ACN For personal use only - ASX2015/08/31 · 8. The company opened an office in Indonesia...
Transcript of ACN For personal use only - ASX2015/08/31 · 8. The company opened an office in Indonesia...
31 August 2015
The Manager
Company Announcements
Australian Securities Exchange
Level 5, 20 Bridge Street
SYDNEY NSW 2000
By Electronic Lodgement
Dear Sirs
Appendix 4E and Preliminary Final Report
Please find enclosed the Company’s Appendix 4E and Preliminary Final Report for the year ended 30 June 2015.
If you have any queries, please contact the undersigned on +61 2 8072 1400.
Yours faithfully
Andrew Whitten Company Secretary
Level 2, 460 Bourke Street
Melbourne, VIC 3000
T 1300 885 812
F +61 3 9923 6065
ACN 112 452 436
(ASX:RHP)
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RESULTS FOR ANNOUNCEMENT TO MARKET Key Information
2015 2014 A $000’s A $000’s Revenues from ordinary activities 108,769 74,548 Net Profit/(loss) before tax attributable to members
(1,535) 1,370
Net Profit/(loss) after tax attributable to members
(2,321) 884
DIVIDENDS PAID AND PROPOSED There were no dividends paid or proposed during the year by rhipe Limited.
DIVIDEND REINVESTMENT PLAN There was no dividend reinvestment plan in operation which occurred during the financial year.
EARNINGS (LOSSES) PER SHARE (EPS) 2015 2014
Basic EPS (1.98) cents 0.51 cents Diluted EPS (1.98) cents 0.50 cents
NTA BACKING
Net tangible asset backing per ordinary security $0.1158 $0.0266
CONTROL GAINED OR LOST OVER ENTITIES IN THE YEAR
Control gained over entities during the year
Pt Rhipe International Indonesia (formerly PT NewLease International Indonesia)
23 July 2014
Rhipe LiveTiles Pty Limited 12 December 2014
Rhipe Cloud Solutions Pty Ltd (formerly nSynergy OSC Holdings Pty Ltd)
15 December 2014
Rhipe Solutions Australia Pty Ltd (formerly nSynergy OSC Pty Ltd)
15 December 2014
Rhipe Solutions LLC (formerly OnlineSC LLC)
15 December 2014
Loss of control of entities during the year Nil
STATUS OF THE AUDIT
The accounts are currently in the process of being audited.
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COMMENTARY ON THE RESULTS FOR THE PERIOD
The audited financial statements of rhipe Limited and its subsidiaries will be released in September 2015 with further detailed notes to the accounts.
The unaudited results presented in this financial report reflect the operations of rhipe Limited and all subsidiaries from 1 July 2014 to 30 June 2015 (together the “Group”).
For the full year ended 30 June 2015, Group revenue was $108.8m, up 46% compared to the prior year comparative period. Group earnings prior to growth investments, non-cash share based payments, non-recurring due diligence costs and non-recurring one off costs was $4.9m, up 47% on a like-for-like basis compared to the prior year comparative period. Licensing Revenue was $105.1m, up 41% and License Gross margin was $16.45m, up 37% compared to the prior year comparative period. The Licensing Gross margin % for the financial year to 30
June 2015 was 15.66%. Group Gross margin was $20.1m for the financial year, up 67% on the prior comparative period.
Financial Summary ($’000) FY15 FY14 Change
Licensing Revenue (Annuity Subscription) (3) 105,052 74,548 + 41%
Services Revenue 3,717 - n/a
Total Revenue 108,769 74,548 + 46%
Gross Margin Licensing Gross Margin Services
16,452
3,631
11,991
-
+ 37%
n/a Total Gross Margin
Underlying EBITDA pre growth investment &
non-cash and non-recurring (1)
20,083
4,896
11,991
3,332
+ 67%
+ 47%
Underlying EBITDA pre non-cash and non-recurring(2)
1,222 1,832 - 33%
(1) Underlying EBITDA pre Growth excludes Net Investment in SEA and Cloud LSP after local gross margin contributions, CSP teams and Group
Support Costs.
(2) Underlying EBITDA excludes non-cash expenses relating to share based payments for executive options issued and non-recurring expenses such
as transaction costs associated with nSynergy acquisition (Dec14), executive team recruitment and impairment write down for assets held for
re-sale.
(3) Licensing Revenue excludes approximately $2.5m revenue received for prepaid licensing sales on 29 June 2015 which will be recognised in
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During the 12-month period to 30 June 2015, rhipe invested heavily in the transition of its operations from a purely private-cloud licensing business to “Whole of Cloud” wholesaler with integrated divisions focused on cloud
licensing (private, public and hybrid), cloud solutions (services and support), and cloud operations (billing, provisioning, marketing). rhipe’s investment in these operating divisions led to a number of significant achievements that have set the foundation for rhipe’s ongoing growth:
1. In December 2014, rhipe completed the strategic acquisition of nSynergy to form the new rhipe Solutions business unit. This acquisition paved the way for rhipe’s bid to represent Microsoft as a wholesaler of Microsoft’s public cloud offerings.
2. In April 2015 rhipe was awarded the Microsoft 2-Tier Cloud Solutions Program (CSP) for Australia. This program allows rhipe to wholesale Microsoft’s public cloud offerings such as Office365, Azure and Enterprise Mobility Suite (EMS) to rhipe’s reseller channel on a monthly subscription “pay-as-you-use” basis.
3. From December 2014 to June 2015, rhipe also engaged with Microsoft in 5 South East Asian countries in relation to their 2-Tier CSP wholesaler program. In July 2015 rhipe was subsequently awarded the 2-Tier CSP program in each of these countries.
4. As part of the acquisition of nSynergy, rhipe also made an investment in cloud software company, LiveTiles. This investment provided rhipe with exclusive distribution rights for the LiveTiles product to
service providers in Asia Pacific. 5. During the financial year rhipe worked closely with SoftLayer, an IBM company, to explore how rhipe could
wholesale the SoftLayer infrastructure to rhipe’s reseller channel in all seven of rhipe’s operating countries. rhipe was subsequently awarded the Cloud-wholesaler vendor agreement for Softlayer in APAC for Q1/ FY16 implementation
6. rhipe signed new licensing relationships with Intel Security (McAfee), Zimbra, LiveTiles and SkyKick. 7. rhipe built a dedicated Cloud Licensing Solutions Provider (LSP) team as a result of signing a new pilot
cloud licensing program with Microsoft Australia (the Cloud LSP program) and achieved 200% attainment of targets.
8. The company opened an office in Indonesia following signing a new SPLA licensing agreement with Microsoft in August of 2014, and
9. Over the year, rhipe greatly expanded its executive team with a new Chief Executive Officer, Chief Financial Officer, Chief Commercial Officer, Chief Marketing Officer, Chief Technology Officer and Chief Strategy Officer.
rhipe’s key software vendor relationships include those with Microsoft, VMWare, Citrix, Datacore, Intel Security (McAfee), Red Hat, Trend Micro, Veeam, Zimbra, LiveTiles and SkyKick. rhipe sells and manages subscription software to over 1600 Channel customers including Managed Service Providers (MSPs), Independent Software Vendors (ISVs) and System Integrators (SIs). rhipe also supports these channel customers with value-add services including business transformation consulting, marketing and lead generation, order processing and license optimisation and compliance consulting.
rhipe’s services and support offerings (resulting from the acquisition of nSynergy) are currently focused on
Microsoft technologies such as Office365 and Azure. The nSynergy business was integrated into rhipe over a 6 month period and rebranded to “rhipe solutions” in June, 2015. The business generated un-audited revenue of $3.72m and EBIT $0.23m for the period to June 2015. The purchase price of nSynergy, post finalising completion accounts and agreement with the vendors, was reduced from the headline figure of $25.35m (as announced on 28th November) to $14.35m, which comprises:
•$10m cash paid at completion in December 2014
•$4.35m stock in rhipe issued, escrowed to December 2015.
The reduction of $11m from that announced on 28th November comprises:
•$3m of cash which has been retained by rhipe to meet working capital requirements, and
•$8m of potential earn out for 2016 and 2017 which will be replaced by standard rhipe bonus plans for senior team members.
rhipe’s growth continues to come from its heritage geographies of Australia and New Zealand with even higher growth from rhipe’s investment in South East Asia.
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The table below outlines the underlying EBITDA contribution from the Group for the year ending June 30,
2015:
$’000 Underlying EBITDA pre growth investment and non-cash and non-recurring (1)
4,896
Growth Investment expensed: Investment in South East Asia (2,459) Investment in Cloud Solutions Provider (CSP)Program (610) Investment in Cloud LSP Team (484) Investment in Group Support Costs (121) Underlying EBITDA pre non-cash and non-recurring costs (2)
Non-cash and Non-recurring expenses:
1,222
Non-recurring transaction costs and integration costs expensed (478) Non-cash share based payments expensed in accordance with accounting standards
(1,787)
Non-recurring impairment write-down for assets held for re-sale (157)
Non-recurring recruitment costs expensed for CEO (153) EBITDA Reported
(1,353)
Depreciation and amortisation
EBIT Reported
(182)
(1,535)
The table below extracts cash flow generated by operating activities before growth investment and non-recurring costs, payment of income tax and interest received. Adjusted cash generated from operations is $1.0m:
$’000 Calculation of Cash Flows (used in) / provided by Operating Activities adjusted for Growth
Investment and Non-recurring Costs:
Net cash (used in) / provided by operating activities per Consolidated Statement of Cash Flows:
(5,167)
Growth Investment expensed:
South East Asia 2,459 Cloud Solution Provider (CSP) Program 610 Cloud LSP Team 484 Group Support Costs 121
Non-recurring expenses: Transaction costs and integration costs 478 Recruitment costs expensed for CEO
153
Net cash (used in) / provided by operating activities pre Growth and Non-recurring Costs:
(862)
Increase in cash employed in growth in debtors (net of
increase in creditors):
1,184
being the change in net debtors/creditors 1/7/14 to 30/6/15:
2,282
less payment in July 2014 of June 2014 vendor payments (1,098)
Payment of income tax: 768
Interest received: (103)
Cash flow from operations before Growth and Non-recurring costs, net increase in debtors, tax and interest:
987
The directors believe that the Group is in a strong and stable financial position to continue to expand and grow the business. The Group currently has approximately $12.4m in cash at bank (2014: $4.4m).
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
1
rhipe Limited and its Controlled
Entities
ABN 91 112 452 436
Preliminary Final Report
for the year ended 30 June 2015
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Contents
Consolidated Statement of Profit or Loss and Other Comprehensive Income 2
Consolidated Statement of Financial Position 3
Consolidated Statement of Changes in Equity 4
Consolidated Statement of Cash Flows 5
Notes to the Preliminary Final Report 6
Compliance Statement 7
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
2
CONSOLIDATED STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME
FOR THE YEAR ENDED 30 JUNE 2015
Note
2015
$’000
2014
$’000
Sales Revenue 108,769 74,548 Cost of Sales (88,686) (62,557)
Gross Profit 20,083 11,991
Other income (185) (10) Employee benefits expense (12,958) (7,259)
Marketing expenses (1,254) (713) Office administration expenses (2,249) (1,228) IT systems & communications (280) (242) Travel expenses (1,110) (650)
Depreciation and amortisation (182) (98) Impairment write-down for assets held for sale (157) - Share based payments expense (1,787) (310) Finance costs (18) -
Other expenses (1,438) (111)
(Loss)/profit before income tax (1,535) 1,370
Tax expense (786) (486)
(Loss)/profit after tax for the year attributable to owners of the parent entity
(2,321) 884
Other comprehensive income:
Items that will be reclassified subsequently to profit or loss when specific conditions are met:
Exchange differences on translating foreign operations 66 (51)
Other comprehensive income/(expense) for the year
66
(51)
Total comprehensive (loss)/profit for the year attributable to owners of the parent entity
(2,255) 833
Earnings (losses) per share From continuing and discontinuing operations
Basic (losses)/earnings per share (cents) 2 (1.98) 0.51 Diluted (losses)/earnings per share (cents) 2 (1.98) 0.50
The Consolidated Statement of Comprehensive Income is to be read in conjunction with the Notes to the Preliminary Final Report.
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
3
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2015
2015
$’000
2014
$’000
ASSETS
CURRENT ASSETS
Cash and cash equivalents 12,423 4,457 Trade and other receivables 27,332 15,061 Other assets 3,253 281 Non-current assets held for sale 350 507
TOTAL CURRENT ASSETS 43,358 20,306
NON-CURRENT ASSETS Other financial assets 2,510 10
Property, plant and equipment 519 171 Deferred tax assets 770 329 Intangible assets 23,082 5,876
TOTAL NON-CURRENT ASSETS 26,881 6,386
TOTAL ASSETS 70,239 26,692
LIABILITIES
CURRENT LIABILITIES
Trade and other payables 27,151 17,162 Tax liabilities 709 527
Provisions 180 -
Deferred Consideration Liabilities associated with assets held for sale
3,000 158
- 158
TOTAL CURRENT LIABILITIES 31,198 17,847
NON-CURRENT LIABILITIES Deferred tax liabilities 508 205
Provisions 73 211
TOTAL NON-CURRENT LIABILITIES 581 416
TOTAL LIABILITIES 31,779 18,263
NET ASSETS 38,460 8,429
EQUITY Issued capital 38,602 8,103
Reserves 2,067 214 Retained earnings (2,209) 112
TOTAL EQUITY 38,460 8,429
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
4
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2015
Share Capital
Reserves
Ordinary Retained Earnings
Foreign Currency
Translation Reserve Reserve
Equity Settled
Employee Benefits Reserve
Total Equity
$’000 $’000 $’000 $’000 $’000 $’000
Balance at 1 July 2013 2,241 (772) (18) (27) - 1,424
Comprehensive income Profit for the year - 884 - - - 884 Other comprehensive income
for the year Exchange differences on translation of subsidiaries - - (51) - - (51)
Total comprehensive income for the year - 884 (51) - - 833 Transactions with owners, in their capacity as owners and other transfers
Shares issued during the year 1,070 - - - - 1,070 Transaction costs, net of tax (64) - - - - (64) Deemed cost of reverse acquisition 6,360 - - - - 6,360 Shares bought back during the year (1,504) - - - - (1,504) Share based payments - - - - 310 310
Total transactions with owners and
other transfers 5,862 - - - 310 6,172
At 30 June 2014 8,103 112 (69) (27) 310 8,429
Balance at 1 July 2014 8,103 112 (69) (27) 310 8,429
Comprehensive Income Loss for the year - (2,321) - - - (2,321) Other comprehensive income for the year Exchange differences on translation of subsidiaries - - 66 - - 66
Total comprehensive loss for the year - (2,321) 66 - - (2,255) Transactions with owners, in their capacity as owners and other transfers Shares issued during the year 31,252 - - - - 31,252
Transaction costs, net of tax (753) - - - - (753) Share based payments - - - - 1,787 1,787
Total transactions with owners and
other transfers 30,499 (2,321) 66 -
1,787 30,031
At 30 June 2015 38,602 (2,209) (3) (27)
2,097 38,460
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
5
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2015
2015 $’000
2014 $’000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers 105,616 76,300 Payments to suppliers and employees (110,118) (73,889) Interest received 103 76 Income tax paid (768) (140)
Net cash (used in)/provided by operating activities (5,167) 2,347
CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment (407) (31) Loans to related parties:
- Proceeds from repayments - 195
Payment for acquisition of subsidiary (9,564) - Cash held by subsidiary at acquisition - 959 Payment for intangibles (346) (358) Payment for investments (2,500) -
Net cash (used in)/provided by investing activities (12,817) 765
CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of shares, net 26,904 1,070 Payment for share issue costs (1,119) (91) Share buy-back payment - (1,504)
Dividends paid by parent entity - (126)
Net cash provided by / (used in) financing activities 25,785 (651)
Net increase in cash and cash equivalents 7,801 2,461
Cash and cash equivalents at beginning of year 4,457 1,997
Effect of exchange rates on cash holdings in foreign currencies 165 (1)
Cash and cash equivalents at end of year 12,423 4,457
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
6
NOTES TO THE PRELIMINARY FINAL REPORT
1. EVENTS AFTER BALANCE SHEET DATE
Other than the following, the directors are not aware of any significant events since the end of the
reporting period. The purchase price of nSynergy, post finalising completion accounts and agreement
with the vendors, was reduced from the headline figure of $25.35m (as announced on 28th November)
to $14.35m, which comprises:
•$10m cash paid at completion in December 2014
•$4.35m stock in rhipe issued, escrowed to December 2015.
2. EARNINGS (LOSSES) PER SHARE
2015
(cents) 2014
(cents)
Basic EPS (1.98) 0.51
Diluted EPS (1.98) 0.50
Reconciliation of earnings to profit or loss $’000 $’000
Profit (2,321) 884
Earnings / (losses) used to calculate basic EPS (2,321) 884
Earnings / (losses) used in the calculation of dilutive EPS (2,321) 884
2015 No. of shares
2014 No. of shares
Weighted average number of ordinary shares outstanding during
the year used in calculating basic EPS
117,317,393 174,694,609
Weighted average number of dilutive options outstanding - 1,727,379
Weighted average number of ordinary shares outstanding during
the year used in calculating dilutive EPS
117,317,393 176,421,988
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rhipe Limited and Controlled Entities (formerly Rhype Limited) ABN 91 112 452 436
Preliminary Final Report for the year ended 30 June 2015
7
COMPLIANCE STATEMENT
This preliminary final report has been prepared in accordance with the requirements of the Corporations
Act 2001, Australian Accounting Standards, Australian Accounting Interpretations and other authoritative
pronouncements of the Australian Accounting Standards Board.
The preliminary final report covers the economic entity of rhipe Limited and Controlled Entities, and rhipe
Limited as an individual parent entity. rhipe Limited is a listed public company, incorporated and
domiciled in Australia.
The preliminary final report of rhipe Limited and Controlled Entities, and rhipe Limited as an individual
parent entity have been prepared in accordance with all Australian equivalents to International Financial
Reporting Standards (AIFRS) in their entirety. This report, and the accounts on which it is based, use
the same accounting policies.
This report gives a true and fair view of the matters disclosed.
This report is based on accounts which are in the process of being audited.
Dominic O’Hanlon (Managing Director)
31st August 2015
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