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PSV
PSV
PSV Holdings Limited- Reviewed interim results: six months ended 31 August 2006
PSV Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 1998/004365/06)
Share Code: PSV
ISIN Code: ZAE000078705
Reviewed interim results: six months ended 31 August 2006
BALANCE SHEETS
Reviewed Reviewed Audited
31-Aug- 31-Aug- 28-Feb-
06 05 06
R"000 R"000 R"000
ASSETS
Non current assets 154,426 8
Fixed Assets 12,645 8
Long term Loans receivable 1,561
Specific intangibles 29,699
Goodwill 110,522
Current Assets 105,353 95 130
Inventories 37,823
Accounts Receivable 52,169 36 92
Cash Resources 15,361 59 38
Total Assets 259,779 103 130
EQUITY AND LIABILITIES
Equity 184,481 -518 -1084
Non current liabilities 11,044 -2
Long term liabilities 8,465
Deferred Tax 2,579 -2
Current Liabilities 64,254 623 1214
Accounts payable 46,908 623 1214
Receiver of Revenue 11,390
Bank overdrafts 5,957
Total equity and liabilities 259,779 103 130
Net asset value per share 88.36 -0.23
(cents)
INCOME STATEMENTS
Reviewed Reviewed Audited
31-Aug-06 31-Aug-05 28-Feb-06
R"000 R"000 R"000
Revenue 12,825 10 9
Operating expenses -23,943 -159 -725
Earnings before tax 16,979 -149 -716
depreciation and amortisation
Interest paid 837
Depreciation 3,210
Earnings before exceptional 12,932 -149 -716
items
Exceptional items -1623
Profit before taxation 12,932 -1772 -716
Taxation 4,051 1
Profit after tax for the period 8,881 -1772 -717
Basic and diluted earnings per 4.21 -0.79 -3.21
share (cents)
Basic and diluted earnings per 5.13
share excluding IFRS
amortisation and deemed
interest (cents)
Weighted average number of 211,108 223,128 223,128
shares ("000)
Headline earnings per share 4.21 -0.07 -3.3
(cents)
Headline earnings per share 5.13
excluding IFRS amortization and
deemed interest (cents)
Reviewed Reviewed Audited
31-Aug-06 31-Aug-05 28-Feb-06
R"000 R"000 R"000
CASH FLOW STATEMENTS
Cash flow from operating 3,869 -1047 -17
activities
Cash flow from investing -29,874 1035 -16
activities
Cash fow from financing 35,371
activities
Net movement in cash and cash 9,366 -12 -33
equivalents
Cash and cash equivalents at 38 71 71
beginning of year
cash and cash equivalents at 9,404 59 38
end of period
STATEMENT OF CHANGES IN EQUITY
Share Share Reva- Accumu- Stated Total
luation lated
Capital Premium Reserve loss Capital
Balance at 28 2231 93911 -98208 -2065
February 2005
Disposal of - - 1698 1698
subsidiaries -717
Net profit for the - - -717
year
Accumulated reserves
of
PSV/Thuthuka/Umzantsi
at 28 February 2006
Balance at 28 2,231 93,912 - -97,227 - -1,084
February 2006
Conversion of share -2,231 -93,912 - - 96,143 -
capital/premium to
stated capital
Issue of share - - - - 138,564 138,564
capital to vendors
Issue of share - - - - 43,950 43,950
capital for cash
Net buy back of - - - - -2,909 -2,909
shares
Listing fees taken to - - - - -2,822 -2,822
stated capital
Net profit for the - - - 8,882 - 9
year
Forex translation -100 - -100
reserve - PSV Zambia
Balance at 31 August - - -100 - 272,927 184,481
2006 88,346
COMMENTS
The Board of Directors is pleased to
present the reviewed interim financial
results of the Group for the six months
ended 31 August 2006 ("the interim
period").
NATURE OF THE BUSINESS
PSV Holdings was successfully listed on the
Alternative Exchange of the JSE ("ALTX") on
21 April 2006 and has two main operating
business units namely Engineering and
Petrochemical.
HIGHLIGHTS
During the period under review, the Group
generated an after tax profit of R 8,882
million (R 10,829 million before IFRS
adjustments) compared to a pro forma
aggregated after tax profit of R 13,554
million for the entire twelve months of the
previous year. The headline earnings per
share ("HEPS") excluding IFRS amortization
and deemed interest for the six month
period was 5.13 cents per share. Net asset
value per share increased to 88.4 cents per
share.
BUSINESS REVIEW
The company generated gross profits of R
41, 596 million at margins of 36, 8% and
operating margins in line with forecasts of
12,2 %. The period was characterized by
below average petrochemical company spend
resulting in turnover being 15% below
budget. However, due to the variability of
our infrastructural overhead, increasingly
vigilant cost containment and a superior
performance from our engineering unit, we
managed to preserve margins.
FINANCIAL REVIEW
With effect 1 March 2006, the Group
reversed into the Elexir Technology
Holdings Limited shell and raised R 43, 95
million to fund acquisitions and working
capital. The prior year comparatives
therefore serve no purpose and have been
inserted for illustrative purposes only.
During the course of the period, the
company repurchased 4,657 million shares
equivalent to 2,37% of the total issued
share capital at an average price of 62
cents per share. These shares are currently
being held as treasury shares. The Board"s
view is that the company"s share price is
intrinsically undervalued and it will
continue to repurchase shares in the open
market at undervalued share price levels.
In addition, the Board has identified many
shareholders holding less than 100 shares
due to the reverse listing. In order to
strengthen the company"s equity base and
reduce the price to volume volatility in
the share, the company will shortly embark
on an odd lot offer.
On an operational level, the company has
performed in line with budgetary
expectations. Historically, the company"s
trading cycles have been cyclical with an
emphasis on increased profitability in the
second part of the year.
INTERNATIONAL FINANCIAL REPORTING STANDARDS
("IFRS") ADJUSTMENTS
Due to the recent acquisitions made by the
company, it"s after tax earnings have been
materially impacted by the amortization of
specific intangibles and the unwinding of
discounts arising on deferred purchase
considerations still due to vendors. It is
estimated that the impact of these
adjustments will amount to approximately R
4 million on an after tax basis for the
year ended 28 February 2007. The impact of
these adjustments were not reflected in our
income projections disclosed in our Revised
Listing Particulars document issued on 10
March 2006.
PROSPECTS
The company"s prospects for the remainder
of the year look positive and it is
confident in closing several major
contracts in the second half of the
financial year which should enable the
group to maintain current profitability
levels.
The company remains confident of achieving
its forecast HEPS of 11,66 cents per share
for the year to 28 February 2007, however,
as indicated above this would be before the
IFRS adjustments relating to the
amortisation of specific intangibles and
deemed interest on the deferred purchase
considerations. The HEPS for the year to 28
February 2007 after these IFRS adjustments
would therefore be 9.82 cents per share.
ACCOUNTING POLICIES
The accounting policies used in the
preparation of these interim results are
consistent with those applied in the
previous period and in accordance with
IFRS, the Listings Requirements of the JSE
Limited as well as the Companies Act 61 of
1973, as amended. The interim report has
been prepared in accordance with IAS 34:
Interim Financial Reporting
Earnings per share was calculated in
accordance with IAS 33: Earnings Per Share
and IFRS 3: Business Combinations. Headline
earnings per share was calculated in
accordance with Circular 7/2002 issued by
SAICA. The ordinary shares in issue were
weighted in the calculation for the effect
of the general repurchase of shares.
CORPORATE GOVERNANCE
The group subscribes to the principles, and
implements where applicable, the
recommendations of the King II Code on
Corporate Governance.
DIRECTORATE
Mr E Ganhao resigned as an executive
director with effect from 1 September 2006.
DIVIDENDS
The group will continue to retain and
utilize cash generated to fund working
capital requirements and potential
acquisitions. The Board will review the
dividend policy annually.
REVIEWED OPINION BY THE INDEPENDENT
AUDITORS
The results have been reviewed by KPMG. The
unqualified review report is available for
inspection at the company"s registered
office.
For and on behalf of the Board
AR DREISENSTOCK
Financial Director
Johannesburg
30 October 2006
Registered office:
251 Albert Amon Rd, Millenium Office Park
Meadowdale Germiston
Transfer secretaries: Computershare
Investor Services 2004 (Pty) Limited,
Ground Floor, 70 Marshall Street,
Johannesburg 2001 (PO Box 61051,
Johannesburg, 2001)
Designated Adviser: Exchange Sponsors (Pty)
Ltd
39 First Road, Hydepark, 2196 (PO Box
411216, Craighall, 2024)
Directors
J.J.H Mateya**+,A.J.D. Da Silva, AR.
Dreisenstock, V. Hall , D. Kelly*, R.
Lubbinge,
P. Robinson*, G.J.V. Shongwe**
* British, **+ Chairman, ** Non Executive
Date: 30/10/2006 07:00:16 AM Produced by the JSE SENS Department
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