afrimat annual report 2010 annual report 2010 · growth through unity annual report 2010 afrimat...

www.afrimat.co.za

Growth through unity

Annual Report 2010

AFR

IMA

T AN

NU

AL R

EPO

RT 2010

Administration

Afrimat Limited(Registration number 2006/022534/06)

Registered office

Tyger Valley Office Park No. 2

Corner Willie van Schoor Avenue and Old Oak Road

Tyger Valley, 7530

(PO Box 5278, Tyger Valley, 7536)

Telephone: +27 21 917 8840

Facsimile: +27 21 914 1174

Email: [email protected]

Website: www.afrimat.co.za

Company secretary

Routledge Modise Incorporated practising as Eversheds

22 Fredman Drive

Sandton, 2146

(PO Box 78333, Sandton City, 2146)

Telephone: +27 11 523 6110

Facsimile: +27 86 674 8658

Attorneys

Webber Wentzel

10 Fricker Road,

Illovo, 2196

(PO Box 61771, Marshalltown, 2107)

Telephone: +27 11 530 5000

Facsimile: + 27 11 530 5111

Transfer secretaries

Computershare Investor Services (Pty) Limited

(Registration number 2004/003647/07)

Ground Floor, 70 Marshall Street,

Johannesburg, 2001


Telephone: +27 11 370 5000

Facsimile: +27 11 688 5200

Sponsor

Bridge Capital Advisors (Pty) Limited

2nd Floor, 27 Fricker Road, Illovo, 2196

(PO Box 651010, Benmore, 2010)

Telephone: +27 11 268 6231

Facsimile: +27 11 268 6538

Auditors

Mazars

Mazars House, Rialto Road, Grand Moorings

Precinct, Century City, 7441

(PO Box 2817, Cape Town, 8000)

Telephone: +27 21 818 5000

Facsimile: +27 21 818 5001

Commercial bankers

The Standard Bank of South Africa Limited

Business Banking

12th Floor, East Towers, Bedford Centre

Corner Bradford and Smith Streets

Bedfordview, 2047

(Private Bag X23, Garden View, 2047)

Telephone: +27 11 601 4536/5

Facsimile: +27 11 631 8132

Maxx Corporate Communications

Page

Financial Highlights .................................................................... 1

Company Profile .......................................................................... 2

Directorate .................................................................................. 4

Chairman’s Report ...................................................................... 6

CEO’s Report ............................................................................... 8

Sustainability Report ................................................................ 10

Corporate Governance Report .................................................. 13

Audit Committee Report ........................................................... 20

Value Added Statement ............................................................ 21

Annual Financial Statements ................................................... 22

Directors’ Statement of Responsibility .............................. 22

Declaration by Company Secretary .................................... 22

Report of the Independent Auditors .................................. 23

Directors’ Report ................................................................ 24

“ASPASA” Aggregate and Sand Producers

Association of South Africa

“B-BBEE” Broad-based black economic

empowerment

“the board” The board of directors of

Afrimat Limited

“CSDP” Central Securities

Depository Participant

“CEO” Chief Executive Officer

“the Codes” Department of Trade and Industry’s

B-BBEE Codes of Good Practice

“the company” or “Afrimat” Afrimat Limited

“DIFR” Disabling Injury Frequency Rate

“EMP” Environmental Management

Programme

“EXCO” Executive Committee

“FD” Financial Director

“Glen Douglas” Glen Douglas Dolomite (Pty) Limited

“the group” Afrimat Limited and its subsidiaries

“HDI” Historically Disadvantaged Individual

“HEPS” Headline earnings per share

“HIRA” Hazard Identification Risk Assessment

Contents

Definitions

Page

Statement of Financial Position ......................................... 28

Income Statement .............................................................. 29

Statement of Comprehensive Income................................ 30

Statement of Changes in Equity ......................................... 31

Statement of Cash Flows ................................................... 33

Notes to the Annual Financial Statements ........................ 34

Segmental Report .............................................................. 70

Analysis of Shareholders ................................................... 72

Share Performance ................................................................... 73

Shareholders’ Diary .................................................................. 73

Notice of Annual General Meeting ........................................... 74

Form of Proxy ............................................................................ 79

Administration ........................................................................ IBC

“IFRS” International Financial

Reporting Standards

“IT” Information Technology

“JSE” JSE Limited

“King II Report” King Report on Corporate

Governance for South Africa 2002

“King III Report” King Report on Corporate


“Prima” Afrimat Aggregates (Operations)

(formerly Prima Klipbrekers)

(Pty) Limited

“the previous/prior year” The year ended 28 February 2009

“SA” South Africa

“SENS” Stock Exchange News Service

“SARMA” South African Readymix Association

“SHE Committee” Safety, Health and

Environmental Committee

“SWP” Safe Working Procedure

“the year” or

“the year under review” The year ended 28 February 2010

Editorial:

1Afrimat Annual Report 2010

Financial Highlights

n HEPS up 26,7%

n Net asset value of 394

cents per share

n Net debt:equity ratio 10,6%

n Operating margin 14,0%

n Strong performance from

aggregates division

n Total dividends 16 cents per share

HEPS

Net cash from operating activities

Revenue

Net asset value per share

0

100 000 000

200 000 000

300 000 000

400 000 000

500 000 000

600 000 000

700 000 000

800 000 000

900 000 000

Rands

2010200920082007

REVENUE

778 015 852687 090 781

611 659 677

349 032 479

090

180270360450540630720810900

2010200920082007

0

10

20

30

40

50

60

70

80

Cents

2010200920082007

HEPS

40,5

51,3

70,4

58,5

0

50

100

150

200

250

300

350

400

2010200920082007

240

394

369348

Cents

0

20 000 000

40 000 000

60 000 000

80 000 000

100 000 000

120 000 000

140 000 000

160 000 000

Rands

2010200920082007

NET CASH

134 757 595

72 587 13465 745 236 71 422 658

2 Afrimat Annual Report 2010

Company Profile

Vision

Afrimat’s vision is to be the most admired construction materials and industrial minerals supply

company in Southern Africa.

Being the most admired company means to successfully build a core foundation that earns admiration

from all of Afrimat’s stakeholders through:

nEfficient and well-managed operationsn Responsible, honest and highly motivated personnelnEffective and reliable systemsnStrong financial structuren Innovative focused sustainable growth and transformation initiativesnSatisfied stakeholdersnCaring for the people and the planet

Values

Afrimat strives to integrate values of accountability, integrity, trust, mutual respect, teamwork and

customer satisfaction into every aspect of our culture, every division of Afrimat and our overall

performance.

Operations

Afrimat is a black empowered materials supplier to the construction and industrial minerals

industries, and is listed in the “Construction & Building Materials” sector of the JSE Main Board.

Backed by more than 45 years’ experience Afrimat has traditionally supplied a broad range of

construction materials comprising aggregates, readymix concrete and concrete manufactured

products. The post year-end acquisition of the Glen Douglas dolomite mine from Exxaro has seen

the group diversify and expand into the industrial minerals industry.

Operations are supported by a fleet of mobile crushers offering flexibility even beyond historical

geographical areas of operation. Today the group’s integrated product offering is distributed across

a wide geographical area covering rural and urban regions in the Western Cape, Eastern Cape,

KwaZulu-Natal, Free State, Gauteng, Limpopo, Mpumalanga and Namibia.

Afrimat’s flexibility extends further – to project scale – with the group servicing major infrastructure

and construction projects from the public sector and parastatals to small private sector contracts.

The diverse client base acts as an effective risk and revenue hedge.

The group’s consistently low staff turnover has resulted in a deep skills pool. Real transformation,

starting with staff and management and extending to community upliftment, is integral to the group’s

sustainability. In addition environmental conservation is an imperative part of the group’s growth

strategy.


The division operates primarily in

KwaZulu-Natal, the Free State and in

Worcester in the Western Cape,

manufacturing concrete blocks and

bricks largely for low-cost housing.

Precast factories specifically

manufacture concrete bricks, building

blocks, brick paving, walling and

moulded concrete products, of which

the bulk carry the SABS seal of

approval.

n Concrete brick and block factories (8)

t

The division produces aggregates

of a wide variety of sizes and technical

specifications primarily for

large-scale civil engineering and

infrastructure projects.

Afrimat continually ensures that stone

reserves are adequate and sustainable

for the long-term needs of the group.

Reflecting cohesive vertical integration

Afrimat’s proprietary commercial

quarries – located in seven of South

Africa’s provinces and in Namibia – also

supply the majority of raw materials for

the Readymix Concrete and Concrete

Manufactured Products divisions.

n Commercial quarries (25)

n Sand mines (7)

n Contract crushing services

n Drilling and blasting services

t

The division supplies concrete primarily

to large-scale civil engineering and

infrastructure projects through fixed

and mobile readymix plants, where

concrete is batched on demand and

then transported to site by concrete

mixer trucks. Products meet the

standards set by SARMA.

n Batching sites (21)

t

Unallocated 1%

Aggregates 77%

Readymix Concrete 11%

Concrete Manufactured Products 11%

Operating profit by segment

Aggregates Readymix Concrete Concrete ManufacturedProducts


directorate

Andries J van Heerden (44)CEOB.Eng (Mech) MBA (University of Stellenbosch)

Government Certificate of CompetenceAndries has extensive experience in strategic positioning, marketing and finance. During 2001 he joined the Prima group as a director and became Managing Director two years later. He left Prima in 2005 and formed a consortium which acquired the Lancaster group, of which he became CEO. He was instrumental in 2006 in the formation and listing of Afrimat from the merger of Prima and Lancaster. Andries was a finalist in the 2008 Ernst & Young World Entrepreneur awards in the category “Emerging Entrepreneur”.

Hendrik P Verreynne (53)Financial directorB.Compt Hons CA(SA)Prior to joining Afrimat Hendrik, a chartered accountant, was Financial Director of Oceana Brands Limited. Previously he was a senior executive in finance for Woolworths and Borden Foods and Financial Director of Sea Harvest.

Peter G Corbin (61)B.Sc B.Eng (University of Stellenbosch)Peter has extensive experience in the engineering sector and particularly in roads construction, having worked as an engineer at the Department of Internal Affairs and as the resident engineer at VKE Consulting Engineers. He was divisional director of Concor Construction (Pty) Limited prior to joining Prima in 1985, where he was promoted to Managing Director in 2005. He is now responsible for New Business Development in the Afrimat group.

Executive directors Non-executive directors

Loyiso dotwana (46)B.Sc Civil Engineering (University of Cape Town)Loyiso has worked as a civil engineer in design and project management for more than 20 years. He specialised in design and contract administration of township services, rural and urban roads and national roads. He has been involved in the conceptual and detailed design of bulk services for the Coega Industrial Development Zone in Port Elizabeth. Loyiso founded Illiso Consulting (Pty) Limited, one of South Africa’s largest black-owned consulting engineering companies, of which he is currently a director and the major shareholder.

Francois du Toit (63)Francois joined Prima Klipbrekers (Pty) Limited as Managing Director in 1967 and helped establish the Prima group 12 years later, where he remained as Managing Director until 2003 and as Chairman until his retirement in 2009.

dr Laurie P Korsten (68)CA(SA) Phd (Honoris Causa) (Potchefstroom University) Laurie, a chartered accountant, began his professional career at the Industrial Development Corporation (IDC) where he later headed up the Financial Investigations and Small Business Divisions. Laurie was one of the founding shareholders and executive directors of Finansbank Limited. He is also a past chairman of the SA Merchant Bankers Association and a past executive chairman of Volkskas Merchant Bank and Volkskas International Bank. In 1991 Laurie was appointed by the South African Cabinet as Chairman of the Korsten Committee to investigate government pension funds. He also served as chairman of Rusfurn Limited and as a Trustee of CANSA. Currently he serves as chairman and controlling shareholder of the investment holding companies Korfonds (Pty) Limited and Forecast Investments (Pty) Limited.

directorate

Top row left to right: Andries van Heerden, Hendrik Verreynne, Peter Corbin Bottom row left to right: Loyiso Dotwana, Francois du Toit


Phuti RE Tsukudu (56)MEd, University of Bristol Postgraduate diploma in Adult

Education B.A. (SW) Phuti is an Organisational Development and Management Consultant and is currently Managing Director/Senior Consultant at Tsukudu Associates and a Partner/Senior Consultant at CRG PPS. She has extensive experience in Organisational Development, Human Resources Management and Human Resources Development in the public, private and non-governmental sectors – over 15 years’ experience as an independent consultant and over 10 years as a community development practitioner working in the development and education arena. She continues to hold a number of board positions.

Hendrik (Hennie) JE van Wyk (66)B.Com CA(SA)Hennie qualified as a chartered accountant in 1975 with Brink Roos & Du Toit, where he became partner three years later. In 1987 he was appointed lead partner in the Cape Town office of Theron du Toit and in 1990 lead partner of Coopers & Lybrand at the time of the merger with Theron du Toit. In 1998 he became Managing Partner of PricewaterhouseCoopers Inc. Western Cape, a position that he held until his retirement.

Marthinus (Matie) W von Wielligh (58)ChairmanB.Sc (Mech. Eng.) (University of Pretoria) MBA (University

of Stellenbosch), Stanford Executive Programme (Stanford

University USA)

Matie has over 30 years’ professional experience at Iscor

Limited and Kumba Resources. At Iscor he served in various

management positions before becoming Managing Director

of Sishen Iron Ore Company until 2006. At Kumba Resources

he was general manager of the Iron Ore Business. He has

extensive experience in strategic and financial management,

corporate finance, new business development, feasibility

studies, project management, human resources management

and B-BBEE.

Independent non-executive directors

Top row left to right: Laurie Korsten, Phuti Tsukudu, Hennie van Wyk Bottom row: Matie von Wielligh


Chairman’s Report

Against the backdrop of an increasingly challenging trading

environment, Afrimat extended its geographic footprint

in Gauteng and posted a reasonable performance for the

year. The focus on cost rationalisation and growth initiatives

ensured that the group consolidated and cemented a solid

platform for growth.

Business environmentThe global financial crisis has generated a tough macro-

economic environment in South Africa and globally with

continued concerns regarding the magnitude of debt in

developed countries. Tight credit restraints, exacerbated

by inevitable negative sentiment – specifically regarding

construction – continued to impact on the residential sector,

small-scale construction industry and mega projects such

as Kusile power station. Investor sentiment towards the

construction sector as well as small-sized companies is poor

at the moment.

Investment by government in new domestic infrastructure

as well as refurbishment of existing infrastructure did not

materialise as expected.

Volatility in the global markets has also resulted in low

investor confidence with uncertainty resulting in lack of

direction.

Afrimat strategyThe group seeks to add value along the supply chain from

aggregates upwards as well as evaluating opportunities

within industrial minerals where synergies exist and core

competencies can be applied.

The business development team will continue to focus on

growth through product enhancement and expansion as well

as strategic geographic diversification into high-growth areas

– particularly those benefiting from public sector spend on

infrastructure.

In doing so Afrimat aims to realise its strategic objective to “be

there first”, which is underpinned by the group’s operational

ability and flexibility to “go where the work is” by leveraging

its widespread geographic presence and well-equipped fleet

of mobile crushers.

Financial resultsAggregates achieved a good recovery in volumes supported

by expanded geographic spread. Headline earnings therefore

reflected a strong recovery of 30,3 % from the previous year.

Notwithstanding the challenging market conditions Readymix

Concrete and Concrete Manufactured Products continued

to contribute positively to results. In addition Contracting

Services, within the Aggregates division, secured contracts

enabling it to increase its contribution to group earnings.

Further details on the financial results are set out in the

CEO’s Report and the annual financial statements and

accompanying notes.

BEEThe group remains committed to improving B-BBEE to

ensure genuine transformation and thereby contribute

meaningfully to the South African business and socio-

economic environment.

During the year Afrimat assisted its black employees in

acquiring 16,8% of the issued share capital through funding

provided to the Afrimat BEE Trust. This resulted in existing

BEE shareholders and the group’s black employees now

holding a 26,1% stake, well ahead of Mining Charter

Requirements for 2014.

In addition the group will continue to focus on all remaining

scorecard areas to continually enhance B-BBEE.

Furthering its commitment to enterprise development the

group continued to provide support and assistance to develop

black-owned businesses.

Sustainability, corporate governance and risk managementBeing a responsible corporate citizen is a key focus area

for Afrimat. With this as a framework, despite reasonable

improvement during the year the board still deems the

group’s current safety performance to be unsatisfactory. As

a result appropriate policies and procedures have now been

implemented and systems are firmly in place to ensure further

improvement. A new Health & Safety Policy was launched

during the year emphasising the group’s commitment to a


proactive health and safety management system and its goal

of achieving a zero accident rate. (See “Sustainability Report”

for further detail.)

Afrimat has made further progress in the implementation

of best practice corporate governance processes and

procedures. In addition risk management systems have been

formalised throughout the group while administration and

information systems are being improved.

The group has commenced implementing the key aspects

of King III and will be updating its procedures and policies

accordingly. In acknowledgement of the “apply or explain”

approach the board will seek to clarify any areas of non-

compliance, particularly where compliance in these areas

has been deemed not to be in the interests of all stakeholders.

(See “Corporate Governance Report” for further detail).

directorateMonty Kaplan retired from the board with effect from

19 August 2009. The board thanks him for his contribution as

a board member and chairman of the Audit Committee.

Laurie Korsten and Phuti Tsukudu joined the board during

the year, further enhancing the balance of skills and

experience. The board welcomes them and looks forward

to their input.

Outlook Prospects for the construction materials supply industries

remain contingent on the general economic outlook and

confidence in developed countries to service their debt. In

the short-term we expect the difficult business conditions

to prevail but we expect a more vibrant economic climate

in 2011. In the South African context there is a serious

need to refurbish and expand key infrastructure. Afrimat

will therefore focus on executing its strategic aspirations to

continue increasing growth in shareholder value.

AppreciationI extend my appreciation to Andries, the executive directors,

the management team and all Afrimat employees for their

hard work and commitment in a demanding year. I also

thank my colleagues on the board for their support and wise

counsel during the year.

I finally wish to thank our advisors, business consultants,

suppliers and customers for their ongoing loyal support.

Matie von Wielligh

Chairman

28 June 2010


CEO’s Report

The group’s diversification strategy into complementary

markets and its expanding geographical footprint with large-

scale infrastructure projects into the Eastern Cape, Gauteng,

KwaZulu-Natal, Limpopo and Mpumalanga successfully

challenged the economic downcycle with a stronger year-on-

year financial performance and net profit increase of 26%.

The excellent performance of the Aggregates division notably

contributed to overall revenue, in particular as a result of its

pre-emptive shift away from the deteriorating Western Cape

market.

The group’s two acquisitions – Blue Platinum quarry and Glen

Douglas dolomite mine – are both complementary to its core

competencies as well as, in the case of the latter, diversifying

into the industrial minerals market.

Stringent working capital management has paid dividends

leading to a healthy decline in inventories and debtors,

reinforcing the strong balance sheet.

Afrimat’s geographic and product diversification, excellent

forward vertical integration and highly experienced team

continue to differentiate the group amongst its peers.

Financial results Revenue increased year-on-year to R778 million from

R687 million in 2009. Headline earnings of R70,4 million

translated into HEPS of 51,3 cents, an increase of

26,7%. The net debt-to-equity ratio of 10,6% remained

strong and is one of the best in the industry. In light of

the good growth the group declared a final dividend of

10 cents a share, bringing the total dividend for the year to

16 cents compared to 13 cents for 2009.

The group is capitalising on the low share price and had

repurchased 4 449 314 shares at the date of this report.

Further details on the financial results are set out in the

annual financial statements and accompanying notes.

OperationsAggregatesLarge-scale infrastructure contracts were secured outside

of the Western Cape’s deteriorating market in provinces

such as Gauteng, Limpopo and Mpumalanga, which has

lifted volumes and helped the division overcome the negative

Western Cape conditions.

All new processing plants have become fully operational

during the year and the Denver quarry in Port Elizabeth (which

supplies the Nelson Mandela metropole), the KwaZulu-

Natal operations as well as Contracting Services performed

strongly. The division remains well-placed to supply

government infrastructure programmes and contributed

77% to the group’s operating profit.

Readymix Concrete As a result of pressure on the Western Cape volumes and

industrial action at the Ulundi operations in KwaZulu-Natal

during the first half of the year, Readymix Concrete came

under severe pressure. Nonetheless the division achieved an

operating margin of 6,2%, which can be regarded as one of

the best in the industry. Readymix Concrete accounted for

11% of group operating profit.

Concrete Manufactured ProductsIndustrial action in KwaZulu-Natal also impacted negatively

on the volumes in the Concrete Manufactured Products

division. Margins of 12,1% came off an unprecedented high

base of 20,4% in 2009 but remain one of the best in the

industry. Concrete Manufactured Products made up 11% of

the group’s total operating profit.

AcquisitionsJuly 2009 saw the acquisition of a 66% stake in Blue

Platinum quarry, which is strategically located to service

the development boom in the Lanseria area. The acquisition

further boosted the group’s growing presence in the Gauteng

region.

Post year-end the group acquired the entire issued share

capital of Glen Douglas dolomite mine from Exxaro Resources

for R35 million. This marks Afrimat’s diversification into the

industrial minerals sector while further complementing core

competencies. With an output of approximately 1,2 million

tonnes the Glen Douglas quarry south of Johannesburg is set

to become the largest in Afrimat’s portfolio. The acquisition

is expected to yield significant benefits for the group once the


turnaround strategy optimises the mine’s efficiencies over a

timeline of three years.

ProspectsThe board is confident that government’s ongoing

infrastructure development commitment which is expected

to stimulate demand for Afrimat’s products, coupled with the

group’s strong footprint in this sector, bode well for Afrimat’s

growth. The New Business Development team remains

focused on identifying attractive opportunities in high growth

sectors while the marketing of Afrimat’s capabilities will be a

high priority for the group.

The interest rate cut is set to stimulate opportunities within

the private sector and residential housing market although

the recovery is only likely to become evident from the end of

2010. Operations in Namibia are also expected to pick up.

Afrimat is well positioned for additional work from Medupi

and Kusile power stations, low-cost housing developments

and road projects across the country, including the

N1/N2 Winelands road project which is currently out to

tender. Further, its recent expansion into the industrial

minerals sector will benefit from the group’s expertise in

open-pit mining and crushing.

The focus will remain on expanding volumes and reducing

costs across all operations while further diversifying the

product offering.

AppreciationI wish to thank all management and staff for their efforts,

teamwork and dedication which resulted in Afrimat’s pleasing

performance in a continued challenging economic climate. It

is a privilege to lead such a competent and experienced team.

I also extend my appreciation to the board for their invaluable

insight and guidance.

Andries van HeerdenCEO

28 June 2010

n Large-scale infrastructure contracts securedn BEE shareholding increased to 26,1%n Acquisition of Blue Platinum quarryn Diversification into industrial minerals

Strategic highlights


Sustainability Report

Committed to real transformation and acting as a responsible

corporate citizen, Afrimat acknowledges the need to conduct

its business in a sustainable manner as part of its long-

term growth strategy. Reporting on its triple-bottom line is

therefore integral to every decision made by the board and

management and forms an inextricable component of risk

management.

B-BBEEIn terms of the Codes, three of Afrimat’s significant trading

subsidiaries (all of whom have now been independently rated)

are regarded as Level 5 B-BBEE contributors – 80% of spend

with these subsidiaries can be treated by clients as BEE spend.

The Codes are continually being addressed through Ownership,

Management Control, Employment Equity, Skills Development,

Preferential Procurement, Enterprise Development and Socio-

Economic Development and measured annually.

Ownership During the year Afrimat increased black ownership to 26,1%

to reach the target set by the Mining Charter in advance

of the 2014 deadline. The group proved its commitment to

increasing black ownership when it introduced the Afrimat

BEE Trust Share Purchase Scheme. Non-executive director

L Dotwana represents Mega Oils, a 100% black-owned

company. B-BBEE shareholders are set out below:

Shareholder Shares

Mega Oils (Pty) Limited 6 239 529

Mega Oils SPV (Pty) Limited 6 392 575

Joe Kalo Investments (Pty) Limited 738 234

Afrimat Empowerment Investments

(Pty) Limited/Afrimat BEE Trust 24 050 000

ManagementOf the group’s 1 437-strong workforce, 80,2% comprises

HDIs. Two board members are black, one of whom is

a woman.

Employment equityThe group has a formal policy of implementing non-

discriminatory employment practices that recognise and

reward initiative, effort and merit across the board while at

the same time prioritising the advancement of HDIs.

In line with the Employment Equity Act, Afrimat’s recruitment

policies attract the necessary competencies while creating

equal employment opportunities. Employment equity goals

are communicated to staff via management at group and

subsidiary management meetings.

Notwithstanding tough market conditions, an industry-wide

shortage of skilled professional black candidates continues

to pose a challenge.

Staff retention remains excellent due to the continual

expansion of the business and attendant employment

progression and advancement opportunities. Afrimat’s ability

to “go where the work is” is a further advantage in this regard

which helped the group to restrict retrenchments to almost

nil during the difficult economic cycle.

The bricks and block plants are the group’s major job-

creation drivers and automation is therefore limited to

preserve as many jobs as possible.

Skills development and training

Afrimat is committed to employee empowerment programmes

to raise performance in their current positions and to ensure

promotion by equipping employees with all the necessary

technical, administrative and management skills. Priority is

given to advancement and promotion of HDIs wherever

possible and practically viable. Ongoing training is an

operational imperative through a combination of internal

training and external suppliers.

Now in its third year, the “Talent Management Programme”

continues to progress well with the use of a Talent

Management Matrix to guide succession planning,

identification of key performers, staff retention (motivation

and reward), young talent development and performance

management.

During 2009 a total of over R0,7 million was committed to

training spend. In aggregate 897 employees participated, of

which 79% were black. Courses ranged from Adult Basic

Education and Training (ABET) through operational and safety

training to computer literacy and technical, supervisory,

administrative and management skills. In addition the group

provides study loans for tertiary qualifications. In line with


succession planning, candidates have been identified and are

receiving personal mentorship. Areas of focus include

mechanical and civil engineering as well as management,

accounting, HR management and transport management.

Preferential procurement and enterprise development

The group gives preference to procurement from suppliers

with a satisfactory B-BBEE rating. Afrimat also provides

assistance of various sorts where possible to develop

black-owned enterprises according to the Preferential

Procurement Act, B-BBEE Act and the Codes as the primary

points of reference. Extensive use is made of black-owned

transport sub-contractors for distribution to customers.

Socio-economic development

Afrimat is committed to the socio-economic development

and empowerment of local communities. The group targets

1% of Profit After Tax by each B-BBEE rated subsidiary for

projects of this nature and is committed to expenditure and

action in terms of the social and labour plans required by the

Department of Mineral Resources for mining licence

purposes. An annual progress report in this regard is

submitted to the Department of Mineral Resources.

The group’s support of community upliftment initiatives in

the areas in which it operates include the “Unemployed Youth

Driver Licence Project” to enable participants to obtain jobs

and sponsoring a full-time maths teacher, a food garden and

three soup kitchens all in Worcester, the building of Stanford

community centre together with the Caledon Casino and

various school support projects across SA. Local management

further identifies other potential projects in which the group

could participate and liaises with the local economic fora in

this regard.

Safety, Health and Environment (“SHE”)Health and safetyThe group prioritises health and safety as critical to operating

successfully and sustainably. Management is primarily

responsible for implementing the group’s Health and Safety

Policy. A dedicated SHE Committee for every geographical

region is committed to researching new technological

advances in order to maintain a healthy working environment

and ensure Afrimat’s strict compliance with the South African

Occupational Health and Safety Act, 1993, and regulations.

Further, a SHE Officer is appointed for each region and

reports to the Group SHE Manager.

A combination of training, inspections, audits, the mandatory

use of personal protective equipment, ongoing risk

identification and formal monthly incident reporting assist in

carrying out this important operational responsibility.

Independent associations of which Afrimat is a member –

ASPASA and SARMA – perform various audits. Further, the

Department of Mineral Resources performs random

inspections at the group’s quarries.

During the year, a range of health and safety courses were

held to increase SHE awareness including:

• basic safety induction training;

• first aid;

• safe work procedures;

• risk identification;

• fire training; and

• operator and SHE policy training.

Afrimat has embarked on a process of developing reporting

formats regarding health and safety training at group level to

ensure that appointed responsible persons receive the

relevant training.

Health and safety risks are proactively identified through

process-based HIRAs at each site. Risks identified during the

HIRA process are mitigated and/or managed by writing and

implementing SWPs. HIRAs and risk mitigation are performed

using Afrimat’s established scoring mechanisms to determine

the likelihood of the hazard actually occurring and the

consequence of the incident/accident.

Site-specific SWPs and other related controls are developed

and implemented for hazards with an unacceptable risk

rating and all affected staff are trained. Hazards are

re-rated after implementing SWPs and controls. The process


Sustainability Report (continued)

is repeated until all hazards and associated risks are at

acceptable levels.

Afrimat also has a well-developed Incident Management

System which involves the following steps:

• reporting the incident using the correct documentation

and reporting channel;

• incident investigation under the guidance of a qualified

investigator (SHE Officer);

• incident root cause determination;

• identification of corrective action to prevent recurrence;

• formal tracking of corrective action implementation; and

• incident close-out (ie all identified corrective actions

implemented and formally signed off).

All injuries incidents have been fully investigated and reported

to management and the board in accordance with the Incident

Management System above.

Afrimat has a policy of frequent medical surveillance of all

operational staff exposed to any type of personal/medical

risk. The group further recognises the detrimental effects of

drug and alcohol abuse on work performance and aims to

minimise this risk with assistance to affected employees

willing to cooperate. In addition the group has in place a

smoking policy in compliance with the Tobacco Products

Control Amendment Act.

Afrimat’s concern about the HIV/AIDS pandemic threatening

South Africans has led to the formation of a formal HIV/AIDS

policy which is reviewed annually. This is aimed at preventing

workplace discrimination against employees living with HIV/

AIDS and encourages early detection and treatment. The

group highlights issues around HIV/AIDS awareness through

channels such as the staff newsletter, HIV/AIDS posters on

notice boards, information leaflets in support of World AIDS

Day, compulsory annual medical examinations and

counselling on HIV/AIDS.

Environment

Afrimat is committed to identifying means of limiting any

potential harmful effect on the environment and is

well-respected for its EMPs that comply with all legislation

and global best practice standards. To ensure that EMPs

remain in line with these standards, Afrimat continually

monitors regulatory and technical developments and

guidelines in SHE management. Awareness updates are

presented at monthly SHE meetings. All new employees

undergo environmental training during induction training.

The group is committed to limiting its carbon footprint. To

this end Afrimat implements measures such as using rain

water and re-used water from settlement ponds wherever

possible at quarries and uses the quarterly staff newsletter

to raise water wastage awareness. Currently, hazardous

chemical substance spillages, (ie oil and petrol) are receiving

a fair degree of focus.

Third party audits by ASPASA, SARMA and external

consultants assist management in identifying improvement

opportunities. Environmental progress reports are submitted

annually to the Department of Mineral Resources in terms of

mining licence requirements. Mine rehabilitation assessments

are conducted by external consultants and provisions are

raised to meet these future obligations.

Labour relations

Solidarity, NUM, WELUSA and WAWUSA are currently the

representative unions in the group.


Corporate Governance Report

The directors are committed to compliance with the

highest standards of corporate governance in terms of the

King II Report and shall in future also implement relevant

changes from the King III Report which became effective

from 1 March 2010. The group is compliant to the King II

Report. To achieve full compliance with the revised

King Code, the group has focused on improving and

codifying operational and corporate practices to implement

sound corporate governance, transparency, accountability

and integrity.

The directors appreciate the inextricable integration of the

group’s strategy, risk and sustainability into its daily

operations and endeavours to ensure that all three

components form part of all strategic decisions, audits and

assessments. In accordance with the King III Report’s

“apply or explain” approach, the board aims to state the

extent to which good governance principles have been

applied and explain any instances of non-compliance. Going

forward, the board will continue to monitor compliance to

ensure continuous improvement of operational and

corporate practices.

The boardAt year-end the unitary board comprised nine directors and

was chaired by independent non-executive director

MW von Wielligh. There is an equal balance of executive

directors, non-executive directors and independent non-

executive directors. The independence of directors is

assessed continuously and all of the group’s independent

directors meet the requirements of independence in terms of

King III. A checklist is currently being compiled to assist the

Remuneration and Nomination Committee in assessing the

board composition in terms of King III compliance.

Three changes to the board were made during the year.

M Kaplan retired as a non-executive director of the group and

chairman of the Audit Committee effective 19 August 2009.

Effective 8 October and 19 October 2009, respectively,

Dr LP Korsten was appointed as a non-executive director and

Ms PRE Tsukudu was appointed as an independent non-

executive director. At year-end the board therefore

comprised:

PG Corbin (executive director)

L Dotwana (non-executive director)

F du Toit (non-executive director)

LP Korsten (non-executive director)

PRE Tsukudu (independent non-executive director)

AJ van Heerden (CEO)

HJE van Wyk (independent non-executive director)

HP Verreynne (FD)

MW von Wielligh (independent non-executive Chairman)

The board meets at least four times a year with ad-hoc

meetings when necessary to review strategy, planning,

financial performance, resources, operations, risk, capital

expenditure, standards of conduct, transformation, diversity,

employment equity, human resources and environmental

management.


Corporate Governance Report (continued)

Directors’ attendance at board and committee meetings

between 1 March 2009 and 28 February 2010 is set out below.

Further indicated are directors, if not a committee member,

who attended the relevant meetings by invitation:

Further, non-executive directors hold separate meetings

four times a year to discuss the performance of the group

and of the executive directors.

In accordance with the group’s articles of association, one

third of the non-executive directors retire by rotation at every

annual general meeting and being eligible to stand, their

re-election is subject to shareholders’ approval. Accordingly

L Dotwana and F du Toit will retire at the upcoming annual

general meeting and being eligible, will stand for re-election.

Further the appointments of Dr LP Korsten and PRE Tsukudu

during the year are subject to confirmation by shareholders

at the forthcoming annual general meeting in line with the

articles of association (which states that all new directors

shall retire from office and shall be eligible for re-election by

shareholders at the first annual general meeting following

their appointment). The term of service for non-executive

directors is three years. A retiring director shall be eligible

for re-election.

The roles of Chairman and CEO, and likewise the

responsibilities of the remaining executive and non-executive

directors, are separated, ensuring that no individual director

can exercise unfettered powers of decision-making. The

Chairman provides leadership to the board and oversees

independent input into deliberations to ensure its efficient

operation while the CEO is responsible for the strategic

direction of Afrimat as well as ensuring that the day-to-day

affairs of the group are appropriately supervised and

controlled. Executive directors including the FD assist the

CEO and are responsible for implementing strategy and

operational decisions in respect of the company’s day-to-day

operations. The non-executive directors are not involved in

the daily operations of the group and are high merit individuals

who contribute a wide range of skills, knowledge and

experience to the board’s decision-making process.

Access to the advice and services of the company secretary

and to company records, information, documents and

property is unrestricted. Non-executive directors also have

unfettered access to the external auditors and to management

at any time. All directors are entitled, at Afrimat’s expense, to

seek independent professional advice on any matters

concerning the affairs of the group.

Afrimat board charterA formal Board Charter, which is currently under review to

incorporate improvements recommended by the King III

directorsAppointment date

Board meetings

Audit Committee

meetings

Remuneration and

Nomination Committee

meetings

Safety, Health and

Environment Committee

meetings

Non-executive directors’ meetings

PG Corbin 4 October 2006 4 (4) 1 (1) ◊ 2 (2)

L Dotwana*^ 4 October 2007 4 (4) 4 (4) 4 (4) 2 (2) 4 (4)

F du Toit* 4 October 2006 4 (4) 4 (4)

M Kaplan** (retired

19 August 2009) 2 (2) 2 (2) 1 (1) 2 (2)

LP Korsten* 8 October 2009 2 (2) 2 (2) 2 (2)

PRE Tsukudu** 19 October 2009 2 (2) 1 (1) 2 (2)

AJ van Heerden (CEO) 4 October 2006 4 (4) 4 (4) ◊ 4 (4) ◊ 2 (2)

HJE van Wyk**# 4 October 2006 4 (4) 4 (4) 4 (4)

HP Verreynne (FD) 1 October 2007 4 (4) 4 (4) ◊

MW von Wielligh**~(Chairman) 4 October 2006 4 (4) 4 (4) 4 (4) 2 (2) ◊ 4 (4)

#Audit Committee Chairman *Non-executive~Remuneration and Nomination Committee Chairman **Independent non-executive^SHE Committee Chairman ◊ Attended by invitation


Report, codifies the board’s composition, appointment,

authorities, responsibilities and processes and sets out the

fiduciary duty and role of each director to the company.

Responsibilities include:

• retaining full and effective control of the company;

• monitoring key risk areas and performance indicators of

the group’s business;

• approving the group’s strategic direction; and

• approving financial and non-financial objectives.

To assist the board in discharging its collective responsibility

of corporate governance, a Remuneration and Nomination

Committee, an Audit Committee and a SHE Committee have

been established to which certain board responsibilities are

delegated. An Executive Committee further assists the board

in this regard.

The board nonetheless undertakes to be ultimately

responsible and accountable to stakeholders for ethical

behaviour, compliance with the law and practice of good

corporate governance. The directors acknowledge that

delegation of certain responsibilities and functions does not

derogate from their responsibilities and duties.

The responsibility of assessing management’s performance

is supported by the Remuneration and Nomination

Committee, while the board is responsible for appointing the

CEO and monitoring the systems of internal control, the

latter with the assistance of the Audit Committee. New

directors are recommended for appointment by the

Remuneration and Nomination Committee in line with

corporate governance best practice.

The directors are cognisant that their challenge remains

balancing broader social objectives with performance in an

entrepreneurial market economy, within a framework of

governance principles in line with a global “triple-bottom

line” approach to corporate governance.

Board processesShare dealings and conflicts of interestDirectors are required to disclose their shareholdings,

additional directorships and any potential conflicts of interest

as well as any share dealings in the company’s securities to

the Chairman and company secretary for approval.

Non-executive directors are required to authorise the

Chairman’s share dealings prior to implementation. The

company secretary, together with the sponsor and FD,

ensures publication of share dealings on SENS.

In addition, all directors and the senior executives with access

to financial and any other price sensitive information are

prohibited from dealing in Afrimat shares during “closed

periods”, as defined by the JSE, or while the company is

trading under cautionary. The FD informs all directors by

email when the company enters a “closed period”.

New appointmentsNew board appointments are proposed and vetted by the

Remuneration and Nomination Committee taking into

account a blend of skills, experience and diversity. The

committee is responsible for making recommendations to

the full board for final approval in a formal and transparent

process.

The General Manager: Human Resources is responsible for

implementing a comprehensive induction programme for

new directors, which includes introductions to key senior

management and site visits. New appointees also receive

copies of the latest annual report, the latest interim

announcements, recent circulars to stakeholders, board

packs, details of the company’s structure and an overview of

the company’s accounting systems. The programme further

sets out the new directors’ responsibilities and fiduciary

duties, as well as advises on the relevant statutory and

regulatory framework and the JSE Listings Requirements.

In order to ensure maximum efficacy as early as possible

after appointment, the induction programme is extended to

new senior management. However, in this regard Afrimat

has maintained an impressive consistently low turnover

year-on-year.

Ongoing training and development of the board is considered

a priority. This process is spearheaded by the Chairman in

consultation with each director to identify gap areas and

ensure an adequate response thereto. During the year several

directors attended JSE courses specifically for directors and

the FD attended Companies Act and IFRS presentations. In

addition, the Chairman continually attends regular courses

at the Institute of Directors.



Self-evaluationA review of the board’s mix of skills, the contribution of

individual directors, the effectiveness of its sub-committees,

its performance and effectiveness as well as corporate

governance compliance is mandated to be conducted on an

annual basis. This is to ensure that the business is managed

ethically and within prudently determined risk parameters in

conformity with South African accepted standards of best

practice.

During the year the board conducted the annual self-

evaluation using a comprehensive checklist from the

independent external company secretary. Only minor

shortcomings were identified and corrective measures have

already been put in place after discussions at board level. The

board will continue to exercise leadership, integrity and

judgement, based on fairness, accountability, responsibility

and transparency.

The CEO’s performance was evaluated by the non-executive

directors and the Chairman’s, the FD’s and other executive

directors’ performance was evaluated by the CEO and the

Audit Committee assisted by the Remuneration and

Nomination Committee.

Succession planningA formal succession plan was introduced during the year. It

remains in the initial stages of implementation. Going forward

it is intended to be regularly reviewed and updated by the

Remuneration and Nomination Committee to ensure the

succession needs at senior executive and board levels are

met. Succession planning for the CEO remains the

responsibility of the Chairman assisted by the board.

The efficiency of the succession plan is reflected in the

ongoing advancement and promotion of staff through

management training.

Company secretarySheenagh Reynolds, representing Routledge Modise

Incorporated practicing as Eversheds, is the company

secretary. Sheenagh is an attorney with more than 13 years’

experience in the field of corporate governance.

The company secretary acts as advisor to the board and

notifies the directors of any relevant regulatory changes and

new developments in corporate governance. Whenever

deemed necessary she also reviews the rules and procedures

applicable to the conduct of the affairs of the board. Where

appropriate, the company secretary will involve the sponsor

and other experts in this regard to ensure that the directors

have adequate information to discharge their responsibilities

efficiently. She keeps record of, inter alia, shareholder

registers, meeting attendance registers, meeting minutes,

resolutions, directors’ declarations of personal interest(s)

and all notices and circulars issued by the group.

In liaison with the group’s sponsor, she further ensures

compliance by the group with all applicable corporate

regulations and legislation including the South African

Companies Act, 1973, as amended, and the King Codes of

Governance. New legislation is discussed at board meetings

and methods of implementation are instituted. In this regard

Afrimat, under the guidance of the company secretary,

completes an annual checklist of legislative and corporate

governance compliance. The potential impact of the new King

III Report has been assessed by the board.

Board committeesAll committees have satisfied their responsibilities during

the year in compliance with their formal Charters. The

chairmen of the committees or another committee member

nominated by them, attend the company’s annual general

meeting to answer any questions from shareholders

pertaining to the relevant matters addressed by their

respective committees. The Executive Committee comprises

the group’s three executive directors and the managing

directors of Blocks & Bricks (Jan van Heerden), Readymix

Concrete (Billy Paton) and Aggregates KwaZulu-Natal (Pieter

de Wet); Regional Manager: Aggregates North (Charl Marais);

General Manager: Human Resources (Anton Gerber); General

Manager: Business Development (Carl Malan) and newly

appointed Aggregates COO (Gert Coffee).

The Executive Committee oversees all operational aspects of

the business, ensuring that targets are met, deadlines are

achieved and potential risks are identified and addressed

timeously, and communicates the group’s policies to staff.

The committee is scheduled to meet six times a year with

frequent ad-hoc communication to ensure ongoing efficient

operations.


Audit CommitteeThe Audit Committee composition, duties and responsibilities

are set out in a separate Audit Committee Report on

page 20.

Remuneration and Nomination CommitteeThe committee is chaired by independent non-executive

group Chairman MW von Wielligh and comprises independent

non-executive director PRE Tsukudu and non-executive

director L Dotwana. The CEO and executive director

PG Corbin attend meetings by invitation and are excluded

from deliberations in respect of their own remuneration.

The committee met four times during the year as set out on

page 14.

During the year the Remuneration and Nomination Committee

Charter was reviewed by the board and the committee and

found to be fully effective. The Charter sets out the

committee’s roles and responsibilities including:

• setting the criteria for board nominations;

• identifying and recommending nominees to the board

(before nomination, appropriate background checks are

performed on proposed new directors);

• annually reviewing directors’ credentials;

• assessing executive remuneration; and

• determining short and long-term incentive pay structures

for group executives.

The committee determines, agrees and develops the general

remuneration policy for the CEO and executive directors for

approval by the board and recommends to the board the basic

salaries, benefits, annual bonuses, performance-based

incentives, share-based incentives, pensions and other

benefits paid to the directors.

The group’s remuneration policy is to pay market-related

salaries relevant to the geographical area and position held

taking into account employees’ qualifications, experience and

performance. Deloitte’s salary research is used as a

benchmark and external consultants, Compensation

Technologies, are also used. The administration of the

retirement funds is outsourced to ABSA who advises on

market trends in retirement benefits. Top executives’ salaries

are generally below those of its competitors and in the market

in general.

The board and committee member remuneration structure

consists of an annual base fee as set out in the table below:

Type of fee (per annum) Existing fee

2009/10

Proposed fee

2010/11R R

BoardChairman 363 000 392 000Non-executive director 97 000 105 000Audit CommitteeChairman 45 000 60 000Member 30 000 40 000Remuneration and Nomination CommitteeChairman 36 000 39 000Member 24 000 26 000SHE CommitteeChairman 28 000 31 000Member 18 000 20 000

Safety Health and Environmental (“SHE”) CommitteeThe SHE Committee is chaired by non-executive director

L Dotwana and further comprises the CEO AJ van Heerden

and executive director PG Corbin. Independent non-executive

group Chairman MW von Wielligh attends by invitation.

According to its terms of reference the committee is

tasked with:

• developing the framework policies and guidelines for

SHE management;

• reviewing the group’s SHE policies and their progressive

implementation by Afrimat and its subsidiaries;

• encouraging independently managed subsidiaries and

associates to develop policies, guidelines and practices

congruent with the group’s SHE policies;

• assessing reports relating to SHE risks and liabilities

from the group’s head office and subsidiaries;

• monitoring key indicators on accidents and incidents and

ensuring that such information is communicated to other

companies managed by or associated with Afrimat; and

• considering national and international regulatory and

technical developments and guidelines in the field of SHE

management.



The committee met twice during the year. Attendance at

meetings is set out in the table on page 14.

Accounting and auditingExternal auditThe independent external auditors, Mazars , as recommended

by the Audit Committee and appointed by the shareholders,

are responsible for reporting on whether the annual financial

statements are fairly presented in compliance with IFRS and

the Companies Act. The preparation of the annual financial

statements remains the responsibility of the directors.

The board, assisted by the Audit Committee, regularly meets

with the external auditors and evaluates their independence.

As a rule the board does not engage the external auditors for

any non-audit services, including tax compliance and

assisting with company secretarial duties. Where the external

auditors, as an exception, are appointed for non-audit

services, the board ensures that there is a strict separation of

divisions in order to maintain independence.

Internal auditAn Internal Audit Charter is in place with its own terms of

reference clearly defined and monitored by the Audit

Committee. Afrimat outsources the internal audit function to

KPMG, which reports directly to the CEO. KPMG’s access to

the Chairman of the board and the Audit Committee is

unrestricted.

Internal control and risk managementInternal controlThe importance of internal control systems and management

of risks is clearly communicated to all employees so that they

have a clear understanding of their roles and obligations in

this regard. Overall the board remains responsible for the

management of the internal control systems with the

assistance of the Audit Committee and the FD. Together they

evaluate the adequacy and effectiveness of internal control

systems and processes, and monitor whether internal control

recommendations made by the FD, external auditors and

internal auditors have been implemented.

There are inherent limitations to the effectiveness of any

system of internal control, including the possibility of human

error and the circumvention or overriding of controls. The

system is therefore designed to manage rather than

eliminate risk.

Nothing has come to the attention of the board to indicate

that there has been a material breakdown in the internal

systems of control during the year.

Risk managementAfrimat views the management of risk central to its

operational strategy of delivering sustained growth to

stakeholders. While the CEO and FD are the key drivers of

risk management, the Executive Committee and the Audit

Committee further assist with identifying, evaluating and

managing key risk areas and performance indicators of

Afrimat as well as the non-financial aspects relevant to the

group. The Audit Committee reviews the formal risk reports

on a quarterly basis and the risk register outlining the major

risks facing the group is updated bi-annually.

In terms of SHE risks HIRAs are based on the classification of

risks as to the degree of impact and probability of occurrence.

The board remains ultimately responsible for ensuring that

appropriate risk management procedures are in place, risk

areas are timeously addressed and risk policies are

communicated to staff.

Key risks currently facing the group are industry-related and

include:

Risk Risk mitigation

B-BBEE rating • Strategic focus with dedicated

team to improve B-BBEE rating

Theft and fraud • Strict internal controls

Volatile macro-

economic situation

• Aggressive search for new

expansion and diversification

opportunities

• Careful cost control

• Pre-emptive anticipation and

forecasting of market conditions

and proactive innovative solutions

ahead of occurrence to maintain

competitive advantage

Key staff turnover • Active management of internal

culture and climate

• Active involvement in leadership

mentoring and advancement

Liquidity

management

• Strict debtors control


are also posted to shareholders. The CEO regularly engages

with the financial media to ensure accurate reporting where

appropriate.

An open dialogue with shareholders and investors is

encouraged within the group.

Communication with institutional shareholders and

investment analysts is maintained through bi-annual

presentations of financial results, one-on-one interactions,

trading statements and press announcements, as well as

availability for ad-hoc meetings upon request.

Industry associationsAfrimat’s relevant subsidiaries are members of:

• ASPASA; and

• SARMA.

Code of ethics (“the Code”)The CEO is the driver of the group’s value system and is

further supported by business unit heads and HR

management. Every employee and director of Afrimat is

expected to subscribe to the Code, which sets out the

group’s commitment to best-practice corporate governance

at all times including transparent communications with all

stakeholders and procedures for avoiding conflicts of

interest and insider trading. In addition, the Code contains

guidelines on confidentiality, fair and ethical market

competition and sound environmental practices. Any

violation of the Code is considered a serious offence and is

dealt with accordingly. A whistleblowing process is in place

and any reported instances of non-adherence are

immediately investigated. No reports were made to the

whistleblowing response person during the year.

IT governanceThe Audit Committee, FD supported by two senior Business

Systems Managers and an IT Infrastructure Manager are

responsible for evaluating the security of computer systems

and applications, and for devising the contingency plans for

processing financial information in the event of a systems

breakdown.

Afrimat has in place a formal IT usage policy as well as an IT

and business systems strategy.

The IT Infrastructure Manager performs annual adherence

audits according to a checklist and then reports to the Audit

Committee on a quarterly basis.

New IT developments were introduced during the year to

minimise risk, increase operational efficiency and ensure

adequate IT governance, which included major projects to

replace sales/weighbridge systems for all quarries with

“Winbridge” software. Already at 90% complete, this software

program is showing the benefits of improvements in efficiency

and control. Further, Accpac ERP implementation to replace

all financial administration systems is scheduled to be

completed over the next two to three years.

Stakeholder communicationAfrimat is committed to timely, consistent and transparent

communication with all stakeholders and encourages an

open culture of communication throughout the group. Tools

such as quarterly staff newsletters, regular meetings with

unions and non-unionised employees and the group’s website

are used for internal communication.

The group encourages stakeholder attendance at annual

general meetings and where appropriate provides full and

comprehensive explanations of the effects of resolutions to

be proposed at these meetings.

Company announcements are released on SENS and posted

on the company’s website. Financial results announcements


Audit Committee Report

The information below constitutes the report of the Audit

Committee in respect of the past financial year of the

company, as required by section 270A of the Corporate Laws

Amendment Act.

The Audit Committee is chaired by independent

non-executive director HJE van Wyk and comprises

independent non-executive group Chairman MW von Wielligh

and non-executive directors L Dotwana and LP Korsten who

act independently.

Afrimat acknowledges that in accordance with new

legislation all members of the Audit Committee should

be non-executive directors who act independently, which

will be borne in mind when considering future board and

committee appointments. Presently membership of the Audit

Committee is based on the skills and experience available on

Afrimat’s board to ensure full efficacy and discharge of the

committee’s responsibilities. The committee met four times

during the year and attendance is set out in the table on page

14. The committee assists the board in fulfilling its review

and control responsibilities but has no executive powers.

During the year the Audit Committee Charter was reviewed

by the committee and the board and was deemed to be

adequate and effective. The Charter tasks the committee with

reviewing the interim and annual financial statements and

understanding management’s accounting processes and the

method by which it compiles financial information, as well as

the nature and extent of the external auditor’s involvement in

these processes. Additional responsibilities include:

• confirming and monitoring the internal audit process;

• monitoring internal control procedures including

accounting policies, legislative compliance, regulatory

matters and governance;

• recommending the appointment of external auditors,

who in the opinion of the committee are independent of

the company, for approval by shareholders at the annual

general meeting;

• approval of the remuneration of the external auditors and

assessment of their performance;

• performing an annual assessment of the independence

of the external auditors;

• setting the principles for recommending the use of

external auditors for non-audit purposes including

tax services, corporate restructuring and merger and

acquisition advice (any services or the extent thereof are

assessed to ascertain whether they are likely to conflict

with or impair their independence);

• determining the key risk areas facing the group and

recommending risk mitigation measures; and

• advising and updating the board on issues ranging from

accounting standards to published financial information.

The committee confirms that it is satisfied with the

independence of the group’s external auditors and the

respective audit partner. No non-audit services were provided

by the external auditors during the year.

As per the JSE Listings Requirements, the committee

considered and is satisfied with the appropriateness of the

expertise and experience of HP Verreynne as the group’s FD.

The Audit Committee is of the opinion that it has discharged

its functions in terms of its Charter and ascribed to it in

accordance with the requirements of the Corporate Laws

Amendment Act 24 of 2006.

HJE van WykAudit Committee Chairman

28 June 2010


Value Added Statement For the year ended 28 February 2010

Set out below is the wealth created by the group and its employees during the year under review and how it was applied.

2010 2009

R R

Revenue 778 015 852 687 090 781

Cost of services provided 483 760 150 418 918 172

Value added by operations 294 255 702 268 172 609

Non-operating income 6 807 619 4 521 552

Total value added 301 063 321 272 694 161

Applied as follows:

To remunerate employees:

- Salaries, wages, pensions, bonus and other benefits 146 671 862 135 904 070

To reward providers of capital:

- Dividends 19 334 514 28 112 815

- Interest on loans 12 959 655 13 222 654

To the State:

- Direct taxes 29 864 484 28 249 317

To replace assets:

- Depreciation 38 642 472 37 612 796

To expand the group

- Retained earnings 53 590 334 29 592 509

Total value added 301 063 321 272 694 161

22

directors’ Statement of Responsibility


The annual financial statements set out on pages 24 to 72 are the responsibility of the directors. The directors are responsible for selecting and adopting sound accounting practices, for maintaining an adequate and effective system of accounting records, for safeguarding assets and for developing and maintaining systems of internal control that, among other things, will ensure the preparation of annual financial statements that achieve fair presentation and have been prepared in accordance with IFRS. They are based on appropriate accounting policies which have been consistently applied, unless otherwise indicated, and which are supported by reasonable and prudent judgements and estimates.

The annual financial statements have been prepared on the going concern basis since the directors have every reason to believe that the company and the group have adequate resources in place to continue operations for the foreseeable future. The external auditors have concurred with the directors’ statement on going concern.

The external auditors are responsible for independently auditing and reporting on these annual financial statements in conformity with International Standards on Auditing.

The annual financial statements were approved by the board of directors and were signed on their behalf by:

AJ van Heerden HP VerreynneCEO Financial director

Cape Town28 June 2010

declaration by Company Secretary

I, Sheenagh Reynolds, declare that, to the best of my knowledge, the company has lodged with the Registrar of Companies all such returns as are required of a public company in terms of the South African Companies Act, 1973, and that all such returns are true, correct and up-to-date.

Sheenagh Reynolds Routledge Modise Incorporated practicing as Eversheds Company Secretary

Johannesburg28 June 2010

Annual Financial Statements For the year ended 28 February 2010

To the Members of Afrimat LimitedWe have audited the group annual financial statements and annual financial statements of Afrimat Limited, which comprise the consolidated and separate statements of financial position as at 28 February 2010, and the consolidated and separate income statements and the consolidated and separate statements of comprehensive income, changes in equity and cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes, and the directors’ report, as set out on pages 24 to 71.

Directors’ Responsibility for the Financial StatementsThe company’s directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act of South Africa. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, these financial statements present fairly, in all material respects, the consolidated and separate financial position of Afrimat Limited as at 28 February 2010, and its consolidated and separate financial performance and consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards, and in the manner required by the Companies Act of South Africa.

MazarsRegistered AuditorPartner: D DollmanRegistered AuditorCape Town28 June 2010


Report of the Independent Auditors


Directors’ ReportFor the year ended 28 February 2010

24

The directors of Afrimat Limited have pleasure in presenting their report for the group for the year ended 28 February 2010.

Nature of businessAfrimat is a black empowered supplier of construction materials to the building, construction, road building, railroad and mining sectors and industrial minerals industry. The group operates in the Western and Eastern Cape, KwaZulu-Natal, Free State, Gauteng, Limpopo, Mpumalanga and Namibia.

Financial resultsThe annual financial statements presented on pages 24 to 72 set out fully the financial position, results of operations and cash flows for the year.

Headline earnings grew by 30,3% to R70,4 million, translating into 26,7% higher headline earnings per share of 51,3 cents (2009: 40,5 cents).

Operational reviewThe operations are reviewed in detail in the CEO’s Report, which forms part of this annual report.

Accounting policiesDetailed accounting policies are set out on pages 34 to 44 of the annual financial statements.

DividendAn interim dividend of 6,0 cents (2009: 5,0 cents), amounting to R8,6 million (2009: R6,7 million), was declared and paid to the shareholders of Afrimat during the year under review. The board declared a final dividend of 10,0 cents per share (2009: 8, 0 cents) on 12 May 2010, amounting to R14,3 million (2009: R10,7 million) – a total dividend for the year of 16,0 cents per share (2009: 13,0 cents per share). Secondary tax on companies amounting to R1,4 million will be payable on the final dividend declared.

The salient dates for the dividend are as follows:Last day to trade cum dividend 28 May 2010Shares trade ex dividend 31 May 2010Record date Friday, 4 June 2010Payment date Monday, 7 June 2010

Authorised share capitalThe total authorised ordinary share capital at year-end was R10,0 million, consisting of 1 000 000 000 ordinary shares of 1 cent each with no change from the previous year.

Issued share capitalThe total issued ordinary share capital at year-end was R1 434 624, consisting of 143 262 412 ordinary shares (2009: R1 339 624 consisting of 133 762 412 ordinary shares). A total of 9 500 000 ordinary shares was issued to Afrimat Empowerment Investments (Pty) Limited for purposes of the Afrimat BEE Trust: Share Purchase Scheme for a purchase consideration of R27 075 000 (R2,85 per share).

Property, plant and equipmentThere has been no major change in the nature and use of property, plant and equipment during the year under review.

DirectorsThe directors of the company at the date of this annual report are set out below:

• PG Corbin (executive director)• L Dotwana (non-executive director)• F du Toit (non-executive director)• AJ van Heerden (CEO)• Dr LP Korsten (non-executive director)• PRE Tsukudu (independent non-executive director) • HJE van Wyk (independent non-executive director)• HP Verreynne (FD)• MW von Wielligh (independent non-executive Chairman)


25

During the year non-executive director M Kaplan retired from the board of directors effective 19 August 2009.

L Dotwana and F du Toit will retire at the upcoming annual general meeting and being eligible, will stand for re-election. Dr LP Korsten and PRE Tsukudu as newly appointed directors during the financial year are subject to re-election by shareholders at the annual general meeting.

Directors’ and officers’ interests in contractsNo material contracts in which directors have an interest were entered into during the year other than the transactions detailed in note 33 to the annual financial statements.

Directors’ emoluments and employment contractsDetails of directors’ emoluments are set out in note 35 to the annual financial statements. The fixed-term employment contracts for executive director PG Corbin and CEO AJ van Heerden will terminate on 6 November 2011.

Directors’ shareholding as at 28 February 2010:

Number of securities held

Direct IndirectPercentage

held (%)

Director BeneficiallyNon-

beneficially BeneficiallyNon-

beneficially

2010

PG Corbin 4 586 413 3,20

L Dotwana 4 210 701 2 ,94

F du Toit 19 788 502 13.81

LP Korsten 8 429 352 5,88

PRE Tsukudu –

M Kaplan (retired 19 August 2009) 160 000 0,11

AJ van Heerden 5 475 026 1 206 043 4,66

HJE van Wyk 112 000 0.08

HP Verreynne 100 000 0.07

MW von Wielligh 1 000 000 0.70

10 321 439 4 210 701 30 535 897 31,45

2009

PG Corbin 4 586 413 3,43

L Dotwana 6 210 701 4,64

F du Toit 19 748 502 14,77

M Kaplan (retired 19 August 2009) 160 000 0,12

AJ van Heerden 5 475 026 1 064 293 4,89

HJE van Wyk 112 000 0,08

HP Verreynne 100 000 0,07

MW von Wielligh 1 000 000 0,75

10 321 439 6 210 701 21 924 795 28,75

Between year-end and the date of this report no directors’ dealings took place.

Company secretaryRoutledge Modise Incorporated practicing as Eversheds, represented by Sheenagh Reynolds, remains the company secretary. The business and postal addresses are set out on the inside back cover of this annual report.

AuditorsMazars will continue in office as external auditors of the company in accordance with section 270(2) of the South African Companies Act, 1973 subject to shareholder approval at the upcoming Annual General Meeting.


Directors’ Report (continued)For the year ended 28 February 2010

26

AcquisitionsThe group acquired 66% of Blue Platinum Ventures 56 (Pty) Limited with effect from 1 July 2009.

The prior year the group acquired 100% of Sunshine Crushers (Pty) Limited with effect from 1 August 2008 as well as dormant companies Bechini Investments 73 (Pty) Limited from 3 November 2008 and Intshinga Mining (Pty) Limited from 28 February 2009. Amounts included are as follows:

2010 2009 Blue Sunshine Platinum Crushers R R

Carrying amounts of net assets– Property, plant and equipment 11 397 200 6 268 408 – Other (10 785 352) (3 910 745)

611 848 2 357 663

Fair value of assets– Property, plant and equipment 11 397 200 6 268 408 – Other (10 785 352) (3 910 745)

611 848 2 357 663

(Negative goodwill included in other income)/Goodwill (531 847) 5 723 351 Purchase consideration 80 001 8 081 014 (Loss)/profit after tax included in results (1 850 483) 1 092 756 Pro forma (loss)/profit after tax assuming business combinations for full year (3 972 682) 2 618 741 Revenue included in results 6 983 174 5 059 168 Pro forma revenue assuming business combinations for full year 8 981 415 9 755 434

DisposalsNo businesses were disposed of during the current year.

Business disposals during the prior year were 7,3% of Brickrush (Pty) Limited and 15% of AFT Aggregates (Pty) Limited.

2010 2009 7,3% 15% AFT Brickrush Aggregates R R R

Carrying amounts of net assets– Plant and equipment – 323 578 – – Other – 1 243 263 168 041

– 1 566 841 168 041

Fair value of assets– Plant and equipment – 323 578 – – Goodwill – 806 294 – – Other – 1 243 263 168 041

– 2 373 135 168 041

Proceeds on disposal – 3 833 960 168 041 Profit after tax included in results– Profit on disposal of businesses – 1 198 960 (23 526) – Profit after tax for period to disposal date – – 2 633

– 1 198 960 (20 893)


27

Corporate actions/B-BBEEAs announced on 31 August 2009 the Afrimat BEE Trust (“the Trust”) acquired 15,8% of Afrimat`s ordinary share capital – 22 700 000 Afrimat ordinary shares (“shares”) – to escalate direct black ownership in the group to 26,1% ahead of Mining Charter Requirements for 2014. Afrimat Empowerment Investments (Pty) Limited (“AEI”), an entity owned entirely by the Trust agreed to acquire 13 200 000 shares previously held by BEE shareholders, for a consideration of R35 904 000 (R2,72 per share) and subscribed for 9 500 000 new shares at a consideration of R27 075 000 (R2,85 per share).

Afrimat facilitated the transaction through the subscription of 1 000 redeemable cumulative participating preference shares in AEI for a total subscription price of R64 205 000. Afrimat intends to repurchase shares in order to reduce the dilutionary impact of the new shares being issued to AEI. At the date of this report 4 449 314 shares had been repurchased.

On 26 February 2010 the Trust acquired a further 1 350 000 shares from Joe Kalo Investments (Pty) Limited for a consideration of R4 239 000 (R3,14 per share). The total shares beneficially held by the Trust is 24 050 000 which is 16,8% of Afrimat’s ordinary share capital.

Interest in subsidiariesThe interest in subsidiaries is presented in note 5 to the annual financial statements. The interest of the holding company in the profits and losses of the subsidiaries, after taxation and profits attributable to non-controlling interests, is as follows:

2010 2009

R R

Profits 75 150 492 59 944 155

Losses (2 932 310) (2 097 006)

Special resolutionsA general authority was approved by the shareholders at the annual general meeting held on 29 July 2009 to acquire ordinary shares issued by the company, in terms of sections 85(2), 85(3) and 89 of the Companies Act and in terms of the Listings Requirements of the JSE.

BorrowingsIn terms of the articles of association the directors may exercise all the powers of the company to borrow money, as they consider appropriate.

Post-balance sheet eventFurther to the SENS announcement of 4 May 2010, post year-end the group acquired the entire issued share capital of Glen Douglas Dolomite (Pty) Limited from Exxaro Resources Limited for R35 million subject to the fulfilment of certain suspensive conditions. The purchase consideration will be financed from surplus cash and bank financing.

This acquisition is the first step in Afrimat’s expansion and diversification strategy into the industrial minerals sector. It is anticipated that this investment will realise positive growth for the group once Afrimat’s operational model is implemented that will unlock the vast potential of Glen Douglas over a realistic time horizon of three years.

28 June 2010


Statement of Financial PositionAt 28 February 2010

28

Group Company

2010 2009 2010 2009

Notes R R R R

AssetsNon-current assetsProperty, plant and equipment 2 385 261 260 382 539 041 1 368 676 1 161 876

Intangible assets 3 14 479 048 15 138 612 – –

Goodwill 4 101 331 899 101 331 899 – –

Investments in subsidiaries 5 – – 374 391 838 374 312 182

Investment in associate 6 5 549 – 147 –

Other financial assets 7 67 012 086 3 727 865 65 284 386 –

Deferred tax 20 4 569 767 – – –

Retirement benefit asset 9 12 671 745 11 792 354 – –

585 331 354 514 529 771 441 045 047 375 474 058

Current assetsInventories 10 68 861 850 75 402 311 – –

Loans to subsidiaries 5 – – 19 641 860 20 701 280

Current tax receivable 5 223 395 10 593 068 138 009 252 907

Trade and other receivables 11 130 956 272 132 367 525 5 077 620 16 748 418

Cash and cash equivalents 12 52 913 747 21 688 808 3 007 820 3 896 621

257 955 264 240 051 712 27 865 309 41 599 226

Total assets 843 286 618 754 581 483 468 910 356 417 073 284

Equity and liabilitiesEquityShare capital 13 1 434 624 1 339 624 1 432 624 1 337 624

Share premium 14 352 149 773 325 169 773 352 149 773 325 169 773

Business combination adjustment 14 (105 788 129) (105 788 129) – –

Treasury shares 15 (11 001 790) (4 119 601) – –

Net issued share capital 236 794 478 216 601 667 353 582 397 326 507 397

Reserves 17 1 834 547 2 259 701 762 196 925 644

Retained income 325 667 580 272 077 246 107 030 768 46 294 989

Attributable to equity holders of parent 564 296 605 490 938 614 461 375 361 373 728 030

Non-controlling interests 201 735 2 830 347 – –

Total equity 564 498 340 493 768 961 461 375 361 373 728 030

LiabilitiesNon-current liabilitiesBorrowings long-term 18 48 505 865 58 202 467 – –

Provisions 19 13 160 285 12 009 256 – –

Deferred tax 20 61 466 792 53 712 973 117 378 133 591

123 132 942 123 924 696 117 378 133 591

Current liabilitiesLoans from subsidiaries 5 – – 4 846 241 40 011 480

Borrowings short-term 18 43 364 590 42 919 233 – –

Current tax payable 158 565 7 306 778 – –

Trade and other payables 21 91 347 914 73 264 323 2 571 376 3 200 183

Bank overdraft 12 20 784 267 13 397 492 – –

155 655 336 136 887 826 7 417 617 43 211 663

Total liabilities 278 788 278 260 812 522 7 534 995 43 345 254

Total equity and liabilities 843 286 618 754 581 483 468 910 356 417 073 284


Income StatementFor the year ended 28 February 2010

29

Group Company

2010 2009 2010 2009

Notes R R R R

Revenue 22 778 015 852 687 090 781 17 663 677 16 937 381

Cost of sales (595 852 312) (525 376 664) – –

Gross profit 182 163 540 161 714 117 17 663 677 16 937 381

Other income 3 252 825 5 054 299 – 2 038 505

Operating expenses (76 492 616) (71 720 685) (16 986 455) (17 713 295)

Operating profit 23 108 923 749 95 047 731 677 222 1 262 591

Investment revenue 24 6 807 619 4 521 552 83 977 619 68 134 312

Finance costs 25 (12 959 655) (13 222 654) (2 440 400) (2 058 438)

Share of profit of associate 6 5 402 – – –

Profit before taxation 102 777 115 86 346 629 82 214 441 67 338 465

Taxation 26 (29 864 484) (28 249 317) (2 181 924) (3 772 825)

Profit for the year 72 912 631 58 097 312 80 032 517 63 565 640

Attributable to:

Owners of the parent 72 911 082 57 702 852 80 032 517 63 565 640

Non-controlling interests 1 549 394 460 – –

72 912 631 58 097 312 80 032 517 63 565 640

Earnings per ordinary share (cents) 53,1 43.2 – –

Diluted earnings per ordinary share (cents) 52,7 43.2 – –


Statement of Comprehensive IncomeFor the year ended 28 February 2010

30

Group Company

2010 2009 2010 2009

Notes R R R R

Profit for the year 72 912 631 58 097 312 80 032 517 63 565 640

Other comprehensive incomeNet change in fair value of available-for-sale

financial assets 220 013 (279 993) – –

Income tax effect (27 357) 32 623 – –

Net change in fair value of available-for-sale

financial assets transferred to profit and loss (668 942) – – –

Income tax effect 204 294 – – –

(271 992) (247 370) – –

Total comprehensive income for the year 72 640 639 57 849 942 80 032 517 63 565 640

Attributable to:

Owners of the parent 72 639 090 57 455 482 80 032 517 63 565 640

Non-controlling interests 1 549 394 460 – –

72 640 639 57 849 942 80 032 517 63 565 640


Statement of Changes in EquityFor the year ended 28 February 2010

31

Share capital

R

Share premium

R

Treasury shares

R

Business combination adjustment

R

Otherreserves

R

Retained income

R

Non-controlling

interestsR

Total equity

R

GroupBalance at 1 March 2008 1 339 627 326 115 905 (886 648) (105 788 129) 934 981 242 484 737 700 947 464 901 420

Changes:

Disposal equity adjustments – – – – (2 372) 2 472 1 734 940 1 735 040

Issue/(Cancellation) of shares (3) – – – – – – (3)

Premium/(Adjustment) on shares issued – (946 132) – – – – – (946 132)

Employee share option scheme:

– Value of services provided – – – – 1 574 462 – – 1 574 462

Movement in treasury shares – – (3 232 953) – – – – (3 232 953)

Total comprehensive income for the year – – – – (247 370) 57 702 852 394 460 57 849 942

Dividends paid – – – – – (28 112 815) – (28 112 815)

Total changes (3) (946 132) (3 232 953) – 1 324 720 29 592 509 2 129 400 28 867 541

Balance at 28 February 2009 1 339 624 325 169 773 (4 119 601) (105 788 129) 2 259 701 272 077 246 2 830 347 493 768 961

Changes:

Acquisition equity adjustments – – – – – 13 766 (2 630 161) (2 616 395)

Issue of shares 95 000 – – – – – – 95 000

Premium on shares issued – 26 980 000 – – – – – 26 980 000


– Value of services provided – – – – (153 162) – – (153 162)

Movement in treasury shares – – (6 882 189) – – – – (6 882 189)

Total comprehensive income for the year – – – – (271 992) 72 911 082 1 549 72 640 639

Dividends paid – – – – – (19 334 514) – (19 334 514)

Total changes 95 000 26 980 000 (6 882 189) – (425 154) 53 590 334 (2 628 612) 70 729 379

Balance at 28 February 2010 1 434 624 352 149 773 (11 001 790) (105 788 129) 1 834 547 325 667 580 201 735 564 498 340


Statement of Changes in Equity (continued)For the year ended 28 February 2010

32

Share capital

R

Share premium

R

Treasury shares

R

Business combination adjustment

R

Otherreserves

R

Retained income

R

Non-controlling

interestsR

Total equity

R

CompanyBalance at 1 March 2008 1 337 627 326 115 905 – – 92 500 10 819 380 – 338 365 412

Changes:

Issue/(Cancellation) of shares (3) – – – – – – (3)

Premium/(Adjustment) on shares issued – (946 132) – – – – – (946 132)


– Value of services provided – – – – 833 144 – – 833 144

Total comprehensive income for the year – – – – – 63 565 640 – 63 565 640

Dividends paid – – – – – (28 090 031) – (28 090 031)

Total changes (3) (946 132) – – 833 144 35 475 609 – 35 362 618

Balance at 28 February 2009 1 337 624 325 169 773 – – 925 644 46 294 989 – 373 728 030

Changes:

Issue of shares 95 000 – – – – – – 95 000

Premium on shares issued – 26 980 000 – – – – – 26 980 000


– Value of services provided – – – – (163 448) – – (163 448)

Total comprehensive income for the year – – – – – 80 032 517 – 80 032 517

Dividends paid – – – – – (19 296 738) – (19 296 738)

Total changes 95 000 26 980 000 – – (163 448) 60 735 779 – 87 647 331

Balance at 28 February 2010 1 432 624 352 149 773 – – 762 196 107 030 768 – 461 375 361


Statement of Cash FlowsFor the year ended 28 February 2010

33

Group Company

2010 2009 2010 2009

Notes R R R R

Cash flows from operating activitiesCash generated from operations 27.1 166 491 065 119 478 763 12 128 398 (16 810 312)

Interest income 6 802 963 4 495 435 5 337 619 3 167 572

Dividends received 4 656 26 117 16 000 000 26 935 570

Finance costs (12 959 655) (13 222 654) (2 440 400) (2 058 438)

Tax paid 27.2 (25 581 434) (38 190 527) (2 083 239) (4 804 761)

Net cash from operating activities 134 757 595 72 587 134 28 942 378 6 429 631

Cash flows from investing activitiesAcquisition of property, plant and equipment 2 (38 086 550) (122 269 300) (779 208) (1 107 272)

Proceeds on sale of property, plant and equipment 10 171 095 21 742 452 – –

Acquisition of businesses 29 (14 261) (7 802 995) (80 001) (8 081 014)

Proceeds on sale of businesses 30 – 4 002 000 – 4 002 000

Acquisition of associate (147) – (147) –

Loans received – – 28 534 301 28 772 536

Purchase of financial assets (35 989 208) (29 524) (38 209 386) –

Net cash from investing activities (63 919 071) (104 357 367) (10 534 441) 23 586 250

Cash flows from financing activitiesProceeds on share issue/(Shares cancelled) 27.3 – (3) – (3)

Proceeds and premium/(adjustment) on shares issued 27.4 – (946 132) – (946 132)

Purchase of treasury shares (6 882 189) (3 232 953) – –

Proceeds from borrowings 30 509 243 89 897 197 – –

Repayment of borrowings (51 292 900) (55 109 139) – –

Dividends paid 28 (19 334 514) (28 112 815) (19 296 738) (28 090 031)

Net cash from financing activities (47 000 360) 2 496 155 (19 296 738) (29 036 166)

Total cash movement for the year 23 838 164 (29 274 078) (888 801) 979 715

Cash at the beginning of the year 8 291 316 37 565 394 3 896 621 2 916 906

Total cash at the end of the year 12 32 129 480 8 291 316 3 007 820 3 896 621


Notes to the Annual Financial StatementsFor the year ended 28 February 2010

34

Presentation of annual financial statementsThe annual financial statements have been prepared in accordance with International Financial Reporting Standards and the Companies Act of South Africa. The annual financial statements have been prepared using a combination of the historical cost and fair value basis of accounting. Those categories to which the fair value basis of accounting has applied are indicated in the individual accounting policy notes below.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the group’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the consolidated financial statements, are disclosed in note 1.18.

The principal accounting polices are set out below. These accounting polices are consistent with the previous year, unless otherwise stated.

1. Accounting policies1.1 Business combination

Prima, a subsidiary, was regarded as the acquirer for accounting purposes in terms of IFRS 3. Consequently the group consolidated financial statements represent a continuation of the financial statements of the legal subsidiary.

(a) Basis of consolidationGroup financial statementsThe group financial statements comprise the consolidated financial statements of the company and its subsidiaries. The financial statements of the subsidiaries are prepared for the same reporting period as the parent company, using consistent accounting policies.

Subsidiaries are all entities (including special purpose entities) over which the group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the group. They are deconsolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries by the group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. The excess of the cost of acquisition over the fair value of the group’s share of the identifiable net assets acquired is recorded as goodwill.

Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated but considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group.

Company financial statementsInvestments in subsidiaries are initially recognised at cost. The cost of an investment in subsidiary is the aggregate of the fair value, at the date of exchange, of assets given, liabilities incurred or assumed, equity instruments issued and the direct costs attributable to the acquisition of the subsidiary.

Investments in subsidiaries are subsequently measured at cost less any accumulated impairment.

(b) Non-controlling interestsNon-controlling shareholders’ interests included on the statement of financial position represent the portion of profit or loss and net assets in subsidiaries not held by the group. Non-controlling interests are presented separately in profit or loss and within equity in the consolidated statement of financial position.

The group applies a policy of treating transactions with non-controlling interests as transactions with parties external to the group. Disposals to non-controlling interests results in gains and losses for the group and are recorded in the income statement. Purchases from non-controlling interests result in goodwill, being the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary.

(c) AssociatesAssociates are all entities over which the group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost. The group’s investment in associates includes goodwill identified on acquisition, net of any accumulated impairment loss. See note 1.9 for the impairment of non-financial assets including goodwill.


35

The group’s share of its associates’ post-acquisition profits or losses is recognised in the income statement, and its share of post-acquisition movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

Unrealised gains on transactions between the group and its associates are eliminated to the extent of the group’s interest in the associates. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where necessary to ensure consistency with the policies adopted by the group. Dilution gains and losses arising in investments in associates are recognised in the income statement.

(d) Share trustsThe group consolidates the Afrimat BEE Trust and the Afrimat Share Incentive Trust.

1.2 Property, plant and equipmentProperty, plant and equipment is initially recognised at cost. The cost of property, plant and equipment includes amounts incurred initially to acquire or construct an item of property, plant and equipment and amounts incurred subsequently to add to or replace part of the asset. If a replacement cost is recognised in the carrying amount of an item of property, plant and equipment, the carrying amount of the replaced part is derecognised. Day-to-day servicing costs, such as labour and consumables, are expensed in the income statement as repairs and maintenance.

The cost of an item of property, plant and equipment includes the initial estimate of the cost of dismantling and removing the asset and restoring the site on which it is located. When this initial estimate of costs is included in the cost of the item of property, plant and equipment, a corresponding provision is created for the obligation. The initial estimate of the expenditure required to settle the present obligation is determined using a current market-based discount rate.

Property, plant and equipment are subsequently measured at cost less accumulated depreciation and any accumulated impairment losses.

Depreciation is provided on all property, plant and equipment other than freehold land, to write down the cost, less residual value, on the straight-line basis over their useful lives as follows:

Leasehold property 10 to 50 yearsPlant and machinery 5 to 20 yearsMotor vehicles 3 to 10 yearsOffice equipment 3 to 5 years

Where a part of an item of property, plant and equipment is significant in relation to the cost of the item, that part is depreciated separately. The depreciation charge for each period is recognised as an expense in the income statement.

The residual values, useful lives and depreciation methods applied to property, plant and equipment are reviewed, and adjusted if necessary, on an annual basis. These changes are accounted for as a change in estimate.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal.

The gain or loss arising from the derecognition of an item of property, plant and equipment is included in the income statement and is calculated as the difference between the net disposal proceeds, if any, and the carrying amount of the item at the date of derecognition.

1.3 GoodwillGoodwill arises from business combinations and is initially measured at cost. Cost represents the excess of the purchase consideration over the fair value of the group’s share of the identifiable assets, liabilities and contingent liabilities acquired at the date of the acquisition.

Subsequently, goodwill is carried at cost less any accumulated impairment.

Where the fair value of the group’s share of the identifiable assets, liabilities and contingent liabilities acquired in a business combination is greater than the cost of the combination, the difference is recognised in the income statement immediately.

Goodwill is reviewed for impairment annually, or more frequently if events or changes in circumstances indicate that the carrying amount may be impaired.


Notes to the Annual Financial Statements (continued)For the year ended 28 February 2010

36

At the acquisition dates, goodwill is allocated to each of the cash-generating units expected to benefit from a business combination. Impairment is determined by assessing the recoverable amount of the cash-generating unit to which goodwill relates. The recoverable amount is determined as the value in use of each cash-generating unit by estimating the expected future cash flows in each unit and choosing a suitable discount rate in order to calculate the present value of those cash flows.

Where the recoverable amount of the cash-generating unit is less than the carrying amount of the unit, an impairment loss is recognised in the income statement beginning with the write off of the goodwill allocated to such cash-generating unit. Where the goodwill is insufficient to cover the amount of the impairment adjustment, the remaining assets in the cash-generating unit are impaired on a prorata basis.

An impairment loss recognised for goodwill is not subsequently reversed.

1.4 Intangible assetsIntangible assets are initially recognised at cost.

Where an intangible asset is acquired in a business combination, the cost of that intangible asset is its fair value at the acquisition date.

Intangible assets are subsequently measured at cost less accumulated amortisation and any accumulated impairment losses.

For all intangible assets, amortisation is provided on the straight-line basis so to write down the cost of the intangible assets, less their residual values, on the straight-line basis over their useful lives estimated to be between 20 to 30 years.

The amortisation charge is recognised as an operating expense in the income statement. The amortisation period and amortisation method applied to an intangible asset with a finite useful life is reviewed, and adjusted if necessary, on an annual basis. These charges are accounted for as a change in estimate.

Where the recoverable amount is less than the carrying amount of the assets or the cash-generating unit, an impairment loss is recognised in the income statement.

The useful life of an intangible asset with a finite life is reviewed annually to determine whether the finite life assessment continues to be supportable. If not, the change in the useful life assessment is made prospectively.

Intangible assets are derecognised upon disposal or when no future economic benefits are expected from its use or disposal. The gain or loss arising from the derecognition on an intangible asset is included in the income statement and is calculated as the difference between the net disposal proceeds, if any, and the carrying amount of the asset at the date of derecognition.

1.5 Financial instrumentsInitial recognitionFinancial instruments carried on the statement of financial position include cash and bank balances, investments, trade and other receivables, trade and other payables, and borrowings.

The group classifies financial instruments, or their component parts, on initial recognition as a financial asset, a financial liability or an equity instrument in accordance with the substance of the contractual arrangement.

Financial assets and financial liabilities are recognised on the group’s statement of financial position when the group becomes party to the contractual provisions of the instrument.

Financial assetsThe group classifies its financial assets in the following categories: at fair value through profit or loss; available-for-sale; and loans and receivables. The classification is dependent on the purpose for which the financial assets were acquired. Management determines the classification of financial assets at the time of the purchase and re-evaluates such designation at every reporting date.

Available-for-sale financial assetsAvailable-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the reporting date.


Regular purchases and sales of financial assets are recognised on the trade date – the date on which the group commits to purchase or sell the asset. Investments are initially recognised at fair value plus transaction costs. Financial assets are derecognised when the rights to receive cash flows from the investment have expired or have been transferred and the group has transferred substantially all risks and rewards of ownership. Available-for-sale financial assets are subsequently carried at fair value with changes in fair value recognised in equity.

When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the income statement through a reclassification adjustment. The fair values of quoted investments are based on current bid prices. If the market for available-for-sale assets is not active, the group uses discounted cash flow analyses to calculate the fair value.

Financial assets at fair value through profit or lossFinancial assets at fair value through profit or loss are financial assets held-for-trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term. Assets in this category are classified as current assets.

The fair values of quoted investments are based on current bid prices. Gains or losses arising from changes in the fair value of the “Financial assets at fair value through profit or loss” category are presented in the income statement in the period in which they arise. Dividend income from financial assets at fair value through profit or loss is recognised in the income statement when the group’s right to receive payment is established.

Loans and receivablesLoans and receivables are non-derivative assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after reporting date.

Loans and receivables are carried at amortised cost using the effective interest rate method. Interest on loans and receivables are calculated using the effective interest method and recognised in the income statement.

Impairment of financial assetsThe group assesses at each reporting date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is considered as an indicator that the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement. Impairment testing of trade receivables is disclosed under trade receivables.

If there is objective evidence that an impairment loss on loans or receivables carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the loan or receivable’s original effective interest rate. This impairment loss is recognised in the income statement.

Trade and other receivablesTrade receivables are initially recognised at fair value, being the original invoice amount, and subsequently carried at amortised cost. An allowance for estimated irrecoverable amounts is recognised in the income statement when there is objective evidence that the asset is impaired. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments are considered indicators that the trade receivables are impaired. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the income

statement within operating expenses. When a trade receivable is uncollectible, it is written off against the allowance

account for trade receivables. Subsequent recoveries of amounts previously written off are credited against operating expenses in the income statement.

Cash and cash equivalentsCash and cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to insignificant risk in change in value; these are initially and subsequently recorded at fair value.



For purposes of the statement of cash flows, cash and cash equivalents comprise cash and cash equivalent defined above, net of outstanding bank overdrafts.

Bank overdrafts and borrowingsBank overdrafts and borrowings are initially measured at fair value, which is the cash consideration received less transaction costs. Subsequently, bank overdrafts and borrowings are measured at amortised cost using the effective interest rate method. The amortised cost method results in the accrual of interest in each period by applying the effective interest rate implicit to the outstanding balance on the borrowings. Borrowings are reduced when repayments are made.

Share capitalShare capital issued by the company is recorded at the proceeds received, net of issue costs.

Where any group company purchases the company’s equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs (net of income taxes) is deducted from equity attributable to the company’s equity holders until the shares are cancelled or reissued. Where such shares are subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity attributable to the company’s equity holders.

Trade and other payablesTrade and other payables are initially recognised at fair value, being the original invoice amount. Subsequently trade and other payables are carried at amortised cost using the effective interest method.

1.6 InventoriesInventories are measured at lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale.

The cost of inventories comprises all costs of purchase, cost of conversion and other costs incurred in bringing the inventories to their present location and condition.

The cost of the inventories is assigned using the first-in, first-out (“FIFO”) formula. The same cost formula is used for all inventories having similar nature and use to the entity. The cost of consumable stores is determined on the weighted average basis.

When inventories are sold, the carrying amount of those inventories is recognised as an expense in the period in which the related revenue is recognised. The amount of any write-down of inventories to net realisable value and all losses of inventories are recognised as an expense in the period the write-down or loss occurs. The amount of any reversal of any write-down of inventories, arising from an increase in net realisable value, is recognised as a reduction in the amount of inventories recognised as an expense in the period in which the reversal occurs.

1.7 TaxCurrent tax assets and liabilitiesCurrent tax for current and prior periods is, to the extent unpaid, recognised as a liability. If the amount already paid in respect of current and prior periods exceeds the amount due for those periods, the excess is recognised as an asset.

Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the tax authorities, using the tax rates (tax laws) that have been enacted or substantively enacted by the reporting date.

Deferred tax assets and liabilities

A deferred tax liability is recognised for all taxable temporary differences, except to the extent that the deferred tax liability arises from:

– the initial recognition of goodwill; or

– the initial recognition of an asset or liability in a transaction which:

– is not a business combination; and

– at the time of the transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax liability is recognised for all taxable differences associated with investments in subsidiaries, branches and associates, and interest in joint ventures, except to the extent that both the following conditions are satisfied:

– the parent, investor or venturer is able to control the timing of the reversal of the temporary difference; and

– it is probable that the temporary difference will not reverse in the foreseeable future.


A deferred tax asset is recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary difference can be utilised, unless the deferred tax asset from the initial recognition of an asset or liability in a transaction that:

– at the time of transaction, affects neither accounting profit nor taxable profit (tax loss).

A deferred tax asset is recognised for all deductible temporary differences arising from investment in subsidiaries, branches and associates, and interests in joint ventures, to the extent that it is probable that:

– the temporary difference will reverse in the foreseeable future; and

– taxable profit will be available against which the unused tax losses and unused secondary tax on companies credits can be utilised.

A deferred tax asset is recognised for the carry forward of unused tax losses and unused secondary tax on companies credits to the extent that it is probable that future taxable profit will be available against which the unused tax losses and unused secondary tax on companies credits can be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantially enacted by the reporting date.

The measurement of deferred tax assets and liabilities reflect the tax consequences that would follow from the manner in which the group expects to recover or settle the carrying amounts of its assets and liabilities at the reporting date.

Deferred tax assets and liabilities are offset for presentation in the statement of financial position where the company has a legally enforceable right to do so and the income taxes relate to the same tax authority.

Therefore, deferred tax assets and deferred tax liabilities arising in the group financial statements from different subsidiaries are not offset because there is no allowance in South African tax law that allows income tax from different entities to be offset.

Tax expenseCurrent and deferred taxes are recognised as income or an expense and included in the income statement, except to the extent that the tax arises from:

– a transaction or event which is recognised, in the same or a different period, directly in equity, or a business combination.

Current tax and deferred taxes are charged or credited to equity if the tax relates to items that are credited or charged, in the same or different period, directly to equity.

The current tax payable is based on taxable profit. Taxable profit differs from profit reported in the income statement when there are items of income or expense that are taxable or deductible in other years and it also excludes items that are never taxable or deductible under existing tax legislation.

Secondary taxation on companies is provided in respect of declared dividends, net of dividends received or receivable, and is recognised as a taxation charge in the income statement in the year the related dividend is declared.

1.8 Leases as lessee and instalment purchase agreementsA lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership. A lease is classified as an operating lease if it does not transfer substantially all the risks and rewards incidental to ownership.

Instalment purchase agreements are recognised as assets and liabilities in the statement of financial position at amounts equal to the fair value of the financed asset or, if lower, the present value of the minimum instalment payments. The corresponding liability to the lessee is included in the statement of financial position as borrowings.

The discount rate used in calculating the present value of the minimum instalment payments is the interest rate implicit in the instalment purchase agreement.

The instalment purchase payments are apportioned between the finance charge and reduction of the outstanding liability. The finance charge is allocated to each period during the lease term so as to produce a constant periodic rate on the remaining balance of the liability.



Assets held under instalment purchase agreements are depreciated over their expected useful lives on the same basis as owned assets.

Operating lease payments are recognised as an expense on a straight-line basis over the lease term. The difference between the amounts recognised as an expense and the contractual payments are recognised as an operating lease liability. This liability is not discounted.

Contingent rentals are not accounted for on a straight-line basis, but are expensed in the income statement in the period in which they occur.

1.9 Impairment of non-financial assetsThe company assesses at each reporting date whether there is any indication that an asset may be impaired. If any such indication exists, the company estimates the recoverable amount of the individual asset.

If it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash-generating unit to which the asset belongs is determined. The recoverable amount of an asset or cash-generating unit is the higher of its fair value less costs to sell and its value in use.

In assessing value in use the estimated cash flows are discounted to their present value using a pre-tax discount rate that reflects the current market assessment of the time value of money and the risks specific to the asset or to the cash-generating unit. If the recoverable amount of an asset is less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. That reduction is an impairment loss.

An impairment loss is recognised for cash-generating units if the recoverable amount of the unit is less than the carrying amount of the unit. The impairment loss is allocated to reduce the carrying amount of the assets of the unit in the following order:

– First to reduce the carrying amount of any goodwill allocated to the cash-generating unit, – and then to the other assets of the unit, pro rata on the basis of the carrying amount of each asset in the unit.

Irrespective of whether there is any indication of impairment, the company also tests intangible assets with an indefinite useful life and goodwill acquired in a business combination for impairment annually by comparing its carrying amount with its recoverable amount. This impairment test is performed annually at the same time every year.

The accounting policy that deals with the impairment of intangible assets with an indefinite useful life and goodwill are included in the respective accounting policy notes for those assets.

1.10 Employee benefitsShort-term employee benefitsThe cost of short-term employee benefits, (those payable within 12 months after the service is rendered, such as paid vacation leave and sick leave, bonuses, and non-monetary benefits such as medical care), are recognised in the period in which the service is rendered and are not discounted.

The expected cost of compensated absences is recognised as an expense as the employee renders service that increases their entitlement or, in the case of non-accumulating absences, when the absence occurs.

The expected cost of profit sharing and bonus payments is recognised as an expense when there is a legal constructive obligation to make such payments as a result of past performance.

Share-based compensationThe group operates a number of equity-settled, share-based compensation plans. The fair value of the employee services received in exchange for the grant of the options is recognised as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the options granted, excluding the impact of any non-market vesting conditions. Non-market vesting conditions are included in assumptions about the number of options that are expected to vest. At each reporting date, the entity revises its estimates of the number of options that are expected to vest. It recognises the impact of the revision to original estimates, if any, in the income statement, with a corresponding adjustment to equity.

The proceeds received net of any directly attributable transaction costs are credited to share capital (nominal value) and share premium when the options are exercised.

Defined contribution plansPayments to defined contribution retirement benefit plans are charged as an expense as they fall due.


Defined benefit plansFor defined benefit plans the cost of providing the benefits is determined using the projected unit credit method. Actuarial valuations are conducted annually by independent actuaries separately for each plan. Consideration is given to any event that could impact the funds up to reporting date where the interim valuation is performed at an earlier date.

Past service costs are recognised immediately to the extent that the benefits are already vested, and are otherwise amortised on a straight-line basis over the average period until the amendment benefits become vested.

To the extent that, at the beginning of the financial year, any cumulative unrecognised actuarial gain or loss exceeds 10% of the greater of the present value of the projected benefit obligation and the fair value of the plan assets (the corridor), that portion is recognised in the income statement over the expense average remaining service lives of participating employees. Actuarial gains or losses within the corridor are not recognised.

Funding shortfalls arising in the defined benefit plan are met by the company through lump sum payments or an increase in the future rate of the company’s and/or employees’ contributions or a reduction in future benefits or any other combination of these alternatives.

The amount recognised in the statement of financial position represents the present value of the defined benefit obligation as adjusted for unrecognised actuarial gains and losses and unrecognised past service cost, and reduced by the fair value of plan assets.

Any asset is limited to unrecognised actuarial losses, plus the present value of available refunds and reduction in future contributions to the plan.

1.11 ProvisionsProvisions are recognised when the group has a present obligation as a result of a past event and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the obligation.

The amount of a provision is the present value of the expenditure expected to be required to settle the obligation. Provisions are reviewed annually to reflect current best estimates of the expenditure required to settle the obligation.

Where some or all of the expenditure required to settle a provision is expected to be reimbursed by another party, the reimbursement shall be recognised when, and only when, it is virtually certain that reimbursement will be received if the entity settles the obligation. The reimbursement shall be treated as a separate asset. The amount recognised for the reimbursement shall not exceed the amount of the provision.

1.12 RevenueRevenue from the sale of goods is recognised when the significant risks and rewards of ownership are transferred to the buyer. Revenue is measured at the fair value of the consideration received or receivable, which is represented by the invoiced amount excluding value added tax, trade discounts and volume rebates.

Revenue arising from the rendering of services is recognised when the outcome of the transaction can be estimated reliably by reference to the stage of completion of the transaction. Revenue is measured at the fair value of the consideration received or receivable, excluding value added tax and trade discounts.

Dividends are recognised in profit or loss when the company’s right to receive payment has been established. This normally coincides with the date of declaration of the dividend.

Interest revenue is recognised in profit or loss using the effective interest rate method.

1.13 Accounting for BEE transactionsWhere equity instruments are issued to a BEE party at less than fair value, these are accounted for as share-based payments in terms of IFRS 2: Share-based payments, IFRIC 8: Scope of IFRS 2 and AC 503: Accounting for Black Economic Empowerment transactions.

1.14 Foreign currency transactionsThe consolidated financial statements are presented in South African Rand which is the company’s functional and presentation currency. Translation of operations conducted in Namibia due to the fixed exchange rate, do not result in translation gains or losses.



1.15 Borrowing costsThe group capitalises borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. Other borrowing costs are recognised as an expense in the period in which they are incurred.

1.16 Decommissioning and quarry rehabilitationGroup companies are required to restore quarry and manufacturing sites at the end of their productive lives to a condition acceptable to the relevant authorities.

The expected cost of any decommissioning programme, discounted to its net present value, has been capitalised at current date and amortised over the estimated remaining useful life of the asset. The increase or decrease in the net present value of the expected cost is included in finance costs.

The expected increase or decrease in the cost of any rehabilitation programme, discounted to its net present value, is charged as an expense in the year in which the increase or decrease occur and is included in cost of sales. The increase or decrease in the net present value of the expected cost is included in finance costs.

1.17 Segment informationThe principal segments of the group have been identified on a primary basis by business segment. The basis is representative of the internal structure used for management reporting to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the executive committee.

Segment revenue reflects both sales to external parties and inter-group transactions across segments. The segment result is presented as segment profit before net finance costs and taxation.

Segment operating assets and liabilities are only those items that can be specifically identified within a particular segment.

1.18 Significant accounting judgements and estimatesIn the process of applying the group’s accounting policies, management has not made any judgements, apart from those involving estimations, which have a significant effect on the amounts recognised in the financial statements.

Property, plant and equipmentThe useful lives and residual values of items of property, plant and equipment are assessed annually in order for depreciation to be provided. The actual lives and residual values of assets may vary depending on several factors. Consideration has to be given to whether subsequent expenditure is to be treated as maintenance or to be capitalised.

Trade and other receivablesImpairment of trade and other receivables requires the consideration of the impairment indicators, namely significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation and default or delinquency in payments.

Decommissioning and rehabilitation provisions Quantifying the future costs of these obligations is complex and requires various estimates to be made thereof, as well as interpretations of and decisions regarding regulatory requirements, particularly with respect to the degree of rehabilitation required, with reference to the sensitivity of the environmental area surrounding the sites. Consequently, the guidelines issued for quantifying the future rehabilitation cost of a site, as issued by the Department of Mineral Resources, have been used to estimate future rehabilitation costs. Management has also contracted independent consultants to estimate the amount of provisions required.

Impairment of goodwillGoodwill has been allocated to cash-generating units. The carrying value of goodwill is assessed using a discounted methodology based on forecasts including assumptions on operating profit, depreciation, working capital movements and capital expenditure. Refer note 4 for assumptions used.

Amortisation of intangible assetsThe best estimate of the useful life of mining rights is used in assessing the period over which the group amortises mining rights.

Share-based payment expense calculationThe group uses the Black Scholes valuation model to determine the fair value of the options granted. The significant inputs into the model are disclosed in the note 16.


Provision for stock obsolesenceThe group recognised a provision for stock obsolesence based on the determination of excess stock on hand as well as damaged and unusable items.

1.19 New and amended standards adopted by the groupThe group has adopted the following new and amended IFRSs as of 1 March 2009:

IFRS 7 “Financial instruments – Disclosures” (amendment) – effective 1 January 2009. The amendment requires enhanced disclosures about fair value measurement and liquidity risk. In particular, the amendment requires disclosure of fair value measurements by level of a fair value measurement hierarchy. As the change in accounting policy only results in additional disclosures, there is no impact on earnings per share.

IAS 1 (revised). “Presentation of financial statements” – effective 1 January 2009. The revised standard prohibits the presentation of items of income and expenses (that is, “non-owner changes in equity”) in the statement of changes in equity, requiring “non-owner changes in equity” to be presented separately from owner changes in equity in a statement of comprehensive income. As a result the group presents in the consolidated statement of changes in equity all owner changes in equity, whereas all non-owner changes in equity are presented in the consolidated statement of comprehensive income. Comparative information has been re-presented so that it also is in conformity with the revised standard. As the change in accounting policy only impacts presentation aspects, there is no impact on earnings per share.

IFRS 2 (amendment), “Share-based payment” (effective 1 January 2009) deals with vesting conditions and cancellations. It clarifies that vesting conditions are service conditions and performance conditions only. Other features of a share-based payment are not vesting conditions. These features would need to be included in the grant date fair value for transactions with employees and others providing similar services; they would not impact the number of awards expected to vest or valuation there of subsequent to grant date. All cancellations, whether by the entity or by other parties, should receive the same accounting treatment. The group and company has adopted IFRS 2 (amendment) from 1 March 2009. The amendment does not have a material impact on the group or company’s financial statements.

In respect of borrowing costs relating to qualifying assets for which the commencement date for capitalisation is on or after 1 March 2009, the group capitalises borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. The group previously recognised all borrowing costs as an expense immediately. This change in accounting policy was due to the adoption of IAS 23, “Borrowing costs” (2007) in accordance with the transition provisions of the standard; comparative figures have not been restated. The change in accounting policy had no material impact on earnings per share.

IFRS 8, Operating Segments (effective from 1 January 2009). IFRS 8 replaces the previous IAS 14. The new standard requires a “management approach”, under which segment information is presented on the same basis as that used for internal reporting purposes. The group has adopted IFRS 8 from 1 March 2009. The change in accounting policy had no material impact on the group’s financial statements.

1.20 Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted by the group The following standards and amendments to existing standards have been published and are mandatory for the group’s accounting periods beginning on or after 1 March 2010 or later periods, but the group has not early adopted them:

IFRIC 17, “Distribution of non-cash assets to owners” (effective on or after 1 July 2009). This interpretation provides guidance on accounting for arrangements whereby an entity distributes non-cash assets to shareholders either as a distribution of reserves or as dividends. IFRS 5 has also been amended to require that assets are classified as held for distribution only when they are available for distribution in their present condition and the distribution is highly probable. The group and company will apply IFRIC 17 from 1 March 2010. It is not expected to have a material impact on the group or company’s financial statements.

IAS 27 (revised), ”Consolidated and separate financial statements” (effective from 1 July 2009). The revised standard requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses. The standard also specifies the accounting when control is lost. Any remaining interest in the entity is remeasured to fair value, and a gain or loss is recognised in profit or loss. The group will apply IAS 27 (revised) prospectively to transactions with non-controlling interests from 1 March 2010.

IFRS 3 (revised), “Business combinations” (effective from 1 July 2009). The revised standard continues to apply the acquisition method to business combinations, with some significant changes. For example, all payments to purchase a business are to be recorded at fair value at the acquisition date, with contingent payments classified as debt subsequently



re-measured through the income statement. There is a choice on an acquisition-by-acquisition basis to measure the non-controlling interest in the acquiree at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets. All acquisition-related costs should be expensed. The group will apply IFRS 3 (revised) prospectively to all business combinations from 1 March 2010.

IAS 38 (amendment), “Intangible Assets”. The amendment is part of the IASB’s annual improvements project published in April 2009 and the group and company will apply IAS 38 (amendment) from the date IFRS 3 (revised) is adopted. The amendment clarifies guidance in measuring the fair value of an intangible asset acquired in a business combination and it permits the grouping of intangible assets as a single asset if each asset has similar useful economic lives. The amendment will not result in a material impact on the group or company’s financial statements.

IFRS 5 (amendment), “Measurement of non-current assets (or disposal groups) classified as held-for-sale”. The amendment is part of the IASB’s annual improvements project published in April 2009. The amendment provides clarification that IFRS 5 specifies the disclosures required in respect of non-current assets (or disposal groups) classified as held-for-sale or discontinued operations. It also clarifies that the general requirement of IAS 1 still apply, particularly paragraph 15 (to achieve a fair presentation) and paragraph 125 (sources of estimation uncertainty) of IAS 1. The group and company will apply IFRS 5 (amendment) from 1 March 2010. It is not expected to have a material impact on the group or company’s financial statements.

IAS 1 (amendment), “Presentation of financial statements”. The amendment is part of the IASB’s annual improvements project published in April 2009. The amendment provides clarification that the potential settlement of a liability by the issue of equity is not relevant to its classification as current or non-current. By amending the definition of current liability, the amendment permits a liability to be classified as non-current (provided that the entity has an unconditional right to defer settlement by transfer of cash or other assets for at least 12 months after the accounting period) notwithstanding the fact that the entity could be required by the counterparty to settle in shares at any time. The group and company will apply IAS 1 (amendment) from 1 March 2010. It is not expected to have a material impact on the group or company’s financial statements.

IFRS 2 (amendments), “Group cash-settled and share-based payment transactions”. In addition to incorporating IFRIC 8, “Scope of IFRS 2”, and IFRIC 11, “IFRS 2 – Group and treasury share transactions”, the amendments expand on the guidance in IFRIC 11 to address the classification of group arrangements that were not covered by that interpretation. The new guidance is not expected to have a material impact on the group’s financial statements.

IFRS 9, “Financial instruments” (effective from 1 January 2013). This standard uses a single approach to determine whether a financial asset is measured at amortised cost or fair value. The approach in IFRS 9 is based on how an entity manages its financial instruments (its business model) and the contractual cash flow characteristics of the financial assets. The new standards also require a single impairment method to be used. It therefore improves comparability and makes financial statements easier to understand for investors and other users. The group will apply IFRS 9 to financial instruments from 1 March 2013.

1.21 Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted and not relevant for the group’s operations The following standards and amendments to existing standards have been published and are mandatory for the group’s accounting periods beginning on or after 1 March 2010 or later periods but are not relevant for the group’s operations:

– IAS 7, Statement of Cash Flows: Consequential amendments due to IAS 27 (Amended) Consolidated and Separate Financial Statements (effective from 1 July 2009).

– IAS 28, Investments in Associates: Consequential amendments due to IAS 27 (Amended) Consolidated and Separate Financial Statements (effective from 1 July 2009).

– IAS 31, Interests in Joint Ventures: Consequential amendments due to IAS 27 (Amended) Consolidated and Separate Financial Statements (effective from 1 July 2009).

– IAS 12, Income Taxes: Consequential amendments due to IAS 27 (Amended) Consolidated and Separate Financial Statements (effective from 1 July 2009).

– I AS 39, Financial Instruments: Recognition and Measurement - Amendments for eligible hedged items (effective from 1 July 2009).

– IAS 19, The Limit on A Defined Benefit Asset, Minimum Funding Requirements and Their Interaction in the South African Pension Fund Environment (effective from 1 April 2009).

– IFRIC 18, Transfer of Assets from Customers (effective from 1 July 2009).

– There are a number of minor amendments to existing standards (not addressed above). These amendments are not relevant to the group’s operations and have therefore not been listed.


2010 2009

Cost/Valuation

R

Accumulated depreciation

R

Carryingvalue

R

Cost/Valuation

R

Accumulateddepreciation

R

Carrying value

R

2. Property, plant and equipmentGroup

Land and buildings 46 941 671 (413 043) 46 528 628 39 895 409 (413 043) 39 482 366

Leasehold property 7 671 958 (1 520 738) 6 151 220 5 227 161 (1 115 778) 4 111 383

Plant and machinery 282 639 689 (73 474 090) 209 165 599 256 241 495 (49 403 050) 206 838 445

Motor vehicles 188 869 054 (71 320 431) 117 548 623 185 831 291 (59 979 524) 125 851 767

Office equipment 5 423 644 (3 445 204) 1 978 440 4 654 271 (2 620 794) 2 033 477

Dismantling costs 6 411 080 (2 522 330) 3 888 750 6 394 168 (2 172 565) 4 221 603

Total 537 957 096 (152 695 836) 385 261 260 498 243 795 (115 704 754) 382 539 041

Company

Office equipment 2 124 502 (755 826) 1 368 676 1 345 294 (183 418) 1 161 876

Movements in carrying value

Group 2010

Openingcarrying

valueR

AdditionsR

Additionsthrough

businesscombinations

R

Changein category

RDisposals

RDepreciation

R

Closing carrying

valueR

Land and buildings 39 482 366 7 046 262 – – – – 46 528 628Leasehold property 4 111 383 2 444 797 – – – (404 960) 6 151 220Plant and machinery 206 838 445 13 282 787 11 332 584 – (1 856 695) (20 431 522) 209 165 599Motor vehicles 125 851 767 14 065 480 – – (5 923 932) (16 444 692) 117 548 623Office equipment 2 033 477 921 857 34 691 – (51) (1 011 534) 1 978 440Dismantling costs 4 221 603 325 367 29 925 – (338 381) (349 764) 3 888 750Total 382 539 041 38 086 550 11 397 200 – (8 119 059) (38 642 472) 385 261 260

Group 2009Land and buildings 35 581 894 3 904 807 – – – (4 335) 39 482 366Leasehold property 3 202 848 1 161 022 15 945 58 953 – (327 385) 4 111 383Plant and machinery 172 130 977 97 552 209 3 682 491 (30 707 045) (15 800 663) (20 019 524) 206 838 445Motor vehicles 93 682 614 17 057 116 2 548 511 31 234 754 (2 259 890) (16 411 338) 125 851 767Office equipment 1 393 336 1 780 674 21 461 (586 662) – (575 332) 2 033 477Dismantling costs 3 683 013 813 472 – – – (274 882) 4 221 603Total 309 674 682 122 269 300 6 268 408 – (18 060 553) (37 612 796) 382 539 041

Company 2010

Office equipment 1 161 876 779 208 – – – (572 408) 1 368 676

Company 2009Office equipment 211 079 1 107 272 – – – (156 475) 1 161 876

A register containing the information required by paragraph 22(3) of Schedule 4 of the Companies Act is available for inspection at the registered office of the company.Certain property, plant and equipment has been encumbered as security for interest-bearing borrowings (note 18).



Group

2010 2009

R R

2. Property, plant and equipment (continued)Carrying value of assets pledged as security:

Property, plant and equipment 129 746 314 148 243 350

3. Intangible assetsMining rights 14 479 048 15 138 612

Gross amount 19 119 291 19 119 291

Accumulated amortisation and impairment (4 640 243) (3 980 679)

Carrying value 14 479 048 15 138 612

Carrying value – opening balance 15 138 612 15 771 340

Disposals – (88 888)

Amortisation for the year (659 564) (543 840)

Carrying amount – closing balance 14 479 048 15 138 612

Mining rights are amortised on a straight-line basis over the best estimate of their useful lives. None of the mining rights included in intangible assets have indefinite lives.

4. GoodwillGross amount 102 303 418 102 303 418

Accumulated impairment (971 519) (971 519)

Carrying value 101 331 899 101 331 899

Carrying value – opening balance 101 331 899 96 394 940

Additions through business combinations (531 847) 5 723 351

Adjustments – 129 535

Disposals – (806 294)

Impairment of goodwill – (109 633)

Negative goodwill included in other income 531 847 –

Carrying value – closing balance 101 331 899 101 331 899

Goodwill acquired through business combinations has been allocated to cash-generating units as follows:

Amount

Lancaster Precast 20 468 422

Lancaster Quarries 16 877 717

Rodag 1 057 984

Prima Klipbrekers 122 216

Boublok 176 995

Malans 15 738 322

Denver 39 266 892

Scottburgh 1 900 000

Sunshine Crushers 5 723 351

The group applied a discounted cash flow methodology to value goodwill. These cash flows were based on forecasts which included assumptions on operating profit, depreciation, working capital movements and capital expenditure. The assumptions are based on past experience. The discount rate applied to the cash flow projections was 19% (2009: 19%). The key assumptions used were growth rates of 10% to 15% (2009: 10% to 15%) over a period of 10 years.

The recoverable amount has been determined using the value in use calculations. During the year ended 28 February 2010 there is no impairment of any of its cash-generating units containing goodwill (2009: R109 633 was identified as not recoverable and was subsequently written off as impaired).


Name of company

Natureof

business

Totalshare

capital

%holding

2010

%holding

2009

Carryingamountshares

2010

Carryingamountshares

2009

Carryingamount

indebtness2010

Carryingamount

indebtness2009

5. Investments in subsidiaries Afrimat Share Incentive Trust Investment – – – – – 1 345 673 1 401 779

AFT Aggregates (Pty) Ltd Quarry 20 85,0 85,0 – – 133 426 70 000

Boublok (Pty) Ltd Bricks 100 100,0 100,0 888 831 888 831 (687 652) (1 036 023)

Capmat (Pty) Ltd Quarry 4 000 87,5 87,5 6 255 231 6 255 231 920 206 280 000

Christalpine Holdings 107 (Pty) Ltd Dormant 100 – 50,0 – – – –

Ikapa Quarries (Pty) Ltd Dormant 300 – 75,0 – 225 – –

Afrimat Concrete Products (previously Lancaster Pre-Cast) (Pty) Ltd

Bricks and Readymix 10 000 100,0 100,0 67 378 835 67 378 835 3 001 623 8 189 417

Afrimat Aggregates (KZN) (previously Lancaster Quarries) (Pty) Ltd Quarry 30 000 100,0 100,0 35 182 874 35 182 874 220 709 2 123 088

Afrimat Readymix (Cape) (Pty) Ltd Readymix 200 100,0 100,0 5 267 084 5 267 084 – 969 589

Afrimat Aggregates (Operations) (previously Prima Klipbrekers) (Pty) Ltd Quarry 100 100,0 100,0 106 220 430 106 220 430 (1 285 964) (17 284 880)

Prima Quarries (Pty) Ltd Quarry 2 000 100,0 100,0 – – – –

Prima Quarries Namibia (Pty) Ltd Quarry 100 100,0 100,0 100 100 – –

Rodag Holdings (Pty) Ltd Property 4 100,0 100,0 3 829 110 3 829 110 71 156 (283 923)

Rodag Properties (Pty) Ltd Property 1 000 100,0 100,0 4 382 087 4 382 087 5 205 (2 259 591)

Tradeselect 5 (Pty) Ltd Dormant 100 100,0 100,0 – – – –

Maritzburg Quarries (Pty) Ltd Quarry 70 000 100,0 100,0 1 295 741 1 295 741 457 490 457 490

Scottburgh Quarries (Pty) Ltd Quarry 100 100,0 100,0 8 020 000 8 020 000 5 731 5 731

Afrimat Aggregates (Eastern Cape) (previously Denver Quarries) (Pty) Ltd Quarry 600 100,0 100,0 53 181 208 53 181 208 163 796 (16 274 318)

Afrimat Aggregates (Trading) (previously Brickrush) (Pty) Ltd Quarry 5 000 92,7 92,7 24 933 683 24 933 683 13 316 845 7 204 186

Malans Quarries (Pty) Ltd Quarry 100 100,0 100,0 33 771 554 33 771 554 – –

Olympic Sand (Pty) Ltd Quarry 1 000 100,0 100,0 1 204 580 1 204 580 – –

Malric Properties (Pty) Ltd Property 100 100,0 100,0 13 053 322 13 053 322 – –

Propateez 66 (Pty) Ltd Property 100 100,0 100,0 831 872 831 872 – –

Melani Materials (Pty) Ltd Quarry 900 100,0 100,0 – – – –

Labonte 3 (Pty) Ltd Property 1 000 50,0 50,0 149 494 149 494 – –

Jeffreys Bay Crushers (Pty) Ltd Quarry 100 100,0 100,0 384 727 384 727 – –

Sunshine Crushers (Pty) Ltd Quarry 1 179 960 100,0 100,0 8 081 014 8 081 014 (2 872 565) (2 872 565)

Intshinga Mining (Pty) Ltd Dormant 120 50,0 50,0 60 60 (60) (60)

Afrimat Empowerment Investments (previously Bechini Investments 73) (Pty) Ltd Investment 120 – 100,0 – 120 – (120)

Blue Platinum Ventures 56 (Pty) Ltd Quarry 100 66,0 – 80 001 – – –

374 391 838 374 312 182 14 795 619 (19 310 200)

Current assets

Loans to subsidiaries 19 641 860 20 701 280

Current liabilities

Loans from subsidiaries (4 846 241) (40 011 480)

14 795 619 (19 310 200)The carrying amounts of subsidiaries are shown net of impairment losses which approximate fair value. The loans have no fixed terms of repayment and bear interest at prime less 3,5%. The subsidiaries are incorporated in the Republic of South Africa except for Prima Quarries Namibia (Pty) Ltd that is incorporated in Namibia.



Group Company

2010 2009 2010 2009

R R R R

6. Investment in associateOpening balance – – – –

Acquisition of investment 147 – 147 –

Share of net profit after tax 5 402 – – –

Closing balance 5 549 – 147 –

The group’s share of the results of its associate, which is unlisted, and its aggregated assets and liabilities, are as follows:

Ikapa Quarries (Pty) Limited (49%)

Assets 1 058 010 – – –

Liabilities (1 052 264) – – –

Revenues 211 190 – – –

Profit 5 402 – – –

7. Other financial assetsAvailable-for-sale

Listed shares at fair value

Old Mutual PLC shares 45 850 21 245 – –

Stanlib Wealthbuilder unit trust – 178 269 – –

Old Mutual funds unit trust – 142 561 – –

45 850 342 075 – –

Environmental funds at fair value

Green Horizons Environmental Rehabilitation Trust Fund 1 103 738 973 375 – –

Sanlam Endowment Policy – 1 865 291 – –

Liberty Life Endowment Policy 578 112 547 124 – –

1 681 850 3 385 790 – –

Total available-for-sale financial assets 1 727 700 3 727 865 – –

Loans and receivables

Unlisted

Funding provided to Afrimat employees/preference shares in Afrimat Empowerment Investments (Pty) Limited/Afrimat BEE Trust 65 284 386 – 65 284 386 –

Total loans and receivables 65 284 386 – 65 284 386 –

Total financial assets 67 012 086 3 727 865 65 284 386 –

Non-current assets

Available-for-sale 1 727 700 3 727 865 – –

Loans and receivables 65 284 386 – 65 284 386 –

67 012 086 3 727 865 65 284 386 –

Current assets

Available-for-sale – – – –

Loans and receivables – – – –

– – – –


7. Other financial assets (continued)The fair values of the financial assets were determined as follows:* The fair values of available-for-sale financial assets are based on the quoted market price.

Fair values are determined annually at reporting date.

None of these financial assets is either past due or impaired.

The environmental funds were originally established to fund the cost of rehabilitation on closure of certain of the group’s quarries but are being replaced by guarantees as per note 32.

Afrimat launched a broad-based BEE ownership initiative, whereby Afrimat’s black employees acquired participation rights to 16,8% of the issued share capital of the company (24 050 000 shares), utilising funding provided by Afrimat to the Afrimat BEE Trust. Afrimat Empowerment Investments (Pty) Limited/Afrimat BEE Trust assisted the employees with funding through the issuance of 1 000 preference shares to Afrimat Limited for a total subscription price of R64 205 000. The transaction consists of 14 550 000 shares purchased from previous BEE shareholders and a new issue of 9 500 000 shares. These preference shares are redeemable cumulative participating preference shares. Preference dividends are calculated at a rate of 70% of the prime interest rate. The company’s shares held by Afrimat Empowerment Investments (Pty) Limited/Afrimat BEE Trust serve as security for the preference shares.

The fair values of loans and receivables are considered to be equal to the carrying value.

Group Company

2010R

2009R

2010R

2009R

8a. Financial instruments by categoryAssets as per balance sheetLoans and receivables at amortised costOther financial assets 65 284 386 – 65 284 386 –

Trade and other receivables 115 716 618 121 723 748 4 958 549 16 704 113 Cash and cash equivalents 52 913 747 21 688 808 3 007 820 3 896 621 Loans to subsidiaries – – 19 641 860 20 701 280

233 914 751 143 412 556 92 892 615 41 302 014 Available-for-sale

Other financial assets 1 727 700 3 727 865 – – 1 727 700 3 727 865 – –

Total 235 642 451 147 140 421 92 892 615 41 302 014 The maximum exposure to credit risk at the reporting date is the fair value of each class of loans and receivables mentioned above.Liabilities as per balance sheetFinancial liabilities at amortised costBorrowings 91 870 455 101 121 700 – –Loans from subsidiaries – – 4 846 241 40 011 480Trade and other payables 88 842 535 69 104 403 2 262 169 2 803 980Bank overdraft 20 784 267 13 397 492 – –Total 201 497 257 183 623 595 7 108 410 42 815 460Trade and other payables in the prior year for the group and the company now excludes taxes and other statutory liabilities.

8b. Credit quality of fully performing financial assetsTrade receivablesCustomers without external ratingsGroup 1 (New customers) 6 535 206 8 278 022 – – Group 2 (Existing customers – with no defaults in the past) 30 367 690 35 672 357 – – Group 3 (Existing customers – some prior defaults but fully recoverable) 34 924 010 27 386 233 – –

71 826 906 71 336 612 – – None of the financial assets that are fully performing have been renegotiated in the current year.



Group Company

2010R

2009R

2010R

2009R

9. Retirement benefitsDefined contribution planIt is the policy of the group to provide retirement benefits to all its employees. A number of defined contribution retirement funds, all of which are subject to the Pensions Fund Act exist for this purpose.

The group is under no obligation to cover any unfunded benefits.

The total group contributions to such schemes. 6 247 914 5 272 136 508 511 344 896

Defined benefit planThe defined benefit plan, consists of the Lancaster Pension Fund governed by the Pension Fund Act of 1956.

The actuarial valuation determined that the retirement plan was in a sound financial position. The actuaries are in the process of conducting the required valuations to determine the origin and ownership of the surplus. Management expects the completion of the valuation and acceptence thereof by the Financial Services board to be within the next financial year.

Carrying value

Present value of the defined benefit obligation 47 290 475 42 187 213 – –

Fair value of plan assets (50 620 580) (49 616 880) – –

Net actuarial gains or losses not recognised (9 341 640) (4 362 687) – –

(12 671 745) (11 792 354) – –

Historical figures are as follows:

2008Present value of the defined benefit obligation of R39 371 407 fair value of plan assets of R43 485 656 and net actuarial losses not recognised of R6 944 714.

2007Present value of the defined benefit obligation of R33 427 173 fair value of plan assets of R31 690 996 and net actuarial losses not recognised of R13 330 431.

Movements for the year

Opening balance (11 792 354) (11 058 963) – –

Contributions by members (2 380 466) (2 264 493) – –

Net expense recognised in the income statement 1 501 075 1 531 102 – –

Closing balance (12 671 745) (11 792 354) – –

Net expense recognised in the income statement

Current service cost 2 495 020 2 308 851 – –

Interest cost 3 671 718 3 544 531 – –

Actuarial (gains)/losses – 208 296 – –

Expected return on plan assets (4 665 663) (4 530 576) – –

1 501 075 1 531 102 – –

Reconciliation of present value of the defined benefit obligation

Opening balance 42 187 213 39 371 407 – –

Current service costs 2 495 020 2 308 851 – –

Interest cost 3 671 718 3 544 531 – –

Actuarial gains and losses 78 407 (2 045 595) – –

Benefits paid (1 141 883) (991 981) – –

Closing balance 47 290 475 42 187 213 – –


Group Company

2010R

2009R

2010R

2009R

9. Retirement benefits (continued)Reconciliation of fair value of plan assets

Opening balance 49 616 880 43 485 656 – –

Expected return on plan assets 4 665 663 4 530 576 – –

Actuarial gains and losses (4 900 546) 328 136 – –

Contributions by employer 1 568 944 1 492 507 – –

Contributions by plan participants 811 522 771 986 – –

Benefits paid (1 141 883) (991 981) – –

Closing balance 50 620 580 49 616 880 – –

Net actuarial gains or losses not recognised in the balance sheet (9 341 640) (4 362 687) – –

The plan assets are invested in an Old Mutual guaranteed fund.

Future contributions Expected contributions to be paid to plan during the next financial year 2 595 312 2 457 425 – –

Key assumptions used Assumptions used on last valuation on 28 February 2010.

Actual return on plan assets (234 883) 4 858 712 – –

Discount rates used (%) 9,18 8,69 – –

Expected rate of return on assets (%) 9,71 9,29 – –

Expected returns were based on the assumption that it will exceed general inflation by 4% after allowing for investment-related expenses.

Expected increase in salaries (%) 6,71 6,29 – –

10. InventoriesThe amounts attributable to the different categories are as follows:

Raw materials, components 7 652 378 7 989 757 – –

Finished products 59 046 332 54 822 730 – –

Production supplies 7 481 259 15 089 824 – –

74 179 969 77 902 311 – –

Provision for stock obsolescence (5 318 119) (2 500 000) – –

68 861 850 75 402 311 – –

The carrying value of finished products, identified as slow-moving is R6 768 566 (2009: R1 585 795), after allowing for the provision of stock obsolescence.

11. Trade and other receivables Trade receivables 115 082 410 105 806 228 – –

Less: Provision for impairment of receivables (10 371 512) (5 794 623) – –

Trade receivables – net 104 710 898 100 011 605 – –

Pre-payments 6 235 679 9 723 852 119 071 44 305

Deposits 1 246 706 912 140 – –

Value added tax 7 351 868 919 925 – –

Loans to related parties 1 652 107 – – –

Other receivables 9 759 014 20 800 003 4 958 549 16 704 113

130 956 272 132 367 525 5 077 620 16 748 418



Group Company

2010R

2009R

2010R

2009R

11. Trade and other receivables (continued)The fair values of trade and other receivables are considered to be equal to the carrying value.

The carrying values of the trade and other receivables are all denominated in South African Rand.

Included in the other receivables are loans to Joe Kalo Investments (Pty) Limited of R4 159 505 (2009: R4 087 504) and Forecast Investments (Pty) Limited of R Nil (2009: R11 956 200). These loans were made with respect to the group’s BEE shareholding.

The loans to related parties are loans made by subsidiaries to the group’s associate Ikapa Quarries (Pty) Limited. The loans are repayable over five years and bear interest at prime less 3%.

As at 28 February 2010, the group had trade and other receivables of R32 883 992 (2009: R28 674 993) which were past due but not impaired. These relate to a number of reputable customers for whom there is no history of default, settlement agreements are in place or that management believes will in all probability pay.

The age analysis of these trade and other receivables is as follows:

Neither impaired nor past due 71 826 906 71 336 612 – –

Not impaired but past due in

– between 30 and 60 days 11 533 686 12 172 481 – –

– between 60 and 90 days 6 962 956 5 254 066 – –

– more than 90 days 14 387 350 11 248 446 – –

32 883 992 28 674 993 – –

104 710 898 100 011 605 – –

An impairment provision of R10 371 512 (2009: R5 794 623) was recognised against receivables. The ageing of the impairment portion of receivables, which is past due, is as follows:

Between 30 and 60 days 524 325 65 241 – –

Between 60 and 90 days 972 487 532 306 – –

More than 90 days 8 874 700 5 197 076 – –

10 371 512 5 794 623 – –

Movements in the provision for impairment of trade receivables are as follows:

Opening balance 5 794 623 4 219 003 – –

Additional provision charged to income statement 7 023 696 4 334 956 – –

Provisions reversed to income statement (794 995) (1 481 151) – –

Receivables written off during the year as uncollectible (1 651 812) (1 278 185) – –

Closing balance 10 371 512 5 794 623 – –

The creation and release of provision for impaired receivables have been included in operating expenses in the income statement. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash. The other classes within trade and other receivables do not contain impaired assets.

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above.


Group Company

2010R

2009R

2010R

2009R

12. Cash and cash equivalents Cash and cash equivalents consist of:

Cash on hand 186 741 166 037 1 932 138

Bank balances 34 096 980 13 893 831 3 005 888 3 896 483

Short-term deposits 18 630 026 7 628 940 – –

Bank overdraft (20 784 267) (13 397 492) – –

32 129 480 8 291 316 3 007 820 3 896 621

Current assets 52 913 747 21 688 808 3 007 820 3 896 621

Current liabilities (20 784 267) (13 397 492) – –

32 129 480 8 291 316 3 007 820 3 896 621

13. Share capitalAuthorised

1 000 000 000 ordinary shares of 1 cent each 10 000 000 10 000 000 10 000 000 10 000 000

Issued

143 262 412 (2009: 133 762 412) ordinary shares of 1 cent each 1 434 624 1 339 624 1 432 624 1 337 624

Opening balance 1 339 624 1 339 627 1 337 624 1 337 627

Issued

9 500 000 ordinary shares of 1 cent 95 000 – 95 000 –

Cancelled

326 ordinary shares of 1 cent – (3) – (3)

Closing balance 1 434 624 1 339 624 1 432 624 1 337 624

All the unissued shares are under the control of the company’s directors until the next annual general meeting.

Refer to explanation of capital structure included with note 14 on share premium.

All shares issued by the company were fully paid.

14. Share premium Opening balance 325 169 773 326 115 905 325 169 773 326 115 905

9 500 000 ordinary shares of 1 cent issued at a premium of 284 cents 26 980 000 – 26 980 000 –

Share issue expenses written off – (946 132) – (946 132)

Closing balance 352 149 773 325 169 773 352 149 773 325 169 773

Business combination adjustment (105 788 129) (105 788 129) – –

The group financial statements are issued in the name of Afrimat Limited but are, in fact, prepared as a continuation of the group financial statements of Prima. For purposes of these group consolidated results, Prima has been identified as the acquirer in terms of IFRS 3. In arriving at the issued share capital of the group under this method, the amount of the issued share capital of Prima immediately before the business combination is added to the cost of the business combination in accordance with IFRS 3. This has resulted in an adjustment against the issued share capital of the group of R105 788 129. This amount has been reflected separately on the statement of financial position. The issue and authorised equity structure in note 13 is that of Afrimat.



Group Company

2010R

2009R

2010R

2009R

15. Treasury shares 228 329 (2009: 228 329) shares held by the Afrimat

Share Incentive Trust (1 400 611) (1 400 611) – –

3 169 951 (2009: 627 500) shares held by Afrimat Aggregates (Operations) (Pty) Limited a subsidiary (9 601 179) (2 718 990) – –

(11 001 790) (4 119 601) – –

The company acquired Nil (2009: 108 746) of its own shares through purchases on the Johannesburg stock exchange in the Afrimat Share Incentive Trust and 2 542 451 (2009: 627 500) in Afrimat Aggregates (Operations) (Pty) Limited. The total amount paid to acquire the shares was R6 882 189 (2009: R3 232 953) and has been deducted from shareholder’s equity. The shares are held as “treasury shares”. The company has the right to reissue these shares at a later date.

16. Share optionsShare options are granted to directors and to selected employees. The exercise price of the granted options is equal to the previous business day’s volume weighted average price for the Afrimat share on the date when the option is exercised. Options are conditional on the employee completing three years service (the vesting period). The options are exercisable starting three years from the grant date, subject to the group achieving its target growth in headline earnings per share over the period; the options have a contractual option term of four years. The group has no legal or constructive obligation to repurchase or settle the options in cash.

Movements in the number of share options outstanding and their related weighted average exercise prices are as follows:

Average exercise

price in cents per share

28/02/2010

Number ofoptions

28/02/2010

Average exercise

price in cents per share

28/02/2009

Number ofoptions

28/02/2009

Opening balance 737 2 520 000 850 960 000

Granted 200 3 400 000 668 1 560 000

Forfeited 392 (310 000) – –

Closing balance 431 5 610 000 737 2 520 000

None of the options outstanding are exercisable at 28 February 2010 (2009: Nil).Share options outstanding at the end of the year have the following expiry date and exercise prices:

Exercise priceCents

Number of options

28/02/2010

Number ofoptions

28/02/2009

2014 850 1 050 000 1 100 000

2015 650 1 360 000 1 420 000

2016 200 3 200 000 –

5 610 000 2 520 000

The remaining number of shares that may be utilised for the purpose of this scheme are:

Number of shares

2010

Number of shares

2009

Opening balance 24 232 482 25 792 547

Increase/(decrease) in authority 33 247 518 (65)

Utilised (27 140 000) (1 560 000)

Closing balance 30 340 000 24 232 482

The maximum number of shares authorised for purposes of the Afrimat Share Investment Scheme is 14 326 241 shares, being 10% (ten percent) of the number of ordinary shares in issue.


16. Share options (continued)Number of share options held by directors:

Opening balance Granted

Averageexercise price

in centsper share

Expirydates

Closing balance

2010

AJ van Heerden 450 000 500 000 200 2016 950 000

HP Verreynne 270 000 390 000 200 2016 660 000

PG Corbin 270 000 300 000 200 2016 570 000

990 000 1 190 000 2 180 000

2009

AJ van Heerden 150 000 300 000 650 2015 450 000

HP Verreynne 110 000 160 000 650 2015 270 000

PG Corbin 110 000 160 000 650 2015 270 000

370 000 620 000 990 000

None of the options outstanding are exercisable at 28 February 2010 (2009: Nil).

The fair value of options granted during the year, using the Black Scholes valuation model, was R2 244 000 (2009: R3 567 000). The option expense for the year was R746 188 (2009: R1 574 462). Option expenses of R899 350 recognised in the previous years were reversed due to non-market conditions that are not expected to be achieved.

The significant inputs into the valuation model were: current share prices, risk free rates of 8,25% to 9,46% (2009:8,41% to 9,46%), option grant prices and option life shown above, dividend yields of 2,71% to 6,50% (2009: 2,71% to 3,54%), share price volatility of 26% to 51% (2009: 26% to 30%) and the likelihood that the market condition will be satisfied. The share price volatility is measured at the standard deviation of expected share price returns based on the statistical analysis of monthly share prices over the current year.

Group Company

2010 2009 2010 2009

R R R R

17. Other reserves Analysis

Available-for-sale reserve 173 247 445 239 – –

Share-based payment reserve (IFRS 2) 1 661 300 1 814 462 762 196 925 644

1 834 547 2 259 701 762 196 925 644

Reconciliations Available-for-sale reserve

Opening balance 445 239 694 981 – –

Fair value adjustment 192 656 (247 370) – –

Reclassification adjustment for gain included in profit and loss (464 648) – – –

Disposal to non-controlling interests – (2 372) – –

Closing balance 173 247 445 239 – –

Share-based payment reserve (IFRS 2)

Opening balance 1 814 462 240 000 925 644 92 500

Share option expense for the year 746 188 1 574 462 253 086 833 144

Reversal of previous year expenses (899 350) – (416 534) –

Closing balance 1 661 300 1 814 462 762 196 925 644



Group Company

2010 2009 2010 2009

R R R R

18. Borrowings Non-current liabilities

Mortgage loans 1 905 794 1 984 294 – –

Instalment purchase agreements 40 652 533 56 218 173 – –

Other loans 5 947 538 – – –

48 505 865 58 202 467 – –

Current liabilities

Mortgage loans 65 298 30 659 – –

Instalment purchase agreements 43 299 292 42 888 574 – –

Other loans – – – –

43 364 590 42 919 233 – –

Mortgage loans

At amortised cost 1 971 092 2 014 953 – –

The loans are repayable in 208 monthly instalments of R18 168, and bear interest at a rate of 8,5% per annum (2009: 220 monthly instalments of R24 048 and bore interest at a rate of 12% per annum).

1 971 092 2 014 953 – –

Non-current liabilities


Current liabilities

At amortised cost 65 298 30 659 – –

1 971 092 2 014 953 – –

The mortgage loans are secured by property, with a net book value of R2 434 295 (2009: R2 434 295) of the group as per note 2.

Instalment purchase agreements

Minimum payments due

– within one year 53 622 675 51 054 665 – –

– in second to fifth year inclusive 40 831 017 65 621 829 – –

94 453 692 116 676 494 – –

Less: future finance charges (10 501 867) (17 569 747) – –

Present value of minimum payments 83 951 825 99 106 747 – –

Present value of minimum payments due

– within one year 43 299 292 42 888 574 – –

– in second to fifth year inclusive 40 652 533 56 218 173 – –

83 951 825 99 106 747 – –



Current liabilities


83 951 825 99 106 747 – –


Group Company

2010 2009 2010 2009

R R R R

18. Borrowings (continued)It is group policy to purchase certain property, plant and equipment under instalment purchase agreements.

The average repayment term was one to three years and the average effective borrowing rate was 8,5 % to 10,5 % (2009: 12% to13,5%).

The group’s obligations under instalment purchase agreements are secured by the lessor’s charge over the financed assets (refer note 2).

Other loans

At amortised cost 5 947 538 – – –

The other loan is owed to a non-controlling shareholder of a subsidiary, Blue Platinum Ventures 56 (Pty) Limited, is interest free, unsecured and is only repayble when funding provided by the group is repaid.


At amortised cost 5 947 538 – – –

Current liabilities

At amortised cost – – – –

5 947 538 – – –

The exposure of the group’s borrowings to interest rate changes and the contractual repricing dates at the reporting dates are as follows:

At fixed rates – – – –

At floating rates 85 922 917 101 121 700 – –

Interest free 5 947 538 – – –

91 870 455 101 121 700 – –

The fair value of borrowings equals their carrying amount, as the impact of discounting is not significant.

The carrying amounts of the group’s borrowings are all denominated in South African Rand.

The group has the following undrawn borrowing facilities:

Floating rate:

– Expiring within one year 98 322 041 83 486 014 260 000 260 000

– Expiring beyond one year – – – –

Fixed:

– Expiring within one year – – – –

98 322 041 83 486 014 260 000 260 000

The group’s non-current borrowings (excluding instalment purchase agreements) mature as follows:

– less than one year 65 298 30 659 – –

– between one and five years 6 285 849 166 771 – –

– later than five years 1 567 483 1 817 523 – –

7 918 630 2 014 953 – –



Group Company

2010 2009 2010 2009

R R R R

19. Provisions Environmental rehabilitation 6 749 205 5 615 088 – –

Dismantling 6 411 080 6 394 168 – –

13 160 285 12 009 256 – –

Non-current liabilities 13 160 285 12 009 256 – –

Current liabilities – – – –

13 160 285 12 009 256 – –

Reconciliation of provisions Environmental rehabilitation

Opening balance 5 615 088 2 941 476 – –

Additions and discount unwinding 1 134 117 2 673 612 – –

Closing balance 6 749 205 5 615 088 – –

Dismantling

Opening balance 6 394 168 5 580 696 – –

Additions and discount unwinding 355 293 813 472 – –

Utilised during the year (338 381) - - -

Closing balance 6 411 080 6 394 168 - -

Group policy is that environmental rehabilitation and dismantling estimates will be reviewed annually and be re-assessed by independent consultants every three years. Management has reviewed all environmental rehabilitation and dismantling provisions at year-end. The expected timing of any outflows of these provisions will be on the closure of the respective mines. Estimates are based on costs that are reviewed regularly and adjusted as appropriate for new circumstances. Future cash flows are appropriately discounted. A discount rate of 8% (2009: 15%) was used.

20. Deferred tax Accelerated capital allowances for tax purposes (61 715 046) (53 711 731) – –

Provisions 1 315 350 (129 472) 91 721 75 508

Tax losses available for set off against future taxable income 6 266 116 3 859 536 – –

Other deferred tax (2 763 445) (3 731 306) (209 099) (209 099)

(56 897 025) (53 712 973) (117 378) (133 591)

Reconciliation of deferred tax asset/(liability)

Opening balance (53 712 973) (49 096 550) (133 591) –

Acquired through business combinations 2 700 595 (1 350 251) – –

Accelerated capital allowances for tax purposes (5 252 849) (6 215 424) – –

Provisions 1 491 607 612 340 16 213 75 508

Increase/(decrease) in tax losses available for set off against future taxable income (2 137 103) 2 445 059 – –

Other 13 698 (108 147) – (209 099)

Closing balance (56 897 025) (53 712 973) (117 378) (133 591)


Group Company

2010 2009 2010 2009

R R R R

20. Deferred tax (continued)Non-current assets 4 569 767 – – –

Non-current liabilities (61 466 792) (53 712 973) (117 378) (133 591)

(56 897 025) (53 712 973) (117 378) (133 591)

Management is of the opinion that it is probable that future taxable profits will be available against which the unused tax losses can be utilised. The new financial year budgets indicate that companies with assesed losses will be profitable.

Tax consequences of undistributed reserves

STC on remaining reserves if all reserves are distributed 29 606 144 24 734 295 9 730 070 4 208 635

21. Trade and other payables Trade payables 64 467 774 53 866 745 485 365 1 981 943

Amounts due to related parties 1 818 261 – – –

Taxes and other statutory liabilities 2 505 379 4 159 920 309 207 396 203

Accrued expenses 18 683 107 12 149 364 1 741 584 806 273

Other payables 3 873 393 3 088 294 35 220 15 764

91 347 914 73 264 323 2 571 376 3 200 183

Trade and other payables are payable within normal trade terms.

The fair values of trade and other payables are considered to be equal to the carrying value.

The carrying values of trade and other payables are all denominated in South African Rand.

The amounts due to related parties are due to non-controlling shareholders of a subsidiary Labonte 3 (Pty) Limited. The payables have no fixed repayment terms and bear no interest.

22. Revenue Sale of goods and services 761 147 450 671 004 760 17 663 677 16 937 381

Interest received (Trading) 16 868 402 16 086 021 – –

778 015 852 687 090 781 17 663 677 16 937 381

23. Operating profit Income from subsidiaries

Dividends – – 78 640 000 64 966 740

Administration and management fees – – 17 663 677 16 937 381

– – 96 303 677 81 904 121

Operating lease charges

Premises

– Contractual amounts 6 056 484 6 107 726 290 258 183 665

Equipment

– Contractual amounts 19 598 053 6 240 773 15 648 15 691

Lease rentals on operating lease – other

– Contractual amounts 1 126 438 602 333 – –

26 780 975 12 950 832 305 906 199 356



Group Company

2010 2009 2010 2009

R R R R

23. Operating profit (continued)Other

Profit on sale of property, plant and equipment 2 052 036 3 681 899 – –

Amortisation of intangible assets 659 564 543 840 – –

Depreciation of property, plant and equipment 38 642 472 37 612 796 572 408 156 475

Impairment of goodwill – 109 633 – –

Inventory written off during the year – 1 534 011 – –

Inventory provision for obsolescence 2 818 119 2 500 000 – –

Net foreign exchange gains/(losses) 102 684 (96 784) – –

Audit fees

Current year 1 950 466 1 832 912 778 463 685 610

Other services – – – –

1 950 466 1 832 912 778 463 685 610

Employee costs

Defined contribution plan contributions 6 247 914 5 272 136 508 511 344 896

Defined benefit plan contributions 1 501 075 1 531 102 – –

Share-based payment expense (153 162) 1 574 462 (163 448) 833 144

Other employee expenses 139 076 035 127 526 370 10 635 894 8 030 930

146 671 862 135 904 070 10 980 957 9 208 970

24. Investment revenue Dividend revenue

Listed financial assets – Local 4 656 26 117 – –

Inter-company – – 78 640 000 64 966 740

4 656 26 117 78 640 000 64 966 740

Interest revenue

Bank 3 166 286 2 769 449 792 216 305 611

Deemed interest/Preference dividends (BEE structure) 2 340 140 – 2 340 140 –

Group companies – – 1 618 449 2 643 858

Other interest 1 296 537 1 725 986 586 814 218 103

6 802 963 4 495 435 5 337 619 3 167 572

6 807 619 4 521 552 83 977 619 68 134 312

25. Finance costs Instalment purchase agreements 9 469 635 10 967 849 – –

Bank 2 970 768 1 301 581 – 97

South African Revenue Services 57 492 249 265 – 9 323

Group companies – – 2 335 614 2 011 970

Other interest paid 461 760 703 959 104 786 37 048

12 959 655 13 222 654 2 440 400 2 058 438


Group Company

2010 2009 2010 2009

R R R R

26. Taxation Major components of the tax expense/income

Current

Local income tax

– current year 21 919 628 22 122 597 268 463 1 012 496

– recognised in current year for prior years (76 408) 13 471 – 26 825

Secondary tax on companies 1 959 674 2 814 454 1 929 674 2 809 011

23 802 894 24 950 522 2 198 137 3 848 332

Deferred

Deferred tax – current year 6 061 590 3 298 795 (16 213) (75 507)

29 864 484 28 249 317 2 181 924 3 772 825

Tax rate reconciliation

Standard tax rate (%) 28,0 28,0 28,0 28,0

Permanent differences (%) (0,7) 1,5 (27,7) (26,6)

Effect of higher Namibia tax rate (%) (0,1) (0,1) – –

Secondary tax on companies (%) 1,9 3,3 2,4 4,2

Effective rate (%) 29,1 32,7 2,7 5,6

27. Notes to the statement of cash flows27.1 Cash generated from/(used in) operations

Profit before taxation 102 777 115 86 346 629 82 214 441 67 338 465

Adjustments for:

Depreciation and amortisation 39 302 036 38 156 636 572 408 156 475

Share of profit of associate (5 402) – – –

Negative goodwill (531 847) – – –

Impairment of goodwill – 109 633 – –

Goodwill adjustment – (129 535) – –

Profit on sale of assets (2 052 036) (3 681 899) – –

Profit on sale of business – (1 371 938) – (2 038 503)

Profit on sale of financial instruments (668 942) – – –

Investment revenue (4 656) (26 117) (78 640 000) (64 966 740)

Interest received (6 802 963) (4 495 435) (5 337 619) (3 167 572)

Finance costs 12 959 655 13 222 654 2 440 400 2 058 438

Retirement fund expense 1 501 075 1 531 102 – –

Contributions to retirement funds (2 380 466) (2 264 493) – –

Movements in provisions 950 556 2 972 183 – –

Share-based payment reserve (153 162) 1 574 462 (163 448) 833 144

Movement in non-controlling interests 24 218 – – –

Changes in working capital:

Inventories 7 221 487 (15 467 824) – –

Trade and other receivables 2 216 091 (11 368 365) 11 671 023 (16 690 034)

Trade and other payables 12 138 306 14 371 070 (628 807) (333 985)

166 491 065 119 478 763 12 128 398 (16 810 312)



Group Company

2010 2009 2010 2009

R R R R

27. Notes to the statement of cash flows (continued)

27.2. Tax (paid)/refunded

Opening balance 3 286 290 (9 013 960) 252 907 (703 522)

Current tax for the year recognised in income statement (23 802 894) (24 950 522) (2 198 137) (3 848 332)

Adjustment in respect of businesses sold and acquired during the year – (939 755) – –

Closing balance (5 064 830) (3 286 290) (138 009) (252 907)

(25 581 434) (38 190 527) (2 083 239) (4 804 761)

27.3 Share capital

Total proceeds/(Shares cancelled) 95 000 (3) 95 000 (3)

Less: Shares issued to Afrimat’s black employees (95 000) – (95 000) –

– (3) – (3)

27.4. Share premium

Total proceeds 26 980 000 – 26 980 000 –

Less: Shares issued to Afrimat’s black employees (26 980 000) – (26 980 000) –

Less: Expenses written off – (946 132) – (946 132)

– (946 132) – (946 132)

28. Dividends paid Current year interim dividend paid 8 595 745 6 688 045 8 595 745 6 688 045

Previous year final dividend paid 10 700 993 21 401 986 10 700 993 21 401 986

Dividends received on treasury shares (262 224) (31 646) – –

Dividends paid by subsidiaries to non-controlling shareholders 300 000 54 430 – –

19 334 514 28 112 815 19 296 738 28 090 031

29. Acquisition of businesses The group acquired 66% of Blue Platinum Ventures 56 (Pty) Limited with effect from 1 July 2009.

Prior year acquisition include Sunshine Crushers (Pty) Limited with effect from 1 August 2008.

Fair value of assets acquired

Investment in subsidiaries – – (80 001) (8 081 014)

Property, plant and equipment (11 397 200) (6 268 408) – –

Deferred tax assets/liabilities (2 700 595) 1 350 251 – –

Inventories (681 032) (243 563) – –

Trade and other receivables (804 838) (524 819) – –

Trade and other payables 5 945 285 283 459 – –

Tax assets/liabilities – 939 755 – –

Borrowings 11 532 412 1 868 780 – –

Cash (65 740) (278 019) – –

Rehabilitation reserve 200 473 514 901 – –

Non-controlling interests (2 640 613) – – –

Fair value of assets acquired (611 848) (2 357 663) (80 001) (8 081 014)

Goodwill on acquisitions 531 847 (5 723 351) – –

(80 001) (8 081 014) (80 001) (8 081 014)


Group Company

2010 2009 2010 2009

R R R R

29. Acquisition of businesses (continued)Net cash outflow on acquisition

Cash acquired 65 740 278 019 – –

Cash paid on acquisition (80 001) (8 081 014) (80 001) (8 081 014)

(14 261) (7 802 995) (80 001) (8 081 014)

Blue Platinum Ventures 56 (Pty) Limited operated for four months prior to acquisition. After due consideration of the fair values of the assets and liabilities acquired these were determined to be their carrying values at date of acquisition.

The acquired business contributed after tax losses of R1 850 483 (2009: R1 092 756 profits) to the group for the period included in the results of the group.

30. Disposal of businesses Prior year disposals include 7,3% of Brickrush (Pty) Limited with effect from 1 March 2008 and 15% of AFT Aggregates (Pty) Limited from 1 May 2008.

Fair value of assets disposed of

Investment in subsidiaries – – – (1 963 497)

Goodwill – (806 294) – –

Mining rights – (88 888) – –

Property, plant and equipment – (323 578) – –

Deferred tax assets/liabilities – 22 976 – –

Other non-current assets – (1 301 783) – –

Inventories – (201 801) – –

Trade and other receivables – (1 861 694) – –

Trade and other payables – 645 312 – –

Tax assets/liabilities – (176 392) – –

Borrowings – 1 345 269 – –

Rehabilitation provision – 33 134 – –

Cash – 83 677 – –

Fair value of assets disposed of – (2 630 062) – (1 963 497)

Proceeds – 4 002 000 – 4 002 000

Profit with sale of business – 1 371 938 – 2 038 503

Net cash inflow on disposal – 4 002 000 – 4 002 000



Group Company

2010 2009 2010 2009

R R R R

31. Commitments Authorised capital expenditure

Contracted after year-end, but not provided for – Property, plant and equipment 6 543 695 5 294 986 36 256 – Not yet contracted for – Property, plant and equipment 45 407 767 38 031 664 1 149 506 1 379 374 Operating leases – as lessee (expense) Minimum lease payments due – within one year 5 245 566 3 687 624 395 540 218 803

– in second to fifth year inclusive 9 402 947 6 299 654 556 119 563 688

14 648 513 9 987 278 951 659 782 491

Operating lease payments represent rentals payable by the group for quarries, other premises, motor vehicles and equipment. Certain leases carry standard escalation clauses in line with inflation. Approved capital expenditure to be funded from surplus cash and bank financing.

32. ContingenciesGuaranteesGuarantees to the value of R12 003 731 (2009: R10 331 731) were supplied by Standard Bank to various parties, including the Department of Mineral Resources and Eskom.

Guarantees to the value of R11 835 357 (2009: R6 115 164) were supplied by First National Bank to various parties, including the Department of Mineral Resources and Eskom.

These guarantees are in respect of environmental rehabilitation costs and will only be payable in the event of default by the group.

33. Related partiesDuring the year under review, the company and its subsidiaries, in the ordinary course of business, entered into various sale and purchase transactions with related parties. Those transactions occurred under terms that are no less favourable than those arranged with third parties.

Company

2010 2009

Loan balances owing (to)/by Subsidiaries 14 795 619 (19 310 200)

Sales of goods to – gross values Subsidiaries 17 663 677 16 937 381

Interest paid to Subsidiaries (2 335 614) (2 011 970)Interest received from Subsidiaries 1 618 449 2 643 858The company has provided an unlimited omnibus securityship for its subsidiaries.

34. Earnings per share Group

2010 2009

Shares in issue

Total shares in issue 143 262 412 133 762 412 Treasury shares (3 398 280) (855 829)

Net shares in issue 139 864 132 132 906 583

Net shares in issue

March 132 586 783 133 643 155

April 132 056 471 133 643 155

May 131 955 263 133 625 365

June 131 807 792 133 615 257

July 131 807 792 133 576 909

August 141 301 545 133 571 909

September 141 301 545 133 571 909


Group

2010 2009

34. Earnings per share (continued)October 141 301 545 133 571 909 November 141 301 545 133 544 409 December 140 944 504 133 532 909 January 140 607 220 132 957 909 February 139 864 132 132 906 583 Weighted average number of net shares in issue 137 236 345 133 480 115 Adjusted for effect of future share-based compensation payments 1 053 789 – Diluted weighted average number of shares 138 290 134 133 480 115

2010 2009Reconciliation of headline earnings Gross Net of tax Gross Net of taxProfit attributable to ordinary shareholders 72 911 082 57 702 852 Profit on disposal of property, plant and equipment (2 052 036) (1 477 466) (3 681 899) (2 650 967) Profit on disposal of subsidiaries – (1 371 938) (1 086 547) Profit on disposal of financial instruments (668 942) (464 648) – Negative goodwill included in other income (531 847) (531 847) – Impairment of goodwill – 109 633 109 633 Headline earnings 70 437 121 54 074 971 HEPS (cents) 51,3 40,5 Diluted HEPS (cents) 50,9 40,5

Basic salary

R

Incentivebonus

R

Travel allowance

R

Otherallowances

RPension

R

Medical Aid

RTotal

R

35. Directors’ emoluments 2010 Paid by company Executive AJ van Heerden 1 559 322 345 600 168 383 – – 12 678 2 085 983HP Verreynne 1 102 119 240 000 97 431 – 114 305 – 1 553 855

2 661 441 585 600 265 814 – 114 305 12 678 3 639 838Fees

Non-executive MW von Wielligh 429 000 – – – – – 429 000 F du Toit 97 000 – – – – – 97 000 M Kaplan (retired 19 August 2009) 69 167 – – – – – 69 167 L Dotwana 199 000 – – – – – 199 000 HJE van Wyk 135 750 – – – – – 135 750 LP Korsten (appointed 8 October 2009) 52 917 – – – – – 52 917 PRE Tsukudu (appointed 19 October 2009) 44 375 – – – – – 44 375

1 027 209 – – – – – 1 027 209 Total 3 688 650 585 600 265 814 – 114 305 12 678 4 667 047



Basic salary

R

Incentivebonus

R

Travel allowance

R

Otherallowances

RPension

R

Medical Aid

RTotal

R

35. Directors’ emoluments2010 (continued)Paid by subisidiariesExecutive PG Corbin 1 162 680 150 000 196 975 14 728 – 22 587 1 546 970Non-executive F du Toit 520 439 33 244 144 525 7 388 – 20 738 726 334 Total 1 683 119 183 244 341 500 22 116 – 43 325 2 273 3042009 Paid by company Executive AJ van Heerden 1 433 535 57 310 197 633 – – 9 000 1 697 478PG Corbin 1 092 484 86 188 196 550 – – 10 800 1 386 022HP Verreynne 994 179 99 835 99 554 – 109 356 – 1 302 924

3 520 198 243 333 493 737 – 109 356 19 800 4 386 424Fees

Non-executive MW von Wielligh 397 000 – – – – – 397 000 F du Toit 89 000 – – – – – 89 000 M Kaplan 152 000 – – – – – 152 000 L Dotwana 165 000 – – – – – 165 000 GN Chili 102 375 – – – – – 102 375 HJE van Wyk 105 333 – – – – – 105 333

1 010 708 – – – – – 1 010 708 Total 4 530 906 243 333 493 737 – 109 356 19 800 5 397 132Paid by subsidiaries Non-executive F du Toit 1 049 652 84 724 188 196 3 965 – 10 800 1 337 337 Total 1 049 652 84 724 188 196 3 965 – 10 800 1 337 337

36. Financial risk managementThe group’s financial instruments consist mainly of cash and cash equivalents, trade and other receivables, financial assets, trade and other payables and borrowings.

The group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The group’s overall risk management programme focuses on the unpredictibility of financial markets and seeks to minimise potential adverse effects on the group’s financial performance.

Risk management is carried out by a central treasury department (group treasury) under policies approved by the board of directors. Group treasury identifies, evaluates and hedges financial risks in close cooperation with the group’s operating units. The board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative financial instruments, and investment of excess liquidity.

(a) Market risk(i) Foreign exchange riskThe group is not materially exposed to currency risks as the group executes its operating activities in its functional currency.

At reporting date the group had no exposure to currency risks for unhedged payables denominated in foreign currencies (2009: R Nil).


36. Financial risk management (continued)(ii) Price riskThe group is exposed to equity securities price risk because of investments held by the group and classified on the statement of financial position as available-for-sale investments. The group is not exposed to commodity price risk.

The group’s investments in equity securities are publicly traded on the JSE Limited.

As part of the presentation of market risks, IFRS 7 also requires disclosures on how hypothetical changes in risk variables affect the price of financial instruments. Important risk variables are stock exchange prices or indices.

As all the group’s investments are classified as available-for-sale investments, any change in market prices of investments will have no effect on the group’s profits. Movements in market prices will be charged directly to equity.

(iii) Interest rate riskThe group’s interest rate risk arises from cash and cash equivalents and financial liabilities as set out in notes 12 and 18. Cash and cash equivalents invested and financial liabilities obtained at variable interest rates expose the group to cash flow interest rate risk. Cash and cash equivalents invested and financial liabilities obtained at fixed rates expose the group to fair value interest rate risk.

The group’s policy is to invest cash and cash equivalents and to obtain financial liabilities at variable interest rates and not to make use of any interest rate derivatives, which expose the group to cash flow interest rate risk in South Africa.

Sensitivity analysisInterest rate risks are presented by way of sensitivity analyses in accordance with IFRS 7. These show the effects of changes in market interest rates on interest payments, interest income and expense, other income components and, if appropriate, shareholders’ equity.

During 2010, if interest rates on Rand-denominated borrowings and cash had been 2% higher/lower with all other variables held constant, the group’s net profit after tax would have been R1 101 054 (2009: R864 324 at 2%) lower/higher; mainly as a result of higher/lower interest rate expense/income on floating rate borrowings and investments.

(b) Credit riskFinancial assets which potentially subject the group to concentrations of credit risk consist of cash and cash equivalents and receivables. The group’s cash is placed with recognised financial institutions.

Trade receivables are disclosed net of provision for impairment. Risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal ratings. The utilisation of credit limits and adherence to payment terms are regularly monitored. Credit risk is limited due to the large number of customers comprising the group’s customer base and their dispersion across geographical areas, accordingly the group has limited concentrations of credit risk. Provision for impairment is considered adequate as most of the balance relates to customers that have a good track record with the company and limited bad debt write-offs have been experienced in the past.

The group’s concentration of credit risk is limited to South Africa and Namibia.

(c) Liquidity riskLiquidity risk is the risk that the group will not be able to meet its financial obligations as they fall due. The group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities, when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the group’s reputation.

The group monitors its cash flow requirements through monthly cash forecasts which includes the servicing of financial obligations, but excludes the potential impact of extreme circumstances that cannot reasonably be predicted.

The following are the group’s financial liabilities analysed into relevant maturity groupings based on the remaining period at the statement of financial position to the contractual maturity date. The amounts disclosed in the table are contractual undiscounted cash flows. Balances due within 12 months equal their carrying balances as the impact of discounting is not significant.



36. Financial risk management (continued)Carrying Total Less than Between 1 Over 5

values cash flows 1 year and 5 years years

GroupAt 28 February 2010

Mortgage loans 1 971 092 3 779 122 218 026 872 105 2 688 991

Instalment purchase agreements 83 951 825 94 453 692 53 622 675 40 831 017 –

Other loans 5 947 538 5 947 538 – 5 947 538 –

Trade and other payables 88 842 535 88 842 535 88 842 535 – –

Bank overdraft 20 784 267 20 784 267 20 784 267 – –

201 497 257 213 807 154 163 467 503 47 650 660 2 688 991

At 28 February 2009

Mortgage loans 2 014 953 4 966 376 270 893 1 083 573 3 611 910

Instalment purchase agreements 99 106 747 116 676 494 51 054 665 65 621 829 –


Bank overdraft 13 397 492 13 397 492 13 397 492 – –

183 623 595 204 144 765 133 827 453 66 705 402 3 611 910

CompanyAt 28 February 2010

Loans from subsidiaries 4 846 241 4 846 241 4 846 241 – –


7 108 410 7 108 410 7 108 410 – –

At 28 February 2009

Loans from subsidiaries 40 011 480 40 011 480 40 011 480 – –


42 815 460 42 815 460 42 815 460 – –

(d) Capital risk managementThe group’s objectives when managing capital are to safeguard the group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to shareholders or sell assets to reduce debt.

The group monitors capital on the basis of the net debt:equity ratio. This ratio is calculated as net debt divided by total equity. Net debt is calculated as total borrowings less cash and cash equivalents as shown in the statement of financial position.

The group’s strategy is to maintain the net debt:equity ratio to below 25%. The net debt:equity ratios at 28 February 2010 and 28 February 2009 were as follows:

Group Company

2010 2009 2010 2009

R R R R

Total borrowings 91 870 455 101 121 700 – –

Less: Cash and cash equivalents (32 129 480) (8 291 316) (3 007 820) (3 896 621)

Net debt 59 740 975 92 830 384 (3 007 820) (3 896 621)

Total equity 564 498 340 493 768 961 461 375 361 373 728 030

Total capital 624 239 315 586 599 345 458 367 541 369 831 409

Net debt to equity ratio (%) 10,6 18,8 (0,7 ) (1,0)


36. Financial risk management (continued)(e) Fair value estimation

Effective 1 March 2009, the group adopted the amendment to IFRS 7 for financial instruments that are measured in the statement of financial position at fair value, this requires disclosure of fair value measurements by level of the following fair value measurement hierarchy:

– Quoted prices (unadjusted) in active markets for identical assets or liabilities (level 1);

– Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices) (level 2); and

– Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (level 3).

The following table presents the group’s assets and liabilities that are measured at fair value at 28 February 2010.

Group Total

At 28 February 2010 Level 1 Level 2 Level 3 balance

Assets

Available-for-sale financial assets

– Equity securities 45 850 – – 45 850

– Environmental funds 1 681 850 – – 1 681 850

Total assets 1 727 700 – – 1 727 700

GroupAt 28 February 2009

Assets

Available-for-sale financial assets

– Equity securities 342 075 – – 342 075

– Environmental funds 3 385 790 – – 3 385 790

Total assets 3 727 865 – – 3 727 865

The group has no financial liabilities that are measured at fair value. The company has no financial assets or liabilities that are measured at fair value.

The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the group is the current bid price. These instruments are included in level 1. Instruments included in level 1 comprise primarily equity investments classified as available-for-sale.


Segmental Report For the year ended 28 February 2010

2010 2009

R % R %

Revenue

External sales

Aggregates 487 386 941 62,65 392 946 343 57,19

Readymix Concrete 188 295 362 24,20 194 369 835 28,29

Concrete Manufactured Products 102 333 549 13,15 99 774 603 14,52

778 015 852 100,00 687 090 781 100,00

Inter-segment sales

Aggregates 35 889 045 83,17 46 725 409 84,90

Readymix Concrete 554 205 1,28 688 221 1,25


43 156 041 100,00 55 036 574 100,00

Total revenue

Aggregates 523 275 986 63,72 439 671 752 59,24



821 171 893 100,00 742 127 355 100,00

Result

Operating profit before tax

Aggregates 83 632 654 76,78 57 062 479 60,04



Unsegmental profit 1 208 041 1,11 485 705 0,51

108 923 749 100,00 95 047 731 100,00

Operating profit margins on external revenue (%)

Aggregates 17,16 14,52

Readymix Concrete 6,23 8,80

Concrete Manufactured Products 12,07 20,45

14,00 13,83

Depreciation and amortisation

Aggregates 30 768 102 78,29 30 412 970 79,71


Concrete Manufactured Products 342 063 0,87 2 151 299 5,64

Unsegmental profit 572 410 1,45 156 475 0,40

39 302 036 100,00 38 156 636 100,00

Other information

Assets

Aggregates 473 694 915 56,17 464 477 517 61,55



Unsegmental 250 174 483 29,67 167 044 288 22,14

Consolidated total assets 843 286 618 100,00 754 581 483 100,00


2010 2009

R % R %

Liabilities

Aggregates 145 808 991 52,30 129 013 276 49,47



Unsegmental 98 214 958 35,23 89 626 682 34,36

Consolidated total liabilities 278 788 278 100,00 260 812 522 100,00

Capital expenditure (excluding acquisitions through business combinations)

Aggregates 29 201 523 76,67 99 149 660 81,09


Concrete Manufactured Products 6 730 0,02 9 184 997 7,51

Unsegmental 779 208 2,05 1 107 272 0,91

38 086 550 100,00 122 269 300 100,00

Unsegmental assets consist of the following unallocated assets:

Goodwill 101 331 899 101 331 899

Other financial assets 67 012 086 3 727 865

Deferred tax 4 569 767 –

Retirement benefit asset 12 671 745 11 792 354

Current tax receivable 5 223 395 10 593 068

Cash and cash equivalents 52 913 747 21 688 808

Other assets 6 451 844 17 910 294

250 174 483 167 044 288

Unsegmental liabilities consist of the following unallocated liabilities:

Provisions 13 160 285 12 009 256

Deferred tax 61 466 792 53 712 973

Current tax payable 158 565 7 306 778

Bank overdraft 20 784 267 13 397 492

Other liabilities 2 645 049 3 200 183

98 214 958 89 626 682

The group has elected that the entire Southern African region represents a single geographical area.


Analysis of ShareholdersAs at 28 February 2010

Number of Number

shareholders % of shares %

Shareholding1 – 1 000 shares 1 300 48,9 622 708 0,4

1 001 – 10 000 shares 1 090 41,0 3 880 221 2,7

10 001 – 100 000 shares 189 7,1 5 611 303 3,9

100 001 – 1 000 000 shares 49 1,9 17 129 532 12,0

1 000 000 shares and over 29 1,1 116 018 648 81,0

2 657 100,0 143 262 412 100,00

Analysis of holdingsNon-public shareholding

Directors 8 0,3 44 908 037 31,3

Treasury shares:

– Afrimat Share Incentive Trust 1 0,0 228 329 0,2

– Afrimat Aggregates (Operations) (Pty) Limited 1 0,0 3 169 951 2,2

Afrimat Empowerment Investments (Pty) Limited/Afrimat BEE Trust 1 0,1 24 050 000 16,8

11 0,4 72 356 317 50,5

Public shareholding 2 646 99,6 70 906 095 49,5

2 657 100,0 143 262 412 100,0

Major, founder and BEE shareholdersNumber of Number of

shares % BEE shares

Frans du Toit Trust 19 788 502 13,8

Mega Oils (Pty) Limited 6 239 529 4,4 6 239 529

Mega Oils SPV (Pty) Limited 6 392 575 4,5 6 392 575

Korum Trust (TCB Jordaan) 9 900 000 6,9

AJ van Heerden 5 475 026 3,8

ME van Heerden 1 206 043 0,8

PG Corbin 4 586 413 3,2

LP Korsten (indirect) 8 429 352 5,9

Afrimat Empowerment Investments (Pty) Limited/Afrimat BEE Trust 24 050 000 16,8 24 050 000

JHM Korsten 3 212 995 2,2

Investec Bank Limited 1 407 865 1,0

Joe Kalo Investments (Pty) Limited 738 234 0,5 738 234

91 426 534 63,8 37 420 338

Other 51 835 878 36,2

143 262 412 100,0

Share Performance


2010 2009

Market price per share at year-end (cents) 313 196

HEPS (cents) 51,3 40,5

Price:earnings ratio 6,1 4,8

Number of issued shares 143 262 412 133 762 412

Number of treasury shares 3 398 280 855 829

Market capitalisation based on issued shares (Rands) 448 411 350 262 174 328

Market capitalisation based on issued shares less treasury shares (Rands) 437 774 733 260 496 903

Listing date 7 November 2006

Shareholders’ Diary

Financial year-end 28 February 2010

Annual general meeting 4 August 2010

Announcement of annual results 13 May 2010

Annual report posted July 2010

Announcement of interim results November 2010


Notice of Annual General Meeting

Afrimat Limited


Share code: AFT

ISIN: ZAE000086302

(“Afrimat” or “the company”)

Notice is hereby given that the annual general meeting of Afrimat will be held at The Cedar Conference Room, Poplars Restaurant,

Racecourse Road, Durbanville, on Wednesday, 4 August 2010 at 14:00 for the purposes of:

• considering and adopting the annual financial statements of the company for the year ended 28 February 2010;

• re-electing directors;

• appointing auditors;

• considering and, if deemed fit, adopting, with or without modification, the special and ordinary resolutions set out below; and

• transacting any other business as may be transacted at an annual general meeting.

Special Resolutions

Special Resolution 1: general authority to repurchase company shares

“Resolved that the company and/or its subsidiaries be and is hereby authorised, by way of general authority, to acquire ordinary

shares issued by the company, in terms of sections 85(2), 85(3) and 89 of the Companies Act and in terms of the Listings

Requirements of the JSE Limited (“JSE”), being that:

• any such acquisition of ordinary shares shall be implemented on the open market of the JSE;

• any such acquisition is authorised by the company’s articles of association;

• this general authority shall only be valid until the company’s next annual general meeting, provided that it shall not extend

beyond 15 months from the date of the passing of this special resolution;

• an announcement will be published on SENS as soon as the company has acquired ordinary shares constituting, on a cumulative

basis, 3% (three percent) of the number of ordinary shares in issue prior to the acquisition, pursuant to which the aforesaid 3%

(three percent) threshold is reached, containing full details of such repurchases;

• acquisitions in the aggregate in any one financial year may not exceed 10% (ten percent) of the company’s ordinary issued share

capital nor may acquisitions in the aggregate, from the date of passing of this special resolution, exceed 10% (ten percent) of the

company’s ordinary issued share capital at the date of passing of this special resolution;

• in determining the price at which ordinary shares issued by the company are acquired by it in terms of this general authority, the

maximum premium at which such ordinary shares may be acquired will be 10% (ten percent) of the volume weighted average

price at which such ordinary shares are traded on the JSE, as determined over the five trading days immediately preceding the

date of repurchase of such ordinary shares by the company;

• at any point in time, the company will only appoint one agent to effect any repurchase(s) on the company’s behalf; and

• the company or its subsidiaries will not repurchase securities during a prohibited period in accordance with the JSE Listings

Requirements.”

Reason and effect of special resolution number 1

The reason for special resolution number 1 is to grant the company a general authority in terms of the Companies Act for the

acquisition by the company, or any of its subsidiaries, of shares issued by the company, or its holding company, which authority

shall be valid until the earlier of the next annual general meeting of the company or the variation or revocation of such general

authority by special resolution by any subsequent general meeting of the company, provided that the general authority shall

not extend beyond fifteen (15) months from the date of this annual general meeting. The passing and registration of this special

resolution will have the effect of authorising the company or any of its subsidiaries to acquire shares issued by the company or its

holding company.


The following additional information, some of which may appear elsewhere in the annual report of which this notice forms part, is

provided in terms of the JSE Listings Requirements for purposes of this general authority:

• directors and management – see pages 4 and 5 of the annual report;

• major beneficial shareholders – see page 72 of the annual report;

• directors’ interests in ordinary shares –see page 25 of the annual report; and

• share capital of the company – see page 24 of the annual report.

Litigation statement

The directors, whose names appear under board of directors on pages 4 and 5 of the annual report of which this notice forms part,

are not aware of any legal or arbitration proceedings, including proceedings that are pending or threatened, that may have or have

had in the recent past, being at least the previous twelve (12) months, a material effect of the financial position of the company or

its subsidiaries.

Directors’ responsibility statement

The directors, whose names appear under the board of directors on pages 4 and 5 of the annual report, collectively and individually

accept full responsibility for the accuracy of the information pertaining to this special resolution and certify that, to the best of their

knowledge and belief, there are no facts that have been omitted which would make any statement false or misleading and that all

reasonable enquiries to ascertain such facts have been made and that the special resolution contains all necessary information.

Material changes

Other than the facts and developments reported on in this annual report, there have been no material changes in the affairs or

financial position of the company and its subsidiaries since the date of signature of the audit report and up to the date of this

notice.

Statement by the board of directors of the company

Pursuant to, and in terms of, the JSE Listings Requirements, the board of directors of the company hereby state that:

(a) the intention of the directors of the company is to utilise the general authority to repurchase shares in the capital of the

company if, at some future date, the cash resources of the company are in excess of its requirements or there are other good

reasons for doing so. In this regard, the directors will take account of, inter alia, an appropriate capitalisation structure for the

company, the long-term cash needs of the company, and the interests of the company; and

(b in determining the method by which the company intends to repurchase its securities, the maximum number of securities to be

repurchased and the date on which such repurchase will take place, the directors of the company will ensure that:

• the company and its subsidiaries will, after the repurchase, be able to pay their debts as they become due in the ordinary course

of business for the next twelve (12) months after the date of notice of this annual general meeting;

• the consolidated assets of the company and its subsidiaries fairly valued and recognised and measured in accordance with the

accounting policies used in the latest audited financial statements, will, after the repurchase, be in excess of the consolidated

liabilities of the company and its subsidiaries for the next twelve (12) months after the date of this notice of the annual general

meeting;

• the issued share capital and reserves of the company and its subsidiaries will, after the repurchase, be adequate for the ordinary

business purposes of the company and its subsidiaries for the next twelve (12) months after the date of notice of this annual

general meeting; and

• the working capital available to the company and its subsidiaries will, after the repurchase, be sufficient for the ordinary business

requirements of the company and its subsidiaries for the next twelve (12) months after the date of this notice of annual general

meeting.


Notice of Annual General Meeting (continued)

Ordinary Resolutions

Ordinary Resolution 1: adoption of annual financial statements

“Resolved that the annual financial statements of the company for the year ended 28 February 2010 be and are hereby received

and adopted.”

Ordinary Resolution 2: issue of shares or other equity securities for cash

“Resolved that the directors be authorised pursuant inter alia to the company’s articles of association, until this authority lapses

at the next annual general meeting of the company, unless it is then renewed at the next annual general meeting of the company

provided that it shall not extend beyond 15 months, to allot and issue any equity securities (which shall include for the purpose of

this ordinary resolution 2, the grant or issue of options or convertible securities that are convertible into an existing class of equity

securities) for cash subject to the Listings Requirements of the JSE Limited (“JSE”) on the following bases:

(a) the allotment and issue of the equity securities must be made to persons qualifying as public shareholders as defined in the

JSE Listings Requirements and not to related parties;

(b) the equity securities which are the subject of the issue for cash must be of a class already in issue, or where this is not the

case, must be limited to such shares or rights that are convertible into a class already in issue;

(c) the number of equity securities issued for cash shall not in the aggregate in any one financial year exceed 15% (fifteen percent)

of the company’s issued share capital of ordinary shares. The number of ordinary shares which may be issued shall be based

on the number of ordinary shares in issue at the date of such application less any ordinary shares issued during the current

financial year, provided that any ordinary shares to be issued pursuant to a rights issue (announced, irrevocable and fully

underwritten) or acquisition (concluded up to the date of application including announcement of the final terms) may be

included as though they were shares in issue at the date of application;

(d) the maximum discount at which equity securities may be issued is 10% (ten percent) of the weighted average traded price on

the JSE of those equity securities over the 30 business days prior to the date that the price of the issue is determined or agreed

by the directors of the company;

(e) after the company has issued equity securities for cash which represent, on a cumulative basis within a financial year, 5%

(five percent) or more of the number of equity securities in issue prior to that issue, the company shall publish on SENS an

announcement containing full details of the issue (including the number of equity securities issued, the average discount to

the weighted average traded price of the equity securities over the 30 business days prior to the date that the price of the issue

is determined or agreed to by the directors and the effect of the issue on net asset value and earnings per share), or any other

announcements that may be required in such regard in terms of the JSE Listings Requirements which may be applicable from

time to time.”

In terms of the JSE Listings Requirements a 75% (seventy-five percent) majority of the votes cast by shareholders present or

represented by proxy at the annual general meeting must be cast in favour of ordinary resolution number 2 for it to be approved.

Ordinary Resolution 3: unissued ordinary shares

“Resolved that all the authorised but unissued ordinary shares in the capital of the company, be and are hereby placed at the

disposal and under the control of the directors, and that the directors be and are hereby authorised to allot, issue and otherwise

to dispose of all or any of such shares at their discretion, in terms of and subject to the provisions of the Companies Act, 1973

(Act No.61 of 1973), as amended and the Listings Requirements of the JSE Limited and subject to the proviso that the aggregate

number of ordinary shares which may be allotted and issued in terms of this ordinary resolution number 3, shall be limited to 10%

(ten percent) of the number of ordinary shares in issue from time to time.”

A majority of the votes cast by all shareholders present, or represented by proxy at the annual general meeting, will be required

to approve this resolution.

Ordinary Resolution 4: shares available for the Afrimat Share Incentive Scheme

“Resolved that the maximum number of shares authorised for purposes of the scheme shall not exceed 14 326 241 shares, being

10% (ten percent) of the number of ordinary shares in issue.”


In terms of the JSE Listings Requirements a 75% (seventy-five percent) majority of the votes cast by shareholders present or

represented by proxy at the annual general meeting must be cast in favour of ordinary resolution number 4 for it to be approved.

Ordinary Resolution 5: re-election of director

“Resolved that L Dotwana be re-elected as a director of the company.”

A brief curriculum vitae in respect of L Dotwana is set out on page 4 of the annual report of which this notice forms part.


“Resolved that F du Toit be re-elected as a director of the company.”

A brief curriculum vitae in respect of F du Toit is set out on page 4 of the annual report of which this notice forms part.


“Resolved that LP Korsten be re-elected as a director of the company.”

A brief curriculum vitae in respect of LP Korsten is set out on page 4 of the annual report of which this notice forms part.


“Resolved that PRE Tsukudu be re-elected as a director of the company.”

A brief curriculum vitae in respect of PRE Tsukudu is set out on page 5 of the annual report of which this notice forms part.

Ordinary Resolution 9: future directors’ remuneration

“Resolved that the non-executive directors be paid the following fixed fee per annum with effect from 1 March 2010:

Chairman of the board R392 000

Non-executive director R105 000

Audit Committee chairman R60 000

Audit Committee member R40 000

Remuneration and Nomination Committee chairman R39 000

Remuneration and Nomination Committee member R26 000

SHE Committee chairman R31 000

SHE Committee member R20 000

as well as a daily rate of R10 000 for non-executive directors utilised on extraordinary duties.”

Ordinary Resolution 10: appointment of auditors

“Resolved that the directors be and are hereby authorised to re-appoint the auditors, Mazars together with D Dollman as the

individual registered auditor, for the ensuing financial year and are authorised to fix the remuneration of the auditors.”

Ordinary Resolution 11: signature of documentation

“Resolved that a director of the company or the company secretary be and is hereby authorised to sign all such documentation and

do all such things as may be necessary for or incidental to the implementation of ordinary resolutions numbers 1 to 10 and special

resolution number 1 which are passed by the shareholders.”

Voting and proxies

A shareholder of the company entitled to attend and vote at the general meeting is entitled to appoint one or more proxies (who

need not be a shareholder of the company) to attend, vote and speak in his/her stead. On a show of hands, every shareholder of the

company present in person or represented by proxy shall have one vote only. On a poll, every shareholder of the company present

in person or represented by proxy shall have one vote for every share held in the company by such shareholder.

Dematerialised shareholders who have elected own-name registration in the sub-register through a Central Securities Depository

Participant (CSDP) and who are unable to attend but wish to vote at the annual general meeting, should complete and return the

attached form of proxy and lodge it with the transfer secretaries of the company.

Shareholders who have dematerialised their shares through a CSDP or broker rather than through own-name registration and

who wish to attend the annual general meeting must instruct their CSDP or broker to issue them with the necessary authority to

attend. If such shareholders are unable to attend, but wish to vote at the annual general meeting, they should timeously provide

their CSDP or broker with their voting instructions in terms of the custody agreement entered into between that shareholder and

his/her CSDP or broker.


Notice of Annual General Meeting (continued)

Forms of proxy may also be obtained on request from the company’s registered office. The completed forms of proxy must be

deposited at, posted or faxed to the transfer secretaries at the address below, to be received by no later than 14:00 on Monday,

2 August 2010. Any member who completes and lodges a form of proxy will nevertheless be entitled to attend and vote in person

at the general meeting should the member subsequently decide to do so.

By order of the board

Routledge Modise Incorporated practicing as Eversheds

Company Secretary

28 June 2010

Registered office Transfer secretaries

Tyger Valley Office Park No 2 Computershare Investor Services (Pty) Limited

Corner Willie van Schoor Avenue and Old Oak Road (Registration number 2004/00364/07)

Tyger Valley Ground Floor

7530 70 Marshall Street

(PO Box 5278, Tyger Valley, 7536) Johannesburg, 2001

Telephone: +27 21 917 8840 (PO Box 61051, Marshalltown, 2107)

Facsimile: +27 21 914 1174 Telephone: +27 11 370 5000

Facsimile: +27 11 688 5200


Form of Proxy

Afrimat Limited(Registration number 2006/022534/06)(“Afrimat Limited” or “the company”)Share code: AFTISIN: ZAE000086302

For use at the annual general meeting of the company to be held at The Cedar Conference Room, Poplars Restaurant, Race Course Road, Durbanville, on Wednesday, 4 August 2010 at 14:00 and at any adjournment thereof.

For use by the holders of the company’s certificated ordinary shares (“certified shareholder”) and/or dematerialised ordinary shares held through a Central Securities Depository Participant (“CSDP”) or broker who have selected own-name registration (“own-name dematerialised shareholders”). Additional forms of proxy are available from the transfer secretaries of the company.

Not for the use by holders of the company’s dematerialised ordinary shares who are not own-name dematerialised shareholders. Such shareholders must contact their CSDP or broker timeously if they wish to attend and vote at the annual general meeting and request that they be issued with the necessary authorisation to do so, or provide the CSDP or broker timeously with their voting instructions should they not wish to attend the annual general meeting in order for the CSDP or broker to vote thereat in accordance with their instructions.

I/We

(Full name in block letters)of

(Address)being a member/members of Afrimat Limited and holding ordinary shares in the company, hereby appoint1. of or failing him/her

2. of or failing him/her

3. the chairman of the annual general meeting,

as my/our proxy to act for me/us and on my/our behalf at the annual general meeting which will be held for the purpose of considering and, if deemed fit, passing, with or without modification, the special and ordinary resolutions to be proposed thereat and at any adjournment thereof; and to vote for and/or against the ordinary resolutions and/or abstain from voting in respect of the Afrimat Limited ordinary shares registered in my/our name(s), in accordance with the following instructions:

Number of votesFor* Against* Abstain*

Special resolutions:1. To give directors general authority to repurchase company sharesOrdinary resolutions:1. To adopt the 2010 annual financial statements2. To issue unissued shares for cash3. To place unissued shares under directors’ control4. To approve shares authorised for the share incentive scheme5. To re-elect L Dotwana as a director of the company6. To re-elect F du Toit as a director of the company7. To re-elect LP Korsten as a director of the company8. To re-elect PRE Tsukudu as a director of the company9. To approve the non-executive directors’ future remuneration10.To authorise the directors to re-appoint the auditors together with D Dollman as

the individual registered auditor and to fix their remuneration11.To authorise the directors or the company secretary to sign documentation

* Please indicate with an “X” in the appropriate spaces above how you wish your votes to be cast.

Unless otherwise instructed, my/our proxy may vote as he/she thinks fit.

Signed at (place) on (date) 2010

Member’s signature Assisted by (if applicable)

Please read the notes on the reverse side.


Notes

1. This form of proxy is to be completed only by those members who are:

(a) holding shares in a certificated form; or(b) recorded in the sub-register in electronic form in their “own name”.

2. Members who have dematerialised their shares, other than “own-name” dematerialised shareholders, and who wish to attend the annual general meeting must contact their Central Securities Depository Participant (“CSDP”) or broker who will furnish them with the necessary authority to attend the annual general meeting, or they must instruct their CSDP or broker as to how they wish to vote in this regard. This must be done in terms of the agreement entered into between the members and their CSDP or broker.

3. Each member is entitled to appoint one or more proxies (who need not be a member(s) of the company) to attend, speak and, on a poll, vote in place of that member at the annual general meeting.

4. A member may insert the name of a proxy or the names of two alternative proxies of the member’s choice in the space provided, with or without deleting “the chairman of the annual general meeting”. The person whose name stands first on the form of proxy and who is present at the annual general meeting will be entitled to act as proxy to the exclusion of those whose names follow.

5. A member’s instructions to the proxy must be indicated by the insertion of the relevant number of votes exercisable by that member in the appropriate box(es) provided. Failure to comply with the above will be deemed to authorise the chairman of the annual general meeting, if the chairman is the authorised proxy, to vote in favour of the ordinary resolutions at the annual general meeting, or any other proxy to vote or to abstain from voting at the annual general meeting as he/she deems fit, in respect of all the member’s votes exercisable thereat.

6. A member or his/her proxy is not obliged to vote in respect of all the ordinary shares held by such member or represented by such proxy, but the total number of votes for or against the ordinary resolutions and in respect of which any abstention is recorded may not exceed the total number of votes to which the member or his/her proxy is entitled.

7. Documentary evidence establishing the authority of a person signing this form of proxy in a representative capacity must be attached to this form of proxy, unless previously recorded by the company’s transfer office or waived by the chairman of the annual general meeting.

8. The chairman of the annual general meeting may reject or accept any form of proxy which is completed and/or received other than in accordance with these instructions, provided that he is satisfied as to the manner in which a member wishes to vote.

9. Any alterations or corrections to this form of proxy must be initialled by the signatory(ies).

10. The completion and lodging of this form of proxy will not preclude the relevant member from attending the annual general meeting and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof, should such member wish to do so.

11. A minor must be assisted by his/her parent/guardian unless the relevant documents establishing his/her legal capacity are produced or have been registered by the company’s transfer secretaries.

12. Where there are joint holders of any shares, only that holder whose name appears first in the register in respect of such shares need sign this form of proxy.

13. Forms of proxy must be lodged with the transfer secretaries at the address given below by no later than 14:00 on Monday, 2 August 2010:

Computershare Investor Services (Pty) LimitedGround Floor70 Marshall StreetJohannesburg, 2001PO Box 61051 Marshalltown, 2107Telephone: +27 11 370 5000Facsimile: +27 11 688 5200

Administration

Afrimat Limited(Registration number 2006/022534/06)

Registered office

Tyger Valley Office Park No. 2

Corner Willie van Schoor Avenue and Old Oak Road

Tyger Valley, 7530

(PO Box 5278, Tyger Valley, 7536)

Telephone: +27 21 917 8840

Facsimile: +27 21 914 1174

Email: [email protected]

Website: www.afrimat.co.za

Company secretary

Routledge Modise Incorporated practising as Eversheds

22 Fredman Drive

Sandton, 2146

(PO Box 78333, Sandton City, 2146)

Telephone: +27 11 523 6110

Facsimile: +27 86 674 8658

Attorneys

Webber Wentzel

10 Fricker Road,

Illovo, 2196


Telephone: +27 11 530 5000

Facsimile: + 27 11 530 5111

Transfer secretaries

Computershare Investor Services (Pty) Limited


Ground Floor, 70 Marshall Street,

Johannesburg, 2001


Telephone: +27 11 370 5000

Facsimile: +27 11 688 5200

Sponsor

Bridge Capital Advisors (Pty) Limited

2nd Floor, 27 Fricker Road, Illovo, 2196

(PO Box 651010, Benmore, 2010)

Telephone: +27 11 268 6231

Facsimile: +27 11 268 6538

Auditors

Mazars

Mazars House, Rialto Road, Grand Moorings

Precinct, Century City, 7441

(PO Box 2817, Cape Town, 8000)

Telephone: +27 21 818 5000

Facsimile: +27 21 818 5001

Commercial bankers

The Standard Bank of South Africa Limited

Business Banking

12th Floor, East Towers, Bedford Centre

Corner Bradford and Smith Streets

Bedfordview, 2047

(Private Bag X23, Garden View, 2047)

Telephone: +27 11 601 4536/5

Facsimile: +27 11 631 8132

Maxx Corporate Communications

Page

Financial Highlights .................................................................... 1

Company Profile .......................................................................... 2

Directorate .................................................................................. 4

Chairman’s Report ...................................................................... 6

CEO’s Report ............................................................................... 8

Sustainability Report ................................................................ 10

Corporate Governance Report .................................................. 13

Audit Committee Report ........................................................... 20

Value Added Statement ............................................................ 21

Annual Financial Statements ................................................... 22

Directors’ Statement of Responsibility .............................. 22

Declaration by Company Secretary .................................... 22

Report of the Independent Auditors .................................. 23

Directors’ Report ................................................................ 24

“ASPASA” Aggregate and Sand Producers

Association of South Africa

“B-BBEE” Broad-based black economic

empowerment

“the board” The board of directors of

Afrimat Limited

“CSDP” Central Securities

Depository Participant

“CEO” Chief Executive Officer

“the Codes” Department of Trade and Industry’s

B-BBEE Codes of Good Practice

“the company” or “Afrimat” Afrimat Limited

“DIFR” Disabling Injury Frequency Rate

“EMP” Environmental Management

Programme

“EXCO” Executive Committee

“FD” Financial Director

“Glen Douglas” Glen Douglas Dolomite (Pty) Limited

“the group” Afrimat Limited and its subsidiaries

“HDI” Historically Disadvantaged Individual

“HEPS” Headline earnings per share

“HIRA” Hazard Identification Risk Assessment

Contents

Definitions

Page

Statement of Financial Position ......................................... 28

Income Statement .............................................................. 29

Statement of Comprehensive Income................................ 30

Statement of Changes in Equity ......................................... 31

Statement of Cash Flows ................................................... 33

Notes to the Annual Financial Statements ........................ 34

Segmental Report .............................................................. 70

Analysis of Shareholders ................................................... 72

Share Performance ................................................................... 73

Shareholders’ Diary .................................................................. 73

Notice of Annual General Meeting ........................................... 74

Form of Proxy ............................................................................ 79

Administration ........................................................................ IBC

“IFRS” International Financial

Reporting Standards

“IT” Information Technology

“JSE” JSE Limited

“King II Report” King Report on Corporate


“King III Report” King Report on Corporate


“Prima” Afrimat Aggregates (Operations)

(formerly Prima Klipbrekers)

(Pty) Limited

“the previous/prior year” The year ended 28 February 2009

“SA” South Africa

“SENS” Stock Exchange News Service

“SARMA” South African Readymix Association

“SHE Committee” Safety, Health and

Environmental Committee

“SWP” Safe Working Procedure

“the year” or

“the year under review” The year ended 28 February 2010

Editorial:

www.afrimat.co.za

Growth through unity

Annual Report 2010

AFR

IMA

T AN

NU

AL R

EPO

RT 2010

afrimat annual report 2010 annual report 2010 · growth through unity annual report 2010 afrimat...

Documents