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OLG
OLG
OneLogix - Unaudited Interim Results For The Six Months Ended 30 November 2005
OneLogix Group Limited
(Registration number 1998/004519/06)
Share code OLG
ISIN: ZAE000026399
("OneLogix" or "the group")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 NOVEMBER 2005
("the interim period")
* REVENUE UP 98%
* OPERATING PROFIT UP 33%
* HEPS UP 52%
Condensed Consolidated Income Statement
Unaudited Unaudited Unaudited*
Six months Six months Year
ended ended ended
30 November 30 November 31 May
2005 2004 2005
R"000 R"000 R"000
Revenue 80 356 40 663 106 142
Operating and administration
costs 67 736 30 540 84 276
Depreciation 2 286 2 335 4 450
Operating profit 10 334 7 788 17 416
Share of associate loss - 154 156
Finance costs 842 401 938
Profit before taxation 9 492 7 233 16 322
Taxation 1 635 2 233 2 566
Net profit 7 857 5 000 13 756
Attributable to:
- Minority interest 338 - 326
- Equity holders of the company 7 519 5 000 13 430
Net profit 7 857 5 000 13 756
Number of shares in issue ("000)
- Total 197 273 192 113 192 780
- Weighted 197 273 196 606 196 940
Basic and headline earnings
per share (cents)
- Basic and fully diluted 3.8 2.5 6.8
OTHER FINANCIAL INFORMATION
SEGMENTAL ANALYSIS
Revenue
Logistics 71 272 33 008 90 629
Services 9 084 7 655 15 513
80 356 40 663 106 142
Operating profit
Logistics 11 119 7 389 17 109
Services 2 332 1 932 4 187
Corporate (3 117) (1 533) (3 880)
10 334 7 788 17 416
COMMITMENTS
Operating lease commitments
(not exceeding
five years) 1 569 3 030 1 914
The group has authorised capital expenditure over the next 12 months of
R18 million. R15 million of the capital expenditure has been committed to
aquiring properties which will be developed for future income generating
vehicle storage.
*The audited results for the 12 months ended 31 May 2005 under SA GAAP have
been restated as unaudited due to the IFRS adjustments not having been audited
by the external auditors.
Condensed Consolidated Cash Flow Statement
Unaudited Unaudited Unaudited*
Six months Six months Year
ended ended ended
30 November 30 November 31 May
2005 2004 2005
R"000 R"000 R"000
Net cash generated
from operations 9 635 5 313 11 517
Net cash flows from
investing activities (10 373) (9 223) (19 427)
Net cash flows from
financing activities 5 497 2 343 7 097
Net increase/(decrease) in cash
resources 4 759 (1 567) (813)
Cash resources at beginning of period 6 070 6 883 6 883
Cash resources at end of period 10 829 5 316 6 070
Condensed Consolidated Balance Sheet
Unaudited Unaudited Unaudited*
at at at
30 November 30 November 31 May
2005 2004 2005
R"000 R"000 R"000
ASSETS
Non-current assets 58 826 42 693 50 677
Property, plant and equipment 38 940 23 425 31 502
Intangible assets 19 175 18 977 19 175
Interest in associate - 291 -
Loans and receivables 711 - -
Current assets 38 552 17 707 27 180
Inventories 1 864 1 177 1 875
Trade and other receivables 25 859 11 214 19 235
Cash resources 10 829 5 316 6 070
Total assets 97 378 60 400 77 857
EQUITY AND LIABILITIES
Equity 53 157 36 447 45 518
Ordinary shareholders" funds 52 461 36 447 45 077
Minority interests 696 - 441
Liabilities
Non-current liabilities 19 937 10 485 14 073
Interest-bearing borrowings 14 936 7 049 10 708
Deferred tax 5 001 3 436 3 365
Current liabilities 24 284 13 468 18 266
Trade and other payables 18 200 9 821 13 439
Interest-bearing borrowings 6 069 3 492 4 578
Taxation 15 155 249
Total equity and liabilities 97 378 60 400 77 857
Net asset value per share (cents) 26.6 19.0 23.4
Net tangible asset
value per share (cents) 16.9 9.1 13.4
Condensed Consolidated Statement of Changes in Equity
Share Share Retained Minority
capital premium income interests Total
R"000 R"000 R"000 R"000 R"000
At 1 June 2004
- unaudited 1 921 31 871 (2 945) - 30 847
New shares issued
less expenses 45 555 - - 600
Net profit - - 5 000 - 5 000
At 30 November 2004
- unaudited 1 966 32 426 2 055 - 36 447
New shares issued
less expenses 7 193 - - 200
Minority loans - - - 115 115
Net profit - - 8 430 326 8 756
At 31 May 2005
- unaudited 1 973 32 619 10 485 441 45 518
Share issue expenses - (135) - - (135)
Minority loans - - - (83) (83)
Net profit - - 7 519 338 7 857
At 30 November 2005 1 973 32 484 18 004 696 53 157
Transition to International Financial Reporting Standards
Reconciliation of previous SA GAAP and IFRS
At At At
1 June 30 November 1 June
2005 2004 2004
Reconciliation of equity Notes R"000 R"000 R"000
As reported under SA GAAP 40 448 30 553 26 503
Adjusted for:
Fair value adjustment
to property,
plant and equipment 2 6 462 6 462 6 462
Depreciation 4 335 (44) -
Reversal of
goodwill amortisation 5 - 1 557 -
Leases 6 (278) (310) (343)
Deferred taxation (1 890) (1 771) (1 775)
As reported under IFRS 45 077 36 447 30 847
Six months Year
ended ended
30 November 31 May
2004 2005
Reconciliation of net profit R"000 R"000
As reported under SA GAAP 3 450 13 471
Adjusted for:
Depreciation 4 (44) 335
Reversal of
goodwill amortisation 5 1 557 -
Leases 6 33 66
Taxation 4 (116)
As reported under IFRS 5 000 13 756
COMMENTS
Basis of presentation, accounting policies and notes
The results for the interim period and comparative information have been
prepared in terms of International Financial Reporting Standards ("IFRS")
expected to be applicable at 31 May 2006 and comply with IAS 34 - Interim
Financial Reporting and relevant sections of the Companies Act in South
Africa.
The OneLogix transition date is 1 June 2004 ("the transition date"). The
annual financial statements for the year ending 31 May 2006 will be the
group"s first consolidated IFRS - compliant annual financial statements. The
disclosures required by IFRS- 1 First-time Adoption of International Financial
Reporting Standards concerning the transition from South African Statements of
Generally Accepted Accounting Practice ("SA GAAP") to IFRS and the required
changes in accounting policies are presented under the heading "Transition to
International Financial Reporting Standards - Reconciliation of previous SA
GAAP and IFRS".
IFRS 1 - First-time Adoption of IFRS
At the transition date, IFRS allows a number of exemptions to the
retrospective application principle. The group has elected the following
exemptions available under IFRS 1:
1. Business Combinations: The group adopted IFRS 3 - Business Combinations,
from 1 June 2004 and accordingly no adjustments were required;
2. Property, Plant and Equipment: As a first-time adopter the group elected to
fair value its fleet of vehicles and trailers. The effect of the adjustment is
disclosed under "Reconciliation of equity";
3. Share-based Payments: The group has elected to apply the share-based
payments exemption. It applied IFRS 2 - Share-based Payments from 1 June 2004
to those options that were issued after 7 November 2002 but which had not
vested by 1 January 2005. No options were issued during this period and hence
no charge was incurred;
Other adjustments as a result of the adoption of IFRS
The impact of other adjustments as a result of adopting IFRS is summarised
below. The quantification of the adjustments is shown in the reconciliation of
equity and net profit.
4. Where parts of an item of property, plant and equipment have different
useful lives, they are accounted for as separate items of property, plant and
equipment. Residual values and useful lives of all assets are reassessed
annually. This more robust assessment has resulted in an increase in estimated
useful lives of property, plant and equipment, and accordingly the
depreciation charged to the income statement has reduced for the year ended 31
May 2005 and the interim period ended 30 November 2005;
5. Goodwill, which was previously amortised, is tested annually for impairment
and carried at cost less accumulated impairment losses; and
6. Operating lease charges are now accounted for on a straight-line basis.
Previously operating lease charges were expensed on a cash flow basis as
incurred. This has resulted in higher lease costs in previously reported
periods and a reduction of lease costs in the year ended 31 May 2005 and the
interim period ended 30 November 2005.
Review of Operations
The group"s businesses continued to perform well across the board:
Vehicle Delivery Services ("VDS") continued to dominate a buoyant cross-border
auto-logistics market. Historical investment in fleet expansion, vehicle
tracking software and IT systems, supported by high levels of efficiency
within the business, have now entrenched VDS as a local market operator as
well. The group will continue to invest major capital expenditure in VDS over
the next 12 months to meet the demand for increased vehicle carrier capacity
in the auto-logistics market.
Media Express ("ME") has retained a sizeable market share in the niche market
of express media delivery, which is characterised by customer price-
sensitivity. Margins therefore remained under pressure during the interim
period. With profitable associated niche markets identified by the group and
strengthened management, an improved performance is expected from ME in the
period ahead.
4 Logix and Gijima are established suppliers in the local and export bulk
commodity logistics market. The businesses" solid performances during the
period were boosted by long-term contracts and skilled management.
PostNet"s strong brand has been successfully revitalised as a result of an
intensive brand re-engineering process. The business" entrenched position as
a leading supplier of business service solutions has positioned PostNet to
benefit from the rapid growth in the SMME market.
BEE
On 22 November 2005, the group"s shareholders ratified a BEE transaction
whereby 25% of the group"s wholly-owned operating subsidiary was acquired by a
consortium led by Sipho Pityana"s Izingwe Capital (Pty) Ltd ("Izingwe") and
including the group"s BEE Staff Trust. Details of the BEE transaction were
disclosed in an announcement dated 30 August 2005.
Had the transaction been completed on 1 June 2005, an approximate 15% dilution
in earnings would have occurred. However, this dilution does not take into
account additional earnings generated as a result of an enhanced BEE platform.
Financial Results
Revenue for the group increased by 98% to R80 million from R41 million.
Operating profit grew by 33% to R10,3 million, representing approximately
12,5% of revenue. Headline earnings per share ("HEPS") rose by 52% from 2,5
cents per share to 3,8 cents per share.
The increase in revenue can be attributed largely to the consolidation of
4Logix with effect from 1 December 2004, as well as the higher revenue
generated by VDS on its successful entry into the local market.
Notwithstanding the growth in revenue, debtors days have remained consistent
with the previous period.
Operating profit included a once-off cost of approximately R0,75 million
relating to the implementation of the group"s BEE transaction.
The taxation charge of R1,6 million was reduced by learnership allowances
totalling R1,1 million.
Despite the increased working capital requirements commensurate with growth in
revenue, cash generated from operations increased from R5,3 million to
R9,6 million which again underpinned headline earnings. The group invested a
total of R9,7 million in infrastructure, mainly in VDS. Infrastructure spend
was financed by cash generated from operations and a R5,5 million increase
in interest-bearing borrowings.
Prospects
On balance revenue is historically weighted to the first half of the financial
year. However, the outlook for the balance of the current financial year
remains good. Notwithstanding the dilution in earnings resulting from the BEE
transaction (see `BEE" above), the directors are confident that the group will
show real growth in HEPS for the year to 31 May 2006.
People
Following the successful conclusion of the BEE transaction, we are pleased to
welcome to the board representatives of Izingwe - Sipho Pityana has been
appointed the non-executive Chairman replacing Andrew Brooking, and Tsakani
Matshazi has been appointed a non-executive director of the group. We thank
Andrew for his invaluable contribution and are particularly pleased that he
will remain on the board in a non-executive capacity.
OneLogix thanks its management, employees, business partners, customers,
suppliers, business advisors and shareholders for their ongoing support.
By order of the board
Ian Lourens (CEO) Cameron McCulloch (Financial Director)
24 February 2006
Warning: The listing of the ordinary shares in the company is on AltX.
Shareholders are advised of the risks of investing in a company listed on
AltX. Shareholders are advised that the JSE Limited ("JSE") does not guarantee
the viability or the success of a company listed on AltX. In terms of the JSE
Listings Requirements a designated advisor has to be retained by the company.
The designated advisor is required to, inter alia, attend all board meetings
held by the company to ensure that all JSE Listings Requirements and applicable
regulations are complied with, approve the financial director of the company
and guide the company in a competent, professional and impartial manner. If
the company fails to retain the designated advisor it must make arrangements
to appoint a new designated advisor within 10 business days, failing which the
company faces suspension of trading of its securities. If a designated advisor
is not appointed within 30 days of its suspension the company faces the
termination of its listing without an offer to minority shareholders.
Directors: S M Pityana (Chairman)*, N J Bester, A C Brooking*, A J Grant*#,
I K Lourens (Chief Executive Officer), T Matshazi*, C V McCulloch
(Financial Director), J G Modibane*#
*Non-executive director #Independent director
Company secretary: Probity Business Services (Proprietary) Limited, Suite 204,
20 Baker Street, Rosebank, 2196 (PO Box 85392, Emmarentia, 2029)
Registered office: 46 Tulbagh Road, Pomona, Kempton Park (PO Box 85392,
Emmarentia, 2029)
Transfer secretaries: Computershare Investor Services 2004 (Proprietary)
Limited, Ground Floor, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051,
Marshalltown, 2107)
Date: 24/02/2006 01:37:17 PM Produced by the JSE SENS Department
