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Unaudited Interim Results for the Six Months Ended 31 March 2013
WINHOLD LIMITED
Unaudited interim results for the six months ended 31 March 2013
Condensed Consolidated Statements of Comprehensive Income
12 Months Six Months Six Months Six Months
ended 30 ended 31 ended 30 ended 31
Sept 2012 March 2013 Sept 2012 March 2012
R000's R000's R000's R000's
916,899 Revenue (Continuing operations) 441,769 444,550 472,349
23,474 Operating profit 9,712 3,519 19,955
13,594 Investment income 5,285 6,840 6,754
(4,500) Impairments - (4,500) -
(19,988) Net finance costs (8,720) (9,743) (10,245)
12,580 Profit before taxation (Continuing ops) 6,277 (3,884) 16,464
(560) Taxation (376) 2,993 (3,553)
804 Share of associates PAT 402 165 639
(24,045) Loss from discontinued operations (2,622) (19,508) (4,537)
(11,221) Profit for the period 3,681 (20,234) 9,013
(623) Actuarial remeasurment Pension fund - (623) -
(11,844) Total comprehensive income for the period 3,681 (20,857) 9,013
(8,842) Attributable to non-controlling interests (2,067) (8,031) (811)
(1,938) - Continuing operations (1,409) (2,266) 328
(6,904) - Discontinued operations (658) (5,765) (1,139)
(3,002) Attributable to equity holders of the parent 5,748 (12,826) 9,824
14,139 - Continuing operations 7,712 917 13,222
(17,141) - Discontinued operations (1,964) (13,743) (3,398)
Earnings and diluted earnings per ordinary
(2.39) share (Cents) 4.58 (10.22) 7.83
11.27 - Continuing operations 6.14 0.73 10.54
(13.66) - Discontinued operations (1.56) (10.95) (2.71)
Headline and diluted headline earnings
1.43 per ordinary share (Cents) 4.51 (6.36) 7.78
15.09 - Continuing operations 6.07 4.59 10.49
(13.60) - Discontinued operations (1.56) (10.95) (2.71)
Weighted average ordinary shares
125,506 adjusted for treasury stock (000's) 125,506 125,506 125,506
126,215 Total ordinary shares issued (000's) 126,215 126,215 126,215
14,099 Total depreciation and amortisation 7,288 5,909 8,190
37,573 EBITDA 17,000 9,428 28,145
Reconciliation of headline earnings
(3,002) - Comprehensive income for the period 5,748 (12,826) 9,824
623 - Other comprehensive income - 623 -
4,500 - Impairments - 4,500 -
(375) - Loss on disposal of fixed assets (120) (299) (76)
44 - Taxation effects of the above 34 23 21
1,790 Total headline earnings 5,662 (7,979) 9,769
Condensed Consolidated Statements of Financial Position
12 Months Six Months Six Months Six Months
ended 30 ended 31 ended 30 ended 31
Sept 2012 March 2013 Sept 2012 March 2012
R000's R000's R000's R000's
ASSETS
149,178 Fixed assets 146,223 149,178 155,470
121,926 Unlisted investments 97,820 121,926 119,420
19,541 Goodwill 19,541 19,541 24,041
6,105 - Net) Deferred taxation 6,804 6,105 (3,755)
352,886 Current assets 304,828 352,886 402,455
121,568 - Inventory 133,854 121,568 129,730
125,023 - Receivables 129,253 125,023 152,000
35,814 - Unlisted investments 25,573 35,814 35,814
2,375 - Taxation overpaid 4,844 2,375 2,724
55,162 - Assets of disposal group 8,525 55,162 76,049
12,944 - Bank and cash 2,779 12,944 6,138
649,636 575,216 649,636 697,631
EQUITY AND LIABILITIES
122,793 Ordinary share capital and premium 122,793 122,793 122,793
118,671 Retained earnings 122,706 118,671 131,497
241,464 Equity attributable to owners of the parent 245,499 241,464 254,290
9,530 Non- controlling interests 8,830 9,530 17,561
250,994 Total Equity 254,329 250,994 271,851
Non- current liabilities
139,736 - Interest bearing 107,606 139,736 141,016
23,067 - Interest free 17,890 23,067 29,550
235,839 Current liabilities 195,391 235,839 255,214
50,655 Interest bearing- Bank overdraft 26,606 50,655 56,537
33,776 - Short term borrowings 34,055 33,776 36,032
13,045 Liabilities of disposal group 3,003 13,045 8,900
138,363 Interest free - Payables and provisions 131,727 138,363 153,745
649,636 575,216 649,636 697,631
Supporting information
795 - Capital commitments at period end 2,000 795 2,271
10,236 - Capital expenditure during the period 2,799 3,101 7,135
224,167 - Total interest bearing borrowings 168,267 224,167 233,585
27,133 - Total interest earning deposits 19,071 9,189 17,944
192.4 - Net asset value per share (Cents) 195.6 192.4 202.6
19,541 - Total intangible assets 19,541 19,541 24,067
176.8 - Tangible net asset value per share (Cents) 180.04 176.82 183.44
0.7 - Return on equity (%) 4.6 (6.6) 7.7
(1.9) - Return on assets (%) 1.1 (6.5) 2.4
Condensed Consolidated Statements of Changes in Equity
Equity attributable to holders of the parent
253,550 - Opening balance 241,464 254,290 253,550
(3,002) - Total comprehensive income for the period 5,748 (12,826) 9,824
- - Change in minority interest (1,366) - -
(9,084) - Dividends paid (347) - (9,084)
241,464 Balance at the end of the year 245,499 241,464 254,290
Condensed Consolidated Statements of Cash Flows
12 Months Six Months Six Months Six Months
ended 30 ended 31 ended 30 ended 31
Sept 2012 March 2013 Sept 2012 March 2012
R000's R000's R000's R000's
398 Cash flow from Operating activities 17,872 22,326 (21,928)
19,115 Profit before interest, tax and non-cash items 22,195 (11,596) 30,711
13,820 Changes in working capital 17,628 35,295 (21,475)
(21,679) Net finance costs (19,226) (939) (20,740)
639 Dividends from associates 402 - 639
(2,412) Taxation paid (2,780) (434) (1,978)
(9,085) Dividends paid (347) - (9,085)
10,709 Cash flow from investing activities 29,963 (8,144) 18,853
(6,795) Net investment in fixed assets 884 770 (7,565)
2,137 Deferred investment revenue received (5,269) (6,572) 8,709
15,367 Redemption / (investment) unlisted investments 34,348 (2,342) 17,709
(19,935) Cash flow from financing activities (33,951) (1,510) (18,425)
12,983 Interest bearing borrowings raised 1,575 2,530 10,453
(32,918) Interest bearing loans repaid (35,526) (4,040) (28,878)
(8,828) Net increase ((decrease) in cash 13,884 12,672 (21,500)
Condensed Consolidated Statement of 6 monthly Segment Results
Mining Consumables Industrial Consumables Flexible Plastics
1st half '13 2nd half '12 1st half '13 2nd half '12 1st half '13 2nd half '12
R000's R000's R000's R000's R000's R000's
Revenue 75,907 91,862 71,884 68,063 293,976 284,032
Operating profit (1,219) 1,792 2,019 1,624 6,987 (676)
Depreciation 219 221 276 279 6,764 5,261
Capital
expenditure 346 2,893 733 451 1,700 1,669
Total assets 67,396 125,535 64,709 65,496 318,668 344,677
Total liabilities 49,614 71,158 31,356 28,383 192,523 239,990
GROUP PROFILE
Winhold Limited (“Winhold”) is a holding company with its main investments being wholly owned subsidiaries
Gundle Limited (“Gundle”) and Inmins Limited (“Inmins”).
Gundle comprises of two plastics manufacturing and distribution operations in Gauteng and one in Swaziland,
as well as a further five distribution centres in the main coastal cities, Lowveld and Bloemfontein. Gundle
manufactures polyethylene and polypropylene bags, construction sheeting, consumer and industrial
packaging, agricultural film and dam linings and distributes to the agricultural, chemical, construction, food
processing, industrial and consumer markets.
Inmins comprises 17 strategically located operations (mainly trading) servicing the mining and industrial
sectors with a wide range of consumable and maintenance products, and includes divisions specialising in
hose, high pressure mining backfill systems, chain and sprocket systems and conveyor belting.
MARKET OVERVIEW
The flexible plastic industry has, as previously reported, an overcapacity resulting in a highly competitive
market, as manufacturers cut margins to keep volumes in their factories up. As a result, cost increases in
raw materials, labour, transport and electricity could not be recovered from customers. Non-availability of
recycled raw material for most of the period, as a result of a fire in a competitors operations, reduced
efficiencies in our building and agricultural division.
The mining industry, predominantly the platinum, gold and coal sectors remain challenged with wildcat
strikes and other industrial actions which have resulted in a significant reduction in new capital projects and
more aggressive buying patterns. Mines continue to focus on cost cutting measures, including reclaiming
and recovery of old infrastructure and moving towards supply and install contracts.
Volumes in the industrial markets remain good but margins continue to be eroded by customers focusing
more on procurement prices and a weakening of the Rand which takes time to recover from the market.
REVIEW OF OPERATIONS
Turnover from continuing operations decreased 6,4% as a result of a 30% decrease in the Inmins mining
division and a decrease in the Gundle dam lining business off its record high levels of the previous year.
Profits from continuing operations decreased to R6,3 million as a result of these lower sales and
increased operating costs which could not be recovered from customers in increasingly competitive markets
especially in Gundle. Investment income comprises, predominantly, preference dividend income. The 15%
reduction in finance costs is the result of our aggressive strategy to reduce working capital levels.
The ‘T&E value add division’ of Inmins was closed during the period and the property, stock and fixed assets
sold off and the loss for the period contained at R2,6 million. The minor run
down costs in the next 6 months will be negligible compared to the significant losses incurred in the second
half of last year. The site was cleared by the end of April but the R3,2 million profit on sale of the property
can only be recognized once the (Johannesburg Stock Exchange (“The JSE”) required) meeting of
shareholders has approved this sale. Irrevocable letters of undertaking voting in favour of the sale have
been received from more than 50% of shareholders allowed to vote.
The Inmins industrial division performance was slightly down on the comparative period last year mainly due
to the eroding of the Rand which affected importation of product, but should continue to deliver positive
results for the second period.
The Inmins mining division was significantly negatively affected by lower purchasing levels. Inmins is re-
inventing itself by actively finding and developing new higher margin agencies and product ranges and
‘supply and install’ value added services to supply to these customers. The key to the long-term success of
this mining business is to expand its range of “own products”, and to increase its customer base with sales to
smaller businesses at higher margins. A distribution agreement on pipes has been implemented and should
start contributing during the last quarter of the financial year.
The Gundle dam lining division saw an expected large reduction in sales and profit due to the high base in
the comparative previous half year as a result of record levels of export contracts in that period and, while
behind budget for the first half, this business has secured additional contracts in the second half and is
expected to make budget for the full year.
The Gundle industrial and consumer division improved off the low base of the comparable period, but
continues to make losses. Volumes are 4,6% up but margins remain very tight as the previously mentioned
price increases are not passed on to customers. Proactive action a year ago to expand sales in new market
segments has only now started to reach fruition and test runs have been accepted. The Swazi management
team has been strengthened with the appointment of a dynamic new general manager.
The Gundle construction and agricultural division did well to maintain its previous comparative results
considering the recycled raw material shortage and increasing market competitiveness.
PROSPECTS
The closure of the T&E division will ensure that the significant loss in the second half of last year will not be
repeated. The bleeding has been stopped and this will provide executive management more time to focus
on the Gundle industrial and consumer division to improve operational efficiencies and reduce costs while
developing their exciting new market segments.
The R3,0 million profit on sale of the Chamdor property will provide a once off improvement in earnings but
will have no effect on the headline earnings.
The return to profitability of the Gundle industrial and consumer division remains key to Gundle achieving
acceptable returns. Management is confident that we will begin to reap the rewards of the last year’s hard
work in developing new market segments.
BASIS OF PREPARATION AND ASSURANCE
These condensed consolidated preliminary Group results have been prepared in accordance with the
recognition and measurement criteria of International Financial Reporting Standards (“IFRS”), the SAICA
Financial Accounting Practices Committee, the information as required by IAS 34, and in compliance with the
Companies Act, as amended, and the Listings Requirements of the JSE ( “the Listings Requirements” ). The
accounting policies are consistent with those used in the prior year. The preparation of the financial
statements has been supervised by the CFO, Mr GM Scrutton CA(SA). These interim financial statements have
not been audited or reviewed by the group’s auditors. The results for the year ended 30 September 2012 were
audited and the auditor’s unqualified audit report is included in the Annual Financial statements distributed to
Shareholders’ in December 2012.
CORPORATE GOVERNANCE
The Group subscribes to the value of good corporate governance and is committed to continued
implementation of the recommendations of the King III Report and the Listings Requirements. The Group
continues to endeavour to conduct its business in accordance with the principles of accountability,
transparency and integrity.
DIRECTORATE
At the annual general meeting held on 28 February 2013, Messrs P J Kruger and D B Mostert were not re-
elected as members of the board. These vacancies have not yet been filled and the Nomination Committee is
still considering several suitable candidates. There were no other changes to the board during the six months
ended 30 March 2013
DIVIDENDS
In line with past practice, no interim dividend has been declared.
For and on behalf of the board
WAR WENTELER W Fourie
Chairman Chief Executive Officer
Date: 23 May 2013
Winhold Limited (Share code: WNH, ISIN ZAE000033916) Registration number 1945/019679/06
Incorporated in the Republic of South Africa, 884 Linton Jones Street, Industries East, Germiston.
Tel +2711 345 9800.
Directors: W A R Wenteler (Chairman) ‡, W Fourie, N P Mnxasana †‡, P. Nash‡, G M Scrutton (Financial)
(‡non-executive), († independent)
Company Secretary: G J O’Connor, johnoc@winhold.co.za fax : +2711 345 9881
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