Wrap Text
Reviewed condensed consolidated preliminary results - year ended 31 March 2015
Peregrine Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1994/006026/06)
JSE share code: PGR ISIN: ZAE000078127
("Peregrine" or "the group")
REVIEWED CONDENSED CONSOLIDATED PRELIMINARY RESULTS - YEAR
ENDED 31 MARCH 2015
- Normalised headline earnings per share up 36% to 270.1 cents per share
- Normalised basic earnings per share up 62% to 326.2 cents per share
- Final dividend up 50% to 150 cents per share
COMMENTARY
The Peregrine group continued to build on the strong performance of the previous year during
the twelve months ended 31 March 2015. All operating subsidiaries performed well with
Peregrine Capital in particular producing excellent results. The results were further
characterised by robust annuity revenue flows and strong returns on proprietary investments.
The contribution across all business segments highlighted the diversified nature of earnings in
the group. In addition there were pleasing additions to earnings from the newly acquired
businesses of Java Capital and Cannon Trustees.
Financial results
The basic profit attributable to shareholders increased by 59% to R677 million
(2014: R425 million) with the basic earnings per share amounting to 327.0 cents per share
(2014: 214.1 cents per share). Included in basic profit is the net capital gain of R113 million
made on the disposal of Stenham Property to Stenprop. Headline earnings increased by 31%
to R534 million (2014: R409 million) with headline earnings per share increasing by 28% to
270.9 cents per share (2014: 211.5 cents per share).
Consistent with the prior year, the board of directors feels that, in addition to providing the
IFRS disclosed earnings (which do not accurately reflect the true economic results due to the
accounting treatment relating to share based payments which resulted in enhanced IFRS
earnings in the prior year), normalised earnings should be disclosed as follows:
Normalised basic earnings attributable to shareholders increased by 70% to
R676 million (2014: R399 million) with normalised basic earnings increasing by 62% to 326.2
cents per share (2014: 200.8 cents per share). Normalised headline earnings increased by 42%
to R560 million (2014: R394 million) with normalised headline earnings per share increasing by
36% to 270.1 cents per share (2014: 198.2 cents per share).
A good indication of the cash generating capacity of the underlying operating businesses, is
that total profit before tax, capital items and non-cash amortisations, adjusted for total
minorities, amounted to R622 million (2014: R459 million).
Aggregate normalised cash in the group amounted to R705 million at year-end, of which R60
million was available at the centre, R462 million held offshore and the balance of R183
million held by local subsidiaries.
Segmental results
Substantial non-controlling interests, including Nala's shareholding in Peregrine SA
Holdings, exist in many of the group`s operations. Operating results are therefore presented
before tax, after non-controlling interests, before intangible amortisations and share-based
payment costs. Management believes this better reflects and aids in the understanding of
each division`s specific economic benefit to the shareholders of the group.
Wealth Management
Citadel continued to capitalise on its positioning as the leading private client wealth manager
in South Africa. Assets under management (including assets in its wholly owned subsidiary
Wealthcorp) increased to R34.1 billion (2014: R30.8 billion) with gross inflows for the year
amounting to R3.6 billion. The client retention rate remained in excess of 97%.
Despite strong growth in core annuity earnings, profits for the year decreased by 9% to R218
million (2014: R240 million) with earnings down primarily due to lower performance fees
earned in the third quarter of the current year.
Due to the sale of Beauclerc (the offshore based multi-family office) during the previous
financial year, the group avoided the 2014 loss of R21 million.
Asset Management
The group's Asset Management division comprises a number of fund management
businesses. The largest contributor to the division is the group's flagship hedge fund
manager, Peregrine Capital. Due to the very strong performance by Peregrine Capital, profit
increased, as a result of improved fund returns, to R137 million (2014: R60 million).
Peregrine Capital's asset base grew to R4.8 billion by year end (2014: R3.7 billion) largely as
a result of these strong returns.
Stenham
During the year, further share purchase and repurchase transactions took place in the UK and
Guernsey based asset management and trust business, of Stenham. As a result, Peregrine's
share in Stenham increased from 70.8% to 80.9%.
Peregrine's share of Stenham's profit increased by 45% to R139 million (2014: R96
million).
Stenham Asset Management was able to build on the good investment performance delivered
in the previous financial year with several of its portfolios performing well. Net outflows of
$168 million moderated significantly during the period under review (2014: $320 million)
and in the final quarter of the year, an advisory mandate of $1.2 billion was procured
resulting in total assets under management and advice of $3.2 billion at year end.
Notwithstanding good investment performance in the context of muted global market
performance, lower performance fees were earned than those in the comparable period.
Stenham Property delivered a strong trading performance relative to the previous year,
primarily as a result of fees earned in the ordinary course of business and in the execution of
the Stenprop transaction. With effect from 1 October 2014, the business was sold to
Stenprop in exchange for Stenprop shares, with certain properties being retained by Stenham
with the intention being to realise these over time. These realisations are progressing in
accordance with such plan.
Stenham Trustees continues to perform well and together with the newly acquired Cannon
Trustees (the Guernsey based trust and fiduciary company, 100% of which was acquired with
effect from 1 April 2014) is increasingly becoming a more significant contributor to Stenham
Group profits. Cannon Trustees maiden results in the group have exceeded expectation.
Stenham remains strongly cash-flow generative, with no long-term debt and cash available to
augment future growth.
Broking and Structuring
The positioning of Peregrine Securities as one of the few substantial, independent structuring
and broking entities in South Africa enabled the business to once again perform exceptionally
well. It has built several of the industry's leading franchises in the areas of prime broking and
derivative broking and structuring, which have benefited from increased financial market
trading volumes. Peregrine Securities increased its contribution by 21% to R101 million
(2014: R84 million) for the year.
Advisory
The acquisition of 50% of Java Capital was concluded with effect from 1 July 2014. Java
Capital is widely regarded as the premier independent corporate advisory house in South
Africa competing directly, and successfully, for mandates against local and international
banks. It is also the industry leader in the provision of corporate finance services in the listed
property sector.
Java Capital's contribution for the nine months (after tax and after non-controlling interests),
amounted to R27.4 million.
Group
Group investment returns net of costs amounted to R120 million (2014: R66 million)
primarily due to exceptional returns generated on the groups' proprietary investments in
hedge funds.
Issued share capital
As a result of the vesting of the third tranche of shares relating to the share scheme which was
implemented during 2010 (comprising an executive incentive scheme and a junior share
option scheme with shares vesting in three equal tranches in November 2012, 2013 and
2014), 6.357 million new Peregrine shares were allotted and issued for a consideration of R48 million.
Following the issue of such shares and the issue of 3.835 million shares to partly fund
the Java Capital acquisition, the group's issued shares amount to 223.505 million and net of
treasury shares of 20.484 million (which includes the 10 million Peregrine shares which were
purchased by the Citadel Share Trust in the prior year), amount to 203.021 million.
An extension of the executive incentive scheme was implemented in 2013, in terms of which
a maximum of 2.561 million shares will be allotted and issued at a price of R11.02 per share,
which shares will vest during November 2015. No further extension to the executive
incentive scheme has been implemented.
Dividend
The directors have resolved to declare an ordinary cash dividend of 150 cents per share for
the year ended 31 March 2015. This represents growth of 50% over last year's ordinary
dividend of 100 cents per share.
The salient dates applicable to the ordinary dividend:
Last date to trade cum dividend Friday, 31 July 2015
Trading ex dividend commences Monday, 3 August 2015
Record date Friday, 7 August 2015
Payment date Tuesday, 11 August 2015
In terms of the Listings Requirements of the JSE the following additional information is disclosed:
1. The ordinary cash dividend has been declared out of income reserves;
2. The local dividend tax rate is 15%;
3. There are no secondary tax on companies credits available to be utilised against the ordinary dividend;
4. The gross local dividend amount for the ordinary cash dividend is 150 cents per share
for shareholders exempt from paying dividends tax;
5. The net local dividend amount for the ordinary cash dividend is 127.5 cents per share for shareholders
liable to pay dividends tax;
6. The issued share capital of Peregrine is 223 504 662 shares of 0.1 cent each; and
7. Peregrine's tax reference number is 9181924847.
Shares may not be dematerialised or rematerialised between Monday, 3 August 2015 and
Friday, 7 August 2015, both dates inclusive.
Directorate
There have been no changes to the board of directors during the year under review.
Conclusion
Peregrine has managed to deliver a set of results which has once again capitalised on its strong base of profitable,
cash generative operating businesses. Levels of annuity income and proprietary returns have increased substantially,
thus highlighting the diversified nature of the earnings streams. In addition the group continues to focus on growing
its businesses organically and driving cross business revenue synergies. Our new acquisitions have exceeded expectation
and the group is well positioned to capitalise on further growth opportunities.
Jonathan Hertz Sean Melnick
Group CEO Non-executive Chairman
Sandton
10 June 2015
Directors: SA Melnick^ (Chairman); J Hertz (CEO); RE Katz (CFO); M Yachad; BC Beaver*;
P Goetsch^; LN Harris#; S Sithole*; SI Stein*
^Non-executive *Independent non-executive #Lead independent non-executive
Company secretary and registered office: Peregrine Management Services Proprietary
Limited, 6A Sandown Valley Crescent, Sandown, Sandton, 2196 (PO Box 650361, Benmore,
2010), Telephone: +27 11 722 7400 Fax: +27 11 722 7410
Transfer Secretaries: Computershare Investor Services Proprietary Limited, 70 Marshall
Street, Johannesburg, 2001, (PO Box 61051, Marshalltown, 2107)
Joint Sponsor: Java Capital
Joint Independent Sponsor: Deloitte & Touche Sponsor Services Proprietary Limited
Further detail and a print-friendly version of these results are available from the company's propriety limited
website at www.peregrine.co.za on Thursday, 11 June 2015.
Condensed consolidated statement of comprehensive income
For the year ended 31 March
% change
2014 to
2015 Reviewed 2015 Audited 2014
R'000 R'000
Operating revenue 20 2 410 756 2 015 499
Investment and other income >100 227 596 101 419
Total revenue 25 2 638 352 2 116 918
Fair value gains on linked financial investments 52 337 725 856
Fair value loss on policyholder contract liabilities (52 337) (725 856)
Operating expenses 23 (1 786 412) (1 454 762)
Profit from operations 29 851 940 662 156
Net interest received 36 72 196 53 045
Interest received 75 874 55 201
Interest paid (3 678) (2 156)
Share of profits from equity accounted investees 73 70 568 40 727
Profit before taxation and capital items 32 994 704 755 928
Net gain on disposal of interest in subsidiaries 148 086 5 139
Profit before taxation 50 1 142 790 761 067
Taxation (221 024) (156 797)
Profit for the year 53 921 766 604 270
Other comprehensive income for the year net of taxation
Items that may be reclassified subsequently to profit or loss:
Currency translation differences 43 200 249 758
Total comprehensive income for the year 964 966 854 028
Profit for the year attributable to :
Equity holders of the company 59 676 951 425 023
Non-controlling interests 37 244 815 179 247
53 921 766 604 270
Total comprehensive income for the year attributable to :
Equity holders of the company 714 265 600 177
Non-controlling interests 250 701 253 851
964 966 854 028
Basic earnings per ordinary share (cents) 53 327.0 214.1
Diluted earnings per ordinary share (cents) 55 318.0 205.5
Number of ordinary shares in issue ('000) 223 505 213 001
Treasury shares held ('000) 20 484 20 484
Weighted average number of ordinary shares in issue ('000) 197 284 193 305
Diluted weighted average number of shares in issue ('000) 202 898 201 409
Reconciliation between earnings and headline earnings
For the year ended 31 March
%
change
2014 to Reviewed
2015 2015 Audited 2014
R'000 R'000
Profit for the year attributable to equity holders 59 676 951 425 023
Adjustment relating to earnings attributable to participating treasury shares (31 779) (11 155)
Profit attributable to ordinary shareholders 56 645 172 413 868
Gross effect of net gain on disposal of interest in subsidiaries ¹ (142 626) (5 004)
Non-controlling interest effect of net gain on disposal of interest in subsidiaries 31 799 -
Headline earnings 31 534 345 408 864
Headline earnings per ordinary share (cents) 28 270.9 211.5
Diluted headline earnings per ordinary share (cents) 30 263.4 203.0
Cash dividend paid per ordinary share in respect of the previous year (cents) 39 100.0 72.0
Cash dividend per ordinary share declared subsequent to 31 March (cents) 50 150.0 100.0
1 No tax effect
Condensed consolidated statement of financial position
As at 31 March
Reviewed 2015 Audited 2014
R'000 R'000
Assets
Non - current assets 7 647 773 6 298 451
Property, plant and equipment 63 228 33 710
Intangible assets 590 262 629 707
Investment in equity accounted investees 313 350 70 796
Investments linked to policyholder investment contracts 5 932 805 5 124 941
Financial investments 648 840 351 067
Deferred taxation 99 288 88 230
Current assets 22 719 601 15 221 591
Financial investments 1 470 999 1 238 995
Loans and receivables 146 299 43 726
Trade and other receivables 743 919 604 968
Amounts receivable in respect of stockbroking activities 17 892 958 11 492 130
Taxation 6 089 5 628
Cash and cash equivalents 2 459 337 1 836 144
Total assets 30 367 374 21 520 042
Equity and liabilities
Equity 3 230 283 2 693 403
Equity attributable to equity holders of the company 2 660 901 2 063 521
Non-controlling interests 569 382 629 882
Non - current liabilities 5 971 189 5 137 156
Policyholder investment contract liabilities 5 932 805 5 124 941
Interest-bearing borrowings 10 234 -
Loans and other payables 8 390 5 468
Deferred taxation 19 760 6 747
Current liabilities 21 165 902 13 689 483
Loans and other payables 134 359 79 893
Financial instrument liabilities 1 505 297 720 495
Trade and other payables 1 173 399 1 117 148
Amounts payable in respect of stockbroking activities 18 303 172 11 703 824
Taxation 49 675 43 874
Bank overdraft - 24 249
Total equity and liabilities 30 367 374 21 520 042
Net tangible asset value per ordinary share (cents) 986.8 737.9
Net asset value per ordinary share (cents) 1 249.1 1 018.9
Condensed consolidated statement of changes in equity
For the year ended 31 March
Total capital and Non-controlling
reserves interests Total equity
R'000 R'000 R'000
Reviewed - 2015
Balance at 31 March 2014 2 063 521 629 882 2 693 403
Profit for the year 676 951 244 815 921 766
Other comprehensive income for the year 37 314 5 886 43 200
Transactions with owners recorded directly in equity: (116 885) (311 201) (428 086)
Dividends paid (192 828) (140 522) (333 350)
Share-based payments 19 939 - 19 939
Deconsolidation of non-controlling interest on loss of control of hedge fund - (74 361) (74 361)
Purchase of shares in subsidiary from the non-controlling shareholders (62 107) 8 617 (53 490)
Repurchase and cancellation of shares of subsidiary (17 408) (104 935) (122 343)
Issue of additional shares of holding company 135 519 - 135 519
Balance at 31 March 2015 2 660 901 569 382 3 230 283
Audited - 2014
Balance at 31 March 2013 1 706 938 522 804 2 229 742
Profit for the year 425 023 179 247 604 270
Other comprehensive income for the year 175 154 74 604 249 758
Transactions with owners recorded directly in equity: (243 594) (146 773) (390 367)
Dividends paid (196 306) (109 329) (305 635)
Share-based payments 26 642 - 26 642
Acquisition of subsidiaries with non-controlling interests - 3 698 3 698
Subscription of shares in a new subsidiary - 47 019 47 019
Contingent consideration received as a result of the disposal of interest in subsidiary 498 - 498
Purchase of shares in subsidiary from the non-controlling shareholders (24 587) (69 965) (94 552)
Disposal of shares in subsidiary to non-controlling interest shareholder 2 448 (2 389) 59
Reversal of put option cost arising on buy-back and subsequent cancellation of put option shares 8 271 7 408 15 679
Repurchase and cancellation of shares of a subsidiary (413) (23 215) (23 628)
Repurchase of treasury shares (107 070) - (107 070)
Issue of additional shares of holding company 46 923 - 46 923
Balance at 31 March 2014 2 063 521 629 882 2 693 403
Condensed consolidated statement of cash flows
For the year ended 31 March
Reviewed 2015 Audited 2014
R'000 R'000
Cash flow from operating activities 641 899 1 106 241
Cash flow from operating activities excluding stockbroking activities 793 440 764 257
Cash dividends paid (333 350) (299 719)
Cash flow from stockbroking activities 181 809 641 703
Cash flow from investing activities (129 218) (744 850)
Cash flow from financing activities 133 007 698 189
Net increase in cash and cash equivalents 645 688 1 059 580
Cash and cash equivalents at beginning of the year 1 811 895 659 131
Effects of exchange rate changes on cash and cash equivalents 1 754 93 184
Cash and cash equivalents at end of the year 2 459 337 1 811 895
Segmental analysis
For the year ended 31 March
% change in
Profit/(loss) from profit/(loss) from
ordinary activities ordinary activities
before intangible before intangible
Interest and share amortisation and share- amortisation and share-
of profits from based payment cost based payment cost
equity accounted Profit/(loss) from adjusted for non- adjusted for non-
Total revenue investees ordinary activities(1) controlling interests controlling interests
R'000 R'000 R'000 R'000 2014 to 2015
Reviewed - 2015
Wealth and Asset Management 1 056 279 50 027 475 334 355 078 27
Wealth Management - local 720 076 29 293 248 000 217 865 -9
Asset Management 336 203 20 734 227 334 137 213 >100
Broking and Structuring 667 716 32 720 181 052 101 316 21
Stenham 633 003 6 397 173 717 138 563 45
Advisory(2) - 31 879 31 879(3) 27 416 -
Total from operating reportable segments 2 356 998 121 023 861 982 622 373 36
Group 232 376 18 735 129 710 119 604 82
2 589 374 139 758 991 692 741 977 41
Audited - 2014
Wealth and Asset Management 864 361 32 302 353 822 279 718
Wealth Management - local 707 778 20 539 273 200 240 449
Wealth Management - offshore (4 403) 1 (21 094) (21 094)
Asset Management 160 986 11 762 101 716 60 363
Broking and Structuring 560 723 17 598 148 112 83 768
Stenham 529 463 18 281 132 240 95 609
Total from operating reportable segments 1 954 547 68 181 634 174 459 095
Group 109 633 27 586 66 749 65 832
2 064 180 95 767 700 923 524 927
Note : Group funding costs are disclosed as part of "group" and have not been allocated to the underlying operating reportable segments
(1) Profit/(loss) from ordinary activities is synonymous with profit/(loss) before taxation and capital items
(2) Represents a new operating reportable segment following on the acquisition of 50% of Java Capital, one of South Africa's leading independent corporate finance and advisory
businesses, with effect from 1 July 2014
(3) Represents 50% of profit after taxation
Reconciliation of segmental analysis to statement of comprehensive income
Total from
Wealth and operating
Asset Broking and reportable Non-reportable
Management Structuring Stenham Advisory segments Group segments(1) Total
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
For the year ended 31 March 2015
Total revenue per segmental analysis 1 056 279 667 716 633 003 - 2 356 998 232 376 - 2 589 374
Reconciling items: (104 722) 175 647 - - 70 925 (242 158) 220 211 48 978
Operating revenue - internal (100 836) 175 880 - - 75 044 - - 75 044
Operating revenue of non-reportable segment - external - - - - - - 1 642 1 642
Investment income - internal (3 886) (233) - - (4 119) (242 158) 246 277 -
Investment income of non-reportable segment - external - - - - - (27 708) (27 708)
Total revenue per statement of comprehensive income 951 557 843 363 633 003 - 2 427 923 (9 782) 220 211 2 638 352
Profit before taxation and capital items per segmental analysis 475 334 181 052 173 717 31 879 861 982 129 710 - 991 692
Reconciling total revenue items per above (104 722) 175 647 - - 70 925 (242 158) 220 211 48 978
Operating expenses of non-reportable segment - external - - - - - - (52 601) (52 601)
Deferred profit participation(2) 19 671 - - - 19 671 - - 19 671
Share based payment charge(2) (16 042) - - - (16 042) - - (16 042)
Interest paid - internal - 3 393 - - 3 393 56 - 3 449
Interest paid - external - - - - - - (1) (1)
Share of profits from equity accounted investees - internal - - (442) - (442) - - (442)
Profit before taxation and capital items per statement of comprehensive income 374 241 360 092 173 275 31 879 939 487 (112 392) 167 609 994 704
For the year ended 31 March 2014
Total revenue per segmental analysis 864 361 560 723 529 463 - 1 954 547 109 633 - 2 064 180
Reconciling items: (43 693) 79 315 - - 35 622 (89 879) 106 995 52 738
Operating revenue - internal (42 352) 82 193 - - 39 841 - - 39 841
Operating revenue of non-reportable segment - external - - - - - - 14 405 14 405
Investment income - internal (1 341) (2 878) - - (4 219) (89 879) 94 098 -
Investment income of non-reportable segment - external - - - - - - (1 508) (1 508)
Total revenue per statement of comprehensive income 820 668 640 038 529 463 - 1 990 169 19 754 106 995 2 116 918
Profit before taxation and capital items per segmental analysis 353 822 148 112 132 240 - 634 174 66 749 - 700 923
Reconciling total revenue items per above (43 693) 79 315 - - 35 622 (89 879) 106 995 52 738
Operating expenses of non-reportable segment - external - - - - - - (40 235) (40 235)
Deferred profit participation(2) 60 539 - - - 60 539 - - 60 539
Share based payment charge(2) (16 042) - - - (16 042) - - (16 042)
Interest paid - internal - 3 050 - - 3 050 - - 3 050
Interest received - external - - - - - (2) 51 49
Share of profits from equity accounted investees - internal - - (5 094) - (5 094) - - (5 094)
Profit before taxation and capital items per statement of comprehensive income 354 626 230 477 127 146 - 712 249 (23 132) 66 811 755 928
(1) Refers to the group's consolidated proprietary hedge and property fund investments which do not meet the quantitative thresholds for determining reportable segments
(2) Management treats the deferred profit scheme (which is settled in PGR shares) as an expense as profits are earned, but for IFRS purposes, it is a share-based payment arrangement, in which the grant date fair value is recognised over the vesting period.
Notes & Compliance
The condensed consolidated preliminary financial statements of the Peregrine group as at and for the year ended 31 March 2015 comprise the company and its subsidiaries ("the group") results and the group's interests in equity accounted investees.
Basis of preparation
The condensed consolidated preliminary financial statements are prepared in accordance with the requirements of the JSE Limited Listings Requirements for preliminary reports and the requirements of the Companies Act of South Africa. The Listings Requirements require preliminary reports to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 preliminary Financial Reporting, except for the fair value measurement disclosures required by IAS34.16A(j). The accounting policies
applied in the preparation of the condensed consolidated financial statements are in terms of IFRS and are consistent with those applied in the previous consolidated annual financial statements.
In preparing these condensed consolidated preliminary financial statements, management made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. The significant judgements made by management in applying the group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the consolidated financial statements as at and for the year ended 31 March 2014.
The preparation of the group's results have been under the supervision of R E Katz CA (SA), the Group Chief Financial Officer.
The prior year audited results are a summary of the consolidated financial statements as at and for the year ended 31 March 2014, which were prepared under the supervision of R E Katz CA (SA), the Group Chief Financial Officer. A copy of these financial statements can be obtained from the issuer's registered office.
Review report
These condensed consolidated preliminary financial statements for the year ended 31 March 2015 have been reviewed by KPMG Inc., who expressed an unmodified review conclusion. A copy of the auditor's review report is available for inspection at the company's registered office together with the financial statements identified in the auditor's report.
The auditor's report does not necessarily report on all of the information contained in the condensed consolidated preliminary financial statements. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should obtain a copy of the auditor's report together with the accompanying financial information from the issuer's registered office.
Acquisitions
1. Stenham Trustees, a wholly-owned subsidiary of Stenham Limited, acquired the entire issued share capital of Cannon Trustees (a Guernsey based trust and fiduciary company) with effect from 1 April 2014 for a minimum purchase consideration of £1 million (R17.6 million) (and maximum dependent on profits to be earned during the year ending 31 March 2015, of £3 million). Cannon Trustees was acquired as it is aligned with the business profile of Stenham Trustees.
The acquisition had the following effect on the group's assets and liabilities. The fair values reflected below represent their carrying values at the date of acquisition and therefore no fair value adjustments were recognised on acquisition. The full amount of the acquired trade receivables are expected to be collected.
R'000
Identifiable assets 75 440
Intangibles - Customer relationships 33 383
Equipment 398
Trade and other receivables 21 125
Cash and cash equivalents 20 534
Identifiable liabilities
Trade and other payables (40 300)
Fair value of identifiable net assets assumed 35 140
Goodwill arising on acquisition 17 570
Fair value of total net assets assumed 52 710
Less: Contingent consideration* (35 140)
Cash consideration 17 570
* The contingent consideration is expected to be paid during the course of the first quarter of the 2016 financial year.
In the twelve months to 31 March 2015, Cannon Trustees contributed revenue of £3.6 million (R63.7 million), profit after tax of £726 479 (R12.9 million) and non-controlling interest of £175 474 (R3.1 million).
2. On 1 April 2014, Citadel Holdings Proprietary Limited acquired an additional 45 ordinary shares in The Wealth Corporation Proprietary Limited (Wealthcorp), which comprises 30% of its issued share capital, for a total consideration of R24 million, thereby increasing its shareholding in Wealthcorp to 100%.
3. Peregrine SA Holdings Proprietary Limited subscribed for, with effect from 1 July 2014, 50% of Java Capital for a total subscription price of R205 million, of which R120 million was settled in cash and the balance of R85 million in 3 835 000 Peregrine shares. The investment in Java Capital has been accounted for as a joint venture in terms of IFRS 11.
4. Peregrine's shareholding in Stenham increased from 70.78% to 80.91% following the buy-back and subsequent cancellation of its own shares in four tranches during the course of the current year.
Disposals
1. Stenham Limited disposed of its interest in Stenham Property Holdings Limited and its subsidiaries Stenham Property Limited and Stenham Property Finance Limited effective 2 October 2014 for a total consideration £12.4 million (R223.7 million).
The net assets at the date of disposal were:
R'000
Identifiable assets 73 567
Intangibles - Goodwill 10 787
Intangibles - Trade Name 27 453
Intangibles - Customer relationships 35 327
Net asset disposed of 73 567
Gain on disposal 150 141
Proceeds 223 708
Events subsequent to reporting period
The directors are not aware of any other matters or circumstances arising since the end of the financial year which significantly affect the financial position of the Peregrine group or the results of its operations.
Contingent liabilities
Contingent liabilities as at 31 March 2015 amounted to R15.6 million (2014: R15.8 million). The composition of the contingent liabilities remains unchanged.
Commitments
Operating lease and capital commitments as at 31 March 2015 amounted to R359 million (2014: R253 million).
Applicable exchange rates
Average rates Closing rates
USD:ZAR
31 March 2015 11,07 12,12
31 March 2014 10,11 10,52
GBP:ZAR
31 March 2015 17,82 17,99
31 March 2014 16,10 17,53
Date: 10/06/2015 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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