| Tue 19 Sep 2006, 14:56 | | Gooderson Leisure Corporation Limited - Abridged P |
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JSE
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Gooderson Leisure Corporation Limited - Abridged Prospectus
This abridged prospectus is not an invitation to the public to subscribe for
shares in Gooderson, but is issued in compliance with the Listings Requirements
of the JSE for information purposes only. The information in this abridged
prospectus has been extracted from a full prospectus issued by Gooderson on 19
September 2006 ("the detailed prospectus"), which is available as set in
paragraph 8. At the date of listing the authorised share capital of Gooderson
comprises 500 000 000 million ordinary shares with a par value of 0.001 cent
each, of which, after a private placement of 20 million ordinary shares at 85
cents per share ("the placement"), 120 million shares will be in issue.
Gooderson Leisure Corporation Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1972/004241/06)
(JSE code: GDN & ISIN: ZAE000084984)
("Gooderson" or "the company")
ABRIDGED PROSPECTUS
Listing of Gooderson ordinary shares ("shares") on JSE Limited ("the JSE").
1. INCORPORATION AND HISTORY
Date of incorporation: 24 April 1972
1.1 The Gooderson Leisure Corporation was established in 1957, when Mr R H
Gooderson acquired the first of his hotels in Durban; the Lonsdale
Hotel, one block from the beachfront. Through the acquisition of a
number of hotels, the company grew from one hotel to thirteen hotels
in 1970. The company listed on the Johannesburg Stock Exchange in
1968 as Gooderson Hotels Limited (`Goodtel"). When Alan Gooderson
purchased the business from his family in 1972, he pursued a new
strategy, which included delisting from the Johannesburg Stock
Exchange, the sale of non-profitable hotels and entering into the
timeshare industry.
1.2 The company entered into a partnership in the timeshare industry in
1981, which allowed its management team to gain extensive knowledge of
timeshare development, sales and management. The success that the
company achieved with the development, sale and management of
timeshare properties resulted in the establishment of Goodfin, which
offers finance to prospective timeshare owners.
1.3 Gooderson Vacation Sales (Pty) Ltd was formed in January 1996 to
handle the in-house marketing, sales and letting of all the self-
catering and timeshare properties. The ownership and management of
these units, along with the three hotels under management provided the
company with the infrastructure to not only survive the changing
demographics but to accommodate for tourists" demand for a variety of
holiday destinations.
1.4 In March 2006, the shareholders of Gooderson Leisure Corporation
(Limited) proposed a listing of Gooderson on the Alternative Exchange.
The company converted to a public company on 9 June 2006.
2. NATURE OF THE COMPANY"S BUSINESS AND INDUSTRY
2.1. Gooderson manages and provides accommodation, food and beverage and
restaurant services to leisure, international and conference tourists
in the KwaZulu-Natal province. The Gooderson family forms the
majority of the company"s directors, and are the major shareholders of
the company.
2.2. The company manages timeshare resorts and lodges that include "The
Fairways", "Riverbend Chalets" and "Mountain View" at Drakensberg
Gardens, the Silversands I, II, III in Durban, Mtunzini Chalets at
Mtunzini, on the north coast of KwaZulu-Natal, Bushlands Game Lodge
and DumaZulu Traditional Village & Lodge near Hluhluwe. The Tropicana
and Beach hotels in Durban and the Drakensberg Gardens and Natal Spa
Resorts provide three-star accommodation to the middle class and the
conference markets.
2.3 More than 87% of the company"s staff complement of 506 people are
black. Progress is being made in black representation in middle and
senior management to meet the requirements of the Tourism BEE Charter.
2.4. The company"s audited revenues of R 64.02 million for the year that
ended 28 February 2006 are derived from the management of the hotels,
lodges and timeshare resorts.
2.5. The company"s business can be divided into the following areas:
2.5.1 Hotel and Lodge management
The company"s core expertise is in the management of hotels,
lodges and self-catering establishments. The company"s
knowledge is also applied in the management and development
of its own resorts as well as other resorts that it manages
on behalf of third parties.
2.5.2 Timeshare Sales and management
This division of the company focuses on the management of
timeshare units. Services include the letting of owners"
units as well as the management of the timeshare resorts.
The company has also gained experience in the development
and sale of timeshare units. Resorts are identified for
acquisition, followed by the construction and/or renovation
of timeshare units. Units are sold with the management of
the various timeshare resorts contracted to the company.
2.5.3 Purchasers" Finance
Goodfin provides capital to prospective timeshare owners and
lent monies to date are in excess of R11 million.
2.5.4 Properties
The Group owns all its properties, with the exception of
one, this being the Beach Hotel in Durban, which is on a
lease basis. Ownership of the two lodges is a 50%
partnership between Gooderson Leisure Corporation Limited.
and Zululand Safaris CC the directors of which formed the
company Bushlands Game Lodge (Pty) Limited.
3. PROSPECTS
3.1. The company"s customers consist of tourists (local and international),
conference delegates, corporate clients and timeshare owners for which
the company manages the resorts. More than 70% of the beachfront
hotels" customers are black, with international tourists accounting
for the remaining 30% occupancy. The hotels have been exposed to the
growing middle class over the years, which resulted in a rise in
occupancy rates. The hotels" location and conference venues have
positioned the group ideally for the conferencing circuit. The hotels
also capitalize on their location and Kwa-Zulu Natal relations to host
a number of local government conferences.
3.2 There are several factors that have enabled South Africa"s tourism
industry to continue to grow, while the global tourist industry in
general has experienced tough times.
* South Africa has built up an image as a safe holiday destination
(not influenced by international terrorism, SARS or bird flu),
with government and industry leaders acting quickly to
counterbalance negative reports that may influence tourist
perceptions.
* South Africa still represents good value for money, with the
country ranked the world"s second most affordable destination
last year by American Express.
* South Africa has attractive tourism assets, including world-class
beaches that enjoy year-round sunshine, vibrant and culturally
diverse cities, game parks and other nature attractions.
Tourism in South Africa is expected to grow by almost 6% annually
for the next ten years, and currently contributes more than 9 %
to Gross Domestic Product.
3.3. The company has experienced an average growth rate in revenue of more
than 10% over the past three years. Its involvement in a number of
projects, locally and internationally will ensure that it achieves a
high revenue growth rate over the next three to five years.
4. SUMMARY OF HISTORICAL AND FORECAST INCOME STATEMENTS
The historical and forecast financial information of Gooderson and its
subsidiaries for the financial year ended 28 February 2006, years ending 28
February 2007 and 28 February 2008, the preparation of which is the
responsibility of the directors, are set out below. The forecast financial
information is contained in the detailed prospectus referred to in
paragraph 4.1 below and has been reviewed and reported upon by the
reporting accountants. Such report will be contained in the detailed
prospectus and will also be available for inspection.
4.1 Extracts from the historical and forecast income statements
Audited Forecast Forecast
Year ended 28 February 2006 2007 2008
R"000 R"000 R"000
Revenue 64 022 86 229 99 444
Gross profit 53 314 67 629 79 396
Other income - 1 571 1 458
Other net operating costs (38 040) (48 703) (55 057)
EBITDA 15 274 20 497 25 797
Depreciation (3 249) (3 154) (3 457)
Profit before interest and taxation 12 025 17 343 23 106
Net interest received / (paid) (402) 308 767
Profit before taxation 11 623 17 651 23 106
Taxation (3 096) (5 555) (7 215)
Earnings attributable to ordinary 8 527 12 096 15 891
shareholders
Pro forma weighted average shares in 100 100 000 108 493 150 120 000 000
issue
Pro forma earnings per share (cents) 8.53 11.15 13.24
Pro forma dividend per share (cents) 3.55 4.56
Notes:
(1) Pro forma calculation for 28 February 2006 is based on the
conversion of the original 200 shares in issue to 100 000 000 shares
at the last practical date.
(2) The assumptions upon which the forecast income statements are
based are set out in paragraph 11.2 of this prospectus.
(3) Other income in 2007 and 2008 is in respect of discounts,
administration, IT and project fees.
(4) Revenues are forecasted to grow 35% from 2006 to 2007. This
growth is driven by a combination of:
* Drakensberg Gardens: additional 20 rooms and the securing of
lucrative contract from corporate customers.
* The new acquisition, Natal Spa, as from 1 September 2006.
* Fairways timeshare resort: additional 12 units developed during
the current financial year.
* Beach and Tropicana Hotel: increase in room rates, while fixed
overheads increase at a lower rate.
5. DIRECTORS, COMPANY SECRETARY AND REGISTERED OFFICE
5.1 Full names, nationalities, ages, business addresses and functions of
the board of directors of Gooderson:
Director Age Occupation Business address
Alan Gooderson 69 Chairman / CEO 85 Marine Parade,
Durban, 4001
Cheryl Gooderson 47 Director / Chief 85 Marine Parade,
Operating Officer Durban, 4001
- Timeshare
Division
Colleen de Klerk 44 Director- 85 Marine Parade,
Timeshare Durban, 4001
Division
Rajen Nannoolal 42 Group Financial 85 Marine Parade,
Director Durban, 4001
Gavin Castleman 42 Operations 85 Marine Parade,
Director - Hotels Durban, 4001
& Lodges
Glynis Lello 46 Sales & Marketing 85 Marine Parade,
Director - Hotels Durban, 4001
& Lodges
Michael Allen 44 Non Executive Vke Centre, 21 West
Pottier Director Riding Row, Sherwood,
4091
Brian Reynold 64 Non Executive 7 Brampton, 30 Nqutu
Warmback Director Road, Hillcrest
3610
* Company secretary and registered office are:
Ragen Nannoolal
2nd Floor, 4 Pencarrow Crescent
La Lucia Ridge Office Estate
La Lucia, 4019
(PO Box 752, Durban, 4000)
Telephone: (031) 337 2672
Facsimile: (031) 337 2621
6. THE PLACEMENT
6.1 Salient features
6.1.1 The salient features of the private placement are
as follows:
Offer price per ordinary share 85
(cents)
Par value per ordinary share (cents) 0.001
Premium per ordinary share (cents) 84.999
Number of ordinary shares offered in 20 000 000
terms of private placement
Issue consideration before expenses R17 million
6.1.2 The opening and closing dates of the private placement are
as follows:
Opening date of the private placement Tuesday, 19
at 09:00 on September 2006
Closing date of private placement at Tuesday, 19
12:00 on September 2006
Anticipated listing date on ALTx on Tuesday, 26
September 2006
Safe custody accounts at CSDP or Tuesday, 26
broker updated in respect of September 2006
dematerialised shareholders on or
about
Posting of share certificates in Tuesday, 26
respect of certificated shareholders September 2006
on or about
Refund of surplus private placement Tuesday, 26
application monies received (where September 2006
applicable) on
Note:
These dates are subject to change at the discretion of the
company. Any changes will be released on SENS.
6.2 Gooderson holds irrevocable undertakings from various selected
investors to subscribe for 20 000 000 shares in terms of the private
placement, amounting to 100% of the private placement shares.
6.3 The private placement of 20 000 000 ordinary shares have been fully
allocated to the investors who have given irrevocable undertakings as
set out in paragraph 6.2 above.
6.4 The private placement is subject to a minimum subscription, sufficient
to meet the listing requirements of the JSE, being achieved.
7. LISTING ON THE JSE
Subject to the required spread of public shareholders in terms of the
Listings Requirements being obtained pursuant the private placement, the
JSE has granted Gooderson a listing in respect of 120 000 000 ordinary
shares on ALTx under the abbreviated name "Gooderson", share code "GDN" and
ISIN ZAE000084984, with effect from the commencement of business on
Tuesday, 26 September 2006.
8. COPIES OF THE PROSPECTUS
Copies of the prospectus, in English, may be obtained, during business
hours, prior to the closing of the private placement, from the trading
offices of Gooderson, Exchange Sponsors (Pty) Limited and the transfer
secretaries, details of which are set out below:
* the registered office of the company - 85 Marine Parade, Durban, 4001
* the offices of Exchange Sponsors (Pty) Limited - 39 First Road, Hyde
Park, 2196;
* the offices of Computershare Investor Services 2004 (Pty) Limited -
Ground Floor, 70 Marshall Street, Johannesburg, 2001;
* the web-site of Gooderson at www.goodersonleisure.co.za.
Johannesburg
19 September 2006
Designated Adviser
Exchange Sponsors (Pty) Limited
Auditors and reporting accountants
Grant Thornton
Attorneys
Cox Yeats Attorneys
www.goodersonleisure.co.za
Warning: The listing of ordinary shares in the company is on ALTx.
Investors are advised of the risks of investing in a company listed on
ALTx. Investors are advised that the JSE does not guarantee the viability
or the success of a company listed on ALTx. In terms of the Listings
Requirements, the company is obliged to appoint and retain a Designated
Adviser, which is required to, inter alia, attend all board meetings held
by the company to ensure that all the 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 a Designated Adviser, it must make
arrangements to appoint a new Designated Adviser within 10 business days,
failing which the company faces suspension of trading of its securities.
If a Designated Adviser is not appointed within 30 days of its suspension,
the company faces the termination of its listing without the prospect of an
appropriate offer to minority shareholders.
Date: 19/09/2006 02:56:09 PM Produced by the JSE SENS Department
