Wrap Text
BDM - Buildmax Limited - Audited abridged consolidated financial results for
the year ended 29 February 2012
BUILDMAX LIMITED
Incorporated in the Republic of South Africa
Registration No. 1995/012209/06)
Share Code: BDM
ISIN Code: ZAE000011250
("Buildmax" or "the group" or "the company")
Audited abridged consolidated financial results
for the year ended 29 February 2012
Highlights
* EBITDA from continuing operations increased by R150,4 million (117,5%)to a
profit of R278,3 million
* PBIT from continuing operations increased by R355,6 million to a profit of
R96,6 million
* PBT from continuing operations increased by R352,6 million to a profit of
R71,1 million
Audited abridged consolidated statement of financial position
29 February 28 February
2012 2011
R`000 R`000
ASSETS
Non-current assets
Property, plant and equipment 711 649 613 915
Goodwill and other intangible 92 596 98 504
assets
Environmental guarantee investment 422 -
Deferred taxation 17 331 12 124
821 998 724 543
Current assets
Inventories 21 923 44 832
Trade and other receivables 162 991 155 001
Taxation receivable 5 087 4 425
Bank and cash balances 108 869 127 029
298 870 331 287
Assets classified as held for sale - 53 543
Total assets 1 120 868 1 109 373
EQUITY AND LIABILITIES
Share capital and premium 2 023 206 2 023 206
Cash flow hedging reserve (280) (2 453)
Accumulated loss (1 468 863) (1 463 301)
Attributable to equity holders of 554 063 557 452
the company
Outside shareholders` interests (7 043) (7 328)
Total shareholders` interests 547 020 550 124
Non-current liabilities
Interest-bearing liabilities 147 943 101 886
Derivative instruments - 290
Provisions 889 4 751
Deferred taxation 53 682 28 948
202 514 135 875
Current liabilities
Interest-bearing liabilities 176 499 174 764
Derivative instruments 389 3 118
Trade and other payables 191 721 190 580
Provisions 2 300 25 471
Taxation payable 336 883
Bank overdrafts 89 9 261
371 334 404 077
Liabilities directly associated - 19 297
with assets classified as held for
sale
Total equity and liabilities 1 120 868 1 109 373
Shares in issue 3 444 716 3 444 716
Net asset value per share (cents) 16,1 16,2
Net tangible asset value per share 13,9 13,9
(cents)
Audited abridged consolidated statement of comprehensive income
Continuing Discon- Total
tinued
operations operations operations
year ended year ended year ended
29 February 29 February 29 February
2012 2012 2012
R`000 R`000 R`000
Revenue 1 087 503 184 549 1 272 052
Operating profit/(loss) 278 340 (6 487) 271 853
before depreciation and
amortisation ("EBITDA")
Depreciation (175 867) (5 917) (181 784)
Operating profit/(loss) 102 473 (12 404) 90 069
before amortisation
Amortisation of intangible (5 908) - (5 908)
assets
Operating profit/(loss) 96 565 (12 404) 84 161
Loss on disposal of - (41 827) (41 827)
businesses
Impairment losses - - -
Profit/(loss) before interest 96 565 (54 231) 42 334
and taxation ("PBIT")
Net interest paid (25 449) (2 085) (27 534)
Profit/(loss) before taxation 71 116 (56 316) 14 800
("PBT")
Taxation (19 913) (164) (20 077)
Profit/(loss) for the year 51 203 (56 480) (5 277)
Other comprehensive income
for the year:
Recycled portion of cash flow 2 905 - 2 905
reserve
Effective portion raised on 113 - 113
cash flow hedge
Taxation (845) - (845)
Total comprehensive 53 376 (56 480) (3 104)
profit/(loss) for the year
Profit/(loss) for the year
attributable to:
Equity holders of the company 50 918 (56 480) (5 562)
Outside shareholders` 285 - 285
interests
51 203 (56 480) (5 277)
Total comprehensive
profit/(loss) for the year
attributable to:
Equity holders of the company 53 091 (56 480) (3 389)
Outside shareholders` 285 - 285
interests
53 376 (56 480) (3 104)
Continuing Discon- Total
tinued
operations operations operations
year ended year ended year ended
28 February 28 February 28 February
2011 2011 2011
R`000 R`000 R`000
Revenue 1 028 433 340 781 1 369 214
Operating profit/(loss) 127 973 4 728 132 701
before depreciation and
amortisation ("EBITDA")
Depreciation (171 233) (35 462) (206 695)
Operating profit/(loss) (43 260) (30 734) (73 994)
before amortisation
Amortisation of intangible (11 298) - (11 298)
assets
Operating profit/(loss) (54 558) (30 734) (85 292)
Loss on disposal of - - -
businesses
Impairment losses (204 467) (91 253) (295 720)
Profit/(loss) before interest (259 025) (121 987) (381 012)
and taxation ("PBIT")
Net interest paid (22 417) (12 546) (34 963)
Profit/(loss) before taxation (281 442) (134 533) (415 975)
("PBT")
Taxation 45 629 (1 385) 44 244
Profit/(loss) for the year (235 813) (135 918) (371 731)
Other comprehensive income
for the year:
Recycled portion of cash flow 4 220 - 4 220
reserve
Effective portion raised on (1 600) - (1 600)
cash flow hedge
Taxation (733) - (733)
Total comprehensive (233 926) (135 918) (369 844)
profit/(loss) for the year
Profit/(loss) for the year
attributable to:
Equity holders of the company (228 485) (135 918) (364 403)
Outside shareholders` (7 328) - (7 328)
interests
(235 813) (135 918) (371 731)
Total comprehensive
profit/(loss) for the year
attributable to:
Equity holders of the company (226 598) (135 918) (362 516)
Outside shareholders` (7 328) - (7 328)
interests
(233 926) (135 918) (369 844)
Audited supplementary information
Continuing Discon- Total
tinued
operations operations operations
year ended year ended year ended
29 February 29 February 29 February
2012 2012 2012
R`000 R`000 R`000
Headline earnings/(loss) 0,72 (0,43) 0,29
per share (cents)
Earnings/(loss) per share 1,48 (1,64) (0,16)
(cents)
Shares in issue (`000) 3 444 716
Weighted average shares in 3 444 716
issue (`000)
Continuing Discon- Total
tinued
operations operations operations
year ended year ended year ended
28 February 28 February 28 February
2011 2011 2011
R`000 R`000 R`000
Headline earnings/(loss) (2,70) (1,70) (4,40)
per share (cents)
Earnings/(loss) per share (8,97) (5,34) (14,31)
(cents)
Shares in issue (`000) 3 444 716
Weighted average shares in 2 546 426
issue (`000)
Audited abridged consolidated statement of cash flows
Year ended Year ended
29 February 28 February
2012 2011
R`000 R`000
Operating activities
Profit/(loss) before taxation 14 800 (415 975)
("PBT")
Working capital movement (3 092) 29 547
Impairment of plant, equipment - 295 720
and intangible assets
Other non-cash flow items 192 759 183 781
Net interest paid 27 534 34 963
Cash generated from operations 232 001 128 036
Net interest paid in cash (27 257) (34 218)
Taxation paid (1 578) (3 312)
Net cash inflow from operating 203 166 90 506
activities
Investing activities
Purchase of property, plant and
equipment
- Expanding operations (334) (5 402)
- Maintaining operations (415 522) (84 548)
Environmental guarantee (600) -
investment
Proceeds on disposal of 736 -
subsidiaries
Proceeds on disposal of property 167 903 92 199
plant and equipment
Net cash (outflow)/inflow from (247 817) 2 249
investing activities
Financing activities
Net proceeds from issue of shares - 290 824
Vendor loans repaid - (43 500)
Interest-bearing liabilities 301 233 89 186
raised
Interest-bearing liabilities (265 570) (416 272)
repaid
Net cash inflows/(outflows) from 35 663 (79 762)
financing activities
Net (decrease)/increase in cash (8 988) 12 993
and cash equivalents
Cash and cash equivalents at the 117 768 104 775
beginning of the year
Cash and cash equivalents at the 108 780 117 768
end of the year
Audited abridged consolidated statement of changes in equity
Share Cash flow
capital
and hedging Accumulated
premium reserve loss
R`000 R`000 R`000
Balances as at 28 February 1 732 382 (4 340) (1 098 898)
2010
Shares issued 290 824 - -
Total comprehensive - 1 887 (364 403)
income/(loss) for the year
Balances as at 28 February 2 023 206 (2 453) (1 463 301)
2011
Total comprehensive - 2 173 (5 562)
income/(loss) for the year
Balances as at 29 February 2 023 206 (280) (1 468 863)
2012
Outside
shareholders`
interest Total
R`000 R`000
Balances as at 28 February - 629 144
2010
Shares issued - 290 824
Total comprehensive (7 328) (369 844)
income/(loss) for the year
Balances as at 28 February (7 328) 550 124
2011
Total comprehensive 285 (3 104)
income/(loss) for the year
Balances as at 29 February (7 043) 547 020
2012
Audited reconciliation of headline earnings
Continuing Total
Discontinued
operations operations operations
year ended year ended year ended
29 February 29 February 29 February
2012 2012 2012
R`000 R`000 R`000
Profit/(loss) for the year 50 918 (56 480) (5 562)
attributable to equity
holders of the company
Adjusted for:
Loss on disposal of - 41 827 41 827
business units
Remeasurement of assets - - -
held for sale
Profit on disposal of (26 045) (139) (26 184)
property, plant and
equipment
- Gross (36 087) (151) (36 238)
- Taxation 10 042 12 10 054
Impairment of property, - - -
plant and equipment
- Gross - - -
- Taxation - - -
Impairment of goodwill and - - -
other intangibles
- Gross - - -
- Taxation - - -
- Outside shareholders` - - -
interest
Headline profit/(loss) 24 873 (14 792) 10 081
attributable to equity
holders of the company
Continuing Total
Discontinued
operations operations operations
year ended year ended year ended
28 February 28 February 28 February
2011 2011 2011
R`000 R`000 R`000
Profit/(loss) for the year (228 485) (135 918) (364 403)
attributable to equity
holders of the company
Adjusted for:
Loss on disposal of - - -
business units
Remeasurement of assets - 2 487 2 487
held for sale
Profit on disposal of (8 021) (1 206) (9 227)
property, plant and
equipment
- Gross (11 140) (1 675) (12 815)
- Taxation 3 119 469 3 588
Impairment of property, 11 933 23 299 35 232
plant and equipment
- Gross 16 574 23 299 39 873
- Taxation (4 641) - (4 641)
Impairment of goodwill and 155 939 67 954 223 893
other intangibles
- Gross 187 893 67 954 255 847
- Taxation (25 791) - (25 791)
- Outside shareholders` (6 163) - (6 163)
interest
Headline profit/(loss) (68 634) (43 384) (112 018)
attributable to equity
holders of the company
Abridged segmental analysis
Reviewed Unaudited
6 months 6 months Audited
ended ended year ended
31 August 29 February 29 February
2011 2012 2012
R`000 R`000 R`000
EXTERNAL REVENUE
Continuing operations 545 847 541 656 1 087 503
Mining services - Diesel 458 563 429 978 888 541
Power
Mining services - Equipment 566 - 566
sales and rental
Total Mining Services 459 129 429 978 889 107
Civils and Earthworks 21 147 44 647 65 794
Aggregates and Quarries 65 571 67 031 132 602
Discontinued operations 130 450 54 099 184 549
Mining Services - - -
Construction Materials 130 450 54 099 184 549
676 297 595 755 1 272 052
INTER-SEGMENT REVENUE
Continuing operations 24 945 21 077 46 022
Mining services - Diesel 4 068 1 835 5 903
Power
Mining services - Equipment 19 404 13 363 32 767
sales and rental
Total Mining Services 23 472 15 198 38 670
Aggregates and Quarries 1 473 5 879 7 352
Discontinued operations 1 346 (1 346) -
Construction Materials 1 346 (1 346) -
26 291 19 731 46 022
EBITDA
Continuing operations 112 421 165 919 278 340
Mining services - Diesel 94 371 153 126 247 497
Power
Mining services - Equipment 9 140 4 648 13 788
sales and rental
Total Mining Services 103 511 157 774 261 285
Civils and Earthworks (927) 3 950 3 023
Aggregates and Quarries 9 837 4 195 14 032
Discontinued operations (4 199) (2 288) (6 487)
Mining Services - - -
Construction Materials (4 199) (2 288) (6 487)
108 222 163 631 271 853
Operating profit/(loss)
before amortisation
Continuing operations 26 230 76 243 102 473
Mining services - Diesel 19 532 73 464 92 996
Power
Mining services - Equipment 3 670 661 4 331
sales and rental
Total Mining Services 23 202 74 125 97 327
Civils and Earthworks (927) 3 950 3 023
Aggregates and Quarries 3 955 (1 832) 2 123
Discontinued operations (8 312) (4 092) (12 404)
Mining Services - - -
Construction Materials (8 312) (4 092) (12 404)
17 918 72 151 90 069
Impairment losses
Continuing operations - - -
Mining services - Diesel - - -
Power
Aggregates and Quarries - - -
Discontinued operations - - -
Mining Services - - -
Construction Materials - - -
- - -
Profit/(loss) before
interest and taxation
("PBIT")
Continuing operations 23 276 73 289 96 565
Mining services - Diesel 19 532 73 464 92 996
Power
Mining services - Equipment 3 670 661 4 331
sales and rental
Total Mining Services 23 202 74 125 97 327
Civils and Earthworks (927) 3 950 3 023
Aggregates and Quarries 1 001 (4 786) (3 785)
Discontinued operations (14 264) (39 967) (54 231)
Mining Services - - -
Construction Materials (14 264) (39 967) (54 231)
9 012 33 322 42 334
Reviewed Unaudited
6 months 6 months Audited
ended ended year ended
31 August 28 February 28 February
2010 2011 2011
R`000 R`000 R`000
EXTERNAL REVENUE
Continuing operations 585 459 442 974 1 028 433
Mining services - Diesel 418 520 336 744 755 264
Power
Mining services - Equipment 40 117 44 631 84 748
sales and rental
Total Mining Services 458 637 381 375 840 012
Civils and Earthworks 51 598 18 149 69 747
Aggregates and Quarries 75 224 43 450 118 674
Discontinued operations 195 562 145 219 340 781
Mining Services 69 669 - 69 669
Construction Materials 125 893 145 219 271 112
781 021 588 193 1 369 214
INTER-SEGMENT REVENUE
Continuing operations 2 085 19 530 21 615
Mining services - Diesel 737 342 1 079
Power
Mining services - Equipment 1 348 18 231 19 579
sales and rental
Total Mining Services 2 085 18 573 20 658
Aggregates and Quarries - 957 957
Discontinued operations - - -
Construction Materials - - -
2 085 19 530 21 615
EBITDA
Continuing operations 47 838 80 135 127 973
Mining services - Diesel 40 282 38 221 78 503
Power
Mining services - Equipment - 36 068 36 068
sales and rental
Total Mining Services 40 282 74 289 114 571
Civils and Earthworks (5 441) (1 820) (7 261)
Aggregates and Quarries 12 997 7 666 20 663
Discontinued operations 8 221 (3 493) 4 728
Mining Services 15 678 - 15 678
Construction Materials (7 457) (3 493) (10 950)
56 059 76 642 132 701
Operating profit/(loss)
before amortisation
Continuing operations (33 028) (10 232) (43 260)
Mining services - Diesel (33 949) (22 882) (56 831)
Power
Mining services - Equipment - 13 595 13 595
sales and rental
Total Mining Services (33 949) (9 287) (43 236)
Civils and Earthworks (5 441) (1 820) (7 261)
Aggregates and Quarries 6 362 875 7 237
Discontinued operations (22 100) (8 634) (30 734)
Mining Services (9 529) - (9 529)
Construction Materials (12 571) (8 634) (21 205)
(55 128) (18 866) (73 994)
Impairment losses
Continuing operations (204 467) - (204 467)
Mining services - Diesel (140 522) - (140 522)
Power
Aggregates and Quarries (63 945) - (63 945)
Discontinued operations (89 267) (1 986) (91 253)
Mining Services (21 313) - (21 313)
Construction Materials (67 954) (1 986) (69 940)
(293 734) (1 986) (295 720)
Profit/(loss) before
interest and taxation
("PBIT")
Continuing operations (245 840) (13 185) (259 025)
Mining services - Diesel (179 019) (22 884) (201 903)
Power
Mining services - Equipment - 13 595 13 595
sales and rental
Total Mining Services (179 019) (9 289) (188 308)
Civils and Earthworks (5 441) (1 820) (7 261)
Aggregates and Quarries (61 380) (2 076) (63 456)
Discontinued operations (111 367) (10 620) (121 987)
Mining Services (30 842) - (30 842)
Construction Materials (80 525) (10 620) (91 145)
(357 207) (23 805) (381 012)
Introduction
During the period under review, the company stabilised and achieved many of
its stated objectives resulting in a considerable improvement in the financial
and operational performance of the group. The group`s flagship operation,
Diesel Power, performed particularly well. Buildmax`s continuing operations
turned around from an after tax loss of R235,8 million in the 2011 financial
year to an after tax profit of R51,2 million in the 2012 financial year. The
group successfully disposed of all the Construction Materials businesses that
were classified at half-year as discontinued operations. Extensive effort went
into re-organising these businesses to enable Buildmax to dispose of them.
This capped the group`s exposure relating to these businesses and resulted in
a final after tax loss of R56,5 million. This was an improvement from the
after tax loss of R135,9 million recorded for the 2011 financial year.
The group`s continuing business units (viz. Mining Services, Civils and
Earthworks and Quarries), are all profitable, cash positive and supported by a
secure and dedicated management team and workforce. The group`s business model
is on a solid footing with numerous prospects emanating from Buildmax`s
existing blue chip customers.
There are excellent growth prospects in the mining sector. As a result of the
improved financial position of the group, Buildmax now has debt to equity and
debt to EBITDA ratios that enable it to replace plant when appropriate and
take advantage of growth opportunities supported by our bankers. Above all,
Buildmax`s management are firmly of the view that there are further
opportunities to reduce costs, improve efficiencies and effectively manage
risk.
One of the most important focus areas has been to employ better qualified
technical staff and to introduce modern maintenance facilities and
preventative maintenance systems. This, in conjunction with the development of
information and internal control systems and training, will benefit the group
in years to come.
The results of the continuing businesses include the effects, both positive
and negative, of the resolution of difficult legal and contractual situations
which arose in previous years.
In comparison to February 2011 the results from continuing operations are
summarised as follows:
- Revenue increased by 5,74% to R1 087,5 million;
- Operating profit improved from a loss of R43,3 million to a profit of R102,5
million; and
- EBITDA improved significantly by 117,5% to R278,3 million.
Including the negative impact associated with the disposal of the discontinued
operations, the group as a whole:
- Improved its loss per share from 14,31 cents to a loss per share of 0,16
cents;
- Reported headline earnings of R10,0 million compared to a headline loss of
R112,0 million at February 2011;
- Spent R415,9 million on capex to expand and maintain operations which was
funded by cash and asset based finance facilities;
- Increased its interest-bearing debt from R276,7 million at February 2011 to
R324,4 million;
- Slightly reduced its net cash position from R117,8 million at the end of the
2011 financial year to R108,8 million mainly as a result of capital
expenditure of R114,6 million funded from own cash resources; and
- Shareholders` funds decreased marginally from R547,0 million at the end of
February 2011 to R541,9 million at the end of February 2012.
World-class safety standards maintained
The group remains fully committed to zero harm production in the workplace.
During the period under review, no fatalities or serious injuries were
recorded at any of the group`s operations. Various systems and processes are
in place to ensure that all workplaces are safe and that SHECQ systems are
implemented and monitored. Safety awareness is a priority and is encouraged
and communicated to all levels of employees.
The group`s Mining and Quarrying businesses achieved a lost time injury
frequency rate of 0,15 for the period under review. This equates to nine minor
injuries during the period - an excellent achievement compared to industry
standards.
OPERATIONAL REVIEW
Continuing operations
Mining Services - Diesel Power
Revenue for this business unit increased by 17,65% to R888,5 million as a
result of improved contract rates and increased plant availability and
efficiency.
EBITDA increased by 215,27% to R247,5 million from R78,5 million as of
February 2011. The business unit spent R372,9 million on gross capex during
the same period.
Mining Services - Equipment sales and rental
This business unit generated most of its current revenue from short-term plant
rentals to Diesel Power at market related rates. External plant rental revenue
for the period under review was not significant. During the comparative
period, the business unit rented most of its plant items to an external
customer which acquired certain of the equipment at the end of the rental
period.
The division`s EBITDA for the period under review was R13,8 million and it
reported an operating profit of R4,3 million.
The business unit spent R21,9 million on gross capex in the period under
review.
Civils and Earthworks
This business unit generates its revenue by providing civil and bulk earth
moving services to the mining sector and property developers. Whilst revenue
for the period decreased to R65,8 million from R69,7 million, the EBITDA and
profit before interest and tax improved from a loss of R7,3 million to a
profit of R3,0 million.
The business unit spent R9,8 million on gross capex for the period under
review.
Aggregates and Quarries
Due to the lack of new infrastructure projects in the current weak
construction market, the group`s quarry operations remain largely dependent on
short-term construction contracts. Revenue from the group`s quarrying
businesses increased by 11,74% to R132,6 million compared to the previous
financial period.
EBITDA margins reduced from 17,41% in the previous financial period to 10,58%,
due to stronger competition in the business unit`s target markets and its
inability to pass on all operating cost increases to its customers.
The business unit reported a loss before interest and taxation of R3,8 million
compared to a loss of R63,5 million for the comparative period that included
non-cash flow pre-tax impairments of R63,9 million on goodwill, intangible
assets and equipment.
Gross capex for the period amounted to R8,9 million compared to R4,5 million
during the comparative period.
Discontinued operations
Mining Services
During the comparative period, the financial results of Vukuza Earth Works
(Pty) Limited ("Vukuza"), a subsidiary in the Mining Services business unit,
was disclosed as discontinued operations subsequent to a decision taken by
management to close Vukuza`s mining operations and terminate all loss making
opencast mining contracts. The controlled wind-down of this entity was
completed during the previous financial year and accordingly no financial
results have been reported for the current year.
Construction Materials
In line with the group`s stated strategic decision to focus on its core
business activity, the board approved the disposal of the entities in the
Construction Materials Business Unit. The board is pleased to report that all
the manufacturing companies were disposed of during the period under review.
The group`s statement of comprehensive income reflects the trading losses of
these entities up to the effective date of sale and the net loss of R41,8
million incurred due to the disposal. Of the aggregate purchase consideration
of R21,5 million, R4,5 million was received in cash and the balance of R17
million was structured as loan obligations repayable over a maximum period of
48 months, secured primarily by cession of the shares sold.
Our people
It is important to the group that our staff are healthy and cared for. The
group`s Wellness Programme aims to identify risks, provide wellness education
and influence positive behaviour change amongst our employees. The educational
component of our Wellness Programme encourages employees to live healthier
lifestyles.
There has been a gradual improvement in the group`s ability to attract key
management at all levels and operational staff, including female operators.
The group, however, is still experiencing challenges in attracting and
retaining staff on the technical side due to the global shortage of skills.
The group has embarked on robust apprenticeship training as well as working
with universities, technical institutions and other players in this space to
ensure steps are taken to address this challenge.
Committed to transformation
The group`s BEE shareholding has significantly reduced from 17% in March 2008
to 6,75%, largely due to dilution as a result of the share issue during 2009
and the rights issue in November 2010.
An independent firm of consultants has been appointed to assist the group to
strengthen the company`s current BEE status.
The Transformation Committee has formulated a four-year plan to improve the
group`s rating from a Level 6 to a Level 4 contributor. In addition a strategy
to meet the requirements of the Mining Charter has been implemented.
Outlook
Mining Services is expected to drive prospects for the next year.
Whilst global markets remain volatile, coal remains one of the cheapest
sources of energy available and its abundant reserves compared to other fossil
fuels renders it likely to remain the primary source of energy for the
foreseeable future.
Eskom has reduced its projected demand for coal over the medium-term, and has
announced its intention to introduce alternative energy sources, the continued
roll-out of coal fired power stations coupled with international demand for
thermal and coking coal, particularly from China and India, should ensure
continued growth in this sector for the foreseeable future. Although the
growth in coal exports is currently hampered by bottlenecks in the current
rail network, Transnet recently announced its intention to increase the
capacity of the rail network to cope with the demand for coal from China and
India.
We have meaningful contractual relationships with some of the leading mining
groups in the country and our aim is to grow these relationships for the
mutual benefit of both parties as the propensity to outsource by mining houses
continues to grow. Mining Services is therefore well-positioned to reduce its
geographic and commodity concentration, respond to market volatility and
participate on a wider basis in the open cast mining and general mining supply
chain, focussing on activities that are less capital intensive.
Dividend
No final dividend has been declared. It is the group`s policy to consider the
declaration of a dividend annually.
Conclusion
We would like to thank the Board, employees and stakeholders for their
dedication and support in successfully turning the group around.
Colin Wood
Independent Non-Executive Chairman
Terry Bantock
CEO
Christie Els
CFO
24 May 2012
NOTES TO THE AUDITED CONSOLIDATED ANNUAL RESULTS
Basis of preparation and accounting policies
The audited abridged consolidated financial statements for the year ended 29
February 2012 have been prepared in compliance with International Financial
Reporting Standards ("IFRS") specifically IAS 34 Interim Financial Reporting,
the AC 500 series of interpretations as issued by the Accounting Practices
Board, the South African Companies Act, 71 of 2008 and the Listings
Requirements of the JSE Limited.
Except for the adoption of new and revised accounting standards which became
effective during the financial year, the principle accounting policies applied
by the group in the audited abridged consolidated financial statements for the
year ended 29 February 2012 are consistent with those applied in the audited
consolidated financial statements for the year ended 28 February 2011. These
statements have been compiled under the supervision of the Chief Financial
Officer, Christie Els CA(SA).
The audited abridged consolidated financial statements and the unqualified
audit report of the external auditors, PKF (Jhb) Inc., is available for
inspection at the registered office of the company.
Estimates and contingencies
Management makes estimates and judgements concerning the future with regards
to opencast mining contracts, remaining life of quarries, future
rehabilitation costs, provisions, claims, depreciation methods and residual
values when estimating the recoverable amounts of assets.
The resulting estimates and judgements can only approximate the actual
results. Estimates and judgements 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.
Segmental reporting
Management, in consultation with the Board, decided to expand the group`s
segmental reporting to include the Civils and Earthworks business unit that
was previously reported on as part of the Mining Services business unit. This
change became effective in March 2011 and the segmented financial results for
the comparative period have been restated.
Discontinued operations
In line with the overall group strategy the group has disposed of its entire
shareholding in the following entities that constituted the Construction
Materials Business Unit:
Effective date
Watertite Guttering (Pty) Limited ("Watertite") 1 March 2011
Benoni Sand and Buildware (Pty) Limited ("BSB") 31 August 2011
Buildmax Industries (Pty) Limited ("BMI") 30 November 2011
Columbia DBL (Pty) Limited ("Columbia") 30 November 2011
Cast Industries (Pty) Limited ("Cast") 31 January 2012
The group`s statement of comprehensive income reflects the financial results
of these entities up to the effective date of sale and the net loss incurred
due to the disposal of these businesses.
Contingencies
The group has contingent liabilities in respect of legal claims arising in the
ordinary course of business. It is not anticipated that any material
liabilities will arise from the contingent liabilities other than those
provided for.
Directors: C Wood (Chairman)*; TP Bantock (Chief Executive Officer); CS Els
(Chief Financial Officer); CB Brayshaw*;
MD Lamola*; DJ Mack*; MW McCulloch*; BT Ngcuka*; G Montgomery*
(*Non-executive director, Independent)
Registered office: 514 Pretoria Road, Fairleads, Benoni (Postnet Suite 435,
Private Bag X108, Centurion, 0046)
Sponsor: QuestCo (Pty) Limited, 2nd Floor, No 1 Montecasino Blvd, Fourways,
2055, South Africa
(PO Box 98956, Sloane Park, 2152, South Africa)
Auditors: PKF (Jhb) Inc., 42 Wierda Road West, Wierda Valley, Sandton, 2196
Transfer secretaries: Computershare Investor Services (Pty) Limited, 70
Marshall Street, Johannesburg, 2001
(PO Box 61763, Marshalltown, 2107)
Company secretary: Probity Business Services (Pty) Limited
www.buildmax.co.za
Date: 24/05/2012 16:42:01 Supplied by www.sharenet.co.za
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