To view the PDF file, sign up for a MySharenet subscription.

RGT - RGT Smart Market Intelligence Limited - Audited results for the year ended

Release Date: 24/05/2012 11:00
Code(s): RGT
Wrap Text

RGT - RGT Smart Market Intelligence Limited - Audited results for the year ended 29 February 2012 and notice of Annual General Meeting RGT SMART MARKET INTELLIGENCE LIMITED (Incorporated in the Republic of South Africa) (Registration number: 2008/014367/06) Share Code: RGT ISIN: ZAE000143715 ("RGT SMART" or "the Company") AUDITED RESULTS FOR THE YEAR ENDED 29 FEBRUARY 2012 AND NOTICE OF ANNUAL GENERAL MEETING The audited results of RGT SMART for the year ended 29 February 2012, as compared to the year ended 28 February 2011, are presented below: Financial Performance Highlights Highlights for the period March 2011 to February 2012, are as follows: Feb 2012 Feb 2011 Revenue 32 369 732 27 703 937 16.8% Total Costs 27 416 502 23 066 083 18.9% Profit Before Tax 5 319 814 4 755 811 11.9% Profit After Tax 4 123 318 3 306 470 24.7% Headline Earnings 4 214 390 3 275 476 28.7% Headline Earnings per 0.8429 0.8287 1.7% share Condensed consolidated statement of Financial Position Figures in Rand Audited Audited 29 February 2012 28 February 2011 R`000 R`000 Assets NonCurrent Assets Property, plant and equipment 2 435 748 Goodwill 17 449 17 449 Intangible assets 5 907 5 586 Deferred tax 328 238 Current Assets Current tax receivable 530 1 Operating lease asset 149 - Trade and other receivables 2 967 2 931 Cash and cash equivalents 9 880 1 420
Total Assets 39 645 28 373 Equity and Liabilities Equity Share capital 13 271 4 024 Retained earnings 18 954 14 080 Total Equity 32 225 18 104 Liabilities Non-Current Liabilities Loans from shareholders - 1 365 Other financial liabilities 1 094 - Operating lease liability 564 - Deferred tax 1 655 1 421
Current Liabilities Loans from shareholders - 978 Other financial liabilities 271 2 470 Current tax payable 103 1 Operating lease liability - 31 Trade and other payables 2 301 2 480 Revenue received in advance 1 300 1 336 Provisions 132 187 Total Liabilities 7 420 10 269 Total Equity and Liabilities 39 645 28 373 Figures in Rand Audited Audited 29 February 28 February 2012 2011
Asset value per share (cents per 7.93 7.09 share) Tangible asset value per share 3.26 1.33 (cents per share) Number of shares in issue at year 500 000 400 018 end (`000) Condensed consolidated statement of comprehensive income Figures in Rand Audited Audited 29 February 28 February 2012 2011 R`000 R`000
Revenue 32 370 27 704 Cost of sales (6 350) (7 195) Gross profit 26 020 20 509 Other income 32 61 Operating expenses (20 811) (15 392) Operating profit before interest 5 241 5 178 Investment revenue 334 57 Finance costs (255) (479) Profit before taxation 5 320 4 756 Taxation (1 197) (1 450) Profit after taxation 4 123 3 306
Profit for the year 4 123 3 306 Attributable to: Equity holders of the parent 4 123 3 306 Minority interest - - Profit for the year 4 123 3 306 Headline earnings reconciliation 4 123 3 306 (R`000) Profit attributable to owners of the parent Adjusted for: Loss/(Profit) on disposal of property, 91 (31) plant and equipment Headline earnings for the period 4 214 3 275 Figures in Rand Audited Audited 29 February 28 February 2011
2012 Per share information Headline earnings per share (cents) 0.84 0.83 Diluted headline earnings per share 0.84 0.72 (cents) Basic earnings per share (cents per share) 0.82 0.84 Diluted earnings per share (cents per share) 0.82 0.72 Dividend per share (cents) - - Weighted average number of shares in 500 000 395 268 issue (`000) Condensed consolidated statement of cash flows Figures in Rand Audited Audited 29 February 28 February 2012 2011
R R Cash generated from operating activities 5 228 017 3 699 209 Cash used in investing activities (3 317 618) (2 031 418) Cash generated from/(used in) financing 6 549 125 (194 534) activities Total cash movement for the year 8 459 524 1 473 257 Cash at the beginning of the year 1 420 396 (52 861) Total cash at end of the year 9 879 920 1 420 396 Condensed consolidated statement of changes in equity Figures in Rand Share Share Equity Total share capital premium reserve capital
Balance at 01 March 2010 3 808 001 35 480 303 (37 498 902) 1 789 402 Changes in equity Profit for the year - - - - Issue of shares in terms of the initial public offering 569 999 5 130 001 - 5 700 000 Transfer share issue costs to share premium - (438 131) - (438 131)
Treasury shares held by subsidiary (377 817) (2 649 363) - (3 027 180) Total changes 192 182 2 042 507 - 2 234 689 Balance at 01 March 2011 4 000 183 37 522 810 (37 498 902) 4 024 091 Changes in equity Profit for the year - - - - Issue of shares 622 000 5 598 000 - 6 220 000 Treasury shares sold 377 817 2 649 363 - 3 027 180 Total changes 999 817 8 247 363 - 9 247 180 Balance at 29 February 5 000 000 45 770 173 (37 498 902) 13 271 270 2012 Condensed consolidated statement of changes in equity Figures in Rand Retained earnings Total equity Balance at 01 March 2010 10 773 347 12 562 749 Changes in equity Profit for the year 3 306 470 3 306 470 Issue of shares in terms of the initial public offering - 5 700 000 Transfer share issue costs to share premium - (438 131) Treasury shares held by subsidiary - (3 027 180) Total changes 3 306 470 5 541 159 Balance at 01 March 2011 14 079 817 18 103 908 Changes in equity Profit for the year 4 123 318 4 123 318 Issue of shares - 6 220 000 Treasury shares sold 750 990 3 778 170 Total changes 4 874 308 14 121 488 Balance at 29 February 2012 18 954 125 32 225 395 BASIS OF PREPARATION The board of directors is pleased to present the company`s audited results for the year ended 29 February 2012, which have been approved by the board on 23 May 2012. The accounting policies adopted for purposes of this report comply, and have been consistently applied in all material respects with International Financial Reporting Standards ("IFRS") and the abridged financial statements have been prepared in accordance with the requirements of IAS 34 (Interim Financial Reporting). The same accounting policies and methods of computation have been followed as compared to the prior year. The results have been audited by Mazars and the unqualified and unmodified audit report is available for inspection at the Company`s registered office. 1 INDUSTRY AND BUSINESS OVERVIEW RGT SMART Market Intelligence Limited (RGT SMART) is an investment holding company that currently operates two wholly owned subsidiaries, Republic Computer Services (Pty) Ltd (Trading as Response Group Trendline or RGT) and RGT Smart Operations (Pty) Ltd (formerly KA SMART)(RGT Ops). RGT has been the sole source of new vehicles sales data to the SA motor industry for over 25 years. In addition RGT provide a range of analytical products which the motor industry uses in planning, forecasting and marketing. RGT Ops (previously known as KA SMART) provides high value consulting support and service quality management and monitoring systems. During the year under review as part of a strategy to simplify administration and unify our branding operational companies within the RGT SMART Group were amalgamated under one trading company; RGT Smart Operations (Pty) Ltd, (formerly KA SMART Management Consultants (Pty) Ltd). This move greatly simplifies administration and accounting and will reduce administrative costs in the coming years. Additionally a more unified approach to branding and brand development will make marketing more effective. Details of the product offerings of the Company are as follows: MOTOR INDUSTRY DATA AND ANALYTICAL SYSTEMS AutoStats - Online subscription based service providing detailed motor industry Sales Volumes Vehicle Specifications, Dealer Promotions and Economic statistics. AutoMSA - Sophisticated Motor Industry Market Segmentation and Analysis Tool with customised subscription based online access. Parts Pricing Analyser - An analysis and reporting system that provides live, real-time comparative pricing for parts used in Passenger and LCV sold in South Africa. Smart Mapping - Google supported Online Mapping System for Geo-Spatial analysis of data. Greenfleet - Analysis and Management of Vehicle Fleet Carbon Emissions. National Labour Rate Monitor - Interactive Online reporting that allows subscribers to accurately monitor and track Retail. Service and Warranty labour rates by region, city, and manufacturer. MARKET RESEARCH Qualitative - RGT SMART has experience in the entire qualitative research process. Scope of operations initial conceptualisation of the research project design, data collection instruments, analysis and interpretation of the data. Quantitative - Data collection methods include Online, Email, SMS, Computer Aided Telephonic, Face to Face while world class systems efficiently facilitate research project management and analysis. Service Quality Systems - An approach that delivers real-time consistent and accurate measurement of the customer experience and at the same time provides corrective action and improvement support. CONSULTING SUPPORT Strategic Planning RGT SMART incorporates all of the acquired knowledge over the years to provide a consultative approach to each and every project. We believe Strategic planning is a management tool for organizing the present on the basis of the projections of the desired future. Product Planning and New Product Development/ Distribution Strategies High level decision support for new product entries into a variety of markets by utilising experience, statistics and a variety of research methodologies. Training and Knowledge Transfer - Qualified facilitators present a variety of courses supporting the RGT SMART product suite. Training courses are customised to meet client specifications and will empower clients to conduct analysis independently. INDUSTRY MONITORS Motor Industry & Market Forecasts - Industry insight coupled with base data and high level statistical expertise provides a range of forecasting services. Business Confidence Indicators - On-going monthly, quarterly, bi-annual and annual Research Reports and Analysis. 2 FINANCIAL RESULTS The Company`s focus was on sustainable growth and because this required re- investment, conservative, measured and reasonable levels of profitability were expected. Even with substantial investment and reduction of debt growth in turnover and profit terms exceeded expectations. Revenue is up by 16.8%,total costs are up by 18.9%, headline earnings is up by 28.7% and HEPS up by 1.7%. The group generated R5.2m of cash from operations. The sale of treasury shares together with the issue of additional shares generated a further R10m. Loans and other financial liabilities totalling R3.4m were repaid. The group reflected a positive cash flow of R8.5m in the period under review. In 2011 the Company successfully introduced performance oriented KPAs and KPIs for all employees and performance linked incentives for senior staff. A priority objective was to secure an investor of reference to acquire a significant stake in the business, thereby raising additional working capital. This was realised early in the year with the successful conclusion of a subscription agreement on 01 March 2011 with H.L. Hall and Sons Investments (Proprietary) Limited ("Halls") through one of its subsidiaries, Lightstone, acquiring a total of 215 512 128 shares in RGT SMART, through the issue of 62 200 000 unissued ordinary shares, the purchase of 37 781 700 treasury shares and the purchase of 115 530 428 shares from some existing shareholders. 3 SEGMENTAL REPORTING The Group has adopted IFRS 8 Operating Segments as its segmental reporting standard which requires an entity to report financial and descriptive information about its reportable segments, which are operating segments or the aggregation of operating segments that meet specified criteria. Operating segments are components of an entity in respect of which separate financial information is available is evaluated regularly by management. For management purposes, the Group is organised into the following segments: For the year ended 29 February Market research Statistics 2012
External revenue 14 843 828 17 520 204 Internal revenue - 50 794 Total revenue 14 843 828 17 570 998 Cost of sales (3 972 179) (2 428 896) Personnel costs (4 177 265) (5 194 100) Lease rentals (755 301) (533 013) Other costs (4 899 161) (3 776 967) EBITDA 1 039 922 5 638 022 Depreciation and amortization (765 653) (372 055) Finance income 418 3 108 Finance costs (14 427) (292 664) Profit before tax 260 260 4 976 411 Segment assets 7 750 177 24 668 617 Total for All other Elimination of Total RGT reportable segments intersegment SMART
segments transactions External revenue 32 364 032 5 700 - 32 369 732 Internal revenue 50 794 6 120 000 (6 170 794) - Total revenue 32 414 826 6 125 700 (6 170 794) 32 369 732 Cost of sales (6 401 075) - 50 794 (6 350 281) Personnel (9 371 365) (4 022 - (13 393 962) costs 597) Lease rentals (1 288 314) - - (1 288 318) Other costs (8 676 129) (2 357 6 120 000 (4 914 057) 928) EBITDA 6 677 943 (254 825) - 6 423 118 Depreciation and (1 137 708) (44 843) - (1 182 551) amortization Finance income 3 526 599 467 (268 982) 334 015 Finance costs (307 091) (216 659) 268 982 (254 768) Profit before tax 5 236 670 83 140 - 5 319 814 Segment assets 32 418 794 7 225 826 - 39 644 620 The "Market Research" segment provides specialist market research, market intelligence and consulting services focusing on the South African motor industry. The "Statistics" segment, is the source of new vehicle sales data to the South African motor industry. It also provides new vehicle specification and pricing data and has developed sophisticated suite of analytical systems. The revenue derived by all other segments is in the form of management fees paid by the two operating subsidiaries. Geographical information has not been presented as the company operates in South Africa only. Revenue from external customers for each product and service, or each group of similar products and services has not been presented, as the information is not available and the cost to develop it would be excessive. The Group does not earn revenue in excess of 10% from one single customer, and as such does not place reliance on a single customer or group of customer for its continued existence. 4 ACQUISITIONS AND DISPOSALS On 01 March 2011 RGT SMART issued a further 62 200 000 share for cash. The entire authorised share capital of 500 000 000 shares has therefore been issued. The 37 781 700 treasury shares were disposed of for cash on 1 March 2011. 5 DIRECTOR CHANGES During the year under review, the following director changes took place: Director Date appointed AH Miller 1 June 2011 SG Pretorius 1 March 2011 Subsequent to the year end, the following director change occurred: Director Date appointed P Backwell 27 March 2012 The board of directors is now constituted as follows: Director Date appointed Designation AA da Costa 12 June 2008 Independent Non- executive Chairman
PB De Vantier 12 June 2008 Chief Executive Officer NS Bruton 12 June 2008 Executive Director CW Reed 12 June 2008 Financial Director CJ Moodliar 05 May 2010 Independent Non- executive director TB Hayter 03 September 2010 Independent Non- executive director SG Pretorius 01 March 2011 Independent Non- executive director AH Miller 01 June 2011 Non-executive director P Backwell 27 March 2012 Non-executive director
6 SHARE CAPITAL On 1 March 2011, the remaining unissued 62 200 000 shares were issued to Lighstone. The 37 781 700 treasury shares were also sold to Lightstone. As at 29 February 2012, there were 500 000 000 issued ordinary shares, which total the authorised number of shares available and accordingly there are no unissued ordinary shares. 7 REPURCHASE AND ISSUES OF SHARES During the year under review, the Company did not repurchase any shares. 8 DIVIDEND The Company does not have a formal dividend policy at present. The Board of Directors will continue to consider the payment of dividends on an annual basis, based on achievement of profit and cash flow requirements. The Company has not determined any fixed dates on which dividends or entitlement to dividends arises. There is no arrangement in which future dividends are waived or agreed to be waived. 9 LITIGATION There is no litigation pending against the company or its subsidiaries, which is expected to have a material impact on the results of the Company. 10 CONTINGENT LIABILITIES At the balance sheet date the Group does not have any contingent liabilities (2011: RNil). 11 ANNUAL GENERAL MEETING Shareholders are advised that the Annual General Meeting of the Company will be held on Wednesday, 22 August 2012 at IQuad House, 56 Mangold Street, Newton Park, Port Elizabeth at 09h00. 12 SUBSEQUENT EVENTS On 1 March 2012 the operations of RGT were merged with those of RGT Ops (previously KA Smart). The merger had no effect on the Group as both entities are wholly owned subsidiaries. There were no other significant subsequent events. 13 FUTURE PROSPECTS There are no major shifts in strategic direction; the group is confidently committed to the existing strategy and business model. RGT SMART will continue to play to its strengths - there continues to be scope for growth in the Automotive Industry. RGT SMART`s role will be to continue to contribute to the resolution of our clients` real business problems, enhancing their decision making through deep industry insights and smart analytics using sets of propriety data. A key objective for the coming year is to actively work with Lightstone and other sister companies to generate mutually beneficial turnover through synergies that can be created and exploited. There are already a number of initiatives being explored in this regard. Regarding product development; the focus will continue to be on projects designed and structured to provide recurring income. In the coming year continued recruitment of top specialists and increased investment in training and development will remain a priority but now that the business is properly structured, streamlined and funded RGT SMART will begin to turn attention to potential acquisitions. Importantly though it will remain essential that prospective acquisitions add to the data set, skills and expertise and fit the RGT SMART business model. Additionally the directors are actively exploring opportunities to launch RGT SMART products and services in targeted offshore markets. Longer range development planning for senior executive positions will be focused on creating business growth and opportunity development capacity as well as ensuring continuity. By order of the Board Mr AA Da Costa Mr PB De Vantier Chairman Chief Executive Officer 24 May 2012 Johannesburg Registered Office Arcay House, Number 3 Anerley Road, Parktown, Johannesburg, 2193 PO Box 62397, Marshalltown, 2107 Directors AA Da Costa*#(Chairman), PB De Vantier(CEO), CW Reed (FD)(Preparer), NS Bruton, CJ Moodliar*#, TB Hayter*#, SG Pretorius*#, AH Miller*, P Backwell* * Non-executive, #Independent Designated Advisor Transfer Office Arcay Moela Sponsors (Proprietary) Limited Link Market Services (Proprietary) Limited Date: 24/05/2012 11:00:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.

Share This Story