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Bell Equipment Ltd
(Incorporated in the Republic of South Africa)
(JSE Share code: BEL ISIN ZAE000028304)
(Registration number 1968/013656/06)
("Bell")
2001 AUDITED RESULTS
for the year ended 31 December 2001
* Revenue up 15,3%
* Profit after tax up 21,6%
* Net Asset Value Per Share up 33,6%
Consolidated Income Statement
For year ended
31 December 31 December
R'000 2001 2000
Revenue 1 658 096 1 438 507
Cost of sales 1 228 425 1 032 289
Gross profit 429 671 406 218
Other operating income 51 269 52 742
Distribution costs (220 809) (232 688)
Administration expenses (90 931) (69 866)
Other operating expenses (33 996) (38 477)
Profit from operating activities 135 204 117 929
Net finance costs (Note 2) 475 11 538
Profit before taxation (Note 3) 134 729 106 391
Taxation 35 850 25 077
Profit after taxation 98 879 81 314
Number of shares in issue ('000) 93 837 93 634
Weighted average number of
shares in issue ('000) 93 750 93 429
Earnings per share/ Headline earnings
per share (basic) (cents) (Note 4) 105 87
Earnings per share/ Headline earnings
per share (diluted) (cents) (Note 4) 104 86
Dividend per share (cents) 10 10
Consolidated Balance Sheet
At At
31 December 31 December
R'000 2001 2000
ASSETS
Non-current assets 160 146 115 584
Property, plant and equipment 139 063 102 892
Investments and long-term receivables 21 083 12 692
Current assets 1 010 308 784 825
Inventory 635 838 513 638
Trade and other receivables 295 478 236 248
Current portion of
long-term receivables 12 119 -
Prepayments 35 180 3 627
Taxation 1 871 3 053
Cash resources 29 822 28 259
Total assets 1 170 454 900 409
EQUITY AND LIABILITIES
Capital and reserves 664 129 496 689
Stated capital (Note 5) 223 355 222 822
Non-distributable reserves 126 000 48 458
Retained earnings 314 774 225 409
Non-current liabilities 38 540 36 411
Long-term borrowings 25 774 31 700
Deferred taxation 12 766 4 711
Current liabilities 467 785 367 309
Trade and other payables 297 027 206 254
Current portion of long-term borrowings 5 811 1 915
Warranty provision 23 308 25 407
Taxation 19 461 33 702
Short-term interest bearing debt 122 178 100 031
Total equity and liabilities 1 170 454 900 409
Net asset value per share (cents) 708 530
Abbreviated Cash Flow Statement
For year ended
31 December 31 December
R'000 2001 2000
Operating profit before working
capital changes 221 226 172 957
Cash invested in working capital (122 210) (164 860)
Net cash generated from operation 99 016 8 097
Net finance costs (3 530) (14 079)
Taxation paid (41 268) (4 955)
Net cash flow from/(applied to)
operating activities 54 218 (10 937)
Dividend paid (9 364) (5 595)
Invested in property, plant,
equipment, investments
and long-term receivables (66 996) (40 783)
Net cash outflow (22 142) (57 315)
Proceeds from shares issued 533 1 061
Net increase in borrowings 21 609 56 254
Cash deficit funded 22 142 57 315
Statement of Changes in Equity
For year ended
31 December 31 December
R'000 2001 2000
Equity at the beginning of the year 496 689 397 202
Changes in share capital 533 1 061
Issue of share capital 533 1 061
Changes in non-distributable reserves 77 542 17 144
Deferred tax on revaluation
of properties - (3 432)
Increase in legal reserve of
foreign subsidiary 150 32
Increase in currency
translation reserve 79 689 20 655
Exchange differences on
foreign reserves (2 297) (111)
Changes in retained earnings 89 365 81 282
Net profit for the year 98 879 81 314
Transfer to legal reserve of
foreign subsidiary (150) (32)
Dividend (9 364) -
Equity at end of year 664 129 496 689
Abbreviated Notes To Audited Results
For year ended
31 December 31 December
R'000 2001 2000
1. ACCOUNTING POLICIES
The principal accounting policies have been consistently followed in all
material respects with those of the previous year.
The group annual financial statements have been prepared in compliance with
the South African Statements of Generally Accepted Accounting Practice
and the requirements of the Companies Act 1973, as amended.
The annual financial statements are compiled in accordance with the
historical cost basis, adjusted for the revaluation of freehold property.
2. NET FINANCE COSTS
Net interest paid 7 740 7 684
Net currency exchange (gains)/losses (4 210) 6 395
Net finance costs paid 3 530 14 079
Financial instrument income 3 055 2 541
Net finance costs 475 11 538
3. PROFIT BEFORE TAXATION
Profit before taxation is arrived at
after taking into account:
Income
Export incentives 23 912 35 900
Net surplus on disposal of property,
plant and equipment 425 -
Expenditure
Depreciation of property, plant and
equipment 13 706 9 411
Operating lease charges
- equipment and motor vehicles 7 808 9 464
- properties 8 498 7 724
Staff costs 259 972 244 694
Net (decrease)/increase
in warranty provision 2 099 25 407
4. EARNINGS PER SHARE
The calculation of earnings per share is based on profit after taxation and
the weighted average number of ordinary shares in issue during the year.
The weighted average number of shares in issue for the year under review was
93 749 879 (2000: 93 429 484).
On a diluted basis, the fully converted weighted average number of shares is
94 882 229 (2000: 94 769 134).
5. STATED CAPITAL
Authorised
100 000 000 (2000: 100 000 000) ordinary
shares of no par value
Issued
93 837 000 (2000: 93 634 200) ordinary
shares of no par value 223 355 222 822
6. CAPITAL EXPENDITURE
Authorised, but not contracted 17 842 31 207
7. SEGMENTAL ANALYSIS
Geographical segments
The group operates in two principal
geographical areas
Operating
R'000 Revenue profit Assets Liabilities
2001
South Africa 927 452 117 812 853 065 292 857
Rest of world 730 644 17 392 317 389 213 468
Total 1 658 096 135 204 1 170 454 506 325
2000
South Africa 721 169 103 914 585 055 233 672
Rest of world 717 338 14 015 315 354 170 048
Total 1 438 507 117 929 900 409 403 720
8. CONTINGENT LIABILITY
As previously reported, an action has been instituted against a
subsidiary of the company for a substantial amount. The action is being
defended and the view of the company's legal advisers is that the company
has good grounds for successfully opposing the claims. After consideration
and based on this legal advice the Board is satisfied that the company will
not suffer any material loss.
Commentary on the results
For the third year in succession, I am proud to report on record turnover,
profitability and increased shareholder funds. After tax profits for 2001
are R98,9 million as compared with R81,3 million in 2000. More importantly,
shareholders' funds have increased from a net asset value of 530 cents per
share to 708 cents per share over the 12 months ended 31 December 2001, this
after paying a 10 cent per share dividend in April of last year. Combining
after-tax profits and the net increase in foreign exchange gains generates
annual earnings of R176,3 million, a 73% increase over last year's
comparable result. The net foreign exchange gains of R77,4 million
highlights to shareholders Bell's true asset-based Rand hedge value. The
unrealised gain on translation into South African Rand of the net worth of
the group foreign subsidiaries added 85 cents in net asset value per share
for the year under review. Over and above this we continued to enjoy a gross
margin of 25% despite fierce competition in stagnant world-wide markets. Our
strong gross profit is due to the favourable Rand cost of our exports and
our local competitors being forced to import and price their product in hard
currency.
The group's working capital, in particular inventory, continues to remain
at higher levels than budgeted with inventory 24% higher than at 31 December
2000. The year-on-year weighted average Rand/Dollar/Euro rate moved up by
23%. The increase in inventory allowed us to have product available to
satisfy unforecasted sales contributing to our sales exceeding budget by 8%.
Net cash generated from operations in 2001 was R99 million versus R8 million
in 2000. After investing and financing activities, the net decrease in cash
was R22 million versus a R57 million decrease in 2000.
Despite lower than budgeted export sales, exports accounted for US$84,5
million of our revenues. This is still short of the target to have more than
50% of our sales outside South Africa. The events of September 11 and the
slower than expected recovery in South East Asia had a negative effect on
our sales to North America and to our Asian alliance partner Hitachi
Construction Machinery. Our exports into Europe and Africa were ahead of
budget but not sufficient to make up the US$21 million required to achieve
our 50/50 sales objective.
The first two months of the current financial year have been profitable
and we are ahead of sales budgets. Providing we can increase our exports and
the Southern African economy holds up, as expected, 2002 will be another
profitable year. Our focus for 2002 will be to continue our programme to
attain even higher levels of quality in our product, increase sales outside
of South Africa and drive our cost reduction and manufacturing efficiency
improvement programme.
H J Buttery
Group Chairman 19 March 2002
DECLARATION OF DIVIDEND
Notice is hereby given that a dividend of ten (10) cents per ordinary share
of no par value payable in the currency of the Republic of South Africa will
be paid to shareholders registered at 5 April 2002. The last date to trade
"cum" the dividend will be Wednesday, 27 March 2002. The share will trade
"ex" dividend on Thursday, 29 March 2002. No share certificates may be
dematerialized or rematerialized from Wednesday, 20 March 2002 to Friday, 5
April 2002, both days inclusive.
The dividend will be paid on or about 17 April 2002.
By order of the Board.
D P Mahony
Company Secretary
Registered office Transfer secretaries
13 - 19 Carbonode Cell Mercantile Registrars Limited
Alton PO Box 1053
Richards Bay 3900 Johannesburg 2000
Directors:
G W Bell (Chief Executive), H J Buttery (Chairman), *Dr M W Arnold (USA),
P C Bell, M A Campbell, *M A Guinn (USA), *G P Harris, *P J C Horne,
*T D Kgobe*, J W Kloet (USA), *M O Rysa (Finnish),
*D J J Vlok (*Non-Executive Directors)
Alternate Directors:
*C D Anderson (USA), P A Bell, D I Campbell, T J Graff (USA),
D B Rhind, D C Manhart (USA)
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