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Insure - Reviewed Interim Results for the six months ended 31 August 2002
INSURANCE OUTSOURCING MANAGERS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1998/013121/06)
("INSURE" or "the company")
JSE Code: INS ISIN Code: ZAE 000033221
REVIEWED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2002
Consolidated income statements
The reviewed interim results for the INSURE group for the six months ended 31
August 2002, the interim results for the six months ended 31 August 2001 and the
audited results for the year ended 28 February 2002 are presented below.
Reviewed Reviewed Audited
interim interim results
results for results for for the
the the year ended
six months six months 28 February
ended ended 2002 R`000
31 August 2002 31 August 2001
R`000 R`000
Gross collections 557 341 224 263 525 961
Revenue 8 645 15 069 32 374
Operating income before
amortisation
and taxation
Ongoing operations 316 1 778 3 393
Discontinued operations (237) (619) (1 089)
Net interest received / 217 (2 553) (4 618)
(paid)
Net income / (loss) 296 (1 394) (2 314)
before amortisation
Amortisation of goodwill - (562) (413)
& intangibles
Exceptional items - - (6 640)
Net income / (loss) 296 (1 956) (9 367)
before taxation
Taxation 279 252 39
Net income / (loss) 575 (1 704) (9 328)
after taxation
Outside shareholders - (293) (460)
interest
Attributable income /
(loss) 575 (1 997) (9 788)
retained for the period
Determination of
headline earnings /
(loss)
Attributable income / 575 (1 997) (9 788)
(loss)
Add back: Amortisation 562 8 190
Deduct: Outside
shareholders share of - (43) (239)
amortisation
Loss / (profit) on
disposal of assets - 5 (43)
Headline earnings / 575 (1 473) (1 880)
(loss)
Earnings per share
Shares in issue (000`s) 111 092 111 092 111 092
Fully diluted shares in 111 092 122 201 122 201
issue (000`s)
Earnings / (loss) per 0.5 (1.8) (8.8)
share (cents)
Headline earnings / 0.5 (1.3) (2.5)
(loss) per share (cents)
Fully diluted earnings /
(loss) per share (cents) 0.5 (1.6) (8.0)
Fully diluted headline
earnings / (loss) per 0.5 (1.2) (2.2)
share (cents)
Consolidated balance sheets
Reviewed Reviewed Audited
interim interim As As at
As at at 28
31 August 31 August February
2002 2001 2002
R`000 R`000 R`000
ASSETS
Non-current assets 18 834 37 541 17 557
Property, plant and 15 714 14 238 14 448
equipment
Intangible assets - 20 761 -
Deferred taxation 3 120 2 542 3 109
Current assets 64 787 68 636 66 728
Accounts receivable 57 797 72 759 70 387
Less: unearned finance (3 857) (4 710) (3 965)
charges
Cash resources 10 847 587 306
Total assets 83 621 106 177 84 285
EQUITY AND LIABILITIES
Capital and reserves 16 071 23 287 15 496
Issued capital 53 654 53 654 53 654
Non-distributable reserves 2 810 1 423 2 848
Distributable reserves (40 393) (31 790) (41 006)
Outside shareholders - (364) -
interest
Non current liabilities 273 1 054 899
Long term liabilities & 273 1 054 899
shareholder loan
Current liabilities 67 277 82 200 67 890
Accounts payable 65 867 45 392 59 069
Taxation - 850 268
Current portion of long - 57 -
term liabilities
Bank overdrafts 1 410 33 565 8 553
Total equity and 83 621 106 177 84 285
liabilities
Net asset value per share 14.5 20.9 13.9
(cents)
Tangible net asset value 14.5 2.3 13.9
per share (cents)
Fully diluted net asset 14.5 19.0 12.7
value per share (cents)
Consolidated statement of changes in equity
Share Share Accumula Non
Capit Premiu ted distributa Total
al m Loss ble R`000
R`000 R`000 R`000 Reserve
R`000
Balance at 01 March 11 53 643 (41 006) 2 848 15 496
2002
Profit for the six
month period
Ongoing operations 575 - 575
Revaluation 38 (38) -
depreciation
Balance at 31 August 11 53 643 (40 393) 2 810 16 071
2002
Consolidated cash flow statement
Reviewed Audited
Six Twelve
Months Months
31 28
August February
2002 2002
R`000 R`000
Cash flow generated by operating 14 846 38 188
activities
Cash flow used in investing activities (2 200) (6 180)
Cash flow generated / (used in) by
financing activities 5 038 (5 529)
Cash and cash equivalents - beginning of (8 247) (34 726)
year
Cash and cash equivalents - end of year
9 437 (8 247)
Segmental Analysis
A segmental analysis for the six months ended 31 August 2002 and for the year
ended 28 February 2002 is set out below.
Reviewed Audited
Six Months Twelve Months
31 August 28 February
2002 2002
% R`000 % R`000
Revenue
Interest earned 66% 5 747 33% 10 801
Commissions received - - 53% 17 177
Fees charged 34% 2 898 14% 4 365
Revenue as reported 100% 8 645 100% 32 373
Accounting policies
This report has been prepared in accordance with South African Statements of
Generally Accepted Accounting Practice. The accounting policies and methods of
measurement are consistent with those applied in previously reported financial
statements, and have been consistently applied throughout the period under
review. The Group`s auditors, Compendium Inc., have reviewed the financial
information in terms of Rule 3.23 of the listing requirements of the JSE. Their
unqualified review opinion is available for inspection at INSURE`s offices.
COMMENTS
Overview
In the interim period, INSURE`s strategy of becoming the preferred independent
outsource financial services provider to the short-term insurance industry and
its increasing focus on its core objectives and termination of loss making
operations, resulted in a sound foundation for further efficiencies and
profitability.
The investment in infrastructure and human capital are now beginning to show
returns, with increasing organic growth and enhanced service levels. INSURE`s
symbiotic and synergistic products, through its integrated services, have
resulted in substantial growth of gross collections and outsource
administration. INSURE continues to be recognised as a leader in short-term
insurance premium collections, financing and outsource administration.
For the period under review, total revenue decreased as a result of the
divestment from two of the Group`s non-core subsidiaries. Comparing the
segmental analysis revenue, excluding the income from the divested subsidiaries,
an increase was achieved. Reduced banking facilities adversely affected INSURE`s
growth opportunities during this period. Despite the limitation placed on the
business by the reduced facilities, the Group showed a R2.1 million turnaround -
from a R1.5 million headline loss August 2001 to a R0.6 million headline profit.
For the balance of this financial year, increased facilities have been secured
which will assist in expanding the business.
Prospects
INSURE remains focused on its strategic objectives and will continue the drive
to grow organically in all areas of the business. Various core opportunities
have been identified and are being evaluated.
Change in control
Subsequent to 31 August 2002 and as announced on 17 September 2002, a change of
control occurred by way of a Management Buy-out. Further information in this
regard will be announced in due course.
Dividend
No dividend has been declared for the interim period.
For and on behalf of the Board
D.G Eriksson D. M. Burns
Chairman Managing Director
10 October 2002
Directors
D.G. Eriksson* (Chairman), D.M. Burns (Managing)(British), C.J.P. Cilliers
(Financial), B.B. Dunn* (Alternate A.J. Dunn)
(* Non-Executive)
Secretary and registered office
Mr. J. Vogelzang, 6 St Giles Street, Randburg, 2125.
Transfer secretaries
Computershare Investor Services Limited, 8th Floor, 11 Diagonal Street,
Johannesburg.
Postal address and E-mail
P.O. Box 2867, Randburg, 2125
and
"results2003@ioh.co.za"
Sponsoring Broker
Arcay Group Limited
Date: 09/10/2002 04:45:00 PM Produced by the JSE SENS Department
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