Interim Results

RNS Number : 5801F

iEnergizer Limited

12 November 2015

 



iEnergizer Limited and its subsidiaries

Unaudited Condensed Consolidated Interim Financial Statements

30 September 2015 and 2014

13 November 2015

iEnergizer Limited

("iEnergizer" or "the Company")

INTERIM RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2015

iEnergizer is pleased to announce its Interim Results for the six months ended 30 September 2015. iEnergizer is a digital publishing and technology leader, which benefits from the dual disruptive waves of big data and the cloud. The present structure of the group combines a well-established, high growth, business process solution enterprise with a leading provider of end-to-end digital transformation solutions to the media and publishing industries.

Financial Highlights

·      Revenues of $68.9m (H1 2015: $76.1m)

·      Adjusted EBITDA¹ $16.6m (H1 2015: $14.9m)

·      Adjusted EBITDA¹ margin at 24.1% (H1 2015: 19.6%)

·      Operating profit $13.7m (H1 2015: $9.8m)

·      Operating profit margin at 19.9% (H1 2015: 12.9%)

·      Cash and cash equivalents of $7.7m (31 March 2015: $13.5m)

·      Term Debt of $94.0m (31 March 2015: $109.0m). The Company is compliant of all applicable financial covenants including on-time payments of loan instalments and interest.

(1)   Non-recurring expenses relate to one off costs of US$ 0.3mn for professional charges.

Operational Highlights

·      Focus on profitable growth

o  Delivered 40% improvement to operating profit ($13.7m H1 2016, $9.8m H1 2015.)

·      Implementation of further best practices and leaner processes throughout the Content services division

o  Ensured return to profit in the division, with improved segment operating margin (16.8% H1 2016, -6.7% H1 2015)

·      Decline in aggregate revenue in project-driven content services, as expected ($39.7m H1 2016, $45.1m H1 2015)

o  Successful completion of a digital solutions project, including digitization of a sophisticated online library, impacted revenue by $3.3m

o  Reduction in financial publishing, in line with reduced workflow, reduced revenues by $2.1m

·      Sustainable long term growth prospects for content services division

o  World economy's irreversible shift to the digital sphere

o  iEnergizer provides cutting edge technology for clients

·      Confident outlook of returning to the previous growth trajectory in FY 2017

o  High level of customer demand for social engagement and digital products, particularly in the focused verticals of education and professional publishing, and enterprise learning and development.

·      Real Time Processing ("RTP"): Continued strong revenue growth, of 10.4%

·      Back Office Services: Tough comparable period in Back Office Services ("BOS") due to a one-off project

o  Expectation to resume growth momentum in this division

·      Focused cost saving initiatives increased EBITDA and operating profit margins:

o  Running a leaner organization using technology effectively and optimising utilization of the Company's resources

o  Consolidation of the content services division into the Company's low cost effective operations centre in Noida, India

o  Rationalizing SG&A costs including leveraging the Company's US based sales team for generating sales pipeline and cross-selling opportunities for all the business verticals of the Group.

·      Continued  focus  on  recurring  revenue  streams  from  business  critical  processes  and  long  term customer relationships

Marc Vassanelli, Chairman of iEnergizer, commented:

"Following the management actions to consolidate our operations in the prior year, we are pleased with the performance in the first half of this financial year, demonstrated by the better operating margins achieved.

"The Company's healthy cash position, together with its cash generative business model, puts the Company in a strong position to invest in both organic and inorganic growth opportunities.

"We expect current trends to continue with full year revenues in line with last year and an improvement in underlying operating margins. We believe there is significant opportunity for us to continue to expand the business further using this approach."

-Ends-

Enquiries: 

iEnergizer Ltd. Chris de Putron Mark De La Rue	[phone]
FTI Consulting - Communications adviser Edward Westropp, Jonathon Brill, Eleanor Purdon	[phone]
Arden Partners-Nominated adviser and broker Steve Douglas, Patrick Caulfield	[phone]

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 2015 and 2014

Unaudited Condensed Consolidated Statements of Financial Position

(All amounts in United States Dollars, unless otherwise stated)

	Notes		As at				As  at
			30 September 2015				31 March 2015
			Unaudited				Audited
ASSETS
Non-current
Goodwill	5		102,262,683			102,270,059
Other intangible assets	6		21,669,432			23,128,832
Property, plant and equipment	7		6,158,458			7,010,891
Long- term financial asset			586,984			711,788
Deferred tax asset			12,384,278			12,560,373
Non-current assets			143,061,835			145,681,943
Current
Trade and other receivables			26,604,781			22,646,535
Cash and cash equivalents			7,746,462			13,447,099
Short- term financial assets	8		3,605,014			4,941,742
Current tax asset			1,541,723			1,288,348
Other current assets			2,308,239			1,646,115
Current assets			41,806,219			43,969,839
Total assets			184,868,054			189,651,782
EQUITY AND LIABILITIES
Equity
Share capital	9		3,776,175			3,195,334
Share compensation reserve			63,986			63,986
Additional paid in capital	9		15,451,809			11,009,480
Merger reserve			(1,049,386)			(1,049,386)
Retained earnings			55,686,469			47,894,372
Other components of equity			(10,201,330)			(7,830,475)
Total equity attributable to equity holders of the parent			63,727,723			53,283,311

	Notes		As at		As  at
			30 September 2015		31 March 2015
			Unaudited		Audited
Liabilities
Non-current
Long term borrowings			80,147,682		95,044,847
Employee benefit obligations			4,564,904		4,685,707
Other non-current liabilities			539,641		547,185
Deferred tax liability			3,173,844		3,743,192
Non-current liabilities			88,426,071		104,020,931
Current
Trade and other payables			9,643,961		9,151,102
Employee benefit obligations			984,666		1,012,248
Current tax liabilities			144,541		22,950
Current portion of long term borrowings			13,833,050		13,947,982
Other current liabilities			8,108,042		8,213,258
Current liabilities			32,714,260		32,347,540
Total equity and liabilities			184,868,054		189,651,782

(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)

	Notes		For the six months ended		For the six months ended
			30 September 2015		30 September 2014
			Unaudited		Unaudited
Revenue
Rendering of services			67,315,112		74,645,886
Other operating income			1,656,659		1,439,922
			68,971,771		76,085,808
Cost and expenses
Outsourced service cost			19,298,174		21,329,925
Employee benefits expense			27,550,087		32,581,211
Depreciation and amortisation			2,560,220		3,503,974
Other expenses			5,831,264		8,863,203
			55,239,745		66,278,313
Operating profit			13,732,026		9,807,495
Finance income			207,589		205,496
Finance cost			(4,654,556)		(5,228,210)
Profit before tax			9,285,059		4,784,781
Income tax expense			1,492,963		1,532,778
Profit for the year attributable to equity holders of the parent			7,792,096		3,252,003

Earnings per share	10
Basic		0.04		0.02
Diluted		0.04		0.02
Par value of each share in GBP		0.01		0.01

(The accompanying notes are an integral part of these Unaudited Condensed Consolidated Interim Financial Statements)

Unaudited Condensed Consolidated Statements of Other Comprehensive Income

(All amounts in United States Dollars, unless otherwise stated)

	For the six months ended 30 September 2015 Unaudited	For the six months ended 30 September 2014 Unaudited
Profit after tax for the year	7,792,096	3,252,003
Exchange differences on translating foreign operations	(2,370,855)	(1,723,889)
Total comprehensive income attributable to equity holders	5,421,241	1,528,114

(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 2014 (Restated)	3,195,334	11,009,480	63,986	(1,049,386)	(5,603,252)	(135,004)	42,285,625	49,766,783
Profit for the year	-	-	-	-	-	-	5,608,747	5,608,747
Other comprehensive income	-	-	-	-	(2,260,100)	167,881	-	(2,092,219)
Total comprehensive income for the period	-	-	-	-	(2,260,100)	167,881	5,608,747	3,516,529
Balance as at 31 March 2015	3,195,334	11,009,480	63,986	(1,049,386)	(7,863,352)	32,877	47,894,372	53,283,311

Unaudited Condensed Consolidated Statements of Changes in Equity

	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 2015	3,195,334	11,009,480	63,986	(1,049,386)	(7,863,352)	32,877	47,894,372	53,283,311
Issue of ordinary shares	580,841	4,442,329	-	-	-	-	-	5,023,170
Transaction with owners	3,776,175	15,451,809	63,986	(1,049,386)	(7,863,352)	32,877	47,894,372	58,306,481
Profit for the year	-	-	-	-	-	-	7,792,096	7,792,096
Other comprehensive income	-	-	-	-	(2,370,855)	-	-	(2,370,855)
Total comprehensive income for the period	-	-	-	-	(2,370,855)	-	7,792,096	5,421,241
Balance as at 30 September 2015	3,776,175	15,451,809	63,986	(1,049,386)	(10,234,207)	32,877	55,686,468	63,727,722

 (All amounts in United States Dollars, unless otherwise stated)

 (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 2015		30 September 2014
(A) Cash flow from operating activities
Profit before tax			9,285,059	4,784,781
Adjustments
Depreciation and amortisation			2,560,220	3,503,974
(Profit)/loss on disposal of property, plant and equipment			(21,059)	34,430
Trade receivables written-off			-	40,207
Amortization of loan processing fee			516,785	552,552
Unrealised foreign exchange gain			(688,980)	(663,665)
Finance income			(207,589)	(205,496)
Finance cost			4,137,771	5,228,210
			15,582,207	13,274,993
Changes in operating assets and liabilities
(Increase)/decrease in trade and other receivables			(5,636,382)	9,285,305
Decrease/(increase) in other assets (current and non-current)			1,130,129	(126,995)
Increase/(decrease) in non-current liabilities, trade payables and other current liabilities			654,808	(1,667,882)
(Decrease)/increase in employee benefit obligations			(248,118)	300,091
Cash generated from operations			11,482,644	21,065,512
Income taxes paid			(2,018,000)	(2,073,882)
Net cash generated from operating activities			9,464,644	18,991,630
(B) Cash flow from investing activities
Payments for purchase of property plant and equipment			(410,210)	(2,420,969)
Proceeds from disposal of property, plant & equipment			26,328	-
Payments for purchase of other intangible assets			(201,221)	(355,523)
Interest received			172,258	167,592
Net cash used in investing activities			(412,845)	(2,608,900)
(C ) Cash flow from financing activities Issue of share capital			5,023,170	-
Interest paid			(4,137,771)	(5,782,542)
Repayment of long-term borrowings			(15,528,882)	(8,265,753)
Net cash used in financing activities			(14,643,483)	(14,600,847)
Net decrease/(increase) in cash and cash equivalents			(5,591,684)	1,781,883
Cash and cash equivalents at the beginning of the period			13,447,099	12,513,110
Effect of exchange rate changes on cash			(108,953)	(94,998)
Cash and cash equivalents at the end of the period			7,746,462	14,199,995
Cash and cash equivalents comprise
Cash in hand			13,713	916,714
Balances with banks in current account Balance with banks in deposit account			7,425,391 307,358	13,283,281 -
			7,746,462	14,199,995

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 pursuant to the Act of Royal Court of the Island of Guernsey.

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 Group FZ - LLC, iEnergizer IT Services Private Limited, iEnergizer Management Services Limited, iEnergizer BPO Limited, iEnergizer Aptara Limited and Aptara Inc and subsidiaries. (together the 'Group') is engaged in the business of call centre operations, providing business process outsourcing (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 2015 and 2014. 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 2015 and 2014.

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 2015.

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 2015 and 2014.

Standards issued but not yet effective

·      IFRS 9 Financial instruments

In July 2014, the International Accounting Standards Board issued the final version of IFRS9, Financial Instruments. The standard reduces the complexity of the current rules on financial instruments as mandated in IAS 39. IFRS 9 has fewer classification and measurement categories as compared to IAS 39 and has eliminated the categories of held to maturity, available for sale and loans and receivables. Further it eliminates the rule-based requirement of segregating embedded derivatives and tainting rules pertaining to held to maturity investments. For an investment in an equity instrument which is not held for trading, IFRS 9 permits an irrevocable election, on initial recognition, on an individual share - by-share basis, to presentable fair value changes from the investment in other comprehensive income. No amount recognized in other comprehensive income would ever be reclassified to profit or loss. It requires the entity, which chooses to measure a liability at fair value, to present the portion of the fair value change attributable to the entity's own credit risk in the other comprehensive income.

IFRS 9 replaces the 'incurred loss model' in IAS 39 with an 'expected credit loss' model. The measurement uses a dual measurement approach, under which the loss allowance is measured as either 12 month expected credit losses or lifetime expected credit losses. The standard also introduces new presentation and disclosure requirements.

The effective date for adoption of IFRS 9 is annual periods beginning on or after January 1, 2018, though early adoption is permitted. The Group is currently evaluating the requirements of IFRS 9 and the impact on the consolidated financial statements.

·      IFRS 15 Revenue from Contract with Customers

In May 2014, the International Accounting Standards Board (IASB) issued IFRS 15, Revenue from Contract with Customers. The core principle of the new standard is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. Further the new standard requires enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity's contracts with customers. The standard permits the use of either the retrospective or cumulative effect transition method. The effective date for adoption of IFRS 15 is annual periods beginning on or after January 1, 2017, though early adoption is permitted.

In September 2015, the IASB issued an amendment to IFRS 15, deferring the adoption of the standard to periods beginning on or after January 1, 2018 instead of January 1, 2017. The Group is currently evaluating the impact of this new standard on the Group's consolidated financial statements.

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 2015.

5.   GOODWILL

The net carrying amount of goodwill can be analysed as follows:

Particulars	Amount
Balance as at 01 April 2014	102,276,420
Translation adjustment	(6,361)
Balance as at 31 March 2015	102,270,059

Particulars	Amount
Balance as at 01 April 2015	102,270,059
Translation adjustment	(7,376)
Balance as at 30 September 2015	102,262,683

6.   OTHER INTANGIBLE ASSETS

The Intangible assets comprise of computer software, customer contracts.

Particulars	Customer contracts*	Computer softwares	Patent	Trade mark	Intangibles under development	Total
Cost
Balance as at 01 April 2014	24,134,910	2,235,563	100,000	12,000,000	132,490	38,602,963
Additions	-	413,124	-	-	-	413,124
Disposals	-	(23,032)	-	-	-	(23,032)
Translation adjustment	(7,114)	(109,406)	-	-	-	(116,520)
Balance as at 31 March 2015	24,127,796	2,516,249	100,000	12,000,000	132,490	38,876,535
Accumulated amortization
Balance as at 01 April 2014	9,497,709	1,643,409	-	-	-	11,141,118
Amortisation/ impairment for the period	3,982,805	607,340	-	-	132,490	4,722,635
Disposals	-	(23,008)	-	-	-	(23,008)
Translation adjustment	(7,114)	(85,928)	-	-	-	(93,042)
Balance as at 31 March 2015	13,473,400	2,141,813	-	-	132,490	15,747,703
Carrying values as at 31 March 2015	10,654,396	374,436	100,000	12,000,000	-	23,128,832

*Customer contracts are basically intangible assets created for long standing customer relationships in content delivery segment. The relationships are in existence from last many years and continuing. Once the relationship is established the work continues to flow on a year to year basis. The carrying amount of such contracts is USD 10,654,396 and remaining amortisation period is 4.8 years.

Particulars	Customer contracts*	Computer softwares	Patent	Trade mark	Intangibles under development	Total
Cost
Balance as at 01 April 2015	24,127,796	2,516,249	100,000	12,000,000	132,490	38,876,535
Additions	-	200,723	-	-	-	200,723
Translation adjustment	(8,251)	(137,711)	-	-	-	(145,962)
Balance as at 30 September 2015	24,119,545	2,579,261	100,000	12,000,000	132,490	38,931,296
Accumulated amortization
Balance as at 01 April 2015	13,473,400	2,141,813	-	-	132,490	15,747,703
Amortisation for the period	1,389,708	253,748	-	-	-	1,643,456
Translation adjustment	(8,251)	(121,044)	-	-	-	(129,295)
Balance as at 30 September 2015	14,854,857	2,274,517	-	-	132,490	17,261,864
Carrying values as at 30 September 2015	9,264,688	304,744	100,000	12,000,000	-	21,669,432

*Customer contracts are basically intangible assets created for long standing customer relationships in content delivery segment. The relationships are in existence from last many years and continuing. Once the relationship is established the work continues to flow on a year to year basis. The carrying amount of such contracts is USD 9,264,688 and remaining amortisation period is 4.3 years. 

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 2014	4,048,971	268,628	706,246	164,008	31,463	1,401,609	1,114,433	1,821,205	9,556,563
Additions	653,689	546,884	500,287	25,220	-	3,472,832	696,873	1,672,176	7,567,961
Capitalisation from capital work in progress	-	-	-	-	-	-	-	(3,493,381)	(3,493,381)
Disposals	(24,307)	(24,231)	(66,938)	-	-	(362,941)	(32,485)	-	(510,902)
Translation adjustment	(149,956)	(31,144)	(35,856)	(7,316)	(744)	(156,974)	(45,417)	-	(427,407)
Balance as at 31 March 2015	4,528,397	760,137	1,103,739	181,912	30,719	4,354,526	1,733,404	-	12,692,834
Accumulated depreciation
Balance as at 01 April 2014	1,959,319	115,976	389,783	41,498	16,848	636,566	596,249	-	3,756,239
Depreciation for the year	1,178,757	179,050	223,377	53,773	4,569	511,649	233,859	-	2,385,034
Disposals	(20,212)	(13,333)	(63,661)	-	-	(128,932)	(25,992)	-	(252,130)
Translation adjustment	(69,805)	(17,084)	(21,602)	(3,154)	(604)	(67,820)	(27,131)	-	(207,200)
Balance as at 31 March 2015	3,048,059	264,609	527,897	92,117	20,813	951,463	776,985	-	5,681,943
Carrying values as at 31 March 2015	1,480,338	495,528	575,842	89,795	9,906	3,403,063	956,419	-	7,010,891

Particulars	Computer and data equipment	Office Equipment	Furniture and fixtures	Air conditioner and generator	Vehicle	Leasehold improvements	Plant and machinery	Total
Cost
Balance as at 01 April 2015	4,528,397	760,137	1,103,739	181,912	30,719	4,354,526	1,733,404	12,692,834
Additions	209,463	9,051	83,273	45,520	-	78,912	588	426,807
Disposals (Net)	(160,480)	(864)	-	-	-	-	(5,347)	(166,691)
Translation adjustment	(1,105,635)	(78,049)	(171,251)	(10,772)	(864)	(347,077)	(84,442)	(1,798,090)
Balance as at 30 September 2015	3,471,745	690,275	1,015,761	216,660	29,855	4,086,361	1,644,203	11,154,860
Accumulated depreciation
Balance as at 01 April 2015	3,048,059	264,609	527,897	92,117	20,813	951,463	776,985	5,681,943
Depreciation for the year	387,828	62,118	35,023	17,006	2,266	276,523	136,000	916,764
Disposals (Net)	(155,215)	(860)	-	-	-	-	(5,347)	(161,422)
Translation adjustment	(1095,150)	(36,481)	(103,059)	(5,550)	(735)	(150,918)	(48,990)	(1,440,883)
Balance as at 30 September 2015	2,185,522	289,386	459,861	103,573	22,344	1,077,068	858,648	4,996,402
Carrying values as at 30 September 2015	1,286,223	400,889	555,900	113,087	7,511	3,009,293	785,555	6,158,458

8.   SHORT TERM FINANCIAL ASSETS

Particulars	30 September 2015	31 March 2015
Security deposits	124,756	171,610
Restricted cash	2,813,900	2,928,406
Short term investments (fixed deposits with maturity less than 12 months)	655,836	1,833,141
Due from officers and employees	10,522	7,983
Others	-	602
	3,605,014	4,941,742

Short term investments comprise of investment through banks in deposits denominated in various currency units bearing fixed rate of interest.

9.   ISSUE OF SHARE CAPITAL

The Company had executed a Term Loan B facility for a six year senior secured term loan facility ("the Facility") for an aggregate amount of US$135 million in 2013. Considering the audited results of the Company for the financial year ended 31 March 2015, which were announced on 2 July 2015, the Company required cash injection in order to comply with the terms of the Facility.

Accordingly, the Company has issued 15,120,000 and 22,000,008 new ordinary shares on 7 July 2015 and 17 July 2015 respectively of 1 Pence each to EICR Cyprus Limited ("EICR") for US$ 5,023,169. Following the Placing the Company will have 190,130,008 ordinary shares in issue.

Subsequently, the Company repaid US$3,300,000 towards the principal payment of Facility during July 2015 and further US$4,700,000 during August 2015.

10.  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 2015 is as follows:

Basic earnings per share

Particulars		30 September 2015	30 September 2014
Profit attributable to shareholders		7,792,096	3,252,003
Weighted average numbers shares outstanding		190,130,008	152,402,494
Basic earnings per share (USD)		0.04	0.02

Diluted earnings per share

Particulars		30 September 2015	30 September 2014
Profit attributable to shareholders		7,792,096	3,252,003
Potential ordinary shares*		-	107,508
Weighted average numbers shares outstanding		190,130,008	152,510,002
Diluted earnings  per share (USD)		0.04	0.02

* Shares to be issued under share options granted. These are anti-dilutive in nature and hence, not considered for the calculation of potential ordinary shares.

11.  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 Agarwal
II. Entities directly or indirectly through one or more intermediaries, control, are controlled by, or are under common control with, the reported enterprises	EICR Limited (Parent of iEnergizer Limited) Barker Shoes Limited (Under common control)
III. Key management personnel ("KMP") and significant shareholders	Mr. Anil Agarwal (Ultimate Shareholder, EICR Limited)
	Mr. John Behar, (Director, iEnergizer Limited) - up to 30 April 2014
	Ms. Sara Latham, (Director, iEnergizer Limited) - up to 16 September 2015
	Mr. Chris De Putron (Director, iEnergizer Limited) Mr. Mark De La Rue (Director, iEnergizer Limited) Mr. Marc Vassanelli (Director, iEnergizer Limited) - w.e.f 27 January 2014 Mr. Neil Campling (Director, iEnergizer Limited)- w.e.f. 1 April 2014 and up to 1 July 2015

Disclosure of transactions between the Group and related parties and the outstanding balances is as under:

Transactions with parent company

Particulars	30 September 2015	30 September 2014
Transactions during the period ended
Share issued to EICR Limited	5,023,170	-

Transactions with KMP and relative of KMP

Particulars	30 September 2015	30 September 2014
Transactions during the period ended
Short term employee benefits
Remuneration paid to directors
Sara Latham	19,114	24,953
Neil Campling	114,736	-
Chris De Putron	7,721	8,297
Mark De La Rue	7,721	8,297
Marc Vassanelli	23,102	24,684
Excess remuneration paid to directors written back
John Behar	-	(4,160)
Balances at the end of
Total remuneration payable	19,233	20,191

12.  SEGMENT REPORTING

Management currently identifies the Group's three services lines real time processing, back office services and content delivery as operating segments on the basis of operations. These operating segments are monitored and strategic decisions are made on the basis of adjusted segment operating 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.   Real time processing

2.   Back office services

3.   Content delivery

4.   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 2015
	Real time processing	Back office services	Content delivery	Others	Total
Revenue
Revenue from external customers	10,246,421	18,996,395	38,072,296	-	67,315,112
Other operating Income	46,150	-	1,610,509	-	1,656,659
Segment revenue	10,292,571	18,996,395	39,682,805	-	68,971,771
Cost of outsourced Services	-	12,362,198	6,935,976	-	19,298,174
Employee benefit expense	7,820,436	4,500	19,725,151	-	27,550,087
Depreciation and amortisation	296,041	-	2,264,179	-	2,560,220
Other expenses	695,830	185,450	4,366,249	583,735	5,831,264
Segment operating profit	1,480,264	6,444,247	6,391,250	(583,735)	13,732,026
Segment assets	10,792,135	12,236,900	84,881,222	76,957,797	184,868,054

				30 September 2014
	Real time processing	Back office services	Content delivery	Others	Total
Revenue
Revenue from external customers	9,317,504	21,633,679	43,694,703	-	74,645,886
Other operating Income	2,103	-	1,437,819	-	1,439,922
Segment revenue	9,319,607	21,633,679	45,132,522	-	76,085,808
Cost of outsourced Services	-	9,840,417	11,489,508	-	21,329,925
Employee benefit expense	6,415,588	4,571	26,083,647	77,405	32,581,211
Depreciation and amortisation	394,863	-	3,109,111	-	3,503,974
Other expenses	675,531	344,665	7,376,184	466,825	8,863,205
Segment operating profit	1,833,625	11,444,026	(2,925,928)	(544,230)	9,807,493
Segment assets	9,527,690	14,172,838	99,053,342	76,801,648	199,555,518

Revenue from the following customer's amounts to more than 10% of consolidated revenue during the period presented.

	30 September 2015
Revenue from	Segment	Amount
Customer 1	Real time processing	7,388,931

	30 September 2014
Revenue from	Segment	Amount
Customer 1	Content delivery	6,630,868
Customer 2	Real time processing	5,887,537

13.  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 2015	31 March 2015
Non-current assets
Loans and receivables
Security deposits	552,992	627,000
Restricted cash	33,992	84,788
Current assets
Loans and receivables
Trade receivables	26,604,781	22,646,535
Cash and cash equivalents	7,746,462	13,447,099
Restricted cash	2,813,900	2,928,406
Security deposits	124,756	171,610
Short term investments	655,836	1,833,141
Other current assets	10,522	7,983
Other short term financial assets	-	602
	38,543,241	41,747,164
Financial liabilities	30 September 2015	31 March 2015
Non-current liabilities
Financial liabilities measured at amortized cost:
Long term borrowings	80,147,682	95,044,847
Current liabilities
Financial liabilities measured at amortized cost:
Trade payables	9,643,961	9,151,102
Current portion of long term borrowings	13,833,050	13,947,982
Other current liabilities	5,156,868	4,119,324
Fair value through profit and loss:
Derivative financial instruments	464,195	88,275
	109,245,756	122,351,530

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.

14.  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 2015	Total	Fair value measurements at reporting date using
			Level 2
Liabilities	(Notional amount)
Derivative instruments
Forward contracts (currency - USD/INR)	25,040,000		(464,195)

31 March 2015	Total	Fair value measurements at reporting date using
			Level 2
Assets	(Notional amount)
Derivative instruments
Forward contracts (currency - USD/INR)	29,600,000		88,275

15.  COMMITMENT AND CONTINGENCIES

As at 30 September 2015 and 31 March 2015, the Group had a capital commitment of USD 54,237 and USD 96,671 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 USD 72,986 and USD 74,869 as on 30 September 2015 and 31 March 2015 respectively and in respect of interest on VAT amounts to USD 10,557 as on 30 September 2015 (USD 11,166 as on 31 March 2015).

Guarantees: As at 30 September 2015 and 31 March 2015, guarantees provided by banks on behalf of the group companies to the revenue authorities and certain other agencies, amount to approximately USD  119,615 and USD 126,516 respectively.

16.  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 2015 and 2014.

17.  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 2015 and 2014.

 

END

 

 

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