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BLUE LABEL INTEGRATED ANNUAL REPORT 2015
DIRECTORS’ REPORT
The Directors have pleasure in presenting the Group and Company annual financial statements of Blue Label
Telecoms Limited (Blue Label Telecoms or the Company) and its subsidiary, associate and joint venture
companies (the Group) for the year ended 31 May 2015.
PRINCIPAL ACTIVITIES AND STRATEGY
Blue Label Telecoms’ core business is the virtual distribution of secure electronic tokens of value and
transactional services across its global footprint of touch points. The Group’s stated strategy is to extend its
global footprint of touch points, both organically and acquisitively, to meet the significant demand for the
delivery of multiple prepaid products and services through a single distributor, across various delivery
mechanisms and via numerous merchants or vendors.
FINANCIAL RESULTS
The Group recorded a net profit after tax attributable to equity holders for the year ended 31 May 2015 of
R578 million (2014: R450 million). Full details of the financial position and results of the Company, the Group
and its segments are set out in the annual financial statements and Group annual financial statements. The
Group and Company annual financial statements for the year ended 31 May 2015 were approved by the Board
and signed on its behalf on 18 August 2015.
GOING CONCERN
The financial statements have been prepared on the going concern basis, since the Directors have every reason
to believe that the Blue Label Telecoms Group and the Company have adequate resources in place to continue
in operation for the foreseeable future.
ACQUISITIONS
In September 2014 Blue Label Telecoms Limited purchased 75% of Viamedia Proprietary Limited (Viamedia).
The purchase consideration was for an initial sum of R144.4 million plus additional amounts totalling up to
R103.1 million if warranted profits are achieved by Viamedia. If the warranted profits are not achieved, the
above additional payments will be abated on a pro-rata basis. A further R112.5 million or part thereof will be
payable if stretched targets over and above the warranted accumulated profits are achieved. Refer to note 26
of the Group annual financial statements for further information.
In March 2015 Viamedia Proprietary Limited purchased 50% of Supa Pesa Africa (Mauritius) Limited for
R0.1 million plus an additional amount of R29.5 million if certain profit warranties are achieved. A further
R8 million will be payable if stretched targets over and above the warranted accumulated profits are achieved.
Refer to note 6 of the Group annual financial statements for further information.
In September 2014 Blue Label Telecoms Limited advanced a further R49 million to Blue Label Mexico S.A.
de C.V.. This amount was capitalised resulting in the Group’s shareholding in Blue Label Mexico S.A. de C.V.
increasing to 46.64%. Refer to note 6 of the Group annual financial statements for further information.
DISPOSAL
In April 2015 Gold Label Investments Proprietary Limited disposed of its interest in Smart Voucher Limited
trading as Ukash for an initial sum of R94.9 million plus additional amounts totalling R17.5 million if certain
warranties are achieved. Refer to note 6 of the Group annual financial statements for further information.
SHARE CAPITAL
Full details of the authorised, issued and unissued capital of the Company at 31 May 2015 are contained in
note 13 of the Group annual financial statements. There were no shares issued during the financial year ended
31 May 2015 (2014: nil).
SUBSEQUENT EVENTS
Subsequent to year-end, dividend number 6 was declared and approved by the Board.