TeleMasters Holdings Limited (JSE:TLM) News - Initial Trading Statement

TELEMASTERS HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
Registration number 2006/015734/06
Share code: TLM & ISIN Number: ZAE000093324
(“TeleMasters” or “the Company” or “the Group”)


INITIAL TRADING STATEMENT


In terms of paragraph 3.4(b)(i) of the Listings Requirements of the JSE Limited, listed companies
are required to publish a trading statement as soon as they become reasonably certain that
the financial results for the period to be reported on next will differ by at least 20% from those
of the previous corresponding period or from a profit forecast previously provided to the market
in relation to such period.

Shareholders are advised that a review by management of the financial results for the six-
month period ended 31 December 2021 has indicated that the loss per share (“LPS”) and
headline loss per share (“HLPS”) are expected to decrease by at least 1200% compared to the
LPS and HLPS of (0.11) cents for the six-month period ended 31 December 2020.

A further trading statement will be issued when there is a reasonable degree of certainty as to
the range of the LPS and HLPS which will be ultimately realised by the Company.

The Company’s operational performance during the period under review continued to be
impacted by a reduction in revenues earned from lower variable usage services incurred by
customers because of the ongoing ‘Work from Home’ environment associated with the COVID-
19 disaster regulations. The impact of lower usage was partly offset by growth in data revenue.
Management has taken various strategic and operational decisions to address this, including
an increase in its remote data storage, processing and distribution offerings through the
acquisition of the remaining 74% of ConexLink (Pty) Ltd (renamed Ultra Data Centre (Pty) Ltd
(“Ultra DC”) with effect from 1 April 2021 as well as an increased focus on cost controls, which
has resulted in an improvement in the gross profit margin and reduced operational costs.

Whilst the consolidation of Ultra DC for the full 6-month period has led to substantial increases
in finance costs and depreciation, the long lead times associated with the data centre
revenue cycle has meant that expected improvements in revenues have not yet been
realised. Management is, however, cautiously optimistic that the continued opening up of the
economy may result in a steady change in the rate at which business decisions are taken and
that the risk taken with the acquisition of a niche data centre provider in a stalled economy
may start yielding expected benefits associated therewith.

The financial information on which this trading statement is based has not been reviewed and
reported on by the Company’s auditors. It is anticipated that the financial results for the six
months ended 31 December 2021 will be published on or about 31 March 2022.

Waterfall City
28 February 2022

Designated Advisor
AcaciaCap Advisors Proprietary Limited

Date: 28-02-2022 02:01:00
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