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Transpaco Limited - Reviewed Group Results For The Year Ended 30 June 2004 TRANSPACO LIMITED Reg.No.1951/000799/06 ISIN: ZAE000007480 Share Code: TPC REVIEWED GROUP RESULTS FOR THE YEAR ENDED 30 JUNE 2004 HIGHLIGHTS PER UP SHARE
HEADLINE EARNINGS 71,8c 18% OPERATING CASH FLOW 157,2c 16% DIVIDENDS 18c 20% NET ASSET VALUE 356c 16% NATURE OF BUSINESS Transpaco manufactures, distributes and recycles plastic and packaging products mainly in South Africa and exports into Africa. BUSINESS REVIEWThe Board is pleased to report improved results reflecting an increase in headline earnings per share of 18% to 71,8 cents (June 2003 - 61,1 cents). Turnover decreased by 6% to R301 million (June 2003 - R320 million) mainly attributable to the deflationary environment and the decline in sales of plastic bags as a result of the plastic bag regulations. Notwithstanding the decrease in turnover, operating income increased by 7% to R29,6 million (June 2003 - R27,7 million) as a result of improved gross profit margins and a 7% reduction in operating costs. Strong cash flows and lower interest rates resulted in net interest paid decreasing by 39% to R2,9 million (June 2003 - R4,7 million). This reduction contributed to the improved income before taxation by 16% to R26,7 million (June 2003 - R23,0 million). Interest cover increased to 10,3 times (June 2003 - 5,9 times). The number of ranking shares in issue reduced as a result of the group repurchasing 572 231 shares at an average price of R3.68 per share for R2 102 995. The net asset value per share increased by 16% to 356 cents (June 2003 - 306 cents).PROSPECTSTranspaco is expanding group operations into a specialised film division catering for the pallet wrap and the cast polypropylene markets. A new factory is being established utilising the latest plant technology available for the production of cast film products at a cost of approximately R13 million. The Group expects real earnings growth and further positive cash flow for the year ahead due to the following: the carrier bag business now operates in a settled environment expansion projects entered into during the reporting period at the Recycling, Polymer and Sheet Extrusion divisions will benefit the Group for a full twelve- month period the Group is ideally poised to take advantage of the buoyant retail sector.BEE INITIATIVETranspaco continues to be involved in discussions with several parties relating to a broad based Black Economic Empowerment transaction. DIVIDENDThe board has declared a dividend of 11 cents per share to shareholders recorded in the register on Thursday 23 September 2004 payable on Monday 27 September 2004. The last day to trade "cum" dividend will be Thursday 16 September 2004. Shares will commence trading "ex" dividend from the commencement of business on Friday 17 September 2004. The record date will be Thursday 23 September 2004. Share certificates may not be dematerialised or rematerialised between Friday 17 and Thursday 23 September 2004, both days inclusive. BASIS OF ACCOUNTINGThese results are prepared in accordance with South African statements of Generally Accepted Accounting Practice, the Companies Act and the listing requirements of the JSE Securities Exchange South Africa. The accounting policies used are consistent in all material respects with those applied in the previous year except for the consolidation of the Share Incentive Trust. Comparative figures for earnings per share and headline earnings per share have been restated to take into account shares held by the Transpaco Share Incentive Scheme. REVIEW OF INDEPENDENT AUDITORSThe Group"s auditors Ernst and Young have reviewed the results. Their unqualified review report is available for inspection at Transpaco"s registered office. ON BEHALF OF THE BOARDAJ Aaron PN Abelheim L WeinbergNon-executive Chairman Chief Executive Financial Director DATE: 25 August 2004 CONSOLIDATED INCOME STATEMENT Reviewed % Audited 12 months Change 12 months
R"000 June 2004 June 2003 Turnover 300 796 (6) 319 607 Cost of sales 193 651 (8) 209 891 Gross Profit 107 145 (2) 109 716 Operating costs 67 309 (7) 72 504 Depreciation 10 277 8 9 545 Operating Income 29 559 7 27 667 Net interest paid 2 871 (39) 4 680 Income before taxation 26 688 16 22 987 Taxation 6 693 28 5 212 Current taxation 4 670 3 525 Deferred taxation 1 179 1 476 Secondary taxation on companies 844 211 Income after taxation 19 995 12 17 775 Weighted average number of shares 27 239 29 442 in issue (`000) Diluted weighted average number of 29 203 31 015 shares in issue (`000) Earnings per share (cents) 73,4 22 60,4 Diluted earnings per share (cents) 67,4 19 57,3 Headline earnings per share 71,8 18 61,1 (cents) Diluted headline earnings per 67,4 16 58,0 share (cents) Dividends per share (cents) 18,0* 20 15,0 Reconciliation of headline earnings (R"000) Basic earnings 19 995 17 775 Impairment of assets 0 187 (Profit)/Loss on disposal of (426) 41 plant and equipment Headline earnings 19 569 18 003 * Includes interim dividend of 7 cents and a dividend declared after the period of 11 cents. CONSOLIDATED BALANCE SHEET Reviewed Audited
12 months 12 months R"000 June 2004 June 2003 ASSETS Non-current assets 67 508 54 888 Property, plant and equipment 66 908 54 259 Intangibles 600 629 Current assets 104 750 98 675 Inventories 28 104 26 389 Accounts receivable 57 930 60 949 Taxation 3 493 3 226 Cash resources 15 214 8 111 TOTAL ASSETS 172 249 153 563 EQUITY AND LIABILITIES Capital and reserves 96 747 85 091 Issued capital 272 281 Reserves 1 688 1 688 Employee compensation reserve (130) - Accumulated profit 94 917 83 122 Non-current liabilities 19 125 14 653 Interest bearing borrowings 15 993 12 709 Deferred taxation 3 123 1 944 Current liabilities 56 386 53 819 Trade and other payables 49 144 47 039 Current portion of interest bearing 7 242 6 780 borrowings TOTAL EQUITY AND LIABILITIES 172 249 153 563 Number of shares in issue `000 `000 Number of shares in issue 27 786 29 805 (net of 2 906 423 treasury shares) Shares repurchased and cancelled - (2 019) Shares repurchased (572) - Ranking number of shares 27 214 27 786 Salient features Net asset value per share (cents) 356 306 Gearing ratio % 8 13 Shareholders Funds : Total assets % 62 58 Interest cover (x) 10,3 5,9 Operating margin % 9,8 8,7 ABRIDGED CONSOLIDATED CASH FLOW Reviewed Audited
12 months 12 months R"000 June 2004 June 2003 Cash flow from operating activities Cash generated from operations 42 819 40 003 Dividend paid (6 106) - Finance charges (2 871) (4 680) Taxation paid (5 781) (5 367) Net cash flow from operating 28 061 29 956 activities Cash flow from investing activities Proceeds on disposal of plant and 2 006 294 equipment Acquisition of plant and equipment (24 477) (8 877) Net cash flow from investing (22 471) (8 583) activities Cash flow from financing activities Increase/(Decrease) in long term 3 284 (2 812) borrowings Increase in short term borrowings 462 915 Employee compensation reserve (130) - Repurchase of share capital (2 103) (5 329) Net cash flow from financing 1 513 (7 226) activities Net movement in cash for the year 7 103 14 147 Cash and cash equivalents at the 8 111 (6 036) beginning of the year Cash and cash equivalents at the end 15 214 8 111 of the year STATEMENT OF CHANGES IN EQUITY Reviewed Audited 12 months 12 months R"000 June 2004 June 2003 Opening balance 85 091 72 596 Earnings attributable to shareholders 19 995 17 775 Employee compensation reserve (130) - Dividend paid (6 106) - Repurchase of share capital (2 103) (5 280) Closing balance 96 747 85 091 DIRECTORSAJ Aaron* (Chairman) ; PN Abelheim (Chief Executive); HA Botha; JS Botha; SR Bouzaglou; SL Chaitel; DR Hilewitz*; SI Jacobson*; AC Salomon*; SP van der Linde*; L Weinberg *non-executiveAUDITORS: Ernst & Young SPONSOR: Investec Bank Limited REGISTERED OFFICE 331 Sixth Street Wynberg, Sandton WEBSITE: www.transpaco.co.za TRANSFER SECRETARIES Computershare Investor Services 2004 (Pty) Ltd 70 Marshall Street, Johannesburg Date: 25/08/2004 05:52:54 PM Supplied by www.sharenet.co.za Produced by the JSE SENS Department
