Notes to the Financial Statements - Omnicaneomnicane.com/ir2018/static/pdf/Notes to Financial...

Notes to the Financial StatementsYear ended December 31, 2018

08 / Consolidated Financial Statements

1. GENERAL INFORMATION

Omnicane Limited is a public limited liability company incorporated and domiciled in Mauritius. The address of its registered office is Omnicane House, Mon Trésor Business Gateway, New Airport Access Road, Plaine Magnien.

These financial statements will be submitted for consideration and approval at the forthcoming Annual Meeting of Shareholders of the Company.

2. SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparationThe financial statements of Omnicane Limited and its subsidiaries comply with the Companies Act 2001 and have been prepared in accordance with International Financial Reporting Standards (IFRS). The financial statements include the consolidated financial statements of the parent company and its subsidiary companies (The Group) and the separate financial statements of the parent company (The Company). The consolidated financial statements are presented in Mauritian rupees and all values are rounded to the nearest thousand (Rs’000), except where otherwise indicated.

Where necessary, comparative figures have been amended to conform with changes in presentation in the current year. The financial statements are prepared under the historical cost convention, except that:(i) land is carried at revalued amount;(ii) available-for-sale investments are stated

at fair value and(iii) investments held for trading and relevant

financial assets and financial liabilities are stated at their fair value;

(iv) relevant financial assets and financial liabilities are carried at amortised cost; and

(v) consumable biological assets are stated at fair value.

Standards, Amendments to published Standards and Interpretations effective in the reporting period

IFRS 9 replaces the provisions of IAS 39 that relate to the recognition, classification and measurement of financial assets and financial liabilities, derecognition of financial instruments, impairment of financial assets and hedge accounting. The adoption of IFRS 9 Financial Instruments from January 1, 2018 resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. The new accounting policies are set out in note 2.9. The Group has elected to apply the exemption in IFRS 9 paragraph 7.2.15 not to restate prior periods in the year of initial application of the standard. The Group has chosen to adopt the simplified expected credit loss model for trade receivables in accordance with IFRS 9 paragraph 5.5.15.

IFRS 15 Revenue from Contracts with Customers is based on the principle that revenue is recognised when control of a good or service transfers to a customer. The group has adopted IFRS 15 Revenue from Contracts with Customers from January 1, 2018 which resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. The new accounting policies are set out in note 2.2. In accordance with the transition provisions in IFRS 15, the group has not restated comparatives for the 2017 financial year.

Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS 2)The amendments clarify the measurement basis for cash-settled share-based payments and the accounting for modifications that change an award from cash-settled to equity-settled. The amendment has no impact on the Group’s financial statements.

143OMNICANE INTEGRATED REPORT 2018

2. SIGNIFICANT ACCOUNTING POLICIES (cont’d)

2.1 Basis of preparation (cont’d)

Standards, Amendments to published Standards and Interpretations effective in the reporting period (cont’d)

Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts (Amendments to IFRS 4)The amendment provides two different solutions for insurance companies: a temporary exemption from IFRS 9 for entities that meet specific requirements (applied at the reporting entity level), and the ‘overlay approach’. Both approaches are optional. The amendment has no impact on the Group’s financial statements.

Annual Improvements to IFRSs 2014-2016 Cycle

• IFRS 1 - deleted short-term exemptions covering transition provisions of IFRS 7, IAS 19 and IFRS 10 which are no longer relevant.

• IAS 28 - clarifies that the election by venture capital organisations, mutual funds, unit trusts and similar entities to measure investments in associates or joint ventures at fair value through profit or loss should be made separately for each associate or joint venture at initial recognition. The amendment has no impact on the Group’s financial statements.

IFRIC 22 Foreign Currency Transactions and Advance Consideration. The interpretation clarifies how to determine the date of transaction for the exchange rate to be used on initial recognition of a related asset, expense or income where an entity pays or receives consideration in advance for foreign currency-denominated contracts. The amendment has no impact on the Group’s financial statements.

Transfers of Investment Property (Amendments to IAS 40). The amendments clarify that transfers to, or from, investment property can only be made if there has been a change in use that is supported by evidence. A change in use occurs when the property meets, or ceases to meet, the definition of investment property. A change in intention alone is not sufficient to support a transfer. The amendment has no impact on the Group’s financial statements.

Standards, Amendments to published Standards and Interpretations issued but not yet effective

Certain standards, amendments to published standards and interpretations have been issued that are mandatory for accounting periods beginning on or after January 1, 2019 or later periods, but which the Group has not early adopted.

At the reporting date of these financial statements, the following were in issue but not yet effective:

Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28)IFRS 16 LeasesIFRS 17 Insurance ContractsIFRIC 23 Uncertainty over Income Tax TreatmentsPrepayment Features with negative compensation (Amendments to IFRS 9)Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28)Annual Improvements to IFRSs 2015-2017 CyclePlan Amendment, Curtailment or Settlement (Amendments to IAS 19)Definition of a Business (Amendments to IFRS 3)Definition of Material (Amendments to IAS 1 and IAS 8)

Where relevant, the Group is still evaluating the effect of these Standards, amendments to published Standards issued but not yet effective, on the presentation of its financial statements.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 4.

Notes to the Financial Statements (cont’d)

Year ended December 31, 2018



2.2 Revenue recognition

(a) Revenue from contracts with customers

(i) Performance obligations and timing of revenue recognitionThe majority of the revenue is derived from selling goods with revenue recognised at a point in time when control of the goods has transferred to the customer. This is generally when the goods are delivered to the customer. However, for export sales, control might also be transferred when delivered either to the port of departure or port of arrival, depending on the specific terms of the contract with a customer. There is limited judgement needed in identifying the point control passes: once physical delivery of the products to the agreed location has occurred, the Group no longer has physical possession, usually will have a present right to payment and retains none of the significant risks and rewards of the goods in question.

(ii) Sale of goodsRevenue represents the gross proceeds of sugar, molasses and bagasse, the sale of electricity and ethanol, hospitality services and sale of land.

Sugar, molasses and bagasse proceeds are recognised on total production of the crop year. Sugar, molasses and bagasse prices are based on prices recommended by the Mauritius Cane Industry Authority for the crop year after consultation with the Mauritius Sugar Syndicate. The difference between the recommended price and the final price is reflected in the financial year in which it is established.

Sale of electricity and ethanol are recognised when the goods are delivered and titles have passed, at which time all of the following conditions are satisfied:

- the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;

- the Group retains neither continuing managerial involvement to the degree usually associated with the ownership nor effective control over the goods sold;

- the amount of revenue can be measured reliably;

- it is probable that the economic benefits associated with the transaction will flow to the Group and

- the costs incurred or to be incurred in respect of the transaction can be measured reliably.

(iii) Rendering of servicesRevenue from rendering of services are recognised in the accounting year in which the services are rendered (by reference to completion of the specific transaction assessed on the basis of the actual service provided as a proportion of total services to be provided).

The Group has applied the following transitional reliefs in IFRS 15:

• for completed contracts that have variable consideration, the Group has used the transaction price at the date the contract was completed rather than estimating variable consideration in earlier periods. Completed contracts are those for which the Group had completed all its performance obligations prior to the date of transition.

• it has not restated completed contracts that: - begin and end within the same annual

reporting period; or - were completed contracts at the beginning

of the earliest period presented

• for contracts that were modified before the beginning of the earliest period presented, the Group has reflected the aggregate effect of all of the modifications that occurred before the start of the comparative period by:

- identifying the satisfied and unsatisfied performance obligations;

- determining the transaction price; and - allocating the transaction price to

the satisfied and unsatisfied performance conditions.

144 OMNICANE INTEGRATED REPORT 2018 145OMNICANE INTEGRATED REPORT 2018


2.2 Revenue recognition (cont’d)

(a) Revenue from contracts with customers (cont’d)

Determining the transaction priceMost of the revenue is derived from fixed price contracts and therefore the amount of revenue to be earned from each contract is determined by reference to those fixed prices.

Practical Exemptions The Group has taken advantage of the practical exemptions:• not to account for significant financing

components where the time difference between receiving consideration and transferring control of goods (or services) to its customer is one year or less; and

• expense the incremental costs of obtaining a contract when the amortisation period of the asset otherwise recognised would have been one year or less.

(b) Other revenues earned by the Group are recognised on the following bases:

• Royalty income - on an accruals basis in accordance with the substance of the relevant agreements.

• Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).

• Dividend income - when the shareholder’s right to receive payment is established.

• Lease income arising from operating leases-on a straight-line basis over the lease term.

Sale of completed propertyA property is regarded as sold when the significant risks and rewards have been transferred to the buyer, which is normally on unconditional exchange of contracts. For conditional exchanges, sales are recognised only when all the significant conditions are satisified.

Sale of property under developmentWhere the property is under development and agreement has been reached to sell such property when construction is complete, the directors consider whether the contract comprises:• A contract to construct a property or;• A contract for the sale of a completed property.

Where the contract is judged to be for the construction of a property, revenue is recognised using the percentage of completion method as construction progresses.

If, however, the legal terms of the contract are such that the construction represents the continuous transfer of work in progress to the purchaser, the percentage of completion method of revenue recognition is applied and revenue is recognised as work progresses. Continuous transfer of work in progress is applied when:

• The buyer controls the work in progress, typically when the land on which development is taking place is owned by the final customer; and

• All significant risks and rewards of ownership of the work in progress in its present state are transferred to the buyer as construction progresses, typically when the buyer cannot put the incomplete property back to the Group.

In such situations, the percentage of work completed is measured based on the costs incurred up until the end of the reporting period as a proportion of total costs expected to be incurred.


2.3 Exceptional itemsExceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further understanding of the financial performance of the Group. They are material items of income or expense that have been shown separately due to the significance of their nature or amount.

2.4 Hedge accounting

Hedge accounting is applied to financial assets and financial liabilities only where all of the following criteria are met:

- At the inception of the hedge there is formal designation and documentation of the hedging relationship and the Group’s/Company’s a risk management objective and strategy for undertaking the hedge;

- The hedge relationship meets all of the hedge effectiveness requirements including that an economic relationship exists between the hedged item and the hedging instrument, the credit risk effect does not dominate the value changes, and the hedge ratio is designated based on actual quantities of the hedged item and hedging instrument.

(i) Cash flow hedgesThe effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss within finance cost.

Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss.

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to profit or loss within finance cost.

The Group has foreign bank loans (hedge item) denominated in Euro and USD and has its revenue streams (hedge instrument) in Euro and USD. The Group has a cash flow hedge whereby the foreign exchange exposure arising from translation of the bank loan is hedged against the revenue streams.

Exchange differences arising from the translation of the loan is taken to ‘Hedging reserve’. The realised gain/(loss) on repayment of the bank loan is then released to the statement of profit or loss and other comprehensive income.

2.5 Property, plant and equipment

Freehold land is stated at fair value, based on valuations by external independent valuers. Buildings held for use in the production or supply of goods or for administrative purposes, are stated at historical cost, less subsequent depreciation for buildings. All other property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the assets’ carrying amount or recognised as a separate asset as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

Increases in the carrying amount arising on revaluation are credited to other comprehensive income and shown as revaluation surplus in shareholders’ equity. Decreases that offset previous increases of the same asset are charged against revaluation surplus directly in equity; all other decreases are charged to profit or loss.

Properties in the course of construction for production, or administrative purposes or for purposes not yet determined are carried at cost less any recognised impairment loss. Cost includes professional fees and for qualifying assets, borrowing costs capitalised. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.






2.5 Property, plant and equipment (cont’d)

Bearer plants have been estimated based on the cost of land preparation and planting of bearer canes.

Depreciation is calculated on the straight-line method to write off the cost or revalued amounts of the assets, to their residual values over their estimated useful lives as follows:

BuildingsLeasehold propertiesPower, plant and equipmentRefinery plantFactory, plant and equipmentDistillery plantBearer Plants

2 - 2.25 %1% 5 - 7 %5 % 2 - 20 %4 %14 %

Freehold land is not depreciated.

The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively, if appropriate, at the end of each reporting period.

Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.

Gains and losses on disposals of property, plant and equipment are determined by comparing proceeds with carrying amount and are included in profit or loss. On disposal of revalued assets, the amounts included in revaluation surplus relating to that asset are transferred to retained earnings.

2.6 Intangible assets

(a) Computer softwareAcquired computer software licences are capitalised on the basis of costs incurred to acquire and bring to use the specific software and are amortised using the straight line method over their estimated useful lives (3 years).

Costs associated with developing or maintaining computer software are recognised as an expense as incurred. Costs that are directly associated with the production of identifiable and unique software controlled by the Group and that will generate economic benefits exceeding costs beyond one year, are recognised as intangible assets. Direct costs include the software development employee costs and an appropriate portion of relevant overheads.

(b) Goodwill Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any.

Goodwill is tested annually for impairment.

On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gains and losses on disposal.

Goodwill is allocated to cash-generating units for the purpose of impairment testing.

(c) Land conversion rights (i) Blue Print and Early Retirement Scheme CostThe cash compensation together with the costs of land and infrastructure payable under the Blue Print and Early Retirement Scheme is capitalised as land conversion rights. Such costs are charged to profit or loss when the associated benefits related to the special rights to acquire, convert and sell agricultural land are realised. At the end of each financial year, the carrying amount is subject to testing for impairment and reduced to the recoverable amount, if this is less.


2.6 Intangible assets (cont’d)

(c) Land conversion rights (cont’d)

(ii) Sugar Industry Voluntary Retirement Scheme (VRS)

VRS costs (net of refunds under the Multi-Annual-Adaptation Scheme and pension obligations previously provided for) are carried forward on the basis that under the Scheme, the Company acquires the right to sell land on which no conversion taxes are payable. The remaining costs from which no land conversion rights was applied has been revalued at the end of the financial year and treated as intangible assets. At the end of each financial year, the land conversion rights will be tested for impairment.

(d) Energy management contract - The GroupOmnicane Milling Operations Limited acquired the rights to the management contract of Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) Limited, two energy generating entities. This management contract will run for a period of twenty years in line with the provisions of the Purchasing Power Agreement between Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) and the Central Electricity Board. These rights have been recognised as an intangible assets and are amortised over the life of the contract.

Part of the energy management contracts was sold to Omnicane Management and Consultancy Limited in 2017.

(e) Rebranding costIn 2009, the Group completed a rebranding exercise aiming at regrouping all members under a common brand. All costs associated to the rebranding exercise have been capitalised and included as an intangible asset. Rebranding cost is amortised over a period of 20 years, time at which a full review of the brand will be performed.

(f) Bond expensesTransaction costs relating to bond issues have been capitalised and included under intangible assets and are amortised over the life of the bonds, which are 1, 3 and 5 years.

(g) Legal and professional costs in respect of Power Purchase Agreement (PPA)The two energy generating entities, Omnicane Thermal Energy Operations (St Aubin) Limited and Omnicane Thermal Energy Operations (La Baraque) Limited incurred costs in relation to the Power Purchase Agreements (PPA) they both have with the Central Electricity Board. These legal and professional fees have been treated as intangible assets and are amortised over the term of each contract, which are for a 20 year period.

2.7 Investments in subsidiaries

Separate financial statements of the investorIn the separate financial statements of the investor, investment in subsidiary companies are carried at cost. The carrying amount is reduced to recognise any impairment in the value of individual investments.

Consolidated financial statementsSubsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and the ability to affect those returns through its power over the entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any assets or liabilities resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interests in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets.






2.7 Investments in subsidiaries (cont’d)

Consolidated financial statements (cont’d)

The excess of the consideration transferred, the amount of any non-controlling interests in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree (if any) over the fair value of the identifiable net assets acquired is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in the profit or loss as a bargain purchase gain.

Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Transactions with non-controlling interestsThe Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposal to non-controlling interests are also recorded in equity.

Disposal of subsidiariesWhen the Group ceases to have control or significant influence, any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purpose of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

2.8 Investments in associated companies

Separate financial statements of the investorIn the separate financial statements of the investor, investments in associated companies are carried at cost. The carrying amount is reduced to recognise any impairment in the value of individual investments.

Consolidated financial statementsAn associate is an entity over which the Group has significant influence but not control, or joint control, in the financial and operating policies and decisions of the investee. Generally an accompanying shareholding between 20% and 50% of the voting rights is held by the Group in such Companies.

Investments in associates are accounted for using the equity method except when classified as held for sale. Investment in associates is initially recognised at cost as adjusted by post acquisition changes in the Group’s share of the net assets of the associate less any impairment in the value of individual investments.

Any excess of the cost of acquisition and the Group’s share of the net fair value of the associate’s identifiable assets and liabilities recognised at the date of acquisition is recognised as goodwill, which is included in the carrying amount of the investment. Any excess of the Group’s share of the net fair value of identifiable assets and liabilities over the cost of acquisition, after assessment, is included as income in the determination of the Group’s share of the associate’s profit or loss.

When the Group’s share of losses exceeds its interest in an associate, the Group discontinues recognising further losses, unless it has incurred legal or constructive obligation or made payments on behalf of the associate.

Unrealised profits and losses are eliminated to the extent of the Group’s interest in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.


2.8 Investments in associated companies (cont’d)

Consolidated financial statements (cont’d)

Where necessary, appropriate adjustments are made to the financial statements of associates to bring the accounting policies used in line with those adopted by the Group.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.

Dilution gains and losses arising on investments in associates are recognised in profit or loss.

2.9 Financial assets

The Group/Company classifies its financial assets into one of the categories discussed below, depending on the purpose for which the asset was acquired. Other than financial assets in a qualifying hedging relationship, the Group’s accounting policy for each category is as follows:

(i) Amortised costThese assets arise principally from the provision of goods and services to customers (e.g. trade receivables), but also incorporate other types of financial assets where the objective is to hold these assets in order to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest. They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

Impairment provisions for trade receivables are recognised based on the simplified approach within IFRS 9 using the lifetime expected credit losses. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being

recognised within cost of sales in the statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

Impairment provisions for receivables from related parties and loans to related parties are recognised based on a forward looking expected credit loss model. The methodology used to determine the amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the financial asset. For those where the credit risk has not increased significantly since initial recognition of the financial asset, twelve month expected credit losses along with gross interest income are recognised. For those for which credit risk has increased significantly, lifetime expected credit losses along with the gross interest income are recognised. For those that are determined to be credit impaired, lifetime expected credit losses along with interest income on a net basis are recognised.

From time to time, the Group elects to renegotiate the terms of trade receivables due from customers with which it has previously had a good trading history. Such renegotiations will lead to changes in the timing of payments rather than changes to the amounts owed and, in consequence, the new expected cash flows are discounted at the original effective interest rate and any resulting difference to the carrying value is recognised in the statement of comprehensive income (operating profit).

The Group’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents in the statement of financial position.

Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less, and - for the purpose of the statement of cash flows - bank overdrafts. Bank overdrafts are shown within loans and borrowings in current liabilities on the statement of financial position.






2.9 Financial assets (cont’d)

(ii) Fair value through other comprehensive incomeThe Group has investments in listed and unlisted entities which are not accounted for as subsidiaries, associates or jointly controlled entities. For those investments, the Company/Group has made an irrevocable election to classify the investments at fair value through other comprehensive income rather than through profit or loss as the Company/Group considers this measurement to be the most representative of the business model for these assets. They are carried at fair value with changes in fair value recognised in other comprehensive income and accumulated in the fair value through other comprehensive income reserve. Upon disposal any balance within fair value through other comprehensive income reserve is reclassified directly to retained earnings and is not reclassified to profit or loss.

The Group has debt securities whose objective is achieved by both holding these securities in order to collect contractual cash flows and having the intention to sell the debt securities before maturity. The contractual terms of the debt securities give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. They are carried at fair value with changes in fair value recognised in other comprehensive income and accumulated in the fair value through other comprehensive income reserve. Upon disposal any balance within fair value through other comprehensive income reserve is reclassified to profit or loss.

Dividends are recognised in profit or loss, unless the dividend clearly represents a recovery of part of the cost of the investment, in which case the full or partial amount of the dividend is recorded against the associated investments carrying amount.

Purchases and sales of financial assets measured at fair value through other comprehensive income are recognised on settlement date with any change in fair value between trade date and settlement date being recognised in the fair value through other comprehensive income reserve.

2.10 Financial liabilities

The Group classifies its financial liabilities depending on the purpose for which the liability was acquired.

Other than financial liabilities in a qualifying hedging relationship, the Group’s accounting policy for each category is as follows:

Other financial liabilitiesOther financial liabilities include the following items:Bank borrowings and the Group’s bonds, private placements and other loans are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the statement of financial position. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest payable while the liability is outstanding.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the end of the reporting period.

Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest method.


2.11 Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation but are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Any impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

2.12 Biological assets

Bearer biological assets (other than bearer plants) and consumable biological assets are stated at their fair value.

Consumable biological assetsStanding canes are measured at their fair value. The fair value of the standing canes is the present value of the expected net cash flow from the standing canes discounted at the relevant market determined pre-tax rate.

2.13 Current and deferred income tax

Value added taxRevenues, expenses and assets are recognised net of the amount of value added tax except: • where the value added tax incurred on

a purchase of assets or services is not recoverable from the taxation authority, in which case the value added tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

• receivables and payables that are stated with the amount of value added tax included.

The tax expense for the year comprises of current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current taxThe current income tax charge is based on taxable income for the year calculated on the basis of tax laws enacted or substantively enacted by the end of the reporting period.

Deferred taxDeferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, if the deferred income tax arises from initial recognition of an asset or liability in a transaction, other than a business combination, that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for.

Deferred income tax is determined using tax rates that have been enacted or substantively enacted at the reporting date and are expected to apply in the period when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised to the extent that it is probable that the future taxable profit will be available against which deductible temporary differences can be utilised.

Corporate Social ResponsibilityThe Corporate Social Responsibility (“CSR’’) was legislated by Government in July 2009. In terms of the legislation, the Company is required to allocate 2% of its chargeable income of the preceeding financial year to Government approved CSR projects.

The required CSR charge for the current year is recognised as income tax expense in profit or loss. The net amount of CSR fund payable to the taxation authority is included as income tax payable in the statement of financial position.






2.14 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost of coal and molasses in the energy cluster is determined by first-in first-out (FIFO) method. Cost of other inventories is determined by the weighted average method. The cost of finished goods and work in progress comprise of raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity) but exclude borrowing costs. Net realisable value is the estimate of the selling price in the ordinary course of business less the costs of completion and applicable variable selling expenses.

2.15 Land under development

Land under development comprises cost of land to be sold and related infrastructural costs. This expenditure is released to profit or loss to the extent that proceeds are received on the sale of land.

2.16 Non-current assets held for sale

Non-current assets classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell if their carrying amount is recovered principally through a sale transaction rather than through a continuing use. This condition is regarded as met only when the sale is highly probable and the asset is available for immediate sale in its present condition.

Events or circumstances may extend the period to complete the sale beyond one year if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset.

When the Group is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Group will retain a non-controlling interest in its former subsidiary after the sale.

2.17 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as deduction, net of tax, from proceeds.

2.18 Leases

(a) Leases are classified as finance leases where the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease.

(b) Accounting for leases - where the Company is the lesseeFinance leases are capitalised at the lease’s inception at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate of interest on the remaining balance of the liability. Finance costs are charged to profit or loss unless they are attributable to qualifying assets in which case, they are capitalised in accordance with the policy on borrowings costs (see note 2.19)

2.19 Borrowings costs

Borrowings costs directly attributable to the acquisition, construction or production of qualifying assets are capitalised until such time as the assets are substantially ready for their intended use or sale.

2.20 Retirement benefit obligations

Defined benefit planA defined benefit plan is a pension plan that is not a defined contribution plan. Typically defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.


2.20 Retirement benefit obligations (cont’d)

Defined benefit plan (cont’d)

The liability recognised in the statement of financial position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit period.

Remeasurement of the net defined benefit liability, which comprise of actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), is recognised immediately in other comprehensive income in the period in which they occur. Remeasurements recognised in other comprehensive income shall not be reclassified to profit or loss in subsequent period.

The Group determines the net interest expense/(income) on the net defined benefit liability/(asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the net defined benefit liability/(asset), taking into account any changes in the net defined liability/(asset) during the period as a result of contributions and benefit payments. Net interest expense/(income) is recognised in profit or loss.

Service costs comprising of current service costs, past service costs, as well as gains and losses on curtailments and settlements are recognised immediately in profit or loss.

Gratuity on retirementFor employees who are not covered (or who are insufficiently covered by the above pension plans), the net present value of the gratuity on retirement payable under the Employment Rights Act 2008 is calculated by a (qualified) actuary and provided for. The obligations arising under this item are not funded.

2.21 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources that can be reliably estimated will be required to settle the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

2.22 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s financial statements in the year in which the dividends are declared.

2.23 Foreign currencies

(i) Functional and presentation currencyItems included in the financial statements of each of the Group’s entities are measured using Mauritian rupees, the currency of the primary economic environment in which the entity operates ‘functional currency’. The consolidated financial statements are presented in Mauritian rupees, which is the Company’s functional and presentation currency.

(ii) Transactions and balancesForeign currency transactions are translated into the functional currency using the exchange rates prevailing on the date of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss, except when deferred in equity as qualifying cash flow hedge.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit or loss within ‘finance income or cost’.





3. FINANCIAL RISK MANAGEMENT

3.1 Financial risk factors

The Group’s activities are exposed to a variety of financial risks; market risk (including currency risk, price risk and cash flow and fair value interest rate risk), credit risk and liquidity risk.

The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance. The Company uses derivative financial instruments to hedge certain risk exposures.

Financial risk management is carried out by the Treasury Department under policies approved by the Board of Directors. The Treasury Department identifies, evaluates and hedges financial risks in close co-operation with the operating units. The Risk Committee of the Board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and investment of excess liquidity.

(a) Market risk(i) Currency riskThe Group’s activities is mainly in the sugarcane growing and milling, electricity and ethanol production and hospitality services. The market strategy for the sale of raw and refined sugar rests with the Mauritius Sugar Syndicate (MSS) which is responsible for negotiating the sale of the sugar production of the country with potential buyers. The Group invoices its refined sugar in Euro to the MSS and ethanol in USD to Alcogroup S.A, who is the main offtaker for the Ethanol distillery. For electricity production, sale is made solely to the Central Electricity Board (CEB) and is based on a Power Purchase Agreement (PPA) for both energy companies. Coal used for electricity production is purchased in US dollar but its effect is mitigated by the fact that the tariff of electricity sold to the Central Electricity Board is adjusted in respect to changes in exchange rates.


2.23 Foreign currencies (cont’d)

(ii) Transactions and balances (cont’d)

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the date of the transaction.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date the fair value was determined.

(iii) Group companiesThe results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(a) assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;

(b) income and expenses for each statement representing profit or loss and other comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction date, in which case income and expenses are translated at the date of the transactions) and

(c) all resulting exchange differences are recognised in other comprehensive income.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

2.24 Segment reporting

Segment information presented relate to operating segments that engage in business activities for which revenues are earned and expenses incurred.

3. FINANCIAL RISK MANAGEMENT (cont’d)

3.1 Financial risk factors (cont’d)

(a) Market risk (cont’d)

(i) Currency risk (cont’d)

At December 31, 2018, if the Mauritian rupee (MUR) had weakened/strenghthened by 5% against the US Dollar, the GB Pound and the Euro with all other variables held constant, post tax profit and equity would have been Rs’000 9,881 (2017: Rs’000 13,046) higher/lower for the Company, mainly as a result of foreign exchange gains/losses on translation of US Dollar and Euro denominated cash balances and foreign exchange gains/losses on translation of US Dollar and Euro denominated short-term bank facility.

At December 31, 2018, if the MUR had weakened/strenghthened by 5% against the US Dollar, GBP, Euro and ZAR with all other variables held constant, post tax profit would have been Rs’000 66,512 higher/lower (2017: Rs’000 97,905) for the Group following changes in foreign exchange differences on translation of US Dollar, GBP, Euro and ZAR denominated cash balances, trade receivables and bank borrowings.

(ii) Price riskThe Group’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Group manages the equity price risk through diversification. The Group’s Board of Directors reviews and approves all equity investment decisions.

The table below summarises the impact of increases/decreases in the fair value of the investments on the Group’s equity. The analysis is based on the assumption that the fair value had increased/decreased by 5%.

CATEGORIES OF INVESTMENTS: THE GROUP THE COMPANY

Impact on equity2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Available for sale - 14,948 - 312

Financial asset at fair value 11,069 - 94

Commodity price riskThe Group is affected by the price volatility of certain commodities. Its sugar operations are ultimately exposed to the sugar price on the world market, and particularly the EU market. The EU sugar market conditions have deteriorated over the year and has experienced higher volatility since the abolition of production quotas for EU beet sugar producers on October 1, 2017. The Group mitigates this risk through a strategy of diversification of markets and revenue sources. Further the energy operations require the ongoing purchase of coal for power generation. The Group ensures that the coal price volatility risk is adequately mitigated through indexation mechanisms in its Power Purchase Agreements.

THE GROUP

Impact on profit or loss Impact on equity

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Price of Sugar 17 25 17 25

(iii) Sensitivity analysisThe table below summarises the impact of increases/decreases in the price of sugar on the Group. The analysis is based on the assumption that the fair value and the sugar price had increased/decreased by 5%.







(a) Market risk (cont’d)

Limitation of sensitivity analysisSensitivity analysis in respect of market risk demonstrates the effect of a change in a key assumption while other assumptions remain unchanged. In reality, there is a correlation between the assumptions and other factors. It should also be noted that these sensitivities are non-linear, and larger or smaller impacts should not be interpolated or extrapolated from these results.

Sensitivity analysis does not take into consideration that the Group’s assets and liabilities are managed. Other limitations include the use of hypothetical market movements to demonstrate potential risk that only represent the Group’s view of possible near-term market changes that cannnot be predicted with any certainty.

(b) Credit riskCredit risk arises from cash and cash equivalents, contractual cash flows of debt investments carried at amortised cost, at fair value through other comprehensive income (FVOCI), favourable derivative financial instruments and deposits with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables.

Credit risk is managed on a Group basis. For banks and financial institutions, only independently rated parties are accepted.

Risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. The compliance with credit limits by customers is regularly monitored by line management.

Sales to retail customers are required to be settled in cash or using major credit cards, mitigating credit risk. There are no significant concentrations of credit risk, whether through exposure to individual customers, specific industry sectors and/or regions.

The Group’s investments in debt instruments are considered to be low risk investments. The credit ratings of the investments are monitored for credit deterioration.

The amounts presented in the statement of financial position are net of allowance for doubtful receivables, estimated by the Group’s management based on prior experience and the current environment.

The Group’s main debtors are the Mauritius Sugar Syndicate on account of sugar proceeds receivable, the Central Electricity Board for the sale of electricity and Alcogroup for the sale of ethanol.

The Group’s energy cluster’s credit risk is highly mitigated by the fact that accounts receivable from its sole customer, the Central Electricity Board, is guaranteed by the Government.

(c) Liquidity riskLiquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivery of cash or another financial asset.

Prudent liquidity risk management includes maintaining sufficient cash and marketable securities, the availability of funding from an adequate amount of committed credit facilities and the ability to close out market positions. The Group aims at maintaining flexibility in funding by keeping committed credit lines available.

Management monitors rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flow and does not foresee any major liquidity risk over the next two years.

THE GROUP THE COMPANYForecast

2019Rs’000

Actual2018

Rs’000

Forecast2019

Rs’000

Actual2018

Rs’000Opening balance for the period (1,203,724) (1,042,816) (1,123,173) (1,142,110)Cash from/(used in) operating activities 57,972 63,482 (589,093) (838,884)Cash from/(used in) investing activities 640,960 (207,278) 1,442,275 688,957 Cash (used in)/from financing activities (479,371) 5,331 (1,028,124) 169,012 Effect of foreign exchange rate changes 4,902 (22,443) - (148)Closing balance for the period (979,261) (1,203,724) (1,298,115) (1,123,173)

THE GROUPLess than

1 yearRs’000

Between 1 and 2 years

Rs’000


Rs’000

Over 5 yearsRs’000

At December 31, 2018Trade and other payables 1,518,792 - - -Bank borrowings 2,851,815 1,297,735 1,326,440 1,071,582Private placement - - 300,000 2,200,000Bonds 210,000 - 1,590,000 -Finance lease liabilities 24,809 19,773 24,366 -Loan from related party 89,274 -Payable to related parties 132,397 - - -

THE GROUPLess than

1 yearRs’000


Rs’000


Rs’000


At December 31, 2017Trade and other payables 1,029,005 - - -Bank borrowings 2,760,474 1,023,831 2,068,500 557,629Private placement - - 300,000 2,200,000Bonds - 210,000 1,150,000 440,000Finance lease liabilities 26,062 19,542 21,936 -Loan from related party - 14,000 - -Payable to related parties 133,206 - - -



(c) Liquidity risk (cont’d)

Forecasted liquidity reserve as at December 31, 2019 is:

The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date:





THE COMPANYLess than

1 yearRs’000


Rs’000


Rs’000


At December 31, 2018Trade and other payables 516,601 - - -Bank borrowings 1,555,424 449,696 175,000 -Private placement - - 300,000 2,200,000Bonds 210,000 - 1,590,000 -Finance lease liabilities 7,002 5,353 5,731 -Payable to related parties 544,031 - - -

At December 31, 2017Trade and other payables 190,251 - - -Bank borrowings 1,845,240 101,666 - -Private placement - - 300,000 2,200,000Bonds - 210,000 1,150,000 440,000Finance lease liabilities 7,366 5,949 5,631 -Payable to related parties 57,928 - - -



(c) Liquidity risk (cont’d)

3.2 Capital risk management

The Group’s objective when managing capital is to safeguard the Group’s ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders.

The Group sets the amount of capital in proportion to risk. The Group manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Consistently with others in the industry, the Group monitors capital on the basis of the debt-to-adjusted capital ratio. This ratio is calculated as net debt over adjusted capital. Net debt is calculated as total debt (as shown in the statement of financial position) less cash in hand and at bank. Adjusted capital comprises of all components of equity (i.e. share capital, share premium, retained earnings, revaluation surplus and other reserves) other than amounts recognised in equity relating to cash flow hedges.

THE GROUP THE COMPANY2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Total debt (note 31) 11,005,794 10,791,974 6,498,206 6,265,852Less: cash and cash equivalents (note 37(e)) (218,126) (387,644) (12,326) (54,788)Net debt 10,787,668 10,404,330 6,485,880 6,211,064


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Owners’ interest 9,930,284 10,964,991 9,699,193 10,371,930Amount recognised in equity relating to cash flow hedges 13,869 36,426 - -

Adjusted capital 9,944,153 11,001,417 9,699,193 10,371,930

Debt-to-adjusted capital ratio 1.08 0.95 0.67 0.60

There were no changes in the Group’s approach to capital risk management during the year.


3.2 Capital risk management (cont’d)

The debt-to-adjusted capital ratios at December 31, 2018 and December 31, 2017 were as follows:

3.3 Fair value estimation

The fair value of financial instruments traded in active markets is based on quoted market prices at the end of the reporting period. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in level 1. Instruments included in level 1 comprise mainly of quoted equity investments classified as trading securities or available-for-sale.

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Specific valuation techniques used to value financial instruments include:- Quoted market prices or dealer quotes for

similar instruments.- Other techniques, such as discounted cash

flow analysis, are used to determine fair value for the remaining financial instruments.

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair value. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cashflows at the current market interest rate that is available to the Group for similar financial instruments.






3.4 Biological assets

The Group is exposed to fluctuations in the price of sugar and the incidence of exchange rate. The risk affects both the crop proceeds and the fair value of biological assets. The risk is not hedged.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continuously evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

4.1 Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Biological assets(a) Bearer biological assets Bearer biological assets have been estimated

based on the cost of land preparation and planting of bearer canes.

(b) Consumable biological assets - Standing Canes The fair value of consumable biological assets

has been arrived at by discounting the present value of expected net cash flows from standing canes at the relevant market determined pre-tax rate.

The expected cash flows have been computed by estimating the expected crop and the sugar extraction rate and the forecasts of sugar prices which will prevail in the coming year for standing canes. The harvesting costs and other direct expenses are based on the yearly budgets of the Group.

(ii) Fair value of securities not quoted in an active marketThe fair value of securities not quoted in an active market may be determined by the Group using valuation techniques including third party transaction values, earnings, net asset value or discounted cash flows, whichever is considered to be appropriate. The Group would exercise judgement and estimates on the quantity and quality of pricing sources used. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

(iii) Impairment of available-for-sale financial assetsFor the year ended December 31, 2017, the Group follows the guidance of IAS 39 on determining whether an investment is other-than-temporarily impaired. This determination requires significant judgement. In making this judgement, they evaluate, among other factors, the duration and extent to which the fair value of an investment is less than its cost, and the financial health of and near-term business outlook for the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow.

(iv) Recoverability of proceeds from sale of landAt December 31, 2018, management considered the recoverability of proceeds from sale of land under Section 8 of the Land Acquisition Act. Proceeds have been determined on a case to case basis and taking into account the location of the land, surveyors’ report and previous sale of similar properties in the vicinity.

(v) Depreciation policiesProperty, plant and equipment are depreciated to their residual values over their estimated useful lives. The residual value of an asset is the estimated net amount that the Group would currently obtain from the disposal of the asset if the asset was already of the age and in the condition expected at the end of its useful life.

The directors therefore make estimates based on historical experience and use their best judgement to assess the useful lives of assets and to forecast the expected residual values of the assets at the end of their expected useful lives.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

4.1 Critical accounting estimates and assumptions (cont’d)

(vi) Pension benefitsThe present value of the pension obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions will impact the carrying amount of pension obligations.

The Group determines the appropriate discount rate at the end of each year. This is the interest rate that should be used to determine the present value of estimated future cash outflows expected to be required to settle the pension obligations. In determining the appropriate discount rate, the Group considers the interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating the terms of the related pension obligation.

Other key assumptions for pension obligations are based in part on currrent market conditions. Additional information is disclosed in note 32.

(vii) Revaluation of property, plant and equipmentThe Group carries its land at revalued amounts with changes in fair value being recognised in other comprehensive income. The Group engaged independent valuation specialists to determine fair value as at December 31, 2017.

(viii) Limitation of sensitivity analysisSensitivity analysis in respect of market risk demonstrates the effect of a change in a key assumption while other assumptions remain unchanged. In reality, there is a correlation between the assumptions and other factors. It should also be noted that these sensitivities are non-linear and larger or smaller impacts should not be interpolated or extrapolated from these results.

Sensitivity analysis does not take into consideration that the Group’s assets and liabilities are managed. Other limitations include the use of hypothetical market movements to demonstrate potential risk that only represent the Group’s view of possible near-term market changes that cannot be predicted with any certainty.

(ix) Asset lives and residual valuesProperty, plant and equipment are depreciated over its useful life taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In reassessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values. Consideration is also given to the extent of current profits and losses on the disposal of similar assets.





5. REVENUEThe following is an analysis of the Group’s revenue for the year.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Revenue from contract with customers (note 5(a))Sugar, molasses and bagasse 771,998 1,163,281 144,436 165,362Compensation from Sugar Insurance Fund Board 18,943 45,292 14,721 21,767Electricity generation 2,595,728 2,702,318 - -Ethanol 558,317 367,980 - -Hotel revenue 163,196 150,872 - -Property 43,329 43,329 - -Agricultural diversification and others 93,660 66,078 58,191 32,246

4,245,171 4,539,150 217,348 219,375

(a) Disaggregation of revenue from contracts with customers is as follows:

The loss allowance as at December 31, 2018 and January 1, 2018 (on adoption of IFRS 9) was determined as follows for contract assets


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Contract counterpartiesRetailers 27,789 12,142 27,789 12,142Wholesalers 3,944,986 4,278,871 159,157 187,129Direct to consumers 272,396 248,137 30,402 20,104

4,245,171 4,539,150 217,348 219,375Timing of revenue recognitionAt a point in time 4,245,171 4,539,150 217,348 219,375

THE GROUPCurrent

More than 30 days past due


More than 120 days past due Total

At January 1 and December 31, 2018Expected loss rate (%) 0.5 1 5 100 91Gross carrying amount of contract assets (Rs’000) 4,102 270 89 45,044 49,505Loss allowance (Rs’000) 21 3 4 45,044 45,072

THE COMPANYCurrent




At December 31, 2018Expected loss rate (%) 0.5 1 5 100 85Gross carrying amount of contract assets (Rs’000) 4,043 214 89 24,087 28,433Loss allowance (Rs’000) 20 2 4 24,087 24,113


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Depreciation on property, plant and equipment (note 15) 611,972 599,358 48,629 47,680Amortisation of intangible assets (note 16) 32,022 32,613 10,152 11,525Raw materials and consumables used (note 24(i)) 1,759,133 1,781,066 43,754 49,442Employees remuneration (note 8(a)) 701,571 734,075 195,742 209,854Sugar Insurance Fund Board premium 30,716 23,856 12,170 7,964Growing expenses 39,351 62,189 63,505 77,833Milling and refinery expenses 255,040 301,562 - -Lorries and haulage expenses 100,149 126,650 - -Energy expenses 264,500 290,680 - -Ethanol expenses 58,781 21,063 - -Hospitality expenses 37,153 38,027 - -Administrative expenses 373,086 318,952 82,031 69,532

4,263,474 4,330,091 455,983 473,830

CurrentMore than 30 days past due



At January 1, 2018Expected loss rate (%) 0.5 1 5 100 90Gross carrying amount of contract asset (Rs’000) 724 156 1,875 23,973 26,728Loss allowance (Rs’000) 4 2 94 23,973 24,073

The closing loss allowances for trade receivables as at December 31, 2018 reconcile to the opening loss allowances as follows:


Rs’0002018

Rs’000At December 31 (IAS 39) - -Amounts restated through opening retained earnings 45,072 24,073Loss allowance as at January 1, 2018 (IFRS 9) 45,072 24,073Loss allowance recognised in profit or loss during the year - 40At December 31, 2018 45,072 24,113

5. REVENUE (cont’d)

(a) Disaggregation of revenue from contracts with customers is as follows: (cont’d)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Insurance compensation 13,274 544 - -Sundry income 27,062 18,030 - -Management fees 1,000 1,000 1,000 2,150Profit on sale of property, plant and equipment 3,075 2,154 2,013 1,163

44,411 21,728 3,013 3,313

6. OTHER OPERATING INCOME

7. OPERATING EXPENSES






Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Operating profit/(loss) is arrived at after:charging:Depreciation on property, plant and equipment (note 15) 611,972 599,358 48,629 47,680Amortisation of intangible assets (note 16) 32,022 32,613 10,152 11,525Raw materials and consumables used (note 24(i)) 1,759,133 1,781,066 43,754 49,442Impairment loss on financial asset at amortised cost (note 21(b(i)) - - 64 -Employee benefit expense (note 8(a)) 701,571 734,075 195,742 209,854and crediting:Profit on sale of property, plant and equipment (note 6) (3,075) (2,154) (2,013) (1,163)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Wages and salaries 673,763 670,008 162,918 181,802Pension costs and social costs 27,808 64,067 32,824 28,052

701,571 734,075 195,742 209,854


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Interest income 151,362 116,816 383,865 335,291Dividend income 4,787 4,760 134,450 176,826

156,149 121,576 518,315 512,117


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Foreign exchange (gains)/losses (3,287) (86,383) 12,894 13,466Interest expense on:- Bank overdrafts 73,196 81,273 66,679 76,541- Bank and other loans 253,589 341,240 33,214 69,556- Amount payable to related parties 38,189 7,995 8,510 5,009- Private placement 158,066 46,899 158,066 46,899- Finance lease liabilities 4,955 5,555 1,594 1,732- Bonds 107,560 160,392 107,560 160,392

635,555 643,354 375,623 360,129632,268 556,971 388,517 373,595


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Profit on disposal of land 128,360 62,775 128,360 62,775Land debtors written off - (14,367) - (14,367)Reversal of profit on sale on land - (71,218) - (71,218)

128,360 (22,810) 128,360 (22,810)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Profit on disposal of management contract - 56,717 - 36,200Land conversion rights - 201,665 - 89,281Impairment of investment in subsidiary (note 17) - - (39,054) -Project expenses written off - (45,785) - (45,785)

- 212,597 (39,054) 79,696

THE GROUP THE COMPANY

2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Current tax on adjusted profit for the year at 3%/15% (2017: 3%/15%) 25,741 24,568 - -

CSR charge at 2% 444 - - -Underprovision/(overprovision) in previous years 3,111 291 - -Deferred tax (note 23(c)) 47,266 69,334 6,428 (4,709)Tax charge/(credit) for the year 76,562 94,193 6,428 (4,709)

8. OPERATING PROFIT/(LOSS) 11. OTHER NON-OPERATING INCOME/(EXPENSE)

12. EXCEPTIONAL ITEMS

13. TAXATION(a) Charge/(credit) for the year

9. INVESTMENT INCOME

10. FINANCE COSTS

(a) Employee benefit expense


The tax on the Group’s/Company’s loss before taxation differs from the theoretical amount that would arise using the basic tax rate of the Group/Company as follows:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Loss before taxation: (325,768) (232,373) (18,274) (104,530)Tax calculated at 3%/15 % (2017: 3%/15%) (29,319) (16,718) (5,553) (15,680)CSR charge at 2% 444 - - -Income not subject to tax (58,755) (49,366) (56,607) (59,825)Expenses not deductible for tax purposes 87,968 88,842 28,224 31,196Underprovision in previous year 3,111 291 - -Tax losses utilised - (728) - -Tax losses for which no deferred tax recognised 73,113 71,872 40,364 40,364Tax charge/(credit) for the year 76,562 94,193 6,428 (3,945)





Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, (14,909) (10,488) (388) (2,852)Movement during the year:Current tax on the adjusted profit for the year at 3%/15% (2017: 15%) 25,741 24,568 - -

Tax deducted at source (26,246) (19,159) - -CSR charge at 2% 444 - - -CSR for previous year at 2% 1,190 - - -Tax refund 17,561 16,444 - 2,464Underprovision in previous year 3,111 291 - -

21,801 22,144 - 2,464Tax paid (20,950) (26,565) - -At December 31, (14,058) (14,909) (388) (388)Disclosed as follows:Current tax assets (19,589) (20,256) (388) (388)Current tax liabilities 5,531 5,347 - -

(14,058) (14,909) (388) (388)

THE GROUP THE COMPANY2018 2017 2018 2017

Basic loss per share - Rs (6.17) (6.28) (0.37) (1.49)Loss attributable to equityholders of the Company (Rs’000)- As previously stated (413,716) (423,590) (24,702) (100,585)- Effect of prior year adjustment (note 45(d)) - 788 - 764- As restated (413,716) (422,802) (24,702) (99,821)Number of ordinary shares in issue 67,012,404 67,012,404 67,012,404 67,012,404

13. TAXATION (cont’d)

(b) Current tax (assets)/liabilities

14. LOSS PER SHARE

15. PROPERTY, PLANT AND EQUIPMENT(a) THE GROUP


THE GROUP Freehold land

Rs’000Buildings

Rs’000

Leasehold properties

Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000

Work in progressRs’000

Bearer plantsRs’000

TotalRs’000

2018

Valuation/Cost 8,836,848 1,065,526 109,789 6,386,036 995,142 1,859,390 2,030,709 245,641 527,873 22,056,954Accumulated depreciation - (201,378) (19,018) (3,025,351) (428,872) (597,801) (701,547) - (385,680) (5,359,647)

Net book value 8,836,848 864,148 90,771 3,360,685 566,270 1,261,589 1,329,162 245,641 142,193 16,697,307

2017

Valuation/Cost 8,834,423 987,789 111,346 5,222,937 995,142 1,684,531 1,948,298 1,124,105 490,195 21,398,766Accumulated depreciation - (177,783) (11,702) (2,747,926) (428,872) (524,843) (509,458) - (347,091) (4,747,675)

Net book value 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091

NET BOOK VALUE


Rs’000Buildings

Rs’000


Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000



TotalRs’000

2018

At January 1, 2018

- As previously stated 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091- Effect of changes in

accounting policies(note 45(c))

8,897 - - - - - - - - 8,897

- As restated 8,843,320 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,659,988

Revaluation (850) - - - - - - - - (850)

Additions 3,951 77,737 2,905 264,461 - 10,650 87,111 184,004 37,678 668,497

Disposals (16,134) - (4,462) - - - (9,284) - - (29,880)

Depreciation - (23,595) (7,316) (277,425) - (72,958) (192,089) - (38,589) (611,972)

Transfers - - - 898,638 - 164,209 - (1,062,847) - -Transfer to non-current assets held for sale (note 28)

(4,999) - - - - - - - - (4,999)

Transfer to deferred project - - - - - - - 379 - 379

Consolidation adjustment 11,560 - - - - - 4,584 - - 16,144

At December 31, 2018 8,836,848 864,148 90,771 3,360,685 566,270 1,261,589 1,329,162 245,641 142,193 16,697,307




NET BOOK VALUE


Rs’000Buildings

Rs’000


Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000



TotalRs’000

2017

At January 1, 2017 6,272,889 815,925 106,755 2,717,817 626,026 1,196,861 1,479,254 870,708 144,216 14,230,451

Revaluation surplus 2,558,707 - - - - - - - - 2,558,707

Additions - 5,616 793 29,908 - 32,267 89,557 228,706 38,562 425,409

Disposals (15,962) - - (8) - - (6,730) - - (22,700)

Depreciation - (22,524) (7,904) (272,706) (59,756) (69,440) (127,354) - (39,674) (599,358)Transfer from intangi-ble assets (note 16) - - - - - - 2,901 - - 2,901

Transfer to intangible assets (note 16) - - - - - - - (114) - (114)

Transfer from non-current asset held for sale (note 28)

7,158 - - - - - - - - 7,158

Transfer from deferred project expenses - - - - - - - 11,362 - 11,362

Consolidation adjustment 14,493 - - - - - - - - 14,493

Transfer from Land debtors 11,793 10,989 - - - - - - - 22,782

Transfers (14,655) - - - - - 1,212 13,443 - -

At December 31, 2017 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091


NET BOOK VALUE

THE COMPANYFreehold

landRs’000

BuildingsRs’000


Rs’000

Plant and equipment

Rs’000Bearer plants

Rs’000Total

Rs’0002018At January 1, 2018- As previously reported 5,054,705 75,532 2,467 52,859 104,285 5,289,848- Effect of changes in accounting policies ( note 45(c)) 519 - - - - 519- As restated 5,055,224 75,532 2,467 52,859 104,285 5,290,367Additions - 64,040 - 11,440 30,127 105,607Disposals (511) - - (1,919) - (2,430)Transfer from non-current asset held for sale (note 28) (4,999) - - - - (4,999)Depreciation - (4,147) - (15,834) (28,648) (48,629)At December 31, 2018 5,049,714 135,425 2,467 46,546 105,764 5,339,916

2017At January 1, 2017 4,398,794 64,010 2,467 60,448 105,092 4,630,811Additions - 2,480 - 9,510 28,392 40,382Disposals (10,496) - - (565) - (11,061)Transfer from non-current asset held for sale (note 28) 7,158 - - - - 7,158Transfer from Land debtors 11,792 10,989 - - - 22,781Depreciation - (1,947) - (16,534) (29,199) (47,680)Revaluation surplus 647,457 - - - - 647,457At December 31, 2017 5,054,705 75,532 2,467 52,859 104,285 5,289,848

THE COMPANY Freehold landRs’000

BuildingsRs’000


Rs’000

Plant and equipment

Rs’000Bearer plants

Rs’000Total

Rs’0002018Valuation/Cost 5,049,714 167,981 4,915 344,246 361,992 5,928,848Accumulated depreciation - (32,556) (2,448) (297,700) (256,228) (588,932)Net book value 5,049,714 135,425 2,467 46,546 105,764 5,339,916

2017Valuation/Cost 5,054,705 103,941 4,915 334,725 331,865 5,830,151Accumulated depreciation - (28,409) (2,448) (281,866) (227,580) (540,303)Net book value 5,054,705 75,532 2,467 52,859 104,285 5,289,848

(c) Depreciation charge of Rs’000 611,972 (2017: Rs’000 599,358) for the Group and Rs’000 48,629 (2017: Rs’000 47,680) for the Company has been included under operating expenses.



15. PROPERTY, PLANT AND EQUIPMENT (cont’d)

(b) THE COMPANY (cont’d)


(a) THE GROUP (cont’d)

(b) THE COMPANY


There were no transfers between levels during the year.

The fair value of land is classified in level 2 of the fair value hierarchy as it has been valued using observable market date but there is no active market.

In evaluating property to assess its estimate of likely value, the professional valuer has three approaches from which to select: the income capitalisation, cost and sales comparison approaches.

For the purpose of this valuation, the Sales Comparison Approach and the Depreciated Replacement Cost Approach have been used.

At December 31, 2018, the most significant observable inputs for the valuation of land are as follows:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At December 31,Freehold land Level 2 8,836,848 8,834,423 5,049,714 5,054,705

Range of observable inputRs’000/Ha

THE GROUPPrice per hectare 749 - 47,504THE COMPANYPrice per hectare 749 - 43,710


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Additions 668,497 425,409 105,607 40,382Additions under finance lease (32,317) (18,906) (7,670) (3,806)

636,180 406,503 97,937 36,576


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Cost - capitalised finance lease 242,758 210,441 42,813 41,283Accumulated depreciation (112,638) (104,599) (26,203) (23,447)Net book value 130,120 105,842 16,610 17,836


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Level 2At January 1,- As previously reported 8,834,423 6,272,889 5,054,705 4,398,794- Effect of changes in accounting policies ( note 45(c)) 8,897 - 519 -- As restated 8,843,320 6,272,889 5,055,224 4,398,794Consolidation adjustment 11,560 - - -Revaluation (850) - - -Additions 3,951 - - -Disposals (16,134) (15,962) (511) (10,496)Transfer from non-current assets held for sale (4,999) 7,158 - 7,158Transfer from land debtors - 11,793 (4,999) -Consolidation adjustment - 14,493 - -Transfers - (14,655) - 11,792Surplus on revaluation - 2,558,707 - 647,457At December 31, 8,836,848 8,834,423 5,049,714 5,054,705


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At December 31,Freehold land 947,292 944,422 919,845 920,356


(d) If the freehold land was stated on the historical cost basis, the amounts would be as follows:


(e) Significant increase/(decrease) in the above observable input, price per Hectare (Ha) in isloation would result in a significant higher/(lower) fair value.

The movement in the opening balance and closing balance of the property, plant and equipment categorised within level 2 of the fair value hierarchy is as follows:

(e) The Group’s/Company’s freehold land were last revalued at December 31, 2017 by Broll, independent valuers. The revaluation surplus net of applicable deferred income taxes was credited to revaluation surplus in shareholders’ equity (note 30).

The fair value of the land is based on its market value, which is defined as intended to mean the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion.

Details of the Group’s/Company’s freehold land measured at fair value and information about the fair value hierarchy as at December 31, 2018 is as follows:


(f) Borrowings are secured by floating charges on the assets of the Company or its subsidiaries, including property, plant and equipment (note 31).

(g) Non-cash transactions

(h) Assets under finance lease comprise transport equipment:




Software and profesional

feesRs’000

GoodwillRs’000

Land conver-sion rights

Rs’000

Energy management

contractsRs’000

Bond expenseRs’000

Rebranding costs

Rs’000Total

Rs’000

COSTAt January 1, 2017 114,768 77,424 1,081,511 555,200 75,549 11,333 1,915,785Additions 5,864 - 413,489 - 25,948 - 445,301Disposals - - - (257,782) - - (257,782)Transfer from property, plant and equipment (note 15) - - - - - 114 114 Transfer to property, plant and equipment (note 15) (3,053) - - - - - (3,053)At December 31, 2017 117,579 77,424 1,495,000 297,418 101,497 11,447 2,100,365Additions - net 9,890 - - - - - 9,890At December 31, 2018 127,469 77,424 1,495,000 297,418 101,497 11,447 2,110,255

AMORTISATIONAt January 1, 2017 65,998 - 12,564 134,277 41,551 5,733 260,123Transfer to property, plant and equipment (note 15) (152) - - - - - (152)Charge for the year 8,478 - - 13,595 9,973 567 32,613At December 31, 2017 74,324 - 12,564 147,872 51,524 6,300 292,584Charge for the year 9,202 - - 13,595 8,526 699 32,022At December 31, 2018 83,526 - 12,564 161,467 60,050 6,999 324,606

NET BOOK VALUEAt December 31, 2018 43,943 77,424 1,482,436 135,951 41,447 4,448 1,785,649

At December 31, 2017 43,255 77,424 1,482,436 149,546 49,973 5,147 1,807,781

Land conversion

rightsRs’000

Rebranding costs

Rs’000

Energy management

contractsRs’000

Bond expenses

Rs’000OthersRs’000

TotalRs’000

COSTAt January 1, 2017 - 1,039 219,500 75,548 17,008 313,095Additions 301,118 - - 25,947 1,501 328,566Disposals - - (219,500) - - (219,500)At December 31, 2017 301,118 1,039 - 101,495 18,509 422,161Additions - - - - 162 162At December 31, 2018 301,118 1,039 - 101,495 18,671 422,323

AMORTISATIONAt January 1, 2017 - 416 - 41,552 14,318 56,286Charge for the year - 52 - 9,973 1,500 11,525At December 31, 2017 - 468 - 51,525 15,818 67,811Charge for the year - 52 - 8,526 1,574 10,152At December 31, 2018 - 520 - 60,051 17,392 77,963

NET BOOK VALUEAt December 31, 2018 301,118 519 - 41,444 1,279 344,360

At December 31, 2017 301,118 571 - 49,970 2,691 354,350


16. INTANGIBLE ASSETS

(a) THE GROUP

16. INTANGIBLE ASSETS (cont’d)

(b) THE COMPANY

(c) Amortisation charge of Rs’000 32,022 (2017: Rs’000 32,613) for the Group and Rs’000 10,152 (2017: Rs’000 11,525) for the Company has been included under operating expenses.

(d) Goodwill is allocated to the cash generating units. The carrying amount of goodwill had been allocated as follows:

THE GROUP

2018 and 2017Rs’000

Floréal Limited 427Omnicane Agricultural Operations Limited 20,152Omnicane Milling Holdings (Britannia Highlands) Limited 6,077Omnicane Thermal Energy Holdings (St Aubin) Limited 46,597Refad Rwanda Ltd 4,171

77,424




THE COMPANY 2018Rs’000

2017Rs’000

COSTAt January 1, 4,947,661 4,946,561Additions 100,000 1,100Impairment (note 12) (39,054) -At December 31, 5,008,607 4,947,661


17. INVESTMENT IN SUBSIDIARY COMPANIES

2018 2017% Holding Amount % Holding Amount

CompaniesTypes of

shares held ActivityHeld

directly

Held by other group companies Rs’000 Held directly

Held by other group companies Rs’000

Direct HoldingOmnicane Milling Holdings (Mon Trésor) Limited Ordinary Investment 80 - 118,242 80 - 118,242

Omnicane Milling Holdings (Britannia Highlands) Limited Ordinary Investment 80 - 272,037 80 - 272,037

Floréal Limited Ordinary Investment 100 - 3,188 100 - 3,188

FAW Investment Limited Ordinary Investment 100 - 148,205 100 - 148,205Omnicane Logistic Operations Limited Ordinary Transport 100 - 150,000 100 - 50,000

Omnicane Thermal Energy Holdings (St Aubin) Limited Ordinary Investment 100 - 287,271 100 - 287,271

Omnicane Holdings (La Baraque) Thermal Energy Limited Ordinary Investment 100 - 535,221 100 - 535,221

Omnicane Wind Energy Limited Ordinary Energy 100 - 0.1 100 - 0.1Omnicane Britannia Wind Farm Operations Limited Ordinary Energy 100 - 0.1 100 - 0.1

Omnicane Ethanol Holdings Limited Ordinary Investment 60 - 105,155 60 - 105,155

Airport Hotel Ltd Ordinary Hotel 51 10 174,120 51 10 213,174

Omnicane Africa Investment Ltd Ordinary Investment 100 - 1 100 - 1La Baraque Maintenance And Services Ltd Ordinary Security 100 - 1 100 - 1

Omnicane International Invest-ment Co Ltd Ordinary Investment 100 - 525,033 100 - 525,033

Omnicane Hydro Energy Limited Ordinary Management 100 - 100 100 - 100

Blueport Investment Limited Ordinary Real Estate 100 - 100 100 - 100

Mon Trésor Smart City Ltd Ordinary Real Estate 100 - 2,684,197 100 - 2,684,197Mon Trésor Smart City Management Ltd Ordinary Real Estate 100 - 100 100 - 100

Omnicane Sugar Trading Ltd Ordinary Sale of refined sugar 100 - 100 100 - 100

Mon Trésor Retail Ltd Ordinary Retail 100 - 100 100 - 100Mon Trésor Business Gateway Phase 1 Ltd Ordinary Real Estate 100 - 1,000 100 - 1,000

Refad Rwanda Ltd Ordinary Energy 51 - 4,436 51 - 4,436

Mon Trésor Gateway Ltd * Ordinary Real Estate 100 - 1,000 - - 1,000

5,009,607 4,948,661

(a) Subsidiaries of Omnicane Limited

17. INVESTMENT IN SUBSIDIARY COMPANIES (cont’d)

(a) Subsidiaries of Omnicane Limited (cont’d)

2018 2017% Holding Amount % Holding Amount

CompaniesTypes of

shares held ActivityHeld

directly

Held by other group companies Rs’000 Held directly

Held by other group companies Rs’000

Indirect HoldingOmnicane Milling Operations Limited Ordinary Sugar Milling - 80 390,888 - 80 390,888

Omnicane Agricultural Operations Limited Ordinary Sugar Growing - 100 10,400 - 100 10,400

Omnicane Thermal Energy Operations (St Aubin) Limited Ordinary Energy - 60 153,000 - 60 153,000

Omnicane Thermal Energy Operations (La Baraque) Limited Ordinary Energy - 60 456,600 - 60 456,600

Thermal Valorisation Co Ltd Ordinary Energy - 65 191,100 - 65 191,100

Omnicane Ethanol Production Ltd Ordinary Ethanol - 100 10 - 100 10Omnicane Bio-Ethanol Operations Limited Ordinary Ethanol - 100 142,368 - 100 142,368

Omnicane Heat and Power Services Ltd Ordinary Energy - 100 200,000 - 100 200,000

Trade Park Mon Trésor Limited Ordinary Real Estate - 100 520,933 - 100 520,933Mon Trésor Residences Phase 1 Ltd Ordinary Real Estate - 100 1 - 100 1

Mon Trésor Development and Training Center Ltd Ordinary Investment - 100 100,000 - 100 100,000

Mon Trésor Gateway Ltd * Ordinary Real Estate 100 - 1,000 - - -Mon Trésor Studio Operations & Management Ltd * Ordinary Cinemato-

graphy - 100 1,000 - - -

Mon Trésor Studio Property Ltd * Ordinary Real Estate - 100 1,000 - - -

The financial statements of all the above subsidiaries, included in the consolidated financial statements, are co-terminous with those of the holding company. Except for FAW Investment Limited, which is incorporated in the Isle of Man and Refad Rwanda Ltd, incorporated in Rwanda, all the subsidiary companies are incorporated in the Republic of Mauritius.

* Acquisition of subsidiaries during the year.




Profit/(loss) allocated to non-controlling interests

during the yearRs’000

Accumulated non-controlling interests at

December 31,Rs’000

2018Omnicane Ethanol Holdings Limited 19,166 221,970 Omnicane Thermal Energy Operations (St Aubin) Limited 38,786 239,598 Omnicane Thermal Energy Operations (La Baraque) Limited 57,788 479,402 Omnicane Milling Operations Limited (73,104) 40,017 Airport Hotel Ltd (9,461) 105,150

2017Omnicane Ethanol Holdings Limited 76,191 273,634 Omnicane Thermal Energy Operations (St Aubin) Limited 36,995 241,948 Omnicane Thermal Energy Operations (La Baraque) Limited 70,783 479,084 Omnicane Milling Operations Limited (61,338) (50,657)Airport Hotel Ltd (9,324) 86,438


(b) Subsidiaries with material non-controlling interests

Details of subsidiaries that have non-controlling interests that are material to the entity:

(c) Summarised financial information on subsidiaries with material non-controlling interests

(i) Summarised statements of financial position and statements of profit or loss and other comprehensive income


Current assetsRs’000

Non- current assetsRs’000

Current liabilitiesRs’000

Non- current

liabilitiesRs’000

RevenueRs’000

Profit/(loss) for the year

Rs’000

Other comprehensive income for the

yearRs’000

Total comprehensive income for the

yearRs’000

Dividend paid to non-

controlling interestsRs’000

2018Omnicane Ethanol Holdings Limited 166,571 1,033,052 307,065 336,912 558,316 47,915 (6,198) 41,717 -

Omnicane Thermal Energy Operations (St Aubin) Limited 483,560 676,596 373,297 187,902 939,602 96,965 (2,450) 94,515 (30,000)

Omnicane Thermal Energy Operations (La Baraque) Limited

924,498 2,407,138 1,381,418 751,714 1,645,462 144,471 (1,869) 142,602 (60,000)

Omnicane Milling Operations Limited 326,729 2,930,787 2,449,942 607,488 606,642 (365,521) 26,890 (338,631) -

Airport Hotel Ltd 30,617 704,430 255,253 265,200 158,036 (19,308) 12,264 (7,044) -

2017Omnicane Ethanol Holdings Limited 216,560 1,064,665 384,573 378,206 367,980 191,874 39,927 231,801 -

Omnicane Thermal Energy Operations (St Aubin) Limited 486,007 715,269 304,496 301,664 896,675 95,187 (143) 95,044 (36,000)

Omnicane Thermal Energy Operations (La Baraque) Limited

1,028,975 3,671,359 910,192 2,305,968 2,048,145 178,748 21,955 200,703 (80,000)

Omnicane Milling Operations Limited 439,658 3,442,609 3,194,123 713,950 854,328 (306,690) (51,320) (358,009) -

Airport Hotel Ltd 36,985 724,817 210,651 328,374 161,412 (23,268) 10,699 (12,569) -


(c) Summarised financial information on subsidiaries with material non-controlling interests (cont’d)

(ii) Summarised cash flow information

18. INVESTMENT IN ASSOCIATED COMPANIES

Operating activitiesRs’000

Interesting activitiesRs’000

Financing activitiesRs’000

Net increase/(decrease) in

cash and cash equivalents

Rs’0002018Omnicane Ethanol Holdings Limited 74,466 (7,480) (59,995) 6,991Omnicane Thermal Energy Operations (St Aubin) Limited 153,816 (52,123) (177,313) (75,620)Omnicane Thermal Energy Operations (La Baraque) Limited 314,550 (87,353) (315,859) (88,662)Omnicane Milling Operations Limited 131,969 (118,552) (54,489) (41,072)Airport Hotel Ltd 62,563 (7,517) (53,850) 1,196

2017Omnicane Ethanol Holdings Limited (8,048) (9,248) (85,703) (102,999)Omnicane Thermal Energy Operations (St Aubin) Limited 188,140 31,947 (235,486) (15,399)Omnicane Thermal Energy Operations (La Baraque) Limited 445,336 (50,383) (436,837) (41,884)Omnicane Milling Operations Limited 191,920 (101,946) (33,376) 56,598Airport Hotel Ltd (10,331) (1,635) (53,893) (65,859)

The summarised financial information above is the amount before intra-group eliminations.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1,- As previously reported 964,672 1,060,957 11,463 11,463- Effect of prior year changes (note 45) (882,875) - (6,176) -- As restated 81,797 1,060,957 5,287 11,463Additions - 43,329 - -Share of loss in associates (1,953) (155,950) - -Share of other comprehensive income - 16,336 - -At December 31, 79,844 964,672 5,287 11,463




Name Year end

Principle place of business Nature of business

Direct Interest

%

Indirect Interest

%AssetsRs’000

LiabilitiesRs’000

RevenueRs’000

Profit/(loss)Rs’000

2018

Maref Mon Trésor Investment 1 Ltd December 31, Mauritius Real Estate - 19.76 176,267 202,046 12,568 3,047

Kwale International Sugar Company Limited**

December 31, Kenya Sugar Growing - 20.00 12,297,837 7,732,421 1,153,567 (355,251)

Coal Terminal (Management) Co. Ltd December 31, Mauritius Distributor of coal - 24.43 20,768 17,254 82,376 236

Copesud (Mauritius) Ltée December 31, Mauritius Agricultural products 25.00 - 46,420 19,941 67,341 6,156

2017

Maref Mon Trésor Investment 1 Ltd December 31, Mauritius Real Estate - 19.76 387,093 346,265 - (2,577)

Kwale International Sugar Company Limited**

December 31, Kenya Sugar Growing - 20.00 10,496,782 10,980,913 339,497 25,772

Coal Terminal (Management) Co. Ltd December 31, Mauritius Distributor of coal - 24.43 28,365 25,088 73,652 540

Copesud (Mauritius) Ltée December 31, Mauritius Agricultural products 25.00 - 42,075 21,751 60,832 1,406

The Real Good Food plc* March 31, United

KingdomManufacturer and distributor of food & industrial ingredients

- 27.96 7,009,007 3,204,567 2,901,302 (314,070)

All of the above associates are accounted for using the equity method.

* For group accounts purpose, unaudited figures for the period ended September 30, 2017 have been used. At January 1, 2018, the investment has been reassessed under IFRS 9 and has been transferred to investment in financial asset at fair value through Other Comprehensive Income (note 19).

** For group accounts purpose, audited figures for the year ended December 31, 2016 have been used (2017: year ended December 31, 2015).


Rs’0002018

Rs’000At January 1 1,181,831 4,481Additions - 800,000Disposals (3,648) (3,648)Change in fair value recognised in other comprehensive income (85,067) 3At December 31 1,093,116 800,836


Rs’0002018

Rs’000Quoted:Equity securities – [Mauritius] 221,425 32Equity securities – [United Kingdom] 749,174 -Debt securities 121,713 -Unquoted:Equity securities - [Mauritius] 804 800,804

1,093,116 800,836

18. INVESTMENT IN ASSOCIATED COMPANIES (cont’d)

(i) The results of the following associated companies have been included in the consolidated financial statements:

19. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (a) Equity investments at fair value through other comprehensive income


(b) Fair value through other comprehensive income financial assets include the following:

(c) Financial assets measured at fair value through other comprehensive income include the Group’s strategic equity investments not held for trading and debt securities held to collect and sell. The Group has made an irrevocable election to classify the equity investments at fair value through other comprehensive income rather than through profit or loss because this is considered to be more appropriate for these strategic investments. In 2017, the Group had designated the investments as available-for-sale (note 20) where management intended to hold them for the medium to long-term.

(d) The fair value of quoted securities is based on published market prices. The fair value of the unquoted securities are based on expected cash flows discounted using a rate based on the market interest rate and the risk premium specific to the unlisted securities.





Rs’0002018

Rs’000Quoted:ENL Limited 221,383 -The Real Good Food plc 749,174 -Ireland Blyth Limited 30 30Sun Resort Limited 2 2Mauritius Commercial Bank Ltd - 6% 10 years loan notes 60,806 -State Bank of Mauritius - 6% Class A bonds 60,917 -Unquoted:Rey & Lenferna Ltd 802 802Omnicane Foundation Ltd 2 2Omnicane Milling Operations Limited ( Class B Shares) - 800,000

1,093,116 800,836

2017

THE GROUPLevel 1Rs’000

Level 2Rs’000

Level 3Rs’000

TotalRs’000

At January 1, 124,455 141,029 6,226 271,710Change in fair value (146) 29,152 - 29,006Write offs - - (1,760) (1,760)At December 31, 124,309 170,181 4,466 298,956

2017

THE COMPANYLevel 1Rs’000

Level 3Rs’000

TotalRs’000

At January 1, 16 6,221 6,237Change in fair value 4 - 4Write offs - (1,760) (1,760)At December 31, 20 4,461 4,481


Rs’0002017

Rs’000Debt securities at fair value:- Listed 124,292 -Equity Securities at fair value:- Listed 170,203 20- Unlisted 4,461 4,461

298,956 4,481

20. INVESTMENT IN FINANCIAL ASSETS

Available-for-sale

(a) The movements in investments in financial assets may be summarised as follows:

20. INVESTMENT IN FINANCIAL ASSETS (cont’d)

Available-for-sale (cont’d)

(a) The movements in investments in financial assets may be summarised as follows: (cont’d)

(b) Available-for-sale financial assets includes the following:

(c) At December 31, 2017, the directors reviewed the carrying amounts of unquoted investments and in their opinion, there is no objective evidence that the investments should be impaired.

(d) Available-for-sale financial assets are denominated in Mauritian rupee.

(e) All the debt have fixed coupon rates (fixed rate at 6%).

(f) None of the financial assets are either past due or impaired.


19. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (cont’d)

(e) Fair value through other comprehensive income financial assets include the following:

(f) Financial asset at fair value through Other Comprehensive Income are denominated in Mauritian rupee.

(g) Impairment and risk exposureAll of the entity’s debt investments at fair value through Other Comprehensive Income are considered to have low credit risk and the loss allowance recognised during the period was therefore limited to 12 months expected losses.

The loss allowance for debt investments at fair value through Other Comprehensive Income is recognised in profit or loss and reduces the fair value loss otherwise recognised in Other Comprehensive Income. At January 1 and December 31, 2018, the identified impairment loss was immaterial.

THE GROUP2018

THE COMPANY2018

Non-currentRs’000

CurrentRs’000

Non-currentRs’000

CurrentRs’000

Receivable from related parties 1,213,080 1,284,722 2,018,770 3,912,923Other receivables (note 21(a))- Land under development - 382,783 - 382,783- Deferred project expenses 195,403 - 14,957 -- Prepayments and other receivables - 463,836 - 48,566

1,408,483 2,131,341 2,033,727 4,344,272Less: Loss allowance for financial assets at amortised cost (note 21(b)) (345,210) (45,072) (466,011) (24,113)

1,063,273 2,086,269 1,567,716 4,320,159

21. FINANCIAL ASSETS AT AMORTISED COST




(a) Non-current receivables are disclosed under financial assets at amortised cost (note 21) for 2018. In 2017, long term receivables with fixed maturity terms were measured at amortised cost using the effective interest rate method, less provision for impairment. The carrying amount of the asset was reduced by the difference between the asset’s carrying amount and the present value of estimated cash flows discounted using the original effective interest rate. The amount of loss was recognised in profit or loss. If there were objective evidence that an impairment loss had been incurred, the amount of impairment loss was measured as the difference between the carrying amount of the asset and the present value (PV) of estimated cash flows discounted at the current market rate of return of similar financial assets.

(b) For the Group, non-current receivables in respect of loan amount to Kwale International Sugar Company Limited, an associated company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(i) For the Company, non-current receivables in respect of loan amount to Omnicane Africa Investment Limited, a wholly owned subsidiary company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(ii) The carrying amounts of the loans for both the Group and the Company approximates their fair values.

(a) Other receivables These amounts generally arise from transactions outside the usual operating activities of the Company. Interest may be charged at commercial rates where the terms of repayment exceed six months. Collateral is not normally obtained. The non-current other receivables are due and payable other one year from the end of the reporting period.

(b) Impairment and risk exposure

(i) The loss allowance for financial assets at amortised cost as at December 31, 2017 reconciles to the opening loss allowance on January 1, 2018 and to the closing loss allowance as at December 31, 2018 as follows:

(ii) All of the financial assets at amortised cost are denominated in Mauritian rupees. As a result, there is no exposure to foreign currency risk. There is also no exposure to price risk as the investments will be held to maturity.

(c) For the Group, non-current receivables in respect of loan amount to Kwale International Sugar Company Limited, an associated company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

THE GROUP Related partiesRs’000

Other receivablesRs’000

TotalRs’000

Loss allowance at 31 December 2017 (IAS 39) - - -Amounts restated through opening retained earnings 345,210 45,072 390,282Loss allowance at January 1, 2018 (IFRS 9) 345,210 45,072 390,282Allowance recognised in profit or loss during the year - - -Loss allowance at December 31, 2018 345,210 45,072 390,282

THE COMPANY Related partiesRs’000

Other receivablesRs’000

TotalRs’000

Loss allowance at 31 December 2017 (IAS 39) - - -Amounts restated through opening retained earnings 466,011 24,073 490,084Loss allowance at January 1, 2018 (IFRS 9) 466,011 24,073 490,084Allowance recognised in profit or loss during the year 24 40 64Loss allowance at December 31, 2018 466,035 24,113 490,148

(d) For the Company, non-current receivables in respect of loan amount to Omnicane Africa Investment Limited, a wholly owned subsidiary company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(e) The carrying amounts of the loans for both the Group and the Company approximates their fair values.

(f) The other financial assets at amortised cost were accounted for as receivables in the previous year.

22. NON-CURRENT RECEIVABLESTHE GROUP THE COMPANY

2017Rs’000

2017Rs’000

As at January 1, 1,027,839 1,167,670Additions 54,493 117,380Gain on retranslation of non-current receivables 95,623 -

1,177,955 1,285,050

21. FINANCIAL ASSETS AT AMORTISED COST (cont’d)


23. DEFERRED TAX (ASSETS)/LIABILITIES

Deferred income tax is calculated on all temporary differences under the liability method at 3%/17% (2017: 3%/15%).

(a) There is a legally enforceable right to offset current tax assets against current tax liabilities and deferred income tax assets and liabilities when the deferred income taxes relate to the same fiscal authority on the same entity.

The following amounts are shown on the statements of financial position:


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Deferred tax assets (75,894) (93,639) (18,045) (26,159)Deferred tax liabilities 374,242 342,725 - -

298,348 249,086 (18,045) (26,159)




At the end of the reporting year, the Group had unused tax losses of Rs’000 1,736,330 (2017: Rs’000 1,818,838) and the Company had unused tax losses of Rs’000 303,837 (2017: Rs’000 303,837) available for offset against future profits. Deferred tax assets have been recognised in respect of Rs’000 1,148,634 (2017: Rs’000 1,323,620) for the Group and for the Company Rs’000 34,740 (2017: Rs’000 34,740) of such losses. No deferred tax asset has been recognised in respect of the remaining tax losses for the Group due to unpredictability of future profit stream.

As at December 31, 2018, the unused tax losses are classified as follows:


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Unused tax losses at end of the reporting date 1,736,330 1,818,838 303,837 303,837Deferred tax assets recognised on tax losses 77,532 109,893 5,906 5,906Deferred tax assets not recognised on tax losses 164,602 80,201 45,746 45,746

(b) Tax losses


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Carried forward indefinitely 1,103,736 1,076,456 34,742 34,742Expiring on a rolling basis over 5 years 575,355 742,382 269,095 269,095

1,679,091 1,818,838 303,837 303,837


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000At January 1, - as previously reported 218,143 151,960 (23,081) (17,355)- effect of change in the effective tax rate (note 45(d)) 30,943 29,848 (3,078) (2,314)- as restated 249,086 181,808 (26,159) (19,669)Charged/(credited) to profit or loss (note 13(a)) 47,266 69,334 6,428 (4,709)Charged/(credited) to other comprehensive income 1,996 (2,054) 1,686 (1,781)At December 31, 298,348 249,088 (18,045) (26,159)

(c) Movement on the deferred income tax account:

(d) The movement in deferred tax assets and liabilities during the year, without taking into consideration the offsetting of balances within the same fiscal authority on the same entity is as follows:

THE GROUPAccelerated tax

depreciationRs’000

Bearer biological assetsRs’000

TotalRs’000

Deferred tax liabilitiesAt January 1, 2017- as previously reported 388,004 15,765 403,769- effect of change in the effective tax rate (note 45(d)) 40,084 2,102 42,186- as restated 428,088 17,867 445,955Charged to income statements (35,278) (138) (35,416)At January 1, 2018 392,810 17,729 410,539Credited to income statements 18,201 250 18,451At December 31, 2018 411,011 17,979 428,990

Tax lossesRs’000

Retirement benefit obligations

Rs’000Total

Rs’000Deferred tax assetsAt January 1, 2017- as previously reported (193,900) (57,909) (251,809)- effect of change in the effective tax rate (note 45(d)) (7,416) (4,922) (12,338)- as restated (201,316) (62,831) (264,147)Charged to income statements 91,423 13,327 104,750Credited to statement of comprehensive income - (2,053) (2,053)At January 1, 2018 (109,893) (51,557) (161,450)Charged/(credited) to income statements 32,361 (3,548) 28,813Charged to statement of comprehensive income - 1,996 1,996At December 31, 2018 (77,532) (53,109) (130,641)


23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d) 23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d)




23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d)

24. INVENTORIES

THE COMPANYAccelerated tax

depreciationRs’000

Bearer biological assetsRs’000

TotalRs’000

Deferred tax liabilitiesAt January 1, 2017- as previously reported 2,274 15,764 18,038- effect of change in the effective tax rate (note 45(d)) 303 2,102 2,405 - as restated 2,577 17,866 20,443Charged/(credited) to income statements 873 (138) 735At January 1, 2018 3,450 17,728 21,178Charged to income statements 9,715 252 9,967At December 31, 2018 13,165 17,980 31,145

Tax lossesRs’000

Retirement benefit obligations

Rs’000Total

Rs’000Deferred tax assetsAt January 1, 2017- as previously reported (2,784) (32,609) (35,393)- effect of change in the effective tax rate (note 45(d)) (372) (4,347) (4,719)- as restated (3,156) (36,956) (40,112)Credited to income statements (2,750) (2,694) (5,444)Credited to statement of comprehensive income - (1,781) (1,781)At January 1, 2018 (5,906) (41,431) (47,337)Credited to income statements (3,539) (3,539)Charged to statement of comprehensive income - 1,686 1,686At December 31, 2018 (5,906) (43,284) (49,190)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Spare parts and consumables - Growing 8,571 9,719 8,571 9,719 - Milling 65,612 82,818 - - - Energy production 533,648 519,431 - - - Ethanol & Molasses 104,549 159,514 - - - Logistics & Hotel 9,236 8,910 - -

721,616 780,392 8,571 9,719

(i) The cost of inventories recognised as expense and included under operating expenses amounted to Rs’000 1,759,133 (2017: Rs’000 1,781,066) for the Group and Rs’000 43,754 (2017: Rs’000 49,442) for the Company.

(ii) The bank borrowings are secured by floating charges on the assets of the Company or its subsidiaries, including inventories (note 31).

25. CONSUMABLE BIOLOGICAL ASSETS

26. RECEIVABLE FROM RELATED PARTIES

Consumable biological assets represent the fair value of standing canes. The fair value has been arrived at by discounting the present value of expected net cash flows at the relevant market determined pre-tax rate. The expected cash flows have been computed by estimating the expected crop, the sugar extraction rate and the forecasts of sugar prices which will prevail in the coming year. The harvesting costs and other direct costs are based on yearly budgets.

The fair value measurements for standing canes have been categorised as Level 3 fair values based on the inputs to the valuation techniques used.

At December 31, 2018, standing canes comprised approximately 2,366 hectares of cane plantations (2017: 2,381 hectares) for the Group and 1,881 hectares (2017: 1,883 hectares) for the Company.

During the year, the Group harvested approximately 262,177 tons of canes (2017: 211,000 tons) and the Company harvested 144,920 tons (2017: 156,000 tons).


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Standing canes (at fair value)At January 1, 58,291 118,465 38,833 87,629Additions - 1,428 - -Loss arising from changes in fair value (2,164) (61,602) (1,692) (48,796)At December 31, 56,127 58,291 37,141 38,833

THE GROUP THE COMPANY2018 2017 2018 2017

The principal assumptions used are:Expected price of sugar per ton (Rs) 11,250 12,500 11,250 12,500Expected sugar accruing (tons) 16,940 16,929 12,585 12,575Expected average extraction rate (%) 10.15 9.72 10.33 10.28


Rs’0002017

Rs’000Subsidiary companies - 4,040,297Companies with common directors 1,354 1,354Associated companies 720,568 340,798Subsidiaries of holding company 140,808 122,563Other related companies 130,594 77,169

993,324 4,582,181

Receivable from related parties are classified under financial assets at amortised cost (note 21) for 2018. In 2017, receivable from related parties bears interest between 6% to 7.65% per annum.





27. TRADE AND OTHER RECEIVABLES (cont’d)

(d) The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.

(e) In 2017, the impairment of trade receivables was assessed based on the incurred loss model. Individual receivables which were known to be uncollectible were written off by reducing the carrying amount directly. The other receivables were assessed collectively to determine whether there was objective evidence that an impairment had been incurred but not yet been identified. For these receivables the estimated impairment losses were recognised in a separate provision for impairment.

28. NON-CURRENT ASSETS HELD FOR SALE

THE GROUPMorcellement

land (note 28(c))

Rs’000

Factory equipment (note 28(d))

Rs’000

Total2018

Rs’000

Total2017

Rs’000At January 1, 2018- As previously reported 32,949 12,893 45,842 68,753- Effect of changes in accounting policies (note 45(c)) 31,955 - 31,955 -- As restated 64,904 12,893 77,797 68,753Transfer from property, plant and equipment (note 15) 4,999 - 4,999 -Transfer to property, plant and equipment (note 15) - - - (7,158)Transfer to other financial assets at amortised cost (note 21) (25,747) - (25,747) -Disposals (17,559) - (17,559) (15,753)At December 31, 2018 26,597 12,893 39,490 45,842

Morcellement land (note 28(c))

THE COMPANYTotal2018

Rs’000

Total2017

Rs’000At January 1,- As previously reported 32,949 55,860- Effect of changes in accounting policies (note 45(c)) 31,955 -- As restated 64,904 55,860Transfer from property, plant and equipment (note 15) 4,999 -Transfer to property, plant and equipment (note 15) - (7,158)Transfer to other financial assets at amortised cost (note 20) (25,747) -Disposals (17,559) (15,753)At December 31, 26,597 32,949

(c) Omnicane Limited has embarked on the development of Morcellement Fairview and the freehold land earmarked for this Morcellement has been reclassified as held for sale in financial year 2016. During the year, part of the Morcellement land has been transferred from property, plant and equipment and part has been disposed of. Unsold lots for Morcellement Fairview has been transferred to other financial assets at amortised cost. The remaining balance represents the unsold lots for Morcellement Highlands Rose.

(d) One of the subsidiaries (Omnicane Milling Operations Limited) intends to dispose part of factory equipment of Union St. Aubin and Mon Trésor which was part of the Company’s milling operations.

(a)

(b)

27. TRADE AND OTHER RECEIVABLES

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.

(a) Trade debtors represent mainly electricity, ethanol and sugar proceeds receivable. The sugar proceeds receivable are paid by the Mauritius Sugar Syndicate (MSS) as and when proceeds are received. Advances on sugar proceeds are paid on a weekly basis and the final settlement for the crop year is made at latest in June of the following year. Refined sugar become receivable as and when the Group invoices the MSS.

Electricity and refined sugar proceeds receivable are generally paid within one month.

(b) Other receivables are classified under financial assets at amortised cost (note 21) for 2018.

(c) Impairment of trade receivables The Group/Company applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables.

To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due.

The expected loss rates are based on the payment profiles of sales over a period of 12 months before December 31, 2018 or January 1, 2018 respectively and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.

On that basis, the resulting loss allowance as at 31 December 2018 and 1 January 2018 (on adoption of IFRS 9) was not included in the financial statements as the identified impairment loss was immaterial.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Trade receivables (note 27(a)) 521,073 746,230 39,495 60,973Other receivables:- Prepayments and other receivables - 351,063 - 44,497- Deferred project expenses - 319,457 - 294,310- Land under development - 226,048 - 226,048

521,073 1,642,798 39,495 625,828

The carrying amount of trade and other receivables are denominated in the following currencies:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Mauritian Rupee 340,904 1,090,024 39,495 625,828Euro 125,385 109,931 - -US Dollar 54,784 442,843 - -

521,073 1,642,798 39,495 625,828





30. REVALUATION AND OTHER RESERVES (cont’d)

THE COMPANY Revaluation reserveRs’000

Available-for-sale

Fair value reserveRs’000

Financial assets at

FVOCIRs’000

Actuarial losses reserveRs’000

TotalRs’000

Balance at January 1, 2018 -- as previously stated 5,242,975 4,891 - (128,157) 5,119,709- effect of changes in accounting policies (note 45) - (4,891) 4,891 - -- as restated 5,242,975 - 4,891 (128,157) 5,119,709Remeasurement of defined benefit obligations - - - 8,232 8,232Increase in fair value of investment - - 3 - 3Transfer to retained earnings (4,951) - - - (4,951)Balance at December 31, 2018 5,238,024 - 4,894 (119,925) 5,122,993

Balance at January 1, 2017 5,613,122 4,887 - (118,062) 5,499,947Remeasurement of defined benefit obligations - - - (10,095) (10,095)Increase in fair value of investment - 4 - - 4Transfer to retained earnings (1,229,441) - - - (1,229,441)Land conversion rights 211,837 - - - 211,837Surplus on revaluation of land 647,457 - - - 647,457Balance at December 31, 2017 5,242,975 4,891 - (128,157) 5,119,709

Revaluation reserveThe revaluation reserve relates to the surplus on revaluation of land and land conversion rights.

Available-for-sale fair value reserveFair value reserve comprises the cumulative net change in the fair value of financial assets at fair value through other comprehensive income that has been recognised in other comprehensive income until the investments are derecognised or impaired. The balance was reclassified to financial assets at fair value through other comprehensive income on January 1, 2018.

Financial assets at fair value through other comprehensive income reserveGain/losses arising on financial assets at fair value through other comprehensive income. The balance was reclassified from available-for-sale fair value reserve at January 1, 2018.

Hedging reserveGains/losses arising on the effective portion of hedging instruments carried at fair value in a qualifying cash flow hedge.

Actuarial losses reserveThe actuarial losses reserve represents the cumulative remeasurement of defined benefit obligations recognised.

29. SHARE CAPITAL

THE GROUP AND THE COMPANY2018 & 2017

Rs’000Issued and Fully paid67,012,404 ordinary shares of Rs.7.50 each 502,593

The total authorised number of ordinary shares is 67,012,404 shares (2017: 67,012,404) with a par value of Rs.7.50 per share (2017: Rs.7.50). All issued shares are fully paid.

THE GROUP Revaluation reserveRs’000

Available-for-sale

Fair value reserveRs’000

Financial assets at

FVOCIRs’000

Hedging reserveRs’000

Actuarial losses reserveRs’000

Associate reserveRs’000

Translation reserveRs’000

Owners’ interestsRs’000

Balance at January 1, 2018 -- as previously stated 8,766,702 110,761 - (36,426) (193,871) (78,192) (6,983) 8,561,991- effect of prior year adjustments - - - - (38) - - (38)- effect of changes in accounting policies - (110,761) 110,761 - - - - -- as restated 8,766,702 - 110,761 (36,426) (193,909) (78,192) (6,983) 8,561,953Remeasurement of defined benefit obligations - - - - 17,648 - - 17,648Decrease in fair value of investments - - (84,036) - - - - (84,036)Loss on revaluation of land (510) - - - - - - (510)Transfer to retained earnings (5,667) - - - - - - (5,667)Cash flow hedge - - - 22,557 - - - 22,557Balance at December 31, 2018 8,760,525 - 26,725 (13,869) (176,261) (78,192) (6,983) 8,511,945

Balance at January 1, 2017- as previously stated 6,409,751 81,696 - (26,881) (176,189) (94,528) (1,454) 6,192,395- effect of prior year adjustments - - - - (45) - - (45)- as restated 6,409,751 81,696 - (26,881) (176,234) (94,528) (1,454) 6,192,350Remeasurement of defined benefit obligations - - - - (17,675) - - (17,675)Movement in associate reserve - - - - - 16,336 - 16,336 Increase in fair value of investment - 29,065 - - - - - 29,065 Land Conversion Rights 211,837 - - - - - - 211,837 Surplus on revaluation of land 2,546,109 - - - - - - 2,546,109 Transfer to retained earnings (400,995) - - - - - - (400,995)Cash flow hedge - - - (9,545) - - - (9,545)Currency translation differences - - - - - - (5,529) (5,529)Balance at December 31, 2017 8,766,702 110,761 - (36,426) (193,909) (78,192) (6,983) 8,561,953

30. REVALUATION AND OTHER RESERVES





30. REVALUATION AND OTHER RESERVES (cont’d)

Associated reserveThe associated reserve represents cumulative share of other comprehensive income of investments held in associated companies.

Translation reserveThe translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

31. BORROWINGS


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Non-currentBank loans (note 31(a)) 3,695,757 3,649,960 624,696 101,666Private Placement (note 31(e)) 2,500,000 2,500,000 2,500,000 2,500,000Loan from related party (note 31(f)) - 14,000 - -Bonds (note 31(d)) 1,590,000 1,800,000 1,590,000 1,800,000Finance lease liabilities (note 31(c)) 44,139 41,478 11,084 11,580

7,829,896 8,005,438 4,725,780 4,413,246CurrentBank overdrafts (note 31(b)) 1,421,850 1,430,460 1,135,499 1,196,898Bank loans (note 31(a)) 1,429,965 1,330,014 419,925 648,342Bonds (note 31(d)) 210,000 - 210,000 -Loan from related party (note 31(f)) 89,274 - - -Finance lease liabilities (note 31(c)) 24,809 26,062 7,002 7,366

3,175,898 2,786,536 1,772,426 1,852,606

Total borrowings 11,005,794 10,791,974 6,498,206 6,265,852

(a) Bank loansThe bank loans are secured by floating charges on the Company’s or subsidiaries’ assets, including property, plant and equipment and inventories (notes 15 and 24). The rates of interest on these loans vary between 5.30% and 8.50% (2017: 3.00% and 7.65%).

31. BORROWINGS (cont’d)

(b) Bank overdraftsThe bank overdrafts are secured by floating charges on the Company’s or subsidiaries’ assets. The rates of interest on bank overdrafts vary between 4.25% and 7.25% at year end (2017: 4.25% and 7.25%).

(c) Finance lease liabilities - minimum lease payments


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000The maturity of non-current bank loans are as follows:- After one year and before two years 1,297,735 1,023,831 449,696 101,666- After two years and before five years 1,326,440 2,068,500 175,000 -- After five years 1,071,582 557,629 - -

3,695,757 3,649,960 624,696 101,666


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Not later than one year 28,685 30,113 8,017 8,542Later than one year and not later than two years 22,025 21,661 5,899 6,596Later than two years and not later than five years 26,072 23,302 6,114 5,939

76,782 75,076 20,030 21,077Future finance charges on finance leases (7,834) (7,536) (1,944) (2,131)Present value of finance lease liabilities 68,948 67,540 18,086 18,946

The maturity of finance lease liabilities are as follows:Not later than one year 24,809 26,062 7,002 7,366Later than one year and not later than two years 19,773 19,542 5,353 5,949Later than two year and not later than five years 24,366 21,936 5,731 5,631

68,948 67,540 18,086 18,946


(d) Bonds

These relate to multi-currency medium term loan notes which are secured by floating charges on the assets of the Company and bear both fixed and floating coupon rates. As at December 31, 2018, the coupon rates on the bonds vary between the range of 4.30% - 7.15% (2017: 4.30% - 7.15%). The notes are repayable over a 1, 3 and 5 year period.

(e) Private placement


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000- Within one year 210,000 - 210,000 -- After one year and before two years - 210,000 - 210,000- After two years and before five years 1,590,000 1,150,000 1,590,000 1,150,000- After five years - 440,000 - 440,000

1,800,000 1,800,000 1,800,000 1,800,000

THE GROUP & THE COMPANY THE GROUP & THE COMPANY2018

Rs’0002017

Rs’000- After two years and before five years 300,000 300,000- After five years 2,200,000 2,200,000

2,500,000 2,500,000





Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Amounts recognised in the statements of financial position as non-current liabilities:- Pension benefits (note 32(a)(ii)) 442,842 433,046 254,613 243,712

Amount charged to profit or loss:- Pension benefits (note 32(a)(vi)) 46,042 37,408 25,827 19,777

Amount (credited)/charged to other comprehensive income:- Pension benefits (note 32(a)(vii)) (21,545) 21,566 (9,918) 11,876

32. RETIREMENT BENEFIT OBLIGATIONS

(a) Pension benefits

(i) The Group operates a final salary defined benefit pension or retirement plan for some employees and any plan assets are held separately from the Group. The assets of the plan are invested in unitised funds held within the SIPF. Other post retirement benefits relate mainly to gratuities on death and on retirement that are based on length of service and salaries at date of death and retirement.

The most recent actuarial valuations of plan assets and the present value of the defined benefit obligations were carried out at December 31, 2018 by AON Hewitt Ltd (Actuarial Valuer). The present value of the defined benefit obligations, and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

(ii) Amounts recognised in the statements of financial position:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Present value of funded obligations 673,673 682,858 364,969 368,488Fair value of plan assets (404,914) (410,344) (211,142) (216,939)

268,759 272,514 153,827 151,549Present value of unfunded obligations 174,083 160,532 100,786 92,163Liability in the statements of financial position 442,842 433,046 254,613 243,712

(iii) Movements in the statements of financial position are:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 433,046 387,930 243,712 217,385Charged to profit or loss 46,042 37,408 25,827 19,777Charged to other comprehensive income (21,545) 21,566 (9,918) 11,876Contributions paid (14,701) (13,858) (5,008) (5,326)At December 31, 442,842 433,046 254,613 243,712

In 2017, the Company issued private placements amounting to Rs.2.5 billion. These are secured by floating charges on the assets of the Company and bear a fixed coupon rate. As at December 31, 2018, the coupon rate on the private placement vary between the range of 5.90% - 6.40%. The notes are repayable over a 4 and 6 year’s period.

(f) Loan from related partyThe loan from related party bears interest of 4.35% - 7.75% (2017: 4.35% - 5.10%).

(g) All rupee denominated bank overdrafts and bank borrowings bear interest rates which can fluctuate anytime when the banks modify their Prime Lending Rates based on the Bank of Mauritius’ Repo rate. Euro denominated bank borrowings bear fixed and floating interest rates.

(h) The carrying amount of the Group’s and the Company’s borrowings are denominated in the following currencies:THE GROUP THE COMPANY

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Mauritian Rupee 8,810,629 8,567,922 6,016,090 6,125,810Euro 1,228,695 1,384,078 - 1,112GBP 371,695 138,930 264,840 138,930US Dollar 594,775 701,044 217,276 -

11,005,794 10,791,974 6,498,206 6,265,852

(i) The carrying amount of borrowings are not materially different from the fair value.

(j) The effective interest rates at the date of the statement of financial position were as follows:

2018 2017

THE GROUP Rs.%

Euro & USD%

Rs.%

Euro & USD%

Bank loans 5.30-8.50 0.69-8.00 5.75-8.50 0.69-6.34Bank overdrafts 4.25-7.75 N/A 4.25-7.75 N/AShort-term loan 6.00-6.75 N/A 6.00-6.75 2.75-5.48Loan from related party 4.35-7.75 N/A 4.35-5.10 N/AFinance lease liabilities 5.50-8.50 N/A 5.85-8.50 N/APrivate Placement 5.90-6.40 N/A 5.90-6.40 N/ABonds 4.30-7.15 N/A 4.30-7.15 N/A

2018 2017

THE COMPANY Rs.%

Euro & USD%

Rs.%

Euro & USD%

Bank loans 5.60-7.00 3.8-6.43 5.75-7.65 3.00Bank overdrafts 4.25-6.25 N/A 4.25-7.25 N/AShort-term loan 6.00-6.75 N/A 6.00-6.75 2.75-5.48Loan from related party 4.35-7.75 N/A 4.35-5.10 N/AFinance lease liabilities 6.85-8.25 N/A 6.85-8.25 N/APrivate Placement 5.90-6.40 N/A 5.90-6.40 N/ABonds 4.30-7.15 N/A 4.30-7.15 N/A

(k) Borrowings of Rs. 56,000,000 have been pledged against shares in financial assets.

31. BORROWINGS (cont’d)

(e) Private placement (cont’d)





32. RETIREMENT BENEFIT OBLIGATIONS (cont’d)

(a) Pension benefits (cont’d)

(iv) Movements in the defined benefit obligations:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 843,390 783,143 460,651 428,853Current service cost 14,463 13,250 6,383 6,075Employee contributions 1,701 1,902 801 911Interest cost 45,092 49,519 24,669 27,148Past service cost 8,419 (502) 6,165 (221)Benefits paid (47,428) (41,720) (25,789) (22,514)Liability experience gains (15,240) (4,648) (11,341) (1,988)Other benefits paid (205) - - -Liability losses due to change in financial assumptions (2,436) 42,446 4,216 22,387At December 31, 847,756 843,390 465,755 460,651

(v) Movements in the fair value of plan assets of the year:

(vi) Amounts recognised in profit or loss:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 410,344 395,213 216,939 211,468Interest income 21,727 24,859 11,390 13,225Return on plan assets excluding interest income 3,869 16,232 2,793 8,523Employer contributions 12,029 13,858 5,008 5,326Employee contributions 1,701 1,902 801 911Benefits paid (44,756) (41,720) (25,789) (22,514)At December 31, 404,914 410,344 211,142 216,939


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Current service cost 14,463 13,250 6,383 6,075Past service cost 8,419 (502) 6,165 (221)Interest expense 143 185 - -Employer contribution (205) - - -Net interest on net defined benefit liability 23,222 24,475 13,279 13,923Total included in employee benefit expense 46,042 37,408 25,827 19,777




(vii) The amounts recognised in other comprehensive income are:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Liability experience gains (15,240) (4,648) (11,341) (1,988)Actuarial (gains)/losses arising from changes in financial assumptions (2,436) 42,446 4,216 22,387

(17,676) 37,798 (7,125) 20,399Return on plan assets excluding interest income (3,869) (16,232) (2,793) (8,523)

(21,545) 21,566 (9,918) 11,876

(viii) The assets in the plan were:

(ix) The assets of the plan are invested in equities, fixed interest bonds and bank deposits. The expected return on plan assets was determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed interest investments are based on gross redemption yields at the end of the reporting period. Expected returns on equity and property investments reflect long-term real rates of return experienced in the respective markets.

(x) The funding policy is to pay contributions to an external legal entity at the rate recommended by the Group’s actuary. Expected contributions to post-employment benefit plans for the year ending December 31, 2019 are Rs’000 50,876 for the Group and Rs’000 26,396 for the Company.

(xi) The weighted average duration of the defined benefit obligations for the Group/Company at the end of the reporting period is 7 years.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Overseas equities 101,229 82,069 52,786 43,388Local equities 117,425 119,000 61,231 62,912Fixed interest - Overseas 21,114 17,481 21,114 15,186Fixed interest - Local 27,448 49,896 27,448 49,896Debt 44,568 51,859 - -Property 76,934 90,039 40,117 45,557Cash and others 16,197 - 8,446 -Total market value of assets 404,914 410,344 211,142 216,939




(xii) The principal actuarial assumptions used for accounting purposes were:

(xiii) The defined benefit pension plan exposes the Group to actuarial risks, such as investment, interest, longevity and salary risks.

Investment riskThe plan liability is calculated using a discount rate determined by reference to government bond yields; if the return on plan assets is below this rate, it will create a plan deficit and if it is higher, it will create a plan surplus.

Interest riskA decrease in the bond interest rate will increase the plan liability; however, this may be partially offset by an increase in the return on the plan’s debt investments and a decrease in inflationary pressures on salary and pension increases.

Longevity riskThe plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan liability.

Salary riskThe plan liability is calculated by reference to the future projected salaries of plan participants. As such, an increase in the salary of the plan participants above the assumed rate will increase the plan liability whereas an increase below the assumed rate will decrease the liability.

(xiv) Sensitivity analysis on defined benefit obligations at end of the reporting date:


%2017

%2018

%2017

%Discount rate 5.89 5.50 5.60 5.50Future salary increases 3.75 4.00 3.50 4.00Future pension increases 1.00 1.00 1.00 1.00Average retirement age (ARA) 57 60 60 60


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

- Increase due to 1% decrease in discount rate 83,499 60,929 40,577 32,911- Decrease due to 1% increase in discount rate 68,145 50,286 33,722 28,071

33. PAYABLE TO RELATED PARTIES

34. TRADE AND OTHER PAYABLES

35. BLUE PRINT COSTS


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Holding company 4,423 547 4,423 547Subsidiary companies - - 496,922 3,727Subsidiaries of holding company 125,353 129,600 42,686 53,654Companies with common directors 2,621 3,059 - -

132,397 133,206 544,031 57,928

The carrying amounts of payable to related parties approximate their fair values.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Trade payables 614,761 530,509 71,749 41,446Other payables and accrued expenses 558,460 498,496 126,281 148,805Deposit on sale of land 345,571 - 318,571 -

1,518,792 1,029,005 516,601 190,251

The carrying amounts of trade and other payables approximate their fair values.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Provision for infrastructure and social costs 54,401 54,426 - -

Blue print costs relate to future expenditure in respect to land and infrastructure costs for employees who opted for the Blue Print and Early Retirement Scheme for Omnicane Milling Operations Limited.




An increase/decrease of 1% in other principal actuarial assumptions would not have a material impact on defined benefit obligations at the end of the reporting period.




36. DIVIDENDS PAYABLE

37. NOTES TO THE STATEMENTS OF CASH FLOWS

(a) Cash generated from/(absorbed by) operations before working capital changes


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

January 1, 134,025 134,025 134,025 134,025

Dividend paid during the year (117,225) (134,025) (117,225) (134,025)Final proposed dividend of Rs.nil per share (2017: Rs.2.00) - (134,025) - (134,025)December 31, 16,800 134,025 16,800 134,025


Notes2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Loss before taxation (325,768) (232,373) (18,274) (104,530)Adjustments for: -Depreciation of property, plant and equipment 15 611,972 599,358 48,629 47,680Amortisation of intangible assets 16 32,022 32,613 10,152 11,525Impairment of investment in subsidiary 17 - 1,760 39,054 1,760Movement in provision for retirement benefit obligations 31,341 23,550 20,819 14,451Dividend income 9 (4,787) (4,760) (134,450) (176,826)Interest income 9 (151,362) (116,816) (398,450) (335,291)Interest expense 10 635,555 643,354 375,623 360,129Share of results of associates 18 1,953 155,950 - -Land conversion rights acquired - (201,665) - (89,281)Gain on retranslation of non-current receivables - (95,623) - -Cash flow hedge and translation reserve movement 33,133 (12,480) - -Land debtors written off - 14,367 - 14,367Reversal of profit on sale on land - 71,218 - 71,218Profit on sale of property (3,075) (52,356) - -Profit on sale of land (128,359) (62,775) (128,359) (62,775)Profit (loss) on sale of investment in financial assets 1,986 - 1,986 -Profit on sale of management contract - (56,717) - (36,200)Profit on sale of plant and equipment - (2,154) (2,013) (1,163)Loss in fair value of consumable biological assets 2,164 61,602 1,692 48,796Cash generated from/(absorbed by) operations before working capital changes 736,775 766,053 (183,591) (236,140)

37. NOTES TO THE STATEMENTS OF CASH FLOWS (cont’d)

(b) Working capital requirements comprise

(c) Dividends paid

(d) Reconciliation of liabilities arising from financing activities


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Inventories 58,776 (38,309) 1,148 (632)Trade and other receivables 2,299,138 276,955 586,333 60,217Receivable from related parties 993,324 (337,784) 4,967,231 (650,165)Trade and other payables 47,672 (64,580) (123,437) 48,042Payable to related parties (809) (44,666) 486,103 (7,938)Financial assets at amortised cost (1,426,030) - (2,705,349) -Other financial assets at amortised cost (1,980,174) - (3,491,699) -Total working capital requirements (8,103) (208,384) (279,670) (550,476)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Dividends are reconciled to the amounts disclosed in the statement of comprehensive income as follows:Amounts due at beginning of the year (134,025) (134,025) (134,025) (134,025)Dividends declared - (134,025) - (134,025)Amounts due at the end of the year 16,800 134,025 16,800 134,025Dividends paid (117,225) (134,025) (117,225) (134,025)

THE GROUP At January 1, 2018 Rs’000

Cash outflowsRs’000

AcquisitionRs’000

Foreign exchange movement

Rs’000

At December 31, 2018

Rs’000Bank loans 4,979,974 (1,056,024) 1,224,215 (22,443) 5,125,722

THE COMPANY At January 1, 2018 Rs’000

Cash outflowsRs’000

AcquisitionRs’000

Foreign exchange movement

Rs’000

At December 31, 2018

Rs’000Bank loans 750,008 (449,253) 744,015 (148) 1,044,622





38. CAPITAL COMMITMENTS

Capital expenditure contracted for at the end of the reporting period but not yet incurred is as follows:

(e) Cash and cash equivalents

Cash and cash equivalents consist of cash in hand and balances with banks and bank overdrafts. Cash and cash equivalents are represented by:

(f) Deposits in escrow accounts

Deposits of Rs.’000 21,180 are held in escrow accounts and relate to security deposits as consideration for reservation of residential units under the smart city project to be sold under VEFA.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Cash in hand and at bank 195,126 387,644 12,326 54,788Cash at Notary 23,000 - - -

218,126 387,644 12,326 54,788Bank overdrafts (note 31(b)) (1,421,850) (1,430,460) (1,135,499) (1,196,898)

(1,203,724) (1,042,816) (1,123,173) (1,142,110)

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was immaterial.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Capital expenditure approved by the Board:- not contracted 87,155 38,044 - 8,088- contracted 71,412 163,867 33,525 110,615

158,567 201,911 33,525 118,703


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Bank and other guaranteesBank guarantee 83,644 507,421 3,500 226,154Government guarantee 42,386 35,325 386 -Performance bond 280 416 - -Money guarantee 240,000 - - -

366,310 543,162 3,886 226,154

39. CONTINGENT LIABILITIES

39. CONTINGENT LIABILITIES (cont’d)

At December 31, 2018, the Group had contingent liabilities in respect of bank and other guarantees and other matters arising in the ordinary course of business from which it is anticipated that no material liabilities would arise.

Refad Rwanda Ltd has placed USD 750,000 performance bond with the Rwanda Energy Group Limited for the supply of 2 MW of power by January 2019 and supply of 3 MW of power by December 2019.

40. HOLDING COMPANYThe holding company is Omnicane Holdings Limited, a Company incorporated in Mauritius.


37. NOTES TO THE STATEMENTS OF CASH FLOWS (cont’d)



41. RELATED PARTY TRANSACTIONS

(a) THE GROUP

(Purchase)/sale of supplies and services Interest (expense)/ income Amount due to Amount due from

THE GROUP 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Holding company - - (4,188) (790) 4,423 547 - -Associated companies - - 140,783 105,476 - - 1,204,194 720,568Subsidiaries of holding company (186,184) (176,539) 1,417 8,074 125,353 129,600 1,637 140,808Companies with common directors (11,140) (16,217) - - 1,400 3,059 4,493 6,716Other related parties - - 65 745 1,221 - 74,398 125,232

(197,324) (192,756) 138,077 113,505 132,397 133,206 1,284,722 993,324

(b) THE COMPANY

(Purchase)/sale of supplies and services

Interest (expense)/ income

Dividend (payable)/ income Amount owed to Amount due from

THE COMPANY 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Holding company - - (4,188) (790) (16,800) (94,150) 4,423 547 - -Subsidiary companies (55,399) (49,532) 350,036 323,602 134,450 176,800 516,678 3,727 3,680,019 4,040,297Associated companies 1,000 1,000 30,480 9,204 - - - - 649,521 340,798Subsidiaries of holding company (36,166) 263,283 (9,664) (3,331) - - 42,506 53,654 - 122,563Other related companies - - (95) 934 - - - - - 77,169Companies with common directors - - - - - - - 2,776 1,354

(90,565) 214,751 366,569 329,619 117,650 82,650 563,607 57,928 4,332,316 4,582,181

The above transactions have been made on normal commercial terms and in the normal course of business.

The sales to and purchases from the related parties are made at normal market prices. Outstanding balances at the year end are unsecured, interest free and settlement occurs in cash.

There has been no guarantees provided or received for any related party receivables or payables.



Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Short-term benefits 60,760 68,458 7,996 23,677Post-employment benefits 300 4,096 426 524

61,060 72,554 8,422 24,201

Sugar and Ethanol Energy Hospitality Property Total2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Primary reporting format

- business segments

Segment revenue 1,440,206 1,634,064 2,595,728 2,700,385 165,908 161,412 43,329 43,329 4,245,171 4,539,150

Segment operating (loss)/profit (365,777) (318,229) 414,757 509,805 5,788 920 (30,824) (23,310) 23,944 169,185Share of loss from associates (1,953) (155,950)

Investment income 156,149 121,576Other non operating income/(expenses) 128,360 (22,810)

Exceptional items - 212,597

Finance costs (632,268) (556,971)

Loss before taxation (325,768) (232,373)

Taxation (76,562) (94,193)

Loss for the year (402,330) (326,566)

Non-controlling interests 11,386 96,236Loss attributable to owners of the parent (413,716) (422,802)

42. SEGMENT INFORMATION

The Group is organised into the following main business segments:

43. SEGMENT INFORMATION (cont’d)

The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies.

Sugar and Ethanol Energy Hospitality Property Total2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Segment assets 13,650,262 13,713,481 6,217,929 5,972,885 737,748 761,802 3,771,590 3,509,801 24,377,529 23,957,969

Associates 79,844 964,672

24,457,373 24,922,641

Segment liabilities 8,287,739 8,263,130 4,320,444 4,032,802 521,548 539,026 421,068 88,796 13,550,799 12,923,754

Owners’ interests 9,930,284 10,964,991

Non-controlling interests 976,290 1,033,896

24,457,373 24,922,641

Investment income 147,570 112,382 8,579 9,194 - - - - 156,149 121,576

Interest expense 464,467 419,474 151,245 198,421 19,843 25,459 - - 635,555 643,354Capital expenditure - Property, plant and equipment

270,087 257,548 314,407 139,455 7,251 1,635 76,752 26,771 668,497 425,409

Depreciation - Property, plant and equipment 261,793 256,029 320,585 314,292 29,451 29,037 143 - 611,972 599,358




(i) KEY MANAGEMENT PERSONNEL COMPENSATION

41. RELATED PARTY TRANSACTIONS (cont’d)

(b) THE COMPANY (cont’d)


44. THREE YEARS FINANCIAL SUMMARY


Restated2017

Rs’000

Restated 2016

Rs’000Turnover 4,245,171 4,539,150 4,502,280Share of (loss)/profit of associates (1,953) (155,950) 4,732(Loss)/profit before taxation (325,768) (232,373) 234,392Income tax charge (76,562) (94,193) (26,699)(Loss)/profit for the year (402,330) (326,566) 207,693Other comprehensive income for the year (33,235) 2,783,894 (76,199)Total comprehensive income for the year (435,565) 2,457,328 131,494

(Loss)/profit attributable to:- Owners of the parent (413,716) (422,802) 132,004- Non-controlling interests 11,386 96,236 75,689

(402,330) (326,566) 207,693Total comprehensive income attributable to:- Owners of the parent (458,057) 2,347,796 59,801- Non-controlling interests 22,492 109,532 71,693

(435,565) 2,457,328 131,494(Loss)/earnings per share (Rs.) (6.17) (6.28) 1.97


Restated2017

Rs’000

Restated 2016

Rs’000ASSETSNon-current assets 20,834,573 21,039,936 18,436,089Current assets 3,622,800 3,882,705 4,698,985Total assets 24,457,373 24,922,641 23,135,074

EQUITY AND LIABILITIESOwners’ interests 9,930,284 10,964,991 8,751,220Non-controlling interests 976,290 1,033,896 1,040,364Total equity 10,906,574 11,998,887 9,791,584

LIABILITIESNon-current liabilities 8,646,980 8,781,209 7,073,320Current liabilities 4,903,819 4,142,545 6,270,170Total liabilities 13,550,799 12,923,754 13,343,490

Total equity and liabilities 24,457,373 24,922,641 23,135,074

Net assets per share (Rs.) 148.19 163.62 130.59

45. CHANGES IN ACCOUNTING POLICIES

(a) Impact on the financial statements

For the year ended December 31, 2018, following changes in deferred tax rate, the financial statements have been restated retrospectively in accordance with IAS 8. Consequently the Group/Company has adjusted opening equity and deferred taxation liability as of January 1, 2017 and figures for 2016 have been restated as if the new accounting policy has always been applied.

IFRS 9 and IFRS 15 were adopted without restating comparative information. Any adjustments arising from the new accounting policies are not reflected in the comparatives year ended December 31, 2017 but are recognised in the opening reserves on January 1, 2018.

The following tables show the adjustments recognised for each individual line item.

Statement of financial position (Extract)

(a) Results

(b) Statement of financial position

THE GROUPNotes

As previously reportedRs’000

Cumulative adjustment

Rs’000Restated balance

Rs’000January 1, 2018Non-current assetsProperty, plant and equipment 45(c) 16,651,091 8,897 16,659,988Financial assets at amortised cost - Loss allowance 45(b) - (345,210) (345,210) - Deferred project written off 319,457 (42,926) 276,531Deferred tax assets 45(f) 84,263 9,376 93,639

Current assetsOther financial assets at amortised cost - Loss allowance 45(d) - (45,072) (45,072) - Land under development 45(c) 226,048 291,964 518,012Non-current assets held for sale 45(c) 45,842 31,955 77,797

EquityRevaluation and other reserves 8,561,991 (38) 8,561,953Retained earnings 1,622,774 (603,605) 1,019,169

Non-controlling interests 1,050,023 (10,193) 1,039,830

Non-current liabilitiesDeferred tax liabilities 45(f) 302,406 40,319 342,725

Current liabilitiesTrade and other payables 45(c) 1,029,005 482,501 1,511,506





45. CHANGES IN ACCOUNTING POLICIES (cont’d)

(a) Impact on the financial statements (cont’d)

Statement of financial position (Extract) (cont’d)

THE GROUPNotes




Rs’000January 1, 2017Non-current assetsDeferred tax assets 45(f) 114,971 5,746 120,717EquityRevaluation and other reserves 6,192,395 (45) 6,192,350Retained earnings 1,779,394 (15,567) 1,763,827Non-controlling interests 1,054,600 (14,236) 1,040,364Non-current liabilitiesDeferred tax liabilities 45(f) 266,931 35,594 302,525

THE COMPANYNotes




Rs’000January 1, 2018Non-current assetsProperty, plant and equipment 45(c) 5,289,848 519 5,290,367Financial assets at amortised cost - - Loss allowance 45(d) - (465,987) (465,987) - Deferred project written off 319,457 (16,099) 303,358Invesment in associate 11,463 (6,176) 5,287Deferred tax assets 45(f) 23,081 3,078 26,159Current assetsOther financial assets at amortised cost - Loss allowance 45(d) - (24,073) (24,073) - Land under development 45(c) 226,048 291,964 518,012Non-current assets held for sale 45(c) 32,949 31,955 64,904EquityRevaluation and other reserves 5,119,709 - 5,119,709Retained earnings 4,454,100 (653,192) 3,800,908Current liabilitiesTrade and other payables 45(c) 190,251 451,205 641,456January 1, 2017Non-current assetsDeferred tax assets 45(f) 17,355 2,314 19,669EquityRevaluation and other reserves 5,499,947 - 5,499,947Retained earnings 3,459,269 2,314 3,461,583


(a) Impact on the financial statements (cont’d)

The impact on the retained earnings is as follows:

(b) IFRS 9 Financial Instruments

(i) Classification and measurementEquity investments previously classified as available-for-saleThe Group elected to present in OCI changes in the fair value of all its equity investments previously classified as available-for-sale, because these investments are held as long-term strategic investments that are not expected to be sold in the short to medium term.

Available-for-sale debt instruments classified as FVOCIListed and unlisted bonds were reclassified from available for sale to FVOCI, as the Group’s business model is achieved both by collecting contractual cash flows and selling of these assets. The contractual cash flows of these investments are solely principal and interest.

Reclassification from investment in associate to FVOCIThe Group elected to present in OCI investments previously classified investment in associate following dilution of its interest in the associate, loss of significant influence and because the investment is held as long-term strategic investment that are not expected to be sold in the short to medium term.

Reclassifications of financial instruments on adoption of IFRS 9On the date of initial application, January 1, 2018, the financial instruments of the Group were as follows, with any reclassifications noted:

THE GROUPRs’000

THE COMPANYRs’000

Retained earnings December 31, 2017 1,622,774 4,454,100Adjustments from adoption of IFRS 9 (396,215) (490,060)Adjustment from adoption of IFRS 15 (149,685) (126,767)Change in deferred tax (14,779) 3,078Impairment of associate - (6,176)Deferred project written off (42,926) (33,267)Restated retained earnings January 1, 2018 1,019,169 3,800,908






(b) IFRS 9 Financial Instruments (cont’d)

(i) Classification and measurement (cont’d)

Measurement category Carrying amount

THE GROUP Original(IAS 39/28)

New(IFRS 9)

OriginalRs’000

NewRs’000

DifferenceRs’000

Non-current financial assetsEquity securities Available-for-sale FVOCI 174,774 174,774 -Investmnet in associate Equity accounting FVOCI 882,875 882,875 -Listed and unlisted debt securities Available-for-sale FVOCI 124,292 124,292 -

Receivable from related parties Amortised cost Amortised cost 1,177,955 832,745 345,210Other receivables Amortised cost Amortised cost 319,457 319,457 -

Current financial assetsTrade receivables Amortised cost Amortised cost 746,230 746,230 -Other receivables Amortised cost Amortised cost 577,111 532,039 45,072Receivable from related parties Amortised cost Amortised cost 993,324 993,324 -

Measurement category Carrying amount

THE COMPANY Original(IAS 39)

New(IFRS 9)

OriginalRs’000

NewRs’000

DifferenceRs’000

Non-current financial assetsEquity securities Available-for-sale FVOCI 4,481 4,481 -Receivable from related parties Amortised cost Amortised cost 1,285,050 819,063 465,987Other receivables Amortised cost Amortised cost 319,457 319,457 -

Current financial assetsTrade receivables Amortised cost Amortised cost 60,973 60,973 -Other receivables Amortised cost Amortised cost 270,545 246,472 24,073Receivable from related parties Amortised cost Amortised cost 4,582,181 4,582,181 -


(b) IFRS 9 Financial Instruments (cont’d)

(ii) Impairment of financial assets (cont’d)

Trade receivablesThe Group applies IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. This resulted in an increase of the loss allowance on January 1, 2018 by Rs.390,282 for the Group and Rs.490,060 for the Company.

The loss allowance of the Company increased by a further Rs’000 64 to Rs’000 490,124 during the current reporting period and the loss allowance of the Group remained unchanged.

(c) IFRS 15 Revenue from Contracts with customers

The following adjustments were made to the amounts recognised in the balance sheet at January 1, 2018.


THE GROUP

IAS 18 carrying amount

December 31, 2017

Rs’000Reclassification

Rs’000Remeasurements

Rs’000

IFRS 15 carrying amount

January 1, 2018Rs’000

Trade receivables 1,642,798 (896,568) - 746,230Other non-current financial assets at amortised cost - 319,457 - 319,457Other current financial assets at amortised cost - 577,111 291,964 869,075Other non-current assets - Property, plant and equipment 16,651,091 - 8,897 16,659,988 - Non-current asset held-for-sale 45,842 - 31,955 77,797Trade and other payables 1,029,005 - 482,501 1,511,506

THE COMPANY

IAS 18 carrying amount

December 31, 2017

Rs’000Reclassification

Rs’000Remeasurements

Rs’000

IFRS 15 carrying amount

January 1, 2018Rs’000

Trade receivables 625,828 (564,855) - 60,973Other non- current financial assets at amortised cost - 294,310 - 294,310Other current financial assets at amortised cost - 270,545 291,964 562,509Other non-current assets - Property, plant and equipment 5,289,848 - 519 5,290,367 - Non-current asset held-for-sale 32,949 - 31,955 64,904Trade and other payables 190,251 - 451,205 641,456

(ii) Impairment of financial assets

Trade and other receivable arising from sale of sugar, electricity, ethanol, and provision of logistics and accomodation revenue are subject to IFRS 9’s new expected credit loss model:

The Group was required to revise its impairment methodology under IFRS 9 for each of these classes of assets. The impact of the change in impairment methodology on the Group’s retained earnings and equity is disclosed above.

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was immaterial.





(d) Deferred tax (cont’d)

The effect of change in effective tax rate is as follows:

The effect on the Statement of Profit or Loss and Other Comprehensive Income is as follows:

THE GROUP Net deferred tax liability

Rs’000

Revaluation and other reserves

Rs’000

Retained earnings

Rs’000

Owners’ Interest Rs’000

Non- controlling

Interest Rs’000

Total Rs’000

Balance as reported at January 1, 2017- As previously stated 151,960 6,192,395 1,779,394 8,766,832 1,054,600 9,821,432- Effect of change in the effective tax rate 29,848 (45) (15,567) (15,612) (14,236) (29,848)- As restated 181,808 6,192,350 1,763,827 8,751,220 1,040,364 9,791,584

Balance as reported at January 1, 2018- As previously stated 218,143 8,561,991 1,622,774 10,979,808 1,050,023 12,029,831- Effect of change in the effective tax rate on figures as at January 1, 2017 29,848 (45) (15,567) (15,612) (14,236) (29,848)

- Effect of change in the effective tax rate on figures as at January 1, 2018 1,096 7 788 795 (1,891) (1,096)

- As restated 249,087 8,561,953 1,607,995 10,964,991 1,033,896 11,998,887

THE COMPANYDeferred tax

assetRs’000

Actuarial lossesRs’000

Retained earningsRs’000

Total equityRs’000

Balance as reported at January 1, 2017- As previously stated (17,355) (118,062) 3,459,269 9,754,259- Effect of change in the effective tax rate (2,314) - 2,314 2,314- As restated (19,669) (118,062) 3,461,583 9,756,573

Balance as reported at December 31, 2017- As previously stated (23,081) (128,157) 4,454,100 10,368,852- Effect of change in the effective tax rate on 2016 figures (2,314) - 2,314 2,314- Effect of change in the effective tax rate on 2017 figures (764) - 764 764- As restated (26,159) (128,157) 4,457,178 10,371,930

THE GROUP THE COMPANY Owner’s Interest

2017 Rs’000

Non-controlling interest

2017Rs’000

2017Rs’000

Increase/(decrease) in tax charge and decrease in profit for the year 788 (1,894) 764

Decrease in deferred tax on remeasurements of post employment benefit obligations and increase in other comprehensive income for the year 7 3 -

Increase/(decrease) in total comprehensive income for the year 795 (1,891) 764

THE GROUPAs reported under

IFRS 15Rs’000

EffectRs’000

As would have been reported

Rs’000Revenue 4,245,171 (43,329) 4,201,842Other operating expense (4,263,474) 20,411 (4,243,063)Other operating income 44,411 - 44,411Other non-operating income 128,360 (104,808) 23,552Loss for the year (402,330) (127,726) (530,056)

Total Equity 10,906,574 (127,726) 10,778,848

THE COMPANYAs reported under

IFRS 15Rs’000

EffectRs’000

As would have been reported

Rs’000Revenue 217,348 - 217,348Other operating income 3,013 - 3,013Other non-operating income 128,360 (104,808) 23,552Loss for the year (24,702) (104,808) (129,510)

Total Equity 9,699,193 (104,808) 9,594,385


(c) IFRS 15 Revenue from Contracts with customers (cont’d)

Had the Group continued to report in accordance with IAS 18 Revenue for the year ended December 31, 2018, it would have reported the following amounts in these financial statements:




(d) Deferred tax

Change in effective tax rateFollowing a review of the effective tax rate in line with the definition within the Income Tax Act 1995, the 2% Corporate Social Responsibility (CSR) is regarded as a tax and is therefore subsumed within the Statement of Comprehensive Income.

Since the Company has tax losses carried forward, it is not liable to neither income tax nor to CSR. The impact of the change in effective tax rate is only on deferred tax liabilities.

The main reasons for the differences is ‘The identification of additional performance obligations in certain consultancy contracts and the recognition of the revenue on some of those performance obligations at a point in time rather than over time under IAS 18.’


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