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Summarised Audited Consolidated Results For The Year Ended 31 December 2016
KAYDAV GROUP LIMITED
Incorporated in the Republic of South Africa
Registration number: 2006/038698/06
JSE share code: KDV ISIN: ZAE000108940
("KayDav" or "the company" or "the Group")
SUMMARISED AUDITED CONSOLIDATED RESULTS FOR THE YEAR ENDED 31 DECEMBER 2015
- Earnings per share 18.6 cents (up 16%)
- Headline earnings per share 18.7 cents (up 15%)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Audited year Audited year
ended ended
31 Dec 2015 31 Dec 2014
R R
Revenue 864 568 033 761 739 077
Cost of sales (621 857 231) (544 059 207)
Gross profit 242 710 802 217 679 870
Other income 858 473 147 248
Operating expenses (192 740 639) (174 400 706)
Operating profit 50 828 636 43 426 412
Investment income 130 895 102 689
Finance costs (5 871 522) (4 594 484)
Profit before taxation 45 088 009 38 934 617
Taxation (12 916 823) (11 118 641)
Profit for the year 32 171 186 27 815 976
Other comprehensive income - -
Total comprehensive income attributable to
equity holders of the parent 32 171 186 27 815 976
Reconciliation between earnings and headline earnings
Earnings 32 171 186 27 815 976
Loss on sale of plant and equipment 155 088 355 990
Taxation on loss on sale of plant and equipment (43 425) (99 677)
Impairment of plant and equipment - 158 290
Taxation on impairment of plant and equipment - (44 322)
Headline earnings 32 282 849 28 186 257
Weighted average number of shares in issue 172 751 585 172 751 585
Basic and diluted earnings per share (cents)* 18.6 16.1
Headline and diluted headline earnings per share (cents)* 18.7 16.3
*The company has no dilutionary instruments in issue.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited year Audited year
ended ended
31 Dec 2015 31 Dec 2014
R R
ASSETS
Non-current assets 92 775 977 91 259 337
Property, plant and equipment 66 115 538 64 492 411
Goodwill 26 361 344 26 361 344
Deferred taxation 299 095 405 582
Current assets 295 655 321 246 726 035
Inventories 151 515 557 113 181 728
Trade and other receivables 105 857 636 89 893 263
Cash and cash equivalents 36 983 740 42 922 052
Taxation 1 298 388 728 992
Total assets 388 431 298 337 985 372
EQUITY AND LIABILITIES
Capital and reserves 179 144 646 155 611 036
Share capital 173 173
Share premium 136 116 840 144 754 416
Accumulated profit 43 027 633 10 856 447
Non-current liabilities 32 141 294 38 892 969
Instalment sale liabilities 14 558 008 15 327 764
Interest-bearing liabilities 17 462 074 22 896 413
Deferred taxation 121 212 668 792
Current liabilities 177 145 358 143 481 367
Trade and other payables 118 950 994 93 241 500
Short-term portion of instalment sale liabilities 8 627 935 8 407 221
Short-term portion of interest-bearing liabilities 5 449 403 6 260 622
Bank overdraft 38 606 874 31 514 358
Taxation 2 018 794 972 386
Provisions 3 491 358 3 085 280
Total equity and liabilities 388 431 298 337 985 372
Shares in issue at year-end 172 751 585 172 751 585
Net asset value per share (cents) 103.7 90.1
Net tangible asset value per share (cents) 88.4 74.8
SUMMARISED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Audited year Audited year
ended ended
31 Dec 2015 31 Dec 2014
R R
Balance at the beginning of the year 155 611 036 140 751 333
Total comprehensive income for the year 32 171 186 27 815 976
Distribution to shareholders (8 637 576) (12 956 273)
Total equity 179 144 646 155 611 036
SUMMARISED CONSOLIDATED STATEMENT OF CASH FLOWS
Audited year Audited year
ended ended
31 Dec 2015 31 Dec 2014
R R
Net cash flows from operating activities 18 919 766 47 084 040
Net cash flows from investing activities (7 527 853) (8 250 925)
Net cash flows from financing activities (24 422 741) (13 301 062)
Net(decrease)/increase in cash and cash equivalents (13 030 828) 25 532 053
Net cash and cash equivalents at the beginning
of the year 11 407 694 (14 124 359)
Net cash and cash equivalents at the end of the year (1 623 134) 11 407 694
SEGMENTAL ANALYSIS
Audited year Audited year
ended ended
31 Dec 2015 31 Dec 2014
R R
Segmental revenue
Board distribution and adaptation 816 678 686 746 506 296
Packaging 49 606 551 15 232 781
Internal revenue (1 717 204) -
Total revenue 864 568 033 761 739 077
Internal revenue relates to sales from the Packaging
segment to the Board distribution and adaptation segment.
Segmental results
Board distribution and adaptation 45 552 997 41 596 095
Packaging 5 415 959 1 978 835
Other (140 320) (148 518)
Operating profit before interest 50 828 636 43 426 412
Operating assets
Board distribution and adaptation 332 808 281 300 114 312
Packaging 29 143 942 12 357 651
Other 812 810 1 431 886
Internal balances (2 292 562) (3 414 394)
Total operating assets 360 472 471 310 489 455
Operating liabilities
Board distribution and adaptation 157 015 369 132 667 666
Packaging 6 021 251 10 867 326
Other 46 402 596 40 612 559
Internal balances (2 292 562) (3 414 394)
Total operating liabilities 207 146 654 180 733 157
The Manufacturing operation was restructured, relocated and fully integrated into the
Group's Ottery board distribution business during the final quarter of 2014. As a result
the assets and liabilities, as well as the activities of the previously reported
Manufacturing segment, are no longer separately distinguishable from that of the board
distribution business and therefore not separately reported to the chief operating
decision-maker. The Board distribution and adaptation segment reported on in this
report therefore combines the previous Board distribution segment and the Manufacturing
segment. Segmental assets consist of property, plant and equipment, inventory, trade
and other receivables and operating cash and exclude taxation assets, investments and
intangible assets. Segmental liabilities consist of operating liabilities and exclude
taxation liabilities.
COMMENTARY
INTRODUCTION
KayDav comprises a group of businesses involved in the distribution of wood-based panels
as well as packaging and packaging machinery. Wood-based panels are manufactured through
the compression of wood waste into solid panels. These panels have a variety of
applications in the construction, furniture manufacturing and shopfitting industries.
Packaging consumables and machinery are those products and machines which cater for a
wide variety of packaging requirements in the industrial, agricultural and commercial
sectors.
FINANCIAL RESULTS
KayDav's board of directors ("the board") is pleased to report a satisfying set of
results for the 2015 financial year.
The Group grew revenue by 13% from R761.7 million to R864.6 million, with the Board
distribution and adaptation segment growing revenue by 9% and the Packaging segment
contributing its first full year of revenue of R49.6 million (2014: R15.2 million).
Gross profit increased by 11.5% to R242.7 million (2014: R217.7 million) after a drop
in the gross profit percentage of 0.5 of a percentage point, but with operating expenses
increasing by only 10.5%, KayDav had strong profit and earnings growth. Operating
profit grew by R7.4 million to R50.8 million (2014: R43.4 million) with Packaging
contributing R5.4 million, while headline earnings per share of 18.7 cents
(2014: 16.3 cents) and earnings per share of 18.6 cents (2014: 16.1 cents) grew by
15% and 16% respectively.
At 31 December 2015 the Group had a net tangible asset base of R152.8 million
(2014: R129.2 million) after a cash distribution to shareholders out of share premium
of R8.6 million (2014: R13.0 million), with a net debt equity ratio of 27% (2014: 27%)
and a current ratio of 1.7 (2014: 1.7). We believe that this provides a sound platform
for future growth.
PROSPECTS
The Packaging segment provides the most immediate opportunity for growth and here the
Group is focusing on expanding its Gauteng operation and on penetrating the market with
recently added product lines in both the Western Cape and Gauteng.
In KayDav's traditional board distribution business slow macro-economic growth continues
to affect the industry. The Group remains focused on increasing its market share
profitably by being customer-centric and sales-focused while maintaining and improving
working capital efficiency.
CHANGES TO CAPITAL STRUCTURE
There has been no change in KayDav's capital structure during the year ended
31 December 2015 aside from a distribution out of share premium to shareholders of
5.0 cents per share, amounting to R8.6 million, on 18 May 2015.
DISTRIBUTIONS TO SHAREHOLDERS
Notice is hereby given that the board of directors of KayDav has resolved to make a
capital reduction in lieu of a dividend out of share premium (a reduction of Contributed
Tax Capital as defined in the Income Tax Act, No. 58 of 1962) of 5.5 cents per share
(the "cash distribution").
SALIENT DATES
The salient dates in respect of the cash distribution are as follows:
Last day to trade to be eligible to receive the cash distribution Friday, 13 May 2016
Shares trade 'ex' the cash distribution Monday, 16 May 2016
Record date for the cash distribution Friday, 20 May 2016
Cash distribution paid to shareholders Monday, 23 May 2016
Share certificates may not be dematerialised or rematerialised between Monday,
16 May 2016 and Friday, 20 May 2016. The cash distribution will be transferred to
dematerialised shareholders' CSDP accounts/broker accounts and paid to certificated
shareholders' bank accounts on Monday, 23 May 2016.
ADDITIONAL INFORMATION
In terms of the JSE Listings Requirements in relation to cash distributions
the following information is disclosed:
1. The issued share capital of KayDav is 172 751 585 ordinary shares; and
2. KayDav's tax reference number is 9154477161.
Given that the cash distribution is by way of a reduction of Contributed Tax Capital,
the information relating to dividends tax is not applicable and has not been disclosed.
SUBSEQUENT EVENTS
No material changes have taken place in the affairs of the Group between the end of the
financial year and the date of this report, which require adjustment or disclosure.
BASIS OF PREPARATION
The summarised audited consolidated financial statements have been prepared in accordance
with International Financial Reporting Standards (IFRS) as issued by the International
Accounting Standards Board (IASB), the South African Institute of Chartered Accountants
Financial Reporting Guides as issued by the Accounting Practices Committee, Financial
reporting pronouncement as issued by the Financial Reporting Standards Council (FRSC),
the requirements of IAS 34 (Interim Financial Reporting) and the requirements of the
South African Companies Act and the JSE Listings Requirements.
The accounting policies applied in preparing these summarised audited consolidated
financial statements are consistent with those presented in the annual financial
statements for the year ended 31 December 2014.
The annual financial statements were prepared under the supervision of the CFO,
Martin Slier, CA(SA).
DIRECTORATE
Shane van Niekerk was appointed as independent non-executive director on 1 August 2015
to fill the vacancy left by the resignation of Jonathan Hertz, who resigned with effect
from 31 July 2015. As a result of these changes, Boitumelo Tlhabanelo was appointed as
chairperson of KayDav's Audit and risk committee and Shane van Niekerk as member thereof
and as chairperson of KayDav's Remuneration committee. Shareholders are referred to the
Group's SENS announcement of 29 July 2015 in respect of these changes for more
information.
AUDIT REPORT
The external auditor, Grant Thornton, has issued an opinion on the Group's consolidated
financial statements for the year ended 31 December 2015. The audit was conducted in
accordance with International Standards on Auditing. The auditor responsible for the
audit is K T Kuhn. An unmodified audit opinion has been issued on the consolidated
financial statements.
These summarised audited consolidated results for the year ended 31 December 2015 have
been extracted from the audited annual financial statements but are not themselves
audited. The audit report does not necessarily cover all the information included in
the announcement. Shareholders are therefore advised that in order to obtain a full
understanding of the nature of the auditor's engagement they should obtain a copy of
the auditor's report together with the accompanying financial information from the
company's registered office. The directors take full responsibility for the preparation
of these summarised audited consolidated results and confirm that the financial
information has been correctly extracted from the underlying audited results for the
year ended 31 December 2015.
NOTICE OF ANNUAL GENERAL MEETING
Shareholders are advised that the integrated annual report containing the annual
financial statements will be posted on or before 31 March 2016. KayDav's annual general
meeting will be held at 10:00 on Thursday, 19 May 2016 at the offices of Grant Thornton
Johannesburg Partnership, 52 Corlett Drive, Wanderers Office Park, Illovo, 2196, Gauteng.
The last day to trade in order to be eligible to participate in and vote at the annual
general meeting is Friday, 6 May 2016 and the record date for voting purposes is Friday,
13 May 2016.
APPRECIATION
The board extends its appreciation to our management and staff for their efforts
during this reporting period. We also thank our customers and suppliers for their
continued support.
On behalf of the board
I H Stern G F Davidson
Chairperson Chief Executive Officer
24 March 2016
CORPORATE INFORMATION
Incorporated in the Republic of South Africa
Registration number: 2006/038698/06
Share code: KDV
ISIN: ZAE000108940
Income tax reference number: 9154/477/16/1
Registered address: 105 Bamboesvlei Road, Ottery, 7800
Postal address: PO Box 272, Ottery, 7808
Telephone: 021 704 7060
Facsimile: 021 714 2082
Executive directors: G F Davidson (CEO), M Slier (CFO)
Independent non-executive directors: I H Stern (Chairperson), B Tlhabanelo, S van Niekerk
Company Secretary: CIS Company Secretaries Proprietary Limited
Auditor: Grant Thornton Johannesburg Partnership
Transfer Secretaries: Link Market Services South Africa Proprietary Limited
Sponsor: Java Capital
Website: www.kaydav.co.za
Java Capital
29 March 2016
Date: 29/03/2016 04:09:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
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indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
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