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CULLINAN HOLDINGS LIMITED
INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 MARCH 2000
GROUP INCOME STATEMENT
AUDITED SIX MONTHS ENDED AUDITED
YEAR ENDED
31 MARCH 31 MARCH 30 SEPTEMBER
2000 1999 1999
R'000 R'000 R'000
TURNOVER 252 852 198 418 600 348
OPERATING INCOME/(LOSS)
- CONTINUING OPERATIONS 1 355 12 550 10 034
- DISCONTINUED OPERATIONS (305) - (1 375)
EXCEPTIONAL ITEMS (1 632) 5 663 16 965
NET OPERATING INCOME/(LOSS) (582) 18 213 25 624
INTEREST (PAID)/RECEIVED (1 515) (377) (3 491)
INCOME/(LOSS) BEFORE TAXATION (2 097) 17 836 22 133
TAXATION - STC 280 203 537
NET INCOME/(LOSS) AFTER
TAXATION (2 377) 17 633 21 596
OUTSIDE SHAREHOLDERS' INTEREST 810 (178) 834
PREFERENCE DIVIDENDS (2 435) (1 626) (4 302)
NET ATTRIBUTABLE INCOME/(LOSS) (4 002) 15 829 18 128
ORDINARY SHARES (000'S)
- IN ISSUE 734 638 729 781 734 638
- USED TO CALCULATE PROFIT AND
HEADLINE PROFIT PER ORDINARY
SHARE (WEIGHTED AVERAGE) 734 638 729 781 732 629
INCOME PER ORDINARY SHARE
(CENTS) (0,5) 2,2 2,5
HEADLINE INCOME PER ORDINARY
SHARE (CENTS) (0,3) 1,4 0,2
DETERMINATION OF HEADLINE
EARNINGS NET ATTRIBUTABLE
INCOME (4 002) 15 829 18 128
PROFIT ON SALE OF SUBSIDIARIES,
PLANT AND EQUIPMENT - (6 962) (31 137)
RECONSTRUCTION, REORGANISATION
AND OTHER EXPENSES 1 632 1 299 14 172
HEADLINE INCOME/(LOSS) (2 370) 10 166 1 163
GROUP BALANCE SHEET
AUDITED
30 SEPTEMBER
UNAUDITED 1999
31 MARCH 31 MARCH AFTER
INTANGIBLES
2000 1999 WRITTEN OFF
R'000 R'000 R'000
FIXED ASSETS - TANGIBLE 61 808 48 887 58 789
- INTANGIBLE - - -
CURRENT ASSETS 257 289 245 695 259 073
INVENTORIES 99 044 119 010 104 379
ACCOUNTS RECEIVABLE 158 245 126 685 154 694
CASH RESOURCES - - -
TOTAL ASSETS 319 097 294 582 317 862
CURRENT LIABILITIES (220 795) (188 401) (211 358)
ACCOUNTS PAYABLE (217 689) (141 546) (199 072)
BANK OVERDRAFTS (3 106) (46 855) (12 286)
98 302 106 181 106 504
INTEREST-BEARING TERM LOANS (11 847) (15 269) (15 237)
NET ASSETS 86 455 90 912 91 267
FINANCED BY:
ORDINARY SHAREHOLDERS' FUNDS 39 680 68 300 43 682
PREFERENCE SHAREHOLDERS' FUNDS 46 046 21 046 46 046
OUTSIDE SHAREHOLDERS' INTEREST 729 1 566 1 539
SHAREHOLDERS' FUNDS 86 455 90 912 91 267
FINANCIAL STATISTICS
GEARING (%) 151,0 119,0 162,7
CURRENT RATIO 1,2 1,3 1,2
NET ASSET VALUE PER SHARE (CENTS) 5,4 12,5 5,9
SUMMARISED GROUP CASH FLOW STATEMENT
UNAUDITED SIX MONTHS ENDED AUDITED
31 MARCH 31 MARCH 30 SEPTEMBER
2000 1999 1999
R'000 R'000 R'000
CASH FLOWS FROM OPERATING ACTIVITIES
OPERATING (LOSS)/INCOME (582) 18 213 25 624
DEPRECIATION 4 517 4 647 11 695
RESTRUCTURING PROVISIONS
AND EXCEPTIONAL ITEMS - (6 912) (28 968)
OTHER NON-CASH ITEMS - (50) (357)
DECREASE/(INCREASE) IN
WORKING CAPITAL 20 401 (35 778) (69 159)
CASH GENERATED FROM/(UTILISED BY)
OPERATING ACTIVITIES 24 336 (19 880) (61 165)
INTEREST PAID (1 515) (377) (3 491)
TAXATION PAID (280) (223) (791)
PREFERENCE DIVIDENDS PAID (2 435) (1 261) (4 773)
NET CASH (OUTFLOW)/INFLOW FROM
OPERATING ACTIVITIES 20 106 (21 741) (70 220)
CASH FLOWS FROM INVESTING ACTIVITIES
INVESTMENT TO MAINTAIN OPERATIONS
REPLACEMENT OF FIXED ASSETS (7 722) (3 339) (11 244)
- NET PROCEEDS FROM DISPOSAL
OF FIXED ASSETS 186 1 188 4 735
-PROCEEDS FROM DISPOSAL OF
SUBSIDIARIES AND INVESTMENTS - 2 000 39 578
INVESTMENT TO EXPAND OPERATIONS
ADDITIONS TO FIXED ASSETS - (10 917) -
-NET (OUTFLOW)/PROCEEDS FROM
DISPOSALS AND ACQUISITIONS - (74 227) (70 677)
NET CASH (OUTFLOW)/INFLOW FROM
INVESTING ACTIVITIES (7 536) (85 295) (37 608)
CASH FLOWS FROM FINANCING
ACTIVITIES PROCEEDS ON ISSUE
OF SHARES - - 25 000
LONG-TERM LIABILITIES
(REPAID)/RAISED (3 390) 8 736 13 048
OUTSIDE SHAREHOLDERS' FUNDING - - 6 049
NET CASH (OUTFLOW)/INFLOW
FROM FINANCING ACTIVITIES (3 390) 8 736 44 097
(INCREASE)/DECREASE IN CASH
AND CASH EQUIVALENTS 9 180 (98 300) (63 731)
COMMENTS
THE RESULTS FOR THE PAST SIX MONTHS HAVE BEEN UNACCEPTABLE. A MIXTURE OF GOOD
RESULTS FROM MIDMACOR AND MANEX, AND ACCEPTABLE RESULTS FROM TOURISM HAVE BEEN
NEGATED BY LOSSES AT CADAC AND KARRIMOR, TOGETHER WITH AN INTEREST BILL THAT IS
TOO HIGH. THE PRIORITY OF THE COMPANY NOW IS TO ADDRESS THE BALANCE SHEET
STRAIN, AND TO STOP THE LOSSES AT THE TWO MAIN OUTDOOR LIFESTYLE BUSINESSES.
THE BALANCE SHEET GEARING IS BEING ADDRESSED AND SHOULD BE SOLVED IN THE NEXT
HALF YEAR BY THE SALE OF DISCONTINUED OPERATIONS.
DIVISIONAL COMMENTARY
TOURISM & TRAVEL
THOMPSONS SOUTH AFRICA (INBOUND TOURISM)
TURNOVER INCREASED MARGINALLY AND IN SPITE OF COSTS ASSOCIATED WITH BUILDING
MARKETS IN PARTS OF EUROPE AND THE USA NOT TRADITIONALLY SERVICED BY THOMPSONS,
THE PROFITABILITY IMPROVED DUE TO BETTER MARGINS AND A HEALTHY CONTRIBUTION
FROM TOURING AND INDABA SAFARI TOURS, THE 4X4 OPEN VEHICLE TOUR OPERATOR.
THOMPSONS TOURS (OUTBOUND AND REGIONAL)
IN SPITE OF A DISAPPOINTINGLY QUIET MILLENNIUM, THOMPSONS SIGNIFICANTLY
INCREASED BOTH ITS TURNOVER AND ITS EARNINGS FOR THE PERIOD.
THOMPSONS TRAVEL & LEISURE
EARNINGS FROM THE RETAIL LEISURE DIVISION AND THE CORPORATE DIVISION WERE FLAT
AS THEY BOTH ADJUSTED TO THE NEW AIRLINE COMMISSION STRUCTURES.
PENTRAVEL
PEN OFFICES PRODUCED AN EXPECTED SEASONAL LOSS FOR THE FIRST SIX MONTHS, AND
THIS WILL BE REVERSED IN THE SECOND HALF.
CULLINAN BUSINESS SYSTEMS
THOMPSONS.CO.ZA, THE NEW INTERNET WEBSITE DEVELOPED FOR THOMPSONS IS NOW
WORKING WELL AND GENERATING PROFITABLE ENQUIRIES. SUBSTANTIAL SET-UP COSTS OF
THIS E-COMMERCE DEVELOPMENT ARE BEING INCURRED.
OUTDOOR LIFESTYLE
MIDMACOR HONDA/MANEX POWER & MARINE
BOTH TRADING DIVISIONS GENERATED EXCELLENT RESULTS WITH RECORD SALES AND
PROFITS.
CADAC
THE BENEFITS OF A SUBSTANTIAL MANAGEMENT RESTRUCTURE WILL ONLY IMPACT ON
PROFITS IN THE NEXT FINANCIAL YEAR, AND THEREFORE IT PRESENTLY CONTINUES TO
HAVE A NEGATIVE EFFECT ON CULLINAN'S RESULTS.
KARRIMOR INTERNATIONAL
DUE TO A VERY FLAT SEASON IN THE UK OUTDOOR CLOTHING MARKET, KARRIMOR GENERATED
LOSSES FOR THIS PERIOD. THE RESULTS WILL NOT IMPROVE IN THE SECOND HALF YEAR,
AND THEREFORE THE INVESTMENT HAS THUS FAR BEEN BELOW EXPECTATIONS.
DISCONTINUED
AFMIT TOOLS & CULLINAN PRECISION ENGINEERING
IT IS ANTICIPATED THAT THESE TWO BUSINESSES COULD BE SOLD AT A PREMIUM TO BOOK
VALUE IN THE SECOND HALF OF THE YEAR.
FUTURE PROSPECTS
AS THE POOR RESULTS OF SOME OF THE OUTDOOR LIFESTYLE BUSINESSES ARE DISTORTING
THE POSITIVE RESULTS FROM OTHER CULLINAN DIVISIONS, THE BOARD IS CONSIDERING
STRATEGIES TO RESTRUCTURE THE
GROUP AND RECTIFY THIS SITUATION IN THE SECOND HALF OF THIS FINANCIAL YEAR.
ON BEHALF OF THE BOARD
SJ NASH QA SOUTHEY
EXECUTIVE CHAIRMAN FINANCIAL DIRECTOR
9 JUNE 2000
DIRECTORS: SJ NASH (EXECUTIVE CHAIRMAN), QA SOUTHEY (FINANCIAL DIRECTOR), AA
THOMPSON, A VAN DER MERWE
REGISTERED OFFICE AND REGISTRATION NUMBER: 1ST FLOOR, SABLE PLACE, FAIRWAY
OFFICE PARK,
52 GROSVENOR ROAD, BRYANSTON, SANDTON (PO BOX 2412, CRAMERVIEW 2060)
(REGISTRATION NUMBER 1901/001808/06)
TRANSFER SECRETARIES: MERCANTILE REGISTRARS LIMITED
PO BOX 1053, JOHANNESBURG 2000
FOR FURTHER INFORMATION ON GROUP ACTIVITIES, PLEASE WRITE TO: THE GROUP
SECRETARY, CULLINAN HOLDINGS LIMITED PO BOX 2412, CRAMERVIEW 2060
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