Allied Electronics Corporation Limited

Abridged audited consolidated financial statements for the year ended 28 February 2007

Notes			R millions

Basis of preparation
The abridged consolidated financial statements have been prepared in accordance with the measurement Abridged audited consolidated financial statements for the year ended 28 February 2007 Accounting Standards Board (IASB) in issue and effective at 28 February 2007, the presentation as well as the disclosure requirements of IAS34, Interim Financial Reporting and in compliance with the listing requirements of the JSE Limited.




The accounting policies followed are consistent with those adopted in the prior year except as follows: Circular 9/2006 - Transactions giving rise to Adjustments to Revenue/Purchases

The Group previously reflected discounts received from suppliers as other income and discounts granted as operating expenses. In terms of circular 09/2006 issued by the South African Institute of Chartered Accountants, the Group now accounts for discounts received from suppliers as part of cost of sales and discounts granted as a reduction of revenue. In order to present the year to 28 February 2006 on a consistent basis the following restatements have been made:

			Year ended
			28 Feb 2006
Decrease in revenue			56
Decrease in materials and services			56

		2007	2006
		(Audited)	(Audited)

Headline earnings per share (cents)	51%	286	189
Diluted headline earnings per share (cents)	42%	250	176


1. Capital items
Net gain on disposal of property, plant and equipment		33	7
Impairment losses		(61)	(100)
Goodwill adjustment on utilisation of at acquisition tax losses		(19)	(38)
Net gain on disposal and closure of businesses		9	65
Profit on disposal of investments		-	3
Foreign currency translation reserve realised		-	9
		(38)	(54)

2. Reconciliation between earnings and
headline earnings
Attributable to Altron equity holders		805	494
Capital items - gross		38	54
Tax effect of capital items		(5)	9
Minority interest in capital items		(36)	(28)
Headline earnings		802	529

3. Reconciliation between attributable earnings and
diluted earnings
Attributable to Altron equity holders		805	494
Additional earnings attributable to BEE minorities in subsidiaries		(87)	(21)
Minority interest in adjustments		11	10
Dilution in earnings of subsidiary dilutive options		(12)	(14)
Diluted earnings		717	469

4. Reconciliation between headline earnings and
diluted headline earnings
Headline earnings		802	529
Additional earnings attributable to BEE minorities in subsidiaries		(82)	(29)
Minority interest in adjustments		13	13
Dilution in earnings of subsidiary dilutive options		(15)	(15)
Diluted headline earnings		718	498

Notes (cont)

Fully diluted earnings and diluted headline earnings have been calculated in accordance with
IAS 33 - Earnings per share on the basis that:
Kagiso Strategic Investments (Pty) Ltd exercised its full option on 22% of the shares in Bytes Technology Group South Africa (Pty) Ltd adjusted for the dilutive effect of the option price at BTG SA level. The recognition of the deferred sale of a 30% interest to the Izingwe Consortium in Aberdare Cables based on the assumption that the purchase price will be settled in cash of R165 million, adjusted for the dilutive effect of the option price at the Powertech level. The effective option was antidilutive in the prior year and so caused no dilution in that period. The dilution in earnings of subsidiary dilutive options.
The calculations for the comparative period have been restated to achive consistency, the effects of which are
insignificant.

5. Disposals
During the second half of the year the directors of Bytes took a decision to dispose of the Bytes' shareholding
in Bytes IT Solutions Limited ("Plato"). This operation is consequently classified as held for sale as at
28 February 2007 and the net assets have been valued at R4 million which is the lower of the carrying amount
of the net assets and the fair value less costs to sell. Accordingly the carrying value of the net tangible assets
held-for-sale has been impaired by R6 million and the remaining goodwill of R50 million has being fully impaired.

6. Acquisitions of subsidiaries and joint ventures
The Bytes group acquired the entire shareholding of two Xerox dealers in the UK, Xclusive Solutions and Vantage
Business Systems, for an aggregate cash consideration of R65 million. As well as local operations Zenith
Systems, TMS 2000 and Silverminute for R15 million.
Altech acquired Mobimaster ,a French telecommunications billing systems provider for R25 million.
The acquisitions contributed R 250 million to group revenue and R 22 million to profit for the year.

	Recognised	Fair value	Carrying
Subsidiaries	values	adjustments	amount
Non-current assets	7	30	37
Current assets	48	-	48
Non-current liabilities	-	(5)	(5)
Current liabilities	(46)	-	(46)
Net identifiable assets and liabilities	9	25	34
Goodwill on acquisition			71
Total consideration			105

Joint venture - CBI Electric Aberdare ATC Telecom Cables (Proprietary) Limited
	Recognised	Fair value	Carrying
	values	adjustments	amount
Non-current assets	58	4	62
Current assets	7		7
Non-current liabilities	-	(15)	(15)
Net identifiable assets and liabilities	65	(11)	54
Goodwill on acquisition			15
Total consideration			69
Non-current asset disposals			(22)
Gain on disposal of assets			(32)
Amount owing			(15)
Net consideration			-

7. Auditors' report
KPMG Inc's unmodified auditors' report included in the consolidated annual financial statements and on the
abridged consolidated financial statements contained in this abridged report are available for inspection
at the company's registered office.

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