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Change Statement, Notice Of Annual General Meeting And Publication Of Integrated Annual Report
AYO TECHNOLOGY SOLUTIONS LIMITED
(Incorporated in the Republic of South Africa)
Registration number: 1996/014461/06
Share code: AYO
ISIN: ZAE000252441
("AYO" or the “Group” or the “Company”)
CHANGE STATEMENT, NOTICE OF ANNUAL GENERAL MEETING AND PUBLICATION OF INTEGRATED
ANNUAL REPORT
1. Introduction
Shareholders are advised that the Company's Integrated Annual Report incorporating the audited
consolidated annual financial statements for the year ended 31 August 2019 ("audited financial
statements"), on which the Company’s auditors expressed an unmodified audit opinion and the notice of
the annual general meeting of the Company (“AGM”) has been distributed to shareholders today 31
January 2020.
The Integrated Annual Report, audited financial statements and notice of AGM are also available on
the Company’s website at https://www.ayotsl.com/integrated-reports/
2. Change statement
The audited financial statements contain the following changes to the reviewed preliminary condensed
consolidated results for the year ended 31 August 2019 released on SENS on 20 December 2019
(“reviewed financial results”):
Changes in the Consolidated Statement of Financial Position as at 31 August 2019.
The following changes relating to the 2019 Statement of Consolidated Financial Position were made:
- There was an error in the calculation of the customer list intangible on the Purchase Price
Allocation (“PPA”) for Zaloserve (Pty) Ltd and there was a portion of an NCI loan of R36 million for
a subsidiary which was not allocated on the PPA for Global Command and Control Technologies
(Pty) Ltd. As a result, intangible assets has been increased by an amount of R14.3 million, Goodwill
has been decreased by an amount of R54.4 million, the deferred tax liability has been increased
by an amount of R8 million and Non-controlling interests (“NCI”) has been reduced by an amount
of R48 million in the audited financial statements.
- There was a reclassification between the non-current other financial assets and trade and other
payables of R0.1 million
- There was a deferred tax asset of R17.1 million which was erroneously recognised on written put
option liabilities in the reviewed financial results. This deferred tax asset has been reversed in the
audited financial statements.
- There was a reclassification between retained income and a change in ownership reserve of R27.4
million.
- There was an error in the calculation of the NCI written put option reserve (“option reserve”) and
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the derivative liability. As a result, the option reserve has been reduced by an amount of R72.7
million and the derivative liability has reduced by an amount of R57.1 million.
- There was a reclassification of R3.1 million between retained income and NCI due to a change in
ownership of a subsidiary.
- Retained income changed by an amount of R6.5 million as a result of the effect of changes in the
consolidated statement of profit or loss and the reclassification to NCI.
- There was a reclassification between the current contingent consideration liability and trade and
other payables of R5.5 million.
- There was a reclassification between trade and other payables and deferred income of R1.3
million.
- There was an increase in the current tax payable balance of R2.1 million as a result of an increase
in the income tax expense.
The effect of the above on the Consolidated Statement of Financial Position is as follows:
Reviewed financial Audited financial Difference
results statements
R’000 R’000 R’000
Goodwill 185 591 131 152 (54 439)
Intangible assets 65 514 79 828 14 314
Non-current other financial assets 12 221 12 355 134
Deferred tax asset 64 425 36 913 (27 512)
Reserves (75 687) (30 470) 45 217
Retained income (70 951) (77 458) (6 507)
Non-controlling interests 185 647 134 392 51 255
Derivatives liability 61 099 3 934 57 165
Trade and other payables 439 511 443 836 (4 325)
Deferred income 17 287 18 589 (1 302)
Current tax payable 22 048 24 124 2 076
Contingent consideration liability 10 295 4 795 5 500
All other line items set out in the Consolidated Statement of Financial Position included in the reviewed
financial results remain unchanged.
Changes in the Consolidated Statement of Profit or Loss and Other Comprehensive Income for the year
ended 31 August 2019.
The following changes relating to the 2019 Consolidated Statement of Profit or Loss and Other
Comprehensive Income were made:
- There was a reclassification between other operating gains/(losses) and finance income of R6.5
million and a gain on bargain purchase of R0.4 million
- There was an error in the calculation of the derivative liability. As a result, the fair value gains on
derivatives has been reduced by an amount of R15.5 million and other operating losses increased
by the same amount.
- There was a deferred tax asset of R17.1 million which was erroneously recognised on written put
option liabilities in the reviewed financial results. This deferred tax asset has been reversed in the
audited financial statements resulting in an increase in tax expense of R17.1 million.
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- There was an additional income tax expense of R3.7 million and deferred tax expense of R1.2
million recognised as a result of error in the previous calculation of income tax.
Earnings per share decreased from 54.29 cents per share to 43.76 cents per share as a result of the
derecognition of the deferred tax asset and the reduction in the fair value gains on derivatives and
additional tax expense. Headline earnings per share decreased from 53.53 cents per share to 43.40 cents
per share as a result of the derecognition of the deferred tax asset and additional tax expense
The effect of the above on the Consolidated Statement of Profit or Loss and Other Comprehensive Income
is as follows:
Reviewed financial Audited financial Difference
results statements
R’000 R’000 R’000
Other operating gains/(losses) (22 813) (44 434) (21 621)
Finance income 316 325 322 856 6 531
Taxation (69 199) (91 186) (21 987)
Basic earnings per share (cents) 54.29 43.76 (10.53)
Headline earnings per share (cents) 53.53 43.40 (10.13)
Headline earnings 184 219 149 358 (34 861)
All other line items set out in the Consolidated Statement of Profit or Loss and Other Comprehensive
Income included in the reviewed financial results remain unchanged.
Changes in the Consolidated Statement of Changes in Equity for the year ended 31 August 2019.
The changes in the Consolidated Statement of Changes in Equity are due to the following adjustments:
- A reclassification between retained income and a change in ownership reserve of R27.4 million.
- Error in the calculation of the option reserve as mentioned above.
- Effect of changes in the consolidated statement of profit or loss.
- Error in the calculation of NCI arising out of acquisition as mentioned above.
The effect of the above on the Consolidated Statement of Changes in Equity is as follows:
Reviewed Audited financial Difference
financial results statements
R’000 R’000 R’000
NCI put option reserve (87 468) (14 795) 72 673
Changes in ownership reserve - (27 455) (27 455)
Retained income (70 951) (77 458) (6 507)
NCI arising out of acquisition 149 313 101 172 48 141
All other line items set out in the Consolidated Statement of Changes in Equity included in the reviewed
financial results remain unchanged.
Changes in the Consolidated Statement of Cash Flows for the year ended 31 August 2019.
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The following changes were identified on the Statement of Cash Flows:
Reviewed Audited Difference
financial results financial
statements
R’000 R’000 R’000
Cash utilised in operations (46 602) (50 320) 3 718
Net cash from operating activities 88 943 114 085 (25 142)
Net cash to investing activities (467 337) (514 472) 47 315
Net cash to financing activities (246 139) (224 145) (21 994)
3. Notice of Annual General Meeting
The AGM will be held at AYO’s office, 2nd Floor, Old Warehouse Building, Black River Park, 2 Fir Street,
Observatory, 7925, on Monday, 23 March 2020 at 08:30 (South African time) to transact the business as
stated in the notice of the AGM forming part of the Integrated Annual Report.
In terms of section 59 of the Companies Act, No 71 of 2008, the record date on which Shareholders must
be recorded as such in the register maintained by the transfer secretaries of the Company for the purposes
of determining which Shareholders are entitled to attend and vote at the AGM is Tuesday, 10 March 2020.
Cape Town
31 January 2020
Joint Sponsor
Vunani Sponsors
Joint Sponsor
Merchantec Capital
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Date: 31-01-2020 05:06:00
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