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Shoprite Holdings Limited (Registration No 05/07721/06)
Profit announcement for the 6 months ended 31 December 2000
Growth in operating profit 21,2% Number of outlets: 572 CONSOLIDATED INCOME STATEMENT
Unaudited Unaudited Audited 6 months to % 6 months to 12 months to (R'000) 31/12/00 change 31/12/99 30/06/00 Revenue 9 985 001 6.2 9 403 154 18 430 568 Operating profit before
exceptional items 186 670 21.2 154 056 325 801 Exceptional items 31 296 26 513 33 564 Operating profit after
exceptional items 217 966 20.7 180 569 359 365 Investment income 15 716 42 682 84 891 Finance charges 9 145 34 169 65 192 Profit before taxation 224 537 18.8 189 082 379 064 Taxation 46 161 25.4 36 797 77 768 Profit after taxation 178 376 17.1 152 285 301 296 Outside shareholders'
interest 5 476 3 692 7 370
Net profit 172 900 16.4 148 593 293 926 Headline earnings per
share (cents) 26.1 16.0 22.5 47.9 Earnings per share (cents)
after exceptional items 31.8 16.5 27.3 54.1 Distribution to shareholders
(cents per share) 9.5 11.8 8.5 18.0
Dividend cover (times) 2.7 2.6 2.7 Number of ordinary shares ('000) used for calculation
of earnings per share 543 479 543 479 543 479 CONSOLIDATED BALANCE SHEET
Unaudited Unaudited Audited (R'000) 31/12/00 31/12/99 30/06/00 Non-current assets 1 480 514 1 401 548 1 377 578 Fixed assets 1 397 925 1 267 852 1 294 358 Investments 82 210 133 696 82 841 Deferred taxation 228 709 284 625 258 629 Intangible assets (228 330) (284 625) (258 250) Current assets 4 572 383 4 433 376 3 766 049 Inventories 2 377 754 2 280 040 2 108 873 Accounts receivable 1 424 102 1 261 513 1 120 282 Cash and cash equivalents 770 527 891 823 536 894 Total assets 6 052 897 5 834 924 5 143 627 Ordinary shareholders' funds 1 424 685 1 200 193 1 293 015 Outside shareholders' interest 41 404 28 740 31 777 Non-current liabilities 349 059 467 740 333 392 Interest-bearing debt 21 924 71 349 18 858 Other non-current liabilities 323 198 393 626 310 596 Deferred taxation 3 937 2 765 3 938 Current liabilities 4 237 749 4 138 251 3 485 443 Interest-bearing debt 14 304 27 312 47 651 Other current liabilities 4 223 445 4 110 939 3 437 792 Total equity and liabilities 6 052 897 5 834 924 5 143 627 CONSOLIDATED CASH FLOW STATEMENT
Unaudited Unaudited Audited 6 months to 6 months to 12 months to (R'000) 31/12/00 31/12/99 30/06/00 Cash generated by operations 536 245 866 487 689 402 Net investment income 6 571 5 975 15 904
Dividends received - 2 538 3 795
Dividends paid (51 896) (36 440) (83 012) Cash flow from operations 490 920 838 560 626 089 Investment activities (225 051) (226 560) (562 867) Acquisition of fixed assets (225 514) (234 530) (402 546) Acquisition of subsidiary (9 837) - -
Other investment activities 10 300 7 970 (160 321) Net cash flow 265 869 612 000 63 222
Financing activities (32 236) (250 941) (57 092) Net movement in debt (32 236) (250 941) (57 092) Net movement in cash and cash
equivalents 233 633 361 059 6 130 SEGMENT INFORMATION
Unaudited Unaudited Audited 6 months to 6 months to 12 months to (R'000) 31/12/00 31/12/99 30/06/00 REVENUE - by business segment
- Supermarkets 9 634 627 9 082 927 17 854 702 - Furniture 350 374 320 227 575 866 Total revenue 9 985 001 9 403 154 18 430 568 OPERATING PROFIT - by business segment
- Supermarkets 255 647 224 236 482 416 - Furniture 29 921 19 082 37 483
- Unallocated costs (98 898) (89 262) (194 098) Total operating profit 186 670 154 056 325 801 SUPPLEMENTARY INFORMATION
Unaudited Unaudited Audited 6 months to 6 months to 12 months to (R'000) 31/12/00 31/12/99 30/06/00 1. Depreciation for the period 125 910 104 599 229 691 2. Dividends received
(included ininvestment income) - 2 538 3 795 3. Capital expenditure for the
period 225 514 234 530 402 546 31/12/00 31/12/99 30/06/00 4. Capital commitments 74 134 73 847 109 219 5. Investments: unlisted - at cost and
directors' valuation 82 210 130 425 79 570 listed - at cost - 3 271 3 271 - at market value - 6 284 6 998 6. Contingent liabilities 514 313 452 279 502 645 7. Net asset value per share
(cents) 262 221 238 CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited Audited 6 months to 6 months to 12 months to (R'000) 31/12/00 31/12/99 30/06/00 Balance at 1 July 1 293 015 1 092 100 1 092 100 Movement in foreign currency
translation reserve 10 401 5 696 4 815
Net profit for the period 172 900 148 593 293 926 Dividends provided/paid (51 631) (46 196) (97 826) Balance at 31 December/ 30 June 1 424 685 1 200 193 1 293 015 ACCOUNTING POLICIES
The accounting policies used in the preparation of the interim financial statements are consistent with those used in the annual financial statements for the year ended 30 June 2000, except as indicated below, and conform with Statements of Generally Accepted Accounting Practice in South Africa.
Against the background of a new Statement of Generally Accepted Accounting Practice AC 131 relating to the treatment of goodwill on business acquisitions, the group's new accounting policy is to recognise negative goodwill.
In compliance with the transitional provisions of AC 131 the carrying values of the deferred tax asset and negative goodwill following the acquisition of OK Bazaars during the 1998 financial year, have been restated. Negative goodwill is amortised over the useful lives of the related assets. This change has no effect on profit attributable to ordinary shareholders for the current or prior years, only on the calculation of headline earnings. COMMENTS ON THE RESULTS
1. All the divisions in the group produced satisfactory results during the period under review. These results were achieved despite the restraining effect higher fuel prices and lottery ticket sales had on retail spending.
2. As foreseen, the group managed to increase its retail profit margin from 1,65% to 1,88% as the rationalisation process is now fully in operation. Stock shrinkage throughout the group is still firmly under control.
3. Exceptional items refer mainly to the amortisation of negative goodwill in terms of the accounting policy set out above. This amortisation is being implemented on the lines referred to above.
4. The Share Incentive Trust was financed throughout by outside institutions, thus changing the composition of the net financing income compared to previous reporting periods.
5. Included in taxation is an amount of R29,9 million (1999 - R 26,3 million) representing the utilisation of the deferred tax asset. The taxation that is payable is mainly secondary tax on companies (STC) and tax owing by partnership ventures in the group.
6. The dispute between the group and SAB over the price at which OK Bazaars was acquired, has not yet been finally resolved. Consequently the total amount payable to Shoprite by SAB has not yet been finalised. PROSPECTS
The Board does not foresee an improvement in consumer spending in the second half of the year, but is nevertheless of the opinion that the group will perform satisfactorily. DIVIDEND
It is anticipated that an interim dividend of 9,5 cents (1999 - 8,5 cents) per share will be declared at the end of March 2001. By order of the Board C.H.Wiese J.W.Basson Chairman Managing director 19 February 2001 c/o William Dabs & Old Paarl Roads BRACKENFELL
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