for the six months ended 30 June 2005 · 2019. 5. 13. · Old Mutual Sanlam Welihockyj interests BD Buckham Netcare Fraters RMB Other SHAREHOLDER ANALYSIS SHAREHOLDER SPREAD. Interim

Interim results presentation - 30 June 2005

unaudited resultsfor the six months ended 30 June 2005


INTRODUCTION

“Education is the most powerful weapon which you can use to change the world”.

Nelson Mandela


INTRODUCTION

“Those who educate children well are more to be honoured than parents, for these only gave life, those the art of living well”.

Aristotle


OVERVIEW

• The ADvTECH Group is a leader in Southern Africa in the area of Education, Skills Development and Human Resource Management

• The Group is focused on the development, deployment and management of human capital

• The business operates through two primary divisions, namely:

• Education

• Resourcing


ORGANISATIONAL STRUCTURE

ADvTECH Education

ADvTECH Resourcing

• Schools

• Tertiary

• Skills

• Recruitment

• Other


SCHOOLS TERTIARY SKILLS

Imfundo


RECRUITMENT OTHER


1 2 3

4 6

7 9

10

13 14

HF Brown (Chairman) *

FR Thompson (CEO) #

J Deeb (Tertiary/FD) #

CN Duff (Marketing) #

HR Levin *

DK Ferreira *

JNP Booyens (Properties) #

DL Honey (Resourcing) #

MI Sacks *

BD Buckham *

Prof J Jansen *

Prof DS Dowling (Bond) @

A Isaakidis (Schools) @

S Schwanzer (HR) @

1

101

6

11

5

2

3

7

4

8

9

12

12

1413

1313

11

8

5

BOARD OF DIRECTORS &

SENIOR MANAGEMENT

* Non – Executive Director # Executive Director @ Senior Management


23%

13%

10%7%7%

7%

5%4%

24%

Directors & StaffOld MutualSanlamWelihockyj interestsBD BuckhamNetcareFratersRMBOther

SHAREHOLDERANALYSIS

SHAREHOLDER SPREAD


MARKETDATA

Share Statistics (30/08/2005)

Share Price (cents) 180

Market Cap (R’m) 709

Shares in Issue (m) 394

0

0.5

1

1.5

2

2.5

AdvTech JSE All share Index JSE Cyclical Index

12 MONTHS

Jan ‘02 to August

‘05

0

1

2

3

4

5

6

7

8

AdvTech JSE All share Index JSE Cyclical Index


OPERATIONAL HIGHLIGHTS

o Operating margins improved

o Additional capacity resulting from investment in educational infrastructure

o Strengthened group management

o Academic expertise, governance and credibility further enhanced


EDUCATION

o The benefits of the recent capital expenditure began to filter through

o The division benefited from a solid improvement in enrolments across all campuses.

o Good gains were achieved, albeit from a low base, at Imfundo

o Independent Institute of Education contributed to the Group’s enhanced academic expertise, governance and credibility


RESOURCING

o Positive economic environment

o Strong performance in key areas, where ADvTECH enjoys market leadership positions

o Finance

o IT

o Engineering

o Increased efficiency and effectiveness of operations

http://www.advtech.co.za/


JSE listed companies are required to adopt IFRS in the first financial year commencing on after 01 January 2005

• ADvTECH’s results for the year ending 31 December 2005 will the first set of annual financial statements that comply with IFRS

• The Group’s transition date for the adoption of IFRS is 01 January 2004

The main adjustments relate to accelerated depreciation (ISA16), operating leases (IAS17) and share based payments (IFRS 2)

IFRS

IT MUST BE NOTED THAT NONE OF THE ADJUSTMENTS ARE SUBSTANTIVE AND THEY HAVE NO CASH FLOW EFFECT


IFRS

IFRS Impact on accumulated loss as at 01 January ‘04

Accelerated depreciation

(R4,724)

(R3,048)

Operating lease adjustment

SA GAAP accumulated loss = R148,837

IFRS restated accumulated loss = R156,719

= (R7,882)

Share based payments

(R110)

All amounts in R’000


IFRS Impact on Income Statement for the year ended 31 December 2004

Accelerated depreciation

(R937)

(R809)


(R195)


SA GAAP net profit after tax = R39,250

= (R1,941)

IFRS restated net profit after tax = R37,309

12,0 (cents)

HEPS (BEFORE)

11,5 (cents)

HEPS (AFTER)

IFRS



IFRS Impact on Income Statement for the 6 month period ended 30 June 2005

IFRS Accelerated depreciation

(R309)

(R70)


SA GAAP net profit after tax = R26,970

(R886)


IFRS restated net profit after tax = R25,704

= (R1,266)

7,0 (cents)

HEPS (AFTER)

7,3 (cents)

HEPS (BEFORE)



FREE OPERATING CASH FLOW PER

SHARE

26%

31.1centsFINANCIAL

OVERVIEW

25%

OPERATING PROFIT

R36,7 m

REVENUE

20%

R332,6 m

NAV PER SHARE

14%

69.7cents


6.5 cents

FULLY DILUTED HEPS

48%

DILUTED HEPS

43%

6.7 cents

FINANCIALOVERVIEW 6.8

cents

30%

DILUTED EPS CONTINUING OPERATIONS


020406080

100120140

R'm

2002 2003 2004 2005

Net Cash from Operating Activities

FINANCIALHIGHLIGHTS

05

101520253035

cents

2002 2003 2004 2005

Free Operating Cashflow per Share

The above graphs refer to the respective 6 months period to June


SEGMENTALREVIEW -

EDUCATION

6 months % change 2005 2004

R’000

Revenue 20% 292,738 243,704

Operating profit 26% 47,006 37,272

Operating margin 16,1% 15,3%

88%

12%

EducationResourcing

REVENUE


SEGMENTALREVIEW -

RESOURCING

6 months % change 2005 2004

R’000

Revenue 20% 39,908 33,186

Operating profit 34% 5,328 3,987

Operating margin 13,4% 12,0%

88%

12%

EducationResourcing

REVENUE


June June December

R’000 2005 2004 2004

Unaudited Restated- Restated-

Unaudited Unaudited6 months 6 months 12 months

Capital expenditure – current period 39,634 14,210 43,510Capital commitments – remainder of year 41,895 20,657 -

Total 81,529 34,867 43,510

Capital commitments - Future years 2,200 27,143 82,416

CAPEX

“Our growth strategy continues to deliver, resulting in a new wave of investment in educational infrastructure, which creates a secure, quality platform for continued growth in the learner enrolment, academic achievement and a sustainable financial performance.”

Source: ADvTECH Press Release, 14 March 2005


REPORT CARD

PASSED

• Both Education and Resourcing divisions in a “promising growth phase”

Education revenue up 20%Resourcing revenue up 20%Invested R40 million in educational infrastructure in past 6 months

• Improved headline earnings and operating cash flows / HEPS to increase by 25% to 45%

HEPS up 43%Cash from operations up 79%

• Every effort being made to conclude litigation in the interest of shareholders

Legal proceedings still in progress


GROWTH STRATEGY

At Campuslevel

Org

anic

At Grouplevel

Stra

tegi

c

At Divisionallevel

Expa

nsio

nPlatform for Sustainable Growth

Strong Financial Track Record

Competent Management

Academic Capacity

Investment inInfrastructure

Academic Achievement


PROSPECTS

Current Economic Climate

• JSE All Share Index is at an all-time high

• Longest period of economic expansion on record

• Lowest inflation and interest rate environment in decades

• Record high consumer and business confidence levels

• Significant income taxation relief in recent Budgets

• Increased household disposable income


SOUTH AFRICAN MARKET

GROWING STRONGER

AS THE Reserve Bank reminded us yesterday, the economy has been in an upward phase of the business cycle for nearly six years, since September 1999, making this the longest period of economic expansion in the recorded economic history of SA.

Gross domestic product was running at an annualised 4,8% in the second quarter of this year, says Stats SA. The figure came in above market expectations and well ahead of the 3,5% for the first quarter. Most economists were already expecting full-year growth to come out at, or above, 4% (the treasury’s forecast is 4,3%). The better than expected second-quarter figures confirm this is on the cards. That would make this only the third time in two decades that the annual economic growth rate has exceeded 4%.

Source: Business Day, 25 August 2005

Consumer confidence at record levelsMail & Guardian Online, 11May 2005

Consumer confidence now 'very high'I-Net Bridge, 05 July 2005

Business confidence risesSapa, 06 July 2005


Source: Business Day , August 2005


Against this background, ADvTECH’s:

• Further investment in educational infrastructure and encouraging

developments in the skills and adult education division, Imfundo

• Increased student enrolments across all divisions

• Anticipated further growth in the Recruitment division

supports the board’s expectation that …

PROSPECTS

In the absence of any materially adverse factors improved full

year results and cash flow will be achieved once again


Q&A

Documents

for the six months ended 30 June 2005 · 2019. 5. 13. · Old Mutual Sanlam Welihockyj interests BD Buckham Netcare Fraters RMB Other SHAREHOLDER ANALYSIS SHAREHOLDER SPREAD. Interim