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DAWN - Audited results for the year ended 30 June 2004

Release Date: 18/08/2004 17:57
Code(s): DAW
Wrap Text

DAWN - Audited results for the year ended 30 June 2004 Distribution and Warehousing Network Limited (Incorporated in the Republic of South Africa) (Registration number 1984/008265/06) Alpha code: DAW ISIN: ZAE000018834 ("DAWN" or "the Group") Audited results for the year ended 30 June 2004 - Annual sales exceed R1 billion - Attributable earnings up 44,6% - Headline earnings per share up 63,3% Group income statement Audited Audited 12 months 12 months 30 June 30 June % 2004 2003
change R"000 R"000 Revenue 1 047 417 933 051 - Continuing operations 13,9 1 042 225 915 267 - Discontinued operations 5 192 17 784 Operating profit 62 696 48 194 - Continuing operations 30,8 62 528 47 807 - Discontinued operations 168 387 Net finance costs (5 813) (6 645) Income from associate 14 513 - Profit before taxation 71,8 71 396 41 549 Taxation (22 617) (9 988) Profit ater taxation 48 779 31 561 Minority interest (3 157) - Attributable earnings 44,6 45 622 31 561 Included above: Depreciation 9 199 8 496 Operating lease charges 9 176 8 276 Reconciliation of headline earnings Earnings for the year 45 622 31 561 Adjustment for the after tax effect of - Recovery of investment written off - (4 350) - Impairment of fixed assets - 3 543 - Amortisation of goodwill - 600 Headline earnings 45,5 45 622 31 354 Statistics Number of shares ("000) - in issue 169 013 188 984 - held in treasury 7 726 21 145 - share incentive scheme 12 807 15 200 - weighted average 149 445 167 680 Headline earnings per share (cents) 63,3 30,53 18,70 Attributable earnings per share (cents) 30,53 18,82 Operating profit (%) 6,0 5,2 Group balance sheet Audited Audited
30 June 30 June 2004 2003 R"000 R"000 Assets Non-current assets Property, plant and equipment 21 456 23 441 Investment in associates 23 023 - Current assets 326 643 263 220 Inventory 132 566 111 531 Receivables and prepayments 167 827 137 315 Cash and cash equivalents 26 250 14 374 Total assets 371 122 286 661 Equity and liabilities Capital and reserves Ordinary shareholders" equity 124 778 92 286 Minority interest 12 - Non-current liabilities 37 659 26 815 Interest-bearing liabilities 22 133 22 238 Non-interest-bearing liabilities 12 310 - Deferred tax liabilities 3 216 4 577 Current liabilities 208 673 167 560 Trade and other payables 183 932 149 839 Current portion of borrowings 9 113 4 748 Tax liability 15 628 12 973 Total equity and liabilities 371 122 286 661 Capital commitments 14 589 10 650 Future commitments 92 390 67 030 Finance leases 14 510 14 574 Operating leases 77 880 52 456 Asset value per share - net asset value (cents) 84,04 60,46 - market price (cents) 240 92 Market capitalisation at year-end (R"000) 405 631 173 865 Financial gearing ratio (%) 25,04 29,24 Current asset ratio (times) 1,57 1,57 Group cash flow statement Audited Audited 12 months 12 months
30 June 30 June 2004 2003 R"000 R"000 Cash generated from operations 53 936 64 447 Net finance charges paid (4 061) (6 645) Taxation paid (16 623) (7 985) Cash flow from operating activities 33 252 49 817 Cash flow from investing activities (26 364) (7 339) Cash flow from financing activities 19 666 11 897 Capital distribution (7 169) - Shares repurchased (7 509) (58 785) Increase/(decrease) in cash resources 11 876 (4 410) Cash resources at beginning of year 14 374 18 784 Cash resources at end of year 26 250 14 374 Statement of changes in equity Audited Audited 12 months 12 months 30 June 30 June 2004 2003
R"000 R"000 Opening balance 92 286 119 280 Attributable earnings 45 622 31 561 Capital distribution (7 169) - Share incentive scheme 1 548 230 Treasury shares acquired (7 509) (5 988) Shares repurchased and cancelled - (52 797) Balance at the end of the year 124 778 92 286 Commentary Group profile The DAWN Group is a leading distributor and supplier of quality plumbing, hardware and related materials to the retail sector of the building and construction industries. Recent investments have given DAWN access to an expanded product range and customer base, including the petrochemical, agricultural and mining sectors of the market, as well as into infra-structural development, both locally and in selected African countries. Financial Overview The Group is operating in a favourable market environment, resulting in buoyant trading conditions during the period. As a consequence, two important milestones were recorded, namely monthly sales in excess of R100 million and annual sales of over R1 billion. Turnover increased to R1, 047 billion, resulting in a 14% increase on continuing operations. This result was achieved without any growth from acquisitions as focus was applied to consolidation of existing businesses. Operating profit as a percentage of turnover increased from 5,2% to 6%, whilst profit before tax of R71 million is 72% higher than that of the comparative period. Headline earnings at R45,6 million represent an increase of 45% over the comparative period, whereas earnings per share and headline earnings per share at 30,5 cents increased by 63%. Net asset value of 84 cents per share is 39% higher, whilst cash on hand stood at R26 million (2003: R14 million). The debt ratio decreased from 29% to 25% at year-end. The results have been prepared in accordance with South African statements of Generally Accepted Accounting Practice. The accounting policies used are consistent with those used in the comparative period for the year ended 30 June 2003, except for the consolidation of the share incentive trust in terms of AC132. These financial statements have been audited by the Group"s auditors, PricewaterhouseCoopers Inc, and their unqualified report is available for inspection at the Group"s registered office. Post-balance Sheet Events The following events occurred after year-end: - The Group acquired a 76% interest in Amalgamated Fasteners and Fittings Group (Pty) Limited ("AFF"), effective from 1 July 2004. AFF is involved in the wholesale distribution of hardware fittings and components for the cabinet industry, on a national basis. The maximum purchase consideration for the 76% is R15,2 million, payable over two years on a warranted future earnings basis. The DAWN Group also has a call option to acquire the balance of the AFF shareholding during the next two years, at a similar P/E ratio of 4. - The DAWN Group has acquired a 78% shareholding in Cobra, at a purchase consideration expected to amount to R145 million for 100%, effective 1 January 2005 at the latest and subject to certain suspensive conditions. An announcement in this regard was published on 30 July 2004. Prospects The Group anticipates the building, construction and property sectors to continue its upward trend in the foreseeable future, especially in view of the latest reduction in interest rates. In addition, benefits from the abovementioned strategic actions should become evident during the next year. As a result the Group is well positioned to continue its strong improvement in earnings for the foreseeable future. The issue of Black Economic Empowerment is also being addressed as a matter of great importance and urgency. The Group expects to make an announcement in this regard in the near future. Distribution to Shareholders In keeping with the Group"s policy, the Board has recommended a capital distribution of 7 cents per share, subject to shareholders" approval. A further announcement in this regard will be made in due course. On behalf of the Board LM Alberts DA Tod Johannesburg Chairman Chief executive officer 18 August 2004 Registered office 2 Keerom Road, Heriotdale Ext 10, Cleveland, Johannesburg 2000 Transfer secretaries Computershare Investor Services 2004 (Pty) Limited, 70 Marshall Street, Marshalltown 2001 (PO Box 61051, Marshalltown 2107) Directors LM Alberts* (Chairman), DA Tod (Chief executive officer), JA Beukes, RL Hiemstra*, AB Lishman* *Non-executive E-mail: info@dawnltd.co.za www.dawnltd.co.za Date: 18/08/2004 05:57:15 PM Supplied by www.sharenet.co.za Produced by the JSE SENS Department

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