ASSORE LIMITED - Provisional reviewed results for the year ended 30 June 2018

Release Date: 06/09/2018 07:30
Code(s): ASR
 
Wrap Text
Provisional reviewed results for the year ended 30 June 2018

Assore Limited 
Company registration number: 1950/037394/06
Share code: ASR 
ISIN: ZAE000146932 
(Assore or group or company)
Provisional reviewed results for the year ended 30 June 2018


HIGHLIGHTS

- Safety: overall improvement in LTIFR
- Record iron and chrome ore sales and production for the fourth consecutive year
- Record attributable earnings for the second consecutive year
- Record annual dividend of R22,00 per share

CEO Charles Walters said:
“The group achieved record sales and production volumes of iron and chrome ore for the fourth consecutive year.
The Chinese authorities’ enforcement of more stringent environmental controls had a positive impact on the 
demand for the group’s higher quality products. The Black Rock mine achieved record manganese ore production 
while Sakura Ferroalloys in Malaysia reached full capacity of ferromanganese production in the year.”

COMMENTARY

Safety 
Assore operations
Dwarsrivier Chrome Mine Proprietary Limited (Dwarsrivier) showed a slight improvement in its lost time injury 
frequency rate (LTIFR) from 0,20 for the financial year ended 30 June 2017 (FY17) to 0,19 for the financial 
year ended 30 June 2018 (FY18). The impact on Assore’s LTIFR of its other operations resulted in an overall 
increase from 0,25 to 0,27 over the same period.

Assmang operations
The operations of Assmang Proprietary Limited (Assmang), which is jointly controlled by Assore and 
African Rainbow Minerals Limited (ARM), achieved a combined LTIFR of 0,13 for FY18. This was an overall improvement
compared to 0,17 for FY17. Its smelting operations at Cato Ridge and Machadodorp completed FY18 without recording 
a lost time injury.

We are, however, saddened to report the tragic loss of a colleague due to a work-related incident that occurred on 
30 March 2018 at Sakura Ferroalloys SDN BHD, Malaysia, (Sakura) in which Assmang has a 54,36% interest. We share our
deepest condolences with the family and friends of our colleague, and deeply regret this loss.

The group remains committed to the pursuit of continuing sustainable improvement in our overall safety performance. 

Group financial performance
Headline earnings for FY18 are at a similar level compared to those recorded in FY17, decreasing by 2% to R5,1 billion, 
from R5,2 billion for FY17. Assmang’s headline earnings which were 5% lower than in FY17, at R7,1 billion contributed 
R3,5 billion (50%) towards Assore’s earnings. In accordance with International Financial Reporting Standards (IFRS), 
Assmang, in which Assore has a 50% interest, is classified as a joint venture and accordingly, its financial results 
are equity-accounted. The rest of the group’s operations reported headline earnings that were 4% higher than FY17, at 
R1,6 billion, Dwarsrivier contributed R875 million (FY17: R843 million) of this, with commissions and interest earned making
up most of the balance. Attributable earnings amounted to R5,1 billion, 2% higher than FY17, representing another annual
record. 

The average SA rand/US dollar exchange rate for FY18 was R12,82, 6% stronger than the level that prevailed during
FY17. This had the effect of countering the somewhat higher commodity prices for FY18. Record sales and production volumes
of iron and chrome ore were once again achieved, making this the fourth consecutive financial year in which record sales
volumes of these products were achieved. The Black Rock complex achieved record manganese ore production in FY18. 


Production and sales volumes achieved by the group were as follows:
                                                                                  %
Metric tons ’000                       FY18                   FY17         increase
Production volumes                                                                 
Iron ore                             18 578                 17 714                5
Manganese ore                         3 717                  3 069               21
Manganese alloys                        462                    403               15
Chrome ore                            1 619                  1 392               16
Sales volumes                                                                      
Iron ore                             17 874                 17 275                3
Manganese ore*                        3 177                  2 974                7
Manganese alloys                        378                    303               25
Chrome ore                            1 557                  1 279               22
*Excluding intra-group sales to Cato Ridge Works.                                     


Strong cash generation in the group resulted in group net cash increasing by 56% to R7,9 billion (FY17: R5,0 billion).
A final dividend of R12,00 per share has been declared, bringing the total dividend for FY18 to a record level of 
R22,00 (FY17: R14,00) per share.

Market conditions 
The markets into which the group sells its products were generally stronger in comparison to FY17. World crude steel
production grew by 5% in the 2017 calendar year (CY17) and this growth rate was maintained during the first six months 
of the 2018 calendar year (CY18). Healthy demand for ores resulted in stable prices for iron ore and an increase in prices
for manganese ore. Higher demand for ferrochrome was driven by increased production of stainless steel (up 6% in CY17
over the 2016 calendar year), resulting in strong demand for chrome ore, prices of which were steady over FY18. The
tightening of environmental controls in China continues to drive positive demand for higher grade raw materials, as 
evidenced by higher premiums achieved for “lumpy” grades of iron ore. 

Assmang (iron ore and manganese)
Attributable earnings increased by 8% over FY17 to R7,1 billion (100%). Iron ore delivered R3,3 billion (down 25% on
FY17), while manganese ore and alloys increased by 71% to R3,8 billion. This was driven mostly by increased sales
revenue, which was 5% up on FY17 to R27,5 billion on the back of the increased volumes, as well as steady higher product
prices.

Capital expenditure in Assmang amounted to R3,1 billion for FY18 (FY17: R2,8 billion). The Iron Ore division spent
R1,8 billion, an increase of 52% on FY17, relating to waste stripping and additional mining fleet machinery requirements.
Black Rock’s capital expenditure decreased by 19% to R1,3 billion (FY17: R1,6 billion) mainly due to lower capital
expenditure incurred for the Black Rock Project, as most of the surface infrastructure improvements were completed and
commissioned in FY17. At the end of FY18, approximately 90% of the approved R6,7 billion capital expenditure on the Black 
Rock Expansion Project was committed or spent. 

Capital spend of approximately R2,7 billion (on a 100% basis) over the next few years has been approved for the
modernisation and optimisation of the Gloria Mine at Black Rock. This mostly sustaining capex will increase Black Rock’s
flexibility to produce the differentiated medium to high-grade products that the manganese market is increasingly demanding,
and paying premiums for, and will result in overall production capacity at Black Rock of approximately five million tons
per annum. Gloria is expected to be shut for six months of the 2019 financial year as part of this modernisation, but
sales will be met from inventory which has been built up in anticipation of the shutdown. 

Iron ore
The average market price for iron ore was stable over FY18, compared to FY17, at US dollar 69 per ton (62% iron
content, “fines” grade, delivered in China) and the “lumpy” premium almost doubled over the same period, to US dollar 13,34
per ton. In addition, Khumani Iron Ore Mine achieved record production of 14,7 million tons and total sales volumes were
marginally up on FY17 by 3%, to 17,9 million (FY17: 17,3 million) tons. These factors were, however, not sufficient to
counter the effect of the stronger rand/US dollar exchange rate.

Manganese ore and alloys
The demand for manganese ore remained strong, driven by weaker than expected Chinese domestic manganese ore production
and significantly higher Chinese electrolytic manganese metal (EMM) production. The strong demand and undersupplied
Chinese market resulted in an improvement in manganese ore prices, with the average index price for 44% grade manganese
content material, delivered in China increasing by 19% to US dollar 6,88 per dry metric ton unit (dmtu), from US dollar
5,77 in FY17. 

The alloy market remained undersupplied as growth in supply was not sufficient to cover the increases in demand. These
conditions, together with robust manganese ore prices, strong steel consumption and high steel prices resulted in alloy
prices across the grades being maintained at the higher levels seen since the start of CY17.

The positive price momentum and increased production of both manganese ore and alloys (including from Sakura, which
achieved nameplate production during FY18), resulted in increased earnings from the Manganese division.

Dwarsrivier (chrome ore)
A combination of improved mining and beneficiation efficiencies, coupled with increased asset utilisation, gave rise
to a 16% increase in production compared to FY17, with the mine achieving records in five months during FY18. This
production, together with favourable market conditions, enabled the mine to achieve another year of record sales volumes 
of 1,6 million tons (FY17: 1,3 million tons). While the price for chrome ore was less volatile in FY18 compared to FY17, the
average index market price was down by 28%, year-on-year, with an average price for the year of US dollar 224 per ton
(44% chrome content material, delivered China), compared to US dollar 310 in FY17. The strong production and sales
performance, however, resulted in the impact of the lower prices and stronger rand/US dollar exchange rate being mostly
negated, with the mine generating more than R1 billion of cash, after accounting for capital expenditure of R300 million.

Marketing and shipping
Marketing commissions earned by the group increased by 6% over FY17, in line with the increase of 5% in Assmang’s
turnover. Interest earned on the group’s cash resources amounted to R502 million.

Other 
The group holds a 28,9% interest in IronRidge Resources Limited (IronRidge), an Australian minerals exploration
company listed on London’s Alternative Investment Market (AIM). IronRidge has a portfolio of gold, lithium, bauxite, titanium
and iron ore prospects in Africa and Australia. During FY18, the activities of IronRidge were focused mainly on lithium
and gold exploration prospecting in Ghana, Chad and Ivory Coast. 

Outlook
As this period of global economic cyclical upswing approaches two years, the pace of expansion in some economies
appears to have peaked, with decelerated growth projected in the near future. Recent increases in trade tariffs have not
impacted the group negatively to date. However, further escalation of tensions and a potential trade war could impact global
economic growth and demand for steel negatively.

The Chinese economy remains robust with the growth recorded in the first half of the 2018 calendar year well above the
target GDP level of 6,5%. Efforts by Chinese authorities to enforce more stringent environmental controls had a
positive impact on the demand for the group’s higher quality products. This trend is set to continue and should support 
prices for the group’s products in the near term. 
 
Following the release of the draft Mining Charter 2018 in June, the mining industry in South Africa continues to face
a high level of uncertainty and the impact of the changes are likely to be negative for the country’s mining industry.
Further to the factors noted above, the results of the group remain significantly exposed to fluctuations in exchange
rates.

Accounting policies and basis of preparation
The board of directors of Assore (the board) takes full responsibility for the preparation of this announcement and
for the correctness of the financial information extracted from the underlying financial statements. The financial results
for the year under review have been prepared under the supervision of Mr RA Davies, CA(SA) and in accordance with IAS
34 - Interim Financial Reporting and comply with IFRS, the SAICA Financial Reporting Guides as issued by the Accounting
Practices Committee, the Financial Pronouncements as issued by Financial Reporting Standards Council, the Listings
Requirements of the JSE Limited (JSE) and the Companies Act No 71 of 2008, as amended. The accounting policies applied are
consistent with those adopted in the financial year ended 30 June 2017.

Ernst & Young Inc, the group’s independent external auditors, have reviewed the condensed consolidated provisional
results included in this announcement and their unmodified review report is available for inspection at the registered
office of the company. The review was conducted in terms of ISRE 2410 - Review of Interim Financial Information Performed 
by the Independent Auditor of the Entity.

The auditor’s report does not necessarily report on all of the information contained in this announcement.
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.

New accounting standards
The following accounting standards, as published by the International Accounting Standards Board (IASB) have become
effective for the group with effect from 1 July 2018: 
IFRS 15 - Revenue from contracts with customers (IFRS 15)
IFRS 15 was issued in May 2014, and amended in April 2016, and will supersede all current revenue recognition
requirements under IFRS. The core principle of IFRS 15 is that an entity shall recognise revenue to fairly reflect the 
transfer of contracted goods or services for delivery or performance respectively to customers, measured at the amount of
consideration the entity expects to be entitled to in exchange for those goods or services.

The group’s revenue is primarily derived from the sale of commodity products. The timing of the revenue recognition is
dependent on the sales contract terms as documented in the International Commercial terms (incoterms). In terms of IFRS
15, there will be no change in the revenue recognised for free on board (FOB) and deliver at place (DAP) shipments. The
shipping service for all export sales shipped using the cost, insurance and freight (CIF) and cost and freight (CFR)
incoterms, represents a separate performance obligation, i.e. the sale and shipment of goods represent two performance
obligations. The primary performance obligation is the supply of the commodity, in which instance the revenue will be
recognised once the buyer takes control of the goods. The other performance obligation is the delivery of the shipping
service where the revenue earned will be recognised over the period that the service is rendered. The application of 
IFRS 15 will not result in changes to the revenue recognised arising from commission income.

A diagnostic impact assessment has been completed to identify the differences between IFRS 15 and the requirements of
IAS18 - Revenue Recognition (the current applicable accounting standard). The impact of IFRS 15 on both the statement of
financial position and the income statement has been assessed. Following this assessment, the group will be making
additional disclosure in the notes to its financial statements, setting out the respective components of revenue as
reported. The group has elected to adopt a full retrospective approach to the adoption of this standard, however, it has 
been determined that the impact on the reported gross profit of previous years is negligible and will therefore not require
adjustment.

IFRS 9 - Financial Instruments (IFRS 9)
IFRS 9 has replaced IAS 39 - Financial Instruments: Recognition and Measurement and applies to the classification and
measurement of financial assets and financial liabilities, their impairment and hedge accounting. The group plans to
adopt the new standard on 1 July 2018 which is the group’s effective date of adoption and will not restate comparative
information. The classification and measurement of financial assets and liabilities adopted by the group will remain mostly
unchanged, except for available-for-sale investments, which will be classified as financial assets measured at fair
value through other comprehensive income. The impact of this is that all fair value gains and losses will not be recognised
in the income statement but will remain in other comprehensive income. This represents a change from the previous
treatment of gains and losses recorded on remeasurement of these investments, which required impairment losses as well as
gains and losses on disposal to be recognised in the income statement.

The impact of the expected credit losses on financial assets classified at amortised cost in the group was considered
but is expected to be negligible. 

Correction to interim results for the period ended 31 December 2016 (H1 FY17 results)
Following the JSE’s proactive monitoring process of financial statements, shareholders are advised that, as reported
on SENS on 22 February 2017, the headline earnings and headline earnings per share (HEPS) for the period ended 
31 December 2016 were incorrectly determined, in that an impairment charge of R373 million recorded by Assmang upon its sale 
of Dwarsrivier to the group, effective 1 July 2016 was not excluded in the determination of headline earnings. This
impairment was equity accounted as part of the group’s earnings for the period ending 31 December 2016 but not excluded from 
the group’s HEPS. At 30 June 2017, Assore’s determination of Dwarsrivier’s fair value for the purposes of the purchase price
allocation (within the 12-month timeframe allowed in accordance with IFRS 3 - Business Combinations) resulted in a
final gain on bargain purchase of R257 million being recorded in the group’s financial statements for the year ended 
30 June 2017. The HEPS calculation for the year ended 30 June 2017 correctly excluded the impairment charge and the gain on
bargain purchase. 

The corrections to the reported headline earnings and HEPS for the interim period ended 31 December 2016 are therefore 
as follows:                                                                    
                                                 As reported      Adjustment         Corrected      % increase    
Headline earnings (R’000)                          2 172 082         373 014         2 545 096            17.2          
HEPS (cents)                                           2 105             362             2 467            17.2          

In summary, Assore draws shareholders’ attention to the fact that the Dwarsrivier transaction was concluded over
multiple reporting periods. For full information on the transaction, shareholders are referred to the annual financial
statements of Assore for the year ended 30 June 2017. At the interim date 31 December 2016, the headline earnings calculation
(corrected above) would only have included the impairment recognised by Assmang and not the gain on bargain purchase.
Subsequently at 30 June 2017, the transaction in its entirety was reflected in HEPS, i.e. the impairment recognised by
Assmang and the gain on bargain purchase option as recognised by Assore.

Declaration of final dividend
Shareholders are advised that on 5 September 2018, the board approved final dividend number 123 (the dividend), of 
1 200 cents per share (gross) for the year ended 30 June 2018. 

In terms of paragraph 11.17 of the Listings Requirements of JSE Limited, shareholders are advised of the following
with regard to the declaration:
1. The dividend has been declared from retained earnings
2. The local dividend tax (dividend tax) rate of 20% will apply
3. The net local dividend amount is 960 cents per share for shareholders liable to pay the dividend tax
4. The issued ordinary share capital of Assore is 139 607 000 shares, of which 36 445 970 (FY17: 36 447 746) shares
   are accounted for as treasury shares in terms of IFRS and are therefore excluded from earnings per share calculations
5. Assore’s income tax reference number is 9045/018/84/4.

The salient dates are as follows:
Last day for trading to qualify and participate in the final dividend                         Tuesday, 25 September 2018
Trading “ex dividend” commences                                                             Wednesday, 26 September 2018
Record date                                                                                    Friday, 28 September 2018
Dividend payment date                                                                             Monday, 1 October 2018
Dates (inclusive) between which share certificates                                          Wednesday, 26 September 2018
may not be dematerialised or rematerialised                                                 to Friday, 28 September 2018


On behalf of the board

Desmond Sacco            Charles Walters
Chairman                 Chief Executive Officer

6 September 2018


CONDENSED CONSOLIDATED INCOME STATEMENT FOR THE YEAR ENDED 30 JUNE 2018

R’000                                                                                    30 June 2018      30 June 2017 
                                                                                             Reviewed           Audited 
Revenue                                                                                     7 804 737         7 223 959 
Turnover                                                                                    6 305 587         5 945 266 
Cost of sales                                                                              (4 800 780)       (4 200 692)
Gross profit                                                                                1 504 807         1 744 574 
Commissions on sales and technical fees                                                       979 005           920 055 
Other income                                                                                  648 564           372 317 
Bargain purchase gain                                                                               -           256 755 
Impairment of financial and non-financial assets                                              (31 083)                - 
Foreign exchange losses                                                                        (6 896)             (401)
Other expenses                                                                               (762 531)         (801 361)
Finance costs                                                                                 (19 394)          (19 662)
Profit before taxation and joint venture                                                    2 312 472         2 472 277 
Taxation                                                                                     (645 546)         (583 420)
Profit after taxation, before joint venture                                                 1 666 926         1 888 857 
Share of profit from joint venture, after taxation                                          3 524 287         3 266 282 
Share of loss from associates, after taxation                                                 (16 211)          (16 809)
Profit for the year                                                                         5 175 002         5 138 330 
Attributable to:                                                                                                        
Shareholders of the holding company                                                         5 119 329         5 021 171 
Non-controlling shareholders                                                                   55 673           117 159 
As above                                                                                    5 175 002         5 138 330 
Earnings as above                                                                           5 119 329         5 021 171 
Impairment of financial and non-financial assets in joint venture and subsidiaries             48 929            96 501 
Impairment arising on the sale of Dwarsrivier in joint venture                                      -           373 014 
Bargain purchase gain (Dwarsrivier)                                                                 -          (256 755)
(Profit)/loss on disposal of property, plant and equipment                                     (4 348)            1 670 
Profit on sale of available-for-sale listed investments                                       (42 432)                - 
Taxation effect of above items                                                                (12 726)          (26 555)
Headline earnings                                                                           5 108 752         5 209 046 
Earnings per share (basic and diluted - cents)                                                  4 963             4 867 
Headline earnings per share (basic and diluted - cents)                                         4 953             5 049 
Dividends per share declared in respect of the profit for the year (cents)                      2 200             1 400 
- Interim                                                                                       1 000               600 
- Final                                                                                         1 200               800 
Weighted average number of ordinary shares (million)                                                                    
Ordinary shares in issue                                                                       139,61            139,61 
Weighted impact of treasury shares held in trust                                               (36,46)           (36,43)
                                                                                               103,15            103,18 

  
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2018

                                                                                         30 June 2018      30 June 2017 
R’000                                                                                        Reviewed           Audited 
Profit for the year (as above)                                                              5 175 002         5 138 330 
Items that may be reclassified into the income statement dependent on the 
outcome of a future event                                                                     162 862          (210 563)
Gain on revaluation to market value of available-for-sale investments after taxation           32 933            38 251 
Gain on revaluation to market value of available-for-sale investments                          77 024            49 292 
Deferred capital gains tax thereon                                                            (44 091)          (11 041)
Exchange differences on translation of foreign operations                                     129 929          (248 814)
Items that may not be reclassified into the income statement dependent on 
the outcome of a future event                                                       
Actuarial gain on pension fund, after taxation                                                 17 206            26 959 
Total comprehensive income for the year, net of tax                                         5 355 070         4 954 726 
Comprehensive income attributable to non-controlling shareholders                             (57 709)         (104 364)
Attributable to shareholders of the holding company                                         5 297 361         4 850 362


CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION AT 30 JUNE 2018

                                                                                         30 June 2018      30 June 2017 
R’000                                                                                        Reviewed           Audited 
ASSETS                                                                                                                  
Non-current assets                                                                                                      
Property, plant and equipment and intangible assets                                         1 793 865         1 584 642 
Investments                                                                                                             
- joint venture                                                                            15 984 321        15 327 400 
- available-for-sale                                                                          262 003           229 376 
- associate                                                                                   154 896           108 729 
- other                                                                                         7 568            24 098 
Long-term loan                                                                                  6 000                 - 
Pension fund surplus                                                                          129 245            93 144 
Total non-current assets                                                                   18 337 898        17 367 389 
Current assets                                                                                                          
Inventories                                                                                 1 361 954         1 223 032 
Trade and other receivables                                                                 1 222 327         1 104 332 
Cash resources                                                                              8 449 797         5 626 778 
Assets held-for-sale as part of identified disposal groups                                      1 351                 - 
Total current assets                                                                       11 035 429         7 954 142 
TOTAL ASSETS                                                                               29 373 327        25 321 531 
EQUITY AND LIABILITIES                                                                                                  
Share capital and reserves                                                                                              
Ordinary shareholders' interest                                                            26 091 352        22 649 300 
Non-controlling shareholders’ deficit                                                         (40 990)          (24 348)
Total equity                                                                               26 050 362        22 624 952 
Non-current liabilities                                                                                                 
Net deferred taxation liabilities                                                             345 440           283 778 
Non-interest-bearing long-term liabilities                                                    184 152           134 920 
Total non-current liabilities                                                                 529 592           418 698 
Current liabilities                                                                                                     
Interest-bearing                                                                              584 472           579 719 
Non-interest-bearing                                                                        2 191 727         1 698 162 
Liabilities associated with assets held-for-sale                                               17 174                 - 
Total current liabilities                                                                   2 793 373         2 277 881 
TOTAL EQUITY AND LIABILITIES                                                               29 373 327        25 321 531 


FAIR VALUES OF FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2018

The group uses the following hierarchy for determining and disclosing the fair value inputs of financial 
instruments:                                               
Level 1 - quoted prices in an active market that are unadjusted for identical assets or liabilities; 
Level 2 - valuation techniques using inputs, which are directly or indirectly observable; and        
Level 3 - valuations based on data that is not observable (not applicable to the group).             
The values of all other financial instruments recognised, but not subsequently measured at fair value, 
approximate fair value.  

                                                                                         30 June 2018      30 June 2017
                                                                                             Reviewed           Audited
R’000                                                                                         Level 1           Level 1
Assets measured at fair value                                                                                          
Available-for-sale investments                                                                262 003           229 376
Other investments                                                                               7 568            24 098
                                                                                              269 571           253 474


CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW FOR THE YEAR ENDED 30 JUNE 2018

                                                                                         30 June 2018       30 June 2017*
R’000                                                                                        Reviewed            Audited 
Cash generated from operations                                                                185 515            734 600 
Net cash generated from operations                                                          2 342 134          2 205 469 
Net finance costs and taxation flows                                                         (225 550)          (240 751)
Net dividend flows                                                                         (1 931 069)        (1 230 118)
Cash retained from investing activities                                                     2 632 751          2 123 308 
Dividends received from joint venture entity                                                3 000 000          2 250 000 
Net capital expenditure                                                                      (367 249)          (126 692)
Cash utilised by financing activities                                                           4 753           (416 055)
Increase in cash for the year                                                               2 823 019          2 441 853 
Cash resources at beginning of year                                                         5 626 778          3 184 925 
Cash resources per statement of financial position                                          8 449 797          5 626 778 
* The net cash generated from operations, net finance costs and taxation flows, net dividend flows, dividends received from 
  joint venture entity and net capital expenditure lines were included in these results with FY17 being restated accordingly 
  to clarify the movements in cash generated from operations and cash retained from investing activities.


CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2018

                                                                                         30 June 2018       30 June 2017 
R’000                                                                                        Reviewed            Audited 
Share capital, share premium and other reserves                                                                          
Balance at beginning of year                                                                  341 223            512 032 
Other comprehensive income for the year                                                       182 104           (170 809)
Net increase in the market value of available-for-sale investments                             32 933             38 251 
Actuarial gains on pension plan after taxation                                                 17 206             26 959 
Foreign currency translation reserve arising on consolidation                                 131 965           (236 019)                                                                                                                         
Balance at end of year                                                                        523 327            341 223 
Treasury shares                                                                                                          
Balance at beginning of year                                                               (5 062 848)        (5 051 583)
Acquired during the year                                                                       (2 662)           (11 265)
Balance at end of year                                                                     (5 065 510)        (5 062 848)
Retained earnings                                                                                                        
Balance at beginning of year                                                               27 370 925         23 485 031 
Profit for the year attributable to shareholders                                            5 119 329          5 021 171 
Ordinary dividends declared during the year                                                (1 856 719)        (1 135 277)
- total dividends declared                                                                 (2 512 926)        (1 535 677)
- dividends on treasury shares held in BEE trusts                                             656 207            400 400                                                                                                                         
Balance at end of year                                                                     30 633 535         27 370 925 
Ordinary shareholders’ interest                                                            26 091 352         22 649 300 
Non-controlling shareholders’ interests                                                                                  
Balance at beginning of year                                                                  (24 348)           (33 871)
Share of total comprehensive (loss)/income                                                    (16 642)             9 523 
- share of total comprehensive income                                                          57 709            104 364 
- profit for the year                                                                          55 673            117 159 
- other comprehensive income/(loss)                                                             2 036            (12 795)
- dividends paid to non-controlling shareholders                                              (74 351)           (94 841)                                                                                                                        
Balance at end of year                                                                        (40 990)           (24 348)
Total equity                                                                               26 050 362         22 624 952 


CONDENSED SEGMENTAL INFORMATION FOR THE YEAR ENDED 30 JUNE 2018

                                                                 Associate mining and beneficiation                       
R’000                                                        Iron ore         Manganese          Chrome         Sub-total 
Year ended 30 June 2018 - reviewed                                                                                        
Revenues                                                                                                                  
Third party                                                15 135 316        12 859 636         180 309        28 175 261 
Inter-segment                                                       -                 -               -                 - 
Total revenues                                             15 135 316        12 859 636         180 309        28 175 261 
Contribution to profit 1                                    3 343 512         3 771 662         (41 650)        7 073 524 
Impairment of financial and non-financial assets                    -           (51 900)              -           (51 900)
Statement of financial position                                                                                           
Consolidated total assets                                  23 149 661        17 988 956         524 319        41 662 936 
Consolidated total liabilities                              6 076 881         3 190 147         426 352         9 693 380 
Year ended 30 June 2017 - audited                                                                                         
Revenues                                                                                                                  
Third party                                                16 398 968        10 238 065         207 764        26 844 797 
Inter-segment                                                       -                 -               -                 - 
Total revenues                                             16 398 968        10 238 065         207 764        26 844 797 
Contribution to profit 1                                    4 372 631         2 181 569          (6 746)        6 547 454 
Impairment of financial and non-financial assets 1                  -          (138 976)       (746 007)         (884 983)
Consolidated total assets                                  25 571 400        13 519 306         554 089        39 644 795 
Consolidated total liabilities                              5 930 711         2 754 092         414 120         9 098 923 
1 After taxation.                                                                                                         


CONDENSED SEGMENTAL INFORMATION FOR THE YEAR ENDED 30 JUNE 2018 (CONTINUED)

                                                                                             Other mining                  
                                                                               Marketing       activities,                 
                                                                                     and     eliminations                  
R’000                                                      Dwarsrivier          shipping  and adjustments     Consolidated 
Year ended 30 June 2018 - reviewed                                                                                         
Revenues                                                                                                                   
Third party                                                  3 892 752         3 974 210      (28 237 486)       7 804 737 
Inter-segment                                                        -            18 305          (18 305)               - 
Total revenues                                               3 892 752         3 992 515      (28 255 791)       7 804 737 
Contribution to profit 1                                       875 378           703 879       (6 985 855)       1 666 926 
Impairment of financial and non-financial assets                     -            (9 519)          12 490          (48 929)
Statement of financial position                                                                                            
Consolidated total assets                                    3 884 794        25 300 630      (41 475 033)      29 373 327 
Consolidated total liabilities                               1 071 744         1 859 703       (9 301 862)       3 322 965 
Year ended 30 June 2017 - audited                                                                                          
Revenues                                                                                                                   
Third party                                                  3 410 363         3 573 061      (26 604 262)       7 223 959 
Inter-segment                                                        -             6 195           (6 195)               - 
Total revenues                                               3 410 363         3 579 256      (26 610 457)       7 223 959 
Contribution to profit 1                                       843 199         1 071 298       (6 573 094)       1 888 857 
Impairment of financial and non-financial assets 1                   -                 -           442 491        (442 492)
Consolidated total assets                                    1 511 650        23 366 628      (39 201 542)      25 321 531 
Consolidated total liabilities                                 824 167         1 823 961       (9 050 472)       2 696 579 
1 After taxation.


CORPORATE INFORMATION

Directors
Executive Desmond Sacco (Chairman)
CE Walters (Chief Executive Officer)
RA Davies (Finance)
PE Sacco (Marketing)
BH van Aswegen (Operations) 

Non-executive EM Southey* (Deputy Chairman and Lead Independent Director)
DN Aitken*,TN Mgoduso*, S Mhlarhi*, WF Urmson*
*Independent

Registered office
Assore House, 15 Fricker Road
Illovo Boulevard
Johannesburg, 2196

Company Secretary
African Mining and Trust Company Limited

Transfer office
Singular Systems Proprietary Limited
28 Fort Street
Birnam, 2196

Sponsor 
The Standard Bank of South Africa Limited

These results are also available on: www.assore.com
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