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AFX - Afrox - Amended Abridged Results for the six months to 31 March 2007

Release Date: 04/05/2007 14:53
Code(s): AFX
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AFX - Afrox - Amended Abridged Results for the six months to 31 March 2007 African Oxygen Limited (Incorporated in the Republic of South Africa) (Registration number 1927/000089/06) JSE code: AFX, NSX code: AOX ISIN: ZAE000067120 ("Afrox" or "the Company") AMENDED RESULTS RELEASE ("amended release") This amended release supersedes the announcement released on SENS at 13h00 today. There are no material differences between the amended release and the earlier release, save for some amendments to the commentary to the results. African Oxygen limited abridged results for the six months to 31 March 2007 PERFORMANCE REVIEW African Oxygen Limited (Afrox) continued to produce sound results in a buoyant manufacturing economy where demand for certain of our products outstripped supply. The comparative results of the period ended 31 March 2006 have been adjusted as disclosed in note 7.1. This allows the comparison of March 2007 results to be a more appropriate measure to reflect the results of the continuing business. On this basis, revenue was 17 percent higher at R2,1 billion (2006: R1,8 billion) with profit from operations at R392 million (2006: R318 million), an increase of 23 percent. Net profit for the period was 18 percent up at R240 million (2006: R203 million). Adjusted headline earnings per share were 19 percent higher at 78,8 cents (2006: 66,2 cents) and adjusted basic earnings were 77,8 cents (65,9 cents), an increase of 18 percent. The balance sheet remains strong, with gearing at 25,6 percent (2006: 26,5 percent), despite the large capex spend. The buoyant demand situation in the reporting period produced challenges for the business from a supply perspective. As previously announced, the company embarked on an extensive investment programme initiated during the 2006 financial year. As a result, the capital expenditure for the six months, of R400 million, is significantly higher than the R200 million for 2006. This will go a long way to meeting future demand. The initial benefit of this capex programme can be expected in the second half of 2007. CHANGE IN THE YEAR END These interim financial results are published for information purposes. Afrox has changed its year-end to December to align itself with its holding company, The Linde Group. This financial year will therefore end on 31 December 2007. A comprehensive interim report will be produced for the nine months ending 30 June 2007, at which time an interim dividend will be considered. BEE RATING Afrox has improved its BEE rating from a BB to BBB. CHANGES TO THE BOARD Tjaart Kruger (47) has joined the company as Managing Director, effective 1 April 2007. He joins Afrox from the Tiger Brands Group where he held several senior executive positions. He succeeds Rick Hogben, the previous Managing Director, who retired from the board at the end of March 2007. Alan Ferguson and Jim Ford, non-executive directors and Daniel Shook, an alternate director, resigned from the board with effect 30 March 2007, following their resignations from The Linde Group. Alan Watkins and Jurgen Nowicki were appointed to the board as non-executive directors with effect from 4 April 2007. They both hold executive positions with The Linde Group. OUTLOOK Business activity remains strong on the back of a growing South African economy and the company is well positioned for real growth in earnings. Kent Masters Tjaart Kruger Chairman Managing Director Johannesburg 4 May 2007 1. BASIS OF PREPARATION These interim financial statements have been prepared in accordance with the recognition and measurement requirements of International Reporting Standards, (IFRS), the disclosure requirements of IAS 34 -Interim Financial Reporting, the listing requirements of the JSE Limited and the South African Companies Act. These financial statements do not contain all the information and disclosures required in the annual financial statements, and should be read in conjunction with the group consolidated annual financial statements as at 30 September 2006. 2. SIGNIFICANT ACCOUNTING POLICIES The accounting policies applied are consistent with those followed in the preparation of the consolidated annual financial statements for the year ended 30 September 2006. By order of the Board. Ria Sanz Company Secretary www.afrox.com Directors: JK Masters** Chairman), TJN Kruger (Managing Director), AJ Cullens*, A Watkins*, J Nowicki***, DM Lawrence, LA MacNair, KDK Mokhele, SM Pityana, LL van Niekerk, CJPG van Zyl Company Secretary: ME Sanz *British **American ***German African Oxygen Limited (incorporated in the Republic of South Africa) Registration number: 1927/000089/06 ISIN: ZAE000067120, JSE code: AFX, NSX code: AOX ("Afrox") Registered office: Afrox House, 23 Webber Street, Selby, Johannesburg, 2001, PO Box 5404, Johannesburg, 2000, Telephone (+27 11) 490-0400, Transfer secretaries: Computershare Investor Services 2004 (Pty) Limited, 70 Marshall Street, Johannesburg, 2001, PO Box 61051, Marshalltown, 2107, Telephone: (+ 27 11) 370-5000. Sponsor in South Africa: Barnard Jacob Mellet Corporate Finance (Pty) Limited. Sponsor in Namibia: Namibia Equity Brokers (Pty) Limited. AFRICAN OXYGEN LIMITED INTERIM RESULTS SENS ANNOUNCEMENT 3. SUMMARISED BALANCE SHEET Unaudited Unaudited Audited
31 March 31 March 30 September Rm 2007 2006 2006 ASSETS Non-current assets 2,556 2,360 2,297 Current assets 1,547 1,137 1,618 Total Assets 4,103 3,497 3,915 EQUITY AND LIABILITES Capital and reserves 2,189 1,820 2,271 Non current liabilities 578 632 464 Current liabilities 1,336 1,045 1,180 Total Equity and Liabilities 4,103 3,497 3,915 4. SUMMARISED INCOME STATEMENT Unaudited Unaudited Audited 6 months 6 months 12 months to to to
Rm March 2007 March 2006 September 2006 Group Revenue 2,110 1,845* 3,914 Operating profit 392 379 754 Profit on sale of investment - - 362 Profit from operations 392 379 1,116 Net finance (costs) (21) (17) (35) Income from associates (1) 53 100 Profit before taxation 370 415 1,181 Income tax expense (127) (124) (316) Profit for the period 243 291 865 Attributable to Equity holders of the company 240 289 858 Minority interest 3 2 7 Net profit for the period 243 291 865 *Refer to note 7.1 (iii) 5. EARNINGS PER SHARE Unaudited Unaudited Audited
6 months 6 months 12 months to to to Rm March 2007 March 2006 September 2006
Total net profit for the period attributable to equity holders of The company 240 289 858
Reversal for headline earnings 3 1 (267) Headline earnings 243 290 591 Basic earnings per ordinary 77.7 93.5 278.1 share - Group (cents) Adjusted BEPS-Industrial 77.7 65.9 148.6 operations (cents) Headline earnings per 78.8 93.7 191.4 ordinary share-Group (cents) Adjusted HEPS-Industrial 78.8 66.2 141.6 operations (cents)
6. STATISTICS AND RATIOS Unaudited Unaudited Audited 6 months 6 months 12 months to to to
Statistics March 2007 March 2006 September 2006 Average no of ordinary shares in issue during the period and on which earnings per share are based (`000) 308,566 308,568 308,568 Ratios Interest cover (times) 18.4 22.7 31.9 Effective tax rate (%) 34.4 29.8 26.8 Gearing (%) 25.6 26.5 3.3 7. SEGMENTAL INFORMATION (Unaudited) 6 months ended 31 March 2007 Adjusted Industrial Total Industrial Operations Rm Operations % Change Revenue 17 2,110 2,110 Operating profit 23 392 392 Net profit for the period 18 240 240 BEPS (cents) 18 77.7 77.7 HEPS (cents) 19 78.8 78.8 Adjusted Results 6 months ended 31 March 2006
Adjusted Adjustment* Total Operations (Results as Previously Rm reported) Revenue 1,803 64 1,867 Operating profit 318 61 379 Net profit for the period 203 86 289 BEPS (cents) 65.9 27.6 93.5 HEPS (cents) 66.2 27.5 93.7 12 months ended 30 September 2006 Industrial Rm Operations Other** Total Revenue 3,914 - 3,914 Operating profit 684 70 754 Net profit for the period 437 421 858 BEPS (cents) 148.6 129.5 278.1 HEPS (cents) 141.6 49.8 191.4 *The adjustment relates to restatement of results; see note 7.1 below. **Relates to Life Healthcare earnings, profit on sale of the Life Healthcare investment, pension fund surplus and other non-recurring items. 7.1 Adjustment of Comparative Segmental Information for the six Months Period ended 31 March 2006. i) Exclusion of the results of Life Healthcare The results as at 31 March 2006 have been adjusted by the exclusion of the results of the share of associate, Life Healthcare`s profit. This associate was disposed of in 2006. The adjustment is the reduction in net profit by R56 million. ii) Restatement of cylinder rental income The treatment of annual cylinder rental contracts has been changed to recognise rental income as revenue over the period of the rental, even though billed and received annually. Therefore revenue and operating profit for the period ended 31 March 2006, has been adjusted by R42 million representing rental income not yet earned at that date. The effect on net profit is a reduction of R30 million. iii) Discounting of credit sales The treatment of credit sales has been adjusted by discounting these sales using the average debtors` collection period and prime lending rate. This is in line with the accounting policy adopted from September 2006. The revenue has been decreased by R22 million. Operating profit is not affected. 8. SUMMARISED CASHFLOW STATEMENT Unaudited Unaudited Audited 6 months to 6 months to 12 months to March 2007 March 2006 September
Rm 2006 Net cash (outflow)/inflow (250) (139) 46 from operating activities Net cash (outflow)/inflow (510) (202) 233 from investing activities Net cash inflow/(outflow) 435 233 (8) from financing activities Net (decrease)/increase in (325) (108) 271 cash and cash equivalents Cash and cash equivalents 433 162 162 at start of period Cash and cash equivalent 108 54 433 at end of period 9. SUMMARISED STATEMENT OF CHANGES IN EQUITY Issued Share Other Accumu- Minority Total Share lated
Rm Capital Premium Reserves Profits Interests Balance at 1 15 537 78 1,618 23 2,271 October 2006 Other - - (50) - - (50) movements Net profit - - - 240 3 243 for the period Dividend - - - (275) - (275) declared Balance at 15 537 28 1,583 26 2,189 31 March 2007 Balance at 1 1,644 October 2005 15 537 122 958 12 Other - - 5 (4) 7 8 movements Net profit - - - 289 2 291 for the period Dividend - - - (123) - (123) declared Balance at 15 537 127 1,120 21 1,820 31 March 2006 Date: 04/05/2007 14:53:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department.

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