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ZPT
ZPT
Zaptronix - Trading Update And Cautionary Announcement
ZAPTRONIX LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1997/014928/06)
Share code: ZPT & ISIN: ZAE000070934
("Zaptronix" or "the company")
TRADING UPDATE AND CAUTIONARY ANNOUNCEMENT
Shareholders are advised that Zaptronix expects its earnings and headline
earnings per share, for the financial year ended 31 August 2006, to be
between 80% and 100%, lower compared to the previously reported forecast of
the 23 June 2006.. The decline in earnings is primarily attributable to
seasonal sales of metering hardware, which has shifted into the new
financial year, and delay in the rollout of new products that required
further investment into development.
Income from tenders constitute a substantial part of the business outlook
for the group. No tenders have been awarded to Zaptronix in the period
under review. Management is however confident in pursuing the tender
business.
Further capital was invested in the completion of the tracking technology
following the initial rollout of the system. The rollout of the complete
feature set had to be delayed. The project has been completed and the
rollout of the system to new and existing customers is being accelerated.
The loss in revenue along with the seasonal shift in metering hardware
sales accounted for the remaining variance from forecast. Although no
tenders were awarded, management contained operating cost below the figures
forecasted.
The accumulated investment in the GSM communications technology is
currently being applied to the Automated Meter Reading (AMR) business. The
communications cost is substantially below the norm for this industry and
is expected to place Zaptronix in a favourable position for services and
tenders.
Further investments were made in the development of applications to give
the logistics division of the group a competitive advantage. A unique
research project on the data mining of traffic information has matured into
the application phase. The project, code named FX, will enable clients to
better forecast and plan their logistics operations based on actual daily
traffic density data rather than the limited parameter settings used in all
planning software. The product will allow clients to accurately plan and re-
plan their logistics plan intra day. The potential for cost savings on
transport capacity for clients makes this product very attractive. The FX
system achieves this by building statistical models based on changing
traffic density patterns. The product will be launched in the market place
early in 2007 after its pilot implementation with an existing client. The
FX project fits with the Vision for the group of building financial
products on their technology offering. The data mining will ultimately lead
to the development of a point-to-point vehicle and freight usage insurance.
The forecast financial information on which this trading statement is based
has not been reviewed or reported on by Zaptronix"s auditors.
The group"s financial results for the year ended 31 August 2006 will be
published on or about 28 November 2006
Warning:
The listing of the ordinary shares in the Company is on the AltX. Investors
are advised of the risks of investing in a Company listed on AltX and that
the JSE Limited does not guarantee the viability or success of a Company
listed on AltX. In terms of the JSE Listings Requirements ("LR"), the
Company is obliged to appoint and retain a Designated Advisor ("DA"). The
DA is required to, inter alia, attend all board meetings held by the
company, ensure that all the LR and applicable regulations are complied
with, approve the financial director of the Company and guide the Company
in a competent, professional and impartial manner. If the Company fails to
retain a DA, it must make arrangements to appoint a new DA within ten
business days, failing which the Company faces suspension of trading in its
securities. If a DA is not appointed within 30 days of its suspension, the
Company faces the termination of its listing without the prospect of an
appropriate offer to minority shareholders.
Midrand
03 November 2006
Designated Advisor
Sasfin Capital
(a division of Sasfin Bank Limited)
Date: 03/11/2006 03:40:35 PM Produced by the JSE SENS Department
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