Consolidated segment results

for the year ended 31 July 2019

The reportable segments of the Group have been identified based on the nature of the business activities. A significant amount of time has been spent refining and revising the strategy of EOH. A major focus included the critical analysis of the portfolio; both in terms of refining the Group's focus and clarifying drivers of value over the longer term. This resulted in a more streamlined business, comprising three major segments with clearer alignment of focus and groupings of value. This basis is representative of the internal structure of the Group for management purposes. The Chief Operating Decision Maker ('CODM') is EXCO.

iOCO consists of the Information and Communications Technology (ICT) operations in South Africa and internationally. NEXTEC consists of Industrial Technologies and Business Process Outsourcing.

IP comprises businesses which have developed proprietary software and solutions for customers.

The CODM is not presented with secondary information in the form of geographic information and as a result, is not disclosed in the segment results. Liabilities and assets are also not regularly provided to the CODM and are not disclosed in the segment report.

Revenue and normalised EBITDA from continuing operations:

	2019
	iOCO	NEXTEC	IP	Recon- ciliation^	Total
Revenue
Revenue	6 931 563	7 142 522	1 714 984	(415 670)	15 373 399
Discontinued operations	659 027	2 472 118	451 184	–	3 582 329
Continuing revenue	6 272 536	4 670 404	1 263 800	(415 670)	11 791 070
Gross profit
Gross profit	1 212 491	1 054 223	713 902	(49 218)	2 931 398
Discontinued operations	73 087	325 535	163 339	–	561 961
Continuing gross profit	1 139 404	728 688	550 563	(49 218)	2 369 437
Continuing gross profit (%)	18,2%	15,6%	43,6%	11,8%	20,1%
EBITDA**	224 899	(9 845)	249 959	(199 000)	266 013
Non-core business lines to be closed~	279 254	246 800	–	–	526 054
Normalised EBITDA	504 153	236 955	249 959	(199 000)	792 067
Normalised EBITDA (%)	8,0%	5,1%	19,8%	47,9%	6,7%

	Restated* 2018
	iOCO	NEXTEC	IP	Recon- ciliation^	Total
Revenue
Revenue	7 548 559	6 993 953	1 596 988	(268 153)	15 871 347
Discontinued operations	641 696	2 635 180	491 154	–	3 768 030
Continuing revenue	6 906 863	4 358 773	1 105 834	(268 153)	12 103 317
Gross profit
Gross profit	2 149 938	1 524 509	822 505	(2 946)	4 494 006
Discontinued operations	243 822	590 623	238 403	–	1 072 848
Continuing gross profit	1 906 116	933 886	584 102	(2 946)	3 421 158
Continuing gross profit (%)	27,6%	21,4%	52,8%	1,1%	28,3%
EBITDA**	269 632	109 811	258 655	(279 600)	358 498
Non-core business lines to be closed~	578 694	18 042	–	–	596 736
Normalised EBITDA	848 326	127 853	258 655	(279 600)	955 234
Normalised EBITDA (%)	12,3%	2,9%	23,4%	104,3%	7,9%

EBITDA reconciliation

	2019	Restated* 2018
Operating loss before interest and equity-accounted losses from continuing operations	(3 373 487)	(1 340 461)
Depreciation and amortisation	367 129	401 547
Share of equity-accounted (losses)/profits	(9 814)	(463)
Impairment losses	1 630 674	758 469
Loss on disposal of assets	173 974	–
Stock and Original Equipment Manufacturer write-offs	302 044	–
Lebashe – A shares (IFRS 2)	157 444	–
Provision for debtors	342 760	286 430
GCT provisions	289 587	124 356
Provision relating to non-compliance	183 488	208 002
Other once-off adjustments	202 214	(79 382)
EBITDA**	266 013	358 498
Non-core business lines to be closed~	526 054	596 736
Normalised EBITDA	792 067	955 234

*	Comparative figures previously reported have been amended to reflect continuing operations and segments prevailing for the year ended 31 July 2019, as well as correction of prior period errors
**	EBITDA is defined as continuing losses before interest, tax, depreciation, amortisation, impairments, gains or losses on disposal of businesses and equity-accounted investments, once-off cash and non-cash items and includes profit or loss from equity-accounted investments.
^	Reconciliation comprises internal transactions and head office expenses.
~	Non-core business lines to be closed reflect businesses identified to be shut down in that year and preceding years.