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Unaudited interim results for the six months ended 30 June 2012 and declaration of cash dividend
TRENCOR LIMITED
INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA
REG NO 1955/002869/06
SHARE CODE: TRE
ISIN: ZAE000007506
('Trencor')
Unaudited interim results
for the six months ended 30 June 2012
and declaration of cash dividend
COMMENTARY
GROUP
- Trading profit, which is earned mainly in US dollars, after net financing costs, increased by 2%
from R763 million in 2011 to R777 million during the period under review. Excluding the non-cash
gain realised on the sale of containers last year by Textainer following the restructuring of TMCL (see below),
the increase was 23,5% from R629 million in 2011 to R777 million (in dollar terms this increased by 5,7%).
- Headline earnings per share (including the effect of realised and unrealised foreign exchange
translation gains and losses and gains on the sale of containers referred to above) were
262,3 cents (2011: 219,3 cents), an increase of 19,6%.
- Adjusted headline earnings per share (which excludes the effect of net unrealised foreign
exchange translation gains and losses but includes gains on the sale of containers referred to
above) were 256,7 cents (2011: 209,7 cents), an increase of 22,4%.
- These various earnings are better presented in tabular form:
Year ended
6 months ended 30 June 31 December
2012 2011 2011
Cents per Cents per Cents per
share share share
Headline earnings including gains
on containers sold pursuant to TMCL
restructuring in 2011 (32,9 cents per
share) 262,3 219,3 559,8
Deduct: Unrealised foreign exchange
translation gains 5,6 9,6 76,9
Adjusted headline earnings 256,7 209,7 482,9
- Based on the spot exchange rate of US$1 = R8,24 and the price of Textainer's shares listed
on the NYSE on 29 June 2012 (US$36,90), the net asset value of Trencor at that date was as
follows:
R million R per share
Net interest in Textainer 9 054,4 51,15
Net interest in long-term receivables 722,6 4,08
Cash 795,9 4,49
Net liabilities (mainly deferred tax) (159,1) (0,90)
10 413,8 58,82
- Consolidated gearing ratio at 30 June 2012 was 178% (2011: 169%).
- Interim dividend of 65 cents per share declared (2011: 50 cents per share).
TEXTAINER (60,09% beneficiary interest)
- Net profit for the half year in US GAAP was US$95,7 million (2011: US$88,9 million).
Adjusted to conform with International Financial Reporting Standards, Textainer's net profit
was US$97,3 million (2011: US$92,1 million). Amounts in 2011 included a non-cash gain of
US$14,8 million arising on the sale of containers to the prior non-controlling interest as a
result of restructuring the company's primary asset-owning subsidiary Textainer Marine Containers Ltd ("TMCL").
- Fleet utilisation at 30 June 2012 was 98,1% (2011: 99,0%).
- Textainer invested more than US$760 million in new and used containers as well as purchases
from its managed fleet since the beginning of the year. Approximately 25% of the new container
purchases were in refrigerated containers as the company continues to expand market share in
the refrigerated container market.
- Total fleet under management at 30 June 2012 was 2 615 000 (2011: 2 442 000) twenty foot
equivalent units of which Textainer itself owned 60,4% (2011: 57,3%). 80% of the fleet is
committed to long-term operating, financing and sales-type leases, compared to 78% a year
ago.
- In April 2012, one of Textainer's subsidiaries issued US$400 million 10-year, container-backed
notes at a fixed interest rate, payable monthly, of 4,21% p.a. Textainer also restructured its
securitisation facility, increasing its size from US$850 million to US$1,2 billion. The interest rate
on the new facility is 2,625% over one-month LIBOR during the initial two-year revolving period.
- Textainer declared dividends of US$0,40 and US$0,42 per share in respect of quarters 1 and 2
of 2012 respectively.
- Textainer's results may be viewed on its website www.textainer.com.
PREPARATION OF FINANCIAL STATEMENTS
These unaudited interim condensed consolidated financial statements have been prepared
by management under the supervision of the Financial Director and have not been audited or
reviewed by Trencor's independent auditors.
DECLARATION OF CASH DIVIDEND
The board has declared an interim cash dividend (number 93) of 65 cents per share out of
distributable reserves in respect of the six months ended 30 June 2012.
The salient dates pertaining to the dividend payment are as follows:
Last day to trade cum the dividend Friday, 7 September 2012
Trading commences ex the dividend Monday, 10 September 2012
Record date Friday, 14 September 2012
Payment date Monday, 17 September 2012
Share certificates may not be dematerialised or rematerialised between Monday, 10 September
2012 and Friday, 14 September 2012, both days inclusive.
Note that:
- As no secondary tax on companies' credits are available, dividend withholding tax at the rate of 15% will be
applicable to shareholders who are not exempt, which will result in a net dividend of 55,25000 cents per share;
- Trencor's tax reference number is 9676002711; and
- Trencor's issued share capital at the declaration date is R885 340 (177 068 011 ordinary shares
of 0,5 cent each).
On behalf of the board
NI Jowell Chairman
15 August 2012
Directors:
NI Jowell* (Chairman), JE Hoelter (USA), C Jowell*, JE McQueen* (Financial), DM Nurek,
E Oblowitz, RJA Sparks, HR van der Merwe*, H Wessels (* executive)
Secretaries: Trencor Services (Pty) Ltd
Registered Office: 1313 Main Tower, Standard Bank Centre, Heerengracht, Cape Town 8001
Transfer Secretaries: Computershare Investor Services (Pty) Ltd, 70 Marshall Street, Johannesburg
2001 (PO Box 61051, Marshalltown 2107)
Sponsor: Rand Merchant Bank (A division of FirstRand Bank Ltd)
www.trencor.net
Condensed consolidated statement of financial position
at 30 June 2012
Unaudited Unaudited Audited
30 June 30 June 31 December
2012 2011 2011
R Million
ASSETS
Property, plant and equipment 19 120 12 517 15 600
Intangible assets 361 335 380
Investment in equity accounted investee 16 3
Investments 14 14 14
Long-term receivables 678 796 756
Net investment in finance leases 474 343 444
Derivative financial instruments 3
Deferred tax assets 20 67 22
Restricted cash 376 243 370
Total non-current assets 21 059 14 318 17 589
Inventories 200 34 169
Trade and other receivables 820 586 773
Current portion of long-term receivables 256 143 285
Current portion of net investment in finance leases 168 139 167
Current tax assets 2 2
Cash and cash equivalents 1 468 1 020 1 333
Current assets 2 912 1 924 2 729
Total assets 23 971 16 242 20 318
EQUITY
Share capital and premium 44 40 44
Reserves 5 069 3 621 4 750
Equity attributable to equity holders of the company 5 113 3 661 4 794
Non-controlling interest 2 493 1 650 2 188
Total equity 7 606 5 311 6 982
LIABILITIES
Interest-bearing borrowings 11 453 8 364 11 031
Amounts attributable to third parties in respect of long-term receivables 158 214 173
Derivative financial instruments 114 100 131
Deferred revenue 1 11 9
Deferred tax liabilities 208 210 224
Total non-current liabilities 11 934 8 899 11 568
Trade and other payables 2 158 1 257 510
Current tax liabilities 103 76 78
Current portion of interest-bearing borrowings 2 101 619 1 076
Current portion of amounts attributable to third parties in respect of long-term receivables 48 23 53
Current portion of deferred revenue 21 57 51
Current liabilities 4 431 2 032 1 768
Total liabilities 16 365 10 931 13 336
Total equity and liabilities 23 971 16 242 20 318
Capital expenditure incurred during the period 3 875 3 989 5 396
Capital expenditure committed and authorised, but not yet incurred 1 503 129 277
Directors' valuation of other unlisted investments 14 14 14
Ratio to total equity:
Total liabilities (%) 215,2 205,8 191,0
Interest-bearing debt (%) 178,2 169,1 173,4
Condensed consolidated statement of cash flows
for the six months ended 30 June 2012
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 June 30 June 31 December
2012 2011 2011
R Million
Cash generated from operations 1 521 1 206 2 485
Increase in container leasing equipment (2 229) (3 741) (5 912)
Finance income received 6 2 5
Finance expenses paid (241) (125) (335)
Dividends paid to equity holders of the company (221) (177) (265)
Dividends paid to non-controlling interest (121) (80) (187)
Income tax paid (27) (41) (43)
Net cash outflow from operating activities (1 312) (2 956) (4 252)
Cash inflow from investing activities 97 189 236
Cash inflow from financing activities 1 334 2 719 4 075
Net increase/(decrease) in cash and cash equivalents before exchange rate fluctuations 119 (48) 59
Net cash and cash equivalents at the beginning of the period 1 333 1 029 1 029
Effects of exchange rate fluctuations on cash and cash equivalents 16 39 245
Net cash and cash equivalents at the end of the period 1 468 1 020 1 333
Condensed consolidated statement of comprehensive income
for the six months ended 30 June 2012
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 June 30 June 31 December
2012 2011 2011
R Million
Revenue (Note 2) 2 138 2 430 4 649
Trading profit before items listed below 1 043 925 1 944
Realised and unrealised exchange gains on translation of long-term receivables, excluding
fair value adjustment 18 32 276
Net long-term receivable fair value adjustment 30 6 (40)
Impairment of plant and equipment (3) (5) (18)
Profit from operations 1 088 958 2 162
Net finance (expenses)/income (Note 3) (266) (162) (415)
Finance expenses Interest expense (250) (112) (315)
Losses on derivative financial instruments (22) (52) (105)
Finance income Interest income 6 2 5
Loss from equity accounted investee (net of tax) (1) (2)
Profit before tax 821 796 1 745
Income tax expense (53) (52) (100)
Profit for the period 768 744 1 645
Other comprehensive income
Foreign currency translation differences 111 137 1 120
Total comprehensive income for the period 879 881 2 765
Total comprehensive income for the period attributable to:
Equity holders of the company 529 485 1 720
Non-controlling interest 350 396 1 045
879 881 2 765
Profit attributable to:
Equity holders of the company 463 394 991
Non-controlling interest 305 350 654
768 744 1 645
Basic earnings per share (cents) 261,5 217,9 554,3
Diluted earnings per share (cents) 261,5 217,3 554,3
Number of shares in issue (million) 177,1 176,7 177,1
Weighted average number of shares in issue (million) 177,1 181,0 178,8
Period-end rate of exchange: SA rand to US dollar 8,24 6,76 8,12
Average rate of exchange for the period: SA rand to US dollar 7,89 6,84 7,20
Condensed consolidated statement of changes in equity
for the six months ended 30 June 2012
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 June 30 June 31 December
2012 2011 2011
R Million
Balance at the beginning of the period 4 794 3 895 3 895
Total comprehensive income for the period 529 485 1 720
Profit for the period 463 394 991
Foreign currency translation differences 66 91 729
Dividends paid (221) (177) (265)
Share-based payments 35 27 42
Changes in ownership interests in subsidiary (24) (8) (8)
Repurchase of own shares from owners (417) (417)
Share options exercised 5
Acquisition of non-controlling interest without a change in control (144) (178)
Shareholders' interest 5 113 3 661 4 794
Non-controlling interest in subsidiaries 2 493 1 650 2 188
Balance at the beginning of the period 2 188 2 056 2 056
Total comprehensive income for the period 350 396 1 045
Profit for the period 305 350 654
Foreign currency translation differences 45 46 391
Dividends paid to non-controlling interest (121) (86) (187)
Share-based payments 23 16 25
Shares issued by subsidiary 29 39 42
Acquisition of non-controlling interest without a change in control (779) (801)
Changes in ownership interests in subsidiary 24 8 8
Equity 7 606 5 311 6 982
Notes to the condensed consolidated annual financial statements
for the six months ended 30 June 2012
1. These condensed consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards
(IFRS) including IAS 34 Interim Financial Reporting, South African Statements and Interpretations of Statements of Generally Accepted
Accounting Practice (AC 500 Series), the Companies Act of South Africa and the JSE Listings Requirements. The accounting policies applied in
the preparation of these consolidated condensed financial statements are consistent with those used in the annual financial statements for the
year ended 31 December 2011.
Unaudited Unaudited Audited
6 months 6 months year
ended ended ended
30 June 30 June 31 December
2012 2011 2011
R Million
2. Revenue
Goods sold and services rendered 580 1 213* 1 765*
Leasing income 1 420 1 070 2 378
Management fees 114 105 212
Finance income 6 10 18
2 120 2 398 4 373
Realised and unrealised exchange differences 18 32 276
2 138 2 430 4 649
* Includes R899 million in respect of containers sold to non-controlling interests.
3. Net finance expenses/(income)
Finance expenses 272 164 420
Interest expense Textainer 250 112 315
Losses on derivative financial instruments 22 52 105
Finance income
Interest income cash and cash equivalents (6) (2) (5)
266 162 415
4. Headline earnings
Profit attributable to equity holders of the company 463 394 991
Impairment of property, plant and equipment 3 5 18
Gain on disposal of property, plant and equipment (1)
Total non-controlling interests' share of adjustments (1) (2) (7)
Headline earnings 465 397 1 001
Weighted average number of shares in issue (million) 177,1 181,0 178,8
Headline earnings per share (cents) 262,3 219,3 559,3
Diluted headline earnings per share (cents) 262,3 218,8 559,3
Adjusted headline earnings
Headline earnings (as above) 465 397 1 001
Net gain on translation of net US dollar receivables (14) (24) (191)
Total tax effects of adjustments 4 7 53
Adjusted headline earnings 455 380 863
Undiluted adjusted headline earnings per share (cents) 256,7 209,7 482,4
Diluted adjusted headline earnings per share (cents) 256,7 209,3 482,4
5. Segmental reporting
Revenue
Reportable segments
Containers finance (including exchange differences) 25 43 296
Containers owning, leasing, management and reselling 2 113 2 387(1) 4 353(1)
2 138 2 430 4 649
Profit from operations
Reportable segments
Containers finance 50 44 248
Containers owning, leasing, management and reselling, including gain on disposal of
containers to non-controlling interest in 2011 1 058 922(2) 1 934(2)
1 108 966 2 182
Unallocated (20) (8) (20)
1 088 958 2 162
Profit before taxation
Reportable segments
Containers finance 50 44 248
Containers owning, leasing, management and reselling, including gain on disposal of
containers to non-controlling interest in 2011 786 758(2) 1 512(2)
836 802 1 760
Unallocated (15) (6) (15)
821 796 1 745
1 Includes R899 million revenue in respect of containers sold to non-controlling
interest.
2 Includes R134 million gain in respect of containers sold to non-controlling interest.
Assets
Capital expenditure incurred by the container owning, leasing, management and
reselling segment 3 875 3 989 5 396
In order to provide a better appreciation of the results of the group's activities, a condensed consolidated income statement and a statement of
financial position are also presented in US dollars, as virtually all of the group's revenue and assets and much of its expenditure are denominated in
that currency. The amounts stated in US dollars have been prepared by management and are unaudited.
Unaudited Trencor condensed consolidated income statement in US dollars
for the six months ended 30 June 2012
Unaudited Unaudited Unaudited
6 months 6 months year
ended ended ended
30 June 30 June 31 December
US$ Million 2012 2011 2011
Revenue 269,2 352,3 620,5
Trading profit before items listed below 132,1 135,7 271,3
Realised and unrealised exchange gains arising on translation of long-term receivables 0,6 4,7
Net long-term receivable fair value adjustment 4,6 2,8 6,1
Impairment of plant and equipment (0,3) (0,8) (2,4)
Profit from operations 137,0 137,7 279,7
Net finance (expenses)/income (33,8) (23,7) (57,8)
Finance expense Interest expense (31,7) (16,4) (43,7)
Losses on derivative financial instruments (2,8) (7,6) (14,7)
Finance income Interest income 0,7 0,3 0,6
Loss from equity accounted investee (net of tax) (0,1) - (0,2)
Profit before tax 103,1 114,0 221,7
Income tax expense (6,5) (7,0) (7,8)
Profit for the period 96,6 107,0 213,9
Attributable to:
Equity holders of the company 57,9 55,7 122,7
Non-controlling interest 38,7 51,3 91,2
96,6 107,0 213,9
Number of shares in issue (million) 177,1 176,7 177,1
Weighted average number of shares in issue (million) 177,1 181,0 178,8
Basic earnings per share (US cents) 32,7 30,8 68,6
Diluted earnings per share (US cents) 32,7 30,7 68,6
Headline earnings per share (US cents) 32,8 31,0 69,2
Diluted headline earnings per share (US cents) 32,8 30,9 69,2
Adjusted headline earnings per share (US cents) 32,7 31,0 66,6
Diluted adjusted headline earnings per share (US cents) 32,7 30,9 66,6
Period-end rate of exchange: SA rand to US dollar 8,24 6,76 8,12
Average rate of exchange for the period: SA rand to US dollar 7,89 6,84 7,20
Trading profit from operations comprises:
Textainer 134,4 116,1 251,8
Textainer gain on sale of containers to non-controlling interest 19,8 20,4
Other (2,3) (0,2) (0,9)
132,1 135,7 271,3
Unaudited Trencor condensed consolidated statement of financial position in US dollars
at 30 June 2012
Unaudited Unaudited Unaudited
30 June 30 June 31 December
US$ Million 2012 2011 2011
ASSETS
Property, plant and equipment 2 320,4 1 851,7 1 921,2
Long-term receivables 82,3 117,8 93,1
Other non-current assets 153,0 148,6 151,8
Non-current assets 2 555,7 2 118,1 2 166,1
Current assets 353,4 284,5 336,1
Inventories 24,3 5,0 20,8
Trade and other receivables 100,0 86,5 95,3
Current portion of long-term receivables 31,0 21,2 35,1
Current portion of net investment in finance leases 20,0 20,6 20,6
Current tax assets 0,3 0,2
Cash and cash equivalents 178,1 150,9 164,1
Total assets 2 909,1 2 402,6 2 502,2
Equity and liabilities
Equity attributable to equity holders of the company 620,4 541,4 590,6
Non-controlling interest 302,6 244,1 269,4
Total equity 923,0 785,5 860,0
LIABILITIES
Interest-bearing borrowings 1 389,9 1 237,3 1 358,5
Amounts attributable to third parties in respect of long-term receivables 19,2 31,7 21,3
Derivative financial instruments 13,9 14,9 16,1
Deferred revenue 0,1 1,6 1,1
Deferred tax liabilities 25,2 31,0 27,6
Total non-current liabilities 1 448,3 1 316,5 1 424,6
Current liabilities 537,8 300,6 217,6
Trade and other payables 261,9 186,1 62,8
Current tax liability 12,4 11,2 9,6
Current portion of amounts attributable to third parties in respect of long-term receivables 5,9 3,4 6,5
Current portion of interest-bearing borrowings 255,0 91,5 132,5
Current portion of deferred revenue 2,6 8,4 6,2
Total liabilities 1 986,1 1 617,1 1 642,2
Total equity and liabilities 2 909,1 2 402,6 2 502,2
Ratio to total equity:
Total liabilities (%) 215,2 205,9 191,0
Interest-bearing debt (%) 178,2 169,2 173,4
These results can be viewed on the website www.trencor.net
Date: 15/08/2012 04:01:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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