| Wed 8 May 2002, 0:00 | | Bytes Technology Group Limited - Audited Financial |
|
ended 28 February 2002
Bytes Technology Group
IT Services for the enterprise
Bytes Technology Group Limited
(Registration number 1911/003874/06)
(Incorporated in the Republic of South Africa)
Share code: BTG ISIN: ZAE 000029526
- Headline earnings per share of 40 cents
- Revenue up 16%
- Operating profits up 85%
- Dividends of 12 CPS
Audited financial results for the year ended 28 February 2002
Income statement
Year ended Year ended Year ended
28-Feb 28-Feb 28-Feb
2002 2001 2001
Figures in R000 (Audited) (Proforma) (Audited)
Revenue 2 341 498 2 010 029 763 271
Continuing operations 2 328 923 1 970 149 723 391
Discontinuing operations 12 575 39 880 39 880
Operating profit/(loss) 109 889 30 308 (59 017)
Continuing operations 116 647 63 195 (26 130)
Discontinuing operations (6 758) (32 887) (32 887)
Net interest received/(paid) 1 309 (6 313) (10 034)
Equity accounted income 840 (11 886) (11 886)
Profit/(loss) before goodwill
amortisation
and exceptional items 112 038 12 109 (80 937)
Goodwill amortisation (67 198) (12 678) (12 678)
Exceptional items 14 881 (18 650) (20 379)
Profit/(loss) before taxation 59 721 (19 219) (113 994)
Normal taxation (25 574) (18 183) (1 613)
Deferred tax asset raised 34 766 - -
Profit/(loss) after taxation 68 913 (37 402) (115 607)
Attributable to outside shareholders (25 737) (18 961) 8 277
Attributable to ordinary shareholders 43 176 (56 363) (107 330)
Weighted number of shares in issue 150 733 124 507 45 214
(thousands)
Earnings/(loss) per share - Basic 28.64 (45.27) (237.38)
(cents)
Headline earnings/(loss) per share 63.39 (16.39) (155.95)
(cents)
Adjusted headline earnings/(loss) per
share
(cents) 40.33 (16.39) (155.95)
Notes:
1. Proforma results
The pro-forma results are based on the assumption
that the actual results of the operations acquired
from Fintech had been consolidated into BTG
for the year to February 2001.
2. Exceptional items
Asset impairment provisions 8 071 (8 736) (8 736)
reversed/(raised)
Share of associate's exceptional items 2 953 - -
Vendor liability raised - (2 775) (2 775)
Profit on disposal of businesses 6 337 1 023 -706
Impairment of goodwill (2 480) (8 162) (8 162)
14 881 (18 650) (20 379)
3. Headline earnings
Attributable earnings is
reconciled to headline
earnings as follows:
Attributable earnings/(loss) 43 176 (56 363) (107 330)
Goodwill amortised 67 198 12 678 12 678
(Profit)/loss on disposal of fixed (4) 3 761 3 761
assets
Exceptional items (14 881) 18 650 20 379
Outside shareholders' portion of
exceptional
items 61 865 -
Headline earnings/(loss) 95 550 (20 409) (70 512)
Deferred tax asset raised (34 766) - -
Adjusted headline earnings/(loss) 60 784 (20 409) (70 512)
4. The accounting policies and methods of computation followed in this
preliminary report are consistent with the annual financial statements for
the year ended 28 February 2001. The preliminary report has been prepared in
accordance with Statements of Generally Accepted Accounting Practice.
5. Diluted earnings per share and diluted headline earnings per share are
not materially different from basic earnings per share and headline earnings
per share respectively.
Balance sheet
28-Feb 28-Feb
2002 2001
Figures in R000 (Audited) (Audited)
ASSETS
Non-current assets 529 343 517 775
Fixed assets 105 061 103 400
Investments & loans 33 722 34 190
Goodwill 222 498 259 215
Finance lease assets 100 447 89 850
Deferred taxation 67 615 31 120
Current assets 902 497 677 147
Inventory 177 392 147 536
Accounts receivable 503 371 383 275
Bank & cash 221 734 146 336
TOTAL ASSETS 1 431 840 1 194 922
Ordinary shareholders' equity 498 793 452 430
Outside shareholders' interest 87 978 70 990
Long-term liabilities 76 142 27 071
Finance lease liabilities 100 447 89 850
Current liabilities 668 480 554 581
TOTAL EQUITY & LIABILITIES 1 431 840 1 194 922
Shares in issue at end of period (thousands) 151 336 150 276
Net asset value per share (cents) 329.59 301.07
Abridged cash flow statement
Year ended Year ended
28-Feb 28-Feb
2002 2001
Figures in R000 (Audited) (Audited)
Operating activities 81 993 (18 961)
Cash generated by/(utilised in) operations 145 227 (32 601)
Changes in working capital (18 297) 28 943
Net interest received/(paid) 1 309 (10 034)
Taxation paid (46 246) (5 267)
Cash generated by/(utilised in) operating 81 993 (18 959)
activities
Dividend paid - (2)
Net investing activities (61 407) 36 980
Financing activities 54 812 231 643
Net funds generated 75 398 249 662
Cash and cash equivalents
- at beginning of period 146 336 (103 326)
- at end of period 221 734 146 336
Abridged statement of changes in equity
28-Feb 28-Feb
2002 2001
Figures in R000 (Audited) (Audited)
Balance at beginning of year 452 430 (43 860)
Attributable to shareholders 43 176 (107 330)
Issue of shares 3 610 613 590
Rights offer costs - (6 708)
Share liability reversed 1 728 -
Foreign currency translation reserve (2 151) (3 262)
Balance at end of year 498 793 452 430
Abridged segmental analysis
Year Year Year
ended ended ended
28-Feb 28-Feb 28-Feb
2002 2001 2001
Figures in R000 (Audited) (Proforma) (Audited)
Revenue
Software Products & Solutions 107 625 101 172 101 172
Managed Networking Services 196 875 162 478 162 478
Enterprise Solutions (UK) 650 209 459 741 459 741
Digital Healthcare Solutions 32 402 17 552 17 552
Enterprise Wide Information
Products & Services 400 367 398 208 -
Business Communication Solutions 156 637 144 926 -
Document Management Services 817 210 703 624 -
Total continuing operations 2 361 325 1 987 701 740 943
Discontinuing operations 12 575 39 880 39 880
Total all operations 2 373 900 2 027 581 780 823
Less equity accounted operations (32 402) (17 552) (17 552)
2 341 498 2 010 029 763 271
Operating profit/(loss)
Software Products & Solutions (3 517) (15 687) (15 687)
Managed Networking Services (464) (18 798) (18 798)
Enterprise Solutions (UK) 24 973 6 930 6 930
Digital Healthcare Solutions 840 (10 922) (10 922)
Enterprise Wide Information
Products & Services 18 852 12 187 -
Business Communication Solutions 6 301 4 926 -
Document Management Services 75 863 72 212 -
Other (5 361) 461 461
Total continuing operations 117 487 51 309 (38 016)
Discontinuing operations (6 758) (32 887) (32 887)
Total all operations 110 729 18 422 (70 903)
Less equity accounted operations (840) 11 886 11 886
109 889 30 308 (59 017)
Supplementary information
Year ended Year ended
28-Feb 28-Feb
2002 2001
Figures in R000 (Audited) (Audited)
Capital commitments - 1 272
Capital expenditure 99 467 8 800
Contingent liabilities 152 565 43 944
Depreciation 36 064 24 595
Message to stakeholders
GENERAL
Despite a year during which trading conditions remained challenging, your
directors are pleased to report that the results for Bytes Technology Group
("BTG") for the year ended 28 February 2002 have met their expectations in
virtually all respects. The benefits which were predicted to emanate from
the significant restructuring undertaken during the previous 12 months were
realised and moreover will continue to contribute positively during the
coming year. It is particularly satisfying to note that the merger of the
acquired businesses from Fintech with the original operations of the group
has been achieved without undue disruption; again the synergistic benefits
of this achievement, together with gains in market share, will continue to
add value to our group during the coming year and beyond.
FINANCIAL RESULTS
In order to provide a meaningful assessment of the progress achieved during
the financial year to end February 2002, a comparison of the current year
with both actual and pro-forma results for the previous year are shown. The
pro-forma results are based on the assumption that the actual results of the
operations acquired from Fintech had been consolidated into BTG for the year
to February 2001. Accordingly, on a like for like basis, it is gratifying to
report an increase in revenues of 16.5% from R2,0 billion to R2,34 billion.
Operating profit rose from R30,3 million to R109,9 million. Similarly,
operating profits derived from continuing operations recorded an increase of
85% from R63,2 million to R116,6 million. Profit before exceptionals and
goodwill amortisation rose from R12,1 million to R112,0 million. Adjusted
headline earnings (excluding the benefits of raising a deferred tax asset)
rose by over R81 million from a loss of R20,4 million to a profit of R60,8
million. This translated into a headline earnings per share of 40,3 cents
compared with a prior year pro-forma loss of 16,4 cents and an actual loss
of 156 cents.
It is notable that 28% of revenue and 21% of operating profit from
continuing operations was, generated by the group's offshore operations, up
from 23% and 14% respectively a year earlier.
Cash performance for the year was satisfactory with positive balances of
approximately R220 million being recorded at 28 February 2002 compared with
R146 million a year earlier. This improvement was achieved after incurring
expenditure of some R60 million on acquisitions during the year.
OPERATIONAL PROGRESS
Again it is pleasing to report that substantial improvements were achieved
in virtually all operational areas. Of particular note were the improved
results posted by both our networking and software businesses which had
incurred significant losses during the previous year. The attainment of
profitability, albeit small, by our healthcare operations (Digital
Healthcare Solutions) during its first year as a restructured operation was
noteworthy. The most significant improvement was registered by our United
Kingdom operation which increased operating profits from R7 million to R25
million ( 0,7 million to 2,0 million). The improvements achieved by our NDS
and Alcatel businesses were also most welcome. Xerox produced yet another
solid performance in a difficult market. The acquisition from Xerox UK of
the sole distribution rights for their product in most of sub-Saharan Africa
contributed to increased profitability. The acquisition of rights to
additional territories are currently being negotiated.
During the year disposals of operations which had incurred aggregate losses
of almost R7 million were effected. Taking all factors into account,
therefore, we enter the new financial year with a reasonably high level of
operational confidence.
FUTURE PLANS
As advised in a recent cautionary BTG is at an advanced stage of
negotiations to acquire 100% of a broad-based UK IT services company. Should
the acquisition be concluded it is envisaged that the business will
contribute meaningfully to profit growth during the next few years and will
form an integral part of our offshore expansion strategy.
Additionally your directors are considering the acquisition from the Altron
group of a business which offers leasing finance for products and services
supplied by BTG. It is anticipated that a proposal will be put before
shareholders in the near future.
The group continues to implement various major empowerment initiatives to
facilitate appropriate skills transfers and business expansion.
Prospects
Given the various opportunities currently available to the group, coupled
with the solid improvements achieved during the past year in the group's
core operations, your directors enter the 2002/3 financial year with
confidence that a satisfactory increase in earnings will be achieved.
The forward plans which are in place may necessitate a review of BTG's
capital structure and various alternatives are being considered in
conjunction with our corporate advisors.
Declaration Of Dividend
Notice is hereby given that a dividend of 12 (twelve) cents per ordinary
share of no par value, payable in the currency of the Republic of South
Africa, has been declared payable to all shareholders of BTG recorded as
such in the register of the company at the close of business on Friday
31 May 2002.
Trading in the STRATE environment requires settlement within five business
days and, in accordance with STRATE's settlement procedures, the following
dates will apply to the dividend:
2002
Last date to trade ordinary shares "cum" dividend Friday 24 May
Ordinary shares trade "ex" dividend Monday 27 May
Record date Friday 31 May
Payment date Monday 3 June
Dividend cheques in payment of this dividend to certificated shareholders
will be posted to shareholders on or about Monday 3 June 2002. Electronic
payment to certificated shareholders will be undertaken simultaneously.
Shareholders who have dematerialised their share certificates will have
their bank accounts, which are linked to their safe custody accounts,
credited on Monday 3 June 2002.
In the case of certificated shareholders, notice of any change of address of
shareholders must reach the transfer secretaries, Computershare Investor
Services Limited, on or before Friday 24 May 2002.
Share certificates may not be dematerialised and/or rematerialised between
Monday, 20 May 2002 and Friday, 31 May 2002, both days inclusive.
ANNUAL REPORT
The Annual Report and financial statements for the year to 28 February 2002
will be posted to shareholders during June 2002.
On behalf of the Board
David Redshaw Peter Riskowitz
Chairman Group Financial Director
9 May 2002
This report is available on the company website at www.btgroup.co.za.
