| Fri 1 Aug 2008, 17:11 | | BEE - Beget Holdings Limited - Audited Annual Results For The 12 Months Ended 30 |
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BEE
BEE
BEE - Beget Holdings Limited - Audited Annual Results For The 12 Months Ended 30
April 2008
BEGET HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration number: 2002/011635/06
Share code: BEE & ISIN number: ZAE000044111
("Beget" or "the company")
AUDITED ANNUAL RESULTS FOR THE 12 MONTHS ENDED 30 APRIL 2008
BALANCE SHEET at 30 April 2008
Audited Audited
12 Months 12 Months
30-Apr-08 30-Apr-07
Assets R `000 R `000
Non-current assets 16,812 1,862
Property, plant and equipment 398 597
Deferred tax 4,508 0
Loans to shareholders 0 74
Intangible assets 11,906 1,191
Current assets 7,655 2,000
Inventory 1,407 1,026
Trade and other receivables 6,248 973
Cash and cash equivalents 0 1
Total assets 24,467 3,862
Equity and liabilities
Capital and reserves 3,340 -14,952
Issued capital 35,717 27,625
Distributable reserve -32,377 -42,577
Non-current liabilities 4,196 4,867
Shareholder loans 2,092 2,825
Finance lease obligation 174 235
Deferred tax 231 0
Deferred income 1,699 1,807
Current liabilities 16,931 13,947
Trade and other payables 10,753 7,909
Bank overdraft 713 734
Deferred income 1,311 928
Finance lease obligation 57 53
Other financial liabilities 3,890 3,576
Provisions 195 735
Taxation Current 12 12
Total equity and liabilities 24,467 3,862
Nett asset value per share 0.54 -2.94
(cents)
Nett tangible asset value per -1.39 -3.17
share (cents)
Number of ordinary shares in 762,882,492 556,958,811
issue
Weighted average shares issued 616,415,557 508,508,765
INCOME STATEMENT
for the 12 months ended 30 April 2008
Audited Audited
12 Months 12 Months
30-Apr-08 30-Apr-07
R `000 R `000
Gross revenue 23,442 13,277
Cost of sales -10,230 -5,881
Gross profit 13,212 7,396
Other income 2 0
Operational expenses -11,253 -13,698
Reversal of impairment 5,923 -11,352
Operational profit (loss) 7,884 -17,654
Investment revenue 9 5
Finance cost -1,970 -2,252
Profit (Loss) before taxation 5,923 -19,901
Taxation 4,277 0
Profit (Loss) for the period 10,200 -19,901
Weighted average shares in issue (`000) 616,416 508,508
Earnings per share (cents) 1.65 -3.91
Headline earnings per share (cents) 0.69 -1.68
RECONCILIATION BETWEEN EARNINGS AND HEADLINE EARNINGS
2008 2007
Earnings 10,200 -19,901
Less profit on sale of fixed assets -2 0
Plus impairment 0 11,352
Less Reversal of impairment -5,923 0
Headline earnings 4,275 -8,549
STATEMENT OF CHANGES IN EQUITY
for the 12 months ended 30 April 2008
Share Share Accumulated Total
capital premium loss
R R `000 R `000 R `000
Balance at 01 May 2006 964 24,343 -22,750 1,594
Loss for the year -19,901 -
19,901
Prior period adjustment 74 74
Issue of share capital 150 3,452 3,452
Share issue expenses -171 -171
Balance at 30 April 2007 1,114 27,624 -42,577 -
14,952
Balance at 01 May 2007 1,114 27,624 -42,577 -
14,952
Profit for the year 10,200 10,200
Issue of share capital 412 8,319 8,320
Share issue expenses -228 -228
Balance at 30 April 2008 1,526 35,715 -32,377 3,340
CASH FLOW STATEMENT
for the 12 months ended 30 April 2008
Audited Audited
12 Months 12 Months
30-APR-08 30-APR-07
R `000 R `000
Cash flows from operating activities 536 -980
Cash flows from investing activities -15 -302
Cash flows from financing activities -501 1,230
Decrease / increase in cash and cash equivalents 20 -52
Cash and cash equivalents at beginning of period -733 -681
Cash and cash equivalents at end of the period -713 -733
Condensed segmental reporting
Audited % Audited %
April February
2008 2007
R`000 R`000
Revenue
MobileBio 10,612 45 8,745 66
SMSolutions 5,630 24 4,532 34
Royalty fee income 7,200 31 0 0
Corporate 0 0 0 0
23,442 100 13,277 100
Inter group eliminations 0 -32
23,442 13,245
Operating profit (loss) before tax
MobileBio 2,786 -15,714
SMSolutions 1,331 745
Royalty fee income 6,800 0
Corporate -4,994 -4,964
5,923 -19,933
Inter group eliminations 0 32
Taxation 4,277
Profit (loss) after taxation 10,200 -19,901
ACCOUNTING POLICIES
The financial statements for the 12 months ended 30 April 2008 ("the period")
have been prepared in compliance with IFRS (International Financial Reporting
Standards) on Interim Financial reporting, specifically IAS34, the Listings
requirements of JSE Limited ("JSE") and the Companies Act 1971 (no 63 of 1971)
as amended. The accounting policies applied in the preparation of the annual
financial statements are consistent with those applied in the interim financial
statements for the period ended 31 January 2008. These annual financial
statements have been audited by PKF (PTA). The auditors report is available for
inspection at the registered office of the company.
GOING CONCERN
We draw attention to the fact that at 30 April 2008, the group had accumulated
losses of R (32,377,092), but the group`s total assets exceed its liabilities by
R 3,340,293. The group has also made a profit after taxation in the current year
of R10,200,327.
The annual financial statements have been prepared on the basis of accounting
policies applicable to a going concern. This basis presumes that funds will be
available to finance future operations and that the realization of assets and
settlement of liabilities, contingent obligations and commitments will occur in
the ordinary course of business.
The ability of the company to continue as a going concern is dependent on a
number of factors. The most significant of these is that the group reach their
profit forecast through the realization of profits budgeted for in the schools
project tender. The deal forms part of a Black Economic Empowerment transaction
entered into between the company and SMM Telematics (Pty) Ltd, which agreement
was concluded during the current financial year. Installation of products
detailed in the tender commenced during April 2008.
GROUP PROFILE
Beget is an IT and telecommunications group specializing in the development of
applications on the GPRS technology platform. The platform enables transmission
of data using cell phone networks at a fraction of the cost of fixed line and
radio telephony.
COMMENTARY ON RESULTS
With the rebuilding of systems and procedures firmly in place the outcome is
reflected in these results.
Turnover increased by 75% to R23,4 million (2007: R13,3 million) and the group
has made a profit of R10,2 million compared to a loss of R19,9 million in 2007.
All divisions are performing well and we are glad to report that our GPRS modem
division is also back on track.
Beget is a member of a consortium that was awarded a tender for the Gauteng On-
line e-learning project. The positive financial impact of this new division will
only reflect in the 2009 results and will have a substantial impact on the
company`s future income.
Of the 75% increase in turnover, R7,2 million was contributed by the BEE royalty
transaction that was concluded and the existing divisions showed a growth of 21%
year on year.
OPERATIONAL REVIEW
The group now has five divisions:
- Web based Biometrics with GPRS including:
- Access control
- Time & attendance control
- Payroll
- Web based SMS`s
- Bulk SMS`s
- MMS
- Web based LBS (Location Based Services)
- SMSOS
- Data base management with LBS
- GPRS Modems
- GSM modems for communication
- Telemetry in general
- School Tender Project
- Power supplies
- Web based alarm systems
- Biometric ID solutions
The attention given to recruit, train and motivate a retail sales force has
started to show results. The market for positive identification systems is
growing and more businesses are beginning to realise the need to have biometric
devices taking care of operations without human interface.
The group culture is one of commitment to achieving improved performance and
management and staff are motivated and focused on delivery and profitability.
The group`s focus is still mainly on web-based solutions. Utilizing GPRS as the
preferred communication platform, combined with web-based applications as a real
time solution, we can now deliver various solutions to our customers without
them having to invest in any additional hardware.
Set out below is a brief operational overview of the Beget divisions:
- MobileBIO is a biometric identity and access device utilizing wireless GPRS
technology. Despite the emergence of competing products Beget still enjoys
its first mover advantage. The division accounts for approximately 54% of
group revenue and is the flagship product of the company. With a receptive
South African market ready for positive identification systems, we are
currently concentrating on sales locally.
- SMSmalls is affordable bulk SMS messaging and this division, which
contributes approximately 24% of the group revenue, continues to grow at a
steady rate consistent with the industry.
- Location-Based Services (LBS) combines a suite of services and
infrastructure, all locally developed. Solutions include consumer,
commercial and emergency based products currently marketed to security
companies. Beget has commenced a trial traffic incident management
application which application is intended to yield a number of similar
business applications.
- Royalty income related to the use of our biometric intellectual property in
industries that are not in competition with our access control and time and
attendance systems, accounted for 30% of the group revenue. The biometric
technology is used in vehicle tracking and fleet management solutions to
identify drivers.
- The Schools project entails the supply of various components as well as the
maintenance and service of equipment supplied for 5 years. One thousand
schools in Gauteng are currently being equipped with computer laboratories.
Beget is responsible for the following equipment:
- AC/DC power supplies to power 25 scholar computers with DC power in
each school. This reduces the risk of using AC power at each computer
station.
- GPRS web-based alarm systems that will closely monitor the computer
laboratory, with control room software and incident management.
- Biometric authentication systems that allow scholars to access their
computer documents and emails only if positively identified.
CORPORATE ACTIONS
The BEE transaction was approved by shareholders on 19 January 2008. The
transaction can be summarized as follows:
- SMM Telematics (Proprietary) Limited paid R7,2 million in royalty fees to
Beget for 5,000 driver identification devices and any additional devices
ordered will be charged at R1,440 per device.
- Beget issued 196,000,000 shares to SMM Telematics (Proprietary) Ltd, a
black-owned company, of which the principal shareholder is Mr Tebogo
Mogashoa, at par value. This will result in SMM owning approximately 26% of
Beget`s total issued shares.
PROSPECTS
With these positive results and the implementation of the school project we
believe that Beget is well positioned for solid growth.
The board is confident of achieving profits in 2009.
POST BALANCE SHEET EVENTS
There are no post balance sheet events to report.
CHANGES TO THE BOARD OF DIRECTORS
T Mogashoa was appointed as acting chairman 1 June 2007.
J Coetzee resigned from the board on 27 September 2007.
D Hawkins was appointed as Sales director on 27 September 2007.
H Potgieter was appointed as Technical director on 27 September 2007.
DECLARATION OF DIVIDEND
In line with the group policy no dividend has been declared for the period.
On behalf of the Board
1 August 2008
AH Potgieter - CEO
Directors: T Mogashoa*(Chairman); AH Potgieter (CEO); CJ van Coller*, D Hawkins.
H Potgieter (*non-executive)
Registered office: 85 Durham Street, Clubview, Centurion (PO Box 13983,
Clubview, 0014)
Transfer secretaries: Link Market Services South Africa (Proprietary) Limited,
11 Diagonal Street, Johannesburg, 2001 (PO Box 4844, Johannesburg, 2000)
Company secretary: Ester Calitz, 2 Gonubi Street, Doornpoort, PO Box 13983,
Clubview, 0014
Auditors
PKF (Pretoria) Incorporated
Sponsor
Merchant Sponsors (Proprietary) Limited
Date: 01/08/2008 17:11:01 Produced by the JSE SENS Department.
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