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Cullinan Holdings Limited - Interim Results For The Six Months Ended 31 March
2003
CULLINAN HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1902/001808/06)
(Share Code: CUL ISIN number: ZAE000013710)
Interim results for the six months ended 31 March 2003
* Earnings per share up 52%
* Cash balances of R81,4 million
* Dividends resumed after 10 years
Group balance sheet
Unaudited Unaudited Audited
six months six months year end
31 March 31 March 30 September
2003 2002 2002
R"000 R"000 R"000
Assets
Property, plant and equipment 25 409 14 588 22 009
Goodwill 11 198 12 003 13 416
Deferred taxation 6 000 3 000 6 000
Current assets 146 523 189 084 126 503
Inventory 8 016 9 135 8 379
Accounts receivable 57 089 94 674 50 056
Cash resources 81 418 85 275 68 068
Total assets 189 130 218 675 167 928
Equity and Liabilities
Ordinary shareholders equity 34 192 14 104 24 414
Outside shareholders interest - 917 29
Interest bearing term loans 26 667 29 555 27 716
Preference share capital 26 046 26 046 26 046
Long term loans - 472 -
Short term loans 621 3 037 1 670
Current liabilities 128 271 174 099 115 769
Accounts payable 117 632 109 971 106 626
Provisions 10 104 8 400 8 734
Receiver of revenue 251 151 128
Preference dividends 284 1 186 281
Bank overdrafts - 54 391 -
Total equity and liabilities 189 130 218 675 167 928
Financial statistics
Gearing (%) - 129,9 -
Current Ratio 1,1 1,1 1,1
Net asset value per share (cents) 4,8 2,1 3,6
Group income statement
Unaudited Unaudited Audited
six months six months year end
31 March 31 March 30 September
2003 2002 2002
R"000 R"000 R"000
Revenue 83 637 65 538 138 613
Net operating expenses (72 882) (55 955) (117 628)
Operating income 10 755 9 583 20 985
Exceptional items (2 223) (574) (2 361)
Net operating income 8 532 9 009 18 624
Net financing (charges)/income 1 433 (1 409) (2 129)
Income before tax 9 965 7 600 16 495
Taxation - STC (187) (149) (324)
Income after tax 9 778 7 451 16 171
Outside shareholder"s interest - (457) (108)
Net attribuatble income 9 778 6 994 16 063
Ordinary shares (000"s)
In issue 715 688 684 638 684 638
Earnings per ordinary share 1,4 1,0 2,3
Fully diluted earnings per share 1,4 1,0 2,3
Headline earnings per ordinary
share (cents) 1,7 1,1 2,7
Determination of headline
earnings
Net attributable income 9 778 6 994 16 063
Exceptional items 2 223 574 2 361
Headline income 12 001 7 568 18 424
Group statement of changes in equity
Unaudited Unaudited Audited
six months six months year end
31 March 31 March 30 September
2003 2002 2002
R"000 R"000 R"000
Ordinary share capital
Balance at the beginning of period 7 157 6 846 6 846
Isssued during the period - - 311
Balance at the end of period 7 157 6 846 7 157
Share premium
Balance at the beginning of period 59 795 58 865 58 865
Premium on issue of shares - - 930
Balance at the end of period 59 795 58 865 59 795
Revaluation reserve
Balance at the beginning of period 232 232 232
Balance at the end of period 232 232 232
Share capital reduction
reserve fund
Balance at the beginning of period 20 876 20 876 20 876
Balance at the end of period 20 876 20 876 20 876
Capital redemption reserve fund
Balance at the beginning of period 4 4 4
Balance at the end of period 4 4 4
Accumulated profit/(loss)
Balance at beginning of period (63 650) (79 713) (79 713)
Attributable income for the
period 9 778 6 994 16 063
Balance at the end of period (53 872) (72 719) (63 650)
Ordinary shareholders equity 34 192 14 104 24 414
Group cash flow statement
Unaudited Unaudited Audited
six months six months year end
31 March 31 March 30 September
2003 2002 2002
R"000 R"000 R"000
Cash flow from operating
activities
Operating income 8 532 9 009 18 624
Depreciation 2 059 2 706 5 914
Profit on sale of fixed assets - - 1 996
Other non-cash Items 2 218 268 (3 057)
Decrease in working capital 5 678 2 649 18 044
Cash generated from
operating activities 18 487 14 632 41 521
Net interest received/(paid) 2 936 (218) 479
Net interest received/(paid) 2 936 (218) 479
Taxation (paid)/refund - - (2 252)
Preference dividends paid (1 500) (1 191) (3 599)
Secondary taxation on companies (65) (149) (324)
Net cash flow from
operating activities 19 858 13 074 35 825
Cash flows from investing
activities
Investment to maintain operations:
Goodwill on acquisitions - (1 052) (2 140)
Replacement of property, plant and
equipment (5 459) (420) (15 933)
Net proceeds from disposal of
property, plant and equipment - - 2 881
Net proceeds from disposal of
subsidiaries and investments - 45 421 74 171
Net cash outflows from investing
activities (5 459) 43 949 58 979
Cash flows from financing activities
Short-term liabilities (repaid)/raised (1 049) (954) (2 793)
Ordinary share capital
issued/(repurchased) - - 1 242
Redemption of preference shares - - (25 000)
Preference shares issued - - 25 000
Net cash outflow from financing
activities (1 049) (954) (1 551)
Increase in cash and cash
equivalents 13 350 56 069 93 253
Cash and cash equivalents at
beginning of period 68 068 (25 185) (25 185)
Cash and cash equivalents at
end of period 81 418 30 884 68 068
Notes:
1. Accounting policies
The accounting policies used in the preparation of the interim financial
statements for the six months to March 2003 are the same as those used in the
audited results for the financial year ended September 2002.
The interim financial statements comply with Statements of South African
Generally Accepted Accounting Practice.
2. Exceptional items
Unaudited Unaudited Audited
six months six months 12 months
ended ended ended
31 March 31 March 30 September
2003 2002 2002
R000"s R000"s R000"s
Amortisation of goodwill (384) (268) (718)
Computer implementation costs (1064) - (1949)
Restructuring costs (775) (1101) (3167)
Deferred tax - - 3000
Other - 795 473
Total (2223) (574) (2361)
Comments
The company performed well in a disturbed international travel environment.
Headline earnings per share increased by 52% over the same period last year.
This reflects an improved performance in each of our major trading divisions
with the exception of the Singapore operation. The effects of the war in Iraq
have been limited thus far; however, travel to and from the Far East has been
disrupted by the outbreak of SARS.
During the six months under review the company experienced record turnover
and profits in all divisions. On the incoming side our partners are selling
South Africa well. This country offers the international visitor value for money
and is a premier destination. The outgoing business and our retailers benefited
from the stronger currency, which made our over border product more affordable.
Thompsons Tours (Outbound Tourism)
A long-term contract has been signed to provide wholesale travel arrangements
to the retail travel agencies within the Bidvest Group with effect from 1 April
2003. These include the well-known brands of Rennies, Harvey World Travel and
Connex and will add further bulk to our already strong distribution channels.
Selling South African holidays to South Africans is a growing part of the Tours
product mix, which protects this division from fluctuations in the currency
markets.
Thompsons South Africa (Inbound Division)
The record sales for the six months under review were tempered by
disappointing results from our Singapore office, where the strength of the rand
had a material effect on trading. In addition the stronger rand caused a R2,0
million write-off of the Singapore loan account to that operation. Traffic from
the USA was affected by the Iraqi situation; however, all other markets
performed well. Our Touring division, which sells Guided Coach Tours of South
Africa on a guaranteed departure basis and open vehicle game drives in the
Kruger Park, continues to grow its passenger volumes at improved margins.
Retail Travel (Corporate and Leisure)
The Leisure Travel division, which is led by Pentravel, has had a good six-
month trading period, with increased sales and profits. The Corporate travel
division is small but makes a steady contribution.
Manex and Power Marine
Manex, which sells to the Yacht Building and Scuba Diving industries, has had a
steady six months. While the Scuba diving business is benefiting from the
stronger rand, there is a concern that the yacht building industry may be
affected if the rand continues to strengthen.
Prospects
The second half of the financial year has started well and, barring
unforeseen events, the company is anticipated to trade at the existing levels.
Dividend
As the company has now returned to profitability, and is on a sound financial
footing, the board has declared a final ordinary dividend for the financial year
ending September 2003 of 1 cent per ordinary share (number 124) to all ordinary
shareholders. The last date to trade cum dividend will be Friday 23 May 2003.
Shares will commence trading ex dividend from Monday 26 May 2003 and the record
date will be Friday 30 May 2003. The dividend will be paid on Monday 2 June
2003. Share certificates may not be dematerialised or rematerialised between
Monday 26 May 2003 and Friday 30 May 2003, both days inclusive.
Directors:
M A Ness (Non Executive Chairman), D D Hosking (Non-executive),
V E T O" Hana (Non-executive)A A Thompson (CEO), Q A Southey (FD),
M R Bagus (Non-executive)
Registered Office:
1st Floor, Dunkeld West Centre
Corner Jan Smuts Avenue and Bompas Road
Dunkeld West
Johannesburg, South Africa
Transfer Secretaries:
Computershare Investor Services Limited
Ground Floor
70 Marshall Street
Johannesburg, 2001
(PO Box 1053, Johannesburg, 2000)
For further information on group activities, please write to:
The Group Secretary
Cullinan Holdings Limited
PO Box 41032
Craighall, 2024
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