Wrap Text
Audited summarised consolidated results
HOLDSPORT LIMITED
("Holdsport" or "the company" or "the group")
Registration number: 2006/022562/06
Share code: HSP
ISIN: ZAE000157046
AUDITED SUMMARISED CONSOLIDATED RESULTS
FOR THE YEAR ENDED 29 FEBRUARY 2016
Sales up 11.8% to R1 727.4 million
Operating profit increased by 15.8% to R308.9 million
Core headline earnings per share up 21.3% to 548.7 cents
Final gross dividend increased by 21.2% to 200.0 cents per share
GROUP OVERVIEW
The Holdsport Limited group comprises the retail divisions Sportsmans Warehouse and
Outdoor Warehouse and Performance Brands, a wholesale business that includes the
First Ascent and Capestorm brands.
Total sales increased by 11.8% to R1 727.4 million and retail sales increased by 12.4%
to R1 678.8 million.
Operating profit increased by 15.8% to R308.9 million. Core headline earnings amounted
to 548.7 cents per share, a 21.3% increase on the previous year.
During the current year the aggregate foreign exchange adjustment was a profit of
R8.4 million compared to an aggregate profit of R1.4 million during the prior year.
Core headline earnings excluding the effect of foreign exchange adjustments increased
by 18.8% to 534.5 cents per share.
TRADING DIVISIONS
External sales for the various trading divisions were as follows:
Increase in
Number of Sales sales
stores R'm %
Sportsmans Warehouse 37 1 278.6 12.8
Outdoor Warehouse 23 400.2 10.9
Retail sales 60 1 678.8 12.4
Performance Brands - 48.6 (4.1)
Total sales 60 1 727.4 11.8
Like-for-like retail sales grew by 9.4% while the retail divisions experienced price
inflation of approximately 8.1% for the year. The time weighted trading area increased
by 6.1% relative to the prior year.
The Sportsmans Warehouse division now trades out of 37 stores. The division opened
two stores and closed one store during the year. Like-for-like sales increased by 10.7%.
The Outdoor Warehouse division comprises 23 stores. The division opened two stores
and relocated two stores during the year. Like-for-like sales increased by 5.3%.
Performance Brands' external sales were 4.1% lower than last year but sales to the
group's retail divisions increased by 46.8%.
CASH FLOW
The group's net debt increased to R36.6 million at the end of the year from
R0.2 million at the end of the previous year.
The aggregate investment in working capital increased by 25.8% due to the increase in
trading space and the effect of the weaker exchange rate on the cost of imported stock,
coupled with slightly earlier imports than the previous year. As a result cash
generated from operations decreased by 2.6% compared to the previous year.
The group incurred R73.5 million in maintaining and expanding its operations in the year.
During the year the group purchased and awarded R15.1 million of Holdsport shares in
terms of and subject to the rules of the 2011 Holdsport Forfeitable Share Plan (FSP).
The forfeitable share plan is expensed over the vesting period and the expense of
R11.6 million for the current year is R1.9 million higher than the prior year.
REFINANCING OF DEBT
The group's term debt of R130 million is repayable on 31 August 2016 and accordingly
has been disclosed as a current liability on 29 February 2016. Holdsport intends to
refinance this debt on similar terms.
SHARE BUY-BACKS
The group purchased 987 412 Holdsport shares during the year for R51.8 million in
accordance with the general authority granted by special resolution of the company's
shareholders passed at the company's annual general meetings held on 13 August 2014
and 12 August 2015 and in compliance with the relevant provisions of the JSE Listings
Requirements and the Companies Act (71 of 2008).
Holdsport holds 2.96% of its issued shares in treasury at 29 February 2016.
PROSPECTS
The group signed lease agreements for a further two new stores to be opened in the
next financial year and will relocate one store.
FINAL DIVIDEND ANNOUNCEMENT
The directors declared a final gross dividend of 200.0 cents per share in line with its
dividend policy to have dividends covered approximately 1.5 to 2 times by the core
headline earnings for the year. The dividend is payable on Monday, 13 June 2016 to
ordinary shareholders recorded in the books of the company at the close of business
on Friday, 10 June 2016.
The last day to trade ("cum" the dividend) in order to participate in the dividend
will be Friday, 3 June 2016. The Holdsport Limited ordinary shares will commence
trading "ex" the dividend from the commencement of business on Monday, 6 June 2016
and the record date, as indicated, will be Friday, 10 June 2016.
Ordinary shareholders should take note that share certificates may not be dematerialised
or rematerialised during the period Monday, 6 June 2016 to Friday, 10 June 2016,
both dates inclusive.
In terms of the withholding tax on dividends which became effective on 1 April 2012,
the following additional information is disclosed:
- the dividend has been declared out of total reserves;
- the South African tax dividend rate is 15%;
- the net local dividend amount is 170.0 cents per ordinary share for shareholders
liable to pay dividend tax, and 200.0 cents per ordinary share for shareholders
exempt from the dividend tax;
- the issued share capital of Holdsport at the date of declaration is 43 150 220
ordinary shares; and
- Holdsport's tax reference number is 9618595152.
Certificated ordinary shareholders are reminded that all entitlements to dividends with
a value less than R5.00 per certificated shareholder will be aggregated and the proceeds
donated to a registered charity of the directors' choice, in terms of the memorandum of
incorporation of the company.
Signed on behalf of the board
SA MULLER KG HODGSON
Chairman CEO
Cape Town
3 May 2016
SUMMARISED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
29 Feb 2016 28 Feb 2015
Audited Audited
R'000 R'000
ASSETS
Non-current assets
Property, plant and equipment 145 429 121 287
Goodwill and other intangibles 594 410 607 373
Total non-current assets 739 839 728 660
Current assets
Inventories 459 191 365 396
Trade and other receivables 23 994 25 619
Cash and cash equivalents 93 363 129 846
Taxation - 618
Derivative instruments 1 726 387
Total current assets 578 274 521 866
Total assets 1 318 113 1 250 526
EQUITY AND LIABILITIES
Capital and reserves
Share capital 229 312 229 312
Share-based payment reserve (21 726) (18 278)
Treasury shares (63 895) (12 084)
Retained earnings 832 912 735 755
Equity attributable to owners of the company 976 603 934 705
Non-current liabilities
Loan - 130 000
Deferred taxation 28 070 35 674
Straight-lining lease liability 36 496 28 918
Total non-current liabilities 64 566 194 592
Current liabilities
Trade and other payables 143 808 121 229
Loan 130 000 -
Taxation 3 136 -
Total current liabilities 276 944 121 229
Total liabilities 341 510 315 821
Total equity and liabilities 1 318 113 1 250 526
SUMMARISED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Year ended Year ended
29 Feb 2016 28 Feb 2015
Audited Audited
R'000 R'000
Sales 1 727 436 1 544 844
Cost of sales (899 421) (809 883)
Gross profit 828 015 734 961
Other income 6 294 15 719
Trading expenses (525 384) (483 936)
Operating profit 308 925 266 744
Finance income 6 591 5 380
Finance cost (11 388) (10 285)
Profit before taxation 304 128 261 839
Taxation (85 352) (73 944)
Profit and total comprehensive income for the year
attributable to equity holders of the company 218 776 187 895
SUMMARISED CONSOLIDATED CASH FLOW STATEMENTS
Year ended Year ended
29 Feb 2016 28 Feb 2015
Audited Audited
R'000 R'000
Cash flows from operating activities
Cash generated from operations 316 971 325 594
Finance income 6 591 5 380
Finance costs (11 388) (10 285)
Dividends paid (121 619) (141 684)
Taxation paid (89 202) (80 837)
Net cash inflows from operating activities 101 353 98 168
Cash flows from investing activities
Additions to property, plant and equipment (73 500) (47 102)
Proceeds on sale of property, plant and equipment 2 544 43 306
Net cash outflows from investing activities (70 956) (3 796)
Cash flows from financing activities
Treasury shares acquired (51 811) (12 084)
Share-based payment award (15 069) (10 019)
Net cash outflows from financing activities (66 880) (22 103)
Net (decrease)/increase in cash and cash equivalents (36 483) 72 269
Cash and cash equivalents at the beginning of the year 129 846 57 577
Cash and cash equivalents at the end of the year 93 363 129 846
SUMMARISED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
Share-
based
Share payment Treasury Retained Total
capital reserve shares earnings equity
Audited Audited Audited Audited Audited
R'000 R'000 R'000 R'000 R'000
Balance at 1 March 2014 229 312 (17 926) - 689 544 900 930
Share-based payment award - (10 019) - - (10 019)
Share-based payment expense - 9 667 - - 9 667
Treasury shares acquired - - (12 084) - (12 084)
Dividends paid - - - (141 684) (141 684)
Total comprehensive income
for the year - - - 187 895 187 895
Balance at 28 February 2015 229 312 (18 278) (12 084) 735 755 934 705
Balance at 1 March 2015 229 312 (18 278) (12 084) 735 755 934 705
Share-based payment award - (15 069) - - (15 069)
Share-based payment expense - 11 621 - - 11 621
Treasury shares acquired - - (51 811) - (51 811)
Dividends paid - - - (121 619) (121 619)
Total comprehensive income
for the year - - - 218 776 218 776
Balance at 29 February 2016 229 312 (21 726) (63 895) 832 912 976 603
SUMMARISED CONSOLIDATED SEGMENTAL ANALYSIS
Sportsmans Outdoor Performance
Warehouse Warehouse Brands Corporate Group
R'000 R'000 R'000 R'000 R'000
Year ended 29 February 2016
Total sales 1 278 569 400 210 145 400 - 1 824 179
Less inter-segment sales - - (96 743) - (96 743)
External sales 1 278 569 400 210 48 657 - 1 727 436
External interest received - - 306 6 285 6 591
External interest paid - - (6) (11 382) (11 388)
Depreciation and amortisation (31 411) (10 273) (4 061) (14 625) (60 370)
Profit/(loss) before taxation 281 406 58 227 28 481 (63 986) 304 128
Capital expenditure 42 219 21 600 7 315 2 366 73 500
Segment assets 393 761 143 820 134 420 646 112 1 318 113
Segment liabilities 111 705 26 955 10 386 192 464 341 510
Year ended 28 February 2015
Total sales 1 133 594 360 590 116 537 - 1 610 721
Less inter-segment sales - - (65 877) - (65 877)
External sales 1 133 594 360 590 50 660 - 1 544 844
External interest received - - 187 5 193 5 380
External interest paid - - (23) (10 262) (10 285)
Depreciation and amortisation (25 702) (7 669) (3 850) (14 598) (51 819)
Profit/(loss) before taxation 234 089 55 454 21 762 (49 466) 261 839
Capital expenditure 34 411 9 596 739 2 356 47 102
Segment assets 328 096 114 743 109 220 698 467 1 250 526
Segment liabilities 85 600 24 180 5 602 200 439 315 821
NOTES TO THE SUMMARY FINANCIAL STATEMENTS
1. KPMG Inc., the group's independent auditor, has audited the consolidated financial
statements for the year to 29 February 2016 and has expressed an unmodified opinion
on the consolidated financial statements. The summary financial statements have been
audited and an unmodified opinion has been expressed on the summary financial
statements. The summary consolidated financial statements presented in this
announcement have been summarised from the audited consolidated financial statements.
Their audit reports are available for inspection at the company's registered office.
The summary consolidated financial statements are prepared in accordance with the
requirements of the JSE Limited Listings Requirements for preliminary reports,
and the requirements of the Companies Act applicable to summary financial statements.
The Listings Requirements require preliminary 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 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 audited summarised consolidated results have been prepared under the
supervision of the group's Chief Financial Officer, JP Loubser (CA(SA)).
2. These financial statements incorporate the financial statements of the company, all
its subsidiaries and all entities over which it has control.
Year ended Year ended
29 Feb 2016 28 Feb 2015
Audited Audited
R'000 R'000
3. Trading expenses
Depreciation on property, plant and equipment 47 407 38 856
Amortisation of intangibles 12 963 12 963
Occupancy cost 151 624 132 638
Straight-lining of leases 7 578 4 328
Staff costs 201 103 183 795
Foreign exchange gains (11 315) (559)
Other operating costs 116 024 111 915
525 384 483 936
4. Cash generated from operations
Operating profit 308 925 266 744
Adjustments for:
Depreciation 47 407 38 856
Amortisation of intangibles 12 963 12 963
Profit on sale of property, plant and equipment (593) (7 054)
Fair value gain on derivative instruments (1 339) (471)
Forfeitable share plan expense 11 621 9 667
Straight-lining of leases 7 578 4 328
Changes in working capital:
Decrease/(increase) in trade and other receivables 1 625 (837)
Increase in inventories (93 795) (10 960)
Increase in trade and other payables 22 579 12 358
Cash generated from operations 316 971 325 594
5. Earnings per share and net asset value per share
Earnings per ordinary share (cents)
- Basic 514.9 436.5
- Headline 513.9 423.4
- Core headline 548.7 452.3
- Core headline before foreign exchange effect 534.5 450.0
Ordinary shares in issue ('000) 43 150 43 150
Weighted average ordinary shares in issue ('000) 42 488 43 044
Net asset value per ordinary share (cents) 2 332.4 2 180.9
Net tangible asset value per ordinary share (cents) 1 038.8 895.4
Reconciliation to core headline earnings
The group uses core headline earnings as a consistent measure of performance for
management purposes. Core headline earnings exclude exceptional once-off costs,
the amortisation of trademarks and the lease straight-lining expense and is
presented below:
Year ended Year ended
29 Feb 2016 28 Feb 2015
Audited Audited
R'000 R'000
Basic earnings 218 776 187 895
Adjusted for (net of taxation):
Profit on sale of assets (427) (5 636)
Headline earnings 218 349 182 259
Adjusted for (net of taxation):
Amortisation of intangibles 9 333 9 333
Straight-lining of leases 5 456 3 117
Core headline earnings 233 138 194 709
Adjusted for (net of taxation):
Foreign exchange gains (8 147) (402)
Foreign exchange adjustments in cost of sales 2 124 (599)
Core headline earnings before foreign exchange effect 227 115 193 708
6. Dividend per share
Dividend declared per share (cents)
- Interim 120.0 85.0
- Final 200.0 165.0
Normal dividend 320.0 250.0
- Special - 99.0
Total dividend 320.0 349.0
Normal dividend cover (by core headline earnings) 1.7 1.8
Registered office: The Mill House, 1 Canterbury Street, Cape Town, 8001
Executive directors: KG Hodgson, B Moritz, JP Loubser
Non-executive directors: SA Muller (Chairman), B Hopkins, P Matlakala,
KR Moloko, KA Hedderwick
Company secretary: R Thomas
Transfer secretaries: Computershare Investor Services (Proprietary) Limited
Ground Floor, 70 Marshall Street, Johannesburg, 2001
3 May 2016
Sponsor: UBS South Africa (Proprietary) Limited
Date: 03/05/2016 02:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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