Annual report 2006

Annual Financial Statements49¬ Report of the independentauditors 50¬ Secretarial certification 50¬ Directors’ responsibility statement 51¬ Directors’ report 52¬ Balance sheets 54¬ Income statements 55¬ Statements of changes in equity 56¬ Reconciliation of previous SA GAAPto IFRS and restated SA GAAP 57¬ Cash flow statements 58¬ Notes to the cash flowstatements 59¬ Accounting policies 61¬ Notes to the annual financialstatements 67¬ Annexure 1 91¬ Linked unitholders’ information– diary 92¬ Linked unitholders’ information– notice of meeting 94¬ Administration 98¬ Form of proxy– linked unitholders 99¬ Notes to proxy 100Annual financial statementsASTRAPAK ANNUAL REPORT 2006

Report of the independent auditorsTo the linked unitholders of Astrapak LimitedWe have audited the annual financial statements and groupannual financial statements of Astrapak Limited set out on pages52 to 90 for the year ended 28 February 2006. These financialstatements are the responsibility of the Company’s directors.Our responsibility is to express an opinion on these financialstatements based on our audit.We conducted our audit in accordance with InternationalStandards on Auditing. Those Standards require that we plan andperform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. Anaudit includes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements. Anaudit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluatingthe overall financial statement presentation. We believe that ouraudit provides a reasonable basis for our opinion.In our opinion, the financial statements present fairly, in all materialrespects, the financial position of the Company and the Groupat 28 February 2006, and the results of their operations and cashflows for the year then ended in accordance with InternationalFinancial Reporting Standards, South African Statements ofGenerally Accepted Accounting Practice AC 500 series and in themanner required by the Companies Act of South Africa.Deloitte & ToucheRegistered AuditorsPer L Taljaard – Partner30 August 2006Buildings 1 and 2, Deloitte PlaceThe Woodlands Office Park, Woodlands DriveSandtonNational Executive: GG Gelink Chief Executive, AE SwiegersChief Operating Officer, GM Pinnock Audit, DL Kennedy Tax,L Geeringh Consulting, MG Crisp Financial Advisory,L Bam Strategy, CR Beukman Finance, TJ Brown Clients & Markets,SJC Sibisi Public Sector and Corporate Social Responsibility,NT Mtoba Chairman of the Board, J Rhynes Deputy Chairmanof the BoardA full list of partners and directors is available on request.Secretarial certificationIn accordance with section 268G(d) of the Companies Act, it is hereby certified that the Company has lodged with the Registrar ofCompanies all such returns as are required of a public company in terms of the Act and that such returns are true and correct for thefinancial period ended 28 February 2006.Y CowleyG KingCompany SecretaryCompany SecretarySandtonSandton14 July 2006 30 August 200650ASTRAPAKANNUAL REPORT 2006

Directors’ responsibility statement51The directors of the Company are responsible for the maintenanceof adequate accounting records and the preparation and integrityof the annual financial statements and related information. Theannual financial statements have been prepared in accordancewith the Companies Act in South Africa, International FinancialReporting Standards and the AC 500 standards as required by theAccounting Practices Board.The Group’s independent auditors, Deloitte & Touche, haveaudited the annual financial statements and their unqualifiedreport appears above.The directors are also responsible for the systems of internalcontrol. These are designed to provide reasonable, but notabsolute, assurance as to the reliability of the annual financialstatements, and to adequately safeguard, verify and maintainaccountability of assets, and to prevent and detect materialmisstatement and loss. The systems are implemented andmonitored by suitably trained personnel with an appropriatesegregation of authority and duties. Nothing has come tothe attention of the directors to indicate that any materialbreakdown in the functioning of these controls, procedures andsystems has occurred during the year under review.The annual financial statements are prepared on a goingconcern basis. Nothing has come to the attention of thedirectors to indicate that the Group will not remain a goingconcern for the foreseeable future.The annual financial statements set out on pages 52 to 90were approved by the Board of Directors and are signed on theirbehalf by:R Crewe-BrownHA ToddChief Executive OfficerFinancial DirectorSandtonSandton30 August 2006 30 August 2006ASTRAPAK ANNUAL REPORT 2006

Directors’ report52ASTRAPAKThe directors’ report on the Company and the Group for the yearended 28 February 2006 is as follows:Nature of businessThe Group is engaged in the plastic packaging industry,providing products and packaging solutions to manufacturersand retailers of consumer products.Trading resultsA summary of the Group’s trading results is set out below:RestatedR million 2006 2005Revenue 1 874,0 1 650,2Trading income 221,7 182,7Profit after taxation 147,6 115,1Attributable to linked unit holders 139,0 109,3Earnings per linked unit (cents) 122,5 121,0Headline earnings per linked unit (cents) 125,9 116,6Share capitalDetails of the authorised and issued share capital are given innote 10 to the annual financial statements.Ten percent of the unissued share capital was placed underthe control of the directors in terms of section 221 of theCompanies Act 61 of 1973 at the annual general meeting heldon 22 September 2005.During the current year, 15 014 583 deferred ordinary par valueshares of 0,1 cent each in the authorised and issued shares wereconverted into 15 014 583 ordinary par value shares of 0,1 cent each.There were no other share issues during the year.Linked unitsThe ordinary shares are linked to the debentures to form a linkedunit in Astrapak Limited. As at 28 February 2006, each linkedunit comprised one ordinary share of 0,1 cent each and onedebenture of 50 cents each.The holder of a linked unit will be entitled to receive dividendson the equity portion of the linked unit and will receive intereston the debenture portion of the linked unit.SubsidiariesDetails of operating entities are set out in note 29 to the financialstatements.A number of special resolutions were passed by subsidiarycompanies. None of these resolutions is of significance to the linkedunitholders in assessing the state of affairs of the Group.DirectorsThe names of the directors of the Company are listed on pages12 to 13 of this report.No appointments have been made or resignations acceptedduring the financial year under review.In accordance with the Company’s Articles of Association,one-third of the directors shall retire at the forthcoming AnnualGeneral Meeting but, being eligible, offer themselves for reelectionand shall be deemed not to have vacated their respectiveoffices. (Refer to notice of meeting on page 94 for further details).Directors’ remunerationThe aggregate remuneration and benefits paid to the executiveand non-executive directors of the Group for the year ended28 February 2006 are set out in the Remuneration Report onpages 46 to 48 of this annual report and notes 17 and 33 to theannual financial statements.Astrapak Limited Linked Unit Trust SchemeFurther details on the Astrapak Limited Linked Unit Trust Scheme(“the scheme”) and the number of options issued to executiveand non-executive directors in terms of such scheme are set outin the Remuneration Report on pages 46 to 48 of this annualreport. Mr PC Botha resigned as a trustee of the scheme on17 January 2006 and Mr AM Chait was appointed in his place,along with the current trustee Mr M Ball.Profit and losses of subsidiary companiesThe total after-tax profit by subsidiaries attributable to the Groupwas R197 297 235 (2005: R143 039 939). Subsidiaries incurredlosses of R49 685 087 (2005: R27 972 953).Distribution to linked unitholdersDebenture interest of 5,25 cents (2005: 6,20 cents) per linked unitwas paid, totalling R7,1 million (2005: R8,4 million). The interestpayment approximates the average prime rate of interest forthe financial year ended 28 February 2006. In addition, Astrapakpaid an ordinary dividend of 24,75 cents (2005: 16,50 cents) perlinked unit totalling R33,4 million (2005: R22,3 million) to linkedunitholders for the year ended 28 February 2006. The totalcombined dividend and debenture interest was 30,00 cents(2005: 22,70 cents) per linked unit totalling R40,5 million(2005: R30,7 million).Both distributions were paid on Monday, 5 June 2006 to linkedunitholders recorded in the register on Friday, 2 June 2006. Thelast date to have traded cum-distribution was Friday, 26 May2006 and the linked units commenced trading ex-distributionon Monday, 29 May 2006. Linked unit certificates could not bedematerialised or rematerialised between Monday, 29 May 2006and Friday, 2 June 2006, both days inclusive.Post balance sheet eventsSubsequent to 1 March 2006, the following events have takenplace:• Astrapak KwaZulu-Natal acquired a further 25% of the sharesbelonging to the minority shareholders of Tamperpak.Astrapak KwaZulu-Natal now holds 100% of the shares inTamperpak.• Astrapak Limited acquired 100% of the shares of Alex WhiteHoldings.• Astrapak has made an offer, subject to approval by theCompetitions Commission, for the assets of Plastform, whichforms part of Consol.ANNUAL REPORT 2006

Directors’ report (continued)53Directors’ interestDirector Beneficial direct Non-beneficial indirect Unitholding (%)Interest in linked units as at 28 February 2005 822 673 15 129 348 11,8RAP Upton 53 333 – 0,0R Crewe-Brown 210 460 595 648 0,6M Baglione 153 100 56 700 0,2WJ Venter 190 780 – 0,1PC Botha* – 14 337 000 10,6RT Dalais – 140 000 0,1G Petzer 126 000 – 0,1M Diedloff 89 000 – 0,1Net (sales)/purchases from 1 March 2005 to 28 February 2006 (1 385 706) (14 198 256) (11,5)RAP Upton (219 999) – (0,2)R Crewe-Brown (137 670) – (0,1)M Baglione (143 100) – (0,1)WJ Venter (76 667) – (0,1)PC Botha* – (14 327 000) (10,6)RT Dalais – 128 744 0,1G Petzer (292 000) – (0,2)HA Todd (220 833) – (0,2)M Diedloff (295 437) – (0,2)Exercise of options from 1 March 2005 to 28 February 2006 1 372 500 – 1,0RAP Upton 166 666 – 0,1R Crewe-Brown 150 000 – 0,1WJ Venter 116 667 – 0,1G Petzer 506 667 – 0,4HA Todd 220 833 – 0,2M Diedloff 211 667 – 0,2Interest in linked units as at 28 February 2006 809 467 931 092 1,3R Crewe-Brown 222 790 595 648 0,6M Baglione 10 000 56 700 0,0WJ Venter 230 780 – 0,2PC Botha* – 10 000 0,0RT Dalais – 268 744 0,2G Petzer 340 667 – 0,3M Diedloff 5 230 – 0,0* During the year Mr PC Botha resigned as a trustee of the Astrapak Limited Linked Unit Trust Scheme and the linked units previously allocated to him as non-beneficial indirect, as a result of his position astrustee, are now ignored.# The number of linked units held by directors changed as follows between 1 March 2006 and the date of this report:Interest in linked units as at the date of this report 2 458 570 1 046 092 2,6R Crewe-Brown 472 790 595 648 0,8M Baglione 676 667 56 700 0,5WJ Venter 564 113 – 0,4PC Botha* – 125 000 0,1RT Dalais – 268 744 0,2G Petzer 450 000 – 0,3HA Todd 78 333 – 0,1M Diedloff 216 667 – 0,2Service contractsIndefinite-term contracts based on a notice period of three months by either party, have been signed by the following directors:Messrs R Crewe-Brown, HA Todd, WJ Venter, M Baglione and G Petzer. Mr M Diedloff has signed an indefinite-term contract based on anotice period of one month by either party.ASTRAPAK ANNUAL REPORT 2006

Balance sheetsat 28 February 20062006Group CompanyRestated2005 R’000 Notes 2006Restated2005ASSETS764 323 571 967 Non-current assets 453 111 209 333615 821 480 971 Property, plant and equipment 1 876 97690 201 42 086 Goodwill 2 – –27 – Trademarks 3 – –41 017 32 111 Deferred tax assets 4 12 037 6 73717 080 16 724 Investments and loans 5 47 744 43 946177 75 Investment in associate company 6 – –– – Investment in subsidiaries 7 392 454 157 674690 916 540 561 Current assets 45 457 53 553245 192 186 960 Inventories 8 – –291 183 250 883 Accounts receivable 9 13 685 498144 456 98 224 Cash and short-term investments 14 31 772 53 05510 085 4 494 Taxation receivable – –1 455 239 1 112 528 Total assets 498 568 262 886EQUITY AND LIABILITIES731 739 520 530 Total equity 444 177 246 471135 135 Share capital 10 135 135199 367 84 302 Share premium 10 199 367 84 302523 109 405 438 Retained income 171 779 99 17317 858 Non-distributable reserves 11 – –5 331 2 803 Capital reserve 5 331 2 803(79 450) (48 950) Treasury linked units 12 – –648 509 444 586 Ordinary shareholders’ fund 376 612 186 41359 616 52 409 Debentures 13 67 565 60 058708 125 496 995 Equity attributable to linked unitholders of the parent 444 177 246 47123 614 23 535 Minority interest – –222 795 194 886 Non-current liabilities – –144 371 145 058 Long-term interest-bearing debt 14 – –78 424 49 828 Deferred tax liabilities 4 – –500 705 397 112 Current liabilities 54 391 16 415320 614 235 080 Accounts payable 15 35 516 7 30335 901 41 896 Provisions 16 4 188 2 2706 260 5 883 Linked unitholders for debenture interest 7 094 6 742122 173 105 299 Short-term interest-bearing debt 14 7 593 10015 757 8 954 Taxation payable – –1 455 239 1 112 528 Total equity and liabilities 498 568 262 88654ASTRAPAKANNUAL REPORT 2006

Income statementsfor the year ended 28 February 2006552006GroupRestated2005 R’000 Notes 2006CompanyRestated20051 873 962 1 650 227 Revenue – –(1 376 059) (1 214 518) Cost of sales – –497 903 435 709 Gross profit – –– – Dividends received 61 921 31 83519 044 17 441 Other operating income 38 264 31 501(149 923) (129 015) Distribution and selling costs – –(148 882) (145 060) Administrative and other operating expenses 702 (13 920)3 530 3 619 Share of results of associate company and joint venture – –221 672 182 694 Trading income 17 100 887 49 416– 12 783 Exceptional items 18 – –221 672 195 477 Profit from operations 100 887 49 4163 665 2 416 Investment income 19 11 642 12 166(40 865) (49 428) Finance costs 19 (18 436) (20 049)184 472 148 465 Profit before taxation 94 093 41 533(36 859) (33 396) Taxation (charge)/credit 20 2 414 1 222147 613 115 069 Profit for the year 96 507 42 755Attributable to:139 001 109 241 Linked unit holders of the parent8 612 5 828 Minority interest147 613 115 069 Profit for the year122,5 121,0 Earnings per linked unit (cents) 21111,8 105,5 Diluted earnings per linked unit (cents) 21ASTRAPAK ANNUAL REPORT 2006

Statements of changes in equityfor the year ended 28 February 200656ASTRAPAKR’000Sharecapital andpremiumRetainedincomeNondistributablereserveDividendreserveCapitalreserveTreasurylinked units DebenturesAttributableto linkedunitholders’parentMinorityinterestsGROUPBalance as at 1 March 2004 108 298 172 2 878 6 215 – (23 208) 47 804 331 969 55 301 387 270SA GAAP and IFRS adjustments (1 975) 1 080 (895) (895)Restated balance as at 1 March 2004 108 296 197 2 878 6 215 1 080 (23 208) 47 804 331 074 55 301 386 375Net profit for the year 109 241 109 241 5 828 115 069Net ordinary dividends paid (6 215) (6 215) (2 740) (8 955)Adjustments to minority interest (34 854) (34 854)Decrease in foreign currencytranslation reserve (683) (683) (683)Transfer to deferred tax asset (1 337) (1 337) (1 337)Acquisition of treasury shares (25 742) (25 742) (25 742)Expensing of share-based payments forthe year 1 723 1 723 1 723Issue of shares at a premium 84 329 84 329 84 329Issue of debentures 4 605 4 605 4 605Restated balance as at 28 February 2005 84 437 405 438 858 – 2 803 (48 950) 52 409 496 995 23 535 520 530Net profit for the year 139 001 139 001 8 612 147 613Net ordinary dividends paid (21 330) (21 330) (4 103) (25 433)Adjustments to minority interest (4 430) (4 430)Increase in foreign currencytranslation reserve 497 497 497Transfer to deferred tax asset (1 338) (1 338) (1 338)Acquisition of treasury shares (30 500) (30 500) (30 500)Expensing of share-based payments forthe year 2 528 2 528 2 528Issue of shares at a premium 115 065 115 065 115 065Issue of debentures 7 207 7 207 7 207Balance as at 28 February 2006 199 502 523 109 17 – 5 331 (79 450) 59 616 708 125 23 614 731 739COMPANYBalance as at 1 March 2004 108 57 498 – 6 215 – – 54 053 117 874 – 117 874SA GAAP and IFRS adjustments (1 080) 1 080 – –Restated balance as at 1 March 2004 108 36 418 – 6 215 1 080 – 54 053 117 874 – 117 874Net profit for the year 42 755 42 755 42 755Expensing of share-based payments forthe year 1 723 1 723 1 723Net ordinary dividends paid (6 215) (6 215) (6 215)Issues of shares at a premium 84 329 84 329 84 329Issue of debentures 6 005 6 005 6 005Balance as at 28 February 2005 84 437 99 173 – – 2 803 – 60 058 246 471 – 246 471Net profit for the year 96 507 96 507 96 507Expensing of share-based payments forthe year 2 528 2 528 2 528Net ordinary dividends paid (23 901) (23 901) (23 901)Issue of shares at a premium 115 065 115 065 115 065Issue of debentures 7 507 7 507 7 507Balance as at 28 February 2006 199 502 171 779 – – 5 331 – 67 565 444 177 – 444 177ANNUAL REPORT 2006Totalequity

Reconciliation of previous SA GAAP to IFRSand restated SA GAAP57GroupCompanyIFRS transitionIFRS transition2005 2004 R’000 2005 2004Balance sheet522 338 387 270 Equity as previously reported – SA GAAP 246 525 117 874– – IFRS adjustments – –2 803 1 080Adoption of IFRS 2 – Introduction of capital reserve in respect ofshare-based payments 2 803 1 080(2 803) (1 080)Adoption of IFRS 2 – Retained income effect in respect of sharebasedpayments (2 803) (1 080)(1 808) (895) SA GAAP adjustments (54) –3 957 3 957 Property, plant and equipment depreciation adjustment – –(5 765) (4 852) Straight-lining of operating leases adjustment (54) –520 530 386 375 Restated equity – IFRS 246 471 117 874Income statement111 877 Profit attributable to linked unit holders of the parent – SA GAAP 44 532(1 723) IFRS adjustment (1 723)(1 723) Adoption of IFRS 2 – Share-based payments (1 723)(913) SA GAAP adjustments (54)(913) Straight-lining of operating leases adjustment (54)– Deferred tax impact on IFRS adjustments –109 241Restated profit attributable to equity holders ofthe parent – IFRS 42 755ASTRAPAK ANNUAL REPORT 2006

Cash flow statementsfor the year ended 28 February 20062006Group CompanyRestated2005 R’000 Notes 2006Restated2005Cash flows from operating activities327 843 283 577 Cash generated from operations A 58 755 25 8343 665 2 416 Interest received 11 642 12 166(33 881) (43 545)Interest paid (excluding interest distributionto linked unitholders) (10 509) (13 307)(20 527) (10 755) Net dividends (paid)/received 38 019 25 620(31 990) (39 308) Taxation paid B (2 886) (878)(6 608) (6 834) Interest distribution to linked unitholders (7 575) (7 727)238 502 185 551 Net cash inflow from operating activities 87 446 41 708Cash flows from investing activities– – Increase in investment in subsidiary companies (98 815) (63 049)(82 883) (17 505) Acquisition of subsidiary companies C – –1 012 804 Decrease in investment in joint ventures – –(183 863) (155 398) Additions to property, plant and equipment D (217) (313)(13 019) (36 616) Decrease in minority shareholders’ interest – –(7 625) (6 039)Goodwill on acquisition of minority shareholders’interests – –1 574 (11 358) Increase/(decrease) in investment and loans (3 798) 6 417– 12 500 Proceeds on disposal of investments – –6 819 11 977 Proceeds on disposal of plant and equipment E – 5(277 985) (201 634) Net cash outflow from investing activities (102 830) (56 940)Cash flows from financing activities– 27 Increase in share capital – 27115 064 84 302 Increase in share premium 115 065 84 3027 207 4 605 Increase in debentures 7 507 6 005(30 500) (25 742) Acquisition of treasury linked units – –– – Decrease in loans by Group companies (135 964) (33 908)(12 347) (38 725) Decrease in long-term liabilities – –(3 014) 7 926 (Decrease)/increase in short-term interest-bearing debt 6 932 (5 685)76 410 32 393 Net cash inflow/(outflow) from financing activities (6 460) 50 74136 927 16 310 Net increase/(decrease) in cash and cash equivalents (21 844) 35 50983 040 66 730 Cash and cash equivalents at the beginning of the year 52 955 17 446119 967 83 040 Cash and cash equivalents at the end of the year F 31 111 52 95558ASTRAPAKANNUAL REPORT 2006

Notes to the cash flow statementsfor the year ended 28 February 2006592006Group CompanyRestated2005 R’000 2006Restated2005A. CASH GENERATED FROM OPERATIONS184 472 148 465 Profit before taxation 94 093 41 533Adjustments for:– – Dividends received (61 921) (31 835)102 072 89 962 Depreciation 317 28018 4 666 Amortisation of goodwill and trademarks – –– (9 171) Profit on disposal of investments – –– 4 388 Impairment of assets – –1 773 (5 380) Loss/(gain) on disposal of property, plant and equipment – (5)494 1 251 Translation differences on investments and loans – –(3 530) (3 619) Share of results of associates and joint venture – –2 528 1 723 Equity accounted share option expenses 2 528 1 723(3 665) (2 416) Interest received (11 642) (12 166)40 865 49 428 Finance costs (including debenture interest distribution) 18 436 20 049325 027 279 297 Operating income before working capital changes 41 811 19 579Adjustments for working capital changes:(45 907) (44 479) Increase in inventories – –(16 834) 19 891 (Increase)/decrease in accounts receivable (13 187) 1 48265 557 28 868 Increase in accounts payable 30 131 4 7732 816 4 280 16 944 6 255327 843 283 577 58 755 25 834B. TAXATION PAID4 460 12 416 Amounts unpaid at the beginning of the year – –3 919 460 Taxation balances acquired – –29 283 30 892 Amounts charged to income statement 2 886 878(5 672) (4 460) Amounts unpaid at the end of the year – –31 990 39 308 2 886 878ASTRAPAK ANNUAL REPORT 2006

Notes to the cash flow statements (continued)for the year ended 28 February 2006Group Company2006Restated2005 R’000 2006Restated2005C. ACQUISITION OF SUBSIDIARY COMPANIESFair value of assets acquired61 651 10 817 Property, plant and equipment – –(11 292) (656) Deferred taxation – –(11 662) (6 026) Long-term liabilities – –23 466 7 480 Accounts receivable – –23 401 2 973 Cash resources – –12 325 4 460 Inventory – –(12 933) (7 429) Accounts payable – –(3 919) (460) Taxation – –(10 584) (2 873) Current portion of long-term liabilities – –(247) – Dividends payable – –21 – Investments – –(4 478) – Minority shareholders – –45 – Trademarks – –65 794 8 286 – –Less:(23 401) (2 973) Cash resources acquired – –Add:40 490 12 192 Goodwill on acquisition – –82 883 17 505 Cash outflow arising on acquisition – –D. ADDITIONS TO PROPERTY, PLANT AND EQUIPMENT168 898 151 819 Plant, equipment and furniture 217 2133 071 1 740 Motor vehicles – 8810 764 1 675 Leasehold improvements – 121 130 164 Land and buildings – –183 863 155 398 217 313The above-listed additions to property, plant andequipment consist of:166 026 118 525 Expansion – –17 837 36 873 Replacement 217 313183 863 155 398 217 313E. PROCEEDS ON DISPOSAL OFPLANT AND EQUIPMENT8 592 6 597 Net book value of disposals – –(1 773) 5 380 (Loss)/gain on disposal of property, plant and equipment – 56 819 11 977 – 5F. CASH AND CASH EQUIVALENTSAT THE END OF THE YEAR144 456 98 224 Cash and short-term investments 31 772 53 055(24 489) (15 184) Bank overdrafts (661) (100)119 967 83 040 31 111 52 95560ASTRAPAKANNUAL REPORT 2006

Accounting policiesfor the year ended 28 February 2006611. GENERAL INFORMATIONAstrapak Limited is a company incorporated underthe Companies Act of South Africa. The address of theregistered office is given on page 98. The nature of theGroup’s operations and its principal activities are set out onpages 6 to 11 and the operating and financial review onpages 21 to 31.These financial statements are presented in South AfricanRands because that is the currency of the primaryeconomic environment in which the Group operates.The financial statements have been prepared in accordancewith International Financial Reporting Standards (‘IFRS’) forthe first time.The impact of these changes in accounting policies isdiscussed in detail later in note 31. The impact on basic anddiluted earnings per share is disclosed in note 21.The adoption of these new and revised Standards andInterpretations has resulted in changes to the Group’saccounting policies in the following areas that haveaffected the amounts reported for the current or prior years:• share-based payments (IFRS 2);• goodwill (IFRS 3); and• property, plant and equipment (IAS 16).The financial statements have been prepared on thehistorical cost basis except for revaluation of certainfinancial instruments. The principal accounting policiesadopted are set out below.2. BASIS OF CONSOLIDATIONThe consolidated financial statements incorporate thefinancial statements of the Company and entities controlledby the Company (its subsidiaries) made up to 28 Februaryeach year. Control is achieved where the Company has thepower to govern the financial and operating policies of aninvestee entity so as to obtain benefits from its activities.On acquisition, the assets and liabilities and contingentliabilities of a subsidiary are measured at their fair valuesat the date of acquisition. The acquisition of subsidiariesis accounted for using the purchase method. Any excessof the cost of acquisition over the fair values of theidentifiable net assets acquired is recognised as goodwill.Any deficiency of the cost of acquisition below the fairvalues of the identifiable net assets acquired (i.e. discounton acquisition) is credited to profit and loss in the period ofacquisition. The interest of minority shareholders is stated atthe minority’s proportion of the fair values of the assets andliabilities recognised. Subsequently, any losses applicable tothe minority interest in excess of the minority interest areallocated against the interests of the parent.The results of subsidiaries acquired or disposed of duringthe year are included in the consolidated income statementfrom the effective date of acquisition or up to the effectivedate of disposal, as appropriate.Where necessary, adjustments are made to the financialstatements of subsidiaries to bring the accounting policiesused into line with those used by the Group.All intra-group transactions, balances, income and expensesare eliminated on consolidation.3. INVESTMENTS IN ASSOCIATESAn associate is an entity over which the Group is in aposition to exercise significant influence, but not controlor joint control, through participation in the financial andoperating policy decisions of the investee.The results and assets and liabilities of associates areincorporated in these financial statements using the equitymethod of accounting except when classified as held for sale,in which case it is accounted for under IFRS 5.Investments in associates are carried in the balance sheetat cost as adjusted by post-acquisition changes in theGroup’s share of the net assets of the associate, less anyimpairment in the value of individual investments. Lossesof the associates in excess of the Group’s interest in thoseassociates are not recognised.Any excess of the cost of acquisition over the Group’sshare of the fair values of the identifiable net assets ofthe associate at the date of acquisition is recognised asASTRAPAK ANNUAL REPORT 2006

Accounting policies (continued)for the year ended 28 February 2006goodwill. Any deficiency of the cost of acquisition belowthe Group’s share of the fair values of the identifiablenet assets of the associate at the date of acquisition (i.e.discount on acquisition) is credited in profit and loss in theperiod of acquisition.Where a Group company transacts with an associate of theGroup, profits and losses are eliminated to the extent ofthe Group’s interest in the relevant associate. Losses mayprovide evidence of an impairment of the asset transferred,in which case appropriate provision is made for impairment.4. JOINT VENTURESA joint venture is a contractual arrangement whereby theGroup and outside parties undertake an economic activity,which is subject to joint control.Joint venture arrangements undertaken in a separate entityare referred to as jointly-controlled entities. The Groupreports its interests in jointly-controlled entities using theequity method, in terms of which the post-acquisitionresults of the joint venture are included in the incomestatement.5. GOODWILLGoodwill arising on consolidation represents the excessof the cost of acquisition over the Group’s interest inthe fair value of the identifiable assets and liabilities of asubsidiary, associate or jointly-controlled entity at the dateof acquisition.Goodwill is initially recognised as an asset at cost andreviewed for impairment at least annually. Any impairmentis recognised immediately in profit or loss and is notsubsequently reversed.On disposal of a subsidiary, associate or jointly-controlledentity, the attributable amount of goodwill is included inthe determination of the profit or loss on disposal.Goodwill arising on acquisitions before the date oftransition to IFRS has been retained at the previousSouth African GAAP amounts, subject to being tested forimpairment at that date.Goodwill written off to share premium under South AfricanGAAP in 1998 has not been reinstated and is not includedin determining any subsequent profit or loss on disposal.6. REVENUE RECOGNITIONRevenue is measured at the fair value of the considerationreceived or receivable and represents amounts receivablefor goods and services provided in the normal course ofbusiness, net of trade discounts, VAT and other sales-relatedtaxes.Sales of goods are recognised when goods are deliveredand title has passed.Interest income is accrued on a time basis, by reference tothe principal outstanding and at the effective interest rateapplicable.Dividend income from investments is recognised whenthe shareholders’ rights to receive payment have beenestablished.7. LEASINGLeases are classified as finance leases whenever the termsof the lease transfer substantially all the risks and rewardsof ownership to the lessee. All other leases are classified asoperating leases.Assets held under finance leases are recognised as assetsof the Group at their fair value or, if lower, at the presentvalue of the minimum lease payments, each determinedat the inception of the lease. The corresponding liabilityto the lessor is included in the balance sheet as a financelease obligation. Lease payments are apportioned betweenfinance charges and reduction of the lease obligation soas to achieve a constant rate of interest on the remainingbalance of the liability. Finance charges are charged directlyagainst income, unless they are directly attributable toqualifying assets, in which case they are capitalised inaccordance with the Group’s general policy on borrowingcosts (see below).62ASTRAPAKANNUAL REPORT 2006

Accounting policies (continued)for the year ended 28 February 200663Rentals payable under operating leases are charged toincome on a straight-line basis over the term of the relevantlease.Benefits received and receivable as an incentive to enterinto an operating lease are also spread on a straight linebasis over the lease term.8. FOREIGN CURRENCIESTransactions in currencies other than South African Randsare recorded at the rates of exchange prevailing on thedates of the transactions. At each balance sheet date,monetary assets and liabilities that are denominated inforeign currencies are retranslated at the rates prevailingon the balance sheet date. Non-monetary assets andliabilities carried at fair value that are denominated inforeign currencies are translated at the rates prevailing atthe date when the fair value was determined. Gains andlosses arising on re-translation are included in net profit orloss for the period, except for exchange differences arisingon non-monetary assets and liabilities where the changesin fair value are recognised directly in equity.To hedge its exposure to certain foreign exchange risks, theGroup enters into forward contracts and options (see belowfor details of the Group’s accounting policies in respect ofsuch derivative financial instruments).9. BORROWING COSTSBorrowing costs directly attributable to the acquisition,construction or production of qualifying assets, which areassets that necessarily take a substantial period of timeto prepare for their intended use or sale, are added tothe cost of those assets, until such time as the assets aresubstantially ready for their intended use or sale. Investmentincome earned on the temporary investment of specificborrowings, pending their expenditure on qualifyingassets, is deducted from the borrowing costs eligible forcapitalisation.All other borrowing costs are recognised in profit or loss inthe period in which they are incurred.10. GOVERNMENT GRANTSGovernment grants are recognised as income over theperiods necessary to match them with the related costs.11. PROFIT FROM OPERATIONSProfit from operations is stated after the share of results ofassociates but before investment income and finance costs.12. RETIREMENT BENEFIT COSTSPayments to defined contribution retirement benefitschemes are charged as an expense as they fall due.13. IMPAIRMENT, EXCLUDING GOODWILLOn an annual basis, the Group reviews all assets, bothtangible and intangible, carried on the balance sheet forimpairment. Where the recoverable amount of an assetor cash-generating unit is estimated to be lower than itscarrying amount, its carrying amount is reduced to itsrecoverable amount. Impairment losses are charged againstincome in the period in which they are identified.Where an impairment loss subsequently reverses thecarrying amount of the asset or cash-generating unit isincreased to the revised estimate of its recoverable amount,such increase in carrying amount is limited to the orignialcost. A reversal of an impairment loss is recognised inincome in the period in which such reversal is identified.14. TAXATIONThe tax expense represents the sum of the tax currentlypayable and deferred tax.The tax currently payable is based on taxable profit for theyear. Taxable profit differs from net profit as reported in theincome statement because it excludes items of income orexpense that are taxable or deductible in other years and itfurther excludes items that are never taxable or deductible.The Group’s liability for current tax is calculated using taxrates that have been enacted or substantively enacted bythe balance sheet date.ASTRAPAK ANNUAL REPORT 2006

Accounting policies (continued)for the year ended 28 February 2006Deferred tax is the tax expected to be payable orrecoverable on differences between the carrying amountsof assets and liabilities in the financial statements andthe corresponding tax bases used in the computation oftaxable profit, and is accounted for using the balance sheetliability method.Deferred tax liabilities are generally recognised for alltaxable temporary differences and deferred tax assets arerecognised to the extent that it is probable that taxableprofits will be available against which deductible temporarydifferences can be utilised. Such assets and liabilities are notrecognised if the temporary difference arises from goodwillor from the initial recognition (other than in a businesscombination) of other assets and liabilities in a transactionthat affects neither the tax profit nor the accounting profit.Deferred tax liabilities are recognised for taxable temporarydifferences arising on investments in subsidiaries andassociates, and interests in joint ventures, except wherethe Group is able to control the reversal of the temporarydifference and it is probable that the temporary differencewill not reverse in the foreseeable future.The carrying amount of deferred tax assets is reviewed ateach balance sheet date and reduced to the extent that itis no longer probable that sufficient taxable profits will beavailable to allow all or part of the asset to be recovered.Deferred tax is calculated at the tax rates that are expectedto apply in the period when the liability is settled or theasset is realised. Deferred tax is charged or credited in theincome statement, except when it relates to items chargedor credited directly to equity, in which case the deferred taxis also dealt with in equity.15. PROPERTY, PLANT AND EQUIPMENTProperty, plant and equipment are accounted for at costless accumulated depreciation and any accumulatedimpairment. All direct costs, including finance costs relatingto major capital projects, are capitalised up to the date ofcommissioning.Depreciation is charged so as to write off the cost of assets,other than freehold land, over their estimated economicuseful lives, using the straight-line method. Depreciation isnot provided for on freehold land.Owner-occupied property, defined as property held for usein the supply of services or for administration purposes,is valued at cost less provisions for impairment of value,where appropriate. Depreciation is provided against thegross cost of the properties, taking into account the residualvalue and estimated life of the property.Residual values and estimated useful lives are assessed onan annual basis.The gain or loss arising on the disposal or scrapping ofproperty, plant and equipment is recognised in the incomestatement.16. TRADEMARKSTrademarks are measured initially at purchase cost andare amortised on a straight-line basis over their estimateduseful lives.17. INVENTORIESInventories are stated at the lower of cost and netrealisable value. Cost comprises direct materials and, whereapplicable, direct labour costs and those overheads thathave been incurred in bringing the inventories to theirpresent location and condition. Cost is calculated usingthe first-in first-out method. Net realisable value representsthe estimated selling price less all estimated costs ofcompletion and costs to be incurred in marketing, sellingand distribution.18. FINANCIAL INSTRUMENTSFinancial assets and financial liabilities are recognised onthe Group’s balance sheet when the Group has become aparty to contractual provisions of the instrument.Trade receivables and payables are measured at initialrecognition at fair value, and are subsequently measuredat amortised cost using the effective interest rate method.64ASTRAPAKANNUAL REPORT 2006

Accounting policies (continued)65Appropriate allowances for estimated irrecoverable tradepayables are recognised in profit or loss when there isobjective evidence that the asset is impaired.Cash and cash equivalents comprise the net of cash onhand and overdrafts, demand deposits, and other shorttermhighly liquid investments that are readily convertibleto a known amount of cash and are subject to aninsignificant risk of changes in value.Interest-bearing bank loans and overdrafts are recordedat the proceeds received, net of direct issue costs. Financecharges, including premiums payable on settlement orredemption, are accounted for on an accrual basis to theincome statement using the effective interest rate methodand are added to the carrying amount of the instrument tothe extent they are not settled in the period in which theyarise.Equity instruments are recorded at the proceeds received,net of direct issue costs.The Group uses derivative financial instruments, primarilyforeign currency forward contracts, to hedge its risksassociated with foreign currency. The Group does not usederivative financial instruments for speculative purposes.The fair value of these derivatives is recorded andremeasured at each reporting date.Changes in fair value of derivative financial instrumentsthat are designated and effective as hedges of futurecash flows relating to firm commitments and forecastedtransactions are recognised directly in equity. If the hedgedfirm commitment or forecast transaction results in therecognition of an asset or a liability, then, at the time theasset or liability is recognised, the associated gain or losson the derivative that had previously been recognised inequity is included in the initial measurement of the asset orliability.Hedge accounting is discontinued when the hedginginstrument expires or is sold, terminated, exercised orno longer qualifies for hedge accounting. At that time,any cumulative gain or loss on the hedging instrumentrecognised in equity is retained in equity until theforecast transaction occurs. If a hedged transaction is nolonger expected to occur, the net cumulative gain or lossrecognised in equity is transferred to net profit or loss forthe period.Changes in fair value of derivative financial instruments thatdo not qualify for hedge accounting are recognised in theincome statement as they arise.19. PROVISIONSProvisions are raised when a present obligation exists asa result of a past event and it is probable that an outflowof resources will be required to settle the obligation, anda reliable estimate can be made of the amount of theobligation.20. SHARE-BASED PAYMENTSThe Group has applied the requirements of IFRS 2 SharebasedPayments. In accordance with the transitionalprovisions, IFRS 2 has been applied to all grants of equityinstruments after 7 November 2002 that were unvested asof 1 March 2005.The Group issues equity-settled share-based payments tocertain employees.Equity-settled share-based payments are measured at fairvalue at the date of grant. The fair value determined at thegrant date of the equity-settled share-based payments isexpensed on a straight-line basis over the vesting period,based on the Group’s estimate of shares that will eventuallyvest.Fair value is measured by use of a binomial model. Theexpected life used in the model has been adjusted,based on management’s best estimate, for the effects ofnon-transferability, exercise restrictions, and behaviouralconsiderations.ASTRAPAK ANNUAL REPORT 2006

Accounting policies (continued)for the year ended 28 February 200621. SEGMENTAL REPORTINGFor management purposes, the Group is organised intobusiness clusters on the basis of operational types. Theseclusters are the basis on which the Group reports its primarysegment information. The principal activities of the clustersare as follows:• FilmsManufacturers of high-density polyethylene films, lowdensitysingle- and multi-layered films, plain and printedfilms, co-extruded film, blown film, film for pallet stretchwrap and industrial pallet shrink shroud.22. HEADLINE EARNINGS PER LINKED UNITThe Group has followed the recommendation contained inCircular 7/2002 Headline Earnings issued by SAICA and haspublished headline earnings per linked unit in addition toattributable earnings per linked unit. Headline earnings perlinked unit have been calculated in accordance with therequirements of Circular 7/2002. Attributable profit per linkedunit has been based on earnings attributable, includinginterest, to linked unitholders.• RigidsManufacturers of plastic closures for rigid containers andjars, clear packaging containers, industrial cores, tubesand composite cans, paper edgeboard used for palletstabilisation, and blow-moulding and decoration of rigidplastic containers and jars.• FlexiblesManufacturers of high-tech polyethylene stretch labels,PVC shrink labels, wraparound polypropylene labels,tamper-evident seals, decorated stand-up pouches andconverters and distributors of specialist printed mono- andcomposite films.In addition, the businesses are grouped by geographicallocation. The main geographic regions identified are:• Gauteng;• Cape; and• KwaZulu-Natal.Geographic split is determined by location of the operatingassets.66ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statementsfor the year ended 28 February 200667R’000LandandbuildingsPlant,equipmentand furnitureMotorvehiclesLeaseholdimprovementsTotal1. PROPERTY, PLANT AND EQUIPMENTGroup 2006CostBalance at the beginning of the year 68 585 828 952 11 730 9 242 918 509Additions 1 130 168 898 3 071 10 764 183 863Acquisition of business – 103 539 3 378 – 106 917Disposals – (69 538) (1 410) – (70 948)Balance at the end of the year 69 715 1 031 851 16 769 20 006 1 138 341Accumulated depreciationBalance at the beginning of the year 21 122 403 504 7 993 4 919 437 538Acquisition of business – 43 719 1 547 – 45 266Charge for the year 2 963 95 335 2 272 1 502 102 072Depreciation on disposals – (62 360) 4 – (62 356)Balance at the end of the year 24 085 480 198 11 816 6 421 522 520Net book value at 28 February 2006 45 630 551 653 4 953 13 585 615 821Restated net book value at 28 February 2005 47 463 425 448 3 737 4 323 480 971Group 2005CostBalance at the beginning of the year 74 277 661 698 11 266 7 567 754 808Additions 164 151 819 1 740 1 675 155 398Acquisition of business – 22 547 1 112 – 23 659Disposals (5 856) (7 112) (2 388) – (15 356)Balance at the end of the year 68 585 828 952 11 730 9 242 918 509Accumulated depreciationBalance at the beginning of the year 19 840 312 112 7 461 4 080 343 493Acquisition of business – 12 227 615 – 12 842Charge for the year 3 162 84 610 1 351 839 89 962Depreciation on disposals (1 880) (5 445) (1 434) – (8 759)Balance at the end of the year 21 122 403 504 7 993 4 919 437 538Restated net book value at 28 February 2005 47 463 425 448 3 737 4 323 480 971Restated net book value at 29 February 2004 54 437 349 586 3 805 3 487 411 315ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006R’000 CostAccumulateddepreciationNet bookvalue68ASTRAPAK1. PROPERTY, PLANT AND EQUIPMENT (continued)Reconciliation of net book value at 28 February 2006Land and buildings 69 715 24 085 45 630Plant, equipment and furniture 1 031 851 480 198 551 653Motor vehicles 16 769 11 816 4 953Leasehold improvements 20 006 6 421 13 5851 138 841 522 520 615 821R’000MotorvehiclesPlant,equipmentand furnitureLeaseholdimprovementsCompany 2006CostBalance at the beginning of the year 88 1 389 346 1 823Additions – 217 – 217Balance at the end of the year 88 1 606 346 2 040Accumulated depreciationBalance at the beginning of the year 15 689 143 847Charge for the year 17 246 54 317Balance at the end of the year 32 935 197 1 164Net book value at 28 February 2006 56 671 149 876Net book value at 28 February 2005 73 700 203 976Company 2005CostBalance at the beginning of the year – 1 179 334 1 513Additions 88 213 12 313Disposals – (3) – (3)Balance at the end of the year 88 1 389 346 1 823Accumulated depreciationBalance at the beginning of the year – 487 83 570Charge for the year 15 205 60 280Disposals – (3) – (3)Balance at the end of the year 15 689 143 847Net book value at 28 February 2005 73 700 203 976Net book value at 29 February 2004 – 692 251 943AccumulateddepreciationANNUAL REPORT 2006TotalNet bookvalueR’000 CostReconciliation of net book value at 28 February 2006Motor vehicles 88 32 56Plant, equipment and furniture 1 606 935 671Leasehold improvements 346 197 1492 040 1 164 876Assets are encumbered as detailed in note 14.Details of land and buildings are included in annexure 1.Assets held under finance lease are depreciated over the lesser of the expected useful life or the term of the related lease.Plant and equipment8 yearsFurniture and computer equipment3 to 5 yearsMotor vehicles5 yearsLeasehold improvements5 yearsBuildings20 yearsTrademarks3 to 5 years

Notes to the annual financial statements (continued)for the year ended 28 February 2006692006Group CompanyRestated2005 R’000 2006Restated20052. GOODWILL42 086 28 521 Balance at the beginning of the year – –Purchases during the year:7 625 6 039 • minority interests purchased – –24 209 – • acquisition of 100% of Hilfort Plastics – –16 281 – • acquisition of 60% of Consupaq – –– 2 347 • acquisition of 50% of Marcom Plastics – –– 9 845 • acquisition of 70% of Knilam Packaging– (4 666) Amortisation for the year – –90 201 42 086Cost after elimination of amortisation accumulated prior tothe adoption of IFRS 3 – –Reconciliation of net goodwill as at 28 February90 201 56 509Cost (2006: after elimination of amortisation accumulatedprior to the adoption of IFRS 3) – –– (14 423) Accumulated amortisation – –90 201 42 086 Net carrying value – –3. TRADEMARKS45 – Acquisition of 60% of Consupaq – –(18) – Amortisation for the year – –27 – Total – –Reconciliation of net trademarks as at 28 February45 – Cost – –(18) – Accumulated amortisation – –27 – Net carrying value – –4. DEFERRED TAX83 247 26 901Accelerated wear and tear for tax purposeson plant and equipment – –(4 823) 22 927 Other temporary differences – –(41 017) (32 111) Estimated tax losses (12 037) (6 737)37 407 17 717 Net deferred tax liability/(asset) (12 037) (6 737)Reconciliation betweeen deferred tax openingand closing balances:17 717 13 268 Net deferred tax liability/(asset) at the beginning of the year (6 737) (4 637)(8 906) (9 945) Increase of tax losses (5 300) (2 100)56 346 15 209Net originating temporary differenceson plant and equipment – –1 338 1 337 Transfer from non-distributable reserve (note 11) – –(29 088) (2 152) Other temporary differences – –37 407 17 717 Net deferred tax liability/(asset) at the end of the year (12 037) (6 737)Analysed between:(41 017) (32 111) Deferred tax assets (12 037) (6 737)78 424 49 828 Deferred tax liabilities – –37 407 17 717 Net deferred tax liability/(asset) at the end of the year (12 037) (6 737)ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200670ASTRAPAK2006Group CompanyRestated2005 R’000 20065. INVESTMENTS AND LOANSInvestmentsUnlistedANNUAL REPORT 2006Restated2005Investment in label printing Mauritian Joint Venture(49,5% interest held) – –7 452 5 441776 776 Investment to date at cost – –14 494 11 578 Equity accounted profit to date (after tax) – –(5 533) (4 520) Dividends received to date – –(2 285) (2 393) Foreign exchange translation differences to date – –10 949 057 (2005: 12 500 125) cumulative redeemablepreference shares at R1 each in Really Useful InvestmentsNo 43 (Pty) Ltd – –9 589 11 28317 041 16 724 – –Listed28 – First Rand Limited (1 505 ordinary shares) – –3 – Sanlam Limited (499 ordinary shares) – –8 – Old Mutual Limited (700 ordinary shares) – –39 – – –17 080 16 724 Total investments – –Loans– – Loan to/(from) Astrapak Property Development (Pty) Limited 6 620 (2 112)– – Loan to Astrapak Limited Linked Unit Trust Scheme 41 124 46 058The loans are non-interest bearing, unsecured and haveno fixed terms of repayment17 080 16 724 Total 47 744 43 94617 041 16 724 Directors’ valuation of unlisted investments – –50 – Market value of listed investments – –Included in the financial results of the Mauritian JointVenture, Standard Labels Limited, at 28 February is:13 901 14 376 Current assets8 028 8 983 Non-current assets4 118 5 483 Current liabilities9 783 5 183 Non-current liabilities21 697 19 300 Revenue12 930 11 134 Retained profit for the year6. INVESTMENT IN ASSOCIATE COMPANY177 75 Unlisted – Izakhamzi Plastics (Pty) Ltd (20% interest held) – –4 970 3 940 Current assets – –563 583 Non-current – –3 681 3 223 Current liabilities – –444 400 Non-current liabilities – –20 946 23 898 Revenue – –177 75 Equity accounted profit to date – –177 75 Directors’ valuation of unlisted investment – –7. INVESTMENT IN SUBSIDIARIES– – Shares at cost 384 761 285 945– – Indebtedness 7 693 (128 271)– – Total 392 454 157 674– – Directors’ valuation 392 454 157 674Refer note 29 for further detailsInventories amounting to R485 981 (2005: R857 716) are carried at net realisable value.

Notes to the annual financial statements (continued)for the year ended 28 February 2006712006Group CompanyRestated2005 R’000 2006Restated20058. INVENTORIES114 667 79 174 Raw materials – –31 006 24 866 Work in progress – –87 393 74 158 Finished goods – –12 126 8 762 Consumable stores – –245 192 186 960 Total – –9. ACCOUNTS RECEIVABLE268 182 239 744 Trade receivables – –(8 903) (10 420) Less: Provision for bad debts – –259 279 229 324 – –11 180 10 387 Prepayments 128 –20 724 11 172 Other (including VAT receivable, deposits, etc) 13 557 498291 183 250 883 Total 13 685 49810. SHARE CAPITAL AND SHARE PREMIUMAuthorised share capitalOrdinary share capital200 185200 000 000 (2005: 184 985 417)shares of 0,1 cent per share 200 185Deferred ordinary share capital– 15 Nil (2005: 15 014 583) shares of 0,1 cent per share – 15Issued share capitalOrdinaryshares of 0,1 centper shareNumberof shares R’000Deferred ordinaryshares of 0,1 centper shareNumberof shares R’000SharepremiumR’000Balance at the beginning of the year 120 116 667 120 15 014 583 15 84 302Conversion of deferred ordinary sharesissued during the year at a premium 15 014 583 15 (15 014 583) (15) 117 556135 131 250 135 – – 201 858Less: Share issue expenses – – – – (2 491)Balance at the end of the year 135 131 250 135 – – 199 367Group Company2006 2005 R’000 2006 200511. NON-DISTRIBUTABLE RESERVES858 2 878 Balance at the beginning of the year – –(841) (2 020) Movements in non-distributable reserves – –17 858 Balance at the end of the year – –Comprising:1 336 2 673Non-distributable reserve created in previous years as aresult of a change in accounting policy relating to theamortisation of intangible assets – –(1 319) (1 815) Foreign currency translation reserve – –17 858 – –ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20062006Group CompanyRestated2005 R’000 2006Restated200512. TREASURY LINKED UNITS39 648 41 35812 085 006 (2005: 14 327 000) linked unitsregistered in the name of the Astrapak LimitedLinked Unit Trust Scheme – –39 802 7 5923 814 132 (2005: 971 125) linked units purchasedby nominee – –79 450 48 950 – –13. DEBENTURESAuthorised100 000 100 000200 000 000 unsecured variable rate redeemabledebentures of 50 cents each 100 000 100 000Issued67 565 60 058135 131 250 (2005: 120 116 667) unsecured variablerate redeemable debentures of 50 cents each 67 565 60 058(6 042) (7 164)12 085 006 (2005: 14 327 000) unsecured variable rateredeemable debentures of 50 cents each held in treasurylinked units – –(1 907) (485)3 814 132 (2005: 971 125) unsecured variable rateredeemable debentures of 50 cents each held by nominee – –59 616 52 409 67 565 60 05814. INTEREST-BEARING DEBT AND CASH14.1 Long termSecured debt183 539 147 826 Instalment sale agreements (variable rate) – –Other variable rate loans:7 215 1 063 • monthly instalments 6 932 –Other fixed rate loans:2 257 10 451 • quarterly instalments – –49 045 75 833 • bi-annual instalments – –242 056 235 173 Total secured debt 6 932 –(97 685) (90 115)Current portion transferred to short-terminterest-bearing debt (6 932) –144 371 145 058 Net long-term interest-bearing debt – –The instalment sale agreements and other variable rate loans are secured by the related property, plant and equipment with net bookvalues of R193 337 718 (2005: R177 486 893). Refer note 1.Variable rate loansThese loans bear interest at variable money market rates ruling at the roll-over dates. Redemption is reviewed and rolled forward. Securityis provided by the underlying property and cession of key man insurance policies.Fixed rate loansThe loan repayable in quarterly instalments bears interest at 11,85% per annum, and is repayable at R2 292 322 per quarter.The loan repayable in bi-annual instalments bears interest at 16% per annum, and is repayable in bi-annual instalments of R18 855 416.The fixed rate loans are secured by a group security pooling arrangement over the assets of the business.The directors consider the carrying amounts of all loans to approximate their fair values.72ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200673Group Company2006 2005 R’000 2006 200514. INTEREST-BEARING DEBT AND CASH (continued)14.1 Long term (continued)Analysis of repaymentsRepayable during the twelve months to:– 90 115 28 February 2006 – –97 685 98 651 28 February 2007 6 932 –96 208 31 090 29 February 2008 –26 253 10 594 28 February 2009 – –15 479 5 123 28 February 2010 – –6 431 – Thereafter – –242 056 235 173 Total repayments 6 932 –14.2 Short-term interest-bearing debt24 488 15 184 Bank overdrafts 661 10097 685 90 115 Current portion of long-term interest-bearing debt 6 932 –122 173 105 299 7 593 100(144 456) (98 224) 14.3 Cash and short-term investments (31 772) (53 055)14.4 Net interest-bearing debt/(cash)144 371 145 058 Long-term interest-bearing debt – –122 173 105 299 Short-term interest-bearing debt 7 593 100(144 456) (98 224) Cash and short-term investments (31 772) (53 055)122 088 152 133 (24 179) (52 955)The Group evaluated numerous capital allocation opportunities during the year under review and invested to achieve an optimal resultfor linked unitholders. The opportunities that were pursued were funded partly by debt and partly by the cash generated from within theGroup. This resulted in a net interest-bearing debt of R122,1 million (2005: R152,1 million). The major capital allocations were as follows:• R183,4 million for plant replacement as well as expansionary capital expenditure;• R13,0 million for the purchase of certain minority interests; and• R82,9 million for the purchase of subsidiaries.Where possible the effect of these capital allocations on headline earnings has been disclosed in note 21 of the report. In accordancewith the provisions of the Articles of Association adopted by the Company on 17 September 1997, the borrowing powers of the directorsare unlimited.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20062006Group CompanyRestated2005 R’000 2006Restated200515. ACCOUNTS PAYABLE223 671 177 624 Trade payables – –96 943 57 456 Accruals 35 516 7 303320 614 235 080 Total 35 516 7 303R’000 RoyaltiesLeavepay BonusesDistributorcommissionsCreditnotes Other Total200616. PROVISIONS – GROUPOpening balance – 6 701 16 285 5 261 2 070 11 579 41 896Additions 57 8 802 17 405 940 1 404 7 293 35 901Usage – (6 701) (16 285) (5 261) (2 070) (11 579) (41 896)Closing balance 57 8 802 17 405 940 1 404 7 293 35 901PROVISIONS – COMPANYOpening balance – 244 2 026 – – – 2 270Additions – 201 3 987 – – – 4 188Usage – (244) (2 026) – – – (2 270)Closing balance – 201 3 987 – – – 4 188Other provisions consist of provisions for repairs and maintenance, volume discounts andsettlement discounts. All the provisions are expected to be utilised in full during the nextfinancial year.Group CompanyRestated2005 R’000 2006Restated200517. TRADING INCOMETrading income has been determined after taking intoaccount the items detailed below:Income:1 430 132 Government grants – –641 586 Foreign exchange gains – –– 5 380 Net gain on disposal of property, plant and equipment 5– 9 171 Profit on disposal of investments – –372 – Reversal of write-down of inventory to net realisable value – –Expenses:Auditors’ remuneration2 315 1 536 • audit fees 269 106100 24 • prior year under provision – –149 42 • tax advisory services – –– 658 Write-down of inventory to net realisable value – –2 564 1 602 269 10674ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006752006Group CompanyRestated2005 R’000 2006Restated200517. TRADING INCOME (continued)Directors’ emolumentsNon-executive directors• Number of non-executive directors 5 5• Fees for services as a director 510 375• Fees for services as committee members 195 200• Fees for consulting services 851 9731 556 1 548Executive directors• Number of executive directors 6 6• Basic remuneration 8 061 6 101• Bonus and performance-related payments 4 195 1 992• Contributions to retirement and medical aid funds 60 59• Other incentives and benefits 809 80913 125 8 961Less: Paid by subsidiary and non-subsidiary companies (13 125) (8 961)– –(Refer to the remuneration report on pages 46 to 48 for a further analysis ofaggregate remuneration and benefits paid to executive and non-executive directors.)– 4 666 Amortisation of goodwill – –18 – Amortisation of trademarks – –– 4 388 Impairment of assets – –1 773 – Net loss on disposal of property, plant and equipment – –Depreciation –2 963 3 162 • Land and buildings – –95 335 84 610 • Plant, equipment and furniture 246 2052 272 1 351 • Motor vehicles 17 151 502 839 • Leasehold improvements 54 60102 072 89 962 317 2802 510 3 298 Foreign exchange losses –Operating lease charges22 479 19 274 • Land and buildings 679 5961 850 711 • Plant, equipment and motor vehicles 50 81153 138 • Other – –24 482 20 123 729 677Staff costs296 583 261 930 • Salaries and wages 14 481 12 61017 285 16 918 • Pension and provident fund costs 1 164 86610 516 9 287 • Other 244 2123 195 2 991 Number of employees 13 12ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006R’000Net profitbeforetaxationTaxationMinorityinterestsNetprofit18. EXCEPTIONAL ITEMSThe exceptional items consist of:Group 2005:Surplus on replacement of destroyedplant and equipment from the insuranceclaim relating to the fire that occurredat Plastop (Proprietary) Limited,Bronkhorstspruit on 1 August 2003 8 000 (208) – 7 792Gain on disposal of empowermentshareholding in PAK 2000 9 171 (1 271) – 7 900Non-recurring costs incurred in respectof the sinkhole at Cinqpet (Pty) Ltd’sfactory (4 388) – 219 (4 169)12 783 (1 479) 219 11 5232006Group CompanyRestated2005 R’000 2006Restated200519. NET INVESTMENT INCOME/(FINANCE COSTS)(33 881) (43 545) Interest paid (excluding debenture interest distribution) (10 509) (13 307)(6 984) (5 883) Debenture interest distribution (7 927) (6 742)3 665 2 416 Interest received 11 642 12 166(37 200) (47 012) (6 794) (7 883)76ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200677Group Company2006Restated2005 R’000 2006Restated200520. TAXATION26 083 27 696 Current tax – Current year – –– 1 839 – Capital gains tax – –7 576 2 484 Deferred taxation (5 300) (2 100)3 200 1 377 Secondary tax on companies 2 886 87836 859 33 396 Total (2 414) (1 222)%Reconciliation of rate of taxation29,0 30,0 South African normal tax rate on companies 29,0 30,0– (0,1) • Change in tax rate – –0,1 0,1 • Tax rate difference in respect of trusts – –(2,2) (1,1) • Incentive allowances – –3,8 7,7 • Disallowable expenses – –(10,4) (12,5) • Non-taxable income (34,7) (34,8)(2,0) (1,3) • Prior year losses utilised – –– (1,2) • Capital gains tax – –1,7 0,9 • Secondary tax on companies 3,1 2,020,0 22,5 Effective rate of taxation (2,6) (2,8)R’000Tax losses201 385 139 788 Estimated tax losses available to offset future profits 101 452 63 46059 945 40 229Tax losses against which no deferred taxation asset wasraised 59 945 40 229ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006Group2006Restated2005 R’00021. EARNINGS AND HEADLINE EARNINGSPER LINKED UNIT (CENTS)122,5 121,0 Earnings per linked unit (cents)116,6 114,8 Net profit attributable to linked unitholders5,9 6,2 Debenture interest125,5 123,8Prior to IFRS and other adjustments, earnings per linkedunit would have been reflected as125,9 116,6 Headline earnings per linked unit (cents)120,0 110,4 Net headline earnings attributable to linked unitholders5,9 6,2 Debenture interest128,8 119,3Prior to IFRS and other adjustments, earnings per linkedunit would have been reflected as111,8 105,5 Earnings per linked unit – fully diluted (cents)105,9 99,3 Attributable income5,9 6,2 Debenture interest114,3 100,8 Headline earnings per linked unit – fully diluted (cents)108,4 94,6 Attributable income5,9 6,2 Debenture interest119 187 95 158 Weighted average number of linked units in issue (000)131 272 110 018Weighted average number of linked units inissue – fully diluted (000)Number of shares119 187 95 158Weighted average number of ordinary shares for thepurposes of basic earnings per share12 085 14 860 Effect of dilutive potential ordinary shares – share options131 272 110 018Weighted average number of ordinary shares for thepurposes of diluted earnings per shareReconciliation between attributableprofit and headline earnings139 001 109 241 Net profit attributable to linked unitholders6 984 5 883 Distribution to linked unitholders – debenture interestAmortisation of goodwill relating to acquisitions– 4 666 after 15 June 2000, before 31 March 20041 773 (5 380) Loss/(profit) on disposal of property, plant and equipment– (9 171) Profit on disposal of 25% investment in PAK 20002 289 (41) Exercise of options– 4 388 Sinkhole costs(71) 1 437 Tax effect(2) (127) Attributable to minorities149 974 110 896 Headline earnings attributable to linked unitholdersHeadline earnings per linked unit increased by 7,98% to 125,9 cents. The increase was attributable to increased volumes, improvedmargins and greater efficiencies.78ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20067922. DISTRIBUTION POLICYThe profits available for distribution by way of debenture interest and dividends(‘distributable profits’) will be covered approximately three times by after tax-earnings beforedebenture interest.Debenture interestDebenture interest will be calculated at the lower of:• the prime rate of interest of the face value of the debentures; and• the distributable profits.2006Dividend policyThe dividend policy will be to declare and pay the excess of the distributable profits, ifany, over the debenture interest. The distribution policy will be reviewed by the Board ofDirectors of Astrapak from time to time, in light of prevailing circumstances and future cashrequirements.Group CompanyRestated2005 R’000 2006Restated200523. CAPITAL COMMITMENTS21 265 19 641 Authorised, contracted not spent – –Capital commitment funding will be sourced fromcash generated from operations or other financingarrangements as required.24. LEASE COMMITMENTSOperating leases18 775 12 919 • due within one year 118 62476 238 51 667 • due thereafter – 28795 013 64 586 Total 118 91125. RETIREMENT BENEFITSWith effect from 1 March 1999, the Astrapak Provident and Astrapak Pension Funds wereestablished for the purpose of consolidating the Group’s funds, by transferring all employeesin the Group onto the Astrapak Provident and Pension Funds. All the funds are definedcontribution funds as governed by the Pension Funds Act, 1956 (Act no 26 of 1956).All eligible employees are members of either the Astrapak Provident and Pension Funds, orare members of funds within the various industries in which they are employed.The assets of the funds, at 28 February 2005, are held in administered trust funds, separatefrom the Group’s assets, and are administered by various pension fund administrators.The cost of retirement benefits charged to the income statement during the financial periodunder review amounts to R17 284 897 (2005: R16 918 170).26. CONTINGENT LIABILITIESThe Group has no material contingent liabilities. The Company has contingent liabilitiesin respect of guarantees issued to bankers and other creditors for normal businesscommitments of subsidiaries.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200627. FINANCIAL RISK MANAGEMENTThe Group purchases financial instruments in order to finance its operations and to manage the interest rate and currency risks thatarise from normal business operations. In addition, financial balances, for example, trade debtors, trade creditors, bank balances,accruals and prepayments arise from normal business operations within the Group.The Group finances its operations mainly through retained profits, bank credit borrowings and long-term bank loans.The Group also enters into derivative transactions, principally, forward currency contracts, forward rate agreements and interest rateswaps in order to manage currency and interest rate risks that may arise.The risk areas the Group is exposed to are credit risk, treasury risk, interest rate risk, liquidity risk and foreign currency risk. Compliancewith the Group’s policies is reviewed at Executive Committee meetings. These policies have remained unchanged throughout theyear ended 28 February 2006.Treasury risk managementThe Group’s treasury risk is managed through the Executive Committee reporting to the Board of Directors. One of the roles of thiscommittee is to decide the appropriate philosophy to be adopted within the Group regarding the management of treasury risksand for considering and managing the Group’s existing financial market risks by adopting strategies within the guidelines set by theBoard.Interest rate risk managementInterest rate risk is the possibility that the Group may suffer financial loss if either a fluctuating interest rate or fixed interest rateposition is entered into and interest rates move adversely. The Group uses swaps, options, forward rate arrangements and otherstandard market instruments to manage this risk. The risk profile of financial liabilities and assets at balance sheet date is detailedbelow, which excludes short-term receivables and non-interest bearing short-term payables:R’000Floating rateassetsFixed rateliabilitiesFloating rateliabilitiesNetliabilitySouth African Rand (144 456) 51 302 190 754 122 088Total at 28 February 2006 (144 456) 51 302 190 754 122 088South African Rand (98 224) 86 284 164 073 152 133Total at 28 February 2005 (98 224) 86 284 164 073 152 13380ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20068127. FINANCIAL RISK MANAGEMENT (continued)Liquidity risk managementLiquidity risk is the possibility that the Group may suffer financial loss through liquid funds not being available or that excessivefinance costs must be paid to obtain funds to meet payment requirements. The Group manages this risk through forecasting andmonitoring cash flow requirements on a regular basis, and by maintaining sufficient undrawn facilities. Significant liquid resourceswere held at year-end. The Group had the following undrawn facilities available at the balance sheet date:RestatedR’000 20062005Expiry period at 28 FebruaryWithin one year 139 614 149 380Within two to five years 90 005 250 017229 619 399 397The facilities expiring within one year are of a general banking nature and thus subject to review at various dates (usually on anannual basis), and it is expected that this profile will continue.The facilities expiring beyond two years are of a project and structured finance nature, and are utilised primarily to finance capital expenditure.Foreign currency risk managementForeign currency risk is the risk that the Group may suffer financial loss as a consequence of depreciation in a reporting currencyrelative to a foreign currency prior to payment of a commitment in that foreign currency, or of the reporting currency strengtheningprior to receiving payment in that foreign currency.The Group has transactional exposures in currencies other than South African Rands. These exposures arise from sales, or purchases,of inventory and capital expenditure.The Group uses swaps, options and other financial instruments, in particular forward contracts, to manage transactional currencyrisks. Specific translation risks are managed through the Group’s individual operating units. Speculative positions are not permitted.All imports and exports are fully covered at balance sheet date. The values of forward contracts entered into at 28 February are:R’000Averagecontract rate 2006Restated2005US Dollars 6,28 5 324 21Euro 11,1239 12 414 4 546UK Pounds 7,588 829 318 567 4 570Spot rate at 28 FebruaryUS Dollars 6,1659 5,8888Euro 7,3134 7,8358UK Pounds 10,7274 11,3865Credit risk managementPotential concentrations of credit risk consist principally of cash investments and trade receivables. The Group only deposits cashsurpluses with major banks of high standing.Trade receivables comprise a large, widespread customer base. Ongoing credit evaluations on the financial condition of customersare performed and, where appropriate, credit guarantee insurance cover is purchased or provisions made.The Group does not consider there to be any significant concentration of credit risk that had not been insured or adequatelyprovided for at balance sheet date.An allowance is made for impairment where there is an identified loss event which, based on previous experience, is evidence of areduction in the recoverability of the cash flows.Fair value of financial instrumentsThe carrying amounts reported in the balance sheet for liquid resources, trade and other receivables and trade payables approximatefair value.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006R’000 Films Rigids Flexibles Group28. SEGMENTAL ANALYSIS28.1 Business segment report (primary report)Revenue – 2006 809 752 739 535 324 675 1 873 962Revenue – 2005 774 623 608 853 266 751 1 650 227Trading income – 2006 63 261 116 017 42 392 221 670Trading income – 2005 64 752 91 842 26 100 182 694Depreciation – 2006 22 669 67 196 12 207 102 072Depreciation – 2005 28 986 48 817 12 159 89 962Capital expenditure – 2006 67 026 100 550 16 287 183 863Capital expenditure – 2005 24 826 116 563 14 009 155 398Total assets – 2006 629 997 627 047 198 195 1 455 239Total assets – 2005 464 449 481 906 166 173 1 112 528Total liabilities – 2006 370 103 240 553 112 844 723 500Total liabilities – 2005 292 311 204 457 95 230 591 998R’000 GautengKwaZulu-Natal Cape Group28.2 Geographical report (secondary report)Revenue – 2006 984 846 484 075 405 041 1 873 962Revenue – 2005 949 814 421 185 279 228 1 650 227Trading income – 2006 84 395 71 295 65 980 221 670Trading income – 2005 103 922 56 529 22 243 182 694Depreciation – 2006 62 052 17 095 22 925 102 072Depreciation – 2005 58 690 18 152 13 120 89 962Capital expenditure – 2006 99 647 40 957 43 259 183 863Capital expenditure – 2005 125 100 17 843 12 455 155 398Total assets – 2006 838 805 302 947 313 487 1 455 239Total assets – 2005 736 578 225 435 150 515 1 112 528Total liabilities – 2006 418 907 172 769 131 824 723 500Total liabilities – 2005 390 901 128 642 72 455 591 99882ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200683IssuedsharecapitalREffectivepercentage holding2006%Restated2005%Amount owingby/(to) subsidiary2006R’000Restated2005R’000Cost ofinvestment2006R’000Restated2005R’00029. ANALYSIS OF INTEREST IN SUBSIDIARYCOMPANIESSubsidiaries all incorporated inthe Republic of South Africa29.1 Directly heldAstrapak Finance Company (Pty) Ltd (1) 100 100 100 69 233 56 424 53 000 53 000Astrapak Gauteng (Pty) Ltd 100 100 100 (39 746) (131 244) – –Astrapak KwaZulu-Natal (Pty) Ltd 100 100 100 (24 111) (52 337) – –Astrapak Properties (Pty) Ltd (2) 100 100 100 1 727 2 047 – –Astrapak Western Cape (Pty) Ltd 100 100 100 28 169 15 265 – –International Edgeboard Technology (Pty) Ltd 100 100 100 471 871 – –Master Plastics (Pty) Ltd 563 100 95 13 580 13 055 181 939 169 608Astrapak Property Development (Pty) Ltd (2) 100 100 100 – – – –Hilfort Plastics (Pty) Ltd 120 000 100 – 58 – 83 526 –Indirectly heldAstra Repro (Pty) Ltd 100 80 80 230 (1 214) – –Astraflex (Pty) Ltd 100 100 100 41 089 34 793 – –Astrapak Exports (Pty) Ltd 100 100 100 (136) – – –Barrier Film Converters (Pty) Ltd 1000 100 80 4 256 11 669 – –Consupaq (Pty) Ltd 100 60 – – – – –Diverse Labelling Consultants (Pty) Ltd 1 110 100 100 (51 500) (42 991) 14 282 14 282Durpak (Pty) Ltd 1 000 100 100 6 754 (1 011) 1 003 1 003Thermopac (Pty) Ltd 6 000 100 97,5 (15 218) (19 607) 17 900 14 941Thermopackaging Natal (Pty) Ltd 100 100 100 – – – –International Tube Technology (Pty) Ltd 1 000 000 60 60 3 195 3 669 600 600JJ Precision Plastics (Pty) Ltd 200 100 100 (2 114) (2 898) 4 241 4 241Pack-Line Holdings (Pty) Ltd 750 100 100 3 628 3 336 3 215 3 215PAK 2000 (Pty) Ltd 4 000 75 75 (12 897) (17 379) 6 756 6 756Saflite Packaging (Pty) Ltd 200 75 75 (3 325) (2 250) 432 432Tamperpak (Pty) Ltd 1 000 75 75 (3 427) (2 739) – –Marcom Plastics (Pty) Ltd 100 50 50 (3 200) 1 143 4 518 4 518Knilam Packaging (Pty) Ltd 100 70 70 (12 970) (815) 12 987 12 98729.2 Subsidiaries in process of being deregisteredor liquidatedDirectly heldPortion 727 Randjiesfontein (Pty) Ltd (3) 2 100 100 3 947 3 942 362 3627 693 (128 271) 384 761 285 945Subsidiaries are packaging companies, except for:(1)Finance company(2)Property company(3)Dormant companyASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200629. ANALYSIS OF INTEREST IN SUBSIDIARY COMPANIES (continued)29.3 Business combinationsDuring the financial year ended 28 February 2006, the following business combinations were undertaken:Date of acquisition 1 March 2006 1 September 2006% shareholding 100 60HilfortR’000ConsupaqR’000TotalR’000Fair value of assets acquiredProperty, plant and equipment 49 298 12 353 61 651Deferred taxation (9 656) (1 636) (11 292)Dividends payable (247) – (247)Other investments 21 – 21Long-term liabilities (7 050) (4 612) (11 662)Accounts receivable 18 589 4 877 23 466Cash resources 16 398 7 003 23 401Inventory 10 957 1 368 12 325Accounts payable (9 615) (3 318) (12 933)Taxation (2 619) (1 300) (3 919)Short-term interest-bearing debt (7 004) (3 580) (10 584)Minority shareholders (4 478) (4 478)Trademarks – 45 4559 073 6 721 65 794Less: Cash and cash equivalents acquired (16 398) (7 003) (23 401)Goodwill on acquisition 24 209 16 281 40 490Net cash effect of purchase of subsidiaries 66 884 15 999 82 883Profit after tax since the date of acquisition included in the Group’sresults for the financial year ended 28 February 2006 16 303 3 436 19 739Should the above business combinations have been included forthe entire financial year ended 28 February 2006, the consolidatedresults would have been reflected as:ConsolidatedRevenue 1 886 000Profit after tax 150 727No entities were disposed of as a result of these business combinations.Goodwill on acquisition arose due to the present value of future profits (cost of the acquisition) exceeding the Group’s interest inthe fair value of the identifiable assets and liabilities of the subsidiary at the date of acquistion.The transactions above were accounted for using the purchase method.84ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200685Interestpaid togroupcompaniesInterestpaid bygroupcompaniesManagementfees paidto groupcompaniesManagementfeespaid bygroupcompaniesDividendspaid bygroupcompaniesTreasuryassetsof theultimateholdingcompanyTreasuryliabilitiesof theultimateholdingcompanyAmountsowingto GroupcompaniesAmountsowingby Groupcompanies30. RELATED PARTY TRANSACTIONS2006 (R’000)Astra Repro (Pty) Ltd 89 324 1 392 31Astraflex (Pty) Ltd 1 042 2 820 14 250 26 839Astrapak Corporate Services (Pty) LtdAstrapak Exports (Pty) Ltd 2 880 136Astrapak Finance Company (Pty) Ltd 650 20 17 126 7 215Astrapak Gauteng (Pty) Ltd 6 329 6 492 79 779 2 715 18 685 1 341Astrapak KwaZulu-Natal (Pty) Ltd 2 877 601 1 296 27 210 251 62 496 41 067Astrapak Linked Unit Trust 41 124Astrapak Properties (Pty) Ltd 360 1 727Astrapak Property Development(Pty) Ltd 55 6 620Astrapak Western Cape (Pty) Ltd 328 60 1 356 19 600 5 659 19 526Barrier Film Converters (Pty) Ltd 125 142 120 4 245 11Cinqcorp (Pty) LtdCinqpet (Pty) Ltd 1 284 844Cinqplast Plastop (Pty) Ltd 37 414 6 298 37 4 531Cinqprop (Pty) LtdConsupaq (Pty) LtdDiverse Labelling Consultants (Pty) Ltd 219 41 2 004 10 224 383Durpak (Pty) Ltd 1 19 1 515 6 241Euromatic Plastop (Pty) Ltd 4 120 6 004 46Hilfort Plastics (Pty) Ltd 600 58International Edgeboard Technology(Pty) Ltd 471International Tube Technology(Pty) Ltd 37 336 3 783Izakhamzi Plastics (Pty) LtdJJ Precision Plastics (Pty) Ltd 41 18 504 2 033 54Knilam Packaging (Pty) Ltd 180 17Marcom Plastics (Pty) Ltd 108 1 054 265Master Plastics (Pty) Ltd 15 111Pack-Line Holdings (Pty) Ltd 234 648 192 3 437PAK 2000 (Pty) Ltd 74 128 1 020 3 068 110Plastop KZN (Pty) Ltd 144 1 884 8 000Plastop Leasing (Pty) LtdPlastop Properties (Pty) Ltd 589 420 6 200Plastop Tools (Pty) LtdPortion 727 Randjiesfontein (Pty) Ltd 3 947Saflite Packaging (Pty) Ltd 120 23Standard Labels (Mauritius)Tamperpak (Pty) Ltd 169 86 3 452 17Thermopac (Pty) Ltd 200 56 1 873 212 178Thermopackaging Natal (Pty) Ltd4 814 10 017 2 880 30 165 61 921 114 387 109 317 18 821 176 106The management fees charged by the ultimate holding company to Group companies represents an appropriate allocation ofcosts incurred by the ultimate holding company.All transactions are at arm’s length.Refer to the remuneration report and notes 17 and 33 for details of remuneration to key management personnel.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 2006Interestpaid togroupcompaniesInterestpaid bygroupcompaniesManagementfeespaid togroupcompaniesManagementfeespaid bygroupcompaniesDividendspaid bygroupcompaniesTreasuryassetsof theultimateholdingcompanyTreasuryliabilitiesof theultimateholdingcompanyAmountsowingto GroupcompaniesAmountsowingby Groupcompanies30. RELATED PARTY TRANSACTIONS (continued)2005 (R’000)Astra Repro (Pty) Ltd 55 263 1 263 57Astraflex (Pty) Ltd 344 2 464 8 745 26 047Astrapak Corporate Services (Pty) LtdAstrapak Exports (Pty) Ltd 2 094Astrapak Finance Company (Pty) Ltd 3 372 390 1 015 5 034Astrapak Gauteng (Pty) Ltd 7 836 2 009 5 711 30 804 55 822 1 437Astrapak KwaZulu-Natal (Pty) Ltd 998 3 225 1 142 1 860 1 096 73 036 22 535Astrapak Linked Unit Trust 46 059Astrapak Properties (Pty) Ltd 390 2 047Astrapak Property Development(Pty) Ltd 1 328 2 590Astrapak Western Cape (Pty) Ltd 10 688 1 189 11 750 2 588 3 551Barrier Film Converters (Pty) Ltd 886 120 9 383 285Cinqcorp (Pty) LtdCinqpet (Pty) Ltd 447 1 447Cinqplast Plastop (Pty) Ltd 32 5 327 5 032 6 576Cinqprop (Pty) LtdConsupaq (Pty) LtdDiverse Labelling Consultants (Pty) Ltd 617 1 675 1 688 355Durpak (Pty) Ltd 2 8Hilfort Plastics (Pty) LtdInternational Edgeboard Technology(Pty) Ltd 871International Tube Technology(Pty) Ltd 292 330 4 264Izakhamzi Plastics (Pty) LtdJJ Precision Plastics (Pty) Ltd 22 101 529 1 249 55Knilam Packaging (Pty) Ltd 3Marcom Plastics (Pty) Ltd 44 999 84Master Plastics (Pty) Ltd 19 000Pack-Line Holdings (Pty) Ltd 230 800 2 713 624PAK 2000 (Pty) Ltd 6 286 936 1 382 79Plastop KZN (Pty) Ltd 658Plastop Leasing (Pty) LtdPlastop Properties (Pty) LtdPlastop Tools (Pty) LtdPortion 727 Randjiesfontein (Pty) Ltd 3 947Saflite Packaging (Pty) Ltd 114 60Standard Labels (Mauritius)Tamperpak (Pty) Ltd 145 80 2 783 35Thermopac (Pty) Ltd 22 276 1 941 4 622 191Thermopackaging Natal (Pty) Ltd12 053 10 776 2 094 24 506 32 610 60 021 88 385 58 412 125 64086ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20068731. EXPLANATION OF TRANSITION TO IFRS31.1 As stated in the accounting policies, these are the Group’s first consolidated financial statements prepared in accordancewith IFRS. The accounting policies set out in policy note 1 have been applied in preparing the financial statements for the year ended28 February 2006, the comparative information presented in these financial statements for the year ended 28 February 2005 and inthe preparation of an opening IFRS balance sheet at 1 March 2004, being the date of transition.In preparing the Group’s opening IFRS balance sheet, the Group has adjusted amounts reported previously in financial statementsprepared in accordance with South African Generally Accepted Accounting Practice (GAAP). An explanation of how the transitionfrom SA GAAP to IFRS has affected the Group’s financial position, financial performance and cash flows is set out in the tables andnotes that accompany the tables.31.2 Significant changes to the Group’s accounting policies as a result of the change to IFRSGoodwillAll business combinations are accounted for by applying the purchase method. Goodwill represents amounts arising on acquisitions ofsubsidiaries. In respect of business combinations that have occurred since the IFRS transition date, 1 March 2004, goodwill represents thedifference between the cost of the acquisition and the fair value of the net identifiable assets and contingent liabilities acquired.The Group elected in terms of IFRS 1, that IFRS 3 will only be applied from 1 March 2004. In respect of acquisitions prior to thisdate, goodwill is included as at 1 March 2004 at the amount previously reported under SA GAAP. The classification and accountingtreatment of business combinations that occurred prior to 1 March 2004 has not been reconsidered in preparing the Group’sopening IFRS balance sheet at 1 March 2004.From 1 March 2004, goodwill is stated at cost less accumulated impairment losses. Goodwill is allocated to cash-generating units andis no longer amortised, but tested annually for impairment.Previously, goodwill arising on each acquisition was amortised over its useful life, on a straight-line basis.Share-based payment transactionsThe fair value of share options granted to employees is recognised as an employee expense with a corresponding increase inequity (capital reserves). The fair value is measured at grant date and expended over the year during which the employee becomesunconditionally entitled to the equity instruments (the vesting period). The fair value of the instruments granted is measured usingthe Black Scholes valuation methodology, taking into account the terms and conditions upon which the instruments are granted.This accounting policy has been applied to all equity instruments granted after 7 November 2002 that had not yet vested by1 March 2005. The fair value of share-based payments was not recognised under the Group’s previous accounting results.31.3 Prior year restatement (SA GAAP adjustments)Straight lining of operating lease paymentsPayments due under operating leases are recognised in the income statement on a straight-line basis over the term of the lease.Past practice, whereby operating lease payments were expended on a payments basis, was based on an interpretation that wasgenerally used by entities in South Africa. This interpretation considered the contractual payments basis as being most representativeof the time pattern of the entity’s benefit obtained from the leased property. The global spotlight has led to the view that the entity isobliged to adopt the straight-line basis of accounting for all operating lease payments. The adjustment has been made as required byIAS 8 with the necessary restatement of comparative results.Property, plant and equipmentThe Group has restated the comparative information for the effects of adopting IAS 16 – Property, Plant and Equipment.For the year under review the Group reviewed the useful life of all categories of property, plant and equipment that resulted in areduction in the depreciation cost of R12 million. The change in accounting estimate is expected to benefit the Group on an ongoingbasis into the foreseeable future.The useful life of the assets will be reviewed on a continual basis and adjustments will be made accordingly.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200631. EXPLANATION OF TRANSITION TO IFRS (continued)31.4 Balance sheet (summarised)2005 balancesEffect oftransition toNotesSA GAAP aspreviouslyreportedR’000IFRS(transition date1 March 2004)R’000SA GAAPrestatementR’000Restated2005R’000Retained income 1 410 049 (2 803) (1 808) 405 438Capital reserves 2 – 2 803 – 2 803Property, plant and equipment 3 477 241 – 3 730 480 971Deferred taxation liability 4 49 142 – 686 49 828Accounts payable 5 230 228 – 4 852 235 080Notes:1) The movement in retained income can besummarised as follows:R’000IFRS adjustmentShare based payment expense recognition 2 803Prior year restatement (SA GAAP)Depreciation reversal on assets previously writtendown to zero value (3 730)Deferred taxation adjustment due to depreciationadjustment 686Straight-lining of operating leases 4 852Total 4 6112) An adjustment of R2,8 million has been processed for share-based payments for instruments granted. Previously, the fair value ofshare-based payment transactions was not recognised in the financial statements.3) An adjustment of R3,7million was processed to reinstate property, plant and equipment still in use, but previously written off tozero value.4) The tax effects of the adjustment for depreciation on zero-valued property, plant and equipment have been reflected as anadjustment to deferred tax liabilities.5) An adjustment of R4,9 million has been processed for rentals payable under operating leases in order to account for them on astraight-line basis over the term of the relevant lease.88ASTRAPAKANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 20068931. EXPLANATION OF TRANSITION TO IFRS (continued)31.5 Income statement – IFRS adjustments2005 income statementEffect oftransition toIFRS(R ‘000)SA GAAP aspreviouslyreported(transition date1 March 2004)R’000SA GAAPrestatement IFRS restatedRevenue 1 650 227 1 650 227Cost of sales (1 129 054 ) (85 464) (1 214 518 )Gross profit 521 173 (85 464) 435 709Other operating income 17 441 17 441Distribution and selling costs (127 216) (1 799) (129 015)Administrative and other operating expenses (229 687) (1 723) 86 350 (145 060)Share of results of associate and joint venture 3 619 3 619Trading income 185 330 (1 723) (913) 182 694Exceptional item 12 783 12 783Profit from operations 198 113 (1 723) (913) 195 447Investment income 2 416 2 416Finance costs (49 428) (49 428)Profit before taxation 151 101 (1 723) (913) 149 378Taxation (33 396) (33 396)Profit for the year 117 705 (1 723) (913) 115 069Attributable to:Linked unit holders of the parent 111 877 (1 723) (913) 109 241Minority interest 5 828 5 828Profit for the year 117 705 (1 723) (913) 115 069An explanation of the adjustments made to comply with IFRS and prior year restatements are included in the balance sheetexplanation table – refer to note 31.4.Depreciation to the value of R87 263 has been reallocated from administrative and other operating expenses to cost of sales(R85 464) and distribution and selling costs (R1 799). The current year results reflect depreciation under the same classifications.In addition, the share of results of associate and joint venture which was previously reflected after profit after taxation, is nowincluded at a trading income level.31.5 Cash flow statementThe IFRS adjustments and prior year restatements (SA GAAP) reflected in the above notes do not impact on cash and cashequivalents. Consequently the only adjustments that would have been made to the cash flow statement are to reported profits and alike adjustment to non-cash items.32. Comparative figuresComparative figures have been reclassified to comply with the requirements of IFRS. Details of these changes have been provided innote 31 – Explanation of transition to IFRS.ASTRAPAK ANNUAL REPORT 2006

Notes to the annual financial statements (continued)for the year ended 28 February 200633. LINKED UNIT BASED PAYMENTSEquity-settled linked unit option planThe Group plan provides for a grant price equal to the average price at which the relevant linked unit traded on the JSE on the3 (three) trading days immediately preceding the offer date. The vesting period is generally three to four years. If the option remainsunexercised after a period of eight years from the date of grant, the option expires. Furthermore, options are forfeited if the employeeleaves the Group before the options vest.2006 2005Number ofoptionsWeightedaverage priceper linked unit(in Rand)Number ofoptionsWeightedaverage priceper linked unit(in Rand)Outstanding at the beginning of the period 13 837 000 3,40 13 555 500 2,78Granted during the period 430 000 13,67 1 421 000 8,95Forfeited or cancelled during the period 448 707 3,58 190 000 5,39Exercised during the period 2 862 251 2,66 949 500 2,40Expired during the period – – – –Outstanding at the end of the period 10 956 042 3,99 13 837 000 3,40Exercisable at the end of the period 1 986 499 2,54 954 667 2,40The weighted average price at the date of exercise for linked unit options exercised during the period was R11,92. The optionsoutstanding as at 28 February 2006 had a weighted average exercise price of R3,99 and a weighted average remaining contractuallife of 2,85 years (2005: 3,74 years).The inputs into the Black-Scholes model for the various option issues are as follows:Option issue date28 Feb 06 20 Jul 05 08 Nov 04 14 Jul 03 05 May 03Number of options 330 000 100 000 1 361 000 500 000 3 010 000Weighted average linked unit price at date of issue 14,40 11,28 8,95 4,10 3,75Weighted average exercise or issue price of option 14,40 11,28 8,95 4,10 3,75Expected volatility expressed as % 34,60% 36,90% 42,70% 41,87% 42,70%Time to expiry / Expected life in years 8 8 8 8 8Risk-free rate of return 7,20% 7,60% 8,30% 9,30% 9,50%Forward dividend yield 3,30% 3,30% 3,30% 3,30% 3,30%Value per option in Rand 5,34 4,80 3,86 2,11 1,66Expected volatility was determined by calculating the historical volatility of the Group’s share price over the previous three years.This was then annualised on the assumption of 252 trading days. The risk-free rate used was that of the R153 government bond yield.The option does not entitle its holder to distributions, and a 3,3% yield was used based on the assumptions that the Group dividendpolicy will be to distribute one-third of earnings and that the linked unit will trade on an earnings yield of 10%.The Group recognised total expenses of R2 529 795 and R1 723 454 related to equity-settled linked unit-based payment transactionsin 2006 and 2005 respectively.90ASTRAPAKANNUAL REPORT 2006

Annexure 1 – details of land and buildingsat 28 February 200691Owner Description of premises ErfAstrapak Properties (Pty) LtdAstrapak Gauteng (Pty) LtdAstrapak Gauteng (Pty) LtdAstrapak Gauteng (Pty) LtdAstrapak Gauteng (Pty) LtdFactory and offices utilised byThermopacFactory and offices utilised byEast Rand PlasticsFactory and offices utilised byEast Rand PlasticsFactory and offices utilised byPeninsula PackagingFactory and offices utilised byEast Rand Plastics2006CostR’0002005CostR’000Erf 22380, GoodwoodCape Province 3 745 3 745Stand 95Vulcania, Brakpan 139 139Portion 40 of the farmKoobult 121 IR 6 572 6 572Stand 29158Bellville 5 538 5 538Stand 87Vulcania, Brakpan 3 950 3 779Astrapak Gauteng (Pty) Ltd Vacant stand Erf 45, AerotonGauteng Province 506 506Astrapak KwaZulu-Natal (Pty) LtdCinqprop (Pty) LtdPlastop (Pty) LtdPlastop Properties (Pty) LtdCinqcorp (Pty) LtdFactory and offices utilised byDiverse Labelling ConsultantsAstrapak Exports and Astra ReproFactory and offices utilised byCinqplast PlastopFactory and offices utilised byCinqplast PlastopFactory and offices utilised byPlastopFactory and offices utilised byCinqplast PlastopSub 1 of lot 2823Pinetown10 851 9 892Erf 594, DenverGauteng Province 19 704 19 704Stands 84 and 960BronkhorstspruitGauteng Province 54 54Lot 2354 AmanzimtotiPort Natal KwaZulu-Natal 6 664 6 664Erf 756, 757 and 758Denver, Extension 12Gauteng Province 11 992 11 99269 715 68 585ASTRAPAK ANNUAL REPORT 2006

Linked unitholders’ informationat 28 February 2006LINKED UNITHOLDERS’ DIARYFebruary Financial year-end September Annual General MeetingMayPreliminary results announcement for the yearended 28 February 2006OctoberInterim results announcementfor the period ending 31 August 2006AugustAnnual report publishedANALYSIS OF LINKED UNITHOLDERSLinked unitholders’ spreadas at 28 February 2006Linked unitholders in SA Linked unitholders outside SA Total linked unitholdersNumberof holdersLinkedunits held% ofissuedNumberof holdersLinkedunits held% ofissuedNumberof holdersLinkedunits held% ofissuedPublic 1 704 115 024 740 85,1 11 2 208 464 1,6 1 715 117 233 204 86,6Non-public 13 17 898 046 13,2 – – – 13 17 898 046 13,2• Directors of the Companyand its subsidiaries 11 1 998 908 1,5 – – – 11 1 998 908 1,5• Trustees of the AstrapakLimited Linked Unit TrustScheme 1 12 085 006 8,9 – – – 1 12 085 006 8,9• Tristar Plastics (a division ofAstrapak Gauteng (Pty) Ltd) 1 3 814 132 2,8 – – – 1 3 814 132 2,81 717 132 922 786 98,4 11 2 208 464 1,6 1 728 135 131 250 100,0MAJOR LINKED UNITHOLDERSas at 28 February 2006Linked unitsheld%issuedRand Merchant Bank Asset Managers 44 668 386 33,1Royal Bafokeng Finance 27 026 250 20,0Astrapak Limited Linked Unit Trust Scheme 12 085 006 8,9Sanlam Investment Management 7 339 243 5,4Prudential M&G 5 848 660 4,3Old Mutual Asset Managers 5 449 690 4,0Stanlib Asset Management 4 865 183 3,692ASTRAPAKANNUAL REPORT 2006

Linked unitholders’ information (continued)at 28 February 200693DIRECTORS’ INTERESTas at 28 February 2006DirectorBeneficialDirectNon-beneficialIndirectUnitholding(%)R Crewe-Brown 222 790 595 648 0,6M Baglione 10 000 56 700 0,0PC Botha* – 10 000 0,0RT Dalais – 268 744 0,2M Diedloff 5 230 – 0,0G Petzer 340 667 – 0,3WJ Venter 230 780 – 0,2809 467 931 092 1,3* Mr PC Botha was a trustee of the Astrapak Limited Linked Unit Trust Scheme, the holder of 12 085 006 linked units until 17 January 2006when AM Chait was appointed in his place.DIRECTORS’ INTERESTas at 28 February 2005DirectorBeneficialDirectNon-beneficialIndirectUnitholding(%)R Crewe-Brown 210 460 595 648 0,7M Baglione 153 100 56 700 0,2PC Botha* – 14 337 000 11,9RT Dalais – 140 000 0,1M Diedloff 89 000 – 0,1G Petzer 126 000 – 0,1WJ Venter 190 780 – 0,2RA Upton 53 333 – 0,1822 673 15 129 348 13,4ASTRAPAK ANNUAL REPORT 2006

Linked unitholders’ information – noticeof meetingat 28 February 2006Notice is hereby given that the Annual General Meeting ofthe linked unitholders of the Company will be held at theInanda Club, 1 Forest Road, Inanda, Sandton on Thursday,28 September 2006 at 09:00 for the following purposes:Ordinary business ¬1. Ordinary resolution number 1To receive, consider and approve the annual financialstatements of the Company and the Group together withthe reports of the directors and auditors for the year ended28 February 2006.2. Ordinary resolution number 2To elect a director in the place of Mr C Molefe who retiresin terms of the Company’s Articles of Association and who,being eligible, offers himself for re-election. A brief CVappears on page 13 of this report.3. Ordinary resolution number 3To elect a director in the place of Mr T Kgage who retiresin terms of the Company’s Articles of Association and who,being eligible, offers himself for re-election. A brief CVappears on page 13 of this report.4. Ordinary resolution number 4To elect a director in the place of Mr G Petzer who retiresin terms of the Company’s Articles of Association and who,being eligible, offers himself for re-election. A brief CVappears on page 12 of this report.5. Ordinary resolution number 5To confirm the re-appointment of Deloitte & Touche asauditors for the ensuing year and to authorise the directorsto approve their remuneration.6. Ordinary resolution number 6To approve the directors’ remuneration for the year ended28 February 2006.7. Ordinary resolution number 7To place 10% of the authorised but unissued linked unitsof the Company under the control of the directors as ageneral authority contemplated in terms of section 221 ofthe Companies Act (Act 61 of 1973) as amended (‘the Act’),and to grant the directors the authority to allot and issuethese shares on such terms and conditions as the directorsmay determine and subject to the provisions of the Act,the Articles of Association of the Company and the ListingsRequirements of JSE Limited.8. Ordinary resolution number 8To authorise the directors by way of a general approval toissue authorised but unissued linked units for cash as theymay deem fit, subject to the Act, the Articles of Associationof the Company and the Listings Requirements of JSELimited subject to the following limitations:• that at least 75% of the shareholders present in personor by proxy at the Annual General Meeting cast theirvote in favour of this resolution;• that this general authority shall not extend beyond15 months from the date of this Annual General Meetingor the date of the next Annual General Meeting,whichever is the earlier;• the securities will be issued only to public shareholdersas defined in the Listings Requirements of the JSELimited and not to related parties;• any such issue will only be securities of a class already inissue;• that issues in the aggregate in any financial year will notexceed 15% of the Company’s issued linked unit capitalas at the date of the first such issue. The securities of aparticular class will be aggregated with the securitiesthat are compulsorily convertible into securities ofthat class; and, in the case of the issue of compulsorilyconvertible securities, aggregated with the securities ofthat class into which they are compulsorily convertible.The number of securities of a class which may be issuedshall be based on the number of securities of that classin issue at the date of such application less any securitiesof the class issued during the current financial year,provided that any securities of that class to be issued94ASTRAPAKANNUAL REPORT 2006

95pursuant to a rights issue (announced and irrevocableand underwritten) or acquisition (concluded up to thedate of application) may be included as though theywere securities in issue at the date of application; and• that in determining the price at which the issue of linkedunits will be made in terms of this authority, the maximumdiscount permitted will be 10% of the weighted averagetraded price as determined over 30 business days priorto the date that the price of the issue is determined oragreed by the Company’s directors.The JSE Limited should be consulted for a ruling if theCompany’s securities have not traded in such30 business day period.The Company will publish a press announcement, at the timeof any issue representing on a cumulative basis, within oneyear, 5% or more of the number of linked units which it had inissue prior to such issue containing full details of such issue,including the impact of the issue on net asset value andearnings per share.Shares held by the share trust or scheme will not have theirvotes taken account of for the above Ordinary resolutionnumber 8.General authority to acquire linked units ¬Special resolution 1Linked unitholders are requested to consider and, if deemedfit, pass with or without modification, the following specialresolution:Resolved that the Company’s directors be hereby authorised,by way of a general authority, to repurchase linked units inthe Company and permit any subsidiary of the Company topurchase linked units in the Company, as and when deemedappropriate, subject to the Act, the Articles of Association ofthe Company and the Listings Requirements of JSE Limitedand the following limitations, namely that:• any such acquisition of linked units shall be effectedthrough the order book operated by JSE Limited’s tradingsystem and done without any prior understanding orarrangement between the Company and the counterparty;• that this general authority shall not extend beyond15 months from the date of this Annual General Meetingor the date of the next Annual General Meeting, whicheveris the earlier;• a press announcement will be published as soon as theCompany has acquired linked units constituting, on acumulative basis, 3% of the number of the linked units inissue as at the time the authority was granted;• acquisitions of linked units in the aggregate in any onefinancial year may not exceed 20% of the Company’sissued ordinary share capital and debentures (‘linked units’)as at the beginning of the financial year;• in determining the price at which linked units issued bythe Company will be acquired, the maximum premium atwhich such linked units may be acquired will be 10% ofthe weighted average of the market value at which suchlinked units are traded on the JSE, as determined over thefive business days immediately preceding the date of suchacquisition;• the sponsor to the Company provides a letter on theadequacy of working capital in terms of section 2.12 of JSELimited’s Listings Requirements prior to any repurchasesbeing implemented on the open market of the JSE; and• to the extent it is needed, the consent of the debtproviders to the Company and the Group has beenobtained prior to any repurchases being implemented onthe open market of the JSE.• after such repurchase the Company will still complywith JSE Limited’s Listings Requirements concerningshareholder spread requirements;• the Company or its subsidiary is not repurchasing securitiesduring a prohibited period as defined in JSE Limited’sListings Requirements;• and the Company only appoints one agent to effect anyrepurchase(s) on its behalf.ASTRAPAK ANNUAL REPORT 2006

Linked unitholders’ information – noticeof meeting (continued)at 28 February 2006The directors undertake that the Company shall not makeany payment to acquire any linked units issued by theCompany if there are reasonable grounds for believing thatfor a period of 12 months after the date of the notice of theannual general meeting:• the Company and the Group will after payment be unableto pay its debts as they become due in the ordinary courseof business;• the assets of the Company and the Group, fairly valued interms of International Financial Reporting Standards andon a basis consistent with the last financial year of theCompany, will after the payment be less than the liabilitiesof the Company and the Group;• the ordinary capital and reserves of the Company and theGroup will be inadequate for the purposes of the businessof the Company and the Group; and• the working capital available to the Company and theGroup will be inadequate for the purposes of the businessof the Company and the Group.The Board has no immediate intention to use this authority torepurchase linked units. However, the Board is of the opinionthat this authority should be in place should it becomeappropriate to undertake a linked unit repurchase in thefuture.Reason and effect for special resolution number 1The Board believes it to be in the best interests of theCompany that linked unitholders pass a special resolutiongranting the Company a general authority for the acquisitionby the Company of its own linked units or to permit anysubsidiary of the Company to purchase linked units in theCompany should such acquisition be in the interests of theCompany. Such general authority will provide the directorswith the flexibility, subject to the requirements of the Act andthe Listings Requirements of JSE Limited, to repurchase linkedunits should it be in the best interests of the Company at anytime while the general authority subsists.General disclosureThe JSE Listings Requirements require the followingdisclosures, some of which are elsewhere in the annual reportof which this notice forms part, as set out below:Directors and management – pages 12 and 13;Major shareholders of the Company – page 92;Directors’ interests in securities – page 93; andShare capital of the company – page 71.Litigation statementIn terms of section 11.26 of the Listings Requirements of theJSE, the directors, whose names are given on page 12 and13 of the annual report of which this notice forms part, arenot aware of any legal or arbitration proceedings, includingproceedings that are pending or threatened, that may haveor have had in the recent past, being at least the previous12 months, a material effect on the Group’s financial position.Directors’ responsibility statementThe directors, whose names are given on pages 12 and 13of the annual report, collectively and individually acceptfull responsibility for the accuracy of the informationpertaining to this resolution and certify that, to the bestof their knowledge and belief, there are no facts that havebeen omitted which would make any statement false ormisleading, and that all reasonable enquiries to ascertainsuch facts have been made and that this resolution containsall information required by law and the Listings Requirementsof JSE Limited.Material changeOther than the facts and developments reported on inthis annual report, there have been no material changesin the financial or trading position of the Company and itssubsidiaries since the date of signature of the audit reportand the date of this notice.Shares held by the share trust or scheme will not have theirvotes taken account of for the above Special resolutionnumber 1.96ASTRAPAKANNUAL REPORT 2006

Linked unitholders’ information – noticeof meeting (continued)at 28 February 200697Voting and proxiesMembers who have not dematerialised their linked units orwho have dematerialised their linked units with ‘own name’registration are entitled to attend and vote at the meetingand are entitled to appoint a proxy or proxies to attend, speakand vote in their stead. The person so appointed need not bea member.A form of proxy setting out the relevant instructions for itscompletion is enclosed for use by a linked unitholder whowishes to be represented at the general meeting. Completionof a form of proxy will not preclude such linked unitholderfrom attending and voting (in preference to that linkedunitholder’s proxy) at the Annual General Meeting. Proxyforms must be forwarded to reach the registered office ofthe Company’s transfer secretaries, Computershare InvestorServices 2004 (Pty) Limited, 70 Marshall Street, Johannesburg,2001 or posted to the transfer secretaries at PO Box 61051,Marshalltown, 2107, South Africa so as to be received bythem by not later than 09:00 on Wednesday,27 September 2006.Members who have dematerialised their linked units, otherthan those members who have dematerialised their linkedunits with ‘own name’ registration, should contact theirCSDP or broker in the manner and time stipulated in theiragreement:• to furnish them with their voting instructions; and• in the event that they wish to attend the meeting, toobtain the necessary authority to do so.Y CowleyG KingCompany SecretaryCompany SecretarySandtonSandton14 July 2006 30 August 2006On a show of hands, every member of the Company presentin person or represented by proxy shall have one vote only.On a poll, every member of the Company shall have one votefor every linked unit held in the Company by such member.ASTRAPAK ANNUAL REPORT 2006

AdministrationBUSINESS ADDRESS AND REGISTERED OFFICE1st Floor, Wierda Court, Johan Avenue, Wierda Valley, SandtonPOSTAL ADDRESSPO Box 652740, Benmore 2010TRANSFER SECRETARIESComputershare Investor Services 2004 (Pty) Limited70 Marshall Street, JohannesburgPO Box 61051Marshalltown 2107AUDITORSDeloitte & ToucheBuildings 1 and 2Deloitte PlaceThe WoodlandsWoodlands DriveWoodmead, SandtonPRINCIPAL BANKERSABSA Bank Ltd, ABSA Towers North180 Commissioner StreetJohannesburgCiti Bank N.A. South Africa, 145 West Street, SandownSPONSORRand Merchant Bank (A division of FirstRand Bank Limited)1 Merchant PlaceCnr Fredman Drive and Rivonia RoadSandtonCORPORATE LAW ADVISERSPaul Botha and Associates (Pty) Ltd39 Rivonia Road, SandhurstCOMPANY REGISTRATION NUMBER1995/009169/06WEBSITE ADDRESSwww.astrapak.co.za98ASTRAPAKANNUAL REPORT 2006

Form of proxy – linked unitholdersfor the year ended 28 February 200699This form is only to be completed by certificated and ‘own name’ registered dematerialised linked unitholders.Astrapak LimitedRegistration number 1995/009169/06Incorporated in the Republic of South AfricaShare code: APK ISIN: ZAE000030938(‘the Company’)A linked unitholder entitled to attend and vote at the Annual General Meeting is entitled to appoint a proxy, or proxies, to attend, speak andvote thereat in his/her stead. A proxy need not also be a linked unitholder of the Company. All forms of proxy must be lodged with the transfersecretaries, Computershare Investor Services 2004 (Pty) Limited, by not later than 09:00 on Wednesday, 27 September 2006.Linked unitholders, other than own name registered dematerialised linked unitholders, that have dematerialised their linked units with aCentral Securities Depository Participant (‘CSDP’) or broker, must arrange with the CSDP or broker concerned to provide them with the necessaryauthorisations to attend the Annual General Meeting. Alternatively the linked unitholders concerned must instruct them as to how they wish to vote in thisregard. This must be done in terms of the agreement entered into between the linked unitholders concerned and the CSDP or broker concerned.I/We (name)of (address)being a member(s) of the abovenamed company, hereby appoint:or failing him/her,the chairman of the Annual General Meeting,as my/our proxy to vote for me/us on my/our behalf at the Annual General Meeting of the Company to be held at 09:00 on Thursday, 28 September 2006.Signed at this day of 2006SignaturePlease indicate in the space below how you wish your votes to be cast by inserting the number of linked units in the appropriate space. If you return thisform duly signed, without any specific instructions, the proxy shall be entitled to vote as he/she thinks fit.1. Ordinary resolution number 1 – To receive, consider and approve annual financial statements2. Ordinary resolution number 2 – Re-election of Mr C Molefe3. Ordinary resolution number 3 – Re-election of Mr T Kgage4. Ordinary resolution number 4 – Re-election of Mr G Petzer5. Ordinary resolution number 5 – Re-appointment of Deloitte & Touche as auditors6. Ordinary resolution number 6 – Approval of directors’ remuneration7. Ordinary resolution number 7 – Control of authorised but unissued shares8. Ordinary resolution number 8 – General issue of linked units for cash9. Special resolution number 1 – General authority to acquire linked unitsIn favour ofAgainstAbstainfrom votingPlease read the notes on the reverse side hereof.ASTRAPAK ANNUAL REPORT 2006

Notes to proxy1. A linked unitholder may insert the names of one ormore proxies (who need not be linked unitholders of theCompany) in the space provided, with or without deletingthe words ‘the chairman of the Annual General Meeting’.The person whose name appears first on the form of proxyand has not been deleted will be entitled to act in priorityto those whose names follow. In the event that no namesare filled in, the proxy shall be exercised by the chairman ofthe Annual General Meeting.2. A linked unitholder’s instructions to the proxy must beindicated by the insertion of the relevant number of votesin the space provided. Failure to comply with the above willbe deemed to authorise the proxy to vote as he/she thinksfit. However, where the proxy is the chairman, such failureshall be deemed to authorise the chairman to vote in favourof the resolutions. A linked unitholder or his/her proxy isnot obliged to use all the votes exercisable by the linkedunitholder or his/her proxy.3. The completion and lodging of this form of proxy shallin no way preclude the linked unitholder from attending,speaking and voting in person at the Annual GeneralMeeting to the exclusion of any proxy appointed in termshereof.4. Should this form of proxy not be completed and/orreceived in accordance with these notes, the chairman mayaccept or reject it, provided that in respect of its acceptancethe chairman is satisfied as to the manner in which thelinked unitholder wishes to vote.5. This form of proxy shall be valid for any adjournment ofthe Annual General Meeting as well as the Annual GeneralMeeting to which it relates, unless the contrary is statedhereon.6. Where this form of proxy is signed under power of attorney,such power of attorney must accompany this form of proxyunless it has been previously been registered with theCompany.7. Where linked units are held jointly, all joint linkedunitholders are required to sign.8. This form of proxy must be returned to the transfersecretaries of the Company, Computershare InvestorServices 2004 (Pty) Limited, 70 Marshall Street,Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107),to be received by not later than 09:00 on Wednesday,27 September 2006.9. Linked unitholders that have dematerialised their linkedunits with a CSDP or broker must arrange with the CSDPor broker concerned to provide them with the necessaryauthorisations to attend the Annual General Meeting orthe linked unitholders concerned must instruct them as tohow they wish to vote in this regard. This must be done interms of the agreement entered into between the linkedunitholders concerned and the CSDP or broker concerned.100ASTRAPAKANNUAL REPORT 2006