Wrap Text
Unaudited condensed consolidated interim results
for the six months ended 31 December 2013
Ascendis Health Limited
Registration number 2008/005856/06
JSE share code ASC
ISIN ZAE000185005
Unaudited condensed consolidated interim results
for the six months ended 31 December 2013
HIGHLIGHTS
Revenue up
114% to R662 million
Operating profit up
366% to R88 million
Operating margin improved from
6% to 13%
Headline earnings up from
-R4 million to R54 million
- Raised R453 million in successful JSE listing
- Continued strategic acquisitions
- Confident of achieving full year pre-listing
forecasts (plus benefit of new acquisitions)
COMMENTARY
OVERVIEW
Ascendis is a fast growing health and care group which sells health brands for humans, plants and
animals. Listed on the JSE on 22 November 2013, the group consists of three divisions: Consumer Brands
(nutraceuticals, vitamins, sports nutrition and skin care products); Phyto-Vet (plant and animal health and
care) and Pharma-Med (prescription drugs and medical devices). The group currently exports products to 45
countries, mainly in Europe and Africa.
STRATEGY
Ascendis is creating a synergistic group of health and care product brands spanning the value chain, from
imports of raw materials, manufacturing, brand development to distribution to consumers through retail and
direct selling channels locally and internationally.
Organic growth from the group's established, market-leading brands will be supported by the acquisition of
complementary businesses and brands for synergistic growth. This includes vertical integration across the value
chain and horizontal integration from bolt-on acquisitions.
Ascendis is rapidly growing its foreign customer base and the international expansion strategy includes
exports, establishing offshore operations and acquiring international businesses.
FINANCIAL PERFORMANCE
Ascendis has delivered on the commitments made to stakeholders at the time of the listing, with the results for the
six months indicating that the group is well on track to meet its pre-listing year end forecasts. The performance has
benefited from several acquisitions made by the group over the past 18 months and healthy organic growth of the
underlying established brands.
Revenue for the period increased by 114% from R310 million to R662 million. Foreign revenue increased by 209%.
The gross margin expanded from 42% to 46% despite imported inflation from the devaluation of the Rand. The
improvement was achieved through better buying, selected price increases as well as a better product and customer
mix. Further savings could be achieved by extracting synergies across the value chain, including joint manufacturing,
warehousing and route to market activities in the Consumer Brands and Phyto-Vet divisions.
Operating profit increased by 366% from R19 million to R88 million and the operating margin improved from
6% to 13%.
The performance for the six month period translated into headline earnings of R54 million (Dec 2012: -R4 million).
On the divisional performance, Consumer Brands generated revenue of R299 million (Dec 2012: R117 million)
and accounted for 45% of group revenue; Phyto-Vet R292 million (Dec 2012: R193 million) and Pharma-Med
R70 million. The medium-term targeted revenue split is Consumer Brands 40%, Pharma-Med 40% and
Phyto-Vet 20%.
ACQUISITIONS
The group has a track record of acquiring established businesses and strong brands which are integrated into the
divisional operations to create synergies. Shortly after the listing the group acquired Surgical Innovations, a
distributor of high-end medical devices to surgeons, for R300 million. The effective date of the acquisition was
1 January 2014 and the business is currently being integrated into the Pharma-Med division.
Post the end of the reporting period the group acquired Atka Pharma, which markets the BioBalance brand,
and last week announced the acquisition of PharmaNatura, pending competition approval. PharmaNatura sells
well established and trusted nutraceutical, homeopathic and herbal brands such as Vitaforce, Bettaway,
Homeoforce and Herbaforce which are manufactured at their plant in Johannesburg. This acquisition will enable
Ascendis to extract vertical synergies within its Consumer Brands division.
OUTLOOK
Ascendis has a portfolio of resilient, well-established brands which offer both pricing leverage and strong export
potential which positions it well in the face of a tough consumer economy, a more stringent regulatory environment
and a depreciating currency.
The brands in the Consumer Brands and Phyto-Vet divisions are mostly aimed at higher LSM consumers making
the business more resilient in the face of weaker economic conditions. The brands in the pharmaceutical sector
of the Pharma-Med division focus more on the lower LSM consumer and will benefit from government's focus on
making medicines more affordable and accessible, and the National Health Insurance implementation.
The group is well positioned to accelerate the growth in its export operations, with keen interest from offshore
distributors for several brands in the Ascendis stable which are not yet exported.
The group has a healthy acquisition pipeline and is currently evaluating projects in all divisions.
A key focus for the remainder of the financial year will be on continuing to deliver organic growth, integrating
acquisitions and extracting synergies both within and across the operating divisions.
The directors remain confident of achieving the pre-listing earnings forecast of R124 million after tax (after
capitalising listing fees) for the 2014 financial year, based on the existing business at the time of listing. In
addition there will be further benefits from post listing acquisitions.
The above information has not been reviewed or reported on by the group's external auditors.
Dr Karsten Wellner Robbie Taylor
Chief Executive Officer Chief Financial Officer
Cape Town
3 March 2014
UNAUDITED CONDENSED GROUP Unaudited Unaudited Audited
STATEMENT OF COMPREHENSIVE INCOME Six months ended Six months ended Year ended
31 Dec 31 Dec 30 Jun
2013 2012 2013
R R R
Revenue 661 901 513 309 643 297 613 447 802
Cost of sales 356 785 966 179 824 751 (350 249 250)
Gross profit 305 115 547 129 818 546 263 198 552
Other income 6 571 803 916 690 15 932 534
Operating expenses (excluding depreciation and amortisation) (209 829 642) (108 009 660) (205 984 243)
EBITDA 101 857 708 22 725 576 73 146 843
Depreciation and amortisation (14 279 407) (3 917 071) (9 500 933)
Operating profit 87 578 301 18 808 505 63 645 910
Finance costs (9 150 496) (23 136 746) (53 409 200)
Profit/(loss) before taxation 78 427 805 (4 328 242) 10 236 710
Taxation (22 744 064) (4 253 680) (6 063 130)
Profit/(loss) for the period 55 683 742 (8 581 922) 4 173 580
Other comprehensive income:
Items that will not be subsequently reclassified to profit and loss:
Gain on property revaluation - - 1 955 489
Taxation related to gain on property revaluation - - (547 537)
Items that may be subsequently reclassified to profit and loss:
Exchange differences on translating foreign operations 462 875 231 438 671 551
Other comprehensive income for the period net of taxation 462 875 231 438 2 079 503
Total comprehensive income/(loss) for the period 56 146 617 (8 350 485) 6 253 083
Profit/(loss) attributable to :
Owners of the parent 53 920 397 (4 514 103) 12 038 719
Non-controlling interest 1 763 345 (4 067 819) (7 865 139)
55 683 742 (8 581 922) 4 173 580
Total comprehensive income/(loss) attributable to:
Owners of the parent 56 146 617 (4 294 237) 13 686 262
Non-controlling interest - (4 056 248) (7 433 179)
56 146 617 (8 350 485) 6 253 083
UNAUDITED CONDENSED GROUP Unaudited Unaudited Audited
STATEMENT OF FINANCIAL POSITION Six months ended Six months ended Year ended
31 Dec 31 Dec 30 Jun
2013 2012 2013
R R R
Assets
Non-Current Assets
Property, plant and equipment 57 308 642 39 447 689 42 721 005
Goodwill 557 148 025 193 457 234 272 322 382
Intangible assets 273 757 482 37 264 459 35 997 081
Investment in joint venture 52 500 000 - -
Deferred tax 2 959 817 8 024 132 3 174 413
Loans to group companies 85 733 803 20 209 429 42 258 317
Other financial assets - - 197 620
1 029 407 770 298 402 943 396 670 818
Current Assets
Inventories 344 549 584 107 978 405 169 492 264
Loans to group companies - - 52 110 789
Current tax receivable 3 861 574 - 2 359 521
Other financial assets 1 822 204 - 3 612 559
Trade and other receivables 323 146 805 131 872 563 172 785 528
Cash and cash equivalents 238 729 028 32 182 543 134 983 928
912 109 194 272 033 511 535 344 589
Total Assets 1 941 516 964 570 436 454 932 015 407
Equity and Liabilities
Equity
Capital and reserves 1 010 904 276 42 716 260 390 338 875
Non-controlling interest 1 989 654 3 135 464 347 633
1 012 893 929 45 851 724 390 686 508
Liabilities
Non-Current Liabilities
Deferred tax - - 82 366
Deferred vendor liabilities - 49 597 697 -
Other financial liabilities 578 438 230 331 421 277 84 200 113
Finance lease obligation 810 715 - -
Operating lease liability - - 828 638
579 248 945 381 018 973 85 111 117
Current Liabilities
Loans from group companies - - 38 990 050
Deferred vendor liabilities 36 336 086 - 29 657 801
Other financial liabilities 14 789 473 54 264 149 242 010 419
Finance lease obligation 398 602 - 247 405
Current tax payable 17 291 025 1 952 882 5 789 192
Trade and other payables 280 558 904 87 348 725 128 785 616
349 374 089 143 565 756 445 480 483
Total Liabilities 928 623 035 524 584 730 530 591 600
Total Equity and Liabilities 1 941 516 964 570 436 454 932 015 407
Total
attributable
to equity
Foreign holders Non-
Total currency Change of of the controlling
share translation Revaluation ownership Retained group/ interest Total
capital reserve reserve reserve* income company (“NCI”) equity
UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY R R R R R R R R
Balance at 1 July 2012 8 649 001 1 146 235 6 695 567 16 490 803 7 203 283 23 694 086
Total comprehensive loss for the period (4 514 103) (4 514 103) (4 067 819) (8 581 922)
Issue of shares 30 508 123 30 508 123 30 508 123
Exchange differences on translating foreign operations 231 438 231 438 231 438
Balance at 31 December 2012 39 157 124 231 438 - 1 146 235 2 181 464 42 716 260 3 135 464 45 851 724
Balance at 1 July 2013 378 980 824 671 551 975 992 (9 023 778) 18 734 286 390 338 875 347 663 390 686 538
Total comprehensive income for the period 53 920 397 53 920 397 1 763 345 55 683 742
Issue of shares 659 959 140 659 959 140 659 959 140
Exchange differences on translating foreign operations 462 875 462 875 462 875
Dividends - (317 994) (317 994)
Listing fees capitalised (18 596 225) (18 596 225) (18 596 225)
Treasury shares held for payments of acquisitions (15 290 875) (15 290 875) (15 290 875)
Changes in ownership interest - control not lost (59 889 912) (59 889 912) (1 378 516) (61 268 428)
NCI allocation on acquisition - 1 575 156 1 575 156
Balance at 31 December 2013 1 005 052 864 1 134 426 975 992 (68 913 690) 72 654 683 1 010 904 276 1 989 654 1 012 893 929
Notes
* Change of ownership reserve represents the cumulative difference between the total consideration paid and the
proportionate share of the non-controlling interest purchased or sold in transactions with equity participants where control
of the subsidiary is not lost or gained.
* The group listed on the Main Board of the JSE on 22 November 2013 and capitalised the allowable costs that are capital in
nature against the capital raised
Unaudited Condensed Group Unaudited Unaudited Audited
Statement of Cash Flows Six months ended Six months ended Year ended
31 Dec 31 Dec 30 Jun
2013 2012 2013
R R R
Cash flows from operating activities
Cash (used in)/generated from operations (71 215 236) (53 952 237) 7 222 265
Net finance costs (9 150 496) (12 701 785) (52 053 405)
Dividends paid - - (679 800)
Tax paid (5 383 971) (12 289 739) (10 678 995)
Net cash from operating activities (85 749 704) (78 943 762) (56 189 935)
Cash flows from investing activities
Purchase of property, plant and equipment - - (3 969 297)
Sale of property, plant and equipment 102 929 1 270 362 326 076
Purchase of other intangible assets - - (1 840 657)
Business combinations (427 033 371) (8 103 119) (101 811 962)
Change in ownership (39 547 079) - (10 989 450)
Acquisition of investments in joint venture (17 055 504) - -
Net movement in loans receivable - - 3 408 448
Dividends received - - -
Net cash from investing activities (478 746 910) (6 832 7569) (114 876 842)
Cash flows from financing activities
Proceeds on share issue 400 000 000 - 370 331 823
Proceeds from other financial liabilities (828 638) (601 029)
Repayment of other financial liabilities - - (6 607 774)
Movement in redeemable preference shares - (14 677 231) (14 677 231)
Repayment of deferred vendor liabilities - - (10 867 534)
Finance lease payments 961 912 (607 402) (359 997)
Net cash movement from borrowing activities 268 108 439 105 960 684 (69 418 388)
Net cash from financing activities 668 241 713 90 075 022 268 400 899
Total cash movement for the period 103 745 100 4 298 504 97 334 122
Cash at the beginning of the period 134 983 928 27 884 039 26 912 500
Total cash at end of the period 238 729 028 32 182 543 134 983 928
Cash (used in)/generated from operations
Profit/(loss) before taxation 78 427 805 (4 328 242) 10 236 710
Adjustments for:
Depreciation and amortisation 14 279 407 3 917 071 9 500 933
Profit on sale of assets 109 490 173 853 (223 359)
Loss on foreign exchange 462 875 231 438 671 551
Net finance costs 9 150 496 12 701 785 46 543 560
Impairment loss - 2 384 890 208 900
Movements in operating lease assets and accruals - - 227 609
Changes in working capital:
Inventories (125 057 230) (3 687 173) (19 998 638)
Trade and other receivables (150 361 277) (50 216 618) (50 672 214)
Trade and other payables 151 773 288 (15 129 241) 10 727 213
(71 215 236) (53 952 237) 7 222 265
Tax paid
Balance at beginning of the period (3 429 671) (607 143) (607 143)
Current tax for the period recognised in profit or loss (9 463 109) (12 131 943) (10 494 451)
Adjustment in respect of businesses sold and acquired during the
period including exchange rate movements (5 920 643) (1 503 536) (3 007 072)
Balance at end of the period 13 429 451 1 952 882 3 429 671
(5 383 971) (12 289 739) (10 678 995)
Unaudited Condensed Group Unaudited Unaudited Audited
Segmental Analysis Six months ended Six months ended Year Ended
31 Dec 31 Dec 30 Jun
2013 2012 2013
R R R
Operating segments
Revenue
The revenue of Ascendis Health is predominantly earned in
southern Africa.
Revenue split by division
Consumer Brands 299 291 821 117 089 740 260 608 802
Phyto-Vet 292 198 693 192 553 557 352 839 000
Pharma-Med 70 411 000 - -
Total revenue 661 901 513 309 643 297 613 447 802
Geographical revenue split
South African 558 357 678 276 090 257 513 171 642
Foreign 103 543 835 33 553 040 100 276 160
Total revenue 661 901 513 309 643 297 613 447 802
Currently there are no intersegmental sales between operating
segments within the group.
EBITDA
Consumer Brands
Operating profit 61 872 880 18 653 894 31 601 821
Amortisation and depreciation 8 640 693 - 2 303 940
Impairment of assets - - 208 907
Consumer Brands EBITDA 70 513 573 18 653 894 34 114 668
Phyto-Vet
Operating profit 33 958 182 2 864 387 31 193 300
Amortisation and depreciation 5 280 714 - 4 561 700
Phyto-Vet EBITDA 39 238 896 2 864 387 35 755 000
Pharma-Med
Operating profit 2 577 956 - -
Amortisation and depreciation (38 018) - -
Pharma-Med EBITDA 2 539 938 - -
Head office adjustments (10 713 524) 2 478 523 (3 772 471)
Total EBITDA 101 578 883 23 996 805 66 097 197
Segmental assets and liabilities
Consumer Brands
- Total assets 665 628 644 193 894 288 283 263 700
- Total liabilities (87 830 898) (74 938 261) (112 686 588)
Consumer Brands net asset value 577 797 746 118 956 028 170 577 112
Phyto-Vet
- Total assets 489 018 494 403 664 866 434 034 443
- Total liabilities (132 311 879) (372 008 726) (411 395 883)
Phyto-Vet net asset value 356 706 616 20 026 284 22 638 560
Pharma-Med
- Total assets 381 444 453 - -
- Total liabilities (187 749 924) - -
Pharma-Med net asset value 193 694 530 - -
Unaudited Unaudited Audited
Unaudited Earnings Per Share Six months ended Six months ended Year ended
31 Dec 31 Dec 30 Jun
2013 2012 2013
R R R
Earnings per share is calculated by dividing earnings attributable to
the parent by the weighted average number of ordinary shares in
issue during the financial period.
Appropriate adjustments are made to earnings per share in order
to calculate headline earnings per share.
Shares in issue 229 735 527 13 096 20 827
Treasury shares (1 143 942)
Total shares in issue net of treasury shares 228 591 585 13 096 20 827
Weighted average number of shares 184 581 045 12 553 12 869
Weighted average number of shares
Shares in issue at the beginning of the period 175 778 937 12 009 11 498
Shares issued during the period net of treasury shares 8 802 108 544 1 371
Weighted average number of shares 184 581 045 12 553 12 869
Reconciliation between earnings and headline earnings
Earnings attributable to ordinary shareholders 53 920 397 (4 514 103) 12 038 719
Adjusted for:
Gain on sale of property, plant and equipment (102 929) (1 270 362) (223 359)
Tax effect thereof 28 820 355 701 62 541
Impairment of intangible asset 2 384 890 208 907
Tax effect thereof (667 769) (58 494)
Headline earnings 53 846 288 (3 711 643) 12 028 314
Reconciliation between weighted average number of shares and
diluted weighted average number of shares
Weighted average number of shares before dilution 184 581 045 12 553 12 869
Shares to be issued to vendors 3 633 609 564 105
Weighted average number of shares after taking into account the
effect of the dilutive potential ordinary shares* 188 214 654 13 117 12 974
Reconciliation between weighted average number of shares and
diluted weighted average number of shares: Cents Cents Cents
Basic earnings per share (cents) 29 (35 960) 93 548
Diluted earnings per share (cents) 29 (34 415) 92 791
Basic headline earnings per share(cents) 29 (29 568) 93 467
Diluted headline earnings per share (cents) 29 (28 297) 92 711
*The group performed a 1: 8 000 share split during 2013 to prepare itself
for listing
Prior period normalised for share split: Cents Cents Cents
Basic earnings per share (cents) 29 (4) 12
Diluted earnings per share (cents) 29 (4) 12
Basic headline earnings per share(cents) 29 (4) 12
Diluted headline earnings per share (cents) 29 (4) 12
NOTES TO THE UNAUDITED CONDENSED
CONSOLIDATED INTERIM FINANCIAL STATEMENTS
1. Corporate information
Ascendis is a fast growing health and care brands company consisting of three divisions, Consumer Brands
(nutraceuticals, vitamins, sports nutrition and skin care products); Phyto-Vet (plant and animal health); and
Pharma-Med (prescription drugs and medical devices). The group's vision, which is encapsulated in its motto 'A
healthy home and a healthy you', is to bring health to the consumer at all stages of his or her life - from health
maintenance (preventative medicine) to chronic medication and critical care (intervention). These condensed
group interim financial results as at and for the six months ended 31 December 2013 comprise of the company
and its subsidiaries (together referred to as the group) and the group's interest in joint ventures.
2. Basis of preparation
Statement of compliance
The unaudited condensed group interim financial results for the six-month period ended 31 December 2013
have been prepared under the supervision of RJ Taylor (CA) Z, in accordance with International Accounting
Standard (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee, the Listings Requirements of the Johannesburg Stock Exchange (JSE),
Financial Pronouncements as issued by the Financial Reporting Standards Council and the requirements of the
South African Companies Act No 71 of 2008. The condensed unaudited group interim financial results should
be read in conjunction with the audited group annual financial statements as at and for the year ended 30 June
2013 and the company's Pre-listing statement which was prepared for listing on the Main Board of the JSE on
22 November 2013, which have been prepared in accordance with International Financial Reporting Standards
(IFRS) as issued by the International Accounting Standards Board (IASB).
3. Significant accounting policies
IAS 27 Consolidated financial statements (revised) 1 January 2013
IAS 28 Investments in associates and joint ventures (revised) 1 January 2013
IFRS 10 Consolidated financial statements (revised) 1 January 2013
IFRS 11 Joint arrangements (as amended) 1 January 2013
IFRS 12 Disclosure of interest in other entities (as amended) 1 January 2013
IFRS 13 Fair value measurement 1 January 2013
IFRS 9 Financial Instruments 1 January 2015
The adoption of these amendments to standards and interpretations did not have any material impact on the
group's results and cash flows for the six months ended 31 December 2013.
4. Business combinations
During the period under review the following businesses have been acquired and accounted for on the
acquisition basis:
Pharma-Med Division
On 1 November 2013 the group acquired 100% of Pharmachem Group which collectively consists of: Dezzo,
MDI, Pharmachem Pharmaceuticals. The company specialises in marketing and distribution of its own branded
generic pharmaceuticals, nutraceuticals and OTC products.
Phyto-Vet Division
On 1 October 2013 the group acquired 100% of Marlton's Pets and Products Proprietary Limited. The company
specialises in pet care and accessories, expanding into retail chains and pet/vet stores.
Consumer Brands Division
On 5 July 2013 the group acquired 100% of SOLAL Technologies Proprietary Limited including its two
subsidiaries Solal Technologies Proprietary Limited ('Solal Anti Aging') and Integrative Medical Centre CC. The
company specialises in preventive and healthy ageing products, offering solutions to most health problems
and anti-ageing needs.
On 25 July 2013 the group acquired 100% of Nimue Skin South Africa Proprietary Limited, the distribution
company of Nimue Skin Care Products which has since evolved into a globally recognised brand, primarily
amongst leading skin care salons.
On 1 November 2013 and 1 October 2013 the group acquired 100% of Dealcor Forty Proprietary Limited,
trading under the brand of Evox, and Bolus Distribution Proprietary Limited, trading as Muscle Tech. Both
companies specialise in sports nutrition products for active lifestyle consumers and professional athletes.
On 1 November 2013 the group acquired 74% of Sceniwell Proprietary Limited and Swissgarde South Africa
Proprietary Limited, both incorporated in South Africa. The main business of these companies is direct selling
of nutraceutical and home care products with a strong network in South Africa and Nigeria. At acquisition the
non-controlling interest recognised is R1 575 156.
Consumer
Brands Pharma-Med Phyto-Vet Total
R R R R
Consideration 398 500 500 153 301 300 24 423 151 576 224 951
Net asset value 124 596 608 44 236 300 11 234 953 180 067 862
Goodwill 273 903 892 109 065 000 13 188 198 396 157 089
Net cash consideration paid 346 819 077 75 762 177 4 452 117 427 033 371
Contribution to revenue since acquisition 141 867 276 70 411 000 51 383 646 263 661 922
Contribution to profit since acquisition 17 427 442 1 990 334 712 532 20 130 308
The goodwill arising out of the transaction will be attributable to the significant synergies expected to arise
after the company's acquisition into the group.
A preliminary allocation between goodwill and intangibles was performed based on management's estimates.
The full Purchase Price Allocation process will be completed after December 2013, which is within the
12 month allocation period allowed by IFRS 3.
Investments in joint ventures
Joint ventures are all entities over which the group has significant influence but not control, generally
accompanying a shareholding of between 20% and 50% of the voting rights. Investments in joint ventures are
accounted for using the equity method of accounting and are initially recognised at cost. The group's investment
in joint ventures includes goodwill identified on acquisition, net of any accumulated impairment loss. The
group's share of its joint ventures' post-acquisition profits or losses is recognised in the income statement,
and its share of post-acquisition movements in reserves is recognised in other comprehensive income. The
cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When
the group's share of losses in an joint venture equals or exceeds its interest in the joint venture, including any
other unsecured receivables, the group does not recognise further losses, unless it has incurred obligations or
made payments on behalf of the joint venture. Unrealised gains on transactions between the group and its
Joint ventures are eliminated to the extent of the group's interest in the joint ventures. Unrealised losses are
also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting
policies of joint ventures have been changed where necessary to ensure consistency with the policies adopted
by the group. Dilution gains and losses arising in investments in joint ventures are recognised in the income
statement. The group owns 100% of the shares in Atka Pharma but only participates in 50% of the effective
rights to control this venture. The group has every confidence in the co-operative management relationship.
Name Country of Division Investment Profit/loss Control
incorporation exercised
Atka Pharma South Africa Consumer Brands R 52 500 000 - 50%
Dividends
No dividends have been declared by Ascendis Health Limited for the 6 months ending 31 December 2013.
Transactions with non-controlling interests
During July 2013 and November 2013, the group acquired the remaining 15% of Efekto Holdings Proprietary
Limited and its subsidiaries and 20% of Chempure Proprietary Limited for a purchase consideration of R39
547 079 and R21 721 349 respectively. The group now holds 100% of the equity share capital of Efekto Holdings and
its Subsidiaries and Chempure. The carrying amount of the non-controlling interest in Efekto Holdings and
Chempure on the date of acquisition was (R2 620 016) and R 3 998 532. The group derecognised non-
controlling interests of and recorded a decrease in equity attributable to owners of the parent. The effect of
changes in the ownership interest in Efekto Holdings and Chempure on the equity attributable to owners of
the company during the period is summarised as follows:
Unaudited
Six months
ended
31 Dec
2013
Carrying amount of non-controlling interests acquired 1 378 516
Excess of consideration paid recognised in parent's equity 59 889 912
Consideration paid for non-controlling interest 61 268 428
Related party transactions
During the period the company and its subsidiaries, in the ordinary course of business, entered into various
sale and purchase transactions with joint ventures. These transactions were subject to terms that are no less
or more favourable than those arranged with third parties.
Going concern
After taking into account the current economy, the group's liquidity position as well as internal budgets and
forecasts for the short- to medium-term, it is expected that the group will continue to trade as a going concern
within the next 12 months.
JSE Limited Listings Requirements
The interim results announcement has been prepared in accordance with the Listings Requirements of the JSE
Limited.
Corporate governance
Detailed disclosure of the company's application of the principles contained in the King Report on Governance
for South Africa 2009 (King III) was made in the 2013 Pre-listing Statement and is available on the company's
website in accordance with the JSE Listings Requirements. No material changes have occurred since the
disclosure. Efforts are constantly employed to address the areas requiring improvement. The classification of
the independence of the non-executive directors is currently under review and could potentially change in the
short term. Please contact the Group Company Secretary, Pieter van Niekerk, for any additional information
in this regard.
Events after the reporting period
Debt
Borrowings of R40 million were incurred from Mr Stavros Vizirgianakis, a related party who was previously a
major shareholder of Surgical Innovations. The loan bears interest at 13% per annum and this interest shall be
compounded at the end of the last day of each month. The loan is repayable in one bullet payment on the
maturity date of 30 June 2014.
Acquisition of Surgical Innovations
On 17 January 2014 the group got approval from the Competition Commission for the acquisition of Surgical
Innovations CC for a total consideration of R336 million. Surgical Innovations CC imports, markets and
distributes surgical and medical devices, and gives the group a footprint within the medical devices market.
This acquisition will form part of the Pharma-Med division within the group.
Advanced negotiations regarding the PharmaNatura Proprietary Limited acquisition
The group is currently engaged in advanced negotiations with PharmaNatura to acquire the business, this is
still subject to certain conditions precedent, of which the most important is pending Competition Commission
approval.
Contingent liabilities
There are no additional contingent liabilities since the reporting period ended on 30 June 2013.
Audit
These results have not been audited or reviewed by the external auditors.
Corporate Information
Ascendis Health Limited
Registration number 2008/005856/06
JSE share code ASC
ISIN ZAE000185005
Registered office The Terraces, Block E, Steenberg Office Park, Silverwood Close, Tokai, 7945
Private Bag X26, Tokai, 7966
Contact details +27 (0)21 701 2232 / info@ascendis.co.za
Sponsor Nedbank Capital
Auditors PricewaterhouseCoopers Inc
Transfer secretaries Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Company secretary Pieter van Niekerk CA (SA)
Directors J Bester (Chairman)*
Dr KUHH Wellner (CEO)
RJ Taylor (CFO)
B Harie*
CD Dillon#
GJ Shayne#
OP Cunningham*
* Independent non-executive # Non-executive
www.ascendis.co.za
Date: 03/03/2014 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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