| Thu 12 Apr 2001, 0:00 | | Itech - Financial Results |
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INTEGRATED TECHNOLOGY HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 90/09928/06)
("iTech")
Financial results for the year ended 31 December 2000
Summarised Consolidated Income Statement
Reviewed Audited
for the year for the year
ended ended
31 Dec 2000 31 Dec 1999
Gross Revenue 16 399 26 524
Operating profit/(loss) before
interest & taxation (2 837) (2 753)
Net finance charges received/(paid) (87) 227
Net profit/(loss) before
exceptional item (2 924) (2 526)
Exceptional item - 6 038
Net profit/(loss)
after exceptional item (2 924) (8 564)
Taxation - 436
Net profit/(loss) after taxation (2 924) (9 000)
Income from associated company 5 200 4 150
Profit attributable to/(from)
outside shareholders - (27)
Net profit/(loss) attributable to
shareholders 2 276 (4 823)
Shares in issue 100,221 75 637
Headline earnings per share (cents) 2,27 1,61
Earnings per share (cents) 2,27 (6,38)
Summarised Consolidated Income Statement
Reviewed Audited
for the year for the year
ended ended
31 Dec 2000 31 Dec 1999
ASSETS
Non-current assets 28 146 17 443
Property, plant and equipment 876 899
Investments and loans receivable* 27 270 16 544
Current assets 5 161 10 843
Trade and other receivables 5 159 9 828
Cash and cash equivalents 2 1 015
Total assets 33 307 28 286
EQUITY AND LIABILITIES
Capital & reserves 27 848 20 335
Issued capital and premium 28 985 23 923
Accumulated profit/(loss) (1 137) (3 588)
Outside shareholders' interest (27) (27)
Non-current liabilities 1 444 1 543
Non-interest bearing borrowings 1 444 1 543
Current liabilities 4 041 6 434
Trade and other payables 4 041 6 434
Total equity and liabilities 33 307 28 286
Announcement to shareholders
Announcement to shareholders regarding:
- the disposal of the shares in and claims against Synergy Computing
(Proprietary) Limited and Synergy Computing (Cape Town) (Proprietary) Limited
(collectively "Synergy");
- the disposal of 50% of the shares in and claims against IQ Health Tech
(Proprietary) Limited ("IQHT");
- the delisting of the company from the JSE Securities Exchange South Africa
("JSE"); and
- the voluntary winding up of the company.
(collectively "the proposals")
Consolidated Cash Flow Statement
31 Dec 2000 31 Dec 1999
Cash (absorbed)/generated
by operations 5 076 (6 754)
Net investment income/expense (89) 227
Taxation paid (167) (71)
Cash flows from operating activities 4 820 (6 598)
Cash flows from financing activities 4 963 15 144
Net investment activities (10 796) (9 817)
Net decrease in cash equivalents (1 013) (1 271)
1. Introduction
Further to the cautionary announcement that was published in the press on 23
January 2001, Benefique Capital is authorised to announce that iTech has
disposed of its interest in Synergy and IQHT (collectively "the disposals")
subject to the fulfilment of certain conditions precedent set out in paragraphs
3.1 and 3.2 below.
Following the disposals, iTech's only asset will be the cash consideration
received from the disposals and the company will not hold any operating assets.
As the company is disposing of its operating assets, ordinary resolutions must
be passed by shareholders in general meeting in terms of section 228 of the
Companies Act, 1973 (Act 61 of 1973) as amended, approving the disposals.
iTech will distribute the cash by way of a dividend to shareholders in
anticipation of liquidation. Thereafter iTech will be delisted and wound-up.
2. Background and rationale for the proposals
iTech shares have been trading on the JSE at a substantial discount to net
asset value per share for some time. In order to maximise shareholder value,
the directors of iTech have resolved to dispose of the operating assets for
cash and to distribute the cash to shareholders as this will maximise
shareholder value.
3. The disposals
3.1 The disposal of Synergy
iTech has disposed of Synergy with effect from 1 January 2001, for a cash
consideration of R3 million. The purchasers are Anda Financial Services
Limited, (registration number 6/2000/6747), a company registered in Mauritius,
JLP Properties (Proprietary) Limited (registration number 1999/21233/07), a
company registered in South Africa, and Dale Investments Limited (registration
number 6/2000/7783), a company registered in Mauritius.
iTech has provided the warranties which are usual in transactions of this
nature and the disposal is subject to the following material conditions
precedent:
- the approval of the disposal by iTech shareholders in general meeting; and
- the approval of the disposal by the JSE, the Securities Regulation Panel
("SRP") and any other applicable regulatory bodies.
3.2 The disposal of IQHT
iTech has disposed of IQHT with effect from the closing date of the
transaction, expected to be 11 June 2001, for a cash consideration of R22,4
million. The purchaser is IQ Health (Proprietary) Limited (registration number
1998/000498/07), a company registered in South Africa ("IQ Health").
iTech has not provided any warranties to IQ Health by virtue of the fact that
IQ Health has had the effective operational and management control of IQHT.
This disposal is subject to the following material conditions precedent insofar
as iTech is concerned:
- the approval of the disposal and of the voluntary winding up of iTech by the
shareholders in general meeting;
- the payment by iTech of an interim dividend to its shareholders in
anticipation of liquidation of not less than 15,6 cents per iTech share; and
- the approval of the disposal by the JSE, SRP and any other applicable
regulatory bodies.
4. Termination of listing and voluntary winding up of iTech
In order for the listing of iTech to be terminated, shareholders, excluding
controlling shareholders as defined by the JSE Listings Requirements, must vote
in favour of an ordinary resolution in general meeting giving effect thereto.
The voluntary winding up of the company will require the passing of a special
resolution by shareholders in general meeting.
Following the passing of the requisite resolutions, the listing of iTech will
be terminated and this is anticipated to take place at the close of business on
Friday, 8 June 2001. An interim dividend of 15,6 cents per iTech share will be
declared in anticipation of liquidation and the company will be wound-up. A
final liquidation dividend will be paid to iTech shareholders. It is
anticipated that the total dividend to be received by shareholders will be the
sum of 18 cents per share.
5. Financial effects of the proposals
The table below sets out the pro forma effects of the proposals on the market
value, net asset value and earnings per iTech share, after taking into account
the following:
- the effect on earnings per share assumes that the proposals had been
implemented for the 12 month period ended 31 December 2000;
- the effect on net asset value per share assumes that the proposals were
implemented on 31 December 2000;
- the market price on 10 April 2001 of 11 cents per iTech ordinary share has
been assumed, being the closing price on the last practicable date prior to the
issue of this announcement;
- the earnings on the total cash received per share after the payment of the
final dividend assumes that the cash consideration was invested at a call rate
of 9%; and
- the net asset value and earnings per iTech share are based on the results of
iTech for the 12 months ended 31 December 2000.
Before proposals Cash received %
Per share (cents) (cents) change
Market price 11 18 63,6
Earnings 2,27 1,62 (28,6)
*Net asset value 27,7 18 (35,0)
6. Related parties
With regard to the disposal of IQHT, Tirade Props 46 (Proprietary) Limited, a
material shareholder of iTech and Antonie Troskie Moolman, a director of iTech,
("the related parties") will acquire an interest in The IQ Business Group, the
holding company of
IQ Health. In light of this, the related parties will be disqualified from
voting on the resolution approving the disposal of IQHT in respect of any iTech
shares held by them or their associates.
7. Documentation
A circular containing details of the proposals and convening a general meeting
of iTech shareholders will be posted to shareholders within 28 days of this
announcement or such later time as may be agreed to by the JSE and SRP.
S. Brits
Johannesburg
12 April 2001
ITech sells its stake in IQ Health Tech to IQ Health
Agreement settles all disputes between parties
Press Release
12 April 2001
Integrated Health Technologies (ITech), a JSE-listed information technology
company, is to sell its 50% stake in IQ Health Tech - the practice management
and hospital administration software development subsidiary of IQ Health - to
IQ Health, which already owns 50% and has management and operational control of
IQ Health Tech.
The transaction is valued at R22,4-million together with a portion of interest
and will be implemented by June 10, 2001. The purchase price will be paid in
cash.
The joint announcement follows the conclusion of negotiations, which commenced
in September 2000, and also entails the settlement of all disputes and
litigation between the two companies.
If this transaction is approved by the shareholders of ITech, the board of
directors of ITech will recommend to shareholders that the cash be distributed
to shareholders through a dividend, where after ITech will be voluntarily wound
up by its members. The Sale Agreement stipulates a minimum dividend of 15,6
cents a share, which is significantly more than the ruling trade price for the
shares and as such will result in substantial value realisation for ITech
shareholders.
Major shareholders in Itech, namely Africa Group and Sanlam Life Assurance
(through Africa Group) will take up shares in The IQ Business Group - the
holding company of IQ Health - at a premium to the market value, in lieu of
dividend payments.
About The IQ Business Group
The IQ Business Group is a thought leadership organisation, focussing on the
holistic design, implementation and management of technology enabled business
process solutions. The company has grown in just under two years into a
R425-million IT leader that is regarded as one of South Africa's premier
unlisted information technology players. From an initial capitalisation of
R22-million in July 1998, IQ had a turnover of R177-million in its first full
financial year to March 31, 2000 and is forecasting revenues of R301-million
for the coming year.
Starting off with a core of 19 professionals in 1998, IQ's staff complement has
grown to 880, most of whom are university graduates with skills in commerce and
information systems. In addition, IQ sports a set of industry-focussed
development and operational outsourcing teams focussed in the financial
services, healthcare, and logistics industries.
IQ has grown its business by partnering with leading players in niche sectors
that see information technology as strategic to their growth objectives. These
partners include Fedsure Financial Services Group, Fedsure Health, Reunert,
OneLogix, NSP Buck (Australia) and Nedcor, which took a 25% stake in IQ worth
R142-million in August 2000.
Issued on behalf of client : IQ Business Group
Client Contact : Johan Roets
Tel No : (011) 268 6927
Email : jroets@iqgroup.net
Editorial Contact : Kerry Botha
Tel No : (011) 803 5504
Fax No : (011) 803 0422
Email : Kerryb@kerrybothapr.co.za
Kerry Botha PR : Tel. (011) 803 5501
Fax : (011) 803 0422
Cell : (083) 263 0644
e-mail : kerryb@kerrybothapr.co.za
