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Provisional Reviewed Condensed Group Financial Results for the year ended 29 February 2016
GOLD BRANDS INVESTMENTS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2015/168426/06)
JSE code: GBI
ISIN: ZAE000212791
("Gold Brands" or "the Company" or "the Group")
PROVISIONAL REVIEWED CONDENSED GROUP FINANCIAL RESULTS
FOR THE YEAR ENDED 29 FEBRUARY 2016
CONDENSED GROUP STATEMENT OF COMPREHENSIVE INCOME
Reviewed
February 2016
R
Revenue 235 502 971
Cost of sales (174 894 524)
Gross profit 60 608 447
Other income 1 837 985
Operating expenses (49 087 061)
Earnings before interest, taxation, depreciation and amortisation 13 359 371
Depreciation and amortisation (2 388 668)
Profit before interest and taxation 10 970 703
Investment revenue 2 309 314
Finance costs (928 106)
Profit before taxation 12 351 911
Taxation (3 398 031)
Profit for the year 8 953 880
Other comprehensive income -
Total comprehensive income for the year 8 953 880
Attributable to:
Equity holders of the company 8 953 880
Basic earnings per share (cents) 10.25
Headline earnings per share (cents) 10.25
Diluted earnings per share (cents) 10.25
Diluted headline earnings per share (cents) 10.25
CONDENSED GROUP STATEMENT OF FINANCIAL POSITION
Reviewed
February 2016
R
ASSETS
Non-current assets 24 053 742
Property, plant and equipment 12 172 550
Goodwill 5 931 416
Intangible assets 5 885 112
Deferred taxation 64 664
Current assets 67 614 486
Inventories 17 521 409
Other financial assets 17 679 717
Current tax receivable 1 882 765
Trade and other receivables 27 423 289
Cash and cash equivalents 3 107 306
Total assets 91 668 228
EQUITY AND LIABILITIES
Equity 53 830 880
Share capital 44 877 000
Retained income 8 953 880
Non-current liabilities 4 884 999
Instalment sale obligation 4 884 999
Current liabilities 32 952 349
Current tax payable 2 231 529
Instalment sale obligation 1 779 085
Operating lease liability 780 517
Trade and other payables 28 161 218
Total equity and liabilities 91 668 228
Number of ordinary shares in issue at year-end 110 000 000
Net asset value per share (cents) 48.94
Net tangible asset value per share (cents) 38.19
CONDENSED GROUP STATEMENT OF CHANGES IN EQUITY
Retained
Share capital income Total equity
R R R
Balance at 1 March 2015 - - -
Profit for the year - 8 953 880 8 953 880
Other comprehensive
income - - -
Total comprehensive
income for the year - 8 953 880 8 953 880
Issue of shares 44 877 000 - 44 877 000
Balance at 29 February
2016 44 877 000 8 953 880 53 830 880
CONDENSED GROUP STATEMENT OF CASH FLOWS
Reviewed
February
2016
R
Cash flows utilised in operating activities (10 021 811)
Cash flows utilised in investing activities (11 178 637)
Cash flows generated from financing activities 23 785 078
Net increase in cash and cash equivalents 2 584 630
Cash acquired through business combinations 522 676
Cash and cash equivalents at the end of the year 3 107 306
SEGMENTAL REPORTING
IFRS 8 requires an entity to report financial and descriptive information about its reportable segments,
which are operating segments or aggregations of operating segments that meet specific criteria.
Operating segments are components of an entity about which separate financial information is
available that is evaluated regularly by the chief operating decision maker.
Therefore, the Group determines and presents its operating segments based on the information that is
internally provided to the Chief Executive Officer, who is the chief operating decision maker.
Furthermore, a segment is a distinguishable component of the group that is engaged either in
providing related products or services (business segment), in providing products or services within a
particular economic environment (geographical segment), which is subject to risks and returns that are
different from those of the other segments.
The Group does not have different operating segments. The business is conducted in South Africa and
is managed at a central head office with no branches. The Group is managed as one operating unit.
All revenues from external customers originate in South Africa, or from operations in South Africa.
NOTES TO THE FINANCIAL INFORMATION
Reconciliation of headline earnings for the year
Reviewed
February 2016
R
Earnings attributable to ordinary shareholders 8 953 880
Adjusted for: -
Headline earnings attributable to ordinary shareholders 8 953 880
Weighted average shares in issue (number) 87 358 904
Weighted average diluted shares in issue (number) 87 358 904
Basic earnings per share (cents) 10.25
Diluted earnings per share (cents) 10.25
Headline earnings per share (cents) 10.25
Diluted headline earnings per share (cents) 10.25
OVERVIEW
The directors have pleasure in announcing financial results for February 2016. The past year has been
an exciting one, culminating with our listing on the JSE 12 February 2016. Our vision is to be the
leading Franchise Company in South Africa and International markets with unique and authentic
brands backed by our cost effective and reliable supply chain.
FRANCHISING
2016 has welcomed our Chesanyama brand into new consumer markets, with the opening of our first
store in a major mall – Menlyn Shopping centre in Pretoria. We have continued to see good growth in
our Chesanyama Brand reaching a milestone of 300 stores, with 41 signed up new applicants who we
are in the process of identifying sites for.
We acquired the legendary Blacksteer brand in March 2015 and with our re-engineering of the brand
we ensured that the "Legend "lives on. To date 19 new Black Steer stores have been opened.
A new addition to our portfolio is "Hot Chicks", we opened our first store in May 2016 with two more
planned in the near future.
1+1 Pizza currently has 15 stores operating. We believe that our superior product is well placed to
becoming one of the leaders in the pizza industry. Collectively Pitaland and Wild wings have 10
operating stores currently.
SUPPLY CHAIN
Through the growth of our brands we have established a central kitchen / production plant providing
consistency of product to our franchised outlets. Via our supply chain we are sourcing local
ingredients and products to ensure that affordability to the customer and profitability for the
Franchisees, utilising products that are of a superior quality.
BASIS OF PREPARATION
The condensed Group financial results for the year ended 29 February 2016 included in this
announcement have been prepared in accordance with the recognition and measurement criteria of
International Financial Reporting Standards ("IFRS"), and have been prepared in accordance with the
presentation and disclosure requirements of IAS 34 Interim Financial Reporting, the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee, and Financial Pronouncements as
issued by the Financial Reporting Standards Council, the Listings Requirements of the JSE Limited,
and the requirements of the South African Companies Act.
The condensed Group financial results are prepared in accordance with the going concern principle
under the historical cost basis as modified by the fair value accounting of certain assets and liabilities
where required or permitted by IFRS. These condensed group financial results are presented in the
South African Rand, which is the group's functional and presentation currency.
These condensed Group financial results incorporate the financial results of the company and its
subsidiaries. Results of subsidiaries are included from the effective date of acquisition. All significant
transactions and balances between group enterprises are eliminated on consolidation.
The preparation of the condensed Group financial results for the year ended 29 February 2016 was
supervised by the Financial Director, Terence Ballard. The directors take full responsibility for the
preparation of the condensed Group financial results for the year ended 29 February 2016.
Comparative figures have not been disclosed as the company was only incorporated during the current
financial year.
GOING CONCERN
The board of directors is of the opinion that, having regard to the current status and the future strategy
of the Group, the Group has sufficient resources to continue as a going concern.
SHARE CAPITAL
During the financial year, the Group had various issues of shares. Detailed below is a summary of the
issued share capital of GBIL.
Issued shares Share Capital
79 500 000 shares issued at R0.25 per share R19 875 000
5 500 000 shares issued at R0.00036 per share R2 000
25 000 000 shares issued at R 1 per share R 25 000 000
ACQUISITIONS
Related party acquisitions
On 1 March 2015, the Group acquired 100% of the voting shares of Franchising to Africa (Pty) Ltd,
Blacksteer Enterprises (Pty) Ltd and Goldbrands Food Services (Pty) Ltd, related parties to GBIL.
The acquisition has been accounted for using the acquisition method.
There were no other acquisitions during the financial year, other than those listed above.
The fair values of the identifiable assets and liabilities of the companies as at the date of acquisition
were:
Franchising to Blacksteer Goldbrand Food
Africa (Pty) Ltd Enterprises (Pty) Services (Pty) Ltd
Ltd R
Assets R R
Other financial assets 1 373 000 2 343 535 -
Property, plant and equipment 10 997 900 - -
Inventories 9 543 338 - -
Trademarks 4 310 112 1 575 000 -
Trade and other receivables 14 833 414 - -
Cash and cash equivalents 458 556 64 120 -
Liabilities
Other financial liabilities - (1 373 000) -
Trade and other payables (20 575 496) (801 151) -
Other current liabilities (2 827 833) (8 395) -
Instalment sale obligation (5 781 081) - -
Deferred tax (104 625) - -
Total identifiable assets 12 227 285 1 800 109 -
Goodwill arising on acquisition 3 328 965 1 699 891 902 562
Purchase consideration 15 556 250 3 500 000 902 562
transferred
CONTINGENCIES
The directors are not aware of any material contingent liability which existed at the reporting date and
up to the date of this report requiring disclosure.
FINANCIAL INSTRUMENTS RECOGNISED AT FAIR VALUE
The Group doesn't recognise any of its financial instruments at fair value. The carrying values of the
group's financial instruments however approximates their fair values.
SUBSEQUENT EVENTS
The directors are not aware of any matter or circumstance arising since the reporting date which
would have a material effect on the condensed group financial results.
REVIEW CONCLUSION
The auditors, Nexia SAB&T, have reviewed the provisional condensed group financial statements for
the year ended 29 February 2016, and have expressed an unmodified review conclusion.
The auditor's unmodified review report is available for inspection at the company's registered office.
DIVIDEND POLICY
No ordinary dividends were declared, and no ordinary dividend is proposed for the year.
PROSPECTS
The economy has seen a drastic decline in domestic consumer spend for individual consumers and in
an attempt to combat the slow- down in consumer spending we have had to absorb many of the costs
and be innovative in our menu ideas to ensure consumer affordability, without losing focus on product
quality.
We look forward to taking our well-loved authentic South African Chesanyama and Black Steer
brands to global markets. Our aim is to launch new and exciting concepts to expand our portfolio of
brands globally. We continue to enhance our infrastructure, improve our franchisee profitability and
margins offering quality products at reasonable prices to consumers.
CHANGES TO THE BOARD OF DIRECTORS
The following directors have been appointed during the period under review:
Executive directors:
Name Date of appointment
Efpraxia Nathanael ("Praxia") 18 May 2015
Terrence Craig Ballard 18 May 2015
Non-executive directors:
Name Date of appointment
Christos Kassianides 18 May 2015
Clifford David Raphiri 01 December 2015
Valentine Nichas 01 December 2015
Hlumelo Biko 15 January 2016
Clive Korona-Yashe Rugara 15 January 2016
By order of the Board
17 June 2016
Efpraxia Nathanael Terrence Ballard
Chief Executive Officer Financial Director
CORPORATE INFORMATION
Non-executive directors: Clifford David Raphiri; Christos Kassianides; Valentine Nichas;
Hlumelo Biko; Clive Korona-Yashe Rugara
Executive directors: Efpraxia Nathanael ("Praxia"); Terrence Craig Ballard
Registration number: 2015/168426/06
Registered address: 195 Witch-Hazel Avenue, Highveld Technopark, Centurion, 0046
Postal address: PO Box 290, Cornwall Hill, Irene, 0178
Company secretary: River Group
Telephone: (012)346 8540
Transfer secretaries: Trifecta Capital Investor Service (Pty) Limited
Designated Adviser: River Group
Date: 17/06/2016 11:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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