| Thu 18 Aug 2005, 17:16 | | Results For The Half Year Ended 30 June 2005 |
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Pasdec - Unaudited Group Interim Results For The Half Year Ended 30 June 2005
Pasdec Resources SA Limited
Incorporated in the Republic of South Africa
Registration number 1987/004942/06
Share code: PSC
ISIN code: ZAE000023552
(`Pasdec` or `the company`)
CONDENSED GROUP INCOME STATEMENT
for the six months ended 30 June 2005
Unaudited
Unaudited IFRS Audited
IFRS Restated IFRS
half year half year restated
ended ended Year ended
30 June 30 June 31 December
2005 2004 2004
Note R`000 R`000 R`000
Revenue 118,355 111,182 228,309
Operating (loss)/profit before (1,803) 9,485 (5,717)
abnormal items
Abnormal items 1 (3,835) - (55,334)
Net (loss)/profit before interest (5,638) 9,485 (61,051)
and taxation
Finance charges 2 (5,376) (3,024) (10,706)
Net (loss)/profit before taxation (11,014) 6,461 (71,757)
Taxation charge (3,294) (1,769) (3,495)
(Loss)/profit for the period (14,308) 4,692 (75,252)
RECONCILIATION OF (LOSS)/EARNINGS AND HEADLINE EARNINGS
(Loss)/profit attributable to (14,308) 4,692 (75,252)
ordinary shareholders
Surplus on disposal of property - - (648)
and closure of foreign subsidiary
Headline (loss)/earnings (14,308) 4,692 (75,900)
attributable to ordinary
shareholders
(Loss) /earnings per share (25.6) 8.4 (134.5)
(cents)
Headline (loss)/earnings per (25.6) 8.4 (135.6)
share (cents)
Dividend per share (cents) - 2.5 2.5
Weighted number of shares in 55,964 55,964 55,964
issue (`000)
Note 1 - Abnormal items
Write down of inventories to net - - 46,834
realisable value
Retrenchments - - 3,307
Provision for disputed indirect - - 3,160
taxes
Legal costs and write down on 3,835 - 2,681
claims being pursued
Surplus on disposal of property - - (648)
and closure of foreign subsidiary
3,835 - 55,334
Note 2 - Finance charges
Included in finance charges is an accrued charge for interest on the majority
shareholders subordinated loan account amounting to R2 278 218 (Year end 2004 -
R4 559 645). The interest charge at a rate of 7.5% per annum has been accrued
subject to Exchange Control approval.
SEGMENTAL ANALYSIS
for the six months ended 30 June 2005
Unaudited
Unaudited IFRS Audited
IFRS Restated IFRS
half year half year restated
ended ended Year ended
30 June 30 June 31 December
2005 2004 2004
R`000 R`000 R`000
Revenue
Automotive 67,038 56,316 118,128
Electrical motors 51,317 54,866 110,181
Corporate - - -
118,355 111,182 228,309
Operating (loss)/profit before abnormal
items
Automotive 11,050 10,816 20,227
Electrical motors (12,335) (1,478) (23,253)
Corporate (518) 147 (2,691)
(1,803) 9,485 (5,717)
Net (loss)/profit before interest and
taxation
Automotive 7,215 10,816 18,069
Electrical motors (12,335) (1,478) (76,553)
Corporate (518) 147 (2,567)
(5,638) 9,485 (61,051)
CONDENSED GROUP BALANCE SHEET
as at 30 June 2005
Unaudited
Unaudited IFRS Audited
IFRS Restated IFRS
half year half year restated
ended ended Year ended
30 June 30 June 31 December
2005 2004 2004
R`000 R`000 R`000
ASSETS
Non-current assets
Property, plant and equipment 37,878 29,107 29,434
Intangibles 5,532 5,532 5,532
Deferred taxation 34,470 39,960 37,764
77,880 74,599 72,730
Current assets
Inventories 72,187 120,884 68,504
Trade and other receivables 29,897 47,567 27,156
Cash and cash equivalents 27 13 681
102,111 168,464 96,341
Total assets 179,991 243,063 169,071
EQUITY AND LIABILITIES
Capital and reserves
Share capital 37,642 37,642 37,642
Share premium 80,982 80,982 80,982
Accumulated loss (120,221) (25,972) (105,913)
Non-distributable reserve 9,593 9,267 9,593
7,996 101,919 22,304
Shareholders` loans 71,508 64,505 68,815
Total shareholders` funds 79,504 166,424 91,119
Long-term interest bearing debt 12,180 6,098 5,450
Current liabilities
Trade and other payables 55,360 44,976 52,693
Current portion of long-term interest 3,220 339 2,115
bearing debt
Bank borrowings 29,727 25,226 17,694
88,307 70,541 72,502
Total equity and liabilities 179,991 243,063 169,071
CONDENSED GROUP CASH FLOW STATEMENT
for the six months ended 30 June 2005
Unaudited Unaudited Audited
IFRS
IFRS Restated IFRS
half year half year restated
ended ended year ended
30 June 30 June 31 December
2005 2004 2004
R`000 R`000 R`000
Cash flows from operating activities
Cash (utilised)/generated by operations (1,002) 10,415 (5,735)
Changes in working capital (6,597) (6,573) 23,845
Finance charges (5,376) (3,024) (10,706)
Dividend paid - - (1,397)
Taxation paid - - (175)
Net cash (utilised)/generated by (12,975) 818 5,832
operating activities
Cash flows from investing activities (10,241) (4,185) (6,437)
Cash flows from financing activities 10,529 736 6,174
Net (decrease)/increase in cash and (12,687) (2,631) 5,569
cash equivalents
Beginning of period cash and cash (17,013) (22,582) (22,582)
equivalents
End of period cash and cash equivalents (29,700) (25,213) (17,013)
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
Non- Accumu-
Share Share distributable lated
capital premium reserves loss Total
R`000 R`000 R`000 R`000 R`000
Half-year ended 30 June
2005
At 1 January 2005- 37,642 80,982 9,593 (105,913) 22,304
audited IFRS restated
Net loss for the year (14,308) (14,308)
At 30 June 2005- 37,642 80,982 9,593 (120,221) 7,996
unaudited IFRS
Half-year ended 30 June
2004
At 1 January 2004- 37,642 80,982 9,092 (29,264) 98,452
audited IFRS restated
Movement in foreign 175 175
currency translation
reserve
Net profit for the year 4,692 4,692
Dividend declared (1,400) (1,400)
At 30 June 2004- 37,642 80,982 9,267 (25,972) 101,919
unaudited IFRS
Year ended 31 December
2004
At 1 January 2004- 37,642 80,982 9,092 (29,264) 98,452
audited IFRS restated
Movement in foreign 501 501
currency translation
reserve
Net profit for the year (75,252) (75,252)
Dividend declared (1,397) (1,397)
At 31 December 2004- 37,642 80,982 9,593 (105,913) 22,304
audited IFRS
COMMENTS ON THE UNAUDITED GROUP INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE
2005
The Group turnover for the six months ended 30 June 2005 amounted to R118,4
million, compared with R111,2 million for the corresponding period of the
previous year, representing an increase of some 6.4%. The increase in turnover
is attributable to Pasdec Automotive Technologies (Pty) Ltd. benefiting from the
increased sales experienced in the automotive industry.
The operating loss before abnormal items of the group for the six months ended
30 June 2005 is R1,8 million compared with R9,5 million profit for the
corresponding period of the previous year. After allowing for finance costs, the
group net loss before abnormal items for the six months ended 30 June 2005,
amounted to R7,2 million (2004: R6,5 million profit).
SUPPLEMENTARY NOTES TO THE CONSOLIDATED INTERIM FINANCIAL STATEMENTS
BASIS OF PREPARATION
The Group has elected to adopt IFRS for the year ending 31 December 2005. The
interim results have been prepared and presented in accordance with IAS 34 -
Interim financial reporting.
The financial statements for the year ending 31 December 2005 will be the
Group`s first consolidated IFRS-compliant financial statements and hence IFRS 1
- First time adoption of IFRS has been applied in preparing this interim report.
The effect of the transition to IFRS has resulted in a change in the value of
goodwill as a result of a write back of the amortisation charge amounting to
R343 000 for the year ended 31 December 2004 and R171 000 for the six months
ended 30 June 2004.
As a result of the transition to IFRS, the group has changed its accounting
policy relating to goodwill as follows:
Goodwill
All business combinations are accounted for by applying the `purchase method`.
Goodwill represents amounts arising on acquisition of subsidiaries, associates
and joint ventures. In respect of business combinations that have occurred since
the IFRS transition date, 1 January 2004, goodwill represents the difference
between the cost of the acquisition and the fair value of the net identifiable
assets and contingent liabilities acquired.
The Group made an election in terms of IFRS 1 that in respect of acquisitions
prior to this date, goodwill is included on the basis of its deemed cost, which
represents the amount recorded under SA GAAP. The classification and accounting
treatment of business combinations that occurred prior to 1 July 2003 has not
been reconsidered in preparing the Group`s opening IFRS balance sheet at 1
January 2004.
Goodwill is stated at cost less accumulated impairment losses. Goodwill is
allocated to cash-generating units and is no longer amortised but tested
annually for impairment. Negative goodwill arising on an acquisition is
recognised directly in the income statement.
Previously goodwill arising on each acquisition was amortised over its estimated
useful life on a straight line basis and subjected to annual impairment testing.
BUSINESS ACTIVITIES
The Group`s core business activities are the manufacture of electric wiring
harness for the automotive industry and the manufacture and distribution of
consumer and industrial electrical motors, flameproof electrical motors for the
mining industry, the distribution in the sub-Saharan region of the full range of
General Electric motors.
The strong rand continued to remain a challenge for trading conditions during
the first half of the year, within the electrical motor businesses. These
businesses would be restructured during the second half of the year to apply a
`Three tier approach` of stopping the losses, consolidation and achieving
profitability within the next eighteen months. The outlook for the electrical
motor business remains positive for regaining market share and volume
improvements post restructuring.
The electrical wiring harness business continues to grow from strength to
strength within the Automotive sector. The company has successfully completed a
twelve month capital equipment and plant expansion programme totalling R13,5
million. The board is currently reviewing the second phase of capital
expenditure which will commence during October 2005. Taking into account the
exceptional record growth in sales South Africa has experienced in the new motor
vehicle market over the last eighteen months, the company continues to benefit
from the positive sentiments within this sector and the export initiatives of
the local car manufacturers.
Pasdec Resources SA Limited is confident of the continued growth and
profitability in the electrical harness company during 2005 and beyond. The
electrical motor businesses will be restructured during the remainder period of
2005, to restore operational profitability following the implementation of the
strategies.
DIRECTORATE
Mr. Paul Arno Becker, who has served as Deputy Executive Chairman since 1 July
1999, resigned on 13 July 2005.
The current directors of Pasdec Resources SA Limited are:
Non-Executive:
Dato` Hamdan Bin Jaafar (chairman)*
Majid Mohamad*
Goh Song Han*
Executive:
Kevin Pather (Acting Chief Executive Officer)
*Malaysian
Registered Office: Transfer Secretaries:
33 Piet Pretorius Street Computershare Investor
Brits 0250 Services 2004 (Pty) Ltd
(P.O. Box 1575 Ground Floor, 70 Marshall Street
Brits 0250) Johannesburg 2001 (P.O. Box 61051
Marshalltown 2107)
Brits
18 August 2005
Sponsor KPMG Services (Pty) Ltd
Date: 18/08/2005 05:15:13 PM
Produced by the JSE SENS Department
