| Tue 4 May 2010, 14:12 | | ADR - Adcorp Holdings Limited - Reviewed group results for the year ended 28 |
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ADR
ADR
ADR - Adcorp Holdings Limited - Reviewed group results for the year ended 28
February 2010
Adcorp Holdings Limited ("Adcorp" or "Adcorp Group" or "the Group")
Registration number 1974/001804/06
Share code: ADR ISIN number: ZAE000000139
Reviewed group results for the year ended 28 February 2010
Normalised EBITDA down by 14%
Normalised earnings per share down by 19%
Cash conversion ratio 92%
Balance sheet strengthened by R112,5 million capital raised
4 500 learnerships facilitated
Scrip distribution with a cash dividend election of 115 cents per share
Abridged statement of comprehensive income
for the year ended 28 February
Reviewed Audited
year ended year ended
28 February 28 February
2010 2009
R`000 R`000
Revenue 5 050 358 4 837 123
Cost of sales (3 953 341) (3 724 735)
Gross profit 1 097 017 1 112 388
Other income 39 353 32 695
Administrative expenses (346 123) (305 615)
Marketing and selling expenses (451 326) (451 956)
Other operating expenses (172 390) (160 910)
Operating profit 166 531 226 602
Interest received 12 859 19 782
Interest paid (62 127) (52 914)
Share of profits from associates - 18
Impairment of investments in associates and
goodwill (984) -
(Loss)/profit on sale of property and equipment
(389) 667
Profit before taxation 115 890 194 155
Taxation (11 574) (50 082)
Profit for the year 104 316 144 073
Other comprehensive income
Exchange differences on translating foreign
operations (752) 316
Fair value adjustment of derivative financial
instrument (863) (1 756)
Other comprehensive income for the year, net of
tax (1 615) (1 440)
Total comprehensive income for the year 102 701 142 633
Profit attributable to:
Owners of the parent 104 316 144 073
Total comprehensive income attributable to:
Owners of the parent 102 701 142 633
Earnings per share
Basic (cents) 193,5 272,8
Diluted (cents) 188,7 271,8
Distribution to shareholders
Interim dividend (cents) 50 62
Final dividend (cents) in respect of the prior
year 160 160
Calculation of headline earnings
Profit for the year 104 316 144 073
Profit/(loss) on sale of property and equipment
280 (480)
Impairment of investments in associates and
goodwill 984 -
Headline earnings 105 580 143 593
Headline earnings per share
Headline earnings per share - cents 195,9 271,9
Diluted headline earnings per share - cents
191,0 270,9
Weighted average number of shares - 000`s 53 903 52 808
Diluted weighted average number of shares - 000`s
55 272 53 000
Abridged statement of financial position
as at 28 February
Reviewed Audited
28 February 28 February
2010 2009
R`000 R`000
Assets
Non-current assets 801 608 845 422
Property and equipment 53 405 59 807
Goodwill 554 290 555 208
Intangible assets 179 334 209 087
Investment in associates - 100
Derivative financial instruments and other
financial assets 910 1 872
Deferred taxation 13 669 19 348
Current assets 870 188 868 178
Trade, other receivables and prepayments 717 047 685 943
Assets classified as held-for-sale 845 845
Taxation prepaid 14 703 330
Cash resources 137 593 181 060
Total assets 1 671 796 1 713 600
Equity and liabilities
Equity attributable to owners of the parent
907 943 803 902
Share capital 1 483 1 355
Share premium 497 968 384 594
Treasury shares (13 293) (592)
Retained earnings 422 488 418 496
Foreign currency translation reserve (1 124) (372)
BEE shareholders` interest 421 421
Non-current liabilities 212 502 249 670
Other non-current liabilities 5 034 2 700
Long-term loan 59 912 78 755
Redeemable preference shares 130 000 130 000
Obligation under finance lease 2 597 3 165
Deferred taxation 14 959 35 050
Current liabilities 551 351 660 028
Non-interest-bearing current liabilities 327 799 388 791
Trade and other payables 249 073 257 918
Amount due to vendor - 32 353
Provisions 77 850 83 737
Taxation 876 14 783
Interest-bearing current liabilities 223 552 271 237
Current portion of other non-current liabilities
2 124 3 138
Current portion of long-term loan 31 227 32 871
Current portion of redeemable preference shares
2 362 3 431
Bank overdraft 187 839 231 797
Total equity and liabilities 1 671 796 1 713 600
Number of ordinary shares in issue (000`s) 58 777 54 220
Net asset value per share (cents) 1 545 1 483
Total interest-bearing liabilities of the Group
Reviewed Audited
28 February 28 February
2010 2009
R`000 R`000
Net bank overdraft 50 246 50 737
Other non-current liabilities 5 034 2 700
Long-term loan 59 912 78 755
Redeemable preference share 130 000 130 000
Obligations under finance lease 2 597 3 165
Current portion of other non-current liabilities
2 124 3 138
Current portion of long-term loan 31 227 32 871
Current portion of redeemable preference shares
2 362 3 431
Total interest-bearing liabilities 283 502 304 797
Abridged statement of cash flows
for the year ended 28 February
Reviewed Audited
year ended year ended
28 February 28 February
2010 2009
R`000 R`000
OPERATING ACTIVITIES
Cash generated by operations before working 280 009 326 827
capital changes
Increase in working capital (55 253) (84 542)
Cash generated by operations 224 756 242 285
Net interest paid (46 621) (28 689)
Taxation paid (58 258) (50 713)
Free cash generated by operations 119 877 162 883
Net dividend paid (118 379) (126 638)
Cash inflows from operating activities 1 498 36 245
Investing and financing activities
Cash outflows from investing activities (81 901) (231 891)
Cash inflows from financing activities 80 894 195 414
Net increase/(decrease) in cash and cash
equivalents 491 (232)
Net cash and cash equivalents at the beginning of (50 737) (50 505)
the year
Net cash and cash equivalents at the end of the
year (50 246) (50 737)
Free cash generated by operations per share -
cents 222,4 308,4
Abridged statement of changes in equity
for the year ended 28 February
Foreign
currency
Share Share Treasury translation
capital premium shares reserve
R`000 R`000 R`000 R`000
Balance as at 1 March 2008 1 271 283 070 (701) (688)
Issue of ordinary shares under
employee share option plan 3 1 818 - -
Issue of ordinary shares for the
acquisition of subsidiaries
81 99 706 - -
Recognition of BBBEE and staff
share-based payments - - - -
Dividend distributions - - 109 -
Profit for the year - - - -
Other comprehensive income for the
year - - - 316
Balance as at 28 February 2009 1 355 384 594 (592) (372)
Issue of ordinary shares under
employee share option plan 3 999 - -
Buy-back of ordinary shares - - (12 822) -
Issue of shares under private
placement 125 112 375 - -
Treasury shares sold - - 31 -
Dividend distributions - - 90 -
Recognition of BBBEE and staff
share-based payments - - - -
Profit for the period - - - -
Other comprehensive income for the
period - - - (752)
Balance as at 28 February 2010 1 483 497 968 (13 293) (1 124)
BEE
shareholders Retained
interest earnings Total
R`000 R`000 R`000
Balance as at 1 March 2008 421 384 798 668 171
Issue of ordinary shares under
employee share option plan - - 1 821
Issue of ordinary shares for the
acquisition of subsidiaries - - 99 787
Recognition of BBBEE and staff
share-based payments - 18 316 18 316
Dividend distributions - (126 935) (126 826)
Profit for the year - 144 073 144 073
Other comprehensive income for the
year - (1 756) (1 440)
Balance as at 28 February 2009 421 418 496 803 902
Issue of ordinary shares under
employee share option plan - - 1 002
Buy-back of ordinary shares - - (12 822)
Issue of shares under private
placement - - 112 500
Treasury shares sold - - 31
Dividend distributions - (118 469) (118 379)
Recognition of BBBEE and staff
share-based payments - 19 008 19 008
Profit for the period - 104 316 104 316
Other comprehensive income for the
period - (863) (1 615)
Balance as at 28 February 2010 421 422 488 907 943
Abridged segment report
for the year ended 28 February
Revenue Internal revenue
Feb Feb Feb Feb
2010 2009 2010 2009
R`000 R`000 R`000 R`000
Central costs 238 - - -
Staffing 4 808 871 4 604 249 19 292 13 481
Business process outsourcing 241 249 232 874 - 1 497
TOTAL 5 050 358 4 837 123 19 292 14 978
EBITDA excluding
share based
payments and
Operating profit lease smoothing
Feb Feb Feb Feb
2010 2009 2010 2009
R`000 R`000 R`000 R`000
Central costs (29 621) (29 528) (23 030) (22 245)
Staffing 160 643 236 479 225 747 296 364
Business process outsourcing 35 509 19 651 77 032 52 777
TOTAL 166 531 226 602 279 749 326 896
EBITDA excluding
share based
EBITDA margin payments and lease
excluding share smoothing
based payments and contribution % to
lease smoothing Group EBITDA
Feb Feb Feb Feb
2010 2009 2010 2009
% % % %
Central costs 0,0% 0,0% (8,2%) (6,8%)
Staffing 4,7% 6,4% 80,7% 90,7%
Business process outsourcing 31,9% 22,7% 27,5% 16,1%
TOTAL 5,5% 6,8% 100,0% 100,0%
Net asset values Assets carrying value
Feb Feb Feb Feb
2010 2009 2010 2009
R`000 R`000 R`000 R`000
Central costs (161 253) (217 388) 11 696 8 092
Staffing 961 635 843 653 1 371 244 1 335 722
Business process
outsourcing 107 561 177 637 288 856 369 786
TOTAL 907 943 803 902 1 671 796 1 713 600
Liability Depreciation and Additions to
carrying amortisation of property and
value intangibles equipment
Feb Feb Feb Feb Feb Feb
2010 2009 2010 2009 2010 2009
R`000 R`000 R`000 R`000 R`000 R`000
Central costs 172 949 225 480 786 381 3 086 341
Staffing 409 609 492 069 56 204 51 697 14 077 16 557
Business process
outsourcing 181 295 192 149 38 204 29 526 5 949 10 664
TOTAL 763 853 909 698 95 194 81 604 23 112 27 562
Comments
Normalised earnings
Normalised earnings exclude the amortisation of intangibles arising on
business combinations as well as share based payments and lease smoothing
adjustments. The table below sets out the normalised earnings for the year
ended 28 February 2010 as well as the prior year comparative figures.
Year ended Year ended
28 February 28 February %
R`000 2010 2009 change
Revenue 5 050 358 4 837 123 4
Cost of Sales (3 953 341) (3 724 735) (6)
Gross Profit 1 097 017 1 112 388 (1)
Other income 39 353 32 695 20
Administrative marketing selling and
operating expenses (969 839) (918 481) (6)
Operating profit 166 531 226 602 (27)
Adjusted for:
Depreciation 26 423 25 522 (4)
Amortisation of intangible assets 68 771 56 082 (23)
Share-based payments 19 008 18 316 (4)
Lease smoothing (984) 374
EBITDA (excl. share based payments and
lease smoothing) 279 749 326 896 (14)
Adjusted for:
Depreciation (26 423) (25 522) (4)
Amortisation of intangibles other than
those acquired in a business
combination (9 598) (848)
Normalised operating profit 243 728 300 526 (19)
Net interest paid (46 622) (28 850) (62)
Profit before taxation 197 106 271 676 (27)
Taxation (27 158) (65 652) 59
Profit for the year 169 948 206 024 (18)
Normalised effective tax rate 14% 24%
Normalised earnings per share - cents
315,3 390,1 (19)
Diluted normalised earnings per share -
cents 307,5 388,7 (20)
Weighted average no of shares - 000`s
53 903 52 808
Diluted weighted average no of shares -
000`s 55 272 53 000
Overview
The financial year ended 28 February 2010 proved to be a particularly tough
year for the Adcorp Group. In the context of the severe recessionary
conditions that characterised the South African economy, trading results were,
however, generally satisfactory albeit lower than the earnings reported for
the prior year.
In this regard, normalised earnings for the year of 315,3 cents per share
(FY2009: 390,1 cents per share) were some 19% lower than the comparable
normalised earnings per share for the prior year.
Group revenue of R5 050 million reflected a 4% increase compared to revenues
of R4 837 million achieved in the prior year.
Whilst different reporting entities within the Group experienced the effects
of the recession in varying degrees, the dominant blue collar flexible
staffing businesses continued to perform well, vindicating the Group`s
decision in 2006 to significantly increase its exposure to this particular
sector of the market.
The shift of the Group`s exposure toward blue collar flexible staffing was in
response to the rapid growth that this sector was experiencing at the time
and, as such, the strategy was therefore predominantly offensive in nature.
The growth in exposure to this sector was effected by the acquisitions of
Capital Outsourcing Group ("COG") in 2007 and Staff-U-Need ("SUN") in 2008.
With the benefit of hindsight, this strategy has also proved to be robust and
defensive in nature. Both of these acquisitions have integrated well into the
Group and, together with legacy blue collar staffing business, Capacity, have
performed extremely well in difficult circumstances.
Also, in 2006, the decision was taken to increase the Group`s exposure to the
Business Process Outsourcing ("BPO") sector and, in this regard, the Group
acquired FMS Marketing Solutions ("FMS") in 2007. This has also proven to be a
good defensive play and, once again, delivered strong results for the Group.
Our training business, Production Management Institute of SA ("PMI"), also
made a strong contribution, particularly in the area of delivering
approximately 4 500 learnerships in terms of the Skills Development Act within
the Adcorp contract staffing compliment which, whilst adding an additional
cost burden, has resulted in benefits accruing to the Group in the form of tax
credits.
The white collar flexible staffing businesses as well as the permanent
recruitment businesses had an extremely difficult year. Volumes in the retail
banking sector, where typically business activities are high, proved to be
particularly vulnerable.
In response to the difficult trading conditions, certain cost cutting
initiatives were initiated which, whilst benefiting the Group in the longer
term, did result in a short term restructuring cost approximating R5,7
million.
Central costs were well controlled and showed a 3,5% increase year on year.
Reducing overall overhead and back office costs continues to remain a key
management focus area. In this regard, a number of efficiency projects have
been identified and the benefits are starting to be realised.
Following much negotiation, debate and political rhetoric regarding the role
of the temporary employment service ("TES") or "labour broking" industry over
the past year whereby certain elements within Government as well as trade
union federation, Cosatu, have been calling for an outright ban of the
industry, the Parliamentary Portfolio Committee on Labour recently announced
that there would be no ban but rather, proposed regulations to curtail
exploitative practices believed to exist within certain sectors of the
industry.
Already tabled at the Nedlac negotiations in this regard has been the concept
of a co-employment relationship between temporary employment service provider
and client which would imply joint and several liability for both the
temporary employment service provider as well as its client. As an
organisation, Adcorp is currently solely liable for any liability which may
arise as a result of the employment contract thus, such a change would have no
material impact on the Group. The effect would, however, be to afford the
contract worker greater security in the event of a default by a temporary
employment service provider.
One of the other principles that has been tabled is that of equal pay for work
of equal value. It is also not anticipated that this will have a marked impact
on the Group as there is already adherence to bargaining council agreements
across the Group where applicable.
In general, the Adcorp Group welcomes the proposed regulatory changes which
are similar in nature to what has been adopted in Europe. In that territory,
such regulations have tended to favour the larger, sophisticated players whose
respective market shares have generally increased following the enactment of
similar regulation. In addition, the case for intermediating contract workers
is strengthened which, it is believed, should also favour the Group. Adcorp
has taken an active role in the negotiations regarding the future of the
industry and will continue to push for responsible regulation.
The acquisition of SUN was concluded in August 2008 and, as such, has been
included in Group profits for the full financial year for the first time. The
business has a specific focus on providing skilled and semi-skilled workers to
the power generation and engineering industries. As such, it has become an
important contributor to the Group and it is anticipated that it will continue
to remain so into the future. The business has integrated well into the Adcorp
Group and is performing in line with expectations.
The implementation of the new Microsoft Dynamics AX ERP system has been
successful with the majority of Group companies having now gone live on the
system. The system will contribute positively to the quality, extent and
relevance of management information as well as to operating efficiencies.
A major focus of management is now to unlock the potential benefits the system
offers in terms of being able to streamline processes and systems as well as
in terms of accessing valuable management information.
During the year under review, an unfortunate internal employee dispute spilled
over into the media attracting much unwanted and unwarranted publicity and
attention. The matter was referred to private arbitration whereby the
arbitrator found overwhelmingly in favour of the company in terms of all
aspects of the matter and ordered that six employees, including the then Chief
Financial Officer, be summarily dismissed.
Whilst extremely disruptive by its very nature at the time, the matter was
successfully dealt with timeously, decisively and conclusively with due regard
to limiting reputational damage to the Adcorp Group as well as limiting
disruption to the day to day operations of the business. The Board commends
the Chief Executive Officer and management in the manner in which the mater
was dealt with.
Financial overview
Normalised EBITDA of R279,7 million for the year ended 28 February 2010 is 14%
below the R326,9 million for the comparative prior year primarily as a result
of the economic conditions discussed earlier in this commentary.
The Group`s normalised EBITDA margin was 5,5% as opposed to 6,8% in the prior
year. Margins were negatively affected by pricing pressure in the white collar
flexible staffing operations and by reduced scale in the permanent recruitment
businesses. The biggest impact on group margin was, however, a greater mix
swing in favour of the typically lower margin blue collar businesses. Also
impacting margins negatively were retrenchment, restructuring costs, foreign
exchange losses as well as the costs associated with delivering learnerships.
Cash management continues to remain a high priority for management. In this
regard, debtors` days outstanding totalled 38 days (FY2009: 35 days). This was
achieved despite an extremely difficult collections environment, particularly
with regard to the public sector where some significant balances remained
unpaid at year end. Subsequent to the balance sheet date a significant amount
approximating R62 million of the outstanding public sector debt has since been
collected.
The Group`s overall normalised effective tax rate has been significantly
reduced to 14% (FY2009: 24%) due to the tax benefits received arising from the
facilitation of the approximately
4 500 registered learnerships in compliance with the Skills Development Act.
Whilst it is not the Group`s intention to entrench an enduring dependency on
these tax incentives on an indefinite basis, given the critical imperative of
the country to rapidly develop skills across its workforce as well as to up-
skill and enhance the potential employability of a sizeable unemployed
constituency, it is likely that these incentives will continue and possibly
increase for the foreseeable future.
With effect 13 October 2009, the Group acquired the business operations of the
Crestfin Group for R13,6 million, which was funded out of the group`s cash
resources. The operations acquired include the employee benefit business
("EBB") and the payroll card business ("PCB"). In terms of IAS 34 requirements
the profit from this entity included in Group profits for the year ended
February 2010
is R0,23 million. This profit has been arrived at after deduction of the
amortisation charges arising from the valuation of the intangible assets
acquired. Since EBB, and more particularly PCB, were fledgling businesses at
the time of acquisition, the purchase consideration has been allocated to
intangibles and a profit of R0,6 million would have been included in the Group
profits, had the effective date of inclusion been 1 March 2009.
During the period May to June 2009, Adcorp purchased 532 493 Adcorp shares for
a total cost of R12,8 million which is an average of R24,06 per share. These
shares have not been cancelled and are treated as treasury shares in the
Group`s weighted average number of shares in issue.
Changes to the board of Adcorp
During the year under review, the Chairman of the Board of Directors, Dr
Fredrick Van Zyl Slabbert, retired due to ill health after providing
exceptional service to the Adcorp Group, its shareholders, clients and staff
for fifteen years.
In the interim, the role of Acting Chairman has been assumed by
Ms Louisa Mojela. The gratitude of the board is extended to
Ms Mojela for her considerable contribution in this role.
In order to strengthen the composition of the board in compliance with the
recommendations of King III, Mr Tim Ross and Mr Mncane Mthunzi both joined the
board of Adcorp as independent non-executive directors with effect from 1
September 2009 and 27 January 2010 respectively. Additionally the Board is in
the process of appointing an independent chairman and an announcement will be
made shortly.
Mr Anthony Sher was appointed as Chief Financial Officer of the Group with
effect from 2 December 2009 following the disqualification and removal from
the board of Ms Faunce Burd, with effect from 4 December 2009.
Ms Gugu Duda resigned from the Board as an Alternate Director with effect from
26 February 2010.
Outlook
The expectation for the ensuing year is that the South African economy will
recover slowly and, Adcorp should benefit as a result.
Strategically, the Group is focused on increasing the level of sophistication
and technological advancement it applies in its day to day operations. Such
initiatives include the introduction of a global leading Vendor Management
System, Skillstream, to which Adcorp has exclusive rights in Africa.
As an adjunct to this, automated timesheet processing is becoming widely
accepted by our client base with commensurate benefits in terms of improving
internal and accounting controls, improving efficiencies and reducing costs.
The introduction of this additional sophistication and technological
advancement should enhance our market position as well as provide an ability
to demonstrate significant value add to clients.
Other strategic initiatives which are beginning to make a useful contribution
to Group profits are the roll out of a number of specifically designed
financial products to our sizeable contract workforce including insurance
products, micro loans and a payroll card.
In addition, the successes achieved in the learnership space should continue
to show good growth, not only in terms of offering these training benefits to
our existing contractor base, but also with the prospect of offering these
services to a far broader external client base.
The recently installed Microsoft Dynamics AX ERP system also offers much
advantage in terms of providing the opportunity for process improvement with
commensurate cost and efficiency benefits.
It is believed that an anticipated limited economic recovery coupled with the
benefits of the abovementioned strategic initiatives, should contribute
positively. Additionally, the "sweet spot" the Group finds itself in with
regard to the alignment of its own objectives with those of the stated
Government imperatives relating to skills development and job creation, means
that the Group is well positioned for the future.
Basis of preparation
Adcorp prepares its accounts in accordance with International Financial
Reporting Standards, South African Companies Act and the JSE Listing
Requirements. The accounting policies are consistent with the prior year
annual financial statements and deal with new disclosures requirements by
IFRS, specifically IAS 1 (Presentation of Financial Statements) and IFRS 8
(Operating Segments). This report is prepared in accordance with IAS 34
(Interim Financial Reporting).
Contingent liabilities and commitments
The bank has guaranteed R12,3 million on behalf of the Group to creditors. As
at the balance sheet date the Group has outstanding operating lease
commitments totalling R70 million in non cancellable property leases.
Capital structure
During the financial year and despite the Group not breaching debt covenants,
certain of the Group`s bankers raised concerns with regard to the Group`s
level of absolute debt given their far more conservative attitude towards debt
levels since the advent of the global credit crisis.
The predominance of the debt was incurred as a result of the acquisitions of
FMS, COG and SUN. These acquisitions were funded by way of a mix of equity and
debt capital in proportions that were entirely acceptable at the various times
of structuring these transactions.
Consequently, and with the benefit of hindsight, the banks adoption of a far
more conservative approach to debt funding meant that to the extent that these
deals were to be structured in today`s credit markets, they would not have
been afforded the same levels of debt funding as they were at the time the
acquisitions were originally concluded. Effectively, therefore, the banks have
required a retrospective redress of these historical funding structures.
As a result, the Group reviewed its capital structure and raised a level of
equity capital in order to redress this imbalance and to reduce overall debt
levels.
In this regard, capital in the amount of R112,5 million was successfully
raised by way of a limited private placement in February 2010, the
consequences of which are reflected in the Group`s balance sheet as at 28
February 2010. As part of the capital restructuring strategy and given current
market conditions, the Board has resolved to propose a scrip distribution with
a cash dividend election as described more fully below.
Subsequent events
No subsequent events have come to the attention of the directors.
Payment of a scrip distribution with a cash dividend election
Notice is hereby given that the directors have resolved, subject to
shareholder approval at the annual general meeting ("AGM") to be held on or
about 23 July 2010 to issue fully paid shares in the company as a scrip
distribution to ordinary shareholders. Fully paid ordinary shares of 2,5 (two
and a half) cents each will be issued as a scrip distribution payable, to
ordinary shareholders recorded in the register of Adcorp Holdings Limited on
the record date, being Friday, 13 August 2010.
Ordinary shareholders will be entitled, in respect of all or part of their
shareholding, to elect to receive a cash dividend of 115 cents per ordinary
share in lieu of the scrip distribution, which will be paid only to those
ordinary shareholders who elect in respect of all or part of their
shareholding, on or before 12:00 on Friday, 13 August 2010, to receive the
cash dividend. The cash dividend will be paid out of profits of Adcorp while
the new ordinary shares to be issued pursuant to the scrip distribution will
be issued as a capitalisation issue by way of capitalisation of part of
Adcorp`s share premium.
The number of new ordinary shares to which ordinary shareholders participating
in the scrip distribution will become entitled, will be determined in the
ratio that 115 cents multiplied by 1,10 bears to the volume weighted average
price ("VWAP") of ordinary shares in Adcorp on the JSE Limited ("JSE") during
the five day trading period ending Tuesday, 27 July 2010.
Details of the ratio will be released on the Securities Exchange News Service
of the JSE ("SENS") by no later than 11:00 on Thursday, 29 July 2010 and
published in the South African press by no later than 11:00 on Thursday, 29
July 2010. A circular relating to the scrip distribution and the cash dividend
election will be posted to shareholders on or about Wednesday, 30 June 2010.
Trading in the Strate environment does not permit fractions and fractional
entitlements. Accordingly, where a shareholder`s entitlement to new ordinary
shares calculated in accordance with the above formula gives rise to a
fraction of a new ordinary share, such fraction will be rounded up to the
nearest whole number where the fraction is greater than or equal to 0,5 and
rounded down to the nearest whole number where the fraction is less than 0,5.
The proposed salient dates and times for the scrip distribution/dividends are
as follows:
Distribution/Dividend of 115 cents per share
announced on SENS Tuesday, 4 May 2010
Circular and form of election posted to ordinary
shareholders Wednesday, 30 June 2010
Results of annual general meeting released on SENS Friday 23 July 2010
Results of annual general meeting published in the
South African press Monday, 26 July 2010
Finalisation data announcement including the ratio
applicable to the scrip distribution, based on the
five-day trading period ending Tuesday, 27 July
2010, released on SENS by no later than Thursday, 29 July 2010
Finalisation data announcement of the ratio
applicable to the scrip distribution published in
the South African press by no later than Friday, 30 July 2010
Last day to trade in order to be eligible for the
scrip distribution/cash dividend (CUM distribution) Thursday, 5 August 2010
Shares trade EX the scrip distribution/dividend
Friday, 6 August 2010
Listing of the maximum possible number of ordinary
shares that could be issued in terms of the scrip
distribution Friday, 6 August 2010
Last day to elect a cash dividend instead of the
scrip distribution by 12:00 Friday, 13 August 2010
Record date in respect of the scrip
distribution/cash dividend Friday, 13 August 2010
Share certificates and dividend cheques posted and
CSDP/broker accounts credited/updated Monday, 16 August 2010
Announcement of the results of scrip distribution
on SENS Monday 16 August 2010
Announcement of the results of scrip distribution
in the press Tuesday, 17 August 2010
Maximum number of new ordinary shares listed
adjusted to reflect the actual number of ordinary Wednesday, 18 August
shares issued on or about 2010
Ordinary share certificates may not be dematerialised or rematerialised
between Friday 6 August 2010 and Friday, 13 August 2010, both days inclusive.
All times provided in this announcement are South African local times. The
above dates and times are subject to change. Any changes will be released on
SENS and published in the South African press.
Where applicable, dividends in respect of certificated shares will be
transferred electronically to shareholders` bank accounts on the payment date.
In the absence of specific mandates, dividend cheques will be posted to
shareholders. Ordinary shareholders who hold dematerialised shares will have
their accounts at their CSDP or broker credited/updated on Monday, 16 August
2010.
Review of results
The results have been reviewed by the independent auditors, Deloitte & Touche.
A copy of their unmodified review report is available for inspection at the
registered office of the company, 28 Sloane Street, Bryanston.
By order of the board
LM Mojela RL Pike AM Sher
Acting Chairman Chief Executive Officer Chief Financial Officer
04 May 2010
Executive directors RL Pike, C Bomela, AM Sher, PC Swart
Independent non- A Alback, M Mthunzi, TDA Ross
executive directors
Non-executive directors LM Mojela, MR Ramaite, T Ramano
Company secretary L Sudbury
Transfer secretaries Link Market Services SA (Pty) Ltd,
11 Diagonal Street, Johannesburg, 2001
Sponsor Deloitte & Touche Sponsor Services (Pty) Ltd
Date: 04/05/2010 14:12:03 Produced by the JSE SENS Department.
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