RACEC GROUP LIMITED - Cautionary announcement

Cautionary announcement

RACEC GROUP LIMITED
Incorporated in the Republic of South Africa
(Registration number 1998/006153/06)
 Share code: RAC ISIN: ZAE000105409
(“RACEC” or “the Group”)


   CAUTIONARY ANNOUNCEMENT



Further to the announcement released on SENS on 4 April 2013, shareholders are advised that the
contractual disputes associated with the final contract close-out in Sierra Leone continue. Despite
numerous attempts to resolve the matter amicably, RACEC has had no choice but to pursue its
contractual entitlement for compensation in formal proceedings and has engaged independent
consultants, Van Zyl & Associates (RSA) and Beale & Company (UK), to pursue the matter on the
Group’s behalf.

The quantification of the claims associated with the final contract close-out in Sierra Leone has been
substantially completed, and depending on the outcome of the dispute resolution process, may have a
significant financial impact on the Group.

The quantum of the claims accounted for to date is based on the value of work certified, agreed variation
orders and value of the balance of the works completed under the original contracts.

In addition to the aforementioned matter, additional variation orders, contract scope extensions and plant
standing time which may also have a significant financial impact on the Group, exist. The board of
directors (“the Board”) is awaiting the conclusion of these contract close-outs in order to assess the level
of the financial impact on the Group.

Given the aforementioned matters and the current uncertainty in respect thereof, shareholders are
advised to exercise caution when dealing in RACEC’s securities until a further announcement is made. In
view of the aforementioned matters, the Board has requested the auditors to perform a review of the
interim results for the six months ended 31 March 2013 (“interim results”) and on the amounts to be
recognised in terms of work in progress and receivables balances.

RACEC’s interim results are expected to be released on SENS on or about 28 June 2013.


Cape Town
12 June 2013

Designated Adviser
Merchantec Capital

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