Wrap Text
SBV/SVN - Sabvest Limited - Unaudited interim results for the six months ended
30 June 2011 and cash dividend declaration
SABVEST LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1987/003753/06
ISIN: ZAE000006417 - ordinary shares
ISIN: ZAE000012043 - "N" ordinary shares
Share code: SBV - ordinary shares
Share code: SVN - "N" ordinary shares
("Sabvest" or "the group")
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2011 AND CASH
DIVIDEND DECLARATION
CONSOLIDATED CONDENSED STATEMENT OF FINANCIAL POSITION
at 30 June 2011
Unaudited Unaudited Audited
30 June 30 June 31 Dec
2011 2010 2010
R`000 R`000 R`000
Non-current assets 487 347 408 169 453 800
Property, plant and equipment 680 905 745
Deferred tax asset - 740 555
Share trust receivables 3 946 4 040 3 761
Investment holdings 482 721 402 484 448 739
Associates 351 028 312 730 329 373
Long-term investments 131 693 89 754 119 366
Current assets 22 270 32 339 41 686
Finance advances and receivables 4 619 30 392 16 532
Other financial instruments 5 985 - 5 899
Short-term investments 9 081 1 850 16 021
Cash balances 2 585 97 3 234
Total assets 509 617 440 508 495 486
Ordinary shareholders` equity 440 695 389 599 427 098
Non-current liabilities 47 306 40 488 55 491
Interest-bearing debt 40 135 35 000 48 124
Deferred tax liability 7 171 5 488 7 367
Current liabilities 21 616 10 421 12 897
Interest-bearing debt 15 519 5 250 5 133
Accounts payable 6 097 5 171 7 764
Total equity and liabilities 509 617 440 508 495 486
Shareholders` equity with
investments at
intrinsic value (R`000) 591 941 515 222 569 679
Net asset value per
share - cents 954 850 922
Net asset value per share with
investments in associates at
directors` valuation
(intrinsic value) - cents 1 263 1 124 1 230
Number of shares in issue
less held in share trust/
treasury - 000`s 46 176 45 820 46 320
CONSOLIDATED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 June 2011
Unaudited Unaudited Audited
6 months 6 months 6 months
ended ended ended
30 June 30 June 31 Dec
2011 2010 2010
R`000 R`000 R`000
Gross income from operations and
Investments 32 724 31 170 100 031
Dividends received 12 817 181 17 208
Interest received 616 1 339 2 884
Income on financial instruments
and shares 2 926 93 (1 166)
Fees and sundry income 1 148 2 160 5 125
Fair value adjustment to
investments (3 975) 2 301 21 585
Equity accounted retained
income of associates 19 192 25 096 54 395
Share of net income of
associates 31 539 25 096 68 752
Less: Dividends received (12 347) - (14 357)
Impairments (81) (82) (144)
Interest paid 2 357 1 514 3 892
Net income before expenses and
exceptional items 30 448 29 738 96 283
Less: Expenditure 11 285 9 230 23 103
Operating costs 11 211 9 067 22 783
Depreciation 74 163 320
Exceptional gains (280) (76) (325)
Net income before taxation 19 443 20 584 73 505
Taxation - deferred 359 786 2 849
Net income for the period
attributable to equity
shareholders 19 084 19 798 70 656
Translation of foreign
subsidiary/associates 573 (385) (1 515)
Total comprehensive income
attributable to equity
shareholders 19 657 19 413 69 141
Earnings per share - cents 41,3 43,2 154,0
Dividends per share (proposed
after interim/year-end) - cents 4,0 4,0 17,0
Weighted average number of shares
in issue - 000`s 46 236 45 864 45 869
Headline earnings per
share - cents *1 40,7 42,7 153,0
Reconciliation of headline earnings
Net income for the period 19 084 19 798 70 656
Exceptional gains - group (280) - (236)
Losses/costs arising from former
finance operations - (76) (89)
Profit on sale of property, plant
and equipment - (155) (167)
Headline earnings for the period 18 804 19 567 70 164
*1 There are no diluting instruments.
CONSOLIDATED CONDENSED STATEMENT OF CASH FLOWS
for the six months ended 30 June 2011
Unaudited Unaudited Audited
6 months 6 months 6 months
ended ended ended
30 June 30 June 31 Dec
2011 2010 2010
R`000 R`000 R`000
Cash generated by/(utilised in)
operating activities 644 (6 645) 552
Cash generated by/(utilised in)
investing activities 3 650 7 764 (45 054)
Cash effects of financing
activities (9 309) (365) 50 359
Cash utilised for the payment
of dividends (6 020) (5 090) (6 939)
Change in cash and cash
equivalents (11 035) (4 336) (1 082)
Cash balances, less
interest-bearing debt,
at beginning of period (1 899) (817) (817)
Cash balances, less
interest-bearing debt,
at end of period (12 934) (5 153) (1 899)
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2011
Non-
distri- Accu-
Share Share butable mulated
capital premium reserve profit Total
R`000 R`000 R`000 R`000 R`000
Balance as at
1 January 2010 867 48 874 241 789 87 541 379 071
Total comprehensive
income for the
period - - (1 515) 70 656 69 141
Loss in share
trust - written
back - - 808 - 808
Share-based payment
charge - written
back - - (643) - (643)
Attributable income
of associates - - 54 395 (54 395) -
Movement in translation
and other reserves
of associates - - (16 081) - (16 081)
Shares held in treasury (3) (362) - - (365)
Shares held in share
trust - written back - 1 855 - - 1 855
Shares held in share trust - (2 349) - - (2 349)
Shares of "N" ordinary
shares - 2 600 - - 2 600
Dividends paid - - - (6 939) (6 939)
Balance as at
31 December 2010 864 50 618 278 753 96 863 427 098
Total comprehensive
income for the period - - 573 19 084 19 657
Loss in share trust -
written back - - 12 - 12
Attributable income of
associates - - 19 472 (19 472) -
Movement in translation
and other reserves
of associates - - 1 247 - 1 247
Shares held in treasury (7) (1 225) - - (1 232)
Shares held in treasury -
written back 3 362 - - 365
Shares held in share trust (3) (2 778) - - (2 781)
Shares held in share
trust - written back - 2 349 - - 2 349
Dividends paid - - - (6 020) (6 020)
Balance as at
30 June 2011 857 49 326 300 057 90 455 440 695
Contingent liabilities
1. The group has rights and obligations in terms of shareholder
or purchase and sale agreements relating to present or former
investments.
2. A group company has lease agreements for the premises that it
occupies. The amount due is as follows:
Year 1: R1m
INVESTMENT PORTFOLIO
at 30 June 2011
Economic Carrying Directors`
Number interest value value
of shares % R`000 R`000
Investments in
industrial
associates
Unlisted
Flowmax Holdings
Limited (BVI/UK) 40,0
SA Bias Industries
(Pty) Limited 57,3 *
Set Point Group
(Pty) Limited 49,8
Sunspray Food
Ingredients
(Pty) Limited 47,1
351 028 556 000
*Voting interest 48,5%.
Long-term investments
Unlisted
Korbitec Holdings
(Pty) Limited * 8,5
Korbicom (Pty) Limited 17,0
Transaction Capital
(Pty) Limited 1 000 000 - 21 198 21 198
*A Naspers subsidiary.
Listed
Brait SA 1 500 000 24 810
Datatec Limited 1 000 000 38 560
Metrofile Holdings
Limited 20 400 000 5,0 41 820
Net1 UEPS
Technologies Inc 100 000 5 305
110 495 110 495
Total long-term
investments
and associates 482 721 687 783
Short-term investments
Listed
Foreign 6 871
RSA 2 210
9 081 9 081
Total investment
holdings 491 802 696 874
Note: The group has shares and JJPIK loans in Primedia Holdings 1 Limited which
are currently fully impaired.
COMMENTARY
PROFILE
Sabvest is an investment group which has been listed since 1988. Its ordinary
and "N" ordinary shares are quoted in the Financials - Equity Investment
Instruments sector of the JSE Limited.
Sabvest has significant or joint controlling interests in four unlisted
industrial groups which are accounted for as associates, and a long-term
portfolio of seven other investments which are accounted for on a fair value
basis. Four of these are JSE-listed.
In addition, Sabvest maintains finance advances and share and debt instrument
portfolios and undertakes other fee and profit earnings activities.
FINANCIAL RESULTS
Sabvest recorded satisfactory results for the six-month period.
The group`s four industrial associates performed in line with expectations.
Sunspray Food Ingredients and Flowmax UK achieved good increases in
profitability. SA Bias Industries and Set Point Group produced stable results in
line with budgets.
Headline earnings per share decreased by 5% to 40,7 cents per share largely due
to negative fair value adjustments arising from stock market prices and one off
costs of R1m.
Shareholders` funds with investments at intrinsic value net of notional CGT
increased to R583 m and intrinsic value per share increased by 13% year-on-year
to 1 263 cents.
A three year bank loan of R40m has been raised to refinance existing non-bank
loans and facilitate an increased investment in Brait. Gearing remains
conservative.
The interim dividend has been maintained at 4 cents per share.
PERFORMANCE OF INDUSTRIAL ASSOCIATES
As reported previously, the unaudited combined revenues of Sabvest`s four
unlisted industrial associates for the twelve months ended 31 December 2010 were
R1,3bn, EBITDA R222m and PBT R182m. Sabvest`s share of their after-tax income
increased by 28% to R69m.
For the six-month period, Sabvest`s share of their after-tax income increased by
26% to R31,5m compared with the previous six-month period.
It should be noted that earnings from associates are seasonally greater in the
second half of each financial year.
CHANGES IN INVESTMENT HOLDINGS
During the period Sabvest:
- Acquired an additional 0,9m shares in Brait SA, increasing its
holding to 1,5m shares.
- Made changes to its foreign investment portfolio through the
sale of its interests in Qualcomm and Check Point Software and
an increase in its interest in Google.
With regard to the group`s associates:
- Flowmax UK acquired DEA Engineering in the USA and is also in
the process of concluding and integrating a material
acquisition in the UK;
- Set Point Group continues to grow organically through various
initiatives including the establishment of a new water
laboratory which has received 16 quality accreditations, new
operating units in the Wearcheck Oil Analysis Division in
Southern Africa, Dubai and India and a material increase in the
scope of the international activities of African Mineral
Standards.
DIVIDEND POLICY
Dividends are determined relative to Sabvest`s own expected recurring cash flows
from investments and services, and relative to current and expected capital
receipts that are not earmarked for new transactions.
It is the group`s policy to consider dividends twice annually. The dividends for
the interim period have been maintained at 4 cents per share.
RELATED PARTIES
Related party transactions exist between subsidiaries and the holding company,
fellow subsidiaries and associated companies, and comprise fees, dividends and
interest.
Transactions with directors relate to fees and monies lent to the group by
individuals and companies controlled by the directors.
ACCOUNTING POLICIES
The unaudited condensed interim financial statements have been prepared in terms
of International Financial Reporting Standards (IFRS) and comply with IAS 34 -
Interim Financial Reporting, the JSE Limited Listings Requirements, the
Companies Act of South Africa and have been supervised by the CFO, Mr R Pleaner.
The accounting policies used are consistent with those applied to the audited
financial statements for the year ended 31 December 2010, except for the
Adoption of Annual Improvements to IFRSs.
PROSPECTS
The group`s four industrial associates have sound growth prospects and are well
managed. The group is also comfortable with the prospects of its listed and
unlisted investment portfolios. The timing of the recognition of earnings growth
in the share prices of listed companies is obviously uncertain.
We anticipate a satisfactory year for the group.
For and on behalf of the Board
Haroon Habib Christopher Seabrooke Raymond Pleaner
Chairman Chief Executive CFO
28 July 2011
Sandton
CASH DIVIDEND DECLARATION
Notice is hereby given that an interim dividend of 4 cents (2010: 4 cents) per
ordinary share and "N" ordinary share for the six months ended 30 June 2011 has
been declared payable to shareholders in accordance with the undermentioned
timetable:
Last date to trade "CUM" dividend Friday, 12 August 2011
Trading "EX" dividend commences Monday, 15 August 2011
Record date Friday, 19 August 2011
Dividend payment date Monday, 22 August 2011
No dematerialisation or rematerialisation of share certificates will be allowed
during the period Monday, 15 August 2011 to Friday, 19 August 2011, both days
inclusive.
Registered address: 4 Commerce Square, 39 Rivonia Road, Sandhurst, Sandton 2196
Communications: Postal address: PO Box 78677, Sandton 2146, Republic of South
Africa
Communications: Telephone: (011) 268 2400
Fax: (011) 268 2422
e-mail: ho@sabvest.com
Transfer secretaries: Computershare Investor Services (Pty) Limited, 70 Marshall
Street, Marshalltown 2001
(PO Box 61051, Marshalltown 2107)
Directors: H Habib# (Chairman), P Coutts-Trotter (Deputy Chairman), CS
Seabrooke* (Chief Executive), CP Coutts-Trotter*, NSH Hughes#, DNM Mokhobo#, GE
Nel, R Pleaner*, BJT Shongwe# *Executive
#Independent
Sponsor: Rand Merchant Bank (A division of FirstRand Bank Limited)
www.sabvest.com
Date: 28/07/2011 12:35:02 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. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
Sharenet Sites 
