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Reviewed results for the period ended 30 June 2012
M and S Holdings Limited
(Formerly Top Fix Holdings Limited)
(Incorporated in the Republic of
South Africa)
(Registration number:
2006/011359/06)
Share code: MSA
ISIN code: ZAE000088423
("M and S" or "the Company")
CONDENSED GROUP STATEMENT OF COMPREHENSIVE INCOME
Reviewed Audited
Year ended Year ended
R'000 30 June 30 June
2012 2011
Re-presented
Revenue 340 629 259 257
Cost of sales (287 578) (205 984)
Gross profit 53 051 53 273
Net operating expenses (22 125) (21 275)
Operating profit 30 926 31 998
Impairment of Investments in joint
ventures (644) -
Impairment of Loans in joint ventures (1 206) -
Interest received 9
759 9
Interest paid (2 801) (45)
Profit before taxation 27 034 31 962
Taxation (9 488) (8 414)
Profit attributable to the equity
holders of the parent 17 546 23 548
Other comprehensive income - -
Comprehensive income attributable to
equity holders of the parent from
continued operations 17 546 23 548
Comprehensive loss attributable to
equity holders of the parent from
discontinued operations (110 906) (13 631)
Total comprehensive (loss) / income
attributable to equity holders of the
parent (93 360) 9 917
Weighted average shares in issue
('000) 188 231 203 182
Calculation of headline earnings
Attributable (loss)/earnings (93 360) 9 917
Impairment of assets of the disposal
group 78 922 -
Loss recognized on the sale of the
disposal group 11 910 -
Loss on sale of property, plant and
equipment (after taxation) 19 3 943
Impairment of Investments 644 -
Headline Earnings (1 865) 13 860
Earnings / diluted earnings per share (cents)
(Loss)/earnings per share (49.6) 4.9
From continued operations 9.3 11.6
From discontinued operations (58.9) (6.7)
Headline (loss) / earnings per share (1.0) 6.8
From continued operations 9.7 11.6
From discontinued operations (10.7) (4.8)
CONDENSED GROUP STATEMENT OF FINANCIAL POSITION
Reviewed Audited
R'000 Year ended Year ended
30 June 30 June
2012 2011
ASSETS
Non-current assets 28 595 126 283
Property, plant and equipment 5 343 109 741
Goodwill 13 980 13 980
Investment in and loans to joint
ventures 2 455 1 124
Vendor loan payable 5 000 -
Deferred taxation 1 817 1 438
Current assets 64 317 70 846
Inventories 1 722 7 179
Trade and other receivables 61 389 62 422
Bank and call deposits 1 206 1 245
Non-current assets held for sale - 1 780
TOTAL ASSETS 92 912 198 909
EQUITY AND LIABILITIES
Capital and reserves 37 639 151 639
Non-current liabilities 1 820 1 879
Interest bearing liabilities 1 820 1 846
Deferred taxation - 33
Current liabilities 53 453 45 391
Interest bearing liabilities 378 5 956
Interest bearing loan from related
party 3 500 -
Bank overdrafts and invoice
discounting 17 356 18 216
Trade and other payables 29 079 19 174
Taxation payable 3 140 2 045
TOTAL EQUITY AND LIABILITIES 92 912 198 909
Shares in issue ('000) 155 182 203 182
Net asset value per share (cents) 24.3 74.6
Net tangible asset value per share
(cents) 15.2 67.8
CONDENSED GROUP STATEMENT OF CASH FLOWS
Reviewed Audited
R'000 Year ended Year ended
30 June 30 June
2012 2011
Cash flow from operations 6 847 9 812
Cash generated by operations 18 906 21 929
Interest received 759 28
Interest paid (4 013) (3 492)
Taxation paid (8 805) (8 653)
Cash flow from investing activities (5 088) (1 832)
(Increase)/decrease in advances to
joint ventures (2 644) 821
Cash flow from disposal of subsidiary (1 905)
Net (investment) / proceeds on
disposal of property, plant and
equipment (539) (2 653)
Cash flow from financing activities
Movement in loans payable (938) (12 008)
Increase /(decrease) cash resources 821 (4 028)
Cash resources at beginning of year (16 971) (12 943)
Cash resources at end of year (16 150) (16 971)
Cash resources (16 150) (16 971)
Bank and call deposits 1 206 1 245
Bank overdraft and invoice
discounting (17 356) (18 216)
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
Reviewed Audited
R'000 Year ended Year ended
30 June 30 June
2012 2011
Equity at beginning of year 151 639 141 722
Total comprehensive income for the
year (93 360) 9 917
Shares repurchased as per subsidiary (20 640) -
sale agreement
Equity at end of year 37 639 151 639
SEGMENT REPORTING (CONTINUED OPERATIONS)
Reviewed Audited
R'000 Year ended Year ended
30 June 30 June
2012 2011
Revenue
Personnel outsourcing 328 428 246 975
Total revenue 332 776 252 475
Internal (4 348) (5 500)
Safety surveillance 12 201 11 733
Total Group 340 629 258 708
Operating profit 30 926 31 998
Personnel outsourcing 26 385 29 051
Safety surveillance 4 282 2 948
Head office 259 (1)
Impairments
Personnel outsourcing (1 850) -
Net interest (paid)/received (2 042) (36)
Personnel outsourcing (2 040) 28
Safety surveillance (2) (64)
Profit before taxation 27 034 31 962
Personnel outsourcing 22 495 29 079
Safety surveillance 4 280 2 884
Head office 259 (1)
INFORMATION ON DISPOSAL GROUPS (SCAFFOLDING)
Reviewed Audited
R'000 Year ended Year ended
30 June 30 June
2012 2011
Analysis of the results of discontinued operations
Revenue 19 905 56 943
Expenses (38 767) (71 373)
Impairment of assets of the disposal (78 922) -
group
Operating loss (97 784) (14 430)
Interest received - 19
Interest paid (1 212) (3 447)
Loss before tax (98 996) (17 858)
Tax - 4 227
Loss after tax (98 996) (13 631)
Loss recognized on the sale of the (11 910) -
disposal group
Total comprehensive loss attributable (110 906) (13 631)
to the equity holders of the parent
from discontinued operations
Assets of the disposal group disposed
of
Non-current assets 24 697 107 138
Property, plant and equipment 24 624 106 956
Advances to joint ventures - 121
Deferred tax asset 73 61
Current assets 21 677 33 905
Inventories 2 061 5 803
Trade and other receivables 17 711 28 009
Bank and call deposits 1 905 93
Non-current assets held for sale - 1 780
TOTAL ASSETS 46 374 142 823
Liabilities of the disposal group
disposed of
Non-current liabilities 2 317 1 715
Interest bearing liabilities 2 317 1 715
Deferred taxation - -
Current liabilities 6 505 12 973
Interest bearing liabilities - 5 836
Bank overdrafts and invoice - 1 964
discounting
Trade and other payables 6 505 5 173
TOTAL LIABILITIES 8 822 14 688
Cash flow information
Cash flow from operations 4 206 (8 517)
Cash flow from investing activities 753 (810)
Cash flow from financing activities (1 183) 9 923
Increase / (decrease cash resources 3 776 596
REVIEWED PRELIMINARY RESULTS FOR THE YEAR ENDED 30 JUNE 2012
NOTES TO THE CONDENSED FINANCIAL STATEMENTS
BASIS OF PREPARATION
These results have been prepared in terms of International Financial
Reporting Standards and comply with IAS 34 – Interim Financial
Reporting, the Listings Requirements of the JSE Limited, the Companies
Act No. 71 of 2008 and the AC500 standards and interpretations. The
condensed financial statements do not include all of the information
required for a full set of annual financial statements.
The accounting policies applied are consistent with those applied in
the annual financial statements for 30 June 2011.
The condensed financial statements have been prepared under the
supervision of Ms. SL Kemp CA (SA), Financial Director.
DISCONTINUED OPERATION
During the period under review, the Group sold the entire issued share
capital and Group loan accounts against the Scaffolding Division (Top
Fix Scaffolding (Pty) Ltd and MBM Administration and Labour Brokers
(Pty) Ltd) to Mr BW Marais in exchange for 48 million Top Fix Holdings
shares, which were cancelled on 7 June 2012, and a cash consideration
of R5 million. The effective date of the sale was 8 March 2012.
Financial information relating to the scaffolding business operation
is set out after the Segment report. The results of the discontinued
operation are disclosed separately in the Statement of comprehensive
income and comparative figures have been re-presented. Refer to the
SENS announcement of 23 April 2012 for full details of the
transaction.
FINANCIAL PERFORMANCE
The Group’s results for the year were impacted by the underperformance
of the scaffolding business prior to its disposal while lower margins
in the personnel outsourcing division further reduced profitability,
despite an increase in revenue from continuing operations. These
factors contributed to a disappointing performance for the year.
Revenue from continuing operations increased by 31,4% from R259,3
million to R340.6 million in the current year, while the gross profit
percentage dropped from 20,6% to 15,6%.
For the year ended 30 June 2012, headline earnings per share from
continuing operations amounts to 9,7 cents, compared to 11,6 cents for
the year ended 30 June 2011.
Operating profit from continuing operations declined by 3,4% to R30,9
million.
Further to the SENS announcement of 21 September 2012, group results
for the year ended 30 June 2012 reflect a headline loss per share of
1,0 cents, compared to headline earnings per share of 6,8 cents
achieved for the comparative period to 30 June 2011. This is due to
poor performance of the scaffolding division. An impairment of R78,9
million was raised against the scaffolding division’s property, plant
and equipment (predominantly access scaffolding) at 31 December 2011.
Refer to SENS announcement dated 30 March 2012 for details of the
impairment.
Net interest charges incurred in the current year were R3,2 million as
compared to R3,5 million in the comparative period.
PERSONNEL OUTSOURCING
The Personnel Outsourcing division achieved an operating profit for
the year of R26,8 million, representing a decline of 7,6% on those
achieved for the year ended 30 June 2011, mainly due to pressurized
trading margins. Contracts for international personnel placements in
Mozambique continue and further international placements are being
actively pursued.
SAFETY SURVEILLANCE
The Safety Surveillance division continues to perform well with
operating profit increasing from R2,9 million in the previous year to
R3,8 million for the year ended 30 June 2012.
CHANGE OF NAME
The Company changed its name from “Top Fix Holdings Limited” to “M&S
Holdings Limited”, converted its share capital from shares with a par
value of R0.0001 each to shares of no par value and adopted a new
memorandum of incorporation, in terms of the circular to shareholders
dated, 23 April 2012 and the announcement dated 20 July 2012.
CHANGES IN DIRECTORS
Messrs. BW Marais and JA Barker resigned on 14 February 2012 and 27
February 2012 respectively to continue with the disposed Scaffolding
operation. Mr Marias’ position of Group Chief Executive has been
assumed by executive director, Mr FF Goosen and Ms SL Kemp (formerly
Group Financial Manager) has assumed Mr Barker’s position as Group
Financial Director.
RELATED PARTY TRANSACTIONS
As detailed above, the scaffolding division has been sold to Mr BW
Marais during the period under review.
During the year the Group borrowed various amounts to assist with
working capital requirements from JJ Senekal (director) on a short
term basis (one month loans) at a rate of R 50 000 per month per
R 1 million borrowed. At year end an amount of R 3.5 million was
owing to JJ Senekal. This amount was repaid in July 2012.
FUTURE PROSPECTS
The shortage of skilled artisans experienced in Sub-Saharan Africa
leave the Personnel Outsourcing division’s operations well placed to
take advantage of organic growth opportunities. The Safety
Surveillance division is expected to continue to operate well and
contribute to Group profitability. The Group is focused on securing
new contract business in all divisions.
CAPITAL COMMITMENTS AND CONTINGENCIES
The Group had no significant outstanding capital commitments or
contingencies as at 30 June 2012.
DIVIDEND DECLARATION
No dividend has been declared for the year.
REVIEW REPORT
The condensed consolidated preliminary results for the year ended 30
June 2012 have been reviewed by PKF (Jhb) Inc. The external auditors’
unqualified review opinion is available for inspection at the
company’s registered office.
For and on behalf of the Board
BT Ngcuka (Chairman) FF Goosen (Chief Executive)
Date: 28 September 2012
Directors:
BT Ngcuka* (Chairman); FF Goosen (CEO); SL Kemp (Financial Director);
JJ Senekal*#; NN Sonjani*#; PN de Waal* (* - non-
executive) (# - independent)
Secretary and Registered Office:
MN Hattingh, 6 Topaz Street, Littleton Manor, Centurion 0157
Transfer Secretaries:
Link Market Services South Africa (Pty) Ltd, 11 Diagonal Street,
Johannesburg 2000 (PO Box 4844, Johannesburg 2001)
Designated Advisor:
Sasfin Capital, a division of Sasfin Bank Ltd
Website:
www.topfixholdings.co.za
Date: 28/09/2012 05:04:00 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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