|
TIW
TIW
TIW - Tiwheel - Unaudited interim group results for the six months ended
31 December 2006
Tiger Wheels Ltd.
(Incorporated in the Republic of South Africa)
(Reg No. 1970/011662/06)
Share code: TIW & ISIN: ZAE000007407
("Tiwheel" or "the group" or "the company")
Unaudited Interim Group Results for the six months ended
31 December 2006
Abridged INCOME STATEMENT
Unaudited Audited
period ended year ended
31 December 30 June
2006 2005 2006
R`000 R`000 R`000
Continuing operations
Revenue 1 603 996 1 174 409 2 370 531
Operating (loss)/income (30 368) (8 657) 23 058
Interest received 5 792 8 670 26 229
Interest paid (18 480) (15 491) (41 766)
(Loss)/profit before (43 056) (15 478) 7 521
taxation
Taxation (24 326) 19 026 7 614
(Loss)/profit from
continuing
operations (67 382) 3 548 15 135
Discontinuing operations
Profit from discontinuing
operations (note 3) - 32 073 63 936
(Loss)/profit for the (67 382) 35 621 79 071
period
Attributable to:
Equity holders of the (48 276) 33 575 75 736
parent
Minority shareholder (19 106) 2 046 3 335
Profit for the period (67 382) 35 621 79 071
Reconciliation of
headline
(loss)/earnings
per share (cents)
Attributable
(loss)/earnings per
share continuing (81,0) 3,3 22,4
operations
Adjusted for:
Closure costs - 10,9 10,8
Unbundling profits (42,2) - -
Headline
(loss)/earnings
per share (cents) (123,2) 14,2 33,2
Attributable earnings per
share
discontinued operations - 51,8 102,9
Headline (loss)/earnings
per share (cents) (123,2) 66,0 136,1
Number of shares in issue
(`000)
- At end of period
(net of treasury shares) 59 602 59 668 59 602
- Weighted average 59 602 59 799 60 439
Abridged BALANCE SHEET
Unaudited at Audited
31 December 30 June
2006 2005 2006
R`000 R`000 R`000
ASSETS
Property, plant and 1 457 775 1 248 827 1 465 567
equipment
Intangible assets 4 124 4 220 4 519
Goodwill 15 049 10 361 14 836
Other investments 65 47 64
Financial assets - 70 404 4 509
Investment tax credit 107 257 64 367 105 744
Deferred taxation 36 534 9 627 47 543
Non-current assets 1 620 804 1 407 853 1 642 782
Inventories 421 141 462 342 507 261
Trade and other 469 503 372 143 600 683
receivables
Financial assets held for - 60 970 177 810
trade
Taxation - 9 771 11 720
Bank and cash balances 149 684 251 772 148 232
Current assets 1 040 328 1 156 998 1 445 706
Total assets 2 661 132 2 564 851 3 088 488
EQUITY AND LIABILTIES
Capital and reserves 709 941 926 959 976 791
Minority interest 241 198 233 474 280 832
Total equity 951 139 1 160 433 1 257 623
Interest-bearing 613 075 231 216 585 725
liabilities
Financial liabilities - 3 008 1 673
Operating lease - 15 819 17 948
liabilities
Deferred income 107 257 64 367 106 044
Deferred taxation 43 582 11 458 55 475
Non-current liabilities 763 914 325 868 766 865
Trade and other payables 715 110 613 166 779 431
Provisions 96 507 61 732 124 729
Interest-bearing 109 245 331 660 123 290
liabilities
Short-term borrowings - 57 725 26 672
Taxation 25 217 14 267 9 878
Current liabilities 946 079 1 078 550 1 064 000
Total liabilities 1 709 983 1 404 418 1 830 865
Total equity and 2 661 132 2 564 851 3 088 488
liabilities
Net tangible asset value 1 166 1 533 1 592
per share (cents)
FOREIGN EXCHANGE RATES
Closing rate Average rate
31 December 30 June 31 December 30 June
2006 2005 2006 2006 2005 2006
Rand/Euro 9,21 7,49 9,09 9,33 7,80 7,87
Euro/Pound 1,49 1,46 1,44 1,48 1,46 1,46
Dollar/Euro 1,32 1,18 1,27 1,29 1,20 1,22
Zloty/Euro 3,84 3,87 4,06 3,90 3,97 3,94
Rand/Dollar 6,99 6,33 7,15 7,24 6,51 6,45
Rand/Pound 13,72 10,90 13,11 13,83 11,42 11,46
SEGMENTAL ANALYSIS
6 months December 2006
ATS Group Balance of group
South North South
Europe Africa America Africa Total
Rm Rm Rm Rm Rm
Revenue
Manufacturing 991 190 367 - 1 548
Wholesale 56 - - - 56
Group - - - - -
services and
intergroup
eliminations
Continuing 1 047 190 367 - 1 604
operations
Retail
Wholesale
Group
services and
intergroup
eliminations
Discontinued
operations
Total revenue 1 047 190 367 - 1 604
Operating
Income
Manufacturing 68 (12) (99) - (43)
Wholesale 5 - - - 5
Group (12) - - 20 8
services and
intergroup
eliminations
Continuing 61 (12) (99) 20 (30)
operations
Retail
Wholesale
Group
services and
intergroup
eliminations
Discontinued
operations
Total 61 (12) (99) 20 (30)
operating
income
Interest 1 - - 8 9
received
Interest paid (19) - (2) (1) (22)
Continuing (18) - (2) 7 (13)
operations
Interest
received
Interest paid
Discontinued
operations
Net financing (18) - (2) 7 (13)
costs
Interest- 592 6 (24) (1) 573
bearing debt
net of cash
Capital 19 6 106 - 131
expenditure
Depreciation 46 13 31 - 90
Future 38 10 58 - 106
capital
commitments
approved
SEGMENTAL ANALYSIS (continued)
6 months December 2005
ATS Group Balance of group
South North South
Europe Africa America Europe Africa Total
Rm Rm Rm Rm Rm Rm
Revenue
Manufacturing 738 230 195 - - 1 163
Wholesale 24 24
Group services - (2) (11) - - (13)
and intergroup
eliminations
Continuing 762 228 184 - - 1 174
operations
Retail 247 247
Wholesale - - - 117 182 299
Group services - - - - (73) (73)
and intergroup
eliminations
Discontinued - - - 117 356 473
operations
Total revenue 762 228 184 117 356 1 647
Operating
Income
Manufacturing 25 6 (30) - - 1
Wholesale 2 2
Group services (9) - - - (1) (10)
and intergroup
eliminations
Continuing 18 6 (30) - (1) (7)
operations
Retail 27 27
Wholesale - - - 4 13 17
Group services -
and intergroup
eliminations
Discontinued - - - 4 40 44
operations
Total operating 18 6 (30) 4 39 37
income
Interest 3 - - - 6 9
received
Interest paid (12) (2) (2) - (16)
Continuing (9) (2) (2) - 6 (7)
operations
Interest - - - - 4 4
received
Interest paid - - - - (5) (5)
Discontinued - - - - (1) (1)
operations
Net financing (9) (2) (2) - 5 (8)
costs
Interest- 399 5 (5) (17) (33) 349
bearing debt
net of cash
Capital 41 1 218 1 4 265
expenditure
Depreciation 36 12 18 - 3 69
Future capital 49 19 70 - - 138
commitments
approved
SEGMENTAL ANALYSIS (continued)
Year ended 30 June 2006
ATS Group Balance of group
South North South
Europe Africa America Europe Africa Total
Rm Rm Rm Rm Rm Rm
Revenue
Manufacturing 1 465 419 454 - - 2 338
Wholesale 57 - - - - 57
Group services (24) - - - - (24)
and intergroup
eliminations
Continuing 1 498 419 454 - - 2 371
operations
Retail 483 483
Wholesale - - - 238 333 571
Group services - - - - (101) (101)
and intergroup
eliminations
Discontinued - - - 238 715 953
operations
Total revenue 1 498 394 454 238 715 3 299
Operating
Income
Manufacturing 106 3 (62) 47
Wholesale 4 - - - - 4
Group services (24) - - - (4) (28)
and intergroup
eliminations
Continuing 86 3 (62) - (4) 23
operations
Retail 48 48
Wholesale 7 32 39
Group services - - - - 5 5
and intergroup
eliminations
Discontinued - - - 7 85 92
operations
Total operating 86 3 (62) 7 81 115
income
Interest 3 23 26
received
Interest paid (31) (4) (1) - (6) (42)
Continuing (28) (4) (1) - 17 (16)
operations
Interest 1 6 7
received
Interest paid (12) (12)
Discontinued - - - 1 (6) (5)
operations
Net financing (28) (4) (1) 1 11 (21)
costs
Interest- 679 5 11 - 41 736
bearing debt
net of cash
Capital 88 16 278 - 9 391
expenditure
Depreciation 75 25 38 1 6 145
Future capital 114 17 125 - - 256
commitments
approved
Abridged CASH FLOW STATEMENT
Unaudited Audited
period ended year ended
31 December 30 June
2006 2005 2006
R`000 R`000 R`000
Operating cash flow 95 102 114 453 255 412
Investing cash flow (58 921) (258 161) (412 096)
Financing cash flow (187 564) 158 333 208 668
Movement in cash resources (151 383) 14 625 51 984
Cash resources at 299 370 232 808 232 808
beginning of year
Foreign entities
translation
adjustment 1 697 7 585 14 578
Cash resources at end of 149 684 255 018 299 370
period
Comprising:
Bank and cash balances 149 684 312 743 148 232
Financial assets held - - 177 810
for trade
Short-term borrowings - (57 725) (26 672)
Net cash resources at end
of period 149 684 255 018 299 370
Free cash flow per share 60,7 (240,3) (259,2)
Abridged STATEMENT OF CHANGES IN EQUITY
Unaudited Audited
period ended year ended
31 December 30 June
2006 2005 2006
R`000 R`000 R`000
Equity at beginning of 1 257 623 1 153 760 1 153 760
period
Movement in:
Share capital - (2) (10)
Share premium (184 766) (48 767) (65 645)
Shares - (3 580) (21 515)
repurchased/(issued)
Capital distribution (184 766) (45 187) (44 130)
Share-based compensation 268 4 303 2 381
reserve
Other reserves (34 075) 11 550 63 993
Movement in foreign
currency
translation reserve (18 798) (4 316) 46 532
Hedging reserve (15 277) 15 866 17 461
Accumulated (48 276) 33 575 75 736
(loss)/profit
(Loss)/earnings
attributable to ordinary
shareholders (48 276) 33 575 75 736
Minority interest (39 635) 6 014 27 408
Share of foreign
currency translation
reserve 1 250 (395) 19 439
Share of hedging (4 132) 4 363 4 634
reserves
Disposal (17 647) - -
Share of profits (19 106) 2 046 3 335
Equity at end of period 951 139 1 160 433 1 257 623
Notes
1. Basis of preparation
This interim report has been prepared and presented in accordance with IAS 34:
Interim Financial Reporting, the Companies Act, 1973 (amended) and is in
accordance with International Financial Reporting Standards (IFRS). The
accounting policies used in the preparation of these results are consistent in
all material respects with those used in the annual financial statements for the
year ended 30 June 2006.
2. Directorate
Mr Alan Salomon was appointed as non-executive director. Messrs Keith Rivers,
Siegfried F Teichert and Sybrand G Pretorius resigned as executive and alternate
director respectively. Mr Brian Joffe resigned as non-executive director and was
appointed as alternate director to Mr Alan C Salomon. The board currently
comprises two executive and five non-executive directors, of which two are
independent directors.
3. Earnings from discontinued operations
The Tiger Automotive Group was unbundled with effect from 1 July 2006. The
comparative figures presented include the businesses that were unbundled, being
in the main Tiger Wheel and Tyre, Yokohama Southern Africa and Yokohama HTP.
2006 2005 2006
R`000 R`000 R`000
Earnings after taxation for the
period is
analysed as follows:
Revenue - 472 954 954 196
EBIT 46 126 92 782
Net interest expense - (599) (5 130)
Earnings before taxation - 45 527 87 652
Taxation - (13 454) (23 716)
Earnings after taxation - 32 073 63 936
APPOINTMENT OF A NEW COMPANY SECRETARY
In terms of paragraph 3.59 of the Listings Requirements of the JSE Limited,
Tiwheel hereby announces, due to the restructuring of the company, the
resignation of Mr M Nel as the company secretary and the appointment of Ms
Heidrun Lohr as the new company secretary with immediate effect. The board would
like to thank Mr Nel for his highly valued contribution to the company.
COMMENTS
Introduction
On 11 December 2006, the company unbundled its mainly South African trading
assets by means of a dividend "in specie" as shares in the newly listed Tiger
Automotive Limited ("TiAuto"). As a result, Tiger Wheels Limited`s 74% interest
in the ATS Group became the company`s only operating asset. Other remaining
assets at the half-year mark include cash or near cash of approximately R60
million, and the property occupied by the ATS Group`s South African subsidiary
in Babelegi. The ATS Group comprises five alloy wheel manufacturing plants - in
Germany, Poland, the USA (2), and South Africa. Together they serve the world`s
leading automotive manufacturers as an Original Equipment supplier. ATS also
operates small wholesale aftermarket alloy wheel businesses in Germany and
Poland.
Results
The group`s results for the 6 months (to 31 December 2006) are disappointing.
The main cause, as announced in the trading update issued on 19 December 2006,
was the accumulation of problems in its Kentucky, USA plant, more details of
which are laid out later in this report. Margin shortfalls, and inefficiencies
in all other plants, also contributed to the bleak half-year under review. A
further setback occurred when the South African Revenue Service attacked a major
South African bank`s funding structure under which the South African Babelegi
property was funded in 1998, the tax risk of which reverts to our company.
Whilst the exact amount of this tax charge is still being negotiated and
calculated, a conservative R19 million has been charged to headline earnings in
this period.
Operations
The crisis which led up to the significant losses incurred in the Kentucky plant
in November/December 2006, was caused by a combination of management mistakes
and market circumstances. The plant`s main customer, Ford Motor Co., brought the
launch date of a new model forward by 2 months and, as a result, the Kentucky
plant was unable to deliver the required volumes to their production lines on
time. As is a supplier`s obligation in the auto supply industry, huge costs were
incurred in airfreight, special expedited truck deliveries and slave wheel
programmes to keep the production lines running. The total cost of the
November/December Kentucky crisis was approximately Euro6,0 million (R54
million). We are pleased to report that, since December, the situation has
steadily improved, with weekly production commitments and targets being
exceeded.
To avoid similar problems recurring in Alabama, which faces a steep ramp-up
early in the next financial year, significant expenditure is being incurred now
in preparing for this growth in output, the benefits of which will only be felt
in the next financial year and thereafter.
All other plants in the group experienced, to a varying extent, both volume
and/or margin shortfalls to budget. Volume shortfalls were mainly caused by the
combination of delays in new model introductions by major customers, and end-of-
model life on some OEM contracts. This applies particularly to the Alabama and
South African plants. Margin shortfalls were prompted by certain plant
inefficiencies, which have been addressed, as well as higher-than- budgeted raw
material prices.
Management
The ATS Group CEO, Mr Siegfried F. Teichert (63), retired on 31 December 2006
after 18 years. Mr Jurgen von Heyden, who has been appointed as his successor,
took over the running of ATS on 1 March 2007. Mr von Heyden (59) has many years
of experience in the international automotive supply industry as well as an
impressive track record of success.
Prospects
As a result of the poor first-half results certain bank covenants were breached.
These breaches have been waived by the groups` bankers, who have granted the
company 12 months to rectify them. Management is confident that this deadline
(December 2007) will be met.
As a result of a major reassessment of the margins on the current and forward
order book, a decision was taken to control growth by diverting orders or, in
extreme cases, giving orders back to customers where adequate price levels are
not achievable. This mix of slower growth, strict margin and asset management,
combined with continued and intense focus on cost control and plant
efficiencies, should lead to improve results in the following years.
Unfortunately, the benefits of this programme will not be felt during the second
half of this financial year, but rather in the following year. Despite full
order books in all plants, the earnings anticipated in the European operations
for the remainder of the second half are unlikely to offset the losses forecast
in the US and South African plants. The results for the full financial year
will, therefore, probably reflect a marginal increase in the headline loss per
share shown for half year.
Based on its known order book, and assuming no major change in current global
economic circumstances, the ATS Group is forecasting a 20% increase in output
for the June 2008 financial year. Over time, this should result in a return to
acceptable profit levels.
Johannesburg
7 March 2007
On behalf of the board
Eddie Kelzan Josh Loots
Executive director Group financial director
DIRECTORS:
Eddie Keizan (Executive chairman), Phillip Vallet* (Deputy chairman and chairman
of the board), Martin Glatt*, Rainer Hagemann** (German), Josh Loots, Mike
Groves**, Alan Salomon*, Brian Joffe*, (Alternate to Allan Salomon)
*Non-executive **Independent non-executive
REGISTERED OFFICE:
Cnr Old Pretoria Road and K101, Midrand 1685
Telephone (011) 256 4500, Fax (011) 256 4515
COMPANY SECRETARY:
Heidrun Lohr (heidrun@tiw.co.za)
SPONSOR:
Sasfin Capital, a division of Sasfin Bank Limited
Registration number 1951/002280/06
TRANSFER SECRETARIES:
Computershare Investor Services 2004 (Pty) Limited
Registration number 2004/003647/07
70 Marshall Street, Johannesburg 2001
PO Box 61051, Marshalltown 2107
Telephone (011) 370 5000
Date: 07/03/2007 15:59:59 Produced by the JSE SENS Department.
| Profile Group (Pty) Ltd. has taken care in preparing all information on this website, but does not accept any liability for errors or out-of-date information. | |||||||||||||
| Other Profile Group sites: FundsData Online (unit trust data) | Profile Group corporate site | |||||||||||||
| [ Terms of Use | Privacy Policy | PAIA manual | FAQs/Help | Site Map | © Copyright Reserved 2026 ] | |||||||||||||
|
|||||||||||||
