Dear Frances,RE: PRICE QUERYI refer to your correspondence of...

Dear Frances,

RE: PRICE QUERY

I refer to your correspondence of 27th June 2008.
A.B.C. Learning Centres Limited’s (“Company”) responses to the specific queries raised in your
letter are set out below:
1. Is the Company aware of any information concerning it that has not been
announced which, if known, could be an explanation for recent trading in the
securities of the Company?
Yes. The recent media speculation regarding the sale of the Company’s UK business could be
an explanation for some of the recent trading activity in the securities of the Company.
The Company has previously advised the market of an on-going sale process for the UK
Vouchers business which is consistent with the Company’s stated aim of de-leveraging the
business and strengthening the Company’s capital structure. The sale process for the
Vouchers business remains open. If a successful transaction was achieved it would not
conclude in the 2008 financial year.
The Company has previously advised it was considering selling its property assets in the UK.
In addition, the Company is now considering selling the UK nurseries business with the
Vouchers business and the UK property assets in a single transaction.
A number of highly conditional indicative proposals for the entire UK business have been
received. A sales process has commenced and discussions are continuing with interested
parties. The details of any successful transaction will be advised to the market. The current
sale process envisages that the transaction will complete in the first half of the 2009 financial
year and the profit recognised as a one-off item.
The Company has given previous guidance of an approximate $100 million profit on the sale of
the Vouchers business. If the Company concludes a sale for the entire UK business the profit
would be lower as the sale would crystallise into cash the previously recognised $51.1 million
discount on the acquisition of the Leapfrog Nurseries business. The Company is unable to give
any further guidance at this early stage of the process.
In addition, the Company notes that some of the recent trading may also be due to the
announcement of 26 June 2008 titled “US joint venture completion”.
2. If the answer to question 1 is yes, can an announcement be made immediately? If
not, why not and when is it expected that an announcement will be made?
Yes. See attached announcement.
3. Is there any reason to think that there may be a change in the operating profit
before abnormal items and income tax so that the figure for the financial year ended
30 June 2008 would vary from the previous corresponding period by more than
15%? If so, please provide details as to the extent of the likely variation.
Yes, please refer to previous guidance given on 22nd April 2008 and 10th June 2008.
4. Is there any reason to think that the Company may record any material abnormal or
extraordinary profit for the financial year ended 30 June 2008? If so, please provide
details.
Other than the financial result of those material transactions that have been announced to the
market, the Company is not currently aware of any other transactions that would result in any
material abnormal or extraordinary profit for the financial year ended 30 June 2008.
5. Is there any other explanation that the Company may have for the price change and
increase in volume in the securities of the Company?
Yes, please refer to the announcement of 26th June 2008, titled “US joint venture
completion”.
6. Please confirm that the Company is in compliance with the listing rules and, in
particular, listing rule 3.1.
The Company confirms that it is in compliance with the listing rules and, in particular,
listing rule 3.1.
Yours faithfully
Matthew Horton
Company Secretary
Contacts:
Investors and Analysts
Andrew Barber, General Manager Corporate Affairs
07 3908 2594
Media enquiries
Lisa Keenan Kate Inverarity Scott Emerson
nightingale nightingale Crook Publicity
0409 150 771 0413 163 020 0401 998 181
03 9614 6930 03 9614 6930 07 3221 7155
ASX Limited
ABN 98 008 624 691
Level 5
Riverside Centre
123 Eagle Street
Brisbane QLD 4000
PO Box 7055
Riverside Centre
Brisbane QLD 4001
Telephone 61 (07) 3835 4017
Facsimile 61 (07) 3832 4114
Internet http://www.asx.com.au
27 June 2008
Mr Matthew Horton
Company Secretary
A.B.C Learning Centres Ltd
43 Metroplex Avenue
MURARRIE QLD 4172
By email: [email protected]
Dear Mr Horton
A.B.C Learning Centres Ltd (the “Company”)
RE: PRICE QUERY
We have noted a change in the price of the Company’s securities from a close of $1.03 on Monday,
23 June 2008 to a high of $1.27 today. We also noted an increase in the volume of trading in the securities over
this period.
In light of the price change and increase in volume, please respond to each of the following questions.
1. Is the Company aware of any information concerning it that has not been announced which, if known,
could be an explanation for recent trading in the securities of the Company?
In answering this question, please address the recent press reports regarding the sale of the
Company’s entire British operations as discussed on page 67 of the Australian Financial Review
entitled, “ABC looks at wider British asset sale”, page 23 of The Australian entitled, “ABC completes US
stake sell-off” and the Dow Jones Newswires on Thursday, 26 June 2008 at 10.42 AEST and Friday, 27
June 2008 at 10.32 AEST.
2. If the answer to question 1 is yes, can an announcement be made immediately? If not, why not and
when is it expected that an announcement will be made?
Please note, if the answer to question 1 is yes and an announcement cannot be made immediately, you
need to contact us to discuss this and you need to consider a trading halt (see below).
3. Is there any reason to think that there may be a change in the operating profit before abnormal items
and income tax so that the figure for the financial year ended 30 June 2008 would vary from the
previous corresponding period by more than 15%? If so, please provide details as to the extent of the
likely variation.
ABS2008.06.27pq-ff Page 1 of 3
4. Is there any reason to think that the Company may record any material abnormal or extraordinary profit
for the financial year ended 30 June 2008? If so, please provide details.
5. Is there any other explanation that the Company may have for the price change and increase in volume
in the securities of the Company?
6. Please confirm that the Company is in compliance with the listing rules and, in particular, listing rule 3.1.
Your response should be sent to me by e-mail at [email protected] or by facsimile on facsimile
number (07) 3832 4114. It should not be sent to the Company Announcements Office.
Unless the information is required immediately under listing rule 3.1, a response is requested as soon as
possible and, in any event, not later than 2.00 p.m. Brisbane time today, Friday, 27 June 2008.
Under listing rule 18.7A, a copy of this query and your response will be released to the market, so your response
should be in a suitable form and separately address each of the questions asked. If you have any queries or
concerns, please contact me immediately.
Listing rule 3.1
Listing rule 3.1 requires an entity to give ASX immediately any information concerning it that a reasonable person
would expect to have a material effect on the price or value of the entity’s securities. The exceptions to this
requirement are set out in listing rule 3.1A.
In responding to this letter you should consult listing rule 3.1 and Guidance Note 8 – Continuous Disclosure:
listing rule 3.1.
If the information requested by this letter is information required to be given to ASX under listing rule 3.1 your
obligation is to disclose the information immediately.
Your responsibility under listing rule 3.1 is not confined to, or necessarily satisfied by, answering the questions
set out in this letter.
Trading halt
If you are unable to respond by the time requested, or if the answer to question 1 is yes and an announcement
cannot be made immediately, you should consider a request for a trading halt in the Company’s securities. As
set out in listing rule 17.1 and Guidance Note 16 – Trading Halts we may grant a trading halt at your request. We
may require the request to be in writing. We are not required to act on your request. You must tell us each of
the following.
• The reasons for the trading halt.
• How long you want the trading halt to last.
• The event you expect to happen that will end the trading halt.
• That you are not aware of any reason why the trading halt should not be granted.
• Any other information necessary to inform the market about the trading halt, or that we ask for.
ABS2008.06.27pq-ff Page 2 of 3
The trading halt cannot extend past the commencement of normal trading on the second day after the day on
which it is granted. If a trading halt is requested and granted and you are still unable to reply to this letter before
the commencement of trading, suspension from quotation would normally be imposed by us from the
commencement of trading if not previously requested by you. The same applies if you have requested a trading
halt because you are unable to release information to the market, and are still unable to do so before the
commencement of trading.
If you have any queries regarding any of the above, please let me know.
Yours sincerely,
Frances Finucan
Senior Adviser, Issuers (Brisbane)
Direct Line: (07) 3835 4017
ABS2008.06.27pq-ff Page 3 of 3