Wrap Text
Audited provisional announcement of consolidated financial results for the year ended 28 February 2017
Wilderness Holdings Limited
“Wilderness” or “the Company” or “the Group”
Share code: WIL ISIN: BW0000000868
Registration number: 2004/2986
BSE: Primary Listing
JSE: Secondary Listing
Tax reference number: C075372-01-01-7
Audited provisional announcement of consolidated financial results
for the year ended 28 February 2017
www.wilderness-holdings.com
Highlights
- Revenue up 18% to P1 107 million
- EBITDA up 5% to P209 million
- Adjusted EBITDA* up 16% to P184 million
- TRevPAR** up 18%
- Profit after tax down 15% to P63 million
- Cash generated by operations up 15% to P156 million
- Cash dividend up 10% to 16.5 thebe per share
- Occupancy rate flat at 58%
* Adjusted EBITDA excludes the effects of the Governors’ acquisition and
foreign exchange (losses)/gains.
** Total revenue per available room (TRevPar) is calculated as total
revenue from travel experience divided by total available rooms.
Summarised consolidated statement of comprehensive income
Audited Audited
Year ended Year ended
P’000 28 Feb 2017 Change 29 Feb 2016
Revenue 1 107 467 18% 935 087
Cost of sales (353 447) (276 186)
Gross profit 754 020 658 901
Other gains 16 182 374
Operating expenses (550 018) 13% (486 206)
Foreign exchange (losses)/gains (11 317) 26 241
Operating profit for year before
items listed below (EBITDA) 208 867 5% 199 310
Impairment (loss)/gain (3 165) 796
Depreciation and amortisation (76 927) (64 736)
Operating profit 128 775 (5%) 135 370
Net finance costs (9 195) (4 288)
Unrealised foreign exchange
loss on loans (20 806) (12 215)
Share of associate company profit 2 600 1 502
Profit before taxation 101 374 (16%) 120 369
Taxation (38 623) (46 241)
Profit for the year 62 751 (15%) 74 128
Other comprehensive income/(loss)
Items that may be subsequently
reclassified to profit or loss
Exchange differences on translating
foreign operations: 17 059 (11 824)
Equity holders of the Company 14 248 (1 950)
Non-controlling interest (1 288) 2 376
Net investment in foreign operations 4 099 (12 250)
Total comprehensive income
for the year 79 810 62 304
Profit attributable to:
Owners of the Company 55 497 76 525
Non-controlling interest 7 254 (2 397)
62 751 74 128
Total comprehensive income
attributable to:
Owners of the Company 73 844 62 325
Non-controlling interest 5 966 (21)
79 810 62 304
Number of shares issued (thousands)
Issued 236 859 231 882
Weighted average 233 781 231 882
Diluted weighted average 235 246 242 195
Earnings per share (thebe)
Basic 23.74 (28%) 33.00
Diluted 23.59 (25%) 31.60
Summarised consolidated statement of financial position
Audited Audited
as at as at
P’000 28 Feb 2017 29 Feb 2016
Assets
Non-current assets 795 849 554 950
Property, plant and equipment 571 121 483 688
Goodwill 69 152 32 901
Intangible assets 119 694 10 743
Investments and loans in associates 12 700 10 100
Deferred tax assets 23 182 17 518
Current assets 428 919 378 621
Inventories 31 952 24 442
Receivables and prepayments 140 968 95 523
Current tax receivable 23 818 9 525
Bank balances and cash 232 181 249 131
Total assets 1 224 768 933 571
Equity and liabilities
Equity attributable to the owners
of the Company 507 985 481 287
Stated capital 167 291 156 086
Foreign currency translation reserve 24 080 5 733
Common control reserve (73 324) (73 324)
Other non-distributable reserves 19 318 19 318
Share-based payment reserve (518) 23 051
Retained income 371 138 350 423
Non-controlling interest 28 586 (11 759)
Total equity 536 571 469 528
Non-current liabilities 226 759 72 411
Borrowings 160 617 43 423
Deferred tax liabilities 66 142 28 988
Current liabilities 461 438 391 632
Trade and other payables 385 923 310 873
Borrowings – current portion 7 210 32 116
Current tax liabilities 6 603 1 477
Bank overdrafts 61 702 47 166
Total liabilities 688 197 464 043
Total equity and liabilities 1 224 768 933 571
Additional disclosure
Audited Audited
Year ended Year ended
P’000 28 Feb 2017 29 Feb 2016
Reconciliation between profit
attributable to owners of the
Company and headline earnings
Profit attributable to owners
of the Company 55 497 76 525
Adjustments
Gains and compensation on disposal and
impairment of property, plant and
equipment (6 128) (6 321)
Profit on disposal of interests in
subsidiaries (10 134) -
Impairment of assets 3 204 (911)
Tax effects of adjustments 2 841 2 402
Minority interest (299) 250
Headline earnings 44 981 71 945
Headline earnings per share
Basic 19.24 31.03
Diluted 19.12 29.71
Commitments
Capital
Authorised by directors and contracted for 110 006 1 783
Not yet contracted for but authorised by
directors 129 381 211 534
239 387 213 317
It is intended to finance capital expenditure
from working capital generated and existing
borrowing facilities
Operating leases
Minimum lease payments due
– within one year 16 929 21 369
– in second to fifth year inclusive 39 557 59 280
– after fifth year 66 229 89 743
122 715 170 392
Borrowings
Non-current
Interest bearing 157 661 63 053
Non-interest bearing 10 166 12 486
Less: Current portion of long-term liabilities (7 210) (32 116)
160 617 43 423
Summarised consolidated statement of cash flows
Audited Audited
Year ended Year ended
P’000 28 Feb 2017 29 Feb 2016
Net cash generated from operating
activities 155 868 135 022
Net cash used in investing activities (209 587) (128 270)
Net cash used in financing activities 27 861 (64 679)
Net decrease in cash and cash equivalents (25 858) (57 927)
Unrealised exchange (losses)/gains on
foreign cash balances (5 628) 25 975
Cash and cash equivalents at the
beginning of the period 201 965 233 917
Cash and cash equivalents at the end of
the period 170 479 201 965
Summarised consolidated statement of changes in equity
Audited Audited
Year ended Year ended
P’000 28 Feb 2017 29 Feb 2016
Opening balance 469 528 444 031
Share issue on settlement of share scheme 11 205 –
Minority portion of dividend paid (3 269) (3 919)
Dividends paid (34 782) (34 782)
Total comprehensive income for the period 79 810 62 304
Net share-based payment reserve (23 569) 7 616
Acquisition of subsidiary 27 100 –
Disposal of subsidiary 10 548 –
Acquisition of additional interest – (5 722)
Closing balance 536 571 469 528
Comprising:
Stated capital 167 291 156 086
Foreign currency translation reserve 24 080 5 733
Common control reserve (73 324) (73 324)
Other non-distributable reserves 19 318 19 318
Share-based payment reserve (518) 23 051
Retained income 371 138 350 423
Total shareholders' equity 507 985 481 287
Non-controlling interest 28 586 (11 759)
Total equity 536 571 469 528
Segmental information
Audited Audited
Year ended Year ended
P’000 28 Feb 2017 29 Feb 2016
Segment profit
Botswana 122 677 123 736
Kenya 9 523 (1 233)
Namibia 16 833 17 787
Rwanda 6 914 –
South Africa 39 173 32 067
Zambezi 8 959 342
Intergroup (77) (4)
Group 204 002 172 695
Depreciation and amortisation
Botswana (37 942) (31 951)
Kenya (2 737) (23)
Namibia (11 495) (10 826)
Rwanda (397) –
South Africa (6 408) (7 112)
Zambezi (17 948) (14 824)
Group (76 927) (64 736)
Transactions unallocated to a segment
Other gains 16 182 374
Foreign exchange (losses)/gains (11 317) 26 241
Impairment losses (3 165) 796
Interest paid (11 096) (5 748)
Interest received 1 901 1 460
Unrealised forex loss – loans (20 806) (12 215)
Associate earnings 2 600 1 502
Profit before taxation 101 374 120 369
Taxation (38 623) (46 241)
Profit after tax 62 751 74 128
Segmental assets
Botswana 705 077 516 032
Kenya 48 314 2 465
Namibia 143 138 133 357
Rwanda 70 626 6 619
South Africa 199 714 208 278
Zambezi 122 019 111 601
Central financing activities and
eliminations (64 120) (44 781)
Group 1 224 768 933 571
Founded in Botswana in 1983, Wilderness Holdings is an award- winning and
globally respected ecotourism company present in the prime wilderness and
wildlife areas of southern and east Africa. Pivoted off the continent’s
most diverse portfolio of luxury safari camps, the Group operates a
vertically integrated business model that combines the ownership of
product (safari camps), support services (bush airline, and touring and
transfer services), and marketing, sales and reservations businesses.
Collectively, these are termed “the travel experience” and serve to ensure
certainty of supply, ownership of the supply chain and a seamless service
to both the client (the travel trade) and the consumer (our guest).
Commentary
This was a positive year overall, as the Group achieved 18% and 5% growth
in revenue and EBITDA, respectively. This is despite the significant turn
in foreign exchange from a profit of P26 million to a loss of P11 million,
as the volatile currency environment impacted negatively on headline
earnings. However, this volatility is expected to recur periodically as
the Group operates in multiple jurisdictions and in different currencies.
Trading performance was therefore much improved at 16% growth in Adjusted
EBITDA which resulted in an increase of 15% in cash generated by operations.
With the delay of the renewals of key leases in Botswana now over, the
Group has commenced the rebuild of Mombo camp, while the acquisition of
our 51% interest in the Governors’ Camp Collection in Kenya and Rwanda
proved highly satisfactory with pleasing results. In addition, the Group
has almost completed its building of the new Bisate Lodge in Rwanda, and
has continued its substantial investment in IT systems and the repositioning
of the Group in line with its strategy.
Financial review
The Group increased bednights sold by 18% but recorded a decline in headline
earnings per share (HEPS) of 38%.
Governors’ acquisition
The results include nine months of the Governors’ businesses which have
been consolidated from 1 July 2016. These operations contributed P95 million
and P20 million to revenue and EBITDA, respectively.
Financial performance
Revenue increased by 18% to P1 107 million (2016: P935 million) driven by the
increase in bednights sold. Overall bednight sales increased by 18% to 165 864
(2016: 140 162); excluding Governors’, bednight sales grew by 2%. The Governors’
brand contributed 22 946 or 14% in bednight sales. Available bednights have
increased by 19% to 286 350 (2016: 240 748); excluding Governors’, available
bednights increased by 1%. The Group’s occupancy rate remained flat at 58%.
The benefit of the 9% depreciation of the Pula against the US Dollar experienced
over the first half of the year was negated by its appreciation of 2% over the
remaining six months. During high season, between July and October, the Pula
depreciated by 4% against the US Dollar compared to the prior year. As a result,
the significantly weaker local currencies in the first half of the year did not
have a material impact on revenue, as initially expected.
EBITDA margin declined from 21% to 19%, primarily due to the foreign exchange
losses incurred from the translation of the Group’s foreign currency position
(comprised mainly of US Dollar cash reserves) compared to the gain in the prior
year. Adjusted EBITDA margin, which excludes the effects of the Governors’
transaction and the foreign exchange losses, increased from 19% to 20%.
Operating costs, on a like for like basis excluding Governors’, have remained
well contained and increased by only 5%.
Other gains of P16 million include proceeds from insurance claims amounting to
P6 million and profit on disposal of a subsidiary of P10 million. Impairment
losses related to the impairment of camp assets due to fire damage.
In line with the Group’s hedging strategy, forward cover remains at zero percent
of calculated forward exposure until, in the opinion of the Board, the Rand
fundamentals make cover necessary.
Net finance costs were 114% higher at P9.2 million (2016: P4.3 million), being
a consequence of the inclusion of Governors’, the increased debt to finance
capital investment and acquisitions, as well as an accounting adjustment in
respect of restoration costs provision.
The Group’s effective tax rate has remained steady at 38%. The tax rate is
higher than the nominal tax rate due to the higher tax rates applicable in other
tax jurisdictions, losses incurred where deferred tax assets could not be
recognised, as well as unrealised foreign exchange losses which are generally
not claimable for tax purposes.
Geographical operations
The Zambezi region recorded good growth with segmental profit at P9 million
compared to a break-even position in the prior year. The growth was driven
predominantly by improved sales mix and higher demand for our road transfer
business. South Africa recorded 22% growth in profit attributed to the weaker
average exchange rates and an increase in demand for local non-Wilderness
product resulting in higher service fees. Kenya and Rwanda, comprising
substantially the Governors’ brand, contributed to the remaining growth.
Botswana was flat due to the discounting of Mombo camp bednights in the
expectation that the rebuild would already be underway, necessitating the
relocation of guests to a temporary facility, while Namibia, which was
negatively impacted by the flying operations, recorded a decline in profit
of 5%.
Financial position and cash flow
Capital expenditure and commitments
Taking into account the lease renewals, new or development capital expenditure
is set to continue at the current high levels and, in line with the Group’s
philosophy to ensure our properties and assets remain in pristine condition,
the Group continues to spend material amounts annually on maintenance capital.
Excluding acquisitions, capital expenditure for the year amounted to
P143 million. Approximately P40 million was spent on new camp developments,
P26 million on rebuilding existing camps and once-off or timing related costs
amounting to P18 million made up of aircraft engines, solar plant, vehicles
and camp improvements following fire damage. The balance of P60 million is
defensive or maintenance in nature.
The Board has approved P239 million in capital expenditure for the next year
comprising new or strategic projects amounting to P166 million, including
Mombo camp, and the rebuilding of an existing camp.
Shares in issue
During the year the Company issued 4 976 402 ordinary shares at no par value
(representing approximately 2.1% of the enlarged number of shares in issue) for
no consideration to settle the share scheme obligations. At 28 February 2017
the number of ordinary shares in issue and the weighted average number of
shares was 236 858 853 (2016: 231 882 451) and 233 781 074 (2016: 231 882 451),
respectively.
Bank and cash
Cash balances, less overdrafts, have decreased by 16% to P170 million as a
portion of the capital expenditure, acquisition of Governors’ and other
financing activities were financed out of internally generated cash
and existing cash reserves.
A new multi-currency facility comprising long-term debt amounting to
USD30 million and a short-term overdraft of USD5 million, was raised. The
facility is favourably priced and flexible to allow for expansion opportunities
into other countries. At year end, USD12.5 million of the long-term facility
had been utilised.
Dividend
The Group has elected to pay a dividend higher than its maximum policy of
two times cover as it views the foreign exchange losses as an external factor
based on elements at a given moment in time and not a reflection of the Group’s
performance and fundamentals. In addition, the Group’s cash reserves and
projected cash flows support the dividend proposed.
Accordingly, notice is hereby given that a final dividend for the year ended
28 February 2017 of 16.5 thebe per share (15.2625 thebe per share net of
Botswana withholding tax) was declared on Wednesday, 24 May 2017. The dividend
has been declared out of income reserves. Botswana dividends withholding tax
of 7.5% is applicable to all shareholders who are not exempt and registered
on the Botswana share register. The foreign dividend shall be paid in Rand
to shareholders on the South African register, calculated at the Pula to
Rand exchange rate on Wednesday, 24 May 2017 which was P1/R1.2648
and accordingly the gross dividend payable is 20.87 cents per share
(16.696 cents per share net of South African withholding tax). South African
dividends withholding tax of 20% is applicable to all shareholders who are
not exempt and are registered on the South African share register. The issued
shares at the declaration date are 236 858 853 (2016: 231 882 451).
The salient dates of the dividend will be as follows:
Last date to trade ‘cum’ dividend on the
JSE share register Monday, 12 June 2017
Shares commence trading ‘ex’ the dividend
on the JSE share register Tuesday, 13 June 2017
Record date for JSE shareholders recorded
in the share register Thursday, 15 June 2017
Record date for the BSE shareholders
recorded in the share register Friday, 16 June 2017
Payment date Monday, 26 June 2017
The South African branch register will be closed for the purposes of
dematerialisation and rematerialisation within the South African register,
and transfers between the South African and Botswana registers may not take
place, between Monday, 12 June 2017 and Thursday, 15 June 2017, both days
inclusive.
Tax implications for non-resident shareholders on the South African branch
register:
Foreign dividends received by non-resident shareholders on the South African
branch register during this financial year would have been subject to South
African dividends withholding tax at 20%, unless the rate was reduced in terms
of any applicable agreement for the avoidance of double taxation between South
Africa and the country of residence of the non-resident shareholder (DTA:
Double Tax Agreement) or if any specific exemption applied. A reduced dividend
withholding rate in terms of the applicable DTA or the foreign dividend
exemption in section 64F(j) would only have been relied on if the non-resident
shareholder provided the following forms (both in the form prescribed by the
Commissioner of the South African Revenue Services) to their Central Securities
Depository Participant (CSDP) or broker, as the case may be, in respect of
certificated shares before the date of payment of the relevant dividend:
– A declaration that the dividend was subject to a reduced rate as a result
of the application of the DTA before the date of payment of the relevant
dividend; and
– A written undertaking to inform their CSDP or broker, as the case may be,
should the circumstances affecting the reduced rate have changed or the
beneficial owner ceased to be the beneficial owner.
If applicable, where the applicable documents were not received by the date
of payment of the relevant dividend, and the reduced rate or exemption was
not applied at the time the dividend was paid, the non-resident shareholders
are advised to contact their CSDP or broker, as the case may be, to arrange
for the abovementioned documents to be submitted in order for a refund of the
over-withheld amount of dividends withholding tax. Please note that the
necessary documents must be submitted within three years after the date of
payment of the relevant dividend.
Subsequent events
No material events have occurred between the reporting date and the date of
this report.
Leases
As previously advised, the Botswana government has renewed several leases to
existing operators. The Group has now received its draft leases for the
concessions upon which Mombo, Little Mombo and Xigera camps are located and
these are in the process of being finalised. Accordingly, the Group expects
the leases for the concessions upon which Vumbura Plains and Little Vumbura are
situated to follow suit. The rebuilding of Mombo camp has commenced following
permission to proceed from the Botswana Government.
Clarification of recent press reports related to Air Botswana
The Group has submitted an Expression of Interest in the privatisation of
Air Botswana in response to a public invitation from Government in February
but there has been no further progress in the matter. Investors will be kept
advised in the normal manner should there be any further concrete
developments in this regard.
Basis of preparation
The provisional summarised financial information has been prepared in
accordance with the framework concepts and the measurement and recognition
requirements of International Financial Reporting Standards and the
information as required by IAS 34 Interim Financial Reporting. The report
has been prepared using accounting policies that comply with International
Financial Reporting Standards, in a manner that is consistent with those
applied in the prior year financial statements.
Changes in accounting policies and comparability
The Group has adopted certain new standards, amendments and interpretations
to existing standards which are effective for the financial year beginning
1 March 2016. The adoption of amendments to these standards has not had any
material impact on previously reported figures.
Independent auditor’s opinion
The auditors, Deloitte & Touche, have issued their opinion on the
consolidated financial statements for the year ended 28 February 2017. The
audit was conducted in accordance with International Standards on Auditing.
They have issued an unmodified audit opinion. These summarised consolidated
financial statements have been derived from the consolidated financial
statements and are consistent in all material respects thereof. A copy of
their audit report is available for inspection at the Company’s registered
office. Any reference to future financial performance included in this
announcement has not been reviewed or reported on by the Group’s auditors.
Outlook
Our forward occupancy book is encouraging but the continued discounting
of Mombo bednights until the new camp opens in December or January will
continue to weigh on performance. Further weakness of the US Dollar would
place additional pressure on performance, but the inverse will apply if it
appreciates as well.
The development of Bisate Lodge in Rwanda continues to progress well and
remains on schedule to open in June 2017. The Governors’ camps received a
facelift with further developments in the pipeline.
The Group’s strategic intent is to invest in African tourism markets which
offer authentic wildlife and safari experiences and where we feel our
specific ecotourism model can have positive conservation and community
impacts.
By order of the Board
Keith Vincent Ami Azoulay
Chief Executive Officer Chief Financial Officer
24 May 2017
Wilderness Holdings Limited
Registered office (Botswana): Deloitte House, Plot 64518, Fairgrounds,
Gaborone, Botswana
External company registration number: 2009/022894/10
Registered office (South Africa): 373 Rivonia Boulevard, Rivonia,
South Africa. PO Box 5219, Rivonia 2128, South Africa
BSE: Primary Listing
JSE: Secondary Listing
JSE Sponsor: Arbor Capital Proprietary Limited
Transfer secretaries: Corpserve Botswana – Computershare
Directors: BBP Tafa (Chairman), M Tollman (Deputy Chairman),
KNW Vincent (CEO), A Azoulay (CFO), DA de la Harpe, JM Hunt, RJ Marnitz,
MW McCulloch, GB Tollman, MPK ter Haar, C Vinsonneau, J Zeitz
Group Company Secretary: Desert Secretarial Services (Proprietary) Limited
Date: 26/05/2017 02:00:00 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 
