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Condensed Group Audited Results for the year ended 28 February 2014
Spanjaard Limited
(Incorporated in the Republic of South Africa)
Registration number 1960/004393/06
Share code: SPA ISIN: ZAE000006938
("Company" or "Group")
CONDENSED GROUP AUDITED
RESULTS FOR THE YEAR ENDED
28 FEBRUARY 2014
CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND COMPREHENSIVE INCOME
Year ended Year ended
28 February 28 February
2014 2013
Restated
R'000 R'000
Revenue 113 766 109 515
Turnover 111 861 108 347
Cost of sales (72 109) (65 303)
Gross profit 39 752 43 044
Operating expenses (32 171) (32 540)
Depreciation and amortisation (2 569) (2 660)
Finance (cost)/income – net (1 235) (1 437)
Profit before tax 3 777 6 407
Income tax expense (1 416) (1 970)
Profit from continuing operations 2 361 4 437
Discontinued operations
Profit from discontinued operations 97 (402)
Profit for the year 2 458 4 035
Other comprehensive income
Items that will be reclassified
Movement in foreign currency translation reserve 60 (508)
Items that will not be reclassified
Profit/(Loss) on revaluation on property,
plant and equipment 459 (436)
Tax effect (85) –
Total comprehensive income for the year 2 892 3 091
Earnings and diluted earnings per ordinary share 19,1 50,0
– Continuing operations 17,9 54,9
– Discontinued operations 1,2 (4,9)
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at As at
28 February 28 February
2014 2013
Restated
R'000 R'000
Assets
Non-current assets 30 160 35 755
Property, plant and equipment 28 800 34 237
Goodwill 437 437
Intangibles 923 1 081
Current assets 39 022 36 220
Non-current assets held for sale 3 759 –
Total assets 72 941 71 975
Equity and liabilities
Capital and reserves attributable to the Company's
equity holders 42 553 41 860
Ordinary shares and premium 6 871 6 871
Reserves 35 682 34 989
Non-current liabilities 9 377 10 897
Borrowings 4 253 5 873
Deferred tax liabilities 5 124 5 024
Current liabilities 21 011 19 218
Total equity and liabilities 72 941 71 975
CONSOLIDATED STATEMENT OF CASH FLOW
Year ended Year ended
28 February 28 February
2014 2013
R'000 R'000
Cash flows from operating activities (3 018) 2 732
Cash flows from investing activities 1 093 1 811
Cash flows from financing activities (1 616) (2 703)
Net (decrease)/increase in cash and cash equivalents (3 541) 1 840
Cash and cash equivalents at beginning of year 3 318 1 478
Cash and cash equivalents at end of year (223) 3 318
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
As at As at
28 February 28 February
2014 2013
R'000 R'000
Ordinary shares 407 407
Share premium 6 464 6 464
Foreign currency translation reserve (541) (601)
Opening balance (601) (93)
Movement for the year 60 (508)
Revaluation reserve 8 082 8 296
Opening balance 8 296 9 630
Movement for the year (214) (1 334)
Retained earnings 28 141 27 294
Opening balance 27 294 24 397
Total comprehensive income for the year 847 2 897
Total shareholders' equity 42 553 41 860
DIVIDENDS
Dividend declared per ordinary share (cents)
– interim 15,0 15,0
– final 12,0 10,0
SUPPLEMENTARY INFORMATION
Year ended Year ended
28 February 28 February
2014 2013
R'000 R'000
Capital expenditure 2 210 1 536
RECONCILIATION OF HEADLINE EARNINGS
Year ended Year ended
28 February 28 February
2014 2013
Continuing operations R'000 R'000
Profit attributable to shareholders 2 361 4 437
Loss on disposal of property, plant and equipment (1 258) 51
Income tax effect on disposal 352 (14)
Headline earnings 1 455 4 474
Weighted average number of ordinary shares
in issue ('000) 8 143 8 143
Headline earnings per ordinary share
– basic and diluted (cents) 17,9 54,9
Discontinued operations
Profit attributable to shareholders 97 (402)
Headline earnings 97 (402)
Weighted average number of ordinary shares
in issue ('000) 8 143 8 143
Headline earnings per ordinary share
– basic and diluted (cents) 1,2 (4,9)
OPERATING SEGMENTS
Year ended Year ended
28 February 28 February
2014 2013
R'000 R'000
Segment revenue
Special lubricants and allied chemical products 106 864 103 404
External foreign customers 18 076 13 780
External local customers 88 788 89 624
Metal powders 6 675 8 551
External foreign customers 3 572 4 636
External local customers 3 103 3 915
Other 3 750 3 011
External foreign customers 3 750 3 011
Reconciling items (5 428) (6 619)
Inter segment sales (5 428) (6 619)
111 861 108 347
OPERATING SEGMENTS (continued)
Year ended Year ended
28 February 28 February
2014 2013
R'000 R'000
Segment result
Special lubricants and allied chemical products 2 862 4 105
Metal powders 1 249 419
Other 12 (1 192)
Reconciling items 889 4 512
5 012 7 844
Segment assets
Special lubricants and allied chemical products 57 762 50 312
Metal powders 11 558 9 951
Other 25 193 24 790
Reconciling items (21 572) (13 078)
72 941 71 975
Segment liabilities
Special lubricants and allied chemical products 29 395 21 602
Metal powders 1 896 1 702
Other 20 720 18 329
Reconciling items (21 623) (11 518)
30 388 30 115
BASIS OF PREPARATION
The audited condensed consolidated results have been prepared using the measurement and
recognition requirements of the International Financial Reporting Standards (IFRS), the South
African Institute of Chartered Accountants (SAICA) Financial Reporting Guides as issued by the
Accounting Practices Committee and in the manner required by the South African Companies
Act, 71 of 2008. The accounting policies and methods of computation are consistent with those
of the Annual Financial Statements. This abridged report is extracted from audited financial
information but is not itself audited. The directors take full responsibility for the preparation of
the abridged report and that the financial information has been correctly extracted from the
underlying financial statements.
The condensed financial statements should be read in conjunction with the 2014 financial
statements. The 2014 annual financial statements and the related audit report can be viewed on
the Company's website at www.spanjaard.biz.
The annual financial statements, on which this report is based, were audited in terms of the
Companies Act, 71 of 2008.
Condensed group audited results prepared by: HJ van Heerden – BCom (Acc).
Condensed group audited results date of publication – 29 May 2014.
COMMENTARY
POINTS OF INTEREST
- Net asset value increased from 514,1 cents to 522,6 cents
per ordinary share
- Total gross cash dividend declared for the 2014 financial year
totalled 27 cents (2013: 25 cents)
This year we faced some important financial and operational challenges.
The high increases in energy, labour and fuel costs continue to negatively impact
manufacturing industries leading to a decline in our gross margin.
The Group reported a profit after tax of R2 458 million (2013: R4 035 million) for the
financial year ended 28 February 2014 with headline earnings per share (HEPS)
amounting to 19,1 cents per share (2013: 50 cents).
There were two significant non-recurring events during the financial year under review
resulting in a 62% decrease in HEPS and also contributing to a 30% decline in the Special
Lubricants segment's profit:
- The weakening of the Rand against all other major currencies lead to us incurring a
R1,3 million loss on a Foreign Exchange Contract confirmed during April 2013;
- A discrepancy in actual meter readings with City of Johannesburg resulted in an
additional un-provided-for amount of R1,2 million.
During the second half of the year the property in Slip Products (SA) (Pty) Limited,
together with the melting operations in Coppermet (Pty) Limited and Bronzmet (Pty)
Limited, was sold to Rand Refinery (Pty) Limited for the amount of R6,35 million. This
transaction resulted in a 22% decrease in turnover and a 198% increase in profit of the
metal powders segment. The property transfer is expected to take place in the 2015
financial year with a cash inflow of R3,3 million and is therefore classified as non-current
assets held for sale.
The net decrease in cash and cash equivalents were due to the following:
- Increase of 44% in capital expenditure due to the acquisition of the new ERP software;
- Increase in working capital;
- Repayment of mortgage bond.
In the Specialised Lubricants and Allied Chemicals segment, the Industrial division's sales
increased marginally, whilst the Consumer/Automotive division showed a 4% increase in
sales. The International division benefited from the sharp weakening of the Rand towards
the end of the financial year. A strong focus on our European markets increased sales by
25% in our subsidiary Spanjaard EU BV.
DIVIDENDS
Dividend No. 25 of 12 (twelve) cents per ordinary share was declared on 25 February 2014 for
the year ended 28 February 2014.
The dividend was subject to the Dividends Tax that was introduced with effect from 1 April 2012.
In accordance with the provisions of the Listings Requirements of the Johannesburg Stock Exchange,
the following additional information was disclosed:
- the dividend was declared out of profits available for distribution;
- the local Dividends Tax rate was 15%;
- the gross local dividend amount was 12 cents per share for shareholders exempt from Dividends Tax;
- no Secondary Tax on Companies’ credits was utilised;
- the net local dividend amount was 10,2 cents per share for shareholders liable for Dividends Tax;
- Spanjaard has 8 142 850 ordinary shares in issue;
- Spanjaard’s income tax reference number is 9543 676 84 6.
The following dates were applicable to the dividend:
The last date to trade in order to be eligible for the dividend was Friday, 16 May 2014.
Shares traded ex-dividend from Monday, 19 May 2014.
The record date was Friday, 23 May 2014 and payment was made on Monday,
26 May 2014.
Share certificates were not able to be dematerialised/rematerialised between Monday,
19 May 2014 and Friday, 23 May 2014, both days inclusive.
AUDIT OPINION
Mazars Inc. have audited the annual financial statements for the year ended
28 February 2014 from which this report is extracted and their unqualified audit report
is available for inspection at the Company's registered office.
NOTICE OF ANNUAL GENERAL MEETING AND PUBLICATION OF ANNUAL
REPORT
Shareholders are advised that:
- the Annual General Meeting of the Company ("the AGM") will be held at 12:00 on
Monday, 21 July 2014 at The Wanderers Club, 21 North Road, Illovo, Johannesburg;
- the annual report, incorporating a notice convening the AGM, is available on the
website of the Company at www.spanjaard.biz and will be distributed to shareholders
on Monday, 2 June 2014.
By order of the Board
Ms SF Venter
Company Secretary
29 May 2014
Directors:
RJW Spanjaard (Executive Chairman)
Ms E Nepgen (Managing Director)
GF Cort
Mrs S Hari*
BL Montgomery*
CKT Palmer
Prof DP van der Nest*
HJ van Heerden (Financial Director)
*Independent Non-executive
Registered office:
748 – 750 Fifth Street, Wynberg, Sandton, 2090
Transfer Secretaries:
Computershare Investor Services Proprietary Limited
70 Marshall Street, Johannesburg, 2001
Sponsor:
Arcay Moela Sponsors Proprietary Limited
Ground Floor, ONE Health Building
Woodmead North Office Park, 54 Maxwell Drive, Woodmead
Email: info@spanjaard.biz
Website: www.spanjaard.biz
Date: 29/05/2014 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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