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SAL
SAL
Sallies - Pro Forma Financial Effects and Withdrawal of Cautionary
SALLIES LIMITED
(Incorporated in the Republic of South Africa)
Registration number 1903/001879/06
JSE Share Code: SAL
ISIN: ZAE000022588
("Sallies" or "the Company")
PRO FORMA FINANCIAL EFFECTS OF THE ACQUISITION OF BUFFALO FLUORSPAR AND
WITHDRAWAL OF CAUTIONARY
Further to the announcement dated 1 August 2006, the pro forma financial
effects of the Buffalo Fluorspar acquisition ("acquisition") are presented
below. These pro forma financial effects are the responsibility of the
directors of Sallies and they have been prepared for illustrative purposes
only, in order to provide information about the financial position of
Sallies assuming that the acquisition had been implemented on 30 June 2006.
Due to its nature, the pro forma financial information may not give a fair
reflection of Sallies" financial position subsequent to the acquisition.
Pro forma Pro forma Percentage
Before After Change
Net asset value per
share (cents) 32.4 42.9 32.4
Tangible net asset
value per share
(cents) 28.6 39.1 36.7
Notes
1 The "Before the acquisition" financial information has been
extracted from the preliminary results for the financial year
ended 30 June 2006.
2 The net asset value per share and tangible net asset value per
share as set out in the "After the acquisition" column have been
adjusted for the acquisition of property, plant and equipment to
the value of R94 million (as per the Competent Person"s Report
("CPR") prepared by RSG Global (Pty) Ltd) which assets were
acquired by means of a cash payment of R65 million. Negative
goodwill of R29 million (being the difference between the cost of
the acquisition and the fair value of the assets and liabilities
acquired) has therefore been raised in terms of IFRS 3: Business
Combinations. Negative goodwill arising on an acquisition is
recognised directly in the income statement. Transaction costs of
R0.5 million have been written off against share premium. The
above purchase price allocation will be reviewed by the auditors
at the June 2007 year end and might therefore change.
3 The operations of Buffalo Fluorspar have been semi-dormant for
approximately the last 12 years and no recent historical trading
results are available. Unaudited pro forma earnings and headline
earnings per share relating to the acquisition are therefore not
provided as the directors of Sallies believe that without the
inclusion of the relevant trading results of Buffalo Fluorspar,
such pro forma earnings and headline earnings per share would be
misleading. As the purchase price for Buffalo Fluorspar was paid
with cash received during June 2006 as a result of the rights
offer and the exercise of options, the payment of the purchase
price will not result in additional interest payments by Sallies.
Withdrawal of cautionary
Accordingly, Sallies shareholders no longer need to exercise caution when
dealing in the Company"s securities.
Johannesburg
20 September 2006
Sponsor
Ernst & Young Sponsors (Pty) Ltd
(Registration number 2000/031843/07)
Date: 20/09/2006 12:16:03 PM Produced by the JSE SENS Department
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