CAF - Canaf Group Inc.

Discussion in 'Stock picks and trading strategies' started by goldismyfriend, Jan 3, 2018.

  1. Canaf Investments earns $623,884 (U.S.) in fiscal 2018

    2019-02-28 08:24 MT - News Release


    Mr. Christopher Way reports

    CANAF ANNOUNCES FINANCIAL RESULTS FOR YEAR ENDED 31 OCTOBER 2018

    Canaf Investments Inc. has released its financial statements, and management discussion and analysis for the year ended Oct. 31, 2018.

    For the year, revenue increased to $14,673,658 (U.S.) from $10,699,117 (U.S.) the previous year, and the corporation recorded a net profit of $623,884 (U.S.) in comparison to $541,808 (U.S.) the previous year. Earnings before interest, taxes, depreciation and amortization for the year was recorded at $1,028,094 (U.S.) or approximately $1.35-million.

    Christopher Way, chief executive officer, states: "The annual results reflect another solid performance from the corporation's majority owned subsidiary, Southern Coal. During they year we successfully completed a strategic and important Broad-Based Black Empowerment transaction and we are now a cash-flow-positive business with zero long-term liabilities. The corporation will continue to focus its attention at making efficiencies within its South African business, as well as looking for new markets and diversification opportunities."

    For more details and discussion on the results, the financial statements and management discussion and analysis can be viewed on SEDAR or the company's website.

    About Canaf Investments Inc.

    Canaf is a public company listed on the TSX Venture Exchange. Canaf's registered office is in Vancouver, B.C., Canada, with subsidiary offices in the United Kingdom and South Africa. Canaf owns 100 per cent of Quantum Screening and Crushing Pty. Ltd., a South African-based company that owns 70 per cent of Southern Coal.

    About Southern Coal

    Southern Coal produces calcined anthracite, a product used primarily as a substitute to coke in sintering processes. Southern Coal produces calcined anthracite by feeding washed anthracite coal through rotary kilns, at temperatures between 900 and 1,100 degrees centigrade; the volatiles are driven off and the effective carbon content increased.

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  2. Canaf Investments Inc. 2018 Year End Results. Financials + MD&A
    Ending October 31st 2018. All information can be found at www.sedar.com

    Q1 2019 result will be released end of March 2019.

    TSXV Symbol: CAF - OCTBB Symbol: CAFZF

    Price: $0.09
    Common Shares: 47,426,195
    Insider Holdings: 12,304,085 or 26% - Majority Owned By CEO & Family
    Warrants/Options: 0
    Website: www.canafgroup.com

    Financials (All In US Dollars)

    ASSETS
    Cash: $552,351
    Trade Receivables: $1,240,730
    Sales Tax Receivable: $4,559
    Inventories: $836,551
    Prepaid Expenses: $21,896
    Property & Equipment: $868,059
    Due From Non-Controlling Interest: $1,250,290
    Intangible: $1
    Total Assets: $4,774,437 (2017 - $3,315,232)

    LIABILITIES
    Trade Payables: $1,088,227
    Income Tax Payable: $11,958
    Bank Loan: $78,412 - Paid Jan 2019 as per the company press release
    Total Liabilities: $1,178,597 (2017 - $1,406,594)

    Asset/Debt Ratio: 4.05:1

    2018 Performance
    Sales: $14,673,658
    Gross Profit: $1,171,328
    Net Income: $298,144

    Canaf Investments has added $737,808USD ($959,150CAD @ 1.30 Exchange) in net income over the last 8 quarters, established new business relationships with the acquisition of their BBEEE certificate that took a long time to receive, are diversifying the company as per the MD&A below, yet the price is still where it was two years ago, thus the price/earnings ratio is also very low. It says below in the MD&A that shareholders equity was pegged at $4.6 million CAD, which is today’s current market cap value. Almost all companies on the TSX/TSXV/CSE trade far beyond this value, thus giving Canaf an even bigger discount for no reason. Read all MD&A information below as there are numerous things happening with the company in 2019. There were also one time expenses such as BBEEE and company name change that increased expenses just for 2018.

    MD&A Highlights (Management Discussion)

    The Corporation reports another strong year of sales and earnings with revenues for the twelve months of $14,673,658 (2017: $10,699,117) a 37.1% increase, and gross profits of $1,171,328 (2017: $1,223,110) a 4.1% decrease. Net income for the year increased 15.1% to $623,884 (2017: $541,808).

    An important achievement of the Corporation during the year was the sale of 30% of Quantum’s shares in Southern Coal for 18 million Rand, which enabled, and contributed, to Southern Coal achieving a Level 4 Broad-Based Black Economic Empowerment (“B-BBEE”) rating. Achieving this rating will enable Southern Coal to engage in long-term supply contracts with its customers. The Corporation can confirm that long-term (24 month) contracts with both its existing main customers should be renewed during Q2 and Q3, 2019.

    During Q1 2019, the Corporation is pleased to confirm that a trial load of its calcined product was delivered to a new potential and significant customer. Trials will be ongoing into Q2 2019, and should this convert to an ongoing supply, the Corporation feels that there is potential to return to the revenue levels of the year ended October 31, 2018.

    The Corporation expects to continue to operate profitably into 2019, however management expects revenues to be significantly reduced in comparison to the year ended October 31, 2018, mostly due to global pressure on the steel and manganese markets, which subsequently filters back to demand for Southern Coal’s product.

    While revenues and net income have grown, gross margin suffered as Southern Coal experienced increased costs of production primarily due to increased cost of its anthracite feedstock material. The Corporation expects its gross margins to remain squeezed into next year. In addition to pressure from suppliers, the Corporation carried out major essential maintenance and re-commissioning during the year on one of its old calcining plants.

    During Q1 2019, Southern Coal made its final payment for the 14 million Rand loan from ABSA bank, which was drawn down in February 2015. Repayment of this loan now releases Southern Coal from monthly installments of approximately 392,000 Rand (approx. C$37,000 or US$28,000), which the Corporation plans to allocate to future diversification or expansion projects. As of January 2019, the Corporation has zero long-term liabilities.

    Whilst the Corporation reports another profitable and financially positive year, the board can confirm that it is actively looking for new opportunities that will offer long-term growth potential for shareholders, be it related to its existing anthracite calcining operation in South Africa or another new, and un-related, sector. With zero long-term debt, a strong balance sheet, and a cash flow positive business in South Africa, the Corporation believes it is in a good position to do so. In the meantime, the Corporation will continue to grow its shareholder’s equity, which as of October 31, 2018, stands at approximately $3.5 million (C$4.6 million).

    BROAD-BASED BLACK ECONOMIC EMPOWERMENT TRANSACTION (B-BBEE)

    As part of Southern Coal’s B-BBEE transformation program, Amandla Amakhulu (Pty) Ltd, (“AAM”), a 100% black, privately owned, and ringfenced, company incorporated in South Africa, acquired 30% of the issued shares of Southern Coal, from Canaf’s wholly owned subsidiary, Quantum, for the value of 18 million Rand. The financial effective date for the transaction is 01 August 2018. Quantum in return received cumulative, redeemable preference shares in AAM in the amount of the purchase price. These preference shares shall provide preferential dividends, until redeemed by AAM. These dividends will be secured by an irrevocable direction from AAM to Southern Coal to pay Quantum such dividends from any distribution to AAM.

    CLAIM AGAINST KILEMBE MINES LIMITED

    In August 2006, Canaf, then known as Uganda Gold Mining, announced the termination of any further investment into its Kilembe Copper-Cobalt Project in Uganda. Since 2007, the Corporation has been engaged in an arbitration with Kilembe Mines Limited, (“KML”), whereby the Corporation seeks general damages, special damages and costs of the arbitration from KML for breach of contract. The legal work, carried out by MMAKS Advocates, Kampala, against KML is at no cost to the Corporation, but any award in won by MMAKS efforts will be distributed to both MMAKS and Canaf. Despite the fact that the claim against KML Corporation remains active, the Corporation is unable to give an indication of either the quantum or any likely date by which the arbitration will be concluded.

    Revenue for the year was $14,673,658 (2017: $10,699,117), 37.1% increase due to high demand for Southern Coal's calcine product from both of its main customers. Sales for the year-end October 31, 2019 are expected to reflect a significant reduction in comparison to the current year, assuming no new customers are secured. The expected reduction in sales is primarily down to global uncertainties in the steel and manganese markets that Southern Coal supplies in to. Despite the expected reduction in sales, management can confirm that it is working on ensuring that gross margins improve by implementing efficiencies in Sothern Coal’s operations.

    Expenses for the year were $587,312 (2017: $504,788) an increase of $82,524, 16.3%, primarily due to increased costs relating to the B-BBEE program ($75,573) and necessary legal and administrative charges in relation to the Corporations name and jurisdiction changes in Canada, offset by reduced interest on the bank loan. The Corporation incurred extra management and consultant fees due to the passing of its previous CFO, Zeny Manalo as well as transitional costs associated with the appointment and resignation of Derick Sinclair, and appointment of Rebecca Williams as CFO during the year. The Corporation does not expect any further extra ordinary management or consultant fees going forward. Additional details of general and admin expenses can be found in the table below.

    Finance Cost for the year were $27,853 (2017 $86,837) a favorable variance of $58,984 (68%) as a result of nearing the end of the loan period.

    At October 31, 2018, the Corporation had cash of $552,351 (October 31, 2017: $453,609) and working capital of $1,477,490 (October 31, 2017: $1,098,726). Surplus cash and cash equivalents are deposited in interest accruing accounts. Working capital components include cash in current or interest bearing accounts, trade and other receivables, sales tax receivable, inventories and prepaid expenses and deposits, trade and other payables, sales tax payable, income tax payable, and current portion of long-term debt. Trade receivables and trade payables are expected to increase or decrease as sales volumes change
     
  3. Canaf Investments earns $187,367 (U.S.) in Q1

    2019-03-26 09:53 MT - News Release


    An anonymous director reports

    CANAF ANNOUNCES FINANCIAL RESULTS FOR Q1 2019

    Canaf Investments Inc. has released results of its financial statements, and management discussion and analysis for the three-month period ended Jan. 31, 2019.

    Revenue for the quarter was recorded at $2,419,633 (U.S.) with a net income of $187,367 (U.S.) or $249,521 (Canadian) (2018 -- $187,126 (U.S.)) and an adjusted earnings before interest, taxes, depreciation and amortization of $319,241 (U.S.) (2018: $176,680 (U.S.)).

    The corporation expects sales to remain as similar levels throughout the rest of the year, whilst it continues to explore opportunities to invest in new projects.

    For more details and discussion on the results, the financial statements and management discussion and analysis can be viewed on SEDAR or the company's website.

    About Canaf Investments Inc.

    Canaf is a public company listed on the TSX Venture Exchange. Canaf's head office is in Vancouver, Canada, with subsidiary offices in the United Kingdom and South Africa. Canaf owns 100 per cent of Quantum Screening and Crushing, a South African-based company that owns 70 per cent of Southern Coal.

    We seek Safe Harbor.

    © 2019 Canjex Publishing Ltd. All rights reserved.
     
  4. Canaf Investments Inc. Q1 2019 Results. Financials + MD&A
    Ending January 31st 2019. All information can be found at www.sedar.com

    TSXV Symbol: CAF - OCTBB Symbol: CAFZF

    Price: $0.09
    Common Shares: 47,426,195
    Insider Holdings: 12,304,085 or 26% - Majority Owned By CEO & Family
    Warrants/Options: 0

    Financials (All In US Dollars)

    ASSETS (Jan 31 2019)
    Cash: $591,414
    Trade Receivables: $1,521,001
    Sales Tax Receivable: $463
    Inventories: $622,443
    Prepaid Expenses: $22,965
    Property & Equipment: $870,984
    Interest Bearing Borrowings: $1,287,458
    Intangible: $1
    Total Assets: $4,916,729

    LIABILITIES
    Trade Payables: $745,700
    Sales Tax Payable: $37,844
    Income Tax Payable: $84,206
    Total Liabilities: $867,750

    Asset/Debt Ratio: 5.67:1

    Q1 2019 Performance
    Sales: $2,419,633
    Gross Profit: $329,519
    Net Income: $187,367
    Foreign Currency Gain: $401,214
    Total Net Income For Q1: $588,581

    2017 Net Income(after currency exchange & taxes): $439,664 USD
    2018 Net Income(after currency exchange & taxes): $298,144 USD
    2019 Q1 Net Income (after currency exchange & taxes): $588,581 USD
    Total Net Income Added In 11 Quarters: $1,326,389 or $1,750,833 based on 1.32 exchange

    MD&A Highlights

    Whilst the Corporation reports another profitable and financially positive quarter, the board can confirm that it is actively looking for new opportunities that will offer long-term growth potential and stability of sales for shareholders, be it related to its existing anthracite calcining operation in South Africa or another new, and unrelated, sector.
    With zero long-term debt, a strong balance sheet, and a cash flow positive business in South Africa, the Corporation believes it is in a good position to do so.

    Sales for the first quarter of 2019 were low compared to the previous quarter in 2018 at $2,419,633 (2018: $3,273,213), a 26% decline, however gross profits grew to $329,519, compared with $248,562 in the same quarter in 2018, a 33% increase. Net income for the quarter remained static at $187,367 (2018: $187,126), but increased from $108,996 the previous quarter. Despite sales reducing during the quarter, gross profit margin increased due to discounted feed material being purchased during the period as well as savings made through acquisition of machinery, which subsequently reduced rental costs for the Corporation. The Corporation expects profit margins to reduce next quarter, and remain squeezed throughout the rest of the year, as Southern Coal continues to manage increased input costs.

    The Corporation expects revenues to be reduced in comparison to the year ended October 31, 2018, mostly due to global pressure on the steel and manganese markets, which subsequently filters back to demand for Southern Coal’s product. During Q1 2019, the Corporation is pleased to confirm that a trial load of its calcined product was delivered to a new potential, and significant, customer. The Corporation hopes to finalise a second trial during Q2 and Q3, and should this convert to an ongoing supply, the Corporation feels that there is potential to return to the revenue levels of the year ended October 31, 2018.

    During Q1 2019, Southern Coal made its final payment for the 14 million Rand loan from ABSA bank, which was drawn down in February 2015. Repayment of this loan now releases Southern Coal from monthly installments of approximately 392,000 Rand (approx. C$37,000 or US$28,000). As of January 2019, the Corporation has zero long-term liabilities.

    As part of Southern Coal’s B-BBEE transformation program, Amandla Amakhulu (Pty) Ltd, (“AAM”), a 100% black, privately owned, and ringfenced, company incorporated in South Africa, acquired 30% of the issued shares of Southern Coal, from Canaf’s wholly owned subsidiary, Quantum, for the value of 18 million Rand. The financial effective date for the transaction is 01 August 2018.

    Quantum in return received cumulative, redeemable preference shares in AAM in the amount of the purchase price. These preference shares shall provide preferential dividends, until redeemed by AAM. These dividends will be secured by an irrevocable direction from AAM to Southern Coal to pay Quantum such dividends from any distribution to AAM. Dividends were declared during the first quarter of $135,441.52

    Expenses for the quarter were $119,276 (2018: $167,892) a reduction of $48,616, 41%, although not separately reported in Q1 of 2018 there are a significant amount of increased costs in relation to BBEEE compared to Q1 ofthis financial year.
     
  5. Canaf Investments registers South African subsidiaries


    2019-04-15 10:50 MT - News Release

    Mr. Christopher Way reports

    CANAF ANNOUNCES NEW SOUTH AFRICAN SUBSIDIARIES

    Canaf Investments Inc. has registered new South African subsidiaries as part of its growth and diversification strategy.

    Canaf has registered a new wholly owned South African subsidiary, Canaf Investments Pty. Ltd., which wholly owns Canaf Estate Holdings Pty. Ltd.

    The new subsidiaries have been registered as part of the corporation's strategy plans, with the intention of creating a diverse corporation focused on sustainable and long-term growth sectors within South Africa. Canaf Investments Pty. will be used to act as a holding company for new South African investment companies.

    CEH will be used to invest in properties primarily within the suburbs of the old Johannesburg CBD; an area that is currently benefiting from significant investment and regeneration projects. The corporation sees investment in real estate in these suburban areas as an opportunity to acquire properties that should experience significant capital growth, whilst yielding healthy rental returns. Examples of major projects close to CEH's target area include Jewel City, Maboneng and Victoria Yards, and one of the major funds to invest in the area is Divercity, http://divercity.co.za.

    The vision for CEH is to acquire, redevelop and hold properties targeting the student and affordable housing market, with the goal to purchase enough critical mass to uplift the entire area, thereby growing the capital value of the properties in the area.

    The Corporation can also confirm the acquisition of CEH's first investment of approximately $150,000, which is expected to yield a 20-per-cent return when fully occupied. Funding is sourced organically through existing cash reserves and local lenders. Canaf plans to develop further opportunities using similar sources of capital.

    About Canaf Investments Inc.

    Canaf is a public company listed on the TSX Venture Exchange. Canaf's registered office is in Vancouver, B.C., Canada, with subsidiary offices in the United Kingdom and South Africa. Canaf owns 100 per cent of Quantum Screening and Crushing Pty. Ltd., a South African-based company that owns 70 per cent of Southern Coal.

    We seek Safe Harbor.

    © 2019 Canjex Publishing Ltd. All rights reserved.
     
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