Directors’ report
for the year ended 30 September 2009

   
 

AUTHORISED AND ISSUED CAPITAL

The authorised capital of the company remained unchanged.

During the year 74 000 (2008: 454 040) ordinary shares were issued at R15,99 per share and 189 100 (2008: 154 600) at R41,90 per share. The following issues were made in the previous year: 10 000 at R14,10 per share, 40 200 at R15,80 per share, 66 800 at R17,30 per share, and 23 000 at R17,70 per share. Options exercised in terms of the Reunert 1985 Share Option Scheme accounted for this increase.

REVIEW OF OPERATIONS AND RESULTS

The performance of the divisions’ and the group’s results are reviewed here and the segmental analysis is set out here.

DIVIDENDS

An interim ordinary dividend No 166 of 65 cents (2008: No 164 of 78 cents) per share was declared on 13 May 2009, and a final ordinary dividend No 167 of 188 cents (2008: No 165 of 241 cents) per share was declared on 17 November 2009.

A total distribution of 253 cents (2008: 319 cents) per ordinary share was declared relating to the 2009 financial year.

An interim 5,5% cumulative preference dividend No 48 was declared on 7 July 2009 and a final dividend No 49 will be declared on 31 December 2009.

SUBSIDIARY COMPANIES

Your directors are of the opinion that the publication of information on all the company’s subsidiaries in this report would entail expense out of proportion to the value to shareholders.

Annexure A to this report, however, sets out the principal subsidiaries of the company.

SPECIAL RESOLUTIONS OF SUBSIDIARIES

During this financial year the following special resolutions were passed by subsidiaries of Reunert: Blue Lake Investments (Pty) Limited increased its share capital. Reutech Precision Products (Pty) Limited changed its name to Fuchs Electronics (Pty) Limited. Reutech Commercial Enterprises (Pty) Limited changed its name to Reutech Mining (Pty) Limited and altered itsMemorandum of Association. Reunert Limited had acquisitions by the company or its subsidiaries in terms of sections 85(2) and 85(3). Telkor Business Systems (Pty) Limited changed its name to Reunert Executive Services (Pty) Limited and altered its Memorandum of Association. Full details of these resolutions may be viewed at the company’s registered office.

DIRECTORATE AND COMPANY SECRETARY

Directors are subject to retirement by rotation and re-election by shareholders at an annual general meeting at least once every three years in terms of the company’s articles of association. The board charter is an integral part of the conditions of appointment of all directors. Procedures for appointments are formal and transparent and a matter for the board as a whole to consider.

Non-executive directors retire after reaching the age of 70 at the next annual general meeting. Executive directors retire from the board at 63 years of age at the following annual general meeting.

Mr R van Rooyen and Ms KW Mzondeki, having been elected to the board on 1 November 2009, are required to retire at the next annual general meeting, but being eligible, offer themselves for re-election. Messrs BP Connellan, KJ Makwetla and GH Oosthuizen retire by rotation at the next annual general meeting. The nomination committee, at its meeting held on 17 November 2009, has recommended that they be re-elected and they have offered themselves for re-election.

Mr Martin Shaw who was requested by the board to stay for another year after turning 70 last year, resigned as chairman of the board in May 2009. Mr TS Munday was appointed chairman. Mr Shaw, together with Mr KS Fuller having reached retirement age, will retire at the forthcoming annual general meeting. Mr SD Jagoe has indicated that he will resign from the board at the next board meeting to pursue his own consultancy business overseas.

The names of the directors in office at 30 September 2009 and to the date of this report, are set out here. The name and address of the company secretaries are set out on the inside back cover.

INTERESTS OF DIRECTORS

At the reporting date, fully paid ordinary Reunert shares were held directly and indirectly by the directors as indicated in the table below:

Direct beneficial Indirect beneficial Held by associates Total
  2009  2008  2009  2008  2009  2008  2009  2008 
BP Connellan 30 523  30 523  9 000  9 000  —  —  39 523  39 523 
BP Gallagher 331 713  331 713  —  —  —  —  331 713  331 713 
KJ Makwetla —  —  —  —  150  150  150  150 
TS Munday —  —  4 700  —  —  —  4 700  — 
GJ Oosthuizen 66 700  66 700  —  —  —  —  66 700   66 700 
ND Orleyn* —  —  —  —  1 554 000  1 554 000  1 554 000  1 554 000 
G Pretorius 133 400  133 400  —  —  —  —  133 400  133 400 
DJ Rawlinson 358 520  358 520  —  —  —  —  358 520  358 520 
  920 856  920 856  13 700  9 000  1 554 150  1 554 150  2 488 706   2 484 006 
* These shares are held indirectly through Bargenel’s investment in Reunert which relates to the BEE deal concluded in 2007.
  These holdings have remained unchanged from 30 September 2009 up to 17 November 2009.
 

Executive directors of the company held unexercised options to subscribe for 280 000 (2008: 280 000) ordinary shares in terms of the Reunert 1985 Share Option Scheme. These options are due to expire on 29 August 2015. Executive directors of the company held unexercised options to subscribe for 250 000 (2008: 250 000) ordinary shares in terms of the Reunert 2006 Share Option Scheme. These options are due to expire on 18 June 2019.

The directors have no financial interest in contracts entered into by the group during the year. For further information on directors’ share options, refer to note 28 of the annual financial statements.

SUBSEQUENT EVENTS

Reunert has concluded an agreement to acquire Siemens’ remaining 60% shareholding in SEC. Final approval by the Competition Authorities was granted on 29 October 2009.

ATTRIBUTABLE INTEREST

The attributable interest of the company in the profits and losses of its consolidated subsidiaries for the year ended 30 September 2009 is:

  2009  
 Rm  
2008  
Rm  
In the aggregate net income 698,9   760,1  
In the aggregate net losses (42,2)  (36,7) 
  656,7   723,4  


GOING CONCERN

The directors confirm that the group and company have adequate resources to operate for the foreseeable future and will remain a viable going concern in the year ahead.