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Preliminary audited results for the year ended 30 June 2014, Final dividend declaration and notice of AGM
ADAPT IT HOLDINGS LIMITED
Incorporated in the Republic of South Africa
Registration number: 1998/017276/06
Share code: ADI
ISIN: ZAE000113163
("Adapt IT" or "the Company" or "the Group")
PRELIMINARY SUMMARISED CONSOLIDATED AUDITED RESULTS
FOR THE YEAR ENDED 30 JUNE 2014,
FINAL DIVIDEND DECLARATION
AND NOTICE OF ANNUAL GENERAL MEETING
SUMMARISED STATEMENTS OF PROFIT OR LOSS
AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2014
Group Group Company Company
2014 2013 2014 2013
R R R R
Revenue 408 546 471 306 035 046 14 811 282 12 437 997
Turnover 406 300 843 303 401 597 – –
Cost of sales (227 799 448) (171 782 171) – –
Gross profit 178 501 395 131 619 426 – –
Administrative, selling and other costs (128 971 855) (102 734 945) (56 889) (931 743)
Sundry revenue 158 787 515 031 9 931 8 652
Profit/(loss) from operations 49 688 327 29 399 512 (46 958) (923 091)
Finance income 2 086 841 2 118 418 – 14 672
Finance costs (907 425) (785 526) (1 310) –
Profit/(loss) before taxation 50 867 743 30 732 404 (48 268) (908 419)
Income tax (expense)/credit (12 744 711) (6 641 751) (104 511) 401 847
Profit/(loss) for the year 38 123 032 24 090 653 (152 779) (506 572)
Attributable to:
Equity holders of the parent 38 123 032 24 090 653 (152 779) (506 572)
Other comprehensive income
Items that will not be reclassified to profit and loss – 1 601 938 – –
Revaluation of land and building – 2 224 914 – –
Income tax effect – (622 976) – –
Items that may be reclassified subsequently
to profit and loss 761 298 622 792 – –
Exchange differences arising from translation
of foreign operations 761 298 622 792 – –
Total comprehensive income/(loss) 38 884 330 26 315 383 (152 779) (506 572)
Attributable to:
Equity holders of the parent 38 884 330 26 315 383 (152 779) (506 572)
Basic earnings per share (cents) 34,45 22,25
Basic diluted earnings per share (cents) 33,48 22,25
SUMMARISED STATEMENTS OF FINANCIAL POSITION
AS AT 30 JUNE 2014
Group Group Company Company
2014 2013 2014 2013
R R R R
ASSETS
Non-current assets 188 661 639 86 684 069 50 341 142 54 235 229
Property and equipment 30 751 151 28 351 209 – –
Intangible assets 8 323 033 5 772 000 – –
Goodwill 133 486 825 38 010 030 – –
Interest in subsidiaries and share trust – – 48 115 401 48 115 401
Loans to subsidiary – – 1 391 804 5 641 125
Deferred taxation asset 16 100 630 14 550 830 833 937 478 703
Current assets 111 484 922 92 038 482 209 030 2 483 204
Trade and other receivables 91 266 975 64 038 739 174 783 101 270
Current tax receivable 4 301 168 5 307 082 – 114 515
Cash and cash equivalents 15 916 779 22 692 661 34 247 2 267 419
Total assets 300 146 561 178 722 551 50 550 172 56 718 433
EQUITY AND LIABILITIES
Equity 185 100 627 92 233 683 24 583 303 15 244 386
Share capital 11 150 11 100 11 150 11 100
Treasury shares – (277) – –
Share premium 23 925 590 14 625 917 19 210 578 17 457 386
Other capital reserves 51 055 840 1 300 000 15 055 840 1 300 000
Foreign currency translation reserve 1 889 265 1 127 967 – –
Revaluation reserve 1 601 938 1 601 938 – –
Retained earnings 106 616 844 73 567 038 (9 694 265) (3 524 100)
Non-current liabilities 7 981 419 3 746 839 39 679 25 518
Interest-bearing borrowings 4 275 947 – – –
Deferred taxation liability 3 705 472 3 746 839 39 679 25 518
Current liabilities 107 064 515 82 742 029 25 927 190 41 448 529
Trade and other payables 27 173 765 18 549 873 864 123 449 751
Provisions 20 823 698 14 200 079 2 898 085 1 709 655
Deferred income 54 232 537 47 979 558 – –
Amounts owing to subsidiaries – – 22 085 587 39 289 123
Current tax payable 1 816 200 – 79 395 –
Current portion of interest-bearing borrowings 3 018 315 642 519 – –
Current portion of non-interest-bearing borrowings – 1 370 000 – –
Total equity and liabilities 300 146 561 178 722 551 50 550 172 56 718 433
Number of ordinary shares in issue 111 499 091 111 001 011
Net asset value per share (cents) 167,25 85,18
Tangible net asset value per share (cents) 46,73 47,88
SUMMARISED STATEMENTS OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2014
Group Group Company Company
2014 2013 2014 2013
R R R R
OPERATING ACTIVITIES
Cash generated from/(utilised in) operations 60 642 283 36 662 063 1 482 331 (481 703)
Finance income 2 086 841 2 118 418 – 14 672
Finance costs (907 425) (785 526) (1 310) –
Dividends paid (6 017 386) (5 248 514) (6 017 386) (5 372 449)
Taxation (paid)/refunded (15 279 581) (11 481 189) (251 674) 337 171
Net cash flow from/(utilised in) operating activities 40 524 732 21 265 252 (4 788 039) (5 502 309)
INVESTING ACTIVITIES
Property and equipment acquired (6 038 613) (7 902 169) – –
Intangible assets acquired and developed (4 978 014) (6 578 478) – –
Proceeds on disposal of property and equipment 41 648 58 723 – –
Net cash outflow on acquisition of subsidiaries (32 206 631) (7 164 718) – –
Net cash utilised in investment activities (43 181 610) (21 586 642) – –
FINANCING ACTIVITIES
Proceeds from borrowings 51 900 000 28 916 920 – –
Repayment of borrowings (46 618 257) (30 878 076) – –
Share repurchases – (294 249) – –
Issue of Company's shares – – 1 753 242 –
Increase in amounts owing to subsidiaries – – 801 625 7 667 525
Repayment of vendor loans (10 155 631) – – –
Net cash (utilised in)/flows from financing activities (4 873 888) (2 255 405) 2 554 867 7 667 525
Net (decrease)/increase in cash resources (7 530 766) (2 576 795) (2 233 172) 2 165 216
Exchange differences on translation 754 884 619 030 – –
Cash and cash equivalents at beginning of year 22 692 661 24 650 426 2 267 419 102 203
Cash and cash equivalents at end of year 15 916 779 22 692 661 34 247 2 267 419
SUMMARISED STATEMENTS OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2014
Attributable to equity holders of the parent
Foreign
Other Asset currency
Share Treasury Share capital revaluation translation Retained Total
capital shares premium reserves reserve reserve earnings equity
Group R R R R R R R R
Balance at 30 June 2012 11 100 (256) 14 920 145 – – 505 175 54 724 899 70 161 063
Total comprehensive income for the year – – – – 1 601 938 622 792 24 090 653 26 315 383
Profit for the year – – – – – – 24 090 653 24 090 653
Other comprehensive income for the year – – – – 1 601 938 622 792 – 2 224 730
Shares issued during the year – – – 1 300 000 – – – 1 300 000
Net repurchase of shares – (21) (294 228) – - – – (294 249)
Dividend paid – – – – – – (5 248 514) (5 248 514)
Balance at 30 June 2013 11 100 (277) 14 625 917 1 300 000 1 601 938 1 127 967 73 567 038 92 233 683
Total comprehensive
income for the year – – – – – 761 298 38 123 032 38 884 330
Profit for the year – – – – – – 38 123 032 38 123 032
Other comprehensive income for the year – – – – – 761 298 – 761 298
Issue of treasury shares for business combination – – 1 300 000 (1 300 000) – – – –
Shares to be issued –
raised at acquisition on business combination – – – 52 000 000 – – – 52 000 000
Purchase consideration adjustment – – – (944 160) – – 944 160 –
Issue of shares for business combination 50 277 7 999 673 – – – – 8 000 000
Shares issued during the year 50 – 1 753 192 – – – – 1 753 242
Issue of treasury shares – 277 6 246 481 – – – – 6 246 758
Dividend paid – – – – – – (6 017 386) (6 017 386)
Balance at 30 June 2014 11 150 – 23 925 590 51 055 840 1 601 938 1 889 265 106 616 844 185 100 627
Other
Share Share capital Retained Total
capital premium reserves earnings equity
Company R R R R R
Balance at 30 June 2012 11 100 17 457 386 – 2 354 921 19 823 407
Total comprehensive loss for the year – – – (506 572) (506 572)
Shares to be issued – – 1 300 000 – 1 300 000
Dividend paid – – – (5 372 449) (5 372 449)
Balance at 30 June 2013 11 100 17 457 386 1 300 000 (3 524 100) 15 244 386
Total comprehensive loss for the year – – – (152 779) (152 779)
Issue of shares 50 1 753 192 (1 300 000) – 453 242
Shares to be issued – – 15 055 840 – 15 055 840
Dividend paid – – – (6 017 386) (6 017 386)
Balance at 30 June 2014 11 150 19 210 578 15 055 840 (9 694 265) 24 583 303
NOTES TO THE ANNUAL FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 JUNE 2014
EARNINGS AND DIVIDENDS PER SHARE
EARNINGS PER SHARE
The calculation of earnings per share is based on the profit attributable to equity holders of R38 123 032
(2013: R24 090 653) and the weighted average number of ordinary shares in issue during the year of 110 674 184
(2013: 108 286 526). The calculation of fully diluted earnings per share is based on the profit of R38 123 032
(2013: R24 090 653) and the weighted average number of diluted ordinary shares in issue during the year of 113 873
316 (2013: 108 286 526).
There is no effect of dilution in the prior year.
Group Group
2014 2013
R R
Reconciliation between earnings and headline earnings
Earnings attributable to equity holders of the parent 38 123 032 24 090 653
Adjusted for:
– Loss on sale of property and equipment 111 975 20 852
Headline earnings 38 235 007 24 111 505
Basic earnings per share (cents) 34,45 22,25
Headline earnings per share (cents) 34,55 22,27
Diluted basic earnings per share (cents) 33,48 22,25
Diluted headline earnings per share (cents) 33,58 22,27
DIVIDENDS PER SHARE
Dividends per share (cents) 5,56 4,84
EVENTS AFTER THE REPORTING DATE
No significant transactions or events have occurred between year-end and the date of this report.
BUSINESS COMBINATIONS
ACQUISITION OF SUBSIDIARY
On 1 October 2013, the Group acquired the entire issued share capital of Aquilon (Pty) Ltd, Aquilon Evolution Holdings (Pty) Ltd and
Aquilon Evolution Consulting (Pty) Ltd (the Aquilon Companies), and 40% of the issued shares in Fuel-Loc (Pty) Ltd.
The Aquilon Companies and Fuel-Loc (Pty) Ltd are South African registered companies.
The Aquilon Companies are specialist SAP consultancies, which design, implement and support SAP® IS-Oil implementations.
They provide SAP services to six of the major oil companies trading in South Africa and globally.
The purchase consideration consists of R38 000 000 cash paid on 29 November 2013 and shares to the value of R8 000 000 issued in
December 2013.
R52 000 000 is contingent upon the actual achievement of specified profit warranties (profit warranties) over a 33 month period (earn-
out portion).
The earn-out portion of a maximum of R52 000 000 shall be settled via the issue of shares upon the attainment of the profit warranties.
The profit warranties are as follows:
– R18 300 000 profit after tax for the period 1 October 2013 to 30 June 2014 (first warranty). Should such profit after tax be achieved,
shares to the value of R16 000 000 shall be issued;
– R32 000 000 profit after tax for the period 1 July 2014 to 30 June 2015 (second warranty). Should such profit after tax be achieved,
shares to the value of R18 000 000 shall be issued; and
– R38 400 000 profit after tax for the period 1 July 2015 to 30 June 2016 (third warranty). Should such profit after tax be achieved, shares
to the value of R18 000 000 shall be issued.
The 2014 profit after tax as measured in accordance with the agreement, was 94,1% of the first warranty, resulting in an adjustment of
R944 160 to the R16 000 000 contingent consideration such that R15 055 840 vested at 30 June 2014. 4 277 227 shares shall be issued
at 352 cents per share within 60 days in settlement thereof.
The warranty adjustment of R944 160 represents the unearned contingent share consideration in respect of the first warranty period.
The latest financial projections for the Aquilon Companies indicates that the 2015 and 2016 profit warranties will be achieved and
accordingly the R36 000 000 shares to be issued are disclosed as other capital reserves.
The shares to be issued to settle the earn-out portion shall be issued within 60 days after the end of the 2015 performance warranty
period and 2016 performance warranty period respectively and shall be reduced pro-rata to the extent that such profit warranties are
not attained.
Shares are specifically issued at a volume weighted average traded price of 352 cents per share.
The fair value of the net assets acquired amounted to R2 523 205, resulting in goodwill of R95 476 795 at acquisition. The consideration
paid for the combination effectively included amounts in relation to the benefit of the expected synergies, revenue growth, new market
penetration and future market development.
The acquisition of Aquilon Companies provides Adapt IT with an entry into specialised areas within the Oil & Gas sector. The strategic
acquisition assists Adapt IT to expand into the growing Energy sector in Africa, as well as extend its local reach into the Western Cape,
and bolsters its SAP solutions expertise.
The fair values of the identifiable net assets and liabilities of Aquilon Companies as at the date of acquisition were:
Fair value
recognised
on
acquisition
R
Assets
Property and equipment 209 863
Intangible assets 17 354
Deferred taxation 1 097 546
Trade and other receivable 23 349 566
Cash and cash equivalents 5 793 369
Total assets 30 467 698
Liabilities
Current portion of non-interest-bearing borrowings (previous shareholders) 10 155 631
Trade and other payables 10 961 786
Provisions 1 963 713
Current tax payable 4 863 363
Total liabilities 27 944 493
Total identifiable net assets 2 523 205
Goodwill arising on acquisition 95 476 795
Fair value of consideration transferred 98 000 000
Settled in shares 8 000 000
Shares to be issued 52 000 000
Settled in cash 38 000 000
Cash outflow on acquisition:
Net cash acquired with the subsidiary 5 793 369
Cash paid (38 000 000)
Net cash outflow on acquisition (32 206 631)
Fair value of the assets acquired approximates their carrying value at the acquisition date.
From the date of acquisition, the Aquilon Companies have contributed R13 638 834 to the profit after tax and R70 618 357 to the turnover
of the Group.
Acquired receivables represent the gross contractual amounts which approximates fair value and which is further estimated to be fully
recoverable.
Goodwill recognised is not deductible for tax purposes.
Acquisition related costs of R2 009 997 have been expensed and are included in administrative, selling and other costs on the state-
ments of profit or loss and other comprehensive income.
The current portion of non-interest-bearing borrowings related to dividends due to the previous shareholders paid at the end of March
2014.
SEGMENT ANALYSIS
For management purposes, the Group is organised into the following segments:
– Education – Adapt IT Pretoria;
– Manufacturing – Adapt IT Durban, ApplyIT (Pty) Ltd and Swicon360 (Pty) Ltd;
– Financial Services – Adapt IT Johannesburg;
– Energy – the Aquilon Companies; and
– Other – includes once off transaction costs.
Management monitors the operating results of its business units separately for the purpose of making decisions about
resource allocation and performance assessment. Monthly management meetings are held to evaluate segment
performance against budget and forecast.
The following tables present turnover and profit information (after shared services cost allocation) regarding the
Group's operating segments for the year ended 30 June 2014 and 30 June 2013 respectively:
Manu- Financial
Education facturing Services Energy Other Total
R R R R R R
2014
Turnover 123 112 190 147 718 537 64 851 759 70 618 357 – 406 300 843
Segment profit/(loss)
from operations 15 127 121 12 492 200 6 410 444 18 842 133 (3 183 571) 49 688 327
Operating profit margin (%) 12 8 10 27 – 12
2013
Turnover 120 388 513 134 594 807 48 418 277 – – 303 401 597
Segment profit/(loss)
from operations 14 692 854 13 092 734 3 054 323 – (1 440 399) 29 399 512
Operating profit margin (%) 12 10 6 – – 10
The following table presents segment assets, liabilities, trade receivables and turnover by geographic area of the
Group's operating segments as at 30 June 2014 and 30 June 2013:
Manu- Financial
Education facturing Services Energy Other Total
R R R R R R
2014
Total assets 61 338 659 83 258 379 28 531 537 125 972 620 1 045 366 300 146 561
Total liabilities 52 482 412 43 344 032 5 258 682 10 078 692 3 882 116 115 045 934
Turnover from external
customers by
geographic area* 123 210 879 147 768 990 64 686 601 70 634 373 – 406 300 843
South Africa 96 228 904 106 410 212 64 686 601 40 229 413 – 307 555 130
African countries** 16 759 352 32 062 494 – – – 48 821 846
Europe 4 510 939 – – – – 4 510 939
Asia – – – 10 428 525 – 10 428 525
North America – 2 937 733 – 19 976 435 – 22 914 168
Australasia 5 711 684 6 358 551 – – – 12 070 235
Non-current assets by
geographic area 28 621 315 43 199 421 15 672 592 100 334 373 833 938 188 661 639
South Africa 28 499 902 43 199 421 15 672 592 100 334 373 833 938 188 540 226
Europe 75 855 – – – – 75 855
Australasia 45 558 – – – – 45 558
Trade receivables by
geographic area 22 944 964 27 864 737 13 122 747 22 378 841 – 86 311 289
South Africa 14 852 432 14 260 177 13 122 747 11 553 251 – 53 788 607
African countries** 5 697 880 7 623 757 – – – 13 321 637
Europe 462 828 – – – – 462 828
Asia – – – 2 897 745 – 2 897 745
North America – 498 473 – 7 927 845 – 8 426 318
Australasia 1 931 824 5 482 330 – – – 7 414 154
* The turnover information above is based on the location of the customer
** African countries are: Ghana, Zambia, Tanzania, Mozambique, Namibia, Malawi, Swaziland, Lesotho, Botswana,
Uganda, Sierra Leone, Zimbabwe, Nigeria and Rwanda
Turnover of approximately R72 492 629 (2013: R50 624 466) is derived from a group of related customers. This turnover
is attributable to the Manufacturing segment.
Manu- Financial
Education facturing Services Energy Other Total
R R R R R R
2013
Total assets 64 923 628 84 186 060 26 634 865 – 2 977 998 178 722 551
Total liabilities 47 361 895 32 213 226 4 727 987 – 2 185 760 86 488 868
Turnover from external
customers by
geographic area* 120 388 513 134 594 807 48 418 277 – – 303 401 597
South Africa 93 498 521 91 179 923 48 418 277 – – 233 096 721
African countries** 19 835 429 37 658 272 – – – 57 493 701
Europe 3 453 730 – – – – 3 453 730
Australasia 3 600 833 3 520 217 – – – 7 121 050
North America – 2 236 395 – – – 2 236 395
Non-current assets by
geographic area 26 805 781 43 690 351 15 709 234 – 478 703 86 684 069
South Africa 26 377 532 43 690 351 15 709 234 – 478 703 86 255 820
African countries** – – – – – –
Europe 35 771 – – – – 35 771
Australasia 392 478 – – – – 392 478
Trade receivables by
geographic area 22 420 490 35 151 235 7 471 961 – – 65 043 686
South Africa 14 039 248 24 278 412 7 471 961 – – 45 789 621
African countries** 4 179 053 7 413 820 – – – 11 592 873
Europe 391 106 – – – – 391 106
Australasia 3 811 083 1 024 710 – – – 4 835 793
North America – 2 434 293 – – – 2 434 293
* The turnover information above is based on the location of the customer
** African countries are: Ghana, Zambia, Tanzania, Mozambique, Namibia, Malawi, Swaziland, Lesotho, Botswana,
Uganda, Sierra Leone, Zimbabwe and Rwanda
Amounts previously included under adjustments and eliminations in the prior year, relating mainly to goodwill,
have been reallocated to the related segment in the tables above in order to allow for a more meaningful analysis.
BASIS OF PREPARATION
The accounting policies applied in the preparation of these preliminary summarised consolidated audited financial statements,
which are based on reasonable judgements and estimates, are in accordance with International Financial Reporting
Standards ("IFRS") and are consistent with those applied in the consolidated annual financial statements for the year ended
30 June 2013. All amendments to IFRS were considered insignificant to the current year. These preliminary summarised consolidated
audited financial statements as set out in this report have been prepared in terms of, the Companies Act, 2008, as amended, IAS 34:
Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, the
Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, and the JSE Listings Requirements.
The consolidated annual financial statements have been prepared under the historical cost method, except in the case of property measured
at fair value. The consolidated annual financial statements have been prepared on the going-concern basis and have been prepared under
the supervision of Ms Tiffany Dunsdon, the financial director.
These preliminary summarised consolidated audited financial statements, which have been derived from the consolidated annual
financial statements and with which they are consistent in all material respects, have been audited by Deloitte & Touche. Their
unmodified audit opinions on the consolidated annual financial statements and on the preliminary summarised consolidated
audited financial statements (IAS 810) are available for inspection at the registered office of the Company. The board of directors
of Adapt IT (“the Board”) takes full responsibility for the preparation of this preliminary report and that the financial
information has been correctly extracted from the underlying consolidated audited annual financial statements, which is
available for inspection at the registered office of the Company.
AUDIT REPORT
The annual financial statements for the year ended 30 June 2014 have been audited by the Group's auditors,
Deloitte & Touche and their unqualified audit report is available for inspection at the Company's registered office.
The auditor’s report does not necessarily report on all of the information contained in this announcement. Shareholders are
therefore advised that in order to obtain a full understanding of the nature of the auditor’s engagement they should obtain a copy
of the audit report together with the accompanying financial information from the Company’s registered office. Any reference to
future financial performance included in this announcement has not been reviewed or reported on by the Company’s auditor.
FINANCIAL PERFORMANCE
JSE listed Adapt IT Holdings Limited, a provider of specialised turnkey IT solutions and services to the Education,
Manufacturing, Financial Services and Energy sectors, today announced its results for the year ended 30 June 2014.
“Our growth has exceeded the Information and Communications Technology ("ICT") industry averages with 33,9% turnover growth,
55,1% headline earning per share growth and total shareholder returns of 332%. This has not only attracted additional institutional
following, but increased shareholder confidence in Adapt IT and its development strategy,” says Adapt IT CEO, Sbu Shabalala.
The Board declared its 12th ordinary dividend of 8,23 cents per share, payable in September, which represents a four times
dividend cover ratio and a 48% increase on the prior year’s dividend. The Company has a policy of declaring a dividend at the
end of the financial year and not at the interim reporting date.
During the period under review, Adapt IT acquired the Aquilon group of companies, which now forms part of the
Adapt IT Energy Sector. “This acquisition has provided entry into the Oil & Gas industry, extending our SAP solution competence,
introducing supply chain management solutions and offering Adapt IT excellent future growth potential,” says Shabalala.
Adapt IT is well diversified across its four key operating segments. The Education Sector contributing 30%, Manufacturing
Sector 37%, Energy 17% and Financial Services Sector 16% of turnover.
The Group has succeeded in its international expansion with 25% of its turnover from foreign business with a specific focus on the
rest of Africa: “We provide software and services to 14 other African countries and a further 6 countries beyond Africa and this
is a key factor in diversifying risk and growing our dollar-based revenues,” says Shabalala.
He says that Adapt IT has made resolute decisions to strengthen its position as a leading IT solutions and services provider:
“We have an improved structure, a more diversified portfolio and are solidly positioned to unlock further organic growth combined
with additional strategic acquisitions.”
The strong track record in financial performance has enabled Adapt IT to continue investment in product development, infrastructure,
people and operational systems that support its organic and acquisitive growth initiatives.
Adapt IT recognises that people are imperative to ensuring success in today’s globally integrated and increasingly competitive
business environment. “People represent one of Adapt IT’s most significant investments. A total of R3,4 million was invested in skills
development in 2014 to ensure that the culture of training and providing opportunities for employees to grow is part of our ethos,”
says Shabalala.
Furthermore, the Company remains committed to the pillars of sustainability, encompassing economic, employment, social, and
environmental practices and has paid particular attention to aligning with the new Broad–Based Black Economic Empowerment Codes.
Adapt IT’s core values include integrity, passion, transparency, mutual respect, solution focus and good corporate citizenship.
These values serve as a guide when making business decisions and in dealings with all stakeholders, including colleagues, customers,
investors, suppliers, the community and the environment.
“Our approach to sustainability is based on a holistic view of Prosperity, People and Planet (3Ps). Being a sustainable organisation
means that we balance and integrate the 3Ps into our business decisions,” says Shabalala.
Adapt IT’s Social Responsibility initiatives in 2014 included the opening of the second Adapt IT Knowledge Centre at
Steve Tshwete Secondary School in Olievenhoutbosch, enriching the lives of 990 learners and 33 educators. The Knowledge Centre will
serve as a fully equipped computer lab with laptops, a printer, smart board and connectivity. This is the second Knowledge Centre
opened by Adapt IT in as many years and forms part of a R1,1 million social investment drive aimed at empowering future leaders
in the ICT Sector.
CHANGES TO THE BOARD DURING THE YEAR UNDER REVIEW
There have been no changes to the board during the year.
APPRECIATION
The Board extends its sincere thanks to Adapt IT's long-standing and new customers, suppliers, partners, shareholders
and service providers for their ongoing support of Adapt IT. In addition, the Board thanks Adapt IT's staff, without whose
dedication, hard work, enthusiasm, team spirit, skills and appetite for growth and change, the Group would not be the
industry leader it is today.
DIVIDENDS: ORDINARY DIVIDEND NUMBER 12
The Board has set a policy of considering a dividend once annually, after the year-end. The Board has declared a
dividend on a dividend cover ratio of four times as the Group wishes to retain a significant proportion of profits for
future growth activities.
The Group will have sufficient working capital to meet its requirements after the dividend payment. Notice is hereby
given that a cash dividend of 8,23 cents per share (the dividend) has been declared for the year ended 30 June 2014,
payable to shareholders recorded in the books of the Company at close of business on 12 September 2014.
In terms of the Listings Requirements of the JSE Limited regarding the new Dividends Tax effective 1 April 2012, the
following additional information is disclosed:
- This is a dividend as defined in the Income Tax Act, 1962, and is payable from income reserves;
- The South African dividend tax (DT) rate is 15%;
- No credits in terms of secondary tax on companies have been utilised. Accordingly, the dividend to utilise in
determining the DT is 8,23 cents per share;
- The DT to be withheld by the Company amounts to 1,2345 cents per share;
- Therefore, the net dividend payable to shareholders who are not exempt from DT is 6,9955 cents per share, while
the gross dividend of 8,23 cents per share is payable to those shareholders who are exempt from DT;
- The issued share capital of Adapt IT at the declaration date comprises 115 776 318 ordinary shares;
- Adapt IT’s registration number is 1998/017276/06; and
- Adapt IT’s income tax reference number is 9410/002/71/2.
Shareholders are advised that the last day to trade cum-dividend will be Friday, 5 September 2014. Shares will trade
ex-dividend as from Monday, 8 September 2014, and the record date will be Friday, 12 September 2014. Payment will
be made on Monday, 15 September 2014. Share certificates may not be dematerialised or rematerialised during
the period Monday, 8 September 2014 to Friday, 12 September 2014, both days inclusive. This dividend, having been
declared after 30 June 2014, has not been provided for in the financial statements.
NOTICE OF THE ANNUAL GENERAL MEETING AND POSTING OF INTEGRATED ANNUAL REPORT
The integrated annual report will be mailed to shareholders on 2 September 2014 and is available 18th August 2014, on
the Group’s website: www.adaptit.co.za.
Notice is hereby given that the 15th Annual General Meeting of shareholders of Adapt IT will be held at 09:00 am on
Friday, 7 November 2014 at the office of the Company at 5 Rydall Office Park, Rydall Vale Crescent, La Lucia Ridge,
Kwa-Zulu Natal. The board of directors of the Company determined that, in terms of section 62(3)(a), as read with
section 59 of the Companies Act, 2008 (Act 71 of 2008), the record date for the purposes of determining which shareholders
of the Company are entitled to participate in and vote at the Annual General Meeting is Wednesday, 31 October 2014.
Accordingly, the last day to trade Adapt IT shares in order to be recorded in the register to be entitled to vote will be
Friday, 24 October 2014.
DIRECTORS
Craig Chambers* (Chairman), Sbu Shabalala (Chief Executive Officer),
Tiffany Dunsdon (Financial Director), Bongiwe Ntuli*,
Thembisa Dingaan*, Oliver Fortuin*
*Independent non-executive director
REGISTERED OFFICE
5 Rydall Vale Office Park
Rydall Vale Crescent
La Lucia Ridge
KwaZulu-Natal
POSTAL ADDRESS
PO Box 5207
Rydall Vale Park
La Lucia Ridge Office Estate
Durban, 4019
TRANSFER SECRETARY
Computershare Investor Services (Pty) Ltd
70 Marshall Street, Johannesburg, 2001
(PO Box 61051, Marshalltown, 2107)
SPONSOR
Merchantec Capital
COMPANY SECRETARY
Statucor (Pty) Ltd
AUDITORS
Deloitte & Touche
Durban
18 August 2014
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