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SVB
SVB
SVB - SilverBridge - Unaudited Group Results For The Six Months Ended
31 August 2007
SilverBridge Holdings Limited
(formerly Synergy Holdings Limited)
Incorporated in the Republic of South Africa
(Registration number: 1995/006315/06)
JSE Share code: "SVB" ISIN Code: ZAE000086229
("SilverBridge" or "the Group")
UNAUDITED GROUP RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2007
SDT** Previously
reported
Unaudited Audited Unaudited Unaudited
6 months 12 months 6 months 6 months
ended ended ended ended
31 August 28 February 31 August 31 August
2007 2007 2006 2006
R`000 R`000 R`000 R`000
Revenue
25,049 51,079 21,826 -
Other income
342 1,013 273 81
Other expenses
(22,307) (41,005) (20,265) (560)
Finance income
454 582 114 31
Finance expense
(29) (11) - -
Profit/(loss)
before taxation 3,509 11,658 1,948 (448)
Taxation
(1,022) (3,462) (694) -
Profit/(loss)
for the year 2,487 8,196 1,254 (448)
Attributable to:
Equity holders (448)
of the parent 2,487 8,177 1,235
Minority
interests - 19 19 -
2,487 8,196 1,254 (448)
Number of shares
in issue (`000) 32,597 32,597 52,473 52,473
Weighted average
number of shares 32,597 26,936 52,473 52,473
in issue (`000)
Earnings and
diluted earnings 7.63 30.36 2.35 (0.85)
per share
(cents)*
Headline and
diluted headline 7.63 30.55 2.45 (0.85)
earnings per
share (cents)*
* There are no
dilutive
instruments in
issue by the
company.
Reconciliation
of headline
earnings
Basic and
diluted earnings 2,487 8,177 1,235 (448)
Adjusted for:
Loss on sale of 52
partial interest - 52 -
in subsidiary
Headline and
diluted headline 2,487 8,229 1,287 (448)
earnings
Headline
earnings per 7.63 30.55 2.45 (0.85)
share (cents)
Condensed Unaudited Group Balance Sheet as at 31 August 2007
SDT** Previously
reported
Unaudited Audited Unaudited Unaudited
6 months 12 months 6 months 6 months
ended ended ended ended
31 August 28 February 31 August 31 August
2007 2007 2006 2006
R`000 R`000 R`000 R`000
ASSETS
Non Current
Assets
Equipment
2,104 1,703 1,354 -
Intangible -
assets 10,992 11,191 2,970
Investment in
associate 72 71 26 -
Deferred tax -
assets 1,656 1,429 328
Total non-
current assets 14,824 14,394 4,678 -
Current Assets
Income tax
receivable 1,350 250 - -
Revenue
recognised not 2,378 2,066 - 564
yet invoiced
Amounts owing - - 76 -
to related
parties
Trade and
other 13,552 13,056 8,585 132
receivables
Cash and cash
equivalents 7,874 16,398 13,645 3,812
Total current
assets 25,154 31,770 22,306 4,508
Total Assets
39,978 46,164 26,984 4,508
EQUITY AND
LIABILITIES
Capital and
Reserves
Issued capital
326 326 1 16,923
Share premium - -
10,804 14,872
Treasury - -
shares (206) (78)
Retained
earnings/(accu 14,722 12,235 5,293 (13,236)
mulated loss)
Total equity
attributable 25,646 27,355 5,294 3,687
to equity
holders of the
parent
Minority -
interests - - -
Total equity
attributable 25,646 27,355 5,294 3,687
to equity
holders of the
parent
Non-Current
Liabilities
Deferred tax - -
- 119
Total non-
current - - - 119
liabilities
Current
Liabilities
Deferred -
revenue 3,188 5,514 7,223
Trade and
other payables 5,086 8,502 5,000 702
Shareholders - - 3,957 -
for dividends
Income tax
payable - - 2,150 -
STC payable
- - 114 -
Provisions -
6,058 4,793 3,246
Total current
liabilities 14,332 18,809 21,690 702
Total Equity
and 39,978 46,164 26,984 4,508
Liabilities
Condensed Unaudited Group Cash Flow Statement for the 6 month
period ended 31 August 2007
SDT** Previously
reported
Unaudited Audited Unaudited Unaudited
6 months 12 months 6 months 6 months
ended ended ended ended
31 August 28 February 31 August 31 August
2007 2007 2006 2006
R`000 R`000 R`000 R`000
Net cash from (3,135) 7,603
operating 3,003 (661)
activities
Net cash from (1,190) (1,006)
investing 1,735 2,103
activities
Net cash from (4,199) -
financing 4,623 -
activities
Net increase/ (8,524) 6,597
(decrease) in 9,361 1,442
cash
Cash at the 16,398 7,048
beginning of the 7,048 2,370
year
Effects of - - -
exchange (11)
translation on
cash and cash
equivalents
Cash at the end
of the year 7,874 16,398 13,645 3,812
Condensed Unaudited Group Statement of Changes in Equity for the
year ended 31 August 2007
SDT** Previously
reported
Unaudited Audited Unaudited Unaudited
6 months 12 months 6 months 6 months
ended ended ended ended
31 August 28 31 August 31 August
2007 February 2006 2006
2007
R`000 R`000 R`000 R`000
Opening balance
27,355 4,066 4,066 4,135
Profit/(loss) for the
year attributable to 2,487 8,177 1,235 (448)
equity holders of the
parent
Minority interests -
- 19 19
Total recognised 2,487 8,196 1,254 (448)
income and expense
for the year
Minority interest -
removal on sale of - (26) (26)
partial interest in
subsidiary
Deemed cost of - -
reverse acquisition - 10,496
Allotment of 2350 000 - -
shares - 4,701
Treasury shares - -
acquired (128) (78)
Capital distribution - -
of share premium (4,068) -
Closing Balance
25,646 27,355 5,294 3,687
Condensed Unaudited segment reports for the 6 month period 31 August
2007
Primary: Business segment report
Total Software
Implemen Suppor Research rental
tation t &
& other
services servic developm
es ent
R`000 R`000 R`000 R`000 R`000
31 August 2007
Segment revenue 10,784 5,696 - 8,569
25,049
Segment result 2,187 2,416 (4,275) 8,569
8,897
Unallocated
expenses, finance (6,410)
income and
expense, share of
associate and
income tax
expense
Profit for the
period 2,487
28 February 2007
Segment revenue
51,079 30,100 9,358 - 11,621
Segment result
33,000 21,659 3,629 (5,185) 12,897
Unallocated
expenses, Finance (24,804)
income and
expense, share of
associate and
income tax
expense
Profit for the
period 8,196
31 August 2006 **
Segment revenue 11,052 4,308 - 6,466
21,826
Segment result 6,241 2,549 (2,877) 6,466
12,379
Unallocated
expenses, Finance (11,125)
income and
expense, share of
associate and
income tax
expense
Profit for the
period 1,254
* The assets & liabilities of the Group are organised and managed at a
corporate business support level. As the assets and liabilities contribute at a
corporate level, it is not practicable to determine a reasonable allocation of
assets and liabilities to the business segments.
Secondary: Geographical segment
Total South Other
Africa Zimbabwe African
countries
*
R`000 R`000 R000 R`000
31 August 2007
Revenue from external 25,049 15,458 847 8,744
clients
Assets and liabilities
Segment assets 39,978 33,613 1,977 4,388
Segment liabilities 14,322 14,322 - -
28 February 2007
Revenue from external 51,079 28,123 2,331 20,625
clients
Assets and liabilities
Segment assets 46,164
39,209 1,165 5,790
Segment liabilities 18,809
18,809 - -
31 August 2006**
Revenue from external 21,826 10,522 1,365 9,939
clients
Assets and liabilities
Segment assets 26,984 20,782 2,583 3,619
Segment liabilities 21,690 21,690 - -
* Other African countries include Kenya, Malawi, Nigeria, Ghana, Namibia,
Lesotho and Swaziland.
** The reported 31 August 2006 comparative information represents a
continuation of the Group condensed interim financial statements of SDT
Financial Software Solutions (Pty) Ltd ("SDT"), as SDT is the effective holding
company of SilverBridge, by virtue of the requirements of IFRS 3: Business
Combinations, Annexure B: Reverse Acquisitions. For further detail to the
accounting treatment compared to the legal form of this acquisition, see 1.2
Comparative information.
COMMENTARY
1. ACCOUNTING POLICIES
1.1 Basis of presentation
The interim financial statements have been prepared in accordance with IAS 34:
Interim financial reporting, and in compliance with the listing requirements of
the JSE Limited. The financial statements are presented in rand rounded to the
nearest thousand (R`000). They are prepared on the historical cost basis.
The interim financial statements for the 6 month period ended 31 August 2007
incorporate the condensed unaudited Group financial statements and are prepared
in accordance with the Group`s accounting policies which are in accordance with
International Financial Reporting Standards (IFRS). The accounting policies
applied are consistent with those of the previous financial year.
1.2 Comparative information
On 6 November 2006, SilverBridge acquired 100% of the equity of SDT from the
then shareholders of SDT (SDT Vendors). The acquisition was settled through the
issue of 25 000 000 SilverBridge shares at R2 per share. As a result of the
transaction, the SDT vendors acquired effective control (82,65%) over
SilverBridge and it constituted a reverse acquisition in terms of IFRS 3:
Business combinations.
A reverse acquisition occurs when a legal subsidiary obtains effective control
over a legal holding company. In such situations the Group financial statements
reflect the continuation of activities of the legal subsidiary in accordance
with IFRS 3: Business Combinations.
Accordingly, the Group results for the 6 month period ending 31 August 2007,
and for the year ending 28 February 2007, and the related comparatives, as
presented, represent a continuation of the SDT Group (representing SDT, its
subsidiaries, and its interest in the associate) into which SilverBridge is
consolidated as a subsidiary as from 6 November 2006.
As the reverse acquisition occurred after the publication of the interim
results for the 6 month period ended 31 August 2006, these comparative
published results, referred to as the "Previously reported unaudited 31 August
2006" results, do not represent a fair comparison on the financial state of the
Group. Accordingly these results should not be used to analyse the Group.
All comparative analysis of the results and performance of the Group, reflected
herein, should accordingly be derived from the results referred to as "SDT
Unaudited 6 months ended 31 August 2006".
1.3 Related party transactions
Group transactions with related parties are in the ordinary course of its
business. These transactions are no less favourable than those arranged with
third parties.
2. CORPORATE ACTIVITY
During the 6 month period under review the following corporate activity was
effected.
2.1 Capital distribution
A capital distribution of 12.5 cents per ordinary share was approved on 28 May
2007, at the AGM, by the shareholders. The capital distribution was paid to
shareholders on 2 July 2007.
2.2 The BEE transaction
During the period, Kagiso Trust Investments (Pty) Ltd and Metropolitan Holdings
Ltd, acting through a special purpose vehicle acquired a 20% interest in
SilverBridge from certain of its shareholders. It is anticipated that the BEE
transaction will not only assist in enhancing SilverBridge`s growth prospects
but will also make a positive contribution to SilverBridge in terms of its
transformation initiatives, relationships and business development
opportunities. The SENS announcement dated 7 May 2007 can be viewed for further
detail to the transaction.
3. DIRECTORATE
Andile Sangqu, executive director of KTI, and Justin van den Hoven, executive
director of Metropolitan International, were appointed to the board of
SilverBridge. Andile Sangqu was appointed as non-executive Chairman of
SilverBridge and Justin van den Hooven as a non-executive director of
SilverBridge. David Smollan, the previous Chairman, remains on the board as a
non-executive director. These board changes were effective from 7 May 2007..
There have been no other changes to the board of directors.
4. FINANCIAL RESULTS AND PERFORMANCE
4.1 RESULTS AND PERFORMANCE
The Group`s results for the 6 month period ended 31 August 2007 exceeded the
comparative 6 month period ended 31 August 2006 continued results of SDT. In
particular:
- Profit for the period of R 2.5 million exceeded the previous comparative 6
month period of R 1.2 million. Revenues over the period increased from
R21.8 million to R25 million. In the first 6 month period of the financial
year the results were negatively impacted by delays in the commencement of
certain material projects. As a result, the Group carried overheads
associated with these projects without the requisite revenues. Subsequent
to the 6 month period ended 31 August 2007, the projects have successfully
commenced and, as was the case in the previous year the second six months
are expected to contribute a disproportionate amount to the full year
profit.
- The Group is maintaining fiscal discipline by streamlining operational
costs.
- Earnings per share and headline earnings per share have increased to 7.63
cents per share compared to the comparative earnings per share of 2.35
cents and headline earnings per share of 2.45 cents per share
respectively. This is mainly attributable to the change in the weighted
average number of shares utilised of 32.6 million shares in comparison to
the previous 52.4 million shares. The change in the weighted average
number of shares is due to the restructuring of the share capital by:
- Consolidating the ordinary shares in a ratio of 10 for 1;
- Issuing 25 000 000 shares to the SDT vendors and 2 350 000 shares to
the public as part of the transaction to acquire SDT.
- the increase in earnings and headline earnings from R1.2 million to R
2.5 million.
- The Group`s financial position remains strong. Cash was utilised for:
- the capital distribution of R 4 million; and
- the investment of R 1 million in new equipment to enhance operational
efficiencies.
4.2 GROUP OUTLOOK
The outlook for the second half of the financial year is positive following the
commencement of certain material projects. As indicated earlier, it is expected
that these contracts will make a significant contribution to the overall
performance of the group for the current financial year.
In the medium term, the structural adjustments in the local financial services
industry continue to create a sound market for the Group in South Africa. The
market for software in financial services is growing and we foresee a
significant increase in the demand for quality niche software applications. The
economic development in Africa and resultant evolution of financial services
presents an exciting opportunity for well positioned solution providers, and
the Group expects continued growth on the Continent. The Group is constantly
seeking out reputable companies for acquisition and incorporation into the
Group, in order to expand and grow the SilverBridge footprint.
5. CORPORATE GOVERNANCE
The Board is committed to the promotion of good corporate governance as set out
in the King II report on Corporate Governance in South Africa. The board of
directors recognises the need for adherence to the report and is continuing to
implement procedures in order to ensure that the Group has an effective
corporate governance policy.
On behalf of the board of directors
Jaco Swanepoel Andile Sangqu
Chief Executive Officer Chairman
Pretoria
16 October 2007
CORPORATE INFORMATION
Transfer Secretaries Auditors
Computershare Investor KPMG Incorporated
Services 2004 (Pty) Ltd (Registration number:
(Registration number: 4530188665)
2004/003647/07)
70 Marshall Street Corporate Advisers
Johannesburg, 2001 i capital advisers (Pty) Ltd
(PO Box 61051, (Registration number:
Marshaltown,2107) 1998/018685/07)
Company Secretary Designated Advisers
Fusion Corporation (Pty) Ltd, Sasfin Capital
represented by Melinda van der (a division of Sasfin Bank
Berg Limited)
Previously Sylvan CSI, (Registration number:
represented by Melinda van 1951/002280/06)
der Berg
Directors of SilverBridge:
Jaco Swanepoel, Freda du Toit, Jaco Maritz, *David Smollan, *Rowan
Williams,*Andile Sangqu, *Justin van den Hoven
(All the directors are South African citizens).* Non-executive
Date: 16/10/2007 17:17:38 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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