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TMT - Trematon Capital Investments Ltd - Unaudited interim results for the six
months ended 29 February 2008
TREMATON CAPITAL INVESTMENTS LTD
(Incorporated in the Republic of South Africa)
(Registration number 1997/008691/06)
Share code: TMT ISIN: ZAE000013991
("Trematon" or "the company")
Unaudited interim results for the six months ended 29 February 2008
Balance sheet
Unaudited Audited
29/28 February 31 August
2008 2007 2007
R`000 R`000 R`000
ASSETS
Non-current assets 231 212 90 260 102 397
Equipment 10 15 104
Investment in joint venture 7 310 5 438 7 488
Investments 175 524 84 807 91 841
Loans receivable 47 920 - 2 964
Deferred tax asset 448 - -
Current assets 10 548 73 790 61 569
Investments 8 489 15 312 -
Tax receivable 154 69 148
Trade and other receivables 149 16 473 1 520
Cash and cash equivalents 1 756 41 936 59 901
Total assets 241 760 164 050 163 966
EQUITY AND LIABILITIES
Equity 163 033 129 484 153 627
Share capital and share premium 203 296 203 296 203 296
Fair value reserve 40 627 19 537 40 249
Accumulated loss (80 890) (100 358) (97 115)
Total equity attributable to equity
holders of the parent 163 033 122 475 146 430
Minority interest - 7 009 7 197
Non-current liabilities 46 532 5 290 8 388
Long-term loan 39 918 - -
Deferred tax liability 6 614 5 290 8 388
Current liabilities 32 195 29 276 1 951
Loan payable 30 277 - -
Tax payable 927 2 823 1 784
Trade and other payables 947 26 453 153
Bank overdraft 44 - 14
Total equity and liabilities 241 760 164 050 163 966
Net asset value per share (cents) 93 70 84
Income statement
Unaudited Audited
Six months Year
ended ended
29/28 February 31 August
2008 2007 2007
Notes R`000 R`000 R`000
Revenue 21 548 9 778 18 449
Trading profit 15 590 4 627 6 404
Investment income 3 268 2 772 6 371
Finance costs (1 643) (94) (792)
Profit/(loss) from equity accounted
investments (net of tax) 93 (359) (247)
Profit before taxation 17 308 6 946 11 736
Taxation (661) (1 817) (2 662)
Profit for the period/year 16 647 5 129 9 074
Attributable to:
Equity holders of the parent 16 225 4 872 8 115
Minority interest 422 257 959
16 647 5 129 9 074
Number of shares issued (thousands) 174 873 174 873 174 873
Weighted average number of shares
(thousands) 174 873 174 873 174 873
Basic earnings per share (cents) 9.3 2.8 4.6
Headline earnings per share (cents) 2 0.9 1.7 1.5
Cash flow statement
Unaudited Audited
Six months Year
ended ended
29/28 February 31 August
2008 2007 2007
R`000 R`000 R`000
Cash flow from operating activities
Cash generated by/(used in) operations 3 577 6 626 (7 653)
Interest received 2 156 2 244 4 906
Dividends received 1 112 528 1 465
Finance costs (1 643) (94) (792)
Tax paid (249) (3 838) (6 294)
Net cash from operating activities 4 953 5 466 (8 368)
Cash flow from investing activities
Acquisition of equipment - - (91)
Acquisition of subsidiary, net of
cash acquired - 8 162 8 162
Dilution of shareholding in subsidiary,
net of cash (23 929) - -
Increase in loans receivable (44 285) - (2 964)
Loan advanced to joint venture (897) (720) (3 016)
Acquisition of investments (70 075) (36 525) (49 655)
Proceeds from sale of investments 5 864 42 764 93 034
Net cash from investing activities (133 322) 13 681 45 470
Cash flow from financing activities
Increase in loans payable 70 196 - -
Net cash from financing activities 70 196 - -
Net (decrease)/increase in cash and
cash equivalents (58 173) 19 147 37 102
Cash and cash equivalents at beginning
of period/year 59 887 22 789 22 788
Effect of exchange rate movement on
cash balances (2) - (3)
Total cash and cash equivalents at end
of the period/year 1 712 41 936 59 887
Statement of changes in equity
Unaudited Audited
Six months Year
ended ended
29/28 February 31 August
2008 2007 2007
R`000 R`000 R`000
Total equity at 1 September 153 627 105 161 105 161
Total recognised income 27 129 18 332 42 514
Profit for the period attributable to equity
holders of the parent 16 225 4 872 8 115
Profit for the period attributable to
minority interest 422 257 959
Fair value gains on available-for-sale
investments attributable to equity holders
of the parent 10 482 10 974 28 646
Fair value gain on available-for-sale
investments attributable to minority interest - 761 286
Fair value loss on available-for-sale
investments realised through income statement - 1 468 4 508
Acquisition of subsidiary - 5 991 5 952
Dilution of shareholding in subsidiary
attributable to equity holders of the
parent (10 104) - -
Dilution of shareholding in subsidiary
attributable to minority interest (7 619) - -
Total equity at 29/28 February/31 August 163 033 129 484 153 627
Notes
1 The interim financial statements were prepared in accordance with
International Financial Reporting Standards (IFRS), IAS 34 - Interim Financial
Reporting, the Listing Requirements of the JSE Ltd and the South African
Companies Act.
The accounting policies used in the preparation of this interim financial report
are consistent with those used in prior periods.
Unaudited Audited
Six months Year
ended ended
29/28 February 31 August
2008 2007 2007
R`000 R`000 R`000
2 Headline earnings per share
Headline earnings per share is calculated
as follows:
Profit attributable to equity holders of the
parent 16 225 4 872 8 115
Realised gain on change in shareholding (12 609) - -
Realised profit on available-for-sale
investments in associate (2 282) - -
Realised profit on available-for-sale
investments - (2 262) (6 206)
Tax effects 319 302 786
Headline earnings 1 653 2 912 2 695
Headline earnings per share (cents) 0.9 1.7 1.5
The calculation of headline earnings per share is based on the weighted average
number of 174 872 545 shares in issue during the year (2007: 174 872 545).
Comment
Directors` report
The interim reporting period presents both a broadened investment portfolio and
further investment in the company`s existing assets.
The most significant new investment since year-end was the purchase of an
indirect attributable interest of 7.2% in Mazor Group Ltd ("Mazor"). Mazor
specialises in the design, supply and installation of structural steelwork
and aluminium facades. The details of the transaction were provided on sens on
22 November 2007. Mazor is listed on AltX and further information can be found
at www.mazor.co.za.
Additional investments were made in Club Mykonos Langebaan Ltd, Grand Parade
Investments Ltd and the existing property portfolio.
Short-term trading activity was very limited during the period and small
unrealised trading losses were incurred.
Most of the company`s assets are held as long-term investments. As a result,
changes in the value of these investments are not reflected in headline
earnings but are taken to a fair value reserve in terms of IFRS.
Trading profit for the period amounted to R15.6 million (2007: R4.6 million).
The total operating expenses for the period, including directors` emoluments,
amounted to R2.7 million. Basic eps amounted to 9.3c per share (2007: 2.8c) and
headline eps to 0.9c (2007: 1.7c). The difference between basic eps and
headline eps is due to the profit earned on SA REIT Ltd during the period being
excluded from headline eps (see below).
Net asset value at the end of the period was 93c per share (2007: 70c). Gross
assets increased to R241 million (2007: R164 million), most of the increase in
investments was funded by borrowings.
Club Mykonos Langebaan Ltd ("CML")
Trematon owns 11.5 million shares (33% of the total equity) in CML. Subsequent
to the end of the current reporting period, at a general meeting held on
24 April 2008 shareholders obtained board representation for the first time and
four Trematon directors were elected on to the board. CML is a public company
which owns land and commercial assets on the West Coast. Trematon will play an
active role in extracting maximum value for all CML shareholders over the next
few years. CML`s assets include approximately 30% of Mykonos Casino which is
controlled and managed by Gold Reef Resorts Ltd.
Grand Parade Investments Ltd ("GPI")
Trematon has an attributable interest in 13.7 million shares (3.7% of the total
equity) in GPI which in turn has an indirect interest in the Grand West Casino
and other leisure and gaming assets. For further information, shareholders are
referred to GPI`s website at www.grandparade.co.za.
Property Portfolio
Trematon owns 121 million shares (19% of the total equity) in SA REIT Ltd and
is represented on the board of SA REIT Ltd. Shareholders are referred to SA
REIT Ltd`s interim results announcement published on 23 April 2008. SA REIT Ltd
was a subsidiary at the previous year-end and for one month of the current
period. Subsequent to this SA REIT Ltd raised capital via the issue of new
shares and, although Trematon invested further capital, it is no longer a
subsidiary. The consequent change in the basis of accounting for SA REIT Ltd
gave rise to a gain of R12.6 million which is reflected as trading profit.
The joint venture with Gateway Property Developments at the Broadway Park
Industrial Estate consists of 98 000 m2 of industrial and commercial land in
the Strand. The project is well advanced. Perfected sales amount to 67% of the
total project and it is expected to make a contribution to profits in the
current financial year.
The Boulevard Park Development, in which Trematon has a 37.5% interest, is
managed by Faircape Property Developers cc ("Faircape"). The development is on
the CBD periphery and will consist of 36 000 m2 of office space in seven towers
with 1 800 parking bays. Construction has commenced and is expected to be
completed by March 2009. Five out of the seven towers have been sold and this
project is expected to contribute to profits in the 2009 financial year.
Trematon has an interest of 40% in the New Wembley Trust (also managed by
Faircape) which is an office development directly opposite Wembley Square in
Gardens, Cape Town. This project is in the early planning stages.
Prospects
The primary focus of management is on the long-term growth of per share net
asset value. Some of the projects and investments embarked on in previous years
will start to bear fruit in the financial years ending August 2008 and 2009 and
the next two years are expected to show positive results assuming there are no
material changes in the investment portfolio.
On behalf of the board
AJ SHAPIRO
Director
Cape Town
9 May 2008
Directors: M Kaplan* (Chairman), A Shapiro (CEO), A Groll, AM Louw*,
R Stumpf* *non-executive
Domicile and registered office: 42 Hans Strijdom Avenue, Foreshore, Cape Town,
8001
Postal address: PO Box 7677, Roggebaai, 8012, South Africa. Tel: 021 421-5550.
Fax: 021 421-5551
Secretary: S Litten (Incorporated in the Republic of South Africa) (Registration
number 1997/008691/06)
Share code: TMT ISIN: ZAE000013991
Transfer secretaries: Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg, 2001
Auditor: KPMG Inc. Sponsor: Sasfin Bank Limited
Date: 09/05/2008 12:56:01 Supplied by www.sharenet.co.za
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