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CS COMPUTER SERVICES HOLDINGS LIMITED -
CS Computer Services Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1996/015131/06)
Share code: CSH ISIN code: ZAE 000022034
("CS Holdings" or "the company")
TRADING UPDATE AND CAUTIONARY ANNOUNCEMENT
In a trading update issued on 30 May 2003, CS Holdings reported
that, as a result of a number of external factors, sales during the
third quarter were considerably slower than expected, although the
company has taken a conscious decision to preserve its intellectual
assets and IT skills base, and therefore its operating cost, to
protect its competitive advantage over the long term. Shareholders
were advised that:
* the aforementioned delays and conditions resulted in a considerable
attributable loss for the third quarter of the financial year, though
management expected the fourth quarter to be profitable;
* management expected the company to be profitable for the full
financial year ended 30 June 2003, before the amortisation of
goodwill, although headline earnings per share for that period was
expected to be substantially lower than the corresponding prior
period.
TRADING UPDATE
CS Holdings" earnings for the year ended 30 June 2003 will be
substantially lower than previously anticipated. Management expects
an attributable loss of approximately R15 million after tax (before
the amortisation of goodwill and impairment of assets), and a
headline loss of approximately 6,5 cents per share for that period.
The primary reasons for the loss are:
* the cancellation of the sale of the rights to a software product
that was entered into during the first six months of the financial
year under review. This will have a negative impact on earnings of
roughly R10,5 million after tax. CS Holdings remains entitled to the
underlying revenue stream from the use of this software product by
its clients, and income derived from the use of this product will be
accounted for in the relevant future periods;
* various other matters, including impairment of certain assets and
debtors, higher interest charges and the effect of the application of
AC133; and,
* a less than expected positive impact from new committed orders in
the fourth quarter.
Despite the current set-back resulting from the issues listed
above and their impact on the company"s results for the year,
management is positive regarding CS Holdings" prospects and trading
performance for the next financial year.
CAUTIONARY ANNOUNCEMENT
Shareholders are advised that the forecast financial information
has not been reviewed and reported on to the JSE Securities Exchange
South Africa by the company"s auditors as the company"s financial
results for the year ended 30 June 2003 are in the process of being
audited.
Shareholders must therefore exercise caution in dealing in the
company"s securities until the publication of the financial results
for the year ended 30 June 2003, which results announcement is
expected to be early September 2003.
Johannesburg
21 August 2003
SPONSORS
Gensec Bank Limited Corporate Finance Advisory
Barnard Jacobs Mellet Corporate Finance (Pty) Limited
Date: 21/08/2003 05:13:32 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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