SHAREHOLDERS of Productive Business Solutions Limited (PBS) might have to wait until the end of October before they can resume trading in the company’s shares, nearly four months after its July 2 suspension, with the company reporting it is still facing issues to complete its 2023 audited financials.

PBS’ 2023 audited financials were due on March 30, but the company delayed submission of its documents to the stock exchange without giving a reason. After a 90 day grace period to submit said financials expired with the company still failing to file the audited financials for last year, its ordinary and preference shares were suspended by the JSE on July 2. It was not until a month later that PBS finally updated the market saying its audited financials should be submitted on or before October 31, effectively seven months past the original due date.

“The further delay has been caused by additional audit procedures as a result of required restatements of material accounting transactions undertaken by PBS’s subsidiary in Costa Rica which we expect will mostly impact PBS’s consolidated financial statements in accounting periods prior to 2021,” the PBS disclosure stated.

The rationale for the restatement wasn’t explained. This has also pushed back the company’s annual report submission to November 15.

The company has more than 3,000 employees spread across more than 21 markets, with each of its subsidiary companies in these markets having to be audited as well to produce the company’s consolidated financials.

PBS is a distributor of printing equipment, business machines, handsets; distributor of software products for firms like Google, Xerox, Cisco and Microsoft and serves as a key partner in ATM (automated teller machine) and POS (point of sale) software maintenance.

PBS has been making several major moves over the last year. It acquired Infotrans Group Holding BV in Curacao during the second quarter of 2023. PBS also acquired a 45 per cent stake in Trinidad Systems Group Limited (TSL) for US$6.08 million for a valuation of US$13.51 million. PBS also completed the acquisitions of Xerox del Peru, SA and Xerox del Ecuador, SA on July 1 with the transaction details to be revealed in either Xerox Holdings Corporation 8-K or 10-Q disclosures at the end of October. The Xerox acquisitions were preceded by a US$126 million (JA$19.55-billion) syndicated loan with Citibank NA to refinance existing debts and enhance PBS’ liquidity profile.

“This partnership fosters growth and innovation for both companies. TSL remains committed to providing exceptional service to existing customers throughout this transition and we welcome our customers to reach out with any questions they have,” said Stuart Franco, chief executive officer of Trinidad Systems Limited (TSL), in a newspaper release.

Due to the suspension, PBS’ 9.75 per cent preference shares, which were set to be redeemed on July 31, haven’t been delisted as yet. While the company has not declared an ordinary dividend this year, the company has declared dividends on its preference shares. The 9.25 per cent preference shares will pay a US$346,875 preference share dividend which translates to US$0.23125 per share. The 10.50 per cent preference share will pay a J$12,945,205.48 which translates to J$25.8904 per share. This will be paid to investors on September 30 to owners on record as of September 4.

PBS’ unaudited second quarter (April to June) saw its revenue climb 39 per cent to US$102 million with its gross profit rising eight per cent to US$27.75 million. Its gross profit margins were compressed from 35.13 per cent to 27.21 per cent. Due to a rise in operational expenses, PBS’ operating profit declined seven per cent to US$6.58 million, but its EBITDA (earnings before interest, tax, depreciation and amortisation) was US$11.07 million. After accounting for higher taxes, PBS’ consolidated net profit dipped 27 per cent to US$1.92 million with net profit attributable to shareholders of US$1.89 million.

For the overall half year, revenue was up four per cent to US$167.90 million with gross profit of US$51.14 million. Operating profit shrunk 17 per cent to US$10.75 million with consolidated net profit decreasing 44 per cent to US$2.46 million and net profit attributable to shareholders of US$2.36 million.

Total assets at the end of June were US$399.19 million with intangible assets of US$101.62 million and trade receivables of US$101.61 million being the bulk of the group’s assets. Total liabilities and equity attributable to shareholders were US$300.71 million and US$97.32 million, respectively.

“PBS is well-positioned to achieve its financial and strategic goals for the year. We are witnessing the highest level of demand for our products and services in our history. The demand is broad-based and spans most of our markets, product categories and customer segments reflecting the long-term enduring trend of increased information technology investment in our region. PBS’ strong pipeline aligns closely with our full-year 2024 expectations of continued growth in our revenue and profitability,” stated the PBS report signed by the chairman and CEO.