| The Group’s operating model produced good results |
|
| |
|
 |
The group’s operating model, characterised by
selective participation in geographical areas,
currencies, funding structures, supply chain
participation and investments in the household
goods and automotive markets, again produced
good results.
| • |
25% increase in headline earnings per share |
| • |
13% increase in revenue from
continuing operations |
| • |
33% five-year compound growth rate
in EBITDA |
|
CHIEF FINANCIAL OFFICER | Jan van der Merwe
FINANCIAL DIRECTOR | Frikkie Nel |
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| |
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| Introduction |
|
The group continues to comply with
International Financial Reporting Standards
(IFRS) including the interpretations issued by
the International Financial Reporting
Interpretations Committee (IFRIC), the listing
requirements of the JSE Limited (JSE) and in
all material respects with the code of
corporate practice and conduct published in
the King II report on corporate governance.
As accounting standards become more
technical and complex, we have focused on
additional disclosure and clearer explanations
to aid the reader’s understanding of the
group’s financial performance. Accordingly,
the group has early adopted both IFRS 8 –
Operating Segments and IFRIC 11 – IFRS 2
Share-based payment – Group and Treasury
Share Transactions. The group’s accounting
policies have been applied consistently to
the periods presented in the consolidated
financial statements, with the only changes
being the early adoption of IFRS 8 and
IFRIC 11 and a change in accounting polices
for Common control transactions – premiums
and discounts arising on subsequent
purchases from or sales to minority interest
in subsidiaries.
This review aims to provide a clearer view of
the group’s performance for the year ended
30 June 2007. The review is not
comprehensive and should be read in
conjunction with the annual financial
statements on pages 84 to 221, and the
chairman and chief executive’s statements
on pages 10 to 17. |
|
| |
|
| Performance |
|
The group’s operating model characterised
by selective participation in geographical
areas, currencies, funding structures, supply
chain participation and investments in the
household goods and automotive markets
again produced good results.
We are pleased with the 25% increase in
headline earnings per share, bringing the
five-year compound growth rate to 18%.
Revenue from continuing operations
increased by 13% to R34,2 billion, resulting
in a five-year compound growth rate of
33%, and the five-year compound EBITDA
growth rate is 33%. Operating margins
increased year-on-year to 9,4% (2006:
8,6%). |
|
| |
|
| Performance |
| |
2007
R’m |
2006
R’m |
| Continuing operations |
|
|
| Turnover |
34 229 |
30 159 |
| Operating profit |
2 978 |
2 505 |
| Operating profit margin |
8,70% |
8,31% |
| Profit from continuing operations |
2 290 |
1 908 |
| Earnings per share from continuing operations (cents) |
184,3 |
156,3 |
| Discontinued operations |
|
|
| Profit from discontinued operations |
143 |
105 |
| Profit on disposal |
542 |
— |
| Profit per share from discontinued operations (cents) |
57,6 |
9,3 |
| Overall performance |
|
|
| Profit attributable to shareholders |
2 970 |
1 949 |
| Earnings per share (cents) |
241,9 |
165,6 |
|
|
| |
|
On 29 June 2007 the Competition Commission
approved and recommended the
unconditional approval by the Competition
Tribunal (who approved on 1 August 2007)
of the disposal by Steinhoff of its Southern
African furniture manufacturing interests
(Bravo Group) to a private equity consortium
led by Absa Capital, a division of Absa Bank
Limited, and Bravo Group management for
R1 375 million. The consideration received in
respect of this disposal was received and
accounted for at 30 June 2007.
In compliance with IFRS 5: Non-current
Assets Held for Sale and Discontinued
Operations, the results of the Bravo Group
are presented separately from continuing
operations on the face of the income
statement, and the comparative period is
represented without the discontinued
operations. Except where otherwise indicated,
this report focuses on continuing operations. |
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| |
|
| The group’s revenues from
continuing operations grew
from R30,2 billion to
R34,2 billion. |
|
| |
|
| REVENUE per Geographical area: 2007 |
REVENUE per Activity: 2007 |
|
| |
|
|
 |
 |
|
| |
|
| Summary of results |
| |
2007
R’m |
%
change |
2006
R’m |
| Revenue |
34 229 |
13 |
30 159 |
| Operating profit |
2 978 |
19 |
2 505 |
| Headline earnings |
2 408 |
30 |
1 850 |
| EBITDA net of capital items |
3 943 |
22 |
3 220 |
|
|
| |
|
| EBITDA net of capital items |
| |
2007
R’m |
2006
R’m |
2005
R’m |
2004
R’m |
2003
R’m |
2002
R’m |
| Operating profit |
2 978 |
2 505 |
1 931 |
1 134 |
961 |
650 |
| Amortisation |
28 |
2 |
— |
39 |
31 |
37 |
| Depreciation |
702 |
625 |
425 |
214 |
192 |
164 |
| Capital items |
235 |
88 |
(2) |
155 |
88 |
99 |
| |
3 943 |
3 220 |
2 354 |
1 542 |
1 272 |
950 |
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