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Audited Abridged Financial Results for the year ended 30 September 2018
Cafca Limited
Share Code: CAC
ISIN Code: ZW0009011942
Notice To Shareholders
Audited Abridged Financial Results for the year ended 30 September 2018
All figures are in United States Dollars
30 SEPT 2018 30SEPT 2017
STATEMENT OF COMPREHENSIVE INCOME
Revenue 30,382,348 19,310,457
Operating profit 5,232,656 1,223,077
Finance income 1,364 3,150
Profit before income tax 5,234,020 1,226,227
Income tax expense (1,374,589) (500,014)
Profit for the year 3,859,430 726,213
Other comprehensive income: - -
Total comprehensive income for the year 3,859,430 726,213
Issued Ordinary Shares (weighted) (number) 33,059,000 33,059,000
Basic Earnings per share (cents) 11.67 2.21
Diluted Earnings per share(number) 33,459,000 33,459,000
Diluted Earnings per share (cents) 11.53 2.17
Headline earnings per share(number) 33,059,000 33,059,000
Headline earnings per share(cents) 11.67 2.18
STATEMENT OF FINANCIAL POSITION AT 31 SEPT 2018 AT 31 SEPT 2017
ASSETS $ $
Non-Current Assets
Property ,plant and equipment 2,990,638 3,263,957
Current assets
Inventories 8,624,425 8,256,431
Current income tax receivables - 18,540
Trade and other trade receivables 2,035,613 2,389,492
Available for sale financial assets 6,180 18,540
Cash and cash equivalents 8,854,476 4,168,171
Total Assets 22,511,332 18,115,541
Equity attributable to owners of the parent
Share Capital 331 328
Share premium 254,701 177,948
Share option reserve 193,600 20,056
Retained earnings 15,648,704 15,260,469
Total Equity 16,097,336 15,458,801
LIABILITIES
Non-current liabilities
Deferred income tax liabilities 656,692 788,880
Current liabilities
Trade and other payables 1,740,628 1,496,132
Provisions 427,288 371,728
Currrent income tax liabilities 118,193 -
Dividend payable 3,471,195 -
Total liabilities 6,413,996 2,656,740
Total equity and liabilities 22,511,332 18,115,541
STATEMENT OF CHANGES IN EQUITY
Share Capital Share Premium Share Option Retained
reserve earnings Total
$ $ $ $ $
Balance at 1 October 2016 328 169,281 5,300 14,534,256 14,709,165
Transfer of non-distributable reserve
Transaction with owners:
Issue of shares - 5,200 - - 5,200
Share options - 3,467 14,756 18,223
Total comprehensive income for the year - - - 726,213 726,213
Net profit for the year - - - 726,213 726,213
Other comprehensive income for the year - - - - -
Balance at 30 September 2017 328 177,948 20,056 15,260,469 15,458,801
Balance at 1 October 2017 328 177,948 20,056 15,260,469 14,458,801
Transaction with owners:
Issue of shares - 40,400 - - 40,400
Share options 3 36,353 173,544 - 209,900
Dividend declared - - - (3,471,195) (3,471,195)
Total comprehensive income for the year - - - 3,859,430 3,859,430
Profit for the period - - - 3,859,430 3,859,430
Other comprehensive income for the year - - - - -
Balance at 30 September 2018 331 254,701 193,600 15,648,704 16,097,336
STATEMENT OF CASH FLOWS
30 September 2018 30 September 2017
Profit before income tax 5,234,020 1,226,227
Depreciation 361,528 358,763
Non-cash employee share based payment charge 209,900 18,223
Profit on sale of property plant,
and equipment (3,770) (14,723)
Finance income 1,364 3,150
Provision for slow moving obsolete inventories 1,628 (69,137)
(Decrease)/increase in allowance for impairment of
trade receivables (24,446) 8,809
Working capital changes:
(Increase)/decrease in inventories (369,623) 120,118
Decrease in trade and other receivables 378,326 928,033
Increase in trade and other payables 244,496 760,478
Increase in provision for other liabilities and charges 55,560 42,724
Net cash generated from operations 6,101,342 3,382,665
Tax paid (1,369,633) (328,410)
Finance income (1,364) (3,150)
Net generated from operating activities 4,730,345 3,051,105
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property ,plant and equipment (88,209) (376,455)
Proceeds from sale of property,plant and equipment 3,770 14,723
Net cash utilised in investing activities (84,439) (361,732)
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of share capital 40,400 5,200
Increase in cash and cash equivalents 4,686,305 2,694,573
Cash and cash equivalents at the beginning of the year 4,168,171 1,473,598
Cash and cash equivalents at the end of year 8,854,476 4,168,171
NOTES THE FINANCIAL STATEMENTS
For the year ended 30 September 2018
1.CAFCA Limited (the “Company”) manufactures and supplies cables for transmission and distribution of energy and information.It is a public
limited company incorporated in Zimbabwe.The Company has its primary listing on the Zimbabwe Stock Exchange and secondary listing on the
Johannesburg Stock Exchange.
Basis of preparation
2.The financial statements of CAFCA Limited the (the “Company”) have been prepared in accordance with International Financial reporting Standards
(“IFRS”) and interpretations issued by IFRS Interpretations Committee.( “IFRS IC”) applicable to companies reporting under IFRS and in the manner
required by the Zimbabwe Companies Act(Chapter 24:03).The financial statements have been prepared under the historical cost convention.
Audit opinion
3. These financial results should be read in conjunction with the complete set of financial statements for the year ended 30 September 2017,which
have been audited by PricewaterhouseCoopers Chartered Accountants (Zimbabwe).The auditors unqualified audit opinion includes a section on key
audit matters as defined by ISA 701,’Communicating key audit matters in the independent auditors report, relating to trading conditions and
assessment of impairment of property,plant and equipment.This includes both the rationale for determining the key audit matters and how they were
addressed during the audit.
The key audit matters
-Impact of trading conditions on the entity’s operations
-Impairment assessment of plant and equipment
The auditor’s report on the financial results is available for inspection at the Company’s registered office.
4.The financial statements are presented in United States Dollars which is the functional currency of the Company.
5.Related party transactions
Reunert Electrical Engineering (Proprietary)Limited owns 70% of the company and the remaining 30% are widely held.
The following transactions were carried out with related parties:
30 September 30 September
2018 2017
(i) Sale of goods
Metal Fabricators of Zambia Plc( Zamefa) 18,345 411,365
(ii)Purchases during the period from the holding company:
CBI-Electric African Cables-A Division of ATC( Pty) Limited 2,602,046 729,207
CBI-Electric Telecoms Cable(Pty) Limited 23,627 17,336
Metal Fabricators of Zambia Plc(Zamefa) 56,983 1,393,489
(iii)Year end balances arising from purchase of goods/services:
a.Amounts due to related parties:
CBI-Electric African Cables-A Division of ATC (Pty) Limited 7,950 33,826
CBI-Electric Telecoms (Pty) Limited - 17,336
b.Amounts due from related parties
Metal Fabricators of Zambia Plc(Zamefa) - 106,644
(iv)Key management remuneration:
Key management includes directors(executive and non-executive)
and members of the executive committee
Salaries and short term benefits 655,336 582,170
Share options charge 209,336 18,223
Director’ emoluments
-Fees 65,058 80,016
Total 930,294 680,409
6.Segmentation information
The executive management team is the Company’s chief operating decision maker. Management has determined the operating segments based on
reports reviewed by the executive team that are used to make strategic decisions. The Company has one product line, and operates in one industry
sector.
Revenue is primarily from customers who are domiciled in Zimbabwe and revenue from external customers pertains mainly to customers domiciled in
Zambia,Malawi and Mozambique.
Revenue analysis
30 September 2018 30 September 2017
Revenue for customers domiciled in Zimbabwe 30,382,345 18,256,550
Revenue from external customers 1,054,457 1,053,907
30,382,348 19,310,457
Revenue from transactions with single and local customers that amount to 10% of more each of the Group’s revenues , equal approximately
US$6,583,033(2017 $6,879,764).These revenues are attributable to customers domiciled in Zimbabwe. The breakdown of the major component of the
total revenue from three major customers of least 10% is as follows:
30 September 2018 30 September 2017
Energy Transmission 6,583,033 5,879,764
The total of non-current assets located in Zimbabwe is $2,990,638 (2017:$3,263,957) and there are no non-current assets located in other
countries.
The segment information provided to the executive team for the product reportable segments for the year ended 30 September are as follows:
30 September 2018 30 September 2017
Revenue from customers 30,382,345 19,310,457
Profit before interest and taxation 5,234,020 1,226,227
Net finance income 1,364 3,150
Finance cost 1,374,589 500,013
Total assets 22,511,332 18,115,541
Liabilities 6,413,996 2,656,740
30 September 2018 30 September 2017
8.Property plant and equipment
Capital expenditure 88,209 173,684
Depreciation 361,528 358,763
COMMENTARY AND OVERVIEW OF RESULTS
Revenue & Volumes
An increase in volume together with a change in sales mix from aluminium to copper resulted in turnover increasing 57% year on year. Most of the
growth was in the local market resulting mainly from protection by Government of local manufacturers.
Profitability
Operating profit improved four fold from the previous year of $1,2 million to $5,2 million in the current year.
As mentioned in our trading statement:
“Profitability has been improved by strong local demand and a change in sales mix from aluminium to copper products. The high level of finished
goods brought forward from the previous year has also contributed and allowed us to hold prices throughout the year.”
“The prior year was adversely affected by a volume decrease that resulted in breakeven months until the cost base was significantly reduced –
this cost base has since been maintained.”
Statement of Financial Position and Cashflow
Cash balances as at the yearend were $8,9 million of which $3,5 million was set aside for the dividend and $4,0 million retained for capital
expenditure.
There were no foreign liabilities and no significant trade and other payables.
Stocks at the beginning of the year were $8,2 million and closed at $8,6 million as a hedge against hyperinflation and short term availability of
foreign exchange.
Outlook
The economy since the year end has taken a significant down turn as a result of the acute foreign exchange shortage and the market has discounted
the (Real Time Gross Transfer Settlement) RTGS bank balances vis-à-vis the value of US dollars.
Until such time as the authorities can put in place a more equitable and stable system of foreign currency allocation it will be difficult to
predict the fortunes of either the economy or the company.
Dividend
The Directors approved on the 6th September 2018 a dividend of 10.5 cents per share to shareholders which was paid on the 5th October 2018.
By order of Board
C Kangara
Company Secretary
16 November 2018
Directors: H.P. Mkushi (Chairman) R.N. Webster (Managing)
E.T.Z Chidzonga P.E De Villiers G.Eddey A.E. Dickson A. Mabena S.E Mangwengwende G.J.H Steyn T.A Taylor
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