EXX - Exxaro Resources Limited - Audited group financial results and
EXX
EXX
EXX - Exxaro Resources Limited - Audited group financial results and
unaudited physical information for the year ended 31 December 2011
Exxaro Resources Limited
Registration Number: 2000/011076/06
JSE Share code: EXX
ISIN: ZAE000084992
ADR code: EXXAY
("Exxaro" or "the company" or "the group")
Audited group financial results and unaudited physical information for the
year ended 31 December 2011
Highlights
Lost time injury frequency rate (LTIFR) down 20% to 0,20
MPower scheme testimony to meaningful employee empowerment, distributing over
R1 billion to 9 694 beneficiaries
Revenue increased by 24% to R21,3 billion
Net operating profit up 53% to R4 billion, excluding the impact of impairment
reversals and charges
Headline earnings per share up 40% to 2 098 cents per share
Final dividend of 500 cents per share; total dividend of 800 cents per share
for 2011
Lowlights
Regrettably, three fatalities
Cessation of zinc production at the Zincor refinery
Condensed group income statement (audited)
2011 2010
For the year ended 31 December Rm Rm
Revenue 12 471 10 116
Operating expenses (9 663) (7 628)
Net operating profit 2 808 2 488
Interest income (note 4) 159 116
Interest expense (note 4) (590) (432)
Income from investments 4 2
Share of income from equity-accounted investments 4 668 3 717
Profit before tax (note 2) 7 049 5 891
Income tax expense (note 5) (986) (732)
Profit for the year from continuing operations 6 063 5 159
Profit for the year from discontinued operations (note 6) 1 594 76
Profit for the year 7 657 5 235
Profit attributable to:
Owners of the parent 7 653 5 208
- continuing operations 6 073 5 167
- discontinued operations 1 580 41
Non-controlling interests 4 27
- continuing operations (10) (8)
- discontinued operations 14 35
Profit for the year 7 657 5 235
Condensed group statement of comprehensive income (audited)
2011 2010
For the year ended 31 December Rm Rm
Profit for the year 7 657 5 235
Other comprehensive income:
Exchange differences on translating foreign operations 800 (44)
Cash flow hedges (40) 204
Share of comprehensive income of associates (254) 40
Share of comprehensive income of non-controlling
interests 35 (57)
Net gain recognised in other comprehensive income 541 143
Total comprehensive income for the year 8 198 5 378
Total comprehensive income attributable to:
Owners of the parent 8 159 5 408
- continuing operations 6 641 5 167
- discontinued operations 1 518 241
Non-controlling interests 39 (30)
- continuing operations (6) (12)
- discontinued operations 45 (18)
Total comprehensive income for the year 8 198 5 378
Ordinary shares (million)
- in issue 354 358
- weighted average number of shares 348 347
- diluted weighted average number of shares 353 361
Attributable earnings per share continuing operations
(cents)
- basic 1 745 1 489
- diluted 1 720 1 432
Attributable earnings per share discontinued operations
(cents)
- basic 454 12
- diluted 448 11
Aggregate attributable earnings per share (cents)
- basic 2 199 1 501
- diluted 2 168 1 443
Condensed group statement of cash flows (audited)
2011 2010
For the year ended 31 December Rm Rm
Cash flows from operating activities
- cash retained from operations 6 503 4 106
- net financing costs (94) (256)
- tax paid (502) (430)
- dividends paid (2 123) (1 056)
Cash flows from investing activities
- capital expenditure (4 926) (2 677)
- proceeds from disposal of property, plant and equipment 496 60
- investments in intangible assets (119)
- dividends from investments and equity-accounted
investments 3 525 1 817
- increase in investments (325) (149)
- other 37
Net cash inflow 2 472 1 415
Net cash flows from financing activities
- shares issued 15 29
- increase in non-controlling interests` loans 11 6
- net borrowings repaid (631) (304)
Net increase in cash and cash equivalents 1 867 1 146
Cash and cash equivalents at beginning of year 2 140 1 023
Translation difference on movement in cash and cash
equivalents 158 (29)
Cash and cash equivalents at end of year 4 165 2 140
Cash and cash equivalents classified as non-current
assets held for sale at end of year 3 100
Cash and cash equivalents per Statement of Financial
Position 1 065 2 140
Cash and cash equivalents at end of year 4 165 2 140
Condensed group statement of financial position (audited)
2011 2010
At 31 December Rm Rm
Assets
Non-current assets
Property, plant and equipment 10 695 13 305
Biological assets 66 46
Intangible assets 128 75
Investments in unlisted associates (note 8) 4 764 3 880
Deferred tax 228 726
Financial assets 1 538 1 375
17 419 19 407
Current assets
Inventories 589 3 120
Trade and other receivables 2 763 3 752
Current tax receivable 105 105
Cash and cash equivalents 1 065 2 140
4 522 9 117
Non-current assets classified as held for sale (note 7) 14 979 85
Total assets 36 920 28 609
Equity and liabilities
Capital and reserves
Equity attributable to owners of the parent 23 588 17 437
Non-controlling interests 20 (23)
Total equity 23 608 17 414
Non-current liabilities
Interest-bearing borrowings 2 202 3 644
Non-current provisions 2 166 2 097
Post-retirement employee benefits 133 96
Deferred tax 1 845 1 353
6 346 7 190
Current liabilities
Trade and other payables 3 334 3 057
Interest-bearing borrowings 866 716
Current tax payable 50 147
Current provisions 151 33
4 401 3 953
Non-current liabilities classified as held for sale
(note 7) 2 565 52
Total equity and liabilities 36 920 28 609
Reconciliation of headline earnings (audited)
Gross Tax Net
For the year ended 31 December 2011 Rm Rm Rm
Profit for the year attributable to owners of the
parent 7 653
Adjusted for:
- impairment of property, plant and equipment 516 516
- reversal of impairment of property, plant and
equipment (869) (869)
- gains on disposal of subsidiaries (1) (1)
- gains or losses on disposal of property, plant and
equipment 3 (2) 1
- share of associates` gains or losses on disposal of 2 2
property, plant and equipment
Headline earnings (349) (2) 7 302
Headline earnings from continuing operations (34) 9 6 048
Headline earnings from discontinued operations (315) (11) 1 254
For the year ended 31 December 2010
Profit for the year attributable to owners of the
parent 5 208
Adjusted for:
- impairment of property, plant and equipment 4 (1) 3
- gains or losses on disposal of property, plant and
equipment (26) (26)
- share of associates` gains or losses on disposal of
property, plant and equipment 1 1
Headline earnings (21) (1) 5 186
Headline earnings from continuing operations (39) 5 128
Headline earnings from discontinued operations 18 (1) 58
For the year ended 31 December 2011 2010
Headline earnings per share aggregate (cents)
- basic 2 098 1 495
- diluted 2 069 1 437
Headline earnings per share from continuing operations
(cents)
- basic 1 738 1 478
- diluted 1 714 1 421
Headline earnings per share from discontinued operations
(cents)
- basic 360 17
- diluted 355 16
Group statement of changes in equity (audited)
Other components of equity
Foreign Financial
Share currency instruments Equity-
capital translation revaluation settled
Rm Rm Rm Rm
Balance at 1 January 2010 2 141 802 3 1 241
Profit for the year
Other comprehensive income (43) 203
Share of associates`
comprehensive income (43) 10
Issue of share capital 1 29
Share-based payments movements 148
Non-controlling interests
additional contributions
Dividends paid 2
Balance at 31 December 2010 2 170 716 216 1 389
Profit for the year
Other comprehensive income 800 (40)
Share of associates`
comprehensive income 72 20
Issue of share capital 1 15
Employee share scheme (MPower)
vesting issue of shares 174
Share-based payments movement 23
Non-controlling interests
additional contributions
Transfer to distributable
reserve (3)
Dividends paid 2
Balance at 31 December 2011 2 359 1 585 196 1 412
Final dividend paid per share
(cents) in respect of the 2010
financial year 300
Dividend paid per share (cents)
in respect of the 2011 interim
period 300
Final dividend payable per
share (cents) in respect of
2011 financial year 500
1 Issued to the Kumba Resources Management Share Trust due to options
exercised.
2 The STC on these dividends amounts to Rnil million after taking into
account STC credits.
Group statement of changes in equity (audited)
Attributable
Other Retained to owners of
reserves income the parent
Rm Rm Rm
Balance at 1 January 2010 8 721 12 908
Profit for the year 5 208 5 208
Other comprehensive income 160
Share of associates` comprehensive income 73 40
Issue of share capital 1 29
Share-based payments movements 148
Non-controlling interests additional
contributions
Dividends paid 2 (1 056) (1 056)
Balance at 31 December 2010 12 946 17 437
Profit for the year 7 653 7 653
Other comprehensive income 760
Share of associates` comprehensive income 9 (355) (254)
Issue of share capital 1 15
Employee share scheme (MPower) vesting
issue of shares 174
Share-based payments movement 23
Non-controlling interests additional
contributions
Transfer to distributable reserve (3)
Dividends paid 2 (2 217) (2 217)
Balance at 31 December 2011 9 18 027 23 588
Final dividend paid per share (cents) in
respect of the 2010 financial year
Dividend paid per share (cents) in respect
of the 2011 interim period
Final dividend payable per share (cents)
in respect of 2011 financial year
1 Issued to the Kumba Resources Management
Share Trust due to options exercised.
2 The STC on these dividends amounts to
Rnil million after taking into account STC
credits.
Group statement of changes in equity (audited)
Non-
controlling Total
interests equity
Rm Rm
Balance at 1 January 2010 1 12 909
Profit for the year 27 5 235
Other comprehensive income (57) 103
Share of associates` comprehensive income 40
Issue of share capital 1 29
Share-based payments movements 148
Non-controlling interests additional contributions 6 6
Dividends paid 2 (1 056)
Balance at 31 December 2010 (23) 17 414
Profit for the year 4 7 657
Other comprehensive income 35 795
Share of associates` comprehensive income (254)
Issue of share capital 1 15
Employee share scheme (MPower) vesting issue of
shares 174
Share-based payments movement 2 25
Non-controlling interests additional contributions 8 8
Transfer to distributable reserve (3)
Dividends paid 2 (6) (2 223)
Balance at 31 December 2011 20 23 608
Final dividend paid per share (cents) in respect of
the 2010 financial year
Dividend paid per share (cents)in respect of the 2011
interim period
Final dividend payable per share (cents)in respect of
2011 financial year
1 Issued to the Kumba Resources Management Share Trust due to options
exercised.
2 The STC on these dividends amounts to Rnil million after taking into
account STC credits.
Salient features
2011 2010
Rm Rm
Net asset value per share (Rand) 67 49
Capital expenditure
- incurred 4 926 2 677
- contracted 8 029 6 475
- authorised but not contracted 2 738 2 490
Capital expenditure contracted relating to captive mines,
Tshikondeni, Arnot and Matla, which will be financed by
ArcelorMittal South AfricaLimited (AMSA Limited) and Eskom 90 1
respectively
Contingent liabilities (note 10) 1 198 1 007
Contingent assets (note 11) 82 63
Operating lease commitments 60 132
Operating sublease rentals receivable 4 6
Calculation of movement in net debt
2011 2010
Rm Rm
Net cash inflow 2 472 1 415
- shares issued 15 29
- loans from non-controlling interests 11 6
- share-based payments (2)
- investmentcapitalised to joint venture loan 21
- finance lease 125
- non-cash flow movements in net debt applicable to currency
translation differences of transactions denominated in
foreign currency (8) 187
- non-cash flow movements in net debt applicable to currency
translation differences of net debt items of foreign
entities (151) (126)
Decrease in net debt 2 483 1 511
Notes to the group financial results (audited)
1. Basis of preparation
This condensed report for the year ended 31 December 2011 has been prepared
under the supervision of WA de Klerk (CA)SA, South African Institute of
Chartered Accountants (SAICA) Registration number: 00133273, in accordance
with the International Accounting Standard (IAS) 34 Interim Financial
Reporting, the requirements of the South African Companies Act, No 71 of
2008, as amended, the AC 500 standards issued by the Accounting Practices
Board or its successor and in compliance with the Listings Requirements of
the JSE Limited.
The group financial statements have been prepared on the historical cost
basis excluding financial instruments and biological assets, which are fairly
valued, and conform to International Financial Reporting Standards (IFRS).
The accounting policies adopted are in terms of IFRS and are consistent with
those applied in the annual financial statements for the year ended 31
December 2010.
During 2011 the following accounting pronouncements became effective:
Amended IFRS 1 First-time Adoption of International Financial Reporting,
Amended IFRS 7 Financial Instruments: Disclosures, Amended IAS 1 Presentation
of Financial Statements, Amended IAS 24 Related Party Disclosures and Amended
IAS 34 Interim Financial Reporting. These pronouncements had no material
impact on the accounting of transactions or the disclosure thereof.
The accounting standards, amendments to issued accounting standards and
interpretations, which are relevant to the group, but not yet effective at 31
December 2011, have not been adopted. It is expected that, where applicable,
these standards and amendments will be adopted on each respective effective
date, except where specifically identified. The group continuously evaluates
the impact of these pronouncements.
2. Profit before tax
2011 2010
For the year ended 31 December Rm Rm
Profit before tax is arrived at after:
Continuing operations
Depreciation, and amortisation of intangible assets (735) (663)
Net realised foreign currency exchange gains/(losses) 177 (30)
Net unrealised foreign exchange (losses)/gains (20) 6
(Losses)/gains on derivative instruments held for trading (154) 152
Fair value gains adjustment on financial instruments 11 10
Impairment reversals/(charges) and write-offs of trade and
other receivables 228 (44)
Royalties (41) (50)
Surplus on disposal of property, plant and equipment 38 48
Discontinued operations
Depreciation, and amortisation of intangible assets (468) (717)
Net realised foreign currency exchange gains/(losses) 361 (95)
Net unrealised foreign exchange gains/(losses) 35 (36)
Gains/(losses) on derivative instruments held for trading 196 300
Fair value gains adjustment on financial instruments 3 3
Impairment reversals/(charges) of property, plant and
equipment(note 3) 353 (4)
Impairment charges and write-offs of trade and other
receivables (2) (1)
Write-down to net realisable value of inventories (1) (50)
Royalties (100) (64)
Deficit on disposal of property, plant and equipment (37) (16)
3. Impairment reversals/(charges)
Impairment of property, plant and equipment (516)
Impairment of property, plVideo
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