| Wed 18 May 2005, 17:02 | | RESULTS FOR THE YEAR ENDED 31 MARCH 2005 |
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Bearing Man - Group audited results and dividend announcement for the year ended
31 March 2005 and further cautionary announcement
Bearing Man Ltd
AFRICA`S FOREMOST DISTRIBUTOR OF DYNAMIC ENGINEERING CONSUMABLES
Share code: BRM ISIN: ZAE000001137
(Incorporated in the Republic of South Africa)
Registration number 1955/002109/06
GROUP AUDITED RESULTS AND DIVIDEND ANNOUNCEMENT FOR THE YEAR ENDED 31 MARCH
2005 AND FURTHER CAUTIONARY ANNOUNCEMENT
REVENUE +4% OPERATING PROFIT +4% EARNINGS +10%
Income Statement
Year Year
ended ended
31 March 31 March Inc/
2005 2004 (Dec)
R000 R000 %
Revenue 1 048 087 1 009 305 4
Operating profit 144 562 138 980 4
Interest 3 333 10 649 (69)
Profit before taxation 141 229 128 331 10
Taxation 47 703 43 270 10
Earnings for the year 93 526 85 061 10
Determination of headline earnings
Earnings 93 526 85 061 10
Adjustments - after tax where applicable
- Amortisation of goodwill - 300
- Profit on disposal of property, plant
and equipment (895) (1 175)
Headline earnings 92 631 84 186 10
Shares in issue
Weighted average (000`s) 113 155 111 739
At end of period (000`s) 113 155 113 155
Weighted average including diluted shares
(000`s) 114 705 114 798
Earnings per share (cents) 82,7 76,1 9
Headline earnings per share (cents) 81,9 75,3 9
Diluted earnings per share (cents) 81,0 73,5 10
Diluted headline earnings per share
(cents) 80,2 72,7 10
Dividends per share * 33,0 36,0 (8)
Interim (cents) 13,0 11,0 18
Final (cents) 20,0 25,0 (20)
* In accordance with Generally Accepted Accounting Practice Statement AC 107
the final dividend of 20 cents per share proposed by the directors has not been
reflected in the financial statements.
Cash Flow Statement
Year ended Year ended
31 March 31 March
2005 2004
R000 R000
CASH FLOWS FROM OPERATING ACTIVITIES
Cash receipts from customers 1 183 671 1 154 586
Cash paid to suppliers and employees 1 025 625 1 014 992
Cash flows from operating activities 158 046 139 594
Interest paid (4 696) (10 585)
Taxation paid (52 455) (68 621)
Dividends paid (42 999) (38 857)
Net cash generated by operating activities 57 896 21 531
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property, plant and equipment
to maintain operations (17 933) (18 563)
Business acquisitions (18 850) -
Proceeds on disposal of property, plant and
equipment 7 164 5 360
Net cash utilised in investing activities (29 619) (13 203)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of unsecured loans (1 818) (1 606)
Repayment from staff incentive trust participants - 7 871
Debenture - net transactions (599) (737)
Net cash (utilised in)/generated from financing
activities (2 417) 5 528
NET INCREASE IN CASH AND CASH EQUIVALENTS 25 860 13 856
Cash and cash equivalents at beginning of year (24 130) (37 986)
Cash and cash equivalents at end of year 1 730 (24 130)
Balance Sheet
31 March 31 March
2005 2004
R000 R000
ASSETS
Non-current 95 318 94 349
Property, plant and equipment 80 948 84 122
Intangible assets 6 087 1 875
Deferred tax 2 595 2 664
Loan to Staff Incentive Trust Participants 5 688 5 688
Current 487 020 440 676
Inventories 321 135 297 860
Trade and other receivables 152 136 139 744
Bank balances and cash 11 411 2 774
Taxation 2 338 298
582 338 535 025
EQUITY AND LIABILITIES
Shareholders` interest 381 658 331 131
Non-current liabilities 6 272 9 005
Long-term borrowings 4 924 7 058
Debentures 1 348 1 947
Current liabilities 194 408 194 889
Bank overdrafts and bankers` acceptances 9 681 26 904
Short-term borrowings 2 140 1 824
Trade and other payables 180 874 161 667
Taxation 1 713 4 494
582 338 535 025
Net debt: equity (%) 2,2% 10,6%
Net asset value per share (cents) 337 293
Net tangible asset value per share (cents) 332 291
Changes in Equity Statement
Year ended Year ended
31 March 31 March
2005 2004
R000 R000
Stated capital
Balance at beginning of year 62 742 57 031
Issued during the year on conversion of debentures - 5 730
Share issue expenses - (19)
Balance at end of year 62 742 62 742
Retained income
Balance at beginning of year 265 561 219 357
Earnings for the year 93 526 85 061
Dividends - prior year final (28 289) (26 410)
- current year interim (14 710) (12 447)
Balance at end of year 316 088 265 561
Debentures
Balance at beginning of year 2 828 5 686
Transferred from debenture liability on conversion - 1 721
Converted into shares - (5 730)
Redeemed - (263)
Issued during the year - 1 414
Balance at end of year 2 828 2 828
Total shareholders` interest 381 658 331 131
* In accordance with Generally Accepted Accounting Practice Statement AC 107
the final dividend of 20 cents per share proposed by the directors has not
been reflected in the financial statements.
Nature of business
The group is Southern Africa`s largest distributor of a comprehensive range of
ball and roller bearings, seals, power transmission products, geared motors,
belting, fasteners and related products. Its base of customers covers a broad
spectrum of industry, including mining, steel, paper and pulp, and agriculture.
Financial review
Turnover increased by 4% representing real growth in a deflationary
environment and operating profit similarly increased by 4% to R144,6 million.
Earnings for the year increased by 10% to R93,5 million and earnings per share
by 9% to 82,7 cents per share.
Cash generated by operating activities amounted to R57,9 million. Business
acquisitions and further investments in property, plant and equipment amounted
to R29,6 million.
The balance sheet remains healthy with working capital at satisfactory
levels. Intangible assets increased by R4,2 million as a result of
acquisitions. Net asset value per share increased by 15% to 337 cents.
Operational review
Some significant milestones were achieved during the year including the
celebration of Bearing Man`s 30th birthday in September 2004 and being
announced the winner of the FNB Sustainable Growth Award in the three year
listed company category.
The acquisition of Springset, a fastener business, in December 2004 assisted
the fasteners division to achieve good growth over the year. All divisions
performed satisfactorily.
Black economic empowerment
On 25 February 2005 the group withdrew the cautionary announcement relating to
the proposed investment by a BEE partner. The offer to minorities in Bearing
Man by Invicta Holdings Ltd(Invicta) will enable Invicta to empower the entire
group. Immediately all the formalities have been finalised in regard to the
Bearing Man minorities, priority will be given to speeding up the introduction
of BEE partners. A staff empowerment scheme will form part of this initiative,
and will be finalised as soon as possible.
Invicta offer to minorities and further cautionary announcement
The group issued a cautionary announcement on 13 April 2005 wherein shareholders
were advised of the intention of Invicta to make an offer to acquire all of the
issued shares of Bearing Man that they did not already own. Invicta currently
own 60,65% of Bearing Man. Invicta has irrevocable undertakings supporting the
transaction from more than 90% of the minority shareholders. A circular to
shareholders in this regard will be issued in early June. Shareholders are
advised to continue to exercise caution when dealing in the company`s securities
until a further announcement is made.
Accounting policies
The principal accounting policies, as outlined in the 2004 annual report, which
comply with South African Statements of Generally Accepted Accounting Practice
have been consistently applied except for the adoption of AC140 (Business
Combinations), AC128 (Impairment of Assets) and AC129 (Intangible Assets). The
group has prospectively applied the requirements of these revised statements to
business combinations with agreement dates on or after 1 April 2004 and to
goodwill in existence at 1 April 2004. As a consequence of this change in policy
goodwill in existence at 1 April 2004 is no longer amortised. The effect of this
change has resulted in an increase in profit before taxation and earnings for
the year of R465 000.
Audit opinion
Our auditors, PricewaterhouseCoopers Inc. have issued their opinion on the
group`s financial statements for the year ended 31 March 2005. A copy of their
unqualified report on these annual results is available for inspection at the
company`s registered office.
Prospects
While the South African economy is performing strongly, a significant segment of
the group`s customer base continues to find trading conditions difficult due to
the sustained strength of the Rand. With this in mind the group anticipates
real but modest growth in the coming year.
For and on behalf of the board
D I Samuels L J Marais
Chairman Managing Director 18 May 2005
Dividends
An interim dividend of 13 cents per share was declared during the period and
paid on 29 November 2004. The directors have, subsequent to the year end,
declared a further dividend (number 34) of 20 cents per share. The following
dates are applicable:
Last date to trade `cum` dividend Friday, 3 June 2005
Date trading commences `ex` dividend Monday 6 June 2005
Record date Friday, 10 June 2005
Date of payment Monday, 13 June 2005
Shareholders may not dematerialise or rematerialise their shares between
Monday, 6 June 2005 and Friday, 10 June 2005, both days inclusive.
By order of the board
DC Bassett
Company Secretary 18 May 2005
Registered office
Bearing Man Ltd, 6 Tetford Circle, Millennium Bridge Business Park,
La Lucia Ridge, 4320, South Africa
Auditors Sponsor
PriceWaterhouseCoopers Deloitte
Deloitte & Touche Sponsor Services (Pty) Ltd
(Incorporated in the Republic of South Africa)
(Registration number 1996/000034/07)
Transfer Secretaries
Computershare Investor Services 2004 (Pty) Limited, 70 Marshall Street,
Johannesburg, 2001
Directors
DI Samuels* (Chairman), LJ Marais (Managing), A Bekker (Alternate),
A Goldstone*, RE Sherrell*, WR Taylor, GJ Till (Non-executive*)
Company Secretary
DC Bassett
Results are available on: www.bearingman.co.za
Date: 18/05/2005 05:00:12 PM
Produced by the JSE SENS Department
