Wrap Text
Unaudited Condensed Consolidated Interim Financial Results For The Six Months Ended 31 August 2021
CALGRO M3 HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2005/027663/06)
JSE Share code: CGR
ISIN: ZAE000109203
(“Calgro M3” or “the Company” or “the
Group”)
UNAUDITED CONDENSED CONSOLIDATED INTERIM FINANCIAL RESULTS FOR THE
SIX MONTHS ENDED 31 AUGUST 2021
1. SALIENT FEATURES
• Headline earnings per share increased by 262.8% to 42.79 cents per share (Aug
2020: 26.29 cents per share loss)
• Basic earnings per share (“EPS”) increased by 229.8% to 39.56 cents per share
(Aug 2020: 30.46 cents per share loss)
• Revenue increased by 45.6% to R576.2 million (Aug 2020: R395.8 million)
• Gross profit margin increased to 19.7% (Aug 2020: 7.9%)
• Net asset value per share increased by 6% to 722.94 cents per share (Feb 2021:
682.09 cents per share)
• Cash generated from operations amounted to R133.2 million
• Net debt to equity improved to 0.84:1.00
• Cash on hand of R215.0 million
• Strong balance sheet with liquidity of R615 million
• No dividend was declared for the period ended 31 August 2021 (Aug 2020: Nil)
In summary, the continued successful implementation of the strategic decisions that were
taken in prior periods to refocus, restructure and return the business to sustainable
profitability produced the desired results in the period under review.
Sustained increased sales efforts and increased focus on brand awareness across both
segments of the business, resulted in increased Revenue of 45.6% to R576.2 million, with
the Group’s Property Development business contributing R545.7 million (94.7% of total
revenue). When comparing the current period to the previous period, the improved
performance was a result of the aforementioned strategic execution in spite of the "post
Covid-19" base effect.
The gross margin reached a four-year high of 19.7%, justifying the strategic decision to
close and outsource the construction element of the business. Overhead costs decreased
by 23%, demonstrating the Group’s ability to manage costs and efficiencies in the current
economic environment. Memorial Parks also played its part and produced an increase of
52.7% in cash receipts, demonstrating a further increase in market share and stable
diversification in Group cash generation.
Continuous focus was placed on liquidity management resulting in strong cash generation,
allowing the Group to execute on its short to medium-term strategic goal of reducing debt,
which led to lower interest repayments and which further bolstered earnings. This, coupled
with the cash on hand of R215 million, resulted in a reduction in the Group’s net debt to
equity ratio to 0.84:1, which is ahead of the February 2022 target of 0.9:1.
The Group increased its efforts to minimise disruptions on projects, through engaging the
communities we service and developing good community and labour relations. This held
us in good stead during the recent civil unrest in South Africa where none of our units were
invaded or damaged.
Residential Property Development
The Residential Property Development business’ gross profit margin increased to 17.5%.
This is the highest margin achieved since 2017 and an indication of the Groups refocus to
its core business, which includes a move to outsourced construction. 5 091 opportunities
are currently under construction and this, together with meticulous capital allocation and a
lower overhead structure, has enabled this business to return to profitability.
The Group has sufficient serviced and un-serviced opportunities available across its
projects to fuel growth for the foreseeable future, without having to take excessive risks in
acquiring new projects.
The current low interest rate environment will further enhance housing sales. The Group
will remain cautious of the economic impact on the customer base and the potential tighter
credit criteria from banks.
Memorial Parks
The business continues to demonstrate substantial growth opportunities supported by an
increase in total cash receipts during the period of 52.7% to R39.4 million (Aug 2020:
R25.8 million).
A new entry level product was introduced at the Nasrec Memorial Park, offering a grave
for immediate burial for as low as R13,000. This diversification in the product offering has
attracted a new market that could previously not afford a grave at Nasrec Memorial Park,
and which has resulted in an increase in the Gauteng market share during the period. This
product is, however, not margin dilutive over the long term due to increased densities and
better operational efficiencies.
The Group is extremely excited to have concluded a partnership with Nedbank to offer a
loan facility to clients for the purchase of a grave. This service will be made available to
clients from 1 October 2021.
2. Short-form announcement
This short-form announcement is the responsibility of the directors of the Company. It
contains only a summary of the information in the full announcement ("Full
Announcement") and does not contain full or complete details. The Full Announcement
can be viewed at:
https://senspdf.jse.co.za/documents/2021/JSE/ISSE/CGRE/HY2022.pdf
Copies of the Full Announcement is also available for viewing on the Company's website
at www.calgrom3.com or may be requested in person, at the Company's registered office
or the office of the Sponsor, at no charge, during office hours.
Any investment decisions by investors and/or shareholders should be based on
consideration of the Full Announcement, as a whole.
These interim results have not been audited or reviewed by the Company's auditors,
PricewaterhouseCoopers Inc.
By order of the Board
Wikus Lategan Waldi Joubert
Chief Executive Officer Group Financial Director
Registered office
Calgro M3 Building
Ballywoods Office Park
33 Ballyclare Drive
Bryanston
2196
Private Bag X33, Craighall, 2024
Auditors
PricewaterhouseCoopers Inc.
Secretary
I April
Sponsor
PSG Capital
Transfer secretaries
Computershare Investor Services
Directors
WA Joubert Executive
WJ Lategan Executive
W Williams Executive
GS Hauptfleisch Independent Non-Executive
H Ntene Independent Non-Executive
LS Ntuli Independent Non-Executive
ME Gama Independent Non-Executive
RB Patmore Lead Independent Non-Executive
TC Moodley Non-Executive
TP Baloyi Independent Non-Executive
www.calgrom3.com
Johannesburg
18 October 2021
Sponsor
PSG Capital
Date: 18-10-2021 07:05:00
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