| Wed 17 Sep 2003, 17:04 | | REVIEWED FINANCIAL RESULTS FOR THE YEAR ENDED 31 |
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ERP.COM HOLDINGS LIMITED - REVIEWED FINANCIAL RESULTS FOR THE YEAR ENDED 31 JULY
2003
ERP.com Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1998/010017/06)
("ERP.com" or "the Group")
www.erpcom.co.za
REVIEWED FINANCIAL RESULTS FOR THE YEAR ENDED 31 JULY 2003
Financial highlights
Revenue up 25%
Net profit for the year up 64%
Headline earnings per share up 60%
Cash equivalents up 120%
Dividends per share up 5 cents
Condensed income statement
2003 2002 Percentage
R"000 R"000 change
Revenue 130 728 104 453 25
Profit before taxation 27 478 16 840 63
after taking into account
the following items:
Net interest received 4 717 1 351
(Loss)/profit on disposal of
assets (135) 15
Depreciation (1 993) (2 227)
Taxation 8 429 5 195 62
Current 8 671 5 957
Deferred (534) (762)
STC 292 -
Net profit for the year 19 049 11 645 64
Goodwill amortised (371) (477)
Net income for the year attributable
to shareholders 18 678 11 168 67
-
Weighted number of shares on
which earnings per share is
based ("000) 166 420 161 735
Earnings per share (cents) 11,2 6,9 62
Headline earnings per share
(cents) 11,5 7,2 60
Dividends per share (cents) 5,0 1,4 257
Net asset value per share
(cents) 26,8 17,7 51
Condensed balance sheet
2003 2002
R"000 R"000
ASSETS
Non-current assets 4 653 5 820
Equipment 2 439 3 772
Goodwill 419 787
Deferred taxation 1 795 1 261
Current assets 74 095 43 834
Inventories and contracts in progress 68 604
Trade and other receivables 15 379 16 563
Cash and cash equivalents 58 648 26 667
Total assets 78 748 49 654
EQUITY AND LIABILITIES
Capital and reserves 45 073 28 877
Share capital and premium 8 918 9 065
Retained income 36 155 19 812
Current liabilities 33 675 20 777
Total equity and liabilities 78 748 49 654
Condensed cash flow statement
2003 2002
R"000 R"000
Cash flows from operating activities 35 528 19 028
Profit before taxation 27 478 16 840
Adjustments including those not affecting
the flow of funds (2 323) 1 617
Operating income before working capital
changes 25 155 18 457
Increase in working capital 14 924 7 823
Cash generated from operations 40 079 26 280
Net interest received 4 717 1 351
Taxation paid (9 268) (8 603)
Cash flows from investing activities (1 066) (2 206)
Cash flows from financing activities (2 481) 310
Proceeds from issue of shares 325 318
Share issue expenses (135) (8)
Own shares acquired by subsidiary (336) -
Dividends paid (2 335) -
Net increase in cash and cash equivalents 31 981 17 132
Cash and cash equivalents at beginning
of year 26 667 9 535
Cash and cash equivalents at end of year 58 648 26 667
Condensed statement of changes in equity
2003 2002
R"000 R"000
Share capital 168 164
Balance at beginning of year 164 161
Issued during the year 5 3
Own shares acquired by subsidiary (1) -
Share premium 8 750 8 901
Balance at beginning of year 8 901 8 594
Issued during the year 320 315
Share issue expenses written off (135) (8)
Own shares acquired by subsidiary (336) -
Retained income 36 155 19 812
Balance at beginning of year 19 812 8 644
Net income for the year 18 678 11 168
Dividend declared (2 335) -
Total capital and reserves 45 073 28 877
Reconciliation between earnings and headline earnings
2003 2002
R"000 R"000
Net income for the year attributable to
shareholders 18 678 11 168
(Loss)/profit on disposal of assets 135 (15)
Goodwill amortised 371 477
Headline earnings 19 184 11 630
Comments
The directors are delighted with the exceptional performance of the Group, in
its maiden year on the Main Board of the JSE Securities Exchange South Africa,
which exceeded it"s key objectives of:
- Maintaining historical earnings growth
- Maintaining high operating margins
- Increasing cash resources
During the period under review:
- Headline earnings per share increased by 60% to 11,5 cents per share
- Operating margins increased from 14,8% to 17,4%
- Cash resources grew by 120% from R26,7 million to R58,6 million
Group overview
The Group is focused on three major markets:
Enterprise applications
The sale, implementation, integration and management of enterprise applications
solutions. The business grew steadily during the period under review with
pleasing growth in annuity based services revenue and a strong pipeline.
Information security
The sale, distribution and support of security products including anti-virus,
intrusion detection, firewalls, authentication and network asset management and
the provision of managed security services. This division showed impressive
growth in what is a rapidly growing market.
Networking solutions
The design, implementation and management of networking and information
technology infrastructure solutions with a focus on thin client and server based
computing architecture. This division is employed almost exclusively on
providing networking services and has seen a sharp rise in operating margins.
Revenue analysis
Enterprise applications - 45%
Information security - 39%
Networking solutions - 16%
Prospects
There are firm indications of renewed market spend in the areas within which the
Group operates and the directors are confident that the Group will perform
strongly in the new financial year. The focus remains on organic growth whilst
continuing to investigate empowerment investment opportunities.
New initiatives for 2003 - ERP.com Africa
During the last financial year the Group formed a division focused on the sale
of technology products and services into Africa through a network of partners
that have been established in all major African countries. This division was
fully operational from the start of the new financial year and is expected to
make a significant contribution over the next few years in line with the
increasing IT spend emerging from the African continent.
Declaration of dividend, special dividend and dividend policy
In accordance with the Group"s dividend policy, a dividend of 20% of headline
earnings, amounting to 2,3 cents per share, has been declared. A special
dividend of 2,7 cents per share has also been declared bringing the total
dividend declared for the year to 5 cents per share.
The last day to trade "CUM" dividend, in ERP.com shares in order to participate
in the dividends will be Friday, 14 November 2003. From Monday, 17 November 2003
ERP.com shares will commence trading "EX" dividend. The record date will be
Friday, 21 November 2003. Dividend payments will be made on Monday, 24 November
2003.
Share certificates may not be dematerialised or rematerialised between Monday,
17 November 2003 and Friday, 21 November 2003, both days inclusive.
Accounting policies
These financial statements have been prepared on a historical cost basis in
accordance with the South African Statements of Generally Accepted Accounting
Practice. The accounting policies of the Group are consistent with those used
in the preparation of the audited annual financial statements for the year ended
31 July 2002.
Independent review
The financial statements have been reviewed by KPMG Inc., whose unqualified
review opinion is available for inspection at the Group"s registered address.
Directorate
Mr M Spilhaus resigned as director and was replaced by Mr P Sneddon on the Board
of ERP.com Holdings Limited with effect from 1 February 2003. The Board now
consists of an equal number of executive and non-executive directors, two of
whom are fully independent.
For and on behalf of the Board of Directors
Rudolf Pretorius Peter Forsyth
Non-executive chairman Chief executive officer
16 September 2003
Johannesburg
Directors: R Pretorius (Non-executive chairman), P Forsyth (Chief executive
officer)
DTK Brazier*, CJLessing*, P Mather*, GM Morris#, S Nathan , P Sneddon#
* Executive directors
Non-executive director
# Independent non-executive directors
Company secretary: A Ritzlmayr (email: andreasr@erpcom.co.za)
Registered address: ERP.com House, Nanyuki Office Park, 69 Nanyuki Drive,
Sunninghill, Sandton 2157. (PO Box 2880, Rivonia 2128)
Transfer secretaries: Computershare Limited, Investor Services Division
70 Marshall Street, Marshalltown 2001. (POBox 61051, Marshalltown 2107)
Share code: ERP ISIN: ZAE000043493
www.erpcom.co.za
Date: 17/09/2003 05:00:08 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
