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CAFCA LIMITED - Unaudited Abridged Financial Results for the six months ended 31 March 2019

16 May 2019 - 14:14 PM
CAC
Unaudited Abridged Financial Results for the six months ended 31 March 2019

Cafca Limited
Share Code: CAC
ISIN Code: ZW0009011942


Unaudited Abridged Financial Results for the six months ended 31 March 2019

All figures in United Stated Dollars
                                                      UNUADITED            UNAUDITED           AUDITED
                                                        SIX MONTHS TO      SIX MONTHS TO       FULL YEAR TO
                                                                                               30 SEPETMBER
                                                        31 MARCH 2019      31 MARCH 2018           2018
ABRIDGED STATEMENT OF COMPREHENSIVE INCOME                    $                   $                 $
Revenue                                                  18,389,544           13,261,956        30,382,348
Operating profit                                          3,546,518           2,457,172          5,234,021
Profit Before Income tax                                  3,546,518           2,457,172          5,234,021
Income tax expense                                        (994,406)           (663,032)         (1,374,589)
Profit for the period                                     2,552,112           1,794,140          3,859,432
Other Comprehensive Income:                                   -                   -                 -
Total Comprehensive Income for the period                 2,522,112           1,794,140          3,859,432




Issued Ordinary Shares (weighted) (number)               33,136,000           33,009,000        33,059,000
Basic Earnings per share (cents)                            7.70                5.44              11.67
Diluted Earnings per share(number)                       33,459,000           33,459,000        33,459,000
Diluted Earnings per share (cents)                          7.63                5.36              11.53

Headline Earnings per share(number)                      33,136,666         32,009,000          33,059,000
Headline Earnings per share (cents)                         7.70              5.44               11.67

                                                        UNAUDITED             UNAUDITED         AUDITED
                                                          SIX MONTHS TO       SIX MONTHS TO      FULL YEAR TO
                                                                                                 30 SEPTEMBER
 STATEMENT OF FINANCIAL POSITION                          31 MARCH 2019       31 MARCH 2018          2018
                                                                                                       $
                                                                   $                  $

ASSETS
Non Current Assets
Property, plant and equipment                               3,121,495           3,121,369          2,990,638
Loans and receivables                                                  -              12,361              -
Current Assets
Inventory                                     10,636,783        8,042,110         8,624,425
Trade and other receivables                    2,330,501        1,858,500         2,041,792
Cash and cash equivalents                     7,082,707         7,743,423         8,854,476
Total Assets                                  23,171,486       20,777,763        22,511,331
Equity attributable to owners of the parent
Share capital                                       331              328                  331
Share premium                                    324,871          220,012           254,701
Share option reserve                             251,413          132,000           193,600
Retained earnings                             16,169,581       17,054,609        15,648,705
Total Equity                                  16,746,196       17,406,949        16,097,337

 LIABILITIES
 Non-current assets
 Deferred income tax liabilities               641,972         773,757               656,692

 Current liabilities
 Trade and other payables                     3,262,905       2,406,074         2,167,920
 Current income tax liabilities                 489,176         190,983           118,187
 Dividend payable                             2,031,237          -              3,471,195

 Total liabilities                            6,425,290       3,370,814         6,413,994

 Total equity and liabilities                 23,171,486      20,777,763        22,551,331

STATEMENT OF CHANGES IN EQUITY
                                              Share Capital     Share Premium    Share Option   Retained
                                                                                 Reserve        earnings      Total
                                              $                 $                $              $             $
Balance at 1 October 2017                     328               177,948          20,056          15,260,469    15,458,801
Transaction with owners:
Issue of shares                                -                 40,400           -                 -             40,400
Share options                                  3                36,353            173,544          -             209,900
Comprehensive income:
Profit for the year                           -                  -                   -           3,859,432   3,859,432
Dividend declared                                                                               (3,471,195) (3,471,195)
Balance at 30 September 2018                  331               254,701          193,600        15,648,706 16,097,338

 Balance at 1 October 2018                    331               254,701          193,600        15,648,706    16,097,338
 Transaction with owners:
 Issue of shares                              -                 19,250           -                      -         19,250
 Share options
 Comprehensive income:                        -                 50,920           57,767              -         108,733
Profit for the period                         -                   -              -               2,252,112   2,252,112
Dividend declared                              -                  -                  -          (2,031,237) (2,031,237)
Balance at 31 March 2019                      331                324,871        251,413         16,169,581 16,746,196
ABRIDGED STATEMENT OF CASH FLOWS
                                                SIX MONTHS TO   SIX MONTHS TO      FULL YEAR TO
                                                31 MARCH 2019    31 MARCH 2018     30 SEPTEMBER 2018


Profit before income tax                              3,546,518       2,457,172         5,234,021
Depreciation                                            197,646         179,686           361,528
Share option expense                                    108,733         122,208            209,900
Profit on sale of property plant,and equipment           (7,500)         (3,770)            (3,770)
Fiance income received                                     (164)           (195)            (1,364)
Changes in working capital                           (4,677,277)       1,283,527           285,946
cash utilised in operations                            (832,044)       4,038,628         6,086,261
Finance income                                            (164)             (195)            1,364
Income tax paid                                         (637,786)       (468,521)       (1,369,640)
Net cash (utilised)/generated from operating
activities                                           ( 1,469,666)       3,570,302          4,717,985
Acquisition of plant and equipment                     (328,503)         (36,799)           (88,209)
Proceeds from sale of property plant and
equipment                                               7,150              3,770                3,769
Treasury bills maturity                                   -                6,179               12,360
Net utilised in investing activities                  (321,353)           (26,850)             (72,080)
CASHFLOWS FROM FINANCING ACTIVITIES
Proceeds from issue of share capital                    19,250            31,800             40,400
Net in(decrease)/increase in cash and cash equivalents (1,771,769)     3,575,252          4,686,305
Cash and cash equivalents at beginning of the period   8,854,476       4,168,171          4,168,171
Cash and cash equivalents at end of period             7,082,707       7,743,423          8,854,476


NOTES THE FINANCIAL STATEMENTS

1. The unaudited abridged results of CAFCA Limited (the ''Company''), have been prepared in accordance with IAS 34, 'Interim financial
reporting', and in the manner required by the Zimbabwe Companies Act (Chapter 24.03). The same accounting policies and methods of computation
are followed in the unaudited results as compared with the most recent annual financial statements for the year ended 30 September 2018. IAS 21
has not been complied with as it in conflict with statutory instrument 33 of 2019.

IFRS 9 and IFRS 15 effective 1 October 2018 have had no material impact on numbers presented

2.The financial statements for the period October to March 2019 are in ZWL$ and results for March 2018 and September 2018 US$.

3.Related party transactions
 Reunert Engineering(Proprietary) Limited owns 70% of the company and the remaining 30% are widely held.
 The following transactions were carried out with related parties:


                                                      UNDAUDITED        UNAUDITED       AUDITED
                                                      SIX MONTHS TO     SIX MONTHS TO TWELVE MONTHS
                                                      31 MARCH 2019     31 MARCH 2018 30 SEPTEMBER
                                                                                          2018
Purchases during the year from holding company
CBI-Electric African Cables a division of ATC(Pty) Ltd    622,658          1,403,088      2,602,046
CBI Electric Telecoms Cable(Pty) Ltd                         -                       21,345         23,627
Metal Fabricators of Zambia PLC                             52,788                   56,213         56,213
Goods and services are bought from related parties on
Commercial terms and conditions.

Sales during the year to holding company
Metal Fabricators of Zambia PLC                                -                      18,346       18,346
Balances arising from purchase of goods and services
Payables to related parties
CBI-Electric African Cables a division of ATC (Pty) Ltd         32,170                394,593       7,950
Metal Fabricators of Zambia PLC                                  -                     56,213        -

There were no loans made to directors of the Group companies

Key management remuneration
Key management includes directors(executive and non-executive)
and executive managers(members of the executive)

Salaries and short term benefits                            403,562               310,791         655,336
Share options(credit)/charge                                108,122               122,208         209,900
Directors fees                                               48,180                44,530          65,058
Commitments

4.The Company had no significant capital commitments authorised by directors or contracted for at the reporting period.

5.Property plant and equipment


                                                  SIX MONTHS TO SIX MONHTS TO FULL YEAR TO
                                                31 MARCH 2019 31 MARCH 2018 30 SEPTEMBER 2018

Capital expenditure                               359,307              150,292          173,684
Depreciation                                      180,032              164,659          319,270


6.Segment information
The executive management team is the Companys Chief operating decision maker. Management has determined the operating segments based on reports
reviewed by the executive team that are used to make strategic decisions.The Company has one product line,and operates in one industry sector.


                                                          UNUADITED              UNAUDITED          AUDITED
                                                          SIX MONTHS TO          SIX MONTHS TO      FULL YEAR TO
                                                                                                    30 SEPETMBER
                                                          31 MARCH 2019          31 MARCH 2018          2018


Revenue from customers domiciled in Zimbabwe              17,761,220          8,931,661           29,327,891
Revenue from external customers                              828,324            425,930            1,054,457
Total                                                     18,589,544         13,261,596           30,382,348

Revenue from transactions with single local customers that amounted to 10% of more of each of the Companys revenues equal approximately to ZWL$
$2,592,366.
These revenues are attributable to customers domiciled in Zimbabwe .The breakdown of the major component of the total revenue from individual
local customers with revenue of at least 10% is as follows:

Energy transmission                                   2,592,366          4,968,291        6,583,033
The segment information provided to the executive team for the reportable segments for six months to 31 March are as follows:


Revenue from customers                                  18,589,544        13,261,956      30,382,348
Depreciation                                               197,646          179,686          361,529
Share option charge                                        108,733          122,208          209,900
Profit before income tax                                 3,546,518        2,457,172        5,234,021
Income tax expense                                         994,406          663,032        1,374,589
Total assets                                            23,171,486       20,777,763       22,511,331
Total liabilities                                        6,425,290        3,370,814        6,413,994

7.Sensitivity Analysis
A senisitivity analysis has not been done on revenue to consider the impact of the various exchange base anomalies as the rate information is not
available

8.The final dividend for the year ended 30 September 2018 was paid to the transfer secretaries on 8 October 2018.Payment by the Transfer
secretaries to external shareholders is awaiting Reserve Bank of Zimbabwe approval to remit.Local shareholders not paid must please contact the
Transfer secretaries as per contact details at the end of the commentary.




COMMENTARY AND OVERVIEW OF RESULTS

PROFITABILITY
Revenue for the six month period to 31 March 2019 was ZWL $18,6 million whilst the revenue for the comparative period last year was US$13,3
million. It should be noted that 4 months of the current years revenue has been deemed by the Authorities to be at an exchange rate of 1:1 to
the US$. The functional currency of the Country and CAFCA was changed on 22 February 2019 to ZWL from US$.

Translation of current and previous years revenue to achieve comparability has not been possible as there is a conflict between Zimbabwean
legislation Statutory Instrument 33 of 2019 and International Accounting Standard 21 as to the exchange rates to use.

The pretax profit for the period is ZWL $3,546 million whilst the profit for the comparative period last year was US$2,456(m). Stakeholders
should be wary for the reasons given above to place any significance on year on year comparison.

STATEMENT OF FINANCIAL POSITION
Fixed assets of $3,121,495 are stated at the US$ conversion cost from 2009 with additions since then in US$ except for current additions of $298
490 which were purchased at ZWL rates.

Inventories of ZWL $10,6 million can be split as to ZWL $6,6 million being at parity to US$ with the balance being ZWL related.

Debtors and bank balances of $9.3 million can be split into $1,5 million of US$ balances and the remainder ZWL$ balance.
All other amounts in the Statement of Financial Position are ZWL$ related.

What is significant to note from the Statement of Financial Position is that there is adequate liquidity to operate and trade for the foreseeable
future and adequate hedges in various asset classes against any future hyperinflation. There is no exposure to US$ liabilities.

OUTLOOK
The company is well placed to meet all the requirements of the local market and to continue meeting the requirements of our export customers.

The company is concerned that the shortage of foreign currency is going to lead to acute hyperinflation and the customers will not be able to
either afford or finance purchases from CAFCA.

DIVIDEND
Notice is hereby given that the Board declared an interim dividend of 6.13 ZWL cents per share for the year ended 31 September 2019 payable in
respect of all the ordinary shares of the Company. This dividend will be payable in full to all Shareholders of the Company registered at the
close of business on 31 May 2019.

The payment of the dividend will take place on or about 14 June 2019. The applicable shareholders tax will be deducted from the Gross Dividends.

The shares of the Company will be traded cum-dividend on the Zimbabwe Stock Exchange up to the market day of 28 May 2019 and ex-dividend as from
29 May 2019.

Shareholders are requested to submit/update their mailing and banking details with the Transfer Secretaries to enable the payment of their
dividends on the following contacts.
First Transfer Secretaries (Pvt) Ltd
1 Armagh Avenue
Eastlea
Harare

Telephone: +263 242 782869/72 or 776628/49/59/69/74

Email: info@fts-net.com


By order of Board

C Kangara
Company Secretary
16 May 2019



Directors: H.P.Mkushi (Chairman), R.N. Webster (Managing), E.T.Z.Chidzonga
           A.Mabena, S.E Mangwengwende, P De Villiers, L.De Jager, G.J.H Steyn,T.Taylor

Date: 16/05/2019 02:14:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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