Wrap Text
Vivo Energy plc Interim 2018 Results
Vivo Energy plc
(Incorporated in England and Wales)
(Registration number: 11250655)
(Share code: VVO)
LEI: 213800TR7V9QN896AU56
ISIN: GB00BDGT2M75
Vivo Energy plc Interim 2018 Results
Good momentum and efficient execution in H1 2018
London, United Kingdom, 02 August 2018: Vivo Energy plc today announces its interim condensed
consolidated financial results for the half-year ended 30 June 2018.
Financial Highlights
- Volumes up 4% year-on-year, driven by growth in all business segments
- Gross Cash Profit up 7% year-on-year to $344m
- Non-fuel retail Gross Cash Profit up 22% year-on-year
- Adjusted EBITDA up 8% year-on-year to $204m
- Net Income decreased slightly by 1% year-on-year to $71m
- Adjusted Net Income up 11% year-on-year to $95m
- Adjusted diluted EPS of $0.07 and diluted headline EPS of $0.05 for the first half-year 2018
- Strong balance sheet with net debt/adjusted EBITDA ratio of 1.01x at 30 June 2018
- New $300m multi-currency revolving credit facility remained fully undrawn at the end of the period.
Facility can be increased by an additional $100m contingent upon events after the listing
- Approved interim dividend of circa $0.01 per share, amounting to approximately $8m.
For further information refer to the dividend declaration announcement
KEY PERFORMANCE INDICATORS
Six-month Six-month
period ended period ended
US $ millions, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 4,628 4,462 +4%
Gross Profit 312 295 +6%
Gross Cash Profit 344 323 +7%
Adjusted EBITDA 204 189 +8%
Net Income 71 72 -1%
Adjusted Net Income 95 86 +11%
Strategic and Operational Highlights
- Outstanding HSSE performance, with Total Recordable Case Frequency of zero
- IPO completed May 2018, admitted to trading on the London Stock Exchange with a secondary listing
on the Johannesburg Stock Exchange
- Progressing towards completion of the Engen International Holdings Limited transaction
- On track to open the targeted number of service stations and non-fuel retail outlets for the year
- Joint venture formed to become KFC's licensee in the Ivory Coast. First KFC restaurant in the country
opened at a Shell service station
- Secured several additional aviation contracts with international and regional carriers
Christian Chammas, CEO of Vivo Energy plc, commented: "Following our successful IPO on the London and
Johannesburg Stock Exchanges in May, we are pleased to have delivered a strong set of results for the first half
of the year, during which we continued to meet our growth objectives.
"We have received further regulatory and anti-trust approvals in relation to the Engen International Holdings
Limited transaction. We continue to work on the final outstanding items whilst discussing the timing of
completion with Engen.
"Given Vivo Energy's differentiated business model, track record, exposure to Africa and the growth
opportunity it represents, the Directors remain confident in the resilience of the business and its ability to
deliver its growth objectives in the second half of the year."
FY 2018 Outlook
Overall performance for the first half of the year remained in line with the Group's objectives for the fiscal
year. We continue to expect annual volume growth to be within our target mid-single digit percentage range,
with an overall broadly stable gross cash unit margin.
Following consumer activism in Morocco across several sectors during Q2 2018, the Moroccan government
initiated dialogue with the Moroccan Petroleum Group (GPM), the industry representative body, to discuss
price regulation. Whilst discussions have taken place, at this stage no plans regarding price regulation have
been confirmed.
Vivo Energy expects to provide further updates on its medium-term objectives, reflecting the impact of the
Engen International Holdings Limited transaction, in due course.
Ends
Results Presentation
Vivo Energy plc will host a presentation for analysts and institutional investors today, 02 August 2018 at 09.00
BST, which can be accessed at: https://www.investis-live.com/vivo-energy/5b3e265305eeee1000a8511d/fhud
Conference call details:
Please dial into the call at least 15 minutes prior to the conference start time.
Participant dial-in numbers Replay information
Dial in: +44 20 3936 2999 Dial in: + 44 20 3936 3001
Participant Access Code: 07 36 45 Replay code: 21 71 27
The replay of the webcast will be available after the event at: https://investors.vivoenergy.com
Enquiries:
Media
Tulchan Communications LLP Vivo Energy plc
Martin Robinson, Toby Bates Rob Foyle
+44 20 7353 4200 +44 1234 904 037
vivoenergy@tulchangroup.com rob.foyle@vivoenergy.com
Investors
investors@vivoenergy.com
Notes to editors:*
Vivo Energy operates and markets its products in countries across North, West, East and Southern Africa. The Group
has a network of over 1,800 service stations in 15 countries and exports lubricants to a number of other African countries.
Its retail offering includes fuels, lubricants, card services, shops and other non-fuel services (e.g. oil change and car wash).
It provides fuels, lubricants and liquefied petroleum gas (LPG) to business customers across a range of sectors including
marine, mining, construction, power, transport and manufacturing. Jet fuel is sold to customers under the Vitol Aviation brand.
The Company employs around 2,360 people and has access to approximately 943,000 cubic metres of fuel storage
capacity. The Group's joint venture, Shell and Vivo Lubricants B.V., sources, blends, packages and supplies Shell-branded
lubricants and has blending capacity per annum of around 158,000 metric tonnes at plants in six countries (Ghana, Guinea,
Ivory Coast, Kenya, Morocco and Tunisia).
This announcement is available on the Company's website at: http://investors.vivoenergy.com
This announcement does not constitute an offer to sell or issue, or the solicitation of an offer to buy or acquire securities
of Vivo Energy plc, or any of its affiliates in any jurisdiction, or an inducement to enter into investment activity.
References in this announcement to "Vivo Energy" or the "Group" mean Vivo Energy plc ("the Company") and Vivo
Energy Holding B.V. ("VEH", the holding company of the Vivo Energy Group until admission), together with its
consolidated subsidiaries and subsidiary undertakings. Refer to the Non-GAAP financial measures definitions of Adjusted
EBITDA and Adjusted Net Income and reconciliations to the most comparable IFRS measures in the interim condensed
consolidated financial statements for the six-month period ended 30 June 2018 (note 4). The Group defines Gross Cash
Profit as gross profit adjusted to exclude depreciation and amortisation expense.
* Data correct as at 30 June 2018.
Forward-looking statements
This announcement includes forward-looking statements. These forward-looking statements involve known and unknown risks and
uncertainties, many of which are beyond the Company's control and all of which are based on the Directors' current beliefs and
expectations about future events. Forward-looking statements are sometimes identified by the use of forward-looking terminology
such as: "believe", "expects", "may", "will", "could", "should", "shall", "risk", "intends", "estimates", "aims", "plans", "predicts",
"continues", "assumes", "positioned", "anticipates" or "targets" or the negative thereof, other variations thereon or comparable
terminology. These forward-looking statements include all matters that are not historical facts. They appear in a number of places
throughout this report and include statements regarding the intentions, beliefs or current expectations of the Directors or the Group
concerning, among other things, the future results of operations, financial condition, prospects, growth, strategies of the Group and
the industry in which it operates.
No assurance can be given that such future results will be achieved; actual events or results may differ materially as a result of risks
and uncertainties facing the Group. Such risks and uncertainties could cause actual results to vary materially from the future results
indicated, expressed, or implied in such forward-looking statements.
Such forward-looking statements contained in this report speak only as of the date of this report. The Company and the Directors
expressly disclaim any obligation or undertaking to update these forward-looking statements contained in the document to reflect
any change in their expectations or any change in events, conditions, or circumstances on which such statements are based, unless
required to do so by applicable law.
Vivo Energy plc
5th Floor - The Peak
5 Wilton Road Tel +44 1234 904026
London, SW1V 1AN, United Kingdom www.vivoenergy.com
UNAUDITED INTERIM REPORT
For the six-month period ended 30 June 2018
Terms and abbreviations
Term Description Term Description
B2C Business to consumer GAAP Generally Accepted Accounting Principles
DPO Days payable outstanding HI Six-month period 1 January to 30 June
DSO Days sales outstanding HSSE Health, safety, security and environment
EBIT Earnings before finance expense, finance income IFRS International Financial Reporting Standards
and income taxes IPO Initial public offering
EBITDA Earnings before finance expense, finance income, KFC Kentucky Fried Chicken
income taxes, depreciation and amortisation LIBOR London Interbank Offered Rate
EBT Earnings before income taxes LPG Liquefied petroleum gas
EIHL Engen International Holdings (Mauritius) Limited MD&A Management's discussion and analysis
EPS Earnings per share PP&E Property, plant and equipment
ETR Effective tax rate SVL Shell and Vivo Lubricants B.V.
To view the PDF of the Interim report for the six-month period ended 30 June 2018, please click on the
following link: http://investors.vivoenergy.com/~/media/Files/V/Vivo-Energy-IR/reports-and-
presentations/interim-results-2018-announcement.pdf.
MANAGEMENT'S DISCUSSION AND ANALYSIS
This MD&A of financial condition and results of operations is intended to convey management's
perspective of Vivo Energy plc's ("Vivo Energy" or the "Company") operational performance and financial
condition during the periods under review, as measured under IFRS and other relevant measures. This
MD&A is intended to assist readers in understanding and interpreting the Company's interim condensed
consolidated financial statements and should therefore be read in conjunction with the interim condensed
consolidated financial statements (included from page 17 onwards). The results of operations and cash
flows for the six-month period are not necessarily indicative of the results of operations and cash flows
for the full fiscal year.
The Company was incorporated as a private limited company in the United Kingdom on 12 March 2018
and re-registered as a public limited company on 9 April 2018. Vivo Energy plc was incorporated in
conjunction with the pre-IPO reorganisation of the Group. On 10 May 2018, the Company listed on the
London Stock Exchange Main Market for listed securities and the Main Board of the securities exchange
operated by the Johannesburg Stock Exchange by way of secondary inward listing. References in this
MD&A to "Vivo Energy" or the "Group" or "we" or "our" mean the Company and Vivo Energy Holding
B.V. ("VEH", the holding company of the Vivo Energy Group until admission), together with its
consolidated subsidiaries and subsidiary undertakings. Therefore, the MD&A for the six-month period
ended 30 June 2018 is presented for the Group with continuity, including the impact of the IPO
reorganisation.
All amounts in this report are expressed in thousands of US dollars, unless otherwise indicated.
Further insight into the Company, as well as financial and operations reports, can be found on the investor
relations section of the Company's website at: http://investors.vivoenergy.com/.
IFRS and Non-GAAP measures
This MD&A contains both IFRS and Non-GAAP measures. Non-GAAP measures are defined and
reconciled to the most comparable IFRS measures.
FORWARD-LOOKING STATEMENTS
This report includes forward-looking statements. These forward-looking statements involve known and
unknown risks and uncertainties, many of which are beyond the Group's control and all of which are
based on the Directors' current beliefs and expectations about future events. Forward-looking statements
are sometimes identified by the use of forward-looking terminology such as: "believe", "expects", "may",
"will", "could", "should", "shall", "risk", "intends", "estimates", "aims", "plans", "predicts", "continues",
"assumes", "positioned", "anticipates" or "targets" or the negative thereof, other variations thereon or
comparable terminology. These forward-looking statements include all matters that are not historical
facts. They appear in a number of places throughout this report and include statements regarding the
intentions, beliefs or current expectations of the Directors or the Group concerning, among other things,
the future results of operations, financial condition, prospects, growth, strategies of the Group and the
industry in which it operates.
No assurance can be given that such future results will be achieved; actual events or results may differ
materially as a result of risks and uncertainties facing the Group. Such risks and uncertainties could cause
actual results to vary materially from the future results indicated, expressed, or implied in such forward-
looking statements.
Such forward-looking statements contained in this report speak only as of the date of this report. The
Company and the Directors expressly disclaim any obligation or undertaking to update these forward-
looking statements contained in the document to reflect any change in their expectations or any change
in events, conditions, or circumstances on which such statements are based, unless required to do so by
applicable law.
OVERVIEW
Volumes Gross Gross Cash Adjusted Adjusted Net
(litres) Profit Profit EBITDA Income
4,628 million $312 million $344 million $204 million $95 million
KEY PERFORMANCE INDICATORS
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 4,628 4,462 +4%
Gross profit 312,062 294,935 +6%
Gross cash unit margin ($/'000 litres) 74 72 +3%
Gross cash profit 344,435 323,108 +7%
Adjusted EBITDA 203,550 188,707 +8%
Net income 71,258 72,054 -1%
Adjusted net income 95,037 85,579 +11%
Diluted EPS (US $)(1) 0.05 29.022 N.A.
Adjusted diluted EPS (US $)(1) 0.07 34.93(2) N.A.
KEY HIGHLIGHTS AND EVENTS
Strategic and operational highlights
In the first six months of 2018, Vivo Energy achieved an outstanding HSSE performance, with
industry-led HSSE targets being exceeded for all key performance indicators and with a Total
Recordable Case Frequency of zero.
In May 2018, Vivo Energy successfully completed an initial public offering, and was admitted to
trading on the Main Market of the London Stock Exchange, with a secondary listing on the Main
Board of the securities exchange operated by the Johannesburg Stock Exchange.
Integration planning in relation to the acquisition of EIHL(3) is making good progress. We have
received further regulatory and anti-trust approvals. We continue to work on the final
outstanding items whilst discussing the timing of completion with Engen.
Total volumes increased by 4% year-on-year to 4,628 million litres, driven by further growth in all
business segments.
Continued Retail fuel growth was driven by existing portfolio optimisations and service station
network developments. We are on track to open the targeted number of service stations and non-
fuel retail outlets for the year.
In Non-fuel retail, a joint venture was formed (Baobab Energy Côte d'Ivoire) to become KFC's
licensee in the Ivory Coast. Following this, the first KFC restaurant opened at a Shell service station
in the Ivory Coast.
In Commercial, Vivo Energy successfully secured several additional aviation contracts with
international and regional carriers.
The Lubricants segment delivered a solid performance in terms of volume and adjusted
EBITDA growth, despite an increase in base oil prices compared to H1 2017.
(1) Refer to basis of preparation (note 1) in the interim condensed consolidated financial statements.
(2) Weighted average number of ordinary shares and diluted number of shares for the six-month period ended 30 June 2018 relate to
Vivo Energy plc and for the six-month period ended 30 June 2017 to Vivo Energy Holding B.V.
(3) In December 2017, the Group entered into an agreement to acquire the entire share capital of EIHL, an investment company that
holds the retail and commercial fuel operations of Engen Holdings (Pty) Limited in 10 African countries.
Financial performance
Gross cash profit was up 7% year-on-year, amounting to $344 million, primarily due to
volume growth, higher unit margins and favourable foreign currency movements.
Adjusted EBITDA increased by 8% year-on-year to $204 million, as a result of the volume growth,
strong margins and the contribution to the share of profit from our lubricants joint venture, the SVL group.
Net income of $71 million was slightly below last year (-1%) as a result of the special items, mainly
in relation to the IPO.
Adjusted net income, before the impact of special items mainly associated with IPO-related costs,
increased by 11% to $95 million year-on-year.
Adjusted diluted EPS was $0.07 per share for the first half-year of 2018.
Subsequent to the end of the period, the Board approved an interim dividend of circa $0.01 per
share, amounting to approximately $8 million.
Vivo Energy maintained a strong balance sheet with a leverage ratio(1) of 1.01x at 30 June 2018
(31 December 2017: 0.97x) and a net debt of $395 million at 30 June 2018 (31 December 2017: $366 million).
OUTLOOK
Overall performance for the first half of the year remained in line with the Group's objectives for the
fiscal year. We continue to expect annual volume growth to be within our target mid-single digit
percentage range, with an overall broadly stable gross cash unit margin.
Following consumer activism in Morocco across several sectors during Q2 2018, the Moroccan
government initiated dialogue with the Moroccan Petroleum Group (GPM), the industry representative
body, to discuss price regulation. Whilst discussions have taken place, at this stage no plans regarding
price regulation have been confirmed.
Vivo Energy expects to provide further updates on its medium-term objectives, reflecting the impact of
the EIHL transaction, in due course.
(1) The Group's leverage ratio is calculated as net debt, including lease liabilities, divided by adjusted EBITDA. At 30 June 2018, the
leverage ratio is calculated using the last 12 months' adjusted EBITDA.
CONSOLIDATED RESULTS OF OPERATIONS
SUMMARY INCOME STATEMENT
Six-month period ended
US $'000 30 June 2018 30 June 2017 Change
Revenues 3,672,742 3,226,737 +14%
Cost of sales (3,360,680) (2,931,802) +15%
Gross profit 312,062 294,935 +6%
Selling and marketing cost (90,468) (89,922) +1%
General and administrative cost (102,627) (80,490) +28%
Share of profit of joint ventures and associates 12,144 6,741 +80%
Other income (expense) 1,012 479 +111%
EBIT 132,123 131,743 +0%
Finance expense - net (18,292) (14,753) +24%
EBT 113,831 116,990 -3%
Income taxes (42,573) (44,936) -5%
Net income 71,258 72,054 -1%
NON-GAAP MEASURES
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 4,628 4,462 +4%
Gross cash profit 344,435 323,108 +7%
EBITDA 176,312 171,477 +3%
Adjusted EBITDA 203,550 188,707 +8%
ETR (%) 37.4% 38.4% N.A.
Adjusted net income 95,037 85,579 +11%
Adjusted diluted EPS (US $)(1) 0.07 34.93(2) N.A.
(1) Refer to basis of preparation (note 1) in the interim condensed consolidated financial statements.
(2) Weighted average number of ordinary shares and diluted number of shares for the six-month period ended 30 June 2018 relate to
Vivo Energy plc and for the six-month period ended 30 June 2017 to Vivo Energy Holding B.V.
ANALYSIS OF CONSOLIDATED RESULTS OF OPERATIONS
Volumes
Volumes increased by 4% to 4,628 million litres, resulting from further growth across all business
segments. Retail fuel, our largest segment, accounted for 57% of total volumes and increased
by 5% year-on-year. This strong business performance in Retail was driven by new service
station volumes and continued growth in the existing portfolio. Commercial volumes accounted for 42% of total volumes, an increase
of 2% year-on-year, due to exceptional performance in our sub-segments: Aviation,
Marine and LPG. Lubricants volumes accounted for 1% of total volumes and increased by 3% year-on-year.
Gross cash profit
Gross cash profit increased by $21 million, or 7% to $344 million for the first half-year compared to
$323 million in H1 2017. Gross cash profit was driven by an increase in volumes, higher margins
and favourable foreign currency movements, as well as efficient supply and distribution. Gross
cash unit margin increased by 3% to $74 per thousand litres.
Adjusted EBITDA
Adjusted EBITDA increased by $15 million or 8% year-on-year to $204 million, driven by higher
volumes and margins as well as cost control.
Contributing to the higher Adjusted EBITDA was the share of profit from our joint venture
investments. Share of profit in joint ventures amounted to $12 million, of which $6 million
relates to the share of profit from the SVL group, our lubricants joint venture, of which we acquired
a 50% shareholding in December 2017.
Selling and marketing costs were 1% higher, amounting to $90 million, mainly due to inflation
and foreign currency movements.
General and administrative cost, including special items, amounted to $103 million compared to $80
million in H1 2017. The increase was primarily due to higher non-recurring special items,(1) inflation
and foreign currency movements as well as higher employee benefit expenses in H1 2018.
Net finance expense
Net finance expense increased by $3 million or 24% to $18 million from $15 million in the first
half of 2017. This net finance expense variation was mainly driven by higher long-term borrowings
relative to the same period in 2017, as well as a foreign exchange loss due to currency
movements. In June 2017, the Company entered into a term loan facility. An incremental facility
was drawn down in December 2017 to fund the acquisition of the participation in the SVL
group. The term loan facility carries interest of Libor plus a margin of 2.5% per annum. The
incremental facility has interest of Libor plus a margin of 2.5% for the amortised portion and
Libor plus a margin of 3% for the bullet portion. The Group manages exposure to cash flow
interest rate risk on long-term borrowings using interest rate swaps, resulting in a fixed interest
rate of funding of approximately 4%.
Income taxes
For the six-month period ended 30 June 2018, ETR decreased to 37.4% from 38.4% compared to
the comparative period of 2017. The decrease is mainly attributable to less withholding tax
and higher non-taxable income.
(1) For special items, refer to "Reconciliation of Non-GAAP measures".
OVERVIEW OF OPERATIONS BY SEGMENT
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres)
Retail 2,635 2,514 +5%
Commercial 1,926 1,883 +2%
Lubricants 67 65 +3%
Total 4,628 4,462 +4%
Gross profit
Retail (including Non-fuel retail) 196,538 184,647 +6%
Commercial 80,910 73,447 +10%
Lubricants 34,614 36,841 -6%
Total 312,062 294,935 +6%
Gross cash unit margin ($ /'000 litres)
Retail fuel (excluding Non-fuel retail) 78 77 +2%
Commercial 47 44 +8%
Lubricants 536 583 -8%
Total 74 72 +3%
Gross cash profit
Retail (including Non-fuel retail) 217,064 202,510 +7%
Commercial 91,454 82,623 +11%
Lubricants 35,917 37,975 -5%
Total 344,435 323,108 +7%
Adjusted EBITDA
Retail 120,771 110,937 +9%
Commercial 57,361 54,591 +5%
Lubricants 25,418 23,179 +10%
Total 203,550 188,707 +8%
VOLUMES
(MILLION LITRES)
30 June 2018 30 June 2017
Retail 2 635 2 514
Commercial 1 926 1 883
Lubricants 67 65
4 628 4 462
GROSS CASH PROFIT
($ MILLIONS)
30 June 2018 30 June 2017
Retail 217 202
Commercial 91 83
Lubricants 36 38
344 323
RETAIL
Gross Cash Unit
Volumes Gross Margin Gross Cash Adjusted
(litres) Profit (excl. Non-fuel retail) Profit EBITDA
2,635 million $197 million $78 /'000 litres $217 million $121 million
KEY PERFORMANCE INDICATORS
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 2,635 2,514 +5%
Gross profit (including Non-fuel retail) 196,538 184,647 +6%
Retail fuel gross cash unit margin ($ /'000 litres) 78 77 +2%
Retail fuel gross cash profit 205,638 193,136 +6%
Non-fuel retail gross cash profit 11,426 9,374 +22%
Adjusted EBITDA 120,771 110,937 +9%
ANALYSIS OF RESULTS
The Retail segment continued to drive the strong performance of our business and represented 59%
of the Group's adjusted EBITDA. Volumes grew by 5%, gross cash profit increased by 7% and adjusted
EBITDA was higher by 9% year-on-year.
Retail fuel
Retail fuel is at the heart of our growth story and achieved a 5% increase in volumes.
Higher volumes were fuelled by service station network development, which strongly
contributed to the overall portfolio growth. Continued maximum extraction of value from
existing service stations resulted in the optimisation of the existing portfolio, in line with
our objectives.
The strong performance of our existing portfolio was further supported by marketing and
operational excellence initiatives.
Gross cash unit margin (excluding Non-fuel retail) increased by 2% to $78 per thousand litres.
Related gross cash profit increased by 6% to $206 million, driven by higher volumes, strong margins
and favourable currency movements.
Non-fuel retail
Non-fuel retail gross cash profit increased to $11 million, or 22% year-on-year, driven by new
outlet openings and greater value extraction from existing outlets.
Quick service restaurants are key to growth in this segment and we continue to roll out our
strategy of bringing more food brands to our service stations. During the period, international
food brand, KFC, opened its first restaurant at a Shell-branded service station in the Ivory Coast,
which was well received by our customers.
Convenience retail is an important growth focus area where we deploy category management plans
to respond effectively to consumer needs.
In Non-fuel retail, our focus is delivering the most convenient experience by turning our service
stations into hubs for consumers and commerce.
COMMERCIAL
Volumes Gross Gross Cash Unit Gross Cash Adjusted
(litres) Profit Margin Profit EBITDA
1,926 million $81 million $47 /'000 litres $91 million $57 million
KEY PERFORMANCE INDICATORS
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 1,926 1,883 +2%
Gross profit 80,910 73,447 +10%
Gross cash unit margin ($ /'000 litres) 47 44 +8%
Gross cash profit 91,454 82,623 +11%
Adjusted EBITDA 57,361 54,591 +5%
ANALYSIS OF RESULTS
Aviation, Marine and LPG contributed strongly to higher volumes partly offset by slightly lower
Commercial fuel performance. Gross cash unit margin was higher at $47 per thousand litres compared
to $44 per thousand litres in H1 2017 and gross cash profit increased by 11%.
Core commercial
Core commercial comprises LPG and bulk fuel sales to customers in industries such as
transportation, mining, construction, power and consumers for packed LPG. Core commercial
accounted for 74% (H1 2017: 77%) of total Commercial volumes and 83% (H1 2017: 88%) of
total Commercial gross cash profit.
Gross cash profit was 5% higher, despite a decrease in volumes (1% year-on-year).
Commercial volumes were negatively impacted by lower fuel demand, as some key power sector
customers increasingly relied on hydro power in the rainy season, and certain government construction
projects were delayed. LPG volumes increased year-on-year, driven by the development of the
distributers' networks and the expansion of point of sale coverage.
Gross cash unit margin increased by 6% to $53 per thousand litres, driven by the development of
customer value propositions and strategically targeting profitable growth in high margin sectors.
Cost management, as well as efficient supply and distribution, especially in LPG, further contributed
to higher margins and increased gross cash profit.
Aviation and Marine
Aviation and Marine accounted for 26% (H1 2017: 23%) of total Commercial volumes and
17% (H1 2017: 12%) of total Commercial gross cash profit.
Aviation and Marine volumes grew by 14% year- on-year. Gross cash unit margin increased by 33%
year-on-year to $31 per thousand litres.
Aviation was positively impacted by the tourism sector. Vivo Energy successfully secured several
additional aviation contracts with international and regional carriers. Spot sales and increasing
crude oil prices resulted in higher Aviation unit margins.
Marine volumes increased due to an increase in large-scale tankers bunkering in one of our
countries. In other countries, ongoing efforts to secure opportunistic spot sales at favourable
pricing had a positive impact on both margins and volumes.
LUBRICANTS
Volumes Gross Gross Cash Unit Gross Cash Adjusted
(litres) Profit Margin Profit EBITDA
67 million $35 million $536 /'000 litres $36 million $25 million
KEY PERFORMANCE INDICATORS
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 Change
Volumes (million litres) 67 65 +3%
Revenue 183,665 167,595 +10%
Gross profit 34,614 36,841 -6%
Gross cash unit margin ($ /'000 litres) 536 583 -8%
Gross cash profit 35,917 37,975 -5%
Adjusted EBITDA 25,418 23,179 +10%
ANALYSIS OF RESULTS
Adjusted EBITDA for the Lubricants segment increased by 10% to $25 million, mainly attributable to
our SVL joint venture that ensures a partnership across the value chain. Lubricants accounted for 13%
of the Group's adjusted EBITDA.
Retail lubricants
Retail lubricants comprise sales to Retail customers and B2C sales. Retail lubricants
accounted for 60% (H1 2017: 59%) of total Lubricants volumes and 62% (H1 2017: 61%) of
total Lubricants gross cash profit.
Volumes grew 4% year-on-year driven by successful marketing campaigns and tactical
initiatives such as lube bays and oil specialist offerings at service stations. In the first half of
2018, full growth potential was slightly limited due to lower than expected efficiencies of some of our distributers.
Unit margin decreased to $547 from $598 per thousand litres, as a result of an increase in base oil prices, offset
by favourable foreign exchange movements. In response to the increase in base oil prices, active price management in line
with the pricing strategy was initiated and marketing activities were focused on selling an
optimised sales mix of premium products that ensure higher margins.
Commercial lubricants
Commercial lubricants comprise sales to commercial customers and export sales to more
than 10 African countries. Commercial lubricants accounted for 40% (H1 2017: 41%) of total
Lubricants volumes and 38% (H1 2017: 39%) of total Lubricants gross cash profit.
Volumes grew 1% despite postponement of some construction projects. Activity in the Commercial
lubricants segment is expected to increase during the second part of the year.
Unit margins are at $518 in 2018 from $560 per thousand litres compared to the prior period,
attributable to the increase in the base oil prices, partially offset by favourable foreign exchange
movements.
CONSOLIDATED FINANCIAL POSITION
Total assets
Total assets, including foreign currency movements, increased by $132 million and can largely be explained by:
- $85 million increase in other assets, mainly driven by other government benefits receivable, principally
as a result of the timing of payments;
- $97 million increase in inventories due to higher crude oil prices as well as the timing of purchases
and shipments. Average monthly inventory days for the period was 22 days;
- $57 million increase in trade receivables driven by increased sales volumes and higher crude oil prices.
Average monthly DSO 1 for the period was 16 days.
Partially offset by:
- $107 million decrease in cash and cash equivalents, mainly due to repayments of borrowings,
investments in PP&E and intangible assets as well as current income taxes paid.
TOTAL ASSETS
($ MILLIONS)
30 June 2018 31 December 2017
Non-current assets 1 198 1,204
Current assets 1 563 1,425
2 761 2,629
Equity and liabilities
Total equity and liabilities, including foreign currency ovements, increased by $132 million and can largely
be explained by:
- $194 million increase in trade payables, mostly due to an increase in crude oil prices and the timing of
purchases and shipments. Average monthly DPO(1) for the period was 56 days.
Partially offset by:
- $42 million repayment of long-term debt;
- $23 million decrease in other liabilities, relating to payments of employees' annual and long-term
incentives as well as the settlement of the current portion of the Management Equity Plan.
(1) DPO and DSO are based on monthly averages and on trade elements only.
EQUITY AND LIABILITIES
($ MILLIONS)
30 June 2018 31 December 2017
Current liabilities 1 479 1,352
Non-current liabilities and equity 1 282 1,277
2 761 2,629
LIQUIDITY AND CAPITAL RESOURCES
FREE CASH FLOW
Six-month period ended
US $'000 30 June 2018 30 June 2017
Net income 71,258 72,054
Adjustment for non-cash items & other 82,718 83,741
Cash flow from operations before changes in net working capital and income tax 153,976 155,795
Net change in operating assets and liabilities and other adjustments (35,877) 14,154
Cash flow from operating activities before income tax 118,099 169,949
Net additions of PP&E and intangible assets (59,019) (38,106)
Free cash flow before income tax 59,080 131,843
Current income tax paid (62,438) (72,090)
Free cash flow after tax (3,358) 59,753
Free cash outflow after income tax of $3 million in the first half of 2018 was negatively impacted by special
items(1) and is explained by our significant investments in PP&E and intangible assets of $59 million compared
to $38 million in the first half-year of 2017. We have continued to significantly invest into our retail service
station network, which will positively contribute to our future growth. Further progress was made on our
IT-related projects, such as the SAP implementation, resulting in a cash outflow of approximately
$12 million. Furthermore, we paid income tax in the amount of $62 million in the first half of 2018. Cash
outflows for our investments in fixed assets and income tax paid were offset by a cash inflow from
operating activities before income tax of $118 million due to our strong business performance in H1 2018.
The "Net change in operating assets and liabilities and other adjustments" amounts to a cash outflow of
$36 million, principally as a result of an increase in other assets, which was partly compensated by a
positive net change in our working capital such as inventories, trade receivables and trade payables. The
increase in other assets mainly relates to the timing of payments of other government benefits receivable
for local subsidies. After the end of the reporting period, the Company received cash of $40 million in the
month of July 2018 for the other government benefits receivable.
NET DEBT AND AVAILABLE LIQUIDITY
US $'000 30 June 2018 31 December 2017
Long-term debt 433,943 479,889
Lease liabilities 121,678 133,757
Total debt excluding short-term bank borrowings 555,621 613,646
Short-term bank borrowings 2 154,927 175,302
Less cash and cash equivalents (315,919) (422,494)
Net debt 394,629 366,454
US $'000 30 June 2018 31 December 2017
Cash and cash equivalents 315,919 422,494
Available undrawn credit facilities 1,339,162 761,490
Available short-term capital resources 1,655,081 1,183,984
Net debt at 30 June 2018 increased slightly to $395 million from $366 million at 31 December 2017. The
increase was primarily due to a decrease in cash and cash equivalents, partially offset by a decrease in long-
term debt as a result of scheduled repayments and a decrease in lease liabilities.
(1) For special items, refer to "Reconciliation of Non-GAAP measures".
(2) Short-term bank borrowings exclude the current portion of long-term debt.
The leverage ratio(1) increased to 1.01x at 30 June 2018 from 0.97x at 31 December 2017. In May 2018,
the Company established a new multi-currency revolving credit facility of $300 million.(2) This credit facility
remains fully undrawn and resulted in available short-term capital resources of $1,655 million compared
to $1,184 million at 31 December 2017.
NON-GAAP FINANCIAL MEASURES
We believe that providing certain Non-GAAP financial measures in addition to IFRS measures provides
users of our interim condensed consolidated financial statements with enhanced understanding of results
and related trends, and increases the transparency and clarity of the core results of our business.
Non-GAAP financial measures are derived from the interim condensed consolidated financial statements
but do not have standardised meanings prescribed by IFRS. The exclusion of certain items from Non-
GAAP performance measures does not imply that these items are necessarily non-recurring. From time
to time, we may exclude additional items if we believe doing so would result in a more transparent and
comparable disclosure.
This Interim report is based on reported numbers in accordance with IFRS and the following Non-GAAP
financial measures:
Term Description Term Description
Gross cash Gross profit before depreciation and Gross cash Gross cash profit per unit (1000 litres).
profit amortisation recognised in cost of sales. unit margin
EBIT Earnings before finance expense, finance EBITDA Earnings before finance expense, finance
income and income taxes. income, income tax, depreciation and
amortisation.
Adjusted EBITDA adjusted for the impact of special EBT Earnings before income taxes.
EBITDA items.
Adjusted net Net income adjusted for the impact of Adjusted Diluted EPS adjusted for the impact of
income special items. diluted EPS special items.
Special items Income or charges that are not Free cash Cash flow from operating activities less
considered to represent the underlying flow net additions to PP&E and intangible
operational performance and, based on assets.
their significance in size or nature, are
presented separately to provide further
understanding of the financial
performance of the Group.
Net debt Total borrowings and lease liabilities less Leverage Net debt divided by adjusted EBITDA.
cash and cash equivalents. ratio
(1) The Group's leverage ratio is calculated as net debt, including lease liabilities, divided by adjusted EBITDA. At 30 June 2018, the
leverage ratio is calculated using the last 12 months' adjusted EBITDA.
(2) The multi-currency revolving credit facility consists of a primary $300 million able to be drawn upon admission and an additional
$100 million contingent upon events after the listing.
RECONCILIATION OF NON-GAAP MEASURES
Six-month period ended
US $'000 30 June 2018 30 June 2017
Gross profit 312,062 294,935
Add back: Amortisation and depreciation in cost of sales 32,373 28,173
Gross cash profit 344,435 323,108
Six-month period ended
US $'000 30 June 2018 30 June 2017
EBIT 132,123 131,743
Depreciation and amortisation 44,189 39,734
EBITDA 176,312 171,477
Special items:
Management Equity Plan 2,332 14,318
Restructuring 1,013 2,912
IPO and Engen acquisition related expenses(1) 23,893 -
Adjusted EBITDA 203,550 188,707
Six-month period ended
US $'000 30 June 2018 30 June 2017
Net income 71,258 72,054
Adjustments to EBIT related to special items:
Management Equity Plan 2,332 14,318
Restructuring 1,013 2,912
IPO and Engen acquisition related expenses(1) 23,893 -
Tax on special items (3,459) (3,705)
Adjusted net income 95,037 85,579
Six-month period ended
US $ 30 June 2018 30 June 2017
Diluted EPS(2) 0.05 29.02
Impact of special items 0.02 5.91
Adjusted diluted EPS2 0.07 34.93 3
(1) In May 2018, the Company became listed on the London Stock Exchange Main Market for listed securities and the Main Board of
the JSE Limited by way of secondary inward listing. All IPO-related expenses are considered to be special items. Furthermore, on
4 December 2017, the Company agreed to enter into a sale and purchase agreement with Engen Holdings (Pty) Limited ("Engen
Holdings"), a 100% subsidiary of Engen Limited, in relation to the purchase of shares in Engen International Holdings (Mauritius)
Limited ("Engen International Holdings Limited") for the exchange of a shareholding in Vivo Energy, with a cash element. This
transaction is subject to regulatory approval. Related integration project expenses are treated as special items.
(2) Refer to basis of preparation (note 1) in the interim condensed consolidated financial statements.
(3) Weighted average number of ordinary shares and diluted number of shares for the six-month period ended 30 June 2018 relate
to Vivo Energy plc and for the six-month period ended 30 June 2017 to Vivo Energy Holding B.V.
ACCOUNTING AND REPORTING DEVELOPMENTS
In 2017, the Group elected to early-adopt IFRS 9 "Financial Instruments", IFRS 15 "Revenue from
Contracts with Customers", and IFRS 16 "Leases". The early adoption of IFRS 9 and IFRS 15 had an
insignificant impact on the Group's financial position. The IFRS 16 early adoption had a material impact on
the Consolidated Statement of Financial Position, an immaterial impact on the Consolidated Statement of
Comprehensive Income and no impact on the Consolidated Statement of Cash Flow. The full
retrospective adoption of the standard led to the restatement of comparative figures. Refer to our annual
financial statements as of 31 December 2017. There are no other standards, amendments and
interpretations which are effective for the financial year beginning on 1 January 2018 that have a material
impact on the interim condensed consolidated financial statements of the Group.
CONTROL AND PROCEDURES
Our approach to internal controls includes a number of general and specific processes and policies that
have been developed based on detailed risk assessment at Group and local level. The key controls are
linked to the main business processes such as the revenue and receivables cycle, procure-to-pay cycle,
inventory, capital expenditure management as well as information technology systems. The objectives of
these controls are to ensure structured investment decision making, quality and timely reporting, cost
optimisation as well as intended innovative ways of creating and protecting value.
The internal control framework includes daily, monthly, quarterly, half-yearly and annual monitoring
mechanisms to ensure the control environment continues to be designed and operates effectively. The
internal control function works closely with the internal audit team in carrying out their monitoring role,
which is linked to performance appraisals. There were no significant changes to the internal controls
framework in the reporting period.
RISKS AND UNCERTAINTIES
In December 2015, the Government of Morocco deregulated fuel prices. Following consumer activism in
Morocco across several sectors during Q2 2018, the government initiated discussions with the Moroccan
Petroleum Group (GPM), the industry representative body, to discuss price regulation. Whilst discussions
have taken place, at this stage no plans regarding price regulation have been confirmed. During the first
half of 2018 Retail fuels in Morocco contributed 22% to Group's adjusted EBITDA compared to 29% for
the full-year 2017. Our 2019 guidance at IPO already reflected a $3/'000 litres decrease in overall Retail
gross cash unit margin, representing an estimated impact of approximately $15 million on adjusted
EBITDA, based on 2019 targeted Retail volumes.
Completion of the EIHL transaction is subject to satisfaction (or waiver, where applicable) of certain
conditions, including regulatory anti-trust approvals and non-objection. In the Democratic Republic of
Congo, a Government Ministry on 2 May 2018 filed a motion in the DRC courts asserting a right of pre-
emption in respect of EIHL's shareholding in Engen DRC S.A. (in which the Government holds a 40%
stake) which, if maintained, would have the effect of preventing the transfer of Engen DRC S.A. to the
Group. Engen DRC S.A. constitutes a material part of the EIHL Group. On the advice of counsel, the
Directors believe that this claim has no legal basis. The Company continues to work with the EIHL Group
to resolve this issue prior to the completion of the EIHL transaction. If the Company is unable to resolve
the matter to its satisfaction it may, amongst other things, look to exercise its rights and remedies under
the Share Sale and Purchase Agreement, which, depending on the circumstances, could include exercising
its right to terminate the Share Sale and Purchase Agreement.
Apart from the above, the principal risks and uncertainties faced by the Company are expected to remain
largely consistent with those described in the Vivo Energy plc Prospectus published on 4 May 2018.
SHAREHOLDER INFORMATION
Authorised, issued and outstanding shares as at 30 June 2018 were as follows:
Issued and
Authorised outstanding
Ordinary shares 1,201,798,866 1,201,798,866
Effective 13 June 2018, the Company completed a court-approved reduction of capital. The purpose of
the reduction of capital was to provide distributable reserves which will allow the Company to make
future dividend payments. Following the reduction of capital, the number of issued shares and the rights
attached to those shares remained unchanged. The nominal value of the ordinary shares in the capital of
the Company was reduced by $1.00 from $1.50 to $0.50.
Subsequent to the end of the period, the Board approved an interim dividend of circa $0.01 per share,
amounting to approximately $8 million. The dividend is expected to be paid on 17 September 2018 to
shareholders of record at close of business on 17 August 2018. The dividend will be paid out of
distributable reserves as at 30 June 2018.
UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
For the three- and six-month periods ended 30 June 2018
Terms and abbreviations
Term Description Term Description
DTR Disclosure Guidance and Transparency FVTPL Fair value through profit and loss
Rules GAAP Generally Accepted Accounting Principles
B2B Business to business HSSE Health, safety, security and environment
B2C Business to consumer IAS International Accounting Standards
EBIT Earnings before finance expense, finance IASB International Accounting Standards Board
income and income taxes IFRIC IFRS Interpretation Committee
EBITDA Earnings before finance expense, finance IFRS International Financial Reporting Standards
income, income taxes, depreciation and JSE Johannesburg Stock Exchange
amortisation LTIP Long-term incentive plan
EBT Earnings before income taxes NCI Non-controlling interest
EPS Earnings per share OCI Other comprehensive income
ETR Effective tax rate P&L Profit and loss
FVTOCI Fair value through other comprehensive PP&E Property, plant and equipment
income
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Three-month period ended Six-month period ended
US $'000 Notes 30 June 2018 30 June 2017 30 June 2018 30 June 2017
Revenues 4 1,894,950 1,619,176 3,672,742 3,226,737
Cost of sales (1,736,689) (1,469,741) (3,360,680) (2,931,802)
Gross profit 4 158,261 149,435 312,062 294,935
Selling and marketing cost (46,061) (48,764) (90,468) (89,922)
General and administrative cost (62,135) (48,736) (102,627) (80,490)
Share of profit of joint ventures and associates 6,732 4,045 12,144 6,741
Other income (expense) 5 1,153 180 1,012 479
EBIT 4 57,950 56,160 132,123 131,743
Finance income 1,535 1,403 3,140 2,476
Finance expense (13,365) (8,746) (21,432) (17,229)
Finance expense - net 6 (11,830) (7,343) (18,292) (14,753)
EBT 46,120 48,817 113,831 116,990
Income taxes 7 (18,021) (18,751) (42,573) (44,936)
Net income 4 28,099 30,066 71,258 72,054
Net income attributable to:
Equity holders of Vivo Energy plc(1) 25,198 27,449 64,981 66,387
NCI 2,901 2,617 6,277 5,667
28,099 30,066 71,258 72,054
OCI
Items that may be reclassified to profit or loss
Currency translation differences (40,332) 14,036 (17,383) 20,537
Net investment hedge gain 9,907 - 4,918 -
Items that are never reclassified to profit or loss
Re-measurement of retirement benefits 40 79 73 759
Income tax relating to retirement benefits (2) (79) (2) (290)
OCI, net of tax (30,387) 14,036 (12,394) 21,006
Total comprehensive income (2,288) 44,102 58,864 93,060
Total comprehensive income attributable to:
Equity holders of Vivo Energy plc(1) (1,199) 39,583 53,785 84,710
NCI (1,089) 4,519 5,079 8,350
(2,288) 44,102 58,864 93,060
EPS (US $)(2) 8
Basic 0.02 12.20 0.05 29.51
Diluted 0.02 12.00 0.05 29.02
NON-GAAP FINANCIAL MEASURES(3)
Three-month period ended Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 30 June 2018 30 June 2017
Adjusted EBIT 80,101 73,390 159,361 148,973
EBITDA 79,859 75,756 176,312 171,477
Adjusted EBITDA 102,010 92,986 203,550 188,707
Adjusted net income 46,942 43,591 95,037 85,579
Adjusted diluted EPS(2) (US $) 0.04 17.91 0.07 34.93
The notes are an integral part of these interim condensed consolidated financial statements.
(1) Formerly Vivo Energy Holding B.V. refer to the basis of preparation (note 1).
(2) Refer to the basis of preparation (note 1).
(3) Refer to the Non-GAAP financial measures definitions and reconciliations to the most comparable IFRS measures (note 4).
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
US $'000 Notes 30 June 2018 31 December 2017
Assets
Non-current assets
Property, plant and equipment 579,918 585,171
Right-of-use assets 136,333 148,413
Intangible assets 124,014 119,993
Investments in joint ventures and associates 222,173 218,801
Deferred income taxes 41,545 42,627
Available for sale investments 6,313 6,314
Other assets 9 87,683 82,171
1,197,979 1,203,490
Current assets
Inventories 10 449,802 353,129
Trade receivables 469,509 412,181
Other assets 9 308,746 229,068
Income tax receivables 13,675 8,452
Other financial assets 5,662 -
Cash and cash equivalents 315,919 422,494
1,563,313 1,425,324
Total assets 2,761,292 2,628,814
Equity and liabilities
Total equity
Attributable to equity holders of Vivo Energy plc(1) 461,301 401,546
Attributable to NCI 50,436 46,075
511,737 447,621
Liabilities
Non-current liabilities
Lease liability 100,764 121,261
Borrowings 11 351,402 396,244
Provisions 88,020 91,982
Deferred income taxes 52,816 51,388
Other liabilities 12 176,938 168,245
769,940 829,120
Current liabilities
Lease liability 20,914 12,496
Trade payables 1,062,122 868,521
Borrowings 11 237,468 258,947
Provisions 18,576 20,866
Other financial liabilities - 664
Other liabilities 12 120,432 152,409
Income tax payables 20,103 38,170
1,479,615 1,352,073
Total liabilities 2,249,555 2,181,193
Total equity and liabilities 2,761,292 2,628,814
The notes are an integral part of these interim condensed consolidated financial statements.
(1) Formerly Vivo Energy Holding B.V. refer to the basis of preparation (note 1).
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
US $'000 For the six-month period ended 30 June 2018
Attributable to equity holders of Vivo Energy plc(1)
Other reserves
Currency Fair Equity settled
Share Share Retained Retirement Translation Value incentive NCI Total
Capital Premium Earnings Reserves Benefits Difference Reserves schemes(2) Reserves Total NCI Equity
Balance at 1 January 2018 30 244,753 309,218 - (2,294) (160,226) 2,446 1,904 5,715 401,546 46,075 447,621
Net income - - 64,981 - - - - - - 64,981 6,277 71,258
OCI - - - - 71 (11,267) - - - (11,196) (1,198) (12,394)
Total comprehensive income - - 64,981 - 71 (11,267) - - - 53,785 5,079 58,864
IPO-related reorganisation impact(3) 600,869 (241,618) (364,511) (135,272) 2,248 152,382 (2,446) (1,904) (5,715) 4,033 - 4,033
Share-based expense - - - - - - - 1,937 - 1,937 - 1,937
Dividends paid - - - - - - - - - - (718) (718)
Balance at 30 June 2018 600,899 3,135 9,688 (135,272) 25 (19,111) - 1,937 - 461,301 50,436 511,737
US $'000 For the six-month period ended 30 June 2017
Attributable to equity holders of Vivo Energy Holding B.V.
Other reserves
Currency Fair Equity settled
Share Share Retained Retirement Translation Value incentive NCI Total
Capital Premium Earnings Reserves Benefits Difference Reserves schemes(2) Reserves Total NCI Equity
Balance at 1 January 2017 30 244,753 473,501 - (4,233) (175,396) 2,281 1,814 5,715 548,465 39,993 588,458
Net income - - 66,387 - - - - - - 66,387 5,667 72,054
OCI - - - - 469 17,854 - - - 18,323 2,683 21,006
Total comprehensive income - - 66,387 - 469 17,854 - - - 84,710 8,350 93,060
Share-based expense - - - - - - - 45 - 45 - 45
Dividends paid - - (284,000) - - - - - - (284,000) (3,100) (287,100)
Balance at 30 June 2017 30 244,753 255,888 - (3,764) (157,542) 2,281 1,859 5,715 349,220 45,243 394,463
The notes are an integral part of these interim condensed consolidated financial statements.
(1) Formerly Vivo Energy Holding B.V. refer to the basis of preparation (note 1).
(2) Equity settled incentive schemes include the Long-Term Incentive Plan ('LTIP') and the IPO Share Award Plan.
(3) Refer to the basis of preparation (note 1).
CONSOLIDATED STATEMENT OF CASH FLOWS
Six-month period ended
US $'000 Notes 30 June 2018 30 June 2017
Operating activities
Net income 71,258 72,054
Adjustment for:
Income taxes 42,573 44,936
Amortisation, depreciation and impairment 44,189 39,734
Net gain on disposal of PP&E and intangible assets 5 (829) (888)
Share of profit of joint ventures and associates (12,144) (6,741)
Dividends received from joint ventures and associates 8,929 6,700
Current income tax paid (62,438) (72,090)
Net change in operating assets and liabilities and other adjustments 13 (35,877) 14,154
Cash flows from operating activities 55,661 97,859
Investing activities
Acquisition of businesses (547) -
Purchases of PP&E and intangible assets (60,803) (39,396)
Proceeds from disposals of PP&E and intangible assets 1,784 1,290
Cash flows from investing activities (59,566) (38,106)
Financing activities
Proceeds from issuance of shares 525 -
Net (repayments)/proceeds (of)/from bank and other borrowings (65,864) 223,118
Repayment of lease liability (12,080) (9,273)
Dividends paid (718) (287,100)
Interest paid (21,924) (12,121)
Interest received 3,140 2,475
Cash flows from financing activities (96,921) (82,901)
Effect of exchange rate changes on cash and cash equivalents (5,749) 11,962
Net decrease in cash and cash equivalents (106,575) (11,186)
Cash and cash equivalents at beginning of period 422,494 368,653
Cash and cash equivalents at end of period 315,919 357,467
The notes are an integral part of these interim condensed consolidated financial statements.
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Basis of preparation
Vivo Energy plc ("Vivo Energy" or the "Company") was incorporated as a private limited company in the
United Kingdom on 12 March 2018 and re-registered as a public limited company on 9 April 2018. Vivo
Energy plc was incorporated in conjunction with the pre-IPO reorganisation of the Group. On 10 May
2018 the Company listed on the London Stock Exchange Main Market for listed securities and the Main
Board of the securities exchange operated by the Johannesburg Stock Exchange by way of secondary
inward listing.
References in these interim condensed consolidated financial statements to "Vivo Energy" or the "Group"
mean the Company and Vivo Energy Holding B.V. ("VEH", the holding company of the Vivo Energy Group
until admission), together with its consolidated subsidiaries and subsidiary undertakings. Therefore, the
interim condensed consolidated financial statements for the three- and six-month periods ended 30 June
2018 are presented for the Group with continuity, including the impact of the IPO reorganisation.
Effective 13 June 2018, the Company completed a court-approved reduction of capital. The purpose of
the reduction of capital was to provide distributable reserves which will allow the Company to make
future dividend payments. Following the reduction of capital, the number of issued shares and the rights
attached to those shares remained unchanged. The nominal value of the ordinary shares in the capital of
the Company was reduced by $1.00 from $1.50 to $0.50.
The Company's interim condensed consolidated financial statements have been prepared in accordance
with IAS 34 "Interim Financial Reporting Standards" as adopted by the European Union. The interim
condensed consolidated financial statements have been prepared under the historical cost convention
unless otherwise indicated.
These interim financial statements should be read in conjunction with the annual financial statements for
the year ended 31 December 2017, which have been prepared in accordance with IFRS as adopted by the
European Union.
2. Significant changes in the current and future reporting period
A number of new standards and amendments to standards and interpretations are effective for annual
periods beginning after 1 January 2018.
IFRS 2 "Amendments to Classification and Measurement of Share-based Payment Transactions" clarifies
the following:
- In estimating the fair value of cash-settled share-based payments, the accounting for the effects of
vesting and non-vesting conditions should follow the same approach as for equity-settled share-based
payments;
- Where tax law or regulation require an entity to withhold a specified number of equity instruments
equal to the monetary value of the employees' tax obligation, which is then remitted to the tax
authority, such an arrangement should be classified as equity-settled in its entirety, provided it would
have been classified as equity-settled in absence of the net settlement feature;
- A modification of share-based payment that changes the transaction from cash-settled to equity-
settled should be accounted for as (1) a derecognition of the original liability; (2) recognition of an
equity-settled share-based payment at the modification date; and (3) any differences between the
carrying amount of the liability at the modification date and the amount recognised in equity should
be recognised in profit or loss.
The Group already applies these amendments.
IFRS 10 "Consolidated Financial Statements" and IAS 28 "Amendments to Sale or Contribution of Assets
between an Investor and its Associate or Joint Venture" deals with situations where there is a sale or
contribution of assets between an investor and its associate or joint venture and the treatment of gains
or losses from such transactions. The IASB has not confirmed the effective date of this amendment;
however, early application is permitted. The Group does not anticipate that the application of these
amendments will have an impact on the Group's financial statements in future periods should such
transactions arise.
IFRIC 22 "Foreign Currency Transactions and Advance Consideration" addresses how to determine the
"date of transaction" for the purpose of determining the exchange rate to use on initial recognition of an
asset, expense or income, when consideration for that item has been paid or received in advance in a
foreign currency which resulted in the recognition of a non-monetary asset or non-monetary liability.
The Group already accounts for transactions involving the payment or receipt of advance consideration
in a foreign currency that is consistent with IFRIC 22 amendments.
IFRIC 23 "Uncertainty over Income Tax Treatments" provides additional guidance on the determination
of taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates, when there is
uncertainty over income tax treatments under IAS 12. The Group has to determine the impact, if any, on
the interim condensed consolidated financial statements.
The Group does not anticipate that the application of these amendments will have an impact on the
Group's interim condensed consolidated financial statements.
There are no IFRS or IFRIC interpretations that are not yet effective that would be expected to have a
material impact on the Group.
3. Financial instruments by category
The table below sets out the Group's classification of each class of financial assets and financial liabilities
and their fair values for the current and the comparative period:
US $'000 30 June 2018
Financial Financial Financial Total
assets at assets at assets at carrying
amortised cost FVTPL FVTOCI value Fair value
Financial assets
Trade receivables 469,509 - - 469,509 469,509
Cash and cash equivalents 315,919 - - 315,919 315,919
Available for sale investments - - 6,313 6,313 6,313
Other assets(1) 92,419 - - 92,419 92,419
Total 877,847 - 6,313 884,160 884,160
(1) Other assets (note 9) exclude the following elements that do not qualify as financial instruments: prepayments, VAT and duties
receivable and other government benefits receivable.
US $'000 30 June 2018
Financial Total
liabilities at carrying
amortised cost value Fair value
Financial liabilities
Trade payables 1,062,122 1,062,122 1,062,122
Borrowings 588,870 588,870 588,870
Other liabilities(1) 232,580 232,580 232,580
Lease liabilities 121,678 121,678 121,678
Total 2,005,250 2,005,250 2,005,250
US $'000 31 December 2017
Financial Financial Financial Total
assets at assets at assets at carrying
amortised cost FVTPL FVTOCI value Fair value
Financial assets
Trade receivables 412,181 - - 412,181 412,181
Cash and cash equivalents 422,494 - - 422,494 422,494
Available for sale investments - - 6,314 6,314 6,314
Other assets(2) 87,473 - - 87,473 87,473
Total 922,148 - 6,314 928,462 928,462
US $'000 31 December 2017
Financial Total
liabilities at carrying
amortised cost value Fair value
Financial liabilities
Trade payables 868,521 868,521 868,521
Borrowings 655,191 655,191 655,191
Other liabilities(24) 261,179 261,179 261,179
Lease liabilities 133,757 133,757 133,757
Other financial liabilities 664 664 664
Total 1,919,312 1,919,312 1,919,312
The Group has classified equity investments as financial instruments at FVTOCI (without recycling). These
investments are measured using inputs for the asset or liability that are in the absence of observable
market data, based on net asset value of the related investments (level 3 in the IFRS 13 fair value
measurement hierarchy). Since the value is based on the net asset value of the related investments, no
sensitivity analysis is presented.
(1) Other liabilities (note 12) exclude the following elements that do not qualify as financial instruments: other tax payable
and deferred income.
(2) Other assets (note 9) exclude the following elements that do not qualify as financial instruments: prepayments, VAT and duties
receivable and other government benefits receivable.
4. Segment reporting
The Group operates under three reportable segments: Retail, Commercial and Lubricants.
Retail segment - Retail fuel is aggregated with Non-fuel revenue. Both the operating segments derive
revenue from retail customers who visit our retail sites. Retail fuel and Non-fuel revenues are aggregated
as the segments are managed as one unit and have similar customers. The economic indicators that have
been addressed in determining that the aggregated segments have similar economic characteristics are
that they have similar expected future financial performance and similar operating and competitive risks.
Commercial segment - Commercial fuel, LPG, Aviation and Marine are aggregated in the Commercial
segment as the operating segments derive revenues from commercial customers. The segments have
similar economic characteristics. The economic indicators that have been addressed are the long-term
growth and average long-term gross margin percentage.
Lubricants segment - Retail, B2C, B2B and Export Lubricants are the remaining operating segments.
Since these operating segments meet the majority of aggregation criteria, they are aggregated in the
Lubricants segment.
The segmented information is prepared using the same accounting policies as those described in the annual
consolidated financial statements for the fiscal year ended 31 December 2017.
The following table presents revenues and profit information regarding the Group's operating segments:
US $'000 Six-month period ended 30 June 2018
Retail Commercial Lubricants Consolidated
Revenues from external customers 2,389,615 1,099,462 183,665 3,672,742
Gross profit 196,538 80,910 34,614 312,062
Add back: Depreciation and amortisation 20,526 10,544 1,303 32,373
Gross cash profit 217,064 91,454 35,917 344,435
Adjusted EBITDA 120,771 57,361 25,418 203,550
US $'000 Six-month period ended 30 June 2017
Retail Commercial Lubricants Consolidated
Revenues from external customers 2,071,564 987,578 167,595 3,226,737
Gross profit 184,647 73,447 36,841 294,935
Add back: Depreciation and amortisation 17,863 9,176 1,134 28,173
Gross cash profit 202,510 82,623 37,975 323,108
Adjusted EBITDA 110,937 54,591 23,179 188,707
Six-month period ended
US $'000 30 June 2018 30 June 2017
Share of profit of joint ventures and associates included in segment EBITDA
Lubricants 5,706 -
Retail 2,721 3,961
Commercial 3,717 2,780
Total 12,144 6,741
The amount of revenues from external customers by location of the customers is shown in the table below.
Six-month period ended
US $'000 30 June 2018 30 June 2017
Revenues from external customers by country
Morocco 755,249 630,423
Kenya 635,018 668,828
Ghana 293,742 261,609
Other 1,988,733 1,665,877
Total 3,672,742 3,226,737
US $'000 30 June 2018 31 December 2017
Non-current assets by country (excluding deferred tax)
Netherlands 195,727 182,459
Morocco 187,652 189,058
Kenya 122,198 125,184
Other 650,857 664,162
Total 1,156,434 1,160,863
Reconciliation of Non-GAAP measures
We believe that including certain Non-GAAP financial measures in addition to IFRS measures provides
users of our interim condensed consolidated financial statements with enhanced understanding of results
and related trends and increases the transparency and clarity of the core results of our business. Non-
GAAP financial measures are derived from the interim condensed consolidated financial statements but
do not have standardised meanings prescribed by IFRS. The exclusion of certain items from Non-GAAP
performance measures does not imply that these items are necessarily non-recurring. From time to time,
we may exclude additional items if we believe doing so would result in a more transparent and comparable disclosure.
Gross cash profit, the Group defines Gross cash profit as gross profit before depreciation and
amortisation expense. Adjusted EBITDA, the Group defines EBITDA as earnings before tax, finance
expense, finance income, depreciation and amortisation. Adjusted EBITDA is arrived at by making further
adjustments to EBITDA for special items. Special items represent income or charges that are not
considered to represent the underlying operational performance and, based on their significance in size
or nature, are presented separately to provide further understanding of the financial performance of the
Group. Headline earnings, the Group defines Headline earnings as earnings based on net income
attributable to owners of the Group, before items of a capital nature, net of income tax.
Six-month period ended
US $'000 30 June 2018 30 June 2017
EBIT 132,123 131,743
Depreciation and amortisation 44,189 39,734
EBITDA 176,312 171,477
Special items:
Management Equity Plan 2,332 14,318
Restructuring 1,013 2,912
IPO and Engen acquisition related expenses(1) 23,893 -
Adjusted EBITDA 203,550 188,707
Six-month period ended
US $'000 30 June 2018 30 June 2017
Net income 71,258 72,054
Adjustments to EBIT related to special items:
Management Equity Plan 2,332 14,318
Restructuring 1,013 2,912
IPO and Engen acquisition related expenses(1) 23,893 -
Tax on special items (3,459) (3,705)
Adjusted net income 95,037 85,579
Six-month period ended
US $ 30 June 2018 30 June 2017
Diluted EPS (see note 8) 0.05 29.02
Impact of special items 0.02 5.91
Adjusted diluted EPS(2) 0.07 34.93
Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017
Headline Earnings Per Share
Net income attributable to owners 64,981 66,387
Re-measurements:
Net gain on disposal of PP&E and intangible assets (829) (888)
Income tax on re-measurements 241 271
Headline earnings 64,393 65,770
Weighted average number of ordinary shares(3) 1,201,798,866 2,250,000
Headline EPS (US $)(2) 0.05 29.23
Diluted number of shares(3) 1,204,209,416 2,287,433
Diluted headline EPS (US $)(2) 0.05 28.75
ETR 37.40% 38.41%
(1) In May 2018, the Company became listed on the London Stock Exchange Main Market for listed securities and the Main Board of
the JSE Limited by way of secondary inward listing. All IPO-related expenses are considered to be special items. Furthermore, on
4 December 2017, the Company agreed to enter into a sale and purchase agreement with Engen Holdings (Pty) Limited ("Engen
Holdings"), a 100% subsidiary of Engen Limited, in relation to the purchase of shares in Engen International Holdings (Mauritius)
Limited ("Engen International Holdings Limited") for the exchange of a shareholding in Vivo Energy, with a cash element. This
transaction is subject to regulatory approval. Related integration project expenses are treated as special items.
(2) Refer to the basis of preparation (note 1).
(3) Weighted average number of ordinary shares and diluted number of shares for the six-month period ended 30 June 2018 relate
to Vivo Energy plc and for the six-month period ended 30 June 2017 to Vivo Energy Holding B.V.
5. Other income and expense
Six-month period ended
US $'000 30 June 2018 30 June 2017
Gain on disposals of property, plant and equipment and intangible assets 829 888
Loss on financial instruments (322) (2,094)
Other income 505 1,685
1,012 479
6. Finance income and expense
Six-month period ended
US $'000 30 June 2018 30 June 2017
Finance expense
Interest on bank and other borrowings and on lease liability (11,117) (10,424)
Interest on long-term debt including amortisation of set-up fees (5,956) (4,374)
Foreign exchange loss (2,014) (199)
Accretion expense net defined benefit liability (1,053) (1,048)
Other (1,292) (1,184)
(21,432) (17,229)
Finance income
Interest from cash and cash equivalents 3,140 2,476
3,140 2,476
Finance expense - net (18,292) (14,753)
7. Income taxes
Income tax expense is recognised based on management's estimate of the annual effective income tax rate
of 37.4% for the six-month period ended 30 June 2018 (38.4% for the six-month period ended 30 June
2017). The effective tax rate used for the six-month period ended 30 June 2018 is in line with
management's estimated annual income tax rate for the year, as no significant items impacting the effective
annual income tax rate have been identified.
8. Earnings per share
Basic and diluted EPS were computed as follows:
Three-month period ended Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 30 June 2018 30 June 2017
Basic Earnings Per Share
Net income 28,099 30,066 71,258 72,054
Attributable to owners 25,198 27,449 64,981 66,387
Weighted average number of ordinary shares(1) 1,201,798,866 2,250,000 1,201,798,866 2,250,000
Basic EPS (US $)(2) 0.02 12.20 0.05 29.51
Three-month period ended Six-month period ended
US $'000, unless otherwise indicated 30 June 2018 30 June 2017 30 June 2018 30 June 2017
Diluted Earnings Per Share
Earnings attributable to owners 25,198 27,449 64,981 66,387
Diluted number of shares(1) 1,204,209,416 2,287,433 1,204,209,416 2,287,433
Diluted EPS (US $)(2) 0.02 12.00 0.05 29.02
9. Other assets
US $'000 30 June 2018 31 December 2017
Other government benefits receivable(3) 140,502 71,748
Prepayments 133,265 118,507
VAT and duties receivable 30,243 33,511
Employee loans 8,613 8,137
Indemnification asset on legal and tax claims 7,726 9,868
Other(4) 76,080 69,468
396,429 311,239
Of which current 308,746 229,068
Of which non-current 87,683 82,171
396,429 311,239
10. Inventories
US $'000 30 June 2018 31 December 2017
Fuel 372,813 276,680
Lubricants 70,034 69,773
Other 6,955 6,676
449,802 353,129
Cost of sales as disclosed on the face of the Consolidated Statement of Comprehensive Income include
the total expense for inventory during the half-year period for $3,157m (full-year 2017: $5,869m). The
carrying value of inventory represents the net realisable value.
Write-downs of inventories to the net realisable value amounted to $5m as per 30 June 2018 (2017: $5m).
This was recognised as an expense during the period and included in cost of sales.
(1) Weighted average number of ordinary shares and diluted number of shares for the six-month period ended 30 June 2018 relate
to Vivo Energy plc and for the six-month period ended 30 June 2017 to Vivo Energy Holding B.V.
(2) Refer to the basis of preparation (note 1).
(3) The amount relates to other government benefits receivable mainly in Morocco, Botswana, Madagascar, Senegal and Guinea.
(4) The amount in "Other" mainly comprises items such as brand promotion fund receivables and coupons to customers' deposits.
11. Borrowings
US $'000 Drawn on Interest rate Maturity 30 June 2018 31 December 2017
Societe Generale(1) 09/06/2017 Libor + 2.50%/3% 09/06/2022 433,943 479,889
Bank borrowings 154,927 175,302
588,870 655,191
Of which current 237,468 258,947
Of which non-current 351,402 396,244
588,870 655,191
(1) The amounts are net of financing costs. The loan amount is $438m (2017: $484m); financing costs are $4m (2017: $4m).
Current borrowings consist of bank borrowings which carry interest rates between 1% and 22% per annum.
The carrying amounts of the Group's non-current and current borrowings approximate the fair value.
The Societe Generale term loan facility was entered into on 6 June 2017. The facility matures on 9 June
2022 and has semi-annual repayments. Interest is paid quarterly at a rate of Libor plus a margin of 2.50%
per annum. Incremental facility was drawn down on 18 December 2017 and carries an interest of Libor
+2.5% for the amortised portion and Libor +3% for the bullet portion.
Key covenants:
- The Company needs to supply to the lender within 150 calendar days after year-end its audited annual
consolidated financial statements, unaudited annual non-consolidated financial statements and the
unaudited annual group accounts of each operating unit. Within 90 days after each half of each financial
year, the Company should provide its unaudited non-consolidated financial statements, unaudited
consolidated financial statements and unaudited group accounts for each operating unit for the
financial half-year.
- With each set of financial statements, a financial covenants compliance certificate has to be provided
showing the debt cover and interest cover.
- The loan carries some customary negative pledges such as on asset sale, securities over assets,
mergers and guarantees subject in each case to some exemptions and permitted baskets. It also has
a Change of Control clause triggering repayment if a shareholder, other than permitted ones, takes
control of the Company.
No covenants were breached in the last applicable period.
12. Other liabilities
US $'000 30 June 2018 31 December 2017
Oil fund liabilities 86,519 88,070
Deposits owed to customers 69,039 54,062
Employee liabilities 60,320 93,801
Other tax payable 59,529 50,587
Deferred income 5,261 8,888
Contingent liabilities 3,825 3,825
Other 12,877 21,421
297,370 320,654
Of which current 120,432 152,409
Of which non-current 176,938 168,245
297,370 320,654
13. Net change in operating assets and liabilities and other adjustments
Six-month period ended
US $'000 30 June 2018 30 June 2017
Inventories (105,305) (15,080)
Trade receivables (70,301) (92,929)
Trade payables 215,123 141,003
Other assets (80,463) (42,163)
Other liabilities (16,538) 8,495
Provisions (3,897) 11,986
Other 25,504 2,842
(35,877) 14,154
14. Commitments and contingencies
Lease commitments
The table below analyses the Group's lease liabilities into relevant maturity groups based on the remaining
period at the reporting date to the contractual maturity date. The amounts disclosed in the table are the
contractual undiscounted cash flows.
US $'000 30 June 2018
Between 3
Less than 3 months and 1 Between 1 Between 2 Over
months year and 2 years and 5 years 5 years Total
Lease liability 4,807 16,166 17,225 48,953 47,067 134,218
31 December 2017
Between 3
Less than 3 months and 1 Between 1 Between 2 Over
months year and 2 years and 5 years 5 years Total
Lease liability 4,846 14,540 17,217 49,906 55,712 142,221
Contingencies
Management has prepared a best estimate of its contingent liabilities that should be recognised in respect
of legal claims in the course of ordinary business. Some of the claims will be compensated by an indemnity
obtained from the former Shareholder (Shell). Should these cases be determined against the relevant Vivo
Energy Entity, such entity will be indemnified by the former Shareholder. An indemnification asset of $8m
(2017: $10m), equivalent to the fair value of the contingencies provided for by the Group in respect of
the indemnified claims that have been recognised.
In many markets there is a high degree of complexity involved in the local tax regimes. In common with
other business operating in this environment the Group is required to exercise judgement in the
assessment of any potential exposures in these areas. Where appropriate, the Group will make provisions
or disclose contingencies in accordance with the relevant accounting principles.
15. Management Equity Plan
In 2013, Vivo Energy Holding granted to certain senior managers and other senior employees phantom
options which entitled option holders to a cash payment based on the value of Vivo Energy Holding shares
upon exercise of their phantom options. Under the terms of the phantom options, all outstanding
phantom options would become fully exercisable upon admission.
However, the option holders have agreed to amend the terms of their outstanding phantom options such
that 30% of the outstanding phantom options became deemed to be exercised at admission and 70% will
become exercisable on the first anniversary of admission for a period of 12 months. Under the amended
terms, the option holders' entitlement to the cash payment is based on the market value of the shares at
the time of exercise net of a nominal per share exercise price.
The Management Equity Plan related liability as at 30 June 2018 amounted to $34m (31 December 2017: $49m).
16. Events after balance sheet period
Subsequent to the end of the period, the Board approved an interim dividend of circa $0.01 per share,
amounting to approximately $8 million. The dividend is expected to be paid on 17 September 2018 to
shareholders of record at close of business on 17 August 2018. The dividend will be paid out of
distributable reserves as at 30 June 2018.
RESPONSIBILITY STATEMENT
The Directors confirm that these interim condensed consolidated financial statements have been prepared
in accordance with the IAS 34, "Interim Financial Reporting", as adopted by the European Union and that
the interim management report includes a fair review of the information required by DTR 4.2.7 and DTR
4.2.8, namely:
- An indication of important events that have occurred during the first six months and their impact
on the condensed set of financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year;
- Material related party transactions that have taken place in the first six months of the current
financial year and that have materially affected the financial position or performance of the entity
during that period; and any changes in the related party transactions described in the last annual
report that could do so.
The Directors of Vivo Energy plc are listed on page 50 of the Vivo Energy plc Prospectus dated 4 May
2018; there are no changes in the period. A list of current directors is maintained on the Vivo Energy plc
website: http://investors.vivoenergy.com/group-overview/board-of-directors.
By order of the Board
Christian Chammas
Chief Executive Officer
2 August 2018
Johan Depraetere
Chief Financial Officer
2 August 2018
INDEPENDENT REVIEW REPORT
Report on the interim condensed consolidated financial statements
Our conclusion
We have reviewed Vivo Energy plc's interim condensed consolidated financial statements (the "interim
financial statements") in the Interim Report of Vivo Energy plc for the 6-month period and 3-month period
ended 30 June 2018. Based on our review, nothing has come to our attention that causes us to believe
that the interim financial statements are not prepared, in all material respects, in accordance with
International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union
and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority.
What we have reviewed
The interim financial statements comprise:
- the consolidated statement of financial position as at 30 June 2018;
- the consolidated statement of comprehensive income for the 6-month and 3-month periods then ended;
- the consolidated statement of cash flows for the period then ended;
- the consolidated statement of changes in equity for the period then ended; and
- the explanatory notes to the interim financial statements.
The interim financial statements included in the Interim Report have been prepared in accordance with
International Accounting Standard 34, 'Interim Financial Reporting', as adopted by the European Union
and the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority.
As disclosed in note 1 to the interim financial statements, the financial reporting framework that has been
applied in the preparation of the full annual financial statements of the Group is applicable law and
International Financial Reporting Standards (IFRSs) as adopted by the European Union.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the directors
The Interim Report, including the interim financial statements, is the responsibility of, and has been
approved by, the directors. The directors are responsible for preparing the Interim Report in accordance
with the Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's Financial
Conduct Authority.
Our responsibility is to express a conclusion on the interim financial statements in the Interim Report
based on our review. This report, including the conclusion, has been prepared for and only for the
company for the purpose of complying with the Disclosure Guidance and Transparency Rules sourcebook
of the United Kingdom's Financial Conduct Authority and for no other purpose. We do not, in giving this
conclusion, accept or assume responsibility for any other purpose or to any other person to whom this
report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.
What a review of interim financial statements involves
We conducted our review in accordance with International Standard on Review Engagements (UK and
Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the
Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures.
A review is substantially less in scope than an audit conducted in accordance with International Standards
on Auditing (UK) and, consequently, does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
We have read the other information contained in the Interim Report and considered whether it contains
any apparent misstatements or material inconsistencies with the information in the interim financial
statements.
PricewaterhouseCoopers LLP
Chartered Accountants
London
2 August 2018
JSE sponsor: J.P. Morgan Equities South Africa (Pty) Ltd
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