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(REGISTRATION NUMBER 1901/001808/06)
RESULTS FOR THE YEAR ENDED 3O SEPTEMBER 2000
GROUP INCOME STATEMENT
AUDITED AUDITED
YEAR ENDED YEAR ENDED
30 SEPTEMBER 30 SEPTEMBER
2000 1999
R'000 R'000
REVENUE
- CONTINUING OPERATIONS 336 946 301 513
- DISCONTINUED OPERATIONS 185 582 177 460
TOTAL REVENUE 522 528 478 973
OPERATING INCOME BEFORE EXCEPTIONAL
ITEMS
- CONTINUING OPERATIONS (6 086) 3 486
- DISCONTINUED OPERATIONS 4 278 5 173
EXCEPTIONAL ITEMS (1 037) 16 965
OPERATING (LOSS)/INCOME (2 845) 25 624
NET FINANCE (CHARGES)/INCOME (7 015) (7 793)
(LOSS)/INCOME BEFORE TAXATION (9 860) 17 831
TAXATION 1 042 (537)
NET (LOSS)/INCOME AFTER TAXATION (8 818) 17 294
OUTSIDE SHAREHOLDERS' PORTION OF LOSSES 2 025 834
(LOSS)/INCOME ATTRIBUTABLE TO
ORDINARY SHAREHOLDERS (6 793) 18 128
ATTRIBUTABLE (LOSS)/INCOME PER SHARE (CENTS) (0,9) 2,5
HEADLINE (LOSS)/INCOME PER SHARE (CENTS) (0,8) 0,2
STATEMENTS OF CHANGES IN EQUITY
AUDITED AUDITED
YEAR ENDED YEAR ENDED
30 SEPTEMBER 30 SEPTEMBER
2000 1999
R'000 R'000
ORDINARY SHARE CAPITAL
BALANCE AT THE BEGINNING OF THE YEAR 7 346 7 298
ISSUED DURING THE PERIOD - 48
BALANCE AT THE END OF THE YEAR 7 346 7 346
SHARE PREMIUM
BALANCE AT THE BEGINNING OF THE YEAR 60 865 130 509
WRITE-OFF OF INTANGIBLES - (69 644)
BALANCE AT THE END OF THE YEAR 60 865 60 865
REVALUATION RESERVE
BALANCE AT THE BEGINNING OF THE YEAR 232 461
DEFICIT ARISING ON REVALUATION - (119)
TRANSFER TO DISTRIBUTABLE RESERVES
ON DISPOSAL - (110)
BALANCE AT THE END OF THE YEAR 232 232
SHARE CAPITAL REDUCTION RESERVE FUND
BALANCE AT THE BEGINNING OF THE YEAR 20 876 20 876
BALANCE AT THE END OF THE YEAR 20 876 20 876
CAPITAL REDEMPTION RESERVE FUND
BALANCE AT THE BEGINNING OF THE YEAR 4 4
BALANCE AT THE END OF THE YEAR 4 4
ACCUMULATED LOSS
BALANCE AT THE BEGINNING OF THE YEAR (45 641) (63 879)
ATTRIBUTABLE (LOSS)/INCOME FOR THE YEAR (6 793) 18 128
TRANSFER FROM REVALUATION RESERVE - 110
BALANCE AT THE END OF THE YEAR (52 434) (45 641)
ORDINARY SHAREHOLDERS' EQUITY 36 889 43 682
GROUP BALANCE SHEET
AUDITED AUDITED
YEAR ENDED YEAR ENDED
30 SEPTEMBER 30 SEPTEMBER
2000 1999
R'000 R'000
ASSETS
FIXED ASSETS 56 998 58 789
GOODWILL 10 400 -
CURRENT ASSETS 341 755 363 652
- INVENTORIES 99 961 104 379
- ACCOUNTS RECEIVABLE 128 953 154 694
- CASH RESOURCES 112 841 104 579
TOTAL ASSETS 409 153 422 441
EQUITY AND LIABILITIES
ORDINARY SHAREHOLDERS' EQUITY 36 889 43 682
OUTSIDE SHAREHOLDERS' INTEREST 7 386 1 539
INTEREST BEARING TERM LOANS 64 676 61 283
- PREFERENCE SHARE CAPITAL 46 046 46 046
- LONG-TERM LOANS 11 805 12 357
- SHORT-TERM LOANS 6 825 2 880
CURRENT LIABILITIES 300 202 315 937
- ACCOUNTS PAYABLE 182 174 197 485
- RECEIVER OF REVENUE 599 1 565
- PREFERENCE DIVIDENDS 1 293 22
- BANK OVERDRAFTS 116 136 116 865
TOTAL EQUITY AND LIABILITIES 409 153 422 441
GROUP CASH FLOW STATEMENT
AUDITED AUDITED
YEAR ENDED YEAR ENDED
30 SEPTEMBER 30 SEPTEMBER
2000 1999
R'000 R'000
CASH FLOW FROM OPERATING ACTIVITIES
CASH GENERATED/(UTILISED) BY OPERATIONS 16 441 (61 165)
INTEREST (PAID)/RECEIVED (2 282) (3 491)
PREFERENCE DIVIDENDS PAID (3 462) (4 773)
NORMAL TAXATION REFUND 1 609 -
SECONDARY TAXATION ON COMPANIES (1 533) (791)
NET CASH INFLOW/(OUTFLOW) FROM OPERATING
ACTIVITIES 10 773 (70 220)
CASH FLOW FROM INVESTING ACTIVITIES
ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT (20 224) (11 244)
ACQUISITION OF BUSINESSES (5 367) (70 677)
PROCEEDS ON DISPOSAL OF PROPERTY, PLANT
AND EQUIPMENT 7 945 4 735
PROCEEDS ON REDUCTION OF INTEREST
IN SUBSIDIARY 6 045 -
AMOUNT (PAID)/RECEIVED ON DISPOSAL
OF BUSINESSES (665) 39 578
NET CASH OUTFLOW FROM INVESTING ACTIVITIES (12 266) (37 608)
CASH FLOW FROM FINANCING ACTIVITIES
PROCEEDS ON ISSUE OF PREFERENCE SHARES 25 000
INTEREST BEARING TERM LOANS RAISED 3 393 13 048
OUTSIDE SHAREHOLDERS' FUNDING 7 091 6 049
NET CASH INFLOW FROM FINANCING ACTIVITIES 10 484 44 097
NET INCREASE IN CASH AND CASH EQUIVALENTS 8 991 (63 731)
CASH AND CASH EQUIVALENTS
AT BEGINNING OF PERIOD (12 286) 51 445
AT END OF PERIOD (3 295) (12 286)
COMMENTS
ALTHOUGH THE GROUP RESULTS HAVE BEEN POOR, THEY AGAIN ARE MADE UP OF A
COMBINATION OF GOOD RETURNS ON TOURISM & TRAVEL, HEAVY LOSSES FROM OUTDOOR
LIFESTYLE, AND A HIGH FINANCE COST BURDEN. THESE RESULTS ARE HIGHLIGHTED BY THE
DIVISIONAL BREAKDOWN AS SHOWN BELOW:
OPERATING PROFIT/(LOSS)
DIVISIONAL RESULTS
R'000 CONTINUING DISCONTINUED
TOURISM & TRAVEL 10 862 -
OUTDOOR LIFESTYLE (15 047) 6 641
CORPORATE/OTHER (1 901) (2 363)
(6 086) 4 278
THE NET RESULT HAS BEEN A STRAINED BALANCE SHEET, AND THEREFORE, DURING THE
PAST MONTHS, VARIOUS STRATEGIC DECISIONS HAVE BEEN TAKEN TO ADDRESS THESE
ISSUES.
- IT HAS BEEN DECIDED TO FOCUS THE BUSINESS OF CULLINAN HOLDINGS ON TOURISM &
TRAVEL AND THEREFORE, AT THE OPPORTUNE TIME, THE OUTDOOR LIFESTYLE BUSINESSES
WILL BE SOLD.
- EXTERNAL INVESTORS HAVE INJECTED FUNDS INTO KARRIMOR INTERNATIONAL LIMITED
WITH A CONSEQUENT REDUCTION IN THE CULLINAN HOLDINGS SHAREHOLDING.
- THE BUSINESS OF MIDMACOR HAS BEEN SOLD WITH EFFECT FROM 1 JANUARY 2001. THE
NET RESULT WILL BE A SUBSTANTIAL CASH INFLOW IN THE FIRST QUARTER OF 2001.
- THE DISPOSAL PROGRAMME OF THE REMAINING DISCONTINUED BUSINESSES WILL REMAIN
A PRIORITY.
DIVISIONAL COMMENTARY
TOURISM & TRAVEL
BOTH THE THOMPSONS INBOUND AND OUTBOUND DIVISIONS PRODUCED GOOD RESULTS, AND
PENTRAVEL IMPROVED ITS RESULTS FROM THOSE OF THE PREVIOUS YEAR. DURING THE YEAR
THOMPSONS INBOUND ACQUIRED MAJORITY CONTROL OF GATEWAY AFRICA, AN INBOUND TOUR
OPERATOR BASED IN SINGAPORE. PENTRAVEL, HAVING HAD A YEAR OF CONSOLIDATION, HAS
NOW COMMENCED AN EXPANSION PROGRAMME, AND WILL OPEN FOUR NEW BRANCHES IN THE
COMING FINANCIAL YEAR.
CULLINAN BUSINESS SYSTEMS
CBS HAS INSTALLED A COMPREHENSIVE COMMUNICATIONS NETWORK THROUGHOUT THE TOURISM
GROUP AND SUCCESSFULLY ESTABLISHED AN INTERNET TRAVEL BUSINESS AT THOMPSONS.
OUTDOOR LIFESTYLE
CADAC GROUP
ALL OF THE SENIOR MANAGEMENT OF CADAC WAS CHANGED DURING THE YEAR. HOWEVER, AS
A CONSEQUENCE OF A FLAT LOCAL CONSUMER MARKET, TOGETHER WITH THE PREVIOUS POOR
OPERATIONAL MANAGEMENT, THE FINANCIAL RESULTS HAVE BEEN UNACCEPTABLE. AS THE
FUTURE OF CADAC IS DEPENDANT ON GAINING EXPORT MARKET PENETRATION, ACCEPTABLE
RETURNS WILL ONLY BE REALISED FROM THEIR HIGH ASSET BASE OVER THE NEXT THREE
YEARS.
KARRIMOR INTERNATIONAL LIMITED
ALTHOUGH KARRIMOR SUCCESSFULLY LAUNCHED NEW PRODUCT RANGES IN RUCKSACKS,
FOOTWEAR AND CLOTHING, EXTRA COMPETITION IN THE UK RESULTED IN LOWER SALES AND
MARGINS THAN EXPECTED AND A RESULTANT SMALL LOSS.
DISCONTINUED OPERATIONS
AFMIT TOOLS IS IN THE PROCESS OF BEING RATIONALISED AND SOLD, AND AS MENTIONED
ABOVE MIDMACOR HAS BEEN SOLD.
CULLINAN PRECISION ENGINEERING WAS SOLD DURING THE YEAR FOR A PROFIT ON THE NET
BOOK VALUE.
EXCEPTIONAL ITEMS
THE MAJOR ITEMS ARE MADE UP AS FOLLOWS:
R'000
PROFIT ON DISPOSAL OF SUBSIDIARIES 3 022
PROFIT ON DISPOSAL OF PORTION OF INVESTMENT 3 791
RESTRUCTURING COSTS (5 734)
AMORTISATION OF GOODWILL (549)
FOREIGN EXCHANGE TRANSLATION LOSSES (416)
ACQUISITION COSTS (334)
OTHER (817)
(1 037)
BALANCE SHEET
THE REQUIREMENT TO PAY THE THOMPSONS VENDORS, THE CAPITAL EXPENDITURE PROGRAMME
AT CBS AND CADAC, AND THE HIGH FINANCING COSTS HAVE PUT PRESSURE ON THE GEARING
RATIO. THE RESTRUCTURE AT KARRIMOR INTERNATIONAL LIMITED, THE SALE OF MIDMACOR
AND THE DISPOSAL OF AFMIT WILL TRANSFORM THE CULLINAN HOLDINGS BALANCE SHEET,
AND GEARING LEVELS WILL SUBSTANTIALLY IMPROVE BY THE END OF THE 2001 FINANCIAL
YEAR.
DILUTION OF INTEREST IN KARRIMOR INTERNATIONAL LIMITED (KIL)
CULLINAN HOLDINGS (UK) LIMITED (CULLINAN UK) ENTERED INTO AN AGREEMENT ON 21
SEPTEMBER 2000 WHEREBY SHARES IN KIL WERE SOLD, NEW SHARES IN KIL WERE ISSUED
AND ADDITIONAL LOAN FUNDS WERE INVESTED IN KIL.
THE NET AFFECT OF THIS TRANSACTION WAS TO INJECT GBP2,0 MILLION INTO KIL VIA
SHARE CAPITAL AND LOAN ACCOUNT. CULLINAN UK'S INTEREST IN KIL HAS BEEN REDUCED
FROM 100% TO 67%. CULLINAN UK SOLD SHARES FOR A NET CONSIDERATION OF GBP258
000 WHICH WAS RE-INVESTED AS A LOAN.
KIL IS A LEADING EUROPEAN DESIGNER AND DISTRIBUTOR OF TECHNICAL RUCKSACKS,
OUTDOOR CLOTHING, FOOTWEAR AND RELATED ACCESSORIES. THE NEW INVESTORS, IN
ADDITION TO PROVIDING THE REQUIRED CAPITAL, HAVE STRONG TIES IN BOTH THE SUPPLY
AND DISTRIBUTION SIDE OF THE KIL BUSINESS.
THE EFFECT OF THIS TRANSACTION ON THE EARNINGS PER SHARE FOR THE 12 MONTHS TO
30 SEPTEMBER 2000, HAS BEEN IMMATERIAL.
ON BEHALF OF THE BOARD
SJ NASH QA SOUTHEY
EXECUTIVE CHAIRMAN FINANCIAL DIRECTOR
20 DECEMBER 2000
DIRECTORS: SJ NASH (EXECUTIVE CHAIRMAN), QA SOUTHEY (FINANCIAL DIRECTOR), AA
THOMPSON, AP VAN DER MERWE
REGISTERED OFFICE AND REGISTRATION NUMBER TRANSFER SECRETARIES
1ST FLOOR, SABLE PLACE MERCANTILE REGISTRARS LIMITED
52 GROVENOR ROAD 8TH FLOOR, 11 DIAGONAL STREET
BRYANSTON, SANDTON, 2196 JOHANNESBURG, 2001
(REGISTRATION NUMBER 1901/001808/06) 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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