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Nampak Limited -Audited Group Results And Declaration Of Dividend
Nampak Limited
(Registration number 1968/008070/06)
(Incorporated in the Republic of South Africa)
JSE Code: NPK
ISIN: ZAE 000071676
Audited group results for the year ended 30 September 2005
ABRIDGED GROUP INCOME STATEMENT
2005 2004
(Restated) Change
Notes Rm Rm %
Revenue 15 583.1 17 494.6 (10.9)
Continuing operations 15 583.1 17 178.9 (9.3)
Discontinuing operations - 315.7 (100.0)
Profit before abnormal 1 1 307.6 1 562.1 (16.3)
items
Net abnormal profit 2 48.2 70.5
Profit from operations 3 1 355.8 1 632.6 (17.0)
Continuing operations 1 355.8 1 379.5 (1.7)
Discontinuing operations 4 - 253.1 (100.0)
Net finance costs 5 (103.6) (149.0)
Income from investments 33.8 15.6
Share of loss in (2.4) -
associate
Profit before tax 1 283.6 1 499.2 (14.4)
Income tax 498.4 521.7
Profit after tax 785.2 977.5 (19.7)
Minority interest 4.1 10.4
Net profit for the year 781.1 967.1 (19.2)
Number of ordinary and
preferred
ordinary shares in issue 701 171 641 574
(`000)
Number of ordinary shares
in
issue (`000) - net of 641 888 641 574
treasury shares
Weighted average number
of ordinary shares on
which
headline earnings and
basic earnings per share
are based (`000) 638 262 640 958
Weighted average number
of ordinary shares on
which
diluted headline earnings
and diluted basic
earnings per
share are based (`000) 642 385 644 705
Headline earnings per 119.2 146.1 (18.4)
ordinary share (cents)
Basic earnings per share 122.4 150.9 (18.9)
(cents)
Dividend per share 83.6 83.6
(cents)
Fully diluted headline 118.4 145.3 (18.5)
earnings per share
(cents)
Fully diluted earnings 121.6 150.0 (18.9)
per share (cents)
Determination of headline
earnings
Net profit for the year 781.1 967.1
Less: preference dividend (0.1) (0.1)
Adjusted for:
Impairment losses on 152.3 127.9
goodwill, plant and
equipment
Reversal of impairment (5.0) -
losses on plant and
equipment
Goodwill amortised - 60.5
Net loss/(profit) on 20.4 (216.5)
disposal of businesses
Net profit on disposal of (439.3) (13.7)
property, plant and
equipment
Pension fund curtailment 173.9 -
loss on disposal of
business
Write off of due 5.7 -
diligence costs
Tax effects 71.7 11.3
Headline earnings for the 760.7 936.5 (18.8)
year
ABRDGED GROUP BALANCE SHEET
2005 2004
(Restated)
Note Rm Rm
Assets
Non-current assets 5 166.1 5 512.1
Property, plant and equipment 3 941.1 4 228.1
Goodwill and other intangible assets 1 059.9 1 240.4
Non-current financial assets and 165.1 43.6
investment in associate
Current assets 5 198.8 5 443.6
Inventories 2 049.9 2 055.9
Trade and other receivables 2 516.2 2 688.2
Bank balances, deposits and cash 6 632.7 699.5
Total assets 10 364.9 10 955.7
Equity and liabilities
Capital and reserves 5 235.6 5 383.1
Capital 1 927.6 2 042.4
Non-distributable reserves (593.0) (249.6)
Accumulated profits 3 901.0 3 590.3
Minority interest 29.4 32.8
Non-current liabilities 1 703.0 1 675.6
Interest bearing debt 6 929.7 1 091.5
Net long-term retirement benefit 252.3 161.9
obligation
Fixed escalation operating lease 23.4 23.6
accrual
Net deferred tax liabilities 497.6 398.6
Current liabilities 3 396.9 3 864.2
Trade, other payables and provisions 2 980.2 2 938.9
Interest bearing debt 6 281.0 752.9
Net tax liabilities 135.7 172.4
Total equity and liabilities 10 364.9 10 955.7
Total borrowings:total shareholders" 23% 36%
funds
Net borrowings:total shareholders" 11% 21%
funds
Total liabilities:total 97% 109%
shareholders" funds
Net asset value per ordinary share
(cents) calculated
on number of ordinary shares in
issue
of 641 887 632 (2004: 641 574 291) 816 839
Tangible net asset value per
ordinary share (cents)
calculated on number of ordinary
shares in
issue of 641 887 632 651 646
(2004: 641 574 291)
GROUP STATEMENT OF CHANGES IN EQUITY
2005 2004
(Restated)
Note Rm Rm
Equity at beginning of year 5 383.1 4 855.1
Changes in accounting policies and 7 (82.4) (16.5)
prior year restatement
Changes in capital 589.8 9.2
Share capital - share option scheme 0.2 0.1
- new issue 3.2 -
- shares cancelled (0.5) -
Share premium - share option scheme 50.9 9.1
- new issue net of share issue 684.3 -
expenses
- cancellation of share premium
on shares cancelled (148.3) -
Changes in treasury shares (704.6) (0.5)
Consolidation of shares held by share - (0.5)
purchase trust
Consolidation of shares held by Black (414.1) -
Management Trust
Consolidation of shares held by
Red Coral Investments 23 (Pty) (290.5) -
Limited
Changes in non-distributable reserves (193.0) 45.3
Decrease in foreign currency (108.5) (41.8)
translation reserve
Hyperinflation capital adjustment (87.7) 88.7
Financial instruments - hedging 1.4 (1.6)
Share of non-distributable reserves 1.8 -
in associates
Changes in accumulated profit 242.7 490.5
Net profit for the period 781.1 967.1
Ordinary shares - dividends (535.1) (476.5)
Preference shares - dividends (0.1) (0.1)
Share buy-back (3.2) -
Equity at end of year 5 235.6 5 383.1
ABRIDGED GROUP CASH FLOW
2005 2004
(Restated)
Note Rm Rm
Cash operating profit 1 925.5 2 381.7
Working capital changes 87.9 (251.5)
Cash generated from operations 2 013.4 2 130.2
Net finance costs (96.5) (149.0)
Income from investments 33.8 15.6
Tax paid (424.3) (645.1)
Retirement benefit contributions and (81.7) (88.4)
settlements
Replacement capital expenditure (347.8) (394.4)
Cash flow from operations 1 096.9 868.9
Dividends paid (536.1) (477.3)
Net cash inflow from operating 560.8 391.6
activities
Net cash inflow/(outflow) from 168.5 (161.9)
investing activities
Net cash inflow before financing 729.3 229.7
activities
Net cash outflow from financing (306.4) (277.7)
activities
Net increase/(decrease) in cash and 422.9 (48.0)
cash equivalents
Cash and cash equivalents at (28.3) 17.2
beginning of year
Translation of cash in foreign (19.0) 2.5
subsidiaries
Cash and cash equivalents at end of 6 375.6 (28.3)
year
NOTES
2005 2004 Change
Rm Rm %
1. Profit before abnormal items
South Africa 1 088.9 1 186.6 (8.2)
Africa 81.0 142.8 (43.3)
Europe 137.7 232.7 (40.8)
1 307.6 1 562.1 (16.3)
2. Net abnormal profit
Retrenchment costs 104.9 40.8
Restructuring costs 45.1 19.8
Impairment losses on goodwill,
plant and equipment 152.3 127.9
Reversal of impairment losses on
plant and equipment (5.0) -
Net profit on disposal of property (428.2) (7.6)
Net loss/(profit) on disposal of 20.4 (216.5)
businesses
Pension fund curtailment on
disposal of business 173.9 -
Net monetary adjustment - 8.2 15.1
hyperinflation
Financial instruments fair value 9.8 (70.9)
adjustment
FEC costs on plant and equipment 0.7 20.9
Pension fund curtailment gain on (70.6) -
restructure
Change in estimate - provision (59.7) -
(note 8)
(48.2) (70.5)
3. Profit from operations
South Africa 1 054.0 1 411.0 (25.3)
Africa 71.5 127.7 (44.0)
Europe 230.3 93.9 145.3
1 355.8 1 632.6 (17.0)
4. Discontinued operations
Profit on disposal of discontinued - 213.2
operations
Profit from discontinued - 39.9
operations
- 253.1
5. Net finance costs
Interest paid 200.6 217.7
Interest received (97.0) (68.7)
103.6 149.0
6. Cash and cash equivalents
Interest bearing debt (1 210.7) (1 844.4)
Less long-term liabilities 929.7 1 091.5
Less short-term portion of long- 23.9 25.1
term liabilities
Less bank balances, deposits and 632.7 699.5
cash
375.6 (28.3)
7. Changes in accounting policies and prior year restatement
The group has changed its accounting policies in respect of goodwill to comply
with the requirements of IFRS3 - Business Combinations, IAS36 (AC140) -
Impairment of Assets and IAS21 - Accounting for the Effects of Changes in
Foreign Exchange rates. In line with the transitional provisions of IFRS3
(AC140), accumulated amortisation was set off against the cost of goodwill and
the revised carrying amount is no longer amortised. The carrying amount of
negative goodwill was written off against opening accumulated profits. Goodwill
previously denominated in rand that relates to acquisitions whose functional
currency is not rand denominated has been restated to these respective
functional currencies and translated at the closing rate in terms of the
transitional provisions of IAS21.
Comparative figures were not restated.
The aggregate effect of the changes in
accounting policies are as follows:
Balance sheet:
Decrease in foreign currency translation reserve (150.4)
Increase in accumulated profits 68.0
Net decrease in reserves (82.4)
Represented by:
Intangible assets
Goodwill restated in functional currency
and translated at closing rate 150.4
Negative goodwill written off (68.0)
82.4
Income statement:
Impairment of goodwill (IFRS3 and IAS21) 123.4
Net decrease in profit after tax 123.4
Circular 7/2005 was issued by SAICA on 2 August
2005, providing clarification on the
interpretation of IAS17 - Leases. As a result,
leases are now recognised as an expense on a
straight line basis over the lease term.
Previously lease expenses were recognised on a
basis which reflected the cash flows during that
period. Comparative figures have been restated.
The aggregate effect of the change is as
follows:
Balance sheet:
Decrease in accumulated profits (16.7) (16.5)
Represented by:
Increase in non-current liabilities 23.4 23.6
Increase in current liabilities 0.2 -
Decrease in deferred tax (6.9) (7.1)
16.7 16.5
Income statement:
Decrease in rental expenses - -
Deferred tax 0.2 -
Net decrease in profit after tax 0.2 -
The net effect of these adjustments is a
decrease of 19.3 cents in the earnings per share
and no effect on headline earnings per share for
the current year.
8. Change in estimate
Following a review of the estimation process and
availability of new information the group
changed the basis on which provisions for the
write down on inventory to net realisable value
was calculated. As a result, the net realisable
value of inventory increased as follows:
Balance sheet:
Increase in inventories 59.7
Increase in deferred tax (17.3)
42.4
Income statement:
Increase in profit before tax 59.7
Deferred tax (17.3)
Net increase in profit after tax 42.4
9. Supplementary information
Depreciation 644.7 710.0
Amortisation 56.6 90.9
- goodwill - 60.5
- other intangibles 56.6 30.4
Capital expenditure 733.7 995.6
- expansion 385.9 601.2
- replacement 347.8 394.4
Capital commitments 435.5 564.1
- contracted 166.4 237.1
- approved not contracted 269.1 327.0
Lease commitments 500.4 512.6
- land and buildings 342.4 450.1
- other 158.0 62.5
Contingent liabilities 22.9 62.5
COMMENTS
NAMPAK PROFILE
Nampak is the largest and most diversified packaging manufacturer in Africa with
extensive manufacturing operations in South Africa and a further 10 countries on
the African continent. It produces packaging products from metal, glass, paper
and plastics and is a major manufacturer and marketer of tissue products.
It is one of the leading suppliers of folding cartons to the food and healthcare
sectors in Europe and it is the major supplier of plastic bottles to the dairy
industry in the United Kingdom.
The group is actively engaged in the collection and recycling of all forms of
used packaging.
KEY INVESTMENT ACTIVITIES IN 2005
The Short Run plastics business in Europe, which had been underperforming in a
highly competitive market, was sold for GBP21 million effective 30 October 2004.
The Woburn Sands property in the United Kingdom was sold in January 2005 for
GBP40 million of which GBP20 million has been received with the balance due in
equal instalments in January 2006 and 2007.
Effective 1 March 2005 Nampak sold Peters Papers, its paper merchants division,
to Actis, a leading private equity company in emerging markets, for R220
million. The transaction was concluded in partnership with the management of
Peters Papers and Izingwe Capital, a Black Economic Empowerment investment
company.
The group completed a R1 billion Black Economic Empowerment transaction which
has resulted in 5% of its shares being held by employees and 5% by a broad-based
BEE consortium. In order to mitigate the dilution effect of this transaction,
the group implemented a scheme of arrangement whereby it repurchased 10% of its
issued shares from existing shareholders effective 31 October 2005.
Effective 1 October 2005, Wiegand-Glas of Germany acquired 50% of the issued
share capital in Nampak Glass (Pty) Limited for euro 18 million.
Tufbag, which manufactures bulk bags, was sold effective 1 November 2005 for R9
million.
GEOGRAPHICAL PERFORMANCE
Geographical overview
Rm Profit from
Continuing Revenue operations Margin %
operations 2005 2004 2005 2004 2005 2004
South Africa 11 270 11 868 1 054 1 158 9.4 9.8
Rest of Africa 681 886 72 128 10.6 14.4
Europe 3 831 4 882 230 94 6.0 1.9
Intergroup
eliminations (199) (457)
15 583 17 179 1 356 1 380 8.7 8.0
Discontinued
operations
South Africa - 316 - 253
Total 15 583 17 495 1 356 1 633 8.7 9.3
Group
Sales from continuing operations declined 9% to R15.6 billion, of which 8% was
attributable to the sale of Short Run plastics business and Peters Papers.
Profit from continuing operations declined 1.7% due to the reduction in sales,
weaker performance in some larger divisions, significant restructuring costs
incurred during the year and the impact of hyper-inflation in Zimbabwe. European
profits were enhanced by sales of properties. The operating margin improved to
8.7% from 8.0%.
Many initiatives were completed during the year to reposition the group to
better face the challenging business environment. This resulted in a number of
abnormal items which are detailed below:
* profit on sale of the Woburn Sands and other properties amounting to R428
million;
* European pension fund curtailment gain of R71 million following the conversion
of certain UK members from defined benefit to defined contribution;
* gain of R60 million resulting from a change in the basis of valuing
inventories;
* retrenchment costs of R105 million and restructuring costs of R45 million
arising mainly from the closure of two folding cartons factories and one
plastics factory in the United Kingdom and several factory rationalisations in
South Africa;
* goodwill of R123 million written off in Cartons UK and Healthcare as a result
of valuing the business at fair value;
* impairment losses on plant and equipment of R29 million as a result of factory
closures;
* pension fund curtailment loss of R174 million on disposal of the Short Run
plastics business.
Net financing costs reduced by 31% to R104 million as a result of lower interest
rates in South Africa and a further reduction in net borrowings.
Taxation declined from R522 million to R498 million whilst the effective tax
rate increased from 34.8% to 38.8% partly due to impairment losses which do not
qualify as a tax deduction against income, Secondary Tax on Companies (STC) and
the recognition of some prior year tax charges following the receipt of
assessments from the South African Revenue Service.
Headline earnings per share declined by 18% to 119.2c.
Cash generation was strong with R2 billion being generated from operating
activities. Net gearing improved from 21% to 11%.
South Africa
The South African economy enjoyed good growth in the past year and although
demand for durable and semi-durable goods was buoyant, it was less so for non-
durables upon which much of Nampak"s packaging depends. Low inflation and
virtually no increase in the price of paper-based raw materials restrained
selling prices. Direct and indirect exports were lower and accounted for 21% of
packaging sales compared to 26% in 2004.
Polymer prices increased substantially as a result of the rise in oil prices
whilst tinplate steel prices increased well above local inflation as a result of
strong global demand for steel products.
Overall, there was no growth in Nampak"s packaging volumes. Strong gains in
rigid plastics, glass, closures and paper sacks were offset by declines in
beverage cans, corrugated boxes, cartons and flexibles.
Substantial restructuring was undertaken, the costs of which contributed to
profit from operations declining by 17%. Overall, stringent cost-management
resulted in the operating margin remaining at a similar level to that of last
year.
Rest of Africa
Both turnover and operating profit were substantially lower than last year as a
result of hyper-inflation and massive currency depreciation in Zimbabwe which is
expected to continue. The new cartons factory in Nigeria performed well and
approval has been given to expand this facility in 2006.
Europe
Trading conditions in Europe remained highly competitive especially in the
folding cartons sector and were exacerbated by some customers relocating to
other countries. Market share in healthcare and plastic milk bottles was
nevertheless increased.
Excluding the Short Run plastics business, which was sold effective 30 October
2004, sales revenue in pounds was unchanged. Profit on the sale of the Woburn
sands property, offset by the impairment of goodwill, retrenchment and
restructuring costs and pension fund reorganisation, resulted in an increase in
profit from operations.
Segmental Analysis
Metals and Glass
Rm Profit from Operating
Revenue operations margin %
2005 2004 2005 2004 2005 2004
Africa 4 521 4 603 665 562 14.7 12.2
Africa
Overall profitability of this segment improved mainly due to a turnaround in the
glass bottle business following a difficult 2004.
Whilst beverage can volumes were lower than last year, the past six months saw
better demand especially in the carbonated soft drinks sector.
Beverage container closures enjoyed good demand from growth in the carbonated
soft drink and sports drink markets. Sales of closures for baby foods also
experienced strong demand.
Sales of fish cans, which were affected by lower catches in the first half of
the year, showed some recovery in the second half whilst demand for fruit and
vegetable cans was in line with last year. Aluminium aerosol cans benefited from
buoyant consumer spending and ongoing substitution of tinplate cans. Paint can
sales volumes also grew but not to the same extent as paint sales, with much of
the increased demand being for paint packaged in plastic containers.
The Kenyan business performed well following increased demand for fruit cans but
the Zimbabwean business was affected by raw material shortages as a result of a
lack of foreign currency.
The glass bottle business recovered from a difficult 2004 and achieved better
manufacturing efficiencies albeit not yet at acceptable levels. The involvement
of Wiegand-Glas, who have acquired 50% of the business, is expected to result in
an improvement in factory output which will assist in meeting growing market
demand.
Paper
Rm Profit from Operating
Revenue Operations margin %
2005 2004 2005 2004 2005 2004
Africa 4 745 5 473 222 348 4.7 6.4
Europe 2 585 2 815 (132) 85 (5.1) 3.0
Total 7 330 8 288 90 433 1.2 5.2
Africa
Profits from this segment were lower due mainly to reduced contributions from
the corrugated container, cartons and labels and toilet tissue businesses.
A reduction in demand from the agricultural sector, due to drought in the
Western Cape and increased overcapacity in the corrugated container industry
resulted in lower margins. Substantial restructuring was undertaken and together
with investment in new printing technology, an improved performance is expected
in 2006.
Good growth was achieved in detergent cartons, bag-in-the-box containers and
labels whilst tobacco packaging suffered from reduced exports and lower demand.
Demand for folding cartons was also affected by reduced direct and indirect
exports and lower off-take from customers in the confectionery sector. Factory
rationalisation that will be completed in the first quarter of 2006 will result
in lower costs and better capacity utilisation in the year ahead.
The Nigerian cartons operation, which was established in a temporary facility in
record time, performed well.
Paper sacks benefited from strong cement sales as a result of increased activity
in the construction industry. Depressed conditions in the local textile industry
resulted in lower demand for cores and tubes.
Sales volumes of two-ply toilet tissue and diapers were well ahead of last year,
and although there was also strong demand for one-ply toilet tissue, there was
intense pressure on selling prices. The tissue-converting operation in Mobeni,
Durban was closed and will result in cost-savings in the year ahead.
Europe
The folding carton market in the United Kingdom remained highly competitive,
characterised by pressure on selling prices and loss of business as a result of
the relocation of some customers out of the United Kingdom. Two factories were
closed, one in Leicester and the other in Leeds. The major equipment upgrade at
the Cockburn Fields, Leeds factory was completed. Restructuring costs of some
R45 million were incurred and a loss was recorded for the year. Goodwill of R123
million was written off as a result of valuing the business at fair value.
The operations on the Continent continued to perform well.
In the Healthcare sector, some market share was gained but the highly
competitive environment resulted in a squeeze on margins which is likely to
continue in the year ahead.
Plastics
Rm Profit from Operating
Revenue Operations margin %
2005 2004 2005 2004 2005 2004
Africa 2 685 2 678 188 265 7.0 9.9
Europe 1 074 1 848 293 (35) 27.3 (1.9)
Total 3 759 4 526 481 230 12.8 5.1
Africa
The decline in profitability of this segment was due to the extremely difficult
conditions in flexible packaging markets.
Shopping bag sales suffered from low-priced imports whilst the films market
remained highly competitive. Higher value flexible packaging sales were affected
by imports of packaging and consumer goods which reduced demand from local
customers. Exports were also lower as a result of the strong rand and punitive
import duties in Nigeria.
Buoyant demand in South Africa for both carbonated soft drinks and juice
resulted in substantial growth of PET bottles. Sales volumes of high density
plastic bottles for milk and juice exceeded last year. Higher polymer raw
material costs could not, in all instances, be fully recovered.
Demand for toothpaste tubes was affected by the importation of filled product,
whilst tubs, for a variety of foodstuff, showed good growth. The strong demand
for beverages led to higher sales of plastic crates. Large drum sales were
better than last year.
Europe
The Short Run plastics business was disposed of, effective 30 October 2004.
The plastic milk bottle business acquired two in-plant operations with long-term
supply contracts thereby strengthening its position as the leading supplier to
the United Kingdom dairy industry. The Littleborough factory was closed and the
capacity relocated to other operations. Profitability, which was enhanced
through the sale of the Woburn Sands property, was however affected by a lag in
recovering polymer prices.
Group services
Rm Profit from
Revenue operations
2005 2004 2005 2004
Africa 51 111
Europe 172 218 69 44
Intergroup eliminations (199) (457)
Total (27) (239) 120 155
Group services comprise corporate functions, procurement, treasury and property
rentals. Head office costs, both in South Africa and Europe, were reduced as
part of a cost-reduction programme.
Africa
The decline in profits was due to an increase in the amortisation of the ERP
system and the inclusion in 2004 of a refund from the Malbak disability fund.
Europe
Profits were impacted by the transfer of the costs relating to the Cartons head
office to Group services, which were previously included in the operating
results. This was offset by a curtailment gain on restructuring the defined
benefit pension fund.
ACCOUNTING POLICIES
The group prepares its annual financial statements in accordance with South
African Statements of Generally Accepted Accounting Practice. The principal
accounting policies have been applied consistently with the previous year except
for the changes set out below.
IFRS3 Business Combinations was adopted by the group in the previous financial
year. In terms of this standard, with effect from 1 October 2004, the accounting
for previously recognised goodwill has changed. All accumulated amortisation has
been set off against the cost of goodwill and the revised carrying amount is no
longer amortised. Negative goodwill is no longer recognised on the balance sheet
and the carrying amount of R68 million has been taken directly to accumulated
profits. In conjunction with IAS36 Impairment of Assets, the methodology
adopted to test the carrying amount of goodwill for impairment has also changed.
Previously the group tested goodwill for impairment on a total acquisition
basis. The standard now requires that goodwill be allocated and tested for
impairment on a cash generating unit basis. Applying this basis, the goodwill
allocated to the Cartons UK and Ireland businesses has been fully impaired by
R123 million.
The group elected to early adopt IAS21 The Effects of Changes in Foreign
Exchange Rates as this standard has a direct impact on the accounting treatment
for goodwill following the adoption of IFRS3 Business Combinations. Goodwill,
previously denominated in rand that relates to acquisitions whose functional
currency is not rand denominated has been restated to these respective
functional currencies and translated at the closing rate. The impact on the
balance sheet has been a reduction in the carrying amount of goodwill of R150
million and a similar reduction in the foreign currency translation reserve in
equity.
AUDITED RESULTS
The consolidated financial statements for the year have been audited by Deloitte
& Touche and the accompanying unqualified audit report as well as their
unqualified audit report on this set of summarised financial information is
available for inspection at the registered office of the company. The annual
report will be posted to shareholders in December.
DIRECTORATE
Mr RP Becker resigned on 31 May 2005.
Mr AM Marthinusen retired on 31 July 2005 and Mr BP Connellan resigned on 28
September 2005.
Messrs TN Jacobs and RJ Khoza were appointed directors, effective 1 October
2005.
PROSPECTS
In South Africa the recent improvement in spending on non-durable goods is
expected to continue in the coming year and together with a more stable rand
should benefit Nampak"s sales. This, together with the lower cost base and
improved outlook for the paper and flexible packaging businesses, is expected to
result in an improvement in operating performance in the coming year.
In the rest of Africa, the Nigerian cartons operation is budgeted to contribute
significantly to profits in the region.
In Europe, a turnaround in the United Kingdom folding cartons business is
expected to result in a substantial improvement in trading profit.
The group expects to deliver a solid improvement in headline earnings in 2006.
DECLARATION OF ORDINARY DIVIDEND NO.74
Notice is hereby given that a final dividend No.74 of 56.6 cents per share
(2004: 56.6 cents) has been declared in respect of the year ended 30 September
2005, payable to shareholders recorded as such in the register at the close of
business on the record date, Friday 13 January 2006, making a total distribution
for the year of 83.6 cents (2004: 83.6 cents). The last day to trade to
participate in the dividend is Friday 6 January 2006. Shares will commence
trading "ex" dividend from Monday 9 January 2006.
The important dates pertaining to this dividend are as follows:
Last day to trade ordinary shares "cum" Friday 6 January 2006
dividend
Ordinary shares trade "ex" dividend Monday 9 January 2006
Record date Friday 13 January 2006
Payment date Monday 16 January 2006
Ordinary share certificates may not be dematerialised or re-materialised between
Monday 9 January 2006 and Friday 13 January 2006, both days inclusive.
On behalf of the board
T Evans G E Bortolan Sandton
Chairman Chief executive officer 23 November 2005
Non-executive directors:
T Evans (Chairman), PL Campbell*, DA Hawton*, MM Katz*, RJ Khoza, KM Mokoape*,
ML Ndlovu*, MH Visser, RA Williams*
*Independent
Executive directors:
GE Bortolan (Chief executive officer), N Cumming, TN Jacobs, AS Lang (British)
Secretary: NP O"Brien
Registered office:
Nampak Centre, 114 Dennis Road
Atholl Gardens, Sandton 2196
South Africa
(PO Box 784324, Sandton 2146
South Africa)
Telephone: +27 11 719 6300
Share registrar:
Computershare Investor
Services 2004 (Pty) Limited
70 Marshall Street
Johannesburg 2001, South Africa
(PO Box 61051, Marshalltown 2107
South Africa)
Telephone: +27 11 370 5000
Sponsor:
UBS South Africa (Pty) Limited
These results and a presentation to analysts and shareholders are available on
the group"s website.
Supplementary information
Operating AC 133 fair
profit as value
reported Abnormal Items adjustments
2005 2004 2005 2004 2005 2004
Rm Rm Rm Rm Rm Rm
Metals and 665 562 (16) 11 (2) (31)
Glass
Africa
Paper
Africa 222 348 57 49 11 (28)
Europe (132) 85 195 22 - -
Plastics
Africa 188 265 8 (4) 2 (9)
Europe 293 (35) (221) 119 - -
NamITech - 253 - (213) - (2)
Africa
Group
services
Africa 51 111 (16) (5) (1) 1
Europe 69 44 (66) - - (2)
Total 1 356 1 633 (59) (21) 10 (71)
Operating Margins
FEC costs profit before before
on plant and abnormal abnormal
equipment items items
2005 2004 2005 2004 2005 2004
Rm Rm Rm Rm % %
Metals and - 19 647 561 14 12
Glass
Africa
Paper
Africa - 1 290 370 6 7
Europe - - 63 107 2 4
Plastics
Africa 1 1 199 253 7 9
Europe - - 72 84 7 5
NamITech - - - 38 - 12
Africa
Group
services
Africa - - 34 107
Europe - - 3 42
Total 1 21 1 308 1 562 8 9
Basis of calculation
Abnormal items are defined as items of income and expenditure which do not arise
from normal trading activities or are of such a size, nature or incidence that
their disclosure is relevant to explain the performance for the year.
The fair value adjustments under AC 133 are all calculated using the "mark-to-
market" methodology.
Forward exchange contract costs on fixed assets are calculated as the difference
between the spot rate on the date risks and rewards of ownership on the
underlying transaction pass and the forward rate per the financial instrument.
Date: 23/11/2005 02:20:49 PM Produced by the JSE SENS Department
