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DATATEC LIMITED - Updated trading statement

Release Date: 10/05/2018 08:00
Code(s): DTC     PDF:  
Wrap Text
Updated trading statement

Datatec Limited
(Incorporated in the Republic of South Africa)
(Registration number: 1994/005004/06)
ISIN: ZAE000017745
Share Code: DTC
(“Datatec” or “the Company” or “the Group”)

UPDATED TRADING STATEMENT

Datatec, the international Information and Communications Technology (ICT) company, is
publishing an updated trading statement for the year ended 28 February 2018 (“FY18”).

In terms of paragraph 3.4(b)(i) of the JSE Limited Listings Requirements, companies are required
to publish a trading statement as soon as they are satisfied that a reasonable degree of certainty
exists that the financial results for the period to be reported on next will differ by at least 20%
from the previous corresponding reporting period (“FY17”).

On 25 January 2018 Datatec announced that it had a reasonable degree of certainty (in terms of
paragraph 3.4(b)(iii) of the JSE Listings Requirements) that the financial results for FY18 would
differ by at least 20% from the previous corresponding period, but at that time did not have a
reasonable degree of certainty of the specific percentage or range difference in respect of its
three earnings per share metrics compared to FY17.

The preparation of the FY18 results has reached the stage where the Group has such a
reasonable degree of certainty and expects that for FY18:

•     Underlying* loss per share is expected to be 5.6 US cents, 16.6 US cents and more than
      100% lower than the 11.0 US cents underlying* earnings per share reported in FY17;

•     Headline loss per share is expected to be 19.1 US cents, 21.1 US cents and more than
      100% lower than the 2.0 US cents headline earnings per share reported in FY17;

•     Earnings per share is expected to be 20.5 US cents, 19.1 US cents and more than 100%
      higher than the 1.4 US cents reported in FY17.

The year over year decline in underlying* earnings per share and headline earnings per share is
primarily as a result of the sale of Westcon Americas to SYNNEX with effect from 1 September
2017, with the earnings from Westcon Americas therefore only being included in the FY18
earnings for a 6 month period (compared to 12 months in FY17) and the weaker financial
performance for Westcon International in FY18 compared to FY17 which contrasted with a much
stronger performance in Logicalis and Analysys Mason.

The year over year increase in earnings per share is as a result of the profit generated on the
sale of Westcon Americas to SYNNEX and the sale of Logicalis SMC.

Westcon goodwill previously carried by the Group ($247 million) was allocated to Westcon
Americas in full and derecognised as part of the profit on disposal. A portion of capitalised
development expenditure ($33 million) was similarly allocated to Westcon Americas and
derecognised as part of the profit on disposal. Most of the remaining capitalised development
expenditure ($55 million) was impaired at the year end. This will result in significantly lower
amortisation expense in future financial years.

The financial information on which this trading statement is based has not been reviewed nor
reported on by the Group’s external auditors.

The Company intends to release its full year results for FY18 on SENS on 17 May 2018.


* underlying earnings per share excludes impairments of goodwill and intangible assets, profit or
loss on sale of investments and assets, amortisation of acquired intangible assets, unrealised
foreign exchange movements, acquisition-related adjustments, fair value movements on
acquisition-related financial instruments, restructuring costs relating to fundamental
reorganisations and the taxation effect of all of the aforementioned.

Johannesburg
10 May 2018

Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 10/05/2018 08:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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