CSG HOLDINGS LIMITED - Reviewed Financial Results For The Year Ended 31 March 2021

Reviewed Financial Results For The Year Ended 31 March 2021

CSG HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 2006/011359/06)
Share code: CSG
ISIN: ZAE000184438
(“CSG” or “the Company”)



REVIEWED FINANCIAL RESULTS FOR THE YEAR ENDED 31 MARCH 2021


1.   SALIENT FEATURES

     •   Revenue decreased by 26% from R1.75 billion in the prior corresponding period to
         R1.30 billion from continuing operations.

     •   Profit for the year increased by 165% to R51.71 million from a loss of R79.24 million in
         the prior corresponding period.

     •   The earnings per share (“EPS”) increased to 9.34 cents per share compared to the
         basic loss of 15.52 cents per share reported for the prior year. The improvement was
         mainly due to the security division’s aggressive turnaround plan, the group’s cost-
         cutting initiatives implemented during lockdown, together with assistance received
         from government such as employee tax incentives (ETI) and Skills Development Levy
         (SDL) payment holidays. EPS further increased due to the sale of the 7Arrows Security
         Proprietary Limited (“7Arrows”) business and the related recognition of a profit on sale
         of business. A profit on sale of business was recorded due to the goodwill and
         intangibles written off in prior years.

     •   Headline earnings per share (“HEPS”) increased to 2.62 cents per share from a loss
         of 8.69 cents per share due to the same reasons noted above, with the biggest
         exception that the profit on sale of business of R37.1 million has been excluded from
         headline earnings.

     •   HEPS from continuing operations increased to 5.28 cents per share, compared to
         0.35 cents per share for the comparative period, supporting the turnaround of the
         continuing business.
     •   The majority of the 7Arrows contracts were successfully sold to Fidelity ADT
         Monitoring Proprietary Limited on 1 October 2020. This part of 7Arrows has been
         classified as a discontinued operation.

     •   For the second year in a row, strong cash flow was generated by operations, with
         R118.15 million cash generated for the year.


     The year ended March 2021 was particular difficult for CSG given the tough trading
     environment, but the business leaders rapidly shifted focus, implementing cost-saving
     measures across all operations, including temporary reduction of salaries, wages and
     working hours, deferring capital expenditure, implementing measures to optimise working
     capital and where it could not be avoided, laying off employees, temporary and
     permanently. We also applied for the government related Covid-19 benefits, enabling us to
     continue paying salaries and wages to all employees.

     Despite the challenging times, we focussed on the implementation of our strategy including
     to revise it to incorporate the impact of the pandemic. The core of our strategy is to continue
     to concentrate on delivering labour intense services powered by technology and in the
     process offering clients an integrated service model.


2.    SHORT-FORM ANNOUNCEMENT


      This short-form announcement is the responsibility of the directors of the Company. It
      contains only a summary of the information in the full announcement (“Full
      Announcement”) and does not contain full or complete details. The Full Announcement
      can be found at:
      https://senspdf.jse.co.za/documents/2021/JSE/ISSE/CSG/CSGFY21.pdf


      Copies of the Full Announcement is also available for viewing on the Company’s website
      at https://csgholdings.co.za/investor-relations/ or may be requested in person, at the
      Company’s registered office or the office of the sponsor, at no charge, during office hours.


      Any investment decisions by investors and/or shareholders should be based on
      consideration of the Full Announcement, as a whole.
     
      This short-form announcement has been based on the financial results for the year ended
      31 March 2021, which have been reviewed by the Company’s auditors BDO South Africa
      Incorporated, who expressed an unmodified reviewed conclusion.




1 July 2021


Sponsor
PSG Capital

Date: 01-07-2021 07:15:00
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