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This Abridged Circular is neither a prospectus nor an invitation to the public to subscribe for shares in Afdis or the Company, but is an offer to existing Afdis Shareholders to acquire additional shares in Afdis on the terms and conditions set out in this Abridged Circular. The Directors of Afdis, whose names appear hereunder, collectively and individually accept full responsibility for the accuracy of the information contained in this Abridged Circular and further confirm that they have made all reasonable enquiries and declare that to the best of their knowledge and belief there are no facts, the omission of which would make any statement in this Abridged Circular false or misleading. Action required: If you are in any doubt as to the action you should take, please consult your stockbroker, banker, accountant or other professional advisor immediately. If you no longer hold any shares in Afdis, you should send this Abridged Circular, as soon as possible, to the stockbroker, bank or other agent through whom the sale of your shares in Afdis was executed for onward delivery to the purchaser or transferee of your shares.
(Incorporated in Zimbabwe on 17 November 1950 under Company Registration Number 138/1950) Directors: J .S. Mutizwa (Chairman); A. Chitapi (Sales, Marketing and Distribution Director)*; C. Z. Gombera (Managing Director)*; C. Z. Guyo (Operations Director)*; M. J. Hollingworth; S .W. Klopper; R. H. M. Maunsell; M. L. Ndachena (Finance Director)*; S. V. Rushwaya; G. J. Schooling; M. M. Valela; . (*Executive) Address: St Marnocks, Stapleford, Harare, Zimbabwe
Sponsoring Brokers
Reporting Accountants
Transfer Secretaries
African Distillers Limited statement of cash flows Cash flow from operating activities Profit/(loss) before interest and taxation Non-cash items Cash utilised in operations after non-cash items Changes in working capital Cash generated from/(utilised in) operations Interest expense paid Income tax paid Net cash outflow from operating activities Cash flow from investing activities Property, plant and equipment Increase in long term advances Net Cash Outflow from Investing Activities Net cash outflow from investing and operating activities Cashflow from financing activities Increase in short-term borrowings Net Movement in Cash and Cash Equivalents Cash and cash equivalents at beginning of the year Cash and Cash Equivalents at End of the Year Comprising: Bank balances and cash
2013 US$ 1,468,235 503,179 1,971,414 (2,128,521) (157,107) (286,541) (394,742) (838,390) (439,590) (160,462) (600,052) (1,438,442)
2012 US$ 1,588,491 551,414 2,139,905 (2,033,071) 106,834 (170,153) (63,319) (377,817) (202,581) (580,398) (643,717)
2011 US$ (511,718) (55,567) (567,285) 579,417 12,132 (84,596) (72,464) 47,582 (143,233) (95,651) (168,115)
2010 US$ (2,406,836) 316,517 (2,090,319) 1,609,317 (481,002) (48,524) (529,526) (29,393) (51,210) (80,603) (610,129)
Every person present and entitled to vote at the EGM shall, on a show of hands, have one vote only, but in the event of a poll, every share shall have one vote. Signed at _______________ on _____________________________________________2013 Signature(s)__________________________________________________________________ Assisted by me _______________________________________________________________ Full name(s) of signatory/ies if signing in a representative capacity (see note 2). (PLEASE USE BLOCK LETTERS). Notes to the form of proxy
(Incorporated in Zimbabwe on 17 November 1950 under Company Registration Number 138/1950) Address: St Marnocks, Stapleford, Harare, Zimbabwe NOTICE OF AN EXTRAORDINARY GENERAL MEETING of the Members of African Distillers Limited (the Company) will be held at the Registered Office of the Company, St Marnocks, Stapleford, Harare on Monday 9 December 2013 at 10:00 hours. Members will be asked to consider, and if deemed fit, to pass with or without modification, the resolutions set out below:-
INSTRUCTIONS FOR SIGNING AND LODGING THIS FORM OF PROXY 1. A shareholder may insert the name of a proxy or the names of two alternative proxies of the shareholders choice in the space provided, with or without deleting the Chairman of the EGM, but any such deletion must be initialed by the shareholder. The person whose name appears first on the form of proxy will, unless his/her name has been deleted, be entitled to act as proxy to the exclusion of those whose names follow. 2. A shareholders instructions to the proxy must be indicated by the insertion of the relevant number of votes exercisable by that shareholder in the appropriate space/s provided as well as by means of a cross whether the shareholder wishes to vote, for, against or abstain from the resolutions. Failure to comply with the above will be deemed to authorize the proxy to vote or abstain from voting at the EGM as he/she deems fit in respect of the entire shareholders votes exercisable threat. A shareholder or his/her proxy is not obliged to use all the votes exercisable by the shareholder or by his/her proxy, or cast them in the same way. 3. A deletion of any printed matter and the completion of any blank spaces need not be signed or initialed. Any alteration or correction must be initialed by the signatory/ies. 4. The Chairman shall be entitled to decline to accept the authority of a person signing the proxy form: i. under a power of attorney; ii. on behalf of a company unless that persons power of attorney or authority is deposited at the offices of the Companys transfer secretaries, or the registered office of the Company, not less than 48 hours before the meeting. 5. If two or more proxies attend the meeting then that person attending the meeting whose name appears first on the proxy form and whose name is not deleted, shall be regarded as the validly appointed proxy. 6. When there are joint holders of shares, any one holder may sign the form of proxy. In the case of joint holders, the senior who tenders a vote will be accepted to the exclusion of other joint holders. Seniority will be determined by the order in which names stand in the register of members. 7. The completion and lodging of this form of proxy will not preclude the member who grants this proxy form from attending the EGM and speaking and voting in person thereat to the exclusion of any proxy appointed in terms hereof should such member wish to do so. 8. In order to be effective, completed proxy forms must reach the Companys transfer secretaries or the registered office of the Company not less than 48 hours before the time appointed for the holding of the EGM. 9. Please ensure that name(s) of the member(s) on the form of proxy and the voting form are exactly the same as those on the share register. 10. Please be advised that the number of votes a member is entitled to will be determined by the number of shares recorded on the Share Register by 10:00 hours on 6 December 2013.
ORDINARY RESOLUTIONS 1. Renounceable Rights Offer That the Directors of the Company be and are hereby authorised to raise US$5,000,000 (five million United States dollars only) by offering 15,451,174 (fifteen million four hundred and fifty one thousand one hundred and seventy four) ordinary shares of US$0.01 (zero comma zero one United States dollars) nominal value each in the Companys authorised and unissued share capital to existing holders of the Companys ordinary shares as at the close of business on Friday 6 December 2013 (the Record Date) at a subscription price of US$0.3236 (zero comma three two three six United States dollars only) per ordinary share, on the basis of 1 (one) new ordinary share for every 6.21 (six comma two one) ordinary shares already held as at the Record Date, and to issue and allot such shares as may be subscribed to pursuant to the Rights Offer to such shareholders, their renouncees, or the Underwriter as the case may be. 2. To place unissued shares under the control of the Directors That the balance of the authorised but unissued shares of the company after the proposed Rights Offer be placed under the control of the Directors of the Company for an indefinite period to be issued in compliance with the Companys Memorandum and Articles of Association and the regulations of the Zimbabwe Stock Exchange provided that no issue would be made which would effectively transfer the control of the Company without the prior approval of Shareholders in General Meeting. 3. Directors authority to give effect to the above resolutions That the Directors of the Company be and are hereby authorised to do all such things as may generally be necessary to give effect to the above.
Issued Unissued
Authorized
95,903,850 54,096,150
150,000,000
111,355,024 38,644,976
150,000,000
Application Repayment of shareholder loan Balance on bottling plant & ancillary equipment Transaction costs Total
5. CONDITIONS PRECEDENT TO THE TRANSACTION
The proposed Rights Offer is subject to the following Conditions Precedent:
the approval by the members of Afdis of the Resolutions at the EGM to be held on Monday 9 December 2013 in terms of the Notice of the EGM set out below; the approval of the ZSEs Listing Committee of the listing of the new Afdis Shares to be issued in fulfillment of the Rights Offer as contemplated in this Abridged Circular; the approval of the Exchange Control authorities of the Transaction; and the Underwriting Agreement entered into between the Company and Afdis Holdings (Private) Limited otherwise becoming unconditional in all respects and not having been terminated in accordance with its terms prior to the closing date of the Rights Offer.
7. FINANCIAL HIGHLIGHTS
Audited financial information in respect of the year ended 30- June 2013 is set out below:
Statement of comprehensive income
African Distillers Limited statement
9. DIVIDEND POLICY
2013 2012 US$ US$ 22,091,417 19,547,604 (12,435,958) (11,477,261) 9,655,459 8,070,343 67,643 32,334 (707,479) (536,014) (1,232,512) (901,819) (6,122,199) (5,501,400) 1,660,912 1,163,444 (265,373) (286,541) (170,153) 104,129 672,504 1,213,127 1,665,795 (404,360) (522,112) 808,767 1,143,683 808,767 1,143,683 2011 US$ 15,030,013 (9,360,314) 5,669,699 54,423 (188,825) (837,324) (4,467,287) 230,686 (742,404) (460,453) (972,171) 39,971 (932,200) (932,200) 2010 US$ 12,050,383 (9,123,737) 2,926,646 83,321 (134,693) (553,244) (3,802,862) (1,480,832) (926,004) (57,204) (2,464,040) 927,242 (1,536,798) (1,536,798)
The Companys policy is to pay dividends based on 3 times cover where the Companys performance can justify such a distribution. The Company still needs to preserve cash in order to consolidate its working capital requirements and attend to basic factory upgrades. In view of these immediate needs, no dividend is anticipated in the current financial year.
By order of the Board L. Mutamuko Company Secretary St Marnocks Stapleford Harare Zimbabwe 18 November 2013
PROXY FORM Members are notified that they are entitled to appoint one or more proxies, who need not be a member of the Company, to act in their alternative, to attend, speak and vote in his/her stead at the EGM. Proxies must be lodged at the Registered Office of the Company at least forty-eight hours before the meeting.
I/We ________________________________________________________________________________ (Name in block letters) Of __________________________________________________________________________________ Being the holder of _____________________________________ Shares in the Company hereby appoint 1._____________________________ of _____________________________________ or failing him/her 2._____________________________ of _____________________________________ or failing him/her 3. the Chairman of the EGM. As my/our proxy to act for me/us at the EGM for the purpose of considering and, if deemed fit, passing, with or without modification, the resolutions to be proposed thereat, and at each adjournment or postponement thereof, and to vote for and/or against the resolutions and/or abstain from voting in respect of the shares in the issued share capital of the Company registered in my/our name (see note 2) in accordance with the following instructions:
of comprehensive income Revenue Cost of sales Gross profit Other income Distribution costs Administration expenses Other operating expenses Operating income/(loss) Reorganisation costs Interest expenditure Exchange Gains Profit/(loss) before tax Taxation Profit/(loss) for the year Other comprehensive income Total comprehensive income
Earnings/(loss) per share (Cents):
56 42 44 53
19 Trail Road, Mount Pleasant, Harare 6 Glenelg Road Avenue, Borrowdale West, Harare 1032 Charlotte Brooke, Borrowdale, Harare 119 Brookeview, Borrowdale, Harare
Managing Director Finance Director Sales, Marketing & Distribution Operations Director
The following documents or certified copies thereof are available for inspection at the Registered Offices of Afdis, St Marnocks, Stapleford, Harare, during normal business hours, on weekdays until the date of the EGM. the Memorandum and Articles of Association of Afdis; the audited financial statements of Afdis for the years ending 30 June 2010, 2011, 2012 and 2013; the original signed copy of the Circular to Shareholders; the Underwriting Agreement between Afdis and Afdis Holdings (Private) Limited; the Accountants' Reports; and the Experts consents.
Event
Notice of EGM published Abridged Circular to Afdis Shareholders published Circular to Shareholders posted Last date for lodging proxy forms (10:00 hours) Afdis share register closes (at 16:00 hours) Record Date (at 16:00 hours) Securities listed ex-rights EGM (at 10:00 hours) EGM results published Letters of Allocation mailed to Shareholders Rights Offer opens (at 10:00 hours) Dealing in Letter of Allocation commences Last day of dealing in Letters of Allocation (at 16:00 hours) Last day of splitting Letters of Allocation (at 16:00 hours) Rights Offer closes Last day for payment (at 16:00 hours) Announcement of the results of the Right Offer Rights Offer Shares issued and listed
Notes:
Date
Monday, 18 November 2013 Monday, 18 November 2013 Monday, 18 November 2013 Friday, 6 December 2013 Friday, 6 December 2013 Friday, 6 December 2013 Monday, 9 December 2013 Monday, 9 December 2013 Wednesday, 11 December 2013 Wednesday, 11 December 2013 Monday, 16 December 2013 Monday, 16 December 2013 Wednesday, 8 January 2014 Thursday, 9 January 2014 Friday, 10 January 2014 Wednesday, 15 January 2014 Monday, 20 January 2014
Resolutions
For 1. Renounceable Rights Offer That the Directors of the Company be and are hereby authorised to raise US$5,000,000 (five million United States dollars only) by offering 15,451,174 (fifteen million four hundred and fifty one thousand one hundred and seventy four) ordinary shares of US$0.01 (zero comma zero one United States dollars) nominal value each in the companys authorised and unissued share capital to existing holders of the Companys ordinary shares as at the close of business on Friday 6 December 2013 (the Record Date) at a subscription price of US$0.3236 (zero comma three two three six United States dollars only) per ordinary share, on the basis of 1 (one) new ordinary share for every 6.21 (six comma two one) ordinary shares already held as at the Record Date, and to issue and allot such shares as may be subscribed to pursuant to the Rights Offer.
Number of votes
Against Abstain
898,473
1,009,236
487,124
527,095
2. To place unissued shares unde r the control of the Directors. That the balance of the authorised but unissued shares of the company after the proposed Rights Offer be placed under the control of the Directors of the Company for an indefinite period to be issued in compliance with the Companys Memorandum and Articles of Association and the regulations of the Zimbabwe Stock Exchange provided that no issue would be made which would effectively transfer the control of the Company without the prior approval of Shareholders in General Meeting. 3. Directors authority to give effect to the above resolutions. That the Directors of the Company be and are hereby authorised to do all such things as may generally be necessary to give effect to the above.
in Shareholders' equity
Deemed balance at 30 June 2009 Total comprehensive loss for the Year Balance at 30 June 2010 Redenomination of share capital Total comprehensive loss for the Year Balance at 30 June 2011 Recognition of share based payment expense Total comprehensive income for the year Balance at 30 June 2012 Recognition of share based payment expense Total comprehensive income for the year Balance at 30 June 2013
Share capital Share option US$ US$ 1 1 952,038 952,039 62,548 952,039 62,548 93,720 952,039 156,268
Non-distributable Accumulated loss reserve US$ US$ 6,313,447 (1,536,798) 6,313,447 (1,536,798) (952,038) (932,200) 5,361,409 (2,468,998) 1,143,683 5,361,409 (1,325,315) 808,767 5,361,409 (516,548)
The above mentioned dates are subject to change and any such change will be published in the Zimbabwean press.
Total
US$ 6,313,448 (1,536,798) 4,776,650 (932,200) 3,844,450 62,548 1,143,683 5,050,681 93,720 808,767 5,953,168
The Rights Offer timetable is subject to Shareholder approval at the EGM to be held on 9 December 2013.