REG - Subex Limited - Outcome of Board Meeting held on October 28, 2021
RNS Number : 7106QSubex Limited29 October 2021
October 29, 2021
To
The London Stock Exchange
10 Paternoster Square
London
EC4M 7LS
Dear Sir/Madam,
Sub: Subex Limited "The Company"-Outcome of the Board Meeting held on October 28, 2021
Please be informed that the agenda items summarized hereunder were discussed and approved at the Board Meeting held on October 28, 2021 at Bengaluru:
1. Approval of the Unaudited Standalone and Consolidated Financial Results of the Company for the quarter and half year ended September 30, 2021.
2. Approval of transfer of Revenue Maximization Solution business from Subex Assurance LLP, material wholly owned subsidiary of the Company, to the Company.
3. Change in the Key Managerial Personnel
Mr. Venkatraman G S, Chief Financial Officer and Key Managerial Personnel of the Company, has tendered his resignation and the Board approved his resignation with effect from December 10, 2021.
Please find enclosed:
· The Unaudited Consolidated Financial Results of the Company for the quarter and half year ended September 30, 2021.
We request you to take on record the aforesaid information.
Thanking you
Yours truly,
For Subex Limited
Sd/-
Vinod Kumar Padmanabhan
Managing Director & CEO
DIN:06563872
SUBEX LIMITED
Registered office: Pritech Park - SEZ, Block-09, 4th Floor, B Wing, Survey No. 51-64/4, Outer ring road, Bellandur Village,Varthur Hobli, Bangalore -560 103
Statement of Unaudited Consolidated Financial Results for the quarter and six months ended September 30, 2021
( ₹ in Lakhs)
Quarter ended
Year to date figures for the six months ended
Year ended
Particulars
September 30, 2021
June 30, 2021
September 30, 2020
September 30, 2021
September 30, 2020
March 31, 2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
1
Revenue from operations
8,630
8,060
9,329
16,690
18,199
37,203
2
Other income
97
671
100
768
196
474
3
Total income (1+2)
8,727
8,731
9,429
17,458
18,395
37,677
Expenses
Employee benefits expense (Refer note 4)
5,442
5,107
4,890
10,549
9,447
19,720
Finance costs
33
41
103
74
213
296
Depreciation and amortization expense
246
242
365
488
731
1,378
Other expenses
2,198
1,333
1,899
3,531
3,252
7,633
4
Total expenses
7,919
6,723
7,257
14,642
13,643
29,027
5
Profit before exceptional items and tax (3-4)
808
2,008
2,172
2,816
4,752
8,650
Exceptional items
Provision for service tax receivable (Refer note 6)
Gain on termination of lease agreement (Refer note 7)
-
-
(267)
-
(267)
(267)
-
-
554
-
554
554
6
Total exceptional items
-
-
287
-
287
287
7
Net profit before tax (5+6)
808
2,008
2,459
2,816
5,039
8,937
8
Tax expense, net
Current tax charge
Provision - foreign withholding taxes (Refer note 8)
Deferred tax charge (including MAT credit entitlement) (Refer note 9)
164
92
7
256
8
696
162
65
386
227
732
399
-
503
841
503
1,558
2,670
Total tax expense
326
660
1,234
986
2,298
3,765
9
Net profit for the period/ year (7-8)
482
1,348
1,225
1,830
2,741
5,172
10
Other comprehensive income/ (loss) net of tax expense
Items that will be reclassified subsequently to profit or loss:
Net exchange differences (loss)/ gain on translation of foreign operations
Items that will not be reclassified subsequently to profit or loss:
Re-measurement loss on defined benefit plan
(33)
150
158
117
120
636
(67)
(3)
(20)
(70)
(24)
(12)
Total other comprehensive (loss)/ income
(100)
147
138
47
96
624
11
Total comprehensive income for the period/ year (9+10)
382
1,495
1,363
1,877
2,837
5,796
12
Paid up equity share capital
28,100
28,100
28,100
28,100
28,100
28,100
[face value of ₹ 5 (March 31, 2021: ₹ 5)]
13
Other equity
-
-
-
-
-
26,755
14
Earnings per share (of ₹ 5/- each) (not annualised in case of the interim periods)
- Basic
0.09
0.25
0.23
0.34
0.51
0.96
- Diluted
0.09
0.24
0.23
0.33
0.51
0.94
SUBEX LIMITED
Registered office: Pritech Park - SEZ, Block-09, 4th Floor, B Wing, Survey No. 51-64/4, Outer ring road, Bellandur Village,Varthur Hobli, Bangalore -560 103
Statement of Consolidated Assets and Liabilities
(₹ in Lakhs)
A
B
As at
Particulars
September 30, 2021
March 31, 2021
Unaudited
Audited
ASSETS
Non-current assets
Property, plant and equipment
1,216
1,177
Right-of-use assets
1,608
1,962
Goodwill on consolidation
34,409
34,409
Financial assets
Other balances with banks
104
39
Other financial assets
305
300
Income tax asset (net)
4,048
3,479
Deferred tax asset (Including MAT credit entitlement)
51
125
41,741
41,491
Current assets
Financial assets
Loans
165
220
Investment
754
-
Trade receivables
7,312
9,215
Cash and cash equivalents
12,864
14,294
Other balances with banks
336
379
Other financial assets
7,535
6,428
Other current assets
875
639
29,841
31,175
Total Assets
71,582
72,666
EQUITY AND LIABILITIES
Equity
Equity share capital
28,100
28,100
Other equity
27,583
26,755
Total equity
55,683
54,855
Liabilities
Non-current liabilities
Financial liabilities
Lease Liabilities
1,167
1,575
Provisions
364
275
Deferred tax liabilities(net)
6,718
6,289
8,249
8,139
Current liabilities
Financial liabilities
Borrowings
-
584
Lease Liabilities
494
420
Trade payable
- total outstanding dues of micro enterprises and small enterprises
89
66
- total outstanding dues of creditors other than micro enterprises and small enterprises
1,266
1,245
Other financial liabilities
1,520
3,045
Other current liabilities
2,760
2,935
Provisions
906
791
Income tax liabilities (net)
615
586
7,650
9,672
Total liabilities
15,899
17,811
Total equity and liabilities
71,582
72,666
SUBEX LIMITED
Consolidated Statement of cash flows for the six months ended September 30, 2021
( ₹ in Lakhs)
Six months ended
Particulars
September 30, 2021
September 30, 2020
Unaudited
Unaudited
(A)
Operating activities
Profit before tax
2,816
5,039
Adjustments to reconcile profit before tax to net cash flows:
Depreciation of property, plant and equipment and right-of-use assets
488
729
Amortization of intangible assets
-
2
Interest income (including fair value changes)
(154)
(189)
Profit on sale of investments
(4)
-
Fair value gain on financial instruments at fair value through profit or loss
(2)
-
Finance costs (including fair value changes)
74
213
Allowance/ (reversal) for expected credit losses
336
(171)
Share based payment expenses
60
74
Gain on termination/modification of lease
(12)
(554)
Provision for service tax receivable
-
267
Waiver of borrowings
(584)
-
Net foreign exchange (gain)/ loss
(50)
314
Operating profit before working capital changes
2,968
5,724
Working capital adjustments:
(Increase)/ decrease in loans
67
(731)
(Increase)/ decrease in trade receivables
1,721
355
(Increase)/ decrease in other financial assets
(999)
430
(Increase)/ decrease in other assets
(238)
(151)
Increase/ (decrease) in trade payables
32
(697)
Increase/ (decrease) in other financial liabilities
(1,501)
(347)
Increase/ (decrease) in other current liabilities
(227)
874
Increase/ (decrease) in provisions
116
89
1,939
5,546
Income tax paid (including TDS, net of refund)
(1,025)
(608)
Net cash flows from operating activities
914
4,938
(B)
Investing activities
Purchase of property, plant and equipment
(351)
(210)
Investments in Mutual Funds (net)
(748)
-
Movement in margin money deposit (net)
(19)
(69)
Purchase of treasury shares by ESOP trust
-
(22)
Interest received
143
121
Net cash flows used in investing activities
(975)
(180)
(C)
Financing activities
Proceeds from exercise of ESOP
257
31
Proceeds from borrowings
-
600
Interest paid
(66)
(201)
Repayment of lease liability
(191)
(508)
Payment of dividends
(1,346)
-
Net cash flows used in financing activities
(1,346)
(78)
(D)
Net (decrease)/ increase in cash and cash equivalents (A+B+C)
(1,407)
4,680
Net foreign exchange difference on cash and cash equivalents
(23)
42
Cash and cash equivalents at the beginning of the period
14,294
9,043
(E)
Cash and cash equivalents at the end of the period
12,864
13,765
1
Notes:
The above results have been reviewed by the Audit Committee and approved by the Board of Directors in their meeting held on October 28, 2021.
The financial results have been prepared in accordance with the recognition and measurement principles laid down in the applicable Indian Accounting Standards ("Ind AS") prescribed under section 133 of the Companies Act, 2013, read with relevant rules thereunder and in terms of Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended.
The financial results of Subex Limited (Standalone information):
( in Lakhs)
2
3
Quarter ended
Year to date figures for the six months ended
Year ended
Particulars
September 30, 2021
June 30, 2021
September 30, 2020
September 30, 2021
September 30, 2020
March 31, 2021
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Total income
1,559
1,700
1,095
3,146
2,427
5,510
Net profit before tax
49
269
440
318
1,340
2,651
Net profit for the period/ year
49
269
436
318
1,336
2,622
Total comprehensive income for the period/ year
32
269
434
301
1,333
2,622
4
Employee benefits expenses for the quarters ended September 30, 2021, June 30, 2021, and September 30, 2020 are net of reversal of provision no longer required, in respect of employee incentives relating to sales and delivery
commissions, amounting to ₹ 327 Lakhs, ₹ 786 Lakhs and ₹ 62 Lakhs, respectively, and for the six months ended September 30, 2021 and September 30, 2020 amounting to ₹ 786 Lakhs and ₹ 333 Lakhs, respectively and for
the year ended March 31, 2021 amounting to ₹ 333 lakhs.
5
As at March 31, 2021, the Company assessed and concluded the carrying value of it's goodwill along with carrying value of related Cash Generating Units ('CGUs') is appropriate. There is no change in the management's
assessment as regards the aforementioned carrying value of it's goodwill along with carrying value of related CGU as at September 30, 2021.
6
During the previous year ended March 31, 2021, service tax receivable of ₹ 267 lakhs had been provided for considering the uncertainty as regards to its realisation.
7
Represents gain arising on termination of the lease agreement of existing office premises in India, accounted in accordance with Ind AS 116 - Leases.
8
Represents reversal/provision in respect of foreign withholding taxes deducted/ deductible by the overseas customers of the Group. Considering the expected utilisation of foreign withholding taxes, provision of ₹ 723 Lakhs
(including provision of 279 Lakhs as at April 01, 2020) made during the earlier quarters, has been reversed during the quarter ended March 31, 2021.
9
Deferred tax charge/(credit), comprises of liability arising on account of tax benefits from amortisation of intangible assets of Subex Assurance LLP, net of deferred tax assets arising on account of carry forward losses and other
taxable temporary differences, which arose mainly on account of business restructuring effected from November 1, 2017, wherein, the Company's RMS business and the Digital business was transferred on going concern basis to
Subex Assurance LLP and Subex Digital LLP respectively.
10
The Group is engaged in the business of software products and related services, which are monitored as a single segment by the Chief Operating Decision Maker, accordingly, these, in the context of Ind AS 108 on Operating
Segments Reporting are considered to constitute one segment and hence the Group has not made any additional segment disclosures.
11
The full impact of COVID - 19 still remains uncertain and could be different from the estimates considered while preparing these consolidated financial results. The Group shall continue to closely monitor any material changes
to future economic conditions.
12
The Code on Social Security, 2020 ('Code') relating to employee benefits during employment and post-employment benefits received Presidential assent in September 2020. The Code has been published in the Gazette of India.
However, the date on which the Code will come into effect has not been notified and the final rules/interpretation have not yet been issued. The Group will assess the impact of the Code when it comes into effect and will record
any related impact in the period the Code becomes effective.
13
The Board of Directors had recommended a final dividend of ₹ 0.25/-(5%) per equity share on face value of ₹ 5/- each for the financial year 2020-2021. The same was approved by the shareholders in the Annual General Meeting
of the Company held on July 9, 2021 and was paid on July 20, 2021.
14
The US Federal government in the wake of COVID 19 pandemic provided support to business through Paycheck Protection Program (PPP). Subex Inc. obtained a benefit under this scheme for ₹600 Lakhs during May 2020.
During the previous quarter ended June 30, 2021, Subex Inc. obtained complete waiver of the loan amount from Small Business Administration, United States government agency and accordingly the loan and interest accrued
thereon was recognised as other income.
15
The Board of Directors of the Company in its meeting held on October 28, 2021 has approved the restructuring of the business, subject to all requisite approvals, wherein the business carried out by Subex Assurance LLP will be
transferred to Subex Limited on a 'going concern' basis excluding Developed Technology and Investment in subsidiaries. The aforesaid restructuring is being carried out to achieve higher operational efficiencies upon
integration and consolidation of business in the listed entity.
16
The comparative figures have been regrouped / reclassified, wherever necessary, to make them comparable with the current period.
Place: Bengaluru
Date: October 28, 2021
For further details on the results, please visit our website: www.subex.com
Vinod Kumar Padmanabhan Managing Director & CEO
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