Imara Holdings (Botswana) FY 2010 financial results

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Imara Holdings (Botswana) FY 2010 financial results

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Imara Holdings (Botswana) FY 2010 financial results

  1. 1. ANNOUNCEMENT OF GROUP RESULTS FOR THE YEAR ENDED 30 APRIL 2010 The Directors of Imara Holdings Limited have pleasure in announcing the audited financial results of the Group for the twelve months ended 30 April 2010. SALIENT FEATURES AND HIGHLIGHTS Revenue Declined by 9 % Attributable earnings Decreased by 96% to P 246 765 Profit after taxation Decreased to P 500 729 Total Comprehensive Income Increased by 19% to P 6,44 million Operating loss after adjusting for special items** P1,23 million Diluted earnings per share 0,42 thebe Net exchange rate losses for the year P 3,53 million Year on year increase in cash and cash equivalents P 21,89 million to P 123,40 million Free cash flow per share P 0,38 No performance fees earned in the Asset Management Division for the year Positive contribution from associates with share of profits increasing 12 fold to P 1,92 million FIVE YEAR FINANCIAL HIGHLIGHTS 2010 2009 2008 2007 2006 Re-classified Re-stated Re-stated Re-stated Revenue P 000’s 92 809 101,516 179,084 127,550 57,680 Attributable earnings P 000’s 247 5,770 56,449 48,143 9,816 Diluted earnings per share thebe 0,42 9,9 100 90 19 Dividend yield-ordinary dividend % - 0.67 2.26 5.6 6.67 Shareholders’equity P 000’s 140,817 132,168 139,098 91,713 55,983 Total assets P 000’s 244,099 208,464 257,229 172,683 106,330 Return on equity % 0.18 4.37 40.55 52.49 17.53 ABRIDGED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Year ended 30 April 2010 2009 % Pula Pula change Re-classified Revenue 92,808,907 101,516,228 -9% Cost of services sold (14,589,090) (15,817,000) Gross profit 78,219,817 85,699,228 -9% Other income 5,032,298 6,589,779 Operating expenses (82,266,563) (82,464,015) Finance costs (162,392) (758,456) Income from associates 1,921,454 139,918 Impairment of investments in associates (581,416) (605,871) Profit before taxes 2,163,198 8,600,583 -75% Taxation (1,662,469) (2,926,805) Profit for the year 500,729 5,673,778 -91% Other comprehensive income 5,934,462 (261,056) Total comprehensive income for the year net of tax 6,435,191 5,412,722 19% Profit for the year Attributable to: Equity holders of the parent 246,765 5,769,867 -96% Minority interest 253,964 (96,089) 500,729 5,673,778 Total comprehensive income for the year Attributable to: Equity holders of the parent 6,181,227 5,508,811 12% Minority interest 253,964 (96,089) 6,435,191 5,412,722 19% EARNINGS PER SHARE: 2010 2009 thebe thebe Earnings per share - Basic 0,43 10,2 Earnings per share - Diluted 0,42 9,9 Ordinary dividend per share Passed 3 Re-classified Items: Previously, the Income Statement was segmented into continuing and discontinued operations. Discontinued operations relate to Imara Asset Management (Pty) Limited - Botswana, which is now dormant and has ceased trading. There is no intention to dispose of this company in the foreseeable future, and following a re-assessment of discontinued operations in the current year, a decision has been taken that this classification is no longer applicable and that the operations of this entity should be re-classified. Comparative financial information has been amended to take account of this re-classification. ABRIDGED CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at 30 April 2010 2009 % Pula Pula change ASSETS Non-current assets Equipment 3,612,333 3,470,742 Goodwill & intangible assets 966,324 711,357 Investment in associates 12,188,060 2,246,312 Available-for-sale-financial assets 8,475,145 5,832,270 Deferred tax asset 3,251,286 1,176,696 28,493,148 13,437,377 112% Current assets Listed trading securities 9,231,792 3,953,387 Trade and other receivables 82,312,674 89,559,076 Cash and cash equivalents 123,400,183 101,512,702 Tax refundable 661,444 1,916 215,606,093 195,027,081 11% TOTAL ASSETS 244,099,241 208,464,458 17% EQUITY AND LIABILITIES Equity Stated capital 48,532,981 44,909,348 Non-distributable reserves 17,931,894 10,312,300 Distributable reserves 74,352,559 76,946,281 Total shareholders’equity 140,817,434 132,167,929 7% Minority interest 2,003,885 327,132 Total equity 142,821,319 132,495,061 8% Non - current liabilities Interest bearing loans and borrowings-long term - 915,017 Deferred taxation 1,577,366 125,445 1,577,366 1,040,462 52% Current liabilities Trade, other payables and provisions 90,973,592 74,614,503 Listed trading securities sold short 6,537,578 140,624 Interest bearing loans and borrowings - short term 2,173,893 15,806 Tax payable 15,493 157,933 Bank overdraft - 69 99,700,556 74,928,935 33% Total liabilities 101,277,922 75,969,397 TOTAL EQUITY & LIABILITIES 244,099,241 208,464,458 17% ABRIDGED CONSOLIDATED STATEMENT OF CASH FLOW Year ended 30 April 2010 2009 Pula Pula Profit from operating activiites 2,163,198 8,600,583 Adjustments to operating profit (1,278,631) (6,994,618) Operating cash flows before working capital changes 884,567 1,605,965 Working capital changes 25,264,420 65,582,499 Income tax paid (3,992,173) (1,828,126) Net cash flows from operating activities 22,156,814 65,360,338 Cashflows from investing activities 3,615,891 12,316,051 Cashflows from financing activities (109,245) (13,215,145) Net increase in cash and cash equivalents 25,663,460 64,461,244 Cash and cash equivalents at the beginning 101,512,633 35,772,977 Exchange rate differences on cash and cash equivalents (3,775,910) 1,278,412 Cash and cash equivalents at end of year 123,400,183 101,512,633 Analysed as follows: Cash, bank and short term investments 123,400,183 101,512,702 Bank overdraft - (69) Net cash and cash equivalents 123,400,183 101,512,633 ABRIDGED STATEMENT OF CHANGES IN EQUITY Non Stated distributable Distributable Minority Capital Reserves Reserves Interest TOTAL Balance at 1 May 2008 37,111,325 9,650,370 92,336,185 423,221 139,521,101 Total comprehensive income - (261,056) 5,769,867 (96,089) 5,412,722 Issue of new shares 7,798,023 - - - 7,798,023 Movement for the year - 922,986 (21,159,771) - (20,236,785) Balance at 30 April 2009 44,909,348 10,312,300 76,946,281 327,132 132,495,061 Balance at 1 May 2009 44,909,348 10,312,300 76,946,281 327,132 132,495,061 Total comprehensive income - 5,934,462 246,765 253,964 6,435,191 Issue of new shares 3,623,633 - - - 3,623,633 Movement for the year - 1,685,132 (2,840,487) 1,422,789 267,434 Balance at 30 April 2010 48,532,981 17,931,894 74,352,559 2,003,885 142,821,319 BASIS OF PREPARATION OF FINANCIAL STATEMENTS The consolidated financial statements of the Group have been prepared on a going concern basis in accordance with International Financial Reporting Standards, (IFRS), which comprise standards approved by the International Accounting Standards Boards, (“IASB”), and interpretations approved by the Reporting Interpretations Committee, (“IFRIC”), and the applicable requirements of the Botswana Companies Act, 2003. The financial statements have been prepared on an historical cost basis except for certain financial instruments that are carried at fair value. COMMENTARY OurperformancethisyearisasoberreminderthatAfricancapitalmarketshavenotyetfullyrecoveredfromtheimpactof the global crisis and in hindsight the period under review has been difficult to accurately forecast. Although, the Group remains resilient, our headline results are disappointing. Revenue declined by 9% to P92.8 million, whilst attributable earnings decreased by 96% to P246 765. Although the profit for the year is below expectations, the Statement of Financial Position has strengthened with cash and cash equivalents improving by P21,89 million to P123,4 million with no borrowings. This creates a strong foundation for a more profitable company going forward. In this respect, we have been able to protect shareholder wealth with shareholders’equity having grown by P 8,64 million during the year. In addition, we have been able to contain operating expenses in a difficult trading environment. Operating expenses have been contained to P82,27 million, almost P200 000 lower than the previous year. Although not apparent in this announcement, our core divisions of Stockbroking and Asset Management have generated strong revenue streams and funds under management have recovered significantly. Unfortunately, this improved performance has been partially reversed by a poor performance in the Corporate Finance division, which is partly attributable to timing issues on significant mandates which could not be closed in the year under review. However, these have now started to come through, and in addition, the group will benefit from the cost cutting measures taken in this division during the second half of this year. On the positive side, the Imara Funds have continued to grow with good inflows coming through and limited redemptions. Asset Management South Africa has become profitable this year and the flagship Imara Equity Fund SA has been well received and continues to perform well. We believe this division is now set to deliver long term growth and profitability. It is encouraging to report that income from associates has grown 12 fold to P1,92 million, a clear indication that our acquisition strategy is working and yielding positive momentum. We will continue to raise our stakes in these entities going forward with a positive impact on the Group and will continue to look for further expansion opportunities. OUTLOOK We remain cautiously optimistic about our future prospects. Annuity income streams continue to improve, albeit slowly, our acquisition strategy remains robust and is yielding positive returns, and the Group footprint continues to expand. Using the strong Statement of Financial Position as the spring board, we will continue to focus on improving performance in our existing footprint by extending our services and product range in individual markets, whilst also looking for opportunities in new markets. Webelievethecurrentuncertainworldeconomiesandsevereslowdownwillcontinuewellinto2011,soourexpectation is for a quieter year ahead. We look forward to reporting better results in due course. DIRECTORATE Philip Gray stood down as Chairman of the board at the Annual General Meeeting of the company on 26 September 2009. He subsequently resigned as a non-executive director on 14 March 2010. Roger Matthews also retired as a non-executive director at the Annual General Meeting of the company on 26 September 2009. Lethebe Maine was appointed as a non-executive director of the company on 25 November 2009. His appointment is still subject to formal approval by Non Bank Financial Institutions Regulatory Authority (“NBFIRA”) and the application is pending. DIVIDEND The dividend for the year has been passed. For & on behalf of the Board of Directors SM Ndoro MJS Tunmer Chairman Chief Executive Officer Transfer Secretaries: Corpserve Botswana First Floor, Block A, Unit 3, Plot 117 Millennium Office Park, GABORONE Telephone 393 2244: email: corpserve@info.bw Directors: SM Ndoro (Chairman), MJS Tunmer (Chief Executive Officer), AR Fleming, GE Johns, JR Legat, ACH Mackeurtan, L Maine*, RH Macleod*, DE Stone. *Subject to formal approval by“NBFIRA” For the years ended 30 April ** Operating (loss)/profit after adjusting for special items 2010 2009 2008 2007 2006 Attributable earnings P 000’s 247 5,770 56,449 48,143 9,816 Special items P 000’s (1,480) - (55,199) (18,636) - Operating (loss)/profit after adjusting for special items P 000’s (1,233) 5,770 1,250 29,507 9,816 Special items in the current year relate to profit from the disposal of a subsidiary.

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