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TRANSPACO LIMITED - AUDITED ANNUAL RESULTS FOR THE YEAR 30 JUNE 2000

Release Date: 30/08/2000 16:03
Code(s): TPC
Wrap Text
TRANSPACO LIMITED
REG. NO 1951/00799/06
AUDITED ANNUAL RESULTS FOR THE YEAR 30 JUNE 2000
CONSOLIDATED INCOME STATEMENT

ANNUALISED
12 MONTHS 12 MONTHS 15 MONTHS JUNE 2000 JUNE 1999 JUNE 1999 UNAUDITED
NOTE R '000 R '000 R '000 TURNOVER 238 435 178 200 222 751 OPERATING INCOME 33 625 28 718 35 898 DEPRECIATION 5 530 3 316 4 145 NET FINANCE CHARGES 4 732 3 110 3 888 NET INCOME BEFORE TAXATION 23 363 22 292 27 865 TAXATION 6 795 5 826 7 283 NET INCOME AFTER TAXATION 16 568 16 466 20 582 EXCEPTIONAL ITEM 1 14 468 - -
INCOME ATTRIBUTABLE TO SHAREHOLDERS 31 036 16 466 20 582 DIVIDEND 3 271 2 290 2 290 INCOME FOR THE PERIOD 27 765 14 176 18 292 ADJUSTMENT-PRIOR YEARS 392 - -
RETAINED INCOME FOR THE PERIOD 28 157 14 176 18 292 NO OF ORDINARY SHARES IN
ISSUE (000'S) 32 711 32 711 32 711 EARNINGS PER SHARE (CENTS) 94 50 63
HEADLINE EARNINGS PER SHARE (CENTS) 50 50 63
DIVIDEND PER SHARE (CENTS) 10,0 5,6 7,0
INTERIM 5,0 - -
FINAL 5,0 5,6 7,0
DIVIDEND COVER 5,0 9,0 9,0 NOTE 1 PROFIT ON SALE OF BUBBLE PAC DIVISION CONSOLIDATED BALANCE SHEET
12 MONTHS 15 MONTHS JUNE 2000 JUNE 1999 R '000 R '000 ASSETS
PROPERTY, PLANT AND EQUIPMENT 55 854 41 082 INTANGIBLES 1 184 711
CURRENT ASSETS 85 160 65 553 INVENTORIES 29 665 25 643 ACCOUNTS RECEIVABLE 55 458 39 873 CASH RESOURCES 37 37
TOTAL ASSETS 142 198 107 346 EQUITY AND LIABILITIES
SHAREHOLDERS FUNDS 71 942 43 785 NON-CURRENT LIABILITIES 15 710 8 877 DEFERRED TAXATION 1 728 337
CURRENT LIABILITIES 52 818 54 347 ACCOUNTS PAYABLE 41 208 32 891 BANK OVERDRAFT 9 974 19 166 SHAREHOLDERS FOR DIVIDEND 1 636 L 290 TOTAL EQUITY AND LIABILITIES 142 198 107 346 NET ASSET VALUE PER SHARE (CENTS) 220 134 ABRIDGED CONSOLIDATED CASH FLOW
JUNE 2000 JUNE 1999 R '000 R '000 OPERATING CASH FLOW 48 092 36 020 MOVEMENT IN WORKING CAPITAL (9 285) (16 729) NET INTEREST PAID (4 732) (3 888) TAXATION PAID (9 872) (4 017) DIVIDEND PAID (3 925) - CASH GENERATED FROM
OPERATING ACTIVITIES 20 278 11 386 NET INFLOW FROM FINANCING ACTIVITIES 9 689 9 998 NET FIXED ASSETS ACQUIRED (20 775) (30 461) 9 192 (9 077) OPENING NET CASH RESOURCES (19 129) (10 052) CLOSING NET CASH RESOURCES (9 937) (19 129) STATEMENT OF CHANGES IN EQUITY
JUNE 2000 JUNE 1999 R '000 R '000 OPENING BALANCE 43 785 21 147 EARNINGS ATTRIBUTABLE TO SHAREHOLDERS 31 428 20 582 ISSUE OF SHARE CAPITAL AND SHARE PREMIUM - 4 387 ACCUMULATED LOSS ACQUIRED
ON ACQUISITION OF SUBSIDIARY - (41) DIVIDEND PAID (3 271) (2 290) CLOSING BALANCE 71 942 43 785 NATURE OF BUSINESS
TRANSPACO OPERATES IN THE PLASTIC AND PACKAGING INDUSTRIES, MANUFACTURING AND DISTRIBUTING FROM 10 FACILITIES WITH EMPHASIS IN:
* PACKAGING FOR THE RETAIL, INDUSTRIAL, AGRICULTURAL AND MINING SECTORS * SCHOLASTIC AND OFFICE STATIONERY * PLASTIC RECLAMATION AND RECYCLING * VACUUM FORMING * PLASTIC FABRICATION
* RAW MATERIAL TRADING IN LOCAL AND EXPORT MARKETS REVIEW
THE YEAR TO 30 JUNE 2000 WAS CHARACTERISED BY CONSOLIDATION AND
RATIONALISATION. OPERATING INCOME GREW 17% TO R33,6 MILLION SUPPORTED BY A 34% INCREASE IN SALES TO R238,4 MILLION. HOWEVER, THIS DID NOT TRANSLATE INTO AN INCREASE IN EARNINGS PER SHARE FOR THE FOLLOWING REASONS:
* MARGINS WERE EFFECTED BY SUBSTANTIAL INCREASES IN RAW MATERIAL COSTS RESULTING FROM INFLATED WORLD OIL PRICES AND A DEPRECIATION OF THE RAND. THESE COST INCREASES COULD NOT BE RECOVERED IMMEDIATELY BUT MARGINS WILL CORRECT THEMSELVES AS RAW MATERIAL PRICES STABILISE.
* ONE DIVISION DID NOT MEET PROFIT EXPECTATIONS. REMEDIAL ACTION HAS BEEN TAKEN AND THE DIRECTORS ARE CONFIDENT THAT THIS DIVISION WILL REACH ITS FORECASTS IN THE COMING YEAR.
GROUP INCOME BEFORE TAX AND EXCEPTIONAL ITEM WAS R23,4 MILLION -1999 ANNUALISED R22,3 MILLION- WITH EARNINGS PER SHARE OF 50C FOR THE YEAR -1999 ANNUALISED 50C-.
EFFICIENT WORKING CAPITAL MANAGEMENT AND THE R18 MILLION CASH RECEIVED FROM THE SALE OF BUBBLE PAC HAS RESULTED IN AN IMPROVED CASH POSITION AND A REDUCTION IN THE DEBT EQUITY RATIO FROM 67% TO 42%.
THE NET ASSET VALUE INCREASED BY 86C PER SHARE OF WHICH 42C WAS CONTRIBUTED BY RETAINED INCOME AND 44C BY THE PROFIT ON THE SALE OF THE BUBBLE PAC DIVISION. THE FLEXIBLES DIVISION INVESTED R9,5 MILLION IN ESTABLISHING A NEW PRODUCTION FACILITY. THIS EXPANSION IS REFLECTED IN THE GROUPS BALANCE SHEET WHILST WE HAVE NOT HAD THE BENEFIT OF 12 MONTHS TRADING. PLASTIC AND THE ENVIRONMENT
LITTER HAS BEEN IDENTIFIED AS A MAJOR SOURCE OF CONCERN AND MUST BE ADDRESSED BY ALL SOUTH AFRICANS. THE PROPOSED LEGISLATION PERTAINING TO PLASTIC VEST TYPE CARRIER BAGS IS UNLIKELY TO BE PROMULGATED IN ITS CURRENT FORM. TRANSPACO IS COMMITTED TO A HEALTHY AND CLEAN ENVIRONMENT AND SUPPORTS THE DRIVE TOWARDS A RECYCLING CULTURE. THE GROUP HAS MADE SUBSTANTIAL INVESTMENTS IN EXPANDING SILVERPACK, ITS RECYCLING OPERATION, TO TAKE ADVANTAGE OF THE ANTICIPATED FLOW OF POST CONSUMER WASTE.
THE CO-OPERATION BETWEEN GOVERNMENT, NATIONAL RETAILERS AND THE PLASTIC INDUSTRY WILL CREATE OPPORTUNITIES FOR THE GROUP IN BOTH RECYCLING AND FINISHED GOODS PRODUCTION. PROSPECTS
TERBO PLASTICS -RIGID PVC FOIL- IS CURRENTLY INSTALLING PLANT AND EQUIPMENT TO INCREASE PRODUCTION CAPACITY BY 50%. A R4 MILLION INVESTMENT WILL CATER FOR AN INCREASE IN DEMAND FOR ITS PRODUCT.
FRAMEN -CORE WINDING- INSTALLED ADDITIONAL PLANT UPGRADING ITS EXISTING FACILITIES AND INCREASING CAPACITY.
PLASTAFRICA -FLEXIBLE PLASTIC PACKAGING- HAS ENTERED THE REFUSE BAG MARKET AND HAS INSTALLED THE NECESSARY EQUIPMENT TO MEET DEMAND.
PERANA -INJECTION MOULDING AND VACUUM FORMING- IS CURRENTLY UNDER-UTILISED. IT HAS EMBARKED ON A CONCERTED MARKETING AND SALES DRIVE WHICH SHOULD PROVIDE FUTURE BENEFITS AND GROWTH.
PE RECOVERIES IS EXPECTED TO BENEFIT FROM AN INCREASE IN EXPORT REVENUE FOLLOWING ITS AGGRESSIVE ENTRY INTO THE INTERNATIONAL PLASTIC RAW MATERIAL MARKET.
THE BOARD LOOKS FORWARD WITH ENTHUSIAM, CONFIDENCE AND A RETURN TO GROWTH IN EARNINGS PER SHARE FOR THE YEAR AHEAD. DIVIDEND DECLARATION
NOTICE IS HEREBY GIVEN THAT AN ORDINARY FINAL CASH DIVIDEND OF 5 CENTS PER SHARE HAS BEEN DECLARED PAYABLE ON 6 OCTOBER 2000 TO SHAREHOLDERS REGISTERED IN THE BOOKS OF THE COMPANY AT THE CLOSE OF BUSINESS ON 15 SEPTEMBER 2000. THE TRANSFER BOOKS AND REGISTER OF MEMBERS WILL BE CLOSED FROM 18 SEPTEMBER 2000 TO 29 SEPTEMBER 2000, BOTH DAYS INCLUSIVE. ON BEHALF OF THE BOARD: S ABELHEIM P ABELHEIM
(CHAIRMAN) (CHIEF EXECUTIVE OFFICER) 31 AUGUST 2000
OTHER DIRECTORS: A AARON*, H BOTHA, K BOTHA, C BOUZAGLOU,
D HILEWITZ*, S JACOBSON*, E ROVETTI, A SHUB, C VIDERGAUZ (* NON EXECUTIVE)
DIVISIONAL DIRECTORS: S CHAITEL, S HARMSE, K HARRIS, G HEROLDT, L O'NEILL, C PHINN, A NORRIS, C TAYLOR, J WATTERS COMPANY SECRETARY: SL CHAITEL AUDITORS: ERNST & YOUNG TRANSPACO POSTS SOLID RESULTS THURSDAY, AUGUST 31, 2000
CONSOLIDATION AND RATIONALISATION IN LISTED PLASTIC AND PACKAGING GROUP TRANSPACO LIMITED ("TRANSPACO") PRODUCED A SOLID SET OF RESULTS FOR THE YEAR ENDED 30 JUNE 2000. OPERATING INCOME ROSE 17% TO R33,6 MILLION, SUPPORTED BY A 34% INCREASE IN SALES TO R238,4 MILLION.
HOWEVER, THE EARNINGS GROWTH DID NOT TRANSLATE INTO AN INCREASE IN HEADLINE EARNINGS PER SHARE. BEFORE TAX INCOME GREW 5% TO R23,4 MILLION (1999
ANNUALISED: R22,3 MILLION) EQUATING TO EARNINGS OF 50 CENTS PER SHARE (1999 ANNUALISED: 50 CENTS).
CHIEF EXECUTIVE OFFICER PHIL ABELHEIM EXPLAINS, "OUR OPERATING MARGINS WERE SEVERELY AFFECTED BY SUBSTANTIAL INCREASES IN RAW MATERIAL COSTS AS A RESULT OF THE INFLATED WORLD OIL PRICES AND THE DEPRECIATED VALUE OF THE RAND. ALTHOUGH THESE COST INCREASES COULD NOT BE RECOVERED IMMEDIATELY, THE MARGINS WILL SELF-CORRECT AS RAW MATERIAL PRICES STABILISE. IN ADDITION, ONE OF THE GROUP'S DIVISIONS DID NOT MEET PROFIT EXPECTATIONS, WHICH FURTHER IMPACTED ON EARNINGS. APPROPRIATE REMEDIAL ACTION HAS BEEN TAKEN, PUTTING THE DIVISION BACK ON TRACK TO MEET FORECASTS IN THE COMING YEAR."
WITH REGARD TO THE BALANCE SHEET, ABELHEIM ADVISES THAT EFFICIENT WORKING CAPITAL MANAGEMENT AND THE R18,0 MILLION CASH RECEIVED FROM THE SALE OF BUBBLE PAC HAVE RESULTED IN AN IMPROVED CASH POSITION AND A REDUCTION IN THE GROUP'S DEBT EQUITY RATIO FROM 67% TO 42%. NET ASSET VALUE PER SHARE INCREASED BY 86 CENTS TO 220 CENTS, OF WHICH 42 CENTS WAS CONTRIBUTED BY RETAINED INCOME AND 44 CENTS BY THE BUBBLE PAC TRANSACTION.
COMMENTING ON THE PROPOSED LEGISLATION PERTAINING TO PLASTIC VEST-TYPE CARRIER BAGS, ABELHEIM SAYS, "LITTER HAS BEEN IDENTIFIED AS A MAJOR SOURCE OF CONCERN AND MUST BE ADDRESSED BY ALL SOUTH AFRICANS. WHILE THE PROPOSED LEGISLATION IS NOT LIKELY TO BE PROMULGATED IN ITS CURRENT FORM, TRANSPACO REMAINS COMMITTED TO A HEALTHY AND CLEAN ENVIRONMENT AND SUPPORTS THE DRIVE TOWARDS A RECYCLING CULTURE. WE BELIEVE THAT THE CO-OPERATION BETWEEN GOVERNMENT, NATIONAL RETAILERS AND THE PLASTIC INDUSTRY WILL CREATE OPPORTUNITIES FOR THE GROUP IN BOTH RECYCLING AND FINISHED GOODS PRODUCTION."
TO THIS END, WE HAVE MADE SUBSTANTIAL INVESTMENTS IN UPGRADING OUR RECYCLING OPERATION - SILVERPACK - TO TAKE ADVANTAGE OF THE ANTICIPATED INCREASED FLOW OF POST CONSUMER WASTE."
LOOKING AHEAD, ABELHEIM IS CONFIDENT THAT TRANSPACO IS WELL-POSITIONED TO MEET THE CHALLENGES OF THE FUTURE. HE CITES A NUMBER OF STRENGTHENING INITIATIVES WITHIN THE GROUP'S OPERATIONS, INCLUDING;
* THE INSTALLATION OF PLANT AND EQUIPMENT TO INCREASE PRODUCTION CAPACITY BY 50% AT RIGID PVC FOIL PRODUCER TERBO PLASTICS, DESIGNED TO CATER FOR INCREASED DEMAND;
* THE INSTALLATION OF ADDITIONAL PLANT AT CORE WINDING DIVISION FRAMEN PAPER, EFFECTIVELY UPGRADING THE EXISTING FACILITIES AND INCREASING CAPACITY; * THE ENTRY OF FLEXIBLE PLASTIC PACKAGING OPERATION PLASTAFRICA INTO THE REFUSE BAG MARKET THROUGH THE INSTALLATION OF THE NECESSARY EQUIPMENT; * A CONCERTED MARKETING AND SALES DRIVE AT INJECTION MOULDING AND VACUUM FORMING DIVISION PERANA IN ORDER TO BOOST CAPACITY UTILISATION; AND
* THE AGGRESSIVE ENTRY OF PE RECOVERIES INTO THE INTERNATIONAL PLASTIC RAW MATERIAL MARKET, WHICH IS CERTAIN TO BOOST EXPORT REVENUES.
"WE ARE CONFIDENT OF ACHIEVING REAL GROWTH IN THE YEAR AHEAD," SAYS ABELHEIM. "WE HAVE THE INFRASTRUCTURE, THE PRODUCTION CAPACITY AND THE RESOURCES TO DELIVER. THIS, TOGETHER WITH THE OPTIMISM AND ENTHUSIASM OF OUR PEOPLE, WILL TAKE US FORWARD." ENDS ISSUED BY: MICHELE ANDERSON SASANI COMMUNICATIONS (011) 784 2598 ON BEHALF OF: TRANSPACO CONTACT: PHIL ABELHEIM (011) 887 0430

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