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Consolidated Unaudited Interim results for the six months ended 31 August 2014
Adrenna Property Group Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/012245/06)
(JSE Share code: ANA ISIN: ZAE000163580)
CONSOLIDATED UNAUDITED INTERIM RESULTS
FOR THE SIX MONTHS ENDED 31 AUGUST 2014
CONDENSED STATEMENT OF COMPREHENSIVE INCOME
Six months Six months Twelve months
ended ended ended
31 August 2014 31 August 2013 28 February 2014
R'000 R'000 R'000
(unaudited) (unaudited) (audited)
Revenue 17 344 14 060 30 719
Cost of sales (2 881) (1 461) (2 912)
Gross profit 14 463 12 599 27 807
Operating income before interest and revaluations 4 853 5 427 12 285
Fair value adjustment on investment properties – – 9 330
Investment income 229 437 821
Finance costs (3 344) (3 568) (7 021)
Net income before taxation 1 738 2 296 15 415
Taxation (492) (696) (3 190)
Income after taxation for the period 1 246 1 600 12 225
Non-controlling interest – – –
Income attributable to ordinary shareholders 1 246 1 600 12 225
Total net profit 1 246 1 600 12 225
Other comprehensive income – – –
Total comprehensive income attributable to:
– Ordinary shareholders 1 246 1 600 12 225
– Non-controlling interests – – –
1 246 1 600 12 225
CONDENSED STATEMENT OF FINANCIAL POSITION
31 August 2014 31 August 2013 28 February 2014
R'000 R'000 R'000
(unaudited) (unaudited) (audited)
ASSETS
Non-current assets
Property, plant and equipment 72 68 72
Investment properties 206 491 197 161 206 491
Loans owing by third parties 404 7 350 5 075
Operating lease assets 5 678 4 665 5 678
Deferred taxation 4 292 3 856 4 339
Goodwill – 19 –
216 937 213 119 221 655
Current assets
Loans owing by third parties 232 2 403 2 089
Inventory 2 871 7 203 5 752
Accounts receivable 1 380 1 239 1 337
Operating lease assets 1 708 1 491 1 708
Current taxation receivable 156 – 10
Cash and cash equivalents 33 13 60
6 380 12 349 10 956
Total assets 223 317 225 468 232 611
EQUITY AND LIABILITIES
Equity
Stated capital and reserves 111 595 99 724 110 349
Non-current liabilities
Borrowings 66 072 78 570 69 679
Deferred tax 27 983 25 620 27 982
94 055 104 190 97 661
Current liabilities
Current portion of borrowings 7 462 6 901 10 560
Loans owing to third parties 406 406 406
Accounts payable 1 942 2 904 2 712
Taxation payable – 738 965
Bank overdraft 7 857 10 605 9 958
17 667 21 554 24 601
Total equity and liabilities 223 317 225 468 232 611
CONDENSED STATEMENT OF CASH FLOWS
Six months Six months Twelve months
ended ended ended
31 August 2014 31 August 2013 28 February 2014
R'000 R'000 R'000
(unaudited) (unaudited) (audited)
Cash generated by operations 2 251 2 778 6 116
Cash flows from investing activities 6 528 575 3 164
Cash flows from financing activities (6 705) (3 445) (8 678)
Movement in cash and cash equivalents 2 074 (92) 602
Cash and cash equivalents at the beginning of the period (9 898) (10 500) (10 500)
Cash and cash equivalents at the end of the period (7 824) (10 592) (9 898)
CONDENSED STATEMENT OF CHANGES IN EQUITY
31 August 2014 31 August 2013 28 February 2014
R'000 R'000 R'000
(unaudited) (unaudited) (audited)
STATED CAPITAL
Ordinary stated capital 567 567 567
RESERVES
Retained earnings
Balance at beginning of period 109 782 97 557 97 557
Comprehensive income attributable to ordinary shareholders 1 246 1 600 12 225
Balance at the end of the period 111 028 99 157 109 782
Total reserves attributable to:
Ordinary shareholders 111 028 99 157 109 782
Non-controlling interests – – –
Total reserves 111 028 99 157 109 782
Total equity and reserves 111 595 99 724 110 349
SUPPLEMENTARY INFORMATION
31 August 2014 31 August 2013 28 February 2014
(unaudited) (unaudited) (audited)
Number of ordinary shares in issue at the beginning of
the period ('000) 55 915 55 915 55 915
Number of ordinary shares in issue at the end
of the period ('000) 55 915 55 915 55 915
Weighted average number of shares in issue
during the period ('000) 55 915 55 915 55 915
Basic earnings:
Net profit per condensed statement of comprehensive income 1 246 1 600 12 225
Basic earnings per share (cents) 2,23 2,9 21,9
Headline earnings:
Net profit per condensed statement of comprehensive income 1 246 1 600 12 225
Profit on sale of investment property – – –
Impairments – – 19
Revaluation of investment property (net of taxation) – – (7 896)
Headline earnings 1 246 1 600 4 348
Headline earnings per share (cents) 2,23 2,9 7,8
Dividends per share (cents) – – –
Net asset value per share (cents) 199,6 178,3 197,4
Tangible net asset value per share (cents) 199,6 178,3 197,4
There was no dilution in basic or headline earnings per share during the period.
NOTES
BASIS OF PREPARATION
These condensed consolidated financial statements have been prepared in accordance with IAS 34: Interim Financial
Reporting, the requirements of the Companies Act, No. 71 of 2008 and the Listings Requirements of the Johannesburg Stock Exchange.
The unaudited condensed consolidated results have been prepared on the going concern basis as the directors are of the view that
the group has adequate resources in place to continue in operation for the foreseeable future. The accounting policies applied
are in compliance with International Financial Reporting Standards and the SAICA Financial Reporting Guides (formerly the
AC 500 Standards) as issued by the Accounting Practices Committee and its successor and are consistent with those applied
in the most recent annual financial statements. These results were prepared by the Financial Director, Mr H Beukes.
These results have not been reviewed or audited.
CONDENSED SEGMENT RESULTS
Six months Six months Twelve months
ended ended ended
31 August 2014 31 August 2013 28 February 2014
R'000 R'000 R'000
(unaudited) (unaudited) (audited)
Revenue
Investment Property Holding 13 748 12 832 27 386
Property-related services – – –
Property held for resale 3 596 1 228 3 333
Head office administration – – –
17 344 14 060 30 719
Income before taxation
Investment Property Holding 3 339 4 877 21 077
Property-related services (19) (62) (168)
Property held for resale 715 (233) –
Head office administration (2 297) (2 286) (5 494)
1 738 2 296 15 415
Total assets
Investment Property Holding 219 634 215 141 219 608
Property-related services 6 1 1
Property held for resale 2 871 – 5 752
Head office administration 806 10 326 7 250
223 317 225 468 232 611
Total liabilities
Investment Property Holding 102 714 113 671 110 778
Property-related services – 738 803
Property held for resale – – –
Head office administration 9 008 11 335 10 681
111 722 125 744 122 262
GENERAL REVIEW AND FINANCIAL RESULTS
Revenue yielded in the six months ended 31 August 2014 has shown a significant increase in comparison with the six months
ended 31 August 2013, attributable to a 7% increase in rental revenue combined with beneficial sales of two residential units
held as inventory. The allocation of proceeds of disposals to the outstanding bond obligations have resulted in a reduction
in the associated finance costs.
Regardless of the positive factors above, total comprehensive income for the six months ended 31 August 2014 declined
in comparison with the six months ended 31 August 2013. The primary factor behind this is the decision to provide for a
portion of administrative and management fees normally only accounted for toward the end of each reporting period, so as
to achieve comparability between the two halves of each fiscal year.
Without this change in the treatment of administrative and management costs, comprehensive income for the period ended
31 August 2014 would reflect a 7,5% improvement on comparative results for the period ended 31 August 2013.
The directors continue with their efforts to reduce existing borrowings and maximise rental from the income-producing
investment properties in the group.
The group continued to actively reduce its existing bank overdraft with First National Bank, having reduced the overdraft by
R2 101 000 in the six months since the end of the preceding financial year.
The reduction in the outstanding bond liabilities and the bank overdraft has produced an improvement in the net asset value
of 2 cents per share since the financial year-end.
As previously stated the directors will continue to focus on the generation of additional net asset value through the expansion
of the property portfolio couple with efforts to reduce borrowings and limit unnecessary overheads.
DIVIDENDS
Taking into account the negative impacts of the depressed economy and related problems in the property industry, the
directors have resolved to retain cash in the group to ensure future growth. As such, no dividend has been recommended.
31 October 2014
DIRECTORS: R P Fertig (Chief Executive Officer), W P Alcock† (Chairman), H Beukes CA(SA) (Financial Director),
B Mothelesi*, M Moela*, R Watson* (†Non-executive) (*Independent non-executive)
COMPANY SECRETARY: B W Kaiser
TRANSFER SECRETARIES: Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, 2001
REGISTERED OFFICE: 2969 William Nicol Drive, Wedgewood Link, Bryanston, 2021
SPONSOR: ARBOR CAPITAL SPONSORS (PTY) LIMITED
Date: 31/10/2014 07:09:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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