Wrap Text
IRA - Infrasors Holdings Limited - Unaudited interims for 6 months
ended 31 August 2011
Infrasors Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2007/002405/06)
Share Code on the JSE: IRA ISIN: ZAE 000101507
("Infrasors", "the Company" or "the Group")
UNAUDITED CONDENSED CONSOLIDATED RESULTS FOR THE SIX MONTHS ENDED 31
AUGUST 2011
Highlights
Revenue up 4,8%
Gross profit up 3,9%
Net profit up 5,1%
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited
six months ended six months ended
31 August 2011 31 August 2010
R000`s R000`s
Revenue 130 862 124 834
Gross profit 37 468 36 062
Net administration and other (15 458) (15 478)
operating expenses
Depreciation and amortisation (8 196) (5 957)
Net finance costs (2 592) (3 540)
Operating profit 11 222 11 087
Income tax expense (3 214) (3 468)
Net profit for the period 8 008 7 619
Total comprehensive income for the 8 008 7 619
period
Earnings per share (cents) - basic 4,4 4,2
and diluted
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Audited
as at as at
31 August 2011 28 February 2011
R000`s R000`s
Non-current assets 554 358 548 367
Property, plant and equipment 295 782 292 075
Investment property 87 495 87 483
Mineral rights 91 604 91 604
Investment in associate 7 000 7 000
Deferred tax assets 12 626 11 823
Held to maturity investment 46 949 46 949
Other financial assets 12 902 11 433
Current assets 87 017 74 279
Inventories 19 569 17 016
Trade and other receivables 43 033 39 251
Cash resources 24 415 17 044
Current tax receivable - 968
Total assets 641 375 622 646
Capital and reserves
Total equity 440 827 432 819
Issued share capital and premium 255 620 255 620
Revaluation reserve 6 150 6 150
Retained earnings 179 057 171 049
Non-current liabilities 141 113 138 237
Borrowings 64 053 63 798
Environmental rehabilitation 10 802 10 802
provision
Deferred tax liabilities 66 258 63 637
Current liabilities 59 435 51 590
Borrowings 23 891 22 724
Current tax payable 10 24
Trade and other payables 35 534 28 842
Total equity and liabilities 641 375 622 646
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Unaudited
six months ended six months ended
31 August 2011 31 August 2010
R000`s R000`s
Cash flows generated from operations 22 472 13 782
Cash flows from operating activities 20 366 13 321
Cash flows from investing activities (13 385) (16 397)
Cash flows from financing activities 390 (912)
Net increase/(decrease) in cash and 7 371 (3 988)
cash equivalents
Cash and cash equivalents at the 17 044 22 614
beginning of the period
Cash and cash equivalents at the end 24 415 18 626
of the period
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited
six months ended six months ended
31 August 2011 31 August 2010
R000`s R000`s
Share capital 918 903
Balance at the beginning of the 918 865
period
Issue of shares - 38
Share premium 254 702 252 957
Balance at the beginning of the 254 702 246 850
period
Issue of shares - 6 107
Revaluation reserve 6 150 6 150
Retained income 179 057 149 577
Balance at the beginning of the 171 049 141 958
period
Profit for the period in total 8 008 7 619
comprehensive income
Balance at end of the period 440 827 409 587
CONDENSED SEGMENT RESULTS
Segment information is presented in the condensed unaudited
consolidated financial statements in respect of the Group`s business
segments.
The business segment reporting format reflects the Group`s management
and internal reporting structure. Segment results include items
directly attributable to a segment as well as those that can be
allocated on a reasonable basis.
Dolomite &
Silica limestone Other Total
R000`s R000`s R000`s R000`s
31 August 2011
Turnover from external 41 607 87 368 - 128 975
customers
Inter-segment revenues - - 7 200 7 200
Net profit before tax 5 210 11 538 (5 526) 11 222
31 August 2010
Turnover from external 40 047 82 835 282 123 164
customers
Inter-segment revenues 42 - 3 600 3 642
Net profit before tax 5 588 12 724 (7 225) 11 087
Product volumes
Silica Dolomite
2011 2010 2011 2010
Tons sold 146 230 140 408 568 732 563 636
Tons produced 152 385 141 369 554 608 555 888
Limestone Total
2011 2010 2011 2010
Tons sold 186 719 180 954 901 681 884 998
Tons produced 195 831 182 124 902 824 879 381
MANAGEMENT COMMENTARY
Infrasors
Infrasors is a South African mining resources company, mining and
producing a spread of minerals for the industrial, mining and
construction sectors.
Its operations are conducted at its Lyttelton Centurion mine, Marble
Hall mine, Delf Sand mine and its Delf Tongaat facility. The Group is
currently focused on moving forward its proposed Delf Cullinan and
Pienaarspoort mines to serve the local silica markets.
Financial review
Revenue for the period under review was R130,9 million (2010: R124,8
million). The gross profit from operating activities for the period
under review was R37,5 million (2010: R36,1 million), an increase of
R1,4 million (3,9%). The profit before taxation for operations for the
period under review was R11,2 million (2010: R11,1 million), an
increase of R0,1 million (0,9%). The analysis of turnover and profit
before tax on a segmented basis is detailed herein. The ongoing
capital expenditure resulted in an increase in depreciation to R8,2
million (2010: R6,0 million). Net finance cost reduced to R2,6 million
(2010: R3,5 million), due to a reduction in average capital balances
owing to financial institution. Higher production levels experienced
in the period and increased consumables resulted in an increase in
inventory.
Cash from operating activities generated R20,4 million (2010: R13,3
million) which increased as a result of improved working capital
management and improved results from operations. The improved working
capital management resulted in an increase in trade payables. A cash
outflow from investing activities of R13,4 million (2010: R16,4
million) as a result of a reduction in capital expenditure was
incurred. The inflow of financing activities of R0,4 million (2010:
outflow R0,9 million) was a result of finance arranged on plant and
equipment procured.
Capital expenditure of R11,9 million (2010: R16,0 million) was
incurred in the period under review, reflecting an ongoing investment
by the Group in plant infrastructure and mine development.
Operational review
The Group`s sold volumes showed a marginal improvement. The strike
actions that took place in the steel industry severely impacted the
Group`s July and August results as various customers were forced to
cease or slow down their operations. Normal steel industry off-take
only returned towards the end of August.
Overall the metallurgical market saw a decline during the past period
but is anticipated to show improvement going forward. The foundry
industry has continued to show signs of slow recovery with the trend
expected to continue. Both these sectors` volumes were constrained by
the steel strike. Though the construction sector is under pressure, a
number of supply contracts were obtained under competitive conditions
which boosted construction material sales with volumes expected to be
maintained through the next period. However a tailing off of the tile
adhesive market was experienced with volumes expected to marginally
decline going forward. The powders market declined marginally and is
anticipated to improve in the first three months of the calendar year
2012.
Regulatory approval has been obtained for the expansion of the mining
footprint at the Lyttelton Centurion mine thereby securing its life of
mine potential. Delf Sand mine is in the process of applying for
enlarging its mining footprint. The drilling programme and geological
modelling at the proposed Delf Cullinan mine was completed and
followed by the implementation of required specialist studies
necessary for the mine design and required regulatory approvals.
Analysis of the Pienaarspoort Silica Quartz bulk sample continued
after its extraction at the beginning of the year.
There have been no material changes in the Group`s mineral reserves
during this period.
NOTES TO THE UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Significant accounting policies
Infrasors is a company domiciled in South Africa. The unaudited
condensed consolidated financial statements of Infrasors for the six
months ended 31 August 2011 comprise the Company and its subsidiaries
(together referred to as the "Group").
The unaudited condensed consolidated financial statements were
authorised for issue by the directors on 20 October 2011 for
publication on 24 October 2011.
The unaudited condensed consolidated financial statements for the six
months ended 31 August 2011 have been prepared by the Financial
Director, Mr M Potgieter CA(SA) and have not been reviewed or audited
by the Companies` auditors, Mazars.
1.1 Basis of preparation
The unaudited condensed consolidated financial statements for the
period have been prepared in accordance with and contain the
information required by IAS 34 Interim Financial Reporting, as well as
AC 500 series issued by the Accounting Practices Board, the JSE
Limited Listings Requirements and in compliance with the South African
Companies Act, 71 of 2008. The unaudited condensed consolidated
financial statements are prepared on the historical cost basis, with
the exception of certain financial instruments and investment property
which are measured at fair value. The results of the interim period
are not necessarily indicative of the results for the entire year, and
these unaudited financial statements should be read in conjunction
with the audited financial statements for the year ended 28 February
2011.
The preparation of unaudited condensed consolidated financial
statements requires the use of estimates and assumptions that affect
the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the unaudited
condensed consolidated financial statements and the reported amounts
of revenue and expenses during the reporting periods. Although these
estimates are based on management`s best knowledge of current events
and actions that the Group may undertake in the future, actual results
may differ from those estimates.
The accounting policies and methods of computation are in terms of
IFRS and have been applied consistently by the Group to all periods
presented in these unaudited condensed consolidated financial
statements. All comparative figures throughout this report relate to
the corresponding period of the prior year.
2. Earnings per share ("EPS") reconciliation - Basic and diluted
EPS is based on the Group`s profit for the six months ended 31 August
2011, divided by the weighted average number of shares in issue during
the six-month period and its comparative six-month period ended 31
August 2010.
Six months ended Six months ended
31 August 2011 31 August 2010
Weighted Weighted
average average
number Earnings number Earnings
Net of shares per Net of shares per
profit in issue share profit in issue share
R000`s 000`s Cents R000`s 000`s Cents
8 008 183 709 4,4 7 619 179 991 4,2
Headline earnings per share ("HEPS") reconciliation - Basic and
diluted
HEPS is based on the Group`s headline earnings divided by the weighted
average number of shares in issue during the six months ended 31
August 2011 and its comparative six-month period ended 31 August 2010.
Six months ended Six months ended
31 August 2011 31 August 2010
Weighted Weighted
average Headline average Headline
number earnings number earnings
Net of shares per Net of shares per
profit in issue share profit in issue share
R000`s 000`s Cents R000`s 000`s Cents
Net profit 8 008 7 619
Loss on sale - 440
of assets
Tax effect - (123)
on headline
adjustments
8 008 183 709 4,4 7 936 179 991 4,4
3. Dividends
The directors have elected not to declare a dividend for the six-
months ended 31 August 2011 (2010: Rnil).
4. Related party transactions
Unaudited Unaudited
six months ended six months ended
31 August 2011 31 August 2010
R000`s R000`s
Product purchases between fellow - 42
subsidiary companies
Management fees and cost recoveries 7 200 6 600
paid to Infrasors Holdings Limited
Management fees paid to Infrasors 7 200 3 600
Holdings Limited
Cost recoveries paid to Infrasors - 3 000
Holdings Limited
Interest paid by subsidiaries to 155 191
holding company
Contributions made to the Infrasors 519 1 201
Environmental Rehabilitation Trust
Rent paid to Whirlprops 35 385 301
(Proprietary) Limited
5. Subsequent events
No material subsequent events have been identified.
6. Directorate
Mochele Noge (Independent Non-Executive Chairman) (appointed as
Chairman 1 March 2011)
Stephen Courtney (Non-Executive Deputy Chairman) (appointed as Deputy
Chairman 1 March 2011)
Trevor Robinson (Chief Executive Officer)
Marius Potgieter (Financial Director)
Chris Boulle (Independent Non-Executive Director)
Kerry Colley (Company Secretary)
All of the above directors are South African and resident in South
Africa.
On behalf of the board
M Noge T Robinson
Chairman Chief Executive Officer
Sponsor
Sasfin Capital
A division of Sasfin Bank Limited
Legal Advisers and Attorneys
HR Levin Attorneys Notaries and Conveyancers
Auditors
Mazars
Transfer Secretaries
Link Market Services South Africa (Proprietary) Limited
VISIT US AT www.infrasors.co.za
"RESOURCES FOR GROWTH"
24 October 2011
Date: 25/10/2011 07:30:02 Supplied by www.sharenet.co.za
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