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Scharrig Mining Limited - Audited results for the year ended 31 March 2005
Scharrig Mining Limited
(Incorporated in the Republic of South Africa)
(Registration number 1992/01973/06)
Share Code: SCN ISIN Code: ZAE000006474
(`Schamin` or `the Company`)
Audited results for the year ended 31 March 2005
Headline earnings per share up 101%
Dividend up by 67%
Cash generated from operations of R219.5 million
Strong order book for 2006 financial year
Abridged consolidated balance sheet as at 31 March 2005
Audited at Audited at
31 March 2005 31 March 2004
R000 R000
Assets
Non-current assets
Property plant and equipment 610 362 450 175
610 362 450 175
Current assets
Inventories 9 887 6 614
Trade and other receivables 57 186 72 163
Bank balance and cash 28 887 16 922
95 960 95 699
TOTAL ASSETS 706 322 545 874
EQUITY AND LIABILITIES
Share capital and premium 92 378 84 657
Reserves 158 713 108 411
Ordinary shareholders funds 251 091 193 068
Non-current liabilities
Long-term borrowings 146 326 110 048
Deferred taxation 86 498 59 276
232 824 169 324
Current liabilities
Trade and other payables 53 673 57 792
Current portion of long-term
borrowings 168 259 125 161
Taxation 475 529
222 407 183 482
Total equity and liabilities 706 322 545 874
Net asset value per share (cents) 183 151
Abridged consolidated cash flow statement for the twelve months ended 31 March
2005
Audited Audited
year ended year ended
31 March 31 March
2005 2004
R000 R000
Cash generated from operations 219 458 160 986
Interest paid (33 472) (24 876)
Interest received 793 1 626
Dividends paid (7 502) (4 808)
Taxation paid (54)
Cash flows from operating activities 179 223 132 928
Cash flows from investing activities (254 355) (184 407)
Cash flows from financing activities 87 097 68 001
Net increase in cash and cash
equivalents 11 965 16 522
Cash and equivalents at the
beginning of year 16 922 400
Cash and equivalents at
the end of year 28 887 16 922
Segmental Analysis
for the twelve months ended 31 March 2005
2005 2004
Turnover Net profit Turnover Net profit
before before
taxation taxation
R000 R000 R000 R000
Coal Mining 550 993 89 434 544 530 41 436
Diamond Mining (675)
Second hand
equipment trading
and services 16 578 (3 763) 4 768 (4 304)
Abridged Consolidated Income Statement
for the twelve months ended 31 March 2005
Audited Audited
year ended year ended
31 March 31 March
2005 2004
R000 R000
Revenue 567 571 549 298
Operating profit before
finance charges 119 143 61 333
Finance charges 33 472 24 876
Net profit before taxation 85 671 36 457
Taxation 27 867 8 091
Net profit after taxation 57 804 28 366
Attritutable earnings
per share (cents) 46.6 23.2
Headline earnings per share
(cents) 46.6 23.2
Dividend per share (cents)
interim (declared) 3.50 2.00
final (proposed) 4.00 2.50
Total 7.50 4.50
Number of shares in issue
at end of period (000) 137 431 128 225
weighted average for the year
(000) 124 141 122 026
Statement of Changes in Equity
for the twelve months ended 31 March 2005
Accumu- Non-distri
Share Share Treasury lated butable
Capital Premuim share trust Profit Reserve Total
R000 R000 R000 R000 R000 R000
Balance at
31 March 2003 1 269 87 300 (1 166) 69 098 15 755 172 256
Share buyback (42) (2 920) (2 962)
Profit for the
year ended
31 March 2004 28 366 28 366
Dividend paid 83 (4 808) (4 725)
Share options
exercised 133 133
Balance at
31 March 2004 1 227 84 380 (950) 92 656 15 755 193 068
Shares issued 92 15 675 (9 520) 6 247
Profit for the
year ended
31 March 2005 57 804 57 804
Share options
exercised 1 417 1 417
Dividend paid 57 (7 502) (7 445)
Balance at
31 March 2005 1 319 100 055 (8 996) 142 958 15 755 251 091
COMMENTS
Nature of operations
Schamin is listed on the `Other Mineral Extractors and Mines` sector of the main
board of the JSE Securities Exchange South Africa (JSE). Schamin was established
in 1972 and was listed on the JSE in 1993. Schamin is one of the major providers
of opencast mining and mine rehabilitation services to the South African coal
mining industry. Schamin`s client base includes a number of blue chip
international and local mining companies.
Results
Turnover increased by 3.3% over the corresponding period in 2004 to R567.5
million. In May 2004 the method of invoicing customers changed from a `wet-
rate`, which includes the cost of diesel to a `dry-rate`, which excludes the
cost of diesel. On a like-for-like basis, turnover increased by 23% over the
2004 financial year aided by strong underlying demand for the group`s services
from the South African coal mining industry. The group`s operating profit margin
increased to 20.9% from 11.1% in the prior year (12.9% in the prior year on a
`dry-rate` basis).
Headline earnings per share of 46.6 cents were 101% higher than in 2004. A final
dividend of 4 cents per share has been declared (2.5 cents in 2004) to bring the
total dividends for the year to 7.5 cents (4.5 cents in 2004), which represents
an increase of 66.6% over the prior year.
Cash generated from operations for the year was R219.5 million (2004: R161.0
million) which equates to 176.8 cents per share (2004:131.9 cents per share).
Despite strong operating cash flow generation, Schamin`s debt to equity ratio
increased marginally to 114% from 113% in 2004 due to significant capital
expenditure on maintaining and expanding the group`s fleet. Schamin`s fleet
replacement program is now substantially complete and consequently the debt to
equity ratio should improve during the 2006 financial year.
Capital expenditure
The net investment during the year on capital expenditure was R254.4 million
(2004: R184.4 million). Of this, R100.4 million was maintenance in nature while
the balance of R153.7 million was invested in expanding and improving the
production capacity of the fleet. Capital expenditure for the 2006 financial
year is budgeted at R75 million. However, should new projects be secured,
capital expenditure in excess of this amount may be incurred.
Black economic empowerment
Shareholders are referred to the announcement published by Schamin on the 22
April 2005 relating to a black economic empowerment (BEE) transaction in terms
of which a BEE consortium acquired an interest in Schamin.
Prospects
Schamin will continue to look at new projects that add value to the current
operations.
Based on the current order book and the existing fleet of plant and equipment,
management is targeting an increase in turnover during the 2006 financial year
with improved operating efficiencies. Accordingly, improved operating results
should be achieved in the 2006 financial year.
Dividend
A final dividend of 4.0 cents per share has been declared subsequent to year end
and will be payable on the pay date being 25 July 2005 to shareholders recorded
in the register as such at the close of business on Friday, 22 July 2005 being
the record date in order to participate in such dividend.
The last day to trade cum-dividend is Friday, 15 July 2005.
The share will trade ex-dividend from Monday, 18 July 2005.
Share certificates may not be rematerialised or dematerialised from Monday, 18
July 2005 to Friday, 22 July 2005 both days inclusive.
Accounting policies
These financial results are prepared in accordance with South African Statements
of Generally Accepted Accounting Practice. The Accounting Policies are
consistent with those applied in the preparation of the audited financial
results for the 2004 financial year.
Audit opinion
The group`s Auditors, BDO Spencer Steward have issued their audit opinion on the
Group`s financial statements for the year ended 31 March 2005. A copy of their
unqualified report is available for inspection at the company`s registered
office.
On behalf of the board
C Scharrighuisen
Managing Director
J Holland
Financial Director
Boksburg
27 June 2005
Date: 27/06/2005 12:15:24 PM
Produced by the JSE SENS Department
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