profit for the
year (55,283) 14,898 196,994
Profit on liquidation and
sale of subsidiaries (42,088) 8,558 -
Unclaimed dividends written
back (425) (425) -
Profit on sale of
investments (170,292) (129,708) (129,924)
Additional costs in terms
of the restructuring of JCI
Gold Limited effective 1
July 1998 15,000 -
Reversal of interest - (21,753)
Goodwill amortised 24,957 20,965 40,547
Goodwill impaired 27,143 -
Profit on sale of property,
plant and equipment -825 (1,660) (284)
Gross (201,813) (86,522) 85,580
Taxation effect 12,500 -
Headline (loss)/earnings (189,313) (86,522) 85,580
The calculation of the diluted attributable (loss)/earnings per share is based
on an adjusted loss of R13 077 000 (2003 - profit of R227 191 000), being the
loss of R55 283 000 (2003- profit of R196 994 000) adjusted for interest on
debentures of R42 206 000 (2003- R30 197 000) and a weighted average number of
2 100 777 271 (2003 - 1 539 256 201) shares in issue throughout the year, on
the assumption that all the debentures are converted into ordinary shares.
The calculation of the diluted headline (loss)/earnings per share is based on
an adjusted headline loss of R147 107 000 (2003 - profit of R115 777 000),
being the headline loss of R189 313 000 (2003 - profit of R85 580 000) adjusted
for interest on debentures of R42 206 000 (2003 - R30 197 000) and a weighted
average number of 2 100 777 271 (2003 - 1 539 256 201) shares in issue
throughout the year, on the assumption that all the debentures are converted
into ordinary shares.
CONSOLIDATED BALANCE SHEETS (ABRIDGED)
Audited Reviewed Audited
31-Mar 31-Mar 31-Mar
2004 2004 2003
R` 000 R` 000 R` 000
ASSETS
Non - current assets
- Property, mineral
rights, plant and
equipment 349,188 349,453 105,569
- Goodwill 42,900 46,892 71,746
- Investments 1,047,787 1,101,939 1,023,805
- Other non-current assets 417,587 97,866 349,308
1,857,462 1,596,150 1,550,428
Current assets 650,309 986,653 263,684
Total assets 2,507,771 2,582,803 1,814,112
EQUITY AND LIABILITIES
- Capital and reserves 740,935 801,909 822,522
- Treasury shares (39,200) (39,200) (54,416)
- Outside shareholders - 3 22
701,735 762,712 768,128
Non-current borrowings
- interest bearing 677,078 677,078 327,977
- non interest bearing 6,493 6,493 1,502
683,571 683,571 329,479
Current liabilities
- interest bearing 901,133 827,298 513,030
- non interest bearing 221,332 309,222 203,475
1,122,465 1,136,520 716,505
Total liabilities and
equity 2,507,771 2,582,803 1,814,112
Number of shares in issue 2,089,503,652 2,089,503,622 1,750,566,255
Less treasury shares 112,000,000 112,000,000 133,705,854
Net shares issued 1,977,503,652 1,977,503,622 1,616,860,401
Net asset value per share
(cents) 36 39 48
CASH FLOW STATEMENTS (ABRIDGED)
Audited Reviewed Audited
year year year
ended ended ended
31-Mar 31-Mar 31-Mar
2004 2004 2003
R` 000 R` 000 R` 000
Cash flows from operating activities (363,962) (325,900) 27,612
Cash flows from investing activities (166,578) (13,089) (67,266)
Cash flows from financing activities 641,963 450,412 61,703
Net (decrease)/increase in cash and
cash equivalents 111,423 111,423 22,049
Cash and cash equivalents of acquired
subsidiaries 18,709 18,709 371
Cash and cash equivalents at beginning
of year (2,712) (2,712) (25,132)
Cash and cash equivalents at end of
year 127,420 127,420 (2,712)
STATEMENT OF CHANGES IN EQUITY
Non-
Share Share distributable
capital premium reserves
R` 000 R` 000 R` 000
Balance on 31 March 2002 7,117 1,046,278 285,588
Issued during the year 10,389 457,084
Share issue expenses written-off (5,265)
Net profit for the year
Transfer from non-distributable
reserve to accumulated loss (37,976)
Share of fair value adjustment of
associated companies
Acquisitions
Balance on 31 March 2003 17,506 1,498,097 247,612
Change in accounting policy - AC 133
Restated opening balances 17,506 1,498,097 247,612
Issued during the year 3,389 211,647
Share issue expenses written-off (323)
Transfer from non-distributable
reserve to accumulated loss (8,764)
Net loss for the year
Dilution of holding in associate
companies
Share of fair value adjustment of
associated companies
Disposals
20,895 1,709,421 238,848
Accumulated Treasury
loss Shares Total
R` 000 R` 000 R` 000
Balance on 31 March 2002 (1,068,598) (24,341) 246,044
Issued during the year 467,473
Share issue expenses written-off (5,265)
Net profit for the year 196,994 196,994
Transfer from non-distributable
reserve to accumulated loss 37,976 -
Share of fair value adjustment of
associated companies (107,065) (107,065)
Acquisitions (30,075) (30,075)
Balance on 31 March 2003 (940,693) (54,416) 768,106
Change in accounting policy - AC 133 (46,657) (46,657)
Restated opening balances (987,350) (54,416) 721,449
Issued during the year 215,036
Share issue expenses written-off -323
Transfer from non-distributable
reserve to accumulated loss 8,764 -
Net loss for the year (55,283) (55,283)
Dilution of holding in associate
companies 32,128 32,128
Share of fair value adjustment of
associated companies (226,488) (226,488)
Disposals 15,216 15,216
(1,228,229) (39,200) 701,735
Balance on 31 March 2004
NOTES TO THE BALANCE SHEET
1 Basis of accounting
These results are prepared in accordance with South African Statements of
Generally Accepted Accounting Practice (`GAAP`) and schedule 4 of the
Companies Act. These accounting policies are consistent with those used in the
annual financial statements for this year ended 31 March 2003, except as noted
below.
- During the year the Group adopted AC 133 : Financial Instruments :
Recognition and Measurement. In accordance with the adoption provisions of AC
133, an adjustment has been made to the Groups accumulated losses at the
beginning of the year and no adjustment has been made to prior year figures.
- The Group changed its accounting policy with respect to the treatment of its
Share Incentive Trust. In accordance with the JSE Listings Requirements, the
Group has now consolidated its
Share Incentive Trust. The comparative amounts have been appropriately restated
2 Investments in Associate Companies
Investments in associated companies are accounted for on the equity accounting
method and carrying values are disclosed after the amortisation of any goodwill
arising on the acquisition of the investments.
Reviewed Audited Audited
year ended year ended year ended
31-Mar 31-Mar 31-Mar
2004 2004 2003
R` 000 R` 000 R` 000
Investments at carrying value
Listed investments
-associated companies 608,482 608,482 710,662
-other 90,806 85,013 4,714
Unlisted investments
-associated companies 298,526 197,668 167,731
-other 104,126 156,626 140,698
Market value of listed investments
-associated companies 1,508,497 1,508,497 1,508,177
-other 90,806 85,013 4,362
Directors valuation of unlisted investments
-associated companies 323,736 229,113 167,731
-other 104,126 156,626 140,698
3 Current assets
Current assets include deposits and cash of R 127 420 000 (2003: R32 414 000)
4 Debentures
Included in non-current interest bearing borrowings is an amount of R384 125
000 (2003: R252 875 000) which relates to the 307 300 024 (2003: 202 300 024)
convertible redeemable 50% secured debentures issued at R1.25 each (`the
debentures`), the terms of which were set out in the debenture certificate
attached as Annexure 19 of the JCI circular dated 4 June 2002.
5 Current liabilities
Current liabilities- interest bearing include bank overdrafts of R nil (2003:
R35 126 000).
6 Contingent liabilities
The Company is the defendant in the following legal actions, all of which are
being defended:
- co- defendant with Messrs RAR Kebble, J Stratton, HC Buitendag for a claim of
R77 800 000 and AUS$6 million involving Durban Roodepoort Deep, Limited (`DRD`)
- defendant for a claim of R1 050 000 in respect of a penalty in a land sale
agreement.
-defendant in a case relating to a ferronickel project where the plaintiff is
claiming a success fee equal to 1% of the project and 2% of the equity of the
project of which the monetary value has not been quantified.
- defendant for a claim of R52 000 000 in respect of a surety signed.
A subsidiary company is the defendant in a case where the plaintiff is claiming
AUS$2 500 000 relating to acquisition of shares by the subsidiary.
The Company has signed guarantees for the the repayment of inter-group loans in
favour of subsidiary companies: R1 098 735 000(2003: R1 226 407 000).
The Company has signed suretyships for:
- property mortgages of subsidiary companies: R10 875 000 (2003: R4 000 000)
- facilities granted to subsidiary companies: R14 000 000 (2003: R5 000 000)
- a loan granted to an associated company for R160 000 000.
In addition the Group has undertaken to follow its rights offer entitlement in
respect of its entire shareholding in Western Areas Limited (`WAL`), and the
Group has also underwritten the balance of the WAL rights offer, for which
irrevocable undertakings to subscribe for rights offer shares were not received.
As a result of this undertaking JCI was allotted a further 9,4 million shares at
an issue price of 3 050 cent per share on the 19 July 2004.
7 Post balance sheet events
Subsequent to year end the Company issued 12 800 000 shares at 66 cents per
share in order to fund an empowerment transaction. Judgment in the court case
with DRD was handed down on 21 October 2004 in favour of DRD in an amount of R35
709 800. The Company has given notice of application for leave to appeal against
the judgment.
COMMENTARY
The major changes in the figures published by the Company on 14 July 2004 in the
reviewed provisional results and those incorporated in the audited annual
financial statements of the Company
can be summarised as follows:
R`000
Income Statement
Settlement on amount payable by a subsidiary company
relating to taxation payable prior to it`s
restructuring during 1998 15,000
Provision by the Company for the amount payable in terms of a
judgement against the Company
subsequent to the financial tear end. The Directors have, based on
legal advice obtained given
notice of application for leave to appeal 26,595
Incorrect inplementation of AC 133 - transition provision, by a
foreign subsidiary 9,207
Adjustment to impairment of investments and goodwill 19,379
TOTAL 70,181
Balance Sheet
Other than the effects on the balance sheet items due to the income statement
adjustments detailed above, all other major differences relate to re-allocations
and reclassifications between various categories.
Group revenue increased from R219 million to R228 million, however the net
profit before taxation reduced from R197 million to a loss of R42 million.
The share is trading at a large discount to its Net Asset Value and the Board is
determined to address this discrepancy. It is the view of the directors that
the market will in due course appreciate the Group`s strategy, and will re-rate
the share.
JCI`s policy is to empower individuals and groupings so as to create as many new
capital bases as possible and to build partnerships that will lead to
sustainable value creation of the Company.
Approximately two thirds of the Group`s debt has been incurred in order to fund
empowerment and JCI is proud to have been a part of the creation of new value.
JCI`s confidence in this strategy is unshaken and JCI will in due course
announce the creation of a new capital base to be led by Western Areas Limited
chairman, Mafika Mkwanazi. Through this process approximately 75% of the
empowerment joint ventures established by JCI will be absorbed into a single
structure for ease of management and future development as a stand-alone listed
entity. This process will allow the Company to de-gear itself substantially.
ABRIDGED REPORT AND DISTRIBUTION OF ANNUAL FINANCIAL STATEMENTS
Shareholders are referred to the reviewed provisional results for the year ended
31 March 2004 and withdrawal of cautionary announcement published on SENS on 14
July 2004 (`reviewed provisional results`). In terms of 3.21 of the JSE
Listings Requirements, as the 2004 annual report was despatched to shareholders
today and contains changes to the reviewed provisional results, this abridged
report is published.
NOTICE OF ANNUAL GENERAL MEETING
The 2004 annual report contains the notice of AGM and shareholders are advised
that the AGM of JCI`s members will be held in the Auditorium, Ground Floor, 28
Harrison Street, Johannesburg, South Africa on Wednesday, 24 November 2004, at
10h00, to transact the business set out in the notice of meeting.
For and on behalf of the board:
R.B. Kebble H.C. Buitendag
Chief Executive Officer Financial Director
Johannesburg
1 November 2004
Company secretaries: Consolidated Mining Management Services Limited
Per: P B Beale
Registered office: 28 Harrison Street
Johannesburg, 2001
(PO Box 11165, Johannesburg, 2000)
Transfer secretaries : Computershare Investor Services 2004
(Proprietary) Limited
70 Marshall Street
Johannesburg, 2001
(PO Box 61051, Marshalltown, 2017)
Sponsor: Sasfin Corporate Finance, a division of Sasfin Bank Limited
United Kingdom Registrars: Capita Registrars
The Registry
34 Beckenham Road, Kent BR3 4TU
Telephone: +44 (0870) 162 3100
Telefax: +44 (20) 8639 2142
United Kingdom Secretaries: JCI (London) Limited
6 St James`s Place
London SW1A 1NP
Telephone: +9 44 20 7499 3916
Telefax: +9 44 20 7491 1989
Investor Relations: George Poole,
28 Harrison Street Johannesburg, 2001
(PO Box 11165, Johannesburg, 2000)
Telephone +27 11 688 5100
Telefax +27 11 836 3757
Date: 02/11/2004 09:57:25 AM
Produced by the JSE SENS Department
