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Provisional Summary Audited Group Results For The Year Ended 31 March 2017 And Final Dividend Declaration
CROOKES BROTHERS LIMITED
(Incorporated in the Republic of South Africa)
Registration No. 1913/000290/06
Share code : CKS ISIN No: ZAE000001434
("Crookes Brothers" or "the company" or "the group")
PROVISIONAL SUMMARY AUDITED GROUP RESULTS
FOR THE YEAR ENDED 31 MARCH 2017 AND FINAL DIVIDEND DECLARATION
Comments on results
Revenue from continuing operations increased by 22% to R664 million (2016: R543
million), with the major contributions from the sugar and bananas segments, driven
mainly by high selling prices due to supply constraints caused by the drought. In
contrast, the deciduous operation suffered from a substantial decline in prices driven
by rand strength as well as the effects of a slump in oil and other commodity prices
impacting our African markets.
Operating profit increased by 73% to R125 million (2016: R72 million), despite a R10
million operating loss recorded in our deciduous fruit segment. Headline earnings per
share increased by 15.9% to 424.1 cents (2016: 366.0 cents).
Cash generated from operations increased by 5% to R102 million (2016: R97 million).
Community partnerships
A feature of our results is the substantial increase in profit attributable to non-
controlling interests of R31.3 million (2016: R1.1 million), consisting of our community
partners’ share of profit. As of 1 April 2016, CBL converted its rights to the balance of
a lease over a major portion of the 2500 ha Komati Estate to a 20 year
partnering arrangement with the Mawewe community.
The long term benefits are significant and this arrangement is in line with the group’s
empowerment and sustainability objectives. We are currently negotiating a similar
arrangement for the rest of the Komati farm.
Functional currency
Following a detailed assessment of our macadamia operation and banana joint
venture, both in Mozambique, it was concluded that the functional currency of both
these projects was Rands. This best reflects the operating reality and eliminates the
effect of Meticais volatility on earnings.
Change in bearer biological asset standard to property plant and equipment- IAS16
Retrospectively with effect from 1 April 2015, CBL adopted the accounting standard
change in respect of bearer biological assets. Bearer assets are now classified under
property, plant and equipment at cost, with no subsequent revaluations, and are
depreciated over the useful life of the crop. Details on the restatement are shown in
the consolidated annual financial statements
Prospects
The next 12 months will be challenging as we recover from the effects of the drought,
particularly in our cane segment in Mpumalanga. Our deciduous division continues
to be exposed to water risk due to the severe ongoing drought in the Western Cape.
The performance of the deciduous division in 2018 will depend on rainfall in the current
winter months.
With deciduous fruit orchards approaching maturity, an excellent first harvest from the
macadamia project and the start of the Renishaw property development during the
financial year under review, the group’s medium term prospects are promising.
It is noteworthy that approximately R400 million of assets reflected on the group’s
balance sheet are currently in development phase and will deliver an increased
contribution to profits from 2019.
We are confident that our financial goals of achieving long term headline earnings
growth of 15% per annum and a return in equity of 15% are attainable with the
maturing of these non-producing assets.
Project and capital expenditure
Planned project and capital expenditure for the next 12 months amounts to R226
million. We plan to extend our banking facilities to bring our ongoing projects to
production over the next two years. The additional cash flows generated from new
projects is targeted to drive the group into a free cash flow phase in 2019.
CASH DIVIDEND DECLARATION
The board of directors, ("the board") has resolved to declare a final gross cash
dividend of 115.0 cents per ordinary share ("the cash dividend") to ordinary
shareholders recorded in the register of the company at the close of business on
Friday, 7 July 2017.
In respect of the final gross cash dividend:
- the dividend has been declared from income reserves;
- the dividend withholding tax rate is 20% resulting in a net dividend of 92.0
cents per share to those shareholders who are not exempt from dividend
withholding tax;
- Crookes Brothers Limited tax reference number is 9696/001/71/9; and
- the issued number of shares as at declaration date is 15 264 317.
The cash dividend will be paid on Monday, 10 July 2017 to shareholders recorded in
the books of the company at close of business on the record date Friday, 7 July 2017.
The salient dates of the declaration and payment of these dividends are as follows:
Last day to trade cum-dividend Tuesday, 4 July 2017
Shares commence trading ex-dividend Wednesday, 5 July 2017
Record date Friday, 7 July 2017
Payment date Monday, 10 July 2017
Share certificates may not be dematerialised or re-materialised between Wednesday,
5 July 2017 and Friday, 7 July 2017, both days inclusive.
The above dividend is in addition to the interim dividend of 50.0 cents per share,
which was declared on 29 November 2017, and brings the aggregate dividend in respect
of the year ended 31 March 2017 to 165.0 cents (2016: 150.0 cents) per share.
BASIS OF PREPARATION
The provisional summary consolidated financial statements are prepared in
accordance with the requirements of the JSE Listings Requirements ("Listings
Requirements") for provisional reports, and the requirements of the Companies Act of
South Africa applicable to summary financial statements. The Listings Requirements
require provisional reports to be prepared in accordance with the framework
concepts and the measurement and recognition requirements of International
Financial Reporting Standards (IFRS), the SAICA Financial Reporting Guides as issued
by the Accounting Practices Committee and Financial Pronouncements as issued by
the Financial Reporting Standards Council, and to also, as a minimum, contain the
information required by IAS 34, Interim Financial Reporting. The accounting policies
applied in the preparation of the consolidated annual financial statements, from
which the summary consolidated financial statements were derived, are in terms of
IFRS and are consistent with the accounting policies applied in the preparation of the
31 March 2016 consolidated annual financial statements except for the change in
accounting policy in respect of bearer biological assets standard which has been
retrospectively applied. The group has adopted all the new or revised accounting
pronouncements as issued by the International Accounting Standards Board.
The results have been prepared by N Naidoo CA (SA) under the supervision of GL
Veale CA (SA), the group financial director.
The financial information has been prepared on the historical cost basis except for the
valuation of biological assets, certain financial instruments and share-based
payments, which are at fair value.
AUDITED RESULTS
These provisional summary consolidated financial statements for the year ended 31
March 2017 have been audited by Deloitte & Touche who expressed an unmodified
opinion thereon. The auditor has expressed an unmodified opinion on the
consolidated annual financial statements from which these provisional summary
consolidated financial statements were derived.
A copy of the auditor's report on the provisional summary consolidated financial
statements and of the auditor's report on the consolidated annual financial
statements are available for inspection at the company's registered office, together
with the financial statements identified in the respective auditor's reports.
The auditor's report does not necessarily report on all the information contained in
the financial results. Shareholders are therefore advised that in order to obtain a full
understanding of the nature of the auditor's engagement they should obtain a copy
of the auditor's report together with the accompanying financial information from
the company's registered office.
CHANGES TO THE BOARD OF DIRECTORS
There were no changes to the board of directors.
NOTICE OF ANNUAL GENERAL MEETING
Notice is hereby given to shareholders as recorded in the company’s securities register on 21
July 2017 that the 104th annual general meeting of shareholders of Crookes Brothers Limited
("Crookes Brothers" or "the company"), in respect of the financial year ended 31 March
2017 will be held at the Durban Country Club, Isaiah Ntshangase Road, Durban, 4001 on
Friday, 28 July 2017, at 11h00 ("the AGM" or "the annual general meeting").
The annual report will be posted to shareholders on or about 30 June 2017.
For and on behalf of the board
John Barton Guy Clarke
Chairman Managing Director
Durban
31 May 2017
Registered office and postal address
170 Flanders Drive, Mount Edgecombe, KwaZulu-Natal, 4300
PO Box 611, Mount Edgecombe, KwaZulu-Natal, 4300
Website
www.cbl.co.za
Transfer secretaries
Computershare Investor Services (Pty) Ltd
PO Box 61051, Marshalltown, 2107
Sponsor
Sasfin Capital
A division of Sasfin Bank Limited
Directors
JR Barton* (Chairman), GS Clarke (Managing), RGF Chance*, TJ Crookes*,
TK Denton*(#), JAF Hewat*, P Mnganga*, MT Rutherford*, RE Stewart*,
G Vaughan-Smith*(#), GL Veale (Financial)
* Non-executive director (#)British
Company secretary
Highway Corporate Services (Pty) Limited
The audited results of the group for the year ended 31 March 2017 together with those of the previous year are
set out below:
Audited year Audited year
end end
SUMMARY CONSOLIDATED
STATEMENT OF COMPREHENSIVE INCOME 31 March 31 March
(R000's) 2017 2016*
Revenue 663 951 542 712
Operating profit 125 154 72 212
Share of profit of joint venture and associate companies 2 105 3 549
Investment income 9 055 3 956
Finance costs (5 453) (8 026)
Profit before tax 130 861 71 691
Income tax expense (34 655) (21 638)
Profit for the year 96 206 50 053
Other comprehensive income/(loss) net of income tax
Items that will not be reclassified subsequently to profit or loss:
Remeasurement of defined benefit surplus (211) (115)
Remeasurement of post-employment medical aid obligation 462 1 773
Items that may be reclassified subsequently to profit or loss:
Net fair value (loss)/gain on available-for-sale financial assets during the year (46) 128
Exchange differences on translating foreign operations 1 551 (28 040)
Other comprehensive income/(loss) for the year, net of income tax 1 756 (26 254)
Total comprehensive income for the year 97 962 23 799
Profit for the year attributable to:
Owners of the company 64 826 48 893
Non-controlling interests 31 380 1 160
96 206 50 053
Total comprehensive income attributable to:
Owners of the company 66 582 22 639
Non-controlling interests 31 380 1 160
97 962 23 799
Earnings per share (cents)
Basic 424.7 366.9
Diluted 424.6 365.5
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
RECONCILIATION OF HEADLINE EARNINGS 31 March 31 March
(R000's) 2017 2016*
Profit for the year attributable to owners of the company 64 826 48 893
Adjusted for:
Gain on disposal of property, plant and equipment (128) (399)
Tax effect of the adjustment 36 280
Headline earnings 64 734 48 774
Headline earnings per share (cents)
Headline earnings per share 424.1 366.0
Headline earnings per share (diluted) 424.0 364.6
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
DIVIDEND DECLARATION 31 March 31 March
2017 2016*
Dividends per share (cents)
Ordinary dividends declared per share - interim 50.0 35.0
Ordinary dividends declared per share - final 115.0 115.0
165.0 150.0
Audited year Audited year
end end
SUMMARY CONSOLIDATED
STATEMENT OF CHANGES IN EQUITY 31 March 31 March
(R000's) 2017 2016*
Shareholders' equity at beginning of year 1 004 117 783 603
Movements in:
Share capital and premium - share issue - 215 000
Share issue costs written off against share premium - (1 738)
Share-based payment reserve 980 398
Other comprehensive income/(loss) for the year 1 294 (28 027)
Changes in retained earnings 60 587 34 881
Net profit attributable to owners of the company 64 826 48 893
Remeasurement of post-employment obligations 462 1 773
Net profit attributable to non-controlling interests 31 380 1 160
Dividends paid - ordinary shareholders (25 186) (15 092)
Dividends paid - community partners (10 895) (1 853)
Shareholders' equity at end of year 1 066 978 1 004 117
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
SUMMARY CONSOLIDATED
STATEMENT OF FINANCIAL POSITION 31 March 31 March
(R000's) 2017 2016*
ASSETS
Non-current assets 944 326 801 209
Property, plant and equipment 874 815 769 941
Other financial assets 1 019 710
Investments in joint venture and associates 55 410 23 612
Deferred tax assets 13 082 6 946
Current assets 523 495 495 433
Inventories 151 191 111 601
Biological assets 213 272 189 522
Trade and other receivables 84 512 53 963
Current tax assets 6 900 4 356
Retirement benefit surplus 10 212 9 708
Unsecured loans 540 540
Cash and bank balances 56 868 125 743
Total assets 1 467 821 1 296 642
EQUITY AND LIABILITIES
Capital and reserves 1 066 978 1 004 117
Share capital and premium 226 271 226 271
Investment revaluation reserve 951 997
Foreign currency translation reserve (23 764) (25 315)
Share-based payment reserve 2 414 1 434
Retained earnings 836 706 796 815
Equity attributable to owners of the company 1 042 578 1 000 202
Non-controlling interests 24 400 3 915
Non-current liabilities 218 918 209 485
Deferred tax liabilities 148 326 132 559
Long term borrowings: interest-bearing 33 169 42 967
Long term liability: interest-free 37 423 33 959
Current liabilities 181 925 83 040
Trade and other payables 51 182 32 337
Short term borrowings: interest-bearing 80 356 24 629
Provisions 16 810 14 104
Outside shareholders' loan 597 660
Current tax liabilities 14 074 2 307
Dividend withholding tax - 63
Post-employment medical aid obligation 9 023 8 940
Bank overdraft 9 883 -
Total equity and liabilities 1 467 821 1 296 642
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
SUMMARY CONSOLIDATED
STATEMENT OF CASH FLOWS 31 March 31 March
(R000's) 2017 2016*
Operating profit for the year 125 154 72 212
Adjustment for non-cash items 28 169 55 135
153 323 127 347
Net working capital changes (51 505) (30 778)
Cash generated from operations 101 818 96 569
Cash flows from operating activities 89 361 83 666
Cash generated from operations 101 818 96 569
Interest received 8 958 3 847
Interest paid (5 453) (8 026)
Income taxes paid (15 962) (8 358)
Purchase of annuities for post-employment medical aid benefits - (366)
Cash flows from investing activities (189 266) (104 216)
Proceeds on disposal of property, plant, equipment 1 743 665
Proceeds on disposal and redemption of investments - 100
Investment in property, plant and equipment:
replacement (9 065) (12 528)
expansion and development (102 783) (33 777)
bearer asset replants (47 151) (57 976)
Investment in joint venture and associate companies (31 798) (727)
Other net investing activities (212) 27
Cash flows from financing activities 21 147 133 220
Dividends paid:
Ordinary shareholders (25 186) (15 092)
Community partners (10 895) (1 853)
Proceeds from issue of equity instruments of the company - 215 000
Payment for share issue costs - (1 738)
Net increase/(decrease) in borrowings 57 228 (63 097)
Net (decrease)/increase in cash and cash equivalents (78 758) 112 670
Cash and cash equivalents at beginning of year 125 743 13 073
Cash and cash equivalents at end of year 46 985 125 743
Cash flow from operating activities - per share (cents) 585.4 627.9
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
OTHER GROUP SALIENT FEATURES 31 March 31 March
(R000's) 2017 2016*
Depreciation 48 557 45 691
Capital commitments
- Contracted and anticipated:
- replacement 1 231 1 100
- expansion and development 25 736 8 780
26 967 9 880
- Authorised but not contracted:
- replacement 11 538 5 295
- expansion and development 177 882 200 056
- bearer asset replants 36 825 16 000
226 245 221 351
Guarantees 86 86
Net asset value per share (cents) 6 990 6 578
Number of shares in issue 15 264 317 15 264 317
Weighted average number of shares on which earnings per share (and headline
earnings per share) are based 15 264 317 13 325 792
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under
IAS 16: property, plant and equipment.
Audited year Audited year
end end
SUMMARY CONSOLIDATED
SEGMENTAL ANALYSIS 31 March 31 March
(R000's) 2017 2016*
Revenue*
Sugar cane 342 844 283 321
Deciduous fruit 170 219 134 012
Bananas 126 493 104 962
Other operations 24 395 20 417
663 951 542 712
Operating profit*
Sugar cane 136 979 49 108
Deciduous fruit (10 386) 46 719
Bananas 38 076 23 718
Macadamias(1) 2 317 (13 782)
Property development^ (1 530) (64)
Other operations^ 9 261 6 355
Unallocated profit on disposal of property, plant and equipment 128 399
Unallocated corporate expenses(1) (49 691) (40 241)
125 154 72 212
Assets*
Sugar cane 457 712 409 284
Deciduous fruit 381 206 390 098
Bananas 31 178 27 043
Macadamias 214 816 172 074
Property development^ 93 580 13 588
Other operations^ 29 292 25 744
Unallocated investments and loans 56 969 24 862
Unallocated corporate assets 203 068 233 949
1 467 821 1 296 642
Liabilities*
Sugar cane 83 455 53 642
Deciduous fruit 11 945 11 598
Bananas 13 691 6 673
Macadamias 27 439 30 301
Unallocated corporate liabilities 264 313 190 311
400 843 292 525
* Prior year restated to account for change in accounting policy, with respect to bearer assets now measured under IAS 16:
property, plant and equipment.
^ Prior year reclassified to disaggregate the "Property development" segment, previously included under "Other Operations".
(1)Prior year reclassified to reallocate operating lease rentals and unrealised foreign exchange differences to the
relevant crop segment.
The "Macadamias" segment represents mainly interest and gains and losses arising from the translation of the US Dollar
term loan to Rands.
Audited year Audited year
end end
NOTES TO THE SUMMARY FINANCIAL STATEMENTS 31 March 31 March
(R000's) 2017 2016*
1. BIOLOGICAL ASSETS
1.1 Growing crops and livestock
At fair value
Sugar cane 176 078 151 253
Deciduous fruit 20 044 25 347
Bananas 16 229 11 995
Livestock 921 927
Fair value at end of year 213 272 189 522
Reconciliation of fair values of growing crops and livestock:
Fair value at beginning of year - as previously reported 189 522 439 098
Effect of change in accounting policy on opening balances - (254 234)
Fair value at beginning of year - restated 189 522 184 864
Gains arising from changes attributable to physical and price changes:
- Sugar cane 175 609 165 093
- Deciduous fruit 20 044 43 366
- Bananas 16 230 15 478
- Macadamias 43 159
Decreases due to harvest and sales:
- Sugar cane (151 536) (165 070)
- Deciduous fruit (25 348) (13 251)
- Bananas (11 995) (8 345)
- Macadamias - ( 101)
Fair value changes attributable to births, deaths and ageing of livestock (6) (18)
Effect of foreign currency exchange differences 752 (13 692)
Transfer of grain to inventory - (6 543)
Effect of change in accounting policy on movement for the year - (55 418)
Fair value at end of year 213 272 189 522
In terms of IAS 41 Agriculture, standing sugar cane and growing crops
(bananas, deciduous fruit, grain and macadamia nuts) are accounted for as biological
assets and are measured and recognised at fair value. Changes in fair value,
replanting and agricultural operating costs incurred are included in profit or loss.
Bearer assets are now accounted for as property, plant and equipment and
recognised at depreciated historic cost.
Non-financial measurements that affect the group's biological asset valuation
include weather and climate, in the form of rainfall, heat and evaporation.
Stability of electricity supply, water rights and water restrictions impact on the
group's ability to irrigate its standing crops. In South Africa,
the use of farmland for commercial farming purposes is regulated by the
Department of Agriculture.
The fair value of crops and agricultural produce is determined based on current
market prices less estimated selling costs.
* Prior year restated to account for change in accounting policy, with respect to bearer assets
now measured under IAS 16: property, plant and equipment.
Audited year Audited year
end end
31 March 31 March
2017 2016*
1.2 Biological asset valuations
The following key assumptions have been used in determining the
fair value of biological assets:
SUGAR CANE
Standing sugar cane
Expected area to harvest - after 31 March
- South Africa (ha) 3 615 4 008
- Swaziland (ha) 2 195 2 288
- Zambia (ha) 382 415
Estimated yields
- South Africa (tons/ha) 84.8 77.2
- Swaziland (tons/ha) 108.0 86.2
- Zambia (tons/ha) 130.0 111.0
Average maturity of cane at 31 March
- South Africa (%) 64 64
- Swaziland (%) 64 64
- Zambia (%) 64 64
Estimated RV price - South Africa (Rands) 4 790 4 446
Estimated sucrose price - Swaziland (Rands) 3 880 3 416
Estimated ERC price - Zambia (Rands) 3 355 3 808
DECIDUOUS FRUIT
Crop
Expected area to harvest - after 31 March (ha) 178 183
Estimated yields (tons/ha) 57.0 54.4
Average maturity of crop at 31 March (%) 81.8 84.2
Estimated net price per kg - apples and pears (Rands) 3.97 3.85
Estimated packout
- Class 1 (%) 41.6 40.8
- Class 2 (%) 15.9 16.6
- Class 3 (%) 9.1 10.7
- Juice (%) 33.4 31.9
BANANAS
Crop
Expected area to harvest - after 31 March (ha) 411 354
Estimated yields (tons/ha) 52.6 55.2
Average maturity of crop at 31 March (%) 50.0 50.0
Estimated net price per carton (Rands) 134.64 103.73
MACADAMIAS(1)
Crop
Expected area to harvest - after 31 March (ha) - -
* Prior year restated to account for change in accounting policy, with respect to bearer assets
now measured under IAS 16: property, plant and equipment.
(1)A macadamia tree is expected to reach full production at an age of seven years.
Trees under crop are presently four to five years old with limited production in year six.
2. FAIR VALUE MEASUREMENT
The directors are of the opinion that the book value of financial assets and liabilities does not exceed their approximate
fair value.
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at
fair value, grouped into levels 1 to 3 based on the degree to which the fair value is observable.
- Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical
assets or liabilities.
- Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1
that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived prices).
- Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or
liability that are not based on observable market data (i.e. unobservable inputs).
2017 Level 1 Level 2 Level 3 Total
Other financial assets - 586 - 586
Biological assets (excluding livestock) - - 212 351 212 351
Inventories - agricultural produce - - 56 221 56 221
- 586 268 572 269 158
2016*
Other financial assets - 514 - 514
Biological assets (excluding livestock) - - 188 595 188 595
Inventories - agricultural produce - - 66 565 66 565
- 514 255 160 255 674
The group's financial assets and financial liabilities are measured at fair value on a recurring basis.
There have been no transfers between level 1 and 2 of any financial assets in the current financial
reporting period.
The following table gives information about how the fair values of these financial assets and financial
liabilities are determined (in particular, the valuation technique(s) and inputs used).
Fair value as Fair value as Fair value hierarchy Valuation technique(s)
Financial assets/financial liabilities at 2017 at 2016* and key input(s)
Quoted bid prices in an
Other financial assets 586 514 Level 2 active market.
Discounted cash flow.
Current estimated
market prices for the
following season, less
the estimated costs of
Biological assets (excluding livestock) 212 351 188 595 Level 3 harvesting, transport,
packing and point-of-
sale costs.
Discounted cash flow.
Current estimated
market prices for the
following season, less
Inventories - agricultural produce 56 221 66 565 Level 3 the estimated costs of
harvesting, transport,
packing and point-of-
sale costs.
Significant
Fair value as Fair value as Fair value hierarchy unobservable inputs to
Financial assets/financial liabilities at 2017 at 2016* fair value
Other financial assets 586 514 Level 2 None.
Estimated price, yield
and inflation is subject to
fluctuation and change.
Prices are not based on
Biological assets (excluding livestock) 212 351 188 595 Level 3 published or quoted
market and commodity
listings.
Estimated price and
packout is subject to
fluctuation and change.
Prices are not based on
Inventories - agricultural produce 56 221 66 565 Level 3 published or quoted
market and commodity
listings.
Relationship of
Fair value as Fair value as Fair value hierarchy unobservable inputs to
Financial assets/financial liabilities at 2017 at 2016* fair value
Other financial assets 586 514 Level 2 None.
In arriving at the fair
value, the estimated
price is applied against
the expected area to
harvest, together with
Biological assets (excluding livestock) 212 351 188 595 Level 3 the estimated yields and
average maturity of the
crop.
In arriving at the fair
value at the date of
harvesting, the
estimated price is
applied against the
Inventories - agricultural produce 56 221 66 565 Level 3 estimated point of sale
costs incurred, in
bringing the produce to
their present location
and condition to be sold
The group's growing crops and agricultural produce are measured at fair value which is determined using
estimated unobservable inputs and is categorised as level 3 under the fair value hierarchy. The unobservable
inputs are disclosed in the above fair value hierarchy.
The fair value of standing crops and agricultural produce is determined by their growth factor, estimated
yield, quality, age and selling prices less costs to harvest, transport and sell.
Changes in the fair value of biological assets are included in profit or loss, with an increase of R23 million
(2016: restated increase of R55 million) being recognised in profit or loss in the current year.
A reconciliation of the change in fair value for the year is included in note 1.1.
Sensitivity analysis 2017 2016*
The impact of a 1% change in the price or yield of biological assets (excluding livestock)
will have the following effect on pre-tax profit or loss:
Sugar cane 2 073 1 809
Deciduous fruit 291 287
Bananas 287 246
Grain - 78
2 651 2 420
The impact of a 1% change in the price of agricultural produce
will have the following effect on pre-tax profit or loss:
Deciduous picked produce - stock 581 647
The impact of a 1% change in the packout of biological assets from
Class 1 to juice will have the following effect on pre-tax profit or loss:
Deciduous fruit 350 438
The impact of a 1% change in the packout of agricultural produce from
Class 1 to Class 3 will have the following effect on pre-tax profit or loss:
Deciduous fruit 452 590
The impact of a 1% change in the price of a carton of bananas has a negligible effect on pre-tax profit or loss.
* Prior year restated to account for change in accounting policy, with respect to
bearer assets now measured under IAS 16: property, plant and equipment.
Date: 31/05/2017 09:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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