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CAPITAL APPRECIATION LIMITED - Audited summarised consolidated financial results for the year ended 31 March 2022 and cash dividend declaration

Release Date: 02/06/2022 07:05
Code(s): CTA     PDF:  
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Audited summarised consolidated financial results for the year ended 31 March 2022 and
cash dividend declaration

Capital Appreciation Limited
Incorporated in the Republic of South Africa
Registration number: 2014/253277/06
JSE share code: CTA     ISIN: ZAE000208245
"the Company" or "the Group"

Audited summarised consolidated financial results for the year ended 31 March 2022 
and cash dividend declaration

Operational features
 - Strong demand for Group's products and services as corporate investment in digitalisation accelerates
 - Terminal sales up 51%, with Android terminals enjoying significant demand
 - Strong growth in the Software division, with revenue increasing by 34%
 - International division established in June 2021
 - Acquisition of the Responsive Group adding new capabilities and clients
 - International income grew by 33%
 - Compelling business pipeline across all businesses
 - Improved operating margins from scale benefits and operating efficiencies
 - Strong cash conversion continues to contribute to significant cash resources

Financial features
                                                                           March 2022        March 2021       % change

Revenue (R'million)                                                             831.0             619.5           34.1
Trading profit (R'million)                                                      273.2             186.9           46.2
EBITDA (R'million)                                                              251.6             172.9           45.5
EBITDA margin %                                                                  30.3              27.9         240bps
Operating profit (R'million)                                                    211.8             137.8           53.7
EPS (cents)                                                                     13.37             10.28           30.1
HEPS (cents)                                                                    13.40             10.34           29.6
Annual dividend (cents)                                                          7.50              5.50           36.4
Cash available for reinvestment (R'million)                                     533.4             538.3           (0.9)
Net asset value (cents)                                                         120.6             111.9            7.8

Current year performance
Capital Appreciation has experienced a strong acceleration in commercial activity and increasing interest in its turnkey
solutions over the year. The Group's financial results reflect the strong demand for its innovative technology products and
solutions. Capital Appreciation continued to attract a considerable number of high-profile local and international customers
in the banking, financial, retail, healthcare, telecommunications and logistics sectors. The Group generated strong topline revenue
growth and demonstrated good operating leverage, benefiting from the fulfilment of large terminal orders and pleasing growth
in terminal transaction income, as well as significant increases in cloud-based and digital consulting services and third-party
software and Hardware Security Module sales. The terminal estate grew to 277 000 terminals, reflecting a compounded annual
growth rate of 41% since 2017. Synthesis attracted more than R300 million of contracted sales, which were partially
fulfilled in the current year through new contract wins, significant software sales and the commencement of several long-term
projects. The Group's innovative tap-on-glass payment products, Halo Dot and Dashpay Glass, offer significant and exciting prospects.
There are multiple levels of collaboration already under way between Synthesis and the recently acquired Responsive Group and the
businesses foresee exciting joint opportunities for combined and complementary service offerings. Capital Appreciation remains highly
cash generative.

Digital transformation as well as an acceleration in demand for electronic payments, cloud services, and related
advances are creating numerous opportunities for the Group and continue to support positive growth prospects over the
medium term.

The Board has pleasure in announcing that a final dividend of 3.75 cents per ordinary share has been declared for the year ended 
31 March 2022 (2021: 3.00 cents per ordinary share), bringing the total dividend for the year to 7.50 cents per ordinary share 
(2021: 5.50 cents per ordinary share).

We note the following:

 - Dividends are subject to dividends withholding tax.
 - The payment date for the dividend is Monday, 27 June 2022.
 - Dividends have been declared out of profits available for distribution.
 - Local dividends withholding tax is 20%.
 - The gross dividend amount is 3.75 cents per ordinary share, which is 3.00 cents per ordinary share net of withholding tax.
 - Capital Appreciation has 1 310 000 000 ordinary shares in issue at the declaration date.
 - Capital Appreciation's Income Tax Reference Number is 9591281176.

The salient dates relating to the dividend are as follows:
Last day of trade cum dividend                                                       Tuesday, 21 June
Shares commence trading ex-dividend                                                Wednesday, 22 June
Dividend record date                                                                  Friday, 24 June
Dividend payment date                                                                 Monday, 27 June

Share certificates for ordinary shares may not be dematerialised or rematerialised between Wednesday, 22 June 2022 and 
Friday, 24 June 2022, both days inclusive.

Short-form notice
The contents of this short-form announcement are the responsibility of the Board of Directors of the Company.
Shareholders are advised that this short-form announcement represents a brief summary of the information contained in
the full announcement, published on 
and on Capital Appreciation's website The full announcement is available for inspection
at the registered office of the company during business hours and at no charge. Investors and/or shareholders may request 
copies of the full announcement by contacting the Company Secretary, details of whom are set out below.

Ernst & Young Inc., the Group's Independent auditors, have audited the consolidated financial statements of Capital Appreciation
Limited. The auditors have expressed an unmodified audit opinion on the consolidated financial statements. The audit report 
and key audit matter are available on the Company's website at

Any forecast financial information contained in this announcement is the responsibility of the directors and has not been reviewed 
or reported on by the external auditors. The directors of Capital Appreciation take full responsibility for the preparation of this
report and the financial information has been correctly extracted from the underlying group financial statements.

Any investment decisions by investors and/or shareholders should be based on a consideration of the full announcement as
a whole and shareholders are encouraged to review the full announcement as directed above.

Signed on behalf of the Board

Michael (Motty) Sacks                                    Michael Pimstein
Chairman                                                 Joint Chief Executive Officer

Alan Salomon                                             Bradley Sacks
Chief Financial Officer                                  Joint Chief Executive Officer

Sandton, 2 June 2022

Capital Appreciation Limited
"the Company" or "the Group", Incorporated in the Republic of South Africa
Registration number: 2014/253277/06 Registered office: 1st Floor 61 Katherine Street, Sandton, 2196
JSE share code: CTA     ISIN: ZAE000208245

MI Sacks# (Chairman), MR Pimstein* (Joint Chief Executive), BJ Sacks* (Joint Chief Executive),
AC Salomon* (Chief Financial Officer), MB Shapiro*, B Bulo#, KD Dlamini#, JM Kahn#, EM Kruger#, 
RT Maqache#, VM Sekese#, CL Valkin#

* Executive, #Non-executive

Company secretary 
PKF Octagon:

Transfer secretaries
Computershare Investor Services (Proprietary) Limited

Investec Bank Limited    

Ernst & Young Inc.

Date: 02-06-2022 07:05:00
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