Annual Financial Statements


Financial Statements for the year ended 31 March 2013


1.  
Consolidated
Total
Land,
improvements
and buildings
Plant and
equipment
Vehicles
and other
Capitalised
leases
Capital
work in
progress
             
Carrying value at beginning of year 9 026  2 420  4 344  1 816  63  383 
Additions 924  92  284  416  130 
Disposals (15) (10) (2) (3)      
Depreciation (472) (59) (272) (138) (3)   
Transfers    10  94  21     (125)
Currency alignment 831  345  258  200  23 
Transfer to intangible  assets (7)       (7)      
Carrying value at end of year  10 287  2 798  4 706  2 305  67  411 
             
Comprising:
31 March 2013
At cost 
13 952  3 281  7 061  3 101  98  411 
Accumulated depreciation  3 665  483  2 355  796  31    
   10 287  2 798  4 706  2 305  67  411 
31 March 2012
At cost 
12 171  2 796  6 455  2 446  91  383 
Accumulated depreciation  3 145  376  2 111  630  28    
   9 026  2 420  4 344  1 816  63  383 
             
Company                   
Carrying value at beginning of year  2 439  477  1 629  166  166 
Additions  331  108  48  164 
Disposals  (13) (10)    (3)      
Depreciation  (172) (7) (139) (25) (1)   
Transfers     61  12     (81)
Transfer to intangible  assets  (7)       (7)      
Carrying value at end of year  2 578  477  1 659  191  249 
             
Comprising:
31 March 2013
At cost 
4 729  581  3 456  437  249 
Accumulated depreciation  2 151  104  1 797  246    
   2 578  477  1 659  191  249 
             
31 March 2012
At cost 
4 435  574  3 293  398  166 
Accumulated depreciation  1 996  97  1 664  232    
   2 439  477  1 629  166  166 
 

Plant and machinery of Mozambique and Zimbabwe subsidiaries with a book value of R748 million (2012: R957 million) are encumbered as security for the secured long-term borrowings and certain short-term borrowings of R92 million (2012: R132 million).

The register of land and buildings is available for inspection at the company’s registered office.

   
2.
GROWING CROPS (Rmillion) Consolidated Company
   2013  2012  2013  2012 
         
Carrying value at beginning of year   3 575  2 608  613  363 
Gain arising from physical growth  and price changes  418  375  164  102 
Increase due to increased area under cane  107  135  107  122 
Expenditure on new area  157  57  125  57 
Decrease due to reduced area under cane  (57) (45) (6) (31)
Currency alignment  383  445       
Carrying value at end of year  4 583  3 575  1 003  613 
         
The carrying value comprises:        
Roots  2 289  1 668  705  367 
Standing cane  2 294  1 907  298  246 
   4 583  3 575  1 003  613 
         
Area under cane (hectares):        
South Africa  34 011  25 013  34 011  25 013 
Mozambique  25 352  24 675       
Swaziland  3 838  3 840       
Zimbabwe  27 978  28 432       
   91 179  81 960  34 011  25 013 
 

In terms of IAS 41: Agriculture, sugar cane growing crops are accounted for as biological assets and are measured and recognised at fair value. Changes in the fair value, replanting and agricultural operating costs incurred are included in profit or loss.

  • The fair value of roots is determined on a current amortised cost basis, which is adjusted for cost increases. The amortisation takes place over the life of the roots (between approximately 6 and 12 years).
  • The fair value of standing cane is determined by the growth of the cane, the yield, sucrose content, selling prices (including specifics such as European Union exports), less costs to harvest and transport, over-the-weighbridge costs and costs into the market.

The statement of financial position reflects the following in respect of growing crops:

  2013 2012
  South Africa Swaziland Zimbabwe Mozambique Total
Roots            
Hectares under cane 34 011 3 838 27 978 25 352 91 179 81 960
Amortised root value (Rand per hectare) 20 732 13 658 24 418 33 475 25 108 20 355
Cane            
Hectares for harvest 27 659 3 740 26 947 24 623 82 969 77 739
Standing cane value (Rand per hectare) 10 763 31 279 38 663 33 996 27 644 24 522
Yield            
Tons cane per hectare 66 125 100 86 86 86
Statement of Financial Position (Rmillion)            
Roots 705 52 683 849 2 289 1 668
Standing cane 298 117 1 042 837 2 294 1 907
Total 1 003 169 1 725 1 686 4 583 3 575
             
Rmillion 2013 2012        
Carrying value at beginning of year 3 575 2 608        
Change in fair value * 468 465        
Foreign currency translation 383 445        
Expenditure on new area 157 57        
Carrying value at end of year 4 583 3 575        
             
The IAS 41 fair value change included in profit or loss for the year ended 31 March 2013 is as follows:
             
Rmillion 2013 2012        
Roots 303 201        
Standing cane 165 264        
Change in fair value * 468 465        
             
Rmillion 2013 2012        
South Africa 265 191        
Swaziland 15 21        
Zimbabwe 78 214        
Mozambique 110 39        
Change in fair value * 468 465        
 
   
This represents the gross change in fair value. The agricultural costs actually incurred in generating this increase in fair value are
   
   
3. LONG-TERM RECEIVABLES, PENSION FUND ASSET AND PREPAYMENTS (Rmillion)
 
  Consolidated Company
  2013  2012  2013  2012 
Long-term receivables         
Defined benefit pension fund asset and employer surplus account (refer to note 31) 515  469  515  469 
Less current portion of employer surplus account allocation  (60) (60) (60) (60)
Carrying value at end of year  455  409  455  409 
Prepayments         
Contribution to the BEE Employee Share Ownership Plan  136  136  132  132 
Contribution to the BEE Management Share Ownership Plan  91  91  78  78 
  227  227  210  210 
Less accumulated amortisation at end of year  (193) (156) (180) (145)
At beginning of year  (156) (114) (145) (106)
Charge for the year  (37) (42) (35) (39)
Less BEE share ownership plan consolidation shares  (34) (71)    
      30  65 
Carrying value at end of year  455  409  485  474 
   
  The prepayment relates to awards made in terms of the company’s BEE employee share ownership plans, details of which are set out in note 34.
   
   
4.
GOODWILL (Rmillion) Consolidated    
  2013 2012    
         
Carrying value at beginning of year 260 230    
Currency exchange rate changes 40 30    
Carrying value at end of year 300 260    
   
  Goodwill is attributable to the Mozambique and Zimbabwe sugar operations and a Botswana and a Namibian subsidiary. Goodwill is tested annually for impairment. The recoverable amount of goodwill was determined from the "value in use" discounted cash flow model. The value in use cash flow projections, which cover a period of five years, are based on the most recent budgets and forecasts approved by management and the extrapolation of cash flows, which incorporate growth rates consistent with the average long-term growth trends of the market. As at 31 March 2013, the carrying value of goodwill was considered not to require impairment.
   
   
5.
INTANGIBLE ASSETS (Rmillion) Consolidated Company
  2013 2012 2013 2012
Cost:        
At beginning of year 89 50 83 45
Additions 15 20 15 20
Transfer from property, plant and equipment 7 18 7 18
Currency alignment   1    
At end of year 111 89 105 83
         
Accumulated amortisation:        
At beginning of year 24 18 19 14
Charge for the year 9 5 9 5
Currency alignment   1    
At end of year 33 24 28 19
Carrying value at end of year 78 65 77 64
         
The carrying value comprises:        
Software 59 28 59 27
Patents and licences 17 34 16 34
Cane supply agreements 2 3 2 3
  78 65 77 64
   
   
   
6.
INVESTMENTS (Rmillion)    
  Consolidated Company
  2013 2012 2013 2012
         
Unlisted shares at cost 13 11    
Loans 1 1    
Carrying value of investments (Directors’ valuation) 14 12    
   
  A schedule of unlisted investments is available for inspection at the company’s registered office.
   
   
7. SUBSIDIARIES AND JOINT VENTURES (Rmillion)
 
  Company
  2013  2012 
     
Shares at cost,  less amounts written off 4 397  4 397 
Indebtedness by 809  514 
Indebtedness to (665) (366)
  4 541  4 545 
 

Details of principal subsidiary companies and joint ventures are included in note 26.

Tongaat Hulett’s proportionate share of the assets, liabilities and post-acquisition reserves of joint ventures, which comprise in the main, Effingham Development (33%) and Tongaat Hulett/IFA Resort Developments (50%) and which are included in the consolidated financial statements are set out below.

 
  Consolidated
  2013  2012 
     
Property, plant and equipment 
Current assets  208  238 
Current liabilities  (47) (52)
Interest in joint ventures  167  193 
     
Tongaat Hulett’s proportionate share of the trading results of the joint ventures is as follows:     
Revenue  18 
Profit before tax  (2)
Tax  (2)
Net (loss)/profit after tax  (1)
     
Tongaat Hulett’s proportionate share of cash flows of the joint ventures is as follows:     
Cash flows from operating activities  18 
Net cash used in investing activities  (6) (2)
Movement in net cash resources  (5) 16 
   
   
8.
INVENTORIES (Rmillion)  Consolidated Company
  2013  2012  2013  2012 
         
Raw materials  389  251  269  217 
Work in progress  17  21  16  20 
Finished goods  217  192  135  103 
Consumables  637  492  136  131 
Development properties  493  441     
Livestock and game  105  86     
  1 858  1 483  556  471 
   
  Included in raw materials is an amount of R209 million (2012: R157 million) that relates to the constructive obligation that has been recognised on maize procurement contracts.
   
   
9.
DERIVATIVE INSTRUMENTS (Rmillion) Consolidated Company
  2013  2012  2013  2012 
The fair value of derivative instruments at year end was:          
         
Forward exchange contracts - hedge accounted  (6) (6)
Futures contracts - hedge accounted  (10) (10)
  (16) (16)
         
Summarised as:        
Derivative assets     
Derivative liabilities  (16) (1) (16) (1)
  (16) (16)
   
  Further details on derivative instruments are set out in note 25.
   
   
10. CASH AND CASH EQUIVALENTS
   
  Cash and cash equivalents include cash on hand, cash on deposit and cash advanced, repayable on demand and excludes bank overdrafts.