| Tue 15 Aug 2006, 12:54 | | Compu-Clearing Outsourcing Limited - Reviewed Resu |
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CCL
CCL
Compu-Clearing Outsourcing Limited - Reviewed Results For The Year
Ended 30 June 2006
COMPU-CLEARING OUTSOURCING LIMITED
(Registration number 1998/015541/06)
(Incorporated in the Republic of South Africa)
Share Code: CCL & ISIN: ZAE000016564
("Compu-Clearing" or "the Company")
REVIEWED RESULTS FOR THE YEAR ENDED 30 JUNE 2006
COMMENTARY
It gives me pleasure to present our results for the year ended 30 June
2006. Growth in headline earnings per share of 30% have been achieved
through increased revenues, improved cost control, and reduction in the STC
charge. The introduction of our Business Partner program, and closure of
our branches, towards the end of the previous financial year, have been
catalysts in this regard. We will use the Business Partner strategy in our
attempts to establish a geographical presence abroad and to improve service
levels. Ignoring the once off impact of the reduced STC charge, growth in
our headline earnings, is still a very acceptable 25%.
Compu-Clearing has recently invested close to R3 million in the renewal of
hardware and improvement of the group"s disaster recovery capabilities.
Nevertheless, cash levels remain excellent and as a result, the board has
approved a dividend of 11 cents a share and, subject to shareholder
approval, a capital distribution of 9 cents a share, resulting in total
payments to shareholders of 20 cents per share. Notwithstanding the
distribution of the entire earnings, the group will still maintain
sufficient cash to fund future operations and expansion.
The group expects turnover for the next financial year to be boosted by
winning contracts to supply systems to a number of major clients. The
group"s banking and order planning systems, are gaining momentum and are
likely to begin generating revenues in the second half of the next
financial year.
Compu-Clearing"s international systems require some redevelopment, all of
which will be done locally. As a result, no contribution is expected for
the next 6 to 12 months from the international operations. Management,
however, remain confident of the international division"s long-term
feasibility.
Sponsor Auditors
Sasfin Capital KPMG
(a division of Sasfin Bank Limited)
BALANCE SHEET IFRS
restated
30/06/2006 30/06/2005
(Reviewed) (Reviewed) % Inc./
R"000 R"000 (decr.)
ASSETS
Non current assets 15,879 13,959
Property, plant and equipment 14,370 12,027
Intangible asset 1,111 2,976
Deferred taxation asset 398 330
Current assets 29,194 25,536
Inventory 75 16
Trade and other receivables 7,183 6,369
Taxation receivable 18 1,974
Investments 2,296 4,583
Cash and cash equivalents 19,622 12,594
Total assets 45,073 39,495
EQUITY AND LIABILITIES
Shareholders" funds 40,343 35,396
Share capital and premium 11,657 10,598
Reserves 28,686 24,798
Non-current liabilities 1,824 1,552
Post retirement medical obligations 1,583 1,476
Deferred taxation liability 241 76
Current liabilities 2,906 2,547
Trade and other payables 2,906 2,540
Taxation payable - 7
Total equity and liabilities 45,073 39,495
Net asset value per share (cents) 103.9 92.0 13
INCOME STATEMENT IFRS
Year ended restated
30/6/2006 year ended
(Reviewed) 30/6/2005 % Inc/
R"000 (Reviewed) (decr.)
R"000
Rental and other revenue 38,759 37,563
Operating costs 30,260 29,618
- Distribution 21,961 21,880
- Administration 7,528 6,796
- Other 771 942
Operating profit 9,499 7,945 20
Branch closure expenses - (281)
Profit before net finance revenue
and taxation 9,499 7,664
Net finance revenue 1,648 1,699
- Financial income 1,843 1,741
- Financial expense (195) (42)
Profit before taxation 11,147 9,363 19
Taxation- Normal and deferred 3,082 2,720
Taxation- STC (secondary tax on
companies) 480 857
Profit for the year attributable to
ordinary shareholders 7,585 5,786 31
Actual number of shares in issue 38,836 38,461
("000)
Weighted average number of shares
in issue ("000) 38,609 38,296
Diluted weighted average number of
shares in issue ("000) 41,013 39,845
Basic earnings per share (cents) 19.6 15.1 30
Diluted earnings per share (cents) 18.5 14.5
Ordinary dividend paid per share 8.0 6.0
(cents)
Special dividend paid per share 10.0 -
(cents)
RECONCILIATION OF HEADLINE EARNINGS
Profit for the year attributable to
ordinary shareholders 7,585 5,786
Adjusted for:
Loss on disposal of property, plant
and equipment 123 97
Taxation effect (36) (28)
Headline earnings 7,672 5,855 31
Headline earnings per share (cents) 19.9 15.3
Diluted headline earnings per share 18.7 14.7
(cents)
SEGMENTAL REPORT
Local sources
Software rental revenue 28,454 26,212 9
Hardware rental revenue 9,064 8,885 2
Other 2,158 2,378 (9)
Total revenue from local sources 39,676 37,475 6
Segment result from local sources 9,629 8,333 15
Operating margin from local 24% 22%
sources
International sources
Software rental revenue 83 88
Segment result from international (130) (388)
sources
Total revenue 39,759 37,563
Total segment result 9,499 7,945
Operating margin from all sources 24% 21%
CASH FLOW STATEMENT
IFRS
Year ended restated
30/6/2006 year ended
(Reviewed) 30/6/2005 % Inc/
R"000 (Reviewed) ( decr.)
R"000
Operating profit before net
finance revenue and taxation 9,499 7,945
Non cash items 2,576 3,349
Cash generated by trading 12,075 11,294
operations
Increase / (decrease) in post 107 (115)
retirement medical obligations
Branch closure costs - (281)
Increase in working capital (508) (1,055)
Cash generated by operations 11,674 9,843
Taxation paid (1,613) (6,797)
Dividend paid (3,847) (6,862)
Net financial revenue 1,648 1,699
Cash flow from operating 7,862 (2,117)
activities
Cash flow from investing (1,893) (7,768)
activities
Cash flow from financing 1,059 550
activities
Increase/ (decrease) in cash and 7,028 (9,335)
cash equivalents
Cash and cash equivalents at the 12,594 21,929
beginning of the year
Cash and cash equivalents at the 19,622 12,594
end of the year
STATEMENT OF CHANGES IN EQUITY
IFRS
Year restated
ended year
30/6/2006 ended
R"000 30/6/2005
R"000
Balance at beginning of year 35,396 35,763
Share capital 4 3
Share premium 1,055 547
Recognised income and expense 7,585 5,786
Profit before share-based payment 7,735 5,945
Share-based payment expense (150) (159)
Dividend paid (3,847) (6,862)
Share-based payment reserve 150 159
Balance at end of year 40,343 35,396
RECONCILIATION BETWEEN IFRS AND SA
GAAP
IFRS IFRS
restated transition
Year ended 1 July
30 June 2004
2005 (Reviewed)
(Reviewed) R"000
R"000
IFRS EQUITY IMPACT
Equity as previously reported - SA 34,225 34,638
GAAP
Adjustments 1,171 1,125
IFRS 2 share-based payment reserve 418 259
IFRS 2 share-based payment expense (418) (259)
IAS 16 Restatement of useful lives, 1,071 1,016
residual values and components of
property, plant and equipment
IAS 16 Deemed cost adjustment to 579 591
property
Deferred taxation effect of above (479) (482)
adjustments
Equity restated - IFRS 35,396 35,763
IFRS INCOME STATEMENT IMPACT
Profit as previously reported - SA 5,899
GAAP
Adjustments (113)
IFRS 2 share-based payment expense (159)
IAS 16 Depreciation effect to reflect 43
the changes in useful lives, residual
values and components of property,
plant and equipment
Deferred taxation effect of above 3
adjustments
Profit restated - IFRS 5,786
BASIS OF PREPARATION
The Group has adopted IFRS for the first time in the preparation of these
results and has applied IFRS 1 (First time adoption of International
Financial Reporting Standards). The condensed financial statements have
been prepared in accordance with IAS 34. The accounting policies set out
below have been applied consistently to all periods presented in these
condensed financial statements. They also have been applied in preparing an
opening IFRS balance sheet as at 1 July 2004, for the purposes of the
transition to IFRS, as required by IFRS 1.
In terms of IAS 1, investments in property instruments, previously included
in cash and cash equivalents, are now disclosed separately, due to the
different risk profile applicable to these investments.
IFRS 1 elections applicable 1 July 2004
Fair value deemed cost
The Group has elected to measure its property at fair value on 1 July 2004,
the date of transition to IFRS. Hence fair value is deemed to be cost at
that date.
Adoption of IFRS 2 Share-based payment transactions
The Group has elected to apply the share based payments exemption. In terms
of this exemption, options granted before 7 November 2002, or granted
thereafter but vested before 1 January 2005 are not subject to IFRS2.
Share-based payment transaction accounting policy
The Group grants share options to employees, in terms of the Compu-Clearing
Share Incentive Scheme. The options are subject to service vesting
conditions. The Group recognises the fair value of the options granted (on
grant date) as an employee benefit expense, over the vesting period. A
corresponding amount is recognised in the share-based payment reserve in
equity, as these are equity settled.
The expense is adjusted at the end of each period to reflect actual and
anticipated levels of vesting.
Adjustments implemented with effect from 1 July 2004
IFRS 2 - Share-based payments
An adjustment has been made to retained earnings at this date, in
accordance with IFRS 2 and amounts are now expensed over the vesting
period.
IAS16 - Property, plant and equipment
Deemed cost
The cost of the Group"s property has been adjusted to recognise the fair
value of the property at 1 July 2004, as deemed cost under IFRS.
Other adjustments
Residual values
In calculating the depreciation charge, the Group has reduced the
depreciable amount of its assets in each period by its estimated residual
value. In previous years, under SA GAAP, the estimated residual value was
not determined on recognition of the asset and was not subject to
reassessment. The Group now reassesses the residual value of its property,
plant and equipment at each reporting date.
Useful lives
The Group has reassessed the useful life of all property, plant and
equipment, to correct any useful lives that were previously assessed
incorrectly. In instances were the cost of items of property, plant and
equipment was fully depreciated the carrying value of such assets have been
adjusted to reflect the applicable useful life and residual value. In
future, useful lives will be reassessed at each reporting date.
Componentisation
When parts of an item of property, plant and equipment have different
useful lives or residual values, those components are accounted for as
separate parts of items of property, plant and equipment.
Effects of IFRS adoption
The adoption of IFRS has resulted in a 0,7 cent increase in earnings per
share to 19,6 cents and a 0,8 cents increase in headline earnings per share
to 19,9 cents.
Segmental analysis
The primary basis of preparation of the segmental report is geographical
segments.
REVIEW REPORT
The Group"s auditors KPMG Inc, have reviewed the financial information for
the year ended 30 June 2006. Their unqualified report is available for
inspection at the registered office of the Company.
DIVIDENDS AND DISTRIBUTIONS TO SHAREHOLDERS
Notice is hereby given of the declaration of an ordinary cash dividend of
11 cents per share (2005: 10 cents) ("the dividend"). The following salient
dates apply to the dividend:
Last date to trade `cum` the dividend Friday, 1 September 2006
Trading commences `ex` the dividend Monday, 4 September 2006
Dividend record date Friday, 8 September 2006
Date of payment Monday, 11 September 2006
Share certificates may not be dematerialised or rematerialised during the
period Monday, 4 September 2006 to Friday, 8 September 2006, both days
inclusive.
Notice is hereby given that the board of directors has further resolved to
distribute to ordinary shareholders a portion of the share premium account
in lieu of a dividend to ordinary shareholders (`the distribution`). The
distribution will amount to 9 cents per ordinary share (2005: Nil). In
terms of the company`s Articles of Association and the JSE Limited`s
Listings Requirements, any such distribution is subject to the passing of
an ordinary resolution by the company`s shareholders. It is accordingly
proposed that the appropriate resolution will be put to shareholders at the
Annual General Meeting of the company (`AGM`) which will take place on 25
October 2006. Should such resolution be approved by the shareholders, the
following salient dates to the distribution will apply:
Last date to trade `cum` the distribution Friday, 3 November 2006
Trading commences `ex` the distribution Monday, 6 November 2006
Record date Friday, 10 November 2006
Date of payment Monday, 13 November 2006
Share certificates may not be dematerialised or rematerialised during the
period Monday, 6 November 2006 to Friday, 10 November 2006, both days
inclusive.
For and on behalf of the Board
Johannesburg A.Garber J. du Preez
15 August 2006 (Chairman) (Chief Executive)
Directors: A.Garber, J.du Preez, A.Katz*, M.Lutrin*, D. Rosevear*,
Dr.T.M.Mogale*, M.Steele*, A. Webb*, C.P. Efthymiades, M.Acosta-Alarcon
*(Non-executive)
Transfer secretaries: Registered office:
Computershare Investor Services 2004 Limited 7 Drome Road
Ground Floor Lyndhurst, 2106
70 Marshall Street PO Box 890856
Johannesburg, 2001 Lyndhurst, 2106
Date: 15/08/2006 12:54:19 PM Produced by the JSE SENS Department
