REG - iEnergizer Limited - CORRECTION: INTERIM RESULTS
20/11/2019 09:35
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RNS Number : 0484U
iEnergizer Limited
20 November 2019
20 November 2019
CORRECTION: INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019
The following amendments have been made to the 'Interim Results' announcement
released on 13 November at 07:00am (UK Time) under RNS No 1712T.
· The original RNS stated the Dividend record date as 21(st) November
2019. This is corrected to a Dividend record date of 22(nd) November 2019.
· The original RNS stated that the Company's Ordinary Shares were
expected to go ex-dividend on 22(nd) November 2019. This is corrected to
21(st) November 2019.
All other details remain unchanged.
iEnergizer Limited
("iEnergizer", the "Company" or the "Group")
INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2019
iEnergizer, the technology services and media solutions leader for the digital
age, reports interim results for the six months ended September 30, 2019.
Financial Highlights: Sustained profitable revenue growth and margin
improvements, achieved through deepening existing customer relationships and
securing new customer contracts, with ongoing careful cost management
· Group Revenue up 13.1% to $96.2m (H1 2019: $85.1m)
· Service Revenue up 15.6% to $95.2m (H1 2019: $82.4m)
· EBITDA( 1 ) of $29.1m (H1 2019: $24.3m)
· Higher EBITDA margin at 30.2% (H1 2019: 29.1%)
· Operating profit increased to $26.8m (H1 2019: $23.4m)
· Higher operating profit margin at 27.8% (H1 2019: 27.5%)
· Profit before tax increased to $25.0m (H1 2019: $21.0m)
· Higher profit before tax margin at 25.9% (H1 2019: 24.6%)
· Profit after tax increased to $21.6m (H1 2019: $17.3m)
· Net debt( 2 ) of $0.43m (31 March 2019: $3.9m)
· Proposing interim dividend of 5.2p per ordinary share ($12.7m) (H1
2019: nil p)
Operational Highlights: Continued focus on higher margin work and success in
business development with existing and new customers.
· Services: Double-digit revenue growth to $95.2m (H1 2019: $82.4m)
through: the addition of several new clients; and increased billable work
volumes and new contract wins from existing clients, including higher margin
activity.
· Business Process Outsource ("BPO"): Strong revenue growth of 23.6% to
$59.4m in H1 2020 (H1 2019: $48.1m) and EBITDA margins 20.3% higher at $20.8m
(H1 2019: $17.3m), as key customers continued to increase workload volumes.
The focus remains on recurring revenue streams from long-term customer
relationships across all verticals.
· Content Division: Revenue growth of 4.3% to $35.7m in H1 2020 (H1
2019: $34.3m) and increased EBITDA margins by 18.4% to $8.8m (H1 2019: $7.5m),
achieved despite structural pressures in the traditional publishing market.
o New E-Learning projects, related to design and development of class room
training material for virtualization projects, supported revenue growth in
Content Division.
o Continued development of new course material and Learning Management
Systems (LMS) for the Off-The-Shelf (OTS) content service.
o Growing customer base, amongst existing and new customers, for the
Scientific Publishing and Remittance Integration Services ("SciPris") product
line.
o Growing customer pipeline for new services, such as Anti Money Laundering
KYC service.
· New business development:
o US based sales team continued to focus on three 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 additional services.
o Acquisition of multiple new customers in H1 2020 across iEnergizer's
business lines of Business Process Outsource and Content Services Division,
with revenue expected to contribute from H2 2020.
· Cost management:
o Continued focus on cost saving initiatives.
o Increased proportion of division-specific higher margin work, particularly
in non-voice based processes including content writing, financials,
entertainment gaming support, content technology and digital solutions.
o Effective use of technology to handle greater volumes from key customers
without notable additional human resource.
· Interim Dividend:
o In line with the progressive dividend policy, the Company is pleased to
announce an interim dividend of 5.2p with the Dividend record date of 22nd
November 2019. 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 21st
November 2019 and the interim dividend is expected to be paid on 20th December
2019.
Marc Vassanelli, Chairman of iEnergizer, commented:
"This has been another successful period for iEnergizer across each division,
despite structural challenges in some business areas. The continuation of
profitable growth has been driven by our colleagues' continued efforts, in
deepening existing customer relationships and attracting new customers via
iEnergizer's compelling and evolving proposition, coupled with careful cost
management. As a result, we are pleased to announce an interim dividend of
5.2p, for the first time.
"We benefit from a solid foundation, and with continued strong operational
execution, the development of new sales initiatives and differentiated
offerings, underpinned by a healthy balance sheet and substantial growth
opportunities, we expect sustained business performance through the second
half of the year. The Board looks forward to the remainder of the year with
confidence."
1 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 $28.24m.
2 Net Debt has been calculated after excluding IFRS 16 impact of
capitalization of leases as "Right of Use Assets" and their consequent lease
liability creation. If these impacts had been included, Net Debt would have
been $6.72m
-Ends-
iEnergizer Ltd. +44 (0)1481 242233
Chris de Putron
Mark De La Rue
FTI Consulting - Communications Adviser +44 (0)20 3727 1000
Jonathon Brill / Eleanor Purdon
Arden Partners - Nominated adviser and Broker +44 (0)20 7614 5900
Ciaran Walsh / Steve Douglas / Dan Gee-Summons (Corporate Finance)
James Reed-Daunter (Equity Sales)
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 2019 and 2018
Unaudited Condensed Consolidated Statements of Financial Position
(All amounts in United States Dollars, unless otherwise stated)
Notes As at As at
30 September 2019 31 March 2019
Unaudited Audited
ASSETS
Non-current
Goodwill 5 102,254,951 102,256,665
Other intangible assets 6 18,422,167 12,484,053
Property, plant and equipment 7 6,787,035 6,607,072
Long- term financial asset 639,442 1,681,981
Non-current tax assets 807,223 1,095,365
Deferred tax asset 4,776,269 4,726,068
Other non current assets 9,987 33,098
Non-current assets 133,697,074 128,884,302
Current
Trade and other receivables 34,623,099 36,675,342
Cash and cash equivalents 42,072,283 42,413,215
Short- term financial assets 8 7,903,185 7,058,455
Current tax assets 404,143 505,345
Other current assets 3,365,085 3,320,502
Current assets 88,367,795 89,972,859
Total assets 222,064,869 218,857,161
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 129,453,634 131,950,337
Other components of equity (12,296,204) (11,669,812)
Total equity attributable to equity holders of the parent 135,400,014 138,523,109
Notes As at As at
30 September 2019 31 March 2019
Unaudited Audited
Liabilities
Non-current
Long term borrowings 38,743,275 870,535
Employee benefit obligations 4,046,496 4,101,097
Other non-current liabilities - 216,669
Deferred tax liability 9,313,757 8,574,576
Non-current liabilities 52,103,528 13,762,877
Current
Short term borrowings - 8,934
Trade and other payables 13,497,589 10,574,896
Employee benefit obligations 1,000,647 858,384
Current portion of long term borrowings 10,045,091 45,403,496
Other current liabilities 10,018,000 9,725,465
Current liabilities 34,561,327 66,571,175
Total equity and liabilities 222,064,869 218,857,161
(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 year For the six months ended
ended
30 September 2019 30 September 2018
Unaudited Unaudited
Income from operations
Revenue from services 95,180,896 82,361,309
Other operating income 1,046,950 2,724,771
96,227,846 85,086,080
Cost and expenses
Outsourced service cost 21,219,347 17,959,356
Employee benefits expense 39,580,811 35,284,407
Depreciation and amortization 2,063,317 2,680,368
Other expenses 6,566,098 5,735,424
69,429,573 61,659,555
Operating profit 26,798,273 23,426,525
Finance income 360,107 288,208
Finance cost (2,199,643) (2,760,603)
Profit before tax 24,958,737 20,954,130
Income tax expense 3,387,120 3,696,473
Profit for the year attributable to equity holders of the parent 21,571,617 17,257,657
Earnings per share 9
Basic 0.11 0.09
Diluted 0.11 0.09
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 ended For the six months ended
30 September 2019 30 September 2018
Unaudited Unaudited
Profit after tax for the year 21,571,617 17,257,657
Other comprehensive income
Items that will be reclassified subsequently to the consolidated income
statement
Exchange differences on translating foreign operations (808,836) (5,458,225)
Net other comprehensive (loss) that will be reclassified subsequently to (808,836) (5,458,225)
consolidated income statement
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 182,445 -
to consolidated income statement
Other comprehensive income/(loss) for the year (626,391) (5,458,225)
Total comprehensive income attributable to equity holders 20,945,226 11,799,432
(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 capital Additional Paid in Capital Share compensation reserve Merger reserve Other components of equity Retained earnings Total equity
Foreign currency translation reserve Net defined
benefit
liability
Balance as at 01 April 2018 3,776,175 15,451,809 63,986 (1,049,386) (9,219,409) 706,857 100,201,260 109,931,292
Profit for the year - - - - - - 31,749,077 31,749,077
Other comprehensive loss - - - - (3,228,735) 71,475 - (3,157,260)
Total comprehensive income for the year - - - - (3,228,735) 71,475 31,749,077 28,591,817
Balance as at 31 March 2019 3,776,175 15,451,809 63,986 (1,049,386) (12,448,144) 778,332 131,950,337 138,523,109
(The accompanying notes are an integral part of the Consolidated Financial
Statements)
iEnergizer Limited
Share capital Additional Paid in Capital Share compensation reserve Merger reserve Other components of equity Retained earnings Total equity
Foreign currency translation reserve Net defined
benefit
liability
Balance as at 01 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 - - - - - - (24,068,320) (24,068,320)
Transaction with owners (24,068,320) (24,068,320)
Profit for the year - - - - - - 21,571,617 21,571,617
Other comprehensive loss - - - - (808,836) 182,444 - (626,392)
Total comprehensive income for the period - - - - (808,836) 182,444 21,571,617 20,945,225
Balance as at 30 September 2019 3,776,175 15,451,809 63,986 (1,049,386) (13,256,980) 960,776 129,453,634 135,400,014
(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 months ended For the six months ended
30 September 2019 30 September 2018
(A) Cash flow from operating activities
Profit before tax 24,958,737 20,954,130
Adjustments
Depreciation and amortisation 2,063,317 2,680,368
Loss/(Profit) on disposal of property, plant and equipment (6,024) (9,312)
Trade receivables written-off/provision for doubtful debts (65,262) (411)
Unrealised and Realised foreign exchange gain (174,089) (2,398,514)
Finance income (360,107) (288,208)
Finance cost 2,199,643 2,760,603
28,616,215 23,698,656
Changes in operating assets and liabilities
(Increase)/ Decrease in trade and other receivables 2,015,601 (4,050,098)
(Increase)/ Decrease in other assets (current and non-current) 941,298 (305,985)
Increase / (Decrease) Non-current liabilities, trade payables & other 2,670,121 (3,685,214)
current liabilities
(Decrease)/ Increase in employee benefit obligations 307,761 (657,949)
Cash generated from operations 34,550,996 14,999,410
Income taxes paid (2,383,750) (2,704,661)
Net cash generated from operating activities 32,167,246 12,294,749
(B) Cash flow for investing activities
Payments for purchase of property plant and equipment (1,521,588) (2,005,663)
Investment in fixed deposit (Net) (883,210) 40,211
Proceeds from disposal of property, plant & equipment 6,581 9,312
Payments for purchase of other intangible assets (220,909) (196,939)
Interest received 400,808 263,654
Net cash used in investing activities (2,218,318) (1,889,425)
For the six months ended For the six months ended
30 September 2019 30 September 2018
(C ) Cash flow from financing activities
Interest paid (2,145,802) (2,371,072)
Repayment of long-term borrowings (4,150,357) (8,274,611)
Net cash used in financing activities (6,296,159) (10,645,683)
Net increase/(decrease) in cash and cash equivalents 23,652,769 (240,359)
Dividends paid to equity holders of the parent (24,068,320) -
Cash and cash equivalents at the beginning of the year 42,404,281 33,371,550
Effect of exchange rate changes on cash 83,553 292,269
Cash and cash equivalents at the end of the year 42,072,283 33,423,460
Cash and cash equivalents comprise
Cash in hand 8,337 12,681
Balances with banks in current account 42,063,946 33,410,779
Bank overdraft - -
42,072,283 33,423,460
(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 2019 and 2018. 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 2019 and 2018.
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 12 November 2019.
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 2019 and 2018.
IFRS 16 - Lease Accounting
IFRS 16 will replace the existing leases Standard, IAS 17 Leases, and related
interpretations. The standard sets out the principles for the recognition,
measurement, presentation and disclosure of leases. IFRS 16 introduces a
single lease accounting model and requires a lessee to recognize assets and
liabilities for all leases with a term of more than 12 months, unless the
underlying asset is of low value. The effective date for adoption of IFRS 16
is annual periods beginning on or after 1 April 2019
The Group has applied IFRS 16 using the modified retrospective second
approach, by measuring the asset at an amount equal to the lease liability,
adjusted by the amount of any prepaid or accrued lease payments recognized
immediately before the date of initial application.
The Group has applied the following practical expedients:-
a) On Transition to IFRS 16 the weighted average incremental borrowing
rate applied to lease liabilities recognized under IFRS 16 was 8.40%.
b) On Transition for Leases previously accounted for as operating leases
with a remaining lease term of less than 12 months and for leases of low-
value assets the Group has applied the optional exemptions to not recognize
right of use assets but to account for the lease expense on a straight-line
method over the remaining lease term.
The changes in accounting policies are also expected to be reflected in the
Group's consolidated financial statements as at and for the year ending 31
March 2020. The Group has initially adopted IFRS 16 Leases from 1 April 2019.
The Group has applied IFRS 16 using the modified retrospective approach and
therefore comparative information is still reported under IAS -17.
The following is a reconciliation of total operating lease commitments at 31
March 2019 to the lease liabilities recognised at 1 April 2019:
Reconciliation at 31st March 2019 Amount in USD
Particulars
Gross Lease Liabilities at 31 March 2019 7,308,682
Less - Lease with remaining lease term of less than 12 months
-
Less - Discounted using incremental borrowing rate (956,476)
Add - Other Finance Lease liabilities -
Present value of Lease Liabilities at 31 March 2019 6,352,206
Policy for new leases started from or after 1 April 2019
For any new contracts entered into on or after 1 April 2019, the Group
considers whether a contract is, or contains a lease. A lease is defined as a
contract or part of contract that conveys the right to use an asset for a
period of time in exchange for consideration'. To apply this definition the
Group assesses whether it meets three key evaluation points:
o The contract contained identified asset.
o Group has the right to obtain substantially all the economic benefit from
the use of identified asset throughout the period of use.
o The Group has right to direct the use of the identified asset throughout
the period of use.
Measurement and Recognition of leases as a lessee
At the commencement date, the Group recognizes a right of use asset and a
lease liability on the balance sheet date. The right of use asset is measured
at cost, which is made up of initial measurement of a lease liability and any
initial direct cost incurred by the Group.
The Group depreciates the right of use assets on a straight line basis from
the lease commencement date to the earlier of the end of the useful life of
the right of use asset or the end of lease term. The Group also assesses the
right of use asset for impairment when such indicator exists.
At the commencement date, the Group measures the lease liability at the
present value of the lease payments unpaid at that date, discounted using the
interest rate implicit in the lease if that rate is readily available or the
Group's incremental borrowing rate
The Group has elected to account for short-term leases and leases of low-value
assets using the practical expedients. Instead of recognising a right-of-use
asset and lease liability, the payments in relation to these are recognised as
an expense in profit or loss on a straight-line basis over the lease term.
Policy for the comparative period (which has not been restated) has been
repeated as follows:-
Determination of whether an arrangement is, or contains, a lease is based on
the substance of the arrangement at inception date whether fulfilment of the
arrangement is dependent on the use of a specific asset or assets and the
arrangement conveys a right to use the asset.
Group as a lessee
Finance leases, which transfer to the Group substantially all the risks and
benefits incidental to ownership of the leased item, are capitalized at the
commencement of the lease at the fair value of the leased property or, if
lower, at the present value of the minimum lease payments. Lease payments are
apportioned between finance charges and reduction of the lease liability so as
to achieve a constant rate of interest on the remaining balance of the
liability. Finance charges are recognized in the consolidated income
statement.
Leased assets are depreciated over the useful life of the asset. However, if
there is no reasonable certainty that the Group will obtain ownership by the
end of the lease term, the asset is depreciated over the shorter of the
estimated useful life of the asset and the lease term.
Operating lease payments are recognized as an expense in the consolidated
income statement on a straight line basis over the lease term. Rent abatements
and escalations are considered in the calculation of minimum lease payments in
the Group's capital lease testing and in determining straight line rent
expense for operating leases.
Consolidated Lease Position as at 30th Sep 2019
Particulars Amount in USD
Fixed Asset- Lease Hold Improvement 1 April 2019 6,352,206
Fixed Asset- Lease Hold Improvement addition during six months 258,645
Accumulated Depreciation till 30 September 2019 (619,123)
Net Block as on 30 September 2019 5,991,728
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 2019.
5. GOODWILL
The net carrying amount of goodwill can be analysed as follows:
Particulars Amount
Balance as at 01 April 2018 102,265,086
Impairment loss recognized -
Translation adjustment (8,421)
Balance as at 31 March 2019 102,256,665
Particulars Amount
Balance as at 01 April 2019 102,256,665
Translation adjustment (1,714)
Balance as at 30 September 2019 102,254,951
6. OTHER INTANGIBLE ASSETS
The Intangible assets comprise of computer software, customer contracts.
Particulars Customer contracts* Computer software Patent Trademark Intangibles under development Total
Cost
Balance as at 01 April 2018 24,122,232 3,589,438 100,000 12,000,000 132,490 39,944,160
Additions - 576,081 576,081
Disposals - - - - - -
Translation adjustment (9,418) (221,500) - - - (230,918)
Balance as at 31 March 2019 24,112,814 3,944,019 100,000 12,000,000 132,490 40,289,323
Accumulated amortisation
Balance as at 01 April 2018 21,806,084 3,235,118 - - 132,490 25,173,692
Amortisation/ impairment for the period 2,316,148 523,642 - - - 2,839,790
Disposals - - - - - -
Translation adjustment (9,418) (198,794) - - - (208,212)
Balance as at 31 March 2019 24,112,814 3,559,966 - - 132,490 27,805,270
Carrying values as at 31 March 2019 - 384,053 100,000 12,000,000 - 12,484,053
*Customer contracts are intangible assets created for long standing customer
relationships in the content delivery segment. Once the relationship is
established the work continues to flow on a year to year basis. The carrying
amount of such contracts is Nil.
Particulars Customer contracts* Computer software Patent Trademark Intangibles under development Right of Use Asset** Total
Cost
Balance as at 01 April 2019 24,112,814 3,944,019 100,000 12,000,000 132,490 - 40,289,323
Additions - 150,903 - - - 6,635,210 6,786,113
Disposals - - - - - - -
Translation adjustment (1,917) (52,902) - - (45,647) (24,359) (124,825)
Balance as at 30 Sept 2019 24,110,897 4,042,020 100,000 12,000,000 132,490 6,610,851 46,996,258
Accumulated amortisation
Balance as at 01 April 2019 24,112,814 3,559,966 - - 132,490 - 27,805,270
Amortisation/impairment for the period - 198,937 - - - 618,554 817,491
Disposals - - - - - - -
Translation adjustment (1,917) (47,322) - - - 569 (48,670)
Balance as at 30 Sept 2019 24,110,897 3,711,581 - - 132,490 619,123 28,574,091
Carrying values as at 30 Sept 2019 - 330,439 100,000 12,000,000 - 5,991,728 18,422,167
*Customer contracts are intangible assets created for long standing customer
relationships in the content delivery segment. Once the relationship is
established the work continues to flow on a year to year basis. The carrying
amount of such contracts is Nil.
**Right of Use Asset has been generated in compliance with adoption of IFRS 16
on Lease Accounting.
7. PROPERTY, PLANT AND EQUIPMENT
Property, plant and equipment comprise of the following:
Particulars Computer and data equipment Office Equipment Furniture and fixtures Air conditioner and generator Vehicle Leasehold improvements Plant and machinery Capital work in progress Total
Cost
Balance as at 01 April 2018 6,109,821 874,293 1,247,285 378,237 37,066 4,400,598 2,256,054 122,531 15,425,885
Additions 2,741,100 43,318 284,368 565,532 - 593,856 210,222 101,777 4,540,173
Disposals (Net) (121,154) (12,438) (20,576) (5,678) (14,885) - (18,356) - (193,087)
Translation and other adjustment (323,214) (50,401) (72,347) (21,372) (1,434) (277,327) (131,350) - (877,445)
Balance as at 31 March 2019 8,406,553 854,772 1,438,730 916,719 20,747 4,717,127 2,316,570 224,308 18,895,526
Accumulated depreciation
Balance as at 01 April 2018 4,782,524 719,304 740,357 208,657 30,768 2,545,403 1,748,184 - 10,775,197
Depreciation for the year 1,158,555 111,228 316,403 66,624 1,697 457,759 236,334 - 2,348,600
Disposals (Net) (121,154) (12,366) (20,559) (26) (14,885) - (18,356) - (187,346)
Translation and other adjustments (297,468) (40,102) (40,177) (13,150) (1,019) (156,878) (99,203) - (647,997)
Balance as at 31 March 2019 5,522,457 778,064 996,024 262,105 16,561 2,846,284 1,866,959 - 12,288,454
Carrying values as at 31 March 2019 2,884,096 76,708 442,706 654,614 4,186 1,870,843 449,611 224,308 6,607,072
Particulars Computer and data equipment Office Equipment Furniture and fixtures Air conditioner and generator Vehicle Leasehold improvements Plant and machinery Capital work in progress Total
Cost
Balance as at 01 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 1,037,685 18,062 13,039 17,696 280,348 83,930 92,826 (21,999) 1,521,587
Disposals (Net) (78,892) - - - - - (5,215) - (84,107)
Translation and other adjustment (123,241) (10,917) (18,707) (13,026) (909) (66,006) (29,339) (1,572) (263,717)
Balance as at 30 Sept 2019 9,242,105 861,917 1,433,062 921,389 300,186 4,735,051 2,374,842 200,737 20,069,289
Accumulated depreciation
Balance as at 01 April 2019 5,522,457 778,064 996,024 262,104 16,561 2,846,284 1,866,960 - 12,288,454
Depreciation for the period 767,123 37,675 50,621 57,422 5,759 230,206 97,020 - 1,245,826
Disposals (Net) (78,335) - - - - - (5,215) - (83,550)
Translation and other adjustments (80,279) (9,689) (12,807) (4,103) (266) (38,569) (22,762) - (168,475)
Balance as at 30 Sept 2019 6,130,966 806,050 1,033,838 315,423 22,054 3,037,921 1,936,003 - 13,282,255
Carrying values as at 30 Sept 2019 3,111,139 55,867 399,224 605,966 278,132 1,697,130 438,839 200,737 6,787,035
8. SHORT TERM FINANCIAL ASSETS
Particulars 30 September 2019 31 March 2019
Security deposits 9,126 11,985
Restricted cash 5,055,927 4,747,604
Short term investments (fixed deposits with maturity less than 12 months) 2,758,929 1,803,959
Derivative financial instruments 9,487 426,984
Due from officers and employees 62,526 20,032
Others 7,190 47,891
7,903,185 7,058,455
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 2019 is as follows:
asic earnings per share
Particulars 30 September 2019 30 September 2018
Profit attributable to shareholders 21,571,617 17,257,657
Weighted average numbers shares outstanding 190,130,008 190,130,008
Basic earnings per share (US$) 0.11 0.09
Diluted earnings per share
Particulars 30 September 2019 30 September 2018
Profit attributable to shareholders 21,571,617 17,257,657
Weighted average numbers shares outstanding 190,130,008 190,130,008
Diluted earnings per share (US$) 0.11 0.09
10. 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 party Mr. Anil Aggarwal
II. Entities directly or indirectly through one or more intermediaries,
control, are controlled by, or are under common control with, the reported
enterprises EICR (Cyprus) Limited (Parent of iEnergizer Limited)
III. Key management personnel ("KMP") and significant shareholders Mr. Anil Aggarwal (Ultimate Shareholder, EICR Limited)
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) w.e.f.
16 August 2018
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 2019 30 September 2018
Transactions during the period ended
Short term employee benefits
Remuneration paid to directors
Chris de Putron 6,249 6,559
Mark De La Rue 6,249 6,559
Marc Vassanelli 18,747 19,678
Balances at the end of
Total remuneration payable 109,385 71,678
11. 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
3. Others
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. In addition, two minor
operating segments, for which the quantitative thresholds have not been met,
are currently combined below under 'Others'. Segment information can be
analysed as follows for the reporting periods under review:
30 September 2019
Business Process Outsource Content delivery Others Total
Revenue from external customers 59,433,379 35,747,517 - 95,180,896
Other income (including realised foreign exchange gain) 1,023,702 280,168 4,524 1,308,394
Segment revenue 60,457,081 36,027,685 4,524 96,489,290
Less:-
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 3,339,716 2,726,155 500,227 6,566,098
Earning before interest, tax, depreciation and amortisation 20,784,450 8,834,288 (495,703) 29,123,034
Rent credit adjustment as per IFRS 16 (281,860) (602,398) - (884,258)
Earning before interest, tax, depreciation and amortisation (before IFRS 16 20,502,589 8,231,890 (495,703) 28,238,776
rent credit adjustment )
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 19,824,918 7,469,058 (495,703) 26,798,273
Other Income/expense :
Finance income 135,427 113,968 110,712 360,107
Finance costs (256,274) (1,119,634) (823,735) (2,199,643)
Profit before tax 19,704,071 6,463,392 (1,208,726) 24,958,737
Income tax expense 1,954,446 1,432,675 - 3,387,120
Profit after tax 17,749,626 5,030,717 (1,208,726) 21,571,617
Segment assets 48,324,778 156,564,586 17,175,505 222,064,869
Segment liabilities 20,317,643 48,416,000 17,931,212 86,664,855
Capital expenditure 4,682,531 3,625,169 - 8,307,700
30 September 2018
Business Process Outsource Content delivery Others Total
Revenue from external customers 48,093,184 34,268,125 - 82,361,309
Other income (including realized foreign exchange gains) 409,617 471,386 850 881,853
Segment revenue 48,502,801 34,739,511 850 83,243,162
Less:-
Cost of outsourced Services 13,506,125 4,453,231 - 17,959,356
Employee benefit expense 15,973,780 19,310,627 - 35,284,407
Other expenses 1,749,646 3,515,201 470,577 5,735,424
Earning before interest, tax, depreciation and amortisation 17,273,250 7,460,452 (469,727) 24,263,975
Unrealized Foreign Exchange gain/(loss) - 1,842,918 - 1,842,918
Depreciation and amortisation 605,108 2,075,260 - 2,680,368
Segment operating profit 16,668,142 7,228,110 (469,727) 23,426,525
Other Income/expense :
Finance income 138,957 126,948 22,303 288,208
Finance costs (16,061) (1,139,625) (1,604,916) (2,760,603)
Profit before tax 16,791,038 6,215,433 2,052,340 20,954,131
Income tax expense 2,526,676 1,169,797 - 3,696,473
Profit after tax 14,264,361 5,045,637 2,052,340) 17,257,658
Segment assets 43,431,117 75,456,382 86,626,765 205,514,264
Segment liabilities 15,147,228 46,029,831 22,606,489 83,783,548
Capital expenditure 1,874,708 339,414 - 2,214,122
Revenue from the following customer's amounts to more than 10% of consolidated
revenue during the period presented.
30 September 2019
Revenue from Segment Amount
Customer 1 Business Process Outsource 9,928,185
30 September 2018
Revenue from Segment Amount
Customer 1 Business Process Outsource 9,763,189
12. 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 2019 31 March 2019
Non-current assets
Loans and receivables
Security deposits 530,183 507,498
Restricted cash 109,259 108,591
Fixed deposit - 1,065,892
Current assets
Loans and receivables
Trade receivables 34,623,099 36,675,342
Cash and cash equivalents 42,072,283 42,413,215
Restricted cash 5,055,927 4,747,604
Security deposits 9,126 11,985
Short term investments 2,758,929 1,803,959
Due from officers and employees 62,526 20,032
Other short term financial assets 7,190 47,891
Fair value through profit and loss:
Derivative financial instruments 9,487 426,984
85,238,009 87,828,993
Financial liabilities 30 September 2019 31 March 2019
Non-current liabilities
Financial liabilities measured at amortized cost:
Long term borrowings 38,743,275 870,535
Current liabilities
Financial liabilities measured at amortized cost:
Short term borrowings - 8,934
Trade payables 13,497,589 10,574,896
Current portion of long term borrowings 10,045,091 45,403,496
Other current liabilities 10,018,000 9,725,465
Fair value through profit and loss:
Derivative financial instruments - -
72,303,955 66,583,326
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.
13. 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:
30 September 2019 Total Fair value measurements at reporting date using
Level 2
Liabilities (Notional amount)
Derivative instruments
Forward contracts (currency - US$/INR) 32,440,000 9,487
31 March 2019 Total Fair value measurements at reporting date using
Level 2
Assets (Notional amount)
Derivative instruments
Forward contracts (currency - US$/INR) 18,700,000 426,984
14. COMMITMENT AND CONTINGENCIES
As at 30 September 2019 and 31 March 2019, the Group had a capital commitment
of US$ 257,684 and US$126,817 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$129,483 and US$122,834 as on 30
September 2019 and 31 March 2019 respectively and in respect of interest on
VAT amounts to US$9,918 as on 30 September 2019 (US$10,060 as on 31 March
2019).
Guarantees: As at 30 September 2019 and 31 March 2019, guarantees provided by
banks on behalf of the group companies to the revenue authorities and certain
other agencies, amount to approximately US$34,555 and US$35,049 respectively.
15. 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 2019 and 2018.
16. 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 2019 and 2018.
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