7/27/2019 RADR Audited results for FY ended 30 Jun 13.pdf

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Audited Financial Results For The Year

Ended 30 June 2013

Radar Holdings Limited

TO BE THE BEST

RADAR

Directors: HBAJ von Pezold (Chairman), E Hwenga (C.E.O), RE Breschini*, MS Mattinson*, BD Mtetwa, E Mlambo*, KRR Schofeld, H Mapara , Z Kumwenda

GROUP STATEMENT OF COMPREHENSIVE INCOMEFor the year ended 30 June 2013

12 Months 12 Months30-Jun-13 30-Jun-12

US$ US$

Continuing OperationsRevenue 9 229 511 8 295 914Cost o sales (6 409 460 ) (5 888 654 )Gross prot 2 820 051 2 407 260

Other operating income 74 613 325 869Fair value loss on investment property (600 000 ) (200 000 )Depreciation (789 248 ) (828 319 )Other operating expenses (2 562 545 ) (1 190 810 )Operating (loss)/prot (1 057 129 ) 514 000

Net nance costs (937 592 ) (764 669 )Loss beore tax (1 994 721 ) (250 669)

Income tax (expense)/credit (295 224 ) 986 757

(Loss)/prot or the year rom continuing operations (2 289 945 ) 736 088

Discontinued operations

(Loss)/prot or the period rom discontinued operations (46 951 358 ) 574 081

(Loss)/prot or the year (49 241 303 ) 1 310 169

Attributable to:Equity holders o parent company (49 898 210 ) 418 605Non-controlling interest 656 907 891 564 (49 241 303 ) 1 310 169(Loss)/prot or the year (49 241 303 ) 1 310 169

Other comprehensive income:Items that will not be reclassifed to proft or loss: Revaluation o property, plant and equipment 3 906 320 -Tax on revaluation o property, plant and equipment (200 609 ) (291 170 )

3 705 711 (291 170 )Items that may be reclassifed subsequently to proft or loss:Net air value gain/(loss) on available or sale nancial assets 53 385 (62 622 )Tax on air value gain or loss on available or sale nancial assets (2 669 ) 3 131

50 716 (59 491 )

Total other comprehensive income/(loss) or the year, net o tax 3 756 427 (350 661 )

Total comprehensive (loss)/income or the year (45 484 876 ) 959 508

Attributable to:Equity holders o parent company (46 141 783 ) 56 170Non-controlling interest 656 907 903 338

(45 484 876 ) 959 508Total comprehensive (loss)/income attributable to equity shareholders arises rom: Continuing operations 1 466 481 385 427Discontinued operations (47 608 265 ) (329 257 )

(46 141 784 ) 56 170Key StatisticsShares in issue 51 085 875 51 085 875Earnings/(loss) per share (cents)- Basic and diluted rom continuing operations per share (cents) (4.48 ) 1.44- Basic and diluted rom discontinued operations per share (cents) (93.19 ) (0.62 )- (Loss)/earnings per share or the year (cents) (97.67 ) 0.82

- Headline (loss)/earnings per share or the year (cents) (93.71 ) 0.75

GROUP STATEMENT OF FINANCIAL POSITION

as at 30 June 2013 30-Jun-13 30-Jun-12

US$ US$

ASSETS

Non current assetProperty plant and equipment 15 306 736 59 964 729Biological assets - 97 794 631Investment property 3 200 000 3 800 000Available-or-sale investments 101 146 47,761Trade and other receivables 137 315 1 000 000Total non-current assets 18 745 197 162 607 121Current assetsInventories 1 877 757 5 762 491Trade and other receivables 682 827 6 022 462Cash and cash equivalents 232 803 584 796Total current assets 2 793 387 12 369 749

TOTAL ASSETS 21 538 584 174 976 870

EQUITY AND LIABILITIESShare capital 510 859 510 859Other reserves 10 900 255 59 629 643Retained earnings 1 345 927 4 626 156

12 757 041 64 766 658

Non-controlling interest - 52 101 563Total equity 12 757 041 116 868 221

Non current liabilitiesBorrowings - 1 405 370Deerred tax liability 1 749 863 33 670 859Total non current liabilities 1 749 863 35 076 229

Current LiabilitiesTrade and other payables 490 417 5 310 853Borrowings 6 541 263 17 721 567Total current liabilities 7 031 680 23 032 420

TOTAL EQUITY AND LIABILITIES 21 538 584 174 976 870

CONSOLIDATED STATEMENT OF CASH FLOWSor the year ended 30 June 2013

12 Months 12 Months30-Jun-13 30-Jun-12

US$ US$

Cash fows rom operating activities

Operating prot or the year including discontinued operation 3 836 114 4 343 093

Adjusted or:

Depreciation 2 792 826 2 949 442

Fair value gain on biological assets (8 592 455 ) (10 070 422)

Fair value loss on investment property 600 000 200 000

Impairment loss 1 264 329 8 844

Plantation destroyed by re 177 776 2 738 014

Loss on disposal o property, plant and equipment 3 719 262 140

Changes in working capital:

Inventory 2 787 545 4 861 388

Trade and other receivables 2 147 504 (1 397 141 )

Trade and other payables 707 444 (381 055 )

Cash generated rom operating activities 5 724 802 3 514 303

Taxation paid (36 923) (49 025 )

Net cash generated rom operating activities 5 687 879 3 465 278

Cash fows rom investing activities

Purchase o property, plant and equipment (1 266 873 ) (3 762 976 )

Expenditure on biological assets (3 141 994 ) (4 099 352 )

Proceeds on disposal o property, plant and equipment 228 720 701 961

Distribution o subsidiary 2 654 176 (66 853 )

Net cash utilised in investing activities (1 525 971 ) (7 227 220 )

Cash fows rom nancing activities

Net proceeds rom borrowings (738 527 ) 7 220 833

Interest paid (3 408 340 ) (3 067 694 )

Net cash (utilised in)/generated rom nancing activities (4 146 867 ) 4 153 139

Net increase in cash and cash equivalents 15 041 391 197

Cash and cash equivalents at beginning o year (3 112 034 ) (3 503 231)

Cash and cash equivalents at end o year (3 096 993 ) (3 112 034)

GROUP STATEMENT OF C HANGES IN EQUITY

For the year ended 30 June 2013

Attributable to equity holders o the parent

Total Non

Share Other Retaine d shareholder controlli ng Total

capital reserves earnings equity interest equity

US$ US$ US$ US$ US$ US$

Balance as at 30 June 2011 510 859 60 231 344 3 968 285 64 710 488 51 198 225 115 908 713

Comprehensive income:

Prot or the year - - 418 605 418 605 891 564 1 310 169

Other comprehensive income:

Realisation o revaluation surplus

on disposa l - (239 266) 239 266 - - -

Deerred tax charge to

revaluation surplus - (302 944) - (302 944) 11 774 (291 170)

Fair value loss on available

-or-sal e nancia l assets - (59 491) - (59 491) - ( 59 491)

Balance at 30 June 2012 510 859 59 629 643 4 626 156 64 766 658 52 101 563 116 868 221

Comprehensive income:

Loss or the year - - (49 898 210) (49 898 210) 656 907 (49 241 303)

Other comprehensive income:

Surplus on revaluation o property,

plant and equipmen t - 3 705 711 - 3 705 711 - 3 705 711

Fair value loss on available

-or-sal e nancia l assets - 50 716 - 50 716 - 50 716

Transactions with owners:

Transer to retained earnings

on disposa l o subsidi ary - (46 906 490) 46 906 490 - (52 758 470) (52 758 470)

Dividen d distrib uted - - (6 601 526) (6 601 526) - (6 601 526)

Deerred tax release - 733 692 - 733 692 - 733 692

Transer o non distributable reserves - (6 313 017) 6 313 017 - - -

Balance as at 30 June 2013 510 859 10 900 255 1 345 927 12 757 041 - 12 757 041

7/27/2019 RADR Audited results for FY ended 30 Jun 13.pdf

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Audited Financial Results For The Year

Ended 30 June 2013

Radar Holdings Limited

TO BE THE BEST

RADAR

Directors: HBAJ von Pezold (Chairman), E Hwenga (C.E.O), RE Breschini*, MS Mattinson*, BD Mtetwa, E Mlambo*, KRR Schofeld, H Mapara , Z Kumwenda

NOTES TO THE GROUP FINANCIAL RESULTSor the year ended 30 June 2013

1. Accounting policies

The principal accounting policies o the Group have been ollowed in all material respects and conorm toInternational Financial Reporting Standards (IFRS) and the Zimbabwe Companies Act (Chapter 24:03). The sameaccounting policies and methods o computation are ollowed as compared with those in the prior nancial yearThis publication should be read in conjunction with the annual nancial statements or the year ended 30 June2013, which have been prepared in accordance with IFRSs and Zimbabwe Companies Act (Chapter 24:03).

International Accounting Standard 16 Property, Plant and Equipment requires that revaluations o property plantand equipment be undertaken on a regular basis. A proessional revaluation was conducted as a t 30 June 2013 andthe next revaluation will be as at 30 June 2016. International Accounting Standard 41 Agriculture requires that theGroup value its Biological Assets at air value.

The nancial results are presented in United States Dollars which is the unctional and presentation currency o theGroup.

2. Audit reportThe Auditors, Messrs PricewaterhouseCoopers, have indicated that the audit report on the nancial statements orthe Group or the year ended 30 June 2013 will be unqualied.

2013 2012US$ US$

3. Related party transactions

(i) Transactions-sales o goods and services 291 627 1 735 140

-purchases o goods and services 693 197 494 910

-impairment o receivables 1 833 906 -

(ii) Year-end balances-receivable rom related parties 95 155 1 218 875

-payable to related parties (26 541 ) (247 989 )

(v) Key management remuneration 342 592 542 735

4. Property, plant and equipment

Capital expenditure (1 354 104 ) (3 762 976 )

Depreciation (789 248 ) (828 319 )

5 Segment inormation

Forestr y Manuacturing Servi ces Eliminations TotalUS$ US$ US$ US$ US$

Revenue:Local 10 375 769 17 405 044 1 303 348 (19 854 650 ) 9 229 511Total 10 375 769 17 405 044 1 303 348 (19 854 650 ) 9 229 511

Prot/(loss) beore interest and taxation 8 359 411 1 730 571 (2 333 648 ) (8 813 464 ) (1 057 129 )Net interest expense (2 068 514 ) (576 622 ) (894 129 ) 2 601 673 (937 592 )Income tax expense (622 323 ) - (295 224 ) 622 323 (295 224 )Loss rom discontinued operations - - - (46 951 358 ) (46 951 358 )Net prot/(loss) 5 668 574 1 153 949 (3 523 001) (25 540 826 ) (49 241 303 )

Total assets - 6 925 044 14 613 540 - 21 538 584

Total liabilities - 2 381 515 7 119 663 (719 635 ) 8 781 543

6 Disposal o subsidiaryRadar Holdings Limited owned 22 005 087 shares in Border Timbers Limited representing 51,24% up to 31 May2013. The Board decided to distribute its shares in Border Timbers Limited to shareholders through a dividend inspecie.

In light o the competitive dollarised environment, the Board deems the demerger o Border Timbers Limited romRadar Holdings Limited as a necessary event given the diering nancial needs and sectorial ocuses o eachbusiness. In the Boards opinion, the demerger o Border Timbers Limited will position Radar Holdings Limited asa purely construction group. This will allow Radar Holdings Limited to build on the already positive perormanceachieved by the company in the construction sector.

The demerger o Border Timbers Limited will allow or clear operational ocus which is both attractive to investorsand positions Radar Holdings Limited to pursue its own independent direction. The strong stand alone Group willhave a better ability to execute growth strategies designed to capitalise on the expected growth in constructionand drive shareholder value.

On 31 October 2011, one o the Radar Holdings Limiteds wholly owned subsidiaries Radar Investments (P riv at e)Limited disposed its construction and building materials trading division, United Builders Merchants (UBM).

2013 2012US$ US$

Revenue 22 160 032 30 530 344Cost o Sales (21 598 578 ) (29 035 828 )

Gross prot 561 454 1 494 516Other operating income/(expenses) - net 444 274 (228 761 )Fair value gain/(loss) - biological assets 8 592 455 10 070 422Distribution and selling expenses (2 132 057 ) (2 649 429 )Administration expenses (2 572 882 ) (4 857 655 )

4 893 244 3 829 093

Net nance costs (2 470 748 ) (2 382 739 )

Prot beore tax 2 422 496 1 446 354

Income tax charge (622 323 ) (906 387 )Prot or the year rom discontinued operations 1 800 173 539 967(Loss)/prot on disposal o discontinued operations (48 751 531 ) 34 114

(46 951 358 ) 574 081

COMMENTARY

BACKGROUNDFollowing the demerger o Border Timbers Limited on 31 May 2013 the group continuing operations now comprise o Macdonald Bricks,Radar Properties (Private) Limited and Radar Investments (Private) Limited. The demerger allows Radar Holdings Limited to build on thealready positive perormance achieved by the Group in the construction sector.

Macdonald Bricks is a brick manuacturer in Bulawayo with two brick elds namely Montgomery works and Willsgrove works. This isa Radar Investments operating division. Radar Investments is the corporate services unit within the group and Radar Properties is aproperty company that owns commercial, residential and industrial properties and a small urban land bank in Bulawayo.

GROUP OPERATIONAL AND FINANCIAL REVIEWThe Groups turnover increased by 11%, rom US$8,295,914 in FY12 to US$9,229,511 in FY13, a commendable perormance given theprevailing economic environment. Ater tax protability rom continuing operations decreased rom US$736 088 in FY12 to a loss oUS$2 289 946 in FY13. This was due to a 23% increase in net nance charges to US$937 592 and impairing o intergroup receivablesamounting to US$1 833 906. In summary the Groups operational eciency has been adversely aected by high production costs due toerratic power supplies, increasing repairs and maintenance costs on old mobile machinery and relatively high input costs (raw materials,labour, transportation).

The absence o suitably priced local debt nance and the limited availability o long term debt nance have inhibited the Groups abilityto use debt nance to boost its operations and grow its asset base. The Group borrowings rom continuing operations decreased by10% to US$6,541,263, but this remains short term and aects current asset ratios. Management has engaged various local and regionalnanciers in an attempt to access cheaper long term debt nance. Negotiations with the potential nanciers are at various stages andmanagement is condent that a signicant portion o the existing debt will be restructured and/or renanced resulting in better solvencyratios going orward. Eorts are also in place to dispose o some excess assets in the Group to repay some o the short term debt.

MACDONALD BRICKSThe units turnover increased by 11% to US$9 128 384 compared to the previous year. The recorded increase was mainly attributable to acombination o an increase in sales volume as well as a better product mix. Sales volumes increased by 12% compared to prior year. Thiswas driven by an increase in construction activity particularly in the rst hal o the year. Demand however slowed down in the last halo the year as some projects that were being supplied ran out o unding.

The division posted a net income o US$1 687 107 compared to US$481 797 in the previous nancial year.

A total o US$490 206 was spent on capital expenditure during the year to replace old earth moving equipment that was proving to bevery expensive to run and maintain.

The power line project that experienced delays in the previous nancial year was nally completed and commissioned in January 2013.This ensured an uninterrupted power supply to Willsgrove plant in the last hal o the year and should see an improvement in productiongoing orward.

Construction o a coal storage/ washing bay was completed at Montgomery along with modications to ring boxes on kilns. This hasseen an improvement in smoke emissions rom the plant. Management continues to eect improvements and aims to ully comply withEMA requirements. Rehabilitation o the quarry areas is on -going at both mining sites as is water conservation at the Willsgrove dam toensure sustainable brick production.

RADAR PROPERTIESRadar Properties is one o the companies that would benet i the liquidity and economic environment improves. As such, managementhas taken a decision to position the company into property development sector, taking advantage o its existing urban land bank. Whilethe country still experiences a huge housing backlog, there is an opportunity to tap into this inrastructural development.

During the year, rental income declined 14% rom US$155 911 to US$134 405. The operating environment is characterized by belowmarket rentals and high deault rate by tenants. Occupancy ratio dropped rom 62% in FY12 to 58%.The ocus continues to be onattracting high quality tenants against volume tenants.

DISCONTINUED OPERATIONSThe loss rom discontinued operations o US$46 951 358 represents the transer o the value o Border Timbers Limited rom the holdingcompany to individual shareholders. At Radar Holdings Limited consolidation level, Border Timbers Limited was accounted or at netasset value whilst the distribution in specie was accounted or at the market value o Border Timbers Limited shares. The loss is signicantdue to the disparity between the price o the ZSE quoted shares as compared to the net asset value o the subsidiary disposed. None othe shareholders o the Group suered any loss as a result o the transaction as they continue to own the same assets in the two Groups.

DIVIDENDDue to the ongoing retooling exercise and the need to bring down debt, the Board does not recommend any dividend.

OUTLOOKThe demand or the Groups products is expected to remain strong mainly driven by the construction industry. Most o the Groupsproducts have been consumed by the residential development sector and it is expected that this trend will continue as a result o thestrong demand or individual urban housing. Within Zimbabwe, Macdonald Bricks products are used in a wide variety o structuresranging rom low cost housing to high rise buildings.

In order to ully benet rom the anticipated increased demand, the Group intends to increase operational capacity by investing i n capitalequipment.

The Group expects to benet rom increased volumes as a result o the newly installed dedicated powerline which will be in use or the

ull year. The new leaner head oce structure will result i n savings o US$480 000.

DIRECTORATEMessrs H. Mapara and Z. Kumwenda were appointed to the board on 26 June 2013. Their diverse experience will be o enormous benetto the Board. Messrs E. Mlambo, S. Mattinson, RE. Breschini resigned on 26 June 2013. We thank them or their contribution to the Boardover the years.

ACKNOWLEDGEMENTThe Group greatly appreciates the support it has received rom management and all sta.

By order o the BoardRadar Investments (Private) LimitedSecretariesHARARE

20 September 2013

Appointed - 26 June 2013

* Resigned - 26 June 2013

31-May-13 31-Oct-11US$ US$

Border Timbers UBM

AssetsProperty, plant and equipment 46 630 900 604 548Biological asset 104 527 043 -Inventories 5 830 894 1 118 922Trade and other receivables 3 433 986 200 075

Cash 568 798 66 854160 991 621 1 990 399

Liabilities

Other liabilities 49 657 118 2 024 512Short term borrowings and bank overdrats 3 222 974 -Net assets/(liabilities) directly associated with disposal group 108 111 529 (34 113 )

Non controlling Interest (52 758 470 ) -(Loss)/prot on disposal (48 751 531 ) 34 114Total disposal consideration 6 601 528 1Consideration received in the orm o dividend in specie (6 601 528 ) -Consideration received in cash - 1Less cash and cash equivalents o subsidiary/division (2 654 176 ) 66 854Net cash infow/(outfow) 2 654 176 (66 853)

6.1 Discontinued operations

As disclosed below, discontinued operations recorded a loss o US$46 951 989 (2012: prot US$574 081) which hasbeen included in the Group statement o comprehensive income as (loss)/prot rom discontinued operations. The

analysis o the years results are shown below: