29 Nov 2013 07:00
29 November 2013
iEnergizer Limited
("iEnergizer" or "the Company")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2013
iEnergizer is one of the largest AIM listed independent, integrated software and service pioneersis pleased to announce its Interim Results for the six months ended 30 September 2013. iEnergizer is a high growth, digital publishing and technology leader set to benefit from the dual disruptive waves of big data and the cloud. This new leader was born out of the combination of a well-established, high growth, business process solution enterprise with the only scale provider of leading end-to-end digital transformation solutions to the media and publishing industries. The shift to the digital world is at a tipping point and iEnergizer has a unique position with cutting edge technology to serve as an enabler to its clients to help them during this transformational period.
Financial Highlights
· Revenue at $72.8m (6 months ended 30 September 2012: $72.1m)
· Operating profit $16.8m (6 months ended 30 September 2012: $17.1m)
· Operating profit margin at 23.1% (6 months ended 30 September 2012: 23.7%)
· Profit after tax at $9.5m (6 months ended 30 September 2012: $12.5m)
· Net debt of $113.4m as of 30 September 2013 (30 September 2012: $112.4m)
Operational Highlights
· Strong performance from content delivery, which now represents almost 70 per cent of our revenues. With the continued rise of digital media and the popularity of video gaming we expect this strong growth trend to continue.
· Content delivery, back office services and real time processing performed to budget.
· Continued focus on recurring revenue streams from business critical processes and long term customer relationships.
Sara Latham, Chairman said:
"We are very pleased with the performance of iEnergizer in the first half of the year. Our robust performance has been driven by the fact that we are deeply embedded within our clients' business critical processes. This has led to a high proportion of recurring revenues and best in class margins. We believe there is significant opportunity for us to continue to expand the business further using this approach."
-Ends-
Enquiries:
iEnergizer | c/o FTI Consulting 020 7831 3113 |
Anil Aggarwal, Chief Executive | |
Arden Partners | 020 7614 5900 |
Steve Douglas/Adrian Trimmings | |
FTI Consulting | 020 7831 3113 |
Jonathon Brill/Edward Westropp | |
Notes to Editors:
About iEnergizer
iEnergizer is one of the largest AIM listed independent, integrated software and service pioneers. iEnergizer is a high growth, digital publishing and technology leader set to benefit from the dual disruptive waves of big data and the cloud. This new leader was born out of the combination of a well-established, high growth, business process solution enterprise with the only scale provider of leading end-to-end digital transformation solutions to the media and publishing industries. The shift to the digital world is at a tipping point and iEnergizer has a unique position with cutting edge technology to serve as an enabler to its clients to help them during this transformational period.
Combining 12 years of experience and comprehensive capabilities across all industries and business functions, iEnergizer collaborates with clients to help them become high-performance businesses and provide significant cost advantage in their respective operations.
iEnergizer is a strategic outsourced service partner to various companies who are market leaders in their respective segments, across various industries including BFSI, Media & Entertainment, Publication, Content Process Solutions, Healthcare, Technology and FMCG.
iEnergizer provides services across the entire customer lifecycle and offers a comprehensive suite of Transaction Processing, Content & Publishing Process Outsourcing Solutions and Customer Management Services like Customer Acquisition, Customer Care, Technical Support, Billing & Collections, Dispute Handling and Market Research & Analytics using various platforms including Voice - Inbound & Outbound, Back-Office support, Online Chat, Mail Room and other web services.
Chairman's Statement
I am pleased to report the iEnergizer interim figures for the six month period to 30 September 2013. Following the acquisition of Aptara in 2012, iEnergizer has successfully integrated the business extending its best practice approach offered within its BPO operations to the content transformation solutions provided by Aptara. This process has transformed the Company into a best-in-class, high growth, high margin leader offering a full suite of content transformation solutions and business process solutions focused on the media, publishing and video gaming industries.
iEnergizer has a strong track record of financial delivery, much of which has been attributable to organic growth. The Company's focus remains on higher margin work in the non-voice based processes including legal process outsourcing, XBRL and content technology.
iEnergizer has continued to benefit from the long-term relationships we have with our blue chip client base. We have approximately 350 active clients and the average relationship length across our top ten clients is 8 years. We are deeply embedded in our clients' business critical processes. The strength of these relationships has led to a pipeline of sizeable new contracts which have been won during the period, a number of which are due to commence during the second half the financial year.
Financial Overview
Revenue for the six month period ended 30 September 2013 increased by 1% to $72.8m (6 months ended 30 September 2012: $72.1m). Operating profit fell modestly by 1.8% to $16.8m (6 months ended 30 September 2012: $17.1m), as operating margins, which are often second half weighted, softened slightly to 23.1% (6 months ended 30 September 2012: 23.7%).
Following the refinancing, announced on 2 May 2013, the interest rate payable by the Company on its banking facilities increased marginally. As a result of this increased charge, profit after tax reduced to $9.5m (6 months ended 30 September 2012: $12.5m).
Net debt stands at $113m as a result of the acquisition financing. The Board does not propose to pay an interim dividend as it looks to pay down the debt which resulted from the acquisition financing.
Business Review
The period under review has seen significant activity and we are moving ahead satisfactorily. The business comprises of three core divisions:
· Content delivery
· Back office services
· Real time processing
Content delivery
The content delivery division was borne out of the Aptara acquisition in February 2012. The division is a global content technology solutions leader as it is the only scale provider of end-to-end solutions across digital content production, publishing, distribution and technology development. Key to the division's success is the ability to take source content from any format and transform it for distribution through any medium.
Our core content delivery business performed strongly with revenues of $51.6m, an increase of 9.8% compared to the same period last year. Content delivery with its end-to-end transformational services now represents almost 70% of our revenues. With the continued rise of digital media and the popularity of video gaming, we expect this strong growth trend to continue.
Back office services
Back office services offers more traditional BPO services across multiple industries and geographies. The division's strength lies in its focus on quality and execution. As a result, the division has over recent reporting periods been rationalising certain lower margin revenue streams to focus on delivering services the high margin BPO activities.
Revenues in back office services reduced to $14.5m, down 26.9% as the rationalisation away from lower margin contracts continued through the period.
Real time processing
Working hand-in-hand with content delivery, real time delivery requires the company to be able to deliver content across a range of lap tops, smart phones and tablets. The US remains a key market but Europe is becoming increasingly important. Demand for the Company's services is driven by the digitalisation process. The digitialisation process is not limited to mobile devices and cuts across all industries and consumer and enterprise behavior.
Real time processing also performed strongly with revenues of $7.8m, up 24.3% when compared to the comparative period.
Current Trading and Outlook
Our robust performance was driven by the fact that we are deeply embedded within our clients' business critical processes. This has led to a high proportion of recurring revenues and best in class margins. We believe there is significant opportunity for us to continue to expand the business further using this approach. Trading is in-line with market expectation for the full year figures to March 2014, as we continue to grow the content delivery business.
Sara Latham
Non-Executive Chairman
Unaudited Condensed Consolidated Statements of Financial Position
(All amounts in United States Dollars, unless otherwise stated)
Notes | As at | As at | |||
30 September 2013 | 31 March 2013 | ||||
Unaudited | Audited | ||||
ASSETS | |||||
Non-current | |||||
Goodwill | 4 | 102,269,366 | 102,289,911 | ||
Other intangible assets | 5 | 29,515,210 | 31,677,970 | ||
Property, plant and equipment | 6 | 3,742,705 | 3,867,301 | ||
Long term financial asset | 793,665 | 1,676,923 | |||
Deferred tax asset | 13,715,657 | 12,151,517 | |||
Non-current assets | 150,036,603 | 151,663,622 | |||
Current | |||||
Trade and other receivables | 30,420,337 | 28,150,952 | |||
Cash and cash equivalents | 13,910,568 | 20,903,133 | |||
Short term financial assets | 3,573,879 | 4,519,265 | |||
Current tax asset | 321,927 | 484,752 | |||
Other current assets | 1,925,092 | 1,821,779 | |||
Current assets | 50,151,803 | 55,879,881 | |||
Total assets | 200,188,406 | 207,543,503 | |||
EQUITY AND LIABILITIES | |||||
Equity | |||||
Share capital | 3,195,334 | 3,195,334 | |||
Share compensation reserve | 63,986 | 63,986 | |||
Additional paid in capital | 11,009,480 | 11,009,480 | |||
Merger reserve | (1,049,386) | (1,049,386) | |||
Retained earnings | 32,651,699 | 23,180,758 | |||
Currency translation reserve | (7,340,843) | (2,897,780) | |||
Total equity | 38,530,270 | 33,502,392 |
Notes | ||||||||
As at | As at | |||||||
30 September 2013 | 31 March 2013 | |||||||
Unaudited | Audited | |||||||
Liabilities | ||||||||
Non-current | ||||||||
Long term borrowings | 113,384,026 | 772,126 | ||||||
Employee benefit obligations | 4,557,022 | 4,585,759 | ||||||
Other non-current liabilities | 245,532 | 135,257 | ||||||
Deferred tax liability | 6,057,530 | 6,940,771 | ||||||
Non-current liabilities | 124,244,110 | 12,433,913 | ||||||
Current | ||||||||
Trade and other payables | 8,649,115 | 16,993,092 | ||||||
Employee benefit obligations | 891,460 | 904,318 | ||||||
Short term financial liabilities | 7 | 2,321,858 | - | |||||
Current tax liabilities | 3,010,888 | 1,837,325 | ||||||
Current portion of long term borrowings | 13,943,783 | 518,063 |
| |||||
Short term borrowings | - | 132,500,000 | ||||||
Other current liabilities | 8,596,922 | 8,854,400 | ||||||
Current liabilities | 37,414,026 | 161,607,198 | ||||||
Total equity and liabilities | 200,188,406 | 207,543,503 | ||||||
(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)
Unaudited Condensed Consolidated Income Statements
(All amounts in United States Dollars, unless otherwise stated)
Notes | For the six months ended | For the six months ended |
| ||||||||
30 September 2013 | 30 September 2012 |
| |||||||||
Unaudited | Unaudited |
| |||||||||
| |||||||||||
Revenue |
| ||||||||||
Rendering of services | 72,754,074 | 72,080,141 |
| ||||||||
Other operating income | 1,170,575 | 973,396 |
| ||||||||
73,924,649 | 73,053,537 |
| |||||||||
| |||||||||||
Cost and expenses |
| ||||||||||
Outsourced service cost | 15,435,477 | 18,183,174 |
| ||||||||
Employee benefits expense | 29,443,193 | 26,198,014 |
| ||||||||
Depreciation and amortisation | 3,386,724 | 3,276,806 |
| ||||||||
Other expenses | 8,821,148 | 8,278,894 |
| ||||||||
57,086,542 | 55,936,888 |
| |||||||||
| |||||||||||
Operating profit | 16,838,108 | 17,116,649 |
| ||||||||
Finance income | 205,386 | 40,888 |
| ||||||||
Finance cost | (5,459,955) | (4,218,838) |
| ||||||||
Profit before tax | 11,583,539 | 12,938,699 |
| ||||||||
| |||||||||||
Income tax expense | 2,112,598 | 461,631 |
| ||||||||
Profit for the year attributable to equity holders of the parent | 9,470,941 | 12,477,068 |
| ||||||||
| |||||||||||
Earnings per share |
| ||||||||||
Basic | 8 | 0.06 | 0.08 | ||||||||
Diluted | 0.06 | 0.08 | |||||||||
Par value of each share in GBP | 0.01 | 0.01 | |||||||||
(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)
Consolidated Statements of Other Comprehensive Income
(All amounts in United States Dollars, unless otherwise stated)
For the six months ended | For the six months ended | |||
30 September 2013 | 30 September 2012 | |||
Unaudited | Unaudited |
| ||||||||
Profit after tax for the year | 9,470,886 | 12,477,068 | ||||||
Exchange differences on translating foreign operations | (4,443,063) | (988,028) | ||||||
Total comprehensive income attributable to equity holders | 5,027,823 | 11,489,040 | ||||||
(The accompanying notes are an integral part of these UnauditedCondensed Consolidated Interim Financial Statements)
Unaudited Condensed Consolidated Statements of Changes in Equity
(All amounts in United States Dollars, unless otherwise stated)
Share capital | Additional paid in Capital | Share compensation reserve | Merger reserve | Currency translation reserve | Retained earnings | Total equity | ||||||||
Balance as at 01 April 2012 | 3,195,334 | 11,009,480 | 63,986 | (1,049,386) | (1,166,752) | 19,201,520 | 31,254,182 | |||||||
Issue of ordinary shares | - | - | - | - | - | - | - | |||||||
Dividends | - | - | - | - | - | (19,439,097) | (19,439,097) | |||||||
Transaction with owners | - | - | - | - | - | (19,439,097) | (19,439,097) | |||||||
Profit for the year | - | - | - | - | - | 23,418,335 | 23,418,335 | |||||||
Other comprehensive income | - | - | - | - | - | - | - | |||||||
Exchange difference on translating foreign operations | - | - | - | - | (1,731,028) | - | (1,731,028) | |||||||
Total comprehensive income for the year | - | - | - | - | (1,731,028) | 23,418,335 | 21,687,307 | |||||||
Balance as at 31 March 2013 |
| |||||||||||||
(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)
Unaudited Condensed Consolidated Statements of Changes in Equity
(All amounts in United States Dollars, unless otherwise stated)
Share capital | Additional Paid in Capital | Share compensation reserve | Merger reserve | Currency translation reserve | Retained earnings | Total stockholders' equity | |
Balance as at 01 April 2013 | 3,195,334 | 11,009,480 | 63,986 | (1,049,386) | (2,154,780) | 12,239,490 | 23,304,124 |
Dividends | - | - | - | - | - | - | - |
Share based compensation | - | - | - | - | - | - | - |
Transaction with owners | - | - | - | - | - | - | - |
Profit for the period | - | - | - | - | 9,470,941 | 9,470,941 | |
Other comprehensive income | |||||||
Exchange difference on translating foreign operations | - | - | - | (4,443,063) | - | (4,443,063) | |
Total comprehensive income for the period | - | - | - | - | (4,443,063) | 9,470,941 | 5,027,823 |
Balance as at 30 September 2013 | 3,195,334 | 11,009,480 | 63,986 | (1,049,386) | (7,340,843) | 32,651,699 | 38,530,270 |
(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)
Unaudited Condensed Consolidated Statements ofCash Flows
(All amounts in United States Dollars, unless otherwise stated)
Notes | For the six months ended | For the six months ended | |
30 September 2013 | 30 September 2012 | ||
Unaudited | Unaudited | ||
(A) Cash flow from operating activities | |||
Profit before tax | 11,583,539 | 12,938,699 | |
Adjustments | |||
Depreciation and amortization | 3,386,724 | 3,276,806 | |
Loss on disposal of property, plant and equipment | - | 9,470 | |
Profit on disposal of property, plant and equipment | (7,783) | - | |
Trade receivables written-off | 37,000 | 150,362 | |
Foreign exchange loss | (1,129,208) | (784,460) | |
Finance income | (205,386) | (40,888) | |
Finance cost | 5,459,955 | 4,218,838 | |
19,124,840 | 19,768,827 | ||
Changes in operating assets and liabilities | |||
Trade and other receivables | (3,191,226) | (3,915,172) | |
Other assets | 984,146 | 643,924 | |
Non-current liabilities, trade payables & other current liabilities | (6,973,683) | (7,200,367) | |
Increase / (Decrease) in employee benefit obligations | (57,609) | - | |
Cash generated from operations | 9,886,468 | 9,297,212 | |
Income taxes paid | (3,223,590) | 11,861,713 | |
Net cash generated from operating activities | 6,662,878 | 21,158,925 | |
(B) Cash flow for investing activities | |||
Interest received | 205,386 | 40,888 | |
Payments for purchase of property plant and equipment | (1,481,943) | (1,141,138) | |
Net cash used in investing activities | (1,276,556) | (1,100,250) |
Notes | For the six months ended | For the six months ended | |
30 September 2013 | 30 September 2012 | ||
Unaudited | Unaudited |
(C ) Cash flow from financing activities | |||
Proceeds/(Repayment) of long term borrowings | 126,037,620 | 3,149 | |
Proceeds/(Repayment) of short term borrowings | (132,500,000) | - | |
Dividends paid to equity holders of the parent | - | (19,439,098) | |
Interest paid | (5,459,955) | (4,218,838) | |
Net cash used in financing activities | (11,922,335) | (23,654,787) | |
Net decrease in cash and cash equivalents | (6,536,013) | (3,596,112) | |
Cash and cash equivalents at the beginning of the period | 20,903,133 | 11,478,220 | |
Effect of exchange rate changes on cash | (456,552) | (988,028) | |
Cash and cash equivalents at the end of the period | 13,910,568 | 6,894,080 | |
Cash and cash equivalents comprise | |||
Cash in hand | 12,806 | 26,371 | |
Balances with banks in current account | 13,800,424 | 5,092,843 | |
Balances with banks in deposit account | 97,338 | 1,774,866 | |
Total | 13,910,568 | 6,894,080 |
(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)
Notes to Unaudited Condensed Consolidated Interim Financial Statements
(All amounts in United States Dollars, unless otherwise stated)
1. INTRODUCTION
iEnergizer Limited (the 'Company' or 'iEnergizer ') was incorporated in Guernsey on 12 May 2010 pursuant to the Act of Royal Court of the Island of Guernsey.
iEnergizer Limited is a 'Company limited by shares' and is domiciled in Guernsey. The registered office of the Company is located at Mont Crevelt House, Bulwer Avenue, St. Sampson, Guernsey, GY2 4 LH. iEnergizer was listed on the Alternative Investment Market ('AIM') of London Stock Exchange on 14 September 2010.
iEnergizerthrough its subsidiaries iEnergizer Holdings Limited, iEnergizer Group FZ - LLC, iEnergizer IT Services Private Limited, iEnergizer Management Services Limited, iEnergizer BPO Limited, iEnergizer Aptara Limited and Aptara Inc and subsidiaries. (together the 'Group') is engaged in the business of call centre operations, providing business process outsourcing (BPO) and content delivery services, and back office services to their customers, who are primarily based in the United States of America and India, from its operating offices in Mauritius and India.
2. GENERAL INFORMATION AND STATEMENT OF COMPLIANCE WITH IFRS
These Unaudited Condensed Consolidated Interim Financial Statements are for the six months ended 30 September 2013. They have been prepared in accordance with IAS 34 Interim Financial Reporting as developed and published by the International Accounting Standards Board ('IASB'), on a going concern basis. They do not include all of the information required in annual financial statements in accordance with IFRS, and should be read in conjunction with the Unaudited Condensed Consolidated Interim Financial Statements of the Group for the six months ended 30 September 2013.
The Unaudited Condensed Consolidated Interim Financial Statements have been prepared and presented in United States Dollar (US$) which is the Company's functional currency.
These Unaudited Condensed Consolidated Interim Financial Statements were approved by the Board on 28 November 2013.
The Group has applied the same accounting policies in preparing these unaudited management financial information as adopted in the most recent annual audited financial information of the Group.
3. BASIS OF CONSOLIDATION
Details of the entities, which as of 30 September 2013 form part of the Group and are consolidated under iEnergizer are as follows:
Name of the entity | Holding company | Country of incorporation | Effective group shareholding (%) as of 30 September 2013 |
iEnergizer Holdings Limited ('IHL') | iEnergizer | Mauritius | 100 |
iEnergizer IT Services Private Limited ('IITS') | IHL | India | 100 |
iEnergizer Group FZ - LLC ('IEG') | iEnergizer | Dubai | 100 |
iEnergizer BPO Limited | IHL | Mauritius | 100 |
iEnergizer Management Services Limited | IHL | Hong Kong | 100 |
Aptara Inc. | iEnergizer | USA | 100 |
Techbooks International Private Limited | Aptara Inc. | India | 100 |
Techbooks Electronic Services Private Limited | Aptara Inc. | India | 100 |
Global Content Transformation Private Limited | Aptara Inc. | India | 100 |
Maximize Learning Private Limited | Aptara Inc. | India | 100 |
Aptara Learning Private Limited | Aptara Inc. | India | 100 |
Aptara New Media Private Limited | Aptara Inc. | India | 100 |
Aptara Technologies Private Limited | Aptara Inc. | India | 100 |
iEnergizer Aptara Limited | iEnergizer | Mauritius | 100 |
All inter-company transactions and balances are eliminated on consolidation and the Unaudited Condensed Consolidated Interim Financial Statements reflect external transactions only. The accounting periods of the subsidiaries are co-terminus with that of the Company.
4. GOODWILL
The net carrying amount of goodwill can be analysed as follows:
Particulars | Amount |
Balance as at 01 April 2012 | 102,300,503 |
Impairment loss recognised | - |
Translation adjustment | (83,886) |
Balance as at 30 September 2012 | 102,216,617 |
Particulars | Amount |
Balance as at 01 April 2013 | 102,289,911 |
Impairment loss recognised | - |
Translation adjustment | (20,545) |
Balance as at 30 September 2013 | 102,269,366 |
5. OTHER INTANGIBLE ASSETS
The Intangible assets comprise of computer software, customer contracts.
Particulars | Customer Contracts | Computer software | Patent | Trade mark | Intangibles under development | Total |
Cost | ||||||
Balance as at 01 April 2012 | 24,161,846 | 712,350 | 100,000 | 12,000,000 | 270,114 | 37,244,310 |
Additions | - | 839,249 | - | - | - | 839,249 |
Disposals (Net) | - | (33,216) | - | - | (104,894) | (138,110) |
Translation adjustment | (11,848) | (47,025) | - | - | - | (58,873) |
Balance as at 31 March 2013 | 24,149,998 | 1,471,358 | 100,000 | 12,000,000 | 165,220 | 37,886,576 |
Accumulated amortization | ||||||
Balance as at 01 April 2012 | 1,081,658 | 221,418 | - | - | - | 1,303,076 |
Amortisation for the year | 4,219,358 | 744,057 | - | - | - | 4,963,415 |
Disposals (Net) | - | (30,762) | - | - | - | (30,762) |
Translation adjustment | (11,708) | (15,415) | - | - | - | (27,123) |
Balance as at 31 March 2013 | 5,289,308 | 919,298 | - | - | 0 | 6,208,606 |
Net carrying value as at 31 March 2013 | 18,860,690 | 552,060 | 100,000 | 12,000,000 | 165,220 | 31,677,970 |
Particulars | Customer Contracts | Computer software | Patent | Trade mark | Intangibles under development | Total |
| |
Cost |
| |||||||
Balance as at 01 April 2013 | 24,149,998 | 1,471,357 | 100,000 | 12,000,000 | 165,220 | 37,886,575 |
| |
Additions | - | 444,876 | - | - | - | 444,876 |
| |
Disposals (Net) | - | - | - | - | - | - | ||
Translation adjustment | (22,977) | (216,860) | - | - | (10,710) | (250,547) |
| |
Balance as at 30 September 2013 | 24,127,021 | 1,699,373 | 100,000 | 12,000,000 | 154,510 | 38,080,904 |
| |
| ||||||||
Accumulated amortization |
| |||||||
Balance as at 01 April 2013 | 5,298,841 | 879,053 | - | - | - | 6,177,894 |
| |
Amortisation for the period | 2,111,746 | 410,980 | - | - | - | 2,522,726 |
| |
Disposals (Net) | - | - | - | - | - |
| ||
Translation adjustment | (32,563) | (102,363) | - | - | - | (134,926) |
| |
Balance as at 30 September 2013 | 7,378,024 | 1,187,671 | - | - | - | 8,565,694 |
| |
Net carrying value as at 30 September 2013 | 16,748,997 | 511,702 | 100,000 | 12,000,000 | 154,510 | 29,515,210 |
| |
6. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment comprise of the following:
Particulars | Computer and data equipment | Office equipment | Furniture and fixtures | Air conditioner and generator | Vehicle | Leasehold improvements | Plant and machinery | Capital lease asset | Capital work in progress | Total |
Cost | ||||||||||
Balance as at 01 April 2012 | 1,270,082 | 136,640 | 358,204 | 149,997 | 19,399 | 707,347 | 735,793 | 967,458 | 413,780 | 4,758,700 |
Additions | 830,315 | 40,038 | 37,950 | 1,264 | 14,885 | 375,839 | 196,097 | 714,477 | 104,894 | 2,315,759 |
Disposals (Net) | (138,656) | (5,216) | (32,374) | - | - | - | (178,173) | (270,856) | (474,838) | (1,100,113) |
Translation adjustment | (80,381) | (8,605) | (19,082) | (9,587) | (1,241) | (44,911) | (41,920) | (60,479) | (43,836) | (310,042) |
Balance as at 31 March 2013 | 1,881,360 | 162,857 | 344,698 | 141,674 | 33,043 | 1,038,275 | 711,797 | 1,350,600 | - | 5,664,304 |
Accumulated depreciation | ||||||||||
Balance as at 01 April 2012 | 322,642 | 14,808 | 128,645 | 18,449 | 7,497 | 106,507 | 82,345 | 62,974 | - | 743,867 |
Depreciation for the period | 492,258 | 42,798 | 106,867 | 14,082 | 3,741 | 226,822 | 318,675 | 476,254 | - | 1,681,497 |
Disposals (Net) | (132,499) | (5,216) | (32,374) | - | - | - | (178,173) | (231,927) | - | (580,189) |
Translation adjustment | (21,393) | (1,024) | (7,887) | (1,206) | (486) | (6,961) | (4,621) | (4,594) | - | (48,172) |
Balance as at 31 March 2013 | 661,008 | 51,366 | 195,251 | 31,325 | 10,752 | 326,368 | 218,226 | 302,707 | - | 1,797,003 |
Net carrying values as at 31 March 2013 | 1,220,352 | 111,491 | 149,447 | 110,349 | 22,291 | 711,907 | 493,571 | 1,047,893 | - | 3,867,301 |
Particulars | Computer and data equipment | Office Equipment | Furniture & Fixtures | Airconditioner & Gererator | Vehicle | Leasehold Improvements | Plant & Machinery | Capital lease asset | Capital work in progress | Total |
Cost | ||||||||||
Balance as at 01 April 2013 | 1,881,359 | 162,856 | 344,699 | 141,674 | 33,043 | 1,038,274 | 711,796 | 1,350,600 | - | 5,664,301 |
Additions | 585,104 | 41,611 | 123,966 | 502 | - | (97,442) | 246,451 | 27,400 | 357,541 | 1,285,133 |
Disposals (Net) | (295,166) | (427) | (4,082) | - | - | - | (93,136) | - | - | (392,811) |
Translation adjustment | (300,922) | (24,197) | (43,330) | (18,780) | (2,406) | (129,764) | (89,312) | (197,525) | (597) | (806,832) |
Balance as at 30 September 2013 | 1,870,375 | 179,844 | 421,352 | 123,396 | 30,637 | 811,068 | 775,799 | 1,180,475 | 356,944 | 5,749,790 |
Accumulated depreciation | ||||||||||
Balance as at 01 April 2013 | 661,007 | 51,366 | 195,251 | 31,325 | 10,752 | 326,367 | 218,226 | 302,706 | - | 1,797,000 |
Depreciation for the period | 292,340 | 23,629 | 77,111 | 6,522 | 3,534 | 100,123 | 137,648 | 223,091 | - | 863,998 |
Disposals (Net) | (289,491) | (427) | (2,916) | - | - | - | (92,100) | - | - | (384,933) |
Translation adjustment | (82,164) | (8,112) | (24,466) | (4,560) | (1,634) | (47,581) | (21,324) | (79,138) | - | (268,980) |
Balance as at 30 September 2013 | 581,692 | 66,456 | 244,980 | 33,287 | 12,652 | 378,909 | 242,450 | 446,659 | - | 2,007,085 |
Carrying values as at 30 September 2013 | 1,288,683 | 113,388 | 176,272 | 90,109 | 17,985 | 432,159 | 533,349 | 733,816 | 356,944 | 3,742,705 |
7. SHORT TERM FINANCIAL ASSETS
Particulars | 30 September 2013 | 31 March 2013 |
Security deposits | 764,994 | 24,625 |
Restricted cash | 2,173,092 | 3,093,644 |
Short term investments (fixed deposits with maturity less than 12 months) | 635,793 | 993,859 |
Derivative financial instruments | - | 397,712 |
Others | - | 9,425 |
3,573,879 | 4,519,265 | |
Short term investments comprise of investment through banks in deposits denominated in various currency units bearing fixed rate of interest.
8. EARNINGS PER SHARE
The calculation of the basic earnings per share is based on the profits attributable to ordinary shareholders divided by the weighted average number of shares in issue during the period.
Calculation of basic and diluted profit per share for the period ended 30 September 2013 is as follows:
Basic earnings per share
Particulars | 30 September 2013 | 30 September 2012 | |
Profit attributable to shareholders | 9,470,941 | 12,477,068 | |
Weighted average numbers shares outstanding | 153,010,000 | 153,010,000 | |
Basic earnings per share (USD) | 0.06 | 0.08 | |
Diluted earnings per share
Particulars | 30 September 2013 | 30 September 2012 | |
Profit attributable to shareholders | 9,470,941 | 12,477,068 | |
Potential ordinary shares* | 66,076 | 66,076 | |
Weighted average numbers shares outstanding | 153,076,076 | 153,076,076 | |
Diluted earnings per share (USD) | 0.06 | 0.08 | |
* Shares to be issued under share options granted
9. RELATED PARTY TRANSACTIONS
The related parties for each of the entities in the Group have been summarised in the table below:
Nature of the relationship | Related Party's Name |
I. Ultimate controlling party | Mr. Anil Agarwal |
II. Entities directly or indirectly through one or more intermediaries, control, are controlled by, or are under common control with, the reported enterprises |
EICR Limited (Parent of iEnergizer Limited) Barker Shoes Limited (Under common control)
|
III. Key management personnel ("KMP") and significant shareholders | Mr. Anil Agarwal (Ultimate Shareholder, EICR Limited) |
Mr. John Behar, (Director, iEnergizer Limited) | |
Ms. Sara Latham, (Director, iEnergizer Limited) | |
Mr. Chris De Putron (Director, iEnergizer Limited) Mr. Mark De La Rue (Director, iEnergizer Limited) | |
Disclosure of transactions between the Group and related parties and the outstanding balances is as under:
Transactions with parent company
Particulars | 30 September 2013 | 30 September 2012 |
Transactions during the period ended | ||
Dividend paid | - | 14,840,054 |
Interest paid | 2,586,927 | 1,030,385 |
Repayment of loan | 20,000,000 | - |
Balances at the end of | ||
Interest payable | - | 1,030,385 |
Demand loan facility | - | 20,000,000 |
Above payables from related parties bears an interest rate of 10% and are repayable on demand. Hence, the management is of the view that fair values of such receivables and payable closely approximates their carrying values.
Transactions with KMP and relative of KMP
Particulars | 30 September 2013 | 30 September 2012 |
Transactions during the period ended | ||
Short term employee benefits | ||
Remuneration paid to directors | ||
Sara Latham | 27,036 | 23,684 |
John Behar | 27,036 | 23,718 |
Chris De Putron | 7,838 | 7,993 |
Mark De La Rue | 7,838 | 7,993 |
Balances at the end of | ||
Total remuneration payable | 16,139 | 16,166 |
10. SEGMENT REPORTING
Management currently identifies the Group's three services lines real time processing, back office services and content delivery as operating segments on the basis of operations. These operating segments are monitored and strategic decisions are made on the basis of adjusted segment operating results.
The Chief Operating Decision Maker ("CODM") evaluates the Group's performance and allocates resources based on an analysis of various performance indicators by reportable segments. The Group's reportable segments are as follows:
1. Real time processing
2. Back office services
3. Content delivery
4. Others
The measurement of each segment's revenues, expenses and assets is consistent with the accounting policies that are used in preparation of the Unaudited Condensed Consolidated Interim Financial Statements. In addition, two minor operating segments, for which the quantitative thresholds have not been met, are currently combined below under 'Others'. Segment information can be analysed as follows for the reporting periods under review:
30 September 2013
Real time processing | Back office services | Content delivery | Others | Total |
Revenue | |||||
Revenue from external customers | 7,839,336 | 14,469,795 | 50,422,617 | 22,326 | 72,754,074 |
Other Operating Income | 559 | - | 1,151,467 | 18,549 | 1,170,575 |
Segment Revenue | 7,839,895 | 14,469,795 | 51,574,084 | 40,875 | 73,924,649 |
Cost of Outsourced Services | - | 8,301,920 | 7,133,557 | - | 15,435,477 |
Employee Benefit Expense | 5,113,373 | 750 | 24,312,614 | 16,456 | 29,443,193 |
Depreciation and Amortisation | 219,099 | - | 3,161,714 | 5,911 | 3,386,724 |
Other expenses | 624,012 | 217,196 | 7,176,302 | 803,637 | 8,821,147 |
Segment Operating Profit | 1,883,411 | 5,949,929 | 9,789,897 | (785,129) | 16,838,108 |
Segment assets | 6,276,777 | 14,410,574 | 101,205,934 | 78,295,110 | 200,188,395 |
30 September 2012
Real time processing | Back office services | Content delivery | Others | Total | |
Revenue from external customers | 6,304,873 | 19,795,763 | 45,917,677 | 61,827 | 72,080,140 |
Other operating revenue | 17,793 | 1,465 | 921,828 | 32,311 | 973,397 |
Segment revenues | 6,322,666 | 19,797,228 | 46,839,505 | 94,138 | 73,053,537 |
Cost of outsourced services | - | 12,884,937 | 5,298,237 | - | 18,183,174 |
Employee benefit expense | 3,886,455 | - | 22,253,429 | 58,130 | 26,198,014 |
Depreciation and amortisation | 197,119 | - | 3,073,635 | 6,052 | 3,276,806 |
Other expenses | 547,345 | 361,807 | 7,009,917 | 359,827 | 8,278,896 |
Segment operating profit | 1,691,747 | 6,550,484 | 9,204,287 | (329,871) | 17,116,647 |
Segment assets | 5,800,025 | 10,339,071 | 175,846,359 | 1,271,490 | 193,256,945 |
Revenue from two of the customer's amounted to more than 10% of consolidated revenue during the period presented.
30 September 2013
Revenue from | Segment | Amount |
Customer 1 | Content Delivery | 13,972,908 |
30 September 2012
Revenue from | Segment | Amount |
Customer 1 | Content Delivery | 15,951,787 |
11. FINANCIAL ASSETS AND LIABILITIES
Fair value of carrying amounts of assets and liabilities presented in the statement of financial position relates to the following categories of assets and liabilities:
Financial assets | 30 September 2013 | 31 March 2013 |
Non-current assets | ||
Loans and receivables | ||
Security deposits | 153,836 | 713,937 |
Restricted cash | 639,829 | 596,174 |
Deposits with banks | - | 365,898 |
Others | - | 914 |
Current assets | ||
Loans and receivables | ||
Trade receivables | 30,420,337 | 28,150,952 |
Cash and cash equivalents | 13,910,568 | 20,903,133 |
Restricted cash | 2,173,092 | 3,093,644 |
Security deposits | 764,994 | 24,625 |
Short term investments | 635,793 | 993,859 |
Other current assets | 1,925,092 | 1,821,779 |
Other short term financial assets | - | 9,425 |
Fair value through profit and loss: | ||
Derivative financial instruments | - | 397,712 |
50,623,541 | 57,072,052 | |
|
| |
Financial liabilities | 30 September 2013 | 31 March 2013 |
Non-current liabilities | ||
Financial liabilities measured at amortized cost: | ||
Long term borrowings | 113,384,026 | 772,126 |
Other non-current liabilities | 245,532 | 135,257 |
Current liabilities | ||
Financial liabilities measured at amortized cost: | ||
Trade payables | 8,649,115 | 16,993,092 |
Current portion of long term borrowings | 13,943,783 | 518,063 |
Short term borrowings | - | 132,500,000 |
Other current liabilities | 8,596,922 | 8,854,400 |
Fair value through profit and loss: | ||
Derivative financial instruments | 2,321,858 | - |
147,141,236 | 159,772,938 |
These non-current financial assets and liabilities, current financial assets and liabilities have been recorded at their respective carrying amounts as the management considers the fair values to be not materially different from their carrying amounts recognised in the statement of financial positions as these are expected to realise within one year from the reporting dates. Derivative financial instruments, recorded at fair value through profit and loss, are recorded at their respective fair values on the reporting dates.
12. FAIR VALUE HIERARCHY
Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
No financial assets/liabilities have been valued using level 1 and 3 fair value measurements.
The following table presents fair value hierarchy of assets and liabilities measured at fair value on a recurring basis:
30 September 2013 | Total | Fair value measurements at reporting date using | |
Level 2 | |||
Liabilities | (Notional amount) | ||
Derivative instruments | |||
Forward contracts (currency - USD/INR) | 18,500,000 | 2,321,858 | |
31 March 2013 | Total | Fair value measurements at reporting date using | |
Level 2 | |||
Assets | (Notional amount) | ||
Derivative instruments | |||
Forward contracts (currency - USD/INR) | 36,900,000 | 397,712 | |
13. BORROWINGS
The Company on 1 May 2013, along with one of its subsidiary, entered into USD 135,000,000 six year senior secured term loan facility with Jefferies Finance LLC which has been utilised to refinance and pay off in full the outstanding loans relating to the acquisition of Aptara.
14. ESTIMATES
The preparation of interim financial statements require management to make 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.
In preparing these Unaudited Condensed Consolidated Interim Financial Statements, the significant judgments made by the 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 31 March 2013.
15. FINANCIAL RISK MANAGEMENT
The Group's financial risk management objectives and policies are consistent with those disclosed in the consolidated financial statements as at and for the year ended 31 March 2013.