| Tue 7 Nov 2006, 9:32 | | New Corpcapital - Audited Results For The Year End |
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NCA
NCA
New Corpcapital - Audited Results For The Year Ended 31 August 2006
NEW CORPCAPITAL LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2001/006539/06)
Share code: NCA & ISIN: ZAE000067765
("New Corpcapital")
AUDITED RESULTS FOR THE YEAR ENDED 31 AUGUST 2006
CONSOLIDATED BALANCE SHEET
at 31 August 2006
2006 2005
Rm Rm
ASSETS
Non-current assets 65,1 162,9
Financial product assets - 45,0
Investments available for sale - 0,7
Associates - 47,7
Corpcapital Life policyholder 65,1 69,5
investments, interest bearing securities
and deposits
Current assets 255,8 636,9
Cash and cash equivalents 59,2 180,6
Trading securities and liquid assets 0,2 0,5
Advances and other accounts receivable 17,4 15,1
Financial product assets 45,0 232,1
Investments available for sale 15,3 24,6
Corpcapital Life policyholder 112,7 177,8
investments, interest bearing securities
and deposits
Taxation assets 6,0 6,2
Total assets 320,9 799,8
EQUITY AND LIABILITIES
Equity
Share capital and premium 214,8 254,7
Retained losses (130,5) (128,3)
Total shareholders" equity 84,3 126,4
Total liabilities 236,6 673,4
Non-current liabilities 68,3 114,6
Financial products liabilities - 45,0
Corpcapital Life policyholder liabilities 65,1 69,5
- investment contracts
Deferred taxation 3,2 0,1
Current liabilities 168,3 558,8
Short-term debt - 132,0
Trading liabilities 0,2 0,5
Accounts payable 10,9 14,9
Financial products liabilities 45,0 232,2
Corpcapital Life policyholder liabilities 111,8 177,8
- investment contracts
Taxation liabilities 0,4 1,4
Total equity and liabilities 320,9 799,8
Net asset value per share (cents) 22,2 33,3
Shares in issue (`000) 379,941 379,941
CONSOLIDATED INCOME STATEMENTS
for the year ended 31 August 2006
2006 2005
Rm Rm
Revenue 75,0 78,1
Net interest income 8,2 5,3
Interest received 52,9 61,3
Interest paid 44,7 56,0
Impairment of advances (4,3) 2,0
Non-interest income 22,1 16,8
Investing, trading and fee income 22,1 10,5
Equity accounted income - 6,3
Total income 26,0 24,1
Operating expenses 25,5 8,2
Goodwill amortisation - 1,4
Negative goodwill arising on acquisition of - 66,1
subsidiaries of Corpcapital Limited
Profit/(loss) before taxation 0,5 83,4
Taxation 2,7 1,9
Attributable (loss)/profit (2,2) 81,5
Basic (loss)/profit per ordinary share (0,6) 21,5
(cents)
Basic headline (loss)/profit per ordinary (0,6) 2,6
share (cents)
ANALYSIS OF HEADLINE EARNINGS ADJUSTMENTS
Attributable (loss)/profit (2,2) 81,5
Negative goodwill arising on purchase of - (66.1)
Corpcapital Limited (in liquidation) group
companies
Goodwill amortisation on associate - (1.4)
Profits on sale of associates - (4.2)
Headline (loss) / profits (2.2) 9.8
Basic headline (loss) / profit per share (0.6) 2.6
(cents)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 August 2006
2006 2005
Rm Rm
Total shareholders" equity at beginning of 126,4 202,1
year
Attributable (loss)/profit (2,2) 81,5
Distributions of capital to shareholders (39,9) (157,2)
Total shareholders" equity at end of year 84,3 126,4
CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 August 2006
2006 2005
Rm Rm
Operating activities (1,5) 57,6
Cash (utilised)/generated by operations (9,3) 52,7
Interest received 52,9 61,3
Interest paid (44,7) (56,0)
Taxation and dividends paid (0,4) (0,4)
Investing activities 56,6 11,0
Investments in associates and other 56,6 11,5
investments
Liquid and net trading assets - (0,5)
Proceeds on return of capital from - -
subsidiary
Financing activities (176,5) 83,9
Distribution of capital to shareholders (39,9) (157,2)
Interest bearing debt (136,6) (4,1)
Movements in loans receivable - 245,2
Net change in cash and cash equivalents (121,4) 152,5
Opening cash and cash equivalents 180,6 28,1
Closing cash and cash equivalents 59,2 180,6
BASIS OF PREPARATION
The group has adopted International Financial Reporting Standards
("IFRS") for the year ended 31 August 2006. The financial statements
for the year ended 31 August 2006 are the group"s first consolidated
IFRS compliant financial statements and hence IFRS 1 - First time
adoption of IFRS has been applied.
An explanation of how the transition to IFRS has affected the
previously reported financial position and performance of the group
is provided below.
Significant changes to the group"s accounting policies as a result
of the adoption of IFRS:
Revenue - IFRS requires that fees charged for managing investments
are recognised as revenue as the services are provided. The fee
income earned on the investment contracts were previously recognised
at the inception of the contracts. This income is now recognised on
a straight line basis over the term of the investment contract.
Transition to International Financial Reporting Standards (IFRS), in
preparing the opening IFRS balance sheet the group has adjusted
amounts previously reported under SA GAAP.
An explanation of how the transaction has affected the group"s
previously reported financial position and performance is set out in
the following table. The cash flow statement was not affected by any
of these changes.
Reconciliation of previous SA GAAP to IFRS:
31 August 1 September
2005 2004 Rm
Rm
Reconciliation of equity
Previously reported under SA GAAP 131.2 212.9
Adjustment for adoption of IFRS (4.8) (10.8)
Equity reported under IFRS 126.4 202.1
Effect of IFRS adjustments:
Retained income and reserves (4.8) (10.8)
Accounts payable and accruals 4.8 10.8
Reconciliation of `Net profit after
taxation"
Previously reported under SA GAAP 75.5
Effect of IFRS on "Investing, trading 6.0
and fee income"
Net profit after taxation (restated) 81.5
COMMENTARY
New Corpcapital was listed on the JSE Limited on 27 June 2005
following the liquidation of Corpcapital and the termination of its
listing. New Corpcapital was previously an unlisted wholly-owned
subsidiary of Corpcapital. Since Corpcapital"s liquidation, New
Corpcapital has owned and controlled its assets and discharged the
liabilities.
New Corpcapital has nearly completed the strategy, initiated by
Corpcapital, of realising group assets and returning capital to
shareholders. Remaining assets are reflected at fair value and
continue to be managed by the group. These include Corpcapital Life
Insurance Limited, which is a dormant life insurance company, and
the remnants of a debtors" book. The anticipated timing of further
capital distributions to shareholders depends on the realisation and
discharge of investment products issued some years ago by
Corpcapital Bank Limited and the life insurance company, the
collection of outstanding debts and the final resolution of
litigation. The last tranche of Corpcapital Life policyholder
investments matures in December 2007.
The group"s operations are regarded as discontinuing and the
accounting policies adopted for the financial year are consistent
with the previous year. The policies comply in all respects with
International Financial Reporting Standards.
Revenue for the year arises from interest earned on cash resources
and the higher than expected profit received from the disposal of an
investment in Forza Group Limited during the current financial year.
Long-term liabilities and corresponding assets reflected in the
financial statements arise from the last of the group"s investment
products. Overhead costs have been reduced in line with the limited
scope of activities and all onerous contracts have been settled. The
board remains committed to cost-effectively winding-up the remaining
operations.
As previously announced the Group has been involved in High Court
litigation proceedings during the year. The claims by and against
former director Nic Frangos were settled out of court on 30 May
2006. The costs incurred exceeded expectations. Corpcapital"s
application for an order directing the Minister of Trade & Industry
to release the report into Corpcapital"s affairs was granted on 24
August 2006. The costs of these proceedings were awarded in favour
of Corpcapital. The Minister has applied for leave to appeal against
the High Court judgment. These proceedings remain pending.
Consequently the inspectors" report has not been released.
New Corpcapital distributed 10,5 cents per share to shareholders on
31 October 2005 and a further 12 cents per share to shareholders on
27 September 2006. These payments to shareholders formed part of the
total amount to be returned to shareholders pursuant to the
realisation strategy and had no effect on the total projected
realisation value other than to reduce such total by the amounts
distributed and to reduce the amount of future interest receivable.
Accurate assessment of the amount of anticipated future
distributions is difficult. The reduced scale of the Group means
that relatively small variances have a marked effect. The proximity
of final winding up has prompted certain claims by SARS relating to
historical Group activities. These claims are disputed. Legal
proceedings by the Group for recovery of certain historic debts
remain unresolved. The final outcome of the Ministerial proceedings
and possible future costs in that regard are uncertain. Precisely
how these issues will be resolved cannot be predicted. Consequently
the directors" estimates of future distributions cannot be precisely
made. For these reasons the directors estimate that shareholders can
reasonably expect future distributions to fall within the range of
10 cents to 14 cents per share.
By order of the board
TA Wixley GB Liebmann
Chairman Executive director
7 November 2006
Audit report
The auditors PKF (Jhb) Inc. have issued their opinion on the group"s
financial statements for the year ended 31 August 2006. A copy of
their unqualified report is available for inspection at the
Company"s registered office.
Shareholders are advised that New Corpcapital"s 2006 annual report
is being posted today.
NEW CORPCAPITAL LIMITED (2001/006539/06)
1ST FLOOR 3 MELROSE SQUARE MELROSE ARCH
JOHANNESBURG 2196 - PO BOX 471917 - PARKLANDS 2121
TELEPHONE +27 11 684 1055/6/7 - TELEFAX +27 11 684 1058
DIRECTORS: D L BROOKING** N N LAZARUS* G B LIEBMANN
T A WIXLEY** (CHAIRMAN)
(*NON-EXECUTIVE) (**INDEPENDENT NON-EXECUTIVE)
(Share code: NCA & ISIN: ZAE000067765)
Rosebank
7 November 2006
Sponsor
Java Capital (Proprietary) Limited
Date: 07/11/2006 09:33:04 AM Produced by the JSE SENS Department
