TIDMESG
RNS Number : 7083N
eServGlobal Limited
23 February 2009
?
Appendix 4D
eServGlobal Limited
ABN 59 052 947 743
Half-year report and appendix 4D
for the half-year ended 31 December 2008
The half-year financial report does not include notes of the type normally
included in an annual financial report and should be read in conjunction with
the 2008 annual financial report.
Half-year report and appendix 4D
for the half year ended
31 December 2008
Contents
Results for announcement to the market
1
Directors' Report
2
Auditor's Independence Declaration
4
Independent Review Report
5
Directors' Declaration
7
Consolidated Income Statement
8
Consolidated Balance Sheet
9
Consolidated Statement of Recognised Income and Expenses
10
Consolidated Cash Flow Statement
11
Notes to the Consolidated Financial Statements
12
Results for announcement to the market
+----------------------------------+-----+----------+-----+-----+-----+------+-----------+
| Results | A$ '000 |
| | |
+----------------------------------------+-----------------------------------------------+
| Revenues | Down | 9% | to | 83,093 |
| | | | | |
+----------------------------------------+----------+-----------------+------+-----------+
| Profit after tax attributable to | Down | 88% | to | 602 |
| members | | | | |
| | | | | |
+----------------------------------------+----------+-----------------+------+-----------+
| | | | | |
+----------------------------------------+----------+-----------------+------+-----------+
| | |
+----------------------------------------+-----------------------------------------------+
| Dividends (distributions) | Amount per | Franked amount per security |
| | security | |
+----------------------------------------+----------------+------------------------------+
| Current period | Nil c | 0% |
| Interim dividend declared | 3.0 c | 0% |
| Final dividend paid | | |
| | | |
+----------------------------------------+----------------+------------------------------+
| Previous corresponding period | Nil c | 0% |
| Interim dividend declared | 2.0 c | 0% |
| Final dividend paid | | |
| | | |
+----------------------------------------+----------------------+------------------------+
| | |
+----------------------------------+-----------------------------------------------------+
| Record date for determining | N/A |
| entitlements to the dividend. | |
+----------------------------------------+-----------------------------------------------+
| |
+----------------------------------+-----+----------+-----+-----+-----+------+-----------+
+------------------------------------------------------------------------------+
| Brief explanation of revenue, net profit and dividends (distributions). |
| The consolidated entity achieved sales revenue for the period of |
| $83.093 million (2007 $91.194 million) - a decrease of 9%. The gross profit |
| realised was $41.533 million (gross profit margin: 50%) |
| (2007 $47.622 million (gross profit margin: 52%)). EBITDA for the period was |
| $7.065 million (2007 EBITDA $13.192 million). |
| |
| The net result of the consolidated entity for the half year ended 31 |
| December 2008 was a profit after tax and minority interest for the period of |
| $0.602 million (2007 $5.194 million). Earnings per share was 0.4 cents (2007 |
| 3.1cents). |
| In accordance with the Group's accounting policies, development expenditure |
| incurred during the period of $2.5million was capitalised in the Balance |
| Sheet. The expenditure related to internally generated software comprising |
| the HomeSend platform for which no revenue is forecast in the FY09 year. |
| During the period, the operating cash flow for the period was a net outflow |
| of $4.026 million. This reflects the increased work in progress which is |
| still to be billed to customers. Also during the period a dividend of |
| $5.131 million was paid to shareholders. Cash at 31 December 2008 was |
| $10.163 million. It is anticipated that the cash balance will improve in the |
| second half. |
+------------------------------------------------------------------------------+
Directors' report
The directors of eServGlobal Limited submit herewith the financial report for
the half-year ended 31 December 2008. In order to comply with the provisions of
the Corporations Act 2001, the directors report as follows:
Directors
The names of the directors of the company during or since the end of the half
year are:
+-----------------------------------------------+-----------------------------------------------+
| Ian Buddery | Executive Chairman & Secretary |
+-----------------------------------------------+-----------------------------------------------+
| Laurent Lafarge | Chief Executive Officer & Director |
+-----------------------------------------------+-----------------------------------------------+
| François Barrault | Non Executive Director |
+-----------------------------------------------+-----------------------------------------------+
| Anthony Gilbert | Non Executive Director |
+-----------------------------------------------+-----------------------------------------------+
| Graham Libbesson | Non Executive Director |
+-----------------------------------------------+-----------------------------------------------+
| Jim Pratt | Non Executive Director |
+-----------------------------------------------+-----------------------------------------------+
| David Smart | Non Executive Director |
+-----------------------------------------------+-----------------------------------------------+
Review of Operations
This report is to be read in conjunction with other reports issued
contemporaneously.
eServGlobal Limited is a public company listed on the Australian Stock Exchange
(ASX:ESV) and the London Stock Exchange (AIM) (LSE:ESG). Along with its Head
Office in Sydney, Australia, the eServGlobal group has operations worldwide.
eServGlobal develops and implements convergent charging and rating, mobile
payment, network services and messaging products for over 80 operators in more
than 50 countries in mobile, fixed and IMS network environments.
Our comprehensive offering enables innovative subscriber services with real-time
control and improved financial performance. We help operators to grow new
revenues, reduce churn and lower their costs.
eServGlobal's Convergent Charging Suite responds to increasingly sophisticated
charging and billing challenges while providing advanced top up and mobile
payment solutions. Our Messaging Suite enables multimedia services such as
unified messaging, video blog, SMS and IM. We deliver WEB2.0, Mashup and Social
Network applications, meeting customer demand for new communication experiences.
With 16 offices around the world and staff from 30 different countries, we
provide flexible end-to-end solutions with ongoing product development and
worldwide implementation, integration and support services.
The consolidated entity achieved sales revenue for the period of $83.093 million
(2007 $91.194 million) - a decrease of 9%. The gross profit realised was $41.533
million (gross profit margin: 50%) (2007 $47.622 million (gross profit
margin: 52%)). EBITDA for the period was $7.065 million (2007 EBITDA $13.192
million).
The net result of the consolidated entity for the half year ended 31 December
2008 was a profit after tax and minority interest for the period of $0.602
million (2007 $5.194 million).
In accordance with the Group's accounting policies, development expenditure
incurred during the period of $2.5million was capitalised in the Balance Sheet.
The expenditure related to internally generated software comprising the HomeSend
platform for which no revenue is forecast in the FY09 year.
During the period, the operating cash flow for the period was a net outflow of
$4.026 million. This reflects the increased work in progress which is still to
be billed to customers. Also during the period a dividend of $5.131 million was
paid to shareholders. Cash at 31 December 2008 was $10.163 million. It is
anticipated that the cash balance will improve in the second half.
Auditor's independence declaration
The auditor's independence declaration is included on page 4 of the half-year
financial report.
Rounding off of amounts
The company is a company of the kind referred to in ASIC Class Order 98/0100,
dated 10 July 1998, and in accordance with that Class Order amounts in the
directors' report and the financial report are rounded off to the nearest
thousand dollars, unless otherwise indicated.
Signed in accordance with a resolution of the directors, made pursuant to
s.306(3) of the Corporations Act 2001.
On behalf of the directors
Ian Buddery
Executive Chairman
London, 23 February 2009
Deloitte Touche Tohmatsu
ABN 74 490 121 060
Grosvenor Place
225
George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1217
Australia
DX 10307SSE
Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2
9322 7001
www.deloitte.com.au
The Board of Directors
eServGlobal Limited
Level 3
6 O'Connell Street
Sydney NSW 2000
Dear Board Members
eServGlobal Limited
In accordance with section 307C of the Corporations Act 2001, I am pleased to
provide the following declaration of independence to the directors of
eServGlobal Limited.
As lead audit partner for the review of the financial statements of eServGlobal
Limited for the half-year ended 31 December 2008, I declare that to the best of
my knowledge and belief, there have been no contraventions of:
(i) the auditor independence requirements of the Corporations Act
2001 in relation to the review; and
(ii) any applicable code of professional conduct in relation to the
review.
Yours sincerely
DELOITTE TOUCHE TOHMATSU
Weng Ching
Partner
Chartered Accountants
Sydney, 23 February 2009
Liability limited by a scheme approved under Professional Standards Legislation.
Deloitte Touche Tohmatsu
A.B.N. 74 490 121 060
Grosvenor Place
225
George Street
Sydney NSW 2000
PO Box N250 Grosvenor Place
Sydney NSW 1220
Australia
DX 10307SSE
Tel: +61 (0) 2 9322 7000
Fax: +61 (0) 2
9322 7001
www.deloitte.com.au
Independent Auditor's Review Report
to the members of eServGlobal Limited
We have reviewed the accompanying half-year financial report of eServGlobal
Limited, which comprises the balance sheet as at 31 December 2008, and the
income statement, cash flow statement, statement of recognised income and
expense for the half-year ended on that date, selected explanatory notes and the
directors' declaration of the consolidated entity comprising the company and the
entities it controlled at the end of the half-year or from time to time during
the half-year as set out on pages 7 to 15.
Directors' Responsibility for the Half-Year Financial Report
The directors of the company are responsible for the preparation and fair
presentation of the half-year financial report in accordance with Australian
Accounting Standards (including the Australian Accounting Interpretations) and
the Corporations Act 2001. This responsibility includes establishing and
maintaining internal control relevant to the preparation and fair presentation
of the half-year financial report that is free from material misstatement,
whether due to fraud or error; selecting and applying appropriate accounting
policies; and making accounting estimates that are reasonable in the
circumstances.
Auditor's Responsibility
Our responsibility is to express a conclusion on the half-year financial report
based on our review. We conducted our review in accordance with Auditing
Standard on Review Engagements ASRE 2410 Review of an Interim Financial Report
Performed by the Independent Auditor of the Entity, in order to state whether,
on the basis of the procedures described, we have become aware of any matter
that makes us believe that the half-year financial report is not in accordance
with the Corporations Act 2001 including: giving a true and fair view of the
consolidated entity's financial position as at 31 December 2008 and its
performance for the half-year ended on that date; and complying with Accounting
Standard AASB 134 Interim Financial Reporting and the Corporations Regulations
2001. As the auditor of eServGlobal Limited, ASRE 2410 requires that we comply
with the ethical requirements relevant to the audit of the annual financial
report.
A review of a half-year financial report consists of making enquiries, primarily
of persons responsible for financial and accounting matters, and applying
analytical and other review procedures. A review is substantially less in scope
than an audit conducted in accordance with Australian Auditing Standards and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.
Liability limited by a scheme approved under Professional Standards Legislation.
Auditor's Independence Declaration
In conducting our review, we have complied with the independence requirements of
the Corporations Act 2001.
Conclusion
Based on our review, which is not an audit, we have not become aware of any
matter that makes us believe that the half-year financial report of eServGlobal
Limited is not in accordance with the Corporations Act 2001, including:
(a) giving a true and fair view of the consolidated entity's financial
position as at 31 December 2008 and of its
performance for the
half-year ended on that date; and
(b) complying with Accounting Standard AASB 134 Interim Financial Reporting
and the Corporations
Regulations 2001.
DELOITTE TOUCHE TOHMATSU
Weng Ching
Partner
Chartered Accountants
Sydney, 23 February 2009
Directors' declaration
The directors declare that:
(a) in the directors' opinion, there are reasonable grounds to believe the
company will be able to pay its debts as and when they become due and payable;
and
(b) in the directors' opinion, the attached financial statements and notes
thereto are in accordance with the Corporations Act 2001, including compliance
with accounting standards and giving a true and fair view of the financial
position and performance of the consolidated entity.
Signed in accordance with a resolution of the directors made pursuant to
s.303(5) of the Corporations Act 2001.
On behalf of the directors
Ian Buddery
Executive Chairman
London, 23 February 2009
Consolidated income statement
for the half-year ended 31 December 2008
+---------------------------------------------------------+------+--------------+---------------+
| Consolidated |
+----------------------------------------------------------------+
| | | Half-Year | Half-Year |
| | | Ended | Ended |
| | | 31 December | 31 December |
| | | 2008 | 2007 |
| | | $'000 | $'000 |
+---------------------------------------------------------+------+--------------+---------------+
| Revenue | | 83,093 | 91,194 |
+---------------------------------------------------------+------+--------------+---------------+
| Cost of sales | | (41,560) | (43,572) |
+---------------------------------------------------------+------+--------------+---------------+
| Gross profit | | 41,533 | 47,622 |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Other income | | 214 | 121 |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Research and development expenses | | (11,060) | (14,622) |
+---------------------------------------------------------+------+--------------+---------------+
| Sales and marketing expenses | | (11,849) | (8,176) |
+---------------------------------------------------------+------+--------------+---------------+
| Administration expenses | | (11,773) | (11,753) |
+---------------------------------------------------------+------+--------------+---------------+
| Earnings | | 7,065 | 13,192 |
| before | | | |
| interest, | | | |
| tax, | | | |
| depreciation | | | |
| and | | | |
| amortisation | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Amortisation expense | | (3,837) | (3,411) |
+---------------------------------------------------------+------+--------------+---------------+
| Depreciation expense | | (1,708) | (1,492) |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Earnings | | 1,520 | 8,289 |
| before | | | |
| interest | | | |
| and tax | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Finance costs | | (105) | (169) |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Profit before tax | | 1,415 | 8,120 |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Income tax expense | | (689) | (2,875) |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Profit for the period | | 726 | 5,245 |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Attributable to: | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Equity holders of the parent | | 602 | 5,194 |
+---------------------------------------------------------+------+--------------+---------------+
| Minority interest | | 124 | 51 |
+---------------------------------------------------------+------+--------------+---------------+
| | | | |
+---------------------------------------------------------+------+--------------+---------------+
| | | 726 | 5,245 |
+---------------------------------------------------------+------+--------------+---------------+
| Earnings per share: | | | |
+---------------------------------------------------------+------+--------------+---------------+
| Basic (cents per share) | | 0.4 | 3.1 |
+---------------------------------------------------------+------+--------------+---------------+
| Diluted (cents per share) | | 0.4 | 3.0 |
+---------------------------------------------------------+------+--------------+---------------+
Notes to the Financial Statements are included on pages 12 to 15 Consolidated
balance sheet
as at 31 December 2008
+-----------------------------------------+-------+---------------+---------------+
| Consolidated |
+-------------------------------------------------+
| | Note | 31 December | 30 June |
| | | 2008 | 2008 |
| | | $'000 | $'000 |
+-----------------------------------------+-------+---------------+---------------+
| Current Assets | | | |
+-----------------------------------------+-------+---------------+---------------+
| Cash and cash equivalents | | 10,163 | 18,288 |
+-----------------------------------------+-------+---------------+---------------+
| Trade and other receivables | 2 | 85,005 | 80,120 |
+-----------------------------------------+-------+---------------+---------------+
| Inventories | | 784 | 1,456 |
+-----------------------------------------+-------+---------------+---------------+
| Current tax assets | | 11,506 | 5,555 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Current Assets | | 107,458 | 105,419 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Non-Current Assets | | | |
+-----------------------------------------+-------+---------------+---------------+
| Trade and other receivables | | - | 5,077 |
+-----------------------------------------+-------+---------------+---------------+
| Property, plant and equipment | | 6,623 | 5,855 |
+-----------------------------------------+-------+---------------+---------------+
| Deferred tax assets | | 8,416 | 6,715 |
+-----------------------------------------+-------+---------------+---------------+
| Goodwill | | 51,851 | 46,804 |
+-----------------------------------------+-------+---------------+---------------+
| Other intangible assets | 3 | 26,223 | 22,544 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Non-Current Assets | | 93,113 | 86,995 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Assets | | 200,571 | 192,414 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Current Liabilities | | | |
+-----------------------------------------+-------+---------------+---------------+
| Trade and other payables | | 40,674 | 46,164 |
+-----------------------------------------+-------+---------------+---------------+
| Current tax payables | | 405 | 86 |
+-----------------------------------------+-------+---------------+---------------+
| Provisions | | 6,278 | 5,346 |
+-----------------------------------------+-------+---------------+---------------+
| Other | 4 | 5,336 | 7,432 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Current Liabilities | | 52,693 | 59,028 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Non-Current Liabilities | | | |
+-----------------------------------------+-------+---------------+---------------+
| Deferred tax liabilities | | 13,947 | 8,510 |
+-----------------------------------------+-------+---------------+---------------+
| Provisions | | 1,752 | 1,331 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Non-Current Liabilities | | 15,699 | 9,841 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Total Liabilities | | 68,392 | 68,869 |
+-----------------------------------------+-------+---------------+---------------+
| | | | |
+-----------------------------------------+-------+---------------+---------------+
| Net Assets | | 132,179 | 123,545 |
+-----------------------------------------+-------+---------------+---------------+
| |
+-------------------------------------------------+
| Equity | | | |
+-----------------------------------------+-------+---------------+---------------+
| Issued capital | 9 | 115,742 | 115,325 |
+-----------------------------------------+-------+---------------+---------------+
| Reserves | 10 | 14,252 | 1,638 |
+-----------------------------------------+-------+---------------+---------------+
| Retained earnings | | 2,007 | 6,536 |
+-----------------------------------------+-------+---------------+---------------+
| Parent entity interest | | 132,001 | 123,499 |
+-----------------------------------------+-------+---------------+---------------+
| Minority interest | | 178 | 46 |
+-----------------------------------------+-------+---------------+---------------+
| Total Equity | | 132,179 | 123,545 |
+-----------------------------------------+-------+---------------+---------------+
Notes to the Financial Statements are included on pages 12 to 15 Consolidated
statement of recognised income and expense
for the half-year ended 31 December 2008
+-----------------------------------------+-------+--+--------------+--------------+
| | | | Consolidated |
+-----------------------------------------+-------+--+-----------------------------+
| | | | Half-year | Half-year |
| | | | ended 31 | ended 31 |
| | | | December | December |
| | | | 2008 | 2007 |
| | | | $'000 | $'000 |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Exchange differences arising on the | | | 12,621 | 2,897 |
| translation of foreign operations | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Net income recognised directly in | | | 12,621 | 2,987 |
| equity | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Profit for the period | | | 726 | 5,245 |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Total recognised income and expense for | | | 13,347 | 8,142 |
| the period | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Attributable to: | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
| Equity holders of the parent | | | 13,223 | 8,091 |
+-----------------------------------------+-------+--+--------------+--------------+
| Minority interest | | | 124 | 51 |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | 13,347 | 8,142 |
+-----------------------------------------+-------+--+--------------+--------------+
| | | | | |
+-----------------------------------------+-------+--+--------------+--------------+
Notes to the Financial Statements are included on pages 12 to 15 Consolidated
cash flow statement
for the half-year ended 31 December 2008
+---------------------------------------------+----+---------------+---------------+
| Consolidated |
+--------------------------------------------------+
| | | Half-Year | Half-Year |
| | | Ended | Ended |
| | | 31 December | 31 December |
| | | 2008 | 2007 |
| | | $'000 | $'000 |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Cash Flows from Operating Activities | | | |
+---------------------------------------------+----+---------------+---------------+
| Receipts from customers | | 77,455 | 73,408 |
+---------------------------------------------+----+---------------+---------------+
| Payments to suppliers and employees | | (83,652) | (75,004) |
+---------------------------------------------+----+---------------+---------------+
| Interest and other costs of finance paid | | (105) | (169) |
+---------------------------------------------+----+---------------+---------------+
| Income tax refunded / (paid) | | 2,276 | (3,162) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Net cash used in operating activities | | (4,026) | (4,927) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Cash Flows From Investing Activities | | | |
+---------------------------------------------+----+---------------+---------------+
| Interest received | | 214 | 121 |
+---------------------------------------------+----+---------------+---------------+
| Payment for property, plant and equipment | | (1,561) | (2,312) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Net cash used in investing activities | | (1,347) | (2,191) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Cash Flows From Financing Activities | | | |
+---------------------------------------------+----+---------------+---------------+
| Proceeds from issues of equity securities | | 294 | 78 |
+---------------------------------------------+----+---------------+---------------+
| Dividends paid | | (5,131) | (3,408) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Net cash used in financing activities | | (4,837) | (3,330) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Net Decrease In Cash and Cash Equivalents | | (10,210) | (10,448) |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Cash At The Beginning Of The Period | | 18,288 | 12,528 |
+---------------------------------------------+----+---------------+---------------+
| Effects of exchange rate changes on the | | 2,085 | 533 |
| balance of cash held in foreign currencies | | | |
+---------------------------------------------+----+---------------+---------------+
| | | | |
+---------------------------------------------+----+---------------+---------------+
| Cash and Cash Equivalents At The End Of The | | 10,163 | 2,613 |
| Period | | | |
+---------------------------------------------+----+---------------+---------------+
Notes to the Financial Statements are included on pages 12 to 15
Notes to the consolidated financial statements
1. Significant accounting policies
Statement of compliance
The half-year financial report is a general purpose financial report prepared in
accordance with the Corporations Act 2001 and AASB 134 Interim Financial
Reporting. Compliance with AASB 134 ensures compliance with International
Financial Reporting Standard IAS 34 Interim Financial Reporting. The half-year
financial report does not include notes of the type normally included in an
annual financial report and should be read in conjunction with the most recent
annual financial report.
Basis of preparation
The condensed financial statements have been prepared on the basis of historical
cost, except for the revaluation of certain non-current assets and financial
instruments. Cost is based on the fair values of the consideration given in
exchange for assets. All amounts are presented in Australian dollars.
The company is a company of the kind referred to in ASIC Class Order 98/010,
dated 10 July 1998, and in accordance with that Class Order amounts in the
directors' report and the half-year financial report are rounded off the nearest
thousand dollars, unless otherwise indicated.
The accounting policies and methods of computation adopted in the preparation of
the half-year financial report are consistent with those adopted and disclosed
in the company's 2008 annual financial report for the financial year ended 30
June 2008.
2. Current trade and other receivables
+--------------------------------------------+------------------+----------------+
| Consolidated |
+---------------------------------------------------------------+
| |31 December 2008 | 30 June |
| | $'000 | 2008 |
| | | $'000 |
+--------------------------------------------+------------------+----------------+
| | | |
+--------------------------------------------+------------------+----------------+
| Trade receivables | 48,290 | 57,123 |
+--------------------------------------------+------------------+----------------+
| Work in progress | 27,254 | 14,911 |
+--------------------------------------------+------------------+----------------+
| Other receivables | 2,599 | 2,438 |
+--------------------------------------------+------------------+----------------+
| Deposits and prepayments | 6,862 | 5,648 |
+--------------------------------------------+------------------+----------------+
| | 85,005 | 80,120 |
+--------------------------------------------+------------------+----------------+
3. Other intangible assets
+--------------------------------+-----------------+----------------+--------------+
| | Software & | Customer | Total |
| | Documentation | Relationships | $'000 |
| | $'000 | $'000 | |
+--------------------------------+-----------------+----------------+--------------+
| Carrying value at 1 July 2008 | 8,502 | 14,042 | 22,544 |
+--------------------------------+-----------------+----------------+--------------+
| Internal development costs | 2,542 | - | 2,542 |
| capitalised | | | |
+--------------------------------+-----------------+----------------+--------------+
| Amortisation expense for the | (2,030) | (1,807) | (3,837) |
| period | | | |
+--------------------------------+-----------------+----------------+--------------+
| Effects of foreign exchange | 1,822 | 3,152 | 4,974 |
| movements | | | |
+--------------------------------+-----------------+----------------+--------------+
| Carrying value at 31 December | 10,836 | 15,387 | 26,223 |
| 2008 | | | |
+--------------------------------+-----------------+----------------+--------------+
+--------------------------------+-----------------+--------------+--------------+
| Carrying value at 1 July 2007 | 11,731 | 16,693 | 28,424 |
+--------------------------------+-----------------+--------------+--------------+
| Amortisation expense for the | (3,642) | (3,241) | (6,883) |
| year | | | |
+--------------------------------+-----------------+--------------+--------------+
| Effects of foreign exchange | 413 | 590 | 1,003 |
| movements | | | |
+--------------------------------+-----------------+--------------+--------------+
| Carrying value at 30 June 2008 | 8,502 | 14,042 | 22,544 |
+--------------------------------+-----------------+--------------+--------------+
4. Other Current Liabilities
+------------------------------------------+------------------+----------------+
| Consolidated |
+-------------------------------------------------------------+
| |31 December 2008 | 30 June |
| | $'000 | 2008 |
| | | $'000 |
+------------------------------------------+------------------+----------------+
| Deferred income | 5,336 | 7,432 |
+------------------------------------------+------------------+----------------+
5. Dividends
+--------------------------------+-----------+----------+-----------+------------+
| | Half Year ended 31 | Half Year ended 31 |
| | December 2008 | December 2007 |
| | | |
+--------------------------------+----------------------+------------------------+
| |Cents per | Total |Cents per | Total |
| | share | $'000 | share | $'000 |
+--------------------------------+-----------+----------+-----------+------------+
| Fully paid ordinary shares | | | | |
+--------------------------------+-----------+----------+-----------+------------+
| Recognised amounts | | | | |
+--------------------------------+-----------+----------+-----------+------------+
| Final dividend paid in respect | 3.0 | 5,131 | 2.0 | 3,408 |
| of prior financial year | | | | |
+--------------------------------+-----------+----------+-----------+------------+
| | | | | |
+--------------------------------+-----------+----------+-----------+------------+
6. Segment Information
Based on the risks and rewards associated with the company's business,
organisational structure and system of internal financial reporting to the Board
of Directors, management considers that the Group operates in one business
segment, the telecommunications software solutions business, and in the
following geographical segments.
Revenue in the table below has been calculated based on the geographical
location of the group company deriving the revenue:
+--------------+--------+--------+--------+--------+---------+---------+
| Segment Revenues |
+----------------------------------------------------------------------+
| | | | |
+--------------+-----------------+-----------------+-------------------+
| | | | | | | |
+--------------+--------+--------+--------+--------+---------+---------+
| | | | | | | |
+--------------+--------+--------+--------+--------+---------+---------+
| Asia | 8,245 | 3,717 | 2,022 | 3,459 | 10,267 | 7,176 |
| Pacific | | | | | | |
+--------------+--------+--------+--------+--------+---------+---------+
| Europe | 74,848 | 87,477 | 292 | - | 75,140 | 87,477 |
+--------------+--------+--------+--------+--------+---------+---------+
| | | | | | | |
+--------------+--------+--------+--------+--------+---------+---------+
| Total | | | | | 85,407 | 94,653 |
| of all | | | | | | |
| segments | | | | | | |
+--------------+--------+--------+--------+--------+---------+---------+
| Eliminations | | | | | (2,314) | (3,459) |
+--------------+--------+--------+--------+--------+---------+---------+
| Unallocated | | | | | 214 | 121 |
+--------------+--------+--------+--------+--------+---------+---------+
| Consolidated | | | | | 83,307 | 91,315 |
+--------------+--------+--------+--------+--------+---------+---------+
6. Segment Information (cont.)
The Group also captures revenue by the geographical segment, based on the
location of the ultimate customer:
+--------------+--------+--------+--------+--------+--------+--------+
| Segment Revenues |
+--------------------------------------------------------------------+
| | | | |
+--------------+-----------------+-----------------+-----------------+
| | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| Middle | 44,690 | 52,317 | - | - | 44,690 | 52,317 |
| East | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| Asia | 17,599 | 16,571 | - | - | 17,599 | 16,571 |
| Pacific | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| Europe | 12,026 | 18,436 | - | - | 12,026 | 18,436 |
+--------------+--------+--------+--------+--------+--------+--------+
| Africa | 4,388 | 3,073 | - | - | 4,388 | 3,073 |
+--------------+--------+--------+--------+--------+--------+--------+
| Central | 4,390 | 797 | - | - | 4,390 | 797 |
| and | | | | | | |
| South | | | | | | |
| America | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| Total | | | | | 83,093 | 91,194 |
| of all | | | | | | |
| segments | | | | | | |
+--------------+--------+--------+--------+--------+--------+--------+
| Unallocated | | | | | 214 | 121 |
+--------------+--------+--------+--------+--------+--------+--------+
| Consolidated | | | | | 83,307 | 91,315 |
+--------------+--------+--------+--------+--------+--------+--------+
7. Issuances, repurchases and repayment of securities
During the half-year eServGlobal Limited issued 1,026,000 ordinary shares for
$294 thousand on exercise of 1,026,000 share options issued under its executive
and employee share option plans. As a result of this share issue, $123 thousand
was transferred from the equity-settled employee benefits reserve of $1,035
thousand to issued capital. There were no other movements in the ordinary share
capital or other issued share capital of the company in the current half-year.
eServGlobal Limited issued no share options (6 months to 31 December 2007:
660,000) over ordinary shares under its executive and employee share option plan
during the half-year reporting period. The share options issued in the 6 months
to December 2007 had an average fair value at grant date of $0.44 per share
option.
8. Facilities
The company has a $5 million bill facility secured by a debenture charge over
the assets of the company in favour of the bank. This facility was undrawn at 31
December 2008.
9. Issued Capital
+-----------------------------------------+--+-------------------+------------------+
| Consolidated |
+--------------------------------------------+
| | | 31 December 2008 | 30 June 2008 |
| | | $'000 | $'000 |
+-----------------------------------------+--+-------------------+------------------+
| 172,035,598 fully paid ordinary shares | | 115,742 | 115,325 |
| (30 June 2008: 171,009,598) | | | |
+-----------------------------------------+--+-------------------+------------------+
| | | | |
+-----------------------------------------+--+-------------------+------------------+
+----------------------------------------+----------+----------+--+---------+---------+
| | 31 December 2008 | | 30 June 2008 |
+----------------------------------------+---------------------+--+-------------------+
| |No. '000 | $ '000 | | No. | $ '000 |
| | | | | '000 | |
+----------------------------------------+----------+----------+--+---------+---------+
| Fully Paid Ordinary Shares | | | | | |
+----------------------------------------+----------+----------+--+---------+---------+
| Balance at the beginning of the | 171,009 | 115,325 | | 170,076 | 115,005 |
| financial period | | | | | |
+----------------------------------------+----------+----------+--+---------+---------+
| Shares issued in the period | 1,026 | 294 | | 933 | 228 |
+----------------------------------------+----------+----------+--+---------+---------+
| Transfer from employee equity-benefit | - | 123 | | - | 92 |
| reserve | | | | | |
+----------------------------------------+----------+----------+--+---------+---------+
| Balance at the end of the financial | 172,035 | 115,742 | | 171,009 | 115,325 |
| period | | | | | |
+----------------------------------------+----------+----------+--+---------+---------+
| | | | | | |
+----------------------------------------+----------+----------+--+---------+---------+
+--------------------------------------------------------------------------------+
| In accordance with the executive and employee share option plan employees are |
| entitled to purchase shares in the company. The exercise of such share options |
| in the period resulted in the ordinary share capital increasing by 1,026,000 |
| (note 7). |
+--------------------------------------------------------------------------------+
10. Reserves
+-----------------------------------------+--+-------------------+------------------+
| Consolidated |
+--------------------------------------------+
| | | 31 December 2008 | 30 June 2008 |
| | | $'000 | $'000 |
+-----------------------------------------+--+-------------------+------------------+
| | | | |
+-----------------------------------------+--+-------------------+------------------+
| Employee equity-benefit | | 1,035 | 1,042 |
+-----------------------------------------+--+-------------------+------------------+
| Foreign currency translation | | 13,217 | 596 |
+-----------------------------------------+--+-------------------+------------------+
| | | 14,252 | 1,638 |
+-----------------------------------------+--+-------------------+------------------+
Other information required to be given to ASX under listing rule 4.2A.3
+-------------------------------+-------------------+-----------------+-----------------+
| Net tangible assets per | Current period | June 2008 | December 2007 |
| security | | | |
| | | | |
+-------------------------------+-------------------+-----------------+-----------------+
| Net tangible assets per | 31.4 cents | 31.7 cents | 26.8 cents |
| security | | | |
+-------------------------------+-------------------+-----------------+-----------------+
Dividends
+---------------------------+-----------+----------+------------+-----------+-----------+
| | Amount | Amount | Franked | Amount | Date |
| | | per | amount | per | paid/ |
| | | security | per | security | payable |
| | | | security | of | |
| | | | at 30% | foreign | |
| | | | tax | source | |
| | | | | dividend | |
+---------------------------+-----------+----------+------------+-----------+-----------+
| Interim dividend:Current | Nil | N/A | N/A | N/A | N/A |
| year | | | | | |
+---------------------------+-----------+----------+------------+-----------+-----------+
| Previous year | Nil | N/A | N/A | N/A | N/A |
+---------------------------+-----------+----------+------------+-----------+-----------+
| Final dividend paid in |5,131,068 | 3.0c | Unfranked | N/A | N/A |
| respect of previous |3,408,285 | 2.0c | Unfranked | N/A | N/A |
| financial year: | | | | | |
| Current period: | | | | | |
| Final dividend | | | | | |
| Previous corresponding | | | | | |
| period: | | | | | |
| Special dividend | | | | | |
| Final dividend | | | | | |
| | | | | | |
+---------------------------+-----------+----------+------------+-----------+-----------+
+--------------------------------------+-------+-----------------------------------+
| The dividend or distribution plans shown below are in operation. |
+----------------------------------------------------------------------------------+
| N/A. |
+----------------------------------------------------------------------------------+
| | |
+--------------------------------------+-------------------------------------------+
| The last date(s) for receipt of election | N/A |
| notices for the +dividend or distribution | |
| plans | |
+--------------------------------------+-------+-----------------------------------+
Details of associates and joint venture entities
+-------------------------+--------------+---------------+-----------+---------------+
| Name of entity | Percentage of ownership | Aggregate share of net |
| | interest held at end of | profit (loss) |
| | period | contributed to the |
| | | reporting entity |
+-------------------------+------------------------------+---------------------------+
| | Current | Previous | Current | Previous |
| | period | corresponding | period | corresponding |
| | | period | $A'000 | period |
| | | | | $A'000 |
+-------------------------+--------------+---------------+-----------+---------------+
| | | | | |
+-------------------------+--------------+---------------+-----------+---------------+
| Total | N/A | N/A | N/A | N/A |
+-------------------------+--------------+---------------+-----------+---------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR DXLBLKLBXBBF
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