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GRF - Group Five Limited - Unaudited interim group results for the six months

Release Date: 13/02/2012 08:00
Code(s): GRF
Wrap Text

GRF - Group Five Limited - Unaudited interim group results for the six months ended 31 December 2011 GROUP FIVE LIMITED (Registration number: 1969/000032/06) (Incorporated in the Republic of South Africa) Share Code: GRF ISIN Code: ZAE000027405 GROUP FIVE Structured ingenuity Unaudited interim group results for the six months ended 31 December 2011 371 Rivonia Boulevard, Rivonia / PO Box 3951, Rivonia 2128, South Africa Tel: +27 11 806 0111, 0860 55 55 56 / Fax: +27 11 803 5829 Email: info@groupfive.co.za / www.groupfive.co.za Incorporated in the Republic of South Africa / Reg. no. 1969/000032/06 JSE code: GRF ISIN: ZAE 000027405 Revenue from continuing operations (R`millions) down 4% Dec 11 4 407 Dec 10 4 571 Operating profit from continuing operations Including fair value adjustments (R`millions) down 40% Dec 11 219 Dec 10 368 Cash and cash equivalents from continuing operations (R`millions) up 117m Dec 11 2 335 June 11 2 218 Fully diluted headline earnings per share (cents) down 44% Dec 11 130 Dec 10 233 Earnings per share (cents) up Dec 11 89 profit Dec 10 354 loss Commentary Introduction The weakness in the general domestic construction and engineering markets in which the Group operates has continued during the period, exacerbated by unpredictable delays in certain public infrastructure expenditure in South Africa as well as postponements in mining resource capital programmes. In contrast to this, the African mining resources, power and energy sectors are recovering. The group`s emphasis on a larger geographic footprint for more of its business units in Africa has assisted all three construction segments in a small way to mitigate some of the domestic market weakness. The Group continued to implement its conservative approach adopted last year in terms of both the quality of the order book and cash preservation to fund activity supporting future profit growth. It is thus encouraging to see a modest improvement in the construction order book, with the good cash position supporting this strategy. However, the overall Group performance during the period was impacted by delayed construction revenue due to contract delays and client scope changes. Losses in Construction Materials, holding costs and losses from one previously reported contract in the Middle East also impacted results. Financial performance As per the cautionary announcement of 27 January 2012, based on the Group`s operational and strategic focus, as well as the poor outlook for the construction market in the South Gauteng region, the board of directors of Group Five resolved to dispose of the businesses that constitute the Construction Materials cluster. The Group is currently in discussions with several parties to effect these disposals. If successfully concluded, the disposals may have an effect on the price of the company`s shares. Accordingly, shareholders are advised to continue to exercise caution when trading in the company`s shares until a further announcement has been made. The Group is therefore required to account for the Construction Materials operating cluster as a discontinued operation and Non-Current Assets classified as Held for Sale. Accounting practice requires the comparatives reported in this announcement to be restated to reflect the effect of the discontinued operations on those periods. The results are thus presented indicating the previously reported values and the restated amounts. The commentary below refers to the restated values only. Headline earnings per share (HEPS) decreased by 48.2% from 251 cents per share to 130 cents per share and fully diluted HEPS (FDHEPS) by 44.2% from 233 cents per share to 130 cents per share. Earnings per share (EPS) improved from a loss of 354 cents per share to earnings of 89 cents per share in the current year and fully diluted EPS (FDEPS) improved from a loss of 354 cents per share to earnings of 89 cents per share. Revenue from continuing operations decreased by 3.6% from R4,6 billion to R4,4 billion, mainly due to a reduction in activity levels within the civil infrastructure markets. Operating profit, including fair value adjustments but before impairment adjustments, decreased by 40.5% from R368 million to R219 million. Fair value net upward adjustments of R49,9 million (H1 F2011: R10,4 million) were recorded during the period relating to the group`s interests in Eastern European service concessions and its interest in property developments. Operating profit before fair value adjustments and impairment adjustments decreased by 52.8% from R358 million to R169 million. Included within operating profit is a deficit on the group`s pension fund of R3 million in H1 F2011. The group`s operating margins are reflected below. For comparative purposes, the Group provides both the total operating margin as well as the operating margin net of non-core/headline transactions of pension fund surpluses and deficits and profit/loss on sale or impairment of subsidiaries. The Group refers to the latter margin as the core operating margin, as it reflects the underlying operating performance. (The group discloses the numbers both including and excluding fair value adjustments in the table below). H1 F2012 H1 F2011 H2 F2011 Six months Six months Six months ended ended ended
31 December 31 December 30 June 2011 2010 2011 Revenue - (R`000) 4 598 691 4 811 683 4 395 315 Revenue - continuing operations 4 406 818 4 570 978 4 201 787 (R`000) Total operating margin including 5.0 8.1 5.9 fair value adjustments % Total operating margin excluding 3.8 7.8 5.0 fair value adjustments % Core operating margin including 5.0 8.1 5.9 fair value adjustments % Core operating margin excluding 3.9 7.9 5.0 fair value adjustments Notes: Total operating margin % is defined as operating profit before impairment adjustments as a % of revenue from continuing operations. Core operating margin % is defined as total operating margin % adjusted for the non-core transactions listed above. In line with expectations, net finance income of R1,9 million was recorded during the period compared to net finance income of R26,0 million in the prior period and net finance income of R19,8 million in H2 F2011. The group recognised a tax expense of R65 million, mainly due to taxation from African jurisdictions with taxation rates higher than the South African corporate tax rate, as well as a conservative approach adopted to the raising of deferred taxation assets. Financial position It is pleasing to note that the Group`s statement of financial position continues to be sound, with a nil net gearing ratio and bank balances and cash of R2,3 billion as at 31 December 2011. The statement of financial position has been restated to reflect the required changes, accounting for Construction Materials as a discontinued operation, as outlined above. During the prior year, the Group processed a gross impairment of R550 million in its Construction Materials business due to management concluding that the foreseeable market valuation of the aggregate and certain readymix assets was considerably less than the current carrying amount on the statement of financial position. This impairment was in addition to the gross impairment of R326 million taken at 30 June 2010. The prior year`s impairments and operating losses (net of taxation) are now reflected as discontinued losses in the prior reporting periods. No impairment to carrying value of these assets has been recorded in the current period under review. The current year`s discontinued loss represents both the operating losses from Construction Materials net of taxation, as well as an amount of R10,8 million (H1 F2011: R9,3 million) which was charged to the income statement, mainly as a result of the assessment of the amount due from contract claims on a terminated Indian toll road contract which continues through arbitration. Cash flow The group generated R236 million cash from operations before working capital changes (H1 F2011: R417 million) and generated R355 million from operations (H1 F2011 R390 million utilised). The improvement in working capital was as a result of an increase in advance payments received and excess billings charged, as well as a corresponding decrease in work in progress balances. Dividend The group`s adopted dividend policy is approximately four times basic earnings per share dividend cover. In line with this policy, a dividend for this period of 22 cents per share (H1 F2011: 52 cents) has been declared. The dividend policy therefore remains unchanged, based on the medium term business outlook and the availability of liquid resources. Business combinations There were no business combinations in the period under review. As mentioned above, the Group has resolved to dispose of its Construction Materials businesses. Construction Materials comprises sand and aggregates, readymix and extenders and mining crushing services. The construction materials market in Gauteng where Construction Materials operate has remained heavily oversupplied with insufficient work being available to quarry owners who need to move quality materials at heavily discounted prices. Competitors with the benefit of an integrated offering through the value chain of cement, aggregates and readymix concrete and others with mobile crushing operations that locate from opportunity to opportunity have survived this extended downturn better than fixed quarry businesses. Revenue for Construction Materials for the six months decreased by 20.3% from R241 million to R192 million, with a core operating loss of R31 million (H1 F2011: loss of R33 million). The loss on discontinuance is reported at R30,1 million (H1 F2011: R572 million). Management has concluded that Construction Materials cannot be a core business for Group Five and will be sold. In this regard, the Group is engaging with parties who have expressed an interest in the various businesses and assets. It is acknowledged that there has been destruction in shareholder value in the Group`s venture into this market, with hard lessons learnt. This business has experienced unforeseeably historically low depressed markets and it would be costly for shareholders were the group to wait for a market recovery before exiting the business. Operational review GROUP The Group`s businesses performed broadly in line with management expectations and in accordance with the guidance provided in November 2011 when all construction margins were guided down. Group-wide restructuring and cost cutting, without losing core capacity, had a net cost in the first half. The benefits will only be realised from H2 F2012 and F2013. In addition, the Group has purposefully continued to carry costs related to its investment in future opportunities and capacity building. The benefits of these initiatives will not be realised before F2013. As expected, the period`s results were impacted by losses in the Construction Materials segment. The Civil Engineering results have been impacted in short term by losses on a Jordan pipeline contract and holding costs in the Middle East deployed to manage out legacy contracts. INVESTMENTS AND CONCESSIONS (including Infrastructure H1 F2012 H1 F2011 H2 F2011 Concessions and Property Six months Six months Six months Developments) ended ended ended 31 December 31 December 30 June 2011 2010 2011 Revenue - (R`000) 320 250 282 361 272 298 Total operating margin including 27.6 17.5 21.9 fair value adjustments % Total operating margin excluding 12.0 13.8 7.8 fair value adjustments % Core operating margin % including 27.8 17.8 22.5 fair value adjustments % Core operating margin excluding fair 12.2 14.1 8.4 value adjustments Investments and Concessions consists of Infrastructure Concessions and Property Developments. This cluster contributed 7.3% (H1 F2011: 6.2%) to group revenue. Infrastructure Concessions In spite of sluggish domestic concessions and PPP activities and the economic pressures in Europe, Infrastructure Concessions performed ahead of expectations as new tolling contracts came on line in Eastern Europe. Revenue increased by 13.8% to R306 million (H1 F2011: R269 million), core operating margin improved to 25.8% (H1 F2011: 20.3%), with core operating profit at R79 million (H1 F2011: R54 million). The changes in the carrying value of concession assets are regarded and accounted for globally as a core component of the concessions business. Included in core operating profit are upward fair value adjustments on service concessions of R39 million (H1 F2011: R10 million). Eastern European and growing African concession opportunities are set to remain attractive, with further new projects under development in transport projects and power. Going forward, the timing of awards in the South African public sector buildings and healthcare PPPs and transport concession markets remains uncertain in light of current delays and unconvincing government policy and commitment. The uncertainty over whether the N1/N2 Winelands toll road project, awarded to the consortium led by Group Five, will go ahead, is just one example. The outcome of the government`s deliberations on the resolution of the Gauteng Freeway Tolling impasse and of the recently established Presidential Infrastructure Coordinating Commission will be crucial for the construction sector and job creation. The group is, however, encouraged by the private sector`s commitment to renewable energy. The Group is well positioned to participate. It will be crucial for this programme to meet the stated deadlines for quick adjudication and award to pre-qualified bidders who are able to demonstrate bankability. Property Developments Property Developments` revenue increased by 6.8% to R15 million (H1 F2011: R14 million) and core operating profit to R10,2 million (H1 F2011: R4, 2 million loss). Included in core operating profit is an upward fair value adjustment on property developments of R11 million (H1 F2011: nil). Property Developments returned to profitability in line with the Group`s stated expectations. The Group continues to progress its strategy of disinvestment from the traditional residential sector in favour of securing A-grade commercial and retail property development positions in targeted geographies. MANUFACTURING H1 F2012 H1 F2011 H2 F2011 Six months ended Six months ended Six months ended 31 December 2011 31 December 2010 30 June 2011
Revenue - (R`000) 495 973 405 138 462 385 Total operating margin % 4.4 7.8 (1.2) Core operating margin % 4.4 7.9 (1.2) Manufacturing consists of building products business, Everite, as well as steel fabrication businesses BRI and Group Five Pipe. Manufacturing contributed 11.3% (H1 F2011: 8.9%) to Group revenue. Revenue increased by 22.4% from R405 million to R496 million. Core operating profit decreased by 32.0% from R32 million to R22 million, resulting in a core operating margin of 4.4% (H1 F2011: 7.9%). Core operating margin for H2 F2011 was a loss of 1.2%. Investments in production technologies, product range extension and the closure of the troubled steel fabrication facility have led to improving competitiveness and domestic and export market growth. An increase in volumes traded in Everite and BRI during the reporting period lifted the manufacturing performance from the last reported results. Group Five Pipe remains tied to large water transport project demand, which exhibits some loading unpredictability in the short term. In the period under review, further progress was made in developing the Group`s Advanced Building Technologies (ABT) product offering into the housing and building market. CONSTRUCTION H1 F2012 H1 F2011 H2 F2011 Six months ended Six months ended Six months 31 December 2011 31 December 2010 ended 30 June 2011
Revenue - (R`000) 3 590 595 3 883 479 3 467 104 Total operating margin % 3.0 7.4 5.6 Core operating margin % 3.0 7.4 5.5 Construction comprises the business segments of Building and Housing, Civil Engineering and Engineering. Engineering incorporates the businesses of Projects and Engineering & Construction (E+C). Construction continued to be the largest cluster in the group, contributing 81.5% to Group revenue (H1 F2011: 85.0%). Construction revenue decreased by 7.5% from R3,9 billion to R3,6 billion and core operating profit decreased by 62.1% to R109 million (H1 F2011: R288 million). Over-border work contributed 26% (H1 F2011: 25%) to Construction revenue. The overall Construction core operating margin period on period declined from 7.4% to 3.0%. The core operating margin in H2 F2011 was 5.5%. Construction performance was impacted by delayed revenue due to postponements in domestic contract awards and customer-initiated scope change delays, as well as holding costs and losses in the Middle East from one contract as previously reported. In addition, the Group purposefully continued to carry costs related to its investment in future opportunities and capacity building in renewable power, nuclear readiness, postponed local and new over-border PPPs, as well as oil and gas and geographic expansion. As stated above, the benefits of these initiatives will not be realised before F2013. Building and Housing H1 F2012 H1 F2011 H2 F2011 Six months ended Six months ended Six months ended
31 December 2011 31 December 2010 30 June 2011 Revenue - (R`000) 1 310 766 1 215 101 927 903 Total operating margin % 2.6 7.5 5.0 Core operating margin % 2.6 7.5 4.9 Revenue increased by 7.9% from R1,2 billion (79% local) to R1,3 billion (80% local). Core operating profit decreased by 63.4% to R33 million (H1 F2011: R91 million), resulting in a core operating margin of 2.6% (H1 F2011: 7.5%). Core operating margin for H2 F2011 was 4.9%. During the period, the private sector property market for buildings remained weak and overtraded, with inherently low margins and unattractive cash flows. This has been coupled with the slowdown in government`s promised infrastructure spend and the lack of awards of certain PPP concession projects, including large public buildings, healthcare and correctional services. The Group has been declared the preferred bidder on some of these projects. The coastal region performed well, although margins were constrained. The Building and Housing segment established an over-border capability in new markets, which will mitigate some domestic market decline. In the short term the Building business will be under pressure while markets are further developed and while new awards against tenders under adjudication are awaited. The Housing business has, however, seen a recent marked improvement in domestic mining and affordable and RDP housing work load. The secured one-year order book stands at R2, 4 billion (85% local) (FY 2011: R2,1 billion and 88% local) and total secured work at R3,6 billion (77% local) (FY 2011: R3,1 billion (75% local)). Civil Engineering H1 F2012 H1 F2011 H2 F2011
Six months Six months Six months ended ended ended 31 December 31 December 30 June 2011 2010 2011
Revenue - (R`000) 1 217 078 1 863 462 1 684 899 Total operating margin % 2.6 6.9 6.1 Core operating margin % 2.6 7.0 6.1 Civil Engineering includes the Group`s civil engineering activities in South Africa, the rest of Africa and the Middle East. Civil Engineering revenue decreased by 34.7% from R1, 9 billion (86% local) to R1,2 billion (78% local). Core operating profit decreased by 75.4% from R130 million to R32 million, accompanied by a decrease in overall core operating margin to 2.6% from 7.0% in the corresponding period and 6.1% in H2 F2011. As outlined above, the Civil Engineering result has been impacted by revenue and margin shifting out in time due to late contract awards and hence delayed starting times, as well as scope changes on several large domestic projects. Against this, the underlying South African and African business delivered well on contracts executed in the period. In the Middle East slow but positive progress continues to be achieved in contract resolution, including cash recovery. The Jordan pipeline project, however, has returned further losses. This project is in the process of being terminated by mutual agreement with the contracting parties. In addition, costs are being expensed as they occur for the commercial resources deployed in Dubai which continue working through the contractual finalisation and cash collection of completed, but not commercially closed, as well as terminated contracts. Although tendering activity is high and increasing in South Africa and the rest of Africa, awards are currently infrequent. The business is proactively mitigating domestic market conditions by progressively rebuilding its African order book in geographies in which the Group has prior operating experience and where growth opportunities are stronger. The Group expects meaningful contract awards and margin improvement in Civil Engineering to realise over the next 12 months derived from intervention in the Middle East and its South Africa and Rest of Africa tender opportunity pipeline in targeted sectors of mining, power, water and environment and transport. Civil Engineering`s secured one-year order book stands at R2,5 billion (48% local) compared to R2,5 billion (57% local) as at 30 June 2011. The full order book is at R4,1 billion (48% local) (FY 2011 R3, 7 billion (58% local)). Engineering H1 F2012 H1 F2011 H2 F2011
Six months Six months ended Six months ended ended 31 December 2010 30 June 31 December 2011 2011
Revenue - (R`000) 1 062 751 804 916 854 302 Total operating margin % 4.1 8.3 5.2 Core operating margin % 4.1 8.4 5.2 The Engineering cluster is the Group`s engineering and plant building segment and incorporates the Projects business and the Engineering & Construction (E+C) business. Engineering is experiencing a recovery in enquiry levels from the sub-Saharan African mining and energy markets, which resulted in new contract awards during the period under review. This trend is expected to continue in various mineral categories, technologies and geographies. This augurs well for a sustained recovery ahead, albeit lumpy in nature. During the period, revenue increased from R805 million (44% local) to R1,1 billion (62% local), with core operating profit decreasing by 34.8% from R67 million to R44 million. Core operating margin decreased to 4.1% (H1 F2011: 8.4%). Core operating margin for H2 F2011 was 5.2%. Although the underlying contract margins are still good, they reflect increased competition. The margin for the period was also impacted by the high costs incurred in bidding for the many renewable energy projects against the REFIT (renewable energy feed-in tariff) programmes and building capacity in nuclear. The margin retraction on higher revenues is temporary and should improve over the next 12 months. The E+C business has bid with a number of the power plant developers who have pre-qualified under the REFIT 1 programme. Contract awards are expected in H1 F2013. Further bids will be submitted under the REFIT 2 programme in March 2012. The secured one-year order book was maintained at R1,4 billion (64% local) (30 June 2011: R1,4 billion secured work) (75% local). The full secured order book stands at R2,6 billion (66% local) (FY 2011: R2,0 billion (83% local)). PROSPECTS The Group`s total secured Construction order book stands at R10,3 billion (30 June 2011: R8,8 billion). The Construction one-year order book stands at R6,4 billion (30 June 2011: R5,9 billion). The value of the Group`s target opportunity pipeline stands at R144 billion, up from R134 billion in August 2011, with activity in all its markets. The Investments and Concessions cluster is delivering annuity business growth, with group-wide opportunities in active infrastructure sectors in increasingly more geographies. Manufacturing has been re-focused and its performance is improving on higher sales volumes to a broadening number of markets. The disposal of the loss-making Construction Materials business will relieve the cash drain from this segment on the Group and improve returns once completed. Based on the Group`s positioning in the key infrastructure growth sectors of power, mining, oil and gas, water and transport and in the concessions market for specific projects, as well as the progress made in terms of improving the group`s internal efficiencies, management expect a slow recovery in group activity levels from the second half of F2012. This should support some improvement in the Group`s trading performance from F2013. The timing of this recovery is dependent on the timing of awards on visible projects. ESTIMATES AND CONTINGENCIES The group makes estimates and assumptions concerning the future, particularly with regard to construction contract profit taking, provisions, arbitrations and claims and various fair value accounting policies. The resulting accounting estimates and judgments can, by definition, therefore only approximate the actual results. Estimates and judgments are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Total financial institution guarantees given to third parties on behalf of subsidiary companies amounted to R3 434 million as at 31 December 2011, compared to R4 537 million as at 30 June 2011. DIVIDEND DECLARATION The directors have declared an interim dividend number 67 of 22 cents per ordinary share (2011: 52 cents dividend) payable to shareholders. In order to comply with the requirements of Strate, the relevant details are: Event Date Last day to trade (cum-distribution) Friday, 13 April 2012 Shares to commence trading (ex-distribution) Monday, 16 April 2012 Record date (date shareholders recorded in Friday, 20 April 2012 books) Payment date Monday, 23 April 2012 No share certificates may be dematerialised or Monday, 16 April 2012 and rematerialised between Friday, 20 April 2012 BASIS OF PREPARATION These consolidated condensed interim financial statements for the six months ended 31 December 2011 have been prepared in accordance with IAS 34, "Interim Financial Reporting" and in the manner required by the Companies Act of South Africa. The consolidated condensed interim financial information should be read in conjunction with the annual financial statements for the year ended 30 June 2011, which have been prepared in accordance with International Financial Reporting Standards (IFRS). The accounting policies applied are consistent with those of the annual financial statements for the year ended 30 June 2011, as described in those financial statements. The above information has not been reviewed or reported on by Group Five`s auditors. BOARD CHANGES There were no changes to the board of directors during the period under review. ACKNOWLEDGMENTS The group wishes to recognise the hard work and commitment of its employees. On behalf of the board MP Buthelezi MR Upton Chairperson Chief Executive Officer 7 February 2012 Board of directors: P Buthelezi* (Chairperson), MR Upton (CEO), CMF Teixeira (CFO), LE Bakoro*, L Chalker*+, Dr JL Job*, OA Mabandla*, SG Morris*, KK Mpinga*, DDS Robertson*+ *(Non-executive director) + (British) (DRC) Transfer secretaries: Computershare Investor Services (Pty) Ltd, 70 Marshall Street, Johannesburg 2001 Please visit our website: www.groupfive.co.za Condensed consolidated income statement (R`000) Six months Six months Six months Full Full year ended ended ended year ended
31 Dec 2011 31 Dec 2010 31 Dec 2010 ended 30 June restated as 30 June 2011 previously 2011 as reported restated previousl
y reported Revenue 4 598 691 4 811 683 4 811 683 9 206 9 206 998 998
Continuing 4 406 818 4 570 978 4 811 683 8 772 9 206 998 operations 765 Discontinued 191 873 240 705 - 434 233 - operations Operating profit 169 123 357 997 324 575 566 986 498 828 before fair value adjustments and impairment adjustments Fair value 49 911 10 417 10 417 48 844 48 844 adjustments relating to investment in service concessions and property developments Operating profit 219 034 368 414 334 992 615 830 547 672 before impairment adjustments Impairment of - - (550 540) - (550 540) property, plant and equipment and goodwill Operating 219 034 368 414 (215 548) 615 830 (2 868) profit/(loss) Share of 126 (521) (521) 820 820 profit/(loss) from associates Finance income 38 442 64 048 58 374 106 552 96 060 Finance costs (36 501) (37 984) (46 378) (60 644) (77 699) Profit/(loss) 221 101 393 957 (204 073) 662 558 16 313 before taxation Taxation (65 227) (120 502) (94 354) (209 (158 143) 990) Profit/(loss) after 155 874 273 455 (298 427) 452 568 (141 830) taxation from continuing operations Loss for the period from discontinued operations (40 960) (581 166) (9 284) (611 (17 214) 612) Profit/(loss) for 114 914 (307 711) (307 711) (159 (159 044) the period 044) Allocated as follows: Equity shareholders 86 073 (339 362) (339 362) (218 (218 107) of Group Five 107) Limited Non controlling 28 841 31 651 31 651 59 063 59 063 interest 114 914 (307 711) (307 711) (159 (159 044) 044) Earnings/(loss) per 0,89 (3,54) (3,54) (2,27) (2,27) share - R Fully diluted 0,89 (3,54) (3,54) (2,27) (2,27) earnings/(loss) per share - R Determination of headline earnings (R`000) Six Six months Six Full year Full months ended months ended year ended 31 Dec 2010 ended 30 June ended 31 Dec restated 31 Dec 2011 30 June
2011 2010 restated 2011 as as previousl previous y ly
reported reported Attributable 86 073 (339 362) (339 362) (218 107) (218 profit/(loss) 107) Adjusted for (net of 39 511 580 145 544 249 609 766 536 989 tax) - Loss/(profit) on 5 728 (202) (202) 832 832 sale of property, plant and equipment and investment property - Loss/(profit) on 619 (819) (819) 574 574 subsidiary - Impairment of - - 535 986 - 521 621 property, plant and equipment and goodwill - Net profit on fair (7 796) - - (3 252) (3 252) value adjustments on investment property - Losses from discontinued operations 40 960 581 166 9 284 611 612 17 214
Headline earnings 125 584 240 783 204 887 391 659 318 882 Condensed consolidated statement of comprehensive income (R`000) Six Six Full year months months ended
ended ended 30 June 31 Dec 31 Dec 2011 2011 2010 Profit/(loss) for the period 114 914 (307 711) (159 044) Other comprehensive income for the period net of tax Exchange differences on translating 85 517 (64 994) (45 948) foreign operations Total comprehensive income/(loss) 200 431 (372 705) (204 992) for the period Total comprehensive income/(loss) for the period attributable to Equity shareholders of Group Five 171 590 (404 356) (264 055) Limited Non controlling interest 28 841 31 651 59 063 Total comprehensive income/(loss) 200 431 (372 705) (204 992) for the period Condensed consolidated statement of financial position (R`000) Six Six Six Full year Full months months months ended year
ended ended ended 30 June ended 31 Dec 31 Dec 31 Dec 2011 30 June 2011 2010 2010 restated 2011 restated as as
previousl previous y ly reported reported
ASSETS Non-current assets Property, plant 905 021 894 788 1 529 649 857 459 1 430 and equipment 457 and investment property Investments - 300 199 243 693 243 693 253 100 253 100 service concessions Investments - 8 691 128 691 128 691 8 691 8 691 property developments Other non- 174 911 159 381 178 206 213 725 227 745 current assets 1 388 1 426 2 080 239 1 332 975 1 919
822 553 993 Current assets Other current 3 682 3 384 3 539 915 3 406 469 3 562 assets 210 044 973 Bank balances 2 335 2 418 2 417 047 2 218 334 2 234 and cash 460 363 779 6 017 5 802 5 956 962 5 624 803 5 797 670 407 752
Non-current 692 995 867 474 59 233 813 200 53 233 assets classified as held for sale Total assets 8 099 8 096 8 096 434 7 770 978 7 770 487 434 978 EQUITY AND LIABILITIES Capital and reserves Equity 2 311 2 030 2 030 748 2 148 130 2 148 attributable to 776 748 130 equity holders of the parent Non controlling 102 052 93 638 93 638 117 565 117 565 interest 2 413 2 124 2 124 386 2 265 695 2 265 828 386 695 Non-current liabilities Interest bearing 132 526 727 762 832 349 155 524 232 203 borrowings Other non- 50 267 26 448 62 558 77 482 87 326 current liabilities 182 793 754 210 894 907 233 006 319 529 Current liabilities Other current 5 280 4 859 5 059 644 4 970 925 5 185 liabilities 606 894 754 Bank overdrafts - 17 497 17 497 - - 5 280 4 877 5 077 141 4 970 925 5 185
606 391 754 Liabilities 222 260 340 447 - 301 352 - associated with non-current assets held for sale Total equity and 8 099 8 096 8 096 434 7 770 978 7 770 liabilities 487 434 978 Condensed consolidated statement of cash flow (R`000) Six Six Six Full year Full year months months months ended ended
ended ended ended 30 June 30 June 31 Dec 31 Dec 31 Dec 2011 2011 2011 2010 2010 restated as restated as previously
previousl reported y reported Cash flow from operating activities Profit before 236 035 417 021 462 188 780 252 756 256 working capital changes Working 118 810 (807 (805 481) (1 360 (1 237 capital 237) 197) 775) changes Cash 354 845 (390 (343 293) (579 945) (481 519) generated/ 216) (utilised) from operations Finance income 1 941 26 064 11 996 45 908 18 361 - (net) Taxation and (95 124) (192 (192 451) (375 756) (375 756) dividends paid 451) Net cash 261 662 (556 (523 748) (909 793) (838 914) generated/ 603) (utilised) by operating activities Property, (110 (47 807) (58 754) (53 360) (48 800) plant and 332) equipment and investment property (net) Investments (22 129) (20 594) (20 594) 117 517 117 517 (net) Net cash (132 (68 401) (79 348) 64 157 68 717 (utilised)/ 461) generated in investing activities Net cash (67 057) (27 523) (49 431) (51 110) (92 809) utilised in financing activities Effects of 80 068 (53 739) (53 739) (8 032) (8 032) exchange rates on cash and cash equivalents Net cash (25 086) 890 - 16 870 - (utilised)/ generated by discontinued operations Net increase/ 117 126 (705 (706 266) (887 908) (871 038) (decrease) in 376) cash and cash equivalents Condensed consolidated segmental analysis (R`000) % Six months Six chang ended months
e 31 Dec 2011 ended 31 Dec 2010 restated
REVENUE Investments and 13 320 250 282 361 Concessions Infrastructure Concessions 14 305 519 268 567 Property Developments 7 14 731 13 794 Manufacturing 22 495 973 405 138 Construction Materials - - - Construction (8) 3 590 595 3 883 479 Building and Housing 8 1 310 766 1 215 101 Civil Engineering (35) 1 217 078 1 863 462 Engineering Projects 32 1 062 751 804 916
Total revenue (4) 4 406 818 4 570 978 (R`000) H1 2012 % Core chang margin % e
OPERATING PROFIT Investments and 27.8 77 88 965 50 249 Concessions Infrastructure Concessions 25.8 45 78 757 54 455 Property Developments 69.3 343 10 208 (4 206) Manufacturing 4.4 (32) 21 587 31 860 Construction Materials - - - - Construction 3.0 (62) 109 102 288 212 Building and Housing 2.6 (63) 33 438 91 278 Civil Engineering 2.6 (75) 31 827 129 590 Engineering Projects 4.1 (35) 43 837 67 344
Total core operating 5.0 (41) 219 654 370 321 profit Adjustments for non- operational transactions Pension fund deficit - (3 000) (Loss)/profit on sale of (619) 1 093 subsidiary Reported operating profit 219 034 368 414 Condensed consolidated segmental analysis continued (R`000) Six months Full year Full year ended ended ended 31 Dec 2010 30 June 30 June
as previously 2011 2011 reported restated as previousl y
reported REVENUE Investments and Concessions 282 361 554 659 554 659 Infrastructure Concessions 268 567 522 870 522 870 Property Developments 13 794 31 789 31 789 Manufacturing 405 138 867 523 867 523 Construction Materials 240 705 - 434 233 Construction 3 883 479 7 350 583 7 350 583 Building and Housing 1 215 101 2 143 004 2 143 004 Civil Engineering 1 863 462 3 548 361 3 548 361 Engineering Projects 804 916 1 659 218 1 659 218
Total revenue 4 811 683 8 772 765 9 206 998 (R`000) OPERATING PROFIT Investments and Concessions 39 832 111 469 62 624 Infrastructure Concessions 44 038 106 336 73 176 Property Developments (4 206) 5 133 (10 552) Manufacturing 31 860 26 342 26 342 Construction Materials (33 422) - (68 157) Construction 288 212 480 318 480 318 Building and Housing 91 278 136 900 136 900 Civil Engineering 129 590 231 904 231 904 Engineering Projects 67 344 111 514 111 514 Total core operating profit 326 482 618 129 501 127 Adjustments for non- operational transactions Pension fund deficit (3 000) (2 000) (2 000) (Loss)/profit on sale of subsidiary 1 093 (299) (299) Reported operating profit 324 575 615 830 498 828 Condensed consolidated statement of changes in equity (R`000) Six Six months Full year months ended ended ended 31 Dec 30 June
31 Dec 2010 2011 2011 Balance at 1 July 2 265 695 2 561 412 2 561 412 Net profit/(loss) for the period 114 914 (307 711) (159 044) Other comprehensive income for the 85 517 (64 994) (45 948) period Share options expense 11 366 19 721 46 836 Distribution to non controlling (44 354) (13 068) (16 553) interest Dividends paid (19 309) (70 974) (121 008) Balance at end of period 2 413 828 2 124 386 2 265 695 Statistics (R`000) Six months Six months ended ended 31 Dec 2011 31 Dec 2010 restated
Number of ordinary shares 96 023 132 95 910 170 Shares in issue 121 571 162 120 911 817 Less: Shares held by share trusts (25 548 (25 001 030) 647)
Weighted average number of shares (`000s) 96 545 95 910 Fully diluted weighted average number of 96 750 103 467 shares (`000s) Earnings/(loss) per share - R 0,89 (3,54) Headline earnings per share - R 1,30 2,51 Fully diluted earnings/(loss) per share - 0,89 (3,54) R Fully diluted headline earnings 1,30 2,33 per share - R Dividend per share (cents) 22,0 52,0 Interim 22,0 52,0 Final - - Net asset value per share - R 24,1 21,2 Net debt to equity ratio - - Current ratio 1.1 1.2 Statistics continued (R`000) Six months Full year Full year ended ended ended 31 Dec 2010 30 June 30 June as 2011 2011
previously restated as reported previously reported Number of ordinary shares 95 910 170 96 004 779 96 004 779 Shares in issue 120 911 817 121 477 858 121 477 858 Less: Shares held by share (25 001 (25 473 (25 473 trusts 647) 079) 079) Weighted average number of 95 910 96 114 96 114 shares (`000s) Fully diluted weighted average 103 467 101 137 101 137 number of shares (`000s) Earnings/(loss) per share - R (3,54) (2,27) (2,27) Headline earnings per share - 2,14 4,07 3,32 R Fully diluted earnings/(loss) (3,54) (2,27) (2,27) per share - R Fully diluted headline 1,98 3,87 3,15 earnings per share - R Dividend per share (cents) 52,0 72,0 72,0 Interim 52,0 52,0 52,0 Final - 20,0 20,0 Net asset value per share - R 21,2 22,38 22,38 Net debt to equity ratio - - - Current ratio 1.2 1.1 1.1 Capital expenditure and depreciation (R`000) Six Six Six Full Full year months months months year ended ended ended ended ended 30 June
31 Dec 31 Dec 31 Dec 30 June 2011 2011 2010 2010 2011 as restate as restate previousl d previousl d y
y reported reported Capital expenditure 148 278 60 720 72 575 134 736 150 352 for the period Capital expenditure 282 042 90 852 109 852 183 072 203 745 committed or authorised at the period end Depreciation for 78 260 94 543 117 530 166 888 211 557 the period Date: 13/02/2012 08:00:01 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. 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.

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