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Updated pro forma financial effects for the eXtract restructure and unbundling
ENX GROUP LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 2001/029771/06)
JSE share code: ENX ISIN: ZAE000222253
(“enX” or “the company”)
UPDATED PRO FORMA FINANCIAL EFFECTS FOR THE EXTRACT RESTRUCTURE AND UNBUNDLING
enX shareholders are referred to the announcements released on SENS on 18 April 2017 and 15 May 2017 regarding, inter
alia, the recapitalisation of eXtract Group Limited (“eXtract”) and the subsequent unbundling of enX’s shareholding in
eXtract (the “transaction”) and the announcement released on SENS on 21 June 2017 regarding, inter alia, the update on
the transaction.
This announcement replaces the pro forma financial effects announcement that was released on SENS on 15 May 2017.
The pro forma financial information (the “financial effects”) of the transaction on enX’s net asset value (“NAV”) per share
and net tangible asset value (“NTAV”) per share at 28 February 2017 and earnings per share (“EPS”), diluted EPS,
headline earnings per share (“HEPS”) and diluted HEPS for the 6 months ended 28 February 2017 are set out below. The
financial effects are the responsibility of the directors of enX and have been prepared for illustrative purposes only to
provide enX’s shareholders with information on how the transaction may have impacted the financial position and financial
performance of enX. Due to their nature, the financial effects may not fairly present enX’s financial position, changes in
equity, financial performance and cash flows subsequent to the transaction.
The financial effects are presented in accordance with the JSE Listings Requirements, the Guide on Pro Forma Financial
Information issued by The South African Institute of Chartered Accountants and the measurement and recognition
requirements of International Financial Reporting Standards (“IFRS”).
The financial effects have been prepared using accounting policies that are consistent with IFRS and with the basis on
which the historical financial information has been prepared in terms of enX’s accounting policies as at 28 February 2017.
The table below reflects the financial effects of the transaction:
Before the After the
cents transaction transaction % change
NAV per share 1 820.6 1 310.2 (28.0%)
NTAV per share 1 367.8 857.6 (37.3%)
Number of shares in issue, net of treasury shares 178 156 747 178 156 747 -
EPS 73.6 51.7 (29.8%)
HEPS 73.6 51.8 (29.6%)
Diluted EPS 72.8 51.2 (29.7%)
Diluted HEPS 72.8 51.2 (29.7%)
Weighted average shares in issue, net of treasury shares 155 154 559 155 154 559 -
Diluted number of shares in issue 156 867 245 156 867 245 -
Notes and assumptions:
1. The figures set out in the “Before the transaction” column above have been extracted from the condensed unaudited
interim financial results of enX for the six months ended 28 February 2017.
2. NAV per share and NTAV per share, as set out in the “After the transaction” column above, reflect the financial effects
on the assumption the transaction was implemented on 28 February 2017 and after incorporating the following
adjustments:
2.1. enX converts its existing preference shares and loans in MCC, except for an amount of R250 million, into
3 755 171 958 eXtract shares. enX’s total shareholding in eXtract amounts to 3 861 041 279 after taking
into account the 105 869 321 existing shares held prior to the conversion;
2.2. Once off transaction costs of R5 million have been accounted for; and
2.3. The 3 755 171 958 eXtract shares held by enX are fairly valued at 20 cents per share (being the closing price at
28 February 2017) resulting in a negative ‘fair value adjustment’ of R113 million.
For noting purposes, the eXtract share price at the actual transaction effective date may be different from the share
price at 28 February 2017, which would result in a different fair value adjustment. If the eXtract share price at
close of business on 19 June 2017, being 8 cents per share, was used, the negative ‘fair value adjustment’ would
have been R575,9 million. This negative fair value adjustment would be recorded in the statement of profit and
loss and other comprehensive income. To illustrate the sensitivity, every 1 cent movement (either up or down) in
the eXtract share price away from the carrying value of the eXtract shares of 23.5 cents per eXtract share at
28 February 2017, will result in an increase or decrease in EPS and HEPS as set out in the “After the transaction”
column of 24.9 cents per share. The amount of the in specie dividend would however change by an equivalent
amount of this fair value adjustment, with the result that there would be no impact on NAV per share and NTAV
per share.
3. EPS, diluted EPS, HEPS and diluted HEPS, as set out in the “After the transaction” column above, reflect the financial
effects on the assumption the transaction was implemented on 1 September 2016 and after incorporating the following
adjustments:
3.1. The income earned on the eXtract Debt of R61 million (and tax thereon of R17 million), is reversed, which
adjustment is of a continuing nature;
3.2. The loss from the associate investment in eXtract of R2 million is reversed, which adjustment is of a continuing
nature;
3.3. The eXtract Debt was advanced and issued on 1 September 2016, as part of the transaction that was detailed in
an announcement released on SENS on 30 June 2016. The negative fair value adjustment of R13 million
recognised in enX’s condensed unaudited interim financial results for the six months ended 28 February 2017,
which relates to valuing the existing 105 869 321 eXtract shares held by enX to their fair value at
28 February 2017, has been reversed as this adjustment would not have been incurred should the transaction
have been effective on 1 September 2016. This adjustment is once-off;
3.4. Once off transaction cost of R5 million have been accounted for.
4. There are no other subsequent events that require adjustments to the financial effects.
21 June 2017
Corporate advisor and sponsor
Java Capital
Independent reporting accountants
Deloitte & Touche Sponsor Services
Date: 21/06/2017 08:56:00 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.
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