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MCU - m Cubed Holdings Limited - Condensed audited group financial statements
for the year ended 29 February 2012 and notice of Annual General Meeting
m Cubed Holdings Limited
Incorporated in the Republic of South Africa
Registration number: 1998/014568/06
Share code: MCU ISIN:ZAE000033353
("m Cubed" or "the company" or "the group")
CONDENSED AUDITED GROUP FINANCIAL STATEMENTS FOR THE YEAR ENDED 29 FEBRUARY 2012
AND NOTICE OF ANNUAL GENERAL MEETING
Shareholders are hereby advised that the Annual Report of m Cubed for the year
ended 29 February 2012 will be posted to shareholders on or before 30 June 2012.
This report contains the condensed audited group financial statements for the
year ended 29 February 2012.
Part A: Condensed audited financial statements
1.Condensed group statement of financial position
Audited Audited
Group Group
2012 2011
ASSETS R`000 R`000
Non-current assets
Property, plant and equipment 599 -
Financial assets at fair value through 23,708 11,000
profit and loss
Deferred tax 778 -
25,085 11,000
Current assets 30,552 -
Other financial assets
Loans and receivables 7,244 10,172
Current taxation 856 3,091
Cash and cash equivalents 12,696 57,907
51,348 71,170
Total assets 76,433 82,170
EQUITY
Equity attributable to the owners of the
company
Ordinary shares 7,385 7,385
Share premium 87,668 87,668
Accumulated loss (28,751)
(21,342)
Total equity 73,711 66,302
LIABILITIES 857 -
Non Current liability
Deferred tax
857 -
Current liabilities
Provisions 283 8,809
Trade and other payables 1,566 7,039
Current taxation 16 20
1,865 15,868
Total liabilities 2,722 15,868
Total equity and liabilities 76,433 82,170
2.Condensed group statement of comprehensive income
Audited Audited
Group Group
2012 2011
R`000 R`000
Investment income 13,443 11,813
Other income 9,873
2,780
Total Income 23,316 14,593
Operating expenses (12,671)
(17,634)
Impairment of loans (2,450) -
Total Expenses (15,121)
(17,634)
Profit/(Loss) of operations 8,195 (3,041)
Interest expense (60) -
Profit/(Loss) before tax 8,135
(3,041)
Income tax expense (727) (2,732)
Profit/(Loss) for the year 7,408
(5,773)
Other comprehensive loss
Currency translation differences - (2,353)
Total comprehensive profit/(loss) for the 7,408
year, net of tax (8,126)
Profit/(Loss) for the year attributable to:
Equity holders of the company 7,408
(5,773)
Total comprehensive profit/(loss) for the 7,408
year attributable to: (8,126)
Equity holders of the company
Number of shares in issue (`000) 738 537 738 537
Diluted number of shares in issue (`000) 738 537 738 537
Headline and diluted headline earnings/(loss) 1.00 (0.8)
per share (cents)
Earnings and diluted earnings/(loss) per share 1.00 (0.8)
(cents)
Net asset value per share (cents) 9.98 9.0
Net tangible asset value per share (cents) 9.98 9.0
3. Condensed group statement of changes in equity
2012 audited Share Share Foreign Accumulated Total
capital premium currency (losses)
translation
reserve
R`000 R`000 R`000 R`000 R`000
Group
Balance at 1 March 7,385 87,668 - (28,750) 66,303
2011
Total comprehensive - - - 7,408 7,408
income for the year
Balance at 29 7,385 87,668 - (21,342) 73,711
February 2012
2011 audited Share Share Foreign Total
capital premium currency Accumulated
translation (losses)
reserve
R`000 R`000 R`000 R`000 R`000
Group
Balance at 1 March 7,385 227,990 2,353 (22,977) 214,751
2010
Total comprehensive - - (2,353)
income for the year (5,773) (8,126)
Dividend paid - (140,322) - -
(140,322)
Balance at 28 7,385 87,668 - (28,750) 66,303
February 2011
4.Condensed group cash flow statement
Audited
Group Audited
Group
2012 2011
R`000 R`000
Cash flows from operating activities
Payments to shareholders - (140,322)
Other movements (8,008) 102,208
Net cash from operating activities (8,008) (38,114)
Cash flows from investing activities
Increase in financial assets (36,542) (12,708)
Other movements (661) -
Net cash from investing activities (37,203) (12,708)
(50,822)
Net decrease in cash and cash equivalents (45,211)
57,907 108,729
Cash and cash equivalents at the beginning
of the year
12,696 57,907
Cash and cash equivalents at the end of the
year
5.Segmental results
Consistent to prior year, no segmental information is provided as the group only
had one segment that traded and the board believes that there is no additional
information to be disclosed.
6. Reconciliation of headline earnings/ (loss)
Audited Audited
Group Group
2012 2011
R`000 R`000
Basic earnings/(loss)
7,408 (5,773)
Profit on disposable of fixed assets 18
Headline earnings/(loss) attributable to
shareholders 7,426 (5,773)
Part B: Notes and directors` comments
1.Basis of preparation
The condensed group financial information has been prepared in
accordance with IAS 34 - Interim Financial Reporting and is based on the
audited financial statements of the Group for the year ended 29 February 2012,
which have been prepared in accordance with International Financial Reporting
Standards ("IFRS"), the AC 500 series of interpretations, the Listings
Requirements of the JSE Limited and the Companies Act of South Africa. The
condensed financial statements have been audited by the Group`s independent
auditor, PKF (Cpt) Inc., whose report is available for inspection at the
registered office of the Company. The auditors PKF (Cpt) Inc. have issued an
unqualified audit opinion with a report on other regulatory matters that details
non-compliance with certain JSE Listing requirements. m Cubed has entered into
certain category 1 transactions without receiving prior shareholder approval,
however irrevocable support has been obtained from the majority of shareholders
for all the proposed transactions as announced on SENS dated 21 December 2011
and 26 April 2012 and are subject to JSE approval.
The audited group financial results for the year ended 29 February 2012 have
been prepared in accordance with the group accounting policies and are
consistent with those applied in the previous financial year. The group annual
financial statements were prepared by GW Geyer, CAP Chartered Accountants.
2.Composition of management
Quinton George has been appointed as the CEO, James Fitzpatrick as an Executive
Director and Stephen Black as the Financial Director. The board is pleased with
the progress they have made in driving the vision of building m Cubed into a
reputable investment holding company.
3.Nature of business, review of operations and prospects
The JSE has formally informed the Company that it is deemed to be a cash shell
as defined in terms of the Listings Requirements and that the company had until
the 31 December 2011 to make an announcement relating to the acquisition of
viable assets that satisfy the conditions for listing as set out in section 4 of
the Listings Requirements. The company duly released an announcement on 21
December 2011 together with a supplementary announcement on 26 April 2012
recording the acquisition of viable assets, subject to shareholder ratification
and/or approval and advising shareholders of the company`s intention to make
application to the JSE for the lifting of the suspension of the company`s
listing, the unbundling of the shares in its wholly owned subsidiary, Trinity
Investments Holdings Limited ("TIH") to shareholders, followed by the mirror
listing of TIH and the delisting of m Cubed. The lifting of the suspension,
subsequent mirror listing of TIH and delisting of m Cubed as aforesaid is
subject to JSE approval. Full details of the aforementioned corporate
transactions shall be disclosed in a detailed circular to shareholders.
Contingent liabilities, legal cases and provisions.
At year-end, after consulting with our legal advisors, it was considered
appropriate to reverse substantially all legal provisions. These reversals are
included in other income.
The reason for this is that the outstanding matters with the regulator, various
disputes and legal cases in the group have mostly been resolved. The notable
exception to this is m Cubed Specialised Lending which has outstanding balances
with an offshore trust, pending a SARS legal dispute. All outstanding matters
are dealt with in the annual report.
Financial assets
m Cubed increased its holdings in Convergenet Holdings Limited ("Convergenet")
during the year from 6.0% to 10.3%. Details of this were announced on SENS dated
21 December 2011 and 26 April 2012.
The remaining financial assets consist of secured loans and refundable deposits
made by m Cubed during the year. The repayment terms range from six to twelve
months from year end and interest range from money market rates to prime plus
5%.
Based on valuations performed on the loans, the directors decided to pass an
impairment expense adjustment of R2 430 000.
All outstanding matters are dealt with in the annual report.
4.Corporate governance
The board of directors of m Cubed continue to subscribe to the values of good
corporate governance as set out in the King Report on Governance for South
Africa 2009("King III") apart from the instances which will be set out in the
annual report. They believe the departure in these areas are not an indication
of a culture of non-compliance, but have determined that the cost involved
doesn`t justify complying with all the requirements in a company that is
considered a cash shell. Detailed explanations regarding non-compliance of King
III will be provided in the annual report.
5. Events subsequent to year-end
Subsequent to year-end the following events have occurred:
The Toico (Proprietary) Limited loan of R6 696 000 has gone into default and the
company has decided to take possession of the security of R7 000 000.
The Zilvermijnbosch Estate Holdings (Proprietary) Limited loan of R11 130 000 is
currently in default & a possible settlement is being negotiated, with an option
to extend the repayment date. The security on this loan is in the process of
also being re-negotiated. At year-end the directors re-valued the securities to
determine the recoverability of the loan.
m Cubed Holdings Limited has entered into a share sale agreement to acquire 87
Yellow Star shares, equal to 34.66% of the issued share capital of Yellow Star
(Proprietary) Limited. Yellow Star is a private investment holding company and
its largest investment is an interest in Convergenet. This acquisition will
bring m Cubed`s effective interest in Convergenet to 19.81%. Details of the
acquisition were announced on SENS dated 26 April 2012.
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given that the Annual General Meeting of m Cubed will be held
at Block F, The Terraces, Steenberg Office Park, Tokai, Cape Town on Tuesday 21
August 2012 at 11h00, to transact the business as stated in the notice of the
Annual General Meeting, which is included as part of the Annual Report that will
be distributed to shareholders on or before 30 June 2012. The date on which
shareholders must be recorded as such in the share register to be eligible to
vote at the Annual General Meeting will be Friday, 10 August 2012 with the last
day to trade being Thursday 2 August 2012,
Cape Town
31 May 2012
Registered office:
Afrasia House, Block F
The Terraces
1 Silverwood close
Steenberg
Tokai
Business address
Afrasia House, Block F
The Terraces
1 Silverwood close
Steenberg
Tokai
Postal address
Afrasia House, Block F
The Terraces
1 Silverwood close
Steenberg
Tokai
Directors
AM Louw* (Chairman), W Roux*, Q George (CEO), SJ Black (FD), J Fitzpatrick, S
Swana*, J Ramsey*
*Non-executive
Bankers
The Standard Bank of South Africa Limited
Auditors
PKF (Cpt) Inc.
Secretary
RGF Turner
Company registration number
1998/014568/06
JSE sponsor
PSG Capital (Proprietary) Limited
Date: 31/05/2012 17:33:01 Supplied by www.sharenet.co.za
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