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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Tiso Blackstar | LSE:TBGR | London | Ordinary Share | GB00BF37LF46 | ORD EUR0.76 |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 22.50 | 15.00 | 30.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMTBGR
RNS Number : 9198L
Tiso Blackstar Group SE
06 October 2016
Tiso Blackstar Group SE
Results Announcement June 2016
Incorporated in Malta
Company number SE 4
Registered as an external company with limited liability in the
Republic of South Africa under registration number 2011/008274/10
LSE Share code: TBGR
JSE Share code: TBG
ISIN: MT0000620113
("Tiso Blackstar" or the "Company" or the "Group")
Director's statement
Highlights for the year ended 30 June 2016
-- Group EBITDA R522 million (GBP24 million) over the period
-- Core asset TMG EBITDA up 15% to R358 million (GBP17 million) (2015 - R310 million, GBP17 million)
-- Underlying earnings showed growth in tough markets
-- Reduced acquisition debt from R500 million (GBP26 million) to R414 million (GBP21 million)
-- TMG debt reduced from R800 million (GBP42 million) to R730 million (GBP37 million)
-- Final dividend per share 4.47 cents (0.25 pence) (interim 3.74 cents (0.17 pence))
-- Change in status - investments will now be consolidated and no longer fair valued providing more meaningful reporting on the Group's trading performance
-- R1,987 million (GBP102 million) of non-core assets earmarked for disposal
Executive summary
Overview
In March 2016, Tiso Blackstar announced its intention to become a single sector investment holding company with a focus on media and related industries in a more focused approach. With its media expertise, intellectual capital and operational ability, Tiso Blackstar is ideally positioned to focus its resources on developing its existing brands and media businesses as well as seeking media related opportunities, on the African continent.
This shift in focus means that Tiso Blackstar will dispose of all non-core assets carried at a fair value of R1,987 million (GBP102 million) at 30 June 2016 which have been identified as:
-- Robor Proprietary Limited ("Robor")
-- Consolidated Steel Industries Proprietary Limited ("CSI")
-- Kagiso Tiso Holdings Proprietary Limited ("KTH")
The exit process will be conducted in a measured and orderly manner with the objective to ensure that not only optimal exit values are achieved for the benefit of our shareholders but also to take into account our responsibilities to other key stakeholders within these businesses. The Tiso Blackstar Board stresses that achieving optimum value for these assets is paramount and to this end will be patient in concluding the sale.
Once Tiso Blackstar progresses in the disposal of its non-core investments to move towards being a single sector investment holding company, it is expected to cease to be regarded as an Investment Entity under the accounting standards. Consequently, investments in subsidiaries and associates will no longer be fair valued but rather consolidated and equity accounted, and the Group's performance will no longer be assessed on a net asset value ("NAV") basis but rather on earnings. This is expected to take effect for the first time in the Group's interim results for the period ending 31 December 2016. For reference, had the Group consolidated its investments in this current reporting period, it is estimated that it would have reported Group Earnings before Interest, Taxation, Depreciation and Amortisation ("EBITDA") amounting to approximately R522 million (GBP24 million) of which Times Media Group Limited ("TMG") contributed 69% with EBITDA of R358 million (GBP17 million) (excluding African investments). Non-core assets CSI and Robor contributed EBITDA of R66 million (GBP3 million) (13%) and R105 million (GBP5 million) (annualised, 20%) respectively. A dividend of R30 million (GBP1 million) from KTH represented 6% of EBITDA and the balance (-8%) comprised mainly of Tiso Blackstar head office running costs.
In difficult markets and a challenging South African economy, Tiso Blackstar has been able to grow earnings in both its core and non-core investments. This has been achieved by closely monitoring and assessing the performance of each underlying business, streamlining workflows where necessary, concentrating on managing the cost base relative to changes in revenue, increased focus and efforts to growing revenue, investing in new markets within Africa and adding additional revenue streams.
TMG has developed into a wide-ranging media player in the South African and East and West African marketplace, having restructured and diversified over recent years. Originally as a newspaper heritage, the business is often perceived as a newsprint media-only business, but in fact the traditional print and digital Media segment of TMG contributes only 27% of its overall EBITDA.
TMG's earnings base is diverse and covers many media segments and related revenue streams as indicated in the EBITDA analysis provided below.
Hot Features
Premium
TMG
----------------------------------------------------
Contribution to TMG EBITDA*
----------------------------------------------------
GBP11
Retail Solutions R235 million million 60%
------------------ -------------- ---------- ----
GBP5
Media R106 million million 27%
------------------ -------------- ---------- ----
Broadcasting GBP2
and Content R51 million million 13%
------------------ -------------- ---------- ----
* excludes exceptional items and
head office costs
Retail Solutions operates in selected operating niches primarily within the retail and FMCG sectors providing a range of media services critical to the marketing functions of each client. This operation is more resilient to economic conditions and changing media consumption patterns than traditional media. Retail Solutions represents a significant proportion of the TMG earnings base (60%), and has successfully grown and continues to grow earnings in difficult markets.
Broadcasting and Content comprises TMG's local broadcast and entertainment assets which have performed increasingly well in recent years. Between TV, Films and Music, these businesses contributed R72 million (GBP3 million) in EBITDA. TMG is investing in two local start up radio stations, Vuma FM and Rise FM, which generated a R21 million (GBP1 million) combined EBITDA loss for the current year. The Broadcasting and Content division has exciting long-term growth prospects in its radio and TV investments in East and West Africa.
Although successful in terms of diversifying revenues, TMG is highly conscious of the need to adapt its traditional newspaper business to the changing media consumption habits. The Media division has invested in various new and complimenting revenue streams such as digital, eventing and native advertising whilst at the same time resetting its cost base to operate sustainably in the future.
As evident in more developed media markets worldwide, newspapers will remain a relevant and important part of the media mix for many years to come, not only as a highly relevant medium for premium loyal readers but also as an important advertising tool for marketers and media planners.
The non-core assets performed well in challenging markets. Further detail around realisations of these assets will be provided as they develop. The steel sector is currently experiencing tough conditions and is out of favour so patience is required with respect to the realisation of assets in this sector.
Investment performance
Times Media Group
Media division
The Media business continues to be the premier news group in South Africa, accounting for the highest market share in advertising and circulation in the English language newspaper market as well as a significant portion of the digital news landscape. Although the industry is facing structural challenges in the short term it is expected to find a sustainable base from which to operate and even grow, as has already happened in many developed markets.
This division reflected the weak macro-economic environment as well as a structural decline in print consumption and advertising in the financial year. As a result the division produced lower revenue and profits, although the positive impact of reduced publishing costs and a more integrated management structure emerged in the second half of the year.
Despite the decline in revenues, the bulk of the group's newspapers remain profitable. Particular highlights include the Business Day and Financial Mail posting EBITDA growth in the full year as a result of rightsizing in the prior two years after several years of negative operational performance. The Eastern Cape unit - comprising The Herald, Daily Dispatch, Weekend Post and community newspapers posted growth in profitability despite continued revenue pressures. National titles The Sunday Times and The Sowetan were affected by a decline in government advertising, particularly tenders and careers advertising, and are being managed to reduce any over-reliance on government advertising.
The magazines business continued to show profit growth as a result of strong management and its niche positioning in key markets.
TMG recognises that although the Media division continues to trade profitably, it needs to be flexible to market conditions in view of the changes to both the media industry and the economy. Several initiatives and strategies were implemented during the current financial year details of which are provided below:
-- The business embarked on a fixed cost reduction exercise that unfortunately will include retrenchments. The cost reduction programmes are currently underway and are expected to be implemented fully in the first half of the new financial year following which, the business is expected to stabilise and continue to produce solid cash flow;
-- The intended and managed reduction in unprofitable and low-yielding circulation as well as a significant reduction in management costs resulted in close to a 10% reduction in overall costs, although an almost 12% decline in revenues saw a reduction in earnings from existing operations;
-- New revenue areas such as Eventing, Digital and Surveys continue to be pursued as they not only offer growth prospects but also an opportunity to offset traditional revenue declines;
-- An innovation programme which includes redesigns for all newspapers and an integrated digital workflow process is progressing well with redesigns of Business Day, Financial Mail and Sunday Times expected to be launched by October 2016, and the balance of titles launched early in 2017;
-- Following a period of intense focus and investment in talent and technology, the group's digital properties showed exceptional growth, with TimesLive, BDLive and SowetanLive posting year on year audience growth of between 35% and 55%;
-- Monetising audience in a digital world remains a challenge, but a revamped BusinessLive site, which will include a paywall, with exceptional content from our own writers as well as exclusive Wall Street Journal and Financial Times content amongst others, will be launched in the second quarter of the financial year and offers further revenue growth opportunities;
-- In August 2016, Business Day's highly popular and high-end luxury magazine Wanted also launched a digital version, Wantedonline, and has already attracted significant advertiser and user interest;
-- The Media business will move into modern new premises by the end of the financial year ended 30 June 2017, enabling a more integrated approach to news gathering and production across platforms as well as producing bottom line savings in rental and facilities costs;
-- The company continues to invest in quality journalism across its platforms as borne out by the exceptional performance by its reporting teams at all of the key national journalism awards in 2016; and
-- Distribution network: Significant progress has been made in reducing inefficiencies in the distribution and logistics network, but this remains an area for further improvement with industry cooperation.
Broadcasting and Content
In Broadcasting and Content, Television once again performed well with both Ochre (TV production) and One Africa (TV Channels) posting double digit earnings growth. Radio remains in an early investment stage but reined in losses relative to prior year. Both TV and Radio are well positioned to continue to produce solid improvement going forward.
Times Media Films remains the continent's leading all-rights distributor of local and international films business, but had a difficult year as a result of changing market conditions and the industry business model.
Gallo, the music business, produced further growth in earnings and revenue as it continues to build a 360 degree offering including events and artist management with a broad market-wide offering. From being a loss maker three years ago, the combined music business produced an EBITDA of almost R10 million (GBP0.5 million).
Retail Solutions
Hirt & Carter ("H&C")
Despite certain customers reducing spend as a result of the tough macro-economic environment, H&C was able to achieve growth in EBITDA of 5.8%. The continued focus on efficiencies and cost savings assisted in streamlining the business and improving the gross margin for the year. H&C also made the decision to exit certain sectors of the market that were not generating the required returns.
The retail software footprint of the business continues to grow with the addition of new customers in this space during the current year and leads to win attractive new clients in the near future.
Focus on the Omni-Channel retail environment has opened up opportunities to extend software and data services with e-commerce projects having commenced and a number of new clients being won.
H&C is investing in a single centre of excellence and as a result closed the Gauteng production facility in June 2016 and will be relocating to a new facility in Durban in July 2018. The design of the new facility will lead to better efficiencies, a reduced footprint and an inherent overall operating cost reduction. In line with global trends, H&C has also invested in cutting edge digital technology for its Durban facility which should be fully operational from November 2016 and will completely refresh the factory. Customers will have access to a greater range of solutions for their marketing spend.
Uniprint
Despite a challenging economy and a volatile South African currency, Uniprint increased its turnover by 9.6% and operating profit by 28%. This was largely as a result of increased election work in Africa. The labels and forms division performed well, and Uniprint recently concluded a transaction to acquire a substantial niche packing business which will provide necessary economies of scale to its existing packaging business.
African Media investments
Tiso Blackstar's expansion into other African territories offers strong upside potential. The 49% interest in Radio Africa Limited ("RAG") in Kenya and 32% interest in Multimedia Group Limited ("MGG") in Ghana represent substantial growth opportunities over the longer term, as do early stage investments in Nigeria and potentially Uganda. Most media markets across the continent are small relative to more developed markets and are expected to expand with their fast growing consumer markets.
Radio in these countries has large, engaged audiences and is a large advertising medium. Tiso Blackstar's radio assets are well positioned in these markets. Furthermore they have invested in television, which is still in its infancy of developing audience and advertising market share.
In Kenya, RAG's top three radio brands (Jambo, Classic and Kiss) have a cumulative national audience of almost 18 million in a population of 44.4 million and represent three of the top five most listened to radio stations. RAG has also invested in an early stage Digital Terrestrial Television ("DTT") television business called Bamba TV. RAG has a five year trend of strong revenue and earnings growth (up 125%), with earnings up six fold over the period in local currency. Recent profits have been slowed by its TV investment, but this investment is expected to deliver significant growth in the future.
In Rand terms the core Kenyan radio business generated EBITDA of R47 million (GBP2 million). After accounting for early stage investment in DTT business Bamba TV, and certain start up radio stations, RAG produced EBITDA of R29 million (GBP1 million).
MGG is the leading independent media player in Ghana and holds three of the top six radio stations in the country with significant advertising market share. Its radio earnings quadrupled in five years, despite significant economic challenges in the country and region, off the back of a threefold revenue growth over the period in local currency. The TV investment, Multi TV, has shown some benefit following restructuring, achieving a 32% market share for the three operating channels and reducing losses at the same time.
MGG's full year earnings in 2015 from radio were R30 million (GBP2 million), but after accounting for the investment in developing Multi TV amounted to R6 million (GBP0.3 million). In the first seven months of the year radio was trading 8% better at a profitability level and TV had reduced losses by 44%.
The group acquired an effective 36.5% interest in start-up Lagos Talk station in Nigeria with an option into the broader Megalectrics business which holds Beat, Classic and Naija and has an option to purchase leading Ugandan stations Capital and Beat in Kampala.
Non-core assets
Tiso Blackstar holds a 22.9% interest in KTH, a leading black owned diversified investment holding company with investments in a broad range of sectors including media, financial services, resources, industrial and healthcare. In line with its intention to dispose of its non-core assets, Tiso Blackstar is in the early stages of negotiating a disposal of its interest in KTH which is expected to be completed within the next financial year. KTH is carried at its estimated fair value less cost to sell of R1.5 billion (GBP78 million) and separately disclosed as a non-current asset held for sale.
Revenue at CSI, comprising the Stalcor and Global Roofing Solutions businesses, was flat and normalised earnings were down by 9% due to the trading impact of the location move in Gauteng, set-up costs relating to the expansion of its South African branch network and a highly competitive economic environment. CSI achieved an EBITDA of R66 million (GBP3 million) for the current financial year. The business is well positioned for growth next year with its established African footprint, additional branches, product lines and improved banking facilities.
Robor had a good nine month financial year to 30 June 2016 generating an EBITDA of R79 million (GBP4 million) and has traded well in a very difficult environment. The company remains well positioned in the renewable energy, water, transmission and cellular tower markets, and has chosen to pursue margin preservation over volume in the year ahead, focusing on value added products. Robor is in the process of securing larger working capital facilities to ensure that it has sufficient head room when larger projects commence.
Financial review
Tiso Blackstar is an Investment Entity and therefore measured its investments, including certain subsidiaries and associates, at fair value though profit and loss as opposed to consolidating and equity accounting. The following subsidiaries, which provide services that relate to the Company's own investment activities, continue to be consolidated: Tiso Blackstar (Cyprus) Public Limited ("Tiso Blackstar Cyprus"); Tiso Blackstar Group Proprietary Limited ("Tiso Blackstar SA"); Tiso Blackstar Holdings Plc ("TBH UK") and Tiso Blackstar Limited ("TBL"). TBH UK and TBL are new companies incorporated during the current reporting year, as part of the Company's planned migration to the United Kingdom ("UK").
As a result of this accounting treatment, the Tiso Blackstar consolidated statement of financial position is more closely aligned with the Intrinsic NAV of the Group than it would be under the traditional equity accounting model.
Subsequent to year end, Tiso Blackstar's status as an Investment Entity is expected to change as a result of its revised strategy and thus going forward, Tiso Blackstar will no longer account for its net investments in subsidiaries and associates as investments held at fair value through profit and loss but rather consolidate its subsidiaries and equity account for its investments in associates. The interim results for the period ended 31 December 2016 are expected to be prepared on this basis.
On completion of the TMG and KTH acquisitions during June 2015, Tiso Blackstar changed its financial year end from 31 December to 30 June. The comparative reporting period is therefore provided for a six month period ended 30 June 2015.
Investment-related income for the year ended 30 June 2016 amounted to R423.0 million (GBP19.7 million) which comprises of income generated from investments in the form of support, guarantee and directors fees, and dividends and interest income. The majority of the dividend income consists of the investments in RAG and MGG received as a dividend in specie of R339.5 million (GBP15.8 million).
The investments held by Tiso Blackstar have performed well operationally in the current financial period and both core and non-core businesses are well positioned to deliver value going forward. Tiso Blackstar has decided to take a conservative approach in valuing its investments resulting in a reduced NAV, which shall be used as the starting point of its consolidated financial statements going forward.
Net fair value and foreign exchange losses for the year ended 30 June 2016 amounted to R1,036.3 million (GBP48.3 million) which mainly comprises of net losses on investments of R1,035.4 million (GBP48.2 million).
Net losses on investments includes R2.1 million (GBP0.1 million) of realised losses on disposal of its smaller investments and R1,033.3 million (GBP48.1 million) of unrealised net fair value losses. The majority of the unrealised net fair value losses consists of: a R1,091.7 million (GBP50.8 million) loss on TMG; a R85.1 million (GBP4.0 million) loss on CSI; a R109.8 million (GBP5.1 million) gain on Robor; and a R14.5 million (GBP0.7 million) loss on Tiso Blackstar Real Estate Proprietary Limited and the property subsidiaries.
Operating expenses of R63.9 million (GBP3.0 million) mainly include the day-to-day operational expenses of R40.7 million (GBP1.9 million) incurred to run Tiso Blackstar and its consolidated subsidiaries, and transaction related costs of R16.9 million (GBP0.8 million) the majority of which are costs arising on the shareholder approved migration to the UK. Operational expenses for the reporting period amount to 1.2% of the Intrinsic NAV as at 30 June 2016 and transaction related costs incurred amounted to 0.5% of the value of the investments acquired. Costs are closely monitored and action is taken wherever possible to cut any excess expenditure in order to improve the profitability of the Group.
Total equity attributable to equity holders of Tiso Blackstar decreased from R4.4 billion (GBP230.4 million) at 30 June 2015 to R3.5 billion (GBP179.2 million) at 30 June 2016 as a result of the net losses on investments recognised in profit and loss.
Total assets decreased from R4.9 billion (GBP254.9 million) as at 30 June 2015 to R3.9 billion (GBP200.8 million) as at 30 June 2016 as a result of the decline in the fair value of investments held at fair value though profit and loss.
At 30 June 2016, the investment in KTH met the requirements of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, and has been separately classified and disclosed from other investments held at fair value through profit and loss, as a non-current asset held for sale and a discontinued operation.
Changes in the fair value, dividends and fees earned, and relating tax charges, attributable to KTH have been disclosed separately from continuing operations as a discontinued operation. The loss from the discontinued operation of R179.9 million (GBP8.4 million) includes R209.5 million (GBP9.8 million) net loss recognised on the investment in KTH; R29.5 million (GBP1.4 million) dividend received; and R1.0 million (GBP0.05 million) in directors' fees earned.
On implementation of the TMG and KTH acquisitions during June 2015, Tiso Blackstar raised debt of R534.0 million (GBP28.0 million) which was used to settle the existing facility held, transaction related costs and the cash consideration of the KTH purchase price. This debt was reduced to R413.8 million (GBP21.2 million) by 30 June 2016 utilising proceeds from disposals of smaller investments and free cash.
Cash and cash equivalents declined by R6.6 million (GBP0.3 million) during the current financial year to an amount of R13.1 million (GBP0.7 million). Significant cash flow movements during the year include a R76.4 million (GBP3.6 million) cash outflow on repayment of borrowings and related finance costs; a R11.1 million (GBP0.5 million) cash outflow on purchase of treasury shares off the open market; a R10.0 million (GBP0.5 million) cash outflow of dividends paid to shareholders; a R16.9 million (GBP0.8 million) cash outflow on acquisition of investments; a R99.5 million (GBP4.6 million) cash inflow in respect of dividends and interest income; a R55.8 million (GBP2.6 million) cash inflow on realisation of investments.
Share buy-backs, share issues and treasury shares
During the current financial year, the Company repurchased a total of 1,182,310 Tiso Blackstar shares in the open market at an average price per share of R9.38 (GBP0.44) per share and a total cost of R11.1 million (GBP0.5 million). At 30 June 2016, Tiso Blackstar held 1,067,925 treasury shares, representing 0.4% of the issued share capital. As long as the Tiso Blackstar share price trades at a significant discount to its Intrinsic NAV, the Company will continue with further share buy-backs.
During October 2015, Tiso Blackstar increased its interest in Robor from 19.4% to 51.0%. The purchase consideration was settled through the issue of 1,740,358 (1,625,973 ordinary shares and 114,385 treasury shares) Tiso Blackstar shares, thereby increasing the issued share capital of the Company to 268,291,260 shares.
Other matters
Tiso Blackstar anticipates that with time its share price will be evaluated more by underlying earnings than NAV due to the afore-mentioned shift in focus to investing in a media related businesses.
As a result of this, the Tiso Blackstar Board has taken the view that there will be a change in the Group's status as an Investment Entity as defined in IFRS 10 Consolidated Financial Statements. In the future, Tiso Blackstar will no longer account for its net investments in subsidiaries and associates as investments held at fair value through profit and loss but rather consolidate its subsidiaries and equity account for its investments in associates. It is currently expected that the Group's interim results for the period ended 31 December 2016 and annual/interim results thereafter will be prepared on a consolidated basis.
It is believed that consolidated results will provide investors more meaningful insight into the earnings and trading performance of the Group. This change in approach will also necessitate a change in the long term Management Incentive Scheme which will be presented to shareholders in due course.
The Company continues to work with its advisers on the shareholder approved migration of its registered office from Malta to the UK as well as the migration of the investment holding company Tiso Blackstar Cyprus from Cyprus to the UK. This process is complex and has been frustrated by unavoidable delays in ensuring that the migration of Tiso Blackstar Cyprus complies with the regulatory and administrative requirements of regulators in Cyprus and the UK. Subject to the necessary approvals being obtained, the Company's advisers anticipate that the migration process should be completed in the first half of 2017.
Dividends
Tiso Blackstar views dividends as an important part of shareholder return and value. In determining dividends, the Company considers its current financial flexibility, the expected net cash flows from assets, as well as expected strategic corporate actions. It also considers the current share trading price, and the opportunity to buy back Tiso Blackstar shares to enhance shareholder return. The Company places emphasis on making some dividend payments on an interim and final basis, with a view to growing the dividend over time. The Tiso Blackstar Board has recommended a final dividend of 4.47275 South African cents (0.25 pence) per share, which is subject to shareholder approval at the next annual general meeting. The timetable for the dividend, which includes the record and payment dates, will be released along with the timetable for the annual general meeting in due course.
Black Economic Empowerment
Tiso Blackstar is committed to transformation and the revised Broad-Based Black Economic Empowerment Codes of Good Practice which came into effect on 1 May 2015 ("B-BBEE"). A summary of its key empowerment credentials include:
-- Tiso Blackstar has a B-BBEE ownership status of 45.47%;
-- TMG achieved a level 3 contributor status on the revised B-BBEE codes;
-- TMG has a B-BBEE ownership status of 58.47%; and
-- TMG is considered an empowering supplier with a 110% procurement recognition level.
Outlook
The past financial year has been spent not only bedding down the acquisition of the stake in KTH and the remaining shares in TMG, but also reviewing the operations and making necessary adjustments to remain profitable during tough economic conditions. With a solid foundation in place, the change in strategic direction to an exclusive media focus represents exciting times for Tiso Blackstar. TMG continues to be one of the leading media groups in South Africa and now has the ability to adapt to changes in the market. It has invested in new revenue streams, technology, talent and innovative concepts which are expected to enhance earnings in the upcoming year. Media and related industries is an attractive high value sector across the African continent and the Group will continue to consider acquisitions to complement its existing media assets in South Africa, Kenya, Ghana and Nigeria.
Tiso Blackstar has identified non-core assets amounting R1,987 million (GBP102 million) for disposal and has already made good progress in this regard. Negotiations are currently underway for the disposal of the 22.9% interest in KTH, which has a value of R1.5 billion (GBP78 million). With a completion date expected within the next financial year, this will allow Tiso Blackstar to settle all of its outstanding acquisition debt (amounting to R414 million (GBP21 million) at 30 June 2016), and the balance of proceeds will provide the Group with the opportunity to invest in existing and or new media-focused investments. The sale of non-core assets not only enhances Tiso Blackstar's cashflow position, but also provides it with more flexibility to invest in exciting growth opportunities.
Tiso Blackstar is intent on becoming a dominant player in the African media sector whilst unlocking value for the benefit of shareholders. With the various initiatives being driven within the Group, significant headway is expected to be achieved in the following year.
AD Bonamour DKT Adomakoh
Non-executive Director Non-executive Chairman
6 October 2016
Consolidated statement of comprehensive income
for the year ended 30 June 2016
*As
restated
*As restated Twelve Twelve Six
Six months months months months
ended ended ended ended
30 June 30 June 30 June 30 June
2015 2016 2016 2015
R'000 R'000 GBP'000 GBP'000
------------- ------------ ------------------------------- --------- ----------
Investment-related
78,140 422,952 income 19,696 4,303
Net fair value and
foreign exchange (losses)
377,823 (1,036,271) gains (48,258) 20,804
(66,126) (63,877) Operating expenses (2,976) (3,638)
------------- ------------ ------------------------------- --------- ----------
389,837 (677,196) Operating (loss) profit (31,538) 21,469
(5,330) (48,865) Net finance costs (2,276) (294)
------------- ------------ --------- ----------
517 1,251 Finance income 58 28
(5,847) (50,116) Finance costs (2,334) (322)
------------- ------------ --------- ----------
(Loss) Profit before
384,507 (726,061) taxation (33,814) 21,175
289 (955) Taxation (45) 15
------------- ------------ ------------------------------- --------- ----------
(Loss) Profit from
384,796 (727,016) continuing operations (33,859) 21,190
Discontinuing operations
Loss from discontinued
(50,689) (179,853) operation, net of taxation (8,375) (2,791)
------------- ------------ ------------------------------- --------- ----------
(Loss) Profit for the
334,107 (906,869) year (42,234) 18,399
------------- ------------ ------------------------------- --------- ----------
Other comprehensive
loss - items that may
subsequently be reclassified
to profit and loss:
Currency translation
differences on the
translation
of Rand denominated
- - Group entities (8,887) (12,900)
------------- ------------ ------------------------------- --------- ----------
Total other comprehensive
loss recognised
- - directly in equity (8,887) (12,900)
------------- ------------ ------------------------------- --------- ----------
Total comprehensive
(loss) income for the
334,107 (906,869) year (51,121) 5,499
------------- ------------ --------------------------------- --------- ----------
(Loss) Profit for the
year attributable to:
Equity holders of the
334,277 (906,869) parent (42,234) 18,408
(170) - Non controlling interests - (9)
----------
334,107 (906,869) (42,234) 18,399
------------- ------------ ------------------------------- --------- ----------
Total comprehensive
(loss) income attributable
to:
Equity holders of the
334,277 (906,869) parent (51,121) 5,508
(170) - Non controlling interests - (9)
------------- ------------ ------------------------------- --------- ----------
334,107 (906,869) (51,121) 5,499
------------- ------------ ------------------------------- --------- ----------
Basic and diluted (losses)
earnings per
ordinary share attributable
to equity
317.81 (339.40) holders (in cents/pence) (15.81) 17.50
------------- ------------ ------------------------------- --------- ----------
Basic and diluted (losses)
earnings per
ordinary share attributable
to equity holders from
continuing operations
366.00 (272.09) (in cents/pence) (12.67) 20.15
------------- ------------ ------------------------------- --------- ----------
Weighted average number
of shares (net
of treasury shares,
105,181 267,199 in thousands) 267,199 105,181
------------- ------------ ------------------------------- --------- ----------
Basic and diluted headline
(losses) earnings per
share ^
(Loss) Profit for the
year attributable to equity
holders of the parent,
334,277 (906,869) adjusted for: (42,234) 18,408
875 - Impairment of goodwill - 46
Impairment of loans designated
at fair value through
- 737 profit and loss 34 -
Loss on disposal of
62 3 equipment - 3
Total tax effects of
(262) (1) adjustments - (14)
------------- ------------ --------------------------------- --------- ----------
334,952 (906,130) Headline (losses) earnings (42,200) 18,443
------------- ------------ --------------------------------- --------- ----------
Basic and diluted headline
(losses) earnings per
ordinary share attributable
to equity holders (in
318.45 (339.12) cents/pence) (15.79) 17.53
------------- ------------ ----------------------------------- --------- ----------
* Restated for discontinued operation, refer note 3
^ Disclosure of headline (losses) earnings has been
provided in accordance with the JSE Listings Requirements
Consolidated statement of changes in equity
for the year ended 30 June 2016
Capital Treasury Attributable Non
Share Share redemption shares Retained to equity controlling Total
capital premium reserve reserve earnings holders interests equity
R'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000
------------------- ---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Balance as at 31
December
2014 574,672 23,143 52,173 (9,284) 809,688 1,450,392 (206) 1,450,186
Total comprehensive
income for the
period - - - - 334,277 334,277 (170) 334,107
Income for the
period - - - - 334,277 334,277 (170) 334,107
Other
comprehensive
loss for the
period - - - - - - - -
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Transactions with
owners: 1,960,770 678,638 - 9,284 (30,713) 2,617,979 42 2,618,021
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Shares issued
for investment
acquisitions 1,950,299 677,038 - - - 2,627,337 - 2,627,337
Issue of shares
as
part of the
long term
Management
Incentive
Scheme 10,471 1,503 - - (11,974) - - -
Treasury shares
issued
during the
period as
part of the
long term
Management
Incentive
Scheme - 97 - 9,284 (9,381) - - -
Equity settled
share
based payment - - - - 2,432 2,432 - 2,432
Reduction in
non
controlling
interests
arising on
acquisition of
further
interest in
Blackstar
Fund
Managers
Proprietary
Limited
("BFM") - - - - (42) (42) 42 -
Dividends paid - - - - (11,748) (11,748) - (11,748)
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Balance as at 30
June
2015 2,535,442 701,781 52,173 - 1,113,252 4,402,648 (334) 4,402,314
-------------------- ---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Total comprehensive
loss for the year - - - - (906,869) (906,869) - (906,869)
Loss for the
year - - - - (906,869) (906,869) - (906,869)
Other
comprehensive
loss for the
year - - - - - - - -
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Transactions with
owners: 18,594 (569) - (9,797) (10,458) (2,230) 334 (1,896)
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Shares issued
for investment
acquisition 18,594 (569) - 1,293 - 19,318 - 19,318
Purchase of
treasury
shares - - - (11,090) - (11,090) - (11,090)
Disposal of
entire
interest in
BFM - - - - (445) (445) 334 (111)
Dividends paid - - - - (10,013) (10,013) - (10,013)
---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Balance as at 30
June
2016 2,554,036 701,212 52,173 (9,797) 195,925 3,493,549 - 3,493,549
-------------------- ---------- -------- ----------- --------- ---------- ------------- ------------ ----------
Consolidated statement of changes in equity continued
for the year ended 30 June 2016
Foreign
Currency
Capital Treasury Translation Attributable Non
Share Share redemption shares Reserve Retained to equity controlling Total
capital premium reserve reserve ("FCTR") earnings holders interests equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ -------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Balance as at 31
December
2014 55,347 2,024 4,599 (713) (28,762) 48,079 80,574 (11) 80,563
Total
comprehensive
income for the
period - - - - (12,900) 18,408 5,508 (9) 5,499
Income for the
period - - - - - 18,408 18,408 (9) 18,399
Other
comprehensive
loss for the
period - - - - (12,900) - (12,900) - (12,900)
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Transactions with
owners: 107,963 37,367 - 713 - (1,691) 144,352 2 144,354
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Shares issued
for
investment
acquisitions 107,386 37,279 - - - - 144,665 - 144,665
Issue of
shares as
part of the
long term
Management
Incentive
Scheme 577 83 - - - (660) - - -
Treasury
shares issued
during the
period
as part of
the
long term
Management
Incentive
Scheme - 5 - 713 - (516) 202 - 202
Equity settled
share
based payment - - - - - 134 134 - 134
Reduction in
non
controlling
interests
arising on
acquisition
of further
interest in
BFM - - - - - (2) (2) 2 -
Dividends paid - - - - - (647) (647) - (647)
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Balance as at 30
June
2015 163,310 39,391 4,599 - (41,662) 64,796 230,434 (18) 230,416
------------------- -------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Total
comprehensive
loss for the year - - - - (8,887) (42,234) (51,121) - (51,121)
Loss for the
year - - - - - (42,234) (42,234) - (42,234)
Other
comprehensive
loss for the
year - - - - (8,887) - (8,887) - (8,887)
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Transactions with
owners: 891 (28) - (468) - (485) (90) 18 (72)
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Shares issued
for
investment
acquisition 891 (28) - 62 - - 925 - 925
Purchase of
treasury
shares - - - (530) - - (530) - (530)
Disposal of
entire
interest in
BFM - - - - - (19) (19) 18 (1)
Dividends paid - - - - - (466) (466) - (466)
-------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
Balance as at 30
June
2016 164,201 39,363 4,599 (468) (50,549) 22,077 179,223 - 179,223
------------------- -------- -------- ----------- --------- ------------ --------- ------------- ------------ ---------
A 2014 final dividend of 14 South African cents, 0.77 pence per ordinary share
was paid on 8 June 2015.
A 2016 interim dividend of 3.74 South African cents, 0.17 pence per ordinary
share was paid on 13 June 2016.
A 2016 final dividend of 4.47 South African cents, 0.25 pence per ordinary share
was recommended on 6 October 2016.
Consolidated statement of financial position
as at 30 June 2016
30 June 30 June 30 June 30 June
2015 2016 2016 2015
R'000 R'000 GBP'000 GBP'000
---------- ---------- ------------------------------------- --------- ---------
Assets
3,208 2,343 Deferred tax assets 120 167
1,079 4,331 Equipment 222 56
Financial assets at fair
value through profit and
4,813,605 2,369,958 loss 121,581 251,944
2,983,436 1,955,133 Net investments in subsidiaries 100,300 156,153
1,734,013 399,697 Net investments in associates 20,505 90,758
Financial assets held for
96,156 15,128 trading 776 5,033
- 1,520,000 Asset held for sale 77,978 -
150 198 Current tax assets 10 9
32,317 4,008 Trade and other receivables 206 1,691
19,727 13,086 Cash and cash equivalents 671 1,032
4,870,086 3,913,924 Total assets 200,788 254,899
---------- ---------- ------------------------------------- --------- ---------
Liabilities
(141) (84) Deferred tax liabilities (4) (7)
(22) (1,195) Other financial liabilities (61) (1)
(440,000) (413,766) Borrowings (21,227) (23,030)
(72) (160) Current tax liabilities (8) (4)
(27,537) (5,170) Trade and other payables (265) (1,441)
(467,772) (420,375) Total liabilities (21,565) (24,483)
---------- ---------- ------------------------------------- --------- ---------
4,402,314 3,493,549 Total net assets 179,223 230,416
---------- ---------- ------------------------------------- --------- ---------
Equity
2,535,442 2,554,036 Share capital 164,201 163,310
701,781 701,212 Share premium 39,363 39,391
52,173 52,173 Capital redemption reserve 4,599 4,599
- (9,797) Treasury shares reserve (468) -
Foreign currency translation
- - reserve (50,549) (41,662)
1,113,252 195,925 Retained earnings 22,077 64,796
Total equity attributable
4,402,648 3,493,549 to equity holders 179,223 230,434
(334) - Non controlling interests - (18)
---------- ---------- ------------------------------------- --------- ---------
4,402,314 3,493,549 Total equity 179,223 230,416
---------- ---------- ------------------------------------- --------- ---------
Net asset value per share
1,651 1,307 (in cents/pence) 67 86
---------- ---------- ------------------------------------- --------- ---------
Actual number of shares
in issue (net of treasury
266,665 267,223 shares, in thousands) 267,223 266,665
---------- ---------- ------------------------------------- --------- ---------
Consolidated statement of cash flows
for the year ended 30 June 2016
Twelve Twelve
Six months months months Six months
ended ended ended ended
30 June 30 June 30 June 30 June
2015 2016 2016 2015
R'000 R'000 GBP'000 GBP'000
----------- --------- --------------------------- -------- -----------
Cash flow from operating
activities
Cash absorbed by
(84,556) (43,599) operations (2,033) (4,655)
(493,480) (16,864) Additions to investments (759) (27,171)
110,080 55,840 Proceeds from investments 2,588 6,061
Dividend and interest
74,473 99,469 income received 4,632 4,101
- (1,603) Taxation paid (75) -
Cash generated (absorbed)
(393,483) 93,243 by operating activities 4,353 (21,664)
----------- --------- --------------------------- -------- -----------
Cash flow from investing
activities
(63) (3,698) Purchase of equipment (172) (3)
Proceeds on disposal
4 25 of equipment 1 -
517 1,251 Finance income received 58 28
- (9) Disposal of subsidiary - -
Cash (absorbed) generated
458 (2,431) by investing activities (113) 25
----------- --------- --------------------------- -------- -----------
Cash flow from financing
activities
534,200 - Borrowings raised - 29,414
(166,873) (26,234) Borrowings repaid (1,222) (9,189)
(5,847) (50,116) Finance costs paid (2,334) (322)
Purchase of treasury
- (11,090) shares (530) -
Dividends paid to
equity holders of
(11,748) (10,013) the parent (466) (647)
Cash (absorbed) generated
349,732 (97,453) by financing activities (4,552) 19,256
----------- --------- --------------------------- -------- -----------
Net decrease in cash
(43,293) (6,641) and cash equivalents (312) (2,383)
Cash and cash equivalents
at the beginning
63,020 19,727 of the year 1,032 3,501
Exchange losses on
- - cash and cash equivalents (49) (86)
----------- --------- --------------------------- -------- -----------
Cash and cash equivalents
at the end of the
19,727 13,086 year 671 1,032
----------- --------- --------------------------- -------- -----------
Notes to the consolidated financial statements
for the year ended 30 June 2016
1. Financial information
The financial information set out above does not constitute
the Company's statutory accounts for the year ended
30 June 2016 or six months ended 30 June 2015 as defined
in section 171 of the Malta Companies Act 1995. Statutory
accounts for the year ended 30 June 2016 will be delivered
to the Malta Registrar of Companies following the
Company's annual general meeting. The auditors have
reported on those accounts, their reports were unqualified
and did not include references to any matters to which
the auditors drew attention by way of emphasis without
qualifying their reports. Their reports for the year
ended 30 June 2016 or six months ended 30 June 2015
did not contain statements under s149 paragraph (10),
(11), (12) of the Malta Companies Act 1995.
The functional currency of the Company is the South
African Rand, being the currency of the primary economic
environment in which the Company and its subsidiaries
operate.
Tiso Blackstar is dual listed with a primary listing
on the AIM market of the London Stock Exchange ("AIM")
and a secondary listing on the Altx of the JSE Limited
("JSE") in South Africa. As a result, Tiso Blackstar
has two presentational currencies being South African
Rand ("Rands") and Pounds Sterling ("Pounds Sterling").
This announcement contains inside information for
the purposes of article 7 of the Market Abuse Regulation
(EU) No. 596/2014.
Distribution of the annual report and accounts to
2. shareholders
The Group's audited statutory accounts for the year
ended 30 June 2016 will be available shortly to shareholders
via the Company's website www.tisoblackstar.com.
3. Discontinued operation
Tiso Blackstar announced its change in strategy to
focus on investments in media and related industries,
and to therefore dispose of its non-core assets.
In line with this, Tiso Blackstar is in the early
stages of negotiating a disposal of its interest in
KTH which is expected to be completed within the next
financial year. The investment in KTH has therefore
been disclosed as a discontinued operation, and classified
and disclosed as a non-current asset held for sale
in accordance with IFRS 5 Non-current Assets Held
for Sale and Discontinued Operations.
For further enquiries, please contact:
Tiso Blackstar Group SE Leanna Isaac + 356 2137 3360 ZAI Corporate Finance Peter Trevelyan-Clark/Dugald +44 (0) 20 7060 Limited Carlean 2220 (NOMAD) PSG Capital Proprietary +27 (0) 21 887 Limited David Tosi 9602 (JSE sponsor)
This information is provided by RNS
The company news service from the London Stock Exchange
END
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October 06, 2016 11:00 ET (15:00 GMT)
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