| Wed 24 Aug 2005, 9:00 | | ANNOUNCEMENT OF AUDITED RESULTS |
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Unitrans Limited
Registration number 1967/003403/06
JSE share code UTR
ISIN ZAE 000007670
("Unitrans" or "the company")
ANNOUNCEMENT OF AUDITED RESULTS
for the year ended 30 June 2005
FINANCIAL HIGHLIGHTS
Revenue up 19%
Headline earnings up 16%
Attributable earnings up 13%
Net asset value per share up 17%
THE BOARD OF DIRECTORS OF UNITRANS ANNOUNCES THE FOLLOWING AUDITED GROUP
RESULTS:
ABRIDGED GROUP INCOME STATEMENT
Audited
Restated
Year ended Year ended
30 June 30 June Increase
R000 2005 2004** %
Revenue 11 172 179 9 364 270 19
Operating income 412 544 400 718 3
Investment income 2 381 6 070
Net finance costs (41 050) (49 032)
Profit before taxation 373 875 357 756 5
Taxation (94 201) (98 668)
Profit after taxation 279 674 259 088
Share of associates' 285 (6 810)
profits/(losses)
Net profit for the year 279 959 252 278 11
Attributable to:
Unitrans Limited 275 660 243 428 13
shareholders
Minority interests 4 299 8 850
279 959 252 278 11
Weighted average number of 85 729 76 001
ordinary shares in issue
(000s)
Weighted average number of 789 876
ordinary shares that would
be issued on the
conversion of all the
dilutive potential
ordinary shares (000s)
Weighted average number of 86 518 76 877
shares for purposes of
calculating diluted
earnings per share (000s)
Earnings per share (cents)
- basic 321,5 320,3 0
- basic as previously 332,5
stated
- fully diluted 318,6 316,6
- fully diluted as 328,7
previously stated
Headline earnings per
share (cents)
- basic 343,7 334,5 3
- basic as previously 346,7
stated
- fully diluted 340,6 330,7
- fully diluted as 342,7
previously stated
Determination of headline
earnings
Net profit for the year 275 660 243 428
Adjustment for:
- closure costs 18 271 -
- loss/(profit) on
disposal of property,
plant
and equipment 6 012 (3 535)
- goodwill 498 13 559
impairment/amortisation
300 441 253 452
Taxation effect on (5 751) 792
profit/loss on disposal of
property, plant and
equipment and closure
costs
Headline earnings 294 690 254 244 16
Dividends per share - paid 100,0 93,0
* Prior year figures have been restated to reflect the restatement of foreign
operations into their functional currency, the proportionate consolidation of
the joint ventures and the change in the method of recognising operating lease
costs.
ABRIDGED GROUP BALANCE SHEET
Audited
Restated
30 June 30 June
R000 2005 2004**
Assets
Non-current assets 1 622 621 1 375 692
Property, plant and equipment 1 378 429 1 158 455
Goodwill 82 011 55 617
Investment in associate companies 43 202 40 922
Other non-current assets 85 206 84 196
Advances relating to the Unitrans - 9 275
Finance (Proprietary) Limited*
Deferred tax assets 33 773 27 227
Current assets 2 577 641 2 153 772
Inventories 901 718 731 748
Trade and other receivables 704 377 681 113
Advances relating to the Unitrans 9 275 73 357
Finance (Proprietary) Limited*
Cash and cash equivalents 962 271 667 554
Total assets 4 200 262 3 529 464
Equity and liabilities
Interest of shareholders of Unitrans 1 752 167 1 300 536
Limited
Share capital and share premium 701 784 423 554
Treasury stock (29 625) (12 734)
Reserves 1 080 008 889 716
Minority interests 42 686 42 529
Interest of all shareholders 1 794 853 1 343 065
Non-current liabilities 649 674 234 784
Interest-bearing borrowings 16 400 4 709
Domestic medium-term note 400 700 -
Non-current provisions 6 864 8 117
Deferred tax liabilities 120 209 154 676
Liabilities relating to the Unitrans - 9 275
Finance (Proprietary) Limited*
Non-interest-bearing long-term 105 249 54 775
liabilities
Vendors for businesses acquired 252 3 232
Current liabilities 1 755 735 1 951 615
Trade and other payables 873 294 799 117
Bank overdraft 457 627 442 789
Liabilities relating to the Unitrans 9 275 73 357
Finance (Proprietary) Limited*
Current provisions 127 452 117 338
Taxation 35 561 24 632
Vendors for businesses acquired - 6 000
Non-interest bearing short-term 196 240 117 362
liabilities
Short-term borrowings 56 286 371 021
Total equity and liabilities 4 200 262 3 529 464
Number of shares in issue adjusted 88 192 76 869
for treasury stock (000s)
Net asset value per share (cents) 1 987 1 692
* The liabilities of the Unitrans Finance (Proprietary) Limited ("Ufin") and the
assets pertaining thereto have been disclosed separately on the face of the
balance sheet.
** Prior year figures have been restated to reflect the restatement of foreign
operations into their functional currency, the proportionate consolidation of
joint ventures, the change in the method of recognising operating lease costs
the reclassification of the advances and liabilities of Unitrans Finance
(Proprietary) Limited and the separate disclosure of positive and negative bank
balances.
ABRIDGED GROUP CASH FLOW STATEMENT
Audited year ended
Restated
30 June 30 June
R000 2005 2004**
Cash generated from operations 667 770 615 395
Other non-cash movements 7 275 5 872
Investment income 2 381 6 070
Changes in working capital (32 129) (22 822)
- Inventories (169 423) (22 866)
- Trade and other receivables (10 358) (145 684)
- Trade and other payables 58 660 63 369
- Non-interest-bearing short-term 78 878 62 345
borrowings
- Current provisions 10 114 20 014
Net finance costs and taxation paid (161 456) (157 035)
Cash generated from operations 483 841 447 480
Dividends paid (82 136) (78 521)
Net cash generated from operations 401 705 368 959
Acquisition of subsidiaries (55 146) (8 052)
Acquisition of property, plant and
equipment
Replacement (219 537) (193 221)
Expansion (264 844) (289 069)
Proceeds from disposal of property, 67 224 65 753
plant and equipment
Acquisition of associates (88) -
Associate loan advanced (1 500) -
Foreign exchange movements (12 613) (9 892)
Decrease in non-current provisions (1 253) (1 589)
Decrease in other non-current assets 12 888 22 339
Net cash utilised in investing (474 869) (413 731)
activities
Net cash utilised by operations (73 164) (44 772)
Net proceeds from issue of shares 260 028 14 823
Net proceeds from issue of domestic 400 700 -
medium term note
Vendors for businesses repaid (7 957) (3 979)
Increase in loan from minorities - 3 576
Decrease in interest-bearing (3 225) (81)
borrowings
Increase in non-interest-bearing 18 232 -
borrowings
(Decrease)/increase in short-term (314 735) 67 179
borrowings
Net cash generated from financing 353 043 81 518
activities
Net increase in cash and cash 279 879 36 746
equivalents
Cash and cash equivalents at 224 765 188 019
beginning of the year
Cash and cash equivalents at end of 504 644 224 765
the year
** Prior year figures have been restated to reflect the restatement of foreign
operations into their functional currency, the proportionate consolidation of
joint ventures and the change in the method of recognising operating lease
costs.
ABRIDGED GROUP STATEMENT OF CHANGES IN EQUITY
Audited year ended
Restated
30 June 30 June
R000 2005 2004**
Opening balance as previously reported 1 343 065 1 206 095
Effect of the change in accounting - (31 751)
policy with regard to the translation
of foreign operations, the method by
which it accounts for joint ventures
and the restatement for the change in
the method of recognising operating
leases costs
Opening balance restated 1 343 065 1 174 344
Net profit for the year 279 959 252 278
Dividends paid (81 531) (78 040)
Dividends paid on "A" shares in a (605) (481)
subsidiary
Vesting of previously unvested shares 10 101 10 136
to participants in the share trust
representing treasury shares
Shares repurchased by subsidiary and (26 992) -
share trust
Net proceeds on issue of shares 287 020 7 727
(Loss)/profit on the sale of shares by (8 790) 7 096
the share trust
Release of non-distributable reserves - (192)
on sale of property
Statutory reserve in subsidiaries - (157)
Acquisition of additional interest in - (1 291)
existing subsidiary
Loan from minority shareholder - 3 576
Unrealised decrease on translation of (7 374) (31 931)
net worth of foreign subsidiaries
Closing balance 1 794 853 1 343 065
** Prior year figures have been restated to reflect the restatement of foreign
operations into their functional currency, the proportionate consolidation of
joint ventures and the change in the method of recognising operating lease
costs.
NOTES
1. Compliance with South African Statements of Generally Accepted Accounting
Practice (GAAP)
These results have been compiled in accordance with GAAP applicable to
preliminary financial reporting.
2. Accounting policies
The accounting policies used in the preparation of the results are consistent in
all material respects with those adopted in the annual financial statements for
the year ended 30 June 2004 except for the effects of the change in accounting
policy with regard to the translation of foreign operations, the method by which
it accounts for joint ventures, and the amortisation of goodwill.
For the details of the related adjustments, refer to notes 8 and 9 below.
In addition, certain comparative figures have been restated to comply with the
current year classifications. These reclassifications relate to Unitrans Finance
(Proprietary) Limited's advances and liabilities, and the group's positive and
negative bank balances, which have been separately disclosed on the balance
sheet.
Refer to note 9 for the impact of these adjustments.
3. Material subsequent events
No material events have occurred subsequent to the year-end.
4. Changes in the business
There were no material changes in the composition of the business during the
year.
5. Audit opinion
The auditors, Deloitte & Touche, have issued their opinion on the group's
financial statements for the year ended 30 June 2005. The audit was conducted in
accordance with South African Auditing Standards. They have issued an
unqualified audit opinion. A copy of their audit report is available for
inspection at the company's registered office. These summarised financial
statements have been derived from the group financial statements and are
consistent in all material respects, with the group financial statements.
6. Capital commitments
Capital expenditure commitments amounted to R39 million (2004: R56 million).
7. Litigation, claims and contingent liabilities
There were no material litigation, claims or contingent liabilities as at 30
June 2005 (2004: Nil).
8. Change in accounting policies
During the year the group changed its accounting policy with regard to the
translation of foreign operations, the method by which it accounts for joint
ventures and the amortisation of goodwill.
As a result of the introduction of the concept of functional currency in AC112
(IAS21) (The Effects of Changes in Foreign Exchange Rates), the statement no
longer draws a distinction between integral foreign operations and foreign
entities. Accordingly the results of operations previously classified as
integral foreign operations and translated to the presentation currency of the
holding company in terms of the previous AC112 have been restated in the
functional currency of the holding company.
Previously, the group accounted for joint venture operations using the equity
method. In order to comply with the policy adopted by its parent company,
Steinhoff International Holdings Limited, joint venture operations are now
accounted for using the proportionate consolidation method, in terms of the
preferred method of accounting in AC119 (IAS31) (Interests in Joint Ventures).
During the current year, the group adopted the revised AC140/IFRS3 (Business
Combinations) and is no longer amortising its goodwill. The goodwill is subject
to an annual impairment test. AC140 is only applicable prospectively and hence
the comparative information has not been restated.
As a result of the above accounting policy changes, the comparative information
has been restated. Refer to note 9 for details of the restatement.
9. Restatement of comparative information
The comparative information presented has been restated for the following:
- the restatement of foreign operations in the appropriate functional currency
- the change in treatment of the joint venture, which is now proportionately
consolidated, whereas in the prior year it was equity accounted
- the separate disclosure of positive and negative bank balances
- the reclassification of the assets and liabilities relating to Unitrans
Finance (Pty) Limited to show the gross advances and liabilities
- the change in the basis of recognising operating lease costs. The South
African Institute of Chartered Accountants issued Circular 7/2005: Operating
leases on 2 August 2005. The circular refers to the requirements of AC105:
Leases, in terms of which operating leases with fixed rental increases must be
accounted for on the straight-line basis. In South Africa, the accounting
treatment of such operating leases were generally not consistent with the
requirements of AC105. The impact of recognising operating lease costs on the
straight-line basis rather than the cash flow basis is set out below.
Effect on income statement
R000 2005 2004
Increase in revenue due to the 91 586 73 239
proportionate consolidation of the
joint venture
Increase in operating income before 6 147 1 648
depreciation for the restatement of
foreign operations in the functional
currency
Increase in depreciation for the (1 846) (890)
restatement of foreign operations in
the functional currency
Increase in operating income before 8 652 7 660
depreciation for the proportionate
consolidation of the joint venture
Increase in depreciation for the (3 387) (3 548)
proportionate consolidation of the
joint venture
Decrease in operating income before (9 943) (10 697)
depreciation for the change in
treatment of the operating leases
Decrease in associate earnings for the (672) (1 171)
change in treatment of the operating
leases
Decrease in associate earnings for the (6 271) (6 189)
proportionate consolidation of the
joint venture
Decrease in net finance costs for the (640) 325
proportionate consolidation of the
joint venture
Taxation effect 5 287 3 628
Decrease in net profit for the year (2 673) (9 234)
Decrease in opening retained earnings (31 751)
for 2004
Effect on balance sheet
R000 2005 2004
Increase in property, plant and 5 414 4 981
equipment for the restatement of
foreign operations in the functional
currency
Increase in property, plant and 2 112 14 777
equipment for the proportionate
consolidation of the joint venture
Increase in goodwill for the - 10 836
proportionate consolidation of the
joint venture
Decrease in associates for the - (28 869)
proportionate consolidation of the
joint venture
Decrease in associates for the change (2 086) (1 414)
in treatment of operating leases
Increase in deferred tax asset for the - 1 770
proportionate consolidation of the
joint venture
Increase in deferred tax asset for the 18 781 16 433
change in treatment of operating leases
Increase in other non-current assets - 999
for the proportionate consolidation of
the joint venture
Increase in inventories for the - 470
proportionate consolidation of the
joint venture
Increase in trade and other receivables 539 11 447
for the proportionate consolidation of
the joint venture
Increase in cash and bank balances for 594 5 768
the proportionate consolidation of the
joint venture
Increase in cash and bank balances, due 457 627 442 789
to the separate disclosure of positive
and negative bank balances
Increase in advances relating to - 82 632
Unitrans Finance (Proprietary) Limited
Effect on assets 482 981 562 619
Increase/(decrease) in non- 2 403 (1 024)
distributable reserves for the
restatement of foreign operations in
the functional currency
Increase in distributable reserves for 3 011 2 657
the restatement of foreign operations
in the functional currency
Increase/(decrease) in distributable 205 (3 896)
reserves for the proportionate
consolidation of the joint venture
Decrease in distributable reserves for (48 018) (39 749)
the change in treatment of operating
leases
Increase in deferred tax liability for 84 3 348
the restatement of foreign operations
in the functional currency
Increase in taxation for the - 20
proportionate consolidation of the
joint venture
Increase in trade and other payables 2 956 21 074
for the proportionate consolidation of
the joint venture
Increase in trade and other payables 64 713 54 768
for the change in treatment of
operating leases
Increase in bank overdraft due to 457 627 442 789
separate disclosure of positive and
negative bank balances
Increase in liabilities relating to - 82 632
Unitrans Finance (Proprietary) Limited
Effect on equity and liabilities 482 981 562 619
10. Segmental analysis
TRANSPORT AND LOGISTICS
Freight
and
2005 Logistics Passenger Total
INCOME STATEMENT*
Revenue 1 971 672 516 263 2 487 935
Operating income before 283 972 105 078 389 050
depreciation
Depreciation 187 734 44 305 232 039
Operating income after 96 238 60 773 157 011
depreciation
BALANCE SHEET
Total assets 2 206 521 371 975 2 578 496
Total liabilities 1 137 038 191 682 1 328 720
Net assets 1 069 483 180 293 1 249 776
GROSS CAPITAL 338 058 121 884 459 942
EXPENDITURE**
MOTOR AND FINANCIAL SERVICES
2005 Retail Financial Total
INCOME STATEMENT*
Revenue 8 589 493 94 751 8 684 244
Operating income before 227 327 44 885 272 210
depreciation
Depreciation 16 159 518 16 677
Operating income after 211 168 44 365 255 533
depreciation
BALANCE SHEET
Total assets 1 440 501 181 265 1 621 766
Total liabilities 991 903 84 786 1 076 689
Net assets 448 598 96 479 545 077
GROSS CAPITAL 24 272 167 24 439
EXPENDITURE**
GROUP
2005
INCOME STATEMENT*
Revenue 11 172 179
Operating income before 661 260
depreciation
Depreciation 248 716
Operating income after 412 544
depreciation
BALANCE SHEET
Total assets 4 200 262
Total liabilities 2 405 409
Net assets 1 794 853
GROSS CAPITAL 484 381
EXPENDITURE**
Revenue earned outside of South Africa (Mozambique, Malawi, Tanzania, Botswana,
Namibia, Lesotho and Swaziland) totalled R398 million (2004: R389 million).
This translated into operating income after depreciation of R85 million (2004:
R92 million).
The total net asset value attributable to these operations is R365 million
(2004: R326 million).
TRANSPORT AND LOGISTICS
Freight
and
2004 (Restated) Logistics Passenger Total
INCOME STATEMENT*
Revenue 1 836 497 372 620 2 209 117
Operating income before 322 405 84 311 406 716
depreciation
Depreciation 151 986 38 154 190 140
Operating income after 170 419 46 157 216 576
depreciation
BALANCE SHEET
Total assets 2 007 626 240 230 2 247 856
Total liabilities 1 360 379 50 288 1 410 667
Net assets 647 247 189 942 837 189
GROSS CAPITAL 406 181 54 582 460 763
EXPENDITURE**
MOTOR AND FINANCIAL SERVICES
2004 (Restated) Retail Financial Total
INCOME STATEMENT*
Revenue 7 049 823 105 330 7 155 153
Operating income before 160 853 37 801 198 654
depreciation
Depreciation 13 667 845 14 512
Operating income after 147 186 36 956 184 142
depreciation
BALANCE SHEET
Total assets 1 049 150 232 458 1 281 608
Total liabilities 625 568 150 164 775 732
Net assets 423 582 82 294 505 876
GROSS CAPITAL 21 380 147 21 527
EXPENDITURE**
GROUP
2004 (Restated)
INCOME STATEMENT*
Revenue 9 364 270
Operating income before 605 370
depreciation
Depreciation 204 652
Operating income after 400 718
depreciation
BALANCE SHEET
Total assets 3 529 464
Total liabilities 2 186 399
Net assets 1 343 065
GROSS CAPITAL 482 290
EXPENDITURE**
* The results of associates are not included in the segmental analysis other
than the cost of investment which is included in total assets.
** Gross capital expenditure is defined as capital expenditure incurred on
property, plant and equipment excluding any disposals.
RESULTS
Financial highlights
During the year under review the domestic economy was characterised by high
consumer spending on the back of low interest and inflation rates, good economic
growth and the strong Rand.
Against this background, the group achieved the following performance for 2005,
measured against the objectives set by it in the 2004 annual report.
Objectives for 2005 Performance in 2005
Revenue growth Revenue from the group's activities
grew by 19% to R11,2 billion (2004:
R9,4 billion)
Real headline Headline earnings grew by 16% to
earnings growth R294,7 million (2004: R254,2
million)
Maintain return on The group's return on shareholders'
shareholders' funds funds was stable despite the
additional 11,6 million shares
allotted and issued for the BEE
transaction referred to below
Bed down the NTI This acquisition has been
acquisition in successfully bedded down and has
Passenger contributed to Passenger's success
in the current year
Focus on management All of the group's divisions have
of costs placed additional focus on the
management of costs, which have
generally been contained at
acceptable levels
Seek opportunities The group has achieved substantial
for continued growth growth in its Motor and Passenger
in existing and new divisions. The Freight and Logistics
markets/products division has expanded its service
offerings and is focusing on the
provision of complete supply chain
solutions to its customers, both
existing and new. A number of
acquisition opportunities are under
review
Headline earnings per share increased by 3% to 343,7 cents (2004: 334,5 cents)
on the back of the allotment and issue of the additional 11,6 million shares for
purposes of the BEE transaction referred to below.
Headline earnings per share on a pro forma basis, excluding the net effect of
the new shares issued, would have increased by 9% to 365,9 cents per share.
The company repurchased 814 971 of its shares at a cost of R27 million. The full
benefit of these repurchases on headline earnings per share will be evident in
the next financial year.
Borrowings
The group elected to restructure its debt profile by introducing a level of
medium-term fixed rate funding. In May 2005, the group registered a R1,5 billion
Domestic Medium Term Note programme with the Bond Exchange of South Africa. To
date, R400 million of notes have been issued under this programme for a five-
year period.
At year-end, the group was in a net cash position of R31 million. Short-term
borrowings reduced to R56 million (2004: R371 million). The core level of net
borrowings decreased from R550 million to R520 million. Net finance costs
decreased from R49 million to R41 million.
The group's net asset value per share increased by 17% to 1 987 cents (2004: 1
692 cents) and tangible net asset value increased to 1 894 cents (2004: 1 620
cents).
Closure costs
Costs totalling R18,3 million before tax, directly attributable to the
termination of certain businesses, have been excluded from headline earnings.
These costs relate to businesses terminated during the year under review, which
were the harvesting operations within Forestry, the National Lubes Distribution
business and certain Express Distribution operations.
REVIEW OF OPERATIONS
Freight and Logistics
Revenue for the Freight and Logistics division grew by 7% to R1,97 billion
(2004: R1,84 billion) and operating income after depreciation decreased to R96
million (2004: R170 million). The decreased contribution from this division was
as a result of several factors, including the 10-day strike in the freight
industry and disappointing performances from certain of the division's
operations. The majority of the freight operations turned in solid performances.
Difficulties were experienced in the following areas:
* The Forestry operations made a loss for the year. Decisive remedial action has
been taken and the operations have been restructured. Only selected aspects of
the Forestry operations will be retained going forward, with the balance being
closed.
* The Express Delivery operations did not meet expectations. Certain operations
were closed and the balance are receiving management attention.
* The Fuel and Chemical cluster had a poor year as a result of the loss of
certain contracts and increased competition on international activities.
The balance of the Freight and Logistics' businesses including the Mining,
Industrial and Foods units, the Sugar and Agriculture cluster, Roadway Logistics
(Proprietary) Limited and Unitrans Supply Chain (Proprietary) Limited, performed
well. Unitrans Supply Chain (Proprietary) Limited had an extremely positive year
and was successful in securing a number of major contracts, including contracts
for steel warehousing and distribution of BP/Castrol lubricants.
Capital expenditure
Gross capital investment in Freight and Logistics was R338 million (2004: R406
million), R160 million of which was used to fund expansion, with the balance
spent on replacement.
Passenger
Revenue for this division grew by 39% to R516 million (2004: R373 million) and
operating income after depreciation increased by 32% to R61 million (2004: R46
million).
These excellent results were achieved in the face of intense competition on the
division's intercity operations and against reduced tourism numbers. The
division's successful entry into the commuter bus transport market in the
Rustenburg area, which is a divisional BEE initiative, has added to the
division's ability to balance its performance to withstand the indirect impact
of economic conditions such as the strength of the Rand, which has affected
tourism levels and certain of the division's customers in the mining sector.
Capital expenditure
Capital investment for the division was R122 million (2004: R55 million) of
which R97 million was used to fund expansion, mainly on the Rustenburg commuter
bus transport contact, with the balance spent on replacement.
Motor and Financial Services
Motor Retail
Revenue for the division increased by 22% to R8,6 billion (2004: R7,1 billion)
and operating income after depreciation increased by 45% to R213 million (2004:
R147 million).
The division, assisted by the positive conditions in the South African retail
market, produced excellent results and achieved record levels of new vehicle
sales. The parts and related after sales services operations also performed well
on the back of strong sales volumes. Sales of pre-owned vehicles were under
pressure as a result of new vehicle price stability. The market for pre-owned
vehicles has, however, begun to show signs of increased demand.
Insurance and Financial Services
The growth in operating income for these operations, fuelled by the increase in
vehicle sales, was 20% year-on-year.
Hertz
Management's focus on increased cost efficiencies, better fleet utilisation
levels and yield management has had a positive impact on this operation which
returned to profitability during the year, despite extremely competitive
industry pricing.
Capital expenditure
Gross capital expenditure for the Motor and Financial Services division was
contained to R24 million (2004 : R22 million).
CREDIT RATING
On 3 May 2005 Fitch granted the company a national rating of Long-Term "A (Zaf)"
with a stable outlook, and a Short-Term "F1 (Zaf)" rating. The Domestic Medium
Term Note programme referred to above was assigned a national Long-Term "A
(Zaf)" rating.
SHAREHOLDING STRUCTURE
With effect from 20 January 2005, Steinhoff International Holdings Limited
("Steinhoff") acquired the 34 216 680 shares in Unitrans held by Murray &
Roberts Holdings Limited ("M&R") ("the Steinhoff Acquisition"). In accordance
with the requirements of the Securities Regulation Panel code on takeovers and
mergers, Steinhoff was obliged to make an offer to the minority shareholders,
other than Fundiswa Investments (Proprietary) Limited (formerly Clidet No 518
(Pty) Limited) ("Fundiswa"), to acquire their shares for an offer consideration
of R26,32 per share, being the price at which Steinhoff had acquired Unitrans'
shares in terms of the Steinhoff Acquisition ("the Mandatory Offer"). The
Mandatory Offer, which was not recommended by the board, was made on 25 February
2005 and was accepted by shareholders holding only 1 050 Unitrans' shares.
The introduction of Steinhoff as the new controlling shareholder has been
welcomed by the board and by Unitrans' management and is seen as a positive move
that will generate benefits for all stakeholders going forward.
BEE TRANSACTION
The allotment and issue on 4 October 2004 at R25,04 per share of 11 600 000
shares to Fundiswa serves to underscore the group's commitment to black economic
empowerment, which it believes is a strategic imperative.
As previously advised, Fundiswa is owned as to 34,9% by each of Arch Equity
Limited, a black controlled company focusing on private equity investments, and
Mvelaphanda Capital (Proprietary) Limited, a wholly owned subsidiary within the
Mvelaphanda Group, a widely recognised
BEE entity. The remaining 30,2% is held by the Unitrans Limited Employee Trust,
which affords permanent employees in South Africa, other than executive
management, a long-term stake in the group. At least 86% of the beneficiaries
under this trust are previously disadvantaged individuals.
DIRECTORATE
The following changes in the directorate of the company took place:
Mr RH Naisby retired from the company and resigned as a director with effect
from 1 December 2004.
Messrs BC Bruce and RW Rees resigned as non-executive directors with effect from
20 January 2005, pursuant to Murray & Roberts' exit as the controlling
shareholder of the company.
Messrs D Lockey, the Chief Executive of Arch Equity Limited, Messrs KB Mosehla,
a director of Mvelaphanda Capital (Proprietary) Limited and JHN van der Merwe,
Chief Financial Officer of Steinhoff, were appointed to the board as non-
executive directors with effect from 6 May 2005. Messrs KB Mosehla and JHN van
der Merwe have also been appointed to the Audit and Risk Committee of the board.
CORPORATE ACTIVITY
An agreement has been entered into between Unitrans Motors (Proprietary) Limited
("Motors") and New Africa Investments Limited ("Nail") for the acquisition by
Motors of the remaining 60% shareholding held by Nail in Alisa Holdings
(Proprietary) Limited, trading as Hertz Rent A- Car ("Hertz"). The acquisition,
which will result in Motors holding 100% of Hertz, is subject to the approval of
the Competition Tribunal.
With effect from 30 June 2005, the company acquired the remaining 50%
shareholding held by Steinhoff in Roadway Logistics (Proprietary) Limited
("Roadway"), the joint venture company established with Steinhoff for the
provision of logistics services to the retail furniture and "white goods"
industries. This transaction did not constitute a related party transaction as
defined in section 10 of the Listings Requirements of the JSE Limited, as the
acquisition price as a percentage of the group's market capitalisation at the
date of acquisition fell below 0,25%.
SOCIAL RESPONSIBILITY
The group remains committed to conducting its business as a responsible
corporate citizen.
The group's HIV/Aids pilot programme has been rolled out with mixed success as
there is, unfortunately, still a stigma associated with this disease. Efforts
are ongoing to reassure employees and programme participants as to the
confidential nature of the testing services and treatment provided. The Freight
Industry National Bargaining Council has negotiated an agreement with all
stakeholders for the formalised provision of a full anti-retroviral treatment
programme. This programme has been invaluable in identifying the most effective
methods to secure employee participation and seeks to make treatment available
across the board.
The group's programme of pursuing both international and domestic accreditation
in the field of environmental, safety and health management is ongoing and the
group has been successful in receiving numerous accreditations in its fields of
operation.
PROSPECTS
The Freight and Logistics division is expected to benefit from the forecast
growth within the domestic economy. The steps taken in restructuring and
refocusing the Forestry operations have already begun to bear fruit and the
contribution from these operations should return to acceptable levels in the
year ahead. The new contracts secured by Unitrans Supply Chain (Proprietary)
Limited will serve to augment the Freight and Logistics division's service
offerings.
Notwithstanding the current decline in tourism levels and strong competition on
intercity services, the Passenger division's excellent performance this year
should continue for the year ahead. The low cost intercity service introduced by
the division, coupled with the contribution from the commuter bus operations,
should continue to counter any negative market aspects.
The confidence in the new vehicle market is expected to remain for the immediate
future and, provided interest rates remain stable and inflation is contained at
low levels, this should result in another good performance from the Motor and
Financial Services divisions.
The group remains committed to maximising organic growth and expanding its
service offerings and will continue to assess and evaluate local and foreign
acquisition opportunities that are in line with the group's strategy. Should an
appropriate opportunity be identified, the group has adequate financial
resources available.
The objectives set for 2006 are :
* Revenue growth
* Headline earnings growth
* Growth in the international component of the group's businesses
* Reposition Freight and Logistics as a supply chain service provider
* Expand in the commuter bus transport market
* Growth in the group's car rental operations
* Expand Motors' retail footprint.
* Increase return on shareholders' funds.
The board is of the view that the group is on track to meet its objectives and
should continue to deliver real growth in earnings in the year ahead.
For and on behalf of the board
DC Brink KJ Grove
Chairman Chief Executive
DISTRIBUTION OUT OF SHARE PREMIUM: CASH DISTRIBUTION NUMBER 1
Notice is hereby given that a cash distribution from share premium, in lieu of a
dividend, of 110 cents per share has been declared and is payable to
shareholders recorded in the books of the company at the close of business on
Friday, 14 October 2005. The distribution will be made in terms of the general
authority granted by shareholders at the annual general meeting held on 8
December 2004. The salient dates of this distribution are :
Last day to trade cum capital Friday, 7 October 2005
distribution
Shares commence trading ex capital Monday, 10 October 2005
distribution
Record date Friday, 14 October 2005
Payment date Monday, 17 October 2005
Share certificates may not be dematerialised/rematerialised between Monday, 10
October 2005, and Friday, 14 October 2005, both days inclusive.
On Monday, 17 October 2005, the capital distribution will be electronically
transferred to the bank accounts of certificated shareholders who utilise this
facility. For those who do not have bank accounts, cheques, dated 17 October
2005, will be posted on or about that date. Shareholders who have dematerialised
their shares will have their accounts credited on 17 October 2005.
In terms of the requirements of the Companies Act, the directors confirm that,
after the payment of this cash distribution, the company will be able to pay its
debts as they become due in the ordinary course of business and its consolidated
assets, fairly valued, will exceed its consolidated liabilities.
On behalf of the board
JV Radnay
Company Secretary
Illovo
23 August 2005
Directors: DC Brink*, PJ Dieperink, KJ Grove, MJ Jooste*, SM Keys, D Konar*, D
Lockey*, KB Mosehla*, PK Quarmby*, DM van der Merwe*, JHN van der Merwe* * non
executive
Secretary: JV Radnay
Registered office: 263 Oxford Road, Illovo, Johannesburg 2196, Telephone: 011
912 7000, Telefax: 011 442 7802/20
Transfer secretaries: Computershare Investor Services 2004 (Pty) Limited, Ground
Floor, 70 Marshall Street, Johannesburg 2001
Telephone: 011 370 7700, Telefax: 011 688 5200
www.unitrans.co.za
Unitrans Limited
Registration number 1967/003403/06
JSE share code UTR
ISIN ZAE 000007670
("Unitrans" or "the company")
Unitrans Motors Dealers
Algoa Toyota Group (4)*
Avondale Toyota
Buffalo Toyota Group (2)*
East Rand Toyota
Killarney Toyota Group (2)*
Limpopo Toyota Group (2)*
Market Toyota Group (5)*
Monument Toyota Group (3)*
Oranje Toyota Group (8)*
Pat Hinde Toyota Group (4)*
Rivonia Toyota
IC Group (3)* (Nissan/Fiat)
United Motors Group (2)* (DC)
United Truck Centre (MAN)
Williams Hunt GM Group (12)*
Port Elizabeth Chevrolet
Autobahn BMW
Northcliff Auto BMW
Audi Centre East Rand Mall
Benoni Citi VW
Kingspark VW Durban
Klerksdorp Volkswagen & Audi
Kroonstad Volkswagen
McDuling Motors VW
Strijdom Park VW
The Glen Volkswagen & Audi
* Denotes number of dealerships
Date: 24/08/2005 07:26:40 AM Produced by the JSE SENS Department
