| Wed 23 Feb 2005, 16:44 | | Interim Group Results For The 6 Months Ended 31 D |
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Transpaco Limited - Interim Group Results For The 6 Months Ended 31 December
2004
TRANSPACO LIMITEDReg. No. 1951/000799/06ISIN: ZAE000007480Share Code: TPCINTERIM
GROUP RESULTS FOR THE 6 MONTHS ENDED 31 DECEMBER 2004
HIGHLIGHTS INCREASE
HEADLINE EARNINGS PER SHARE 48,7c 15%
DIVIDEND PER SHARE 8c 14%
NAV PER SHARE 392c 18%CONSOLIDATED INCOME
STATEMENT
Unaudited Unaudited Audited
6 months 6 months % 12 months
R`000 Dec 2004 Dec 2003 Change Jun 2004
Turnover 170 340 157 904 8 300 796
Cost of sales 110 258 101 578 9 193 651
Gross Profit 60 082 56 326 7 107 145
Operating Costs 35 728 33 585 6 67 309
Depreciation 5 994 4 915 22 10 277
Operating Income 18 360 17 826 3 29 559
Net interest paid 1 042 1 542 (32) 2 871
Income before taxation 17 318 16 284 6 26 688
Taxation 3 929 4 254 (8) 6 693
Current taxation 2 609 2 577 4 670
Deferred taxation 898 1 102 1 179
Secondary taxation on 422 575 844
companies
Income after taxation 13 389 12 030 11 19 995
Weighted average number of 27 319 27 823 27 239
shares in issue (`000)
Diluted weighted average 29 375 29 878 29 203
number of shares in issue
(`000)
Earnings per share (cents) 49.0 43.2 13 73.4
Diluted earnings per share 45.6 40.3 13 68.5
(cents)
Headline earnings per share 48.7 42.3 15 71.8
(cents)
Diluted headline earnings 45.3 39.4 15 67.0
per share (cents)
Dividend per share (cents)* 8.0 7.0 18.0
Reconciliation of headline
earnings (R`000)
Basic earnings 13 389 12 030 19 995
Profit on disposal of plant (85) (263) (426)
and equipment
Headline earnings 13 304 11 767 13 19 569
*Dividend declared after the periodCONSOLIDATED BALANCE SHEET
Unaudited Unaudited Audited
6 months 6 months 12 months
R`000 Dec 2004 Dec 2003 Jun 2004
ASSETS
Non-current assets 79 148 67 598 67 508
Property, plant and equipment 78 566 66 984 66 908
Intangibles 582 614 600
Current assets 123 881 97 927 104 741
Inventories 37 048 22 932 28 104
Accounts receivable 79 312 73 513 57 930
Taxation 2 760 1 436 3 493
Cash resources 4 761 46 15 214
TOTAL ASSETS 203 029 165 525 172 249
EQUITY AND LIABILITIES
Capital and reserves 107 275 91 980 96 747
Issued capital 276 278 275
Reserves 1 688 1 688 1 688
Accumulated profit 105 311 90 014 94 784
Non-current liabilities 31 509 25 300 19 116
Interest bearing borrowings 27 488 22 253 15 993
Deferred taxation 4 021 3 047 3 123
Current liabilities 64 245 48 245 56 386
Trade and other payables 56 619 37 566 49 144
Bank overdraft 0 738 0
Current portion of interest 7 626 9 941 7 242
bearing borrowings
TOTAL EQUITY AND LIABILITIES 203 029 165 525 172 249
Number of shares in issue `000 `000 `000
Number of shares in issue 27 214 28 089 27 786
(net of 3 338 854 treasury
shares)
Net movement on treasury shares 139 (322) (572)
Ranking number of shares 27 353 27 767 27 214
Salient features
Net asset value per share 392 331 356
(cents)
Gearing ratio % 28 36 8
Shareholders Funds: Total 54 56 62
assets %
Interest cover (x) 17.6 11.6 10.3
Operating margin % 10.8 11.3 9.8
ABRIDGED CONSOLIDATED CASH FLOW
Unaudited Unaudited Audited
6 months 6 months 12 months
R`000 Dec 2004 Dec 2003 Jun 2004
Cash flow from operating
activities
Cash generated from 1 418 3 898 42 819
operations
Dividend paid (3 050) (4 165) (6 106)
Finance charges (1 042) (1 542) (2 871)
Taxation paid (2 298) (1 362) (5 781)
Net cash flow from operating (4 972) (3 171) 28 061
activities
Cash flow from investing
activities
Proceeds on disposal plant 158 870 2 006
and equipment
Acquisition of plant and (17 707) (18 231) (24 477)
equipment
Net cash flow from investing (17 549) (17 361) (22 471)
activities
Cash flow from financing
activities
Increase in long term 11 495 9 544 3 284
borrowings
Increase in short term 384 3 161 462
borrowings
Employee compensation reserve 0 0 (130)
Net movement on treasury 189 (976) (2 103)
shares
Net cash flow from financing 12 068 11 729 1 513
activities
Net movement in cash for the (10 453) (8 803) 7 103
period
Cash and cash equivalents at 15 214 8 111 8 111
the beginning of the year
Cash and cash equivalents at 4 761 (692) 15 214
the end of the period
STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited Audited
6 months 6 months 12 months
R`000 Dec 2004 Dec 2003 Jun 2004
Opening balance 96 747 85 091 85 091
Earnings attributable to 13 389 12 030 19 865
shareholders
Dividend paid (3 050) (4 165) (6 106)
Net movement on treasury 189 (976) (2 103)
shares
Closing balance 107 275 91 980 96 747
NATURE OF BUSINESSTranspaco is a leading plastic products and packaging
manufacturer, recycler and distributor.BUSINESS REVIEWThe board is pleased to
report results reflecting an increase in headline earnings per share of 15% to
48,7 cents (Dec 2003: 42,3 cents)
Turnover increased by 8% to R170 million (Dec 2003: R158 million), mainly
attributable to volume growth and to a lesser extent price increases. The
increase in turnover and the containment of manufacturing expenses, neutralised
the effect of the raw material price increases, which proved difficult to pass
on in light of a low inflationary environment.
Low cost import competition further placed pressure on the group`s margins which
were reduced to maintain market share.
Operating costs were well managed. Depreciation grew by 22% due to plant
expansions at the Recycling and Rigid divisions.
Net interest paid decreased by 32% to R1,0 million (Dec 2003: R1,5 million)
resulting from strong cash management.
Interest cover increased to 17,6 times (Dec 2003: 11,6 times).
Tax payable reduced by 8% to R3,9 million (Dec 2003: R4,3 million) due to the
tax holiday enjoyed by our facility in KwaNdebele.
The establishment of a pallet wrap and cast polypropylene division (Specialised
Films) in November accounted for an increase in Property, Plant and Equipment of
17% to R78 million (Dec 2003: R67 million).
The increase in inventory levels is due to:
- the explosion at Transpaco`s major raw material supplier which raised
concerns of a raw material shortage, necessitating increased inventory
levels;
- an average increase of 50% in the cost of raw materials during the
year;
- the establishment of the new Specialised Films division.
PROSPECTSTranspaco`s expansion into the Specialised Film division came on stream
during November with sales exceeding expectations. The board is optimistic that
this development will provide growth for the group in the years ahead.
Margins continue to be under pressure with management making a concerted effort
to alleviate the negative effects of the high raw material prices and low cost
import competition.
Notwithstanding that the manufacturing sector is under pressure, Transpaco
remains optimistic in achieving its objectives of attaining real earnings growth
for the 2005 financial year.BEE INITIATIVE AND PROPOSED ACQUISITION
As recorded in the cautionary announcement dated 15 February 2005:
- Transpaco continues to be involved in negotiations with a BEE party
which if finalised will transform Transpaco into a broad based black
economic empowered entity;
- negotiations are at an advanced stage for the acquisition of a
packaging entity, details of which will be made available at the
appropriate time. If the transaction is finalised the acquisition will
add further growth to the group.
DIVIDEND
The board has declared an interim dividend of 8 cents per share to shareholders
recorded in the register on Friday 1 April 2005 payable on Monday 4 April 2005.
The last day to trade `cum` dividend will be Wednesday, 23 March 2005. Shares
will commence trading `ex` dividend from the commencement of business on
Thursday, 24 March 2005. The record date will be Friday, 1 April 2005. Share
certificates may not be dematerialised or rematerialised between Thursday, 24
March 2005 and Friday, 1 April 2005, both days inclusive.BASIS OF
ACCOUNTINGThese unaudited results are prepared in accordance with South African
statements of Generally Accepted Accounting Practice, the Companies Act and the
listing requirements of the JSE Securities Exchange South Africa. The accounting
policies used are consistent in all material respects with those applied in the
audited financial statements for the year ended June 2004. ON BEHALF OF THE
BOARDAJ Aaron PN Abelheim L WeinbergNon-
executive Chairman Chief Executive Financial Director
DATE 23 February 2005DirectorsAJ Aaron* (Chairman); PN Abelheim (Chief
Executive); HA Botha; JS Botha; SR Bouzaglou; SL Chaitel; DR Hilewitz*; SI
Jacobson*; AC Salomon*; SP van der Linde*; L Weinberg
*non-executive
Website www.transpaco.co.zaAuditors Ernst & YoungSponsor Investec Bank
LimitedRegistered Office 331 6th Street, Wynberg, SandtonTransfer Secretaries
Computershare Investor Services 2004 (Pty) Ltd70 Marshall Street, Johannesburg
Date: 23/02/2005 04:06:32 PM
Produced by the JSE SENS Department
