| Fri 28 Oct 2005, 17:05 | | Kelgran Limited - Reviewed provisional results for |
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Kelgran Limited - Reviewed provisional results for the year ended 30 June 2005
KELGRAN LIMITED
Dimension Stone Specialists
Incorporated in the Republic of South Africa Registration Number 1975/004595/06
Code KLG
ISIN ZAE000003885
("Kelgran")
Reviewed provisional results for the year ended 30 June 2005
Income statement for the year ended 30 June 2005
Reviewed Audited
2005 2004
R"000 R"000
Revenue - 182 501
Cost of sales - (215 590)
Gross loss - (33 089)
Other operating income 3 817 83 634
Other operating expenses (2 394) (100 742)
Operating profit/(loss) 1 423 (50 197)
Net finance costs 2 (10 846)
Profit/(loss) before taxation 1 425 (61 043)
Taxation - 66
Profit/(loss) from ordinary activities 1 425 (60 977)
Minority interest - 113
Net profit/(loss) attributable to ordinary 1 425 (60 864)
shareholders
Reconciliation between basic profit/(loss)
and headline profit/( loss):
Profit/(loss) per income statement 1 425 (60 864)
Loan account written off (1 117) 4 985
Impairment of associate - 16 398
Profit on dilution of ownership in - (47 928)
subsidiary
Profit on sale of property plant and - (123)
equipment
Retrenchment costs - 5 485
Headline profit/(loss) 308 (82 047)
Profit/(loss) per share (cents)
- basic 1.5 (64.7)
- diluted 1.5 (64.7)
- headline 0.3 (87.3)
Dividends paid per share(cents)
- interim - -
- final - -
Weighted average number of shares ("000) 94 034 94 034
Number of shares in issue ("000) 94 034 94 034
Fully diluted number of shares ("000) 94 034 94 034
Cash flow statement for the year ended 30 June 2005
Reviewed Audited
2005 2004
R"000 R"000
Cash flows utilised in operating activities
Cash (utilised in)/generated by operations (1 739) 6 736
Net finance costs 2 (10 846)
Taxation received - 136
Net cash outflow from operating activities (1 737) (3 974)
Cash flows from investing activities
Purchase of property, plant and equipment - (2 581)
Proceeds on disposal of property, plant and - 491
equipment
Disposal of subsidiaries - 69 496
Loans to contractors - 10 309
Decrease in associate loan 1 116 -
Net cash inflow from investing activities 1 116 77 715
Cash flows from financing activities
Shareholders" loan incurred 620 -
Net cash inflow from financing activities 620 -
Net (decrease)/increase in cash and cash (1) 73 741
equivalents
Cash and cash equivalents at beginning of 144 (73 597)
the period
Cash and cash equivalents at the end of the 143 144
period
Balance sheet as at 30 June 2005
Reviewed Audited
2005 2004
R"000 R"000
ASSETS
Non - current assets 30 000 27 300
Financial assets 30 000 27 300
Current assets 143 144
Bank and cash 143 144
Total assets 30 143 27 444
EQUITY AND LIABILITIES
Capital and reserves 28 800 27 375
Non-current liabilities 620 -
Amount due to holding company 620 -
Current liabilities 723 69
Trade payables 613 -
Other payables 110 69
Total equity and liabilities 30 143 27 444
Net asset value per share (cents) 31.3 29.1
Statement of changes in equity for the year ended 30 June 2005
Retained
Non- earnings/
distribu- (accu-
Share Share table mulated
capital premium reserves loss) Total
R"000 R"000 R"000 R"000 R"000
Balance at 1 July 2003 1 881 71 572 6 065 8 908 88 426
Movements during the (187) (187)
year
Net loss for the year (60 864) (60 864)
Balance at 30 June 2004 1 881 71 572 5 878 (51 956) 27 375
Net profit for the year 1 425 1 425
Balance at 30 June 2005 1 881 71 572 5 878 (50 531) 28 800
COMMENTS
Nature of Business
Kelgran"s only asset is a 49% interest in Kelgran Investments (Pty) Limited
("Kelgran Investments" or "the associate"), whose subsidiaries mine granite on
group-owned and leased land. The major portion of the associate"s production is
sold for export.
As the activities conducted by the associate comprise an integrated operation,
it is regarded as a single primary business segment, on which all information in
this announcement is disclosed.
Results
The associate"s revenue decreased by 31% from R182,5 million to R127,1 million,
mainly as a result of all sales during the period under review being concluded
on a free-on-truck basis, compared to the previous year when 37% of sales were
done on a CIF basis, which was inclusive of freight and forwarding charges.
Despite an increase in foreign currency prices to recover increases in freight
charges, the average Rand price received by the associate declined as a result
of the substantially stronger Rand. Sales volumes were 3% higher than last
year.
The associate incurred a loss before tax of R64,0 million compared to a loss of
R114,7 million in the previous year. The investment in associate has been fully
impaired.
The associate"s quarrying operations performed as expected, with both production
volumes and costs being stable. Production was maintained at levels in line
with demand. Only the Rustenburg and African Red quarries were operational.
The associate"s operations at the factory were discontinued in December 2004 due
to the fact that the tiles and products for the monument market produced at the
factory were no longer able to compete locally and internationally.
Accounting policies
The results have been prepared on a basis consistent with the accounting
policies applied in the prior year and in accordance with the South African
Statements of Generally Accepted Accounting Practice applicable to financial
reporting, and the requirements of the Companies Act. These results have been
reviewed by the auditors, KPMG Inc., and a copy of their review report is
available for inspection at Kelgran"s registered office.
Prospects
In terms of the agreement with JVK, JVK will continue to manage Kelgran
Investments, bringing quarry operations expertise to the fold, as well as
performing the marketing and distribution functions for the export market.
The board of directors is in the process of evaluating various options impacting
on the future strategy of Kelgran, the requirements to recapitalise Kelgran
Investments and the initiatives regarding the continued listing of Kelgran on
the JSE Limited. Shareholders are referred to the further cautionary
announcement dated 26 October 2005.
Related parties
In terms of the agreement with JVK, JVK will purchase, or procure the purchase,
from Kelgran Investments of all granite produced at the operational quarries
which are suitable for the export market, up to the production quantities
agreed, on a free-on-truck basis.
Dividend
The Directors have resolved not to declare a dividend.
By order of the Board
VITTORIO DI CAPUAChief Executive Officer
28 October 2005
Registered Office: Suite 3, Culross Court, 16 Culross Road, Bryanston, Sandton
2021
Transfer Secretaries: Computershare Investor Services 2004 (Pty)
Limited 70 Marshall Street Johannesburg 2001
Sponsor: Bridge Capital Services (Pty) Ltd
Executive Directors: V di Capua** (Chief Executive Officer and Executive Deputy
Chairman) Dato" Choo Eng Guan* and FP van Wyk
Non-executive Directors: Dato" Yap Yong Seong* (Chairman) Dato" Murad Mohamed
Hashim* Yap Wee Keat* and Yap Wee Chun* *Malaysian ** Italia
Date: 28/10/2005 05:05:36 PM Produced by the JSE SENS Department
