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Provisional Reviewed Group Consolidated Results For The Year Ended 31 March 2018
Niveus Investments Limited
(Incorporated in the Republic of South Africa)
Registration number: 1996/005744/06
JSE share code: NIV
ISIN code: ZAE000169553
("the Company" or "the Group" or "Niveus")
PROVISIONAL REVIEWED GROUP CONSOLIDATED RESULTS for the year ended 31 March 2018
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Reviewed Audited
31 March 31 March
2018 2017
R'000 R'000
ASSETS
Non-current assets 484 664 1 315 728
Property, plant and equipment 114 159 659 202
Investment properties 262 758 28 638
Goodwill 11 714 59 944
Intangible assets 12 830 18 480
Interest in associates and joint ventures 35 322 73 707
Other financial assets 38 779 -
Deferred taxation 1 040 28 251
Loans receivable 8 062 447 506
Current assets 287 676 1 057 007
Other 28 142 348 273
Cash and cash equivalents 259 534 708 734
Assets of disposal group classified as held for sale 855 273 5 419
Total assets 1 627 613 2 378 154
EQUITY AND LIABILITIES
Equity 1 400 212 1 881 755
Equity attributable to equity holders of the parent 924 356 1 314 265
Non-controlling interest 475 856 567 490
Non current liabilities 44 088 231 344
Borrowings - 205 623
Deferred taxation 44 088 21 348
Operating lease equalisation liability - 4 373
Current liabilities 183 313 262 596
Liabilities of disposal group classified as held for sale - 2 459
Total equity and liabilities 1 627 613 2 378 154
Net asset value per share (cents) 776 1 103
Net tangible asset value per share (cents) 756 1 038
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
Audited
Reviewed Year ended
Year ended 31 March
31 March 2017
2018 Restated
R'000 R'000
Revenue 42 608 18 519
Net gaming win 79 012 52 686
Group revenue 121 620 71 205
Other income - 2 851
Operating expenses (129 307) (136 106)
(7 687) (62 050)
Depreciation and amortisation (29 869) (34 216)
Share of (losses) profits of associates and joint ventures (2 287) 736
Investment income 86 054 49 717
Fair value adjustment of other financial assets 5 539 -
Fair value adjustments of investment properties 48 119 -
Impairment of assets (775) (1 982)
Impairment of goodwill - (3 958)
Impairment of investment in associate - (6 971)
Gain on disposal of subsidiaries - 6 074
Finance costs (5 662) 1 147
Profit before taxation 92 499 (51 503)
Taxation (48 848) (6 637)
Profit/(loss) for the year from continuing operations 43 650 (58 140)
Net result from discontinued operations 164 508 (68 308)
Profit/(loss) for the year 208 158 (126 448)
Attributable to:
Equity holders of the parent 184 260 (9 154)
Non-controlling interest 23 899 (117 294)
208 159 (126 448)
Audited
Reviewed Year ended
Year ended 31 March
31 March 2017
2018 Restated
R'000 R'000
Reconciliation of headline earnings Gross Net Gross Net
Continuing operations
Earnings attributable to equity holders of the parent 31 999 (68 751)
IAS 16 Gains on disposal of plant and equipment (3) (3) - -
IAS 16 Impairment of assets 775 775 1 982 889
IAS 27 Loss from disposal of subsidiaries - - (6 074) (4 252)
IAS 28 Impairment of investment in associate - - 6 971 4 880
IAS 36 Impairment of goodwill - - 3 958 3 958
IAS 40 Fair value adjustment to investment property (48 119) (37 341) - -
(4 570) (63 276)
Discontinued operations
Earnings attributable to equity holders of the parent 152 262 59 597
IAS 16 Loss on disposal of plant and equipment (904) (904) (519) (309)
IAS 16 Impairment of assets 3 228 3 228 1 767 1 272
IAS 27 Loss from disposal of subsidiaries (67 597) (67 597) - -
IAS 28 Impairment of investment in joint venture - - 85 49
IAS 40 Fair value adjustment to investment property 1 426 1 107 (403) (313)
Loss on disposal of operating assets of KWV - - 503 629 216 485
88 095 276 781
Audited
Reviewed Year ended
Year ended 31 March
31 March 2017
2018 Restated
Earnings per share (cents) 154,6 (7,7)
- Continuing operations 26,85 (57,7)
- Discontinued operations 127,78 50,0
Headline earnings per share (cents) 70,09 179,2
- Continuing operations (3,84) (53,1)
- Discontinued operations 73,93 232,3
Diluted earnings per share (cents) 153,67 (7,6)
- Continuing operations 26,69 (57,3)
- Discontinued operations 126,98 49,7
Diluted headline earnings per share (cents) 69,82 178,1
- Continuing operations (3,82) (52,8)
- Discontinued operations 73,64 230,8
Actual number of shares in issue at end of year ('000) 119 163 119 163
Weighted average number of shares in issue ('000) 119 163 119 163
Weighted average number of shares in issue (diluted) ('000) 119 910 119 909
CONDENSED CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
Audited
Reviewed Year ended
Year ended 31 March
31 March 2017
2018 Restated
R'000 R'000
Profit/(loss) for the year 208 158 (126 448)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Change in use - revaluation of property - Gross 52 184
Change in use - revaluation of property - Tax (11 689)
Foreign currency translation differences (20 305) (20 725)
Total comprehensive income/(loss) 228 348 (147 173)
Attributable to:
Equity holders of the parent 187 298 (29 879)
Non-controlling interest 41 050 (117 294)
228 348 (147 173)
Total comprehensive income attributable to equity holders of the parent arises from:
- Continuing operations 35 762 (90 908)
- Discontinued operations 151 537 61 029
187 299 (29 879)
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Reviewed Audited
Year ended Year ended
31 March 31 March
2018 2017
R'000 R'000
Balance at beginning of year 1 881 755 2 080 498
Shares issued -
Total comprehensive income/(loss) 228 349 (147 173)
Equity-settled share-based payments (781) 7 303
Effects of changes in holding (16 608) (4 424)
Business combinations 17 392 (1 596)
Capital reductions and dividends (709 894) (52 853)
Balance at end of year 1 400 213 1 881 755
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Reviewed Audited
Year ended Year ended
31 March 31 March
2018 2017
R'000 R'000
Cash flows from operating activities 554 873 357 744
Cash generated from operations 568 263 430 038
Net interest 68 557 (7 519)
Taxation paid (81 947) (64 775)
Cash flows from investing activities (573 115) 293 536
Property, plant and equipment: additions (232 739) (165 154)
Proceeds from disposal of assets 143 252 532 791
Investment in associates and joint ventures (45 962) (48 516)
Sale of businesses (204 882)
Investment in financial assets (217 348)
Other (15 436) (25 585)
Cash flows from financing activities (430 958) (102 512)
Dividends paid (302 679) (38 965)
Long-term funding received/(repaid) 122 361 (63 547)
Short-term funding repaid (250 640)
(Decrease)/increase in cash and cash equivalents (449 200) 548 768
Classified as held for sale - (1 105)
Cash and cash equivalents
At beginning of year 708 734 161 071
At end of year 259 534 708 734
SEGMENTAL ANALYSIS
Audited
Reviewed Year ended
Year ended 31 March
31 March 2017
2018 Restated
R'000 R'000
Revenue
Continuing operations 42 608 18 519
Gaming and entertainment 20 969 13 174
Other 6 200 -
Property 15 439 5 345
Discontinued operations 55 718 635 065
Beverages - 566 898
Other - -
Gaming and entertainment 55 718 68 167
98 327 653 584
Net gaming win
Continuing operations
Gaming and entertainment 79 012 52 686
Discontinued operations
Gaming and entertainment 865 097 1 273 924
944 108 1 326 610
EBITDA
Continuing operations (7 686) (62 049)
Gaming and entertainment 17 074 (7 835)
Head office and other (18 848) (47 054)
Property (5 912) (7 160)
Discontinued operations 236 660 529 170
Beverages - 81 725
Other - -
Gaming and entertainment 236 660 447 445
228 974 467 121
Profit before tax
Continuing operations 92 498 (51 503)
Gaming and entertainment (13 126) (43 257)
Head office and other (19 778) (44 610)
Property 125 402 36 364
Discontinued operations 137 601 (106 630)
Beverages - (426 177)
Other - -
Gaming and entertainment 137 601 319 547
219 532 (158 133)
Headline earnings
Continuing operations (4 570) (63 276)
Gaming and entertainment (13 251) (39 369)
Head office and other (21 252) (43 990)
Property 29 933 20 083
Discontinued operations 88 095 276 781
Beverages - 31 528
Other - -
Gaming and entertainment 88 095 245 253
83 525 213 505
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Basis of preparation and accounting policies
The provisional condensed consolidated financial statements for the year ended 31 March 2018 have been prepared in accordance
with International Financial Reporting Standards ("IFRS"), IAS 34 Interim Financial Reporting, the SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee, the Financial Reporting Pronouncements as issued by the Financial
Reporting Standards Council, the requirements of the South African Companies Act, 71 of 2008, as amended ("Companies Act") and
the Listings Requirements of the JSE Limited ("Listings Requirements"). The accounting policies of the Group are consistent
with those applied for the year ended 31 March 2017. The adoption of new standards that are applicable for this financial year
had no impact on the figures presented. Details of the standards adopted will be provided in the annual financial statements.
As required by the Listings Requirements, the Group reports headline earnings in accordance with Circular 2/2015 - Headline
Earnings, as issued by the South African Institute of Chartered Accountants. These financial statements were prepared under the
supervision of the financial director, Ms C Kristal CA(SA).
Review of the independent auditor
The provisional condensed consolidated financial statements for the year ended 31 March 2018 have been reviewed by
Grant Thornton Johannesburg Partnership, who expressed an unmodified review conclusion. The auditor's report does not necessarily
report on all of the information contained in the 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.
Change in use
The change in use of certain property resulted in its reclassification from property, plant and equipment to investment property.
These properties were fair valued through other comprehensive income prior to being transferred to investment property.
The effect of the change in use was R40 million, net of deferred tax, recognised in the statement of other comprehensive income.
Discontinued operations
Unbundling of shares in gaming businesses
During June 2017, Niveus accepted an indicative offer from Tsogo Sun Holdings Limited for the sale of all its interests in
Vukani Gaming Corporation Proprietary Limited ("Vukani"), Galaxy Gaming and Entertainment Proprietary Limited ("Galaxy") and
all their associated entities, trusts and businesses (collectively the "Gaming Businesses") to Tsogo, subject to certain
conditions precedent. These conditions were met in November 2017 and the sale became effective. Revenue and expenses, and gains
and losses relating to these assets have been removed from the results of continuing operations and are shown as a single line
item ("Net result from discontinued operations") on the face of the consolidated statement of profit or loss.
The operating results of the discontinued operations and the loss on sale of assets were as follows:
Reviewed Audited
Year ended Year ended
31 March 31 March
2018 2017
R'000 R'000
Profit relating to discontinued operations
Revenue 54 836 68 120
Net gaming win 865 097 1 269 924
Other income and operating costs (702 086) (888 799)
Share of losses of associates and joint ventures (4 882) (7 081)
Investment income 3 561 4 357
Depreciation and amortisation (55 288) (91 027)
Asset impairments (17 394) (1 767)
Fair value adjustments of investment properties (1 426) 403
Loss on disposal of business 86 050 -
Finance costs (15 384) (31 479)
Profit before taxation 213 085 322 651
Taxation (40 689) (64 703)
Profit from discontinued operations 172 396 257 948
Cash flows from discontinued operations
Cash flows from operating activities 418 039 229 539
Cash flows from investing activities (485 729) (97 948)
Cash flows from financing activities 170 644 (64 325)
102 954 67 266
Proceeds on disposal, net cash flow on disposal and analysis of assets and liabilities disposed
Property, plant and equipment 418 957
Goodwill 50 433
Intangible assets 10 381
Investments in associates and joint arrangements 76 243
Other financial assets 35 769
Deferred tax asset 31 481
Other non-current assets 12 027
Inventories 8 385
Trade and other receivables 116 085
Cash and cash equivalents 181 154
Trade and other payables (349 528)
Current income tax liabilities (14 659)
576 728
Non-controlling interest 12 443
Disposal proceeds set off against repurchase consideration (134 538)
Dividend in specie (540 683)
Profit on disposal 86 050
Cash and cash equivalents at date of disposal (181 154)
Net cash outflow (181 154)
Shares in gaming businesses
During March 2017, it was contracted to dispose of subsidiaries Jacaranda Royal Casino Limited, VSlots Lesotho (Proprietary)
Limited and VSlots Swaziland (Proprietary) Limited. Revenue and expenses, and gains and losses relating to these assets have
been removed from the results of continuing operations and are shown as a single line item on the face of the consolidated
statement of profit or loss ("Net result from discontinued operations"). The operating results of the discontinued operations
and the loss on sale of assets were as follows:
Reviewed Audited
Year ended Year ended
31 March 31 March
2018 2017
R'000 R'000
Loss relating to discontinued operations
Revenue 882 47
Net gaming win - 4 000
Other income and operating costs 9 699 (5 846)
Depreciation and amortisation (13) (1 301)
Loss on disposal of subsidiary (18 454)
Finance costs (2) (3)
Loss from discontinued operations (7 888) (3 103)
Remeasurement of disposal group - -
Net result from discontinued operations (7 888) (3 103)
Cash flows from discontinued operations
Cash flows from operating activities 447 (2 216)
Cash flows from investing activities - 1 571
447 (645)
Proceeds on disposal, net cash flow on disposal and analysis of assets and liabilities disposed
Property, plant and equipment 1 503
Intangible assets 1 187
Other financial assets 42
Trade and other receivables 834
Cash and cash equivalents 189
Other financial liabilities (13 231)
Trade and other payables (1 650)
(11 126)
Non-controlling interest 6 041
Loss on disposal (18 454)
Cash and cash equivalents at date of disposal (189)
Net cash outflow (23 728)
Operating assets of KWV
During September 2017, the operating assets of KWV were disposed of to the Vasari group. The revenue and expenses, and gains
and losses relating to these assets were removed from the results of continuing operations in the 2017 financial year and were
included in the single line item "Net result from discontinued operations" on the face of the consolidated statement of profit
or loss
Assets held for distribution
The current year assets of disposal group classified as held for sale balance represents the 38% shareholding in Hosken Passenger
Logistics and Rail Limited ("HPL&R"), which is held for distribution - Refer subsequent events
Subsequent events
Subsequent to year-end, La Concorde unbundled the shares it acquired in HPL&R to La Concorde shareholders by way of a distribution
in specie.
COMMENTARY
In November 2017 Niveus unbundled its gaming interest, other than its sports betting and lottery interests ("GameCo"), to
Niveus shareholders with Tsogo subsequently making an offer to shareholders to acquire their interest in Gameco. The interest
in the Kuruman Casino was retained by Niveus on loan account with GameCo pending regulatory approval. The consolidated results
reflect GameCo as discontinued operations until the unbundling and offer transaction.
La Concorde
The Niveus Group owns a 58% interest in the La Concorde Group. Prior to February 2018, a wholly owned subsidiary of La Concorde
("Newco") was capitalised with R1,1 billion of cash and cash equivalents. In February 2018, Newco acquired 100% of the issued
shares in HPL&R Investment Proprietary Limited, which holds 100% of Golden Arrow Bus Services (Proprietory) Limited and 76%
of Eljosa Travel Tours Proprietary Limited, from Hosken Consolidated Investments Limited ("HCI") for R1,8 billion. The purchase
price was settled by the issue of approximately 62% of the issued shares in Newco to HCI.
In February 2018, Newco declared a cash dividend of approximately R650 million to its shareholders. La Concorde Group received
approximately R247 million of the Newco cash dividend and declared a dividend of R3,62 per share to its shareholders subsequently,
in February 2018. Niveus, as a 58% shareholder of La Concorde Holdings Limited, received approximately R143 million and proceeded
to declare a dividend of R1,20 per share to its shareholders on 14 February 2018.
Newco's name was changed to Hosken Passenger Logistics and Rail Limited (HPL&R), and on 13 April 2018 La Concorde unbundled its
interest in HPL&R to its shareholders. HPL&R was listed on the Main Board of the JSE on 24 April 2018 and unbundled by Niveus
to its shareholders on 30 April 2018.
The remaining assets of La Concorde consist mainly of investment property, art and cash. Additions to the La Concorde head
offices were made during the year with development plans for vacant land being considered.
Other assets
Niveus has an interest in online sports betting and retail sports betting licences of which five became operational during the
year. Niveus is satisfied with the growth rates of the industry.
Niveus invested in a start-up investment developing radar tracing products in the golf industry. Continued development progress
is made and R24 million was invested during the year with the remaining R5 million of an initial facility expected to be advanced
in June 2018.
The operations of Niveus AG ceased, following the closure of the African operations as well as the sale of Gameco to Tsogo.
Niveus AG has a cash balance of approximately R140 million.
Muriel Loftie-Eaton
Chief executive officer
23 May 2018
Paarl
CORPORATE INFORMATION
Niveus Investments Limited
(Incorporated in the Republic of South Africa)
Registration number: 1996/005744/06
JSE share code: NIV
ISIN code: ZAE000169553
("the Company" or "the Group" or "Niveus")
Directors: JA Copelyn+, CE Kristal*, MM Loftie-Eaton*, ML Molefi#, JG Ngcobo#, RD Watson#, Y Shaik+, A van der Veen+
(* executive + non-executive # independent non-executive)
Company secretary: HCI Managerial Services Proprietary Limited
Transfer secretaries: Computershare Investor Services Proprietary Limited
Sponsor: PSG Capital Proprietary Limited
www.niveus.co.za
Date: 23/05/2018 02:30:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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