| Tue 7 Oct 2003, 12:32 | | UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS |
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DATACENTRIX HOLDINGS LIMITED -
DATACENTRIX HOLDINGS LIMITED
INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA
REGISTRATION NUMBER: 1998/006413/06
"DATACENTRIX HOLDINGS LIMITED" OR "THE GROUP"
SHARE CODE: DCT
ISIN: ZAE 000016051
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2003
Consolidated Income Statement
6 Months 6 Months 12 Months
ended ended ended
31 August 31 August 28 February
2003 2002 2003
R"000 R"000 R"000
Revenue 397 420 413 151 770 738
Operating income before depreciation, 30 179 32 651 58 315
profit on disposal
of business, goodwill amortised and
interest (EBITDA)
Depreciation (3 467) (2 715) (5 589)
Net profit from disposal of business - 1 383 1 383
Goodwill amortised (4 333) (4 540) (7 677)
Operating income before interest and 22 379 26 779 46 432
taxation
Net interest received 6 246 3 185 7 420
Share of associate income 144 - 1 134
Income before taxation 28 769 29 964 54 986
Taxation (9 931) (10 033) (18 069)
Earnings attributable to ordinary 18 838 19 931 36 917
shareholders
Accumulated earnings at the beginning 105 089 68 172 68 172
of the year
Accumulated earnings at the end of 123 927 88 103 105 089
the period
-
Headline and diluted headline 11.5 11.8 21.8
earnings per ordinary share (cents)
Basic and diluted basic earnings per 9.3 10.2 18.6
ordinary share (cents)
Weighted average number of shares in 202 138 195 460 198 363
issue (000"s)
Reconciliation of Headline Earnings
Net income after taxation 18 838 19 931 36 917
Goodwill amortised 4 333 4 540 7 677
Net profit from disposal of business - (1 383) (1 383)
Headline earnings 23 171 23 088 43 211
Consolidated Balance Sheet
31 August 31 August 28 February
2003 2002 2003
R"000 R"000 R"000
ASSETS
Non-current assets 81 068 80 707 79 160
Property and equipment 15 456 13 495 14 191
Intangible assets 36 899 42 210 37 191
Investment in associate 1 257 714 917
Advance payments 5 749 5 365 5 529
Deferred taxation 11 094 8 809 11 094
Loan to share trust 10 613 10 114 10 238
Current assets 256 722 228 529 249 042
Inventories 11 482 9 232 10 403
Accounts receivable 97 453 112 074 120 884
Bank balances and cash 147 787 107 223 117 755
TOTAL ASSETS 337 790 309 236 328 202
EQUITY AND LIABILITIES
Capital and reserves 191 012 154 476 170 202
Share capital 20 20 20
Share premium 43 727 38 673 43 754
Non-distributable reserves 14 543 14 543 14 543
Acquisition consideration (shares) 8 795 13 137 6 796
due to vendors
Accumulated profits 123 927 88 103 105 089
Non-current liabilities
Acquisition consideration (long-term 920 12 155 12 155
cash) due to vendors
Current liabilities 145 858 142 605 145 845
Accounts payable and accruals 90 765 95 560 102 853
Provisions 3 391 2 929 3 295
Deferred revenue 22 868 19 060 21 555
Acquisition consideration (short-term 11 134 8 235 7 231
cash) due to vendors
Taxation 17 700 16 820 10 911
TOTAL EQUITY AND LIABILITIES 337 790 309 236 328 202
Net asset value per share (cents) 98 80 88
Tangible net asset value per share 79 58 69
(cents)
Number of shares in issue (000"s) 194 737 193 081 193 081
Statement of Changes in Equity
6 Months 6 Months 12 Months
ended 31 ended 31 ended 28
August August February
2003 2002 2003
R"000 R"000 R"000
Opening balance 170 202 119 345 119 345
Net income for the period 18 838 19 931 36 917
Share issue expenses (28) (24) (242)
Non-achievement of profit warranties - - (1 042)
Acquisition consideration due - 2 000 15 224 15 224
share issues
Closing balance 191 012 154 476 170 202
Consolidated Cash Flow
Statement
6 Months 6 Months 12 Months
ended 31 ended 31 ended 28
August August February
2003 2002 2003
R"000 R"000 R"000
Net cash inflow from operating 43 063 47 999 62 150
activities
Net cash outflow from investing (7 670) (9 477) (12 878)
activities
Net cash outflow from financing (5 361) (2 759) (2 977)
activities
Net increase in cash and cash 30 032 35 763 46 295
equivalents
Cash and cash equivalents at the 117 755 71 460 71 460
beginning of the period
Cash and cash equivalents at the end 147 787 107 223 117 755
of the period
Commentary
The directors of Datacentrix Holdings Limited are pleased to present the interim
results of the Group for the six months ended 31 August 2003. Datacentrix has
performed well in a difficult and challenging environment. The Group"s
empowerment profile, strong customer focus, tight operational and financial
controls, a performance driven culture, delivery capacity and balance sheet
continue to make it an ideal partner for vendors and clients looking for a long-
term strategic partner.
Nature of business
The Group"s major activities comprise the supply, integration and optimisation
of IT infrastructure, solutions and related services to enterprise South Africa.
Results
Turnover was down by 4% compared to the corresponding period, mainly due to the
strengthening Rand (the equivalent turnover in US Dollar compared to the
corresponding period shows growth of greater than 25% for hardware and software
sales, which are all imported). As a consequence, EBITDA, earnings and headline
earnings per share were down by 8%, 9% and 3% respectively. Compared
sequentially to the six month period ended February 2003, turnover was up by
11%, and EBITDA, earnings and headline earnings per share up by 19%, 11% and 15%
respectively.
Net asset value per share increased 21% to 98 cents compared to the
corresponding period and tangible net asset value per share increased 34% to 79
cents. Cash generated from operations was R43 million, resulting in R147 million
cash on hand, with no interest bearing debt.
Infrastructure and Services
The Infrastructure division has shown consistent growth during the period under
review when one allows for the strengthening of the Rand and the scrapping of
import duties. The division continues to be a pre-eminent player in the supply,
maintenance and support of IT infrastructure. A number of multiyear contracts
have been secured or renewed. The division has bolstered its presence in
Johannesburg and has made significant gains in this market.
The focus on the enterprise market and the opportunities presented by server and
storage consolidation trends has fuelled strong growth for high-end servers,
storage and enterprise backup library solutions. The division is firmly
established as a serious player in the enterprise solutions space.
Selective outsourcing opportunities remain the focus area for Services, bringing
the benefit of stronger strategic client relationships, better planning and
annuity income. A number of new blue-chip outsource clients were obtained
during the period under review. The Services division maintains exceptional
relationships with clients for whom it delivers consistently high service
levels.
Relationships with product vendors, on behalf of whom in-warranty hardware
repairs are performed, continue to be strong. Direct partner contracts have been
renewed and accreditations maintained with selected best of breed international
technology vendors.
Solutions
The Solutions division offers hosted services, consulting, supply,
implementation and training of business solutions for the enterprise market.
Its skills base focuses on hosted application services, financial systems, data
mining, archiving, data exchange, workflow and the integration of dissimilar
back end systems within the enterprise. The ERP focus of this division is
primarily on the Windows/Intel platform with the Microsoft Business Solutions
offering.
Growth for this division will be fuelled by the need for archiving of data and
documents for statutory requirements, integration of dissimilar applications,
document management and workflow to optimise existing processes; business
intelligence to support business decisions; and the move towards outsourcing of
business applications. Microsoft"s entry into the CRM market will provide
Datacentrix with an additional superior offering to the corporate market.
Black Economic Empowerment
Datacentrix continues to focus strongly on internal transformation imperatives
and also participates actively in the ICT forums to promote transformation.
Strong equity and empowerment shareholder involvement and employment equity
credentials place Datacentrix ahead of the anticipated ICT charter requirements.
Independent confirmation of our progress in this area is provided by the "A"
rating from Empowerdex, a leading rating agency on BEE. Particular focus is now
being placed on further enhancing our empowerment supplier purchase program and
corporate social investment.
Future prospects
Management continues to be confident about the company"s prospects to year-end
and beyond. The decreasing cost of IT infrastructure may have a positive impact
on the renewal cycles for many corporates. Government spending is expected to
accelerate as the procurement processes of SITA are finalised.
Our focus on both partial outsourcing and full hosted services has yielded a
number of significant opportunities currently under evaluation by potential
clients. The Services division has achieved important renewals from blue chip
clients. The full potential of the Johannesburg market is yet to be achieved and
the outlook is promising. As mentioned at the beginning of the year, we also
expect growth in the enterprise storage and server consolidation and Microsoft
products and solutions.
A strengthening Rand will have a negative impact on revenue, but as highlighted
earlier, may have the unanticipated benefit of accelerated renewal cycles.
The Group"s strategy, balance sheet and strong managerial control place it in a
relatively strong position, creating a solid platform for consolidation and
growth.
Dividends
No dividends have been declared or paid during this period. The dividend policy
is being reviewed by the board on an ongoing basis.
Accounting policies
The financial statements have been prepared in accordance with South African
Statements of Generally Accepted Accounting Practice and the accounting policies
used in their preparation are consistent with those adopted in the previous
financial period.
Board appointment
The board is pleased to announce the appointment of Liz Naidoo, the Group"s
current CFO as financial director of Datacentrix Holdings Limited effective 6
October 2003.
For and on behalf of the Board
Gary Morolo
Executive Chairman
7 October 2003
Pretoria
Directors:
Gary Morolo, Gerhard Uys, Klaas Lammers, Stewart Barker, Charl Joubert, Ahmed
Mahomed, Liz Naidoo
Sam Nematswerani*, Joan Joffe*, Christoff Botha* Natanya Kuper*, Imogen Mkhize*
* Non-executive
Registered Office: Transfer Secretaries:
Sanwood Park Block 7 Computershare Limited
379 Queens Crescent 70 Marshall Street
Lynnwood Johannesburg
Pretoria www.datacentrix.co.za
Date: 07/10/2003 12:30:10 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
