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Audited results for the year ended 30 June 2012
AFROCENTRIC INVESTMENT CORPORATION LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1988/000570/06)
JSE Code: ACT, ACTP ISIN: ZAE000078416, ZAE000082269
("AfroCentric" or "the Company")
AUDITED RESULTS
for the year ended 30 June 2012
HIGHLIGHTS
Earnings per share 39%
Profit for the year 43%
Headline earnings per share 16%
Cash earnings per share 55%
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION EARNINGS ATTRIBUTABLE TO EQUITY HOLDERS
Audited year Audited year Audited year Audited year
ended ended % ended ended
30 June 2012 30 June 2011 change 30 June 2012 30 June 2011
R’000 R’000 R’000 R’000
Number of ordinary shares in issue 268 231 817 265 947 672
ASSETS Number of preference shares in issue 16 638 000 16 638 000
Non-current assets 991 884 951 923 Weighted average number of ordinary shares 267 276 657 264 561 839
Property, plant and equipment 97 016 101 083 Weighted average number of ordinary shares, potential
Investment property 10 300 10 100 ordinary shares and share awards for AHL executives 332 384 302 311 493 781
Intangible assets 611 042 609 552 Basic earnings 40.3% 164 506 117 248
Unlisted investments 280 280 Adjusted by:
Investment in associates 86 765 63 859 - Impairment of property, plant and equipment - 146
Investment in preference shares 100 000 100 000 - Impairment of intangible assets - 4 958
Deferred income tax assets 86 481 67 049 - Impairment of investment (1 175) -
- Impairment of investment in associate - 10 266
Current assets 371 416 291 066 - Profit on disposal of assets (566) (1 226)
Trade and other receivables 108 511 93 010 - Fair value gains on investment in associate (13 162) -
Receivables from associates and joint ventures 14 591 18 041 - Fair value gains (other) (810) (4 466)
Current tax asset 6 404 - Headline earnings 17.2% 148 793 126 926
Cash and cash equivalents 241 910 180 015 Earnings per share (cents)
- Basic 38.9% 61.55 44.32
Total assets 1 363 300 1 242 989 - Diluted 38.9% 52.31 37.64
Headline earnings per share (cents)
EQUITY AND LIABILITIES
- Basic 16.0% 55.67 47.98
Capital and reserves 882 815 726 850 - Diluted 16.8% 47.58 40.75
Issued capital 349 365 372 060 Cash earnings per share generated from operations (cents)
Contingent shares to be issued 188 540 188 540 - Basic 54.9% 95.48 61.63
Share-based awards reserve (Note 1) 9 357 - Diluted 46.7% 76.77 52.34
Treasury shares (1 772) (1 162)
Foreign currency translation reserve (646) 241 COMMENTARY
Distributable reserve 337 971 167 171
Minority interests 30 625 20 786 Introduction AfroCentric’s investment in Jasco yielded earnings of
Total equity 913 440 747 636 The Board of Directors has pleasure in presenting the R5.9 million (2011: R2.1 million) and investment income
Group’s Audited results for the year ended 30 June of R7.2 million (2011: R7.4 million) for the year under
Non-current liabilities 271 968 304 129 review. Given the Spescom acquisition, Jasco has itself
2012.
Deferred income tax liabilities 47 595 37 273 emerged from a restructuring and rebranding of its
Borrowings 200 000 200 000 While South Africa’s economy experienced wide various business units and the improvement in earnings,
Provisions 8 350 41 600 fluctuations in the levels of business confidence already visible in its overall results, is encouraging.
Post-employment medical obligations 3 504 3 821 during the year, subsidiary and associate management Further information on Jasco’s operating performance
Accrual for straight lining of leases 12 519 21 435 diligently maintained a consistent and disciplined can be found on the Stock Exchange News Service
Current liabilities 177 892 191 224 approach towards achieving their financial goals, the (SENS) under the code: JSC.
Borrowings 8 346 - positive results of which, are once again revealed in the
The exploration and prospecting nickel project
Provisions 8 779 20 378 Group’s sound pattern of growth in earnings.
in the North West Province did not fulfil its early
Trade and other payables 76 802 76 336 Further detail on each of the Group’s more meaningful mineralisation promise and further exploration on
Taxation 4 149 8 495 investment activities are set out in the review that this project was recently terminated. AfroCentric has
Bank overdraft - 7 304 follows. however concluded a further contract with Rio Tinto
Employment benefit provisions 79 816 78 711 for a significant minority interest in a new iron-ore
Accounting policies and basis of exploration project on terms consistent with the
Total liabilities 449 860 495 353
preparation continuing RSCA.
Total equity and liabilities 1 363 300 1 242 989 The condensed consolidated financial statements for the
Financial results
year ended 30 June 2012 are prepared in accordance
The Group financial results are clearly set out in the
with International Financial Reporting Standards
tables above and in the Statement of Comprehensive
(“IFRS”), the JSE Limited Listings Requirements and the
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Income. Reference is made in Note 1 above to the
South African Companies Act 71 of 2008 as amended.
present “actuarially determined cost of share-based
Audited year Audited year The condensed consolidated financial statements are
ended ended awards reserved for selected executives of AHL in terms
prepared on the historical cost basis and the accounting
% 30 June 2012 30 June 2011 of the 2009 Acquisition Agreement”. In terms of that
change R’000 R’000 policies are consistent with those adopted and applied
agreement, the extent of the executive awards and
Revenue 1 448 261 1 351 253 for the year ended 30 June 2011. the increased cost of the AHL investment, will only be
Operating costs (1 188 960) (1 128 140) accurately determined when the required number of
Operating profit 16.2% 259 301 223 113 Nature of business shares are allotted after the 2013 financial year; the
Other income 14 894 31 978 AfroCentric is a black-owned, diversified investment impact on earnings per share being reliably revealed
Net finance income 3 371 1 478 holding company. It is listed on the Johannesburg Stock only in the 2014 financial year. Accordingly, for a better
Share of profit from associates 14 842 10 888 Exchange (“JSE”) in the Healthcare Sector under the appreciation by shareholders:-
Profit before impairment and amortisation 292 400 267 457 code: ACT. The Group’s preference shares are also listed
Fair value gain (impairment) of investment 1 175 (10 266) on the JSE under the code: ACTP. 1. The diluted earnings per share and diluted headline
Fair value gain on investment in associate 13 162 - earnings per share takes into account the weighted
AfroCentric holds a substantial majority stake in average number of shares in issue, the potential
Impairment of intangible assets - (4 958)
AfroCentric Health Limited (“AHL”), formerly Lethimvula ordinary shares and assumes the issue of shares
IFRS 2 compliance adjustment (Note 1) (9 357) -
Investments Limited. During the year, AfroCentric reserved for AHL executives as if the profit warranty
Depreciation (38 128) (44 170)
increased its holding in AHL to 93.17% (2011: 91.56%) has been fully attained.
Amortisation of intangible assets (36 356) (35 542)
through the purchase of minority shareholdings in that
Profit before income tax 222 904 172 521 2. The diluted earnings per share and diluted headline
company. AfroCentric continues to engage with AHL
Income tax expense (42 523) (45 982) earnings per share have been calculated after
shareholders who wish to offer their AHL shares for sale.
Profit for the year 42.5% 180 381 126 539 adding back the IFRS 2 compliance adjustment of
AHL owns 100% of the issued shares in Medscheme
Attributable to: R9 357 000.
Holdings (Pty) Limited (“Medscheme”), a multi-medical
Equity holders of the Parent 164 506 117 248
scheme administrator and managed care provider. Prospects
Non-controlling interest 15 875 9 291
Total comprehensive income for the year 180 381 126 539 AfroCentric has a 27.3% non-controlling interest in JSE- The principal investments of the Group, AHL and Jasco
Note 1: Actuarially determined cost of share-based awards reserved for selected executives of AfroCentric listed Jasco Electronics Holdings Limited (“Jasco”). compete in industries that have traditionally been
Health Limited (AHL) in terms of the 2009 Acquisition Agreement, categorised for disclosure herein in terms of controlled by some of South Africa’s largest Institutions.
Jasco provides solutions, services and products to For AfroCentric, substantially a Black controlled “start
IFRS 2. customers through three core verticals: Information up” investment Group, to have secured a foothold
and Communication Technologies, Industry Solutions in each case, begins to reveal a transformational
and Energy Solutions. One of Jasco’s investments is adoption and market confidence in the values and
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY Malesela Taihan Electric Cables (M-Tec). M-Tec is a professionalism that characterise the Group’s skills
leading manufacturer and distributor of fibre-optic cable and efficiencies, as well as the affordability of and
Audited year Audited year
ended including a wide range of power and telecom cables, belief in its products and services. The Board has
ended
30 June 2012 30 June 2011 serving inter alia, infrastructural development demands great confidence in each of the Group’s teams of
R’000 R’000 in the South African and African continental markets. management and would be more than satisfied with a
Balance at beginning of the period 747 635 642 063 Further information on Jasco can be found on the JSE recurring level of growth going forward.
Issue of share capital 5 579 5 996 lists under the code: JSC.
Share-based awards reserve (Note1) 9 357 - Pre and post year-end events
Revaluation of treasury shares issued (609) (552) AfroCentric’s exploration and prospecting relationship Since the year-end Ms NB Bam retired as Chairperson
Dividends reclaimed and subsidiary acquisitions 5 868 - with Rio Tinto PLC continues in terms of the and Mr MI Sacks retired as Secretary. Both will however,
Foreign currency translation reserve (887) 241 Relationship and Strategic Cooperation Agreement remain as Non-Executive Directors. Dr AT Mokgokong
Dividends paid (33 884) (26 652) (RSCA). was appointed Non-Executive Chairperson and Mr D
Net profit for the year 164 506 117 248 Dempers was appointed a member of the Board as
Profit attributable to minorities 15 875 9 291 Operational review Group Chief Executive Officer.
Balance at end of period 913 440 747 635 Operating profit increased by 16.2% to R259 million
(2011: R223 million). Given the rationalisation benefits Audit opinion
now enjoyed through the Old Mutual acquisition, The Group’s annual financial statements have been
including further savings in rentals, IT costs and other audited by SizweNtsalubaGobodo Inc and their
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS overhead expenditure, the business was managed off unqualified audit report is available for inspection at the
Audited year Audited year a more efficient platform resulting in a better quality registered office of the company.
ended ended of earnings. AHL’s profitability is substantially on target
% 30 June 2012 30 June 2011 with its forecasts, positively trending towards the profit Dividend declaration
change R’000 R’000 warranty thresholds on which the price of the AHL To be announced shortly.
Cash generated from operations 56.5% 255,184 163,049 investment will be determined.
Net finance income 3,371 1,478
Dividends paid (28,274) (25,800)
Tax and other payments (114,045) (34,733)
Net cash generated in operating activities 116 236 103 994
Net cash outflow from investing activities (55 353) (88 869)
Net cash inflow from financing activities 8 315 43 050
Net increase in cash and cash equivalents 69 198 58 175
Cash and cash equivalents at beginning of the year 172 712 114 536
Cash and cash equivalents at end of the year 40.0% 241 910 172 711
Reconciled as follows:
Cash and cash equivalents on hand 241 910 180 015
Bank overdraft - (7 304 )
241 910 172 711
SEGMENTAL ANALYSIS Audited results Audited results
for the year ended 30 June 2012 for the year ended 30 June 2011
Revenue Profit before tax Total assets Revenue Profit before tax Total assets
R’000 R’000 R’000 R’000 R’000 R’000
Healthcare administration 1 448 261 217 086 977 763 1 351 253 185 094 874 386
Electronics (including investment income) - 5 988 - - 2 147 -
Treasury activities - 7 758 119 561 - 8 049 110 272
Other (including inter-segment elimination) - (7 928) 265 976 - (22 768) 258 331
1 448 261 222 904 1 363 300 1 351 253 172 521 1 242 989
Johannesburg
27 September 2012
Sponsor
Sasfin Capital
(A division of Sasfin Bank Limited)
Date: 27/09/2012 04:08:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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