World leaders · Profile. . . of the DigiCore Group is to provide and disseminate pertinent ... Frans Britz(35) Group Financial Director* Deon du Rand(41) Managing Director ... company,

. . . in the management ofinformation and mobile assets

World leaders . . .

ANNUAL REPORT 2001

digicore cover 24033 11/5/01 12:46 PM Page 2

We strive to attain world leadership in fleet management solutions.

We will achieve this through continuous research and development and atotal commitment to service and customer satisfaction.

We seek to achieve outstanding long-term profitability for our shareholderswhile maintaining a high standard of ethics and developing and rewardingour people accordingly.

Vision and mission

Customer satisfactionProfitability and cash flowEmployee fulfilmentSupplier networkingSocial responsibility

Object ives

Contents

Financial highlights 1Group structure 2Chairman’s review 3Executive deputy chairman’s and managing director’s review 4

Review of operations 7Corporate governance 10Value added statement 12Annual financial statements 13Proxy form attached

digicore front 24033 11/5/01 12:30 PM Page 1

F inancia l h ighl ights

DigiCore Annual Report 2001 1

• Turnover up 217% to R308 million

• Headline earnings per share increased by 2 252%

• Attributable earnings R23 million

• Cash generated R32 million

10,8

2

0,46

10,1

0

3,66

Headline earnings per share

12

10

8

6

4

2

02001200019991998

308

496

97 2

67

81 4

70

50 5

77

Turnover

350 000

300 000

250 000

200 000

150 000

100 000

50 000

02001200019991998

The business . . .Prof i le

. . . of the DigiCore Group is to provide and disseminate pertinentmanagement information to its customers, both commercial and industrial,for the efficient and effective management of mobile assets such as vehiclesand their cargo for both logistic and security purposes, utilising cutting-edgeinformation technology.


Peter Vundla (53) Chairman (non-executive)#

Nick Vlok (45) Executive Deputy Chairman#

Leonardus Truter (43) Group Managing Director

Stuart Aberdein (45) Managing Director

DigiCore Electronics

Frans Britz (35) Group Financial Director*

Deon du Rand (41) Managing Director

DigiCore Technology

Kevin Stanton (40) IT Director

Kobus du Plooy (34) Non-executive Director*

Ufikile Khumalo (35) Non-executive Director

Sifiso Msibi (38) Non-executive Director*#

Ndaba Ntsele (49) Alternate

Etienne Badenhorst (30) Strategic Partners and

Projects Director

André Gouws (29) Projects Director

Mark Hill (42) Regional Director East Coast

Bruce Richards (35) National Sales and

Marketing Director

Malcolm Rousseau (37) Regional Director Cape

Mark Rousseau (39) Regional Director Inland

* Audit committee

# Remuneration committee

Group structure

Directors Management team


14 countries

Manufacturing

Research anddevelopment

Cellular service

14 branches

In reporting its third set of results as a listedcompany, DigiCore has met its forecasts, provingthat our business model is now robust and our focuson customer service is reaping rewards.

Business environmentThe review period was another demanding one forlisted stocks, with continued negative sentimenttowards small capitalisation stocks and theprecipitous tumble of information technology andtelecommunication stocks worldwide. While growthin South Africa’s economy was initially expected tobe strong, a slowing US economy had a knock-oneffect on world markets, to which the domesticeconomy was not immune.

Domestic growth forecasts have been incrementallylowered during the year, with the secondary sectorbeing the key driver in the wake of a dramaticslowdown in agricultural output growth. Themanufacturing sector benefited from strengtheningdomestic fixed capital formation growth as well assome private consumption growth, while becomingmore competitive globally owing to rand weakness.

The lagged effects of high crude oil prices saw aseries of fuel price increases in South Africa sinceJune 2000, with a concomitant effect on thetransport sector. Activity in the sector has improvedin 2001, albeit off a low base.

As a major provider to the transport industry,DigiCore responded by continuing to invest insecuring its place as market leader, domesticallyand offshore.

DigiCore’s technology platform and extensive skillscontinue to underpin our success in the fleetmanagement market. The standard of our researchand development is reflected in the increasingacceptance of our technologies in developedmarkets. With these strong foundations, DigiCore isable to conclude alliances with international ownersof leading technologies to enhance our portfolio ofproducts and services.

The global fleet management market continues togrow apace and DigiCore is well placed to benefit

from this expansion. Multinationals, such as Honda,and existing clients such as debis FleetManagement, with its strong foothold in SouthAfrica and Europe, are acknowledging the value offleet management in controlling operationalexpenditure in all their markets.

Key indicators point to the continued growth of theSouth African economy in the next two to threeyears, which is positive for the transport sector and,therefore, for DigiCore.

With increasing pressure on national and provincialgovernments to manage state assets moreefficiently, DigiCore has the track record and therequired empowerment credentials, throughPamodzi Investment Holdings, to benefit fromoutsourcing initiatives to drive these efficiency gains.

Management strengthenedIn January 2001, Dr Leonardus Truter was appointedmanaging director of DigiCore, succeedingNick Vlok who became executive deputy chairman.I believe the company will benefit greatly fromDr Truter’s extensive experience in the SouthAfrican, sub-Saharan and north Africantransportation, vehicle and fleet managementindustries. We are already seeing the benefits of hisintense commitment to customer service.

During the year, Ndaba Ntsele was appointed analternate non-executive member of the board.Mr Ntsele is chief executive of Pamodzi InvestmentHoldings.

Our thanksIt has been an exciting and challenging year. Theyear ahead will be no different. The results reflectthe dedication of our people at all levels and I thankthem most sincerely on behalf of the board.

B P VundlaChairman


Chairman’s rev iew


Our confidence in DigiCore’s future has beenvindicated with these results, and reflects thebenefit of continuous investment in research anddevelopment. DigiCore is maturing as a truly 21stcentury technology company with real-timemanagement systems solutions. Our business is toprovide and disseminate pertinent managementinformation to our customers, both commercial andindustrial, for the efficient management of mobileassets such as vehicle and cargo, for logistic andsecurity purposes, using the most advancedinformation technology.

Financial performanceThe 12 months to 30 June 2001 marked DigiCore’sthird year as a JSE-listed company and exceedingour forecast by achieving a R308 million annualturnover. This was a 217% increase compared to theR97,3 million recorded in the previous year andreflects the successful completion of phase one ofthe five-year debis Fleet Management contract,worth R150 million.

Operating profit increased in line with revenue,reaching R35,0 million (2000: R3,8 million). Netfinancing costs declined materially for the period as thegroup’s cash position improved by R32,5 million.

Headline earnings per share increased to10,82 cents (2000: 0,46 cents). No dividend wasdeclared (2000: nil cents).

Exports accounted for 15,5% of all the C-Track unitssold during the period. A significant increase isexpected during the forthcoming year.

These pleasing results were achieved against thebackground of the transportation industry that wasaffected by lower consumer demand, continual fuel

increases and persistent payload overcapacityaggravated by low transportation rates. Discountingthe debis Fleet Management contract, DigiCoremaintained its market share in an increasinglycompetitive sector without sacrificing sales margins.

With the first phase of the debis Fleet Managementcontract completed in February 2001, phase two isnow in progress, resulting in a steady revenuestream from deinstallation, reinstallation andmaintenance of C-Track units in the outsourcedTelkom fleet. C-Track has now become the de factostandard for all future fleet management systemsimplemented in co-operation with debis FleetManagement, and in association with several otherequivalent industry participants.

HighlightsDuring the year, DigiCore received the VehicleSecurity Association of South Africa (VESA) award foroutstanding product innovation and loss reduction infleet management. Competing against eight otherreputable contenders, DigiCore took the prestigiousaward with our C-Track fleet solutions system.

Market overviewSouth African transport companies and fleet ownersare increasingly taking advantage of the solutionsoffered by fleet management companies inimproving profitability and efficiency by focusing ontheir core business. In more mature markets, such asEurope, fleet owners are focusing on customerservice, new legislation and cost reductions in theiroperations and are starting to use informationtechnology systems to achieve their objectives.

These trends position DigiCore extremely well in amarket that offers immense potential for ourtailored fleet solutions.


Execut ive deputy chairman’s andmanaging d i rector ’s rev iew

DigiCore monitors global industry trends andis positioned extremely well to offer tailoredfleet solutions.



Business overviewAs a market-orientated, technology-drivencompany, DigiCore’s key business objectives andstrategies during the review period were gearedtowards reprofiling the company as South Africa’sforemost provider of fleet management systemssolutions.

In anticipation of the changing nature of ourindustry, we identified the need for an improvedfeedback system. A new enterprise resourceplanning system will allow us to react more rapidlyto customer demands and market trends. It willenable us to apply workable policies andprocedures while co-ordinating our externalmarketing and delivery activities.

DigiCore has completed an extensive businessoptimisation process, streamlining our business andinstilling teamwork between our business units. Thishas resulted in improved efficiencies and costmanagement and has further enhanced customersatisfaction. Clearly-defined responsibilities,increased delegation of authority and greateraccountability has resulted in better businessintegration and internal co-operation.

DigiCore has evolved into a customer-focusedcompany, driven by the goal of striking partnershipswith our clients by adding value to their business.Our focus has shifted from generating sales toenhanced customer care – establishing long-termrelationships based on business ethics andcorporate culture, rather than price and volumealone.

We see ourselves as an extension of our customers’business, where our value propositions accentuatecost savings, expertise and quality service.Targeting larger corporations and fleet operators,locally and internationally, we acknowledge thatservice excellence, superior products and softwaresolutions will be the key distinguishing factorsbetween DigiCore and its competitors.

DigiCore places great emphasis on the research anddevelopment of more competitive products inmeeting market demands for value-added, flexible,feature-rich and cost-efficient technology.Subsequent to the year end, we introduced the firstlocally developed depot-based fuel managementsystem branded as DigiCore Fuel Solutions. Thisproduct will greatly enhance cost savings fortransport and vehicle operators, as fuel cost hasbecome the biggest single expense. Significantsavings are possible through the excellentinformation and control that is provided byDigiCore’s fuel management system.

Intellectual propertyUnderstanding the complexities of the fleet andcommercial vehicle industry, DigiCore considersqualified and experienced people crucial in designingappropriate solutions for fleet management issues.Ongoing development and training, pivotal tomaintaining our market leadership, have been furtherenhanced by the launch of an in-house trainingprogramme during the year.

Our people are encouraged to set individual andteam goals in line with the company’s business



objectives. By empowering our employees andcreating career paths in DigiCore, we can deliver aworld-class service and continue to developinnovative, quality products.

During the year under review, the intellectual andbrand value property of the group was valued atR181 million by Adams & Adams.

ProspectsThe outlook for the new financial year is optimistic,given the increasing opportunities in Europe and the50% stake acquired in DigiCore Europe (previouslyC-Track Europe). The rising trend of outsourcingfleets locally will further underpin our growth.

Achieving sustainable, profitable growth locally andin offshore markets rests on our success inbecoming one of the primary providers of fleetmanagement services and information in ourchosen markets.

With new sales strategies in place, opportunities tomarket the newly-acquired fuel management system,the Beka-Max central lubrication system and EEC-approved Elson speed limiter have greatly increased.

In conjunction with our very successfulempowerment partner, Pamodzi InvestmentHoldings Limited, we have identified strategicpartners in the vehicle manufacturing, vehicle retail,financing and insurance industries, which will, inturn, add further value to our customers.

DigiCore is an increasingly capable enterprise andwe are confident the group will continue to addvalue to all its stakeholders by maintaining itsgrowth worldwide.

AppreciationWe thank our directors, management, staff,investors and customers for their ongoing supportand loyalty. We look forward to sharing whatpromises to be an exciting and rewarding yearwith all.

Nick Vlok Dr Leonardus TruterExecutive deputy Group managing directorchairman

“DigiCore’s C-Track is an essential managementtool for any fleet owner who wishes to manage

his fleet efficiently.” Reinhardt Transport

Execut ive deputy chairman’s and managing d i rector ’s rev iew



DigiCore Fleet ManagementDigiCore Fleet Management (DFM) employs over300 people in 14 branches throughout South Africa.DFM is the leading supplier to fleet owners in SouthAfrica, with some 70 000 on-board computer unitsinstalled. The review period was characterised by avery active tender market, with DigiCore tenderingfor 190 000 vehicles since January 2001. Clearly, if afraction of these tenders are secured, the impact onfuture revenue streams could be considerable.

We previously reported on the R150 millioncontract for 19 000 C-Track fleet management andtracking devices for debis Fleet Managementvehicles outsourced by Telkom. The five-yearcontract is the largest fleet management out-sourcing project in South Africa, with DigiCoresupplying technology that includes 24-hour vehicletracking and operational information, seven days aweek. This contract will provide significant incomefor years to come from the related GSM voice anddata contracts and from budgeted fleet renewalsover the contract period.

In October 2000, C-Track 2000, DigiCore’s newbase station and back-office application for our C-Track real-time fleet management and trackingsystem, was launched at the Auto Africa show. Withthis launch, DigiCore has again raised the barriers toentry by moving real-time fleet management from asecurity and risk management application into therealm of information technology systems. C-Track2000 allows for integration with smart cards andbarcode scanners, as well as the implementation ofbusiness automation systems based on enterprise

resource planning (ERP) software such asJD Edwards and SAP.

In January 2001, a strategic technology alliance wassecured with the Imperial Group, resulting in theconversion of 400 opposition systems to C-Tracktechnology. This was followed by an order to fitImperial’s Tanker Services fleet of 650 vehicles withthe same technology.

Relentless fuel price increases have resulted in fuelnow comprising between 30% and 40% of primarycosts when calculating the life cycle costs of acommercial fleet vehicle. DigiCore formed adedicated division, DigiCore Fuel Solutions, andpurchased the best locally developed home-base fueltechnology as a foundation for future developments.With strong market response, this division already hasan order book of several fuel sites.

Customer support was further enhanced during theyear. Over 100 fully equipped mobile servicevehicles are dispatched from branches nationwidedaily to provide on-site service for our customers.New, ongoing training programmes have beenintroduced to improve our operational staff for evenbetter customer service.

DigiCore TechnologyDigiCore Technology annually spends around 15%of the company’s pre-tax profit on research anddevelopment and will continue to do so in future.This underscores the group’s commitment toremaining at the forefront of the highly-competitiveand fast-moving field in which we operate.

Review of operat ions


DigiCore Technology has always worked closelywith market leaders in GSM data communicationsand equipment supply. In line with this strategy, thecompany continues to expand its solutions andworks closely with both Vodacom and MTN.DigiCore’s in-house software development teamincludes engineers who were among the pioneers inthe GPS mapping field of the late 1980s. Theircombined experience was instrumental inproducing the new C-Track 2000 PC software that isthe core of the C-Track system. The software ispowerful and flexible, giving users unprecedentedcontrol over their fleet by maximising the amount ofdata that can be transmitted while minimising thecosts of communication.

DigiCore ElectronicsBased in Durban, DigiCore Electronics is adedicated manufacturing division, employing56 engineers and production staff.

This division has manufactured a variety of vehiclemanagement and monitoring systems using satellitepositioning, GSM cellular systems and otheradvanced communication technologies. These aresome of the most innovative products in the worldand are key to DigiCore Fleet Management’ssuccess in the local market and our growinginternational presence.

DigiCore InternationalDigiCore International facilitates and co-ordinatesinternational support to current and futureinternational markets.

EuropeEurope is a technically challenging and competitivemarket. The successful and profitable modelestablished in the Benelux region by DigiCore overthe past 18 months is now being replicatedthroughout Europe. Our product is now familiar andavailable in 11 countries in Europe and stronggrowth is expected from what is a relativelyuntapped market. The growth in the area has beenin excess of 150% over the past year compared tothe previous year. With a more aggressive focus inEurope, we foresee sales for this region to increaseto at least 70% of our export sales.

PakistanThe Pakistan operation is particularly wellpositioned and enjoys exclusive approval frominsurance companies, banks and governmentdepartments. We have a strong operationalpresence through a direct equity investment of30%.

The highlight of the review period was theconclusion of an agreement with Honda by


“Accurate costing of our fleet operations is nowpossible with the real time C-Track management

information.”Rhino Security

Review of operat ions


9

DigiCore Pakistan. In terms of the originalequipment manufacturer agreement, DigiCore willsupply the C-Track system as an optional item innew Honda vehicles sold in showrooms, withassociated insurance discount benefits. Pakistanrepresents a huge export market for the group ascrime rates have made installing vehicle trackingsystems in the new car market almost mandatorywhen applying for vehicle finance. DigiCore isbudgeting on exporting some 100 additional unitsper month to this region. DigiCore Pakistancontributed 35% to global exports during theperiod under review.

AustraliaOperations in this region have been belowexpectations during the first half of the period. Thedecision by management to employ their own sales

and technical staff during January 2001, opposed toutilising distributors as before, resulted in improvedsales and customer service.

Australian Waterways Authority NSW, a DigiCoreAustralia customer, received a prestigious globalaward for excellence in applying geographicinformation system (GIS) technology in protectingand managing Australia’s navigable waters. TheWaterways Authority competed against 6 000organisations worldwide. The award was presentedin San Diego, California, at the 20th annual ESRIinternational user conference, with DigiCore’s C-Track brand receiving international recognition.The C-Track system was at the heart of the SydneyOlympics’ security measures, ensuring the safety ofthe public and contestants.

DigiCore Annual Report 2001

“With a more aggressive focus in Europe weforesee sales for this region to increase to at

least 70% of our export sales.”



The company is fully committed to the principles ofopenness, accountability and integrity as advocatedin the King Code of Corporate Governance. Thedirectors recognise the need to conduct thebusiness of the enterprise with integrity and inaccordance with generally accepted corporategovernance practices.

Board of directorsThe board currently comprises of the non-executivechairman, six executive directors and three non-executive directors. The role of chairman, executivedeputy chairman and group managing director aredistinct from each other and do not vest with thesame person.

The board is responsible for the strategic directionof the group and assists executive management inthe setting and implementing of key policies. Thenon-executive directors provide independentjudgment on issues of strategy, performance andstandards of conduct. The non-executive directorsare entirely independent and have business acumenand experience that add meaningful value toDigiCore’s strategy and vision.

The board meets bi-monthly to review the results ofthe group and to ensure that the board or anappropriate subcommittee thereof considers allmaterial decisions.

Audit committeeThe audit committee, chaired by a non-executivedirector, consists of two non-executive directors andone executive director. The external auditors havefree access to the audit committee.

The audit committee convenes at least twice a yearwith the appropriate management and the externalauditors to discuss issues of accounting, auditing,internal control, financial reporting as well asthe auditors’ findings and recommendations. It

further reviews the financial statements andappropriateness of the accounting policies adoptedby the group.

Remuneration committeeA remuneration committee is responsible fordetermining conditions of employment andremuneration packages of executive directors andmanagement.

The remuneration committee, chaired by a non-executive director, consists of two non-executivedirectors and one executive director.

Internal controlsThe board of directors is responsible for the group’ssystems of internal control. In order to fulfil itsresponsibilities, management maintains accountingrecords and has developed, and continues tomaintain, appropriate systems of internal control.The directors report that the group’s internalcontrols and systems are designed to providereasonable, not absolute, assurance as to theintegrity and reliability of the annual financialstatements; to safeguard, verify and maintainaccountability of its assets; and to detect andminimise significant fraud, potential liability, lossand material misstatement, while complying withapplicable laws and regulations.

Employees are required to maintain the highestethical standards in ensuring that business practicesare conducted in a manner which in all reasonablecircumstances is above reproach.

The external auditors review and test appropriateaspects of internal financial control systemsduring the course of their statutory examinationsof the group. In addition, an internal auditfunction was established during the year to reviewcontrols and the effectiveness thereof on anongoing basis.

Corporate governance



No material loss, exposure or misstatement arisingfrom the material breakdown in the functioning ofthe control systems has been reported to thedirectors in respect of the year under review.

Going concernThe directors have no reason to believe that thegroup will not be a going concern for the yearahead. For this reason, they continue to adopt thegoing-concern basis in preparing the financialstatements.

Employee participationThe board is committed to improvingcommunication with employees and encouragesemployees to participate at all levels in thedecision-making processes of the group. A shareoption scheme has been established to provide anincentive to employees to remain in the service ofthe group and to increase their proprietary interestin the group’s success.

Employment equityThe group has employment policies in place that itbelieves are appropriate to the business and the

market in which it trades. They are designed toattract, motivate and retain quality staff at all levels.Equal employment opportunities are offered to allemployees without discrimination.

Shareholder communicationThe company holds regular meetings withanalysts and institutional shareholders, primarilyfollowing the announcement of financial results.Communication with other investors and share-holders is conducted via the annual and interimreports, as well as the annual general meeting.Financial and other information is made available onthe company’s website, www.digicore.com.

Code of ethicsThe group subscribes to a code of ethics andendeavours to act with honesty, responsibility andintegrity towards all stakeholders.



Revenue 308 496 97 267

Paid to suppliers for materials

and services 233 635 65 217

Value added 74 861 32 050

Interest received 3 316 69

78 177 100 32 119 100

Distributed as follows:

To compensate employees

Salaries, wages and other benefits 30 064 38,5 24 062 74,9

To compensate providers of capital 3 741 4,8 2 574 8,0

Interest on borrowings 3 741 2 574

Dividends paid to ordinary shareholders – –

To pay government taxes 12 066 15,4 452 1,4

Normal company taxes 11 381 272

Secondary tax on companies – –

Regional Services Council levies 685 180

Retained in group for expansion

and development 32 306 41,3 5 031 15,7

Depreciation 9 554 4 323

Retained profit 23 116 1 041

Deferred taxation (364) (333)

78 177 100 32 119 100

For the year ended 30 June 2001

2001 2000

R’000 % R’000 %

Value added statement



DigiCore Hold ings L imited – Consol idated group f inancia l s tatements

Contents

Statement of responsibility by the board of directors 13Directors’ report 14Auditors’ report 15Certificate by company secretary 15Income statement 16Balance sheet 17Statement of changes in equity 18Cash flow statement 18

Notes to the cash flow statement 19Accounting policies 20Notes to the annual financial statements 22Company financial statements 29Analysis of shareholding 31Analysis of shareholders 31Notice of annual general meeting 32Administration IBCProxy form attached

Statement of responsib i l i ty by the board of d i rectors

The directors are responsible for the preparation, integrity and fair representation of the financial statements of

DigiCore Holdings Limited and its subsidiaries. The financial statements presented on pages 16 to 28 have

been prepared in accordance with the South African Statements of Generally Accepted Accounting Practice,

and include amounts based on judgments and estimates made by management.

The going-concern basis has been adopted in preparing the financial statements. The directors have no reason

to believe that the group or any company within the group will not be going concerns in the foreseeable future

based on forecasts and available cash resources.

The financial statements have been audited by the independent accounting firm Fisher Hoffman PKF (Pretoria) Inc,

which was given unrestricted access to all financial records and related data, including minutes of the meetings

of shareholders, the board of directors and committees of the board. The directors believe that all representations

made to the independent auditors during their audit are valid and appropriate. The audit report is presented on

page 15.

The financial statements which appear on pages 16 to 28 were approved by the board of directors and are

signed on its behalf by:

N H Vlok L E Truter

Centurion

30 September 2001




Directors ’ report

The directors have pleasure in presenting their report on the activities of the group for the year ended 30 June 2001.

Nature of businessDigiCore provides and disseminates pertinent management information to its customers, both commercial andindustrial, for the efficient and effective management of mobile assets, such as vehicles and their cargo, for bothlogistic and security purposes utilising leading information technology.

Financial resultsThe consolidated net profit attributable to ordinary shareholders amounted to R23 115 557 (2000: R1 040 626).Detailed reports on the results are contained in the financial statements on pages 16 to 28.

DividendsNo dividends have been declared or are recommended for the financial year under review.

Share capitalThe authorised share capital of the company comprises 1 000 000 000 ordinary shares of 0,1 cents each. Theauthorised share capital remained unchanged throughout the financial year under review.

The issued share capital of the company remained unchanged at 239 256 113 ordinary shares of 0,1 cents each.

The unissued shares are under the control of the directors in terms of a resolution of members passed at theannual general meeting of shareholders held on 8 November 2000. This authority is valid until the next annualgeneral meeting.

DirectorsThe directors in office at the financial year-end and the date of this report, are as follows:B P Vundla (Chairman)*N H Vlok (Deputy chairman)L E Truter (Managing)S R AberdeinF W BritzD du RandK R StantonJ J du Plooy*U Khumalo*S A Msibi*N Ntsele*+

* Non-executive+ Alternate

D du Rand was appointed as executive director (previously alternate) on 7 December 2000. Dr L E Truter wasappointed as group managing director on 15 January 2001. N Ntsele was appointed as alternate director of thecompany on 15 January 2001. U Khumalo was appointed as director of the company on 18 July 2001.

D J O Sauerbier resigned as director on 30 March 2001. In terms of the articles of association of the company,Messrs B P Vundla, L E Truter, F W Britz, J J du Plooy, S A Msibi and U Khumalo retire by rotation at theforthcoming annual general meeting and, being eligible, offer themselves for re-election.

Directors’ shareholdingAt 30 June 2001, the following directors held shares in the company:

Directly IndirectlyN H Vlok 3 213 931 41 092 823S R Aberdein – 22 165 250K R Stanton – 13 499 050D du Rand 50 000 2 050 000

ContractsNo contracts in which directors and officers of the company had an interest and that significantly affected theaffairs or business of the company or any of its subsidiaries were entered into during the year.

Subsidiary companiesNo special resolutions were passed by any of the subsidiary companies during the year.

Events subsequent to balance sheet dateThe directors are not aware of any matter or circumstance arising since the end of the financial year, nototherwise dealt with in this report or the group financial statements that would significantly affect the operationsof the group or the results of those operations.

digicore acc 24033 11/5/01 11:51 AM Page 14

Report of the independent auditorsWe have audited the annual financial statements of DigiCore Holdings Limited set out on pages 16 to 28

for the year ended 30 June 2001. These financial statements are the responsibility of the company’s directors.

Our responsibility is to express an opinion on these financial statements based on our audit.

ScopeWe conducted our audit in accordance with statements of South African Auditing Standards. Those standards

require that we plan and perform the audit to obtain reasonable assurance that the financial statements are free

of material misstatement. An audit includes:

• examining on a test basis, evidence supporting the amounts and disclosures in the financial statements;

• assessing the accounting principles used and significant estimates made by management; and

• evaluating the overall financial statements presentation.

We believe that our audit provides a reasonable basis for our opinion.

Audit opinionIn our opinion, the financial statements fairly present, in all material respects, the financial position of the

company at 30 June 2001 and the results of its operations and cash flow information for the year then ended in

accordance with generally accepted accounting practice, and in the manner required by the Companies Act.

Registered Accountants and Auditors

Chartered Accountants (SA)

Pretoria

30 September 2001

Auditors ’ report


Cert i f icate by company secretary

I declare that, to the best of my knowledge, the company has lodged with the registrar all such returns as are

required of a public company in terms of the Companies Act, 1973, as amended, and that all such returns

are true, correct and up to date.

F W Britz

Company secretary

Centurion

30 September 2001



Revenue 308 496 97 267

Operating profit 1 35 043 3 818

Net interest paid 2 (479) (2 505)

Profit before taxation 34 564 1 313

Taxation 3 11 381 272

Profit after taxation 23 183 1 041

Attributable to outside shareholders 67 –

Earnings attributable to ordinary shareholders 23 116 1 041

Weighted average number of shares in issue (thousands) 239 256 225 810

Earnings per share (cents) 4 9,66 0,46

Headline earnings per share (cents) 4 10,82 0,46

Dividends per share (cents) – –


2001 2000

Notes R’000 R’000

Income statement


AssetsNon-current assets 44 622 46 088

Property, plant and equipment 5 10 155 7 025

Intangible assets 6 26 785 31 024

Investments 7 1 082 706

Loans receivable 8 6 600 7 333

Current assets 84 738 62 218

Inventories 9 23 233 22 168

Trade receivables 10 43 373 36 734

Loans receivable – 27

Term deposits 11 153 16

Bank balances 6 979 3 273

Total assets 129 360 108 306

Equity and liabil it iesCapital and reserves 92 663 69 482

Issued capital 11 239 239

Share premium 36 587 36 587

Minority interest in subsidiaries 65 –

Distributable reserve 55 772 32 656

Non-current liabilities 2 227 5 178

Long-term liabilities 12 2 063 4 649

Deferred taxation 13 164 529

Current liabilities 34 470 33 646

Taxation 7 472 1 706

Trade payables 25 911 12 916

Current portion of long-term liabilities 12.1 1 087 1 332

Bank overdraft – 17 692

Total equity and liabilities 129 360 108 306

As at 30 June 2001

2001 2000


Balance sheet




2001 2000


Cash f low statement


Balance at 1 July 1999 215 000 12 352 087 – 31 615 431 44 182 518

Net profit for the year 1 040 627 1 040 627

Issue of share capital 24 256 24 234 858 24 259 114

Balance at 1 July 2000 239 256 36 586 945 – 32 656 058 69 482 259

Net profit for the year 23 115 557 23 115 557

Minority interest 65 283 65 283

Balance at 30 June 2001 239 256 36 586 945 65 283 55 771 615 92 663 099


Share Share Minority Distributable

capital premium interest reserve Total

R R R R R

Statement of changes in equity

Operating activities 42 969 (1 749)

Cash received from customers 301 307 96 172

Cash paid to suppliers and employees (251 879) (87 477)

Cash generated by operating activities A 49 428 8 695

Interest received 3 316 69

Interest paid (3 795) (2 574)

Taxation paid B (5 980) (7 939)

Investing activities (8 190) (30 651)

Investments to maintain operating capacity

– Proceeds on disposal of property, plant and equipment 429 122

– Additions to fixed assets (6 495) (2 458)

– Intangible assets acquired (1 923) (3 176)

Investments to expand operating capacity

– Investment in subsidiaries – (24 258)

– Investment and loans (201) (881)

Financing activities (2 244) 26 070

Decrease in long-term borrowings (2 831) (1 854)

Increase in short-term borrowings 587 3 665

Proceeds of share issue – 24 259

Net movement in cash resources 32 535 (6 330)

Cash resources at the beginning of the period (14 403) (8 073)

Cash resources at the end of the period C 18 132 (14 403)


A. Cash generated by operating activities

Net profit before taxation 34 564 1 313

Adjustments for:

Depreciation and amortisation 9 554 4 323

Investment income – (69)

Finance costs 479 2 574

Loss on disposals of fixed assets 49 418

Other non-cash items (509) 74

44 137 8 633

Movements in working capital

Increase in inventories (1 065) (3 693)

Increase in accounts receivable (6 639) (1 095)

Increase/(decrease) in accounts payable 12 995 4 851

49 428 8 696

B. Taxation paid during the year 5 980 7 939

Charged to the income statement 11 381 272

Deferred taxation 364 333

Movement in taxation balance (5 765) 7 334

C. Cash and cash equivalents 18 132 (14 403)

Cash on hand and balances at bank 18 132 (14 419)

Short-term loans receivable – 16


2001 2000

R’000 R’000

Notes to the cash f low statement





Account ing pol ic ies

Accounting basisThe consolidated financial statements are prepared on the historic cost basis. The following are the principal

accounting policies used by the company that are consistent with those of the previous year.

These statements comply with statements of generally accepted accounting practice.

Basis of consolidationThe consolidated annual financial statements incorporate the results and financial position of the company

and all its subsidiaries. The results of subsidiaries are included from the effective dates of acquisition until

the effective dates of disposal. All significant intergroup transactions and balances have been eliminated on

consolidation.

GoodwillGoodwill represents the excess of the cost of shares in subsidiary companies over the fair values of the net

identifiable assets acquired. This is brought into account in the year in which the subsidiary company is acquired

and is amortised on a systematic basis over the estimated useful life. Where the estimate useful life is

indetermined, or exceeds the business planning horizon of 20 years, it is amortised over a 20-year period.

Deferred taxationDeferred taxation is provided on the comprehensive basis using the liability method. In terms of the

comprehensive basis the tax effects of all temporary differences are accounted for. Where the tax effects of

temporary differences give rise to a deferred tax asset, the asset is recognised except if it is improbable that

the asset will be recovered in the foreseeable future.

Foreign exchangeTransactions are recorded at the rates ruling at transaction date. All realised and unrealised gains and losses on

covered and uncovered transactions are included in the income statement as incurred. Liabilities in foreign

currencies are converted to South African rand at rates ruling at the balance sheet date.

Revenue recognitionRevenue represents net invoiced sales excluding value-added tax. Group revenue excludes intercompany

transactions.

InventoryInventory, which consist of goods for resale, is valued at the lower of cost and net realisable value. Cost is

determined on average cost basis. Redundant and slow-moving inventories are identified and written down

to their estimated net realisable value.

Fixed assetsFixed assets are stated at cost less the related provision for depreciation. Depreciation is provided on the

straight-line basis at rates considered appropriate to reduce the book values to estimated residual values over

the expected useful lives of the assets as follows:

Plant and equipment 15 – 20% Office equipment 16,67 – 33,33%

Motor vehicles 20 – 25% Computer equipment 33,33%

Furniture and fittings 16,67% Computer software 50%

Leasehold improvements 20%




Account ing pol ic ies

Capitalised development costsResearch costs are written off as incurred. Development costs incurred in the internal design and production of

new or substantially improved software is capitalised, provided that:

• economic feasibility can be demonstrated;

• technical feasibility can be demonstrated;

• there is board approval for the activity;

• the cost to develop has been determined; and

• the time frame for development has been clearly defined.

Where development costs are deferred, they are written off over a three-year period. It is realised that the

estimated product life cycle for software may change as a result of technological obsolescence or actions by

competitors. For this reason, the amortisation period will be reviewed at each financial year-end. If the expected

useful life of a software product is significantly different from previous estimates, the amortisation period will be

changed accordingly. Such changes would be accounted for as a change in accounting estimate, by adjusting

the amortisation charge in the current and future periods. The amortisation begins from the commencement of

the commercial sale of the product to which the development costs relate.

Development costs incurred in routine efforts to refine, enrich, or otherwise generally improve upon the quality

of existing products shall be expensed as incurred.

Subsequent development costs on new or substantially improved software, after its completion, will be

recognised as an expense when it is incurred, unless:

• it is probable that this expenditure will enable the asset to generate future economic benefits in excess of its

originally assessed standard of performance;

• this expenditure can be measured and attributed to the software reliably.

InvestmentsInvestments in financial assets that do not have a quoted market price in an active market and whose fair value

cannot be reliably measured, are stated at cost, except where in the opinion of the directors there is a

permanent diminution in value, in which case they are written down to directors’ valuation.

Finance agreementsAssets held under finance agreements are capitalised. At the commencement of the agreements the cost of the

assets are capitalised and the equivalent amounts are shown as a liability to the financier. Finance charges are

written off over the length of the agreement period based on the effective rates of interest.

Financial instrumentsFinancial instruments carried on the balance sheet include bank balances, investments, receivables, trade

payables, leases and borrowings. These instruments are carried at their estimated fair value.



1. Net operating profitNet operating profit is stated after taking into account the following:

Cost of sales 195 263 44 938

Directors’ remuneration

For services as directors 380 244

For management services 2 772 2 262

3 152 2 506

Operating lease payments

Land and buildings 1 913 1 848

Office furniture and equipment 337 500

Motor vehicles 166 –

2 416 2 348

Auditors’ remuneration

Audit fees 400 175

Other services and expenses 85 78

485 253

Depreciation and amortisation

Property, plant and equipment 2 887 2 400

Trademarks and development cost 5 449 1 923

Goodwill 1 218 –

9 554 4 323

Loss on disposal of property, plant and equipment 49 418

Profit on foreign exchange 275 –

2. Net interest paidInterest received 3 316 69

Interest paid (3 795) (2 574)

(479) (2 505)

3. TaxationSouth African taxation

Normal taxation 11 745 605

Deferred taxation (364) (333)

11 381 272

Reconciliation of rate of taxation % %

Taxation as percentage of income before taxation 32,9 21,0

Adjusted for:

– Disallowable expenditure (3,3) –

– Tax losses utilised 0,4 8,0

– Permanent differences – 1,0

Normal rate of company taxation 30,0 30,0


2001 2000

R’000 R’000

Notes to the annual f inancia l s tatements





4. Earnings per ordinary shareThe calculation of earnings per ordinary share is based on net profit attributable to ordinary shareholders

of R23 115 557 (2000: R1 040 626).

The calculation of headline earnings per share is based on earnings of R25 895 009 (2000: R1 040 626).

The calculation of ordinary earnings per share and headline earnings per share is based on a weighted

average of 239 256 113 (2000: 225 810 000) ordinary shares in issue during the financial year under

review.

Reconciliation between earnings and headline earnings:

Share of

retained

Profit on earnings

ordinary of outside Net profit

activities Taxation shareholders 2001 2000

Per the financial statements 34 564 526 (11 381 370) (67 599) 23 115 557 1 040 626

Loss on investments 2 328 553 (766 743) – 1 561 810 –

Goodwill amortisation 1 217 642 – – 1 217 642 –

38 110 723 (12 148 113) (67 599) 25 895 009 1 040 626

2001 2000

Cost/ Accumulated Carrying Cost/ Accumulated Carrying

valuation depreciation value valuation depreciation value

R R R R R R

5. Property, plant and equipmentOwned assets

Land and buildings 115 176 – 115 176 115 176 – 115 176

Plant and equipment 1 187 239 274 248 912 991 673 765 183 104 490 661

Motor vehicles 4 052 904 2 247 467 1 805 437 3 958 141 2 225 703 1 732 438

Furniture and fittings 1 688 002 404 551 1 283 451 1 021 818 303 287 718 531

Office equipment 1 543 499 469 791 1 073 708 1 305 706 514 546 791 160

Computer equipment 2 612 311 1 236 953 1 375 358 1 809 269 783 360 1 025 909

Computer software 1 621 366 410 183 1 211 183 217 175 62 078 155 097

12 820 497 5 043 193 7 777 304 9 101 050 4 072 078 5 028 972

Capitalised leased

assets

Plant and equipment 209 254 72 507 136 747 – – –

Motor vehicles 3 373 094 1 563 307 1 836 787 2 410 038 745 269 1 664 769

Leasehold

improvements 315 153 53 602 261 551 76 308 22 583 53 725

Office equipment 204 667 80 283 124 384 284 945 55 326 229 619

Computer equipment 53 515 35 188 18 327 69 031 21 028 48 003

4 155 683 1 777 887 2 377 796 2 840 322 844 206 1 996 116

16 976 180 6 821 080 10 155 100 11 941 372 4 916 284 7 025 088



5. Property, plant and equipment (continued)

The carrying amounts of property,

plant and equipment can be

reconciled as follows:

Owned assets

Land and buildings 115 176 – – – 115 176

Plant and equipment 490 661 570 553 (4 961) (143 262) 912 991

Motor vehicles 1 732 438 495 800 (143 266) (279 535) 1 805 437

Furniture and fittings 718 531 786 627 (70 132) (151 575) 1 283 451

Office equipment 791 160 572 051 (71 645) (217 858) 1 073 708

Computer equipment 1 025 909 1 345 523 (30 209) (965 865) 1 375 358

Computer software 155 097 1 371 222 (53 920) (261 216) 1 211 183

5 028 972 5 141 776 (374 133) (2 019 311) 7 777 304

Capitalised leased assets

Plant and equipment – 183 957 – (47 210) 136 747

Motor vehicles 1 664 769 904 910 – (732 892) 1 836 787

Leasehold improvements 53 725 238 848 – (31 022) 261 551

Office equipment 229 619 25 463 (93 750) (36 948) 124 384

Computer equipment 48 003 – (10 133) (19 543) 18 327

1 996 116 1 353 178 (103 883) (867 615) 2 377 796

7 025 088 6 494 954 (478 016) (2 886 926) 10 155 100

2001 2000

Cost/ Accumulated Carrying Cost/ Accumulated Carrying

valuation amortisation value valuation amortisation value

R R R R R R

6. Intangible assetsGoodwill 24 581 946 1 217 642 23 364 304 24 259 114 – 24 259 114

Trademarks and

development cost 11 536 652 8 115 874 3 420 778 10 465 223 3 700 174 6 765 049

36 118 598 9 333 516 26 785 082 34 724 337 3 700 174 31 024 163

The carrying amounts of intangible assets can be reconciled as follows:

Carrying value Carrying

at beginning value at

of year Additions Disposals Amortisation end of year

R R R R R

Goodwill 24 259 114 322 832 – (1 217 642) 23 364 304

Trademarks and development cost 6 765 049 1 600 000 505 138 (5 449 409) 3 420 778

31 024 163 1 922 832 505 138 (6 667 051) 26 785 082


Carrying value Carrying

at beginning value at

of year Additions Disposals Depreciation end of year

R R R R R





2001 2000

R’000 R’000


7. InvestmentsListed shares at cost 376 –

Unlisted shares at cost 706 706

1 082 706

Market value of listed shares 553 –

Directors’ valuation of unlisted shares 706 706

1 259 706

Listed shares consist of 1 151 700 shares held in DigiCore

Holdings Limited by DigiCore International (Pty) Limited with

a cost price of R376 244 and a market value of R552 816 as

at the JSE closing on 29 June 2001.

Unlisted shares consist of the following:

– Pakistan 706 706

8. Loans receivableDigiCore staff share incentive scheme 6 600 4 479

Other loans receivable – 2 854

6 600 7 333

9. InventoryRaw materials 8 151 3 817

Work in progress 3 221 1 643

Finished goods 11 433 15 247

Consumables stores 428 1 461

23 233 22 168

10. Trade and other debtorsCurrent amounts receivable 44 289 38 748

Provision for doubtful debts (916) (2 014)

43 373 36 734

Trade debtors serve as security for any bank overdraft facility utilised.

11. Ordinary share capital11.1 Authorised share capital

1 000 000 000 ordinary shares at 0,1 cents par value

11.2 Issued share capital

239 256 113 (2000: 239 256 113) ordinary shares at 0,1 cents each

Balance at the beginning of the year 239 215

Issued for cash during the year – 24

Balance at the end of the year 239 239



12. Long-term liabil it ies12.1 Secured borrowings

Liabilities under finance leases and instalment sales 2 688 3 404

Less: Current portion included in short-term borrowings (1 087) (1 331)

1 601 2 073

Repayable in varying monthly instalments, which

include interest at rates ranging from 14,5% to 17,5%.

12.2 Other loans payable

Owing to other companies 462 2 576

462 2 576

These loans are unsecured, interest free and

no fixed terms for repayment have been set.

Total long-term liabilities 2 063 4 649

13. Deferred taxBalance at beginning of year 529 862

Movements during year attributable to:

– Timing differences (365) (333)

Balance at end of year 164 529

The balance comprises:

– Timing differences in respect of capitalised technology 48 –

– Development costs capitalised for accounting purposes 416 529

– Unrealised profits (300) –

164 529


2001 2000

R’000 R’000






14. Segment reportBusiness segments

The company is organised in four business segments in South Africa for management purposes, namely

Distribution division, Manufacturing division, Cellular division and Research and Development division.

The divisions are the basis on which the company reports its primary segment information:

– The Manufacturing division manufactures the group’s products.

– The Distribution division performs the installation of units and also deinstallation, reinstallation and

maintenance on units sold.

– The Cellular division consists of cellular services supplied to customers.

– The Research and Development division is responsible for research and development within DigiCore.

Research

Distri- Manu- and

bution facturing Cellular Development Elimination Consolidated

Business segment

information

Income

External sales 247 147 183 13 262 033 48 086 306 308 495 522

Inter-segment

sales 21 995 737 124 007 057 1 400 000 11 707 511 (159 110 305) –

Total 269 142 920 137 269 090 49 486 306 11 707 511 (159 110 305) 308 495 522

Segment result

Segment income

less costs 9 920 028 25 823 972 269 520 130 206 (1 100 195) 35 043 531

Investment income 3 316 414

Finance costs (3 795 419)

Taxation (11 381 370)

Profit after taxation 23 183 156

Attributable to outside

shareholders 67 599

Net profit for the period 23 115 557

Other information

Segment assets 39 964 934 43 161 739 12 297 080 2 890 273 98 314 026

Segment liabilities 9 899 925 6 594 871 13 241 471 6 961 009 36 697 276

Capital expenditure 6 738 364 165 117 28 561 1 162 912 8 094 954

Depreciation and

amortisation 7 140 111 2 102 589 27 421 283 856 9 553 977



15. Retirement benefitsThe policy of the group is to provide retirement benefits through independent funds governed by the

Pension Funds Act. The pension and provident funds are defined contribution funds which do not require

an actuarial valuation. The group has no obligations to fund post-retirement medical benefits.

16. Lease commitmentsThe company has entered into leases over fixed property for varying periods at an aggregated charge of

R2 416 000 per year. This charge will increase in future at an escalation of 10% – 12% per annum.

17. Contingent l iabil it iesLimited guarantee – a surety for DigiCore Cellular (Pty) Limited for R500 000.

2001 2000

R’000 R’000

18. Capital commitmentsCommitment for the implementation of ERP system

– contracted but not provided for 800 –

This capital expenditure will be financed from existing

resources and borrowings.

19. Employee incentive schemeThe following information is provided in accordance with

the provisions of the company’s share incentive scheme:

Shares available for allocation to employees 15 692 422

Less: Shares allocated during the current year 15 005 000

Balance of shares available for allocation 687 422

The strike price of the shares is 25 cents. The options are exercisable over a period of five years in

tranches of 20% per year.

Options granted to executive directors in terms of the offer

A total of 4 600 000 options were granted to executive directors at the strike price of 25 cents per share.

20. Comparative figuresWhere necessary, comparative figures have been adjusted to conform with changes in presentation in the

current year.

21. Company resultsThese financial statements represent the consolidated results of the DigiCore Group. No trade or

significant transactions took place in DigiCore Holdings Limited (the company) not disclosed in the

consolidated results. A summarised income statement, balance sheet and notes to the financial

statements for DigiCore Holdings Limited are attached for information purposes.





Gross revenue 15 770 6 210

Operating loss (797) (768)Interest received 6 155 2 337Finance costs (1 940) (407)

Profit before taxation 3 418 1 162Taxation 2 373 156

Profit after taxation 1 045 1 006Retained profits at beginning of year 4 874 3 868

Retained profits at end of year 5 919 4 874


2001 2000

R’000 R’000

Company f inancia l s tatementsIncome statement

AssetsNon-current assets 60 162 50 645

Property, plant and equipment 961 185Investments in subsidiaries 23 295 24 259Investments 708 708Loans receivable 6 600 4 352Amounts owing by group companies 28 598 21 141

Current assets 13 145 3 360

Trade receivables 397 3 206Taxation – 69Term deposits 11 153 –Bank balances 1 595 85

Total assets 73 307 54 005

Equity and liabil it iesCapital and reserves 48 408 47 362

Issued capital 42 488 42 488Distributable reserve 5 919 4 874

Non-current liabilities 1 768 2 835

Other loans payable 1 768 2 835

Current liabilities 23 131 3 808

Taxation 1 439Trade payables 3 158 614Current portion of long-term liabilities 120 –Bank overdraft 18 411 3 194

Total equity and liabilities 73 307 54 005

As at 30 June 2001

2001 2000

R’000 R’000

Company f inancia l s tatementsBalance sheet



1. Cash flow statementThe operations of DigiCore Holdings Limited mainly consisted of the holding of investments and the

receipt of interest and management fees from its subsidiaries. Consequently, a cash flow statement for

the company is not presented as it would not provide meaningful information.

2. Accounting policiesThe company’s accounting policies are as disclosed on page 20.

3. Subsidiary companiesInterest of holding company

Effective Shares Indebtedness

holding % R’000 R’000

DigiCore Electronics (Pty) Limited 100 20 158 7 924

DigiCore Cellular (Pty) Limited 100 0

DigiCore Technology (Pty) Limited 100 1 505

DigiCore International (Pty) Limited 100 1 726

DigiCore Fleet Management (Pty) Limited 100 3 037 15 863

DigiCore Fuel Solutions (Pty) Limited 100 100 1 600


Company f inancia l s tatementsNotes to the annual f inancia l s tatements


Major shareholders

PSG Nominees (Pty) Limited 80 191 479

Pamodzi Investment Holdings Limited 62 206 589

DigiCore Nominees (Pty) Limited 32 149 665

Aberdein Family Settlement Trust 9 105 100

BNS Nominees (Pty) Limited 5 966 750

SR Aberdein Trust 4 527 260

Peregrine Nominees (Pty) Limited 4 417 500

Sharestock Nominees (Pty) Limited 3 437 433

Sanlam Private Investments (Pty) Limited 3 241 400

J H Vlok 3 005 350

Number of Number of

shares % shareholders %

Non-public shareholders –

comprises directors’ interests and

the share incentive trust 97 378 476 40,7 5 1,3

Public shareholders 141 877 637 59,3 394 98,7

239 256 113 100 399 100

At 30 June 2001

Analysis of shareholders


1 – 5 000 170 42,6 458 971 0,19

5 001 – 10 000 42 10,5 377 700 0,16

10 001 – 100 000 120 30,1 4 409 158 1,84

100 001 – 500 000 34 8,5 8 359 393 3,49

500 001 – 1 000 000 10 2,5 6 573 438 2,75

1 000 001 and over 23 5,8 219 077 453 91,57

399 100 239 256 113 100

Category of ordinary shareholders

Individuals 280 70,1 20 093 573 8,40

Bank or nominee companies 97 24,3 94 627 094 39,55

Investment and insurance companies 7 1,8 50 789 216 21,23

Other corporate bodies 15 3,8 73 746 230 30,82

399 100 239 256 113 100

At 30 June 2001

Number of Number of

shareholders % shares %

Analysis of sharehold ing



Notice of annual genera l meet ing

Notice is hereby given that the fourth annual general meeting of shareholders of DigiCore Holdings Limited willbe held in the boardroom of the company at 20 Eddington Crescent, Highveld Technopark, Centurion, on 27 November 2001 at 10:00.

The following business will be dealt with at the annual general meeting of shareholders:

1. To consider and approve the annual financial statements for the year ended 30 June 2001.2. To re-elect directors, Messrs B P Vundla, L E Truter, F W Britz, J J du Plooy, B J Richards, S A Msibi and

U Khumalo, who retire in terms of the articles of association, but being eligible, offer themselves forre-election.

3. To confirm the remuneration of the directors for the year under review.4. To authorise the directors to determine the auditors’ remuneration for the year under review.5. To confirm the re-appointment of the auditors.6. To place the unissued shares under the control of the directors, granting general authority to the directors to

allot and issue the unissued ordinary shares of the company upon such terms and conditions as they in theirsole discretion may determine, subject to the provisions of the Companies Act, 1973, as amended, and therequirements of the JSE Securities Exchange.

7. To approve the following amendment to the DigiCore Holdings Share Trust:To increase the maximum number of shares in respect whereof any one participant shall be entitled to acceptan offer or offers and/or exercise an option or options from 1 000 000 (one million) (0,42% (nought commafour two per centum)) to 5 000 000 (five million) (2,1% (two comma one per centum)) of the company’sordinary issued share capital.

8. To transact any other business as may be transacted at an ordinary general meeting.

Special ResolutionTo pass with or without modification the following special resolution:

“That in terms of the company’s articles of association, the company and any of its subsidiaries be herebyauthorised by way of a general authority, subject to the provisions of the Companies Act, 1973, as amended,and the rules and requirements of the JSE Securities Exchange, to acquire any class of shares in its issued sharecapital from time to time, subject to the following limitations:– the general authority shall only be valid until the company’s next annual general meeting provided that it will

not extend beyond fifteen months from the date this authority is given;– the general share repurchase shall be limited to a maximum of 10% of the company’s issued share capital of

the class of shares being repurchased in existence at the date this authority is granted;– no repurchase of shares shall be made at a price more than 5% above the average, weighted by volume of

sales, of the market value of the ordinary shares in the company for the five business days immediatelypreceding the date of purchase.”

Reason and effectThe general repurchase of shares will be implemented on the JSE Securities Exchange “open market” to amaximum number of 10% of the issued shares as and when the opportunity arises.

The purpose and effect of this special resolution is to grant the company a general authority to acquire itsown shares which general authority shall be valid until the earlier of the next annual general meeting of thecompany or its variation or revocation of such general authority by a special resolution by any subsequentgeneral meeting of the company, provided that it does not extend beyond fifteen months from the date of thisgeneral meeting.

Voting and proxiesA member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend, speak and, ona poll, to vote in his/her stead. A proxy need not be a member.

Proxy forms should be forwarded to reach the company’s registered office or transfer secretaries 48 (forty-eight)hours before the scheduled time of the meeting.

By order of the board

F W BritzCompany secretary

30 September 2001

Registered office Transfer secretaries20 Eddington Crescent Computershare Services LimitedHighveld Technopark 2nd Floor, Edura HouseCenturion 41 Fox Street, Johannesburg


Registered office20 Eddington Crescent

Highveld Technopark

Centurion

Tel (012) 665-7300 Fax (012) 665-5376

Company secretaryF W Britz

20 Eddington Crescent

Highveld Technopark

Centurion

(PO Box 68270, Highveld Park, 0169)

Transfer secretariesComputershare Services Limited

2nd Floor, Edura House

41 Fox Street, Johannesburg, 2001

(PO Box 61051, Marshalltown, 2107)

AuditorsFisher Hoffman PKF (Pretoria) Inc

Registered Accountants and Auditors

103 Club Avenue, Waterkloof Heights

(PO Box 98060, Waterkloof Heights, 0065)

BankersABSA Bank Limited

SponsorPSG Investment Bank

183 Main Road

Rondebosch

7800

Registration number1998/012601/06

Administrat ion

G R A P H I C O R 2 4 0 3 3


Proxy form

DigiCore Holdings Limited(Incorporated in the Republic of South Africa)

Registration number 1998/012601/06

Annual general meetingI/We (name(s) in capital letters)

of

being the holder(s) of shares in the company 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 for me/us at the fourth annual general

meeting of the shareholders of the company to be held on 27 November 2001, at 10:00 and at any adjournment

thereof, at the company’s registered office, 20 Eddington Crescent, Highveld Technopark, Centurion, and to vote

for me/us on my/our behalf in respect of the undermentioned resolutions in accordance with the following

instructions:

In favour of Against Abstain

1. Approval of annual financial statements

2. Election of directors:

B P Vundla

L E Truter

F W Britz

B J Richards

J J du Plooy

S A Msibi

U Khumalo

3. Confirm the remuneration of directors

4. Determine auditors’ remuneration

5. Re-appointment of auditors

6. Unissued shares under the control of directors

7. Amendment to DigiCore Holdings Share Trust

8. Special resolution:

Acquire own shares

Signed at on 2001

Signature assisted by me (where applicable)

digicore loose proxy 24033 11/5/01 12:39 PM Page 1

1. A member may insert the name of a proxy of the member’s choice in the space provided. Should the

name of a proxy not be inserted it will be deemed to be a proxy in favour of the chairman of the meeting.

A proxy need not be a member of the company.

2. A member’s instruction to the proxy must be indicated by the insertion of an “X” or a tick in the

appropriate box/es provided.

3. If a member does not indicate on the form how his/her proxy is to vote, or gives contradictory

instructions, or should any further resolution(s) or any amendment(s) which may properly be put before the

annual general meeting be proposed, the proxy shall be entitled to vote as he/she deems fit.

4. Documentary evidence establishing the authority of a person signing the form of proxy in a representative

capacity must be attached to the form of proxy, unless previously recorded by the company or waived by

the chairman of the annual general meeting.

5. Any alteration or correction made to the proxy must be initialled by the signatory.

6. The completion and lodging of this form of proxy will not preclude the member from attending the annual

general meeting and speaking and voting in person at such meeting to the exclusion of the proxy

appointed in terms thereof, should he/she wish to do so.

7. The form of proxy should be completed and returned to the company’s registered office or transfer

secretaries to be received 48 hours before the meeting.

8. The chairman of the annual general meeting may reject or accept any proxy form which is completed

and/or received other than in compliance with these instructions, provided that he is satisfied as to the

manner in which a member wishes to vote.

Notes to the proxy

digicore loose proxy 24033 11/5/01 12:39 PM Page 2

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digicore cover 24033 11/5/01 12:46 PM Page 1

Documents

World leaders · Profile. . . of the DigiCore Group is to provide and disseminate pertinent ... Frans Britz(35) Group Financial Director* Deon du Rand(41) Managing Director ... company,