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Glenrand M.I.B - Trading Statement and restatement of prior year results in
terms of Circular 7/2005-Operating Leases
Glenrand M.I.B Limited
(Incorporated in the Republic of South Africa)
(Registration number 1997/008001/06)
Share Code: GMB ISIN: ZAE000018529
(`Glenrand M.I.B`) (`the Company`)
TRADING STATEMENT AND RESTATEMENT OF PRIOR YEAR RESULTS IN TERMS OF CIRCULAR
7/2005-OPERATING LEASES
In terms of the JSE Limited Listings Requirements, companies are required to
publish a trading statement as soon as they are reasonably certain that the
financial results for the current reporting period will be more than 20%
different than that of the previous corresponding period.
In our Trading Statement of 20 May 2005, we indicated that headline earnings per
share would decrease between 15% and 25% compared to the 32,0 cents reported in
the prior year, and that earnings per share will increase between 40% and 50%
compared to the prior year of 15,2 cents.
In accordance with the press release issued by The South African Institute of
Chartered Accountants on Friday, 29 July 2005 and Circular 7/2005 - Operating
Leases, the prior year results for the year ended 30 June 2004 have been
restated to headline earnings of R72,8 million, being 30,3 cents per share, and
earnings of R32,3 million, being 13,5 cents per share. The negative impact on
the results for the current year is R2,8 million (1,15 cents per share). The
negative effect of the lease accrual on opening retained income at 1 July 2003
is R10,2 million.
It has now become apparent that there has been a further unexpected
deterioration in the year-end results from our Benefit Services business as well
as further expenses that have now been recognised in the Risk Services business.
This in turn has triggered a reconsideration of the carrying values of
intangible assets which has resulted in significant impairments. We anticipate
that the headline earnings per share will decrease between 55% and 75% compared
to the restated 30,3 cents per share and earnings per share will decrease
between 60% and 80% compared to the restated 13,5 cents per share.
The poor operating results of Benefit Services are due mainly to a failure to
achieve business targets and shortcomings in the management and performance of
the Administration business. This has necessitated provisions for additional
expenses for the cost of rectification.
We confirm that following a detailed review of the Benefit Services operation we
continue to be fully committed to this business unit and will ensure quality
service delivery to our clients. The unit will continue to be subjected to
monthly operational and financial reviews to ensure that profitability is
restored and is sustainable.
Another high priority receiving urgent attention is the reorganisation of the
group structure in order to achieve better synergies
These forecast results for the year ended 30 June 2005 have not been reviewed or
reported on by the Company`s auditors. The Company`s results for the year ended
30 June 2005 are expected to be published on or about 7 September 2005.
Johannesburg
12 August 2005
Sponsor
Nedbank Capital
Date: 12/08/2005 02:41:12 PM
Produced by the JSE SENS Department
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