| Wed 1 Dec 2010, 7:30 | | ZPT - Zaptronix Limited - Reviewed condensed consolidated financial statements |
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ZPT
ZPT
ZPT - Zaptronix Limited - Reviewed condensed consolidated financial statements
for the year ended 31 august 2010
ZAPTRONIX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1997/014928/06)
(Share Code: ZPT ISIN Code: ZAE000070934)
("Zaptronix" or "the company")
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
31 August 2010 31 August 2009
(Reviewed) (Audited)
Assets
Non-current assets
Property, plant and 7 096 700 4 853 771
equipment
Intangible assets 1 995 942 1 177 083
Current assets
Inventories 2 491 766 1 981 121
Trade and other 6 455 765 4 197 791
receivables
Cash and cash equivalents 107 117 119 622
Other financial assets 256 869
Total assets 18 147 290 12 586 257
Equity and liabilities
Equity
Share capital and 29 751 963 29 751 963
Reserves
Accumulated (Loss) (25 282 231) (27 270 163)
Liabilities
Non-current liabilities
Deferred tax 232 270 387 128
Current liabilities
Trade and other payables 8 618 864 6 073 594
Other financial 4 519 424 3 305 658
liabilities
Provisions 103 019
Current tax payable 307 000 235 058
Total equity and 18 147 290 12 586 257
liabilities
Number of shares in issue 379 318 934 379 318 934
Net asset value per share 1.18 0.76
(cents)
Tangible net asset value 0.65 0.40
per share (cents)
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
31 August 2010 31 August 2009
(Reviewed) (Audited)
Revenue 20 721 476 29 144 284
Gross profit 17 370 650 19 919 740
EBITDA 4 517 548 166 118
Depreciation (1 878 846) (2 097 966)
Interest paid (735 869) (290 676)
Interest received 2 092 23 751
Profit/(loss) before 1 904 925 (2 198 773)
taxation
Taxation 82 917 (384 622)
Profit/(loss) for the 1 987 842 (2 583 395)
year
Total comprehensive 1 987 842 (2 583 395)
income/(loss) for the
year
Basic/Diluted 0.52 (0.68)
earnings/(loss )per share
(cents)
Basic/Diluted Headline 0.52 (0.68)
earnings/(loss) per share
(cents)
Weighted average number 379 318 934 379 318 934
of shares in issue
Reconciliation of
headline earnings/(loss):
Net profit/(loss) 1 987 842 (2 583 395)
attributable to ordinary
shareholders
Headline earnings/(loss) 1 987 842 (2 583 395)
attributable to ordinary
shareholders
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued Reserves Accumulated Total equity
share Loss
capital
Balance at 1 29 632 341 170 149 (24 737 295) 5 065 195
September 2008
Movements during the
year
Realisation of re- (50 527) 50 527
valued assets
Total comprehensive (2 583 395) (2 583 395)
loss for the year
- -
Balance at 31 August 29 632 341 119 622 (27 270 163) 2 481 800
2009
Movements during the
year
Total comprehensive 1 987 842 1 987 842
income for the year
Balance at 31 August 29 632 341 119 622 (25 282 231) 4 469 642
2010
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
31 August 31 August 2009
2010
(Reviewed) (Audited)
Cash flows from operating 3 457 503 579 923
activities
Cash flows from investing (4 683 766) (119 429)
activities
Cash flows from financing (1 213 766) (913 397)
activities
Cash flows for the year (12 498) (452 903)
Cash and Cash equivalents at 119 615 572 518
beginning of year
Cash and Cash equivalents at 107 117 119 615
end of year
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL INFORMATION
COMMENTARY
Introduction
The results for 2010 reflect the return to profitability of the group. This is
due to the contribution made to the Net Income earned from the management of
the I to I assets in terms of an Agency Agreement as referred to in previous
SENS announcements. Shareholders are referred to the SENS announcement dated 6
September 2010 announcing the transaction to purchase certain assets from I to
I Technology Solutions Limited ("I to I"). Zaptronix managed the assets
pending the approval by the shareholders of the acquisition of assets.
Zaptronix earned R3 529 241 of Net Income for the period 1 March to 31 August
2010 in terms of the Agency Agreement. The Net Income earned in the current
period from I to I is attributable to Zaptronix regardless of the shareholders
approval of the I to I transaction.
Financial Results
The turnover decrease is a result of the restructured operations of Zaptronix
Energy Management Services ("EMS"), a division of Zaptronix, as the activities
associated with the I to I assets have been merged as a consequence of the
Agency Agreement and with the pending approval of the transaction by
shareholders, will be absorbed into Zaptronix. The Group returned a Net Income
of R1 987 842 compared to the loss of R2 583 395 in 2009.
Basis of preparation
The reviewed condensed consolidated results have been prepared in accordance
with the Framework concepts and the measurement and recognition requirements
of the International Financial Reporting Standards, containing information
required by the IAS 34 Financial Reporting as well as AC 500 standards as
issued by the Accounting Practices Board or its successor, the JSE Limited
Listings Requirements and in the manner required by the Companies Act. These
results must be read in conjunction with the most recently issued annual
financial statements.
Significant accounting policies
The reviewed condensed consolidated annual financial statements have been
prepared under the historical cost convention other than financial instruments
accounted for in terms of IAS 39.
The accounting policies, presentation and methods of computation applied in
preparation of these reviewed condensed consolidated annual financial
statements are consistent with those applied in the group`s audited financial
statements for the year ended 31 August 2009 save for the new application of
IFRS 8: Operating Segments and IAS 1: Presentation of Financial Statements -
Revised and the amended IAS 1: Presentation of Financial Statements
IFRS 8 replaces IAS 14: Segment Reporting and requires an entity to adopt a
"management approach" to reporting the financial performance of its segments.
In accordance with the requirements of IFRS 8 the segmental reporting is now
prepared based on the business units as reported internally by management and
has had no significant impact on group segmental reporting. The group has
complied with the revised naming conventions as required by IAS 1 and reports
one Statement of Comprehensive Income. In terms of IAS 1 certain items
previously reported in the Statement of Changes in Equity are now disclosed in
the Statement of Comprehensive Income.
The preparation of the results required the use of estimates and assumptions
that affect the values of assets and liabilities at the reporting date.
Although these estimates are based on management`s best knowledge of current
events and actions that the group may undertake in the future, actual results
may differ from those estimates.
Unqualified review opinion
The condensed consolidated annual financial results have been reviewed by the
company`s auditors, PKF (Pta) Inc. Their unqualified review report is
available for inspection at the company`s registered office.
Property, Plant and equipment
During the period, the group acquired R 3 312 765 of property, plant and
equipment to maintain current operations. There has been no disposal during
the period.
Taxation
The effective tax rate for the group in the current period is 4.35%. This is a
result of assessed losses from prior years not being recognised as a deferred
tax asset in the current year.
Segment report
The Fleet Management division contributed 63% of group revenue, RMS Technology
division contributed 10% and Metering and Corporate division contributed the
balance of 27% of group revenue. Previously the Duo SP and Zaptronix Systems
were reported on separately, however the two segments are interlinked in that
Zaptronix Systems holds the rental assets utilised by the Duo SP tracking
service and consequently from 2010 the two units have been combined.
CONDENSED SEGMENT REPORT
31 August 31 August 2009
2010
(Reviewed) (Audited)
Segment Revenue:
Fleet management (Duo SP and 15 199 761 17 148 517
Zaptronix Systems)
RMS Technology 2 423 537 9 910 245
Zaptronix (Metering and 6 635 686 2 085 522
Corporate)*
Internal segment revenue (3 537 508) -
External revenue total 20 721 476 29 144 284
Operating (loss)/profit segment results (before interest and
taxation):
Fleet management (Duo SP and 2 351 335 1 825 977
Zaptronix Systems)
RMS Technology (419 087) (1 792 717)
Zaptronix (Metering and 706 316 (1 965 102)
Corporate)
Total 2 638 564 (1 931 482)
Segment assets
Fleet management (Duo SP and 9 839 474 6 420 962
Zaptronix Systems)
RMS Technology 4 057 073 2 072 539
Zaptronix (Metering and 4 250 743 4 092 756
Corporate)*
18 147 290 12 586 257
* The segment includes R3 529 241 earned from I to I in terms of the Agency
Agreement.
Related parties
During the year, certain subsidiaries, in the ordinary course of business
entered into various loans and transactions with related parties under terms
that are no less favourable than those arranged with third parties.
Transactions and balances between the company and its subsidiaries, which are
related parties of the company, have been eliminated on consolidation,
Zaptronix will purchase selected assets from the I to I group, as announced on
SENS on 6 September 2010 and is earning an agency fee for the management of
certain assets. The two transactions mentioned are related party transactions
as I to I is owned by the Gandalf Trust. Jan Nel and Karl Gribnitz who are
major shareholders and directors of Zaptronix, are also trustees of the
Gandalf Trust.
Dividend
No dividend is proposed.
Post Balance sheet events
With reference to the SENS announcement released on 6 September 2010, the
transaction to buy assets from I to I for R 6.6 million to be payable in
shares is subject to shareholders` approval. The transaction includes the
purchase of certain assets for the issue of Zaptronix ordinary shares at a
price of 1.5 cent per share as well as the capitalisation of the shareholder
loans amounting to R 3 771 425 at a price of 3 cents per share. The impact of
the transaction if recorded as at 31 August 2010 on Zaptronix`s statement of
financial position would be as follows:
31 August 31 August
2010 2010
(Including I (Reviewed)
to I
transaction)
Assets
Non-current assets
Property, plant and equipment 7 998 700 7 096 700
Intangible assets 1 995 942 1 995 942
Current assets
Inventories 3 023 528 2 491 766
Trade and other receivables 8 161 553 6 455 765
Cash and cash equivalents 2 443 449 107 117
Other financial assets 1 124 118
Total assets 24 747 290 18 147 290
Equity and liabilities
Equity
Share capital and Reserves 40 123 233 29 751 963
Retained (Loss) (25 282 231) (25 282 231)
Liabilities
Non-current liabilities
Deferred tax 232 270 232 270
Current liabilities
Trade and other payables 8 618 864 8 618 864
Other financial liabilities 748 154 4 519 424
Provisions
Current tax payable 307 000 307 000
Total equity and liabilities 24 747 290 18 147 290
Prospects
The economic downturn has affected the Fleet Management division. The board
has however approved plans to invest in the competitiveness of the offering by
the continual development of features that addresses client needs on the DuoVI
system. Technology partners has further been engaged to keep expanding the
offering on this level.
The Zaptronix group is still well placed to benefit from the Metering Division
and the prospective demand for smart meters which is aimed to address the
problems associated with balancing the supply and demand for electricity in
South Africa. The lack of a BBBEE compliant status limited Zaptronix to only
offer products outside of the utility domain. The review of the BBBEE status
rating to that of a level 4, has addressed this issue. Zaptronix is further
developing solutions with its technology partners in this domain.
The business created out of the assets bought from I to I, branded the Site
Risk business, is proving to be an excellent addition to the Zaptronix
business model. The new business unit have recently been awarded contracts in
the order of R5 million from blue chip companies.
After the transaction the group will have a strong, un-geared balance sheet
which will give it the ability to move forward and utilise any future
opportunities. The opportunity for the cross selling of products and services
to the client base of I to I is further being capitalised on.
Broad Based Black Economic Empowerment ("BBBEE")
Zaptronix reviewed its BBBEE status given the profile created with the new
Site Risk business. Zaptronix is now rated as a level 4 contributor.
By order of the Board
30 November 2010
Jan Nel; Barry Botes
Chief Executive Officer Chief Financial Officer
CORPORATE INFORMATION
Non executive directors: N Melville (Chairman), P Reeves, Dr M J
Freestone and K J Gribnitz
Executive directors: J P Nel (CEO), A J Botes (CFO),
Registration number: 1997/014928/06
Registered address: Gazelle Close, Corporate Park South
Old Johannesburg Road, Midrand
Postal address: PO Box 8291, Midrand, 1685
Company secretary: Sylvan CSI (Pty) Ltd
Telephone: +27 11 238 2000
Facsimile: +27 11 238 2075
Transfer secretaries: Computershare Investor Services (Pty)
Limited
Designated Adviser: Exchange Sponsors (2008) (Pty) Limited
Date: 01/12/2010 07:30:01 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
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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.
