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EFORA ENERGY LIMITED - Provisional Condensed Results for the year ended 28 February 2019

Release Date: 03/06/2019 07:05
Code(s): EEL     PDF:  
 
Wrap Text
Provisional Condensed Results
for the year ended 28 February 2019

EFORA ENERGY LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1993/000460/06)
JSE share code: EEL
ISIN: ZAE000248258
("Efora" or "the Company" or together with its subsidiaries and joint venture "the Group")


PROVISIONAL CONDENSED RESULTS 
for the year ended 28 February 2019
                                                                 
                                                                 
SALIENT FEATURES
-  Revenue of R2.6 billion (2018: R2.6 billion for 9 months post acquisition of Afric Oil), 
   average monthly sales down by 26%
-  R367.1 million raised by way of a right issue
-  Settlement of loan from Gemcorp of R187.7 million
-  Loss after tax of R579.9 million (2018: R175.9 million), up 225%, impacted primarily by:
   -  Impairment of Lagia oil and gas properties and intangible assets by R152.2 million;
   -  Block III net write-off of R95.0 million of the contingent consideration offset by the gains 
      on de-recognition of the deferred tax and cost carry liabilities;
   -  Impairments of R66.1 million of the loan receivable from EERNL and R23.2 million pertaining 
      to the Transcorp refund;
   -  Impairments totalling R143.5 million attributable to the Afric Oil intangible assets; and
   -  Inventory loss of R10.5 million.
-  Decrease of 21% in recurring cost base
-  Award of two year crude trading contract by NNPC in Nigeria, one lifting during the year
-  Strategic review of Lagia asset
-  Extension of Block III license by 6 months 

Damain Matroos, Interim Chief Executive Officer of Efora commented: 
"These results are disappointing due to the below par performance at Afric Oil that was impacted by 
several challenges, some of which were beyond our control. Unexpected external factors also 
negatively impacted our other non-operating assets. 

The results are not a reflection of the efforts that have gone into moving the Group forward. 
The coming months are absolutely critical and we remain focussed on initiatives to drive sales 
volumes growth and cost containment in order to improve the performance of the business to the 
levels expected at the time of its acquisition. We are confident that these initiatives will bear 
fruit in the coming months."

PERFORMANCE REVIEW
Whilst the Group's upstream assets benefited from the general improvement in oil prices during the 
year, this presented significant challenges for the South African market which experienced several 
price increases in the second half of the year. This resulted in working capital constraints that 
negatively affected volumes from our key business, Afric Oil. Increased competition from heavy 
discounting by small entrants into the market, low-cost importers, illegal importation of fuel 
products and the currency crisis which resulted in the temporary suspension of our Zimbabwe 
operations, further exacerbated the impact on the Group margins. Average monthly volumes from the 
Afric Oil business therefore decreased by 26% as the results of the business were included for 
9 months post acquisition in the prior year. In this regard, total revenue remained relatively 
unchanged at R2.6 billion.

Initiatives are in place to improve the volumes at Afric Oil, however in its impairment assessments 
of the business as at 28 February 2019, the Group recognised impairments totalling R143.5 million 
attributable to goodwill, brands and customer relationships intangibles that arose on acquisition, 
which were adversely affected by lower than expected performance of the business which impacted 
future estimated cash flow projections especially at the Forever Fuels division which lost a 
number of customers. For more details on these impairments, see note 5.2.

The shift in focus to downstream operations meant that the Group's limited capital was deployed to 
the Afric Oil operations as a trade off to the further development of the Lagia oil field. This was 
a decision the Board had to make whilst it sought strategic partnership for its Lagia asset, 
a process which has not yielded the desired outcome. The intermittent suspension of the Lagia 
development programme, amongst other matters, had a negative impact on the valuation of the 
Lagia oil field as reflected in the Competent Persons Report completed as at 1 February 2019 which 
resulted in an impairment of R152.2 million of the Lagia oil and gas and intangible assets. 
Note 5.1 provides more details on the impairment of the Lagia assets.

Total E&P RDC ("Total"), our former partner, decided not to continue as part of the Block III 
consortium. As previously reported, with the expectation of further development of Block III, 
the Group had recognised a contingent consideration and deferred tax and cost carry liabilities 
relating to its farm in agreement with Total. Total's exit from Block III resulted in a net 
write-off of R95.0 million of the contingent consideration offset by the gains on de-recognition 
of the referred liabilities. The impact of Total's exit on the results of the Group is further 
highlighted in notes 6 and 12.

Under very unfortunate circumstances, the Group learnt in February 2019 of the liquidation of 
Energy Equity Resources Norway Limited which owes the Group R70.0 million (US$5 million). 
In accordance with our accounting policy which recognises this receivable as credit impaired, 
the Group has fully provided for the amount pending the outcome of the liquidation process as 
indicated in note 6. This resulted in a charge of R66.1 million under other operating costs.

In its interim results for the six months ended 31 August 2018, the Group reported on the loss of 
inventory totalling R10.5 million at its Boland subsidiary. Whilst a forensic investigation has 
now been completed the results are inconclusive and management is evaluating further interrogation 
of the occurrence. This loss is included under other operating costs.

The impact of the Group's cost optimisation initiatives is not immediately visible on the Group's 
statement of comprehensive income, however excluding the impact of the developments noted above 
and other less material once-off items, the Group's recurring costs decreased by R35.3 million 
(excluding depreciation and amortisation) arising primarily from a reduction in business development, 
consulting, legal, listing and general overheads.

Excluding the impact of the de-recognition of the Total cost carry liability, the Group's other 
income streams increased by R20.0 million as a result of a gain of acquisition of property and 
throughput income, primarily. 

Whilst finance income has increased by R15.1 million, this is mainly imputed interest on the 
Group's financial assets. Finance costs have decreased by R7.5 million following the settlement 
of the loans owed to Gemcorp and Turquoise Moon.

The Group is therefore reporting a loss after tax of R579.9 million (2018: R175.9 million) for 
the year ended 28 February 2019, a loss per share of 69.91 cents (2018: 42.34 cents) and a 
headline loss per share of 45.31 cents (2018: 42.20 cents).

OPERATIONAL REVIEW 
Afric Oil, South Africa and Zimbabwe
The challenges already highlighted resulted in a decrease in volumes to 203.7 million litres 
(17.0 million litres per month) relative to 222.3 million litres (24.7 million litres per month) 
for the nine months post-acquisition in the prior comparative period. The loan of R124.0 million 
advanced to Afric Oil in September and October 2018, together with other working capital 
facilities totalling R40 million from third parties did result in an increase in volumes albeit 
in the latter part of the year. 

We continue to streamline the business in order to ensure that we remain competitive. During the 
year we reduced our fleet and terminated third-party transportation arrangements with a primary 
focus of optimising our internal logistics function. We are pleased to have signed on two large 
customers during the year and we remain excited about ongoing engagement with prospective customers, 
which we hope will be finalised soon.

Looking ahead, we have a few key priorities:
-  improving our BBBEE rating in order to attract new business;
-  finalising the strategic interventions for our Zimbabwean operations;
-  implementing a sales strategy to drive growth and business retention; and
-  adding working capital facilities to ensure the Group's growth plan is adequately funded.

Lagia, Egypt
Volumes from Lagia decreased from 21 152 barrels in the prior comparative period to 15 371 barrels 
for the year, a decrease of 27%, as operations were kept on cold flow. In the Group's interim 
results for the six months ended 31 August 2018, following a strategic review, part of Lagia's 
assets were classified as held for sale as a plan was in place to dispose of part of the asset. 
Offers received from prospective buyers were highly unfavourable which has led the Board to the 
decision to retain full ownership of the asset whilst it investigates further strategic options 
pertaining to the asset. As such, the Group no longer holds assets classified as held for sale.

Crude trading, Nigeria
Constraints on the availability of crude oil from the NNPC continued, which resulted in only one 
lifting of 950 000 barrels during the year. Our joint venture therefore reported a profit of 
R1.1 million (2018: R1.8 million). We are confident of securing additional cargos during the 
remaining period of the contract.

Block III, DRC
The Block III licence was extended to July 2019, during which time the remaining partners will 
carry out a review of the technical data to determine the area that will be the subject of the 
renewal of the licence.

Total E&P RDC, which previously held 66.7% of the working interest in Block III, has indicated 
that it will no longer continue as part of the consortium to further explore Block III. 
Consequently, Efora will be required to pay its working interest share of forward costs associated 
with Block III. In addition, Efora now has the option to increase its working interest in Block III 
to 42.5% and is currently evaluating whether it will take up this option.

We remain confident that this block remains an exciting prospect for the Group with an unaudited 
recoverable resource estimate of 1,213 MMbbl (best estimate). We will undertake an assessment of 
the prospects as part of the process to obtain an extension of the licence after July 2019.

GOING CONCERN 
The Board has performed an assessment of the Group's operations relative to available cash 
resources and is confident that the Group is able to continue operating for the next 12 months. 
The Board remains reasonably confident that it will manage the uncertainties that exist which are 
highlighted in note 18 to the condensed provisional consolidated reviewed financial statements. 
The condensed provisional consolidated reviewed financial statements presented have therefore been 
prepared on a going concern basis.

LITIGATION UPDATE 
Shareholders are referred to the SENS announcement dated 5 April 2019 which is available on the 
Company's website wherein updates were provided on the status of the Group's claims against 
Robin Vela and Transcorp.

On 29 May 2019, judgement was issued wherein the Company's claim against Encha Group Limited was 
dismissed. The Company was ordered to pay the costs of the arbitration as well as the costs 
incurred by the defendant. These costs are still to be quantified. We are studying the judgment 
with our legal counsel to determine the details of thereof. We will assess the prospects and 
basis for an appeal relating to the unexpected outcome.

OUTLOOK 
Our key focus for the next few months is on achieving a material increase in sales volumes at 
Afric Oil as we expect to benefit from the track record of our newly appointed sales personnel, 
amongst the many initiatives adopted by the Group in this regard. We will also prioritise cost 
optimisation, especially within the management structures across the Group. With respect to our 
Lagia asset, we will continue to explore beneficial partnerships on terms that create value 
for our shareholders.

CHANGES IN DIRECTORATE 
The following directors were appointed during the reporting period: 
Mr Vuyo Ngonyama                on 19 December 2018
Ms Zanele Radebe                on 19 December 2018
Ms Tariro Gadzikwa              on 7 February 2019

The following directors resigned during the reporting period: 
Mr Ignatius Sehoole             on 31 December 2018
Dr Thabo Kgogo                  on 30 January 2019

ABOUT EFORA
Efora Energy Limited is a South African based independent African oil and gas company, listed on 
the JSE. The Company has a diverse portfolio of assets spanning production in Egypt; exploration 
and appraisal in the Democratic Republic of Congo; a midstream project relating to crude trading 
in Nigeria; and material downstream distribution operations in South Africa. Our focus as a Group 
is on delivering energy for the African continent by using Africa's own resources to meet the 
significant growth in demand expected over the next decade.



CONDENSED PROVISIONAL CONSOLIDATED REVIEWED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 28 February 2019                                                            
                                                                               2019            2018
                                                              Notes           R'000           R'000
Revenue                                                           3       2 599 369       2 631 069
Cost of sales                                                            (2 530 997)     (2 568 287)
Gross income                                                                 68 372          62 782
Other income                                                                 94 199           7 094
Other operating costs (1)                                                  (861 828)       (246 338)
Loss from operations                                                       (699 257)       (176 462)
Share of profit from joint venture net of taxation                            1 138           1 878
Finance income                                                               68 230          53 073
Finance costs                                                               (47 474)        (55 017)
Loss before taxation                                                       (677 363)       (176 528)
Taxation                                                                     97 504             669
Loss for the year                                                          (579 859)       (175 859)
                                                                        
Other comprehensive income/(loss):
Items that may be reclassified to profit or loss in 
  subsequent periods:                                                                        
Exchange differences on translation of foreign operations (2)                84 420         (38 318)
Other comprehensive income/(loss) for the year net of taxation               84 420         (38 318)
                                                                        
Total comprehensive loss for the year                                      (495 439)       (214 177)
                                                                        
Loss attributable to:                                                                        
Equity holders of the Company                                              (538 311)       (151 971)
Non-controlling interests                                                   (41 548)        (23 888)
Loss for the year                                                          (579 859)       (175 859)
                                                                        
Total comprehensive loss attributable to:
Equity holders of the Company                                              (456 690)       (189 892)
Non-controlling interests                                                   (38 749)        (24 285)
Total comprehensive loss for the year                                      (495 439)       (214 177)
                                                                        
Loss per share                                                                         
Basic (cents)                                                    15          (69.91)         (42.34)
Diluted (cents)                                                  15          (69.91)         (42.34)

1 Impairment charges recognised in other costs are disclosed in notes 5,6 and 8.
2 This component of other comprehensive loss does not attract taxation.


CONDENSED PROVISIONAL CONSOLIDATED REVIEWED STATEMENT OF FINANCIAL POSITION
As at 28 February 2019                                                            
                                                                               2019            2018
                                                              Notes           R'000           R'000
ASSETS                                                                        
Non-current assets                                                                        
Exploration and evaluation assets                                            99 275          95 860
Oil and gas properties                                          5.1          76 808         169 243
Investment in joint venture                                                       -           5 847
Loans and other non-current receivables                           6         230 151         452 086
Property, plant and equipment                                                72 905          83 286
Intangible assets                                               5.2          80 364         261 655
Total non-current assets                                                    559 503       1 067 977
                                                                        
Current assets                                                                        
Loans and other current receivables                               6               -               -
Inventories                                                       7          13 744          22 454
Derivative asset                                                                  -             258
Trade and other receivables                                       8         188 545         146 509
Cash and cash equivalents                                         9          61 875          72 806
Total current assets                                                        264 164         242 027
Total assets                                                                823 667       1 310 004
                                                                                                  
EQUITY AND LIABILITIES                                                                        
Shareholders' equity                                                                        
Stated capital                                                   10       1 668 354       1 305 911
Reserves                                                         10         102 834          21 072
Accumulated loss                                                         (1 333 414)       (750 639)
Equity attributable to equity holders of the Company                        437 774         576 344
Non-controlling interests                                                    (3 813)          1 834
Total shareholders' equity                                                  433 961         578 178
                                                       
LIABILITIES                                                                        
Non-current liabilities                                                                        
Deferred tax liability                                           12               -          81 360
Borrowings                                                       13               -           5 152
Provisions                                                       12               -          53 271
Finance lease obligations                                                       126             714
Total non-current liabilities                                                   126         140 497
                                                                                                 
Current liabilities                                                                        
Borrowings                                                       13         240 720         388 895
Financial liabilities                                                           104           8 603
Finance lease obligations                                                       585           2 183
Loan from joint venture                                                      11 969           7 134
Taxation payable                                                             12 851          13 418
Trade and other payables                                         14         123 351         171 096
Total current liabilities                                                   389 580         591 329
Total liabilities                                                           389 706         731 826
Total equity and liabilities                                                823 667       1 310 004


CONDENSED PROVISIONAL CONSOLIDATED REVIEWED STATEMENTS OF CHANGES IN EQUITY
for the year ended 28 February 2019
                                                               Foreign                                                Total equity
                                                              currency    Share-based                                 attributable           Non-
                                                 Stated    translation        payment          Total                     to equity    controlling
                                                capital        reserve        reserve       reserves    Accumulated     holders of       interest          Total
                                               (Note 10)      (Note 10)      (Note 10)      (Note 10)          loss    the Company         ("NCI")        equity
                                                  R'000          R'000          R'000          R'000          R'000          R'000          R'000          R'000
Balance at 28 February 2017                   1 216 504         48 641          9 811         58 452       (598 668)       676 288              -        676 288
   Previously reported                        1 216 504         48 641          9 811         58 452       (587 075)       687 881              -        687 881
   Correction of error                                -              -              -              -        (11 593)       (11 593)             -        (11 593)
Changes in equity:                                                                               
Loss for the year                                     -              -              -              -       (151 971)      (151 971)       (23 888)      (175 859)
Other comprehensive loss for the year                 -        (37 921)             -        (37 921)             -        (37 921)          (397)       (38 318)
Total comprehensive loss for the year                 -        (37 921)             -        (37 921)      (151 971)      (189 892)       (24 285)      (214 177)
Acquisition through business combination         89 487              -              -              -              -         89 487         26 119        115 606
Transaction costs                                   (80)             -              -              -              -            (80)             -            (80)
Share-based payments expense                          -              -            541            541              -            541              -            541
Total changes                                    89 407        (37 921)           541        (37 380)      (151 971)       (99 944)         1 834        (98 110)
Balance at 28 February 2018                   1 305 911         10 720         10 352         21 072       (750 639)       576 344          1 834        578 178
Changes in equity:                                                                               
Effect of the adoption of IFRS 9 (note 4)             -              -              -              -        (11 362)       (11 362)             -        (11 362)
Restated balance at 1 March 2018              1 305 911         10 720         10 352         21 072       (762 001)       564 982          1 834        566 816
Loss for the year                                     -              -              -              -       (538 311)      (538 311)       (41 548)      (579 859)
Other comprehensive income for the year               -         81 621              -         81 621              -         81 621          2 799         84 420
Total comprehensive loss for the year                 -         81 621              -         81 621       (538 311)      (456 690)       (38 749)      (495 439)
Acquisition of non-controlling interest (note 11)     -              -              -              -        (33 102)       (33 102)        33 102              -
Rights issue                                    367 052              -              -              -              -        367 052              -        367 052
Transaction costs                                (4 609)             -              -              -              -         (4 609)             -         (4 609)
Share-based payments expense                          -              -            141            141              -            141              -            141
Total changes                                   362 443         81 621            141         81 762       (571 413)      (127 208)        (5 647)      (132 855)
Balance at 28 February 2019                   1 668 354         92 341         10 493        102 834     (1 333 414)       437 774         (3 813)       433 961


CONDENSED PROVISIONAL CONSOLIDATED REVIEWED STATEMENT OF CASH FLOWS
for the year ended 28 February 2019
                                                                               2019            2018
                                                              Notes           R'000           R'000
Cash flows from operating activities
Cash used in operations                                                    (147 283)        (65 641)
Finance income                                                                4 650           5 855
Finance costs                                                               (10 938)        (25 984)
Tax paid                                                                        (16)           (336)
Net cash used in operating activities                                      (153 587)        (86 106)
Cash flows from investing activities
Purchase of property, plant and equipment                                       (39)           (863)
Proceeds on disposal of property, plant and equipment                           380               -
Purchase of oil and gas properties                                           (2 974)         (5 104)
Purchase of intangible assets                                                (1 325)           (410)
Acquisition of subsidiary, net of cash acquired                                    -         20 202
Repayments of loans and other receivables                                       410             892
Advances of loans and other receivables                                      (1 201)              -
Net cash (used in)/from investing activities                                 (4 749)         14 717
Cash flows from financing activities
Transaction costs on issue of shares                                         (4 609)            (80)
Proceeds from rights issue                                                  367 052               -
Loan received from joint venture                                              3 505           2 732
Proceeds from borrowings                                                        239         164 467
Repayments of borrowings                                                   (210 523)        (39 771)
Repayments of financial liabilites                                           (5 815)              -
Repayments of finance lease obligations                                      (2 444)         (1 877)
Net cash from financing activities                                          147 405         125 471
Total movement in cash and cash equivalents for the year                    (10 931)         54 082
Cash and cash equivalents at the beginning of the year                       72 806          18 724
Cash and cash equivalents at the end of the year                  9          61 875          72 806


NOTES TO THE CONDENSED PROVISIONAL CONSOLIDATED REVIEWED FINANCIAL STATEMENTS
for the year ended 28 February 2019


1   BASIS OF PREPARATION
    The condensed provisional consolidated reviewed financial statements have been prepared in 
    accordance with the framework concepts, the recognition and measurement criteria of 
    International Financial Reporting Standards (IFRS) and in accordance with and containing the 
    information required by the International Accounting Standard 34 - Interim Financial Reporting 
    (IAS 34) as issued by the International Accounting Standards Board (IASB), the Financial 
    Reporting Guides as issued by the South African Institute of Chartered Accountants' (SAICA) 
    Accounting Practices Committee, Financial Pronouncements as issued by the Financial Reporting 
    Standards Council, the JSE Limited (JSE) Listings Requirements and the requirements of the 
    Companies Act of 2008, as amended. They have been prepared on the historical cost basis, 
    except for certain financial instruments which are measured at amortised cost, and are 
    presented in South African Rand, which is the Company's functional and presentation currency. 
    The significant accounting policies applied in the preparation of the condensed provisional 
    consolidated reviewed financial statements are in terms of IFRS and are consistent with those 
    applied in the previous consolidated annual financial statements, except as detailed in note 4. 
    The significant accounting policies are available for inspection at the Company's registered office.

    The Group adopted the new, revised or amended accounting pronouncements as issued by the IASB, 
    which were effective and applicable to the Group from 1 March 2018. The accounting pronouncement 
    considered by the Group as significant on adoption is IFRS 9 "Financial Instruments" (IFRS 9) 
    as set out in note 4. Other IFRS changes adopted on 1 March 2018 have no material impact on the 
    consolidated results, financial position or cash flows of the Group. Full details on changes in 
    accounting policies will be disclosed in the Group's consolidated annual financial statements 
    for the year ended 28 February 2019.

    New accounting pronouncements:
    IFRS 16 - Leases was issued in January 2016 to replace IAS 17 - Leases. The standard is effective 
    for accounting periods beginning on or after 1 January 2019 and will be adopted by the Group on 
    1 March 2019. IFRS 16 will primarily change lease accounting for lessees and will not have a 
    material impact on the Group's financial statements. Under IFRS 16:

    -  Lease agreements will give rise to the recognition of an asset representing the right to use 
       the leased item and a liability for future lease payables. 
    -  Lease costs will be recognised in the form of depreciation of the right of use asset and 
       interest on the lease liability. 

    Under IAS 17 operating lease rentals have been expensed on a straight-line basis over the lease 
    term within operating expenses. Lessee accounting for finance leases will be similar under 
    IFRS 16 to existing IAS 17 accounting. Lessor accounting under IFRS 16 is also similar to 
    existing IAS 17 accounting and is expected to be materially the same for the Group. IFRS 16 is 
    being adopted with the cumulative retrospective impact recorded as an adjustment to equity on 
    the date of adoption.
                                                                        
    These condensed provisional consolidated reviewed financial statements have been prepared on a 
    going concern basis after taking into account the matters in note 18. 

    All monetary information is rounded to the nearest thousand (R'000).
 
 
2   PREPARATION OF THE CONDENSED PROVISIONAL CONSOLIDATED REVIEWED FINANCIAL STATEMENTS AND 
    AUDITOR'S REVIEW CONCLUSION
    The directors take full responsibility for the preparation of these condensed provisional 
    consolidated reviewed financial statements. These condensed provisional consolidated reviewed 
    financial statements for the year ended 28 February 2019 have been prepared under the 
    supervision of the interim Chief Financial Officer, Tariro Gadzikwa CA (SA). 

    These condensed provisional consolidated financial statements for the year ended 28 February 2019 
    have been reviewed by SizweNtsalubaGobodo Grant Thornton Inc. A copy of the auditors' unmodified 
    review conclusion, which includes a material uncertainty relating to going concern with respect 
    to the matters detailed in note 18, is available for inspection at the registered office of 
    the Company.


3   SEGMENTAL REPORTING
    The Group has identified reportable segments that are used by the Group Executive Committee 
    (chief operating decision-maker) to make key operating decisions, allocate resources and assess 
    performance. For management purposes the Group is organised and analysed by geographical 
    locations. For the year under review the Group operated in the following locations: South Africa, 
    Egypt, Nigeria, DRC, Zimbabwe, Zambia and Mauritius. The Group's externally reportable operating 
    segments are shown below. 

    Head office activities include the general management, financing and administration of the Group. 
    The Group's operations in Zambia and Botswana, which were immaterial for the current year, did not 
    meet the recognition criteria for externally reportable segments and have been aggregated under the 
    South Africa and head office segment respectively as they meet the aggregation criteria permitted 
    by IFRS on the basis of the nature of the products. The Botswana segment was separately disclosed 
    in the prior year but due to the liquidation of Botwana the prior year figures have been aggregated 
    under the head office segment as it is not considered material.

                                                  Egypt        Nigeria            DRC   South Africa       Zimbabwe      Mauritius    Head office   Eliminations   Consolidated
    2019                                          R'000          R'000          R'000          R'000          R'000          R'000          R'000          R'000          R'000
    Revenue                                       3 848              -              -      2 748 428         18 940              -              -       (171 847)     2 599 369
    Cost of sales                                (7 333)             -              -     (2 677 134)       (18 377)             -              -        171 847     (2 530 997)
    Gross (loss)/profit                          (3 485)             -              -         71 294            563              -              -              -         68 372 
    Other income                                      -            221         67 148         15 214         11 944              -          6 078         (6 406)        94 199
    Impairment of financial assets                    -        (11 678)      (270 593)       (11 992)             -              -        (80 510)             -       (374 773)
    Depreciation and amortisation                (6 113)             -              -        (22 685)             -              -           (445)             -        (29 243)
    Share of profit from joint venture                -          1 138              -              -              -              -              -              -          1 138
    Finance income                                    -         11 194         23 862          2 538              -              -         36 683         (6 047)        68 230
    Finance costs                                     -              -         (3 676)       (41 658)             -              -         (8 187)         6 047        (47 474)
    Other operating expenses                    (10 072)          (717)          (821)       (65 749)       (21 813)          (213)       (60 892)         6 406       (153 871)
    Impairment on intangible assets             (30 739)             -              -       (143 522)             -              -              -              -       (174 261)
    Impairment of joint venture                       -         (8 142)             -              -              -              -              -              -         (8 142)
    Impairment of Lagia oil and gas assets 
      and petroleum reserves                   (121 538)             -              -              -              -              -              -              -       (121 538)
    Taxation                                          -              -         98 921         (1 417)             -              -              -              -         97 504
    (Loss)/profit for the year                 (171 947)        (7 984)       (85 159)      (197 977)        (9 306)          (213)      (107 273)             -       (579 859)
                                                                                          
    Segment assets - non-current                 97 235        115 075         99 275        100 596         32 259              -        468 027       (352 964)       559 503
    Segment assets - current                      9 732              2             25        256 578          5 695             61         15 111        (23 040)       264 164
    Segment liabilities - non-current          (143 745)             -        (81 970)      (127 341)             -              -              -        352 930           (126)
    Segment liabilities - current                (3 392)          (540)          (294)      (379 016)          (100)          (171)       (29 141)        23 074       (389 580)
                                                                                     
                                                  Egypt        Nigeria            DRC   South Africa       Zimbabwe      Mauritius    Head office   Eliminations   Consolidated
    2018                                          R'000          R'000          R'000          R'000          R'000          R'000          R'000          R'000          R'000
    Revenue                                       3 454              -              -              -         23 079              -              -        (21 052)     2 631 069
    Cost of sales                                (8 441)             -              -              -        (21 052)             -              -         21 052     (2 568 287)
    Gross profit/(loss)                          (4 987)             -              -              -          2 027              -              -              -         62 782
    Other income                                      -            201              -          5 229             53              -         10 511         (8 865)         7 094
    Depreciation and amortisation                (5 842)             -              -           (153)             -              -           (768)             -        (28 673)
    Share of profit from joint venture                -          1 878              -              -              -              -              -              -          1 878
    Finance income                                    -         10 461         20 927              -              -              -         20 514           (905)        53 073
    Finance costs                                     -              -         (2 167)             -              -              -        (28 337)           905        (55 017)
    Other operating expenses                     (5 245)          (231)        (1 162)          (167)       (15 984)           (83)      (112 008)         8 865       (204 824)
    Impairment of financial assets                    -         (6 360)             -              -              -              -         (6 481)             -        (12 841)
    Taxation                                          -              -            626              -          1 065            173         (1 853)             -            669
    (Loss)/profit for the year                  (16 074)         5 949         18 224          4 909        (12 839)            90       (118 422)             -       (175 859)
                                                                                          
    Segment assets - non-current                217 510        102 930        302 803              -         34 559          9 763        315 108      (207 849)      1 067 977
    Segment assets - current                     10 385              2             25             24          4 613             56         16 737              -        242 027
    Segment liabilities - non-current          (114 841)             -       (211 136)             -        (35 014)        (9 762)             -        246 624       (140 497)
    Segment liabilities - current                (4 097)           (30)             -              -        (87 396)           (91)      (184 929)       (38 775)      (591 329)

    Business segments
    The operations of the Group comprise oil and gas exploration and production, crude trading and 
    the sale of petroleum products. 

    Revenue 
    The Group derives revenue from the following sources:
    - The sale of crude oil from the Lagia Oil Field to the Egyptian General Petroleum Corporation 
      ("EGPC"). This revenue is included under the Egypt segment.
    - Sales of petroleum products to a diversified customer base which includes local government and 
      mining, construction, transport, manufacturing, retail and agricultural customers. These revenues 
      are included under the South Africa and Zimbabwe segments.

    Inter-segment revenues are eliminated upon consolidation and are reflected in the "eliminations" column.
                                                                        
    Revenue from contracts with customers is disaggregated as follows:
                                                                               2019            2018
                                                                              R'000           R'000
    Sale of crude oil                                                         3 848           3 454 
    Sale of petroleum products                                            2 595 521       2 627 615 
                                                                          2 599 369       2 631 069 

    During the year ended 28 February 2019, R1.0 billion or 40% (2018: no customer with revenue of 
    10% or more of total revenue) of the Group's revenue depended on the sales of petroleum products 
    to two customers under the South Africa segment.
                                                                        
    Taxation - Egypt
    No income or deferred tax has been accrued by Mena International Petroleum Company Limited ("Mena") 
    as the Concession Agreement between the EGPC, the Ministry of Petroleum and Mena provides that 
    the EGPC is responsible for the settlement of income tax on behalf of Mena, out of EGPC's share 
    of petroleum produced. The Group has elected the net presentation approach in accounting for 
    this deemed income tax. Under this approach Mena's revenue is not grossed up for income tax 
    payable by EGPC on behalf of Mena. Consequently, no income tax or deferred tax is accrued.


4   ADOPTION OF NEW ACCOUNTING STANDARD
    Adoption of IFRS 9
    The Group has adopted IFRS 9 and applied the new rules using a modified retrospective approach 
    from 1 March 2018. Comparatives for the year ended 28 February 2018 have not been restated. 
    In terms of IFRS 9, the Group has applied the expected credit losses ("ECL") model which replaces 
    the incurred losses model in determining the impairment provisions for financial assets. 
    The calculation of ECLs incorporates forward looking variables which include potential risks 
    in the current economic environment, historic trends and management judgement. The Group has 
    recognised a transition adjustment to the opening accumulated losses and ECLs for the current 
    year are recognised in the statement of comprehensive income under "other operating costs".
                                                                              
    The adoption of IFRS 9 did not change the categorisation of the Group's financial assets as 
    shown below. The impact of the adoption of IFRS 9 on the carrying amounts of the Group's 
    financial assets is outlined below.
                                                                              
                                                                                      Carrying amount                     Carrying amount
                                             Original IAS 39          New IFRS 9      under IAS 39 at       Adoption of   under IFRS 9 at
                                             category                 category       28 February 2018            IFRS 9      1 March 2018
    Balance sheet (extract)                                                                     R'000             R'000             R'000
    Loans and other current receivables      Loans and receivables    Amortised cost          452 086           (11 362)          440 724 
    Trade and other receivables              Loans and receivables    Amortised cost          146 509                 -           146 509 
    Cash and cash equivalents                Loans and receivables    Amortised cost           72 806                 -            72 806 
    Impact on the Group's financial assets                                                    671 401           (11 362)          660 039 
                                                                              
    The adoption of IFRS 9 did not result in a material adjustment to trade and other receivables 
    and cash and cash equivalents at 1 March 2018.
                                                                              
    The adjustment to the Group's accumulated losses as a result of the adoption of IFRS 9 under the 
    modified retrospective approach is shown below:
                                                                              
                                                                                      Under IAS 39 at       Adoption of   under IFRS 9 at
                                                                                     28 February 2018            IFRS 9      1 March 2018
                                                                                                R'000             R'000             R'000
    Accumulated loss                                                                         (750 639)          (11 362)         (762 001)
    Impact on equity                                                                         (750 639)          (11 362)         (762 001)
                                                                              
    The impact of the adoption of IFRS 9 on the Group's impairment provisions is summarised in 
    notes 6 and 8.
                                                                              
    Adoption of IFRS 15                                                                        
    IFRS 15 - Revenue from Contracts with Customers ("IFRS 15") replaces IAS 18 Revenue and related 
    interpretations. IFRS 15 establishes a five-step model to account for revenue arising from 
    contracts with customers and requires that revenue be recognised at an amount that reflects the 
    consideration to which an entity expects to be entitled in exchange for transferring a good or 
    service. IFRS 15 requires entities to exercise judgement, taking into consideration all the 
    relevant facts and circumstances when applying each step of the revenue recognition model to 
    contracts with customers. The standard also specifies the accounting treatment for revenue 
    recognition costs directly related to obtaining a customer contract. 

    The Group has adopted IFRS 15 using the cumulative retrospective approach with the date of initial 
    application being 1 March 2018, and has applied the new accounting policy to all contracts that were 
    in existence at 1 March 2018. While IFRS 15 represents significant new guidance for revenue 
    recognition and measurement, the implementation of IFRS 15 did not have a significant impact on 
    the timing or amount of revenue recognised by the Group in any year.
    
    Under IFRS 15, revenue from contracts with customers is recognised when a performance obligation 
    is satisfied by transferring a promised good or service to a customer. A good or service is 
    transferred when the customer obtains control of that good or service. The transfer of control 
    of Efora's products usually coincides with title passing to the customer and the customer taking 
    physical possession, with the Group's performance obligations primarily satisfied at that point 
    in time. Revenue is measured based on the consideration specified in a contract with a customer 
    and excludes amounts collected on behalf of third parties. Invoices for products transferred are 
    payable between 15 and 30 days, depending on the credit terms granted to customers. Payments 
    are otherwise due immediately upon delivery for cash customers.

                                                                              
5   IMPAIRMENTS OF NON-FINANCIAL ASSETS
5.1 Oil and gas assets
                                                                                              Total
    Cost                                                                                      R'000
    At 1 March 2018                                                                         187 532
    Additions                                                                                 2 974
    Exchange differences                                                                     28 499
    At 28 February 2019                                                                     219 005
                                                                              
    Depletion                                                                         
    At 1 March 2018                                                                         (18 289)
    Provision for impairment                                                               (121 538)
    Depletion                                                                                (2 370)
    At 28 February 2019                                                                    (142 197)
                                                                              
    Net book value                                                                        
    At 28 February 2018                                                                     169 243
    At 28 February 2019                                                                      76 808
                                                                              
    A provision for impairment of R152.2 million (US$10.9 million) (2018: Rnil) has been recognised 
    with respect to the Lagia oil and gas assets (R121.5 million) and other intangible assets 
    (R30.7 million) (see note 5.2) under other operating costs within the Egypt segment. 
    The impairment is a result of the reduction in Lagia 2P reserves and therefore the recoverable 
    amount as reported in the 2019 Competent Persons Report (CPR) relative to the 2018 CPR. 
    The recoverable amount has been negatively impacted by (a) changes in oil sales price forecast, 
    (b) changes in the oil production forecast and (c) the effect of rolling the report forward by 
    one year, while the end of the licence term remains fixed. The 2019 CPR oil sales price forecast 
    is 12.5% lower on average over the field life. The 2019 CPR 2P production profile is 
    approximately 89% lower for the calendar year 2019 due to the fact that no new production wells 
    were drilled in 2018. The assumption in the 2018 CPR was that eight new production wells would be 
    drilled. The production associated with these wells is therefore not included in the 2019 
    forecast. This difference continues at a reducing rate up to 2025 when production from the 
    eight wells would have terminated. 

    The recoverable amount of the oil and gas assets and petroleum reserves of R101.2 million 
    (US$7.2 million) was determined using value in use calculations where future cash flows were 
    estimated and discounted at a weighted average cost of capital of 10%. 

    Additions and depletion are not significant for the year under review. 
                                                                              
5.2 Intangible assets                                                                        
                                                                                                              Lagia
                                           Computer                        Customer                      intangible
                                           software          Brands   relationships        Goodwill          assets           Total
    Cost                                      R'000           R'000           R'000           R'000           R'000           R'000
    At 28 February 2018                       2 513           9 672          79 082         135 443          69 463         296 173
    Additions                                 1 325               -               -               -               -           1 325
    Disposal                                   (105)              -               -              (3)              -            (108)
    Write-off of assets                        (721)              -               -               -               -            (721)
    Exchange differences                        (18)              -               -               -           9 013           8 995
    At 28 February 2019                       2 994           9 672          79 082         135 440          78 476         305 664
                                                                              
    Accumulated depreciation and impairment                                                                        
    At 28 February 2018                        (834)              -         (12 487)              -         (21 197)        (34 518)
    Disposal                                    105               -               -               -               -             105
    Impairment                                    -            (719)         (7 363)       (135 440)        (30 739)       (174 261)
    Amortisation                               (230)         (3 869)         (7 135)              -          (6 113)        (17 347)
    Write-off of assets                         721               -               -               -               -             721
    At 28 February 2019                        (238)         (4 588)        (26 985)       (135 440)        (58 049)       (225 300)
                                                                              
    At 28 February 2018                       1 679           9 672          66 595         135 443          48 266         261 655
    At 28 February 2019                       2 756           5 084          52 097               -          20 427          80 364
                                                                              
    The following impairments have been recognised in the statement of comprehensive income under 
    other operating costs with respect to the Group's intangible assets:

    Afric Oil
    The goodwill of R62.8 million allocated to the Afric Oil cash-generating unit (""CGU"") on 
    acquisition was tested for impairment as at 28 February 2019. The CGU was compared to its 
    recoverable amount which was determined through value-in-use calculations where future cash flows 
    were estimated and discounted at the weighted average cost of capital. The recoverable amount 
    of the Afric Oil CGU as at 28 February 2019 was determined to be R104.4 million excluding the 
    Group's share of debt. The discount rate applied to the cash flow projections is 12.05%. As a 
    result of the analysis, management recognised an impairment of R62.8 million for the Afric Oil 
    CGU which was allocated against goodwill.

    Forever Fuels
    The goodwill of R68.1 million, customer relationships with a carrying amount of R59.5 million 
    and brands with a carrying amount of R5.8 million allocated to the Forever Fuels cash-generating 
    unit ("CGU") on acquisition were tested for impairment as at 28 February 2019. The CGU was 
    compared to its recoverable amount which was determined through value-in-use calculations where 
    future cash flows were estimated and discounted at the weighted average cost of capital. 
    The recoverable amount of the Forever Fuels CGU as at 28 February 2019 was determined to be 
    R57.2 million. The discount rate applied to the cash flow projections is 12.05%. As a result 
    of the analysis, management recognised an impairment of R76.7 million for the Forever Fuels 
    CGU of which R68.1 was allocated against goodwill. The remainder of the impairment charge was 
    allocated to brands and customer relationships on an apportionment basis as shown in the table above.

    Boland
    The goodwill of R4.0 million allocated to the Boland cash-generating unit (""CGU"") on 
    acquisition was tested for impairment as at 28 February 2019. The CGU was compared to its 
    recoverable amount which was determined through value-in-use calculations where future cash flows 
    were estimated and discounted at the weighted average cost of capital. The recoverable amount 
    of the Boland CGU as at 28 February 2019 was determined to be R6.5 million. The discount rate 
    applied to the cash flow projections is 12.05%. As a result of the analysis, management 
    recognised an impairment of R4.0 million for the Boland CGU which was allocated against goodwill.

    The impairments above were a result of loss-making operations. There were no impairments of 
    intangible assets in the prior financial year.


6   LOANS AND OTHER RECEIVABLES
                                                                               2019            2018
                                                                              R'000           R'000
    Non-current                                                                        
    Loan due from EERNL                                                           -          50 978
    Transcorp Refund                                                        231 203         194 165
    Supplier development loans                                                3 818           2 618
    Contingent consideration                                                      -         206 943
    Deferred consideration on disposal of Greenhills Plant                        -             521
                                                                            235 021         455 225
    Less: Provision for impairment                                           (4 870)         (3 139)
                                                                            230 151         452 086
                                                                              
    Current                                                                        
    Advance payment against future services                                       -         115 825
    Loan due from EERNL                                                      69 970               -
    Phembani Group Proprietary Limited                                          827             827
    Deferred consideration on disposal of Greenhills Plant                    1 805           1 573
                                                                             72 602         118 225
    Less: Provision for impairment                                          (72 602)       (118 225)
                                                                                  -               -
                                                                              
    Advance payment against future services
    As previously reported, the Company was claiming R115.8 million from Encha Group Limited. 
    This amount had historically been fully provided for. As referred to in note 19, the Group's 
    claim was dismissed by the arbitrator. In this regard the Group has utilised the provision for 
    impairment of R115.8 million previously recognised to write off this asset as at 28 Februry 2019 
    as this development is considered to be an adjusting event. This did not impact the Group's 
    statement of comprehensive income.
                                                                              
    Contingent consideration                                                                        
    As previously reported, the Group was entitled to a contingent consideration to be settled by 
    Total once the Block III operations reached first investment decision date and first oil date. 
    Given Total's termination of its participation in the block, which extinguishes its indebtedness, 
    the Group has derecognised this receivable totalling R270.6 million as at 28 February 2019 by 
    way of a charge to the statement of comprehensive income under other operating expenses. Total's 
    exit from Block III also resulted in the derecognition of the deferred tax liability attributable 
    to the contingent consideration and the Group's liability under the cost carry arrangement 
    which partially off-set the impact of the derecognition of the contingent consideration on the 
    statement of comprehensive income. Refer to notes 12 and 19 for further details.
                                                                              
    Movements in the Group's significant loans and other receivable are as follows:
                                                                              
                                                              Gross                                                                     Net
                                                    carrying amount      Provision for        Specified                     carrying amount
                                                   28 February 2019 (1)     impairment       impairment (2)   Write-down   28 February 2019
                                                              R'000              R'000            R'000            R'000              R'000
    Advance payment against future services                 115 825                  -                -         (115 825)                 -
    Contingent consideration                                270 593           (270 593)               -                -                  -
    Transcorp Refund                                        254 390             (1 052)         (23 187)               -            230 151
    Loan due from EERNL                                      66 117            (60 029)          (6 088)               -                  - 
                                                            706 925           (331 674)         (29 275)        (115 825)           230 151

    1 Before impairments and write-downs.
    2 Time value adjustments attributable to the deferral of the receipt of expected contractual cash flows.
                                                                         
                                                                         Credit impaired
                                                                        financial assets
                                                  Lifetime expected   (lifetime expected 
                                                      credit losses        credit losses) (1)       Total
                                                              R'000                R'000            R'000
    At 1 March 2018                                         121 364                    -          121 364 
    Effect of adoption of IFRS 9 (note 4)                    11 362                                11 362 
    Balance at 1 March under IFRS 9                         132 726                    -          132 726 
    Write-offs                                             (115 825)                             (115 825) 
    Transfer to credit impaired                              (9 941)               9 941                - 
    Changes in risk parameters                                1 369               60 029           61 398 
    Other                                                      (827)                   -             (827) 
                                                              7 502               69 970           77 472 
                                                                              
    1 EERNL was placed under liquidation in February 2019 and the recoverability of this receivable 
      has become doubtful. The Group is engaging with the liquidator regarding the settlement of 
      this debt and we await finalisation of the liquidation process. As a result of the increase 
      in provision for impairment, the amount due from EERNL is now provided for in full. The loan 
      due from EERNL is now classified as short term.

                                                                              
7   INVENTORIES
                                                                               2019            2018
                                                                              R'000           R'000
    Consumables                                                               6 441           5 794 
    Petroleum products                                                        7 303          16 660 
                                                                             13 744          22 454 
                                                                              
    A write-off of R10.5 million was recognised in other operating costs arising from inventory 
    losses at Boland Diesel Proprietary Limited, a wholly owned subsidiary of the Company. 
    The preliminary independent investigation has just been completed and the findings thereof are 
    not conclusive. Management is evaluating the recommendation to further the scope of the investigation.
                  
                                                            
8   TRADE AND OTHER RECEIVABLES
                                                                               2019            2018
                                                                              R'000           R'000
    Trade receivables                                                       229 781         175 287
    Value-added tax                                                           1 418           1 792
    Other receivables                                                        14 764          12 527
                                                                            245 963         189 606
    Less: Provision for impairment                                          (57 418)        (43 097)
                                                                            188 545         146 509
                                                                              
    Trade receivables are non-interest bearing (except in the event of default) and are generally 
    on 30 days' terms. The adoption of IFRS 9 did not result in a material adjustment to the 
    impairment provision as at 1 March 2018. The provision for impairment of trade and other 
    receivables is based on lifetime expected credit losses.
                                                                              
    The movements in the provision for impairment of trade receivables determined using the ECL model 
    are outlined below:
                                                                               2019            2018
                                                                              R'000           R'000 
    At 1 March                                                               42 558               - 
    Acquired through business combination                                         -          53 462 
    Exchange differences                                                        443               - 
    Utilisation of provision                                                   (618)              -
    Arising/(reversed) during the year                                        9 248         (10 904)
    At 28 February                                                           51 631          42 558 
                                                                              
                                                                              
9   CASH AND CASH EQUIVALENTS
                                                                               2019            2018
                                                                              R'000           R'000 
    Cash and cash equivalents consist of:
    Cash at banks and on hand                                                40 142          45 020 
    Short-term deposits                                                       6 033          12 086 
    Total unrestricted cash                                                  46 175          57 106 
    Restricted cash balances                                                 15 700          15 700 
    Cash and cash equivalents                                                61 875          72 806 
                                                                              
    Cash at banks earns interest at floating rates. Short-term deposits are made for varying periods 
    depending on the immediate cash requirements of the Group, and earn interest at the respective 
    short-term deposit rates. The restricted cash balances constitutes cash guarantees issued in 
    favour of creditors.

    A total of R2.4 million (2018: R1.9 million) is denominated in United States Dollar. 
    At 28 February 2019, the Group had no undrawn committed borrowing facilities.
          
                                                                    
10  STATED CAPITAL AND RESERVES                                                2019            2018
                                                                              
    Stated capital                                                                        
    Authorised:                                                                         
    Number of ordinary shares with no par value              (000's)      5 000 000       1 000 000
                                                                              
                                                                              
    Allotted equity share capital:
    Reported at the beginning of the year                    (R'000)      1 305 911       1 216 504
    Non-cash shares issued                                   (R'000)              -          89 487
    Issued during the year for cash                          (R'000)        367 052               -
    Share issue costs                                        (R'000)         (4 609)            (80)
    As at 28 February                                        (R'000)      1 668 354       1 305 911
                                                                              
    Reconciliation of number of shares issued:
    Reported at the beginning of the year                    (000's)        369 733       3 269 836
    Non-cash shares issued                                   (000's)              -         427 478
    Issued during the year for cash                          (000's)        734 103               -
    Share consolidation                                      (000's)              -      (3 327 581)
    As at 28 February                                        (000's)      1 103 836         369 733
                                                                              
    Issued during the year for cash:                                                                        
                                                                          Number of           Issue
                      Nature of        Recipient                      shares issued           price         Value
    Date              transaction                                            (000's)              R         R'000
    13 August 2018    Rights issue     Government Employees Pension Fund    728 593            0.50       364 297 
    13 August 2018    Rights issue     Other shareholders                     5 510            0.50         2 755 
                                                                            734 103            0.50       367 052 
                                                                              
    Non-cash shares issued in the prior year comprise:
                                                                                          Number of           Issue
                      Nature of                         Recipient                     shares issued           price (1)     Value
    Date              transaction                                                             (000s)              R         R000s
    31 May 2017       Part consideration for 
                      the acquisition of Afric Oil      Gentacure Proprietary Limited       387 459            0.21        81 110 
    31 May 2017       Part consideration for the        Moopong Investment Holdings
                      acquisition of Afric Oil          Proprietary Limited                  40 019            0.21         8 377 
                                                                                            427 478            0.21        89 487 
    1 The issue price is rounded to two decimal places. 

                                                                            Foreign
                                                                           currency         
                                                        Share-based     translation
    Reserves                                        payment reserve         reserve           Total
    Group                                                     R'000           R'000           R'000
    Balance at 28 February 2017                               9 811          48 641          58 452
    Share based payment expense                                 541               -             541
    Foreign exchange losses arising on translation 
      of foreign operations                                       -         (37 921)        (37 921)
    Balance at 28 February 2018                              10 352          10 720          21 072
    Share based payment expense                                 141               -             141
    Foreign exchange gains arising on translation 
      of foreign operations                                       -          81 621          81 621
    Balance at 28 February 2019                              10 493          92 341         102 834
           
                                                                   
11  ACQUISITION OF NCI                                                                        
    Following an arbitration award issued during the year, the Group now owns 100% (2018: 65%) of 
    Afric Oil Petroleum (Zimbabwe). The increase in ownership was granted for no consideration.
     
                                                                         
12  DEFERRED TAX LIABILITIES AND PROVISIONS
    The termination of Total's participation in Block III as referred to under note 6 resulted in 
    the derecognition of the following liabilities:
                                                                                               2019
                                                                                              R'000
    Deferred tax                                                                            108 452 
    Provision for carried cost reimbursement                                                 67 148 
                                                                                            175 600 


13  BORROWINGS
    The Company settled its loan from Gemcorp in August 2018 through payment of R187.0 million from 
    the proceeds of the rights issue.

    The Company's 71% owned subsidiary Afric Oil Proprietary Limited is in breach of debt covenants 
    relating to its loan arrangement with the Unemployment Insurance Fund (UIF).  Management of 
    Afric Oil are in discussions with the PIC, manager of the UIF, to address the breaches in the 
    covenants and to reset the same to the revised payment profile and cash-generation levels of 
    the business. 
       
                                                                       
14  TRADE AND OTHER PAYABLES
                                                                               2019            2018
                                                                              R'000           R'000 
    Trade payables                                                           98 579         143 111 
    Accruals                                                                  8 735          26 753 
    Other payables                                                           16 037           1 232 
                                                                            123 351         171 096 
                                                                              
    The carrying values of trade and other payables approximate their 
    fair values. The carrying values of the Group's trade and other 
    receivables are denominated in the following currencies:
                                                                              
    US Dollar                                                                 4 574           8 827 
    South African Rand                                                      118 777         162 269 
                                                                            123 351         171 096 
                                                                              
    The maximum exposure to credit risk at the reporting date is the carrying value of each class 
    of trade and other payable mentioned above. Trade payables are non-interest bearing and are 
    generally on 30 to 60 day terms.
                                                                              
                                                                 
15  LOSS PER SHARE                                                                        
                                                                               2019            2018
    Basic (cents)                                                            (69.91)         (42.34)
    Diluted (cents)                                                          (69.91)         (42.34)
                                                                              
    Both the basic and diluted earnings per share have been calculated 
    using the loss attributable to shareholders of the Company as the 
    numerator. No adjustments to profit were necessary in 2019 and 2018.

    Loss attributable to equity holders of the Company used 
    in the calculation of the basic and diluted loss per share  (R'000)    (538 311)       (151 971)
                                                                              
    Weighted average number of ordinary shares used in the 
    calculation of basic loss per share                         (000's)     769 968         358 956 
       Issued shares at the beginning of the reporting period   (000's)     369 731       3 269 836 
       Effect of shares issued during the reporting period 
       (weighted)                                               (000's)     400 237         319 729 
       Share consolidation                                      (000's)           -      (3 230 609)
                                                                              
    Add: Dilutive share options                                 (000's)           -               - 
    Weighted average number of ordinary shares used in the 
    calculation of diluted loss per share                       (000's)     769 968         358 956 
                                                                              
    Headline loss per share                                                                        
    Basic (cents)                                                            (45.31)         (42.20)
    Diluted (cents)                                                          (45.31)         (42.20)
                                                                              
    Reconciliation of headline loss                                           R'000           R'000
    Loss attributable to equity holders of the Company                     (538 311)       (151 971)
    Adjust for:                                                                        
    Impairment of Lagia oil and gas assets (note 5.1)                       121 538               -
    Impairment of intangible assets (note 5.2)                              174 261               -
    Gain on settlement of property purchase price                            (7 651)              -
    Impairment of joint venture                                               8 142               -
    Write-off of property, plant and equipment                                    -             535
    Loss on disposal of property, plant and equipment                         4 920               -
    Write-off of exploration and evaluation asset                                 -             307
    Adjustments attibutable to NCIs                                         (49 744)           (155)
    Tax effects of adjustments                                              (62 035)           (192)
    Headline loss                                                          (348 880)       (151 476)
    

16  FAIR VALUE MEASUREMENT                                                                        
    The fair values of cash and cash equivalents, trade and other receivables, trade and other 
    payables, financial liabilites, borrowings and the loan from the joint venture approximate 
    carrying values due to the short-term maturities of these instruments. Set out below is a 
    comparison, by class, of the carrying amounts and fair values of the Group's financial 
    instruments, other than those with carrying amounts that are reasonable approximations of 
    fair values:

                                                  Carrying value                     Fair value      
                                               2019            2018            2019            2018
                                              R'000           R'000           R'000           R'000
    Loans and receivables                                                                        
    Loans and other receivables (note 6)    230 151         452 086         245 783         389 582
                                                                              
    Valuation techniques and assumptions applied to measure fair values
    When the fair values of financial assets and financial liabilities recorded in the statement of 
    financial position cannot be measured based on quoted prices in active markets, their fair value 
    is measured using valuation techniques including the discounted cash flow ("DCF") model. The inputs 
    to these models are taken from observable markets where possible, but where this is not feasible, 
    a degree of judgement is required in establishing fair values. Judgements include considerations 
    of inputs such as liquidity risk, credit risk and volatility. Changes in assumptions relating 
    to these factors could affect the reported fair value of financial instruments.
                                                                              
                                    Fair value at
    Assets                       28 February 2019     Valuation          Method                        Significant inputs      
    Loans and other receivables           245 783     Income approach    Discounted cash flow model    Weighted average cost of capital
                                                                              
    Fair value hierarchy                                                                        
    The following table presents the Group's assets for which the fair value is disclosed above. 
    The different levels have been defined as follows:
                                                                              
    Level 1: Quoted (unadjusted) prices in active markets for identical assets or liabilities
    Level 2: Other techniques for which all inputs which have a significant effect on the recorded 
    fair value are observable, either directly or indirectly
    Level 3: Techniques which use inputs that have a significant effect on the recorded fair value 
    that are not based on observable market data

                                            Level 1         Level 2         Level 3           Total
    At 28 February 2019                                                                        
    Loans and other receivables                   -               -         245 783         245 783 
                                                                              
    There were no transfers between any levels during the year. 
       
                                                                       
17  COMMITMENTS AND CONTINGENT LIABILITIES
    Commitments                                                                        
                                                                              
    Operating leases:                                                          2019            2018
                                                                              R'000           R'000
    Within one year                                                           2 835          10 110
    After one year but not more than five years                                   -           2 376
                                                                              2 835          12 486
                                                                              
    Finance leases:                                                                        
                                                                               2019            2018
    Present value of minimum lease payments                                   R'000           R'000
    - Within one year                                                           585           2 183
    - After one year but not more than five years                               126             714
                                                                                711           2 897
                                                                              
    Contingent liabilities                                                                        
                                                                              
    Claimed transation fees                                                                        
    Gem Capital issued summons against Afric Oil Proprietary Limited on 11 October 2017. 
    The claim is twofold:

    1. Gem Capital's is claiming outstanding fees for assisting Afric Oil with the procurement of 
       financing from the Public Investment Corporation to purchase Forever Fuels. The claim is for 
       an outstanding amount of R0.5 million plus interest at 2% above prime rate from 22 May 2017. 
       The claim is being opposed by the company's attorneys TGR Attorneys.
    2. Gem Capital is claiming success fees for providing advice and assistance with the "SacOil" 
       (now Efora) transaction, being the acquisition of Afric Oil by Efora for R200 million 
       (correct purchase price is R130.7 million). The claim is for R6.8 million plus interest at 
       2% above prime rate from 31 May 2018. The claim is being opposed by the company's attorneys, 
       TGR Attorneys.

       Noble Company Proprietary Limited issued summons against Afric Oil Proprietary Limited 
       claiming R1.4 million in capital raising fees. The claim is being opposed by the company's 
       attorneys, TGR Attorneys.

       The outcome of these matters cannot be estimated at this point in time and accordingly, 
       no provision was recognised at 28 February 2019.


18  GOING CONCERN
    The Group incurred a net loss for the year ended 28 February 2019 of R579.9 million 
    (2018: R175.9 million). The results of the Group for the year then ended are a manifestation 
    of the continued underperformance of its key subsidiaries, Afric Oil and Mena, and further 
    reflect the impact of consequential impairment losses coupled with further impairment charges 
    arising from the adoption of IFRS 9 and developments relating to some of our non-operating 
    assets. The challenges experienced at Afric Oil which include working capital constraints, 
    loss of customers and increased competition had a significant impact on the profitability and 
    cash generation of the business. As a result, the Group is reporting a cash out flow of 
    R153.6 million for the year ended 28 February 2019 (2018: R86.1 million) from operations. 
    Whilst the Group cash flow forecasts ("Forecast") to 28 February 2021 ("Forecast Period") 
    indicate that the Group will be adequately funded based on the funds available and the plans 
    in place to remedy the challenges which affected the Group during the year, there are 
    uncertainties that exist with respect to the materialisation of these plans and therefore the 
    ability of the Group to remain a going concern.

    Management has put in place the following plans in order to improve the performance and 
    financial position of the Group:
    -  Management has implemented an aggressive sales strategy to drive sales growth targeting key 
       sectors where the Group has a competitive advantage.
    -  Management has recently recruited additional experienced sales with an impeccable track 
       record to drive volumes growth in its various business units.
    -  Additional working capital facilities have been secured.
    -  Initiatives are in place to improve the working capital management of the Group.
    -  Further cost optimisation and other synergies are expected from the merging of the Afric Oil 
       and Efora offices expected from June 2019.

    The Board is reasonably confident that these plans will have a positive impact on the performance 
    and financial position of the Group. Given the degree of judgement and assumptions used to 
    determine the Forecast, one cannot establish with certainty the extent to which management's 
    plan will materialise. The following uncertainties therefore exist with respect to the Group's 
    ability to remain a going concern as it may not be able to realise its assets and discharge 
    its liabilities in the normal course of business:
 
    Operational performance of the Group
    Whilst management has explored further opportunities for cost optimisation, an improvement in 
    performance of the Group is expected from an increase in the gross margin contribution 
    underpinned by volumes growth, primarily driven by the Afric Oil business. Management is 
    projecting an increase of at least 25% in sales volumes from the current levels. It is difficult 
    to establish with certainty the extent to which this growth target will be achieved.

    Availability of funding for the Group's activities
    Afric Oil is due to settle R92.9 million, inclusive of interest, of the loan owed to the UIF 
    during the Assessment Period. Afric Oil's performance as outlined above will determine its 
    ability to repay this loan. As highlighted in note 12, Afric Oil is in breach of debt covenants 
    pertaining to this loan. Management are in discussions with the PIC, manager of the UIF, 
    to address the breach and to agree restructuring of the outstanding shareholder loan. 
    Discussions in this regard are ongoing. It is uncertain the extent to which the shareholder 
    loan will be restructured as any immediate repayment of the loan due to the breach with result 
    in the Group not being able to discharge its liabilities in the normal course of business.

    The gearing ratio for the Group is around 58% that has significantly increased due to the number
    of impairments at year-end. This is above the target range of the Group of around 30% to 40%.
    The Group will focus on improving the performance of the underlying business to address the concerns
    that resulted in the number of impairments that negatively impacted the equity position of the Group.

    Conclusion
    Should the Group not achieve its sales targets and as a minimum only maintain its current 
    volumes, a cash deficit of R89.8 million will exist for the Assessment Period, starting from 
    July 2020. 
                                                                              
                                                                              
19  EVENTS AFTER THE REPORTING PERIOD
    The following events took place from the period 1 March 2019 to the date of this report.
                                                                              
    Developments with litigation
    R Vela                                                                        
    The Supreme Court of Appeal ("SCA") in a written judgment issued on 29 March 2019 dismissed 
    Mr Vela's appeals, but allowed his appeal in respect of the leave pay claim in part. It granted 
    Efora's cross-appeal, with costs and interest. The SCA ordered Robin Vela to pay Efora:

    - R3 324 524.36 with respect to PAYE taxes;
    - interest on the above amount at the prescribed mora rate from 26 March 2014 to date of payment; and
    - Efora's legal costs (to be determined in due course, but estimated to be in the region of at 
      least R300 000).

    The SCA has ordered the Company to pay Robin Vela R103 661.28 as leave pay. Practically speaking, 
    this amount falls to be deducted from the amounts the SCA ordered Robin Vela to pay Efora. 
    Robin Vela is requesting a payment plan over 12 months with respect to amounts owed. 
    Discussions regarding this are ongoing.

    Claim against Encha Group Limited
    Arbitration commenced on 26 March 2019 and has been completed. Judgement was issued on 29 May 2019 
    wherein the Company's claim against Encha Group Limited was dismissed. The Company was ordered 
    to pay the cost of the arbitration as well as the costs incurred by the defendant. These costs 
    are still to be quantified. Management is studying the judgement with senior counsel in order 
    to assess the basis and prospects to appeal the judgement.
                                                                              
    Block III                                                                        
    Efora obtained a licence extension for Block III in the DRC that extends the licence until 
    July 2019, during which time the remaining partners will carry out a review of the technical 
    data to determine the area that will be the subject of the renewal of the licence in July 2019.
                                                                              
    Total E&P RDC, which previously held 66.7% of the working interest in Block III, has indicated 
    that it will no longer continue as part of the consortium to further explore Block III. 
    Consequently, Efora will be required to pay its working interest share of forward costs 
    (still to be determined) associated with Block III. In addition, Efora now has the option to 
    increase its working interest in Block III to 42.5% and is currently evaluating whether it 
    will take up this option.
                                                                              
    On behalf of the Board
                                                                              
                                                                              
                                                      `                        
    Boars Seruwe          Damain Matroos                        Tariro Gadzikwa
    Chairman              Chief Executive Officer (Interim)     Chief Financial Officer (Interim)
                                                                              
    Johannesburg                                                                        
    31 May 2019 

SPONSOR
PSG Capital                                                                       


CORPORATE INFORMATION
Registered office and physical address:
1st Floor, 12 Culross Road, Bryanston, 2021
Postal address:
PostNet Suite 211
Private Bag X75, Bryanston, 2021
Contact details:
Tel: +27 (0) 10 591 2260
Fax: +27 (0) 10 591 2268
E-mail: info@eforaenergy.com
Website: www.eforaenergy.com

Directors
Damain Matroos (Interim Chief Executive Officer), Tariro Gadzikwa (Interim Chief Financial Officer), 
Boas Seruwe (Chairman), Thuto Masasa*#, Patrick Mngconkola, Vuyo Ngonyama*, Zanele Radebe*
* Independent non-executive directors
# Lead independent non-executive director


Advisers
Company Secretary: Fusion Corporate Secretarial Services Proprietary Limited
Transfer Secretaries: Link Market Services South Africa

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