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REPURCHASE OF ORDINARY SHARES IN PROPER GROUP
Introduction
The directors of Proper Group are authorised to announce the repurchase of 2
320 000 (7% of the issued ordinary shares) of Proper Group's own shares on
the open market on the JSE Securities Exchange South Africa ("the JSE"). In
accordance with the general authority granted to the directors by Proper
Group shareholders at the annual general meeting held on 11 December 2001
("the share repurchase").
Authorised repurchase limits
In terms of the special resolution:
the general authority is limited to a maximum of 20% of Proper Group's
issued share capital of the shares in the applicable class; and
any repurchase may not be made at a price more than 10% above the weighted
average of the market value of the securities for the five business days
immediately preceding the date of such repurchase.
A maximum of 6 464 894 ordinary shares could be repurchased in terms of the
general authority obtained from shareholders.
Implementation
The programme commenced on 19 December 2001 and continued on a day-to-day
basis as market conditions allowed. As at the date of this announcement,
Proper Group has acquired on the JSE, 2 320 000 Proper Group ordinary shares
equivalent to approximately 7% of the issued share capital of Proper Group,
for a total consideration of R2 095 670. The highest price paid was 95 cents
per ordinary share and the lowest was 84 cents per ordinary share.
Source of funds
Repurchases to date have been funded from available cash resources in
accordance with the repurchase programme. Future repurchases will also be
funded from available cash resources.
Opinion of the directors
The directors of Proper Group have considered the impact of the share
repurchase and are of the opinion that:
Proper Group will be able, in the ordinary course of business, to pay its
debts for a period of 12 months from the date of this announcement;
The consolidated assets of Proper Group and its subsidiaries will be in
excess of the consolidated liabilities, measured in accordance with the
accounting policies used in the audited annual financial statements for the
year ended 31 August 2001, for a period of 12 months after the date of this
announcement;
The ordinary share capital and consolidated reserves of Proper Group and its
subsidiaries will be adequate for a period of 12 months from the date of
this announcement; and
The working capital of Proper Group and its subsidiaries will be adequate
for a period of 12 months from the date of this announcement.
Financial effects
The effect on earnings, headline earnings and the net asset value per share
before and after the repurchase of 7% of the issued ordinary share capital,
is set out below. This pro forma financial information has been prepared for
illustrative purposes only and because of its nature may not give a true
picture of Proper Group's financial position and results of operations.
Before After Percentage
repurchase repurchase change
(cents) (cents) %
Earnings per share 12.6 13.2 4.8
Headline earnings per share (3.9) (4.7) (20.2)
Net asset value per share 44.4 40.8 (8.0)
Assumptions
The pro forma earnings and headline earnings per share calculations are
based on Proper Group's results for the year ended 31 August 2001 and assume
that the repurchases to date were carried out on 1 September 2000 and were
financed by excess cash on hand on which interest was received at an average
after tax rate of 6% per annum.
The pro forma net asset value per share calculation is based on Proper
Group's results for the year ended 31 August 2001 and assumes that the
repurchases to date were carried out on 31 August 2001.
JSE Listing
As Proper Group has repurchased all the shares, the shares will be cancelled
and the JSE listing in respect of those shares will be terminated.
Bloemfontein
9 January 2002
Sponsor
KPMG
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