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TREMATON CAPITAL INVESTMENTS LIMITED
(INCORPORATED IN THE REPUBLIC OF SOUTH AFRICA)
(REGISTRATION NUMBER 97/08691/06)
("TREMATON")
UNAUDITED INTERIM REPORT FOR THE SIX MONTHS ENDED 29 FEBRUARY 2000
GROUP INCOME STATEMENT
(AUDITED)
SIX MONTHS TO SIX MONTHS TO 12 MONTHS TO
29 FEBRUARY 28 FEBRUARY 31 AUGUST
2000 1999 1999
R'000 R'000 R'000
SHARE OF RETAINED INCOME EARNED
BY PRIVATE EQUITY INVESTMENTS 1 526 2 834 2 347
INVESTMENT INCOME NET OF DIRECT
EXPENSES 2 619 1 652 1 330
NET INTEREST EARNED 1 392 3 603 5 434
PROFIT BEFORE EXPENSES 5 537 8 089 9 111
MANAGEMENT EXPENSES (1 062) (1 884) (4 092)
PROFIT BEFORE EXCEPTIONAL ITEMS 4 475 6 205 5 019
EXCEPTIONAL ITEMS (8 537) (1 242) (49 148)
LOSS ON DISPOSAL OF INVESTMENTS - 1 242 13 414
RESTRUCTURING COSTS - - 1 900
INVESTMENT WRITTEN-DOWN 8 537 - 33 834
(LOSS)/PROFIT BEFORE TAXATION (4 062) 4 963 (44 129)
TAXATION 899 912 368
NET (LOSS)/INCOME AFTER TAXATION (4 961) 4 051 (44 497)
LOSS ATTRIBUTABLE TO
OUTSIDE SHAREHOLDERS - 87 -
(ACCUMULATED LOSS)/RETAINED INCOME
FOR THE PERIOD (4 961) 4 138 (44 497)
HEADLINE EARNINGS PER SHARE
(CENTS) 3,4 10,2 3,7
(LOSS)/EARNINGS PER SHARE (CENTS) (4,7) 7,9 (59,8)
GROUP BALANCE SHEET
29 FEBRUARY 28 FEBRUARY 31 AUGUST
2000 1999 1999
R'000 R'000 R'000
ASSETS
NON-CURRENT ASSETS 10 579 8 249 8 026
FIXED ASSETS 593 675 593
INVESTMENTS 55 198 82 005 64 567
LISTED INVESTMENTS 27 424 17 366 37 499
UNLISTED INVESTMENTS 27 774 64 639 27 068
CURRENT ASSETS 67 884 37 671 63 864
ACCOUNTS RECEIVABLE 1 558 1 360 540
AMOUNT DUE FROM SALE OF ASSOCIATE 4 300 7 217 12 000
CASH RESOURCES AND SHORT-TERM
LOANS 62 026 29 094 51 324
TOTAL ASSETS 134 254 128 600 137 050
EQUITY AND LIABILITIES
ORDINARY SHAREHOLDERS' INTEREST 121 671 114 865 126 155
CONVERTIBLE DEBENTURES 10 618 8 275 8 065
CURRENT LIABILITIES 1 965 5 460 2 830
ACCOUNTS PAYABLE 1 460 867 2 830
TAXATION 505 4 593 -
TOTAL EQUITY AND LIABILITIES 134 254 128 600 137 050
NUMBER OF SHARES IN ISSUE ('000) 105 000 52 500 105 000
NET ASSET VALUE (CENTS) 115,9 218,8 120,1
CASH FLOW STATEMENT
29 FEBRUARY 28 FEBRUARY 31 AUGUST
2000 1999 1999
R'000 R'000 R'000
CASH FLOW FROM OPERATING ACTIVITIES 1 693 5 557 (7 551)
CASH FLOW FROM INVESTING ACTIVITIES (43 930) (38 197) (67 504)
CASH FLOW FROM FINANCING ACTIVITIES 2 553 280 59 995
NET MOVEMENT IN CASH AND CASH
EQUIVALENTS (39 684) (32 360) (15 060)
COMMENTS
RESULTS
TREMATON'S HEADLINE EARNINGS PER SHARE FOR THE SIX-MONTH PERIOD WERE 3,4 CENTS
WHICH COMPARES POSITIVELY WITH THE 3,7 CENTS EARNED FOR THE FULL 12-MONTH
PERIOD TO
31 AUGUST 1999. THE RESULTS WERE ADVERSELY AFFECTED BY A FURTHER PROVISION OF
R8,5 MILLION AGAINST THE CARRYING COST OF THE GROUP'S SHAREHOLDING IN PEREGRINE
HOLDINGS LIMITED TO WRITE THE INVESTMENT DOWN TO MARKET VALUE AT 29 FEBRUARY
2000. THIS PROVISION RESULTED IN A LOSS OF 4,7 CENTS PER SHARE.
THE RESULTS FOR THE SIX MONTHS TO 28 FEBRUARY 1999 ARE NOT DIRECTLY COMPARABLE
WITH LAST YEAR'S EARNINGS AS TREMATON DISPOSED OF A NUMBER OF INVESTMENTS
FOLLOWING THE RE-ORGANISATION OF ITS ACTIVITIES WHICH COMMENCED IN MAY 1999.
ACQUISITIONS AND DISPOSALS
TREMATON ACQUIRED A 25% SHAREHOLDING IN REAL AFRICA DUROLINK INVESTMENTS (PTY)
LTD ON 1 NOVEMBER 1999, THE MANAGER OF AND INVESTMENT ADVISER TO AN IT
INVESTMENT FUND, THE REAL TECHNOLOGY TRUST, FOR A CASH CONSIDERATION OF R1,2
MILLION. AN INVESTMENT OF R3 MILLION WAS ALSO MADE IN THE TRUST.
THE 36% SHAREHOLDING IN SUPERCART HOLDINGS (PTY) LTD WAS DISPOSED OF ON 22
DECEMBER 1999 FOR A CASH CONSIDERATION OF R5,5 MILLION AS THIS INVESTMENT WAS
PERFORMING POORLY AND NO LONGER SUITED THE PROFILE OF INVESTMENTS TREMATON IS
CURRENTLY SEEKING TO MAKE. THE SALE PROCEEDS EQUATED TO THE WRITTEN-DOWN
CARRYING VALUE OF THE INVESTMENT IN SUPERCART.
AS ANNOUNCED TO SHAREHOLDERS ON 14 APRIL 2000, TREMATON HAS ACQUIRED AN
EFFECTIVE 11,59% SHAREHOLDING IN THE RESTRUCTURED AND RECAPITALISED NEW AFRICA
TECHNOLOGY HOLDINGS (PTY) LIMITED ("NATH GROUP") FOR A CONSIDERATION OF R58,58
MILLION. THE NATH GROUP IS A MULTI-DISCIPLINARY INFORMATION TECHNOLOGY GROUP
WHICH CURRENTLY HAS FOUR BUSINESS DIVISIONS OPERATING IN 16 MAJOR EUROPEAN AND
ASIAN PACIFIC LOCATIONS AS WELL AS SOUTH AFRICA. IT EMPLOYS SOME 1 200 PEOPLE,
AND IN EXCESS OF 70% OF ITS BUSINESS IS CONDUCTED OUTSIDE SOUTH AFRICA.
BUSINESS DIVISIONS COMPRISE PROPRIETARY SOFTWARE PRODUCTS, SERVICES, HARDWARE
AND IT VENTURE CAPITAL.
FURTHER DETAILS OF THE INVESTMENT IN THE NATH GROUP WILL BE CONTAINED IN A
CIRCULAR, SUBJECT TO THE APPROVAL OF THE JOHANNESBURG STOCK EXCHANGE, WHICH
WILL BE POSTED TO SHAREHOLDERS SHORTLY.
TREMATON HAS ALSO ACQUIRED A 30% SHAREHOLDING IN IT SERVICES GROUP, SOUTHERN
FOCUS HOLDINGS (PTY) LIMITED ("SOUTHERN FOCUS") WITH EFFECT FROM 1 MARCH 2000,
FOR A PURCHASE CONSIDERATION OF R8,4 MILLION, WHICH CONSIDERATION WILL BE
SETTLED BY THE ISSUE OF 4,2 MILLION TREMATON SHARES, AT AN ISSUE PRICE OF R2,00
PER SHARE. THE PURCHASE PRICE WILL BE INCREASED BY AN AMOUNT DETERMINED BY A
MULTIPLE OF THE EXCESS PROFIT EARNED BY SOUTHERN FOCUS FOR THE FINANCIAL YEAR
ENDING 28 FEBRUARY 2001 OVER CERTAIN TARGETS, WHICH INCREASE IN PRICE SHALL BE
PAYABLE IN CASH AND LIMITED TO A MAXIMUM OF R1,2 MILLION. THE OPERATIONS OF
SOUTHERN FOCUS COMPRISE THE DELIVERY OF BUSINESS AND TECHNOLOGY SOLUTIONS TO
MEDIUM AND LARGE CORPORATE, GOVERNMENTAL AND PARASTATAL CLIENTS. HAD THIS
TRANSACTION BEEN EFFECTIVE FOR TREMATON'S FINANCIAL YEAR ENDED 31 AUGUST 1999,
IT WOULD HAVE HAD NO MATERIAL EFFECT ON TREMATON'S NET ASSET VALUE OR EARNINGS
PER SHARE. THE FYNBOS TRUST WHICH IS DISPOSING OF ITS ENTIRE 13,1% SHAREHOLDING
IN SOUTHERN FOCUS TO TREMATON, IS CLOSELY ASSOCIATED WITH THE SUIKERBOS TRUST
WHICH HOLDS 50,1% OF THE ISSUED SHARE CAPITAL OF TREMATON. THIS INVESTMENT
DECISION WAS MADE BY A QUORUM OF DISINTERESTED DIRECTORS.
PROSPECTS
PROSPECTS FOR TREMATON APPEAR POSITIVE PARTICULARLY IN THE LIGHT OF THE
FORTHCOMING LISTINGS OF TWO OF THE SUBSIDIARIES OF THE NATH GROUP ON
INTERNATIONAL STOCK EXCHANGES. THE SHARES IN IOCORE FINLAND OY WILL COMMENCE
TRADING ON THE HELSINKI STOCK EXCHANGE ON 31 MAY 2000, AND IT IS ANTICIPATED
THE SHARES IN INTEC TELECOMS SYSTEMS WILL LIST ON THE LONDON STOCK EXCHANGE IN
THE SECOND HALF OF JUNE 2000.
BY ORDER OF THE BOARD
S M HOLMES
SECRETARY
19 MAY 2000
REGISTERED OFFICE POSTAL ADDRESS
25 MARRIOTT ROAD PO BOX 712
DURBAN DURBAN
4001 4000
TELEPHONE: 031-3098440
FAX: 031-3098432
DIRECTORS: N A LABUSCHAGNE (CHAIRMAN), P DITZ, A EYAL, M FARRER, R B MCELLIGOTT
(CEO), M G MEEHAN, A J F MUNDELL, R E SHERRELL
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