| Mon 5 Mar 2001, 0:00 | | Digicor Holdings - Interim Results |
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DIGICOR HOLDINGS LIMITED
Interim results for the six months ended 31 December 2000 Comments
The directors of DigiCore Holdings Ltd, South Africa's foremost fleet
management solutions company, are proud to announce its interim results for the
six months ended 31 December 2000. Revenue increased fourfold to R173,3m (1999:
R43,2m), putting the company on track to meet its R300m annual revenue forecast
made in their September 2000 Investor Progress Report.
Operating profit increased in correlation with revenue, reaching R23,7m. Net
financing costs declined materially. Overall, the group's cash position
improved by approximately R36m over the past six months.
An amount of R1,7m, relating to capitalised listing expenses not allowed during
assessment by the Receiver of Revenue, contributed to the higher tax charge.
The increased working capital relates directly to the growth in sales volumes.
With the number of shares in issue remaining constant at 239 256 113, headline
earnings per share of 6,17 cents rose by 298 percent over the previous
reporting period. No dividend will be declared at interim stage.
Shareholders should note that the initial R150m debis order was fulfilled by
the end of February. With phase two of the five-year contract now in progress,
future revenues will be derived from de-installation, re-installation and
maintenance of C-Track units in the debis fleet outsourced by Telkom.
Following the successful completion of phase one, C-Track has now become the de
facto standard for all future fleet management systems implemented in
co-operation with debis Fleet Management, as well as in association with
several other equivalent industry players.
DigiCore now dominates the fleet management sector, estimated at some 1,2
million vehicles, and outselling competitors on a 7:3 ratio.
GROUP VISION
DigiCore strives to attain world leadership in fleet management solutions
through continued research and development and total commitment to service and
customer satisfaction. The group seeks to achieve outstanding long-term
profitability for our shareholders, whilst maintaining a high standard of
ethics, and developing and rewarding our employees accordingly.
BUSINESS REVIEW
Despite the South African transport industry remaining under pressure due to
lower consumer demand, fuel increases, and persistent overcapacity aggravated
by low rate structures, DigiCore Fleet Management sustained its market share
without sacrificing sales margins with revenue gains marginally higher, even
when excluding the debis contract.
Internationally, DigiCore Pakistan managed to secure a deal with Honda, laying
the foundation for all future transactions in this region. Overall, DigiCore
Pakistan contributed 35 percent to global exports, with growth in sales orders
increasing by 275 percent over the past six months.
The successful business model established in the Benelux over the past 18
months is now being replicated throughout Europe. With the product now
familiarised in this large market and augmented by a culture of payment, strong
growth is expected in this relatively untapped market.
DigiCore Australia, however, has not performed to expectation. Management has
decided to review the group's business strategy in this region after
approximately three years and an investment of R2,8m.
In an effort to better current decision-making and cost control, a proven ERP
system is being implemented.
Dr Nardus Truter was recently appointed as group managing director of DigiCore.
The group will benefit from his 18 years of South African, Sub-Saharan and
North African experience in the transportation, vehicle and fleet management
retail industries.
Dr Truter played a major role in establishing and managing Viamax Fleet
Management (Pty) Ltd, a black empowerment fleet management enterprise. He also
acted as managing director of BMW & Land Rover Egypt from early 1999 to July
2000.
Ndaba Ntsele has been appointed as an alternate non-executive member of the
board. He is the chief executive of Pamodzi Investment Holdings Ltd, DigiCore's
successful black empowerment partner. With Pamodzi's recent investment in
Alacrity Financial Services Ltd, they will now add even more value to DigiCore
Fleet Management.
RESEARCH AND DEVELOPMENT
Research and development costs are expensed as incurred and amounts to
approximately ten percent of pre-tax profits.
CAPITAL EXPENDITURE
No significant capital expenditure is foreseen within the coming months.
PROSPECTS
DigiCore is in the process of identifying other strategic partners in the
vehicle manufacturing, financing and insurance industries. It is also
anticipated that business opportunities in South Africa are to result from the
accelerated privatisation of government assets.
Based on the successful project management and implementation programme of the
debis tender, DigiCore is well positioned to capitalise on global opportunities
that will present themselves over the next 12 months.
On behalf of the board
BP VUNDLA NH VLOK
Chairman Executive deputy chairman
5 March 2001
DigiCore Holdings Limited
20 Eclington Crescent Highveld Techno Park Centurion
Transfer secretaries
Consolidated Share Registrars Limited Edura House
40 Commissioner Street Johannesburg PO Box 61051 Marshalltown 2107
directors: BP Vundla (Chairman)*, NH Vlok (Deputy Chairman), Dr LE Truter (MD),
SR Aberdein, FW Britz,
D du Rand, KR Stanton, JJ du Plooy*, SA Msibi*,
DJO Sauerbier*#, NA Ntsele*+
*Non-executive # German + AlternateGroup income statement
Six months Six months Year
ended ended ended
31/12/00 31/12/99 30/06/00
R'000 Unaudited Unaudited Audited
Revenue 173 273 43 171 97 267
Operating profit before
depreciation 27 664 7 243 8 141
Depreciation (3 346) (1 486) (4 323)
Amortisation of goodwill (607) 0 0
Operating profit after depreciation 23 711 5 757 3 818
Net finance cost (772) (1 119) (2 505)
Headline earnings 22 939 4 638 1 313
Taxation 8 782 1 300 272
Profit after taxation 14 157 3 338 1 041
Statistics
Number of shares in issue ('000)
- end of period 239 256 215 000 239 256
- weighted average 239 256 215 000 225 810
Earnings per share (cents) 5,9 1,6 0,4
Headline earnings per
share (cents)
- weighted average 6,2 1,6 0,5
Reconciliation of headline earnings
Six months Six months Year
ended ended ended
31/12/00 31/12/99 30/06/00
R'000 Unaudited Unaudited Audited
Profit after taxation 14 157 3 338 1 041
Amortisation of goodwill 607 0 0
Headline earnings 14 764 3 338 1 041
Balance sheet
Six months Six months Year
ended ended ended
31/12/00 31/12/99 30/06/00
R'000 unaudited unaudited Audited
Capital employed
Shareholders' funds 83 639 47 520 69 482
Long-term liabilities 4 060 6 444 4 649
Deferred taxation 529 862 529
Total capital employed 88 228 54 826 74 660
Employment of capital
Fixed assets 7 861 12 056 7 025
Investments and loans 11 576 9 649 8 040
Intangible assets 29 198 0 31 023
Net current assets 39 593 33 121 28 572
Trade and other receivables 32 501 41 025 36 777
Inventory 34 187 22 591 22 168
Bank and cash on hand 21 932 3 066 3 273
Trade and other payables (40 608) (6 633) (14 248)
Taxation (8 419) (6 556) (1 706)
Bank overdraft 0 (20 372) (17 692)
Total employment of capital 88 228 54 826 74 660
Statement of changes in equity
Six months Six months Year
ended ended ended
31/12/00 31/12/99 30/06/00
R'000 Unaudited Unaudited Audited
Balance at beginning of period 69 482 44 182 44 182
Issue of share capital
and share premium 0 0 24 259
Net profit for the period 14 157 3 338 1 041
Balance at end of period 83 639 47 520 69 482
Summarised cash flow statement
Six months Year
ended ended
31/12/00 30/06/00
R'000 Unaudited Audited
Cash flow from operations 46 281 8 695
Net financing costs (772) (2 505)
Taxation paid (2 069) (7 939)
Cash flow from operating activities 43 440 (1 749)
Cash flow from investing activities (6 516) (30 651)
Cash flow from financing activities (589) 26 070
Net movement in cash resources 36 335 (6 330)
Cash and cash equivalents at
beginning of period (14 403) (8 073)
Cash and cash equivalents at
end of period 21 932 (14 403)
Accounting policies
The same accounting policies and methods of computation have been used in the
preparation of these interim financial statements that were used in the annual
financial statements to 30 June 2000.
Dividends
No dividends have been declared for the period under review
Strate
DigiCore Holdings Ltd has been notified by the JSE Securities Exchange that the
company's share capital will be transferred to the electronic STRATE ("Share
Transactions Totally Electronic") environment as from 26 March 2001. This is
the date from which investors' shares will be converted into an electronic
record in order to become eligible to settle in the STRATE
environment.Graphicor 22891
