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SBL - Sable Holdings Limited - Unaudited interim group results for six months
ended 31 December 2010
SABLE HOLDINGS LIMITED
("Sable" or the "company" or "the group")
(Registration No. 1968/010636/06) Share code: SBL ISIN code: ZAE000006383
(Incorporated in the Republic of South Africa)
Unaudited interim group results for six months ended 31 December 2010
Consolidated condensed statement of comprehensive income
(Unaudited) (Audited)
Six months Year
ended ended
31 December 30 June
(R`000) 2010 2009 2010
Revenue 16,648 16,652 38,151
Turnover 16,089 16,652 36,746
Profit from operations 5,188 7,709 17,750
Profit on disposal of investments and
investment property 7 2,265 2,395
Profit on disposal of investments 7 2,340 2,145
(Loss)/profit on disposal of investment property - (75) 250
Fair value gains on investments and
investment property 749 236 1,216
Fair value gains on investment 249 236 161
Net surplus on revaluaton of
investment property 500 - 1,055
Profit before finance costs and taxation 5,944 10,210 21,361
Income from investments 24 22 42
Finance income 535 764 1,405
Finance costs (6,398) (8,645) (17,969)
Share of profit from associates and
joint ventures 2,336 (1,973) 2,327
Profit before taxation 2,441 378 7,166
Taxation (622) 1,145 1,268
Net profit for the period 1,819 1,523 8,434
Other comprehensive income - - -
Total comprehensive income for the period 1,819 1,523 8,434
Total profit and comprehensive income attributable to:
Equity shareholders of Sable Holdings
Limited 1,825 1,527 8,444
Non-controlling interest (6) (4) (10)
Earnings and diluted earnings per ordinary
share (cents) 19.9 16.6 92.0
Consolidated condensed statement of financial position
(Unaudited) (Audited)
Six months Year
ended ended
31 December 30 June
(R`000) 2010 2009 2010
Assets
Non-current assets 520,441 541,059 517,669
Investment property 272,545 305,807 274,858
Investments 238,210 226,242 233,042
Deferred taxation 3,997 4,738 3,869
Other non-current assets 5,689 4,272 5,900
Current assets 4,240 9,293 3,841
Cash and cash equivalents 728 6,913 860
Other current assets 3,512 2,380 2,981
Non-current asset held for sale 4,500 - 36,000
Total assets 529,181 550,352 557,510
Equity and liabilities
Total equity 381,785 372,616 379,966
Non-current liabilities 125,386 162,441 155,431
Interest-bearing borrowings 95,054 129,202 123,351
Deferred taxation 30,332 33,239 32,080
Current liabilities 22,010 15,295 22,113
Total equity and liabilities 529,181 550,352 557,510
Weighted average number of ordinary shares
in issue net of treasury shares (`000) 9,175 9,175 9,175
Net asset value and net tangible asset
value per ordinary share (cents) 4,161 4,061 4,141
Consolidated condensed statement of cash flows
(Unaudited) (Audited)
Six months Year
ended ended
31 December 30 June
(R`000) 2010 2009 2010
Cash (outflow)/inflow from operating
activities (156) 1,854 3,226
Cash inflow from investing activities 32,154 48,510 21,097
Cash outflow from financing activities (31,009) (32,896) (9,222)
Net increase in cash and cash equivalents 989 17,468 15,101
Cash and cash equivalents at the beginning
of the period (1,210) (16,311) (16,311)
Cash and cash equivalents at the end
of the period (221) 1,157 (1,210)
Cash and cash equivalents at the end of
the period consist of:
Cash and cash equivalents (221) 6,913 (1,210)
Loans on demand - (5,756) -
(221) 1,157 (1,210)
Consolidated condensed statement of changes in equity
Non- Non-
Share capital distributable Retained controlling Total
(R`000) and premium reserves earnings interests equity
Balance at 30 June 2009
51,425 105,978 213,657 79 371,139
Total comprehensive income for the year
- - 8,444 (10) 8,434
Share of profit from associates and joint ventures
- 2,327 (2,327) - -
Realisation of non-distributable reserve
- 393 - - 393
Balance at 30 June 2010
51,425 108,698 219,774 69 379,966
Total comprehensive income for the period
- - 1,825 (6) 1,819
Share of profit from associates and joint ventures
- 2,336 (2,336) - -
Balance at 31 December 2010
51,425 111,034 219,263 63 381,785
Consolidated condensed segmental analysis
(Unaudited) (Audited)
Six months Year
ended ended
31 December 30 June
(R`000) 2010 2009 2010
Segmental revenue 16,648 16,652 38,151
Investment property 15,569 17,027 35,459
Commercial 3,138 3,253 6,614
Industrial 7,039 7,408 14,944
Retail 4,817 5,833 12,782
Residential 575 533 1,119
Corporate and inter-segment charges 1,079 (375) 2,692
Profit before taxation 2,441 378 7,166
Investment property
Commercial 1,672 1,854 5,425
Industrial 2,158 2,551 4,872
Retail 804 71 247
Residential 71 66 169
Corporate and inter-segment charges (2,264) (4,164) (3,547)
Investment property 277,045 305,807 310,858
Commercial 66,451 64,112 65,951
Industrial 95,774 126,064 130,087
Retail 101,620 102,431 101,620
Residential 13,200 13,200 13,200
Reconciliation of net profit for the period to headline earnings
(Unaudited) (Audited)
Six months Year
ended ended
31 December 30 June
(R`000) 2010 2009 2010
Net profit attributable to owners of
Sable Holdings Limited 1,825 1,527 8,444
Adjustments:
Profit on disposal of investment in subsidiary
and investment property - (2,501) (2,354)
Fair value gains on investment property (500) - (1,077)
Tax effects of adjustments 140 351 634
Adjustments through associates and joint ventures:
Profit on disposal of investment property (315) - (414)
Fair value gains on investment property - - (821)
Tax effects of adjustments 44 - (47)
Headline earnings/(loss) for the period 1,194 (623) 4,365
Headline earnings/(loss) per ordinary share
(cents) 13.0 (6.8) 47.6
Comments
Basis of preparation and accounting policies
The unaudited consolidated condensed financial results have been prepared in
accordance with the Framework concepts and the measurement and recognition
requirements of the International Financial Reporting Standards ("IFRS") and
containing information required by IAS 34 "Interim Financial Reporting" and AC
500 Standards as issued by the Accounting Practices Board, the JSE Limited
Listings Requirements and the manner required by the Companies Act. The
accounting policies and methods of computation are consistent with those used in
the annual financial statements for the financial year ended 30 June 2010. The
consolidated condensed statement of financial position as at 31 December 2010
and the related consolidated condensed statement of comprehensive income,
consolidated condensed statement of changes in equity and cash flow for the six
months ended have not been reviewed or reported on by the group`s auditors.
Directors` commentary on results
Unaudited comparative analysis between 31 December 2010 and 31 December 2009
The group reported a net profit of R1.8 million (2009: R1.5 million) for the
period ended 31 December 2010. Earnings per share increased by 19.9% from 16.6
cents to 19.9 cents, with no dilution in either period, whilst headline earnings
per share increased by 291.2% from a headline loss of 6.8 cents to a headline
earnings of 13.0 cents.
Consolidated condensed statement of comprehensive income
Revenue
The revenue for the period has remained flat primarily due to the sale of six
industrial investment properties located in Kya Sand, Johannesburg, during
October 2010. Total gross lettable area has decreased from 59,740m2 to 46,238m2
subsequent to the sale. The quality of Sable`s property portfolio has ensured
that vacancies have been kept to a minimum at 2.0% (2009: 1.7%) of total gross
lettable area.
Profit on disposal of investments and investment property decreased from R2.3
million to R0.1 million.
Fair value gains on investments and investment property increased from R0.2
million to R0.8 million. Investment property was revalued by R0.5 million which
relates to a commercial investment property which has been sold and has been
disclosed as a non-current asset held for sale. Investments in listed shares
increased by R0.3 million due to a strong recovery of domestic shares on the
JSE.
Finance costs, net of investment and finance income, decreased from R7.9 million
to R5.8 million. The decrease in finance costs was attributable to reduced
borrowings from the Kya Sand portfolio sales proceeds.
Share of profits from associates and joint ventures increased from a loss of
R2.0 million to a profit R2.3 million. Trading conditions remain testing in
respect of sales in residential, retirement, industrial and commercial
developments.
Consolidated condensed statement of financial position as at 31 December 2010
Investment property
Analysis of investment property
31 December 30 June
2010 Number of 2010 Number of
R`000 properties R`000 properties
Carrying value at the beginning
of the period 310,858 22 357,465 24
Additions 1,687 - 6,489 1
Disposals (36,000) (6) (54,151) (3)
Revaluations 500 - 1,055 -
Carrying value at the end
of the period 277,045* 18 310,858 22
These balances are inclusive of the non-current assets held for sale of R4.5
million* (30 June 2010: R36.0 million).
Investment property has reduced by a net R33.8 million primarily due to the sale
of six industrial investment properties located in Kya Sand, Johannesburg valued
at R36.0 million. During the period, Sable concluded a further sale of a
commercial office property located in Woodmead, Sandton, Johnnesburg, valued at
R4.5 million*. The investment property has been disclosed as a non-current
asset held for sale and the transfer of the property is expected in May 2011.
Investments
Investments comprising of investments in listed shares, investments and
investments in associates and joint ventures increased by a net R5.2 million.
Investments in listed shares increased from R 1.7 million to R2.0 million as a
result of fair value adjustments. Investments and Investments in associates and
joint ventures increased from R231.3 million to R236.2 million through net loan
funding of R2.6 million and share of profits from associates and joint ventures
of R2.3 million.
Interest-bearing borrowings and bank overdrafts
Interest-bearing borrowings have decreased from R138.4 million to R106.7 million
primarily due to the sale of the Kya Sand portfolio. The majority of the
proceeds from the R36.0 million sale was allocated to repay both short and long
term interest-bearing borrowings.
Prospects
Investments in associates and joint ventures
Sable, with its building partners, Abbeydale Building and Civils (Pty) Limited,
has completed a R68.0 million re-development of Hobart Grove Retail Shopping
Centre in Bryanston, Sandton. The expanded centre of 10 093mSquared gross
lettable area has opened on 24 March 2011 and boasts amongst other new tenants,
a Super Spar and Tops. The current area that is occupied and let exceeds 90%.
A new 10 year lease with Shoprite Checkers has been concluded at Noordheuwel
Shopping Centre, Krugersdorp. This lease replaces the existing Metcash Mega
Grocer lease with effect from 1 November 2010.
A minor refurbishment amounting to R3.6 million was spent at Cramerview Shopping
Centre, Bryanston. A large part of the centre was upgraded and modernised
including the placement of a new fruit, vegetable and butchery anchor tenant of
650mSquared. The resultant rental income has improved substantially which will
increase the property investment value in the next financial year.
Phase 2 comprising 17 independent-living sectional title clusters valued at
R25.0 million and phase 1 comprising 20 assisted-living sectional title
apartments valued at R12.0 million in the existing retirement park in Hazeldean,
Pretoria East, were launched by Sable Homes in the early part of January 2011.
In addition, phase 2 comprising 18 sectional title cluster apartments valued at
R16.7 million was launched in the Oukraal estate, Hazeldean, Pretoria East. The
various launches have been received with reasonable success by the purchasing
market.
Heron Banks, a golfing and river estate, located on the banks of the Vaal River,
Vanderbijlpark, comprising phase 1 of 101 stands with building packages
available as well as 56 sectional-title apartments, is due to be launched by
Sable Homes, in association with Nedbank, in May 2011.
Lower bank interest rates and well priced residential housing stock has resulted
in stronger demand from property buyers and investors, resulting in the first
quarter of 2011 reflecting encouraging deal flow.
Corporate activity - ALTx board
The directors of Sable refer to the announcement on 10 March 2011 in which
shareholders were advised that the JSE has approved an application for the
transfer of Sable`s listing from the JSE Main Board to the ALTx Sector with
effect from the commencement of business on Monday, 14 March 2011.
Related party transactions
Management fees were charged to associates and joint ventures during the period.
These amounts were market related and at arm`s length.
Dividends
The board of directors has resolved not to declare a dividend for the period
ended 31 December 2010. All cash reserves have been earmarked in funding
development and investment property opportunities within the group.
Events after reporting period end
Sable`s board of directors are not aware of any reportable material events that
have occurred between the end of the financial period and the date of this
report.
Going concern
The financial statements have been prepared on the going concern basis as the
directors have every reason to believe that the company has adequate resources
in place to continue in operation for the foreseeable future.
For and behalf of the board
PH Nash (Chairman)
GBJ Bowes (Managing director)
29 March 2011
Directors: PH Nash (Chairman)*, GBJ Bowes (Managing), KA Haswell (Financial), IA
Chambers*, DJ Pennington* (*non-executive)
Registered office: Sable Place, Fairway Office Park, 52 Grosvenor Road,
Bryanston 2021. PO Box 786390, Sandton 2146.
Transfer secretaries: Computershare Investor Services (Proprietary) Limited, 70
Marshall Street, Johannesburg, 2001. PO Box 61051, Marshalltown 2107.
Designated advisor: Sasfin Capital - a division of Sasfin Bank Limited
Date: 29/03/2011 15:28:01 Supplied by www.sharenet.co.za
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