ANNUAL REPORT

Transcription

1 ANNUAL REPORT

2 CORPORATE INFORMATION Mr Preetam Boodhun (Chairperson) Board of Directors Mr Preetam Boodhun (Chairperson) Mr Gansam Boodram Mr Sachin Kumar Sumputh Mr Uttam Junkeesaw Mr Soobeersen Sanmukhiya Mr Thierry Desiré Laval Govinden Mr Yousouf Oodally Mr Bhagwat Parsadsing Daumoo Mr Feroze Peerboccus Bankers Mr Omduthsing Sookaye (Officer in Charge) State Bank of Mauritius Ltd Mauritius Commercial Bank Ltd Afrasia Bank Barclays Bank Ltd Banque des Mascareignes Ltée The Hong Kong and Shanghai Banking Corporation Ltd National Commercial Bank Ltd Mauritius Post and Cooperative Limited Bank One Officer in Charge Mr Omduthsing Sookaye, FCCA Registered Office Ground Floor, NG Tower, Cybercity, Ebène Secretaries, Registrar and Transfer Office SIT Corporate & Secretarial Services Ltd Legal Advisor Me Dheerendra Kumar Dabee, GOSK, SC Me Takeswarnath (Vishal) Jugoo ANNUAL REPORT 2015 Auditors KPMG

3 TABLE OF CONTENTS Vision and Mission Statement 2 Chairman s Message 3 Management Report 5 Statutory Disclosures 12 Corporate Governance Report 17 Statement of Compliance 33 Statement of Directors Responsibilities 35 Secretary s Certificate 36 Independent Auditors Report to the Members 37 Statement of Financial Position 39 Statement of Comprehensive Income 40 Statement of Changes in Equity 41 Statement of Cash Flows 43 Notes to the Financial Statements 44 1

4 ANNUAL REPORT 2015 Our Vision To be among the leading companies through sustainable investments in key viable economic sectors that support capital appreciation and ensure consistent income streams. Our Mission To be recognised as the leading organisation in economic empowerment through our drive for excellence, creation and distribution of wealth. Core Values INTEGRITY PROFESSIONALISM TEAMWORK PASSION COMMITMENT } CORE VALUES } CUSTOMER FOCUS DILIGENCE DEDICATION ATTENTIVENESS Our Overriding Objective The overriding objective of the Board and Management is to ensure the company s financial stability, profitability, growth and sustainability to maximize shareholders wealth with a view to providing an enhanced and consistent dividend distribution and appreciation of share value to all shareholders. 2

5 CHAIRMAN S MESSAGE - SIT Dear Shareholders As the new Chairperson, I am proud to be part of a dedicated team and assure you all that I will be an integral contributor for the success and prosperity of the company. Following the recent election of directors in November 2015, a new Board has been constituted. With an endeavour to meet the expectations of the shareholders, new foundations will be laid, based principally on integrity, prudence and transparency. It is noted that 2015 was a year of change and challenge for both SIT and its Group of Companies. The most pressing ones are the local cane industry, where a gradual erosion of profitability is eminent, forthcoming abolishment of sugar quota and the prevailing economic conditions. In this respect, the challenge lies in consolidating the SIT Group to continue persevering in the development of its existing pillars of growth and revenue and on new ones being developed, to ensure change and sustainability in the face of a continuing challenging future. It is expected for the forthcoming year an improved cash flow, a stronger balance sheet and profits from all our projects. GROUP S FINANCIAL RESULTS At company level, a loss for the year of around Rs 61 million was recorded as compared to a profit of around Rs 116 million last year. This is mainly attributed to the impairment of non performing assets and excessive finance costs. At group level, a profit for the year, of around Rs 88 m has been recorded due to the share of result of associate. The company has exceptionally, not declared a dividend for the year under review as the Company and its Group are running through a shortfall in the cashflow. At company level, while the current assets have increased and the current liabilities too have increased due to an increase in bank overdrafts. The total assets of the Group stood at around Rs 8 billion for the year under review, as compared to Rs 7 billion in The increase in the assets value has been mainly due to the cost of infrastructure in Aurea Project, which has been capitalized and for fair value of investments. The net assets of the Group has slightly increased from Rs 3.8 billion in 2014 to Rs 3.9 billion in The increase is mainly due to profits recognized from the associated company (Omnicane Holdings Limited). FUTURE INVESTMENT Looking ahead SIT Group will concentrate its efforts in the quest for a better future to add value to shareholders wealth and consideration for stakeholders: Residential Morcellement projects / Property development The group is prospecting the implementation of a residential morcellement project at Deux Bras on 61 acres of land. Approximately 600 residential plots of land will be offered for sale. The masterplan for this development is being finalised and reservations from potential buyers are expected early

6 ANNUAL REPORT 2015 Aeolian Project At Plaine Des Roches SIT has participated with its strategic partner Aerowatt (Mauritius) Ltd, in the 9.35 MW Aeolian Project at Bras D Eau, Plaine des Roches. Its shareholding amounts to 49% while that of Aerowatt is 51%. The Project is nearly completed and this year instead of going up the winds, we will walk with the winds. Photovoltaic Project SIT another vital investment in a 4 MW solar farm to the tune of 49%, whilst Synnove Energy Ltd holding the remaining 51%. The Energy Supply and Purchase Agreement (ESPA) has already been secured and the solar farm is expected to be operational in Investigation of new ventures in core competencies (agriculture/commercial nursery) SIT Landscape Contracting Services Ltd (SLCSL), a subsidiary company, has been set up to offer landscaping contracting services essentially to the Group. In future, the company will develop into a commercial business entity. ACKNOWLEDGEMENT I express my appreciation to the previous Board for their strategic guidance, the management and employees for their cohesion, dedication and hard work, despite the challenges being faced by the Group. Moreover, I wish to thank the shareholders for their continuous support and confidence in SIT Group. Preetam Boodhun Chairperson Sugar Investment Trust 4

7 MANAGEMENT REPORT 1 OVERVIEW The Sugar Investment Trust is a body corporate established in 1994 by an Act of Parliament, the Sugar Industry Efficiency Act. It operates on a commercial basis under the Companies Act SIT was initially set up as a participation scheme offering sugar cane planters and employees of the sugar industry the unique opportunity to participate in the ownership of sugar milling companies through equity. The company s investments ensued with participation in the equity of power generating companies and setting its foot in the leisure sector with the setting up and operation of a water-theme park. Over the past years, the Group has evolved over a series of bold measures, strategies and decisions taken to gear the Group away from the uncertainties in the sugar industry towards more prosperous waters. Indeed, the Group has reached new heights and built on a stronger portfolio of activities in the property development sector and renewable energy sector. The Group is further pursuing its investment diversification strategy with a view to ensuring medium to long term growth, sustainability, profitability, capital appreciation and an enhanced and consistent income stream for the Group and the Shareholders. Accordingly, the Group has identified several new and promising economic sectors bearing the potential for investment. Renewable Energy is one such sector. 2 FINANCIAL PERFORMANCE With the new day comes new strength and new thoughts. Eleanor Roosevelt GROUP AND COMPANY RESULTS Group The turnover increased from Rs189 million in 2014 to Rs 232 million for this financial year, mainly because there has been an increase in Sugar proceeds following the government grant of Rs 2,000 per ton of sugar. Furthermore, there has been compulsory acquisition of land by the government which has led to increase in turnover. The group has not yet recognised the revenue from the Aurea Project given that the project has been delayed for more than 2 years and completed in May This delay was further accentuated due to various anomalies discovered post receipt of Morcellement permit and same was rectified to prevent loss for the SIT Group vis-avis its clients. Finalisation of deed of sale with clients will start in December Company The company has made a loss of Rs 61 million for the financial year This was mainly due to impairment of non performing investments and high finance costs. 5

8 ANNUAL REPORT 2015 GROUP TURNOVER The trend for the group turnover since 2010 is as shown below. GROUP TURNOVER AND PROFITS 500,000 Rs' , , , , Turnover Profits Highlights on Group revenues The charts below show the percentage contribution of the different components to the Group s turnover. GROUP REVENUES Other Revenue Sales of land Proceeds from Sugar, molasses and other products Dividend receivable - 40,000 80,000 Rs' 000 The Group s principal income drivers include sale of land through agricultural and residential morcellements, dividends from investee companies, sugar proceeds from cane growing activities and rental of office spaces. Sale of land through agricultural and residential morcellements The sale of land has been mainly compulsory acquisition by Government for the Terre Rouge Verdun link road. Furthermore, AUREA project has been delayed for more than 2 years and Morcellement Permit was received in May 2015, but following unforeseen events it has been delayed further and same is expected to be finalised and released to clients in December Dividend Income Dividend income has been the major source of income for SIT and there has been a slight decrease in dividend income, Rs138 million for 2015 as compared to Rs144 million in

9 Sugar and other agricultural activities Proceeds from sugar and other agricultural activities have increased from Rs 68 million in 2014 to Rs 73 million in The main contributor has been the government grant of Rs 2,000 per ton of sugar and a better yield for Crop Rental and others The rental income comprise of office rented in NG Tower and The Core, these are fitted and shell and core spaces. For The Core, 80% of the overall space was rented for the financial year 2015, whereas for NG Tower, 70% of the spaces were rented. Leisure The Group had virtually no income from the Waterpark s operations owing to cessation of activities in October OPERATING EXPENSES Operating expenses relate mainly to cane growing and sugar related activities undertaken by our subsidiary, SIT Land Holdings Ltd (SITLH), and the cost of operations of Le Waterpark and Leisure Village by our subsidiary, SIT Leisure Ltd (SITL). The operating expenses of SITLH have slightly decreased in 2015 to Rs 84 million as compared to Rs 86 million in GROUP NET ASSETS AND DEBTS The Group s net asset per share has improved to Rs in This increase is mainly due to the better share of associated company (Omnicane Holdings Ltd). An increase in total assets from Rs 7.1 billion in 2014 to Rs 7.8 billion in 2015 has been noted due to increase in fair value of investments. We have also noted a massive increase in the level of debts for the Group reaching Rs 1.8 billion for 2015 as compared to Rs1.2 billion in The increase in debts and delays in maturing projects has led to major increase in finance costs over the past years. The trend of the Group, Total Assets Net Assets and Debts since 2010 is as shown below. 10,000,000 8,000,000 GROUP TOTAL ASSETS AND DEBTS Rs' 000 6,000,000 4,000,000 2,000, Total Assets Net Assets Debts 7

10 ANNUAL REPORT 2015 INVESTMENTS The following bar-chart presents the Group s Investment for the financial years 2015 and 2014: Rs' 000 1,000, ,000 - Sugar Milling Cane Growing Energy Others Investment in cane growing denotes the fair value of the associate Omnicane Holdings Limited. The fair value of the investment Omnicane Holdings Ltd finalised has slightly decreased from Rs1.4 billion to Rs1.2 billion. Whereas an increase has been noted in the valuation of the energy sector from Rs 847 million in 2014 to Rs 1.1 billion in Sugar milling investment represents only the fair valuation of the performing milling companies. The fair values of these investments have fallen by from Rs 432 million in 2014 to Rs 288 million in RESULTS AND UNDERTAKINGS OF SIT LAND HOLDINGS LTD (SITLH) 1. SUGAR CANE CULTIVATION Crop 2014 Island wide Overview It is to be noted that it is the first time in our Sugar Industry history that the cane crop harvest for 2014 ended on the 2nd February 2015 with the lowest extraction rate over the last 6 years with a mean of 9.91%. This is mainly due to the strike in the sugar industry in December The result was that 1,479 Ha of standing cane could be harvested and the harvest postponed for crop For SIT Land Holdings Ltd, 3.75 Ha was left standing after crop 2014 which ended on 31 January As a whole for the island, an increase has been noted and tonnage of cane harvested was 4,044,422 tons for the crop year 2014 compared to 3,815,782 tons for crop year In 2014, 50,694 Ha of sugar cane was harvested compared to 53,464 Ha in Cane productivity was better in 2014 compared to 2013: tons per hectare in 2014 compared to tons per hectare in However, extraction rate was much lower 9.91% for 2014 compared to 10.62% for

11 A comparative cane yield analysis since the crop year 2009 is shown in the table hereunder. Year Area Harvested Cane Harvested Cane Yield Sugar Production Extraction Rate Sugar Yield Ha Tons Tons/Ha Tons % Tons/Ha ,380 4,667, , ,686 4,365, , ,668 4,230, , ,140 3,947, , ,464 3,815, , ,694 4,044, , SITLH , , Cane Harvest 2014 SITLH Cane harvest for SIT Land Holdings Ltd started on 06 June 2014 and ended on 31 January The harvest results and statistics have been summarised for all two estate areas in the following table. DETAILS MON TRESOR BRITANNIA TOTAL Area Harvested Ha Cane Produced Tons 21,902 19,433 33,644 27,638 55,546 47,071 Cane Yield Tons/Ha Sugar Produced Tons 2,202 2,071 3,396 2,941 5,598 5,012 Sugar Yield Tons/Ha Extraction Rates % PROJECT DEVELOPMENTS AGRICULTURAL DIVERSIFICATION PROGRAMME To withstand the cuts in the sugar price in the global market and the dismantling of all secured and guaranteed quotas with European Buyers and sustain its operational costs, the company is reconsidering its agricultural diversification programme. The company intends to undertake a study to investigate prospective agricultural produce and agri-business activities with a focus on value addition, optimal development of the land potential and generation of a sustainable and enhanced revenue stream. Operation of a Nursery The nursery of the Company at St. Avold, Britannia, is fully operational since Its main objective is to produce plants for the property development projects of the SIT Group. The plant population in the nursery is currently about 108,900 and comprises over 150 different species. 9

12 ANNUAL REPORT 2015 The Company also intends to develop the nursery into a business unit to commercialize plants to the general public in the very near future. SIT Landscaping Contracting Services Ltd SIT Landscape Contracting Services Ltd (SLCSL), an associated company, has been set up to offer landscaping contracting services essentially to the Group. This entity is presently undertaking the maintenance of the landscaping implemented at Aurea. The setting up of this company aimed at optimising our resources like land, labour and capital. In the future, the company shall develop into a commercial business entity. AGRICULTURAL MORCELLEMENT PROJECTS Domaine Ile D Ambre Agricultural Morcellement The Company launched an agricultural morcellement at Ile D Ambre in 2012 over a total extent of Arpents comprising 190 plots. The project was not successful, thus a new strategy to make the project more viable is under study. Lease of land Lease of land under Government Food Security Programme This project was initiated by the Ministry of Agro Industry, Food Production and Security under the Food Security Scheme. When requested to contribute to the project, SITLH provided 200 A of land on lease. The Ministry of Agro-Industry is, through its Project Implementation Unit (PIU), and AREU monitoring the agricultural projects being undertaken by these lessees. SITLH is also monitoring plot occupancy through regular field visits. PROPERTY DEVELOPMENT PROJECTS UNDERTAKEN BY OUR ASSOCIATE, SIT PROPERTY DEVELOPMENT LTD (SPDL) Property development, now the core business activity of the SIT Group, is undertaken by the SIT Property Development Ltd (SPDL), the development arm of the Group and associate of SITLH. Recently completed Real Estate Projects Aurea - Living Harmony, An integrated property development project at Highlands/Cote D Or Aurea Living Harmony, an upscale integrated property development project at Highlands/ Cote D Or launched in January 2012 consists of some 600 plots comprising serviced residential, commercial and light industrial plots. SPDL has received the Morcellement Permit on 13 May 2015 and the signature of deed of sale will start by December This was a major relief for the Group after the long way to rectify past events. 1) The CORE - Business Knowledge Centre at Ebene The CORE is a 21,000sq metres building rented for office/commercial use. As at November 2015, around 80% was reserved by renowned institutions. 10

13 Forthcoming Real Estate Projects 2) Real Estate Project under implementation 3) Residential Morcellement Project at Deux Bras The Associate SPDL is promoting a low-cost residential morcellement at New Grove/Deux Bras. This project will start early in RENEWABLE ENERGY PROJECTS Wishing to bring its contribution to the Government s policy of a sustainable Mauritius and in line with its vision for a green future for Mauritius and its endeavour to ensure the medium to long term growth, sustainability and profitability of the Group, SIT has decided to Go Green by prospecting viable green energy projects. Two such projects on which the Group is embarking are: a wind farm project at Plaine des Roches and a photovoltaic project. Aeolian project at Plaine des Roches SIT is participating with AEROWATT (France)/Quadran in a green energy project, a first of its kind in Mauritius which will comprise the construction and operation of a 9.35 MW wind farm at Bras D eau, Plaine des Roches. The project is nearly to be finalised and the Project is 85% complete as at October Our shareholding in the project will amount to 49%, while that of AEROWATT will be at 51%.We are all set to embark on the project we have already secured an ESPA (Energy Supply and Purchase Agreement) and leasehold rights over the land at Bras D Eau for the purpose of the project; the project is expected to be operational by February Photovoltaic project with Synnove Energy Ltd Synnove Energy Ltd (SEL), a US based company with an operational focus on producing clean renewable energy in Africa, has recently been awarded the contract in respect of the tender for a 4 MW photovoltaic project launched by the CEB. The company has already secured the Energy Supply & Purchase Agreement (ESPA) in this respect. SIT will have a shareholding of 49% in Synnove Solar (Mauritius) One Ltd which is a subsidiary of Synnove Energy Ltd. WAY TO AFRICA SITLH is targeting an investment prospect in Mozambique. This will comprise of a land base of 10,000 hectares, a milling Company, a distillery, a power producing company and agro-diversified products. I seize this opportunity to express gratitude to all Board members, staff and employees for their excellent and unflinching commitment to the Group s continued prosperity. Omduthsing Sookaye, FCCA Officer in Charge 11

14 ANNUAL REPORT 2015 STATUTORY DISCLOSURES - JUNE 30, 2015 The directors have the pleasure in submitting the Annual Report and Corporate Governance Report of Sugar Investment Trust (the Company ) and its subsidiaries (the Group ) together with the audited consolidated and separate financial statements for the year ended June 30, PRINCIPAL ACTIVITIES The principal activities of the Group are the holding of investments, sugar cane growing, operation of a leisure park and through the democratisation policy, selling of land to individuals as residential and agricultural morcellements. 2. DIRECTORS The directors who held office as at June 30, 2015 were as follows: THE COMPANY Mr Preetam Boodhun - Chairperson (Appointed on 25 November 2015) Mr Sachin Kumar Sumputh (Appointed on 25 November 2015) Mr Uttam Junkeesaw (Appointed on 25 November 2015) Mr Gansam Boodram Mr Sobeersen Sanmukhiya (Appointed on 5 November 2015) Mr Bhagwat Parsadsingh Daumoo (Appointed on 5 November 2015) Mr Yousouf Oodally Mr Thierry Desiré Laval Govinden (Appointed on 5 November 2015) Mr Feroze Peerboccus (Appointed on 5 November 2015) Representative of Planters Representative of Planters Representative of Planters Representative of Employees Representative of Employees Representative of Employees Directors ceasing to hold office during the year ended June 30, 2015: Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Vishnou Gondeea (Resigned on 25 November 2015) Mr Bal Rajsingh Sharma Bandhu (Resigned on 25 November 2015) Mr Anilkumarr Ramnundun (Resigned on 5 November 2015) Mr Krishna Kistnen (Resigned on 5 November 2015) Mr Joseph Benedict Marcellino Eustasie (Resigned on 5 November 2015) Mr Khemlall Rampersad (Resigned on 5 November 2015) THE SUBSIDIARIES SIT Leisure Ltd Mr Preetam Boodhun - (Appointed on 25 November 2015) Mr Yodhunsingh Daumoo Mr Krishna Sen Goojha Mr Anilkumarr Ramnundun Mr Gansam Boodram Mr Krishna Kistnen Mr Yousouf Oodally Mr Joseph Benedict Marcellino Eustasie Mr Khemlall Rampersad 12

15 STATUTORY DISCLOSURES - JUNE 30, 2015 Directors ceasing to hold office during the year ended June 30, 2015: Mr Heeranjay Sobrun (Resigned on 29 December 2014) Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Vishnou Gondeea (Resigned on 25 November 2015) SIT Land Holdings Ltd Mr Preetam Boodhun - Chairperson (Appointed on 25 November 2015) Mr Krishna Kistnen Mr Anilkumarr Ramnundun Mr Gansam Boodram Mr Sobeersen Sanmukhiya Mr Vijay Kumar Ramnundun Mr Gessavah Chengan Mr Joseph Benedict Marcellino Eustasie (Appointed on 6 February 2015) Mr Khemlall Rampersad (Appointed on 6 February 2015) Representative of Planters Representative of Planters Representative of Planters Representative of Employees Directors ceasing to hold office during the year ended June 30, 2015: Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Varoon Kumar Ramjuttun (Resigned on 17 December 2014) Mr Vishnou Gondeea (Resigned on 25 November 2015) SIT Property Development Ltd Mr Gansam Boodram - Chairperson Mr Yousouf Oodally Mr Gessavah Chengan Mr Sobeersen Sanmukhiya Mr Vijay Kumar Ramnundun Mr Krishna Kistnen (Appointed on 14 January 2015) Mr Anilkumarr Ramnundun (Appointed on 6 February 2015) Mr Khemlall Rampersad (Appointed on 6 February 2015) Mr Preetam Boodhun (Appointed on 25 November 2015) Directors ceasing to hold office during the year ended June 30, 2015: Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) Mr Siv Potayya (Resigned on 27 January 2015) Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Joseph Benedict Marcellino Eustasie (Resigned on 6 February 2015) Mr Vishnou Gondeea (Resigned on 25 November 2015) SIT Corporate & Secretarial Services Ltd Mr Preetam Boodhun - (Appointed on 25 November 2015) Mr Bal Rajsingh Sharma Bandhu Mr Anilkumarr Ramnundun Mr Krishna Kistnen Mr Yousouf Oodally Mr Joseph Benedict Marcellino Eustasie Mr Khemlall Rampersad 13

16 ANNUAL REPORT 2015 STATUTORY DISCLOSURES - JUNE 30, 2015 Mr Omduthsingh Sookaye (Appointed on 6 February 2015) Directors ceasing to hold office during the year ended June 30, 2015: Mr Vishnou Goondeea - (Resigned on 25 November 2015) Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Premsagar Bholah (Resigned on 14 January 2015) SIT Landscape Contracting Services Ltd Mr Gansam Boodram (Appointed on 6 February 2015) Mr Krishna Kistnen (Appointed on 6 February 2015) Mr Sobeersen Sanmukhiya Mr Gessavah Chengan Director ceasing to hold office for the year ended June 30, 2015: Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) SIT Ebène Property Development Ltd Mr Preetam Boodhun - (Appointed on 25 November 2015) Mr Omduthsingh Sookaye (Appointed on 6 February 2015) Directors ceasing to hold office for the year ended June 30, 2015: Mr Vishnou Goondeea - (Resigned on 25 November 2015) Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Mr Premsagar Bholah (Resigned on 6 February 2015) SIT Property Development Consultancy Ltd Mr Preetam Boodhun - (Appointed on 25 November 2015) Mr Omduthsingh Sookaye (Appointed on 6 February 2015) Directors ceasing to hold office for the year ended June 30, 2015: Mr Vishnou Goondeea - (Resigned on 25 November 2015 Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) Mr Premsagar Bholah (Resigned on 6 February 2015) SIT Syndicate Services Ltd Mr Omduthsingh Sookaye (Appointed on 6 February 2015) Director ceasing to hold office for the year ended June 30, 2015: Mr Premsagar Bholah (Resigned on 6 February 2015) NG Tower II Ltd, NG Tower III Ltd, NG Tower IV Ltd and NG Tower V Ltd Mr Gansam Boodram and Mr Omduthsingh Sookaye held office as directors in the above named four companies. Le Waterpark Leisure Ltd Mr Omduthsingh Sookaye (Appointed on 6 February 2015) 14

17 STATUTORY DISCLOSURES - JUNE 30, 2015 Directors ceasing to hold office for the year ended June 30, 2015: Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) Mr Premsagar Bholah (Resigned on 6 February 2015) Executive Café Ltd Mr Sobeersen Sanmukhiya Mr Omduthsingh Sookaye (Appointed on 6 February 2015) Director ceasing to hold office for the year ended June 30, 2015: Mr Premsagar Bholah (Resigned on 6 February 2015) 3. DIRECTORS REMUNERATIONS AND BENEFITS Remunerations and benefits received, or due and receivable from the Company and its subsidiaries are as follows: Rs 000 Rs 000 Sugar Investment Trust 8 Non-Executives (2014: 9) SIT Land Holdings Ltd 9 Non-Executives (2014: 9) SIT Property Development Ltd 9 Non-Executives (2014: 9) SIT Leisure Limited 9 Non-Executives (2014: 10) No emoluments were paid to directors of SIT Property Development Consultancy Ltd, Executive Café Ltd, SIT Ebène Property Development Ltd, SIT Syndicate Services Ltd, SIT Landscape Contracting Services Ltd, Le Waterpark Leisure Ltd, SIT Corporate and Secretarial Services Ltd, NG Tower II Ltd, NG Tower III Ltd, NG Tower IV Ltd and NG Tower V Ltd. 4. DONATIONS Rs 000 Rs 000 Donations made by the Company Donations made by Subsidiaries

18 ANNUAL REPORT 2015 STATUTORY DISCLOSURES - JUNE 30, AUDITORS REMUNERATION The fees payable to the Auditors for audit and other services for the year under review were: GROUP COMPANY Rs 000 Rs 000 Audit services Tax compliance services During the year, the Company changed auditors from BDO & Co to KPMG. Approved and authorised by the Board of Directors on 3 December 2015 and signed on its behalf by: Chairperson Director 16

19 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) COMMITMENT TO GOOD PRACTICE The Company is committed to the highest standard of business integrity, transparency and professionalism in all its activities to ensure that the activities within the Company are managed ethically and responsibly to enhance business value for all stakeholders. 2) HOLDING STRUCTURE 51% 1 Founder Share 100% 100% SIT Property Development Ltd Land Holdings Ltd A subsidiary of Sugar Investment Trust SIT Leisure Limited SIT Property Development Consultancy Ltd 100% 100% 100% Executive Café Ltd SIT Ebène Property Development Ltd SIT Syndicate Services Ltd 100% 100% 100% SIT Corporate and Secretarial Services Ltd SIT Landscape Contracting Services Ltd Le Waterpark Leisure Ltd 100% 100% 100% 100% NG Tower II Ltd NG Tower III Ltd NG Tower IV Ltd NG Tower V Ltd Note: During the year under review, the companies Coral Cove Resorts (Mtius) Ltd, Sir Seewoosagur Ramgoolam Botanical Garden Investment Co. Ltd, Le Bouchon Development Co. Ltd and Le Bouchon Hotel Development Co. Ltd were removed from the Register of Companies under Section 309 of the Companies Act. 17

20 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) COMMON DIRECTORS WITHIN THE SIT GROUP The table below provides an overview of common directorsappointed within the SIT Group as at June 30, SUBSIDIARIES COMMITTEES SUGAR INVESTMENTTRUST (SIT) SIT LEISURE LIMITED (SITL) SIT LAND HOLDINGS LTD (SITLH) SIT PROPERTY DEVELOPMENT LTD (SPDL) SIT CORPORATE AND SECRETARIAL SERVICES LTD NG TOWER II LTD NG TOWER III LTD NG TOWER IV LTD NG TOWER V LTD SIT EBENE PROPERTY DEVELOPMENT LTD SIT LANDSCAPE CONTRACTING SERVICES LTD SIT SYNDICATE SERVICES LTD SIT PROPERTY DEVELOPMENT CONSULTANCY LTD LE WATERPARK LEISURE LTD EXECUTIVE CAFÉ LTD AUDIT COMMITTEE (GROUP) CORPORATE GOVERNANCE COMMITTEE STAFF & REMUNERATION COMMITTEE CORPORATE SOCIAL RESPONSIBILITY STRATEGY & INVESTMENT COMMITTEE RISK COMMITTEE No Name of Director 1 Mr Vishnou Gondeea (As from 14 January 2015) Mr Bal Rajsingh Sharma Bandhu 5 3 Mr Gansam Boodram Mr Anilkumarr Ramnundun Mr Krishna Kistnen Mr Yousouf Oodally 5 7 Mr Joseph Benedict Marcellino Eustasie Mr Khemlall Rampersad Mr Sobeersen Sanmukhiya 10 Mr Vijay Kumar Ramnundun 11 Mr Gessavah Chengan 12 Mr Krishna Sen Goojha 13 Mr Yodhunsingh Daumoo 14 Mrs Divanandum Packiry P. Chinien 15 Mr Omduthsing Sookaye Mr Dayanand Koobrawa Mr Shailendrasingh Sreekeessoon(Up till 18 Mr Ashis Kumar Hoolass (Up till 14 January 2015) 19 Mr Varoon Kumar Ramjuttun (Up till 17 December 2014) 20 Mr SivPotayya (Up till 27 January 2015) 21 Mr Heeranjay Sobrun (Up till 29 December 2014) 22 Mr Ravin Premsagar Bholah (Up till 14 Jan 2015) Mr Chandan Lautan (Up till 21 July 2015) 18

21 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 Notes: 1 Appointed on 14 January Appointed on 06 February Appointed on 18 June Appointed on 02 June Appointed on 07 July Resigned on 06 February Resigned on 14 January ) DIRECTORS REPRESENTING SIT ON BOARD OF INVESTEE COMPANIES s/n Investee Companies Director(s) 1 Consolidated Energy Ltd Mr Omduthsing Sookaye 2 Alteo Energy Ltd Mr Khemlall Rampersad Mr Omduthsing Sookaye 3 Omnicane Holdings Ltd Mr Omduthsing Sookaye 4 Omnicane Ltd Mr Omduthsing Sookaye 5 Omnicane (Management & Consultancy) Ltd Mr Omduthsing Sookaye Mr Anilkumarr Ramnundun 6 Omnicane Milling Operations Ltd Mr Omduthsing Sookaye 7 Omnicane Thermal Energy Operations (La Baraque) Limited Mr Omduthsing Sookaye 8 Omnicane Thermal Energy Operations (St Aubin) Limited Mr Omduthsing Sookaye 9 Sugarworld Ltd Mr Omduthsing Sookaye 10 Terragen Ltd Mr Omduthsing Sookaye 11 Terragen Management Ltd Mr Omduthsing Sookaye 12 Eole Plaine des Roches Ltée Mr Gansam Boodram Mr Omduthsing Sookaye 13 Synnove Energy Ltd Mr Gansam Boodram Mr Omduthsing Sookaye 14 Synnove Solar (Mauritius) One Ltd Mr Gansam Boodram Mr Omduthsing Sookaye 5) PLANTERS AND EMPLOYEES REPRESENTING SIT ON BOARD OF DIRECTORS OF MILLING COMPANIES DURING THE YEAR s/n MILLING COMPANY PLANTER EMPLOYEES 1 Compagnie Usinière de Mon Loisir Limitée Mr Tejnarain Chumroo Mr Salim Soobadar 2 Deep River Beau Champ Milling Company Ltd Mr Kamless Seeam Mr Thierry Desire Laval Govinden 3 Alteo Milling Ltd Mr Bissoon Mungroo Mr Youlaganaden Maunick 4 Medine Sugar Milling Company Ltd Mr Gansam Boodram Mr Daramdev Jhunput 5 Omnicane Milling Holdings (Mon Tresor) Ltd Mr Madhoosoodun Motah Mrs Marie Audrey Sabine Auffray 6 Terra Milling Ltd Mr Khemlall Ramyad Mrs Bibi Nessa Joomun 19

22 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) SHAREHOLDERS HOLDING MORE THAN 5% OF THE CAPITAL OF THE COMPANY Shareholder No. Of Shares Percentage shareholding (%) The National Pensions Fund 41,263, MCB Equity Fund Ltd 25,992, Government of Mauritius 25,464, ) DIVIDEND POLICY The Company aims to ensure that its shareholders have a consistent return on their investments in the form of stable dividends except for 2015 due to non-availability of fund. The dividend cover and dividend yield trend over the past years as shown below: Year (Times) Dividend Cover Dividend Yield (%) ) THE BOARD OF DIRECTORS a) Composition The Board Composition of SIT is established under Section 5 of the Sugar Industry Efficiency Act, as amended ( SIE Act ). The Board of Directors shall consist of 9 persons of whom, 3 are elected by planters of the sugar industry, 3 are elected by employees of the sugar industry and 3 are appointed by the Minister from persons having wide experience in administrative, economic, financial or commercial matters, or in matters relating to the sugar industry. There were 8 directors serving the Company at year end and all of them were non-executive directors. They come from diverse business backgrounds and possess the necessary knowledge, skills, objectivity, integrity, experience and commitment to make sound judgments on various key issues relevant to the business of the Company independent of management. All directors receive timely information so that they are equipped to fulfil their duties in Board Meetings. All Board Members have access to the Company Secretary for any further information they require. The Company Secretary ensures that the Board Members receive appropriate training as necessary. Independent professional advice would be available to Directors in appropriate circumstances, at the Company s expense. 20

23 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 The Group has six Standing Board Committees namely the Audit Committee, Corporate Governance Committee, Staff & Remuneration Committee, Corporate Social Responsibility Committee, Strategy & Investment Committee and Risk Committee which meet regularly under the terms of references set by the Board. b) Profile of Directors Mr Vishnou Gondeea is a non-executive director and Chairperson of SIT Board since January He is one of the three directors appointed under Section 5 (2) (f) of the SIE Act, as amended. He currently serves as Permanent Secretary at the Ministry of Agro Industry & Food Security. He has more than 35 years of experience in the field of public administration and has worked in several Ministries. The latter holds a Diploma in Public Administration and Management. Me Bal Rajsingh Sharma Bandhu, Esq.is a non-executive director on SIT Board since 2012 and is one of the three directors appointed by the Ministry of Agro Industry & Food Security. He is a Barrister at Law and is the Head of Inner Chambers. He is also secretary to the Board of Bagged Sugar Storage Distribution. Mr Gansam Boodram was elected as representative of planters pursuant to the SIE Act 2001, as amended, and was appointed as non-executive director on the SIT Board. He is a professional in the agribusiness sector and acquired experience in Israel, Holland, USA and India. He graduated in agriculture with specialisation in soilless culture and protected cropping as well as agricultural management in Israel. He studied environmental control crop in Holland, mechanisation in USA and sugar technology in India. He is the Managing Director of Greenmundo (Africa). Mr Anilkumarr Ramnundun is a non-executive director who was elected as representative of planters in He has vast experience as planter in the sugar industry and is now a retired police officer to the rank of sub inspector after 36 years of service in the Mauritius Police Force. Mr Krishna Kistnen is a non-executive director and was elected in 2012 as representative of planters under the Section 5(2) (b) of the SIE Act, as amended. He is self-employed and has ample experience as planter in the sugar industry. Mr Yousouf Oodally is a non-executive director and was elected in 2012, as representative of employees under Section 5(2) (c) of the SIE Act, as amended. He is currently employed at Alteo Ltd and has 30 years of experience in the sugar industry. Mr Joseph Benedict Marcellino Eustasie is a non-executive director elected as representative of employees in 2012 under Section 5(2)(d) of the SIE Act, as amended. He is currently employed at Alteo Milling Ltd and has more than 20 years of experience in the sugar industry. Mr Khemlall Rampersad is a non-executive director who was elected in 2012 as representative of employees under Section 5(2)(e) of the SIE Act, as amended. He holds a Diploma in Business Administration and is the Managing Director of Residence Le Maho. He has ample experience in the sugar and tourism sector. 21

24 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 c) Attendance s/n Name of Board Member SUGAR INVESTMENT TRUST 1 Mr Vishnou Gondeea - Chairperson (Appointed on14 January 2015) SIT LEISURE LTD SIT LAND HOLDINGS LTD SIT PROPERTY DEVELOPMENT LTD 7/7 1/2 1/4 3/6 2 Mr Bal Rajsingh Sharma Bandhu 10/ Mr Gansam Boodram 11/11 5/5 5/5 10/10 4 Mr AnilKumarr Ramnundun 9/11 4/5 5/5 5/5 5 Mr Krishna Kistnen 11/11 5/5 4/5 6/6 6 Mr Yousouf Oodally 10/11 5/5-10/10 7 Mr Joseph Benedict M Eustasie 11/11 4/5 4/4 5/5 8 Mr Khemlall Rampersad 8/11 3/5 3/4 4/5 9 Mr Yodhunsingh Daumoo - 4/ Mr Krishna Sen Goojha - 1/ Mr Siv Potayya /4 12 Mr Vijay Kumar Ramnundun - - 3/5 5/10 13 Mr Sobeersen Sanmukhiya - - 4/5 10/10 14 Mr Gessavah Chengan - - 4/5 7/10 15 Mr Varoon Kumar Ramjuttun - - 1/1 - (Resigned on17 December 2014) 16 Mr Shailendrasingh 4/ /4 Sreekeessoon (Resigned on 19 December 2014) 17 Mr Ashis Kumar Hoolass 4/4 3/3 1/1 4/4 (Resigned on 14 January 2015) 18 Mr Heeranjay Sobrun (Resigned on 29 December 2014) - 3/3 - - d) Directors Interests in Shares The interests of the Directors in the Company and its subsidiary SIT Land Holdings Ltd (SITLH) are presented in the table below: s/n Name of Directors 1 Mr Vishnou Gondeea - Chairperson (Appointed on 14 January 2015) The Company-SIT Number of Ordinary Shares Subsidiary-SITLH Name of Directors Shares Direct Indirect Direct Indirect Nil Nil Nil Nil 2 Mr Bal Rajsingh Sharma Bandhu Nil Nil Nil Nil 3 Mr Gansam Boodram 26,500 25,500 15,000 Nil 4 Mr Anilkumarr Ramnundun 11,500 1,000 15,000 Nil 5 Mr Krishna Kistnen 4,000 Nil Nil Nil 6 Mr Yousouf Oodally 10,000 5,000 Nil Nil 22

25 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 s/n Name of Directors 7 Mr Joseph Benedict Marcellino Eustasie The Company-SIT Number of Ordinary Shares Subsidiary-SITLH Name of Directors Shares Direct Indirect Direct Indirect 4,000 Nil Nil Nil 8 Mr Khemlall Rampersad 8,200 Nil 15,000 30,000 9 Mr Sobeersen Sanmukhiya 227,900 95, ,000 1,001, Mr Vijay Kumar Ramnundun Nil Nil 30,000 60, Mr Gessavah Chengan 13,400 4,400 60,000 Nil 12 Mr Krishna Sen Goojha Nil Nil Nil Nil 13 Mr Yodhunsingh Daumoo 21,500 24,500 30,000 15, Mr Varoon Kumar Ramjuttun Nil Nil Nil Nil (Resigned on 17 December 2014) 15 Mr Heeranjay Sobrun (Resigned on Nil Nil Nil Nil 29 December 2014) 16 Mr Siv Potayya (Resigned on Nil Nil Nil Nil 27January 2015) 17 Mr Shailendrasingh Sreekeessoon Nil Nil Nil Nil (Resigned on 19 December 2014) 18 Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) Nil Nil Nil Nil The shares of the Company are not quoted on the Stock Exchange of Mauritius. e) Directors dealings There were no share dealings by directors within the Group, for the year under review. f) Board Charter The Board, as the governing body, fully understands its role, responsibility and authority in setting the direction, the management and control of the Company and has not adopted a board charter. 9) SENIOR MANAGEMENT PROFILE s/n Name/Title Qualifications 1 Mr Omduthsing (Pravesh) Sookaye Officer in Charge & Team Leader - Finance 2 Mr Dayanand (Rakesh) Koobrawa Team Leader - Administration & Human Resource 3 Mr Vadivel (Shiva) Moothy Team Leader - Agricultural Operations MSc (Hons) Financial Management, BSc (Hons) Accounting and Finance, FCCA MBA, BSc (Hons) Human Resource Management, Diploma in Occupational Safety and Health Management, HND Computer Studies Diploma Agriculture and Sugar Technology, Diploma in Management Studies 23

26 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 Interests in Shareholding s/n Name The Company- SIT Number of Shares Subsidiary-SITLH Number of Shares Direct Indirect Direct Indirect 1 Mr Omduthsing (Pravesh) Sookaye Nil Nil Nil Nil 2 Mr Dayanand (Rakesh) Koobrawa 5,000 Nil 15,000 Nil 3 Mr Vadivel (Shiva) Moothy 4,400 Nil 30,000 Nil 10) DIRECTORS REMUNERATION Monthly fees payable to the Chairperson and Directors of Sugar Investment Trust and its subsidiaries are summarised as follows: Positions Sugar Investment Trust (SIT) SIT Land Holdings Ltd (SITLH) SIT Property Development Ltd (SPDL) SIT Leisure Ltd (SITL) Rs Rs Rs Rs Chairpersons 24,000 16,000 16,000 16,000 Directors 8,000 8,000 8,000 8,000 No emoluments were paid to the Directors of SIT Corporate and Secretarial Services Ltd, Executive Café Ltd, SIT Property Development Consultancy Ltd, Le Waterpark Leisure Ltd, NG Tower II Ltd, NG Tower III Ltd, NG Tower IV Ltd, NG Tower V Ltd, SIT Landscape Contracting Services Ltd, SIT Ebène Property Development Ltd and SIT Syndicate Services Ltd. Total remuneration and other benefits received by each Director holding office during the year, for responsibility held, are listed next to their names. 24 s/n Name of Board / Committee Member SIT (Rs) Subsidiaries & Total (Rs) Committees (Rs) 1 Mr Vishnou Gondeea-Chairperson (Appointed on , , ,000 January 2015) 2 Mr Bal Rajsingh Sharma Bandhu 96,000 40, ,000 3 Mr Gansam Boodram 96, , ,000 4 Mr Anilkumarr Ramnundun 96, , ,000 5 Mr Krishna Kistnen 96, , ,000 6 Mr Yousouf Oodally 96, , ,000 7 Mr Joseph Benedict Marcellino Eustasie 96, , ,000 8 Mr Khemlall Rampersad 96, , ,000 9 Mr Sobeersen Sanmukhiya - 232, , Mr Vijay Kumar Ramnundun - 232, , Mr Gessavah Chengan - 192, , Mr Krishna Sen Goojha Mr Yodhunsingh Daumoo Mrs Divanandum Packiry P. Chinien - 120, , Mr Shailendrasingh Sreekeessoon 152, ,000 (Resigned on19 December 2014) 16 Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) 52, , , Mr Varoon Kumar Ramjuttun (Resigned on 17-56,000 56,000 December 2014) 18 Mr Siv Potayya (Resigned on 27 January 2015) - 56,000 56, Mr Heeranjay Sobrun (Resigned on 29 December 2014) - 104, ,000

27 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) BOARD COMMITTEES The Board is assisted in fulfilling its responsibilities by committees, namely the Corporate Governance Committee, Audit Committee, Strategy & Investment Committee, CSR Committee, Staff & Remuneration Committee and Risk Committee, which operate under clearly defined terms of reference and regularly report and recommend specific matters to the Board for approval. a) Corporate Governance Committee The Corporate Governance Committee acts as a useful mechanism for making recommendations to the Board on all corporate governance provisions to be adopted so that the Board remains effective and complies with the prevailing corporate governance principles. The Committee Members and attendance for the year under review are as follows: s/n Name Attendance 1 Mrs Divanandum Packiry P.Chinien (Chairperson) 3/3 2 Mr Anilkumarr Ramnundun 3/3 3 Mr Yousouf Oodally 1/3 4 Mr Joseph Benedict Marcellino Eustasie 2/3 5 Mr Omduthsing Sookaye (Appointed on 06 February 2015) - 6 Mr Premsagar Bholah (Resigned on 14 January 2015) 2/2 The Committee has the following responsibilities: Determine, agree and develop the Company s general policy on corporate governance in accordance with the Code of Corporate Governance; Ensure that disclosures are made in the annual report in compliance with the disclosure provisions of the code; Consult other non-executive directors in its evaluation of the Chairperson of the Board and the Chief Executive Officer; Regular review of the board structure, size and composition and make recommendations with regards to any adjustments that are deemed necessary; Make recommendations for the continuation (or not ) in services of any director who has reached the age of 70; Recommend directors retiring by rotation for re-election; Have due regard for principles of governance and code of best practice; Liaise with the Board in relation to the preparation of the committee s report toshareholders; Assessing the Board s relationships with Management and to recommend, where necessary, limits on Management s authority to act without explicit Board approval; and Considering recommendations regarding the appointment of the Chief Executive Officer of the Company. b) Audit Committee The Audit Committee meets regularly and consists of non-executive directors. The Company Secretary attends the meetings together with Management executives as and when required. The Committee Members for year under review and attendance were as follows: s/n Name Attendance 1 Mr Khemlall Rampersad (Chairperson) 6/6 2 Mr Bal Rajsingh Sharma Bandhu 6/6 3 Mr Sobeersen Sanmukhiya 6/6 4 Mr Vijay Kumar Ramnundun 4/6 25

28 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 The Committee has the following responsibilities: To monitor the integrity of the financial statements of the Company; To review financial statements prior to their approval; To review the company s internal financial control and the risk management systems; To monitor and review the effectiveness of the Company s internal audit function; To make recommendations to the Board in relation to the appointment of the external auditors and to approve the remuneration and terms of engagement of the external auditors; To monitor and review the external auditors independence, objectivity and effectiveness; To develop and implement policy on the engagement of the external auditors to supply non-audit services; and To assess and assure the quality of the risk management process would be delegated to the Audit Committee. The terms of reference of the Audit committee have been approved by the Board and are reviewed as necessary. The Committee has satisfied its responsibilities for the year, in compliance with its terms of reference. c) Strategy & Investment Committee The Committee consists of 6 members. Its main objective is to discuss strategic matters for SIT Group and oversee strategic investment of the SIT Group. Authority is delegated to the Committee to investigate and take all the necessary actions pertaining to strategy and investment decision making pursuant to strategic objectives of SIT Group. It is then required to submit its recommendations to the main Board of SIT Group, for final approval. The Committee has the following functions: Ensure that the Group has in place a proper strategy management system; Review the effectiveness of SIT Group strategy and make recommendation to the Board; Review strategic plans, corporate objectives and budgets and monitor performance compared to targets; Review and recommend strategic projects to the Board and monitor their implementation; Review management of the Group s capital resources; Seeking expert consultancy services pertaining to investment planning, due diligence, econometric modeling etc. Provide a rapid response forum capable of seizing opportunities as they arise. The Committee Members and attendance for the year under review were as follows: s/n Name Attendance 1 Mr Vishnou Gondeea- Chairperson (Appointed on 06 February 2015) 1/1 2 Mr Gansam Boodram 1/1 3 Mr Yousouf Oodally 1/1 4 Mr Anilkumarr Ramnundun (Appointed on02 June 2015) 1/1 5 Mr Khemlall Rampersad (Appointed on02 June 2015) 1/1 6 Mr Omduthsing Sookaye (Appointed on 06 February 2015) 1/1 7 Mr Shailendrasingh Sreekeessoon (Resigned on 19 December 2014) - 8 Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) - 9 Mr Heeranjay Sobrun (Resigned on 29 December 2014) - 10 Mr Ravin Premsagar Bholah (Resigned on 14 January 2015) - 26

29 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 d) Staff & Remuneration Committee The Staff & Remuneration Committee has been established to provide a mechanism to enhance communication and consultation between staff and management on matters of mutual interest in terms of work matters, issues and concerns. It also promotes the spirit of cooperation between management and staff, considers suggestions for continuous improvements in the Group s operational efficiency, for ensuring staff welfare and recognition of staff concerns and ensures that SIT is an inclusive workplace. The functions of the Staff & Remuneration Committee are essentially to: Advise management on work matters of interest and of concern to staff; Determine, agree and develop the Company s general policy on recruitment, remuneration and conditions of employment; Co-ordinate its activities with the Chairperson of the Board and the Chief Executive Officer and consult them in formulating the committee s remuneration policy and specific remuneration packages; Raise issues, initiate discussions and make suggestions to arrive at options to address the issues/concerns; Share with management staff ideas and suggestions for improvements to increase the Group s operational efficiency and ensure staff welfare; Act as a conduit for 2-way communication between staff and management and provide feedback both ways; Work such matters of interest/concern and issues/concerns for discussions that contribute towards achieving the Group s Mission and Vision: - Personnel issues such as recruitment, staff training and development, performance management, grievance procedures, etc. - Administrative matters such as procurement, travel, transport, telecommunications, security, etc. - Staff relations and communications such as staff and customer satisfaction surveys, enhancing management/staff relationships, staff suggestions, etc. - New initiatives to benefit the SIT Group and the staff. - Strategic issues for the future such as strategic staffing etc. - Matters relating to the well-being of staff physical welfare, working conditions, sports and recreation, etc. - Any other matters affecting the Group s operational efficiency and staff well-being. The Committee Members and attendance for the year under review were as follows: s/n Name Attendance 1 Mr Vishnou Gondeea (Appointed on 06 February 2015) 1/1 2 Mr Gansam Boodram 3/3 3 Mr Krishna Kistnen 3/3 4 Mr Dayanand (Rakesh) Koobrawa (Appointed on 18 June 2015) 1/1 5 Mr Ashis Kumar Hoolass (Resigned on 14 January 2015) 2/2 6 Mr Premsagar Bholah (Resigned on 14 January 2015) 2/2 e) Corporate Social Responsibility Committee The CSR Committee has been set up to consistently maintain the CSR philosophy of the SIT Group and to sustain human and community development around its operational sites and in the country at large. The CSR committee also ensures that the SIT Group, as a socially responsible organisation towards the community and the environment, develops a strategy to use the CSR fund to help develop vulnerable groups in the society and the country at large. Details of the previous projects undertaken are listed in section 27 of this Report. 27

30 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, 2015 No committee was held during the year under review. The Committee consisted of the following Members as at 30 June 2015: 1) Mr Khemlall Rampersad 2) Mr Bal Rajsingh Sharma Bandhu 3) Mr Omduthsing Sookaye f) Risk Committee On 8 July 2015, the Board decided to constitute a separate Risk Committee to set risk strategy, advise the board on risk issues and monitor the risk management process. The objective of the Committee is to assist the Board in the discharge of its duties relating to corporate accountability and the associated risk in terms of management, assurance and reporting. The Committee will review and assess the integrity of the risk control systems and ensure that the risk policies and strategies are effectively managed. The Committee will set out the nature, role, responsibility and authority of the risk management function within the Company and outline the scope of risk management work. The Committee will monitor external developments relating to the practice of corporate accountability and the reporting of specifically associated risk, including emerging and prospective impacts. The Committee provides an independent and objective oversight and review of the information presented by management on corporate accountability and specifically associated risk, also taking account of reports by management and the Audit Committee to the Board on financial, business and strategic risk. The terms of reference of the Risk Committee have been approved by the Board and are as follows: review any legal matters that could have a significant impact on the Company s business; review executive management reports detailing the adequacy and overall effectiveness of the Company s risk management function and its implementation by management, and reports on internal control and anyrecommendations, and confirm that appropriate action has been taken; review the risk philosophy, strategy and policies recommended by the executive management and consider reports by the executive management; ensure compliance with such policies, and with the overall risk profile of the company. Risk in the widest sense includes market risk, credit risk, liquidity risk, operation risk and commercial risk; review the adequacy of insurance coverage; review risk identification and measurement methodologies; monitor procedures to deal with and review the disclosure of information to clients; the Committee will have due regard for the principles of governance and codes of best practice; the Committee will liaise with the board in respect of the preparation of the Committee s report to shareholders as required; and the responsibility for assessing and assuring the quality of the risk management process would be delegated to the Audit Committee. No committee meeting was held since the constitution of the committee was in July ) INTERNAL CONTROL AND RISK ASSESSMENT The Board had delegated to the Audit Committee the responsibility to report on the effectiveness of Internal Control. The Board had also entrusted to the Audit Committee the responsibility to ensure that Management identifies and manages all inherent risks on a regular basis, prior to the establishment of the Risk Committee. For the year under review, the Audit Committee reported to the Board that they were satisfied that Management had an established system in place to identify and mitigate risks associated with the running of the business. 28

31 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) INTERNAL AUDIT The Company outsources the internal audit function to PWC which has a team of qualified professionals with extensive experience in auditing, fraud examination, risk management, information systems security and governance. PWC was appointed as Internal Auditor on 20 January The Board with the assistance of the Audit Committee and the Internal Auditor monitors the effectiveness of internal controls. The Internal Audit team has an independent appraisal function which reviews the adequacy and effectiveness of internal controls and the systems that support them. This includes controls at both the operational and financial levels as well as offering guidance to Management in relation to the evaluation of overall business risks and actions taken to mitigate such risks. The terms of reference of the Internal Auditors include: Gain an understanding of the flow of transactions through the process or system; Evaluate whether controls are designed adequately; Identify and test key controls to assess whether or not they are operating as designed; Where gaps relating to control weaknesses are identified, make recommendations based on the root causes; and Assess compliance with approved policies and procedures of the Company and to relevant laws and regulations. Four interventions were made during the year. The Internal Audit team has the authority to access and examine all information, both paper-based and electronic documents as well as inspect physical assets. No restrictions on access to records, management or employees of the organisation are placed on internal auditors. 14) STATEMENT OF REMUNERATION POLICY The remuneration of non-executive directors, determined by the Board of directorsis based on performance and contribution to the Company whilst having due regard to market conditions and to the interest of the shareholders. 15) CONSTITUTION We stand guided by the Sugar Industry Efficiency Act, as amended, and the Company is governed by the SIT Rules. A copy of the SIT Rules is available upon request, at the registered office of the Company. 16) RELATED PARTY TRANSACTIONS Please refer to Note 35 of the Financial Statements. 17) SHAREHOLDERS AGREEMENT There is no Shareholder s Agreement. However, Section 6 of the SIE Act provides for an Assembly of Delegates, whereby 6 representatives from each factory area are elected by shareholders of SIT. The election of delegates is held every three years. An election of directors is further held whereby 6 delegates are elected from the Assembly of Delegates to hold office as Directors on the Board of SIT for a term of 3 years. The remaining delegates are appointed as directors on the sugar milling companies, thereby representing SIT on the Board of Directors. Election of delegates and directors have both been held in

32 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) MANAGEMENT AGREEMENT The Company has not entered into any management agreement with third parties. However, SIT Corporate and Secretarial Services Ltd ( SCSSL ) entered into a Management Agreement with Eole Plaine des Roches Ltée ( EPRL ) in April As per the terms of the Agreement, SCSSL provides accounting, management, corporate and secretarial services to EPRL. 19) IDENTIFICATION OF KEY RISK MANAGEMENTS FOR THE COMPANY (i) (ii) Please refer to Note 4 of the Financial Statements. Shareholders Data Protection Risk SIT being the largest shareholder based company in Mauritius, has to ensure that the share register is properly maintained and duly updated. SIT Corporate and Secretarial Services Ltd, which acts as Company Secretary of the Company ensures that all share transfers and amendment in shareholders particulars are entered into the share register. The risk of leakage of shareholders personal information definitely invites for a negative external image of the Company. To overcome the risk, SIT Corporate and Secretarial Ltd has worked in close collaboration with the Central Depository & Settlement Co Ltd (CDS), to ensure the highest level of privacy of shareholders personal information. The share transfers and any change in shareholders particulars are stocked in an external IT database, monitored by CDS at its registered office. Moreover, regular interaction is made with the Commissioner of Data Protection Office to ensure that the provisions of the Data Protection Act are thoroughly complied with. Therefore, with the above structure in place, the likelihood of any leakage of shareholders personal information can be said to be negligible. 20) EMPLOYEE SHARE-OPTION PLAN There is no share-option plan in place for the directors and employees of the Company. 21) IMPORTANT EVENTS Reporting Publication of Unaudited Abridged Interim Financial Statements for Quarter ending November 2014 September 30, 2014 Publication of Unaudited Abridged Interim Financial Statements for Half year ending February 2015 December 31, 2014 Publication of Unaudited Abridged Interim Financial Statements for nine months May 2015 ending March 31, 2015 Publication of Abridged Audited Financial Statements for year ending June 30, 2015 September 2015 Meetings of shareholders Annual General Meeting of shareholders 21 January

33 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) DONATIONS a) CHARITABLE Charitable donations made by the Company and its subsidiaries during the year: Rs 000 Rs 000 The Company The Subsidiaries - - b) POLITICAL The Company in line with its policy did not make any political donation during the year under review (2014: Rs nil). 23) CARBON REDUCTION REPORTING SIT actually does not have any policy set towards carbon reduction schemes. Nevertheless, it has adopted and implemented within the Group, the following measures amongst others, with the aim of reducing the use of carbon, and fortunately enough, it also coincides with the concept of MID (Maurice Ile Durable). The Company has preferred to go for the Pyroelectric ( Passive ) Infrared (PIR) sensor which allows sensing movement of a body within a range of 5 to 7 metres within an office space instead of use of the traditional switch system. The impact of the PIR is such that it switches automatically upon movement of any individual. Subsequently, in the absence of staff members, the office lights switches off automatically and thus lowers consumption of electricity. SIT is also via its subsidiary SIT Property Development Ltd (SPDL), planning to set up two solar farms, in its residential morcellement project, Aurea- Living Harmony. With the imminent implementation of these solar farms, SPDL plans to convert heat energy into electrical energy during the day which shall be transferred to the CEB Grid. This will allow transmission of electricity solely from solar energy which in a way will avoid burning of coal for production of electricity. The company has also come up with implementation of the VRF (Variable Refrigerant Flow) Air- Conditioning System in its office. The VRF units work only on predetermined rates which allows for substantial energy savings. This eventually contributes to less use of electricity and carbon emission. With the above main actions undertaken by the company, SIT has shown that despite not yet having any policy regarding carbon reduction, it has in its best endeavours tried to be in line with the international needs towards a green environment and promote use of energy efficient systems within its office. 24) STAKEHOLDERS RELATIONS AND COMMUNICATION The Board aims to properly understand the information needs of all shareholders and places great importance on an open and meaningful dialogue with all those involved with the Company. It ensures that shareholders are kept informed on matters affecting the Company. Open lines of communication are maintained to ensure transparency and optimal disclosure. All Board members are requested to attend Annual General Meeting, to which all shareholders are invited. 31

34 ANNUAL REPORT 2015 CORPORATE GOVERNANCE REPORT YEAR ENDED JUNE 30, ) CODE OF ETHICS The Company is committed to the highest standards of integrity and ethical conduct in dealing with all its shareholders. Staff at all levels drew up the Company s code of ethics, which reflects the Company s diversity and unique culture. Adequate grievances and disciplinary procedures are in place to enable enforcement of the Code of Ethics. 26) SUSTAINABILITY REPORTING The Company has developed and implemented social, safety, health and environmental policies and practices that in all material respects comply with existing legislative and regulatory frameworks. 27) CORPORATE SOCIAL RESPONSIBILITY The Company has not undertaken any CSR activity during the year under review, due to non-availability of fund. During the previous years, a sum of Rs 2.1 M was allocated as follows: Financial contribution of Rs 1 M to NGO Ranger Foundation Trust for the running of a therapy and learning centre for physically disabled but intellectually capable children. The sum of Rs 1.1 M for the sponsorship of beneficiaries of scholarship under the SIT Scholarship Scheme. The scholarship beneficiaries are children of SIT and SITLH shareholders, owning less than 5% shares and whose monthly income is less than Rs15,000. The beneficiaries are full time degree courses students at the University of Mauritius (UOM) and University of Technology (UTM) for academic years starting in 2011 and 2012 respectively. The duration of the sponsorship varies between 3 to 4 years depending upon the full time courses. Approved and authorised by the Board of Directors on 3 Decembre 2015 and signed on its behalf by: Chairperson Director 32

35 STATEMENT OF COMPLIANCE under Section 75(3) of the Financial Reporting Act JUNE 30, 2015 We, the Directors of Sugar Investment Trust (SIT), confirm that to the best of our knowledge, SIT has complied with all of its obligations and requirements under the Code of Corporate Governance except for Sections 2.2.1, 2.2.2, 2.2.3, 2.2.6, 2.3.3, 2.6.2, 2.6.3, 2.7.2, 2.7.4, 2.7.7, 2.7.8, 2.7.9, 2.10, 3.9.1(b), 3.9.2(b) and 3.9.3(b). Reasons for non-compliance are given below: Section 2 Boards and Directors Sub section 2.2.1, & 2.2.3: The Company does not have at least two independent directors and at least two executive directors on the Board, since as per Section 5 (2) of the Sugar Industry Efficiency (SIE) Act (as amended), the Board of Directors shall consist of 9 persons of whom (a) (b) (c) (d) (e) (f) 2 shall be elected by planters who are delegates elected under section 6(2)(a); one shall be elected by planters who are delegates elected under section 6(2)(b); one shall be elected by employees who are delegates elected under section 6(2)(c); one shall be elected by employees who are delegates elected under section 6(2)(d); one shall be elected by employees who are delegates elected under section 6(2)(e); and 3 shall be appointed by the Minister from persons having wide experience in administrative, economic, financial or commercial matters, or in matters relating to the sugar industry. Thus the Board composition is consistent with the provisions of the SIE Act (as amended). Sub section 2.2.6: The Code requires each director to be elected (or re-elected as the case may be) every year at the Meeting of Shareholders and a brief CV of each director standing for the election or re-election should accompany the notice contained in the annual report. Each director should be elected by a separate resolution. The Company has not complied with sub section of the Code, since as per Regulation 3(2) under section 34(1) (a) of SIE Act, it is noted that Director of the Board shall hold office for a term of 3 years or until such time as the next Board is elected. Hence, the election of Board members is consistent with the provisions of the SIE Act (as amended). Sub section 2.3.3, 2.6.2, The Company has not complied with sub section 2.3.3, 2.6.2, of the Code since the Chief Executive Officer (CEO) was suspended from his duties during the year, following which the post for CEO is still vacant. However, the said post was advertised and shortlisted candidates were called for interview. Subsequent to year end, it is expected to appoint a new CEO. Sub section 2.7.2, 2.7.4, 2.7.7, 2.7.8, The Company has not complied with sub section 2.7.2, 2.7.4, 2.7.7, 2.7.8, of the Code since as per Section 5 (2) of the SIE Act (as amended), the Board of Directors shall consist of 9 persons of whom (a) (b) 2 shall be elected by planters who are delegates elected under section 6(2)(a); one shall be elected by planters who are delegates elected under section 6(2)(b); 33

36 ANNUAL REPORT 2015 STATEMENT OF COMPLIANCE under Section 75(3) of the Financial Reporting Act JUNE 30, 2015 (c) (d) (e) (f) one shall be elected by employees who are delegates elected under section 6(2)(c); one shall be elected by employees who are delegates elected under section 6(2)(d); one shall be elected by employees who are delegates elected under section 6(2)(e); and 3 shall be appointed by the Minister from persons having wide experience in administrative, economic, financial or commercial matters, or in matters relating to the sugar industry. Sub section 2.10 The Company s Directors have not complied with Section 2.10 of the Code which requires Board and Directors appraisal. However, the Company is in the process of implementing a framework for monitoring and evaluation of directors performance and appraisal. Section 3 Board Committees Sub section 3.9.2(b) The Chairperson of the Corporate Governance Committee is not a Board member. The latter being someone who had previously served as Board member of SIT and is also well known for her wide experience on corporate governance matters. She was one of the pioneers to instill the corporate governance culture in Mauritius and a member of the Committee of Corporate Governance of Mauritius. Sub section 3.9.3(b) The Company has partly complied with the said sub section 3.9.3(b), except that there is no CEO and independent director as members of the Risk Committee. Chairperson Director Date: 3 December

37 STATEMENT OF DIRECTORS RESPONSIBILITIES - JUNE 30, 2015 Directors acknowledge their responsibilities for: (i) (ii) (iii) adequate accounting records and maintenance of effective internal control systems; the preparation of financial statements which fairly present the state of affairs of the Group and the Company as at the end of the financial year and the results of operations and cash flows for that year and which comply with International Financial Reporting Standards (IFRS) and the requirements of the Mauritius Companies Act; and the selection of appropriate accounting policies supported by reasonable and prudent judgements. The external auditors are responsible for reporting on whether the financial statements are fairly presented. The directors report that: (i) (ii) (iii) (iv) (v) adequate accounting records and an effective system of internal controls and risk management have been maintained; appropriate accounting policies supported by reasonable and prudent judgements and estimates have been used consistently; International Financial Reporting Standards have been adhered to. Any departure in the interest in fair presentation has been disclosed, explained and quantified. Mauritius Companies Act requirements have been fully adhered to; and the Code of Corporate Governance has been adhered to. Reasons have been provided where there has not been compliance. Approved by the Board of Directors on 3 December 2015 and signed on its behalf by: Chairperson Director 35

38 ANNUAL REPORT 2015 SUGAR INVESTMENT TRUST AND ITS SUBSIDIARIES SECRETARY S CERTIFICATE under Section 166(d) of the Mauritius Companies Act 2001 JUNE 30, 2015 We certify that, to the best of our knowledge and belief, the Company has filed with the Registrar of Companies all such returns as are required of the Company under the Companies Act Omduthsing Sookaye, FCCA FOR SIT CORPORATE AND SECRETARIAL SERVICES LTD Secretary Date: 3 December

39 INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF SUGAR INVESTMENT TRUST Report on the Financial Statements We have audited the consolidated and separate financial statements of Sugar Investment Trust (the Company ) and its subsidiaries (together the Group ), which comprise the statements of financial position at 30 June 2015 and the statements of profit or loss and other comprehensive income, changes in equity and cash flows for the year then ended, and the notes to the financial statements which include a summary of significant accounting policies and other explanatory notes, as set out on pages 33 to 92. This report is made solely to the Company s members, as a body, in accordance with Section 205 of the Mauritius Companies Act. Our audit work has been undertaken so that we might state to the Company s members those matters that we are required to state to them in an auditors report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company s members, as a body, for our audit work, for this report, or for the opinions we have formed. Directors Responsibility for the Financial Statements The directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and in compliance with the requirements of the Mauritius Companies Act, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditors Responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant to the Company s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Other Matter The financial statements for the year ended 30 June 2014 were audited by another auditor, who expressed an unmodified opinion on those financial statements in their report dated 26 September Opinion In our opinion, these financial statements give a true and fair view of the consolidated and separate financial position of Sugar Investment Trust at 30 June 2015 and of its consolidated and separate financial performance and consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards and in compliance with the requirements of the Mauritius Companies Act. 37

40 ANNUAL REPORT 2015 INDEPENDENT AUDITORS REPORT TO THE MEMBERS OF SUGAR INVESTMENT TRUST Report on Other Legal and Regulatory Requirements Mauritius Companies Act We have no relationship with or interests in the Company other than in our capacities as auditors and tax advisors. We have obtained all the information and explanations we have required. In our opinion, proper accounting records have been kept by the Company as far as it appears from our examination of those records. Financial Reporting Act The Directors are responsible for preparing the Corporate Governance report. Our responsibility is to report on the extent of compliance with the Code of Corporate Governance (the Code ) as disclosed in the annual report and on whether the disclosure is consistent with the requirements of the Code. In our opinion, the disclosure in the annual report is consistent with the requirements of the Code KPMG Ebène, Mauritius Subhas Purgus Licensed by FRC Date: 3 December

41 CONSOLIDATED AND SEPARATE STATEMENTS OF FINANCIAL POSITION - JUNE 30, 2015 THE COMPANY Note ASSETS Rs 000 Rs 000 Rs 000 Rs 000 Non-current assets Land Property, plant and equipment Investment property Intangible assets Investments in subsidiaries Investment in associated companies Investments in financial assets Development project costs Plant canes 14(a) Deferred expenditure Deferred tax assets Current assets Inventories Consumable biological assets 14(b) Trade and other receivables Loan receivable from related party Assets held-for-sale Income tax recoverable 29(a) Cash and cash equivalents TOTAL ASSETS EQUITY AND LIABILITIES Capital and reserves Stated capital Revaluation and other reserves Retained earnings Equity attributable to owners of the Company Non-controlling interest Total equity Non-current liabilities Borrowings Retirement benefit obligations Current liabilities Trade and other payables Borrowings Income tax payable 29(a) TOTAL LIABILITIES TOTAL EQUITY AND LIABILITIES Approved by Board on 3 December 2015 and signed on its behalf by: Chairperson Director The notes on pages 44 to 92 form part of these consolidated and separate financial statements. 39

42 ANNUAL REPORT 2015 CONSOLIDATED AND SEPARATE STATEMENTS OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME - YEAR ENDED JUNE 30, 2015 THE COMPANY Note Rs 000 Rs 000 Rs 000 Rs 000 Revenue Other income Operating expenses (92 421) (99 220) - - Cost of land sold (11 980) (5 706) - - Movement in consumable biological assets 14(b) (4 990) - - Change in fair value of plant canes 14(a) (4 383) (5 183) - - Depreciation and amortisation charge (22 142) (12 807) (2 827) (2 955) Administrative expenses (93 043) (70 286) ( ) (50 981) 27 ( ) ( ) ( ) (53 936) Operating profit Finance costs 28 ( ) (14 101) (61 965) (18 792) Share of result of associates 11(b) Profit/(loss) before taxation (60 791) Taxation 29(b) (1 056) - - Profit/(loss) for the year (60 791) Other comprehensive income: Items that may be reclassified subsequently to profit or loss: Movement in fair value of investments (79 208) ( ) ( ) Items that will not be reclassified to profit or loss: Remeasurement of post-employment benefit obligations (544) (139) (544) (139) Share of other comprehensive income of associate ( ) ( ) Total comprehensive income/(loss) for the year ( ) (23 339) Profit/(loss) attributable to: Owners of the parent (60 791) Non-controlling interest (59 918) (11 286) (60 791) Total comprehensive income/(loss) attributable to: Owners of the parent ( ) (23 339) Non-controlling interest (61 171) (11 286) ( ) (23 339) Earnings per share (Rs) (0.16) 0.30 The notes on pages 44 to 92 form part of these consolidated and separate financial statements. 40

43 CONSOLIDATED AND SEPARATE STATEMENTS OF CHANGES IN EQUITY - YEAR ENDED JUNE 30, 2015 Attributable to owners of the parent Revaluation Non- Stated and other Actuarial Retained controlling Total Note capital reserves reserves Earnings Total interest equiy Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 At July 1, (28 220) Profit for the year (59 918) Other comprehensive income for the year (1 253) Total comprehensive income for the year (61 171) Reclassification - ( ) Dividends (38 985) (38 985) (32 500) (71 485) At June 30, (28 106) At July 1, as previously reported effect of adopting IAS 19 (Revised) (4 578) (4 578) - as restated Profit for the year (11 286) Other comprehensive income for the year (4 222) Total comprehensive income for the year (4 222) (11 286) Reclassification (23 998) Dividends (46 782) (46 782) (39 003) (85 785) At June 30, (28 220) The notes on pages 44 to 92 form part of these consolidated and separate financial statements. 41

44 ANNUAL REPORT 2015 CONSOLIDATED AND SEPARATE STATEMENTS OF CHANGES IN EQUITY - YEAR ENDED JUNE 30, 2015 THE COMPANY Revaluation Stated and other Actuarial Retained Note capital reserves reserves Earnings Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 At July 1, (139) Loss for the year (60 791) (60 791) Other comprehensive income for the year - ( ) (544) - ( ) Reclassification - ( ) Total comprehensive income for the year - ( ) (544) ( ) Dividends (38 985) (38 985) At June 30, (683) At July 1, Profit for the year Other comprehensive income for the year - ( ) (139) - ( ) Total comprehensive income for the year - ( ) (139) (23 339) Dividends (46 782) (46 782) At June 30, (139) The notes on pages 44 to 92 form part of these consolidated and separate financial statements. 42

45 CONSOLIDATED AND SEPARATE STATEMENTS OF CASH FLOWS - YEAR ENDED JUNE 30, 2015 THE COMPANY Note Rs 000 Rs 000 Rs 000 Rs 000 Cash flows from operating activities Cash generated from operations 32(a) ( ) ( ) Development project costs 13 - ( ) - - Land acquired and related costs for assets held-for-sale 19 ( ) ( ) - - Deposit on sale of land Interest income Tax paid 29(a) - (13 357) - - Interest expense 28 ( ) (14 101) (61 965) (18 792) Net cash used in operating activities ( ) ( ) ( ) ( ) Cash flows from investing activities Purchase of land 6 - (6 135) - Purchase of property, plant and equipment 7 (2 077) (7 057) (570) (2 680) Purchase of intangible assets 9 (33) (388) (33) (351) Disposal of land Disposal of property, plant and equipment Land adjustment Investment in financial assets 12 (14 380) (5 287) (14 380) (5 287) Additions to plant canes 14 (3 921) (2 324) - - Deferred expenditure 15 (22 975) (31 753) - - Additions to investment property 8 - (8 614) - - Dividends received Net cash generated from/(used in) (2 758) (14 973) (8 318) investing activities Cash flows from financing activities Loans received Repayment of borrowings ( ) ( ) (50 000) Dividends paid to company s shareholders (38 985) (46 782) (38 985) (46 782) Dividends paid to minority shareholders (32 503) (39 003) - - Net cash generated from financing activities Decrease in cash and cash equivalents ( ) ( ) ( ) ( ) Movement in cash and cash equivalents At July 1, (96 267) (20 721) Decrease in cash and cash equivalents ( ) ( ) ( ) ( ) At June 30, 32(b) ( ) (96 267) ( ) (20 721) The notes on pages 44 to 92 form part of these consolidated and separate financial statements. 43

46 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June GENERAL INFORMATION Sugar Investment Trust, a public company incorporated and domiciled in Mauritius, has been designated as an Approved Investment Institution under section 50A of the Stock Exchange Act and continues to operate subject to the conditions of the Stock Exchange (Approved Investment Institution) Rules The principal place of business and address of the registered office of Sugar Investment Trust (the Company ) is Ground Floor, NG Tower, Cybercity, Ebène. The consolidated and separate financial statements as at 30 June 2015 comprise the Company and its subsidiaries (together referred as the Group) and the Group s interest in associates. These consolidated and separate financial statements will be submitted for consideration and approval at the forthcoming Annual Meeting of Shareholders of the Company. 2. BASIS OF PREPARATION (a) Statement of compliance These consolidated and separate financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and in compliance with requirements of the Mauritius Companies Act (b) Basis of measurement These consolidated and separate financial statements have been prepared under the historical cost basis except for the following material items in the consolidated and separate statements of financial position: (i) (ii) (iii) (c) Consumable biological assets are stated at fair value less estimated point of sale costs. Employee benefits are stated at fair value of plan assets less the present value of the defined benefit obligation as explained in Note 23. Relevant financial assets and liabilities are stated at fair value. Functional and presentation currency These consolidated and separate financial statements are presented in Mauritian Rupees ( Rs ), which is the Group s and the Company s functional and presentation currency. All values are rounded to the nearest thousand (Rs 000) except when otherwise indicated. (d) Use of estimates and judgements In preparing these consolidated and separate financial statements, management has made judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future period affected. 44

47 Notes to the consolidated and separate financial statements for the year ended 30 June SIGNIFICANT ACCOUNTING POLICIES The accounting policies set out below have been applied consistently to all periods presented in these consolidated and separate financial statements, and have been applied consistently by the Group and the Company. (a) (i) Basis of consolidation Subsidiaries Subsidiaries are all entities controlled by the Group. The Group controls an entity when it is exposed to or has rights to variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date on which control commences until the date from which control ceases. The accounting policies of subsidiaries have been changed where necessary to align them with the policies adopted by the Group. Losses applicable to the non-controlling interests in a subsidiary are allocated to the noncontrolling interests even if doing so causes the non-controlling interests to have a deficit balance. In the Company s financial statements, investments in subsidiaries are measured at cost. The carrying amount is reduced if there is any indication of impairment in value. A listing of the principal subsidiaries is shown in Note 10. (ii) Non-controlling interests (NCI) NCI are measured at their proportionate share of the acquiree s identifiable net assets at the date of acquisition (iii) Loss of control Upon the loss of control, the Group derecognises the assets and liabilities of the subsidiary with any noncontrolling interests and other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in profit or loss. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently it is accounted for as an equity-accounted investee or as a financial asset depending on level of influence retained. (iv) Interests in equity-accounted investees The Group s interests in equity-accounted investees comprise interests in associates. Associates are those entities in which the Group has significant influence, but not control or joint control, over the financial and operating policies. Interests in equity-accounted investees are accounted for using the equity method. They are initially recognised at cost, which includes transaction costs. Subsequent to initial recognition, the consolidated financial statements include the Group s share of profit or loss and other comprehensive income of equity-accounted investees, until the date on which significant influence ceases. (v) Transactions eliminated on consolidation Intra-group balances and any unrealised income and expenses arising from intra-group transactions are eliminated in preparing the consolidated financial statements. Unrealised gains arising from transactions with 45

48 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 equity accounted investees are eliminated against the investments to the extent of the Group s interest in the investee. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment. (b) Foreign currency Transactions in foreign currencies are translated to the respective functional currencies of the Group and the Company at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are translated to the functional currency at the exchange rate at that date. Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated to the functional currency at the exchange rate when the fair value was determined. Non-monetary items that are measured based on historical cost in a foreign currency are not translated. Foreign currency differences are generally recognised in profit or loss. (c) Financial instruments Financial assets and liabilities are recognised on the statement of financial position when the Group and the Company become a party to the contractual provisions of the financial instruments. Except where stated separately, the carrying amounts of the Group s and the Company s financial instruments approximate their fair values. The classification of financial instruments depends on the nature and purpose of the financial instrument and is determined at the time of initial recognition. Non-derivative financial instruments The Group and the Company classify non-derivatives financial assets as loans and receivables and available-forsale financial assets. The Group and the Company classify non-derivatives financial liabilities into the other financial liabilities category. Non-derivative financial assets comprise available-for-sale investments, loan receivable from related party, trade and other receivables and cash and cash equivalents. Non-derivative financial liabilities comprise of borrowings and trade and other payables. Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group and the Company have a legal right to offset the amounts and intend either to settle on a net basis or to realise the asset and settle the liability simultaneously. Non-derivative financial instruments are recognised initially at fair value plus, for instruments not at fair value through profit or loss, any directly attributable transaction costs. Subsequent to initial recognition non-derivative financial instruments are measured as follows: (i) Available-for-sale financial assets The Group s investments in equity securities are classified as available-for-sale financial assets. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment, and foreign exchange gains and losses on available-for-sale monetary items are recognised directly in other comprehensive income and accumulated in the fair value reserve. When an investment is derecognised, the cumulative gain or loss in equity is transferred to profit or loss. 46

49 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 Available-for-sale investments which do not have a quoted market price and whose fair value cannot be reliably measured, are carried at cost, less any impairment. (ii) Loans and receivables Loans and receivables are measured at amortised cost using the effective interest method, less any impairment losses. The amortised cost of loans and receivables is the amount at which the financial asset is measured at initial recognition, minus principal repayments, plus or minus the cumulative amortisation using the effective interest method of any difference between the initial amount recognised and the maturity amount, minus any reduction in impairment. (iii) Cash and cash equivalents Cash and cash equivalents comprise cash balances. Bank overdrafts that are repayable on demand and form an integral part of the Group s and the Company s cash management are included as a component of cash and cash equivalents for the purpose of the statement of cash flows. Cash and cash equivalents are measured at amortised cost which is equivalent to their fair value. (iv) Derecognition of financial assets The Group and the Company derecognise a financial asset only when the contractual rights to the cash flows from the asset expire or they transfer the financial assets and substantially all the risks and rewards of ownership of the asset to another entity. If the Group and the Company neither transfer nor retain substantially all the risks and rewards of ownership and continue to control the transferred asset, the Group and the Company recognise their retained interest in the asset and an associated liability for amounts they may have to pay. If the Group and the Company retain substantially all the risks and rewards of ownership of a transferred financial asset, the Group and the Company continue to recognise the financial asset and also recognise a collateralised borrowing for the proceeds received. (v) Other financial liabilities Other financial liabilities comprise borrowings, bank overdrafts and trade and other payables and are recognised initially on the trade date, which is the date that the Group and the Company become a party to the contractual provisions of the instrument. Other financial liabilities are initially measured at fair value less, for instruments not at fair value through profit or loss, any directly attributable transaction costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. (vi) Derecognition of financial liabilities The Group and the Company derecognise financial liabilities when, and only when, the Group s and the Company s obligations are discharged, cancelled, or expired. (vii) Ordinary shares Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of ordinary shares are recognised as a deduction from equity. 47

50 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (d) (e) (i) Land Land is stated at cost and is not depreciated. Property, plant and equipment Recognition and measurement Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses. Cost includes expenditures that are directly attributable to the acquisition of the asset. The cost of self-constructed assets includes the cost of materials and direct labour, any other costs directly attributable to bringing the asset to a working condition for its intended use, and the cost of dismantling and removing the items and restoring the site on which they are located. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. The carrying values of property, plant and equipment are reviewed for impairment at each reporting date or when events or changes in circumstances indicate that the carrying value may not be recoverable. Gains and losses on disposal of an item of property, plant and equipment are determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment, and are recognised net within other income in profit and loss. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. (ii) Subsequent costs The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Group and the Company and the cost can be measured reliably. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. (iii) Depreciation Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. The depreciation rates for the current and comparative periods are as follows: Buildings and leisure park on leasehold land - 2% - 4% p.a Freehold building - 2% p.a Infrastructure and landscaping - 10% p.a Waterpark equipment - 10% - 20% p.a Amusement rides - 10% p.a Furniture, fittings and partitionings - 10% -33 1/3% p.a Office equipment - 20% p.a Computer equipment - 20% -33 1/3% p.a Motor vehicles - 20% p.a Electrical equipment - 10% p.a Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. 48

51 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (f) Intangible assets Computer software Acquired 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 (3-5 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 the Company and that will generate economic benefits exceeding costs beyond one year, are recognised as intangible assets. (g) Biological assets Biological assets are measured at fair value less costs to sell, with any change therein recognised in profit or loss. (i) Plant canes Plant canes comprise of related costs incurred for the plantation of cane sets. The costs are amortised over seven years. (ii) Consumable biological assets Standing canes and nursery plants are measured at their fair value. The fair value of standing canes is the present value of expected net cash flows from the standing canes discounted at the relevant market determined pre-tax rate. The fair value of nursery products is the present value of expected net cash flows discounted at the relevant market-determined pre-tax rate. (h) Investment property Investment property held to earn rentals/or for capital appreciation or both and not occupied by the Group and the Company is carried at cost less accumulated depreciation and any accumulated impairment losses. Depreciation rate of 2% is calculated to write off the cost of the investment property to its residual value over its estimated useful life. (i) Operating leases The Group and the Company as lessee Operating lease payments are recognised as an expense on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased assets are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred. The Group as lessor Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs are incurred in negotiating and arranging an operating lease are added in the carrying amount of the leased asset and recognised on a straight-line basis over the lease term. 49

52 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (j) Trade and other receivables Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group and the Company will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset s carrying amount and the present value of estimated, future cash flows discounted at the effective interest rate. The amount of provision is recognised in the profit and loss. (k) Trade and other payables Trade and other payables are stated at their nominal value. (l) Inventories Inventories are stated at the lower of cost and net realisable value. Cost is determined by the weighted average method. Net realisable value is the estimate of selling price in the ordinary course of business less selling expenses. (m) Borrowings Borrowings are initially recognised at fair value being their issue proceeds net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the profit or loss over the period of the borrowings using the effective interest method. Borrowings are classified as current liabilities unless the Group and the Company have an unconditional right to defer settlement of the liability for at least twelve months after the end of the reporting period. (n) Taxation Taxation comprises of current and deferred tax. Income tax expense is recognised in profit or loss except to the extent that it relates to items recognised directly in equity or other comprehensive income, in which case it is recognised in equity or other comprehensive income. Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted at the reporting date. Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for the following temporary differences: the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit; temporary differences relating to investments in subsidiaries, associates and jointly controlled entities to the extent that they probably will not reverse in the foreseeable future; arising on the initial recognition of goodwill. Deferred tax is measured at the tax rates that are expected to be applied to the temporary differences when they reverse, based on the laws that have been enacted or substantively enacted by the reporting date. 50

53 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 A deferred tax asset is recognised for unused tax losses, tax credits, and deductible temporary differences to the extent that it is probable that future taxable profits will be available against which they can be used. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be recognised simultaneously. (o) Assets held-for-sale 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 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. (p) Borrowings costs Borrowing 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. Other borrowing costs are expensed. (q) (i) Retirement benefit obligations Defined contribution plan A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. Payments to defined contribution plans are recognised as an expense when employees have rendered service that entitle them to the contributions. (ii) Defined benefit plan A 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. 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 method. Remeasurement of the net defined benefit liability, which comprise 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. 51

54 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 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 current service cost, past service cost, as well as gains and losses on curtailments and settlements are recognised immediately in profit or loss. State plan and defined contribution pension plan. Contributions to the National Pension Scheme and defined contribution pension plan are expensed to the statement of profit or loss and other comprehensive income in the period in which they fall due. Gratuity on retirement In respect of employees who are not covered by the above pension plan, the net present value of 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. (r) Provisions Provisions are recognised when the Group/Company have a present legal or constructive obligation as a result of past events which 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. (s) (i) Impairment Non derivative financial assets Financial assets not classified as at fair value through profit or loss, including an interest in an equity accounted investee, are assessed at each reporting date to determine whether there is objective evidence of impairment. Objective evidence that financial assets are impaired includes: default or delinquency by a debtor; restructuring of an amount due to the Group and the Company on terms that the Group and the Company would not consider otherwise; indications that a debtor or issuer will enter bankruptcy; adverse changes in the payment status of borrowers or issuers; the disappearance of an active market for a security; or observable data indicating that there is a measurable decrease in the expected cash flows from a group of financial assets. (ii) Non-financial assets 52 At each reporting date, the Group and the Company review the carrying amounts of the non-financial assets to determine whether there is any indication of impairment. If any such indication exists, then the asset s recoverable amount is estimated.

55 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 An impairment loss is recognised if the carrying amount of an asset exceeds its recoverable amount. An impairment loss in respect of goodwill is not reversed. For other assets, an impairment loss is reversed only to the extent that the asset s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. (t) Revenue recognition Revenue represents: Dividend income; Gross proceeds from sugar, molasses and other products; Proceeds from sale of land; Income from entrance fees, restaurant and retail sales. Revenue is measured at the fair value of the consideration received or receivable, and represents amounts receivable for goods supplied, stated net of discounts, returns, value added taxes, rebates and other similar allowances and after eliminating sales within the Group. Dividend income - when the shareholder s right to receive payment is established. Proceeds from sugar, molasses and other products are recognised based upon share of total production of the crop year. The sugar price is based on the recommendation of the Mauritius Chamber of Agriculture after consultation with the Mauritius Sugar Syndicate. The difference between the recommended price and the final price is reflected in the financial year it is established. Revenue from the disposal of properties is recognised on legal completion of the contract and when the entity has completed its contractual performance. Such revenue is recognised when legal title passes to the buyer. For contracts entered into before the end of the reporting date and conditions are fulfilled at the end of the reporting period, revenue is accounted at the end of the reporting period even if it is earned in the following year, in accordance with the amount stipulated in the signed contract. Other revenues earned by the Group and the Company are recognised on the following bases: Interest income - on a time proportion basis using the effective interest method. Rental and other income - as it accrues unless collectability is in doubt. (u) Dividend distribution Dividend distribution to the Group s and Company s shareholders is recognised as a liability in the Group s financial statements in the period in which the dividends are declared. (v) Development project costs The infrastructure and development costs incurred in the land development projects are capitalised and subsequently released to the statement of profit or loss and other comprehensive income as and when sales are being effected. (w) Deferred expenditure Deferred expenditure consists of professional fees, construction cost of show residence incurred on land development which are released to the statement of profit or loss and other comprehensible income in the year in which the land and residential complex will be sold. 53

56 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (x) New or revised accounting standards and interpretations have been issued but not yet effective for the year ended 30 June 2015 Up to the date of issue of these financial statements, the IASB has issued a number of amendments, new standards and interpretations which are not yet effective for the year ended 30 June 2015 and which have not been adopted in these financial statements. The Group and the Company are in the process of making an assessment of what the impact of these amendments, new standards and new interpretations is expected to be in the period of initial application. All Standards and Interpretations will be adopted at their effective date (except for those Standards and Interpretations that are not applicable to the entity). The standards that need to be considered for financial years ending on or after 01 July 2015 are listed below. Standard/Interpretation Date issued by IASB Effective date Periods beginning on or after IAS 16 and IAS 38 Clarification of Acceptable Methods of May July 2016 Depreciation and Amortisation IFRS 15 Revenue from contracts with customers May July 2018 IFRS 9 Financial Instruments July July 2018 IAS 27 Equity Method in Separate Financial Statements August July 2016 IFRS 10, IFRS 12 and IAS 28 Investment Entities: Applying the Consolidation Exception December 2014 IAS 1 Disclosure Initiative December July July 2016 Clarification of Acceptable Methods of Depreciation and Amortisation (Amendments to IAS 16 and IAS 38) The amendments to IAS 16 Property, Plant and Equipment explicitly state that revenue-based methods of depreciation cannot be used for property, plant and equipment. The amendments to IAS 38 Intangible Assets introduce a rebuttable presumption that the use of revenuebased amortisation methods for intangible assets is inappropriate. The presumption can be overcome only when revenue and the consumption of the economic benefits of the intangible asset are highly correlated, or when the intangible asset is expressed as a measure of revenue. The amendments apply prospectively for annual periods beginning on or after 1 July 2016 and early adoption is permitted. The above standard is not going to have an impact on these consolidated and separate financial statements. IFRS 15 Revenue from contracts with customers This standard replaces IAS 11 Construction Contracts, IAS 18 Revenue, IFRIC 13 Customer Loyalty Programmes, IFRIC 15 Agreements for the Construction of Real Estate, IFRIC 18 Transfer of Assets from Customers and SIC- 31 Revenue Barter of Transactions Involving Advertising Services. 54

57 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 The standard contains a single model that applies to contracts with customers and two approaches to recognising revenue: at a point in time or over time. The model features a contract-based five-step analysis of transactions to determine whether, how much and when revenue is recognised. This new standard will most likely have a significant impact on the Group and the Company, which will include a possible change in the timing of when revenue is recognised and the amount of revenue recognised. The Group and the Company are currently in the process of performing a more detailed assessment of the impact of this standard on the Group and the Company and will provide more information in the year ending 30 June 2016 consolidated and separate financial statements. The standard is effective for annual periods beginning on or after 1 July 2018, with early adoption permitted under IFRS. IFRS 9Financial Instruments On 24 July 2014 the IASB issued the final IFRS 9 Financial Instruments Standard, which replaces earlier versions of IFRS 9 and completes the IASB s project to replace IAS 39 Financial Instruments: Recognition and Measurement. This standard will have a significant impact on the Group and the Company, which will include changes in the measurement bases of the Group s and the Company s financial assets to amortised cost, fair value through other comprehensive income or fair value through profit or loss. Even though these measurement categories are similar to IAS 39, the criteria for classification into these categories are significantly different. In addition, the IFRS 9 impairment model has been changed from an incurred loss model from IAS 39 to an expected credit loss model, which is expected to increase the provision for bad debts recognised by the Group and the Company. The standard is effective for annual periods beginning on or after 1 July 2018 with retrospective application, early adoption is permitted. Equity Method in Separate Financial Statements (Amendments to IAS 27) The amendments allow an entity to apply the equity method in its separate financial statements to account for its investments in subsidiaries, associates and joint ventures. The amendments apply retrospectively for annual periods beginning on or after 1 January 2016 and early adoption is permitted. The Group and the Company are currently in the process of assessing the impact of the amendments on these consolidated and separate financial statements. Investment Entities: Applying the Consolidation Exception (Amendments to IFRS 10, IFRS 12 and IAS 28) The amendment to IFRS 10 Consolidated Financial Statements clarifies which subsidiaries of an investment entity are consolidated instead of being measured at fair value through profit and loss. The amendment also modifies the condition in the general consolidation exemption that requires an entity s parent or ultimate parent to prepare consolidated financial statements. The amendment clarifies that this condition is also met where the ultimate parent or any intermediary parent of a parent entity measures subsidiaries at fair value through profit or loss in accordance with IFRS 10 and not only where the ultimate parent or intermediate parent consolidates its subsidiaries. 55

58 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 The amendment to IFRS 12 Disclosure of Interests in Other Entities requires an entity that prepares financial statements in which all its subsidiaries are measured at fair value through profit or loss in accordance with IFRS 10 to make disclosures required by IFRS 12 relating to investment entities. The amendment to IAS 28 Investments in Associates and Joint Ventures modifies the conditions where an entity need not apply the equity method to its investments in associates or joint ventures to align these to the amended IFRS 10 conditions for not presenting consolidated financial statements. The amendments introduce relief when applying the equity method which permits a non-investment entity investor in an associate or joint venture that is an investment entity to retain the fair value through profit or loss measurement applied by the associate or joint venture to its subsidiaries. The amendments apply retrospectively for annual periods beginning on or after 1 January 2016, with early application permitted. The above standard is not going to have an impact on these consolidated and separate financial statements. Disclosure Initiative (Amendments to IAS 1) The amendments provide additional guidance on the application of materiality and aggregation when preparing financial statements. The amendments also clarify presentation principles applicable to of the order of notes, OCI of equity accounted investees and subtotals presented in the statement of financial position and statement of profit or loss and other comprehensive income. The amendments apply for annual periods beginning on or after 1 January 2016 and early application is permitted. The Group and the Company are currently in the process of assessing the impact of the amendments on these consolidated and separate financial statements. 4. FINANCIAL RISK MANAGEMENT 4.1 Financial risk factors The Group and the Company have exposure to the following risks from their use of financial instruments: Market risk (including cash flow and fair value interest rate risk); Credit risk; and Liquidity risk The Group s and the Company s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group s and the Company s financial performance. (a) Market risk Cash flow and fair value interest rate risk The Group and the Company are exposed to interest rate risk as they borrow at variable rates. In respect of the latter, they are exposed to risk associated with the effect of fluctuations in the prevailing level of market interest rates on its financial position and cash flows. 56

59 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 Interest rate sensitivity analysis At June 30, 2015, if interest rates on borrowings had been 50 basis points higher/lower with all other variables held constant post-tax profit for the year would have been lower/higher as shown below, mainly as a result of higher/lower interest expense on floating rate borrowings. The Group and the Company monitor the risk by maintaining an appropriate mix of fixed and floating interest charges on borrowings. THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Effect higher/lower on post tax profit All borrowings are denominated in Mauritian Rupees. (b) Credit risk Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Group s trade receivables. The amounts presented in the statement of financial position are net of allowances for doubtful receivables, estimated by the Group s management based on prior experience. The Group and the Company have no significant concentration of credit risk, with exposure spread over a large number of counterparties and customers. The Group and the Company have policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. Cash and cash equivalents The Group held cash and cash equivalents of Rs 67.3m at 30 June 2015 (2014:Rs 30.2m). The cash and cash equivalents are held with bank and financial institution counterparties. Available-for-sale financial asstes The Group limits its exposure to credit risk by investing in available-for-sale financial assets. As at 30 June 2015, the Group managed a portfolio of Rs 3.6 billion (2014:Rs 3.5 billion). An impairment loss of Rs28m in respect of available-for-sale financial assets was recognised in (c) Liquidity risk Liquidity 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, the availability of funding from an adequate amount of committed credit facilities and the ability to close out market positions. 57

60 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 Management monitors rolling forecasts of the Group s and the Company s liquidity reserve on the basis of expected cash flow. The table below analyses the Group s and the Company s financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date. Less than Between 1 Between 2 Over 5 1 year and 2 years and 5 years years Rs 000 Rs 000 Rs 000 Rs 000 At June 30, 2015 Trade and other payables Borrowings At June 30, 2014 Trade and other payables Borrowings THE COMPANY At June 30, 2015 Trade and other payables Borrowings At June 30, 2014 Trade and other payables Borrowings Fair value Fair value hierarchy The Group and the Company use the following hierarchy for determining and disclosing the fair value of financial instruments by valuation technique: Level 1 - quoted prices (unadjusted) in active markets for identical assets or liabilities; Level 2 - other techniques for which all inputs which have a significant effect on the recorded fair value are observable, either directly or indirectly; Level 3 - techniques which use inputs which have a significant effect on the recorded fair value that are not based on observable market data. The following table summarizes the levels within the fair value hierarchy in which the fair value measurements of the Group s and Company s financial assets and liabilities fall. 58

61 Notes to the consolidated and separate financial statements for the year ended 30 June June 2015 Loans and receivables Availablefor-sale Other financial liabilities Total Level 1 Level 2 Level 3 Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Financial assets Trade and other receivables Cash and cash equivalents Investments in financial assets Financial liabilities Borrowings Trade and other payables Loans and receivables Availablefor-sale Other financial liabilities Total Level 1 Level 2 Level 3 Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs June 2014 Financial assets Trade and other receivables Cash and cash equivalents Investments in financial assets Financial liabilities Borrowings Trade and other payables

62 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 THE COMPANY Loans and receivables Availablefor-sale Other financial liabilities Total Level 1 Level 2 Level 3 Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs June 2015 Financial assets Trade and other receivables Cash and cash equivalents Investments in financial assets Financial liabilities Borrowings Trade and other payables Loans and receivables Availablefor-sale Other financial liabilities Total Level 1 Level 2 Level 3 Total 30 June 2014 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Financial assets Trade and other receivables Cash and cash equivalents Investments in financial assets Financial liabilities Borrowings Trade and other payables Biological assets The Group is exposed to fluctuations in the price of sugar and the incidence of exchange rate. This risk affects both the crop proceeds and the fair value of biological assets. The risk is not hedged. 60

63 Notes to the consolidated and separate financial statements for the year ended 30 June Capital risk management The Group s and the Company s objectives when managing capital are: to safeguard the entity s ability to continue as a going concern, so that it can continue to provide returns for shareholders and benefits for other stakeholders; and to provide an adequate return to shareholders by pricing products and services commensurately with the level of risk. The Group and the Company set the amount of capital in proportion to risk. The Group and the Company manage the capital structure and make 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 on capital to shareholders, issue new shares, or sell assets to reduce debt. Consistently with others in the industry, the Group and the Company monitor capital on the basis of the debt-tocapital ratio. This ratio is calculated as net debt to capital. Net debt is calculated as total debts less cash and cash equivalents. Capital comprises all components of equity (that is share capital, retained earnings and revaluation reserves). The Group s and the Company s overall strategy remain unchanged from The debt-to-adjusted capital ratio as at June 30, 2015 and at June 30, 2014 were as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Total debt Less: cash and cash equivalents (67 306) (30 228) (45 081) (12 418) Net debt Total equity Debt-to-adjusted capital ratio 39% 27% 41% 17% 5. 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. 5.1 Critical accounting estimates and assumptions The Group and the Company make 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. (a) Impairment of available-for-sale financial assets The Group and the Company follow the guidance of IAS 39 on determining when an investment is other-thantemporarily impaired. This determination requires significant judgement. In making this judgement, the Group and the Company 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. 61

64 ANNUAL REPORT 2015 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (b) (i) Biological assets Plant canes Plant canes have been estimated based on the cost of land preparation and planting of bearer canes. (ii) Consumable biological assets - Standing canes The fair value of consumable biological assets has been arrived at by discounting the present value (PV) 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. The harvesting costs and other direct expenses are based on the yearly budgets of the Group. (c) Pension benefits The present value of the pension obligations depend 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 and the Company determine 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 and the Company consider 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 liability. Other key assumptions for pension obligations are based on current market conditions. (d) Fair value of securities not quoted in an active market The fair value of securities not quoted in an active market may be determined by the Group/Company using valuation techniques including third party transaction values, earnings, net asset value or discounted cash flows, whichever is considered to be appropriate. The Group/Company 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. (e) Limitation of sensitivity analysis Sensitivity 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. 62

65 Notes to the consolidated and separate financial statements for the year ended 30 June 2015 (f) Asset lives and residual values Property, 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. (g) Depreciation policies Property, 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/Company would currently obtain from disposal of the asset, if the asset was already of the age and in condition expected at the end of its useful life. The directors therefore make estimates based on historical experience and use 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. 6. LAND Rs 000 Rs 000 At July 1, Additions Disposals (7 731) - Transfer to assets held-for-sale (Note 19) (102) - Adjustment (Note (iii)) (15 142) - At June 30, (i) (ii) (iii) Land is stated at cost. Bank borrowings are secured by floating charges on the Group s assets including land. The adjustment refers to correction of a difference in land as per Land Business Unit data and actual arpents of land accounted in the books. This difference is explained by discrepancies noted in the financial years 2003 to 2008, where the overall impact is 126 arpents. 63

66 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, PROPERTY, PLANT AND EQUIPMENT Buildings and leisure park leasehold land Freehold Building Infrastructure and landscaping Waterpark equipment Amusement rides Furniture, fittings and partitioning Office equipment Computer equipment Motor vehicles Electrical equipment Total 2015 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 COST At July 1, Additions Disposal (36) - - (36) At June 30, DEPRECIATION At July 1, Charge for the year Disposal (8) - - (8) At June 30, NET BOOK VALUE At June 30,

67 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, PROPERTY, PLANT AND EQUIPMENT (cont d) Buildings and leisure park leasehold land Freehold Building Infrastructure and landscaping Waterpark equipment Amusement rides Furniture, fittings and partitioning Office equipment Computer equipment Motor vehicles Electrical equipment Total 2014 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 COST At July 1, Additions Disposal/Scrap (939) (1 550) - (2 489) At June 30, DEPRECIATION At July 1, Charge for the year Disposal/Scrap (939) (1 550) - (2 489) Adjustment At June 30, NET BOOK VALUE At June 30,

68 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (i) (ii) The Group holds land under industrial lease for a remaining period of 6 years, expiring in 2020 and renewable for four further periods of 10 years. The land has been valued at Rs. 675 million by Alan Tinkler Ramlackhan & Co, Chartered Valuation Surveyors on December 8, Borrowings are secured by fixed and floating charges on the assets of the Group. THE COMPANY Furniture, fittings and Office Computer Motor partitionings equipment equipment vehicles Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 COST At July 1, Additions Disposal - - (36) - (36) At June 30, DEPRECIATION At July 1, Charge for the year Disposal - - (8) - (8) At June 30, NET BOOK VALUE At June 30, COST At July 1, Additions Disposal (1 550) (1 550) At June 30, DEPRECIATION At July 1, Charge for the year Disposal (1 550) (1 550) At June 30, NET BOOK VALUE At June 30, The borrowings are secured by floating charges on the assets of the Company. 66

69 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, INVESTMENT PROPERTY COST Rs 000 Rs 000 At July 1, Additions Transfer from Development Project Costs (Note 13) At June 30, DEPRECIATION At July 1, Charge for the year At June 30, NET BOOK VALUE At June 30, The following amounts have been recognised in the statement of profit or loss and other comprehensive income: COST Rs 000 Rs 000 Rental income Direct operating expenses The directors estimate the net book value as at June 30, 2015 to be the fair value of the investment property. 9. INTANGIBLE ASSETS THE COMPANY Computer software Rs 000 Rs 000 Rs 000 Rs 000 COST At July 1, Additions during the year At June 30, AMORTISATION At July 1, Charge for the year At June 30, NET BOOK VALUE At June 30, INVESTMENTS IN SUBSIDIARIES THE COMPANY Rs 000 Rs 000 At July 1 and June 30,

70 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, INVESTMENTS IN SUBSIDIARIES (cont d) (a) The subsidiaries are listed below : Name of company Main business Year ended Class of Shares held SIT Leisure Limited Constructing, operating or managing leisure parks or other recreational activities Country of incorporation and operation Stated capital Direct % holding Proportion of ownership interests held by non-controlling interests Rs % June 30 Ordinary Mauritius SIT Property Development Ltd Land promoters and land developers June 30 Ordinary Mauritius SIT Land Holdings Ltd (note (d)) Agricultural, property and investment June 30 Founder Share Mauritius SIT Corporate and Secretarial Services Ltd SIT Property Development Consultancy Ltd Provision of corporate services to SIT Group June 30 Ordinary Mauritius Architectural, engineering and technical consultancy June 30 Ordinary Mauritius Executive Café Ltd General Retailer June 30 Ordinary Mauritius June 30 Ordinary Mauritius SIT Ebène Property Development Ltd Business, Professional and Management Consultancy Service SIT Syndicate Services Ltd Landscape Care and Maintenance Service Activities June 30 Ordinary Mauritius SIT Landscape Contracting Landscaping Services June 30 Ordinary Mauritius Services Ltd Le Waterpark Leisure Ltd Activities of amusement park June 30 Ordinary Mauritius NG Tower IV Ltd Rental of office space June 30 Ordinary Mauritius NG Tower V Ltd Rental of office space June 30 Ordinary Mauritius NG Tower II Ltd Rental of office space June 30 Ordinary Mauritius NG Tower III Ltd Rental of office space June 30 Ordinary Mauritius

71 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, INVESTMENTS IN SUBSIDIARIES (cont d) Profit/(loss) allocated to non-controlling interests Accumulated non-controlling interests at June 30, 2015 (b) Subsidiaries with material non-controlling interests Rs 000 Rs 000 Name 2015 SIT Land Holdings Ltd (14 592) SIT Property Development Ltd (45 326) SIT Land Holdings Ltd (15 667) SIT Property Development Ltd (c) (i) Summarised financial information on subsidiaries with material non-controlling interests. Summarised statement of financial position and statement of profit or loss and other comprehensive income: SIT Land Holdings Ltd SIT Property Development Ltd SIT Land Holdings Ltd SIT Property Development Ltd Rs 000 Rs 000 Rs 000 Rs 000 Current assets Non-current assets Current liabilities Non-current liabilities Revenue (Loss)/profit for the year (60 107) (92 502) (11 287) Other comprehensive loss (1 065) Total comprehensive (loss)/ income (61 172) (92 502) (11 287) Dividend paid to non-controlling interests (ii) Summarised cash flow information: SIT Land Holdings Ltd SIT Property Development Ltd SIT Land Holdings Ltd SIT Property Development Ltd Rs 000 Rs 000 Rs 000 Rs 000 Operating activities ( ) (45 549) ( ) Investing activities (5 116) - (6 023) ( ) Financing activities (60 292) (72 791) Net increase/(decrease) in cash and cash equivalents ( ) ( ) 69

72 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 The summarised financial information above is the amount before intra-group eliminations. (d) The Company owns one founder share in SIT Land Holdings Ltd which ranks equally with twenty five thousand ordinary shares as regards rights to dividends and other distribution and return of capital upon winding up. The Company has the power to appoint and remove a majority of directors of SIT Land Holdings Ltd. The relevant activities are determined by the board of directors of SIT Land Holdings Ltd. Therefore, the directors of the Company concluded that it has de facto control over SIT Land Holdings even though it has less than 50% of the ownership interest and is consolidated in these financial statements. 11. INVESTMENT IN ASSOCIATED COMPANIES (a) THE COMPANY Rs 000 Rs 000 At July 1, Change in fair value ( ) (59 589) At June 30, (b) Group s share of net assets Rs 000 Rs 000 At July 1, Share of profits Share of reserves Dividend (58 800) (58 800) At June 30, (c) Details of the associated companies are as follows: Proportion of ownership Nature of Country of interest Year end business incorporation 2015 & 2014 Omnicane Holdings Limited December 31, Investment Mauritius 35% holding Mauritius Land-Based Oceanic Park Ltd December 31, Oceanic Park Mauritius 38.5% (i) Mauritius Land Based Oceanic Park Ltd has not yet started operations and its main activity will be the development and operation of the land based oceanic industry in Mauritius. Omnicane Holdings Limited, an investment company, is the holding company of Omnicane Limited. The fair value of Omnicane Holdings Limited has been determined by reference to the market price of Omnicane Limited, which is listed on the Stock Exchange of Mauritius. 70

73 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (ii) (iii) (d) The financial year end date of Omnicane Holdings Limited is 31 December. For the purposes of applying the equity method of accounting, the financial statements of Omnicane Holdings Limited for the year ended December 31, 2014 have been used and appropriate adjustments have been made for the effects of significant transactions between that date and June 30, Both associates are private companies and there are no quoted market prices available. Summarised financial information Summarised financial information in respect of each of the material associates is set out below Omnicane Holdings Limited Rs 000 Rs 000 Current assets Non-current assets Current liabilities Non-current liabilities Revenue Profit for the year Other comprehensive income ( ) Total comprehensive income Dividend received The summarised financial information above represents amounts shown in the associates financial statements prepared in accordance with IFRS, adjusted for equity accounting purposes such as fair value adjustments made at the time of acquisition and adjustments for differences in accounting policies. (e) Reconciliation of summarised financial information Reconciliation of the above summarised financial information to the carrying amount recognised in the financial statements: Omnicane Holdings Limited Rs 000 Rs 000 Operating net assets Profit for the year Other comprehensive income ( ) Dividends ( ) ( ) Closing net assets Ownership interest % 35% 35% Interest in associates The above information is based on the Associates audited financial statements as at December 31, 2014 and published abridged accounts for the 6 months to June 30, 2015 of Omnicane Limited. (f) The carrying amount of the investment in Mauritius Land Based Oceanic Park Ltd is nil (2014: Rs 5m). 71

74 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, INVESTMENT IN FINANCIAL ASSETS THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Available-for-sale securities - unquoted At July 1, Additions Impairment losses (28 016) - (28 016) - Change in fair value of securities (79 208) (79 208) At June 30, (a) The companies in which Sugar Investment Trust holds at least 5% interest are set out below:- Class of % Holding Unquoted investments shares held Ominicane Milling Holdings Ordinary Deep River Beau Champ Milling Company Ltd Ordinary Alteo Milling Company Ltd Ordinary The Medine Sugar Milling Company Ltd Ordinary Mon Desert Alma Sugar Milling Company Ltd Ordinary Mon Tresor Milling Company Ltd Ordinary Consolidated Energy Ltd Ordinary Terragen Ltd Ordinary Alteo Energy Ltd Ordinary Mauritius Post and Cooperative Bank Ltd Ordinary Sugarworld Limited Ordinary 5 5 Omnicane Thermal Energy Operations (La Baraque) Ordinary Limited Omnicane Thermal Energy Operations (St Aubin) Limited Ordinary The directors do not consider the investee companies with a 20% shareholding to be associated companies as the Group/Company does not exercise significant influence over them. (b) The fair values of the unquoted available-for-sale securities have been based on a weighted average basis of the capitalised earnings method and net assets basis. 72

75 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, DEVELOPMENT PROJECT COSTS COST Rs 000 Rs 000 At July 1, Additions Transfer to Investment Property (Note 8) ( ) - Transfer of Assets held-for-sale (Note 19) ( ) - At June 30, Development project costs relates to infrastructure and other related costs incurred in the construction of the Business and Knowledge Center in Ebène. 14. BIOLOGICAL ASSETS (a) Plant canes Rs 000 Rs 000 Plant canes - at fair value At July 1, Additions Amortisation (4 383) (5 183) At June 30, Plant canes represent cane replantation expenditure that have an expected average life cycle of seven years. (b) Consumable biological assets Rs 000 Rs 000 At July 1, Change in fair value (4 990) At June 30, Analysed between: Standing canes Nursery products Expected price of sugar per ton (Rs) Expected average extraction rate (%) 10.3% 10.2%-10.8% Area harvested (Arpent)

76 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 The fair value of standing canes 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 and the sugar extraction rate and the forecasts of sugar prices which will prevail in the coming year. The harvesting costs and other direct expenses are based on the 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. The fair value of nursery products 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 with reference to the market selling prices of the nursery products net of estimated selling expenses. 15. DEFERRED EXPENDITURE Development Costs COST Rs 000 Rs 000 At July 1, Additions At June 30, Professional fees incurred for residential complex development has been classified as deferred expenditure and will be released as and when sales will take place. 16. DEFERRED TAX ASSETS Deferred tax is provided in respect of all timing differences at the rate of 15% (2014: 15%). The movement in deferred tax account is as follows: Rs 000 Rs 000 At July 1, - as previously reported effect of adopting IAS 19 (Revised) as restated Credited/(charged) to profit or loss (604) At June 30,

77 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 Deferred income tax assets and liabilities in the statement of financial position and deferred income tax charge / (credit) in the statement of profit or loss and other comprehensive income are attributable to the following items: Accelerated Retirement 2015 tax benefit depreciation Tax losses Obligations Total Rs 000 Rs 000 Rs 000 Rs 000 At July 01 (61) (Charged)/credited to profit or loss (570) At June Accelerated Retirement tax benefit depreciation Tax losses Obligations Total Rs 000 Rs 000 Rs 000 Rs At July 01 - As previously reported (66) effect of adopting IAS (Revised) - As restated (66) (Charged)/credited to profit or loss 5 (1 001) 392 (604) At June 30 (61) Deferred Tax Assets not recognised The group has unused tax losses of Rs million (2014: Rs 72.9 million) to carry forward against future taxable profit, which have not been recognised due to the unpredictability of future taxable profit. THE COMPANY The company has unused tax losses of Rs 51.5 million (2014: Rs 55.8 million) to carry forward against future taxable profit, which have not been recognised due to the unpredictability of future taxable profit. 17. INVENTORIES At cost Rs 000 Rs 000 Fertilizers and chemicals Food and beverages Retail Cleaning materials Cost of inventories recognised as expense

78 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, TRADE AND OTHER RECEIVABLES THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Trade receivables Deposit on investment in subsidiary Receivables from subsidiaries Loan receivable from related party Prepayments Other receivables (a) (b) (c) The carrying amounts of trade and other receivables approximate their fair value. The loan receivable from related party is unsecured, bears interest at 8.5% with no fixed repayment terms. At June 30, 2015, the amount of the provision was Rs 2,984,502 (2014: Rs 2,984,502) for the Group. The individually impaired receivables mainly relate to debtors with overdue balances. The ageing of these receivables is as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Over 6 months (d) At June 30, 2015, there were no trade receivables for the Group which were past due but not impaired. These relate to a number of independent customers for whom there are no recent histories of default. The ageing analysis of these receivables is as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Over 6 months (e) (f) The carrying amounts of trade receivables are all denominated in Mauritian Rupees. Movement in the provision for impairment of trade receivables are as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 At July 1, Provision for the year At June 30,

79 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 In determining the recoverability of trade receivables, the Group considers any change in the credit quality of the trade receivables from the date credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base being large and unrelated. Accordingly, the directors believe that there is no further credit provision required in excess of the allowance for doubtful debts. (g) The other classes within trade and other receivables do not contain impaired assets. 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. 19. ASSETS HELD-FOR-SALE 2015 Infrastructure Land cost Total 2014 Rs 000 Rs 000 Rs 000 Rs 000 At July 1, Expenditure incurred during the year Released to cost of land sold (5439) Transfer from land (Note 6) Transfer from Development Project Costs (Note 13) At June 30, Assets held-for-sale represent unsold plots of land as at June 30, 2015 in respect of agricultural morcellements at Ile D Ambre and Deux Bras and residential property developments at Rose Belle, Union Park and Cote D Or respectively. These plots are intended or expected to be sold in the foreseeable future and are stated at cost. 20. STATED CAPITAL AND THE COMPANY Stated Share Capital Premium Total 2015 & & & 2014 Rs 000 Rs 000 Rs 000 Issued and fully paid 389,851,812 Ordinary shares of Rs 1 each Rights attached to Ordinary shares The ordinary shares shall rank pari passu in all respects namely that at all general meetings of the Company, every Ordinary share shall on a poll confer one vote to its holder. 77

80 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, REVALUATION AND OTHER RESERVES Fair value Actuarial Revaluation reserve reserve reserve Total Rs 000 Rs 000 Rs 000 Rs 000 At July 1, (28 220) Increase in fair value of investments (Note ) Movement in reserve of associates Remeasurement of post-employment - (544) - (544) benefit obligations Reclassification - - ( ) ( ) At June 30, (28 106) At July 1, Decrease in fair value of investments (note (79 208) - - (79 208) 12) Movement in reserve of associates (2 826) (4 083) Remeasurement of post-employment - (139) - (139) benefit obligations Reclassification - (23 998) At June 30, (28 220) THE COMPANY At July 1, (139) Decrease in fair value of investments ( ) - - ( ) Remeasurement of post-employment - (544) - (544) benefit obligations Reclassification - - ( ) ( ) At June 30, (683) At July 1, Decrease in fair value of investments ( ) - - ( ) Remeasurement of post-employment benefit obligations - (139) - (139) At June 30, (139) Actuarial loss reserve represents the cumulative premeasurement of defined benefit obligation recognised. In accordance with IFRS, revaluation surplus recognised under previous GAAP can be reclassified to retained earnings. The Group and the Company have opted for the reclassification. Therefore, an amount of Rs 207,996,500 has been reclassified from revaluation and other reserves to retained earnings during the year. 78

81 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, BORROWINGS THE COMPANY Current Rs 000 Rs 000 Rs 000 Rs 000 Bank overdrafts Bank loans Non-current Bank loans Total borrowings (a) (b) Bank loans and bank overdrafts are secured by floating and fixed charges on the assets of the Group and the Company. The rates of interest on these loans vary between 5.65% and 10% per annum. The exposure of the Group s and the Company s borrowings to interest rate changes and the contractual repricing dates are as follows: 6 months or Over less months months 5 years Total Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 At June 30, 2015 Total borrowings At June 30, 2014 Total borrowings months or Over less months months 5 years 5 years Rs 000 Rs 000 Rs 000 Rs 000 THE COMPANY At June 30, 2015 Total borrowings At June 30, 2014 Total borrowings (c) The maturity of non-current borrowings is as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 After one year and before two years After two years and before three years After three years and before five years Over five years

82 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (d) The effective interest rates at the end of the reporting period were as follows: THE COMPANY % % % % Bank overdrafts 5.85% - 8.9% 5.85% - 8.9% 5.85% - 8.9% 5.85% - 8.9% Bank loans 5.85% % 5.85% % 5.85% 5.85% (e) (f) The borrowings are denominated in Mauritian Rupees. The carrying amounts of borrowings are not materially different from the fair value. 23. RETIREMENT BENEFIT OBLIGATIONS THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Amounts recognised in the statement of financial position: Defined pension benefits (note (a)) Other post-retirement benefits (note (b)) Amounts charged to profit or loss: Defined pension benefits (note (a)) Other post-retirement benefits (note (b)) Amounts charged to other comprehensive income: Defined pension benefits (note (a)) Other post-retirement benefits (note (b)) (a) Defined pension benefits The pension plan is a final salary defined benefit plan and is wholly funded. The assets of the funded plan are held independently and administered by Anglo Mauritius Assurance Society Ltd. 80

83 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (i) The amounts recognised in the statement of financial position were as follows: AND THE COMPANY Rs 000 Rs 000 Present value of funded obligation Fair value of plan assets (928) (853) Liability in the statement of financial position at end of year (ii) The amounts recognised in statements of profit and loss were as follows: AND THE COMPANY Rs 000 Rs 000 Current service cost Cost of insuring risk benefits 11 - Interest cost Total included in staff costs (note 27 (a)) (iii) The movement in liability recognised in statement of financial position is as follows: AND THE COMPANY Rs 000 Rs 000 At July 1, Charged to other comprehensive income Charged to profit or loss Employer contributions (60) (60) At June 30, (iv) The movements in the present value of the defined benefit obligations are as follows: AND THE COMPANY Rs 000 Rs 000 Present value of obligation at start of year Current service cost Interest cost Actuarial loss/(gain) 503 (83) Present value of obligation at end of year

84 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 v) The movement in the fair value of the plan assets are as follows: AND THE COMPANY Rs 000 Rs 000 Fair value of plan assets at start of year Interest income Cost of insuring risk benefits (10) - Employer s contribution Actuarial loss (41) (38) Fair value of plan assets at end of year (vi) The amounts recognised in profit or loss are as follows: AND THE COMPANY Rs 000 Rs 000 Current service cost Cost of insuring risks benefits 11 - Interest cost (vii) The amounts recognised in other comprehensive income are as follows: AND THE COMPANY Rs 000 Rs 000 Remeasurement on the net benefit liability: Losses on pension scheme assets (41) (84) Experience losses on the liabilities (336) (169) Changes in assumptions underlying the present value of the scheme (167) 114 (544) (139) (viii) The history of experience adjustments is as follows:- AND THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Defined benefit obligation (3 107) (2 288) (2 080) (1 492) (1 048) Fair value of plan asset Deficit (2 179) (1 435) (1 310) (836) (473) Experience gains/(losses) on (503) 83 (337) (258) 161 liabilities Experience losses on plan assets (41) (38) (46) (28) (19) 82

85 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (ix) The main actuarial assumptions used for accounting purposes:- AND THE COMPANY Discount rate 6.75% 7.5% Expected return on plan assets 6.75% 7.5% Future long-term salary increase 4.75% 5.5% Future guaranteed pension increase 0.00% 0.00% (x) (xi) The company expects to make a contribution of Rs 321,183 to the defined benefit plan during the next financial year. Sensitivity analysis on defined benefit obligations at the end of the reporting date: Increase Decrease Discount rate (1% movement) ( ) Future long term salary assumption (1% movement) ( ) An increase/decrease of 1% in other principal actuarial assumptions would not have a material impact on the defined benefit obligations at the end of the reporting period. The sensitivity above has been determined based on a method that extrapolates the impact on net defined benefit obligation as a result of reasonable changes in key assumptions occurring at the end of the reporting period. The present value of the defined benefit obligation has been calculated using the projected unit credit method. The sensitivity analysis may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated. (xii) The defined benefit plan exposes the Group and the Company to actuarial risks, such as longevity risk, currency risk, interest rate risk and market (investment) risk. (xiii) The funding requirements are based on the pension fund s actuarial measurement framework set out in the funding policies of the plan. (xiv) The weighted average duration of the defined benefit obligation is 17 years at the end of the reporting period. (b) Other retirement benefits Other retirement benefits comprise of gratuity on retirement payable under the Employment Rights Act

86 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (i) The amounts recognised in statements of financial position is as follows: Rs 000 Rs 000 Present value of unfunded obligation (ii) The amounts recognised in the statements of profit or loss is as follows: Rs 000 Rs 000 Current service cost Interest cost Total included in staff costs (note 27(a)) (iii) The movements in liability recognised in statement of financial position is as follows: Rs 000 Rs 000 At July 1, Charged to profit or loss Contributions paid (25 013) (5) At June 30, (iv) History of obligations, assets and experience adjustments:- Present value of defined benefit obligation AND THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 (21 882) (25 235) (22 624) (16 840) (15 109) Deficit (21 882) (25 235) (22 624) (16 840) (15 109) Experience gain/(losses) liabilities (v) For accounting purposes, the principal actuarial assumptions are: % % Discount rate 7.0% 8.0% Future salary increases 4.5% 5.5% 84

87 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (c) Retirement benefit obligations have been based on the reports submitted by Hewitt LY Ltd and Anglo Mauritius Assurance Society Ltd. 24. TRADE AND OTHER PAYABLES THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Trade payables Payable to subsidiaries Deposits on sale of land Accrued expenses Other payables (a) (b) The carrying amounts of trade and other payables approximate their fair values. Trade and other payables are denominated in Mauritian Rupees. 25. REVENUE THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Dividend receivable Proceeds from sugar, molasses and other products Sale of land Entrance fees, restaurant and retail shop revenues Other revenue OTHER INCOME THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Interest income Management fees Rental income Potato proceeds Sundry revenues

88 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, EXPENSES BY NATURE Depreciation on plant and equipment Depreciation on investment property THE COMPANY Rs 000 Rs 000 Rs 000 Rs Amortisation of intangible assets Cost of land sold Employee benefit expense (note (a)) Cultivation costs Other expenses (a) Employee benefit expense THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Wages and salaries Social security costs Pension costs - defined benefit plans (note 23(a)(ii)) Other post-retirement benefits (note 23(b)(ii)) FINANCE COSTS THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Interest expense: - Bank overdrafts Bank loans Other loans - related company

89 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, TAXATION (a) Statement of financial position Rs 000 Rs 000 At July 1, Current tax on the adjusted profit for the year 15% (2014: 15%) Overprovision in prior year (18) - Less: paid during the year - (13 357) At June 30, Analysed as: Income tax recoverable (255) (255) Income tax payable (b) Statement of profit or loss and other comprehensive income Current tax on the adjusted profit for the year 15% (2014: 15%) Deferred tax (note 16) (12 427) 604 Taxation charge (12 427) (c) The tax on the Group s profit before taxation differs from the theoretical amount that would arise using the basic tax rate as follows: Rs 000 Rs 000 Profit before taxation Tax calculated at a rate of 15% (2014: 15%) Share of results of associates (20 008) (11 824) Income not subject to tax (15 802) (9 678) Expenses not deductible for tax purposes 9, Tax losses for which no deferred tax asset has been recognised Tax charge (12 427)

90 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, EARNINGS PER SHARE THE COMPANY Basic earnings per share (Rs) (0.16) 0.30 Profit/(loss) attributable to equity holders of the company (Rs 000) (60 791) Number of ordinary shares in issue DIVIDENDS AND THE COMPANY Rs 000 Rs 000 Final dividend of Rs 0.10 (2014: Rs 0.12) per share NOTES TO THE STATEMENTS OF CASH FLOWS (a) Cash generated from operations THE COMPANY Note Rs 000 Rs 000 Rs 000 Rs 000 Profit before taxation (60 791) Adjustments for: Depreciation on property, plant and equipment Depreciation on investment property Amortisation of intangible assets Loss on disposal of property, plant and equipment Impairment loss on investment Amortisation of plant canes 14(a) Interest income 26 (448) (4 838) (74 645) (22 903) Interest expense Retirement benefit obligations (4 420) Release of assets held-for-sale Share of result of associates ( ) (78 826) (42 412) Changes in working capital - Inventories (1 245) Trade and other receivables ( ) (34 952) ( ) ( ) - Trade and other payables (42 797) (35 384) - Consumable biological assets 14(b) (3 945) Cash generated from operations ( ) ( ) 88

91 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 (b) Cash and cash equivalents Cash and cash equivalents and bank overdrafts include the following for the purpose of the statement of cash flows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Bank and cash balances Bank overdrafts (note 22) ( ) ( ) ( ) (33 139) ( ) (96 267) ( ) (20 721) 33. COMMITMENTS AND CONTINGENCIES (a) Capital commitments Capital expenditure contracted for at end of reporting date but not recognised in the financial statements are as follows: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Capital expenditure (b) Contingencies At 30 June 2015, the Group had contingent liabilities in respect of bank guarantees arising in the ordinary course of business from which it is anticipated that no material liabilities would arise. The Group has given guarantees amounting to Rs 3.2 Billion (2014: Rs 1.8 billion). 34. OPERATING LEASE ARRANGEMENTS Rs 000 Rs 000 Group as lessee Miminum lease payments under operating leases recognised as an expense this year ,100 At the end of the reporting period, the group has outstanding commitments under operating leases which fall due as follows: Rs 000 Rs 000 Within 1 year After 1 year and before 5 years After 5 years

92 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2015 Operating lease payments are rentals payable by a subsidiary for the lease of a portion of land at Belle Mare and is initially valid for a period of 20 years starting July 1, 2000 and expiring on June 30, 2020 with the option to renew for four further periods of 10 years. The Group does not have an option to purchase the leased land at the expiry of the lease period. Group as lessor Rs 000 Rs 000 Operating lease income from short term lease (note 26) Operating leases relate to the investment property owned by the Group and the annual rentals represent payment for occupation of premises. All operating lease contracts contain market review clauses in the event that the lessee exercises its option to renew. The lessee does not have an option to purchase the property at the expiry of the lease period. The future minimum lease repayments receivable under non-cancellable operating leases are as follows: Group as lessor Rs 000 Rs 000 Within one year Between two and five years After five years

93 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, RELATED PARTY TRANSACTIONS Transactions between the Company and its subsidiaries, which are related parties of the Company have been eliminated on consolidation and are not disclosed in this note. Details of transactions between the Group and other related parties and outstanding balances due from/to related parties are disclosed below: Purchase of goods or Dividend Amount Remuneration services receivable owed to Rs 000 Rs 000 Rs 000 Rs Associated company Directors and key management personnel Associated company Enterprise in which the company has significant indirect interest Directors and key management personnel The sales to and purchases from related parties are made at normal market prices. Outstanding balances at the year-end are unsecured, with no fixed terms of repayment, bearing interests rate of 8.5% p.a. There have been no guarantees provided for or received from any related party receivables or payables. For the year ended June 30, 2015, the Group has not recorded any impairment of receivables relating to amount owed by related parties (2014: Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. 91

94 ANNUAL REPORT 2015 NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, FINANCIAL SUMMARY Capital: THE COMPANY Rs 000 Rs 000 Rs 000 Rs 000 Rs 000 Rs Stated Capital Reserves: - Fair value reserve Actuarial reserve (28 106) (28 220) - (683) (139) - - Revaluation and other reserves - Retained earnings Profit/(loss) attributable to equity holders of the company (60 791) Dividends paid to equity holders of the company Earnings per share (Rs) (0.16) Dividend per share (Rs) Number of shares in issue

95