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ISA - ISA Holdings Limited - Unaudited Results For The Six Months Ended 31
August 2008
ISA Holdings Limited
("ISA")
(Registration number: 1998/009608/06)
JSE share code: ISA
ISIN code: ZAE000067344
UNAUDITED RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2008
31-Aug-08 31-Aug-07 29-Feb-08
6 months 6 months Year
ended ended ended
Unaudited Unaudited Audited
R`000s R`000s R`000s
GROUP INCOME STATEMENT
Revenue 23,903 22,673 45,237
Cost of goods sold (12,814) (12,408) (23,896)
Gross profit 11,089 10,265 21,341
Other income 130 125 660
Operating expenses (4,975) (4,645) (10,917)
Operating profit 6,244 5,745 11,084
Finance income - net 1,558 1,400 2,852
Profit before tax 7,802 7,145 13,936
Tax (2,895) (2,503) (4,277)
Profit attributable to shareholders 4,907 4,642 9,659
GROUP BALANCE SHEET
ASSETS
Non-current assets 7,958 7,585 8,005
- Tangible assets 439 528 495
- Intangible assets 7,366 6,367 7,004
- Share trust 35 247 211
- Deferred tax 118 443 295
Current assets 44,626 42,592 49,453
- Cash and cash equivalents 33,074 35,403 34,153
- Equity investments 4,759 - 4,811
- Inventories 29 46 74
- Trade and other receivables 6,764 7,143 10,415
Total assets 52,584 50,177 57,458
EQUITY
Equity capital and reserves 37,362 37,066 42,084
- Share capital and share premium 24,090 30,060 30,060
- Non-distributable reserve 3,021 3,021 3,021
- Retained earnings 10,251 3,985 9,003
LIABILITIES
Long term liabilities 3,111 2,805 2,943
- Loan 3,084 2,768 2,916
- Deferred tax 27 37 27
Current liabilities 12,111 10,306 12,401
- Trade and other payables 10,249 7,783 8,480
- Receiver of Revenue 1,467 2,139 3,691
- Provisions 395 384 230
Total equity and liabilities 52,584 50,177 57,428
CASH FLOW STATEMENT
Cash flows from operating activities 12,433 5,253 8,669
Cash flows from investing activities 176 1,747 (3,069)
Cash flows from financing activities (13,688) (9,505) (9,355)
Net increase(decrease) in cash (1,079) (2,505) (3,755)
and cash equivalents
Cash and cash equivalents at 34,153 37,908 37,908
beginning of the period
Cash and cash equivalents at end 33,074 35,403 34,153
of the period
GROUP STATEMENT OF CHANGES IN EQUITY
Share capital and reserves
Balance at beginning of the period 42,084 42,054 42,054
Attributable profit for the period 4,907 4,642 9,659
Repayment of share premium (5,970) (7,511) (7,511)
during the period
Dividends paid during the period (3,659) (2,119) (2,118)
Total equity capital and reserves 37,362 37 066 42,084
RECONCILIATION OF HEADLINE EARNINGS
Earnings as per income statement 4,907 4,642 9,659
Capital profit on disposal - (125) (166)
of investment
Headline earnings 4,907 4,517 9,493
ORDINARY SHARES
Earnings per share (cents) 2.5 2.4 5.0
Headline earnings per share (cents) 2.5 2.3 4.9
Number of shares in issue at end 192,593 192,593 192,593
of period (`000s)
Net asset value per share at end 19.4 19.2 21.9
of period (cents)
Net tangible asset value per share 15.6 15.9 18.2
at end of period (cents)
The board is pleased to report that they have successfully met their key
performance indicators during the six months under review.
Steady growth in revenue of 5% has been translated into increased earnings and
headline earnings to 2.5 cents per share. The quality of earnings further
improved during the period with an 18% growth in service-based income over last
year`s comparative period. Annuity-based revenue remained constant at 60%.
Despite the outflow of cash due to the payment of the 5.0 cents per share
distribution to shareholders, a closing cash position of 17.2 cents per share
was achieved. The composition of these cash reserves improved during this period
to include 15% in major foreign currencies. The intention of this currency
spread is to minimise ISA`s exposure to a weakening Rand.
The local skills shortage experienced over the last few reporting cycles
continues to concern management. Extending their reach into the international
resource pool should ease the short term pressure on the income statement going
forward, but this may negatively affect their medium term transformation
objectives. An appropriate balance will be sought in the months ahead.
DIVIDENDS
The board has not declared an interim dividend.
PROSPECTS
The level of macro-economic uncertainty has increased over the last few months,
creating a challenging trading climate for ISA. With this said, we anticipate
that the drivers for growth in the information security industry will remain
robust.
ISA is in a strong position to leverage opportunities for strategic investments
presented by the current market conditions.
BASIS OF PREPARATION
These consolidated condensed financial statements are prepared in accordance
with the Listings Requirements of the JSE Limited, the International Financial
Reporting Standards (IFRS) on Interim Financial Reporting (IAS34) and Schedule 4
of the South African Companies Act. The accounting policies are consistent with
those used in the annual financial statements for the year ended 29 February
2008. These results have not been reviewed by the current auditors and represent
the unaudited Interim Results for the Group.
SPECIAL THANKS
I take this opportunity to thank all of our stakeholders, especially our
management team and staff, for being dedicated and committed to the business.
Special thanks to our former Financial Director, Ryan Price, for his hard work
over the years.
For and on behalf of the board.
Clifford Katz
Chief Executive Officer
3 November 2008
Designated Advisor: Grindrod Bank Limited
Date: 03/11/2008 15:13:07 Supplied by www.sharenet.co.za
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