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SNV - Santova Logistics - Abridged Results For The Year Ended 29 February 2008
SANTOVA LOGISTICS LIMITED
(www.Santova.com)
(Registration number 1998/018118/06)
(Share code: SNV & ISIN number: ZAE000090650)
ABRIDGED RESULTS
for the year ended 29 February 2008
CONDENSED GROUP INCOME STATEMENTS
As previously
reported
Twelve Restated Fourteen
months to Fourteen months to
29 February months to 28 February
2008 28 February 2007
REVIEWED 2007 AUDITED
R`000 R`000 R`000
Turnover 108 243 77 395 77 395
Gross billings 1 956 021 1 451 862 1 451 862
Cost of billings 1 847 778 1 374 467 1 374 467
Operating income 23 501 16 691 18 788
Depreciation and amortisation 2 369 1 638 1 709
Interest received 4 454 3 077 3 180
Finance costs 17 550 13 876 13 876
Profit before taxation 8 036 4 254 6 383
Income tax expense 1 965 1 649 2 330
Profit for the year/period 6 071 2 605 4 053
Attributable to:
Equity holders of the parent 6 026 2 625 4 073
Minority interests 45 (20) (20)
Basic earnings per share (cents) 0.45 0.24 0.44
Diluted earnings per share (cents) 0.45 0.24 0.35
SUPPLEMENTARY INFORMATION
Reconciliation between
earnings and headline earnings
Profit attributable to
equity holders of the parent 6 026 2 625 4 073
Profit on disposals of plant and
equipment (14) (158) (158)
Taxation effects 4 46 46
Headline earnings 6 016 2 513 3 961
Shares in issue (000`s) 1 366 788 1 122 682 1 122 682
Subscriptions awaiting
allotment (000`s) 8 569 222 855 222 855
Held by share trust - total (000`s) 91 335 63 306 63 306
Sold to trust participants -
ceded to trust (000`s) 45 968 52 551 52 551
Held by share trust - unsold (000`s) 45 367 10 755 10 755
Weighted average number
of shares (000`s) 1 335 522 1 091 394 931 823 906
Diluted number of shares (000`s) 1 335 522 1 091 394 1 154 677 377
Shares for net asset value
calculation (000`s) 1 329 990 1 334 783 931 823 906
Performance per ordinary share
Basic headline earnings per
share (cents) 0.45 0.23 0.43
Diluted headline earnings per
share (cents) 0.45 0.23 0.34
Net asset value per share (cents) 5.82 5.34 8.21
Tangible net asset per share (cents) 3.64 3.20 1.11
CONDENSED GROUP BALANCE SHEETS
As previously
reported
29 February Restated 28 February
2008 28 February 2007
REVIEWED 2007 AUDITED
R`000 R`000 R`000
ASSETS
Non-current assets 47 373 45 737 77 363
Plant and equipment 9 498 8 770 8 408
Intangible assets 793 766 405
Goodwill 28 236 27 846 65 731
Loans receivable 3 871 3 901 504
Deferred taxation 4 975 4 454 2 315
Current assets 282 918 286 110 296 028
Trade receivables 263 110 273 771 279 085
Other current assets 13 855 4 366 7 505
Financial assets 43 - -
Cash and cash equivalents 5 910 7 973 9 438
Total assets 330 291 331 847 373 391
EQUITY AND LIABILITIES
Capital and reserves 77 438 71 322 76 458
Share capital and premium 156 401 156 395 149 041
Foreign currency translation reserve 41 (3) (3)
Accumulated loss (79 043) (85 070) (72 580)
Attributable to equity holders of the
parent 77 399 71 322 76 458
Minority interest 39 - -
Non-current liabilities 2 658 3 276 44 462
Amounts owing to related parties - - 41 185
Interest-bearing borrowings 446 1 022 1 022
Long-term provision 2 212 2 254 2 255
Current liabilities 250 195 257 249 252 471
Current tax payable 940 278 278
Trade and other payables 112 480 104 939 99 518
Current portion of amounts owing to
related parties 120 - 643
Current portion of interest bearing
borrowings 772 791 791
Financial liability - 25 25
Short-term borrowings and overdraft 133 330 148 096 148 096
Short-term provisions 2 553 3 120 3 120
Total equity and liabilities 330 291 331 847 373 391
CONDENSED GROUP CASH FLOW STATEMENTS
As previously
reported
Twelve Restated Fourteen
months to Fourteen months to
29 February months to 28 February
2008 28 February 2007
REVIEWED 2007 AUDITED
R`000 R`000 R`000
Cash generated by operations
before working capital changes 23 606 19 188 21 355
Changes in working capital 8 134 (17 858) (18 052)
Cash generated by operating
activities 31 740 1 330 3 303
Interest received 4 454 3 077 3 180
Finance costs 17 550 13 876 13 876
Taxation paid 1 824 1 207 1 778
Net cash flows from operating
activities 16 820 (10 676) (9 171)
Net cash outflows from
investing activities (2 770) (1 525) (2 654)
Cash inflows on acquisition
of subsidiaries 289 10 110 10 121
Shares repurchased - - (788)
Borrowings repaid (16 402) (10 086) (8 220)
Net decrease in cash and cash
equivalents (2 063) (12 177) (10 712)
Cash and cash equivalents at
the beginning of the period 7 973 20 150 20 150
Cash and cash equivalents at
the end of the period 5 910 7 973 9 438
CONDENSED GROUP SEGMENTAL ANALYSIS
2008 - GEOGRAPHICAL Southern Africa Far East
R`000 R`000
Turnover 101 091 2 389
Net profit/(loss) before interest and tax 21 267 1 184
Net finance (cost)/revenue (12 987) (44)
Income tax (expense)/credit (2 206) (213)
Net profit/(loss) 6 074 927
Total assets 320 352 3 625
Total liabilities 244 406 2 720
Depreciation and amortization 2 294 13
Capital expenditure 3 268 3
2007 - GEOGRAPHICAL
Turnover 77 052 343
Net profit/(loss) before interest and tax 15 118 (65)
Net finance costs (10 799) -
Income tax expense (1 649) -
Net profit/(loss) 2 670 (65)
Total assets 330 424 1 423
Total liabilities 259 030 1 495
Depreciation and amortization 1 636 2
Capital expenditure 2 762 36
United Kingdom Group
R`000 R`000
Turnover 4 763 108 243
Net profit/(loss) before interest and tax (1 319) 21 132
Net finance (cost)/revenue (65) (13 096)
Income tax (expense)/credit 454 (1 965)
Net profit/(loss) (930) 6 071
Total assets 6 314 330 291
Total liabilities 5 727 252 853
Depreciation and amortization 62 2 369
Capital expenditure 410 3 681
2007 - GEOGRAPHICAL
Turnover - 77 395
Net profit/(loss) before interest and tax - 15 053
Net finance costs - (10 799)
Income tax expense - (1 649)
Net profit/(loss) - 2 605
Total assets - 331 847
Total liabilities - 260 525
Depreciation and amortization - 1 638
Capital expenditure - 2 798
2008 - BUSINESS SEGMENT Freight forwarding
and clearing Insurance Group
R`000 R`000 R`000
Net profit 5 530 541 6 071
Total assets 326 098 4 193 330 291
Total liabilities 251 776 1 078 252 854
2007 - BUSINESS SEGMENT
Net profit/(loss) 2 616 (11) 2 605
Total assets 331 271 576 331 847
Total liabilities 260 082 443 260 525
PRIOR PERIOD ADJUSTMENTS RECONCILIATION
As previously
reported Employee IAS 36/37
28 February share scheme Impairments
2007 changes and provisions
R`000 R`000 R`000
Balance Sheet Effects
Plant and equipment 8 408 - -
Intangible assets 405 - -
Goodwill 65 731 - -
Loans receivable 504 3 397 -
Deferred taxation 2 315 27 2 322
Trade receivables 279 085 - (5 314)
Other current assets 7 505 - (3 139)
Cash and cash equivalents 9 438 - (1 465)
Share capital and premium 149 041 3 326 -
Accumulated loss (72 580) (87) (12 853)
Amounts owing to related
parties 41 828 - -
Trade and other payables 99 518 - 5 421
Income Statement Effects
Interest received 3 180 (103) -
Administrative Expenses 61 108 (62) 2 159
Impairment of assets - 2 159
Other (62) -
Related taxation 2 330 (27) (296)
Restated
IFRS 3 and IAS 16 28 February
changes 2007
R`000 R`000
Balance Sheet Effects
Plant and equipment 362 8 770
Intangible assets 361 766
Goodwill (37 885) 27 846
Loans receivable - 3 901
Deferred taxation (210) 4 454
Trade receivables - 273 771
Other current assets - 4 366
Cash and cash equivalents - 7 973
Share capital and premium 4 028 156 395
Accumulated loss 450 (85 070)
Amounts owing to related parties (41 828) -
Trade and other payables - 104 939
Income Statement Effects
Interest received - 3 077
Administrative Expenses (71) 63 134
Impairment of assets -
Other (71)
Related taxation (358) 1 649
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
Attributable to equity holders of the parent
Share Share
capital premium
R`000 R`000
Audited Balances at 31 December 2005
As previously reported 900 110 161
Effect of prior years restatements:
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme changes - (16)
Restated balances at 31 December 2005 900 110 145
Net profit for the period - -
Net profit as previously reported - -
Reassessment of plant and equipment
under IAS16 and IFRS3 - -
Providing for subsidiary at acquisition tax liability - -
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme as previously reported - 55
Employee share scheme changes - (55)
Related deferred taxation - -
Share capital movements for period 223 23 015
Issue of shares as previously reported 223 41 915
Subscriptions awaiting allotment - -
Reduction of share price on acquisition of subsidiary - (18 900)
Treasury shares as previously reported - -
Restatement of treasury shares - -
Foreign currency translation adjustment - -
Minority interest acquired - -
Minority interest allocated against the parent - -
Restated balances at 28 February 2007 1 123 133 160
Net profit for the year/period - -
Minority interest adjustment - -
Reversal of minority interest allocated against the
parent - -
Issue of share capital 244 25 125
Foreign currency translation adjustment - -
Shares repurchased - -
Reviewed Balances at 29 February 2008 1 367 158 285
Attributable to equity holders of the parent
Treasury Treasury
share capital share premium
R`000 R`000
Audited Balances at 31 December 2005
As previously reported (51) (3 319)
Effect of prior years restatements:
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme changes 39 2 515
Restated balances at 31 December 2005 (12) (804)
Net profit for the period - -
Net profit as previously reported - -
Reassessment of plant and equipment
under IAS16 and IFRS3 - -
Providing for subsidiary at acquisition tax
liability - -
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme as previously reported - -
Employee share scheme changes - -
Related deferred taxation - -
Share capital movements for period 1 (1)
Issue of shares as previously reported - -
Subscriptions awaiting allotment - -
Reduction of share price on acquisition of
subsidiary - -
Treasury shares as previously reported (13) (830)
Restatement of treasury shares 14 829
Foreign currency translation adjustment - -
Minority interest acquired - -
Minority interest allocated against the
parent - -
Restated balances at 28 February 2007 (11) (805)
Net profit for the year/period - -
Minority interest adjustment - -
Reversal of minority interest allocated
against the parent - -
Issue of share capital (24) (2 975)
Foreign currency translation adjustment - -
Shares repurchased (10) (711)
Reviewed Balances at 29 February 2008 (45) (4 491)
Attributable to equity holders of the parent
Foreign
Subscriptions currency
awaiting translation
allotment reserve
R`000 R`000
Audited Balances at 31 December 2005
As previously reported - -
Effect of prior years restatements:
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme changes - -
Restated balances at 31 December 2005 - -
Net profit for the period - -
Net profit as previously reported - -
Reassessment of plant and equipment
under IAS16 and IFRS3 - -
Providing for subsidiary at acquisition tax
liability - -
IAS 36/37 impairments and provisions - -
Related deferred taxation - -
Employee share scheme as previously reported - -
Employee share scheme changes - -
Related deferred taxation - -
Share capital movements for period 22 928 -
Issue of shares as previously reported - -
Subscriptions awaiting allotment 41 828 -
Reduction of share price on acquisition of
subsidiary (18 900) -
Treasury shares as previously reported - -
Restatement of treasury shares - -
Foreign currency translation adjustment - (3)
Minority interest acquired - -
Minority interest allocated against the parent - -
Restated balances at 28 February 2007 22 928 (3)
Net profit for the year/period - -
Minority interest adjustment - -
Reversal of minority interest allocated
against the parent - -
Issue of share capital (21 643) -
Foreign currency translation adjustment - 44
Shares repurchased - -
Reviewed Balances at 29 February 2008 1 285 41
Attributable to equity holders of the parent
Accumulated
loss Total
R`000 R`000
Audited Balances at 31 December 2005
As previously reported (76 652) 31 039
Effect of prior years restatements:
IAS 36/37 impairments and provisions (13 084) (13 084)
Related deferred taxation 2 026 2 026
Employee share scheme changes 16 2 554
Restated balances at 31 December 2005 (87 694) 22 535
Net profit for the period 2 625 2 625
Net profit as previously reported 4 073 4 073
Reassessment of plant and equipment
under IAS16 and IFRS3 71 71
Providing for subsidiary at acquisition tax
liability 427 427
IAS 36/37 impairments and provisions (2 159) (2 159)
Related deferred taxation 227 227
Employee share scheme as previously reported - 55
Employee share scheme changes (41) (96)
Related deferred taxation 27 27
Share capital movements for period - 46 166
Issue of shares as previously reported - 42 138
Subscriptions awaiting allotment - 41 828
Reduction of share price on acquisition of
subsidiary - (37 800)
Treasury shares as previously reported - (843)
Restatement of treasury shares - 843
Foreign currency translation adjustment - (3)
Minority interest acquired - -
Minority interest allocated against the parent (1) (1)
Restated balances at 28 February 2007 (85 070) 71 322
Net profit for the year/period 6 026 6 026
Minority interest adjustment - -
Reversal of minority interest allocated against
the parent 1 1
Issue of share capital - 727
Foreign currency translation adjustment - 44
Shares repurchased - (721)
Reviewed Balances at 29 February 2008 (79 043) 77 399
Minority Total
interest equity
R`000 R`000
Audited Balances at 31 December 2005
As previously reported - 31 039
Effect of prior years restatements:
IAS 36/37 impairments and provisions - (13 084)
Related deferred taxation - 2 026
Employee share scheme changes - 2 554
Restated balances at 31 December 2005 - 22 535
Net profit for the period (20) 2 605
Net profit as previously reported (20) 4 053
Reassessment of plant and equipment
under IAS16 and IFRS3 - 71
Providing for subsidiary at acquisition tax liability - 427
IAS 36/37 impairments and provisions - (2 159)
Related deferred taxation - 227
Employee share scheme as previously reported - 55
Employee share scheme changes - (96)
Related deferred taxation - 27
Share capital movements for period - 46 166
Issue of shares as previously reported - 42 138
Subscriptions awaiting allotment - 41 828
Reduction of share price on acquisition of subsidiary - (37 800)
Treasury shares as previously reported - (843)
Restatement of treasury shares - 843
Foreign currency translation adjustment - (3)
Minority interest acquired 19 19
Minority interest allocated against the parent 1 -
Restated balances at 28 February 2007 - 71 322
Net profit for the year/period 45 6 071
Minority interest adjustment (5) (5)
Reversal of minority interest allocated against the
parent (1) -
Issue of share capital - 727
Foreign currency translation adjustment - 44
Shares repurchased - (721)
Reviewed Balances at 29 February 2008 39 77 438
COMMENTARY
Group profile
Santova Logistics Limited and its subsidiary companies "Santova / Group",
operating out of South Africa, the United Kingdom, Hong Kong and China,
provide integrated "end-to-end" logistics solutions for importers, exporters
and consumers
worldwide.
Changes in the Group
The Group acquired Mogal International Limited "Mogal", which operates out of
the United Kingdom, with effect from 13 March 2007. The purchase consideration
of R1,984,174 comprises R654,272 worth of goodwill and net assets acquired to
the value of R1,329,902 made up of plant and equipment; accounts receivable;
other current assets; cash and cash equivalents; and trade and other payables.
The contribution of the Mogal operation to the Group`s results and net assets
is reflected in the segmental report which forms part of these abridged
results.
Following the acquisition of Impson Logistics (Pty) Ltd "Impson Logistics"
during the previous financial year, significant progress has been made in
rationalising the South African branch network and standardising operating
procedures and accounting policies.
As part of the rationalisation, the Group has appointed a single audit firm to
all group operations, except for the newly acquired Mogal.
Financial reporting and accounting policy changes
These reviewed abridged results reflect certain changes to the previously
reported financial information of the Group for the 14 month period to 28
February 2007 and the interim information for the 6 months to 31 August 2007.
These changes arise in the main from an assessment undertaken by the directors
of the application of existing and revised accounting standards in the
following areas (the values are reflected in the "prior period adjustments
reconciliation" in the same order as listed below):
1. changing the basis of accounting for the employee share purchase scheme;
2. implementing consistent provisioning and impairment policies across the
Group;
3. reassessing the fair values of the businesses of the recently acquired
subsidiary companies, as well as the valuation placed on the Santova shares
issued and issuable to the vendors of those businesses; and
4. making disclosure changes to achieve compliance with new and revised
International Financial Reporting Standards.
The rationalisation of the Santova operations highlighted the need to
standardise the processes for providing for possible impairments and also
crystallised a significant core of long overdue amounts in the accounts
receivable balances of the old "Spectrum" businesses. The standardisation of
accounting policies across Santova has resulted in increased provisions to
reflect possible impairments in accounts receivable. Where appropriate, the
results and balances in prior periods have been restated.
Basis of preparation
Except for the differences highlighted above, the accounting policies are
consistent with those applied in the financial statements for the 14 months
ended 28 February 2007.
The financial information has been prepared using accounting policies that
comply with International Financial Reporting Standards. The Group has adopted
IFRS 7 Financial Instruments: Disclosures. This is a disclosure standard which
has no impact on the recognition, measurement or presentation of financial
instruments and consequently has no impact on profit, loss or equity for the
year.
This preliminary, abridged report complies with International Accounting
Standard 34 - Interim Financial Reporting as well as with Schedule 4 of the
South African Companies Act and the disclosure requirements of the JSE Listings
Requirements.
Overview of 2008 performance
The Group`s performance as reflected in this preliminary report, which includes
the cost of the Durban and Head Office move in early March 2007, shows that
good progress is being made in achieving the strategic growth objectives of the
Group.
The balance sheet remains strong, with NAV (Net Asset Value) having increased
from 5,34 cents per share to 5,82 cents per share, an 8,9% increase; whilst
the TNAV (Tangible Net Asset Value) has moved from 3,20 cents per share to
3,64 cents per share, a 13,7% increase.
The cash flow statement reflects a significant decline in the usage of the
invoice discounting facility which has decreased from a net borrowings amount
of R140,1m to R127,4m, despite the increased trade undertaken by the group.
During the year, further shares were issued as follows:
- 4,818,750 shares to the vendors of Mogal on 13 March 2007;
- 210,000,000 shares to the vendors of Impson Logistics on 18 June 2007;
- 4,286,490 shares to the vendors of Leading Edge Insurance Brokers (Pty) Ltd
on
18 June 2007; and
- 25,000,000 shares to the share trust on 30 September 2007.
Outlook for 2008/9
We move forward in the year ahead with a strong focus on customer service and
cost optimisation.
REVIEW BY INDEPENDENT AUDITORS
The Group`s auditors, Deloitte & Touche, have reviewed these year end results.
Their unmodified review report is available for inspection at the Group`s
registered office during office hours.
OTHER MATTERS
The annual report will be issued in due course, both in electronic and printed
form.
DIVIDENDS
In line with the Company`s policy, no dividend has been declared for the year.
For and on behalf of the board,
GH Gerber SJ Chisholm
Chief Executive Officer Group Financial Director
4 June 2008
REGISTERED OFFICE AND POSTAL ADDRESS
Santova House, 88 Mahatma Gandhi Road, Durban, 4001; P O Box 6148, Durban, 4000
TRANSFER SECRETARIES
Computershare Investor Services (Pty) Ltd
70 Marshall Street, Marshalltown, 2107
DESIGNATED ADVISORS
River Group
AUDITORS
Deloitte & Touche
EXECUTIVE DIRECTORS
SJ Chisholm (GFD), S Donner, GH Gerber (CEO), MF Impson, TR Mezher, R Singh
INDEPENDENT NON-EXECUTIVE DIRECTORS
M Tembe, S Zulu (Chairman)
COMPANY SECRETARY
J A Lupton, ACIS
Date: 04/06/2008 07:52:10 Supplied by www.sharenet.co.za
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