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ITR - Intertrading Ltd - Abridged consolidated reviewed results for the year
ended 28 February 2011 and renewal of cautionary
INTERTRADING LTD
Registration number 1987/004777/06
Share code ITR ISIN code ZAE000015566
`Intertrading` or `the company`
(Suspended)
ABRIDGED CONSOLIDATED REVIEWED RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2011
AND RENEWAL OF CAUTIONARY
Reviewed Audited
28 February 28 February
ABRIDGED CONSOLIDATED 2011 2010
STATEMENTS OF FINANCIAL POSITION R`000 R`000
ASSETS
Current assets 8 502 26 397
8 502 26 397
EQUITY AND LIABILITIES
Equity 8 141 23 606
Current liabilities 361 2 791
8 502 26 397
Reviewed Audited
Year ended Year ended
28 February 28 February
ABRIDGED CONSOLIDATED 2011 2010
STATEMENTS OF CASH FLOWS R`000 R`000
Cash (utilised)/generated by operations (4 052) 1 860
Interest income 1 207 667
Finance costs - (48)
Taxation paid - (674)
Cash (utilised)/generated by operating activities (2 845) 1 805
Cash inflow from disposal of businesses - Note 1 - 4 479
Net cash flow from other investing activities 18 1 196
Net cash flow from financing activities (15 289) (2 471)
Net movement in cash (18 116) 5 009
Net cash resources at beginning of the year 23 114 18 105
Net cash resources at end of the year 4 998 23 114
SEGMENTAL ANALYSIS
Segmental revenue
Fresh produce exports - 46 334
Freight forwarding - 135 805
Listed public company costs & administration - 431
Less internal revenue - (19 399)
Net revenue - 163 171
Segmental results
Fresh produce exports - 794
Freight forwarding - 2 532
Listed public company costs & administration (1 672) (2 904)
Loss on disposal of business - (5 137)
Costs related to disposal of investments - (939)
Employee share incentive scheme costs - (1 356)
Operating loss before interest (1 672) (7 010)
Reviewed Audited
Year ended Year ended
28 February 28 February
2011 2010
SUPPLEMENTARY INFORMATION R`000 R`000
Number of ordinary shares (` 000) 50 000 50 000
Weighted average number of shares in issue (`000) 50 000 50 000
Reconciliation of headline (loss)/earnings
Basic loss (465) (7 573)
Loss on disposal of business - 6 076
Loss on disposal of assets - 8
Add: Tax effect on loss on disposal of assets - (2)
Basic loss (465) (1 491)
Loss per share (cents) (0.9) (3.0)
Headline loss per share (cents) (0.9) (15.1)
Net asset value per share - excluding
intangible assets (cents) 16.3 47.2
Net Asset value per share - including
intangible assets (cents) 16.3 47.2
Dividends per share (cents) 30.0 6.0
Reviewed Audited
Year ended Year ended
28 February 28 February
CONSOLIDATED STATEMENTS OF 2011 2010
OTHER COMPREHENSIVE INCOME R`000 R`000
Continuing operations
Operating costs (1 672) (544)
Operating loss before interest (1 672) (544)
Investment revenue 1 207 641
(Loss)/profit for the year (465) 97
Comprehensive (loss)/income for the year from
continuing operations (465) 97
Discontinued operations
Revenue - 163 171
Cost of sales - (138 453)
Gross profit - 24 718
Other income - 401
Operating costs - (24 153)
Operating profit before material items
separately disclosed - 966
Material items separately disclosed
Loss on disposal of business - Note 1 (6 076)
Loss on disposal of businesses - (5 137)
Costs related to disposal of investments - (939)
Employee share incentive scheme costs - (1 356)
Operating loss before interest - (6 466)
Investment revenue - 26
Loss from equity accounted investments - (187)
Finance costs - (48)
Net loss before taxation - (6 675)
Taxation - (995)
Total comprehensive loss for the year
from discontinued operations - (7 670)
Total comprehensive loss for the year
attributable to the equity holders of the parent (465) (7 573)
Reviewed Audited
Year ended Year ended
28 February 28 February
ABRIDGED CONSOLIDATED 2011 2010
STATEMENTS OF CHANGES IN EQUITY R`000 R`000
Equity at beginning of year 23 606 34 179
Total comprehensive loss for the year (465) (7 573)
Dividend (15 000) (3 000)
Equity at end of year 8 141 23 606
NOTE 1 - DISPOSAL OF BUSINESSES
Property, plant and equipment 3 237
Goodwill 4 648
Deferred tax 3 294
Inventories 205
Trade and other receivables 18 622
Cash and cash equivalents 4 321
Loans to group companies (265)
Trade and other payables (19 685)
Current tax payable (50)
Investment in Joint Venture (390)
Net assets disposed of 13 937
Loss on disposal (5 137)
Proceeds on disposal 8 800
Net cash disposed of (4 321)
Cash inflow on disposal of businesses 4 479
The financial information contained in this report has been reviewed by the
group`s auditors, PKF (Jhb) Inc. A copy of the unqualified review report is
available for inspection at Intertrading`s registered office.
COMMENTARY
During the past year the Board of Intertrading continued looking for a way in
which critical mass could be achieved for the company to justify the current
listing and associated overhead costs, and on the 4th of March 2011, were
pleased to announce the proposed acquisition of a 60% shareholding in ConnectNet
Broadband Wireless (Proprietary) Limited ("ConnectNet")("the Proposed
Acquisition). Connectnet is a provider of value-added wireless data services for
business-to-business and machine-to-machine applications. Established in 2004,
and is a leader in GSM Data (GPRS/EDGE/3G/HSDPA/HSUPA) service provision, with
blue chip clients in the retail, financial, security, telemetry, healthcare and
pharmaceutical sectors.
Encha Tech (Proprietary) Limited ("Encha") offered to purchase 150 ordinary
shares representing 60% of the issued share capital of ConnectNet from a
shareholder of ConnectNet, Fast Communication Systems (Pty) Ltd ("FastComm"),
for a cash consideration of R45,6 million ("the Offer") which Offer has been
accepted by FastComm.
In terms of the Offer, Encha is entitled to cede and transfer all of its rights
and obligations to its holding company or its subsidiary company or other
nominee ("the Encha nominee") provided that Encha shall guarantee the
performance of the obligations of the Encha Nominee. On 21 February, the board
of Intertrading accepted a proposal from Encha to assume Encha`s rights and
obligations in terms of the offer by issuing shares in Intertrading at a price
of 15 cents per Intertrading share. Encha notified FastComm of its election
to cede its rights in terms of the offer to Intertrading, which election was
accepted by FastComm.
Encha has entered into an agreement with FastComm in terms of which Encha will
acquire all of the Intertrading shares issued to FastComm at a price of 15 cents
per share. This transaction is an affected transaction and will require Encha to
make a mandatory offer at a price of 15 cents per share in terms of the
Securities Regulation Panel Code.
The rationale for the Proposed Acquisition is to lift the suspension of trading
in Intertrading and to remove the current cash shell status of Intertrading. The
Proposed Acquisition will give shareholders exposure to an exciting technology
company or the opportunity to accept the mandatory offer as mentioned above.
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The results for the year ended 28 February 2011 and the comparative information
have been prepared in terms of International Financial Reporting Standards
(IFRS). The results also comply with IAS 34 (Interim Financial Reporting) and
the relevant sections of the South African Companies Act, 1973, as amended, as
well as the AC 500 standards as issued by the Accounting Practices Board and in
terms of the Listings Requirements of the JSE Limited. The accounting policies
applied in the preparation of the results for the year ended 28 February 2011
are consistent with those adopted in the financial statements for the year ended
28 February 2010.
RENEWAL OF CAUTIONARY ANNOUNCEMENT AND FURTHER DOCUMENTATION
Shareholders are advised that once the final agreements and financial effects
relating to the Proposed Acquisition have been finalised, a detailed terms
announcement will be released on SENS and published in the press. Shareholders
are accordingly advised to continue to exercise caution when dealing in the
company`s securities until a further announcement is made.
A circular to shareholders containing the requisite information pertaining to
the Proposed Acquisition and convening a meeting of shareholders will be posted
to shareholders in due course.
DIRECTORATE
Mr Gontse S Moseneke, a director of Encha, has been appointed as a non-executive
director to the board of Intertrading with effect from 19 April 2011.
PROSPECTS
Encha Group Limited ("Encha Group"), through Encha Tech (Proprietary) Limited,
has acquired a significant minority equity stake in Intertrading Limited. Encha
Group`s equity stake will increase as a result of the proposed ConnectNet
transaction, and aims to subsequently pursue its technology investments through
Intertrading. Beyond the successful conclusion of the ConnectNet transaction and
the changing of business focus to technology, Intertrading will pursue an
acquisitive growth strategy at the listed holding company level as it seeks to
gain critical mass. There are several target opportunities in the pipeline,
which shall be disclosed to the market at the appropriate moments. The
acquisitive strategy will be complemented by achievable organic growth
strategies for the acquired underlying subsidiary companies.
By order of the board
GG Burelli (Chairman) JF Zwarts (Financial Director)
Johannesburg 06 May 2011
Registered office: Unit 2, Perishable Cargo Triangle Northern Perimeter
Road OR Tambo International Airport
(PO Box 11094, Aston Manor, 1630)
Directors: Non-executive: CPV Jousse, GG Burelli (Chairman), AA Deiner,
GS Moseneke.
Executive: JF Zwarts (Group Financial Director)
Auditors: PKF (Jhb) Inc., 42 Wierda Road West, Wierda Valley, Sandton,
2196 (Private Bag X10046, Sandton, 2196
Sponsor: Sasfin Capital (A Division of Sasfin Bank Limited)
Transfer secretaries: Computershare Investor Services (Pty) Ltd
70 Marshall Street Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Date: 06/05/2011 16:00:02 Supplied by www.sharenet.co.za
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