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Summarised Provisional Audited Financial Results For The Year Ended 30 June 2016
TRELLIDOR HOLDINGS LIMITED
(Registration number 1970/015401/06)
20 Aberdare Drive, Phoenix Industrial Park, Durban
(PO Box 20173, Durban North, 4016)
Share code: TRL
ISIN: ZAE000209342
("Trellidor", "the company" or "the group")
TRELLIDOR HOLDINGS LIMITED
SUMMARISED PROVISIONAL AUDITED FINANCIAL RESULTS
FOR THE YEAR ENDED 30 JUNE 2016
up 19% Profit after tax
Up 11,9% Earnings per share
up 10,8% Headline earnings per share
Up 25 cents per share Total dividend for 2016
SUMMARISED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Audited Audited
30 June 30 June
2016 2015
Note R R
Assets
Non-current assets
Property, plant and equipment 42 553 391 41 488 834
Goodwill 2 388 498 2 388 498
Intangible assets 1 629 879 675 894
Other financial assets 450 000 455 150
Deferred tax assets 3 707 122 2 702 024
50 728 890 47 710 400
Current assets
Inventories 30 796 398 21 369 847
Trade and other receivables 44 434 785 40 719 224
Other financial assets 1 546 327 1 080 672
Cash and cash equivalents 89 387 613 15 424 293
166 165 123 78 594 036
Total assets 216 894 013 126 304 436
Equity and liabilities
Equity
Stated capital 3 45 759 072 92
Reserves 581 777 (201 798)
Retained income 103 500 885 69 762 595
Equity attributable to owners of the company 149 841 734 69 560 889
Non-controlling interests (845 811) (1 294 401)
Total equity 148 995 923 68 266 488
Liabilities
Non-current liabilities
Other financial liabilities 23 366 519 18 776 249
Provisions – 5 644 237
23 366 519 24 420 486
Current liabilities
Trade and other payables 37 515 819 27 708 089
Other financial liabilities 2 978 150 3 676 557
Current tax payables 3 563 324 2 008 094
Provisions 474 278 224 722
44 531 571 33 617 462
Total liabilities 67 898 090 58 037 948
Total equity and liabilities 216 894 013 126 304 436
SUMMARISED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
Audited Audited
30 June 30 June
2016 2015
Note R R
Revenue 313 442 272 293 775 739
Cost of sales (156 187 883) (144 916 961)
Gross profit 157 254 389 148 858 778
Other income 6 391 171 2 863 787
Operating expenses (88 227 231) (85 336 767)
Operating profit before interest 75 418 329 66 385 798
Investment revenue 2 748 580 320 414
Finance costs (2 291 358) (3 099 419)
Profit before tax 75 875 551 63 606 793
Taxation (21 684 512) (18 097 072)
Profit for the year 54 191 039 45 509 721
Other comprehensive income:
Items that will be reclassified to profit or loss
Exchange differences on translating foreign operations (245 789) 81 235
Reclassification of hedging reserves to profit and loss 992 496 992 496
Income tax related to items that may be reclassified – –
Total items that may be reclassified to profit or loss 746 707 1 073 731
Other comprehensive income for the year net of taxation 746 707 1 073 731
Total comprehensive income for the year 54 937 746 46 583 452
Profit attributable to:
Owners of the company 53 705 581 45 419 116
Non-controlling interests 485 458 90 605
54 191 039 45 509 721
Total comprehensive income attributable to:
Owners of the company 54 489 156 46 480 661
Non-controlling interests 448 590 102 791
54 937 746 46 583 452
Earnings per share for the year attributable to the
owners of the company during the period
Basic and diluted earnings per share (cents) 4 50,8 45,4
SUMMARISED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Total attributable
to equity holders
Stated Total Accumulated of the group/ Non-controlling
capital reserves earnings company interests Total
R R R R R R
Balance at 1 July 2014 92 (1 263 343) 67 843 479 66 580 228 (1 397 192) 65 183 036
Total comprehensive income for the year – 1 061 545 45 419 116 46 480 661 102 791 46 583 452
Dividends – – (43 500 000) (43 500 000) – (43 500 000)
Balance at 1 July 2015 92 (201 798) 69 762 595 69 560 889 (1 294 401) 68 266 488
Total comprehensive income for the year – 783 575 53 705 581 54 489 156 448 590 54 937 746
Issue of shares 45 758 980 – – 45 758 980 – 45 758 980
Dividends – – (19 967 291) (19 967 291) – (19 967 291)
Balance at 30 June 2016 45 759 072 581 777 103 500 885 149 841 734 (845 811) 148 995 923
SUMMARISED CONSOLIDATED STATEMENT OF CASH FLOWS
Audited Audited
30 June 30 June
2016 2015
R R
Cash flows from operating activities
Cash receipts from customers 309 591 086 299 278 974
Cash paid to suppliers and employees (237 177 945) (220 888 434)
Cash generated from operations 72 413 141 78 390 540
Interest income 2 748 580 320 414
Finance costs (2 291 358) (3 099 419)
Tax paid (21 134 381) (21 455 059)
Net cash from operating activities 51 735 982 54 156 476
Cash flows used in investing activities
Purchase of property, plant and equipment (7 245 822) (3 218 573
Proceeds from sale of property, plant and equipment 807 301 30 494
Purchase of intangible assets (1 062 958) (16 063)
Net advances of other financial assets (762 798) (440 518)
Net cash used in investing activities (8 264 277) (3 644 660)
Cash flows from/(used in) financing activities
Proceeds on share issue 45 758 980
Net proceeds from/(repayment of) other financial liabilities) 4 835 062 (2 835 389)
Dividends paid (19 967 291) (43 500 000)
Net cash from/(used in) financing activities 30 626 751 (46 335 389)
Total cash movement for the year 74 098 456 4 176 427
Cash at the beginning of the year 15 424 293 11 191 778
Effect of exchange rate movement on cash balances (135 136) 56 088
Cash and cash equivalents at the end of the period 89 387 613 15 424 293
NOTES TO THE SUMMARISED CONSOLIDATED FINANCIAL RESULTS
1.Basis of preparation
The provisional audited summarised consolidated financial results for the year ended
30 June 2016 has been prepared and presented in accordance with the framework concepts
and the measurement and recognition requirements of International Financial Reporting
Standards ("IFRS"), the SAICA Financial Reporting Guides as issued by the Accounting Practices
Committee, the Listings Requirements of the JSE Limited, contains the information as required
by IAS 34 – Interim Financial Reporting and the Companies Act No 71 of 2008, under the
supervision of the Chief Financial Officer, Mr CG Cunningham CA (SA). The accounting policies
applied and methods of computation used in preparation of the summarised consolidated
financial information are consistent with those applied in the financial statements for the year
ended 30 June 2015.
The consolidated annual financial statements for the year have been audited by Mazars
and their accompanying unmodified audit report is available for inspection at the company's
registered office. The summarised consolidated financial results have been extracted from
audited consolidated annual financial statements but is itself not audited. The directors take
full responsibility for the preparation of the summarised report and that the financial information
has been correctly extracted from the underlying consolidated annual financial statements. The
consolidated annual financial statements were approved by the board on 12 September 2016.
Information included the heading "Prospects" and any reference to future financial information
included in the audited summarised consolidated financial results have not been audited or
reviewed. 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 their report with the
accompanying financial results from the company's registered office. Full details of the group's
business combinations after year end, additions and disposals of property, plant and equipment
as well as commitments and contingent liabilities will be included in the audited consolidated
annual financial statements that are available to be reviewed at the company's Registered Offices.
2.Segmental information
Operating segments are components of entities from which revenue may be earned and
expenses may be incurred, whose operating results are regularly reviewed by the entity's chief
operating decision maker to make decisions about resource allocations and for which discrete
financial information is available.
The group operates as a single operating segment, the manufacturing of barrier security, which
the chief executive officer assesses for resource allocation.
3.Capital and reserves
Issues of shares
During the year the company subdivided each issued ordinary share into 544 shares. On
28 October 2015, the company listed all of its issued ordinary shares on the JSE main board. In
conjunction with the listing, the company undertook a private placement by way of an offer to
invited investors to acquire and/or subscribe for private placement shares in the company. The
company issued 8 333 334 new ordinary shares through the private placement.
4. Earnings per share
Audited Audited
Year ended Year ended
30 June 30 June
2016 2015
R R
Profit attributable to ordinary shareholders 53,705,581 45,419,116
Adjusted for:
(Profit)/loss on disposal of property, plant
and equipment (541 609) 23 819
Gross amount (666 495) 33 082
Tax effect 124 886 (9 263)
Headline earnings 53 163 972 45 442 935
Number Number
Number of shares issued 108 340 118 183 836
Weighted average number of ordinary shares
in issue during the period 105 630 646 100 006 784
Diluted weighted average number of shares 105 630 646 100 006 784
Basic and diluted earnings per share (cents) 50,8 45,4
Headline and diluted earnings per share (cents) 50,3 45,4
5. Events after reporting date
On 8 July 2016 the group concluded the acquisition of an effective 92,5% interest in Taylor
Blinds and Shutters and NMC Decorative Mouldings through its subsidiary Trellidor
Innovations Proprietary Limited. The acquisition of the businesses provides the Trellidor
group with strong brands, management team and distribution network for the development
of the home improvements market, distinct from the Trellidor business. The IFRS adjusted
purchase consideration of R158 million (initial consideration R131 million, deferred discounted
consideration R27 million) includes goodwill of R52 million.
COMMENTARY
Introduction
Trellidor is the market leading manufacturer of custom made barrier security products,
distributed via a dedicated and skilled franchise network throughout South Africa.
Franchisees in Africa, the UK and Australia support, design and install the products internationally.
Operations overview
Trellidor is pleased to present its maiden results for the year ended 30 June 2016, post
listing the company on the Johannesburg Stock Exchange on 28 October 2015.
Profit after tax growth of 19%, in difficult trading conditions particularly in the second
half of the year, was driven by: revenue growth of 6,6%, maintenance of gross margin
at 50,1% and tight overhead control. In this respect operating expenses reduced
from 29,0% of revenue (June 2015) to 28,1%, notwithstanding one-off listing costs of
R1,7 million. Revenue growth from Africa at 15% for the year, was underpinned by solid
performance from our Ghanaian subsidiary which achieved 63% growth in revenue in
rand terms. Foreign exchange gains of R2,3 million (June 2015: R0,3 million), sale of
scrap of R1,2 million, profit on sale of property, plant & equipment of R0,7 million and
freight and insurance recoveries of R1 million were recognised in other income during
the period.
In June 2016, Trellidor launched a new in-house developed barrier security product, and
sales commenced in July 2016. New franchisees in Nigeria and the DRC have been
appointed and training and launch of these new franchises will take place in the first half
of FY17.
Cash generated from operating activities of R51,7 million was in line with expectation
and equated to 95% of profit after tax. Working capital investment increased due to
higher inventory levels, predominantly as a result of: the impact of the rand devaluation
on imported materials, a change of purchase strategy for certain components to benefit
from lower prices, the holding of materials for newly introduced products, and an increase
of stockholding in Ghana due to growth in the region.
Trellidor has low levels of gearing, at 30 June 2016, with interest bearing debt of
R26,3 million and cash and cash equivalents of R89,4 million, on hand.
Trellidor's earnings per share and headline earnings per share growth of 11,9% and
10,8%, respectively, for the year ended June 2016 was diluted by the issue of 8 333 334
new ordinary shares to partially finance acquisition opportunities.
Dividend
The Trellidor board of directors is pleased to announce a final gross dividend of
15,8 cents per share in respect of the year ended 30 June 2016, which brings the total
interim and final dividend declared for the year to 25,0 cents per share. Trellidor's future
dividend policy will reflect capital requirements to finance growth.
Acquisition of the Taylor Group
Aligned with Trellidor's growth strategy, the company concluded an acquisition of an
effective 92,5% interest in Taylor Blinds and Shutters and NMC Decorative Mouldings
("the Taylor Group") after year end. Taylor Blinds and Shutters specialises in designing,
manufacturing, marketing, distributing and servicing shutters and blinds in the South
African market. NMC Decorative Mouldings distributes imported decorative mouldings.
The acquisition of the Taylor Group provides strong brands, quality management and
an established distribution network for the development of the home improvements
market, distinct from the Trellidor security business. The initial tranche of the purchase
consideration for 100% of the equity of the Taylor Group was R131 million, financed by
cash of R51 million, which was raised by the issue of new shares on listing, bank debt of
R70 million and a R10 million investment by the MD of the Taylor Group (7,5% interest).
Deferred consideration of up to a maximum of R30 million is payable if profit after tax
(and before the cost of debt) of R33 million is achieved by the Taylor Group for the twelve
months ended 30 April 2017. The deferred consideration will be payable, at the option
of the sellers, by a combination of cash and/or new Trellidor shares issued at a price of
R6 a share.
Prospects
Tough trading conditions are expected to continue, however Trellidor is well positioned
to optimise the opportunities the market place has to provide, through its strong brand,
well established distribution network and basket of high quality products.
Growth will also be enhanced through the introduction of Trellidor's new product which
was successfully launched to the network in July 2016 and from newly appointed
territories in Africa including two new franchises in Nigeria.
The acquisition of the Taylor Group will establish a materially higher earnings base for the
future. No earnings from the Taylor Group have been included in the results for the year
ended 30 June 2016.
T M Dennison
Chief Executive Officer
13 September 2016
CASH DIVIDEND DECLARATION
Notice is hereby given that the directors have declared a final gross dividend of
15,8 cents per share for the year ended 30 June 2016.
The dividend has been declared from income reserves. A dividend withholding tax
of 15% will be applicable to shareholders who are not exempt. The net dividend is
13,43 cents per share for shareholders who are not exempt from dividends tax.
The issued share capital at the declaration date is 108 340 118 shares.
The income tax number of the company is 9419378840.
The salient dates for the dividend will be as follows:
Last day of trade to receive a dividend Tueday, 27 September 2016
Shares commence trading "ex" dividend Wednesday, 28 September 2016
Record date Friday, 30 September 2016
Payment date Monday, 3 October 2016
Share certificates may not be dematerialised or rematerialised between Wednesday,
28 September 2016 and Friday, 30 September 2016, both days inclusive.
CORPORATE INFORMATION Auditors and
Trellidor Holdings Limited Independent Reporting Accountants
("Trellidor", "the company" or "the group") Mazars
(Registration number:1970/015401/06) Mazars House
197 Peter Mokaba Road
Share code: TRL Morningside
Durban, 4001
ISIN: ZAE000209342 (PO Box 70584, Overport, 4067)
Corporate sponsor
Directors PSG Capital (Pty) Ltd
MC Olivier (Chairman)*# (Registration Number 2006/015817/07)
TM Dennison (Chief Executive Officer) 1st Floor, Ou Kollege
CG Cunningham (Chief Financial Officer) 35 Kerk Street
JB Winship*(#) Stellenbosch, 7600
RB Patmore*(#) (PO Box 7403, Stellenbosch, 7599); and
(*) Non-executive 1st Floor, Building 8
(#)Independent Inanda Greens Business Park
54 Wierda Road West
Company Secretary Wierda Valley
P Nel Sandton, 2196
(BComm FCIS) (PO Box 650957, Benmore, 2010)
71 Cotswold Drive
Westville, 3629 Transfer Secretaries
Computershare Investor Services (Pty) Ltd
(Registration Number 2004/003647/07)
Registered office Ground Floor, 70 Marshall Street)
20 Aberdare Drive Johannesburg, 2001
Phoenix Industrial Park (PO Box 61051, Marshalltown, 2107)
Durban, 4001
(PO Box 20173, Durban North, 4016)
Date of Incorporation: 23 November 1970
Place of Incorporation: South Africa
Date: 13/09/2016 01:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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