| Fri 8 Feb 2008, 10:13 | | TLM - TeleMasters Holdings Limited - Interim results for the 1st Quarter ended |
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TLM
TLM
TLM - TeleMasters Holdings Limited - Interim results for the 1st Quarter ended
31 December 2007
TeleMasters Holdings Limited
(Incorporated in the Republic of South Africa)/ Registration number
2006/015734/06)
Share code: TLM & ISIN Number: ZAE000093324
("Telemasters" or "the Company")
Interim results for the 1st Quarter ended 31 December 2007
COMMENTARY
FINANCIAL RESULTS
INCOME STATEMENT
Un-audited Un-Audited
3 months ended 31 3 months ended 31
December2006 December 2006
Revenue 41,257,911 35,431,950
Cost of sales (35,975,910) (30,049,108)
Gross profit 5,282,001 4,982,842
Investment income 369,194 44,142
Gross income 5,651,195 5,026,984
Finance costs (49,910) (332)
Operating expenses (3,207,551) (2,944,944)
Profit before taxation 2,393,734 2,081,708
Taxation (1,141,317) (603,695)
Net profit for the period 1,252,417 1,478,013
Number of shares in issue 42,000 39,060
(`000)
Weighted average number of 42,000 39,060
shares (`000)
Headline earnings per share 2.98 3.78
(cents)
Earnings per share (cents) 2.98 3.78
Diluted earnings per share 2.98 3.78
(cents)
BALANCE SHEET
Un-Audited at 31 Un-Audited at 31
December 2007 December 2006
ASSETS
Non-current assets 8,345,510 6,272,674
Intangible assets 275,791 23,778
Property, plant and 8,069,700 6,248,896
equipment
Other financial assets 19 -
Current assets 29,146,174 11,713,622
Trade and other receivables 10,040,331 11,475,559
Cash and cash equivalents 19,105,843 238,063
Total assets 37,491,684 17,986,296
EQUITY AND LIABILITIES
Total equity 12,734,001 5,978,475
Share capital 4,200 3,906
Share premium 5,503,859 4,496,556
Retained earnings 7,225,942 1,478,013
Non-current liabilities 906,174 -
Installment sale agreements 824,887 -
Deferred tax
81,287 -
Current liabilities 23,851,509 12,007,821
Installment sale obligations 516,240 -
Bank overdraft 19,045 -
Dividend payable 80,799 -
Current tax payable 5,011,512 603,695
Trade and other payables 18,223,913 11,404,126
Total equity and liabilities 37,491,684 17,986,296
Net asset value per share 30,32 15.30
(cents)
Net tangible asset value per 29,66 15.27
share (cents)
CASH FLOW STATEMENT
Cash flows from operations 5,684,699 2,277,027
Finance cost (49,910) (332)
Taxation paid (489,934) -
Investment income 369,194 44,142
Net Cash flows from 5,514,049 2,320,837
operating activities
Expenditure to expand
operating activities
Property, plant and (1,400,857) (6,795,362)
equipment acquired
Intangible assets acquired (-) (25,937)
Net cash from investing (1,400,857) (6,821,299)
activities
Proceeds on share issues - 4,500,462
Dividends paid (4,959,201) -
Repayment of installment (148,118) -
sale obligations
Installment sale agreements 750,000 -
Net cash from financing (4,357,319) 4,500,462
activities
Total cash movement for the (244,127) 238,063
period
Cash at beginning of period 19,330,925 -
Total cash at end of the 19,086,798 238,063
period
STATEMENT OF CHANGES IN SHAREHOLDERS` EQUITY
Balance 23 May 2006 on 5,970,462
incorporation- Share capital and
premium issued
Share issue and listing costs (462,403)
applied against share premium
Net profit for the year ended 30 11,013,525
September 2007
Balance at 30 September 2007 16,521,584
Dividends paid 30 November 2007 (5,040,000)
Net profit for the 1st quarter 1,252,417
ended 31 December 2007
Balance at 31 December 2007 12,734,001
1. FINANCIAL RESULTS
1.1 Statement of compliance and basis of preparation
The interim financial statements for the three months ended 31 December 2007
have been prepared in accordance with accounting policies and methods of
computation which are consistent with International Financial Reporting
Standards. These results have not been audited or reviewed by the Company`s
auditors. This announcement is prepared in accordance with IAS 34 - Interim
Financial Reporting.
1.2 Commentary
The results reflect an increase in the Revenue of the company of 16,4% over the
comparative previous period. Net profits before tax is 15% up on the comparative
period despite the full year`s expenses relating to audit fees for the prior
period and STC on the dividend declaration being included in the current period.
Various other operating and administrative support expenses put in place to
monitor a public company were not incurred in the comparative period on account
of the company not being listed during that period.
The company`s first quarter turnover traditionally reflects the slower Customer
usage of the Company`s service in the run up to during the holiday period.
Due to the payment of a dividend, STC amounting to R496,895 is included in
taxation in the income statement and has the effect of reducing the earnings by
1,27 cents per share, which is not attributable to the trading results of the
company and is not comparable with the comparative period. Despite the dividend
paid all ratios have improved with a substantial increase of the liquidity
ratios.
1.3. Dividends
A dividend of 12 cents per share has been declared and paid to all shareholders
registered on 30 November 2007 reflecting a 44,5% payout of earnings,
positioning the Company with the largest dividend yield on the Alt-X by a
substantial margin. A large portion of the cash balances were retained to assist
with future anticipated acquisitions.
2. LITIGATION
There are currently no legal or arbitration proceedings against the Company and
the Company has no subsidiaries (including any proceedings which are pending or
threatened) of which the Company is aware which may have, or have had in the 12
months preceding the date of this report, a material effect on the position of
the Company.
3. SUBSEQUENT EVENTS
The company has engaged in discussions with various parties with a view to
acquire comparative and complimentary business operations into TeleMasters. As
at date hereof no final agreements have been negotiated and the Company expects
to make certain announcements in the near future.
4. SHARE CAPITAL
No changes to the issued Share Capital have taken place since the last financial
year.
5. OPERATIONAL REVIEW AND OUTLOOK
The Company continues to concentrate primarily on organic growth with various
acquisition opportunities being negotiated. Organic revenue growth is
anticipated to be in the region of 20% over the course of the year.
Revenue may be affected by the anticipated lowering of regulated Interconnection
Charges between cellular networks and fixed line operators. TeleMasters business
model is structured to overcome sharp reductions in prices as the knock on
effect will be only be approximately 1% for every 10% change in the final price.
Such revenue decreases will be offset by new Revenue enhancement programs which
will process of being implemented from Q2.
Costs continue to be closely monitored and no major increases in any area are
expected.
TeleMasters still enjoys 100% annuity income and organic growth and all new
clients canvassed contribute to the enhancement of the Revenue streams with
little additional costs necessary to provide traditionally excellent service.
The positive cash flow of TeleMasters will continue to be sound with an
anticipated Dividend policy of in excess of 40%.
For and on behalf of the Board:
ME Moji MB Pretorius
Non-executive Chairman Chief Executive Officer
8 February 2008
Designated Advisor: River Group
Directors: ME Moji*, MB Pretorius, BR Topham, IG Bekker (* non-executive)
Company secretary: BR Topham
Registered address: Equity Estate Building 2, Masters House, Charles de Gaulle
Crescent, Highveld Park Ext 9, Centurion, (P.O Box 2887, Montana Park, 0159)
Transfer secretaries: Computershare Investor Services 2004 Limited, 70 Marshall
Street, Johannesburg, 2001 (PO Box 61051, Marshalltown,2107)
Website: www.telemasters.co.za
Date: 08/02/2008 10:13:46 Produced by the JSE SENS Department.
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