Document 6RMqj7arknqLNNDe2qmDKLMz6

FILE NAME Cape Asbestos CAPE DATE 1980 Mar DOC CAPE183 DOCUMENT DESCRIPTION Consolidated Profit and Loss Account - Charter Consolidated Ltd. & Subsidiaries Legal - Tibbs Case Exhibit 81 Consolidated loss profit and Year ended 31 March 1980 account Charter Consolidated Limited and its subsidiary companies bo ; Revenue | . Operating profit of industrial subsidiaries note ) < Income from investments note 2 Share of retained profits less losses of associated companies note 4 _ Surplus on realizations ofinivestments nvestments .. Interest receivable . Expenditure Lo , Expenditure technical Administration and Prospecting note1 ; ~ Interest payable note 3 ') - | : . 1980 000 19,790 18,422 13,463 5,758 6,206 63,639 s 3,601 699 6,990 1979 000 20,887 19,517 56 11,990 4,059 56,397 : . . 3,771 1,079 . 7,000 11,290 11,850 taxation = = . : Taxation note Bg extraordinary Profit after taxation before items outside shareholders - Deduct Interest of profits of subsidiaries shareholders ; in . ; a , attributable Charter Earnings per share 26.63p 1979 Dividends paid and proposed note 21.93p note 7 52,349 : 20,752 31,597 ~ 3,659 44.547 F 17,965 26,582 3,591 27,938 : 22,991 8,760 | 9,043 Add Extraordinary items 1979- deduct note 8 = Retained profit transferred to reserves Profit for the year after extraordinary items ~, ae totalled 82,489,000 82,489,000 1979 17,309,000 7 oon :f r 19,178 54,551 73,729 13,948 5,682 8,266 Movements on reserves _, Reserves at 31 March 1979 ae Retained profit for the year : Reduction in reserves as a scheme . arrangement note 18 Elimination of associated company reserves on their ceasing to ~) associated companies Premium 1979 discount on purchase of shares of subsidiary companies Surplus on revaluation of a subsidiary's freehold property 159,810 73,729 10,528 12,035 334 _-. Reserves at 31 March 1980 note 17 210,642 150,467 . 8,266 Be _ . a 94 983 159,810 The accounting policies on pages 20 and 21 and the notes on pages 26 to 35 form part of these accounts Consolidated balance sheet ~ 31 March 1980 Charter Consolidated Limited and its subsidiary companies Fixed assets noto Exploration and development development expenditure Investments note 11 : Market or directors valuation 242,175,000 1979 282,239,000 valuation : Current assets -. Stocks and work in progress note 12 - Debtors loans obs Short term loans and deposits Bank and cash balances 1980 000 000 68,336 113 142,711 1979 000 630 74,905 122 158,306 51,804 59, 565 48,550 1,890 . Current liabilities =: 193,243 _ Associated companies and other deposit accounts .. Bank loans and overdrafts secured - 503,000 . 1979 1,358,000 ; = Unsecured 6 per cent DM bonds repaid 1 April 1980 " Creditors note 13 : 4 Taxation Proposed Proposed final dividend 11,726 9,605 19,002 71,325 21,212 5,247 161,809 _ _ _ 5,938 24,301,. 67,356 5,863 5,871 Net current assets Deferredtaxation note 6 138,117 a 109,329 52,480 10,880 Financed by Share capital note 15 Share premium account note 16 Reserves note 17 Total capital and reserves Capital expenditure grants Interest of outside shareholders in subsidiaries Long term indebtedness note 14 N. CLARKE B. W. PAIN Directors 273,704 _ __ _ 296,693 26,215 30,695 159,810 216,720 2,560 20,736 56.677 296,693 , The accounting policies on pages 20 and 21 and the notes on pages 26 35 form part of these accounts Balance sheet 31 March 1980 : Charter Consolidated Limited Subsidiary companies Shares at cost or valuation Add : Amounts due from subsidiaries Deduct subsidiaries Amounts due to subsidiaries Current assets :. Bank baiances Deferred asset Advance corporation tax note Financed by Share capital note 15 Share premium account note 16 Reserves note 17 Total capital and reserves Long term indebtedness note 14 Current liabilities Creditors Taxation Proposed final dividend 1980 000 93,779 63 93.779 37,265 2,249 - 11,025 26,215 18,702 4,626 49,543 2,337 J. N. CLARKE B. W. PAIN Directors The accounting policies on pages 20 and 21 and the notes on pages 26 to 35 form part of these accounts 24 Source and application of funds Year ended 31 March 1980 Charter Consolidated Limited and subsidiary companies SOURCE OF FUNDS Profit before taxation : Extraordinary items - restructuring of the group and before - taxation of 24,192,000 2 Other items before interest of outside shareholders and adjusted for taxation relief of 9,450,000 1979 - 16,162,000 Adjustments Adjustments for items not involving movementsoffunds Depreciation Provisions against mining projects and investments Effect of currency translation on loans investments and fixed assets - Share of retained profits less losses of associated companies . Funds generated Disposal of fixed assets Increase in government grants : : APPLICATION OF FUNDS Purchase of fixed assets Transfer of investments and cash as part the scheme of arrangement note 20 Investments note iv Goodwill on acquisition of subsidiaries Taxation paid Decrease in long term indebtedness Unsecured 6 per cent DM loan bonds note 20 iii Other Increase in working capital and other items note 20 Dividends paid Increase in liquid funds 1980 000 000 52,349 Fe 78,421 a 9,420 121,350 : 481 8,678 .. 5,632 : 126,982 15,836 ~ = 265 . 16.101 143,083 18,492 53,347 5.943 334 8.375 8,822 4,510 5,504 9,384 114,711 28,372 1979 1979 900 000 44,547 : 22.241 Increase in short term loans deposits and cash Increase in associated companies and other deposit accounts Decrease in bank loans and overdrafts 28,372 25.378 1.441 7,826 -- 16.111 source and of The accounting policies on pages 20 and and the notes on pages 26 to 35 form part of these accounts Notes on the application funds are in note 20 on page 35 Consolidated Limited Annual report and accounts for the year ended 31 March 1980 tie Pascentot san hewts enatmrhiey COVER PICTURE factory Rock bolts in the furnace at the Worksop of en Torque Tension Limited Contents meeting 2 Important 2 Directors 3 summary 4 Chairman's introduction 5 executive's report 6 Review of interests and operations 9 directors 16 auditors 19 Accounting policies 20 Consolidated profit and loss account 22 Consolidated balance sheet 23 Balance sheet 24 Source and application of funds 25 accounts 26 Principal 36 Analysis of assets and income Five year financial record 39 Subsidiary companies 40 information 42 directory 43 Notice of meeting NOTICE IS HEREBY GIVEN that the fifteenth annual general meeting of members of Charter Consolidated Limited will be held at Winchester House 100 Old Broad Street London EC2N 1BU on Thursday 7 August 1980 at 12 noon for the following purposes To consider the accounts and the report of the directors for the year to 31 March 1980 2. To declare a final dividend To reappoint as directors Dr A. Spinks Mr M. B. Hofmeyr Mr G. W. H. Relly and Mr P. C. : D. : Burnell To reappoint Coopers & Lybrand and Deloitte Haskins & Sells as joint auditors and authorize the board to fix their remuneration To consider the following resolution which will be proposed as an ordinary resolution That the authorized share capital of the company be and is hereby increased from 2,681,712.52 to 2,700,000 divided into 135,000,000 shares of 2p each by the creation of 914,374 shares of 2p each To consider the following resolution which will be proposed as a special resolution That the articles of association of the company be and are hereby amended by the deletion of the first sentence of article 85 and the substitution therefor of the following sentence Each of the Directors other than a Director holding salaried office or employment under the Company shall be entitled to remuneration at the rate of 4,000 per annum or otherwise at a rate to be determined by the Directors up to a maximum of 6,000 per annum or such other amount as the Company may by Ordinary Resolu- tion determine A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend and on a poll to vote instead of him A proxy need not be a member of the company A form of proxy accompanies this notice ; by order of the board D. S. BOOTH 40 Holborn Viaduct secretary London EC1P TAJ 10 July 1980 NOTES 1. Holders of share warrants to bearer who wish to attend in person or by proxy or to vote at the meeting must comply with the relevant conditions governing share warrants to bearer see page 44 2. To be valid the form of proxy must reach the company at PO Box 102 Charter House Park Street Ashford Kent TN23 not less than 48 hours before the meeting 3. There are no directors service contracts required by The Stock Exchange to be made available for inspection at the meeting ; Important dates subject to change if unforeseen circumstances arise 1980 Annual general meeting Thursday 7 August Payment of final dividend Saturday 9 August Declaration of interim dividend and publication of yearly report Tuesday 2 December 1981 _ Payment of interim dividend Friday 9 January Recommendation of final dividend and publication of consolidated profit statement Tuesday 23 June Posting of annual report and accounts Thursday 9 July Directors Chairman Dr A. Spinks C^ EFRS Deputy chairman Sir Philip Oppenheimer Chief executive N. Clarke Directors P. D. Burnell H. Collins MBE DSC O. Hambro MC G A. Higham M. B. Hofmeyr F J. A. Howard H. Oppenheimer W. Owston B W. Pain G. Relly G. Richardson M. W. Thomas J. Ogilvie Thompson Alternate directors R. J. Armitage D. Ballardie J. Cleasby A. E. Oppenheimer M. J. Statham Secretary D. Booth executive directors Financial summary Profit before taxation Attributable earnings Extraordinary items 1979 deficit Net assets including appreciation of investments 1980 million 52.3 27.9 54.6 1979 million 324.3 Earnings per share Dividends per share Net assets per share 26.6p 8.35p 309p 21.9p 8.62p 325p im; NOTE during The results cover the restructuring which occurred the financial year and are not directly comparable with those of the previous year Similarly the figures taken from the balance sheet at 31 March 1980 reflect the reduction of capital under which shareholders received in respect of quarter each Charter share one of share in Minerals and Resources Corporation Limited MINORCO worth at the of time the offer 55p At the time of the restructuring the directors of MINORCO forecast a gross dividend equivalent Charter share to 1.73p per to be paid in November 1980 Chairman's introduction The year was exceptionally important for Charter because of the major restructuring which took place The distribution and balance of assets our and business interests were substantially changed by the disposal of of most our holdings in South African mining investments in exchange we acquired together with cash and other assets a 28 per cent holding in Johnson Matthey & Co. which becomes an associated company and provides a valuable addition to our expanding industrial interests The restructuring also involved a reduction of capital to enable shareholders to participate directly in Minerals and Resources Corporation a Bermudian based holding company with mining and industrial investments mainly in North America a The profits achieved during the year are thus not directly comparable with those of earlier years Nevertheless they show pleasing overall increase given the difficult business environment 1979 There have also been major organizational changes and I should like to express special thanks to Murray Hofmeyr who left to take up a senior appointment with Anglo American Corporation of South Africa in Johannesburg after seven years as managing director of Charter four of them also as chairman Murray provided outstanding leadership during a period of considerable difficulty and will be greatly missed I should also like to pay a tribute to Lionel Stopford Sackville an executive director who resigned during the year His skill and experience particularly in financial matters made a most valuable contribution to our business over many years have joined Charter at a time of great challenge for the British and the company The inevitably adverse initial effects of the economy British government's rigorous monetary policy are falling mainly on the United Kingdom manufacturing sector British industry faces weak demand rapidly rising costs and intense foreign competition which has increased with the strengthening of sterling All this must restrain the growth of Charter's industrial subsidiaries for some time but the achievement of significantly lower inflation is an objective sufficiently important to justify acceptance of some temporary adversity Under the company's restructuring scheme Charter received a substantial amount of cash part of which was used to repay the deutsche mark loan so that the gearing element in Charter's capital structure is now very low Furthermore our cash assets and borrowing capacity are backed by strong and diversified portfolio of investments which could be used to supplement these resources We expect that government policies will lead to an improvement in the economic climate and Charter is thus well placed to develop its mining and industrial interests and we are actively seeking suitable opportunities to do this by expansion or acquisition London 24 June 1980 A. SPINKS chairman Chief executive's report Charter's profits for the year to 31 March 1980 before tax and extraordinary items were 52.3 million and earnings after tax were 27.9 million 1979 23.0 million equivalent to 26.6p per share 1979-21.9p 1979-21.9p 1979-21.9p per share The restructuring of Charter took place effectively in the middle ofthe accounting year and the results cover the period of change They are not therefore directly comparable with the previous year but nevertheless can be regarded as satisfactory The restructuring represented a significant development for the company and for shareholders who following the reduction ofcapital received for every four shares held in Charter one share in Minerals Minerals and Resources Corporation MINORCO We disposed of nearly all our investments in South Africa and adjoining territories including in particular our holdings in Anglo American Corporation of South Africa AAC Anglo American Investment Trust ANAMINT and Rustenburg Platinum Holdings We also sold our interests in the Anglo American Corporation regional companies in Australia and Brazil together with part of our holding in Anglo acquired American Corporation of Canada AMCAN In exchange we acquired a 28 per cent holding in Johnson Matthey & Co. and increased our interest in Tara Exploration and Development Company and Soci^'t^M'ini^re d'Anglade We received a payment in cash which after providing for estimated tax liabilities amounted to 31 million This contributed substantially to our cash resources as well as providing the funds required to prepay the loan in deutsche marks which we raised in circumstances when direct investments overseas had to be financed from foreign borrowings We have thereby eliminated the risk of further losses in this respect through exchange rate movements The exchangeof assets gave rise to an overall profit which after providing for the tax applicable to the various transactions amounted to 54.2 million and this sum has been credited to extraordinary items Following the reduction of capital under which shareholders received one quarter of MINORCO share worth approximately 55p for each Charter share the net value of Charter's assets at the year end was 324 million equivalent to 309p per share The asset value at the end of the previous year prior to the capital reduction was 341 million or 325p per share The operating profits of Charter's industrial subsidiaries amounted to 19.8 million compared with 20.9 million in the previous year The sale by Cape Industries of its mining division resulted in a loss of contribution of 1.6 million for the year and the results of Cape's automotive and engineering division were disappointing However the excellent performance of the building and insulation division meant that Cape's operating profits were only marginally lower than in 1978. The strikes by the road hauliers and the engineering workers had an adverse effect on the profits our other industrial subsidiaries during a year in which trading conditions were generally difficult Capital expenditure by these companies amounted to 18.0 million in 1979 and the programmes to improve and increase productive capacity should show benefits in an increasingly competitive environment environment On the basis of the standard accounting practice for current cost accounting but without any adjustment for gearing and excluding interest it is estimated that the operating profits of the industrial subsidiaries would be approximately 9.0 million We earned satisfactory profits on our portfolio investment activities and we sold most of our shares in Harmony Gold Mining Company which together resulted in surplus on realizations of 5.8 million A substantial currency exchange profit arose during the year on foreign loans held to finance portfolio investments through the appreciation of sterling We received a full year's dividend from ANAMINT and the final dividend in respect of the previous year from AAC prior to the transfer of these holdings in terms of the restructuring and our income from investments at 18.4 million showed only a modest fall from last year's figure of 19.5 million As a counter to the drop in investment income which will be more marked next year when the full effect of the sale of investments will be felt our share of the retained profits of associates rose to 13.5 million before tax compared with a small loss last year Following the acquisition of our 28 per cent shareholding Johnson Matthey has become an associated company company Its results have been of outstanding and Charter's share its retained profits for the second half the year amounted to 5.9 million before tax In the current financial year a we will incorporate our share of full year's results of Johnson Matthey Also included in associated companies earnings is an amount of 5.4 of million in respect of MINORCO for the period until the enlargement its capital when our holding was reduced to 14.7 per cent and it ceased to an associated company Similarly an amount of 1.8 million has been included for AMCAN until it ceased to be associated company The taxation charge in relating to associated companies does not include relief respect of the loss of Cleveland Potash and is therefore disproportionately high at 8.6 million Our share of Cleveland's loss up to 30 September 1979 which amounted to 4.6 million has been included in the associated companies results As an integral part of the restructuring scheme AAC agreed to provide additional funds for the operation of the Cleveland Potash mine and Charter was of relieved of any further commitment in this respect Charter's liability in the event of closure of the mine was fixed at maximum 4.5 million being the proportion of the then estimated closure costs represented by our 37.5 per cent interest In view of the continuing losses being sustained at Cleveland a full provision has been made against funds provided during the year to meet operating losses and to discharge loans As a matter of of prudence a provision has also been made against the maximum liability in the event of closure After taxation relie 6.f8 million and with the current year's loss being taken in associated companies results there is a credit of 1.6 million to extraordinary items respect of Cleveland After taking credit for the profit on the sale of the balance of Union Corporation shares a long term investment the surplus from the restructuring and other miscellaneous items the total credit under extraordinary items amounts to 54.6 million Charter's restructuring during the year has led to reorganization of the company into four operating divisions each headed by an executive director Anthony Owston has returned from our office in Kuala Lumpur to direct the mining division and Geoffrey Higham chairman of Cape Industries has joined Charter as an executive director in charge of the industrial division Francis Howard is now the head of the finance division and John Richardson is in charge of the administration division which includes domestic and client services as well as the new business department These divisions emphasize the diverse nature of the company's business and reflect our policy that the profitability of each sector should be capable of of separate assessment The executive directors in charge the divisions and the managers responsible to them will be expected to set and attain profit targets for their areas of interest realistic of This is a significant change in the style in which Charter operates and such changes take time to implement However I hope that 1980 will begin to show the results of this approach and that an increased awareness profit rfeisnpaonncsiiablipleitryfowirlmlabnecereflected in : the company's growth and improved Charter intends to develop two fronts We have the financial to and resources highly skilled technical and administrative staff enable us to develop medium Investment scale mining projects in Europe and further afield in new mines carries with it high element of risk but in the case of particular minerals which are becoming increasingly scarce we believe that the potential reward more than justifies the accompanying level risk of ~ While However we are also diversifying more into industrial investment am confident that the areas in which Charter is presently involved offer for the future and the company will be seeking where possible to scope extend its interests in these sectors recognizing the difficulties that British industry faces in the shorter term I believe that an increasingly energy- conscious world will require a more significant use of rail and an increased supply of coal and the equipment used transportation in its May we acquired a large block of shares in Anderson StrathcleyxdteratcatkiionngIn our holding in that company to 28.4 per cent Anderson Strathclyde manufactures mining equipment including a range of coal shearers which are used in the longwall system of mining Shareholders will be aware of the approach by British Petroleum Selection Trust in which we have an interest of 25.7 to lead to an offer being made for the whole of per cent the share which may Trust No formal offer has yet been made If discussioncsapbietatlweoef nSetlheection companies result in an offer we will then advise shareholders of the board's view of the The financial restructuring and the subsequent internal have made considerable demands reorganization head office during the last year on our employees particularly those in am very pleased to have this opportunity to acknowledge their outstanding contribution and on behalf board to express to all our employees throughout the group my gratitude for their loyalty and dedication : London 24 June 1980 N. CLARKE chief executive Review of interests and operations The percentage figure after each company's name reflects Charter's interest in its equity capital INDUSTRIAL Cape Industries Limited 67.3 The group had a successful year considering the generally difficult trading conditions Group turnover amounted to 204 million compared with 180 million in 1978 and net profit before tax and extraordinary items was 12.5 million compared with 12.7 million last year As noted in last year's report Cape's South African asbestos mining companies were sold on 29 June 1979 to Transvaal Consolidated Land and Exploration Company Limited Accordingly tions despite disappointing results from the auto- motive and engineering division which reported trading profits of 1.2 million compared with 2,2 million last year The buildianndg insulation division had another excellent year with all its sections con- tributing higher sales and profits Trading profit for the division was 12.1 million compared with 8.7 million in However prospects for the current year in the construction and automotive markets are uncertain There are signs that the demand for insulation products will increase as the cost of energy continues to rise and Cape is well placed to benefit from this being the largest contractor in the country for insulation services to industrial and domestic markets However sales of Cape's more conventional building products and sales in the automotive divi- sion are expected to be affected by a general decline in industrial activity Heatrae Holdings Limited 100 The group manufactures a range of water and space heating products and catering equipment and reported sales of 17.6 million in 1979 compared with 15.0 million in 1978. Operating profit before interest and tax increased to 1.0 million from 0.7 million The group suffered from the road hauliers strike in the early months ofthe year and later the more damaging engineering workers strikes Without these performance for the year would have improved considerably Export effort continued with the 1978 export values being maintained despite the stronger pound and the relatively high cost of manufacture in A newpassenger facility at Gatwick airport lined with Monolux 40 resistant panels from a range of nonasbestos products developed by Cape Boards and Panels Limited This range ofproducts earned the company the 1980 Queen's Award for Technological Achievement the contribution of these companies to operating profit for the first six months plus the saving in interest charges for the rest of the year as a result of cash received at the time of the sale amounted to 2.6 million This compares with the contribution to operating profit of the asbestos mining companies of 4.2 million for the year 1978. The sale of these mines and the continuing process of substitution for products containing asbestos has resulted in less than 20 per cent of Cape's trading profit deriving from asbestos The reduction in profit arising from the sale of the mining companies was almost fully compensated for by the improved performance of the industrial opera- Final wiring of water heater for the Admiralty at the Heatrae Heating Limited factory in Norwich the United Kingdom Prospects for the group in 1980 are for consolidation of the 1979 position during a period in which the market is expected to reflect the generally depressed state of the economy MKR Holdings Limited 100 MKR Holdings which produces and markets a wide range of drink cooling and dispensing equipment had a disappointing year with sales of 19.6 million compared with 17.4 million in 1978 but operating profits before interest and tax were reduced to 1.9 million against 2.5 million Pour productivity in Gaskell & Chambers Limited led to a decline in sales despite a strong order position and resulted in trading profits less than half those of last year This together with a reduction in margins at M.K. Refrigeration Limited was mainly responsible for MKR's poor results overshadowing some improved performances in the smaller companies Steps have Operating profits at 2.1 million were marginally above the 1978 level of 1.9 million despite a small decrease in sales from 19.9 million to 19.2 million and would have been significantly higher if the strength of sterling had not eroded profits of the overseas subsidiaries Operations in the United Kingdom responded to a decline in demand by achieving significant increases in productivity which allowed profitability to be maintained The established overseas operations in Australia and Canada Quality controllers examining precision engineering components at the Orpington Kent factory of Paterex Limited part of the MKR MKR Holdings Limited group been taken to improve productivity and to restore margins and it is expected that 1980 will show significant improvement provided the spending plans of the brewery and distillery industries are maintained Pandrol International Limited 100" Pandrol International which was formerly Elastic Rail Spike Company manufactures and markets railway track fastenings and associated components Sir Charles Court Premieorf Western Australia right at the opening of the Pandrol International group's new factory at Maddington near Perth with Mr Bryan Clough managing director of Pandrol International Limited left and Mr Roy Colville former managing director of Pandrol Australia both performed well and improved upon 1978's results The first year of trading in Brazil proved to be profitable whilst the new operation in the United States had a more uncertain start Prospects for 1980 are for performance to be in line with that of 1979 Torque Tension Limited 100 The company produces hydraulic drilling equipment and strata support products and reported a decline in trading profits from 430,000 to 370.000 despite a significant increase in sales from 4.3 million to 5.4 million Profits were adversely affected by the planned increase in expenditure on research and development and on export marketing However this expenditure is expected to show returns during the current year and prospects for 1980 are for a recovery in profits although this will depend on the National Coal Board being able to maintain its forecast levels of capital expenditure MINING Malaysia Mining Corporation Berhad 28.6 Malaysia Mining Corporation MMC has substantial investments in some thirteen major tin producing companies operating principally in Malaysia but also in Thailand and Nigeria In addition MMC has a significant interest in the Ashton joint venture a diamond prospecting partnership operating in Western Australia MMC's tax profit for the year ended 31 January 1980 was 68.2 million a substantial improvement on the M352.9 million reported for the previous year This improvement was mainly due to the first full year of MMC's marketing operations which benefited from a very high tin price also to the disposal of some of MMC's investments The MMC group companies operating in Malaysia produced in 1979 a total of 19,550 tonnes of tin concentrates This represents a marginal decline of three per cent from the previous year's production of 20,210 tonnes and was largely due to the lower grade of the ground being mined Partially in response to this trend of declining production MMC is pursuing an active exploration programme to identify new tin and other mineral deposits in Malaysia Negotiations have continued during the past year regarding the tin deposit in the Kuala Langat region of Selangor state which is the largest undeveloped tin orebody in Malaysia These negotiations culminated in a series of agreements signed in June 1980 under which Charter's interest in the project has been assigned to MMC In terms of Charter's agreement with its partner in MMC Pernas Securities Sendirian Berhad it has always been understood that Charter's interest in the south Selangor project would eventually be assumed by MMC and it was judged that the implementation of the project would be facilitated this transfer took place at the present stage MMC will have 30 per cent investment in the joint venture and Tronoh Mines Berhad in which MMC has 29.9 per cent interest will hold five per cent Kumpulan Perangsang Selangor Berhad which is a subsidiary of the Selangor State Development Corporation will hold the remaining 65 per cent interest Charters indirect involvement in most Aerial view of a dredge of Berjuntai Tin Dredging Berhad part of the Malaysia Mining Corporation group interesting project will therefore be approximately nine per cent Towards the end of 1979 the Ashton joint venture announced the discovery of an alluvial diamond deposit together with an adjacent kimberlite pipe near Lake Argyle in the eastern part of the Kimberley region of Australia Prospecting work is currently being undertaken to determine the economic potential ofthis deposit MMC is proceeding with the preparatory work for constructing its own smelter although negotiations for securing an equity participation in one of the two existing smelters are continuing It is the intention that MMC should at an appropriate time seek a public quotation on the Kuala Lumpur and Singapore stock exchanges Beralt Tin and Wolfram Limited 50 Beralt Tin and Wolfram Beralt holds 80.55 per cent of Beralt Tin & Wolfram Portugal S.A.R.L. which owns and operates a wolfram tin and copper mine and plant at Panasqueira in central Portugal Beralt also has a 64.8 per cent indirect interest in Minas da Borralha S.A.R.L. which owns a wolfram mine and plant in northern Portugal Although wolfram prices in 1979 were generally lower than those in 1978 the year was satisfactory due to a rise in production and sales of concentrates At Panasqueira production of concentrates in 1979 amounted to 1,783 tonnes of wolfram 1,818 tonnes of copper and 88 tonnes of tin compared with 1,450 1,101 and 62 tonnes respectively produced in 1978. This improvement was largely due to the introduction of mechanized stoping and modifications to the treatment plant as well as a higher grade of mined ore Profit attributable to Beralt after taxation and minority interests was 2.4 million for the year 21.0p per share compared with 2.1 million 18.5p per share in 1978. The escudo continued to depreciate depreciate against the pound during the year and as result an exchange loss of 817,000 has been charged to the profit and loss account 1980 opened well for Beralt and provided production levels are maintained and the market remains reasonably stable the year's results should be satisfactory December 1979 AAC had provided 4.6 million on that basis Production in 1979 was 440.000 tonnes of potash which was 77 per cent higher than in 1978. In February 1980 after a review by the partners it was decided to continue operations at the mine In the first quarter of 1980 higher tonnages were hoisted but due to the necessity to carry out development in salt to far greater extent than envisaged the ore was diluted and output of potash consequently reduced This development has now been completed and the grade of ore and output have improved Although production levels in May and June showed ^ marked increase due to the higher mined grade costs have continued to escalate and the mine has not so far achieved an operating surplus Its future must depend on the consistent attainment of production targets Soci^'t^M'ini^red'Anglade 40 The company owns a small tungsten mine located in the Pyrenees which operated satisfactorily during the year However due to a decline in the tungsten price sales revenue fell by 8.6 per cent to FF35.0 million The company will pay a dividend of FF2.4 million in respect of the year to December 1979 compared with FF4.5 million in the previous year Cleveland Potash Limited 50 Charter and AAC acquired in October 1979 the 50 per cent interest of Imperial Chemical Industries Limited in Cleveland Potash for a nominal consideration and as result they now each hold 50 per cent ofthe equity All third party loans for which guarantees and other assurances had been given were paid off and Charter's share of this was 9.7 million AAC undertook to provide further funds for the mine which are recoverable with an annual return of 25 per cent as a first call on Cleveland's cash flow by 31 A view ofsome of the surface workings of the Soci^'t^M'ini^re d'Anglade mine in the French Pyrenees Exploration After allowing for sums recovered from partners and for grants received from the Department of Industry and the EEC expenditure on exploration amounted to 699,000 The decrease from last year was largely due to the termination of Charter's participation as result the restructuring in ventures in Australia and Brazil and the lower expenditure than planned on North Sea oil Programmes were maintained in Spain France and the United Kingdom with tungsten tin and uranium as the main targets A prospect near Segovia in Spain shows promise of a relatively small polymetallic orebody on which dril- ling and metallurgical testing is continuing Exploration work in the United Kingdom is hampered by the serious difficulties involved in identifying the owner- deposits ship of mineral and negotiating the right to explore In the North Sea Charter has an 8 per cent interest in a fifth round licence block where a well is planned in 1980 and it has taken a 10 per cent interest in a group which intends to apply for licences in the seventh round FINANCE AND INVESTMENT Anglo American Corporation Zimbabwe Rhodesia Limited 33.5 Anglo American Corporation Zimbabwe Rhodesia AMZIM reported profits of 3.0 million for the year ended 30 June 1979 compared with 3.3 million in the preceding year A dividend was declared for the year of5 cents per share to 48 per cent of profits 5 cents equivalent The major mining investments of AMZIM are in Wankie Colliery Company Limited Bindura Nickel Corporation Limited and Rhodall Limited Wankie Colliery supplies the entire internal market and exports coal and coke to neighbouring countries It is now plan- substanti- ning an expansion programme in order to supply fuel to a new thermal power station which will ally increase the country's power generation capacity Rhodall operates three chrome mines and a ferrochrome smelting plant AMZIM also has important investments in cane sugar production flour and maize milling and forestry and timber processing Botswana RST Limited 4.5 Botswana RST BRST has an interest of 85 per cent in BCL Limited which owns a copper mining operation at Phikwe in the Republic of Botswana Production in 1979 of copper matte was a record 39,823 tonnes and this combined with greatly increased metal prices resulted in an operat- ing profit of P15.8 million compared with P2.0 million in 1978. After deducting interest payable and adding exchange gains the loss on current operations was P16.5 million compared with a loss of P24.7 million in 1978. BCL's matte sales were restricted as a result of a labour dispute at the Amax Nickel Refining Company Inc. refinery as Amax Nickel Inc. declared force majeure to all its raw material suppliers with effect from 1 September 1979. The loss on current operations would have been reduced still further if normal sales had taken place in the last four months of the year The dispute has since ended and force majeure was lifted on 25 January 1980 Covenant Industries Limited 33.9 The company manufactures and formulates agricultural chemicals paints and commercial explosives and also imports and markets chemicals and related products It operates principally in Kenya Nigeria Tanzania and Zambia The consolidated profit before taxation and extraordinary items for the year ended 30 September 1979 was 2.9 million against 3.7 million in the previous year The fall in profit was caused principally by the difficult trading conditions in Nigeria and the reduction in the company's shareholding in Chemical and Allied Products Limited to 40 per cent compared with 60 per cent in the previous year In spite of generally difficult trading conditions Dukon Limited which manufactures paints in Zambia increased its profits Hudson Bay Mining and Smelting Co. Limited Hudson Bay Mining and Smelting Co. Hudbay is held as to 44.8 per cent by AMCAN in which Charter has a 10.7 per cent interest It is diversified natural resources company being a major producer of copper and zinc in North America le fay Hudbay's earnings after tax for the year ended 31 December 1979 rose from 5.1 million to 50.8 million and the company paid dividends of 80 cents per share in 1979 whereas no dividend payments had been made in the previous year Earnings per share at 3.05 per share were a substantial improvement on those of 50 cents per share in 1978. The Canadian metals division had a much better year in 1979 with contributions to net earnings of 27.9 million compared with only 5.0 million the previous year which was largely due to firmer metal prices Inspiration Consolidated Copper Company owned 50 per cent by Hudbay and 50 per cent by MINORCO earned US million compared with a loss of US million in 1978. This was largely due to higher selling prices of copper up from 64.9 cents per pound in 1978 to 89.2 cents per pound in 1979. Hudbay's petroleum subsidiaries Canadian Merrill Ltd and Francana Oil & Gas Ltd reported improved earnings as a result of higher oil and gas prices as well as higher gas production in Canada Earnings of Terra Chemicals International Inc. increased to US million from US million the year before which represents a substantial improvement over last year and a reversal of year trend of declining earnings During the year Hudbay acquired a 9.8 per cent holding in Rosario Resources Corporation of New York for around 24 million and made a tender offer for the company As a result of a counter this stake was sold to Amax Inc. at profit of nearly 20 million Johnson Matthey & Co. Limited 28.1 The company and its subsidiaries form a British based metals refining and industrial group with world interests in trading in precious metals metals refining chemicals mechanical products colours and transfers and banking The group reported excellent results for the year to 31 March 1980 with profits before taxation of 38.6 million 79 per higher than the figure 21.6 million for the previous year Earnings per share amounted to 48.0p 1979 -26.1p and dividends of 15p per share were leclared for the year 1979 8.5p The higher activity in world precious metal markets led to greater opportunities for the group's metal trading and bullion banking operations Group sales excluding those of Johnson Matthey Bankers Limited were 866 million for the year compared with 561 million in 1979 reflecting the growth of the group's industrial interests and also the rise in precious metal prices Increased working capital requirements due to high prices of raw materials together with high interest rates in the United Kingdom led to an increase in interest charges from 4.6 million in 1979 to 9.3 million in 1980 In October 1979 Johnson Matthey Chemicals Limited completed an improved and extended metals refinery at Brimsdown at a cost million which is now one of the largest and most modern precious metals refineries in the world The group's prospects for 1980/81 are difficult to forecast but following the significant capital investment made in recent years growth is expected to be maintained and even better results than those of the record year just ended should be achieved in the years ahead Minerals and Resources Corporation Limited 14.7 MINORCO is a holding company based in Bermuda whose purpose is to invest in mining and industrial projects throughout the world Net income before group share of retained net earnings of associates was 15.1 million marginally less than the previous year The decision was taken however to equity account for the first time for the earnings of MINORCO's associates which brought profits before extraordinary items to 35.5 million Due to difficulties in remitting funds from Zambia the profit of Zamanglo Industrial Corporation Limited was no longer consolidated which led to fall in group income of US million Engelhard Minerals & Chemicals Corporation EMC in which MINORCO has an interest of 28.4 per cent made profits after tax in 1978 of 142.2 million compared with 122.6 million in 1977 and dividends paid to MINORCO amounted to more than two thirds of the group's investment income MINORCO has an interest of just over 43 per cent in Trend International Limited an oil and gas company operating principally in Indonesia and North America MINORCO holds 49.9 per cent of Zambia Copper Investments Limited ZCI which in turn has an interest of just under 40 per cent in Nchanga Consolidated Copper Mines Limited and 9.8 per cent in Roan Consolidated Mines Limited MINORCO also holds 50 per cent of the equity capital of Inspiration Consolidated Copper Company In terms of the restructuring of Charter MINORCO received in December 1979 50 per cent of the share capital of AMCAN and a 10 per cent interest in ANAMINT MINORCO and ZCI were also relieved of their obligations to the BRST project and ZCI lent the funds to repay the balance of its loan from MINORCO In consideration for these assets 26.2 million new MINORCO shares were issued to Charter shareholders and a payment was made of net sum of 19.5 million MINORCO expects these investments coupled with further growth by EMC significantly to increase its profits during the coming year The directors of MINORCO have stated that in the absence of unforeseen circumstances they intend to recommend a final dividend for the year to 30 June 1980 of 15 cents per share on the enlarged share capital The Rio Tinto Corporation Limited 4.3 The Rio Tinto Corporation RTZ and its subsidiaries comprise a group of companies with interests in almost every major metal and fuel Profit after tax for the year to 31 December 1979 was 149.8 million compared with 102.3 million in 1978. Earnings per share rose from 40.6p to 59.4p in 1979. This increase 46 46 per cent in attributable net profits was mainly the result of higher metal prices and was achieved in spite of the reduction in the sterling value of overseas profits caused by the relative strength of the pound sterling During 1979 Conzine Riotinto of Australia Limited CRA had a fifteen rights issue This together with other issues by CRA in connection with acquisitions had the effect of reducing RTZ's beneficial interest in this company to 65.5 per cent Notwithstanding this reduction the contribution to RTZ's net attributable profit from CRA in 1979 was about 40 per cent higher than in 1978 largely as a result of higher metal prices and a greater volume of sales RTZ has a beneficial interest of 51.3 per cent in Rio Algom Limited a Canadian company with invest- ments in molybdenum uranium mining and in stainless and specialty steels Results in 1979 were adversely affected by the decision of the Tennessee Valley Authority not to take contracted deliveries of uranium oxide and by industrial action at one of its steel mills However this was more than offset by higher profits from Lornex Mining Corporation Ltd which is 68.1 per cent owned by Rio Algom RTZ Borax a wholly owned group of companies reported net profits similar to those of 1978 from its borax and chemicals operations although its contribution to RTZ's net profits was reduced from 36.9 per cent to 26.3 per cent R.T.Z. Oil and Gas Limited earned a significantly higher profit from its 25 per cent interest in the Argyll field in the North Sea as result of higher oil prices and increased production from two further wells brought on stream in 1979 Selection Trust Limited 25.7 portfolio Selection Trust is a British based mining finance with interests in the production and use of group minerals and a significant investment Profit for the year to 31 December 1979 after taxation and minority interests was 13.7 million com- pared with 11.4 million in 1978 and earnings per share rose from 35.8p to 43.0p over the year tax profits were 33 per cent higher than in 1978 but a higher effective tax rate reduced the increase in net profits to 20 per cent In August 1979 the group's Australian interests were integrated into Seltrust Holdings Limited a new public subsidiary in which the parent holds a 78.8 per cent interest The Agnew nickel mine in Western Australia began commercial operations in July and production of nickel matte will be increased from its present level of 10,000 tonnes per annum to 15,000 tonnes per annum over the next five years Selection Trust has a beneficial interest of 3.9 per cent in the Mt Newman iron ore venture which partly due to lower output and sales made a reduced contribution to operating profits of 2.2 million in 1979 compared with 3.6 million in 1978 The group is expanding its interests in the United States through wholly owned Amselco Holdings Limited which has 50 per cent interest in the Alligator Ridge gold prospect in Nevada where development is in progress In the United Kingdom the coal and civil engineering operations of the Alexander Shand group raised their contribution to operating profit from 5.3 million to 6.5 million although the Kleeman Industrial Holdings group which was recently acquired had a disappointing year with profits halved at 0.7 million on unchanged , turnover Income from the 13 gas field in the North Sea through Selection Trust's participation in the Noordwinning group rose from 2.7 million to 4.6 million Dividends and associated company income rose from 5.6 million in 1978 to 8.0 million The group has an important interest in Amax which had another record year with net earnings more than doubled to 365 million Tara Exploration and Development Company Limited 14.1 The company's 75 per cent owned subsidiary Tara Mines Limited owns and operates the largest zinc lead mine in Europe at Navan in the Irish Republic In 1979 1.6 million tonnes of ore were milled pro- a ducing 294,000 tonnes of zinc concentrates and 55,000 tonnes of lead concentrates Tara Exploration made a profit after tax and extraordinary items of US million in 1979 compared with loss in 1978 of 10.7 million In October 1979 a prepayment of financing US million was made on the main bank The first instalment of principal repayment falls due in July 1980 Report of the directors The directors have pleasure in submitting their fifteenth for annual report with the audited accounts the year ended 31 March 1980. The group's operations during the year have been dealt with in the review of interests and operations on pages 9 to 15 Financial results The following are the major features of the consoli- dated profit and loss account Consolidated profit before taxation Deduct Taxation Interest of outside shareholders 1980 000 52,349 20,752 3,659 1979 000 44,547 17,965 Earnings attributable Dividends Interim of 3p per share paid on January 1980 Special of 0.35p per share paid on 3 January 1980 Recommended final of 5p per share payable on or about 9 August 1980 on director on 16 October 1979. Mr H. J. Stucke resigned as director 17 June 1980 executive Mr J. N. Clarke was appointed managing director on 16 October 1979 in place of Mr M. B. Hofmeyr who continued as chairman until 1 April 1980 and remains a director On 1 April 1980 Dr A. Spinks was appointed executive chairman of the board and Mr Clarke its chief In accordance with the company's articles of asso- ciation Dr A. Spinks holds office only until the forthcoming annual general meeting but offers himself for reappointment Mr M. B. Mr G. W. Relly and Mr P. D. Hofmeyr Burnell rotation and offer themselves for reappointmreentitre by The directors fees have remained unchanged at 2,000 per annum since 1965. To alleviate the fall in real value and permit greater flexibility in future shareholders will be asked at the forthcoming annual general meeting to amend the company's articles of association to increase the remuneration to 4,000 per annum and give the board discretion to make further increases up to a maximum of 6,000 per annum Restructuring of the group On 14 November 1979 shareholders and loan stock holders approved proposals for the the restructuring of group including a scheme of arrangement under section 206 of the Companies Act 1948. These posals have been implemented pro- Profit for the year retained Extraordinary items Transfer to reserves Earnings per share after taxation and prior to extraordinary items were 26.63p compared with 21.93p in the year to 31 March 1979. As foreshadowed in the scheme of arrangement document of 22 October 1979 the board has recommended a final dividend of 5p per share to make a total dividend for the year of 8.35p per share carrying a tax credit of 3.57857p per share Directorate A list of the directors of the page 3 company appears on a Mr H. R. Fraser resigned from the board on 4 1979. Mr R. H. Dent retired at the July company's annual general meeting on 10 August 1979 and Mr G. A. Higham was appointed director in his place Mr L. G. Stopford Sackville Mr W. D. Wilson and Mr G. A. Carey resigned from the board on 10 August 1979 10 October 1979 and 12 October 1979 res- pectively Dr A. Spinks CBE FRS was appointed a a by the disposal to Anglo American Corporation of South Africa Limited AAC or De Beers Consolidated Mines Limited De Beers of the Charter group's investments in AAC Rustenburg Platinum Holdings Limited Anglo American Corporation do Brasil Limitada and Australian Anglo American Limited together with a port- folio of investments representing the majority of its other investments in southern Africa other than Zimbabwe of b by the acquisition the interests of AAC and De Beers in Johnson Matthey & Co. Limited Tara Exploration and Development Company Limited and Soci^'t^M'ini^red'Anglade and c by the disposal to Minerals and Resources Corporation Limited MINORCO of the whole of the Charter group's investment in Anglo American Investment Trust Limited and part of its interest in Anglo American Corporation of Canada Limited amcan together with a cash to MINORCO the consideration being the piasysumeenbty MINORCO of new ordinary shares to Charter shareholders in the ratio of one new MINORCO share for every four Charter fully paid shares held The transactions under c above were effected by scheme of arrangement dated 22 October 1979 which 16 was approved by the High Court of Justice on 3 December 1979 and became effective on 4 December 1979. The scheme involved a reduction in the share capital of the company and details of this and other changes in Charter's share capital and reserves during the year are given below and in notes 15 to 18 on the accounts on pages 33 and 34. The surplus on disposal of investments after deduction of scheme expenses and taxation totalled 54 million and is dealt with in the accounts as an extraordinary item see note 8 on page 29 the proceeds from the disposal and acquisition of investments amounted to 31 million see note 20 on page 35 As part of the restructuring Charter and AAC acquired on 16 October 1979 for a nominal consideration the 50 per cent interest of Imperial Chemical Industries Limited in Cleveland Potash Limited Cleveland and Charter and AAC are now equal partners in the project Following approval of the restructuring proposals on 14 November 1979 AAC will provide any further funds required by the Cleveland mine and in the event of closure or suspension of operations Charter's funding obli- gations will be limited to a of maximum 4.5 million The new funds provided by AAC will have first call on Cleveland's cash flow Accordingly Charter ceased to account for its share of Cleveland's losses after the nine months to 30 September 1979 Following the reduction in the company's percentage interest AMCAN and MINORCO ceased to be associated companies of Charter and its share of their retained profits less losses has been accounted for only for the nine months to 30 September 1979. As a result of the company's new interest in Johnson Matthey & Co. Limited that company became an associated company and Charter has accordingly accounted for its share of the profits from 1 October 1979 The principal interests of the company after the restructuring are shown on pages 36 and 37 Share capital and reserves In September 1979 the company issued 268 fully paid shares of 25p each against conversion of 1,113 five per cent convertible unsecured loan stock 1984 Between 1 April 1979 and 13 November 1979 the record date for the scheme of arrangement 6.900 partly paid shares issued under the company's share incentive scheme became fully paid At that date the authorized share capital of the company was 30,000,000 in 120,000,000 shares of 25p each and there were in issue 104,854,470 fully paid shares and 270,100 partly paid shares 1p paid up a total of 105,124,570 shares On 4 December 1979 the effective date of the scheme special resolutions approved by shareholders at the extraordinary general meeting of the company on 14 November 1979 reduced the nominal value of the 105,124,570 shares in issue to 2p each by cancellation of 23p of the capital paid up on each fully paid share and 23p of the uncalled capital on each partly paid share the sum of 24,116,528.10 arising being carried to a separate reduction reserve Thereupon every two of the unissued shares of 25p each were consolidated into one share of 50p and every such share of 50p was subdivided into 25 shares of 2p each and the authorized share capital was increased to 45,500,000 in 2,275,000,000 shares of 2p each After transferring 10,000 from share premium account to a separate reserve called the incentive reserve the aggregate of the reduction reserve of 24,116,528.10 referred to above and the amount of 18,701,759.38 standing to the credit of share premium account was applied in paying up in full at par 2,140,914,374 shares of 2p each designated as A shares These were allotted to the holders of fully paid shares pro rata to their existing shareholdings and were thereafter renounced in favour of MINORCO in exchange for the new MINORCO shares issued to Charter shareholders On 5 December 1979 the capital of the company was further reduced by the cancellation of the A shares and the assets they represented were transferred to MINORCO Thereafter the authorized share capital was and remains 2.681,712.52 in 134,085,626 shares of 2p each and the issued share capital was 2,099,790.40 in 104,854,470 fully paid shares of 2p each and 270,100 partly paid shares of 2p each 1p paid up Also on 5 December 1979 as provided in the scheme the company's five per cent convertible unsecured loan stock 1984 was repaid at par with accrued interest to that date In terms of the scheme 2,378.96 of the sum standing to the credit of the incentive reserve was applied by way ofcapitalization to the allotment allotment on 13 December 1979 of 118,948 fully paid shares of 2p each in the ratio determined by the market prices of the Charter and MINORCO shares after the scheme became effective of 1.762282 new shares for every four partly paid shares held These shares are subject to the same restrictions as the partly paid shares to which they relate until such time as those partly paid shares become fully paid The balance of the incentive reserve of 7,621.04 reverted to share premium account Between 13 December 1979 and 31 March 1980 52,650 partly paid shares became fully paid and in consequence 23,184 fully paid shares subject to restricted rights became free of restriction The issued share capital at 31 March 1980 is shown in note 15 on the accounts on page 33. Since the end of the year a further 7,750 partly paid shares have become fully paid and 3,413 fully paid shares subject to restricted rights have become free of restriction The issued share capital accordingly stands at 2,102,773.36 in 104,941,467 fully paid shares of 2p each 209,700 partly paid shares of 2p each 1p paid up and 92,351 fully paid shares of 2p each subject to restricted rights Movements on reserves are shown in the consolidated profit and loss account on page 22 At the forthcoming annual general meeting share- holders will be asked to approve an increase in the authorized share capital to round it up from 2,681,712.52 to 2,700,000 divided into 135,000,000 shares of 2p each This will bring the number of unissued shares to 29,756,482 which represents 22.0 per cent of the enlarged share capital No issue of shares will be made which would effectively alter the control of the company without prior approval of the company in general meeting information The book value of the group's fixed assets decreased from 74,905,000 to 68,336,000 during the year Details are shown in note 10 on the accounts on page 30. The directors are of the opinion that the market values of the group's land and buildings at 31 March 1980 were in excess of the net book amounts shown in the consolidated balance sheet but as the assets are required for the group's operations no professional valuations have been carried out during the year An analysis of assets and income appears on page 38 a and list of major subsidiary companies on pages 40 and 41. Other particulars which constitute part of this report are on page 42 by order of the board D. BOOTH 40 Holborn Viaduct London EC1P secretary 24 June 1980 Accounts Charter Consolidated Limited and its subsidiary companies Report of the auditors to the members We report on the accounts set out on pages 20 to 37 and 40 and 41 which have been prepared on the basis of the accounting policies set out on pages 20 and 21 In our opinion the accounts give a true and fair view of the state of affairs of the company and of the group at 31 March 1980 and of the profit and source and application of funds for the year ended on that date and comply with the Companies Acts 1948 and 1967 : COOPERS & LYBRAND DELOITTE HASKINS & SELLS Chartered Accountants London 7 July 1980 Accounting policies 1. Basis of consolidation i The accounts are prepared on the historical cost basis of accounting except for certain assets included at revaluation ii In order to facilitate administration the financial years of Cape Industries Limited and terminate its subsidiaries and those of the other group industrial subsidiaries December Details of these subsidiaries are shown on pages 40 and 41 on 31 iii The results of subsidiaries acquired or disposed of during the year are included in the consolidated profit and loss account from their effective dates of acquisition or disposal The premium or discount between the purchase considerations and net assets is dealt with | through reserveswhile differences between sale considerations and book values of net assets at the dates of disposal are shown as an extraordinaryitem 2. Foreign currencies ) Profit and loss items assets and liabilities are translated into sterling at the rates of exchange ruling at the dates of the respective balance sheets ii Differences arising from the translation into sterling of foreign currency loans financing foreign portfolio investments are included with the sterling profits less losses arising on the realization of those investments In accordance with policy 4 these differences the profits less losses arising from the realizations of foreign portfolio investments are included in the profit and loss account as surplus on realizations of investments iii Differences arising from the translation into sterling of all other foreign currency items are shown as an extraordinary item in the profit and loss account 3. Income received Income from investments including where applicable the imputed tax credit is accounted for on a received basis . 4. Investments ) Investments have been classified into portfolio and long term holdings Investments are deemed to be long term when they are considered to be of strategic importance to the group and are not held with the intention of resale If due to changed circumstances long term investments cease to be of strategic importance they are reclassified as portfolio investments ii Profits less losses arising on disposal of portfolio investments are included in the profit and loss account as surplus on realizations of investments Any profits and losses arising from the disposal of long term investments are dealt with as an extraordinary item in the profit and loss account iii Investments are included at cost unless the aggregate of market value and directors valuation is less than book value or when in the opinion of the directors a permanent loss in value has arisen on any investment The loss in value oflong term investments is charged as an extraordinary item in the profit and loss account 5. Turnover Turnover is the invoiced value of sales and services of industrial subsidiaries and excludes both transactions between group companies and sales turnover taxes 6. Capital expenditure grants Grants in respect of capital expenditure are credited to profit and loss account over the estimated average life of the relevant fixed assets Grants shown in the consolidated balance sheet represent total grants to date less the amount credited to profit and loss account 7. Depreciation Fixed assets are written off evenly over their expected useful lives with the exception that no depreciation has been provided on freehold land t The following rates are normally applied Freehold buildings 2 per cent per annum Leasehold property - the period of the lease or 2 per cent per annum for leases in excess of 50 years Plant furniture and fittings - 10 to 25 per cent per annum _ Depreciation on assets qualifying for capital expenditure grants is calculated on their full cost see policy 6 8. Technical development expenditure Group expenditure on research and development patents and trade marks is written off when incurred 9. Deferred taxation : Provision is made for deferred taxation at the rate of corporation tax ruling at the year end except in respect of any tax reduction which is reasonably expected to continue for the : foreseeable future Debit balances are carried forward in the balance sheet where there is a reasonable certainty of recovery in the near future Advance corporation tax on dividends payable after the balance sheet date is included with deferred taxation 10. Stocks and work in progress payments Stocks and work in progress are valued at the lower of cost and net realizable value Contract work in progress is valued at cost less foreseeable losses and received and receivable Cost includes expenditure which is incurred in thperongorremsasl course of business in bringing the product or service to its present location and condition Net realizable value is the estimated selling price less all costs to be incurred 11. Prospecting exploration and development expenditure Group expenditure on prospecting and on exploration and development is dealt with as follows ) Expenditure to develop existing mining areas : This expenditure being part of the general development of the mine is written off to mine operating costs in the year incurred and is reflected in operating profit in the profit and loss account ii Expenditure on general prospecting in Expenditure during the initial stages of exploration is written off full in the profit and loss account of the year Further expenditure on prospects showing potential of being developed into a mine is carried forward as an asset in the consolidated balance sheet under the heading of exploration and development expenditure while an evaluation is carried out to establish its commercial viability In the event that any prospect is abandoned after such evaluation the total expenditure is charged as an extraordinary item in the profit and loss account iii Expenditure on development of new mines profit When it is decided to develop a prospect into a mine any exploration and development expenditure relating thereto is capitalized as an investment or fixed asset All further expenditure on development of the mine is capitalized If any project has to be abandoned in the development stage the total expenditure is charged as an extraordinary item in the and loss account : 12. Associated companies The group accounts for profits less losses of associated companies as defined under statement standard accounting practice no 1 as follows i Dividends from associated companies are accounted for on a received basis and this income is included in income from investments in the profit and loss account ii In addition the group share of retained profits less losses for the year is accounted for separately in the profit and loss account The accounts used to calculate the group share of retained profits less losses of associated companies are normally the latest audited available to the group accounts iii The group share of retained profits less losses of associated companies since 1 April 1971 or the date when they were first treated as associated companies is included in the book values of the investments in the consolidated balance sheet It is not practicable to ascertain the group share of retained profits prior to these dates Mine development costs of companies in the course of developing mines including costs charged to revenue by those companies are not accounted for in the profit and loss account in accordance with policy 11 iii Consolidated profit and loss account Year ended 31 March 1980 Charter Consolidated Limited and its subsidiary companies Revenue Operating profit of industrial subsidiaries note 1 Income from investments note 2 : Share of retained profits less losses of associated companies note 4 Surplus on realizations of investments Interest receivable Expenditure Administration and technical note ) Prospecting Interest payable note 3 Profit before taxation . : Taxation note 6 ; Profit after taxation before extraordinary items Deduct Interest of outside shareholders in profits of subsidiaries Profit attributable to Charter Earnings per share 26.63p 1979-21.93p 1979-21.93p 1979-21.93p note Dividends paid and proposed note 9 ; Add Extraordinary items 1979 -- deduct note 8 , Retained profit transferred to reserves Profit for the year after extraordinary items totalled 82,489,000 1979 17,309,000 1980 000 19,790 18,422 13,463 5,758 6,206 63,639 3,601 699 6,990 11,290 52,349 20,752 31,597 3,659 27,938 8,760 19,178 54,551 73,729 Movements on reserves ; Reserves at 31 March 1979 Retained profit for the year a Reduction in reserves as a result of the scheme of arrangemenontte 18 Elimination of associated company reserves on their ceasing to be associated companies Premium 1979 discount on purchase of shares of subsidiary companies Surplus on revaluation of subsidiary's freehold property 159,810 73,729 10,528 12,035 334 _ Reserves at 31 March 1980 note 17 210,642 1979 000 20,887 19,517 56 11,990 4,059 56,397 : 3,771 1,079 7,000 11,850 44,547 17,965 26,582 3,591 22,991 9,043 13,948 5,682 8,266 150,467 8,266 _ _ 94 983 159,810 The accounting policies on pages 20 and 21 and the notes on pages 26 to 35 form part of these accounts Consolidated balance sheet 31 March 1980 Charter Consolidated Limited and its subsidiary companies Fixed assets note 10 Exploration and development expenditure Investments note 11 Market or directors valuation 242,175,000 1979- 1979- 282,239,000 Current assets Stocks and work in progress note 12 Debtors Short term loans and deposits *: Bank and cash balances Current liabilities Associated companies and other deposit accounts Bank loans and overdrafts secured - 503,000 1979 1,358,000 Unsecured 6 per cent DM bonds repaid 1 April 1980 Creditors note 13 Taxation Proposed final dividend Net current assets Deferred taxation note 6 Financed by Share capital note 15 Share premium account note 16 Reserves note 17 Total capital and reserves Capital expenditure grants Interest of outside shareholders in subsidiaries Long term indebtedness note 14 1980 000 000 68,336 113 142,711 1979 000 000 74,905 122 158,306 53,824 69,514 67,324 2,581 193,243 51,804 59,565 48,550 1,890 161,809 11,726 9,605 | 19,002 71,325 21,212 5,247 5.938 _ 24,301 67,356 5,863 5,871 138,117 109,329 55,126 7,418 52,480 10,880 273,704 296,693 2,103 12,064 210,642 224,809 2,825 22,944 23,126 273,704 26,215 30,695 159,810 216,720 2,560 20,736 56,677 296,693 N. CLARKE } B. W. PAIN Directors The accounting policies on pages 20 and 21 and the notes on pages 26 35 35 form part of these accounts Balance sheet 31 March 1980 Charter Consolidated Limited Subsidiary companies _ Shares at cost or valuation . : Add |. Amounts due from subsidiaries Deduct . Amounts duteo subsidiaries ; . ; Current assets . " Bank balances Deferred asset : Advance corporation tax note 6 Me Financed by Share capital note 15 Share premium account note 16 Reserves note 17 Total capital and reserves Long term indebtedness note 14 Current liabilities Creditors Taxation a Proposed final divide ==. 1980 000 000 1979 000 000 93,779 ; . 63 93,779 ' : ae 93,779 : aan on : 37,265 . _ ca 56,514 a an 2,516 2 - ~~ 59,032 _ 82 - 26,215 18,702 4,626 . 49,543 2,337 ~ 6,420 11,025 7,152 59,032 N. CLARKE B. W. PAIN ; Directors ~ The accounting policies on pages 20 and 21 and the notes on pages 26 to 35 form part these accounts . 24 funds Sourceand applicationapplication of _ Year ended 31 March 1980 : Charter Consolidated Limited and its subsidiary companies SOURCE OF FUNDS Profit before taxation Extraordinary items As result of restructuring of the group and before taxation of 24,192,000 of Other items before interest outside shareholders and _ adjusted for taxation relief of 9,450,000 1979 - 16,162,000 - - Adjustments for items not involving movements of funds Depreciation ; Provisions against mining projects and investments loans Effect of currency translation on fixed assets investments and Share of retained profits less losses of associated companies Funds generated Disposal of fixed assets ot in Increase government grants Byte . . APPLICATION OF FUNDS Purchase of fixed assets Transfer ofinvestments and cash as part of the scheme of arrangement note 20 Investments note 20 iv - Goodwill on acquisition of subsidiaries Taxation paid in Decrease in long term indebtedness SS aeUnsecured 6 per cert DM loan bonds note 20 iii Other Increase in working note v capital and other items oy Dividends paid Increase in liquid funds in Increase short term loans deposits and cash Increase in associated companiesand other deposit accounts Decreasein bank loans and overdrafts 1980 000 000 52,349 1979 000 000 44,547 78,421 9,420 121,350 & 481 _ 8,678 - : 5,632 126,982 15,836 265 16,101 143,083 37,163 59,469 a 520 59,989 on 1 18,492 18,650 114,711 28,372 43,878 16,111 16,111 The accounting policies on pages 20 and 21 and the notes on pages 26 to 35 form part of these accounts Notes on the source and application offunds are in not2e0 on page 35 Notes on the accounts 1. Operating profit of industrial subsidiaries and administration and technical expenditure i Turnover of the industrial subsidiaries ii Expenses charged Auditors remuneration Directors emoluments see note 5 Depreciation of fixed assets see note 10 Hire of plant and equipment of Charge in respect of depreciation of assets held under finance leases Credits Capital expenditure grants Rents receivable iii Administration and technical expenditure 7 Expenditure Deduct Recovered from companies outside the group 1980 000 266,379 : 474 328 : 8,073 1,250 231 1979 : 000 238,446 418 205 7,248 ' 1,043 125 2. from investments i Associated companies Other investments 1980 1979 L 000 000 3,840 14,582 3,778 15,739 ii Arising from Listed investments Unlisted investments m i - iii Includes franked investmiencnomte 18,422 15,710 2,712 2,712 18,422 6,202 19,517 % 16,444 3,073 _ _ 19,517 4,758 NOTE Income from investments does not include dividends paid by Anglo American Corporation Zimbabwe Rhodesia Limited which are held in Zimbabwe awaiting approval for remittance abroad At current rates of exchange the divide^-a 31 to paid in the year ended March 1980 was equal 330,000 335,000 and the total of such dividends held in Zimbabwe 31 March 1980 was 904,000 31 1,220,000 1979 3. Interest payable on borrowings by the group Loans repayable after more than five years Loans repayable within five years Amounts deposited with the group Bank loans and overdrafts 4. Associated companies Principal associated companies are listed on pages 36 and 37 Group share ofretained profits less losses of associated companies Share of profits less losses before taxation Deduct Dividends declared from these profits 17,718 4,255 2,673 2,729 Group share retained profits less losses before taxation Taxation Extraordinary items see note 8 Group share of retained profits less losses for the year Group share of retained profits less losses at 31 March 1979 13,463 8,627 4,836 1,717 3,119 : 10,091 56 3,666 3.722 1.239 4,961 a Retained profits relating to investments which ceased to be associated companies On disposal of investments dealt with in extraordinary items On dilution dealt with directly through reserves 13,210 3,056 12,035 Group share of losses less retained profits at 31 March 1980 see notes 11 and 17 1,881 NOTES _ ) Associated companies deferred taxation has not been adjusted to reflect the group's account- ing policy because of different taxation systems and accounting standards applicable to certain as ociated overseas associated ii Minerals and Resources Corporation Limited MINORCO which was an associated company of Charter to 30 September 1979 has for the first time in its accounting year to 30 June 1979 accounted for its own associated companies profits Charter's profit after taxation for the year to 31 March 1980 includes 2.7 million in respect of such profits to 30 September 1979 5. Directors emoluments Directors of the parent company Fees Salaries and other remuneration including pension contributions Ex gratia payment to a former director Pension contribution for a former director Pension payable to widow of former director -Deduct Fees received from other companies and refunded to the group Amounts paid to directors Chairman Mr M. B. Hofmeyr Others 30,001 25,00120,00115,00110,001- 5,001up to 5,000 NOTE 13 directors have agreed to waive emoluments due to them from Charter Consolidated Limited and its subsidiary companies Fees waived by these directors during the year amounted to 23,000 1979 13 directors - 26,000 6. Taxation 1 Charge in consolidated profit and loss account GROUP COMPANIES on profit for the year United Kingdom Corporation tax 52 cent Deferred taxation * ~ Double taxation relief Advance corporation tax written off by subsidiary subsidiary Taxation at 30 per cent 1979-33 per cent on franked investment income : Overseas Taxation Deferred taxation : ; 4.038 918 Adjustments in respect of previous years ASSOCIATED COMPANIES see note 4 12,802 677 8,627 15.061 762 3.666 20,752 17,965 NOTE The taxation charge for the year excludes 6,318,000 1979 5,400,000 not expected to be payable in the foreseeable future resulting from accelerated capital allowances stock apprecia- tion relief and other timing differences 2 The provision made accounts for deferred taxation and the full potential liability are set out below 1980 : FULL PROVISION POTENTIAL MADE LIABILITY : : qualify- Excess of the book value of assets ing for taxation allowances over their written down value for taxation purposes Taxation on capital gains on property revaluation Taxation on capital gains on assets sold and rolled over against the acquisition of new assets Taxation relief relating to provision for compensation for industrial disease Stock appreciation relief relating to certain industrial subsidiaries Taxation relief on prospecting expenditure not yet claimed Difference between book and taxation value of investments Advance corporation tax 000 . 000 141 14,564 22 2,150 ~ 192 44 4,341 1,125 910 9,801 152 18,844 see note iii below 3,388 7,095 1979 PROVISION MADE 000 FULL POTENTIAL LIABILITY 000 3,712 : 32 14.059 2,184 1,183 111 237 11,982 2.516 1,196 10,561 : 497 14.001 5,213 NOTES 8 i Potential deferred taxation see note includes relief based on 15,290,000 being the balance of the provision against the invest- ment in Cleveland Potash Limited not yet account claimed for taxation purposes No has been taken in potential or deferred taxation on for relief other provisions of 5.931,000 see note 13 iii ii The amount of 4,341,000 included in respect of the difference between book and taxation values of investments relates mainly to the profits arising on certain group transactions eliminated on consolidation which is 7,418 639 10.880 7,080 deferred until such time as the profits are realized outside the group s iii Advance corporation tax recoverable includes 2,249,000 1979 - 2,516,000 shown as deferred asset in the parent company's balance sheet iv The potential liability for stock appreciation relief has been reduced by 2,930,000 1979 - nil written off in accordance with the pro- visio ofnts he Finance No. 2 Act 1979 7. Earnings per share attributable Earnings per share attributable to Charter is calculated on earnings of 27,938,000 1979 - 22,991,000 and on 10,930,304 shares 1979 104,847,302 shares as if the additional 268 shares issued in September 1979 against conversion of loan stock had been issued for the whole financial year as if the 59,550 partly paid shares which became fully paid during the financial year had been fully paid for the whole year and as if the 23,184 shares subject to restricted rights which ceased to be restricted during the financial year had been issued and free of restriction for the whole year 8. Extraordinary items Surplus on disposal of investments less scheme expenses following the restructuring of the Charter group net of taxation of 24,192,000 Cleveland Potash Limited see note ) below Soci^'t^M'ini^rede Fungurume SMTF taxation relief on amounts written ofifn prior years Profit on disposal of long term investments net of taxation of 1,265,000 Net effect of translation of currencies Industrial disease provision Discount on purchase of 6 per cent unsecured DM bonds and 7 per cent guaranteed FF bonds Botswana RST Limited Limited investment provision - Losses and provisions relating to closure of operations 1979 net recovery Surplus on disposal of Cape Industries Limited's mining division : Sundry Associated companies see note ii below Minority interest ; 251 539 294 11 50 1,717 54,259 292 54,551 _ 20,189 12,581 . 5,984 3,272 445 Oa 442 137 : 47 _ 149 1,239 6,079 397 5.682 NOTES i Cleveland Potash Limited Further provision against the cost of the investment 1979 provision against investment and guarantee liabilities Charter's liability for mine closure costs Deduct Taxation relief 1979 deferred Deduct Share of Cleveland Potash Limited's loss included in group share of associated companies results 5,265 31,551 4,500 _ o_o 9,765 31.551 6,788 2,977 5,561 - 25,990 ii Associated companies comprise the following extraordinary 1980 000 Effect of currency realignment On the group share of retained opening reserves associated companies own accounts 803 1,109 items 1979 000 1,912 Sundry 195 1,717 4,556 1,579 5,801 20,189 Taxation relief on the provisions against the investment in Cleveland is based on 27,595,000 See note 2 i for reference to potential taxation relief on the balance of the Cleveland provision 9. Dividends paid and proposed 197-3.025p Interim dividend of 3p per share 1979-3.025p 1979-3.025p paid on 3 January 1980 Special dividend of 0.35p per share paid on 3 January 1980 Proposed final dividend of 5p per share 1979-5.6p 1979-5.6p 1979-5.6p per share payable on or about 9 August 1980 1980 000 3,146 367 5,247 1979 000 3,172 5,871 NOTE As a result of the restructuring of the group referred to on pages 16 and 17 of the report of the directors the Charter shareholders received one new MINORCO share for every four Charter shares held These new shares rank for the MINORCO final dividend forecast at the time ofthe restructuring 8,760 9.043 to be 15 US cents per share for the year to 30 June 1980 payable in November 1980. Based on the US dollar exchange rate at 31 March 1980 this dividend would the equivalent of 1.73p before taxation for each Charter share 10. Fixed assets COST OR VALUATION At March 1979 Currency realignment Additions at cost Disposal of subsidiaries Disposals Reallocations At March 1980 LONG FREEHOLD LEASEHOLD PROPERTY LEASEHOLD PROPERTY 000 000 SHORT LEASEHOLD PROPERTY 000 PLANT FURNITURE AND FITTINGS 000 38,625 503 1,854 7,131 184 20 3,269 79 235 1 2,136 25 177 322 33 19 69,464 1,257 16,382 18,136 2,802 32,681 3,112 1,914 63,651 DEPRECIATION At March 1979 Currency realignment Charge to profit and account Disposal ofsubsidiaries Disposals Reallocations 5,486 122 1,063 3,015 4 5 .At March 1980 3,413 396 61 (23) 4 438 34,764 602 6,859 10,313 1,942 28,766 NET BOOK AMOUNTS At March 1980 At March 1979 29,268 33,139 34,885 34,700 NOTES i Fixed assets are included on the following bases At cost At valuation - 1972 1 1974 1975 1976 1978 16,114 119 268 13,907 1,123 1,150 1,887 882 310 33 1,194 720 32,681 3,112 1,914 MINING RIGHTS 000 TOTAL 000 2,969 107 2,862 116,463 1,892 " 18,492 28,451 3,254 101,358 41,558 740 8,073 13,875 1,994 33,022 68,336 74,905 82,839 119 1,150 14,937 1,163 1,150 101,358 ii Freehold properties at valuation include an amount of 837,000 relating to land and factory premises acquired by the Belgian subsidiary and financed by secured loans see note 14 The legal title to the factory premises does not vest in the company concerned until the final instalments on the loans have been paid iii Capital expenditure of subsidiaries 1980 000 Committed Authorized but not committed 2,995 5,974 8,969 11. Investments ASSOCIATED COMPANIES Listed in Great Britain Listed outside Great Britain Unlisted Advances Group share of losses les retained profits 1979 profits see note 4 \ MA AT COST LESS AMOUNTS WRITTEN OFF 1980 > 1979 000 000 AT MARKET VALUE OR = DIRECTORS VALUATION 1980 1979 000 000 31,740 89 23,483 : 62 39,580 205 31,649 135 31,829 17,051 48,880 << 23,545 21,679 45,224 158 39,785 27,773 67,558 31,784 .28,360 60,144 158 48,880 45,382 67,558 60,302 1,881 _ 46,999 10,091 _- 55,473 OTHER INVESTMENTS Listed in Great Britain Listed outside Great Britain Unlisted 66,211 18,825 85,036 10,676 95,712 76,223 17,598 93,821 9,012 102,833 143,472 18,343 161,815 12,802 174,617 192,518 17,140 209,658 12,279 221,937 TOTAL INVESTMENTS Listed in Great Britain Listed outside Great Britain Unlisted including advances 103,497 18,999 122,496 20,215 142,711 108,619 17,717 183,052 18,548 126,336 31,970 201,600 40,575 158,306 242,175242,175 224,167 17,275 241,442 40,797 282,239 NOTES i Commitments by the company and its sub- sidiaries in respect of subscriptions for shares and loan facilities amount to 271,000 1979 - 5,723,000 : ii The greater part of the investments is of a long term nature but in the event of their realization at market or directors valuation there would be taxation liability of approximately 28 million Taxation payable would depend on the availability of relief in respect of losses 12. Stocks and work in progress Contract work in progress Deduct Progress payments received and receivable Raw materials and consumable stores Work in progress Finished goods 1980 000 67,954 61,822 6,132 18,127 5,839 23,726 53,824 1979 000 50,686 46,095 4,591 21,493 5,652 20,068 51,804 13. Creditors Creditors include payments ii an amount of 8,721,000 1979 - receivable in advance for 6,643,000 in respect of received and contract and work in progress of Cape Industries Limited iii an amount of 5,931,000 in respect of Cleveland Potash Charter's maximum liability for closure costs Limited's guarantees and . 14. Long term indebtedness Debenture stocks secured issued by i Charter Consolidated Investments Limited 41 per cent first debenture stock 1978/83 4 per cent second debenture stock 1978/83 ii Cape Industries Limited . 7 per cent debenture stock 1986/89 6 per cent debenture stock 1986/89 Unsecured loan stocks issued by i The company 5 per cent convertible loan stock 1984 ii Cape Industries Limited 7 per cent loan stock 1986/91 | iii Swaziland Collieries Limited 9 per cent registered convertible notes 1972/81 Bonds issued by Charter Consolidated Overseas N.V. ( 6 per cent unsecured bonds of DM106,000,000 1968/83 ii 7 per cent guaranteed bonds of FF68,000,000 1987 see note ii below Belgian secured 1980/86 _ 6,996 211 27,824 8,615 _ 286 Bank loans secured see note iii below Bank loans unsecured 1980/89 see note iii below 14,266 1,730 7,130 46,135 180 10,362 NOTES i Repayments are due as follows : BANK BANK OTHER BORROW INGS 000 000 Between and 816 Between two and five years years Over five years . 613 7,431 1,885 12,381 So 816 2,498 19,812 8,860 _ 14,266 _ 23,126 ii The FF68,000,000 7 per cent bonds 1987 are listed The guaranteed Stock in London The Exchange company has guaranteed the bonds as regards repayment of principal including premium if any and payment of interest 23,126 56,677 ii are iii Bank loans following repayable in the following currencicuerresncies Sterling Belgian francs US dollars Swedish kroner French francs Dutch guilders Deutsche marks . 1980 000 1979 000 3.720 ** 4,918 3,9-10 631 1.393 1,899 6.16 787 532 355 311 130 _ _ __ 8,860 10.5-12 _ 15. Share capital Authorized Issued Fully paid shares Fully paid shares with restricted rights see note ii below Partly paid shares 1p paid see note v below Total of issued share capital 31 March 1980 31 March Shares of - Shares of each 25p each 134,085,626 2,681,713 120,000,000 30,000,000 104,930,304 95,764 217,450 2,098,606 ~ 1,915 Ne 2,174 104,847,302 _ 277.000 . 26,211,825 2,770 | 2,102,695 26,214,595 * NOTES i As a result of the of scheme arrangement the nominal value of the company's shares was reduced December December from 25p each changes 1979. The to 2p each in the on 4 company's authorized and issued share capitals which took place following approval by the High Court of Justice are described in the report of the directors on page 17 ii In terms of the scheme of arrangement 118,948 fully paid shares of 2p each were allotted on 13 December 1979 the holders of the com pany's partly paid shares These are subject to the same restrictions as the partly paid shares to which they relate until such time as those partly paid shares become fully paid As a result of partly paid shares becoming fully paid 23,184 of the fully paid shares with restricted rights had become free of restric- tion by 31 March 1980 : iii September 1979 268 fully paid shares of 25p each were issued against conversion of1,113 of the company's five per cent convertible un- secured loan stock 1984. As provided in the scheme of arrangement the balance of the loan stock was redeemed at par on 5 December 1979 iv During the year 59,550 partly paid shares were fully paid up see report of the directors Under the share incentive scheme adopted in 1970 and the share option scheme designed to supersede it in 1973 the directors can at their discretion issue to senior employees up to a further 2,642,088 partly paid shares under the former scheme or options to subscribe for up to 2,873,500 shares premium = Balances at 31 March 1979 Applied in capitalization of 118,948 fully paid shares of 2p each see note 15 ii Applied towards paying up 2,140,914,374 A shares see note 18 ii Reduction on disposal of subsidiary company Premium on shares issued by the company Balances at 31 March 1980 GROUP 000 30,695 2 18,702 11 84 12,064 COMPANY 000 18,702 2 18,702 _ 84 82 17. Reserves Group reserves at 31 March are held as follows Parent company Subsidiary companies Associated companies see note 4 1980 000 2,420 210,103 1,881 1979 000 4,626 145,093 10,091 210,642 159,810 NOTES ) In the event of certain overseas subsidiaries and associated companies distributing reserves or profits additional liability to United Kingdom and overseas taxation would arise ii The movement in reserves of the parent company of 2,206,000 is accounted for by retained profits after payment of dividends of 8,322,000 included in the consolidated profit and loss account and a reduction in reserves of 10,528,000 as a result of the scheme of arrangement see note 18 18. Scheme of arrangement Under the scheme of arrangement referred to in the report of the directors on pages 16 and 17 the following transactions were effected on the dates shown ) Transfer of investments and cash . Investments and cash totalling 53,347,000 were vested by the company in Newco Holding Ltd Newco in exchange for Newco renounceable loan stock of the same . amount Issue of A shares holdings 2,140,914,374 A shares of 2p each were issued on 4 December 1979 on renounceable allotment letters to the holders of Charter fully paid shares pro rata to their These shares were paid up in full from the following Reduction in the nominal value of 104,854,470 fully paid shares in issue on 4 December 1979 from 25p to 2p each Appropriated from the share premium account of the company 000 24,117 18,702 42,819 Renunciation of shares The A shares renounced on 4 December 1979 in favour of MINORCO In consideration for the renounced shares MINORCO allotted one MINORCO ordinary share to Charter shareholders for every four Charter fully paid shares Cancellation of A shares and renunciation of Newco renounceable On the allotment of the MINORCO shares to the Charter shareholders the A shares renounced in favour of MINORCO 7 were cancelled on 5 December 1979 : renounceable loan stock . _ 000 a 42,819 Immediately after the cancellation of the A shares the Newco renounceable loan stock was renounced in favour of MINORCO 53,347 Reduction in reserves 10,528 19. Contingent liabilities and outstanding commitments For amounts not called on investments In respect of guarantees of 9,929,000 less guarantees 1,805,000 company net - 12,969,000 1979 20,415,000 respect of underwriting participations and options granted Bills receivable discounted Finance leases for acquisition of plant machinery Other items NOTES i Certain companies in the Cape Industries Limited group continue to be named along with other asbestos fibre and asbestos product suppliers as defendants in legal actions in the USA claiming damages as a result of the use of their products Charter in its capacity as the holding company of Cape Industries Limited has also now been named as a defendant in one such action Charter has been informed by a United States corporation named in similar actions that in the event of such actions against it and certain related corporations being successful any damages awarded against such corporations would be claimed by them from Charter The Cape Industries Limited group has retained obliga- tions in respect of claims made or which may be made within a limited period against companies disposed of under the sale of its mining division The directors believe in the light of legal advice received that the outcome of these actions and the obligations retained are unlikely to have any material effect on the group's financial position and accordingly no provision in respect of this has been made ii The net guarantee liability for 1980 includes 2,676,000 1979 - 3,775,000 for Botswana RST Limited Limited : 20. Source and application of funds from i Net cashproceeds received the restructuring realization of the group * Proceeds frofmrom investments experises including subsidiary company less experises Deduct Transfer of investments and cashin exchange .. for MINORCO shares as part of the scheme of arrangement : 125,896 53,347 , & oo stock convertible Deduct Investments purchased of Repayment fiveper cent . loan Net cash proceeds before taxation . . NOTE Taxation of 8,069,000 is payable after 31 March 1980 72,549 30,872 S.,, 2,337 . 39,310 ii Effect on net assets of the disposal of Cape Industries Limited South African mining division : disposals Fixed asset . Stocks .- a oe : 14,391 OB po 5,257 Debtors - Creditors including taxation : Bank loans and overdrafts _ Deferred re 6,514 3,715 . a 3,974 . . 3,463 iii DM Unsecured 61 per cent ~ loan bonds Balance at 31 March 1979 : ; : Repaid during year Repaid from net liquid funds on 1 April 1980 ; . 15,010 an 8. 27,824 - 8,822 ; - 19,002 iv Investments . realizations Long - term purchases o : - book value of of net book value realizations under scheme of arrangement Portfolio net purchases at book value of Realizations less purchases investments contributed 29,330,000 1979 - 17,159,000 to the source of funds v Analysis of working capital Increase in stocks and work in progress Increase in debtors Increase in creditors Other items 15,357 1,027 7 13,150 1,180 . 4,763 5,943 vi Net assets on acquisition of subsidiaries Fixed assets Investments Goodwill Stocks Debtors Creditors Taxation Government grants Cash Other items Principal interests Company INDUSTRIAL Anderson Strathclyde Limited 26.4 per cent of holding was purchased on 27 May 1980 Cape Industries Limited Country of incorporation Scotland England Heatrae Holdings Limited England Johnson Matthey & Co. Limited MKR Holdings Limited formerly M.K. Refrigeration Limited England England Pandrol International Limited England ia formerly Elastic Rail Spike Company Limited Torque Tension Limited England MINING Anmercosa Sales Limited England Beralt Tin and Wolfram Limited England Botswana RST Limited Botswana Charter Mineral Services Limited England Cleveland Potash Limited England Malaysia Mining Corporation Berhad Malaysia Pernas Charter Management Sendirian Berhad Malaysia Soci^'t^M'ini^red'Anglade Tara Exploration and Development Company Limited France Canada OTHER INVESTMENTS Anglo American Corporation of Canada Limited Anglo American Corporation Zimbabwe Rhodesia Limited The Argus Printing and Publishing Company Limited Canada Zimbabwe South Africa Group interest equity capital per cent Nature of business Engineering Insulation products friction materials automotive components insulation contracting and fire protection Domestic and industrial heating equipment commercial catering equipment commercial refrigeration Metal refining and industrial Bar cooling and drink dispensing equipment contract furniture Railway track fastenings Mine roof bolting systems and drilling equipment Marketing of metals Wolfram mining in Portugal Nickel and copper mining Technical services Potash mining Tin mining Technical and administrative services Wolfram mining Zinc and lead mininign the Republic ofIreland Mining finance Mining finance and investment Printing and publishing Accounting date December December March December December December March December December September January December September Company Covenant Industries Limited Country of incorporation England Euranglo Limited Haw Par Brothers International Limited South Africa Singapore Minerals and Resources Corporation . Bermuda Limited The Rio Tinto Corporation Limited England Selection Trust Limited Tinnabruich Pty Limited associated companies at 31 March 1980 England Australia Group interest in equity capital percent 33.9 of businbuesis nes ss Marketing and manufacture of chemicals in Africa Investment General trading insurance shipping and investment International mining finance and investment International mining and industrial September March September International mining finance Investment NOTES 1. Restructuring of the group see report of the directors on pages 16 and 17 oo a Anglo Ameri Corporation of Canada Limited and Minerals a sources Corporation Limited ceased to be associated co apanies on 30 September 1979 b Johnson Matthey & Co. Limited became an associated company from 1 October 1979 c Charter ceased to account for its share of Cleveland Potash Limited's losses after the nine months to 30 September 1979 2. The group holds 50 per cent of the 10 per cent redeemable participating preference shares of Cleveland Potash Limited subsidiaries 3. A full list of the company's major subsidiaries is pages 40 and 41 subsidiaries incorporation indicated 4. Except where indicated the nature of business the country of operation the same as the country of principal i hi Analysis of assets and income Geographical analysis of total assets and revenue a if Assets 1980 1979 000 000 United Kingdom Rest of Europe North and South America South Africa Rest of Africa South Asia Australasia 170,760 27,958 69.789 11,570 18,935 21,648 45.090 103.975 31,463 9.699 98,701 34,701 19,956 31,251 365.750 409,746 Per cent assets 1980 46.7 7.6 25.4 7.6 Analysis by category investments and investment income Investments 1980 1979 000 2000 Mining - Finance Diamonds Gold wolfram Copper potash and other minerals Industrial commercial etc. Long term loans =<>., . 132,759 8,055 1.765 18,090 7.316 72,628 1.562 169.362 44.507 167 31.235 2,208 242.175 282.239 282.239 Per cent investments 1980 1979 54.8 3.3 0.7 7.5 3.0 30.0 0.7 60.0 15.7 1.9 5.2 5.3 11.1 0.8 Analysis by product category of turnover and operating profit of industrial subsidiaries Turnover 1980 1979 000 .2000 Building and insulation products Automotive and engineering products Mining and sale of asbestos fibre Heating catering and bar equipment Railway track fastenings Mining equipment Coal mining 136,006 57,070 11,134 37,234 19,189 5,373 941 25,615 32.386 4,313 1,813 Deduct Sales between different classes of business 266,947 240,070 1,624 238.446 Operating profit 1980 1979 000 000 12,051 1,230 1,533 2,878 2,009 375 123 8.688 2,178 4.180 3,107 1,910 433 391 20,199 409 20,887 NOTES 1. Listed investments are included at market value at 31 March and unlisted investments at directors valuation at 31 March March The geographical analysis takes into consideration direct interests and where possible major indirect interest in the areas concerned and is therefore only approximate Deferred taxation is excluded : 3. The analysis of investments does not include the industrial subsidiaries cent revenue 1980 1979 38.7 6.1 Per cent investment income 1980 1979 44.1 25.4 3.0 9.7 4.0 13.0 0.8 100.0 51.4 22.4 3.7 9.6 3.1 8.9 0.9 100.0 Five year financial record Charter Consolidated Limited and its subsidiary companies EARNINGS year to 31 March Profit before taxation Charter and subsidiary companies Associated companies Taxation Outside shareholders interest Earnings attributable to shareholders Dividen is paid Earnings per share H Dividends per share net of imputed tax credit NET ASSETS 31 31 March including investments at market or directors valuation Investments At book amount Appreciation of investments Market or directors valuation Fixed assets and exploration and development expenditure Net current assets Long term indebtedness minority interest capital expenditure grants and deferred taxation aod 1980 000 1979 000 1978 000 38,886 13,463 52,349 20,752 31,597 3,659 27,938 8,760 19,178 26.63p 8.35p +144.603 56 * 44,547 17.965 13.948 21.93p 8.62p 36.394 6.693 43.087 14.387 28,700 3.265 25.435 8.703 16,732 24.26p 8.30p 1977 .2000 38,731 16.134 22,597 3,320 19,277 7,865 11.412 18.40p 7.50p 1976 000 36,437 14.666 21,771 2.382 19,389 7.081 12,308 18.50p 6.76p 142,711 99,464 242,175 68,449 55,126 365,750 41,477 158,306 123,933 282.239 75,027 52.480 409,746 69,093 182.616 80.242 262.858 63.897 39.608 366,363 78,759 195,969 56,823 252,792 54.800 37,679 345,271 71,727 196,151 59,455 255,606 48.010 34,765 338,381 66,981 Net assets per share Represented by Issued share capital Share premium Reserves Appreciation of investments 324,273 309p 340.653 325p 287.604 274p 273,544 261p 271,400 259p 2,103 12,064 210,642 224,809 99,464 324,273 26.215 30.695 159,810 216.720 123,933 340,653 26.212 30.683 150,467 207.362 80.2.12 287.604 26,202 30,631 159,888 216.721 56,823 273,544 26.202 30.622 155,121 211,945 59,455 271,400 NOTES AE reflect 1. The 1980 earnings dividends and net assets the effect of the restructuring of the group as detailed in the report of the directors on pages 16 and 17 2. No account has been taken of taxation on appreciation of investments see note 11 on the accounts on page 31 39 Subsidiary companies Company INDUSTRIAL AND COMMERCIAL Anmercosa Sales Limited .- CAPE INDUSTRIES GROUP : Cape Industries Limited Cape Boards and Panels Limited Cape Building Services Limited Cape Contracts Limited Cape Automotive Limited Cape Insulation Limited Cape Investments S.A. Pty Limited a Cape Universal Claddings Limited Don International Limited Don International S.A. Trist Draper Limited HEATRAE GROUP Heatrae Holdings Limited Heatrae Catering Equipment Limited Heatrae Heating Limited Sadia Airofreeze Limited Nature of business Group interest in equity capital per cent Countroyf incorporation operation Marketing of metals Industrial Insulation board for ship and building construction Fire protection and insulation contracting Industrial thermal insulation contracting Distribution of automotive components Manufacture of insulation products Holding company for South African industrial subsidiaries Asbestos cement products and other building materials Manufacture of friction materials of Manufacture friction materials Manufacture of friction materials Industrial holding company Commercial catering equipment Domestic and industrial heating equipment Commercial refrigeration England England 67.3 England 67.3 England England 67.3 England England Scotland 67.3 South Africa England 67.3 England 67.3 Belgium England /: England j England England |England MKR GROUP formerly MK Refrigeration group MKR Holdings Limited Gaskell & Chambers Limited M.K. Refrigeration Limited Morgan Furniture Limited Paterex Limited Industrial holding company Drink dispensing equipment Bar cooling equipment Contract furniture Precision engineering England England England England England PANDROL GROUP formerly Elastic Rail Spike group Pandrol International Limited Elastic Rail Spike Company Australia Pty Limited Pandrol Canada Limited Pandrol Incorporated Railway track fastenings Railway track fastenings Railway track fastenings Railway track fastenings Torque Tension Limited Mine roof bolting equipment and drilling England Australia Canada United States of America England FINANCE AND INVESTMENT Barnato Holdings U.K. Limited The British South Africa Company The British South Africa Company Investments Limited Central Mining Finance Limited Centramic South Africa Limited Charter Consolidated Finance Limited Charter Consolidated Investments Limited Charter Consolidated Malaysia Sendirian Berhad Charter Consolidated Overseas N.V. Hawkswick Holdings Limited Interlink Investments Limited Leonora Investments Limited Nimbus Investments S.A. Raven Investments Limited Shafford Holdings Limited Tande Investments Limited Town Properties Limited Investment Investment Investment Finance and investment Investment Finance ~ Investment Investment Finance Investment Investment Investment Investment Investment Investment Investment Investment England England England England South Africa England England Malaysia Netherlands Antilles England Canada Gibraltar Luxembourg Gibraltar England England South Africa Company SERVICES Anglo Charter International Services Limited Charter Consolidated Services Limited > Nature of business Employment services Administration and technical services Shares in these companies are held directly by the company the remaining companies shares the are held through subsidiaries NOTES 1. The companies listed above include those whose activities materially affected the profit or assets of the group during the year They exclude former mining subsidiaries of the Cape Industries Limited group disposed during the year 2. A subsidiary holds 100 per cent of the 31 per cent cumulative preference shares of Cape Industries Limited and 67.3 per cent of the 4.2 per cent cumulative preference shares of Don International Limited The accounts of Cape Industries Limited Charter Consolidated Overseas N.V. MKR Holdings Limited and not audited by the Charter auditorbs ut are availaonbalppelication 4. The financial years of the industrial subsidiaries subsidiaries terminate on 31 December Group interest in equity capital per cent Countroyf incorporation operation England England 7 General information Directors interests The following are the interests of the directors of the company who held office on 31 March 1980 as notified to the company in terms of the Companies Act 1967 FULLY PAID SHARES DIRECTORS C. Burnell N. Clarke 25p each each April 1979 100 100 > 2peach 31 March 1980 100 100 E. Collins 100 O. Hambro 1,131 1,745 G.A. Higham M. Hofmeyr F.J. A. Howard appointed 10 August 1979 -500 -500 100 500 H. F. Oppenheimer Sir Philip Oppenheimer W. Owston 100 9.798 100 W. Pain W. Relly 100 500 100 500 100 G. Richardson A. Spinks H.-J. Stucke 100 appointed 16 October 1979 - nil 100 100 500 100 M. Thomas 100 100 J. Ogilvie Thompson 100 100 ALTERNATE DIRECTORS R. Armitage A. Oppenheimer nil nil are not owned benficaly nil nil following Of these directors and alternate directors the following had beneficial interests in the partly paid shares of the company issued underits share scheme fully the company incentive the andin shares paid shares of company allotted to the arrangement of 22 partly paid shares to which they relate The effect of the share scheme was to enable executive and senior employees subscribe for shares which after a qualifying period could be fully paid up at price determined at the time of subscription C. Burnell N. Clarke A.-J.W. A.-J.W. Owston W. Pain J. Richardson R.-J. Armitage FULLY PAID SHARES WITH RESTRICTED RIGHTS PARTLY PAID SHARES ALLOTTED Ip PAID UP each April PAID 2p each 31 March 1979 1980 13 DECEMBER 1979 2p ench 31 March 1980 7.500 12,500 10.000 7,500 7,500 7,500 6,000 12.500 10,000 7,500 Mr A. Higham also had beneficial beneficial G. a eachin Cape Industries Limited a subsidiary 1979 and 31 March 1980 interest in 250 ordinary shares of 25p of the company at 1 April There has been no change notified in any the mentioned interests between the end of the financial year and 10 June 1980 being one month prior to the date of the notice of unnual general meeting There were no contracts or arrangements subsisting during the financial year which require to be disclosed in terms of section 16 of the Companies Act 1967 as interpreted by the Council of The Stock Exchange Substantial shareholding Anglo American Corporation of South Africa Limited hold an interest of 35.8 cent in the issued share capital of the company at June 1980 Taxation i Capital The of the company's shares on fi April 1965 adjusftoretdhe effect Registered restructuring of the group wast - shares 68.73p Shares allotment represented by renounceable renounceable Share warrants to bearer 69.17 69.60p is a ii The company not and Corporation Taxes close company company within the provisions of the Income Act 1970 and this position has not changed since the of end the financial 42 Number and remuneration of employees mainly The number of employees week of the company subsidiaries working wholly or the United Kingdom was 12,581 during the year The aggregate amount of the remuneration paid to such 66,243,000 employees during the year was Political and charitable contributions Contributions for political purposes during the year amounted to Finance Conservative Board of Association and subsidiary a company 300 to the Ashford Conservative Contributions for charitable purposes sidiaries during the year totalled 61,353 made by the company and its sub- Geographical analysis of turnover of industrial subsidiaries cent turnover turnover 1979 United Kingdom Rest Europe Australasia and South North and South America South Africa Rest of Africa and Middle East 74.1 11.0 1.5 4.4 7.3 1.7 See note on page 38 100,0 100.0 Exports The aggregate value of goods during exported industrial subsidiaries the by the group's United Kingdom 28.913,000 1979 - 26,346,009 Investments of 20 per cent or more The following is the information required by The Stock Exchange about the major companies in which Charter's equity interest is 20 per cent or more ASSOCIATED COMPANIES AT MARCH 1984 Beralt Tin and Wolfram Limited Principal country ofoperation Portugal Issued share capital at 31 December 1979 2,868,667 in ordinary shares of each Cleveland Potash Limited Principal country of operationEngland Issued share capital at 31 March 1980 37,000,000 in 7,000,000 shares of each and 30,000,000 10 per cent redeemable participating preference shares of El each ordinary participating Issued loan capital 7,400,000 25 per cent unsecured loan stock 1987 and 155,565 25 per cent unsecured loan stock 1988. of which Charter held 62.3 Issued share capital at 30 September 1979 each Johnson Matthey & Co. Limited Principal of country operation England 53,028,037 in ordinary shares of cumulative preference shares of 21 each 4,500,000 71 per cent debenture stock percent debenture stock 1988-90 Malaysia Mining Corporation Berhad 10,000,000 Principal country of operation Malaysia Issued share capital at 31 January 1980 10,000,000 in shares of MSI eich OTHER COMPANIES Anglo American Corporation Zimbabwe Rhodesia Limited Principal country of operation Zimbabwe Issued sharecapai t 30tJua nel 1979 7828,354,606 Reserves : 7536,603,000 shares ofZ each Selection Trust Limited SelectionPrincipal country of capital operation Issued Mini^re d'Anglade Principal country of operation France Issued share capital at 31 December 1979 FF6,000,000 in shares of FF100 each Reserves FF1,230.163 FF1,230.163 a Group directory Chairman Dr A. Spinks Executive directors N. Clarke Chief executive G. A. Higham Industrial F. J. A. Howard Finance Sir Philip Oppenheimer A. W. Owston Mining W. Pain G. Richardson Administration Managing directors of industrial subsidiaries CAPE INDUSTRIES W. R. Doughty HEATRAE M. W. King MKR HOLDINGS J. Hamilton PANDROL INTERNATIONAL B. Clough TORQUE TENSION M. Stokes Officials R. Armitage MANAGER Administration treasury J. D. Ballardie Special industrial projects D. Booth Secretary I. R. M. Chaston Consulting metallurgist J. V. Cleasby Consulting engineer head of technical department H. Dawkins '! Group chief accountant A. Dunster Corporate finance manager H. O. Ellison Public relations consultant C. Forristal Consulting engineer P. A. L. Gordon < Manager new mining mining business , , H. Livingstone- Learmonth MANAGER Manager mining operations N. McNair Scott MANAGER Business development manager R. D. McVean Personnel consultant Dr J. F. Osten Consulting geologist J. A. Pool Industrial liaison manager A. W. Purkiss Consulting mechanical and electrical engineer J. A. Shoubridge Ashford office administrative manager C. Smets Chief economist M. Statham Investment manager J. de W. Waller Manager metal sales Offices 40 Holborn Viaduct London ECIP 1AJ registered Charter House Park Street Ashford Kent TN21 SEQ 44 Main Street Johannesburg 2001 South Africa PO Box 28 TorontoDominion Centre Toronto Ontario M5K 1B8 Canada 70 Jameson Avenue Central Salisbury C1 Zimbabwe 8th Floor Oriental Plaza Jalan Parry Kuala Lumpur 04-01 Malaysia rue de Vienne 75008 Paris France 244 Avenida da Liberdade Lisbon 2 Portugal Registrars Charter Consolidated Services Limited PO Box 102 Charter House Park Street Ashford Kent TN24 NEQ Consolidated Share Registrars Limited 62 Marshall Street Johannesburg 2001 South Africa 43 Laas Proc^'durepermettant aux d^'tenteursde certificats d'actions au porteur d'assister ^ une assembl^'eg^'n^'rale d^'sirant Les d^'tenteursde certificats d'actions au porteur * assister en leur qualit^' de membre^ une assembl^'e g^'n^'ralseont tenus de d^'poserleurs certificats d'actions trois jours ouvrables franes au moins avant la date de l'asembl^'e l'assembl^'e directeur au bureau du du registre de la soci^'t^a'u Royaume- Uni ^ ceux des agents de la soci^'t^^l''^'tranger Les administrateurs acceptent qu'^ la place du certificat d'actions soit d^'pos^'eune attestation attestation d^'livr^'epar une banque ou par toute autre personne d^'clarantavoir re^u du certificat d'actions La banque ou d^'p^t le la personne habilit^'edoit s'engager ne remettre certificat d'actions au que de ^ d^'posantcontre remise l'attestation d^'p^ettd'engagement la soci^'t^r'emettra au d^'posantd'un certificat d'actions ou d'une attesta- tion de d^'p^ett d'engagement une carte d'admission portant ses nom et adresse de m^"meque le nombre d'actions repr^'sent^'par le certificat correspondani Cette carte lui permettra de ce fait et d'assister de voter en mandataire g^'r^'rnie personne ou par mandataire^ une assembl^'e g^'r^'rnie des formulaires peuvent ^"treobtenus des aupr^s bureaux indiqu^'s dessus MM les actionnaires peuvent se procurer des exemplaires des con- ditions r^'gissantles certificats d'action au porteur en s'adressant au si^ge social ou au bureau du directeur du registre de la soci^'t^'soit aux bureaux Lyonais des 19 agents de la soci^'t^'aux adresses boulevard des Italiens 75002 Paris Cr^'dit Banque Rothschild 21 rue Laffitte 75009 Paris Procedure for holders of share warrants to bearer to attend a general meeting Holders of share warrants to bearer wishing to attend as members at a general meeting must deposit their share warrants at least three clear normal business days before the meeting at the offices of the company's registrars in the United Kingdom or any of the company's overseas paying agents The directors may accept in lieu of the deposit of a share warrant a certificate from a banker or other approved person to the effect that the share warrant has been deposited him The banker or person with the share approved must give an undertaking not to surrender warrant to the depositor except against return of the certifiofcdaeptoseit and the undertaking The company will deliver to the person depositing a share warrant or certificate of deposit and an undertaking an admission card stating his name address and the number of shares represented the relative warrant to enable him attend and vote in persoo r bny proxy at meeting forms are available from the abovementioned offices Copies of the conditions governing share warrants to bearer are available from the registered office of the company and the office of its registrars in the United Kingdom and from the company's overseas paying agents Cr^'ditLyonnais 19 boulevard des Italiens 75002 Paris and Banque Rothschild 21 rue Laffitte 75009 Paris MM les actionnaires sont inform^'squ'ils peuvent se procurer un exemplaire en fran^aisde ce rapport ens'adressant soit ^ Charter Consolidated Limited 40 Holborn Viaduct London EC1P1AJ EC1P1AJ soit ^ Charter France 9 rue de Vienne 75008 Paris soit ^ Cr^'dit Lyonnais 19 boulevard des Italiens 75002 Paris soit la Banque Rothschild 21 rue Laffitte 75009 Paris in Printed England by Westerham Press Charter Consolidated Limited fer be a The following is the text of press announcement issued . by Charter on Monday 7 July 1980 W The British Petroleum Company Limited BP and Selection Trust Limited Selection Trust have today announced details of BP's offer for the issued share capital of Selection Trust of which Charter Consolidated Limited Charter holds 25.7 per cent Charter has indicated its intention to accept this offer which if the offer becomes unconditional will result in the receipt by Charter of cash or BP Ordinary Shares to an aggregate value in excess of 100 million As mentioned in the detailed announcement ofthe offer for Selection Trust Charter BP and Selection Trust have agreed that negotiations should take place for the acquisition by Charter ofthe Alexander Shand group from Selection Trust and of participations in certain North Sea oil interests from BP although there is no commitment in principle or as to price to conclude such negotiations Alexander Shand would provide a base for the development ofopencast coal mining operations internationally participations in North Sea oil would support Charter's existing involvement in North Sea exploration These potential acquisitions which will only absorb a part of the consideration in receivable by Charter for its holding Selection Trust are in furtherance of the of policy outlined at the time the reorganisation announced in the Autumn of 1979 of developing Charter's business in industry and mining