Company Notes


 
Notes to the Company Annual Financial Statements
for the year ended 30 June 2011
 
 
    2011  
R’million  
  2010  
R’million  
10.   PREFERENCE SHARE CAPITAL        
  Authorised        
  17 600 000 (2010: 17 600 000) cumulative, variable rate A preference shares with a par value of 13,90607 cents each   2,4     2,4  
  20 000 000 (2010: 20 000 000) non-redeemable, non-participating variable rate B preference shares with a par value of 13,90607 cents each   2,8     2,8  
  Issued        
  17 600 000 (2010: 17 600 000) cumulative, variable rate A preference shares with a par value of 13,90607 cents each, issued at R21,41 during June 2005   2,4     2,4  
  Share premium   374,4     374,4  
    376,8     376,8  
  Rights attached to the A preference shares        
  Dividend rights  
Preference share dividends are calculated at the South African prime overdraft rate of interest as charged by First National Bank, a division of FirstRand Bank Ltd from time-to-time multiplied by one minus the corporate tax rate for the relevant dividend period. Dividends are payable on 10 June of each year.  
     
  The preference shares dividends rate was 6,5% at year-end (2010: 7,2%).        
  Voting rights  
Each Aspen preference share has one vote and accordingly ranks pari passu in regard to votes with the issued Aspen ordinary shares.  
     
  Redemption/conversion rights  
Preference shareholders have the right to require the redemption or conversion of the Aspen preference shares into Aspen ordinary shares on a one-for-one basis on the seventh anniversary after the issue of the Aspen preference shares, being June 2012. Redemption will take place at R21,41.  
     
  The conditions or rights of the preference shares are available for inspection at the Company’s registered office.        
  Accounting  
For accounting purposes the preference shares have been split into an equity and a liability component. Refer to the accounting policy.  
     
  Preference shares – equity component (per the statement of changes in equity)  162,0     162,0  
  Deferred tax effect   (8,7)    (8,7) 
  Net equity component   153,3     153,3  
  Preference shares – liability component (per the statement of financial position)  381,3     386,6  
  Amount expensed in 2005   (183,2)    (183,2) 
  Cumulative notional interest on liability component   25,4     20,1  
  Opening balance   20,1     14,5  
  Current year   5,3     5,6  
    376,8     376,8  
  The fair value of the liability component of the preference shares is R381,5 million (2010: R386,8 million). The liability component is exposed to fair value interest rate risk.  
  The effective interest rate of the liability component is 9,0% (2010: 10,0%).