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TSH
TSH
TSH - Tsogo Sun Holdings Limited - Reviewed Consolidated Financial Results
For the year ended 31 March 2012
Tsogo Sun Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1989/002108/06) Share code: TSH ISIN: ZAE000156238
("Tsogo Sun" or "the company" or "the group")
REVIEWED CONSOLIDATED FINANCIAL RESULTS
For the year ended 31 March 2012
Income R9.0 billion up 39%
EBITDAR R3.5 billion up 41%
Adjusted earnings R1.3 billion up 36%
Adjusted HEPS 121.5 cents up 12%
INTRODUCTION
The merger of Tsogo Sun Holdings (Pty) Ltd ("TSH") and Gold Reef Resorts Ltd
("Gold Reef") and the effective reverse listing of the Tsogo group via the
acquisition by Gold Reef of the entire issued share capital of TSH through the
issue of new shares ("the consideration shares") to Tsogo Investment Holding
Company (Pty) Ltd ("TIH") and SABSA Holdings (Pty) Ltd ("SABSA") was concluded
on 24 February 2011.
In terms of IFRS 3 - Business Combinations (Revised), the transaction is a
reverse acquisition as the shareholders of TSH became the majority shareholders
of Gold Reef. Accordingly, TSH is treated as the acquirer for accounting
purposes, whilst Gold Reef is the legal acquirer and remains the listed entity.
Shareholder approval was obtained to rename Gold Reef to Tsogo Sun Holdings Ltd
("Tsogo Sun") at the Annual General Meeting held on 15 June 2011. The effective
date of the name change occurred on 5 August 2011, and has been registered by
the Companies and Intellectual Property Commission.
The condensed consolidated income statement and cash flow statement for the year
ended 31 March 2012 represent the consolidated results of the merged group. The
comparative information for the prior period represents the consolidated results
of the group for the year ended 31 March 2011 with Gold Reef included from 24
February 2011.
COMMENTARY
The overall performance for the year was satisfactory, with a noticeable
increase in activity levels in the second six months. Both casino win and hotel
occupancy showed accelerated year on year growth and allowed the group to
achieve margin expansion for the first time since 2008. During the year under
review, the group has focused on integrating the Gold Reef businesses. This
process has largely been completed, culminating in the rebranding and launch of
the group`s new look identity in April 2012.
In addition, the group has continued to allocate capital in terms of its growth
strategy and accordingly concluded the acquisitions of:
- an additional 16.5% effective interest in the Suncoast Casino for R510
million, bringing the Tsogo group`s total ownership of that operation to 90%;
- an additional 52.6% of Hotel Formula 1 (Pty) Ltd and related property
companies for a cash consideration of R300 million, bringing the group`s
effective shareholding to 100%;
- the hotel and office building in Rosebank for R85 million (previously traded
as "the Grace") which is scheduled to be re-launched as "54 on Bath" on 1 July
2012; and
- the Garden Court Milpark for R95 million (previously leased by the group).
In addition to these acquisitions, the redevelopment of the Hemingways casino in
East London continued in terms of the R400 million relicensing which was
successfully completed during the prior year, and over R400 million was spent on
maintenance capex group-wide to ensure our assets remain best in class.
Total income of R9,0 billion ended 39% above the prior year, assisted by the
inclusion of R2,2 billion incremental income from Gold Reef, and satisfactory
organic growth offset by the non-recurrence of 2010 FIFA World Cup ("World Cup")
related income. Like-for-like growth in income (including Gold Reef ) is 5%.
Earnings before interest, income tax, depreciation, amortisation, property
rentals, long term incentives and exceptional items ("EBITDAR") at R3,5 billion
reflected a 41% increase on the prior year, including additional EBITDAR from
Gold Reef and good organic growth in the current year. Like-for-like EBITDAR
(including Gold Reef) is 7% up on the prior period, again impacted by the non-
recurrence of World Cup related earnings in hotels. The overall group EBITDAR
margin of 38.8% is 0,6pp above the prior year.
Gaming experienced revenue growth throughout the financial year with accelerated
revenue growth across many of the group`s casinos during the second six months.
Hotels, which benefited from the World Cup in June and July 2010, reflected
revenues in line with the comparative period for the full year but has shown
stronger revenue growth, driven by increased occupancies, during the second half
of the year.
As previously reported, the underlying operations of the group remain highly
geared towards the South African consumer (in gaming) and the corporate market
(in hotels) with both sectors experiencing difficult economic conditions and
increased administered costs. The group is poised for growth if these sectors of
the South African economy continue to improve.
Regulatory risks remain a threat to the group as evidenced by the announcement
in the National Budget of a proposed additional tax of 1% of gaming revenue with
effect from 1 April 2013, albeit a better alternative to the previously proposed
withholding tax on winnings. The risk remains of additional changes to tax rates
and an increased cost burden of compliance with various regulations.
The group continues to engage with the various regulatory bodies and other
Government departments on a constructive basis to ensure that proposed changes
are warranted and capable of being implemented without having a negative impact
on both current and new investment in the industry, and consequently on
employment levels.
Gauteng recorded provincial growth in gaming win of 5.5% for the year over the
prior period. Montecasino and Gold Reef City casinos recorded gaming win growth
of 8.4% and 11.3% respectively for the year, while Silverstar casino recorded a
decline of 1.1% for the same period. The results of Montecasino and Gold Reef
City casinos are particularly satisfying as these units experienced good
footfall during the prior year World Cup. Good cost control resulted in improved
EBITDAR margins being recorded at all three units.
KwaZulu-Natal provincial gaming win grew by 7.8% for the year with the Suncoast
Casino and Entertainment World reflecting growth of 5.8% in gaming win, and
Golden Horse casino and Blackrock casino reflecting growth of 11.6% and 13.7%
respectively, showing strong demand in their relevant catchment areas. Improved
EBITDAR margins were also recorded at all three units.
Mpumalanga reported growth in provincial gaming win of 9.3% for the year. The
Ridge casino in Emalahleni and the Emnotweni casino in Nelspruit reported growth
in gaming win of 7.5% and 8.8% respectively for the year. EBITDAR margin
improvement was achieved at Emnotweni, with the Ridge experiencing a dilution in
margin as a result of improved lower margin hotel trading.
The Eastern Cape provincial gaming win grew by 5.3% for the year. However,
Hemingways reported growth in gaming win of 7.2%, despite the impact of the
redevelopment related construction activities, and continues to benefit from the
attractions associated with Hemingways Mall which opened in 2009. EBITDAR margin
declined marginally on the prior year.
The Western Cape reported growth in provincial gaming win of 6.7% for the year.
The Caledon Hotel and Spa, Garden Route casino in Mossel Bay and the Mykonos
casino in Langebaan reported growth of 7.6%, 5.0% and 2.5% respectively for the
year despite the poor economic fundamentals, particularly in the leisure-based
coastal areas outside of the larger Cape Metropole. Improved EBITDAR margins
were recorded at all three units.
The Goldfields casino in the Free State performed well with growth in gaming win
of 7.9% on the prior year and an improvement in EBITDAR margin.
Other gaming operations, consisting of the Sandton Convention Centre, the Stay
Easy Century City hotel and head office costs, reflected a loss of R150 million,
R77 million adverse to the prior period mainly due to non-repeating World Cup
related trading at the Sandton Convention Centre, the inclusion of Gold Reef
central costs and the centralisation of certain service departments.
The hotel industry in South Africa is still experiencing the dual impact of
depressed demand and over supply, with overall industry occupancies of 57% for
the year. The group`s hotels are likewise affected. However, as a result of the
strong sales and distribution channels and the superior product and service
quality available within the group, a significant occupancy and rate premium is
being achieved in the segments in which the group operates. Showing some
recovery, the group`s system- wide occupancies in South Africa improved to 60.9%
(2011: 58.4%), as rooms sold increased by 5% despite the closure of the Grayston
hotel in December 2011. Average room rates in the South African operations
declined by 7% to R775, with virtually all the decline attributable to the
higher achieved rates during the World Cup in the prior year. Overall revenue
for hotels is flat on the prior year at R1,6 billion. Operating costs were well
controlled with a 5% increase on the prior year, despite increased regulated
utility costs and property rates offset by a saving in World Cup specific
related costs incurred in the prior year. EBITDAR declined 9% to R512 million at
a margin of 31.5%.
The offshore division of hotels achieved total revenue of R324 million during
the year, representing a 20% improvement on the prior year, assisted by the
inclusion of Southern Sun Nairobi as a leased hotel (previously managed) with
effect from 1 August 2010. EBITDAR (pre-foreign exchange gains)of R88 million
was achieved. The Rand weakness in the second half of the year positively
impacted both the translation of USD and Euro earnings streams as well as
resulting in a R13 million foreign exchange gain on the translation of offshore
monetary items.
Combined South African and offshore hotel trading statistics, reflecting the
Tsogo Sun group owned hotels and excluding hotels managed on behalf of third
parties, are as follows:
31 March 31 March
2012 2011
Occupancy (%) 61.4 58.4
Average room rate (R) 802 855
Revpar (R) 492 499
Rooms available (`000) 3 281 3 186
Rooms sold (`000) 2 014 1 860
Rooms revenue (Rm) 1 615 1 591
All operating cost categories for the year are not comparable to the same period
in the prior year as a result of the consolidation of Gold Reef. The group
continues to exercise strict cost control and explore avenues for further margin
improvement.
Amortisation and depreciation at R623 million is 39% above the prior year mainly
due to R185 million incremental Gold Reef costs.
Exceptional gains for the year of R385 million relate mainly to a fair value
adjustment to the existing Formula 1 equity investment of R179 million and the
release of the contingent purchase consideration for the 2009 Millennium
transaction of R248 million offset by investment and loan impairments of R45
million. Exceptional losses for the prior year of R420 million related mainly to
a fair value adjustment to the Gold Reef equity investment of R299 million, Gold
Reef merger costs of R93 million and costs for the termination of the Southern
Sun Grayston lease of R21 million.
Net finance costs are 7% up on the prior year notwithstanding the take on of the
additional Gold Reef debt, as the cash generated by the group has reduced steady
state borrowing levels despite the acquisitions during the year.
The group`s share of associate and joint venture profits at R10 million for the
year ended 31 March 2012 reflected a R69 million decrease as the investment in
Gold Reef was equity accounted in the prior year.
The effective tax rate for the year at 29.3% is affected by, inter alia, the
Secondary Tax on Companies ("STC") impact of R67 million on the final dividend
for the year ended 31 March 2011, declared on 19 May 2011, offset by the non-
taxable exceptional credits to the income statement as mentioned above.
The comparative effective tax rate of 40.6% is due to, inter alia, the large
non-
deductible exceptional debits to the income statement offset by there being no
STC charge in the prior year. The group`s long-term effective tax rate is
expected to be higher than the statutory rate as a result of non-deductible
expenditure such as casino building depreciation, preference share dividends
relating to preference share capital of subsidiaries of the group, as well as
STC prior to being replaced by the dividends tax.
Group adjusted headline earnings for the year under review at R1.3 billion is
36% above the prior year. In determining the closing and weighted average number
of shares for the period and the prior comparative period, the group has used
the consideration shares as the appropriate number of shares for calculating the
earnings per share ("EPS"), headline earnings per share ("HEPS") and adjusted
headline earnings per share ("adjusted HEPS") for TSH and the actual shares in
issue post the issue of the consideration shares, excluding treasury shares, for
the combined group. Adjusted HEPS is 12% above the prior year despite the effect
of the World Cup and the variance in STC as described above.
Cash generated from operations during the year under review was R3.4 billion, an
increase of 49% on the prior year as a result of the Gold Reef merger. Cash
flows utilised for investment activities and non-controlling interest
transactions of R1.4 billion consisted mainly of maintenance expenditure and the
acquisitions and investments described above.
Interest-bearing debt net of cash at 31 March 2012 totalled R4.2 billion, which
is in line with the 31 March 2011 balance, with R816 million paid in dividends
to group and non-controlling shareholders in addition to the investment
activities during the year ended 31 March 2012.
There have been no subsequent events which would impact the financial position
or results of the group since 31 March 2012 and the date of this report.
PROSPECTS
The accelerated trading performance across the group`s operations in the second
half of the year is encouraging, although the sustainability thereof is
uncertain. Nevertheless, the group remains highly cash generative and has
significant opportunities to invest capital in its growth strategy.
Plans are at an advanced stage for the redevelopment of the Silverstar casino,
where the group expects to invest some R320 million in new facilities, including
cinemas, restaurants, concert and entertainment areas and conferencing
facilities, to better service the West Rand market.
The group is also exploring a variety of projects, including the redevelopment
of the Gold Reef City Theme Park, the expansion of the Suncoast Casino and
related entertainment facilities, and the opportunity to bid for the relocation
of one of the smaller casinos in the Western Cape to the Cape Metropole as well
as a number of potential acquisitions which are in various stages.
The ability to continue to pursue such investment will depend on the final
outcome of, and impact from, the variety of proposed regulatory and tax changes
considered by Government and will require the successful interaction with
various regulatory bodies including gaming boards, city councils, provincial
authorities and national departments.
DIVIDEND
The board of directors has declared a final gross cash dividend of 40 (forty)
cents per share in respect of the company`s year-end. The dividend has been
declared in South African currency and is payable to shareholders recorded in
the register of the company at close of business on Friday, 8 June 2012. The
total STC credits utilised as part of this declaration amount to R11.5 million.
The number of ordinary shares in issue at the date of this declaration is 1 097
103 626 (excluding treasury shares) and consequently the STC credits utilised
per share amount to 1.0479 cents per share. The dividend will be subject to a
local dividend tax rate of 15% which will result in a net dividend to those
shareholders who are not exempt from paying dividend tax of 34.15719 cents per
share. The company`s tax reference number is 9250039717.
In compliance with the requirements of Strate, the electronic and custody system
used by the JSE, the following dates are applicable:
2012
Last date to trade cum dividend Friday, 1 June
Shares trade ex dividend Monday, 4 June
Record date Friday, 8 June
Payment date Monday, 11 June
Share certificates may not be dematerialised or rematerialised during the period
Monday, 4 June 2012 and Friday, 8 June 2012, both days inclusive.
On Monday, 11 June 2012 the cash dividend will be electronically transferred to
the bank accounts of all certificated shareholders where this facility is
available. Where electronic fund transfer is not available or desired, cheques
dated 11 June 2012 will be posted on that date. Shareholders who have
dematerialised their share certificates will have their accounts at their CSDP
or broker credited on Monday, 11 June 2012.
PRESENTATION
Shareholders are advised that a presentation to various analysts and investors
which provides additional analysis and information will be available on the
group`s website at www.tsogosun.com.
MN von Aulock RB Huddy
Chief Executive Officer Chief Financial Officer
17 May 2012
NOTES TO THE REVIEWED FINANCIAL STATEMENTS
1. BASIS OF PREPARATION
The condensed consolidated reviewed annual financial statements for the year
ended 31 March 2012 have been prepared in accordance with the recognition and
measurement criteria of International Financial Reporting Standards ("IFRS"),
IAS 34: Interim Financial Reporting, AC 500 Standards as issued by the
Accounting Practices Board or its successor and the requirements of the
Companies Act of South Africa. CFO, RB Huddy CA(SA), supervised the preparation
of the condensed consolidated annual financial statements. The accounting
policies are consistent with IFRS as well as those applied in the most recent
audited annual financial statements as at 31 March 2011. The condensed
consolidated reviewed annual financial statements should be read in conjunction
with the annual financial statements for the year ended 31 March 2011, which
have been prepared in accordance with IFRS. This report has been reviewed by the
group`s auditors, PricewaterhouseCoopers Inc. This review has been conducted in
accordance with International Standards on Review Engagements 2410, "Review of
Interim Financial Information Performed by the Independent Auditor of the
Entity", and their unmodified review opinion is available for inspection at the
company`s registered office. In terms of IAS 19: Employee Benefits, a provision
relating to long service awards of R106 million (2011: R88 million, 2010: R55
million) has been recognised in the balance sheet as at 31 March 2012. The
cumulative impacts for 2011 and 2010 on retained earnings of R62 million and R39
million respectively, non-controlling interests R2 million and R1 million
respectively, and deferred tax R24 million and R15 million respectively, have
been restated and the operating profit and tax adjusted accordingly.
2. BUSINESS COMBINATIONS AND TRANSACTIONS WITH MINORITIES
Dilution of 15% control in Tsogo Sun Emonti (Pty) Limited
A subsidiary of the group, Tsogo Sun Emonti (Pty) Limited, issued additional
shares to Black Economic Empowerment ("BEE") non-controlling interests with
effect from 26 September 2011 for nil consideration. The benefit was accounted
for in accordance with IFRS 2: Share-based Payment and the intangible asset was
capitalised as the costs are directly attributable to the re-awarding of the
casino licence. This effectively diluted the group`s interest from 80% to 65%.
Additional 16.5% control in Tsogo Sun KwaZulu-Natal (Pty) Limited
The group has, with effect from 26 November 2011, acquired an additional 27.5%
interest in a subsidiary, Ripple Effect 31 (Pty) Limited for R510 million, which
gives the group 100% interest in Ripple Effect and an additional acquired
effective 16.5% interest in Tsogo Sun KwaZulu-Natal (Pty) Limited, also a
subsidiary of the group. This acquisition gives the group an effective 90%
interest in the Suncoast Casino.
Hotel Formula 1 (Pty) Limited acquisition
With effect from 29 March 2012, the group acquired an additional 52.6% effective
interest in Hotel Formula 1 (Pty) Limited resulting in an effective ownership of
100% for a cash consideration of R300 million. This consideration comprised R287
million net asset value (provisional fair value) and goodwill arising of R251
million. The goodwill is attributable to the acquired customer base and expected
future growth of the business. Due to the date of the acquisition being 29 March
2012 there were no contributed revenues nor profit to the group during the year
under review, other than the share of profits as an associate until the date of
acquisition. Had the acquisition occurred on 1 April 2011, group revenue would
have increased by R112 million and profit after tax would have increased by R11
million excluding the funding impact of the acquisition.
3. SEGMENT INFORMATION
In terms of IFRS 8: Operating Segments the chief operating decision-maker has
been identified as the group`s board of directors. The board reviews the group`s
internal reporting in order to assess performance and allocate resources.
Management has determined the operating segments based on the reports reviewed
by the group`s board of directors at the board meetings which are used to make
strategic decisions.
The board considers the business from both a geographical basis and business
type, being hotels and gaming. All gaming segments and the South African hotels
division conduct business in South Africa, with the offshore hotels division
having operations in other African countries, the Middle East and the
Seychelles. Other gaming operations consist mainly of the Sandton Convention
Centre. The corporate segment includes the treasury and management function of
the group, together with the group`s captive insurance operations.
Although the offshore hotels segment does not meet the quantitative thresholds
of IFRS 8, management has concluded that the segment should be reported
separately as it has a different risk and reward profile. It is closely
monitored as it is expected to materially contribute to group revenue in the
future.
The reportable segments derive their revenue and income from hotel and gaming
operations.
The group`s board of directors assesses the performance of the operating
segments based on a measure of EBITDAR. The measure excludes the effects of
long-
term incentives and the effects of non-recurring expenditure such as rebranding
and preopening expenses. The measure also excludes all headline adjustments,
impairments and fair value adjustments on non-current assets and liabilities.
Interest income and finance costs are not included in the result for each
operating segment as this is driven by the group treasury function which manages
the cash and debt position of the group.
All revenue and income from hotel and gaming operations shown below is derived
from external customers. No one customer contributes more than 10% to the
group`s total revenue.
CONDENSED CONSOLIDATED INCOME STATEMENT
for the year ended 31 March
Reviewed Restated
Change 2012 2011
% Rm Rm
Net gaming win 61 6 111 3 804
Rooms revenue 1 615 1 591
Food and beverage revenue 752 677
Other revenue 553 415
Income 39 9 031 6 487
Gaming levies and value added tax (1 248) (773)
Property and equipment rentals (239) (211)
Amortisation and depreciation (623) (447)
Employee costs (2 116) (1 467)
Other operating expenses (1 787) (2 137)
Operating profit 108 3 018 1 452
Interest income 49 24
Finance costs (469) (415)
Share of profit of associates and joint
ventures 10 79
Profit before income tax 129 2 608 1 140
Income tax expense (761) (431)
Profit for the year 161 1 847 709
Profit attributable to:
Equity holders of the company 1 717 583
Non-controlling interests 130 126
1 847 709
Number of shares in issue (million) 1 097 1 097
Weighted number of shares in issue (million) 1 097 906
Basic and diluted earnings per share (cents) 143 156.5 64.3
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 March
Reviewed Restated
2012 2011
Rm Rm
Profit for the year 1 847 709
Other comprehensive income for the year, net of tax 23 6
Cash flow hedges (25) 42
Currency translation adjustments 43 (24)
Close out of cash flow hedge (2) -
Income tax relating to components of other comprehensive
income 7 (12)
Total comprehensive income for the year 1 870 715
Total comprehensive income attributable to:
Equity holders of the company 1 739 589
Non-controlling interests 131 126
1 870 715
SUPPLEMENTARY INFORMATION
for the year ended 31 March
Reviewed Restated
Change 2012 2011
% Rm Rm
Reconciliation of earnings attributable to
equity holders of the company to headline
earnings and adjusted earnings#
Earnings attributable to equity holders of
the company 1 717 583
Gain on disposal of property, plant and equipment (2) (5)
Impairment of plant and equipment - 8
Impairment of investment in joint venture 2 -
Fair value (gain)/ loss on revaluation of associates (179) 299
Headline earnings 1 538 885
Write-back of contingent purchase consideration (248) -
Gold Reef transaction costs (including associate
costs) - 83
Other exceptional items 43 15
Adjusted headline earnings 36 1 333 983
Number of shares in issue (million) 1 097 1 097
Weighted number of shares in issue (million) 1 097 906
Basic and diluted HEPS (cents) 140.2 97.7
Basic and diluted adjusted HEPS (cents) 12 121.5 108.5
# Adjustments net of tax and non-controlling
interests.
The prior year`s basic and diluted earnings
and headline earnings per share declined by
2.6 cents as a result of the restatement.
Reconciliation of operating profit to EBITDAR
Group EBITDAR pre-exceptional items is made
up as follows:
Operating profit 3 018 1 452
Add:
Property rentals 190 171
Amortisation and depreciation 623 447
Long-term incentive expense /(credit) 55 (13)
3 886 2 057
(Less)/Add: Exceptional (profits)/ losses (385) 420
Gain on disposal of property, plant and equipment (3) (6)
Gold Reef transaction costs - 93
Fair value (gain)/ loss on revaluation of
associates (179) 299
Write-back of contingent purchase
consideration (248) -
Other adjustments 45 34
EBITDAR 41 3 501 2 477
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
for the year ended 31 March
Reviewed Restated
2012 2011
Rm Rm
Cash flow from operating activities
Profit before interest and income tax 3 018 1 452
Non-cash movements 485 906
Increase in working capital (107) (70)
Cash generated from operations 3 396 2 288
Interest received 46 25
Interest paid (501) (418)
2 941 1 895
Income tax paid (785) (464)
Dividends received 5 57
Dividends paid to shareholders (768) -
Dividends paid to non-controlling interests (48) (23)
Net cash generated from operations 1 345 1 465
Cash flows from investment activities
Purchase of property, plant and equipment (692) (306)
Proceeds from disposals of property, plant and equipment 10 13
Purchase of intangible assets (44) (29)
Acquisition of subsidiaries, net of cash acquired (278) 479
Other loans and investments 5 (7)
Net cash (used for)/generated by investment activities (999) 150
Cash flows from financing activities
Borrowings raised 1 152 1 000
Borrowings repaid (594) (2 076)
Loan repayments by/(to) non-controlling interests 98 (2)
Acquisition of non-controlling interests (509) (1)
Part settlement of contingent consideration for
Millennium acquisition (24) -
Increase in amounts due by share scheme participants (1) -
Net cash generated from /(utilised in) financing
activities 122 (1 079)
Net increase in cash and cash equivalents 468 536
Cash and cash equivalents at beginning of year 956 425
Foreign currency translation 19 (5)
Cash and cash equivalents at end of year 1 443 956
CONDENSED CONSOLIDATED BALANCE SHEET
as at 31 March
Reviewed Restated Restated
2012 2011 2010
Rm Rm Rm
ASSETS
Non-current assets
Property, plant and equipment 8 568 8 099 5 583
Goodwill and other intangible assets 6 342 6 077 1 676
Investments in associates and joint ventures 170 249 1 710
Non-current receivables 54 152 135
Deferred income tax assets 114 123 127
Derivative financial instruments - 18 -
Amounts due by share scheme participants 19 17 -
15 267 14 735 9 231
Current assets
Inventories 176 171 130
Trade and other receivables 407 383 285
Current income tax assets 82 62 -
Cash and cash equivalents 1 443 956 514
2 108 1 572 929
Total assets 17 375 16 307 10 160
EQUITY
Capital and reserves attributable to equity
holders of the company
Ordinary share capital and premium 4 754 4 751 1 074
Share-based payment reserve 3 2 -
Surplus arising on change in control in
joint venture 130 130 130
Other reserves (230) 13 7
Retained earnings 3 063 2 115 1 532
Total shareholders` equity 7 720 7 011 2 743
Non-controlling interests 727 862 624
Total equity 8 447 7 873 3 367
LIABILITIES
Non-current liabilities
Interest-bearing borrowings 4 245 3 866 3 357
Derivative financial instruments 9 - 19
Deferred income tax liabilities 1 517 1 470 247
Provisions and other liabilities 449 710 698
6 220 6 046 4 321
Current liabilities
Interest-bearing borrowings 1 382 1 244 1 624
Derivative financial instruments 38 72 53
Trade and other payables 958 799 634
Current income tax liabilities 61 81 40
Provisions and other liabilities 269 192 121
2 708 2 388 2 472
Total liabilities 8 928 8 434 6 793
Total equity and liabilities 17 375 16 307 10 160
CONDENSED STATEMENT OF CHANGES IN EQUITY
Attributable to equity holders of the company
Surplus
arising
on control
Ordinary share Share-based change in
capital and payment in joint Other
premium reserve venture reserves**
Rm Rm Rm Rm
Balance at 1 April 2010 as
previously reported 1 074 - 130 7
Recognition of long service awards - - - -
Restated balance at 1 April
2010 (reviewed) 1 074 - 130 7
Total comprehensive income for
the year - - - 6
Share capital and premium
arising on reverse acquisition 3 677 - - -
Non-controlling interests share
of property brought into use - - - -
Non-controlling interests
recognised on reverse acquisition - - - -
Recognition of share-based payments - 2 - -
Release of reserve - - * -
Acquisition of non-controlling
interests - - - -
Repayment of non-controlling
interests` equity loans - - - -
Ordinary dividends - - - -
Restated balance at 1 April
2011 (reviewed) 4 751 2 130 13
Total comprehensive income for
the year - - - 22
Shares issued to share trust 35 - - -
Shares issued by subsidiary
taken up by non-controlling
interests - - - -
Non-controlling interests
arising on business combinations - - - -
Recognition of share-based
payments - 1 - -
Release of reserve - - * -
Repayment of non-controlling
interests` equity loans - - - -
Treasury shares held by share
trust (32) - - -
Acquisition of non-controlling
interests - - - (265)
Ordinary dividends - - - -
Balance at 31 March 2012
(reviewed) 4 754 3 130 (230)
Retained Non-controlling Total
earnings Total interests equity
Rm Rm Rm Rm
Balance at 1 April 2010 as
previously reported 1 571 2 782 625 3 407
Recognition of long service awards (39) (39) (1) (40)
Restated balance at 1 April 2010
(reviewed) 1 532 2 743 624 3 367
Total comprehensive income for
the year 583 589 126 715
Share capital and premium arising
on reverse acquisition - 3 677 - 3 677
Non-controlling interests share of
property brought into use - - 93 93
Non-controlling interests
recognised on reverse acquisition - - 45 45
Recognition of share-based payments - 2 - 2
Release of reserve - * * *
Acquisition of non-controlling
interests - - (1) (1)
Repayment of non-controlling
interests` equity loans - - (2) (2)
Ordinary dividends - - (23) (23)
Restated balance at 1 April 2011
(reviewed) 2 115 7 011 862 7 873
Total comprehensive income for the
year 1 717 1 739 131 1 870
Shares issued to share trust - 35 - 35
Shares issued by subsidiary taken
up by non-controlling interests - - 20 20
Non-controlling interests arising
on business combinations - - 7 7
Recognition of share-based payments - 1 - 1
Release of reserve * - - -
Repayment of non-controlling
interests` equity loans - - (1) (1)
Treasury shares held by share trust - (32) - (32)
Acquisition of non-controlling
interests - (265) (244) (509)
Ordinary dividends (769) (769) (48) (817)
Balance at 31 March 2012 (reviewed) 3 063 7 720 727 8 447
*Less than R1 million.
**Comprises cash flow hedge reserve, foreign currency translation reserve and
transactions with non-controlling interests.
SEGMENTAL ANALYSIS
Income EBITDAR(1)
2012 2011 2012 2011
Reviewed Audited Reviewed Restated
Rm Rm Rm Rm
Montecasino 2 107 1 964 901 790
Suncoast 1 313 1 261 634 607
Gold Reef City 1 162 87 462 14
Silverstar 557 51 207 14
The Ridge 357 332 171 160
Emnotweni 292 268 130 114
Golden Horse 287 23 144 9
Hemingways 285 269 122 116
Garden Route 155 12 70 4
Goldfields 131 11 59 4
Blackrock 123 108 48 38
Caledon 123 120 36 34
Mykonos 120 9 52 2
Other gaming operations 101 115 (150) (73)
Total gaming operations 7 113 4 630 2 886 1 833
South African hotels division (2) 1 625 1 617 512 560
Offshore hotels division 324 271 101 68
Pre-foreign exchange gains
/(losses) 88 75
Foreign exchange gains /(losses) 13 (7)
Corporate (31) (31) 2 16
Group 9 031 6 487 3 501 2 477
Amortisation
EBITDAR margin and depreciation
2012 2011 2012 2011
Reviewed Restated Reviewed Audited
% % Rm Rm
Montecasino 42.8 40.2 86 101
Suncoast 48.3 48.1 98 94
Gold Reef City 39.8 16.1 85 7
Silverstar 37.2 27.5 53 5
The Ridge 47.9 48.2 26 23
Emnotweni 44.5 42.5 17 16
Golden Horse 50.2 39.1 32 3
Hemingways 42.8 43.1 19 17
Garden Route 45.2 33.3 13 1
Goldfields 45.0 36.4 11 1
Blackrock 39.0 35.2 12 9
Caledon 29.3 28.3 8 11
Mykonos 43.3 22.2 8 1
Other gaming operations 11 13
Total gaming operations 40.6 39.6 479 302
South African hotels division (2) 31.5 34.6 129 134
Offshore hotels division 31.2 24.9 12 8
Pre-foreign exchange gains
/(losses) 27.2 27.6
Foreign exchange gains /(losses)
Corporate 3 3
Group 38.8 38.2 623 447
(1) All casino units are reported pre-internal gaming management fees.
(2) Includes R31 million (2011: R31 million) intergroup management fees.
Note: In order to improve reporting of segments as reviewed by the chief
operating decision-maker all gaming precincts have been disclosed separately.
DIRECTORS: JA Copelyn (Chairman)* JA Mabuza (Deputy Chairman)* MN von Aulock
(Chief Executive Officer) RB Huddy (Chief Financial Officer) MJA Golding*
JM Kahn* EAG Mackay* VE Mphande* JG Ngcobo** Y Shaik** RG Tomlinson (Lead
Independent)** A van der Veen* MI Wyman*# (*Non-executive Director **Independent
Director British#)
COMPANY SECRETARY: WJ van Wyngaardt
REGISTERED OFFICE: Palazzo Towers East, Montecasino Boulevard, Fourways, 2055
(Private Bag X200, Bryanston, 2021)
TRANSFER SECRETARIES: Link Market Services South Africa (Proprietary) Limited,
13th Floor, Rennie House, 19 Ameshoff Street, Braamfontein, 2001
(PO Box 4844, Johannesburg, 2000)
SPONSOR: Deutsche Securities (SA) (Proprietary) Limited
3 Exchange Square, 87 Maude Street, Sandton, 2196
(Private Bag X9933, Sandton, 2146)
Johannesburg
17 May 2012
Date: 17/05/2012 07:05:02 Produced by the JSE SENS Department.
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