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CRM - Ceramic Industries Limited - Declaration of a special dividend and a specific issue of shares for cash CERAMIC INDUSTRIES LIMITED (Incorporated in the Republic of South Africa) (Registration number 1982/008520/06) JSE code: CRM ISIN: ZAE000008538 ("Ceramic" or "the Company") DECLARATION OF A SPECIAL DIVIDEND AND A SPECIFIC ISSUE OF SHARES FOR CASH 1. Declaration of a special dividend Shareholders of Ceramic ("Shareholders") are advised that the board of directors of Ceramic ("the Board") has declared a special dividend of 1 500 cents per Ceramic ordinary share ("Share") to all Shareholders of Ceramic ("Special Dividend"). The reason for the Special Dividend is to return surplus cash to Shareholders. The Special Dividend should be treated by the Shareholders as a payment out of profits. The relevant dates for the Special Dividend are as follows:
Event in relation to the Special Dividend 2011 Last day to trade (cum the Special Dividend) Friday, 3 June Shares commence trading (ex the Special Dividend) Monday, 6 June Record date Friday, 10 June Payment date Monday, 13 June Share certificates may not be dematerialised or rematerialised between Monday, 6 June 2011 and Friday, 10 June 2011 both days inclusive. Shareholders are further advised that Ceramic`s Black Economic Empowerment ("BEE") Shareholders; namely, Aka Ceramic Holdings (Proprietary) Limited ("Aka"), Peotona Ceramics (Proprietary) Limited ("Peotona"), the Ceramic BEE Staff Empowerment Trust No. 2 ("BEE Staff Trust") and the Ceramic Foundation (collectively "BEE Parties") have agreed to utilise a fixed percentage of the Special Dividend to acquire treasury shares from Ceramic`s wholly owned subsidiary company, National Ceramic Industries South Africa (Proprietary) Limited ("Transaction"), further details of which are set out below. The Ceramic treasury shares to be acquired in terms of the Transaction will rank pari passu in all respects with the existing issued ordinary share capital of the Company. The Transaction is considered to be in the best interests of Ceramic as it will enhance its BEE credentials. 2. The Transaction 2.1 Details relating to the Transaction On 11 December 2008, Shareholders approved the allotment and issue of 2 029 285 Shares (approximately 10% of the issued share capital in the Company) to the BEE Parties to assist Ceramic meet its commitments across the BEE scorecard ("BEE Transaction"). The BEE Transaction was structured and funded by the Company. The terms and conditions of the BEE Transaction are more fully set out in a circular to Shareholders dated 19 November 2008. Further to the BEE Transaction, the BEE Parties have agreed to utilise the Special Dividend to acquire Ceramic treasury shares (which Shares will be subject to certain of the terms, conditions and restrictions governing the Shares subscribed for by each BEE Party in terms of the BEE Transaction). The purchase price of each Ceramic treasury share to be acquired by a BEE Party is equal to: - the 30 day volume weighted average price of a Share (as published in the official lists by the JSE Limited ("JSE")) up to and including the day immediately prior to this announcement (being 16 May 2011) being, 13 752 cents ("VWAP"); less - 1 500 cents (being the Special Dividend) per Share; amounting to 12 252 cents per Ceramic treasury share ("Purchase Price"). Based on the Purchase Price, the BEE Parties will acquire the following number of Ceramic treasury shares:
BEE Party Percentage of Rand amount of Number of Special Special Ceramic
Dividend Dividend to be treasury received to be used to shares to be used to acquire acquire acquired Ceramic Ceramic
treasury shares treasury % shares R
Aka 100 6 087 855 49 688 Peotona 100 6 087 855 49 688 BEE Staff Trust 100 6 087 855 49 688 Ceramic Foundation 50 6 087 855 49 688 Total - 24 351 420 198 752 2.2 Pro forma financial effects of the Transaction The unaudited pro forma financial effects of the Transaction are set out below. The unaudited pro forma financial effects have been presented for illustrative purposes only and because of their nature may not give a fair reflection of Ceramic`s results and financial position after the Transaction. The directors of Ceramic are responsible for the preparation of the unaudited pro forma financial effects. Before the After the Change Transaction(1) Transaction(2) % Basic earnings per share 522.7 514.9(4) (1.50) ("EPS") (cents) Diluted earnings per share 496.4 489.2(4) (1.45) ("Diluted EPS") (cents) Headline earnings per share 522.0 515.9(4) (1.16) ("HEPS") (cents) Diluted headline earnings per 490.2(4) (1.11) share ("Diluted HEPS") (cents) 495.7 Net asset value per share 8 404 8 444 0.01 ("NAV) (cents) Net tangible asset value per 8 377 8 418 0.01 share ("NTAV")(cents) Weighted average number of 16 889 598 17 088 350(3) shares in issue (`000) Diluted weighted average 17 785 099 17 983 851(3) number of shares in issue (`000) Number of shares in issue to 17 085 000 calculated NAV and NTAV (`000) 16 886 248 Notes: 1. Based on the published unaudited interim results for the six months ended 31 January 2011. 2. Based on the assumption that the Transaction took place on 1 August 2010 for statement of comprehensive income purposes and 31 January 2011 for statement of financial position purposes. 3. Based on the 198 752 Ceramic treasury shares to be acquired in terms of the Transaction. 4. EPS, Diluted EPS, HEPS and Diluted HEPS have been adjusted to take into account the tax effects and the costs of the Transaction. 5. NAV and NTAV have been adjusted to take into account the cash received, the costs and the tax effects of the Transaction. 6. The interest effects of the Special Dividend and the cash received have not been taken into account. 3. Shareholder approval for the Transaction and posting of a circular The Transaction is treated as a specific issue for cash in terms of the JSE Listings Requirements and as such, Shareholders are required to approve the Transaction in general meeting. Consequently, a circular containing full details of the Transaction and incorporating a notice to convene a general meeting of Shareholders will be posted to Shareholders in due course. Vereeniging 17 May 2011 Sponsor One Capital Legal Advisor Edward Nathan Sonnenbergs Inc. Reporting Accountant KPMG Inc. Date: 17/05/2011 14:17:01 Supplied by www.sharenet.co.za Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.
