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NAIL - Condensed consolidated financial results of the group for the six months
ended 30 June 2005
New Africa Investments Limited
(Incorporated in the Republic of South Africa)
(Registration number 1993/002467/06)
(Share codes: NAI and NAN)
(ISIN: ZAE000033338 and ZAE000033346)
("NAIL" or "the Group" or "the company")
CONDENSED CONSOLIDATED FINANCIAL RESULTS OF THE GROUP FOR THE SIX MONTHS ENDED
30 JUNE 2005
Consolidated income statement
Unaudited Unaudited
six months six months
30-Jun-05 30-Jun-04
R000 R000
Revenues 87 537 269 459
Operating (loss)/profit before
the following items: (2 643) 18 464
Amortisation and depreciation (992) (8 274)
Net (loss)/profit on sale of
subsidiaries and investments (32) 4 352
Fair value gains and losses - 47 276
Net write downs of investments and loans (1 247) -
Provision against Hertz and
Wild Coast Films assets 3 003 -
Operating (loss)/profit (1 911) 61 818
Finance income 3 100 17 844
Income from associates 473 6 925
Profit before taxation 1 662 86 587
Taxation (247) 19 101
Profit after taxation 1 909 67 486
Attributable to:
Minority interest 1 402 5 581
Group equityholders 507 61 905
1 909 67 486
HEADLINE (LOSS)/EARNINGS
Profit attributable to ordinary shareholders 507 61 905
Profit on sale of subsidiaries and associates 32 (4 352)
Provision (reversed)/raised against
Hertz and Wild Coast Films assets (3 003) -
(Profit)/loss on sale of fixed assets (25) -
Minority portion and tax effect 1 201 -
(1 288) 57 553
Headline (loss)/earnings per share (cents) (1,0) 45,4
Earnings per share (cents) 0,4 48,8
No of shares taken into account
in calculating EPS (000) 126 760 126 760
Segmental analysis of headline earnings
Six months Six months
30-Jun-05 30-Jun-04
R000 R000
Media
Publishing - 3 399
Radio 473 16 536
Film and Tv - 1 080
Outdoor - (1 103)
Total Media 473 19 912
Other
Hertz 303 (2 705)
African Bank Debtors Book (1 247) -
Head Office (817) 40 346
Total Group (1 288) 57 553
NET (LOSS)/PROFIT ON SALE OF
SUBSIDAIRIES AND INVESTMENTS
Radmark - 10 705
Kaya SPV"s (32) -
New Africa Books - (5 041)
Urban Brew - (1 312)
(32) 4 352
FAIR VALUE GAINS AND LOSSES
Provision for write up/(down) Johnnic/MTN - 17 938
Provision for write up Metropolitan - 22 950
Write up of interest in Kaya SPV"s - 6 388
- 47 276
NET WRITE DOWNS OF INVESTMENTS
AND LOANS
Provision for write down African Bank
Debtor"s Book (1 247) -
(1 247) -
Consolidated balance sheet
Unaudited Unaudited
30-Jun-05 30-Jun-04
R000 R000
ASSETS
Property, plant and equipment 4 714 67 552
Intangible assets - 151 664
Investments 13 060 97 811
Other non-current assets 247 19 109
Current assets 66 798 139 869
Cash and cash equivalents 136 959 186 566
Total assets 221 778 662 571
EQUITY AND LIABILITIES
Share capital and premium 4 814 4 814
Reserves 185 108 542 572
Minority interest (4 376) 29 316
Total equity 185 546 576 702
Non-current liabilities 9 172 18 380
Current liabilities 27 059 66 115
Bank overdraft 1 1 374
Total equity and liabilities 221 778 662 571
Net asset value per share (cents) 150 432
No of shares in issue at end of period 126 760 126 760
Consolidated cash flow
Consolidated cash flow
Cash (utilised)/retained from
operating activities (18 229) 5 607
Cash effects of investing activities 22 612 354 760
Cash effects of financing activities - (884 096)
Foreign currency translation - 2 133
Net increase/(decrease) in cash
and cash equivalents 4 383 (521 596)
Cash and cash equivalents
at beginning of the period 132 575 706 788
Cash and cash equivalents
at end of the period 136 958 185 192
Statement of changes in equity
Share capital Minority
and premium Reserves interest Total
R000 R000 R000 R000
Balance at
31 December 2003 874 389 753 320 40 662 1 668 371
Adjustment for
operating leases (1 433) (955) (2 388)
Restated opening
balance
at 1 January 2004 874 389 751 887 39 707 1 665 983
Net income for the
period 103 504 (3 202) 100 302
Foreign currency
transalation
reserve (1 259) (1 259)
Land and building
revaluation
reserve (685) (685)
Dividends paid (668 846) (23 153) (691 999)
Capital reduction (869 575) (869 575)
Sale of subsidiaries (19 130) (19 130)
Balance at
31 December 2004 4 814 184 601 (5 778) 183 637
Net profit for the
period 507 1 402 1 909
Balance at
30 June 2005 4 814 185 108 (4 376) 185 546
COMMENTARY
DIRECTORS" STATEMENT
Your directors take pleasure in presenting the unaudited interim results of the
Group for the six months ended 30 June 2005.
INTERNATIONAL FINANCIAL REPORTING STANDARDS (`IFRS") REPORTING
This report has been prepared in accordance with the Group"s accounting
policies, which fully comply with IFRS. The accounting policies were changed
with effect from 1 January 2005 to comply with IFRS. The transition to IFRS is
accounted for in accordance with IFRS 1 (First-time Adoption of International
Reporting Standards), with 1 January 2004 as the date of transition.
Comparative numbers have, accordingly, been restated.
The interim report has been prepared in accordance with IAS 34, Interim
Financial Reporting.
DIRECTORSHIP CHANGES
Mr A Mabogoane did not seek re-election at the AGM held on 28 July 2005. The
company takes this opportunity to thank Mr Mabogoane for his role and
leadership as the Chairman of the Company.
CONTINGENT LIABILITY
NAIL and its partners Metropolitan Life Limited and Nedbank Limited (`the
parties"), entered into an agreement in 1998 whereby they assumed all
responsibility for the management, collection and funding of the African Bank
Debtors" Book, which was excluded from the sale of the African Bank to African
Bank Investments Limited.
NAIL"s contingent liability at 30 June 2005 for its portion of the additional
funding required in the event that the total book was uncollectible amounts to
R57,6 million (31 Dec 2004 R61,9 mil- lion).
The parties are in the process of investigating options to sell the underlying
book.
ASSET DISPOSAL PROCESS
The various claims and preference shares in Motsamai Media (Pty) Limited and
Makana SPV (Pty) Limited which hold 24,9% of Kaya FM and the loans to P4 Radio
Cape Town (Pty) Limited and P4 Radio Durban (Pty) Limited were disposed of to
Makana Investments (Pty) Limited for an amount of R26 million during the review
period.
PRIMEDIA LIMITED (`PRIMEDIA") OFFER
NAIL announced on 17 December 2004 that it had received a firm intention to
make an offer from Primedia to acquire all the issued ordinary and `N" ordinary
shares ("NAIL share") in NAIL as one indivisible transaction. Shareholders are
referred to the announcement for the full terms of the offer.
The salient terms of the offer are:
The offer price of R0,356 per NAIL share in cash. NAIL will have no
liabilities and no assets, except 24,9% of Kaya FM (Pty) Limited, the various
loans to P4 Radio Cape Town (Pty) Limited and P4 Radio Durban (Pty) Limited
("P4 Loans") and various claims and preference shares in Motsamai Media (Pty)
Limited and Makana SPV (Pty) Limited ("the SPV interests") which hold 24,9% of
Kaya FM.
The offer price is reduced by R0,146 per NAIL share if the SPV interests have
been sold or recovered and R0,059 per NAIL share if the P4 Loans have been sold
or repaid.
Interest in the event NAIL has not disposed the SPV interests and the P4
Loans will amount to 0,228 cents per month from 1 April 2005.
Conditions precedent
NAIL"s disposal of Hertz.
Regulatory approvals, to the extent required, including but not limited to
the JSE Limited, the Securities Regulation Panel and the Competition Authority.
The sale of the SPV interests and P4 Loans (as reported under Asset Disposal
Process) has the effect of reducing the Primedia offer to R0,151 per NAIL share
in cash.
The outstanding conditions before the offer will become operative are the
regulatory approvals as detailed above and the resolution of the African Bank
Debtors Book as disclosed under Contingent Liability above.
AME OFFER FOR KAYA FM
On 11 July 2005, NAIL received an offer of R21 million for its 24.9% stake in
Kaya FM. The Primedia offer targeting the same asset indicated that it has NAIL
shareholder support exceeding 50%. NAIL requested AME to provide it with an
indication of the level of NAIL shareholder support that their offer has before
preceeding with the incurring of expenses in the preparation of a disposal
circular for the transaction. The original offer expired on 31 July 2005, AME
made a new offer on 4 August 2005, but todate has not provided NAIL with an
indication of NAIL shareholder support for their offer. NAIL is in the process
of canvassing the major NAIL shareholders to determine whether the AME offer
has a chance of success.
POST-BALANCE SHEET EVENT
Effective 1 September 2005 Hertz was sold to Unitrans Motors for an amount of
R42,5 million.
REVIEW OF RESULTS
The results are not comparable with the previous year as most of the operating
businesses were disposed of last year. The performance this period reflects the
results of 24,9% of Kaya and 60% of Hertz.
F TITI G SNELGAR
29 September 2005
DIRECTORS: G Chadwick, R Kevan, S Macozoma, K Setzin, G Snelgar, F Titi
Date: 30/09/2005 04:10:47 PM Produced by the JSE SENS Department
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