Wrap Text
Reviewed Condensed Provisional Consolidated Results For The Year Ended 28 February 2013
LABAT AFRICA LIMITED
Incorporated in the Republic of South Africa
(Registration number 1986/001616/06)
JSE code: LAB ISIN: ZAE000018354
(“Labat” or “the company”)
REVIEWED CONDENSED PROVISIONAL CONSOLIDATED RESULTS FOR THE YEAR
ENDED 28 FEBRUARY 2013
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Reviewed Audited
for the 12 for the 12
months ended months ended
28 February 29 February
2013 2012
R'000 R'000
Continuing operations
Revenue 13,249 15,544
Cost of sales (5,975) (6,960)
Gross profit 7,274 8,584
Other income 8,054 1,517
Operating expenses (14,892) (16,967)
Gain on derecognition of liability - 34,020
Impairments (150) (1,663)
Operating profit 286 25,491
Investment revenue 17 18
Finance costs (1,615) (216)
(Loss)/profit before taxation (1,310) 25,293
Taxation 853 460
(Loss)/profit from continuing
operations (457) 25,753
Discontinued operations
Loss from discontinued operations (441) (364)
(Loss)/Profit for the year (898) 25,389
Comprehensive (loss)/profit for the
year - -
Total comprehensive (loss)/profit for
the year (898) 25,389
(Loss)/profit and comprehensive
(loss)/profit attributable to:
Owners of the parent:
(Loss)/profit and total comprehensive
(loss)/profit for the year from
continuing operations (457) 25,753
(Loss)/profit and total comprehensive
(loss)/profit for the year from
discontinuing operations (441) (364)
(Loss)/profit and total comprehensive
loss for the year attributable to
owners of the parent (898) 25,389
EARNINGS AND HEADLINE EARNINGS PER SHARE
Total basic loss per share (cents)
-Continuing operations (0.23) 13.06
-Discontinued operations (0.22) (0.18)
Total headline and diluted headlined
loss per share (cents)
-Continuing operations 0.03 13.51
-Discontinued operations (0.00) (0.18)
The (loss)/profit per share and
Headline (loss)/profit per share were
determined using the following
information:
(Loss)/profit attributable to
shareholders of the Group
-Continuing operations (457) 25,735
-Discontinued operations (441) (364)
HEADLINE EARNINGS:
(Loss)/profit attributable to
shareholders of the Group
-Continuing operations (457) 25,735
-Discontinued operations (441) (364)
Adjusted for:
(Loss)/profit on disposal of property
plant and equipment
-Continuing operations 370 1 663
-Discontinued operations - -
Impairments
-Continuing operations 150 (783)
-Discontinued operations 441 (1 050)
Headline (loss)/profit for the period
-Continuing operations 63 688 26633
-Discontinued operations - 5437
Weighted number of ordinary shares Number of Weighted
shares issued average number
(‘000) of shares
issued
(‘000)
Shares as at 28 February 2013 197 155 197 155
Shares as at 29 February 2012 197,155 197,155
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Reviewed Reviewed
12 months 12 months
28 February 29 February
2013 2012
R'000 R'000
ASSETS
Non-current assets 26,656 31,153
Current assets 7,973 8,303
Assets held for sale - 2,168
Total assets 34,629 41,624
EQUITY AND LIABILITIES
Share capital and reserves 1,378 2,277
Equity 1,378 2,277
Deferred taxation 4,554 5,407
Non-current liabilities 4 554 7,684
Current liabilities 28,697 33,940
Total equity and liabilities 34,629 41,624
Number of shares in issue ('000) 197,155 197,155
Total Net asset/(liability) value per
share (cents) 0.69 1.15
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Reviewed Reviewed
12 months 12 months
29 February
28 February 2013 2012
R'000 R'000
Net flow from operating activities (3,329) (2,860)
Net flow from investing activities 3,231 623
Net flow from financing activities (1,904) 268
Net decrease in cash (2,001) (1,969)
Cash at beginning of period 2,831 4,800
Cash at end of period 830 2,831
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Share Share Total Non Accumulate Total
Capita premiu share distribut d loss equity
l m capita able (‘000) (‘000)
(‘000) (‘000) l reserves
(‘000) –
Revaluati
ons
(‘000)
Balance at 1 490 49 065 50 555 15 520 (89 186) (23 111)
01 March
2011
Total 25 389 25 389
comprehensiv
e income for
the year
Transfer of (253) 253
revaluation
reserve
Balance at 1 490 49 065 50 555 15 267 (63 544) 2 277
01 March
2012
Total (898) (898)
comprehensiv
e loss for
the year
Transfer of (253) 253
revaluation
reserve
Transfer of (2 088) 2 088
revaluation
reserve on
disposal of
property
Balance at 1 490 49 065 50 555 12 926 (62 102) 1 378
28 February
2013
SEGMENTAL INFORMATION
SEGMENT REVIEW
Reviewed Audited
year year
ended ended
28 February 29 February
2013 2012
R(‘000) R(‘000)
Technology
External sales 13 249 15 544
Inter segmental revenue 1 080 1 080
Other Operations
External sales - -
Inter segmental revenue 4 200 2 632
Adjustments and eliminations (5 280) (3 712)
Total revenue 13 249 15 544
SEGMENT PROFIT / (LOSS)
Reviewed Audited
Year year
Ended ended
28 February 29 February
2013 2012
R(‘000) R(‘000)
Technology
Profit for the year 3 983 30 812
Other Operations (2 993) (5 176)
SEGMENT ASSETS
Reviewed Audited
as at as at
28 February 2013 29 February 2012
R(‘000) R(‘000)
Technology 48 409 58 106
Other operations 341 462
COMMENTARY
RESULTS
Headline earnings have decreased from 13.51 to 0.03 cents per share.
This decrease relates to a once-off write back of R34 million in the
previous year. Revenues have decreased by 14.8% during the year.
This decline relates directly to the product life cycle. The current
products are reaching the end of their marketable life cycle and are
in the process of being enhanced/replaced. A four year programme to
move production to China, move to a 0.5 micron platform and at the
same time improve the products, is nearing completion. Completion of
this programme will result in the re-launch of SAMES with a new
product range.
Operating expenses have been reduced by 12.2% which has enabled
losses to be contained.
Maximizing existing business values
The board has decided to restructure the existing SAMES business and
continues to dispose of assets which are surplus to the core business
going forward.
The SAMES property, after a two year exercise, has now been
completely emptied. After unsuccessful attempts to sell this
specialist property it is currently being tenanted. It should be
fully occupied by the middle of 2014. Fully tenanted it will have
substantial value and be highly marketable.
The SAMES i.c. business is being restructured in order to extract
maximum value for shareholders. A firm of specialist consultants has
been engaged to do an “as is” review and to assist with this process.
A product redesign programme is scheduled to be completed in April
2014 and should generate substantial sales volumes soon thereafter.
The A.P.I. Pharmaceutical opportunity will continue to be developed
to maximize shareholder value. The pre-feasibility review has been
successfully completed and contracts for the next phases (full
feasibility and implementation) are being negotiated with various
partners.
New direction
In our cautionary announcement of 4 April 2013 and our press release
of 17 May 2013 we announced our intention to turn the focus of Labat
towards oil and gas exploration. GEM, an existing shareholder and
funder, has agreed to fund the acquisition of suitable oil and gas
properties. GEM has identified the first of these leases in the
Luderitz and Walvis basins in Namibia and has agreed to fund their
development. A detailed announcement is expected to be issued within
the next two weeks.
Rights Issue
With a view to maximizing the new opportunities for existing
shareholders the board has agreed to a rights issue at a discounted
price in order to capitalize the Company ahead of these new
initiatives and give shareholders the opportunity to increase their
shareholding before the oil /gas acquisitions which will have a
dilutionary effect.
Prospects
The Company is currently better positioned than in the past and has a
number of sound opportunities. In particular, the oil and gas
prospects are looking very good. Recent drilling in Namibia has
discovered oil, although not yet in commercial quantities. Drilling
is continuing and expectations are high. Several good gas prospects
have been identified. Negotiations are taking place to secure other
oil and gas leases in Namibia and neighboring countries. GEM has
advised that funding for such acquisitions is available.
BASIS OF PREPARATION
Statement of compliance
These reviewed condensed provisional consolidated financial results,
comprise a condensed consolidated statement of financial position at
28 February 2013, a condensed consolidated statement of comprehensive
income, a condensed consolidated statement of changes in equity and a
condensed consolidated statement of cash flow for the year ended 28
February 2013. The reviewed condensed provisional consolidated
financial results have been prepared in accordance with the framework
concepts and the measurement and recognition requirements of IFRS and
the SAICA Financial Reporting Guides as issued by the Accounting
Practices Committee and Financial Reporting Pronouncements as issued
by Financial Reporting Standards Council, the presentation and
disclosure requirements of IAS 34: Interim Financial Reporting, the
JSE Limited Listings Requirements and the requirements of the South
African Companies Act 71 of 2008. The accounting policies are in
terms of IFRS and are consistent with those of the previous annual
financial statements. These reviewed condensed results were prepared
under the supervision of David J. O’Neill, in his capacity as Group
Financial Director.
Review Conclusion
The reviewed condensed provisional consolidated financial results of
the company and group have been reviewed by NexiaSAB&T. The auditors’
review report, which is available for inspection at the company’s
registered office, contains an emphasis of matter with regard to the
going concern of the Group, as follows:
Emphasis of matter
Without qualifying our conclusion, we draw attention to the going
concern paragraph in the directors’ commentary which indicates that
the group incurred a loss for the year ended 28 February 2013 of R898
929 and, at that date, the group’s current liabilities exceeded its
current assets by R20 723 347 before the loans from shareholders
amounting to R 7 141 767, which have been subordinated for the
benefit of other creditors to the group. The paragraph indicates that
directors have prepared the financial statements on the basis of
accounting policies applicable to a going concern on the basis that
the group has enough cash resources to meet its obligations as they
fall due.
Going Concern
The board of directors is of the opinion that, having regard to the
future strategy of the Group, the Group has sufficient resources to
continue as a going concern.
Litigation
The group has various claims and counter claims made by and against
Labat which have risen in the normal course of business. All these
matters are being dealt with by the company’s attorneys.
Share Capital
The Company did not issue shares or repurchase any of its own shares
during the year under review. The Company has 197 154 482 shares in
issue and 300 000 000 authorised shares.
Subsequent to the year end the Company issued 3,387,534 and 1,670,007
shares at 0.1476 and 0.1497 cents per share respectively under its
general authority to issue shares for cash.
Corporate Governance
The group subscribes to the values of good corporate governance at
all levels and is committed to conducting business with discipline,
integrity and social responsibility.
Post Balance Sheet Events
Management is not aware of any material events which occurred
subsequent to the year ended 28 February 2013.
Dividends
In line with group policy, no dividend has been declared.
For and on behalf of the board.
B G VAN ROOYEN D O’ NEILL
CEO FINANCIAL DIRECTOR
31 May 2013 31 May 2013
Directors
B. van Rooyen*, D.J O’Neill*, R. Majiedt^, B. Jacobs^, D. Lupungela^
Executive*, Independent non-executive^
Company Secretary: A Britto
Registered Address: 23 Kroton Avenue, Weltevreden Park, 1709
Sponsor: Arcay Moela Sponsors Proprietary Limited
Transfer Secretary: Computershare Investor Service Proprietary
Limited
Date: 03/06/2013 10:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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