Wrap Text
Audited results for the year ended 29 February 2016
Raubex Group Limited
(Incorporated in the Republic of South Africa)
Registration number 2006/023666/06
Share Code: RBX
ISIN Code: ZAE000093183
("Raubex" or the "Group")
Audited results
for the year ended 29 February 2016
Rudolf Fourie, CEO of Raubex Group, said:
"The Group has delivered another solid set of results in a competitive construction sector and a
year during which the road construction industry was again impacted by a shortage in the supply
of bitumen.
A disciplined approach to securing a quality order book has resulted in a marked
improvement in the performance of the Road Construction division.
The Materials division continued to see a healthy demand for its products and services in both
its commercial quarrying operations and its mining and material handling operations with this
division contributing over half of the Group's operating profit.
We are very pleased with these results and our ability to produce consistently good results
year-on-year with strong cash flows to support healthy dividends for shareholders."
Salient features
Revenue up 9,4% to R7,93 billion (2015: R7,25 billion)
Operating profit up 14,2% to R710,6 million (2015: R622,2 million)
Group operating profit margin of 9,0% (2015: 8,6%)
HEPS up 12,1% to 234,4 cents per share (2015: 209,1 cents per share)
Cash flow from operations up 33,8% to R1,05 billion (2015: R785,1 million)
Capex spend of R549,5 million (2015: R510,6 million)
Order book of R8,27 billion (2015: R8,68 billion)
Final dividend of 42 cents per share declared
Commentary
Financial overview
Revenue increased 9,4% to R7,93 billion and operating profit increased by 14,2% to
R710,6 million from the corresponding prior year. These results were supported by an
improvement in the performance of the Road Construction division and favourable operating
conditions in the Materials division which contributed 56,3% of total operating profit.
The Infrastructure division results were stable, supported by solar energy projects gaining
momentum in the second half of the year.
Profit before tax increased 9,1% to R661,6 million (2015: R606,6 million) with the effective tax
rate stable at 29,1% compared to 29,4% in the prior year.
Earnings per share increased 11,0% to 236,9 cents with headline earnings per share increasing
12,1% to 234,4 cents.
Group operating profit margin increased to 9,0% (2015: 8,6%).
Cash generated from operations increased 33,8% to R1,05 billion (2015: R785,1 million) before
finance charges and taxation.
Net finance costs increased to R49,2 million (2015: R15,7 million) due mainly to an increase in
interest-bearing borrowings. Total non-cash finance costs amounted to R6,6 million for the year.
Trade and other receivables increased by 11,2% to R1,54 billion (2015: R1,38 billion). Payment
delays from the Road Development Agency in Zambia continued to be experienced with an
amount of R115,5 million outstanding at year-end included in accounts receivable.
Inventories increased by 6,6% to R564,1 million (2015: R529,0 million). The increase was mainly
due to the Group's property development projects through its subsidiaries Raudev and Raubex
Building with a value of R110,3 million included under inventories.
Borrowings remained flat at R1,09 billion (2015: R1,10 billion).
Capital expenditure on property, plant and equipment increased 7,6% to R549,5 million
(2015: R510,6 million). The effect of the weaker rand on imported plant and equipment contributed
towards the increase.
The Group's net cash inflow for the year was R29,0 million after a net cash outflow of R47,0 million
on acquisition of subsidiaries and treasury shares acquired to the value of R46,6 million.
Total cash and cash equivalents at the end of the year increased 3,5% to R969,7 million
(2015: R937,3 million).
Operational overview
Materials division
The Materials division, which includes the Raumix operations, comprises three main disciplines
including commercial quarries, contract crushing and materials handling and processing for the
mining industry.
The division delivered another strong performance for the year and continued to experience
favourable operating conditions. The commercial quarries were supported by a healthy demand for
aggregates and the acquisition of Belabela Quarries in Botswana. Despite weaker commodity prices,
conditions continued to favour the material handling and processing operations, which are mainly
focused on the diamond, gold and copper mining sectors. Contract crushing operations have been
stable and are operating in competitive conditions that are in line with the South African
construction sector.
Revenue for the division increased 18,9% to R2,33 billion (2015: R1,96 billion)
and operating profit increased by 23,5% to R399,8 million (2015: R323,6 million).
The divisional operating profit margins increased to 17,1% (2015: 16,5%).
The division incurred capital expenditure of R323,2 million during the year (2015:
R358,3 million).
The division has a secured order book of R1,76 billion (2015: R1,86 billion).
Construction division
Road surfacing and rehabilitation
This segment specialises in the manufacturing and laying of asphalt, chip and spray, surface
dressing, enrichments and slurry seals and includes the operations of Tosas, a company
specialising in the manufacture and distribution of value added bituminous products. In the
prior year, Tosas was reported as a segment on its own and their results have now been
incorporated in the Road surfacing and rehabilitation segment. The comparative figures for
the prior year have been restated.
This segment has a healthy order book and prospects for securing more work at both a National and
Provincial Government level are encouraging. Revenue growth slowed during the year due to
lower bitumen prices which are correlated to the international crude oil price and also a severe
bitumen supply shortage in South Africa due to unplanned refinery shut downs in the first half of
the year. The bitumen supply shortage was resolved in the second half of the year and
management continuously monitors supply side dynamics in order to execute timely contingency
plans.
Revenue for the division increased 3,1% to R3,05 billion (2015: R2,96 billion) with
operating profit decreasing by 15,2% to R172,7 million (2015: R203,7 million).
The divisional operating profit margin decreased to 5,7% (2015: 6,9%).
The division incurred capital expenditure of R128,4 million during the year (2015: R70,0 million),
with R57,3 million relating to expansion and modernisation of the Tosas operations and plant.
The division has a secured order book of R3,09 billion (2015: R2,60 billion).
Road construction and earthworks
This segment includes the road and civil infrastructure construction operations focused on the
key areas of new road construction and heavy road rehabilitation.
This segment has been working through a better quality order book during the year as a result
of selective tendering and order book discipline. Teams have focused on daily production monitoring
and the efficient execution of contracts. Execution on the Zambia Link 8000 work has been hindered
by a delay in payment from the Zambian Road Development Agency.
Revenue for the division decreased 4,3% to R1,40 billion (2015: R1,46 billion) with operating
profit increasing 86,7% to R103,0 million (2015: R55,2 million).
The divisional operating profit margins increased to 7,4% (2015: 3,8%).
The division incurred capital expenditure of R48,1 million during the year (2015: R44,6 million).
The division has a secured order book of R2,29 billion (2015: R3,20 billion) with R890 million
relating to the Link 8000 contracts in Zambia.
Raubex Infrastructure
The Infrastructure segment specialises in disciplines outside of the road construction sector,
including energy (with a specific focus on renewable energy), rail, telecommunications, pipeline
construction and housing infrastructure projects.
Stable results were reported by this segment. The first half of the year saw the completion of works
on some challenging mining infrastructure contracts and a delay in award of renewable energy work.
The execution of solar energy work gained momentum in the second half of the year. Progress has been
made in securing a pipeline of work opportunities in the affordable residential housing market.
Revenue for the division increased 32,7% to R1,14 billion (2015: R862,7 million) and operating profit
decreased 11,6% to R35,1 million (2015: R39,6 million).
The divisional operating profit margins decreased to 3,1% (2015: 4,6%).
The division incurred capital expenditure of R49,9 million (2015: R37,7 million).
The division has a secured order book of R1,12 billion (2015: R1,01 billion).
International
The Group's international operations ("the rest of Africa") have expanded and good results were
reported from both the Materials and Construction divisions. Operations are focused mainly in
Botswana, Mozambique, Namibia and Zambia.
In Zambia, good progress was made during the year on the Link 8000 road contracts and the
Zambian Kwacha strengthened significantly in the second half of the year from its lows in
September 2015. The foreign exchange risk on these contracts has been reduced through an
escalation recovery formula linked to the Zambian CPI index which was agreed with the client.
In Botswana, the acquisition of Belabela Quarries was bedded down well and provided the Group
with a base from which to expand and further develop its operating model in the country.
International revenue increased 87,8% to R1,20 billion (2015: R639,0 million) and operating profit
increased by 161,6% to R218,3 million (2015: R83,4 million).
Operating profit margins increased to 18,2% (2015: 13,1%).
The international order book stands at R2,13 billion (2015: R2,20 billion), and is included in
the Materials and Construction division's order book.
Prospects
The Group has a secured order book of R8,27 billion (2015: R8,68 billion) with 25,8% of the order
book representing contracts outside of South Africa in the rest of Africa. The Zambia Link 8000
contracts account for R890 million of the order book.
The Group's road construction operations have secured a good quality short-term order book and are
executing effectively with no problem contracts. The focus will now be on order book replacement to
secure the medium term. With SANRAL receiving above inflationary increases in its maintenance budget
and an increasing order book of provincial government work, prospects are encouraging.
Favourable operating conditions are expected to continue for the commercial quarry operations and
the Group will continue to look for acquisitions in the materials sector to expand its geographical
footprint. Post year-end, the Competition Tribunal approved the acquisition of the OMV Kimberley
quarry with conditions.
The material handling and processing operations are expected to remain stable given current
commodity price levels. A stable labour force and demand for commodities are key to the
prospects of these operations. Should the outlook for specific commodities change, there is
client and commodity diversification within the operations to mitigate risk.
Projects in the renewable energy sector are gaining momentum and the Infrastructure division is
well placed to benefit from the continued roll out of Eskom's Renewable Energy Independent Power
Producer Procurement Programme ("REIPPP").
Supported by encouraging prospects, a strong balance sheet and healthy cash position, the Group
is looking forward to another good year ahead as it enters its tenth year of operations since
listing on the JSE in March 2007.
Dividend declaration
The directors have declared a gross final cash dividend from income reserves of 42 cents per
share on 9 May 2016 for the year ended 29 February 2016. The salient dates for the payment of
the dividend are as follows:
Last day to trade cum dividend Friday, 27 May 2016
Commence trading ex dividend Monday, 30 May 2016
Record date Friday, 3 June 2016
Payment date Monday, 6 June 2016
No share certificates may be dematerialised or rematerialised between Monday, 30 May 2016 and
Friday, 3 June 2016, both dates inclusive.
In terms of Dividends Tax ("DT"), the following additional information is disclosed:
- The local DT rate is 15%;
- The number of ordinary shares in issue at the date of this declaration is 189 250 036;
- The dividend to utilise for determining the DT due is 42 cents per share;
- The DT amounts to 6,30 cents per share;
- The net local dividend amount is 35,70 cents per share for shareholders liable to pay
the DT; and
- Raubex Group Limited's income tax reference number is 9370/905/151.
In terms of the DT legislation, the DT amount due will be withheld and paid over to the South
African Revenue Service by a nominee company, stockbroker or Central Security Depository
Participant (collectively "Regulated Intermediary") on behalf of shareholders. All shareholders
should declare their status to their Regulated Intermediary, as they may qualify for a reduced DT
rate or exemption.
Group income statement
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Revenue 7 925 754 7 245 259
Cost of sales (6 800 882) (6 257 742)
Gross profit 1 124 872 987 517
Other income 27 966 12 113
Other gains/(losses) - net 12 695 9 984
Administrative expenses (454 970) (387 443)
Operating profit 710 563 622 171
Finance income 41 872 46 520
Finance costs (91 116) (62 259)
Share of profit of investments accounted for using the equity method 324 205
Profit before income tax 661 643 606 637
Income tax expense (192 240) (178 563)
Profit for the year 469 403 428 074
Profit for the year attributable to:
Owners of the parent 445 308 399 837
Non-controlling interest 24 095 28 237
Basic earnings per share (cents) 236,9 213,4
Diluted earnings per share (cents) 234,3 209,9
Group statement of comprehensive income
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Profit for the year 469 403 428 074
Other comprehensive income for the year, net of tax
Currency translation differences (2 069) 382
Actuarial gain/(loss) on post-employment benefit obligations 149 (137)
Total comprehensive income for the year 467 483 428 319
Comprehensive income for the year attributable to:
Owners of the parent 443 388 400 082
Non-controlling interest 24 095 28 237
Total comprehensive income for the year 467 483 428 319
Calculation of diluted earnings per share
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Profit attributable to owners of the parent entity 445 308 399 837
Weighted average number of ordinary shares in issue ('000) 187 961 187 330
Adjustments for:
Shares deemed issued for no consideration (share options) ('000) 2 085 3 202
Weighted average number of ordinary shares for diluted earnings
per share ('000) 190 046 190 532
Diluted earnings per share (cents) 234,3 209,9
Calculation of headline earnings per share
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Profit attributable to owners of the parent entity 445 308 399 837
Adjustments for:
Profit on sale of property, plant and equipment (6 527) (11 348)
Total tax effects of adjustments 1 827 3 177
Basic headline earnings 440 608 391 666
Weighted average number of shares ('000) 187 961 187 330
Headline earnings per share (cents) 234,4 209,1
Diluted headline earnings per share (cents) 231,8 205,6
Group statement of financial position
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Assets
Non-current assets
Property, plant and equipment 2 335 748 2 171 829
Intangible assets 829 283 795 098
Investment in associates and joint ventures 50 682 10 708
Deferred income tax assets 42 478 43 136
Non-current inventories 81 954 90 668
Non-current trade and other receivables 114 438 129 355
Total non-current assets 3 454 583 3 240 794
Current assets
Inventories 482 162 438 330
Construction contracts in progress and retentions 369 184 362 351
Trade and other receivables 1 423 371 1 253 668
Current income tax receivable 27 593 40 964
Cash and cash equivalents 969 736 937 275
Total current assets 3 272 046 3 032 588
Total assets 6 726 629 6 273 382
Equity
Share capital 1 892 1 873
Share premium 2 179 613 2 179 613
Treasury shares (46 599) -
Other reserves (1 148 951) (1 140 762)
Retained earnings 2 718 123 2 381 905
Equity attributable to owners of the parent 3 704 078 3 422 629
Non-controlling interest 128 764 110 788
Total equity 3 832 842 3 533 417
Liabilities
Non-current liabilities
Borrowings 682 027 672 320
Provisions for liabilities and charges 65 741 54 253
Deferred income tax liabilities 310 041 311 621
Other financial liabilities 59 385 77 262
Total non-current liabilities 1 117 194 1 115 456
Current liabilities
Trade and other payables 1 323 782 1 170 248
Borrowings 411 411 427 620
Current income tax liabilities 18 466 26 641
Other financial liabilities 22 934 -
Total current liabilities 1 776 593 1 624 509
Total liabilities 2 893 787 2 739 965
Total equity and liabilities 6 726 629 6 273 382
Group statement of cash flows
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Cash flows from operating activities
Cash generated from operations 1 050 461 785 053
Finance income 41 872 46 520
Finance costs (84 522) (57 900)
Income tax paid (190 449) (188 848)
Net cash generated from operating activities 817 362 584 825
Cash flows from investing activities
Purchases of property, plant and equipment (549 535) (510 599)
Proceeds from sale of property, plant and equipment 48 825 40 267
Acquisition of subsidiaries (47 049) (202 485)
Loans granted to associates and joint ventures (39 650) (10 500)
Net cash used in investing activities (587 409) (683 317)
Cash flows from financing activities
Proceeds from borrowings 502 667 752 827
Repayment of borrowings (509 725) (411 642)
Proceeds from shares issued 19 14
Dividends paid to owners of the parent (135 623) (131 131)
Dividends paid to non-controlling interests (6 281) (33 242)
Disposal of interest in a subsidiary 200 -
Acquisition of interest in a subsidiary (5 600) (12 294)
Acquisition of treasury shares (46 599) -
Net cash (used in)/generated from financing activities (200 942) 164 532
Net increase in cash and cash equivalents 29 011 66 040
Cash and cash equivalents at the beginning of the year 937 275 871 260
Effects of exchange rates on cash and cash equivalents 3 450 (25)
Cash and cash equivalents at the end of the year 969 736 937 275
Group statement of changes in equity
Share Share
capital premium
R'000 R'000
Balance at 1 March 2014 1 859 2 179 613
Shares issued in terms of equity-settled share option scheme 14 -
Share option reserve - -
Put option written on non-controlling interest - -
Non-controlling interest arising on business combination - -
Acquisition of non-controlling interest - -
Total comprehensive income for the year - -
Dividends paid - -
Balance at 28 February 2015 1 873 2 179 613
Shares issued in terms of equity-settled share option scheme 19 -
Share option reserve - -
Non-controlling interest arising on business combination - -
Disposal of interest to non-controlling interest - -
Acquisition of non-controlling interest - -
Acquisition of treasury shares during the year - -
Total comprehensive income for the year - -
Dividends paid - -
Balance at 29 February 2016 1 892 2 179 613
Treasury Other
shares reserves
R'000 R'000
Balance at 1 March 2014 - (1 104 240)
Shares issued in terms of equity-settled share option scheme - (16 242)
Share option reserve - 27 797
Put option written on non-controlling interest - (48 459)
Non-controlling interest arising on business combination - -
Acquisition of non-controlling interest - -
Total comprehensive income for the year - 382
Dividends paid - -
Balance at 28 February 2015 - (1 140 762)
Shares issued in terms of equity-settled share option scheme - (25 995)
Share option reserve - 19 875
Non-controlling interest arising on business combination - -
Disposal of interest to non-controlling interest - -
Acquisition of non-controlling interest - -
Acquisition of treasury shares during the year (46 599) -
Total comprehensive income for the year - (2 069)
Dividends paid - -
Balance at 29 February 2016 (46 599) (1 148 951)
Total
attributable
to owners of
Retained the parent
earnings company
R'000 R'000
Balance at 1 March 2014 2 109 193 3 186 425
Shares issued in terms of equity-settled share option scheme 16 242 14
Share option reserve - 27 797
Put option written on non-controlling interest - (48 459)
Non-controlling interest arising on business combination - -
Acquisition of non-controlling interest (12 099) (12 099)
Total comprehensive income for the year 399 700 400 082
Dividends paid (131 131) (131 131)
Balance at 28 February 2015 2 381 905 3 422 629
Shares issued in terms of equity-settled share option scheme 25 995 19
Share option reserve - 19 875
Non-controlling interest arising on business combination - -
Disposal of interest to non-controlling interest (54) (54)
Acquisition of non-controlling interest 443 443
Acquisition of treasury shares during the year - (46 599)
Total comprehensive income for the year 445 457 443 388
Dividends paid (135 623) (135 623)
Balance at 29 February 2016 2 718 123 3 704 078
Non-
controlling Total
interest equity
R'000 R'000
Balance at 1 March 2014 54 612 3 241 037
Shares issued in terms of equity-settled share option scheme - 14
Share option reserve - 27 797
Put option written on non-controlling interest - (48 459)
Non-controlling interest arising on business combination 61 376 61 376
Acquisition of non-controlling interest (195) (12 294)
Total comprehensive income for the year 28 237 428 319
Dividends paid (33 242) (164 373)
Balance at 28 February 2015 110 788 3 533 417
Shares issued in terms of equity-settled share option scheme - 19
Share option reserve - 19 875
Non-controlling interest arising on business combination 5 951 5 951
Disposal of interest to non-controlling interest 254 200
Acquisition of non-controlling interest (6 043) (5 600)
Acquisition of treasury shares during the year - (46 599)
Total comprehensive income for the year 24 095 467 483
Dividends paid (6 281) (141 904)
Balance at 29 February 2016 128 764 3 832 842
Group segmental analysis
Road surfacing Road construction
Materials and rehabilitation and earthworks
R'000 R'000 R'000
Operating segments
29 February 2016
Segment revenue 2 332 083 3 048 219 1 400 823
Operating profit 399 823 172 682 102 989
Margin 17,1% 5,7% 7,4%
28 February 2015
Segment revenue 1 961 342 2 957 304 1 463 953
Operating profit 323 640 203 713 55 169
Margin 16,5% 6,9% 3,8%
Infrastructure Consolidated
R'000 R'000
Operating segments
29 February 2016
Segment revenue 1 144 629 7 925 754
Operating profit 35 069 710 563
Margin 3,1% 9,0%
28 February 2015
Segment revenue 862 660 7 245 259
Operating profit 39 649 622 171
Margin 4,6% 8,6%
Local International Consolidated
R'000 R'000 R'000
Geographical information
29 February 2016
Segment revenue 6 725 552 1 200 202 7 925 754
Operating profit 492 253 218 310 710 563
Margin 7,3% 18,2% 9,0%
28 February 2015
Segment revenue 6 606 290 638 969 7 245 259
Operating profit 538 722 83 449 622 171
Margin 8,2% 13,1% 8,6%
Employee benefit expense
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Employee benefit expense in the income statement consists of:
Salaries, wages and contributions 1 911 428 1 648 079
Share options granted to employees 19 875 27 797
Total employee benefit expense 1 931 303 1 675 876
Capital expenditure and depreciation
Audited Audited
12 months 12 months
29 February 28 February
2016 2015
R'000 R'000
Capital expenditure for the year 549 535 510 599
Depreciation for the year 371 306 334 997
Amortisation of intangible assets for the year 671 280
Notes
Basis of preparation
The summary consolidated financial statements are prepared in accordance with the
requirements of the JSE Limited Listings Requirements for abridged reports, and the requirements
of the Companies Act applicable to summary financial statements. The Listings Requirements
require abridged reports to be prepared in accordance with the framework concepts and the
measurement and recognition requirements of International Financial Reporting Standards
("IFRS") and the SAICA Financial Reporting Guides as issued by the Accounting Practices
Committee and Financial Pronouncements as issued by the Financial Reporting Standards
Council and to also, as a minimum, contain the information required by IAS 34 Interim Financial
Reporting. The accounting policies applied in the preparation of the consolidated financial
statements from which the summary consolidated financial statements were derived are in terms
of International Financial Reporting Standards and are consistent with those accounting policies
applied in the preparation of the previous consolidated annual financial statements.
These summary consolidated financial statements for the year ended 29 February 2016 have
been prepared under the supervision of the Financial Director, Mr JF Gibson CA(SA) and audited
by PricewaterhouseCoopers Inc., who expressed an unmodified opinion thereon. The auditor also
expressed an unmodified opinion on the annual financial statements from which these summary
consolidated financial statements were derived. A copy of the auditor's report on the summary
consolidated financial statements and of the auditor's report on the annual consolidated financial
statements are available for inspection at the Company's registered office.
The auditor's report does not necessarily report on all of the information contained in this
announcement. Any reference to pro forma or future financial information included in this
announcement has not been reviewed or reported on by the auditors. Shareholders are advised that
in order to obtain a full understanding of the nature of the auditors' engagement they should
obtain a copy of that report together with the accompanying financial information from the
Company's registered office.
Treasury shares
The Company acquired 2 682 662 of its own shares through purchases on JSE Limited. The total
amount paid to acquire the shares was R46,6 million and has been deducted from shareholders'
equity. The related weighted average share price at the time of purchase was R17,37.
Analysis of movement in treasury shares
Number Value
of shares R'000
At 1 March 2015 - -
Acquisition of treasury shares by Raubex (Pty) Ltd 2 682 662 46 599
At 29 February 2016 2 682 662 46 599
Business combinations
Belabela Quarries (Pty) Ltd ("Belabela")
On 18 March 2015 the Group effectively acquired 74% of Belabela for a purchase price of
R43 million to be settled in cash. Belabela is a commercial quarry operating on the outskirts
of Gaborone in Botswana. The acquisition will give the Group a base from which it can expand and
further develop its operating model in Botswana. The revenue included in the consolidated income
statement since 1 March 2015 contributed by Belabela was R103,1 million with a net profit
contribution of R15,2 million over the same period.
Mokwena Surfacing (Pty) Ltd ("Mokwena")
On 31 July 2015 the Group acquired the asphalt manufacturing business including the asphalt plant
and related fixed assets from Mokwena for a purchase price of R22 million in cash. These operations
are located in Durbanville in the Western Cape province. The acquired operations contributed
revenues of R7,4 million, and a net loss of R1,9 million for the period from 31 July 2015 to
29 February 2016.
Phuhlisa Development Solutions (Pty) Ltd ("PDS")
On 1 March 2015 the Group effectively acquired 80% of PDS for a purchase price of R0,4 million in
cash. PDS is a professional consulting firm, providing engineering and project management services
to the property development sector. The revenue included in the consolidated income statement since
1 March 2015 contributed by PDS was R2,5 million with a net profit contribution of R nil.
Details of the net assets acquired, purchase consideration and goodwill are set out below:
Belabela Mokwena
R'000 R'000
Consideration
Cash 43 000 22 000
Less: Loans owed and settled as part of acquisition (4 709) -
Total consideration 38 291 22 000
Recognised amounts of identifiable assets and acquired liabilities assumed
Property, plant and equipment 11 089 18 000
Intangible asset - mining right 9 502 -
Deferred tax asset 875 -
Inventories 7 719 -
Trade receivables 6 587 -
Current income tax receivable 79 -
Cash and cash equivalents 13 653 -
Borrowings (556) -
Deferred tax liability (3 361) -
Trade and other payables (18 721) -
Rehabilitation provision (3 978) -
Total identifiable net assets 22 888 18 000
Non-controlling interest (5 951) -
Goodwill attributable to owners of the parent 21 354 4 000
Total 38 291 22 000
Purchased consideration settled in cash 38 291 22 000
Less: Cash and cash equivalents in the business combination acquired (13 653) -
Cash outflow on acquisition for cash flow statement 24 638 22 000
PDS Total
R'000 R'000
Consideration
Cash 418 65 418
Less: Loans owed and settled as part of acquisition - (4 709)
Total consideration 418 60 709
Recognised amounts of identifiable assets and acquired liabilities assumed
Property, plant and equipment 3 29 092
Intangible asset - mining right - 9 502
Deferred tax asset - 875
Inventories - 7 719
Trade receivables 508 7 095
Current income tax receivable - 79
Cash and cash equivalents 7 13 660
Borrowings - (556)
Deferred tax liability - (3 361)
Trade and other payables (100) (18 821)
Rehabilitation provision - (3 978)
Total identifiable net assets 418 41 306
Non-controlling interest - (5 951)
Goodwill attributable to owners of the parent - 25 354
Total 418 60 709
Purchased consideration settled in cash 418 60 709
Less: Cash and cash equivalents in the business combination acquired (7) (13 660)
Cash outflow on acquisition for cash flow statement 411 47 049
Reclassification of comparative figures
In the prior year consolidated financial statements for the year ended 28 February 2015 the results
of Tosas were disclosed as a separate segment in the segmental analysis. This was done in order
to report the results of Tosas separately until such time as the acquired business was bedded
down within the Group and returned to profitability. In order to more fairly present the segments
and in line with the disclosure of information reported to the chief operating decision maker in
terms of IFRS, the results of Tosas have been disclosed as part of the Road surfacing and
rehabilitation segment. This has resulted in the restatement of the prior year figures.
Road
Road surfacing construction
Materials and rehabilitation and earthworks
Segment report as previously disclosed R'000 R'000 R'000
Reportable segments
28 February 2015
Segment revenue 1 961 342 2 568 538 1 463 953
Operating profit 323 640 192 462 55 169
Margin 16,5% 7,5% 3,8%
Infrastructure Tosas Consolidated
Segment report as previously disclosed R'000 R'000 R'000
Reportable segments
28 February 2015
Segment revenue 862 660 388 766 7 245 259
Operating profit 39 649 11 251 622 171
Margin 4,6% 2,9% 8,6%
Events after the reporting period
Business combinations
OMV Kimberley (Pty) Ltd and OMV Kimberley Mining (Pty) Ltd ("OMV Kimberley")
The small merger of Raumix Aggregates (Pty) Ltd and OMV Kimberley, originally prohibited by the
Competition Commission, was subsequently approved by the Competition Tribunal subject to
certain conditions on 9 March 2016. On receipt of the Competition Tribunal's order on
9 March 2016, the Group acquired 100% of OMV Kimberley for R37,5 million cash. OMV Kimberley is a
commercial quarry operating in the Northern Cape province supplying aggregates to the
construction industry.
The conditions imposed relate to controls relating to the pricing of aggregated crushed road stone
and the non-discrimination of competitors in the road contracting sector. A further enterprise
development condition was agreed which prohibits the Group from tendering for a resealing contract
in the Kimberley area other than through a HDI joint venture in which historically disadvantaged
persons hold in aggregate no less than sixty percent of the shares or other similar interest of
the HDI joint venture.
Contingent liabilities
On 29 April 2011, shareholders were advised that the Group had become aware of certain
irregularities in terms of the provisions of the Competition Act, No 89 of 1998. The Group filed a
Fast Track application to the Competition Commission in accordance with the Commission's
Invitation to Firms in the Construction Industry to Engage in Settlement of Contraventions of the
Act by the required deadline date of 15 April 2011.
Raubex signed a consent agreement with the Commission on 21 June 2013 in which the Company admitted
that it had engaged in collusive conduct during 2006 and 2007 in respect of eight road construction
contracts tendered on for the South African National Roads Agency SOC Limited ("SANRAL").
Raubex paid an administrative penalty of R58,8 million on 20 August 2013.
On 19 April 2016, the Group received a summons to inform that SANRAL had instituted legal action
against Raubex to claim relief for damages suffered as a consequence of certain of the
contraventions referred to above. No provision for damages has been made in these annual
financial statements.
No further material events after the reporting period occurred up to the date
of preparation of these Group financial statements.
On behalf of the Board
JE Raubenheimer
Chairman
RJ Fourie
Chief Executive Officer
JF Gibson
Financial Director
9 May
2016
Company information
Directors
JE Raubenheimer#
RJ Fourie
JF Gibson
F Kenney#
LA Maxwell*
BH Kent*
NF Msiza*
# Non-executive
* Independent non-executive
Company secretary
Mrs HE Ernst
Registered office
Building No 1
The Highgrove Office Park
50 Tegel Avenue
Centurion
0169
South Africa
Transfer secretaries
Computershare Investor Services (Pty) Ltd
70 Marshall Street
Johannesburg
2001
South Africa
Auditors
PricewaterhouseCoopers Inc.
Sponsor
Investec Bank Limited
Contacts
Raubex Group
Rudolf Fourie
+27 (0) 51 406 2000
James Gibson
+27 (0) 12 648 9400
Instinctif Partners
+27 (0) 11 447 3030
Frederic Cornet
+27 (0) 83 307 8286
Pietman Roos
+27 (0) 72 360 5575
www.raubex.com
Date: 09/05/2016 07:15:00 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
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
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,
information disseminated through SENS.
Sharenet Sites 
