Wrap Text
Unaudited group condensed financial statements
for the six months ended 31 August 2013
Wilderness Holdings Limited
Wilderness or the Company or the Group
Share code: WIL ISIN: BW0000000868
Registration number: 2004/2986
BSE: Primary Listing JSE: Secondary Listing
Unaudited group condensed financial statements
for the six months ended 31 August 2013
Highlights
Occupancy in owned camps increased from 62% to 67% US dollar turnover
has increased by 9%
Turnover increased by 16% to BWP778 million
EBITDA increased to BWP106 million, 49% up on the corresponding period
Profits after tax increased by 72% to BWP48.6 million
Headline earnings per share up 109%
Condensed group statements of comprehensive income
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 Change 31 Aug 2012 28 Feb 2013
Revenue 778 460 16% 672 323 1 205 074
Cost of sales (449 297) (382 931) (690 529)
Gross profit 329 163 289 392 514 545
Other gains 2 836 4 132 22 889
Operating expenses (225 303) 5% (214 654) (419 605)
Foreign exchange
losses (329) (7 571) (8 928)
Operating profit
for year before
items listed below
(EBITDA) 106 367 49% 71 299 108 901
Impairment loss (2 830) (136) (14 000)
Depreciation and
amortisation (23 846) (23 981) (46 982)
Operating profit 79 691 69% 47 182 47 919
Net finance costs (3 854) (3 990) (8 205)
Unrealised foreign
exchange loss on
loans (5 041) (3 324) (7 260)
Share of associate
company profit 1 524 712 66
Profit before
taxation 72 320 78% 40 580 32 520
Taxation (23 715) (12 300) (4 816)
Profit for the
period 48 605 72% 28 280 27 704
Other comprehensive
loss (917) (2 209) (3 156)
Exchange differences
on translating foreign
operations:
Equity holders of
the Company 6 059 6 244 9 470
Non-controlling
interest (753) (847) (1 013)
Net investment in
foreign operation (6 223) (7 606) (11 613)
Total comprehensive
income for the
period 47 688 26 071 24 548
Profit/(loss)
attributable to:
Owners of the
Company 43 434 24 545 29 561
Non-controlling
interest 5 171 3 735 (1 857)
48 605 28 280 27 704
Total comprehensive
income/(loss)
attributable to:
Owners of the
Company 43 270 23 183 27 418
Non-controlling
interest 4 418 2 888 (2 870)
47 688 26 071 24 548
Number of shares
issued (thousands)
Issued and weighted
average 231 000 231 000 231 000
Diluted weighted
average 232 604 231 000 231 094
Earnings per share
(thebe)
Basic 18.80 77% 10.63 12.80
Diluted 18.67 73% 10.63 12.79
Basic headline 18.79 109% 8.98 11.13
Diluted headline 18.66 104% 8.98 11.13
Condensed group statements of financial position
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 31 Aug 2012 28 Feb 2013
Assets
Non-current assets 474 328 468 338 474 047
Property, plant and
equipment 387 753 392 869 382 372
Goodwill 32 874 31 396 34 855
Intangible assets 11 085 3 190 8 863
Investments and loans in
associates 14 840 15 275 11 390
Loans receivable 1 664 2 009 1 768
Deferred tax assets 26 112 23 599 34 799
Current assets 502 137 414 723 319 065
Inventories 21 150 20 134 17 889
Receivables and
prepayments 150 603 100 909 97 384
Current tax receivable 8 023 8 721 14 467
Bank balances and cash 322 361 284 959 189 325
Non-current assets held
for sale 1 386
Total assets 976 465 883 061 794 998
Equity and liabilities
Equity attributable to the
owners of the Company 382 200 339 105 344 728
Stated capital 153 703 153 703 153 703
Foreign currency
translation reserve 15 251 16 187 15 406
Common control reserve (73 324) (73 324) (73 324)
Other non-distributable
reserves 18 295 13 501 16 374
Share-based payment
reserve 8 442 2 665 4 651
Retained income 259 833 226 373 227 918
Non-controlling interest (4 661) (645) (7 259)
Total equity 377 539 338 460 337 469
Non-current liabilities 133 095 160 650 130 249
Borrowings 105 754 132 218 102 129
Deferred tax liabilities 27 341 28 432 28 120
Current liabilities 465 831 383 951 326 780
Trade and other payables 411 004 329 463 273 724
Current tax liabilities 3 266 2 404 3 368
Bank overdrafts 51 561 52 084 49 688
Total liabilities 598 926 544 601 457 029
Total equity and
liabilities 976 465 883 061 794 498
Net asset value per share
(thebe) 165 147 149
Net tangible asset value
per share (thebe) 146 132 130
Condensed group statements of cash flows
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 31 Aug 2012 28 Feb 2013
Net cash generated from
operating activities 172 183 112 489 77 518
Net cash used in investing
activities (33 594) (34 825) (66 253)
Net cash used in financing
activities (17 300) (12 460) (44 960)
Net increase/(decrease) in
cash and cash equivalents 121 289 65 204 (33 695)
Unrealised exchange gains
on foreign cash balances 9 874 10 167 15 828
Cash and cash equivalents 139 637 157 504 157 504
at the beginning of the period
Cash and cash equivalents
at the end of the period 270 800 232 875 139 637
Segmental information
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 31 Aug 2012 28 Feb 2013
Revenue
Botswana 245 470 207 550 356 527
Namibia 113 188 118 977 221 227
South Africa 595 701 495 968 891 074
Zambezi* 77 698 71 475 125 422
Intergroup (253 597) (221 647) (389 176)
Group 778 460 672 323 1 205 074
Profit/(loss) before taxation
Botswana 34 4377 17 503 35 524
Namibia (5 608) (4 361) (6 206)
South Africa 33 757 18 632 5 157
Zambezi* 9 653 8 714 (2 125)
Intergroup 81 92 170
Group 72 320 40 580 32 520
Total assets
Botswana 561 153 524 858 495 220
Namibia 142 011 144 720 134 160
South Africa 368 721 302 681 212 914
Zambezi* 116 722 104 815 81 393
Intergroup (212 142) (194 013) (129 189)
Group 976 465 883 061 794 498
* Zambezi includes Zambia and Zimbabwe regions.
Condensed statements of changes in total equity
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 31 Aug 2012 28 Feb 2013
Opening balance 337 469 331 212 331 212
Minority portion of
dividend paid (1 622) (342)
Dividends paid (9 240) (19 866) (19 865)
Total comprehensive income
for the period 47 688 26 071 24 548
Share-based payment
reserve 3 791 1 043 3 029
Other (547) (1 113)
Closing balance 377 539 338 460 337 469
Comprising:
Stated capital 153 703 153 703 153 703
Foreign currency
translation reserve 15 251 16 187 15 406
Common control reserve (73 324) (73 324) (73 324)
Other non-distributable
reserves 18 295 13 501 16 374
Share-based payment
reserve 8 442 2 665 4 651
Retained income 259 833 226 373 227 918
Total shareholders equity 382 200 339 105 344 728
Non-controlling interest (4 661) (645) (7 259)
Total equity 377 539 338 460 337 469
Commentary
The directors of Wilderness Holdings Limited are pleased to report
the results of the Groups operations for the half year ended
31 August 2013.
Our business
The Wilderness Group has been in existence for more than 30 years and
has grown into an internationally acclaimed organisation that is the
largest of its kind in Africa. We own and operate a network of 44
luxury safari camps that offer a total of 750 beds, in five southern
African countries. In addition, we manage a further nine camps
(offering 164 beds), in four countries, and market a further sixteen
camps (offering 262 beds), in two countries, under contract to their
respective owners. Of the marketed camps, we are invested in the companies
that own 14 of these camps (offering 230 beds) but these businesses are
managed by our partners. Altogether, we are engaged in the ownership,
management and marketing of 69 camps, totalling 1 176 beds and offering
nearly 409 000 available bednights, in nine countries.
During this reporting period we have commenced construction of our
proposed new Hoanib Skeleton Coast Camp in north-western Namibia. We
expect that the camp will be open for business in time for the busy
season commencing mid-2014. We have also been engaged by the owners
to market the new Segera Retreat in Kenya, under the Wilderness
Collection brand. In January of this year, our Pafuri camp in Kruger
National Park was badly damaged by floods and has been closed since
then. The process of settling the resultant insurance claim and
agreeing on what steps to take next is almost complete.
Our camps are mainly operated under our trading brand Wilderness
Safaris. The camps are serviced by a fleet of 42 aircraft operated
under the Wilderness Air brand. Between the various operations, the
Wilderness Group is proud to employ 2 705 people.
The Group operates off a sustainability platform (based on the 4Cs, a
concept that we have adopted from the Zeitz Foundation) that is
rolled out throughout the business and is believed to add
competitive advantage. This platform is frequently recognised by
local and international awards.
Trading environment
Demand out of our most important market, the United States, is
recovering strongly. Our next most important market, Europe, is also
showing positive signs of a slow recovery in demand although this
does appear to be susceptible to shocks. Our major local currencies
(being the Botswana Pula and the South African Rand), in which we
incur most of our costs, have continued to weaken relative to our
main trading currency, the US dollar. However, inflation in local
currencies continues to exert upward pressure on costs at rates
varying from 5.5% to 6.5% per annum.
Performance
Total bednight sales increased by 0.5% to 97 199 (this includes
marketed and managed camps). On a normalised basis, after camp
closures, there has been a 9% increase in bednight sales over the
same period in the prior year. This translates to an increase in
capacity utilisation in owned camps from 62% in the prior period to
67% in the current period. Our US dollar turnover, which accounts for
approximately 60% of our turnover, has increased by 9% as a result of
these volume increases, as well as price increases ranging largely between
2% and 8% passed to the market. In addition, our SA Rand turnover derived
from sale of products in South Africa,which comprises 19% of turnover,
has increased by 23%.
The Rand weakened by 19% against the US dollar over this reporting
period and this results in higher turnover in our reporting currency,
the Pula. However, this positive impact is offset by a 7% unfavourable move
in the Rand:Pula cross-rate. These factors have combined to increase turnover,
in reporting currency terms, by 16% over the prior period.
Our gross margin percentage is largely in line with the prior period
(42.3% compared to 43%). This is a function of a number of factors,
both positive and negative, none of which were individually
significant. The measures implemented to improve efficiency and
productivity have created cost savings which have partially offset
the effects of inflation such that operating expenses have increased
by 5% to BWP225.3 million. Foreign exchange losses were just
BWP329 000, a significant reduction on the losses of BWP7.6 million recorded
in the prior period. These losses (and any gains, when they arise)
are realised on forward foreign exchange contracts taken out to
minimise currency risk as well as from the effects of changing
exchange rates on conversion of our working capital.
The net effect of the above factors was that earnings before
interest, tax and depreciation (EBITDA) was BWP106.4 million, an
increase of 49% against the prior period result. The EBITDA margin
for the period is 13.6% which is the highest achieved since we listed
in 2010. We have taken the decision to impair goodwill on an under-performing
camp in Zambia in the sum BWP2 million and we have also reduced the expected
proceeds from insurance claims by BWP855 000. These, combined with
depreciation of BWP24 million which is in line with the prior year charge,
mean that operating profit increased by 69% to BWP79.7 million.
Finance costs of BWP3.9 million were in line with the prior period
but the unrealised loss on the US dollar denominated loans increased
from BWP3.3 million to BWP5 million, as the result of devaluation of
the Rand and the Pula against the US dollar.
Profits before tax were BWP72.3 million for the half year, up from
BWP40.6 million in the comparable period. Our effective tax rate
increased by 2.5% to 31%, largely as the result of the impairments
noted above, leaving after tax profits amounting to BWP48.6
million, an increase of 72% over the result for the 2012 half year.
(Corporate tax rates in the countries in which we operate range
from 25% in Botswana and 28% in South Africa to Zambia, the highest,
at 35%.)
The Group continues to generate cash, after paying dividends
(BWP9.2 million), long term loans repaid (BWP24.5 million) and capital
expenditure. During the half year we invested BWP37 million
(2012: BWP34.5 million) in subsidiaries, intangible assets
(mainly software systems) and camps and associated equipment and
infrastructure, in order to grow the business and maintain product
quality (historically, we have invested in the region of 5% to 6% of
turnover in new and replacement assets). The net increase in cash and
cash equivalents, including overdrafts, was BWP121.3 million,
compared with BWP65.2 million in the prior period. As at the
reporting date, the Group had debt (excluding overdrafts)
owing to third parties of BWP131.1 million (2012: BWP151.7 million).
The Group had cash reserves, net of overdrafts, amounting to
BWP270.8 million, compared to BWP232.9 million at the prior mid-
year. The BWP140 million increase in net cash holdings since the year
end reflects the cash cycle of the business in which prepayments for
travel bookings (termed future cash) are received in the period
leading up to our busy season, before being released to revenue as
the guests travel. This is reflected in the increase in trade and
other payables which has increased from BWP329 million at the prior
period end to BWP409 million. The increase in these payables is the
result of increased levels of business, mainly denominated in US dollars,
together with the devaluation of the Rand.
The same trends are shown in our receivables, for the same reasons.
Other achievements
During this period we continued to win regional and international
accolades for excellence of which the most important was the
prestigious Travel+Leisure magazines recognition of our Mombo camp
in Botswana as the best hotel in the world. Condé Nast Traveler
awarded us first place in the Wildlife category of the
2013 World Savers awards and TripAdvisor awarded 17 of our camps
Certificates of Excellence.
Dividend
As in prior years, due to the seasonal cash flow cycle of the
business, an interim dividend has not been declared. It is
anticipated that, in the event that a dividend is declared, this will
be in the form of a final dividend declared in May each year, subject
to the operating results, financial position, investment strategy,
capital requirements and other factors.
Directorate
On 19 July 2013, the Board appointed Keith Vincent, the former Chief
Operating Officer and Acting Chief Executive Officer, to the position
of Chief Executive Officer.
Mr Sidney Mganga was appointed Company Secretary on 6 September 2013.
Outlook for the remainder of the year
Coming after the difficult years that followed the global
financial crisis, the improvement in results reported above is the
result of the congruence of a number of positive factors:
-Improving demand out of our main source market which has resulted in
improved occupancies and increased selling prices;
-Successful implementation of strategic initiatives designed to:
improve the quality of our service and products; improve productivity
and efficiency; and to align the business with current levels of
demand;
-Largely favourable movements in exchange rates.
None of the above factors are expected to reverse significantly
before the end of February 2014 and the Board is therefore cautiously
optimistic regarding prospects for the remainder of the year.
By order of the Board
Parks Tafa Derek de la Harpe
Chairman Chief Financial Officer
25 October 2013
Notes to the condensed group financial statements
for the period ended 31 August 2013
Basis of preparation
This interim report complies with International Accounting Standard
34 Interim Financial Reporting and the disclosure requirements of
the Botswana Stock Exchange and the JSE Limited. The interim report
has been prepared using accounting policies that comply with
International Financial Reporting Standards. The accounting policies
are consistent with those applied in the financial statements for the
year ended 28 February 2013.
New accounting policies adopted
Improvements to IFRS
During the period under review, the Group adopted all the IFRS and
interpretations that were effective and deemed applicable to the
Group. None of these had any material impact on the financial results
of the Group.
Revenue
Traditionally the Group earns between 55% and 65% of its revenue in
the first six months of the financial year. The seasonality is
attributed in part to the holiday season in the American and European
markets together with the attraction of the annual water floods in
the Okavango Delta in Botswana.
Contingent liability
Included in the historical results is an amount of BWP29.2 million,
being the capital profit arising on the Duba Plains transaction.
As announced on 16 August 2010, the underlying transaction has been
concluded and full payment has been received by the Group. However,
this transaction was subject to certain conditions precedent which
have not yet been fulfilled.
As at the date of this report, negotiations with our counter- parties
to fulfil these conditions are well advanced and the directors are
confident that they will be fulfilled. Accordingly, the capital
profit has been brought to account and the amount is recorded as a
contingent liability until such time as all necessary regulatory
approvals have been formally obtained.
Events after balance sheet date
Subsequent to the period end, the conditions precedent to the sale of
a property and camp assets in Namibia, as well as our 50%
shareholding in a subsidiary in that country, were completed. This
disposal has resulted in a capital profit amounting to N$16.9 million
(BWP14.5 million) and the receipt of all sale proceeds amounting to
N$25.9 million (BWP22.2 million).
Unusual items
Other gains include gains from disposal of property, plant and
equipment and insurance proceeds amounting to BWP2.8
(2012: BWP4.1 million). The unrealised foreign exchange loss on loans
of BWP5 million (2012: gain BWP3.3 million) has been recognised as a
result of the restatement of the Groups USD denominated loans
amounting to USD13 million at 31 August 2013 (2012: USD16.6 million).
Translation of these loans into Pula for financial reporting purposes
results in an unrealised foreign gain or loss, depending on the USD
to Pula exchange rate on the date of reporting.
The loans are serviced and repaid in USD from USD revenue received by
the Group from foreign customers. There is thus a natural currency
hedge on the loans.
Segmental information
In line with a change in the internal structure of reporting and
management, the group has modified its operating segments from
operating divisions to geographic segments by country or region.
Consequently the segment report has been amended to reflect these new
segments as required by the management approach of IFRS 8 Segment
Reporting.
In order to allow for comparison the segment information has been
restated accordingly.
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
BWP000 31 Aug 2013 31 Aug 2012 28 Feb 2013
Reconciliation between
profit attributable to
owners of the Company
and headline earnings
Profit attributable to 43 434 24 545 29 561
owners of the Company
Adjustments
Surplus on disposal of
operations, investments
and associates (3 494)
Profit on disposal of
property, plant and
equipment (2 836) (567) (18 506)
Net
impairment losses 1 894 136 13 855
Tax effects of adjustments (29) 134 347
Minority interest 82 459
Headline earnings 45 403 20 754 25 716
Commitments
Capital
Authorised by directors
and contracted for
Not yet contracted for
but authorised by directors 17 916 30 807 54 334
17 916 30 807 54 334
It is intended to finance
capital expenditure from
working capital generated
and existing borrowing
facilities.
Operating leases
Minimum lease payments due
within one year 16 285 15 174 15 966
in second to fifth year
inclusive 53 200 54 502 55 293
after fifth year 81 297 42 627 83 215
150 782 112 303 154 474
Borrowings
Non-current
Interest bearing 122 484 143 545 119 101
Non-interest bearing 8 647 8 171 8 463
131 131 151 716 127 564
Less: Current portion of
long-term liabilities (25 377) (19 498) (25 435)
105 754 132 218 102 129
Tax reference number: C075372-01-01-7
Registered office: Plot 1 Mathiba Road Maun Botswana
External company registration number: 2009/022894/10
Registered office: 373 Rivonia Boulevard Rivonia South Africa
JSE Sponsor: Rand Merchant Bank (a division of FirstRand Bank Limited)
Transfer secretaries: Corpserve Botswana Computershare
Directors: P Tafa (Chairman), M Tollman (Deputy Chairman), K Vincent (CEO),
D de la Harpe (CFO), C de Fleurieu, R Hartman, J Hunt, R Marnitz,
M McCulloch, G Tollman, M ter Haar, J Zeitz
Company Secretary: S Mganga
www.wilderness-the4cs.
www.wilderness-safaris.com
www.wilderness-group.com
Date: 25/10/2013 09:12:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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