EXCELSIOR CAPITAL LTD — Annual Report 2012

Aug 21, 2012

CMI Limited

Results For Announcement To The Market For the Financial Year Ended 30 June 2012

Preliminary Final Report of CMI Limited for the Financial Year Ended 30 June 2012

(ABN 98 050 542 553)

This Preliminary Final Report is provided to the Australian Stock Exchange (ASX) under ASX Listing Rule 4.3A.

Current Reporting Period: Financial Year Ended 30 June 2012 Previous Corresponding Period: Financial Year Ended 30 June 2011

1

CMI Limited

Results For Announcement To The Market For the Financial Year Ended 30 June 2012

Revenue and Net Profit/(Loss)

Revenue and Net Profit/(Loss)
Revenue from continuing operations Up Net profit attributable to members from continuing operations Down Net profit after tax attributable to members from continuing operations Down	Percentage Change % Amount $’000
	12% to 114,897 38% to 11,571 60% to 5,325

Dividends (Distributions)

Final dividend - Ordinary Interim dividend - Ordinary Interim dividend – Class A Record date for determining entitlements to the dividend: Final dividend - Ordinary	Amount per security Franked amount per security -¢ -¢ -¢ -¢ -¢ -¢ Not Applicable

• Final dividend - Ordinary

Brief Explanation of Revenue, Net Profit/(Loss) and Dividends (Distributions)

The directors of CMI Limited announce today revenue of $114,897 thousand, an increase of 12% on prior year, and a profit after tax of $5,325 thousand.

A summary of all segment results can be found in Note 10 Segment reporting.

The Directors have resolved not to pay a final dividend to Ordinary shareholders.

Net Tangible Assets Per Ordinary Security

Net Tangible Assets Per Ordinary Security
Net tangible assets per ordinary security	2012 2011
	$1.06 $1.69

2

CMI Limited

Consolidated Statement of Comprehensive Income For the Financial Year Ended 30 June 2012

Continuing Operations Revenue Other income Changes in inventories Raw materials expense Sub-contractors expense Employee benefits expense Repairs, maintenance and consumables expense ASX and share register expense Occupancy expense Travel and communication expense Freight and cartage expense Depreciation and amortisation expense Borrowing costs Impairment expense Other expenses from ordinary activities Profit/(Loss) from continuing operations before income tax expense Income tax Profit/(Loss) from continuing operations after income tax expense Profit/(Loss) from discontinued operations net of income tax Profit/(Loss) for the year Other comprehensive income Foreign currency translation Other comprehensive income for the year, net of tax TOTAL COMPREHENSIVE INCOME FOR THE YEAR Profit/(Loss) for the year is attributable to the owners of the parent Total comprehensive income for the year is attributable to the owners of the parent Earnings Per Share from continuing operations: Basic (cents per share) Diluted (cents per share) Earnings Per Share from continuing and discontinuing operations: Basic (cents per share) Diluted (cents per share)	Note 2(a) 2 11 7 7	2012 $’000 2011 $’000
		114,897 102,266 580 2,733 2,660 4,291 (66,029) (61,707) (795) (1,182) (13,726) (12,839) (904) (841) (125) (87) (4,202) (3,249) (1,924) (2,208) (4,599) (4,503) (1,433) (1,099) (183) (175) (9,270) - (3,376) (2,593)
		11,571 18,807 (6,246) (5,487)
		5,325 13,320 - -
		5,325 13,320 76 (166)
		76 (166)
		5,401 13,154
		5,325 13,320
		5,401 13,154
		15.78 39.46 15.71 39.46 15.78 39.46 15.71 39.46

Notes to the financial statements are included on pages 7 to 22

3

CMI Limited

Consolidated Statement of Financial Position

As At 30 June 2012

Current Assets Cash and cash equivalents Trade and other receivables Inventories Total Current Assets Non-Current Assets Property, plant and equipment Other financial assets Goodwill Other intangible assets Deferred tax assets Total Non-Current Assets Total Assets Current Liabilities Trade and other payables Borrowings Current tax payables Provisions Total Current Liabilities Non-Current Liabilities Borrowings Provisions Total Non-Current Liabilities Total Liabilities Net Assets Equity Issued capital Reserves Accumulated profits / (losses) Total Equity	Note 5 13 12	2012 $’000 2011 $’000
		5,622 16,099 20,847 18,276 27,635 24,976
		54,104 59,351
		5,282 4,809 - 8,500 6,850 6,850 2,756 2,292 543 455
		15,431 22,906
		69,535 82,257
		11,363 9,939 7,664 271 3,609 4,455 1,362 1,316
		23,998 15,981
		173 113 124 128
		297 241
		24,295 16,222
		45,240 66,035
		37,227 70,103 6,832 76 1,181 (4,144)
		45,240 66,035

Notes to the financial statements are included on pages 7 to 22

4

CMI Limited

Consolidated Statement of Changes in Equity For the Year Ended 30 June 2012

At 1 July 2010 Profit/(Loss) for the period Net foreign exchange differences Total comprehensive income for the year Transactions with owners in their capacity as owners At 1 July 2011 Profit/(Loss) for the period Net foreign exchange differences Total comprehensive income for the year Transactions with owners in their capacity as owners Class A share cancellation Class A share balance moved to reserve Equity adjustment on loan repayments At 30 June 2012	Issued Capital Reserves Retained Earnings/ Accumulated Losses Total Equity $’000 $’000 $’000 $’000
	70,103 242 (17,464) 52,881
	- - 13,320 13,320 - (166) - (166)
	- (166) 13,320 13,154
	70,103 76 (4,144) 66,035
	- - 5,325 5,325 - 76 - 76
	- 76 5,325 5,401 - - - - (26,844) - - (26,844) (6,032) 6,032 - - - 648 - 648
	37,227 6,832 1,181 45,240

Notes to the financial statements are included on pages 7 to 22

5

CMI Limited

Consolidated Cash Flow Statement For the Financial Year Ended 30 June 2012

Cash Flows From Operating Activities Receipts from customers Payments to suppliers and employees Interest and other costs of finance paid Income tax paid Insurance recovery relating to fire Net cash provided by/(used in) operating activities Cash Flows From Investing Activities Interest received Payment for property, plant and equipment Proceeds from sale of property, plant and equipment Payment for other intangible assets Net cash provided by/(used in) investing activities Cash Flows From Financing Activities Payment of finance liabilities Proceeds from share loan repayment Proceeds from borrowings Payment for share buyback Net cash provided by/(used in) financing activities Net Increase/(Decrease) In Cash and Cash Equivalents Cash and Cash Equivalents At The Beginning Of The Financial Year Effects of exchange rate changes on the balance of cash held in foreign currencies Cash and Cash Equivalents At The End Of The Financial Year	Note 5(d) 5(a)	2012 $’000 2011 $’000
		114,895 106,439 (97,998) (97,668) (157) (119) (7,179) (3,438) - 2,525
		9,561 7,739
		1,069 1,714 (1,258) (1,387) 56 130 (1,140) (901)
		(1,273) (444)
		(311) (242) 648 7,740 - (26,844) -
		(18,767) (242)
		(10,479) 7,053 16,099 9,052 2 (6)
		5,622 16,099

Notes to the financial statements are included on pages 7 to 22

6

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

Note Contents

• 1 Basis of Preparation

• 2 Profit from Operations

• 3 Subsequent Events

• 4 Commentary

• 5 Notes to the Cash Flow Statement

• 6 Details relating to Dividends (Distributions)

• 7 Earnings Per Share

• 8 Business Combination

• 9 Contingent Liabilities and Contingent Assets

• 10 Operating Segments

• 11 Reconciliation of Income Tax Expense

• 12 Issued Capital

• 13 Other Financial Assets

• 14 Other Significant Information

• 15 Information on Audit or Review

7

CMI Limited

Notes to the Financial Statements

For the Financial Year Ended 30 June 2012

1. Basis of Preparation

This preliminary final report has been prepared in accordance with ASX Listing Rule 4.3A and the disclosure requirements of ASX Appendix 4E.

This condensed financial report has been prepared in order to comply with ASX listing rules.

This report does not include all notes of the type normally included within the annual financial report and therefore cannot be expected to provide as full an understanding of the financial performance, financial position and financing and investing activities of the consolidated entity as the full financial report.

It is recommended that this report be read in conjunction with the annual report for the year ended 30 June 2011, the interim financial report for the half-year ended 31 December 2011 and considered together with any public announcements made by CMI Limited during the year ended 30 June 2012 in accordance with the continuous disclosure obligations of the ASX listing rules.

The accounting policies and methods of computation are the same as those adopted in the most recent annual financial report.

Prior period comparatives have been adjusted where required to meet current year presentation format.

8

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

012
2012	2011
$’000	$’000

2. Profit From Continuing Operations

Profit from continuing operations before income tax includes the following items of revenue and expense:

(a) Revenue and Other Income – continuing operations Continuing operations Sales of goods Interest – other persons Insurance recovery relating to fire Other Items (b) Profit before income tax – continuing operations Profit before income tax has been arrived at after crediting/(charging) the following gains and losses from continuing operations: Gain/(loss) on disposal of property, plant and equipment Net foreign exchange gains/(losses) Profit before income tax from continuing operations has been arrived at after charging the following expenses: Cost of sales Net bad and doubtful debts Depreciation and amortisation of: Property, plant and equipment Leased assets Brand names Other intangibles Impairment Expense: Loan receivable Interest Receivable	113,158 100,313 1,739 1,953
	114,897 102,266
	- 1,983 580 750
	580 2,733
	1 27 72 (98)
	73 (71)
	68,039 63,229 45 56 700 624 52 37 - - 681 438
	1,433 1,099
	8,500 - 770 -
	9,270 -

9

CMI Limited

Notes to the Financial Statements

For the Financial Year Ended 30 June 2012

3. Subsequent Events

There has not been any other matter or circumstance, in the financial statements or notes thereto, that has arisen since the end of the period, that has significantly affected, or may significantly affect, the operations of the consolidated entity, the results of those operations, or the state of affairs of the consolidated entity in future financial years.

4. Commentary

Continuing operations comprise the Electrical Division and TJM Products Division.

The Electrical Division produced a pre-tax profit of $21.5m, an increase of $5.5m on the 2011 year. Revenue increased to $73.8m, 19% (or $12.0m) up on last year.

The Electrical Division business unit produced strong results particularly in the first half of the year with mining remaining a strong market throughout the whole year. The Electrical Division continues to work on the introduction of new products along with improvements to its existing proprietary product range.

The TJM Products Division produced a pre-tax profit of $1.0m, a decrease of $1.8m on the 2011 year. The pre-tax profit for the prior year included $2.0m relating to insurance recoveries less expenses as a result of the fire at the Geebung premises. Revenue (excluding intercompany sales) increased to $39.5m, 3% (or $1.0m) up on last year.

A new General Manager was appointed to the TJM Products business unit in late February and has begun implementing efficiency and productivity improvement plans together with revising strategies for sales volume increases across the business unit. In particular, the new management of TJM is focused on improvements in the areas of time to market of product designs, supply chain and distribution relationships.

10

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

2012	2011
$’000	$’000

5. Notes to the Cash Flow Statement

(a) Reconciliation of Cash

For the purposes of the cash flow statement, cash and cash equivalents includes cash on hand and in banks and investments in money market instruments, net of outstanding bank overdrafts. Cash and cash equivalents at the end of the financial year as shown in the cash flow statement is reconciled to the related items in the statement of financial position as follows:

Cash and cash equivalents Cheque Accounts Term Deposit Bank overdraft	5,622 6,954 - 9,145
	5,622 16,099
	- -
	5,622 16,099

(b) Non-Cash Financing and Investing Activities

During the financial year, the consolidated entity acquired plant and equipment with an aggregate fair value of $240 thousand (2011: $nil thousand) by means of finance leases. These acquisitions are not reflected in the cash flow statement.

(c) Financing Facilities

An overdraft and bill acceptance/discount facility with the National Australia Bank, reviewed annually, is secured by a fixed and floating charge over the assets and undertaking of the consolidated entity:

Amount used Amount unused (d) Reconciliation of Profit for the Period to Net Cash Flows From Operating Activities Profit/(loss) for the period (Gain)/loss on sale of non-current assets Depreciation and amortisation of non-current assets Interest income received and receivable Finance lease interest Unrealised Foreign Exchange (Gain)/Loss Impairment of non-current assets Increase/(decrease) in current tax liability Increase/(decrease) in deferred tax Changes in net assets and liabilities, net of effects from acquisition of businesses: (Increase)/decrease in assets: Current receivables Current inventories Increase/(decrease) in liabilities: Current payables Current provisions Non-current provisions Net cash from operating activities	7,500 - 3,500 9,000
	11,000 9,000
	5,325 13,320 - (27) 1,433 1,099 (1,739) (1,715) 24 39 1 (13) 9,270 - (846) 1,954 (88) 40 (2,856) (3,120) (2,541) (4,439) 1,467 485 91 72 20 44
	9,561 7,739

11

CMI Limited

Notes to the Financial Statements

For the Financial Year Ended 30 June 2012

6. Details Relating to Dividends (Distributions)

				Amount
				per
				security
			Franked	of
		Amount	Amount	foreign
		per	per	sourced
		security	security	dividend
		¢	¢	¢
Final dividend – Ordinary	2012	-	-	N/A
Interim dividend – Ordinary	2012	-	-	N/A
Interim dividend–Class A	2012	-	-	N/A
Interim dividend – Ordinary	2011	-	-	N/A
Final dividend – Ordinary	2011	-	-	N/A
Interim dividend – Class A	2011	-	-	N/A
Finaldividend–ClassA	2011	-	-	N/A
Total dividend (distribution) per security (interim plus final)
		2012		2011
		¢		¢
Ordinary securities (each class separately)		-		-
Class A (each class separately)		-		-
Interim and final dividend (distribution)	on all	securities
		2012		2011
		$’000		$’000
Ordinary securities (each class separately)			-	-
Class A (each class separately)			-	-
Total			-	-

Any other disclosures in relation to dividends (distributions).

The Directors have proposed to not pay an interim or final dividend in respect of Ordinary shares for the year ended 30 June 2012.

12

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

6. Details Relating to Dividends (Distributions) (continued)

Dividend Reinvestment Plans

The dividend or distribution plans shown below are in operation.

Not applicable

The last date(s) for receipt of election notices for the dividend or distribution plans

Not applicable

7. Earnings Per Share – continuing operations

Basic EPS Diluted EPS	2012 ¢ per share 2011 ¢ per share
	15.78 39.46 15.71 39.46

Basic Earnings per Share

The earnings and weighted average number of ordinary shares used in the calculation of basic earnings per share are as follows:

Earnings (a) Weighted average number of ordinary shares (b)	2012 $’000 2011 $’000
	5,325 13,320
	2012 No. ‘000 2011 No. ’000
	33,753 33,753

• (a) Earnings used in the calculation of basic earnings per share reconciles to net profit/(loss) in the statement of comprehensive income as follows:

statement of comprehensive income as follows:
Net profit/(loss) Class A share dividends provided for or paid Earnings used in the calculation of basic EPS	2012 $’000 2011 $’000
	5,325 13,320 - -
	5,325 13,320

• (b) Options are considered to be potential ordinary shares and are therefore excluded from the weighted average number of ordinary shares used in the calculation of basic earnings per share. Where dilutive, potential ordinary shares are included in the calculation of diluted earnings per share (refer below).

13

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

7. Earnings Per Share – continuing operations (continued)

Diluted Earnings per Share

The earnings and weighted average number of ordinary and potential ordinary shares used in the calculation of diluted earnings per share are as follows:

Earnings (a) Weighted average number of ordinary shares and potential ordinary shares (b), (c)	2012 $’000 2011 $’000
	5,325 13,320
	2012 No. ‘000 2011 No. ‘000
	33,987 33,753

• (a) Earnings used in the calculation of diluted earnings per share reconciles to net profit/(loss) in the statement of comprehensive income as follows:

the statement of comprehensive income as follows:
Net profit/(loss) Class A share dividends provided for or paid Earnings used in the calculation of diluted EPS	2012 $’000 2011 $’000
	5,325 13,320 - -
	5,325 13,320

• (b) Weighted average number of ordinary shares and potential ordinary shares used in the calculation of diluted earnings per share reconciles to the weighted average number of ordinary shares used in the calculation of basic earnings per share as follows:

Weighted average number of ordinary shares used in the calculation of basic EPS Shares deemed to be issued for no consideration in respect of: Director options Weighted average number of ordinary shares and potential ordinary shares used in the calculation of diluted EPS	2012 No. ‘000 2011 No. ‘000
	33,753 33,753 144 -
	33,897 33,753

• (c) Share options are included on the basis that they are dilutive.

14

CMI Limited

Notes to the Financial Statements

For the Financial Year Ended 30 June 2012

8. Business Combination

Control gained over entities

Year	Name of entity (or group of entities)	Date control gained	% Acquired
2012	Nil	Nil	Nil
2011	TJM Off-Road Products Inc.	08/04/2011	100%

During the year ended 30 June 2011 the group incorporated TJM Off-road Products Inc. with an investment of USD $100 thousand.

9. Contingent Liabilities and Contingent Assets

2012 2011 $’000 $’000 Contingent liabilities Guarantees issued to bank in respect of overseas purchases and lease of premises 1,586 1,837

Australian Taxation Office Audit

The Australian Taxation Office has confirmed the audit of CMI Limited relating to the years 2004-2009 has been finalised with no adjustments made to taxation returns previously lodged. This finalises the audit.

Litigation

Trojan Equity Limited (“Trojan”) had initiated legal proceedings in the Supreme Court of Queensland against CMI Limited, the personal representatives of CMI’s former executive directors Raymond Catelan (deceased) and Richard Catelan, CMI’s current directors Colin Ryan, Leanne Catelan and Danny Herceg and various shareholders of CMI Limited. Trojan had applied to the Court for a range of relief including an order that CMI be wound up, damages and an account of profits.

During the period, Trojan Equity Limited has released and discharged CMI from all and any claims, actions, suits or demands and the proceedings have been dismissed.

Guarantees over CMI Industrial Premises Leases

CMI Limited has provided guarantees in respect of certain land and buildings leased by CMI Industrial Pty Ltd which were granted prior to the sale of the engineering division to CMI Industrial Pty Ltd by CMI Limited. The lessors under those leases may look to CMI for any unpaid amounts due by Industrial under those leases. A payment of $213 thousand was made relating to these guarantees during the year and resulted in a Deed of Release being finalised for one property. At this stage, no additional claims which would result in net cash outflows by CMI Limited have been received.

15

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

Contingent assets (a & b)

(a) Option to Purchase

Associated with the sale of the Engineering business and a vendor loan provided by CMI Limited was an option granted to CMI Limited to purchase a portion of the entity that acquired the Engineering business should certain trigger events such as failure to repay the vendor loan, failure to transfer certain leases or failure to settle creditors occur. This option was originally in existence for three years, expiring in April 2011 or less should the vendor loan be repaid. This option was extended along with the repayment date of the receivable by 6 months. Exercise of the option by CMI Limited would require the surrender of the vendor loan. The directors have assessed the fair value of this option as $nil at 30 June 2012.

(b) TJM Warehouse Fire

On 16 October 2009 a fire took place at the head office of the TJM business Unit. As a result of this fire the TJM and Corporate business units of CMI Limited incurred interruptions to business and trading activities. The CMI Limited Group carries appropriate and adequate Fire and Business Interruption insurance for these events and disruptions.

A claim for Material Damage, Additional Increased Cost of Working and Loss of Gross Profit incurred between October 2009 and June 2011 has been finalised with CMI’s insurers. There is no receivable as at 30 June 2012. During the 2011 financial year, the insurers made final payments on account totalling $2.5 million.

Commitments

TJM Off-Road Products Inc. (USA) Capital Commitment

At 30 June 2011 CMI Limited had a commitment to contribute A$82,876 (US$89,000) in capital. The commitment relates to contributions to the registered capital of the company in accordance with TJM Off-Road Products Inc. articles of association which stated on incorporation CMI Limited had a commitment to contribute US$100,000. This amount was contributed during the current year.

16

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

10. Operating Segments

	CONTINUING OPERATIONS	CONTINUING OPERATIONS	CONTINUING OPERATIONS
BUSINESS	TJM Products – Australia & USA TJM Products – China		TJM Products – Total Electrical Components	Consolidated
	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000	30/06/11 $’000	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000	30/06/12 $’000 30/06/11 $’000
REVENUE External sales – Domestic 27,174 29,157 - - 27,174 29,157 73,759 61,830 External sales – Export 11,320 8,886 997 491 12,317 9,377 - - Intersegment sales (i) - - 3,042 2,522 3,042 2,522 - - Total Segment Revenue 38,494 38,043 4,039 3,013 42,533 41,056 73,759 61,830 Interest income Inter-segment eliminations Total revenue per the statement of comprehensive income RESULT Segment result 976 2700 44 66 1,020 2,766 21,540 15,975 Reconciliation of segment net profit before tax to net profit/(loss) after tax per the statement of comprehensive income Interest income Employee benefits ASX and share register expense Borrowing costs Impairment expense Other expenses from ordinary activities Income tax expense Profit after tax per the statement of comprehensive income	27,174 29,157 - 11,320 8,886 997 - - 3,042	- 491 2,522	27,174 29,157 73,759 61,830 12,317 9,377 - - 3,042 2,522 - -	100,933 90,987 12,317 9,377 3,042 2,522
	38,494 38,043 4,039	3,013	42,533 41,056 73,759 61,830	116,292 102,886
				1,647 1,902 (3,042) (2,522)
				114,897 102,266
				22,560 18,741 1,647 1,902 (941) (977) (125) (87) (159) (136) (9,270) - (2,141) (636) (6,246) (5,487)
	976 2700 44	66	1,020 2,766 21,540 15,975
				5,325 13,320

i) Inter-entity sales are recognised based on an internally set transfer price of goods at cost plus a margin.

ii) Corporate charges and income tax expense are not allocated to each business segment

17

CMI LIMITED NOTES TO THE FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 30 JUNE 2012 (CONTINUED)

10. Operating Segments (continued)

BUSINESS	TJM Products – Australia & USA TJM Products – China TJM Products – Total Electrical Components	Consolidated
	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000	30/06/12 $’000 30/06/11 $’000
SEGMENT ASSETS Segment assets 26,948 20,966 1,349 2,151 28,297 23,117 37,823 37,637 Reconciliation of segment assets to the statement of financial position Cash and cash equivalents Other financial assets Future income tax benefits Property, Plant & Equipment Other assets Intersegment Eliminations Total assets from continuing operations per the statement of financial position	26,948 20,966 1,349 2,151 28,297 23,117 37,823 37,637	66,120 60,754 2,881 11,625 - 8,500 418 325 7 6 109 674 - 373
		69,535 82,257

18

CMI LIMITED NOTES TO THE FINANCIAL STATEMENTS

FOR THE FINANCIAL YEAR ENDED 30 JUNE 2012 (CONTINUED)

10. Operating Segments (continued)

10. Operating Segments (continued)	10. Operating Segments (continued)	10. Operating Segments (continued)	10. Operating Segments (continued)
BUSINESS	TJM Products – Australia & USA TJM Products – China	TJM Products – Total Electrical Components	Consolidated
	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000	30/06/12 $’000 30/06/11 $’000
SEGMENT LIABILITIES Segment liabilities	6,416 4,505 446 714	6,862 5,219 6,026 6,079	12,888 11,298
Reconciliation of segment assets to the statement of financial position Tax Payables Borrowings Other Liabilities Total liabilities from continuing operations per the statement of financial position			3,507 4,410 7,500 - 400 514
			24,295 16,222

BUSINESS	TJM Products – Australia & USA TJM Products – China	TJM Products – Total Electrical Components Reconciliation to statement of cashflows Consolidated	TJM Products – Total Electrical Components Reconciliation to statement of cashflows Consolidated
	30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000	30/06/12 $’000	30/06/11 $’000 30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000 30/06/12 $’000 30/06/11 $’000
CASHFLOW INFORMATION Net cash flow from operating activities Net cash flow from investing activities Net cash flow from financing activities
	(2,343) 2,881 (46) 222	(2,389)	3,103 22,092 9,819 (10,142) (5,183) 9,561 7,739
	(1,843) (1,810) (59) (78)	(1,902)	(1,888) (341) (217) 970 1,661 (1,273) (444)
	82 (224) - 42	82	(182) (100) (66) (18,749) 6 (18,767) (242)

19

CMI Limited

Notes to the Financial Statements

For the Financial Year Ended 30 June 2012

10. Operating Segments (continued)

Products and Services within each Business Segment

For management purposes, the consolidated entity is organised into three major operating divisions – electrical components, 4WD components Australia & USA and 4WD components China. These divisions are the basis on which the consolidated entity reports its primary segment information. The above business segments derive revenue from the following products and services:

Continuing operations:

• TJM – the design, distribution and marketing of components and parts for 4WD, light commercial and heavy transport vehicles.

• Electrical Components – the manufacture of specialist cabling and electrical products for a range of industry sectors.

11. Reconciliation of Income Tax Expense

	Consolidated 2012	Consolidated 2011
	$’000	$’000
Profit/(Loss) Before Tax	11,571 18,807 3,471 5,642 (220) (24) 1 - (717) - 2,550 - 1,161 (131)
At 30%
Prior year under/overs
Foreign exchange adjustment
Research & Development Incentive
Impairment
Other
Tax Expense/(Benefit)	6,246 5,487

20

CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

12. Issued Capital

Class A Share Cancellation

On 12 June 2012, the share capital of the Company was reduced by the cancellation of all 28,005,311 Class A Shares on issue in consideration for the payment of $0.95 for each Class A Share cancelled.

The remaining Issued Capital of CMI Limited is 33,752,634 Fully Paid Ordinary Shares at 30 June 2012.

13. Other Financial Assets

Other Financial Assets
Other Receivables Loan receivable Provision for Impairment	2012 $’000 2011 $’000 17,000 17,000 (17,000) (8,500)
	- 8,500

Associated with the sale of the engineering business was a loan provided by CMI Limited to the purchaser to purchase the business with a $17 million face value. The loan bears interest on normal terms. The loan is secured by a second ranking fixed and floating charge over CMI Industrial Pty Ltd behind the National Australia Bank and a personal guarantee from M.J. Hofmeister of $2.5 million.

The loan was due to be repaid on 16 April 2011. Following an approach by CMI Industrial Pty Ltd it was agreed to extend the repayment date by 6 months. The loan was extended on the same terms and conditions.

The loan was not repaid on 16 October 2011. Interest had been paid on the loan in accordance with the security documents up until 16 October 2011 but interest payments due since have not been received.

On a regular basis the Board of CMI has assessed the recoverable value of the loan by assessing if there is any objective evidence of impairment as a result of one or more events that have occurred. On 24 June 2010 the Board determined that objective evidence of impairment in the loan balance existed (based on information provided by the borrower and other external sources) and again re-assessed the estimated future cash flows from this asset. As a result of this, the loan’s carrying value exceeded its recoverable value by $8 million and an impairment expense and provision for this amount was recorded.

The final discount repayment period expired on 15 April 2011. The carrying value increased to $17 million and the provision for impairment increased by $0.5 million.

On 28 February 2012 the Board determined that objective evidence of impairment in the loan balance existed (based on information provided by the borrower and other external sources) and again re-assessed the estimated future cash flows from this asset. As a result of this, the loan’s carrying value exceeded its recoverable value by $8.5 million and an impairment expense and provision for this amount was recorded at 31 December 2011. A further impairment of $0.8m had been recognised relating to the interest arrears and earlier adjustments due under the original sale agreements. No tax benefit was been recorded on the principal (capital) impairment of $8.5 million as sufficient forecasted capital profits are not envisaged to utilise these losses.

At 30 June 2012, principal and interest arrears, including default interest and charges, and earlier adjustments due under the original sale agreements total $19.1 million.

Administrators and Receivers were appointed to CMI Industrial Pty Ltd on 26 April 2012.

In forming the accounts at 30 June 2012 and subsequent to this date the Board’s assessment of the loan’s recoverable value has not changed with respect to this loan. The loan is carried at a nil value and classified as a non-current asset as the Board does not expect the loan to be repaid in the following 12 month period.

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CMI Limited

Notes to the Financial Statements For the Financial Year Ended 30 June 2012

14. Other Significant Information

Not Applicable

15. Information on Audit or Review

This preliminary final report is based on accounts to which one of the following applies.

 The accounts have been audited.  The accounts have been subject to review.

 The accounts are in the process of being  The accounts have not yet been audited or subject to review. audited or reviewed.

Description of likely dispute or qualification if the accounts have not yet been audited or subject to review or are in the process of being audited or subjected to review.

Not Applicable

Description of dispute or qualification if the accounts have been audited or subjected to review.

Not Applicable

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