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IOTA FINANCIAL SERVICES LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1968/012195/06)
("IOTA" or "the company")
JSE code: IOT ISIN code: ZAE 4014759
REPURCHASE OF ORDINARY SHARES IN IOTA
1. INTRODUCTION
IOTA shareholders are advised that IOTA has continued its share repurchase
programme in accordance with the rules of the JSE Securities Exchange South
Africa ("JSE") and the general authority granted by its shareholders, which
was renewed at the Annual General Meeting held on 30 November 2001.
2. IMPLEMENTATION
Since the release of the interim results of IOTA for the six-month period
ended 31 October 2001, IOTA has repurchased a total of 1 941 072 IOTA
ordinary shares on the JSE, representing 3.3% of the issued share capital of
IOTA. The 1 941 072 ordinary shares were purchased for a total
consideration of R 1 439 073, at an average price of 74 cents per ordinary
share. The highest price paid was 76 cents per ordinary share and the
lowest price paid was 70 cents per ordinary share. All the repurchases were
made through IOTA Investment Services (Proprietary) Limited ("IOTA
Investment Services"), a wholly-owned subsidiary of IOTA.
3. EXTENT OF GENERAL AUTHORITY OUTSTANDING
The extent of the general authority outstanding for the current financial
year is approximately 10.3 million ordinary shares, representing
approximately 16.7% of the total issued ordinary share capital of IOTA.
4. SOURCE OF FUNDS
The repurchase of shares has been funded from available cash resources.
5. OPINION OF DIRECTORS
The directors having considered the effect of such repurchase of shares by
the company are of the opinion as at 18 January 2001 that there are
reasonable grounds for believing that:
- the company and the group will be able in the ordinary course of business
to pay its debts for a period of 12 months after the date of this
announcement;
- the assets of the company and the group will be in excess of the
liabilities of the company and the group for a period of 12 months after the
date of this announcement. For this purpose, the assets and liabilities
should be recognised and measured in accordance with the accounting policies
used in the latest audited annual group financial statements;
- the ordinary capital and reserves of the company and the group for a
period of 12 months after the date of this announcement shall be adequate;
and
- the working capital of the company and the group for a period of 12
months after the date of this announcement shall be adequate.
6. THE FINANCIAL EFFECTS OF THE REPURCHASE OF SHARES
The table below sets out the financial effects of the repurchase of shares,
based on the published unaudited interim results of IOTA for the six months
ended 31 October 2001:
Before the After the % Change
repurchase (cents) repurchase (cents)
Loss per share (51.5) (53.3) (3.5)
Headline loss per share (23.6) (24.5) (3.8)
Net asset value per
Share 219.7 224.8 2.2
Net tangible asset
value per share 193.3 197.5 2.2
Weighted average number
of shares 56,041 54,100
Number of shares
in issue 55,646 53,705
Assumptions:
- For the purposes of calculating the financial effects on all earnings
related figures, it was assumed that the repurchase of shares was carried
out on 1 May 2001.
- The financial effects are calculated assuming that the repurchase of
shares was financed by excess cash on hand, on which interest was received
at a net rate of 7% per annum, after deducting tax at a rate of 30%.
- For the purposes of calculating the financial effects on the net asset
value and net tangible asset figures, it was assumed that the repurchase of
shares was carried out on 31 October 2001.
7. JSE LISTING
The IOTA shares acquired by IOTA Investment Services will not be cancelled
nor will the JSE listing in respect of these shares be terminated.
Shareholders are further advised that application was made to the JSE on 6
December 2001 to delist 6 000 000 ordinary shares held by IOTA as treasury
stock. The delisting and cancellation of these shares was completed on 13
December 2001.
Johannesburg
18 January 2002
Corporate adviser
IOTA Corporate
Finance (Pty) Limited
Sponsor
PricewaterhouseCoopers
Corporate Finance (Pty) Ltd
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