Wrap Text
Unaudited interim results ended 30 June 2015
and declaration of scrip distribution with
a cash dividend alternative
Mpact Limited
(Incorporated in the Republic of South Africa)
(Company registration number 2004/025229/06)
Income tax number: 9003862175
JSE share code: MPT JSE ISIN: ZAE 000156501
("Mpact" or "the Group" or "the Company")
Unaudited interim results
for the six months ended 30 June 2015
and declaration of scrip distribution with
a cash dividend alternative
Highlights
REVENUE
UP 10.8%
to R4.4 billion
(June 2014: R4.0 billion)
RETURN ON CAPITAL EMPLOYED OF
17.9%
(June 2014: 16.9%)
UNDERLYING OPERATING PROFIT
UP 26.8%
to R342 million
(June 2014: R270 million)
INTERIM GROSS CASH DIVIDEND
UP 15.4%
to 30 cents per share
(June 2014: 26 cents per share)
BASIC UNDERLYING EARNINGS PER SHARE
UP 47.4%
to 135.3 cents
(June 2014: 91.8 cents)
B-BBEE RATING IMPROVED TO
Level 3
(Previously Level 5)
rPET project and phase 1 of the Felixton
mill rebuild were commissioned on time
and within budget
Company profile
Mpact is one of the leading paper and plastics packaging businesses in southern Africa, listed on the JSE's
Main Board in the Industrial – Paper and Packaging sector. The Group has a leading market position in southern
Africa in recovered paper collection, corrugated packaging, recycled-based cartonboard and containerboard,
polyethylene-terephthalate (PET) preforms, styrene trays and plastic jumbo bins. These leading market positions
allow Mpact to meet the increasing requirements of its customers, achieve economies of scale and cost
effectiveness at the various operations.
Mpact has 33 operating sites, of which 23 are manufacturing operations, in South Africa, Namibia, Mozambique,
Botswana and Zimbabwe. South African-based customers accounted for approximately 91% of Mpact's sales
for the current period while the balance was predominantly to customers in the rest of Africa.
As at 30 June 2015 Mpact employed 4,366 people.
Group performance
The Group delivered a pleasing set of results for the six months to 30 June 2015.
The results reflect an improved performance in Plastics following the successful restructure of the FMCG business
during 2014, good volume growth and a better operating profit margin, while the Paper business once again
delivered steady growth underpinned by increased sales to the fruit sector.
Earnings were enhanced by a lower effective tax rate compared to the same period last year.
Group revenue of R4.4 billion was 10.8% higher than the comparable prior year period, attributable mainly to
volume growth, a favourable sales mix and higher selling prices.
Underlying operating profit increased by 26.8% to R342 million and the operating profit margin increased to 7.8%
from 6.8%.
ROCE for the period improved to 17.9% (June 2014: 16.9%).
On 1 April 2015 Mpact announced the successful implementation of a Broad-Based Black Economic Empowerment
("B-BBEE") transaction. This contributed to an improved B-BBEE rating of Level 3 from Level 5.
The R350 million PET recycling (rPET) plant and the first phase of the R765 million upgrade of the Felixton mill
were commissioned on time and within budget. The next milestone in the rPET project is obtaining approval from
customers for the use of Mpact's rPET in the production of bottles, which is expected during the last quarter of
2015. The second phase of the Felixton mill upgrade is on track to be completed in 2017.
Paper business
In the Paper business revenue for the period was up 12.1% to R3.3 billion with organic sales volume growth of
2.4%. Acquisitions improved revenue by 1.3%. Underlying operating profit increased by 12.4% to R315.4 million
(June 2014: R280.7 million) due to higher selling prices and favourable product mix which were partially offset by
increased raw material costs.
Plastics business
Revenue in the Plastics business increased by 7.3% to R1.1 billion on the back of good volume growth in
all sectors, other than FMCG which declined following the restructuring in 2014. Underlying operating profit
increased by 98.9% to R87.3 million (June 2014: R43.9 million) with the operating profit margin increasing to
7.6% from 4.1%, benefiting from a favourable product mix and cost savings.
Net finance costs
Net finance costs reduced by 2.9% to R57.9 million (June 2014: R59.6 million). Higher interest rates on increased
average net debt over the period were offset by a non-recurring benefit received from the unwinding of an interest
rate swap and interest capitalised on projects.
Tax
The effective tax rate for the period was 21.1%. (June 2014: 30.0%). The lower effective tax rate is due mainly to
the recognition of deferred tax on previously unrecognised tax losses.
Earnings per share
Basic and underlying earnings per share increased by 47.4% to 135.3 cents (June 2014: 91.8 cents). Headline
earnings per share for the period was up by 46.9% to 134.4 cents (June 2014: 91.5 cents).
Net debt
Net debt at 30 June 2015 was R1.7 billion, an increase of 22.8% from 30 June 2014 due mainly to investments
in major capital projects. The gearing ratio was 34.2% (June 2014: 32.5%). The variable interest rate on an
existing R500 million facility was swapped to a fixed rate of 9.49% maturing on 23 December 2019. Effective
20 March 2015, Mpact secured an eight-year loan facility with the KZN Growth Fund of R200 million at a fixed
interest rate of 9.15%.
Outlook
Subdued economic conditions in South Africa will make it difficult to maintain similar levels of volume growth in
the second half. In addition, we are concerned about the level of inflation in input costs such as raw materials,
labour, electricity and administered services.
While it is not possible to predict the short-term consequences of the recent developments in the South African
paper packaging sector, we believe that our interventions such as the Felixton mill rebuild, rPET project and our
other investments in the recycling and corrugated businesses will ultimately improve our prospects.
Second half earnings will be impacted by costs associated with the start-up of the recently commissioned rPET
plant and Phase 1 of the Felixton mill rebuild.
It is anticipated that the effective tax rate for the full year will be at a similar level to the interim period.
Scrip distribution and cash dividend alternative
1. Introduction
Notice is hereby given that the Board has declared an interim distribution for the six months ended 30 June
2015, by way of the issue of fully-paid Mpact ordinary shares of no par value each ("the Scrip Distribution") as
a scrip distribution payable to ordinary shareholders ("Shareholders") recorded in the register of the Company
at the close of business on the Record Date, being Friday, 4 September 2015.
Shareholders will be entitled, in respect of all or part of their shareholding, to elect to receive a gross cash
dividend of 30 cents per ordinary share in lieu of the Scrip Distribution, which will be paid only to those
Shareholders who elect to receive the cash dividend, in respect of all or part of their shareholding, on or before
12:00 on Friday, 4 September 2015 ("the Cash Dividend").
The Cash Dividend has been declared from income reserves. A dividend withholding tax of 15% will be
applicable to all Shareholders not exempt therefrom, after deduction of which the net Cash Dividend is
25.50 cents per Mpact ordinary share.
The new ordinary shares will, pursuant to the Scrip Distribution, be settled by way of capitalisation of the
Company's distributable retained profits.
The Company's total number of issued ordinary shares as at 12 August 2015 is 165 331 235. Mpact's income
tax reference number is 9003862175.
2. Terms of the Scrip Distribution
The number of Scrip Distribution shares to which each of the Shareholders will become entitled pursuant to
the Scrip Distribution (to the extent that such Shareholders have not elected to receive the Cash Dividend) will
be determined by reference to such Shareholder's ordinary shareholding in Mpact (at the close of business
on the Record Date, being Friday, 4 September 2015 in relation to the ratio that 30 cents bears to the volume
weighted average price ("VWAP") of an ordinary Mpact share traded on the JSE during the 30-day trading
period ending on Thursday, 20 August 2015. Where the application of this ratio gives rise to a fraction of an
ordinary share, the number of shares will be rounded up to the nearest whole number, if the fraction is 0.5 or
more, and rounded down to the nearest whole number, if the fraction is less than 0.5.
Details of the ratio will be announced on the Stock Exchange News Service ("SENS") of the JSE in accordance
with the timetable below.
3. Circular and salient dates
A circular providing Shareholder with full information on the Scrip Distribution and the Cash Dividend
alternative, including a Form of Election to elect to receive the Cash Dividend alternative will be posted to
Shareholders on or about Friday, 14 August 2015. The salient dates of events thereafter are as follows:
EVENT 2015
Announcement released on SENS in respect of the ratio applicable to the Scrip
Distribution, based on the 30-day volume weighted average price ending on
Thursday, 20 August 2015, by 11:00 on Friday, 21 August
Announcement published in the press of the ratio applicable to the Scrip
Distribution, based on the 30-day volume weighted average price ending on
Thursday, 20 August 2015 on Monday, 24 August
Last day to trade in order to be eligible for the Scrip Distribution and the Cash
Dividend alternative Friday, 28 August
Ordinary shares trade "ex" the Scrip Distribution and the Cash Dividend
alternative on Monday, 31 August
Listing and trading of maximum possible number of ordinary shares on the
JSE in terms of the Scrip Distribution from the commencement of business on Monday, 31 August
Last day to elect to receive the Cash Dividend alternative instead of the Scrip
Distribution, Forms of Election to reach the Transfer Secretaries by 12:00 noon on Friday, 4 September
Record Date in respect of the Scrip Distribution and the Cash Dividend
alternative Friday, 4 September
Scrip Distribution certificates posted and Cash Dividend payments made,
CSDP/broker accounts credited/updated, as applicable, on Monday, 7 September
Announcement relating to the results of the Scrip Distribution and the Cash
Dividend alternative released on SENS on Monday, 7 September
Announcement relating to the results of the Scrip Distribution and the Cash
Dividend alternative published in the press on Tuesday, 8 September
JSE listing of ordinary shares in respect of the Scrip Distribution adjusted
to reflect the actual number of ordinary shares issued in terms of the Scrip
Distribution at the commencement of business on or about Wednesday, 9 September
All times provided are South African local times. The above dates and times are subject to change. Any
change will be announced on SENS.
Share certificates may not be dematerialised or rematerialised between Monday, 31 August 2015 and Friday,
4 September 2015, both days inclusive.
4. Tax implications
The Scrip Distribution and the Cash Dividend alternative are likely to have tax implications for both resident
and non-resident Shareholders. Shareholders are therefore encouraged to consult their professional tax
advisers, should they be in any doubt as to the appropriate action to take. In terms of the Income Tax
Act, No 58 of 1962 ("the Income Tax Act"), the Cash Dividend will, unless exempt, be subject to Dividend
Withholding Tax ("DWT"). South African resident Shareholders that are liable for DWT will be subject to DWT
at a rate of 15% of the Cash Dividend and this amount will be withheld from the Cash Dividend with the result
that they will receive a net amount of 25.50 cents per share. Non-resident Shareholders may be subject to
DWT at a rate of less than 15%, depending on their country of residence and the applicability of any Double
Tax Agreement between South Africa and their country of residence.
The Scrip Distribution is not subject to DWT in terms of the Income Tax Act, but the subsequent disposal
of ordinary shares obtained as a result of the Scrip Distribution is likely to have Income Tax or Capital Gains
Tax ("CGT") implications. Where any future disposals of ordinary shares obtained as a result of the Scrip
Distribution falls within the CGT regime, the base cost of such shares will be deemed to be zero in terms of
the Income Tax Act (or the value at which such ordinary shares will be included in the determination of the
weighted average base cost method will be zero).
Change in directorate
There has been no change to the Board of directors for the period ended 30 June 2015.
AJ Phillips BW Strong
Chairman Chief Executive Officer
12 August 2015
Condensed consolidated
statement of comprehensive
income
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Note Rm Rm Rm
Revenue 4 4,413.9 3,983.4 8,617.2
Cost of sales (2,756.5) (2,483.4) (5,332.3)
Gross margin 1,657.4 1,500.0 3,284.9
Administration and other operating expenditure (1,315.0) (1,230.0) (2,556.4)
Operating profit 5 342.4 270.0 728.5
Share of equity accounted investees' profit 5.0 3.1 15.6
Total profit from operations and equity
accounted investees 347.4 273.1 744.1
Net finance costs (57.9) (59.6) (121.0)
Finance costs 7 (62.6) (63.4) (130.7)
Investment income 4.7 3.8 9.7
Profit before tax 289.5 213.5 623.1
Tax charge (61.1) (64.0) (176.9)
Profit for the period from continuing operations 228.4 149.5 446.2
Other comprehensive income, net of taxation (5.8) 2.2 2.1
Items that will not be reclassified subsequently
to profit or loss
Actuarial gains on post-retirement benefit schemes – – (0.6)
Tax effect – – 0.2
Items that may be reclassified subsequently
to profit or loss
Effect of cash flow hedges (9.7) 2.6 0.2
Tax effect 2.7 (0.7) (0.1)
Exchange differences on translation of foreign operations 1.2 0.3 2.4
Total comprehensive income 222.6 151.7 448.3
Profit attributable to:
Equity holders of Mpact 221.7 149.5 423.0
Non-controlling interests in subsidiaries 6.7 – 23.2
Profit for the period 228.4 149.5 446.2
Comprehensive income attributable to:
Equity holders of Mpact 215.9 151.7 425.1
Non-controlling interests in subsidiaries 6.7 – 23.2
Total comprehensive income 222.6 151.7 448.3
Earnings per share (EPS) attributable
to equity holders of Mpact 8
Basic EPS (cents) 135.3 91.8 259.1
Diluted EPS (cents) 134.2 91.2 256.9
Condensed consolidated
statement of financial position
(Unaudited) (Unaudited) (Audited)
As at As at As at
30 June 30 June 31 December
2015 2014 2014
Note Rm Rm Rm
ASSETS
Non-current assets 3,965.8 3,408.3 3,632.8
Property, plant and equipment 2,761.7 2,205.2 2,422.9
Goodwill and other intangible assets 1,071.2 1,078.3 1,076.4
Other non-current financial assets and investment
in equity accounted investee's 110.7 111.6 115.0
Deferred tax assets 22.2 13.2 18.5
Current assets 3,328.2 3,075.8 3,430.0
Inventories 1,237.2 1,030.8 1,125.8
Trade and other receivables1 1,894.9 1,722.0 1,769.1
Cash and cash equivalents 196.1 323.0 535.1
Total assets 7,294.0 6,484.1 7,062.8
EQUITY AND LIABILITIES
Capital and reserves
Stated capital 9 2,397.3 2,326.0 2,344.1
Other reserves (0.3) 4.0 9.2
Retained earnings 842.6 515.0 738.0
Equity attributable to the equity holders of Mpact 3,239.6 2,845.0 3,091.3
Non-controlling interests in subsidiaries 101.8 98.0 114.8
Total equity 3,341.4 2,943.0 3,206.1
Non-current liabilities 1,585.9 1,448.3 1,256.0
Non-current borrowings 10 1,265.0 1,141.5 950.3
Retirement benefit obligations 58.5 55.4 57.4
Deferred tax liabilities 225.2 183.1 214.0
Other non-current liabilities 37.2 68.3 34.3
Current liabilities 2,366.7 2,092.8 2,600.7
Short-term borrowings and bank overdraft 10 658.3 587.6 887.7
Trade and other payables and provisions(1) 1,693.7 1,493.3 1,706.5
Current tax liabilities 14.7 11.9 6.5
Total equity and liabilities 7,294.0 6,484.1 7,062.8
(1) Included in these balances are derivative financial instruments which comprise of forward exchange contracts and an interest
rate swap, of which the inputs in determining fair values are classified as level 2 in terms of IFRS.
Condensed consolidated
statement of changes in equity
Post- Total
Share-based Cash flow retirement attributable to Non-
Stated payments hedge benefits Other Retained equity holders controlling Total
capital reserves reserves reserves reserves^ earnings of Mpact interests equity
Rm Rm Rm Rm Rm Rm Rm Rm Rm
Balance at 31 December 2013 (audited) 2,326.0 30.1 4.1 8.3 (61.8) 478.8 2,785.5 98.1 2,883.6
Dividends paid (94.9) (94.9) (94.9)
Total comprehensive income 1.9 0.3 149.5 151.7 151.7
Share scheme charges for the period 7.4 7.4 7.4
Dividends paid to non-controlling shareholders (0.1) (0.1)
Issue/exercise of shares options (16.2) 38.2 (15.9) 6.1 6.1
Purchase of shares(1) (10.8) (10.8) (10.8)
Reclassification 2.5 (2.5) –
Balance at 30 June 2014 (unaudited) 2,326.0 21.3 6.0 8.3 (31.6) 515.0 2,845.0 98.0 2,943.0
Dividends paid 18.1 (42.3) (24.2) (24.2)
Total comprehensive income (1.8) (0.4) 2.1 273.5 273.4 23.2 296.6
Purchase of shares(1) (38.6) (38.6) (38.6)
Share scheme charges for the period 8.0 8.0 8.0
Dividends paid to non-controlling shareholders (4.5) (4.5)
Issue/exercise of shares options 0.1 2.5 (3.4) (0.8) (0.8)
Put option held by non-controlling shareholder of subsidiary 33.1 33.1 33.1
Acquisition of subsidiary (1.9) (1.9)
Deferred settlement charge (4.6) (4.6) (4.6)
Reclassification 0.2 (0.2)
Balance at 31 December 2014 (audited) 2,344.1 29.4 4.2 7.9 (32.3) 738.0 3,091.3 114.8 3,206.1
Dividends paid(2) 53.2 (0.5) (107.8) (55.1) (55.1)
Total comprehensive income (7.0) 1.2 221.7 215.9 6.7 222.6
Share scheme charges for the period 9.4 9.4 9.4
Dividends paid to non-controlling shareholders (4.1) (4.1)
Issue/exercise of shares options (15.2) 49.7 (24.9) 9.6 9.6
Purchase of shares(1) (47.1) (47.1) (47.1)
Decrease of non-controlling interest(3) 15.6 15.6 (15.6)
Balance at 30 June 2015 (unaudited) 2,397.3 23.6 (2.8) 7.9 (29.0) 842.6 3,239.6 101.8 3,341.4
^ Other reserves consist of the option to equity holder reserves, revaluation reserves, foreign currency translation reserves
and treasury shares
(1) Treasury shares purchased represent the cost of shares in Mpact Limited purchased in the market and held by the
Mpact Incentive Share Trust to satisfy share awards under the Group's share scheme. As at 30 June 2015, there are
886,023 treasury shares on hand.
(2) Dividends declared amounted to R107.8 million of which R53.2 million related to a capitalisation issue, of which
R0.5 million were issued to the Mpact Incentive Share Trust.
(3) During the current period Mpact increased its shareholding in a subsidiary company by acquiring 9% of the
shareholding from the minority shareholders.
Condensed consolidated
statement of cash flows
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
Operating cash flows before movements in working capital 531.3 464.5 1,146.5
Net increase in working capital (223.4) (212.6) (156.6)
Cash generated from operations 307.9 251.9 989.9
Taxation paid (49.1) (72.6) (167.2)
Dividends received from equity accounted investees 6.1 2.5 5.4
Net cash inflows from operating activities 264.9 181.8 828.1
Investment in property, plant and equipment (512.1) (312.9) (700.7)
Acquisition of business – – (1.9)
Other investing activities 9.3 6.4 18.9
Net cash outflows from investing activities (502.8) (306.5) (683.7)
Purchase of treasury shares (47.1) (10.8) (49.4)
Net proceeds from borrowings 81.3 200.9 274.6
Finance costs paid (79.1) (59.7) (127.6)
Dividends paid to Mpact shareholders (55.1) (94.9) (119.1)
Other financing activities (4.1) (0.2) (4.6)
Net cash (outflows)/inflows from financing activities (104.1) 35.3 (26.1)
Net (decrease)/increase in cash and cash equivalents (342.0) (89.4) 118.3
Cash and cash equivalents at beginning of the period ^ 510.7 392.4 392.4
Cash and cash equivalents at end of the period ^ 168.7 303.0 510.7
^ Cash and cash equivalents net of overdrafts.
Notes
1. Basis of preparation
The condensed, consolidated interim financial statements have been prepared in accordance with International
Financial Reporting Standard (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued
by the Accounting Practices Committee and the Financial Pronouncements as issued by the Financial Reporting
Standards Council, and the requirements of the Companies Act of South Africa. The preparation of the Group's
consolidated results for the half year ended 30 June 2015 was supervised by the Chief Financial Officer,
BDV Clark CA(SA). These results are unaudited.
2. Accounting policies
The accounting policies and methods of computation used are consistent with those applied in the preparation of
the annual financial statements for the year ended 31 December 2014.
The following revised accounting standards, which had no significant impact on the Group, were adopted in the
current period:
– IAS 19: Employee benefits – Defined benefit plans
3. Seasonality
Seasonal effects in the Group's markets have historically resulted in higher revenue and operating profits for the
second half, when compared to the first half.
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
4. Group segment analysis
Revenue
Paper 3,279.9 2,923.0 6,294.0
Plastics 1,147.6 1,069.7 2,344.4
4,427.5 3,992.7 8,638.4
Less: Inter-segment revenue (13.6) (9.3) (21.2)
Total revenue 4,413.9 3,983.4 8,617.2
Operating profit
Paper 315.4 280.7 710.6
Plastics 87.3 43.9 132.0
Corporate (60.3) (54.6) (91.1)
Underlying segment total 342.4 270.0 751.5
Special items (note 6) – – (23.0)
Share of equity accounted investee's profit 5.0 3.1 15.6
Net finance cost (57.9) (59.6) (121.0)
Profit before tax 289.5 213.5 623.1
Assets
Paper 3,967.6 3,426.8 3,720.6
Plastics 1,721.1 1,381.2 1,500.6
Corporate(1) 1,605.3 1,676.1 1,841.6
Total assets 7,294.0 6,484.1 7,062.8
(1) Includes intangible and other non-operating assets.
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
5. Operating profit
Included in operating profit are:
Amortisation of intangible assets 5.6 5.5 11.0
Depreciation 182.6 184.5 385.5
6. Special items
Impairment of property, plant and equipment – – 9.3
Restructure costs – – 13.7
– – 23.0
7. Finance costs
Bank and other borrowings 68.6 60.9 130.0
Defined benefit arrangements 2.4 2.5 5.0
Interest capitalised to qualifying assets (8.4) – (4.3)
62.6 63.4 130.7
(Unaudited) (Unaudited) (Audited)
months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Cents Cents Cents
8. Earnings per share
Earnings per share (EPS)
Basic EPS 135.3 91.8 259.1
Diluted EPS 134.2 91.2 256.9
Underlying earnings per share(1)
Basic underlying EPS(2) 135.3 91.8 269.2
Diluted underlying EPS(2) 134.2 91.2 267.0
Headline earnings per share(3)
Basic headline EPS 134.4 91.5 262.7
Diluted headline EPS 133.3 90.8 260.5
(1) Underlying EPS excludes the impact of special items.
(2) Underlying earnings is arrived at by adjusting the profit attributable to equity holders of Mpact for special items, net of tax
(see note 6).
(3) The presentation of headline EPS is mandated under the JSE Listings Requirements. Headline earnings has been
calculated in accordance with Circular 2/2013, ‘Headline Earnings', as issued by the South African Institute of
Chartered Accountants.
The calculation of headline earnings, based on basic earnings is as follows:
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
Profit for the period attributable to equity
holders of Mpact 221.7 149.5 423.0
Profit on disposal of tangible and intangible assets (1.9) (0.8) (1.0)
Impairment of tangible assets – – 9.3
Related tax 0.5 0.2 (2.4)
Headline earnings for the period 220.3 148.9 428.9
Weighted Weighted Weighted
number number of number of
of shares shares shares
Weighted average number of ordinary shares in issue 163,876,224 162,804,567 163,268,866
Effect of dilutive potential ordinary shares 1,363,434 1,096,139 1,362,284
Diluted number of ordinary shares in issue(1) 165,239,658 163,900,706 164,631,150
(1) Diluted EPS is calculated by adjusting the weighted average number of ordinary shares in issue, on the assumption of
conversion of all potentially dilutive ordinary shares.
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
9. Stated capital
Authorised
217,500,000 shares of no par value – – –
Issued
165,331,235 shares of no par value 2,397.3 2,326.0 2,344.1
On 20 April 2015, 1,230,438 new ordinary shares
were issued to shareholders who elected to receive
capitalisation shares in terms of the capitalisation issue
in lieu of a cash dividend.
10. Borrowings
– Bank borrowings 900.0 1,124.3 900.0
– Other loans(1) 320.0 – –
– Finance lease liability 21.2 17.2 25.5
– Instalment loan facility 23.8 – 24.8
Long-term borrowings 1,265.0 1,141.5 950.3
Short-term borrowings and short-term portion
of long-term borrowings 564.2 541.5 795.8
Short-term shareholder loans 66.7 26.1 67.5
Bank overdraft 27.4 20.0 24.4
Total borrowings 1,923.3 1,729.1 1,838.0
(1) Other loans consist of IDC loan of R120.0 million, and KZN Growth Fund of R200.0 million. The Company's borrowing
powers are not restricted.
(Unaudited) (Unaudited) (Audited)
Six months Six months Year
ended ended ended
30 June 30 June 31 December
2015 2014 2014
Rm Rm Rm
11. Capital commitments
– Contracted capital commitments 548.0 476.6 503.8
– Approved capital commitments 591.8 711.9 848.4
Capital commitments 1,139.8 1,188.5 1,352.3
Commitments of R682.5 million will be spent in the next
12 months. The balance of R457.3 million will be spent
between one to five years.
These commitments will be met from existing cash resources
and borrowing facilities available to the Group.
12. Contingent liabilities
(a) Bank guarantees 79.6 7.4 7.8
In the current period R70.0 million of bank guarantees have
been issued for the purchase price of properties
to be acquired.
(b) A settlement agreement relating to the valuation of put
options previously held in a Group subsidiary provides
for a deferred payment contingent upon achievement of
certain EBITDA and ROCE levels for the years 2015 to
2018, subject to a maximum amount of R11.1 million.
13. Net asset value per share
Net asset value per share is defined as net assets
divided by the number of ordinary shares in issue
as at the period end.
Net asset value per share (cents) 2,021.0 1,799.2 1,953.7
14. Related parties
Transactions between the Company and its respective subsidiaries, which are related parties, have been eliminated
on consolidation.
The Group and its subsidiaries, in the ordinary course of business, enter into various sales, purchases and service
transactions with associates and others in which the Group has a material interest. These transactions are under
terms that are no less favourable than those arranged with third parties. These transactions in total are not
significant.
There have been no significant changes to the related parties in this interim reporting period.
15. Post-balance sheet events
The directors are not aware of any matters or circumstances arising subsequent to 30 June 2015 that require any
additional disclosure or adjustment to the interim financial statements.
Directors:
Independent non-executive
AJ Phillips (Chairman)
NP Dongwana, NB Langa-Royds
TDA Ross, AM Thompson
Executive
BW Strong (Chief Executive Officer)
BDV Clark (Chief Financial Officer)
Company secretary
MN Sepuru
Registered office
4th Floor, No 3 Melrose Boulevard
Melrose Arch, 2196
(Postnet Suite #179
Private Bag X1, Melrose Arch, 2076)
Transfer secretaries
Link Market Services
South Africa Proprietary Limited
13th Floor, Rennie House
19 Ameshoff Street
Braamfontein, 2001
(PO Box 4844, Johannesburg, 2000
South Africa)
Sponsor
Rand Merchant Bank
(a division of FirstRand Bank Limited)
1 Merchant Place
corner Fredman Drive and
Rivonia Road, Sandton, 2196
(PO Box 786273, Sandton, 2146)
Disclaimer
This document including, without limitation, those statements concerning the demand outlook, expansion projects
and its capital resources and expenditure, may be considered to be forward looking statements. By their nature,
forward-looking statements involve risk and uncertainty and although Mpact believes that the expectations reflected
in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to
have been correct. Accordingly, results could differ materially from those set out in the forward-looking statements
as a result of, among other factors, changes in economic and market conditions, success of business and operating
initiatives, changes in the regulatory environment and other government action and business and operational risk
management. While Mpact has taken reasonable care to ensure the accuracy of the information presented, Mpact
accepts no responsibility for any consequential, indirect, special or incidental damages, whether foreseeable or
unforeseeable, based on claims arising out of misrepresentation or negligence arising in connection with a forward-
looking statement. This document is not intended to contain any profit forecasts or profit estimates and has not been
reviewed or reported on by the auditors.
www.mpact.co.za
info@mpact.co.za
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