Total Client Services (TCS) has cautioned shareholders the effects of its business rescue plan have yet to be seen.
The financially-troubled listed company, which suspended its shares in December 2013, applied for business rescue on 20 December 2013. The business rescue plan was adopted on 19 May last year and developed by business rescue practitioner Piers Marsden.
Its announcement that it was entering business rescue, three days before it asked the bourse to suspend trade in its shares, saw its stock plummet 50%.
TCS has been battling declining revenue and net losses for some time, while it awaits the implementation of the controversial Administration Adjudication of Road Traffic Offences Act (Aarto) system, which it had expected would improve its prospects.
Its latest results, for the year to February - belatedly published in December - show its top-line dropped 37% to R28.3 million, and it increased its headline loss per share. Revenue declined on the back of the end of its Ekurhuleni contract to deliver an integrated traffic contravention management system.
Yet, TCS noted it had been able to cut costs, and won a few new contracts. It also had a product pipeline that it hoped would "play a significant role in the refocused TCS".
The listed company, which is contracted by municipalities to enforce compliance with traffic laws through traffic cameras and the administration of fines, last July received the Johannesburg Stock Exchange's approval to raise capital without asking shareholder approval, a move the company anticipated would narrow its losses.
In the year to February 2014, earnings before interest, tax, depreciation and amortisation declined to a loss of R11.1 million. Its pre-tax loss grew to R18 million, compared with R8.2 million a year previously, and its headline loss per share increased to a loss of 4.76c compared to a loss of 2.03c.
TCS was spun out of Labat and listed separately in April 2008.
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