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ANNUAL FINANCIAL STATEMENTS
- Directors' Report
- Directors' Responsibility statement
- Certificate by the Company Secretary
- Audit committee report
- Independent Auditor’s report
- Group Financial Statements
- Operational Segmental Analysis
- Accounting policies
- Notes to the annual financial statement
- Company Financial Statements
- Interest in subsidiary companies
Directors' Report
The directors have pleasure in presenting their report together with the group and company financial statements for the year ended 31 August 2009.
Nature of business
The company is an investment holding company listed in the Food and Drug Retailers sector of the JSE Limited. The name was changed from New Clicks Holdings Limited to Clicks Group Limited and the company was reclassified from the Consumer Services: General Retailers sector to the Food and Drug Retailers sector on the JSE Limited with effect from 22 June 2009. Its subsidiaries comprise the country’s leading provider of health and beauty merchandise through a network of 540 stores in southern Africa. The company’s subsidiaries cover the pharmaceutical supply chain from wholesale distribution to retail pharmacy as well as music, entertainment and beauty and cosmetic products.
Group financial results
The results of operations for the year are set out in the consolidated income statement. The profit attributable to ordinary shareholders for the year is R473 million (2008: R441 million – restated).
Share capital
In terms of the specific authority granted by shareholders in the general meeting held on 29 May 2009 as contemplated in section 221 of the Companies Act No. 61 of 1973 (as amended), the company elected to issue 207 850 shares for a subscription price of 1 cent and a premium thereon of R356.99 each to New Clicks South Africa (Proprietary) Limited in order to raise cash to make distributions to its shareholders.
The following ordinary shares of 1 cent each, held as treasury shares by a subsidiary of the company, were bought back by the company and cancelled.
| 21 500 000 | cancelled on 3 February 2009 |
During the year under review the company continued with its share buy-back programme as set out below.
| 27 606 047 | shares held by a subsidiary of the company as treasury shares at 1 September 2008 | |
| 19 335 709 | shares in terms of general repurchases between 1 September 2008 and 31 August 2009 by a subsidiary of the company | |
| (392 876) | shares utilised pursuant to the company’s obligations to deliver ordinary shares to Share Trust participants in respect of share options granted | |
| (21 500 000) | shares bought back into the company and cancelled on 3 February 2009 | |
| 25 048 880 | held by a subsidiary of the company as treasury shares at 31 August 2009 |
The company resolved in general meeting on 29 May 2009 to make an offer to those shareholders holding less than 100 shares each in the ordinary shares of the company to acquire their shares by way of an odd-lot offer. The implementation of the odd-lot offer was finalised on 26 June 2009. The company purchased 5 674 shares from shareholders who accepted or were deemed to have accepted the company’s offer to purchase their shares by way of the odd-lot offer. The shares were purchased by the company at R17.41 per share. These shares were delisted and restored to the status of authorised but unissued share capital. The number of Clicks shareholders was reduced by 310. The number of ordinary shares which continued to be held by odd-lot holders who elected to retain their odd-lot holdings was 2 658.
Distributions to shareholders
Interim
The directors approved a distribution of 24.5 cents per share comprising a capital reduction distribution out of share premium of 24.5 cents per share (2008: 18.8 cents per share) in lieu of a dividend (“the distribution”). The distribution was paid on 13 July 2009 to shareholders registered on 10 July 2009.
Final
The board of directors has approved a final distribution of 59.5 cents per share (2008: 42.3 cents per share). The source of such distribution will be a capital reduction out of share premium. The dividend will be payable on 25 January 2010 to shareholders registered on 15 January 2010.
Events subsequent to balance sheet date
No significant events, other than the declaration of the final distribution, as set out above, took place between the end of the financial year under review and the date of this report.
Directors and secretary
The names of the directors in office at the date of this report are set out here, and the company secretary’s details are set out here.
Appointments
John Bester was appointed as an independent non-executive director on 1 October 2008. Annalize Booysen served as company secretary on an interim basis between 1 April 2009 and 30 June 2009. David Janks was appointed head of group legal counsel and company secretary with effect from 1 July 2009.
Resignations and retirement
Robert Lumb resigned as a non-executive director on 30 November 2008. Peter Eagles resigned as a non-executive director on 29 June 2009. Allan Scott retired as company secretary with effect from 31 March 2009.
Retirement and re-election of directors
In accordance with the company’s articles of association David Nurek, Keith Warburton and Fatima Jakoet retire by rotation at the forthcoming annual general meeting. The retiring directors, being eligible, offer themselves for re-election.
Directors' interest in shares
Details of the directors' beneficial interests in the company’s issued share capital are given here.
There have been no new awards of share options since August 2005. Michael Harvey during the year took delivery of and subsequently sold 375 000 shares with an option price of R6.30 which were previously allocated and exercised in August 2003. David Nurek at 31 August 2009 held 500 000 options with a delivery price of R9.30 which were previously allocated and exercised in September 2000.
The only change in these interests between the end of the company’s financial year and 12 November 2009, being a date not more than 1 month prior to the date of notice of the annual general meeting, is the delivery 500 000 shares of which 300 000 shares were sold and 200 000 shares were taken delivery of via a family trust and the purchase by John Bester via a family trust of 10 000 shares.
Share incentive schemes
Information relating to the share incentive scheme is set out here.
Special resolutions
Special resolutions passed at the general meeting held on 29 May 2009 and registered on 5 June 2009:
Special resolution number 1: Approval of the change of the company’s name
Special resolution number 2: Amendment to the articles of association in terms of the odd-lot offer
Special resolution number 3: Adoption of amended articles of association
Special resolution number 4: Specific authority to repurchase shares
Special resolution number 5: Specific authority to issue and allot shares
Holding company
The company has no holding company.
Subsidiary companies
The names of the company’s main subsidiaries and financial information relating thereto appear here.
The interest of the company in the aggregate income after taxation is R473 million (2008: R442 million – restated).