TRENCOR
  Annual Report 2006     E-mail

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Highlights Commentary Statutory Financials
 

 
FINANCIALS
 
DIRECTORS' REPORT

| General review | Directors and secretary | Directors' interests | Dividends and debenture interest | Conversion of convertible debentures | Strate | Corporate governance  | Interest in significant subsidiaries | Special resolution | Special resolutions of subsidiaries | The Trencor Share Option Plan | Analysis of share and debenture holders

GENERAL REVIEW

The nature of the company’s business is described here. The financial results are reflected in the financial statements.

The net profit/(loss) attributable to the various classes of business of the group was as follows:

2006 2005
RESTATED
RM RM
CONTAINER OPERATIONS
CONTAINER FINANCE 38,3 21,5
TEXTAINER   265,8 270,8
EXCHANGE TRANSLATION GAINS 96,2 132,8
NET LONG-TERM RECEIVABLE ADJUSTMENT 42,3 47,5
TRENSTAR (62,8) (37,3)
INTEREST AND OTHER CORPORATE ITEMS (26,5) (14,9)
DISCONTINUING OPERATIONS 3,0 5,3
EXCEPTIONAL ITEMS   (36,9) (2,2)
319,4 423,5

DIRECTORS AND SECRETARY

The names of the directors and that of the secretary appear on these links.

In terms of the articles of association Messrs N I Jowell, E Oblowitz and H R van der Merwe retire by rotation at the forthcoming annual general meeting but, being eligible, offer themselves for re-election.

Brief résumés of the directors are presented here.

DIRECTORS’ INTERESTS

The aggregate of the direct and indirect interests of the directors in the issued securities of the company at 31 December 2006 and 2005 were as follows:

2006 2005
BENEFICIAL %   13,4 13,6

The direct and indirect interests of each director who held in excess of 1% of the issued securities at 31 December 2006 and 2005 were as follows:

2006 2005
BENEFICIAL %  
C JOWELL 6,6 6,7
N I JOWELL 6,7 6,8

The above changes are as a result of the increase in the number of issued shares following the exercise of options in terms of The Trencor Share Option Plan. There have been no changes in these interests between the financial year-end and the date of this report.

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DIVIDENDS AND DEBENTURE INTEREST

    AMOUNT
    PAYMENT RECORD PAYMENT PER SHARE/
    NUMBER DATE DATE DEBENTURE TOTAL
                    CENTS RM
    DIVIDENDS
    2005 – INTERIM 79 30/09/05 03/10/05 10,0 15,5
        – FINAL   80 07/04/06 10/04/06 30,0 46,8
    2006 – INTERIM 81 29/09/06 02/10/06 20,0 31,3
        – FINAL 82 05/04/07 10/04/07 37,0 58,6
    DEBENTURE INTEREST
    – 6% CONVERTIBLE 29 15/06/06 30/06/06 27,3 7,8
    30 15/12/06 29/12/06 27,3 7,8

CONVERSION OF CONVERTIBLE DEBENTURES

In terms of the trust deed governing the convertible debentures, each debenture will automatically convert into one ordinary share. Such conversion will take place on the last Friday of the fifth month of the financial year following the financial year in respect of which the total dividend declared is equal to or exceeds 54,6 cents per share.

In view of the fact that the total dividend declared in respect of the year ended 31 December 2006 amounted to 57,0 cents per share, each debenture will be converted into one ordinary share on 25 May 2007. A circular containing details with regard to the conversion will be issued to debenture holders in due course.

After conversion of the 28 626 800 debentures, the issued share capital will amount to R935 556 comprising 187 111 117 ordinary shares of 0,5 cent each.

STRATE

 Holders of securities are reminded that paper certificates are no longer good for delivery and those who have not yet dematerialised their holdings are urged to surrender their paper certificates to a selected Central Securities Depository Participant, bank or qualifying stockbroker for conversion into an electronic record, to render them eligible for settlement in the Strate system of electronic settlement on the JSE.

CORPORATE GOVERNANCE

 The report on corporate governance is presented here.

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INTEREST IN SIGNIFICANT SUBSIDIARIES

        AMOUNT
EFFECTIVE   SHARES   OWING TO
INTEREST   AT COST   COMPANY
SHARE CAPITAL    
AND PREMIUM 2006 2005   2006 2005   2006 2005
MILLION % %   RM RM   RM RM
INDIRECT:    
TEXTAINER GROUP HOLDINGS LTD (INCORPORATED IN BERMUDA) OWNING, LEASING AND MANAGING OF CONTAINERS   US$22,8 721 73   – –   – –
TRENSTAR INC (INCORPORATED IN DELAWARE, USA) PROVISION OF MOBILE ASSET MANAGEMENT SERVICES   US$74,9 582 56   – –   – –
DIRECT:    
TRENCOR CONTAINER HOLDINGS (PTY) LTD (INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA) HOLDING COMPANY OF TRENCOR CONTAINERS (PTY) LTD   R4,2 100 100   50,7 50,7   – –
TRENCOR SERVICES (PTY) LTD (INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA) CORPORATE ADMINISTRATION AND FINANCING   R1 012,2 100 100   1 015,7 1 015,0   182,7 134,0
TRENCOR SOLUTIONS (PTY) LTD (INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA) HOLDING COMPANY FOR TRENSTAR INC AND TRENSTAR SA (PTY) LTD     R0,003 100 100   9,0 9,0   0,1 1,1
  1 075,4 1 074,7   182,8 135,1
AGGREGATE OF OTHER SUBSIDIARIES             1,3 1,3   – –
  1 076,7 1 076,0   182,8 135,1
LESS IMPAIRMENT LOSS             (9,0) –   – –
  1 067,7 1 076,0   182,8 135,1
1 Reduced to 72,3% from 72,7% as a result of the exercise of stock options.
2 Pursuant to a capital raising by TrenStar,Trencor’s interest increased to 58%.

A complete list of subsidiary companies is available on request. The interest of the company in their aggregate profits and losses after tax is as follows:

2006 2005
RM RESTATED
RM
PROFITS 448,3 468,2
LOSSES    (118,7) (42,5)
329,6 425,7

SPECIAL RESOLUTION

 At the annual general meeting held on 17 May 2006, shareholders passed a special resolution, which was registered on 25 May 2006, to grant the company a general authority for the acquisition by the company or any of its subsidiaries of shares issued by the company, which authority is valid until the earlier of the next annual general meeting or the variation or revocation of such general authority by special resolution by any subsequent general meeting of the company, provided that it shall not extend beyond fifteen months from the date of passing of the resolution.

SPECIAL RESOLUTIONS OF SUBSIDIARIES

 During the year under review, no special resolutions were passed by the company’s South African subsidiaries nor were any resolutions of material interest passed by the company’s non-South African subsidiaries.

THE TRENCOR SHARE OPTION PLAN

In terms of The Trencor Share Option Plan, options have been granted to certain executive directors and employees amounting in aggregate to 6 740 000 ordinary shares in the unissued share capital of the company. 

MAXIMUM SHARES AVAILABLE FOR UTILISATION UNDER THE PLAN AT THE BEGINNING OF THE YEAR 8 866 709
OPTIONS FORFEITED DURING THE YEAR   17 500
MAXIMUM SHARES AVAILABLE FOR THE PLAN IN RESPECT OF WHICH OPTIONS HAVE NOT BEEN GRANTED AT THE END OF THE YEAR 8 884 209

During 2006 options in respect of 2 564 518 ordinary shares of 0,5 cent each (2005: 1 825 232 shares) were exercised at the offer price of R5,25 per share and, accordingly, the issued share capital increased from R778 187 comprising 155 637 324 shares to R792 109 comprising 158 42 842 shares at 31  December 2006.

Subsequent to the year-end, options in respect of 62 475 ordinary shares were exercised at the offer price of R5,25 per share and, accordingly, the issued share capital was increased to R792 422 comprising 158 484 317 shares.

ANALYSIS OF SHARE AND DEBENTURE HOLDERS

 An analysis of share and debenture holders and of holders who held 5% or more of the issued securities at 31 December 2006 is presented here. 

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