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SEP - Sephaku Holdings Ltd and its Subsidiaries - Interim financial results
for the 12 months ended 28 February 2010
Sephaku Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number: 2005/003306/06)
Share code: SEP
ISIN: ZAE000138459
("Sephaku Holdings" or "the company")
Interim Financial Results
for the 12 months ended 28 February 2010
General Information
Country of South Africa
incorporation and
domicile
Nature of business Mining and
and principal development
activities
Directors L Mohuba Chairman
NR Crafford-Lazarus Chief Executive Director
ME Smit Financial Director
RR Matjiu Executive Director
CR de Wet de Bruin Non-Executive Director
PF Fourie Non-Executive Director
GS Mahlati Non-Executive Director
MM Ngoasheng Non-Executive Director
MG Mahlare Independent Non-Executive
Director
D Twist Alternate director to ME
Smit
J Bennette Alternate director to RR
Matjiu
JW Wessels Alternate director to CR de
Wet de Bruin
Registered office Suite 4A Manhattan Office Park
16 Pieter Road
Highveld Techno Park
Centurion
0169
Postal address PO Box 68149
Highveld
Centurion
0169
Bankers ABSA Bank
Auditors PKF (Pretoria) Inc
Registered Auditors
Secretary Sephaku Management (Pty) Ltd
Company registration number 2005/003306/06
Website www.sephakuholdings.co.za
Index Page
Independent Auditor`s Report 3
Directors` Responsibilities and Approval 4
Directors` Report 5-8
Statements of Financial Position 9
Statements of Comprehensive Income 10
Statements of Changes in Equity 11-12
Statements of Cash Flows 13
Accounting Policies 14-24
Notes to the Interim Financial Results 25-48
Independent Auditor`s Report
To the member of Sephaku Holdings Ltd and its Subsidiaries
We have audited the interim financial results of Sephaku Holdings Ltd and its
Subsidiaries, which comprise the statements of financial position as at 28
February 2010, and the statement of comprehensive income, statement of changes
in equity and statements of cash flows for the year then ended, and a summary
of significant accounting policies and other explanatory notes, and the
directors` report
Directors` Responsibility for the Interim Financial Results
The company`s directors are responsible for the preparation and fair
presentation of these interim financial results in accordance with
International Financial Reporting Standards, and in the manner required by the
Companies Act of South Africa. This responsibility includes: designing,
implementing and maintaining internal control relevant to the preparation and
fair presentation of interim financial results that are free from material
misstatement, whether due to fraud or error; selecting and applying
appropriate accounting policies; and making accounting estimates that are
reasonable in the circumstances.
Auditor`s Responsibility
Our responsibility is to express an opinion on these interim financial results
based on our audit. We conducted our audit in accordance with International
Standards on Auditing. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance
whether the interim financial results are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the
amounts and disclosures in the interim financial results. The procedures
selected depend on the auditors` judgement, including the assessment of the
risks of material misstatement of the interim financial results, whether due
to fraud or error. In making those risk assessments, the auditor considers
internal control relevant to the entity`s preparation and fair presentation of
the interim financial results in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the entity`s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the
reasonableness of accounting estimates made by management, as well as
evaluating the overall presentation of the interim financial results.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the interim financial results present fairly, in all material
respects, the financial position of Sephaku Holdings Ltd and its Subsidiaries
as at 28 February 2010, and its financial performance and its cash flows for
the year then ended in accordance with International Financial Reporting
Standards, and in the manner required by the Companies Act of South Africa.
PKF (Pretoria) Inc Registered Auditors Per: S Ranchhoojee
Registration Number: 2000/026635/21
Pretoria
31 May 2010
Directors` Responsibilities and Approval
The directors are required in terms of the Companies Act of South Africa to
maintain adequate accounting records and are responsible for the content and
integrity of the interim financial results and related financial information
included in this report. It is their responsibility to ensure that the interim
financial results fairly present the state of affairs of the group as at the
end of the financial year and the results of its operations and cash flows for
the period then ended, in conformity with International Financial Reporting
Standards. The external auditors are engaged to express an independent opinion
on the interim financial results.
The interim financial results are prepared in accordance with International
Financial Reporting Standards and are based upon appropriate accounting
policies consistently applied and supported by reasonable and prudent
judgments and estimates.
The directors acknowledge that they are ultimately responsible for the system
of internal financial control established by the group and place considerable
importance on maintaining a strong control environment. To enable the
directors to meet these responsibilities, the board sets standards for
internal control aimed at reducing the risk of error or loss in a cost
effective manner. The standards include the proper delegation of
responsibilities within a clearly defined framework, effective accounting
procedures and adequate segregation of duties to ensure an acceptable level of
risk. These controls are monitored throughout the group and all employees are
required to maintain the highest ethical standards in ensuring the group`s
business is conducted in a manner that in all reasonable circumstances is
above reproach. The focus of risk management in the group is on identifying,
assessing, managing and monitoring all known forms of risk across the group.
While operating risk cannot be fully eliminated, the group endeavours to
minimise it by ensuring that appropriate infrastructure, controls, systems and
ethical behaviour are applied and managed within predetermined procedures and
constraints.
The directors are of the opinion, based on the information and explanations
given by management, that the system of internal control provides reasonable
assurance that the financial records may be relied on for the preparation of
the interim financial results. However, any system of internal financial
control can provide only reasonable, and not absolute, assurance against
material misstatement or loss.
The directors have reviewed the group`s cash flow forecast for the year to 28
February 2011 and, in the light of this review and the current financial
position, they are satisfied that the group has or has access to adequate
resources to continue in operational existence for the foreseeable future.
The external auditors are responsible for independently reviewing and
reporting on the group`s interim financial results. The interim financial
results have been examined by the group`s external auditors and their report
is presented on page 3.
The interim financial results set out on pages 5 to 48, which have been
prepared on the going concern basis, were approved by the board on 31 May 2010
and were signed on its behalf by:
L Mohuba NR Crafford-Lazarus
Directors` Report
The directors submit their report for the year ended 28 February 2010.
1. Review of activities
Main business and operations
The group is engaged in mining and development and operates principally in
South Africa and is listed on the JSE Limited.
The operating results and state of affairs of the company are fully set out in
the attached interim financial results and do not in our opinion require any
further comment.
Net profit of the group was R56 297 542 (2009: R10 498 696 loss), after
taxation of R(150 443) (2009: R644 687).
2. Going concern
The interim financial results have been prepared on the basis of accounting
policies applicable to a going concern. This basis presumes that funds will be
available to finance future operations and that the realisation of assets and
settlement of liabilities, contingent obligations and commitments will occur
in the ordinary course of business. Equity funding by investors are expected
to be sufficient to sustain the losses incurred for exploration expenses.
3. Events after the reporting period
The group announced during January 2010 that it will unbundle its exploration
assets. This process is currently being planned and shareholders should be
given notice of a shareholders meeting to approve the unbundling within the
next few weeks.
The group has also agreed to raise additional capital through equity and debt
for its proposed cement operation. This will also be dealt with in detail in
the above mentioned notice to shareholders.
The directors are not aware of any other matter or circumstance arising since
the end of the financial year that could materially affect the financial
statements.
4. Directors` interest in contracts
The Makings (Pty) Ltd - during the year under review the company rendered
services to the group at market related prices to the value of R1 391 280
(2009: R783 074). ME Smit is a director of both The Makings (Pty) Ltd and
Sephaku Holdings Ltd.
5. Accounting policies
Refer to the section `New Standard and Interpretations` for new accounting
polices applied during the current year.
6. Authorised and issued share capital
During the period under review the company issued 100 000 ordinary shares at
R8.50; 25 000 at R10 and 4 598 561 at R3. During 2009 the company issued 48
081 462 ordinary shares of R0.001 each and 10 000 non-voting convertible
shares of R0.001 each. Included in the 2009 issue were 37 663 333 ordinary
shares at an issue price of R11.11 per share to acquire 41 960 951 ordinary
shares in Sephaku Cement (Pty) Ltd at R10 per share.
Share issues for cash
Number of shares Share price Amount
50 000 R3.00 R150 000
100 000 R8.50 R850 000
4 548 561 R3.00 R13 645 683
25 000 R10.00 R250 000
R14 895 683
All issues of securities were general issues to public shareholders.
During the year 50 000 000 non-voting redeemable preference shares were
converted to ordinary shares on a one-for-one basis (note 19).
7. Share incentive scheme
Refer to note 20 for detail about share based payments during the current
year.
8. Non-current assets
Details of major changes in the nature of the non-current assets of the
company during the year were as follows:
Additions to intangible assets of the group amounted to R33 663 738 (2009: R1
5 911 046)
Additions to property, plant and equipment of the group amounted to R98 908
342 (2009: R139 668 769).
There were no changes in the nature of the non-current assets of the Group or
in the policy relating to the use of the non-current assets.
9. Dividends
No dividends were declared or paid to shareholder during the year.
10. Directors
The directors of the company during the year and to the date of this report
are as follows:
Name Changes
L Mohuba Chairman
NR Crafford-Lazarus Chief Executive Officer
ME Smit Financial Director
RR Matjiu Executive Director
CR de Wet de Bruin Non-Executive Director
PF Fourie Non-Executive Director Appointed 20
November 2009
GS Mahlati Non-Executive Director
MM Ngoasheng Non-Executive Director
MG Mahlare Independent Non-Executive
Director
D Twist Alternate director to ME Smit
J Bennette Alternate director to RR
Matjiu
JW Wessels Alternate director to CR de Appointed 20
Wet de Bruin November 2009
11. Secretary
The secretary of the company is Sephaku Management (Pty) Ltd of:
Business address
Suite 4A Manhattan Office Park
16 Pieter Road
Highveld Techno Park
Centurion
0067
Postal address
PO Box 68149
Highveld
0169
12. Interest in subsidiaries
Name of subsidiary Net income (loss)
after tax
Sephaku Fluoride (Pty) Ltd and subsidiaries (875 472)
Sephaku PGM Holdings (Pty) Ltd and subsidiaries (6 996)
Sephaku Vanadium (Pty) Ltd (7 332)
Sephaku Coal Holdings (Pty) Ltd and subsidiaries (8 949 428)
Sephaku Tin (Pty) Ltd (444 672)
Sephaku Cement (Pty) Ltd and subsidiaries (61 826 880)
Sephaku Uranium (Pty) Ltd 62 922
Aquarella Investments 555 (Pty) Ltd 702 908
Sephaku Vanadium (Pty) Ltd (7 332)
Ergomark (Pty) Ltd (86 005)
Sephaku Limestone & Exploration (Pty) Ltd (5 973)
Dala Exploration Holdings (Pty) Ltd (73 597)
Details of the company`s investment in subsidiaries are set out in note 6.
13. Auditors
PKF (Pretoria) Inc will continue in office in accordance with section 270(2)
of the Companies Act.
14. Change of financial year-end
At a shareholders meeting held on 29 January 2009 it was decided to change the
financial year-end of the group from 28 February to 30 June. This decision was
implemented for the current financial year. The financial year-end of the
group was changed to coincide with those companies in the mining industry
listed on the Johannesburg Stock Exchange.
15. Shareholders information
Major shareholders
Shareholders holding more than 5% of the Number of Percentage
issued share capital shares holding
Safika Resources 15 580 823.00 10.0%
CR de Bruin 13 369 188.00 8.6%
Lelau Mohuba Trust 10 963 767.00 7.0%
Camden Bay Investments 33 (Pty) Ltd 9 850 000.00 6.3%
Public and non-public shareholders
Shares held % Number of %
shareholders
Public 63 325 317 40.6% 378 94.5%
Non-Public 92 480 045 59.4% 22 5.5%
- Directors direct holdings 33 389 687 21.4% 9 2.3%
- Directors indirect 12 509 412 8.0% 3 0.8%
holdings
- Directors associates 46 580 946 29.9% 10 2.5%
155 805 362 100% 400 100%
Shareholder spread
Shareholder Shares held % Number of %
shareholders
1 - 1000 21 356 0.01% 40 10.00%
1001 - 10 000 449 160 0.29% 103 25.75%
10 001 - 100 000 6 016 545 3.86% 146 36.50%
100 001 - 1 000 000 28 323 691 18.18% 78 19.50%
1 000 001 - 10 000 000 81 080 832 52.04% 30 7.50%
10 000 001 - 100 000 000 39 913 778 25.62% 3 0.75%
155 805 362 100.00% 400 100.00%
Directors` Report
Beneficial shareholdings of directors (and associates):
Director Direct Indirect Associates
L Mohuba 10 963 767 490 000
NR Crafford-Lazarus 1 512 728
ME Smit 1 208 663 1 556 756
S Matjiu 3 585 923
CRD de Bruin 13 369 188 1 920 600
MN Ngoasheng 4 988 236
GS Mahlati 1 848 653 1 182 000 1 530 880
PF Fourie 6 645 159
JW Wessels 1 093 548 119 000
D Twist 7 528 080 5 626 253 1 995 000
J Bennette 1 025 702
31 172 485 24 536 179 12 481 472
Directors interest in share options
Director Number of Exercise Total value
Share price
options
L Mohuba 1 000 000 R 2.50 2 500 000
NR Crafford-Lazarus 750 000 R 2.50 1 875 000
RR Matjiu 300 000 R 2.50 750 000
JW Wessels 250 000 R 2.50 625 000
J Bennette 175 000 R 2.50 437 500
D Twist 150 000 R 2.50 375 000
MM Ngoasheng 500 000 R 2.50 1 250 000
3 125 000 7 812 500
Special resolutions
No special resolutions were passed by the issuer`s subsidiaries that had a
material effect during the period under review, other than adopting new
articles of association in compliance with the JSE requirements.
Statements of Financial Position
Group Company
Notes 2010 2009 2010 2009
R`000 R`000 R`000 R`000
Assets
Non-Current Assets
Property, plant and 3 232 968 140 983 - -
equipment
Goodwill 4 3 749 749 - -
Intangible assets 5 69 125 47 178 - -
Investments in 6 - - 437 620 434 620
subsidiaries
Investments in associates 7 - 38 266 - -
Other financial assets 10 - 200 - -
Deposits for 13 568 334 - -
rehabilitation
306 410 227 710 437 620 434 620
Current Assets
Loans to group companies 8 56 8 019 6 137 109 227
Loans to shareholders 9 906 - - -
Loans to directors, 15 2 26 2 2
managers and employees
Other financial assets 10 25 006 513 79 311 3
Current tax receivable 23 3 - - -
Trade and other 16 70 991 4 178 67 655 220
receivables
Other loans receivable 14 336 941 - -
Cash and cash equivalents 17 40 159 271 677 8 712 12 843
137 459 285 354 161 817 122 295
Non-current assets held 18 - 14 118 - -
for sale and assets of
disposal groups
Total Assets 443 869 527 182 599 437 556 915
Equity and Liabilities
Equity
Equity Attributable to
Equity Holders of Parent
Share capital 19 225 215 214 981 545 074 537 258
Reserves 1 678 4 326 1 678
(38 216)
Retained income 176 771 212 704 43 857 2 984
363 770 429 363 593 257 541 920
Non-controlling interest 60 578 83 579 - -
424 348 512 942 593 257 541 920
Liabilities
Non-Current Liabilities
Deferred tax 12 2 152 - - -
Current Liabilities
Loans from group companies 8 - 110 2 671 1 899
Other financial 21 2 002 - 2 002 -
liabilities
Current tax payable 23 1 749 4 098 1 150 1 150
Trade and other payables 24 13 310 10 021 357 11 946
Provisions 22 308 - - -
Loans payable - 11 - -
17 369 14 240 6 180 14 995
Total Liabilities 19 521 14 240 6 180 14 995
Total Equity and 443 869 527 182 599 437 556 915
Liabilities
Net asset value per share 45 233.48 284.19
(cents)
Tangible net asset value 45 186.71 252.47
per share (cents)
Statements of Comprehensive Income
Group Company
Notes 2010 2009 2010 2009
R`000 R`000 R`000 R`000
Revenue 26 2 509 - - -
Cost of sales 27 (1 215) - - -
Gross profit 1 294 - - -
Other income 3 740 15 386 315 -
Operating expenses (104 619) (53 378) (16 541) (7 805)
Profit on disposal of 32 290 - 56 000 -
companies
Operating (loss) profit 28 (67 295) (37 992) 39 774 (7 805)
Investment revenue 29 13 256 30 374 1 341 474
Loss from equity accounted (2 102) (1 964) (242) -
investments
Finance costs 30 (10) (271) - -
(Loss) profit before (56 151) (9 853) 40 873 (7 331)
taxation
Taxation 31 (150) (644) - -
(Loss) profit for the year (56 301) (10 497) 40 873 (7 331)
Other comprehensive
income:
Effects of cash flow (53 178) - - -
hedges net of tax
Total comprehensive (loss) (109 479) (10 497) 40 873 (7 331)
income for the period
(Loss) profit attributable
to:
Equity holders of the (43 936) (11 044) 40 873 (7 331)
parent
Non-controlling interest (12 365) 547 - -
(56 301) (10 497) 40 873 (7 331)
Total comprehensive (loss)
income attributable to:
Owners of the parent (86 478) (11 044) 40 873 (7 331)
Non-controlling interest (23 001) 547 - -
(109 479) (10 497) 40 873 (7 331)
Basic earnings/(loss) per 45 (28.31) (8.88)
share (cents)
Diluted earnings/(loss) 45 (27.56) (8.59)
per share (cents)
Headline earnings/(loss) 45 (43.09) (9.35)
per share (cents)
Diluted headline 45 (41.95) (9.04)
earnings/(loss) per share
(cents)
Statements of Changes in Equity
Share Share Total Hedging
capital premium share reserve
capital
R`000 R`000 R`000 R`000 R`000
Group
Balance at 01 March 2008 296 84 355 84 651 -
Changes in equity - - - -
Total comprehensive
(loss)/income for the year
Issue of shares 48 445 389 445 437 -
Treasury shares held by - (2 234) (2 234) -
subsidiary
Premium paid on acquisition - (319 859) (319 859) -
of additional shares in
subsidiary
Issue of preference shares - 100 100 -
Preference shares to be 7 080 - 7 080 -
issued
Ordinary shares from previous (194) - (194) -
period included in issue
Gain on issue of shares to - - - -
minorities
Business combinations - - - -
Total changes 6 934 123 396 130 330 -
Balance at 01 March 2009 7 230 207 751 214 981 -
Changes in equity
Total comprehensive - - - (42 542)
(loss)/income for the year
Issue of shares 7 817 - 7 817 -
Transfer Share Premium to 207 751 (207 751) - -
Share
-
Capital
Employees share option scheme - - - -
Sephaku Management (Pty) Ltd - - - -
transferred to Trust
Subsidiary holding treasury 2 417 - 2 417 -
shares sold
Total changes 217 985 (207 751) 10 234 (42 542)
Balance at 28 February 2010 225 215 - 225 215 (42 542)
Notes 19 19 19 33
Other Total Retained Total
NDR reserves income attributa
ble to
equity
holders
of the
group/com
pany
R`000 R`000 R`000 R`000 R`000
Group
Balance at 01 March 2008 1 678 1 678 39 966 126 295
Changes in equity - - (11 044) (11 044)
Total comprehensive
(loss)/income for the year
Issue of shares - - - 445 437
Treasury shares held by - - (4 169) (6 403)
subsidiary
Premium paid on acquisition - - - (319 859)
of additional shares in
subsidiary
Issue of preference shares - - - 100
Preference shares to be - - - 7 080
issued
Ordinary shares from previous - - - (194)
period included in issue
Gain on issue of shares to - - 187 951 187 951
minorities
Business combinations - - - -
Total changes - - 172 738 303 068
Balance at 01 March 2009 1 678 1 678 212 704 429 363
Changes in equity
Total comprehensive - (42 542) (43 936) (86 478)
(loss)/income for the year
Issue of shares - - - 7 816 043
Transfer Share Premium to - - - -
Share
Capital
Employees share option scheme 2 648 2 648 - 2 648
Sephaku Management (Pty) Ltd - - 8 003 8 003
transferred to Trust
Subsidiary holding treasury - - - 2 417
shares sold
Total changes 2 648 (39 894) (35 933) (65 593)
Balance at 28 February 2010 4 326 (38 216) 176 771 363 770
Notes 33
Non- Total
controll equity
ing
interest
R`000 R`000
Group
Balance at 01 March 2008 20 734 147 029
Changes in equity 547 (10 497)
Total comprehensive
(loss)/income for the year
Issue of shares - 445 437
Treasury shares held by - (6 403)
subsidiary
Premium paid on acquisition - (319 859)
of additional shares in
subsidiary
Issue of preference shares - 100
Preference shares to be - 7 080
issued
Ordinary shares from previous - (194)
period included in issue
Gain on issue of shares to - 187 951
minorities
Business combinations 62 298 62 298
Total changes 62 845 365 913
Balance at 01 March 2009 83 579 512 942
Changes in equity
Total comprehensive (23 001) (109 479)
(loss)/income for the year
Issue of shares - 7 816 043
Transfer Share Premium to - -
Share
Capital
Employees share option scheme - 2 648
Sephaku Management (Pty) Ltd - 8 003
transferred to Trust
Subsidiary holding treasury - 2 417
shares sold
Total changes (23 001) (88 594)
Balance at 28 February 2010 60 578 424 348
Notes
Share Share Total Hedging
capital premium share reserve
capital
R`000 R`000 R`000 R`000
Company
Balance at 01 March 2008 297 84 538 84 835 -
Changes in equity
Total comprehensive - - - -
(loss)/income for the year
Issue of shares 48 445 389 445 437 -
Issue of preference shares - 100 100 -
Ordinary shares from the (194) - (194) -
previous period included in
issue
Ordinary shares in the 7 080 - 7 080 -
process of being issued
Total changes 6 934 445 489 452 423 -
Balance at 01 March 2009 7 231 530 027 537 258 -
Changes in equity
Total comprehensive - - - -
(loss)/income for the year
Issue of shares 7 816 - 7 816 -
Employees share option scheme - - - -
Transfer Share Premium to 530 027 (530 027) - -
Share Capital
Total changes 537 843 (530 027) 7 816 -
Balance at 28 February 2010 545 074 - 545 074 -
Notes 19 19 19 33
Other Total Retained Total
NDR reserves income
R`000 R`000 R`000 R`000
Company
Balance at 01 March 2008 1 678 1 678 10 315 96 828
Changes in equity
Total comprehensive - - (7 331) (7 331)
(loss)/income for the year
Issue of shares - - - 445 437
Issue of preference shares - - - 100
Ordinary shares from the - - - (194)
previous period included in
issue
Ordinary shares in the - - - 7 080
process of being issued
Total changes - - (7 331) 445 092
Balance at 01 March 2009 1 678 1 678 2 984 541 920
Changes in equity
Total comprehensive - - 40 873 40 873
(loss)/income for the year
Issue of shares - - - 7 816
Employees share option scheme 2 648 2 648 - 2 648
Transfer Share Premium to - - - -
Share Capital
Total changes 2 648 2 648 40 873 51 337
Balance at 28 February 2010 4 326 4 326 43 857 593 257
Notes 33
Non- Total
controll equity
ing
interest
R`000 R`000
Company
Balance at 01 March 2008 - 96 828
Changes in equity
Total comprehensive - (7 331)
(loss)/income for the year
Issue of shares - 445 437
Issue of preference shares - 100
Ordinary shares from the - (194)
previous period included in
issue
Ordinary shares in the - 7 080
process of being issued
Total changes - 445 092
Balance at 01 March 2009 - 541 920
Changes in equity
Total comprehensive - 40 873
(loss)/income for the year
Issue of shares - 7 816
Employees share option scheme - 2 648
Transfer Share Premium to - -
Share Capital
Total changes - 51 337
Balance at 28 February 2010 - 593 257
Notes
Statements of Cash Flows
Group Company
Notes 2010 2009 2010 2009
R`000 R`000 R`000 R`000 R`000
Cash flows from operating
activities
Cash (used in) /generated 34 (82 898) (15 997) (15 866) (1 236)
from operations
Interest income 13 256 30 373 1 341 474
Finance costs (10) (270) - -
Tax paid 35 (2 502) - - -
Net cash from operating (72 154) 14 106 (14 525) (762)
activities
Cash flows from investing
activities
Purchase of property, 3 (77 440) (136 298) - -
plant and equipment
Sale of property, plant 3 - 6 - -
and equipment
Purchase of other 5 (33 663) (15 911) - -
intangible assets
Acquisition of businesses 36 (22 850) (11 773) (3 000) -
Sale of businesses 37 - - 30 000 -
Movement in other 21 056 9 352 (84 577) (2)
financial assets
Purchase of deposits for (234) (75) - -
rehabilitation
Movement in other loans 713 - - -
receivable
Purchase of other - (375) - -
financial asset
Transfer assets of - (14 117) - -
disposal groups
Net cash from investing (112 418) (169 191) (57 577) (2)
activities
Cash flows from financing
activities
Proceeds on share issue 19 7 816 445 437 7 816 25 828
Preference share issue 19 - 100 - 100
Movement in other 2 002 - 2 001 -
financial liabilities
Movement in other loans (11) - - -
payable
Movement in loans to 28 426 - -
directors, managers and
employees
Repayment of shareholders (906) - - -
loan
Finance lease payments - - - -
Forex loss through cash (53 177) - - -
flow hedge reserve
Net movements in loans (2 701) (4 260) 58 151 (23 765)
with group companies
Cash raised from / (paid - (76 013) - -
to) minority shareholders
Cash received for shares - 6 885 - 6 885
not yet issued
Net cash from financing (46 949) 372 575 67 968 9 048
activities
Total cash movement for (231 521) 217 490 (4 134) 8 284
the year
Cash at the beginning of 271 677 54 186 12 843 4 559
the year
Total cash at end of the 17 40 159 271 676 8 709 12 843
year
Accounting Policies
1. Presentation of Interim Financial Results
The interim financial results have been prepared in accordance with
International Financial Reporting Standards, and the Companies Act of South
Africa. The interim financial results have been prepared on the historical
cost basis, and incorporate the principal accounting policies set out below.
They are presented in South African Rands.
These accounting policies are consistent with the previous period.
1.1 Consolidation
Basis of consolidation
The consolidated interim financial results incorporate the interim financial
results of the company and all entities, including special purpose entities,
which are controlled by the company.
Control exists when the company has the power to govern the financial and
operating policies of an entity so as to obtain benefits from its activities.
The results of subsidiaries are included in the consolidated interim financial
results from the effective date of acquisition to the effective date of
disposal.
Adjustments are made when necessary to the interim financial results of
subsidiaries to bring their accounting policies in line with those of the
group.
All intra-group transactions, balances, income and expenses are eliminated in
full on consolidation.
Non-controlling interests in the net assets of consolidated subsidiaries are
identified and recognised separately from the group`s interest therein, and
are recognised within equity. Losses of subsidiaries attributable to non-
controlling interests are allocated to the non-controlling interest even if
this results in a debit balance being recognised for non-controlling interest.
Transactions which result in changes in ownership levels, where the group has
control of the subsidiary both before and after the transaction are regarded
as equity transactions and are recognised directly in the statement of changes
in equity.
The difference between the fair value of consideration paid or received and
the movement in non-controlling interest for such transactions is recognised
in equity attributable to the owners of the parent.
Business combinations
The group accounts for business combinations use the acquisition method of
accounting. The cost of the business combination is measured as the aggregate
of the fair values of assets given, liabilities incurred or assumed and equity
instruments issued.Costs directly attributable to the business combination are
expensed as incurred, except the costs to issue debt which are amortised as
part of the effective interest and costs to issue equity which are included in
equity.
The acquiree`s identifiable assets, liabilities and contingent liabilities
which meet the recognition conditions of IFRS 3 Business Combinations are
recognised at their fair values at acquisition date, except for non-current
assets (or disposal group) that are classified as held-for-sale in accordance
with IFRS 5 Non-current Assets Held-For-Sale and discontinued operations,
which are recognised at fair value less costs to sell.
In cases where the group held a non-controlling shareholding in the acquiree
prior to obtaining control, that interest is measured to fair value as at
acquisition date. The measurement to fair value is included in profit or loss
for the year. Where the existing shareholding was classified as an available-
for-sale financial asset, the cumulative fair value adjustments recognised
previously to other comprehensive income and accumulated in equity are
recognised in profit or loss as a reclassification adjustment.
Goodwill is determined as the consideration paid, plus the carrying value of
any shareholding held prior to obtaining control, plus non-controlling
interest and less the fair value of the identifiable assets and liabilities of
the acquiree.
Goodwill is not amortised but is tested on an annual basis for impairment. If
goodwill is assessed to be impaired, that impairment is not subsequently
reversed.
1.1 Investment in associates
An associate is an entity over which the group has significant influence and
which is neither a subsidiary nor a joint venture. Significant influence is
the power to participate in the financial and operating policy decisions of
the investee but is not control or joint control over those policies.
An investment in associate is accounted for using the equity method, except
when the investment is classified as held-for-sale in accordance with IFRS 5
Non-current Assets Held-For-Sale and discontinued operations. Under the equity
method, investments in associates are carried in the consolidated statements
of financial position at cost adjusted for post acquisition changes in the
group`s share of net assets of the associate, less any impairment losses.
The group recognized its share of losses of the associate to the extent of the
group`s net investment in the associate.
Profits or losses on transactions between the group and an associate are
eliminated to the extent of the group`s interest therein.
The groups share of unrealized intra company gains are eliminated upon
consolidation and the groups share of intra company losses are also eliminated
provided they do not provide evidence that the asset transferred is impaired.
1.2 Significant judgements and sources of estimation uncertainty
In preparing the interim financial results, management is required to make
estimates and assumptions that affect the amounts represented in the interim
financial results and related disclosures. Use of available information and
the application of judgement is inherent in the formation of estimates. Actual
results in the future could differ from these estimates which may be material
to the interim financial results. Significant judgements include:
Trade receivables and Loans and receivables
The group assesses its Trade receivables and Loans and receivables for
impairment at the end of each reporting period. In determining whether an
impairment loss should be recorded in profit or loss, the group makes
judgements as to whether there is observable data indicating a measurable
decrease in the estimated future cash flows from a financial asset.
The impairment for Trade receivables and Loans and receivables is calculated
on a portfolio basis, based on historical loss ratios, adjusted for national
and industry-specific economic conditions and other indicators present at the
reporting date that correlate with defaults on the portfolio. These annual
loss ratios are applied to loan balances in the portfolio and scaled to the
estimated loss emergence period.
Options granted
Management used the Black Scholes model to determine the value of the options
at issue date. Additional details regarding the estimates are included in the
note 20 - Share based payments.
Impairment testing
The recoverable amounts of cash-generating units and individual assets have
been determined based on the higher of value-in-use calculations and fair
values less costs to sell. These calculations require the use of estimates and
assumptions. It is reasonably possible that the assumptions may change which
may then impact our estimations and may then require a material adjustment to
the carrying value of goodwill and tangible assets.
The group reviews and tests the carrying value of assets when events or
changes in circumstances suggest that the carrying amount may not be
recoverable. In addition, goodwill is tested on an annual basis for
impairment. Assets are grouped at the lowest level for which identifiable cash
flows are largely independent of cash flows of other assets and liabilities.
If there are indications that impairment may have occurred, estimates are
prepared of expected future cash flows for each group of assets. Expected
future cash flows used to determine the value in use of goodwill, intangible
assets and tangible assets are inherently uncertain and could materially
change over time. They are significantly affected by a number of factors
including together with economic factors.
Taxation
Judgement is required in determining the provision for income taxes due to the
complexity of legislation. There are many transactions and calculations for
which the ultimate tax determination is uncertain during the ordinary course
of business. The group recognises liabilities for anticipated tax audit issues
based on estimates of whether additional taxes will be due. Where the final
tax outcome of these matters is different from the amounts that were initially
recorded, such differences will impact the income tax and deferred tax
provisions in the period in which such determination is made.
The group recognises the net future tax benefit related to deferred income tax
assets to the extent that it is probable that the deductible temporary
differences will reverse in the foreseeable future. Assessing the
recoverability of deferred income tax assets requires the group to make
significant estimates related to expectations of future taxable income.
Estimates of future taxable income are based on forecast cash flows from
operations and the application of existing tax laws in each jurisdiction. To
the extent that future cash flows and taxable income differ significantly from
estimates, the ability of the group to realise the net deferred tax assets
recorded at the end of the reporting period could be impacted.
Exploration expenses capitalised
Exploration and evaluation expenses are those expenses incurred in connection
with acquisition of rights to explore, investigate, examine and evaluate an
area of mineralization including related overhead costs. The directors
exercise judgment to determine if the costs associated with a specific project
must be capitalised against the specific project or written off.
Exploration assets are reviewed at balance sheet date and where the directors
consider there to be indicators of impairment, impairment tests will be
performed on the capitalised costs and any impairments will be recognised
through the income statement.
Site restoration cost
Provision for future site restoration costs are based on the estimate made of
the expenditure needed to settle the present obligation arising. When site
restoration occurs on an on-going basis during prospecting, the cost of this
restoration is included in prospecting expenses and no provision for future
restoration costs are required.
1.3 Property, plant and equipment
The cost of an item of property, plant and equipment is recognised as an asset
when:
- it is probable that future economic benefits associated with the item will
flow to the company; and
- the cost of the item can be measured reliably.
Property, plant and equipment is initially measured at cost.
Costs include costs incurred initially to acquire or construct an item of
property, plant and equipment and costs incurred subsequently to add to,
replace part of, or service it. If a replacement cost is recognised in the
carrying amount of an item of property, plant and equipment, the carrying
amount of the replaced part is derecognised.
The initial estimate of the costs of dismantling and removing the item and
restoring the site on which it is located is also included in the cost of
property, plant and equipment, where the entity is obligated to incur such
expenditure, and where the obligation arises as a result of acquiring the
asset or using it for purposes other than the production of inventories.
Property, plant and equipment are depreciated on the straight line basis over
their expected useful lives to their estimated residual value. Property, plant
and equipment is carried at cost less accumulated depreciation and any
impairment losses.
Item Average useful life
Buildings 10 years
Ash Processing Plant 1 - 15 years
Furniture and fixtures 6 years
Motor vehicles 5 years
Office equipment 6 years
IT equipment 3 years
Field equipment 5 years
The residual value, useful life and depreciation method of each asset are
reviewed at the end of each reporting period. If the expectations differ from
previous estimates, the change is accounted for as a change in accounting
estimate.
Each part of an item of property, plant and equipment with a cost that is
significant in relation to the total cost of the item is depreciated
separately.
The depreciation charge for each period is recognised in profit or loss unless
it is included in the carrying amount of another asset.
Land is not depreciated.
The cement manufacturing plant and milling plant are in the development phase
and no depreciation is calculated until the commissioning of the plant.
The gain or loss arising from the derecognition of an item of property, plant
and equipment is included in profit or loss when the item is derecognised. The
gain or loss arising from the derecognition of an item of property, plant and
equipment is determined as the difference between the net disposal proceeds,
if any, and the carrying amount of the item.
1.4 Site restoration and dismantling cost
The company has an obligation to dismantle, remove and restore items of
property, plant and equipment. Such obligations are referred to as
`decommissioning, restoration and similar liabilities`. The cost of an item of
property, plant and equipment includes the initial estimate of the costs of
dismantling and removing the item and restoring the site on which it is
located, the obligation for which an entity incurs either when the item is
acquired or as a consequence of having used the item during a particular
period for purposes other than to produce inventories during that period.
If the related asset is measured using the cost model:
- changes in the liability are added to, or deducted from, the cost of the
related asset in the current period
- if a decrease in the liability exceeds the carrying amount of the asset, the
excess is recognised immediately in profit or loss.
- if the adjustment results in an addition to the cost of an asset, the entity
considers whether this is an indication that the new carrying amount of the
asset may not be fully recoverable. If it is such an indication, the asset is
tested for impairment by estimating its recoverable amount, and any impairment
loss is recognised in profit or loss.
1.5 Intangible assets
An intangible asset is recognised when:
- it is probable that the expected future economic benefits that are
attributable to the asset will flow to the entity; and
- the cost of the asset can be measured reliably.
Intangible assets are initially recognised at cost.
Intangible assets are carried at cost less any accumulated amortisation and
any impairment losses.
Exploration assets are carried at cost less any impairment losses. All costs,
including administration and other general overhead costs directly associated
with the specific project are capitalised. The directors evaluate each project
at each period end to determine if the carrying value should be written off.
In determining whether expenditure meet the criteria to be capitalised, the
directors use information from several sources, depending on the level of
exploration. Purchased exploration and evaluation assets are recognised at the
cost of acquisition or at the fair value if purchased as part of a business
combination. Exploration assets are not amortised as it will only be available
for use once transferred to the development cost of the project.
An intangible asset is regarded as having an indefinite useful life when,
based on all relevant factors, there is no foreseeable limit to the period
over which the asset is expected to generate net cash inflows. Amortisation is
not provided for these intangible assets, but they are tested for impairment
annually and whenever there is an indication that the asset may be impaired.
For all other intangible assets amortisation is provided on a straight line
basis over their useful life.
When the technical and commercial feasibility of a project has been
established, the relevant exploration assets are transferred to development
costs. No further exploration costs for the project will be capitalised. The
costs transferred to development costs will be amortised over the life of the
project based on the expected flow of economic resources associated with the
project.
The amortisation period and the amortisation method for intangible assets are
reviewed every period-end.
Amortisation is provided to write down the intangible assets, on a straight
line basis, to their residual values as follows:
Item Useful life
Computer software 2 years
Deferred exploration costs Not amortised
1.6 Investments in subsidiaries
Company interim financial results
In the company`s separate interim financial results, investments in
subsidiaries are carried at cost less any accumulated impairment.
The cost of an investment in a subsidiary is the aggregate of:
- the fair value, at the date of exchange, of assets given, liabilities
incurred or assumed, and equity instruments issued by the company; plus
- any costs directly attributable to the purchase of the subsidiary.
An adjustment to the cost of a business combination contingent on future
events is included in the cost of the combination if the adjustment is
probable and can be measured reliably.
1.7 Investments in associates
Company interim financial results
An investment in an associate is carried at cost less any accumulated
impairment.
1.8 Financial instruments
Classification
The group classifies financial assets and financial liabilities into the
following categories:
- Financial assets at fair value through profit or loss - held for trading
- Loans and receivables
- Available-for-sale financial assets
- Financial liabilities at fair value through profit or loss - held for
trading
- Financial liabilities measured at amortised cost
Initial recognition and measurement
Financial instruments are recognised initially when the group becomes a party
to the contractual provisions of the instruments.
The group classifies financial instruments, or their component parts, on
initial recognition as a financial asset, a financial liability or an equity
instrument in accordance with the substance of the contractual arrangement.
Financial instruments are initially measured at fair value.
For financial instruments which are not at fair value through profit or loss,
transaction costs are included in the initial measurement of the instrument.
Transaction costs on financial instruments at fair value through profit or
loss are recognised in profit or loss.
Subsequent measurement
Financial instruments at fair value through profit or loss are subsequently
measured at fair value, with gains and losses arising from changes in fair
value being included in profit or loss for the period.
Net gains or losses on the financial instruments at fair value through profit
or loss exclude dividends and interest.
Loans and receivables are subsequently measured at amortised cost, using the
effective interest method, less accumulated impairment losses.
Available-for-sale financial assets are subsequently measured at fair value.
This excludes equity investments for which a fair value is not determinable,
which are measured at cost less accumulated impairment losses.
Gains and losses arising from changes in fair value are recognised in other
comprehensive income and accumulated in equity until the asset is disposed of
or determined to be impaired. Interest on available-for-sale financial assets
calculated using the effective interest method is recognised in profit or loss
as part of other income. Dividends received on available-for-sale equity
instruments are recognised in profit or loss as part of other income when the
group`s right to receive payment is established.
Changes in fair value of available-for-sale financial assets denominated in a
foreign currency are analysed between translation differences resulting from
changes in amortised cost and other changes in the carrying amount.
Translation differences on monetary items are recognised in profit or loss,
while translation differences on non-monetary items are recognised in other
comprehensive income and accumulated in equity.
Financial liabilities at amortised cost are subsequently measured at amortised
cost, using the effective interest method.
No discounting is applied for instruments at amortised cost where the effects
of the time value of money are not considered to be material.
Fair value determination
The fair values of quoted investments are based on current bid prices. If the
market for a financial asset is not active (and for unlisted securities), the
group establishes fair value by using valuation techniques. These include the
use of recent arm`s length transactions, reference to other instruments that
are substantially the same, discounted cash flow analysis, and option pricing
models making maximum use of market inputs and relying as little as possible
on entity-specific inputs.
Impairment of financial assets
At each reporting date the group assesses all financial assets, other than
those at fair value through profit or loss, to determine whether there is
objective evidence that a financial asset or group of financial assets has
been impaired.
Impairment losses are recognised in profit or loss.
Loans to (from) group companies
These include loans to and from holding companies, fellow subsidiaries,
subsidiaries and associates and are recognised initially at fair value plus
direct transaction costs.
Loans to group companies are classified as loans and receivables.
Loans from group companies are classified as financial liabilities measured at
amortised cost.
Loans to shareholders, directors, managers and employees
These financial assets are classified as loans and receivables.
Trade and other receivables
Trade receivables are measured at initial recognition at fair value, and are
subsequently measured at amortised cost using the effective interest rate
method. Appropriate allowances for estimated irrecoverable amounts are
recognised in profit or loss when there is objective evidence that the asset
is impaired. Significant financial difficulties of the debtor, probability
that the debtor will enter bankruptcy or financial reorganisation, and default
or delinquency in payments (more than 180 days overdue) are considered
indicators that the trade receivable is impaired. The allowance recognised is
measured as the difference between the asset`s carrying amount and the present
value of estimated future cash flows discounted at the effective interest rate
computed at initial recognition.
The carrying amount of the asset is reduced through the use of an allowance
account, and the amount of the loss is recognised in profit or loss within
operating expenses. When a trade receivable is uncollectable, it is written
off against the allowance account for trade receivables. Subsequent recoveries
of amounts previously written off are credited against operating expenses in
profit or loss.
Trade and other receivables are classified as loans and receivables.
Trade and other payables
Trade payables are initially measured at fair value, and are subsequently
measured at amortised cost, using the effective interest rate method.
Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits, and other
short-term highly liquid investments that are readily convertible to a known
amount of cash and are subject to an insignificant risk of changes in value.
These are initially and subsequently recorded at fair value.
Hedging activities
Designated and effective hedging instruments are excluded from the definition
of financial instruments at fair value through profit or loss.
The group designates certain derivatives as:
- hedges of a particular risk associated with a recognised asset or liability
or a highly probable forecast transaction or on foreign currency risk of a
firm commitment (cash flow hedge);
The group documents at the inception of the transaction the relationship
between hedging instruments and hedged items, as well as its risk management
objectives and strategy for undertaking various hedging transactions. The
group also documents its assessment, both at hedge inception and on an ongoing
basis, of whether the derivatives that are used in hedging transactions are
highly effective in offsetting changes in fair values or cash flows of hedged
items.
The full fair value of a hedging derivative is classified as a non-current
asset or liability when the remaining hedged item is more than 12 months, and
as a current asset or liability when the remaining maturity of the hedged item
is less than 12 months.
Cash flow hedge
The effective portion of changes in the fair value of derivatives that are
designated and qualify as cash flow hedges is recognised to other
comprehensive income and accumulated in equity. The gain or loss relating to
the ineffective portion is recognised immediately in profit or loss within
`other income`.
Amounts accumulated in equity are reclassified to other comprehensive income
to profit or loss in the periods when the hedged item affects profit or loss
(for example, when the forecast sale that is hedged takes place).
However, when the forecast transaction that is hedged results in the
recognition of a non-financial item (for example, inventory or fixed assets)
the gains and losses previously deferred in equity are transferred from equity
in other comprehensive income and included in the initial measurement of the
cost of the asset.
When a hedging instrument expires or is sold, or when a hedge no longer meets
the criteria for hedge accounting, any cumulative gain or loss existing in
equity at that time remains in equity and is recognised in profit or loss as a
reclassification adjustment through to other comprehensive income when the
forecast transaction is ultimately recognised in profit or loss.
When a forecast transaction is no longer expected to occur, the cumulative
gain or loss that was reported in equity is immediately recognised in profit
or loss as a reclassification adjustment through to other comprehensive
income.
1.9 Tax
Current tax assets and liabilities
Current tax for current and prior periods is, to the extent unpaid, recognised
as a liability. If the amount already paid in respect of current and prior
periods exceeds the amount due for those periods, the excess is recognised as
an asset.
Current tax liabilities (assets) for the current and prior periods are
measured at the amount expected to be paid to (recovered from) the tax
authorities, using the tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.
Deferred tax assets and liabilities
A deferred tax liability is recognised for all taxable temporary differences,
except to the extent that the deferred tax liability arises from the initial
recognition of an asset or liability in a transaction other than a business
combination that at the time of the transaction, affects neither accounting
profit nor taxable profit (tax loss).
A deferred tax asset is recognised for all deductible temporary differences to
the extent that it is probable that taxable profit will be available against
which the deductible temporary difference can be utilised. A deferred tax
asset is not recognised when it arises from the initial recognition of an
asset or liability in a transaction at the time of the transaction, affects
neither accounting profit nor taxable profit (tax loss).
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is
settled, based on tax rates (and tax laws) that have been enacted or
substantively enacted by the end of the reporting period.
Tax expenses
Current and deferred taxes are recognised as income or an expense and included
in profit or loss for the period, except to the extent that the tax arises
from:
- a transaction or event which is recognised, in the same or a different
period, to other comprehensive income,
- a transaction or event which is recognised, in the same or a different
period, directly in equity, or
- a business combination.
Current tax and deferred taxes are charged or credited to other comprehensive
income if the tax relates to items that are credited or charged, in the same
or a different period, to other comprehensive income.
Current tax and deferred taxes are charged or credited directly to equity if
the tax relates to items that are credited or charged, in the same or a
different period, directly in equity.
1.10 Non-current assets held for sale (and) (disposal groups)
Non-current assets and disposal groups are classified as held for sale if
their carrying amount will be recovered through a sale transaction rather than
through continuing use. This condition is regarded as met only when the sale
is highly probable and the asset (or disposal group) is available for
immediate sale in its present condition. Management must be committed to the
sale, which should be expected to qualify for recognition as a completed sale
within one year from the date of classification.
Non-current assets held for sale (or disposal group) are measured at the lower
of its carrying amount and fair value less costs to sell.
A non-current asset is not depreciated (or amortised) while it is classified
as held for sale, or while it is part of a disposal group classified as held
for sale.
Interest and other expenses attributable to the liabilities of a disposal
group classified as held for sale are recognised in profit or loss.
1.11 Impairment of assets
The group assesses at each end of the reporting period whether there is any
indication that an asset may be impaired. If any such indication exists, the
group estimates the recoverable amount of the asset.
Irrespective of whether there is any indication of impairment, the group also:
- tests intangible assets with an indefinite useful life or intangible assets
not yet available for use for impairment annually by comparing its carrying
amount with its recoverable amount. This impairment test is performed during
the annual period and at the same time every period.
- tests goodwill acquired in a business combination for impairment annually.
If there is any indication that an asset may be impaired, the recoverable
amount is estimated for the individual asset. If it is not possible to
estimate the recoverable amount of the individual asset, the recoverable
amount of the cash-generating unit to which the asset belongs is determined.
The recoverable amount of an asset or a cash-generating unit is the higher of
its fair value less costs to sell and its value in use.
If the recoverable amount of an asset is less than its carrying amount, the
carrying amount of the asset is reduced to its recoverable amount. That
reduction is an impairment loss.
An impairment loss of assets carried at cost less any accumulated depreciation
or amortisation is recognised immediately in profit or loss. Any impairment
loss of a revalued asset is treated as a revaluation decrease.
An entity assesses at each reporting date whether there is any indication that
an impairment loss recognised in prior periods for assets other than goodwill
may no longer exist or may have decreased. If any such indication exists, the
recoverable amounts of those assets are estimated.
The increased carrying amount of an asset other than goodwill attributable to
a reversal of an impairment loss does not exceed the carrying amount that
would have been determined had no impairment loss been recognised for the
asset in prior periods.
A reversal of an impairment loss of assets carried at cost less accumulated
depreciation or amortisation other than goodwill is recognised immediately in
profit or loss. Any reversal of an impairment loss of a revalued asset is
treated as a revaluation increase.
1.12 Share capital and equity
An equity instrument is any contract that evidences a residual interest in the
assets of an entity after deducting all of its liabilities.
Ordinary shares are classified as equity.
Incremental costs directly attributable to the issue of new shares or options
are shown in equity as a deduction, net of tax, from the proceeds.
1.13 Share based payments
Goods or services received or acquired in a share-based payment transaction
are recognised when the goods or as the services are received. A corresponding
increase in equity is recognised if the goods or services were received in an
equity-settled share-based payment transaction or a liability if the goods or
services were acquired in a cash-settled share-based payment transaction.
When the goods or services received or acquired in a share-based payment
transaction do not qualify for recognition as assets, they are recognised as
expenses.
For equity-settled share-based payment transactions the goods or services
received and the corresponding increase in equity are measured, directly, at
the fair value of the goods or services received provided that the fair value
can be estimated reliably.
If the fair value of the goods or services received cannot be estimated
reliably, their value and the corresponding increase in equity, indirectly,
are measured by reference to the fair value of the equity instruments granted.
For cash-settled share-based payment transactions, the goods or services
acquired and the liability incurred are measured at the fair value of the
liability. Until the liability is settled, the fair value of the liability is
re-measured at each reporting date and at the date of settlement, with any
changes in fair value recognised in profit or loss for the period.
If the share based payments granted do not vest until the counterparty
completes a specified period of service, group accounts for those services as
they are rendered by the counterparty during the vesting period, (or on a
straight line basis over the vesting period).
If the share based payments vest immediately the services received are
recognised in full.
For share-based payment transactions in which the terms of the arrangement
provide either the entity or the counterparty with the choice of whether the
entity settles the transaction in cash (or other assets) or by issuing equity
instruments, the components of that transaction are recorded, as a cash-
settled share-based payment transaction if, and to the extent that, a
liability to settle in cash or other assets has been incurred, or as an equity-
settled share-based payment transaction if, and to the extent that, no such
liability has been incurred.
1.14 Employee benefits
Short-term employee benefits
The cost of short-term employee benefits, (those payable within 12 months
after the service is rendered, such as paid vacation leave and sick leave,
bonuses, and non-monetary benefits such as medical care), are recognised in
the period in which the service is rendered and are not discounted.
The expected cost of compensated absences is recognised as an expense as the
employees render services that increase their entitlement or, in the case of
non-accumulating absences, when the absence occurs.
The expected cost of profit sharing and bonus payments is recognised as an
expense when there is a legal or constructive obligation to make such payments
as a result of past performance.
1.15 Provisions and contingencies
Provisions are recognised when:
- the group has a present obligation as a result of a past event;
- it is probable that an outflow of resources embodying economic benefits will
be required to settle the obligation; and
- a reliable estimate can be made of the obligation.
The amount of a provision is the present value of the expenditure expected to
be required to settle the obligation.
Where some or all of the expenditure required to settle a provision is
expected to be reimbursed by another party, the reimbursement shall be
recognised when, and only when, it is virtually certain that reimbursement
will be received if the entity settles the obligation. The reimbursement shall
be treated as a separate asset. The amount recognised for the reimbursement
shall not exceed the amount of the provision.
Provisions are not recognised for future operating losses.
A constructive obligation to restructure arises only when an entity:
- has a detailed formal plan for the restructuring, identifying at least:
- the business or part of a business concerned;
- the principal locations affected;
- the location, function, and approximate number of employees who will be
compensated for terminating their services;
- the expenditures that will be undertaken; and
- when the plan will be implemented; and
- has raised a valid expectation in those affected that it will carry out the
restructuring by starting to implement that plan or announcing its main
features to those affected by it.
After their initial recognition contingent liabilities recognised in business
combinations that are recognised separately are subsequently measured at the
higher of:
- the amount that would be recognised as a provision; and
- the amount initially recognised less cumulative amortisation.
Contingent assets and contingent liabilities are not recognised. Contingencies
are disclosed in note 39.
1.16 Revenue
Revenue from the sale of goods is recognised when all the following conditions
have been satisfied:
- the group has transferred to the buyer the significant risks and rewards of
ownership of the goods;
- the group retains neither continuing managerial involvement to the degree
usually associated with ownership nor effective control over the goods sold;
- the amount of revenue can be measured reliably;
- it is probable that the economic benefits associated with the transaction
will flow to the group; and
- the costs incurred or to be incurred in respect of the transaction can be
measured reliably.
Revenue is measured at the fair value of the consideration received or
receivable and represents the amounts receivable for goods and services
provided in the normal course of business, net of trade discounts and volume
rebates, and value added tax.
Interest is recognised, in profit or loss, using the effective interest rate
method.
1.17 Cost of sales
When inventories are sold, the carrying amount of those inventories is
recognised as an expense in the period in which the related revenue is
recognised. The amount of any write-down of inventories to net realisable
value and all losses of inventories are recognised as an expense in the period
the write-down or loss occurs. The amount of any reversal of any write-down of
inventories, arising from an increase in net realisable value, is recognised
as a reduction in the amount of inventories recognised as an expense in the
period in which the reversal occurs.
Contract costs comprise:
- costs that relate directly to the specific contract;
- costs that are attributable to contract activity in general and can be
allocated to the contract; and
- such other costs as are specifically chargeable to the customer under the
terms of the contract.
1.18 Translation of foreign currencies
Foreign currency transactions
A foreign currency transaction is recorded, on initial recognition in Rands,
by applying to the foreign currency amount the spot exchange rate between the
functional currency and the foreign currency at the date of the transaction.
At the end of the reporting period:
- foreign currency monetary items are translated using the closing rate;
- non-monetary items that are measured in terms of historical cost in a
foreign currency are translated using the exchange rate at the date of the
transaction; and
- non-monetary items that are measured at fair value in a foreign currency are
translated using the exchange rates at the date when the fair value was
determined.
Exchange differences arising on the settlement of monetary items or on
translating monetary items at rates different from those at which they were
translated on initial recognition during the period or in previous interim
financial results are recognised in profit or loss in the period in which they
arise.
When a gain or loss on a non-monetary item is recognised to other
comprehensive income and accumulated in equity, any exchange component of that
gain or loss is recognised to other comprehensive income and accumulated in
equity. When a gain or loss on a non- monetary item is recognised in profit or
loss, any exchange component of that gain or loss is recognised in profit or
loss.
Cash flows arising from transactions in a foreign currency are recorded in
Rands by applying to the foreign currency amount the exchange rate between the
Rand and the foreign currency at the date of the cash flow.
1.19 Operating segments
An operating segment is a component of an entity:
- that engages in business activities from which it may earn revenues and
incur expenses (including revenues and expenses relating to transactions with
other components of the same entity),
- whose operating results are regularly reviewed by the entity`s chief
operating decision maker to make decisions about resources to be allocated to
the segments and assess its performance, and
- for which discrete financial information is available.
Business segments for management purposes are those minerals and commodities
regarded as key to the company`s business model and which are actively managed
by the company. The company does not regard geographical segments as
reportable.
Notes to the Interim Financial Results
2. New Standards and Interpretations
2.1 Standards and interpretations effective and adopted in the current year
In the current year, the group has adopted the following standards and
interpretations that are effective for the current financial year and that are
relevant to its operations:
IAS 1 (Revised) Presentation of Financial Statements
The main revisions to IAS 1 (AC 101):
- Require the presentation of non-owner changes in equity either in a single
statement of comprehensive income or in an income statement and statement of
comprehensive income.
- Require the presentation of a statements of financial position at the
beginning of the earliest comparative period whenever a retrospective
adjustment is made. This requirement includes related notes.
- Require the disclosure of income tax and reclassification adjustments
relating to each component of other comprehensive income. The disclosures may
be presented on the face of the statement of comprehensive income or in the
notes.
- Allow dividend presentations to be made either in the statement of changes
in equity or in the notes only.
- Have changed the titles to some of the financial statement components, where
the `balance sheet` becomes the `statement of financial position` and the
`cash flow statement` becomes the `statement of cash flows.` These new titles
will be used in International Financial Reporting Standards, but are not
mandatory for use in financial statements.
The effective date of the standard is for years beginning on or after 01
January 2009.
The group has adopted the standard for the first time in the 2010 interim
financial results.
The adoption of this standard has not had a material impact on the results of
the company, but has resulted in more disclosure than would have previously
been provided in the interim financial results.
May 2008 Annual Improvements to IFRS`s: Amendments to IAS 1 Presentation of
Financial Statements
The amendment is to clarify that financial instruments classified as held for
trading in accordance with IAS 39 (AC 133) Financial Instruments: Recognition
and Measurement are not always required to be presented as current
assets/liabilities.
The effective date of the amendment is for years beginning on or after 01
January 2009.
The group has adopted the amendment for the first time in the 2010 interim
financial results.
The impact of the amendment is not material.
May 2008 Annual Improvements to IFRS`s: Amendments to IFRS 7 Financial
Instruments: Disclosures; IAS 32 Financial Instruments: Presentation; IAS 28
Investments in Associates and IAS 31 Interests in Joint Ventures
The amendment adjusted the disclosure requirements of investments in
associates and interests in joint ventures which have been designated as at
fair value through profit or loss or are classified as held for trading. The
amendment provides that only certain specific disclosure requirements of IAS
28 (AC 110) Investments in Associates and IAS 31 (AC 119) Interests in Joint
Ventures are required together with the disclosures of IFRS 7 (AC 144)
Financial Instruments: Disclosures; IAS 32 (AC 125) Financial Instruments:
Presentation.
The effective date of the amendment is for years beginning on or after 01
January 2009.
The group has adopted the amendment for the first time in the 2010 interim
financial results.
The impact of the amendment is not material.
May 2008 Annual Improvements to IFRS`s: Amendments to IAS 39 Financial
Instruments: Recognition and Measurement
IAS 39 (AC 133) prohibits the classification of financial instruments into or
out of the fair value through profit or loss category after initial
recognition. The amendments set out a number of changes in circumstances that
are not considered to be reclassifications for this purpose.
The amendments have also removed references to the designation of hedging
instruments at the segment level.
The amendments further clarify that the revised effective interest rate
calculated when fair value hedge accounting ceases, in accordance with
paragraph 92 IAS 39 (AC 133) should be used for the remeasurement of the
hedged item when paragraph AG8 of IAS 39 (AC 133) is applicable.
The effective date of the amendment is for years beginning on or after 01
January 2009. The group has adopted the amendment for the first time in the
2010 interim financial results. The impact of the amendment is not material.
2.2 Standards and interpretations not yet effective
The group has chosen not to early adopt the following standards and
interpretations, which have been published and are mandatory for the group`s
accounting periods beginning on or after 01 July 2010 or later periods:
May 2008 Annual Improvements to IFRS`s: Amendments to IFRS 5 Non-current
Assets Held for Sale and Discontinued Operations
The amendment clarifies that assets and liabilities of a subsidiary should be
classified as held for sale if the parent is committed to a plan involving
loss of control of the subsidiary, regardless of whether the entity will
retain a non-controlling interest after the sale.
The effective date of the amendment is for years beginning on or after 01 July
2009.
The group expects to adopt the amendment for the first time in the 2011
interim financial results.
It is unlikely that the amendment will have a material impact on the company`s
interim financial results.
2009 Annual Improvements Project: Amendments to IAS 38 Intangible Assets
The amendment provides guidance on the measurement of intangible assets
acquired in a business combination. The effective date of the amendment is for
years beginning on or after 01 July 2009.
The group expects to adopt the amendment for the first time in the 2011
interim financial results.
It is unlikely that the amendment will have a material impact on the company`s
interim financial results.
3. Property, plant and equipment
Group 2010
Cost/Valuation Accumulated Carrying
depreciation value
R`000 R`000 R`000
Land 25 856 - 25 856
Buildings 910 (41) 869
Chemical Plant 3 746 - 3 746
Cement manufacturing plant 127 531 - 127 531
Furniture and fixtures 994 (165) 829
Motor vehicles - - -
Office equipment 550 (87) 463
IT equipment 2 345 (813) 1 532
Ash processing plant 71 503 (3 415) 68 088
Milling plant 3 856 - 3 856
Field equipment 220 (22) 198
Total 237 511 (4 543) 232 968
Group 2009
Cost/ Accumulated Carrying
Valuation depreciation value
R`000 R`000 R`000
Land 4 387 - 4 387
Buildings 931 - 931
Chemical Plant - - -
Cement manufacturing plant 112 212 - 112 212
Furniture and fixtures 1 233 (229) 1 004
Motor vehicles 1 891 (568) 1 323
Office equipment 393 (101) 292
IT equipment 2 370 (670) 1 700
Ash processing plant 18 742 - 18 742
Milling plant 335 - 335
Field equipment 88 (31) 57
Total 142 582 (1 599) 140 983
Reconciliation of property, plant and equipment - Group - 2010
Opening Additions Additions
balance through
business
combinations Disposals
R`000 R`000 R`000 R`000
Land 4 387 - 21 469 -
Buildings 931 - - -
Chemical plant - 3 746 - -
Cement manufacturing 112 212 15 319 - -
plant
Furniture and fixtures 1 004 417 - (464)
Motor vehicles 1 323 - - (1 323)
Office equipment 292 461 - (231)
IT equipment 1 700 994 - (522)
Ash processing plant 18 742 52 761 - -
Milling plant 335 3 521 - -
Field equipment 57 219 - (56)
Total 140 983 77 438 21 469 (2 596)
Transfers Depreciation Total
R`000 R`000 R`000
Land - - 25 856
Buildings (21) (41) 869
Chemical plant - - 3 746
Cement manufacturing - - 127 531
plant
Furniture and fixtures - (128) 829
Motor vehicles - - -
Office equipment 21 (80) 463
IT equipment - (640) 1 532
Ash processing plant - (3 415) 68 088
Milling plant - - 3 856
Field equipment - (22) 198
Total - (4 326) 232 968
Reconciliation of property, plant and equipment - Group - 2009
Opening Additions Disposals
balance
R`000 R`000 R`000
Land 2 343 2 044 -
Buildings - 931 -
Cement manufacturing plant - 112 212 -
Furniture and fixtures 573 1 036 -
Motor vehicles 1 498 1 506 -
Office equipment 319 265 -
IT equipment 585 2 125 -
Ash processing plant - 18 742 -
Milling plant - 335 -
Field equipment 67 69 (6)
5 385 139 265 (6)
Other information
Carrying value of property, 199 475
plant and equipment under
construction
Classified as
held for sale Depreciation Total
R`000 R`000 R`000
Land - - 4 387
Buildings - - 931
Cement manufacturing plant - - 112 212
Furniture and fixtures (465) (140) 1 004
Motor vehicles (1 323) (358) 1 323
Office equipment (231) (61) 292
IT equipment (522) (488) 1 700
Ash processing plant - - 18 742
Milling plant - - 335
Field equipment (56) (17) 57
(2 597) (1 064) 140 983
Other information
Carrying value of property, 131 290 - -
plant and equipment under
construction
Details of properties
Portion 10 of the farm Klein
Westerford 78IO (335,7727 ha)
and portion 8 of the farm
Klein Westerford 78IO
(321,7982 ha) is reconciled
into portion 17 on 30
September 2008.
- Purchase price: 1 March 2008 2 244 2 244 - -
- Capitalised expenditure 27 27 - -
2 271 2 271 - -
Remaining portion of the farm
Klein Westerford 78IO
(328,9083 ha)
- Purchase price: 12 February 2 100 2 100 - -
2008
- Capitalised expenditure 16 16 - -
2 116 2 116 - -
Portion1 1 of the farm Klein
Westerford 78IO (1576010 ha)
- Purchase price: 31 August 850 - - -
2007
- Capitalised expenditure 122 - - -
972 - - -
Remaining extension of Portion
22 of the farm Witklip no 232
(769004 ha)
- Purchase price: 9 November 19 000 - - -
2009
- Capitalised expenditure 1 497 - - -
20 497 - - -
Portion 4 of Erf 268
Lichtenburg
- Purchase price: 30 September 880 880 - -
2008
- Capitalised expenditure 30 30 - -
910 910 - -
A register containing the information required by paragraph 22(3) of Schedule
4 of the Companies Act is available for inspection at the registered office of
the company.
4. Goodwill
Group 2010
Cost Accumulated Carrying
value
impairment impairment
R`000 R`000 R`000
Goodwill on acquisition of 3 749 - 3 749
subsidiaries
Group 2009
Cost Accumulated Carrying
value
impairment impairment
R`000 R`000 R`000
Goodwill on acquisition of 749 - 749
subsidiaries
Reconciliation of goodwill - Group - 2010
Additions
through
Opening business
balance combinations Total
R`000 R`000 R`000
Goodwill 749 3 000 3 749
Reconciliation of goodwill - Group
- 2009
Opening Total
balance
R`000 R`000
Goodwill 749 749
5. Intangible assets
Group 2010
Cost/Valuation Accumulated Carrying
amortisation value
Computer software 6 001 (2 761) 3 240
Exploration assets 65 885 65 885 44 411
Total 71 886 (2 761) 69 125
Group 2009
Cost/Valuation Accumulated Carrying
amortisation value
R`000 R`000 R`000
Computer software 3 652 (885) 2 767
Exploration assets - 44 411
Total 48 063 (885) 47 178
Reconciliation of intangible assets - Group - 2010
Opening Additions Disposals
balance
Computer software 2 767 3 043 (370)
Exploration assets 44 411 30 622 -
47 178 33 665 (370)
Amortisation Impairment loss Total
Computer software (2 200) - 3 240
Exploration assets - (9 148) 65 885
(2 200) (9 148) 69 125
Reconciliation of intangible assets - Group - 2009
Opening Additions Classified
balance as held
for sale
Computer software 470 3 440 (370)
Exploration assets 31 946 12 471 -
32 416 15 911 (370)
Amortisation Impairment Total
loss
Computer software (773) - 2 767
Exploration assets - (6) 44 411
(773) (6) 47 178
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
6. Investments in subsidiaries
Name of company % holding % holding Carrying Carrying
2010 2009 amount amount
2010 2009
R`000 R`000
Sephaku Cement (Pty) Ltd 80.22% 80.22% 434 610 434 610
Sephaku Gold Holdings (Pty) Ltd -% 100.00% - -
Sephaku Fluoride (Pty) Ltd 100.00% 100.00% 10 10
Sephaku Coal Holdings (Pty) Ltd 100.00% 100.00% - -
Sephaku PGM Holdings (Pty) Ltd 100.00% 100.00% - -
Sephaku Management (Pty) Ltd -% 100.00% - -
Sephaku Tin (Pty) Ltd 100.00% 100.00% - -
Sephaku Vanadium (Pty) Ltd 100.00% 100.00% - -
Aquarella Investments 555 (Pty) 100.00% 100.00% - -
Ltd
Blue Waves Properties 198 (Pty) -% 100.00% - -
Ltd
Sephaku Uranium (Pty) Ltd 100.00% 100.00% - -
Ergomark (Pty) Ltd 100.0% -% - -
Sephaku Limestone & Exploration 51.00% -% 3 000 -
(Pty) Ltd
Dala Exploration Holdings (Pty) 100.00% -% - -
Ltd
437 620 434 620
The carrying amounts of subsidiaries are shown net of impairment losses.
All the subsidiaries are registered and operate within South Africa.
On 1 March 2009 all the shares in Sephaku Management (Pty) Ltd were
transferred to the Samet Trust.
On 27 January 2010 all the shares in Sephaku Gold Holdings (Pty) Ltd were sold
to the Wu Group for R60m.
On 31 October 2009 all the shares in Blue Waves Properties 198 (Pty) Ltd were
sold to Sephaku Cement (Pty) Ltd for R30m.
7. Investments in associates Name of company
Carrying Carrying
2010 2009 amount 2010 amount 2009
R`000 R`000
Taung Gold (Pty) Ltd -% 30.00% - 29 343
Sephaku Gold Exploration -% 30.00% - 8 923
(Pty) Ltd Golden Dividend
524 (Pty) Ltd
Defacto Investments 275 26.00% 26.00% - -
(Pty) Ltd Private Preview
Investments 39 (Pty) Ltd
African Spirit Trading 364 26.00% 26.00% - -
(Pty) Ltd
-% 48.00% - -
Egonox (Pty) Ltd 30.00% -% - -
Insa Coal Holdings (Pty) Ltd 50.00% -% - -
Synchrophor (Pty) Ltd 30.00% -% - -
Indelum Properties (Pty) Ltd 30.00% -% - -
Synchrotrix (Pty) Ltd 30.00% -% - -
Concreco (Richards 25.00% -% - -
Bay) (Pty) Ltd
Empivert (Pty) Ltd 30.00% -% - -
Finishing Touch 26.00% -% - -
Trading 121 (Pty) Ltd
Vigacron (Pty) Ltd 30.00% -% - -
African Nickel Holdings -% 26.00% - -
(Pty) Ltd
- 38 266
The carrying amounts of Associates are shown net of impairment losses.
All the associates are unlisted.
On 27 January 2010 the interest in African Nickel Holdings (Pty) Ltd was sold
to the Wu Group for R20m, as well as Sephaku Gold Holdings (Pty) Ltd being a
30% shareholder of Taung Gold Ltd and Sephaku Gold Exploration (Pty) Ltd for
an amount of R60m.
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
8. Loans to (from) group companies
Subsidiaries
Sephaku Cement (Pty) Ltd - - (2 671) (1 899)
Sephaku Gold Holdings (Pty) Ltd - - - 31 626
Sephaku Fluoride (Pty) Ltd - - 1 699 944
Sephaku Coal Holdings (Pty) Ltd - - 1 212 27
Sephaku PGM Holdings (Pty) Ltd - - 101 12
Sephaku Management (Pty) Ltd - - - 74 167
Sephaku Tin (Pty) Ltd - - 1 739 1 725
Sephaku Vanadium (Pty) Ltd - - 5 -
Aquarella Investments 555 (Pty) Ltd - - - 375
Nokeng Fluorspar Mine (Pty) Ltd - - 377 187
Sephaku Developments (Pty) Ltd - - - -
Sephaku Limestone & Exploration - - 948 -
(Pty) Ltd
- - 3 410 107 164
The loans are unsecured, bear no interest and are repayable on demand.
Associates
Taung Gold Ltd - 7 731 - -
Sephaku Gold Exploration (Pty) Ltd - 161 - 164
African Nickel Holdings (Pty) Ltd - (12) - -
African Spirit Trading 364 (Pty) Ltd - 1 - -
Golden Dividend 524 (Pty) Ltd 56 28 56 -
56 7 909 56 164
The loans are unsecured, bear no interest and are repayable on demand.
Current assets 56 8 019 6 137 109 227
Current liabilities - (110) (2 671) (1 899)
56 7 909 3 466 107 328
9. Loans to (from) shareholders
Dangote Industries 906 - - -
Loan is unsecured, bear no interest and is repayable on demand.
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
10. Other financial assets
Available-for-sale
Unlisted shares - 375 - -
- 375 - -
Available-for-sale (impairments) - (175) - -
- 200 - -
Loans and receivables
African Precious Minerals Ltd - (171) - (29)
African Nickel Ltd - 250 - 1
Platmin Investments Ltd - - - -
Mineral Afrique Ltd 31 33 31 31
Mozambique Biofuel Industrios - - - -
Sephaku Management (Pty) Ltd 24 975 - 79 280 -
Other loans - 401 - -
The loans are unsecured, bear no
interest and are repayable on
demand.
25 006 112 79 311 3
25 006 513 79 311 3
Total other financial assets 25 006 713 79 311 3
Non-current assets
Available-for-sale - 200 - -
Current assets
Loans and receivables 25 006 513 79 311 3
25 006 713 79 311 3
11. Financial assets by category
The accounting policies for financial instruments have been applied to the
line items below:
Group - 2010
Loans and
receivables Total
R`000 R`000
Loans to group companies 55 55
Loans to shareholders 906 906
Other financial assets 36 983 36 983
Loans to directors, managers and employees 1 1
Trade and other receivables 72 695 72 695
Cash and cash equivalents 40 159 40 159
Other loans receivable 336 336
151 135 151 135
Group - 2009
Loans and Available-for
receivables sale Total
R`000 R`000 R`000
Loans to group companies 8 018 - 8 018
Other financial assets 512 200 712
Loans to directors, managers and 25 - 25
employees
Trade and other receivables 928 - 928
Cash and cash equivalents 264 033 - 264 033
Other loan 941 - 941
274 457 200 274 657
Company - 2010
Loans and
receivables Total
R`000 R`000
Loans to group companies 6 137 6 137
Loans to directors, managers and employees 1 1
Other financial assets 84 850 84 850
Trade and other receivables 70 359 70 359
Cash and cash equivalents 8 712 8 712
170 059 170 059
Company - 2009
Loans and
receivables Total
R`000 R`000
Loans to group companies 109 225 109 225
Other financial assets 2 2
Loans to directors, managers and employees 1 1
Cash and cash equivalents 12 843 12 843
122 071 122 071
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
12. Deferred tax
Deferred tax asset
Deferred tax (2 152) - - -
Reconciliation of deferred tax
asset (liability)
Deferred tax asset on assessed 6 683 - - -
loss limited to taxable
differences
Originating temporary difference (7 052) - - -
from Kendal Plant
Originating temporary difference (2 151) - - -
on business combinations
Leave provision 653 - - -
Prepaid expenses (285) - - -
(2 152) - - -
Recognition of deferred tax asset
An entity shall disclose the amount of a deferred tax asset and the nature of
the evidence supporting its recognition, when:
- the utilisation of the deferred tax asset is dependent on future taxable
profits in excess of the profits arising from the reversal of existing taxable
temporary differences; and
- the entity has suffered a loss in either the current or preceding period in
the tax jurisdiction to which the deferred tax asset relates.
Sephaku Cement (Pty) Ltd has incurred an assessed loss of R62 192 504 in the
current year. It has become operational during the current financial year and
is expected to make taxable profits in the foreseeable future against which
this loss can be set off.
Unrecognised deferred tax asset
R`000 R`000 R`000 R`000
Deductible temporary differences 77 082 - - -
not recognised as deferred tax
assets
13. Deposits for rehabilitation
In terms of section 41 of the Minerals and Petroleum Development Act an
applicant for a prospecting right, mining right or mining permit must make the
prescribed financial provision for the rehabilitation or management of
negative environmental impacts. The group made deposits with the Department of
Minerals and Energy in compliance herewith.
14. Other loans receivable
Sinoma International Engineering Co Ltd - a loan to the amount of R336 117 was
provided during the period under review. This loan is unsecured, interest free
and has no fixed terms of repayment.
15. Loans to directors, managers and employees
Loans to directors, managers and employees
R`000 R`000 R`000 R`000
At beginning of the year 26 452 2 2
Advances - 24 - -
Repayments (24) (450) - -
2 26 2 2
The loans to directors, managers and employees bear no interest and are
repayable on demand.
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
16. Trade and other receivables
Trade receivables 68 815 895 67 095 -
Prepayments 1 019 516 - -
Deposits 256 32 - -
VAT 901 2 735 560 220
70 991 4 178 67 655 220
17. Cash and cash equivalents
Cash and cash equivalents consist
of:
Cash on hand 61 39 - -
Bank balances 40 098 271 638 8 712 12 843
Other cash and cash equivalents - - - -
40 159 271 677 8 712 12 843
Credit quality of cash at bank and short term deposits, excluding cash on hand
The credit quality of cash at bank and short term deposits, excluding cash on
hand that are neither past due nor impaired can be assessed by reference to
external credit ratings (if available) or historical information about
counterparty default rates:
Credit rating
AAA 40 098 271 638 8 712 12 842
18. Discontinued operations or disposal groups or non-current assets held for
sale
The group discontinued its operations in Sephaku Management (Pty) Ltd as of 28
February 2009. The group continues to make use of the services provided by
Sephaku Management (Pty) Ltd. The assets and liabilities of the disposal group
are set out below.
Assets and liabilities
Assets of disposal groups
Associates - 1 170 - -
Trade and other receivables - 12 517 - -
Other assets - 431 - -
- 14 118 - -
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
19. Share capital
Authorised
150 000 000 Ordinary - 150 - 150
shares of R0.001 each
50 000 000 non-voting - 50 - 50
convertible
Preference shares of
R0.001 each - - - -
Current financial
year:
1000 000 000 Ordinary - 200 - 200
shares with no par
value
Reconciliation of
number of shares
issued:
Reported as at 01 151 081 802 102 990 340 151 081 801 102 990 340
March 2009
Issue of shares - 4 723 561 48 091 462 4 723 561 48 091 462
ordinary shares
155 805 363 151 081 802 155 805 362 151 081 802
The unissued ordinary
shares are under the
control of the
directors.
Issued
Ordinary 225 215 125 545 074 126
Preference - 25 - 25
Ordinary shares to be - 7 080 - 7 080
issued
Share premium - 207 751 - 530 027
225 215 214 981 545 074 537 258
20. Share based payments
Share Option Group Number Weighted Total value
exercise
price
R`000 R`000 R`000
Share options granted during 2008 200 000 1.50 300
year
Share options granted during the 5 740 000 2.50 14 350
2009 year
No share options were exercised during the period under review.
Share options of R12 423 vested during the period and is included in salary
expense.
Outstanding options
Exercise date Exercise date Exercise date
Within one from two to after five
year five years years
5 740 000 options with 1 794 133 -
exercise price of R2.50,
vesting over 3 years,
expiring 31/03/2015
200 000 options with 150 150 -
exercise price of R1.50
from 30/06/2008 to
30/06/2011
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
21. Other financial
liabilities
Held at amortised
cost
African Nickel Ltd 2 002 - 2 002 -
The loan is
unsecured, bear no
interest and is
repayable on demand.
Current liabilities
At amortised cost 2 002 - 2 002 -
22. Provisions
Reconciliation of
provisions - Group - 2010
Opening Additions Total
balance
R`000 R`000 R`000
Provision - 308 308
The R308 000 provision relates to a rebate provision of R37 and a provision
for software licences of R271.
23. Current tax payable (receivable)
An amount of R599 relates to current tax payable for the 2010 tax year (2009:
R645) (2008: R1 150 Capital Gains Tax payable)(2007: R2 303) and current tax
receivable of R3 relates to 2010 tax year.
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
24. Trade and other payables
Trade payables 6 139 9 256 357 11 946
Staff claims 41 18 - -
Accrued leave pay 2 335 715 - -
Accrued medical aid contributions 466 20 - -
Accrued audit fees - 12 - -
Accrued expense 415 - - -
Accrual for salary related 3 914 - - -
expenses
13 310 10 021 357 11 946
25. Financial liabilities by category
The accounting policies for financial instruments have been applied to the
line items below:
Group - 2010
Financial
liabilities at
amortised cost Total
R`000 R`000
Other financial liabilities 2 002 2 002
Trade and other payables 10 971 10 971
12 973 12 973
Group - 2009
Financial
liabilities at
amortised cost Total
R`000 R`000
Loans from group companies 110 110
Loans from shareholders 10 10
Other financial liabilities 1 149 1 149
Trade and other payables 9 307 9 307
10 576 10 576
Company - 2010
Financial Total
liabilities at
amortised cost
R`000 R`000
Loans from group companies 2 671 2 671
Other financial liabilities 2 002 2 002
Trade and other payables 356 356
5 029 5 029
Company - 2009
Financial Total
liabilities at
amortised cost
R`000 R`000
Loans from group companies 1 899 1 899
Trade and other payables 11 943 11 943
13 842 13 842
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
26. Revenue
Sale of goods 2 509 - - -
27. Cost of sales
Sale of goods
Cost of goods sold 1 215 - - -
28. Operating profit
Operating (loss) profit for the year
is stated after accounting for the
following:
Operating lease charges
Premises
- Contractual amounts 916 518 - -
Equipment
- Contractual amounts 350 1 578 - -
1 266 2 096 - -
Profit on sale of non-current assets 32 290 (758) 56 000 -
Impairment on investment in 200 175 - -
associate
Amortisation on intangible assets 2 199 772 - -
Depreciation on property, plant and 4 326 1 064 - -
equipment
Employee costs 55 520 25 210 2 888 -
Auditors remuneration: Fees for 383 46 - -
audit services
Capital raising fee - 4 613 - -
Loss on non-current assets held for - - - -
sale or disposal groups
Impairment of intangible assets 9 148 6 - -
(Profit)/Loss on foreign exchange (946) (261) - -
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
29. Investment revenue
Interest revenue
Loans - 39 - -
Bank 11 915 29 916 - 55
Other interest 1 341 419 1 341 419
13 256 30 374 1 341 474
30. Finance costs
Trade and other payables - 2 - -
Finance leases - 47 - -
Bank 2 222 - -
Department of Mineral Resources 8 - - -
10 271 - -
31. Taxation
Major components of the tax
expense
Current
Local income tax - current period 150 644 - -
Reconciliation of the tax expense
Reconciliation between accounting
profit and tax expense.
Accounting (loss) profit (56 151) (9 853) 40 873 (7 331)
Tax at the applicable tax rate of (15 722) (2 759) 11 444 (2 047)
28% (2009: 28%)
Tax effect of adjustments on
taxable income
(Non-taxable)/non-deductible (9 443) 656 (8 656) -
differences
Unprovided tax loss 33 752 3 714 - 2 047
Utilisation of unprovided tax loss (6 683) (967) (965) -
1 904 644 1 823 -
The income tax rate of 29% in 2008 was reduced to 28% in 2009.
Current tax provided relates to the taxable income of Sephaku Development
(Pty) Ltd. The other companies in the group have no taxable income for the
year ending.
32. Auditors` remuneration
R`000 R`000 R`000 R`000
Fees for audit services 385 46 218 5
33. Other comprehensive income
Components of other comprehensive income - Group - 2010
Gross Tax Net Non- Net
controlling
interest
R`000 R`000 R`000 R`000 R`000
Effects of cash flow
hedges
Gains (losses) on (53 178) - (53 178) 10 636 (42 542)
cash flow hedges
arising during the
year
Sephaku Cement (Pty) Ltd entered into an agreement with Sinoma International
Engineering Co Limited for the provision of a turnkey cement manufacturing
facility at a total cost of USD273m. The first cash flow is a deposit of 20%
which is regarded as a firm commitment. The cash flow risk associated with the
foreign exchange payment was hedged by means of a foreign exchange contract.
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
34. Cash used in operations
(Loss) profit before taxation (56 151) (9 853) 40 873 (7 331)
Adjustments for:
Depreciation and amortisation 6 525 1 837 - -
Profit on sale of non-current (32 290) (758) (56 000) -
assets
Loss from equity accounted 2 102 1 964 242 -
investments
Interest received (13 256) (30 374) (1 341) (474)
Finance costs 10 271 - -
Loans written off 920 - 917 -
Impairment of investment in 200 175 - -
associate
Other non-cash items (229) - - -
Movements in provisions 308 - - -
Exploration cost written off 9 148 6 - -
Share options recorded 2 648 - 2 648 -
against salary expense
Changes in working capital:
Trade and other receivables 13 648 13 042 8 384 (220)
Trade and other payables (16 481) 7 693 (11 589) 6 789
(82 898) (15 997) (15 866) (1 236)
35. Tax paid
Balance at beginning of the (4 098) (3 454) (1 150) (1 150)
year
Current tax for the year (150) (644) - -
recognised in profit or loss
Balance at end of the year 1 746 4 098 1 150 1 150
(2 502) - - -
36. Acquisition of businesses
Fair value of assets acquired
Property, plant and equipment 21 468 - - -
Intangible assets - 11 773 - -
Goodwill 3 000 - 3 000 -
Trade and other receivables 542 - - -
Trade and other payables (10) - - -
Tax assets / liabilities (2 151) - - -
Inter-company loan accounts (7 632) - - -
15 217 11 773 3 000 -
Consideration paid
Cash (22 850) (11 773) (3 000) -
Loan accounts 7 633 - - -
(15 217) (11 773) (3 000) -
Net cash outflow on
acquisition
Cash consideration paid (22 850) (11 773) (3 000) -
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
37. Sale of businesses
37.1 Sale of non-equity
accounted businesses
Carrying value of assets sold
Property, plant and equipment (2 597) - - -
Intangible assets (370) - - -
Retained income (3 713) - - -
Loans to directors, managers, (5) - - -
employees
Investment (6 707) - - -
Investment in associates (38 274) - (1 761) -
Trade and other receivables (82) - - -
Trade and other payables 565 - - -
Other loans and receivables (107) - - -
Inter-company loans 86 235 - (42 789) -
Leave provision 361 - - -
Assets of disposal groups (32 880) - - -
Other loans (5 270) - (5 270) -
Total net assets sold (2 844) - (49 820) -
Net assets sold (2 844) - (49 820) -
Profit on disposal (32 290) (758) (56 000) -
(35 134) (758) (105 820) -
Consideration received
Cash - - 30 000 -
Debtor 80 000 - 80 000 -
Loan accounts (40 437) - - -
39 563 - 110 000 -
Net cash outflow on
acquisition
Cash consideration received - - 30 000 -
R`000 R`000 R`000 R`000
38. Commitments
Authorised capital
expenditure
Already contracted for but
not provided for
Purchase of shares in West - 19 000 - 19 000
Dune Properties (Pty) Ltd
Ash Plant 5 147 51 458 5 147 51 458
Sephaku Cement entered into an agreement on 10 December 2008 with PMB M.E.I.P
Construction Services CC for the design and construction of the Ash plant to
the value of R55 663 443. As part of this agreement two MCS-600 Air
Classification systems of USD 1 108 370 are supplied by RSG Inc. Atlanta. The
agreement commenced on 19 November 2008.
R`000 R`000 R`000 R`000
Operating leases - as lessee
(expense)
Minimum lease payments due
- within one year - 2 018 - -
- in second to fifth year - - - -
inclusive
- 2 018 -
Operating lease payments represent rentals payable by the group for certain of
its office properties. Leases are negotiated for an average term of seven
years and rentals are fixed for an average of three years. No contingent rent
is payable.
39. Contingencies Litigation is in the process against the company relating to
a dispute with a potential supplier who alleges that the company has verbally
agreed to acquire plant and is seeking damages of R 8 000 000. The group`s
lawyers and management consider the likelihood of the action against the
company being successful as unlikely, and the case should be resolved within
the next year.
Sephaku Development (Pty) Ltd issued a bank guarantee to the Department of
Minerals and Energy for the amount of R6 859 281 to guarantee the potential
cost of rehabilitation in respect of a mining right granted.
Sephaku Cement (Pty) Ltd has ceded R1 50 000 in favour of ABSA Bank Ltd in
respect of ABSA credit card facilities.
Sephaku Cement (Pty) Ltd has issued a guarantee for the amount of R410 000 to
Eskom for the self built of a temporary electricity supply facility.
40. Related parties
Relationships
Subsidiaries Refer to note 6
Associates Refer to note 7
Members of key management
L Mohuba
NR Crafford-Lazarus
ME Smit
RR Matjiu
CR de Wet de Bruin
PF Fourie
GS Mahlati
MM Ngoasheng
MG Mahlare D Twist
J Bennette JW Wessels
Companies with common directors The Makings (Pty) Ltd
Sephaku Management (Pty) Ltd Mineral
Afrique Plc
African Nickel Ltd
Related party balances
Group Company
2010 2009 2010 2009
R`000 R`000 R`000 R`000
Loan accounts - Owing (to) by
related parties
Taung Gold Ltd and subsidiaries - (7 731) - -
Sephaku Gold Exploration (Pty) Ltd - (161) - (164)
African Nickel Holdings (Pty) Ltd (2 002) 12 (2 002) -
and subsidiaries
African Spirit Trading 364 (Pty) - (1) - -
Ltd
Golden Dividend 524 (Pty) Ltd (56) (28) (56) -
Sephaku Management (Pty) Ltd (24 975) - (79 280) -
J Bennette - - - -
Amounts included in Trade
receivable (Trade Payable)
regarding related parties
Taung Gold Ltd and subsidiaries - - - -
Sephaku Gold Exploration (Pty) Ltd - (586) - -
African Nickel Holdings (Pty) Ltd - (632) - -
and subsidiaries
Golden Dividend 524 (Pty) Ltd - (43) - -
Related party transactions
Administration fees paid to
(received from) related parties
Taung Gold Ltd and subsidiaries - 1 796 - -
Sephaku Gold Exploration (Pty) Ltd - 12 - -
African Nickel Holdings (Pty) Ltd - 233 - -
and subsidiaries
Golden Dividend 524 (Pty) Ltd - 1 - -
Sephaku Management (Pty) Ltd 9 654 - 6 437 -
41. Directors` emoluments
Executive
2010 Fees for
services as Performance Pension Medical
Remuneration director bonuses fund Aid Total
R`000 R`000 R`000 R`000 R`000 R`000
L Mohuba 1 112 - 39 - - 1 151
NR 1 711 - - - - 1 711
Crafford-
Lazarus
ME Smit 1 391 - - - - 1 391
RR Matjiu 713 - - - - 713
JW 285 - 15 - - 300
Wessels
J 450 - 5 - - 455
Bennette
5 662 - 59 - - 5 721
2009 Remuneration Fees for
services as Performance Pension Medical
director bonuses fund Aid Total
R`000 R`000 R`000 R`000 R`000 R`000
L Mohuba 726 - - - - 726
NR 1 555 - - - - 1 555
Crafford-
Lazarus
ME Smit 540 823 - - - 1 363
RR Matjiu 648 - - - - 648
J 409 - - - - 409
Bennette
3 878 823 - - - 4 701
Non-
executive
2010 Remuneration Fees for
services as Performance Pension Medical
director bonuses fund Aid Total
R`000 R`000 R`000 R`000 R`000 R`000
CR de W - 1 426 39 - - 1 465
de Bruin
PF Fourie - 1 892 - 122 55 2 069
D Twist - 1 426 39 - - 1 465
- 4 744 78 122 55 4 999
2009 Remuneration Fees for
services as Performance Pension Medical
director bonuses fund Aid Total
R`000 R`000 R`000 R`000 R`000 R`000
CR de W 991 - - - - 991
de
Bruin
D Twist 108 396 - - - 504
GS 280 - - - - 280
Mahlati
1 379 396 - - - 1 775
Details of service contracts
None of the directors of the company have written service contracts with the
company. Directors are employed by the board and rotate in terms of the
Articles of Association. Certain key directors of the subsidiaries are
employed on 5 year contracts.
42. Risk management
Capital risk management
The group`s objectives when managing capital are to safeguard the group`s
ability to continue as a going concern in order to provide returns for
shareholder and benefits for other stakeholders and to maintain an optimal
capital structure to reduce the cost of capital.
In order to maintain or adjust the capital structure, the group may adjust the
amount of dividends paid to shareholder, return capital to shareholder, issue
new shares or sell assets to reduce debt.
Due to the nature of the business and the lack of cash flow the company limits
its capital resources to equity only. There are no externally imposed capital
requirements.
There have been no changes to what the entity manages as capital, the strategy
for capital maintenance or externally imposed capital requirements from the
previous year.
Financial risk management
The group`s activities expose it to a variety of financial risks: market risk
(including currency risk, fair value interest rate risk, cash flow interest
rate risk and price risk), credit risk and liquidity risk.
The group`s overall risk management program focuses on the unpredictability of
financial markets and seeks to minimise potential adverse effects on the
group`s financial performance. The group uses derivative financial instruments
to hedge certain risk exposures. Risk management is carried out by a central
treasury department (group treasury) under policies approved by the board.
Group treasury identifies, evaluates and hedges financial risks in close co-
operation with the group`s operating units. The board provides written
principles for overall risk management, as well as written policies covering
specific areas, such as foreign exchange risk, interest rate risk, credit
risk, use of derivative financial instruments and non-derivative financial
instruments, and investment of excess liquidity.
Liquidity risk
The group`s risk to liquidity is a result of the funds available to cover
future commitments. The group manages liquidity risk through an ongoing review
of future commitments and credit facilities.
Cash flow forecasts are prepared and adequate utilised borrowing facilities
are monitored.
Interest rate risk
As the group has no significant interest-bearing assets, the group`s income
and operating cash flows are substantially independent of changes in market
interest rates.
The group analyses its interest rate exposure on a dynamic basis. Various
scenarios are simulated taking into consideration refinancing, renewal of
existing positions, alternative financing and hedging. Based on these
scenarios, the group calculates the impact on profit and loss of a defined
interest rate shift. For each simulation, the same interest rate shift is used
for all currencies.
Credit risk
Credit risk is managed on a group basis.
Credit risk consists mainly of cash deposits, cash equivalents, derivative
financial instruments and trade debtors. The company only deposits cash with
major banks with high quality credit standing and limits exposure to any one
counter-party.
42. Foreign exchange risk
The group operates internationally and is exposed to foreign exchange risk
arising from various currency exposures, primarily with respect to the US
dollar and the Euro. Foreign exchange risk arises from future commercial
transactions.
The group treasury`s risk management policy is to hedge between 75% and 100%
of anticipated cash flows (mainly purchase of capital equipment) in each major
foreign currency for the subsequent 6 months.
The group reviews its foreign currency exposure, including commitments on an
ongoing basis. The company expects its foreign exchange contracts to hedge
foreign exchange exposure.
The group previously did not have foreign exchange transactions and did not
require a hedging policy.
43. Going concern
The interim financial results have been prepared on the basis of accounting
policies applicable to a going concern. This basis presumes that funds will be
available to finance future operations and that the realisation of assets and
settlement of liabilities, contingent obligations and commitments will occur
in the ordinary course of business.
44. Events after the reporting period
The group announced during January 2010 that it will unbundle its exploration
assets. This process is currently being planned and shareholders should be
given notice of a shareholders meeting to approve the unbundling within the
next few weeks.
The group has also agreed to raise additional capital through equity and debt
for its proposed cement operation. This will also be dealt with in detail in
the above mentioned notice to shareholders.
Group
2010 2009
R`000 R`000
45. Net asset value per share and earnings per
share
Net asset value and tangible net asset value
per share
Total assets 443 867 527 181
Total liabilities (19 517) (14 241)
Minority interest (60 578) (83 579)
Net asset value attributable to equity holders 363 772 429 361
of parent
Goodwill (3 749) (749)
Intangible assets (69 123) (47 177)
Tangible net asset value 290 900 381 435
Shares in issue 155 804 561 151 081 000
Net asset value per share (cents) 233.48 284.19
Tangible net asset value per share (cents) 186.71 252.47
Earnings and headline earnings per share
Reconciliation of basic earnings to diluted
earnings and headline earnings:
Basic earnings/(loss) and diluted (43 932) (11 046)
earnings/(loss) attributable to equity holders
of parent
Profit on sale of non-current assets (32 290) (758)
Impairment of intangible assets 9 148 6
Impairment of investment in associate 200 175
Headline earnings/(loss) attributable to equity (66 874) (11 622)
holders of parent
Reconciliation of basic weighted average number
of shares to diluted weighted average number of
shares:
Basic weighted average number of shares 155 209 263 124 331 930
Dilutive effect of share options 4 221 875 4 221 875
Diluted weighted average number of shares 159 431 138 128 553 805
Basic earnings/(loss) per share (cents) (28.31) (8.88)
Diluted earnings/(loss) per share (cents) (27.56) (8.59)
Headline earnings/(loss) per share (cents) (43.09) (9.35)
Diluted headline earnings/(loss) per share (41.95) (9.04)
(cents)
Basic earnings/(loss) per share
The calculation of basic earnings/(loss) per share of (28.31) cents (2009:
(8.88) cents) is based on earnings/(loss) attributable to equity holders of
the parent of (R43 932 166) (2009: (R11 045 802)) and the weighted average of
155 209 263 (2009: 124 331 930) shares in issue during the year.
Diluted earnings/(loss) per share
The calculation of diluted earnings/(loss) per share of (27.56) cents (2009:
(8.59) cents) is based on earnings/(loss) attributable to equity holders of
the parent of (R43 932 166) (2009: (R11 045 802)) and the diluted weighted
average of 159 431 138 (2009: 128 553 805) shares in issue during the year.
Headline earnings/(loss) per share
The calculation of headline earnings/(loss) per share of (43.09) cents (2009:
(9.35) cents) is based on the headline earnings/(loss) attributable to equity
holders of the parent of (R66 873 714) (2009: (R11 622 444)) and the weighted
average of 155 209 263 (2009: 124 331 930) shares in issue during the year.
Diluted headline earnings/(loss) per share
The calculation of diluted headline earnings/(loss) per share of (41.95) cents
(2009: (9.04) cents) is based on headline earnings/(loss) attributable to
equity holders of the parent of (R66 873 714) (2009: (R11 622 444)) and the
diluted weighted average of 159 431 138 (2009: 128 553 805) shares.
46. Segment information
Management has determined the operating segments based on the information used
by the board to make strategic decisions. The board considers the business
primarily from a commodity perspective. The gold and nickel operations are not
classified as separate sectors, since the company is not primarily responsible
for the strategic decisions to be made in those businesses. The reportable
operating segments will derive their revenue primarily from the mining,
beneficiation and sale of the relevant minerals. Other services included refer
to the revenue gained from supplying infrastructure and services in mining and
exploration activities to related companies as well as the commodities which
have not yet reached strategic emphasis.
Segment information for the Group - 2010
Ash Cement Fluorspar Tin
Segment revenue (3 395) (1 003) - -
Segment expense 7 354 64 195 869 443
Segment result 3 959 63 192 869 443
Depreciation 3 514 3 011 - -
Interest received - (11 915) - -
Finance cost - 2 6 2
Income tax expense - 150 - -
Gain on disposal of - - - -
assets
Loss from equity
accounted investments
Segment assets 70 097 246 767 33 170 5 616
Total assets includes 52 943 48 146 26 460 451
additions to non-current
assets
Segment liability (6 819) (43 141) (37 923) (4 394)
Coal Other Consolidation
adjustment and Total
elimination
Segment revenue (516) (1 334) - (6 248)
Segment expense 9 465 16 778 - 99 105
Segment result 8 949 15 444 - 92 856
Depreciation - 200 - 6 725
Interest received - (1 341) - (13 256)
Finance cost - - - 10
Income tax expense - - - 150
Gain on disposal of - (32 290) - (32 290)
assets
Loss from equity - 2 101 - 2 101
accounted investments
Segment assets 3 845 168 126 (83 755) 443 866
Total assets includes - 4 066 506 132 572
additions to non-current
assets
Segment liability (15 902) (5 348) 94 010 (19 517)
Segment information for the Group - 2009
Cement Fluorspar Tin Coal
Segment revenue (301) - - -
Segment expense 22 211 144 194 2 975
Segment result 21 910 144 194 2 975
Depreciation 778 - - -
Interest received (25 246) - - -
Finance cost 221 - - -
Income tax expense 664 - - -
Fair value adjustment - - - -
Income from equity - - - -
accounted investments
Fair value adjustment - - - -
through profit/loss
Loss from discontinued - - - -
operations
Segment assets 437 091 1 269 (438) (174)
Total assets includes 167 372 6 967 4 267 5 884
additions to non-current
assets
Investment in associates - - - -
Non-current assets of - - - -
disposal group
Segment liabilities (13 986) (2 756) (268) (1 784)
Other Consolidation Total
adjustment and
elimination
Segment revenue - - (301)
Segment expense 9 713 (6 236) 29 003
Segment result 9 713 (6 236) 28 702
Depreciation 1 057 - 1 836
Interest received (474) - (25 720)
Finance cost - - 221
Income tax expense - - 664
Fair value adjustment 175 - 175
Income from equity 1 964 - 1 964
accounted investments
Fair value adjustment (757) - (757)
through profit/loss
Loss from discontinued 5 269 - 5 269
operations
Segment assets 78 672 284 940 801 362
Total assets includes 3 668 319 859 508 018
additions to non-current
assets
Investment in associates 38 266 - 38 266
Non-current assets of 32 966 (18 848) 14 117
disposal group
Segment liabilities (14 183) 18 738 (14 241)
Business segments for management purposes are those minerals and commodities
regarded as key to the company`s business model and which are actively managed
by the company. The company had two associates in Gold and Nickel, but these
associates were primarily managed by the majority shareholder and therefore
the company did not regard these as reportable segments.
The company operates only in South Africa and does not regard geographical
segments as reportable.
The Other section includes:
- unallocated management expenditure and other assets and liabilities;
- revenue from other non-group companies for expenditure charged to these
companies;
- any revenue and expenditure and assets and liabilities in respect of the
associate companies exploring for Gold and Nickel; and
- any revenue and expenditure and assets and liabilities in respect of the
smaller operations in Vanadium, Platinum, Chrome and Diamonds.
Date: 31/05/2010 17:50:01 Supplied by www.sharenet.co.za
Produced by the JSE SENS Department.
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