REG - Subex Limited - Outcome of the Board Meeting February 01,2021
February 02, 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 February 01, 2021.
Please be informed that the agenda items summarized hereunder were discussed and approved at the Board Meeting held on February 01, 2021 at Bengaluru:
Financial Results:
1. The Unaudited Standalone and Consolidated Financial Results of the Company for the quarter and nine-months ended December 31, 2020.
Others Matters:
2. Declaration of interim dividend of Rs. 0.5/- (10 %) per equity share of par value of Rs.5/- each for the financial year 2020-21. Further, pursuant to Regulation 42 of SEBI (Listing Obligations and Disclosure Requirements), 2015 "SEBI (LODR) Regulations, 2015", the Company has fixed February 11, 2021 as Record Date for determining the eligibility of the shareholders for Interim Dividend. The Interim Dividend will be paid on or before March 02, 2021.
3. Change in the terms of appointment of Mr. Shiva Shankar Naga Roddam, (DIN: 07212118), Whole-Time Director & COO of the Company, with effect from February 01, 2021.
4. Re-classification of the below persons belonging to the 'Promoter/Promoter Group' category, to the 'Public' Category. The approval of the Board towards reclassification is subject to the approval of the members of the Company and the other regulatory authorities, if any, in terms of Regulation 31A of SEBI (LODR) Regulations, 2015 and amendments thereof.
Sl. No.
Names of the Promoter/Promoter Group
No. of shares held
1.
Mr. Subash Menon-Promoter
NIL
2.
Mr. Sudeesh Yezhuvath- Promoter Group
3.
Kivar Holdings Private Limited- Promoter Group
5. Appointment of V. Sreedharan & Associates, Company Secretaries, for conducting the Secretarial Audit for the financial year 2020-21.
6. Appointment of RSM Astute Consulting Pvt. Ltd as Internal Auditors of the Company for the financial year ending March 31, 2022.
7. Grant of 12,40,500 Stock options by the Nomination & Remuneration Committee of the Board of Directors, in accordance with ESOP 2018 Scheme of the Company.
Please find enclosed:
a) The Unaudited Consolidated Financial Results of the Company for the quarter and nine months ended December 31, 2020.
We request you to take the aforesaid notification on record.
Yours truly,
For Subex Limited
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, Bangalore -560 103
Statement of Unaudited Consolidated Financial Results for the quarter and nine months ended December 31, 2020
(₹ in Lakhs)
Quarter ended
Year to date figures for the nine months ended
Year ended
Particulars
December 31, 2020
September 30, 2020
December 31, 2019
December 31, 2020
December 31, 2019
March 31, 2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Income
1
Revenue from operations
9,388
9,329
9,609
27,587
26,071
36,498
2
Other income
106
100
52
302
228
563
3
Total income (1+2)
9,494
9,429
9,661
27,889
26,299
37,061
Expenses
Employee benefits expense (Refer note 4)
5,256
4,890
4,556
14,703
13,302
17,454
Finance costs
38
103
115
251
358
477
Depreciation and amortization expense
424
365
367
1,155
1,116
1,508
Exchange fluctuation loss/(gain), net
449
438
512
698
(39)
(887)
Other expenses
1,648
1,461
2,768
4,651
7,216
10,513
4
Total expenses
7,815
7,257
8,318
21,458
21,953
29,065
5
Profit before exceptional items and tax (3-4)
1,679
2,172
1,343
6,431
4,346
7,996
Exceptional items
Impairment of goodwill [Refer note 5(i)] Provision no longer required written back Provision for claim settlement [Refer note 5(ii)] Provision for service taxreceivable (Refer note6
Gain on termination of lease agreement (Refer note 7)
-
-
(31,473)
-
(31,473)
(31,473)
-
-
761
-
761
761
-
-
(1,054)
-
(1,054)
(1,054)
-
(267)
-
(267)
-
-
-
554
-
554
-
-
6
Total exceptional items
-
287
(31,766)
287
(31,766)
(31,766)
7
Net profit/ (loss) before tax (5-6)
1,679
2,459
(30,423)
6,718
(27,420)
(23,770)
8
Tax expense, net
Current tax charge
Provision for MAT credit [Refer note 8 (i)]
Provision - foreign withholding taxes [Refer note 8 (ii)] Deferred tax charge (Refer note 9)
49
7
80
57
82
117
-
-
-
-
-
425
208
386
163
940
647
754
551
841
606
2,109
1,964
1,849
Total tax expense
808
1,234
849
3,106
2,693
3,145
9
Net profit/ (loss) for the period/ year (7-8)
871
1,225
(31,272)
3,612
(30,113)
(26,915)
10
Other comprehensive income/ (loss) net of tax expense
Items that will be reclassified subsequently to profit or loss:
Net exchange differences gain on translation of foreign operations
Items that will not be reclassified subsequently to profit or loss:
Re-measurement loss on defined benefits plan
455
158
595
575
205
5
(14)
(20)
(20)
(38)
(55)
(34)
Total other comprehensive income/ (loss)
441
138
575
537
150
(29)
11
Total comprehensive income/ (loss) for the period/ year (9+10)
1,312
1,363
(30,697)
4,149
(29,963)
(26,944)
12
13
Paid up equity share capital (Refer note 10)
[face value of ₹ 5 each w.e.f September 29, 2020 and ₹ 10 upto September 28,
2020]
Other equity
28,100
-
28,100
-
56,200
-
28,100
-
56,200
-
56,200
(4,661)
14
Earnings/(loss) per share (of ₹ 5/- each w.e.f September 29, 2020 and ₹ 10 upto September 28, 2020) (not annualised in case of the interim periods) (Refer note 10):
- Basic
- Diluted
0.16
0.16
0.23
0.23
(5.77)
(5.77)
0.67
0.66
(5.51)
(5.51)
(4.94)
(4.94)
1
Notes:
The above results have been reviewed by the Audit Committee and approved by the Board of Directors in their meeting held on February 01, 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 nine months ended
Year ended
Particulars
December 31, 2020
September 30, 2020
December 31, 2019
December 31, 2020
December 31, 2019
March 31, 2020
Unaudited
Unaudited
Unaudited
Unaudited
Unaudited
Audited
Total income
510
1,095
289
2,937
731
3,170
Net profit/ (loss) before tax
125
440
(21,913)
1,465
(22,687)
(20,470)
Net profit/ (loss) for the period/ year
129
436
(21,913)
1,465
(22,687)
(20,588)
Total comprehensive income / (loss) for the period/ year
127
434
(21,915)
1,460
(22,961)
(20,609)
4
Employee benefits expenses for the quarters ended December 31, 2020, September 30, 2020, and December 31, 2019 are net of reversal of provision no longer required, in respect of employee incentives relating to sales and delivery commissions, amounting to ₹ 43 Lakhs, ₹ 62 Lakhs and ₹ 149 Lakhs, respectively, and that for the nine months ended December 31, 2020 and December 31, 2019 amounting to ₹ 333 Lakhs and ₹ 450 Lakhs, respectively and for that year ended March 31, 2020 amounting to ₹ 692 lakhs.
5
(i) During the previous year ended March 31, 2020, considering the challenges and significant investment requirements of telecom operators which has resulted in longer opportunity conversion cycle and lower spends towards IT solutions, the management had carried out the annual impairment exercise as at December 31, 2019 in respect of carrying value of goodwill and basis valuation carried out by an external valuation expert, had made an impairment provision of ₹ 31,473 Lakhs towards carrying value of goodwill. In view of the COVID -19 pandemic, the management has reassessed its projections and assumptions and has concluded that, the carrying value of it's goodwill as at December 31, 2020 is appropriate.
(ii) During the previous year ended March 31, 2020, the Company had entered into settlement agreement with former MD & CEO and former COO of the company in respect of long drawn litigation wherein certain claims were made against the Company. In terms of the settlement agreement, the Company has paid an amount of ₹ 820 lakhs (net of ₹ 234 Lakhs recoverable from such ex-employees). Accordingly, the aforesaid litigation is amicably settled.
6
During the previous quarter ended September 30, 2020, service tax receivable of ₹ 267 lakhs has 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
(i) During the previous year ended March 31, 2020, the MAT credit entitlement of ₹ 425 Lakhs has been provided considering the uncertainty with regards to its utilisation.
(ii) Represents provision in respect of withholding taxes deducted/ deductible by the overseas customers of the Group.
9
Deferred tax charge, 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 Board of Directors in its meeting held on February 07, 2020, approved a scheme of Capital Reduction in accordance with Section 52 of the Companies Act, 2013 and Section 66 of the Companies Act, 2013 read with National Company Law Tribunal ('NCLT') (Procedure for reduction of share capital of Company) Rules, 2016 and other applicable provisions of the Companies Act, 2013. The Hon'ble NCLT approved the said Scheme vide its order dated September 23, 2020. Consequently, the Company filed a certified copy of the Order with Registrar of Companies ('ROC') on September 29, 2020 and utilized an amount of ₹ 28,100 Lakhs from paid -up share capital of the Company by reducing the face value of the equity shares from ₹ 10/- to ₹ 5/- each and ₹ 10,301 Lakhs from securities premium to write-off its accumulated losses of ₹ 38,401 Lakhs.
11
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.
12
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.
13
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.
14
The Board of Directors at its meeting held on February 01,2021 has declared an interim dividend of ₹ 0.50/- (10 %) per equity share on face value of ₹ 5/- each for the financial year 2020-2021.
Place: Bengaluru
Date: February 01, 2021
For further details on the results, please visit our website: www.subex.com
Vinod Kumar Padmanabhan Managing Director & CEO
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