| Thu 27 Jan 2005, 16:11 | | INTERIM RESULTS FOR THE SIX MONTHS |
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XANTIUM TECHNOLOGY HOLDINGS LTD - UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS
ENDED 30 NOVEMBER 2004
XANTIUM TECHNOLOGY HOLDINGS LTD
(`Xantium`)
(Registration number 2003/012583/06)
JSE code: XAN ISIN: ZAE000057386
An end-to-end full
IT Service Provider
* Successful listing on Altx
* Results on track to meet annual forecasts
UNAUDITED INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 NOVEMBER 2004
GROUP INCOME STATEMENT
Unaudited Audited
six months nine months
ended ended
30 November 31 May
2004 2004
R`000 R `000
Revenue 38 785 33 587
Earnings/(loss) before interest,
taxation, depreciation and amortisation 9 571 (3 262)
Depreciation (303) (253)
Goodwill amortisation (435) (98)
Net interest received/(paid) 70 (77)
Profit/(loss) before taxation 8 903 (3 690)
Taxation (2 832) 896
Profit/(loss) after taxation 6 071 (2 794)
Attributable to outside shareholders (250) 250
Net profit/(loss) attributable
to shareholders 5 821 (2 544)
Number of shares (000`s)
- Issued 135 000 100 000
- Weighted 129 616 66 667
- Diluted 147 097 68 917
Headline earnings/(loss) per share (cents)
- Issued 4,63 (2,45)
- Weighted 4,83 (3,67)
- Diluted 4,25 (3,55)
Earnings/(loss) per share (cents)
- Issued 4,31 (2,54)
- Weighted 4,49 (3,82)
- Diluted 3,96 (3,69)
Calculation of headline earnings/(loss)
Net profit/(loss) attributable to shareholders 5 821 (2 544)
Adjusted for:
Goodwill amortisation 435 98
Headline earnings/(loss) 6 256 (2 445)
GROUP CASHFLOW STATEMENT
Unaudited Audited
six months nine months
ended ended
30 November 31 May
2004 2004
R`000 R `000
Net cash flows from operations 290 (2 781)
Net cash flows from investing activities (4 002) (3 426)
Net cashflows from financing activities 12 120 2 414
Net increase/(decrease) in cash resources 8 408 (3 793)
Cash resources at beginning of period (3 793) -
Cash resources at end of period 4 615 (3 793)
GROUP BALANCE SHEET
Unaudited at Audited at
30 November 31 May
2004 2004
R`000 R `000
ASSETS
Non current assets 9 973 4 194
Property, plant and equipment 2 783 1 436
Goodwill 6 138 1 863
Deferred taxation 1 052 895
Current assets 27 979 7 470
Inventory 2 396 55
Trade and other receivables 20 834 7 062
Cash resources 4 749 353
Total assets 37 952 11 664
EQUITY AND LIABILITIES
Equity
Ordinary shareholders` funds 19 635 (1 034)
Minority interests in subsidiaries - (251)
Non-current liabilities
Interest bearing liabilities 278 363
Current liabilities 18 039 12 586
Trade and other payables 13 441 7 812
Short-term portion of interest bearing
liabilities 33 33
Bank overdraft 134 4 146
Taxation payable 2 989 -
Provisions 1 442 595
Total equity and liabilities 37 952 11 664
Net asset value per share (cents) 14,54 (1,03)
Net tangible asset value per share (cents) 10,00 (2,89)
GROUP STATEMENT OF CHANGES IN EQUITY
Unaudited Audited
six months nine months
ended ended
30 November 31 May
2004 2004
R`000 R `000
Opening equity (1 034) -
Shares issued 15 500 1 510
Share issue expenses (652) -
Net profit/(loss) for period 5 821 (2 544)
Closing equity 19 635 (1 034)
Commitments
Equipment and premises - rental 638 786
Notes:
1. The interim results have been compiled in accordance with South African
Statements of Generally Accepted Accounting Practice.
2. The accounting policies are consistent with those adopted in the annual
financial statements for the nine months ended 31 May 2004.
3. Diluted number of shares includes shares that are expected to be issued to
vendors on future warranted profits being earned.
COMMENTS
Introduction
The directors of Xantium have pleasure in presenting the maiden interim results
for the six-month period ended 30 November 2004 (`the period`). With effect from
19 August 2004, Xantium successfully listed as the first front-door listing on
Altx of a black empowered IT company.
Group profile
IT spend, globally and in South Africa, is slowly recovering from the post-Y2K
lull. The South African private sector and government have, however, become more
discerning about their IT spend, demanding greater convergence between
technology and a commercially-driven solutions approach that delivers real
business benefits. Demand continues to grow for IT providers offering standard
IT commodity products together with a comprehensive range of services for high-
end solutions.
Xantium is a Proudly South African black empowered IT provider offering
strategic consulting, systems infrastructure design, deployment and support.
Services are delivered through three integrated business pillars:
* Xantium Professional Services
* Xantium Digital Card Systems
* Xantium IT Services (incorporating Spec Systems (`Spec`). As previously
announced on 9 September 2004, Xantium acquired the business of Spec during the
period).
Xantium`s approach prioritises understanding the client`s business, sector and
value proposition before designing end-to-end solutions using input from the
client`s suppliers, partners and customers. This enables Xantium to offer the
most cost-effective and efficient solution.
While Xantium continues to align itself with leading global technology partners,
part of its social development programme is aimed at developing expertise within
the group through ongoing training and up-skill programmes.
BEE
Xantium has a staff complement of 116 people, 45% of which has been classified
as BEE by independent empowerment rating agency Empowerdex. Executive management
has a higher ratio with a 74,5% BEE rating.
Although the group`s BEE rating fulfils the ICT Charter requirements, Xantium is
continuously examining ways to increase BEE ownership and participation through
acquisitions and the group`s internal staff share incentive scheme.
Financial results
Xantium`s maiden interim results for the period reflect operating income and
headline earnings above mid-year expectations, and on track to meet the headline
earnings per share (`HEPS`) forecast of 7,25 cents per share for the year as set
out in the prospectus dated 16 August 2004. Revenue falling slightly below
expectations is attributable to a mix of sales weighted more towards higher
margin services than lower margin products, which will have greater
sustainability in the long term.
Debtors remain high as a result of the successful conclusion of contracts with
Harmony, Ekurhuleni Metropolitan Council and Face Technologies in the later part
of the period. The board is pleased to report that R14,7 million of this amount
had been collected by 31 December 2004.
As this is the first year of operation as an integrated group, comparison with
results of the previous financial year is inappropriate.
Prospects
Although conditions in the IT sector remain challenging, an early stage recovery
has begun to replace post-Y2K scepticism. In this light organic growth is
projected for all of Xantium`s existing businesses. In addition, the group will
continue to grow by acquisition where appropriate to enhance its service and
product offering. Xantium`s service and delivery excellence will continue to be
key to the group`s ongoing growth and success.
The board remains confident of meeting the forecast HEPS of 7,25 cents per share
for the year to May 2005. Shareholders` attention is directed to the cautionary
announcement dated 9 December 2004 in respect of ongoing negotiations.
People
The board thanks the group`s management, employees and business partners for
their dedication and hard work and looks forward to working together to continue
Xantium`s initial success. Special thanks also to shareholders and customers for
their invaluable and ongoing support.
Interim dividend
In line with group policy no interim dividend has been declared for the period.
By order of the board
Dr Popo S Molefe James H Murray
Chairman CEO
Directors:
Dr P S Molefe (Chairman)*; J H Murray (CEO); P A Johnston (CFO);
K J Molefe (Group Marketing Director); N P Nkwanca*; T T Schrimpton (Group
Business Development Director); N B Senne* (*non-executive)
Registered office: 2nd Floor
Milner Place
4 Carse O` Gowrie
Parktown
(PO Box 5420, Meyersdal, 1447)
Transfer secretaries: Ultra Registrars (Pty) Limited
11 Diagonal Street
Johannesburg, 2001
(PO Box 4844, Johannesburg, 2000)
Company secretary: Morestat Corporate Services
2nd Floor
220 Peoples Bank Building
200 Pretorius Street
Pretoria, 0002
(PO Box 1750, Pretoria, 0001)
