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WILSON BAYLY HOLMES-OVCON LIMITED - Unaudited interim summary financial statements for the six months ended 31 December 2014

Release Date: 23/02/2015 08:00
Code(s): WBO     PDF:  
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Unaudited interim summary financial statements for the six months ended 31 December 2014

WILSON BAYLY HOMLES-OVCON LIMITED
Building and civil engineering contractors 
(Registration no: 1982/011014/06) 
ISIN NO: 000009932 Sharecode WBO

UNAUDITED INTERIM SUMMARY CONSOLIDATED FINANCIAL STATEMENTS FOR THE SIX MONTHS ENDED 31 DECEMBER 2014

BASIS OF PREPARATION
The summary consolidated financial statements for the period ended 31 December 2014 have been prepared in compliance with the Listings Requirements of the 
JSE Limited, the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards ("IFRS"), the requirements 
of the International Accounting Standards (“IAS”) 34, Interim Financial Reporting, SAICA Financial Reporting Guidelines as issued by the Accounting Practices 
Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and the Companies Act of South Africa.

The summary consolidated financial statements have been prepared on the historical cost basis, except for specific financial assets and derivative financial 
instruments which are measured at fair value through profit and loss. The accounting policies used in the preparation of these results are consistent in all 
material respects with those used in the audited annual financial statements for the year ended 30 June 2014.

The information disclosed in these statements has not been reviewed nor reported on by the group’s auditors.

CONSOLIDATED STATEMENT OF FINANCIAL PERFORMANCE AND OTHER COMPREHENSIVE INCOME
for the six months ended 31 December 2014

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                    % Change             R’000              R’000           R’000       

Revenue                                                             11,1                 14 675 871         13 206 037      25 721 683
Operating profit before non-trading items                          (25,8)                   397 243            535 303       1 029 446
Impairment of goodwill                                                                            -                  -            (392)
Gain on bargain purchase option                                                                   -             37 166               -
Loss on deemed disposal of associate                                                              -            (46 646)         (1 914)
Impairment of property, plant and equipment                                                       -                  -         (15 340)
Gain on disposal of investment                                                                    -              7 950               -
Net gain on disposal of property, plant and equipment                                        17 192                  -               -
Share-based payment expense                                                                 (18 284)           (15 741)        (33 337)
Operating profit                                                                            396 151             18 032         978 463
Share of profits from associate                                                              11 367              4 976          11 168
Net finance income                                                                           50 614             51 157         114 091
Profit before taxation                                                                      458 132            574 165       1 103 722
Taxation                                                                                   (137 717)          (171 803)       (332 149)
Profit from continuing operations                                  (20,6)                   320 415            402 362         771 573
Profit/(loss) from discontinued operations                                                    6 716            (96 000)       (523 336)
Profit for the period                                                                       327 131            306 362         248 237
Other comprehensive income
Items that may be reclassified to profit or loss:
Translation of foreign entities                                                             (91 308)             2 595         (64 216)
Share of associate’s comprehensive income                                                         -                  -           6 967
Total comprehensive income for the period                          (23,7)                   235 823            308 957         190 988
Operating margin                                                                                2,7%               4,1%            4,0%
Profit attributable to:
Equity shareholders of Wilson Bayly Holmes-Ovcon Limited                                    315 403            303 313         422 742
Non-controlling interests                                                                    11 728              3 049        (174 505)
                                                                                            327 131            306 362         248 237
Total comprehensive income attributable to:
Equity shareholders of Wilson Bayly Holmes-Ovcon Limited                                    249 059            315 252         401 252
Non-controlling interests                                                                   (13 236)            (6 295)       (210 264)
                                                                                            235 823            308 957         190 988
Basic earnings per share (cents)                                     3,9                      569,8              548,2           763,8
Diluted earnings per share (cents)                                   4,8                      569,8              543,5           762,6
Headline earnings per share (cents)                                 (7,8)                     540,9              586,4         1 172,6
Dividend per share (cents)                                         (18,5)                     110,0              135,0           368,0
Profit from continuing operations attributable to:
Equity shareholders of Wilson Bayly Holmes-Ovcon Limited                                    307 313            356 651         703 384
Non-controlling interests                                                                    13 102             45 711          68 189
                                                                                            320 415            402 362         771 573
Earning per share – continuing operations
Basic earnings per share (cents)                                   (13,9)                     555,2              644,6         1 270,8
Diluted earnings per share (cents)                                 (13,1)                     555,2              639,1         1 268,8
Headline earnings per share (cents)                                (18,4)                     529,9              649,8         1 278,4

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 31 December 2014

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                                         R’000              R’000           R’000     
                                
Stated capital and reserves at the beginning of the period                                4 591 240          4 423 257       4 423 257
Profit for the period                                                                       315 403            303 313         422 742
Other comprehensive income                                                                  (66 343)             2 595         (21 490)
Dividends paid                                                                             (146 610)          (140 077)       (235 490)
Share-based payment expense                                                                  18 284             15 741          33 337
Treasury shares sold                                                                              -            (12 549)              -
Share-based payment settlement                                                                7 536                  -          12 496
Changes in shareholding                                                                     (32 618)           (13 200)        (43 612)
Stated capital and reserves at the end of the period                                      4 686 892          4 579 080       4 591 240

CONSOLIDATED STATEMENT OF FINANCIAL POSITION
at 31 December 2014

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                                         R’000              R’000           R’000     
ASSETS
Non-current assets
Property, plant and equipment                                                             2 096 230          2 696 948       2 163 442
Goodwill                                                                                    615 151            599 353         644 936
Intangible assets                                                                             1 282              1 282           1 282
Investment in associates                                                                    119 195            103 998          97 847
Investments                                                                                 133 777             73 116          96 997
Long-term receivables                                                                       442 441            296 907         292 345
Deferred taxation                                                                           381 626            397 166         365 903
Total non-current assets                                                                  3 789 702          4 168 770       3 662 752
Current assets
Inventories                                                                                 331 637            595 645         259 025
Amounts due by customers                                                                    800 798            745 454         929 688
Trade and other receivables                                                               4 011 931          3 502 374       4 955 738
Taxation receivable                                                                         404 588            321 750         356 268
Cash and cash equivalents                                                                 3 282 603          3 048 278       2 756 700
Total current assets                                                                      8 831 557          8 213 501       9 257 419
Disposal group held-for-sale                                                                305 625                  -         477 642
Total assets                                                                             12 926 884         12 382 271      13 397 813
EQUITY AND LIABILITIES
Capital and reserves
Stated capital                                                                               28 625             28 625          28 625
Non-distributable reserves                                                                  538 349            560 821         578 873
Distributable reserves                                                                    4 119 918          3 989 634       3 983 742
Shareholder’s equity                                                                      4 686 892          4 579 080       4 591 240
Non-controlling interests                                                                   289 873            430 129         273 776
Total equity                                                                              4 976 765          5 009 209       4 865 016
Non-current liabilities
Borrowings                                                                                  149 623            252 768         184 903
Deferred taxation                                                                            65 828             19 591          32 591
Total non-current liabilities                                                               215 451            272 359         217 494
Current liabilities
Excess billings over work done                                                            1 904 001          1 405 820       1 417 028
Trade and other payables                                                                  3 908 849          3 270 607       4 697 296
Short-term portion of borrowings                                                            170 167            233 400         149 645
Provisions                                                                                1 173 780          1 689 677       1 313 421
Taxation payable                                                                             51 519            102 866          66 552
Bank overdraft                                                                               63 114            398 333         115 605
Total current liabilities                                                                 7 271 430          7 100 703       7 759 547
Disposal group held-for-sale                                                                463 238                  -         555 756
Total equity and liabilities                                                             12 926 884         12 382 271      13 397 813

CONSOLIDATED STATEMENT OF CASH FLOWS
for the six months ended 31 December 2014
                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                                         R’000              R’000           R’000      

Operating profit before working capital requirements                                        261 734            835 531       1 344 045
Working capital changes                                                                     813 708           (424 447)       (546 938)
Cash generated from operations                                                            1 075 442            411 084         797 107
Net finance income                                                                           47 402             34 465          61 005
Taxation paid                                                                              (168 589)          (360 966)       (548 071)
Dividends paid                                                                             (175 075)          (163 775)       (265 089)
Cash retained from/(utilised in) operations                                                 779 180            (79 192)         44 952
Cash flow from investing activities
Advances of long-term receivables                                                          (141 044)          (125 189)       (211 166)
Additions to investments                                                                    (41 748)           (27 900)        (53 547)
Additional investments in associates                                                        (14 050)                 -         (27 524)
Changes in shareholding of subsidiaries                                                     (11 483)           (44 800)        (54 787)
Repayment of receivables                                                                      7 835              7 892          15 753
Proceeds on disposal of businesses                                                          114 274                  -          29 052
Proceeds on disposal of property, plant and equipment                                        54 783             63 061         106 175
Purchase of property, plant and equipment                                                   (95 368)          (144 763)       (302 143)
Net cash flow from investing activities                                                    (126 801)          (271 699)       (498 187)
Cash flow from financing activities
Advances/(repayment) of interest-bearing borrowings                                          38 933                  -         (22 565)
Instalments in respect of capitalised finance leases                                       (106 295)            (86 192)      (163 494)
Net cash flow from financing activities                                                     (67 362)            (86 192)      (186 059)
Net increase/(decrease) in cash and cash equivalents                                        585 017            (437 083)      (639 294)
Cash and cash equivalents at the beginning of the period                                  2 641 095           3 335 559      3 335 559
Net overdraft in respect of disposal group at the beginning of the period                  (268 450)                  -              -
Net overdraft acquired                                                                            -            (271 204)      (263 927)
Foreign currency translation effect                                                         (33 592)             22 673        (59 693)
Net overdraft in respect of disposal group                                                  295 419                   -        268 450
Cash and cash equivalents at the end of the period                                        3 219 489           2 649 945      2 641 095


NOTES TO THE SUMMARY FINANCIAL STATEMENTS
for the six months ended 31 December 2014


1. DISCONTINUED OPERATIONS, DISPOSAL GROUP HELD-FOR-SALE AND RESTATEMENT OF PRIOR PERIOD FIGURES
The results for the comparative period to 31 December 2013 have been restated to reflect the trading from those operations which met the requirements for 
classification as discontinued operations at 30 June 2014, (Capital Star Steel, Dywidag Systems International , Symo Steel and Krost Shelving) as well as 
Belabela, a quarry in Botswana, which met the classification requirements for discontinued operations in the current period. The results for the comparative 
period to 30 June 2014 have been restated to reflect the trading from Belabela only.

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                                         R’000              R’000           R’000 
Revenue                                                                                      94 365             171 382        538 955
Cost of sales                                                                               (78 209)           (175 732)      (565 802)
Gross profit/(loss)                                                                          16 156              (4 350)       (26 847)
Operating expenses                                                                           (2 160)            (50 519)       (33 682)
Operating profit/(loss) before non-trading items                                             13 996             (54 869)       (60 529)
Impairment of property, plant and equipment                                                       -                   -       (360 014)
Profit on sale of associate                                                                   4 435                   -              -
Loss on disposal of operations                                                                    -             (25 681)       (39 778)
Onerous contracts                                                                                 -                   -        (35 233)
Operating profit/(loss) before non-trading items                                             18 431             (80 550)      (495 554)
Share of profits from associate                                                                   -               2 096          5 223
Net finance costs                                                                           (11 072)            (17 902)       (32 195)
Profit/(loss) before tax                                                                      7 359             (96 356)      (522 526)
Taxation (expense)/credit                                                                      (643)                356           (810)
Profit/(loss)                                                                                 6 716             (96 000)      (523 336)
Effect of restatement                                                                                            96 000         (3 694)
As previously reported                                                                                                -       (527 030)
Profit/(loss) attributable to:
Equity shareholders of Wilson Bayly Holmes-Ovcon Limited                                      8 089             (53 338)       280 642
Non-controlling interests                                                                    (1 373)            (42 662)      (242 694)
                                                                                              6 716             (96 000)      (523 336)
Cash flow
Net cash from operating activities                                                         (131 108)            (46 643)      (130 406)
Net cash from investing activities                                                          114 274                (574)       (16 350)
Net cash from financing activities                                                          (10 135)             (8 261)        88 951
Disposal group held-for-sale
Property, plant and equipment                                                               191 531                   -        178 000
Inventories                                                                                  56 229                   -        137 270
Trade and other receivables                                                                  30 896                   -         44 722
Cash and cash equivalents                                                                    26 969                   -         32 085
Total assets                                                                                305 625                   -        392 077
Trade and other payables                                                                   (124 857)                  -       (213 108)
Provisions                                                                                  (15 993)                  -        (42 113)
Bank overdraft                                                                             (322 388)                  -       (300 535)
Total Liabilities                                                                          (463 237)                  -       (555 756)
Non-current asset held-for-sale
Investment in associate                                                                           -                   -         85 565

2. RECONCILIATION OF HEADLINE EARNINGS 

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014
                                                                                         R’000              R’000           R’000       

Reconciliation of headline earnings from continuing operations
Attributable profit - continuing operations                                                 307 313              356 651       703 384
Adjusted for:
Group:
Impairment of goodwill                                                                            -                    -           392
Gain on bargain purchase option                                                                   -              (37 166)            -
Loss on deemed disposal of associate                                                              -               46 646         1 914
Impairment of property, plant and equipment*                                                      -                    -        14 825
Gain on disposal of investments                                                                   -               (7 950)            -
Net (gain)/loss on disposal of property, plantand equipment*                                 (17 192)              1 844       (12 213)
Tax effect thereof                                                                             3 177                (516)            -
Associates:
Profit on disposal of property, plant and equipment                                                -                  (4)            -
Impairment of property, plant and equipment*                                                       -                  23             -
Tax effect thereof                                                                                 -                  (5)         (731)
Headline earnings from continuing operations                                                 293 298             359 523       707 571
Reconciliation of headline earnings from totaloperations
Attributable profit                                                                          315 403             303 313       422 742
Adjusted for:
Group:
Impairment of goodwill                                                                             -                   -           392
Gain on bargain purchase option                                                                    -             (37 166)            -
Loss on deemed disposal of associate                                                               -              46 646         1 914
Net (gain)/loss on disposal of property, plantand equipment*                                 (17 192)              1 844       (12 213)
Gain on disposal of associate*                                                                (2 464)                  -             - 
Net loss on disposal of operations*                                                                -              10 349        22 101
Impairment of property, plant and equipment*                                                       -                   -       214 849
Tax effect thereof                                                                             3 632                (516)         (731)
Associates:
Profit on disposal of property, plant and equipment                                                -                  (4)            -
Impairment of property, plant and equipment                                                        -                  23             -
Tax effect thereof                                                                                 -                  (5)            -
Headline earnings                                                                            299 379             324 484       649 054

* Net of non-controlling interest

3. SEGMENTAL ANALYSIS – CONTINUING OPERATIONS

                                                                                                            Restated        Restated
                                                                                         Unaudited          unaudited       audited
                                                                                         December           December        June
                                                                                         2014               2013            2014  
Segment revenue                                                          % Change        R’000              R’000           R’000       

Building and civil engineering                                                8,7           3 810 298          3 505 612     7 001 985
Roads and earthworks                                                         12,9           2 837 574          2 513 175     5 001 508
Australia                                                                    11,7           7 298 531          6 532 872    12 437 970
Total construction revenue                                                   11,1          13 946 403         12 551 659    24 441 463
Property developments                                                       (15,1)             19 537             23 008        84 601
Construction materials                                                       12,4             709 931            631 370     1 195 619
Total revenue                                                                11,1          14 675 871         13 206 037    25 721 683
Segment operating profit
                                                                         % margin
Building and civil engineering                                                4,4             167 906            152 078       329 089
Roads and earthworks                                                          7,1             202 755            220 376       413 888
Australia                                                                       -                 478            134 412       250 040
Total construction operating profit                                           2,7             371 139            506 866       993 017
Property developments                                                        41,4               8 086              9 967        28 057
Construction materials                                                        2,5              18 018             18 470         8 372
Total operating profit                                                        2,7             397 243            535 303     1 029 446
Geographical revenue contribution
                                                                         % change
South Africa                                                                 11,4           5 726 393          5 138 263    10 242 531
Rest of Africa                                                                7,6           1 650 947          1 534 902     3 041 182
Australia                                                                    12,4           7 298 531          6 532 872    12 437 970
                                                                             11,1          14 675 871         13 206 037    25 721 683
Geographical profit contribution
                                                                         % margin
South Africa                                                                  4,3             246 017            229 016       495 022
Rest of Africa                                                                9,1             150 748            171 875       284 381
Australia                                                                       -                 478            134 412       250 043
                                                                              2,7             397 243            535 303     1 029 446


4. ORDINARY SHARES

                                                                                Unaudited               Unaudited       Audited
                                                                                December                December        June
                                                                                2014                    2013            2014
                                                                                R’000                   R’000           R’000       

Ordinary shares in issue (’000)                                                   66 000                   66 000          66 000
Weighted average number of shares (‘000)                                          55 350                   55 331          55 350
Diluted weighted average number of shares (‘000)                                  55 350                   55 804          55 436


FINANCIAL REVIEW
Continuing operations
Revenue from continuing operations increased by 11% to R14,7 billion supported by moderate growth across all the group’s business segments. The 9% growth achieved 
by the Building and civil engineering division continues to reflect the strength within local building markets. The Roads and earthworks division grew by 13%. In 
Australia, revenue in dollar terms increased by 6%, consisting of an 18% increase in revenue from the building divisions being partially offset by a 39% decline 
in revenues from the civil businesses. In rand terms Australian revenue increased by 12%. Revenue in respect of the continuing operations within the Construction 
materials segment, namely the reinforcing and ready-mix businesses, also achieved growth of 12%. In aggregate, operating profit from continuing operations before 
non-trading items decreased by 26% to R397 million, at a margin of 2,7%, compared to R535 million (restated to exclude the losses from discontinued operations) 
at a margin of 4,1% in the comparative period. The predominant reason behind the decrease in the overall margin for the current period relates to losses incurred 
within both Australian civil businesses as a result of three material loss-making contracts together with a particularly subdued market. The margin of 4,4% achieved 
by the Building and civil engineering division is in line with that of the prior period, while the Roads and earthworks margin continues to decline (7,1% at 
December FY15 compared to 8,8% at December FY14) due to competitive conditions across all markets and an under-performing project in Botswana. The margin of 
2,5% achieved from continuing operations within the construction materials segments shows some improvement from the 1,1% achieved at 30 June 2014 but remains 
lower than the 3% achieved in the comparative period.

Discontinued operations and restatement of prior period figures
The respective results for the comparative periods to 31 December 2013 and to 30 June 2014 have been restated in accordance with IFRS to reflect the trading from 
those operations which met the requirements for classification as discontinued operations at 30 June 2014, (Capital Star Steel (CSS), Dywidag Systems International 
(DSI), Symo Steel and Krost Shelving) as well as a quarry in Botswana, which met the classification requirements for discontinued operations in the current period. 
The statements of financial position has not been restated.

Symo Steel and Krost Shelving were both disposed of in FY14 while DSI was disposed of in the first half of FY15. A sale agreement in respect of Belabela (Pty) Ltd 
has been concluded subject to conditions precedent which should be achieved in the first quarter of 2015. The process to conclude a sale of CSS did not result in a 
formal offer for the business. Two parties continue to negotiate a possible purchase with Capital Africa Steel. The closure of operations in the factory is almost 
complete.

Earnings per share and headline earnings per share
Overall earnings per share increased by 4% from 548 cents per share at 31 December 2013 to 570 cents per share at 31 December 2014, while overall headline earnings 
per share decreased by 8% to 541 cents per share from 586 cents per share. Earnings per share and headline earnings per share in respect of continuing operations 
decreased by 14% and 18% respectively over the comparative period due to the poor performance from Australia.

Cash
Since 30 June 2014 cash balances have increased by R578 million to R3,2 billion (excluding the overdraft within the disposal group held-for-sale). Cash generated 
from operations amounts to R1,1 billion compared to R411 million generated in the comparative period. This together with lower capital expenditure during the period 
was largely responsible for the 21% increase in the cash balances . Capital expenditure during the period amounted to R95 million and depreciation amounted to 
R170 million (2013: R170 million).

Contingent liabilities
Financial guarantees issued to third parties amount to R5,1 billion compared to R6,6 billion issued as at 30 June 2014.

OPERATIONAL REVIEW
Building and civil engineering

                                                                                December                 December
                                                                                2014                     2013 
                                                                                Rm                       Rm

Revenue                                                    8,7% growth             3 810                    3 506
Operating profit                                           4,4% margin               168                      152

Building
The group’s local building divisions continue to perform well under the current favourable market conditions. In Gauteng, strong revenue growth was supported by 
construction at 8 different shopping centres and mixed-use developments, seven of which were completed and handed over in the current six month period. Construction 
at the Mall of Africa shopping centre in Waterfall, Midrand will continue well into FY16. Ongoing construction at various corporate office precincts contributed 
significantly during the period following the commencement of new phases at both Menlyn Maine and Alice Lane in Tshwane and Sandton respectively. Construction of 
the serviced accommodation for the Department of Statistics, secured through the group’s Projects division is progressing well.

In the Western Cape, activity over the current six months consisted of construction of a number of projects at the V&A Waterfront, including the new Museum of 
Contemporary African Art, a new hospital for Netcare and various apartments, retail and office developments. The group’s Projects team together with the Western Cape 
division successfully achieved practical completion at the Kathu photovoltaic solar farm in the Northern Cape. In Kwa-Zulu Natal (KZN) various corporate office 
projects in Umhlanga, ongoing construction at both private and public hospitals and work for Transnet at the port all contributed toward good growth in the region.
Market conditions in the Eastern Cape have improved since the second half of FY14 and contributed toward the region’s growth during the period supported by new work 
at the Coega Development Zone and extensions to the Greenacres shopping centre.

In Ghana, the West Hills and Junction malls were successfully completed and handed over during the period while construction at the Achimota mall, awarded toward the 
end of FY14, is on programme.

Civil engineering
Construction of the main civil works at the Kusile Power Station is nearing completion. This project continued to contribute strongly towards the division’s 
revenue in the current six months. Mining opportunities remain scarce however further construction at Glencore’s Tweefontein mine is progressing well along 
with a new malting plant for SAB. The division continues to maintain a presence in Zambia with a number of new smaller awards in the current period.

Roads and earthworks

                                                                                 December              December
                                                                                 2014                  2013 
                                                                                 Rm                    Rm

Revenue                                                    12,9% growth            2 837                     2 513
Operating profit                                            7,1% margin              203                       220

In light of the depressed market conditions within the mining sector, opportunities for large-scale projects remain scarce, however the division has secured 
some medium-sized mining contracts as well as a number of smaller scale contracts and extensions to existing contracts locally, as well as in Ghana, Mozambique 
and Botswana.

Revenue from the SADC region was broadly in line with that of the comparative period, supported by ongoing construction of the ash dam and coal stock yard at 
Kusile Power Station and existing mining contracts at Glencore’s Tweefontein mine, Sasol’s Shondoni mine and the Husab Uranium mine in Namibia. In Botswana, 
the three-year long AK6 mining project is now complete while the North South Carrier Pipeline will only begin commissioning in FY16 following the award for 
the replacement of a 28km section of the existing pipeline to Gaborone. Various delays and co tively affected the profitability of this project. Revenue from 
Mozambique has shown good growth during the period due to the award of new mining infrastructure projects at the Vale mine and ongoing construction in respect 
of the Ressano Garcia Power Station and the EN4 road rehabilitation contracts. Both Edwin and Roadspan continue to perform satisfactorily in the road rehabilitation 
sector. In West Africa, a reduced team remains in Ghana to execute the smaller scale mining infrastructure contracts mentioned above.

Australia

                                                                                December              December
                                                                                2014                  2013 
                                                                                Rm                    Rm
 
Revenue                                                     11,7% growth           7 299                    6 533
Operating profit                                               0% margin               -                      134

Probuild
Revenue from Probuild increased by 18% in dollar terms, where good growth across most of the building divisions was partially offset by a decline in revenue from 
Probuild Civils. Entry into the Brisbane building market and the commencement of work on three major shopping centre projects awarded in the previous period, 
supported the growth in the building divisions.

Three problematic contracts within Probuild Civils had a significant impact on the overall margin achieved by Probuild, however all expected losses have been 
accounted for in the current period and these projects will be completed in the six months to June FY15.

WBHO Civil
Revenue from WBHO Civil declined by 18% as a result of declining commodity prices negatively affecting the Australian mining sector. Completion of the Burrop 
Technical Ammonia Nitrate Facility in the Pilbara and the Nyngan photovoltaic solar farm in New South Wales (NSW) have been problematic with significant losses 
incurred in the current period. Both projects will be completed in the six months to June FY15.

Property

                                                                                December              December
                                                                                2014                  2013 
                                                                                Rm                    Rm
Revenue                                                                               20                     23
Operating profit                                                                      8                      10

Revenue from Property developments represents the transfer of all but three of the remaining stands at the Simbithi Eco Estate near the King Shaka International 
Airport in KZN.

Capital Africa Steel

                                                                                December              December
                                                                                2014                  2013 
                                                                                Rm                    Rm

Continuing operations
Revenue                                                                              710                    631
Operating profit                                                                      18                     18
Discontinued operations
Revenue                                                                               94                    171
Operating profit/(loss)                                                               14                    (55)

Revenue from continuing operations increased by 12%. Margins for the first six months within the reinforcing business were impacted by the steel strikes in 
July FY14, while the ready-mix business performed reasonably well having secured supply contracts on various large building projects. Manufacturing within CSS 
has ceased with all contractual obligations satisfied and the bulk of the inventory sold.


ORDER BOOK AND OUTLOOK

                                                                                December                December
                                                                                2014                    2013 
                                                                  %             Rm            %         Rm

Order book by segment
Building and civil engineering                                    21               8 039      23            8 207
Roads and earthworks                                              10               3 935      14            5 064
Australia                                                         69              26 157      63           22 880
Total                                                            100              38 131     100           36 151
Order book by geography
South Africa                                                      28              10 634      31           11 363
Rest of Africa                                                     3               1 340       6            1 908
Australia                                                         69              26 157      63           22 880
Total                                                            100              38 131     100           36 151

The 5% increase in the order book at 31 December 2014 to R38,1 billion from R36,2 billion at 30 June 2014 reflects a 14% increase in the Australian book, while 
the Roads and earthworks book has declined by 22%. This has resulted in further dilution of the contribution from Africa (including South Africa) to 31% 
(30 June 2014: 37%).

Africa (including South Africa)
The strength currently being experienced within the local building market is expected to continue over the short to medium-term. The building and civil engineering 
division’s order book which has grown significantly over the last two years has been maintained at R8 billion. New offices for Discovery as well the Rosebank Towers 
were awarded during the current six months while negotiations for new offices at Waterfall in Gauteng, a shopping centre in KZN and additional work at the V&A Water
front in Cape Town are at an advanced stage. The International building division has been awarded a contract for a new shopping centre in Pemba, Mozambique and two 
further shopping centres in Ghana are under negotiation.

The effect of persistently low commodity prices on the mining sector is resulting in planned projects being cancelled or delayed. This together with the release of 
resources from the main civil works at Kusile has resulted in over-capacity within the civil engineering division and management have re-sized the division accordingly.
The current mining sector environment together with the reduced activity within the road sector have seen a decline in the Roads and earthworks order book in the 
current six months, however a number Reya-Vaya bus rapid transport contracts in both KZN and Gauteng will provide work from this sector into FY16. Roadspan and 
Edwin Construction, both of which rely heavily on the road sector have sufficient work on hand for the current year, however replacement of these contracts is a 
concern. Activity levels in Botswana have been low for some time, although the pipeline sector in the region will continue to offer opportunities and as mentioned 
above the division secured a further phase on the North South Carrier Pipeline. Prospects in the mining, rail and road sectors in Mozambique are limited and the 
current low level of the oil price may potentially delay the start-up of projects from the oil and gas sector. In West Africa, the division is able to find sufficient 
work to keep the remaining resources there occupied.

The renewable energy sector remains a focus for the group’s Projects team as well as opportunities in Africa. Further to the Competition Commission Fast Track 
Settlement Process which was finalised in July 2013, WBHO had previously advised that five alleged prohibited practices (that WBHO believes are not contraventions 
of the Competition Act) were not settled as part of this Fast Track Settlement Process. The Commission has subsequently confirmed non-referral of two of these 
alleged prohibited practices.

The Commission has referred one of the above cases, the 2006 "World Cup Stadia meeting" matter to the Tribunal. On considered legal advice, WBHO had refused to 
settle this matter as part of the Fast Track Settlement Process as WBHO is firmly of the opinion that this meeting was not collusive in nature. WBHO is also in 
receipt of a civil claim from the City of Cape Town in relation to the Competition Commission Fast Track settlements on the Cape Town stadium. WBHO believes that 
the City of Cape Town suffered no damage.

WBHO is confident that it can defend the above cases and has not made a provision in this regard.

Australia
The building sectors in Melbourne, Sydney and Brisbane continue to provide a significant number of work opportunities for the construction industry. A growing 
population is driving residential growth, and the largescale residential towers market, which has been particularly strong in Melbourne, is now spreading to 
Brisbane and Sydney as well. Probuild secured two new major tower projects in Melbourne in the current six months and having only recently entered the Brisbane 
building market will be selective on which projects to bid. Residential opportunities with Asian developers have also grown in Sydney and Probuild is carefully 
entering this market as it grows its teams and capacity in the region. Retail remains a good source of projects in Melbourne and is now showing signs of improving 
in Sydney as well. Activity within the Perth building market, which has leveraged off the mining boom in the region in recent years, has slowed due to the difficult 
conditions currently facing this sector.

The traditional civil market in Western Australia is in decline following the mining boom over recent years, while in Queensland the completion of all flood 
related works has resulted in a declining market. Both WBHO Civils and Probuild Civils are in a process of restructuring in order to right-size the businesses 
for the current environment. It is anticipated that future infrastructure spend is likely to be directed toward Sydney and Melbourne and a new managing director 
to lead a repositioning of the civil businesses has been recently appointed.

SAFETY
The group’s LTIFR continues to improve and now stands at 0,84 down from 0,94 at 30 June 2014. This remains within the group’s target of less than one. There 
were improvements across all the groups segments where Australia demonstrated further improvement in its LTIFR which decreased from 1,60 at 30 June 2014 to 
1,47 in the current period. Sadly the group experienced two work-related fatalities in the period, one of which was a subcontractor. One further non-work 
related fatality was recorded. We extend our sincere condolences to their families, friends and colleagues.

APPRECIATION
The directors and management again thank our employees, clients and all other stakeholders for their contribution and ongoing support and loyalty.

DIVIDEND DECLARATION
Notice is hereby given that the directors have declared an interim gross dividend of 110 cents per share (2013: 135 cents) payable to all shareholders recorded 
in the register on 17 April 2015.

In terms of the dividends tax legislation the following information is disclosed:
The dividend is made from income reserves and is subject to dividend withholding tax of 15% which results in a net dividend of 93.50 cents per share. The company 
has no STC credits to be utilised.

The number of shares in issue at date of declaration amount to 66 000 000 (55 350 001) exclusive of treasury shares) and the company’s tax reference number 
is 9999597710.

In order to comply with the requirements of Strate, the following details are relevant:
Last date to trade cum dividend:      Friday 10 April 2015
Trading ex dividend commences:        Monday 13 April 2015
Record date:                          Friday 17 April 2015
Payment date:                         Monday 20 April 2015
Shares may not be dematerialised or re-materialised between Monday, 13 April and Friday 17 April 2015, both dates inclusive.

Mike Wylie            Louwtjie Nel                     Charles Henwood
Chairman              Chief Executive Officer          Chief Financial Officer

20 February 2015
Sponsor
Investec Bank Limited

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