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Interim Results for the Six Months Ended 30 September 2016
AFRICAN MEDIA ENTERTAINMENT LIMITED
Incorporated in the Republic of South Africa
Registration number 1926/008797/06
JSE code: AME ISIN: ZAE000055802
("AME", "the company" or "the group")
INTERIM RESULTS
for the six months ended 30 September 2016
CONSOLIDATED CONDENSED STATEMENTS OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
six months to six months to year ended
30 September 30 September 31 March
% 2016 2015 2016
change R'000 R'000 R'000
Revenue (3) 119 421 123 032 238 303
Cost of sales (4) (32 573) (33 975) (57 104)
Gross profit 86 848 89 057 181 199
Operating expenses (62 970) (64 092) (116 766)
Operating profit (4) 23 878 24 965 64 433
Investment income 2 000 1 500 3 000
Finance income 3 848 3 039 6 342
Finance cost - (1) (4)
Profits attributable to associates 148 137 627
Net profit before taxation 1 29 874 29 640 74 398
Taxation (8 034) (8 041) (20 775)
SA normal taxation (9 190) (9 126) (20 206)
Deferred taxation 1 156 1 085 (569)
Total comprehensive income
for the period 1 21 840 21 599 53 623
Total comprehensive income attributable to:
Non-controlling interest holders 3 407 2 139 5 573
Equity holders of the parent (5,3) 18 433 19 460 48 050
Earnings per share (cents) (4) 229,8 239,2 591,2
Headline earnings per share (cents) (5) 226,7 239,2 587,6
Dividends per share (cents) 100 100 350
Weighted average number
of shares in issue ('000) 8 022 8 137 8 127
Headline earnings reconciliation
Profit attributable to equity holders 18 433 19 460 48 050
Profit on disposal of investment/fixed assets (249) - (408)
Tax on disposal of assets - - 114
Headline earnings 18 184 19 460 47 756
CONSOLIDATED CONDENSED STATEMENTS OF FINANCIAL POSITION
Unaudited Unaudited Audited
30 September 30 September 31 March
2016 2015 2016
R'000 R'000 R'000
ASSETS
Non-current assets 141 386 140 670 139 043
Property, plant and equipment 74 206 73 899 73 996
Goodwill 39 426 39 426 39 426
Investments 14 781 13 873 13 803
Deferred taxation 12 973 13 472 11 818
Current assets 153 331 160 855 160 747
Trade receivables 40 419 65 251 41 303
Other receivables 3 972 6 650 4 654
Tax paid in advance 677 2 444 738
Cash and cash equivalents 108 263 86 510 114 052
Total assets 294 717 301 525 299 790
EQUITY AND LIABILITIES
Total equity 209 338 198 961 218 615
Current liabilities 85 379 102 564 81 175
Trade payables 14 796 32 406 13 681
Other payables 68 136 68 298 65 037
Dividend payable 1 592 1 399 1 472
Taxation 855 461 985
Total equity and liabilities 294 717 301 525 299 790
CONSOLIDATED CONDENSED STATEMENTS OF CHANGES IN EQUITY
Unaudited Unaudited Audited
six months to six months to year ended
30 September 30 September 31 March
2016 2015 2016
R'000 R'000 R'000
Issued capital
Balance at beginning of period 8 120 8 159 8 159
Shares repurchased and cancelled (155) (39) (39)
Balance at end of period 7 965 8 120 8 120
Share premium
Balance at beginning of period 9 097 12 839 12 839
Shares repurchased and cancelled (9 097) (3 769) (3 742)
Balance at end of period - 9 070 9 097
Retained profit
Balance at beginning of period 199 342 179 760 179 760
Total comprehensive income for the period 18 433 19 460 48 050
Dividend (21 865) (20 334) (28 468)
Balance at end of period 195 910 178 886 199 342
Non-controlling interests
Balance at beginning of period 2 056 746 746
Share of total comprehensive income
for the period 3 407 2 139 5 573
Share of dividend - - (4 263)
Balance at end of period 5 463 2 885 2 056
Total capital and reserves 209 338 198 961 218 615
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
Unaudited Unaudited Audited
six months to six months to year ended
30 September 30 September 31 March
2016 2015 2016
R'000 R'000 R'000
Cash generated by operating activities 27 200 27 379 72 533
Net interest received 3 848 3 038 6 338
Taxation paid (9 259) (12 658) (21 508)
Decrease in working capital 5 780 2 149 3 098
Cash flows from operating activities 27 569 19 908 60 461
Cash flows from investing activities (2 361) (18 730) (15 637)
Cash flows from financing activities* (30 997) (20 181) (36 285)
Net (decrease)/increase in cash
and cash equivalents (5 789) (19 003) 8 539
Cash and cash equivalents at beginning of period 114 052 105 513 105 513
Cash and cash equivalents at end of period 108 263 86 510 114 052
*Dividends paid and shares repurchased.
SEGMENT REPORTING
Unaudited Unaudited Audited
six months to six months to year ended
30 September 30 September 31 March
2016 2015 2016
R'000 R'000 R'000
Revenue
Radio broadcasting 100 102 90 290 194 171
Radio services 19 083 32 742 43 766
Corporate 236 - 366
Total 119 421 123 032 238 303
Profitability
Radio broadcasting 27 938 24 363 58 915
Radio services (1 308) 2 469 8 237
Corporate (2 752) (1 867) (2 719)
Total operating profit 23 878 24 965 64 433
Unallocated/eliminated corporate net
expense and intercompany consolidation 148 137 627
Investment income 2 000 1 500 3 000
Interest received 3 848 3 039 6 342
Interest paid - (1) (4)
Taxation (8 035) (8 041) (20 775)
Total comprehensive income for the period 21 839 21 599 53 623
Assets
Radio broadcasting 66 020 77 972 65 938
Radio services 35 114 61 984 37 303
Corporate 85 320 75 059 82 497
Total 186 454 215 015 185 738
Liabilities
Radio broadcasting 53 727 50 457 53 109
Radio services 22 795 46 803 21 955
Corporate 8 857 5 304 6 111
Total 85 379 102 564 81 175
Capital expenditure
Radio broadcasting 2 620 11 202 13 640
Radio services 141 130 277
Corporate 769 4 830 5 701
Total 3 530 16 162 19 618
Depreciation
Radio broadcasting 2 784 1 833 4 424
Radio services 333 426 765
Corporate 158 156 312
Total 3 275 2 415 5 501
CHAIRMAN'S REVIEW
Trading conditions for the period under review were tough. Our operations experienced a decrease
in revenue of 3% to R119,4 million (2015: R123 million). Comprehensive income increased by 1%
to R21,8 million (2015: R21,6 million).
The comprehensive income attributable to equity holders of the parent amounted to R18,4 million
(2015: R19,5 million) with earnings per share of 229,8 cents (2015: 239,2 cents). Headline earnings
per share was 226,7 cents (2015: 239,2 cents).
After paying tax of R9,3 million (2015: R12,7 million), the group generated R27,6 million
(2015: R19,9 million) in cash from its operating activities during the period. The group invested
an additional R758 000 (2015: R13,5 million) in the development of the new home of the Central
Media Group in Bloemfontein and spent R2,8 million (2015: R2,7 million) on capital expenditure.
The group paid R11 million (2015: R3,8) to repurchase 155 144 (2015: 39 200) shares. During
the period, the group paid out dividends of R20,2 million (2015: R20,2 million) to the equity
holders of the company. The group ended the period with cash resources of R108,3 million
(2015: R86,5 million).
OPERATIONS
Low business confidence remains a key challenge across all sectors, resulting in demanding trading
conditions. Innovation and tight cost control remain imperative.
Agreement has been reached with SAMPRA in regard to Needletime.
Algoa FM's profitability improved during the first half of the financial year on the back of increased
national marketing spend around the local election and in the banking sector. Both national and
direct advertising revenues delivered results above expectation. There has been significant growth
in all revenue from Algoa FM's digital platforms and non-traditional revenue due to local demand
for the station's outside broadcast unit and activation squad. The excellent performance of the radio
station was underpinned by effective cost control. Algoa FM listenership, as released in the new
BRC RAM Diary, has shown 17% growth from the SAARF RAMS diary.
Central Media Group felt the pinch of the drought. The figures at half-year reflect the very
tough trading conditions. A modest growth in revenue and very tight cost controls meant that the
group has delivered on profit expectation over this period. Redstar Agency secured significant
new business, and the Second MiWay National Sevens tournament attracted more than double
the entries of last year, resulting in very good bottom line growth off a low base. Digital Platforms
made significant inroads into the Agri sector in the provision of web services, and the addition of
an App service resulted in new blue-chip clients such as SAB. Mahareng Publishing launched a new
community freesheet (Courant Voice) aimed at readers in Thaba Nchu and Botshabelo, and this has
added impetus to this business in otherwise competitive markets. OFM continues to experience
volatility in advertising demand and trading conditions for all the business units remain difficult.
RadioHeads performed significantly better compared to the same period last year.
Many campaigns previously postponed have materialised in the current financial year, giving
renewed impetus to the business. Management is confident of a stronger performance for the
rest of the year.
Sales revenue at United Stations was down on the previous year, due to a different mix of radio
station clients. Three established radio stations in major markets were replaced with five newly
launched stations in secondary markets, covering Northern Johannesburg, KZN, Mpumalanga,
North West and the Western Cape. The team has expanded the range of services offered, to include
a video streaming platform, an online solution for radio stations and an extensive menu of Rich
Media Tools. Steady progress has been made in taking these to market.
DIVIDENDS
A final dividend (dividend number 9) of 250 cents per ordinary share (gross) was declared for the
year ended 31 March 2016 (2015: 250 cents gross) and paid on 4 July 2016. The interim dividend
(dividend number 10) for the period ended 30 September 2016 is 100,00 cents per ordinary share
(gross) (2015: 100 cents per share).
DECLARATION OF INTERIM DIVIDEND NUMBER 10
The board has declared an interim dividend (dividend number 10) of 100 cents per ordinary
share (gross) for the period ended 30 September 2016. The dividend is subject to the Dividends
Withholding Tax ("DWT") that was introduced with effect from 1 April 2012. In accordance with
the provisions of the JSE Listings Requirements, the following additional information is disclosed:
- the dividend has been declared out of current profits available for distribution
- the local Dividend Tax rate is 15%
- the gross dividend amount is 100 cents per ordinary share for shareholders exempt
from DWT
- the net dividend amount is 85 cents per ordinary share for shareholders liable for DWT
- the company has 8 054 424 ordinary shares in issue
- the company's income tax reference number is 9100/169/71/4
The following dates are applicable to the dividend:
The last day to trade in order to be eligible for the dividend will be Tuesday, 10 January 2017
Shares will trade ex-dividend from Wednesday, 11 January 2017.
The record date will be Friday, 13 January 2017 and payment will be made on Monday,
16 January 2017.
Share certificates may not be dematerialised/rematerialised between Wednesday, 11 January 2017
and Friday, 13 January 2017, both days inclusive.
PROSPECTS
The board expects the trading conditions for the remaining six months of the year to remain
challenging.
ACG Molusi
Independent Non-executive Chairman
24 November 2016
These condensed results have been prepared by the financial director in accordance with
International Financial Reporting Standards ("IFRS"), the Companies Act No. 71 of 2008, as
amended, IAS 34: Interim Financial Reporting, the Listings Requirements of the Johannesburg Stock
Exchange, Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council and
the SAICA Financial Reporting Guidelines as issued by the Accounting Practices Committee, on a
basis consistent with the policies and methods of computation as used in the annual financial
statements for the year ended 31 March 2016.
These results are unaudited.
Michelle Mynhardt CA(SA)
Financial Director
CORPORATE INFORMATION
REGISTERED OFFICE
Block A, Oxford Office Park
No 5, 8th Street, Houghton Estate, Johannesburg, 2198
PO Box 3014, Houghton, 2041
TRANSFER SECRETARIES
Computershare Investor Services (Pty) Limited
Registration number 2004/003647/07
Ground Floor, 70 Marshall Street, Johannesburg, 2001
PO Box 61051, Marshalltown, 2107
Telephone: +27 11 370 5000
Telefax: +27 11 688 5238
DIRECTORS
ACG Molusi (Independent Non-executive Chairman)
KL Tlhabane (Independent Non-executive Director)
MJ Prinsloo (Independent Non-executive Director)
N Sooka (Independent Non-executive Director)
M Mynhardt (Executive Financial Director)
AJ Isbister (Executive Director)
COMPANY SECRETARY
C Roberts
SPONSOR
Arbor Capital Sponsors (Pty) Limited
Registration number 2006/033725/07
Ground Floor, One Health Building
Woodmead North Office Park
54 Maxwell Drive
Woodmead, 2191
Suite #439, Private Bag X29, Gallo Manor, 2052
www.ame.co.za
Date: 24/11/2016 02:40:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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