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ARGENT INDUSTRIAL LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
("ARGENT")
REG NO 1993/02054/06
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2000
REVENUE 17%
ATTRIBUTABLE EARNINGS 9%
HEADLINE EARNINGS PER SHARE 10%
ABRIDGED CONSOLIDATED INCOME STATEMENT
FOR THE 6 MONTHS ENDED 30 SEPTEMBER 2000
R000 2000 1999
REVENUE 126 210 107 517
OPERATING INCOME BEFORE FINANCE CHARGES 13 205 11 901
NET FINANCE CHARGES 2 736 2 637
NET INCOME BEFORE TAXATION 10 469 9 264
TAXATION 1 048 1 227
NET INCOME AFTER TAXATION 9 421 8 037
EARNINGS ATTRIBUTABLE TO OUTSIDE SHAREHOLDERS 995 345
EARNINGS ATTRIBUTABLE TO ORDINARY SHAREHOLDERS 8 426 7 692
ATTRIBUTABLE EARNINGS PER SHARE (CENTS) 21,4 19,6
HEADLINE EARNINGS PER SHARE (CENTS) 21,6 19,7
DIVIDENDS PER SHARE (CENTS) 6,0 10,0
SHARES IN ISSUE (000) 39 311 39 311
ABRIDGED CONSOLIDATED CASH FLOW STATEMENT
FOR THE 6 MONTHS ENDED 30 SEPTEMBER 2000
R000 2000 1999
CASH GENERATED FROM OPERATIONS 12 225 16 809
INTEREST RECEIVED 1 347 2 240
INTEREST PAID (4 083) (4 877)
DIVIDENDS PAID (786) (3 931)
TAXATION PAID (1 421) (1 328)
CASH FLOWS FROM OPERATING ACTIVITIES 7 282 8 913
CASH FLOWS FROM INVESTING ACTIVITIES (8 642) (2 339)
CASH FLOWS FROM FINANCING ACTIVITIES 10 (3 062)
NET (DECREASE)/ INCREASE IN CASH AND
CASH EQUIVALENTS (1 350) 3 512
CASH AND CASH EQUIVALENTS AT THE
BEGINNING OF PERIOD (404) 6 248
CASH AND CASH EQUIVALENTS AT THE
END OF PERIOD (1 754) 9 760
ABRIDGED CONSOLIDATED BALANCE SHEET
FOR THE 6 MONTHS ENDED 30 SEPTEMBER 2000
R000 2000 1999
ASSETS
NON-CURRENT ASSETS 101 232 92 144
PROPERTY, PLANT AND EQUIPMENT 101 232 92 144
CURRENT ASSETS 106 495 92 611
INVENTORIES 41 983 36 913
DEBTORS 64 512 45 938
BANK BALANCE AND CASH - 9 760
TOTAL ASSETS 207 727 184 755
EQUITY AND LIABILITIES
CAPITAL AND RESERVES 113 352 107 098
SHARE CAPITAL AND PREMIUM 1 966 1 966
RESERVES 29 754 35 093
ACCUMULATED PROFITS 81 632 70 039
MINORITY INTEREST 5 658 4 825
NON-CURRENT LIABILITIES 23 371 24 088
LONG-TERM LIABILITIES 21 354 21 464
DEFERRED TAXATION 2 017 2 624
CURRENT LIABILITIES 65 346 48 744
CREDITORS 53 626 38 986
CURRENT PROTION OF LONG TERM LIABILITIES 6 872 5 463
TAXATION 736 364
BANK OVERDRAFT 1 754 -
DIVIDEND PROPOSED 2 358 3 931
TOTAL EQUITY AND LIABILITIES 207 727 184 755
NET ASSET VALUE PER SHARE (CENTS) 288 272
COMMENTARY
REVIEW OF THE PERIOD'S RESULTS
THE GROUP'S ATTRIBUTABLE EARNINGS IMPROVED BY 9% TO R8,4 MILLION (1999 - R7,7
MILLION) FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2000. A SIMILAR INCREASE WAS
EXPERIENCED IN THE GROUP'S HEADLINE EARNINGS PER SHARE, WHICH INCREASED BY 10%
TO 21,6 CENTS PER SHARE (1999 -19,7 CENTS PER SHARE) FOR THE SAME PERIOD. THE
GROUP'S TURNOVER FOR THE FIRST SIX MONTHS HAS INCREASED BY 17% TO R126,2
MILLION. THE GROUP HAS A MORE THAN SATISFACTORY ORDER BOOK AND SHOULD MAINTAIN
ITS TURNOVER LEVELS FOR THE FULL FINANCIAL YEAR.
DIVISIONAL PERFORMANCE
STEEL AND STEEL PROCESSING
THE PHOENIX STEEL TRADING COMPANIES BASED IN GAUTENG AND KWAZULU-NATAL HAVE
PERFORMED WELL IN A MUCH-IMPROVED MARKET. BOTH COMPANIES HAVE INCREASED
TURNOVER AND MAINTAINED MARGINS IN THE FIRST HALF OF THE YEAR. THE PHOENIX
STEEL OUTLET IN RICHARDS BAY HAS STARTED TO BUILD A SOLID CUSTOMER BASE AND IS
EXPECTED TO BENEFIT FROM THE UPSWING IN THE CONSTRUCTION INDUSTRY IN THE
NORTHERN NATAL AREA. JOULES DECOILING & SLITTING, WHICH CONCENTRATES IN THE
COLD ROLLED MARKET, HAD A DIFFICULT START TO THE YEAR. VARIOUS IMPORTERS OF
COLD ROLLED MATERIAL HAVE MADE THE MARKET VERY COMPETITIVE, HOWEVER THE HIGHER
DOLLAR/RAND RATIO WILL IMPROVE THE MARKETS MARGINS. KOCH'S CUT AND SUPPLY
MANAGED TO MAINTAIN ITS GOOD PERFORMANCE. THE COMPANY'S SOLID REPUTATION FOR
QUALITY AND SERVICE WILL ALWAYS HOLD IT IN GOOD STEAD.
FABRICATION
HENDOR MINING SUPPLIES HAS ONCE AGAIN PERFORMED CONSISTENTLY WELL AND HAS
MANAGED TO INCREASE ITS MARKET SHARE WITHOUT FORFEITING MARGIN. THE UPSWING IN
THE PLATINUM INDUSTRY HAS RESULTED IN A FULL ORDER BOOK, WHICH SHOULD SEE THEM
MAINTAINING THEIR TURNOVER LEVELS THROUGH TO THE END OF THE FINANCIAL YEAR.
BAVARIAN METAL INDUSTRIES HAS HAD A TOUGH FIRST SIX MONTHS. THE TIPPER BODY
INDUSTRY HAS BEEN VERY ERRATIC AND HIGHLY COMPETITIVE. THE GROUP'S DECISION TO
DIVERSIFY THE COMPANY INTO GENERAL FABRICATION HAS HOWEVER STARTED TO SHOW
FAVOURABLE RETURNS.
PRECISION ENGINEERING
GIFLO ENGINEERING'S PERFORMANCE FOR THE PERIOD UNDER REVIEW HAS BEEN WELL ABOVE
EXPECTATIONS. THE COMPANY HAS SECURED ITS FIRST EXPORT ORDER FROM NORTH
AMERICA. THE AMERICAN ORDER WAS OBTAINED THROUGH A SISTER COMPANY, NEW JOULES
NORTH AMERICA AND VIA THIS RELATIONSHIP GIFLO SHOULD BE ABLE TO EXPAND ITS
EXPOSURE IN AMERICA. THE GROUP EXPECTS GIFLO TO MAKE A SIGNIFICANT CONTRIBUTION
TO EARNINGS OVER THE NEXT SIX MONTHS. NEW JOULES NORTH AMERICA'S FIRST QUARTER
HAS BEEN SOMEWHAT QUIET, HOWEVER THE COMPANY HAS SECURED VARIOUS ORDERS FOR ITS
RETARDER PRODUCTS, WHICH WILL SEE IT THROUGH FOR THE REMAINING SIX MONTHS OF
THE FINANCIAL YEAR. N W N HAS HAD A DISAPPOINTING START TO THE NEW YEAR. THE
HIGHER VOLUMES EXPECTED FROM THE RELOCATION TO KWAZULU-NATAL HAVE NOT YET
MATERIALISED.
CONCRETE AND STONE
BOTH BUSINESSES HAVE PERFORMED ADMIRABLY IN A VERY COMPETITIVE INDUSTRY.
MEGAMIX, THE CONCRETE SUPPLIER HAS GREATLY INCREASED ITS MARKET SHARE AND HAS
BECOME A MAJOR PLAYER IN THE WESTERN CAPE READYMIX CONCRETE MARKET.
VILLIERSDORP QUARRIES HAS PROVED ITSELF A VIABLE BUSINESS AND IS GENERATING
CONSTANT RETURNS. BOTH BUSINESSES ARE VERY WEATHER DEPENDENT AND MANAGED TO
MAINTAIN THEIR TURNOVER LEVELS DURING THE WET WINTER MONTHS.
MATERIALS HANDLING AND PROJECT MANAGEMENT
BARKER FLYNN & ASSOCIATES HAS SECURED AMONG OTHERS, A R49 MILLION CONTRACT WITH
LOG-X FOR THE PROJECT MANAGEMENT AND CONSTRUCTION OF THE ISCOR HEAVY MINERALS,
BULK EXPORT TERMINAL IN RICHARDS BAY. THE PROJECT COMMENCED ON 1 SEPTEMBER 2000
AND MUST BE COMPLETED BY THE END OF THE AUGUST 2001. BARKER FLYNN'S EXISTING
CONTRACTS ARE ALL ON SCHEDULE AND WILL BE COMPLETED BY THEIR RESPECTIVE DATES.
SOLIFLO THE IMPORTER OF VARIOUS MATERIAL HANDLING EQUIPMENT CONTINUES TO BE
HAMPERED BY THE RAND/DOLLAR EXCHANGE RATE. THE BUSINESS WILL BE DOWN SIZED AND
MERGED INTO BARKER FLYNN OVER THE NEXT SIX MONTHS. WE DON'T VISUALIZE THE
MERGER TO HAVE ANY ADVERSE EFFECTS ON THE GROUP.
PROSPECTS
THE ARGENT INDUSTRIAL GROUP HAS STARTED THE NEW MILLENNIUM OFF WITH ITS RUNNING
SHOES ON. THE SIX MONTHS TO 30 SEPTEMBER 2000 WAS A CHALLENGING AND EXCITING
PERIOD FOR THE GROUP. THE STRONG ORDER BOOK AND HEALTHY TURNOVER LEVELS WILL
SEE ARGENT THROUGH FOR A GOOD FINANCIAL YEAR.
DIVIDEND
NOTICE IS HEREBY GIVEN THAT DIVIDEND NUMBER 11 OF 6 CENTS PER SHARE HAS BEEN
DECLARED PAYABLE TO SHAREHOLDERS REGISTERED IN THE BOOKS OF THE COMPANY AT
CLOSE OF BUSINESS ON FRIDAY, 2 MARCH 2001. DIVIDEND CHEQUES WILL BE POSTED ON
OR ABOUT FRIDAY, 23 MARCH 2001.
ON BEHALF OF THE BOARD
T.R. HENDRY CA (SA)
MANAGING DIRECTOR
GERMISTON
6 NOVEMBER 2000
REGISTERED ADDRESS:
13 JACK PIENAAR STREET
GERMISTON SOUTH
EXTENSION 7
GERMISTON
1411
WEBSITE: WWW.ARGENT.CO.ZA
(PO BOX 14461, WADEVILLE 1422)
AUDITORS:
LOGO (ETCHELLS LEE OOSTHUIZEN INC.)
ATTORNEYS:
LOGO (ROSSOUWS)
TRANSFER SECRETARIES:
ULTRA REGISTRARS
GROUND FLOOR
11 DIAGONAL STREET
JOHANNESBURG, 2001
(PO BOX 4844, JOHANNESBURG 2000)
DIRECTORS:
T. SCHARRIGHUISEN (CHAIRMAN)
T.R. HENDRY (MANAGING)
M.J. ANTONIC (FINANCIAL)
P.A. DAY
ARMSTRONG AND ASSOCIATES
LOGO'S USED IN JOB
GIFLO ENGINEERING
PHOENIX STEEL - GAUTENG
BAVARIAN METAL INDUSRIES
NEW JOULES ENGINEERING NORTH AMERICA INC.
HENDOR MINING SUPPLIES
VILLIERSDORP QUARRIES
NWN AUTOMOTIVE PRECISION ENGINEERING
KOCHS CUT & SUPPLY STEEL CENTRE
MEGAMIX
BARKER FLYNN ASSOCIATES
SOLIFLO
JOULES DECOILING AND SLITTING
PHOENIX STEEL - NATAL
END.
