| DIRECTORS' REPORT |
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| The directors have pleasure in presenting their report for the year
ended 31 March 2006. |
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| NATURE OF BUSINESS |
| Brait is an investment and financial services group with its primary
listing on the Luxembourg Stock Exchange. It also has secondary
listings on the Johannesburg and London stock exchanges. The group
has shareowners' funds of US$158 million as at 31 March 2006 and
diverse earnings from the following activities: |
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private equity management fees and investment returns; |
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specialised funds management fees and investment returns; |
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corporate and debt advisory services; and |
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group investment returns. |
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| SHARE CAPITAL |
| Authorised |
| The authorised share capital of the company comprises 150 000 000
ordinary shares of no par value. |
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| Issued |
| During the year, the company increased its ordinary issued share
capital from 102 255 732 ordinary shares of no par value by way of a
bonus issue of 8 231 589 ordinary shares to 110 487 321 ordinary
shares of no par value. Of this number, 9 024 663 ordinary shares are
held for delivery of shares granted to management in terms of the Brait
S.A. Share Incentive Scheme, Brait South Africa Share Scheme 2005
and the Brait Executive Share Purchase Scheme. |
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| Unissued shares |
At the forthcoming annual general meeting, members will be asked to
place the unissued shares in the capital of the company under the
control of the directors in terms of the provisions of the company's
Articles of Incorporation.
It should be noted that in terms of the Articles the directors may not
issue shares in any one year, whether for cash or otherwise, if the issue
exceeds 10% of the company's issued ordinary share capital and such
issues shall not in aggregate, in any three-year period, exceed 15% of
the company's issued ordinary share capital. |
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| Renewal of authority for the repurchase of shares |
| The conditions relating to the repurchase by the company of its own
shares are governed by the company's Articles of Incorporation which
provide, inter alia, that this authority shall not extend beyond the date
of the forthcoming annual general meeting unless such authority is
renewed by shareowners in general meeting. At the forthcoming
annual general meeting shareowners will accordingly be requested to
renew this authority until the conclusion of the next annual general
meeting to be held on 25 July 2007. |
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| DEBT CAPITAL RAISED |
In March 2006 a subsidiary of the group, Brait
South Africa Limited, raised US$72,9 million
(ZAR450 million) preference share capital to provide additional
capital to leverage the group's internal growth strategy. A
total of 450 000 (four hundred and fifty thousand) cumulative
redeemable preference shares were issued at a par value of ZAR0,01
and a premium of ZAR999,99 per share. These shares carry a dividend
of 78% of the South African prime interest rate and are redeemable
(at issue price) in four tranches on 31 July of each year commencing
in 2010 until 2013.
Including the abovementioned debt raised, the total borrowings in the
group remain well within the maximum limit of 150% of the total
capital and reserves of the group as stipulated in the company's
Articles of Incorporation. |
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| SUBSIDIARY COMPANIES |
| The interests in subsidiary and associated companies, where
considered to be material in the light of the group's financial position
and results, are set out on pages 108. |
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| FINANCIAL RESULTS |
| The financial results of Brait S.A. group are set out in the
financial statements and accompanying notes for the year ended
31 March 2006. |
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| DIVIDENDS |
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| The board announced an interim dividend of 7,85 US cents
(51,51 South African cents) per ordinary share on 3 November 2005.
The dividend, which absorbed US$8,342,973 was paid on
21 November 2005 to shareowners registered as such on the
record date, 18 November 2005. Shareowners will be asked to ratify
and confirm the declaration by the board and the payment of the
interim dividend at the annual general meeting of shareowners of the
company which will be held in Luxembourg on Wednesday,
26 July 2006. |
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The board has recommended a final dividend of
10,39 US cents per share for the year ended 31 March 2006. In
terms of the Articles of Incorporation, shareowners are required
to approve the declaration of the dividend which will be tabled
at the forthcoming annual general meeting of shareowners of
the company. If approved by shareowners, payment of the final
dividend, in respect of the year ended
31 March 2006 will be effected on Wednesday, 16 August 2006
to shareowners registered as such on the record date, Friday
11 August 2006. The last date to trade "cum dividend' will be
Thursday,
3 August 2006 and the share will commence trading "ex dividend'
on Friday, 4 August 2006. Share certificates may not be dematerialised
or rematerialised between Friday, 4 August 2006 and Friday,
11 August 2006 both days inclusive. No transfers between registers
may take place between Friday,
28 July 2006 and Friday, 11 August 2006 both days inclusive.
Non-resident shareowners registered on the South African register,
who prefer their dividends to be paid in US dollars, are advised
to inform their CSDPs/brokers accordingly and provide their
banking details to their CSDPs/brokers by the required deadline
in terms of their agreements entered into with their CSDPs/brokers. |
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