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RAUBEX GROUP LIMITED - Audited results for the year ended 28 February 2015

Release Date: 11/05/2015 07:05
Code(s): RBX     PDF:  
Wrap Text
Audited results for the year ended 28 February 2015

Raubex Group Limited
(Incorporated in the Republic of South Africa)
Registration number 2006/023666/06
Share Code: RBX
ISIN Code: ZAE000093183
("Raubex" or the "Group")

Audited results for the year ended 28 February 2015

Salient features
- Revenues up 14,5% to R7,25 billion (2014: R6,33 billion)
- Operating profit up 15,2% to R622,2 million (2014: R539,9 million)
- Group operating profit margin of 8,6% (2014: 8,5%)
- HEPS up 11,8% to 209,1 cents per share (2014: 187,1 cents per share)
- Cash flow from operations up 4,5% to R785,1 million (2014: R751,4 million)
- Capex spend of R510,6 million (2014: R483,3 million)
- Order book of R8,68 billion (2014: R6,55 billion)
- Final dividend of 36 cents per share declared

Rudolf Fourie, CEO of Raubex Group, said: "We have delivered a strong set of results in a tough 
environment supported by a great performance from the materials division which now accounts for 
over 50% of the Group's earnings.

"The recent acquisitions have been successfully integrated and are contributing positively. 
We will continue to seek earnings enhancing acquisitions that are in line with our integrated model.

"The Group's order book is at an all-time high and the international projects secured in Zambia 
allow us to be more selective in the work that we tender for in South Africa.

"Our more diversified base, strong balance sheet and cash position will help us navigate the 
challenging conditions in the South African construction market and deliver growth in the 
year ahead."


Group income statement                         
                                            Audited            Audited
                                          12 months          12 months
                                        28 February        28 February
                                               2015               2014
                                              R'000              R'000
Revenue                                   7 245 259          6 325 012
Cost of sales                            (6 257 742)        (5 463 929)
Gross profit                                987 517            861 083
Other income                                 12 113             11 302
Other gains/(losses) - net                    9 984             16 021
Administrative expenses                    (387 443)          (348 531)
Operating profit                            622 171            539 875
Finance income                               46 520             38 749
Finance costs                               (62 259)           (44 162)
Share of profit of investments         
accounted for using the equity         
method                                          205                  -
Profit before income tax                    606 637            534 462
Income tax expense                         (178 563)          (154 786)
Profit for the year                         428 074            379 676
Profit for the year attributable to:                         
Owners of the parent                        399 837            355 573
Non-controlling interest                     28 237             24 103
Basic earnings per share (cents)              213,4              191,3
Diluted earnings per share (cents)            209,9              187,9
                                                             

Group statement of comprehensive income  
                                            Audited            Audited
                                          12 months          12 months
                                        28 February        28 February
                                               2015               2014
                                              R'000              R'000
Profit for the year                         428 074            379 676
Other comprehensive income for                            
the year, net of tax                                      
Currency translation differences                382              4 688
Actuarial (loss)/gain on                                  
post-employment benefit                                   
obligations                                    (137)             2 043
Total comprehensive income for                            
the year                                    428 319            386 407
Comprehensive income for the                              
year attributable to:                                     
Owners of the parent                        400 082            362 304
Non-controlling interest                     28 237             24 103
Total comprehensive income for                            
the year                                    428 319            386 407


Calculation of diluted earnings per share
                                            Audited            Audited
                                          12 months          12 months
                                        28 February        28 February
                                               2015               2014
                                              R'000              R'000
Profit attributable to owners of the                      
parent entity                               399 837            355 573
Weighted average number of                                
ordinary shares in issue ('000)             187 330            185 900
Adjustments for:                                          
Shares deemed issued for no                               
consideration (share options)                             
('000)                                        3 202              3 360
Weighted average number of                                
ordinary shares for diluted                               
earnings per share ('000)                   190 532            189 260
Diluted earnings per share (cents)            209,9              187,9


Calculation of headline earnings per share  
                                            Audited            Audited
                                          12 months          12 months
                                        28 February        28 February
                                               2015               2014
                                              R'000              R'000
Profit attributable to owners of the                      
parent entity                               399 837            355 573
Adjustments for:                                          
Profit on sale of property, plant                         
and equipment                               (11 348)           (10 244)
Excess from fair value of assets                          
acquired over purchase price                      -               (368)
Total tax effects of adjustments              3 177              2 868
Basic headline earnings                     391 666            347 829
Weighted average number of                                
shares ('000)                               187 330            185 900
Headline earnings per share                               
(cents)                                       209,1              187,1
Diluted headline earnings per                             
share (cents)                                 205,6              183,8


Group statement of financial position
                                            Audited            Audited
                                          12 months          12 months
                                        28 February        28 February
                                               2015               2014
                                              R'000              R'000
ASSETS                                                    
Non-current assets                                        
Property, plant and equipment             2 171 829          1 841 611
Intangible assets                           795 098            763 671
Investment in associates and joint                        
ventures                                     10 708                  -
Deferred income tax assets                   43 136             37 509
Non-current inventories                      90 668                  -
Non-current trade and other                               
receivables                                 129 355                  -
Total non-current assets                  3 240 794          2 642 791
Current assets                                            
Inventories                                 438 330            420 240
Construction contracts in progress                        
and retentions                              362 351            322 590
Trade and other receivables               1 253 668          1 068 410
Current income tax receivable                40 964             28 671
Cash and cash equivalents                   937 275            871 260
Total current assets                      3 032 588          2 711 171
Total assets                              6 273 382          5 353 962
EQUITY                                                    
Share capital                                 1 873              1 859
Share premium                             2 179 613          2 179 613
Other reserves                           (1 140 762         (1 104 240)
Retained earnings                         2 381 905          2 109 193
Equity attributable to owners of                          
the parent                                3 422 629          3 186 425
Non-controlling interest                    110 788             54 612
Total equity                              3 533 417          3 241 037
LIABILITIES
Non-current liabilities
Borrowings                                  672 320            429 961
Provisions for liabilities and                             
charges                                      54 253             34 675
Deferred income tax liabilities             311 621            266 464
Other financial liabilities                  77 262                  -
Total non-current liabilities             1 115 456            731 100
Current liabilities                                        
Trade and other payables                  1 170 248          1 075 529
Borrowings                                  427 620            287 600
Current income tax liabilities               26 641             18 696
Total current liabilities                 1 624 509          1 381 825
Total liabilities                         2 739 965          2 112 925
Total equity and liabilities              6 273 382          5 353 962


Group statement of changes in equity
                                          Share          Share          Other        Retained 
                                        capital        premium       reserves        earnings
                                          R'000          R'000          R'000           R'000
Balance at 1 March 2013                   1 845      2 179 613     (1 112 515)      1 850 616
Shares issued in terms of                          
equity-settled share option                        
scheme                                       14              -        (23 767)         23 767
Share option reserve                          -              -         27 354               -
Acquisition of non-controlling                                       
interest                                      -              -              -          (1 971)
Total comprehensive income for                                       
the year                                      -              -          4 688         357 616
Dividends paid                                -              -              -        (120 835)
Balance at 28 February 2014               1 859      2 179 613     (1 104 240)      2 109 193
Shares issued in terms of                          
equity-settled share option                        
scheme                                       14              -        (16 242)         16 242
Share option reserve                          -              -         27 797               -
Put option written on                                      
non-controlling interest                      -              -        (48 459)              -
Non-controlling interest arising on                        
business combination                          -              -              -               -
Acquisition of non-controlling                             
interest                                      -              -              -         (12 099)
Total comprehensive income for                             
the year                                      -              -            382         399 700
Dividends paid                                -              -              -        (131 131)
Balance at 28 February 2015               1 873      2 179 613     (1 140 762)      2 381 905


Group statement of changes in equity
                                               Total 
                                        attributable
                                           to owners             Non-
                                       of the parent      controlling            Total
                                             company         interest           equity
                                               R'000            R'000            R'000
Balance at 1 March 2013                    2 919 559           39 031        2 958 590
Shares issued in terms of               
equity-settled share option             
scheme                                            14                -               14
Share option reserve                          27 354                -           27 354
Acquisition of non-controlling
interest                                      (1 971)          (6 214)          (8 185)
Total comprehensive income for                                       
the year                                     362 304           24 103          386 407
Dividends paid                              (120 835)          (2 308)        (123 143)
Balance at 28 February 2014                3 186 425            54 612       3 241 037
Shares issued in terms of
equity-settled share option
scheme                                            14                 -              14
Share option reserve                          27 797                 -          27 797
Put option written on                                              
non-controlling interest                     (48 459)                -         (48 459)
Non-controlling interest arising on                                
business combination                               -            61 376          61 376
Acquisition of non-controlling                                     
interest                                     (12 099)             (195)        (12 294)
Total comprehensive income for                                     
the year                                     400 082            28 237         428 319
Dividends paid                              (131 131)          (33 242)       (164 373)
Balance at 28 February 2015                3 422 629           110 788       3 533 417


Group statement of cash flows
                                          Audited           Audited
                                        12 months         12 months
                                      28 February       28 February
                                             2015              2014
                                            R'000             R'000
Cash flows from operating
activities
Cash generated from operations            785 053           751 420
Finance income                             46 520            38 749
Finance costs                             (57 900)          (44 162)
Income tax paid                          (188 848)         (136 438)
Net cash generated from                                   
operating activities                      584 825           609 569
Cash flows from investing
activities
Purchases of property, plant 
and equipment                             (510 599)         (483 299)
Proceeds from sale of property,                          
plant and equipment                        40 267            52 839
Acquisition of subsidiaries              (202 485)         (115 040)
Loans granted to associates                           
and joint ventures                        (10 500)                -
Net cash used in investing                               
activities                               (683 317)         (545 500)
Cash flows from financing
activities
Proceeds from borrowings                  752 827           504 253
Repayment of borrowings                  (411 642)         (404 319)
Proceeds from shares issued                    14                14
Dividends paid to owners                            
of the parent                            (131 131)         (120 835)
Dividends paid to non-controlling       
interests                                 (33 242)           (2 308)
Acquisition of interest in             
a subsidiary                              (12 294)           (8 185)
Net cash generated from/(used in)       
financing activities                      164 532           (31 380)
Net increase in cash and            
cash equivalents                           66 040            32 689
Cash and cash equivalents at         
the beginning of the year                 871 260           835 685
Effects of exchange rates on 
cash and cash equivalents                     (25)            2 886
Cash and cash equivalents at 
the end of the year                       937 275           871 260


Group segmental analysis
                                                           Road             
                                                      surfacing                
                                                            and                Road    
                                                      rehabili-        construction
                                       Materials         tation      and earthworks
                                           R'000          R'000               R'000
Reportable segments
28 February 2015
Segment revenue                        1 961 342      2 568 538           1 463 953
Segment result (operating profit)        323 640        192 462              55 169
Margin                                      16,5%           7,5%                3,8%
28 February 2014
Segment revenue                        1 624 577      2 505 115           1 179 805
Segment result (operating profit)        259 152        209 260              40 026
Margin                                      16,0%           8,4%                3,4%


Group segmental analysis
                                          Infra-                           Consoli-
                                       structure          Tosas               dated
                                           R'000          R'000               R'000
Reportable segments
28 February 2015
Segment revenue                          862 660        388 766           7 245 259
Segment result (operating profit)         39 649         11 251             622 171
Margin                                       4,6%           2,9%                8,6%
28 February 2014
Segment revenue                          730 759        284 756           6 325 012
Segment result (operating profit)         36 966         (5 529)            539 875
Margin                                       5,1%         (1,9%)                8,5%


                                           Local       Interna-            Consoli-
                                                         tional               dated
                                           R'000          R'000               R'000
Geographical information                
28 February 2015                        
Segment revenue                        6 606 290        638 969           7 245 259
Segment result (operating profit)        538 722         83 449             622 171
Margin                                       8,2%          13,1%                8,6%
28 February 2014                        
Segment revenue                        5 890 468        434 544           6 325 012
Segment result (operating profit)        459 116         80 759             539 875
Margin                                       7,8%          18,6%                8,5%

                                        
Additional information                  
Employee benefit expense                 
                                          Audited             Audited
                                        12 months           12 months
                                      28 February         28 February
                                             2015                2014
                                            R'000               R'000
Employee benefit expense in the                         
income statement consists of:                           
Salaries, wages and contributions       1 648 079           1 436 923
Share options granted to                                
employees                                  27 797              27 354
Total employee benefit expense          1 675 876           1 464 277


Capital expenditure and depreciation     
                                          Audited             Audited
                                        12 months           12 months
                                      28 February         28 February
                                             2015                2014
                                            R'000               R'000
Capital expenditure for the year          510 599             483 299
Depreciation for the year                 334 997             282 968
Amortisation of intangible assets                        
for the year                                  280                 280


NOTES

Basis of preparation
The summary consolidated financial statements are prepared in accordance with the requirements 
of the JSE Limited Listings Requirements for abridged reports, and the requirements of the 
Companies Act applicable to summary financial statements. The Listings Requirements require 
abridged reports to be prepared in accordance with the framework concepts and the measurement 
and recognition requirements of International Financial Reporting Standards ("IFRS") and the
SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial 
Pronouncements as issued by the Financial Reporting Standards Council and to also, as a minimum, 
contain the information required by IAS 34 Interim Financial Reporting. The accounting policies 
applied in the preparation of the consolidated financial statements from which the summary 
consolidated financial statements were derived are in terms of International Financial Reporting 
Standards and are consistent with those accounting policies applied in the preparation of the 
previous consolidated annual financial statements.

These summary consolidated financial statements for the year ended 28 February 2015 have been 
prepared under the supervision of the Financial Director, Mr JF Gibson CA(SA) and audited by 
PricewaterhouseCoopers Inc., who expressed an unmodified opinion thereon. The auditor also 
expressed an unmodified opinion on the annual financial statements from which these summary 
consolidated financial statements were derived. A copy of the auditor's report on the summary
consolidated financial statements and of the auditor's report on the annual consolidated financial 
statements are available for inspection at the Company's registered office.

The auditor's report does not necessarily report on all of the information contained in this 
announcement. Any reference to pro forma or future financial information included in this 
announcement has not been reviewed or reported on by the auditors. Shareholders are advised that 
in order to obtain a full understanding of the nature of the auditors' engagement they should obtain 
a copy of that report together with the accompanying financial information from the Company's
registered office.

Business combinations
Shisalanga Construction (Pty) Ltd ("Shisalanga")
On 1 June 2014 the Group acquired 60% of the issued share capital and obtained control of Shisalanga 
for a purchase price of R38,4 million settled in cash. Shisalanga manufactures a range of asphalt 
products from its plants based in Northern KwaZulu-Natal.

The revenue included in the consolidated income statement since 1 June 2014 contributed by Shisalanga 
was R101,7 million with a net profit contribution of R7,0 million over the same period. Had Shisalanga 
been consolidated from 1 March 2014 the consolidated income statement would show pro forma revenue of 
R123,1 million and net profit of R4,3 million.

OMV Stilfontein (Pty) Ltd and OMV Gypsum Potchefstroom (Pty) Ltd ("OMV")
On 1 July 2014 the Group acquired a 70% interest in OMV's aggregate crushing and ready-mix concrete 
operations situated near Stilfontein and a 70% interest in OMV's gypsum operations situated near 
Potchefstroom in the North West province for a purchase price of R70,3 million settled in cash. 
An additional contingent consideration is payable dependent on future earnings and a put option 
has been written on the remaining 30% in favour of the non-controlling interest. The contingent 
consideration liability has been valued at R18,9 million and the put option liability at R48,5 million.

The revenue included in the consolidated income statement since 1 July 2014 contributed by OMV was 
R89,2 million with a net profit contribution of R9,2 million over the same period. Had OMV been 
consolidated from 1 March 2014 the consolidated income statement would show pro forma revenue of 
R147,1 million and net profit of R12,4 million.

Buildmax Aggregates and Quarries (Pty) Ltd ("BAQ")
On 1 September 2014 the Group acquired certain business operations and assets from BAQ for a 
purchase price of R59,7 million in cash. The business combination acquired comprises the sand 
quarry operations of Crushco Quarry and Alpha Sand Quarry and the aggregate crushing operations 
of Aflease. These operations will give the Group a more diversified product range in the form 
of building and plaster sand to add to its existing range of aggregates and are located in
the Gauteng province.

The revenue included in the consolidated income statement since 1 September 2014 contributed by 
BAQ was R53,3 million with a net profit contribution of R6,2 million over the same period. Had 
BAQ been consolidated from 1 March 2014 the consolidated income statement would show pro forma 
revenue of R98,9 million and net profit of R13,5 million.

Prodev Plant Hire (Pty) Ltd ("Prodev")
On 1 September 2014 Burma Plant Hire (Pty) Ltd acquired 100% of the issued share capital of 
Prodev for R31 million cash. Prodev is a plant hire company operating in Namibia and the 
acquisition of this business will increase the Group's presence in Namibia.

The revenue included in the consolidated income statement since 1 September 2014 contributed 
by Prodev was R22,9 million with a net profit contribution of R4,9 million over the same period. 
Had Prodev been consolidated from 1 March 2014 the consolidated income statement would show 
pro forma revenue of R38,1 million and net profit of R10,0 million.

Empa Structures CC and Empa Plant CC ("Empa")
On 1 November 2014 the Group acquired a 70% interest in Empa for R25,5 million cash. The company 
specialises in the construction of concrete structures with its main focus on construction of 
water treatment plants, waste water treatment plants, reservoirs and bridges.

The revenue included in the consolidated income statement since 1 November 2014 contributed 
by Empa was R48,0 million with a net profit contribution of R1,1 million over the same period. 
Had Empa been consolidated from 1 March 2014 the consolidated income statement would show 
pro forma revenue of R152,6 million and net profit of R1,1 million.

Details of the net assets acquired, purchase consideration and goodwill are set out below:

                                               Shisa           OMV           BAQ
                                               R'000         R'000         R'000
Consideration                                 
Cash                                          38 400        70 284        59 695
Contingent consideration (fair                
value)                                             -        18 874             -
Total consideration                           38 400        89 158        59 695
Recognised amounts of                         
identifiable assets acquired and              
liabilities assumed                           
Property, plant and equipment                 34 070        35 159        54 761
Deferred tax asset                             3 420             -         3 756
Non-current inventories                            -        95 184             -
Inventories                                      762        11 253         4 934
Construction contracts in progress               990             -             -
Trade and other receivables                   34 765        22 195         3 764
Current income tax receivable                    490             -             -
Cash and cash equivalents                      8 209         5 549             -
Borrowings                                   (28 739)       (4 484)            -
Provision for liabilities and charges              -             -       (13 415)
Deferred tax liability                        (5 025)      (37 378)            -
Current income tax liability                       -             -             -
Trade and other payables                      (7 430)      (10 824)            -
Total identifiable net assets                 41 512       116 654        53 800
Non-controlling interest                     (16 605)      (34 996)            -
Goodwill attributable to owners of            
the parent                                    13 493         7 500         5 895
Goodwill attributable to                      
non-controlling interests                          -             -             -
Total                                         38 400        89 158        59 695
Purchased consideration settled in        
cash                                          38 400        70 284        59 695
Less: Cash and cash equivalents               (8 209)       (5 549)            -
Cash outflow on acquisition for           
cash flow statement                           30 191        64 735        59 695
                                         
                                         
                                              Prodev          Empa         Total
                                               R'000         R'000         R'000
Consideration                               
Cash                                          31 000        25 490       224 869
Contingent consideration (fair              
value)                                             -         2 136        21 010
Total consideration                           31 000        27 626       245 879
Recognised amounts of                       
identifiable assets acquired and            
liabilities assumed                         
Property, plant and equipment                 31 000        29 680       184 670
Deferred tax asset                                 -         1 372         8 548
Non-current inventories                            -             -        95 184
Inventories                                        -         1 612        18 561
Construction contracts in progress                 -        12 026        13 016
Trade and other receivables                        -        25 701        86 425
Current income tax receivable                      -             -           490
Cash and cash equivalents                          -         8 626        22 384
Borrowings                                         -        (7 972)      (41 195)
Provision for liabilities and charges              -             -       (13 415)
Deferred tax liability                        (3 999)       (6 214)      (52 616)
Current income tax liability                       -        (1 671)       (1 671)
Trade and other payables                           -       (26 578)      (44 832)
Total identifiable net assets                 27 001        36 582       275 549
Non-controlling interest                           -       (10 975)      (62 576)
Goodwill attributable to owners of       
the parent                                     2 799         2 019        31 706
Goodwill attributable to                 
non-controlling interests                      1 200             -         1 200
Total                                         31 000        27 626       245 879
Purchased consideration settled in       
cash                                          31 000        25 490       224 869
Less: Cash and cash equivalents                    -        (8 626)      (22 384)
Cash outflow on acquisition for          
cash flow statement                           31 000        16 864       202 485
                                         

Events after the reporting period
Belabela Quarries (Pty) Ltd
On 18 April 2015 the Group effectively acquired 74% of Belabela Quarries (Pty) Ltd ("Belabela"), 
through its subsidiary Loop en Hoop (Pty) Ltd for a purchase price of R43 million to be settled 
in cash. Belabela is a commercial quarry operating on the outskirts of Gaborone in Botswana. 
The acquisition will give the Group a base from which it can expand and further develop its
operating model in Botswana.

Buildmax Aggregates and Quarries (Pty) Ltd
On 10 March 2015 the Group acquired certain mining rights and properties for an aggregate 
sum of R37 million in cash from the former owners of the businesses of Buildmax Aggregates 
and Quarries (Pty) Ltd.


COMMENTARY

Financial overview
Revenue increased 14,5% to R7,25 billion and operating profit increased by 15,2% to R622,2 million 
from the corresponding prior year. These results were supported by positive contributions from 
acquisitions concluded during the year and a strong performance from the Group's materials division 
which contributed 52,0% to total operating profit. The road construction divisions experienced a 
stable but challenging year due to persistent competitive pressures in this sector.

Profit before tax increased 13,5% to R606,6 million (2014: R534,5 million) with the effective tax 
rate increasing to 29,4% from 29,0%.

Earnings per share increased 11,6% to 213,4 cents with headline earnings per share increasing 
11,8% to 209,1 cents.

Group operating profit margin remained flat at 8,6% (2014: 8,5%).

Cash generated from operations increased 4,5% to R785,1 million (2014: R751,4 million) before 
finance charges and taxation.

Net finance costs increased to R15,7 million (2014: R5,4 million) due to increased borrowings 
and non-cash finance costs of R2,7 million relating to the unwinding of discount in the valuation 
of the contingent consideration and put option granted to the sellers of OMV. Total non-cash 
finance costs amounted to R4,4 million for the year.

Trade and other receivables increased by 29,5% to R1,38 billion due mainly to the acquisitions 
concluded during the year and also the inclusion of plant accounted for as receivables under 
finance leases.

Inventories increased by 25,9% to R529,0 million due mainly to the inclusion of the mine dumps 
at Stilfontein and the gypsum dump at Potchefstroom on the acquisition of OMV. The value of 
bitumen stock on hand decreased due to the lower bitumen price which tracks international fuel 
oil prices.

Borrowings increased 53,3% to R1,10 billion (2014: R717,6 million) due mainly to the financing 
of plant and equipment for the Tschudi copper mine project in Namibia and also the Buildmax and 
Prodev assets acquired.

Capital expenditure on property, plant and equipment increased 5,6% to R510,6 million 
(2014: R483,3 million).

The Group's net cash inflow for the year was R66,0 million. Total cash and cash equivalents at 
the end of the year increased 7,6% to R937,3 million (2014: R871,3 million).

Operational overview
Materials
The materials division, which includes the Raumix operations, comprises three main disciplines 
including commercial quarries, contract crushing and materials handling and processing for the 
mining industry.

The division delivered a strong organic performance for the year and also successfully bedded 
down the acquisitions of OMV crushers and the Buildmax Aggregates quarries, which contributed 
positively to earnings. The commercial quarries reported solid results for the year with healthy
demand experienced from the residential and commercial building markets as well as infrastructure 
projects. Conditions also favoured the mining and material handling operations where good results 
were reported despite being affected by a three-week strike at the Namdeb operations in Namibia, 
which was successfully resolved before year end. In line with the South African construction sector, 
contract crushing operations have been operating under competitive conditions and were negatively 
affected in Mozambique by a one-month production loss due to flooding in the northern region of 
the country.

Revenue for the division increased 20,7% to R1,96 billion (2014: R1,62 billion) and operating profit 
increased by 24,9% to R323,6 million (2014: R259,2 million).

The divisional operating profit margins increased to 16,5% (2014: 16,0%).

The division incurred capital expenditure of R358,3 million during the year (2014: R320,3 million).

The division has a secured order book of R1,86 billion (2014: R1,67 billion).

Road surfacing and rehabilitation
This division specialises in the manufacturing and laying of asphalt, chip and spray, surface 
dressing, enrichments and slurry seals.

The division delivered a stable performance for the year in an operating environment that remains 
very competitive. Increased competition in the asphalt market and a lower volume of work awarded 
in the KwaZulu-Natal provincial market made for particularly challenging conditions. However, 
margins have stabilised at the current levels. The division has increased its order book which 
includes contracts from SANRAL, the N3 Toll Concession and provincial work in the Western and 
Eastern Cape. Asphalt margins improved slightly during the year supported by the acquisition of 
Shisalanga Construction.

Revenue for the division increased 2,5% to R2,57 billion (2014: R2,51 billion) with operating 
profit decreasing by 8,0% to R192,5 million (2014: R209,3 million).

The divisional operating profit margin decreased to 7,5% (2014: 8,4%).

The division incurred capital expenditure of R63,4 million during the year (2014: R85,5 million).

The division has a secured order book of R2,47 billion (2014: R1,78 billion).

Road construction and earthworks
This division is the road and civil infrastructure construction division focused on the key 
areas of new road construction and heavy road rehabilitation.

The division delivered an improved performance for the year in an operating environment that 
remains very competitive. Management has focused its attention on production monitoring and 
driving efficiencies across the business units to ensure that the low margin work available 
is executed profitably. The progress made on projects in Namibia and Zambia also supported 
these results. The divisional order book grew significantly following the awards of significant
contracts from both SANRAL in South Africa and the Roads Development Agency in Zambia during 
the year.

Revenue for the division increased 24,1% to R1,46 billion (2014: R1,18 billion) with operating 
profit increasing 37,8% to R55,2 million (2014: R40,0 million).

The divisional operating profit margins increased to 3,8% (2014: 3,4%) with a marked improvement 
in the last six months due to a number of lower margin contracts being substantially completed 
in the first half.

The division incurred capital expenditure of R44,6 million during the year (2014: R51,2 million).

The division has a secured order book of R3,20 billion (2014: R2,07 billion) with R1,49 billion 
relating to contracts in Zambia and Namibia.

Raubex Infrastructure
The infrastructure division specialises in disciplines outside of the road construction sector, 
including energy (with a specific focus on renewable energy), rail, telecommunications, pipeline 
construction and housing infrastructure projects. 

The division has established its reputation in the market and is supported by a stable order book 
of work mainly focused on civil construction works related to Eskom's Renewable Energy Independent 
Power Producer Procurement Programme ("REIPPPP"), residential housing solutions, mine housing solutions 
and water pipeline infrastructure. The division successfully completed work on two second round 
photovoltaic ("PV") solar farms during the first half of the year but the delays experienced in 
reaching financial closure on round 3 REIPPPP projects pushed the order book out into the new year 
and impacted the second half performance. The acquisition of Empa Structures has been bedded down 
and will strengthen the Group's own capacity to tender on projects that require specialist concrete 
structure work.

Revenue for the division increased 18,0% to R862,7 million (2014: R730,8 million) and operating profit 
increased 7,3% to R39,6 million (2014: R37,0 million).

The divisional operating profit margins decreased to 4,6% (2014: 5,1%).

The division incurred capital expenditure of R37,7 million (2014: R22,8 million).

The division has a secured order book of R1,01 billion (2014: R909,4 million).

Tosas
Tosas is a manufacturer and distributor of value added bituminous products used primarily for
road construction activities. 

The company made good progress during the year and returned to profitability through a combination 
of "right sizing" initiatives and increased volume through improved marketing and service delivery. 
The modified bitumen industry is experiencing challenging trading conditions and margins pressure 
as new entrants compete for market share. The Group has continued to realise synergies from this 
acquisition through the efficient supply of bitumen on internal contracts.

Revenue for Tosas increased 36,5% to R388,8 million (2014: R284,8 million) with an operating 
profit of R11,3 million from a loss of R5,5 million reported in the prior year. Total revenue 
including internal supply to the Group amounted to R696,1 million (2014: R411,5 million).

Tosas has secured an external order book of R129,4 million (2014: R127,2 million).

Tosas incurred capital expenditure of R6,6 million (2014: R3,5 million).

International
The Group's international operations ("Africa") reported stable results for the year supported 
by the Namibian operations where work on the upgrading of the road from Rosh Pinah to Oranjemund 
is under way as well as various material handling contracts across the country. Material handling 
operations were adversely affected in the second half of the year by a three-week strike at the 
Namdeb operations in Namibia, while flooding in Northern Mozambique affected contract crushing 
operations. In Zambia work commenced on two Link 8000 contracts with activities limited to site 
establishment, planning and minor works. Major construction works in Zambia are set to commence 
in the year ahead.

Internationally, revenue increased 47,0% to R639,0 million (2014: R434,5 million) and operating 
profit increased by 3,3% to R83,4 million (2014: R80,8 million).

Operating profit margins decreased to 13,1% (2014: 18,6%) due mainly to the Rosh Pinah to 
Oranjemund contract being at lower margin, more in line with the South African road 
construction market. The strike in Namibia and flooding in Mozambique put pressure 
on the materials division margins.

Prospects
The Group has grown its order book by 32,5% to R8,68 billion (2014: R6,55 billion) with 25,4% 
of the order book now representing contracts in Africa. With a healthy short-term order book 
secured, the Group will now focus on effective execution of current contracts and selective 
tendering for replacement work.

A number of earnings enhancing acquisitions were bedded down during the year and the Group 
will continue to look for acquisitions in the materials sector in the year ahead. In line 
with this strategy, the Group acquired the Belabela quarry in Gaborone, Botswana on 
18 April 2015. This acquisition will give the Group a platform for expansion in the 
Botswana market.

Whilst mindful of the constant risks associated with industrial action in South Africa and 
the effect of commodity prices on the mining industry, the Group expects healthy operating 
conditions to continue in the materials sector.

Raubex's drive to diversify the Group's revenue streams over the past few years has resulted
in the materials division now contributing over 50% of the Group's total earnings and the 
successful development of the infrastructure division. This, together with the higher margin 
work secured in Zambia, positions the Group well to navigate the challenging conditions in the 
South African construction market and deliver growth in the year ahead.

Dividend declaration
The directors have declared a gross final cash dividend from income reserves of 36 cents per 
share on 11 May 2015 for the year ended 28 February 2015. The salient dates for the payment 
of the dividend are as follows:
Last day to trade cum dividend                           Friday, 29 May 2015
Commence trading ex dividend                             Monday, 1 June 2015
Record date                                              Friday, 5 June 2015
Payment date                                             Monday, 8 June 2015

No share certificates may be dematerialised or rematerialised between Monday, 1 June 2015 
and Friday, 5 June 2015, both dates inclusive.

In terms of Dividends Tax ("DT"), the following additional information is disclosed:
- The local DT rate is 15%.
- The number of ordinary shares in issue at the date of this declaration is 187 330 165.
- The dividend to utilise for determining the DT due is 36 cents per share.
- The DT amounts to 5,40 cents per share.
- The net local dividend amount is 30,60 cents per share for shareholders liable to pay the DT.
- Raubex Group Limited's income tax reference number is 9370/905/151.

In terms of the DT legislation, the DT amount due will be withheld and paid over to the South 
African Revenue Service by a nominee company, stockbroker or Central Security Depository Participant 
(collectively "Regulated Intermediary") on behalf of shareholders. All shareholders should declare 
their status to their Regulated Intermediary, as they may qualify for a reduced DT rate or exemption.

On behalf of the Board:

JE Raubenheimer
Chairman

RJ Fourie
Chief Executive Officer

JF Gibson
Financial Director

11 May 2015

Directors
JE Raubenheimer# 
RJ Fourie 
JF Gibson
F Kenney#
LA Maxwell* 
BH Kent*
NF Msiza*
# Non-executive 
* Independent non-executive

Company secretary
Mrs HE Ernst

Registered office
The Highgrove Office Park
Building No 1
Tegel Avenue
Centurion
South Africa

Transfer secretaries
Computershare Investor Services (Pty) Ltd
70 Marshall Street
Johannesburg
2001
South Africa

Auditors
PricewaterhouseCoopers Inc.

Sponsor
Investec Bank Limited

www.raubex.com



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