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Vesta Technology Holdings Limited - Reviewed Provisional Results For The Year
Release Date: 29/11/2002 08:18:06 Code(s): VST
Vesta Technology Holdings Limited - Reviewed provisional Results for the year
ended 31 August 2002
Vesta Technology Holdings Limited
(Registration number: 1998/015580/06)
(Share code: VST)
(ISIN code: ZAE000016267)
Reviewed provisional Results for the year ended 31 August 2002
Condensed income statement
Unaudited Unaudited Unaudited Audited
Six months Six months Year Year
ending ending ending ending
28/2/02 31/8/02 31/8/02 31/8/01
R`000 R`000 R`000 R`000
Revenue 8 555 10 046 18 601 31 522
Cost of sales (2 566) (4 017) (6 583) (5 600)
Gross profit 5 989 6 029 12 018 25 922
Other operating income 185 134 319 249
Other operating expenses (8 539) (8 204) (16 743) (25 852)
Results from operating (2 365) (2 041) (4 406) 319
activities
Loans written off (3 537)
Loss from discontinued (9 645)
operations
Loss from cancellation of (4 185)
contracts
Improvement of intangible (14 189) (14 189)
assets
Net financing expense (236) (166) (402) (116)
Loss before taxation (2 601) (16 396) (18 997) (17 164)
Income tax 594 881 1 475 7
Loss for the period (2 007) (15 515) (17 522) (17 157)
Reconciliation of headline
loss
Loss (2 007) (15 515) (17 522) (17 157)
Goodwill effects 498 12 461 12 959 1 747
Loss from discontinued 9 645
operations
Loans written off 3 537
Loss on cancellation of 4 185
contracts
Fund Mator operating (2 652)
profits consolidated
Headline loss (1 509) (3 054) (4 563) (695)
Loss per share (cents) (2,4) (18,3) (20,7) (20,3)
Headline loss per share (1,8) (3,6) (5,4) (0,8)
(cents)
Weighted average number of 84 600 84 600 84 600 84 600
shares (million)
Condensed statement of changes of equity
Non-
distribu-
Share Share Retained table
capital premium profits reserve Total
R`000 R`000 R`000 R`000 R`000
Balance at 1 85 19 381 17 664 77 37 207
September 2000
Shares not issued (423) (423)
Foreign exchange 340 340
translation
reserve
Post acquisition (112) 112
non distributable
reserve
Net loss for the (17 157) (17 157)
year
Balance at 31 85 18 958 395 529 19 967
August 2001
Balance at 1 85 18 958 395 529 19 967
September 2001
Foreign exchange 542 542
translation
reserve
Net loss for the (17 522) (17 522)
period
Balance at 31 85 18 958 (17 127) 1 071 2 987
August 2002
Condensed balance sheet
Unaudited Audited
31/8/02 31/8/01
R`000 R`000
Assets
Non-current assets 4 822 19 854
Tangible assets 492 935
Non-tangible assets 2 311 18 375
Deferred tax 1 956 481
Other financial assets 63 63
Current assets 2 207 8 279
Inventories 167 110
Trade and other receivables 1 723 7 502
Cash and cash equivalents 47 433
Other financial assets 270 234
Total assets 7 029 28 133
Equity and liabilities
Capital and reserves 2 987 19 967
Equity capital 19 043 19 043
Non-distributable reserves 1 071 529
Accumulated profits/(loss) (17 127) 395
Non-current liabilities 164 374
Interest bearing borrowings 56 158
Other financial liabilities 108 216
Current liabilities 3 878 7 792
Trade and other payables 3 562 4 681
Short-term borrowings 316 3 111
Total equity and liabilities 7 029 28 133
Cash flow statement
Unaudited Audited
Year Year
ending ending
31/8/02 31/8/01
R`000 R`000
Cash flows from operating 2 435 (4 723)
activities
Cash flows from investment (430) (2 033)
activities
Cash flows from financing (176) 164
activities
Foreign exchange translation 542
activities
Net change in cash and cash (2 371) (6 592)
equivalents
Cash and cash equivalents (269)
acquisitions
Cash and cash equivalents at (2 538) 4 323
beginning of period
Cash and cash equivalents at (167) (2 538)
end of period
Commentary
The Business
Vesta`s core business competency is the delivery of total information technology
("IT") services. Over the last few years Vesta invested in a multi-disciplined
development team and products that are able to perform in the demand of a fast
changing environment. Vesta delivers these skills to the marketplace in four
main areas, Software Development, Service and Support, Training and Own
Products, which are positioned in the areas of e-learning, performance
management and collaboration.
Accounting policies
The accounting policies in respect of the financial year ended 31 August 2002
were also consistently applied to the results for the period ended 31 August
2001. These policies conform to the South African Statements of Generally
Accepted Accounting Practice.
Review of results
The financial statements have been presented in accordance with the South
African Statements of Generally Accepted Accounting Practice (GAAP) and have
been reviewed by the Company`s auditors, DBL Financial Services Inc. Their
report is available for inspection at the registered office. The provisional
results are not audited, as the final audit has not yet been completed.
The results of the previous year were impacted by various factors. The severe
trading conditions, with markets being very cautious with IT spend, impacted the
group. In this period management also embarked on a restructuring process to
ensure a focused and flexible team, with lower operating costs. The Group also
suffered from the weakening of the Rand which led to a devaluation of loans to
the value of R511 972.
During the year under review the directors evaluated the value of the intangible
assets of the group and impaired the goodwill and capitalised development costs
with R11 962 080 and R2 226 674 respectively.
The results of the previous year have been restated due to the fact that the
balance of deferred tax was overstated with R353 526. This resulted in restated
loss per share of 20,3 cents and headline loss per share of 0,8 cents, the loss
per share and headline loss per share as previously stated were 19,9 cents and
0,4 cents respectively.
Operational comment
The rationalisation process Vesta embarked on resulted in a more focused group.
The different areas within the group are responding well to the changes and the
group is in a positive operational position.
This has resulted in revenue growth of 17,4%, savings on staff costs of 20% and
savings of 17% on normal operating expenses in the past six months, compared to
the first six months.
Future
Vesta has streamlined each main operational area and has defined marketing
strategies, which are aimed at optimizing opportunities and expanding the
markets for the Group. This process is aimed at ensuring sustainable long-term
growth and annuity revenue streams within each operational area of the Group.
With the cost cutting exercise and the focus on expansion of existing
operational areas, the Group intends returning to profitable operations in the
next twelve months.
By order of the Board
Frederick Morrison Johannesburg
Group Chief Executive 29 November 2002
Directors: F Morrison, E Thomas, A Futcher, M Morrison (Non-executive)
Transfer Secretaries: Computershare Investor Services Limited, 70 Marshall
Street, Johannesburg 2001.
Registered Office: Vesta House, Gazelle Close, Corporate Park, Old Pretoria Rd,
Midrand, Johannesburg.
Tel: (011) 314-8181 Fax: (011) 314-8182 www:vesta.co.za
Date: 29/11/2002 08:18:00 AM Produced by the JSE SENS Department
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