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KDV - KayDav Group Limited - Unaudited Interim Results for the six months ended

Release Date: 30/08/2011 17:49
Code(s): KDV
Wrap Text

KDV - KayDav Group Limited - Unaudited Interim Results for the six months ended 30 June 2011 KayDav Group Limited Incorporated in the Republic of South Africa Registration number 2006/038698/06 JSE code: KDV ISIN: ZAE000108940 UNAUDITED INTERIM RESULTS for the six months ended 30 June 2011 Headline earnings per share 3.2 cents (up 100%) Earnings from continuing operations R5.8 million (up 4%) Consolidated statement of comprehensive income Unaudited Unaudited Audited six months six months year ended ended ended 30 June 30 June 31 December
2011 2010 2010 R R R Continuing operations Revenue 221 401 673 214 352 457 460 837 937 Cost of sales (152 806 566) (149 121 362) (328 430 134) Gross profit 68 595 107 65 231 095 132 407 803 Other income 208 389 454 423 1 227 431 Operating expenses (59 529 988) (56 674 526) (116 709 971) Operating profit 9 273 508 9 010 992 16 925 263 Investment income 109 748 212 682 465 486 Finance costs (1 331 571) (1 535 122) (2 737 521) Profit before taxation 8 051 685 7 688 552 14 653 228 Taxation (2 247 196) (2 100 727) (20 470) Profit for the period 5 804 489 5 587 825 14 632 758 Other comprehensive income - - - Total comprehensive income attributable to equity holders of the parent from continuing operations 5 804 489 5 587 825 14 632 758 Discontinued operation Loss for the period from discontinued operation before loss on disposal - (2 149 350) (6 921 631) Loss on disposal of discontinued operation - - (1 125 326) Loss for the period - (2 149 350) (8 046 957) Other comprehensive income - - - Total comprehensive loss attributable to equity holders of the parent from discontinued operation - (2 149 350) (8 046 957) Total comprehensive income attributable to equity holders of the parent from continuing and discontinued operations 5 804 489 3 438 475 6 585 801 Reconciliation between earnings and headline earnings Total comprehensive income 5 804 489 3 438 475 6 585 801 Profit on disposal of plant and equipment (19 869) (2 089) (4 186) Taxation effect of disposal of plant and equipment 5 563 585 1 172 Loss on sale of business - - 1 125 326 Headline earnings attributable to equity holders 5 790 183 3 436 971 7 708 113 Weighted average number of shares in issue 183 566 511 213 504 505 198 961 975 Basic and diluted earnings per share (cents) 3.2 1.6 3.3 Headline earnings per share (cents) 3.2 1.6 3.9 Consolidated statement of financial position Unaudited Unaudited Audited 30 June 30 June 31 December 2011 2010 2010 R R R
ASSETS Non-current assets 51 636 500 51 643 882 51 525 170 Plant and equipment 30 964 026 34 793 222 31 349 411 Goodwill 14 302 804 14 302 804 14 302 804 Deferred taxation 6 369 670 2 547 856 5 872 955 Current assets 158 274 153 162 073 079 151 879 798 Inventories 65 148 524 68 490 264 61 237 708 Trade and other receivables 75 068 012 82 366 693 66 122 323 Cash and cash equivalents 16 060 542 9 531 600 22 747 360 Taxation 1 997 075 1 684 522 1 772 407 Total assets 209 910 653 213 716 961 203 404 968 EQUITY AND LIABILITES Capital and reserves 111 160 871 112 837 302 115 650 549 Share capital 184 184 184 Share premium 184 556 185 195 184 431 194 850 351 Accumulated loss (73 395 498) (82 347 313) (79 199 986) Non-current liabilities 13 257 950 18 011 536 15 605 553 Instalment sale liabilities 3 474 920 5 122 402 4 248 936 Interest-bearing liability 9 783 030 12 828 607 11 242 494 Deferred taxation - 60 527 114 123 Current liabilities 85 491 832 82 868 123 72 148 866 Trade and other payables 58 615 158 54 388 910 56 057 241 Short-term portion of instalment sale liabilities 3 487 803 2 790 474 3 215 677 Short-term portion of interest-bearing liability 2 841 891 2 499 867 2 707 832 Bank overdraft 16 585 060 19 012 096 8 034 017 Provisions 3 961 920 4 176 776 2 134 099 Total equity and liabilites 209 910 653 213 716 961 203 404 968 Shares in issue at period end 183 087 373 184 586 273 183 637 373 Net asset value per share (cents) 60.7 61.1 63.0 Tangible net asset value per share (cents) 52.9 53.4 55.2 Condensed statement of changes in equity Unaudited Unaudited Audited six months six months year
ended ended ended 30 June 30 June 31 December 2011 2010 2010 R R R
Balance at the beginning of the period 115 650 549 125 842 799 125 842 799 Distribution to shareholders (10 100 061) - - Share repurchases (194 106) (16 443 972) (16 778 051) Total comprehensive income for the period 5 804 489 3 438 475 6 585 801 Balance at the end of the period 111 160 871 112 837 302 115 650 549 Condensed consolidated statement of cash flows Unaudited Unaudited Audited six months six months year ended ended ended 30 June 30 June 31 December
2011 2010 2010 R R R Cash flows from operating activities (1 386 211) (8 011 374) 11 750 263 Cash flows from investing activities (1 730 191) (1 496 652) 5 096 041 Cash flows from financing activities (12 121 459) (1 773 908) (3 934 399) Net (decrease)/increase in cash and cash equivalents (15 237 861) (11 281 934) 12 911 905 Net cash and cash equivalents at the beginning of the period 14 713 343 1 801 438 1 801 438 Net cash and cash equivalents at the end of the period (524 518) (9 480 496) 14 713 343 Segmental analysis Unaudited Unaudited Audited
six months six months year ended ended ended 30 June 30 June 31 December 2011 2010 2010
R R R Segmental revenue Board distribution 215 347 802 208 269 898 449 403 208 Manufacturing 17 067 421 30 648 152 62 870 866 Internal revenue (11 013 550) (8 745 907) (21 622 472) Net revenue 221 401 673 230 172 143 490 651 602 Discontinued operation - manufacturing - (15 819 686) (29 813 665) Revenue from continuing operations 221 401 673 214 352 457 460 837 937 Segmental results Board distribution 8 082 537 9 243 774 16 660 984 Manufacturing 12 819 (3 223 872) (8 394 199) Other 1 178 152 853 875 1 758 273 Operating profit before interest 9 273 508 6 873 777 10 025 058 Discontinued operation - manufacturing - 2 137 215 6 90 0 205 Loss for the period from discontinued operation - 2 149 350 6 921 631 Net finance charges from discontinued operation - (12 135) (21 426) Operating profit before interest from continuing operations 9 273 508 9 010 992 16 925 263 Commentary Introduction KayDav Group Limited ("KayDav" or "the Group") specialises in the distribution and adding of value to wood-based panels, which are products manufactured through the compression of wood waste into a solid panel. Wood-based panels are used for a variety of purposes in the construction, furniture manufacturing and shop fitting industries. Financial results Revenue from continuing operations for the first six months of the 2011 financial year was 3.3% higher compared to the same period in 2010. The board distribution segment experienced revenue growth of 3.4%. Excluding the operation discontinued during the 2010 financial year, the manufacturing segment experienced revenue growth of 15% (including internal revenue). The board distribution segment contributed R8.1 million to operating profit compared to R9.2 million for the first six months of 2010. The manufacturing segment contributed R0.01 million to operating profit compared with a loss of R3.2 million for the previous corresponding period. Total comprehensive income increased by 69% to R5.8 million from the R3.4 million recorded for the previous corresponding period, while total comprehensive income from continuing operations increased by 4% to R5.8 million. During the reporting period KayDav repurchased 550 000 of its own shares at a cost of 35 cents per share, resulting in 183 087 373 KayDav shares in issue at 30 June 2011. Save for structural changes in our industry, for example industry wide gross margin changes, the second half of the financial year normally generates the greater contribution to annual operating profit. Basic and diluted earnings per share as well as headline earnings per share of 3.2 cents are 100% higher than the 1.6 cents per share for the previous corresponding period. These results are considered satisfactory having regard to the tough trading conditions in the industry. Prospects Activity levels in our industry are determined by consumer demand which is impacted by consumers` personal debt levels, employment and willingness of financial institutions to extend credit. Management anticipates that the increase in lending by financial institutions as well as increased spending power of consumers will increase activity levels in our industry. Whilst this improvement is anticipated, the potential negative macro-economic effect of recent global events and the direction of future interest rate movements on our industry make the timing of any improvement uncertain. Management is focusing on increasing market share and effective cost and working capital control. Distributions to shareholders A distribution to shareholders by way of a reduction of share premium of 5.5 cents per share was made on 30 May 2011. Subsequent events No material change has taken place in the affairs of the Group between the end of the financial period and the date of this report, that requires adjustment or disclosure. Basis of preparation The interim financial statements have been prepared in accordance with International Financial Reporting Standards, AC 500 standards, the requirements of IAS 34 (Interim Financial Reporting) and in compliance with the JSE Listings Requirements and the Companies Act, 2008 of South Africa. The accounting policies applied in preparing these interim financial statements are consistent with those presented in the annual financial statements for the year ended 31 December 2010 and have not been audited or reviewed by the KayDav auditors. Appreciation The board extends its appreciation to our management and staff for their efforts during this reporting period. We also thank our customers and suppliers for their continued support. On behalf of the board I H Stern G F Davidson Chairman Chief Executive Officer Cape Town 26 August 2011 Corporate information Executive directors: GF Davidson (CEO), M Slier (CFO) Non-executive directors: IH Stern (Chairman), J Hertz Registration number: 2006/038698/06 Registered address: 105 Bamboesvlei Road, Ottery, 7800 Postal address: PO Box 272, Ottery, 7808 Telephone: 021 704 7060 Facsimile: 086 519 2014 Company secretary: Probity Business Services (Pty) Limited Transfer secretaries: Link Market Services South Africa (Pty) Limited Sponsor: Java Capital 30 August 2011 Date: 30/08/2011 17:49:54 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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