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Wescoal Holdings Limited - Audited Results For The Year Ended 31 March 2006

Release Date: 22/06/2006 15:09:02      Code(s): WSL
Wescoal Holdings Limited - Audited Results for the year ended 31 March 2006     
Wescoal Holdings Limited                                                        
(Incorporated in the Republic of South Africa)                                  
(Registration number 2005/006913/06)                                            
(JSE code: WSL ISIN: ZAE000069639)                                              
("Wescoal" or "the Group")                                                      
AUDITED FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2006                      
CONSOLIDATED INCOME STATEMENT                                                   
                                          Year ended    Unaudited*              
                                          31 March 2006 pro forma               
                                          Audited       group after             
R"000         Chandler                
                                                        adjustment              
                                                        (Note 1)                
                                                        Year ended              
31 March 2005           
                                                        R"000                   
  Revenue                                 178,735       194,786                 
  Gross profit                            14,357        16,677                  
Other income                            117           154                     
  Operating costs                         (10,739)      (8,067)                 
  Loss from associate                     -             (437)                   
  Profit on sale of associate company     437           -                       
Profit before interest and taxation     4,172         8,327                   
  Net interest paid                       (323)         (161)                   
  Profit before taxation                  3,849         8,166                   
  Taxation                                748           (3,370)                 
Net profit for the year                 4,597         4,796                   
  Headline earnings reconciliation                                              
  Net profit for the year                 4,597         4,796                   
  Less: Profit on sale of associate       (437)         -                       
company                                                                       
  Less: Profit on disposal of asset       -             (27)                    
  Headline earnings                       4,160         4,769                   
  Earnings per share                                                            
Ordinary shares in issue (000"s)                                              
  -Total at period end                    103,709       60,000                  
  -Weighted average shares in issue       98,098        60,000                  
  -Fully diluted weighted average         98,233        60,000                  
shares in issue (Note 2)                                                      
  Earnings per share information                                                
  Attributable earnings per ordinary      4,7           8.0                     
  share (cents)                                                                 
Headline earnings per share (cents)     4,2           8.0                     
  Fully diluted attributable earnings     4.7                                   
  per share (cents)                                     8.0                     
  Fully diluted headline earnings per     4.2           8.0                     
share (cents)                                                                 
*Restated in terms of IFRS                                                      
     Notes:                                                                     
     Wescoal, previously known as Abrina 724 Limited acquired 100% of the       
shares in Chandler Coal (Pty) Limited ("Chandler") with effect from 1      
     April 2005, and to make comparison meaningful the unaudited results of     
     Chandler has been shown.                                                   
     Pro forma calculation for 31 March 2005 is based on the conversion of the  
original 70 ordinary shares in issue to 60 000 000 under the new group     
     structure.                                                                 
     Fully diluted earnings per share information is reflected showing the      
     potential effect of the full dilution for 1 million options held by the    
Wescoal directors to subscribe for new shares in Wescoal at 50 cents per   
     share.                                                                     
CONSOLIDATED BALANCE SHEETS                                                     
                                          Audited        Unaudited*             
31 March      pro forma              
                                          2006           group after            
                                          R"000          Chandler               
                                                         adjustment             
(Note 1)               
                                                         Year ended             
                                                         31 March 2005          
                                                         R"000                  
ASSETS                                                                          
Non-current assets                        44,787         33,806                 
Property, plant and equipment             10,588         1,696                  
Goodwill                                  32,691         27,986                 
Interests in associate company            -              4,111                  
Deferred taxation                         1,508          13                     
Current assets                            36,502         21,374                 
Total assets                              81,289         55,180                 
EQUITY AND LIABILITIES                                                          
Total shareholders" funds                 42,661         30,026                 
Non-current liabilities                                                         
Long-term debt                            6,435          -                      
Current liabilities                       32,193         25,154                 
Total equity and liabilities              81,289         55,180                 
* Restated in terms of IFRS                                                     
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY                                     
Share       Share       Distribu-   Total              
                         Capital     Premium     table       R"000              
                         R"000       R"000       Reserves*                      
                                                 R"000                          
Balance at 1 April       60          -           -           60                 
2005                                                                            
Shares issued            144         38,893      -           39,037             
Listing expenses         -           (1,033)     -           (1,033)            
Earnings attributable    -           -           4,597       4,597              
to share holders                                                                
Balance as at 31 March   204         37,860      4,597       42,661             
2006                                                                            
* Restated in terms of IFRS                                                     
CONSOLIDATED CASH FLOW STATEMENTS                                               
                                          Year ended     Chandler               
                                          31 March 2006  (Note 1)               
Audited        Year ended             
                                          R"000          31 March 2005          
                                                         Audited *              
                                                         R"000                  
Net cash from operating activities        80             2,026                  
Investing activities                      (7,344)        (3,668)                
Financing activities                      9,458          2,158                  
Net increase/(decrease) in cash and       2,194          516                    
cash equivalents                                                                
Cash and cash equivalents at              768            252                    
beginning of period                                                             
Cash and cash equivalents at end of       2,962          768                    
period                                                                          
* Restated in terms of IFRS                                                     
COMMENTS                                                                        
The directors of Wescoal herewith present the maiden annual financial results   
for the year ended 31 March 2006 ("the year"). Wescoal successfully listed on   
the Alternative Exchange (AltX) of the JSE Limited on 20 July 2005 with the     
capital raising in terms of a  private placing of R7 million. The capital       
raising allowed the group to further upgrade the existing coal washing          
facilities and to aggressively pursue additional coal deposits.                 
FINANCIAL RESULTS                                                               
The group"s revenue for the year was 8.2% lower than the comparative period.    
Sales into the domestic market were 19.2% lower than last year due to extremely 
warm conditions prevailing during the 2005 winter. Similar trends were          
experienced in the off take of coal by seasonal producers and industrial        
customers. Margins reduced by 0.6% to 8.0% from last year mainly due to the low 
demand and over supply of coal product.                                         
The group acquired the remaining 66% of Wescoal Mining ("Wesmine") on 18 July   
2005. Wesmine experienced difficulties during the second half of the year       
where, during this period, raw material supply to Wesmine was interrupted for 3 
months. This situation was addressed and rectified during March 2006 with the   
signing of a raw material supply agreement.                                     
PROSPECTS                                                                       
Since the beginning of March 2006, the market conditions have improved          
resulting in Wescoal achieving record sales and profits for the first two       
months of the financial year ending 31 March 2007. In addition the raw material 
supply agreement resulted in Wesmine returning to profits. Should the favorable 
market conditions continue as expected, management is confident of achieving    
the forecast EPS and HEPS of 8,6 cents for the year ending 31 March 2007.       
DIVIDEND POLICY                                                                 
In line with the group"s growth strategy, no dividend was declared for the      
year.                                                                           
BASIS OF PREPARATION                                                            
The consolidated annual financial statements have been prepared in accordance   
with International Financial Reporting Standards (IFRS) effective at 31 March   
2006 as well as the South African Companies Act, 1973.                          
These are the group"s first IFRS financial statements and the provisions of     
IFRS 1 First-time adoption of International Financial Reporting Standards, have 
been applied.                                                                   
SUBSEQUENT EVENTS - PROPOSED ACQUISITION OF ANKER COAL & MINERAL HOLDINGS SA    
(PTY) LIMITED ("ANKER SA")                                                      
Shareholders were advised on 31 May 2006 in a detailed announcement on SENS     
that Wescoal has purchased all the issued shares in and certain shareholders"   
claims on loan account against Anker SA subject to certain conditions           
precedent, including shareholder approval.                                      
A circular with full particulars of the proposed acquisitions, as well as       
Revised Listings Particulars of Wescoal, including a Competent Persons Report   
("CPR") which is currently being undertaken by Steffen Robertson and Kirsten    
(South Africa) (Pty) Limited and a notice of general meeting of shareholders,   
will be mailed to shareholders upon completion of the CPR.                      
AUDITOR"S REPORT                                                                
The group"s auditors, Middel & Partners, have audited the group annual          
financial statements. A copy of their unqualified audit opinion is available    
for inspection at the company"s registered office.                              
By order of the Board                                                           
22 June 2006                                                                    
T E Skweyiya                  A R Boje                                          
Chairman                      Chief Executive Officer                           
CORPORATE INFORMATION                                                           
Non-Executive directors:             JG Pansegrouw,                             
                                     TA Tulwana,                                
JM Nieman (alternate for TA Tulwana)       
Executive directors:                 TE Skweyiya                                
                                     AR Boje                                    
                                     P Janse van Rensburg                       
Registration number:                 2005/006913/06                             
Registered address:                  74 von Brandis Street                      
                                     Krugersdorp                                
                                     1740                                       
Postal address:                      PO Box 133                                 
                                     Krugersdorp                                
                                     1740                                       
Company secretary:                   P Janse van Rensburg                       
Telephone:                           011 - 660 2484                             
Facsimile:                           011 - 660 2894                             
Transfer secretaries:                Computershare Investor Services 2004       
                                     (Pty) Limited                              
Designated Adviser:                  Exchange Sponsors (Pty) Limited            
Warning: The listing of ordinary shares in the company is on ALTx. Investors    
are advised of the risks of investing an a company listed on ALTx. Investors    
are advised that the JSE does not guarantee the viability or the success of a   
company listed on ALTx. In terms of the Listing Requirements, the company is    
obliged to appoint and retain a Designated Adviser, which is required to, inter 
alia, attend all board meetings held by the company to ensure that all the      
Listing Requirements and applicable regulations are complied with, approve the  
Financial Director of the company and guide the company in a competent,         
professional and impartial manner. If the company fails to retain a Designated  
Adviser, it must make arrangements to appoint a new Designated Adviser within   
10 business days, failing which the company faces suspension of trading of its  
secrities. If a Designated Adviser is not appointed within 30 days of its       
suspension, the company faces the termination of its listing without the        
prospect of an appropriate offer to minority shareholders.                      
Date: 22/06/2006 03:09:23 PM Supplied by www.sharenet.co.za                     
Produced by the JSE SENS Department                                             
                                                                                
                                                                                
                                                                                



                                        
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