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AFRICAN EQUITY EMPOWERMENT INVESTMENTS LIMITED - Unaudited Condensed Consolidated Interim Results for the six months Ended 29 February 2020 and Dividend Declaration

Release Date: 18/06/2020 07:30
Code(s): AEE     PDF:  
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Unaudited Condensed Consolidated Interim Results for the six months Ended 29 February 2020 and Dividend Declaration

African Equity Empowerment Investments Limited
(Incorporated in the Republic of South Africa)
Registration number 1996/006093/06
Share code: AEE and ISIN: ZAE000195731
(“AEEI” or “the Group” or “the Company”)

SHORT FORM ANNOUNCEMENT – UNAUDITED CONDENSED CONSOLIDATED INTERIM
RESULTS FOR THE SIX MONTHS ENDED 29 FEBRUARY 2020 AND DIVIDEND
DECLARATION


 FINANCIAL SALIENT FEATURES

 -        Revenue increased by 111% from restated revenue of R766m to
          R1 614m
 -        Profit before tax increased to R139m from a restated loss of
          R593m
 -        Profit for the period is R118m as compared to the profit of
          R448m
 -        Earnings per share is 12.22c as compared to the prior
          restated earnings of 74.76c
 -        Headline earnings per share is 12.30c as compared to the
          prior restated headline earnings of 17.74c
 -        Total assets increased to R7 496m
 -        Net asset value per share increased to 1310.98c
 -        Net cash outflows from operating activities is R28m
 -        Gross interim dividend of 10.00c per share which has
          been declared to shareholders, a decrease of 9% from
          11,00c

GROUP PERFORMANCE

The Group delivered excellent revenue growth resulting from strong
contributions from the technology division for the interim period and group
revenue increased significantly by 111% from R766m to R1.6bn, mainly due to
acquisitive and organic growth in the technology division in the prior year.
The technology division’s revenue and operating expenses have been
consolidated for the full six-month period into the Group’s statement
of profit and loss and other comprehensive income whilst only two
months of trading was consolidated in the previous period.

Profit before taxation increased from a loss of R593m to a profit of R139m
due to an satisfactory operational performance of the underlying businesses
and investments.The Group’s profit for the period decreased from the restated
R448m to R118m, mainly due to an abnormal loss on deemed disposal of an
associate and the deferred tax effect thereon in the prior interim period.

Headline earnings per share (“HEPS”) is 12.30c as compared to the prior
restated headline earnings of 17.64c, a decrease of 30% from the restated
17.64c, while earnings per share (“EPS”) is 12.22c as compared to the prior
restated earnings of 74.76c, a decrease of 84% from the restated 74.76c for
the six months under review. The decrease in HEPS over the prior interim
period is an indication of the lower operational performance experienced in
the first six months.

The Group’s asset base remained stable at R7 496m despite the economic
volatility experienced impacted by COVID-19 with other financial assets
increasing by 35% from R583m at August 2019 to the current R788m. The net
asset value (“NAV”) amounted to R6 437m which is a performance indicator of
the Group’s strong balance sheet and resilient business model.

The net cash utilized from operating activities amounted to an outflow of
R28m due to lower operational performances from the fishing & brands
division, technology division and the general subdued performance from some
of our underlying businesses in the first half of the year. Despite the Group
having a net cash outflow in the interim period, the Group continues to have
strong cash balances with no significant external debt which is a major
advantage during the COVID-19 period.

RESTATEMENT OF PRIOR PERIOD INTERIM RESULTS

Shareholders are referred to the announcement released by AYO
Technology Solutions (“AYO”) on SENS on 8 April 2020 wherein AYO
advised its shareholders that as per the request by the JSE, AYO
obtained an audit opinion on its interim results for the six months
ended 28 February 2019. As a result of such audit being completed,
AYO further advised its shareholders that the previously unaudited
results for the six months ended 28 February 2019 were withdrawn and
replaced with the 2019 Audited Interim Results.

Shareholders are further referred to the announcement released by AYO
on SENS on 27 March 2020 wherein AYO advised its shareholders that as
per the request by the JSE, AYO obtained an audit opinion on its
interim results for the six months ended 28 February 2018.

Consequently, AEEI executive management had to review whether the
restatements per the AYO 2019 Audited Interim Results and AYO 2018
Audited Interim Results had an impact on the Group’s interims results.
Following such review, a retrospective restatement of AEEI’s interim
financial statements for the period ended 28 February 2019 and 28
February 2018 was required.

The above restatement had an effect on the reported earnings on the
statement of profit or loss and other comprehensive income, statement
of financial position and statement of cash flows. This impact will
be disclosed in detail in the long form full SENS interim unaudited
financial results for the period ending 29 February 2020.


DIVIDENDS

The Board of directors is pleased to announce that it has approved
and declared an interim dividend of 10.00 cents per share for the
six-month period ended 29 February 2020 from income reserves.
                                                          R’000
 Dividend declared after reporting date*                  R49 102
 Dividends per share (cents)                              10 cents
 *Dividends declared after the respective reporting period.

DECLARATION OF CASH DIVIDEND

Notice is hereby given that an interim gross dividend of 10 cents
per share has been declared out of income reserves in respect of
ordinary shares of no-par value for the period ended 29 February
2020.

A dividend withholding tax of 20% or        2 cents per share will be
applicable, resulting in a net dividend    of 8 cents per share, unless
the shareholder is exempt from paying      dividend withholding tax or
is entitled to a reduced rate in terms     of an applicable double-tax
agreement.

The number of ordinary shares in issue at declaration date is 491 022
434 and the income tax number of the Company is 9314001034.

The salient dates of this dividend distribution are:

Gross dividend (cents per share)                10.00
Dividend net of dividend withholding tax        8.00
Last day to trade cum dividend                  Tuesday, 7   July 2020
Trading ex-dividend commences                   Wednesday,   8 July 2020
Record date                                     Friday, 10   July 2020
Date of payment                                 Monday, 13   July 2020

Share certificates may not be dematerialised or rematerialized between
Wednesday, 8 July 2020 and Friday, 10 July 2020, both days inclusive.

STATEMENT OF COMPLIANCE AND BASIS OF PREPARATION

This short-form announcement contains only a summary of the
information in the full announcement and does not contain the full
and complete details and is the responsibility of the directors. Any
investment decision by investors and/or shareholders should be based
on consideration of the full announcement which has been released on
SENS        and        available        for        viewing        at
https://senspdf.jse.co.za/documents/2020/jse/isse/aee/INT2020.pdf or on
the Company’s website at http://aeei.co.za/sens-announcement.

Copies of the full announcement in respect of the unaudited 2020
Interim Results may also be requested via email from the Company
Secretary at damien@aeei.co.za or by sending an email to the Sponsor
on sponsor@vunanicapital.co.za. There will be no charge for the email
and any emails will be responded to during office hours. Given the
lock-down these will be sent electronically upon request.
APPRECIATION

We wish to thank our employees, Group executives, management, our
Board of directors as well as our strategic partners, stakeholders
and business partners for their loyalty and dedication in contributing
to the success of the Group.


Mrs Aziza Amod                   Mrs Valentine Dzvova
Non - executive chairperson      Acting - chief executive officer

Cape Town
17 June 2020

Directors
*Valentine Dzvova (acting chief executive officer); Aziza Amod (non-
executive Chairman); *Chantelle Ah Sing; Ismet Amod; Gaamiem Colbie
and Jowayne van Wyk
*Executive directors


Company secretary:    Damien Terblanche
Registered address:   1st Floor, Waterway House North, 3 Dock Road,
                      Victoria and Alfred Waterfront, Cape Town
                      8001,
Email:                damien@aeei.co.za

                      Transfer secretaries: Link Market Services
                      South Africa Proprietary Limited 19 Ameshoff
                      Street,13th Floor, Rennie House, Braamfontein,
                      Johannesburg 2001

Auditors:             Crowe JHB
                      3 Sandown Valley Crescent, Sandown,
                      Johannesburg, 2196

                       Thawt Inc.
                        3 Monte Vista Blvd, Monte Vista, Cape Town,
            7460

Sponsor:              Vunani Capital Proprietary Limited
                      Vunani House, Vunani Office Park, 151
                      Katherine Street, Sandown, Johannesburg, 2196

Date: 18-06-2020 07:30:00
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