Wrap Text
Group unaudited results for the six months ended 30 June 2013
EVRAZ Highveld Steel and Vanadium Limited
(Incorporated in the Republic of South Africa)
(Registration number 1960/001900/06)
Share code: EHS ISIN: ZAE000146171
(the Company)
GROUP UNAUDITED RESULTS
for the six months ended 30 June 2013
Chairman and CEO's Review
- Headline loss R10 million (H1 2012: loss R455 million)
- Net loss R10 million (H1 2012: loss R376 million)
1.Safety
The Companys lost time injuries (LTI) increased from three in Q1 2013 to six in
Q2 2013. The progressive lost time injury frequency rate (LTIFR) increased to
2.49 in Q2 2013 as at 30 June 2013. The total number of injuries decreased by
13% from 45 in Q1 2013 to 39 in Q2 2013.
The Company is continually reviewing current safety measures in order to
improve the safety of its operations.
2.Key financials
The operating profit for H1 2013 was R49 million, compared to a loss of
R200 million in H1 2012. The improved performance can be attributed to
increased sales, higher vanadium prices and reduction in costs. The EBITDA
for the period was a profit of R199 million, compared to a R170 million loss for
H1 2012. Revenue from sale of goods increased to R2 864 million in H1 2013
compared to R2 563 million in H1 2012.
The Board believes that the Company is a going concern. However, there are matters
that may cast significant doubt about the ability of the Company to continue as a going concern.
Labour stability, health of the market and production stability continue to pose a threat to the
operations of the Company. The Company continues to utilise credit lines that are not committed
and payable on demand.
Management has taken significant steps to address the cost structure of the Company and the
abovementioned risks.
3.Operations
Steel
Steel output increased by 2% from 328 566 tons for H1 2012 to 334 560 tons for
H1 2013 as a result of improved shaking ladle process control and melting of
stockpiled iron units.
Production of long products decreased by 20% from 121 114 to 96 880 tons
for the period. Production of flat products increased by 18% from 136 851 to
161 518 tons for the period. These changes are mainly as a result of a change
in market demand.
Inventories of cast steel ahead of the rolling mills are being worked down during
the period June to August 2013 when high peak period electricity tariffs impact
on iron production.
The project to improve kiln pre-reduction performance remains on track for
completion in Q3 2013. This project will assist stable kiln operation resulting in a
reduction of electrical energy consumption in the ironmaking furnaces.
Mining
Production of ore lump increased by 33% from 568 524 tons in H1 2012
to 754 566 tons in H1 2013, and ore fines increased by 22% from 288 721
to 352 683 tons for the same period.
Ore fines pricing deteriorated in Q2 due to a decrease in the London Metal
Bulletin price of vanadium. The pit mining trial that commenced in March
2013 will be running until September 2013. The trial will provide data required
to determine the future operational model for the Mapochs Mine Proprietary
Limited (Mapochs Mine) at increased ore reserves up to a depth of 50 metres.
All tenders and proposals of the Social and Labour Plan housing programme have
been finalised. Construction of the houses will commence in Q3 2013.
Vanadium
Vanadium production remained flat with 26 283 tons of vanadium slag produced
containing 3 539 tons V in H1 2013 compared to 26 399 tons vanadium slag
containing 3 807 tons V during H1 2012.
4.Markets
Global and local markets
Global crude steel production for H1 2013 was 789.8 million tons which
represents a 2% increase for the period. The increase in production resulted
from a 5.5% increase in Asia while all other major global regions indicated
decreased production when comparing H1 2013 with the same period in 2012.
South African crude steel production for H1 2013 was 3.325 million tons
versus 3.722 million tons produced during H1 2012, with the main contributing
factor to the decrease being the fire incident at the ArcelorMittal South Africa
Vanderbijlpark steelworks in February 2013. Consumption information is
published by the South African Iron and Steel Institute (SAISI) on an annual
basis, thus domestic consumption information is not available for H1 2013.
EVRAZ Highveld sales
Steel sales volumes remained flat at 266 896 tons in H1 2013 against
270 377 tons in H1 2012. This includes approximately 11 000 tons of Q4 2012
production despatched in Q1 2013 as customers were closed the last two
weeks of December 2012.
Domestic steel sales increased by 36% from 194 928 tons in H1 2012 to
264 295 tons in H1 2013, while export steel sales volumes decreased
to 2 601 tons in H1 2013 against 75 449 tons in H1 2012.
Ferrovanadium sales for H1 2013 decreased to 2 375 tons V compared to
2 855 tons V in H1 2012. Nitrovan and modified vanadium oxide sales decreased
from 541 tons V in H1 2012 to 436 tons V in H1 2013. Domestic vanadium slag
sales were at 192 tons V in H1 2013 compared to 40 tons V in H1 2012.
5.Wage negotiations
The Company is currently locked into wage negotiations. Whilst Solidarity has
accepted the initial offer, NUMSA has not accepted the offer and has declared a dispute.
A conciliation session was held at the Metal and Engineering Industry Bargaining Council
on 19 August 2013 and the parties continue to negotiate.
6.Outlook
Global growth is projected to remain subdued at slightly above 3% in 2013.
The outlook for all regions in the world in Q4 2013 is improving and global growth
is expected to start gathering momentum and to accelerate through 2014.
The Chinese economy continues to struggle to increase growth with its
Gross Domestic Product (GDP) growth expected to slow down in Q3 2013.
The European economy finds it difficult to stabilise their contraction and the
international steel market will continue to suffer from oversupply. Most 2013
global steel growth forecasts have been revised downwards to between 2%
and 3.5%.
Iron ore prices are expected to decline significantly in Q3 2013 with the main
driver of iron ore demand being global steel production which is dominated
by China.
In the sustained absence of major government infrastructure spending growth,
domestic steel demand is expected to remain slightly below GDP growth since
manufacturing and non-residential construction growth rates for H1 2013 lagged
the GDP growth rate.
It is foreseen that improved operational stability will yield higher steel and
vanadium slag production volume in H2 2013 despite the impediment associated
with the winter operating mode during July and August 2013 compared to the
similar single month situation in June of H1 2013.
BJT Shongwe MD Garcia
(Chairman) (Chief Executive Officer)
21 August 2013
Basis of preparation
The Groups (the Group includes all consolidated entities) financial results for the half
year ended 30 June 2013 set out below have been prepared in accordance with the
principal accounting policies of the Group which comply with International Financial
Reporting Standards (IFRS) and in the manner required by the Companies Act in
South Africa and are consistent with those applied in the Groups most recent annual
financial statements, including the Standards and Interpretations as listed below.
These results are presented in terms of International Accounting Standards (IAS) 34
applicable to Interim Financial Reporting.
The unaudited financial statements were prepared under the going concern basis.
There are matters that may cast significant doubt about the ability of the Company
to continue as a going concern.
Labour stability, health of the market and production stability continue to pose a threat
to the operations of the Company. The Company continues to utilise credit lines that are not
committed and payable on demand.
Management has taken significant steps to address the cost structure of the Company
and the abovementioned risks.
Significant accounting policies
(i) The Group has adopted the following new and revised Standards and
Interpretations issued by the International Accounting Standards Board (the
IASB) and the International Financial Reporting Interpretation Committee (IFRIC)
of the IASB, that are relevant to its operations and effective for accounting
periods beginning on 1 January 2013. These Standards had no impact on the
results or disclosures of the Group.
- IAS 1, Amended Presentation of items of other comprehensive income
(effective from 1 July 2012);
IAS 12, Amended Deferred taxes: Recovery of underlying assets (effective
from 1 January 2012);
- IAS 27, Separate financial statements (consequential revision due to the issue
of IFRS 10) (effective from 1 January 2013);
- IAS 28, Investments in associates and joint ventures (consequential revision
due to the issue of IFRS 10 and 11) (effective from 1 January 2013);
- IFRS 7, Amended Disclosures: Offsetting financial assets and financial
liabilities (effective from 1 January 2013);
IFRS 10, Consolidated financial statements (effective from 1 January 2013);
IFRS 11, Joint arrangements (effective from 1 January 2013);
IFRS 12, Disclosure of interest in other entities (effective from 1 January
2013);
- IFRS 13, Fair value measurement (effective from 1 January 2013);
- IFRIC 20, Stripping costs in the production phase of a surface mine (effective
from 1 January 2013); and
Improvements to IFRS Issued May 2012 (effective from 1 January 2013).
(ii) The Group implemented IAS 19 Employee Benefits from 1 January 2013. The
Group previously only recognised the net cumulative unrecognised actuarial
gains and losses, which exceeded 10% of the greater of the defined benefit
obligation and the fair value of the plan assets. As a consequence, the Groups
statement of financial position did not reflect a significant part of the unrecognised
net actuarial gains and losses. In 2013 the Group changed its accounting policy
to recognise actuarial gains and losses in the period in which they occur in total
in other comprehensive income. Changes have been applied retrospectively in
accordance with IAS 8 Accounting Policies, Changes in Accounting Estimates
and Errors, resulting in the adjustment of prior year financial information.
As a result of the accounting policy change, the following changes were made
to the financial statements:
As of 1 January 2012:
Increase in employee benefit liability: R26 million.
Decrease in opening retained earnings: R26 million.
As of 31 December 2012:
Increase in employee benefit liability: R29 million.
- Net expense recognised on other comprehensive income: R3 million.
Decrease in retained earnings: R26 million.
For the period ended 30 June 2013:
- No increase in employee benefit liability will be calculated end 2013.
No deferred tax impact as the Company is in an assessed loss position and the
deferred tax asset has been impaired.
(iii) The following Standards, amendment to the Standards and Interpretations,
effective in future accounting periods have not been adopted in these financial
statements:
IAS 32, Amended Offsetting financial assets and financial liabilities
(effective from 1 January 2014);
IFRS 9, Financial instruments classification and measurement (effective
from 1 January 2015);
IFRS 9 and IFRS 7, Amended Mandatory effective date and transition
disclosures (IFRS 9 effective from 1 January 2015, IFRS 7 depends on when
IFRS 9 is adopted);
IFRS 10, IFRS 12 and IAS 27, Investment entities (effective from 1 January
2014); and
IFRIC 21, Levies (effective from 1 January 2014).
This abridged report was prepared under supervision of the Chief Financial Officer,
Mr Jan Valenta (Chartered Accountant).
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Unaudited as at Restated as at Restated as at
30 Jun 2013 31 Dec 2012 1 Jan 2012
Notes Rm Rm Rm
ASSETS
Non-current assets 1 710 1 801 1 927
Property, plant and equipment 1 645 1 722 1 760
Deferred tax asset 5 65 79 167
Current assets 2 354 1 866 2 531
Inventories 937 858 831
Trade and other receivables and prepayments 6 787 480 516
Taxation 1
Cash and short-term deposits 630 527 1 184
TOTAL ASSETS 4 064 3 667 4 458
EQUITY AND LIABILITIES
Total equity 1 793 1 709 2 594
Non-current liabilities 803 789 650
Interest-bearing loans and borrowings 7 17 16
Provisions 786 773 650
Current liabilities 1 468 1 169 1 214
Trade and other payables 949 924 1 016
Interest-bearing loans and borrowings 7 385 102
Income tax payable 8 45
Provisions 126 143 153
TOTAL EQUITY AND LIABILITIES 4 064 3 667 4 458
Net cash 228 409 1 184
Net asset value cents per share 1 808 1 724 2 616
CONDENSED CONSOLIDATED INCOME STATEMENT
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Notes Rm Rm Rm Rm Rm
Revenue 1 452 1 233 2 866 2 567 4 354
Sale of goods 1 451 1 232 2 864 2 563 4 346
Cost of sales (1 337) (1 255) (2 581) (2 582) (4 746)
Gross profit/(loss) 8 114 (23) 283 (19) (400)
Other operating income 9 15 115 26 112 138
Selling and distribution costs (63) (80) (127) (153) (248)
Administrative expenses (61) (58) (122) (140) (289)
Other operating expenses (6) (11) (55)
Operating (loss)/profit (1) (46) 49 (200) (854)
Finance costs (18) (9) (37) (20) (52)
Finance income 1 1 2 4 8
(Loss)/profit before tax (18) (54) 14 (216) (898)
Income tax expense 10 (22) (228) (24) (160) (45)
Loss for the period/year (40) (282) (10) (376) (943)
Cents Cents Cents Cents Cents
Loss per share basic and diluted (40.2) (284.3) (10.0) (379.0) (951.1)
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
Loss for the period/year (40) (282) (10) (376) (943)
Other comprehensive income/(loss):
Exchange differences on translation of foreign operations 41 11 88 (2) 49
Actuarial loss on defined benefit plan, net of tax (3)
Total comprehensive income/(loss) for the period/year 1 (271) 78 (378) (897)
Cents Cents Cents Cents Cents
Comprehensive income/(loss) per share basic and diluted 1.1 (273.3) 78.8 (381.2) (904.7)
HEADLINE EARNINGS PER SHARE
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
Reconciliation of headline loss
Loss for the period/year (40) (282) (10) (376) (943)
(Deduct)/add after tax effect of:
Proceeds on successful litigation against the channel induction
furnace supplier (79) (79) (79)
Loss/(profit) on disposal and scrapping of property,
plant and equipment * (*) * (*) (*)
Headline loss (40) (361) (10) (455) (1 022)
*Less than R1 million.
Cents Cents Cents Cents Cents
Loss per share headline and diluted (40.2) (363.7) (10.0) (458.5) (1 030.4)
Million Million Million Million Million
Number of shares
Ordinary shares in issue as at end date * 99.2 99.2 99.2 99.2 99.2
*Rounded to nearest hundred thousand.
Agree to weighted average and diluted number of ordinary shares.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Issued capital
and share Other Retained
premium reserves earnings Total
Note Rm Rm Rm Rm
2012
Balance at 1 January 2012 Restated 585 203 1 806 2 594
Loss for the period (94) (94)
Other comprehensive loss for the quarter (13) (13)
Balance at 31 March 2012 Restated 585 190 1 712 2 487
Loss for the period (282) (282)
Other comprehensive income for the quarter 11 11
Share-based payment reserve 8 8
Balance at 30 June 2012 Restated 585 209 1 430 2 224
Loss for the period (345) (345)
Other comprehensive income for the quarter 13 13
Share-based payment reserve 2 2
Balance at 30 September 2012 Restated 585 224 1 085 1 894
Loss for the period (222) (222)
Other comprehensive income for the quarter 38 38
Actuarial loss on defined benefit plan (3) (3)
Share-based payment reserve 2 2
Balance at 31 December 2012 Restated 585 264 860 1 709
2013
Balance at 1 January 2013 Restated 585 264 860 1 709
Profit for the period 30 30
Other comprehensive income for the quarter 47 47
Share-based payment reserve 11 3 3
Balance at 31 March 2013 Unaudited 585 314 890 1 789
Loss for the period (40) (40)
Other comprehensive income for the quarter 41 41
Share-based payment reserve 11 3 3
Balance at 30 June 2013 Unaudited 585 358 850 1 793
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Cents Cents Cents Cents Cents
Dividends per share
Dividends declared and paid
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
Cash flows from operating activities
Cash generated by/(used in) operations before tax paid 43 76 (190) (210) (608)
Income tax paid (1) (*) (2) (*) (2)
Net cash generated by/(used in) operating activities 42 76 (192) (210) (610)
Cash flows from investing activities
Proceeds from sale and scrapping of property, plant and equipment 1 1 1 4
Additions to property, plant and equipment (30) (36) (68) (97) (203)
Net cash used in investing activities (29) (36) (67) (96) (199)
Cash flows from financing activities
Increase in long-term interest-bearing loans and borrowings 15 15
(Decrease)/increase in short-term interest-bearing loans and
borrowings (17) 283 102
Net cash (repaid)/generated by financing activities (17) 283 15 117
Net (decrease)/increase in cash and cash equivalents (4) 40 24 (291) (692)
Cash and cash equivalents at the beginning of the period/year 583 840 527 1 184 1 184
Effects of exchange rate changes on cash held in foreign currencies 51 10 79 (3) 35
Cash and cash equivalents at the end of the period/year 630 890 630 890 527
*Less than R1 million.
NOTES TO THE CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
1.Companies Act and JSE Limited Listings Requirements
Compliance with the Companies Act, No 71 of 2008, as well as the Listings Requirements of the JSE Limited has
been maintained throughout the reporting periods.
2.Related party transactions
Sales to East Metals A.G. (a fellow subsidiary) amounted to R111 million (June 2012 YTD: R347 million) for
the six months ended 30 June 2013. This constitutes 4% of total revenue for the period, compared to 14% for
the period ended 30 June 2012. Technical services (slag tolling agreement) and other services with EVRAZ
Vametco Alloys Proprietary Limited (a fellow subsidiary) amounted to R48 million for the six months ended June
2013 (June 2012 YTD: R42 million).
3.Segment information
The Group is organised into business units based on their products and has two reportable segments as follows:
Steelworks
The major products of the steel segment are magnetite iron ore, structural steel, plate and coil.
Vanadium
The major products of the vanadium segment are vanadium slag and ferrovanadium. Vanadium slag is a by-
product from the steelmaking process, and this slag is transferred from the steelworks to the vanadium plant,
which then forms the input into the business of the vanadium business.
No operating segments have been aggregated to form the above reportable operating segments. Management
monitors the operating results of its business units separately for the purposes of making decisions about
resource allocation and performance assessment. Segment performance is evaluated based on operating profit.
The following tables present the revenue, operating profit and total assets information regarding the Groups
operating segments:
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
Revenue from customers
Steelworks 1 104 889 2 220 1 894 3 173
Vanadium 431 350 803 685 1 199
Elimination in intersegmental
revenue (84) (7) (159) (16) (26)
Total 1 451 1 232 2 864 2 563 4 346
Unaudited Restated Unaudited Restated
for the for the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
Operating (loss)/profit
Steelworks (54) (153) (91) (387) (1 153)
Vanadium 54 107 140 187 299
Total (1) (46) 49 (200) (854)
Unaudited as at Audited as at
30 Jun 2013 31 Dec 2012
Rm Rm
Total assets
Steelworks 3 329 2 935
Vanadium 735 732
Total 4 064 3 667
4. Supplementary revenue information Unaudited
For the For the For the For the
three month three months six months six months For the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Sales volumes of major products
Total steel Tons 131 384 137 136 266 896 270 377 453 836
Ferrovanadium Tons V 1 291 1 301 2 375 2 855 4 766
Modified vanadium oxide Tons V 85 213 85 228 244
Nitrovan Tons V 127 194 351 313 669
Vanadium slag Tons V 88 40 192 40 181
Ore fines Tons 168 352 212 017 352 322 377 782 687 380
Weighted average selling prices
achieved for major products
Total steel US$/t 752 734 757 789 764
Ferrovanadium US$/kg V 27 24 28 24 23
Modified vanadium oxide US$/kg V 20 18 21 18 18
Nitrovan US$/kg V 29 24 29 24 23
Vanadium slag US$/kg V 10 7 10 7 7
Ore fines US$/t 32 22 38 21 20
Average R/$ exchange rate 9.49 8.13 9.22 7.95 8.21
5. Deferred tax asset
In light of the Companys own financial performance and the uncertainty of future taxable profits to account
against its deferred tax asset, management concluded, following due assessment, that it was prudent to impair
its deferred tax asset as at 31 December 2012 (R297 million) to the extent that it exceeded the deferred taxation
liability. No reversal of the impairment was considered necessary as at 30 June 2013. The deferred taxation asset
of the Group comprises the deferred taxation asset attributable to Mapochs Mine. A management assessment
concluded that no impaiment is necessary.
6. Trade and other receivables and prepayments
The increase in comparison to 31 December 2012 can mainly be attributed to increased sales volumes and
prices in 2013. December months are also historically low sales months due to the holiday periods.
7. Interest-bearing loans and borrowings
The long-term borrowings of R17 million (2012: R16 million) consist of the loan due by Umnotho Iron and
Vanadium Proprietary Limited payable to Umnotho weSizwe Group Proprietary Limited. This loan has no fixed
repayment terms and interest is charged at prime rate. The short-term borrowings are with Citibank and Investec
Bank. The loans are uncommitted and carry interest at market-related interest rates.
8. Gross profit/(loss)
The improvement in gross profit is as a result of improved steel selling prices, increased vanadium- and ore fines
selling prices and reduction in costs.
9. Other operating income and expenses
The 2012 amount consist mainly of the R109 million received relating to the claim against the channel induction
furnace supplier. The R15 million in Q2 2013 includes sundry sales of R3 million and inventory stock count and
inventory net realisable value adjustments of R12 million.
10.Income tax
Unaudited Restated
For the For the for the for the Restated
three months three months six months six months for the
ended ended ended ended year ended
30 Jun 2013 30 Jun 2012 30 Jun 2013 30 Jun 2012 31 Dec 2012
Rm Rm Rm Rm Rm
South African
Normal
Prior year (44)
Deferred
Current 14 228 14 160 86
Non-South African
Normal
Current 8 * 10 * 3
Income tax expense 22 228 24 160 45
*Less than R1 million.
The period income tax expense is accrued using the estimated average annual effective income tax rate applied
to the pre-tax income of the interim report.
11.Share-based payment reserve
Certain key management personnel participate in a Long Term Incentive Plan (LTIP) over shares in EVRAZ plc.
The shares are traded on the London Stock Exchange. The vesting of the shares occur on the 90th day following
the announcement of EVRAZ plc financial results. The cost of the LTIP award will be settled in equity by EVRAZ
plc. The amount recognised according to IFRS 2 in H1 2013 is R6 million (2012 year: R12 million).
12.Guarantees
As required by the Mineral and Petroleum Resources Development Act, a guarantee amounting to R264 million
(2012: R264 million) was issued on 1 February 2007 in favour of the Department of Mineral Resources for the
unscheduled closure of Mapochs Mine. This guarantee is issued by the Company on behalf of Mapochs Mine.
As required by certain suppliers of the Group, guarantees were issued in favour of these suppliers to the value of
R9 million (2012: R9 million) in the event the Group will not be able to meet its obligations to the supplier.
13.Contingent liabilities
In terms of the Groups employment policies, certain employees could become eligible for post-retirement
medical aid benefits at any time in the future prior to their retirement subject to certain conditions. The potential
liability for the Group should they become medical scheme members in the future is R32 million before tax and
R23 million after tax (2012: R32 million before tax and R23 million after tax).
On 5 June 2008, the Commission initiated a complaint against the Company for an alleged contravention of
section 4(1)(b)(i) of the Competition Act, No 89 of 1998 (the Competition Act). The allegations against the
Company are that it fixed prices and trading conditions for flat and long steel products. In a letter from the
Commission, dated 18 September 2009, the Commission confirmed that it would not be pursuing a case
of collusion in the long steel market against the Company. On 30 March 2012, the Commission referred the
complaints relating to the the flat steel market to the Competition Tribunal for prosecution. The allegations against
the Company contained in the Commissions complaint referral are that the Company fixed prices and trading
conditions for flat steel products, and divided markets in respect of flat steel products, which are contraventions
of sections 4(1)(b)(i) and 4(1)(b)(ii) of the Competition Act, respectively. It is further alleged in the Commissions
complaint referral that the Company has contravened sections 4(1)(b)(i) and 4(1)(b)(ii), alternatively section
4(1)(a), of the Competition Act by engaging in the exchange of information with a competitor through information
exchanges and meetings of the SAISI or its committees. Should the Competition Commission be successful, it
could impose a maximum penalty of R554 million against the Company.
14.Subsequent events
There are no events to be reported on since 30 June 2013.
Directors: B J T Shongwe (Chairman), M D Garcia (Chief Executive Officer) (American), G C Baizini (Italian), M Bhabha,
Mrs B Ngonyama, T Mosololi, V M Nkosi, D Scuka (Czech), P S Tatyanin (Russian), J Valenta (Czech) and T I Yanbukhtin (Russian)
Company Secretary: Ms A Weststrate
Registered office
Portion 93 of the farm Schoongezicht No 308 JS
District eMalahleni
Mpumalanga
PO Box 111
Witbank, 1035
Tel: (013) 690 9911
Fax: (013) 690 9293
e-mail: general@evrazhighveld.co.za
www.evrazhighveld.co.za
Transfer secretaries
Computershare Investor Services Proprietary Limited
70 Marshall Street
Johannesburg
PO Box 61051
Marshalltown, 2107
Tel: (011) 370 5000
Fax: (011) 688 5200
Sponsor: J.P. Morgan Equities South Africa (Pty) Ltd
Date: 22/08/2013 05:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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