| Tue 14 Sep 2010, 8:42 | | GIJ - Gijima Group Limited - Trading statement and update on dispute over |
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GIJ
GIJ
GIJ - Gijima Group Limited - Trading statement and update on dispute over
contract
GIJIMA GROUP LIMITED
(Formerly Gijima AST Group Limited)
(Incorporated in the Republic of South Africa)
Registration number 1998/021790/06
Share code: GIJ
ZAE000147443
("Gijima" or "the Company")
TRADING STATEMENT AND UPDATE ON DISPUTE OVER CONTRACT
Trading Statement
Gijima is currently finalising its results for the twelve months ended 30 June
2010, which are planned for release on SENS on or about 28 September 2010.
In this regard, shareholders are advised that Gijima`s reported basic earnings
per share ("EPS") and headline earnings per share ("HEPS") for the twelve months
ended 30 June 2010 are expected to improve by between 35% and 55% from the
reported profit per share for the twelve months ended 30 June 2009.
Gijima`s profits have in previous reporting periods been impacted by foreign
exchange translation differences on consolidation of its intergroup loan
accounts denominated in foreign currencies. These translation differences no
longer impact the Company`s profits and are, from 1 July 2009, recorded within
the Company`s equity. This treatment is in line with International Accounting
Standard 21: The effects of Changes in Foreign Exchange Rates, and follows
management`s assessment and classification of the underlying intergroup loan
accounts as part of Gijima`s net investment in the relevant non-trading foreign
operations. Should the impact of these foreign exchange translation differences
be eliminated in the comparative reporting period (namely the twelve months
ended 30 June 2009), Gijima`s EPS and HEPS for the twelve months ended 30 June
2010 are expected to improve by up to 10%, in the range of 15.00 cents and 17.00
cents, from the normalised EPS and HEPS for the twelve months ended 30 June
2009.
These numbers reflect a conservative approach to recognizing the revenue earned
by Gijima in relation to the "Who Am I Online" contract with the Department of
Home Affairs ("the Department") in acknowledgement of certain project
uncertainties up to year-end that flowed from the letter Gijima received from
the Department in which the validity of the contract was contended. An update on
the dispute over the contract is provided below.
The financial information on which this trading statement is based has not been
audited and reported on by the Company`s auditors.
Update on dispute over contract
Shareholders are referred to the SENS announcements released on 15 April 2010
and 10 August 2010, where Gijima reported that it had received a letter dated 13
April 2010 from the Department of Home Affairs, in which the Department
contended the validity of a contract it concluded with Gijima in June 2008. The
contract for the "Who Am I Online" system covers the design, development and
implementation of an integrated core system for the Department, including all
business processes of both its Civics and Immigration Divisions.
Shareholders are advised that Gijima continues to engage in without prejudice
negotiations with the South African Government to resolve the dispute regarding
the contract. Gijima remains committed to pursuing a commercial resolution in
order to avoid litigation to resolve the dispute.
Samrand
14 September 2010
Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 14/09/2010 08:42:01 Produced by the JSE SENS Department.
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