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Arivia.kom on target with maiden results


Johannesburg, 11 Jul 2002

New IT giant arivia.kom ended its first financial year of operation on target and has bigger aspirations for the coming year.

[VIDEO]In releasing the company`s maiden results for the 15 months to March 2002 today, CEO Zeth Malele said the group had achieved revenue of R1.51 billion and earnings before interest, tax, depreciation and amortisation (EBITDA) of R159.1 million. Net income after tax was R31.25 million.

Describing the results as highly commendable, Malele said they had been achieved in the face of an IT market slump and scepticism towards new ventures.

Arivia.kom was formed in January 2001 with the consolidation of Eskom ITS, Datavia and Ariel Technologies to provide integrated business solutions and include the spectrum of IT services. It is a State-owned entity.

<B>Salient figures</B>

Arivia.kom results for the 15 months to 31 March 2002:

Revenue: R1.51b
EBITDA: R159.07m
Income before tax: R23.24m
Net income after tax: R31.25m
Net income: R33.67m
Current assets: R382.41m
Current liabilities: R289.53m
Cash and equivalents: R47.29m
Net cash generated from operations: R112.48m

"We have completed one of the biggest consolidations of its kind in this country," he said. "Our business challenge was to create a compelling strategy and business model, and simultaneously meet our business targets and deliver shareholder value. We have achieved all this and also put in a superb performance. Our results are highly commendable considering the serious business, operational and financial challenges which we faced at the time of our formation."

Hugo Knoetze, arivia.kom`s CFO, said the group is on track to become a dominant player in the African ICT market within three to five years. "Our strategy includes focusing on opportunities created by the SA second national operator and the financial services sector, among others."

[VIDEO]Addressing arivia.kom shareholders this morning, public enterprises minister Jeff Radebe described arivia.kom`s success as a landmark event in the process of restructuring State-owned enterprises. "This year has given credence to the idea of the African Renaissance and confounded sceptics about anything from Africa. It is clear the world is also beginning to display confidence in the continent and its new vision, and this opportunity must be supported, among others, by sustainable information communication technologies, which arivia.kom is poised to offer."

Radebe said that when arivia.kom was launched last year, "we said it had the potential to become a significant player in the local, regional and global ICT market. This would enhance Nepad`s ICT infrastructure exploitations and initiatives such as the African SCAN-ICT and e-Readiness initiatives, the Electronic Governance and Government Initiative for Africa, and the African Electronic Commerce and Trade Initiative. The business opportunities presented by the developments within the continent and worldwide, if properly exploited, should enable arivia.kom to improve on its profits."

The results

With revenue of R1.51 billion and EBITDA at R159.1 million, the margin is 10.5%. The group turned a pre-formation combined loss into a R33.7 million net profit for the period under review. It generated a positive cash balance of R47.2 million after investing R55 million in new businesses and technology assets. Arivia.kom has also been awarded new business contracts in excess of R640 million.

Arivia.kom is organised into three operating divisions - infrastructure business, focused business solutions and niche markets. The revenue contributions are R1.079 million from infrastructure business (71.4%), R255 million from focused business solutions (16.9%) and R176 million from niche markets (11.7%).

The group has a significant asset base of R228.2 million, utilised in the delivery of services, the greater proportion of which is IT equipment acquired at its formation.

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