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Abridged Audited Consolidated Financial Results
PRESCIENT LIMITED
Registration number: 1936/008278/06
JSE share code: PCT
ISIN: ZAE000163531
ABRIDGED AUDITED CONSOLIDATED FINANCIAL RESULTS
For the twelve months ended
31 March 2014
Highlights
- Local assets under management of R59.1 billion (2013: R59.6 billion)
- Third party assets under administration of R31.1 billion in South Africa (2013: R16.9 billion) and EUR1.2
billion globally (2013: EUR821.8 million)
- Revenue for the group up by 39% to R664.6 million (2013: R477.3 million)
- Profit before tax from continuing operations up by 11% to R152.2 million (2013: R137.5 million)
- Basic earnings per share for continuing operations up 4% to 7.15 cents per share (2013: 6.88 cents per share)
- Headline Earnings per share of 6.53 cents per share (2013: 7.51 cents per share)
- Headline Earnings per share for continuing operations of 6.96 cents per share (2013: 7.05 cents per share)
- Final gross dividend of 2.6 cents per share
Audited consolidated statement of financial position
Audited Audited
31 March 31 March
2014 2013
R'000 R'000
Assets
Non-current assets 7,331,567 6,674,148
Property and equipment 11,210 14,155
Investment property 24,724 17,711
Goodwill and intangible assets 423,361 472,816
Deferred tax asset 4,841 3,187
Long-term loans and other receivable 70,288 73,607
Investment in equity-accounted investees 1,493 1,398
Financial assets at fair value through profit or loss 105,842 99,260
Linked investments backing policyholder funds 6,689,808 5,992,014
Current assets 527,764 676,985
Inventory 10,506 16,096
Trade and other receivables 171,692 167,139
Amounts owing by clearing houses - 223,730
Amounts owing by clients 287,082 151,429
Taxation receivable 3,398 11,688
Cash and cash equivalents 55,086 106,903
Total assets 7,859,331 7,351,133
Equity
Stated capital 637,062 637,062
Reserves (841) 280
Retained income 96,367 93,595
Total equity attributable to owners of the Company 732,588 730,937
Non-controlling interests 8,461 9,781
Total equity 741,049 740,718
Liabilities
Non-current liabilities 6,732,401 6,101,012
Deferred tax liability 5,480 7,017
Deferred income - 3,206
Policyholder investment contract liabilities 6,685,086 5,989,473
Loans payable 41,835 101,316
Current liabilities 385,881 509,403
Trade and other payables 57,594 110,719
Provisions - 518
Amounts owing to clearing houses 138,738 -
Amounts owing to clients 147,916 374,591
Deferred income - 2,491
Current tax payable 6,726 14,822
Loans payable 12 865 -
Bank overdraft 22,042 6,262
Total liabilities 7,118,282 6,610,415
Total equity and liabilities 7,859,331 7,351,133
Audited consolidated statement of profit or loss and other comprehensive income
12 months 12 months
Audited Audited
31 March 31 March
2014 2013
Restated
R'000 R'000
Continuing operations
Total income 664,626 477,308
Service fees 638,013 450,760
Interest and dividend income 15,970 16,853
Other investment income 10,643 9,691
Cost of information management services** (286,599) (144,232)
Operating expenses (231,720) (190,668)
Profit from operations 146,307 142,408
Other income 10,652 1,297
Share of loss of equity-accounted-investees (net of tax) (573) (219)
Finance costs (4,155) (5,945)
Profit before tax 152,231 137,541
Income tax expense (39,592) (40,961)
Profit from continuing operations 112,639 96,580
Discontinued operation
(Loss)/profit for the period from discontinued operation (48,774) 6,378
Profit for the year 63,865 102,958
Other comprehensive income
Items that are or may be reclassified to profit or loss
Foreign currency translation differences - foreign operations (1,383) 12,396
Tax on other comprehensive income - -
Other comprehensive income for the year, net of tax (1,383) 12,396
Total comprehensive income for the year 62,482 115,354
Profit attributable to:
Owners of the Company 63,088 102,456
Non-controlling interests 777 502
Profit for the year 63,865 102,958
Total comprehensive income attributable to:
Owners of the Company 61,705 114,852
Non-controlling interests 777 502
Total comprehensive income for the year 62,482 115,354
Earnings per share (cents)
Basic earnings per share 4.03 7.34
Diluted earnings per share 4.03 7.34
Earnings per share - continuing operations (cents)
Basic earnings per share 7.15 6.88
Diluted earnings per share 7.15 6.88
Headline earnings per share (cents)
Continuing operations 6.96 7.05
Discontinued operation (0.43) 0.46
Earnings per share Audited Audited
31 March 2014 31 March 2013
Weighted average number of shares in issue during the period 1,565,528,451 1,396,375,360
Weighted average number of shares potentially in issue 1,565,528,451 1,396,375,360
Actual number of shares in issue at the end of the period 1,598,022,450 1,576,346,232
Treasury shares 26,411,114 24,317,180
Shares in issue net of treasury shares 1,571,611,336 1,552,029,052
Continuing operations R'000 R'000
Earnings attributable to shareholders 112,639 96,580
Non-controlling interests (777) (502)
Earnings attributable to ordinary shareholders 111,862 96,078
Headline earnings attributable to shareholders 108,953 98,439
Discontinued operations
Earnings/(losses) attributable to shareholders (48,774) 6,378
Non-controlling interests - -
Earnings attributable to ordinary shareholders (48,774) 6,378
Headline earnings attributable to shareholders (6,664) 6,378
* The prior year comparative has been restated to reflect Prescient Ireland as a discontinued operation
** Cost of information management services in the prior year has been adjusted to include consulting fees amounting to
R8.85 million that were previously included in operating expenses. The reason for the reclassification is to
better reflect the nature of these expenses. The net effect on profit from operations is nil.
Abridged audited consolidated segment report
Financial Services
Audited Audited
31 March 31 March
2014 2013
R'000 R'000
Continuing Discontinued Continuing Discontinued
Segment external revenue 287,124 94,906 273,548 126,788
Segment profit/(loss) before tax 108,080 (48,824) 112,873 5,842
Information Management Services
Audited Audited
31 March 31 March
2014 2013
R'000 R'000
Continuing Discontinued Continuing Discontinued
Segment external revenue 377,502 - 203,760 -
Segment profit/(loss) before tax 44,151 - 24,668 -
Group
Audited Audited
31 March 31 March
2014 2013
R'000 R'000
Continuing Discontinued Continuing Discontinued
Segment external revenue 664,626 94,906 477,308 126,788
Segment profit/(loss) before tax 152,231 (48,824) 137,541 5,842
Abridged audited consolidated statement of cash flows
2014 2013
R'000 R'000
Cash flows from operating activities
Profit for the year 63,865 102,958
Income tax expense 39,592 40,424
Non-cash movements and adjustments to profit before tax (62,825) (638,260)
Cash generated from policyholder activities 98,935 622,667
Contributions and investment income 1,794,917 3,117,168
Withdrawals by policyholders (1,695,982) (2,494,501)
Changes in working capital (54,374) (10,213)
Dividends received 272 544
Dividends paid (62,496) (88,137)
Interest received 15,698 16,309
Interest paid (10,233) (12,735)
Taxation paid (45,920) (51,433)
Net cash outflow from operating activities (17,486) (17,876)
Cash flows from investing activities
Net acquisition of equipment (1,892) (7,463)
Acquisition of subsidiary, net of cash acquired (313) 82,343
Net (acquisition)/disposal of intangible assets (5,021) 8,150
(Investment)/disposal in equity-accounted investees (811) 711
Dividends from equity-accounted investees 143 2,124
Disposal/(acquisition) of financial assets at fair value through profit or loss 496 (15,875)
Repayment / (advances) of long-term loans receivable 3,455 (3,328)
Disposal of discontinued operation, net of cash disposed of (8,029) -
Cash (outflow)/inflow from investing activities (11,972) 66,662
Cash flows from financing activities
Acquisition of own shares (263) (922)
Additional investment in subsidiary - (4,323)
Decrease in deferred income - (1,804)
Decrease in loans payable (47,481) (2,706)
Cash outflow from financing activities (47,744) (9,755)
Net (decrease)/increase in cash and cash equivalents (77,202) 39,031
Effect of exchange rate fluctuations on cash held 9,605 8,779
Cash and cash equivalents at beginning of the year 100,641 52,831
Cash and cash equivalents at end of the year 33,044 100,641
Abridged audited statement of changes in equity
Stated Translation Treasury Retained Non-controlling
R'000 capital reserve shares income Total interests Total equity
Balance at 1 April 2012 53,309 - (13,038) 63,963 104,234 - 104,234
Total comprehensive income for the year
Profit for the year - - - 102,456 102,456 502 102,958
Total other comprehensive income - 12,396 - - 12,396 - 12,396
Total comprehensive income for the year - 12,396 - 102,456 114,852 502 115,354
Transactions with owners recognised directly in
equity
Contributions by and distributions to owners of the
Company
Treasury shares sold - - 922 - 922 - 922
Dividends declared during the year - - - (51,218) (51,218) - (51,218)
Issue of ordinary shares related to business combinations 583,753 - - - 583,753 - 583,753
Total contributions by and distributions to owners of the
Company 583,753 - 922 (51,218) 533,457 - 533,457
Changes in ownership interests in subsidiaries
Acquisition of non-controlling interests - - - (21,606) (21,606) 9,279 (12,327)
Total changes in ownership interests in subsidiaries - - - (21,606) (21,606) 9,279 (12,327)
Total transactions with owners of the Company 583,753 - 922 (72,824) 511,851 9,279 521,130
Balance at 31 March 2013 637,062 12,396 (12,116) 93,595 730,937 9,781 740,718
Stated Translation Treasury Retained Non-controlling
R'000 capital reserve shares income Total interests Total equity
Balance at 1 April 2013 637,062 12,396 (12,116) 93,595 730,937 9,781 740,718
Total comprehensive income for the year
Profit for the year - - - 63,088 63,088 777 63,865
Total other comprehensive income - (1,383) - - (1,383) - (1,383)
Total comprehensive income for the year - (1,383) - 63,088 61,705 777 62,482
Transactions with owners recognised directly in equity
Contributions by and distributions to owners of the Company
Treasury shares sold - - 262 - 262 - 262
Dividends declared during the year - - - (60,316) (60,316) (2,180) (62,496)
Total contributions by and distributions to owners of
the Company - - 262 (60,316) (60,054) (2,180) (62,234)
Changes in ownership interests in subsidiaries
Acquisition of non-controlling interests - - - - - 83 83
Total changes in ownership interests in subsidiaries - - - - - 83 83
Total transactions with owners of the Company - - 262 (60,316) 60,054 (2,097) (62,151)
Balance at 31 March 2014 637,062 11,013 (11,854) 96,367 732,588 8,461 741,049
Notes to the abridged audited consolidated financial statements
Basis of preparation and accounting policies
Statement of compliance
The abridged audited consolidated financial information has been prepared in accordance with IAS 34
Interim Financial Reporting, as well as the AC 500 standards as issued by the Accounting Practices Board,
the requirements of the South African Companies Act, Act No.71 of 2008 and the Listings Requirements of
the JSE. The abridged audited consolidated financial statements do not include all of the information
required for full annual financial statements. The abridged audited consolidated financial statements have
been prepared in accordance with the historical cost basis except for certain financial instruments and
investment property which are stated at fair value. The abridged audited consolidated financial statements
are presented in Rand, rounded to the nearest thousand. The accounting policies applied in the presentation
of the abridged audited consolidated financial statements are in accordance with International Financial
Reporting Standards and are consistent with those presented in the previous annual financial statements.
The abridged audited consolidated financial statements have been extracted from audited information but
have not, in themselves, been audited. The audited financial statements are available for inspection at the
Company's registered office.
These abridged audited consolidated financial statements were prepared under the supervision of Michael
Buckham, CA (SA) CFA (Financial Director) and approved by the Board of Directors on 30 June 2014.
Restatement
The comparative period in the statement of profit or loss and other comprehensive income has been restated
as Prescient Asset Management Holdings (Ireland) ("Prescient Ireland") was reclassified as a discontinued
operation in terms of IFRS 5 Non-current Assets-Held-for-Sale and Discontinued Operations.
Judgements and estimates
Preparing the abridged audited consolidated financial statements requires management to make
judgements, estimates and assumptions that affect the application of accounting policies and the reported
amounts of assets and liabilities, income and expenses. Actual results may differ from these estimates.
In preparing these abridged audited consolidated financial statements significant judgements made by
management in applying the Group's accounting policies and key sources of estimation uncertainty were the
same as those that applied to the previous annual financial statements as at and for the year ended 31
March 2013.
Related party transactions
The Group entered into various inter-company transactions with related parties in the ordinary course of
business.
Subsequent events
There were no material events subsequent to the reporting date.
Review of operations
Results of continuing operations
Revenue for the group increased by 39% from R477.3 million in 2013 to R664.6 million in 2014. The
substantial increase in revenue was primarily attributable to the inclusion of 12 months of results for the PBT
Group in the current financial year whilst in the prior year the PBT Group was only consolidated for a period
of 7 months. The annualisation of the 7 months of revenue implies an increase in revenue of 10%.
Profit before tax for continuing operations of R152.2 million (2013: R137.5 million) was 10% higher than the
comparative from the previous year.
Basic earnings per share for continuing operations in 2014 was 7.15 cents per share (2013: 6.88 cents per
share). Headline earnings per share for continuing operations decreased slightly from 7.05 cents per share
to 6.96 cents per share. It is worth noting that the only adjustment between earnings per share and headline
earnings per share in 2013 and 2014 related to the revaluation of our property in Ireland. In 2013 the
property was valued downwards by €200,000 and with the recovery in the property market in Ireland in 2014,
the downward valuation of €200,000 was reversed.
Financial services
Revenue from Financial Services increased from R273.5 million to R287.1 million which represents an
increase of 5%. There was an increase in performance fees during the year, increased revenue from third party
administration clients and a strong performance from Prescient Securities however, this increase was muted as a result
of a lower average AUM for the year.
Information management services
The PBT Group of companies has changed its business definition from "IT services" to "Information
Management Services", which more accurately reflects the services offered in terms of the management of
clients' data and the application thereof. The latter includes master data, transformation, models, and
business analytics
A like-for-like revenue comparison with the previous financial year for the Information Management Services
segment of the company is difficult due to the fact that the prior year only included 7 months of operations.
The revenue for the 7 months in the prior year amounted to R203.8 million whilst it amounted to R377.5
million for the full reporting period. Segmental profit before tax for the year was R44.1 million
(2013: R24.7for 7 months).
The sale of Prescient Ireland
Prescient Holdings sold the entire issued share capital of Prescient Ireland, the stand-alone asset manager
with a mainly Irish client base, to J&E Davy, an Irish investment management and stockbroking firm. In terms
of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations, Prescient Ireland has been treated
as a discontinued operation during the current year. This has enhanced the ease of use of the financial
results as it has allowed users to assess the ongoing operations of the Group separately from Prescient
Ireland.
Dividend
A final gross dividend of 2.6 cents per share was declared by the directors on 30 June 2014. Combined with
the interim gross dividend paid to shareholders on 27 January 2014, the company distributed a total gross
dividend of 5.1 cents per share.
Biannually, the directors will consider the payment of a dividend, taking into account prevailing
circumstances and future cash and capital requirements of the Group in order to determine the appropriate
dividend in respect of a particular financial reporting period.
There are 1 598 022 450 shares in issue at the dividend declaration date, of which 26 411 114 are held as
treasury shares. The total dividend amount payable is R40.0 million (March 2013: R39.4 million).
This is a dividend as defined in the Income Tax Act, 1962, and is payable from income reserves. Dividends
declared after 31 March 2012, are no longer subject to the 10% Secondary Tax on Companies (STC)
regime, which levied the tax on the declaring company, but are now subject to a 15% Dividends Tax (DT)
which is a withholding tax levied on non-exempt shareholder recipients of the dividend. The net dividend
payable to shareholders who are subject to dividend tax is 2.21 cents per share, while it is 2.6 cents per
share to those shareholders who are exempt from dividend tax. Prescient's income tax reference number is
9725/148/71/3.
In compliance with the Listings Requirements of the JSE, the following dates are applicable:
Last day to trade cum dividend Friday, 25 July 2014
Shares trade ex dividend Monday, 28 July 2014
Record date Friday, 1 August 2014
Payment date Monday, 4 August 2014
Share certificates may not be dematerialised or rematerialised between Monday, 28 July 2014 and
Friday, 1 August 2014; both dates inclusive.
Posting of the Integrated Report and Notice of Annual General Meeting
The Integrated Report for the year ended 31 March 2014, including a Notice of the Annual General Meeting,
has been issued and posted to shareholders today and is available on the Company’s website at www.prescient.co.za.
The Annual General Meeting will be held at 11h00 on Tuesday, 5 August 2014, at Prescient House, Westlake Business Park,
Otto Close, Westlake, 7945.
The record date on which shareholders must be registered in the Company’s share register in order to attend, participate and
vote at the annual general meeting is Friday, 1 August 2014.
The last day to trade in order to be entitled to vote at the annual general meeting will therefore be Friday, 25 July 2014.
Forward-looking statements
This announcement contains certain forward-looking statements with respect to the financial condition and
results of the operations of Prescient Limited that, by their nature, involve risk and uncertainty because they
relate to events and depend on circumstances that may or may not occur in the future. These may relate to
future prospects, opportunities and strategies. If one or more of these risks materialise, or should underlying
assumptions prove incorrect, actual results may differ from those anticipated. By consequence, none of the
forward-looking statements have been reviewed or reported on by the Group's auditors.
Company information
Directors: AM Louw (Chairman), HC Steyn (CEO), M Buckham (Financial Director), M Kaplan (Lead
Independent non-executive), H Sonn (Independent non-executive), K Moloko (Independent non-executive),
Z Meyer (Independent non-executive), R van Rooyen (Non-executive)
There has been no change to the Board of Directors during the year under review.
Registered office: Prescient House, Westlake Business Park, Otto Close, Westlake, 7945, South Africa
Postal address: PO Box 31142, Tokai, 7966
Registration number: 1936/008278/06
Auditor: KPMG Inc.
Sponsor: Bridge Capital Advisors (Proprietary) Limited
Transfer secretaries: Link Market Services
JSE share code: PCT
ISIN: ZAE000163531
Website: www.prescient.co.za
Date: 30/06/2014 04:59:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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