13 Nov 2017 10:01
November 13, 2017
To
The London Stock Exchange
10 Paternoster Square
London
EC4M 7LS
Dear Sir/Madam,
Sub: Outcome of the Board Meeting of Subex Limited held on November 10, 2017
Please be informed that the agenda items summarized hereunder were discussed and approved at the Board Meeting of Subex Limited (the "Company") held on November 10, 2017 at Bengaluru:
1. Unaudited standalone and consolidated financial results of the Company for the quarter and half year ended September 30, 2017
2. The Board noted that, pursuant to: (i) the in-principle approval accorded by the Board of Directors of the Company ("Board") at its meeting No. 2/ 2017-18 held on May 25, 2017; (ii) the final approval accorded by the Board at its meeting No. 5/ 2017-18 held on August 21, 2017; and (iii) the approval accorded by the members of the Company vide postal ballot on September 23, 2017, pursuant to restructuring of the business of the Company:
(i) Mr. Vinod Kumar Padmanabhan has ceased to be a whole-time director and is now a non-executive non-independent director of the Company.
(ii) Mr. Ashwin Chalapathy has ceased to be a whole-time director and is now a non-executive non-independent director of the Company.
Please find enclosed:
· Unaudited consolidated Financial Results of the Company for the quarter and half year ended September 30, 2017
We request you to take the aforesaid notification on record.
Yours faithfully
For and on behalf of Subex Limited
Arjun Makhecha
Acting Company Secretary
SUBEX LIMITED Registered office: RMZ Ecoworld, Outer Ring Road, Devarabisanahalli, Bangalore - 560 037 Statement of Unaudited Consolidated Financial Results for the quarter and six months ended September 30, 2017 | ( Rs.in Lakhs) | ||||||
Particulars | Quarter ended | Year to date figures for the six months ended | Year ended | ||||
September 30, 2017 | June 30, 2017 | September 30, 2016 | September 30, 2017 | September 30, 2016 | March 31, 2017 | ||
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Audited | ||
1 2 3 4 (a) (b) (c) (d) (e) 5 6 7 8 9 10 11 12 13 14 (a) (b) | Income Revenue from operations Other income (Refer note 8) | 8,106 16 | 7,618 59 | 8,336 268 | 15,724 75 | 16,670 497 | 35,733 1,154 |
Total income (1+2) | 8,122 | 7,677 | 8,604 | 15,799 | 17,167 | 36,887 | |
Expenses Employee benefits expense (Refer note 9) Finance costs Depreciation and amortisation expense Exchange fluctuation loss/ (gain), net Other expenses | 4,475 210 129 372 2,519 | 4,333 225 130 507 2,331 | 4,175 518 117 (211) 2,733 | 8,808 435 259 879 4,850 | 8,242 1,076 229 (1,029) 5,451 | 15,871 2,040 495 (698) 11,651 | |
Total expenses | 7,705 | 7,526 | 7,332 | 15,231 | 13,969 | 29,359 | |
Profit before exceptional items and tax (3-4) | 417 | 151 | 1,272 | 568 | 3,198 | 7,528 | |
Exceptional items, net (Refer note 7) | - | - | - | - | - | (10,890) | |
Net profit/ (loss) before tax (5+6) | 417 | 151 | 1,272 | 568 | 3,198 | (3,362) | |
Tax expense, net Current tax MAT charge / (credit) Deferred tax charge / (credit) | 50 62 1 | 292 (27) (13) | 298 - - | 342 35 (12) | 406 - - | 1,055 (94) - | |
Total tax expense | 113 | 252 | 298 | 365 | 406 | 961 | |
Net profit/ (loss) for the period / year (7-8) | 304 | (101) | 974 | 203 | 2,792 | (4,323) | |
Other comprehensive income, net of tax Items that will be reclassified subsequently to profit or loss: Net exchange differences on translation of foreign operations Items that will not be reclassified subsequently to profit or loss: Re-measurement (loss)/ gain on defined benefit plans | 291 7 | 284 (8) | (179) (65) | 575 (1) | (1,024) (66) | (1,344) (32) | |
Total other comprehensive income | 298 | 276 | (244) | 574 | (1,090) | (1,376) | |
Total comprehensive income for the period/ year (9+10) | 602 | 175 | 730 | 777 | 1,702 | (5,699) | |
Paid up equity share capital [face value of Rs. 10 (March 31, 2017: Rs. 10)] Other equity Earnings/(loss) per share (of Rs.10/- each) (not annualised in case of the interim periods) - Basic - Diluted | 56,200 - 0.05 0.05 | 56,200 - (0.02) (0.02) | 50,691 - 0.19 0.19 | 56,200 - 0.04 0.04 | 50,691 - 0.55 0.55 | 50,691 17,718 (0.85) (0.85) | |
SUBEX LIMITED Registered office: RMZ Ecoworld, Outer Ring Road, Devarabisanahalli, Bangalore - 560 037 Statement of Consolidated Assets and Liabilities | ( Rs.in Lakhs) | |||
Particulars | As at | |||
September 30, 2017 | March 31, 2017 | |||
Unaudited | Audited | |||
A 1 2 B 1 2 3 4 | ASSETS Non-current assets Property, plant and equipment Goodwill on consolidation Other intangible assets Financial assets Loans Other balances with banks Other financial assets Income tax asset (net) Deferred tax asset (MAT credit entitlement) Other non-current assets Current assets Financial assets Loans Trade receivables Cash and cash equivalents Other financial assets Other current assets Total assets (1+2) EQUITY AND LIABILITIES Equity Equity share capital Other equity Total equity Liabilities Non-current liabilities Provisions Current liabilities Financial liabilities Borrowings Trade payables Other financial liabilities Other current liabilities Provisions Income tax liabilities (net) Total liabilities (2+3) Total equity and liabilities (1+4) | 773 65,882 112 420 172 234 2,242 455 538 | 785 65,882 138 399 258 234 1,977 478 564 | |
70,828 | 70,715 | |||
151 12,332 4,531 4,196 873 | 196 11,851 7,386 4,508 1,013 | |||
22,083 | 24,954 | |||
92,911 | 95,669 | |||
56,200 20,695 | 50,691 17,718 | |||
76,895 | 68,409 | |||
309 | 297 | |||
309 | 297 | |||
8,314 1,422 1,310 3,102 719 840 | 8,590 1,805 11,922 3,085 677 884 | |||
15,707 | 26,963 | |||
16,016 | 27,260 | |||
92,911 | 95,669 | |||
Notes: | |||||||
1 2 3 4 5 6 7 8 9 | The above results have been reviewed by the Audit Committee and approved by the Board of Directors in their meeting held on November 10, 2017. 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 and SEBI Circular No. CIR/CFD/FAC/62/2016 dated July 5, 2016. The financial results of Subex Limited (Standalone information): ( Rs.in Lakhs) | ||||||
Particulars | Quarter ended | Year to date figures for the six months ended | Year ended | ||||
September 30, 2017 | June 30, 2017 | September 30, 2016 | September 30, 2017 | September 30, 2016 | March 31, 2017 | ||
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Audited | ||
Total income Net profit/(loss) before tax Net profit/(loss) for the period/ year Total comprehensive income for the period/ year | 7,794 389 310 3 10 | 7,132 434 324 316 | 7,766 401 321 264 | 14,926 823 634 626 | 15,657 1,047 958 900 | 33,694 (429) (683) (716) | |
During the three months ended June 30, 2017, the Company made an allotment of 55,094,999 equity shares of the Company on a preferential basis, at an issue price of Rs.14 per equity share (Face value of Rs. 10 per equity share) amounting to Rs. 7,713 Lakhs. On June 30, 2017, the Company redeemed outstanding FCCBs III amounting to US$ 3.6 Million (Rs. 2,336 Lakhs) and paid accrued interest of US$ 0.1 Million ( Rs.67 Lakhs) on the aforesaid bonds. On July 6, 2017, the deferred interest in respect of aforesaid bonds for the period July 6, 2012 to January 6, 2016 amounting to US$ 0.72 Million ( Rs. 467 Lakhs) has been paid. There are no outstanding FCCBs and related interest liabilities as at September 30, 2017. During the three months ended June 30, 2017, the subsidiary of the Company viz. Subex Americas Inc., has repaid the term loan of US$ 12 Million (Rs. 7,782 Lakhs) to the respective lenders on May 15, 2017. Exceptional items: ( Rs. in Lakhs) | |||||||
Particulars | Quarter ended | Year to date figures for the six months ended | Year ended | ||||
September 30, 2017 | June 30, 2017 | September 30, 2016 | September 30, 2017 | September 30, 2016 | March 31, 2017 | ||
Unaudited | Unaudited | Unaudited | Unaudited | Unaudited | Audited | ||
Loss on impairment of goodwill (note 7[i]&[ii]) | - | - | - | - | - | (10,890) | |
Total | - | - | - | - | - | (10,890) | |
7[i] As at March 31, 2017, the Company assessed the carrying value of goodwill relating to its investment in the subsidiary viz. Subex Americas Inc., amounting to Rs. 9,736 Lakhs. Based on future operational plan, projected cash flows and valuation carried out by an external valuer, the Company made an impairment provision of Rs. 6,010 Lakhs towards the carrying value of goodwill relating to its investment in the said subsidiary. The management was of the view that, the carrying value of the goodwill (net of provision) of Rs. 3,726 Lakhs as at March 31, 2017 was appropriate. There is no change in the management's assessment as regards the aforementioned carrying value of goodwill as at September 30, 2017. 7[ii] As at March 31, 2017, the Company assessed the carrying value of goodwill relating to its investment in the subsidiary viz. Subex (UK) Limited amounting to Rs. 67,036 Lakhs. Based on future operational plan, projected cash flows and valuation carried out by an external valuer, the Company made an impairment provision of Rs. 4,880 Lakhs towards the carrying value of goodwill relating to its investment in the said subsidiary. The management was of the view that, the carrying value of goodwill (net of provision) of Rs. 62,156 Lakhs as at March 31, 2017 was appropriate. There is no change in the management's assessment as regards the aforementioned carrying value of goodwill as at September 30, 2017. Other income for the quarters ended September 30, 2017, June 30, 2017 and September 30, 2016, includes write back of withholding taxes paid earlier in respect of interest on FCCBs, which is no longer payable on account of conversion of FCCBs into equity shares of the Company, amounting to Rs. Nil, Rs. 30 Lakhs and Rs. 250 Lakhs, respectively, that for the six months ended September 30, 2017 and September 30, 2016 amounting to Rs. 30 Lakhs and Rs. 455 Lakhs, respectively and that for the year ended March 31, 2017 amounting to Rs.1,037 Lakhs. Such, write back of withholding taxes has been adjusted with other withholding taxes liability of the Company. Employee benefits expenses for the quarters ended September 30, 2017, June 30, 2017 and September 30, 2016 are net of reversal of provision no longer required, in respect of employee incentives relating to sales and delivery commissions, amounting to Rs.156 Lakhs, Rs. 146 lakhs and Rs. Nil, respectively, that for the six months ended September 30, 2017 and September 30, 2016 amounting to Rs. 302 Lakhs and Rs. Nil, respectively and that for the year ended March 31, 2017 amounting to Rs.700 Lakhs. | |||||||
10 11 12 13 | The Board of Directors of the Company in its meeting held on August 21, 2017 approved the restructuring of the Company's business by way of transfer of its Revenue Maximization Solutions and related businesses ("RMS business") and the Subex Secure and Analytics solutions and related businesses ("Digital business") to its subsidiaries, Subex Assurance LLP and Subex Digital LLP (together referred to as "LLPs"), respectively, hereinafter referred to as the "Restructuring", subject to shareholders and other requisite approvals, to achieve amongst other aspects, segregation of the Company's business into separate verticals to facilitate greater focus on each business vertical, higher operational efficiencies, and to enhance the Company's ability to enter into business specific partnerships and attract strategic investors at respective business levels, with an overall objective of enhancing shareholder value. The shareholders of the Company approved the Restructuring by way of a special resolution passed through postal ballot on September 23, 2017 and subsequently, the Board of Directors of the Company in its meeting held on October 4, 2017 approved November 1, 2017 to be the effective date of the Restructuring, subject to the Company obtaining the requisite approvals in this regard. Accordingly, effective November 1, 2017, the Company's RMS business and the Digital business have been transferred on a going concern basis for a consideration of Rs.64,162 Lakhs and Rs. 1,600 Lakhs, respectively, in the form of Company's capital contribution in the aforesaid LLPs, subject to prescribed working capital adjustments. Post such Restructuring, the Company continues to directly hold 99.99% share in the capital of, and in the profits and losses of, each of these LLPs and the entire economic interest as well as control and ownership of the RMS Business and Digital Business remains with the Company post such Restructuring. The Group is engaged in the business of software products and related services. 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. Previous period figures have been regrouped/ reclassified, wherever necessary to confirm to current period's classification. Pursuant to Regulation 33 of the SEBI (Listing Obligation and Disclosure Requirements) Regulations, 2015, the Company has opted to publish the consolidated financial results. The standalone financial results, however, are being made available to the Stock Exchanges where the securities of the Company are listed and are also being posted on the Company's website www.subex.com. |
Bengaluru Surjeet Singh Date: November 10, 2017 Managing Director & CEO For further details on the results, please visit our website: www.subex.com | |