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Unaudited Group Results For The Six Months Ended 30 September 2018
Niveus Investments Limited
(Incorporated in the Republic of South Africa)
Registration number: 1996/005744/06
JSE share code: NIV
ISIN code: ZAE000169553
("the Company" or "the Group" or "Niveus")
UNAUDITED GROUP INTERIM RESULTS for the six months ended 30 September 2018
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited Unaudited Audited
30 September 30 September 31 March
2018 2017 2018
R'000 R'000 R'000
ASSETS
Non-current assets 443 770 926 543 484 664
Property, plant and equipment 51 219 397 535 114 159
Investment properties 263 622 21 164 262 758
Goodwill 8 214 11 714 11 714
Intangible assets 8 364 13 187 12 830
Interest in associates and joint ventures 43 555 27 596 35 322
Other financial assets 66 623 - 38 779
Deferred taxation - 8 805 1 040
Loans receivable 2 173 446 542 8 062
Current assets 236 695 882 946 287 676
Trade and other receivables 114 395 232 074 27 806
Other 1 754 - 336
Cash and cash equivalents 120 546 650 872 259 534
Assets of disposal group classified as held for sale - 641 308 855 273
Total assets 680 465 2 450 797 1 627 613
EQUITY AND LIABILITIES
Equity 566 400 1 974 038 1 400 212
Equity attributable to equity holders of the parent 445 055 1 417 532 924 356
Non-controlling interest 121 345 556 506 475 856
Non current liabilities 42 997 21 435 44 088
Deferred taxation 42 997 21 435 44 088
Current liabilities 71 068 100 651 183 313
Liabilities of disposal group classified as held for sale - 354 673 -
Total equity and liabilities 680 465 2 450 797 1 627 613
Net asset value per share (cents) 373 1 190 776
Net tangible asset value per share (cents) 360 1 169 756
CONDENSED CONSOLIDATED STATEMENT OF PROFIT OR LOSS
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
Restated
% Change R'000 R'000
Revenue 15,2% 9 029 7 841
Net gaming win 58,3% 29 968 18 928
Group revenue 38 997 26 769
Other income - 463
Operating expenses (57 358) (52 763)
EBITDA (18 361) (25 531)
Depreciation and amortisation (2 957) (20 638)
Share of profits (losses) of associates and joint ventures (2 393) 1 860
Investment income 6 836 49 011
Fair value adjustment of other financial assets (24 469) -
Impairment of assets (720) (152)
Impairment of investment in associate - (412)
Gain on disposal of subsidiaries - 1 772
Finance costs (1 999) (62)
Profit before taxation (44 063) 5 848
Taxation 9 103 (24 658)
Profit for the period from continuing operations (34 960) (18 810)
Net result from discontinued operations 30 761 172 663
Profit (loss) for the period (4 199) 153 853
Attributable to:
Equity holders of the parent 2 672 134 524
Non-controlling interest (6 871) 19 329
(4 199) 153 853
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
R'000 R'000
Reconciliation of headline earnings % Change Gross Net Gross Net
Earnings attributable to equity holders of the parent 2 672 134 524
IAS 16 Losses/(gains) on disposal of plant and equipment 2 472 2 250 (603) (464)
IAS 16 Impairment of assets 720 317 3 275 2 388
IAS 27 (Gain)/loss from disposal of subsidiaries (30 174) (30 174) 951 1 315
IAS 28 Impairment of investment in associate - - 412 288
-118,1% (24 935) 138 051
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
Restated
Earnings per share (cents) -98,0% 2,2 112,9
- Continuing operations (23,3) (24,1)
- Discontinued operations 25,5 137,0
Headline earnings per share (cents) -118,1% (20,9) 115,9
- Continuing operations (21,1) (24,8)
- Discontinued operations 0,2 140,7
Diluted earnings per share (cents) -98,0% 2,2 112,1
- Continuing operations (23,3) (24,0)
- Discontinued operations 25,5 136,1
Diluted headline earnings per share (cents) -118,1% (20,9) 115,1
- Continuing operations (21,1) (24,7)
- Discontinued operations 0,2 139,8
Actual number of shares in issue at end of period ('000) 119 163 119 163
Weighted average number of shares in issue ('000) 119 163 119 163
Weighted average number of shares in issue (diluted) ('000) 119 477 119 960
CONDENSED CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
R'000 R'000
(Loss)/profit for the period (4 199) 153 853
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss
Foreign currency translation differences 20 473 9 572
Total comprehensive income 16 274 163 425
Attributable to:
Equity holders of the parent 23 145 144 091
Non-controlling interest (6 871) 19 334
16 274 163 425
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
R'000 R'000
Balance at beginning of period 1 400 212 1 881 755
Total comprehensive income 16 274 163 425
Equity-settled share-based payments (10 414) (2 675)
Effects of changes in holding (8 221) (15 599)
Business combinations and disposals 9 035 4 285
Capital reductions and dividends (840 486) (57 153)
Balance at end of period 566 400 1 974 038
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
R'000 R'000
Cash flows from operating activities 2 821 169 873
Cash generated from operations 15 883 212 121
Net interest 5 233 11 420
Taxation paid (18 295) (53 668)
Cash flows from investing activities (146 911) (104 996)
Additions to property, plant and equipment (2 375) (60 540)
Proceeds from disposal of assets 1 075 1 488
Investment in associates and joint ventures (11 052) (33 739)
Disposal of subsidiaries 565 -
Investment in financial assets (37 398) -
Short term receivable advanced (96 403) -
Other (1 324) (12 205)
Cash flows from financing activities (7 109) (70 792)
Dividends paid - (55 188)
Long-term funding repaid - (15 604)
Transactions with non-controlling shareholders (7 109) -
Decrease in cash and cash equivalents (151 200) (5 915)
Classified as held for sale - (53 052)
Cash and cash equivalents
At beginning of period 259 534 709 839
Foreign exchange differences 12 212 -
At end of period 120 546 650 872
Bank balances and deposits 120 546 650 872
SEGMENTAL ANALYSIS
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
Restated
R'000 R'000
Revenue 9 029 7 841
Gaming and entertainment - 300
Property 9 029 7 541
Net gaming win
Gaming and entertainment 29 968 18 928
EBITDA (18 361) (25 531)
Gaming and entertainment (2 814) (6 023)
Head office and other (14 731) (16 713)
Property (816) (2 795)
Profit before tax (44 063) 5 848
Gaming and entertainment (6 549) (23 741)
Head office and other (21 225) (15 281)
Property (16 289) 44 870
Headline earnings
Continuing operations (25 215) (29 611)
Gaming and entertainment (2 961) (28 631)
Head office and other (17 578) (14 811)
Property (4 676) 13 831
Discontinued operations
Gaming and entertainment 280 167 662
(24 935) 138 051
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Basis of preparation and accounting policies
The interim results for the six months ended 30 September 2018 have been prepared in accordance with International Financial Reporting Standards
("IFRS"), IAS 34 - Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, the Financial
Reporting Pronouncements as issued by the Financial Reporting Standards Council, the requirements of the South African Companies Act, No. 71 of 2008
(as amended) and the Listings Requirements of the JSE Limited. The accounting policies of the Group are consistent with those applied for the year
ended 31 March 2018, except for the adoption of IFRS 9 and IFRS 15 in the current period, which did not have a material impact on the results of
the Group. As required by the Listings Requirements of the JSE Limited, the Group reports headline earnings in accordance with Circular 4/2018 - Headline
Earnings, as issued by the South African Institute of Chartered Accountants. These financial statements were prepared under the supervision of the
financial director, Mr AF Pereira CA(SA).
The interim results for the six months ended 30 September 2018 has not been audited or reviewed by the Group's auditors.
Discontinued operations
During June 2017, Niveus accepted an indicative offer from Tsogo Sun Holdings Limited for the sale of all its interests in Vukani Gaming Corporation
Proprietary Limited ("Vukani"), Galaxy Gaming and Entertainment Proprietary Limited ("Galaxy") and all their associated entities, trusts and businesses
(collectively the "Gaming Businesses") to Tsogo subject to certain conditions precedent. These conditions were met in November 2017 and the sale became
effective. The results of these operations are included in discontinued operations in the prior comparative period.
During June 2017, the Group disposed of subsidiaries Jacaranda Royal Casino Limited, Vslots Lesotho Proprietary Limited and VSlots Swaziland
Proprietary Limited. The results of these operations were included in discontinued operations in the prior comparative period.
On 15 June 2018 the Group disposed of the entire share capital of Niveus Invest 1 Proprietary Limited, the owner of the Grand Oasis Casino in Kuruman,
Northern Cape, for consideration of R94,9 million. The results of these operations are classified under discontinued operations in the current and
prior comparative period.
The Group disposed of its entire interests in Niveus Invest 13 Proprietary Limited and Slots and Keno Limited, effective 1 April 2018 and 31 May 2018,
respectively, for total consideration of R5 million. The results of these operations have been reclassified to discontinued operations in the current
and prior comparative period.
The results of discontinued operations were as follows:
Unaudited Unaudited
Six months Six months
ended ended
30 September 30 September
2018 2017
R'000 R'000
Revenue 1 079 38 069
Net Gaming Win 7 029 697 857
Other income and operating costs (7 139) (472 195)
Share of losses of associates and joint ventures - (3 784)
Investment income 112 778
Depreciation and amortisation (230) (22 736)
Asset impairments - (3 123)
Gain (Loss) on disposal of business 30 174 (2 723)
Finance costs (8) (12 292)
Profit before taxation 31 017 219 851
Taxation (256) (47 188)
Profit from discontinued operations 30 761 172 663
Cash flows from discontinued operations
Cash flows from operating activities 13 139 482
Cash flows from investing activities (505) (47 666)
Cash flows from financing activities - (22 424)
(492) 69 392
Proceeds on disposal, net cash flow on disposal and analysis of assets and liabilities disposed
Property, plant and equipment 59 043
Other non-current assets 7 541
Cash and cash equivalents 4 435
Other current assets 2 345
Current liabilities (12 610)
60 754
Non-controlling interest 9 035
Profit on disposal 30 174
Disposal proceeds 99 963
Set-off against existing liability (94 963)
Cash and cash equivalents at date of disposal (4 435)
Net cash inflow 565
COMMENTARY
During the prior financial year Niveus disposed of its limited payout and bingo operations. It also utilised the majority of cash and promissory notes
held by the La Concorde Group (“La Concorde”) to purchase an interest in Hosken Passenger Logistics and Rail Limited, which interest was distributed
to shareholders during April 2018.
The Group received regulatory approval to dispose of its interest in the Grand Oasis Casino during June 2018, resulting in the conclusion of the
disposal of the Group’s limited payout, bingo and casino operations to Tsogo Sun Holdings.
Niveus’ remaining investments consist significantly of its interests in La Concorde, online and retail sports betting operator, BETcoza, and golf radar
tracing technology company, Alphawave.
La Concorde
The assets of La Concorde consist mainly of investment property, art and cash, as well as HPL&R shares acquired during the acquisition and distribution
of the Group’s interest in that company. The La Concorde office building is fully tenanted and improved utilisation of the Laborie estate’s existing
facilities is being planned. Further development of other properties is continuously being considered, however, the current zoning of certain properties
will result in significant delays.
BETcoza
Niveus has an interest in online sports betting and retail sports betting licences of which four are currently operational. While certain key performance
indicators of the business are encouraging, it remains in a start-up phase and may require further funding to scale appropriately.
Alphawave
Niveus invested in a start-up investment, developing radar tracing products in the golf industry, during the previous financial year. Development progress
is in line with planned targets. Due to the early phase nature of this business, further investment will be required to reach commercial viability.
CHANGES IN DIRECTORATE
Mr Andre van der Veen resigned as non-executive director effective 1 August 2018. Ms Muriel Loftie-Eaton resigned as executive director and CEO on
1 August 2018, Mr Yunis Shaik replacing her as CEO effective the same date. Ms Carolyn Kristal resigned as financial director effective 1 July 2018,
replaced by Mr Cisco Pereira from the same date.
DIVIDEND
The directors have resolved not to declare an interim dividend.
Yunis Shaik
Chief executive officer
21 November 2018
Paarl
Directors: JA Copelyn+, ML Molefi#, JG Ngcobo#, AF Pereira*, Y Shaik*, RD Watson#
(* executive + non-executive # independent non-executive)
Company secretary: HCI Managerial Services Proprietary Limited
Transfer secretaries: Computershare Investor Services Proprietary Limited
Sponsor: PSG Capital Proprietary Limited
Date: 21/11/2018 04:45:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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