enX GROUP LIMITED - Transaction, Business And Funding Update

Transaction, Business And Funding Update

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” or “the group”)

TRANSACTION, BUSINESS AND FUNDING UPDATE

TRANSACTION UPDATE

Further to the approval by enX shareholders on 29 November 2019 of the divestment by enX of its
ownership interest in its Fleet Management and Logistics business to Bidvest Bank Limited (“Bidvest”)
(“the Transaction”), shareholders are advised that the final outstanding condition precedent in relation
to the Transaction, being the approval by the Prudential Authority established in terms of the Financial
Sector Regulation Act, 2017 as required in terms of section 52 of the Banks Act, has not been fufilled
by the long stop date of 4 May 2020. enX could not reach agreement with Bidvest to extend the long
stop date to allow sufficient time for the Prudential Authority to complete its process, which was well
advanced. Accordingly, the Subscription Agreement concluded between enX and Bidvest on 12 July
2019 (as amended) has not become effective.

BUSINESS UPDATE

The majority of enX’s businesses have been able to trade, albeit at lower capacity and revenues levels,
since the lockdowns in South Africa and the United Kingdom (“Lockdown”) commenced. Stringent
hygiene controls and protocols have been implemented for those employees working away from home
in full compliance with government directives. To date, no employees have tested positive for COVID-
19. We believe that the gradual easing of Lockdown restrictions that commenced on 1 May 2020 in
South Africa will begin to lift our activity levels and result in improved revenue streams. We expect new
and used equipment sales to remain under pressure due to the weakening of the Rand and slow down
in the economy. Our diversified customer base, annuity revenues and our in-use fleets, which are large,
held at attractive values and funded, will be supportive of the business going forward. We expect the
United Kingdom business will start seeing improvements in revenue from mid-May as their Lockdown
is eased.

FUNDING AND LIQUDITY UPDATE

As detailed in enX’s 2019 integrated annual report, as a result of the termination of the Transaction it is
enX’s intention to engage with its lenders regarding the refinance of the South African leasing
businesses bank term facilities and continue with its debt capital market programme. On 21 April 2020
our R225 million ENX04 note was extended by two years and on 4 May 2020 a R160 million 13 month
reinvestment arising from our maturing ENX05 notes took place. The South African trading businesses
and UK leasing business will continue to maintain their own dedicated credit facilities and attend to
maturities in the normal course of business.

Cash resources arising from a draw down of liquidity lines remain healthy. Debtors collections have
thus far been steady. The Group has taken many steps to reduce cash outflows which include
reductions in overhead, supplier orders and capital expenditure. We will keep on doing this as needed
based on evolving trading conditions. Our major principals continue to support our businesses and enX
has accessed government support programmes to improve liquidity, where available. This has been
particularly beneficial in the United Kingdom.

TRADING STATEMENT

The Group is reviewing its financial reporting obligations arising as a consequence of the termination
of the Transaction. A trading statement, to the extent required, will be released once the board has
reasonable certainty of financial results for the six month period ended 29 February 2020.
Johannesburg
5 May 2020

Sponsor

The Standard Bank of South Africa Limited

Date: 05-05-2020 08:15:00
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