Its headline loss of 35c suggested that the group was in dire straits, a contention borne out by the announcement that Absa Bank had agreed to "subordinate" some of the money owed it by Jigsaw to help it remain solvent.

Listed on the development capital board of the JSE Securities Exchange SA, Jigsaw warned in February that it would report a loss for the year. But the headline loss of R16m for the year ending in February was a far worse performance than the R705000 loss of the previous period.

"It is now evident that the impact of events over a number of years was far greater than originally anticipated," the company said yesterday.

This included buying companies for prices "in excess of sustainable levels of earnings".

The problems were compounded by a number of measures which ultimately failed. But this was not before they had an effect on Jigsaw's profits.

It expressed confidence in its ability to effect the turnaround, saying it would put more emphasis on its core business of real estate franchising, providing cash advances for estate agents commission and transfer duty.

Jun 18 2003 07:20:56:000AM Rob Rose Business Day 1st Edition