24 April 2013

Audited Consolidated Financial results for year ended 28 February 2013

Allied Technologies Limited
(Incorporated in the Republic of South Africa)
Registration number: 1946/020415/06
Share code: ALT
ISIN: ZAE000015251

Highlights
- Revenue 4,7% to R10,4 billion
- HEPS 23% to 268 cents
- Earnings from continuing operations 73% to R360 million
- NAV per share to 849 cents
- No dividend declared, to conserve cash resources
Consolidated statement of comprehensive income

2013 2012
Figures in R million (Audited) (Audited)

CONTINUING OPERATIONS
Revenue 10 161 9 576
Earnings before interest, tax, depreciation, amortisation and capital items
(EBITDA before capital items) 878 892
Depreciation and amortisation (165) (176)
Operating profit before capital items 713 716
Capital items (Note 1) (87) (240)
Results from operating activities 626 476
Finance income 13 15
Finance expenses (57) (43)
Profit before taxation 582 448
Taxation (225) (207)
STC - (35)
Profit for the year from continuing operations 357 206
DISCONTINUED OPERATIONS
Revenue 280 396
Earnings before interest, tax, depreciation, amortisation and capital items
(EBITDA before capital items) (113) 27
Depreciation and amortisation (52) (94)
Operating loss before capital items (165) (67)
Capital items (Note 1) (1 371) (590)
Results from operating activities (1 536) (657)
Finance income 2 -
Finance expenses (92) (31)
Loss before taxation (1 626) (688)
Taxation (10) (20)
Loss for the year from discontinued operations (1 636) (708)
Loss for the year (1 279) (502)
Other comprehensive income
Foreign currency translation differences in respect of foreign operations 243 67
Realisation of negative foreign currency translation reserve on disposal 196 -
Other comprehensive income for the year 439 67
Total comprehensive income for the year (840) (435)
Loss attributable to:
Non-controlling interests (342) (226)
Altech equity holders (937) (276)

Altech equity holders from continuing operations 360 208
Altech equity holders from discontinued operations (1 297) (484)

Loss for the year (1 279) (502)
Total comprehensive income attributable to:
Non-controlling interests (301) (208)
Altech equity holders (539) (227)

Altech equity holders from continuing operations 502 229
Altech equity holders from discontinued operations (1 041) (456)
Total comprehensive income for the year (840) (435)
Basic earnings per share from continuing operations (cents) 369 213
Diluted basic earnings per share from continuing operations (cents) 353 207
Basic loss per share from total operations (cents) (961) (283)
Diluted basic loss per share from total operations (cents) (920) (275)
Basic loss per share from discontinued operations (cents) (1 330) (497)
Diluted basic loss per share from discontinued operations (cents) (1 273) (482)

Consolidated statement of financial position
2013 2012
Figures in R million (Audited) (Audited)
ASSETS
Non-current assets 1 666 1 732

Property, plant and equipment 305 886
Intangible assets and goodwill 429 693
Investments 497 -
Non-current receivables and other assets 414 96
Loans receivable - 18
Deferred taxation 21 39

Current assets 2 098 2 357
Inventories 377 449
Trade and other receivables 1 372 1 497
Cash and cash equivalents 349 276
Assets classified as held-for-sale - 135
Total assets 3 764 4 089

EQUITY AND LIABILITIES
Total equity 597 1 433
Altech equity holders 828 1 600
Non-controlling interests (231) (167)

Non-current liabilities 449 570
Loans payable 366 473
Deferred income - 51
Deferred taxation 83 46
Current liabilities 2 718 2 086
Trade and other payables 2 378 1 649
Warranty provisions 29 22
Bank overdrafts 279 292
Taxation payable 32 56
Liabilities classified as held-for-sale - 67
Total equity and liabilities 3 764 4 089
Net asset value per share (cents) 849 1 641

Consolidated statement of changes in equity

Attributable to Altech equity holders
Premium/
discount
on non-
controlling
Share equity Non-
capital and Treasury Other trans- Retained controlling Total
Figures in R million premium shares reserves actions earnings Total interests equity
Balance at 1 March 2011 49 (292) (384) 259 2 505 2 137 92 2 229
Total comprehensive income
Loss for the year (276) (276) (226) (502)
Other comprehensive income
Foreign currency translation differences in respect
of foreign operations - - 49 - - 49 18 67
Total other comprehensive income - - 49 - - 49 18 67
Total comprehensive income for the year - - 49 - (276) (227) (208) (435)
Transactions with owners, recorded
directly in equity
Contributions by and distributions to owners
Issue of share capital 1 1 1
Dividends to equity holders (347) (347) (12) (359)
IFRS 2 charge on B-BBEE transactions - - 5 - - 5 - 5
Share-based payment transactions - - 11 - - 11 - 11
Total contributions by and distributions to owners 1 - 16 - (347) (330) (12) (342)
Changes in ownership interests in subsidiaries
Buy-back of non-controlling interest 20 20 (39) (19)
Total changes in ownership interests in subsidiaries - - - 20 - 20 (39) (19)
Total transactions with owners 1 - 16 20 (347) (310) (51) (361)
Balance at 29 February 2012 50 (292) (319) 279 1 882 1 600 (167) 1 433
Total comprehensive income
Loss for the year (937) (937) (342) (1 279)
Other comprehensive income
Foreign currency translation differences in respect
of foreign operations - - 202 - - 202 41 243
Realisation of negative foreign currency translation
reserve on disposal 196 - - 196 - 196
Total other comprehensive income - - 398 - - 398 41 439
Total comprehensive income for the year - - 398 - (937) (539) (301) (840)
Transactions with owners, recorded
directly in equity
Contributions by and distributions to owners
Issue of share capital 4 4 4
Dividends to equity holders (242) (242) (5) (247)
Share-based payment transactions - - 5 - - 5 - 5
Total contributions by and distributions to owners 4 - 5 - (242) (233) (5) (238)
Changes in ownership interests in subsidiaries
Disposal operations - 242 242
Total changes in ownership interests in subsidiaries - - - - - - 242 242
Total transactions with owners 4 - 5 - (242) (233) 237 4
Balance at 28 February 2013 54 (292) 84 279 703 828 (231) 597

Consolidated statement of cash flows

2013 2012
Figures in R million (Audited) (Audited)

CONTINUING OPERATIONS
Cash flows generated/(utilised) by operating activities 990 (68)

Cash generated by operations before movements in working capital 1 058 956
Movements in working capital 381 (321)
Net finance expenses (26) (28)
Taxation paid (176) (316)
Cash generated by operating activities 1 237 291
Dividends paid
- Altech equity holders (242) (347)
- Non-controlling interests (5) (12)
Cash flows utilised in investing activities (751) (226)
Cash flows from/(used in) financing activities 554 (154)
DISCONTINUED OPERATIONS
Cash flows utilised by operating activities (90) (160)
Cash flows utilised in investing activities (22) (225)
Cash flows (used in)/from financing activities (146) 363
Cash flows on disposal of discontinued operations (353) -
(611) (22)
Increase/(decrease) in net cash and cash equivalents 182 (470)
Bank overdraft on acquisition of subsidiaries - (16)
Net cash in subsidiaries sold (96) -
Cash and cash equivalents at the beginning of the year (16) 458
Bank overdraft at the end of the year classified as held-for-sale - 12
Cash and cash equivalents at the end of the year 70 (16)
Continuing operations 70 (12)
Discontinued operations - (4)
Note:
For the year ended 29 February 2012, R137 million was reclassified from Cash flows utilised by operating activities (movements in working capital) to Cash flows
utilised in investing activities. This represents investments made during the prior financial year by operating entities in respect of additions to contract
fulfilment costs. Management believes that this better represents the nature of the cash flows being of an investment rather than an operating nature.
Notes
BASIS OF PREPARATION
The summarised consolidated financial statements are prepared in accordance with the framework concepts and the measurement and recognition requirements of
International Financial Reporting Standards (IFRS), the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, and also, as a minimum,
to contain the information required by IAS 34: Interim Financial Reporting and the requirements of the Companies Act of South Africa and the JSE Listings Requirements.

The accounting policies applied in the preparation of the audited consolidated financial statements, from which the summarised consolidated financial statements were
derived, are in terms of International Financial Reporting Standards and are consistent with the accounting policies applied in the preparation of the previous
audited consolidated financial statements.

This report was compiled under supervision of Dr John Carstens CA(SA), chief financial officer, and Mr Francois Verster CA(SA), group financial manager.
Auditor's report
KPMG Inc.'s unmodified auditor's report on the summarised consolidated financial statements is available for inspection at the company's registered office.
Change 2013 2012
Figures in R million % (Audited) (Audited)
Headline earnings per share (cents) (23) 268 347
Diluted headline earnings per share (cents) (24) 256 337
Adjusted headline earnings per share (cents) (25) 290 388
Diluted adjusted headline earnings per share (cents) (26) 278 377
1. CAPITAL ITEMS
Continuing operations
Loss on disposal of held-for-sale group (42) -
Impairment of held-for-sale group (29) -
Impairment of goodwill - (265)
Impairment of property, plant and equipment (7) -
Impairment of intangible assets (9) (11)
Net profit on disposal of property, plant and equipment - 36
(87) (240)
Discontinued operations
Loss on disposal of discontinued operations (730) -
Impairment of property, plant and equipment (328) (231)
Impairment of intangible assets (300) (289)
Impairment of goodwill (13) (70)
(1 371) (590)
Total (1 458) (830)

Events and circumstances leading to the recognition of significant impairment losses:
Continuing operations
Impairment on held-for-sale group arose as a result of the subsidiary being disposed of for no consideration.

Discontinued operations
Impairment of property, plant and equipment resulted due to the disposal values realised on the sale of Altech's Telecommunication Network interests in East
Africa, being lower than the carrying values of these assets.
Impairment of intangible assets relates to the impairment of the Seacom bandwidth in Altech Data International and arose due to the significant ongoing
reductions of bandwidth prices. These price decreases are a direct result of an oversupply of international bandwidth capacity, especially along the East African
coastline.
The goodwill impairment resulted from a decline in operating results and a corresponding decline in forecasted future cash flows due to lower than anticipated
activity levels without an envisaged material improvement in the short to medium term.

2013 2012
Figures in R million (Audited) (Audited)
2. RECONCILIATION BETWEEN LOSS AND HEADLINE EARNINGS
Loss attributable to Altech equity holders (937) (276)
Adjustments for:
Loss on disposal of operations 772 -
Impairment of property, plant and equipment 335 231
Impairment of intangible assets 309 300
Impairment of held-for-sale group 29 -
Impairment of goodwill 13 335
Profit on disposal of property, plant and equipment - (36)
521 554
Tax effect of adjustments (3) (11)
Non-controlling interests in adjustments (257) (205)
Headline earnings 261 338

3. RECONCILIATION BETWEEN HEADLINE EARNINGS AND ADJUSTED HEADLINE EARNINGS
Adjusted headline earnings have been presented to demonstrate the impact of some
one-off events and accounting charges on the headline earnings of the group.
Headline earnings are reconciled to adjusted headline earnings as follows:
Headline earnings 261 338
Adjustments for:
Amortisation of intangible assets arising on business combinations 29 37
IFRS 2 charge on B-BBEE transactions - 5
B-BBEE transaction costs - 6
290 386
Tax effect of adjustments (7) (8)
Adjusted headline earnings 283 378
4. DIVIDENDS
Taking into account an intention to conserve cash and enhance the group's current financial position, the board has decided not to declare a dividend in respect
of the current financial year.

The position regarding future dividends will be reviewed at the interim stage of the following financial year.
5. DISPOSALS OF SUBSIDIARIES
5.1 Continuing operations
Disposal of 75% interest in Altech West Africa Limited, classified as held-for-sale
Effective 28 February 2013 the group indirectly disposed of its 75% interest in the issued share capital of Altech West Africa Limited (AWA) on a wholly
vendor-funded basis. On 14 February 2012, the decision was taken to dispose of AWA and the operation was subsequently classified as held-for-sale. The operation
did not constitute a discontinued operation.
The disposal value at the effective date amounted to R71 million and consequently a capital loss of R42 million was incurred after an impairment of assets
classified as held-for-sale of R29 million.

5. DISPOSALS OF SUBSIDIARIES CONTINUED
Net assets of subsidiaries disposed Rm
Non-current assets 68
Current assets 73
Non-current liabilities (54)
Current liabilities (55)
Realisation of negative foreign currency translation reserve 30
Negative non-controlling interest 9

Disposal value 71
Loss on disposal of subsidiary (71)
- loss on disposal of net asset value (42)
- impairment of assets classified as held-for-sale (29)

Cash flow on disposal -
5.2 Discontinued operations
Disposal of Altech's Telecommunication Network interests in East Africa
Effective 28 February 2013, the group disposed of the following effective interests in the issued share capital of its Telecommunication Network interests in
East Africa - 60,8% in Altech Kenya Data Networks Limited (KDN), 60,8% in Africa Digital Networks Limited (ADN), 51% in Altech Swift Global Limited (ASG), 51%
in Altech Infocom Limited (Infocom), 64,7% in Altech Stream Rwanda Limited (ASR), 60,8% in Altech Data International Limited (ADI) and 60,8% in Global Digital
Trading Services Limited, to the purchaser of Liquid Telecommunications Holdings Limited.
The disposal value at the effective date amounted to R681 million, after funds advanced to subsidiaries for no consideration of R353 million, and consequently
a capital loss of R730 million was incurred, after accounting for the value (USD50 million, including a cash subscription of USD16,5 million) of the investment
received in Liquid Telecommunications Holdings Limited.

Net assets of subsidiaries disposed Rm
Non-current assets 403
Current assets 272
Non-current liabilities (202)
Current liabilities (191)
Realisation of negative foreign currency translation reserve 166
Negative non-controlling interests 233
Disposal value 681
Investment received in Liquid Telecommunications Holdings Limited (304)
Shortfall on disposal value 377
Loss on disposal of subsidiaries (730)
Cash flow on disposal - funds advanced to subsidiaries for no consideration (353)
5.3 Re-presented comparative information
The disposals of Altech's Telecommunication Network interests in East Africa resulted in the operations being classified as discontinued operations in the current
financial year. The comparative consolidated statement of comprehensive income and cash flows have been re-presented.
6. EVENTS AFTER THE REPORTING DATE
There were no events after the reporting date.

Segmental analysis
The measurement policies the group uses for segment reporting under IFRS 8 are the same as those used in its financial statements, except that certain items are not
included in arriving at the earnings before interest, tax, depreciation and amortisation (EBITDA) (foreign exchange gains and losses are excluded) and operating profit
of the operating segments (amortisation of intangibles arising on business combinations and foreign exchange gains and losses are excluded).

The segment revenue, EBITDA before capital items and operating profit before capital items generated by each of the group's reportable segments are summarised as
follows:
Revenue EBITDA
Year ended Year ended Growth Year ended Year ended Growth
2013 2012 Cur/Pyr 2013 EBITDA 2012 EBITDA Cur/Pyr
Rm Rm % Rm % Rm % %
Altech Netstar Group 1 045 1 008 3,7 291 27,8 335 33,2 (13,1)
Altech Autopage Cellular 6 027 6 069 (0,7) 253 4,2 266 4,4 (4,9)
Altech Multimedia 1 802 1 187 51,8 198 11,0 126 10,6 57,1
Converged Services International* 280 396 (29,3) (152) (54,3) 53 13,4 (386,8)
Other Altech segments 1 430 1 464 (2,3) 152 10,6 191 13,0 (20,4)
10 584 10 124 4,5 742 7,0 971 9,6 (23,6)
Amortisation of intangibles - - - - - - - -
Net foreign exchange profits/(losses) for the group - - - 17 - (26) - 165,4
Corporate and inter-segment eliminations (143) (152) (5,9) 6 - (26) - (123,1)
Altech group 10 441 9 972 4,7 765 7,3 919 9,2 (16,8)
Operating profit Depreciation
Year ended Year ended Growth Year ended Year ended Growth
2013 OM 2012 OM Cur/Pyr 2013 2012 Cur/Pyr
Rm % Rm % % Rm Rm %

Altech Netstar Group 270 25,8 311 30,9 (13,2) 16 17 (5,9)
Altech Autopage Cellular 232 3,8 244 4,0 (4,9) 21 21 -
Altech UEC Group 115 6,4 54 4,5 113,0 20 24 (16,7)
Converged Services International* (203) (72,5) (41) (10,4) 395,1 41 72 (43,1)
Other Altech segments 115 8,0 170 11,6 (32,4) 32 28 14,3
529 5,0 738 7,3 (28,3) 130 162 (19,8)
Amortisation of intangibles (16) - (37) - - - - -
Net foreign exchange profits/(losses) for the group 17 - (26) - 165,4 - - -
Corporate and inter-segment eliminations 18 - (26) - (169,2) (12) - -
Altech group 548 5,2 649 6,5 (15,6) 118 162 (27,2)

* The majority of this segment formed part of the discontinued operations.

See operational reviews for description of each segment.

Supplementary information
2013 2012
Figures in R million (Audited) (Audited)

Depreciation and amortisation 217 270
Capital expenditure 305 293
Additions to contract fulfilment costs 430 137
Net additions to customer finance lease receivables 140 49
Capital commitments 15 10
Lease commitments 418 227
Payable within the next 12 months: 97 66

- property 91 65
- plant, equipment and vehicles 6 1
Payable thereafter: 321 161

- property 311 155
- plant, equipment and vehicles 10 6

Net foreign exchange profits/(losses) (including FEC fair value adjustment) 17 (26)
Ordinary shares in issue (million)
- weighted average 97,549 97,479
- diluted average 101,880 100,341
- at year-end 97,588 97,488
Ratios
EBITDA to revenue (%) 7,3 9,2
- EBITDA to revenue (%) continuing operations 8,6 9,3
- EBITDA to revenue (%) discontinued operations (40,4) 6,8

Operating profit to revenue (%) 5,2 6,5
- Operating profit to revenue (%) continuing operations 7,0 7,5
- Operating loss to revenue (%) discontinued operations (58,9) (16,9)
Return on shareholders' equity (%) 31,5 21,2
Return on capital employed (%) 28,2 29,6
Return on operating assets (%) 18,5 21,3
Current ratio 0,8 1,1
Acid test ratio 0,6 0,9
Definitions:
Contract fulfilment costs
Contract fulfilment costs include hardware, fitment, commissions and other costs directly attributable to the negotiation and conclusion of customer service
contracts. These costs are expensed over the expected period of the customer service contract.

Customer financial lease receivables
Customer financial lease receivables represent amounts due by customers in respect of the equipment component of airtime and data usage service contracts.
The amounts due are receivable over the contract term.
Message to shareholders
The directors present the Altech Group's results for the financial year ended 28 February 2013.

The group's revenue increased to R10,441 billion. EBITDA before capital items amounted to R765 million. Operating profit before capital items was lower than that
of the prior year, mainly due to losses incurred in Altech's operations in East and West Africa. Headline earnings per share decreased to 268 cents, from 347 cents
for the prior year.
The Altech Group's operations, with the exception of East and West Africa, performed to expectations, despite weak local and international economic conditions.
Altech Multimedia, in particular, showed strong growth, with Altech UEC excelling, notwithstanding the delay in the rollout of digital terrestrial television (DTT)
in South Africa.
Since the announcement of Altech's interim results in September 2012, the group has disposed of its interest in Altech West Africa Limited (AWA) and Altech's East
African operations.
OPERATIONAL REVIEWS
Telecommunications, wireless and converged services
Altech Autopage Cellular
Altech Autopage Cellular's revenue remained almost on par with the prior year. This is a result of the continuing decline in average revenue per user (ARPU), driven
by increasing price competition among networks, mitigated during the year by improvements in internal processes and customer service at Altech Autopage Cellular.
This included the deployment of an e-billing conversion programme which created significant cost savings in addition to the creation of a paperless retail environment.
Points of presence continue to expand with the focus on reaching higher ARPU customers. To support this focus, Altech Autopage Cellular implemented a proactive customer
service analysis tracking system during the year, aimed at improving customer service throughout the business. A strategic partnership with Bytes (in the Altron Group)
was concluded for the deployment of its Genesys solution - a customer interaction management platform that allows for a complete 360° customer view. The increased focus
on customer analysis will further improve the customer's experience and Altech Autopage Cellular's offering in order to gain market share.

Altech Netstar Group
Notwithstanding a trend of declining revenue per vehicle, Altech Netstar increased total revenue to R1,04 billion. During the year, Altech Netstar successfully concluded
agreements with two new global hardware suppliers, resulting in cost reductions and improved service quality and features. The Altech Netstar UBI (User Based Insurance)
platform has also been completed and will be deployed into the insurance industry early in the new financial year.

Altech Converged Services Group
A decline in turnover for the Altech Converged Services Group was the direct result of delays in the awarding of tenders at major customers. This was further exacerbated
by disruptions related to the unrest in the mining and transport sectors. Among the local subsidiaries of Altech Radio Holdings, Altech Fleetcall performed best, following
the launch of several new products, including a push-to-talk service. The business, which is a national trunked radio network operator, has also been successful at selling
broadband products that offer simple diversification options.
During the year, Altech Alcom Radio Distributors signed a new three-year agreement with Motorola resulting in increased territories and products. The business has
consistently been recognised as one of Motorola's top distributors.
Altech Alcom Radio Distributors also assisted in the fight against rhino poaching by donating and installing 18 digital two-way radios, two dispatcher units and a
repeater at the Pilanesberg National Park.
Altech Radio Holdings and Huawei (a value-added partner to Altech) have jointly secured a significant contract with the Passenger Rail Agency of South Africa (PRASA)
to provide digital signalling network technology for South Africa's major metropolitan areas, including Gauteng, Durban and Cape Town. In essence, the technology
controls the movement of trains to ensure that they operate efficiently while improving passenger safety. The company furthermore secured a three-year contract with
police operations in Gauteng to maintain and upgrade the South African Police Service's TETRA radio network.

The Altech Stream East Africa Group, which formed part of Altech's international converged services, continued to suffer significant losses during the financial year.
Altech acquired 51% of the companies concerned in 2008. The opportunity at the time promised attractive growth opportunities based on increased availability of
bandwidth in the region. The operation was profitable for two consecutive years after acquisition, but this was subsequently eroded by the need for significant capital
investment, the collapse of international bandwidth selling prices in the East African region, the loss of key customers and interest and exchange rate volatility.
On 28 February 2013, Altech concluded a transaction in which it realigned its East African network interests by injecting them into a strategic partnership with Liquid
Telecommunications Holdings ("Liquid"), thereby acquiring a minority interest in Liquid.

Multi-media and electronics
Altech Multimedia (incorporating Altech UEC)
Growth in Altech Multimedia was achieved across all lines of business (consisting of devices, support services and system integrated solutions), both in Africa and
internationally. Revenue increased to R1,8 billion, with Altech UEC South Africa and Altech Multimedia Europe being the top performers.

Altech UEC is successfully transforming its business model to balance the traditional device manufacturing business with a services and solutions based business.
Growth in other markets more than compensated for the delay in the DTT rollout in South Africa, including increasing sales into Africa, Turkey and Australia. A new
deal was also signed in Angola to supply set-top boxes (STBs) into the region. A total of 2,8 million STBs were produced in South Africa during the year, contributing
to a significant improvement in operating profit to R115 million.
Significant cost savings were also achieved by consolidating and increasing Altech UEC's capacity at Altech Multimedia's India Design Centre (IDC). A total of 52
employees there are now responsible for all software driver development work for the Altech Group.
Arrow Altech Distribution (AAD)
After an excellent performance in 2012, Arrow Altech Distribution experienced a decline in revenue during 2013, resulting in an operating profit of R21,7 million
(2012: R30,2 million). To mitigate the risk of short product cycles and the rapid development of substitute products, Arrow Altech Distribution had been focusing
on streamlining its demand creation initiatives this year, resulting in an increase in design registrations which will result in market share growth in the next
financial year. The business concluded three new supplier agreements with Murata, Cinterion and Microsoft during the year.
Arrow Altech Distribution also received the Conlog Supplier of the Year Award for the second consecutive year.
Information Technology
Altech's Information Technology operations showed good results excluding the results of Altech West Africa (AWA), which was sold with effect from 28 February 2013.
The division's revenue remained steady, with a small decline compared to the previous period. Operating profit declined mainly due to a loss of almost R40 million
incurred by AWA, which had been highly profitable for most of the period since its inception, but became loss-making due to a reduction in demand for its secure
recharge vouchers and delays in the up-take of plastic chip cards. In addition, its pioneer tax status expired and barriers to imported competition were removed.
An important managed retail and wholesale billing services contract was secured for a further two years by Altech ISIS.
Altech Card Solutions and Altech ISIS were the most significant contributors to operating profit in the division. Altech Nupay also performed well, following accelerated
growth in unsecured lending.
Altech Eyenza Mobile Money's e-Wallet solution was launched during 2012 and the business has signed up a number of affiliates. In the next financial year Altech Eyenza
Mobile Money will launch an optional card coupled to its e-Wallet to attract new customers into the electronic transacting environment. This will become part of a
longer-term strategy to create a direct consumer interface for Altech Eyenza Mobile Money.
Of strategic importance in this division was Altech's ability to increase its presence in the payment industry, positioning the group as a significant player in this
field.
STRATEGIC REVIEW
Huawei partnership
Altech signed a long-term value-added partner agreement with Huawei, a leading global information and communications technology (ICT) solutions provider, during the
year. Huawei is the world's largest telecommunications equipment manufacturer.
Under the agreement, Altech will provide Huawei Enterprise products and services to customers, and offer post-sales professional services and support in countries
across southern and East Africa. The partnership with Huawei extends Altech's existing solutions into the enterprise market and will result in enhanced services for
our customers and will provide them with access to quality, affordable technology, supported by a partner that is well aligned with our focus on customer service and
innovative technology solutions.
With this partnership, Altech now offers IT solutions such as cloud services, unified communications and transmission solutions, network and application security
services, data centre networking and storage solutions and IT infrastructure services.
Innovation
The Altech Group aims to substantially increase its revenue within five years. To achieve this, we have created three growth threads beyond organic growth in our
existing businesses:
1. The strategic relationship with Huawei to expand our offering in terms of products and services into Africa.
2. Accelerated focus on opportunities through converged solutions.
3. Global telematics development which delivers both increased value to customers and geographical expansion.
The first major enabling initiative during the past year was the establishment of an Altech Growth Management Office (GMO). The GMO provides capacity and aligns the
group's initiatives by, inter alia, developing a go-to-market strategy for new products and services.
Projects that have been launched during the year include insurance telematics solutions, the development of secure digital content devices, new payment instruments
and solutions using e-Wallets and microfinancing opportunities.
Transformation
The Altech Group maintained a Level 3 B-BBEE status for the financial year. The group strives to create a work environment of diversity and equal opportunity and to
transform the company in a way that ensures it is an employer and supplier of choice. Transformation initiatives during the year were aligned with the broader group's
vision contained in Altron's "Beyond 2012" transformation philosophy.
Several key appointments were made during the past 18 months which have given us the benefit of highly qualified and experienced resources to support our decision-making
and strategic planning in a very challenging period.

CORPORATE ACTIVITY
Salient transactions and arrangements involving the Altech Group during the financial year ended 28 February 2013 are as follows:
Altech West Africa
Altech West Africa Ltd (AWA) was classified as held-for-sale during the 2012 financial year. Despite the fact that AWA was highly profitable for most of the period
since its inception in 2005, the costs involved in maintaining Altech management control of AWA from South Africa, additional investment required to enhance AWA's
production facilities, in addition to the fact that AWA's product area is non-core to the Altech Group, resulted in the decision to dispose of Altech's 75% interest
in AWA.

The sale of AWA was a vendor-funded transaction. Altech sold its interests in AWA via its intermediate South African holding company, for rand-denominated redeemable
preference shares in the purchaser, equivalent to US$4,9 million.
Altech East Africa
As advised in SENS and press announcements published on 28 January 2013 and 14 March 2013, with effect from 28 February 2013, Altech concluded a transaction in which
it realigned its East African network interests by injecting them into a strategic partnership with a significant African telecommunications network operator, Liquid
Telecommunications Holdings Limited ("Liquid"), thereby acquiring a minority interest in Liquid. The transaction has created the largest single fibre-optic network in
Africa.
Altech has contributed its majority interests in Altech East Africa and has subscribed for US$16,5 million of new shares in Liquid, to give it an initial 8,6% equity
stake in the company, with current shareholder voting rights of 10% and the possibility of increasing the shareholding in Liquid in the future. Altech will also, for
as long as it holds at least 5% of the issued share capital of Liquid, be entitled to one director on the board of Liquid.

The sale of the companies concerned was on a net debt and cash-free basis, whereby Altech assumed KES3,0 billion (approximately equivalent to R309 million) of their
loan funding and discharged their over 30-day creditors.

In the event of a listing by the Liquid group on a stock exchange, provision is made for an exchange of Altech's interest in Liquid for shares in the listing entity,
based on the greater of an independently determined fair market value or, in the first year after the conclusion of the transaction, US$50 million (i.e. R454 million).
The transaction includes evergreen mutual put/call options, relating to Altech's shares in Liquid, at an independent merchant bank valuation, with a similar US$50
million value underpin during the first year.
THE WAY FORWARD
With the disposal of Altech's East and West African operations, the group is positioned to return to its normal pattern of growth. Over the past 16 years the group has
been acquiring and building a strong and competitive portfolio of businesses in the Telecommunications, Multi-media and Information Technology (TMT) space. We believe
that we are now in a position to unlock value from innovation and convergence through these assets, and enhance our activity base by further exploiting our intellectual
property.
Working capital and cost management will remain material focus areas for the medium term. The group is also committed to becoming increasingly customer-centric.

We plan to build on the tender, contract and relationships achievements for 2013 by co-creating value with all our South African and international partners.
We believe that the Huawei partnership, in particular, has been shown to be even more important and strategic than originally anticipated.
In terms of our business culture we believe that the past year's focus on the Altech Way will encourage our strong team of employees to act and perform in line with
the values and sustainability strategy of the Altech Group.
This outlook has not been reviewed or reported on by Altech's external auditors.
Taking into account an intention to conserve cash and enhance the group's current financial position, the board has decided not to declare a dividend in respect of
the financial year ended 28 February 2013.
The position regarding future dividends will be reviewed at the forthcoming interim stage.

Moss Leoka
Non-executive chairman
Craig Venter
Chief executive officer
Dr John Carstens
Chief financial officer

23 April 2013

Corporate information

DIRECTORS
Executive directors
CG Venter (Chief executive officer)
Dr JEW Carstens (Chief financial officer)
Independent non-executive directors
ML Leoka (Chairman)
AD Dixon
SN Mabaso-Koyana
R Naidoo
RS Ntuli (Lead independent)
M Sindane
Non-executive directors
PMO Curle
Dr HA Serebro
AMR Smith
Dr WP Venter
RE Venter

CORPORATE AND BUSINESS OFFICE
Woodmead North Office Park
54 Maxwell Drive
Woodmead
Johannesburg 2191
(PO Box 153, Bergvlei 2012)
Telephone: +27 (0) 11 715 9000
Telefax: +27 (0) 11 715 9048
Website: www.altech.com

SECRETARIES AND REGISTERED OFFICE
Altech Management Services (Pty) Limited
Woodmead North Office Park
54 Maxwell Drive
Woodmead
Johannesburg 2191
(PO Box 153, Bergvlei 2012)
Telephone: +27 (0) 11 715 9000
Telefax: +27 (0) 11 715 9048
Website: www.altech.com
TRANSFER SECRETARIES
Computershare Investor Services (Pty) Limited
70 Marshall Street
Johannesburg 2001
PO Box 61051, Marshalltown 2107, South Africa
Telephone: +27 (0) 11 370 5000
AUDITORS
KPMG Inc.
85 Empire Road
Parktown 2193
Telephone: +27 (0) 11 647 7111
BANKERS
Absa Bank Limited
Nedbank, a division of Nedcor Bank Limited
SPONSOR
Investec Bank Limited

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