TIDMIBPO
RNS Number : 0471F
iEnergizer Limited
12 November 2020
12 November 2020
iEnergizer Limited
("iEnergizer", the "Company" or the "Group")
INTERIM RESULTS FOR THE SIX MONTHSED 30 SEPTEMBER 2020
iEnergizer, the technology services and media solutions leader
for the digital age, reports another record set of interim results
for the six months ended September 30, 2020. Following the increase
in both earnings and interim dividend the Board looks forward to
the remainder of the year with confidence.
Financial Highlights: Enhanced profitability and margin
improvements despite temporary revenue impact of the COVID-19
pandemic.
-- EBITDA ([1]) up by $1.6m to $30.7m (H1 2020: $29.1m)
-- Increased EBITDA margin at 34.1% (H1 2020: 30.2%)
-- Group Revenue down 6.5% to $90.2m (H1 2020: $96.5m),
reflecting reduced business from clients impacted by government
lockdown measures
-- Operating profit increased to $27.9m (H1 2020: $26.8m)
-- Increased operating profit margin at 30.9% (H1 2020: 27.8%)
-- Profit before tax increased to $26.9m (H1 2020: $25.0m)
-- Higher profit before tax margin at 29.9% (H1 2020: 25.9%)
-- Profit after tax increased to $23.5m (H1 2020: $21.6m)
-- Net Cash of $5.6m (31 March 2020: $1.6m)
-- Proposing interim dividend of 5.72p per ordinary share ($14.36m) (H1 2020: 5.2p)
Operational Highlights : Continued focus on higher margin work
and success in business development with existing international
customers.
-- Business Process Outsource ("BPO"): Service Revenue reduced
by 7.6% to $54.9m in H1 2021 (H1 2020: $59.4m), due to reduced
business from some clients in India. EBITDA margin grew to 37.3% at
$20.8m (H1 2020: 33.5% at $20.3m), as COVID-19 positively impacted
iEnergizer's largest and higher margin generating international
verticals, offsetting the negative impact on smaller verticals
(low-margin India-based travel and e-commerce work). BPO's outsized
exposure to fast-growing markets of video gaming, BFSI, telecom and
healthcare is expected to result in revenue growth going forward
after the temporary decline in the first half of the year.
-- Content Division: Service Revenue reduced by 5.6% to $33.7m
in H1 2021 (H1 2020: $35.7m), as some key clients postponed high
value projects to H2 2021, due to COVID-19. EBITDA margins grew to
28.8% at $9.9m (H1 2020: 24.5% at $8.8m) due to cost-savings and
productivity enhancements from 90% of employees transitioning to
work from home.
o Increase in revenue share from higher margin E-Learning
contracts helped to reduce the larger negative revenue impact on
traditional publishing segments during global lockdowns in H1
2021.
o Focussed on increasing its revenue share from the SaaS product
line of "Scipris", investing in sales to promote this product
line.
o Continuing to identify further opportunities in Anti Money
Laundering /Know Your Customer services.
-- New business development: US based sales team is acutely
focussed on selling additional services, specifically in the online
learning market, which is expected to grow significantly due to new
opportunities presented by remote education and operating systems,
while working on its strategic priorities: to enhance and grow key
accounts; to identify and win new business through new customers;
as well as target our existing accounts; and to cross-sell and
generate leads for new product launches.
o Scalability, breadth of services and a highly trained
workforce allows iEnergizer to take advantage of industry tailwinds
in highly profitable verticals.
o The Company has continued to acquire new customers, in H1 2021
across iEnergizer's business lines of Business Process Outsource
and Content Services Division, with revenue expected to grow from
H2 2021 onwards for these new customers.
-- Cost management:
o Transition to agent work-from-home ("WFH") model has increased
efficiency, profitability, client loyalty, productivity, and
decreased costs.
o Increased proportion of division-specific higher margin
international work, particularly in non-voice-based processes
including: entertainment gaming support; BFSI; Content technology;
and E-Learning.
o Effective use of technology to handle greater volumes from key
customers.
-- COVID-19
o The Company has taken important steps to ensure that it is
well positioned to fully support the requirements of its customers
and staff. Business is operating efficiently in servicing its
customers, with most employees successfully transitioned to remote
working.
o As the lockdown measures are being eased, employees catering
to Indian customers are now returning to the Company's offices,
following government and local authority best-practice
guidelines.
o This provides the Directors with confidence that the Group's
operational efficiency will increase to normal levels as the
Government of India continue to reduce the lockdown measures.
o The Company's balance sheet, net cash position and its
long-term customer relationships remain strong.
-- Interim Dividend:
o In line with the progressive dividend policy, the Company is
pleased to announce an interim dividend of 5.72p with the dividend
record date of 27 November, 2020. This interim dividend reflects
the Board's confidence in the Group's business plan and growth
prospects.
o The Company's Ordinary Shares are expected to go ex-dividend
on 26 November, 2020 and the interim dividend is expected to be
paid on 18 December, 2020.
Marc Vassanelli, Chairman of iEnergizer, commented:
"Despite challenges in some business areas due to the impact of
COVID-19 on our customers, iEnergizer has demonstrated high
resilience during this period. The continued growth in profit
margins has been driven by our colleagues' continued efforts in
deepening existing customer relationships and via iEnergizer's
compelling and evolving proposition, combined with careful and
focused cost management. Reflecting the Group's strong balance
sheet and the cash generative nature of the business, we are
pleased to announce an interim dividend of 5.72p, continuing the
trend started in H1 2020.
"During this unprecedented time of COVID-19, we remain in close
discussions with our customers to ensure that we meet their needs
and requirements, while supporting our staff to work safely and
remotely as per government guidelines, to serve customers at
maximum capacity and efficiency on all our services.
"With iEnergizer's solid foundation, proven strength in
operational execution, new sales initiatives, differentiated
offerings, healthy balance sheet, and with substantial
opportunities for further growth identified, w e expect sustained
business performance and the Board looks forward to the remainder
of the year with confidence."
-Ends-
EBITDA has been calculated under the IFRS 16 accounting
standards, under which a company's operating lease liabilities are
shown as liabilities on the balance sheet, together with the
related assets that correspond to the right to use such assets over
the remaining life of the related lease contracts. If these impacts
had not been taken into consideration, the EBITDA would have been
$29.8m.
iEnergizer Ltd. +44 (0)1481 242233
Chris de Putron
Mark De La Rue
+44 (0)20 3727
FTI Consulting - Communications Adviser 1000
Jonathon Brill / Eleanor Purdon
Arden Partners - Nominated adviser and Broker
Ciaran Walsh / Benjamin Cryer/ Steve Douglas
/ Dan Gee-Summons (Corporate Finance) +44 (0)20 7614
James Reed-Daunter (Equity Sales) 5900
iEnergizer Limited and its subsidiaries
Unaudited Condensed Consolidated Interim Financial
Statements
Prepared in accordance with International Financial Reporting
Standards (IFRS)
Six months ended 30 September 2020 and 2019
Unaudited Condensed Consolidated Statements of Financial
Position
(All amounts in United States Dollars, unless otherwise
stated)
Notes As at As at
30 September 31 March 2020
2020
Unaudited Audited
-------------------------------- ------ ---------------------------- ----------------------
ASSETS
Non-current
Goodwill 5 102,249,839 102,248,030
Other intangible assets 6 12,745,302 12,557,319
Right to use 10 4,912,802 5,303,271
Property, plant and equipment 7 6,189,439 7,142,700
Long- term financial asset 2,511,424 3,351,981
Non-current tax assets 248,946 1,238,883
Deferred tax asset 3,866,593 3,623,361
Other non current assets 2,915 21,047
Non-current assets 132,727,260 135,486,592
---------------------------- ----------------------
Current
Trade and other receivables 30,608,165 32,044,127
Cash and cash equivalents 44,208,431 45,147,783
Short- term financial assets 8 14,594,266 7,642,641
Current tax assets - 211,055
Other current assets 4,042,739 2,589,023
Current assets 93,453,601 87,634,629
---------------------------- ----------------------
Total assets 226,180,861 223,121,221
============================ ======================
EQUITY AND LIABILITIES
Equity
Share capital 3,776,175 3,776,175
Share compensation reserve 63,986 63,986
Additional paid in capital 15,451,809 15,451,809
Merger reserve (1,049,386) (1,049,386)
Retained earnings 142,839,866 139,677,678
Other components of equity (16,591,327) (17,320,281)
Total equity attributable to equity
holders of the parent 144,491,123 140,599,981
---------------------------- ----------------------
Notes As at As at
30 September 31 March 2020
2020
Unaudited Audited
------ ------------- --------------
Liabilities
Non-current
Long term borrowings 28,561,619 32,992,983
Employee benefit obligations 4,667,389 4,667,061
Deferred tax liability 10,664,867 9,717,709
Non-current liabilities 43,893,875 47,377,753
-------------------------- ------------------------
Current
Trade and other payables 14,616,199 11,481,885
Employee benefit obligations 828,923 810,614
Current tax liabilities 300,107 -
Current portion of long term
borrowings 10,049,427 10,527,775
Other current liabilities 12,001,207 12,323,213
Current liabilities 37,795,863 35,143,487
-------------------------- ------------------------
Total equity and liabilities 226,180,861 223,121,221
========================== ========================
(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)
(The accompanying notes are an integral part of these Unaudited
Condensed Consolidated Interim Financial Statements)
Notes For the six For the six
months months ended
ended
30 September 30 September
2020 2019
Unaudited Unaudited
---------------------------------- ------ ------------- --------------
Income from operations
Revenue from services 88,675,643 95,180,896
Other operating income 1,070,303 1,046,950
89,745,946 96,227,846
------------- --------------
Cost and expenses
Outsourced service cost 17,960,207 21,219,347
Employee benefits expense 34,138,255 39,580,811
Depreciation and amortisation 2,343,227 2,063,317
Other expenses 7,391,648 6,566,098
61,833,337 69,429,573
------------- --------------
Operating profit 27,912,609 26,798,273
Finance income 590,691 360,107
Finance cost (1,603,155) (2,199,643)
Profit before tax 26,900,145 24,958,737
------------- --------------
Income tax expense 3,363,846 3,387,120
Profit for the year attributable
to equity holders of the parent 23,536,299 21,571,617
============= ==============
Earnings per share 9
Basic 0.12 0.11
Diluted 0.12 0.11
Par value of each share in
GBP 0.01 0.01
Unaudited Condensed Consolidated Statements of Other
Comprehensive Income
(All amounts in United States Dollars, unless otherwise
stated)
For the six months For the six months
ended ended
30 September 2020 30 September
2019
Unaudited Unaudited
------------------------------------------- ------------------------------- -----------------------------
Profit after tax for the year 23,536,299 21,571,617
Other comprehensive income
Items that will be reclassified subsequently to
the
consolidated income statement
Exchange differences on translating
foreign operations 728,954 (808,836)
Net other comprehensive (loss) that
will be reclassified subsequently
to consolidated income statement 728,954 (808,836)
------------------------------- -----------------------------
Items that will not be reclassified subsequently
to income statement
Remeasurement of the net defined
benefit liability - 257,399
Income tax relating to items that
will not be reclassified - (74,954)
Net other comprehensive income that
will be not be reclassified subsequently
to consolidated income statement - 182,445
------------------------------- -----------------------------
Other comprehensive income/(loss)
for the year 728,954 (626,391)
Total comprehensive income attributable
to equity holders 24,265,253 20,945,226
------------------------------- -----------------------------
(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 Additional Share Merger Other components Retained Total
capital paid-in-capital compensation reserve of equity earnings equity
reserve
---------------------------
Foreign Net defined
currency benefit
translation liability
reserve
--------------- ---------- ----------------- -------------- ------------ ------------- ------------ ------------- ---------------
Balance as at
1
April 2019 3,776,175 15,451,809 63,986 (1,049,386) (12,448,144) 778,332 131,950,337 138,523,109
--------------- ---------- ----------------- -------------- ------------ ------------- ------------ ------------- ---------------
Dividends - - - - - - (37,294,827) (37,294,827)
--------------- ---------- ----------------- -------------- ------------ ------------- ------------ ------------- ---------------
Transaction
with
owners - - - - - - (37,294,827) (37,294,827)
Profit for the
year - - - - - - 45,022,168 45,022,168
Other
comprehensive
loss - - - - (5,559,767) (90,702) - (5,650,469)
---------------
Total
comprehensive
income for
the period - - - - (5,559,767) (90,702) 45,022,168 39,371,699
--------------- ---------- ----------------- -------------- ------------ ------------- ------------ ------------- ---------------
Balance as at
31
March 2020 3,776,175 15,451,809 63,986 (1,049,386) (18,007,911) 687,630 139,677,678 140,599,981
--------------- ---------- ----------------- -------------- ------------ ------------- ------------ ------------- ---------------
(The accompanying notes are an integral part of the Consolidated
Financial Statements)
Share Additional Share compensation Merger Other components Retained Total
capital Paid in reserve reserve of equity earnings equity
Capital
----------------------------------
Foreign Net defined
currency benefit
translation liability
reserve
--------------- ------------- --------------------- ------------------------------- --------------- ---------------- -------------------------------------------------
Balance as at
01 April
2020 3,776,175 15,451,809 63,986 (1,049,386) (18,007,911) 687,630 139,677,678 140,599,981
--------------- ------------- --------------------- ------------------------------- --------------- ---------------- ---------------- -------------- ---------------
Dividends - - - - - - (20,374,113) (20,374,113)
--------------- ------------- --------------------- ------------------------------- --------------- ---------------- ---------------- -------------- ---------------
Transaction
with owners - - - - - - (20,374,113) (20,374,113)
Profit for the
year - - - - - - 23,536,300 23,536,300
Other
comprehensive
gain - - - - 728,954 - - 728,954
---------------
Total
comprehensive
income for
the period - - - - 728,954 - 23,536,300 24,265,254
--------------- ------------- --------------------- ------------------------------- --------------- ---------------- ---------------- -------------- ---------------
Balance as at
30 September
2020 3,776,175 15,451,809 63,986 (1,049,386) (17,278,957) 687,630 142,839,866 144,491,123
--------------- ------------- --------------------- ------------------------------- --------------- ---------------- ---------------- -------------- ---------------
(The accompanying notes are an integral part of these Unaudited
Condensed Consolidated Interim Financial Statements)
Unaudited Condensed Consolidated Statements of Cash Flows
(All amounts in United States Dollars, unless otherwise
stated)
For the six For the six
months months ended
ended
30 September 30 September
2020 2019
(A) Cash flow from operating activities
Profit before tax 26,900,145 24,958,737
Adjustments
Depreciation and amortisation 2,343,227 2,063,317
Loss/(Profit) on disposal of property,
plant and equipment (2,064) (6,024)
Trade receivables written-off/provision
for doubtful debts 1,089,700 (65,262)
Sundry balances written back (2,750) -
Unrealised foreign exchange gain (651,277) (174,089)
Finance income (590,691) (360,107)
Finance cost 1,603,155 2,199,643
---------------------------- -------------------------------
30,689,445 28,616,215
Changes in operating assets and liabilities
(Increase)/ Decrease in trade and other
receivables (484,556) 2,015,601
(Increase)/ Decrease in other assets
(current and non-current) 2,081,433 941,298
Increase / (Decrease) Non-current liabilities,
trade payables & other current liabilities (1,304,119) 2,670,121
(Decrease)/ Increase in employee benefit
obligations (9,053) 307,761
---------------------------- -------------------------------
Cash generated from operations 30,973,150 34,550,996
Income taxes paid (1,158,820) (2,383,750)
---------------------------- -------------------------------
Net cash generated from operating activities 29,814,330 32,167,246
---------------------------- -------------------------------
(B) Cash flow for investing activities
Payments for purchase of property plant
and equipment (256,175) (1,521,588)
Investment in fixed deposit (Net) (3,256,262) (883,210)
Proceeds from disposal of property,
plant & equipment 2,258 6,581
Payments for purchase of other intangible
assets (505,703) (220,909)
Interest received 585,282 400,808
Net cash used in investing activities (3,430,600) (2,218,318)
---------------------------- -------------------------------
For the six For the six months
months ended ended
30 September 30 September
2020 2019
(C ) Cash flow from financing activities
Interest paid (1,603,155) (2,145,802)
Repayment of borowings and lease liability (5,179,793) (4,150,357)
Net cash used in financing activities (6,782,948) (6,296,159)
--------------------------- ------------------------------
Net increase/(decrease) in cash and
cash equivalents 19,600,782 23,652,769
Dividends paid to equity holders of
the parent (20,374,113) (24,068,320)
Cash and cash equivalents at the beginning
of the year 45,147,783 42,404,281
Effect of exchange rate changes on cash (166,022) 83,553
Cash and cash equivalents at the end
of the year 44,208,431 42,072,283
--------------------------- ------------------------------
Cash and cash equivalents comprise
Cash in hand 13,801 8,337
Balances with banks in current account 44,194,630 42,063,946
44,208,431 42,072,283
--------------------------- ------------------------------
(The accompanying notes are an integral part of these
Consolidated 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.
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.
iEnergizer through its subsidiaries iEnergizer Holdings Limited,
iEnergizer IT Services Private Limited, iEnergizer Management
Services Limited, iEnergizer BPO Limited, iEnergizer BPO Inc,
iEnergizer Aptara Limited and Aptara Inc and subsidiaries.
(together the 'Group') is engaged in the business of call centre
operations, providing business process outsource (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 2020 and 2019.
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 annual financial statements for the years
ended 31 March 2020 and 2019.
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 11 November 2020.
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. SIGNIFICANT ACCOUNTING POLICIES
The interim financial statements have been prepared in
accordance with the accounting policies adopted in the Group's most
recent annual financial statements for the years ended 31 March
2020 and 2019.
4. SIGNIFICANT MANAGEMENT JUDGEMENT IN APPLYING ACCOUNTING POLICIES AND ESTIMATION UNCERTAINTY
When preparing the Unaudited Condensed Consolidated Interim
Financial Statements, management undertakes a number of judgements,
estimates and assumptions about recognition and measurement of
assets, liabilities, income and expenses. The actual results may
differ from the judgements, estimates and assumptions made by
management, and will seldom equal the estimated results.
The judgements, estimates and assumptions applied in the
Unaudited Condensed Consolidated Interim Financial Statements,
including the key sources of estimation uncertainty were the same
as those applied in the Group's last audited financial statements
for the year ended 31 March 2020.
5. GOODWILL
The net carrying amount of goodwill can be analysed as
follows:
Particulars Amount
----------------------------- -----------------
Balance as at 1 April 2019 102,256,665
Impairment loss recognized -
Translation adjustment (8,635)
Balance as at 31 March 2020 102,248,030
----------------------------- -----------------
Particulars Amount
--------------------------------- ------------
Balance as at 01 April 2020 102,248,030
Translation adjustment 1,809
Balance as at 30 September 2020 102,249,839
--------------------------------- ------------
6. OTHER INTANGIBLE ASSETS
The Intangible assets comprise of computer software, customer
contracts.
Particulars Customer Computer Patent Trademark Intangibles Total
contracts software under
development
------------------------- ------------------- --------------- --------------- ---------------- -------------- -----------
Cost
Balance as at 1 April
2019 24,112,814 3,944,019 100,000 12,000,000 132,490 40,289,323
------------------- --------------- --------------- ---------------- -------------- -----------
Additions - 511,654 - - - 511,654
Disposals - - - - - -
Translation and other
adjustments (9,657) (276,192) - - - (285,849)
Balance as at 31 March
2020 24,103,157 4,179,481 100,000 12,000,000 132,490 40,515,128
------------------- --------------- --------------- ---------------- -------------- -----------
Accumulated amortisation
Balance as at 1 April
2019 24,112,814 3,559,966 - - 132,490 27,805,270
------------------- --------------- --------------- ---------------- -------------- -----------
Amortisation/impairment
for
the period - 423,580 - - - 423,580
Disposals - - - - - -
Translation and other
adjustments (9,657) (261,384) - - - (271,041)
Balance as at 31 March
2020 24,103,157 3,722,162 - - 132,490 27,957,809
------------------- --------------- --------------- ---------------- -------------- -----------
Carrying values as at 31
March 2020 - 457,319 100,000 12,000,000 - 12,557,319
------------------------- ------------------- --------------- --------------- ---------------- -------------- -----------
Particulars Customer contracts* Computer Patent Trade mark Intangibles Total
softwares under
development
------------------------- ---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
Cost
Balance as at 01 April
2020 24,103,157 4,179,481 100,000 12,000,000 132,490 40,515,128
---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
Additions - 505,703 - - - 505,703
Disposals - - - - - -
Translation and other
adjustments 2,024 64,686 - - - 66,710
Balance as at 30
September 2020 24,105,181 4,749,870 100,000 12,000,000 132,490 41,087,541
---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
Accumulated amortisation
Balance as at 01 April
2020 24,103,157 3,722,162 - - 132,490 27,957,809
---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
Amortisation/impairment
for
the period - 319,700 - - - 319,700
Disposals - - - - - -
Translation and other
adjustments 2,024 62,706 - - - 64,730
Balance as at 30
September 2020 24,105,181 4,104,568 - - 132,490 28,342,239
---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
Carrying values as at 30
September
2020 - 645,302 100,000 12,000,000 - 12,745,302
------------------------- ---------------------- ------------------ ------------------ ------------------- ----------------- ------------------
7. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment comprise of the following:
Particulars Computer Office Furniture Air Vehicle Leasehold Plant Capital Total
and data equipment and conditioner improve-ments and work in
equipment fixtures and machinery progress
generator
-------------- ----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Cost
Balance as at
1 April
2019 8,406,553 854,772 1,438,730 916,719 20,747 4,717,127 2,316,570 224,308 18,895,526
----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Additions 2,467,719 274,357 39,541 34,233 398,792 152,713 120,773 114,088 3,602,216
Disposals (85,706) - (16,167) - - - (15,686) - (117,559)
Translation
and other
adjustments (684,194) (66,510) (95,586) (67,004) (23,407) (334,231) (147,647) (7,175) (1,425,754)
Balance as at
31 March
2020 10,104,372 1,062,619 1,366,518 883,948 396,132 4,535,609 2,274,010 331,221 20,954,429
----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Balance as at
1 April
2019 5,522,457 778,064 996,024 262,105 16,561 2,846,284 1,866,959 - 12,288,454
----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Depreciation
for the
period 1,628,060 62,006 117,881 114,565 29,858 461,149 187,790 - 2,601,309
Disposals (85,037) - (16,083) - - - (15,261) - (116,381)
Translation
and other
adjustments (466,409) (52,044) (69,242) (24,599) (2,745) (220,207) (126,407) - (961,653)
Balance as at
31 March
2020 6,599,071 788,026 1,028,580 352,071 43,674 3,087,226 1,913,081 - 13,811,729
----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Carrying
values as
at 31 March
2020 3,505,301 274,593 337,938 531,877 352,458 1,448,383 360,929 331,221 7,142,700
-------------- ----------- ---------- ---------- ------------ --------- -------------- ---------- --------- ------------------
Particulars Computer Office Furniture Air conditioner Vehicle Leasehold Plant and Capital Total
and data Equipment and fixtures and generator improvements machinery work in
equipment progress
-------------- ------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
Cost
Balance as at
01 April
2020 10,104,372 1,062,619 1,366,518 883,948 396,132 4,535,609 2,274,011 331,221 20,954,430
------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
Additions 355,308 27,857 15,019 45,619 - 21,528 43,940 (253,097) 256,174
Disposals
(Net) (58,497) - - - - - - - (58,497)
Translation
and other
adjustments 158,534 15,872 20,117 13,761 6,333 71,299 32,611 5,478 324,005
Balance as at
30 September
2020 10,559,717 1,106,348 1,401,654 943,328 402,465 4,628,436 2,350,562 83,602 21,476,112
------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
Accumulated
depreciation
Balance as at
01 April
2020 6,599,071 788,028 1,028,580 352,070 43,674 3,087,225 1,913,082 - 13,811,730
------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
Depreciation
for the
period 859,562 33,731 53,728 53,916 1,596 232,032 65,810 - 1,300,375
Disposals
(Net) (58,303) - - - - - - - (58,303)
Translation
and other
adjustments 117,019 11,715 15,593 6,534 730 52,860 28,421 - 232,872
Balance as at
30 September
2020 7,517,349 833,474 1,097,901 412,520 46,000 3,372,117 2,007,313 - 15,286,674
------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
Carrying
values as
at 30
September
2020 3,042,368 272,874 303,753 530,808 356,465 1,256,319 343,249 83,602 6,189,438
-------------- ------------------- ------------------ ------------------ ------------------- -------- ------------------ ------------------------ ---------------- -----------
8. SHORT TERM FINANCIAL ASSETS
Particulars 30 September 31 March 2020
2020
---------------------------------------- ------------------- ----------------
Security deposits 61,483 60,516
Restricted cash 5,815,886 4,293,982
Short term investments (fixed deposits
with maturity less than 12 months) 8,648,935 3,244,643
Derivative financial instruments 23,942 -
Due from officers and employees 22,354 27,244
Others 21,666 16,256
---------------------------------------- ------------------- ----------------
14,594,266 7,642,641
---------------------------------------- ------------------- ----------------
Short term investments comprise of investment through banks in
deposits denominated in various currency units bearing fixed rate
of interest.
9. 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 2020 is as follows:
Basic earnings per share
Particulars 30 September 30 September
2020 2019
---------------------------------------------- --------------------------- ----------------------------
Profit attributable to shareholders 23,536,299 21,571,617
Weighted average numbers shares outstanding 190,130,008 190,130,008
Basic earnings per share (US$) 0.12 0.11
---------------------------------------------- --------------------------- ----------------------------
Diluted earnings per share
Particulars 30 September 30 September
2020 2019
---------------------------------------------- -------------------------- -------------------
Profit attributable
to shareholders 23,536,299 21,571,617
Weighted average numbers shares outstanding 190,130,008 190,130,008
Diluted earnings per
share (US$) 0.12 0.09
---------------------------------------------- -------------------------- -------------------
10. LEASES
(a) Lease liabilities are presented in the statement of
financial position as follows:
Particulars 30 September 31 March 2020
2020
------------- ------------- -------------------
Current 1,108,453 1,216,547
Non-current 4,293,899 4,467,004
------------- ------------- -------------------
5,402,352 5,683,551
------------- ------------- -------------------
(b) The following are amounts recognised in consolidated income
statement:
Particulars 30 September 31 March 2020
2020
------------------------------------------ ------------- --------------
Depre ciation expenses of right-of-use
Interest Expense on the Lease Liability 723,152 1,451,931
Interest expense on lease liability 266,387 587,564
Rent expenses* 29,448 9,323
Common area maintenance expenses 60,887 175,566
------------------------------------------ ------------- --------------
Total 1,079,874 2,224,384
------------------------------------------ ------------- --------------
*Rent expense in respect of Short Term Lease
(c) Right to use of assets as at 31 March 2020:
Particulars Leased premises
--------------------------------- ----------------
Gross block
Balance as at 31 March 2019 -
IFRS-16 transition 6,311,071
--------------------------------- ----------------
Gross block as at 1 April 2019 6,311,071
Additions during the year 580,409
Translation adjustment (194,989)
--------------------------------- ----------------
Gross block as at 31 March 2020 6,696,491
--------------------------------- ----------------
Accumulated depreciation
Balance as at 1 April 2019 -
Depreciation for the period 1,451,931
Translation adjustment (58,711)
--------------------------------- ----------------
Accumulated depreciation as at
31 March 2020 1,393,220
--------------------------------- ----------------
Net block as at 31 March 2020 5,303,271
--------------------------------- ----------------
Particulars Leased premises
------------------------------------- ----------------
Gross block as at 1 April 2020 6,696,491
Additions during the year 270,081
Translation adjustment 90,297
------------------------------------- ----------------
Gross block as at 30 September 2020 7,056,869
------------------------------------- ----------------
Accumulated depreciation
Balance as at 1 April 2020 1,393,220
Depreciation for the period 723,152
Translation adjustment 27,695
------------------------------------- ----------------
Accumulated depreciation as at
30 September 2020 2,144,067
------------------------------------- ----------------
Net block as at 30 September 2020 4,912,802
------------------------------------- ----------------
The lease liabilities were USD 5,402,352 as of 30 September 2020
(USD 5,683,551 as of 31 March 2020). The corresponding interest
expense for the six month ended 30 September 2020 amounted to USD
266,387 (interest expense for the year ended 31 March 2020 amounted
to USD 587,564).
(e) The maturity analysis of the lease liabilities as of 31 March 2020, is as follows:
Payments falling due Gross future minimum lease
payments
----------------------------------------- -----------------------------
30 September 31 March 2020
2020
----------------------------------------- ------------- --------------
Within 1 year 1,699,280 1,616,248
Later than 1 year but less than 5 years 3,929,693 3,341,682
More than 5 years 1,744,994 2,436,638
----------------------------------------- ------------- --------------
7,373,967 7,394,568
----------------------------------------- ------------- --------------
11. 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 Mr. Anil Aggarwal
party
II. Entities directly
or indirectly through EICR (Cyprus) Limited (Parent of
one or more intermediaries, iEnergizer Limited)
control, are controlled
by, or are under common
control with, the reported
enterprises
III. Key management personnel Mr. Anil Aggarwal (Ultimate Shareholder,
("KMP") and significant EICR Limited)
shareholders
Mr. Chris de Putron (Director, iEnergizer
Limited)
Mr. Mark De La Rue (Director, iEnergizer
Limited)
Mr. Marc Vassanelli (Director, iEnergizer
Limited)
Mr. Ashish Madan (Director, iEnergizer
Limited)
Disclosure of transactions between the Group and related parties
and the outstanding balances is as under:
Transactions with KMP and relative of KMP
Particulars 30 September 30 September
2020 2019
-------------------------------- ------------- -------------
Transactions during the period
ended
Short term employee benefits
Remuneration paid to directors
Chris de Putron 6,300 6,249
Mark De La Rue 6,300 6,249
Marc Vassanelli 18,899 18,747
Balances at the end of
Total remuneration payable 147,741 109,385
-------------------------------- ------------- -------------
12. SEGMENT REPORTING
Management currently identifies the Group's two service lines
business process outsource and content delivery as operating
segments on the basis of operations. These operating segments are
monitored and operating and strategic decisions are made on the
basis of operating segment 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. Business Process Outsource
2. Content delivery
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 . Segment information can be analysed as
follows for the reporting periods under review:
30 September 2020
-----------------------------------------------
Business Process Content delivery Total
Outsource
---------------------------------- ---------------------- ----------------------- ----------------------
Revenue from external customers 54,935,441 33,740,202 88,675,643
Other income (including realised
foreign exchange gain) 934,741 135,563 1,070,304
Realized Foreign Exchange
gain/(loss) (23,942) 497,113 473,171
---------------------------------- ---------------------- ----------------------- ----------------------
Segment revenue 55,846,240 34,372,878 90,219,118
---------------------------------- ---------------------- ----------------------- ----------------------
Cost of outsourced Services 13,537,655 4,422,552 17,960,207
Employee benefit expense 15,971,568 18,166,687 34,138,255
Other expenses 5,513,055 1,878,593 7,391,648
---------------------------------- ---------------------- ----------------------- ----------------------
Earning before interest, tax,
depreciation and amortization 20,823,961 9,905,046 30,729,007
---------------------------------- ---------------------- ----------------------- ----------------------
Rent adjustment as per IFRS
16 321,533 568,176 889,709
---------------------- ----------------------- ----------------------
Earning before interest, tax,
depreciation and amortisation
(before rent adjustment) 20,502,428 9,336,870 29,839,298
---------------------------------- ---------------------- ----------------------- ----------------------
Unrealized Foreign Exchange
gain/(loss) 23,942 (497,113) (473,171)
Depreciation and amortisation (1,186,847) (1,156,380) (2,343,227)
Rent adjustment as per IFRS
16 321,533 568,176 889,709
---------------------------------- ---------------------- ----------------------- ----------------------
Segment operating profit 19,661,056 8,251,553 27,912,609
Other Income/expense :
Finance income 433,615 157,076 590,691
Finance costs (258,483) (1,344,672) (1,603,155)
Profit before tax 19,836,189 7,063,957 26,900,146
---------------------------------- ---------------------- ----------------------- ----------------------
Income tax expense (2,145,367) (1,218,479) (3,363,846)
Profit after tax 17,690,822 5,845,478 23,536,300
---------------------------------- ---------------------- ----------------------- ----------------------
Segment assets 72,950,460 153,230,400 226,180,860
Segment liabilities 22,136,831 59,441,566 81,578,397
Capital expenditure 692,921 339,037 1,031,958
---------------------------------- ---------------------- ----------------------- ----------------------
30 September 2019
---------------------------------------------
Business Process Content delivery Total
Outsource
---------------------------------- ---------------------- ----------------------- --------------------
Revenue from external customers 59,433,379 35,747,517 95,180,896
Other income (including realised
foreign exchange gain) 1,028,226 280,168 1,308,394
Realized Foreign Exchange - - -
gain/(loss)
---------------------------------- ---------------------- ----------------------- --------------------
Segment revenue 60,461,605 36,027,685 96,489,290
---------------------------------- ---------------------- ----------------------- --------------------
Cost of outsourced Services 16,144,667 5,074,680 21,219,347
Employee benefit expense 20,188,248 19,392,563 39,580,811
Other expenses 3,839,943 2,726,155 6,566,098
---------------------------------- ---------------------- ----------------------- --------------------
Earning before interest, tax,
depreciation and amortisation 20,288,747 8,834,287 29,123,034
---------------------------------- ---------------------- ----------------------- --------------------
Rent adjustment as per IFRS
16 (281,860) (602,398) (884,258)
---------------------- ----------------------- --------------------
Earning before interest, tax,
depreciation and amortisation
(before rent adjustment) 20,006,887 8,231,889 28,238,776
---------------------------------- ---------------------- ----------------------- --------------------
Unrealized Foreign Exchange
gain/(loss) - (261,444) (261,444)
Depreciation and amortisation (959,531) (1,103,786) (2,063,317)
Rent adjustment as per IFRS
16 281,860 602,398 884,258
---------------------------------- ---------------------- ----------------------- --------------------
Segment operating profit 19,329,216 7,469,057 26,798,273
Other Income/expense :
Finance income 246,139 113,968 360,107
Finance costs (256,274) (1,943,369) (2,199,643)
Profit before tax 19,319,081 5,639,656 24,958,737
---------------------------------- ---------------------- ----------------------- --------------------
Income tax expense (1,954,446) (1,432,675) (3,387,121)
Profit after tax 17,364,635 4,206,981 21,571,616
---------------------------------- ---------------------- ----------------------- --------------------
Segment assets 65,500,283 156,564,586 222,064,869
Segment liabilities 38,248,855 48,416,000 86,664,855
Capital expenditure 4,682,531 3,625,169 8,307,700
---------------------------------- ---------------------- ----------------------- --------------------
Revenue from the following customer's amounts to more than 10%
of consolidated revenue during the period presented.
30 September 2020
Revenue from Segment Amount
-------------- ---------------------------- -----------
Customer 1 Business Process Outsource 12,959,751
-------------- ---------------------------- -----------
30 September 2019
Revenue from Segment Amount
-------------- ---------------------------- -----------------------------
Customer 1 Business Process Outsource 9,928,185
-------------- ---------------------------- -----------------------------
13. 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 31 March 2020
2020
----------------------------------------- ------------- --------------
Non-current assets
Loans and receivables
Security deposits 408,735 382,614
Restricted cash 1,424,263 1,881,726
Fixed deposit 678,426 1,087,641
Current assets
Loans and receivables
Trade receivables 30,608,165 32,044,127
Cash and cash equivalents 44,198,534 45,147,783
Restricted cash 5,815,886 4,293,982
Security deposits 61,483 60,516
Fixed deposits with banks 8,648,934 3,244,643
Due from officers and employees 22,354 27,244
Interest accrued on fixed deposit 21,666 16,256
Fair value through profit and loss:
Derivative financial instruments - -
91,888,446 88,186,532
----------------------------------------- ------------- --------------
Financial liabilities 30 September 31 March 2020
2020
----------------------------------------- ------------- --------------
Non-current liabilities
Financial liabilities measured at
amortized cost:
Long term borrowings 28,561,619 32,992,983
Current liabilities
Financial liabilities measured at
amortized cost:
Short term borrowings
Trade payables 14,616,172 11,481,885
Current portion of long term borrowings 10,049,427 10,527,775
Other current liabilities 12,001,206 12,323,213
Fair value through profit and loss:
Derivative financial instruments - -
65,228,424 67,325,856
----------------------------------------- ------------- --------------
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.
14. 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:
Fair value measurements
at reporting date
using
------------------------------- ------------- ------------------------
30 September 2020 Total Level 2
------------------------------- ------------- ------------------------
(Notional
Liabilities amount)
Derivative instruments
Forward contracts (currency -
US$/INR) 19, 100 ,000 (89,733)
------------------------------- ------------- ------------------------
Fair value measurements
at reporting date
using
------------------------------- ----------- ------------------------
31 March 2020 Total Level 2
------------------------------- ----------- ------------------------
(Notional
Assets amount)
Derivative instruments
Forward contracts (currency -
US$/INR) 35,850,000 (1,891,422)
------------------------------- ----------- ------------------------
15. COMMITMENT AND CONTINGENCIES
As at 30 September 2020 and 31 March 2020, the Group had a
capital commitment of US$ 318,845 and US$141,848 respectively for
acquisition of property, plant and equipment.
The contingent liability in respect of claims filed by erstwhile
employees against the group companies amounts to US$62,876 and
US$55,427 as on 30 September 2020 and 31 March 2020 respectively
and in respect of interest on VAT amounts to US$9,496 as on 30
September 2020 (US$9,347 as on 31 March 2020).
Guarantees: As at 30 September 2020 and 31 March 2020,
guarantees provided by banks on behalf of the group companies to
the revenue authorities and certain other agencies, amount to
approximately US$37,320 and US$36,732 respectively.
16. 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
years ended 31 March 2020 and 2019.
17. 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 years ended 31 March 2020 and
2019.
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END
IR FLFEDLSLLLII
(END) Dow Jones Newswires
November 12, 2020 02:00 ET (07:00 GMT)
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