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Reviewed AYO interim results show dip in profit after tax

Jun 03 2019 22:51
Sibongile Khumalo

AYO Technology Solution says its interim financial statement for the year ended February 28 shows that profit after tax decreased, after the IT company was ordered by the JSE to conduct a review of its earnings.

The order, which the company described as "highly unusual" - followed evidence by former employees at the commission of inquiry into the Public Investment Corporation who testified that the company may have inflated its unaudited interim results. The inquiry is probing allegations of wrongdoing at the state-owned asset manager.

AYO at the time denied any wrongdoing. 

The IT group received a R4.3bn cash injection from the PIC when it listed on the JSE in December 2017. The state-owned fund manager has now served AYO with a summons, seeking the court to set aside the subscription agreement.

The company, linked to Sekunjalo executive chair Iqbal Survé, said the review report ordered by the JSE identified "certain corrections, which require the restatement of the 28 February 2018 interim results".

Sekunjalo holds a 30% stake in AYO via its subsidiary African Equity Empowerment Investments. 

"AYO can, however, confirm that profit before tax remains flat and that earnings per share and headline earnings per share, increased by approximately two percent," the group said in a statement issued on Monday evening.

"As a result of the re-computation of tax, however, profit after tax decreased."

The company further stated that it was confident that all material discrepancies between the published accounts and the restated version of the interim accounts would ensure a more than satisfactory level of accuracy of the financial position of AYO at February 28, 2018. 

"AYO has indicated to the JSE the steps it has taken, and will be taking, to ensure any potential breaches are dealt with."

The PIC’s investment in AYO has featured prominantly the PIC commission, with allegations that it misrepresented its value when it listed on the JSE, according to evidence heard by the inquiry. 

AYO, in turn, has also announced its intention to sue the PIC over the damage done to its reputation, in light of the comments made by PIC officials about the investment in the public domain.

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