Wrap Text
Reviewed Interims for period ended 31 December 2013
Compu-Clearing Outsourcing Limited
"Compu-Clearing", "The Company" or "The Group"
Incorporated in the Republic of South Africa
Registration number 1998/015541/06
JSE Share code : CCL
ISIN ZAE 000016564
Listed on the JSE Limited
Reviewed condensed consolidated interim
financial statements for the six months
ended 31 December 2013
Highlights
Revenue 8% increase
Operating profit 35% increase
Profit for the period 18% increase
Cash generated by operations 26% increase
Headline earnings per share 17% increase
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
6 months ended Year ended
31 December 31 December 30 June
% Inc. 2013 2012 2013
[Reviewed] [Restated] [Restated]
R'000 R'000 R'000
Rental and other revenue 8 35,599 32,866 66,733
Operating costs (26,741) (26,294) (54,043)
- Distribution (19,608) (19,290) (39,073)
- Administration (5,796) (6,845) (14,530)
- Other (1,337) (159) (440)
Operating profit 35 8,858 6,572 12,690
Finance income 510 476 1,000
Profit before income tax 33 9,368 7,048 13,690
Income tax - normal and deferred (3,029) (1,698) (3,559)
Profit for the period 18 6,339 5,350 10,131
Other comprehensive income for the
period - 634 5,085
Total comprehensive income for the
period 6,339 5,984 15,216
Earnings per share [cents]
Basic 17 15.1 12.9 24.3
Diluted 19 15.1 12.7 24.3
Headline earnings per share [cents]
Basic 17 15.1 12.9 26.0
Diluted 18 15.1 12.7 26.0
Actual number of shares in issue ['000] 42,061 41,537 42,022
Weighted average number of shares in issue ['000] 42,048 41,531 41,710
Diluted weighted average number of shares in issue 42,048 42,045 41,710
Gross ordinary dividend per share declared[cents] - - 30.0
Gross ordinary dividend per share paid [cents] 30.0 25.0 25.0
STATEMENT OF FINANCIAL POSITION
31 December 31 December 30 June
2013 2012 2013
[Reviewed] [Reviewed] [Audited]
R'000 R'000 R'000
ASSETS
Non current assets 29,733 23,885 28,657
Property, plant and equipment 25,955 22,116 26,398
Intangible asset 3,561 1,711 1,590
Deferred taxation asset 217 58 669
Current assets 25,015 24,670 32,768
Inventory - 30 23
Trade and other receivables 9,266 8,612 9,800
Taxation receivable 753 1,556 477
Cash and cash equivalents 14,996 14,472 22,468
Total assets 54,748 48,555 61,425
EQUITY AND LIABILITIES
Equity 47,128 43,379 53,262
Share capital and premium 2,576 2,120 2,696
Treasury shares - (330) (265)
Distributable reserves 44,552 41,589 50,831
Non-current liabilities 3,074 1,351 2,687
Post retirement medical obligations 414 451 433
Deferred taxation liability 2,660 900 2,254
Current liabilities 4,546 3,825 5,476
Trade and other payables 3,777 3,825 5,476
Income tax payable 769 - -
Total liabilities 7,620 5,176 8,163
Total equity and liabilities 54,748 48,555 61,425
Net asset value per share [cents] 112.0 104.4 126.7
Net tangible asset value per share [cents] 103.6 100.3 123.0
RECONCILIATION OF HEADLINE EARNINGS
6 months ended Year ended
31 December 31 December 30 June
% Inc. 2013 2012 2013
[Reviewed] [Restated] [Restated]
R'000 R'000 R'000
Profit for the period attributable to ordinary
shareholders 6,339 5,350 10,131
Adjusted for:
Loss on disposal of property, plant and equipment 8 9 1,009
Taxation effect (2) (3) (283)
Headline earnings 6,345 5,356 10,857
STATEMENT OF CHANGES IN EQUITY
6 months ended Year ended
31 December 31 December 30 June
2013 2012 2013
[Reviewed] [Review ed] [Audited]
R'000 R'000 R'000
Balance at beginning of period 53,262 47,695 47,695
Proceeds of share issues 145 78 723
Total comprehensive income for the period 6,339 5,984 15,216
Share-based payment reserve movement - 6 12
Dividends paid (12,618) (10,384) (10,384)
Balance at end of period 47,128 43,379 53,262
SEGMENTAL REPORT
6 months ended Year ended
31 December 31 December 30 June
% Inc. 2013 2012 2013
[Reviewed] [Restated] [Restated]
R'000 R'000 R'000
Revenue
Software rental 9 27,426 25,274 51,063
Hardware rental 3 5,720 5,529 11,310
CargoWise One 25 1,772 1,417 2,919
Headoffice 5 681 646 1,441
Total revenue from external sources 8 35,599 32,866 66,733
Segment profit/(loss)
Software rental 13,367 11,119 24,672
Hardware rental 1,847 1,916 1,803
CargoWise One 687 630 1,030
Headoffice (6,533) (6,617) (13,815)
Profit before income tax 33 9,368 7,048 13,690
Segment Assets
Software rental 14,114 10,867 12,126
Hardware rental 7,253 8,934 7,441
CargoWise One 423 779 852
Headoffice 32,958 27,975 41,006
Total assets 54,748 48,555 61,425
Segment Liabilities
Software rental 206 120 693
Hardware rental 87 150 241
CargoWise One 955 625 540
Headoffice 6,372 4,281 6,689
Total liabilities 7,620 5,176 8,163
STATEMENT OF CASH FLOWS
6 months ended Year ended
31 December 31 December 30 June
2013 2012 2013
[Reviewed] [Restated] [Restated]
R'000 R'000 R'000
Profit before income tax 9,368 7,048 13,690
Adjusted for: 1,390 1,249 3,468
Non cash items 1,900 1,725 4,468
Net finance income (510) (476) (1,000)
Cash generated by trading operations 10,758 8,297 17,158
(Decrease) increase in post retirement medical
obligations (19) (38) 24
Increase in working capital (1,142) (668) (198)
Cash generated by operations 9,597 7,591 16,984
Net finance income 510 476 1,000
Income tax paid (1,679) (2,270) (3,786)
Dividends paid (12,618) (10,384) (10,384)
Cash (outflow)/inflow from operating
activities (4,190) (4,587) 3,814
Cash outflow from investing activities (3,427) (1,362) (2,412)
Acquisition of property, plant and equipment (1,135) (1,092) (1,998)
Acquisition of intangible asset (2,313) (300) (472)
Proceeds on disposal of property, plant
and equipment 21 30 58
Cash generated by financing activities 145 78 723
Proceeds from the issue of shares - 78 465
Proceeds from the sale of treasury shares 145 - 258
(Decrease) increase in cash and cash equivalents (7,472) (5,871) 2,125
Cash and cash equivalents at the beginning of the
period 22,468 20,343 20,343
Cash and cash equivalents at the end of the period 14,996 14,472 22,468
Commentary
Compu-Clearing is South Africa's market leader in the provision of IT services and products to
the customs clearing and freight forwarding industries.
The Group's core revenue is transaction-based and directly linked to customer import and
export volumes. Other revenue segments comprise hardware rental and the distribution of a
globally leading third party freight management solution, CargoWise One (formerly
ediEnterprise).
For the six months to 31 December 2013 Group revenue grew by 8% to R35,6 million
(2012 – R32,9 million). This was driven by a 9% growth in the software rental segment and a
25% growth in the CargoWise One segment, which although off a small base is making good
progress by adding new clients.
A pleasing 35% growth in operating profit was achieved. This was a result of reasonable
revenue growth combined with excellent operating costs control.
Cash flow for the period remained robust with cash generated by operations up 26% to R9,6
million (2012 – R7,6 million).
The period saw the commencement of a project to entrench and enhance Compu-Clearing's
position as a market leader. The first phase of the Group's new flagship product
Compusolutions Diamond ("Diamond"), has already met with an enthusiastic response.
Development costs amounting to R1,2 million (2012—RNil) attributable to this project have
been capitalised to intangible assets and will be amortised against the related revenue flows.
Revenue flows from Diamond will commence in the second half of this financial year.
Prospects
The CargoWise One segment continues to grow with further implementations expected to go
live in the second half of the 2014 financial year, which will drive further growth within the
segment.
The Group will seek further market penetration through the release of Diamond, intensified
marketing efforts and continued development of new functionality in existing products. Man-
agement continue to monitor costs and maintain operating margins at acceptable levels.
Basis of preparation
The condensed consolidated interim financial statements for the six months ended 31 Decem-
ber 2013 have been prepared and presented in accordance with the requirements of
International Financial Reporting Standard IAS 34 Interim Financial Reporting, the SAICA
Financial Reporting Guides as issued by the Accounting Practices Committee, Financial
Pronouncements as issued by the Financial Reporting Standards Council, the Listings
Requirements of the JSE Limited and the South African Companies Act, No 71 of 2008, as
amended.
In preparing these condensed consolidated interim financial statements, management makes
use of judgements, estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets and liabilities, income and expense.
Actual results may differ from these estimates.
The significant judgements made by management in applying the Group's accounting policies
and the key sources of estimation uncertainty were the same as those that applied to the
consolidated financial statements as at and for the year ended 30 June 2013.
The accounting policies applied in the presentation of the condensed consolidated interim
financial statements, which comply with International Financial Reporting Standards, are
consistent with those applied for the year ended 30 June 2013, except for new standards and
interpretations that became effective on 1 July 2013. The condensed consolidated interim
financial statements have been presented on the historical cost basis and are presented in
Rand rounded to the nearest thousand, which is the Group`s functional and presentation
currency.
This interim report should be read in conjunction with the financial statements for the year
ended 30 June 2013.
Changes in accounting policies
The Group adopted the new, revised or amended accounting pronouncements as issued by
the IASB, which were effective and applicable to the Group from 1 July 2013.
IFRS 10 Consolidated Financial Statements
IFRS 10 establishes principles for the presentation and preparation of consolidated financial
statements when an entity controls one or more other entities. The Group has revised its
accounting policies on the consolidation of subsidiaries and concluded that the adoption of
IFRS 10 did not result in any material change in the consolidation of the Group.
IFRS 13: Fair value measurement
IFRS 13 aims to improve consistency and reduce complexity by providing a precise definition
of fair value and a single source of fair value measurement and disclosure requirements for
use across IFRS. IFRS 13 was adopted and applied prospectively and it was assessed that
the adoption did not result in any material impact on the financial results of the Group. The
face value of the financial instruments presented approximates the fair value.
IAS 19 Employee benefits
As a result of IAS 19 (2011), the Group has changed its accounting policy with respect to the
basis for determining the income or expense related to the defined benefit medical obligation.
Under IAS 19 (2011), the Group determines the net interest expense for the period on the net
defined benefit liability by applying the discount rate used to measure the defined benefit
obligation at the beginning of the annual period to the net defined benefit liability at the begin-
ning of the annual period, taking into account any changes in the net defined benefit liability
during the period as a result of contributions and benefit payments. Consequently, the net
interest on the net defined benefit liability now comprises:
- interest cost on the defined benefit obligation;
- interest income on plan assets; and
- interest on the effect on the asset ceiling.
In addition the movements in the defined benefit plan are now shown in other comprehensive
income and not in profit or loss.
The effect on the statement of profit or loss and other comprehensive income is as follows:
31 31 30
December December June
2013 2012 2013
[Reviewed] [Restated] [Restated]
Profit for the period:
Overall decrease in profit for the period - (634) (691)
Overall increase in other comprehensive income for the period - 634 691
Overall impact on total comprehensive income for the period - - -
The change in accounting policy has had no material impact on the statement of financial
position. The movement in post retirement medical obligations no longer has a material impact
on the statement of cash flows. The movement previously reported for 30 June 2013 and
31 December 2012 was R0,9million.
The basic and diluted earnings per share for the year ended 30 June 2013, previously re-
ported as 25.9 cents, has moved to 24.3 cents. The basic and diluted earnings per share for
the six months ended 31 December 2012, previously reported as 14.4 cents and 14.2 cents
have moved to 12.9 and 12.7 cents respectively.
Headline earnings and diluted headline earnings per share for the year ended 30 June 2013,
previously reported as 27.7 cents, has moved to 26.0 cents. Headline and diluted headline
earnings per share for the six months ended 31 December 2012, previously reported as 14.4
cents and 14.2 cents have moved to 12.9 and 12.7 cents respectively.
We have assessed the impact of all other new standards that are currently effective and these
standards have no material impact on the results of the Group.
Distributions to shareholders
Compu-Clearing has a policy of paying a dividend at year end. As a result, the company has
not declared an interim dividend.
Reviewed report
The condensed consolidated interim financial statements of Compu-Clearing Outsourcing
Limited for the six months ended 31 December 2013 have been reviewed by the company's
auditor, KPMG Inc. In their reviewed report dated 10 March 2014, which is available for
inspection at the Company's Registered Office. KPMG Inc state that their review was con-
ducted in accordance with the International Standard on Review Engagements 2410, Review
of Interim Information Performed by the Independent Auditor of the Entity, and have expressed
an unmodified conclusion on the condensed consolidated interim financial statements.
Changes to the board of directors
Shareholders are referred to the announcement published on SENS on Tuesday, 11 March
2014, wherein it was announced that Mr Costas Efthymiades has stepped down as Group
Financial Director from the Board and that Mr Jonathan Davis has been appointed in his
stead.
The effective date of both changes is 11 March 2014.
Related party transactions
There has been no significant change in related party relationships since the previous year.
Other than in the normal course of business, there have been no significant transactions
during the year with related parties.
Significant transactions
No material events or circumstances have occurred subsequent to the period end.
For and on behalf of the Board
Johannesburg A. Garber J. du Preez
10 March 2014 (Chairman) (Chief Executive)
Executive directors: A. Garber, J. du Preez, M. Acosta-Alarcon, C. Efthymiades
Independent non-executive directors : A. Katz, Dr. T. Mogale
Non-executive directors : D. Cleasby, M. Lutrin, G. McMahon
Prepared by: J Davis B Acc CA(SA) under the supervision of the financial director
email:jonathan@compuclearing.za.com
14 March 2014
Transfer secretaries: Registered office:
Computershare Investor Services Proprietary Limited 7 Drome Road
Ground Floor Lyndhurst, 2192
70 Marshall Street PO Box 890856
Johannesburg, 2001 Lyndhurst, 2106
Sponsor
Sasfin Capital
(a division of Sasfin Bank limited)
Auditors
KPMG
WWW.COMPCLEAR.CO.ZA
Date: 19/03/2014 03:53:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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