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RAH - Real Africa Holdings Ltd - Profit and dividend announcement for the six months ended 31 December 2010 Real Africa Holdings Ltd Incorporated in the Republic of South Africa Registration number 1994/003919/06 Share code: RAH ISIN code: ZAE000008702 ("Real Africa" or "RAH" or "the company") Profit and dividend announcement for the six months ended 31 December 2010 GROUP STATEMENTS OF COMPREHENSIVE INCOME Six months ended Year ended 31 December 30 June
R`000 2010 2009 2010 Unaudited Unaudited Audited Revenue 33 324 34 404 62 718 Net investment 6 359 (1 049) 1 076 profit/(losses) Share of profits of 30 947 19 025 44 418 associates Interest income 648 734 1 443 Operating income 71 278 53 114 109 655 Operating costs (1 909) (2 280) (3 869) Amortisation (8 157) (3 303) (6 606) Impairment of intangible - - (12 659) asset Impairment of available-for-- - (7 368) sale investment Interest expense - - (21) Profit before tax 61 212 47 531 79 132 Tax (169) (193) 1 403 Profit for the period 61 043 47 338 80 535
Other comprehensive income Changes in fair value of 56 283 (54 288) 77 693 available-for-sale financial instruments, net of tax Reclassification adjustment - - 96 for impairment included in profit for the year Total comprehensive income 117 326 (6 950) 158 324 for the period Profit for the period attributable to: Minority shareholder 5 405 4 439 3 267 Ordinary shareholders 55 638 42 899 77 268 61 043 47 338 80 535 Total comprehensive income for the period attributable to: Minority shareholder 10 812 628 7 812 Ordinary shareholders 106 514 (7 578) 150 512 117 326 (6 950) 158 324 Earnings per share (cents) 15.4 11.9 21.4 Headline earnings per share 14.0 11.9 24.5 (cents) CONDENSED GROUP STATEMENTS OF FINANCIAL POSITION 31 December 30 June 2010 2009 2010 R`000 Unaudited Unaudited Audited ASSETS Non current assets Investment in associates 87 617 107 729 93 555 Available-for-sale 848 314 657 230 784 892 investments 935 931 764 959 878 447 Current assets Accounts receivable 21 23 556 Tax 261 2 673 196 Cash and cash equivalents 30 121 23 733 26 317 30 403 26 429 27 069 Total assets 966 334 791 388 905 516 EQUITY AND LIABILITIES Capital and reserves Ordinary shareholders` 893 977 723 480 838 136 equity Minority interest 60 764 54 841 56 432 954 741 778 321 894 568 Non current liabilities Tax - 12 315 10 510 - 12 315 10 510 Current liabilities Accounts payable and 1 083 752 438 accruals Tax 10 510 - - 11 593 752 438 Total liabilities 11 593 13 067 10 948 Total equity and 966 334 791 388 905 516 liabilities CONDENSED GROUP STATEMENTS OF CASH FLOW Six months ended Year ended 31 December 30 June
2010 2009 2010 R`000 Unaudited Unaudited Audited Cash flows from operating 5 397 (3 918) (3 037) activities Cash flows from investing 55 560 50 469 101 216 activities Cash flows from financing (57 153) (51 685) (100 729) activities Net cash flows 3 804 (5 134) (2 550) CONDENSED GROUP STATEMENTS OF CHANGES IN EQUITY R`000 Ordinary Minority Total shareholders` interest
equity Unaudited For the 6 months ended 31 December 2010 Balances at 30 June 838 136 56 432 894 568 2010 Profit for the year 55 638 5 405 61 043 Other comprehensive income 50 876 5 407 56 283 Dividends paid (50 673) (6 480) (57 153) Balances at 893 977 60 764 954 741 31 December 2010 Unaudited For the 6 months ended 31 December 2009 Balances at 780 487 56 465 836 952 30 June 2009 Profit for the year 42 899 4 439 47 338 Other comprehensive income (50 477) (3 811) (54 288) Disposal of treasury shares 1 196 - 1 196 Dividends paid (50 625) (2 252) (52 877) Balances at 723 480 54 841 778 321 31 December 2009 Audited For the year ended 30 June 2010 Balances at 780 487 56 465 836 952 30 June 2009 Profit for the year 77 268 3 267 80 535 Other comprehensive income 73 244 4 545 77 789 Disposal of treasury shares 1 196 - 1 196 Dividends paid (94 059) (7 845) (101 904) Balances at 30 June 838 136 56 432 894 568 2010 HEADLINE EARNINGS PER SHARE Six months ended Year ended 31 December 30 June
2010 2009 2010 R`000 Unaudited Unaudited Audited Headline earnings per share 14.0 11.9 24.5 (cents) Weighted average number of 361.9 361.7 361.8 shares (million) Reconciliation of headline earnings (R`000) Earnings attributable to 55 638 42 899 77 268 ordinary shareholders Adjusted for: 'Realised investment (6 500) - (2 172) profits 'Impairment of casino - - 12 659 licence 'Impairment of Worcester - - 7 368 'Tax on above items - - (1 788) 'Minority interest in the 1 508 - (4 646) above items Headline earnings 50 646 42 899 88 689 NET ASSET VALUE 31 December 30 June 31 December R`000 2010 2010 2009 Afrisun Leisure 1 227 908 1 161 081 1 009 875 Other net liabilities (5 128) (5 732) (4 133) Cash 29 745 24 721 15 453 Borrowings - - - Net asset value 1 252 525 1 180 070 1 021 195 Issued shares net of 361.9 361.9 361.9 treasury shares (million) Net asset value per share 346 326 282 (cents) Note All the investments held by Afrisun Leisure have been valued using the Discounted Cash Flow (DCF) valuation method applying a discount rate of 11.46% (30 June 2010:12.11%) at 31 December 2010, to the directors` current estimated future cash flows. A minority discount of 15% has been applied to the valuation of the gaming company investments. ACCOUNTING POLICIES The condensed consolidated financial information for the six months ended 31 December 2010 has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRS), the presentation and disclosure requirements of IAS 34 - Interim Financial Reporting and AC 500 standards issued by the Accounting Practices Board. The accounting policies applied are consistent with those adopted in the financial statements for the year ended 30 June 2010. REVIEW OF RESULTS Revenue of R33.3 million, comprising dividends received was R1 million lower than last year as a result of lower dividends received from Afrisun KZN offset in part by higher dividends from SunWest. The net investment profit of R6.4 million (2009: R1 million loss) relates mainly to a R6.5 million profit realised on the sale of a 14.3% interest in Zonwabise pursuant to a buyback by Zonwabise resulting from a commitment made for Emfuleni`s licence bid. The comparative period included an impairment of the investment made to the Biotech Venture Fund of R1 million (2010: R0.1 million). The share of profits of associates includes the group`s share of income from Afrisun Gauteng, Zonwabise and the management companies. The share of profits increased mainly due to the payment of a cancellation fee on the early termination of the Emfuleni Manco management contract which resulted in higher profits in National Manco and Zonwabise who each own 50% of Emfuleni Manco. Headline earnings per share increased by 18% due to the increase in the share of profits from associates. The board has declared an interim dividend of 13 cents (2009:12 cents) per share. NON CURRENT ASSETS The group contributed R7.1 million for its share of a R70 million capitalisation of Golden Valley. Afrisun Leisure`s interest in Zonwabise reduced to 26.7% following the sale of shares in Zonwabise back to Zonwabise. The value of Afrisun Leisure has increased by 5.8% from R1 161 million at 30 June 2010 to R1 228 million due mainly to a lower discount rate used in the valuations from 12.11% at 30 June 2010 to 11.46%. SUNWEST EXCLUSIVITY GrandWest`s initial 10-year casino exclusivity in the Cape Metropole expired during December 2010. The Provincial Government of the Western Cape is still considering whether to permit one of the other casino licence holders in the Western Cape to relocate to the Cape Metropole and has engaged interested stakeholders before taking a final decision. Sufficient information to assess the potential impacts on GrandWest`s revenue and profitability remains unavailable. OUTLOOK Whilst gaming revenues have stabilised at the group`s major investments, no significant improvements are anticipated for the remainder of the year. DIVIDEND Notice is hereby given that an interim dividend of 13 cents per share for the year ended 31 December 2010 (2009: 12 cents) has been declared, payable to shareholders recorded in the register of the company at the close of business on the record date appearing below. The salient dates applicable to the final dividend are as follows: 2011 Last day to trade cum Thursday, 17 March interim dividend First day to trade ex Friday, 18 March interim dividend Record date Friday, 25 March Payment date Monday, 28 March No share certificates may be dematerialised or rematerialised between Friday, 18 March and Friday, 25 March 2011, both days inclusive. Dividend cheques will be posted and electronic payments made, where applicable, to certificated shareholders on the payment date. Dematerialised shareholders will have their accounts with their Central Securities Depository Participant or broker credited on the payment date. For and on behalf of the board MV Moosa RP Becker Chairman Financial director 2 March 2011 REGISTERED OFFICE 27 Fredman Drive, Sandown, Sandton, 2031 REGISTRAR Computershare Investor Services (Pty) Ltd, 70 Marshall Street, Johannesburg, 2001 SPONSOR Investec Bank Limited DIRECTORS MV Moosa (Chairman), RP Becker (Financial director), DC Coutts-Trotter, MJ Leeming, MMT Ramano, Y Waja SECRETARIES Sun International Corporate Services (Pty) Limited Date: 03/03/2011 09:44:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. 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