| Fri 22 Mar 2013, 16:45 | | SecureData Holdings Limited Unaudited results for the six months ended 31 January 2013 |
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SDH
Unaudited results for the six months ended 31 January 2013
SecureData Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1998/010017/06)
Share code: SDH ISIN: ZAE000096368
("SecureData" or "the group")
Unaudited Results
for the six months ended 31 January 2013
Condensed Consolidated Statement of Comprehensive Income
[for the six months ended 31 January 2013]
Unaudited Reviewed Audited
six months six months twelve months
ended ended ended
31 January 2013 31 January 2012 31 July 2012
R~000 R~000 R~000
Revenue 138 096 119 469 222 229
Earnings before interest, taxation,
depreciation and amortisation (EBITDA)
and other financial items 845 284 (44 961)
Depreciation and amortisation (1 538) (1 984) (4 109)
Depreciation (826) (544) (1 345)
Amortisation (712) (1 440) (2 764)
Loss from operations (693) (1 700) (49 070)
Finance income 1 854 110 161
Finance costs (41) (1 540) (3 590)
Other financial items 2 046 2 062 (695)
Profit/(loss) before taxation 3 166 (1 068) (53 194)
Taxation (1 113) (355) 5 469
Normal taxation (1 113) (355) 5 469
Profit/(loss) on continuing operations 2 053 (1 423) (47 725)
Discontinued operations (Note 1) 10 382 9 631
Profit/(loss) for the period 2 053 8 959 (38 094)
Attributable to:
owners of the parent 2 053 8 834 (39 395)
minority interest 125 1 301
Profit/(loss) for the period 2 053 8 959 (38 094)
Profit/(loss) for the period 2 053 8 959 (38 094)
Foreign exchange conversion movements 1 7 796 25 440
Total comprehensive income/(loss)
for the period 2 054 16 755 (12 654)
Attributable to:
owners of the parent 2 054 15 390 (14 809)
minority interest 1 365 2 155
Total comprehensive income/(loss)
for the period 2 054 16 755 (12 654)
Earnings/(loss) per share (cents) 0,9 3,9 (17,3)
Continued operations 0,9 (0,6) (20,9)
Discontinued operations 4,5 3,6
Diluted earnings/(loss) per share (cents) 0,9 3,9 (17,3)
Continued operations 0,9 (0,6) (20,9)
Discontinued operations 4,5 3,6
Weighted average numbers of shares on which:
earnings per share is based (~000) 227 129 228 395 228 395
diluted earnings per share is based (~000) 227 129 228 395 228 395
Number of ordinary shares in issue (~000) 246 320 246 320 246 320
Reconciliation between earnings and
headline earnings:
Profit/(loss) for the period attributable to
ordinary shareholders 2 053 8 834 (39 395)
Goodwill written off 2 359
Loss on disposal of subsidiary 118 1 112
Loss on disposal of property, plant and
equipment net of tax (25) 1 161
Headline earnings 2 171 8 809 (34 763)
Headline earnings per share (cents) 1,0 3,9 (15,2)
Continued operations 1,0 (0,6) (19,4)
Discontinued operations 4,5 4,2
Reconciliation between earnings and
adjusted earnings:
Profit/(loss) for the period attributable
to ordinary shareholders 2 053 8 834 (39 395)
Amortisation (after taxation) 513 3 567 6 656
Goodwill written off 2 359
Loss on disposal of subsidiary 118 1 112
Derivatives (after taxation) (1 558) (1 485) (1 198)
Foreign exchange losses on group loans
(after taxation) (6 525) (9 082)
Adjusted earnings 1 126 4 391 (39 548)
Adjusted earnings per share (cents) 0,5 1,9 (17,3)
Continued operations 0,5 (0,8) (19,5)
Discontinued operations 2,7 2,2
Note 1
Discontinued operations
Revenue 116 244 220 317
Earnings before interest, taxation,
depreciation and amortisation (EBITDA)
and other financial items 11 954 17 360
Depreciation and amortisation (4 146) (7 707)
Depreciation (727) (1 402)
Amortisation (3 419) (6 305)
Profit from operations 7 808 9 653
Finance income 10 67
Finance costs 7 612 9 486
Interest paid (1 452) (3 126)
Foreign exchange gains/(losses) on loan
to subsidiary 9 064 12 612
Profit before taxation 15 430 19 206
Taxation (5 048) (8 463)
Normal taxation (5 048) (8 463)
Loss on sale of subsidiary (1 112)
Profit for the period 10 382 9 631
Condensed Consolidated Statement of Financial Position
[at 31 January 2013]
Unaudited at Reviewed at Audited at
31 January 2013 31 January 2012 31 July 2012
R~000 R~000 R~000
ASSETS
Non-current assets 64 328 213 802 65 917
Property, plant and equipment 3 396 6 420 3 836
Goodwill 37 459 135 713 37 459
Intangible assets 4 633 37 544 5 084
Deferred tax asset 18 840 34 125 19 538
Current assets 106 667 187 650 139 415
Inventories 12 650 16 026 7 482
Trade and other receivables 51 753 146 295 41 207
Taxation prepaid 1 296 724 1 139
Cash and cash equivalents 40 968 24 605 89 587
Total assets 170 995 401 452 205 332
EQUITY AND LIABILITIES
Equity 88 049 185 554 143 402
Share capital 246 246 246
Share premium 57 320 118 900 118 900
Treasury shares (19 163) (23 336) (23 336)
Share-based payment equity reserve 1 255 3 348 1 255
Foreign currency translation reserve 26 (18 005) 25
Retained earnings 48 365 92 448 46 312
Equity attributable to owners of the parent 88 049 173 601 143 402
Minority interest 11 953
Non-current liabilities 1 159 13 428 1 301
Loans and borrowings 3 116
Deferred tax liability 1 159 10 312 1 301
Current liabilities 81 787 202 470 60 629
Trade and other payables 79 777 139 956 56 459
Derivative financial instruments 543 2 310 2 707
Taxation 1 454 2 211 1 454
Bank overdrafts 13 24 220 9
Loans and borrowings 33 773
Total equity and liabilities 170 995 401 452 205 332
Net asset value per share (cents) 35,7 70,5 58,2
Net asset value per share net of treasury (cents) 38,8 76,0 62,8
Condensed Consolidated Statement of Cash Flows
[for the six months ended 31 January 2013]
Unaudited Reviewed Audited
six months six months twelve months
ended ended ended
31 January 2013 31 January 2012 31 July 2012
R~000 R~000 R~000
Cash flows from operating activities 9 613 (18 800) (53 358)
Profit/(loss) before taxation 3 166 14 362 (35 100)
Adjustments not affecting the flow of funds (2 300) (2 584) 8 809
Operating income before working
capital changes 866 11 778 (26 291)
Increase/(decrease) in working capital 7 606 (27 706) (18 459)
8 472 (15 928) (44 750)
Cash generated from operations 1 141 (2 872) (8 608)
Finance income 1 854 120 228
Finance costs (41) (2 992) (6 716)
Taxation paid (672) (2 120)
Cash flows from investing activities (984) (1 440) 155 406
Cash flows from financing activities (57 407) (10 332) (44 012)
Capital reduction of shares in issue (61 580)
Own shares capital reduction by subsidiary 4 173
Loans repaid (10 332) (44 012)
(Decrease)/increase in cash equivalents (48 778) (30 572) 58 036
Foreign exchange movements
in cash balances 155 3 797 4 382
Cash and cash equivalents at beginning
of the period 89 578 27 160 27 160
Cash and cash equivalents at end
of the period 40 955 385 89 578
Condensed Consolidated Statement of Changes in Equity
[for the six months ended 31 January 2013]
Unaudited Reviewed Audited
six months six months Twelve months
ended ended ended
31 January 2013 31 January 2012 31 July 2012
R~000 R~000 R~000
Share capital 246 246 246
Share premium 57 320 118 900 118 900
Balance at beginning of the period 118 900 118 900 118 900
Capital reduction (61 580)
Treasury shares (19 163) (23 336) (23 336)
Balance at beginning of the period (23 336) (23 336) (23 336)
Own shares acquired by subsidiary 4 173
Share-based payment equity reserve 1 255 3 348 1 255
Balance at beginning of the period 1 255 3 322 3 322
Share-based payment transactions
during the period 26 26
Transfer to retained earnings (2 093)
Foreign currency translation reserve 26 (18 005) 25
Balance at beginning of the period 25 (24 561) (24 561)
Foreign exchange movements
during the period 1 6 556 24 586
Retained earnings 48 365 92 448 46 312
Balance at beginning of the period 46 312 83 614 83 614
Profit/(loss) for the period 2 053 8 834 (39 395)
Transfer to retained earnings 2 093
Equity attributable to owners
of the parent 88 049 173 601 143 402
Minority interest 11 953
Balance at beginning of the period 10 588 10 588
Recognised income for the period 125 1 301
Disposal of subsidiary (12 743)
Foreign exchange movements 1 240 854
Total capital and reserves 88 049 185 554 143 402
Commentary
General review
Security of electronic information of all types is a constant and growing concern for enterprises. SecureData is in the business
of keeping the electronic data of our clients safe, available and reliable. Appropriate products and services are supplied
by highly trained and skilled personnel. We provide products and services to almost every major corporation in South Africa,
to African businesses and governments generally, as well as providing specialised information security services in Europe
and USA.
Between May 2012 and today Securedata has undergone extensive restructuring and a major overhaul of its leadership
team. This process has now been completed and the leadership is functioning as an optimised team. With all legacy issues
resolved the team has now been able to focus on the operation and growth of the business. Group headcount has reduced
from 140 to 96. Certain products and services were discontinued, and other new ones introduced. Experienced senior
personnel were hired to strengthen the team.
After very disappointing trading results in the immediate prior six month period to 31 July 2012, the period under review has
seen a return to profitability. Group EBITDA from continuing operations increased to R0,85 million (2012: R0,28 million)
on revenues from continuing operations that increased to R138,1 million (2012: R119,5 million) reflecting an EBITDA
margin of 0,6% (2012: 0,2%) for the past six months compared to the comparable prior period. The increase in revenue is due
to focussing on the generation of new business in partnership with our channel resellers.
SecureData Africa and SensePost recorded EBITDA profits of R0,3 million and R3,2 million, respectively, for the period.
Compared to the group EBITDA loss from continuing operations of R45 million for the year ended 31 July 2012, and taking
into account the inclusion of restructuring costs in these results, this has been a remarkable six months for the group.
The increase in profits has resulted in headline earnings per share on continuing operations of 1,0 cent (2012: loss of 0,6 cents)
and adjusted earnings per share on continuing operations of 0,5 cents (2012: loss of 0,8 cents).
The net cash position of the group improved significantly, when compared to the same period ending 31 January 2012,
to R41.0 million (2012: R0,4 million) following the sale of SecureData Europe. The sale enabled the group to return excess
sale proceeds to shareholders by way of a capital reduction of 25 cents per share (R61,6 million) which was paid to
shareholders on 24 December 2012.
Technology renewal revenue is important to our business, but the focus turned to the generation of new business in
partnership with our channel resellers. This effort is starting to bear fruit and we are seeing the beginnings of some material
growth. Any growth will focus on higher margin business opportunities and will be prudently managed so not to stretch the
resources of the business.
Operational review
SecureData operates through two divisions, SecureData Africa and SensePost.
SecureData Africa
Six months to Six months to Twelve months to
31 January 31 January 31 July
2013 2012 Growth 2012
R~000 R~000 % R~000
Revenue 121 319 104 582 16,0 189 207
EBITDA 331 (1 482) 122,3 (45 897)
EBITDA margin (%) 0,3 (1,4) (24,3)
SecureData Africa has seen a turnaround with EBITDA of R0,3 million (2012: loss of R1,5 million) on revenue of R121,3 million
(2012: R104,6 million). The revenue growth of 16,0% over the prior period resulted in revenue for the six months being equal
to 64% of the revenue in the prior year to 31 July 2012. Significant growth was achieved from territories north of South Africa
which now comprises some 20% (2012: 10%) of the business.
We have seen major demand for our products and services come from the emphasis on remote device management, cloud
computing, data loss protection and intrusion detection and recovery. Our staff have been retrained to address solutions to
specific risks in enterprises. This has been well received by our end-user customers. We always approach end-user customers
in partnership with channel resellers. This has introduced transparency and certainty into the market and gives assurance
to the procurement functions of end-user customers that they are buying from competitive suppliers who fully understand
their needs.
SensePost
Six months to Six months to Twelve months to
31 January 31 January 31 July
2013 2012 Growth 2012
R~000 R~000 % R~000
Revenue 16 636 15 289 8,8 33 576
EBITDA 3 145 4 001 (21,4) 8 075
EBITDA margin (%) 18,9 26,2 24,0
SensePost remained profitable with an EBITDA of R3,1 million (2012: R4 million) on increased revenues of 8,8% compared to
the same period last year. Some major training events which generate significant revenue are not always performed during the
same period year on year and this has resulted in the lower EBITDA compared to the same period for last year. We expect
to recover this in the second half of the year.
SensePost continues to keep their clients~ data and systems safe by performing complex and skilled penetration testing,
vulnerability assessments and training. Approximately a quarter of the revenues were generated outside of South Africa, mainly
in the USA and UK. We are continuing to invest in the UK operations.
The table below summarises the group results:
Six months to Six months to Twelve months to
31 January 2013 31 January 2012 31 July 2012
Revenue EBITDA Revenue EBITDA Revenue EBITDA
R~000 R~000 R~000 R~000 R~000 R~000
SecureData Africa 121 319 331 104 582 (1 482) 189 207 (45 897)
SensePost 16 636 3 145 15 289 4 001 33 576 8 075
Head office 141 (2 631) (2 235) (7 139)
Consolidation entries (402) (554)
Continued operations 138 096 845 119 469 284 222 229 (44 961)
SecureData Europe 116 492 11 949 221 314 20 482
Head office 6 (3 122)
Consolidation entries (248) (997)
Discontinued operations 116 244 11 955 220 317 17 360
Group results 138 096 845 235 713 12 239 442 546 (27 601)
Basis of preparation
These unaudited condensed interim consolidated financial statements have been prepared in accordance with the recognition and
measurement requirements of International Financial Reporting Standards and the presentation and disclosure requirements
of IAS 34 Interim Financial Reporting, the Companies Act, 2008 (Act 71 of 2008), as amended, the SAICA Financial Reporting
Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued by the Financial
Reporting Standards Council, and with the JSE Limited Listings Requirements. The accounting policies applied in the preparation of
these unaudited condensed interim consolidated financial statements conform to the requirements of International Financial Reporting
Standards, and are consistent with those applied in the prior year.
The results have been prepared on the going concern basis under the supervision of Carlo Venter, the Financial Director and have not
been reviewed or audited by the group~s auditors.
Subsequent events
The directors are not aware of any material matter or circumstance arising since the end of the financial period under review
to the date of this report.
Directorate
Andrew Aitken resigned as director on 24 January 2013, and we would like to thank him for his contribution made to the
group over a number of years.
For and on behalf of the board
PR Pretorius MG Crisp
Chairman Chief Executive Officer
22 March 2013
SecureData Holdings Limited
Incorporated in the Republic of South Africa
(Registration number 1998/010017/06)
Share code: SDH ISIN: ZAE000096368
("SecureData" or "the group")
Directors:
PR Pretorius (Chairman), MG Crisp (Chief Executive Officer), CW Venter (Financial Director)
P Sneddon^, VJ Archer*, L Koyana*, S Midgley*, N Mthembu
Non-executive ^Lead independent non-executive *Independent non-executive
Registered office:
SecureData Holdings Limited
Nicol Main Office Park
4 Bruton Road, Bryanston, 2021
(PO Box 4673, Rivonia, 2128)
Company secretary:
Merchantec Proprietary Limited
Transfer secretaries:
Computershare Investor Services Proprietary Limited
(Registration number 2004/003647/07)
70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
Sponsor:
Merchantec Capital
www.securedataholdings.com
Date: 22/03/2013 04:45:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (~JSE~).
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