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Change Statement and Annual General Meeting
LABAT AFRICA LIMITED
Incorporated in the Republic of South Africa
(Registration number 1986/001616/06)
JSE code: LAB ISIN: ZAE000018354
(“Labat” or “the company”)
_____________________________________________________________________
CHANGE STATEMENT AND ANNUAL GENERAL MEETING
_____________________________________________________________________
Shareholders are advised that Labat’s annual report, containing the
group’s annual financial statements for the year ended 29 February
2012, will be posted to shareholders in due course and contains
certain changes to the reviewed preliminary condensed financial
results which were published on SENS on 31 May 2012.
Annual general meeting
Notice is hereby given that the annual general meeting of the Group
will be held at 15:00 in the boardroom of the company at 23 Kroton
Avenue, Weltevreden Park, 1709 on 09 November 2012 to transact the
business as stated in the notice of the annual general meeting.
Adjustment to reviewed results
Details relating to the changes and their financial impact are
disclosed below:
Adjustment to condensed consolidated statement of financial position
at 29 February 2012 and 28 February 2011 as presented in the reviewed
results:
Reviewed Adjustment Audited
12 months 12 months
Figures in Rand (‘000) 29 29
February February
2012 2012
ASSETS
Property, plant and equipment 31,301 (147) 31,154
Trade and other receivables 11,311 (9,083) 2,228
EQUITY
Share capital and reserves 2,178 100 2,278
NON-CURRENT LIABILITIES
Loans from shareholders 11,306 (11,306) -
Deferred taxation 5,655 (247) 5,408
CURRENT LIABILITIES
Trade and other payables 30,728 (26,843) 3,885
Loans from shareholders - 11,306 11,306
South African Revenue
Services 301 17,760 18,061
Reviewed Adjustment Audited
Restated Restated
12 months 12 months
Figures in Rand (‘000) 28 28
February February
2011 2011
ASSETS
Property, plant and equipment 31,580 209 31,789
Trade and other receivables 14,795 (10,508) 4,287
EQUITY
Share capital and reserves (23,458) 346 (23,112)
NON-CURRENT LIABILITIES
Loans from shareholders 11,340 (11,340) -
Deferred taxation 6,005 (137) 5,868
CURRENT LIABILITIES
Trade and other payables 29,562 (25,518) 4,044
Loans from shareholders - 11,340 11,340
South African Revenue
Services 301 15,009 15,310
The above adjustment relates to the following matters:
Reclassification of amount owed to SARS
Adjustments made to trade receivables, trade payables and taxation
relates to the reclassification of amounts owed to SARS as a separate
disclosable item on the Statement of Financial Position. All amounts
receivable and payable to SARS have been removed from the trade
payable and trade receivable balances and disclosed as tax payable on
the face of the Statement of Financial Position due to the
significance of these balances. The net effect is a transfer of R17,7
mill (2011: R15 mill) to taxation payable.
Reclassification of shareholders loans
Loans to shareholders have been reclassified from non-current
borrowings to current borrowings. The adjustment is as a result of
additional information after the release of the results pertaining to
the terms of these loans. This has resulted in management
reclassifying the loans to current borrowings.
Realisation of revaluation reserve due to use
The adjustment to property, plant and equipment, share capital and
reserves and deferred taxation relates to the adjustment of the
transfer of the revaluation reserve to retained losses through the
use of the building. This resulted in a reduction in reserves and
realization of deferred tax on the balance of reserves. The net
effect is an increase in share capital and reserves of R100k (2011:
R346k).
Adjustment to condensed consolidated statement of comprehensive
income for the period ended 29 February 2012 as presented in the
reviewed results:
Reviewed Adjustment Audited
12 months 12 months
Figures in rand (‘000) 29 February 29 February
2012 2012
Continuing operations
Revenue 15,544 15,544
Cost of sales (6,960) (6,960)
Gross profit 8,584 8,584
Other income 1,518 1,518
Operating expenses (16,100) (866) (16,966)
Gain on derecognition of
liability 34,020 34,020
Impairments (2,173) 509 (1,664)
Operating profit 25,849 25,492
Investment revenue 17 17
Finance costs (216) (216)
Profit before taxation 25,650 25,293
Taxation 350 110 460
Profit from continuing
operations 26,000 25,753
Discontinued operations
Loss from discontinued
operations (364) (364)
Profit for the year 25,636 25,389
Basic earnings from continuing
operations 13,00 0,06 13,06
Total Basic earnings per share from
continuing operations 12,82 0,06 12,88
Headline earnings from continuing
operations (3,45) 16,96 13,51
Total Headline earnings from
continuing operations (3,63) 16,96 13,33
The above adjustments relates to the following matters:
Realisation of revaluation reserve due to use
Adjustments made to taxation and operating expenses relates to the
additional depreciation recognised on the building component of
property, plant and equipment, resulting in additional operating
expenditure as well as a decrease in the temporary difference
attributable to the decrease in the carrying value of the building
component, resulting in the recognition of deferred taxation effect
through profit and loss.
Reclassifications from impairments
The reclassification relates to the fair value loss on other
financial assets, which was reclassified to operating expenditure
based on the underlying nature of the transaction. Additionally
certain research expenditure relating to the intangible asset was
reclassified to operating expenditure as this was expenditure
subsequent to impairment.
Adjustment to condensed consolidated statement of comprehensive
income for the period ended 28 February 2011 as presented in the
reviewed results:
Reviewed Adjustment Audited
Restated Restated
12 months 12 months
Figures in Rand (‘000) 29 February 28 February
2011 2011
Continuing operations
Revenue 29,915 (2,367) 27,548
Cost of sales (8,737) - (8,737)
Gross profit 21,178 (2,367) 18,811
Other income 17,757 (17,757) -
Operating expenses (24,316) 12,546 (11,770)
Impairments (1,780) 1,780 -
Operating profit 12,839 (5,798) 7,041
Investment revenue 175 (75) 100
Finance costs (860) 66 (794)
Profit before taxation 12,154 (5,807) 6,347
Taxation 954 (814) 140
Profit from continuing
operations 7,555 (1,068) 6,487
Discontinued operations
Loss from discontinued
operations 5,553 - 5,553
Profit for the year 13,108 (1,068) 12,040
Basic earnings from
continuing operations 3,83 (0.54) 3,29
Total Basic earnings per
share from continuing
operations 6,65 (0.54) 6,11
Headline earnings from
continuing operations 3,30 (0.54) 2,76
Total Headline earnings
from continuing operations 7,01 (0.54) 6,47
The above adjustment relates to the following matters:
Adjustment of continuing operations
The continuing operations presented in the reviewed results included
all discontinued operations transaction for the 2011 financial year.
The reviewed results have been restated to improve the
understandability of the continuing and discontinuing operations
disclosure in the Statement of Comprehensive Income The adjustment
does not impact the profit from discontinued operations of R5,5 mill.
Realisation of revaluation reserve due to use
The adjustment to deferred taxation relates to the adjustment of the
transfer of the revaluation reserve to retained losses due to the
utilization of the building component. This resulted in a reduction
in reserves and realization of deferred tax on the balance of
reserves which realized. The effect of the realization resulted in a
decrease in the temporary difference attributable to the decrease in
the carrying value of the building component, resulting in the
recognition of deferred taxation effect through profit and loss.
Change in assessed losses
Subsequent to the publication of the initial reviewed results,
additional supporting documentation came to light from the South
African Revenue Services, resulting in a decrease within the assessed
loss brought forward for the tax year ended 2011. This resulted in a
reduction of the deferred tax expense.
Adjustment to condensed consolidated cash flow statement for the
period ended 29 February 2012 as presented in the reviewed results:
Reviewed Adjustment Audited
12 months 12 months
29 February 29 February
2012 2012
R'000 R'000
Net flow from operating
activities (2,089) (3,163) (5,252)
Net flow from investing
activities 211 412 623
Net flow from financing
activities (91) 2,751 2660
The above adjustment relates to the matters as discussed above.
Adjustment to condensed consolidated cash flow statement for the
period ended 28 February 2011 as presented in the reviewed results:
Reviewed Adjustment Audited
12 months 12 months
28 February 28 February
2011 2011
R'000 R'000
Net flow from operating
activities (5,585) 179 (5,406)
Net flow from investing
activities 4,101 - 4,101
Net flow from financing
activities 4,840 4,840
Net increase/(decrease) in
cash 3,356 3,535
Cash at beginning of period 1,444 (179) .1,265
Cash at end of period 4,800 4,800
Adjustment of continuing operations
Adjustments made in relation to the classification of discontinuing
operation from operating activities to financing activities, as a
separately disclosed item on the face of the cash flow item due to
the significance thereof.
Adjustment to condensed consolidated segment report for the period
ended 29 February 2012 and 28 February 2011 as presented in the
reviewed results:
Reviewed Adjustment Audited
12 months 12 months
Figures in rand (‘000) 29 February 29 February
2012 2012
Technology
Profit for the year 30,812 117 30,929
Other operations (5,176) - (5,176)
Reviewed Adjustment Audited
12 months 12 months
Figures in rand (‘000) 28 February 28 February
2011 2011
Technology
Profit for the year 16,564 (1,059) 15,505
Other operations (3,465) - (3,465)
The above adjustment relates to the matters as discussed above.
Audit opinion
The auditors, Nexia SAB&T have audited the condensed consolidated
annual financial statements for the year ended 29 February 2012. The
auditors modified review report is available for inspection at the
company's registered offices.
The audit report contains the following emphasis of matter paragraph:
Emphasis of matter
We draw attention to the matters below. Our opinion is not modified
in respect of these matters.
Going concern
The going concern paragraph contained in note 3 to the director’s
report indicates that the group’s current liabilities exceeded its
current assets by R 25,6m. Furthermore, note 35 to the consolidated
annual financial statements states that these conditions, along with
other matters, indicate the existence of a material uncertainty which
may cast significant doubt on the group’s ability to continue as a
going concern.
De-recognition of liability
Note 28 to the financial statements indicates that the group de-
recognised a liability owed amounting to R 34.2 million in terms of
IAS 39: Financial Instruments: Recognition and Measurement in
accordance with legal advice received by Labat Africa Limited.
Johannesburg
31 August 2012
Sponsor: Arcay Moela Sponsors (Pty) Ltd
Date: 31/08/2012 03:16:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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