| Mon 31 Oct 2005, 17:04 | | Buildmax - Reviewed Interim results for the six mo |
|
Buildmax - Reviewed Interim results for the six months ended 30 September 2005
BUILDMAX LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 1995/012209/06)
SHARE CODE: BDM & ISIN: ZAE000011250
("BUILDMAX" OR "THE GROUP")
Reviewed Interim results for the six months ended 30 September 2005
The reviewed results of Buildmax Limited and its subsidiaries for the six months
ended 30 September 2005 are set out below:
6 months 6 months 12 months
% 30/09/2005 30/09/2004 2005/03/31
Change (reviewed) (unaudited) (audited)
R"000 R"000 R"000
ABRIDGED INCOME STATEMENT
Gross revenue 18.33 53,048 44,830 91,959
Continuing operations 36,369 36,369 79,560
Discontinued operations 0
Operating profit as 3,302 2,545 5,855
previously stated
Continuing operations -3,989 -3,989 520
Discontinued operations 0
Profit of sale of 0 0 0
discontinued operations
Adjustment for leases - -481 -555 -1,022
AC105
Operating profit adjusted 2,821 1,990 4,833
Net interest received 204 103 267
Profit before taxation 44.53 3,025 2,093 5,100
Taxation -1,099 -462 701
Profit for the period 18.09 1,926 1,631 5,801
Exceptional items - - -3,485
Earnings for the period 18.09 1,926 1,631 2,316
Average number of shares in 41,806 41,806 41,806
issue ("000)
Earnings per share (cents) 18.09 4.61 3.90 5.54
Profit for the period 1,926 1,631 2,316
Divided by weighted average 41,806 41,806 41,806
number of shares in issue
CALCULATION OF HEADLINE
EARNINGS
Headline earnings per share 23.09 4.54 3.69 13.44
(cents)
Profit before taxation 3,025 2,093 5,100
Adjusted for:
(Profit) on disposal of (28) (89) (181)
property, plant and
equipment
(Profit) on sale of -
discontinued operations
Taxation (1,099) (462) 701
Headline earnings 1,898 1,542 5,620
Divided by weighted average 41,806 41,806 41,806
number of shares in issue
ABRIDGED BALANCE SHEET
ASSETS
Non-current assets
Property, plant and 9,474 9,345 9,453
equipment
Investments - 2,578 -
Deferred taxation 1,776 1,242 2,475
Current assets 41,838 34,528 39,821
Total assets 53,088 47,693 51,749
EQUITY AND LIABILITIES
Share capital and reserves 37,299 35,106 35,791
Long-term liabilities 58 100 69
Current liabilities 15,731 12,487 15,889
Total equity and 53,088 47,693 51,749
liabilities
Net asset value per share 6.25 89.22 83.97 85.61
(cents)
Share capital and reserves 37,299 35,106 35,791
Divided by weighted average 41,806 41,806 41,806
number of shares in issue
Net tangible asset value 6.25 89.22 83.97 85.61
per share (cents)
ABRIDGED CASH FLOW
STATEMENT
Operating activities 97 -1,537 4,439
Investing activities -982 421 1,183
Financing activities -428 9 -21
Net cash -1,313 -1,107 5,601
(utilised)/generated
Cash and cash equivalents 9,762 4,161 4,161
beginning of period
Cash and cash equivalents 176.65 8,449 3,054 9,762
end of period
ABRIDGED STATEMENT OF
CHANGES IN EQUITY
Equity beginning of period 35,791 33,949 33,949
Restatement of prior years - -474 -474
AC105-Leases
Profit for the period 1,926 1,631 2,316
Dividends paid -418 - -
Equity end of period 6.25 37,299 35,106 35,791
COMMENTARY
Revenue for the first six month of this financial year continues to show strong
growth on the comparable period. The results reflect the continued boom in the
construction industry as well as the effect of the low interest rates and higher
consumer spending.
Turnover has increased by 18% from R44.8 million to R53 million. Increased
sales volumes, together with cost reductions and improved operational
efficiencies, resulted in operating profit increasing by 44% to R3.025 million
with all divisions reporting improved margins and profitability. The group has
provided taxation of R1.099 million. Earnings for the period increased by 18% to
R1.926 million. Headline earnings increased by 18% to 4.54 cents per share.
Net asset value per share increased to 89.22 cents. Stock levels have increased
by 12% due to the higher trading volumes as well as increased stock holding in
preparation for the peak months - October, November and December.
OPERATIONAL REVIEW
The group kept up the momentum of last year and in general, all divisions
benefited from the improved trading conditions.
The Galvanised division continued to show growth in all aspects. During the
latter part of the reporting period, supply shortages by the primary steel
producer in South Africa resulted in increased costs. The board is however
happy to report that turnover as well as profit shows good growth compared to
the same period last year.
During this reporting period, the Concrete division showed strong growth on the
back of increased demand. This division is seen by the board as the primary
growth sector in the group and our focus for further expansion.
The Timber division is still hampered by the influence of the strong rand on
imports, however, it is still profitable for this reporting period. They
specialise mainly in hardwoods for the shopfitting and furniture industry and
balau decking and meranti to the building industry.
The Aluminium division has shown good organic growth attributable to the
building boom and has been operating 19 installation teams since the beginning
of September, five teams more than the same period last year. The steep
increases in the fuel price have an effect on operating expenses in this
division.
Capital expenditure for the first half of the year amounted to R1.022 million.
The Group has also committed itself to a further R4 million in capital
expenditure to install a VBX4 machine at Watson Concrete. This machine will be
used for manufacturing stock bricks and pavers and management is confident that
turnover and profit of Watson Concrete will show positive results.
The group does not have any overdraft and has been self reliant on cash to
achieve its expectations, but will be using external borrowings to finance the
purchase of the new machine for Watson Concrete.
PROSPECTS
Business confidence levels in the construction industry remains positive,
domestic growth is accelerating, the rand is remaining stable against major
currencies and interest rates and inflation have remained under control. We are
confident that these growth levels, barring unforeseen circumstances, will
continue for the foreseeable future and will certainly reflect in our
performance in this financial year ending in March 2006. Our vision for the
future is also reflected in the latest figures published by the Bureau of
Economic Research stating that consumer confidence is still high and even though
it won"t grow at the high pace that we have seen the past year, it will continue
at a healthy level for at least the next twelve months. Not even the possible
increase in interest rates had an effect as yet, the only possible risk is that
the higher fuel price could reduce the purchasing power of households.
DIVIDENDS
No dividend has been declared or recommended.
ACCOUNTING POLICIES AND REVIEW
The results have been prepared in accordance with South African Statements of
Generally Accepted Accounting Practice applicable to interim financial reporting
and the accounting policies applied are consistent with those of the prior year
except for the adoption of IAS17 (AC105 - Leases).
Management is currently finalising the compliance with International Financial
Reporting Standards, which will be completed before our year end in March 2006.
At this stage, the indication is that there will be an immaterial effect on the
financial figures.
The Group restated operating lease payments in line with AC 105 - Leases and
Circular 7/2005 issued by SAICA on 2 August 2005 with retrospective effect.
These statements require payments under an operating lease to be recognised as
an expense on a straight line basis over the lease term. This has resulted in a
restatement of Retained Earnings as at 31 March 2004 of R474 193 and a
restatement of the prior year"s income of R725 925 after provision for deferred
taxation has been made.
The interim financial results have been reviewed in terms of Rule 3.23 of the
Listing Requirements of the JSE Limited ("JSE") by the Group"s auditors, Meagher
Moynihan. This review opinion is available for inspection at the registered
office.
For and behalf of the board.
I D P Burger
Director
N R Jansen
Director
31 October 2005
Directors:
I D P Burger (Chairman)
N R Jansen (Acting CEO)
M D Lamola (Independent Non-Executive Director
M D Smullen (Non-Executive Director)
J P G Vorster (Executive Director)
Date: 31/10/2005 05:05:59 PM Produced by the JSE SENS Department
