| Fri 31 May 2002, 0:00 | | Synergy Holdings Limited - Audited Results For The |
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Audited Results For The Year Ended 28 February 2002
Synergy Holdings Ltd
Audited Results
Fiscal Year Ended 28 February 2002
BALANCE SHEET
as at 28 February 2002
2002 2001
ASSETS
Non current assets 1,542,266 2,018,103
Fixed assets 1,267,603 1,819,820
Investment in subsidiaries - -
Investments 274,663 198,283
Current assets 3,389,425 2,093,152
Inventories 79,241 56,446
Accounts receivable 1,791,774 1,125,555
Bank balances 1,518,410 911,151
Total assets 4,931,691 4,111,255
EQUITY AND LIABILITIES
Capital and reserves 3,298,671 2,774,388
Issued capital 3,837,634 3,837,634
Accumulated loss -538,963 -1,063,246
Non current liabilities
Long term liabilities 113,791 111,888
Current liabilities 1,519,229 1,224,979
Accounts payable 1,253,295 726,347
Taxation 82,208 82,208
Current portion of long term liabilities 66,360 118,836
Bank overdraft 117,366 297,588
Total equity and liabilities 4,931,691 4,111,255
Number of shares in issue 62,562,000 62,562,000
Net asset value per share (cents) 5.27 4.43
Net tangible value per share (cents) 5.27 4.43
INCOME STATEMENT
for year ended
28 February 2002
2002 2001
Gross revenue 12,305,343 9,615,062
Cost of sales 3,082,871 3,196,137
Gross profit 9,222,472 6,418,925
Operating costs 8,758,060 9,982,606
Operating profit/(loss) 464,412 -3,563,681
Investment income 82,485 67,109
Finance costs -22,614 -173,206
Profit/(loss) Before Taxation 524,283 -3,669,778
Taxation - -
Profit /(Loss) for the Year 524 283 -3 669 778
Earnings per share (cents) 0.84 -5.87
Headline earnings per share (cents) 0.81 -3.07
STATEMENT
OF
CHANGES IN EQUITY
for year ended 28 February 2002
Share Share Accumulated Total
capital premium profit
R R R R
Balance at 01
March 2000 100 - 2,606,532 2,606,632
Net loss for the year -3,669,778 -3,669,778
Issue of share capital 625,520 19,184,991 19,810,511
Write off of goodwill - -15,972,977 -15,972,977
Balance at
01 March 2001 625,620 3,212,014 -1,063,246 2,774,388
Net profit for
the year 524,283 524,283
Balance at 28
February 2002 625,620 3,212,014 -538,963 3,298,671
CASH FLOW STATEMENT
for the year ended
28 February 2002
2002 2001
Cash flows from operating activities 801,553 1,902,338
Cash flows from investing activities 36,501 476,888
Cash flows from financing activities -50,573 -1,157,860
Increase in cash and cash equivalents 787,481 1,221,366
Cash and cash equivalents at beginning
of the year 613,563 -607,803
Cash and cash equivalents at end of the year 1,401,044 613,563
Accounting Policies
The financial statements of the Group comply in all material effects with
South African Statements of Generally Accepted Accounting Practice and are
consistent with those applied in the previous financial year.
Review of Results
Company Overview
Synergy Holdings owns the entire share capital of Prime Support. Prime
Support offers software products and services to the Johannesburg SMME
market through two divisions; namely Synergy Accounting and Synergy
Networking.
Synergy Accounting focuses primarily on the installation and ongoing support
of the Accpac International accounting product range and services more than
500 companies in Johannesburg that have Accpac installed. Synergy Accounting
also services clients running Softlines' Pastel Accounting product range,
and currently supports approximately 450 clients in this market. These
markets do not overlap as Accpac is targeted towards the higher end of the
SMME market. Currently and for the foreseeable future, it is expected that
Accpac will contribute the lions share of the revenue.
Synergy Networking provides networking products and services to the
abovementioned base of clients.
Prime support has a third division, Appsoft, which is dedicated to software
development. Appsoft focuses on custom and add-on development around the
Accpac product range, complimenting the services offered by Synergy
Accounting.
Financial Comment
The 2001 headline loss of 3.07 cents per share has been turned around and a
small profit, of 0.81 cents per share has been achieved. During the Year
under review:-
* Turnover increased by 28% (R 2 690 281.00).
* Gross Margins increased by 44% (R 2 803 547.00)
* Operating costs decreased by 12% (R1 224 546.00)
* Net Interest Income was R 59 871.00 versus the expense of R 106 097.00
of the previous year.
* Cash balances increased by R 787 481.00
We are satisfied with what has been achieved this year, particularly given
the relatively flat market conditions.
Prospects
The key to turning the business around has been to focus on what we do best.
We expect to continue to narrow our focus and add value to our existing
offering.
In the past we did not apply adequate focus to the networking side of the
business. This year Synergy Networking was established as a formal division.
A maintenance offering was created,( specifically tailored to the
requirements of our Accpac clients), but was not actively marketed to the
client base. Despite this offering still being in prototype stage,
maintenance billings are in excess of R 60 000.00 per month. We expect this
product to be stabilised and hope for a positive response from the client
base.
The rate of client acquisition on the Pastel side of Synergy Accounting has
been dramatic. We have acquired more than 250 clients in the last year.
Despite the marginal return from each of these clients being quite small, we
expect an increasing contribution from this area of the business in the
future.
The Appsoft Division is still trading at a loss with a burn rate of
approximately R 50 000.00 per month. In January however the last of the
"blue sky" developments was abandoned. With the resource being committed and
focused on a complimentary market, we would like the business to be breaking
even within the first 9 months of the year. If this does not occur it will
be restructured to the point that it does not contribute negatively.
For and on behalf of the board
Patrick Toolan
Registered Office : 128-4th Street
Linden
2195
Transfer Secretaries : Computershare Services Limited
P.O. Box 62391
Marshalltown
2107
Telephone : 011 370-7870 Fax : 011 370-7916
Directors : P.J Toolan
N.J. Plane
T. James
