| Thu 19 May 2005, 13:06 | | Results For The 6 Months Ended 31 January 2005 |
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Results For The 6 Months Ended 31 January 2005
PHUMELELA GAMING AND LEISURE LIMITED
(Registration number 1997/016610/06)
Share code: PHM
ISIN: ZAE000039269
The Group`s unaudited financial results for the 6 months ended 31 January
2005
* Revenue up 17%
* Dividend up 20
The Group`s unaudited financial results for the six months ended 31
January 2005 are as follows:
ABRIDGED CONSOLIDATED INCOME STATEMENTS
Unaudited Unaudited Audited
Six Six Twelve
months months months
31 Jan 2005 31 Jan 2004 31 Jul 2004
R`000 R`000 R`000
Revenue 956 601 816 273 1 736 895
Net betting income 205 871 177 262 376 177
Other operating income 59 671 48 814 97 630
Net income 265 542 226 076 473 807
Local operating expenses 165 177 157 044 309 026
Stakes 55 515 43 304 102 743
International expansion 15 253 - 5 404
Total operating expenses 235 945 200 348 417 173
Profit from operations 29 597 25 728 56 634
Finance costs 7 11 35
Profit before associated 29 590 25 717 56 599
company`s income
Share of associated company`s 151 - 305
income
Profit before taxation 29 741 25 717 56 904
Taxation 10 499 8 909 18 985
Earnings attributable to 19 242 16 808 37 919
ordinary shareholders
Adjusted for:
Loss/(surplus) on disposal of 45 (370) (452)
property, plant and equipment
Amortisation of goodwill - 536 1 072
Headline earnings 19 287 16 974 38 539
Number of ordinary shares in 71 017 285 70 000 285 70 649 985
issue
Weighted average number of 70 918 589 70 000 285 70 057 416
shares
Basic earnings per share (cents) 27,13 24,01 54,13
Diluted earnings per share 25,63 22,95 51,29
(cents)
Headline earnings per share 27,20 24,25 55,01
(cents)
Net asset value per share 199,28 174,25 193,10
(cents)
Dividend declared per share 12,00 10,00 30,00
(cents)
ABRIDGED CONSOLIDATED BALANCE SHEETS
Unaudited Unaudited Audited
31 Jan 2005 31 Jan 2004 31 Jul 2004
R`000 R`000 R`000
ASSETS
Non-current assets 163 098 154 414 158 692
Property, plant and equipment 151 369 143 602 145 921
Goodwill 3 126 3 662 3 126
Deferred taxation 100 1 214 100
Long-term debtor 2 640 5 686 3 905
Investment in associated 5 613 - 5 390
company
Investment 250 250 250
Current assets 61 287 42 338 70 804
Inventories 147 434 151
Trade and other receivables 24 140 16 541 24 499
Cash and cash equivalents 37 000 25 363 46 154
Total assets 224 385 196 752 229 496
EQUITY AND LIABILITIES
Capital and reserves 141 525 121 973 136 424
Share capital and premium 23 059 22 688 23 012
Accumulated profit 118 466 99 285 113 412
Non-current liabilities 26 176 27 853 27 376
Retirement benefit obligations 5 999 7 853 5 999
Long-term borrowings 20 046 20 000 21 246
Deferred taxation 131 - 131
Current liabilities 56 684 46 926 65 696
Trade and other payables 47 804 36 555 51 085
Provisions 1 224 3 131 1 224
Taxation 7 656 7 240 13 387
Total equity and liabilities 224 385 196 752 229 496
ABRIDGED CONSOLIDATED CASH FLOW STATEMENTS
Unaudited Unaudited Audited
Six Six Twelve
months months months
31 Jan 2005 31 Jan 2004 31 Jul 2004
R`000 R`000 R`000
Cash generated by operations 33 857 27 028 58 006
Movement in working capital (2 917) (10 324) (3 332)
Cash generated by operating 30 940 16 704 54 674
activities
Net interest, investment income, (28 581) (9 607) (19 189)
dividend paid and taxation
Net cash inflow from operating 2 359 7 097 35 485
activities
Net cash outflow from investing (11 625) (5 502) (17 846)
activities
Net cash inflow/(outflow) from 112 (816) 3 931
financing activities
Net movement in cash and cash (9 154) 779 21 570
equivalents
Cash and cash equivalents at 46 154 24 584 24 584
beginning of period
Cash and cash equivalents at end 37 000 25 363 46 154
of period
ABRIDGED STATEMENT OF CHANGES IN GROUP EQUITY
Unaudited Unaudited Audited
Six Six Twelve
months months months
31 Jan 2005 31 Jan 2004 31 Jul 2004
R`000 R`000 R`000
Shareholders` interest at 136 424 113 915 113 931
beginning of period
Issue of share capital 47 - 324
Net profit for period 19 242 16 808 37 919
Dividend paid (14 188) (8 750) (15 750)
Shareholders` interest at end of 141 525 121 973 136 424
period
COMMENTS
REVIEW OF RESULTS
Revenue for the 6 months was 17% up on the comparative period, which
included the effects of the equine flu incident. The revenue growth
flowed through to net betting income, which was 16% up.
The increase in other operating income reflects the initial benefits of
the overseas developments, which are only now gathering momentum
following the recent resolution of the Racing UK data licence issue with
the previous broadcaster around which a settlement agreement is being
finalised.
Local operating expenses were generally held to inflationary increases
except for stakes, which increased by R12,2 million (28% increase)
following an uninterrupted racing programme.
International expansion expenditure was R15,3 million. The delayed income
flow due to the Racing UK licence dispute has resulted in a before tax
loss on these overseas initiatives of R6,5 million for the 6 months.
Headline earnings were 14% higher after a full tax provision and R1,8
million STC on the final dividend paid while HEPS increased by 12%.
FINANCIAL POSITION
Cash generated by operations during the 6 months of R33,9 million funded
the increase in working capital, the payment of the final dividend with
STC thereon and the taxation payments. Capital expenditure of R11,4
million and investments of R0,2 million contributed to the R9,2 million
decrease in cash and cash equivalents. Capital commitments approved by
the directors and contracted for at 31 January 2005 were R2,6 million,
and not contracted for were R12,9 million.
SEGMENTAL ANALYSIS
The Group currently operates in the business segment of horse racing and
betting, and mostly in one significant geographic segment, South Africa.
ACCOUNTING POLICIES
The interim financial statements have been prepared in accordance with
South African Statements of Generally Accepted Accounting Practice AC 127
and the listing requirements of the JSE Securities Exchange South Africa.
The accounting policies used in preparing the interim financial
statements are consistent with those used in the annual financial
statements for the year ended 31 July 2004.
EMPOWERMENT
Phumelela`s empowerment credentials were recognised with the overall
second place achievement in the annual Financial Mail Top Empowerment
Companies awards and leader in the leisure and hotels category.
LITIGATION
The Supreme Court of Appeal on the matter of bookmakers taking bets that
are linked to tote dividends was heard on 10 March 2005 and judgement has
been reserved.
The court date for the hearing of the equine flu insurance claim, lodged
early last year, has been set down for 3 November 2005 and the outcome
will be accounted for thereafter.
PROSPECTS
The positive trend in betting turnover, which has continued through
February and is supported by a strong local economy, together with the
expanded retail network with their ongoing upgrade programme, the
overseas developments which are expected to be profitable for the second
half, plus growth in fixed odds, are expected to yield an improved profit
performance in the second half.
DIVIDEND
Notice is hereby given that the Board has declared an interim dividend of
12 cents per share payable to shareholders recorded in the register on
Friday 22 April 2005. Shareholders are advised that the last date to
trade `cum dividend` will be Friday 15 April 2005. As from commencement
of business on Monday 18 April 2005 all trading of Phumelela shares will
be `ex dividend`. Payment will be made on Monday 25 April 2005. Share
certificates may not be dematerialised or rematerialised between Monday
18 April 2005 and Friday 22 April 2005, both days inclusive.
For and on behalf of the Board
M P MALUNGANI B D MEHL
Chairman Chief Executive
Johannesburg
16 March 2005
Directors: M P Malungani (Chairman), B D Mehl* (Chief Executive),
S E Abrahams, K J Hlongwane, B Kantor, S Khampepe, N J Mboweni,
J S Tennant* (Finance), J B Walters
(*Executive)
Company Secretary: A F Wintour
Registered Office: Turffontein Racecourse, 14 Turf Club Street,
Turffontein
Transfer Secretaries: Computershare Investor Services 2004 (Pty) Ltd
Share code: PHM ISIN: ZAE000039269
Sponsor: Investec Bank Limited
Web site: www.phumelela.com
Date: 16/03/2005 04:23:06 PM Produced by the JSE SENS Department
