| Thu 27 May 2010, 9:00 | | DTH - DTH - Provisional audited results for the twelve months ended 28 February |
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DTH
DTH
DTH - DTH - Provisional audited results for the twelve months ended 28 February
2010
DTH DYNAMIC TECHNOLOGY HOLDINGS LIMITED
(Formerly Dynamic Visual Technologies Holdings Limited)
(Registration number 2004/016984/06)
Share Code: DTH
ISIN: ZAE000124681
("DTH" or "the group")
www.DTH.co.za
PROVISIONAL AUDITED RESULTS FOR THE TWELVE MONTHS ENDED 28 FEBRUARY 2010
HIGHLIGHTS
- Revenue from continuing operations increased by 19,6% to R84,9 million
- Attributable earnings decreased by 21,2% to R6,9 million
- Headline earnings per share decreased by 29,7% to 12,3 cents per share
- Total assets were relatively unchanged at R43,1 million
- Tangible net asset value per share increased by 23,9% to 56,0 cents
- Cash increased to R21,0 million
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 28 FEBRUARY
2010 2009
Continuing operations
Revenue 84 944 153 71 031 589
Cost of sales (268 471) (631 769)
Gross profit 84 675 682 70 399 820
Other income 1 839 807 54 905
Operating expenses (76 833 616) (60 577 161)
Operating profit 9 681 873 9 877 564
Investment revenue 929 184 1 218 438
Finance costs (9 380) (54 776)
Profit before taxation 10 601 677 11 041 226
Taxation (3 110 888) (3 021 406)
Profit from continuing operations 7 490 789 8 019 820
Discontinued operations
(Loss) / profit for the year from discontinued
operations (562 177) 859 556
Profit for the year 6 928 612 8 879 376
Other comprehensive income - -
Total comprehensive income 6 928 612 8 879 376
Total comprehensive income attributable to:
Equity holders of the parent 6 882 936 8 734 134
Non-controlling interest 45 676 145 242
Weighted number of shares in issue 47 839 899 49 948 231
Fully diluted weighted number of shares in issue 47 839 899 49 948 231
Earnings per share (cents)
- Basic 14.4 17.5
- Headline 12.3 17.5
- Diluted 14.4 17.5
- Diluted headline 12.3 17.5
Dividend per share 0.0 3.0
The earnings used in the calculation of headline earnings per share reconciles
to the earnings used in the calculation of basic earnings per share as follows:
Profit attributable to the equity 6 882 936 8 734 134
holders of the parent
Earnings used in the calculation of basic EPS 6 882 936 8 734 134
less: Profit on disposal of equipment - (13 515)
less: Profit on disposal of investment in (986 395) -
subsidiary
Headline earnings 5 896 541 8 720 619
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 28 February 2010 2009
ASSETS
Non-Current Assets 10 875 652 12 415 098
Property, plant and equipment 1 333 406 1 358 588
Goodwill 9 147 440 10 233 429
Intangible assets 109 439 526 257
Deferred tax 285 367 296 824
Current Assets 32 181 690 30 599 897
Trade and other receivables 11 163 818 16 848 297
Cash and cash equivalents 21 017 872 13 751 600
Total Assets 43 057 342 43 014 995
EQUITY AND LIABILITIES
Capital and reserves 37 545 454 33 658 240
Share capital 11 841 288 13 182 384
Reserves 240 398 167 682
Retained income 25 463 768 19 924 677
Non-controlling interest - 383 497
Current liabilities 5 511 888 9 356 755
Current tax payable 373 525 1 827 134
Operating lease liability 100 200 83 096
Trade and other payables 5 011 841 6 959 649
Deferred income - 486 876
Bank overdraft 26 322 -
Total Equity and Liabilities 43 057 342 43 014 995
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 28 February
Share
Total Based
Share Share Share Payment
Capital Premium Capital Reserve
Balance at 1 March 2008 236 878 13 758 222 13 995 100 71 836
Changes in equity
Total comprehensive income for the year
Shares held by Share (1 878) (298 356) (300 234) -
Incentive Trust
Treasury shares held by (3 106) (509 376) (512 482) -
Subsidiary - DVT Gauteng (Pty) Ltd
Share based payment - - - 95 846
Balance at 1 March 2009 231 894 12 950 490 13 182 384 167 682
Changes in equity
Total comprehensive income for the year
Treasury shares held by (8 260) (1 332 836) (1 341 096) -
Subsidiary - DVT Gauteng (Pty) Ltd
Share based payment - - - 72 716
Net dividends - - - -
Derecognising of non-controlling - - - -
Interest
Balance at 28 February 2010 223 634 11 617 654 11 841 288 240 398
Total
attributable
to equity Non
Retained holders of controlling Total
income the Group interest equity
Balance at 1 March 2008 11 190 543 25 257 479 238 255 25 495 734
Changes in equity
Total comprehensive income for
the year 8 734 134 8 734 134 145 242 8 879 376
Shares held by share - (300 234) - (300 234)
Incentive Trust
Treasury shares held by - (512 482) - (512 482)
Subsidiary - DVT Gauteng (Pty) Ltd
Share based payment 95 846 - 95 846
Balance at 1 March 2009 19 924 677 33 274 743 383 497 33 658 240
Total comprehensive income
For the year 6 882 936 6 882 936 45 676 6 982 612
Treasury shares held by (1 341 096) - (1 341 096)
Subsidiary - DVT Gauteng (Pty) Ltd
Share based payment - 72 716 - 72 716
Net dividends (1 343 845) (1 343 845) - (1 343 845)
Derecognising of non-controlling - - (429 173) (429 173)
interest
Balance at 28 February 2010 25 463 768 37 545 454 - 37 545 454
CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 28 February
2010 2009
Cash generated from operations 11 420 765 5 480 544
Interest income 945 554 1 249 907
Finance costs (9 398) (57 439)
Tax paid (4 432 779) (2 717 435)
Cash flows from discontinued operations (548 412) 708 650
Dividends paid (1 343 845) -
Net cash from operating activities 6 031 885 4 664 227
Net cash from investing activities 1 216 325 (2 725 327)
Purchase of property, plant and equipment (602 176) (926 594)
Proceeds on sale of property, plant and equipment - 30 437
Purchase of other intangible assets - continued (118 092) (37 005)
operations
Purchase of other intangible assets - discontinued (215 978) (481 253)
Operations
Acquisition of businesses - (503 180)
Sale of businesses 3 485 408 -
Acquisition of shares in holding company (1 332 837) (807 732)
Net cash from financing activities (8 260) (4 984)
Share capital elimination (8 260) (4 984)
Total cash movement for the year 7 239 950 1 933 916
Cash at the beginning of the year 13 751 600 11 817 684
Total cash at end of the year 20 991 550 13 751 600
SEGMENTAL ANALYSIS
for the twelve months ended 28 February
Central
2010 Product Services Operations
Continuing operations
Turnover 8 747 112 76 197 041 -
EBITDA 708 888 8 585 136 974 557
Depreciation and amortization (9 460) (573 395) (3 853)
Net interest - 14 989 904 815
Profit before tax 699 428 8 026 730 1 875 519
Tax (235 986) (2 243 534) (631 368)
Profit after tax 463 442 5 783 196 1 244 151
Contribution 6.2% 77.2% 16.6%
Discontinued operations
Turnover 4 588 664 167 951 -
EBITDA 295 586 (923 493) -
Depreciation and amortization (279 194) - -
Net interest 16 352 - -
Profit before tax 32 744 (923 493) -
Tax 69 994 258 578 -
(Loss) / Profit after tax 102 738 (664 915) -
Contribution 18.3% -118.3% 0.0%
Central
2009 Product Services Operations
Continuing operations
Turnover 1 628 460 69 403 129 -
EBITDA 250 764 9 873 017 218 965
Depreciation and amortization (25 533) (435 796) (3 853)
Net interest - 3 581 1 160 082
Profit before tax 225 230 9 440 802 1 375 194
Tax 223 596 (2 864 382) (380 620)
Profit after tax 448 826 6 576 420 994 574
Contribution 15.3% 73.5% 11.2%
Discontinued operations
Turnover 7 875 307 2 874 440 -
EBITDA 802 299 280 928 -
Depreciation and amortization (265 380) - -
Net interest 28 808 (1) -
Profit before tax 565 727 280 927 -
Tax 61 562 (48 660) -
Profit after tax 627 289 232 267 -
Contribution 73.0% 27.0% 0.0%
Major Customers 2010 2009
Customer 1 13 267 983 10 641 480
Customer 2 9 020 557 10 022 942
Customer 3 7 695 384 9 848 872
Customer 4 6 760 876 7 752 484
OVERVIEW
Nature of Business
DTH is a group of businesses specialising in application software. Our core
focus is providing tailor-made solutions to fit the specific needs of our
clients. We typically use a blend of existing and custom built software and
components. Through our operating businesses, we offer solutions based on both
Microsoft .Net(TM) and Java(TM) development platforms and also provide
specialist skills and professional services across the entire software
development lifecycle.
The group has two operating businesses as follows:
DVT - custom software development and related services
Emerald Consulting - legal industry software solutions
Basis of Preparation
The audited results for the 12 months ended 28 February 2010 have been prepared
in accordance with International Financial Reporting Standards, IAS 34 (Interim
Financial Reporting), the Listings Requirements of the JSE Limited and the
Companies Act of South Africa. The accounting policies used are consistent with
those used in the preparation of the annual financial statements for the year
ended 28 February 2009.
The results for the 12 months ended 28 February 2010 have been audited by the
group`s auditors, Greenwoods Chartered Accountants, and their unqualified audit
opinion is available for inspection at the group`s registered office.
Financial Overview
- Revenue from continuing operations for the period increased by 19,6% to R84,9
million due to organic growth.
- Operating margins from continuing operations decreased to 11,4% (2009: 13,9%),
despite having achieved reasonable growth in revenues. Market conditions
continue to be as such whereby downward pressure is being maintained on billable
rates, and upward pressure to costs as a result of the acute skills shortage in
the industry.
Discontinued operations
During the year under review, the Group disposed of its interests in Offline
Digital (Pty) Ltd, and the business of Radical (a division within its subsidiary
Dynamic Visual Technologies (Gauteng) (Pty) Ltd). Both businesses formed part of
the product segment of the group, and were marginal in terms of contribution to
group profit, and remained too small and specialised to be considered core to
the business of DTH. Their disposals have enabled management to focus their
attention on the group`s core activity, being software development and services.
The services business of The Talent Exchange (a division within its subsidiary
Dynamic Visual Technologies (Gauteng) (Pty) Ltd) was discontinued to curtail
further losses. The demand for IT recruitment services was severely affected by
the downturn in the economy and the recovery of this business activity could not
be foreseen in the short to medium term.
Dividend
No dividend was declared during the year under review (2009: 3.0 cents per
share).
- The group achieved basic attributable earnings of R6,9 million. This
represents a year on year decline of 21,2%.
- Headline earnings were 12,3 cents per share, down 29,7% from the prior year.
- Total assets in the Group remained relatively unchanged at R43,1 million.
On a per share basis Net Asset Value is 75,1 cents (2009: 67,3 cents) and
Tangible Net Asset Value is 56,0 cents (2009: 45,2 cents) based on 50 000 000
shares in issue (2009: 50 000 000 shares).
Governance
The group recognises the need to conduct its business with integrity,
transparency and equal opportunity and subscribes to the spirit of good
corporate governance as set out in the King Report.
Board of Directors
Mr D Hughes assumed the role of Non-Executive Director with effect from 1 March
2010 (and continues to act as the Company Secretary to the group). Mr R Fehrsen
was appointed as an Independent Non Executive Director on 30 March 2009.
Subsequent Events
No events material to the understanding of the report have occurred in the
period between the period-end date and the date of this report.
Annual Report
The company`s 2010 annual report, including a notice of the annual general
meeting will be posted to shareholders in due course. A further SENS
announcement providing salient information relating to the posting of the Annual
report and notice of Annual General Meeting will be published.
For and on behalf of the Board
H Ratshefola C Wilkins G Fowler
Chairman Chief Executive Officer Financial Director
27 May 2010
Transfer secretaries:
Link Market Services (Pty) Ltd
11 Diagonal Street, Johannesburg, 2001
Company secretary and registered office:
DM Hughes
Ground Floor, Victoria Gate South, Hyde Park Lane, Sandton, 2199
Directors:
HMH Ratshefola (Chairman)*, CJ Wilkins (Group CEO), G Fowler (FD),
DM Hughes*, MEJ Mamogale**, R Fehrsen**
*Non-executive director **Independent non-executive director
Designated Advisor:
Grindrod Bank Limited
Date: 27/05/2010 09:00:01 Produced by the JSE SENS Department.
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