Group Financials - Latest Financials

Tourvest was subject to a leverage buyout in September 2008, where a consortium consisting of Guma Tourism (Pty) Ltd (51%), Old Mutual of Southern Africa (Pty) Ltd (31%), Industrial Development Corporation (Pty) Ltd (13%) and Management (5%) purchased the Tourvest business and Tourvest was delisted from the Johannesburg Stock Exchange.

In terms of any leverage buyout the most efficient way for shareholders to finance the company is through shareholders loans rather than share capital. In order for the company to be financially viable (solvent) and meet the expectation of the lenders, etc. these loans, together with interest thereon, are subordinated in favour of all other creditors effectively making these loans the equivalent of share capital. The interest is capitalized and will only be paid once the term debt has been repaid.

Earnings after tax but before non cash costs resulting from the leverage buyout (amortization and shareholders loans interest) was R137.3m compared to prior year loss of R5.6m. The group returned to profitability in 2010 financial year end. The loss in prior year was mainly due to restructuring costs.

The group cash position improved from an overdraft position of R85.8m in 2008 to a positive bank balance of R204.8m in 2010. The decrease in cash position of R37.4m between 2009 and 2010 is due to an additional voluntary repayment of term debt of R76.9m.

In terms of IFRS accounting standards, all goodwill and intangible assets had to be valued at the date of acquisition. Although they have no cashflow impact intangible assets are written off through the income statement.

The annual financial statements of Tourvest are unqualified by the auditors.
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