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Short-Form Announcement: Abridged Audited Results for Year Ended 28 February 2023, Dividend Declaration & AGM Notice
ISA Holdings Limited
Incorporated in the Republic of South Africa
(Registration number: 1998/009608/06)
Share code: ISA
ISIN: ZAE000067344
(“ISA” or “the company” or “the group”)
SHORT-FORM ANNOUNCEMENT: ABRIDGED SUMMARISED CONSOLIDATED AUDITED RESULTS FOR
THE YEAR ENDED 28 FEBRUARY 2023, CASH DIVIDEND DECLARATION AND NOTICE OF
ANNUAL GENERAL MEETING.
Audited Audited
year year
ended ended
28 Feb 23 28 Feb 22
Change R'000 R'000
Highlights from Statement
of Comprehensive Income:
Revenue 1% 75 581 74 743
Profit before
Other income and expenses 0% 39 809 39 882
Earnings after tax 34% 21 872 16 354
Earnings and diluted earnings
per share (cents) 34% 14.0 10.5
Highlights from Statement of
Financial Position:
Total assets -10% 76 171 84 307
Cash and cash equivalents -32% 31 971 47 345
Equity -18% 57 814 70 348
Total liabilities -32% 18 357 13 959
Highlights from Statement of
Changes in Equity:
Dividends paid during the year 195% 34 406 11 657
Ordinary dividend per share
paid (cents) 88% 6.2 3.3
Special dividend per share
paid (cents) 100% 10.0 -
Interim dividend per share
paid (cents) 40% 6.0 4.3
Net asset value per share
at end of period (cents) -18% 37.1 45.1
Headline earnings per
share (cents) 34% 14.0 10.5
Diluted headline earnings per
share (cents) 34% 14.0 10.5
Notes to the statements:
RECONCILIATION OF HEADLINE EARNINGS
Earnings as per statement of comprehensive income 21 872 16 354
Headline earnings 21 872 16 354
Headline earnings per share (cents) 14.0 10.5
I am pleased to present our results for the full year ended 28 February 2023
("the current reporting period"), which continue to be underpinned by a high
portion of recurring revenue, a robust balance sheet and strong cash flows. In
the context of the exceptionally challenging trading conditions in which we
operate, together with the extreme pressure on the local economy, I am satisfied
with our performance and humbled by the tremendous support that we have received
from our staff, customers, suppliers, vendor partners and shareholders.
Financial
Revenue increased marginally to R75.6 million compared to R74.7 million in the
previous corresponding reporting period (“the prior reporting period”), of which
more than 90% of revenue is of a recurring nature and includes turnover from
both product subscription and our various Managed Security Service offerings.
Profit before other income and expenses decreased slightly to R39.8 million
during the current reporting period compared to R39.9 million in the prior
reporting period.
While the top-line increase is less than what we had hoped, I remain encouraged
by our resilience through these challenging times, as well as our ability to
curate and bring to market a range of new Professional and Managed security
services designed to support our customers through the rapidly evolving
information security and threat landscape. Notably, our expanded range of
Security Advisory and Security Assessment services has been well received during
the current reporting period and has afforded us deeper access into our
customers’ leadership structures and strategies, which in turn has opened new
avenues for future growth.
Other income increased by 72.3% to R3.3 million compared to R1.9 million in the
prior reporting period, largely resulting from the revaluation of our foreign
currency reserves which increased to R3.0 million from R1.6 million in the prior
reporting period. While these positive foreign currency revaluation adjustments
have been most welcomed over the years, management has decided to reduce their
foreign currency reserves in favour of the Rand to better align the business’
cash reserves to its expenditure profile, as well as to benefit from the higher
interest rates offered locally. The effect of this decision can already be seen
in the increased finance income of R1.4 million in the current reporting period
compared to R551 000 in the prior reporting period.
Operating expenditure increased by 22.5% to R25.9 million compared to R21.1
million in the prior reporting period, which is largely attributable to a
sizeable increase in payroll expenses. This increase relates to both organic
salary adjustments for existing staff, as well as the recruitment and
development of new talent needed to curate and spearhead growth in our broader
portfolio of offerings referred to previously.
On an exciting note, our share of profits from our equity-accounted investment
(“DataProof”) grew almost fivefold to R7.7 million compared to R1.6 million in
the prior reporting period, which is largely a result of a few sizeable public-
sector contracts awarded during the current reporting period. Over the last few
years, DataProof has been developing a range of services focusing primarily on
meeting the demand in the outsourced Security Operations Centre and Security
Information and Event Management markets. DataProof will be further developing
and investing into their service-centric business model with the intention of
delivering sustainable above-average growth into the future.
Earnings attributable to equity shareholders increased by 33.7% to R21.9 million
compared to R16.4 million in the prior reporting period, presented as an
increase in headline earnings per share and earnings per share to 14.0 cents
from 10.5 cents in the prior reporting period; and total comprehensive income
attributable to equity shareholders, which includes the revaluation of our
owner-occupied property in the prior reporting period, increased by 13.7% from
R19.2 million in the prior reporting period.
Distribution
During the current reporting period an interim dividend of R9.4 million for the
half year ended 31 August 2022 was declared and paid to shareholders,
representing a cash distribution of 6.0 cents per share. With the realisation
of earnings of 14.0 cents per share for the current reporting period, we are
now pleased to declare a final ordinary dividend to shareholders for the year
ended 28 February 2023 of 8.0 cents per share, which will be subject to dividend
tax legislation.
The board of directors of ISA (“board”) has reasonably concluded that the
company will satisfy the solvency and liquidity requirements immediately after
distribution thereof and for the next 12 months.
The salient dates for the ordinary dividend will be as follows:
Declaration date Friday, 26 May 2023
Last day to trade Tuesday, 18 July 2023
Shares trade ex-dividend Wednesday, 19 July 2023
Record date Friday, 21 July 2023
Payment date Monday, 24 July 2023
Share certificates may not be dematerialised or rematerialised between
Wednesday, 19 July 2023 and Friday, 21 July 2023, both days inclusive.
In terms of the dividend tax legislation, 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 20%.
- The DT to be withheld by the company in respect of the ordinary dividend
amounts to 1.60 cents per share.
- The net ordinary dividend payable to shareholders who are not exempt from
DT is therefore 6.40 cents per share, while a gross ordinary dividend
of 8.0 cents per share is payable to those shareholders who are exempt
from DT.
- The issued share capital of the company at the declaration date comprises
170 592 593 ordinary shares.
- The company’s income tax reference number is 9340/150/71/4.
Market and prospects
I continue to be optimistic about our long-term prospects, as the key drivers
of the information security market remain robust. With the continued evolution
and persistence of threats and attack vectors against organisational information
and IT resources, together with the increased regulatory and legislative
compliance requirements, stakeholders continue to elevate the importance of
security within their organisations. By leveraging this positive sentiment
towards the information and infrastructure security market, as well as our
positioning as a thought leader in this market segment, we are likely to continue
delivering above average tangible returns over time.
Conclusion
On behalf of the board, I would like to take this opportunity to thank the ISA
team for their continued dedication and hard work. My appreciation is also
extended to my colleagues on the board for their wise counsel and valuable
input. Finally, I thank all stakeholders, customers and vendors for their
support, and I look forward to meeting shareholders at the Annual General
Meeting to be held on Wednesday, 28 June 2023.
Integrated Annual Report
Shareholders are advised that the integrated annual report has been
distributed to shareholders and will be available on the company’s website at
www.isa.co.za.
Notice of Annual General Meeting
Notice is hereby given that the Annual General Meeting of shareholders of ISA
(“AGM”) will be held at 10:00 on Wednesday, 28 June 2023 through electronic
participation.
The salient information pertaining to the AGM is set out below:
Issuer name ISA Holdings Limited
Type of instrument Ordinary shares
ISIN number ZAE000067344
JSE code ISA
Meeting type Annual General Meeting
Meeting venue Virtual
Record date – to determine
which shareholders are entitled to
receive the notice Friday, 19 May 2023
Publication/Electronic distribution date Friday, 26 May 2023
Last day to trade – last day to trade to determine
eligible shareholders that may attend, speak and
vote at the AGM Tuesday, 20 June 2023
Record date – record date to determine eligible
Shareholders that may attend, speak and vote at
the AGM Friday, 23 June 2023
Meeting deadline date - (for administrative
purposes), forms of proxy for the AGM to be
lodged 10:00 on Monday, 26 June 2023
Virtual AGM date 10:00 on Wednesday, 28 June 2023
Publication of results Wednesday, 28 June 2023
Website link www.isaholdings.co.za
Shareholders who wish to participate electronically at the Annual General
Meeting are required to contact JSE Investor Services at
meetfax@jseinvestorservices.co.za; or alternatively contact JSE Investor
Services’ offices on +27 86 154 6572 as soon as possible, but in any event,
for administrative purposes only, by no later than 10:00 on Monday, 26 June
2023.
SHORT-FORM ANNOUNCEMENT
The content of this short-form announcement is the responsibility of the
directors of the company. The short-form announcement contains only a summary
of the information in the Abridged Summarised Consolidated Audited Results
for the year ended 28 February 2023 (“Full Announcement”) which is available
at: https://senspdf.jse.co.za/documents/2023/jse/isse/isa/ye23.pdf and is also
published on the company’s website at https://www.isa.co.za/sens/SENS-
20230526-01.pdf, and accordingly does not contain full or complete details.
Any investment decisions by investors or shareholders should be based on the
consideration of the Full Announcement.
The information in this short-form announcement has been extracted from the
Full Announcement, but the short-form announcement itself has not been
reviewed or audited by the company's auditors.
The abridged summarised consolidated audited results have been extracted from
the annual financial statements for the year ended 28 February 2023 which was
audited by Crowe JHB, who expressed an unmodified audit opinion. There were
no key audit matters to communicate in the auditor’s report. A copy of their
audit report and the group annual financial statements are available for
inspection at the company's registered office, Block 9 Pinewood Office Park,
33 Riley Road, Woodmead 2191 and on the company's website at www.isa.co.za
Copies of the short-form announcement and the Full Announcement will be
available for inspection at the registered offices of ISA or the Designated
Adviser, Merchantec Capital, during business hours. These announcements may
also be obtained at no cost on request from the Company Secretary who is
contactable on +27 11 325 6363 or isa@acorim.co.za
For and on behalf of the board,
Clifford Katz
Chief Executive Officer
Johannesburg
26 May 2023
Directors: CS Katz (Chief Executive Officer), PJG Green (Chief Technical
Officer), P Mogoboya (Financial Director), AJ Naidoo#, C. Pillay#, DC
Seaton*, N Maphothi*, O Seku*(Chairperson)
# Non-executive
* Independent non-executive
Designated Adviser: Merchantec Capital
www.isaholdings.co.za
Date: 26-05-2023 04:39:00
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