Wrap Text
Unaudited group financial results and cash dividend declaration for the six month period ended 31 December 2019
Adcock Ingram Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 2007/016236/06)
Share code: AIP ISIN: ZAE000123436
("Adcock Ingram" or "the Company")
UNAUDITED GROUP FINANCIAL RESULTS AND CASH DIVIDEND DECLARATION
FOR THE SIX MONTH PERIOD ENDED 31 DECEMBER 2019
Continuing operations
- B-BBEE level 1
- REVENUE AND TRADING PROFIT INCREASES 1%
- OPERATING EXPENSES FLAT
- CASH ON HAND R363 million
- INTERIM DIVIDEND 100 cents per share
Introduction
On 29 July 2019, Adcock Ingram became a subsidiary of The Bidvest Group Limited,
with minority shareholders owning 49% of the Company. Closer interactions
are now taking place between Adcock Ingram and Bidvest, including the appointment
of an additional Director to the Adcock Ingram Board of Directors to assist in
exploring strategic possibilities for Adcock Ingram, to complement its range of
trusted healthcare products.
In November, Adcock Ingram was certified as a B-BBEE level 1 provider,
endorsing the Group's focus on Transformation as an imperative.
South African consumers remain under financial pressure, due to the country's
low economic growth, high levels of unemployment and ongoing utility problems.
The results for the six-month period ended 31 December 2019 reflect the difficult
trading conditions and constrained consumer environment.
Against this background, the Board is satisfied with the profits for the half year
under review, particularly that with strict cost control and a relentless focus on
customer service, growth in both revenue and trading profit was achieved.
Unaudited Unaudited
Six months Six months
ended ended
Change 31 December 31 December
% 2019 2018
Continuing operations
Revenue from contracts
with customers (R'000) 1 3 628 386 3 594 581
Gross profit (R'000) - 1 394 855 1 389 661
Trading profit (R'000) 1 490 134 485 454
Operating profit (R'000) 1 461 776 456 956
Headline earnings per share (cents) 1 218,5 217,2
Basic earnings per share (cents) 3 219,3 213,0
Total operations
Revenue from contracts
with customers (R'000) (1) 3 628 386 3 680 821
Gross profit (R'000) (1) 1 394 855 1 414 751
Trading profit (R'000) - 490 134 490 372
Operating profit (R'000) - 461 776 461 874
Headline earnings per share (cents) - 218,5 219,5
Basic earnings per share (cents) 2 219,3 215,3
Total assets (R'000) 6 850 967 6 416 768
Net asset value per share (cents) 2 608,9 2 412,5
Dividend per share (cents) 100,0 100,0
Prospects
The effect of the current economic climate on consumer spending and behaviour remains
concerning. In the absence of sustainable SEP increases, margins will continue to be
under pressure from cost increases, particularly labour, transport and utilities, and
active ingredient prices which are directly linked to currency fluctuations.
To attempt to protect margins, the Group has placed a heightened focus on
driving productivity in the factories, strict cost control and expanding the
Group's product portfolio, by acquisition or partnership, particularly in less
regulated product classes.
Dividend policy
Shareholders are advised that the Board has approved a change to the Company's
dividend policy, from dividends covered 2 to 3 times by headline earnings,
to 2 to 2.5 times.
Dividend distribution
The Board has declared an interim gross dividend out of
income reserves of 100 cents per share in respect of the
six months ended 31 December 2019. The South African
dividend tax ("DT") rate is 20% and the net dividend payable
to shareholders who are not exempt from DT is 80 cents per
share. Adcock Ingram currently has 175,758,861 ordinary
shares in issue and qualifying for ordinary dividends.
The income tax reference number is 9528/919/15/3.
The salient dates for the distribution are detailed below:
Last date to trade cum distribution Tuesday, 10 March 2020
Shares trade ex distribution Wednesday, 11 March 2020
Record date Friday, 13 March 2020
Payment date Monday, 16 March 2020
Share certificates may not be dematerialised or rematerialised
between Wednesday, 11 March 2020 and Friday, 13 March 2020,
both dates inclusive.
LP Ralphs AG Hall
Chairman Chief Executive Officer
Approved by the Board: 19 February 2020
SENS release date: 20 February 2020
Company secretary
NE Simelane
Registered office
1 New Road,
Midrand, 1682
Postal address
Private Bag X69,
Bryanston, 2021
Transfer secretaries
Computershare Investor Services Proprietary Limited,
Rosebank Towers,
15 Biermann Avenue,
Rosebank,
Johannesburg, 2196.
PO Box 61051,
Marshalltown, 2107
Auditors
PricewaterhouseCoopers Inc,
4 Lisbon Lane,
Waterfall, 2090
Sponsor
Rand Merchant Bank
(a division of FirstRand Bank Limited),
1 Merchant Place,
corner Fredman Drive and Rivonia Road,
Sandton, 2196
Bankers
Nedbank Limited,
135 Rivonia Road,
Sandown, Sandton, 2146.
Rand Merchant Bank,
1 Merchant Place,
corner Fredman Drive and Rivonia Road,
Sandton, 2196.
Investec Bank Limted,
100 Grayston Drive,
Sandton, 2146
The full-long form announcement is available at https://senspdf.jse.co.za/documents/2020/JSE/ISSE/AIP/AIP012020.pdf
The contents of this short-form summary announcement are the responsibility of the Board of Directors. Any investment
decision should be considered and based on the content of the information contained in the full announcement which
will be published on the Company's website at www.adcock.com/investors/financialreports. Copies of the full announcement
are available for inspection at the registered office of the Company and may be requested without charge during office
hours by phoning +27 11 635 0143.
Date: 20-02-2020 07:05:00
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