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Reviewed Provisional Results for the year ended 28 February 2015, Withdrawal and Renewal of Cautionary Announcement
VISUAL INTERNATIONAL HOLDINGS LIMITED
(Formerly Presto Financing Proprietary Limited)
(Incorporated in the Republic of South Africa)
(Registration number 2006/030975/06)
(“the Company” or “Visual”)
ISIN Code: ZAE000187407 Share code: VIS
REVIEWED PROVISIONAL RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2015, WITHDRAWAL AND
RENEWAL OF CAUTIONARY ANNOUNCEMENT
Condensed Statement of Financial Position as at 28 February 2015
28 February 28 February
2015 2014
Reviewed Audited
Assets
Non-Current Assets
Investment property 41 908 820 41 368 820
Property, plant and equipment 919 279 1 047 980
Intangible assets 47 868 6 446
Investment in joint ventures 1 352 449 711 251
Loan to group companies - 958 291
Loans to shareholders 42 532 616 44 266 991
Other financial assets 425 782 479 282
87 186 814 88 839 061
Current Assets
Inventories 40 246 180 40 246 180
Loans to group companies 871 802 -
Loans to shareholders - 1 330 000
Current tax receivable 256 331 -
Trade and other receivables 443 881 294 730
Cash and cash equivalents 877 920 257 864
42 696 114 42 128 774
Total Assets 129 882 928 130 967 835
Equity and Liabilities
Equity
Share capital 68 365 080 56 264 571
Retained income 5 359 867 13 078 667
Equity Attributable to Equity Holders of Parent 73 724 947 69 343 238
Non-controlling interest (456 218) (426 222)
73 268 729 68 917 016
Liabilities
Non-Current Liabilities
Loans from shareholders 14 353 931 17 168 364
Other financial liabilities 20 157 628 11 986 853
Operating lease liability 19 091 25 476
Deferred tax 8 517 304 10 562 142
43 047 954 39 742 835
Current Liabilities
Loans from shareholders 4 945 210 5 822 724
Other financial liabilities 5 362 913 8 638 590
Current tax payable 1 157 367 4 029 335
Trade and other payables 1 114 925 2 380 461
Provisions - 977 731
Bank overdraft 985 830 459 143
13 566 245 22 307 984
Total Liabilities 56 614 199 62 050 819
Total Equity and Liabilities 129 882 928 130 967 835
Net asset value per share (cents) 34.23 36.61
Net tangible asset value per share (cents) 34.21 36.60
Condensed Statement of Comprehensive Income
28 February 28 February
2015 2014
Reviewed Audited
Revenue 2 771 299 2 768 340
Cost of sales (428 575) (351 756)
Gross profit 2 342 724 2 416 584
Other income 691 791 32 497 005
Operating expenses (11 685 647) (9 894 324)
Operating (loss)/profit (8 651 132) 25 019 265
Investment revenue 2 974 926 1 629 365
Fair value adjustments 720 252 335 000
(Loss)/income from equity accounted investments 641 198 (545 959)
Finance costs (4 642 288) (2 994 849)
(Loss)/Profit before taxation (8 957 044) 23 442 822
Taxation 1 208 241 (9 978 791)
(Loss)/profit for the period (7 748 803) 13 464 031
Other comprehensive income - -
Total comprehensive (loss)/income for the period (7 748 803) 13 464 031
Total comprehensive (loss)/income attributable to:
Owners of the parent (7 718 807) 13 607 563
Non-controlling interest (29 996) (143 532)
(7 748 803) 13 464 031
Profit/(loss) attributable to:
Owners of the parent (7 718 807) 13 607 563
Non-controlling interest – Continuing operations (29 996) (143 532)
(7 748 803) 13 464 031
Shares in issue at period end 215 383 400 189 458 775
Weighted average number of shares 208 237 178 124 816 627
(Loss)/earnings per share (cents) (3.71) 10.90
Diluted (loss)/earnings per share (3.71) 10.90
Headline earnings reconciliation
Net (loss)/profit for the period (7 718 807) 13 515 475
Adjustments:
Fair value adjustment on investment
properties (540 000) (335 000)
Tax effects on fair value adjustment 100 440 62 310
Fair value adjustment on loan (180 252)
Capital distribution received from trust - (27 000 000)
Headline loss for the period (8,338,619) (13 757 215)
Headline loss per share (cents) (4.00) (11.02)
Condensed Statement of Changes in Equity
Total
attributable
Retained to equity Non-
Share Share Total share income/ holders of controlling Total
capital premium Capital (loss) the group interest equity
R R R R R R R
Group
Balance at 1 March 2013 645 31 795 936 31 796 581 (7 192 405) 24 604 176 (282 690) 24 321 486
Profit for the year - - - 13 607 564 13 607 564 (143 532) 13 464 032
Other comprehensive income - - - - - - -
Total comprehensive income for the year - - - 13 607 564 13 607 564 (143 532) 13 464 032
Conversion to no par value shares 31 795 936 (31 795 936) - - - - -
Issue of shares 25 609 908 - 25 609 908 - 25 609 908 - 25 609 908
Capitalised costs on equity raising (1 141 918) - (1 141 918) - (1 141 918) - (1 141 918)
Gain on dilution of majority shareholder interest - - - 6 743 219 6 743 219 - 6 743 219
Other movements 23,007 23,007 23,007
Total contributions by and distributions to owners of 56 263 926 (31 795 936) 24 467 990 6 766 226 31 234 216 - 31 234 216
group recognised directly in equity
Balance at 1 March 2014 – previously reported 56 264 571 - 56 264 571 13 181 385 69 445 956 (426 222) 69 019 734
Previous year adjustments (102 718) (102 718)
Balance at 1 March 2014 – restated 13 078 667 68 917 016
Loss for the year - - - (7 718 800) (7 718 800) (29 996) (7,748,796)
Other comprehensive income - - - - - - -
Total comprehensive Loss for the year - - - (7 718 800) (7 718 800) (29 996) (7 748 796)
Issue of shares 12 401 891 - 12 401 891 - 12 401 891 - 12 401 891
Capitalised costs on equity raising (301 382) (301 382) (301 382) (301 382)
Total contributions by and distributions to owners of 12 100 509 - 12 100 509 - 12 100 509 - 12 100 509
group recognised directly in equity
Balance at 28 February 2015 68 365 080 - 68 365 080 5 359 867 73 724 947 (456 218) 73 268 729
Statement of Cash Flows
28 February 28 February
2015 2014
Reviewed Audited
Cash flows from operating activities
Cash used in operations (11 044 060) (3 789 414)
Interest income 1 876 114
Finance costs (2 901 911) (1 107 823)
Tax paid (3 964 896) (61 976)
Net cash used in operating activities (17 908 992) (4 959 099)
Cash flows from investing activities
Purchase of property, plant and equipment (109 258) (124 147)
Purchase of other intangible assets (55 123) -
Loans to joint venture repaid 220 000 45 000
Loans advanced to joint venture (70 000) (52 010)
Advances on loans included in other financial assets (132 324) (4 905 604)
Proceeds from loans included in other financial assets 185 824 6 121 688
Net cash from investing activities 39 119 1 084 927
Cash flows from financing activities
Proceeds on share issue 12 317 786 -
Proceeds from other financial liabilities 6 886 983 1 179 812
Repayment of other financial liabilities (2 951 720) (2 085 769)
Proceeds from shareholders loan 4 114 000 5 780 766
Repayment of shareholders loan (2 403 808) (1 236 840)
Net cash from financing activities 17 963 241 3 637 969
Total cash movement for the year 93 368 (236 203)
Cash at the beginning of the year (201 279) 34 924
Total cash at end of the year (107 910) (201 279)
BASIS OF PREPARATION
The board of directors presents its reviewed condensed consolidated results for the year ended 28
February 2015. The results have been prepared in accordance with the JSE Limited (“JSE”) Listings
Requirements and the framework concepts and the recognition and measurement requirements
of International Financial Reporting Standards (IFRS) and IAS 34 Interim Financial Reporting. The
accounting policies used in preparation of the year end results are in terms of IFRS and are
consistent with those applied in the preparation of the annual financial statements of the Group
for the year ended 28 February 2014. During the year under review, the group adopted all the
standards and interpretations that were effective and deemed applicable to the group. The
adoption of these standards did not have an effect on the current and prior year results. Full
details of the new standards and interpretations and the related disclosures will be included in the
consolidated audited annual financial statements of the group.
The reviewed results have been prepared by the financial director Mr G Noble (B.Comm) on the
basis of accounting policies applicable to a going concern. This basis presumes that funds will be
available to finance future operations and that the realisation of assets and settlement of
liabilities, contingent obligations and commitments will occur in the ordinary course of business.
The results have been reviewed by the Group’s auditors, Baker Tilly Greenwoods and their review
report, whilst unqualified has been modified with an emphasis of matter as set out below:
Emphasis of matter
“Without qualifying our conclusion, we draw attention to the going concern note set out in the
provisional condensed group financial statements which indicate that there are material
uncertainties that may cast significant doubt about the group’s ability to continue as a going
concern such that the group may be unable to realise its assets and discharge its liabilities in the
normal course of business.”
The independent review report is available for inspection at the Company’s registered office.
BACKGROUND, INCORPORATION AND NATURE OF BUSINESS
Visual was incorporated as a private company on 5 October 2006 under the name Presto
Financing Proprietary Limited. The company’s name was changed, and it was converted to a
public company, by way of special resolutions on 3 October 2013, which special resolutions were
registered by CIPC on 23 December 2013. Presto Financing Proprietary Limited was a dormant
subsidiary of Visual International until it was decided to use this group company as the new
holding company for the purposes of the listing. Visual then acquired the controlling interest in
Visual International from CKR Investment Trust with effect from 1 March 2012 and became the
holding company of the various Subsidiaries of Visual.
Visual, through the group, is essentially a property developer that acquires land, rezones the land,
installs the relevant services and then constructs houses and apartments on the land for sale to
homeowners or investors. Visual also holds some of the homes developed (27 units) which it rents
out to families and intends to grow this area going forward, potentially in partnership with one or
more large funds.
Visual International, the main subsidiary and previously held 100% directly by the CKR Investment
Trust, was established more than 20 years ago and has been involved in a number of premier
property development projects in South Africa over the past 14 years. In addition, a number of
property developments were undertaken by entities associated with CK Robertson and Visual
International, namely RAL Trust and My Place Trust, which properties were acquired by the Visual
Group during the year ended 28 February 2014 by way of a restructure in accordance with
Section 42 of the Income Tax Act ahead of the listing, termed inter-related acquisitions.
The additional properties and assets acquired subsequent to the prior year end of 28 February
2013 are summarised as follows:
- The acquisition of Erf 18363, Kuils River dated 18 October 2013 from RAL Trust, for a net
purchase consideration of R21 500 000 which was settled through the issue of 83 169 544
Shares in Visual;
- The acquisition of Erf 18358 and the remainder of farm 1286, Kuils River from RAL Trust dated
18 October 2013, for a net purchase consideration of R2 362 387 which was settled through
the issue of 7 706 987 Shares in Visual;
- The cancellation agreement dated 29 November 2013 with RAL Trust pursuant to the above
acquisitions from RAL Trust terminating the former development agreement and beneficiary
agreement with Visual International, resulting in a capital receipt of R32 million;
- An agreement was entered into on 15 February 2013 to purchase Erf 22887 with a fair value
of R2 155 774 from the My Place Trust in exchange for the issue of shares by Stellendale
Village to the amount of R6 600 000. The excess paid over the fair value of the asset acquired
was recognised as goodwill in terms of IFRS 3. The carrying amount of the asset to which
goodwill relates exceeded the recoverable amount, resulting in an impairment of goodwill.
On 20 January 2014 the agreement was cancelled and the aforementioned transaction
reversed. The property was substituted for Erf 24258, with a fair value of R7 350 000, with a
commensurate issue of shares by Stellendale Village;
- The agreement with My Place Trust for the acquisition of the remaining minority shareholding
of 10 shares in Stellendale Village dated 31 October 2013, for a net purchase consideration of
R215 587 which was settled through the issue of 703 325 Shares in Visual.
The underlying properties acquired by Visual were transferred through the Deeds Office during the
year ended 28 February 2015, ahead of the listing of the Company on 23 May 2014.
To date, close to 500 homes and apartments have been developed by Visual International at
Stellendale for the various Trusts and Clidet (a sister joint venture), with a further 449 units to be
constructed by Clidet.
FINANCIAL RESULTS COMMENTARY
Visual reports that the profit performance of the Group was not in line with expectations due to
the lumpy nature of revenue from property development, the delay in listing and subsequent
delay in commencement of development work due to town council approval only being
received during 2015, some nine months later than expected. Shareholders are reminded that
the Group was effectively brought together during the year ended 28 February 2014 and thus the
results for the year ended 28 February 2014 will not be comparable to 28 February 2015 and to the
results of the group going forward.
Other income is substantially lower than the prior year as Visual International used to be a
beneficiary of RAL Trust and My Place Trust and used to receive a distribution of profits from these
trusts, which was recognised in “Other Income”. A large portion of the Other Income in the prior
year arose as a result of a capital distribution received as part of the restructuring of and
acquisition of properties from inter-related parties ahead of the listing.
The executive team is currently in negotiations with a large contractor to finance a large portion
of development work planned for 2016 and all indications are that development funding will be in
place for the year ending 29 February 2016. Management is in the process of procuring funding
against assets held and have also started to sell off non-core assets to facilitate development
work in the absence of funding.
Operating expenses for the year ended 28 February 2015 were mostly in line with those of the
correlating prior period, with the exception of listing expenses, employee costs, the newly
appointed non-executive directors’ fees, legal fees, sponsor fees and auditors fees which were
higher than the prior year following the listing of the company on the Johannesburg Stock
Exchange in May 2014.
Investment revenue was higher due to interest received on funds raised in connection with the
listing, whilst finance charges were higher due to higher levels of borrowings associated with the
funding of the Group some of which were at bridging finance rates.
The taxation charge is at a rate of 13.49% due to the fact that deferred taxation has not been
recognised on losses incurred.
On the balance sheet, investment property and inventories remained in line with the prior year as
development work could not commence until planning approvals were received from the
relevant authorities. Other financial liabilities increased due to the securing of interim funding
whilst development funding and partners are secured.
Current liabilities also include a portion of a withholding tax liability due to SARS, which arose
during the restructure of the group ahead of the listing. Whilst R700 000 of this obligation has been
settled, approximately R1.1 million remains owing due to the current cash flow constraints. The
Company is making a formal arrangement with SARS to settle the remaining obligation over the
next six months, commencing 1 June 2015.
GOING CONCERN
The Group experienced cash flow complications during the year, partly due to the nature of the
business, which it addressed by borrowing from a lending institution at higher interest rates. The
cash flow complications resulted from the following events:
- The holding company of the group listed on the AltX of the JSE in May 2014. The full
subscription in the company's shares was not received, with only a third of the expected
capital being raised. As a result of the desired amount of capital not being raised, the
company was unable to fully implement its business plan and to undertake its planned
development projects. Furthermore, an agreement with a BBBEE group for the placement
of 32 million shares at 50 cents per share, which subscription was dependent on the entity
obtaining finance for the majority of the subscription amount, did not materialise as the
entity was not granted funding.
- Delays in being able to generate revenue from property development sales were also
experienced due to a nine month delay in approval of zonings and plan approvals from the
local authorities, substantially delaying the start of construction on Northbank 1.
The directors have considered the operational budget and cash flow forecasts for the ensuing
year which are based on the current expected economic and market conditions and the
happening of all (or at least a significant number) of the following events:
a) A large foreign engineering and construction company (“Constructco”) wishes to establish
itself in the construction and building fields in South Africa and elsewhere in Southern Africa,
and in certain instances it will be willing to provide development funding to its clients during
construction. Constructco is in discussions with Visual to assist with finding projects to construct,
preparing such projects so that Constructco can commence with building works, undertaking
some supervision during construction and assisting with the collection (i.e. repayment) of the
development funding after completion. Constructco and Visual plan that this long term joint
venture relationship will be launched with the building and the provision of development
funding for it of all four phases of Visual’s Stellendale Lifestyle Estate. Furthermore, a foreign
investor related to Constructco has expressed an interest in acquiring approximately 70 million
of Visual’s shares.
b) Visual is negotiating with various recognised property and investment funds about the
establishment with Visual of one or more middle income residential property investment funds
(“Newfunds”). If negotiations are concluded successfully, Visual will develop some of its
property projects for these Newfunds, hold a minority share in each of these Newfunds, and
undertake the management of the properties for these Newfunds. In certain instances the
Newfunds will acquire properties held by other developers, in which case Visual will receive
commission and management fees.
c) Currently Visual has zoning rights to develop approximately 250 houses on Erf 18358 and the
remainder of farm 1286. If the agreement with Constructco is concluded timeously,
Constructco will undertake the building and bridge funding thereof. Otherwise Visual plans to
sell, develop and bridge fund these houses on a plot and plan basis during the next calendar
year.
d) In addition to the discussions for the subscription with the foreign investor, management's
funding plans include:
i. Securing funding from normal banking sources for property development, which has
been the normal source of development funding of the group historically.
ii. The placement of additional shares in the market or with strategic partners, as funding
for expansion becomes necessary; management is currently negotiating with three
other parties (than the foreign investor) about subscribing for the approximately 70
million shares.
iii. The sale of undeveloped serviced land for an estimated consideration of R36 million.
iv. Returning to its original business model of “plot and plan” which proved successful
during the property downturn post 2008 and which will start realising revenue and
positive cash flow towards the end of the calendar year.
These events and the underlying assumptions relating thereto represent material uncertainties that
may cast doubt on the Group's ability to continue as a going concern. However, the directors
believe that some or all of the above mentioned transactions will materialise and that the Group
will have adequate financial resources to continue as a going concern. Accordingly, the directors
have adopted the going concern basis in the preparation of the annual financial statements.
It is noted that the group has more than R70 million in tangible net asset value and discussions with
local agents indicate that the property valuations reflected in the reported results are
conservative.
SEGMENTAL REPORTING
The segmental information is set out below:
The basis of segmentation and the measurement of segment profit/loss is consistent with the prior
period audited annual financial statements. The basis of segmentation of assets and liabilities has
been changed from the prior year.
The group currently has three reportable segments, as described below, which are the group's
strategic business units. The strategic business units offer different services and are reviewed by
management. For each of the strategic business units, the group's CEO reviews internal
management reports on at least a monthly basis. The following summary describes the operations
of each of the group's reportable segments for the years ended 28 February 2015 and 28 February
2014:
- Property Services segment - Rendering of management, administration and consulting
services on development projects
- Property Investment segment - Letting of residential properties held by the group
- Property Development segment - Development of residential properties held by the group
or sold to third parties.
Primary segment report - 2015 Property Property Property Total
Services Investment Development
Total revenue 1,025,734 1,745,565 - 2,771,299
External revenue 1,025,734 1,745,565 - 2,771,299
Segmental results (2,921,564) (6,170,021) - (9,091,585)
Other income - 691,792 - 691,792
Income from equity accounted
investments - 641,198 - 641,198
Investment income 1,101,102 1,873,824 - 2,974,926
Finance cost - (4,642,287) - (4,642,287)
Fair value adjustments - 720,252 - 720,252
Depreciation (93,028) (158,312) - (251,340)
Taxation 447,203 761,038 - 1,208,241
Profit/(Loss) for period (1,466,287) (6,282,516) - (7,748,803)
Total segment assets 515,561 44,101,871 40,246,180 84,863,612
Reportable segment operating
assets 515,561 44,101,871 40,246,180 84,863,612
Total segment liabilities 26,664 26,627,894 6,561,806 33,216,364
Reportable segment operating
liabilities 26,664 26,627,894 - 3,216,364
Capital expenditure - 164,381 - 164,381
Investment in joint venture - 1,352,449 - 1,352,449
Property Property Property
Primary segment report - 2014 Services Investment Development Total
Total revenue 1,035,496 1,732,844 - 2,768,340
External revenue 1,035,496 1,732,844 - 2,768,340
Segmental results (2,279,170) (4,773,180) - (7,052,350)
Other income 5,395,000 27,102,005 - 32,497,005
Loss from equity accounted - (545,859) - (545,859)
investment income
Investment 609,463 1,019,903 - 1,629,366
Finance cost - (2,994,849) - (2,994,849)
Fair value adjustments - 335,000 - 335,000
Depreciation (63,021) (105,462) - (168,483)
Provisions for penalties and (96,133) (160,874) - (257,007)
interest
Taxation (3,732,561) (6,246,230) - (9,978,791)
Profit/(Loss) for period (166,422) 13,630,454 - 13,464,032
Total segment assets 670,985 43,484,564 40,246,180 84,401,729
Reportable segment operating
assets 670,985 43,484,564 40,246,180 84,401,729
Total segment liabilities 0 23,031,380 6,785,278 29,816,658
Reportable segment operating
liabilities 0 23,031,380 6,785,278 29,816,658
Capital expenditure - 18,438,820 - 18,438,820
Investment in joint venture - 711,251 - 711,251
Reconciliation of assets 2015 2014
Segment operating assets 84,863,612 84,401,729
Investment in joint venture 1,352,449 711,251
Cash and cash equivalents 877,920 257,864
Current tax receivable 256,331 -
Loans to shareholder 42,532,616 45,596,991
129,882,928 130,967,835
Reconciliation of liabilities 2015 2014
Segment operating liabilities 33.216,364 29,816,658
Current tax payable 1,157,366 4,029,335
Deferred tax 8,517,304 10,562,142
Provisions 977,731
Bank overdraft 985,830 459,143
Loans from shareholder 12,737,335 16,205,810
56,614,199 62,050,819
Revenue from one customer amounted to R1 024 234 (2014: R1 015 496), arising from services
rendered by the Property Services segment.
Geographic information:
The group's revenue is derived from operations and property holding only in South Africa. The
group's non-current assets are also located in South Africa.
Segment revenue and expenses:
Revenue and expenses that are directly attributable to segments are allocated to those
segments. Those that are not directly attributable to segments are allocated on a reasonable
basis.
Segment assets and liabilities:
Segment assets and liabilities comprise those operating assets and liabilities that are directly
attributable to the segment or can be allocated to the segment on a reasonable basis. Segment
assets exclude investments, tax assets, bank balances, deposits and cash. Segment liabilities
exclude loans, bank overdraft and tax liabilities. Capital expenditure represents the local costs
incurred during the period to acquire segment assets that are expected to be used during more
than one period, namely, property, plant and equipment, investment property and intangible
assets other than goodwill.
RELATED PARTIES
Related parties are the same as reported in the previous period.
Related party transactions up until 28 February 2015 R
Interest paid to/(received from) related parties
Shareholders 1 689 665
Shareholder (2 910 345)
Company controlled by director 50 710
Joint venture (62 705)
Director 138 102
Close family member of director 22 500
Shareholders of subsidiaries 1 534 787
Rent paid to related parties
Trust of director (Diepwater Trust) 128 491
Salary paid to related party
Close family member of director 60 000
Management fees received from related parties
Companies controlled by directors (Clidet) 1 024 234
Raising fees paid to related parties
Shareholder of subsidiary 105 000
Legal fees paid to related parties
Companies controlled by close family member of director 475 260
Related party transactions up until 28 February 2014 R
Interest paid to/(received from) related parties
Trusts of directors (RAL Trust)
Trust of close family member of director 415 479
Shareholders 1 301 445
Shareholder (1 562 338)
Joint venture 66 913
Shareholders of subsidiaries 585 581
Salary paid to related party
Close family member of director 60 000
Rent paid to related party
Trust of director 118 973
Raising fees paid to/(received from) related parties
Shareholder of subsidiary 325 000
Trusts of close family member (325 000)
Management fees paid to/(received from) related parties
Companies controlled by directors (Clidet) (1 035 496)
Shareholder of subsidiary 70 000
Legal fees paid to related parties
Company of close family member of director (Van der Merwe & Robertson Inc.) 50 500
PROSPECTS
Going forward, most of the property development projects take place in Visual International,
whilst Stellendale Village houses the planned Stellendale Lifestyle Retirement development of
approximately 825 units.
The Stellendale 3 project was redesigned to enable a faster roll-out of approximately 250 single
residential houses on a plot and plan basis. It is anticipated that the first phase of Stellendale 3 of
approximately 83 units will be completed by 28 February 2016.
Hoeksteen Projects and Richland respectively hold land for future development at Machadadorp
and Richwood, although no development is planned or forecast on these two properties for the
year ending 28 February 2016. Mystic Pearl similarly holds two pieces of land for future
development in Hagley, with a joint venture partner. Due to the change in focus to larger
developments as detailed in subsequent events below, the Company may consider disposing of
some of its smaller properties during 2016.
Visual International has sold its 50% interest in Dream Weaver which owns under cover and open
parking bays at three buildings from which income is generated through leasing of parking bays,
with joint venture partners. The Company regarded this asset as non-core as previously
announced.
Due to the delay in one of the property transfers and the consequent delay in listing and receipt
of the proceeds raised, lodging of plans and commencement of construction of top structures
was delayed, which in turn has caused most of the planned sales and cost of sales to move into
the year ending 28 February 2016. On the positive side, the listing process has led to increased
interest in Visual, including certain of its larger projects as well as its data and contact centre
potential, which could lead to strategic partnerships being formed.
Visual has a positive net tangible asset value in excess of R70 million and the board will be
considering the size and nature of properties held in order to optimise the balance sheet for its key
development initiatives and ensure that it has sufficient cash and funding resources to grow the
group.
SHARE CAPITAL AND ISSUE/ REPURCHASE OF SHARES
Upon the listing of Visual on 23 May 2014 the company issued 22 301 021 shares at R0.50 per share
raising R11 150 510.50 for the offer and issued a further 1 123 604 shares for cash at 50 cents per
share during the period under review.
During the year under review, the Company did not repurchase any shares.
Subsequent to its listing, the Company has also placed a further 2 500 000 shares at a 10%
discount to the 30 day Volume Weighted Average price of 32.8 cents, as well as the following:
- 400,000 shares were issued to PHAB Properties Limited on 26 June 2014
- 123,604 shares were issued to PSG Clearwater clients and in settlement of liabilities on 26 June
2014
- 600,000 shares were issued to Prescient Wealth Management Proprietary Limited on 26 June
2014
DIVIDEND
The Company has not declared a dividend for period ended 28 February 2015 and in line with its
stated intention in the prospectus, the Company will not be considering a dividend payment for
the forthcoming year.
LITIGATION
There are no legal or arbitration proceedings, including any proceedings that are pending or
threatened, of which the company and group is aware that may have or have had in the last
12 months, a material effect on the company’s or the group’s financial position.
CONTINGENT LIABILITIES
At the reporting date the Group does not have any contingent liabilities (2014: RNil).
EVENTS AFTER THE REPORTING PERIOD
A joint venture of the group, Dream Weaver Trading Proprietary Limited, sold all its assets as a
going concern on 27 March 2015 for R5 350 000. Visual is a 50% shareholder in this joint venture.
There are no other material events that require reporting after the year end, other than in the
normal course of business. Shareholders are however referred to the withdrawal and renewal of
cautionary announcement below.
WITHDRAWAL AND RENEWAL OF CAUTIONARY ANNOUNCEMENT
As previously announced on SENS, shareholders are advised that Visual has signed a
Memorandum of Understanding for the development of Reebokfontein Village in Klerksdorp. The
drafting of the development agreement has been delayed due to internal negotiations between
the Klerksdorp partners and accordingly Visual is withdrawing the cautionary announcement until
the parties finalise their internal negotiations, where after Visual will proceed to enter into a formal
development agreement.
As previously announced, Visual’s focus is on securing an interest in a large development in
Gauteng together with a key funding partner. A further announcement will be made in due
course. Accordingly, shareholders are advised to continue to exercise caution until a further
announcement is made.
By order of the board
Johannesburg
29 May 2015
Sponsor
Arbor Capital Sponsors Proprietary Limited
Date: 29/05/2015 05:36:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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