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Labat Africa Limited - Unaudited interim results for the six months ended 31 August 2002 Labat Africa Limited (Incorporated in the Republic of South Africa) Share code: LAB ISIN: ZAE000018354 (Registration number 1986/001616/06) ("Labat" or "the company" or "the group") Unaudited interim results for the six months ended 31 August 2002 * REVENUE + 48% * OPERATING income + 27% * HEADLINE EARNINGS + 32% THE POWER TO DELIVER CONSOLIDATED INCOME STATEMENTS Unaudited Unaudited Audited six months six months 12 months 31/08/02 31/08/01 28/02/02
R`000 R`000 R`000 Revenue 145 257 98 081 224 204 Net operating income before interest and taxation 22 253 17 522 46 278 Interest paid (4 726) (3 415) (6 619) Interest received 276 549 760 Net income before taxation 17 803 14 656 40 419 Taxation 9 228 (537) (912) Net income after taxation 27 031 14 119 39 507 Attributable to minority shareholders (39) (1 060) (2 140) Income attributable to shareholders 26 992 13 059 37 367 Reconciliation to headline earnings Less deferred tax asset raised (9 739) - - Headline earnings 17 253 13 059 37 367 Headline earnings per share (cents) 9,3 7,1 20,2 Basic earnings per share (cents) 14,6 7,1 20,2 Shares in issue throughout period (`000) 184 903 184 903 184 903 CONSOLIDATED BALANCE SHEETS Unaudited Unaudited Audited six months six months 12 months
31/08/02 31/08/01 28/02/02 R`000 R`000 R`000 ASSETS Fixed assets 40 490 14 133 16 828 Investments 31 362 32 471 28 446 Deferred taxation 9 739 - - Non-current assets 81 591 46 604 45 274 Cash 35 374 14 790 39 612 Inventory 40 803 23 150 34 443 Accounts receivable 112 550 111 975 110 530 Current assets 188 727 149 915 184 585 Total assets 270 318 196 519 229 859 EQUITY AND LIABILITIES Share capital and reserves 147 168 97 010 121 318 Outside shareholders 3 626 2 068 3 082 Total shareholders` funds 150 794 99 078 124 400 Long-term liabilities 21 274 5 544 6 045 Deferred taxation 10 594 9 880 10 576 Non-current liabilities 31 868 15 424 16 621 Bank overdrafts 46 220 35 953 40 955 Accounts payable 41 436 46 064 47 883 Current liabilities 87 656 82 017 88 838 Total equity and liabilities 270 318 196 519 229 859 Number of shares in issue (`000) 184 903 184 903 184 903 Net asset value per share (cents) 80 53 66 CASH FLOW STATEMENTS Unaudited Unaudited Audited six six year
months to months to ended 31/08/02 31/08/01 28/02/02 Net flow from operating activities 10 151 12 054 32 210 Net flow from investing activities (29 372) (2 312) (5 501) Net flow from financing activities 14 983 (215) 7 640 Net (decrease)/increase in cash (4 238) 9 527 34 349 Cash at beginning of period 39 612 5 263 5 263 Cash at end of period 35 374 14 790 39 612 STATEMENT OF CHANGES IN EQUITY Distri- Capital Share Share butable and capital premium reserves reserves
R`000 R`000 R`000 R`000 Balance at 28 February 2002 1 849 49 090 70 379 121 318 Surplus for period - - 26 991 26 991 Write-off of loan to share incentive trust - (1 141) - (1 141) Balance 31 August 2002 1 849 47 949 97 370 147 168 COMMENTARY The first six months of the year have been exceptionally good for the company. Revenue was up by 48% and operating income increased by 27%. Each of the business units has performed well and is positioned for further growth. We have once again focused on the development of these four core businesses and are pleased with the progress. However, we anticipate that the past phenomenal growth will not be mirrored in the full year-end results. Sames The company has performed well, benefiting from expanding markets in India and China and from new product sales. Product piracy has become a problem for us and our microchips are being copied in some markets. Measures to combat this threat are in hand. Further international markets for our range of products will be developed in the year ahead. Labat Traffic Solutions Labat Traffic Solutions has had a good six months and is poised to win several major new contracts. Three new contracts implemented in the Nelson Mandela Metro, George and Emphuleni council are fully operational. This brings to six the number of contracts that are fully implemented. The range of services provided by Labat Traffic Solutions has been expanded by the acquisition of a 51% interest in Total Computer Services, a company providing back office I.T. support to various municipalities. Labat Traffic Solutions is well on its way to being a comprehensive solutions provider to municipalities. Labat Management Consulting We have used the past six months to market our consulting services to a wider range of customers and particularly to municipalities. We have tendered with various skilled partners for a wide range of technology-backed projects which we are well-positioned to win. We expect the business to grow significantly in the year ahead. Labat Retail Our furniture retail business has performed well in difficult circumstances. The industry as a whole has been under severe pressure. We missed our operating profit target by R0,9 million which can be directly related to self-imposed restrictions on credit granting. The same rigid credit approval principles will be maintained in future. We have taken cognisance of the prudence that characterises the industry currently and raised the provision against our debtors` book by a further 6,23% to be fully in line with the industry. Investments The recoverability of the selling price of our investment in Armada continues to be a problem. We sold the company but have never been fully paid by the purchasers. An amount of R5,4 million is outstanding and has been fully provided for. We are in the process of regaining our assets and are convinced that we will regain at least the value provided for. Restructuring As part of ongoing performance improvement we are looking at restructuring the various businesses in order to capitalise on current opportunities. Discussions are currently taking place with several parties who are interested in partnering with us to pursue major initiatives. Taxation In order to comply with the latest Generally Accepted Accounting Practices ("GAAP") provisions we have created a tax asset on that percentage of tax losses which we are confident of using. Accounting policies The accounting policies applied are consistent with those applied in the previous year and are in compliance with South African Statements of GAAP. Dividends It is company policy that no dividends will be declared as group surpluses will be retained to fund future growth. For and on behalf of the board B G van Rooyen Group Chief Executive 21 Novemer 2002 Directors: B G van Rooyen (Group CEO), V J Labat (USA), C P Rosholt, R C I Serobe, M J Shabangu, S L Majombozi
Secretary: M Sender, FCIS Date: 21/11/2002 05:15:00 PM Supplied by www.sharenet.co.za Produced by the JSE SENS Department
