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Johannesburg - Investment holding company Hosken Consolidated Investments on Friday reported that its diluted headline earnings per share for the six months ended September were at 100.67 cents, down 16.9% from 121.07 cents restated for September 2008.
Directors decided not to declare any dividends.
Revenue was at R4.167bn, up 35.3% from the R3.080bn restated for September 2008.
Profit for the year from continuing operations was at R622.736m, up 28.1% from the R486.257m restated for the previous period.
Hosken said these results were not directly comparable to the results for the six months ended September 30 2008 due to the occurrence of the following once off non-recurring events:
- Fair value losses incurred and reported in the prior comparable period due to the mark to market of Tsogo Sun's initial investment in Gold Reef Resorts;
- Fair value losses resulting from the collapse of Lehman Brothers reported in the prior comparable period resulting in impairment of natural gas put options held by Montauk; and
- The consolidation of the Seardel Group in the second half of financial year 2009, whose results are fully consolidated in the period under review but not in the prior comparable period.
It said finance costs for the period had increased significantly primarily as a result of the increased level of group borrowings, due to the consolidation of the Seardel Group and the increase in borrowings in the second half of financial 2009, the majority of which was used to increase HCI's interest in Tsogo Sun.
Hosken said undoubtedly the star of its performers in the current period had been its media assets.
"Adspend on eTV continued to rise steadily. eNews has passed its breakeven point and is expected to make its first contributions to profits for the second half of the year," it said.
"Equally significant, the group has extended its mediums to broadcast four channels; eTV, eNews, eAfricaTV and most recently eAfrica News which had been launched as a three hour per day block, but which will be further developed towards the goal of a 24-hour continental news channel."
Hosken said the financial results for the six months to September 2009 reflect the continued difficult trading conditions under which the Tsogo Sun Group was operating, particularly in the Hotel division both locally and offshore.
The Tsogo Sun Gaming division continues to outperform other operators in South Africa in terms of Ebitdar margin, said Hosken, noting that the Gauteng province had been under pressure, recording a 4.8% decline for the six months, whilst Montecasino recorded a 1% growth in gaming win, indicating that the Montecasino catchment area was not as affected as other regions within Gauteng.
The KwaZulu-Natal market has continued to hold up reasonably well during the period under review, with Suncoast casino further benefiting from improved trading at the Suncoast Hotel & Towers. Additional slots have been added and parking created at this unit to assist peak period capacity.
Regarding its transport division, Hosken said Golden Arrow Bus Services had experienced a significant decline in the number of passengers being carried, which is undoubtedly the consequence of the overall decline in economic activity in Cape Town during the current recessionary conditions.
"This has obliged the company to manage its costs even more tightly as well as obliging it to restrict capital expenditure on further new buses.
"The company remains in discussions around the Integrated Rapid Transport System and our participation therein. There are undoubtedly serious problems still to be resolved but we remain committed to attempt to arrive at a sensible outcome that respects everyone's rights and works fairly for all concerned," it said.
- I-Net Bridge
