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Finweek English Edition - - COMPANIES & MARKETS -

THIS HAS BEEN an un­duly long piece of cor­po­rate ac­tion, largely be­cause of its for­mer board of direc­tors. In­terim re­sults (to end-March) with Kan­sai Paint now in con­trol were ter­ri­ble.

Head­line earn­ings per share dropped by 50% and cash flow was down 47%. It’s not a great start for the new con­trol­ling share­holder. But Kan­sai was at pains to point out that – bar­ring “un­usual items” – EBITDA would have de­clined by only 9% in­stead of the 32% it fell by to R152m.

The un­usual items are R20m, re­lat­ing to the merger trans­ac­tion costs, and R30m in terms of ac­count­ing reg­u­la­tions about the al­lo­ca­tion of share ap­pre­ci­a­tion rights. The share scheme was ap­proved in Septem­ber 2008 and is­sued in Fe­bru­ary this year.

Not be­ing aware of the de­tails of the share ap­pre­ci­a­tion rights, it may be sig­nif­i­cant in that not long af­ter the is­sue, the

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