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Consolidated financial results for the year ended 31 December 2019
Brimstone Investment Corporation Limited
ISIN Number: ZAE000015277
Share Code: BRT
ISIN Number: ZAE000015285
Share Code: BRN
Company Registration Number: 1995/010442/06
(Incorporated in the Republic of South Africa)
("Brimstone" or "the Company" or "the Group")
Consolidated financial results for the year ended 31 December 2019
Significant events
- Profit before net finance costs increased by R321 million to R659 million
- Acquisition of an additional 9.5 million shares in Oceana for
R686 million increasing shareholding to 24%
- R1.2 billion raised in a share-backed Zero-Cost-Collar funding
arrangement over Life Healthcare shares
- Capitalisation issue of 7 "N" Ordinary shares per 100 shares held
FINANCIAL OVERVIEW
Year ended Year ended
31 December 31 December
R'000 2019 2018
Revenue 4 440 085 3 376 655
Operating profit 656 109 388 559
Fair value losses (71 672) (177 599)
Other investment losses (69 680) (43 440)
Share of profits of associates and joint ventures 144 136 170 479
Profit for the year 75 329 71 323
(Loss)/profit attributable to:
Equity holders of the parent (85 774) (78 505)
Non-controlling interests 161 103 149 828
75 329 71 323
Loss per share (cents)
Basic (35.8) (32.4)
Diluted (35.8) (32.4)
Headline loss per share (cents)
Basic (58.1) (21.1)
Diluted (58.1) (21.1)
ASSETS
Non-current assets 8 177 991 7 949 448
Current assets 3 089 154 2 947 103
TOTAL ASSETS 11 267 145 10 896 551
EQUITY AND LIABILITIES
Capital and reserves 3 676 688 3 867 250
Non-current liabilities 4 902 810 4 660 904
Current liabilities 2 687 647 2 368 397
TOTAL EQUITY AND LIABILITIES 11 267 145 10 896 551
NAV per share (cents) 1 066.3 1 123.8
Shares in issue at end of year (000's) 235 979 241 446
Dividends per share (cents) - 45
CAPITALISATION ISSUE
1. Details of the Capitalisation Issue
Brimstone's board has resolved to allot and issue "N" Ordinary shares,
("Capitalisation Shares"), as a capitalisation issue ("Capitalisation
Issue") to Brimstone Ordinary and "N" Ordinary shareholders
(collectively, "Brimstone Shareholders") pro rata to their current
holdings.
The rationale for the Capitalisation Issue is to conserve Brimstone's
current cash resources during the present operating environment. Such
cash resources will be deployed towards reducing debt and to take
advantage of value enhancing investment opportunities.
The number of Capitalisation Shares to which Brimstone Shareholders
are entitled in terms of the Capitalisation Issue will be 7 "N"
Ordinary shares for every 100 "N" Ordinary and/or Ordinary shares held.
Where a Brimstone Shareholder's entitlement to Capitalisation Shares
in relation to the Capitalisation Issue gives rise to a fraction of a
new Capitalisation Share, such fraction will be rounded down to the
nearest whole number and the cash balance will be paid to the
Brimstone Shareholder ("Cash Payment"). The Cash Payment will be
determined based on the volume weighted average price of an
"N" Ordinary share, on Wednesday, 6 May 2020, discounted by 10%.
An announcement will be released on SENS on Thursday, 7 May 2020
advising Brimstone Shareholders of the Cash Payment amount.
2. Salient dates and times of the Capitalisation Issue
2020
Declaration date of Capitalisation Issue Tuesday, 10 March
Finalisation date of Capitalisation Issue Friday, 24 April
Last day to trade cum the Capitalisation Issue Tuesday, 5 May
Capitalisation Shares listed Wednesday, 6 May
Ordinary Shares and "N" Ordinary Shares commence
trading ex-entitlement to the Capitalisation Issue Wednesday, 6 May
Announcement on SENS of Cash Payment applicable
to fractional entitlements before 11:00 Thursday, 7 May
Record date to receive the Capitalisation Shares Friday, 8 May
Accounts with CSDP or broker credited with the
Capitalisation Shares or share certificates
issued evidencing the Capitalisation Shares Monday, 11 May
Adjustment of number of new shares listed
on or about Wednesday, 13 May
Shares may not be rematerialised or dematerialised from Wednesday,
6 May 2020 to Friday, 8 May 2020, both days inclusive.
3. Tax implications
3.1 The Capitalisation Issue is not a dividend as defined by the Income
Tax Act and therefore will not attract Dividends Withholding Tax
("DWT"). The Capitalisation Issue may have tax implications and
Brimstone Shareholders are advised to obtain appropriate advice from
their professional advisors in this regard.
3.2 The Cash Payment in respect of fractions arising from the
Capitalisation Issue will be deemed to be a dividend from an income
tax perspective and DWT will be deducted at a rate of 20%.
4. Foreign shareholders
The right to receive the Capitalisation Shares in jurisdictions other
than the Republic of South Africa may be restricted by law and
failure to comply with any of these restrictions may constitute a
violation of the securities laws of any such jurisdictions.
Accordingly, shareholders will not be entitled to receive the
Capitalisation Shares, directly or indirectly, in those
jurisdictions. More specifically, the Capitalisation Shares have
not been and will not be registered for the purposes of the
Capitalisation Issue under the securities laws of the United Kingdom,
European Economic Area or EEA, Canada, United States of America,
Japan or Australia and accordingly are not being offered, sold,
taken up, re-sold or delivered directly or indirectly to recipients
with registered addresses in such jurisdictions.
5. Exchange Control
The Capitalisation Issue is subject to Exchange Control approval
and an announcement will be released on SENS once this has been
obtained.
In terms of the Exchange Control Regulations of South Africa:
5.1 In the case of certificated shareholders:
- any new share certificate that might be issued to non-resident
shareholders will be endorsed "non-resident"; and
- any new share certificates based on emigrants' Brimstone shares
controlled in terms of the Exchange Control Regulations will be
forwarded to the authorised dealer in foreign exchange controlling
their blocked assets. Such new share certificates will be endorsed
"non-resident".
5.2 In the case of dematerialised shareholders:
- any Capitalisation Shares issued to emigrants from the common
monetary area and all other non-residents of the common monetary
area, will be credited to their Central Securities Depository
Participant ("CSDP") or broker's account and a "non-resident"
annotation will appear in the CSDP or broker's register;
Non-resident and emigrant dematerialised shareholders will have all
aspects relating to exchange control managed by their CSDP or broker.
6. Additional information
- The Capitalisation Shares will be distributed from Brimstone's
share premium, resulting in a decrease in share premium of R173.
- As at the date of this declaration announcement, the number of
Ordinary shares and "N" Ordinary shares eligible to receive
Capitalisation Shares are 39 874 146 and 207 650 175, respectively
(this excludes treasury shares of 3 664 000 "N" Ordinary Shares
which are not eligible to receive the Capitalisation Shares).
- Brimstone's tax reference number is 9397002719.
Shareholders are advised that the Company has not declared a dividend
for the year ended 31 December 2019.
INTRINSIC NET ASSET VALUE (INAV)
INAV at 31 December 2019 calculated on a line-by-line basis, totalled
R3.35 billion, or R14.19 per share (31 December 2018: R3.90 billion or
R16.15 per share), representing a decrease of 14.11% from 2018 (a decrease
of 12.12% on a per share basis). As at 31 December 2019, Brimstone Ordinary
shares were trading at a discount of 46.1% to INAV (31 December 2018: 35.0%)
and "N" Ordinary shares traded at a discount of 45.4% to INAV (31 December
2018: 41.2%). The analysis of INAV is available on the Company's website at
http://www.brimstone.co.za.
The INAV information presented in this report has been prepared on a basis
consistent with that used in the Integrated Report for the year ended
31 December 2018, except for the valuation of MTN Zakhele Futhi which is
now valued at its quoted share price as opposed to the option valuation
method used previously.
F Robertson MA Brey
Executive Chairman Chief Executive Officer
10 March 2020
DIRECTORATE AND ADMINISTRATION
Registered office: Boundary Terraces, 1 Mariendahl Lane, Newlands, 7700,
Cape Town
Transfer Secretaries: Computershare Investor Services (Pty) Ltd,
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
Sponsor: Nedbank CIB, 135 Rivonia Road, Sandton, 2196
Directorate: F Robertson (Executive Chairman)*, MA Brey (Chief Executive
Officer)*, GG Fortuin (Financial)*, MI Khan (Chief Operating Officer)*,
T Moodley*, PL Campher (Lead Independent), M Hewu, N Khan, KR Moloko,
MK Ndebele, LA Parker, FD Roman *Executive
Company Secretary: T Moodley
Website: http://www.brimstone.co.za
E-mail: info@brimstone.co.za
ABOUT THIS ANNOUNCEMENT
This short-form announcement is the responsibility of the directors of
Brimstone Investment Corporation Limited. It is only a summary of the
information in the reviewed provisional condensed consolidated year-end
results and does not contain full or complete details. Any investment
decisions by investors and/or shareholders should be based on consideration
of the reviewed provisional condensed consolidated financial results
for the year ended 31 December 2019 published on the JSE at
https://senspdf.jse.co.za/documents/2020/jse/isse/BRT/ye2019.pdf.
It is also available for viewing at http://www.brimstone.co.za/investor-relations
results-reports/. Copies of the reviewed provisional condensed consolidated
year-end results may be requested from the company secretary
(tmoodley@brimstone.co.za or tel +27 (0) 21 683 1444).
This announcement has not been audited or reviewed by the Group's external
auditors. The Group's auditors, Deloitte & Touche, have reviewed the full
announcement and issued an unmodified conclusion, which is available at
http://www.brimstone.co.za.
Date: 10-03-2020 05:46:00
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