Teliti International Ltd Update on Datacentre and Trading (7906N)

TIDMTEL

RNS Number : 7906N

Teliti International Ltd

03 October 2012

3 October 2012

Teliti International Ltd.

("Teliti" or the "Company")

Update on Datacentre and Trading

Teliti International Ltd (AIM: TEL), the datacentre and IT business, provides an update on trading for the second half of the year ending 30 September 2012 and on the construction of its new, state-of-the-art datacentre.

Review of Trading for 2012

In its Interim Results announced on 29 June 2012, the Company referred to a strong outlook for Teliti Services with over RM40m of contracted revenues, which were expected to be invoiced in the second half of the year. However, only RM14.9m was billed during this period. The majority of the shortfall arose from a delay in billing for support and maintenance contracts, which the Company had expected to be able to bill in advance and which will now be billed on a monthly basis. The majority of this work will be conducted over the next 12 months. Part of the shortfall arose from a delay in billing on a contract with the Accountant General, which is waiting for the client to approve the report for August and September 2012, and is expected to be invoiced in the new financial year. In addition, one customer cancelled a project worth RM6.1m.

Teliti Solutions experienced similar issues, with a two-month postponement in delivering services on a major contract as well as the aforementioned delay with the Accountant General resulting in a shortfall in sales of RM8m, being approximately 30 per cent. below expectations at the time of the Interim Results. As a result, consolidated full year revenues are now expected to be approximately RM58m and pre-tax profits to be around RM2.9m.

Teliti Datacentres

In June 2012, Teliti announced that issues with its banking facility had delayed the construction of the datacentre as payments to the contractor had been delayed. Teliti's major shareholder, Teliti Computers, has agreed to provide additional security to the bank, which is now releasing the required funds to the contractor. The new, state-of-the-art datacentre is now expected to be completed and handed over to Teliti by mid-December 2012.

Following completion of the building in December 2012, Teliti will commence installing the IT hardware and commissioning the datacentre. Installation, testing and commissioning are expected to take three months with the datacentre becoming fully operational by Q2 2013. Interest in the facility remains strong and the Company expects to achieve its target of having 45,000 sq ft leased within the first 12 months of operation. However, the Company expects that orders will only be signed a month ahead of the site becoming operational.

Outlook

Whilst 2012 has been a disappointing year for the Company, it remains profitable, with a strong balance sheet and positive operational cash flows, and the outlook for the new financial year contains strong grounds for optimism. The government elections are expected to be held in November, bringing an end to current uncertainty; the Company starts the year with over RM41m of contracted revenues; and, most importantly, the datacentre is expected to commence operations in 2013.

Enquiries

 
 Teliti International Ltd 
 Hj Mohamed Nasir Abdul Majid, Chief 
  Executive Officer 
  Rosmida Din, Chief Financial Officer    [phone] 
 
 Daniel Stewart and Company plc 
 Antony Legge, James Felix                [phone] 
 
 Luther Pendragon 
 Harry Chathli, Claire Norbury            [phone] 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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