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Reviewed condensed consolidated financial results for the year ended 31 March 2018
Tsogo Sun Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1989/002108/06)
Share code: TSH ISIN: ZAE000156238
("Tsogo Sun" or "the company" or "the group")
Reviewed condensed consolidated financial results for the year ended 31 March 2018
- Income R14.0 billion up 6%
- Ebitdar R5.3 billion up 4%
- Adjusted HEPS 197.8 cents down 5%
- Final dividend per share 70 cents unchanged
COMMENTARY
REVIEW OF OPERATIONS
Trading for the year ended 31 March 2018 was impacted by the continued pressure on the consumer due to the
macro-economic environment, extremely weak sentiment and political uncertainty. The trading results were assisted
by the acquisition of Niveus Invest 19 Limited ("Gameco") comprising the Galaxy Bingo and Vukani Slots businesses
on 20 November 2017 and the acquisition of two hotel businesses from the Liberty Group ("Liberty") and Hospitality
Property Fund Limited ("HPF") in the prior year and negatively impacted in casino gaming by the opening of the Time
Square casino in Menlyn. The potential impact of the positive political developments have resulted in improved
sentiment which has not yet translated into a significant improvement in trading, although trading in the second
half was better than in the first half of the year. In the low-revenue growth environment cost control remained a
significant focus during the year.
In terms of the group's continued growth strategy R3.3 billion was spent during the year, including:
- the acquisition of Hosken Consolidated Investment Limited ("HCI") and all other shareholders' interests in Gameco
for a combination of 98.5 million Tsogo Sun shares and R1.7 billion in cash;
- the continued construction on the R1.6 billion expansion and refurbishment of the Suncoast Casino and Entertainment
World. The project includes past spend with the Salon Priv� scheduled to open in July 2018 and the remainder of the
project scheduled to open in December 2018. R291 million was spent during the year;
- the acquisition by HPF of various sections and exclusive use areas of the Sandton Eye sectional title scheme from
Savana Property Proprietary Limited and an existing real right of extension in the scheme from Sandton Isle
Investments Proprietary Limited for R302 million;
- the development of a US$16 million 125 room StayEasy in Maputo, Mozambique, which opened during April 2018.
R145 million was spent during the year;
- the opening of a new 504 room SunSquare and StayEasy branded leased hotel in the Cape Town City Bowl during
August 2017. The spend on furniture and fittings was R34 million during the year; and
- the group invested R670 million on replacement capex group-wide, including gaming system replacements and casino
floor and major hotel refurbishments, ensuring our assets remain best in class.
Total income for the year of R14.0 billion ended 6% above the prior year with a 6% growth in net gaming win and assisted
by a 9% growth in food and beverage revenue and strong growth in property rental income. The net gaming win growth is
assisted by the acquisition of Gameco during the year. Earnings before interest, income tax, depreciation, amortisation,
property rentals, long-term incentives and exceptional items ("Ebitdar") at R5.3 billion for the year was 4% up on the
prior year. Excluding the impact of the Gameco acquisition total income grew by 1% and Ebitdar was flat on the prior
year. The overall group Ebitdar margin of 37.7% is 0.5 percentage points ("pp") down on the prior year. The underlying
operations of the group remain highly geared towards the South African consumer (in gaming) and the corporate market (in
hotels). The high level of operational gearing still presents significant growth potential for the group should these
sectors of the South African economy improve.
Net casino gaming win for the year reduced by 2% on the prior year with slots win down 1% and tables win down 4% and
was negatively impacted by the opening of Time Square and a strong performance in the first quarter of the prior year in
Gauteng, mainly at Montecasino.
Gauteng recorded growth in provincial gaming win of 7.1% for the year. Gaming win growth of 2.9% was achieved at Gold
Reef City with a reduction at Montecasino of 4.5% and at Silverstar of 8.3%. Provincial gaming win was positively
impacted during the current year by the opening of the Time Square casino in Menlyn on 1 April 2017, although the impact
on the group's casinos, mainly at Montecasino and Silverstar, is significantly below expectation. Montecasino was, in
addition, also impacted by very strong tables win in the first quarter of the prior year.
KwaZulu-Natal provincial gaming win grew by 1.9% for the year. Gaming win reduced by 2.3% at Suncoast Casino and
Entertainment World and 8.8% at Blackrock Casino in Newcastle, impacted by disruptions to the local manufacturing
industry in that area, but grew by 1.1% at Golden Horse Casino in Pietermaritzburg. Provincial gaming win statistics
are not available from the gaming board for March 2018 and have been estimated.
Mpumalanga provincial gaming win was flat on the prior year. Gaming win growth of 0.2% was achieved at Emnotweni Casino
in Nelspruit with a reduction at The Ridge Casino in Emalahleni of 0.9% impacted by economic disruptions to the local
manufacturing industry in that area.
Eastern Cape provincial gaming win reduced by 0.4% on the prior year. Hemingways gaming win increased by 0.6% on the
prior year.
The Western Cape reported growth in provincial gaming win of 1.1% for the year. The Garden Route Casino in Mossel Bay
and Mykonos Casino in Langebaan reported growth of 4.1% and 10.2% respectively with the Caledon Casino, Hotel and Spa
reducing by 2.7% on the prior year.
Goldfields Casino in Welkom in the Free State experienced difficult trading conditions but grew gaming win by 2.1% on
the prior year.
Other Gaming division operations consisting of the Sandton Convention Centre, head office costs and dividend income
reflected a net cost of R141 million, a decrease of R13 million on the prior year mainly due to four quarterly dividends
received from SunWest in the current year where only three quarterly dividends were received in the prior year.
Overall income for the casino gaming division decreased 1% on the prior year to R9.0 billion. Ebitdar decreased 4% on
the prior year to R3.4 billion at a margin of 37.7%, 1.1pp below the prior year with particularly good control on
overheads mitigating the reduction in net gaming win.
Overall income for the Galaxy and Vukani ("Gameco") gaming businesses from 20 November 2017 was R263 million and
R362 million respectively. Ebitdar was R69 million and R169 million respectively at a margin of 26.2% and 46.7%
respectively.
Overall hotel industry occupancies in South Africa have reduced to 64.2% (2017: 65.2%) for the year. Occupancies in
Cape Town have weakened, particularly during the last quarter as a result of the impact of the water crisis. Trading for
the group's South African hotels for the year recorded system-wide revenue per available room ("RevPar") flat on the
prior year due to flat average room rates at R1 066, with occupancies slightly up on the prior year at 64.7% (2017: 64.3%).
Overall revenue for the South African hotels division increased 8% on the prior year to R3.8 billion assisted by the
inclusion of the Garden Court Umhlanga and the StayEasy Pietermaritzburg from October 2016, the consolidation of HPF from
September 2016 and the opening of the SunSquare and StayEasy City Bowl hotels on 1 September 2017. Ebitdar increased by
8% on the prior year to R1.5 billion at a margin of 38.7% (2017: 38.7%).
The offshore division of hotels achieved total revenue of R565 million which was 11% down on the prior year impacted
by tough local economic environments due mainly to the reduction in commodity prices impacting the local economies
negatively. This was further adversely impacted by the strengthening of the Rand against the US Dollar. Ebitdar
(pre-foreign exchange gains/losses) decreased by 18% to R119 million. Foreign exchange gains of R1 million
(2017: R38 million loss) were incurred on the translation of offshore monetary items, principally between local
country currencies and the US Dollar.
Combined South African and offshore hotel trading statistics, reflecting the Tsogo Sun group-owned hotels and
excluding hotels managed on behalf of third parties and those in HPF managed by third parties, are as follows:
For the year ended 31 March 2018 2017
Occupancy (%) 63.5 63.3
Average room rate (R) 1 045 1 063
RevPar (R) 664 672
Rooms available ('000) 4 763 4 578
Rooms sold ('000) 3 024 2 895
Rooms revenue (Rm) 3 160 3 078
The decrease in average room rate is impacted by US Dollar average rate weakness and effect of the Rand strength on
the offshore portfolio.
Operating expenses including gaming levies and VAT and employee costs, but excluding exceptional items and long-term
incentives, increased by 6% on the prior year mainly due to non-organic growth in the business as a result of
acquisitions and expansions, offset by savings initiatives. Excluding the non-organic growth and foreign exchange
gains/losses, operating expenses increased by only 1% due to tight overhead control. Non-organic represents all new
business operations commencing during the current and prior year.
Property rentals at R282 million are 16% up on the prior year mainly due to the opening of the SunSquare and StayEasy
Cape Town City Bowl hotels on 1 September 2017, offset by the renegotiation of the Southern Sun Nairobi lease.
Amortisation and depreciation at R912 million is 8% up on the prior year due mainly to the capital spend during the
current and prior years.
The long-term incentive credit on the cash-settled incentive scheme of R24 million values the liability (including
dividend adjustments) by reference to the company's share price which is adjusted for management's best estimate of the
appreciation units expected to vest and future performance of the group. A share price of R25.50 was used to value the
liability at 31 March 2018.
Exceptional losses for the year of R439 million relate to fair value losses on the revaluation of investment
properties of R191 million, mainly related to the non-Tsogo leased hotels in HPF, goodwill and intangible asset impairments
of R112 million, preopening costs of R19 million, transaction costs of R33 million, restructure costs of R38 million and
plant and equipment disposals and impairments of R70 million, mainly related to the Suncoast expansion, interest rate swap
fair value adjustments of R2 million and fair value losses on non-current assets held for sale of R1 million, offset by
previously impaired loans recovered net of impairments of R27 million. Exceptional gains for the prior year of R787 million
relate to fair value gains on the revaluation of investment properties of R757 million related to the non-Tsogo leased hotels
in HPF, the release of a fair value reserve for the available-for-sale HPF investment of R46 million, profit on sale of
investment properties of R36 million related to the Inn on the Square disposed of by HPF and gains on bargain purchases of
R82 million, offset by property, plant and equipment disposals and impairments and loan impairments of R94 million, including
an impairment of the Southern Sun Ikoyi of R75 million, interest rate swap fair value adjustments of R6 million and transaction
and restructure costs of R34 million.
Net finance costs of R1.2 billion are 13% above the prior year due to the increase in debt to fund the growth
strategy.
The share of profit of associates and joint ventures of R63 million improved by R25 million on the prior year mainly
due to earnings, including the group's share of exceptional gains of R15 million, from International Hotel Properties
Limited and RBH Hotel Group Limited, the group's European hotel investments.
The effective tax rate, which excludes the group's share of profit of associates and joint ventures, for the year of
16.4% is impacted by the release of deferred tax liabilities of R307 million on the disposal of assets to HPF, tax exempt
dividend income, pre-tax profits attributable to the HPF non-controlling interests due to its real estate investment
trust ("REIT") tax status, offset by the non-deductible fair value losses on investment property referred to above and
non-deductible expenditure such as casino building depreciation. The effective tax rate for the prior year of 18.1% is
impacted by the non-taxable fair value gains on investment property and the gains on bargain purchases referred to above,
the release of deferred tax liabilities of R56 million on the disposal of assets to HPF, tax exempt dividend income,
pre-tax profits attributable to the HPF non-controlling interests due to its REIT tax status, deductible foreign exchange
losses on local country currency movements in the African operations that reverse on consolidation and offshore tax rate
differentials, offset by non-deductible expenditure such as casino building depreciation and the effective interest on the
SunWest and Worcester acquisition.
Profit attributable to non-controlling interests of R187 million is R355 million below the prior year mainly due to
the HPF non-controlling interests' share of the fair value losses on investment properties in the current year and gains
in the prior year, offset by increased local currency profits at Southern Sun Ikoyi and Southern Sun Maputo due to
foreign exchange losses in the prior year not repeated in the current year.
Group adjusted headline earnings for the year at R2.0 billion ended 1% below the prior year. The adjustments include
the reversal of the post-tax impacts of the exceptional gains or losses noted above, in addition to the release of the
deferred tax liabilities of R307 million noted in taxation above and the exceptional gains in the share of profit of
associates and joint ventures, net of tax and non-controlling interests. The adjustments in the prior year include the
reversal of the post-tax impacts of the exceptional gains or losses noted above, in addition to the reversal of the
remeasurement of the Cullinan put option included in net finance costs, the release of deferred tax liabilities of
R56 million noted in taxation above and the exceptional gains in the share of profit of associates and joint ventures,
net of tax and non-controlling interests.
The number of shares in issue increased during the year on the acquisition of Gameco with the weighted average increasing
by 4% and the resultant adjusted headline earnings per share is 5% down on the prior year at 197.8 cents per share.
Cash generated from operations for the year reduced by 8% on the prior year to R4.4 billion. Net finance costs increased
by 7% due to the increase in net debt, taxation paid increased by 10% mainly due to refunds received from SARS in the
prior year, dividends paid to shareholders and non-controlling interests increased by 8% and the prior year included a
HPF pre-acquisition dividend paid of R133 million. Cash flows utilised for investment activities of R2.1 billion (net of
the R1.0 billion rights issue in HPF) consisted mainly of replacement capital expenditure and the acquisitions and
investments described above.
Interest-bearing debt net of cash at 31 March 2018 totalled R12.5 billion, which is R0.4 billion above the 31 March 2017
balance of R12.1 billion, with R1.2 billion paid in dividends to group shareholders in addition to the investment
activities during the year. The increase is mainly due to the additional funding for the group's expansion programme.
PROSPECTS
Given the weak state of the South African economy and many of the commodity focused countries in which the group
operates, trading is expected to remain under pressure. Growth will depend on how these economies perform going forward,
including the impact of changes in commodity prices and the level of policy certainty that the government is able to
achieve. Nevertheless, the group remains highly cash generative and is confident in achieving attractive returns from the
growth strategy once the macro-economic environment improves.
The group continues to implement a variety of projects and acquisitions including:
- the internal restructuring and negotiations with HPF for the acquisition by HPF of certain of the casino precinct
properties currently owned by the group in consideration for the issue by HPF of new shares in HPF, and the unbundling
of the group's entire interest in HPF as announced on SENS on 2 March 2018 and updated on SENS on 18 April 2018;
- the potential to bid for the relocation of one of the smaller casinos in the Western Cape to the Cape Metropole
remains an opportunity for the group should the provincial authorities allow such a process. The Western Cape Provincial
Treasury published a draft Bill and Regulations intended to permit the relocation of outlying casinos to within the
Metropole;
- the acquisition of additional hotel properties by International Hotel Properties Limited, which currently owns nine
hotels in the United Kingdom, is anticipated in the future and the group may apply additional capital in this regard.
DIVIDEND
Subsequent to year end, the board of directors has declared a final gross cash dividend from income reserves in respect
of the year ended 31 March 2018 of 70.0 (seventy) cents per share. The dividend has been declared in South African
currency and is payable to shareholders recorded in the register of the company at close of business Friday, 15 June 2018.
The number of ordinary shares in issue at the date of this declaration is 1 059 189 290 (excluding treasury shares of
88 468 494). The dividend will be subject to a local dividend tax rate of 20%, which will result in a net dividend of
56.0 cents per share to those shareholders who are not exempt from paying dividend tax. The company's tax reference number
is 9250039717.
In compliance with the requirements of Strate, the electronic and custody system used by the JSE, the following dates
are applicable in 2018:
Last date to trade cum dividend Tuesday, 12 June
Shares trade ex dividend Wednesday, 13 June
Record date Friday, 15 June
Payment date Monday, 18 June
Share certificates may not be dematerialised or rematerialised during the period Wednesday, 13 June 2018 and Friday,
15 June 2018, both days inclusive. On Monday, 18 June 2018, the cash dividend will be electronically transferred to the
bank accounts of all certificated shareholders where this facility is available. Where electronic fund transfer is not
available or desired, cheques dated 18 June 2018 will be posted on that date. Shareholders who have dematerialised their
share certificates will have their accounts at their CSDP or broker credited on Monday, 18 June 2018.
SUBSEQUENT EVENTS
The directors are not aware of any matter or circumstance arising since the end of the financial year, not otherwise
dealt with within the financial statements that would affect the operations or results of the group significantly.
PRESENTATION
Shareholders are advised that a presentation to various analysts and investors which provides additional analysis and
information will be available on the group's website at www.tsogosun.com.
FORWARD-LOOKING INFORMATION DISCLAIMER
Any forward-looking information included in Prospects above has not been reviewed or reported on by the company's
external auditors.
J Booysen RB Huddy
Chief Executive Officer Chief Financial Officer
23 May 2018
INDEPENDENT AUDITOR'S REVIEW REPORT ON CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
TO THE SHAREHOLDERS OF TSOGO SUN HOLDINGS LIMITED
We have reviewed the condensed consolidated financial statements of Tsogo Sun Holdings Limited, which comprise
the condensed consolidated balance sheet as at 31 March 2018 and the related condensed consolidated income statement,
condensed consolidated statement of comprehensive income, condensed consolidated statement of changes in equity and
condensed consolidated cash flow statement for the year then ended, and selected explanatory notes.
DIRECTORS' RESPONSIBILITY FOR THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
The directors are responsible for the preparation and presentation of these condensed consolidated financial
statements in accordance with the requirements of the JSE Limited Listings Requirements for provisional reports,
as set out in note 1 to the financial statements, and the requirements of the Companies Act of South Africa, and
for such internal control as the directors determine is necessary to enable the preparation of financial statements
that are free from material misstatement, whether due to fraud or error.
AUDITOR'S RESPONSIBILITY
Our responsibility is to express a conclusion on these financial statements. We conducted our review in accordance
with International Standard on Review Engagements ("ISRE") 2410, which applies to a review of historical financial
information performed by the independent auditor of the entity. ISRE 2410 requires us to conclude whether anything
has come to our attention that causes us to believe that the financial statements are not prepared in all material
respects in accordance with the applicable financial reporting framework. This standard also requires us to comply
with relevant ethical requirements.
A review of financial statements in accordance with ISRE 2410 is a limited assurance engagement. We perform procedures,
primarily consisting of making enquiries of management and others within the entity, as appropriate, and applying
analytical procedures, and evaluate the evidence obtained. The procedures performed in a review are substantially less
than those performed in an audit conducted in accordance with International Standards on Auditing. Accordingly, we do
not express an audit opinion on these financial statements.
CONCLUSION
Based on our review, nothing has come to our attention that causes us to believe that the condensed consolidated
financial statements of Tsogo Sun Holdings Limited for the year ended 31 March 2018 are not prepared, in all material
respects, in accordance with the requirements of the JSE Limited Listings Requirements for provisional reports, as set
out in note 1 to the financial statements, and the requirements of the Companies Act of South Africa.
PricewaterhouseCoopers Inc.
Director: BS Humphreys
Registered Auditor
Johannesburg
23 May 2018
NOTES TO THE REVIEWED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE YEAR ENDED 31 MARCH 2018
1 BASIS OF PREPARATION
The condensed consolidated financial statements for the year ended 31 March 2018 have been prepared in accordance
with the requirements of the JSE Limited Listings Requirements ("Listings Requirements") for provisional reports
and the requirements of the Companies Act of South Africa. 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") as issued by the International Accounting Standards Board
("IASB"), the preparation and disclosure requirements of IAS 34 Interim Financial Reporting, the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee and Financial Reporting Pronouncements as issued
by the Financial Reporting Standards Council ("FRSC"). Chief Financial Officer, RB Huddy CA(SA), supervised the
preparation of the condensed consolidated financial statements. The accounting policies applied in the preparation
of the condensed consolidated financial statements are in terms of IFRS and are consistent with those applied in
the previous consolidated annual financial statements as at 31 March 2017 other than as described in note 2. The
condensed consolidated financial statements should be read in conjunction with the annual financial statements
for the year ended 31 March 2017, which have been prepared in accordance with IFRS. These condensed consolidated
financial statements for the year ended 31 March 2018 have been reviewed by PricewaterhouseCoopers Inc., and their
unmodified review conclusion is included above.
2 CHANGE IN ACCOUNTING POLICIES AND INTERPRETATIONS
The group has adopted all the new, revised or amended accounting standards as issued by the IASB which were effective
for the group from 1 April 2017, none of which had a material impact on the group.
IFRS 9 Financial Instruments
IFRS 9 Financial Instruments addresses the classification, measurement and derecognition of financial assets and
financial liabilities, introduces new rules for hedge accounting and a new impairment model for financial assets.
The group has reviewed its financial assets and financial liabilities and is expecting the following impact from
the adoption of the new standard on 1 April 2018:
Classification and measurement
The majority of financial assets held by the group include:
- debt instruments - trade and other receivables - currently classified as loans and receivables and are measured
at amortised cost. Trade and other receivables continue to qualify for measurement at amortised cost under IFRS
9 because they are held to collect contractual cash flows comprising principal and interest, therefore there is
no change to the accounting for these assets; and
- an investment in unlisted equity instruments - these are currently classified as available-for-sale financial
assets for which the fair value through other comprehensive income ("FVOCI") and fair value through profit or loss
("FVPL") election are available. The group has elected to measure equity instruments at FVOCI.
Accordingly, the group does not expect the new guidance to affect the classification and measurement of these
financial assets. There will be no impact on the group's accounting for financial liabilities, as the new requirements
only affect the accounting for financial liabilities that are designated at FVPL and the group does not have any such
liabilities. The derecognition rules have been transferred from IAS 39 Financial Instruments: Recognition and Measurement
and have not been changed.
Hedge accounting
The new hedge accounting rules will align the accounting for hedging instruments more closely with the group's risk
management practices. The group has confirmed that its current hedge relationships will qualify as continuing hedges
upon the adoption of IFRS 9.
Impairment
Trade and other receivables is the most significant financial asset in the group that will be impacted. The provision
matrix is used to calculate expected credit losses. The impact of forward-looking information is immaterial on trade
receivables and as such no significant impact was noted on adoption.
Disclosure
The new standard also introduces expanded disclosure requirements and changes in presentation. These are expected to
change the nature and extent of the group's disclosures about its financial instruments particularly in the year of
the adoption of the new standard.
Date of adoption
The impact of applying IFRS 9 will be adjusted against opening retained earnings on 1 April 2018 and comparatives
will not be restated.
IFRS 15 Revenue from Contracts with Customers
As the group recognises significantly all of its revenue at a point in time, there will be no significant impact on the
group's revenue recognition by the adoption of the new standard, IFRS 15 Revenue from Contracts with Customers. The impact
on the group's customer loyalty programmes will also not be significant. IFRS 15 must be applied for financial years
commencing on or after 1 January 2018. The group will apply the new standard from 1 April 2018.
IFRS 16 Leases
The group is in the process of assessing the possible impact of the application of IFRS 16 Leases which has been issued
but is not effective at year end.
The Sandton Convention Centre and some hotel property leases (accounted for as operating leases), where the group is the
lessee, will be mostly impacted. IFRS 16 must be applied for financial years commencing on or after 1 January 2019. The
group will apply the new standard from 1 April 2019.
3 FAIR VALUE ESTIMATION
As shown below, the group fair values its investment properties, interest rate swaps and its available-for-sale
investments. There were no transfers into or out of level 3 financial instruments.
3.1 Interest rate swaps
The fair value of the group's derivatives used for hedge accounting is a net liability of R135 million (31 March 2017:
R51 million) and is calculated as the present value of the estimated future cash flows based on observable yield curves,
which is consistent with the prior year.
The group has interest rate swaps that are effective with a fair value net liability of R133 million (2017: R50 million),
as well as interest rate swaps from HPF that are not effective with a net liability of R2 million (2017: R1 million)
being level 2 fair value measurements.
3.2 Investment properties
The movement of investment properties for the year is as follows:
2018 2017
Reviewed Audited
Rm Rm
Opening net carrying amount 4 969 108
Acquisition and development of investment properties 471 92
Disposals - (106)
Acquisition of subsidiary (note 5) 6 4 185
Transfers - (67)
Fair value adjustments recognised in profit or loss (191) 757
Closing net carrying amount 5 255 4 969
The group's investment properties have been categorised as level 3 values based on the inputs to the valuation
technique used. The group has elected to measure investment properties at fair value. The fair value is determined
by using the discounted cash flow method by discounting the rental income (based on expected net cash flows of the
underlying hotels) after considering the capital expenditure requirements. The expected cash flows are discounted
using an appropriate discount rate. The core discount rate is calculated using the R186 (long bond) at the time of
valuation, to which is added premiums for market risk and equity and debt costs. The discount rate takes into account
a risk premium associated with the local economy as well as that specific to the local property market and the hotel
industry. At 31 March 2018, the group's investment properties were independently valued by professionally qualified
valuers having recent experience in the locations and categories of the group's investment property being valued.
As at 31 March 2018 the significant unobservable inputs were as follows:
- A weighted average rental growth rate of 5.0% (2017: 5.5%);
- A terminal capitalisation rate of 7.23% - 8.07% (2017: 7.26%); and
- A risk-adjusted discount rate of 12.23% - 13.07% (2017: 12.76%).
The table below indicates the sensitivities of the aggregate investment property portfolio by increasing or
decreasing value inputs as follows:
2018 2017
Increase Decrease Increase Decrease
Rm Rm Rm Rm
5% change in the net cash flows 282 (283) 241 (241)
25bps change in the terminal capitalisation rate (121) 128 (116) 118
50bps change in the discount rate (373) 326 (203) 189
3.3 Available-for-sale investment
During the prior year, aligned with the group's desire to increase its exposure in the Western Cape province, the
group entered into a transaction with Sun International Limited ("SI") and Grand Parade Investments Limited ("GPI")
for the acquisition of a 20% equity interest in each of SunWest and Worcester. The group has pre-emptive rights but
no representation on the board of directors of either company and has no operational responsibilities. The group also
has no access to any information regarding the companies except for that to which it has statutory rights as a
shareholder. This investment is classified as a level 3 fair value measurement and has been accounted for as an
available-for-sale financial asset.
At the end of each reporting period the investment is remeasured and the increase or decrease recognised in other
comprehensive income. The asset has been remeasured to R1 275 million at 31 March 2018. A discounted cash flow
valuation was used to estimate the fair value. The valuation model considers the present value of net cash flows to
be generated from SunWest and Worcester, together with its operating capital expenditure taking into account expected
growth in gaming win and other revenue generated from non-gaming related activities. The expected net cash flows are
discounted using a risk-adjusted discount rate. Among other factors, the discount rate estimation considers risks
associated with the gaming and hospitality industry in which SunWest and Worcester operates.
As at 31 March 2018 the significant unobservable inputs were as follows:
- Expected gaming win growth between 4.3% and 6.3% (2017: 4.3% and 7.0%);
- Operating expenditure cost growth between 5.1% and 5.6% (2017: 5.5% and 6.5%);
- Risk-adjusted discount rate of 11.3% (2017: 12.3%); and
- Long-term growth rate of 5.6% (2017: 5.6%).
The table below indicates the sensitivities for the valuation by increasing or decreasing the above inputs by 1%:
2018 2017
Increase Decrease Increase Decrease
Rm Rm Rm Rm
Expected gaming win growth 281 (260) 265 (245)
Operating expenditure cost growth (239) 221 (203) 188
Risk-adjusted discount rate (208) 298 (185) 251
Long-term growth rate 178 (125) 143 (106)
Total 12 134 20 88
SI put option
In terms of the acquisition agreement of the SunWest and Worcester interests, in the event that any party
acquires 35% or more of the issued ordinary shares of SI triggering a change in control of the SI group,
the group may elect to put its equity interests in SunWest and Worcester to SI. SI can elect to either
settle the put option by the issue of new ordinary shares in SI and/or for a cash consideration, based on
the aggregate value of the group's interest in SunWest and Worcester. At the end of each reporting period
the derivative is remeasured and the increase or decrease recognised in the income statement. The
derivative is calculated in accordance with the terms of the put option agreement, effectively a 7.5 times
Ebitda multiple valuation of the SunWest and Worcester assets, less net debt, times the 20% shareholding
the group holds. No derivative has been recognised as the fair value of the option is Rnil at 31 March 2018
(Rnil at 31 March 2017).
4 TRANSACTIONS WITH NON-CONTROLLING INTERESTS
The following transactions with non-controlling interests ("NCI") were concluded during the year under review:
4.1 Acquisition of 29 hotel properties by HPF from Tsogo Sun
HPF acquired two Tsogo Sun subsidiaries which in aggregate hold a portfolio of 29 hotel properties for an
aggregate purchase consideration of R3.6 billion settled R1.03 billion in cash (by way of a renounceable
rights offer to Hospitality shareholders) and R2.6 billion in shares. This transaction received shareholder
approval at the HPF general meeting held on 10 July 2017. The impact of this transaction is a transaction
with the NCI of HPF whereby NCI in HPF have been acquired and as a result the group's effective holding
increased from 50.6% to 67.8% with effect from 10 July 2017. The overall value of the NCI acquired after
also taking into account the effect of the rights issue below was R436 million and the consideration in
hotel assets to HPF's NCI was R1.066 billion. The acquisition of the 29 hotel properties by HPF resulted
in the deferred tax liability in Merway and Cullinan of R307 million being derecognised due to HPF's REIT
tax status.
4.2 HPF rights issue
HPF shareholders were offered a total of 71 428 571 HPF shares ("rights offer shares") at an issue price
of R14.00 per rights offer share in the ratio of 21.76820 rights offer shares for every 100 HPF shares
held on the record date of the rights offer. As a result of 99.2% of the rights offer shares being subscribed
for by third parties, the group's effective holding decreased from 67.8% (refer note above) to 59.4% in HPF
with effect from 4 August 2017. The overall effect of this transaction with NCI is mentioned above.
The resulting transactions with NCI are as follows:
Rm
Hotel assets sold to HPF 2 626
NCI share in hotel assets sold to HPF (40.6%) 1 066
Total consideration received from HPF (1 466)
NCI acquired by Tsogo Sun through share issue from HPF to Tsogo Sun (436)
Cash received from HPF (1 030)
Gain in transacting with NCI in other reserves (400)
4.3 Sandton Eye and Real Right of Extension
With effect 31 August 2017, HPF issued the last tranche of 2 150 856 shares to Savana Property Proprietary
Limited ("Savana") as part settlement in terms of an agreement concluded with Savana to acquire various
sections and exclusive use areas of the Sandton Eye sectional title scheme and an agreement with Sandton
Isle Investments Proprietary Limited to acquire an existing real right of extension in the scheme for an
aggregate purchase consideration of R302 million of which R271 million was settled in cash and 2 150 856 HPF
shares were issued (Sandton Eye is part of Radisson Gautrain). As a result of this issue, the group's effective
holding was diluted from 59.4% (refer note above) to 59.2%. The value acquired by non-controlling interests was
R15 million.
5 COMMON CONTROL ACQUISITION
Acquisition of certain gaming businesses from Niveus Investments Limited ("Niveus")
Shareholders are referred to the various SENS announcements released by Tsogo Sun during the prior year together
with the final SENS issued on 2 January 2018, in respect of, inter alia, the group's acquisition of the shares
in Niveus Invest 19 Limited ("Gameco") the holding company of certain gaming businesses in the Niveus group. All
conditions precedent to the transaction were fulfilled and/or waived and the transaction's effective date was
20 November 2017. In total, 50.8% of the shares were acquired from HCI with effect from 20 November 2017 and an
offer to purchase the remaining 49.2% NCI was made on 15 November 2017. In consideration for their Gameco shares
the NCI received one ordinary Tsogo Sun share ("consideration share") for every 2.875 Gameco shares or at their
election, 20% in consideration shares (in the ratio of one consideration share for every 2.875 Gameco shares)
and 80% of R9.796 per Gameco share in cash ("cash-based alternative").
The transaction is deemed to be a transaction under common control and consequently falls outside the scope of IFRS 3
Business Combinations. Tsogo Sun's accounting policy is to apply predecessor accounting to common control transactions.
Common control accounting is applied as the purchase is from HCI, the company's controlling shareholder and under the
predecessor accounting method, assets and liabilities acquired, including goodwill acquired, are recognised at the
predecessor values with the difference between the acquisition value and the aggregate purchase consideration recognised
as a separate reserve in equity.
The acquisition of Gameco is in keeping with the group's strategy of expanding its gaming operations. The identifiable
assets less liabilities assumed at acquisition date is less than the value of the consideration paid at the date of
acquisition, and therefore the group recognised a common control reserve in the statement of changes in equity of
R3.2 billion:
Rm
Property, plant and equipment 468
Investment properties 6
Goodwill 48
Other intangible assets 10
Other non-current assets 3
Deferred tax assets 32
Inventory 8
Other current assets 170
Cash and cash equivalents 191
Other non-current liabilities (6)
Other current liabilities (391)
Income tax liabilities (15)
Total identifiable net assets assumed from Gameco 524
NCI 38
Total carried forward 562
Rm
Total brought forward 562
Less: Purchase consideration (3 716)
Consideration in the form of Tsogo Sun shares to HCI (1 625)
Consideration in the form of Tsogo Sun shares to NCI (358)
Consideration in the form of cash payable (1 733)
Common control reserve arising on transaction (3 154)
Net cash flow:
Cash consideration to acquire Gameco (1 733)
Add: Cash balances acquired with Gameco 191
Net outflow of cash (1 542)
As part of this transaction the group paid an amount of R95 million for the purchase of Niveus Invest 1, which
owns the Grand Oasis Casino "Kuruman", from Niveus which requires the approvals by the Northern Cape Gambling
Board, and as these approvals had not been obtained by 31 March 2018, this payment has been accounted for as a
prepayment.
Excluding the funding impact and by using the group's accounting policies, had the acquisition occurred on
1 April 2017, the group's income would have increased by R983 million and adjusted earnings would have increased
by R157 million.
Transaction-related costs of R18 million were incurred during the year and recognised in other operating expenses
in the income statement. R9 million share issue costs were also incurred and debited to the share premium account.
6 CHANGES IN INTEREST-BEARING BORROWINGS ARISING FROM FINANCING ACTIVITIES
Changes arising from financing activities for 2018 related to interest-bearing borrowings excluding bank overdrafts
from short-term borrowings of R1 707 million (2017: R1 699 million), are as follows:
Long-term Short-term Total
Rm Rm Rm
Balance at 1 April 2017 9 439 3 399 12 838
Borrowings raised 5 961 533 6 494
Borrowings repaid (2 602) (2 997) (5 599)
Currency translation (129) - (129)
Other (2) 6 4
Balance at 31 March 2018 12 667 941 13 608
7 OTHER SIGNIFICANT TRANSACTIONS
7.1 StayEasy Maputo hotel development
The development of the StayEasy Maputo hotel was substantially completed by the end of March 2018 and was
included in plant, property and equipment categorised as "Property under construction" having a cost of
R145 million, including capitalised finance costs of R9 million. The hotel commenced trading during April 2018.
7.2 Cape Town City Bowl hotels
During September 2017, the new SunSquare and StayEasy City Bowl hotels in Cape Town commenced trading. Included
in property rental costs are rentals of R28 million related to these new leased hotels.
7.3 Planned disposal of various casino properties to HPF
The group continues with the project of the internal restructuring and negotiations with HPF for the acquisition
by HPF of certain of the casino precinct properties currently owned by the group in consideration for the issue
by HPF of new shares in HPF, and the unbundling of the group's entire interest in HPF as announced on SENS on
2 March 2018 and updated on SENS on 18 April 2018. As the necessary shareholder approvals, which is a substantive
condition for the transaction to take place, are not considered to be highly probable by the board of directors,
these assets have not been classified as non-current assets held for sale.
8 SEGMENT INFORMATION
In terms of IFRS 8 Operating Segments the chief operating decision maker has been identified as the group's Chief
Executive Officer and the Group Executive Committee. Management has determined the operating segments based on the
reports reviewed by the chief operating decision maker. There has been no change in the basis of segmentation or
in the basis of measurement of segment profit or loss from the last annual financial statements, other than the
Gameco operations being included in the Gaming division with effect 20 November 2017 (the acquisition date - refer
note 5).
The group's CEO and GEC assess the performance of the operating segments based on Ebitdar. The measure excludes the
effects of long-term incentives and the effects of non-recurring expenditure. The measure also excludes all headline
earnings adjustments, impairments and fair value adjustments on non-current and current assets and liabilities.
Interest income and finance costs are not included in the results for each operating segment as this is driven by
the group treasury function which manages the cash and debt position of the group.
9 CAPITAL COMMITMENTS
The board has committed a total of R3.3 billion for replacement and expansion capital items at its gaming and
hotel properties of which R2.3 billion is anticipated to be spent during the next financial year. R979 million
of the committed capital expenditure has been contracted for.
10 CONTINGENT LIABILITIES
The group had no significant contingent liabilities as at 31 March 2018.
11 RELATED PARTY TRANSACTIONS
The group had no significant related party transactions during the year under review, other than the group concluding
the common control acquisition of Gameco with Hosken Consolidated Investments Limited ("HCI") as noted in note 5.
12 EVENTS OCCURRING AFTER THE BALANCE SHEET DATE
Other than the dividend declaration noted below, no other events occurred after the balance sheet date.
Dividend declaration
Subsequent to the company's year end, on 23 May 2018, the board of directors declared a final gross cash dividend of
70 cents per share in respect of the year ended 31 March 2018. The aggregate amount of the dividend, which will be
paid on 18 June 2018 out of retained earnings at 31 March 2018, not recognised as a liability at year end is
R745 million.
Condensed consolidated income statement
for the year ended 31 March
2018 2017
Change Reviewed Audited
% Rm Rm
Net gaming win 6 7 940 7 483
Rooms revenue 3 3 160 3 078
Food and beverage revenue 9 1 561 1 434
Property rental income 23 549 445
Other revenue (2) 765 782
Income 6 13 975 13 222
Gaming levies and value added tax (1 681) (1 557)
Property and equipment rentals (380) (303)
Amortisation and depreciation (912) (846)
Employee costs (3 184) (3 044)
Other operating expenses (3 965) (3 530)
Fair value adjustment of investment properties (191) 757
Operating profit (22) 3 662 4 699
Interest income 72 43
Finance costs (1 229) (1 066)
Share of profit of associates and joint ventures 63 38
Profit before income tax 2 568 3 714
Income tax expense (410) (665)
Profit for the year 2 158 3 049
Profit attributable to:
Equity holders of the company 1 971 2 507
Non-controlling interests 187 542
2 158 3 049
Number of shares in issue (million) 1 059 957
Weighted average number of shares in issue (million) 994 957
Basic and diluted earnings per share (cents) (24) 198.3 262.0
Condensed consolidated statement of comprehensive income
for the year ended 31 March
2018 2017
Reviewed Audited
Rm Rm
Profit for the year 2 158 3 049
Other comprehensive income for the year, net of tax
Items that may be reclassified subsequently to profit or loss: (145) (194)
Cash flow hedges (83) (121)
Currency translation adjustments (86) (96)
Available-for-sale investment fair value adjustment 3 -
Income tax relating to items that may not subsequently be
reclassified to profit or loss 21 23
Items that may not be reclassified subsequently to profit or loss: 3 2
Remeasurements of post-employment defined benefit liability 4 3
Income tax relating to items that may not subsequently be
reclassified to profit or loss (1) (1)
Total comprehensive income for the year 2 016 2 857
Total comprehensive income attributable to:
Equity holders of the company 1 830 2 315
Non-controlling interests 186 542
2 016 2 857
Supplementary information
for the year ended 31 March
Change 2018 2017
% Reviewed Audited
Rm Rm
Reconciliation of earnings attributable to equity holders of
the company to headline earnings and adjusted headline earnings
Profit attributable to equity holders of the company 1 971 2 507
Loss on disposal of property, plant and equipment 2 12
Impairment of property, plant and equipment 68 77
Gain on disposal of investment property - (36)
Fair value adjustment of investment properties 191 (757)
Impairment of goodwill 20 -
Impairment of casino licences and bid costs (intangibles) 92 1
Impairment of equity loan to associate 7 -
Fair value adjustment on non-current assets held for sale 1 -
Gain on deemed disposal of financial asset classified as
available-for-sale - (46)
Gain on bargain purchases - (82)
Share of associates' headline earnings adjustments (7) 2
Total tax effects of adjustments (31) (27)
Total non-controlling interest effects of adjustments (76) 382
Headline earnings 10 2 238 2 033
Other exceptional items included in operating profit 58 44
Early debt settlement costs 3 -
Gain on remeasurement of put liability - (35)
Deferred tax liability derecognised on plant, property and
equipment on sale to the group's REIT subsidiary (307) (56)
Deferred tax asset derecognised on foreign subsidiary assessed
losses - 19
Share of associates' exceptional items (8) (11)
Total tax effects of adjustments (16) -
Total non-controlling interest effects of adjustments (2) (7)
Adjusted headline earnings (1) 1 966 1 987
Number of shares in issue (million) 1 059 957
Weighted average number of shares in issue (million) 994 957
Basic and diluted HEPS (cents) 225.2 212.4
Basic and diluted adjusted HEPS (cents) (5) 197.8 207.6
Reconciliation of operating profit to Ebitdar(1)
Ebitdar pre-exceptional items is made up as follows:
Operating profit 3 662 4 699
Add:
Property rentals 282 242
Amortisation and depreciation 912 846
Long-term incentive (credit)/expense (24) 49
4 832 5 836
Add/(less): Exceptional losses/(gains) 439 (787)
Loss on disposal of property, plant and equipment 2 12
Impairment of property, plant and equipment 68 77
Gain on disposal of investment property - (36)
Fair value adjustment of investment properties 191 (757)
Impairment of goodwill 20 -
Impairment of casino licences and bid costs (intangibles) 92 1
Impairment of equity loan to associate 7 -
Fair value adjustment on non-current assets held for sale 1 -
Gain on deemed disposal of financial asset classified as
available-for-sale - (46)
Gain on bargain purchases - (82)
Fair value adjustment on interest rate swaps 2 6
Impairment of financial instruments, net of recoveries (34) 4
Pre-opening expenses 19 -
Restructuring costs 38 7
Transaction costs 33 27
Ebitdar 4 5 271 5 049
(1) The measure excludes the effects of long-term incentives, non-recurring expenditure, headline earnings
adjustments including impairments and fair value adjustments on non-current and current assets and
liabilities and other exceptional items
Condensed consolidated cash flow statement
for the year ended 31 March
2018 2017
Reviewed Audited
Rm Rm
Cash flows from operating activities
Operating profit 3 662 4 699
Non-cash movements 1 623 425
Increase in working capital (891) (348)
Cash generated from operations 4 394 4 776
Interest received 72 43
Finance costs paid (1 220) (1 119)
3 246 3 700
Income tax paid (688) (627)
Dividends paid to shareholders (1 015) (975)
Dividends paid to non-controlling interests (161) (113)
Pre-acquisition dividend paid - (133)
Dividends received 110 134
Net cash generated from operating activities 1 492 1 986
Cash flows from investment activities
Purchase of property, plant and equipment - expansionary (546) (665)
Purchase of property, plant and equipment - replacement (564) (573)
Proceeds from disposals of property, plant and equipment 8 1
Acquisition and development of investment properties (443) (92)
Proceeds from disposal of investment property - 144
Purchase of intangible assets (20) (14)
Purchase of available-for-sale financial assets - (1 272)
Proceeds from disposal of non-current assets held for sale 1 -
Acquisition of Gameco, net of cash acquired (1 542) -
Acquisition of HPF, net of cash acquired - 189
Acquisition of Umhlanga and Pietermaritzburg businesses - (310)
Loans repaid by associates - 3
Other loans granted - (2)
Net cash utilised for investment activities (3 106) (2 591)
Cash flows from financing activities
Borrowings raised 6 494 4 156
Borrowings repaid (5 599) (2 651)
Treasury shares settled 86 -
Cash proceeds from rights issue to HPF non-controlling interests 995 -
Share issue expenses arising from the issue of shares for Gameco acquisition (9) -
Acquisition of non-controlling interests - (655)
Decrease in amounts due by share scheme participants 1 6
Net cash generated from financing activities 1 968 856
Net increase in cash and cash equivalents 353 251
Cash and cash equivalents at beginning of the year, net of bank overdrafts 725 479
Foreign currency translation (8) (5)
Cash and cash equivalents at end of the year, net of bank overdrafts 1 071 725
Condensed consolidated balance sheet
for the year ended 31 March
2018 2017
Reviewed Audited
Rm Rm
ASSETS
Non-current assets
Property, plant and equipment 16 038 15 556
Investment properties 5 255 4 969
Goodwill and other intangible assets 6 507 6 567
Investments in associates and joint ventures 641 609
Available-for-sale financial assets 1 275 1 272
Non-current receivables 66 60
Deferred income tax assets 142 121
29 924 29 154
Current assets
Inventories 119 115
Trade and other receivables 857 682
Derivative financial instruments - 14
Current income tax assets 36 78
Cash and cash equivalents 2 778 2 424
3 790 3 313
Non-current assets held for sale 66 66
Total current assets 3 856 3 379
Total assets 33 780 32 533
EQUITY
Capital and reserves attributable to equity holders of the company
Ordinary share capital and premium 6 636 4 576
Other reserves (2 040) 874
Retained earnings 6 280 5 321
Total shareholders' equity 10 876 10 771
Non-controlling interests 3 318 2 685
Total equity 14 194 13 456
LIABILITIES
Non-current liabilities
Interest-bearing borrowings 12 667 9 439
Derivative financial instruments 132 37
Deferred income tax liabilities 1 670 2 029
Provisions and other liabilities 468 511
14 937 12 016
Current liabilities
Interest-bearing borrowings 2 648 5 098
Trade and other payables 1 876 1 867
Current income tax liabilities 125 96
4 649 7 061
Total liabilities 19 586 19 077
Total equity and liabilities 33 780 32 533
Condensed consolidated statement of changes in equity
Attributable to equity holders of the company
Ordinary share Non-
capital and Other Retained controlling Total
premium reserves earnings Total interests equity
Rm Rm Rm Rm Rm Rm
Balance at 1 April 2016 (audited) 4 576 (232) 3 974 8 318 654 8 972
Total comprehensive income - (194) 2 509 2 315 542 2 857
Profit for the year - - 2 507 2 507 542 3 049
Other comprehensive income - (194) 2 (192) - (192)
Settlement of Cullinan put liability with non-controlling interests - 493 (187) 306 (306) -
Consideration to HPF non-controlling interests in hotels assets - 968 - 968 353 1 321
Acquisition of non-controlling interests from HPF - - - - 1 592 1 592
Acquisition of Mykonos and Blackrock casinos' non-controlling interests - (161) - (161) (37) (198)
Ordinary dividends - - (975) (975) (113) (1 088)
Balance at 31 March 2017 (audited) 4 576 874 5 321 10 771 2 685 13 456
Total comprehensive income - (144) 1 974 1 830 186 2 016
Profit for the year - - 1 971 1 971 187 2 158
Other comprehensive income - (144) 3 (141) (1) (142)
Issue of ordinary share capital 1 974 - - 1 974 - 1 974
Treasury shares settled 86 - - 86 - 86
Consideration to HPF non-controlling interests in hotels assets - (37) - (37) 1 067 1 030
Acquisition of non-controlling interests from HPF - 436 - 436 (436) -
Consideration to HPF non-controlling interests - Sandton Isle - (15) - (15) 15 -
Common control reserve arising on acquisition of Gameco - (3 154) - (3 154) - (3 154)
Acquisition activity Gameco - - - - (38) (38)
Ordinary dividends - - (1 015) (1 015) (161) (1 176)
Balance at 31 March 2018 (reviewed) 6 636 (2 040) 6 280 10 876 3 318 14 194
Segmental analysis
for the year ended 31 March
Income(1) Ebitdar(2) Ebitdar margin Amortisation and depreciation
2018 2017 2018 2017 2018 2017 2018 2017
Rm Rm Rm Rm % % Rm Rm
Casino gaming
Montecasino 2 625 2 694 1 135 1 196 43.3 44.4 111 111
Suncoast 1 681 1 732 752 810 44.7 46.8 84 88
Gold Reef City 1 497 1 450 569 549 38.0 37.9 118 109
Silverstar 686 735 212 248 30.9 33.7 80 82
Golden Horse 397 392 177 176 44.6 44.8 31 34
Emnotweni 381 383 136 145 35.7 37.9 28 29
The Ridge 381 382 145 147 38.0 38.6 30 29
Hemingways 314 306 97 95 30.8 31.2 38 40
Garden Route 235 225 99 96 41.9 42.8 16 15
Mykonos 183 162 86 72 47.2 44.5 11 11
The Caledon 177 175 49 54 28.0 30.6 11 10
Blackrock 160 170 54 65 33.6 37.9 12 12
Goldfields 135 133 38 41 28.5 31.0 12 10
Alternative gaming(3)
Galaxy 263 n/a 69 n/a 26.2 n/a 12 n/a
Vukani 362 n/a 169 n/a 46.7 n/a 34 n/a
Other gaming operations 184 195 (141) (154) 13 14
Total gaming operations 9 661 9 134 3 646 3 540 37.7 38.8 641 594
South African hotels division(4) 3 799 3 509 1 470 1 359 38.7 38.7 231 213
Offshore hotels division 565 635 120 108 21.2 17.0 38 35
Pre-foreign exchange gains/(losses) 119 146 21.1 23.0
Foreign exchange gains/(losses) 1 (38)
Corporate(4)(5) (50) (56) 35 42 2 4
Group 13 975 13 222 5 271 5 049 37.7 38.2 912 846
(1) All revenue and income from gaming and hotel operations is derived from external customers.
No one customer contributes more than 10% to the group's total revenue
(2) All casino units are reported pre-internal gaming management fees
(3) Gaming division includes Galaxy and Vukani ("Gameco") with effect from 20 November 2017 - refer note 5
(4) Includes R50 million (2017: R55 million) intergroup management fees
(5) Includes the treasury and management function of the group
DIRECTORS: JA Copelyn (Chairman)*
J Booysen (Chief Executive Officer)
RB Huddy (Chief Financial Officer)
MSI Gani**
MJA Golding**
BA Mabuza (Lead Independent)**
VE Mphande*
JG Ngcobo**
Y Shaik*
(*Non-executive Director **Independent Director)
COMPANY SECRETARY: GD Tyrrell
REGISTERED OFFICE: Palazzo Towers East, Montecasino Boulevard, Fourways, 2055 (Private Bag X200, Bryanston, 2021)
TRANSFER SECRETARIES: Link Market Services South Africa Proprietary Limited,
13th Floor, Rennie House, 19 Ameshoff Street, Braamfontein, 2001 (PO Box 4844, Johannesburg, 2000)
SPONSOR: Deutsche Securities (SA) Proprietary Limited, 3 Exchange Square, 87 Maude Street, Sandton, 2196
(Private Bag X9933, Sandton, 2146)
www.tsogosun.com
Date: 23/05/2018 07:05:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of
the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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