Interim Results - Part 1
August 30 2001 - 3:00AM
UK Regulatory
RNS Number:0810J
NMBZ Holdings Ld
30 August 2001
PART ONE
Holding company of
NMB Bank Limited
(registered Commercial Bank)
and
Continental Securities Trading (Private) Limited
INFLATION ADJUSTED AND HISTORICAL
RESULTS FOR THE HALF YEAR ENDED 30 JUNE 2001
HIGHLIGHTS
* Profit before tax up 102.1% to Z$952.0 million (2000 - Z$471.0 million)
* Restated attributable profit up 27.0% to Z$447 million (2000 - Z$352.0
million)
* Historical attributable profit up 122.3% to Z$745.0 million (2000 - Z$335.2
million)
* Net operating income up 70.0% to Z$1 862.0 million (2000 - Z$1 095.3 million)
* Total asset base up 121.3% to Z$18 845.7 million (2000 - Z$8 516.5 million)
* Dividend per share of 343.0 cents (2000 - 412.2 cents)
* Cost to income ratio down 24.3% to 25.9% (2000 - 34.2%)
Mr Paddy Zhanda, Chairman, said:
"I am delighted to report the successful launch of commercial banking services
in August last year and the significant growth of the Group's asset base. The
Group also continued to achieve real profitability after adjusting the results
for inflation despite the unfavourable economic environment. I am confident
that the Group can achieve commendable results during the second half".
Enquiries:
NMBZ HOLDINGS LIMITED Tel: +263-4-759 601/6
Dr Julius Makoni, Managing Director
James Mushore, Deputy Managing Director
Otto Chekeche, Finance Director
SG SECURITIES (LONDON) LIMITED Tel: +44-207-638 9000/5699
James Harris/Andrew Dawber
COLLEGE HILL - LONDON Tel: +44-207-457 2020
Corrina Dorward/Matthew Gregorowski
CHAIRMAN'S STATEMENT
The difficulties experienced by the business sector in 2000 persisted during the
first half of 2001. The major macro-economic challenges facing the country
during the period were:
* Decline in GDP growth in 2001
* Hyperinflation and high money supply growth
* Weak balance of payment position
* Foreign currency shortages
* Negative publicity associated with the land re-distribution exercise and
Parliamentary by-elections
Positive factors during the period were:
* Concessional schemes for exporters and producers
* Positive fiscal performance
ECONOMIC REVIEW
Decline in GDP Growth in 2001
The worsening foreign exchange crisis, decline in national savings, and a
shrinking domestic market continued to hamper the economy's productive capacity
in 2001 despite the introduction of various incentive schemes. The country's
overall output is expected to decrease by a further 6.5% in 2001 compared to an
estimated decline in real GDP of 4.2% in 2000. Major reductions are expected in
agriculture (16.5%), mining (6.4%), manufacturing (7.5%) and construction
(3.5%).
Hyperinflation and High Money Supply Growth
Efforts to re-direct the economy continue to be hampered by the continued rise
in inflation. Inflation, which ended the year 2000 at 55.2%, had risen to 64.4%
by June 2001. This upward trend, driven by sharp increases in fuel prices, the
cost-push effect of high parallel market foreign exchange rates, and continuous
food price hikes, is expected to persist during the remainder of the year. A
concerted policy thrust aimed at addressing the root causes of inflation is
necessary for any economic recovery strategy in Zimbabwe.
Excessive growth in money supply remains a major cause of the country's rising
inflation. Annual growth in broad money supply, M3, which closed the year 2000
at 59.9%, surged to 68.3% in March 2001. This trend is expected to continue
against the background of negative real interest rates thereby undermining the
country's savings capacity, as well as the general purchasing power of household
incomes.
Weak Balance of Payments (BOP) Position
The country's BOP position remains poor, fuelled by the continued decline in
exports and cessation of offshore lines of credit.
Merchandise exports are estimated to have declined by 5.4% in 2000 and are
forecast to contract by 3.1% in 2001, with mining declining by an estimated 9.5%
and pure manufactures by 4.5%.
The foreign exchange crisis is expected to continue, with merchandise imports
forecast to shrink by a further 3.0% in 2001 after declining by an estimated
9.3% in 2000.
A current account deficit of US$350 million is forecast in 2001, compared to an
estimated deficit of US$210 million in 2000.
On the capital account, a deficit of US$209 million is forecast in 2001, against
an estimated deficit of US$401 million in 2000. This was driven by the decrease
in foreign direct investment inflows, as well as donor fatigue and withdrawal of
the multilateral lending institutions in supporting the economy's balance of
payments. The overall balance of payments deficit is estimated at US$559
million in 2001, compared to an estimated deficit of US$611 million recorded in
2000.
Foreign Exchange Market and Exchange Rate Policy
Despite persistently high inflation during the first half of the year, the
official exchange rate remained static at Z$55 to the US dollar. This
development has eroded the viability of most exporting businesses, particularly
those in manufacturing and agriculture. The start of the tobacco selling season
did not generate significant foreign exchange inflows as farmers withheld their
crop in anticipation of a devaluation.
The emergence of a vibrant parallel market emphasises the need for a clear and
predictable exchange rate management policy if the country is to overcome the
current crisis. The monthly foreign exchange inflows of under US$60 million
registered during the first half is insufficient to halt the economy's decline
into a recession.
The move by Government to grant a US$343/oz floor price at the official exchange
rate to gold producers in order to restore viability in the mining industry
should be broadened to encompass other equally deserving exporting sectors.
Concessional Financing Schemes for Exporters and Producers
In January 2001, the Reserve Bank of Zimbabwe (RBZ), introduced the Export and
Productive Sector Financing facilities through the release of banks' statutory
reserves for on-lending to exporters and other producers at rates of 15% and 30%
per annum respectively. Exporters and other producers accessed in excess of
Z$15 billion between February and June 2001 for working capital purposes. This
move reduced banks' average cost of funds and accordingly lending rates dropped
from approximately 60% in 2000 to approximately 45% during the first half of
2001.
The country is yet to reap the full benefits of this initiative, as the expected
supply response has not materialised, due to the lack of foreign exchange for
both imported raw materials and capital equipment. The negative real interest
rate environment, however, whilst benefiting borrowers, has become a hindrance
for an effective mobilisation of savings, due to the negative returns on
deposits arising from high inflation.
Positive Fiscal Performance
The Government recorded a positive performance on the fiscal budget during the
first half on a cash accounting basis. Total expenditure over the four months
to April 2001 was estimated at 34% below budget. This positive performance was
due to the introduction of the cash budgeting system in line ministries, as well
as accumulation of arrears on external payments as a result of foreign exchange
shortages.
Fiscal revenue under-performed by 6%, reflecting the harsh economic environment.
The resultant fiscal deficit (excluding grants) of Z$12 billion was wholly
financed from domestic sources, in the absence of any foreign lines of credit.
Impending food production deficits, fuel price increases as well as
inflation-driven wage adjustments are expected to weaken the fiscal position
further in the foreseeable future.
THE ZIMBABWE STOCK EXCHANGE
The stock market performed strongly during the first six months. The industrial
index increased by 123% as investors responded to the fall in interest rates.
Several initial public offerings brought increased activity on the Zimbabwe
Stock Exchange and the listings experienced unprecedented levels of over
subscription. Continuing negative returns on the money market are expected to
sustain trading activity on the stock market. This should benefit the operations
of the stockbroking subsidiary.
GROUP INFLATION ADJUSTED RESULTS
Introduction
The difficult economic environment affected some income streams severely. Pegged
interest rates, despite a highly inflationary environment, foreign currency
shortages and a shortage of offshore lines of credit all had an impact on the
business. However, lending growth for the period was strong as the commercial
bank attracted deposits for on lending and export and productive sector
facilities were made available by the Reserve Bank. The focus has also been on
controlling costs and containing the cost income ratio, which is at 25.9%,
(2000 - 34.2%).
The Group achieved inflation adjusted profits before tax of Z$952 million, an
increase of 102.1% over the adjusted result for the same period last year.
Attributable profit after tax was Z$447 million an increase of 27% over the same
period last year. The return on shareholders' funds was 24.7% (June 2000 -
19.8%), an improvement despite worsening market conditions. The effective tax
rate for the six months ended 30 June 2001 is 51.1% compared to 24.4% for the
six months ended 30 June 2000 and 44.8% for the year ended 31 December 2000.
The effective tax rate is higher compared to prior periods as the current period
did not benefit from assessed tax losses and a comparatively higher monetary
loss was recorded.
Compliance with International Accounting Standards
The results have been prepared in accordance with International Accounting
Standards in particular IAS 39 (Revised 2000), Financial Instruments:
Recognition and Measurement, which became effective for periods beginning 1
January 2001. The comparative figures for the previous periods have been
similarly restated in accordance with IAS 29, Financial Reporting in
Hyperinflationary Economies. The commentary is based on the restated figures.
Net Interest Income
Net interest income was Z$1 051 million an increase of 372.9% over the same
period last year. Net interest income represents 56.5% of net operating income
as the bank was able to attract deposits for on-lending at competitive rates. In
addition, lendings grew as clients accessed the cheaper statutory reserve funds
offered by the RBZ through the export and productive sector facilities. Lending
to the agricultural sector continued to be low due to the disruptions associated
with the land redistribution programme. Income earned on the money market
increased significantly due to attractive margins earned on treasury bills
purchased before the fall in interest rates at the beginning of the year.
Non-Interest Income
Non-interest income decreased by 7.1% to Z$811 million and contributed 43.6%
(2000 - 79.7%) of net operating income. The decrease is mainly as a result of a
foreign currency shortage within the market.
Foreign exchange gains decreased by 33.8% compared to the same period last year
as a result of decreased foreign currency trading volumes.
The stockbroking subsidiary, Continental Securities Trading (Private) Limited,
contributed positively during the six months due to the bull run experienced on
the Zimbabwe Stock Exchange.
Operating Expenses
Operating expenditure increased by 28.6% over the same period last year. Staff
costs, advertising and computer related costs grew in line with the increase in
the staff complement, staff retention strategies and the expanding commercial
banking services. The 24.3% reduction in the cost income ratio from 34.2% last
year to 25.9% reflects the Group's cost control initiatives in the face of the
expanding commercial banking services.
Charge for Doubtful Debts
The charge for the six month period increased by 40.2% compared to the same
period last year. The Board continues to adopt a conservative approach on
provisions in view of the unstable economic environment.
Dividend
An interim dividend of 343.0 cents per share on 29 713 650 shares has been
declared payable to members registered in the books of the company on 13
September 2001. The dividend cover has been increased to 4.39 times (June
2000-3 times) inter-alia to fund the expansion of the commercial bank.
BALANCE SHEET
The asset base grew by 121.3% to Z$18 845.7 million from Z$8 516.5 million at 30
June 2000. The increase is mainly due to deposits and other accounts which have
increased by 247.7% from Z$3 161.7 million at 30 June 2000 to Z$10 991.4 million
as at 30 June 2001. The Group has been able to attract a large deposit base
since the inception of the commercial banking services to support its banking
activities.
CAPITAL ADEQUACY
The banking subsidiary's capital adequacy ratio at 30 June 2001 calculated on
the historical cost basis in accordance with the guidelines of the RBZ was
13.59% (30 June 2000 - 24.73%, 31 December 2000 - 21.09%). This compares
favourably with the RBZ minimum ratio of 10%. This decrease is as a result of
the expansion of lending book following the reduction of the lending rates due
to the concessional financing schemes for exporters and producers.
OUTLOOK
Economy
The economic review above to some extent paints a depressing outlook for the
country's economy. Reversal of this trend requires a common effort encompassing
not only the fiscal and monetary policy aspects, but also the business
community. On the part of corporates, adoption of cost-effective service
delivery systems should take overriding consideration in their future plans. The
current impasses on the exchange rate, excessive growth in money supply, and
fortuitous containment of fiscal deficits, have to be dealt with resolutely if
the economy is to realise a quicker turn-around.
Group
The Group's aim is to remain a leading financial services provider focusing on
corporates and high net worth individuals. Innovative products and
technology-enabled delivery channels continue to be introduced as part of the
strategy to meet the ever increasing needs of our target market.
The Group continues to identify and exploit opportunities offered by the
depressed operating environment. A strong pipeline exists on advisory services,
some of which are expected to be realised during the second half of the year.
The stockmarket may remain bullish due to the negative interest returns on the
money market. This should create further opportunities for the stockbroking
subsidiary as well as other equity portfolio dealings. The Group is confident
that it can achieve commendable results during the second half.
Management continue to seek ways to improve liquidity of the Company's shares on
the Zimbabwe Stock Exchange.
CONCLUSION
I would like to thank our clients for their continued invaluable support. I
would also like to thank the board, staff and management for achieving positive
results under difficult economic conditions.
PADDY TENDAYI ZHANDA
Chairman
28 August 2001
UNAUDITED INFLATION ADJUSTED GROUP RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
Income Statement
Unaudited
Unaudited Restated Restated
6 months 6 months Year
ended ended ended
NOTE 30 June 2001 30 June 2000 31 Dec 2000
Z$'000 Z$'000 Z$'000
Interest from lending
activities 364 791 214 005 521 244
Charge for bad and
doubtful debts (176 785) (126 095) (108 365)
188 006 87 910 412 879
Interest from investing
activities 1 177 908 261 119 795 870
1 365 914 349 029 1 208 749
Interest expense (314 839) (126 772) (283 756)
Net interest income 1 051 075 222 257 924 993
Foreign exchange gains 205 943 311 211 435 027
Net dealing income from
securities 184 607 271 402 568 449
Other income 6 420 400 290 425 208 620
Net operating income 1 862 025 1 095 295 2 137 089
Operating expenditure 7 (481 685) (374 624) (715 633)
Loss on net monetary position (428 362) (249 684) (522 746)
Profit before taxation 951 978 470 987 898 710
Taxation (486 487) (114 872) (402 994)
Profit after taxation 465 491 356 115 495 716
Outside shareholders'
interests (18 587) (4 066) (5 524)
Profit attributable to
ordinary shareholders 446 904 352 049 490 192
Dividend per share (cents) 343.0 412.2 907.9
Historical cost basis
- interim proposed 343.0 250.7 250.7
- final proposed - - 356.3
Restatement in respect of
adopting IAS 29 - 161.5 300.9
Earnings per share (cents) 8 1 551.9 1 236.7 1 721.7
Headline earnings per share
(cents) 1 537.8 1 236.8 1 719.8
Diluted earnings per share
(cents) 1 551.9 1 220.8 1 681.4
Diluted headline earnings per
share (cents) 1 537.8 1 220.8 1 679.6
Dividend cover (times) 4.39 3.00 1.89
Number of issued shares (000's) 29 714 28 466 28 614
UNAUDITED INFLATION ADJUSTED GROUP RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
Balance Sheet
Unaudited
Unaudited Restated Restated
30 June 30 June 31 Dec
2001 2000 2000
Z$'000 Z$'000 Z$'000
Share capital 586 260 581 373 582 096
Capital reserves 1 275 161 1 190 899 1 194 947
Revenue reserves 343 081 19 057 33 978
2 204 502 1 791 329 1 811 021
Minority Interest 49 691 32 760 32 126
2 254 193 1 824 089 1 843 147
Liabilities
Deferred taxation 262 973 29 209 280 607
Deposit and other accounts:
- held for trade 5 430 655 1 897 046 2 413 051
- at restated values 5 560 705 1 264 697 1 489 252
Provision for current taxation 454 347 159 656 161 018
Acceptances 4 882 874 3 341 760 4 148 380
18 845 747 8 516 457 10 335 455
Assets
Balances with banks and cash 357 409 43 201 622 343
Government and public sector
securities
- held for trade 3 689 734 1 135 439 1 335 352
Advances and other accounts
- at book value 4 684 206 2 379 995 2 582 908
Investments:
Trade investment
- at book value 36 988 27 471 17 129
Short term investments
- held for trade 3 241 703 10 990 545 667
Other - held for trade 1 029 663 814 828 222 792
Fixed assets 923 170 762 773 860 884
Customers' indebtedness
for acceptances 4 882 874 3 341 760 4 148 380
18 845 747 8 516 457 10 335 455
UNAUDITED INFLATION ADJUSTED GROUP RESULTS & DIVIDEND ANNOUNCEMENT
STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2001
Revenue
Reserves
Restated Restated
Restated Capital Accum-
Restated Restated Statu- Redemp- ulated
Share Share tory tion Restated Profit/
Capital Premium Reserve Reserve Other (Loss) Total
Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000
Balances
at 1
January
2000 99 630 172 149 22 500 27 921 675 288 880 611 755
Effects of
adopting
IAS 10 - - - - - 250 189 250 189
Effects of
adopting
IAS 29 481 743 739 681 142 265 84 665 1 043 (754 712) 694 685
As
restated
at 1
January
2000 581 373 911 830 164 765 112 586 1 718 (215 643) 1 556 629
Net profit
for the
period - - - - - 352 049 352 049
Dividends - - - - - (117 349) (117 349)
Balances
at 30
June 2000 581 373 911 830 164 765 112 586 1 718 19 057 1 791 329
Balances
at 1 July
2000 581 373 911 830 164 765 112 586 1 718 19 057 1 791 329
Shares
issued
12
December
2000 723 4 048 - - - - 4 771
Net profit
for the
period - - - - - 138 143 138 143
Dividends - - - - - (123 222) (123 222)
Balances
at 31
December
2000 582 096 915 878 164 765 112 586 1 718 33 978 1 811 021
Balances
at 1
January
2001 582 096 915 878 164 765 112 586 1 718 33 978 1 811 021
Effects
of
adopting
IAS 39 - - - - - (17 728) (17 728)
As restated
at 1
January
2001 582 096 915 878 164 765 112 586 1 718 16 250 1 793 293
Shares
issued
May 4 164 80 214 - - - - 84 378
Net profit
for the
period - - - - - 446 904 446 904
Dividends - - - - - (120 073) (120 073)
Balances
at 30
June 2001 586 260 996 092 164 765 112 586 1 718 343 081 2 204 502
UNAUDITED INFLATION ADJUSTED GROUP RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
Cashflow Statement
Unaudited
Unaudited Restated Restated
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2001 2000 2000
Z$'000 Z$'000 Z$'000
Operating cash flow before changes
in operating assets and liabilities
and loss on net monetary position 1 585 679 717 142 1 597 121
Loss on monetary position (428 362) (249 684) (522 746)
1 157 317 467 458 1 074 375
Operating cash flow before changes
in operating assets and liabilities
Changes in operating assets and
liabilities:
Deposits and other accounts 7 089 057 (1 318 985) (583 465)
Advances and other accounts (2 355 158) 241 114 (67 214)
5 891 215 (610 413) 423 696
Net interest received on
government & public sector
securities 5 888 - 54 112
Dividends paid (121 095) (297 240) (453 951)
Corporate tax paid (125 791) (136 571) (146 241)
Net cash outflow from investing
activities (949 113) (906 740) (551 897)
Net cash inflow/(outflow) before
financing activities 4 701 105 (1 950 965) (674 281)
Net cash inflow from
financing activities 84 378 - 3 432
Cash and cash equivalents
at beginning of period 2 479 197 3 150 046 3 150 046
Cash and cash equivalents
at end of period 7 264 680 1 199 081 2 479 197
Cash and cash equivalents comprise cash and bank balances, treasury bills
included in Government and public sector securities and short-term investments.
UNAUDITED INFLATION ADJUSTED GROUP RESULTS AND DIVIDEND ANNOUNCEMENT
RESTATED SEGMENT RESULT
for the six months ended 30 June 2001
06/01 06/00 12/00 06/01 06/00 12/00
Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000
REVENUE
External
interest
and
other
revenue 256 713 - 65 864 1 605 312 1 095 295 2 071 225
Total
revenue 256 713 - 65 864 1 605 312 1 095 295 2 071 225
RESULT
Operating
profit
before
unallocated
expenses 118 570 - (3 596) 1 261 770 720 671 1 425 052
Unallocated
Corporate
Expenses:
Income
taxes
Loss
on net
monetary
position
Minority
interest
Profit
attributable
to
ordinary
shareholders
06/01 06/00 12/00
Z$'000 Z$'000 Z$'000
REVENUE
External interest and other revenue 1 862 025 1 095 295 2 137 089
Total revenue 1 862 025 1 095 295 2 137 089
RESULT
Operating profit before unallocated
expenses 1 380 340 720 671 1 421 456
Unallocated Corporate
Expenses:
Income taxes (486 487) (114 872) (402 994)
Loss on net monetary position (428 362) (249 684) (522 746)
Minority interest (18 587) (4 066) (5 524)
Profit attributable to ordinary
shareholders 446 904 352 049 490 192
UNAUDITED INFLATION ADJUSTED GROUP RESULTS AND DIVIDEND ANNOUNCEMENT
RESTATED SEGMENT RESULT
for the six months ended 30 June 2001
06/01 06/00 12/00 06/01 06/00 12/00
Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000
OTHER INFORMATION
Segment assets 2 818 347 301 218 620 512 16 027 400 8 215 239 9 714 943
Total assets 2 818 347 301 218 620 512 16 027 400 8 215 239 9 714 943
Segment
liabilities 2 237 250 - 242 978 13 636 984 6 503 503 7 807 705
Unallocated corporate
Liabilities
Total
liabilities 2 237 250 - 242 978 13 636 984 6 503 503 7 807 705
Capital
expenditure 464 189 301 218 344 418 484 924 22 148 118 256
Depreciation 11 171 - 34 818 52 981 24 623 87 140
06/01 06/00 12/00
Z$'000 Z$'000 Z$'000
OTHER INFORMATION
Segment assets 18,845 747 8,516 457 10 335 455
Total assets 18 845 747 8 516 457 10 335 455
Segment
liabilities 15 874 234 6 503 503 8 050 683
Unallocated corporate
Liabilities 717 320 188 865 441 625
Total liabilities 16 591 554 6 692 368 8 492 308
Capital expenditure
Depreciation
NMBZ HOLDINGS LIMITED
NOTES TO THE ACCOUNTS
1. Accounting Policies
The interim statements have been prepared on the basis of the accounting
policies set out in the financial statements for the year ended 31
December 2000.
2. Compliance with International Accounting Standards (IASs)
The Group's interim statements have been prepared in accordance with IASs
in particular IAS 39 (Revised 2000), Financial Instruments: Recognition
and Measurement which became effective for periods beginning 1 January
2001.
3. Currency
These interim statements are expressed in Zimbabwe dollars.
4. Basis of preparation
The interim report was approved by the board on 28 August 2001. The
financial information in the interim report for the six months ended 30
June 2001 has not been audited, but has been reviewed by the external
auditors, KPMG, as was the financial information for the six months ended
30 June 2000. The auditors' interim review report is available for
inspection at the company's registered office. The financial information
for the year ended 31 December 2000 has been restated based on the
audited financial statements for that period.
The financial statements have been prepared on the historical cost basis
and restated in accordance with IAS 29, which requires that the results
be stated in terms of the measuring unit current at the balance sheet
date. The index used was based on the closing index value for June 2001.
The comparative figures for the six months ended 30 June 2000 and the
financial year ended 31 December 2000 have been restated based on the
value current at 30 June 2001. The income statement for the six month
period was derived from monthly index values relative to June 2001, the
comparative income statements have been restated on average index values
for the respective periods relative to June 2001.
Indices
The indices used were compiled by the Central Statistical Office of
Zimbabwe and are based on the consumer price index which is the most
widely accepted measure of the inflation rate available.
The indices and conversion factors were as follows:
Indices Conversion factors
June 2001 765.7 1.0000
December 2000 550.4 1.3912
June 2000 465.7 1.6442
IAS 29 discourages the publication of historical results as a supplement
to inflation adjusted accounts. The Zimbabwe Accounting Practices Board
and the Zimbabwe Stock Exchange have permitted companies in Zimbabwe to
publish historical results in conjunction with inflation adjusted
results.
5. Financial Instruments
Financial instruments are carried in the balance sheet at cost or their
estimated fair values, in accordance with the provisions of IAS 39
(Revised 2000), Financial Instruments: Recognition and Measurement.
Accordingly
The fair values for 30 June 2001 were determined using appropriate
valuation models by discounting the future cash payments or receipts
using the prevailing market rates of interest for similar instruments.
No fair value adjustments have been effected in respect of prior periods.
Gains and losses arising from the recognition and measurement of the fair
value of financial assets and liabilities held for trade at 30 June 2001
have been recognised in the income statement.
6. Other income
Unaudited
Unaudited Restated Restated
6 months 6 months Year ended
ended ended 31 December
30 June 2001 30 June 2000 2000
Z$'000 Z$'000 Z$'000
Net commission and fee income 86 847 40 130 149 064
Gains less losses from quoted and
other investments 249 316 178 053 -
Broking income 76 637 27 147 34 628
Profit on disposal of fixed assets 4 055 - 547
Other operating income 3 545 45 095 24 381
420 400 290 425 208 620
7. Operating expenditure
The operating profit is after
charging the following:
Administration costs 131 107 76 138 197 814
Provision for audit fees 1 621 996 4 848
Depreciation 64 152 24 623 121 958
- Fixed assets leased
to customers 1 278 7 964 16 126
- Own assets 62 874 16 659 105 832
Directors remuneration 20 593 23 073 48 155
Paid by subsidiary companies:
- Fees for services as directors 1 022 528 1 533
- Other emoluments 19 571 22 545 46 622
Staff costs 264 212 249 794 342 858
481 685 374 624 715 633
8. Earnings per share
8.1 Basic earnings per share
The calculation of basic earnings per share for the six months
ended 30 June 2001 of 1 551.9 cents (2000 - 1 236.7 cents) is
based on the profit after taxation attributable to ordinary
shareholders of Z$446 904 000 (2000 - Z$352 049 000) and the
weighted average shares in issue of 28 797 538 (2000 -
28 465 589). The calculation of basic earnings per share for the
year ended 31 December 2000 of 1 721.7 cents is based on the
profit after tax attributable to ordinary shareholders of Z$490
192 000 and on 28 471 701 weighted average shares in issue.
8.2 Headline earnings per share
The calculation of headline earnings per share for the six months
ended 30 June 2001 of 1 537.8 cents (2000 - 1 236.8 cents) is
based on adjusted profit after taxation attributable to ordinary
shareholders of Z$442 849 000 (2000 - Z$352 049 000) and the
weighted average shares in issue of 28 797 538 (2000 -
28 465 589). The calculation of headline earnings per share for
the year ended 31 December 2000 of 1 719.8 cents is based on the
adjusted profit after tax attributable to ordinary shareholders of
Z$489 645 000 and on 28 471 701 weighted average shares in issue.
The adjustments were as follows:-
Unaudited
Unaudited Restated Restated
6 months 6 months Year ended
ended ended 31 December
30 June 2001 30 June 2000 2000
Z$'000 Z$'000 Z$'000
Profit attributable
to shareholders 446 904 352 049 490 192
Deduct non-recurring
items:
Profit on disposal
of fixed assets (4 055) - (547)
442 849 352 049 489 645
Weighted average number of
shares (000's) 28 798 28 466 28 472
The headline earnings are calculated in accordance with the
Statement of Investment Practice No.1 issued by the Institute of
Investment Management and Research to assist users of accounts
identify earnings derived from trading activities.
8.3 Diluted earnings per share
The diluted earnings per share for the six months ended 30 June
2001 is 1 551.9 cents (2000 - 1 220.8 cents). The calculation is
based on profit after taxation attributable to ordinary
shareholders of Z$446 904 000 (2000 - Z$352 049 000) and on shares
of 28 797 538 (2000 - 28 837 716). The calculation of diluted
earnings per share for the year ended 31 December 2000 of 1 681.4
cents is based on profit after taxation attributable to ordinary
shareholders of Z$490 192 000 and on diluted shares of 29 153 051.
No dilution in earnings per share arose from share options granted
to senior employees in terms of the Executive Share Option Scheme
at 30 June 2001.
8.4 Diluted headline earnings per share
The diluted headline earnings per share for the six months ended
30 June 2001 is 1 537.8 cents (2000 - 1 220.8 cents). The
calculation is based on adjusted profit after taxation of
Z$442 849 000 (2000 - Z$352 049 000) and on shares of 28 797 538
(2000 - 28 837 716). The calculation of diluted headline earnings
per share for the year ended 31 December 2000 of 1 679.6 cents is
based on adjusted profit after taxation of Z$489 645 000 and on
diluted shares of 29 153 051.
9. Share capital
9.1 Authorised
The authorised ordinary share capital at 30 June 2001 is at the
historical figure of Z$140 000 000 (2000 - Z$140 000 000)
comprising 40 000 000 ordinary (2000 - 40 000 000) shares of
Z$3.50 each.
9.2 Issued and fully paid
The issued share capital at 30 June 2001 is at the historical
figure of Z$103 998 000 (2000 - Z$99 630 000) comprising
29 713 650 (2000 - 28 465 589) ordinary shares of Z$3.50 each.
The increase relates to staff share options exercised under the
Executive Share Option Scheme.
9.3 Purchase of own shares
Shareholders authorised the directors to purchase for cancellation
4 000 000 of the company's own shares at the Annual General
Meeting held on 29 May 2001. By the end of June 2001, no shares
had been purchased.
10. Taxation
The effective tax rate for the six months ended 30 June 2001 is 51.1%
compared to 24.4% for the six months ended 30 June 2000 and 44.8% for the
year ended 31 December 2000. The effective tax rate is higher compared to
prior periods as the current year did not benefit from assessed tax losses
and a comparatively higher monetary loss was recorded.
11. Exchange rates
The official exchange rates applied were as follows:
30 June 30 June 31 December
2001 2000 2000
British
Sterling GBP 1.00 Z$77.48 Z$62.03 Z$82.07
United
States
Dollar USD 1.00 Z$55.00 Z$37.95 Z$55.00
South African
Rand ZAR 1.00 Z$6.83 Z$5.51 Z$7.29
The inflation adjusted accounts are the principal accounts of the Group. The
historical accounts are supplementary and have been included to facilitate
comparability.
NMBZ HOLDINGS LIMITED HISTORICAL RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
Income Statement
Unaudited
Unaudited Restated Restated
6 months 6 months Year ended
ended ended 31 December
NOTE 30 June 2001 30 June 2000 2000
Z$'000 Z$'000 Z$'000
Interest from lending
activities 325 663 118 578 320 410
Charge for bad and
doubtful debts (168 716) (76 691) (77 895)
156 947 41 887 242 515
Interest from investing activities 1 059 305 144 685 461 604
1 216 252 186 572 704 119
Interest expense (276 817) (71 009) (173 949)
Net interest income 939 435 115 563 530 170
Foreign Exchange Gains 200 357 175 277 217 578
Net Dealing Income from Securities 165 001 152 840 456 950
Other income a 366 777 163 552 123 885
Net operating income 1 671 570 607 232 1 328 583
Operating expenditure b (423 696) (199 933) (408 790)
Profit before taxation 1 247 874 407 299 919 793
Taxation (484 259) (69 865) (289 679)
Profit after taxation 763 615 337 434 630 114
Outside shareholders' interests (18 587) (2 221) (3 352)
Profit attributable to ordinary
shareholders 745 028 335 213 626 762
Dividend per share (cents) 343.0 250.7 607.0
- interim 343.0 250.7 250.7
- final - - 356.3
Earnings per share (cents) c 2 587.1 1 177.6 2 201.4
Headline earnings per share (cents) 2 576.3 1 177.6 2 197.2
Diluted earnings per share (cents) 2 587.1 1 162.4 2 149.9
Diluted headline earnings per
share (cents) 2 576.3 1 162.4 2 145.9
Dividend cover (times) 7.30 4.70 3.62
Number of issued shares (000's) 29 714 28 466 28 614
NMBZ HOLDINGS LIMITED HISTORICAL RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
Balance Sheet
Unaudited Unaudited Audited
At 30 June At 30 June At 31 Dec
2001 2000 2000
Shareholders' funds Z$'000 Z$'000 Z$'000
Share capital 103 998 99 630 100 150
Capital reserves 299 320 223 245 225 192
Revenue reserves 1 474 603 624 093 844 279
1 877 921 946 968 1 169 621
Minority Interest 25 841 8 650 9 781
1 903 762 955 618 1 179 402
Liabilities
Deferred taxation 262 973 17 765 201 706
Deposits and other accounts:
- held for trade 5 430 655 1 153 742 1 734 548
- at restated values 5 560 705 769 162 1 070 503
Provision for current taxation 454 347 97 103 115 743
Acceptances 4 882 874 2 032 464 2 981 936
18 495 316 5 025 854 7 283 838
Assets
Balances with banks and cash 357 409 26 275 447 352
Government and public sector
securities
- held for trade 3 689 734 690 575 959 878
Advances and other accounts
- at book value 4 684 206 1 447 517 1 856 644
Investments:
Trade investment
- at book value 2 718 7 858 2 718
Short term investments
- held for trade 3 241 703 6 684 392 236
Other - held for trade 1 029 663 495 580 160 147
Fixed assets 607 009 318 901 482 927
Customers' indebtedness for
acceptances 4 882 874 2 032 464 2 981 936
18 495 316 5 025 854 7 283 838
NMBZ HOLDINGS LIMITED HISTORICAL RESULTS & DIVIDEND ANNOUNCEMENT
for the six months ended 30 June 2001
STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 June 2001
Revenue
Reserves
Statu- Redemp- Accumu-
Share Share tory tion lated
Capital Premium Reserve Reserve Other Profit Total
Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z $'000
Balances at
1 January
2000 99 630 172 149 22 500 27 921 675 288 880 611 755
Effects of
adopting
IAS 10 - - - - - 161 413 161 413
As restated
at 1
January
2000 99 630 172 149 22 500 27 921 675 450 293 773 168
Net profit
for the
period - - - - - 335 213 335 213
Dividends - - - - - (161 413) (161 413)
Balances
at 30
June 2000 99 630 172 149 22 500 27 921 675 624 093 946 968
Balances
at 1 July
2000 99 630 172 149 22 500 27 921 675 624 093 946 968
Shares
issued 520 1 947 - - - - 2 467
Net profit
for the
period - - - - - 291 549 291 549
Dividends - - - - - (71 363) (71 363)
Balances at
31
December
2000 100 150 174 096 22 500 27 921 675 844 279 1 169 621
Balances at
January
2001 100 150 174 096 22 500 27 921 675 844 279 1 169 621
Effects of
adopting
IAS 39 - - - - - (12 743) (12 743)
As restated
at 1
January
2001 100 150 174 096 22 500 27 921 675 831 536 1 156 878
Shares
issued 3 848 74 128 - - - - 77 976
Net profit
for the
period - - - - - 745 028 745 028
Dividends - - - - - (101 961) (101 961)
Balances at
30 June
2001 103 998 248 224 22 500 27 921 675 1 474 603 1 877 921
Cashflow Statement
Unaudited Unaudited Audited
Six months Six months Year
ended ended ended
30 June 30 June 31 Dec
2001 2000 2000
Z$'000 Z$'000 Z$'000
Operating cash flow before changes in
operating assets and liabilities 1 449 063 418 961 1 019 502
Changes in operating assets and
liabilities:
Deposits and other accounts 8 186 309 (157 390) 724 757
Advances and other accounts (2 996 278) (230 598) (717 620)
6 639 094 30 973 1 026 639
Net interest received on government &
public sector securities 5 000 - 33 245
Dividends paid (101 961) (162 980) (234 344)
Corporate tax paid (84 388) (40 746) (57 978)
Net cash outflow from investing
activities (1 046 341) (560 177) (451 193)
Net cash inflow/(outflow) before
financing activities 5 411 404 (732 930) 316 369
Net cash inflow from
financing activities 77 976 - 2 467
Cash and cash equivalents
at beginning of period 1 775 300 1 456 464 1 456 464
Cash and cash equivalents
at end of period 7 264 680 723 534 1 775 300
Cash and cash equivalents comprise cash and bank balances, treasury bills
included in Government and public sector securities and short term investments.
UNAUDITED HISTORICAL GROUP RESULTS AND DIVIDEND ANNOUNCEMENT
SEGMENT RESULT
for the six months ended 30 June 2001
06/01 06/00 12/00 06/01 06/00 12/00
Z$'000 Z$'000 Z$'000 Z$'000 Z$'000 Z$'000
REVENUE
External interest
and other revenue 217 990 - 47 344 1 451 054 607 232 1 281 239
Total revenue 217 990 - 47 344 1 451 054 607 232 1 281 239
RESULT
Operating profit
before
unallocated
expenses 100 684 - (2 585) 1 147 190 407 299 922 378
Unallocated
corporate
Expenses:
Income taxes
Minority
interest
Profit attributable
to ordinary
shareholders
06/01 06/00 12/00
Z$'000 Z$'000 Z$'000
REVENUE
External interest and other revenue 1 669 044 607 232 1 328 583
Total revenue 1 669 044 607 232 1 328 583
RESULT
Operating profit before unallocated
expenses 1 247 874 407 299 919 793
Unallocated corporate Expenses:
Income taxes (484 259) (69 865) (289 679)
Minority interest (18 587) (2 221) (3 352)
Profit attributable to ordinary
shareholders 745 028 335 213 626 762
UNAUDITED HISTORICAL GROUP RESULTS AND DIVID
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