chairmans adress 25/10/2011, page-5

Samizdat01 - The Board's role is not to dress up reality to give an upbeat impression; it is to report the facts which fairly and truly represent the situation of the company, and if any opinions are given - be they for forward estimates or whatever - then these must be based on the facts at hand.

Let it be understood, however, that in making this post there is NO ASSUMPTION WHATSOEVER that the Saferoads Board has, in any way, conducted itself either unethically or outside the Law.

My take on the situation:

On December 20th, the forward estimate given for the half year was an 18% decrease in revenue, and a loss for the period.

But only two months prior, we were told:

(i) The Company remained cautiously optimistic for the full year;

(ii) The budget they had in place was based on a REALISTIC outlook;

(iii) The budget they had in place was CONSERVATIVE;

(iv) Revenue was targeted to grow by 12.5% and profit was budgeted to increase substantially.

All this was within an overall generally upbeat context, and as everybody knows, context is everything. Furthermore, my understanding is that those figures are the exact same figures quoted by the CEO in the Annual Report, which was dated and signed August 29th.

So what we have, in a very short period of time, is a 180 degree turnaround in the direction of the company. But note how the Board still has not downgraded either the revenue or the profit for the FULL year. (We COULD presume that those estimates still remain valid in spite of the half year sales and profit reversals, and that the 2nd half will therefore be a bonanza).

Shareholders should be asking the following questions:

(a) Why hasn't there been any adjustment to the announced full year sales and profit estimates?

(b) If the estimates should be adjusted, what was the cause of the relatively sudden 180 degree turnaround?

(c) When did it occur?

(d) Why wasn't a turnaround this significant reported earlier?

(e) Was the October 25th confirmation of budgeted estimates updated - as it should have been - to reflect a further two months' trading figures since the time of the August 29th release? Or wasn't it?

(f) Was the person or persons who sold a total of 434,000 shares on the morning of November 16th in any way party to any information about the company which was not generally available to the market, but which the Directors reasonably should have disclosed to the market?

As one of many disgruntled shareholders, members of my group intend to forward to the Board some questions similar to the above. Any perception of failure by the Board to answer these questions adequately may well result in some further form of action on our part.

So to the previous poster: there's a lot shareholders can do in order to get to the heart of the matter. Don't forget - we are the owners of the business; business owners have rights; and we are entitled to exercise those rights, if circumstances are warranted.