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ASTRAPAK ANNUAL REPORT 2006ASTRAPAK ANNUAL REPORT 2006

49

Annual Financial Statements

¬ Report of the independent auditors 50¬ Secretarial certifi cation 50¬ Directors’ responsibility statement 51¬ Directors’ report 52¬ Balance sheets 54¬ Income statements 55¬ Statements of changes in equity 56¬ Reconciliation of previous SA GAAP

to IFRS and restated SA GAAP 57¬ Cash fl ow statements 58¬ Notes to the cash fl ow statements 59¬ Accounting policies 61¬ Notes to the annual fi nancial statements 67¬ Annexure 1 91¬ Linked unitholders’ information – diary 92¬ Linked unitholders’ information – notice of meeting 94¬ Administration 98¬ Form of proxy – linked unitholders 99¬ Notes to proxy 100

Ann

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50ASTRAPAK ANNUAL REPORT 2006

Report of the independent auditors

In accordance with section 268G(d) of the Companies Act, it is hereby certifi ed that the Company has lodged with the Registrar of

Companies all such returns as are required of a public company in terms of the Act and that such returns are true and correct for the

fi nancial period ended 28 February 2006.

Y Cowley G King

Company Secretary Company Secretary

Sandton Sandton

14 July 2006 30 August 2006

Secretarial certifi cation

To the linked unitholders of Astrapak LimitedWe have audited the annual fi nancial statements and group

annual fi nancial statements of Astrapak Limited set out on pages

52 to 90 for the year ended 28 February 2006. These fi nancial

statements are the responsibility of the Company’s directors.

Our responsibility is to express an opinion on these fi nancial

statements based on our audit.

We conducted our audit in accordance with International

Standards on Auditing. Those Standards require that we plan and

perform the audit to obtain reasonable assurance about whether

the fi nancial statements are free of material misstatement. An

audit includes examining, on a test basis, evidence supporting

the amounts and disclosures in the fi nancial statements. An

audit also includes assessing the accounting principles used and

signifi cant estimates made by management, as well as evaluating

the overall fi nancial statement presentation. We believe that our

audit provides a reasonable basis for our opinion.

In our opinion, the fi nancial statements present fairly, in all material

respects, the fi nancial position of the Company and the Group

at 28 February 2006, and the results of their operations and cash

fl ows for the year then ended in accordance with International

Financial Reporting Standards, South African Statements of

Generally Accepted Accounting Practice AC 500 series and in the

manner required by the Companies Act of South Africa.

Deloitte & Touche

Registered Auditors

Per L Taljaard – Partner

30 August 2006

Buildings 1 and 2, Deloitte Place

The Woodlands Offi ce Park, Woodlands Drive

Sandton

National Executive: GG Gelink Chief Executive, AE Swiegers

Chief Operating Offi cer, GM Pinnock Audit, DL Kennedy Tax,

L Geeringh Consulting, MG Crisp Financial Advisory,

L Bam Strategy, CR Beukman Finance, TJ Brown Clients & Markets,

SJC Sibisi Public Sector and Corporate Social Responsibility,

NT Mtoba Chairman of the Board, J Rhynes Deputy Chairman

of the Board

A full list of partners and directors is available on request.


51

Directors’ responsibility statement

The directors of the Company are responsible for the maintenance

of adequate accounting records and the preparation and integrity

of the annual fi nancial statements and related information. The

annual fi nancial statements have been prepared in accordance

with the Companies Act in South Africa, International Financial

Reporting Standards and the AC 500 standards as required by the

Accounting Practices Board.

The Group’s independent auditors, Deloitte & Touche, have

audited the annual fi nancial statements and their unqualifi ed

report appears above.

The directors are also responsible for the systems of internal

control. These are designed to provide reasonable, but not

absolute, assurance as to the reliability of the annual fi nancial

statements, and to adequately safeguard, verify and maintain

accountability of assets, and to prevent and detect material

misstatement and loss. The systems are implemented and

monitored by suitably trained personnel with an appropriate

segregation of authority and duties. Nothing has come to

the attention of the directors to indicate that any material

breakdown in the functioning of these controls, procedures and

systems has occurred during the year under review.

The annual fi nancial statements are prepared on a going

concern basis. Nothing has come to the attention of the

directors to indicate that the Group will not remain a going

concern for the foreseeable future.

The annual fi nancial statements set out on pages 52 to 90

were approved by the Board of Directors and are signed on their

behalf by:

R Crewe-Brown HA Todd

Chief Executive Offi cer Financial Director

Sandton Sandton

30 August 2006 30 August 2006


Directors’ report

The directors’ report on the Company and the Group for the year ended 28 February 2006 is as follows:

Nature of businessThe Group is engaged in the plastic packaging industry, providing products and packaging solutions to manufacturers and retailers of consumer products.

Trading resultsA summary of the Group’s trading results is set out below: RestatedR million 2006 2005Revenue 1 874,0 1 650,2Trading income 221,7 182,7Profit after taxation 147,6 115,1Attributable to linked unit holders 139,0 109,3Earnings per linked unit (cents) 122,5 121,0Headline earnings per linked unit (cents) 125,9 116,6

Share capitalDetails of the authorised and issued share capital are given in note 10 to the annual financial statements.Ten percent of the unissued share capital was placed under the control of the directors in terms of section 221 of the Companies Act 61 of 1973 at the annual general meeting held on 22 September 2005.During the current year, 15 014 583 deferred ordinary par value shares of 0,1 cent each in the authorised and issued shares were converted into 15 014 583 ordinary par value shares of 0,1 cent each. There were no other share issues during the year.

Linked unitsThe ordinary shares are linked to the debentures to form a linked unit in Astrapak Limited. As at 28 February 2006, each linked unit comprised one ordinary share of 0,1 cent each and one debenture of 50 cents each.The holder of a linked unit will be entitled to receive dividends on the equity portion of the linked unit and will receive interest on the debenture portion of the linked unit.

Subsidiaries Details of operating entities are set out in note 29 to the financial statements.A number of special resolutions were passed by subsidiary companies. None of these resolutions is of significance to the linked unitholders in assessing the state of affairs of the Group.

DirectorsThe names of the directors of the Company are listed on pages 12 to 13 of this report.No appointments have been made or resignations accepted during the financial year under review.In accordance with the Company’s Articles of Association, one-third of the directors shall retire at the forthcoming Annual General Meeting but, being eligible, offer themselves for re-

election and shall be deemed not to have vacated their respective offices. (Refer to notice of meeting on page 94 for further details).

Directors’ remunerationThe aggregate remuneration and benefits paid to the executive and non-executive directors of the Group for the year ended 28 February 2006 are set out in the Remuneration Report on pages 46 to 48 of this annual report and notes 17 and 33 to the annual financial statements.

Astrapak Limited Linked Unit Trust SchemeFurther details on the Astrapak Limited Linked Unit Trust Scheme (“the scheme”) and the number of options issued to executive and non-executive directors in terms of such scheme are set out in the Remuneration Report on pages 46 to 48 of this annual report. Mr PC Botha resigned as a trustee of the scheme on 17 January 2006 and Mr AM Chait was appointed in his place, along with the current trustee Mr M Ball.

Profit and losses of subsidiary companiesThe total after-tax profit by subsidiaries attributable to the Group was R197 297 235 (2005: R143 039 939). Subsidiaries incurred losses of R49 685 087 (2005: R27 972 953).

Distribution to linked unitholdersDebenture interest of 5,25 cents (2005: 6,20 cents) per linked unit was paid, totalling R7,1 million (2005: R8,4 million). The interest payment approximates the average prime rate of interest for the financial year ended 28 February 2006. In addition, Astrapak paid an ordinary dividend of 24,75 cents (2005: 16,50 cents) per linked unit totalling R33,4 million (2005: R22,3 million) to linked unitholders for the year ended 28 February 2006. The total combined dividend and debenture interest was 30,00 cents (2005: 22,70 cents) per linked unit totalling R40,5 million (2005: R30,7 million).Both distributions were paid on Monday, 5 June 2006 to linked unitholders recorded in the register on Friday, 2 June 2006. The last date to have traded cum-distribution was Friday, 26 May 2006 and the linked units commenced trading ex-distribution on Monday, 29 May 2006. Linked unit certificates could not be dematerialised or rematerialised between Monday, 29 May 2006 and Friday, 2 June 2006, both days inclusive.

Post balance sheet eventsSubsequent to 1 March 2006, the following events have taken place:• Astrapak KwaZulu-Natal acquired a further 25% of the shares

belonging to the minority shareholders of Tamperpak. Astrapak KwaZulu-Natal now holds 100% of the shares in Tamperpak.

• Astrapak Limited acquired 100% of the shares of Alex White Holdings.

• Astrapak has made an offer, subject to approval by the Competitions Commission, for the assets of Plastform, which forms part of Consol.


53

Directors’ report (continued)

Directors’ interestDirector Benefi cial direct Non-benefi cial indirect Unitholding (%)Interest in linked units as at 28 February 2005 822 673 15 129 348 11,8RAP Upton 53 333 – 0,0R Crewe-Brown 210 460 595 648 0,6M Baglione 153 100 56 700 0,2WJ Venter 190 780 – 0,1PC Botha* – 14 337 000 10,6RT Dalais – 140 000 0,1G Petzer 126 000 – 0,1M Diedloff 89 000 – 0,1Net (sales)/purchases from 1 March 2005 to 28 February 2006 (1 385 706) (14 198 256) (11,5)RAP Upton (219 999) – (0,2)R Crewe-Brown (137 670) – (0,1)M Baglione (143 100) – (0,1)WJ Venter (76 667) – (0,1)PC Botha* – (14 327 000) (10,6)RT Dalais – 128 744 0,1G Petzer (292 000) – (0,2)HA Todd (220 833) – (0,2)M Diedloff (295 437) – (0,2)Exercise of options from 1 March 2005 to 28 February 2006 1 372 500 – 1,0RAP Upton 166 666 – 0,1R Crewe-Brown 150 000 – 0,1WJ Venter 116 667 – 0,1G Petzer 506 667 – 0,4HA Todd 220 833 – 0,2M Diedloff 211 667 – 0,2Interest in linked units as at 28 February 2006 809 467 931 092 1,3R Crewe-Brown 222 790 595 648 0,6M Baglione 10 000 56 700 0,0WJ Venter 230 780 – 0,2PC Botha* – 10 000 0,0RT Dalais – 268 744 0,2G Petzer 340 667 – 0,3M Diedloff 5 230 – 0,0* During the year Mr PC Botha resigned as a trustee of the Astrapak Limited Linked Unit Trust Scheme and the linked units previously allocated to him as non-benefi cial indirect, as a result of his position as

trustee, are now ignored.# The number of linked units held by directors changed as follows between 1 March 2006 and the date of this report:

Interest in linked units as at the date of this report 2 458 570 1 046 092 2,6R Crewe-Brown 472 790 595 648 0,8M Baglione 676 667 56 700 0,5WJ Venter 564 113 – 0,4PC Botha* – 125 000 0,1RT Dalais – 268 744 0,2G Petzer 450 000 – 0,3HA Todd 78 333 – 0,1M Diedloff 216 667 – 0,2

Service contractsIndefi nite-term contracts based on a notice period of three months by either party, have been signed by the following directors: Messrs R Crewe-Brown, HA Todd, WJ Venter, M Baglione and G Petzer. Mr M Diedloff has signed an indefi nite-term contract based on a notice period of one month by either party.

Balance sheetsat 28 February 2006


Group Company

2006Restated

2005 R’000 Notes 2006Restated

2005

ASSETS

764 323 571 967 Non-current assets 453 111 209 333

615 821 480 971 Property, plant and equipment 1 876 976

90 201 42 086 Goodwill 2 – –

27 – Trademarks 3 – –

41 017 32 111 Deferred tax assets 4 12 037 6 737

17 080 16 724 Investments and loans 5 47 744 43 946

177 75 Investment in associate company 6 – –

– – Investment in subsidiaries 7 392 454 157 674

690 916 540 561 Current assets 45 457 53 553

245 192 186 960 Inventories 8 – –

291 183 250 883 Accounts receivable 9 13 685 498

144 456 98 224 Cash and short-term investments 14 31 772 53 055

10 085 4 494 Taxation receivable – –

1 455 239 1 112 528 Total assets 498 568 262 886

EQUITY AND LIABILITIES

731 739 520 530 Total equity 444 177 246 471

135 135 Share capital 10 135 135

199 367 84 302 Share premium 10 199 367 84 302

523 109 405 438 Retained income 171 779 99 173

17 858 Non-distributable reserves 11 – –

5 331 2 803 Capital reserve 5 331 2 803

(79 450) (48 950) Treasury linked units 12 – –

648 509 444 586 Ordinary shareholders’ fund 376 612 186 413

59 616 52 409 Debentures 13 67 565 60 058

708 125 496 995 Equity attributable to linked unitholders of the parent 444 177 246 471

23 614 23 535 Minority interest – –

222 795 194 886 Non-current liabilities – –

144 371 145 058 Long-term interest-bearing debt 14 – –

78 424 49 828 Deferred tax liabilities 4 – –

500 705 397 112 Current liabilities 54 391 16 415

320 614 235 080 Accounts payable 15 35 516 7 303

35 901 41 896 Provisions 16 4 188 2 270

6 260 5 883 Linked unitholders for debenture interest 7 094 6 742

122 173 105 299 Short-term interest-bearing debt 14 7 593 100

15 757 8 954 Taxation payable – –

1 455 239 1 112 528 Total equity and liabilities 498 568 262 886


55Group Company

2006Restated


2005

1 873 962 1 650 227 Revenue – –

(1 376 059) (1 214 518) Cost of sales – –

497 903 435 709 Gross profi t – –

– – Dividends received 61 921 31 835

19 044 17 441 Other operating income 38 264 31 501

(149 923) (129 015) Distribution and selling costs – –

(148 882) (145 060) Administrative and other operating expenses 702 (13 920)

3 530 3 619 Share of results of associate company and joint venture – –

221 672 182 694 Trading income 17 100 887 49 416

– 12 783 Exceptional items 18 – –

221 672 195 477 Profi t from operations 100 887 49 416

3 665 2 416 Investment income 19 11 642 12 166

(40 865) (49 428) Finance costs 19 (18 436) (20 049)

184 472 148 465 Profi t before taxation 94 093 41 533

(36 859) (33 396) Taxation (charge)/credit 20 2 414 1 222

147 613 115 069 Profi t for the year 96 507 42 755

Attributable to:

139 001 109 241 Linked unit holders of the parent

8 612 5 828 Minority interest

147 613 115 069 Profi t for the year

122,5 121,0 Earnings per linked unit (cents) 21

111,8 105,5 Diluted earnings per linked unit (cents) 21

Income statementsfor the year ended 28 February 2006


R’000

Share capital and

premiumRetained income

Non-distributable

reserveDividend

reserveCapitalreserve

Treasurylinked units Debentures

Attributableto linked

unitholders’parent

Minorityinterests

Totalequity

GROUP Balance as at 1 March 2004 108 298 172 2 878 6 215 – (23 208) 47 804 331 969 55 301 387 270SA GAAP and IFRS adjustments (1 975) 1 080 (895) (895)Restated balance as at 1 March 2004 108 296 197 2 878 6 215 1 080 (23 208) 47 804 331 074 55 301 386 375Net profit for the year 109 241 109 241 5 828 115 069Net ordinary dividends paid (6 215) (6 215) (2 740) (8 955)Adjustments to minority interest (34 854) (34 854)Decrease in foreign currency

translation reserve (683) (683) (683)Transfer to deferred tax asset (1 337) (1 337) (1 337)Acquisition of treasury shares (25 742) (25 742) (25 742)Expensing of share-based payments for

the year 1 723 1 723 1 723Issue of shares at a premium 84 329 84 329 84 329Issue of debentures 4 605 4 605 4 605Restated balance as at 28 February 2005 84 437 405 438 858 – 2 803 (48 950) 52 409 496 995 23 535 520 530Net profit for the year 139 001 139 001 8 612 147 613Net ordinary dividends paid (21 330) (21 330) (4 103) (25 433)Adjustments to minority interest (4 430) (4 430)Increase in foreign currency

translation reserve 497 497 497Transfer to deferred tax asset (1 338) (1 338) (1 338)Acquisition of treasury shares (30 500) (30 500) (30 500)Expensing of share-based payments for

the year 2 528 2 528 2 528Issue of shares at a premium 115 065 115 065 115 065Issue of debentures 7 207 7 207 7 207Balance as at 28 February 2006 199 502 523 109 17 – 5 331 (79 450) 59 616 708 125 23 614 731 739COMPANY Balance as at 1 March 2004 108 57 498 – 6 215 – – 54 053 117 874 – 117 874SA GAAP and IFRS adjustments (1 080) 1 080 – –Restated balance as at 1 March 2004 108 36 418 – 6 215 1 080 – 54 053 117 874 – 117 874Net profit for the year 42 755 42 755 42 755Expensing of share-based payments for

the year 1 723 1 723 1 723Net ordinary dividends paid (6 215) (6 215) (6 215)Issues of shares at a premium 84 329 84 329 84 329Issue of debentures 6 005 6 005 6 005Balance as at 28 February 2005 84 437 99 173 – – 2 803 – 60 058 246 471 – 246 471Net profit for the year 96 507 96 507 96 507Expensing of share-based payments for

the year 2 528 2 528 2 528Net ordinary dividends paid (23 901) (23 901) (23 901)Issue of shares at a premium 115 065 115 065 115 065Issue of debentures 7 507 7 507 7 507Balance as at 28 February 2006 199 502 171 779 – – 5 331 – 67 565 444 177 – 444 177

Statements of changes in equityfor the year ended 28 February 2006


57

Group Company

IFRS transition IFRS transition

2005 2004 R’000 2005 2004

Balance sheet

522 338 387 270 Equity as previously reported – SA GAAP 246 525 117 874

– – IFRS adjustments – –

2 803 1 080

Adoption of IFRS 2 – Introduction of capital reserve in respect of

share-based payments 2 803 1 080

(2 803) (1 080)

Adoption of IFRS 2 – Retained income eff ect in respect of share-

based payments (2 803) (1 080)

(1 808) (895) SA GAAP adjustments (54) –

3 957 3 957 Property, plant and equipment depreciation adjustment – –

(5 765) (4 852) Straight-lining of operating leases adjustment (54) –

520 530 386 375 Restated equity – IFRS 246 471 117 874

Income statement

111 877 Profi t attributable to linked unit holders of the parent – SA GAAP 44 532

(1 723) IFRS adjustment (1 723)

(1 723) Adoption of IFRS 2 – Share-based payments (1 723)

(913) SA GAAP adjustments (54)

(913) Straight-lining of operating leases adjustment (54)

– Deferred tax impact on IFRS adjustments –

109 241

Restated profi t attributable to equity holders of

the parent – IFRS 42 755

Reconciliation of previous SA GAAP to IFRS and restated SA GAAP


Group Company

2006Restated


2005

Cash flows from operating activities

327 843 283 577 Cash generated from operations A 58 755 25 834

3 665 2 416 Interest received 11 642 12 166

(33 881) (43 545)

Interest paid (excluding interest distribution

to linked unitholders) (10 509) (13 307)

(20 527) (10 755) Net dividends (paid)/received 38 019 25 620

(31 990) (39 308) Taxation paid B (2 886) (878)

(6 608) (6 834) Interest distribution to linked unitholders (7 575) (7 727)

238 502 185 551 Net cash inflow from operating activities 87 446 41 708

Cash flows from investing activities

– – Increase in investment in subsidiary companies (98 815) (63 049)

(82 883) (17 505) Acquisition of subsidiary companies C – –

1 012 804 Decrease in investment in joint ventures – –

(183 863) (155 398) Additions to property, plant and equipment D (217) (313)

(13 019) (36 616) Decrease in minority shareholders’ interest – –

(7 625) (6 039)

Goodwill on acquisition of minority shareholders’

interests – –

1 574 (11 358) Increase/(decrease) in investment and loans (3 798) 6 417

– 12 500 Proceeds on disposal of investments – –

6 819 11 977 Proceeds on disposal of plant and equipment E – 5

(277 985) (201 634) Net cash outflow from investing activities (102 830) (56 940)

Cash flows from financing activities

– 27 Increase in share capital – 27

115 064 84 302 Increase in share premium 115 065 84 302

7 207 4 605 Increase in debentures 7 507 6 005

(30 500) (25 742) Acquisition of treasury linked units – –

– – Decrease in loans by Group companies (135 964) (33 908)

(12 347) (38 725) Decrease in long-term liabilities – –

(3 014) 7 926 (Decrease)/increase in short-term interest-bearing debt 6 932 (5 685)

76 410 32 393 Net cash inflow/(outflow) from financing activities (6 460) 50 741

36 927 16 310 Net increase/(decrease) in cash and cash equivalents (21 844) 35 509

83 040 66 730 Cash and cash equivalents at the beginning of the year 52 955 17 446

119 967 83 040 Cash and cash equivalents at the end of the year F 31 111 52 955

Cash flow statementsfor the year ended 28 February 2006


59 Group Company

2006Restated

2005 R’000 2006Restated

2005

A. CASH GENERATED FROM OPERATIONS

184 472 148 465 Profi t before taxation 94 093 41 533

Adjustments for:

– – Dividends received (61 921) (31 835)

102 072 89 962 Depreciation 317 280

18 4 666 Amortisation of goodwill and trademarks – –

– (9 171) Profi t on disposal of investments – –

– 4 388 Impairment of assets – –

1 773 (5 380) Loss/(gain) on disposal of property, plant and equipment – (5)

494 1 251 Translation diff erences on investments and loans – –

(3 530) (3 619) Share of results of associates and joint venture – –

2 528 1 723 Equity accounted share option expenses 2 528 1 723

(3 665) (2 416) Interest received (11 642) (12 166)

40 865 49 428 Finance costs (including debenture interest distribution) 18 436 20 049

325 027 279 297 Operating income before working capital changes 41 811 19 579

Adjustments for working capital changes:

(45 907) (44 479) Increase in inventories – –

(16 834) 19 891 (Increase)/decrease in accounts receivable (13 187) 1 482

65 557 28 868 Increase in accounts payable 30 131 4 773

2 816 4 280 16 944 6 255

327 843 283 577 58 755 25 834

B. TAXATION PAID

4 460 12 416 Amounts unpaid at the beginning of the year – –

3 919 460 Taxation balances acquired – –

29 283 30 892 Amounts charged to income statement 2 886 878

(5 672) (4 460) Amounts unpaid at the end of the year – –

31 990 39 308 2 886 878

Notes to the cash fl ow statementsfor the year ended 28 February 2006


Group Company

2006Restated

2005 R’000 2006Restated

2005

C. ACQUISITION OF SUBSIDIARY COMPANIES

Fair value of assets acquired 61 651 10 817 Property, plant and equipment – –

(11 292) (656) Deferred taxation – –(11 662) (6 026) Long-term liabilities – –23 466 7 480 Accounts receivable – –23 401 2 973 Cash resources – –12 325 4 460 Inventory – –

(12 933) (7 429) Accounts payable – –(3 919) (460) Taxation – –

(10 584) (2 873) Current portion of long-term liabilities – –(247) – Dividends payable – –

21 – Investments – –(4 478) – Minority shareholders – –

45 – Trademarks – –65 794 8 286 – –

Less: (23 401) (2 973) Cash resources acquired – –

Add: 40 490 12 192 Goodwill on acquisition – –82 883 17 505 Cash outflow arising on acquisition – –

D. ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT

168 898 151 819 Plant, equipment and furniture 217 2133 071 1 740 Motor vehicles – 88

10 764 1 675 Leasehold improvements – 121 130 164 Land and buildings – –

183 863 155 398 217 313The above-listed additions to property, plant and

equipment consist of: 166 026 118 525 Expansion – –

17 837 36 873 Replacement 217 313183 863 155 398 217 313

E. PROCEEDS ON DISPOSAL OF

PLANT AND EQUIPMENT

8 592 6 597 Net book value of disposals – –(1 773) 5 380 (Loss)/gain on disposal of property, plant and equipment – 56 819 11 977 – 5

F. CASH AND CASH EQUIVALENTS

AT THE END OF THE YEAR

144 456 98 224 Cash and short-term investments 31 772 53 055(24 489) (15 184) Bank overdrafts (661) (100)

119 967 83 040 31 111 52 955

Notes to the cash flow statements (continued)for the year ended 28 February 2006


611. GENERAL INFORMATION

Astrapak Limited is a company incorporated under

the Companies Act of South Africa. The address of the

registered offi ce is given on page 98. The nature of the

Group’s operations and its principal activities are set out on

pages 6 to 11 and the operating and fi nancial review on

pages 21 to 31.

These fi nancial statements are presented in South African

Rands because that is the currency of the primary

economic environment in which the Group operates.

The fi nancial statements have been prepared in accordance

with International Financial Reporting Standards (‘IFRS’) for

the fi rst time.

The impact of these changes in accounting policies is

discussed in detail later in note 31. The impact on basic and

diluted earnings per share is disclosed in note 21.

The adoption of these new and revised Standards and

Interpretations has resulted in changes to the Group’s

accounting policies in the following areas that have

aff ected the amounts reported for the current or prior years:

• share-based payments (IFRS 2);

• goodwill (IFRS 3); and

• property, plant and equipment (IAS 16).

The fi nancial statements have been prepared on the

historical cost basis except for revaluation of certain

fi nancial instruments. The principal accounting policies

adopted are set out below.

2. BASIS OF CONSOLIDATION

The consolidated fi nancial statements incorporate the

fi nancial statements of the Company and entities controlled

by the Company (its subsidiaries) made up to 28 February

each year. Control is achieved where the Company has the

power to govern the fi nancial and operating policies of an

investee entity so as to obtain benefi ts from its activities.

On acquisition, the assets and liabilities and contingent

liabilities of a subsidiary are measured at their fair values

at the date of acquisition. The acquisition of subsidiaries

Accounting policiesfor the year ended 28 February 2006

is accounted for using the purchase method. Any excess

of the cost of acquisition over the fair values of the

identifi able net assets acquired is recognised as goodwill.

Any defi ciency of the cost of acquisition below the fair

values of the identifi able net assets acquired (i.e. discount

on acquisition) is credited to profi t and loss in the period of

acquisition. The interest of minority shareholders is stated at

the minority’s proportion of the fair values of the assets and

liabilities recognised. Subsequently, any losses applicable to

the minority interest in excess of the minority interest are

allocated against the interests of the parent.

The results of subsidiaries acquired or disposed of during

the year are included in the consolidated income statement

from the eff ective date of acquisition or up to the eff ective

date of disposal, as appropriate.

Where necessary, adjustments are made to the fi nancial

statements of subsidiaries to bring the accounting policies

used into line with those used by the Group.

All intra-group transactions, balances, income and expenses

are eliminated on consolidation.

3. INVESTMENTS IN ASSOCIATES

An associate is an entity over which the Group is in a

position to exercise signifi cant infl uence, but not control

or joint control, through participation in the fi nancial and

operating policy decisions of the investee.

The results and assets and liabilities of associates are

incorporated in these fi nancial statements using the equity

method of accounting except when classifi ed as held for sale,

in which case it is accounted for under IFRS 5.

Investments in associates are carried in the balance sheet

at cost as adjusted by post-acquisition changes in the

Group’s share of the net assets of the associate, less any

impairment in the value of individual investments. Losses

of the associates in excess of the Group’s interest in those

associates are not recognised.

Any excess of the cost of acquisition over the Group’s

share of the fair values of the identifi able net assets of

the associate at the date of acquisition is recognised as


Accounting policies (continued)for the year ended 28 February 2006

goodwill. Any deficiency of the cost of acquisition below

the Group’s share of the fair values of the identifiable

net assets of the associate at the date of acquisition (i.e.

discount on acquisition) is credited in profit and loss in the

period of acquisition.

Where a Group company transacts with an associate of the

Group, profits and losses are eliminated to the extent of

the Group’s interest in the relevant associate. Losses may

provide evidence of an impairment of the asset transferred,

in which case appropriate provision is made for impairment.

4. JOINT VENTURES

A joint venture is a contractual arrangement whereby the

Group and outside parties undertake an economic activity,

which is subject to joint control.

Joint venture arrangements undertaken in a separate entity

are referred to as jointly-controlled entities. The Group

reports its interests in jointly-controlled entities using the

equity method, in terms of which the post-acquisition

results of the joint venture are included in the income

statement.

5. GOODWILL

Goodwill arising on consolidation represents the excess

of the cost of acquisition over the Group’s interest in

the fair value of the identifiable assets and liabilities of a

subsidiary, associate or jointly-controlled entity at the date

of acquisition.

Goodwill is initially recognised as an asset at cost and

reviewed for impairment at least annually. Any impairment

is recognised immediately in profit or loss and is not

subsequently reversed.

On disposal of a subsidiary, associate or jointly-controlled

entity, the attributable amount of goodwill is included in

the determination of the profit or loss on disposal.

Goodwill arising on acquisitions before the date of

transition to IFRS has been retained at the previous

South African GAAP amounts, subject to being tested for

impairment at that date.

Goodwill written off to share premium under South African

GAAP in 1998 has not been reinstated and is not included

in determining any subsequent profit or loss on disposal.

6. REVENUE RECOGNITION

Revenue is measured at the fair value of the consideration

received or receivable and represents amounts receivable

for goods and services provided in the normal course of

business, net of trade discounts, VAT and other sales-related

taxes.

Sales of goods are recognised when goods are delivered

and title has passed.

Interest income is accrued on a time basis, by reference to

the principal outstanding and at the effective interest rate

applicable.

Dividend income from investments is recognised when

the shareholders’ rights to receive payment have been

established.

7. LEASING

Leases are classified as finance leases whenever the terms

of the lease transfer substantially all the risks and rewards

of ownership to the lessee. All other leases are classified as

operating leases.

Assets held under finance leases are recognised as assets

of the Group at their fair value or, if lower, at the present

value of the minimum lease payments, each determined

at the inception of the lease. The corresponding liability

to the lessor is included in the balance sheet as a finance

lease obligation. Lease payments are apportioned between

finance charges and reduction of the lease obligation so

as to achieve a constant rate of interest on the remaining

balance of the liability. Finance charges are charged directly

against income, unless they are directly attributable to

qualifying assets, in which case they are capitalised in

accordance with the Group’s general policy on borrowing

costs (see below).


63 Rentals payable under operating leases are charged to

income on a straight-line basis over the term of the relevant

lease.

Benefi ts received and receivable as an incentive to enter

into an operating lease are also spread on a straight line

basis over the lease term.

8. FOREIGN CURRENCIES

Transactions in currencies other than South African Rands

are recorded at the rates of exchange prevailing on the

dates of the transactions. At each balance sheet date,

monetary assets and liabilities that are denominated in

foreign currencies are retranslated at the rates prevailing

on the balance sheet date. Non-monetary assets and

liabilities carried at fair value that are denominated in

foreign currencies are translated at the rates prevailing at

the date when the fair value was determined. Gains and

losses arising on re-translation are included in net profi t or

loss for the period, except for exchange diff erences arising

on non-monetary assets and liabilities where the changes

in fair value are recognised directly in equity.

To hedge its exposure to certain foreign exchange risks, the

Group enters into forward contracts and options (see below

for details of the Group’s accounting policies in respect of

such derivative fi nancial instruments).

9. BORROWING COSTS

Borrowing costs directly attributable to the acquisition,

construction or production of qualifying assets, which are

assets that necessarily take a substantial period of time

to prepare for their intended use or sale, are added to

the cost of those assets, until such time as the assets are

substantially ready for their intended use or sale. Investment

income earned on the temporary investment of specifi c

borrowings, pending their expenditure on qualifying

assets, is deducted from the borrowing costs eligible for

capitalisation.

All other borrowing costs are recognised in profi t or loss in

the period in which they are incurred.

10. GOVERNMENT GRANTS

Government grants are recognised as income over the

periods necessary to match them with the related costs.

11. PROFIT FROM OPERATIONS

Profi t from operations is stated after the share of results of

associates but before investment income and fi nance costs.

12. RETIREMENT BENEFIT COSTS

Payments to defi ned contribution retirement benefi t

schemes are charged as an expense as they fall due.

13. IMPAIRMENT, EXCLUDING GOODWILL

On an annual basis, the Group reviews all assets, both

tangible and intangible, carried on the balance sheet for

impairment. Where the recoverable amount of an asset

or cash-generating unit is estimated to be lower than its

carrying amount, its carrying amount is reduced to its

recoverable amount. Impairment losses are charged against

income in the period in which they are identifi ed.

Where an impairment loss subsequently reverses the

carrying amount of the asset or cash-generating unit is

increased to the revised estimate of its recoverable amount,

such increase in carrying amount is limited to the orignial

cost. A reversal of an impairment loss is recognised in

income in the period in which such reversal is identifi ed.

14. TAXATION

The tax expense represents the sum of the tax currently

payable and deferred tax.

The tax currently payable is based on taxable profi t for the

year. Taxable profi t diff ers from net profi t as reported in the

income statement because it excludes items of income or

expense that are taxable or deductible in other years and it

further excludes items that are never taxable or deductible.

The Group’s liability for current tax is calculated using tax

rates that have been enacted or substantively enacted by

the balance sheet date.




Deferred tax is the tax expected to be payable or

recoverable on differences between the carrying amounts

of assets and liabilities in the financial statements and

the corresponding tax bases used in the computation of

taxable profit, and is accounted for using the balance sheet

liability method.

Deferred tax liabilities are generally recognised for all

taxable temporary differences and deferred tax assets are

recognised to the extent that it is probable that taxable

profits will be available against which deductible temporary

differences can be utilised. Such assets and liabilities are not

recognised if the temporary difference arises from goodwill

or from the initial recognition (other than in a business

combination) of other assets and liabilities in a transaction

that affects neither the tax profit nor the accounting profit.

Deferred tax liabilities are recognised for taxable temporary

differences arising on investments in subsidiaries and

associates, and interests in joint ventures, except where

the Group is able to control the reversal of the temporary

difference and it is probable that the temporary difference

will not reverse in the foreseeable future.

The carrying amount of deferred tax assets is reviewed at

each balance sheet date and reduced to the extent that it

is no longer probable that sufficient taxable profits will be

available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected

to apply in the period when the liability is settled or the

asset is realised. Deferred tax is charged or credited in the

income statement, except when it relates to items charged

or credited directly to equity, in which case the deferred tax

is also dealt with in equity.

15. PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment are accounted for at cost

less accumulated depreciation and any accumulated

impairment. All direct costs, including finance costs relating

to major capital projects, are capitalised up to the date of

commissioning.

Depreciation is charged so as to write off the cost of assets,

other than freehold land, over their estimated economic

useful lives, using the straight-line method. Depreciation is

not provided for on freehold land.

Owner-occupied property, defined as property held for use

in the supply of services or for administration purposes,

is valued at cost less provisions for impairment of value,

where appropriate. Depreciation is provided against the

gross cost of the properties, taking into account the residual

value and estimated life of the property.

Residual values and estimated useful lives are assessed on

an annual basis.

The gain or loss arising on the disposal or scrapping of

property, plant and equipment is recognised in the income

statement.

16. TRADEMARKS

Trademarks are measured initially at purchase cost and

are amortised on a straight-line basis over their estimated

useful lives.

17. INVENTORIES

Inventories are stated at the lower of cost and net

realisable value. Cost comprises direct materials and, where

applicable, direct labour costs and those overheads that

have been incurred in bringing the inventories to their

present location and condition. Cost is calculated using

the first-in first-out method. Net realisable value represents

the estimated selling price less all estimated costs of

completion and costs to be incurred in marketing, selling

and distribution.

18. FINANCIAL INSTRUMENTS

Financial assets and financial liabilities are recognised on

the Group’s balance sheet when the Group has become a

party to contractual provisions of the instrument.

Trade receivables and payables are measured at initial

recognition at fair value, and are subsequently measured

at amortised cost using the effective interest rate method.


65Appropriate allowances for estimated irrecoverable trade

payables are recognised in profi t or loss when there is

objective evidence that the asset is impaired.

Cash and cash equivalents comprise the net of cash on

hand and overdrafts, demand deposits, and other short-

term highly liquid investments that are readily convertible

to a known amount of cash and are subject to an

insignifi cant risk of changes in value.

Interest-bearing bank loans and overdrafts are recorded

at the proceeds received, net of direct issue costs. Finance

charges, including premiums payable on settlement or

redemption, are accounted for on an accrual basis to the

income statement using the eff ective interest rate method

and are added to the carrying amount of the instrument to

the extent they are not settled in the period in which they

arise.

Equity instruments are recorded at the proceeds received,

net of direct issue costs.

The Group uses derivative fi nancial instruments, primarily

foreign currency forward contracts, to hedge its risks

associated with foreign currency. The Group does not use

derivative fi nancial instruments for speculative purposes.

The fair value of these derivatives is recorded and

remeasured at each reporting date.

Changes in fair value of derivative fi nancial instruments

that are designated and eff ective as hedges of future

cash fl ows relating to fi rm commitments and forecasted

transactions are recognised directly in equity. If the hedged

fi rm commitment or forecast transaction results in the

recognition of an asset or a liability, then, at the time the

asset or liability is recognised, the associated gain or loss

on the derivative that had previously been recognised in

equity is included in the initial measurement of the asset or

liability.

Hedge accounting is discontinued when the hedging

instrument expires or is sold, terminated, exercised or

no longer qualifi es for hedge accounting. At that time,

any cumulative gain or loss on the hedging instrument

recognised in equity is retained in equity until the

forecast transaction occurs. If a hedged transaction is no

longer expected to occur, the net cumulative gain or loss

recognised in equity is transferred to net profi t or loss for

the period.

Changes in fair value of derivative fi nancial instruments that

do not qualify for hedge accounting are recognised in the

income statement as they arise.

19. PROVISIONS

Provisions are raised when a present obligation exists as

a result of a past event and it is probable that an outfl ow

of resources will be required to settle the obligation, and

a reliable estimate can be made of the amount of the

obligation.

20. SHARE-BASED PAYMENTS

The Group has applied the requirements of IFRS 2 Share-

based Payments. In accordance with the transitional

provisions, IFRS 2 has been applied to all grants of equity

instruments after 7 November 2002 that were unvested as

of 1 March 2005.

The Group issues equity-settled share-based payments to

certain employees.

Equity-settled share-based payments are measured at fair

value at the date of grant. The fair value determined at the

grant date of the equity-settled share-based payments is

expensed on a straight-line basis over the vesting period,

based on the Group’s estimate of shares that will eventually

vest.

Fair value is measured by use of a binomial model. The

expected life used in the model has been adjusted,

based on management’s best estimate, for the eff ects of

non-transferability, exercise restrictions, and behavioural

considerations.

Accounting policies (continued)



21. SEGMENTAL REPORTING

For management purposes, the Group is organised into

business clusters on the basis of operational types. These

clusters are the basis on which the Group reports its primary

segment information. The principal activities of the clusters

are as follows:

• Films

Manufacturers of high-density polyethylene films, low-

density single- and multi-layered films, plain and printed

films, co-extruded film, blown film, film for pallet stretch

wrap and industrial pallet shrink shroud.

• Rigids

Manufacturers of plastic closures for rigid containers and

jars, clear packaging containers, industrial cores, tubes

and composite cans, paper edgeboard used for pallet

stabilisation, and blow-moulding and decoration of rigid

plastic containers and jars.

• Flexibles

Manufacturers of high-tech polyethylene stretch labels,

PVC shrink labels, wraparound polypropylene labels,

tamper-evident seals, decorated stand-up pouches and

converters and distributors of specialist printed mono- and

composite films.

In addition, the businesses are grouped by geographical

location. The main geographic regions identified are:

• Gauteng;

• Cape; and

• KwaZulu-Natal.

Geographic split is determined by location of the operating

assets.

22. HEADLINE EARNINGS PER LINKED UNIT

The Group has followed the recommendation contained in

Circular 7/2002 Headline Earnings issued by SAICA and has

published headline earnings per linked unit in addition to

attributable earnings per linked unit. Headline earnings per

linked unit have been calculated in accordance with the

requirements of Circular 7/2002. Attributable profit per linked

unit has been based on earnings attributable, including

interest, to linked unitholders.


67

R’000

Land

and

buildings

Plant,

equipment

and furniture

Motor

vehicles

Leasehold

improvements Total

1. PROPERTY, PLANT AND EQUIPMENT

Group 2006

Cost

Balance at the beginning of the year 68 585 828 952 11 730 9 242 918 509

Additions 1 130 168 898 3 071 10 764 183 863

Acquisition of business – 103 539 3 378 – 106 917

Disposals – (69 538) (1 410) – (70 948)

Balance at the end of the year 69 715 1 031 851 16 769 20 006 1 138 341

Accumulated depreciation



Charge for the year 2 963 95 335 2 272 1 502 102 072

Depreciation on disposals – (62 360) 4 – (62 356)

Balance at the end of the year 24 085 480 198 11 816 6 421 522 520

Net book value at 28 February 2006 45 630 551 653 4 953 13 585 615 821

Restated net book value at 28 February 2005 47 463 425 448 3 737 4 323 480 971

Group 2005

Cost


Additions 164 151 819 1 740 1 675 155 398


Disposals (5 856) (7 112) (2 388) – (15 356)


Accumulated depreciation


Acquisition of business – 12 227 615 – 12 842

Charge for the year 3 162 84 610 1 351 839 89 962

Depreciation on disposals (1 880) (5 445) (1 434) – (8 759)




Notes to the annual fi nancial statements for the year ended 28 February 2006


Notes to the annual financial statements (continued)for the year ended 28 February 2006

R’000 Cost

Accumulated

depreciation

Net book

value

1. PROPERTY, PLANT AND EQUIPMENT (continued)Reconciliation of net book value at 28 February 2006Land and buildings 69 715 24 085 45 630Plant, equipment and furniture 1 031 851 480 198 551 653Motor vehicles 16 769 11 816 4 953Leasehold improvements 20 006 6 421 13 585

1 138 841 522 520 615 821

R’000

Motor

vehicles

Plant,

equipment

and furniture

Leasehold

improvements Total

Company 2006 Cost Balance at the beginning of the year 88 1 389 346 1 823Additions – 217 – 217Balance at the end of the year 88 1 606 346 2 040Accumulated depreciation Balance at the beginning of the year 15 689 143 847Charge for the year 17 246 54 317Balance at the end of the year 32 935 197 1 164Net book value at 28 February 2006 56 671 149 876Net book value at 28 February 2005 73 700 203 976Company 2005 Cost Balance at the beginning of the year – 1 179 334 1 513Additions 88 213 12 313Disposals – (3) – (3)Balance at the end of the year 88 1 389 346 1 823Accumulated depreciation Balance at the beginning of the year – 487 83 570Charge for the year 15 205 60 280Disposals – (3) – (3)Balance at the end of the year 15 689 143 847Net book value at 28 February 2005 73 700 203 976Net book value at 29 February 2004 – 692 251 943

R’000 Cost

Accumulated

depreciation

Net book

valueReconciliation of net book value at 28 February 2006 Motor vehicles 88 32 56Plant, equipment and furniture 1 606 935 671Leasehold improvements 346 197 149

2 040 1 164 876

Assets are encumbered as detailed in note 14.Details of land and buildings are included in annexure 1. Assets held under finance lease are depreciated over the lesser of the expected useful life or the term of the related lease.Plant and equipment 8 yearsFurniture and computer equipment 3 to 5 yearsMotor vehicles 5 yearsLeasehold improvements 5 yearsBuildings 20 yearsTrademarks 3 to 5 years


69 Group Company

2006Restated

2005 R’000 2006Restated

2005

2. GOODWILL

42 086 28 521 Balance at the beginning of the year – –Purchases during the year:

7 625 6 039 • minority interests purchased – –

24 209 – • acquisition of 100% of Hilfort Plastics – –

16 281 – • acquisition of 60% of Consupaq – –

– 2 347 • acquisition of 50% of Marcom Plastics – –

– 9 845 • acquisition of 70% of Knilam Packaging– (4 666) Amortisation for the year – –

90 201 42 086

Cost after elimination of amortisation accumulated prior to

the adoption of IFRS 3 – –Reconciliation of net goodwill as at 28 February

90 201 56 509

Cost (2006: after elimination of amortisation accumulated

prior to the adoption of IFRS 3) – –– (14 423) Accumulated amortisation – –

90 201 42 086 Net carrying value – –

3. TRADEMARKS

45 – Acquisition of 60% of Consupaq – –(18) – Amortisation for the year – –27 – Total – –

Reconciliation of net trademarks as at 28 February45 – Cost – –

(18) – Accumulated amortisation – –27 – Net carrying value – –

4. DEFERRED TAX

83 247 26 901

Accelerated wear and tear for tax purposes

on plant and equipment – –(4 823) 22 927 Other temporary diff erences – –

(41 017) (32 111) Estimated tax losses (12 037) (6 737)37 407 17 717 Net deferred tax liability/(asset) (12 037) (6 737)

Reconciliation betweeen deferred tax opening

and closing balances:17 717 13 268 Net deferred tax liability/(asset) at the beginning of the year (6 737) (4 637)(8 906) (9 945) Increase of tax losses (5 300) (2 100)

56 346 15 209

Net originating temporary diff erences

on plant and equipment – –1 338 1 337 Transfer from non-distributable reserve (note 11) – –

(29 088) (2 152) Other temporary diff erences – –37 407 17 717 Net deferred tax liability/(asset) at the end of the year (12 037) (6 737)

Analysed between:(41 017) (32 111) Deferred tax assets (12 037) (6 737)78 424 49 828 Deferred tax liabilities – –

37 407 17 717 Net deferred tax liability/(asset) at the end of the year (12 037) (6 737)

Notes to the annual fi nancial statements (continued)for the year ended 28 February 2006



Group Company

2006Restated

2005 R’000 2006Restated

2005

5. INVESTMENTS AND LOANSInvestments Unlisted

7 452 5 441

Investment in label printing Mauritian Joint Venture

(49,5% interest held) – –776 776 Investment to date at cost – –

14 494 11 578 Equity accounted profit to date (after tax) – –(5 533) (4 520) Dividends received to date – –(2 285) (2 393) Foreign exchange translation differences to date – –

9 589 11 283

10 949 057 (2005: 12 500 125) cumulative redeemable preference shares at R1 each in Really Useful Investments No 43 (Pty) Ltd – –

17 041 16 724 – –Listed

28 – First Rand Limited (1 505 ordinary shares) – –3 – Sanlam Limited (499 ordinary shares) – –8 – Old Mutual Limited (700 ordinary shares) – –

39 – – –17 080 16 724 Total investments – –

Loans– – Loan to/(from) Astrapak Property Development (Pty) Limited 6 620 (2 112)– – Loan to Astrapak Limited Linked Unit Trust Scheme 41 124 46 058

The loans are non-interest bearing, unsecured and have no fixed terms of repayment

17 080 16 724 Total 47 744 43 94617 041 16 724 Directors’ valuation of unlisted investments – –

50 – Market value of listed investments – –Included in the financial results of the Mauritian Joint

Venture, Standard Labels Limited, at 28 February is: 13 901 14 376 Current assets

8 028 8 983 Non-current assets 4 118 5 483 Current liabilities 9 783 5 183 Non-current liabilities

21 697 19 300 Revenue12 930 11 134 Retained profit for the year

6. INVESTMENT IN ASSOCIATE COMPANY177 75 Unlisted – Izakhamzi Plastics (Pty) Ltd (20% interest held) – –

4 970 3 940 Current assets – –563 583 Non-current – –

3 681 3 223 Current liabilities – –444 400 Non-current liabilities – –

20 946 23 898 Revenue – –177 75 Equity accounted profit to date – –177 75 Directors’ valuation of unlisted investment – –

7. INVESTMENT IN SUBSIDIARIES– – Shares at cost 384 761 285 945– – Indebtedness 7 693 (128 271)– – Total 392 454 157 674– – Directors’ valuation 392 454 157 674

Refer note 29 for further details Inventories amounting to R485 981 (2005: R857 716) are carried at net realisable value.


71 Group Company

2006Restated

2005 R’000 2006Restated

2005

8. INVENTORIES114 667 79 174 Raw materials – –

31 006 24 866 Work in progress – –87 393 74 158 Finished goods – –12 126 8 762 Consumable stores – –

245 192 186 960 Total – –

9. ACCOUNTS RECEIVABLE268 182 239 744 Trade receivables – –

(8 903) (10 420) Less: Provision for bad debts – –259 279 229 324 – –

11 180 10 387 Prepayments 128 –20 724 11 172 Other (including VAT receivable, deposits, etc) 13 557 498

291 183 250 883 Total 13 685 498

10. SHARE CAPITAL AND SHARE PREMIUM Authorised share capital Ordinary share capital

200 185

200 000 000 (2005: 184 985 417)

shares of 0,1 cent per share 200 185Deferred ordinary share capital

– 15 Nil (2005: 15 014 583) shares of 0,1 cent per share – 15Issued share capital

Ordinary shares of 0,1 cent

per share

Deferred ordinaryshares of 0,1 cent

per share

Numberof shares R’000

Numberof shares R’000

Sharepremium

R’000


Conversion of deferred ordinary shares

issued during the year at a premium 15 014 583 15 (15 014 583) (15) 117 556

135 131 250 135 – – 201 858

Less: Share issue expenses – – – – (2 491)

Balance at the end of the year 135 131 250 135 – – 199 367

Group Company

2006 2005 R’000 2006 2005

11. NON-DISTRIBUTABLE RESERVES858 2 878 Balance at the beginning of the year – –

(841) (2 020) Movements in non-distributable reserves – –17 858 Balance at the end of the year – –

Comprising:

1 336 2 673

Non-distributable reserve created in previous years as a

result of a change in accounting policy relating to the

amortisation of intangible assets – –(1 319) (1 815) Foreign currency translation reserve – –

17 858 – –




Group Company

2006Restated

2005 R’000 2006Restated

2005

39 648 41 358

12. TREASURY LINKED UNITS

12 085 006 (2005: 14 327 000) linked units

registered in the name of the Astrapak Limited

Linked Unit Trust Scheme – –

39 802 7 592

3 814 132 (2005: 971 125) linked units purchased

by nominee – –

79 450 48 950 – –

13. DEBENTURES

Authorised

100 000 100 000

200 000 000 unsecured variable rate redeemable

debentures of 50 cents each 100 000 100 000

Issued

67 565 60 058

135 131 250 (2005: 120 116 667) unsecured variable

rate redeemable debentures of 50 cents each 67 565 60 058

(6 042) (7 164)

12 085 006 (2005: 14 327 000) unsecured variable rate

redeemable debentures of 50 cents each held in treasury

linked units – –

(1 907) (485)

3 814 132 (2005: 971 125) unsecured variable rate

redeemable debentures of 50 cents each held by nominee – –

59 616 52 409 67 565 60 058

14. INTEREST-BEARING DEBT AND CASH

14.1 Long term

Secured debt

183 539 147 826 Instalment sale agreements (variable rate) – –

Other variable rate loans:

7 215 1 063 • monthly instalments 6 932 –

Other fixed rate loans:

2 257 10 451 • quarterly instalments – –

49 045 75 833 • bi-annual instalments – –

242 056 235 173 Total secured debt 6 932 –

(97 685) (90 115)

Current portion transferred to short-term

interest-bearing debt (6 932) –

144 371 145 058 Net long-term interest-bearing debt – –

The instalment sale agreements and other variable rate loans are secured by the related property, plant and equipment with net book values of R193 337 718 (2005: R177 486 893). Refer note 1.

Variable rate loans These loans bear interest at variable money market rates ruling at the roll-over dates. Redemption is reviewed and rolled forward. Security is provided by the underlying property and cession of key man insurance policies.

Fixed rate loans The loan repayable in quarterly instalments bears interest at 11,85% per annum, and is repayable at R2 292 322 per quarter. The loan repayable in bi-annual instalments bears interest at 16% per annum, and is repayable in bi-annual instalments of R18 855 416. The fixed rate loans are secured by a group security pooling arrangement over the assets of the business.The directors consider the carrying amounts of all loans to approximate their fair values.


73 Group Company

2006 2005 R’000 2006 2005

14. INTEREST-BEARING DEBT AND CASH (continued)

14.1 Long term (continued)

Analysis of repayments

Repayable during the twelve months to:

– 90 115 28 February 2006 – –

97 685 98 651 28 February 2007 6 932 –

96 208 31 090 29 February 2008 –

26 253 10 594 28 February 2009 – –

15 479 5 123 28 February 2010 – –

6 431 – Thereafter – –

242 056 235 173 Total repayments 6 932 –

14.2 Short-term interest-bearing debt

24 488 15 184 Bank overdrafts 661 100

97 685 90 115 Current portion of long-term interest-bearing debt 6 932 –

122 173 105 299 7 593 100

(144 456) (98 224) 14.3 Cash and short-term investments (31 772) (53 055)

14.4 Net interest-bearing debt/(cash)

144 371 145 058 Long-term interest-bearing debt – –

122 173 105 299 Short-term interest-bearing debt 7 593 100

(144 456) (98 224) Cash and short-term investments (31 772) (53 055)

122 088 152 133 (24 179) (52 955)

The Group evaluated numerous capital allocation opportunities during the year under review and invested to achieve an optimal result

for linked unitholders. The opportunities that were pursued were funded partly by debt and partly by the cash generated from within the

Group. This resulted in a net interest-bearing debt of R122,1 million (2005: R152,1 million). The major capital allocations were as follows:

• R183,4 million for plant replacement as well as expansionary capital expenditure;

• R13,0 million for the purchase of certain minority interests; and

• R82,9 million for the purchase of subsidiaries.

Where possible the eff ect of these capital allocations on headline earnings has been disclosed in note 21 of the report. In accordance

with the provisions of the Articles of Association adopted by the Company on 17 September 1997, the borrowing powers of the directors

are unlimited.




Group Company

2006Restated

2005 R’000 2006Restated

2005

15. ACCOUNTS PAYABLE

223 671 177 624 Trade payables – –

96 943 57 456 Accruals 35 516 7 303

320 614 235 080 Total 35 516 7 303

R’000 Royalties

Leave

pay Bonuses

Distributor

commis-

sions

Credit

notes Other Total

16. PROVISIONS – GROUP

Opening balance – 6 701 16 285 5 261 2 070 11 579 41 896

Additions 57 8 802 17 405 940 1 404 7 293 35 901

Usage – (6 701) (16 285) (5 261) (2 070) (11 579) (41 896)

Closing balance 57 8 802 17 405 940 1 404 7 293 35 901

PROVISIONS – COMPANY

Opening balance – 244 2 026 – – – 2 270

Additions – 201 3 987 – – – 4 188

Usage – (244) (2 026) – – – (2 270)

Closing balance – 201 3 987 – – – 4 188

Other provisions consist of provisions for repairs and maintenance, volume discounts and

settlement discounts. All the provisions are expected to be utilised in full during the next

financial year.

Group Company

2006Restated

2005 R’000 2006Restated

2005

17. TRADING INCOME

Trading income has been determined after taking into

account the items detailed below:

Income:

1 430 132 Government grants – –

641 586 Foreign exchange gains – –

– 5 380 Net gain on disposal of property, plant and equipment 5

– 9 171 Profit on disposal of investments – –

372 – Reversal of write-down of inventory to net realisable value – –

Expenses:

Auditors’ remuneration

2 315 1 536 • audit fees 269 106

100 24 • prior year under provision – –

149 42 • tax advisory services – –

– 658 Write-down of inventory to net realisable value – –

2 564 1 602 269 106


75 Group Company

2006Restated

2005 R’000 2006Restated

2005

17. TRADING INCOME (continued)

Directors’ emoluments

Non-executive directors

• Number of non-executive directors 5 5

• Fees for services as a director 510 375

• Fees for services as committee members 195 200

• Fees for consulting services 851 973

1 556 1 548

Executive directors

• Number of executive directors 6 6

• Basic remuneration 8 061 6 101

• Bonus and performance-related payments 4 195 1 992

• Contributions to retirement and medical aid funds 60 59

• Other incentives and benefi ts 809 809

13 125 8 961

Less: Paid by subsidiary and non-subsidiary companies (13 125) (8 961)

– –

(Refer to the remuneration report on pages 46 to 48 for a further analysis of

aggregate remuneration and benefi ts paid to executive and non-executive directors.)

– 4 666 Amortisation of goodwill – –

18 – Amortisation of trademarks – –

– 4 388 Impairment of assets – –

1 773 – Net loss on disposal of property, plant and equipment – –

Depreciation –

2 963 3 162 • Land and buildings – –

95 335 84 610 • Plant, equipment and furniture 246 205

2 272 1 351 • Motor vehicles 17 15

1 502 839 • Leasehold improvements 54 60

102 072 89 962 317 280

2 510 3 298 Foreign exchange losses –

Operating lease charges

22 479 19 274 • Land and buildings 679 596

1 850 711 • Plant, equipment and motor vehicles 50 81

153 138 • Other – –

24 482 20 123 729 677

Staff costs

296 583 261 930 • Salaries and wages 14 481 12 610

17 285 16 918 • Pension and provident fund costs 1 164 866

10 516 9 287 • Other 244 212

3 195 2 991 Number of employees 13 12




R’000

Net profit

before

taxation Taxation

Minority

interests

Net

profit

18. EXCEPTIONAL ITEMS

The exceptional items consist of:

Group 2005:

Surplus on replacement of destroyed

plant and equipment from the insurance

claim relating to the fire that occurred

at Plastop (Proprietary) Limited,

Bronkhorstspruit on 1 August 2003 8 000 (208) – 7 792

Gain on disposal of empowerment

shareholding in PAK 2000 9 171 (1 271) – 7 900

Non-recurring costs incurred in respect

of the sinkhole at Cinqpet (Pty) Ltd’s

factory (4 388) – 219 (4 169)

12 783 (1 479) 219 11 523

Group Company

2006Restated

2005 R’000 2006Restated

2005

19. NET INVESTMENT INCOME/(FINANCE COSTS)

(33 881) (43 545) Interest paid (excluding debenture interest distribution) (10 509) (13 307)

(6 984) (5 883) Debenture interest distribution (7 927) (6 742)

3 665 2 416 Interest received 11 642 12 166

(37 200) (47 012) (6 794) (7 883)


77 Group Company

2006Restated

2005 R’000 2006Restated

2005

20. TAXATION

26 083 27 696 Current tax – Current year – –

– 1 839 – Capital gains tax – –

7 576 2 484 Deferred taxation (5 300) (2 100)

3 200 1 377 Secondary tax on companies 2 886 878

36 859 33 396 Total (2 414) (1 222)

%

Reconciliation of rate of taxation

29,0 30,0 South African normal tax rate on companies 29,0 30,0

– (0,1) • Change in tax rate – –

0,1 0,1 • Tax rate diff erence in respect of trusts – –

(2,2) (1,1) • Incentive allowances – –

3,8 7,7 • Disallowable expenses – –

(10,4) (12,5) • Non-taxable income (34,7) (34,8)

(2,0) (1,3) • Prior year losses utilised – –

– (1,2) • Capital gains tax – –

1,7 0,9 • Secondary tax on companies 3,1 2,0

20,0 22,5 Eff ective rate of taxation (2,6) (2,8)

R’000

Tax losses

201 385 139 788 Estimated tax losses available to off set future profi ts 101 452 63 460

59 945 40 229

Tax losses against which no deferred taxation asset was

raised 59 945 40 229




Group

2006Restated

2005 R’000

21. EARNINGS AND HEADLINE EARNINGS

PER LINKED UNIT (CENTS)

122,5 121,0 Earnings per linked unit (cents)

116,6 114,8 Net profit attributable to linked unitholders

5,9 6,2 Debenture interest

125,5 123,8

Prior to IFRS and other adjustments, earnings per linked

unit would have been reflected as

125,9 116,6 Headline earnings per linked unit (cents)

120,0 110,4 Net headline earnings attributable to linked unitholders


128,8 119,3

Prior to IFRS and other adjustments, earnings per linked

unit would have been reflected as

111,8 105,5 Earnings per linked unit – fully diluted (cents)

105,9 99,3 Attributable income


114,3 100,8 Headline earnings per linked unit – fully diluted (cents)

108,4 94,6 Attributable income


119 187 95 158 Weighted average number of linked units in issue (000)

131 272 110 018

Weighted average number of linked units in

issue – fully diluted (000)

Number of shares

119 187 95 158

Weighted average number of ordinary shares for the

purposes of basic earnings per share

12 085 14 860 Effect of dilutive potential ordinary shares – share options

131 272 110 018

Weighted average number of ordinary shares for the

purposes of diluted earnings per share

Reconciliation between attributable

profit and headline earnings

139 001 109 241 Net profit attributable to linked unitholders

6 984 5 883 Distribution to linked unitholders – debenture interest

Amortisation of goodwill relating to acquisitions

– 4 666 after 15 June 2000, before 31 March 2004

1 773 (5 380) Loss/(profit) on disposal of property, plant and equipment

– (9 171) Profit on disposal of 25% investment in PAK 2000

2 289 (41) Exercise of options

– 4 388 Sinkhole costs

(71) 1 437 Tax effect

(2) (127) Attributable to minorities

149 974 110 896 Headline earnings attributable to linked unitholders

Headline earnings per linked unit increased by 7,98% to 125,9 cents. The increase was attributable to increased volumes, improved

margins and greater efficiencies.


7922. DISTRIBUTION POLICY

The profi ts available for distribution by way of debenture interest and dividends (‘distributable profi ts’) will be covered approximately three times by after tax-earnings before debenture interest.

Debenture interest Debenture interest will be calculated at the lower of:

• the prime rate of interest of the face value of the debentures; and • the distributable profi ts.

Dividend policy The dividend policy will be to declare and pay the excess of the distributable profi ts, if any, over the debenture interest. The distribution policy will be reviewed by the Board of Directors of Astrapak from time to time, in light of prevailing circumstances and future cash requirements.

Group Company

2006Restated

2005 R’000 2006Restated

2005

23. CAPITAL COMMITMENTS

21 265 19 641 Authorised, contracted not spent – –

Capital commitment funding will be sourced from cash generated from operations or other fi nancing arrangements as required.

24. LEASE COMMITMENTS

Operating leases

18 775 12 919 • due within one year 118 624

76 238 51 667 • due thereafter – 287

95 013 64 586 Total 118 911

25. RETIREMENT BENEFITS

With eff ect from 1 March 1999, the Astrapak Provident and Astrapak Pension Funds were established for the purpose of consolidating the Group’s funds, by transferring all employees in the Group onto the Astrapak Provident and Pension Funds. All the funds are defi ned contribution funds as governed by the Pension Funds Act, 1956 (Act no 26 of 1956).

All eligible employees are members of either the Astrapak Provident and Pension Funds, or are members of funds within the various industries in which they are employed.

The assets of the funds, at 28 February 2005, are held in administered trust funds, separate from the Group’s assets, and are administered by various pension fund administrators.

The cost of retirement benefi ts charged to the income statement during the fi nancial period under review amounts to R17 284 897 (2005: R16 918 170).

26. CONTINGENT LIABILITIES

The Group has no material contingent liabilities. The Company has contingent liabilities in respect of guarantees issued to bankers and other creditors for normal business commitments of subsidiaries.




27. FINANCIAL RISK MANAGEMENT

The Group purchases financial instruments in order to finance its operations and to manage the interest rate and currency risks that

arise from normal business operations. In addition, financial balances, for example, trade debtors, trade creditors, bank balances,

accruals and prepayments arise from normal business operations within the Group.

The Group finances its operations mainly through retained profits, bank credit borrowings and long-term bank loans.

The Group also enters into derivative transactions, principally, forward currency contracts, forward rate agreements and interest rate

swaps in order to manage currency and interest rate risks that may arise.

The risk areas the Group is exposed to are credit risk, treasury risk, interest rate risk, liquidity risk and foreign currency risk. Compliance

with the Group’s policies is reviewed at Executive Committee meetings. These policies have remained unchanged throughout the

year ended 28 February 2006.

Treasury risk management

The Group’s treasury risk is managed through the Executive Committee reporting to the Board of Directors. One of the roles of this

committee is to decide the appropriate philosophy to be adopted within the Group regarding the management of treasury risks

and for considering and managing the Group’s existing financial market risks by adopting strategies within the guidelines set by the

Board.

Interest rate risk management

Interest rate risk is the possibility that the Group may suffer financial loss if either a fluctuating interest rate or fixed interest rate

position is entered into and interest rates move adversely. The Group uses swaps, options, forward rate arrangements and other

standard market instruments to manage this risk. The risk profile of financial liabilities and assets at balance sheet date is detailed

below, which excludes short-term receivables and non-interest bearing short-term payables:

R’000

Floating rate

assets

Fixed rate

liabilities

Floating rate

liabilities

Net

liability

South African Rand (144 456) 51 302 190 754 122 088

Total at 28 February 2006 (144 456) 51 302 190 754 122 088

South African Rand (98 224) 86 284 164 073 152 133

Total at 28 February 2005 (98 224) 86 284 164 073 152 133


81


27. FINANCIAL RISK MANAGEMENT (continued)

Liquidity risk management

Liquidity risk is the possibility that the Group may suff er fi nancial loss through liquid funds not being available or that excessive fi nance costs must be paid to obtain funds to meet payment requirements. The Group manages this risk through forecasting and monitoring cash fl ow requirements on a regular basis, and by maintaining suffi cient undrawn facilities. Signifi cant liquid resources were held at year-end. The Group had the following undrawn facilities available at the balance sheet date:

R’000 2006Restated

2005

Expiry period at 28 February

Within one year 139 614 149 380

Within two to fi ve years 90 005 250 017

229 619 399 397

The facilities expiring within one year are of a general banking nature and thus subject to review at various dates (usually on an annual basis), and it is expected that this profi le will continue.

The facilities expiring beyond two years are of a project and structured fi nance nature, and are utilised primarily to fi nance capital expenditure.

Foreign currency risk management Foreign currency risk is the risk that the Group may suff er fi nancial loss as a consequence of depreciation in a reporting currency relative to a foreign currency prior to payment of a commitment in that foreign currency, or of the reporting currency strengthening prior to receiving payment in that foreign currency.

The Group has transactional exposures in currencies other than South African Rands. These exposures arise from sales, or purchases, of inventory and capital expenditure.

The Group uses swaps, options and other fi nancial instruments, in particular forward contracts, to manage transactional currency risks. Specifi c translation risks are managed through the Group’s individual operating units. Speculative positions are not permitted.

All imports and exports are fully covered at balance sheet date. The values of forward contracts entered into at 28 February are:

R’000Average

contract rate 2006Restated

2005

US Dollars 6,28 5 324 21

Euro 11,1239 12 414 4 546

UK Pounds 7,588 829 3

18 567 4 570

Spot rate at 28 February

US Dollars 6,1659 5,8888

Euro 7,3134 7,8358

UK Pounds 10,7274 11,3865

Credit risk managementPotential concentrations of credit risk consist principally of cash investments and trade receivables. The Group only deposits cash surpluses with major banks of high standing.

Trade receivables comprise a large, widespread customer base. Ongoing credit evaluations on the fi nancial condition of customers are performed and, where appropriate, credit guarantee insurance cover is purchased or provisions made.

The Group does not consider there to be any signifi cant concentration of credit risk that had not been insured or adequately provided for at balance sheet date.

An allowance is made for impairment where there is an identifi ed loss event which, based on previous experience, is evidence of a reduction in the recoverability of the cash fl ows.

Fair value of fi nancial instruments The carrying amounts reported in the balance sheet for liquid resources, trade and other receivables and trade payables approximate fair value.



R’000 Films Rigids Flexibles Group

28. SEGMENTAL ANALYSIS

28.1 Business segment report (primary report)

Revenue – 2006 809 752 739 535 324 675 1 873 962

Revenue – 2005 774 623 608 853 266 751 1 650 227

Trading income – 2006 63 261 116 017 42 392 221 670

Trading income – 2005 64 752 91 842 26 100 182 694

Depreciation – 2006 22 669 67 196 12 207 102 072

Depreciation – 2005 28 986 48 817 12 159 89 962

Capital expenditure – 2006 67 026 100 550 16 287 183 863


Total assets – 2006 629 997 627 047 198 195 1 455 239

Total assets – 2005 464 449 481 906 166 173 1 112 528

Total liabilities – 2006 370 103 240 553 112 844 723 500


R’000 Gauteng

KwaZulu-

Natal Cape Group

28.2 Geographical report (secondary report)

Revenue – 2006 984 846 484 075 405 041 1 873 962

Revenue – 2005 949 814 421 185 279 228 1 650 227

Trading income – 2006 84 395 71 295 65 980 221 670

Trading income – 2005 103 922 56 529 22 243 182 694

Depreciation – 2006 62 052 17 095 22 925 102 072

Depreciation – 2005 58 690 18 152 13 120 89 962



Total assets – 2006 838 805 302 947 313 487 1 455 239

Total assets – 2005 736 578 225 435 150 515 1 112 528




83

Issuedshare

capitalR

Eff ectivepercentage holding

Amount owing by/(to) subsidiary

Cost of

investment

2006%

Restated2005

%2006

R’000

Restated2005R’000

2006R’000

Restated2005R’000

29. ANALYSIS OF INTEREST IN SUBSIDIARY

COMPANIES

Subsidiaries all incorporated in

the Republic of South Africa

29.1 Directly held

Astrapak Finance Company (Pty) Ltd (1) 100 100 100 69 233 56 424 53 000 53 000

Astrapak Gauteng (Pty) Ltd 100 100 100 (39 746) (131 244) – –

Astrapak KwaZulu-Natal (Pty) Ltd 100 100 100 (24 111) (52 337) – –

Astrapak Properties (Pty) Ltd (2) 100 100 100 1 727 2 047 – –

Astrapak Western Cape (Pty) Ltd 100 100 100 28 169 15 265 – –

International Edgeboard Technology (Pty) Ltd 100 100 100 471 871 – –

Master Plastics (Pty) Ltd 563 100 95 13 580 13 055 181 939 169 608

Astrapak Property Development (Pty) Ltd (2) 100 100 100 – – – –

Hilfort Plastics (Pty) Ltd 120 000 100 – 58 – 83 526 –

Indirectly held

Astra Repro (Pty) Ltd 100 80 80 230 (1 214) – –

Astrafl ex (Pty) Ltd 100 100 100 41 089 34 793 – –

Astrapak Exports (Pty) Ltd 100 100 100 (136) – – –

Barrier Film Converters (Pty) Ltd 1000 100 80 4 256 11 669 – –

Consupaq (Pty) Ltd 100 60 – – – – –

Diverse Labelling Consultants (Pty) Ltd 1 110 100 100 (51 500) (42 991) 14 282 14 282

Durpak (Pty) Ltd 1 000 100 100 6 754 (1 011) 1 003 1 003

Thermopac (Pty) Ltd 6 000 100 97,5 (15 218) (19 607) 17 900 14 941

Thermopackaging Natal (Pty) Ltd 100 100 100 – – – –

International Tube Technology (Pty) Ltd 1 000 000 60 60 3 195 3 669 600 600

JJ Precision Plastics (Pty) Ltd 200 100 100 (2 114) (2 898) 4 241 4 241

Pack-Line Holdings (Pty) Ltd 750 100 100 3 628 3 336 3 215 3 215

PAK 2000 (Pty) Ltd 4 000 75 75 (12 897) (17 379) 6 756 6 756

Safl ite Packaging (Pty) Ltd 200 75 75 (3 325) (2 250) 432 432

Tamperpak (Pty) Ltd 1 000 75 75 (3 427) (2 739) – –

Marcom Plastics (Pty) Ltd 100 50 50 (3 200) 1 143 4 518 4 518

Knilam Packaging (Pty) Ltd 100 70 70 (12 970) (815) 12 987 12 987

29.2 Subsidiaries in process of being deregistered

or liquidated

Directly held

Portion 727 Randjiesfontein (Pty) Ltd (3) 2 100 100 3 947 3 942 362 362

7 693 (128 271) 384 761 285 945

Subsidiaries are packaging companies, except for:(1) Finance company(2) Property company(3) Dormant company




29. ANALYSIS OF INTEREST IN SUBSIDIARY COMPANIES (continued)

29.3 Business combinations

During the financial year ended 28 February 2006, the following business combinations were undertaken:

Date of acquisition 1 March 2006 1 September 2006

% shareholding 100 60

Hilfort

R’000

Consupaq

R’000

Total

R’000

Fair value of assets acquired

Property, plant and equipment 49 298 12 353 61 651

Deferred taxation (9 656) (1 636) (11 292)

Dividends payable (247) – (247)

Other investments 21 – 21

Long-term liabilities (7 050) (4 612) (11 662)

Accounts receivable 18 589 4 877 23 466

Cash resources 16 398 7 003 23 401

Inventory 10 957 1 368 12 325

Accounts payable (9 615) (3 318) (12 933)

Taxation (2 619) (1 300) (3 919)

Short-term interest-bearing debt (7 004) (3 580) (10 584)

Minority shareholders (4 478) (4 478)

Trademarks – 45 45

59 073 6 721 65 794

Less: Cash and cash equivalents acquired (16 398) (7 003) (23 401)

Goodwill on acquisition 24 209 16 281 40 490

Net cash effect of purchase of subsidiaries 66 884 15 999 82 883

Profit after tax since the date of acquisition included in the Group’s

results for the financial year ended 28 February 2006 16 303 3 436 19 739

Should the above business combinations have been included for

the entire financial year ended 28 February 2006, the consolidated

results would have been reflected as:

Consolidated

Revenue 1 886 000

Profit after tax 150 727

No entities were disposed of as a result of these business combinations.

Goodwill on acquisition arose due to the present value of future profits (cost of the acquisition) exceeding the Group’s interest in

the fair value of the identifiable assets and liabilities of the subsidiary at the date of acquistion.

The transactions above were accounted for using the purchase method.


85


Interest paid to group

compa-nies

Interest paid by

group compa-

nies

Manage-ment

fees paid to group compa-

nies

Manage-ment fees

paid by group

compa-nies

Dividends paid by

group compa-

nies

Treasury assets of the

ultimate holding

company

Treasury liabilities

of the ultimate holding

company

Amounts owing

to Group compa-

nies

Amounts owing

by Group compa-

nies

30. RELATED PARTY TRANSACTIONS 2006 (R’000)Astra Repro (Pty) Ltd 89 324 1 392 31 Astrafl ex (Pty) Ltd 1 042 2 820 14 250 26 839 Astrapak Corporate Services (Pty) LtdAstrapak Exports (Pty) Ltd 2 880 136 Astrapak Finance Company (Pty) Ltd 650 20 17 126 7 215 Astrapak Gauteng (Pty) Ltd 6 329 6 492 79 779 2 715 18 685 1 341 Astrapak KwaZulu-Natal (Pty) Ltd 2 877 601 1 296 27 210 251 62 496 41 067 Astrapak Linked Unit Trust 41 124 Astrapak Properties (Pty) Ltd 360 1 727 Astrapak Property Development (Pty) Ltd 55 6 620 Astrapak Western Cape (Pty) Ltd 328 60 1 356 19 600 5 659 19 526 Barrier Film Converters (Pty) Ltd 125 142 120 4 245 11 Cinqcorp (Pty) LtdCinqpet (Pty) Ltd 1 284 844 Cinqplast Plastop (Pty) Ltd 37 414 6 298 37 4 531 Cinqprop (Pty) LtdConsupaq (Pty) LtdDiverse Labelling Consultants (Pty) Ltd 219 41 2 004 10 224 383 Durpak (Pty) Ltd 1 19 1 515 6 241 Euromatic Plastop (Pty) Ltd 4 120 6 004 46 Hilfort Plastics (Pty) Ltd 600 58 International Edgeboard Technology (Pty) Ltd 471 International Tube Technology (Pty) Ltd 37 336 3 783 Izakhamzi Plastics (Pty) LtdJJ Precision Plastics (Pty) Ltd 41 18 504 2 033 54 Knilam Packaging (Pty) Ltd 180 17 Marcom Plastics (Pty) Ltd 108 1 054 265 Master Plastics (Pty) Ltd 15 111 Pack-Line Holdings (Pty) Ltd 234 648 192 3 437 PAK 2000 (Pty) Ltd 74 128 1 020 3 068 110 Plastop KZN (Pty) Ltd 144 1 884 8 000 Plastop Leasing (Pty) LtdPlastop Properties (Pty) Ltd 589 420 6 200 Plastop Tools (Pty) LtdPortion 727 Randjiesfontein (Pty) Ltd 3 947 Safl ite Packaging (Pty) Ltd 120 23 Standard Labels (Mauritius)Tamperpak (Pty) Ltd 169 86 3 452 17 Thermopac (Pty) Ltd 200 56 1 873 212 178 Thermopackaging Natal (Pty) Ltd

4 814 10 017 2 880 30 165 61 921 114 387 109 317 18 821 176 106 The management fees charged by the ultimate holding company to Group companies represents an appropriate allocation of costs incurred by the ultimate holding company. All transactions are at arm’s length.Refer to the remuneration report and notes 17 and 33 for details of remuneration to key management personnel.



Interest paid to group

compa-nies

Interest paid by

group compa-

nies

Manage-ment fees

paid to group

compa-nies

Manage-ment fees

paid by group

compa-nies

Dividends paid by

group compa-

nies

Treasury assets of the

ultimate holding

company

Treasury liabilities

of the ultimate holding

company

Amounts owing

to Group compa-

nies

Amounts owing

by Group compa-

nies

30. RELATED PARTY TRANSACTIONS (continued) 2005 (R’000)Astra Repro (Pty) Ltd 55 263 1 263 57 Astraflex (Pty) Ltd 344 2 464 8 745 26 047 Astrapak Corporate Services (Pty) LtdAstrapak Exports (Pty) Ltd 2 094 Astrapak Finance Company (Pty) Ltd 3 372 390 1 015 5 034 Astrapak Gauteng (Pty) Ltd 7 836 2 009 5 711 30 804 55 822 1 437 Astrapak KwaZulu-Natal (Pty) Ltd 998 3 225 1 142 1 860 1 096 73 036 22 535 Astrapak Linked Unit Trust 46 059 Astrapak Properties (Pty) Ltd 390 2 047 Astrapak Property Development (Pty) Ltd 1 328 2 590 Astrapak Western Cape (Pty) Ltd 10 688 1 189 11 750 2 588 3 551 Barrier Film Converters (Pty) Ltd 886 120 9 383 285 Cinqcorp (Pty) LtdCinqpet (Pty) Ltd 447 1 447 Cinqplast Plastop (Pty) Ltd 32 5 327 5 032 6 576 Cinqprop (Pty) LtdConsupaq (Pty) LtdDiverse Labelling Consultants (Pty) Ltd 617 1 675 1 688 355 Durpak (Pty) Ltd 2 8 Hilfort Plastics (Pty) LtdInternational Edgeboard Technology (Pty) Ltd 871 International Tube Technology (Pty) Ltd 292 330 4 264 Izakhamzi Plastics (Pty) LtdJJ Precision Plastics (Pty) Ltd 22 101 529 1 249 55 Knilam Packaging (Pty) Ltd 3 Marcom Plastics (Pty) Ltd 44 999 84 Master Plastics (Pty) Ltd 19 000 Pack-Line Holdings (Pty) Ltd 230 800 2 713 624 PAK 2000 (Pty) Ltd 6 286 936 1 382 79 Plastop KZN (Pty) Ltd 658 Plastop Leasing (Pty) LtdPlastop Properties (Pty) LtdPlastop Tools (Pty) LtdPortion 727 Randjiesfontein (Pty) Ltd 3 947 Saflite Packaging (Pty) Ltd 114 60 Standard Labels (Mauritius)Tamperpak (Pty) Ltd 145 80 2 783 35 Thermopac (Pty) Ltd 22 276 1 941 4 622 191 Thermopackaging Natal (Pty) Ltd 12 053 10 776 2 094 24 506 32 610 60 021 88 385 58 412 125 640


87


31. EXPLANATION OF TRANSITION TO IFRS

31.1 As stated in the accounting policies, these are the Group’s fi rst consolidated fi nancial statements prepared in accordance with IFRS. The accounting policies set out in policy note 1 have been applied in preparing the fi nancial statements for the year ended 28 February 2006, the comparative information presented in these fi nancial statements for the year ended 28 February 2005 and in the preparation of an opening IFRS balance sheet at 1 March 2004, being the date of transition.

In preparing the Group’s opening IFRS balance sheet, the Group has adjusted amounts reported previously in fi nancial statements prepared in accordance with South African Generally Accepted Accounting Practice (GAAP). An explanation of how the transition from SA GAAP to IFRS has aff ected the Group’s fi nancial position, fi nancial performance and cash fl ows is set out in the tables and notes that accompany the tables.

31.2 Signifi cant changes to the Group’s accounting policies as a result of the change to IFRS

Goodwill

All business combinations are accounted for by applying the purchase method. Goodwill represents amounts arising on acquisitions of subsidiaries. In respect of business combinations that have occurred since the IFRS transition date, 1 March 2004, goodwill represents the diff erence between the cost of the acquisition and the fair value of the net identifi able assets and contingent liabilities acquired.

The Group elected in terms of IFRS 1, that IFRS 3 will only be applied from 1 March 2004. In respect of acquisitions prior to this date, goodwill is included as at 1 March 2004 at the amount previously reported under SA GAAP. The classifi cation and accounting treatment of business combinations that occurred prior to 1 March 2004 has not been reconsidered in preparing the Group’s opening IFRS balance sheet at 1 March 2004.

From 1 March 2004, goodwill is stated at cost less accumulated impairment losses. Goodwill is allocated to cash-generating units and is no longer amortised, but tested annually for impairment.

Previously, goodwill arising on each acquisition was amortised over its useful life, on a straight-line basis.

Share-based payment transactions

The fair value of share options granted to employees is recognised as an employee expense with a corresponding increase in equity (capital reserves). The fair value is measured at grant date and expended over the year during which the employee becomes unconditionally entitled to the equity instruments (the vesting period). The fair value of the instruments granted is measured using the Black Scholes valuation methodology, taking into account the terms and conditions upon which the instruments are granted. This accounting policy has been applied to all equity instruments granted after 7 November 2002 that had not yet vested by 1 March 2005. The fair value of share-based payments was not recognised under the Group’s previous accounting results.

31.3 Prior year restatement (SA GAAP adjustments)

Straight lining of operating lease payments

Payments due under operating leases are recognised in the income statement on a straight-line basis over the term of the lease.

Past practice, whereby operating lease payments were expended on a payments basis, was based on an interpretation that was generally used by entities in South Africa. This interpretation considered the contractual payments basis as being most representative of the time pattern of the entity’s benefi t obtained from the leased property. The global spotlight has led to the view that the entity is obliged to adopt the straight-line basis of accounting for all operating lease payments. The adjustment has been made as required by IAS 8 with the necessary restatement of comparative results.

Property, plant and equipment

The Group has restated the comparative information for the eff ects of adopting IAS 16 – Property, Plant and Equipment.

For the year under review the Group reviewed the useful life of all categories of property, plant and equipment that resulted in a reduction in the depreciation cost of R12 million. The change in accounting estimate is expected to benefi t the Group on an ongoing basis into the foreseeable future.

The useful life of the assets will be reviewed on a continual basis and adjustments will be made accordingly.



31. EXPLANATION OF TRANSITION TO IFRS (continued)

31.4 Balance sheet (summarised)

2005 balances

Notes

SA GAAP as previously

reportedR’000

Effect of transition to

IFRS(transition date 1 March 2004)

R’000

SA GAAP restatement

R’000

Restated 2005R’000

Retained income 1 410 049 (2 803) (1 808) 405 438

Capital reserves 2 – 2 803 – 2 803

Property, plant and equipment 3 477 241 – 3 730 480 971

Deferred taxation liability 4 49 142 – 686 49 828

Accounts payable 5 230 228 – 4 852 235 080

Notes:

1) The movement in retained income can be summarised as follows:

R’000

IFRS adjustment

Share based payment expense recognition 2 803

Prior year restatement (SA GAAP)

Depreciation reversal on assets previously written down to zero value (3 730)

Deferred taxation adjustment due to depreciation adjustment 686

Straight-lining of operating leases 4 852

Total 4 611

2) An adjustment of R2,8 million has been processed for share-based payments for instruments granted. Previously, the fair value of share-based payment transactions was not recognised in the financial statements.

3) An adjustment of R3,7million was processed to reinstate property, plant and equipment still in use, but previously written off to zero value.

4) The tax effects of the adjustment for depreciation on zero-valued property, plant and equipment have been reflected as an adjustment to deferred tax liabilities.

5) An adjustment of R4,9 million has been processed for rentals payable under operating leases in order to account for them on a straight-line basis over the term of the relevant lease.


89


31. EXPLANATION OF TRANSITION TO IFRS (continued)

31.5 Income statement – IFRS adjustments

2005 income statement

(R ‘000)

SA GAAP as previously

reported

Eff ect of transition to

IFRS(transition date 1 March 2004)

R’000SA GAAP

restatement IFRS restated

Revenue 1 650 227 1 650 227

Cost of sales (1 129 054 ) (85 464) (1 214 518 )

Gross profi t 521 173 (85 464) 435 709

Other operating income 17 441 17 441

Distribution and selling costs (127 216) (1 799) (129 015)

Administrative and other operating expenses (229 687) (1 723) 86 350 (145 060)

Share of results of associate and joint venture 3 619 3 619

Trading income 185 330 (1 723) (913) 182 694

Exceptional item 12 783 12 783

Profi t from operations 198 113 (1 723) (913) 195 447

Investment income 2 416 2 416

Finance costs (49 428) (49 428)

Profi t before taxation 151 101 (1 723) (913) 149 378

Taxation (33 396) (33 396)

Profi t for the year 117 705 (1 723) (913) 115 069

Attributable to:

Linked unit holders of the parent 111 877 (1 723) (913) 109 241

Minority interest 5 828 5 828

Profi t for the year 117 705 (1 723) (913) 115 069

An explanation of the adjustments made to comply with IFRS and prior year restatements are included in the balance sheet explanation table – refer to note 31.4.Depreciation to the value of R87 263 has been reallocated from administrative and other operating expenses to cost of sales (R85 464) and distribution and selling costs (R1 799). The current year results refl ect depreciation under the same classifi cations.In addition, the share of results of associate and joint venture which was previously refl ected after profi t after taxation, is now included at a trading income level.

31.5 Cash fl ow statement

The IFRS adjustments and prior year restatements (SA GAAP) refl ected in the above notes do not impact on cash and cash equivalents. Consequently the only adjustments that would have been made to the cash fl ow statement are to reported profi ts and a like adjustment to non-cash items.

32. Comparative fi gures

Comparative fi gures have been reclassifi ed to comply with the requirements of IFRS. Details of these changes have been provided in note 31 – Explanation of transition to IFRS.



33. LINKED UNIT BASED PAYMENTS

Equity-settled linked unit option plan

The Group plan provides for a grant price equal to the average price at which the relevant linked unit traded on the JSE on the 3 (three) trading days immediately preceding the offer date. The vesting period is generally three to four years. If the option remains unexercised after a period of eight years from the date of grant, the option expires. Furthermore, options are forfeited if the employee leaves the Group before the options vest.

2006 2005

Number of

options

Weighted

average price

per linked unit

(in Rand)

Number of

options

Weighted

average price

per linked unit

(in Rand)

Outstanding at the beginning of the period 13 837 000 3,40 13 555 500 2,78

Granted during the period 430 000 13,67 1 421 000 8,95

Forfeited or cancelled during the period 448 707 3,58 190 000 5,39

Exercised during the period 2 862 251 2,66 949 500 2,40

Expired during the period – – – –

Outstanding at the end of the period 10 956 042 3,99 13 837 000 3,40

Exercisable at the end of the period 1 986 499 2,54 954 667 2,40

The weighted average price at the date of exercise for linked unit options exercised during the period was R11,92. The options

outstanding as at 28 February 2006 had a weighted average exercise price of R3,99 and a weighted average remaining contractual

life of 2,85 years (2005: 3,74 years).

The inputs into the Black-Scholes model for the various option issues are as follows:

Option issue date

28 Feb 06 20 Jul 05 08 Nov 04 14 Jul 03 05 May 03

Number of options 330 000 100 000 1 361 000 500 000 3 010 000

Weighted average linked unit price at date of issue 14,40 11,28 8,95 4,10 3,75

Weighted average exercise or issue price of option 14,40 11,28 8,95 4,10 3,75

Expected volatility expressed as % 34,60% 36,90% 42,70% 41,87% 42,70%

Time to expiry / Expected life in years 8 8 8 8 8

Risk-free rate of return 7,20% 7,60% 8,30% 9,30% 9,50%

Forward dividend yield 3,30% 3,30% 3,30% 3,30% 3,30%

Value per option in Rand 5,34 4,80 3,86 2,11 1,66

Expected volatility was determined by calculating the historical volatility of the Group’s share price over the previous three years.

This was then annualised on the assumption of 252 trading days. The risk-free rate used was that of the R153 government bond yield.

The option does not entitle its holder to distributions, and a 3,3% yield was used based on the assumptions that the Group dividend

policy will be to distribute one-third of earnings and that the linked unit will trade on an earnings yield of 10%.

The Group recognised total expenses of R2 529 795 and R1 723 454 related to equity-settled linked unit-based payment transactions

in 2006 and 2005 respectively.


91

Annexure 1 – details of land and buildingsat 28 February 2006

Owner Description of premises Erf

2006

Cost

R’000

2005

Cost

R’000

Astrapak Properties (Pty) Ltd Factory and offi ces utilised by

Thermopac

Erf 22380, Goodwood

Cape Province 3 745 3 745

Astrapak Gauteng (Pty) Ltd Factory and offi ces utilised by

East Rand Plastics

Stand 95

Vulcania, Brakpan 139 139


East Rand Plastics

Portion 40 of the farm

Koobult 121 IR 6 572 6 572


Peninsula Packaging

Stand 29158

Bellville 5 538 5 538


East Rand Plastics

Stand 87

Vulcania, Brakpan 3 950 3 779

Astrapak Gauteng (Pty) Ltd Vacant stand Erf 45, Aeroton

Gauteng Province 506 506

Astrapak KwaZulu-Natal (Pty) Ltd Factory and offi ces utilised by

Diverse Labelling Consultants

Astrapak Exports and Astra Repro

Sub 1 of lot 2823

Pinetown

10 851 9 892

Cinqprop (Pty) Ltd Factory and offi ces utilised by

Cinqplast Plastop

Erf 594, Denver

Gauteng Province 19 704 19 704

Plastop (Pty) Ltd Factory and offi ces utilised by

Cinqplast Plastop

Stands 84 and 960

Bronkhorstspruit

Gauteng Province 54 54

Plastop Properties (Pty) Ltd Factory and offi ces utilised by

Plastop

Lot 2354 Amanzimtoti

Port Natal KwaZulu-Natal 6 664 6 664

Cinqcorp (Pty) Ltd Factory and offi ces utilised by

Cinqplast Plastop

Erf 756, 757 and 758

Denver, Extension 12

Gauteng Province 11 992 11 992

69 715 68 585


Linked unitholders’ information at 28 February 2006

LINKED UNITHOLDERS’ DIARY

February Financial year-end September Annual General Meeting

May Preliminary results announcement for the year

ended 28 February 2006

October Interim results announcement

for the period ending 31 August 2006

August Annual report published

ANALYSIS OF LINKED UNITHOLDERS Linked unitholders’ spread as at 28 February 2006

Linked unitholders in SA Linked unitholders outside SA Total linked unitholders

Number

of holders

Linked

units held

% of

issued

Number

of holders

Linked

units held

% of

issued

Number

of holders

Linked

units held

% of

issued

Public 1 704 115 024 740 85,1 11 2 208 464 1,6 1 715 117 233 204 86,6

Non-public 13 17 898 046 13,2 – – – 13 17 898 046 13,2

• Directors of the Company

and its subsidiaries 11 1 998 908 1,5 – – – 11 1 998 908 1,5

• Trustees of the Astrapak

Limited Linked Unit Trust

Scheme 1 12 085 006 8,9 – – – 1 12 085 006 8,9

• Tristar Plastics (a division of

Astrapak Gauteng (Pty) Ltd) 1 3 814 132 2,8 – – – 1 3 814 132 2,8

1 717 132 922 786 98,4 11 2 208 464 1,6 1 728 135 131 250 100,0

MAJOR LINKED UNITHOLDERS as at 28 February 2006

Linked units

held

%

issued

Rand Merchant Bank Asset Managers 44 668 386 33,1

Royal Bafokeng Finance 27 026 250 20,0

Astrapak Limited Linked Unit Trust Scheme 12 085 006 8,9

Sanlam Investment Management 7 339 243 5,4

Prudential M&G 5 848 660 4,3

Old Mutual Asset Managers 5 449 690 4,0

Stanlib Asset Management 4 865 183 3,6


93

Linked unitholders’ information (continued)at 28 February 2006

DIRECTORS’ INTEREST as at 28 February 2006

Director

Benefi cial

Direct

Non-benefi cial

Indirect

Unitholding

(%)

R Crewe-Brown 222 790 595 648 0,6

M Baglione 10 000 56 700 0,0

PC Botha* – 10 000 0,0

RT Dalais – 268 744 0,2

M Diedloff 5 230 – 0,0

G Petzer 340 667 – 0,3

WJ Venter 230 780 – 0,2

809 467 931 092 1,3

* Mr PC Botha was a trustee of the Astrapak Limited Linked Unit Trust Scheme, the holder of 12 085 006 linked units until 17 January 2006

when AM Chait was appointed in his place.

DIRECTORS’ INTEREST as at 28 February 2005

Director

Benefi cial

Direct

Non-benefi cial

Indirect

Unitholding

(%)

R Crewe-Brown 210 460 595 648 0,7

M Baglione 153 100 56 700 0,2

PC Botha* – 14 337 000 11,9

RT Dalais – 140 000 0,1

M Diedloff 89 000 – 0,1

G Petzer 126 000 – 0,1

WJ Venter 190 780 – 0,2

RA Upton 53 333 – 0,1

822 673 15 129 348 13,4


Linked unitholders’ information – notice of meetingat 28 February 2006

Notice is hereby given that the Annual General Meeting of

the linked unitholders of the Company will be held at the

Inanda Club, 1 Forest Road, Inanda, Sandton on Thursday,

28 September 2006 at 09:00 for the following purposes:

Ordinary business ¬

1. Ordinary resolution number 1

To receive, consider and approve the annual financial

statements of the Company and the Group together with

the reports of the directors and auditors for the year ended

28 February 2006.


To elect a director in the place of Mr C Molefe who retires

in terms of the Company’s Articles of Association and who,

being eligible, offers himself for re-election. A brief CV

appears on page 13 of this report.


To elect a director in the place of Mr T Kgage who retires





To elect a director in the place of Mr G Petzer who retires





To confirm the re-appointment of Deloitte & Touche as

auditors for the ensuing year and to authorise the directors

to approve their remuneration.


To approve the directors’ remuneration for the year ended

28 February 2006.


To place 10% of the authorised but unissued linked units

of the Company under the control of the directors as a

general authority contemplated in terms of section 221 of

the Companies Act (Act 61 of 1973) as amended (‘the Act’),

and to grant the directors the authority to allot and issue

these shares on such terms and conditions as the directors

may determine and subject to the provisions of the Act,

the Articles of Association of the Company and the Listings

Requirements of JSE Limited.


To authorise the directors by way of a general approval to

issue authorised but unissued linked units for cash as they

may deem fit, subject to the Act, the Articles of Association

of the Company and the Listings Requirements of JSE

Limited subject to the following limitations:

• that at least 75% of the shareholders present in person

or by proxy at the Annual General Meeting cast their

vote in favour of this resolution;

• that this general authority shall not extend beyond

15 months from the date of this Annual General Meeting

or the date of the next Annual General Meeting,

whichever is the earlier;

• the securities will be issued only to public shareholders

as defined in the Listings Requirements of the JSE

Limited and not to related parties;

• any such issue will only be securities of a class already in

issue;

• that issues in the aggregate in any financial year will not

exceed 15% of the Company’s issued linked unit capital

as at the date of the first such issue. The securities of a

particular class will be aggregated with the securities

that are compulsorily convertible into securities of

that class; and, in the case of the issue of compulsorily

convertible securities, aggregated with the securities of

that class into which they are compulsorily convertible.

The number of securities of a class which may be issued

shall be based on the number of securities of that class

in issue at the date of such application less any securities

of the class issued during the current financial year,

provided that any securities of that class to be issued


95pursuant to a rights issue (announced and irrevocable

and underwritten) or acquisition (concluded up to the

date of application) may be included as though they

were securities in issue at the date of application; and

• that in determining the price at which the issue of linked

units will be made in terms of this authority, the maximum

discount permitted will be 10% of the weighted average

traded price as determined over 30 business days prior

to the date that the price of the issue is determined or

agreed by the Company’s directors.

The JSE Limited should be consulted for a ruling if the

Company’s securities have not traded in such

30 business day period.

The Company will publish a press announcement, at the time

of any issue representing on a cumulative basis, within one

year, 5% or more of the number of linked units which it had in

issue prior to such issue containing full details of such issue,

including the impact of the issue on net asset value and

earnings per share.

Shares held by the share trust or scheme will not have their

votes taken account of for the above Ordinary resolution

number 8.

General authority to acquire linked units ¬

Special resolution 1

Linked unitholders are requested to consider and, if deemed

fi t, pass with or without modifi cation, the following special

resolution:

Resolved that the Company’s directors be hereby authorised,

by way of a general authority, to repurchase linked units in

the Company and permit any subsidiary of the Company to

purchase linked units in the Company, as and when deemed

appropriate, subject to the Act, the Articles of Association of

the Company and the Listings Requirements of JSE Limited

and the following limitations, namely that:

• any such acquisition of linked units shall be eff ected

through the order book operated by JSE Limited’s trading

system and done without any prior understanding or

arrangement between the Company and the counter

party;

• that this general authority shall not extend beyond

15 months from the date of this Annual General Meeting

or the date of the next Annual General Meeting, whichever

is the earlier;

• a press announcement will be published as soon as the

Company has acquired linked units constituting, on a

cumulative basis, 3% of the number of the linked units in

issue as at the time the authority was granted;

• acquisitions of linked units in the aggregate in any one

fi nancial year may not exceed 20% of the Company’s

issued ordinary share capital and debentures (‘linked units’)

as at the beginning of the fi nancial year;

• in determining the price at which linked units issued by

the Company will be acquired, the maximum premium at

which such linked units may be acquired will be 10% of

the weighted average of the market value at which such

linked units are traded on the JSE, as determined over the

fi ve business days immediately preceding the date of such

acquisition;

• the sponsor to the Company provides a letter on the

adequacy of working capital in terms of section 2.12 of JSE

Limited’s Listings Requirements prior to any repurchases

being implemented on the open market of the JSE; and

• to the extent it is needed, the consent of the debt

providers to the Company and the Group has been

obtained prior to any repurchases being implemented on

the open market of the JSE.

• after such repurchase the Company will still comply

with JSE Limited’s Listings Requirements concerning

shareholder spread requirements;

• the Company or its subsidiary is not repurchasing securities

during a prohibited period as defi ned in JSE Limited’s

Listings Requirements;

• and the Company only appoints one agent to eff ect any

repurchase(s) on its behalf.


Linked unitholders’ information – notice of meeting (continued)at 28 February 2006

The directors undertake that the Company shall not make

any payment to acquire any linked units issued by the

Company if there are reasonable grounds for believing that

for a period of 12 months after the date of the notice of the

annual general meeting:

• the Company and the Group will after payment be unable

to pay its debts as they become due in the ordinary course

of business;

• the assets of the Company and the Group, fairly valued in

terms of International Financial Reporting Standards and

on a basis consistent with the last financial year of the

Company, will after the payment be less than the liabilities

of the Company and the Group;

• the ordinary capital and reserves of the Company and the

Group will be inadequate for the purposes of the business

of the Company and the Group; and

• the working capital available to the Company and the

Group will be inadequate for the purposes of the business

of the Company and the Group.

The Board has no immediate intention to use this authority to

repurchase linked units. However, the Board is of the opinion

that this authority should be in place should it become

appropriate to undertake a linked unit repurchase in the

future.

Reason and effect for special resolution number 1

The Board believes it to be in the best interests of the

Company that linked unitholders pass a special resolution

granting the Company a general authority for the acquisition

by the Company of its own linked units or to permit any

subsidiary of the Company to purchase linked units in the

Company should such acquisition be in the interests of the

Company. Such general authority will provide the directors

with the flexibility, subject to the requirements of the Act and

the Listings Requirements of JSE Limited, to repurchase linked

units should it be in the best interests of the Company at any

time while the general authority subsists.

General disclosure

The JSE Listings Requirements require the following

disclosures, some of which are elsewhere in the annual report

of which this notice forms part, as set out below:

Directors and management – pages 12 and 13;

Major shareholders of the Company – page 92;

Directors’ interests in securities – page 93; and

Share capital of the company – page 71.

Litigation statement

In terms of section 11.26 of the Listings Requirements of the

JSE, the directors, whose names are given on page 12 and

13 of the annual report of which this notice forms part, are

not aware of any legal or arbitration proceedings, including

proceedings that are pending or threatened, that may have

or have had in the recent past, being at least the previous

12 months, a material effect on the Group’s financial position.

Directors’ responsibility statement

The directors, whose names are given on pages 12 and 13

of the annual report, collectively and individually accept

full responsibility for the accuracy of the information

pertaining to this resolution and certify that, to the best

of their knowledge and belief, there are no facts that have

been omitted which would make any statement false or

misleading, and that all reasonable enquiries to ascertain

such facts have been made and that this resolution contains

all information required by law and the Listings Requirements

of JSE Limited.

Material change

Other than the facts and developments reported on in

this 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 the date of this notice.

Shares held by the share trust or scheme will not have their

votes taken account of for the above Special resolution

number 1.


97

Linked unitholders’ information – notice of meeting (continued)at 28 February 2006

Voting and proxies

Members who have not dematerialised their linked units or

who have dematerialised their linked units with ‘own name’

registration are entitled to attend and vote at the meeting

and are entitled to appoint a proxy or proxies to attend, speak

and vote in their stead. The person so appointed need not be

a member.

A form of proxy setting out the relevant instructions for its

completion is enclosed for use by a linked unitholder who

wishes to be represented at the general meeting. Completion

of a form of proxy will not preclude such linked unitholder

from attending and voting (in preference to that linked

unitholder’s proxy) at the Annual General Meeting. Proxy

forms must be forwarded to reach the registered offi ce of

the Company’s transfer secretaries, Computershare Investor

Services 2004 (Pty) Limited, 70 Marshall Street, Johannesburg,

2001 or posted to the transfer secretaries at PO Box 61051,

Marshalltown, 2107, South Africa so as to be received by

them by not later than 09:00 on Wednesday,

27 September 2006.

On a show of hands, every member of the Company present

in person or represented by proxy shall have one vote only.

On a poll, every member of the Company shall have one vote

for every linked unit held in the Company by such member.

Members who have dematerialised their linked units, other

than those members who have dematerialised their linked

units with ‘own name’ registration, should contact their

CSDP or broker in the manner and time stipulated in their

agreement:

• to furnish them with their voting instructions; and

• in the event that they wish to attend the meeting, to

obtain the necessary authority to do so.

Y Cowley G King

Company Secretary Company Secretary

Sandton Sandton

14 July 2006 30 August 2006


Administration

BUSINESS ADDRESS AND REGISTERED OFFICE

1st Floor, Wierda Court, Johan Avenue, Wierda Valley, Sandton

POSTAL ADDRESS

PO Box 652740, Benmore 2010

TRANSFER SECRETARIES

Computershare Investor Services 2004 (Pty) Limited

70 Marshall Street, Johannesburg

PO Box 61051

Marshalltown 2107

AUDITORS

Deloitte & Touche

Buildings 1 and 2

Deloitte Place

The Woodlands

Woodlands Drive

Woodmead, Sandton

PRINCIPAL BANKERS

ABSA Bank Ltd, ABSA Towers North

180 Commissioner Street

Johannesburg

Citi Bank N.A. South Africa, 145 West Street, Sandown

SPONSOR

Rand Merchant Bank (A division of FirstRand Bank Limited)

1 Merchant Place

Cnr Fredman Drive and Rivonia Road

Sandton

CORPORATE LAW ADVISERS

Paul Botha and Associates (Pty) Ltd

39 Rivonia Road, Sandhurst

COMPANY REGISTRATION NUMBER

1995/009169/06

WEBSITE ADDRESS

www.astrapak.co.za


99

Form of proxy – linked unitholdersfor the year ended 28 February 2006

This form is only to be completed by certifi cated and ‘own name’ registered dematerialised linked unitholders.

Astrapak LimitedRegistration number 1995/009169/06

Incorporated in the Republic of South AfricaShare code: APK ISIN: ZAE000030938

(‘the Company’)

A linked unitholder entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy, or proxies, to attend, speak and

vote thereat in his/her stead. A proxy need not also be a linked unitholder of the Company. All forms of proxy must be lodged with the transfer

secretaries, Computershare Investor Services 2004 (Pty) Limited, by not later than 09:00 on Wednesday, 27 September 2006.

Linked unitholders, other than own name registered dematerialised linked unitholders, that have dematerialised their linked units with a

Central Securities Depository Participant (‘CSDP’) or broker, must arrange with the CSDP or broker concerned to provide them with the necessary

authorisations to attend the Annual General Meeting. Alternatively the linked unitholders concerned must instruct them as to how they wish to vote in this

regard. This must be done in terms of the agreement entered into between the linked unitholders concerned and the CSDP or broker concerned.

I/We (name)

of (address)

being a member(s) of the abovenamed company, hereby appoint:

or failing him/her,

the chairman of the Annual General Meeting,

as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held at 09:00 on Thursday, 28 September 2006.

Signed at this day of 2006

Signature

Please indicate in the space below how you wish your votes to be cast by inserting the number of linked units in the appropriate space. If you return this

form duly signed, without any specifi c instructions, the proxy shall be entitled to vote as he/she thinks fi t.

In favour of Against

Abstain

from voting

1. Ordinary resolution number 1 – To receive, consider and approve annual fi nancial statements

2. Ordinary resolution number 2 – Re-election of Mr C Molefe

3. Ordinary resolution number 3 – Re-election of Mr T Kgage

4. Ordinary resolution number 4 – Re-election of Mr G Petzer

5. Ordinary resolution number 5 – Re-appointment of Deloitte & Touche as auditors

6. Ordinary resolution number 6 – Approval of directors’ remuneration

7. Ordinary resolution number 7 – Control of authorised but unissued shares

8. Ordinary resolution number 8 – General issue of linked units for cash

9. Special resolution number 1 – General authority to acquire linked units

Please read the notes on the reverse side hereof.


Notes to proxy

1. A linked unitholder may insert the names of one or

more proxies (who need not be linked unitholders of the

Company) in the space provided, with or without deleting

the words ‘the chairman of the Annual General Meeting’.

The person whose name appears first on the form of proxy

and has not been deleted will be entitled to act in priority

to those whose names follow. In the event that no names

are filled in, the proxy shall be exercised by the chairman of

the Annual General Meeting.

2. A linked unitholder’s instructions to the proxy must be

indicated by the insertion of the relevant number of votes

in the space provided. Failure to comply with the above will

be deemed to authorise the proxy to vote as he/she thinks

fit. However, where the proxy is the chairman, such failure

shall be deemed to authorise the chairman to vote in favour

of the resolutions. A linked unitholder or his/her proxy is

not obliged to use all the votes exercisable by the linked

unitholder or his/her proxy.

3. The completion and lodging of this form of proxy shall

in no way preclude the linked unitholder from attending,

speaking and voting in person at the Annual General

Meeting to the exclusion of any proxy appointed in terms

hereof.

4. Should this form of proxy not be completed and/or

received in accordance with these notes, the chairman may

accept or reject it, provided that in respect of its acceptance

the chairman is satisfied as to the manner in which the

linked unitholder wishes to vote.

5. This form of proxy shall be valid for any adjournment of

the Annual General Meeting as well as the Annual General

Meeting to which it relates, unless the contrary is stated

hereon.

6. Where this form of proxy is signed under power of attorney,

such power of attorney must accompany this form of proxy

unless it has been previously been registered with the

Company.

7. Where linked units are held jointly, all joint linked

unitholders are required to sign.

8. This form of proxy must be returned to the transfer

secretaries of the Company, Computershare Investor

Services 2004 (Pty) Limited, 70 Marshall Street,

Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107),

to be received by not later than 09:00 on Wednesday,

27 September 2006.

9. Linked unitholders that have dematerialised their linked

units with a CSDP or broker must arrange with the CSDP

or broker concerned to provide them with the necessary

authorisations to attend the Annual General Meeting or

the linked unitholders concerned must instruct them as to

how they wish to vote in this regard. This must be done in

terms of the agreement entered into between the linked

unitholders concerned and the CSDP or broker concerned.

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