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PINNACLE HOLDINGS LTD - Unaudited interim results for the six months ended 31 December 2013

Release Date: 07/03/2014 08:00
Code(s): PNC     PDF:  
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Unaudited interim results for the six months ended 31 December 2013

PINNACLE HOLDINGS LIMITED
(previously Pinnacle Technology Holdings Limited)
(Registration number 1986/000334/06)
Share code: PNC
ISIN: ZAE000184149
(“Pinnacle” or “the Group” or “the Company”)
www.pinnacleholdings.co.za
UNAUDITED INTERIM RESULTS for the six months ended 31 December 
2013
HIGHLIGHTS
– REVENUE up 1.1% to R3.2 billion
– EBITDA up 1.7% to R232 million
– NPAT up 9.0% to R162 million
– HEPS up 1.7% to 95.4 cents
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
Revenue                    3 160 872    3 126 104    6 596 232
Cost of sales             (2 645 963)  (2 638 635)  (5 566 701)
Gross profit                 514 909      487 469    1 029 531
Operating expenses          (282 366)    (258 834)    (536 277)
Selling expenses             (26 179)     (21 245)     (34 417)
Employee expenses           (228 424)    (200 394)    (421 614)
Administration               (38 068)     (42 613)     (90 734)
Gain on discounting of 
 finance lease agreements        298            7          382
Profit on foreign exchange     5 661        5 411       10 106
Reclassification of fair 
 value adjustment on 
 derecognition of asset        4 346            –            –
EBITDA *                     232 543      228 635      493 254
Depreciation and 
 amortisation                 (8 784)      (9 167)     (20 753)
Operating profit before 
 interest                    223 759      219 468      472 501
Net finance costs             (6 851)     (10 112)     (18 558)
Investment income             32 322       22 454       58 548
Interest paid                (39 173)     (32 566)     (77 106)
Share of equity accounted
  associate income             4 776            –            –
Profit before taxation       221 684      209 356      453 943
Taxation                     (59 412)     (60 460)    (128 263)
Net profit for the period    162 272      148 896      325 680
Owners of the Company        162 146      148 190      324 948
Non-controlling interests        126          706          732
Other comprehensive income
Exchange differences from 
 translating foreign 
 operations                    1 019          236        1 060
Total comprehensive income 
  for the period             163 291      149 132      326 740
Attributable to:
Owners of the Company        163 165      148 426      326 008
Non-controlling interests        126          706          732
RECONCILIATION OF HEADLINE EARNINGS
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
Net profit for the period 
 attributable to ordinary 
 shareholders                162 146      148 190      324 948
Reclassification of 
 fair value adjustment on 
 derecognition of asset 
 after taxation               (3 738)           –            –
Reclassification of fair 
 value adjustment on 
 derecognition of asset       (4 346)           –            –
Less: Taxation thereon           608            –            –
Profit on sale of property, 
 plant and equipment net 
 of taxation                  (7 592)         (91)        (314)
Profit on sale of property, 
 plant and equipment         (10 545)        (126)        (436)
Less: Taxation thereon         2 953           35          122
Headline earnings            150 816      148 099      324 634
Total number of shares in
  issue (‘000)
– Total issued less 
   treasury shares           158 034      157 898      157 889
– Weighted average           158 031      157 890      157 931
– Fully diluted              158 095      157 890      157 931
* Earnings before interest, taxation, depreciation and 
amortisation.
FINANCIAL REVIEW
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
Performance per 
 share (cents)
Earnings (normal)              102.6         93.9        205.8
Earnings (fully diluted)       102.6         93.9        205.8
Headline earnings (normal)      95.4         93.8        205.6
Headline earnings 
 (fully diluted)                95.4         93.8        205.6
Dividends                          –            –         41.0
Dividend cover (times)             –            –          5.0
Returns (%)
Gross profit                    16.3         15.6         15.6
Operating expenses              (8.9)        (8.3)        (8.1)
EBITDA *                         7.4          7.3          7.5
Operating profit before 
 interest and taxation           7.1          7.0          7.2
Effective tax rate              26.8         28.9         28.3
Net profit                       5.1          4.8          4.9
SEGMENTAL ANALYSIS
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
Revenue
ICT Distribution           3 107 330    3 050 236    6 461 101
IT Projects and Services      94 788       68 027      161 722
Financial Services            49 818       30 195       73 113
Group Central Services           493            –            –
Less: Interest received and
 discounted leases within
 Financial Services revenue 
 above                       (28 772)     (14 021)     (39 417)
Less: Intergroup revenue     (62 785)      (8 333)     (60 287)
                           3 160 872    3 126 104    6 596 232
Net profit before taxation 
ICT Distribution             191 435      194 555      418 089
IT Projects and Services      11 807        8 619       17 867
Financial Services            16 528        9 521       22 274
Group Central Services         1 914       (3 339)      (4 287)
                             221 684      209 356      453 943
Net profit after taxation 
ICT Distribution             141 048      138 895      303 806
IT Projects and Services       8 424        6 518       11 912
Financial Services            11 899        7 143       15 902
Group Central Services           901       (3 660)      (5 940)
                             162 272      148 896      325 680
Net operating assets
ICT Distribution             794 641      623 138      782 990
IT Projects and Services      20 089       22 451       26 879
Financial Services            46 423       25 351       34 323
Group Central Services       321 604      234 062      243 867
                           1 182 757      905 002    1 088 059
GROUP CONSOLIDATED STATEMENT OF FINANCIAL POSITION
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
ASSETS
Non-current assets           912 063      491 332      594 636
Property, plant and 
 equipment                   209 205      168 292      186 637
Intangible assets            131 107       97 782      129 117
Investments in listed shares       –            –       30 179
Investment in associate      273 450            –            –
Long-term loans               27 953       27 855       28 689
Finance lease receivables    228 029      161 815      184 782
Deferred taxation             42 319       35 588       35 232
Current assets             2 260 376    2 079 843    2 501 814
Inventories on hand          882 414      685 103      940 655
Inventories in transit       106 950       65 800      108 031
Trade and other 
 receivables               1 160 463    1 243 065    1 125 423
Finance lease receivables     86 415       53 121       65 349
Taxation receivable              918        1 679        1 154
Short-term deposit                 –            –      237 272
Cash and cash equivalents     23 216       31 075       23 930
Total assets               3 172 439    2 571 175    3 096 450
EQUITY AND LIABILITIES
Capital and reserves       1 182 757      905 002    1 088 059
Share capital and premium     25 996       25 948       25 982
Treasury shares              (41 766)     (42 166)     (41 766)
Non-distributable reserves    33 607       31 636       32 588
Accumulated profits        1 161 610      884 599    1 066 308
Non-controlling interests      3 310        4 985        4 947
Non-current liabilities      529 152       55 785      503 594
Interest-bearing 
 liabilities                 504 584       36 566      482 075
Deferred taxation             24 568       19 219       21 519
Current liabilities        1 460 530    1 610 388    1 504 797
Trade and other payables     963 276    1 055 805    1 074 736
Interest-bearing 
 liabilities                  17 467       14 886       17 203
Short-term loan              114 999      214 823      115 543
Deferred revenue              14 398       11 423       14 519
Taxation payable              11 401        7 750       12 320
Bank overdrafts              338 989      305 701      270 476
Total equity and 
 liabilities               3 172 439    2 571 175    3 096 450
Capital management
Net asset value per 
 share (cents)                 746.3        570.0        686.0
Net tangible asset value 
 per share (cents)             663.4        508.1        604.2
Working capital management
Investment in working 
 capital (R’000)           1 172 153      926 740    1 084 854
Days inventory outstanding
 (excluding in 
 transit) (“DIOs”)              60.0         57.0         66.0
Days sales outstanding 
 (“DSOs”)                       60.0         57.0         50.0
Days purchases outstanding
 (“DPOs”)                       55.0         56.0         48.0
Liquidity and solvency
Debt to equity (%)              82.5         63.2         81.4
– Attributable to Distribution
   and Holdings                 35.7         40.5         36.4
– Attributable to 
   Datacentrix                  23.2            –         24.7
– Attributable to Finance
   Assets (Centrafin)           23.6         22.7         20.3
Current ratio (excluding stock
  in transit)                   1.59         1.30         1.71
Acid test (excluding stock
 in transit)                    0.94         0.86         1.04
GROUP CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
Opening balance            1 088 059      810 813      810 818
Shares issued                     14          (33)           –
Treasury shares issued             –            –          400
CGT on treasury shares sold        –            –       (3 267)
Comprehensive income for 
 the period                  163 291      149 132      326 740
Acquisition of 
 non-controlling interest     (9 398)           –         (968)
Equity-based compensation 
  reserve                      5 585          386        9 598
Dividends paid               (64 794)     (55 296)     (55 257)
Closing balance            1 182 757      905 002    1 088 059
Attributable to:
Owners of the Company      1 179 447      900 017    1 083 112
Non-controlling interests      3 310        4 985        4 947
GROUP CONSOLIDATED SUMMARY STATEMENT OF CASH FLOWS
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
EBITDA *                     232 543      228 635      493 254
Changes in working capital  (108 365)    (196 177)    (378 331)
Other non-fund flow items    (10 737)        (801)      10 037
Cash generated by 
 operating activities        113 441       31 657      124 960
Net finance costs             (6 851)     (10 112)     (18 558)
Finance income received       32 322       22 454       58 548
Finance expenses paid        (39 173)     (32 566)     (77 106)
Taxation paid                (64 275)     (53 338)    (117 583)
                              42 315      (31 793)     (11 181)
Cash flows from investing 
  activities
Property, plant and 
 equipment acquired          (60 787)     (63 914)     (84 328)
Proceeds on disposal of 
 property, plant and 
 equipment                    42 164          741        8 162
Acquisition of intangible 
 assets                       (4 175)      (1 718)      (7 912)
Net investment in finance
  leases receivable          (43 247)     (70 750)    (105 945)
Acquisition of subsidiaries        –       (5 013)      (6 000)
Acquisition of shares in
 Datacentrix (including 
 deposit)                     (1 223)           –     (267 451)
Acquisition of non-controlling 
  interest                    (1 465)           –            –
                             (68 733)    (140 654)    (463 474)
Cash flows from financing 
  activities
Interest-bearing liabilities 
 raised                       32 936       (7 432)     439 229
Interest-bearing 
 liabilities repaid          (10 707)           –      (14 724)
Shares issued                     14            –            –
Short-term loans raised            –       99 439       64 720
Short-term loans repaid            –            –      (64 561)
Decrease in long-term loans
  receivable                       –            –         (475)
Decrease in trust loans          736          359            –
Dividends paid               (64 794)     (55 296)     (55 257)
                             (41 815)      37 070      368 932
Decrease in net cash, cash 
 equivalents and 
 overdrafts                  (68 233)    (135 377)    (105 723)
Net (overdraft)/cash and cash
  equivalents acquired from
  business combinations         (994)         998         (576)
Net (overdraft)/cash and 
 cash equivalents at 
 beginning of period        (246 546)    (140 247)    (140 247)
Net (overdraft)/cash and 
 cash equivalents at end 
 of period                  (315 773)    (274 626)    (246 546)
* Earnings before interest, taxation, depreciation and 
amortisation.
BUSINESS COMBINATIONS
            31 Dec              30 June 2013
              2013
                       Dev-                      Pre- 
           Pacific*   trade      JAG   Modrac   cision     Total
             R’000    R’000    R’000    R’000    R’000     R’000
ASSETS
Property, 
 plant and 
 equipment     250      273   13 817    1 638       72    15 800
Inventories    294      652      306        –    8 619     9 577
Trade and 
 other 
 receivables 1 230    4 520    1 995    1 189    3 669    11 373
Taxation 
 receivable      –        2        –        –        –         2
Cash and cash 
 equivalents     –      629       40        –    1 888     2 557
             1 774    6 076   16 158    2 827   14 248    39 309
LIABILITIES 
Shareholders’ 
 loans           –        –        –   (6 329)  (1 036)   (7 365)
Deferred 
 taxation        –        –   (1 603)     (13)       –    (1 616)
Trade and 
 other 
 payables   (2 032)  (6 162)  (9 299) (12 710) (16 806)  (44 977)
Short-term 
 loan         (554)       –   (4 426)       –        –    (4 426)
Long-term 
 loan         (450)       –   (4 098)       –        –    (4 098)
Overdrafts    (994)       –   (3 133)       –        –    (3 133)
            (4 030)  (6 162) (22 559) (19 052) (17 842)  (65 615)
Net assets 
 acquired   (2 256)     (86)  (6 401) (16 225)  (3 594)  (26 306)
Less: 
 Non-
 controlling 
 interests       –        –      640        –        –       640
Goodwill on 
 acqui-
 sition     (2 226)  25 360    6 761   16 225    3 594    51 940
Purchase 
 amount
 –  paid         –    5 000    1 000        –        –     6 000
 –  to be 
    paid         –   20 274        –        –        –    20 274
Revenue 
 since 
 acqui-
 sition        258   11 302   12 444        –    4 270    28 016
Profit 
 before 
 taxation 
 since 
 acqui-
 sition        226    3 027    2 787        –    1 810     7 624
Group 
 revenue 3 160 872                                     6 692 856
Group 
 profit 
 before 
 taxation  221 684                                       433 419
* Amounts are provisional as the initial accounting for the 
business combination is incomplete.
ANALYSIS OF GOODWILL
                           Half year    Half year    Full year
                              31 Dec       31 Dec       30 Jun
                                2013         2012         2013
                           Unaudited    Unaudited      Audited
                               R’000        R’000        R’000
Opening balance              114 940       55 830       63 000
Business combination 
 acquisitions                  2 256       25 360       51 940
Impairments                        –            –            –
Closing balance              117 196       81 190      114 940
Business combination
  acquisitions
Devtrade                           –       25 360       25 360
Jag                                –            –        6 761
Modrac                             –            –       16 225
Pacific                        2 256            –            –
Precision                          –            –        3 594
                               2 256       25 360       51 940
BASIS OF PREPARATION AND ACCOUNTING POLICIES
The summarised unaudited financial results for the six months 
ended 31 December 2013 have been prepared in accordance with the 
framework concepts and measurement and recognition requirements 
of International Financial Reporting Standards (“IFRS”), the 
SAICA Reporting Guides as issued by the Accounting Practices 
Committee and Financial Reporting Pronouncements as issued by the 
Financial Reporting Standards Council, the information as 
required by IAS 34: Interim Financial Reporting, the Listings 
Requirements of the JSE Limited and the requirements of the 
Companies Act of South Africa. 
The summarised financial results, which are based on reasonable 
judgements and estimates, have been prepared using accounting 
policies that comply with IFRS. These are consistent with those 
applied in the annual financial statements for the year ended 30 
June 2013 except for those standards that came into effect during 
the 6 months under review.  IFRS 10, 11, 12 and 13 became 
effective in these financial statements for the first time. None 
of these statements had any material impact on the Company’s 
accounting policies, nor on the financial statements contained 
herein.
Neither the consolidated financial results for the six months 
ended 31 December 2013, nor this set of summarised financial 
information, has been reviewed or audited by the Group's 
auditors, BDO South Africa Incorporated. The directors take full 
responsibility for the preparation of this summarised report. Any 
reference to future financial performance included in this 
announcement has not been reviewed or reported on by the 
Company’s auditors.
COMMENTARY
INTRODUCTION
The Company presents its unaudited financial results for the six 
months to 31 December 2013. The trading period has been a 
challenging one with significant parts of our economy taking 
strain due to the debt restricted consumer, a plethora of labour 
unrest and a volatile and weakening exchange rate. 
FINANCIAL RESULTS 
Group revenue increased by 1% to R3.16 billion and gross profit 
increased by 6% on improved margins of 16.3% (2012: 15.6%). 
Operating expenses increased by 9.1% to leave Operating Income up 
by only 1.7%, which included the reclassification of the fair 
value adjustment on the derecognition of the investment in 
Datacentrix from a listed share to an equity accounted 
investment. The acquisition of the 34.99% share in Datacentrix 
affected interest paid by approximately R4.6 million, and the 
income calculated in accordance with IAS 28 meant that this 
investment shows a breakeven position at this stage.  Group 
borrowing costs decreased as a result of the growing net 
contribution of Centrafin’s financial assets.  There was a saving 
on the tax rate due to the utilisation of certain tax losses.  
The net result was that the 1% revenue growth was turned into a 
healthier increase in post-tax earnings of 9%.
DIVISIONAL PERFORMANCE  
The Distribution division increased revenue by 2% with net profit 
after tax also up by 2%. In the previous financial first half, 
this division had a significant deal of approximately R140 
million that it has been unable to repeat or make up for in the 
corresponding period to December 2013. The revenue increase 
without this deal would otherwise have been 6%. In addition, in a 
deliberate strategy to improve its gross margin, the Division 
chose not to participate in certain low margin deals. Revenue 
into Africa accelerated nicely by 46% and now stands at 13% of 
Distribution revenue (2012: 9%). Operating costs grew in line 
with expectation but increased as a percentage to revenue, as a 
result of the lower revenue achieved and the investment into the 
Advanced Technologies unit. This unit has recently taken on 
additional networking and security vendors, such as Cisco and 
Trend, which should deliver significant revenue in the months and 
years ahead. The operations of Jag and Modrac were consolidated 
during the period. This had a temporary effect on the trading of 
this unit but it is now fully operational and performing well. In 
addition, some of its assets were sold and newer machinery 
purchased and installed. The gain on sale of the assets sold went 
some way to offsetting the trading interruption. Consequently, 
although the revenue growth has been limited, the division has 
been able to maintain its income.
Infrasol, the IT Projects and Services division, increased 
turnover by 39% and net profit after tax by 29%. We continue to 
believe that emphasis into this exciting part of the Group will 
show the desired outcome in the years ahead.
Centrafin increased its revenue by 65% and achieved net profit 
after tax growth of 67%. The book continues to grow strongly (now 
at R348 million from R233 million a year ago). The funding for 
the book was supplied by the listing of the Group’s first issue 
of R315 million notes under the Group’s Domestic Medium Term Bond 
Programme at the end of April 2013. This funding secures 
Centrafin’s capital requirements for growth at the right rate and 
over the right term. Despite the increase in market penetration, 
Centrafin’s margins remain strong and customer defaults are well 
controlled.
FINANCIAL POSITION AND CASH FLOW
Inventories decreased by R58 million from June 2013 although 
considerably up from the similar period last year. The third 
quarter of the year is traditionally the largest revenue period 
and it is important that the Group has the necessary inventory to 
service it. The over stock position in the Samsung range reported 
at the end of June 2013 is largely resolved.
Trade Receivables are by and large well controlled although 
collections remained challenging over the last days in December. 
Daily Sales Outstanding (“DSOs”) were at 60 days compared to 57 
at the end of December 2012.
Daily Purchases Outstanding (“DPOs”) were maintained at 55 days 
(56 in December 2012) although with the decrease in activity in 
December compared to June, this has resulted in Trade and Other 
Payables being R111 million less than that reported in June 2013.
The main cash outflows comprised:
–  Increase in Working Capital of R108 million,
–  Taxation paid of R65 million,
–  The annual dividend to shareholders of R65 million,
–  An investment into buildings of R6 million for the Group’s new 
Free State office. The project was completed at the end of 
September and trading has since been above our expectations,
–  Other property improvements, vehicles, office equipment and 
software acquisitions (less disposals) making up the balance 
of R17 million,
–  Further investment of R43 million into Centrafin’s customer 
base as it continues to build its financial lease book (R330 
million) and its leased asset base (R18 million after 
depreciation), and
–  Further repayments on the Axiz acquisition and other long-term 
loans (R11 million).
This was funded by net operational cash flow of R228 million, R32 
million introduced by First National Bank for the land purchase 
in Samrand last year, and increases in overdrafts of R69 million. 
Borrowings now mainly comprise R116 million in short-term loans 
raised for Centrafin’s finance lease book and rental asset pool, 
subsidiary preference shares issued to Nedbank (treated as 
interest bearing liabilities at group level) of R130 million, the 
Nedbank loan to fund the purchase of Axiz amounting to 
R37 million, the medium term domestic note of R315 million, the 
Samrand land funding of R32 million and overdrafts of R339 
million against general banking facilities of R609 million. 
It must be borne in mind that this year’s borrowings profile is 
considerably skewed by two assets that should be ring-fenced due 
to their non-operational nature insofar as they relate to 
mainstream ICT distribution.   These are the investment in 
Datacentrix of R274 million and the investment into Centrafin’s 
financial assets totalling R348 million. Without these the 
Group’s borrowings would be in the order of R400 million and its 
debt to equity ratio would be under 36%.
Corporate Activity
Merqu: With effect 1 November 2013 Pinnacle acquired the balance 
of the shares that it did not already own (49%) in Merqu 
Communications (Pty) Ltd (“Merqu”). The purchase price was made 
up of R2 929 339 in cash, 50% payable immediately with the 
balance due on 30 June 2014, and up to a maximum of 279 381 
shares in Pinnacle. The shares will be issued over a 
3-year period, are subject to the profitability of Merqu for the 
year ending 30 June 2014, and will be issued at an agreed price 
of R23.10 per Pinnacle share. The managers, and previous owners, 
remain committed to the entity and have confidence in its future.
Pacific Cables: Pinnacle acquired 100% of the issued share 
capital of Pacific Cables (Pty) Ltd at a price of R1. The entity 
had a negative equity at the time of the acquisition which gave 
rise to an Intangible of R2.2 million. The rationale behind the 
purchase was to take on the employees involved in the 
distribution of Krone cables to add to the ranges sold in the 
Datanet division. The business has already been accommodated and 
settled into this division.
Datacentrix: On 30 October 2013, the Competition authorities 
approved, with certain conditions, for Pinnacle to acquire a 
controlling stake in Datacentrix Holdings Limited 
(“Datacentrix”). Consequently, the sale agreement, entered into 
with Co-ordinated Network Investments (Pty) Ltd and Hoolican 
Investments (Pty) Ltd on 6 June 2013 to acquire 61 152 467 shares 
in Datacentrix, became unconditional.
On 13 November 2013, two nominees of Pinnacle were appointed to 
the Datacentrix board. The directors have classified the 
investment in Datacentrix as an associated company on the basis 
that Pinnacle has significant influence, but not control, over 
the financial and operating policies of Datacentrix. Thus, with 
effect 1 November 2013 the results of Datacentrix have been 
equity accounted. 
IAS 28 Investments in Associates and Joint Ventures requires 
equity accounting to be based on financial information that is 
not more than 3 months old. However, Datacentrix is a listed 
company and only the most recently published financial 
information that is available to the public can be used for 
equity accounting purposes. The financial year end of Datacentrix 
is 28 February and therefore published results for the periods 
ended 28 February and 31 August have been used, and will in the 
future be used.
We are confident that Datacentrix will provide Pinnacle with a 
significant revenue flow from the managed services and business 
solutions market sector which is consistent with the Group’s 
strategy to secure a greater portion of higher margin annuity 
services and solutions revenues in its income mix.
SUBSEQUENT EVENTS
No other events material to the understanding of the report 
occurred in the period between the period-end date and the date 
of the report.
DIVIDENDS
In line with previous years, no interim dividend is proposed for 
the period under review.
PROSPECTS
The overall economy faces challenging times ahead, with the 
consumer becoming more financially constrained than ever and the 
resources sector, bedevilled by labour and demand issues. 
Nonetheless, the IT sector has remained resilient in the face of 
these and other economic challenges and it is envisaged that it 
will continue to remain reasonably so. 
It is anticipated that the investment into Datacentrix will 
deliver the group enhanced returns in the years ahead as we 
explore synergies and enhancements.
We are moving into the period of highest activity during the year 
for the IT industry and the Distribution division is well placed 
to take advantage of all of these opportunities. The efforts of 
the Group to expand its offerings into the rest of Africa is 
paying off, with year on year revenue growth into the region of 
46%. Infrasol is expanding its services offering and is seeing 
increased traction, while Centrafin, Pinnacle’s finance 
subsidiary, continues to enable transactions to take place within 
the Group.
STATEMENT OF COMPLIANCE
These condensed consolidated financial statements for the 6 
months ended 31 December 2013 have been prepared in accordance 
with the Group’s accounting policies under the supervision of the 
Chief Financial Officer, RD Lyon CA.
For and on behalf of the Board
D Mashile-Nkosi                          AJ Fourie
Chairperson                              Chief Executive Officer
Midrand
7 March 2014
PINNACLE HOLDINGS LIMITED
(previously Pinnacle Technology Holdings Limited)
Directors: D Mashile-Nkosi ^ (Chairperson), A Tugendhaft * 
(Deputy Chairperson), AJ Fourie (Chief Executive), SH Chaba ^, 
RD Lyon (Chief Financial Officer), RN Nkuna, TAM Tshivhase, 
E van der Merwe ^ 
* (Non-executive)       ^ (Independent non-executive)
Preparer of results: RD Lyon CA
Company Secretary: JV Parkin (BCompt(Hons), CTA)
Registered Office: The Summit, 269, 16th Road, Randjespark, 
Midrand, 1685
Transfer Secretaries: Computershare Investor Services (Pty) Ltd, 
Ground Floor, 70 Marshall Street, Johannesburg, 2001
Auditors: BDO South Africa Inc, Registered Auditors, 
13 Wellington Road, Parktown, 2193
Sponsor: Deloitte & Touche Sponsor Services (Pty) Ltd
www.pinnacleholdings.co.za

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