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TLM - Telemasters Holdings Limited - Unaudited condensed consolidated interim
results for the three month period ended 31 December 2010
TELEMASTERS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2006/015734/06)
Share code: TLM & ISIN Number: ZAE000093324
("TeleMasters" or "the Company")
UNAUDITED CONDENSED CONSOLIDATED INTERIM RESULTS FOR THE THREE MONTH
PERIOD ENDED 31 DECEMBER 2010
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
Unaudited Unaudited
3 months 3 months
ended ended 31
31 December December
2010 2009
R R
Revenue 86 230 570 62 927 890
Cost of sales (72 991 796) (52 833
132)
Gross profit 13 328 774 10 094 758
Operating expenses (8 171 761) (5 415 624)
Operating profit 5 067 013 4 679 133
Investment income 212 368 199 602
Finance costs (91 619) (136 899)
Profit before taxation 5 187 762 4 741 837
Taxation (1 807 444) (1 561 292)
Profit for the period 3 380 318 3 180 545
Total comprehensive income for the period 3 380 318 3 180 545
Basic earnings per share (cents) 8.05 7.57
Diluted earnings per share (cents) 8.05 7.57
Headline earnings reconciliation:
Profit for the period 4 880 318 3 180 545
Adjustments: Profit on disposal of (19 315) -
property, plant and equipment
Headline earnings for the period 4 861 003 3 180 545
Headline earnings per share (cents) 8.00 7.57
Diluted headline earnings per share 8.00 7.57
(cents)
Weighted average shares in issue (`000) 42 000 000 42 000 000
Dividends declared per share (cents) 4.0 4.0
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION
Unaudited at Audited
at
31 December 30
2010 September
2010
R R
ASSETS
Non-current assets
Property, plant and equipment 16 319 515 16 600
971
Intangible assets 2 603 494 2 842 631
Goodwill 2 686 779 2 686 779
Deferred tax assets 4 283 830 3 860 944
Total non-current assets 25 893 618 25 991
325
Current assets
Trade and other receivables 28 704 268 18 726
561
Cash and cash equivalents 21 650 169 20 144
204
Total current assets 50 354 437 38 870
765
Total assets 76 248 055 64 862
090
EQUITY AND LIABILITIES
Capital and reserves
Issued capital 48 059 48 059
Retained earnings 31 719 642 30 019
324
Total equity 31 767 701 30 067
383
Non-current liabilities
Finance lease liabilities 1 720 031 2 096 728
Total non-current liabilities 1 720 031 2 096 728
Current liabilities
Trade and other payables 36 734 656 26 438
205
Current portion of finance lease liabilities 2 481 140 2 426 455
Current tax payable 1 773 005 2 044 085
Shareholders for dividend 1 691 881 1 717 055
Bank overdraft 79 641 72 179
Total current liabilities 42 760 323 32 697
979
Total liabilities 44 480 354 34 794
707
Total equity and liabilities 76 248 055 64 862
090
Number of shares in issue 42 000 000 42 000
000
Net asset value per share (cents) 75. 64 71.59
Net tangible asset value per share (cents) 63.04 58.42
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Unaudited Unaudited
at at
31 December 31 December
2010 2009
R R
Cash flows from operating activities
Cash generated from operations 6 633 532 13 777 968
Finance costs (91 619) (136 899)
Tax paid (2 501 409) (5 617 208)
Net cash inflow from operating activities 4 040 504 8 023 861
Cash flows from investing activities
Property, plant and equipment acquired (746 496) (1 020 579)
Proceeds on sale of property, plant and 19 315 -
equipment
Investment income 212 368 199 602
Net cash outflow from investing activities (514 813) (820 977)
Cash flows from financing activities
Instalment sale agreements obtained 251 994 810 167
Dividends paid (1 705 174) (1 681 152)
Repayment of instalment sale agreements (574 008) (519 885)
Net cash outflow from financing activities (2 027 188) (1 390 870)
Net increase in cash and cash equivalents 1 498 503 5 812 014
Cash and cash equivalents at the beginning 20 072 025 16 165 680
of the period
Cash and cash equivalents at the end of the 21 570 528 21 977 694
period
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued Share Total share Retained Total
capital premium Capital Income Equity
Balance at 30 4 200 2 143 859 2 148 059 25 984 967 28 133 026
September
2009
Profit for - - - 3 180 545 3 180 545
the period
ended 31
December 2009
Dividends - - - (1 680 000) (1 680 000)
declared
Balance at 31 4 200 2 143 859 2 148 059 27 485 512 29 633 571
December 2009
Profit for - - - 4 633 813 4 633 813
the period
ended 30
September
2010
Dividends - - - (2 100 000) (2 100 000)
declared
Capital - (2 100 000) (2 100 000) - (2 100 000)
distributions
Balance at 30 4 200 43 859 48 059 30 019 324 30 067 383
September
2010
Profit for - - - 3 380 318 3 380 318
the period
ended 31
December 2010
Dividends - - - (1 680 000) (1 680 000)
declared
Balance at 31 4 200 43 859 48 059 31 719 642 31 767 701
December 2010
SEGMENT REPORT
The Company does not have different operating segments. The business is
conducted in South Africa and is managed centrally with no branches.
The company is managed as one operating unit. Accordingly there is no
meaningful segmental information to report other than the following
information:
Unaudited Unaudited
3 Months ended 31 3 Months ended 31
December 2010 December 2009
R R
Revenue by Nature
Sale of airtime 86 165 875 56 827 737
Connection incentive bonuses 5 150 4 521 487
Other 59 545 1 578 666
Total revenue 86 230 570 62 927 890
Major customers
Revenues from transactions
with a single external
customer amounting to 10
percent or more of the
Company`s revenue, are
disclosed below:
- Customer A 10 017 726 14 468 120
- Customer B 27 135 058 -
- Other customers 49 077 786 48 459 770
Total revenue 86 230 570 62 927 890
1. COMPANY PROFILE
TeleMasters is a specialist tele-management and business communication strategy
player operating exclusively in the South African market focussing on the
corporate market. The company provides current and future clients access to the
most efficient and effective telecommunication technologies.
2. FINANCIAL RESULTS
2.1 Statement of compliance and basis of preparation
The interim financial statements for the three months ended 31 December 2010
have been presented in accordance with the framework concepts and the
measurement and recognition requirements of International Financial Reporting
Standards, the information required by IAS 34: Interim Financial Reporting, the
South African Companies Act, as amended, the AC500 Standards as issued by the
Accounting Practices Board and the JSE Listings Requirements. The results have
been prepared in accordance with accounting policies of the Company that are
consistent with those applied in the audited annual financial statements for the
year ended 30 September 2010. These results have not been reviewed or audited by
the Company`s auditors.
2.2 Significant items included in results
New customer contract
The Company concluded a new, temporary contract with Customer B in October 2010,
which runs on a month-to-month basis. During the quarter under review, revenue
earned from this customer under the said contract totalled R27 135 058.
2.3. Dividends
On 22 December 2010 the board has declared a quarterly interim dividend of 4
cents per share, which was paid to all shareholders recorded in the share
register of the Company at the close of business on Friday, 21 January 2011. On
1 April 2011 the board has declared another quarterly interim dividend of 4
cents per share, which was paid to all shareholders recorded in the share
register of the Company at the close of business on Friday 29 April 2011.
During the first quarter of the prior financial year, which ended on 31 December
2009, the Company declared an interim dividend of 4 cents per share for that
quarter.
The board will continue with the policy of declaring quarterly dividends.
2.4. Related party transactions
The following material transactions with related parties occurred during the
quarter under review:
Unaudited Unaudited
3 Months 3 Months
ended 31 ended 31
December December 2009
2010
R R
Sales to related parties
TeleMasters (Pty) Ltd 14 681 280 16 493 657
Purchases from related parties
TeleMasters (Pty) Ltd 899 526 1 471 293
Unaudited at Audited at
31 December 30 September
2010 2010
R R
Balances owing by related parties
included in
Trade and other receivables
TeleMasters (Pty) Ltd 6 171 509 6 423 301
Balances owing to related parties
included in
Trade and other payables
TeleMasters (Pty) Ltd 557 333 176 167
2.5. Acquisition of property, plant and equipment
Property, plant and equipment acquired during the quarter comprise various items
of Furniture and fittings, Motor vehicles, Office equipment, IT equipment and
Routers and handsets.
3. SUBSEQUENT EVENTS
The directors are not aware of any matter or circumstance arising since the
reporting date which would have a material effect on the consolidated results or
the consolidated financial position of the Company as reported.
4. CHANGES IN THE COMPOSITION OF THE BOARD
On 24 December 2010 Ms Nolene Owen resigned as Financial Director. As an
interim measure, the role of Mr Brandon Topham changed from non-executive
director to Financial Director on this same date. On 17 May 2011 Ms Erika
Rossouw was appointed as Financial Director and accordingly, the role of Mr
Brandon Topham changed back to non-executive director on that date.
5. SECOND QUARTER RESULTS
Unaudited condensed consolidated interim results for the second quarter and six
months ended 31 March 2011 will be announced on or before Friday 24 June 2011.
For and on behalf of the Board:
MB Pretorius E Rossouw
Chief Executive Officer Financial Director
13 June 2011
Corporate information
Directors: DS van Der Merwe*#, J Voigt*, VI Beck*#, MB Pretorius, BR Topham, E
Rossouw
(* non-executive, # independent)
Registered address: 90 Regency Drive, Route 21 Corporate Office Park, Irene,
0157, Pretoria (P.O. Box 68255, Highveld Park, 0169)
Company secretary: Brandon Topham Inc.
Auditors: BDO South Africa Inc., Block C, Riverwalk Office Park, 41 Matroosberg
Avenue, Ashlea Gardens, Pretoria
Transfer secretaries: Computershare Investor Services (Proprietary) Limited, 70
Marshall Street, Johannesburg, 2001 (P.O. Box 61051, Marshalltown, 2107)
Designated Advisor: Arcay Moela Sponsors (Proprietary) Limited
Website: www.telemasters.co.za
Date: 13/06/2011 09:00:01 Supplied by www.sharenet.co.za
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