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Condensed Audited Group Results for the Year Ended 30 September 2016 & Dividend Declaration
CULLINAN HOLDINGS LIMITED
TOURISM AND LEISURE
(Registration number 1902/001808/06)
(CUL ISIN: ZAE000013710)
(CULP ISIN: ZAE000001947)
CONDENSED AUDITED GROUP RESULTS FOR THE YEAR ENDED 30 SEPTEMBER 2016 AND DIVIDEND
DECLARATION
GROUP FINANCIAL HIGHLIGHTS
Revenue up by 16%
Profit before tax up by 36% to R103.3m
Cash generated from operations R236m (2015: R60.3m)
Cash resources increased to R229m (2015: R108m)
Dividend maintained at 2c for the year
Group condensed statement of financial position
Audited Audited
Year end 30 Year end 30
September September
2016 2015
R'000 R'000
ASSETS
Non-current assets 409 239 408 202
Property, plant and equipment 255 428 258 813
Investment properties 13 350 10 900
Goodwill 100 030 99 948
Intangible assets 20 595 24 321
Investment in joint venture 11 981 7 054
Investment in associate companies 3 152 3 732
Deferred tax asset 4 703 3 434
Current assets 728 833 636 802
Other current assets 499 139 528 171
Cash and cash equivalents 229 694 108 631
Total assets 1 138 072 1 045 004
EQUITY AND LIABILITIES
Equity attributable to equity holders of parent
Share capital 157 634 157 634
Reserves 38 411 23 005
Retained income 290 812 236 497
486 857 417 136
Non-controlling interest 3 291 3 218
Total shareholders' equity 490 148 420 354
Non-current liabilities 66 796 84 701
Loans from shareholders 45 000 70 000
Other financial liabilities 500 500
Operating lease liability 9 073 5 320
Deferred tax liability 12 223 8 881
Current liabilities 581 128 539 949
Other current liabilities 581 128 539 949
Total equity and liabilities 1 138 072 1 045 004
Group condensed statement of comprehensive income
Audited Audited
Year end 30 Year end 30
September September
2016 2015
R'000 R'000
Revenue 1 040 674 894 326
Turnover 1 033 738 888 575
Cost of sales (400 602) (335 107)
Gross profit 633 136 553 468
Other income 35 798 31 749
Operating expenses (569 328) (510 239)
Trading profit 99 606 74 978
Investment revenue 6 936 5 751
Finance expenses (5 991) (3 923)
Fair value adjustments 710 -
Income from equity accounted investment 2 129 (857)
Profit before taxation 103 390 75 949
Tax expense (32 267) (19 953)
Profit for the period 71 123 55 996
Other comprehensive income:
Gains and losses on property revaluation (244) -
Exchange differences on translating
foreign operations 2 455 (215)
Effects of cash flow hedges 7 856 (7 856)
Total comprehensive income for the 81 190 47 925
period
Profit attributable to:
equity holders 70 318 56 321
non-controlling interest 805 (325)
Total comprehensive income attributable to:
equity holders 80 385 48 250
non-controlling interest 805 (325)
Basic earnings per share (cents) 8.79 7.04
Diluted earnings per share (cents) 8.64 6.91
Group condensed statements of changes in equity
Audited Audited
Year end 30 Year end 30
September September
2016 2015
R'000 R'000
Share capital
Balance at beginning and end of period 8 548 8 548
Share premium
Balance at beginning and end of period 149 086 149 086
Share capital reduction reserve fund
Balance at beginning and end of period 20 876 20 876
Capital redemption reserve fund
Balance at beginning and end of period 4 4
Foreign currency translation reserve
Balance at beginning of period (1 574) (1 359)
- Reserve on translation of foreign subsidiary 2 455 (215)
Balance at end of period 881 (1 574)
Revaluation reserve
Balance at beginning of period 870 870
- Movement for the period (244) -
Balance at end of period 626 870
Share-based payment reserve
Balance at beginning of period 10 685 6 626
- Expense for the period 5 339 4 059
Balance at end of period 16 024 10 685
Hedging reserve
Balance at beginning of period (7 856) -
- Movement for the period 7 856 (7 856)
Balance at end of period - (7 856)
Retained income
Balance at beginning of period 236 497 196 179
Attributable profit for period 70 318 56 321
Ordinary dividend paid (16 003) (16 003)
Balance at end of period 290 812 236 497
Non-controlling interest
Balance at beginning of period 3 218 4 180
- Profit attributable to non-controlling interest 805 (325)
- Dividend paid to non-controlling interest (732) (637)
Balance at end of period 3 291 3 218
Group condensed statement of cash flows
Audited Audited
Year end 30 Year end 30
September September
2016 2015
R'000 R'000
Net cash inflow / (outflow) from
operating activities 183 876 30 452
Net cash outflow from
investing activities (37 394) (166 590)
Net cash (outflow) / inflow from
financing activities (25 732) 69 363
Net (decrease) / increase in cash
and cash equivalents 120 750 (66 775)
Effect of exchange rate changes on cash
and cash equivalents 222 (10 579)
Cash and cash equivalents
at beginning of the period 108 369 185 723
Cash and cash equivalents
at end of the period 229 341 108 369
Notes
1. Basis of preparation
The condensed group financial statement extracts have been 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. The results contain the information required
by IAS34 Interim Financial Reporting and are in compliance with the Listings Requirements of the
Johannesburg Stock Exchange and the South African Companies Act (2008).
The accounting policies and methods of computation used in the preparation
of the results are consistent with those used in the annual financial statements for
the year ended 30 September 2015.
2. Notes to the statement of comprehensive income
Audited Audited
Year end 30 Year end 30
September September
2016 2015
Ordinary shares ('000)
- In issue 800 173 800 173
- Weighted average 800 173 800 173
- Diluted weighted average 814 245 815 221
R'000 R'000
Determination of headline earnings
Earnings attributable to ordinary shareholders 70 318 56 321
(Profit) / losses on disposal
of property, plant and equipment 573 (116)
Tax effect (160) 32
Revaluations of investment property (710) -
Tax effect 159 -
Change in capital gains tax rate 331 -
Headline earnings 70 511 56 237
Headline earnings per share (cents) 8.81 7.03
Diluted headline earnings per share (cents) 8.66 6.90
Dividends per share (cents) 2.00 2.00
3. Segmental reporting
Travel and Marine and Financial Corporate
Tourism Boating Services Services Total
R'000 R'000 R'000 R'000 R'000
30 September 2016
Revenue 852 893 69 663 115 481 2 637 1 040 674
Trading profit 129 915 5 424 13 525 (49 258) 99 606
30 September 2015
Revenue 709 305 63 260 121 899 (139) 894 325
Trading profit 95 596 3 237 16 325 (40 180) 74 978
Segmental reporting is aligned with the information that the chief operating decision maker
reviews in order to make decisions about the allocation of resources across the business
either directly or indirectly
4. Business combination
Chester Finance
On 1 October 2014, Cullinan Holdings Limited acquired the trade finance business of Chester
Finance (Pty) Limited. Please refer to the 2015 annual financial statements for details of this
business combination.
Annual financial statements
These group condensed financial statement extracts should be read in conjunction with the audited 2016 annual
financial statements issued on the 15 December 2016. The group financial statements were prepared by
D Standage, the Financial Director of the Group.
The directors take full responsibility for the preparation of this abridged report and that the
financial information has been correctly extracted from the underlying annual financial statements.
Approval of annual financial statements
The annual financial statements were approved by the Board of Directors on 14 December 2016.
Audit opinion
These abridged consolidated group financial statements have been extracted from the issuer's audited
annual financial statements upon which Mazars have issued an unqualified report but has not itself been audited.
The annual financial statements, together with the unqualified audit report issued by the company's auditors, Mazars,
is 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 / financial results. 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 the auditor's report together with the accompanying financial information from the issuer's registered office.
Annual general meeting
The annual general meeting of Shareholders will be held in the boardroom, 2nd floor, Travel House, 6 Hood Avenue,
Rosebank at 10:00 on the 17th February 2017 to transact the business as stated in the annual general meeting
notice forming part of the integrated annual report.
Overview
We are pleased to report a strong performance in the 2016 year. Revenue increased by 16% to R1.04b
(2015: R894m) while profit before tax increased by 36% to R103.3m (2015:R75.9m). The group generated R236m
(2015: R60.3m) in cash from operations, which resulted in a substantial increase in cash on hand at year-end.
This reflects the improved operating performance in 2016 and improvement in working capital. The group
ended the year with R229m in cash resources (2015: R108m).
2016 saw a particularly strong upturn and performance in our inbound tourism businesses. The marine
division performed well and our local travel and outbound tourism businesses generally held up well despite
a weaker rand and in some areas gained further market share. Forward bookings are positive and continued
strength is expected in the inbound tourism market during 2017. We have also seen an upturn in some of our
local and outbound tourism businesses in the latter part of 2016.
Looking at non-financial measures of performance, we are pleased to report that 21 participants graduated
from our internal mentorship programme in 2016 (148 graduates have graduated since the program was
started). The mentorship programme is aimed at upskilling and developing employees in our group and has
significantly contributed towards their personal growth and advancement.
The group is a member of The Treadright Foundation, established by the Tollman Family. The Treadright
Foundation is a non-profit foundation which aims to encourage sustainable tourism through conservation,
leadership and support for communities. Some of its many programmes are focused on preventing the
destruction of endangered species, such as rhino, sharks and lions. The foundation also supports a number
of community projects amongst its various other projects.
Our IT systems have performed well during the year and we expect to see a further positive impact from
these new developments in 2017.
Our financial services division was impacted by the effects of a weaker local economy in 2016, but we have
seen an improvement in business levels over the past 3 months. As a result, we are confident that we will
continue to see an upturn in this division during 2017.
The group gearing position remains low, which provides opportunity to access debt should the group
require. The R100m loan facility concluded with The Travel Corporation in 2014 remains in place. The group
currently utilises R45m of the facility (2015: R70m) which was established to provide back-up funding for the
financial services division.
It is however with sadness that I need to report that two non-executive directors passed away during the year.
Mike Ness served on the Cullinan board for 14 years and Sindiswa Nhlumayo for 5 years. Their contribution
will be greatly missed. In addition, Ami Azoulay resigned as a non-executive director after 5 years and we
would like to take this opportunity to thank him for his contribution during that period.
As a result of the above, the company appointed Mervyn Burton and Anita Mendiratta as Independent
non-executive directors and Lance Tollman as an executive director. We welcome these experienced
new directors to our board and look forward to their contribution in 2017.
Looking ahead to 2017, significant capital expenditure is planned for our coach fleet to ensure that the
brand leadership position of our coach fleet is maintained. We will continue to look for acquisitions in
the tourism and financial services sectors while maintaining our focus on delivering exceptional service
and value to our customers.
We are optimistic about the prospects for 2017 although the requirement for visitors to South Africa to
produce unabridged birth certificates for minors continues to have a negative impact on the South
African inbound tourism sector and remains a concern.
Declaration of Final Dividend No. 138
The Board is pleased to announce the declaration of a final dividend of 1 cent per ordinary share in respect
of the year ended 30 September 2016.
The dividend will be subject to the Dividends Tax that was introduced with effect from 1 April 2012.
In accordance with the provisions of the Listings Requirements of the Johannesburg Stock Exchange, the following
additional information is disclosed:
- the dividend has been declared out of income reserves
- the local Dividends Tax rate is 15%
- the gross local dividend amount is 1 cent per share for shareholders exempt from Dividends Tax
- the net local dividend amount is 1 cent less 15% per share (0.85 cents per share) for shareholders liable for Dividends Tax
- Cullinan has 800 173 385 ordinary shares in issue
- Cullinan's income tax reference number is: 9130 002 60 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, 17 January 2017.
Shares will trade ex-dividend from Wednesday, 18 January 2017.
The record date will be Friday, 20 January 2017 and payment will be made on Monday, 23 January 2017.
Share certificates may not be dematerialised or rematerialised between Wednesday, 18 January 2017 and Friday, 20 January 2017,
both days inclusive.
We would like to take this opportunity to thank our board, executives, our staff and our partners for their
support and for a great effort and contribution during the 2016 year.
On Behalf of the Board
M Tollman D Standage
Chief Executive Officer Financial Director
15 December 2016
Auditors Company secretary
Mazars were re-elected as auditors in 2016. B Allison
Sponsor
Arbor Capital Sponsors (Pty) Limited Registered office
(Registration number 2006/033725/07) 6 Hood Avenue, Rosebank, 2196
Directors
Executive: M TOLLMAN, LA PAMPALLIS, DK STANDAGE, L TOLLMAN
Non-Executive: G TOLLMAN (Chairman) #, DD HOSKING #, R ARENDSE*, M BURTON*, A MENDIRATTA #*
# Non Resident *Independent
Transfer secretaries
Computershare Investor Services (Pty) Limited,
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
(PO Box 61051, Marshalltown, 2107)
For further information on group activities, please write to:
The Company Secretary, Cullinan Holdings Limited,
PO Box 41032, Craighall, 2024
(Registration number 1902/001808/06)
(CUL ISIN: ZAE000013710)
(CULP ISIN: ZAE000001947)
Date: 15/12/2016 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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