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CSB - Cashbuild Limited - Audited group annual financial results and dividend
declaration June 2010
Cashbuild Limited
(Registration number: 1986/001503/06)
(Incorporated in the Republic of South Africa)
Listed on the JSE Limited
JSE Share Code: CSB ISIN: ZAE000028320
AUDITED GROUP ANNUAL FINANCIAL RESULTS AND DIVIDEND DECLARATION JUNE 2010
Net asset value per share up 19% Final dividend up 23% Revenue up 6%
Operating profit down 5% Headline earnings down 8%
CONDENSED GROUP INCOME STATEMENT - AUDITED
Year ended Year ended
30 June 30 June %
R`000 2010 2009 change
Revenue 5 369 146 5 065 843 6
Cost of sales (4 216 241) (4 003 162) 5
Gross profit 1 152 905 1 062 681 8
Selling and marketing expenses (776 838) (694 145) 12
Administrative expenses (132 470) (114 001) 16
Other operating expenses (5 398) (3 883) 39
Other income 1 245 626 99
Operating profit 239 444 251 278 (5)
Finance cost (5 700) (1 864) 206
Finance income 21 936 25 622 (14)
Profit before income tax 255 680 275 036 (7)
Income tax expense (82 005) (86 309) (5)
Profit for the year 173 675 188 727 (8)
Attributable to:
Owners of the company 163 776 177 056 (8)
Non-controlling interests 9 899 11 671 (15)
173 675 188 727 (8)
Earnings per share (cents) 721.2 779.7 (8)
Diluted earnings per share (cents) 717.7 779.5 (8)
CONDENSED GROUP STATEMENT OF COMPREHENSIVE INCOME - AUDITED
Year ended Year ended
30 June 30 June
R`000 2010 2009
Profit for the year 173 675 188 727
Other comprehensive income:
Foreign currency translation adjustments (5 075) (2 399)
Other comprehensive income for the year,
net of tax (5 075) (2 399)
Total comprehensive income for the year 168 600 186 328
Total comprehensive income attributable to:
Owners of the company 158 701 174 657
Non-controlling interests 9 899 11 671
168 600 186 328
ADDITIONAL INFORMATION - AUDITED
Year ended Year ended
30 June 30 June
R`000 2010 2009
Net asset value per share (cents) 2 703 2 265
Ordinary shares (`000):
- In issue 25 805 25 805
- Weighted-average 22 709 22 709
- Diluted weighted-average 22 821 22 715
Capital expenditure 137 849 122 904
Depreciation of property, plant and equipment 48 002 39 784
Amortisation of intangible assets 709 2 636
Capital commitments 104 744 211 612
Property operating lease commitments 891 907 801 165
Contingent liabilities 17 910 7 434
CONDENSED GROUP STATEMENT OF FINANCIAL POSITION - AUDITED
30 June 30 June
R`000 2010 2009
ASSETS
Non-current assets 462 763 377 757
Property, plant and equipment 425 293 344 176
Intangible assets 28 149 22 280
Deferred income tax asset 9 321 11 301
Current assets 1 398 498 1 340 639
Assets held for sale 659 2 740
Inventories 784 445 907 712
Trade and other receivables 71 114 82 057
Cash and cash equivalents 542 280 348 130
Total assets 1 861 261 1 718 396
EQUITY AND LIABILITIES
Shareholders` equity 749 606 628 234
Share capital and reserves 697 466 584 555
Non-controlling interests 52 140 43 679
Non-current liabilities 71 496 58 338
Deferred operating lease liability 67 318 54 409
Deferred profit 1 751 1 803
Borrowings (non interest-bearing) 2 427 2 126
Current liabilities 1 040 159 1 031 824
Trade and other liabilities 1 018 360 1 005 771
Current income tax liabilities 19 781 23 703
Employee benefits 2 018 2 350
Total equity and liabilities 1 861 261 1 718 396
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY - AUDITED
R`000 Attributable to equity holders of the company
Share Cum.
Treasury based trans- Non-
Share share Treasury pay- lation controlling
capi- capi- Share share ment adjust- Retained inte- Total
tal tal premium premium reserve ments earnings rests equity
Balance at 1 July 2008
258 (29) 115 817 (83 686) - (4 167) 442 774 34 142 505 109
Total comprehensive income for the year
- - - - - (2 399) 177 056 11 671 186 328
Dividend paid
- - - - - - (61 544) (2 134) (63 678)
Recognition of share based payments
- - - - 475 - - - 475
Closing balance at 30 June 2009
258 (29) 115 817 (83 686) 475 (6 566) 558 286 43 679 628 234
Total comprehensive income for the year
- - - - - (5 075) 163 776 9 899 168 600
Dividend paid
- - - - - - (47 466) (1 438) (48 904)
Recognition of share based payments
- - - - 1 676 - - - 1 676
Closing balance at 30 June 2010
258 (29) 115 817 (83 686) 2 151 (11 641) 674 596 52 140 749 606
CONDENSED GROUP CASH FLOW STATEMENT - AUDITED
Year ended Year ended
30 June 30 June
R`000 2010 2009
Cash flows from operating activities
Cash generated from operations 448 595 223 577
Interest paid (5 700) (1 864)
Taxation paid (83 947) (94 504)
Net cash generated from operating activities 358 948 127 209
Cash flows from investing activities
Net investment in assets (134 373) (122 659)
Interest received 21 936 25 622
Net cash used in investing activities (112 437) (97 037)
Cash flows from financing activities
Increase in other borrowings 301 259
Dividends paid
- own equity (47 466) (61 544)
- non-controlling interests (1 438) (2 134)
Net cash used in financing activities (48 603) (63 419)
Net increase/(decrease) in cash and cash
equivalents 197 908 (33 247)
Effect of exchange rate movements on cash
and cash equivalents (3 758) (1 586)
Cash and cash equivalents at beginning
of year 348 130 382 963
Cash and cash equivalents at end
of year 542 280 348 130
CONDENSED GROUP SEGMENTAL ANALYSIS - AUDITED
South Africa
Year ended Year ended
30 June 30 June
R`000 2010 2009
Income statement
Revenue 4 533 300 4 182 746
Operating profit 195 314 169 122
Balance sheet
Segment assets 1 543 791 1 394 443
Segment liabilities 976 272 920 939
Other segment items
Depreciation 43 447 35 365
Amortisation 674 2 592
Capital expenditure 131 755 111 401
Other members of common monetary area*
Year ended Year ended
30 June 30 June
R`000 2010 2009
Income statement
Revenue 521 264 487 327
Operating profit 27 653 29 503
Balance sheet
Segment assets 196 137 192 720
Segment liabilities 75 096 90 936
Other segment items
Depreciation 2 795 3 028
Amortisation - -
Capital expenditure 1 967 10 210
*Includes Namibia, Swaziland and Lesotho
Botswana and Malawi
Year ended Year ended
30 June 30 June
R`000 2010 2009
Income statement
Revenue 314 582 395 770
Operating profit 16 477 52 653
Balance sheet
Segment assets 121 333 131 233
Segment liabilities 60 287 78 287
Other segment items
Depreciation 1 760 1 391
Amortisation 35 44
Capital expenditure 4 127 1 293
Group
Year ended Year ended
30 June 30 June
R`000 2010 2009
Income statement
Revenue 5 369 146 5 065 843
Operating profit 239 444 251 278
Balance sheet
Segment assets 1 861 261 1 718 396
Segment liabilities 1 111 655 1 090 162
Other segment items
Depreciation 48 002 39 784
Amortisation 709 2 636
Capital expenditure 137 849 122 904
NOTES TO THE CONDENSED GROUP ANNUAL FINANCIAL INFORMATION
1. Basis of preparation. The condensed consolidated financial information
("financial information") announcement is based on the audited financial
statements of the group for the year ended 30 June 2010 which have been
prepared in accordance with International Financial Reporting Standards
("IFRS"), the Listings Requirements of the JSE and the South African Companies
Act (1973). The accounting policies are consistent with those used in the annual
financial statements for the financial year ended June 2009 with the following
exceptions: The group adopted the revised IAS 1, Presentation of Financial
Statements, IFRS 8, Operating Segments and Circular 3/2009 on Headline Earnings
during the period under review. The presentation of the financial statements and
operating segments disclosures have been changed accordingly to the changes in
IAS 1 and IFRS 8 respectively, with no adjustment necessary on the adoption of
Circular 3/2009.
2. Independent audit by the auditors. These condensed consolidated results have
been audited by our auditors PricewaterhouseCoopers Inc., who have performed
their audit in accordance with the International Standards on Auditing. A copy
of their unqualified audit report is available for inspection at the registered
office of the company.
3. Reporting period. The group adopts the retail accounting calendar, which
comprises the reporting period ending on the last Saturday of the month (2010:
26 June (52 weeks); 2009: 27 June (52 weeks)).
4. Earnings per share. Earnings per share is calculated by dividing the earnings
attributable to owners of the company for the year by the weighted average
number of 22 709 487 ordinary shares in issue during the year.(June 2009: 22 709
487 shares).
5. Headline earnings per ordinary share. The calculations of headline earnings
and diluted headline earnings per ordinary share are based on headline earnings
of R162.9 million (June 2009: R177.4 million) and a weighted average of 22 709
487 (June 2009: 22 709 487) and fully diluted of 22 820 888 (June 2009: 22 715
519) ordinary shares in issue.
Reconciliation between net profit attributable to the owners of the company and
headline earnings:
%
R`000 Jun-10 Jun-09 change
Net profit attributable to the owners of
the company 163 776 177 056 (8)
(Profit)/loss on sale of assets after
taxation (902) 353
Headline earnings 162 874 177 409 (8)
Headline earnings per share (cents) 717.2 781.2 (8)
Diluted headline earnings per share (cents) 713.7 781.0 (9)
6. Declaration of dividend. The board has declared a final dividend (No. 34), of
127 cents (June 2009: 103 cents) per ordinary share to all shareholders of
Cashbuild Limited. The dividend per share is calculated based on 25 805 347
(2009: 25 805 347) shares in issue at date of dividend declaration. The total
dividend for the year amounts to 233 cents (2009: 246 cents) a 5% decrease year
on year.
Date dividend declared: Monday, 20 September 2010.
Last day to trade "CUM" the dividend: Friday, 8 October 2010.
Date commence trading "EX" the dividend: Monday, 11 October 2010.
Record date: Friday, 15 October 2010.
Date of payment: Monday, 18 October 2010.
Share certificates may not be dematerialised or rematerialised between Monday,
11 October 2010 and Friday, 15 October 2010, both dates inclusive.
On behalf of the board
DONALD MASSON PAT GOLDRICK
Chairman Chief executive
Johannesburg Date: 20 September 2010
NATURE OF BUSINESS
Cashbuild is southern Africa`s largest retailer of quality building materials
and associated products, selling direct to a cash-paying customer-base through
our constantly expanding chain of stores (189 at the end of this reporting
year). Cashbuild carries an in-depth quality product range tailored to the
specific needs of the communities we serve. Our customers are typically home-
builders and improvers, contractors, farmers, traders, large construction
companies and government-related infrastructure developers, as well as all other
customers requiring quality building materials at lowest prices.
Cashbuild has built its credibility and reputation by consistently offering its
customers quality building materials at the lowest prices and through a
purchasing and inventory policy that ensures customers` requirements are always
met.
INTERNATIONAL FINANCIAL REPORTING STANDARDS
The group is reporting its audited results in accordance with International
Financial Reporting Standards ("IFRS").
FINANCIAL HIGHLIGHTS
Revenue for the year increased by 6% whilst operating profit decreased by 5%.
This decrease in profit was as a result of an increase in gross profit of 8%,
whilst operating expenses increased by 13%. Basic earnings per share decreased
by 8% and headline earnings per share decreased by 8%. Net asset value per share
has shown a 19% increase, from 2 265 cents (June 2009) to 2 703 cents. Cash and
cash equivalents increased by 56% to R542 million.
Stores in existence since the beginning of July 2008 (pre-existing stores - 168
stores) accounted for 2% of the increase in revenue with the remaining 4%
increase due to the 21 new stores the group has opened since July 2008. This
increase for the year has been achieved in tough trading conditions with selling
price inflation of 2%. The growth in customer transactions of 9% (of which 3% is
from the existing store base) is encouraging and bodes well for the future.
Despite the competitive environment, gross profit percentage margin increased to
21.5% during this year and was 0.5% higher in percentage terms than the 21.0%
achieved for the comparative year.
Operational expenses for the year remained well controlled with existing stores
accounting for 8% of the increase and new stores 5%. The total increase for the
year amounted to 13%. The main contributor to the increase on existing stores is
the people cost component in order to maintain and improve customer service
standards.
The effective tax rate for the year of 32.1% is 0.7% higher than that of the
previous year, mainly due to an increase in non-allowable expenditure.
Cashbuild`s statement of financial position remains solid. Stock levels have
decreased by 14%. This decrease is in spite of the stocking of eight additional
stores since the previous year-end. Overall stockholding at 72 days (June 2009:
84 days) showed an improvement on the position as at June 2009. Trade
receivables remain well under control.
During the year Cashbuild opened eight new stores. Four stores were refurbished
and one store relocated. Cashbuild will continue its store expansion, relocation
and refurbishment strategy in a controlled manner, applying the same rigid
process as in the past.
PROSPECTS
Management remains optimistic about the top line trading prospects for the next
quarter. The first nine trading weeks since year-end have reported an increase
in revenue of 5% on that of the comparable nine weeks. Gross profit percentage
margins are expected to remain at similar levels to that achieved during the
financial year under review.
Directors: D Masson* (Chairman), PK Goldrick (Chief executive) (Irish), WF de
Jager, J Molobela*, KB Pomario, FM Rossouw*, NV Simamane*, SA Thoresson, A van
Onselen
(*non-executive)
Company secretary: Corporate Governance Leaders CC
Registered office: cnr Aeroton and Aerodrome Roads, Aeroton, Johannesburg 2001.
PO Box 90115, Bertsham 2013
Transfer secretaries: Computershare Investor Services (Pty) Limited,
70 Marshall Street, Johannesburg 2001. PO Box 61051, Marshalltown 2107
Auditors: PricewaterhouseCoopers Inc.
Sponsor: Nedbank Capital
QUALITY BUILDING MATERIALS AT THE LOWEST PRICES
www.cashbuild.co.za
21 September 2010
Date: 21/09/2010 08:00:03 Supplied by www.sharenet.co.za
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