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GROUP FIVE LIMITED
REGISTRATION NUMBER 1969/000032/06
ANNUAL FINANCIAL RESULTS FOR THE PERIOD 1 JULY 1999 TO 30 JUNE 2000
GROUP INCOME STATEMENT (R'000)
AUDITED
YEAR ENDED 30 JUNE
2000 1999
REVENUE 2,863,410 2,673,434
OPERATING PROFIT 50,101 94,819
FINANCE COSTS (8,231) (12,084)
PROFIT BEFORE TAXATION 41,870 82,735
TAXATION (10,675) (19,777)
PROFIT AFTER TAXATION 31,195 62,958
MINORITY INTEREST (205) (1,014)
ATTRIBUTABLE PROFIT 30,990 61,944
DIVIDENDS (10,301) (17,658)
RETAINED PROFIT FOR THE YEAR 20,689 44,286
OPERATING PROFIT IS STATED AFTER CREDITING:
ATTRIBUTABLE PROFIT
BEFORE TAX OF ASSOCIATES AND AFTER CHARGING: 5,817 13,210
DEPRECIATION AND
AMORTISATION 66,260 67,198
ABRIDGED GROUP BALANCE SHEET (R'000)
AUDITED
30 JUNE 30 JUNE
2000 1999
ASSETS
NON-CURRENT ASSETS
FIXED ASSETS 354,265 359,746
INVESTMENTS IN ASSOCIATES 46,123 45,127
OTHER FINANCIAL ASSETS 59,941 40,467
460,329 445,340
CURRENT ASSETS
BANK BALANCES & CASH 171,299 172,106
OTHER CURRENT ASSETS 975,693 857,586
1,146,992 1,029,692
TOTAL ASSETS 1,607,321 1,475,032
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
ORDINARY SHAREHOLDERS' INTEREST 468,070 452,243
MINORITY INTEREST 1,228 5,182
469,298 457,425
NON-CURRENT LIABILITIES
INTEREST BEARING BORROWINGS 9,205 6,794
DEFERRED TAXATION 4,641 10,003
13,846 16,797
CURRENT LIABILITIES
ACCOUNTS PAYABLE 909,029 869,770
INTEREST-BEARING DEBT 211,694 120,634
SHAREHOLDERS FOR DIVIDEND 3,454 10,406
1,124,177 1,000,810
TOTAL EQUITY AND LIABILITIES 1,607,321 1,475,032
SUMMARISED CASH FLOW STATEMENT (R'000)
CASH FLOW FROM OPERATING ACTIVITIES
CASH FROM OPERATIONS 109,861 134,766
WORKING CAPITAL CHANGES (83,402) (11,555)
CASH GENERATED FROM OPERATIONS 26,459 123,211
FINANCE COST (8,231) (12,084)
TAXATION AND DIVIDENDS PAID (26,855) (45,385)
NET CASH FROM OPERATING
ACTIVITIES (8,627) 65,742
FIXED ASSETS (NET) (58,283) (52,206)
INVESTMENT (NET) (27,369) 3,772
FINANCING ACTIVITIES 56,507 (12,874)
NET DECREASE IN CASH
EQUIVALENTS (37,772) 4,434
INVESTMENTS
UNLISTED SHARES AT COST AND
DIRECTORS' VALUATION 59,941 40,467
CAPITAL EXPENDITURE FOR THE YEAR 85,068 96,904
CAPITAL EXPENDITURE COMMITTED OR AUTHORISED 112,473 96,210
STATISTICS
NUMBER OF ORDINARY SHARES IN ISSUE 73 573 023 73 573 023
EARNINGS PER SHARE - CENTS 42.1 84.2
DIVIDEND COVER 3.0 3.5
DIVIDENDS PER SHARE -
CENTS 14.0 24.0
INTERIM 9.0 9.0
FINAL 5.0 15.0
NET ASSET VALUE PER SHARE - CENTS 636.2 614.7
CURRENT RATIO 1.0 1.0
GROUP FIVE HOLDINGS LIMITED
REGISTRATION NUMBER 1988/000321/06
AUDITED
GROUP INCOME STATEMENT (R'000) YEAR ENDED 30 JUNE
2000 1999
REVENUE 2,863,410 2,673,434
OPERATING PROFIT 50,101 94,819
FINANCE COSTS (8,231) (12,084)
PROFIT BEFORE TAXATION 41,870 82,735
TAXATION (10,675) (19,777)
PROFIT AFTER TAXATION 31,195 62,958
MINORITY INTEREST (21,699) (43,976)
ATTRIBUTABLE PROFIT 9,496 18,982
DIVIDENDS (3,221) (5,292)
RETAINED PROFIT FOR THE YEAR 6,275 13,690
OPERATING PROFIT IS STATED AFTER CREDITING:
ATTRIBUTABLE PROFIT BEFORE TAX OF ASSOCIATES 5,817 13,210
AND AFTER CHARGING:
DEPRECIATION AND AMORTISATION 66,260 67,198
ABRIDGED GROUP BALANCE SHEET
AUDITED
30 JUNE 30 JUNE
2000 1999
ASSETS
NON-CURRENT ASSETS
FIXED ASSETS 354,265 359,746
INVESTMENTS IN ASSOCIATES 46,123 45,127
OTHER FINANCIAL ASSETS 59,941 40,467
460,329 445,340
CURRENT ASSETS
BANK BALANCES & CASH 171,299 172,106
OTHER CURRENT ASSETS 977,104 861,139
1,148,403 1,033,245
TOTAL ASSETS 1,608,732 1,478,585
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
ORDINARY SHAREHOLDERS' INTEREST 143,536 138,748
MINORITY INTEREST 326,024 319,008
469,560 457,756
NON-CURRENT LIABILITIES
INTEREST BEARING BORROWINGS 9,205 6,794
DEFERRED TAXATION 4,641 10,003
13,846 16,797
CURRENT LIABILITIES
ACCOUNTS PAYABLE 912,482 880,177
INTEREST-BEARING DEBT 211,694 120,634
SHAREHOLDERS FOR DIVIDEND 1,150 3,221
1,125,326 1,004,032
TOTAL EQUITY AND LIABILITIES 1,608,732 1,478,585
INVESTMENTS
UNLISTED SHARES AT COST AND DIRECTORS'
VALUATION 59,941 40,467
CAPITAL EXPENDITURE FOR THE YEAR 85,068 96,904
CAPITAL EXPENDITURE COMMITTED OR AUTHORISED 112,473 96,210
STATISTICS
NUMBER OF ORDINARY SHARES IN ISSUE 23 007 545 23 007 545
EARNINGS PER SHARE - CENTS 41.3 82.5
DIVIDEND COVER 2.9 3.6
DIVIDENDS PER SHARE -
CENTS 14.0 23.0
INTERIM 9.0 9.0
FINAL 5.0 4.0
NET ASSET VALUE PER SHARE - CENTS 623.9 603.0
SM GOLDSTEIN LIMITED
REGISTRATION NUMBER 1948/029557/06
GROUP INCOME STATEMENT (R'000)
AUDITED
YEAR ENDED 30 JUNE
2000 1999
SHARE OF ASSOCIATE'S PROFIT BEFORE TAXATION 5,677 10,547
SHARE OF ASSOCIATE'S TAXATION (1,385) (1,964)
ATTRIBUTABLE PROFIT 4,292 8,583
DIVIDENDS (1,399) (2,299)
RETAINED PROFIT FOR THE YEAR 2,893 6,284
ABRIDGED GROUP BALANCE SHEET (R'000)
AUDITED
30 JUNE 30 JUNE
2000 1999
ASSETS
NON-CURRENT ASSETS
INVESTMENT IN ASSOCIATE 71,377 69,218
CURRENT ASSETS
OTHER CURRENT ASSETS 1,109 1,945
TOTAL ASSETS 72,486 71,163
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
ORDINARY SHAREHOLDERS' INTEREST 71,930 69,708
CURRENT LIABILITIES
ACCOUNTS PAYABLE 56 56
SHAREHOLDERS FOR DIVIDEND 500 1,399
556 1,455
TOTAL EQUITY AND LIABILITIES 72,486 71,163
STATISTICS
NUMBER OF ORDINARY SHARES IN ISSUE 9 995 000 9 995 000
EARNINGS PER SHARE - CENTS 42.9 85.9
DIVIDEND COVER 3.1 3.7
DIVIDENDS PER SHARE -
CENTS 14.0 23.0
INTERIM 9.0 9.0
FINAL 5.0 14.0
NET ASSET VALUE PER SHARE - CENTS 719.7 697.4
COMMENTS
(GROUP FIVE LIMITED, GROUP FIVE HOLDINGS LIMITED AND SM GOLDSTEIN LIMITED)
ALTHOUGH TURNOVER GREW BY 7% TO R2.86 BILLION, EARNINGS PER SHARE DECLINED BY
50% FROM 84.2 CENTS PER SHARE TO 42.1 CENTS PER SHARE.
THE MAIN CAUSE OF THIS DECLINE WAS THE DISAPPOINTING RESULT OF ENGINEERING
FOLLOWING A SUBSTANTIAL ONE-OFF PROJECT LOSS.
EARNINGS FROM THE GROUP'S MANUFACTURING ACTIVITIES, WHILE BEING CONSIDERABLY
BETTER THAN THE PRIOR YEAR, DID NOT MEET EXPECTATIONS DUE TO THE DETERIORATION
IN MARKET CONDITIONS DURING THE LAST SIX MONTHS.
WHILE BOTH ROADS AND CIVILS PERFORMED IN LINE WITH EXPECTATIONS, ACTUAL PROFITS
WERE SIGNIFICANTLY DOWN ON THE PRIOR YEAR, REFLECTING THE LACK OF
INFRASTRUCTURAL PROJECTS IN THE COUNTRY. IN CONTRAST, THE BUILDING ACTIVITIES,
TOGETHER WITH PROJECT DEVELOPMENT SERVICES, SHOWED AN IMPROVEMENT IN
PROFITABILITY OFF THE BACK OF A GROWING QUALITY ORDER BOOK.
THE GROUP'S CASH RESOURCES REDUCED BY APPROXIMATELY R90M MAINLY BECAUSE OF
PLANNED EXPENDITURE ON THE DEVELOPMENT AND CONSTRUCTION OF NEW OFFICES FOR
ABN-AMRO BANK AND DEUTSCHE BANK SECURITIES, ADJACENT TO THE NEW JOHANNESBURG
STOCK EXCHANGE. IN ADDITION, THE GROUP'S SHAREHOLDING IN INTERTOLL WAS
INCREASED AND AN INVESTMENT WAS MADE IN A BOT CONCESSION ON A TOLL BRIDGE IN
DELHI, INDIA.
THE GROUP BALANCE SHEET REMAINS STRONG WITH CAPITAL AND RESERVES EDGING TOWARD
THE HALF A BILLION RAND MARK. GROWTH IN CURRENT ASSETS RESULTED LARGELY FROM
THE ABOVE MENTIONED PROPERTY DEVELOPMENTS.
THE DISAPPOINTING RESULTS OF THE PAST YEAR, TOGETHER WITH THE ASSUMPTION THAT
MARKET CONDITIONS WILL NOT IMPROVE SIGNIFICANTLY OVER THE NEXT YEAR,
HIGHLIGHTED THE NEED TO RADICALLY REVIEW THE ORGANISATION'S STRATEGIES AND
MANAGEMENT STRUCTURES RESULTING IN SOME BOLD AND EXCITING CHANGES THROUGHOUT
THE OPERATIONS.
THE CHALLENGE OF CREATING REAL SHAREHOLDER VALUE AND CONSISTENT PROFIT GROWTH
IS BEING MET THROUGH NEW STRATEGIES AIMED AT GROWING THE CORE BUSINESSES IN THE
BUILDING, CONSTRUCTION, ENGINEERING, AND OPERATIONS AND MAINTENANCE MARKETS,
AND COMPLETELY REFOCUSING THE MANUFACTURING OPERATIONS.
PROSPECTS
THE EXPECTED UPTURN IN THE CONSTRUCTION INDUSTRY HAS NOT YET MATERIALISED
ALTHOUGH THERE ARE SOME INDICATIONS THAT AN IMPROVEMENT IN THE LEVEL OF
BUSINESS ACTIVITY WITHIN THE COUNTRY IS IMMINENT. THE GROUP THUS CONTINUES TO
PURSUE OPPORTUNITIES NOT ONLY IN SOUTH AFRICA BUT ALSO IN SELECTED OUTSIDE
COUNTRIES WHERE INTERNATIONAL AID AGENCIES ARE FUNDING INFRASTRUCTURAL
INITIATIVES.
GIVEN THE POSITIVE EFFECT THAT THE CURRENT GROUP STRUCTURAL CHANGES ARE HAVING
ON BOTH PROFITABILITY AND CASH MANAGEMENT, AND WITH A SECURED ORDER BOOK IN
EXCESS OF R2.2 BILLION, BOTH EARNINGS AND CASH FLOW SHOULD IMPROVE MARKEDLY.
DIVIDEND DECLARATION BY GROUP FIVE LIMITED, GROUP FIVE HOLDINGS LIMITED AND SM
GOLDSTEIN LIMITED
THE DIRECTORS HAVE DECLARED A FINAL DIVIDEND OF 5 CENTS PER GROUP FIVE LIMITED
ORDINARY SHARE, GROUP FIVE 'N' ORDINARY SHARE, GROUP FIVE HOLDINGS LIMITED
ORDINARY SHARE, AND SM GOLDSTEIN LIMITED ORDINARY SHARE. THE DIVIDENDS ARE
PAYABLE TO SHAREHOLDERS REGISTERED IN THE BOOKS OF THE COMPANIES AT THE CLOSE
OF BUSINESS ON 22 SEPTEMBER 2000. DIVIDEND CHEQUES WILL BE POSTED TO
SHAREHOLDERS ON OR ABOUT 6 OCTOBER 2000.
NOTE:
MEMBERS ARE REMINDED THAT ENTITLEMENTS OF LESS THAN R5.00 WILL BE DONATED TO
CHARITY.
ON BEHALF OF THE BOARD
MH LOMAS HC TURNER
24 AUGUST 2000
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