| Mon 10 Oct 2005, 7:05 | | Stratcorp Limited - Interim Results |
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Stratcorp Limited - Interim Results
Stratcorp Limited
(Registration number: 2000/031842/06)
(Incorporated in the Republic of South Africa)
Share Code: STA & ISIN Code ZAE000034294
INTERIM REPORT
Group unaudited results for the six months ended 31 August 2005 were as follows:
Abridged Group Income Statement 6 Months 6 Months 12 Months
ending ending ending
31 August 31 August 28 February
2005 2004 2005
(unaudited) (unaudited) (audited)
Restated Restated
R"000 R"000 R"000
Revenue 7 030 5 263 11 213
Profit / (loss) from operations 493 -294 -404
Net interest 248 -187 -12
Profit / (loss) before taxation 741 -481 -416
Taxation -739 - 347
Net profit / (loss) for the period 1 480 -481 -763
Attributable to:
Minority interests (170) - -
Equity shareholders of parent 1 650 -481 -763
company
1,480 -481 -763
Number of ordinary shares in issue
(`000) 48 238 46 574 46 538
Treasury shares 41 022 31 043 31 079
Total number of shares in issue 89 260 77 617 77 617
Weighted average number of:
Ordinary shares in issue (`000) 46 724 44 952 45 016
Treasury shares in issue (`000) 32 169 31 079 31 706
Total weighted average number of 78 893 76 031 76 722
shares in issue
Cents Cents Cents
Basic earnings per share with
consolidation of share trusts
3.53 -1.07 -1.69
Basic earnings per share without
consolidation of share trusts
2.09 -0.63 -0.99
Headline earnings per share with
consolidation of share trusts
2.79 -0.88 -0.93
Headline earnings per share without
consolidation of share trusts
1.65 -0.52 -0.54
Dividend per share - - -
Reconciliation of headline earnings
Basic earnings 1 650 -481 -763
Impairment losses - 346
Reversal of impairment losses -346 - -
Amortisation of goodwill - 87 -
Headline earnings 1 304 -394 -417
Abridged Group Balance Sheet At At At
31 August 31 August 28 February
2005 2004 2005
(unaudited) (unaudited) (audited)
Restated Restated
R"000 R"000 R"000
Non-current assets 11 032 9 655 8 803
Property, plant & equipment 610 406
Intangible assets 2,275 2,163
Investment in associates 4,447 2,934
Investments 2,791 2,070
Loans receivable 427 641
Deferred tax 482 589
Current assets 8 895 8 571 7 790
Investments 6,025 6,030
Inventories 1,429 177
Trade & other receivables 1,224 430
Cash and cash equivalents 217 1,153
Total assets 19 927 18 226 16 593
Capital and reserves 16 010 9 875 8 975
Issued capital 12,811 10,438
Distributable reserves 3,369 (1,463)
Minority interest (170) -
Non-current liabilities 1 005 2 294 1 288
Borrowings 1,005 1,288
Current liabilities 2 912 6 057 6 330
Taxation - 846
Trade and other payables 1,412 3,983
Current portion of borrowings 1,500 1,500
Total equity and liabilities 19 927 18 226 16 593
Number of ordinary shares in issue 48 238 46 574 46 538
Treasury shares 41 022 31 043 31 079
Total number of shares in issue 89 260 77 617 77 617
Cents Cents Cents
Net asset value per share with
consolidation of share trusts
33.2 21.2 19.3
Net asset value per share without
consolidation of share trusts
17.9 12.7 11.6
Net tangible asset value per share
with consolidation of share trusts
28.5 16.7 14.6
Net tangible asset value per share
without consolidation of share
trusts
15.4 9.8 8.6
Group Statement of Share Retained Total Minority Total
Changes in Equity Capital Earnings Interest Equity
R"000 R"000 R"000 R"000 R"000
Balance at 01 March 9,727 (670) 9,027 - 9,027
2004
Issue of shares 1,000 1,000 - 1,000
Share issue costs (100) (100) - (100)
Reduction of share (177) (177) - (177)
capital
Treasury shares (12) (12) - (12)
Restated net loss (763) (763) - (763)
for the year
Balance at 01 March 10,438 (1,463) 8,975 - 8,975
2005
Issue of shares 3,726 3,726 - 3,726
Share issue costs (1,352) (1,352) - (1,352)
Equity profit on 3,182 3,182 - 3,182
reduction of
treasury shares
Treasury shares (1) (1) - (1)
Net profit for the 1,650 1,650 (170) 1,480
period
Balance at end of 12,811 3,369 16,180 (170) 16,010
period
Abridged Group Cash Flow Statement 6 Months 6 Months 12 Months
ending ending ending
31 August 31 August 28 February
2005 2004 2005
(unaudited) (unaudited) (audited)
Restated Restated
R"000 R"000 R"000
Cash flow from operating activities -4 311 3 496 639
Net interest paid 248 -187 -12
Cash flow from investing activities -2 358 -2 944 -1 331
Cash flow from financing activities 5 485 748 1 338
Net cash flow for period -936 1 113 634
Cash and cash equivalents at
beginning of period 519
1 153 573
Cash and cash equivalents at end of
period
217 1 686 1 153
Comments on results
Turnovers increased by 33.57% and the pre tax profit increased by 267% in
comparison with the same period last year. The after tax profit reflects a
higher figure than the pre tax profit. This is due to a tax adjustment relating
to the 2004 financial year that was adjusted in the current financial year. The
ongoing process of establishing company owned venues in order to increase the
client base is resulting in positive growth. The client base has grown
satisfactory. Traditionally, turnovers for the second period are higher than the
first period and the board anticipates that the profit realized for the next 6
months will increase in line with the expected increase in Sales for the full
year. Cash flow from operating activities should for the full year be adequate
to sustain internal growth. The board is currently evaluating various
propositions in order to expand its investments and will report to shareholders
over time if any positive acquisitions have materialised.
Reversal of impairment loss
Included in earnings reported, is a reversal of impairment losses of R346,000.
The impairment loss was recognised during the 2005 financial year for one of the
Group"s associate companies. The directors are of the opinion that there has
been a significant upswing in the associate"s operations and that the associate
will be profitable in the near future.
Basis of preparation
The results of the Group for the six months ending 31 August 2005 have been
prepared in accordance with the Group"s accounting policies which comply with
International Financial Reporting Standards (IFRS) and IAS 34 - Interim
Financial Reporting. The standards are subject to ongoing review and may change.
The Group will be reporting under IFRS in full in respect of the annual
financial statements for the year ending 28 February 2006. The Group"s
transition date is 1 March 2004 and IFRS 1 - First Time Adoption of
International Financial Reporting Standards has been applied in preparing this
financial information. There were no material adjustments retrospectively.
The accounting policies applied are consistent with those applied during the
comparative periods.
No segment analysis was prepared as the Group is not operating in different
market segments.
Corporate Governance
The Group is committed to maintaining the high standards of governance as
embodied in the King Report on Corporate Governance.
The report has not been audited or reviewed by the Company"s auditors.
Restated figures
1. Six months ending 31 August 2004
The Group has consolidated its Employee Incentive Trust and Management
Performance Trust for the first time in the 2005 financial year. The result of
this consolidation is an increase in treasury shares of the company from nil to
35 million, resulting in a decrease in earnings per share from -0.63 cents per
share previously reported to -1.07 cents per share. The net asset value per
share increased from 12.9 cents per share previously reported to 21.2 cents per
share as a result of the consolidation of the share trusts, and as a result of
the reclassification of self-developed computer software from a tangible asset
to an intangible asset as per IAS38 (AC129).
2. Twelve months ending 28 February 2005
Error in figures reported for 28 February 2005
Commission paid relating to a project funded at the end of February 2005 was not
accrued for in the 2005 financial year. The commission amounted to R226,493
after tax. Earnings per share decrease from -1.2 cents previously reported to -
1.69 cents per share. Headline earnings per share decreased from -0.4 cents per
share to -0.93 cents per share. Net asset value per share decreased from 19.8
cents per share previously reported to 19.3 cents per share. Net tangible asset
value per share decreased from 15.1 cents per share previously reported to 14.6
cents per share.
Wholly owned subsidiaries
StratEquity (Pty) Ltd (100%)
StratEquity"s subscription client base has increased from 6 677 to 17 390 over
the reporting period. The monthly premium increased from R633 000 to R2 567 000.
StratEquity has supplied funding for developing companies over the past year
totaling R18 million. The figure for the total 12 months should reach R23
million. The company was also approved as a Financial Services Provider by the
Financial Services Board (FSB) on 16 August 2005. This means that StratEquity
can expand its product range.
ICI Marketing (Pty) Ltd (100%)
ICI was previously a division of StratEquity. On 1 March 2005, the operations of
ICI was moved into a separate entity. The company is profitable and is
responsible for the distribution of StratEquity"s products. In addition ICI
generates other sources of income, which is not related to fees earned from
StratEquity.
StratFund Portfolio Managers (Pty) Ltd (100%)
As a result of StratEquity obtaining an Investment Managers license from the FSB
there is no need to duplicate this function. A suitable buyer is currently
sought.
Other matters
StratCorp issued 11 642 539 shares for cash at 32 cents per share to independent
shareholders in July 2005. Mr. P de W Louw resigned as director effective 1
September and Mr. JN de Beer was appointed as Group Financial Director.
Stratcorp Limited acquired a 51% shareholding in Citadin Holdings Ltd. Citadin
is a residential property development group and concentrates its activities in
the lower to middle end of the buyers market. Citadin is currently engaged in a
R54 million development in the Northern suburbs of Pretoria.
Cautionary Announcement
The company issued a Cautionary Announcement on 27 September 2005 stating that
it is in negotiations and if concluded successfully can have a material effect
on the company.
Dividends
No interim dividends have been declared.
On behalf of the board
DB Harington
CEO
6 October 2005
Registered Offices Transfer Secretaries
Suite 1001 Ultra Registrars (Pty) Ltd
267 West Avenue 11 Diagonal Street
Centurion Johannesburg, 2001
Pretoria
Directors : P J de Jongh* (Chairman); D B Harington (CEO); JN de Beer; JJ
Steynberg*
(*Non-executive)
Company Secretary: PH van Zyl
Date: 10/10/2005 07:05:08 AM Produced by the JSE SENS Department
