ISIN CODE : ZAE000014759
SHARE CODE : IOT
During the past three months the directors of IOTA have been conducting an
ongoing examination of the Group's activities. This examination has been
supported by a detailed review of certain of the subsidiaries with a view to
evaluating the Group's future direction.
This process has resulted in us detecting a deterioration in the quality of
the debtors book in our wholly owned asset based financing operation, IOTA
Business Finance (Proprietary) Limited (formerly IOTA Rental (Proprietary)
Limited). This deterioration is reflective of the worsening trading
conditions experienced by a number of the businesses with whom IOTA Business
Finance (Proprietary) Limited has had dealings.
A detailed investigation to review the creditworthiness of the above
mentioned underlying debtors book held by this subsidiary has now been
completed. The board has deemed it prudent to increase the doubtful debt
provision of the company by some R25 million. This will have a significant
impact on the Group's trading performance for the six month period ending 31
October 2001. The increase in the provision will not have an effect on the
solvency of IOTA Business Finance (Proprietary) Limited.
The board has further decided that the company will discontinue writing any
further business of this nature. All efforts will now concentrate solely on
the recovery of the outstanding book to minimise any further possible losses
in that company.
Shareholders are also referred to the cautionary announcements published in
the press on 14 June 2001, 4 July 2001 and 16 August 2001. These
announcements do not relate to the aforegoing. Shareholders should
nevertheless continue to exercise caution when dealing with the company's
securities until a further announcement is made.
Johannesburg
10 September 2001
Sponsor
PricewaterhouseCoopers
Corporate Finance (Pty) Ltd
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