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Audited Preliminary Summarised Consolidated Financial Results for the year ended 31 December 2013
ILIAD AFRICA LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1997/011938/06
Share code ILA ISIN:ZAE000015038
ILIAD AFRICA LIMITED
Audited Preliminary Summarised Consolidated Financial Results for the year ended 31 December 2013
HIGHLIGHTS
- HEPS increase in H2 51,0%
- Revenue from future
portfolio 4.1%
- EBITDA before
restructuring costs 1,9%
- Year-on-year increase
in cash R115,7m
Nature of Business
Iliad Africa Limited, listed on the JSE in 1998, focuses on sourcing, distributing, wholesaling and retailing
general and specialised building materials. The Group operates through two focused divisions leveraging
common pools of expertise, enabling each division to focus on its core market. General Building Materials
(GBM) markets a comprehensive range of products primarily sourced locally. Specialised Building Materials
(SBM) trades in differentiated and value-added products. A range of customers, from large-scale development
and construction groups to do-it-yourself homeowners are serviced country-wide from an established base of
74 stores.
Financial Review
In line with the trading statement issued on 13 February 2014, the Group reported a major second half
performance improvement on the comparable period. This performance reflects the benefits of the portfolio
adjustments, with the second half HEPS at 39,6 cents per share, an improvement of 13,3 cents per share
on the comparable period. The Group recorded a full year earnings loss of 4,8 cents per share, compared
to earnings of 24,3 cents per share for 2012. Earnings include once-off restructuring costs of R 14,7 million
(2012: RNil), loss on disposal of business components of R15,2 million (2012: RNil) and fair value adjustments
on available-for-sale assets of R70,2 million (2012: RNil) relating to the disposals of the components of the
Ceramics Cash & Carry, Ceramics and Timber Wholesale businesses. Excluding these once-off portfolio
rationalisation and impairment charges, the Group recorded an EBITDA of R 149,2 million for the year ended
31 December 2013, compared to R 146,5 million for the 2012 year.
The impact of the portfolio adjustments on the results are as follows:
Revenue Profitability (EBITDA)*
% 31 December 31 December % 31 December 31 December
change 2013 (Rm) 2012 (Rm) change 2013 (Rm) 2012 (Rm)
Future portfolio 4,1 4 271 4 104 (2,2) 177 181
Affected portfolio (50,4) 193 389 (19,1) (28) (35)
Total (0,6) 4 464 4 493 1,9 149 146
*EBITDA before portfolio adjustments.
Group revenue on the future portfolio increased by 4,1%, mainly due to an encouraging performance by the
Coastal region of the GBM division and the SBM division. The rest of the Group reflects the continued subdued
trading environment, marginal recovery in building plans passed and the protracted slowdown in the finishing
end of the industry.
Year-on-year expenses (excluding once-off portfolio adjustment costs and intangible asset impairments and
depreciation) have decreased by 1,9%, reflecting the impact of various disposals and the focus on
expense management in order to partially negate costs associated with investing in key strategic initiatives.
The Group ended the year with net cash of R38,8 million, compared to net overdraft of R76,9 million at the
end of 2012. The improvement is mainly due to the proceeds on disposals and increased focus on working
capital. By year end, the Group has repurchased 1.16% of total shares at an average price of 546 cents to be
held as treasury shares.
Operational and Market Review
The past few years have been challenging for the building material supply industry. Iliad's ongoing focus on
procurement and improving cost structures has countered these conditions to some extent.
Against this background and as part of our portfolio review to maintain the strategic balance of the Group's
national footprint, the decision had been made to sell components of our Ceramics Cash & Carry, Ceramics and
Timber Wholesale businesses. These disposals have now been fully implemented.
Iliad's GBM division produced a mixed performance under these circumstances. The Inland subdivision
recorded muted results with a 2,0% increase in revenue, and the Coastal subdivision delivered a 3,4% revenue
increase.
The SBM division reported a satisfactory 8,5% revenue increase for the future portfolio.
Prospects
This industry continues to adjust to changing trading conditions in a competitive environment. The infrastructural
efficiencies implemented during the year, stringent performance targets, realignment of the portfolio and
implementation of various key strategic initiatives ensure the Group is well positioned to capitalise on
opportunities as growth gradually returns to the market. The first eight weeks since financial year end reflected
an increase in revenue of approximately 5,8% on that of the comparable eight weeks of 2013.
Changes to the Board
During the period under review, Mr Howard Turner retired as Chairman and Director of the Board and Mr Andile
Sangqu was appointed as both non-executive Director (effective 1 March 2013) and Chairman (effective 23
May 2013).
Basis of preparation
The preliminary summarised consolidated financial results included in this announcement have been prepared
in accordance with the measurement and recognition criteria of International Financial Reporting Standards
("IFRS") and its interpretations adopted by the International Accounting Standards Board in issue and effective
for the Group at 31 December 2012 and the SAICA Financial Reporting Guides as issued by the Accounting
Practices Committee and the Financial Reporting pronouncements as issued by the Financial Reporting
Standards Council. The results are presented in terms of IAS 34, Interim Financial Reporting, and comply with
the Listing Requirements of the JSE Limited and the Companies Act, 2008. These preliminary summarised
consolidated financial results do not include all the information required for a set of full annual financial
statements and should be read in conjunction with the consolidated annual financial statements that the Board
of Directors approved on 6 March 2014.
The preparation of the Group's consolidated financial results for the year ended 31 December 2013 was
supervised by the Chief Financial Officer: Chris Booyens CA (SA).
Accounting Policies
The accounting policies adopted in the preparation of the preliminary consolidated annual financial statements
are in terms of IFRS and are consistent with those applied in the Group annual financial statements for the year
ended 31 December 2012, except for the adoption of new or revised accounting standards and interpretations,
that became applicable during the current reporting period. None of these have had a significant impact on the Group's accounting policies and methods of computation, nor have they resulted in a restatement or re-
presentation of the 31 December 2012 statement of financial position and related notes.
Events after the reporting date
There have been no material events after the reporting date.
Audit Opinion
The Group's external auditors, Deloitte & Touche, have issued their unmodified opinions on the Group annual
financial statements and summarised consolidated annual financial statements for the year ended 31 December
2013. The audit was conducted in accordance with International Standards on Auditing. These summarised
consolidated financial statements have been derived from the Group annual financial statements and are
consistent in all material respects with the Group annual financial statements. A copy of both opinions are
available for inspection at the registered offices of Iliad Africa Limited.
Any reference to future financial performance included in this announcement, has neither been reviewed nor is it
reported on by the Company's external auditors.
Dividend to owners of the Parent
The Group has declared a final dividend of 20 cents per share (2012: 20 cents per share) for the 12 month period
ended 31 December 2013.
The dividend is payable from income reserves. Iliad has no secondary tax on companies credits available to cover
the South African dividend tax (DT) of 15% on shareholders not exempt. The net amount payable to shareholders
who are not exempt from DT is 17 cents per share, while it is 20 cents per share to those shareholders who are
exempt from DT. The issued share capital at the declaration date is 138 217 794 ordinary shares. Iliad Africa
Limited's tax reference number is 9269/002/71/4.
Set out below are the salient dates applicable to the dividend:
Last date to trade "cum dividend" Wednesday, 23 April 2014
Trading commences "ex dividend" Thursday, 24 April 2014
Record date Friday, 2 May 2014
Payment date Monday, 5 May 2014
Share certificates may not be dematerialised or rematerialised between Thursday, 24 April 2014 and Friday, 2
May 2014, both dates inclusive.
For and on behalf of the Board of Directors.
6 March 2014, Johannesburg
Andile Sangqu Eugene Beneke Chris Booyens
Independent Non-executive Chairman Chief Executive Officer Chief Financial Officer
SUMMARISED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited Audited
R'000 2013 2012
ASSETS
Non-current assets
Property, plant and equipment 140 309 134 158
Intangible assets 232 881 234 161
Non-current financial assets 6 074 –
Deferred taxation 48 849 43 933
Total non-current assets 428 113 412 252
Current assets
Inventories 609 246 694 452
Trade and other receivables 459 817 461 581
Taxation – 15 866
Cash and cash equivalents 48 515 212 958
Short-term portion of financial assets 22 131 –
Assets classified as held-for-sale – 72 711
Total current assets 1 139 709 1 457 568
Total assets 1 567 822 1 869 820
EQUITY AND LIABILITIES
Equity
Ordinary share capital 122 122
Retained income 746 621 789 826
Equity attributable to owners of the parent 746 743 789 948
Non-controlling interest – –
Total equity 746 743 789 948
Non-current liabilities
Long-term borrowings 5 592 3 971
Total non-current liabilities 5 592 3 971
Current Liabilities
Trade and other payables 801 890 757 355
Bank overdraft 9 732 289 875
Taxation 1 341 –
Short-term borrowings 2 524 1 503
Liabilities classified as held-for-sale – 27 168
Total current liabilities 815 487 1 075 901
Total equity and liabilities 1 567 822 1 869 820
SUMMARISED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Audited Audited
R'000 2013 2012
Revenue 4 464 056 4 493 085
Cost of sales 3 272 662 3 283 864
Gross margin 1 191 394 1 209 221
Administration, selling and distribution expenses 1 042 179 1 062 727
EBITDA before restructuring costs 149 215 146 494
Loss on disposal of business assets 15 197 –
Fair value adjustments on available-for-sale assets 70 232 –
Restructuring costs 14 699 –
EBITDA 49 087 146 494
Depreciation 40 900 38 618
Amortisation of intangibles 1 280 2 523
Intangible impairments – 30 419
Operating profit before investment income (EBIT) 6 907 74 934
Investment income 16 335 18 591
Operating profit before finance charges 23 242 93 525
Finance charges (30 752) (29 919)
(Loss)/profit before taxation (7 510) 63 606
Taxation 919 (29 963)
(Loss)/profit for the year (6 591) 33 643
Other comprehensive income for the year – –
Total comprehensive (loss)/income for the year (6 591) 33 643
Attributable to:
Non-controlling interest – –
Owners of the parent (6 591) 33 643
(6 591) 33 643
Headline Earnings Reconciliation
Attributable to owners of the parent (6 591) 33 643
Adjusted for:
Impairments of intangibles – 30 419
Loss/(profit) on disposal of property, plant and equipment (net of tax) 382 (103)
Fair value adjustments on available-of-sale assets (net of tax) 50 567 –
Loss on disposal of components of businesses (net of tax) 10 942 –
Headline earnings for the year 55 300 63 959
Ordinary shares in issue at year end (excl. treasury shares) 136 612 229 138 217 794
Weighted average number of ordinary shares 138 140 011 138 217 794
Basic and diluted (loss)/earnings per share (cents) (4,8) 24,3
Headline earnings per share (cents) 40,0 46,3
Dividends to owners of the parent (cents per share) 20,0 20,0
SUMMARISED CONSOLIDATED STATEMENT OF CASH FLOWS
Audited Audited
R'000 2013 2012
Cash flows from operating activities 140 039 (30 334)
Operating profit adjusted for non-cash items 135 183 137 994
Working capital changes (8 355) (121 336)
Taxation paid 13 211 (46 992)
Cash flows from investing activities 14 316 (68 562)
Cash flows from financing activities (38 655) (26 239)
Net increase/(decrease) in cash and cash equivalents for the year 115 700 (125 135)
Cash and cash equivalents at the beginning of the year (76 917) 48 218
Cash and cash equivalents at end of the year 38 783 (76 917)
SUPPLEMENTARY INFORMATION
Audited Audited
R'000 2013 2012
Net asset value per share (cents) 546,6 571,5
Net tangible asset value per share (cents) 376,1 402,1
Proceeds on disposal of business assets (R'000) 63 880 –
Capital commitments (R'000)
–approved and contracted 691 4 477
–approved not contracted 59 180 48 028
Depreciation 40 900 38 618
SUMMARISED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Audited Audited
R'000 2013 2012
Total equity at the beginning of the year 789 948 783 949
Movement in retained (loss)/income (43 205) 5 999
Attributable to owners of the parent (6 591) 33 643
Treasury shares (8 970) –
Dividends to owners of the parent (27 644) (27 644)
746 743 789 948
SUMMARISED CONSOLIDATED SEGMENT REPORT
Group General Building Materials Specialised Building Materials
Audited Audited Audited Audited Audited Audited
R'000 2013 2012 2013 2012 2013 2012
Revenue 4 464 056 4 493 085 3 540 396 3 454 283 923 660 1 038 802
EBITDA before restructuring costs 149 215 146 494 106 214 116 351 43 001 30 143
Loss on disposal of business assets 15 197 – – – 15 197 –
Fair value adjustments on available-for-sale assets 70 232 – – – 70 232 –
Restructuring costs 14 699 – 14 699 – – –
EBITDA 49 087 146 494 91 515 116 351 (42 428) 30 143
Depreciation and amortisation 42 180 41 141 27 400 22 050 14 780 19 091
Impairments – 30 419 – – – 30 419
EBIT 6 907 74 934 64 115 94 301 (57 208) (19 367)
Total assets 1 567 822 1 869 820 1 003 012 1 080 926 564 810 788 894
Total liabilities 821 079 1 079 872 515 611 640 269 305 468 439 603
Capital expenditure 54 074 71 242 37 194 45 758 16 880 25 484
CORPORATE INFORMATION
Iliad or the Group (Incorporated in the Republic of South Africa) Registered number 1997/011938/06.
Share code ILA ISIN ZAE000015038.
Registered address Iliad House Block 7 Thornhill Office Park 94 Bekker Road Midrand
Postnet Suite 566 P/Bag x 29 Gallo Manor 2052
Directors AH Sangqu (Chairman)* E Beneke (Chief Executive Officer) CP Booyens (Chief
Financial Officer) T Njikizana* RT Ririe* Prof F Abrahams* S Kalyan*
*Non-executive
Group Secretary SC O'Connor
Transfer secretaries Link Market Services South Africa (Pty) Limited 13th Floor Rennie House
19 Ameshoff Street Braamfontein 2001
PO Box 4844 Johannesburg 2000
Sponsor Bridge Capital Advisors (Pty) Ltd 27 Fricker Road Second Floor Illovo 2196
PO Box 651010 Benmore 2010
www.iliadafrica.co.za
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