Spanjaard Ltd FY 2014 financial results

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Spanjaard Ltd FY 2014 financial results

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Spanjaard Ltd FY 2014 financial results

  1. 1. Spanjaard Limited (Incorporated in the Republic of South Africa) Registration number 1960/004393/06 Share code: SPA ISIN: ZAE000006938 (“Company” or “Group”) CONDENSED GROUP AUDITED RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2014 CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND COMPREHENSIVE INCOME Year ended Year ended 28 February 28 February 2014 2013 Restated R’000 R’000 Revenue 113 766 109 515 Turnover 111 861 108 347 Cost of sales (72 109) (65 303) Gross profit 39 752 43 044 Operating expenses (32 171) (32 540) Depreciation and amortisation (2 569) (2 660) Finance (cost)/income – net (1 235) (1 437) Profit before tax 3 777 6 407 Income tax expense (1 416) (1 970) Profit from continuing operations 2 361 4 437 Discontinued operations Profit from discontinued operations 97 (402) Profit for the year 2 458 4 035 Other comprehensive income Items that will be reclassified Movement in foreign currency translation reserve 60 (508) Items that will not be reclassified Profit/(Loss) on revaluation on property, plant and equipment 459 (436) Tax effect (85) – Total comprehensive income for the year 2 892 3 091 Earnings and diluted earnings per ordinary share 19,1 50,0 – Continuing operations 17,9 54,9 – Discontinued operations 1,2 (4,9) CONSOLIDATED STATEMENT OF FINANCIAL POSITION As at As at 28 February 28 February 2014 2013 Restated R’000 R’000 Assets Non-current assets 30 160 35 755 Property, plant and equipment 28 800 34 237 Goodwill 437 437 Intangibles 923 1 081 Current assets 39 022 36 220 Non-current assets held for sale 3 759 – Total assets 72 941 71 975 Equity and liabilities Capital and reserves attributable to the Company’s equity holders 42 553 41 860 Ordinary shares and premium 6 871 6 871 Reserves 35 682 34 989 Non-current liabilities 9 377 10 897 Borrowings 4 253 5 873 Deferred tax liabilities 5 124 5 024 Current liabilities 21 011 19 218 Total equity and liabilities 72 941 71 975 CONSOLIDATED STATEMENT OF CASH FLOW Year ended Year ended 28 February 28 February 2014 2013 R’000 R’000 Cash flows from operating activities (3 018) 2 732 Cash flows from investing activities 1 093 1 811 Cash flows from financing activities (1 616) (2 703) Net (decrease)/increase in cash and cash equivalents (3 541) 1 840 Cash and cash equivalents at beginning of year 3 318 1 478 Cash and cash equivalents at end of year (223) 3 318 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY As at As at 28 February 28 February 2014 2013 R’000 R’000 Ordinary shares 407 407 Share premium 6 464 6 464 Foreign currency translation reserve (541) (601) Opening balance (601) (93) Movement for the year 60 (508) Revaluation reserve 8 082 8 296 Opening balance 8 296 9 630 Movement for the year (214) (1 334) Retained earnings 28 141 27 294 Opening balance 27 294 24 397 Total comprehensive income for the year 847 2 897 Total shareholders’ equity 42 553 41 860 DIVIDENDS Dividend declared per ordinary share (cents) – interim 15,0 15,0 – final 12,0 10,0 SUPPLEMENTARY INFORMATION Year ended Year ended 28 February 28 February 2014 2013 R’000 R’000 Capital expenditure 2 210 1 536 RECONCILIATION OF HEADLINE EARNINGS Year ended Year ended 28 February 28 February 2014 2013 Continuing operations R’000 R’000 Profit attributable to shareholders 2 361 4 437 Loss on disposal of property, plant and equipment (1 258) 51 Income tax effect on disposal 352 (14) Headline earnings 1 455 4 474 Weighted average number of ordinary shares in issue (’000) 8 143 8 143 Headline earnings per ordinary share – basic and diluted (cents) 17,9 54,9 Discontinued operations Profit attributable to shareholders 97 (402) Headline earnings 97 (402) Weighted average number of ordinary shares in issue (’000) 8 143 8 143 Headline earnings per ordinary share – basic and diluted (cents) 1,2 (4,9) OPERATING SEGMENTS Year ended Year ended 28 February 28 February 2014 2013 R’000 R’000 Segment revenue Special lubricants and allied chemical products 106 864 103 404 External foreign customers 18 076 13 780 External local customers 88 788 89 624 Metal powders 6 675 8 551 External foreign customers 3 572 4 636 External local customers 3 103 3 915 Other 3 750 3 011 External foreign customers 3 750 3 011 Reconciling items (5 428) (6 619) Inter segment sales (5 428) (6 619) 111 861 108 347 OPERATING SEGMENTS (continued) Year ended Year ended 28 February 28 February 2014 2013 R’000 R’000 Segment result Special lubricants and allied chemical products 2 862 4 105 Metal powders 1 249 419 Other 12 (1 192) Reconciling items 889 4 512 5 012 7 844 Segment assets Special lubricants and allied chemical products 57 762 50 312 Metal powders 11 558 9 951 Other 25 193 24 790 Reconciling items (21 572) (13 078) 72 941 71 975 Segment liabilities Special lubricants and allied chemical products 29 395 21 602 Metal powders 1 896 1 702 Other 20 720 18 329 Reconciling items (21 623) (11 518) 30 388 30 115 BASIS OF PREPARATION The audited condensed consolidated results have been prepared using the measurement and recognition requirements of the International Financial Reporting Standards (IFRS), the South African Institute of Chartered Accountants (SAICA) Financial Reporting Guides as issued by the Accounting Practices Committee and in the manner required by the South African Companies Act, 71 of 2008. The accounting policies and methods of computation are consistent with those of the Annual Financial Statements. This abridged report is extracted from audited financial information but is not itself audited. The directors take full responsibility for the preparation of the abridged report and that the financial information has been correctly extracted from the underlying financial statements. The condensed financial statements should be read in conjunction with the 2014 financial statements. The 2014 annual financial statements and the related audit report can be viewed on the Company’s website at www.spanjaard.biz. The annual financial statements, on which this report is based, were audited in terms of the Companies Act, 71 of 2008. Condensed group audited results prepared by: HJ van Heerden – BCom (Acc). Condensed group audited results date of publication – 29 May 2014. COMMENTARY POINTS OF INTEREST • Net asset value increased from 514,1 cents to 522,6 cents per ordinary share • Total gross cash dividend declared for the 2014 financial year totalled 27 cents (2013: 25 cents) This year we faced some important financial and operational challenges. The high increases in energy, labour and fuel costs continue to negatively impact manufacturing industries leading to a decline in our gross margin. The Group reported a profit after tax of R2 458 million (2013: R4 035 million) for the financial year ended 28 February 2014 with headline earnings per share (HEPS) amounting to 19,1 cents per share (2013: 50 cents). There were two significant non-recurring events during the financial year under review resulting in a 62% decrease in HEPS and also contributing to a 30% decline in the Special Lubricants segment’s profit: • The weakening of the Rand against all other major currencies lead to us incurring a R1,3 million loss on a Foreign Exchange Contract confirmed during April 2013; • A discrepancy in actual meter readings with City of Johannesburg resulted in an additional un-provided-for amount of R1,2 million. During the second half of the year the property in Slip Products (SA) (Pty) Limited, together with the melting operations in Coppermet (Pty) Limited and Bronzmet (Pty) Limited, was sold to Rand Refinery (Pty) Limited for the amount of R6,35 million. This transaction resulted in a 22% decrease in turnover and a 198% increase in profit of the metal powders segment. The property transfer is expected to take place in the 2015 financial year with a cash inflow of R3,3 million and is therefore classified as non-current assets held for sale. The net decrease in cash and cash equivalents were due to the following: • Increase of 44% in capital expenditure due to the acquisition of the new ERP software; • Increase in working capital; • Repayment of mortgage bond. In the Specialised Lubricants and Allied Chemicals segment, the Industrial division’s sales increased marginally, whilst the Consumer/Automotive division showed a 4% increase in sales. The International division benefited from the sharp weakening of the Rand towards the end of the financial year. A strong focus on our European markets increased sales by 25% in our subsidiary Spanjaard EU BV. DIVIDENDS Dividend No. 25 of 12 (twelve) cents per ordinary share was declared on 25 February 2014 for the year ended 28 February 2014. The dividend was subject to the Dividends Tax that was introduced with effect from 1 April 2012. In accordance with the provisions of the Listings Requirements of the Johannesburg Stock Exchange, the following additional information was disclosed: • the dividend was declared out of profits available for distribution; • the local Dividends Tax rate was 15%; • the gross local dividend amount was 12 cents per share for shareholders exempt from Dividends Tax; • no Secondary Tax on Companies’ credits was utilised; • the net local dividend amount was 10,2 cents per share for shareholders liable for Dividends Tax; • Spanjaard has 8 142 850 ordinary shares in issue; • Spanjaard’s income tax reference number is 9543 676 84 6. The following dates were applicable to the dividend: The last date to trade in order to be eligible for the dividend was Friday, 16 May 2014. Shares traded ex-dividend from Monday, 19 May 2014. The record date was Friday, 23 May 2014 and payment was made on Monday, 26 May 2014. Share certificates were not able to be dematerialised/rematerialised between Monday, 19 May 2014 and Friday, 23 May 2014, both days inclusive. AUDIT OPINION Mazars Inc. have audited the annual financial statements for the year ended 28 February 2014 from which this report is extracted and their unqualified audit report is available for inspection at the Company’s registered office. NOTICE OF ANNUAL GENERAL MEETING AND PUBLICATION OF ANNUAL REPORT Shareholders are advised that: • the Annual General Meeting of the Company (“the AGM”) will be held at 12:00 on Monday, 21 July 2014 at The Wanderers Club, 21 North Road, Illovo, Johannesburg; • the annual report, incorporating a notice convening the AGM, is available on the website of the Company at www.spanjaard.biz and will be distributed to shareholders on Monday, 2 June 2014. By order of the Board Ms SF Venter Company Secretary 29 May 2014 Directors: RJW Spanjaard (Executive Chairman) Ms E Nepgen (Managing Director) GF Cort Mrs S Hari* BL Montgomery* CKT Palmer Prof DP van der Nest* HJ van Heerden (Financial Director) *Independent Non-executive Registered office: 748 – 750 Fifth Street, Wynberg, Sandton, 2090 Transfer Secretaries: Computershare Investor Services Proprietary Limited 70 Marshall Street, Johannesburg, 2001 Sponsor: Arcay Moela Sponsors Proprietary Limited Ground Floor, ONE Health Building Woodmead North Office Park, 54 Maxwell Drive, Woodmead Email: info@spanjaard.biz Website: www.spanjaard.biz

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