Sharenet Sites 
Sharenet Sites
Financial results for the six months ended 31 December 2013
Rare Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration Number: 2002/025247/06)
Share Code: RAR ISIN: ZAE000180626
("Rare" or "the Company")
UNAUDITED ABRIDGED FINANCIAL RESULTS FOR THE 6 MONTHS ENDED 31 DECEMBER 2013
Highlights
- Turnover increased by 31.8%
- Gross Profit increased by 84.0%
- EBITDA profit of R8.4m compared to R7.5m loss in comparative period.
- The group acquired a plastic pipe manufacturing facility.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
December December June
2013 2012 2013
R'000 R'000 R'000
Revenue 136 334 103 424 175 249
Cost of sales (105 114) (86 452) (149 613)
Gross profit 31 220 16 972 25 636
Other income 1 960 2 439 2 788
Operating expenses (24 804) (26 882) (51 650)
EBITDA 8 376 (7 471) (23 226)
Depreciation and amortisation (2 040) (577) (2 488)
Investment income 81 512 1 469
Finance costs (10 029) (9 641) (15 803)
Loss before taxation (3 612) (17 177) 40 048
Income tax - - (2 372)
Loss for the period (3 612) (17 177) (42 420)
Attributable to:
Equity holders of the parent (3 612) (17 177) (42 420)
Non-controlling interest - - -
Weighted average number of ordinary
shares in issue ('000) 17 888 13 536 15 664
Loss per ordinary share (cents)
(basic and diluted) (20.19) (126.90) (270.81)
Loss attributable to equity holders of
the parent (3 612) (17 177) (42 420)
Impairment of loans receivable - - 180
Reversal of loan impairment - (60) (852)
Profit/(Loss) on disposal of property,
plant and equipment - (136) 1 079
Headline loss attributable to ordinary
shareholders (3 612) (17 373) (42 013)
Headline loss per ordinary share (cents)
(basic and diluted) (20.19) (128.35) (268.21)
CONDENSED CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
December December June
2013 2012 2013
R'000 R'000 R'000
Loss for the period (3 612) (17 177) (42 420)
Total comprehensive loss for the year net
of taxation (3 612) (17 177) (42 720)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
December December June
2013 2012 2013
R'000 R'000 R'000
Assets
Non-current assets
Property, plant and equipment 65 759 53 845 50 169
Intangible assets 620 668 620
Other financial assets 21 21 380
Current Assets
Inventories 83 104 67 721 110 227
Trade and other receivables 57 141 40 440 48 739
Other financial assets 578 - 421
Construction contracts and receivables - - -
Current taxation receivable - - -
Prepayments - 122 9 984
Cash and cash equivalents 12 809 40 300 15 107
Total Assets 220 032 203 117 235 647
Equity and liabilities
Equity
Share capital 241 824 241 824 242 825
Reserves 5 350 5 346 5 350
(Accumulated loss)/Retained income (233 611) (204 456) (230 000)
Equity attributable to equity holders
of parent 13 563 43 714 18 175
Liabilities
Non-current liabilities
Other financial liabilities 183 368 67 631 134 890
Operating lease liability - 101 -
Deferred taxation 2 269 1 348 2 268
Current liabilities
Trade and other payables 15 355 30 161 70 237
Other financial liabilities 4 332 59 771 8 692
Current taxation payable 1 145 391 1 292
Bank overdraft - - 93
Total liabilities 206 469 159 403 217 472
Total equity and liabilities 220 032 203 117 235 647
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
December December June
2013 2012 2013
R'000 R'000 R'000
Opening balance 18 175 (39 100) (39 100)
Loss for the year (3 612) (17 177) (42 720)
Adjustments (1 000)
Foreign currency revaluation reserve - (9) (5)
Revaluation reserve - - (506)
Issue of shares - 100 000 100 000
Total changes (3 612) 82 814 57 275
Closing balance 13 563 43 714 18 175
Comprising of:
Share capital 132 884 132 884 132 884
Share premium 108 940 109 940 109 941
Foreign currency translation reserve - (4) -
Revaluation reserve 5 350 5 350 5 350
Retained income (233 611) (204 456) (230 000)
Total equity 13 563 43 714 18 175
CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
December December June
2013 2012 2013
R'000 R'000 R'000
Cash flows from operating activities
Cash used in operations (17 447) (34 899) (64 669)
Interest income 81 511 943
Dividends received - - -
Finance costs (563) (1 862) (2 847)
Tax received/(paid) (146) 1 208 659
Net cash from operating activities (18 076) (35 042) (65 914)
Cash flow from investing activities
Purchase of property, plant
and equipment (17 941) (249) (727)
Sale of property, plant and equipment 25 525 322
Sale of financial assets 200 - -
Purchase of other intangible assets - (157) (157)
Loans to group companies repaid - - 60
Sale of other financial assets - - 80
Net cash from investing activities (17 716) 119 (422)
Cash flows from financing activities
Outflow from share issue (1 000) 100 000 -
Proceeds from financial liabilities 36 003 44 558 54 996
Repayment of financial liabilities (1 419) (100 000) (4 311)
Net cash from financing activities 33 585 44 558 50 685
Total cash movement for the period (2 208) 9 635 (15 651)
Cash at the beginning of the period 15 014 30 665 30 665
Total cash at end of the period 12 809 40 300 15 014
*
CONDENSED SEGMENTAL INFORMATION - PRIMARY SEGMENT REPORT BUSINESS SEGMENTS
For the 6 months ending 31 December 2013
Total
Water Pipeline Manu- continuing
R'000 Trading Utilities services Investment facturing operations
Total
revenue 122 425 597 11 534 2 178 1 778 138 512
Inter-
segmental
revenue - - - (2 178) (2 178)
External
revenue 122 425 597 11 534 - 1 778 136 334
Segment
results 7 910 (1 741) (1 807) (352) 368 4 378
Other income - - - - 1 960
Profit on sale
Investment income - - - - 81
Finance cost - - - - (10 029)
Net loss
for the year - - - - (3 612)
For the 6 months ending 31 December 2012
Total
Water Pipeline continuing
R'000 Trading Utilities services Investment operations
Total
revenue 71 244 7 182 24 998 1 980 105 404
Inter-
segmental
revenue - - - (1 980) (1 980)
External
revenue 71 244 7 182 24 998 - 103 424
Segment
results (4 045) (1 948) (4 579) (305) (10 877)
Other income - - - - 2 439
Profit on sale
of assets - - - - 189
Investment income - - - - 513
Reversal of
impairment - - - - 60
Provision
Bad debts recovered - - - - 140
Finance cost - - - - (9 641)
Net loss
for the year - - - - (17 177)
For the 12 months ending 30 June 2013
Water Total
Utility Pipeline continuing
R’000 Trading services services Investment operations
Total
revenue 139 462 7 492 28 295 - 175 249
Inter-
segmental
revenue - - - - -
External
revenue 139 462 7 492 28 295 - 175 249
Segment
results (8 529) (1 309) (14 208) (212) (24 258)
Other
income - - - - 2 788
Bad debts - - - - (3 883)
Movement in
provision
for bad debt - - - - (61)
Finance
cost - - - - (15 803)
Investment
income - - - - 1 169
Income tax
expense - - - - (2 372)
Net loss
for the
year - - - - (42 420)
NOTES
BASIS OF PREPARATION
The consolidated interim financial information for the six months ended 31 December 2013 from
which these financial statements have been derived has been prepared in accordance with International
Financial Reporting Standards (IFRS), the SAICA financial reporting guides as issued by the
Accounting Practices Board, the interpretations adopted by the International Accounting
Standards Board (IASB), the Financial Reporting Pronouncement as issued by the Financial Reporting Accountants
Council, the Listings Requirements of the JSE Limited and the requirements of the South African Companies Act,
2008, as amended.
These condensed interim financial results are presented in compliance with IAS 34 - Interim Financial
Reporting and should be read in conjunction with the annual financial statements for the year ended 30 June 2013.
These financial results were internally compiled by R Viljoen CA(SA).
ACCOUNTING POLICIES
The accounting policies adopted in the preparation of the abridged interim financial information are consistent
with those of the annual financial statements of the year ended 30 June 2013. For a full list of standards and
interpretations which have been adopted we refer you to the 30 June 2013 annual financial statements.
COMMENTARY
FINANCIAL RESULTS
Revenue for the financial period increased by 31.82% to R136.3m (2012: R103.42m)as further explained under the Operational Review below.
The gross profit margin improved to 22.9% (2012: 16.4%).
Operating expenses continued its downward trend, reducing to R24.8m (2012: R26.9m) for the period under review.
An EBITDA profit of R8.4m was realized during the period (2012 loss: R7.5m). Headline loss for the period reduced to R3.6m (2012: R17.4m).
OPERATIONAL REVIEW
The major reason for the increase in revenue is the supply of a large pipe and fittings order to Randgold Resources in Mali, West Africa.
This project contributed R66.7m to revenue.
Gross profit margins improved in all divisions as a result of improved stock holding(which resulted in less buyouts of material), improved
productivity on pipeline installation projects and better cost control.
In November 2013, Rare acquired the assets and property of a High Density Polyethylene (HDPE) pipe manufacturing facility in Meyerton, Midvaal.
The factory obtained the SABS mark for HDPE pipes in January 2014 and has commenced with the manufacturing of HDPE pipes.
Full scale testing of the new Electro Coagulation Water Treatment Technology is still in progress at a major coal mine in South Africa.
Attention is drawn to the fact that, in the current reporting period, the weighted average number of shares in issue was
17,887,500 compared to a restated 13,535,900 for the previous comparable period, ended 31 December 2012, following the
implementation of the share consolidation as initially announced on SENS on 25 July 2013 and effected on 25 November
2013. The Comparable Results disclosed has taken into account the restated number of shares.
PROSPECTS
Rare Plastics: The HDPE pipe factory is up and running and should make a significant contribution to revenue during the second half of the
financial year. It is expected that the Trading Division will continue to deliver good results.
STATUTORY
Ashin Tasdhary was appointed as an Executive Director with effect from 23 January 2014.
On behalf of the board
W. van Coller R. Viljoen
CEO CFO
20 March 2014
Designated Advisor: PSG Capital (Pty) Limited
Date: 24/03/2014 01:27:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
