Sharenet Sites 
Sharenet Sites
THE BUILDERS` DISCOUNT STORE (REGISTRATION NUMBER 86/01503/06) INTERIM PROFIT ANNOUNCEMENT
THE RESULTS FOR THE 26 WEEKS ENDED 27 DECEMBER 1997 TOGETHER WITH THE RESULTS FOR THE 26 WEEKS ENDED 28 DECEMBER 1996 ARE AS FOLLOWS: CONSOLIDATED INCOME STATEMENT
26 WEEKS 26 WEEKS
ENDED ENDED
27/12/97 28/12/96 PERCENTAGE (UNAUDITED) (UNAUDITED) CHANGE NOTE R`000 R`000 %
TURNOVER 472 439 401 474 17,7 OPERATING INCOME 1 11 604 9 665 20,1 NET FINANCING CHARGES (3 751) (2 840)
INCOME BEFORE TAXATION 7 853 6 825 15,1 TAXATION (2 713) (2 557)
INCOME AFTER TAXATION 5 140 4 268 OUTSIDE SHAREHOLDERS`
INTEREST (718) (664) INCOME ATTRIBUTABLE TO
SHAREHOLDERS 4 422 3 604 22,7 NUMBER OF SHARES IN ISSUE 23 224 812 23 224 812 EARNINGS PER SHARE (CENTS) 19,0 15,5 22,7 DIVIDENDS PER
SHARE (CENTS) - -
DIVIDEND COVER (TIMES) NA NA
CONSOLIDATED BALANCE SHEET 26 WEEKS 26 WEEKS ENDED ENDED 27/12/97 28/12/96 (UNAUDITED) (UNAUDITED) NOTE R000 R000 SHAREHOLDERS FUNDS 66 197 58 490 OUTSIDE SHAREHOLDERS INTEREST 5 078 3 855 INTEREST-BEARING DEBT 2 18 237 63 555 89 512 125 900 FIXED ASSETS 68 193 55 501 UNLISTED INVESTMENTS 6 499 5 787 CURRENT ASSETS 217 729 180 568 TOTAL ASSETS 292 421 241 856 INTEREST-FREE LIABILITIES 3 202 909 115 956 89 512 125 900 NET ASSET VALUE PER SHARE (CENTS) 285,0 251,8 NOTES TO THE INCOME STATEMENT AND BALANCE SHEET
1. OPERATING INCOME IS STATED AFTER CHARGING DEPRECIATION OF R5 900 000 (1996: R4 598 000). 2. INTEREST-BEARING DEBT COMPRISES THE FOLLOWING:
27/12/97 28/12/96 R`000 R`000 LONG-TERM BORROWINGS 9 237 7 691 HOLDING COMPANY LOAN AND OVERDRAFTS 9 000 55 864 18 237 63 555 3. INTEREST-FREE LIABILITIES COMPRISE THE FOLLOWING:
27/12/97 28/12/96 R`000 R`000 CURRENT LIABILITIES 199 590 114 474 DEFERRED TAXATION 3 319 1 482 202 909 115 956 4. CAPITAL EXPENDITURE IN THE PERIOD UNDER REVIEW AMOUNTS TO R7 104 000 (1996: R9 555 000). 5. COMMITMENTS AS AT DECEMBER 1997 ARE AS FOLLOWS:
27/12/97 28/12/96 R`000 R`000 CAPITAL EXPENDITURE APPROVED BY THE DIRECTORS
- CONTRACTED 990 5 464 - NOT YET CONTRACTED 13 500 6 130 14 490 11 594 COMMENTS ON THE RESULTS AND ACTIVITIES
1. CASHBUILD HAS PRODUCED A SOLID PERFORMANCE IN THE SIX-MONTH PERIOD ENDING DECEMBER 1997 WITH EARNINGS PER SHARE INCREASING BY 23%.
2. SALES INCREASED BY 18% IN THE SIX MONTHS TO DECEMBER 1997 WITH THE UPGRADED STORES CONTRIBUTING THE LION`S SHARE OF THIS INCREASE. A FOCUSED LOCAL MARKET ADVERTISING STRATEGY HAS ENABLED CASHBUILD TO INCREASE NATIONAL MARKET SHARE. 3. IMPROVEMENT IN TRADING MARGINS CONTINUED THROUGH A MORE CO-ORDINATED AND EXPERIENCED BUYING AND MARKETING TEAM.
4. BORROWINGS ARE STEADY BUT LOWER THAN LAST YEAR DUE TO THE TIMING OF PAYMENT TO SUPPLIERS. THIS IS A GOOD ACHIEVEMENT GIVEN THE OPENING OF ONE NEW STORE AND THE EXPANSION OF A SUBSIDIARY, CREDITBUILD (PTY) LTD, DEBTORS BOOK IN THE PERIOD UNDER REVIEW. PROSPECTS 1. GROWING MARKET SHARE
THE REPOSITIONING OF THE BUSINESS FROM A RURAL CASH AND CARRY WHOLESALER TO A FOCUSED LOCAL MARKET MASS DISCOUNTER IS PROGRESSING WELL. STORE REMODELLING, GOOD MANAGEMENT INFORMATION SYSTEMS AND FURTHER IMPROVING, ENTHUSIASTIC MANAGEMENT OF THE BUSINESS WILL GIVE CASHBUILD A SUBSTANTIAL COMPETITIVE ADVANTAGE IN THE MARKET. THESE ADDED STRENGTHS PLUS THE PROVEN ADVERTISING STRATEGY WILL ENSURE THAT CASHBUILD CONTINUES TO GROW MARKET SHARE. 2. IMPROVING MARGINS
CASHBUILD WILL ALSO CONTINUE TO IMPROVE MARGINS WHILST MAINTAINING PRICE LEADERSHIP FOR QUALITY BUILDING PRODUCTS BY UTILISING ITS MASSIVE BUYING VOLUMES AND THE SKILLS AND EXPERIENCE OF THE BUYING AND MARKETING TEAM. 3. CUSTOMER SERVICE
STORE AND FIELD MANAGEMENT HAVE BEEN STRENGTHENED TO CONCENTRATE ON QUALITY AND DEPENDABLE CUSTOMER SERVICE THROUGH TAILORED TRAINING METHODS, PRODUCT AVAILABILITY AND KNOWLEDGE OF LOCAL MARKETS. DIVIDEND NO INTERIM DIVIDEND HAS BEEN DECLARED. ON BEHALF OF THE BOARD C STASSEN PK GOLDRICK CHAIRMAN CHIEF EXECUTIVE 12 FEBRUARY 1998
