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Interim results
Nu-World Holdings Limited
(Registration number 1968/002490/06)
(Incorporated in the Republic of South Africa)
JSE share code: NWL ISIN code: ZAE000005070
(“Nu-World” or “the Group” or “the Company”)
UNAUDITED CONDENSED CONSOLIDATED INTERIM RESULTS OF NU-WORLD FOR THE SIX
MONTHS ENDED 28 FEBRUARY 2018 (“INTERIM RESULTS”)
GROUP REVENUE R1 683,0 MILLION
+ 8.6%
NET PROFIT ATTRIBUTABLE TO ORDINARY
SHAREHOLDERS R85,1 MILLION
+ 16.3%
COMPREHENSIVE INCOME ATTRIBUTABLE TO EQUITY
HOLDERS OF COMPANY R75,9 MILLION
+ 33,0%
HEADLINE EARNINGS PER SHARE 399,1 CENTS
+ 15.8%
NET ASSET VALUE PER SHARE 4 724,0 CENTS
+ 8,3%
GROUP CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
28 February 28 February 31 August
2018 2017 % 2017
R'000 R'000 change R'000
Revenue 1 683 002 1 549 494 8,6% 2 948 025
Net operating income 129 837 115 693 242 318
Depreciation 1 362 1 379 4 884
Interest paid 14 591 10 494 18 235
Income before taxation 113 884 103 820 219 199
Taxation 27 784 26 622 48 702
Income after taxation 86 100 77 198 11,5% 170 497
Share of associate company profit 91 201 82
Net profit for the period/year 86 191 77 399 170 579
Net profit attributable to:
Non-controlling interest 1 030 4 167 4 887
Equity holders of the company 85 161 73 232 16,3% 165 692
86 191 77 399 170 579
Other comprehensive income:
Exchange differences on translating
foreign operations (10 242) (17 450) (19 659)
Total comprehensive income for the
period/year 75 949 59 949 150 920
Total comprehensive income
attributable to:
Non-controlling interest (879) 2 838 3 876
Equity holders of the company 75 949 57 111 147 044
76 828 59 949 150 920
Headline earnings reconciliation:
Determination of comprehensive
income and headline earnings
Net profit attributable to ordinary
shareholders 85 161 73 232 165 692
Add IAS16 loss on disposal of fixed
assets 0 87 227
Total tax effects of adjustments 0 (24) (63)
Headline earnings 85 161 73 295 16,2% 165 856
SUPPLEMENTARY INFORMATION
Dividend paid (cents) 292,7
Comprehensive income 85 161 73 232 16,3% 165 692
Headline earnings 85 161 73 295 16,2% 165 856
Basic earnings per share (cents) 399,1 344,4 15,9% 779,2
Headline earnings per share (cents) 399,1 344,7 15,8% 780,0
Diluted earnings per share (cents) 388,5 326,7 18,9% 755,9
Dividend per share (cents) 292,7
Dividend cover (times) 2,5
Shares in issue (total issued) 22 646 465 22 646 465 22 646 465
Shares in issue (less treasury shares) 21 340 947 21 259 300 21 340 947
Shares in issue – weighted 21 340 947 21 263 754 21 263 167
Shares in issue – diluted 21 920 947 22 449 300 21 920 947
Capital distribution 66 286
Operating income as a percentage of
turnover 7,7% 7,5% 8,2%
Net asset value per share (cents) 4 724,0 4 363,5 8,3% 4 674,6
Intangible assets
Goodwill and amortisation
Balance at beginning of period/year 31 522 32 758 32 758
Translation difference (1 920) (1 661) (1 236)
Balance at end of period/year 29 602 31 097 31 522
Patent and trademark:
Balance at beginning of period/year 31 706 31 706 31 706
Balance at end of period 31 706 31 706 31 706
Total intangible assets 61 308 62 803 63 228
SEGMENTAL INFORMATION
Geographical revenue
South Africa 1 288 208 1 109 761 2 024 484
Offshore subsidiaries 394 794 439 733 923 541
1 683 002 1 549 494 8,6% 2 948 025
Geographical income
South Africa 54 867 43 066 90 063
Offshore subsidiaries 30 294 30 166 75 629
85 161 73 232 16,3% 165 692
GROUP CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
28 February 28 February 31 August
2018 2017 2017
R'000 R'000 R'000
ASSETS
Non-current assets
Fixed assets 23 489 25 828 23 188
Intangible assets 61 308 62 803 63 228
Investment in associate 358 386 267
Deferred taxation 17 660 18 225 18 369
Current assets
Inventory 553 991 548 318 467 776
Stock in transit 182 228 90 969 198 402
Trade and other receivables 544 229 350 060 504 669
Cash equivalents 236 951 242 824 114 279
Total assets 1 620 214 1 339 413 1 390 178
Equity and liabilities
Ordinary shareholders' funds 1 008 148 927 656 997 606
Minority interests 12 168 15 602 16 640
Total shareholders' funds 1 020 316 943 258 1 014 246
Current liabilities
Bank borrowings 364 811 182 544 59 263
Trade and other payables 235 087 213 611 316 669
Total equity and liabilities 1 620 214 1 339 413 1 390 178
GROUP CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
28 February 28 February 31 August
2018 2017 2017
R'000 R'000 R'000
Balance as at 1 September 997 606 911 711 911 711
Total attributable income for the
period/year 85 161 73 232 165 692
Dividend paid (66 286) (40 854) (40 854)
Movement in foreign currency
translation reserve (8 333) (16 121) (18 648)
Treasury share movement 0 (312) (6 375)
Issue of share-based payment awards 0 0 (13 920)
Balance at end of period/year 1 008 148 927 656 997 606
GROUP CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Unaudited Audited
6 Months 6 Months 12 Months
28 February 28 February 31 August
2018 2017 2017
R'000 R'000 R'000
Cash (utilized by)/generated from
operating activities (168 952) 69 117 74 264
Cash (utilized by)/generated from
operations (61 776) 146 646 176 527
Investment income 317
Interest paid (14 591) (10 493) (18 235)
Dividends paid (66 286) (40 854) (40 854)
Taxation paid (26 299) (26 182) (43 491)
Cash flows from investing activities (5 256) (2 398) (9 537)
Purchase of tangible fixed assets (1 663) (2 087) (3 651)
Investment in subsidiary (3 593) 80
Proceeds on disposal of fixed assets 409
Investment in treasury
Shares (311) (6 375)
Net (decrease)/increase in cash and
cash equivalents (174 208) 66 719 64 727
Effects of exchange rate changes on
the balance of cash held in foreign
currencies (8 668) (15 823) (19 095)
Cash and cash equivalents at the
beginning of the period/year 55 016 9 384 9 384
Cash and cash equivalents at the end
of the period/year (127 860) 60 280 55 016
COMMENTARY
Corporate information
Nu-World is a limited liability company incorporated and domiciled in South Africa with subsidiaries in
Australia, Brazil, Dubai, Hong Kong and Lesotho. The main business of Nu-World and its subsidiaries,
includes the importing, manufacturing, assembling, marketing and distribution of branded consumer
goods including consumer electronics, hi-tech, small electrical appliances, white goods, liquor and
furniture.
Basis of preparation
These Interim Results have been prepared in accordance with the framework concepts and the
measurement and recognition requirements of International Financial Reporting Standards (IFRS), the
SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, the Companies
Act, No 71 of 2008 (as amended) and comply with the disclosure requirements of IAS 34: Interim
Financial Reporting.
The Interim Results have been prepared under the historical cost convention.
The accounting policies used in the preparation of these Interim Results are in accordance with IFRS
and consistent in all material respects with those used in the audited annual financial statements for the
year ended 31 August 2017.
The Interim Results are presented in Rand rounded to the nearest thousand („000).
The condensed consolidated statement of financial position at 28 February 2018 and the related
condensed consolidated statements of comprehensive income, statement of changes in equity and
cash flows for the six months then ended, have not been reviewed or reported on by the Group?s
auditors.
The Interim Results have been prepared under the supervision of Graham Hindle CA (SA) in his
capacity as Financial Director.
Operating results
The Group produced satisfactory results for the period ended 28 February 2018. Accordingly, the
directors are pleased to report on top-line growth of 8,6% and positive earnings growth attributable to
equity holders of the Company of 16,3%.
South Africa
The South African operations showed strong positive growth in both sales and profitability. Sales growth
was achieved across most divisions.
Consumer electronics –
Additional models, categories and brands were added during the period under review which assisted in
contributing to increased sales. The Company also increased stock holding to assist customers with in-
stock positions of fast moving lines.
Liquor division –
Liquor sales continue to grow as additional brands and catagories are added to the product offering –
additional single malt whiskies as well as a range of flavoured vodka's have been introduced.
Small domestic appliances / white goods –
The Company continues to introduce new product designs and concepts.
General –
To ensure that our customers and consumers are afforded the latest designs at affordable prices, the
Group continues to invest in the development of new models and designs.
Offshore operations
Australia
During the current period under review, the trading results of the Australian operations came under
pressure due to the subdued Australasian economy. Our distribution network is being expanded to
include e-commerce options as well as other traditional customers.
Africa / Middle East / CIS / Brazil
The Company managed to show growth in these markets, assisted by these local currencies
strengthening against the United States Dollar. Uruguay continues to be a strong presence in Latin
America.
Sub-continent (India/Pakistan/Sri Lanka)
The distribution network is increasing and additional stocks are being ordered for these regions.
FINANCIAL OVERVIEW
STATEMENT OF COMPREHENSIVE INCOME
Group revenue increased by 8,6% to R 1 683,0 million (February 2017 – R 1 549,5 million).
Income after taxation increased by 11,5% to R 86,1 million (February 2017 – R 77,2 million).
Total headline earnings per share for the period increased by 15,8% to 399,1 cents (February 2017 –
344,7 cents).
STATEMENT OF FINANCIAL POSITION
The balance sheet remains strong but with higher borrowings.
Inventory levels of R 554,0 million increased by 1,0% from February 2017 (R 548,3 million). Directors
and management remain focused on improving working capital management and stock turn rates.
The increase in trade and other receivable of 55,5% to R 544,2 million (February 2017 – R 350,0
million) arose due to the strong late sales in both local and offshore operations at the end of the period
under review.
Trade and other payables increased by 10,0% to R 235,1 million (February 2017 – R 213,6 million) due
to the higher levels of stock in transit at the end of the period under review.
Net asset value per share has increased by 8,3% to 4 724,0 cents (February 2017 – 4 363,5 cents).
SUBSEQUENT EVENTS
th
On 27 March 2018, the South African Revenue Service (SARS) issued revised assessments for a
subsidiary of Nu-World Holdings Limited, relating to the 2008 to 2012 tax years for a taxation amount of
R7,6 million and interest and penalties of R18,8 million. Nu-World and their tax advisors have opposed
these revised assessments. No other events material to the understanding of the report have occurred
during the period between 28 February 2018 and the date of this report.
On behalf of the board of directors
J.A. Goldberg
Chief Executive Officer
G.R. Hindle
Financial Director
24 April 2018
Registered office
35 3rd Street, Wynberg, Sandton 2199
Republic of South Africa
Tel +27 (11) 321 2111
Fax +27 (11) 440 9920
Transfer secretaries
Computershare Investor Services (Pty) Ltd
Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196
Company secretary
B.H. Haikney
Auditors
RSM South Africa
Sponsor
Sasfin Capital, (a member of the Sasfin group)
Directors
M.S. Goldberg (Executive Chairman)
J.A. Goldberg (Chief Executive Officer)
G.R. Hindle (Chief Financial Officer)
Non-executive directors
J.M. Judin (Lead), D. Piaray, R. Kinross, F.J. Davidson
www.nuworld.co.za
Johannesburg
24 April 2018
Date: 24/04/2018 05:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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