SUBX.L Regulatory News (SUBX)

SUBEX LIMITED

Registered office: Pritech Park - SEZ, Block-09, 4th Floor, B Wing, Survey No. 51-64/4, Outer ring road, Bellandur Village,Varthur Hobli, Bangalore -560 103

Statement of Unaudited Consolidated Financial Results for quarter and nine months ended December 31, 2021

( ₹ in Lakhs)

Quarter ended

Year to date figures for the nine months ended

Year ended

Particulars

December 31, 2021

September 30, 2021

December 31, 2020

December 31, 2021

December 31, 2020

March 31, 2021

Unaudited

Unaudited

Unaudited

Unaudited

Unaudited

Audited

1

Revenue from operations

8,774

8,630

9,388

25,464

27,587

37,203

2

Other income

69

97

106

837

302

474

3

Total income (1+2)

8,843

8,727

9,494

26,301

27,889

37,677

Expenses

Employee benefits expense (Refer note 4)

5,488

5,442

5,256

16,037

14,703

19,720

Finance costs

88

33

38

162

251

296

Depreciation and amortization expense

252

246

424

740

1,155

1,378

Other expenses

2,483

2,198

2,097

6,014

5,349

7,633

4

Total expenses

8,311

7,919

7,815

22,953

21,458

29,027

5

Profit before exceptional items and tax (3-4)

532

808

1,679

3,348

6,431

8,650

Exceptional items

Provision for service tax receivable

Gain on termination of lease agreement

-

-

-

-

(267)

(267)

-

-

-

-

554

554

6

Total exceptional items

-

-

-

-

287

287

7

Net profit before tax (5+6)

532

808

1,679

3,348

6,718

8,937

8

Tax expense, net

Current tax charge

Provision - foreign withholding taxes (Refer note 5)

Deferred tax (credit)/ charge (including MAT credit entitlement) (Refer note 6)

160

164

49

416

57

696

281

162

208

508

940

399

(117)

-

551

386

2,109

2,670

Total tax expense

324

326

808

1,310

3,106

3,765

9

Net profit for the period/ year (7-8)

208

482

871

2,038

3,612

5,172

10

Other comprehensive income/ (loss) net of tax expense

Items that will be reclassified subsequently to profit or loss:

Net exchange differences (loss)/ gain on translation of foreign operations

Items that will not be reclassified subsequently to profit or loss:

Re-measurement loss on defined benefit plan

(54)

(33)

455

63

575

636

(35)

(67)

(14)

(105)

(38)

(12)

Total other comprehensive (loss)/ income

(89)

(100)

441

(42)

537

624

11

Total comprehensive income for the period/ year (9+10)

119

382

1,312

1,996

4,149

5,796

12

Paid up equity share capital

28,100

28,100

28,100

28,100

28,100

28,100

[face value of ₹ 5 (March 31, 2021: ₹ 5)]

13

Other equity

-

-

-

-

-

26,755

14

Earnings per share (of ₹ 5/- each) (not annualised in case of the interim periods)

- Basic

0.04

0.09

0.16

0.37

0.67

0.96

- Diluted

0.04

0.09

0.16

0.37

0.66

0.94

1

Notes:

The above results have been reviewed by the Audit Committee and approved by the Board of Directors in their meeting held on January 31, 2022.

The financial results have been prepared in accordance with the recognition and measurement principles laid down in the applicable Indian Accounting Standards ("Ind AS") prescribed under section 133 of the Companies Act, 2013, read with relevant rules thereunder and in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.

The financial results of Subex Limited (Standalone information):

(  in Lakhs)

2

3

Quarter ended

Year to date figures for the nine months ended

Year ended

Particulars

December 31, 2021

September 30, 2021

December 31, 2020

December 31, 2021

December 31, 2020

March 31, 2021

Unaudited

Unaudited

Unaudited

Unaudited

Unaudited

Audited

Total income

Net (loss)/ profit before tax

Net (loss)/ profit for the period/ year

Total comprehensive (loss)/ income for the period/ year

2,080

(91)

(91)

(99)

1,559

49

49

32

510

125

129

127

5,210

227

227

202

2,937

1,465

1,465

1,460

5,510

2,651

2,622

2,622

4

Employee benefits expenses for the quarter ended December 31, 2021, September 30, 2021 and December 31, 2020 are net of reversal of provision no longer required, in respect of employee incentives, amounting to ₹ 184 Lakhs,

₹ 327 Lakhs and ₹ 43 Lakhs, respectively, and for the nine months ended December 31, 2021 and December 31, 2020 amounting to ₹ 786 Lakhs and ₹ 333 Lakhs, respectively and for the year ended March 31, 2021 amounting to ₹ 333 lakhs.

5

Represents reversal/provision in respect of foreign withholding taxes deducted/ deductible by the overseas customers of the Group. Considering the expected utilisation of foreign withholding taxes, provision of ₹ 723 Lakhs made during the earlier quarters, has been reversed during the year ended March 31, 2021.

6

Deferred tax charge/(credit), comprises of liability arising on account of tax benefits from amortisation of intangible assets of Subex Assurance LLP, net of deferred tax assets arising on account of carry forward losses and other taxable temporary differences, which arose mainly on account of business restructuring effected from November 1, 2017, wherein, the Company's RMS business and the Digital business was transferred on going concern basis to Subex Assurance LLP and Subex Digital LLP respectively. Effective April 1, 2021 considering the favourable order received, no additional liability is created in respect of aforesaid tax benefits.

7

The Group is engaged in the business of software products and related services, which are monitored as a single segment by the Chief Operating Decision Maker, accordingly, these, in the context of Ind AS 108 on Operating Segments Reporting are considered to constitute one segment and hence the Group has not made any additional segment disclosures.

8

The full impact of COVID - 19 still remains uncertain and could be different from the estimates considered while preparing these consolidated financial results. The Group shall continue to closely monitor any material changes to future economic conditions.

9

The US Federal government in the wake of COVID 19 pandemic provided support to business through Paycheck Protection Program (PPP). Subex Inc. obtained a benefit under this scheme for ₹600 Lakhs during May 2020. During the nine months period ended December 31, 2021, Subex Inc. obtained complete waiver of the loan amount from Small Business Administration, United States government agency and accordingly the loan and interest accrued thereon was recognised as other income.

10

The Board of Directors of the Company in its meeting held on October 28, 2021 has approved the restructuring of the business, subject to all requisite approvals, wherein the business carried out by Subex Assurance LLP will be transferred to Subex Limited on a 'going concern' basis excluding Developed Technology and Investment in subsidiaries. The aforesaid restructuring is being carried out to achieve higher operational efficiencies upon integration and consolidation of business in the listed entity. The Company has sought approval of shareholders through postal ballot notice dated January 17, 2022 and the result of e-voting will be announced on or before Friday, February 25, 2022.

11

On December 6, 2021, the Group experienced a cybersecurity incident related to ransomware. The Group could contain the incident in a timely basis and has also ensured that all traces of the infection are completely cleared from the network. All affected systems were restored and brought back to normalcy in the order of priority. The management has assessed the impact of the incident on the control environment and the financial statement process and conclude there was no material impact on the financial results. Since then, the Group has also been focused on implementing significant improvements to its cyber and data security systems to safeguard from such risks in the future.

Place: Bengaluru

Date: January 31, 2022

For further details on the results, please visit our website: www.subex.com

Vinod Kumar Padmanabhan Managing Director & CEO