Integrated Annual Report - ETION · highlights revenue increased to r474 million from r251 million (up 88,8%) ebitda improved to r42,8 million from r19,5 million (up 119,6%) profit

Integrated Annual Report

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INDEX

OUR GROUP

Highlights for FY2016 2Our competitive strengths 3About this report 4Group snapshot 8Our vision 10Our values and how we live them 10Our history 11Chairman’s report 12Group CEO’s report 15

HOW WE ADD VALUE

Value added statement 21Business segment review 22Our business model and strategy 26Material issues 27Our stakeholders 28

LEADERSHIP

Board of directors 32Executive Committee 34Directorate 36

PERFORMANCE

Group CFO’s report 42Five-year review 44Corporate governance 47Risk management 56

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5 THE IMPACTS OF OUR BUSINESS

Social and Ethics Committee report 60Human Capital and Remuneration Committee report 63Transformation 66Our people 69

ANNUAL FINANCIAL STATEMENTS

Directors’ responsibilities and approval 72Certificate from the Company Secretary 72Audit and Risk Committee report 73Directors’ report 75Independent auditor’s report 77Statements of financial position 78Statements of comprehensive income 79Statements of changes in equity 80Statements of cash flows 81Notes to the annual financial statements 82

SHAREHOLDER INFORMATION

Share performance 126Analysis of shareholders 127Notice of annual general meeting 128Shareholders’ diary 138Form of proxy 139Election form 141Definitions 143Contacts IBC

INTEGRATED ANNUAL REPORT

20161

HIGHLIGHTS

REVENUE INCREASED TO R474 MILLION FROM R251 MILLION (UP 88,8%)

EBITDA IMPROVED TO R42,8 MILLION FROM R19,5 MILLION (UP 119,6%)

PROFIT AFTER TAX IMPROVED TO R19,9 MILLION FROM R10 MILLION (UP 99,2%)

HEPS INCREASED TO 4,86 CENTS FROM 4,44 CENTS (UP 9,5%)

BASIC EARNINGS PER SHARE INCREASED TO 4,86 CENTS FROM 4,09 CENTS (UP 18,8%)

TANGIBLE NET ASSET VALUE INCREASED TO 17,5 CENTS FROM 10,4 CENTS (UP 68%)

HIGHLIGHTS


20162

OUR COMPETITIVE STRENGTHS

CENTRE FOR ENGINEERING EXCELLENCE

STATE OF THE ART PRODUCTION FACILITY

IN-HOUSE INTELLECTUAL AND TECHNOLOGY CAPITAL

LEVEL 2 B-BBEE, BLACK-OWNED AND CONTROLLED – 43,84% BLACK OWNERSHIP – 19,33% BLACK WOMEN OWNERSHIP

DIVERSIFIED IN MARKETS AND CAPABILITIES

SOLID CLIENT BASE AND ESTABLISHED REPUTATION

INNOVATIVE START-TO-FINISH SOLUTIONS

SOLID STRATEGIC PRODUCT PARTNERSHIPS

OUR COMPETITIVE STRENGTHS


20163

ABOUT THIS REPORT

Ansys Limited is a black-owned and controlled

technology company specialising in the design and

development of engineering solutions for the defence

and information security, mining and industrial, rail and

telecommunications industries.

This, our fifth integrated annual report (“IAR”), presents the

performance of the group for the period 1 March 2015 to

31 March 2016, and follows our prior integrated report

published in July 2015. The information disclosed encompasses

all business segments and subsidiaries of the company.

These same entities are included in the company’s

consolidated financial statements as set out on pages 78

to 123 of this report.

The content included in this integrated annual report

endeavours to identify and explain the material issues faced by

the group in terms of Ansys’ economic, environmental, social

and governance performance. This should enable the group’s

stakeholders to accurately evaluate Ansys’ ability to create and

sustain value over the short, medium and long term.

This integrated report is our primary report to our stakeholders.

All significant items are reported on a like-for-like basis with no

major restatement.

SIGNIFICANT EVENTS DURING THE PERIOD Ansys has successfully implemented and consolidated its

turnaround strategy with revenue up 88,8% to R474 million

from R251,1 million in the 2016 financial period with profit after

tax for the period having improved from R10 million in the

previous financial year to R19,9 million in 2016. The group’s

HEPS increased from 4,44 cents to earnings of 4,86 cents.

The group’s 2016 financial results have a ten months inclusion

of our recent acquisition Parsec Holdings Proprietary Limited

and its subsidiaries (“Parsec Holdings”), which has also

provided the group with a strong foothold and a broader

portfolio of solutions to our mining and industrial, rail,

telecommunications and defence sectors and introduced

information security to our portfolio.

During the period under review, the company changed its

financial year-end to 31 March from 28 February.

CORPORATE INFORMATIONThe group’s executive directors are Teddy Daka (Group CEO),

Burt Lamprecht (Group CFO) and Rynier van der Watt

(Chief: Strategy, mergers and acquisitions).

Key data

Ansys Limited

Registration no.: 1987/001222/06

ISIN: ZAE00097028

JSE AltX

Share code: ANS

Listing date: 7 June 2007

Shares in issue (at period-end): 461 038 321

Registered office: 140 Bauhinia Street, Highveld Techno Park,

Centurion, Pretoria, South Africa

PROCESS FOR DEFINING REPORT CONTENTThe leadership of the group developed and directed the

strategy and managed the business in an integrated manner,

this whilst being cognisant of the interests of all our

stakeholders. This is demonstrated throughout our IAR for

the period 31 March 2016.

Ansys has considered and applied many of the

recommendations contained in the International Integrated

Reporting Framework issued in December 2013. The company

has also applied the principles in the King III Report as set out

on page 54.

The annual financial statements have been prepared in

accordance with IFRS, the JSE Listings Requirements and

the SAICA Financial Reporting Guides as issued by the

Accounting Practices Committee and the requirements of

the Companies Act.


20164

ASSURANCEIt is the responsibility of the board to ensure the integrity of the integrated annual report. The board has applied its mind

accordingly and is of the opinion that the report addresses all material issues and presents fairly the integrated performance of the

group and its social and environmental impacts. In addition, the following assurances have been undertaken:

NATURE OF ASSURANCE ASSURANCE PROVIDER

Business process

External audit Independent audit PricewaterhouseCoopers Inc.

Empowerment

Employment equity Employment Equity submission Department of LabourB-BBEE B-BBEE Audit Verification EmpowerLogic

Aqua BEE

Quality

External quality assurance audit ISO 9001:2008 SABS

DEKRA

NOSA

A hard copy of this integrated annual report is available on request from the Company Secretary, and is also posted online at

www.ansys.co.za.

For additional contact details please see inside of the back cover.

Throughout our reporting process, we seek to move beyond compliance and enter into an inclusive and meaningful dialogue with

our stakeholders.

We welcome your feedback and any suggestions you may have to enhance our future reports.


20165

OUR GROUP

Because we innovate in-house and our manufacturing is mainly local,

we are contributing to South Africa’s goal to be at the forefront of technology

and industrial space

PRODUCTS AND SERVICES• Mobile Rope Testing

Solutions

• Bespoke electronic

hardware and software

development, including:

– Gas detection

instruments

– Collision awareness

systems

– Management software

• Electronic Contract

Manufacturing Services,

including:

– Development of related

test equipment

– Product

industrialisation

MINING AND INDUSTRIAL

20

16

12

8

4

0

-4 2016 2015R4 029 (R2 360)

SEGMENT PROFIT /LOSS(R’000)

2016 2015R42 548 R2 112

220 200 180 160 140 120 100 80 60 40 20

0

REVENUE (R’000)

CONTRIBUTION TO REVENUE AND PROFIT

DEFENCE AND INFORMATION SECURITY

REVENUE (R’000)

2016 2015R90 145 R9 993

220 200 180 160 140 120 100 80 60 40 20

0

SEGMENT PROFIT (R’000)20 18 16 14 12 10 8 6 4 2 0

2016 2015R15 997 R1 562

PRODUCTS AND SERVICES • Information Security – Secure Security Network

Solutions – User security in the

form of USB based authentication, encryption and digital signing solutions

• Embedded solutions and mission computers

• Weapon integration and weapon control systems

• System design and integration

• Bespoke electronic hardware and software development

• Test equipment • Electronic Contract

Manufacturing Service

GROUP SNAPSHOT

OUR VALUE PROPOSITION We are an ODM that specialises in the design, development, manufacturing, integration and support of advanced technology systems and products in the mining and industrial sector: which are aimed at improving the health and safety environment and competitiveness of our clients.

OUR VALUE PROPOSITION We are an original design manufacturer (“ODM”) that develops, produces and integrates bespoke electronic subsystems and products for clients in the defence, aerospace and information security sectors. Our products and services are strategically aligned to the long-term needs of clients in these industry sectors.


GROUP’S BUSINESS SEGMENTS

RAILMINING AND INDUSTRIAL

DEFENCE AND INFOSEC

TELECOMS


20168

PRODUCTS AND SERVICES • Distribution of fibre and

data cabling infrastructure

• Radio frequency products

• Wireless network design,

implementation and

operation

• Data centre design and

implementation

• Structured cabling and

fibre reticulation

• Network and equipment

monitoring solutions

• Installation, maintenance

and support services

TELECOMS

PRODUCTS AND SERVICES Trackside Systems• Vehicle identification• Hot bearing detection• Load profile monitoring• Integrated train condition

monitoring system• RF ID tags• Smart pass readers• Vandal proof solar power

solution

Onboard Systems• Integrated displays• Auxiliary displays Train communication• Train definition unit• Asset tracking

RAIL

REVENUE (R’000)

2016 2015R137 016 R94 109

220 200 180 160 140 120 100 80 60 40 20

0

SEGMENT PROFIT (R’000)20 18 16 14 12 10 8 6 4 2 0

2016 2015R15 871 R17 099

2016 2015R204 357 R144 907

220 200 180 160 140 120 100 80 60 40 20

0

REVENUE (R’000)

20 18 16 14 12 10 8 6 4 2 0

2016 2015R6 130 R7 115

SEGMENT PROFIT (R’000)

GROUP VALUE PROPOSITIONWe produce, develop, distribute and integrate technology-driven engineering solutions for harsh environments to improve our clients’ productivity and safety. Our range of standard and bespoke solutions is currently aimed at the defence and information security, mining and industrial, rail and telecoms sectors.

With our engineering excellence and extensive technical and business experience, we offer a mature engineering process and proven capability to implement our customers’ technical requirements.

CLIENT PORTFOLIO The company’s client portfolio extends throughout Southern Africa and the Middle East with the strategic intent to expand further.

LEVEL 2 B-BBEE

ISO 9001:2008 ACCREDITED

LEVEL 7 CONSTRUCTION INDUSTRY DEVELOPMENT BOARD (“CIDB”) RATING

ALTX-LISTED

OUR VALUE PROPOSITION We develop, produce and integrate world class technology-driven health monitoring and train communication rail solutions that improve the productivity and safety of our clients.

OUR VALUE PROPOSITION We design, install, commission, distribute and integrate high quality telecommunications products and solutions that enhance the network integrity of our clients.




20169

VISION AND VALUES

OUR VISION

To become an IP-led provider of technology-driven engineering solutions, to produce world class products for global distribution and

continually enhance the competitiveness of our clients through high quality innovative solutions.

OUR VALUES AND HOW WE LIVE THEM

OUR VALUES HOW WE LIVE THEM

Integrity

• Treat our employees with care, concern and respect• High standard of corporate governance• Implement our Code of Conduct• Promote and maintain respect for human rights• Environmental responsibility• Anti-corruption

Technical excellence

• Optimal engineering solutions • Stringent quality control - ISO 9001:2008 accreditation

Delivery• Customer-centric culture• Timeous delivery• Within budget• According to customers’ specifications

Making a difference

• Original solutions• Improve customers’ productivity, safety and security• ROI for shareholders• Ensure that transformation is a business imperative• Provide our employees with varied and stimulating work environment


201610

• Ansys established as a defence company (providing

avionic computers/crash recorders to SAAF)

REVENUE: ± R700 000

EMPLOYEES: 4

ISO 9001: 2008 accreditation

Listed on AltX

REVENUE: R78,6 million

EMPLOYEES: 32

Restructuring commenced

• Restructured and focused on IP• Turnaround strategy started• Black-owned and controlled

Entered rail

Achieved B-BBEE status

Entered mining

Entered telecoms through acquisition of Tedaka Technologies

• Drive towards own IP products and services

• Acquired Parsec Holdings• Achieved Level 2 B-BBEE status

• Group fully integrated• Ansys Rail division created

• Tedaka Technologies merged with Redline Telecommunications SA

to form Tedaka Network Solutions• Maintained Level 2 B-BBEE status

REVENUE: R474 million

EMPLOYEES: 235

OUR HISTORY


201611

DEAR STAKEHOLDERS

I am pleased to present the results for the period ended 31 March 2016 that highlight our strong performance, despite depressed trading conditions in some of our market segments particularly in the local market.

Our strong performance demonstrates that Parsec Holdings was an acquisition well in line with our strategy for the business. The complete integration of all our business units is yielding the desired results and advancing our goal of being an IP-led technology company. The fruits of our acquisitions and the mergers are apparent both in client and income diversification, as well as the unlocking of our engineering capabilities.

We remain proud of the fact that we continue to innovate

in-house and our manufacturing is predominately local

and therefore contributing to South Africa’s goal to be at the

forefront of technology and industrial space. Our technology-

driven solutions are well positioned to be of high demand from

both the local and global markets.

TRADING ENVIRONMENTThe strained macro-economic environment in South Africa

remained challenging and has put pressure on our major

customers to reduce costs, which has had a negative impact

on our margins, primarily in the group’s telecommunications

and rail businesses. The reduced commodity demand has had

a negative impact on our railways clients, which resulted in

margin pressure and project delivery delays. Despite this, our

teams remained committed, showed resilience and succeeded

in increasing the top line under these tough trading conditions.

Our strong relationships with our clients was a key factorand

enabled us to weather the storm.

Similarly, due to low demand in commodities, the mining

sector remains depressed. However, our mining business grew

tremendously owing to the Parsec Holdings acquisition. Setting

aside the acquisitive growth, our mining business remained

stable, predominately owing to the nature of our products and

solutions, which enhance the health, safety and productivity,

and are generally required for mines to operate, albeit at lower

production levels. In addition, the increase in our international

sales boosted our profits and augmented local sales.

Increased competition in the telecommunications market

amongst network operators plus an increase in suppliers has

comparable impact on our business. Notwithstanding this, our

teams managed to grow the top line by 41%, again showing

the resilience of our teams. This top line growth however

did not translate correspondingly to profits, mainly due to

CHAIRMAN’S REPORT

Our growth bears testimony to the effectiveness of our strategy and commendable execution by the management team and staff.


201612

The board conducts an evaluation to identify strengths and

weaknesses within the board. This then directs the strategy of

identifying and recruiting new directors to the board, who bring

the necessary skill and diversity of thought, which enhances

our growth. The board is proud to have recruited additional

well-respected black female directors, who have contributed

tremendously towards our intent to remain a leading black-

controlled business. We are proud to be one of the few AltX

companies comprising a majority of female directors on its

board. This is ahead of the JSE guidance note.

DIRECTORSHIP CHANGESDuring the period under review, four additional directors

were appointed. Below is an outline of the changes in our

directorship:

1. Following the resignation of our previous Group Chief

Financial Officer, Rachelle Grobbelaar in December 2015,

Burt Lamprecht, the Chief Financial Officer of Parsec

Holdings, took over the role of Group Chief Financial Officer

and was officially appointed to the board on 1 April 2016.

2. Dr Snowy Khoza was appointed as non-executive director

on 21 October 2015. Her extensive experience in social and

ethics matters together with her executive leadership will

strengthen the board, particularly the Social and Ethics

Committee, of which she is now the chairman.

3. Ndumi Medupe joined the board on 9 September 2015 as a

non-executive director and now chairs the Audit and Risk

Committee. A chartered accountant and registered auditor by

profession, Ndumi brings to the board valuable experience

that will strengthen the Audit and Risk Committee. I would

like to thank Siza Mzimela, who chaired this committee for

the past two years. Her contribution is highly valued.

Siza remains a non-executive director of the board and

now serves as a member on both the Audit and Risk and the

Human Capital and Remuneration Committees.

4. Coen Bester, formerly the chairman of Parsec Holdings,

joined the board on 1 June 2015. Coen brings a wealth of

experience and continuity from his long association with

Parsec Holdings. Coen takes over the chairmanship of the

Human Capital and Remuneration Committee from

Fezile Dantile. Coen’s experience in human capital and

remuneration issues will augment the board tremendously.

5. Fezile Dantile resigned as a non-executive director on

9 September 2015 having served on the board for two years.

I would like to thank Fezile for the valuable contribution he

made to the board, especially his railways sector expertise.

CHAIRMAN’S REPORT

foreign exchange translation losses experienced in the last

quarter of the year. This risk has been reduced through the

implementation of a more robust hedging strategy, the benefit

of which will be realised in the next financial year.

The local defence market continues to grow although at a

slower rate. The international defence markets on the other

hand present more opportunities for growth. During the period

under review, our revenue grew by 802,1%, part of which

was a result of the amalgamation of the Parsec and Ansys

defence and information security businesses and growth in

international sales. The group’s strategic advantage remains in

the diversity of the segments in which it operates.

PERFORMANCEThe group delivered HEPS growth of 9,5% and PAT growth of

99,2%. This growth bears testimony to the effectiveness of our

strategy and commendable execution by the management team

and staff. Indeed, there is room for improving margins, however

by and large, the board is confident that the group’s strategy

will support the long-term growth and sustainability

of the company.

For further details on the group’s performance, please refer to

the Group CFO’s report on page 42.

SUSTAINABILITYAnsys remains committed to acting responsibly to achieve

sustainable economic, environmental and social progress.

During the reporting period, designs and developments

undertaken ensured that we reduce the impact on the

environment. The Social and Ethics Committee report on page

60 and the impact of our occupational health and safety report

(Our people) on page 69 covers our work in this space.

GOVERNANCE

Ansys is committed to a high standard of corporate governance and to this end the group continuously looks for ways of improving its performance.

In line with the board’s fiduciary and statutory obligations to

provide strategic direction, we have restructured and separated

into two, our previous Social, Ethics and Human Resource

Committee. They are now separated into the Social and

Ethics Committee and the Human Capital and Remuneration

Committee. This provides improved focus on social and ethics,

human capital and remuneration as well as governance matters

in the group.


201613

I believe that he will continue to drive the group’s growth to

unprecedented levels.

I would also like to thank our clients, suppliers, business

partners and all our stakeholders for their support and for

the confidence they have shown in us. To our investor

community, thank you for trusting us to lead this great

organisation. In 2017 we look forward to celebrating 30 years

of Ansys’ existence as we continue to build a world class, IP-led

technology business.

As this is my last chairman’s report, I would like to extend my

gratitude for the commitment from all those involved that

has allowed us to turn Ansys’ fortunes around. I step aside

with pride, leaving the company on the right track and having

achieved the objectives we had communicated to the market.

I am confident that the company is on a firm growth trajectory.

NONHLANHLA MJOLI-MNCUBECHAIRMAN13 September 2016

6. Rynier van der Watt, the former CEO of Parsec Holdings,

joined the board as an executive director following the

Parsec Holdings acquisition on 1 June 2015. He brings a

wealth of executive and engineering experience that will

strengthen the board.

7. Finally, at the end of the financial period, Teddy Daka

announced his decision to step aside as Group CEO after

four years at the helm. Teddy will, with effect from

1 October 2016, assume the role of executive chairman,

a position he held previously although in a non-executive

capacity. Rynier van der Watt has been appointed the new

Group CEO, taking over when Teddy steps aside. With these

changes, I will also be stepping aside as non-executive

chairman on 1 October 2016 and will assume the role of

lead independent non-executive director.

OUTLOOKThe general economic outlook for South Africa is expected to

decline, with GDP now expected to be at 0% for 2017. We expect

tougher trading conditions in the local market but we remain

bullish in our export markets. Overall, we are confident that we

have the right strategy and depth of talent on both our board

and management teams that will assist us to weather these

challenges. We will continue to focus on growing the top line,

make the business more efficient and invest in innovation and

our people.

APPRECIATIONOn behalf of the board, I would like express my sincere

appreciation to my fellow board members, the management

and staff for their dedication to produce these results and

steer Ansys during this period. Under the stewardship of

Teddy Daka, Ansys has undergone significant and

transformative changes that will continue to benefit the

company well into the future, I wish to thank Teddy for his

foresight, wisdom, commitment and leadership

which he has given to Ansys over the years.

Rynier van der Watt, Ansys’ future Group CEO, is an

experienced engineer and entrepreneur. His track record as

CEO of Parsec Holdings was formidable and he demonstrated

the ability to lead a technology and engineering company.

CHAIRMAN’S REPORT CONTINUED


201614

THE YEAR AT A GLANCE

2016was another successful

period for Ansys and

has seen significant

growth for the group

in terms of revenue, profits and cash. We have increased

our profitability, improved our competitiveness and created

value for our shareholders. Despite challenging trading

conditions owing to a strained South African macro-economic

environment, our people managed to deliver strong financial

performance, continued to successfully implement our

strategy and laid a strong foundation for our future.

During the period we continued to strengthen our vertical

markets, bolstering our delivery capability and consolidating

the group. The acquisition of Parsec Holdings, which follows

that of Tedaka Technologies in 2013, has enabled us to realign

and extend our offerings in the sectors in which we operate,

as well as increase our market penetration. Our strategy

of diversifying sectors has not only resulted in minimised

exposure to concentration risk, but has also helped us to

achieve continuity in both operations and profit-generating

capability.

As part of this process, we achieved numerous milestones

that define a new future for Ansys. This included the

enhancement of both our intellectual property and technology

delivery capabilities, and the realignment of our product and

service offerings to meet the changing needs of our clients in

the sectors we serve.

Our financial results demonstrate that we are rapidly becoming

the IP-led engineering and technology company we envision.

Revenue is up by 88,8% from R251 million to R474 million.

Earnings before tax (“EBITDA”) also increased by 119,6% from

R19,5 million to R42,8 million, and headline earnings per share

(“HEPS”) improved by 9,5% from 4,44 cents to 4,86 cents.

Considering that in 2014 we reported a loss of R7 million, this

achievement is particularly noteworthy.

SECTOR ANALYSISRevenue in the defence and information security sector grew by

802,1% from R9,9 million to R90,1 million, while profit increased

by 923,9% from R1,6 million to R15,997 million. This growth was

mainly due to the acquisition of the Parsec defence businesses,

which enabled the group to rationalise costs, exploit synergies

and extend market reach. In general, the sector has also

benefited from exports and the ongoing need for high level

information security.

Our financial results demonstrate that we are rapidly becoming the IP-led engineering and technology company we envision.

GROUP CEO’S REPORT


201615

GROUP CEO’S REPORT CONTINUED

Performance in the telecommunications sector also showed

a notable improvement, with revenue growing by 41% from

R144,9 million to R204,3 million. Growth was boosted by the

acquisition of Parsec Holdings telecoms business, but profit

was subdued, dropping from R7,1 million to R6,1 million, mainly

as a result of unforeseen forex losses in the period December

2015 to February 2016.

As growth in demand for data continues to increase, Ansys nevertheless anticipates robust growth in this sector in the future, especially as the group’s value chain has been realigned to focus on solutions rather than components.

In a similar vein, revenue in the rail sector grew by 45,6%

from R94,1 to R137 million. Profit, however, declined from

R17,1 million in 2015 to R15,9 million in 2016, mainly due to lower

margins, delayed roll-outs and forex losses in the final quarter.

Finally, while the mining and industrial sector has remained

flat, the group’s performance has improved there as well, with

revenue up by 1 914,6% from R2,1 million to R42,5 million.

A review of our business segments can be found on pages 22

to 25.

STRATEGY The group’s strategy has been to strengthen its presence in the

four vertical markets in which it operates, reduce concentration

risks and enhance delivery capacity. Our newly integrated

structure presents an excellent platform for growth, both in the

current financial year and beyond.

We therefore remain focused on our objective of becoming an

IP-led engineering and technology company. As a corollary

to this, we continue to focus on becoming a leading OEM

(original equipment manufacturer) through innovation, both

in-house and in association with various partners. We made

significant progress in building a scalable business model with

standardised and accelerated business processes and also

improved internal networking and collaboration efforts across

all our businesses.

We also intend to continue to grow, both organically and

through the acquisition of companies aligned to our core

business. We are deeply committed to ensuring that our locally

developed and manufactured products meet world class

standards and are of the quality required for global distribution.

Lastly, we intend to increase our exports as we continue to

produce world class products and expanding into regional and

international markets.

OUTLOOKAnsys has ended the year on a solid footing with strong

platforms for growth in place. Our business model has

demonstrated its flexibility and scalability, and is well aligned to

the needs of clients in the sectors in which we operate. We aim

to continuously simplify our organisation in order to improve

our operational excellence, increase our efficiency and create

competitve advantage.

This does not mean that it will all be plain sailing from here,

as developments in the South African macro-economic

environment testify. The group expects the South African

economy to weaken further during the 2017 financial year,

resulting in downward pressure on its markets in both the short

and medium term. This, in turn, is expected to impact to varying

degrees on margins across all operating sectors.

Despite these challenging conditions, we expect to continue

improving our performance in the 2017 financial year.

With the successful integration of the Tedaka and Parsec

Holdings businesses into the Ansys group, our four vertical

markets have been strengthened in terms of both market

access and delivery capability.

Equally, I am optimistic that our strategy, together with a strong

management team, competitive solutions, and our brand will

see us through these challenging times.


201616

APPRECIATIONIn conclusion, I would like to take this opportunity to thank

the many people who are responsible for the success of our

turnaround strategy, our new positioning and our solid financial

results. Succession planning remains one of our business

imperatives and after four years as the Group CEO of Ansys,

as of 1 October 2016, Rynier van der Watt will be taking over

from me as I move into the role of executive chairman of the

group. I remain grateful for my time as Group CEO of Ansys

and convinced that the group is well positioned to continue to

prosper and grow under the leadership of Rynier.

To my colleagues on the board, thanks are due for your support

hard work, insight and courage. Thanks are also due to our staff,

whose commitment to our new path has been unwavering, as

well as to our business partners, suppliers and advisors, who

have helped us to set a bold new course.

Above all, I would like to thank the people without whom

Ansys would not exist, our partners, customers and our

shareholders. Your commitment to our business throughout

the challenges of the past three years is sincerely appreciated.

We remain committed to delivering the very best engineering

and technology solutions for our clients, to the benefit of

all stakeholders.

TEDDY DAKAGROUP CHIEF EXECUTIVE OFFICER 13 September 2016


201617

HOW WE ADD VALUE

Dedicated to providing the highest quality and cost effective health monitoring and communications rolling stock solutions

We produce, develop, distribute and integrate technology-driven engineering solutions for harsh environments to improve our clients’ productivity and safety.


201620

The value added statement depicts the performance and efforts of management, employees and providers of capital. The statement further indicates the value added distribution to those contributing throughout the year.

31 March 31 March 28 February 28 February2016 2016 2015 2015

R’000 % R’000 %

Revenue 474 066 251 121 Cost of material and services* (329 585) (185 039)

Value added by operations 144 481 98,55 66 082 99,41Interest income 1 419 0,97 34 0,05Other income 703 0,48 361 0,54

Total wealth created 146 603 66 477

Applied as follows:Employees’ salaries, wages and benefits 102 346 69,81 46 938 70,61Government taxation 8 529 5,82 4 302 6,47Providers of capital and interest 4 996 3,41 1 842 2,77Dividends – 0,00 – 0,00

Retained in the groupRetained profit 19 974 13,62 10 025 15,08Depreciation and amortisation 10 758 7,34 2 201 3,31Impairment of development cost – 0,00 1 168 1,76

146 603 66 477

ReconciliationCost of sales 351 054 187 916 Add back:– Labour overhead recovery 60 235 18 703

290 819 169 213

Overheads 91 636 46 262 Add back:– Employees’ salaries, wages and benefits 42 111 28 235 – Depreciation and amortisation 10 758 2 201

38 766 15 826

329 585 185 039

VALUE ADDED STATEMENTas at 31 March 2016

Employees

46 938

102 346

Government

8 529 4 302

Providers of capital and interest

4 996 1 842

Retained in the group

30 732

13 394


201621

BUSINESS SEGMENT REVIEW

DEFENCE AND INFORMATION SECURITYParsec Proprietary Limited

VALUE PROPOSITION We are an ODM that develops, produces and integrates bespoke electronic subsystems and products for clients in the defence, aerospace and information security sectors. Our products and services are strategically aligned to the long-term needs of clients in these industry sectors.

CORE OFFERING OPERATIONAL REVIEW

We offer comprehensive integrated solutions and services that incorporate unique skills and capabilities that appeal to a broader section of the market and cover: • Information security – Secure Security Network

Solutions – User security in the

from of USB based authentication, encryption and digital signing solutions

• Embedded solutions and mission computers

• Weapon integration and weapon control systems

• System design and integration

• Bespoke electronic hardware and software development

• Test equipment • Electronic Contract

Manufacturing Service

Following the acquisition of Parsec Holdings, the Ansys and Parsec defence businesses were integrated to create a much stronger business unit with the capability to offer comprehensive integrated solutions ranging from components to high end subsystems. This capability has enabled the company to appeal to a much broader section of the defence and information security industry, resulting in the substantial increase in revenue reported for this period. Our defence and information security business now trades under the Parsec brand.

Our revenue was boosted by both local and international demands. In the local market, revenue more than doubled owing to a wider offering and increase in local demand. Revenue from exports increased and was driven by the demand in the Middle East and modest foreign exchange translation gains. Increase in profits and profitability were driven by growth in revenue and optimisation of the manufacturing facility, which allowed us to contain costs despite the increase in revenue.

We invested in a new high-tech facility with increased capacity to address the growing market demand and to remain abreast of technological changes in the sector.

REVENUE grew by

802,1% to R90,1 million

PROFIT increased by

923,9% to

R15,997 million

OUTLOOK

The global defence industry is experiencing growth which also resulted in spinoffs for the local market. In the short to medium term we see increased growth in the local defence market owing to the substantial order books of our major clients, who rely on companies such as ours to meet their delivery commitments. In the medium to long term, we believe that spending on revitalising the local defence capability, as projected in the Defence Review, may begin to flow in and boost the local defence market. In the international defence market, we envisage increased growth particularly in the Middle East where the current spending cycle will continue into the foreseeable future. We anticipate that the demand for information security products will increase, as cyber security is increasingly becoming an issue in the local and international markets.

New high-tech MANUFACTURING facility


201622

MINING AND INDUSTRIALParsec Proprietary Limited

VALUE PROPOSITION We are an ODM that specialises in the design, development, manufacturing, integration and support of advanced technology systems and products in the mining and industrial sector: which are aimed at improving the health and safety environment and competitiveness of our clients.


• Mobile Rope Testing

Solutions

• Bespoke electronic hardware

and software development,

including:

– Gas detection instruments

– Collision awareness

systems

– Management software

• Electronic Contract

Manufacturing Services,

including:

– Development of related

test equipment

– Product industrialisation

Our revenue and profit growth was

primarily as a result of the amalgamation

of the Ansys and the Parsec mining

businesses, which now operate under the

Parsec brand. Despite the tough trading

conditions experienced in the local mining

market, linked to the global slump in

commodity prices, our revenue remained

stable largely as a result of our product

and services being aligned to the regulated

health and safety equipment for the sector.

The amalgamation has positioned the

business as a leading ODM providing us

with a comprehensive platform to deliver

safety solutions to our clients in this field,

with more agility. The synergies obtained

from shared services, engineering, and

upgrades to the shared manufacturing

facility have boosted the profitability of

the business unit.

OUTLOOK

Mine safety remains a top priority for our clients and the stricter changes

in safety legislation are expected to increase demand for the mine safety

products we develop and manufacture. We anticipate that the drive to reduce

costs to make local mining operations more competitive will increase demand

for mechanisation, which in turn creates new opportunities for our service

offering. The local mining sector is showing signs of recovery, which we

believe will boost revenue in the short to medium term. Although we adopt a

conservative outlook for the sector we remain optimistic about our prospects,

given the nature of the solutions we offer.

REVENUE grew by

1 914% to R42,5 million

PROFIT for the period

increased to R4,029 million

Ansys and Parsec Mining and Industrial CAPABILITIES fully INTEGRATED


201623

BUSINESS SEGMENT REVIEW CONTINUED

ANSYS RAIL(a division of Ansys Limited)

VALUE PROPOSITION We develop, produce and integrate world class technology-driven health monitoring and train communication rail solutions that improve the productivity and safety of our clients.


We provide train communication and health monitoring solutions in the railways industry. Consisting of:Trackside Systems• Vehicle identification• Hot bearing detection• Load profile monitoring• Integrated train condition

monitoring system• RF ID tags• Smart pass readers• Vandal proof solar power

solution

Onboard Systems• Integrated displays• Auxiliary displays Train communication• Train definition unit• Asset tracking

Our revenue increased by 45,6% owing to the railway network and fleet modernisation programmes of our major clients. Demand for our trackside measurement systems was higher than anticipated and the demand for onboard systems was much lower. This decline resulted in lower profits being reported, compared to last year’s (predominately due to the margins for our trackside measurement being lower compared to those of our onboard systems). This was also coupled with the project delays we experienced from our major client and modest foreign exchange translation losses which negatively affected our margins.

During the period under review, the rail business was restructured into a stand-alone division to better service our clients. Non-rail projects and products were moved to our Parsec subsidiary. The remaining rail operation now has its own dedicated executive team led by a chief executive.

Further investments aimed at improving the quality and customer experience were implemented; with the project delivery capacity being capacitated with additional quality engineering skills and non-core civil works being outsourced.

OUTLOOK

Although we are conservative in our outlook for commodity demand that predominantly drives the railways sector, we anticipate that the modernisation programmes of the railway networks and fleets will continue to provide opportunities for growth in the short to medium term. While the infrastructure modernisation of the railway networks is at an infancy stage, we are optimistic that our current product offering places the division in good stead to meet the demands of the rail operators. We envisage that the demand for system health monitoring and big data and analytics will drive demand for our services and products in the medium to long term.

REVENUE grew by

45,6% to R137 million


R15,9 million

RESTRUCTURED BUSINESS New rail division focused on

railways clients


201624

TELECOMSTedaka Network Solutions Proprietary Limited

VALUE PROPOSITION We design, install, commission, distribute and integrate high quality telecommunications products and solutions that enhance the network integrity of our clients.

CORE OFFERING

• Distribution of fibre and data cabling infrastructure

• Radio frequency products

• Wireless network design, implementation and operation

• Data centre design and implementation

• Structured cabling and fibre reticulation

• Network and equipment monitoring solutions

• Installation, maintenance and support services

OPERATIONAL REVIEW

Revenue was boosted by increased demand for our fibre network products.

During the period under review, network operators continued to invest in

upgrading their network infrastructure to meet the growing demand for

broadband. Profits were however subdued primarily due to foreign exchange

translation losses experienced in the last quarter of the year.

In line with our strategy of becoming a turnkey network solutions provider

and to meet the growing demand for telecommunications solutions, we

invested and expanded the delivery capacity of our design and installation

teams by integrating Redline Telecommunications SA into Tedaka. We also

optimised our distribution operation to reduce costs. This included revamping

our warehousing, logistics and management systems.

OUTLOOK

In the short to medium term, we expect

growth in the sector, as the increasing

demand for bandwidth has required the

network providers to invest further in

upgrading their network infrastructure.

We anticipate that competition amongst the

network operators will continue to intensify

and therefore foresee margins coming

under pressure. However, the optimisation

programme implemented in the period

under review, will assist in overcoming this

challenge and we therefore expect improved

performance on our bottom line.

NOTABLE INCREASE IN REVENUE,

up by 41% to R204,3 million


R6,1 million

AUGMENTED PRODUCT OFFERING to

focus on services: full turn-key connectivity solutions.• Redline Telecommunications SA fully integrated

into Tedaka• Name change from Tedaka Technologies

to Tedaka Network Solutions to reflect new capabilities

• Invested in a new assembling unit


201625

OUR BUSINESS MODEL AND STRATEGY

• Design• Hardware development• Software development• System engineering• Technical skills and

experience• Production and assembly• Start-to-finish

solutions• Programme and

project management• IP building blocks• Strategic

partnerships• Long-term funding

WH

AT G

OES

IN

• Origination• Production• Development• Distribution• Start-to-finish

solutions• Integration of

technology-driven engineering solutions for harsh environments to improve client productivity, security and safety

WH

AT W

E D

O• Bespoke and

standard solutions• Original Design

and Equipment Manufacturing

• Information security solutions

• Embedded solutions• Tracking

measurement and onboard train cab control and communication systems

• System integration• Mine safety products

and solutions • Carrier and

enterprise telecoms solutions

WH

AT W

E

PRO

DU

CE

• Sustained financial growth

• Improved safety, competitiveness and efficiency for clients

• Technology partner• Upskilled workforce• Intellectual growth• Industry and

technological advancement

OU

R IM

PACT

SLONG-TERM STRATEGIC OBJECTIVES 2016 PROGRESS

Enhance group IP • Completed the acquisition of Parsec Holdings• Focus on originating technology-driven engineering solutions• Emphasis on determining clients’ needs• Leveraging on in-house technical, hardware, software and embedded software

and systems engineering skills• Identified future IP based acquisitions

Enhance research and development and innovation capability

• Enabled culture of innovation in which original thinking and an entrepreneurial approach are encouraged and rewarded

• Invested in innovation and product development

Diversify segmental and revenue risk • Acquired Parsec Holdings and diversified into the information security sector • Acquired Parsec Holdings and increased the size of our business in the mining and

defence sectors• Doubled the revenue and client base• Balanced the revenue and profits in all our sectors

Position the group as a customer-centric solutions provider

• Entrenched a company-wide culture of quality• Maintained ISO 9001:2008 accreditations in the group• New operational executives appointed to execute quality controls• Continued client status meetings and surveys• A proactive approach towards effective client relationship management

Achieve and maintain Level 1 B-BBEE status

• Increased drive towards supporting and contributing to enterprise development• Invested in employee skills training and leadership development• Maintained Level 2 B-BBEE status

Attract, develop and retain skills • Created varied and challenging work environment with appropriate incentives and rewards

• Learnership programmes implemented in various divisions• Succession planning programmes in place

OUR STRATEGY

OUR BUSINESS MODEL


201626

At Ansys we define material issues as those risks and opportunities that have a direct impact on the ability of the group to create

value in the short, medium and long term.

MATERIAL ISSUE KEY RISKS FLAGGED ADDRESSED BY STRATEGIC OBJECTIVE

ECO

NO

MIC

Growth Delivery of

sustainable value

to stakeholders

• Not staying abreast of new

technological advances,

competitors and/or market

developments

• Tough economic conditions

• Enhance R&D and innovation

capability

• Enhance group IP

• Diversify segmental and

revenue risk

• Continue to invest in “new things”

Liquidity Ensuring sufficient

liquidity and capital

to meet business

objectives

• Debtor recovery or late payments

• Exchange rate volatility

• Demand on working capital

for growth

• Diversify segmental and

revenue risk

• Strong cash position

• Focused investments

Project execution Efficient risk-

controlled delivery

of quality products

and services

• Material and equipment theft

and vandalism

• Contract (project) execution

• Avoid supplier reliance

• Manage customer dependencies

• Technical: design aspects,

execution, change in

specifications

• Position as customer-centric

solutions provider

• Entrench quality management

company-wide

• Enhance contract and business

acumen of managers

• Anti-corruption clauses embedded

into contracts

SOC

IAL

People Attracting, developing

and retaining

employees

• Succession planning

• Uniform policies and procedures

• Attract, develop and retain skills

• Leadership development

• Achieve and maintain Level 1

B-BBEE status

Safety Adherence to

legislative

requirement

• Occupational health and safety

officers to be located at all

business facilities

• Entrench occupational health and

safety awareness company-wide

ENV

IRO

NM

ENTA

L Impact of operations (environmental)

Across-the-board

commitment to

environmental

sustainability

• Adherence to legislative

requirement

• Responsible recycling of

materials

• Entrenched quality management

company-wide

• Nurture our culture of being ethical

in all aspects

• Low carbon footprint

MATERIAL ISSUES


201627

OUR STAKEHOLDERS

As a responsible corporate citizen inclusive stakeholder engagement is key to our corporate accountability. The stakeholder groups

listed below may have an impact on or may be impacted by our business strategy.

STAKEHOLDER GROUP

WHAT MATTERS TO THEM

NATURE OF ENGAGEMENT RESPONSIBILITY ACTIVITIES IN FY2016

Shareholders/

investors

• Sustainability

• Profitability

• ROI (share price and

dividends)

• Cash generation

• Corporate governance

and compliance

• Risk management

• Growth prospects

• Reputation

• SENS

• Website

• Results presentations

• One-on-one meetings

• Road shows

• Annual general

meeting

• Site visits

• Investor polls

• JSE showcases

• Group CEO • Strengthened corporate

governance structure

• Continuous review of

performance to ensure

operational excellence

• Ensured distributions are

not at expense of business

growth

• Ensured risk management

processes are in place

Lenders/

providers of

capital

• Capital management

• Sustainability

• Profitability

• Cash generation

• Corporate governance

and compliance

• Risk management

• Growth prospects

• Contractually required

information flow

• Regular ad hoc

meetings

• Group CEO

and

Group CFO

• Strengthened corporate

governance structure

• Ensured risk management

processes are in place

Employees • Job security

• Sustainability

• Diverse and

stimulating work

environment

• Personal growth and

development

• Feedback on

performance

• No discrimination in

workplace

• Skills development

• Competitive

remuneration

• Employment

agreement

• Annual performance

management process

• HR processes

• Regular internal

information sessions

• Group HR

and subsidiary

MDs

• Standardised employment

agreements implemented

• Key performance

evaluations performed

• Consulted market surveys

to achieve market parity for

remuneration

• Promoted training and

career development

• Group culture promoted

cohesiveness

• Employee satisfaction

surveys completed

National

government

• Environmental

compliance

• Fair competitive

practices

• Skills development

• Job creation

• Revenue through

corporate taxation

• Formal and informal

meetings

• Consultations and

workshops

• Tender submissions

• Presentations

• Customer audits

• Group CEO • Submitted equity and

skills reports

• Continuous engagement

with key stakeholders in

government

• Invested in and support for

communities

• Skills development and

learnership programmes

in place


201628

STAKEHOLDER GROUP

WHAT MATTERS TO THEM

NATURE OF ENGAGEMENT RESPONSIBILITY ACTIVITIES IN FY2016

Customers • High level of

project execution

and delivery

• Quality

• Service that meets or

exceeds expectation

• Contract and service

agreements

• Regular one-on-one

meetings

• Subsidiary

MDs and

Group CEO

• Clear articulation of

expectations through

contractual agreements

• Customer feedback surveys

• Regular status meetings

• Bolstered our capacity and

optimised our capabilities

within the group

• A proactive approach

towards effective client

relationship management

Suppliers • Market conditions

• Strategic alliances/

partnership with the

business(es)

• Contract and service

agreements

• Regular one-on-one

meetings

• Presentations

• Training

• Workshops

• Group CFO

and subsidiary

MDs

• Professional relationships to

ensure impartiality and no

corruption

• Clear articulation of

expectations through

contractual agreements

and project meetings

• Regular feedback and

inspection by our

quality teams

• Feedback surveys

• Supplier accreditation and

evaluation process in place

Growth

Liquidity People

Project execution Safety

Environment


201629

LEADERSHIP

We maintain a high standard of ethical and

environmental business practices across our businesses with

integrity.This demands of

us to go beyond what is

legally correct and

doing what is morally right

BOARD OF DIRECTORS

NONHLANHLA MJOLI-MNCUBECHAIRMAN

NDUMI MEDUPE CHAIRMAN OF

AUDIT AND RISK COMMITTEE

DR SNOWY KHOZA CHAIRMAN OF

SOCIAL AND ETHICS COMMITTEE

COENRAAD BESTERCHAIRMAN OF

HUMAN CAPITAL AND REMUNERATION

COMMITTEE


201632

TEDDY DAKA*GROUP CHIEF

EXECUTIVE OFFICER

BURT LAMPRECHT*GROUP CHIEF

FINANCIAL OFFICER

SIZA MZIMELANON-EXECUTIVE

DIRECTOR

RYNIER VAN DER WATT*CHIEF: STRATEGY,

MERGERS AND ACQUISITIONS

* Executive directors


201633

EXECUTIVE COMMITTEE

TEDDY DAKAGROUP CHIEF

EXECUTIVE OFFICER

BURT LAMPRECHTGROUP CHIEF

FINANCIAL OFFICER

ELENA BIELICHGROUP HR


201634

LEBO MASEKELACHIEF EXECUTIVE:

ANSYS RAIL

PETRUS PELSERMANAGING DIRECTOR:

PARSEC

DIRK FOURIECHIEF OPERATIONAL

EXECUTIVE: TEDAKA NETWORK

SOLUTIONS

RYNIER VAN DER WATTCHIEF: STRATEGY,

MERGERS AND ACQUISITIONS


201635

BOARD OF DIRECTORS

NONHLANHLA SYLVIA MJOLI-MNCUBE (57)

Independant non-executive director

Chairman

Appointed 4 June 2013

BA; MSc; Spurs Fellowship USA; Certificate in Engineering and Technology Management

Nonhlanhla is a businesswoman and former Economic Advisor to the Presidency. She has worked as a City and regional planner in

South Africa, a survey research supervisor at Washington State University, USA, an executive director at a subsidiary of Murray &

Roberts, chairman of several housing funds, is a managing owner and founder of women entrepreneurial organisations. She has

certificates in Leadership (Harvard and Wharton Universities USA) and Technology Management (Warwick University, UK). She is

entrepreneurial, a strategic thinker with proven leadership ability and passionate about sustainability and economic development. She

has more than 10 years’ experience as a board member in various JSE listed companies.

NONDUMISO MEDUPE (45)

Non-executive director

Chairman: Audit and Risk Committee

Appointed 9 September 2015

CA(SA); Registered Auditor

Ndumi is the founding director of Indyebo Incorporated. Armed with over 20 years’ experience in internal auditing, risk management

and financial management, she held financial management and business analyst positions at Vodacom and MTN respectively.

A former Director: Financial Planning and Budgeting at the Gauteng Department of Finance, she was responsible for a R16 billion

budget. Ndumi later joined Johannesburg City Parks as General Manager: Finance.

She also serves as non-executive director for Pinnacle Holdings, Foskor, City Lodge and is a member of Italtile’s Audit and Risk

Committee, which she chairs. Her previous board experience includes serving as a non-executive director at Umgeni Water Board,

PetroSA and Armscor.

DR SNOWY JOYCE KHOZA (58)


Chairman: Social and Ethics Committee

Appointed 21 October 2015

BA (Social Work); BA Honours (Social Work); MA (Social Science); PhD (Social Policy); MBA. Executive Programmes: Global Programme for

Management Development; Utility Regulation and Strategy; Finance for Executives, INSEAD

Dr Khoza is a seasoned executive and acknowledged strategist with remarkable business acumen honed from 30 years of senior

management and directorship experience in the public and private sectors. As the current Group CEO of Bigen Africa, Women4Africa,

a London-based organisation, recently recognised her as one of the top African women leaders in her sector. Her recognition awards

in 2015 include being recognised by the Council for Engineers South Africa’s Young Professionals Forum as one of the ten women

for “Special achievements and sterling contributions to, as well as for uplifting the role of women in, the construction industry and

consulting engineering profession” and by CEO Global as one of the three South African women Ambassadors for Most Influential

Women in Africa. Also in 2015, she was awarded the Top Performing Business Leader Award in South Africa at the 13th South African

Business Awards. In 2014, Dr Khoza was recognised as one of the six South African women to receive the Africa Lifetime Achievers

Awards of Africa’s Most Influential Women in Business and Government in the infrastructure sector.

Dr Khoza is an influential and inspirational leader and well-recognised and sought-after public and motivational speaker. She has

given keynote addresses at international (e.g. FIDIC in Barcelona), continental (e.g. WIPO in Senegal) and national (several Business

Women’s Forums) conferences on topics mainly in the infrastructure development and development financing space.

DIRECTORATE


201636

COENRAAD PETRUS BESTER (60)


Chairman: Human Capital and Remuneration Committee


BSc Electronic Engineering; BSc Electronic Engineering (Hons); MBA; OPM

Coen is a seasoned businessman and serial entrepreneur, having successfully run his own high-tech venture, which he later sold.

He has studied and taught leadership to various corporate clients for over 15 years. He serves on the boards of a number of

engineering companies. The author of Live & Lead: Discover Your Personal and Organisational Guidance System (2012).

Coen is the CEO and owner of BrainWorks, a management consulting company.

SIZAKELE PETUNIA MZIMELA (51)



BA (Economics and Statistics); Certificate in Management; Transnet Executive Development Programme

Siza Mzimela currently serves as the CEO and founder of Fly Blue Crane as well as the executive chairperson of Blue Crane Aviation.

Siza served as the Chief Executive Officer of both South African Airways and SA Express Airways. She has held various pioneering roles

within the aviation industry, including being the first female board member at IATA in 67 years. Siza currently chairs the board of

JSE-listed company Cargo Carriers and serves on the board of African Reinsurance Corporation, amongst others. Her past directorships

include being a non-executive director at SA Tourism.

TEDDY DAKA (51)

Executive director

Group Chief Executive Officer

Appointed 10 October 2001

BA (Hons) in Business Management; MBA; Executive Programmes

An astute entrepreneur and visionary, Teddy has extensive experience and knowledge in establishing, growing and turning around several

businesses. Teddy’s current directorships include non-executive Global Chairman of the Aurecon Group Limited (Australia), non-executive

chairman of Tedaka Investments Proprietary Limited and he is a trustee of the South African National Defence Force Education Trust.

Having served on numerous boards of both private sector and state-owned companies, Teddy’s past non-executive directorships

include South African Airways Proprietary Limited, South African Airways Technical Proprietary Limited (Chairman), T- Systems

Proprietary Limited, The Nations Trust, Africon Proprietary Limited, Aurecon Africa Ownership Trust (Trustee) and ADC-Krone

Telecommunications Africa Proprietary Limited amongst others. In addition, Teddy has served as ministerial advisor and often advises

public sector institutions and private sector companies.

BURT CHRISTIAAN LAMPRECHT (35)

Executive director

Group Chief Financial Officer

Appointed 1 April 2016

CA(SA)

Prior to serving as Parsec Holdings group financial manager, Burt completed his articles at PricewaterhouseCoopers Inc. and

thereafter gained international exposure and experience in the UK on a short-term secondment.

Since the completion of his articles, Burt has gained experience in financial management in the commercial industry, with

companies in various sectors (software development as well as the retail sector), which he has been able to utilise in his role within

the Ansys group.


201637

DIRECTORATE CONTINUED

ANDRIES RYNIER VAN DER WATT (48)

Executive director

Chief: Strategy, mergers and acquisitions


BSc Electronic Engineering; BSc Electronic Engineering (Hons); Business Administration, AltX, Directors induction.

A co-founder and executive director of Parsec Holdings, Rynier is responsible for strategy fomulation of Ansys Limited and its

subsidiaries. Additional responsibilities include spearheading growth of the group through mergers and acquisitions and integration

of the new businesses into the Ansys group of companies. He is an Aerotek Achiever Award winner and member of the Advisory

Committee of the Engineering Faculty at University of Pretoria.

SECRETARIAT

Fusion Corporate Secretarial Services Proprietary Limited represented by:

MELINDA GOUS

Company Secretary

Fusion has combined experience of more than 10 years in company secretarial practice. Combined qualifications include certificates in

advanced business and securities law and BCom (Law) degrees.

Melinda has over 14 years’ experience in company secretariat services. She has been Company Secretary to various listed

companies and their subsidiaries.

Fusion provides company secretarial services to a number of listed companies and their subsidiaries and remains independent in

its function.

GROUP EXECUTIVE COMMITTEE

TEDDY DAKA (51)

Executive director

Group Chief Executive Officer

Please see full CV on page 37.

BURT CHRISTIAAN LAMPRECHT (35)

Executive director

Group Chief Financial Officer

Please see full CV on page 37.

ELENA ANNE FRANCES BIELICH (60)

Group HR Manager

Appointed 1 November 2015

BA; Higher Education Diploma; BA; MBL

One of the first Parsec shareholders and employees, Elena’s contribution to Parsec’s development since 1998 ranges from

establishing and growing the human resources support function, driving marketing and communication initiatives in the early years

and representing Parsec on the South African Electrotechnical Export Council (SAEEC).

ANDRIES RYNIER VAN DER WATT (48)

Executive director

Chief: Strategy, mergers and acquisitions

Please see full CV above.


201638

WINSTONE LEBOKGANE MASEKELA (49)

Chief Executive: Ansys Rail (A division of Ansys Limited)

Appointed 1 November 2015

BSc Mechanical Engineering Degree; Executive Leadership Programme; Finance for non-financial managers (IoD)

Lebo started his career as a design engineer with SA Breweries. He worked as an engineer at Engen and at Denel Kentron. From 1999

until 2004 he was director of Lechabile Quality Strategies and CEO of Infotech from 2005 to 2012.

The major opportunity at Infotech was to realise the massive potential of a joint venture with FirstRand Bank (Wesbank) on vehicle

tracking/monitoring. The joint venture grew rapidly. In 2007 FirstRand decided to team up with Tracker and buy out Infotech.

In May 2007, Lebo formed Molalatladi Capital, a major investor in Infotech as well as Enermatics Energy, a smart metering company.

Lebo served on the board of Attacq Limited, a listed property fund.

While at Parsec Lebo served as executive director: new markets and strategic business development before being deployed to manage

Ansys Rail. He now serves as non-executive director on the Parsec board.

DIRK THEUNIS FOURIE (48)

Chief Operational Executive: Tedaka Network Solutions Proprietary Limited

Appointed 1 February 2016

Dirk joined Tedaka Technologies in May 2016 as acting chief operational executive. He facilitated the merger with Redline

Telecommunications SA, a subsidiary of Parsec Holdings into Tedaka Technologies, and formed Tedaka Network Solutions, a company

that is poised to offer the telecoms sector effective and holistic solutions.

Dirk has vast experience as an analyst programmer in the telecoms environment. He has an astute understanding of start-ups and

co-founded iScrip People and Technology to develop a Securities Lending System (Scrip), as well as Naledi-Santek Communications,

specialists in structured cabling. He later merged these two companies to form iScrip People and Technology.

PETRUS CORNELIS PELSER (49)

Managing Director: Parsec Proprietary Limited

Appointed 1 March 2001

BSc Electronic Engineering Degree; BSc Electronic Engineering Hons Degree

Petrus is a co-founder of Parsec in 1997 and has been managing director since 2001.

Prior to this, Petrus managed Parsec Design Solutions, the engineering design and development division. Petrus was instrumental

in establishing Parsec Components and in facilitating various business deals, including acquiring the distributorship of a number of

international electronic component companies, the flagship being the Altera agency. Petrus was responsible for the footprint that this

American Top 100 company established in South Africa. After a number of years, Parsec sold the Altera agency to EBV Electrolink.

Petrus has vast experience in Very High Speed Integrated Circuit Hardware Description Language (“VHDL”), data acquisition and digital

design and ensured that Parsec has an embedded depth of knowledge in these fields of expertise. He is renowned for introducing VHDL

into South Africa. He also compiled and presented the first VHDL training courses locally. VHDL is used to design Field-Programmable

Gate Array (FPGA) logic circuits.

Petrus built up over 18 years’ experience in the electronic design and development arena. He was responsible for various data acquisition

projects ranging from high precision to radar applications. He moved into technical marketing and negotiated and closed numerous local

and international contracts.


201639

PERFORMANCE

High performance bespoke electronic subsystems and information security solutions

Ansys has once again delivered a solid financial performance on the back of the build-up from the successful 2015 financial year. This year’s results are augmented with the inclusion of the

results from the Parsec Holdings transaction, increasing the group’s critical mass, and also diversifying our offerings to the segments that we operate in.

The results include the following highlights:

– Revenue was up by 88,8% to R474 million from R251 million

– EBITDA was up by 119,6% to R42,8 million from R19,5 million

– Profit after tax improved by 99,2% to R19,9 million from R10 million

– HEPS increased by 9,5% to 4,86 cents from 4,44 cents

As can be seen from the highlights, the group has had another

sterling year with growth across the board.

COMPARABILITY OF RESULTSThe Parsec Holdings group results are included for 10 months from the effective date of acquisition, 1 June 2015 to 31 March 2016, and hence most of the large movements from the comparative results would be due to this change.

Also, Ansys Limited changed its financial year-end from 28 February to 31 March during this past year, giving a 13-month financial year for the Ansys group, of which only 10 months of results from the Parsec Holdings have effectively been incorporated.

FINANCIAL PERFORMANCESome key features of the financial performance of the group have been mentioned elsewhere in this integrated report. As a result, I will focus on some selective financial aspects of the performance for the past financial period.

Statement of comprehensive incomeRevenue, EBITDA, net profit, operating costs and HEPSWe experienced huge growth in revenue during the past year, where we were up by 88,8% from the prior financial year. As can be seen from the segment reports on pages 22 to 25, we experienced growth across the board in all segments. Whilst some of this growth pertains purely to the combination of the Ansys and Parsec results, we did have some considerable growth in the telecoms, rail and defence segments as well, which is a very positive sign for the future of the group.

Comparing EBITDA figures to last year we can see this year’s performance increasing by 119,6%, showing that we have done significantly better with the current assets we have, than we have grown in revenue. Net profit also increased by 99,2% year-on-year.

Ansys has once again delivered a solid financial performance on the back of the build-up from the successful 2015 financial year.


201642

GROUP CFO’S REPORT

Looking at operating costs, which grew by 62% year-on-year, it is clear that we have managed to increase revenues without increasing our fixed cost in the same ratio, and we hope to further leverage off this strength in the future as well.

Headline earnings per share increased by 9,5%, which is exceptional taking into consideration that our number of issued shares increased by 88% during the year, and we hope to improve even further on this performance in the years to come.

Other (losses)/gainsThis year the group was impacted by the depreciation of the South African Rand (“ZAR”) against the major currencies of the world. Most notably, our exposure to the Euro especially hit us hard in the December 2015 to March 2016 period, where the ZAR devalued drastically and also had some very volatile periods. This volatility particularly impacted our telecoms and rail segments severely, and whilst these segments experienced good growth in revenue, this did not translate into the profits we envisaged. The estimated effect of this sudden loss in forex is R3,6 million in the telecoms segment, and R1,8 million in the rail segment as at the end of the financial period. The group now follows a more comprehensive hedging strategy to ensure we are adequately covered and able to protect our gross profit margins as far as possible.

FINANCIAL POSITIONStatement of financial positionThe total asset value of the group increased by 180% during the period, and this primarily as a result of the figures now including Parsec Holdings.

Some notable increases include:Property, plant and equipment:The biggest move is due to the addition of the Parsec office building of R30,5 million to the group’s assets.

Intangible assets:The increase in intangibles is predominately due to the Parsec Holdings transaction, with R23,6 million of intangibles identified as part of the Purchase Price Allocation, as well as R78 million of goodwill.

Inventories:At the end of the period, Parsec Holdings contributed a total of R12,8 million to the inventories. The remaining inventories show an increase in holding since the previous year due to the group ramping up towards future deliveries, as well as forecasted inventory requirements for high market demand, during the first quarter of the next financial year in the rail and telecommunications sectors.

Trade and other receivablesAt the end of the period, Parsec Holdings contributed R34,8 million of the total trade and other receivables. The remaining increase in the period-end balance is mostly due to increased

sales in the last month of the financial year, increases in the VAT receivable from the Receiver of Revenue as well as an increase in the project receivables at period-end.

Interest bearing borrowingsNotably, the biggest increase was due to the addition of the Parsec office building borrowings (R29,9 million).

Trade and other payablesAt the end of the period, Parsec Holdings contributed R47,2 million of the total trade and other payables. The remaining increase in the period-end balance is mostly due to significant increases in trade creditors due to increased purchases in the second half of the financial year as well as the abnormal devaluation of the Rand against the Euro since December 2015.

CASH FLOWThe changes in working capital had a significant impact on the cash outflow from operating activities, which decreased from the prior year. Included in the working capital change is a R28,8 million increase in inventory, which includes purchases to be ready for high market demand during the first quarter of our next financial year. Also included in the working capital change is a R30,3 million trade creditor relating to the purchase of the Parsec office building that was subsequently replaced by the bond referred to in the financials.

RESTATED FIGURES The reviewed March 2016 figures which were released on SENS on 30 June 2016 have been restated to include the finalisation of the Purchase Price Allocation of the Parsec Holdings transaction. More detail on the exact impact of this inclusion can be obtained from the audited condensed consolidated abridged financial statements for the period ended 31 March 2016, which was released on SENS with the notice of the Annual General Meeting and Integrated Annual Report.

CONCLUSIONThis has again been an extremely challenging year from an operational perspective, but also an extremely successful year from a performance point of view. I would like to congratulate all the hard working employees of the group that have stuck to their tasks, and helped us to deliver on the promise of the potential of this group, and who are also committed to the future of the group as a whole.

A heartfelt word of appreciation also goes to the board and the executive teams of all the companies and divisions within the group for their continued support and leadership – I am looking forward to the new 2017 financial year and all its challenges.

BURT LAMPRECHTCHIEF FINANCIAL OFFICER 13 September 2016


201643

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

13 months ended

12 months ended

12 months ended

12 months ended

12 months ended

31 March 28 February 28 February 28 February 29 February2016 2015 2014 2013 2012

R’000 R’000 R’000 R’000 R’000

CONTINUING OPERATIONS:

Revenue 474 066 251 121 65 803 81 259 102 090

Gross profit 123 012 63 205 23 125 33 515 46 430

Other income 703 361 654 444 355

Other (losses)/gains (2 719) 4 270 – – –

Operating costs (78 158) (48 331) (29 174) (27 972) (31 302)

Earnings/(loss) before interest, taxation, depreciation, amortisation and impairments 42 838 19 505 (5 395) 5 987 15 484

Development cost impairment – (1 168) (868) (8 536) –

Goodwill impairment – – – (7 907) –

Depreciation and amortisation (10 759) (2 201) (1 947) (3 772) (3 872)

Profit/(loss) before interest and taxation 32 079 16 135 (8 210) (14 228) 11 612

Finance income 1 419 34 3 – 3

Finance cost (4 996) (1 842) (903) (1 112) (850)

Profit/(loss) before taxation 28 502 14 327 (9 110) (15 340) 10 765

Taxation (8 529) (4 302) 2 085 2 792 (2 843)

Profit/(loss) for the period from continuing operations 19 974 10 025 (7 025) (12 548) 7 922

Other comprehensive income, net of taxation – – – – –

Total comprehensive income/(loss) for the year 19 974 10 025 (7 025) (12 548) 7 922

FIVE-YEAR REVIEW


201644

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

31 March 28 February 28 February 28 February 29 February2016 2015 2014 2013 2012

R’000 R’000 R’000 R’000 R’000

Assets

Non-current assets 175 492 27 091 33 974 31 751 46 447

Property, plant and equipment 43 053 1 716 1 584 509 920

Intangible assets 120 418 16 869 19 229 21 604 36 010

Deferred tax asset 12 021 8 506 13 161 9 638 9 517

Current assets 249 489 124 739 53 837 31 873 30 744

Inventories 84 774 40 533 29 218 8 265 9 136

Trade and other receivables 121 682 64 816 24 031 23 398 21 276

Derivative financial assets – – 80 4 –

Cash and cash equivalents 42 358 19 390 508 54 180

Current tax receivable – – – 152 152

Other financial assets 675 – – – –

Total assets 424 981 151 830 87 811 63 624 77 191

Equity and liabilities

Equity 201 271 42 433 32 408 37 435 49 443

Capital and reserves 201 271 42 433 32 408 37 435 49 443

Non-current liabilities 48 887 10 496 12 011 2 452 5 125

Loan from related parties – 9 070 9 993 – –

Interest bearing borrowings 32 509 532 436 – –

Deferred tax liability 10 006 894 1 582 2 452 5 125

Other financial liabilities 6 372 – – – –

Current liabilities 174 823 98 901 43 392 23 737 22 624

Loans from related parties – 5 998 – 2 133 3 456

Trade and other payables 152 382 89 938 35 282 12 959 14 259

Derivative financial liabilities – – – – 291

Bank overdraft 14 705 – 7 722 8 645 4 617

Current tax payable 1 460 335 – – –

Current portion of interest bearing borrowings 2 703 350 179 – –

Other financial liabilities 2 070 – – – –

Provisions 1 503 2 280 209 – –

Total equity and liabilities 424 981 151 830 87 811 63 624 77 192


201645

CONSOLIDATED STATEMENTS OF CASH FLOWS13 months

ended12 months

ended12 months

ended12 months

ended12 months

ended31 March 28 February 28 February 28 February 29 February

2016 2015 2014 2013 2012R’000 R’000 R’000 R’000 R’000

Cash flows from operating activities before working capital 33 194 17 823 (6 886) 4 581 14 871

Changes in working capital (66 989) 4 626 10 431 (2 555) (14 686)

Cash flows from operating activities (33 795) 22 449 3 545 2 026 185

Cash flows from investing activities 914 (643) (329) (5 397) (6 848)

Cash flows from financing activities 41 143 4 798 (1 839) (784) 3 762

Cash flows for the year 8 263 26 604 1 377 (4 153) (2 902)

Cash and cash equivalents at beginning of year 19 390 (7 214) (8 591) (4 438) (1 536)

Cash and cash equivalents at end of year 27 653 19 390 (7 214) (8 591) (4 438)

PER SHARE FINANCIAL INFORMATION13 months

ended12 months

ended12 months

ended12 months

ended12 months

ended31 March 28 February 28 February 28 February 29 February

2016 2015 2014 2013 2012R’000 R’000 R’000 R’000 R’000

Number of shares in issue

– total 461 038 321 244 867 056 244 867 056 164 867 056 161 867 056

– weighted 410 797 070 244 867 056 182 620 480 162 162 946 155 994 105

– diluted 410 797 070 244 867 056 182 620 480 162 162 946 155 994 105

Basic earnings/(loss) per share (cents)

– total 4,86 4,09 (3,85) (7,74) 5,08

– from continuing operations 4,86 4,09 (3,85) (7,74) 5,08

Diluted earnings/(loss) per share (cents)

– total 4,86 4,09 (3,85) (7,74) 5,08

– from continuing operations 4,86 4,09 (3,85) (7,74) 5,08

Headline earnings/(loss) per share (cents)

– total 4,86 4,44 (3,58) 2,4 5,06

– from continuing operations 4,86 4,44 (3,58) 2,4 5,06

FIVE-YEAR REVIEW CONTINUED


201646

CORPORATE GOVERNANCE

This Corporate Governance Report sets out the key qualitative governance principles and practices of Ansys.

Ansys’ board and the various committees endorse the Code of Corporate Practices and Conduct (“the code”) as set out

in the King Report on Corporate Governance (“King III”) and substantially follow the recommendations and principles of

the Code. The board is committed to the principles of discipline, transparency, independence, social responsibility and accountability,

in dealings with all stakeholders, as well as complying with the JSE Limited’s Listings Requirements. The board accepts that effective

corporate governance practices are necessary to achieve and maintain trust and confidence in the organisation at all levels and

aims to integrate responsible corporate citizenship into the group’s business operations, to ensure sustainable long-term growth.

The board further acknowledges that this is a dynamic responsibility that demands continuous, unrelenting attention

and focus.

The directors are committed to an open governance process giving all stakeholders the assurance that its directors and managers

at all levels are managing the company responsibly. All of the members of the board are individually and collectively aware of their

responsibility to ensure that financial statements fairly represent the state of affairs of the group, and the board therefore keeps its

performance and core governance principles under regular review. In line with King III’s “apply or explain” approach, the directors

will continue to state the extent to which the company applies good corporate governance principles to create and sustain value for

stakeholders over the short, medium and long term, and to explain any non-compliance.


201647

THE BOARD

Board charter The board acts in accordance with an approved board charter, which is reviewed on a regular basis. The charter is in line with the company’s memorandum of incorporation (“MOI”), which amongst others regulates the composition, scope of authority, responsibility and functions of the board. A balance of authority is ensured through an agreed division of responsibility. No individual has unrestricted decision making powers.

Responsibilities and functions

The board’s primary responsibilities and functions include, but are not limited to:• oversight of the group’s strategic direction and the control of the group• setting the values which the company will adhere to, as formulated in its Code of Conduct• ensuring that its conduct and that of management aligns to the values and is adhered to in all aspects

of its business• ensuring that all deliberations, decisions and actions are based on the four values of good governance• ensuring that the company acts as, and is seen to be, a responsible corporate citizen• ensuring that appropriate governance structures, policies and procedures are in place• ensuring the effectiveness of the group’s internal controls• reviewing and evaluating the group’s risks• approving the annual budget and operating plan• approving the annual and interim financial results and shareholder communications• approving the senior management structure, responsibilities and succession plans.

Board meetings The board meets at least four times per annum and if and when necessary otherwise. Directors’ attendance of board meetings is shown on page 51. A formal agenda is issued for each board meeting and supporting documentation is distributed to all directors at least five working days before a board meeting to provide sufficient time for preparation.

Board composition and members

Ansys has a unitary board structure, with eight directors.

The board composition is as follows: • Teddy Daka Group Chief Executive Officer (Group CEO) • Burt Christiaan Lamprecht Group Chief Financial Officer (Group CFO)• Andries Rynier van der Watt Chief: Strategy, mergers and acquisition• Five independent non-executive directors*: – Nonhlanhla Sylvia Mjoli-Mncube Chairman – Sizakele Petunia Mzimela; – Coenraad Petrus Bester; – Nondumiso Medupe; and – Dr Snowy Joyce Khoza

* Independent non-executive directors are independent in line with recommendations as set out in King III and the

JSE Listings Requirements

Resignations and appointments made during the financial period

Rachelle Grobbelaar Resigned as group chief financial officer 31 December 2015Andries Rynier van der Watt Appointed 1 June 2015Coenraad Petrus Bester Appointed 1 June 2015Nondomiso Medupe Appointed 9 September 2015Dr Snowy Joyce Khoza Appointed 21 October 2015Burt Christiaan Lamprecht Appointed as group chief financial officer 1 April 2016**

**Appointment of Burt Christiaan Lamprecht was subsequent to the financial period-end.

Evaluations Individual director, chairman, executive directors and board evaluations were conducted during FY2016 and the board was satisfied with the overall outcome thereof.

Achievements during the year

• Enhanced governance structures• Strengthening of the board• The company moved to an inclusive approach to stakeholders, whereby the legitimate interests of

stakeholders (e.g. employees, suppliers, customers, regulators, environment, community, etc.) were considered and recognised over and above solely the shareholders’ interests, in a manner which befits the long-term sustainability of the entity

• Realignment of group strategy

CORPORATE GOVERNANCE CONTINUED


201648

COMMITTEES

Reconstitution of committees: On 16 March 2016 the board agreed that the previous Social, Ethics and Remuneration Committee be separated into two separate committees. The Social and Ethics Committee as well as the Human Capital and Remuneration Committee were subsequently constituted.

Group EXCOAudit and Risk Committee

Social and Ethics Committee

Nominations Committee

Human Capital and Remuneration Committee

Responsibilities

• Reviewing operations in detail on a monthly basis

• Monitoring and managing risk

• Developing and implementing the group strategic plan

• Determining human resources policy and practices

• Preparing budgets and monitoring expenditure

• Monitoring operational performance against agreed KPIs and targets

• Adhering to financial and capital management policies

• Appointment and assessment of independence of the external auditor

• Financial statements and accounting practices

• Internal financial control

• Risk management

• Evaluation of the Group CFO

• Integrated reporting and combined assurance model

(For the full report see page 73)

• Monitoring initiatives to promote diversity

• Supporting management in embracing principles of transformation

(For the full report see page 60 and for further details see ‘Impacts of our business’ on pages 58 to 68)

• Advising on the composition of the board

• Reviewing the board structure, size and balance between non-executive and executive directors

• Identifying and recommending qualified candidates for directorships

• Ensuring that the board has an appropriate balance of skills, experience and diversity

• Succession planning

• Ensuring a policy on the promotion of gender diversity at board level.

• Ensuring the remuneration policy is competitive and will appropriately attract, retain and reward skilled and quality employees

• Assessing executive and non-executive directors’ remuneration

• Assessing the performance of the executive directors in executing their functions

• Determining short- and long-term incentives for group executives

Delegation

Board delegates the authority to the Group CEO for implementation of strategy and the daily running of the group

The committee is a statutory committee under the Companies Act and JSE Listings Requirements (and in the recommendations set out in King III) and as such is responsible for prescribed statutory duties as well as any additional responsibilities

The committee is a statutory committee under the Companies Act and JSE Listings Requirements (and in the recommendations set out in King III) and as such is responsible for prescribed statutory duties as well as any additional responsibilities

The committee is appointed by the board

The committee is appointed by the board


201649

COMMITTEES

Reconstitution of committees: On 16 March 2016 the board agreed that the previous Social, Ethics and Remuneration Committee be separated into two separate committees. The Social and Ethics Committee as well as the Human Capital and Remuneration Committee were subsequently constituted.

Group EXCOAudit and Risk Committee

Social and Ethics Committee

Nominations Committee

Human Capital and Remuneration Committee

Members

Teddy Daka(Group CEO)

Burt Lamprecht(Group CFO)

Elena Bielich(Group HR)

Rynier van der Watt(Chief: Strategy, mergers and acquisitions)

Lebo Masekela(Chief Executive: Ansys Rail)

Dirk Fourie(Chief Operational Executive: Tedaka Network Solutions)

Petrus Pelser(Managing Director: Parsec)

Invitees Company Secretary

Ndumi Medupe (Chairman)Siza MzimelaCoen BesterDr Snowy KhozaCompany Secretary

InviteesGroup CEOGroup CFOExternal AuditorChief: Strategy, mergers and acquisitionsDesignated advisor

Dr Snowy Khoza (Chairman)Ndumi MedupeNonhlanhla Mjoli-MncubeCompany Secretary

InviteesGroup CEOGroup CFOExecutive directors

Nonhlanhla Mjoli-Mncube (Chairman)Siza MzimelaNdumi MedupeDr Snowy KhozaCoen BesterTeddy DakaCompany Secretary

Coen Bester (Chairman)Nonhlanhla Mjoli-MncubeSiza MzimelaCompany Secretary

InviteesGroup CEOGroup HR

Number of independent non-executive directors

N/A 4/4 2/3 5/6 3/3

Attendance

Attendance of meetings is available on page 51.

Achievements during the year

• Integration of Parsec Holdings

• Implementation of realigned strategy

• Executive management bolstered

• Group risk matrix is considered at each meeting

• Considered the reporting structures on the company’s top risks and necessary controls to mitigate these

• Considered and made recommendations towards the implementation of all relevant IT governance mandates, policies, processes and control frameworks

• Satisfied itself that the group finance function has the required expertise and adequacy of resources

• Terms of reference were reviewed and adopted by the committee

• The committee further adopted the Social and Ethics scorecard

• Appointment of two additional non-executive directors to the board

• Terms of reference were reviewed and adopted by the committee

• The remuneration policy was adopted

A brief curriculum vitae for each director is set out on pages 36 to 38 of the integrated annual report.

All committees are governed by formal terms of reference which are available at www.ansys.co.za.



201650

SUMMARY OF MEETING ATTENDANCE

BOARD MEETINGSTotal meetings: 7 (Including Strategy Session)

Attended Comment

T Daka 7/7

R Grobbelar 6/6 Resigned 31 December 2015

F Dantile 2/2 Resigned 9 September 2015

S Mzimela 6/7

N Mjoli-Mncube 7/7

R van der Watt 4/5 Appointed 1 June 2015

C Bester 5/5 Appointed 1 June 2015

N Medupe 5/5 Appointed 9 September 2015

Dr S Khoza 1/4 Appointed 21 October 2015

Company Secretary 7/7

SPECIAL BOARD MEETINGSTotal meetings: 1

Attended Comment

T Daka 1/1

R Grobbelar 1/1 Resigned 31 December 2015


S Mzimela 1/1

N Mjoli-Mncube 1/1

R van der Watt 1/1 Appointed 1 June 2015



NOMINATION COMMITTEE MEETINGSTotal meetings: 2

Attended Comment

N Mjoli-Mncube 2/2

S Mzimela 2/2


Dr S Khoza 1/1 Appointed 21 October 2015


T Daka 2/2


AUDIT AND RISK COMMITTEE MEETINGSTotal meetings: 5

Attended Comment

N Medupe 3/3 Appointed 9 September 2015 as member and 16 November 2015 as Chairman


S Mzimela 5/5


N Mjoli-Mncube 2/2 Resigned 9 September 2015


SOCIAL, ETHICS AND REMUNERATION COMMITTEE MEETINGSTotal meetings: 2

Attended Comment




N Mjoli-Mncube 2/2



201651


THE BOARDThe board ensures effective control over the group by

continuously monitoring the implementation of strategies,

policies and goals which are prepared by executive

management based on the group’s core competencies, existing

skills, overarching values and ultimate goal of value creation.

Ansys’ unitary board at period-end comprised eight directors,

three of whom were executives, and five of whom were

independent non-executives.

Chairman

The independence of the chairman is paramount to the

successful implementation of good corporate governance

practices at board level.

The chairman of the board is charged with providing the

board with leadership, and to harness the talents and energy

contributed by each of the individual directors.

The core functions and responsibilities of the chairman are set

out a follows:

• To govern the workings of the board, including directing the

meetings of the board and acting as a conciliatory element

when elements of the board differ

• To provide overall leadership to the board

• To set the ethical tone for the board and the company

• To act as the link between the board and management and

particularly between the board and the Group CEO

• To provide independent advice and counsel to the Group CEO

• To keep abreast generally of the activities of the company

and its management

• To serve on other committees of the board where

appropriate as determined by the board

• To ensure that good relations are maintained with the

company’s major shareholders and its strategic stakeholders

and preside over shareholders’ meetings

• In concert with the Group CEO, to determine the date, time

and location of the annual meeting of shareholders and to

develop the agenda for the meeting

• To act as chairman at meetings of shareholders

• To formulate (with the Group CEO and company secretary)

the yearly work plan for the board against agreed objectives,

and to play an active part in setting the agenda for board

meetings and to recommend an annual schedule of the date,

time and location of board and committee meetings

• To call special meetings of the board where appropriate

• To ensure that complete, timely, relevant, accurate, honest

and accessible information is placed before the board to

enable directors to reach an informed decision

• To uphold rigorous standards of preparation for meetings

• To preside over board meetings and to ensure that time in

meetings is used productively

• To use this power appropriately and not to influence the

outcome of the meetings towards a specific agenda

• To ensure that regularly, upon completion of the ordinary

business of a meeting of the board, the directors hold

discussions without management present

• To review and sign minutes of board meetings

• To ensure that decisions by the board are executed

• To manage conflicts of interest

• To recommend to the board, after consultation with the

directors, management and the Nominations Committee,

the appointment of members of the committees of the board;

• To identify and participate in selecting board members (via a

Nominations Committee)

• To assess and make recommendations to the board annually

regarding the effectiveness of the board as a whole, the

committees of the board and individual directors

• To oversee a formal succession plan for the board, Group CEO

and certain senior management appointments such as the

chief financial officer

• To ensure that all directors are appropriately made aware of

their responsibilities through a tailored induction programme,

and to ensure that a formal programme

of continuing professional education is adopted at

board level

• To ensure that directors play a full and constructive role in

the affairs of the company and take a lead role in the process

for removing non-performing or unsuitable directors from

the board.

The performance of the chairman is assessed by the board

every second year. No one director has unfettered power of

decision-making.

Executive directors

The executive directors of Ansys are involved in the group on

a day-to-day basis and have entered into service contracts

exceeding three years. The group currently has three executive

directors on the board of directors, namely Teddy Daka,

Burt Christiaan Lamprecht, and, Andries Rynier van der Watt.

The executive directors are individually mandated and held

accountable for:

• the implementation of strategies and key policies determined

by the board


201652

• managing and monitoring the business and affairs of the

group in accordance with approved business plans

and budgets

• prioritising the allocation of capital and other resources; and

• establishing the best managerial and operational practices

for the group.

Group chief executive officer

The Group CEO is responsible for the day-to-day operations

of the businesses, the development and implementation of

strategy, and the submission of business plans and budgets to

the board for consideration.

In this regard the Group CEO is assisted by the Group EXCO.

See page 37 for a brief curriculum vitae of the Group CEO.

Independent non-executive directors

The independent non-executive directors are high merit

individuals who objectively contribute a wide range of industry

skills, knowledge and experience to the board’s decision-

making process. (See pages 36 to 39 for curricula vitae of

the independent non-executive directors.) These directors

are not involved in the daily operations of the group.

The independent non-executive directors are also entitled

to seek independent professional advice on any matters

concerning the affairs of the group, at the group’s expense.

Each non-executive director is given a letter of appointment.

Rotation of directors

All directors, other than the Group CEO, Group CFO and

Chief: Strategy, mergers and acquisitions, are subject to

retirement and re-election by shareholders. Re-election takes

place on a staggered basis to ensure continuity. Reappointment,

however, is not automatic. Appointments of new directors are

subject to confirmation by shareholders at the first annual

general meeting after their appointment.

The board agreed, after satisfying themselves as to the

past contributions, to recommend the re-election of

Coenraad Petrus Bester and Nondumiso Medupe, who will

retire at the upcoming annual general meeting and who

offered themselves for re-election.

Appointment to the board and Induction

The board as a whole is responsible for the nomination and

appointment process for new directors, which is transparent,

and is assisted in this regard by the Nominations Committee.

When making appointments, the board considers skills,

knowledge, experience and the overall composition of

the board.

All new directors are required to attend a formal induction

programme, which includes site visits to operations and

provision of all policies and procedures. In addition,

new directors are required to attend the AltX Induction

Programme presented by the Institute of Directors in

South Africa (“the IODSA”).

In light of new directors’ extensive industry and business

experience, additional development programmes have not been

deemed necessary, but would be considered and implemented if

considered necessary. The Company Secretary is responsible for

keeping the board abreast of new legislation, recommendations

and best practice.

BOARD PROCESSESBoard succession planning

An informal succession plan is in place for the chairman,

Group CEO and senior management. The succession plan will be

formalised as part of the integration of Parsec.

Share dealings and conflicts of interest

Share dealings are governed in terms of an Insider Trading

Policy in line with the JSE Listings Requirements. Directors

are not allowed to trade in securities of the company prior

to obtaining written consent in line with the JSE Listings

Requirements. The chairman receives clearance from the

chairman of the Audit and Risk Committee to trade in securities

of the company. It is also mandatory for directors to notify the

Company Secretary of any dealings in company shares. This

information is then disclosed on SENS within 48 hours of the

trade being made.

No instances of non-compliance were reported during the year.

The director dealings during the period were as follows:

Nonhlanhla Sylvia Mjoli-Mncube purchased 4 000 000 ordinary

shares in Ansys Limited on 20 July 2015. She obtained the

necessary clearance and the information was disclosed on

SENS within the prescribed period.

Rachelle Grobbelaar purchased 95 000 ordinary shares in

Ansys Limited on 31 August 2015. She obtained the necessary

clearance and the information was disclosed on SENS within the

prescribed period

Directors of the company are obliged and, at every board

meeting, given the opportunity to disclose any material interest


201653

in contracts with the company or its subsidiaries in terms of

Section 75 of the Companies Act. Such disclosures are noted

by the Company Secretary and kept in a separate register

of directors’ disclosures. During the period under review,

disclosures were updated where deemed necessary.

Price-sensitive information

The company acts in accordance with the JSE Limited’s

guidelines on price-sensitive information.

The company follows a “closed period” principle, during which

employees and directors are prohibited from dealing in the

company’s shares. Closed periods are usually from end March

until the publication of the March year-end results and also

from end September until the publication of the September

interim results. Additional periods may be declared “closed”

from time to time.

SUPPORT FUNCTIONSCompany Secretary

Access to the advice and services of the Company Secretary and

to company records, information, documents and property is

unrestricted.

The Company Secretary – Fusion Corporate Secretarial

Services Proprietary Limited – is a third-party practice, and was

appointed as the Company Secretary of the group during 2008

and retains the office.

The board assessed the competence, qualifications and

experience of the Company Secretary and was satisfied that

Fusion Corporate Secretarial Services Proprietary Limited

is sufficiently qualified and skilled to act in accordance with

and update directors in terms of King III and other relevant

regulations and legislation.

The board was further satisfied that the Company Secretary

remains independent from Ansys. There is no special

relationship between the Company Secretary and any of the

directors, in that the Company Secretary and/or any of her

employees are not a relative of or closely related to any of

the directors. The board was therefore satisfied that an arm’s

length relationship exists.

The Company Secretary is responsible for guiding the board in

discharging its regulatory, fiduciary and ethical responsibilities

and in addition, the Company Secretary ensures compliance

with laws and regulations.

Directors have unlimited access to the advice and services of

the Company Secretary. The Company Secretary plays a role

in the company’s corporate governance and ensures that,

in accordance with the pertinent laws, the proceedings and

affairs of the board, the company itself and, where appropriate,

shareholders are properly administered. The Company

Secretary also monitors directors’ dealings in securities and

informs directors and other relevant parties of closed periods.

The Company Secretary attends all board and committee

meetings and records the minutes.

Designated advisor

Exchange Sponsors Proprietary Limited was appointed as the

designated advisor to the group on listing in 2007 and retains

the office.

Transfer secretary

Computershare Investor Services Proprietary Limited is

the transfer secretary for Ansys and assists all the group’s

shareholders with enquiries pertaining to the shareholding and

the distribution of the IAR and alll relevant material.

Board committees

Ansys has an established Audit and Risk Committee, Social and

Ethics Committee, Human Capital and Remuneration Committee

and Nominations Committee to assist the board in discharging

its responsibility of corporate governance, as above. There is

transparency and full disclosure from board committees to the

board in the form of verbal reports by the respective committee

chairmens recent activities at meetings, and the minutes of

committee meetings are available to the board at any time.

Attendance of committee meetings is set out on page 51.

The board was satisfied that all committees have satisfied their

responsibilities during the year.

The chairmen of the respetive committees or a nominated

committee member attends the company’s annual general

meeting to answer any questions from stakeholders pertaining

to them.

See page 73 for the Audit and Risk Committee report and

page 60 for the Social and Ethics Committee Report and page 63

for the Human Capital and Remuneration Committee report.


201654


King III Code of Corporate Practices and Conduct: Compliance

“Apply or explain” principle of King III.

The board supports the Code of Corporate Practices and Conduct as recommended by the King III Report on Corporate Governance

for South Africa 2009 (“King III”).

This integrated report contains a summary of Ansys’ application of the principles contained in Chapter 2 of King III as well as those

principles that link to the other chapters of King III.

An analysis of the application of the 75 corporate governance principles is however available on the website: www.ansys.co.za

APPLICATION OF KING III AND COMPANIES ACT

KING III PRINCIPLE DESCRIPTION COMPLIANCE

2.1 The board should act as the

focal point for and custodian

of corporate governance

The board assumes ultimate responsibility for compliance with the corporate

governance principles as stipulated in the King Report. The board charter is

based on these principles. The board meets at least once a quarter and corporate

governance is a standard item on the agenda. The board provides a comprehensive

corporate governance report to stakeholders in the integrated report.

2.2 The board should

appreciate that strategy,

risk, performance and

sustainability are inseparable

The risk management strategy is approved by the board and reviewed quarterly by

the Audit and Risk Committee. The strategy takes cognisance of inherent risks of

the group’s business and the need to achieve sustainable outcomes.

2.3 The board should provide

effective leadership based on

an ethical foundation

The board operates in accordance with a clearly defined charter which sets out

all aspects of effective and ethical leadership. The board is responsible for the

development of the group’s strategy and is continuously monitoring the execution

thereof. Great emphasis is placed on operating in an ethical and sustainable

manner to promote the long-term interests of all stakeholders. The board requires

that all employees of the group act ethically at all times.

2.4 The board should ensure

that the company is and is

seen to be a responsible

corporate citizen

The Social and Ethics Committee monitors the group’s activities and the impact

thereof on society and the environment. It strives to protect and invest in the

well-being of society and the environment and has adopted specific policies and a

code of ethics to ensure adherence its principles. The group and its employees are

required to operate in accordance with these policies and the Code of Conduct.

2.5 The board should ensure that

the company’s ethics are

managed effectively

The board ensures that the group’s ethical standards are clearly articulated

and supported as an integral part of conducting its business. Management is

required to report on the group’s activities in relation to the group’s ethics to

the Social and Ethics Committee. The board continuously monitors the group’s

standard of ethical behaviour and accountability by management and all

employees of the Group.

The board continues to consider the recommendations of King III with reference to the group and company’s size and stages of development.


201655

RISK MANAGEMENT

Risk management remains integral to the day-to-day

operation of our business. In the ordinary course of

business the group is exposed to a wide range of

risks that may have serious consequences for our operations

and performance, and therefore our sustainability. Effective

management of this supports the delivery of our objectives

and achievement of sustainable growth.

We adopt a holistic approach to managing uncertainty,

representing both risk and opportunity. The aim is to establish

the acceptable level of risk in each area of business, which

should be as low as reasonably practical, while taking full

advantage of the highest returns possible to maximise

shareholder wealth. In all risk management activities,

Ansys complies with King III.

RISK MANAGEMENT FRAMEWORKBoard

The board retains ultimate responsibility for the control and

mitigation of risk.

The directors are responsible for the group’s systems of

internal control as they determine them necessary to enable the

preparation of financial statements that are free from material

misstatement, whether due to fraud or error, and to maintain

adequate accounting records and an effective system of risk

management. The board annually evaluates the adequacy and

effectiveness of internal control systems and processes, and

monitors whether internal control recommendations have been

implemented.

The systems are designed to safeguard and maintain

accountability of the group’s assets and should identify and

curtail significant fraud, potential liability, loss and material

misstatement while complying with applicable statutory laws

and regulations.

The systems of internal control are designed to manage rather

than eliminate risk. Absolute assurance cannot be provided as

inherent limitations in the system’s effectiveness exist due to

human involvement.

No material matter came to the attention of the board

during the period to indicate a breakdown in the internal

systems of control.

Audit and Risk Committee

The Audit and Risk Committee is responsible for overseeing the

group’s risk management programme and reporting thereon to

the board. The Audit and Risk Committee approves the group’s

risk appetite and ensures it is aligned with strategy. Formal risk

assessments are conducted at least once a year.

Group CEO

The day-to-day responsibility for risk management resides

with the Group CEO. He is accountable to the board for

designing, implementing and monitoring the risk management

framework throughout the group and submits reports at each

Audit and Risk Committee meeting.

External audit and other professional providers

The independent external auditors, PricewaterhouseCoopers Inc.,

as recommended by the Audit and Risk Committee and

appointed by the company’s 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

and Risk Committee, meets regularly with the external auditors

and formally evaluates their independence annually.


201656

IT governance

The board acknowledges its responsibility for IT governance

and business continuity as part of its assumption of

responsibility for risk management at the group, and recognises

the importance of aligning the company’s IT strategy with our

revised business strategy and objectives. IT governance in the

group is managed and monitored in the following way:

• The Audit and Risk Committee oversees that a group-

wide IT policy is in place and that IT risk management

is considered as part of the company’s risk

management process

• An IT subcommittee of group EXCO has been established

and is responsible for creating a group-wide IT policy and to

manage cross-company and group-wide IT resources in the

group. The IT subcommittee consists of representatives of all

the companies in the group

• Each company in the group owns and controls its own

IT infrastructure. An IT representative is appointed in

each company and is responsible for the IT management of

the company

• An IT usage policy is required for each company in the

group which is in line with the group-wide IT policy.

The IT representative is responsible for ensuring that the

IT usage policy is in place and remains in line with the

group-wide IT policy

The following aspects are specifically addressed through the

group-wide IT policy and management process:

• IT and network security

• Backup and restoration of data, including off-site backups

and disaster recovery

• Enrolment or removal of users

• Control of access to data and information of users based on

their access rights

• Internet, e-mail and social media monitoring and usage

policies

• Software legality

• Redundancy and fail over strategies

• Ensuring that up-to-date technology infrastructure and

equipment is maintained

Risk identification processThe risk management process is continuous, with well-defined steps.

Risks from all sources are identified.

Identified risks are assessed according to a materiality threshold.

If determined to be material, a formal process begins in which causal factors and

consequences are identified and the correlation with other risks and mitigating

controls is reviewed.

An assessment is undertaken of the potential direct and indirect impacts of social,

environmental or economic and governance risks.

The most material business risks are appropriately categorised based on

impact and likelihood of occurrence, together with amelioration control

measures.

THE IMPACTS OF OUR BUSINESS

We focus our efforts on inculcating an ethical and

performance-driven culture across our businesses in the

interest of all our stakeholders

SOCIAL AND ETHICS COMMITTEE REPORT

The chairman of the Social and Ethics Committee

(“the committee”) has pleasure in presenting to

shareholders this report for the financial period ended

31 March 2016.

COMPOSITION AND MEETING ATTENDANCEThe current members are as follows:

• Dr Snowy Khoza (Chairman);

• Ndumi Medupe

• Teddy Daka

During the financial period ended 31 March 2016 the

Social, Ethics and Remuneration Committee divided to form

two separate committees, namely the Social and Ethics

Committee and the Human Capital and Remuneration

Committee. Both these committees operate under separate

charters and independently from one another.

The Social and Ethics Committee meets at least twice a year

as per its terms of reference. During the reporting period,

two meetings were held. Details of attendance are set out

on page 51.

The Group CEO is a permanent member of the committee,

however, the Group CFO and other members of the executive

team attend meetings by invitation only. The Company

Secretary is the secretary to the committee.

ROLE, PURPOSE AND PRINCIPAL FUNCTIONS OF THE COMMITTEEThe role of the committee is to assist the board to ensure

that the group has implemented an effective policy that

will enhance the group’s ability to achieve its strategic

objectives in line with set criteria for the optimum social and

ethical environment.

The committee fulfils its role as assigned to it in terms of the

Companies Act read with Regulation 43 of the Companies

Regulations, 2011.

The committee is constituted as a committee of the board of

directors of Ansys Limited. The committee operates in line with

its approved terms of reference, which are reviewed on an

annual basis, as well as under the guidelines of an annual work

plan, ethics policy and a balanced scorecard.

The committee has an independent role, operating as an

overseer and a maker of recommendations to the board for

its consideration and final approval. The committee does

not assume the functions of management, which remain the

responsibility of the executive directors, officers and other

members of senior management.

The group is aligned to the King III principles therefore the role

of the committee includes the following:

• Implementation of the ethics management programme

in the group

• Monitoring of the values of the group

• Monitoring of ethical risks and opportunities

• Monitoring of the Code of Conduct

The committee assists the board to build and sustain an ethical

corporate culture in the group. The committee is required to

liaise closely with the Audit and Risk Committee to exchange

information relevant to issues pertaining to social, ethical and

reputational risk.


201660

The committee received and considered the following reports by management during the period under review:

• The committee’s terms of reference

• Ethics policy

• Safety, health and security policy statement

• Environmental policy statement

• Whistle blower policy

PRINCIPLE ANSYS’ APPLICATION

The 10 principles set out in the United Nations Global

Compact Principles and the OECD recommendations

regarding corruption

Ansys adheres to the principles set out in the UNGCP and the

OECD recommendations on corruption.

The Employment Equity Act Ansys meets the labour law requirements of the Employment

Equity Act and has formal policies on bribery and corruption

and protected disclosures.

The Broad-Based Black Economic Empowerment Act Ansys subscribes to the provisions of the Broad-Based

Black Economic Empowerment Act and is a Level 2 B-BBEE

contributor.

Good corporate citizenship, including the group’s:

• promotion of equality, prevention of unfair discrimination,

and reduction of corruption

• contribution to development of the communities in which

its activities are predominantly conducted or within which

its products and services are predominantly conducted

• record of sponsorship, donation and charitable giving

Ansys subscribes to the provisions of the Promotion of Equality

and Prevention of Unfair Discrimination Act. No incidents have

been reported.

The environment, health and public safety, including

the impact of the group’s activities and of its products

or services

Ansys subscribes to and is compliant with the Occupational

Health and Safety Act. One incident was reported and is

outlined on page 69.

Consumer relationships, including the group’s advertising,

public relations and compliance with consumer

protection laws

Ansys subscribes to and is compliant with the Consumer

Protection Act. No incidents have been reported.

Labour and employment, including:

• the group’s standing in terms of the International Labour

Organisation Protocol on decent work and working

conditions

• the group’s employment relationships, and its contribution

towards the educational development of its employees

Ansys supports and adheres to the terms of the International

Labour Organisation Protocol. Ansys is compliant with the

following Acts:

• Basic Conditions of Employment Act 75 of 1997

• Labour Relations Act 66 of 1995

• Skills and Development Levies Act 9 of 1999

• Unemployment Insurance Act 63 of 2001

Ansys does not tolerate any use of child labour within its own

operations. Recruitment of appropriate personnel is conducted

according to the Ansys Code of Conduct, which includes

determining the age of an employee, whether permanent,

casual or temporary, before employment.

The committee continued to monitor the group’s activities, having regard to any relevant legislation, other legal requirements

or prevailing codes of best practice, with regard to matters relating to social and economic development, including the group’s

standing in terms of the goals and purposes of:


201661

SOCIAL AND ETHICS COMMITTEE REPORT CONTINUED

Furthermore, the group introduced a tailor-made social and

ethics scorecard to illustrate the social and ethics application

and implementation of the scorecard within the group.

The priority perspectives of the scorecard include the

following categories:

• Employee perspective

• Environmental perspective

• Social policies followed

• Management and economic risk perspective

Different weighting percentages are allocated to each of

the respective categories, against which performance will

ultimately be measured. The committee spent adequate time

on evaluating and expanding the target values for each of the

16 indicators included in the scorecard.

No substantive non-compliance with legislation and regulations

relevant to the areas within the committee’s mandate has

been brought to its attention during the period under review.

The committee also has no reason to believe that any such

non-compliance has occurred.

Management reports to the committee on matters relevant

to its deliberations to enable the members to fulfil their

responsibilities. The committee draws these matters to the

attention of the board as occasion requires and one of its

members reports to the shareholders at the company’s annual

general meeting on the matters within its mandate.

The group operates under a Code of Conduct which includes

business ethics. This is enforced throughout the group.

The Code of Conduct is available on the company’s website

www.ansys.co.za. The requirements of the Code of Conduct

have largely been met during the period under review.

DR SNOWY KHOZAChairman: Social and Ethics Committee13 September 2016


201662

HUMAN CAPITAL AND REMUNERATION COMMITTEE REPORT

The chairman of the Human Capital and Remuneration

Committee (“the committee”) has pleasure in

presenting to shareholders this report for the financial

period ended 31 March 2016.

COMPOSITION AND MEETING ATTENDANCEThe current members are as follows:

• Coen Bester (Chairman);

• Nonhlanhla Mjoli-Mncube; and

• Siza Mzimela

The committee meets at least twice a year as per its terms of

reference. During the reporting period, two meetings were held.

Details of attendance are set out on page 51.

The Group CEO and Group CFO attend meetings by

invitation only.

ROLE, PURPOSE AND PRINCIPAL FUNCTIONS OF THE COMMITTEEThe main purpose of the committee is to ensure the adoption

of human capital and remuneration strategies and policies in

order to attract, develop and retain top talent for the group as

a whole.

The committee is constituted as a committee of the board of

directors of Ansys Limited. The committee operates in line with

its approved terms of reference, which have been reviewed

for the period under review. Subsequently, the board approved

a change of scope of the committee to also address human

capital related matters. In order to provide stronger focus,

the social and ethics responsibilities of the committee

were transferred to the newly constituted Social and

Ethics Committee.

The committee fulfils its role assigned to it in terms of

regulation 43 of the Companies Act.

A synopsis of the role and responsibility of this committee is

available on page 49 of the Corporate Governance Report.

The period under review was especially busy for the committee

following the acquisition and integration of Parsec Holdings into

the group. This required, over and above its normal business,

the review of all existing and relevant group policies to ensure

coherence and consistency across the group. This included:

• the committee’s terms of reference

• the group’s remuneration policy

• the group’s human resources policy

• the group’s gender policy.

REMUNERATION STRATEGY AND PHILOSOPHYThe Ansys group has set itself the vision to become an IP-led

provider of technology-driven engineering solutions,

by producing world class products for global distribution,

with the aim of enhancing our clients’ competitiveness.

To achieve this vision, it is imperative that the group inculcates

a performance-driven culture across its businesses both in

the short and long term.

The remuneration philosophy reflects our commitment to

being compliant with best practice and our aspiration to be a

preferred employer. The group strives to reward corporate

and individual performance through an appropriate balance of

fixed pay, short-term and long-term variable pay components.

Annual remuneration packages are structured on a cost-

to-company basis and increases are benchmarked against

market-related surveys. Annual increases are also dependent

on individual achievement of respective key performance area

targets as well as subject to affordability by the group.

The purpose of the short-term variable pay is to ensure

alignment of individual objectives with those of group and

business units or with functional performance in terms of,

including but not limited to, financial targets, employment

equity and broad-based black economic empowerment, as

well as safety performance. The short-term variable pay is

expressly aimed at rewarding performance against targets set

at group, business unit and individual levels, including targets

for strategic projects and compliance issues where relevant.


201663

TRANSFORMATION AND GENDER POLICYAnsys endorses the Broad-Based Black Economic

Empowerment Act as well as all relevant legislation that shapes

the implementation and measurement of broad-based black

economic empowerment. This includes the amended Codes of

Good Practice, Charters and Sector Codes, Generics, the Codes

Process and the Department of Trade and Industry’s framework

for broad-based black economic empowerment.

The current B-BBEE score for Ansys Limited and Tedaka

Network Solutions is a Level 2 rating on the Generic ICT sector

scorecard. Parsec Proprietary Limited was rated separately and

scored a Level 3 on the current Generic ICT sector scorecard.

More detailed information pertaining to the B-BBEE scorecard

for Ansys Limited is available on page 66 of this report.

The committee is in the process of drafting the Ansys group

Gender Policy Statement.

Building the talent pipeline

Due to the Parsec Holdings acquisition, the technically skilled

human capital component within Ansys Limited increased

significantly. The group has a solid base of competent and

experienced employees. Our current focus is on youth and

diversity to ensure that the pipeline remains strong and

dynamic. During this financial period five employees under the

age of 35 were enrolled to study for BTech degrees.

HUMAN CAPITAL AND REMUNERATION COMMITTEE REPORT CONTINUED

The committee is in the process of formulating a long-term

incentive scheme for senior executives and the intention is to

finalise this in the next financial year. This incentive will strive to

ensure alignment with both group performance and retention

objectives in terms of attraction and retention of eligible senior

employees, as well as alignment with shareholders’ interests.

The committee determines the salaries for executive directors,

which are approved by the board. Executive directors do not

receive fees for services as a director.

Non-executive directors receive fees that are recommended

by the committee to the board for approval after the

committee considered independent benchmarking on Ansys’

peer companies. Non-executive directors receive fees for

services on the board and board committees and are paid

on a monthly basis. Non-executive directors do not receive

short-term incentives and do not participate in any long-term

incentive share scheme. The board recommends their fees to

shareholders for approval at the annual general meeting.

ANSYS GROUP HUMAN RESOURCES POLICYThe Ansys group human resources policy is being revised in

order to align policy across the group. It is envisaged that the

finalisation and implementation of this policy will be done

towards the end of 2016.

NUMBER OF EMPLOYEESDuring the period the Ansys group employed 243 individuals

with the following demographics:

Male Female

AfricanCol-

oured Indian White AfricanCol-

oured Indian White Total

Top management 3 0 0 7 4 0 0 1 15

Senior management 5 1 0 8 1 0 0 0 15

Professionally qualified/ middle management

3 0 0 11 2 0 0 3 19

Skilled technical / junior management

42 6 2 44 23 11 0 21 149

Semi skilled/machine operator/assemblers

18 4 0 1 7 6 0 0 36

Unskilled 2 0 0 0 7 0 0 0 9

Total employees 73 11 2 71 44 17 0 25 243


201664

Annually new interns and graduates are recruited.

An experiential learning programme for interns was followed

to meet technical and company needs. Ansys has embarked

on facilitating learnerships within the technical environment,

thereby empowering learners to become skilled and employable

either within the Ansys group or in the broader workplace.

A graduate engineering drive in collaboration with the local

universities is undertaken each year.

Our human capital strategy includes a major focus on skills and

leadership development.

Key organisational capabilities

Focus was placed on enhancing key organisational capabilities.

Through training initiatives, including training for new

managers, finance for non-financial managers, health and

safety awareness and job specific training, as well as improved

qualifications, there was a conscious drive to ensure that

capabilities are maintained, augmented and enhanced to add

value and meet current and future requirements. A number of

employees were enrolled for degrees such as an MBA, Masters

in Logistics and Supply Chain Management and BSc Honours in

Management of Technology.

In closing, I would like to extend a sincere word of thank to my

predecessor, Fezile Dantile, who laid the foundation for this

year’s work.

COENRAAD BESTERChairman: Human Capital and Remuneration Committee 13 September 2016


201665

B-BBEE LEVEL CONTRIBUTOR

During the period we maintained our Level 2 contributor rating.

Our empowerment verification excludes Parsec Holdings, who we acquired during the period under review. However,

the contribution and commitment towards transformation, as outlined below, is a representation of the entire group.

The directors continue to monitor progress against transformation objectives, supported by the Human Capital and Remuneration,

and Social and Ethics Committees.

Our newly formed B-BBEE Committee is driving the initiatives aimed at realising our strategic goal of progressing to Level 1 in the

short to medium term. To achieve this we have targets determined by Group EXCO. The B-BBEE Committee, at regular B-BBEE

Committee meetings, will monitor the group’s progress towards these targets. A group B-BBEE strategy is currently under review

and will be presented to the board for approval in due course.

B-BBEE scorecard

ICTCharter

GenericCharter

Scorecard rating 2016 2015 2014 2013 2012 2011

Ownership 20 21 20 22 18,49 17,21 17,08 15,00

Management control 10 10,82 10 8,25 6,56 4,72 1,50 0,75

Employment equity 10 6,48 15 4,11 3,33 2,83 2,76 0,00

Skills development 17 5,54 15 12,55 0,02 0,54 0,33 1,13

Preferential procurement 20 19,73 20 19,04 16,71 17,07 15,93 11,79

Enterprise development 11 11 15 11 15,00 15,00 14,27 15,00

Socio-economic development 12 12 5 12 5,00 5,00 3,75 2,21

RATING 2 2 4 5 5 6

MANAGEMENT CONTROLSignificant progress was made in transforming Ansys Limited’s top management and board of directors during the period under

review. Fifty percent of the board consists of four black females non-executive, while the other 50% comprises one black male

executive director, one white male non-executive director, and two white males executive directors. During this financial period,

the Group EXCO comprises two black males, four white males and one white female. The focus on transformation continues to be

an objective.

Black males

White males

Black females

White females Total

Top management 1 3 4 0 8

Executive top management 2 4 0 1 7

Total 3 7 4 1 15

EMPLOYMENT EQUITYGroup EXCO implements and adheres to the requirements of the Employment Equity Act. Employment equity has been

earmarked as an area of focus in the current year. Our approach to improving our employment equity is to focus on skills, training

and leadership development to ensure that wherever possible, we are able to promote our existing employees into leadership and

management positions.


201666

TRANSFORMATION

The allocation of the male and female employees in the various race groups is as follows:

Employment equity profile

Male Female Total per race

Black

44

117

73

Coloured

1728

11

Indian

2 0 2

White

25

96

71

SKILLS DEVELOPMENT AND TRAININGQuantifiable skills development expenditure was identified for previously disadvantaged employees for the period under review

at the time of the measurement. The target of our skills development and training for previously disadvantaged people was

R2,782 million with R1,801 million actual spend for the period, a 65% achievement against our target.

PREFERENTIAL PROCUREMENTThe group has almost achieved maximum points available for preferential procurement, mainly due to the focus placed on the

spend from Exempted Micro Enterprises (“EME”) and Qualifying Small Enterprises (“QSE”). The table below provides a summary of

how we performed against our target in the different procurement categories:

2016 2015Target R’000

Spend R’000

Target R’000

Spend R’000

Weighted BEE spend – all suppliers 117 338 168 683 55 226 75 277

Weighted BEE spend – QSE and EME 25 143 100 568 11 191 52 697

Procurement spend – black-owned 20 115 18 097 8 953 7 086

Procurement spend – black women-owned 13 410 3 312 5 968 1 980

Preferential procurement target vs. spend(R’000)

Weighted BEE spend -

all suppliers


QSE and EME


black owned


black women owned

2016

Target Spend


all suppliers


QSE and EME


black owned


black women owned

2015

Target Spend

55 226

20 115

3 31213 410

75 277

52 697

11 191 8 953 7 086 5 968 1 980

100 568

25 143

168 683

117 338

18 097

We have a policy of affirmative procurement preference wherever possible. We focus our efforts on suppliers and services from

within the communities in which we operate. The group has exceeded the weighted BEE spend for all suppliers, QSE and EME by

44% and 300% respectively .


201667

ENTERPRISE DEVELOPMENTThe group has contributed towards enterprise development to a value of R2,559 million (2015: R1,435 million) during the 2016

verification period. Enterprise development has been one of our primary focuses over the last few years. Our aim is to empower and

enable the transfer of skills by helping establish and grow engineering companies with which we can partner. Assistance can range

from donating stock, early payment of supplier invoices to technical assistance.

R2,559 millionSOCIO-ECONOMIC DEVELOPMENTAs a responsible corporate citizen Ansys is mindful of the potential positive and negative impacts the group has on the communities

in which we operate. Given the overwhelming socio-economic needs in South Africa, Ansys adopts a strict and strategic approach to

its giving to ensure maximum impacts.

R685 000SOCIO-ECONOMIC DEVELOPMENT – DONATIONS FOR EDUCATION

SANDEF EDUTRUST


201668

TRANSFORMATION CONTINUED

OUR PEOPLE

The Occupational Health and Safety Act 85 of 1993 requires the employer to establish and maintain, as far as reasonably practicable, a work environment

that is safe and without risk to the health and safety of the employees. However, it is not expected of the employer to take sole responsibility for health and safety. The Act is based on the principle that dangers in the workplace must be addressed by communication and cooperation between the workers and the employer.

SAFETY FRAMEWORKDuring the financial period under review, Ansys remained steadfastly committed to our policy of complying with the Occupational Health and Safety Act (as amended and hereinafter referred to as “the Act”) and other legislative requirements. We strive to improve and target zero accidents, incidents and occupational illnesses. Health and safety are part of our core values and are incorporated into all aspects of our business.

The board and the respective subsidiary management teams are committed to and accountable for providing a safe and healthy work environment with the policies and procedures in place that will prevent injuries and minimise losses through responsible behaviour.

During the month of October 2015, the telecommunications division (Tedaka Network Solutions Proprietary Limited) was audited and found to be compliant with the requirements and regulations of the Act.

The division was also successfully vetted against the requirements of the Vodacom Safety Requirements in April 2016.

The SHEQ Managers manage our safety risk and performance with the assistance of the safety officers and a Safety Committee that comprises the SHEQ representatives from each business facility. Safety Committee meetings are held to monitor performance and address the potential risks. The performance is communicated monthly in the Executive Committee meeting and information sessions. Regular internal inspections are conducted and incident notifications are recorded and reported during the committee meetings. Safety planning is reviewed for each project and legal compliance is assured against the client’s requirements and statutory regulations.

All employees are trained in accordance with the Act, company policy and client requirements according to a health and safety plan conforming to the applicable requirements. On-site safety issues are highlighted to employees by induction process, regular toolbox talks and daily safe task instructions. Corrective disciplinary action is implemented in the event of non-conformances. An incident was logged on 28 January 2016.

Corrective and preventative measures were implemented and we remain committed to the safety of all employees both on- and off-site.

Emergency evacuation and fire drills are scheduled twice a year.

ENVIRONMENTAL AWARENESSAnsys embarked on a recycling programme as part of its commitment to constantly minimise the negative impacts of our activities on the natural environment. Internal training and awareness programmes were established and production management processes improved to conform to applicable environmental management systems and regulatory requirements. Through an approved recycling institution identified by the organisation, an amount of 2 373 kilograms of waste was recycled in a controlled and traceable manner during 2015-2016.

QUALITY ASSURANCESince 1999 Ansys Limited has been accredited as ISO 9001:2008 certified. This governs our procedures and standards and ensures ongoing monitoring of our quality systems. An AUTOSHEQ web-based system was fully implemented and used to monitor our problems experienced in the execution of all projects (on- and off-site), as well as our SHEQ maintenance and infrastructure. The LAN based PRACAS database was phased out in favour of the web-based AUTOSHEQ system.

In order to improve on the implementation of our processes, the Redmine web-based tool, which was initially used as a project management tool, was optimised for product maintenance, production and supply chain environments. The tool was configured to implement the work flow requirements of each of these functions, resulting in a more task-driven environment with increased control, reporting and traceability functions. This resulted in improved management of project, maintenance, production and procurement activities. Processes were streamlined and our dependence on paper trails has been reduced.

Parsec Proprietary Limited has been certified to ISO 9001:2008 since 2002. A Quality Management System (“QMS”) has been implemented into every aspect of the business’ operations. The QMS is one of the shared spaces on Parsec’s intranet. Parsec continuously monitors the performance of the QMS through various means, such as JIRA for our failure reporting and corrective action system. JIRA allows for easy tracking of issues from the time they are logged until resolution.

Our intranets are platforms for the sharing of information on all employee levels. The group ISO 9001:2008 certifications attest to our clients our commitment to quality.


201669


201670

6


LEVEL OF ASSURANCE AND PREPARERThese financial statements have been audited in compliance with the applicable requirements of the Companies Act of South Africa. The financial statements were internally compiled under the supervision of BC Lamprecht CA(SA).

PUBLICATION DATE30 September 2016

7


Directors’ responsibilities and approval 72Certificate from the Company Secretary 72Audit and Risk Committee report 73Directors’ report 75Independent auditor’s report 77Statements of financial position 78Statements of comprehensive income 79Statements of changes in equity 80Statements of cash flows 81Notes to the annual financial statements 82


Share performance 126Analysis of shareholders 127Notice of annual general meeting 128Shareholders’ diary 138Form of proxy 139Election form 141Definitions 143Contacts IBC


201671


201672

DIRECTORS’ RESPONSIBILITIES AND APPROVAL

The directors are required in terms of the Companies Act of

South Africa to maintain adequate accounting records and

are responsible for the content and integrity of the financial

statements and related financial information included in this

report. It is their responsibility to ensure that the financial

statements fairly present the state of affairs of the group as at

the end of the financial year and the results of its operations

and cash flows for the year then ended, in conformity with

International Financial Reporting Standards.

The financial statements are prepared in accordance

with International Financial Reporting Standards and are

based upon appropriate accounting policies consistently

applied and supported by reasonable and prudent

judgements and estimates.

The directors acknowledge that they are ultimately responsible

for the system of internal financial control established by the

group and place considerable importance on maintaining a

strong control environment. To enable the directors to meet

these responsibilities, the board of directors sets standards

for internal control aimed at reducing the risk of error or loss

in a cost effective manner. The standards include the proper

delegation of responsibilities within a clearly defined framework,

effective accounting procedures and adequate segregation

of duties to ensure an acceptable level of risk. These controls

are monitored throughout the group and all employees are

required to maintain the highest ethical standards in ensuring

the company’s business is conducted in a manner that in all

reasonable circumstances is above reproach. The focus of risk

management in the group is on identifying, assessing, managing

and monitoring all known forms of risk across the group. While

operating risk cannot be fully eliminated, the group endeavours

to minimise it by ensuring that appropriate infrastructure,

controls, systems and ethical behaviour are applied and

managed within predetermined procedures and constraints.

The directors are of the opinion, based on the information and

explanations given by management, that the system of internal

control provides reasonable assurance that the financial

records may be relied on for the preparation of the financial

statements. However, any system of internal financial control

can provide only reasonable, and not absolute, assurance

against material misstatement or loss.

The directors have reviewed the group’s and the company’s

cash flow forecasts for the year to 31 March 2017 and, in the

light of this review and the current financial position, they are

satisfied that the group and company has access to adequate

resources to continue in operational existence for

the foreseeable future.

The external auditors are responsible for independently

auditing and reporting on the group’s financial statements.

The financial statements have been examined by the group’s

external auditors and their report is presented on page 77.

The financial statements and additional schedules set out

on pages 72 to 123, which have been prepared on the going

concern basis, were approved by the board of directors on

13 September 2016 and were signed on its behalf by:

TEDDY DAKA BURT LAMPRECHTGROUP CEO GROUP CFO

CERTIFICATE FROM THE COMPANY SECRETARY

I certify that, to the best of my knowledge, in accordance with

the Companies Act, 2008 (as amended) (“the Act”), Ansys has

lodged with the Registrar all returns as are required of a public

company in terms of section 88 (2) (e) of the Act, for the period

ended 31 March 2016 and, furthermore, that all such returns and

notices are to the best of my knowledge and belief, true, correct

and up to date.

MELINDA GOUSFUSION CORPORATE SECRETARIAL SERVICES PTY LTDCOMPANY SECRETARYPretoria

13 September 2016


201673

AUDIT AND RISK COMMITTEE REPORT

DEAR SHAREHOLDERThe Audit and Risk Committee (“the committee”) of the group

has pleasure in submitting its report, as required by the

Companies Act.

The committee is an independent statutory committee

appointed by the shareholders, in terms of the Companies Act

and recommendations of King III. Other oversight functions

are performed by the committee as determined by the board

of directors of the group. This report covers both these sets of

duties and responsibilities.

MEMBERSHIPGiven the growth of the group, the number of committee

members was increased to four non-executive directors to

enhance the committee’s governance oversight. Shareholders

will be requested to approve the appointment of the committee

members for the 2016 financial year at the upcoming annual

general meeting:

• Ndumi Medupe (Chairman – appointed 9 September 2015 as

member and 16 November 2015 as Chairman);

• Siza Mzimela;

• Dr Snowy Khoza (appointed 16 March 2016); and

• Coen Bester (appointed 9 September 2015).

The curricula vitae for each of these directors are set out on

pages 36 to 39. The board was satisfied that the committee

members collectively have sufficient academic qualifications

and/or experience in economics, law, corporate governance,

finance, accounting, commerce, industry, public affairs and

human resource management as required by section 94(5) of

the Companies Act, read with Regulation 42 thereto.

The committee meets at least twice annually, but met five times

during the period under review. This was due to there being

several matters tabled for discussion and approval outside of

the normal annual business cycle. Details of attendance are set

out on page 51.

The Goup CEO, Group CFO, Designated Advisors and the External

Auditors attend meetings by invitation only.

TERMS OF REFERENCEThe committee’s formal terms of reference have been approved

by the board of directors. The committee has conducted its

affairs and has discharged its responsibilities and assigned

functions in terms of section 94 (7) of the Companies Act, and

as contained in the committee’s charter.

STATUTORY ROLES AND RESPONSIBILITIESThe committee adopts a work plan annually, in advance,

in order to manage the discharge of its responsibilities under

the Companies Act, King III, its own charter and the JSE Listings

Requirements.

The committee has considered the independence of the

company’s external auditors, PricewaterhouseCoopers Inc.,

and is satisfied that, for the period under review, the external

auditors are independent.

The committee approved the external auditor’s fees for 2016

and the non-audit related services performed by the external

auditor during the year. It was noted that the non-audit related

fees were not material, and did not influence the independence

of the external auditor.

After assessing the requirements set out in the Companies

Act, the committee is satisfied with the independence and

objectivity of the external auditors, and recommends the

reappointment of the external auditors at the next annual

general meeting.

The committee has considered and satisfied itself of the

appropriateness of the expertise and experience of the Group CFO.

The committee was further satisfied that the company’s finance

function was adequately resourced by people with appropriate

expertise and experience. The committee was also satisfied

that the internal financial controls were effective.


201674

AUDIT AND RISK COMMITTEE REPORT CONTINUED

During the period under review, the Company received the

JSE Proactive Monitoring Report for the JSE, which will be

considered by the committee at its next scheduled meeting.

INTERNAL CONTROLSThe board as a whole currently considers the internal

controls, including financial controls. Based on discussions

with the external auditors regarding the results of the audit

and information and explanations given by management,

the committee has no reason to believe that there were any

material breakdowns in the effectiveness of internal financial

controls during the year which have not been addressed or were

not in the process of being addressed. Therefore the financial

records can be relied on for preparing financial statements.

INTERNAL AUDIT FUNCTIONThe group does not yet have an internal audit function.

Management is, however, confident that it has implemented

a system of internal financial controls that gives sufficient

comfort that the annual financial statements are free from

material errors or omissions.

SOLVENCY AND LIQUIDITYThe committee monitors the solvency and liquidity of the group

and company in conjunction with the board and was satisfied

that the group and company remained solvent and liquid.

RISK MANAGEMENT Management determines the key risk areas faced by the group

and recommends and implements mitigation measures.

The committee has reviewed the risk register and mitigating

actions planned by management and ensures that management

provides feedback thereon on a regular basis.

The committee considered the risk matrix and has nothing

material to report. See pages 55 to 57 for more detail.

APPROVAL OF THE INTEGRATED ANNUAL REPORTFollowing our review, and having regard to all material

factors and risks that may impact the integrity of the

Integrated Annual Report, we accordingly recommend

the Integrated Annual Report and group annual financial

statements for the period ended 31 March 2016 to the board of

directors for approval on 13 September 2016.

NDUMI MEDUPEAUDIT AND RISK COMMITTEE CHAIRMAN 13 September 2016


201675

DIRECTORS’ REPORTfor the period ended 31 March 2016

The directors present the annual report, which forms part of the financial statements of the group for the period ended 31 March 2016.

1. REVIEW OF ACTIVITIES The operations in the group mainly comprise the following, and it operates principally in South Africa:

The group develops, produces, distributes and integrates niche world class technologies-driven engineering solutions for harsh

environments within our market segments. Ansys is active in the rail, defence and information security, mining and industrial,

and telecommunications segments.

The operating results and state of affairs of the group and company are fully set out in the attached financial statements and

do not in our opinion require any further comment. Net profit of the group was R19,974 million (2015: R10,025 million), after

taxation of R8,529 million (2015: R4,302 million).

During the past financial period, Ansys Limited concluded the acquisition of the Parsec group (refer note 32) and successfully

incorporated them into the group’s existing operations. The group also changed its financial year-end from 28 February to

31 March.

2. SHARE CAPITAL During the period under review, various share issues took place. During April 2015, 47 778 889 shares were issued in terms

of a general issue to various investors. During July 2015, another 145 718 001 ordinary shares were issued as part of the

purchase consideration for the Parsec group acquisition. Lasty, the Tedaka Investments Proprietary Limited loan was repaid with

the issue of 22 674 375 shares during July 2015.

The company’s authorised share capital remained unchanged at 1 725 490 196 shares (2015: unchanged).

3. DIVIDENDS No dividends were declared or paid to the shareholders during the year (2015: none).

4. BORROWING LIMITATIONS In terms of the memorandum of incorporation of the company, the directors may exercise all the powers of the company to

borrow money, as they consider appropriate.

5. MATERIAL EVENTS AFTER YEAR-END No event which is material to the financial affairs of the group and company has occurred between the balance sheet date and

the date of the approval of the financial statements.

6. DIRECTORS’ INTEREST IN STATED CAPITAL AND CONTRACTS At 31 March 2016, the directors in aggregate, were directly or indirectly beneficially interested in 194 481 040 ordinary shares

(2015: 125 283 622), equivalent to 42,18% (2015: 51,16%) of the issued ordinary shares of Ansys Limited. There were no changes in

the directors interest in shares since year-end. The directors’ interest in the ordinary issued share capital of the company as at

31 March 2016, is set out in the table below:

March 2016 February 2015Number of shares held

beneficially

Number of shares held

beneficiallyDirect Indirect Direct Indirect

ExecutiveT Daka 45 062 745 102 674 375 45 062 745 80 000 000 AR van der Watt - 21 814 752 – – BC Lamprecht 1 000 000 – – –

Non-executive NS Mjoli-Mncube 220 877 4 000 000 220 877 – CP Bester – 19 708 291 – –

46 283 622 148 197 418 45 283 622 80 000 000


201676

DIRECTORS’ REPORT CONTINUEDfor the period ended 31 March 2016

7. DIRECTORS The directors of the company during the period and at the date of this report are as follows:

Executive • T Daka

• R Grobbelaar (resigned 31 December 2015)

• AR van der Watt (appointed 1 June 2015)

• BC Lamprecht (appointed 1 April 2016)

Non-executive • NS Mjoli-Mncube

• SP Mzimela

• FF Dantile (resigned 9 September 2015)

• CP Bester (appointed 1 June 2015)

• N Medupe (appointed 9 September 2015)

• Dr SJ Khoza (appointed 21 October 2015)

Directors’ remuneration Details of directors’ remuneration are set out in notes 8 and 28 to the financial statements.

Directors’ interests in contracts No material contracts in which directors have an interest were entered into in the current financial year (2015: none).

8. SECRETARY The group’s designated Company Secretary is Fusion Corporate Secretarial Services Proprietary Limited.

9. LIQUIDITY AND SOLVENCY The directors have performed the required liquidity and solvency tests required by the Companies Act of South Africa.

10. GOING CONCERN The financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis

presumes that funds will be available to finance future operations and that the realisation of assets and settlement of liabilities,

contingent obligations and commitments will occur in the ordinary course of business.

The directors have reviewed the group’s budget and cash flow forecasts for the period ended March 2017 which include certain

assumptions about the cash flows from planned and unplanned projects and raising additional funding when required. On this

basis and in light of the group’s current financial position, the directors are satisfied that the group will continue to operate for

the foreseeable future and have therefore adopted the going concern basis in preparing these financial statements.

11. AUDITORS PricewaterhouseCoopers Inc were appointed as auditors for the company during the past financial year. At the AGM, the

shareholders will be requested to reappoint PricewaterhouseCoopers Inc as the independent external auditors of the company

and to confirm the partner’s name as the designated lead audit partner for the 2017 financial year.

12. SPECIAL RESOLUTIONS The following special resolutions were passed on 9 September 2015 at the annual general meeting:

– Authority for the company to repurchase its own shares;

– Remuneration of non-executive directors;

– Financial assistance, as amended, in terms of section 44 and section 45 of the Companies Act.


201677

REPORT ON THE FINANCIAL STATEMENTSWe have audited the consolidated and separate financial statements of Ansys Limited set out on pages 78 to 123, which comprise

the statements of financial position as at 31 March 2016, and the statements of comprehensive income, statements of changes

in equity and statements of cash flows for the thirteen months then ended, and the notes, comprising a summary of significant

accounting policies and other explanatory information.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL STATEMENTS The directors are responsible for the preparation and fair presentation of these consolidated and separate financial statements

in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa, and

for such internal control as the directors determine is necessary to enable the preparation of consolidated and separate financial

statements that are free from material misstatements, whether due to fraud or error.

AUDITOR’S RESPONSIBILITYOur responsibility is to express an opinion on these consolidated and separate 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 about whether the consolidated and separate

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, the consolidated and separate financial statements present fairly, in all material respects, the consolidated and

separate financial position of Ansys Limited as at 31 March 2016, and its consolidated and separate financial performance and its

consolidated and separate cash flows for the thirteen months then ended in accordance with International Financial Reporting

Standards and the requirements of the Companies Act of South Africa.

OTHER REPORTS REQUIRED BY THE COMPANIES ACT As part of our audit of the financial statements for the thirteen months ended 31 March 2016, we have read the Directors’ Report,

the Audit Committee’s Report and the Company Secretary’s Certificate for the purpose of identifying whether there are material

inconsistencies between these reports and the audited financial statements. These reports are the responsibility of the preparers.

Based on reading these reports we have not identified material inconsistencies between these reports and the audited financial

statements. However, we have not audited these reports and accordingly do not express an opinion on these reports.

REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTSIn terms of the IRBA Rule published in Government Gazette Number 39475 dated 4 December 2015, we report that

PricewaterhouseCoopers Inc. has been the auditor of Ansys Limited since September 2015.

PRICEWATERHOUSECOOPERS INC. DIRECTOR: P POPE Registered Auditor

Johannesburg

29 September 2016

INDEPENDENT AUDITOR’S REPORT TO THE SHAREHOLDERS OF ANSYS LIMITED AND ITS SUBSIDIARIES


201678

STATEMENTS OF FINANCIAL POSITIONas at 31 March 2016

GROUP COMPANY31 March 28 February 31 March 28 February

2016 2015 2016 2015Notes R’000 R’000 R’000 R’000

ASSETSNon–current assets 175 492 27 091 178 715 38 677

Property, plant and equipment 12 43 053 1 716 1 429 744 Intangible assets 13 120 418 16 869 1 027 1 767 Investments in subsidiaries 14 – – 161 354 27 209 Related party loans 21 – – 9 070 1 701 Deferred tax assets 15 12 021 8 506 5 835 7 256

Current assets 249 489 124 739 71 636 69 422

Inventories 16 84 774 40 533 30 017 19 503 Trade and other receivables 17 121 682 64 816 40 690 46 884 Other financial assets 18 675 – – – Cash and cash equivalents 19 42 358 19 390 929 3 035

Total assets 424 981 151 830 250 351 108 099

EQUITY AND LIABILITIESCapital and reserves 201 271 42 433 193 441 49 456

Share capital 20 212 141 73 668 212 141 73 668 Accumulated loss (11 224) (31 235) (18 700) (24 212)Minority interest 354 – – –

Non–current liabilities 48 887 10 496 8 633 1 121

Related party loans 21 – 9 070 – – Interest bearing borrowings 22 32 509 532 702 293 Other financial liabilities 23 6 372 – 6 372 – Deferred tax liabilities 15 10 006 894 1 559 828

Current liabilities 174 823 98 901 48 277 57 522

Related party loans 21 – 5 998 8 809 9 925 Current portion of interest bearing borrowings 22 2 703 350 356 153 Other financial liabilities 23 2 070 – 2 070 – Trade and other payables 24 152 382 89 938 25 864 45 164 Bank overdrafts 19 14 705 – 9 675 – Current income tax liability 25 1 460 335 – – Provisions 26 1 503 2 280 1 503 2 280

Total equity and liabilities 424 981 151 830 250 351 108 099


201679

STATEMENTS OF COMPREHENSIVE INCOMEfor the period ended 31 March 2016

GROUP COMPANY13 months

ended12 months

ended13 months

ended12 months

ended31 March 28 February 31 March 28 February

2016 2015 2016 2015Notes R’000 R’000 R’000 R’000

Revenue 4 474 066 251 121 140 889 106 215 Cost of sales 5, 7 (351 054) (187 916) (101 143) (71 519)

Gross profit 123 012 63 205 39 746 34 696 Other income 6 703 361 1 416 14 584 Other (losses)/gains 9 (2 719) 3 102 (1 852) (1 986)Administrative and operating expenses 7 (88 917) (50 532) (31 258) (29 574)

Operating profit 32 079 16 135 8 052 17 720 Finance income 10 1 419 34 751 532Finance costs 10 (4 996) (1 842) (1 139) (1 161)

Profit before tax 28 502 14 327 7 664 17 091 Taxation 11 (8 529) (4 302) (2 152) (2 383)

Net profit for the period/year 19 974 10 025 5 512 14 708 Other comprehensive income for the period/year – – – –Total comprehensive income for the period/year 19 974 10 025 5 512 14 708

Attributable to:Owners of the parent 20 010 10 025 5 512 14 708 Minority interest (36) – – –

Earnings per share (cents):Basic and diluted earnings 30 4,86 4,09


201680

STATEMENTS OF CHANGES IN EQUITYfor the period ended 31 March 2016


2016 2015 2016 2015Notes R’000 R’000 R’000 R’000

Ordinary sharesBalance at beginning of the period/year 73 668 73 668 73 668 73 668 Shares issued 26 270 – 26 270 – Business combination 32 112 203 – 112 203 –

Balance at end of the period/year 20 212 141 73 668 212 141 73 668

Accumulated lossBalance at beginning of the period/year (31 234) (41 260) (24 212) (38 920)Total comprehensive income for the period/year 20 010 10 025 5 512 14 708

Balance at end of the period/year (11 224) (31 235) (18 700) (24 212)

Minority InterestBalance at beginning of the period/year – – – – Business combination 32 390 – – – Total comprehensive loss for the period/year (36) – – –

Balance at end of the period/year 354 – – –

201 271 42 433 193 441 49 456


201681


ended12 months

ended13 months

ended12 months


2016 2015 2016 2015Notes R’000 R’000 R’000 R’000

Cash flows from operating activitiesCash receipts from customers 445 616 231 106 148 387 65 128 Cash paid to suppliers and employees (468 638) (206 849) (163 556) (60 886)

Cash generated from/(utilised in) operations 27 (23 022) 24 256 (15 169) 4 242Interest paid 10 (4 995) (1 842) (1 139) (1 161)Interest received 10 1 419 34 751 532 Taxation paid 25 (7 196) – – –

Net cash flow (utilised in)/generated from

operating activities (33 795) 22 449 (15 557) 3 613

Cash flows from investing activitiesPurchase of property, plant and equipment 12 (4 688) (382) (1 123) (203)Proceeds from disposal of property, plant

and equipment 81 2 18 15 Cash payment for acquisition of subsidiary

net of cash acquired 32 7 281 – (13 500) – Increase in intangible assets 13 (1 430) (263) (16) (203)Increase in other financial assets 18 (330) – – – (Increase)/decrease in related party loans 21 – – 1 701 6 459

Net cash flow (utilised in)/generated from

investing activities 914 (643) (12 921) 6 068

Cash flows from financing activitiesIssue of share capital 20 17 200 – 17 200 –(Decrease)/increase in related party loans 21 (5 998) 5 075 (1 116) 1 116 Increase in interest bearing borrowings 22 29 940 (277) 613 (97)

Net cash flow generated from financing activities 41 143 4 798 16 696 1 019

Net (decrease)/increase in cash, cash equivalents and bank overdrafts 8 263 26 604 (11 781) 10 700 Cash, cash equivalents and bank overdrafts at

beginning of the period/year 19 390 (7 214) 3 035 (7 665)

Cash, cash equivalents and bank overdrafts at end of the period/year 19 27 653 19 390 (8 746) 3 035

STATEMENTS OF CASH FLOWSfor the period ended 31 March 2016


201682

1. ACCOUNTING POLICIES The principal accounting policies applied in the preparation of these financial statements are set out below. These accounting policies are consistent with the previous years.

1.1 Basis of preparation The consolidated and seperate annual financial statements have been prepared in accordance with International Financial

Reporting Standards (“IFRS”), the JSE Listings Requirements and the Companies Act of South Africa. The financial statements have been prepared under the historical cost convention, on a going concern basis, and presented in South African Rand (rounded to the nearest R’000), which is the group’s functional currency.

1.1.1 New and amended standards adopted by the group

Effective date

Amendment to IAS 16, ‘Property, plant and equipment’, and IAS 38, ‘Intangible assets’ 1 July 2014

Amendment to IAS 24, ‘Related party disclosures’ 1 July 2014

Amendment to IFRS 13, ‘Fair value measurement’ 1 July 2014

Amendment to IAS 40, ‘Investment property’ 1 July 2014

Amendment to IFRS 8, 'Operating segments' 1 July 2014

The new and amended standards mentioned above did not have any material impact on the financial statements of the company.

1.1.2 New standards, amendments and interpretations issued but not effective for the current financial year and not early adopted

Effective date

Amendment to IFRS 11 ‘Joint arrangements’ on acquisition of an interest in a joint operation 1 January 2016

Amendments to IAS 1 ’Presentation of financial statements’ disclosure initiative 1 January 2016

Amendments to IAS 16

and IAS 38

‘Property, plant and equipment’ and

’Intangible assets’, on depreciation and amortisation

1 January 2016

Amendment to IAS 12 ‘Income taxes’ 1 January 2017

Amendment to IAS 7 ‘Cash flows statements’ 1 January 2017

IFRS 15 ‘Revenue from contracts with customers’ 1 January 2018

IFRS 9 ‘Financial instruments’ (2009 and 2010)

– Financial liabilities

– Derecognition of financial instruments

– Financial assets

– General hedge accounting

1 January 2018

Amendment to IFRS 9 ’Financial instruments’, on general hedge accounting 1 January 2018

IFRS 16 ‘Leases’ 1 January 2019

Amendment to IFRS 7 ‘Financial instruments: Disclosures’ 1 January 2016

Amendment to IAS 34 ‘Interim financial reporting’ 1 January 2016

Management is still investigating the impact and effect of the new and amended standards mentioned above.

1.2 Property, plant and equipment The cost of an item of property, plant and equipment is recognised as an asset when:– it is probable that future economic benefits associated with the item will flow to the company; and– the cost of the item can be measured reliably.

Property, plant and equipment are tangible assets which the company holds for its own use or for rental to others and which are expected to be used for more than one year.

NOTES TO THE ANNUAL FINANCIAL STATEMENTSfor the period ended 31 March 2016


201683

Property, plant and equipment are stated at historical cost less any accumulated depreciation and any accumulated

impairment losses. Cost includes costs incurred initially to acquire or construct an item of property, plant and equipment

(including directly attributable costs in bringing the asset to its location and condition necessary for it to be capable of

operating in the manner that management intended) and costs incurred subsequently to add to, replace part of, or service it

to the extent it is probable that future economic benefits will flow to the group and the cost can be measured reliably. Day-

to-day servicing costs are expensed. If a replacement part is recognised in the carrying amount of an item of property, plant

and equipment, the replaced part is derecognised.

The carrying values of property, plant and equipment are reviewed when events or changes in circumstances indicate that

the carrying value may not be recoverable. If any such indication exists and where the carrying value exceeds the estimated

recoverable amount, the assets or cash-generating units are written down to their recoverable amount.

Depreciation of an asset commences when the asset is available for use as intended by management. Each part of an item of

property, plant and equipment with a cost that is significant in relation to the total cost of the item is depreciated separately.

Depreciation is charged so as to write off the cost of assets less their residual values over their estimated useful lives, using

the straight-line method. Land is not depreciated. The asset’s residual values and useful lives are reviewed, and adjusted,

if appropriate, at each balance sheet date. If the expectations differ from previous estimates, the changes are accounted for

as a change in accounting estimate. Depreciation is not charged to an asset if its estimated residual value exceeds or is equal

to its carrying amount. Depreciation of an asset ceases at the earlier of the date that the asset is classified as held for sale or

derecognised.

The estimated useful lives of the major categories of property, plant and equipment are:

Office equipment 4 - 7 years Manufacturing equipment 4 - 17 years

Computer equipment 3 years Tools and laboratory equipment 3 - 18 years

Furniture and fittings 6 years Motor vehicles 5 - 7 years

Buildings 20 years Leasehold improvements 3 - 16 years

Plant and machinery 5 - 10 years Electronic equipment 3 - 16 years

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

from its continued use or disposal. The gain or loss arising on the disposal or retirement of an item of property, plant

and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is

recognised in profit or loss when the item is derecognised.

1.3 Trade receivables Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective

interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is

objective evidence that the group will not be able to collect all amounts due according to the original terms of receivables.

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 receivable is 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 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 statement of comprehensive income within administrative and

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 other income in the statement of comprehensive income.

Trade and other receivables are classified as loans and receivables. If collection is expected in one year or less (or in the

normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as

non-current assets.

1. ACCOUNTING POLICIES CONTINUED1.2 Property, plant and equipment continued


201684

1.4 Cash and cash equivalents Cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid investments with original maturities of three months or less and bank overdrafts that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value. These are initially and subsequently recorded at fair value.

1.5 Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the group’s share of the net identifiable assets of the acquired business at the date of acquisition. Goodwill on acquisitions of business is included in intangible assets. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. Impairment losses are not reversed. Gains and losses on the disposal of a business include the carrying amount of goodwill relating to the business sold.

Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units that are expected to benefit from the business combination in which the goodwill arose.

1.6 Leases A 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 al the risk and rewards incidental to ownership.

Finance leases – lessee

Finance leases are recognised as assets in the statement of financial position at amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. The discount rate used in calculating the present value of the minimum lease payments is the interest rate implicit in the lease/group’s incremental borrowing rate.

The lease 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 of interest on the remaining balance of the liability.

Operating leases – lessee

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 is recognised as an operating lease liability. This liability is not discounted. Any contingent rents are expensed in the period they are incurred.

1.7 Inventories and work in progress Inventories are stated at the lower of cost or net realisable value. Cost is determined by the weighted average method. The cost of finished goods and work in progress comprises raw materials, direct labour and other direct costs but excludes interest expenses. Net realisable value is the estimate of the selling price in the ordinary course of business, less applicable variable selling expenses. The cost of inventories that are not ordinarily interchangeable and goods or services produced and segregated for specific projects is assigned using specific identification of the individual costs.

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.

1.8 Share capital Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction, net of tax, from the proceeds.

1.9 Revenue recognition Revenue comprises the fair value of the consideration received or receivable in the ordinary course of the group’s activities for sale of goods and services net of value-added tax, estimated returns, rebates, and discounts.

NOTES TO THE ANNUAL FINANCIAL STATEMENTS CONTINUEDfor the period ended 31 March 2016

1. ACCOUNTING POLICIES CONTINUED


201685

Revenue from the sale of goods is recognised when:• the group has transferred to the buyer the significant risks and rewards of ownership of the goods; • the group retains neither continuing managerial involvement to the degree usually associated with ownership nor

effective control over the goods sold;• the amount of revenue can be measured reliably;• it is probable that the economic benefits associated with the transaction will flow to the group; and• the costs incurred or to be incurred in respect of the transaction can be measured reliably.

When the outcome of a transaction involving the rendering of services can be estimated reliably, revenue associated with the transaction is recognised by reference to the stage of completion of the transaction at the end of the reporting period. The outcome of a transaction can be estimated reliably when all the following conditions are satisfied:• The amount of revenue can be measured reliably;• It is probable that the economic benefits associated with the transaction will flow to the group;• The stage of completion of the transaction at the end of the reporting period can be measured reliably; and• The costs incurred for the transaction and the costs to complete the transaction can be measured reliably.

When the outcome of the transaction involving the rendering of services cannot be estimated reliably, revenue shall be recognised only to the extent of the expenses recognised that are recoverable. When it is probable that total project cost will exeed total contract revenue, the expected loss is recognised as an expense immediately.

Service revenue is recognised by reference to the stage of completion of the transaction at the end of the reporting period. Stage of completion is determined by reference to costs incurred to date as a percentage of total expected costs to be incurred. When the stage of completion differs from the actual invoicing at financial year- end, it is recognised as project receivable in trade and other receivables or billings in excess of earnings in trade and other payables, as appropriate.

Contract revenue comprises:• the initial amount of revenue agreed in the contract; and• variations in contract work, claims and incentive payments: – to the extent that it is probable that they will result in revenue; and – they are capable of being reliably measured.

When loans and receivables are impaired, the group reduces the carrying amount to its recoverable amount, being the estimated future cash flows discount at the original effective interest of the instrument, and continued unwinding the discount as interest income. Interest income on impaired loans and receivables is recognised using the effective interest rate.

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

Dividends are recognised, in profit or loss, when the company’s right to receive payment has been established.

Maintenance fees for products are recognised over the period relating to the contractual maintenance period.

1.10 Cost of sales 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. The related cost of providing services recognised as revenue in the current period is included in cost of sales.

Contract costs comprise:• costs that relate directly to the specific contract;• costs that are attributable to contract activity in general and can be allocated to the contract; and• such other costs as are specifically chargeable to the customer under the terms of the contract.

1. ACCOUNTING POLICIES CONTINUED1.9 Revenue recognition continued


201686

1.11 Current and deferred income tax Income tax expense The tax expense for the year comprises current and deferred tax. Current and deferred taxes are recognised as income or an expense and included in profit or loss for the period, except to the extent that the tax arises from:• a transaction or event which is recognised, in the same or a different period, to other comprehensive income; or• a business combination.

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

Current income tax The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance sheet date. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Current income tax for current and prior years is, to the extent unpaid, recognised as a liability. If the amount already paid in respect of current and prior years exceeds the amount due for those years, the excess is recognised as an asset.

Deferred income tax Deferred income tax is provided, using the liability method, for all temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes. However, the deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised, for the carry forward of unused tax losses, to the extent that it is probable that future taxable profits will be available, against which the temporary differences can be utilised.

1.12 Financial instruments Classification The group classifies financial assets and financial liabilities into the following categories:• Financial assets at fair value through profit or loss – held for trading;• Loans and receivables; and• Financial liabilities measured at amortised cost.

Classification depends on the purpose for which the financial instruments were obtained/incurred and takes place at initial recognition. Classification is re-assessed on an annual basis, except for derivatives and financial assets designated as at fair value through profit or loss, which shall not be classified out of the fair value through profit or loss category.

No other reclassifications may be made into or out of the fair value through profit or loss category.

Initial recognition and measurement Financial instruments are recognised initially when the group becomes a party to the contractual provisions of the instruments. 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.

For financial instruments which are not at fair value through profit or loss, transaction costs are included in the initial measurement of the instrument. Transaction costs on financial instruments at fair value through profit or loss are recognised in profit or loss.

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. Financial assets carried at fair value through profit or loss are initially recognised at fair value,




201687

and transaction costs are expensed in the income statement. Financial assets are derecognised when the rights to receive cash flows from the assets have expired or have been transferred and the group has transferred substantially all risks and rewards of ownership. Financial assets at fair value through profit or loss are subsequently carried at fair value. Loans and receivables are subsequently carried at amortised cost using the effective interest method.

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 within‘ other (losses)/gains – net’ in the period in which they arise.

Derecognition Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the group has transferred substantially all risks and rewards of ownership.

Fair value determination If the market for a financial asset is not active, the group establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis, and option pricing models making maximum use of market inputs and relying as little as possible on entity-specific inputs.

Impairment of financial assets At each reporting date the group assesses all financial assets, other than those at fair value through profit or loss, to determine whether there is objective evidence that a financial asset or group of financial assets has been impaired. For amounts due to the group, significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy and default of payments are all considered indicators of impairment.

Impairment losses are recognised in profit or loss. Impairment losses are reversed when an increase in the financial asset’s recoverable amount can be related objectively to an event occurring after the impairment was recognised, subject to the restriction that the carrying amount of the financial asset at the date that the impairment is reversed shall not exceed what the carrying amount would have been had the impairment not been recognised. Reversals of impairment losses are recognised in profit or loss.

Where financial assets are impaired through use of an allowance account, the amount of the loss is recognised in profit or loss within operating expenses. When such assets are written off, the write-off is made against the relevant allowance account. Subsequent recoveries of amounts previously written off are credited against operating expenses.

1.13 Foreign currencies Functional and presentation currency Items included in the financial statements of the group are measured using the currency of the primary economic environment in which the group operates (‘the functional currency’).

Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the date of the transactions. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies, are recognised in the statement of comprehensive income.

At the end of the reporting period:• foreign currency monetary items are translated using the closing rate; • non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange

rate at the date of the transaction; and• non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the

date when the fair value was determined.

Cash flows arising from transactions in a foreign currency are recorded in Rands by applying to the foreign currency amount

the exchange rate between the Rand and the foreign currency at the date of the cash flow.

1. ACCOUNTING POLICIES CONTINUED1.12 Financial instruments continued

Initial recognition and measurement continued


201688

1.14 Provisions Provisions are recognised when the group has a present legal or constructive obligation as a result of past events, it is

probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount of the

obligation can be made.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined

by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect

to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a

pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the obligation.

The increase in the provision due to passage of time is recognised as interest expense.

1.15 Earnings in excess of billings/billings in excess of earnings The value of earnings in excess of billings comprises the selling price for services rendered up to and including reporting

date, which cannot be invoiced at this date due to contractual milestones not yet reached. The value is calculated based

on the percentage of completion method for fixed price development contracts. The value is stated at selling price less

provision for impairment, if any.

The value of billings in excess of earnings comprises the excess of invoice values over the selling price for services rendered

recognised up to and including reporting date. The value is calculated based on the percentage of completion method for

fixed price development contracts. The value is stated at selling price less provision for impairment, if any.

1.16 Impairment of non-financial assets Assets that are subject to depreciation and amortisation are reviewed for impairment whenever events or changes in

circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised immediately in

profit or loss for the amount by which the carrying amount of the asset exceeds its recoverable amount, which is the higher

of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped

at the lowest level for which there are separately identifiable cash flows. Non-financial assets other than goodwill that

suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

If there is any indication that an asset may be impaired, the recoverable amount is estimated for 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 a cash-generating unit is the higher of its

fair value less costs to sell and its value in use.

Goodwill acquired in a business combination is, from the acquisition date, allocated to each of the cash-generating units, or

groups of cash-generating units, that are expected to benefit from the synergies of the combination, irrespective of whether

other assets or liabilities of the acquiree are assigned to those units or groups of units.

Each unit or group of units to which the goodwill is so allocated represents the lowest level within the entity at which

the goodwill is monitored for internal management purposes, and is not larger than an operating segment as defined by

paragraph 5 of IFRS 8, ‘Operating segments’ before aggregation.

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.

An entity assesses at each reporting date whether there is any indication that an impairment loss recognised in prior

periods for assets other than goodwill may no longer exist or may have decreased. If any such indication exists, the

recoverable amounts of those assets are estimated.




201689

The increased carrying amount of an asset other than goodwill attributable to a reversal of an impairment loss does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior periods. A reversal of an impairment loss of assets carried at cost less accumulated depreciation or amortisation other than goodwill is recognised immediately in profit or loss.

1.17 Bank overdrafts and borrowings Bank overdrafts and borrowings are recognised initially at fair value, net of transaction costs incurred. Bank overdrafts and borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the statement of comprehensive income over the period of the borrowings using the effective interest method.

Bank overdrafts and borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least 12 months after the statement of financial position date.

1.18 Employee benefits

Pension obligations The group has a defined contribution plan. A defined contribution plan is a pension plan under which the group pays fixed contributions into a separate entity. The group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior years.

For defined contribution plans, the group pays contributions to publicly or privately administered pension insurance plans on a mandatory basis. The group has no further payment obligations once the contributions have been paid. The contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments are available.

Bonus plans The group recognises a liability and an expense for bonuses based on a formula that takes into consideration the profit attributable to the group’s shareholders after certain adjustments. The group recognises a provision where contractually obliged or where there is a past practice that has created a constructive obligation.

Short-term employee benefits The costs 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 employees render services that increase 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 or constructive obligation to make such payments as a result of past performance.

1.19 Trade payables Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. If collection is expected in one year or less (or in normal operating cycle of business if longer), they are classified as current liabilities. If not, they are presented as non-current liabilities.

1.20 Dividend distribution Dividend distribution to the company’s shareholders is recognised as a liability in the financial statements in the year in which the dividends are approved by the company’s directors.

1.21 Consolidation – subsidiariesSubsidiaries are all entities (including structured entities) over which the group has control. The group controls an entity when the group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power to direct the activities of the 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 acquisition method of accounting is used to account for business combinations by the group.

1. ACCOUNTING POLICIES CONTINUED1.16 Impairment of non-financial assets continued


201690

Intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated.

Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset.

Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by

the group.

Non-controlling interests in the results and equity of subsidiaries are shown separately in the consolidated statement of

profit or loss, statement of comprehensive income, statement of changes in equity and balance sheet respectively.

Change in ownership interests

The group treats transactions with non-controlling interests that do not result in a loss of control as transactions with

equity owners of the group. A change in ownership interest results in an adjustment between the carrying amounts of the

controlling and non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the

amount of the adjustment to non-controlling interests and any consideration paid or received is recognised in a separate

reserve within equity attributable to owners of the company.

1.22 Investment in subsidiaries

Investments in subsidiaries are carried at cost less any accumulated impairment in the company’s separate financial

statements. The cost of an investment in a subsidiary is the aggregate of:

• the fair value, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by

the group; plus

• any costs directly attributable to the purchase of the subsidiary.

1.23 Earnings per share

The company presents basic earnings per share (“EPS”) for its ordinary shares. Basic EPS is calculated by dividing the profit or

loss attributable to ordinary shareholders of the company by the weighted average number of ordinary shares outstanding

during the period. Headline earnings per ordinary share are calculated using the weighted average number of ordinary shares

in issue during the period and are based on the earnings attributable to ordinary shareholders, after excluding those items as

required by Circular 2/2013 issued by the South African Institute of Chartered Accountants (“SAICA”).

1.24 Intangible assets

An intangible asset is recognised when:

• it is probable that the expected future economic benefits that are attributable to the asset will flow to the entity; and

• the cost of the asset can be measured reliably.

Intangible assets are carried at cost less any accumulated amortisation and any impairment losses. The amortisation period

and the amortisation method for intangible assets are reviewed at every period-end.

An intangible asset arising from internal developments (or from the development phase of an internal project) is

recognised when:

• it is technically feasible to complete the asset so that it will be available for use or sale;

• there is an intention to complete and use or sell it;

• there is an ability to use or sell it;

• it will generate probable future economic benefits;

• there are available technical, financial and other resources to complete the development and to use or sell the asset; and

• the expenditure attributable to the asset during its development can be measured reliably.

Expenditure on research (or on the research phase of an internal project) is recognised as an expense when it is incurred.

1. ACCOUNTING POLICIES CONTINUED1.21 Consolidation – subsidiaries continued



201691

Intangible assets include the following:

Externally acquired computer software

Costs associated with the maintaining of externally acquired computer software are recognised as an expense.

Costs of externally acquired computer software products recognised as intangible assets are amortised over their useful

lives (not exceeding two years).

Internally generated intangible assets

Costs associated with the maintaining of internally generated intangible assets are recognised as an expense. Costs that are

directly associated with the development or enhancement of identifiable and unique products or features that is under the

control of the group and that will probably generate economic benefits exceeding costs beyond one year are recognised as

intangible assets. Costs include the employee costs incurred as a result of developing the products, an appropriate portion

of relevant overheads as well as any hardware utilised in the development process.

Development costs on internally generated intangible assets are amortised over their useful lives.

Intangible assets identified as part of business combination

As part of the Purchase Price Allocation of business combination transactions (IFRS 3) certain intangible assets may be

identified and recognised at the date of acquisition. These assets are amortised over the amortisation periods as per below.

Amortisation period

Externally acquired

Computer software 2 years

Internally generated (development cost)

Rail products 2 years

Defence and Information security products 5 -7 years

Mining and industrial products 2-7 years

Telecommunications products 3-5 years

Intangible assets identified as part of business combination

Brand 5 years

Customer relationships 5 years

1.25 Segment reporting

The segment information has been prepared in accordance with IFRS 8, ‘Operating segments’, which requires disclosure of

financial information of an entity’s operating segments.

Operating segments are reported in a manner consistent with the internal reporting provided 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 steering committee that makes strategic decisions.

A segment is a distinguishable component of the group engaged in providing products or services within a particular

economic environment, which is subject to risks and rewards that are different from those of other segments.

All intersegment transactions are eliminated.

The group operates within four operating segments and its principal activities are:

(a) Rail

(b) Mining and Industrial

(c) Defence and Information security

(d) Telecoms

1. ACCOUNTING POLICIES CONTINUED1.24 Intangible assets continued


201692

2. FINANCIAL RISK MANAGEMENT 2.1 Financial risk factors

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 unpredictability of financial markets and seeks to minimise potential adverse effects on

the group’s financial performance.

Risk management is carried out by the board of directors.

(a) Market risk

(i) Foreign exchange risk

The group operates internationally and is exposed to foreign exchange risk arising from various currency exposures,

primarily with respect to the US Dollar and European Euro. Foreign exchange risk arises from future commercial

transactions as well as recognised assets and liabilities.

Foreign exchange risk arises when future commercial transactions or recognised assets or liabilities are denominated in a

currency that is not the entity’s functional currency.

Management uses Forward Exchange Contracts (“FECs”) and futures and option contracts to hedge certain foreign currency

liabilities when and where applicable to manage the exchange risk on these transactions. This is consistent with the method

used in prior years.

As at 31 March 2016, if the Rand had weakened by 6% against the US Dollar, European Euro and British Pound with all other

variables held constant, pre-tax profit would have been R4 663 779 lower (February 2015: if Rand weakened by 3% pre-tax

profit would be R1 438 556 lower), mainly as a result of foreign exchange gains on translation of foreign-denominated trade

receivables, trade payables and cash and cash equivalents. Profit has been as sensitive as in the prior year to movements in

the exchange rates, due to the fact that the composition of foreign-denominated trade receivables, trade payables and cash

and cash equivalents as at the end of the two financial years has remained fairly consistent. Equity was not sensitive to

exchange rate fluctuations other than through profit and loss as per above. This is due to the fact that there are no equity-

denominated securities denominated in foreign currency. The largest foreign currency exposures at the end of the reporting

period as follows:

2016 2015

Current assets Trade debtors (USD debtors) $223 211 $6 169 Cash (USD bank accounts) $296 967 $–

Liabilities Trade creditors (USD creditors) $985 921 $763 665 Trade creditors (EUR creditors) €4 191 570 €2 952 264

Exchange rates used for conversion of foreign items above were:USD 14,88 12,20EUR 16,89 13,11



201693

Open foreign exchange contracts which relate to future commitments are as follows:

Amount in foreign currencyNumber

of contractsFuture

contract rate

Fair valuetranslation

rateMaturity

date

2016Future contractsEUR 451 18,398 17,045 30 June 2016EUR 226 17,455 17,045 30 June 2016EUR 200 18,006 17,435 30 September 2016EUR 150 17,438 17,435 30 September 2016EUR 50 17,438 17,435 30 September 2016USD 18 16,450 14,928 30 June 2016USD 100 16,254 14,928 30 June 2016USD 285 15,660 14,928 30 June 2016

Option contractsEUR 300 000 18,500 4 April 2016EUR 500 000 18,545 15 April 2016EUR 315 643 18,634 6 May 2016EUR 700 000 18,295 20 May 2016EUR 714 762 18,380 10 June 2016

2015Future contractsUSD 154 11,797 11,696 31 March 2015USD 226 11,494 11,696 30 June 2015

(ii) Price risk

The group is not exposed to equity securities or commodity price risk.

(iii) Cash flow and fair value interest rate risk

As the group has interest bearing assets and liabilities, the group’s income and operating cash flows are partly dependent

on changes in market rates. The group’s interest rate risk arises from long-term borrowings, related party loans as

well as cash and cash equivalents. Borrowings issued at variable rates expose the group to cash flow interest rate risk.

During March 2016 and 2015, the group’s borrowings at variable rates were only denominated in South African Rand.

The group analyses its interest rate exposure on a dynamic basis. Various scenarios are simulated taking into consideration

refinancing, renewal of existing positions, alternative financing and possible hedging. Based on the scenarios, the group

calculates the impact on profit and loss of a defined interest rate shift. The scenarios are run only for liabilities that

represent the major interest bearing positions.

As at 31 March 2016, if interest rates on South African Rand-denominated borrowings at that date had been 100 basis

points higher with all other variables held constant, pre-tax profit would have been R363 147 lower due to the net increase

in interest earned on bank deposits and paid on borrowings. In February 2015 the pre-tax profit would have been R198 136

lower if there were a 100 basis points increase in the net interest earned on bank deposits and paid on borrowings for that

financial year.

2. FINANCIAL RISK MANAGEMENT CONTINUED2.1 Financial risk factors continued

(a) Market risk continued


201694

(b) Credit risk

Credit risk is managed on a group basis. Credit risk arises from cash and cash equivalents, deposits with banks and financial

institutions as well as credit exposures to large customers, including outstanding receivables and committed transactions.

For banks and financial institutions, only the big four banks in South Africa are accepted. If customers are independently

rated, these ratings are used. Otherwise, if there is no independent rating, 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 or external ratings in accordance with limits set by management.

The group may request certain customers to provide independent reputable bank guarantees, or advance payments, as

collateral against credit risk, in respect of contracts concluded. The objective of such collateral is to counter the risk of non-

payment by the group’s contract debtors. This process is followed by the group as far as possible to manage the credit risk

before credit is granted to the customers on projects.

Financial assets that are past due but not impaired, are high credit quality with a historical group default rate of 0%

(2015: 0%) and company default rate of 0% (2015: 0%). The historic default rate is calculated by dividing the actual bad debt

write-off by revenue for the year. Refer to note 17 for more information. The group has some concentration of credit risk

in debtors within specific segments that it operates, especially where there are only a few key players in those segments.

In these cases management assesses the credit quality of the customer taking into account its financial position, past

experience and other factors.

No credit limits were exceeded during the reporting period, and management does not expect any losses from non-

performance by these counterparties.

The credit quality of cash at bank and short term deposits, excluding cash on hand, that are neither past due nor

impaired can be assessed by reference to external credit ratings (if available) or historical information about counterparty

default rates:

GROUP COMPANY

31 March 28 February 31 March 28 February2016 2015 2016 2015

R’000 R’000 R’000 R’000

Credit rating

AA 42 333 19 379 919 3 024

(c) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash and the availability of funding through an adequate

amount of committed credit facilities. The group aims to maintain flexibility in funding by keeping committed credit lines

available.

The table below analyses the group’s financial liabilites that will be settled on a net basis into relevant maturity groupings

based on the remaining period at the balance sheet to the contractual maturity date. The amounts disclosed in the table are

the contractual undiscounted cash flows.




201695

Less than 1 month

Between 1 and 12 months

Between 1 and 5 years

Later than 5 years

R’000 R’000 R’000 R’000

GROUPAt 31 March 2016Bank borrowings 14 705 – – – Trade payables 118 451 – – – Interest bearing borrowings 575 5 738 25 244 22 381 Other financial liabilities – 2 528 9 686 – Billings in excess of earnings and prepayments received 1 881 20 689 – – Other payables 8 136 – –

At 28 February 2015Trade payables 80 888 – – – Interest bearing borrowings 35 386 555 – Billings in excess of earnings and prepayments received 340 3 735 – – Related party loans – 5 998 9 070 –

COMPANYAt 31 March 2016Bank borrowings 9 675 – – – Trade payables 24 368 – – – Interest bearing borrowings 34 379 815 –Other financial liabilities – 2 528 9 686 – Billings in excess of earnings and prepayments received 27 298 – – Other payables 5 – – –Related party loans – 8 809 – –

At 28 February 2015Trade payables 37 001 – – –Interest bearing borrowings 16 174 300 –Billings in excess of earnings and prepayments received 340 3 735 – –Related party loans – 9 925 – –

(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 the shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

The capital structure of the group consists of debt, which includes the borrowings disclosed in notes 21, 22 and 23, cash and cash equivalents disclosed in note 19, and equity as disclosed in the statement of financial position.

In order to maintain or adjust the capital structure, the group may adjust the amount of dividends paid to the shareholders, return capital to the shareholders, issue new shares or sell assets to reduce debt. Consistent with others in the industry, the group monitors capital on the basis of the gearing ratio.

This ratio is calculated as net debt divided by total capital. Net debt is calculated as total ‘borrowings’ (including current and non-current ‘borrowings’ as shown in the statement of financial position) less ‘cash and cash equivalents’. Total capital is calculated as ‘equity’ as shown in the statement of financial position, plus net debt.

2. FINANCIAL RISK MANAGEMENT CONTINUED2.1 Financial risk factors continued (c) Liquidity risk continued


201696

There are no externally imposed capital requirements. There have been no changes to what the entity manages as capital,

the strategy for capital maintenance or externally imposed capital requirements from the previous year.

The gearing ratios at 2016 and 2015 were as follows for the group:

31 March 28 February2016 2015

R’000 R’000

Total borrowingsLoans from related parties – 15 068Interest bearing borrowings 35 212 882 Less: Cash and cash equivalents (27 653) (19 390)

Net debt 7 559 (3 440)Total equity 201 271 42 433

Total capital 208 830 38 993

Gearing ratio 4% (9%)

2.2 Fair value estimation

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques.

The group uses a variety of methods and makes assumptions that are based on market conditions existing at each reporting

date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt. Other techniques, such as

estimated discounted cash flows, are used to determine fair value for the remaining financial instruments. Refer to note 37

for the fair value disclosures.

The nominal value less impairment provision of trade receivables and payables is assumed to approximate their fair values.

The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at

the current market interest rate that is available to the group for similar financial instruments.

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS Estimates and judgements are continually evaluated and are based on historical experience and other factors, including

expectations of future events that are believed to be reasonable under the circumstances.

The group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition,

seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material

adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

3.1 Critical accounting estimates and assumptions

(a) Fair value of financial instruments

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques.

The group uses its judgement to select a variety of methods and makes assumptions that are mainly based on market

conditions existing at each statement of financial position date. Other techniques, such as estimated discounted cash

flows, are used to determine fair value for the remaining financial instruments. The fair value of forward foreign exchange

contracts is determined using quoted forward exchange rates at the end of the reporting period.

The carrying value less impairment provision of trade receivables and payables is assumed to approximate their fair values.

The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at

the current market interest rate that is available to the company for similar financial instruments.


(d) Capital risk management continued



201697

(b) Estimated impairment of goodwill

The group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy stated

in note 1.5. The recoverable amounts of cash-generating units and individual assets have been determined based on the

higher of value-in-use calculations and fair values less costs to sell. These calculations require the use of estimates and

assumptions. It is reasonably possible that the gross margin, growth rate and/or discount rate assumptions may change

which may then impact our estimations and may then require a material adjustment to the carrying value of goodwill and

tangible assets.

The company reviews and tests the carrying value of assets when events or changes in circumstances suggest that the

carrying amount may not be recoverable. In addition, goodwill is tested on an annual basis for impairment. Assets are

grouped at the lowest level for which identifiable cash flows are largely independent of cash flows of other assets and

liabilities. If there are indications that impairment may have occurred, estimates are prepared of expected future cash flows

for each group of assets. Expected future cash flows used to determine the value in use of goodwill and tangible assets

are inherently uncertain and could materially change over time. They are significantly affected by a number of factors

including supply/demand, together with economic factors such as the economic stability of the country of main operations,

fluctuation in exchange rates etc.

(c) Revenue recognition

The group uses the percentage-of-completion method in accounting for its sales of certain services. Use of percentage-

of-completion method requires management to estimate the services performed to date as a proportion of the total

services to be performed. Significant management estimates can have a material effect on the revenue recognition portion

of these contracts.

(d) Intangible assets

The group uses forecasted sales of the internally generated intangible assets products that are developed to determine

if the costs capitalised are recoupable in the foreseeable future. Should it be determined that sales are not deemed to be

enough to recoup the capitalised cost, the asset value is re-assessed and any impairment of the assets is recognised in the

statement of comprehensive income in that particular financial year.

(e) Deferred tax assets

The group uses budgets and financial forecasts of the respective company for the foreseeable future to estimate whether

deferred tax assets are recoverable or not.

(f) Business combination

Management used its judgement in establishing that the business combination transaction with the Parsec group was in

fact a normal acquisition and not a reverse acquisition, after taking into account factors such as the shareholding in the

company after the transaction, number of voting rights on the Board of Directors and the company’s ability to have effective

control over the Parsec group.

3. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS CONTINUED3.1 Critical accounting estimates and assumptions continued


201698

GROUP COMPANY

13 monthsended

12 monthsended

13 monthsended

12 monthsended

31 March 28 February 31 March 28 February2016 2015 2016 2015

R’000 R’000 R’000 R’000

4. REVENUERendering of services 253 341 54 320 118 967 54 320 Sale of goods 220 725 196 801 21 922 51 895

474 066 251 121 140 889 106 215

5. COST OF SALESCost of sale of goods and services 346 636 180 490 101 143 68 904 Write-down of inventories to net realisable value 4 418 7 426 – 2 615

351 054 187 916 101 143 71 519

6. OTHER INCOMEManagement fees – – 1 304 5 797 Sundry income 682 361 112 82 Profit on sale of property, plant and equipment 21 – – 5Reversal of impairment of investment in subsidiary – – – 8 700

703 361 1 416 14 584

7. EXPENSES BY NATUREAdvertising and marketing 3 087 796 1 170 367 Amortisation (note 13) 6 574 1 454 756 1 411 Courier and postage costs 209 121 10 3 Depreciation (note 12) 4 184 747 420 246 Employee benefit expense (note 8) 102 346 46 938 36 757 33 371Entertainment 619 341 179 160 Installation costs 13 802 3 315 13 802 3 315 Insurance 2 486 618 2 039 618 Other expenses 8 926 8 873 6 734 10 389 Professional services 5 122 7 244 2 279 1 447 Project-related travel 1 927 1 139 1 927 1 139 Raw materials and consumables used 282 547 163 037 63 102 46 639 Rent buildings 3 600 3 105 1 828 1 574 Repairs and maintenance expenditure 1 793 150 168 103 Research and development 646 – 646 –Skills Development Levy 816 256 381 256 Travel and accommodation – local 661 299 144 40 Travel and accommodation – overseas 625 16 60 16

Total cost of sales and administrative and operating expenses 439 971 238 448 132 401 101 093

8. EMPLOYEE BENEFIT EXPENSESalaries and wages 87 187 40 949 32 524 27 382Directors’ remuneration (note 28) 15 159 5 989 4 233 5 989

Total employee benefit expense 102 346 46 938 36 757 33 371

Post retirement benefit: defined contribution plan

(included in employee benefits above) 5 845 1 842 1 903 1 340

Number of employees at end of the period/year 257 92 72 59



201699

9. OTHER (LOSSES)/GAINS Financial assets at fair value through profit and loss – held-for-trading:– Fair value gains: unrealised 718 80 380 80– Fair value losses: unrealised – – – –

Foreign exchange gains and losses:– Fair value gains: realised 3 244 5 777 619 364– Fair value losses: realised (3 871) (1 587) (2 851) (1 262)– Fair value losses: unrealised (2 810) – – –Impairment of intangible asset – (1 168) – (1 168)

(2 719) 3 102 (1 852) (1 986)

10. NET FINANCE (COSTS)/INCOMEInterest expense Interest bearing borrowings (2 989) (75) (98) (20) Bank loans and overdrafts (1 676) (1 103) (794) (1 018) Related party loans (247) (648) (180) (116) Other (84) (16) (67) (7)

(4 996) (1 842) (1 139) (1 161)

Interest income Bank 1 419 34 375 26 Related party loans – – 376 506

1 419 34 757 532

(3 577) (1 808) (388) (629)

11. TAXATIONCurrent tax current year 8 513 – – – Current tax prior year understatement – 335 – – Deferred tax current year (42) 3 967 2 152 2 383 Securities transfer tax 58 – – –

8 529 4 302 2 152 2 383

Assessed tax losses available for set-off against future

taxable income 20 796 12 957 17 036 12 957

The tax on the group's profit before tax differs from the theoretical amount that would arise using the basic tax rate of South Africa as follows:

Profit before tax 28 502 14 327 7 664 17 091

Tax calculated at a rate of 28% (2015: 28%) 7 981 4 012 2 146 4 785 Expenses not deductible for tax purposes 149 2 391 6 1 880 Current tax prior year understatement – 335 – –Non-taxable income – (2 436) – (4 282)Other permanent differences 342 – – – Securities transfer tax 58 – – –

Tax charge 8 529 4 302 2 152 2 383


ended12 months

ended13 months

ended12 months


2016 2015 2016 2015R’000 R’000 R’000 R’000


2016100

12. PROPERTY, PLANT AND EQUIPMENTTools and

laborotary Office Motor Computer Electronic Furniture Manufacturing Leasehold Plant and Land andequipment equipment vehicles equipment equipment and fittings equipment improvements machinery buildings Total

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

GROUPPeriod ended 31 March 2016Opening carrying amount 222 6 303 343 36 259 – 113 434 – 1 716 Additions 125 167 1 838 987 14 655 170 46 350 382 4 734 Disposals – – – (42) – (3) – – – – (45)Depreciation charge (397) (397) (492) (624) (26) (698) (1 018) (376) (156) – (4 184)Business combination (note 32) 731 3 391 871 455 – 201 4 676 364 – 30 143 40 832

Closing carrying amount 681 3 167 2 520 1 118 24 414 3 828 148 628 30 525 43 053

At 31 March 2016Cost 4 097 4 411 4 212 5 415 227 3 167 10 986 886 1 256 30 525 65 182Accumulated depreciation (3 416) (1 244) (1 692) (4 297) (203) (2 753) (7 158) (738) (628) – (22 129)

Carrying amount 681 3 167 2 520 1 118 24 414 3 828 148 628 30 525 43 053

Year ended 28 February 2015Opening carrying amount 269 1 440 221 67 400 – 186 – – 1 584 Additions 52 11 – 301 – 37 – 52 474 – 927 Disposals (1) (4) – (4) – – – (39) – – (48)Depreciation charge (98) (2) (137) (175) (31) (178) – (86) (40) – (747)

Closing carrying amount 222 6 303 343 36 259 – 113 434 – 1 716

At 28 February 2015Cost 709 251 2 816 1 557 214 938 – 236 916 – 7 637 Accumulated depreciation (487) (245) (2 513) (1 214) (178) (679) – (123) (482) – (5 921)

Carrying amount 222 6 303 343 36 259 – 113 434 – 1 716

Manufacturing equipment, plant and machinery and motor vehicles with a book value of R6 134 769 (2015: R729 217)

serve as security for instalment sale agreements (note 22).

Details of propertyThe property is situated at 76 Regency Drive, Route 21 Corporate Park, Irene, Gauteng. The property was registered in the Deeds

Office on 27 July 2015. At that date the full property cost was capitalised in the records of Parsec Properties Proprietary Limited.

The property serves as security for the borrowings as per note 22.



2016101

12. PROPERTY, PLANT AND EQUIPMENTTools and

laborotary Office Motor Computer Electronic Furniture Manufacturing Leasehold Plant and Land andequipment equipment vehicles equipment equipment and fittings equipment improvements machinery buildings Total

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

GROUPPeriod ended 31 March 2016Opening carrying amount 222 6 303 343 36 259 – 113 434 – 1 716 Additions 125 167 1 838 987 14 655 170 46 350 382 4 734 Disposals – – – (42) – (3) – – – – (45)Depreciation charge (397) (397) (492) (624) (26) (698) (1 018) (376) (156) – (4 184)Business combination (note 32) 731 3 391 871 455 – 201 4 676 364 – 30 143 40 832

Closing carrying amount 681 3 167 2 520 1 118 24 414 3 828 148 628 30 525 43 053

At 31 March 2016Cost 4 097 4 411 4 212 5 415 227 3 167 10 986 886 1 256 30 525 65 182Accumulated depreciation (3 416) (1 244) (1 692) (4 297) (203) (2 753) (7 158) (738) (628) – (22 129)

Carrying amount 681 3 167 2 520 1 118 24 414 3 828 148 628 30 525 43 053

Year ended 28 February 2015Opening carrying amount 269 1 440 221 67 400 – 186 – – 1 584 Additions 52 11 – 301 – 37 – 52 474 – 927 Disposals (1) (4) – (4) – – – (39) – – (48)Depreciation charge (98) (2) (137) (175) (31) (178) – (86) (40) – (747)

Closing carrying amount 222 6 303 343 36 259 – 113 434 – 1 716

At 28 February 2015Cost 709 251 2 816 1 557 214 938 – 236 916 – 7 637 Accumulated depreciation (487) (245) (2 513) (1 214) (178) (679) – (123) (482) – (5 921)

Carrying amount 222 6 303 343 36 259 – 113 434 – 1 716

Manufacturing equipment, plant and machinery and motor vehicles with a book value of R6 134 769 (2015: R729 217)

serve as security for instalment sale agreements (note 22).

Details of propertyThe property is situated at 76 Regency Drive, Route 21 Corporate Park, Irene, Gauteng. The property was registered in the Deeds

Office on 27 July 2015. At that date the full property cost was capitalised in the records of Parsec Properties Proprietary Limited.

The property serves as security for the borrowings as per note 22.


2016102

12. PROPERTY, PLANT AND EQUIPMENT CONTINUED

Tools andlaborotary Office Motor Computer Electronic Furniture Plant and equipment equipment vehicles equipment equipment and fittings machinery Total

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

COMPANYPeriod ended 31 March 2016Opening carrying amount 33 6 – 203 36 32 434 744 Additions – 6 536 189 14 28 350 1 123 Disposals – – – (18) – – – (18)Depreciation charge (8) (2) (79) (135) (26) (14) (156) (420)

Closing carrying amount 25 10 457 239 24 46 628 1 429

At 31 March 2016Cost 76 216 1 108 1 017 227 482 1 256 4 382 Accumulated depreciation (51) (206) (651) (778) (203) (436) (628) (2 953)

Carrying amount 25 10 457 239 24 46 628 1 429

Year ended 28 February 2015Opening carrying amount 8 1 – 100 67 81 – 257 Additions 35 9 – 207 – 16 474 741 Disposals (1) (2) – (5) – – – (8)Depreciation charge (9) (2) – (99) (31) (65) (40) (246)

Closing carrying amount 33 6 – 203 36 32 434 744

At 28 February 2015Cost 76 226 747 989 214 453 916 3 622 Accumulated depreciation (43) (220) (747) (786) (178) (421) (482) (2 878)

Carrying amount 33 6 – 203 36 32 434 744

Plant and machinery, and motor vehicles with a book value of R963 586 (2015: R426 444) serve as security for instalment sale

agreements (note 22).



2016103

12. PROPERTY, PLANT AND EQUIPMENT CONTINUED

Tools andlaborotary Office Motor Computer Electronic Furniture Plant and equipment equipment vehicles equipment equipment and fittings machinery Total

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

COMPANYPeriod ended 31 March 2016Opening carrying amount 33 6 – 203 36 32 434 744 Additions – 6 536 189 14 28 350 1 123 Disposals – – – (18) – – – (18)Depreciation charge (8) (2) (79) (135) (26) (14) (156) (420)

Closing carrying amount 25 10 457 239 24 46 628 1 429

At 31 March 2016Cost 76 216 1 108 1 017 227 482 1 256 4 382 Accumulated depreciation (51) (206) (651) (778) (203) (436) (628) (2 953)

Carrying amount 25 10 457 239 24 46 628 1 429

Year ended 28 February 2015Opening carrying amount 8 1 – 100 67 81 – 257 Additions 35 9 – 207 – 16 474 741 Disposals (1) (2) – (5) – – – (8)Depreciation charge (9) (2) – (99) (31) (65) (40) (246)

Closing carrying amount 33 6 – 203 36 32 434 744

At 28 February 2015Cost 76 226 747 989 214 453 916 3 622 Accumulated depreciation (43) (220) (747) (786) (178) (421) (482) (2 878)

Carrying amount 33 6 – 203 36 32 434 744

Plant and machinery, and motor vehicles with a book value of R963 586 (2015: R426 444) serve as security for instalment sale

agreements (note 22).


2016104

13. INTANGIBLE ASSETS Customer

relationships and brands

Computer software Goodwill

Developed products Total

R’000 R’000 R’000 R’000 R’000

GROUPPeriod ended 31 March 2016Opening net book value – 175 15 059 1 635 16 869 Additions – 247 - 1 183 1 430 Amortisation charge (3 937) (450) - (2 187) (6 574)Business combination (note 32) 23 620 149 78 013 6 911 108 693

Closing net book value 19 683 121 93 072 7 542 120 418

At 31 March 2016Cost 23 620 5 412 93 072 19 976 142 080 Accumulated amortisation (3 937) (5 291) - (12 434) (21 662)

Closing net book value 19 683 121 93 072 7 542 120 418

Year ended 28 February 2015Opening net book value – 49 15 059 4 120 19 228Additions – 263 – – 263 Amortisation charge – (137) – (1 317) (1 454)Impairments – – – (1 168) (1 168)

Closing net book value – 175 15 059 1 635 16 869

At 28 February 2015Cost – 1 953 15 059 8 625 25 637Accumulated amortisation – (1 778) – (6 990) (8 768)

Closing net book value – 175 15 059 1 635 16 869

Computer software

Developedproducts Total

R’000 R’000 R’000

COMPANYPeriod ended 31 March 2016Opening net book value 132 1 635 1 767 Additions 16 – 16 Amortisation charge (115) (641) (756)

Closing net book value 33 994 1 027

At 31 March 2016Cost 1 273 8 625 9 898 Accumulated amortisation (1 240) (7 631) (8 871)

Closing net book value 33 994 1 027

Year ended 28 February 2015Opening net book value 23 4 120 4 143 Additions 203 – 203 Amortisation charge (94) (1 317) (1 411)Impairments – (1 168) (1 168)

Closing net book value 132 1 635 1 767

At 28 February 2015Cost 1 294 8 625 9 919 Accumulated amortisation (1 162) (6 990) (8 152)

Closing net book value 132 1 635 1 767



2016105

13. INTANGIBLE ASSETS CONTINUEDImpairment of intangibles The recoverable amount of the development cost assets ready for sale is determined on fair value (level 3) less cost to sell

calculations and is based on the assumption that a certain number of units will be sold over a two-to-seven year period.

The fair value is based on management’s best estimated selling price in the current market conditions, which take into

consideration previous selling prices and current market conditions. Pre-tax discount rate of 30% was used to take into

account the time value of money and other variables.

The impairment in the prior period relates to the development cost capitalised for the Continuous Rope Monitoring System

(“CRMS”) of R794 887 and the Mobile Rope Monitoring System (“MRTU Triton”) of R373 489. The challenging mining market

conditions have had a significant impact on the sales of the Rope Monitoring System which triggered the requirement for

impairment.

In the current year, no impairment has been provided on the Rope Monitoring System, as management is confident that future

sales on the MRTU Triton product, based on current market information, justify the carrying amount of the intangible.

Impairment tests for goodwillAnsys LimitedThe recoverable amount of the CGU for on board system products is determined based on a value-in-use calculation.

The calculation used pre-tax cash flow projections based on financial budgets approved by the Executive Committee covering

a three-year period. Cash flows beyond the initial three-year period were extrapolated using the estimated growth rate

disclosed below. The discount rates are pre-tax and reflect the specific risks relating to the relevant segments. The key

assumptions used for the value-in-use calculation are as follows:GROUP


% %

Key assumptions used for value-in-use calculationsGross margin 33 34Growth rate 1 1Discount rate 21 22

Parsec Proprietary LimitedThe recoverable amount of the goodwill due to the Parsec business combination is determined based on a value-in-use

calculation. The calculation used pre-tax cash flow projections based on financial budgets approved by the Executive

Committee covering a three-year period. Cash flows beyond the initial three-year period were extrapolated using the

estimated growth rate disclosed below. The discount rates are pre-tax and reflect the specific risks relating to the relevant

segments. The key assumptions used for the value-in-use calculation are as follows:

GROUP31 March 28 February

2016 2015% %

Key assumptions used for value-in-use calculationsGross margin 33 –Growth rate 10 –Discount rate 18 –

Sensitivity analysis The various sensitivity analyses performed by changing key variables with 10% in the calculation resulted in the recoverable

amount exceeding the carrying amount in all instances.


2016106

COMPANY31 March 28 February

2016 2015R’000 R’000

14. INVESTMENTS IN SUBSIDIARIES

Quadsoft Pty LtdShares at cost – 100% 15 711 15 711 Impairment of investment (6 902) (6 902)

Carrying amount of investment 8 809 8 809

Tedaka Network Solutions Pty LtdShares at cost – 100% 18 400 18 400

Parsec Holdings Pty LtdShares at cost – 100% 99 996 –

Redline Telecommunications SA Pty LtdShares at cost 3 831 –

The investment above relates to the direct holding in 20% of the share capital of Redline

Telecommunications SA Pty Ltd. Ansys Ltd owns the remaining 80% of the share capital in

this company via its 100% shareholding in Parsec Holdings Pty Ltd.

Parsec Pty LtdShares at cost 30 317 –

The investment above relates to the direct holding in 25% of the share capital of

Parsec Pty Ltd. Ansys Ltd owns the remaining 75% of the share capital in this company

via its 100% shareholding in Parsec Holdings Pty Ltd.

Total investments in subsidiaries 161 354 27 209

All subsidiaries are incorporated in South Africa.


2016 2015 2016 2015R’000 R’000 R’000 R’000

15. DEFERRED TAX ASSETS/(LIABILITIES)Deferred income taxes are calculated on all temporary

differences under the liability method using a principal

tax rate of 28% (2015: 28%).

The gross movement on the deferred income tax account is

as follows:At beginning of the period 7 612 11 579 6 428 8 811 Statement of comprehensive income charge 42 (3 967) (2 152) (2 383)Net deferred tax asset acquired (note 32) (5 639) – – –

At end of the period 2 015 7 612 4 276 6 428



2016107

15. DEFERRED TAX ASSETS/(LIABILITIES) CONTINUEDDeferred tax assets and liabilities are attributable to the

following items:

Deferred income tax assets 12 021 8 506 5 835 7 256

Provision for impairment of trade receivables 128 117 – – Leave accrual 686 363 306 299 Interest accrual 161 – – – Provision for slow moving stock 1 292 821 247 188 Provision for bonuses 1 458 1 899 – 1 468 Warranty provision 421 638 421 638 Leases – 33 – 27 Billings in excess of earnings and prepayments 2 052 1 007 91 1 007 Calculated tax loss 5 823 3 628 4 770 3 629

Deferred income tax liabilities (10 006) (894) (1 559) (828)

Prepayments (42) – – – Retention debtors (114) (370) (114) (370)Deferred revenue (1 142) – (1 142) – Leases (25) – (25) – Intangible assets (7 120) (458) (278) (458)Property, plant and equipment (1 563) (66) – –

Net deferred income tax asset 2 015 7 612 4 276 6 428

16. INVENTORIESRaw materials and finished goods 66 997 29 852 17 802 4 430 Provision for slow moving stock (4 616) (5 484) (884) (672)

62 381 24 368 16 918 3 758 Work-in-progress 22 393 16 165 13 099 15 745

84 774 40 533 30 017 19 503

17. TRADE AND OTHER RECEIVABLESTrade receivables 102 201 62 068 35 753 44 767

Total 102 811 62 752 35 753 44 767 Provision for impairment (610) (684) – –

Deposits 663 – – – Project receivables (work–in–progress) 4 949 475 4 079 475 Prepayments 9 239 – – – Staff loans 154 – 79 – Sundry debtors 413 949 373 318 Retention debtors 407 1 324 406 1 324 Receiver of Revenue (VAT) 3 656 – – –

121 682 64 816 40 690 46 884


2016 2015 2016 2015R’000 R’000 R’000 R’000


2016108

17. TRADE AND OTHER RECEIVABLES CONTINUEDAll trade and other receivables are due within 1 year

from the reporting date.

The fair values of trade and other receivables are as follows:Trade receivables 102 201 62 068 35 753 44 767 Other receivables 19 481 2 748 4 937 2 117

121 682 64 816 40 690 46 884

As of 31 March 2016, trade receivables of R0,610 million

(February 2015: R0,684 million) were provided for at group

level. The ageing of these receivables is as follows:

More than six months 610 684 – –

610 684 – –

As of 31 March 2016, trade receivables of R13,522 million

(February 2015: R2,676 million) were past due but not

impaired. These relate to a number of independent

customers for whom there is no recent history of default.

The ageing analysis of these trade receivables is as follows:

Up to three months 8 171 2 135 736 206 Between three and six months 5 170 541 191 –More than six months 181 – – –

13 522 2 676 927 206

Movements on the provision for impairment of trade

receivables are as follows:

At beginning of the period 684 – – – (Unused amounts reversed)/increase in provision (74) 684 – –

At end of the period 610 684 – –

The creation and release of provision for impaired receivables have been included in the statement of comprehensive income.

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. The group does not hold any collateral

as security.

Further information about related party receivables is presented in note 28.

Debtors serve as security for the group’s invoice discounting facility (note 19).


2016 2015 2016 2015R’000 R’000 R’000 R’000



2016109

18. OTHER FINANCIAL ASSETS

Interest free borrowings

Meridic Pty Ltd 265 – – – Tau Di A Rora Technologies CC 410 – – –

675 – – –

These loans are unsecured and have no

fixed term of repayment.

19. CASH AND CASH EQUIVALENTSCash at bank 42 333 19 379 919 3 024 Cash on hand 25 11 10 11

42 358 19 390 929 3 035

For the purpose of the statement of cash flows the period-end cash, cash equivalents and bank overdrafts comprise the following:

Cash on hand and at bank 42 358 19 390 929 3 035 Bank overdrafts (14 705) – (9 675) –

27 653 19 390 (8 746) 3 035

Refer to note 2.1 for bank accounts denominated in foreign currencies.

At 31 March 2016, the group had a combination of overdraft and invoice discounting facilities to assist with operational cash flow requirements.

The bank overdraft facilities of R22 million (2015: R13,5 million) were secured over cession of book debts of the companies in the group that they related to.

The invoice discounting facility comprises 80% (2015: 80%) of the debtors book within the company where the facility is utilised, at any given point capped at R10 million (2015: R10 million). The facility is secured by a cession of debtors of this particular company (note 17).

The extent of the group’s facilities with its bankers can be summarised as follows:

– Overdraft facility 22 000 13 500 12 000 10 000 – Combined Letter of Guarantee and

Forward Exchange Cover facility 5 000 – – – – Revolving Credit Line facility 8 000 – – – – Invoice Discounting facility 10 000 – – – – Issued Letter of Performance Guarantee 2 949 – – –


2016 2015 2016 2015R’000 R’000 R’000 R’000


2016110

2016 2016 2015 2015Number of

shares R'000Number of

shares R'000

20. SHARE CAPITALOrdinary sharesAuthorisedTotal number of authorised ordinary shares 1 725 490 496 1 725 490 496

IssuedOpening balance 244 867 056 73 668 244 867 056 73 668

Number of shares issued during the period– April 2015 47 778 889 17 200 – –– July 2015 22 674 375 9 070 – –– July 2015 145 718 001 112 203 – –

Closing balance 461 038 321 212 141 244 867 056 73 668

The shares have no par value and the issued shares are fully paid. Each issued share has one voting right and there are no restrictions.

On 9 September 2015, an ordinary resolution was passed by way of general authority, to sell all or any of the authorised but unissued shares in the capital of the company for cash, subject to the memorandum of incorporation of the company, the requirements of the Companies Act of South Africa and the JSE Listings Requirements, when applicable.


2016 2015 2016 2015R’000 R’000 R’000 R’000

21. RELATED PARTY LOANSLoans to related parties

Tedaka Network Solutions Pty Ltd – – 9 070 1 701

– – 9 070 1 701

The 2015 loan to Tedaka Network Solutions Pty Ltd was

unsecured, with interest payable at prime rate, and was

repaid during the financial period.

The current loan bears no interest, is unsecured and has no

repayment terms.

Loans from related partiesTedaka Investments Pty Ltd – (9 070) – – Bearing Management Consultants Pty Ltd – (1 792) – (781) Quadsoft Pty Ltd – – (8 809) (8 809) T Daka – (4 206) – (335)

– (15 068) (8 809) (9 925)

The loan from Tedaka Investments Pty Ltd was unsecured, bore interest at prime rate and was repayable in October 2016.

The loans from Bearing Management Consultants Pty Ltd had the following terms:– The loan owing by subsidiaries of the group was unsecured, carried interest at prime rate and was repaid

during the financial period. – The loan owing by the company carried interest at prime plus 5,5% compounded monthly and was repaid during the

financial period.



2016111

21. RELATED PARTY LOANS CONTINUEDThe loan from Quadsoft Pty Ltd is unsecured, bears no

interest and has no fixed repayment terms.

The loan from T Daka was unsecured, bore interest at prime

rate plus 5,5% compounded monthly and was repaid in the

financial period.

Non-current assets – – 9 070 1 701 Non-current liabilities – (9 070) – – Current liabilities – (5 998) (8 809) (9 925)

– (15 068) 261 (8 224)

22. INTEREST BEARING BORROWINGSInstalment sale agreementsMinimum lease payments due– no later than one year 2 254 421 413 190 – later than one year and no later than five years 3 943 555 815 300 Less: Future finance charges (941) (94) (170) (44)

Present value of minimum lease payments 5 256 882 1 058 446

Present value of minimum lease payments due– no later than one year 1 836 350 356 153– later than one year and no later than five years 3 420 532 702 293

5 256 882 1 058 446

Total instalment sale agreements:Current liabilites 1 836 350 356 153Non-current liabilities 3 420 532 702 293

5 256 882 1 058 446

The loans bear interest at prime and are repayable in

monthly instalments of R201 444 (2015: R34 791) over an

average period of 60 months.Secured by: Manufacturing equipment, plant and

equipment and motor vehicles (note 12) with a

book value of: 6 135 729 964 426

The interest rate exposure of borrowings of the group is

as follows: Instalment sale agreement At floating rates (average %) 10,5 9,8 9,8 9,8


2016 2015 2016 2015R’000 R’000 R’000 R’000


2016112


2016 2015 2016 2015R’000 R’000 R’000 R’000

22. INTEREST BEARING BORROWINGS CONTINUEDProperty loanSenior debtMinimum payments due– no later than one year 3 434 – – – – later than one year and no later than five years 15 468 – – – – later than five years 22 381 – – – Less: Future finance charges (16 327) – – –

Present value of minimum lease payments 24 956 – – –

Present value of minimum payments due– no later than one year 867 – – – – later than one year and no later than five years 6 873 – – – – later than five years 17 216 – – –

24 956 – – –

The loan bears interest at prime and is repayable in

monthly instalments of R320 601 (2015: R0) over a

period of 120 months. Secured by: Property situated at

76 Regency Drive, Route 21 Corporate Park

with a fair value of: 32 575 – – –The interest rate exposure of borrowings of the group is

as follows:

Senior debt loan agreementAt floating rates (%) 10,4 – – –

The interest rate is fixed at 10,43% for the first three

years and thereafter at prime less 0,5%. A R5 million

residual value will remain on the loan at the end of

the 10 year period.

Mezzanine loan agreementTotal loan amount 5 000 – – –

At floating rates of prime plus 2% 12,5 – – –

The mezzanine finance of R5 million, with interest

payable monthly at a rate of prime plus 2%, is repayable

after three years. Also payable after the three year period

is a profit share amount of R3 million, payable to

Nedbank Ltd. Included in these financial results is a

rental accrual to reflect this profit share amount as an

interest expense over the three-year period. The liability

is included under accruals in note 24.

Total property loanCurrent liabilities 867 – – –Non-current liabilities 29 089 – – –

29 956 – – –



2016113


2016 2015 2016 2015R’000 R’000 R’000 R’000

22. INTEREST BEARING BORROWINGS CONTINUEDTotal interest bearing borrowings:Total current liabilities 2 703 350 356 153Total non-current liabilities 32 509 532 702 293

35 212 882 1 058 446

23. OTHER FINANCIAL LIABILITIESCurrent liabilitiesPrevious Parsec Holdings Pty Ltd shareholders 1 995 – 1 995 – Previous Redline Telecommunications SA Pty Ltd

shareholders 75 – 75 –

2 070 – 2 070 –

Non-current liabilitiesPrevious Parsec Holdings Pty Ltd shareholders 6 140 – 6 140 – Previous Redline Telecommunications SA Pty Ltd

shareholders 232 – 232 –

6 372 – 6 372 –

Total liabilities 8 442 – 8 442 –

The other financial liabilities represent the future

payments still payable in cash to the previous

Parsec Holdings Pty Ltd and Redline Telecommunications

SA Pty Ltd shareholders as part of the Parsec Holdings

business combination transaction during the

financial period.

The terms of the repayments of these loans are

described in the Business Combinations note (note 32).

24. TRADE AND OTHER PAYABLESTrade payables 118 451 80 888 24 368 37 001 Other payables

Accrued expenses 8 124 – – – Billings in excess of earnings and

prepayments received 22 570 4 075 325 4 075 Receiver of Revenue – VAT 774 3 611 72 3 021 Leave accrual 2 451 1 364 1 094 1 067 Sundry creditors 12 – 5 –

152 382 89 938 25 864 45 164

Trade and other payables are settled in South African Rand except where the payable is denominated in a foreign currency.

Refer to note 2.1 for the outsanding liabilities denominated in foreign currencies at period-end.


2016114


2016 2015 2016 2015R’000 R’000 R’000 R’000

25. CURRENT INCOME TAX LIABILITYBalance at beginning of the period (335) – – – Business combination (note 32) 308 – – – Charge to statement of comprehensive income (note 11) (8 513) (335) – –Taxation received during the period (465) – – – Taxation paid during the period 7 545 – – –

Balance at end of the period (1 460) (335) – –

26. PROVISIONSProvision for warrantyBalance at beginning of the period 2 280 209 2 280 209 Movement for the period (777) 2 071 (777) 2 071

Balance at end of the period 1 503 2 280 1 503 2 280

The provision for warranty claims on products sold and delivered was calculated on a project specific basis as the revenue on the product is recognised. A 3 - 7% failure rate and the estimated production and material cost was used to calculate the provision. The warranty claim is valid for a 12-month period.

Information that is typically considered is whether there is back-to-back warranty cover from the supplier on the products as well as material failure rate from historic information.

27. CASH (UTILISED IN)/ GENERATED FROM OPERATIONS Profit before tax 28 502 14 327 7 664 17 091 Adjustments for:Net finance costs 3 577 1 808 388 629 Depreciation 4 184 748 420 246 Amortisation 6 574 1 454 756 1 411 (Profit)/loss on sale of property, plant and equipment (21) 45 – (5)Reversal of impairment of investment in subsidiary – – – (8 700)Impairment of intangible assets – 1 168 – 1 168 (Decrease)/increase in provision for slow moving and obsolete raw materials (note 16) (868) – 212 – Decrease in provision for impairment of trade receivables (74) – – –

Unrealised foreign exchange differences 2 092 80 (380) 80

Balance before working capital changes 43 967 19 630 9 060 11 920Changes in working capitalIncrease in inventories (27 872) (11 316) (10 726) (9 419)(Increase)/decrease in receivables and prepayments (20 470) (40 786) 6 194 (36 845)Increase/(decrease) in trade and other payables (17 870) 54 656 (19 300) 36 515

(Decrease)/increase in provisions (777) 2 072 (777) 2 071

(23 022) 24 256 (15 169) 4 242



2016115


2016 2015 2016 2015R’000 R’000 R’000 R’000

28. RELATED PARTY TRANSACTIONSDirectors’ remuneration (note 8) 15 159 5 989 4 233 5 989

Basic salary

Medicalaid

Retire-ment

contri-bution

Feespaid to

directorsfor

services

Bonus and perfor-mance

related payments Total

R’000 R’000 R’000 R’000 R’000 R’000

GROUP2016Executive directors – paid by Ansys LtdT Daka 1 782 111 96 – – 1 989 R Grobbelaar 1 274 – 58 – – 1 332

Non-executive directors – paid by Ansys LtdNS Mjoli-Mncube – – – 390 – 390 SP Mzimela – – – 220 – 220 N Medupi – – – 100 – 100 FF Dantile – – – 98 – 98 CP Bester – – – 104 – 104

Total paid by Ansys 3 056 111 154 912 – 4 233

Non-executive directors – paid by subsidiariesCP Bester – – – 104 – 104

Executive directors – paid by subsidiariesAR van der Watt 914 97 170 30 420 1 631 PC Pelser 1 038 81 62 30 420 1 631 R Fullard 905 – 81 15 210 1 211 EAF Bielich 677 38 62 15 120 912 DT van Loggerenberg 779 66 142 15 210 1 212 F de Wet 813 30 141 15 210 1 209 WL Masekela 468 21 56 9 – 554 PC van der Merwe 609 – – 15 – 624 WL Joubert 663 – – – – 663 BC Lamprecht 822 58 71 15 210 1 176

Total paid by subsidiaries 7 687 391 786 263 1 800 10 926

Total directors’ remuneration 10 743 502 940 1 175 1 800 15 159

2015Executive directors – Ansys LtdT Daka 1 527 101 91 – 1 264 2 983 R Grobbelaar 1 366 – 74 – 806 2 246

Non-executive directors – Ansys LtdNS Mjoli-Mncube – – – 360 – 360 SP Mzimela – – – 160 – 160 D Keebine – – – 80 – 80 FF Dantile – – – 160 – 160

Total directors’ remuneration 2 893 101 165 760 2 070 5 989


2016116


2016 2015 2016 2015R’000 R’000 R’000 R’000

28. RELATED PARTY TRANSACTIONS CONTINUEDIntercompany and related party chargesSales of goods and servicesTedaka Network Solutions Pty Ltd– Finance costs – – – 506 – Finance income – – 376 74 – Management fees – – 1 304 5 797

T Daka– Finance costs 63 506 4 35

Bearing Management Consultants Pty Ltd– Finance costs 18 169 10 81

TDK Trust– Finance costs – 54 – –

Parsec Holdings shareholders (note 23) – Finance costs 166 – 166 –

Purchase of goods and servicesParsec Pty Ltd– Goods and services – – 1 282 – Redline Telecommunications SA Pty Ltd– Goods and services – – 23 –

Outstanding balances arising from purchases of goods/servicesParsec Pty Ltd – – 1 432 –

Loans to related partiesTedaka Network Solutions Pty Ltd – – 9 070 1 701

Loans from related partiesTedaka Investments Pty Ltd – 9 070 – – Bearing Management Consultants Pty Ltd – 1 792 – 781 Quadsoft Pty Ltd – – 8 809 8 809 T Daka – 4 206 – 335

T Daka is a director and a shareholder of Ansys Limited.

Bearing Management Consultants Proprietary Limited, and Tedaka Investments Proprietary Limited are companies controlled by

T Daka.

TDK Trust is a trust of which a trustee is a director of Ansys Limited (T Daka).



2016117

Loans and receivables

Financial liabilities at

amortised cost

Loans and

receivables

Financial

liabilities at

amortised

cost 31 March 31 March 28 February 28 February

2016 2016 2015 2015R’000 R’000 R’000 R’000

29. FINANCIAL INSTRUMENTS BY CATEGORYThe accounting policies for financial instruments have

been applied to the line items below:

GROUPAssets as per statement of financial positionTrade and other receivables 118 026 – 64 816 – Cash and cash equivalents 42 358 14 705 19 390 – Other financial assets 675 – – –

Liabilities as per statement of financial positionTrade and other payables – 149 157 – 84 963Interest bearing borrowings – 35 212 – 882 Bank overdrafts – 14 705 – – Related party loans – – – 15 068 Other financial liabilities – 8 443 – –

161 059 222 222 84 206 100 913

COMPANYAssets as per statement of financial positionTrade and other receivables 40 690 – 46 884 – Cash and cash equivalents 929 9 675 3 035 – Related party loans 9 070 – 1 701 –

Liabilities as per statement of financial positionRelated party loans – 8 809 – 9 925 Trade and other payables – 24 698 – 41 076 Interest bearing borrowings – 1 058 – 446 Other financial liabilities – 8 443 – –

50 689 52 683 51 620 51 447

Total shares

Weighted shares

Total

shares

Weighted

shares2016 2016 2015 2015

Number Number Number Number

30. EARNINGS PER SHARETotal and weighted sharesNumber of shares in issue:Opening balance 244 867 056 244 867 056 244 867 056 244 867 056 Shares issued during the year 216 171 265 165 930 014 – –

Closing balance 461 038 321 410 797 070 244 867 056 244 867 056


2016118


R’000 R’000

30. EARNINGS PER SHARE CONTINUEDBasic and diluted earnings per share attributable to ordinary shareholdersNet profit attributable to ordinary shareholders 19 974 10 025 Weighted average number of shares in issue 410 797 070 244 867 056

Basic and diluted earnings per share attibutable to ordinary shareholders (cents) 4,86 4,09

Headline and diluted headline earnings per share attributable to ordinary shareholdersNet profit attributable to ordinary shareholders 19 974 10 025

Non-headline items after tax:Impairment of intangible asset – 1 168 Profit on the sale of property, plant and equipment (note 6) (21) – Total tax effect of adjustments 5 (327)

Headline and diluted headline earnings per share attributable to ordinary shareholders 19 958 10 866

Weighted average number of shares in issue 410 797 070 244 867 056 Headline and diluted headline earnings per share attibutable to ordinary shareholders (cents) 4,86 4,44

31. SEGMENT INFORMATION

The segment information has been prepared in accordance with IFRS 8, ‘Operating Segments’, which defines requirements of

the disclosure of financial information of an entity’s operating segments.

Identification of reportable segments The group discloses its reportable segments according to the group’s components that management monitors regularly in

making decisions about the operating matters. The reportable segments comprise various operating segments primarily

located in South Africa based on the group’s lines of business. Management has reviewed the segment report due to the Parsec

acquisition. The segment names have been changed from “Mining” to “Mining and Industrial” as well as “Defence” to “Defence

and Information Security” to include new segments from the Parsec acquisition.

Measurement of operating segment profit or loss, assets and liabilitiesSegment information is prepared in conformity with the basis that is reported to the Executive Committee in assessing

segment performance and allocating resources to segments. These values have been reconciled to the consolidated

financial statements. The basis reported by the group is in accordance with the accounting policies adopted for preparing and

presenting the consolidated group financial statements and are consistent with the prior year, except for the following:

In the previous financial year, segment profit in Rail, Defence and Information Security, Mining and Industrial was reported on

a gross profit basis, and Telecoms was reported on net profit (after tax and interests). This year segment profits are all based

on net profit, calculated as gross profits for the segments, with the remaining costs in the entities (less corporate costs) being

apportioned to segments based on gross profit margin percentages.

In the prior year the segment profit/(loss) was stated as follows:

R’000

Rail 29 778 Mining and Industrial (4 110)Defence and Information Security 2 721 Telecoms 5 936



2016119

31. SEGMENT INFORMATION CONTINUEDMeasurement of operating segment profit or loss, assets and liabilities continuedSegment revenue excludes value added taxation and relates to external customers only. Net revenue represents segment

revenue from which intersegment revenue has been eliminated. Segment expenses include direct and allocated expenses.

Segment assets exclude tax assets and assets used primarily for corporate purposes, or assets and liabilities that cannot be

allocated to segments reliably. The segment assets comprise all assets of the different segments that are employed by the

segment and that either are directly attributable to the segment or can be allocated to the segment on a reasonable basis.

Intangible assets and goodwill identified as part of business combinations are allocated to segments that they relate to. When

these intangible assets are attributable to more than one segment, this is allocated to the relevant segments based on the net

profit contribution of the relevant segments.

Reportable segments During the year the group conducted operations in four main business areas: Rail; Defence and Information Security; Mining

and Industrial; and Telecoms. Transactions between the business segments are on normal commercial terms and conditions.

Information about geographical areas No geographical area segment information is disclosed, as the group’s business for the period ended 31 March 2016 was mostly

conducted within the Republic of South Africa. The risk and rewards are not considered to be different within the regions of

the Republic of South Africa. All revenue from external customers can be attributed to the entity’s country of domicile, and no

assets of the group are located in any foreign countries.

Rail

Defence and

Information Security

Mining and Industrial Telecoms Corporate Total

R’000 R’000 R’000 R’000 R’000 R’000

GROUP2016Segment results– Segment sales 137 016 90 145 42 548 204 357 – 474 066 – Segment expenses (119 202) (77 201) (38 519) (194 397) – (429 320)– Segment forex profit/(loss) (1 943) 3 054 – (3 830) – (2 719)

– Segment profit 15 871 15 997 4 029 6 130 – 42 027 – Corporate expenses (9 947) (9 947)

Operating profit 32 080 Finance income 1 419 1 419 Finance costs (4 996) (4 996)

Profit before tax 28 503Taxation (8 529)

Profit for the period 19 974

Financial positionAssets 98 043 70 700 33 207 127 308 95 723 424 981

Liabilities 1 263 23 995 – 94 271 104 181 223 710


2016120

Rail

Defence and

Information Security

Mining and Industrial Telecoms Corporate Total

R’000 R’000 R’000 R’000 R’000 R’000

31. SEGMENT INFORMATION CONTINUEDGROUP2015Segment results– Segment sales 94 109 9 993 2 112 144 907 – 251 121 – Segment expenses (75 888) (8 431) (3 304) (143 183) – (230 806)– Segment development cost

impaired – – (1 168) – – (1 168)– Segment forex profit/(loss) (1 122) – – 5 391 – 4 269

– Segment profit 17 099 1 562 (2 360) 7 115 – 23 416 – Corporate expenses (7 281) (7 281)

Operating profit 16 135 Finance income – – – – 34 34 Finance costs – – – – (1 842) (1 842)Development cost impaired – – (1 168) – – (1 168)

Profit before tax 14 327Taxation (4 302)

Profit for the period 10 025

Financial position Assets 58 810 1 012 1 635 55 881 34 492 151 830

Liabilities – – – 59 563 49 834 109 397

32. BUSINESS COMBINATIONBusiness acquistion of ParsecOn 1 June 2015, Ansys acquired the shares and all the shareholders’ claims against Parsec Holdings Proprietary Limited (“Parsec Holdings”), Parsec Proprietary Limited (“Parsec”) and Redline Telecommunications SA Proprietary Limited (“Redline”).

The acquisition is another significant step for Ansys to become an Intellectual Property-led provider of technology-driven engineering solutions, producing world class products for global distribution. Although Ansys and Parsec in general target the same markets, there is very little overlap in terms of product and service offerings between the operations of these companies, and the acquisition provided access to:• Intellectual property and the scarce skill sets of a sought after professional team of engineers; • An opportunity to diversify Ansys’ income streams by enhancing its mining and industrial, defence and information security

and telecommunications segments, as well as entry into the international defence market; • New products for Ansys’ existing clients and markets; • A modern production facility also utilised for third party contract manufacturing purposes; and • General economies of scale benefits.

The initial purchase consideration was made up as follows:• R63 583 492, of which R6 700 000 relates to the property and was only payable once the property was transferred into the

name of Parsec Properties Proprietary Limited, payable to Parsec Holdings sellers, by the issue of 102 475 593 Ansys shares at 40 cents per share and R22 593 255 in cash;

• R15 750 002, which relates to the 25% shareholding in Parsec not owned by Parsec Holdings, payable to the Parsec seller, by the issue of 39 375 004 Ansys shares at 40 cents per share; and

• R2 399 626, which relates to the 20% shareholding in Redline not owned by Parsec Holdings, payable to the Redline seller by the issue of 3 867 404 Ansys shares at 40 cents per share and R852 664 in cash.



2016121

32. BUSINESS COMBINATION CONTINUEDPrior to the effective date, Parsec Holdings distributed R10 000 000 and R9 779 203 to the Parsec Holdings sellers.The cash consideration payable (undiscounted) to the sellers will be settled in three tranches as follows:

• The first tranche of R10 000 000 was paid in cash on the closing date, R9 636 327 was paid to the Parsec Holdings sellers

and R363 673 was paid to the Redline sellers. This payment was subject to Parsec Holdings achieving a minimum NTAV of

R25 million on the effective date, which was achieved;

• The second tranche of R3 500 000 was paid in cash on 1 December 2015, to the sellers. R3 372 715 was paid to the Parsec

Holdings sellers and R127 285 was paid to the Redline sellers;

• The third tranche of R9 945 919 is payable in cash to the sellers as follows:

– The first instalment of R2 300 000 was payable on 1 June 2016, R2 216 255 to the Parsec Holdings sellers and R83 645 to

the Redline sellers; and

– The subsequent instalments of R2 500 000 each are payable in quarterly instalments commencing 1 June 2017 and

accruing interest at the prime interest rate. R7 367 858 is payable to Parsec Holdings and R278 061 to the Redline sellers.

– These are payable subject to Parsec having sufficient free cash flow. In the event that Parsec does not have sufficient

free cash flow, the quarterly instalments of R2 500 000 each shall be increased by the amount of the shortfall in free

cash flow; and

– In the event that any tranche and/or tranche shortfall is not paid after 36 months from 1 June 2015, due to a shortfall in

free cash flows, all the said amounts shall be forfeited.

The transaction costs of the business combination approximated R2,4 million.

The issue price of 40 cents per share, as reported in the circular, was determined by the board on 8 October 2014 and was

at a premium of 1,37% to the 30-day VWAP of Ansys for the 30 days preceding 8 October 2014. The fair value of the shares

issued was based on the published share price as at 1 June 2015, which was 77 cents. As a result of an increase in the market

price and recognising the issue of the shares in the financial statements at fair value, the purchase consideration increased

by R30,5 million.

31 March2016

R’000

Accounting for business combination

The net assets acquired and method of settlement was as follows:Fair value of the purchase consideration – Shares issued 112 203 – Cash consideration 15 570 – Contingent cash consideration 6 373

Total purchase consideration 134 146

The fair value of assets and liabilities acquired comprises:Property, plant and equipment 40 832 Intangible assets 7 060 Deferred tax 975 Other financial assets 345 Inventory 15 504 Trade and other receivables 36 322 Cash and cash equivalents 20 781 Current tax receivable 308 Minority interest (390)Interest bearing borrowings (4 387)Trade and other payables (78 223)

Total fair value of assets acquired 39 127


2016122

31 March2016

R’000

32. BUSINESS COMBINATION CONTINUEDTotal fair value of assets acquired 39 127Customer relationships 19 930Brands 3 690Goodwill 78 013Deferred tax (6 614)

Total purchase consideration 134 146

The acquired business contributed revenues of R145,8 million and net profit of R14,8 million to the group for the period from

1 June 2015 to 31 March 2016. The acquired business would have contributed revenue of R177,7 million and a net profit of

R13,2 million had it been part of the group for the 12 months since 1 April 2015. It is impracticle to include comparative figures

for the same 13-month period as for Ansys, as this one extra month of the acquired business was not audited.


2016 2015 2016 2015R’000 R’000 R’000 R’000

33. COMMITMENTS UNDER OPERATING LEASESThe group has outstanding commitments under

non-cancellable operating leases that fall due as follows:

Leased propertyMinimum lease payments under operating leases

recognised as an expense during the year 2 982 2 682 1 602 1 089

Within one year 2 050 2 233 1 608 1 187 Later than one year but within five years – 662 – 303

2 050 2 895 1 608 1 490

Motor vehiclesMinimum lease payments under operating leases

recognised as an expense during the year 945 648 945 470

Within one year 954 1 037 954 806 Later than one year but within five years 736 1 643 736 1 388

1 690 2 680 1 690 2 194

CopiersMinimum lease payments under operating leases

recognised as an expense during the year 158 102 100 102

Within one year 197 102 139 102 Later than one year but within five years 917 154 805 154

1 114 256 944 256



2016123

34. POST-RETIREMENT OBLIGATIONSThe group’s personnel are members of a non-contributing provident fund. The group has no obligation towards the employees

after retirement.

35. GOING CONCERNThe financial statements have been prepared on the basis of accounting policies applicable to a going concern. This basis

presumes that funds will be available to finance future operations and that the realisation of assets and settlement of

liabilities, contingent obligations and commitments will occur in the ordinary course of business.

The directors have reviewed the group’s budget and cash flow forecasts for the period ended March 2017 which include

certain assumptions about the cash flows from planned and unplanned projects and raising additional funding when required.

On this basis and in light of the group’s current financial position, the directors are satisfied that the group will continue

to operate for the foreseeable future and have therefore adopted the going concern basis in preparing these financial

statements.

36. MATERIAL EVENTS AFTER YEAR-ENDNo event which is material to the financial affairs of the group has occurred between the reporting date and the date of the

approval of the financial statements.

37. FAIR VALUE HIERARCHYAssets and liabilities measured or disclosed at fair value in the statement of financial position are categorised in its entirety

into the following three levels of the fair value hierarchy based on the basis of the lowest level input that is significant to the

fair value measurement in its entirety:Level 1: fair value measured using quoted prices (unadjusted) in active markets for identical financial assets or liabilities

Level 2: fair value measured using inputs other than quoted prices included within level 1 that are observable for the financial

asset or liability, either directly or indirectly; and

Level 3: fair value measured using inputs for the financial asset or liability that are not based on observable market data.

For fair value of financial instruments traded in active markets (such as held for trading and available-for-sale securities) is

based on quoted market prices at the financial year-end date. The quoted market price for financial assets held by the group is

current bid price. The fair value of forward exchange contracts is determined using the quoted forward exchange rates at the

financial year-end date, with the resulting value discounted back to present value.

The fair value of financial liabilities categorised as “other financial liabilities”: and financial assets categorised as “loans and

receivables” is determined in accordance with generally accepted pricing models comprising discounted cash flow analysis.

The fair value of derivative financial assets (eg forward exchange contracts) is based on a level 2 recurring fair value

measurement hierarchy.

The carrying value of non-current financial assets and liabilities at market-related floating rates approximate fair value and is

classified as level 3.

Where the effects of discounting are immaterial, short-term receivables and short-term payables are measured at the original

invoice amount. Due to the short-term nature of trade receivables and trade payables their carrying amounts approximate

their fair value.


Ansys has delivered a solid financial performance with growth across the board


2016126

SHARE PERFORMANCE

Ansys Limited versus the AltX Index

Ansys Limited AltX Index

120

110

100

90

80

70

60

50

402015 2016

MarMar AugApr Sep May OctJun Nov JanJul Dec Feb

Ansys Limited versus the Electronic Equipment Index

120

110

100

90

80

70

60

50

40

30

Ansys Limited Electronic Equipment Index

2015 2016

MarMar AugApr SepMay OctJun Nov JanJul Dec Feb

cents

cents


2016127

ANALYSIS OF SHAREHOLDERS

Company Ansys Limited

Register date 24 March 2016

Issued share capital 461 038 321

Shareholder spreadNumber of

shareholdersPercentage

held Number of

shares heldPercentage

held

1 – 1 000 shares 215 14,34 105 344 0,02

1 001 – 10 000 shares 445 29,69 2 302 608 0,50

10 001 – 100 000 shares 631 42,09 25 320 301 5,49

100 001 – 1 000 000 shares 168 11,21 46 892 102 10,17

1 000 001 shares and over 40 2,67 386 417 966 83,81

Total 1 499 100,00 461 038 321 100,00

Shareholder spreadNumber of


held Number of


held

Banks 2 0,13 5 314 201 1,15

Close corporations 20 1,33 2 288 535 0,50

Individuals 1 259 83,99 142 206 641 30,84

Insurance companies 2 0,13 11 950 810 2,59

Investment companies 4 0,27 2 677 316 0,58

Mutual funds 3 0,20 3 399 834 0,74

Other corporations 8 0,53 558 500 0,12

Private companies 59 3,94 142 544 333 30,92

Retirement funds 4 0,27 1 087 279 0,24

Trusts 136 9,07 148 418 406 32,19

Public companies 2 0,13 592 466 0,13

Total 1 499 100,00 461 038 321 100,00

Public/non-public shareholdersNumber of


held Number of


held

Non-public shareholders 7 0,47 194 481 040 42,18

Directors and associates of the company 7 0,47 194 481 040 42,18

Public shareholders 1 492 99,53 266 557 281 57,82

Total 1 499 100,00 461 038 321 100,00

Beneficial shareholders holding 3% or moreNumber of


held

Tedaka Investments Pty Ltd 102 674 375 22,27

Daka, T 45 062 745 9,77

Montshepetsa Boshego Family Trust 39 375 004 8,54

P & V Trust 21 814 752 4,73

CNR Trust 21 814 752 4,73

Coen Bester Trust 19 708 291 4,27

Total 250 449 919 54,32


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ANSYS LIMITED(Incorporated in the Republic of South Africa)

(Registration number: 1987/001222/06)

(“Ansys” or “the company”)

ISIN code: ZAE 000097028

Share code: ANS

If you are in doubt as to what action to take in regard to this notice, please consult your Central Securities Depository Participant (“CSDP”), broker, banker, accountant, attorney or other professional adviser immediately and refer to the instructions set out in the conclusion of this notice.

Notice is hereby given that an annual general meeting of shareholders of the company will be held on Thursday, 3 November 2016 at 10:00 at 140 Bauhinia Street, Highveld Techno Park, Centurion to deal with such business as may lawfully be dealt with at the

meeting and to consider and, if deemed fit, pass, with or without modification, the ordinary and special resolutions set out hereunder

in the manner required by the Companies Act 71 of 2008, as amended “(the Companies Act”), the memorandum of incorporation

(“MOI”) of the company and the Listings Requirements of the JSE Limited (“JSE Listings Requirements”).

The record date on which members must be recorded as such in the register maintained by the transfer secretaries of the company

for the purpose of being entitled to attend and vote at the annual general meeting is 21 October 2016.

Meeting participants (including shareholders and proxies) are required to provide reasonably satisfactory identification before

being entitled to attend or participate in a shareholders’ meeting. Forms of identification include valid identity documents, driver’s

licences and passports.

PRESENTATION OF ANNUAL FINANCIAL STATEMENTSThe consolidated audited annual financial statements of the company and of the group, for the period ended 31 March 2016,

incorporating the directors’ report, the Audit Committee report and the auditor’s report, have been distributed as required and will

be presented to shareholders as required in terms of section 30(3)(d) of the Companies Act.

REPORT OF THE SOCIAL, ETHICS AND TRANSFORMATION COMMITTEEIn accordance with Companies Regulation 43(5)(c), issued in terms of the Companies Act, the chairman of the Social, Ethics and

Ethics Committee will table a report to shareholders, as contained in the integrated annual report, at the annual

general meeting.

1. Ordinary resolution number 1Re-election of directors who retire by rotation “RESOLVED that shareholders re-elect by way of series of votes, the following directors who retire by rotation in terms of article

26.6.1 of the company’s MOI, and who, being eligible, have offered themselves for re-election:

1.1 Coenraad Petrus Bester

1.2 Nondumiso Medupe”

Brief curricula vitae in respect of each director offering him/herself for re-election are contained on pages 36 to 39 of the

integrated annual report.

The percentage of voting rights that will be required for this resolution to be adopted is more than 50% of the votes exercised on the resolution.

2. Ordinary resolution number 2Reappointment of external auditor“RESOLVED that shareholders authorise the board to reappoint PricewaterhouseCoopers (“PwC”), 2 Eglin Road, Sunninghill 2157,

South Africa, as the independent external auditors and Peta-Lynn Pope as the individual designated auditor of the company for

the ensuing year and to determine the remuneration of the auditors.”


NOTICE OF ANNUAL GENERAL MEETING


2016129

3. Ordinary resolution number 3Re-election of Audit and Risk Committee “RESOLVED that shareholders re-elect, each by way of a separate vote, the following four independent non-executive directors, as members of the Ansys Audit and Risk Committee, with effect from the end of this annual general meeting until the conclusion of the next annual general meeting of the company:3.1 Nondumiso Medupe (Chairman)3.2 Sizakele Petunia Mzimela 3.3 Coenraad Petrus Bester3.4 Dr Snowy Joyce Khoza.”

Brief curricula vitae of these directors offering themselves for election as members of the Ansys Audit and Risk Committee are included in the report on pages 36 to 39 of the integrated annual report.


4. Ordinary resolution number 4Endorsement of Ansys remuneration policy“RESOLVED that shareholders endorse, by way of a non-binding advisory vote, the company’s remuneration policy (excluding the remuneration of the non-executive directors and the members of board committees for their services as directors and members of committees), as set out in the integrated annual report on page 63.”


5. Ordinary resolution number 5General authority to directors to allot and issue authorised but unissued ordinary shares“RESOLVED that the authorised but unissued shares in the capital of the company be and are hereby placed under the control and authority of the directors of the company and that the directors of the company be and are hereby authorised and empowered to allot, issue and otherwise dispose of such shares to such person or persons on such terms and conditions and at such times as the directors of the company may from time to time and in their discretion deem fit, subject to the provisions of the Companies Act, the MOI of the company and the JSE Listings Requirements, when applicable, such authority to remain in force until the next annual general meeting.”


6. Ordinary resolution number 6General authority to issue shares for cash“RESOLVED that the directors are hereby authorised as a general authority to allot and issue the authorised but unissued shares in the capital of the company, for cash, subject to the Companies Act, the MOI of the company and the JSE Listings Requirements, provided that:(a) the equity securities be of a class already in issue or, where this is not the case, must be limited to such securities or rights

that are convertible into a class already in issue;(b) the equity securities must be issued to public shareholders, as defined in the JSE Listings Requirements, and not to

related parties; (c) the equity securities which are the subject of a general issue for cash: (1) may not exceed 50% of the company’s listed equity securities as at the date of the passing of the notice of the annual

general meeting limited to 230 519 160 shares seeking the general issue for cash authority, provided that: (i) the authority shall be valid until Ansys’ next annual general meeting, or for 15 months from the date on which the

general issue for cash ordinary resolution was passed, whichever period is shorter, subject to the requirements of the JSE and to any other restrictions set out in this authority;

(ii) the calculation of the company’s listed equity securities must be a factual assessment of the company’s listed equity securities as at the date of the this annual general meeting, excluding treasury shares;

(iii) any equity securities issued under the authority during the period contemplated in (c)(1)(i) above must be deducted from such number in (1) above; and

(iv) in the event of a sub-division or consolidation of issued equity securities during the period contemplated in (c)(1)(i), the existing authority must be adjusted accordingly to represent the same allocation ratio;


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NOTICE OF ANNUAL GENERAL MEETING CONTINUED

6. Ordinary resolution number 6 continuedGeneral authority to issue shares for cash continued(d) the maximum discount at which equity securities may be issued is 10% of the weighted average traded price of such equity

securities measured over the 30 business days prior to the date that the price of the issue is agreed between the company and the party subscribing for the securities. The JSE should be consulted for a ruling if the applicant’s securities have not traded in such 30-business day period;

(e) a Securities Exchange News Service (“SENS”) announcement giving full details, including the impact on net asset value, net tangible asset value, earnings and headline earnings per share will be published at the time of any issue representing, on a cumulative basis within a financial year, 5% or more of the number of securities in issue prior to the issue; and

(f) this authority includes any options/convertible securities that are convertible into an existing class of equity securities.”

In terms of the JSE Listings Requirements, the approval of a 75% majority of the votes cast by shareholders present or represented by proxy at this annual general meeting will be required for this authority to become effective.

7. Ordinary resolution number 7Authority to sign all required documents“RESOLVED that, subject to the passing of the ordinary and special resolutions at the meeting, any director of the company or the Company Secretary shall be and is hereby authorised to sign all documents and perform all acts which may be required to give effect to such ordinary and special resolutions.”

The percentage of voting rights that will be required for this resolution o be adopted is more than 50% of the votes exercised on the resolution.

8. Special resolution number 1General authority to acquire (repurchase) shares“RESOLVED that the company be and is hereby authorised by way of a specific approval as contemplated in section 48 of the Companies Act, to acquire from time to time any or all of the issued ordinary shares of the company, upon such terms and conditions and in such amounts as the directors of the company may from time to time determine, but subject to the MOI of the company and the provisions of the Companies Act, when applicable and provided:That the company and/or any subsidiary of the company is hereby authorised, by way of a general authority, from time to time, to acquire ordinary shares in the share capital of the company, provided that:• Any such acquisition of ordinary shares shall be effected through the order book operated by the JSE trading system and done

without any prior understanding or arrangement with the counterparty;• This general authority shall be valid until the earlier of the company’s next annual general meeting or the variation or

revocation of such general authority by special resolution at any subsequent general meeting of the company, provided that it shall not extend beyond 15 months from the date of passing of this special resolution number 1;

• An announcement will be published as soon as the company or any of its subsidiaries have acquired ordinary shares constituting, on a cumulative basis, 3% of the number of ordinary shares in issue and for each 3% in aggregate of the initial number acquired thereafter, in compliance with paragraph 11.27 of the JSE Listings Requirements;

• Acquisitions of shares in aggregate in any one financial year may not exceed 20% of the company’s ordinary issued share capital, as the case may be, as at the date of passing of this special resolution number 1;

• Ordinary shares may not be acquired at a price greater than 10% above the weighted average of the market value at which such ordinary shares for the five business days immediately preceding the date the transaction is effected. The JSE should be consulted for a ruling if the company’s securities have not traded in such five business day period;

• The board of directors authorises the acquisition, the company passes the solvency and liquidity test and that from the time that the test is done, there are no material changes to the financial position of the company;

• The company has been given authority by its MOI;• At any point in time, the company and/or its subsidiaries may only appoint one agent to effect any such acquisition;• The company and/or its subsidiaries undertaking that they will not enter the market to so acquire the company’s shares until

the company’s Designated Advisor has provided written confirmation to the JSE regarding the adequacy of the company’s working capital in accordance with Schedule 25 of the JSE Listings Requirements;

• A resolution has been passed by the board of directors confirming that the board has authorised the general repurchase, that the company passed the solvency and liquidity test and that since the test was done, there have been no material changes to the financial position of the group; and

• The company and/or its subsidiaries not acquiring any shares during a prohibited period, as defined in the JSE Listings Requirements unless a repurchase programme is in place, where dates and quantities of shares to be traded during the prohibited period are fixed and full details of the programme have been disclosed in an announcement over SENS prior to the commencement of the prohibited period.”


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8 . Special resolution number 1 continuedGeneral authority to acquire (repurchase) shares continuedAlthough no such repurchases are currently in contemplation, the directors undertake that they will not effect a general repurchase of shares as contemplated above unless the following can be met:• The company and the group would in the ordinary course of their business be able to pay their debts;• The consolidated assets of the company and the group would exceed the consolidated liabilities of the company and the group

respectively, such assets and liabilities being fairly valued and recognised and measured in accordance with the accounting policies used in the financial statements contained in the integrated annual report;

• The issued capital and reserves of the company and the group would be adequate for the purposes of the company and the group’s business; and

• The company and the group’s working capital would be sufficient for their requirements.


Reason and effect of special resolution number 1The reason and effect of special resolution number 1 is to grant the company general approval to acquire its own issued shares on such terms, conditions and such amounts determined from time to time by the directors of the company by the limitations set out above.

Pursuant to and in terms of the JSE Listings Requirements, the directors of the company hereby state:• The directors of the company have no specific intention to effect the provisions of special resolution number 1 but will,

however, continually review this position having regard to prevailing circumstances.• The intention of the company and/or its subsidiaries is to utilise the general authority to repurchase; if at some future date the

cash resources of the company are in excess of its requirements.• The method by which the company and any of its subsidiaries intends to repurchase its securities and the date on which such

repurchase will take place, has not yet been determined

The JSE Listings Requirements require, the following disclosures, which appear in the integrated annual report:• Directors and management – refer to pages 32 to 39 of the integrated annual report.• Major shareholders – refer to page 126 of the integrated annual report.• Directors’ interests in securities – refer to page 75 of the integrated annual report.• Share capital of the company – refer to page 110 of the integrated annual report.

Litigation statementThe directors, whose names appear on pages 32 to 39 of the integrated annual report of which the notice of annual general meeting forms part, are not aware of any legal or arbitration proceedings that are pending or threatened, that may have or had in the recent past, being at least the previous 12 months, a material effect on the Ansys group’s financial position.

Directors’ responsibility statementThe directors, whose names appear on pages 32 to 39 of the integrated 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 statements false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that this special resolution contains all information required by law and the JSE Listings Requirements.

Material changesOther than the facts and developments reported on in the integrated annual report, there have been no material changes in the financial or trading position of the company and its subsidiaries since the date of signature of the audit report and up to the date of the notice of annual general meeting.

The directors have no specific intention, at present, for the company or its subsidiaries to acquire any of the company’s shares but consider that such a general authority should be put in place should an opportunity present itself to do so during the year, which is in the best interests of the company and its shareholders.

The directors are of the opinion that it would be in the best interests of the company to extend such general authority and thereby allow the company or any of its subsidiaries to be in a position to acquire the shares issued by the company through the order book of the JSE, should the market conditions, tax dispensation and price justify such an action.

The percentage of voting rights that will be required for this resolution to be adopted is more than 75% of the votes exercised on

the resolution.


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9. Special resolution number 2: Remuneration of non-executive directors

“RESOLVED that the board and committee fees for non-executive directors for the financial period ended 31 March 2016, as set

out in the note below, be and are hereby authorised, in accordance with section 66 (8) – (9) of the Companies Act and that the

company may continue to pay directors’ fees at the annual rates specified in the note below, for the period from 31 March 2016

until the company’s 2017 annual general meeting.”

PROPOSED2017 FEES

AnnualisedR

BoardLead independent non-executive director – Retainer 372 600 Members – Retainer 162 644

Audit and Risk CommitteeChairman – Retainer 47 084 Members – Retainer 34 244

Social and Ethics CommitteeChairman – Retainer 25 680 Members – Retainer 17 116

Human Capital and Remuneration CommitteeChairman – Retainer 25 680 Members – Retainer 17 156

The Human Capital and Remuneration Committee (“HC&R”) relied on a salary benchmark and survey from the Deloitte

Non-Executive Director’s Survey Report 2016, an independent third party, to determine whether the non-executive directors fees

presented to shareholders for approval, were in line with market trends. Further to the aforementioned, the HC&R was desirous

of determining whether the non-executive directors fees were aligned with the Remuneration philosophy and policy of the

company. In this regard, shareholders are reminded that part of the philosophy is to remunerate employees and directors fairly

and market related in order to retain the necessary skill and expertise required.

The non-executive directors, other than the chairman of the board, were in the past remunerated on a monthly retainer as

well as attendance fee per meeting. It is now proposed that non-executive directors, similar to the chairman of the board,

should receive monthly remuneration as opposed to a fee per meeting. This recognises the responsibility of directors for

the efficient control of the company and creates the expectation that the non-executive directors will attend every board or

committee meeting. A premium is payable to the chairman of the board, as well as to the chairmen of the subcommittees.

For ease of reference and comparison to the previous non-executive directors fees paid, please see page 115 of the annual

financial statements.

The percentage of voting rights that will be required for this resolution to be adopted is more than 75% of the votes exercised

on the resolution.

Reason and effect of special resolution number 2

The Companies Act requires shareholder approval of directors’ fees prior to payment of such fees.

10. Special resolution number 3

General approval to provide financial assistance for subscription or purchase of securities in related or inter-related entities in

terms of Section 44 of the Companies Act

“RESOLVED as a special resolution that in terms of and subject to the provisions of section 44 of the Companies Act,

the shareholders of the company hereby approve, as a general approval, the giving by the company of financial assistance,

by way of a loan, guarantee, the provision of security or otherwise to any person for the purpose of, or in connection with,

the subscription of any option, or any securities, issued or to be issued by the company or any affiliate, or for the purchase of

any securities of the company or its affiliates (including, without limitation, the giving of a guarantee to any subscriber, holder



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10. Special resolution number 3 continued

General approval to provide financial assistance for subscription or purchase of securities in related or inter-related entities in

terms of Section 44 of the Companies Act continued

or purchaser of preference shares in any affiliate, as security for such affiliate’s obligations under such preference shares),

as set out in section 44 of the Companies Act, which approval shall be valid for a period of 2 (two) years from the date this

special resolution is passed.

The shareholders of the company hereby resolve that the board may, subject to compliance with the requirements of the

Memorandum of Incorporation, the Companies Act and the JSE Listings Requirements, each as presently constituted and

as amended from time to time, authorise the company to provide financial assistance as contemplated in section 44 of the

Companies Act, on such terms and conditions and for such amounts as the board may determine.

It is hereby noted that the company may from time to time provide financial assistance in terms of section 44 of the Companies

Act, by way of a loan, guarantee, the provision of security or otherwise to any person for the purpose of, or in connection with,

the subscription of any option, or any securities, issued or to be issued by the company or a related or inter-related company (as

contemplated in the Companies Act, including, without limitation, any present or future subsidiaries of the company, its holding

company and subsidiaries of its holding company and/or any other company or corporation that is or becomes related or inter-

related to the company) (collectively for purposes of this resolution, the “affiliates”), or for the purchase of any securities of the

company or its affiliates, on such specific terms as may be authorised by the board.

It is further noted that the board of directors of the company shall not authorise any financial assistance contemplated in such

special resolution unless the board:

1. is satisfied that immediately after providing the financial assistance, the company will satisfy the solvency and liquidity test

contemplated in section 4 of the Companies Act (read with section 44(3)(b)(i));

2. is satisfied that the terms under which the financial assistance is proposed to be given are fair and reasonable to the

company (section 44(3)(b)(ii)); and

3. is satisfied any applicable conditions or restrictions respecting the granting of financial assistance set out in the company’s

memorandum of incorporation have been satisfied (section 44(4)).

In compliance with the requirements of the Companies Act, the board is seeking a general authority from shareholders to

cause the company to provide financial assistance for subscription and purchase of securities as set out in section 44 of the

Companies Act.

Reason and effect of special resolution number 3

The reason for special resolution number 3 is to grant the board a general authority in terms of the Act to cause the company

to provide financial assistance by way of a loan, guarantee, the provision of security or otherwise to any person for the purpose

of, or in connection with, the subscription of any option, or any securities, issued or to be issued by the company or any affiliate,

or for the purchase of any securities of the company or its affiliates, as set out in section 44 of the Act in such amounts and on

such terms and conditions as may be determined by the board. The passing of special resolution number 3 will have the effect

that the board will have the flexibility, subject to the requirements of the memorandum of incorporation, the Companies Act,

the Listings Requirements and the requirements of any other stock exchange upon which the shares of the company may be

quoted or listed from time to time, to provide financial assistance as set out in section 44 of the Companies Act should it be in

the interests of the company to do so. This general authority shall be valid for a period of 2 (two) years from the date of approval

of this special resolution unless such general authority is varied or revoked by special resolution of shareholders prior to the

expiry of such 2 (two) year period.

The percentage of voting rights that will be required for this resolution to be adopted is more than 75% of the votes exercised on

the resolution.


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11. Special resolution number 4Direct or indirect financial assistance (‘financial assistance’ will herein have the meaning attributed to it in section 45(1) of the Companies Act) to any company related or inter-related to the company or to any juristic person who is a member of or related to any such companies “RESOLVED as a special resolution that and a general approval, the company may, in terms of section 45(3)(a)(ii) of the Companies Act and subject to compliance with the remainder of section 45 of the Companies Act, provide any direct or indirect financial assistance that the board of directors of the company may deem fit to any related or inter-related company or to any juristic person who is a member of or related to any such companies (‘related’ and ‘inter-related’ will herein have the meaning so attributed in section 2 of the Companies Act) (on the terms and conditions, to the recipient/s, in the form, nature and extent, and for the amounts that the board of directors of the company may determine from time to time).”

Reason and effect of special resolution number 4The reason for and effect of special resolution number 4, if adopted, will be to confer authority on the board of directors of the company to authorise financial assistance to companies related or inter-related to the company, or to any juristic person who is a member of or related to any such companies generally as the board of directors of the company may deem fit, on the terms and conditions, and for the amounts that the board of directors may determine from time to time, for a period of two years after this general meeting of the company.

The granting of the general authority would obviate the need to refer each instance of provision of financial assistance in the circumstances contemplated in this special resolution for ordinary shareholder approval.

This general authority would assist the company with, inter alia, making inter-company loans to subsidiaries of the company, or inter-related companies, as well as granting letters of support and guarantees in appropriate circumstances. This would avoid undue delays and attendant adverse financial impact on subsidiaries, or inter-related companies, as it would facilitate the expeditious conclusion of negotiations.

In the event that this special resolution is adopted by the ordinary shareholders of the company, thereby conferring general authority on the board of directors of the company to authorise financial assistance to companies related or inter-related to the company or to any juristic person who is a member of or related to any such companies, then the board of directors of the company shall not authorise any financial assistance contemplated in such special resolution unless the board:1. is satisfied that immediately after providing the financial assistance, the company will satisfy the solvency and liquidity test

contemplated in section 4 of the Companies Act (section 45(3)(b)(i)); and 2. is satisfied that the terms under which the financial assistance is proposed to be given are fair and reasonable to the company

(section 45(3)(b)(ii)); and 3. has ensured that any conditions or restrictions in respect of the granting of financial assistance set out in the company’s

memorandum of incorporation have been satisfied (section 45(4)).

This special resolution does not authorise the provision of financial assistance to a director or prescribed officer of the company

The percentage of voting rights that will be required for this resolution to be adopted is at least 75% of the votes exercised on the resolution.

12. Special resolution number 5Amendment to the memorandum of incorporation (“MOI”) of the company “RESOLVED as a special resolution that the memorandum of incorporation of the company be hereby amended by:– the deletion of the existing clause 17.7 in its entirety and the substitution therefor with the following new clause 17.7:

“If a fractional entitlement arise as a result of any action contemplated in clause 17 or any other corporate action, the JSE Listing Requirements applicable to fractional shares must be applied. The company must release an announcement in respect of the cash value determined on the date and if so required by the JSE.”

Reason for and effect of special resolution number 5The reason for special resolution number 5 is to obtain the required approval from shareholders to amend the MOI of the company in the manner that aligns the MOI with the recent amendments to the JSE Listings Requirements.

The effect of special resolution number 5 is that the company will have the necessary authority to amend the MOI in the manner set out in special resolution number 5, which amendments have also been approved by the JSE.

The percentage of voting rights that will be required for this resolution to be adopted is at least 75% of the votes exercised on the resolution.



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VOTING INSTRUCTIONSIn terms of the Companies Act, any member entitled to attend and vote at the above meeting may appoint one or more persons as

proxy, to attend and speak and vote in his stead. A proxy need not be a member of the company. Forms of proxy must be deposited

at the office of the transfer secretaries not later than 1 November 2016 before the time fixed for the meeting (excluding Saturdays,

Sundays and public holidays).

If your Ansys shares have been dematerialised and are held in a nominee account, then your Central Securities Depository

Participant (“CSDP”) or broker, as the case may be, should contact you to ascertain how you wish to cast your vote at the annual

general meeting and thereafter cast your vote in accordance with your instructions.

If you have not been contacted it would be advisable for you to contact your CSDP or broker, as the case may be, and furnish them

with your instructions. If your CSDP or broker, as the case may be, does not obtain instructions from you, they will be obliged to act in

terms of your mandate furnished to them, or if the mandate is silent in this regard to abstain from voting.

Dematerialised shareholders whose shares are held in a nominee account must not complete the attached form of proxy.

Unless you advise your CSDP or broker timeously in terms of the agreement between yourself and your CSDP or broker by the cut-off

time advised by them that you wish to attend the annual general meeting or send a proxy to represent you at the annual general

meeting, your CSDP or broker will assume you do not wish to attend the annual general meeting or send a proxy. If you wish to

attend the annual general meeting, your CSDP or broker will issue the necessary letter of representation to you to attend the annual

general meeting.

Shareholders who have dematerialised their shares through a CSDP or broker, other than “own name” registered dematerialised

shareholders, who wish to attend the annual general meeting, must request their CSDP or broker to issue them with a letter of

representation, or they must provide the CSDP or broker with their voting instructions in terms of the relevant custody agreement/

mandate entered into between them and the CSDP or broker.

SHAREHOLDER RIGHTSIt is requested that forms of proxy should be forwarded to reach the company’s transfer secretaries at the address given below by

no later than Tuesday, 1 November 2016 at 10:00.

In terms of section 63 (2) and 63 (3) of the Companies Act, shareholders or their proxies may participate in the meeting by way of

telephone conference call and, if they wish to do so:

• must contact the Company Secretary (by email at the address [email protected]) by no later than Tuesday,

1 November 2016 at 10:00 in order to obtain a pin number and dial-in details for that conference call;

• will be required to provide reasonably satisfactory identification; and

• will be billed separately by their own telephone service providers for their telephone call to participate in the meeting.

By order of the board

MELINDA GOUSREPRESENTATIVE OF: FUSION CORPORATE SECRETARIAL SERVICES PROPRIETARY LIMITED


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EXPLANATORY NOTES TO THE NOTICE OF ANNUAL GENERAL MEETING AND PROPOSED RESOLUTIONS1. Re-election and rotation of directors

The rotation of directors is fully governed in terms of articles 26.6.1 of the MOI of the company, which require one third of the

directors to retire from office at the annual general meeting. The retiring directors at each annual general meeting shall be

those who have been longest in office since their last election or appointment. If at the date of the annual general meeting any

director will have held office for a period of three years since his last election or appointment he shall retire at such meeting

either as one of the directors to retire in pursuance of the foregoing or additionally thereto. A retiring director shall act as a

director throughout the meeting at which he retires. The retiring directors shall be eligible for re-election. Coenraad Petrus Bester

and Nondumiso Medupe offer themselves for re-election.

2. Re-appointment of external auditorThe Audit and Risk Committee having considered and assessed the independence of the external auditor, reappoint

PricewaterhouseCoopers, 2 Eglin Road, Sunninghill, 2157, South Africa in accordance with section 90 of the Companies Act.

The Audit and Risk Committee was satisfied with PricewaterhouseCoopers South Africa Incorporated’s independence. Furthermore,

the Ansys Audit and Risk Committee has, in terms of paragraph 3.86 of the JSE Listings Requirements, considered and satisfied

itself that Peta-Lynn Pope, the reporting accountant and individual auditor, is accredited to appear on the JSE List of Accredited

Auditors, in compliance with section 22 of the JSE Listings Requirements. The Audit and Risk Committee nominated to appoint

PricewaterhouseCoopers South Africa Incorporated as the registered auditor for the 2016 financial year, with Peta-Lynn Pope

as the individual designated auditor of the company for the ensuing year. The board has accepted the recommendation of the

Audit and Risk Committee subject to shareholder approval as required in terms of section 90(1) of the Companies Act.

The auditors will remain the appointed auditors until the conclusion of the next annual general meeting of the company.

The remuneration of the auditors shall be fixed by agreement with the company.

3. Election of Audit committee membersIn terms of section 94(2) of the Companies Act, the company must elect an Audit committee comprising at least three members.

The Audit committee is no longer a committee of the board, but a committee elected by the shareholders at each annual general

meeting. The proposed members of the Audit committee have experience in audit, accounting, economics, human resources,

commerce and general industry, among others.

The board confirms that Nondumiso Medupe (Chairman), Sizakele Petunia Mzimela, Coenraad Petrus Bester and

Dr Snowy Joyce Khoza are independent non-executive directors as contemplated in the King III Code of Governance Principles

for South Africa and the JSE Listings Requirements. Each member of the Audit and Risk Committee of the company is a suitably

qualified and skilled director of the company. The members of the committee are not involved in the day-to-day management of

the business or have not been so involved at any time of the previous financial year. None of the members are a prescribed officer

or full-time employee of the company or another related or inter-related company, or have been such an officer or employee at

any time during the previous three financial years. None of the members were a material supplier or customer of the company.

4. Endorsement of Ansys’s remuneration policyThe endorsement of Ansys’s remuneration policy is of an advisory nature only and failure to pass this resolution will therefore

not have any legal consequences relating to existing arrangements. However, the board will take the outcome of the vote into

consideration when considering the company’s remuneration policy in the remuneration of executive directors.

5. General authority to directors to allot and issue authorised but unissued ordinary sharesIn terms of the company’s MOI, the board might with the prior approval of the company in general meeting, subject to the

statutes and the approval of the Listings Division of the JSE (where necessary), issue authorised but unissued shares in the

company to such person or persons on such terms and conditions and with such rights or restrictions attached thereto as the

directors may determine.

The existing general authorities granted by the shareholders at the previous annual general meeting, held 9 September 2015,

will expire at the annual general meeting to be held on 3 November 2016 unless renewed. The authorities will be subject to the

Companies Act and the JSE Listings Requirements. The aggregate number of ordinary shares able to be allotted and issued in

terms of these authorities are limited as set out in the respective resolutions.



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5. General authority to directors to allot and issue authorised but unissued ordinary shares continuedThe directors request shareholder approval for the renewal of these authorities as it would be advantageous for the business to make use of the authority if opportunities arise.

6. General authorisation to issue shares for cashThis enables the directors to issue shares for cash.

7. Authority to sign all required documentsThis requests authority to be given to a director or the Company Secretary to sign such documents and execute such actions as will be required to register and give effect to the resolutions passed.

8. General authority to acquire (repurchase) sharesThis is to grant the company and its subsidiaries a general authority to facilitate the acquisition by the company and/or its subsidiaries of the company’s own shares, which general authority shall be valid until the earlier of the next annual general meeting of the company, provided that this general authority shall not extend beyond 15 months from the date of the passing of this special resolution number 1.

9. Remuneration of non-executive directorsIn terms of section 66(8) – (9) of the Companies Act, remuneration may only be paid to directors, for their service as directors, in accordance with a special resolution approved by the shareholders within the previous two years and if not prohibited in terms of a company’s MOI.

10. Financial assistance in terms of section 44 and 45 of the Companies Act (Point 10 and 11 of the Notice of AGM)Notwithstanding the title of section 45 of the Act, being “Loans or other financial assistance to directors”, on a proper interpretation thereof, the body of the section also applies to any financial assistance provided by a company to any related or inter-related company or corporation, a member of a related or inter-related corporation, and to a person related to any such company, corporation or member.

Further, Section 44 of the Act may also apply to any financial assistance so provided by a company to any related and inter-related company or corporation, a member, in the event that the financial assistance is provided for the purpose of, or in connection with, the subscription of any option, or any securities, issued or to be issued by the company or a related or inter-related company, or a purchase of any securities of the company or a related or inter-related company.

Both sections 44 and 45 of the Act provide that the particular financial assistance must be provided only pursuant to a special resolution of shareholders, adopted within the previous 2 (two) years, which approved such assistance either for a specific recipient or generally for a category of potential recipients, and the specific recipient falls within the general recipients and the board is satisfied that: i) immediately after providing the financial assistance, the company would satisfy the solvency and liquidity test (as

contemplated in the Act); and ii) the terms under which the financial assistance is proposed to be given are fair and reasonable to the company.

As part of the normal conduct of the business of the group, the company, and its subsidiaries are periodically required to: i) provide financial assistance (as understood in terms of section 45 of the Act) to any of their directors or prescribed officers,

their present or future subsidiaries, and/or to any related or inter-related company or corporation, and/or to a member of a related or interrelated corporation, and furthermore

(ii) to provide financial assistance (as understood in terms of section 44 of the Act) to any person for the purpose of or in connection with the subscription of any option or any securities issued or to be issued by the company or another company related or inter-related to it.

Under the Act, the company will require the special resolution referred to above to be adopted. It is therefore imperative that the company obtains the approval of shareholders in terms of Special resolution numbers 4 and 5 so that it is able to effectively organise its internal financial administration.

11. Change in MOIThe recommended change in the MOI of the company is to align the MOI with the recent amendments to the JSE Listings Requirements.


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SHAREHOLDERS DIARY

Financial year end 2016 31 March 2016

Announcement of the 12 months results for the period ending 29 February 2016 30 May 2016

Announcement of the annual results for the period ending 31 March 30 June 2016

2016 integrated report published 30 September 2016

2016 integrated report posted 30 September 2016

Annual general meeting 3 November 2016

Interim half-year to September 2016 December 2016


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FORM OF PROXYANSYS LIMITED(Incorporated in the Republic of South Africa) (Registration number: 1987/001222/06) (“Ansys” or “the company”)ISIN code: ZAE 000097028 Share code: ANS

Form of proxy for the annual general meeting to be held in the Ansys boardroom, 140 Bauhinia Street, Highveld Techno Park, Centurion on 3 November 2016 at 10:00 – for use by certificated ordinary shareholders and dematerialised ordinary shareholders with “own name” registration only.

Holders of dematerialised ordinary shares other than “own name” registration must inform their CSDP or broker of their intention to attend the annual general meeting and request their CSDP to issue them with the necessary authorisation to attend the annual general meeting in person or provide their CSDP of broker with their voting instructions should they not wish to attend the annual general meeting in person but wish to be represented thereat.

I/We (please print names in full)

of (address)

Being the registered holder(s) of ordinary shares in the capital of the company do hereby appoint

1. or failing him/her

2. or failing him/her

the chairman of the annual general meeting as my/our proxy to act on my/our behalf at the annual general meeting of the company which will be held on 3 November 2016 for the purpose of considering and, if deemed fit, passing, with or without modification, the resolutions to be proposed thereat and at any adjournment thereof, and to vote for and/or against the resolutions and/or abstain from voting in respect of the shares registered in my/our name/s, in accordance with the following instructions:

Please indicate with an “X” in the appropriate spaces provided above how you wish your vote to be cast. If no indication is given, the proxy will be entitled to vote or abstain as he/she deems fit.

Number of ordinary shares

For Against Abstain

1. Ordinary resolution number 1: Re-election of directors who retire by rotation:


1.2 Nondumiso Medupe

2. Ordinary resolution number 2: Reappointment of external auditor

3. Ordinary resolution number 3: Re-election of Audit and Risk Committee

3.1 Nondumiso Medupe (Chairman)

3.2 Sizakele Petunia Mzimela


3.4 Dr Snowy Joyce Khoza

4. Ordinary resolution number 4: Endorsement of Ansys remuneration policy

5.Ordinary resolution number 5: General authority to directors to allot and issue authorised but unissued ordinary shares

6. Ordinary resolution number 6: General authority to issue shares for cash

7. Ordinary resolution number 7: Authority to sign documents

8. Special resolution number 1: General authority to acquire (repurchase) shares

9. Special resolution number 2: Remuneration of non-executive directors10. Special resolution number 3: General approval to provide financial assistance for subscription or

purchase of securities in related or inter-related entities in terms of Section 44 of the Companies Act11. Special resolution number 4: Direct or indirect financial assistance (‘financial assistance’ will herein

have the meaning attributed to it in section 45(1) of the Companies Act) to any company related or inter-related to the company or to any juristic person who is a member of or related to any such companies

12. Special Resolution Number 5: Amendment of Memorandum of Incorporation to align same with recent changes in the requirements of the JSE Limited.

Signed at on 2016

Signature

Assisted by me(where applicable)

Please read the notes on the reverse side hereof.

1. This form is for use by certificated shareholders and dematerialised shareholders with “own-name” registration whose shares are registered in their own names on the record date and who wish to appoint another person to represent them at the annual general meeting. If duly authorised, companies and other corporate bodies whose shareholders are having shares registered in their own names may appoint a proxy using this form, or may appoint a representative in accordance with the last paragraph below.

2. Other shareholders should not use this form. All beneficial holders who have dematerialised their shares through a CSDP or broker, and do not have their shares registered in their own name, must provide the CSDP or broker with their voting instructions. Alternatively, if they wish to attend the annual general meeting in person, they should request the CSDP or broker to provide them with a letter of representation in terms of the CSDP or broker.

3. This proxy form will not be effective at the annual general meeting unless sent to the transfer secretaries to be received by the transfer secretaries, Computershare Investor Services Proprietary Limited; Ground Floor 70 Marshall Street Johannesburg 2001 (PO Box 61051 Marshalltown 2107 South Africa) by no later than 10:00 on Tuesday, 1 November 2016 or such later date and time which might be released on SENS.

4. This proxy shall apply to all the ordinary shares registered in the name of shareholders at the record date unless a lesser number of shares is inserted.5. A shareholder may appoint one person as his proxy by inserting the name of such proxy in the space provided. Any such proxy need not be a shareholder of the

company. If the name of the proxy is not inserted, the chairman of the annual general meeting will be appointed as proxy. If more than one name is inserted, then the person whose name appears first on the form of proxy and who is present at the meeting will be entitled to act as proxy to the exclusion of any persons whose names follow. The proxy appointed in this proxy form may delegate the authority given to him in this proxy by delivering to the company, in the manner required by these instructions, a further proxy form which has been completed in a manner consistent with the authority given to the proxy of this proxy form.

6. Unless revoked, the appointment of proxy in terms of this proxy form remains valid until the end of the annual general meeting even if the annual general meeting or a part thereof is postponed or adjourned.

7. If: 7.1 A shareholder does not indicate on this instrument that the proxy is to vote in favour of or against or to abstain from voting on any resolution; or 7.2 The shareholder gives contrary instructions in relation to any matter; or 7.3 Any additional resolution/s which are properly put before the annual general meeting; or 7.4 Any resolution listed in the proxy form is modified or amended, the proxy shall be entitled to vote or abstain from voting, as he thinks fit, in relation to that

resolution or matter. If, however, the shareholder has provided further written instructions which accompany this form and which indicate how the proxy should vote or abstain from voting in any of the circumstances referred to in 7.1 to 7.4, then the proxy shall comply with those instructions.

8. If this proxy is signed by a person (signatory) on behalf of the shareholder, whether in terms of a power of attorney or otherwise, then this proxy form will not be effective unless:

8.1 It is accompanied by a certificated copy of the authority given by the shareholder or the shareholder to the signatory; or 8.2 The company has already received a certificated copy of that authority.9. The Chairman of the annual general meeting may, at his discretion, accept or reject any proxy form or other written appointment of a proxy which is received by the

Chairman prior to the time when the annual general meeting deals with a resolution or matter to which the appointment of the proxy relates, even if that appointment of a proxy has not been completed and/or received in accordance with these instructions. However, the Chairman shall not accept any such appointment of a proxy unless the Chairman is satisfied that it reflects the intention of the shareholder appointing the proxy.

10. Any alterations made in this proxy form must be initialled by the authorised signatory/ies.11. This proxy form is revoked if the shareholder who granted the proxy: 11.1 Delivers a copy of the revocation instrument to the company and to the proxy or proxies concerned, so that it is received by the transfer secretaries, Computershare

Investor Services Proprietary Limited; Ground Floor 70 Marshall Street Johannesburg 2001 (PO Box 61051 Marshalltown 2107 South Africa) by no later than 10:00 on Tuesday, 1 November 2016 or such later date and time which might be released on SENS; or

11.2 Appoints a later, inconsistent appointment of proxy for the annual general meeting; or 11.3 Attends the annual general meeting in person.12. If duly authorised, companies and other corporate bodies who are shareholders of the company having shares registered in their own name may, instead of completing

this proxy form, appoint a representative to represent them and exercise all of their rights at the annual general meeting by giving written notice of the appointment of that representative. This notice will not be effective at the annual general meeting unless it is accompanied by a duly certified copy of the resolution/s or other authorities in terms of which that representative is appointed and is received by the transfer secretaries, Computershare Investor Services Proprietary Limited; Ground Floor 701 Marshall Street Johannesburg 2001 (PO Box 61051 Marshalltown 2107 South Africa) by no later than 10:00 on Tuesday, 1 November 2016 or such later date and time which might be released on SENS.

ADDITIONAL FORMS OF PROXY ARE AVAILABLE FROM THE TRANSFER SECRETARIES ON REQUEST.

SUMMARY OF RIGHTS CONTAINED IN SECTION 58 OF THE COMPANIES ACT1. A shareholder may at any time appoint any individual, including a non-shareholder of the company, as a proxy to participate in, speak and vote at a shareholders’

meeting on his or her behalf (section 58(1) (a)), or to give or withhold consent on behalf of the shareholder to a decision in terms of section 60 (shareholders acting other than at a meeting) (section 58(1) (b)).

2. A proxy appointment must be in writing, dated and signed by the shareholder, and remains valid for one year after the date on which it was signed or any longer or shorter period expressly set out in the appointment, unless it is revoked in terms of paragraph 6.3 or expires earlier in terms of paragraph 10.4 below (section 58(2)).

3. A shareholder may appoint two or more persons concurrently as proxies and may appoint more than one proxy to exercise voting rights attached to different securities held by the shareholder (section 58(3) (a)).

4. A proxy may delegate his or her authority to act on behalf of the shareholder to another person, subject to any restriction set out in the instrument appointing the proxy (“proxy instrument”) (section 58(3)(b)).

5. A copy of the proxy instrument must be delivered to the company, or to any other person acting on behalf of the company, before the proxy exercises any rights of the shareholder at a shareholders’ meeting (section 58(3) (c)) and in terms of the memorandum of incorporation (“MOI”) of the company at least 48 hours before the meeting commences.

6. Irrespective of the form of instrument used to appoint a proxy: 6.1 The appointment is suspended at any time and to the extent that the shareholder chooses to act directly and in person in the exercise of any rights as a

shareholder (section 58)4) (a)); 6.2 The appointment is revocable unless the proxy appointment expressly states otherwise (section 58(4) (b)); and 6.3 if the appointment is revocable, a

shareholder may revoke the proxy appointment by cancelling it in writing or by making a later, inconsistent appointment of a proxy, and delivering a copy of the revocation instrument to the proxy and to the company (section 58(4) (c)).

7. The revocation of a proxy appointment constitutes a complete and final cancellation of the proxy’s authority to act on behalf of the shareholder as of the later of the date stated in the revocation instrument, if any, or the date on which the revocation instrument was delivered as contemplated in paragraph 6.3 above (section 58(5)).

8. If the proxy instrument has been delivered to a Company, as long as that appointment remains in effect, any notice required by the Companies Act or the company’s MOI to be delivered by the company to the shareholder must be delivered by the company to the shareholder (section 58(6)(a)), or the proxy or proxies, if the shareholder has directed the company to do so in writing and paid any reasonable fee charged by the company for doing so (section 58(6)(b)).

9. A proxy is entitled to exercise, or abstain from exercising, any voting right of the shareholder without direction, except to the extent that the MOI or proxy instrument provides otherwise (section 58(7)).

10. If a company issues an invitation to shareholders to appoint one or more persons named by the company as a proxy, or supplies a form of proxy instrument: 10.1 The invitation must be sent to every shareholder entitled to notice of the meeting at which the proxy is intended to be exercised (section 58(8) (a)); 10.2 The invitation or form of proxy instrument supplied by the company must: 10.2.1 Bear a reasonably prominent summary of the rights established in section 58 of the Companies Act (section 58(8) (b) (i)); 10.2.2 Contain adequate blank space, immediately preceding the name(s) of any person(s) named in it, to enable a shareholder to write the name, and if desired,

an alternative name of a proxy chosen by the shareholder (section 58(8)(b)(ii)); and 10.2.3 Provide adequate space for the shareholder to indicate whether the appointed proxy is to vote in favour of or against any resolution(s) to be put at the

meeting, or is to abstain from voting (section 58(8)(b)(iii)). 10.3 The company must not require that the proxy appointment be made irrevocable (section 58(8) (c)); and 10.4 The proxy appointment remains valid only until the end of the meeting at which it was intended to be used, subject to paragraph 7 above (section 58(8)(d).

NOTES TO THE FORM OF PROXY


2016141

ANSYS LIMITED(Incorporated in the Republic of South Africa)

(Registration number: 1987/001222/06)

(“Ansys” or “the company”)

ISIN code: ZAE 000097028

Share code: ANS

To:

The Directors

Ansys Limited

I/We , the undersigned(please print names in full)

of (address)

Being the registered holder(s) of ordinary shares in the capital of the company do hereby

elect to receive any documents or notices from Ansys, by electronic post, to the extent that the company is permitted to so distribute

any notices, documents, records or statements in terms of the Companies Act 71 of 2008, as amended, and any and every other

statute, ordinance, regulation or rule in force from time to time, including the Listings Requirements of the JSE Limited, concerning

companies and affecting Ansys.

I/We hereby furnish the following email address and/or fax number for such electronic communication:

Email address

Fax number

Any written amendment or withdrawal of any such notice of consent by me/us, shall only take effect if signed by me/us and

received by the company.

Signed at on 2016

Signature

Assisted by me

(where applicable)

Please complete, detach and return this election form to Ansys’ Company Secretary, Fusion Corporate Secretarial Services

Proprietary Limited, PO Box 68528, Highveld, 0169 or email to [email protected] by no later than Tuesday,

1 November 2016 at 10:00.

ELECTION FORM


2016143

GENERAL DEFINITIONS

“AltX” Alternative Exchange of the JSE Limited, on which Ansys listed in 2007

“Ansys” or “the company” or “the group”

Ansys Limited (Reg no. 1987/001222/06), listed on the JSE’s AltX

“B-BBEE” Broad-Based Black Economic Empowerment

“CEO” Group Chief Executive Officer: Ansys Limited’s CEO is Teddy Daka (appointed 4 June 2013)

“CFO” Group Chief Financial Officer: Ansys Limited’s CFO is Burt Lamprecht (appointed 1 April 2016)

“CIDB” Construction Industry Development Board

“CIO” Chief Information Officer

“CSI” Corporate social investment

“DEKRA” An international company providing safety and quality certification for companies dealing with technology, the environment and mobility.

“EIA” Environmental impact assessments

“EME” Exempted Micro Enterprises

“EMS” Electronic Contract Manufacturing Services

“EXCO” Executive Committee of Ansys Limited

“FTTx” Fibre to (x) building, home and/or curb

“HR” Human Resources

“IAR” Integrated annual report

“IBC” Inside back cover (of this integrated annual report)

“IFC” Inside front cover (of this integrated annual report)

“IP” Intellectual property

“ISO” International Standards Organisation

“IT” Information Technology

“JSE” JSE Limited incorporating the Johannesburg Securities Exchange, the main bourse in South Africa, and AltX

“King III Report” or “King III” King Report on Corporate Governance for South Africa, 2009

“KPIs” Key performance indicators – a set of quantifiable measures that a company or industry uses to gauge or compare performance in terms of meeting its strategic and operational goals

“MD” Managing Director

“MOI” Memorandum of incorporation

“NEPAD” New Partnership for Africa’s Development

“NOSA” NOSA provides occupational health, safety and environmental risk management services and solutions and is the exclusive provider of both the NOSA Five Star Grading System and SAMTRAC

“ODM” Original design manufacturer

“OEM” Original equipment manufacturer

“Parsec” or “Parsec Holdings” Parsec Holdings Proprietary Limited

“PRASA” Passenger Rail Association of South Africa

“QMS” Quality Management System

“QSE” Qualifying Small Enterprise

“Quadsoft” Quadsoft Proprietary Limited, subsidiary of Ansys Limited that is dormant

“Redline” or “Redline Telecommunications”

Redline Telecommunications SA Proprietary Limited

“R&D” Research and development

DEFINITIONS


2016144

“SABS” South African Bureau of Standards

“SAICA” South African Institute of Chartered Accountants

“SENS” The JSE’s real-time news dissemination service

“SERC” Social, Ethics and Remuneration Committee

“SHEQ” Safety, Health, Environment and Quality

“Tedaka” Tedaka Network Solutions Proprietary Limited, previously Tedaka Technologies Proprietary Limited

“telecoms” Telecommunications sector (fixed line and mobile)

“the board” The board of directors of Ansys Limited, as set out on page 32 to 39

“the code” Corporate Practices and Conduct

“the Companies Act” South African Companies Act 71 of 2008, as amended

“the current year” The year ending 31 March 2017

“the group” Ansys Limited and its subsidiaries

“the IODSA” Institute of Directors in South Africa

“the previous year” The year ended 29 February 2015

“the period” or

“the period under review” The period ended 31 March 2016

FINANCIAL DEFINITIONS

“EBITDA” Earnings before interest, taxation, depreciation and amortisation

“FY” Financial year, for Ansys ending 31 March

“GDP” Gross domestic product

“HEPS” Headline earnings per share

“IFRS” International Financial Reporting Standards

“PAT” Profit after tax

“ROI” Return on investment

DEFINITIONS CONTINUED

designed by seption.co.za

CONTACTS

REGISTERED OFFICE AND PRINCIPAL PLACE OF BUSINESS

140 Bauhinia Street, Highveld Techno Park, Centurion, Pretoria, South AfricaPO Box 95361, Waterkloof 0145, South AfricaTelephone: +27 12 749 1800Facsimile:+27 12 665 2767Website: www.ansys.co.za

COMPANY SECRETARY Fusion Corporate Secretarial Services Proprietary LimitedUnit 2, Corporate Corner, Marco Polo Street, Highveld, Centurion, South AfricaPO Box 68528, Highveld 0169Telephone: +27 12 749 6793Facsimile: +27 12 749 6793

TRANSFER SECRETARIES Computershare Investor Services Proprietary LimitedGround Floor, 70 Marshall Street, Johannesburg 2001, South AfricaPO Box 61051, Marshalltown 2107, South AfricaTelephone: +27 11 370 5000Facsimile: +27 11 688 5210

DESIGNATED ADVISOR Exchange Sponsors (2008) Proprietary Limited44A Boundry Road, Inanda 2196, South AfricaPO Box 411216, Craighall 2024Telephone: +27 11 880 2113Facsimile: +27 11 447 4824

INDEPENDENT AUDITORS PricewaterhouseCoopers Incorporated2 Eglin Road, Sunninghill 2157, South AfricaPO Box X36, Sunninghill 2157, South AfricaTelephone: +27 11 797 4000Facsimile: +27 11 797 5800

ATTORNEYS Edelstein Bosman Incorporated220 Lange Street, New Muckleneuk, Pretoria 0181, South AfricaPO Box 178, Groenkloof 0027, South AfricaTelephone: +27 12 452 8900Facsimile: +27 12 452 8901

Mechiel Venter Attorneys207 Lasa Vina, Island Club, Century City, Cape Town, South AfricaPO Box 39828 , Moreleta Park 0044, South AfricaTelephone: +27 12 551 9022Facsimile: +27 86 609 9712

BANKERS Standard Bank of South Africa LimitedHillcrest Office Park, 177 Dyer Street, Falcon Place, Hillcrest, South AfricaPO Box 62325, Marshalltown 2107, South AfricaTelephone: +27 12 364 3121Facsimile: +27 86 507 9812

First National Bank LimitedGround Floor, 267 West Avenue, Centurion, South AfricaPO Box 12154, Centurion 0046, South AfricaTelephone: +27 12 643 7766Facsimile: +27 12 634 7777

Nedbank Limited4th Floor Nedbank Menlyn Maine Campus, Cnr Aramist and Constellation Street,

Waterkloof Glen Ext 2, Menlyn, Pretoria 0181, South AfricaPO Box 46, Menlyn 0063, South AfricaTelephone: +27 12 436 7944Facsimile: +27 12 436 7686

ansys.co.za

Documents

Integrated Annual Report - ETION · highlights revenue increased to r474 million from r251 million (up 88,8%) ebitda improved to r42,8 million from r19,5 million (up 119,6%) profit