| Mon 14 Feb 2005, 15:28 | | RESULTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004 |
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ASSMANG LIMITED - INTERIM RESULTS
ASSMANG LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1935/007343/06)
Share code: ASG ISIN: ZAE000030789
(`the Company` or `the Group`)
INTERIM RESULTS FOR THE HALF-YEAR ENDED 31 DECEMBER 2004
SALIENT FEATURES
* Turnover increases by 42 percent
* Headline earnings for the six months increase from
R4,0 million to R353,0 million
* Significant increases in US$ commodity prices
* Significant increases in manganese ore sales volumes
* First production from the Dwarsrivier underground mine
Group balance sheet
(Unaudited) (Audited)
At 31 December At 30 June
2004 2003 2004
R`000 R`000 R`000
ASSETS
Non-current assets
Property, plant and equipment 2 549 870 2 199 587 2 395 331
Deferred tax assets 5 579 9 797 4 972
Environmental rehabilitation
trust fund 18 617 13 069 18 617
Current assets
Inventories 1 183 380 965 947 889 164
Trade and other receivables 753 113 652 430 908 562
Taxation - 20 402 -
Cash and cash equivalents 9 264 5 894 9 951
Total assets 4 519 823 3 867 126 4 226 597
EQUITY AND LIABILITIES
Total shareholders` interest 2 815 057 2 274 866 2 480 226
Non-current liabilities
Long-term borrowings 14 285 - 14 285
Deferred tax liabilities 594 161 472 833 527 587
Long-term provisions 69 810 35 709 63 830
Current liabilities
Trade and other payables 357 660 343 576 388 788
Overdrafts and short-term
borrowings 567 415 740 142 737 190
Taxation 101 435 - 14 691
Total equity and liabilities 4 519 823 3 867 126 4 226 597
Group income statement
(Audited)
(Unaudited) Year
Half-year ended ended
31 December 30 June
2004 2003 2004
R`000 R`000 R`000
Turnover 1 887 339 1 332 706 3 304 537
Net operating profit before
depreciation 688 795 132 773 560 140
Depreciation 120 800 80 709 167 829
Operating profit 567 995 52 064 392 311
Interest received 618 950 1 734
Finance costs 33 132 34 064 51 741
Profit before exceptional item 535 481 18 950 342 304
Exceptional item 7 647 - -
Profit before taxation and
State`s share of profit 543 128 18 950 342 304
Taxation and State`s share
of profit 181 685 14 858 123 981
Earnings 361 443 4 092 218 323
Determination of headline
earnings
Earnings (as above) 361 443 4 092 218 323
Profit on disposal of assets 8 423 134 4 502
Headline earnings 353 020 3 958 213 821
Number of ordinary shares
in issue (`000) 3 548 3 548 3 548
Earnings per share (cents)
- Attributable 10 187 115 6 026
- Headline 9 949 112 6 153
Dividends paid per share (cents) 750 500 750
Group cash flow statement
(Audited)
(Unaudited) Year
Half-year ended ended
31 December 30 June
2004 2003 2004
R`000 R`000 R`000
CASH FLOW FROM OPERATING
ACTIVITIES
Cash generated from operations 525 080 73 922 389 884
Interest received 618 950 1 734
Interest paid (34 100) (34 064) (70 003)
Dividends paid (26 612) (17 741) (26 612)
Taxation paid (28 978) (28 473) (42 952)
Net cash in/(out)-flow from
operating activities 436 008 (5 406) 252 051
CASH FLOW FROM
INVESTING ACTIVITIES
Additions to fixed assets to
maintain operations (285 695) (208 099) (458 105)
Proceeds on disposal of mineral
rights and other assets 18 775 134 6 217
Net cash out-flow from
investing activities (266 920) (207 965) (451 888)
CASH FLOW FROM
FINANCING ACTIVITIES
Long-term borrowings
repaid - (3) (3)
(Decrease)/increase in overdrafts
and short-term borrowings (169 775) 216 106 206 629
Net cash (out)/in-flow from
financing activities (169 775) 216 103 206 626
Net (decrease)/increase
in cash and cash equivalents (687) 2 732 6 789
Cash and cash equivalents
at beginning of period 9 951 3 162 3 162
Cash and cash equivalents
at end of period 9 264 5 894 9 951
Segment information
Iron ore Manganese Chrome
Division Division Division Total
R`000 R`000 R`000 R`000
Primary segmental
information
Half-year to
31 December 2004
(unaudited)
Turnover 316 822 1 112 302 458 215 1 887 339
Contribution to earnings 6 973 333 737 20 733 361 443
Contribution to headline
earnings 6 973 332 961 13 086 353 020
Primary segmental
information
Half-year to
31 December 2003
(unaudited)
Turnover 298 308 632 696 401 702 1 332 706
Contribution to earnings 14 454 52 264 (62 626) 4 092
Contribution to headline
earnings 14 454 52 130 (62 626) 3 958
Primary segmental
information
Year to 30 June 2004
(audited)
Turnover 643 547 1 587 492 1 073 498 3 304 537
Contribution to earnings 11 085 232 117 (24 879) 218 323
Contribution to headline
earnings 8 010 230 935 (25 124) 213 821
Group statement of changes in shareholders` equity
Stated Retained
capital earnings Total
R`000 R`000 R`000
Balance at beginning of period
(audited) 13 385 2 466 841 2 480 226
Earnings for the period - 361 443 361 443
Ordinary dividends paid - (26 612) (26 612)
Balance at end of period
(unaudited) 13 385 2 801 672 2 815 057
Commentary
Results
Attributable earnings for the period under review increased substantially over
that of the corresponding period in the previous year to R361,4 million (2003:
R4,1 million) which equates to R101,87 per share (2003:R1,15 per share).
Attributable earnings include profits on the sale of certain chrome mineral
rights, on the Company`s farm Dwarsrivier, to Samancor Limited for a net R7,6
million.
Headline earnings also increased substantially to R353,0 million (2003: R4,0
million) which equates to R99,49 per share (2003:R1,12 per share).
The increase in attributable and headline earnings can be primarily attributed
to positive market conditions over the past six months mainly in terms of
manganese alloy prices, significant increase in sales volumes of man- ganese
ore and to a lesser extent successful cost saving exercises at the Group`s
operations.
The Group`s turnover for the half-year ended 31 December 2004 increased by 41,6
per cent to R1 887,3 million (2003: R1 332,7 million). Sales volumes for the
period under review are detailed in the table below:
Six months ended %
31 December Volume
2004 2003 Increase/
(tons) (tons) (decrease)
Manganese ore* 767 986 662 867 16
Iron ore 2 540 595 2 493 824 2
Manganese alloys 105 272 113 452 (7)
Charge chrome 104 371 126 860 (18)
*Excluding sales to the Company`s Cato Ridge Works
Major capital projects
The Company continued its capital expenditure programme, spending R285,7
million (2003: R208,1 million) during the period under review including
capitalised interest of R1,0 million (2003:R7,5 million). Of this R110,4 mil-
lion was spent on the new shaft complex at the Nchwaning manganese mine, which
commenced production during the current financial year. Production is in the
process of being ramped up. The total capital cost of this project is estimated
to be R748,0 million, excluding capitalised interest. A further R31,4 million
was spent on the construction of the Dwarsrivier underground chrome mine, which
commenced with the initial phases of production during January 2005.
Current projects underway within Assmang`s growth strategy include:
* The final commissioning of the Nchwaning shaft complex;
* The completion of the underground mine at Dwarsrivier to replace the existing
opencast mine, which is expected to be completed during the 2005/2006 financial
year; and
* The development of additional mineable reserves at the iron ore division,
which includes an additional open cast mining area at the Company`s Beeshoek
mine, as well as a feasibility study that is underway to assess the viability
of the vast resources north of the Beeshoek mine on the Bruce, King and
Mokaning properties.
Commitments for future capital expenditure, which will be funded from cash
generated and available borrowing resources, are summarised below:
(Unaudited) (Audited)
at 31 December at 30 June
2004 2003 2004
R`000 R`000 R`000
Commitments for future
capital expenditure
- contracted for 55 671 145 614 112 640
- authorised but not
contracted for 324 874 238 447 328 837
380 545 384 061 441 477
Borrowings
Short-term borrowings at 31 December 2004 decreased by R172,7 million to R567,4
million (2003: R740,1 million), which is well within the Groups borrowing
capacity.
Outlook for the next six months
Sales volumes of the Group`s products remain fairly buoyant and tonnages are
expected to exceed those of the period under review. Manganese and iron ore
prices for the next six months are expected to be higher than those achieved
during the previous six months whilst manganese alloy prices are expected to be
lower. Earnings growth will, however, be dependent on the R/US dollar exchange
rate and continuing cost saving measures at the Group`s divisions.
Dividends
The results include a final dividend of R7,50 per share, which was paid on 13
September 2004.
Given the Company`s improved results and cash flow position, which has resulted
from the significant increase in earnings, an interim dividend of R18,00 per
share (2003: R2,50 per share) has been declared since 31 December 2004 but is
not included in these results in this announcement in accordance with the
Group`s accounting policy for dividends.
Accounting policies
The financial information included in this announcement has been prepared in
accordance with Statements of Generally Accepted Accounting Practice in South
Africa and International Financial Reporting Standards. The accounting policies
are consistent with those used previously.
The interim financial statements of the Group have been prepared in accordance
with International Financial Reporting Standards (IAS 34), South African
Statements of Generally Accepted Accounting Practice (AC127), in compliance
with the listings requirements of the JSE Securities Exchange South Africa and
in the manner required by the Companies Act, 1973, as amended.
Contingent Liability
A termination account, in the case of a contractor that went into liquidation
in 2004, is in the process of being drawn. This account will deal with claims
and counterclaims between the Company and the contractor in liq- uidation. The
ultimate outcome of the matter cannot presently be determined, and no provision
for any liability that may result has been made in these interim results.
Directorate
With effect from 20 January 2005 Messrs R P Menell and M Arnold resigned as
directors of the Company. Messrs A J Wilkens and F Abbott were appointed in
their stead.
Messrs M W Gule and M Arnold were appointed as alternate directors to Messrs A
J Wilkens and F Abbott respectively.
Dividend announcement
Notice is hereby given that an interim dividend No.131 of R18,00 per share has
been declared payable to members. The dividend has been declared in the
currency of the Republic of South Africa.
In accordance with STRATE, the following dates and salient features apply to
the interim dividend:
* The last date to trade to qualify for the dividend (and for changes of
address or dividend instructions) will be Friday, 4 March 2005.
* The Company`s ordinary shares will commence trading (`ex` the dividend)
from the commencement of business on Monday, 7 March 2005.
* The record date will be Friday, 11 March 2005.
* Dividend cheques in payment of this dividend to certificated shareholders
will be posted on or about Monday, 14 March 2005. Electronic payment to
certificated shareholders will be undertaken simultaneously.
* Dematerialised shareholders will have their accounts at their Central
Securities Depository Participant or broker credited on Monday, 14 March
2005.
* Share certificates may not be dematerialised or rematerialised between
Monday, 7 March 2005 and Friday, 11 March 2005, both days inclusive.
By order of the board
AFRICAN RAINBOW MINERALS LIMITED
Secretaries
per: A Jepson
14 February 2005
Directors: Desmond Sacco (Chairman), AJ Wilkens (Deputy Chairman),
RJ Carpenter, CJ Cory, PC Crous, F Abbott, BR Broekman, JC Steenkamp.
Alternate directors: PGW Henderson, AD Stalker*, JW Lewis*, WM Gule,
GC Butler*, M Arnold, FH Kalp, A McAdam*. *British
Company secretary: African Rainbow Minerals Limited
Registered office: 24 Impala Road, Chislehurston, 2196
Date: 14/02/2005 03:25:51 PM
Produced by the JSE SENS Department
