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ANNUAL INTEGRATED REPORT 2014
Our blueprint, our culture
Group overview
Operational highlights 04
Bidvest Namibia at a glance 06
Six-year review 08
Directorate 10
Executive committee members 12
Bidvest Namibia Limited abridged Group
Structure 13
Performance overview
Chairman’s review 16
Chief executive’s review 18
Bidvest Namibia Fisheries Holdings
operational review 22
Bidvest Namibia Commercial Holdings
operational review 26
Financial director’s review 32
Corporate governance 34
Group value added statement 37
Consolidated segmental analysis 38
Sustainability at Bidvest Namibia 40
Annual financial statements
Statement of directors’ responsibilities and
approval 48
Declaration by company secretary 48
Independent auditor’s report 49
Audit committee report 50
Directors’ report 52
Accounting policies 57
Statements of financial position 66
Statements of profit or loss and other
comprehensive income 67
Statements of changes in equity 68
Statements of cash flows 70
Notes to the financial statements 71
Shareholders’ diary 98
Administration 99
Our company logos 100
We are decentralised
Our blueprint, our culture
We believe in performance excellence
We haveshared values
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20141
Namibia
For access on your mobile to the Bidvest Namibia website, scan the barcode above.
All our company logos can be viewed on page 100 of this report.
Our blueprint
We have a diverse portfolio of businesses ranging from fishing, freight and logistics,
services, trading and distribution, which comprises well recognised brands within
the Namibian market.
Our fishing, freight and logistics, services, trading and distribution divisions employ
more than 3 200 people, creating shareholder value we report on.
Our philosophy we subscribe to in all our business dealings:
– Transparency
– Accountability
– Integrity
– Excellence
– Innovation
We continually strive to apply sustainable business practices throughout the Group,
which are managed by each business unit.
We remain alert for acquisition opportunities to reinforce our commercial activities.
We believe in creating opportunities and growing people. We understand that
people create wealth, and that companies only report it.
Our focus areas for our people is employment equity, industrial relations, employee
health and safety, developing Namibians and attracting and retaining skilled
Namibians.
In a big business environment we run our company with determination and
commitment evident in a small business heart.
Bidvest Namibia operates a decentralised and highly entrepreneurial
business model.
decentralisedWe are
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20142
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20143
Group overview
Operational highlights 04
Bidvest Namibia at a glance 06
Six-year review 08
Directorate 10
Executive committee members 12
Bidvest Namibia Limited abridged Group
structure 13
Our decentralised
and entrepreneurial business model
continues to prove itself
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20144
0
300
600
900
1 200
1 500
Share price1,6%
Cents
720802
1 071
1 251 1 273
1310 11 12 14
Operational highlights
REASONABLE RESULTS
– Bidvest Namibia delivered reasonable
results given the significant challenges
that were faced in the Fishing division.
OUR PEOPLE
– Investment in training our people rose
to NAD7,6 million in 2014. No fatalities
were recorded during the year.
GROWTH IN BUSINESS
– Manica started a bunkering business,
Monjasa Namibia and Manica Sourcing
and Trading. Waltons opened a new
branch in Okahandja.
0
20
40
60
80
100
120
140
160
Headline earnings per share10,4%
Cents
87,4
120,0
140,3129,5
116,0
1310 11 12 14
0
100
200
300
400
500
600
700
800
Net tangible asset value per share7,8%
Cents
410
500
578638
688
1310 11 12 14
0
10
20
30
40
50
60
70
80
Distribution per share8,7%
Cents
1521
1836
2340 23
46
2439
1310 11 12 14
Final Interim
0
500
1 000
1 500
2000
2 500
3 000
3 500
4 000
Revenue12,4%
NAD’million
1 608,11 918,8
2 730,7
3 294,2
3 703,5
1310 11 12 14
0
100
200
300
400
500
600
700
Trading profit16,7%
NAD’million
368,9
544,9
646,6601,5
501,3
1310 11 12 14
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20145
PROJECT ACTIVITY
– The Freight and Logistics division’s
revenue increased by 21% benefiting
from services to oil and gas exploration
and other projects.
TECHNOLOGY INVESTMENT
– We remain on board with latest
technology on our vessels, in our
commercial businesses to ensure best
practice and outstanding customer
service.
WEAK NAMIBIA DOLLAR
– Exchange rate weakness beneficial
but could not counteract the effects of
higher costs and lower selling prices.
0
100
200
300
400
500
Profit after tax19,4%
NAD’million
237,1
384,1
460,9426,5
343,7
1310 11 12 14
0
500
1 000
1 500
2 000
2 500
3 000
Total assets0,5%
NAD’million
1 724,71 940,3
2 468,6
2 778,6 2 764,5
1310 11 12 14
0
100
200
300
400
500
600
700
Operating profit16,4%
NAD’million
351,9
562,4
654,5599,1
501,0
1310 11 12 14
0
100
200
300
400
500
600
700
800
Cash generated by operations29,3%
NAD’million
431,7
545,3
625,1585,6
413,8
1310 11 12 14
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20146
Bidvest Namibia at a glance
Bidvest Namibia Management Services
Corporate services are provided through Bidvest Namibia Management Services, which
is the administration company for the Group.
Bidvest Namibia Properties
Bidvest Namibia Properties is the property holding company within the Group. All
properties are currently leased by subsidiaries.
Bidvest Namibia Information Technology
Bidvest Namibia Information Technology has offices and data centres in Windhoek and
Walvis Bay. Currently the full range of IT services is provided to the Bidvest Namibia
Group internally and some external clients.
DESCRIPTION OF BUSINESS
BIDVEST NAMIBIA Bidvest Namibia is a diversified group of companies listed on the Namibian Stock Exchange.
Namsov Fishing Enterprises
Namsov has been engaged in the horse-mackerel industry since 1990 and continues
to supply large quantities of horse-mackerel to West Africa and the SADC region.
Twafika Fishing Enterprises
Twafika is the holder of a monk fishing right and the beneficiary of annual monk
quotas.
Trachurus Fishing Enterprises
Trachurus is the holder of a monk fishing right and the beneficiary of annual monk
quotas.
Tetelestai Mariculture Tetelestai is an oyster farming company based in Walvis Bay.
Namibian Sea Products Namibian Sea Products (Namsea) is active in the inshore small pelagic fishing industry
with canning, fishmeal and fish oil processing facilities. Canned products are marketed
under the Ocean Fresh and Ekunde brands.
Pesca Fresca Limitada This is the Angolan operating company engaged in the small pelagic industry, mainly
sardinella and horse-mackerel.
DESCRIPTION OF BUSINESS
BIDVEST NAMIBIA FISHERIES HOLDINGS
Bidvest Namibia Fisheries Holdings is the holding company of the fishing subsidiaries.
Namibia Fisheries
DESCRIPTION OF BUSINESS
BIDVEST NAMIBIA COMMERCIAL HOLDINGS
Bidvest Namibia Commercial Holdings is the holding company of the commercial business division of Bidvest Namibia.
Namibia Commercial
Manica Manica provides freight and integrated supply chain solutions to Namibia.
Woker Freight Services With facilities in Walvis Bay, Windhoek, Oshikango and Hosea Kutako International
Airport, Woker Freight Services is the premier provider of freight management solutions
in Namibia. The range of services encompasses parcels, consolidation services, inter-
modal transportations, compliance management services, freight handling – air, sea,
road and rail for all types of cargo.
Lüderitz Bay Shipping and Forwarding
Your one-stop shipping, clearing, forwarding and warehousing provider in Lüderitz. This
company is a replica of Manica in Lüderitz on a smaller scale.
Rennies Consolidated Rennies Consolidated provides a full range of warehousing facilities, including container
depot and bulk storage facilities.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20147
Manica Logistic Services The “one point entry” for bigger projects, Manica Logistic Services offers logistics
consulting as well as developing integrated supply chain solutions for customers.
Walvis Bay Stevedoring Company
Walvis Bay Stevedoring has been recognised as one of the safest cargo handling
service companies in Walvis Bay and Lüderitz.
Manica Oil and Gas This division provides specialised logistics and project management services to the
oil and gas industry, exploration companies, rig and vessel owners and agents.
Ocean Liner Services Ships agency and husbandry services for both liner and non-liner shipping principals
have been offered by Ocean Liner Services for over 50 years.
MACS Agency Ships agency and husbandry services for the liner MACS.
GAL Agency Ships agency and husbandry services for the liner GAL.
MOL Agency Ships agency and husbandry services for the liner MOL, one of the 10 biggest liners
in the world.
Lubrication Specialists The largest supplier of marine lubricants in Namibia.
Walvis Bay Airport Services
Provides airport ground handling support at the Walvis Bay airport. It also offers an
around-the-clock specialised service to aircraft operators.
Manica Business Centre Provides ideal office-away-from-home facilities for foreign contracted personnel.
Manica Sourcing and Trading
A new venture aimed at providing specialised procurement and trading services to
the marine industry.
Monjasa Namibia A joint venture between Manica and Monjasa to provide bunkering services to vessels
along the west coast of Africa.
Food and Distribution Warehousing, distribution, sales and merchandising service providers of fast-moving
consumer goods to the Namibian retail and wholesale market.
Taeuber & Corssen Provides goods to the FMCG sector all over the country.
Caterplus Namibia Provides food solutions to the catering and hospitality industries.
ProTrade Agencies Provides mainly non-food goods to the FMCG sector in Namibia.
Commercial and Industrial Services
A full range of electrical equipment and consumables, stationery, office equipment,
furniture as well as hygiene rental equipment, travel management services and office
automation is offered by this division.
HRG Rennies Travel Namibia
The largest travel group and travel management service company in Namibia.
Minolco Namibia t/a Konica Minolta
A licensed distributor of Konica Minolta branded copiers, printers and multi-functional
machines. Minolco specialises in office automation.
Cecil Nurse Namibia A distributor of office furniture, home furniture and hospitality furniture, providing office
solutions with efficient, innovative designs.
Kolok Namibia The leading brands distributor of wholesale printer consumables, hardware and other
peripherals.
Waltons Namibia One of the leading retail office suppliers in the country.
Voltex Namibia A distributor of wholesale and retail electrical goods, equipment and energy-saving
products.
Bidvest Namibia Steiner A hygiene service rental company, committed to improving and enhancing every
company’s hygiene requirements as per their specific needs.
DESCRIPTION OF BUSINESS
BIDVEST NAMIBIA COMMERCIAL HOLDINGS
Bidvest Namibia Commercial Holdings is the holding company of the commercial business division of Bidvest Namibia.
Namibia Commercial
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20148
Six-year review
2014 2013
Extract from financial statements N$’000s
Revenue 3 703 495 3 294 235
Trading profit 501 313 601 497
Net finance income 16 298 15 690
Attributable profit 343 742 426 505
Shareholders’ interest 2 065 162 1 959 047
Total assets 2 764 518 2 778 557
Funds employed** 1 372 372 1 199 271
Cash generated by operations 413 761 585 583
Wealth created by trading operations 1 158 871 1 204 599
Employee benefits and remuneration 550 960 483 638
Share statistics
Headline earning per share (cents) 116,0 129,5
Ordinary distribution per share (cents) 63,0 69,0
Distribution cover (times) 3 3
Distribution yield (%) 5 6
Earnings yield (%) 9 10
Net tangible asset value per share (cents) 688 638
Share price (cents)
high 12,73 12,71
low 12,50 10,71
closing (June 30) 12,73 12,51
Market capitalisation (NAD’million) 2 698 162 2 651 532
Volumes traded (000’s) 1 304 4 340
Volumes traded as % of weighted number of shares 1 2
Ratios and statistics
Return on total shareholders’ interest (%) 24 31
Return on average funds employed (%) 39 54
Trading profit margin (%) 14 18
Interest cover 21 27
Current asset ratio 3,8 3,0
Quick asset ratio 2,9 2,4
Number of employees 3 239 3 203
Revenue per employee (NAD’000) 1 143 1 028
Value added per employee (NAD’000) 358 376
Number of shares in issue (000’s) 211 953 211 953
Number of weighted shares in issue (000’s) 211 953 211 953
Exchange rate comparisonsNamibia dollar/US dollar
Closing rate 10,70 10,24
Average rate 10,32 8,86
* Value added statement only prepared from 2012 onwards.
** Funds employed = total assets excluding cash and cash equivalents, taxes (current and deferred) and goodwill; less total liabilities excluding taxes (current and deferred).
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 20149
2012 2011 2010 2009
2 730 667 1 918 804 1 608 101 1 387 590
646 616 544 922 368 869 284 496
17 606 6 085 1 253 3 402
460 880 384 079 229 680 183 344
1 711 976 1 401 728 1 156 007 655 795
2 468 625 1 940 353 1 724 735 1 073 018
1 038 630 680 991 564 526 414 208
625 123 545 332 431 704 240 378
1 203 998 * * *
435 779 365 669 315 896 263 301
140,3 120,0 87,4 79,0
63,0 54,0 36,0 15,0
3 3 3 7
6 7 5 not listed yet
13 16 12 not listed yet
578 500 410 240
10,71 8,20 7,20 not listed yet
8,02 7,20 6,99 not listed yet
10,71 8,02 7,20 not listed yet
2 270 017 1 659 763 1 490 062 not listed yet
2 935 1 846 1 561 not listed yet
1 1 1 not listed yet
38 39 32 43
75 88 75 69
24 28 23 21
26 63 183 54
3,0 3,2 2,5 1,8
2,4 2,7 2,0 1,3
3 110 2 690 2 568 1 998
878 713 626 694
387 – – –
211 953 206 953 206 953 163 303
209 862 206 953 192 363 163 303
8,33 6,75 7,62 8,27
7,77 6,98 7,61 9,28
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201410
Directorate
EXECUTIVE DIRECTORS
NON-EXECUTIVE DIRECTORS
Lindsay Ralphs 59
Qualification: CA(SA)Appointed: March 3 2014
Lindsay is chief executive of Bidvest South Africa
and a director of various Bidvest subsidiaries.
Lindsay joined Bidvest as operations director in
1992. In 1994, he was appointed managing
director of Steiner. Following the acquisition of
Prestige, Bidserv was created. Lindsay became its
chief executive. Lindsay was appointed CE of
Bidvest South Africa in February 2011. Lindsay was
appointed to the board of Adcock Ingram in 2014.
Sebulon Inotila Kankondi48
Qualification: Post-graduate degree: Business Administration (Unisa)Appointed: August 10 2007Director of several Bidvest Namibia subsidiaries,
Sebby joined Bidvest Namibia after he spent six
years as the Managing Director of the Namibian
Ports Authority. He was trained as a mechanical
engineer and holds a degree in Business
Administration. He has also successfully completed
UCT and Stellenbosch Business School
Programmes in Marketing and Business
Management and Leadership. He took part in more
than three assignments in the Middle East, Norway
and the USA exposing him to modern management
practices in freight and logistics.
Board committee membership: Nomination, acquisition, risk and executive (chairman)
Chief executive officer
Jan Arnold
55
Qualification: BCom (Accounting) (Pretoria)Appointed: January 17 2007Director of several Bidvest Namibia subsidiaries,
Jan has more than 27 years’ executive experience
in the fishing and mining industries. He is a council
member of the University of Namibia and a trustee
of the Namsov Community Trust. He is a former
member of the Advisory Council of the Ministry of
Fisheries and Marine Resources, the Sam Nujoma
Marine and Coastal Resources Research Centre
and the Midwater Trawl Association of Namibia. In
addition, Jan is a former trustee of the Namibian
Maritime and Fisheries Training Institute.
Board committee membership: Acquisition, risk and executive.
Managing director of Bidvest Namibia Fisheries Holdings
Theresa Weitz37
Qualification: CA(Nam), B Accounting (Hons) (Stellenbosch)Appointed: August 18 2011Director of several Bidvest Namibia subsidiaries,
Theresa has 12 years’ managerial experience
across various industries. She is a former group
financial manager of the Ohlthaver & List group of
companies.
Board committee membership: Acquisition, risk and executive
Financial director
Martin Kaali Shipanga 46
Qualification: BCom (Wits), Masters in Public Policy and Administration
Martin completed in-service-training at De Beers
prior to serving the City of Windhoek for 10 years,
initially as deputy head of finance and then as
deputy chief executive before becoming the city’s
chief executive. In 2004, he became a member of
the founding executive team at Nedbank Namibia
and was the bank’s first indigenous managing
director. Martin subsequently established
SmartSwitch Namibia, a joint venture between
Nampost and Net 1 Technologies.
He has served as a director of various public and
private companies and currently sits on the boards
of Zebra Holdings, Ebank and Mutual & Federal.
He is chairman of the Frans Indongo Group.
Martin is a full-time entrepreneur and manages a
property portfolio. In addition, he is the founder of
Mamma Fresh, Moola Mobile and Tusk Mobile &
Electronics.
Board committee membership: Audit and risk (chairman)
Hans-Harald Müseler 65
Qualification: CA(Nam)/(SA) MBA (Stellenbosch)Hans-Harald, a professional with 22 years’
experience as an accountant and auditor, retired
as a partner in the assurance division of
PricewaterhouseCoopers. He is an independent
non-executive director and serves on the boards of
entities in the private and public sectors of
Namibia.
Board committee membership: Audit (chairman), remuneration and risk
Lindsay Ralphs Sebulon Kankondi Jan Arnold Theresa Weitz Martin Shipanga Hans-Harald Müseler
NON-EXECUTIVE CHAIRMAN
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201411
David Edward Cleasby 52
Qualification: CA(SA)
A director of numerous Bidvest subsidiaries and
associate companies and Financial Director of The
Bidvest Group Limited. David was financial director
of Rennies Terminals when Bidvest acquired
Rennies in 1998. In 2001, he joined Bidvest
corporate office, where he has been involved
in both Group corporate finance and investor
relations.
Board committee membership: Audit, remuneration (chairman) and acquisition
Martina Mokgatle-Aukhumes 45
A director of several boards in the fishing industry,
Martina is a communication and public relations
specialist. She has executive experience in the
Ministries of Education, Regional and Local
Government and Fisheries and Marine Resources
and has held senior positions with Sea Harvest and
Alexander Forbes Group Namibia. Martina is
currently executive director of Naneni Investments
and the Bonsai Fishing and Aquaculture Project.
Frans Kapofi 61
Qualification: Diploma in Modern Management Administration (Cambridge Tutorial College, Britain), MBA (Eastern and Southern African Management Institute, Arusha, Tanzania) Appointed: March 3 2014
After independence in 1990, Frans was appointed
Namibia’s first permanent secretary and
accounting officer at the Ministry of Defence. He
joined the Ministry of Prisons and Correctional
Services as its first permanent secretary and
accounting officer in 1995, a position he held until
his 1999 appointment to his current position as
secretary to the Cabinet.
Frans serves on a number of boards. He is also
group chairman of Western National Insurance
Holdings, chairperson of the Namibia Institute of
Public Administration and Management (NIPAM)
Governing Council, chairman of the SME Bank
board of directors and board chairman of the
August 26 Holdings Company.
Birgit Eimbeck 37
Qualification: CA(Nam), Certified Internal Auditor, BCom (Acc) (Hons) (Pretoria), BPhil (Applied Ethics) (Stellenbosch) Appointed: March 3 2014
A non-executive director of Standard Bank Namibia
and Namibia Asset Management, Birgit is a
previous director of the Namibia Water Corporation
and chaired its audit committee. She has 11 years’
experience in various companies at group financial
manager level, including exposure to the fishing
industry as well as running her own business.
Konrad Ernst Taeuber 67
Qualification: National Diploma in Industrial Administration and MTM 1, 2 and 3, BCom (Unisa), Fellow of the Institute of Directors. Resigned: August 22 2014Director of Taeuber Management Trust, SMC Brands, T&C Properties and Fountainhill Estates, Konrad has served as an executive director of Bayer SA and is currently executive chairman of Taeuber & Corssen (Pty) Limited. He has served as a director of numerous companies and charities and is a trustee of the Alfons Weber Foundation, Swakopmund. Konrad is a past chairman of the Institute of Directors and helped to prepare the King II Report on Corporate Governance in South Africa.
Board committee membership: Nomination
Brian Joffe 67
Qualification: CA(SA) Director of numerous Bidvest subsidiaries and
chief executive of The Bidvest Group Limited,
Bidvest Namibia’s holding company.
Brian founded The Bidvest Group Limited in 1988
and was appointed chief executive in 2004. He
has over 34 years’ South African and international
commercial experience. He was one of the Sunday
Times’ top five businessmen in 1992 and is a past
recipient of the Jewish Business Achiever of the
Year award.
Brian was listed as one of the Top 100 Africans of
the Year in the 2001 Africa Almanac and was
voted South Africa’s Top Manager of the Year in
2002 in the Corporate Research Foundation’s
publication “South Africa’s Leading Managers”.
He represented South Africa at the Ernst & Young
World Entrepreneur of the Year awards in 2003
and was Sunday Times’ Businessman of the Year
in 2007. Brian was awarded an honorary doctorate
by Unisa in 2008 and in 2010 was saluted by the
WBS (Wits Business School) Journal as one of
South Africa’s top 25 business leaders.
Board committee membership: Acquisition (Chairman)
Pieter Christiaan Steyn 66
Qualification: PMD, Harvard
Director of several Bidvest subsidiaries. Pieter
has over 36 years’ experience in the fishing,
freight, logistics, terminals and travel industries.
Board committee membership: Nomination
Konrad Taeuber Brian Joffe David Cleasby Frans Kapofi Pieter Steyn Birgit Eimbeck Martina Mokgatle-Aukhumes
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201412
Back: H Timke, T Mberirua, W Schuckmann, Q King.
Front: J Arnold, T Weitz, S Kankondi.
Executive committee members
Sebulon Inotila Kankondi
Chief executive officer
Theo Mberirua
52
Qualification: BSc (Mercy College, New York), MBA (Accounting) (Baruch College of the City University of New York)
Theo has held senior executive positions at several
major corporates, including Namibia Breweries,
Lonrho, Telecom and Standard Bank and has
lectured on business subjects in both the USA and
Namibia. He was a member of the Presidential
Economic Advisory Council. In addition, Theo is part
of the executive team at the Namibia Chamber of
Commerce and Industry and is a former chairperson
of the SADC Banking Association. He joined Bidcom
as Commercial and Business Development Director
in April 2012.
Commercial director of Bidcom
Quentin King
70
Quentin held a series of management positions in
various divisions of the Barlow’s Group in South
Africa, before joining the Namibian executive
team at Michelson’s (later National Cold Storage),
a division of the Taeuber & Corssen Group, in
1992. He became managing director of Taeuber
& Corssen SWA in May 1999. He retired on
June 30 2014.
Managing director of Food and Distribution
Werner Schuckmann
Qualification: CA (Nam)/SA B Accounting (Hons) (UCT)
Werner, a chartered accountant, spent several
years in Europe in the transaction services industry
before returning to Namibia to take executive
responsibilities in several sectors. He joined
Bidvest Namibia in January 2012 to oversee
businesses in the Commercial and Industrial
Products and Services operations of the Bidcom
division.
48Managing director of Commercial & Industrial Products & Services
48
Jan Arnold
Managing director of Bidvest Namibia Fisheries Holdings 55
Theresa Weitz
Financial director 37 Hans-Werner Timke
Qualification: CA(SA), BCom (UCT)
Hans-Werner has international and Namibian
experience in financial and general management in
the mining, dental, oil and gas, seafood and freight
industries, among others. He joined Manica as
financial director in 2004 and became managing
director in 2005. In 2007, on the formation of
Bidvest Namibia, Hans-Werner assumed the
additional role of Bidcom managing director. This
later became a full-time role. When Bidcom was
split into three focus areas in 2012, he resumed
his role as managing director of the Freight and
Logistics business.
50Managing director of Freight and Logistics
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201413
Bidvest Namibia Limited abridged Group structure
Bidvest Namibia is a subsidiary of The Bidvest Group Limited
BIDVEST NAMIBIA LIMITED
Bidvest Namibia
Fisheries Holdings
(Bidfish)
100%
Bidvest Namibia
Management Services
Bidvest Namibia
Information Technology
100% 100%
Bidvest Namibia
Commercial Holdings
(Bidcom)
100%
Bidvest Namibia Property
Holdings
100%
Namibian Sea Products 100%
Namsov Industrial Properties 100%
Trachurus Fishing 51%
Twafika Fishing Enterprises 75,10%
Comet Investments Capital 100%
Tetelestai Mariculture 100%
Mukorob Pelagic Processors 100%
Namfish Pelagic Industries 100%
!OE#GAB Fishing Enterprises 50%
Sarusas Development Corporation 100%
United Fishing Enterprises 100%
Atlantic Harvesters of Namibia 100%
Pesca Fresca LDA 49%
Elzet Development 100%
T&C Properties Namibia 100%
Food & Distribution
Taeuber & Corssen (SWA) 100%
Freight & Logistics, Material Handling & Marine Services
Manica Group Namibia 100%
Commercial & Industrial Services
9,5%
* Manica Group Namibia entered into a joint venture with Biamark (Pty) Ltd who owns a 35% shareholding in Monjasa effective July 1 2014.
Lubrication Specialists 100%
Lüderitz Bay Shipping & Forwarding 100%
Monjasa Namibia 100%*
Walvis Bay Airport Services 100%
Walvis Bay Stevedoring Company 55%
Woker Freight Services 100%
Matador Enterprises 100%
ProTrade Agencies (Division of T&C)
T&C Trading 100%
Caterplus Namibia 100%
Bidvest Namibia Steiner (division of Bidcom)
Cecil Nurse Namibia 100%
Kolok (Namibia) 100%
Minolco (Namibia) (trading as Konica Minolta) 100%
Rennies Travel (Namibia)100%
Voltex (Namibia) 100%
Waltons Namibia 100%
Namsov Fishing Enterprises 69,55%
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201414
performance excellenceWe believe in
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201414
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201415
Performance overview
Chairman’s review 16
Chief executive’s review 18
Bidvest Namibia Fisheries Holdings
operational review 22
Bidvest Namibia Commercial Holdings
operational review 26
Financial director’s review 32
Corporate governance 34
Group value added statement 37
Consolidated segmental analysis 38
Sustainability at Bidvest Namibia 40
We turn ordinary
business into extraordinary
performers
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201416
Chairman’s review
HIGHLIGHTS
– Headline earnings per share 116,0 cents (2013: 129,5 cents)
– Dividend of 63,0 cents declared (2013: 69,0 cents)
– Lower dividend and declining trading profits highlight impact of policy challenges
– Namibianisation strategy makes continued progress
– Renewed focus on diversification of our base of business
– Commercial businesses make encouraging progress
– Innovation continues with focus on new markets
– Investment in new infrastructure maintained
– Commitment to acquisitive growth reaffirmed
This is my first report to stakeholders of Bidvest Namibia Limited and let me say at the outset how honoured I am
to serve as chairman of this dynamic and innovative Group. I benefit greatly from the support of an experienced and
knowledgeable board of directors and an energetic and very capable management team. Together, I am confident we
can maintain the growth of this proudly Namibian business while making a sustained contribution to the nation it serves.
At this juncture, it is also appropriate to pay tribute to the work of my predecessor as chairman, Brian Joffe.
Brian led Bidvest Namibia from the time of its listing on the Namibian Stock Exchange in October 2009 until earlier this
year. Under his stewardship, Bidvest Namibia achieved sustained growth, becoming one of the largest employers in the
country while delivering significantly enhanced value to shareholders. All team members at Bidvest Namibia benefited
from his wisdom and guidance. Brian Joffe laid some impressive foundations and will remain on the board of directors.
My task as incoming chairman is to build on them.
OVERVIEWOverall results were somewhat disappointing, though our teams performed well in the face of significant challenges. The
impact of lower horse-mackerel selling prices, lower direct quota allocated in the last two years and increased costs
in securing outside quotas was the major cause of a significant fall in trading profit, down 16,7% to NAD501,3 million.
Our fishing businesses remain highly efficient. Our crews are well trained and ably led and our vessels are well equipped.
They did well to achieve a measure of profitability, albeit at lower levels, while maintaining the Bidfish reputation for
exceptional product quality.
By and large, our commercial operations made encouraging progress and we witnessed a significantly improved
contribution from these businesses. Unfortunately, their gains could not entirely offset the pressures faced by Bidfish.
The national economy continued on the growth path, though the rate of growth appeared to be moderating as the year
wore on. New investment in the mining industry, notably in the uranium sector, contributed to growth, as did activities
in the oil and gas industry. The consumer economy continued to grow in importance, though consumer spending was
generally subdued.
Our commercial businesses optimised these opportunities while seeking continued efficiencies.
The Namibia dollar weakened during the review period. Generally, a measure of currency softness is beneficial for
Bidvest Namibia as the Bidfish catch is sold on international markets in US dollars. The foreign exchange benefit was not
enough to offset the double impact of increased costs in securing outside quotas and lower selling prices.
POLICY IMPACTSIn these circumstances, the alert sounded by my predecessor in the previous annual report takes on added weight. At
that stage, it was pointed out that the impact of lower direct quotas granted by the Ministry of Fisheries and Marine
Resources had been cushioned to a certain extent by firm prices for our fish and positive currency effects. However,
these fortunate circumstances should not cloud the wider issue of policy effects and the potential for serious impact
on our business.
This assessment went unheeded and quotas were once again reduced with the second quota allocation for the 2014
calendar year. This time there is no ‘cushion’ and the consequences have been severe on the results post financial
year-end.
Policy and how it is implemented not only affect the
bottom line of a business, they also affect lives, jobs and
resources.
Bidfish sought continued efficiencies during the year
and made strenuous efforts to maximise fleet utilisation.
Clearly, as volumes and profits fall, a business has to
reduce expenses and overheads. Management delayed
the inevitable as long as possible, but early in the new
period the decision was taken to lay up two vessels and
send crews home.
The reduction in quotas made it impossible to maintain
all vessels at sea. The volumes simply did not warrant
full allocation of our resources. The decision was taken
with great regret, but ultimately we were left with little
alternative.
In our view, our modern, efficient fishing fleet is a
national asset. Its deployment contributes to the food
security of millions of Africans.
Admittedly, various needs and priorities have to be
balanced by national policymakers. This is no easy task.
However, it is in the interest of all parties that a solution
be found.
The needs of new entrants to the fishing industry cannot
be ignored, but the need to keep Namibian crews in
work and an efficient fishing fleet in being also deserves
consideration.
PROUDLY NAMIBIANAt the time of our listing, Bidvest Namibia was at
pains to address the challenge of black economic
empowerment and broad-based Namibian participation
in the ownership structure. The strategy called for the
development of a proudly Namibian business that would
grow Namibian jobs and contribute to the training and
development of Namibian people. A further objective was
the closest possible alignment with the communities
served by the Group.
In tandem with our empowerment partners at Ovanhu
Investments we have consistently applied this strategy.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201417
Our early commitment to employment equity and staff development has enabled us to make significant progress with
Namibianisation. This is work in progress, but gains have been considerable.
We are proud of our role in training Namibian managers and officers. Namibian executives drive Bidvest Namibia by
securing business growth that both sustains and create local jobs.
At the same time, our businesses – in collaboration with partners such as the Namsov Community Trust and the Pandula
Trust – have maintained their commitment to socio-economic development in communities across Namibia.
In 2014, our status as a truly Namibian brand was again spotlighted by our sponsorship of the Bidvest Namibia Cup,
a national soccer tournament that has taken off with fans all over the country.
These initiatives continue. Bidvest Namibia commits to the long haul and seeks sustainability in all aspects of
its business.
DIVISIONAL PERFORMANCE
Our horse-mackerel business, Namsov – historically the single biggest contributor to our earnings – faced pressure in
view of lower direct quotas and higher quota acquisition costs. Typically, our teams continued to innovate and seek new
opportunities. Tetelestai made continued progress with the development of open ocean oyster farming and our sardine
businesses put in a good showing.
Bidcom teams made a stronger contribution, notably at Freight and Logistics, and Commercial and Industrial Services.
Momentum is still being built at Food and Distribution. Investment in new infrastructure was maintained and Manica
entered the market for office support services.
EARNINGS AND DIVIDENDS
Headline earnings per share decreased by 10,4% to 116,0 cents per share (2013: 129,5 cents per share).
In view of materially lower trading profits, the board decided to declare a dividend of 63 cents (2013: 69 cents).
APPRECIATION
The people of Bidvest Namibia again demonstrated their resilience and hard work in sometimes challenging conditions.
I thank all our people for their efforts. I also extend my thanks to our management teams for their commitment
and dedication.
To my new colleagues on the board of Bidvest Namibia, I express my deep appreciation for guidance, patience and
support. Your insights have been invaluable and I look forward to our continued collaboration.
GOING FORWARD
The commitment to growth at Bidvest Namibia is as strong as ever. The challenges of the past year confirm the strategic
necessity for the continued diversification of our base of business – through innovation within our existing operations,
through entry into new markets by teams eager to develop new revenue streams and through strategic acquisitions.
No acquisitions were made in 2014, but our appetite for acquisitive growth remains undiminished, especially if it
contributes to further diversification.
In our quest for growth we will not restrict ourselves to activities in which we have a long-established base. Entirely new
areas of opportunity will be explored. We are an entrepreneurial Group and we will pursue all avenues that will enable
us to unlock value.
Our fishing operations will examine opportunities for
range extension and the application of new technology.
Growth of our Angolan interests is a particular area of
focus. As always, the long-term recovery of Namibia’s
fish resource is of critical importance to us and we will
continue our long-standing cooperation and collaboration
with the Ministry of Fisheries and Marine Resources.
Businesses across the Group continue to invest in new
infrastructure while exploring new opportunities, and
early in our 2015 financial year Manica expanded its
base by entering the market for bunkering services, an
area that offers substantial growth potential.
Our commercial operations developed strong impetus in
2014. This will be maintained in the coming year.
The pursuit of efficiencies and service improvements
remains an area of focus. Where appropriate, product
and service innovation will be accelerated by utilising our
association with the international Bidvest Group.
The development of talented Namibians remains both
a national and a Group priority. Accordingly, we will
continue to step up our investment in the people of
Bidvest Namibia.
We are positive about the potential for continued
growth within the Group and every bit as positive about
prospects within Namibia itself. We are proudly Bidvest.
Lindsay Ralphs
Non-executive chairman
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201418
Chief executive’s review
HIGHLIGHTS AND CHALLENGES
– Revenue up 12,4% at NAD3,7 billion (2013: NAD3,3 billion) – Operating profit dropped to NAD501,0 million (2013: NAD599,1 million)
– Continued pressure on Bidfish in view of ongoing lower direct quotas and the high cost of acquiring fishing quotas from third parties
– Exchange rate weakness beneficial but could not counteract the effects of higher costs and lower selling prices
– Sardine businesses perform well – Stronger contributions by Freight and Logistics, and Commercial and Industrial Services
– Waltons turnaround gained ground and Kolok performed strongly – Namibianisation programmes make continued progress – No serious accidents were recorded
OVERVIEW
Mixed results were achieved by Bidvest Namibia in the face of significant challenges in our fishing operations.
In the 2012 calendar year, quotas allocated to Namsov and its joint-venture partners by the Ministry of Fisheries and
Marine Resources were significantly below previous levels. In 2014, during the second allocation, it worsened.
Further reduction in direct quotas, at a time when the key horse-mackerel resource has recovered, will have a material
impact on our volumes and our capacity to grow Namibian jobs.
Previously, the effects of lower direct quotas were ameliorated by firmer market prices for horse-mackerel and pilchards.
In 2014, selling prices softened considerably, with material effects on Bidfish and the overall profitability of Bidvest
Namibia. However, our sardine businesses maintained recent momentum and put in a good performance.
Exchange rate weakness was beneficial to some extent, but could not counteract the twin effects of lower selling prices
and higher costs.
Pleasing improvements were achieved by some of our Bidcom businesses.
Freight and Logistics, and Commercial and Industrial Services made stronger contributions. Food and Distribution made
progress, but the full effects of management restructuring at Caterplus and investments in expanded infrastructure were
not entirely evident by year-end.
Freight volumes were up significantly at Freight and Logistics. Divisional performance also benefited from solid demand
from customers engaged in oil and gas exploration.
Gains were achieved by almost all business in the Commercial and Industrial Services division. Closer cooperation with
their peers in Bidvest South Africa contributed to higher market share and efficiency improvements.
Infrastructure investment by government and the creation of new retail centres were beneficial while travel results were
lifted by customer service enhancements, IT upgrades and a growing influx of business travellers.
The Waltons turnaround strategy gained traction and Kolok had an exceptional year on the back of strong sales of
consumables. Minolco achieved good sales in a challenging environment. Cecil Nurse enjoyed several significant
tender successes and Steiner turned in a much improved performance following a restructuring. However the Voltex
results were disappointing.
Food and Distribution made some gains, but the benefit of the turnaround strategy at Caterplus will not be evident until
the new period. However, this business moved back into profit.
T&C added confectionery ranges to its basket of brands. However, integration of ProTrade Agencies – acquired in the
prior period – took longer to achieve than anticipated. The realisation of synergies and efficiencies is receiving focused
management attention.
Food and Distribution is one of Namibia’s few substantial
distribution businesses with national reach. Investment
in strategic infrastructure positions the division well for
future growth.
FINANCIAL RESULTS
At NAD3,7 billion (2013: NAD3,3 billion), revenue was up
12,4%. However, operating profit was significantly lower
at NAD501,0 million (2013: NAD599,1 million).
Cash generated by operations decreased by 29,3% to
NAD413,8 million (2013: NAD585,6 million).
STRATEGIES AND CHALLENGES
Bidvest Namibia is committed to the market it serves.
The strategic vision that determines the long-term
planning of our businesses is closely aligned with many
of the macro-economic and developmental strategies
of policymakers.
For example, food security has become a key policy goal
for many nations in Africa, including Namibia. To feed
people it is necessary to create and expand efficient
businesses that provide large volumes of food products
at prices ordinary people can afford.
Our fishing businesses have become an important
contributor to the food security of many African countries.
A Bidfish estimate indicates that its fishing fleet provides
affordable protein to 3 million Africans every day – at
least, that was the statistic until recently.
In view of the policy spotlight on food security, one
would think the future is bright for such an efficient,
large-volume contributor to the daily protein intake.
However, other policy dynamics have the potential to
limit this contribution.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201419
In Namibia, another policy dynamic involves the encouragement of small entrepreneurs, including community-based
entrepreneurs looking to enter the fishing industry. These newcomers receive growing fishing quotas.
This trend is understandable. However, higher allocations to small, under-resourced entrants translate into lower
allocations for major local operators like Namsov.
There comes a point when the major player has to cut back to contain expenses and protect jobs. By year-end that
point was close at Namsov and Trachurus, our horse-mackerel fishing businesses. To make meaningful savings, vessels
ultimately have to be taken out of service and laid up.
Efficient, large-scale trawling capacity is then removed. This flies in the face of the overarching priority of policymakers
– food security. Africa needs affordable protein from efficiently harvested fish stocks. This means Africa needs to keep
its modern fishing fleets operational.
Impacts have to be carefully considered by policy implementers.
New policies can be introduced quite quickly, with significant impact in short order. It is not nearly so easy to institute
corrective action once a false step has been taken.
The Namibian authorities have not only changed the traditional balance in the allocation of fishing quotas, they have
also restricted the import of poultry and dairy products to protect local producers. The net effect is to drive up prices.
Consumers then seek more affordable alternatives. In Nigeria, the authorities have banned certain fish imports. In the
DRC, price limits have been imposed on some fish products.
All interventions come at a price – to consumers and to businesses whose volumes are affected – necessitating a
search for alternatives.
Major companies are in business for the long haul. They hope to work in partnership with governments to achieve
long-term national objectives. Proper partnership works for all parties. Consumers benefit from assured supplies at
affordable prices. Business benefits from greater policy certainty. Government benefits as its private sector partners
help it achieve its goals.
The challenge is to find the correct balance to ensure other players like community-based fishing operations and local
poultry and dairy suppliers are also accommodated. Balance can best be achieved by timely consultation well ahead of
the implementation of new policies.
LONG-TERM VISION
Another long-term vision – of policymakers and those who believe in Africa’s potential – relates to the growth of
consumer markets. Africa has a young, growing population. A new middle class is emerging with new needs. The
desires and expectations of these salary-earners are already having positive impact on markets across Africa. Namibia
is no exception.
To serve these consumers, retail chains and quick service
restaurant brands are investing in new infrastructure.
New shopping centres are cropping up. Established retail
centres are being expanded.
This bodes well for the growth of our commercial
businesses. For example, T&C provides aspirational
brands while Caterplus addresses the growing demand
for out-of-home eating.
At the same time, we see new residential projects under
way as developers look to satisfy the middle-class
demand for better housing.
ProTrade Agencies has a key role to play as families
are formed and homes are established. This recently
acquired business markets small appliances, non-food
categories and hardware – products needed by our
growing middle class.
Again, businesses at Bidvest Namibia are well positioned
to take advantage of national developments. As strategic
opportunities occur, the management challenge is to
ensure vigorous action at operational level. To this effect,
management teams will continue to be strengthened and
receive the support they need.
POLICY-DRIVEN GROWTH
On occasion, policy changes generate more opportunities
than risk. This was demonstrated by government
efforts to assist small and medium enterprises. It has
become standard practice for government departments
in Namibia to award a wide range of tenders to SMEs.
Ostensibly, this creates a challenge for larger businesses
that no longer benefit from direct government business.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201420
Chief executive’s review continued
However, it rapidly became apparent that smaller operators need the support of larger businesses able to supply
equipment and consumables from reputable brands, as well as to provide affordable credit terms.
SMEs are now a fast-growing segment of the Bidcom customer base.
The smaller entrepreneur may have received a sizeable contract, but often lacks the capital to procure the necessary
equipment. We responded by setting up a fund that enables SME customers to receive up to NAD20 million to cover the
cost of equipment and items specified in a government tender.
The credit line supported sales growth at businesses such as Minolco, Voltex, Waltons and Cecil Nurse.
INNOVATION AND NEW INVESTMENT
To secure sustainable growth, innovation must be constant. Established practice should not constrain the search for
new solutions.
Namsov has long been a principal driver of our profits. Its operations are extremely efficient and highly successful. This
did not prevent our horse-mackerel fishing business from carrying out an extensive investigation of the benefits – or
otherwise – of new refrigerated seawater (RSW) technology.
Currently, Namsov’s pelagic trawlers freeze, store and pack fish on board. Namsov invested NAD10,5 million in the
charter of an RSW trawler to investigate a key alternative. The RSW system brings the catch to harbour for onshore
processing. The Namsov initiative confirmed the viability of this approach. At a later stage, this may pave the way for
reinvention, leading to greater use of shore-based facilities.
Innovation is also apparent at Freight and Logistics. The division expanded into “away-from-home” services (office
space, office equipment and office support) by launching the Manica Business Centre. By year-end, preparations were
also being finalised for the establishment of a bunkering services business to supply oil and diesel to marine customers.
Manica continued to implement service improvements at its existing operations and introduced a web-based track and
trace system.
At Food and Distribution, investment was maintained in the expansion and refurbishment of its retail infrastructure.
Caterplus now has a national network of branches.
Efficiency gains were also secured by the roll-out of the T&C IT system across the Food and Distribution business.
Within Commercial and Industrial, Waltons completed the upgrade of its accounting system.
OUR PEOPLE
We are a people-driven business. Our people are a source of competitive advantage and we are committed to continued
investment in their development.
In 2014, our total investment in training, learnerships and bursaries rose from NAD5,8 million to NAD7,6 million.
Safety training is a focus area across all businesses. Some of our operations are inherently hazardous. I am happy to
report, however, that there were zero fatalities in 2014.
Another key area is our Namibianisation programme.
We take pride in our efforts to Namibianise operations that were historically reliant on foreign expertise. Our international
training scheme to develop Namibian officers for Namibian vessels continues to achieve good results. Officers’ training
in Kaliningrad, Russia, is complemented by other initiatives such as learnerships, bursaries and partnerships with the
Namibian Maritime and Fisheries Institute and the Cape Peninsula University of Technology in South Africa.
GOVERNMENT INITIATIVE WELCOME
Our substantial commitment to training predates government’s recent introduction of a national training levy. The levy
has been set at 1% of payroll, though companies that invest in training can claim back half their training expenditure.
The levy adds considerably to our costs at a challenging time. Even so, Bidvest Namibia sees the necessity for a policy
intervention such as this. Skills shortages impede national growth. Yet many companies have failed to invest in their
people over many years. Something had to be done.
The long-term effect of government action may be to
level the training playing field as those who previously
failed to invest in training now have an incentive to do so.
Businesses such as Bidvest Namibia that make
substantial training investments have long been
frustrated by the targeting of their trainees by other
companies. The non-trainers avoided the investment and
simply head-hunted promising candidates who had been
developed by industry competitors.
Hopefully, the training levy will result in a more responsible
approach to training by all private sector players.
UNDERSTANDING EMPLOYEES
Our people orientation is also showcased by ongoing
innovation within the HR function. For example, we
recently implemented a self-service HR system and
automated our personnel files. This will enable staff
members to retrieve their own information and update it.
Better information leads to better understanding of
employee needs.
For example, it emerged that more than half our people
have no medical aid. Affordability is a key constraint.
To assist those without medical insurance, we have
partnered with an NGO, the Mister Sister Mobile Health
Service. Mobile clinics from the service now regularly
visit our operations in Windhoek to provide basic health-
care to employees from low-income groups.
APPRECIATION
I thank the people of Bidvest Namibia and their managers
for their support and dedication in a challenging year.
Our margins came under pressure, so did our people.
But we continued to achieve top-line growth and made
solid progress in many areas. This was the result of hard
work and innovation. I appreciate the effort made by all
and congratulate the teams that achieved consistent
growth on a job well done.
I must also thank our chairman and our board of directors
for their guidance and strategic direction.
In addition, I extend our thanks to both customers and
suppliers. We increasingly work as partners to achieve
efficiencies and service improvements. Entrenching
these relationships is a strategic priority for Bidvest
Namibia.
GOING FORWARD
Our strategic objective remains sustained growth across
all components of the business. However, we should
acknowledge that the reduced direct quotas granted to
Namsov will have a material effect on overall results.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201421
We will energetically pursue all opportunities to achieve high levels of fleet utilisation. If appropriate, our fleet may
explore opportunities in new fishing grounds.
Cost pressures have to be addressed, however. This may necessitate the laying up of vessels and, early in the new
period, preliminary arrangements were made to lay up two vessels.
Bidfish will continue to examine opportunities for onshore processing. Efforts to expand and diversify its range will
also be prioritised. Prospects in Angola look promising and a positive contribution is expected from Pesca Fresca, our
Angolan joint venture, following the resolution of legal issues.
In recent months, policymakers in some African countries have begun to examine inland aquaculture as an appropriate
response to the food security challenge. This highlights the opportunity for a player such as Bidfish to explore the
potential for public-private partnerships. We remain vigilant for opportunities to engage with government in areas where
we can provide much needed expertise.
Product innovation and the exploration of new opportunities will be focus areas for all our businesses.
Bidcom will continue to expand its infrastructure while seeking operational efficiencies and organic growth. Manica’s
new bunkering services business was launched at the beginning of the period. Bunkering is a growth area and the new
operation will further diversify income streams.
Major investment in the mining industry creates growth opportunities for several Bidcom operations. The level of activity
in the oil and gas exploration sector seems to have reached a plateau. However, these activities will continue to create
opportunities for Freight and Logistics in particular.
At Food and Distribution, T&C has added to its brand bouquet and is well positioned for continued growth. Caterplus is
better resourced and better able to serve customers following the establishment of a national brand network. Continued
improvement in this business is a priority.
The integration of ProTrade, our non-food products distributor, did not proceed as expeditiously as initially hoped.
However, the inclusion of non-food lines in T&C’s FMCG offering enables the division to better serve customers and build
sales volumes. This establishes a base for strategic gains in the coming year.
Diversification of the business base at Bidvest Namibia remains a priority and opportunities for acquisitive growth
outside the fishing industry will be closely scrutinised. Our balance sheet remains strong and we will look for acquisitions
where we see value.
Sebby Kankondi
Chief executive
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201422
Bidvest Namibia Fisheries Holdings operational review
Namibia Fisheries
HIGHLIGHTS AND CHALLENGES
– Fishing operations contributed 45% of revenue and 81% of operating profit
– Benefits as a result of the weaker currency were offset by lower selling prices of horse-mackerel
– Depressed market returns of horse-mackerel had a negative effect on results
– Marine aquaculture continues to develop
– Strong performance on the pilchard and canning side
BIDVEST NAMIBIA FISHERIES
Bidvest Namibia Fisheries (Bidfish) comprises a number of dynamic subsidiaries that are
engaged in various sectors of the fishing industry in Namibia, offering a wide range of
products which include frozen horse-mackerel, monkfish, canned pilchards, other canned
products, fishmeal, fish oil and oysters. Bidfish also has shareholding in a company in
Angola, which is engaged in frozen and fresh sardinella, horse-mackerel, fishmeal and
fish oil.
All Bidfish companies own and operate their own vessels in the different sectors of
the industry as well as the shore-based operational premises which are well suited for
their needs.
Jan ArnoldManaging director of Bidvest Namibia Fisheries Holdings
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201423
BIDVEST NAMIBIA FISHERIES HOLDINGS (BIDFISH)
Three core operations – horse-mackerel fishing, pilchard fishing (and canning) and Angola-based small pelagic fishing
– faced contrasting trading conditions and market prospects.
Budgets were met or exceeded at all major operations, but expectations were tempered by a sober assessment of
challenging business conditions and the reality of rising costs in an environment where underlying volumes remain
stable and dramatic growth cannot be expected in the short to medium term.
Local and international developments contributed to sometimes turbulent market conditions. The portion of the total
allowable catch (TAC) available to Bidfish during the financial year remained in line with the previous year, while limits
were applied to fish imports in Nigeria and the DRC introduced a cap on some selling prices.
Pricing pressure was also evident as a result of upheavals in Ukraine and Russia. These countries are traditionally a
good market for affordable fish products from Europe and the north Atlantic. As east European demand fell away, these
products were sold into Africa at low prices.
Despite sometimes turbulent market conditions, Bidfish remains the preferred supplier in all markets in which it operates.
In response to heightened business risks, Bidfish innovated, sought new partners and investigated key changes to the
existing business model.
The business is being repositioned. It is being reinvented as a market-led business that adds value for its customers,
partners and the societies in which it operates.
Horse-mackerel operationsThe horse-mackerel business, Namsov Fishing Enterprises, maintained its position as one of Africa’s leading suppliers of
quality horse-mackerel. Its brands provide a trusted source of protein to 3 000 000 people in Africa every day.
Price regulations in the Democratic Republic of Congo and a general oversupply in our traditional market following
import restrictions implemented in Nigeria led to a significantly lower selling price for horse-mackerel in US dollar. The
weaker Namibia dollar offset the effect of lower prices in US dollar terms. Unfortunately, the weaker Namibia unit had
a significant impact on costs.
In addition, the cost-base was impacted by the rising cost of access to quotas. The business also had to absorb the
cost of investment in new initiatives and processes and costs entailed in the exploration of new business opportunities.
New initiativesTo address the challenge of rising costs, the business developed a new strategy to secure ongoing efficiencies through
new technology, new partnerships and new approaches to its market. The exploration of new fishing grounds also
received priority.
The business responded energetically when it was approached by the authorities in Gabon with a request that Namsov
assist in the exploration of the fishing grounds off its shores with the aim of developing their fishing industry. Fishing
operations in these waters have traditionally been limited to small-scale tuna fishing.
Initial indications suggested that the small pelagic resource off Gabon is sufficient to support commercial operations.
The relationship with Gabon was fostered by an existing Mauritian technical partner.
Unfortunately, the Gabon experiment did not yield favourable results.
Namsov has been and is still operating a fleet of five midwater trawl factory vessels. All catches are processed on board.
This includes all processes up to the storage of final product in freezer holds, ready to sell. A refrigerated seawater
(RSW) midwater trawling vessel was recently chartered at a cost of NAD10,5 million to assess the efficiencies of the
RSW catching method in our conditions. These RSW vessels are significantly different to our factory vessels in that the
catch is stored fresh in the RSW tanks until the fish are discharged ashore for further processing. No processing takes
place on board these vessels.
The purpose of this costly experiment was to test if the volume and quality delivered by such vessels were sufficient to
justify commercial processing on shore.
Namsov also stepped up its research and development programme. Product diversification is being investigated
along with new packaging and retail pack design. The aim is to develop products customised to appeal to consumer
preferences in specific national markets.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201424
Bidvest Namibia Fisheries Holdings operational review continued
Namibia Fisheries
The Tetelestai subsidiary continued to develop its open ocean oyster farm off Patrysberg. The previous lagoon-based
operation was subject to high mortality rates. However, the open ocean oyster farm has achieved higher growth rates
and invested in new lines at a cost of NAD5 million.
Experience in the Atlantic indicates that frequent line inspections are necessary to ensure acceptable oyster growth.
Operations are now supported by a purpose-built vessel commissioned at a cost of NAD10 million. Its deployment
enables regular inspection of the oyster lines.
Disappointments and challengesPolicy risk emerged as a key challenge, in the domestic Namibian market and in other African jurisdictions.
It remains government policy in Namibia to support new Namibian entrants to the fishing sector. Officials therefore
allocate fishing rights to new right holders, many of whom lack the capacity to exercise the right. These rights are
therefore on-sold to commercial operators who compete for access to the fish resource, resulting in higher access costs.
At the same time, the business is faced by much lower direct allocations from the Ministry of Fisheries and Marine
Resources. In 2014, the level was about 50% lower than the traditional allocation (before 2012) to Namsov.
Namsov’s response is to engage with policymakers while building relationships with new entrants. The Trachurus
structure is in place to enable collaboration with new rights holders. However, this joint-venture solution may not always
be appropriate for all newcomers to the industry. Namsov remains flexible and is ready to explore other mechanisms to
enable new rights holders to secure a commercial return on their allocations.
Policy implementation by other African states also had material impact on the business.
Nigeria has introduced import restrictions with the aim to reduce imported fish products by 25%. These restrictions are
intended to encourage local aquaculture and support the growth of local jobs.
Central and West Africa import approximately 2 000 000 tonnes of pelagic and associated fish a year. Nigeria accounts for
half the tonnage. The import restrictions means it now allows in only 750 000 tonnes of imports, with 250 000 tonnes
going to smaller markets in other West African countries, flooding those markets while creating price pressures.
Meanwhile, DRC has applied a cap to the selling price of the most popular sizes of fish, leading to considerable margin
pressure.
Namsov made contact with potential new partners and explored new downstream options that will enable the business
to serve its customers while respecting new policy provisions.
Though improvements were noted at the open ocean oyster farm, overall performance was disappointing.
Social engagementSocial engagement is driven by the Namsov Community Trust (NCT), a 10% shareholder in Namsov. Contributions are
primarily targeted at education, healthcare and the environment. In 2014, NAD13 million was invested in community-
based initiatives. Since inception, NAD62,9 million has been channelled to interventions that directly assist under-
resourced communities.
Safety, training and industrial relationsFishing on the high seas is an inherently hazardous business. However, Bidfish is proud to report zero fatalities during
the review period. Safety training is a priority and regular safety drills are compulsory on all vessels.
Good progress was made with the implementation of HACCP (the Hazard Analysis Critical Control Point system), a
process that identifies where food safety hazards may occur and institutes controls to prevent them happening.
By the end of 2014 it is planned that all five vessels in the Namsov fleet will be HACCP compliant.
Ongoing training supports the Namsov mission as only skilled people can deliver the quality promised by Namsov
brands. However, at a national policy level, additional considerations come into play.
Namibianisation of the workforce is a policy priority for government. Bidfish and Namsov embrace this goal. To ensure
that Namibian vessels are operated by Namibian officers, Namsov sponsors the training of 10 students at a Russian
naval academy. The aim is to ensure they obtain the same qualifications as their foreign counterparts.
The three-year officer training programme entails an investment of NAD3 million a year.
In addition, Namsov runs a cadet training programme. Seven cadets a year are inducted. They complete courses run by
the Namibian Fisheries Institute and similar institutions in South Africa.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201425
The progress of all staff members – from administrative grades to managerial roles – is guided by a personal development
plan. All training interventions are designed to equip every individual with the knowledge and skills necessary to ensure
career fulfilment. Training investment reached NAD4,3 million in 2014 in line with the Group pledge to earmark 2% of
payroll for skills development.
Staff turnover was minimal.
No strikes occurred. One worker petition was handed to management. It called for amendments to standard terms and
conditions in contracts of employment. In response, management will ensure effective communication on these issues
to make sure every employee is aware of the provisions in these contracts and what they entail.
Going forwardTrading conditions will remain challenging in the coming year. One of the keys to performance remains the TAC. The
industry TAC increased to 350 000 tonnes in the prior year and remained at this level in 2014. However, significantly
lower horse-mackerel quota allocations have been received by our fishing businesses over the past two years. The
impact of the second allocation for the 2014 calendar year was particularly significant. As a consequence of the latest
low quota allocation, and after our financial year-end, two of our fishing vessels were tied up and the crew sent home.
Management continued to engage with the relevant stakeholders and authorities. Namsov, together with legal counsel,
is considering, as a matter of urgency, what legal action to take.
The coming year will therefore be characterised by a quest for efficiency and the possible development of alternative
protein sources. Optimum fleet utilisation is a focus area for management.
Investigation of new fishing grounds will continue. At year-end, conversations were initiated with potential new partners
in Peru.
The viability of RSW trawling has been established. It is necessary to carry out feasibility studies before a decision can be
taken on whether or not to develop onshore facilities in Walvis Bay to process the catches harvested by the RSW system.
New technology will also be explored with the aim of securing long-term operational efficiencies.
Investment in the Tetelestai oyster farm will continue.
The Namibian and several other African governments are eager to promote the development of inland aquaculture.
Public-private partnerships in this area may move the process forward. Namsov will examine opportunities for
involvement in aquaculture PPPs in line with its strategic commitment to innovation and product development.
Pilchard operationsThe pilchard fishing and canning business, United Fishing Enterprises put in a strong performance. Pleasing progress
was achieved with the turnaround strategy put in place two years ago when new senior management was appointed.
The pilchard resource remains delicate, however.
The TAC was pegged at 25 000 tonnes in the prior period. This rose to 30 000 tonnes in 2014.
Commendable results were therefore achieved from a low base, with little prospect that allocations will move higher until
there is firm evidence that resource recovery is under way.
Gains were a function of operational efficiency and margin management. Trading profit moved 60% higher.
Pesca FrescaPerformance by Pesca Fresca was below budget over the review period, though prospects by year-end were encouraging.
Legal processes have prevented the Angola-based subsidiary from concentrating on its core activities – small pelagic
fishing and processing, mainly horse-mackerel and sardinella. There is a ready local market for Pesca Fresca’s frozen
and fresh fish. Export potential for its fishmeal and fish oil is also well established.
Legal matters are progressing with less impact on operations. However, a new case involving allegations of irregular
use of funds is still to commence. Provision has been made for legal costs and monies that might not be recovered.
By year-end, a vessel purpose-built to Angolan specifications had been deployed to Angola waters, setting the scene for
a rapid return to profitable operations.
In the coming year, the business has the potential to become a solid contributor to Bidfish profits.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201426
Bidvest Namibia Commercial Holdings operational review
COMMERCIAL HIGHLIGHTS
– Commercial operations contributed 55% of revenue and 18% of operating profit
– Stronger demand for freight, logistics, marine and support services by offshore oil and gas exploration companies
– Namibian bunkering company to supply oil and diesel to marine customers was established during 2014
– Stevedoring activities were impacted by cost pressures, leading to the downsizing of these operations
– New or enhanced infrastructure in food and distribution is reflecting pleasing results
– New confectionery and cosmetics ranges were added to the brand bouquet of the fast-moving consumer goods
– The development of effective talent retention mechanisms has become a key management challenge in all areas
– Legislation to protect Namibia’s poultry and dairy industry pushed up the price of these products and negatively impacts the perishables business
– Product range was expanded in most commercial products entities – Namibian economy continues to grow and major projects have been
launched – Opportunities for Commercial and Industrial Services to achieve
sustained growth
BIDVEST NAMIBIA COMMERCIAL HOLDINGS (Bidcom)Performance improved significantly as a result of tighter management focus, restructuring of key
businesses and the achievement of operational efficiencies.
Growth in the construction sector, government investment in infrastructure and the roll-out of major
projects, notably in the mining industry, created growth opportunities for many Bidcom operations.
These were vigorously pursued.
Namibia Commercial
Hans-Werner TimkeManaging director: Freight and Logistics
Quentin KingManaging director: Food and Distribution
Werner SchuckmannManaging director: Commercial and Industrial Services
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201427
FREIGHT AND LOGISTICS
The business put in a strong trading performance. Offshore oil and gas exploration by a growing number of international
companies contributed to stronger demand for the division’s freight, logistics, marine and support services. Significant
growth in revenue was achieved off the back of organic growth at existing businesses and expansion into new services.
For some time now, all offshore blocks have been allocated by government to licensees looking to exploit oil or gas
reserves. In a few cases, drilling has begun. Other licensees are gathering seismic data. The influx of foreign executives,
specialists and other personnel created opportunities to significantly expand the offering of Manica’s oil and gas services
division.
New initiativesManica successfully launched the Manica Business Centre to supply offices, office equipment and office support
services to foreign companies engaged in oil and gas exploration. It also started a sourcing and trading division to help
marine clients to obtain goods and services required for repairs or operations.
In addition, Freight and Logistics established a majority Namibia-owned bunkering company to supply oil and diesel to
marine customers. The Walvis Bay business creates Group-wide synergies as the Bidfish fleet also requires bunkering
facilities such as these.
Bunkering services are not only required by shipping lines, fishing vessels and those engaged in oil and gas exploration.
Some of the world’s richest marine diamond deposits are found off Namibia’s Atlantic coast and mining vessels are
also potential clients. The new business obtained a wholesale fuel licence and, after partnering with an internationally
experienced bunker company, began operations in July 2014.
Manica’s track-and-trace system went live and bedded in well. The primary focus is on improved customer service
within the clearing and forwarding business. Improved management information also fosters efficiency gains.
In addition, continued investment in materials handling assets further increased the asset-backed services offering and
the one-stop shop approach to customer service.
Freight and tradingFreight volumes moved substantially higher. One factor underpinning growth was the construction of a new acid plant
and associated infrastructure at the Tsumeb copper mine. Manica provided logistical support for this project and for the
new Husab uranium mine near Swakopmund.
Project development in the mining and energy sectors also underpinned robust trading volumes as Manica entrenched
its position as Namibia’s premier supplier of marine, mining, industrial and automotive lubricants.
Disappointments and challengesUnfortunately, stevedoring activities were impacted by cost pressures, leading to the downsizing of these operations.
Regrettably, 64 jobs were lost.
Industrial relations have become a key focus area. Double-digit wage increase demands have been made by the trade
unions, with little immediate prospect of similar increases in productivity. Worker protests have been staged at some
operations, but strike action has been avoided.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201428
Bidvest Namibia Commercial Holdings operational review continued
It has proved difficult to meet union expectations as negotiations reveal high levels of dissatisfaction – not so much with
working conditions, but with slow progress on national issues such as better living standards, better social delivery and
better education.
The emergence of breakaway unions not affiliated to the national umbrella body, NUMW, complicates the task of
effective engagement with the unions.
Historically, relations with the unions have been good. Rebuilding trust and more amicable trade union relations have
become priorities for management.
Lack of appropriate skills remains a key constraint. In response, the division stepped up its training investment.
The business remains a strong supporter of Namibia’s Commercial Advancement Training Scheme (CATS), the dual
education system that combines in-company apprenticeships with polytechnic courses.
The impact of major national projects was positive, but underlined a key business risk – the fact that future Manica
performance is partly dependent on securing a share of big infrastructure investments and other strategic projects in
the country.
Social engagementSport, health, education and the environment remain the focus areas of the division’s social investment. The business
commits 1,5% of after-tax profit to its social programmes.
Employees are also significant contributors to their communities via the Pandula Trust. This employee-driven initiative
targets areas of need at grass-roots level.
The business continues to partner with small business whenever possible and maintained its status with the
Namibian Preferential Procurement Council as an 82% contributor to black economic empowerment. Black economic
empowerment requirements have still not been legislated, but the division is committed to best practice and has thus
registered with the council.
Going forwardManagement is confident current momentum can be maintained, though some volatility in performance can be expected
in line with project activity. Major energy and mining projects typically have a lifespan of several years, indicating strong
potential for continued growth as the division has become a significant supplier to these initiatives.
Continued growth will be sought by investing in materials handling assets, enabling the business to offer more
comprehensive services across Manica-controlled cargo flows while expanding corridor services to neighbouring
countries. In addition, growth in the new sourcing and trading and business centre divisions should add momentum to
diversification efforts. People logistics has become a focus area.
Competition remains intense across marine and portside services. However, the downsizing of the stevedoring business
has created a more efficient, more competitive operation. Energetic steps will be taken to win back business now the
restructure is in its closing stages.
The strategy of widening the division’s base of business will continue. In recent years, the division has gained valuable
experience in the supply of services to the oil and gas exploration sector. With all offshore exploration blocks now
allocated to rightholders, this sector is positioned for significant expansion. Manica is well placed to grow with it.
FOOD AND DISTRIBUTION
Performance was pleasing, though lower than expectation, driven by the continued growth of Taeuber & Corssen’s (T&C)
core business (the warehousing, distribution, merchandising and sale of leading FMCG brands) and the successful
turnaround strategy at Caterplus, the national foodservice operator.
A contributor to growth was private sector investment in new or upgraded retail infrastructure in centres such as Katima
Mulilo, Grootfontein, Ondangwa, Ongwediva, Keetmanshoop and other growth points in the north of the country. The
Namibia expansion strategy of some South Africa-based quick-service restaurant brands also proved beneficial.
New initiativesThe Caterplus turnaround focused a great deal of management attention.
The strategy brings Caterplus closer to its customers. Previously, operations were centralised in Windhoek. During the
year, a chain of branches was established across the country. Distribution now takes place from strategic hubs in Walvis
Namibia Commercial
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201429
Bay, Ongwediva and Windhoek, with plans for a further operation in Grootfontein.
New infrastructure investment led to efficiencies and cost savings. Previously, a delivery vehicle might travel 1 200km
to 1 700km to deliver to customers and make a return trip empty. The new hub-and-spoke system has reduced delivery
time to 24 hours and increased vehicle utilisation efficiencies.
Customer satisfaction and retention levels are significantly higher. Caterplus is now positioned as the national logistics
partner of its customers, a key source of competitive advantage.
Foodservice and FMCGsThe division’s foodservice business refocused its product offering while widening the range. Value-added products
receive growing attention. Portion-controlled, ready-to-serve products cut preparation time, reduce waste and allow the
catering industry to offer higher-margin options to the end-consumer.
Certain additions to the Caterplus range also have the effect of de-skilling some kitchen operations – an important factor
for restaurants and catering businesses challenged by a shortage of skilled personnel.
Caterplus made significant market-share gains off the back of the new strategy.
T&C entrenched its position as Namibia’s leading distributor of quality brands and achieved strong like-for-like gains.
The business maintained its record as a brand custodian that nurtures long-term relationships. Its brand basket contains
products that have remained with T&C for generations, including the Beiersdorf, Nestlé, Unilever and Philip Morris ranges.
New confectionery and cosmetics ranges were added to the brand bouquet.
ProTrade Agencies, a business acquired in the prior period, was integrated into T&C without job losses. The sales force
was restructured and the T&C warehouse management system extended to ProTrade.
ProTrade focuses on small appliances, non-food categories and hardware. A good fit was achieved with T&C brands.
T&C’s IT system was rolled out across the entire division.
T&C’s property division was sold to Bidvest Namibia Properties. The Group measures operating performance separately
from property performance.
Disappointments and challengesPolicy risk was highlighted when government imposed restrictions on the quantity of dairy products that could be
imported. The restriction was successfully challenged in the High Court of Namibia, though government subsequently
took the matter to appeal. The issue may be before the courts for some time, but the border is currently open for the
import of dairy products.
In the prior period, legislation to protect Namibia’s poultry industry pushed up the price of these products, provoked
consumer resistance and prompted a switch to other forms of protein. This negatively impacts T&C’s perishables
business.
Some ProTrade Agencies, as well as one of the newly taken-on agencies at T&C, failed to generate sufficient returns. The
situation is currently being re-evaluated and existing terms will be renegotiated with principals.
The business again increased its training investment. It remains a source of frustration that people development is
neglected by many competitors. Those trained by the division are frequently targeted for recruitment by other companies,
making renewed training investment necessary.
The development of effective talent retention mechanisms has become a key management challenge.
Social engagementThe division maintained its commitment to community and social development through its support of the Namibia
Animal Rehabilitation Research and Education Centre, an organisation committed to the protection of the country’s
natural resources.
Going forwardSuccessful restructures and investment in strategic infrastructure create a platform for continued growth by a
reinvigorated division. Modern supermarkets have become a lifestyle destination for the Namibian middle class. The
demand for aspirational products is expected to rise, creating potential for significant expansion.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201430
Bidvest Namibia Commercial Holdings operational review continued
Additions to the perishables category are planned. New confectionery and healthcare lines will be added to the mix. A
shift to other segments of the FMCG market is also being considered.
International sources of supply to complement supplies from South Africa are being explored.
Major retail chains are opening new stores nationwide. This puts growing pressure on small retailers and affects our
customer mix. However, the net effect is positive as the growth of national retail brands contributes to volume growth
by our FMCG business.
For its part, Caterplus is well positioned to maintain good growth, bolstered by the full-year effects of its restructure and
recent investment in new infrastructure.
COMMERCIAL AND INDUSTRIAL SERVICES
Improved performance was registered in almost all areas as a result of positive business sentiment and new investment
by both the government and private sector. Consumer activity also revived following the development of new retail
centres.
An influx of business travellers – driven in part by the growing pace of work in the energy sector – was also positive.
All seven divisional operations benefited from closer collaboration with their South African counterparts.
WaltonsThe turnaround strategy at Waltons received focused management attention. Results were encouraging and the business
had a very good year, driven by an exceptional back-to-school season and the commitment of a new management team.
Higher volumes were assisted by significant investment in new stores and store refurbishment. The new face of Waltons
is now visible in Ondangwa, Oshikango, Rundu, Okahandja, Frans Indongo branch and Otiwarongo.
The broader national footprint became the platform for a strong sales effort. Pleasing growth was achieved in stationery
and furniture sales to commercial customers and some government departments.
Retail sales also showed promising year-on-year growth.
Particularly well received was the Waltons range of tablets, cellphones, hand-held devices and computer peripherals
such as printers. Closer cooperation with divisional colleagues at Kolok proved beneficial in these categories.
KolokThe supplier of computer consumables, peripherals and associated products had an exceptional year. The business
bounced back from an indifferent 2013 to regain lost market share. Its range of hand-held devices did particularly well
in a highly competitive marketplace.
A notable feature of the year was close collaboration with the Kolok business in South Africa on issues such as marketing
and pricing. One computer range was discontinued by the brand principals, but Kolok reacted energetically and secured
replacement volumes.
The strategic decision to devote greater attention to consumables proved well founded and pleasing volume increases
were achieved.
Skills shortages in technical and managerial areas remain a challenge. The business responded by stepping up in-house
training while tapping Group training resources.
Konica MinoltaDespite tough trading conditions, the team achieved good results. The business innovated by setting up an internal
funding instrument to support equipment sales to the corporate sector. The new system bedded in quickly and was well
received by customers.
Machine sales achieved good year-on-year growth. Copy volumes were also well up.
Konica Minolta’s ability to deal with policy risk was highlighted when government decided to give preferential treatment
to small and medium-sized business. This meant some equipment contracts were lost to SMEs. However, SME office
equipment suppliers emerged as an important customer group as they subsequently brought their business to the
industry leaders at Minolta.
Namibia Commercial
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201431
A new branch opened at Ongwediva to serve a growing customer base in what is becoming an important centre in the
north of the country.
Rennies TravelThe business put in a pleasing performance despite continued pressure in the corporate travel sector. Many businesses
have cut back on executive travel, opting for video and teleconferencing when possible.
Rennies Travel responded by stepping up service levels and entrenching relationships with its customers. Continued
consultant training was another priority.
Good volume growth was achieved, underpinned by business travel associated with major mining developments and oil
and gas exploration. A significant new account gain was registered when Rennies won the executive travel business of
the Husab uranium mine.
During the year, a new branch opened in Ongwediva.
Cecil NurseThe furniture business and its Windhoek factory achieved good growth. The company leveraged its position as a well-
established brand with experienced management and a highly cohesive team. A new-look catalogue was well received,
as was the introduction of several new ranges.
New office blocks are being built in many commercial and retail centres. Cecil Nurse maximised the opportunity and
secured several contracts. A major order was won from the University of Namibia. Major tender successes were also
achieved in the private sector.
Just before year-end, an expansion programme began at the factory. Completion is expected by December.
SteinerThe corporate hygiene services business was launched two years ago, but failed to gain traction. At the beginning of the
previous calendar year, new management was appointed and earlier in 2014 operations at Walvis Bay were downscaled.
Most functions have been centralised at Steiner’s Windhoek premises.
By year-end, the business was close to break-even point.
The turnaround has been driven by stepped-up staff training and a concerted effort at market education. The customer
base has been growing steadily. Support from Steiner South Africa assisted the recovery process.
The Steiner offering will widen early in the new period when pest control will be added to the mix of services.
VoltexPerformance at the electrical supplies and cable business was disappointing and a loss was recorded. Remedial action
is being taken. Regrettably, five retrenchments were necessary as efforts were made to refocus the business.
Construction activity is picking up in several parts of the country and efforts are being made to capitalise on the
opportunity by getting close to customers.
Closer synergy with Bidvest Electrical South Africa will help to ensure better focus on customer needs.
The Oshakati agency has been converted into a branch.
Going forwardThe division has gained considerable momentum over the last year. Operational challenges have been addressed,
paving the way for continued gains. Management is strongly focused on sales, marketing and efficiencies.
The Namibian economy continues to grow and major projects have been launched. This creates opportunities for
Commercial and Industrial Services to achieve sustained growth.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201432
Financial director’s review
– Revenue up by 12,4% to NAD3,7 billion
– Operating profit down by 16,4% to NAD501,0 million
– Fishing remains a strong contributor despite the significant drop in profit
– Manica benefits from oil and gas industry exploration
– Commercial and Industrial Services showed strong revenue and operating profit growth
– Dividends down by 8,7% to 63,0 cents per share
ECONOMIC AND TRADING ENVIRONMENT
The Namibian economy’s real GDP growth declined from 6,7% during 2012 to 4,4% in 2013. The main factor
contributing to the slowdown in growth relates to a significant contraction in the agriculture sector, as a result of the
drought. Namibia’s growth prospects for 2015 are more promising with forecast real GDP growth expected to reach
around 5%.
The Namibia dollar weakened by 16,5% from an average rate of NAD8,86 per US dollar to an average rate of
NAD10,32 per US dollar in our 2014 year.
FINANCIAL PERFORMANCE
Revenue increased by 12,4% from NAD3,3 billion in 2013 to NAD3,7 billion in 2014 due to strong revenue growth in
the Commercial businesses.
Operating profit decreased by 16,4% from NAD599,1 million to NAD501,0 million. Bidvest Namibia’s trading margin
decreased from 18,2% to 13,5%.
The Bidfish operating profit fell by 23,0% to NAD406,6 million. Price regulations in the Democratic Republic of Congo
and a general oversupply in our traditional markets following importation restrictions implemented in Nigeria, led to an
18,6% average lower realised selling price in US dollar for horse-mackerel. The weaker Namibia dollar offset the lower
US dollar price effect on revenue, but also had a significant impact on costs. Gross profit was influenced by increased
costs in securing outside quotas due to lower direct quota allocation. Quota rental fees amounted to NAD245,8 million
for the year. Horse-mackerel forms the majority of Bidfish’s business.
Legal processes have prevented Pesca Fresca, our Angola-based subsidiary from concentrating on its core activities
and therefore it did not contribute profit for the 2014 financial year. Legal matters are progressing with less impact on
operations. However, a new case involving allegations of irregular use of funds is still to commence. Provision has been
made for legal and other costs.
The pilchard operations showed strong results and a significant improvement on the previous financial year.
The Freight and logistics division’s operating profit increased by 19,1% to NAD43,6 million. Offshore oil and gas
exploration by a growing number of international companies contributed to stronger demand for the division’s freight,
logistics, marine and support services. Significant growth in revenue was achieved off the back of organic growth at
existing businesses and expansion into new services. The division’s direct expenditure and cost of revenue increased in
line with revenue, while operating expenditure remained well controlled.
The Commercial and Industrial Services division’s
(Services and Industrial and Commercial Products in
segment report) operating profit increased by 21,8%
to NAD23,9 million due to strong turnover growth. All
entities in this division performed well, except Voltex,
which is now starting to show signs of a turnaround.
The Food and Distribution division generated
NAD24,6 million operating profit, compared to
NAD21,2 million (excluding NAD7,2 million T&C
Properties profit) in 2013 (16,0% increase).
T&C Properties Namibia (Pty) Ltd was sold to Bidvest
Namibia Properties Holdings (Pty) Ltd with effect
1 July 2013 and is therefore shown as part of Corporate
Services’ results in 2014. The growth in profit can mainly
be attributed due to a turnaround of Caterplus. Import
restrictions on both dairy and poultry products negatively
affected T&C’s business. ProTrade Agencies (acquired
March 1 2013) has contributed well to revenue. The
anticipated synergies and efficiencies between T&C and
ProTrade have not been realised yet, and are receiving
focused management attention.
STATEMENT OF FINANCIAL POSITION AND
RETURN ON FUNDS EMPLOYED
Bidvest Namibia’s statement of financial position remains
strong and the company has sufficient cash resources
for potential acquisitions and other investments. There
is no long-term debt.
Property, plant and equipment purchases amounted to
NAD82,3 million. Manica invested in plant and equipment
and vehicles due to a new material handling division.
Replacement capital expenditure was maintained.
HIGHLIGHTS
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201433
Net working capital increased by NAD143,5 million. Most of the increase is attributable to timing differences or growth
in business. Provisions for doubtful debtors and obsolete stock are adequate. Debtors’ controls improved overall. The
incidence of accounts outstanding for more than 60 days fell from 7,2% to 6,1%. However, areas for improvement were
identified in some businesses.
Return on funds employed decreased from 53,8% to 39,0% due to lower trading profit and increased funds employed.
The Group remains focused on cost control, working capital management and generating acceptable returns on funds
employed. Significant focus is being directed at those operations where performance is below expected levels.
BUSINESS RISKS
Our fishing operations remain the dominant profit contributor to Bidvest Namibia. Access to sufficient direct fishing quota
therefore is a key driver. Fishing resources are well managed in Namibia and the resource remains strong. Bidfish’s
strategy for retaining access to sufficient quotas is to comply with all ministerial requirements and provide structures to
accommodate new right holders. These structures give new right holders an equity stake in the joint venture.
We are still actively pursuing acquisition opportunities to balance the contributions of our fishing and commercial
businesses, however further acquisitions in the fishing industry cannot be discounted.
Currency risk is an integral part of operating a business with international exposure. We ensure that assets and liabilities
in foreign currency are matched, thereby balancing such exposure.
At an operational level, credit risk remains acute. Our debtors remain well managed. However, continued vigilance is
required.
We also address risk by ensuring our business model remains fit for purpose. Organisational structures are uncluttered
and expenses well controlled.
Bidvest Namibia’s decentralised and entrepreneurial business model continues to prove itself. Our head office structures
remain lean. We are a big business, but we have an entrepreneurial and small business culture.
SUSTAINABILITY
Bidvest Namibia has always been committed to sustainable business practices and since inception has behaved with a
sense of responsibility to the community, the environment and our people.
In the 2014 financial year, Bidvest Namibia significantly strengthened its CSI contribution. CSI spend increased from
NAD20,1 million to NAD26,2 million (including outlays by the Namsov Community Trust).
We are a responsible corporate citizen and emphasise
the need for accountability, fairness and transparency in
our dealings with all stakeholders. In our view, strategy,
sustainability and risk are inseparable.
FUTURE
Trading conditions will remain challenging in the fishing
business in the coming year. Significantly lower direct
horse-mackerel allocations have been received by
the Bidvest Namibian fishing businesses during the
second quota allocation for the 2014 calendar year.
Since our financial year-end, two of the Group’s fishing
vessels were tied up and crews have been sent home.
Management is engaging with the Minister of Fisheries
and Marine Resources to resolve the allocation of quotas.
Prospects for the pilchard operations and Angolan
businesses are promising.
Strong results are expected from the commercial entities
due to further project activity in Namibia and turnaround
strategies are starting to show results.
Management continues to pursue acquisition
opportunities to bring balance to our portfolio by securing
exposure to a broader range of industries.
Theresa Weitz
Financial director
Operating profit
NAD’million
57876
52870
40694
1312 14
Fishing
Commercial and Corporate
0
100
200
300
400
500
600
700
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
Revenue
NAD’million
1 489
612
2413872
1 662
1 220
393
412
16
1 590
1 027
3485
325
1312 14
Fishing
Food and distribution
Freight and logistics
Commercial and industrial
Corporate
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201434
Corporate governance
PHILOSOPHY
Bidvest Namibia is committed to the highest level of ethics, integrity and corporate governance and, in alignment with
our South Africa-based parent, embraces the principles established in South Africa’s King III Report.
Our directors regard good corporate governance as pivotal to delivering sustainable growth in the interest of all
stakeholders. The board considers corporate governance vitally important to the success of our business and is
unreservedly committed to applying the principles necessary to ensure that good governance is practised.
Corporate governance, which is ultimately the responsibility of the board and its committees, ensures that we conduct
business in a responsible, ethical and transparent manner. Senior management assists to instil a culture of compliance
through the accountable and transparent operation of our structures and systems.
Companies within the Bidvest Namibia Group operate in a decentralised and incentivised environment in accordance
with our corporate governance policy through adoption and implementation of Bidvest Namibia’s policies, processes and
procedures, with a view to maintain sustainable economic, social and environmental performance in the interest of all
stakeholders at every level through the industries in which they operate.
CODE OF ETHICS
The Company’s core values of accountability, communication and excellence are driven through a code of ethics
applicable to all employees throughout the Group, which is adopted annually. Employees strive to behave ethically and
honestly under the leadership of the Bidvest Namibia executive committee and board of directors. The code sets out
our business principles and provides guidance to employees on how to apply them. Bidvest Namibia acts with honesty,
transparency, fairness, responsibility and professional integrity in its dealings with employees, shareholders, customers,
suppliers and society at large.
A fraud hotline through an independent third party enables employees to report any perceived irregular or unethical
behaviour in a confidential manner. Any irregularities are reported to the audit committee.
GROUP BOARD OF DIRECTORS
Procedures for appointments to the board of directors are transparent and handled by a nomination committee consisting
of CEO, Sebulon Kankondi and non-executive directors, Piet Steyn and Konrad Taeuber. All directors are subject to
retirement by rotation and re-election by shareholders with a third of the directors rotating annually in accordance with
the Articles of Association, ensuring an appropriate continuity of expertise and experience.
Board composition reflects a balance of executive and non-executive directors. A majority of non-executive directors is
independent. The board currently comprises nine non-executive and three executive directors. Birgit Eimbeck, Lindsay
Ralphs and Frans Kapofi were appointed to the board on March 3 2014 and Lindsay Ralphs was appointed as non-
executive chairperson of the board. Konrad Taeuber resigned effective August 22 2014.
The board is governed by a board charter which sets out the roles and responsibilities of the board. The board is
responsible and accountable for providing effective and ethical leadership which includes the addressing of material
and strategic issues, directing the strategy and operations of the Group to ensure the building of a sustainable
business, monitoring regulatory compliance and codes of best practice, ensuring the communication of adequate and
timely information to stakeholders, securing new acquisitions, monitoring operational and investment performance,
empowerment of executive management, risk management and IT governance, and promoting good corporate
governance within Group subsidiaries.
Effectiveness of the board of directors is conducted every two years through internal evaluation and development of
directors and induction of new directors is conducted informally.
DIRECTORS DEALING IN SECURITIES POLICY AND DECLARATIONS OF INTEREST
The directors trading in shares policy was adopted in line with NSX Listings Requirements to govern dealings by our
directors in the securities of Bidvest Namibia and other listed investment securities in which Bidvest Namibia has a
material beneficial interest. Any Bidvest Namibia share transactions entered into by the directors require the prior
approval of the CEO and are notified on SENS.
Directors’ declarations of interests are disclosed at the quarterly board meetings and updated as and when required.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201435
BOARD OF DIRECTORS MEETINGS ATTENDANCE REGISTER
BOARD
AUDIT
COMMITTEE RISK COMMITTEE
REMUNERATION
COMMITTEE
EXECUTIVE
COMMITTEE
AUG NOV FEB MAY AUG NOV FEB MAY AUG NOV FEB MAY JULY AUG JULY AUG OCT JAN MAR APRIL JUNE
Jan Arnold A A A A – – X
David E Cleasby* X – – – – – – – – – – –
Birgit Eimbeck * – – – – – – – – – – – – – – – – – – – –
Brian Joffe* X – – – – – – – – – – – – – – – – –
Sebulon I Kankondi A A A X A A
Frans Kapofi* – – – – – – – – – – – – – – – – – – – –
Quentin King – – – – – – – – X
Theofelus Mberirua – – – – – – – – – – – – X
Martina Mokgatle-
Aukhumes* – – – – – – – – – – – – – – – – –
Hans H Müseler* – – – – – – –
Lindsay Ralphs* – – – – – – – – – – – – – – – – – – –
Werner Schuckmann – – – – A A A A – – X
Pieter C Steyn* A A A A A A A A A A – – – – – – –
Martin K Shipanga* – – – – – – – – –
Konrad E Taeuber* X – – A – – – – – – – – – – – – – –
Hans-Werner Timke – – – – A A A A – – X
Theresa Weitz A A A A A A
*Non-executive director A: In attendance (not appointed to committee) X: Apologies –: Not member : Attended as director/member
BOARD COMMITTEES
A wide array of structures, guidelines and auditing, accounting and financial controls support rigorous corporate governance in addition to our code of ethics, authority matrix, corporate
values and transparent stakeholder communication. Structures to assist the board in discharging its duties include audit, risk, executive, remuneration, nomination and acquisition
committees. All committees excluding the executive committee are chaired by non-executive directors. Group board, risk and audit and divisional board meetings of all operating
entities are held quarterly.
Each committee operates under a formal charter that defines its powers and duties which are approved by the board.
AUDIT COMMITTEE
This committee consists of three non-executive directors. Meetings are held quarterly, attended by executive committee members, senior management and internal and external
auditors.
An audit committee charter mandates members to ensure effective and appropriate internal financial and operational controls on behalf of the board.
The committee assists the board in terms of the financial reporting processes, internal controls, risk management, compliance with legislation and the internal and external audit
processes.
The audit committee provides effective communication between directors, management and internal and external auditors, reviews accounting policies and financial information issued
to the public and recommends the appointment of external auditors.
The chairman reports quarterly to the board of directors.
The audit committee is assessed annually through a self-assessment.
Members include Harald Müseler (chairman), David Cleasby and Martin Shipanga.
RISK COMMITTEE
The risk committee is governed by a charter and identifies and analyses the associated risks of the businesses and reports findings and proposed mitigating steps to the audit
committee. Risks are managed at operational level.
The effectiveness of the risk management system is performed on an annual basis by the Group internal audit function.
Meetings are held quarterly. Members are mandated to apply the combined assurance model Group-wide, thereby ensuring a coordinated approach to all assurance activities.
The chairman reports quarterly to the board of directors.
Members include two non-executive directors, Martin Shipanga (chairman) and Harald Müseler, and executives Sebulon Kankondi, Jan Arnold, Quentin King, Theofelus Mberirua,
Werner Schuckmann, Hans-Werner Timke and Theresa Weitz.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201436
Corporate governance continued
REMUNERATION COMMITTEE
This committee, consisting of two non-executive directors, meets at least twice a year and reviews and approves the
remuneration and terms of employment of executive directors and senior employees of Bidvest Namibia. The committee
establishes remuneration principles, incentive scheme policies and recommends emolument structures and levels to
the chairman for his consideration and approval.
The Bidvest Namibia Incentive Scheme was adopted and implemented at the annual general meeting in November
2012.
Members include David Cleasby and Harald Müseler. Meetings are attended by CEO Sebulon Kankondi, financial
director Theresa Weitz and Piet Steyn.
EXECUTIVE COMMITTEE
The committee, under the chairmanship of CEO, Sebulon Kankondi, meets regularly, usually once a month. The
executive committee is mandated and responsible for implementing the strategies approved by the Bidvest Namibia
board of directors and for managing the day-to-day affairs of the Group.
Members include Jan Arnold, Quentin King, Theofelus Mberirua, Werner Schuckmann, Hans-Werner Timke and
Theresa Weitz.
ACQUISITION COMMITTEE
Any major acquisitions are referred to this committee for an in-principle decision on whether the acquisition should be
investigated and pursued and meetings are scheduled as required. Depending on their magnitude, acquisitions are
sanctioned by the executive committee and submitted to the board of directors for approval.
Members include Brian Joffe, David Cleasby and members of the executive team.
THE NAMCODE
Since it was first published in 1994, the King Report on Corporate Governance for South Africa and its successors,
King II and King III, have become an indispensable guide on corporate governance to directors and regulators in various
jurisdictions.
The NamCode is based on King III and provides guidance to all Namibian corporate entities on various governance-
related aspects, including:
– Ethical leadership and corporate citizenship;
– Boards and directors;
– Audit committees;
– Governance of risk;
– Governance of information technology;
– Compliance with laws, codes, rules and standards;
– Internal audit;
– Governing stakeholder relationships; and
– Integrated reporting and disclosure.
There is no statutory obligation on companies to comply with the NamCode which was drafted by the Namibian Stock
Exchange and is of particular relevance to listed entities. The underlying intention of the NamCode is not to force
companies to comply with recommended practice, but since the directors are accountable to shareholders and other
stakeholders, and where directors opt not to implement the recommended practices as set out in the NamCode, they
should be able to explain their reasoning and motivation to the shareholders.
The NamCode will be effective for financial years commencing after January 1 2014.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201437
Group value added statement
Employees
Dividends to shareholders and
non-controlling interest
Finance cost on borrowings
Central and local government
Re-invested in operations
435 779
201 3012 187 841
375 752
551
244
188
174
484
197
216
304
2
2014 2013
2014 2013
Notes NAD NAD
Revenue 3 703 495 3 294 235
Paid to suppliers for materials and services (2 574 263) (2 120 481)
Value added 1 129 232 1 173 754
Income from investments 29 639 28 323
Total wealth created 1 158 871 1 202 077
Wealth distribution
Salaries, wages and other employment costs 1 550 960 483 638
Providers of capital
Dividends to shareholders 148 367 133 530
Dividends to non-controlling interest 95 832 63 557
Finance cost on borrowings 2 268 1 782
Central and local government 2 187 543 215 641
Total distributions 984 970 898 148
Reinvested in the Group to maintain and develop operations: 173 901 303 929
Amortisation and depreciation 67 266 81 050
Deferred taxation 7 092 (6 539)
Undistributed profit for the year attributable to owners of the parent 97 378 141 066
Undistributed income attributable to non-controlling interest 2 165 88 352
Total wealth distributed 1 158 871 1 202 077
NOTES TO THE VALUE ADDED STATEMENT
1. SALARIES, WAGES AND OTHER EMPLOYMENT COSTS
Salaries, wages, overtime payments, commissions, bonuses and allowances 505 145 440 561
Employer contributions 45 815 43 077
550 960 483 638
2. CENTRAL AND LOCAL GOVERNMENTS
Current normal company taxation 166 438 195 035
Quota levies and royalty fees 19 919 19 587
Rates and taxes paid on properties 1 186 1 019
187 543 215 641
3. ADDITIONAL AMOUNTS COLLECTED ON BEHALF OF CENTRAL AND LOCAL GOVERNMENT
Value added tax collected on revenue 406 296 348 393
Customs and excise duties 58 596 41 918
Pay-as-you-earn deducted from remuneration paid 54 012 62 856
Non-resident shareholders’ tax deducted from dividends paid 4 382 3 959
523 286 457 126
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201438
Consolidated segmental analysis
The segment information for the reportable segments for the year ended June 30 2014 is as follows:
SEGMENTAL REPORTING
Total
Corporate
Services Fishing
Freight and
Logistics Services
Industrial and
Commercial
Products
Food and
Distribution
NAD’000 NAD’000 NAD’000 NAD’000 NAD’000 NAD’000 NAD’000
June 30 2014
Total segment revenue 3 801 033 50 108 1 664 407 413 294 64 590 388 584 1 220 050
Inter-segment revenue (97 538) (34 091) (2 224) (20 120) (4 853) (36 233) (17)
Revenue from external customers 3 703 495 16 017 1 662 183 393 174 59 737 352 351 1 220 033
EBITDA 568 240 5 838 452 494 49 440 11 972 15 795 32 701
Depreciation on property, plant and equipment (60 145) (3 519) (40 382) (5 582) (1 615) (1 784) (7 263)
Amortisation and impairment of intangibles (7 121) (184) (5 465) (212) (62) (387) (811)
Operating profit 500 974 2 135 406 647 43 646 10 295 13 624 24 627
Finance income 18 566 810 14 982 654 1 054 664 402
Finance costs (2 268) (141) (446) (631) (502) (8) (540)
Profit before tax 517 272 2 804 421 183 43 669 10 847 14 280 24 489
Total assets (excluding current and
deferred taxation) 2 752 509 419 904 1 549 444 247 321 86 711 129 095 320 034
Total assets include:
Additions to non-current assets, goodwill and
intangible assets 83 736 3 768 43 285 16 515 4 350 4 456 11 362
Total liabilities (excluding current and
deferred taxation) 479 210 4 363 132 459 122 244 52 458 58 145 109 541
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201439
The segment information for the reportable segments for the year ended June 30 2013 is as follows:
SEGMENTAL REPORTING
Total
Corporate
Services Fishing
Freight and
Logistics Services
Industrial and
Commercial
Products
Food and
Distribution
NAD’000 NAD’000 NAD’000 NAD’000 NAD’000 NAD’000 NAD’000
June 30 2013
Total segment revenue 3 380 813 28 267 1 591 265 342 395 59 910 323 106 1 035 870
Inter-segment revenue (86 578) (23 151) (1 815) (17 232) (7 488) (27 798) (9 094)
Revenue from external customers 3 294 235 5 116 1 589 450 325 163 52 422 295 308 1 026 776
EBITDA 680 147 (12 139) 580 215 41 517 20 781 13 667 36 106
Depreciation on property, plant and equipment (64 109) (1 819) (46 708) (4 808) (1 936) (1 639) (7 199)
Depreciation vehicle rental fleet (10 833) – – – (10 833) – –
Amortisation of intangibles (6 108) (171) (5 010) (67) (60) (337) (463)
Operating profit/(loss) 599 097 (14 129) 528 497 36 642 7 952 11 691 28 444
Finance income 17 472 556 14 556 236 573 524 1 027
Finance costs (1 782) 1 870 (652) (644) (988) (327) (1 041)
Profit/(loss) before tax 614 787 (11 703) 542 401 36 234 7 537 11 888 28 430
Total assets (excluding current and
deferred taxation) 2 769 605 496 768 1 529 681 219 882 180 623 113 881 228 770
Total assets include:
Additions to non-current assets, goodwill and
intangible assets 141 571 4 816 72 369 22 153 2 572 5 130 34 531
Total liabilities (excluding current and
deferred taxation) 597 685 (26 310) 177 838 104 312 138 069 49 129 154 647
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201440
Sustainability at Bidvest Namibia
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201441
GOVERNANCE OF SUSTAINABILITY
Bidvest Namibia embraces its obligation as a corporate citizen towards the society within which it operates, as well as
towards its shareholders, employees, stakeholders and environment while striving to build and sustain its corporate
reputation and conditions conducive to profitable business. The Bidvest Namibia executive committee and board of
directors view sustainable business practices as a business imperative and strongly support these initiatives.
In accordance with our decentralised business ethos, sustainability initiatives are managed by each business unit. Each
business has appointed a sustainability champion who helps drive numerous initiatives, including the recycling and
collection of paper, plastics and ink cartridges. Namsov Fishing has also set up an innovations committee that enables
employees to present innovative business ideas to management. “Going green” is one category in which employees
may submit suggestions.
As far as possible, sustainability initiatives are structured for maximum social and business benefit while delivering
sustainable value.
Businesses use an online data collation tool to maintain, collate and capture sustainability information. This information
helps businesses identify areas of focus and assists in target-setting and industry benchmarking. Refinement to this tool
now allows it to collect more meaningful sustainability data.
STAKEHOLDERS
For an organisation as diverse and decentralised as Bidvest Namibia, it is a constant challenge to determine which
operational issues should be considered material at business unit or Group level. Ongoing stakeholder discussions help
resolve this issue.
Stakeholder engagement occurs at Group, divisional and business unit level. A business engages with stakeholders
considered material to its business. Relationships with stakeholders in more than one business unit are addressed at
divisional and Group level to ensure stakeholder contact is appropriately coordinated.
Customers demand competitive prices, but increasingly focus on good environmental business practice. We
communicate with customers to highlight the benefit of doing business with a socially responsible supplier.
Close liaison is maintained with the Ministry of Fisheries and Marine Resources as policy on the total allowable
catch (TAC) and fishing quotas are material to our business. Divisional executives are represented on fishing industry
committees that advise government and are active at forums set up by the Chamber of Commerce and Industry.
Various forms of stakeholder communication are used, including SENS announcements, half-yearly presentations to
shareholders, analysts and the business media, press releases, profiles, articles in industry and national directories,
newsletters to staff and customers and one-on-one interaction with community groups.
ENVIRONMENT
Proper environmental practice is crucial to the proper commercial management of our business. Our fishing operations
are dependent on effective long-term fish biomass management. What is more, efficient use of fuel and energy and
responsible waste management practices help contain costs within our fishing, distribution and commercial operations.
Similarly, the proper monitoring and control of cold storage systems and airconditioning are critical to the performance
of our food and commercial businesses. Food safety is a strategic priority for our food and foodservice businesses.
Fishing resourcesOur fishing businesses remain a key contributor to the food security of many African states. According to a 2014
estimate by Bidfish, our fishing fleets provide affordable protein to 3 million Africans a day. Management of fish
resources is therefore a priority for Bidvest Namibia and the Namibian authorities.
We remain committed to diligent management of fish biomass and continue to collaborate closely with the Ministry of
Fisheries and Marine Resources. The ministry’s scientists collect data from our vessels. Every year, this research helps
determine the total allowable catch (TAC) determined by the Ministry of Fisheries and its advisory committee, whose
membership includes senior Namsov executives.
The assurance of sufficient TACs for horse-mackerel, pilchard and monk fish is critical to the long-term sustainability
of Namsov operations.
In 2014, the horse-mackerel TAC was set at 350 000mt (up from 320 000mt), an indication that management
practices are effective and a degree of resource recovery is underway. The pilchard TAC was maintained at 25 000mt.
The allocation came down from 31 000mt in 2012. Maintenance at the 2013 level is a signal that this resource
remains fragile.
The TAC determines the available resource for the annual quotas that are awarded by the ministry to Namsov and other
rightholders.
The challenge facing Namsov is to ensure a high level
of fleet utilisation in a policy environment in which its
direct rights may be limited. This means additional rights
have to be purchased from smaller operators, pushing
up access costs.
Some smaller operators wish to retain their rights and
are keen to participate in the industry, but lack the
capital needed for investment in vessels and equipment.
In response, Namsov several years ago created the
Trachurus joint venture (JV) and sold two midwater
trawlers to the JV.
The Trachurus structure enables Namsov, to provide
resources and other support to community-based
operators. They can then take up their full quota and
realise a commercial return.
The end-product is marketed by Namsov, a significant
benefit to JV participants as Namsov processes ensure
high product quality while its brands fetch competitive
market prices.
During the review period, it became apparent that the
Trachurus mechanism was not always suitable for every
new industry entrant. Namsov responded by considering
alternatives that would still permit prospective partners
to achieve commercial returns while enabling higher
levels of fleet utilisation.
Though access costs rose significantly; by year-end
vessel utilisation levels topped 90%.
All our catches are closely monitored by the authorities to
ensure they are within the TAC.
Our commitment to sustainable fishing practices
is further indicated by strong focus on by-catch
reduction. Our onboard controls exceed minimum legal
requirements. As a result, our fishmeal production again
accounted for less than 5% of total wet landings.
By-catch is less than 1% of total catches – testimony
to diligent management by our vessel captains and the
skill of our crews.
Rigorous observance of gear restrictions ensures the
harvesting of juveniles is kept to a minimum while
the fishing methods employed by our midwater trawlers
minimise damage to coral and the seabed.
Compliance with dumping and wastage guidelines
is assured as these issues are controlled by ministry
observers who accompany our vessels. Official scrutiny
continues onshore where observers confirm landed and
transhipment volumes.
Bidfish behaves responsibly and is an active partner
in the work of biomass management. However, new
challenges have arisen as a result of declining resources
in other fishing grounds. Other fleets increasingly enter
Namibian waters. Large foreign fleets do not always feel
obligated to adopt the stringent measures that have
become standard practice at Bidfish.
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Annual Integrated Report 201442
Sustainability at Bidvest Namibia continued
Other environmental factorsWaste managementAn overarching objective at all businesses is the creation of a culture of environmental awareness and responsible,
eco-friendly behaviour. Our employees buy into this vision and help achieve savings by recycling and reducing the use
of materials.
Rules and procedures govern the responsible treatment of waste material while vessels are at sea. Back in port, waste
is stored prior to recycling.
Sustainability champions – active in every business – are tasked with reducing the usage of material while ensuring
used paper, plastics and ink cartridges are collected for recycling.
Water consumptionNamibia is water-stressed and Namibians are well aware of the need to conserve water.
Bidfish operations account for most usage as water is used by the fleet to prepare catches for market. The pilchard
canning factory in Walvis Bay is also a big water user.
Responsible usage is built into standard operating practice on all vessels as they generate fresh water from sea water.
However, fresh water is purchased when in port.
Water production per vessel per day averages 28 tonnes. However, the fleet’s largest vessel, the Jupiter, produces
45 tonnes. To cut land-based water consumption, UFE’s pilchard factory uses sea water in some flushing operations.
FuelGasoline usage was down from 658 822 litres to 346 120 litres. Diesel consumption increased from 35,8 million litres
to 36,0 million litres.
Fuel is a major component of the Bidcom cost base as long distances have to be travelled by T&C and Caterplus.
The creation of new distribution hubs for Caterplus is intended to ensure better fuel efficiency while achieving greater
delivery frequency.
Interventions to ensure fuel efficiency include a strong focus on route planning, regular vehicle fleet maintenance,
regular replacement of vehicles with modern, fuel-efficient models, use of vehicle tracking systems and the installation
of systems to monitor driving technique and check fuel consumption.
The fishing fleet consumes most diesel.
Namsov’s horse-mackerel fleet has for some time been testing Xbee, a biotechnological and natural additive. The
suppliers are confident it can reduce pollution and CO2 while saving fuel. Claims are difficult to verify as variable weather
and sea conditions make it difficult to compare the relative performance of vessels using Xbee and those that do not
use the additive.
Xbee first went on trial on the Venus in 2011. During scheduled maintenance on the Venus in September 2013 attempts
were made to ascertain the comparative effectiveness of the product. Some indications were positive, but it was difficult
to reach definitive conclusions. Only after a prolonged period of comparative testing will verification be possible. Tests
continue. The search for fuel efficiency is continuous.
Air-purging of onboard refrigeration plants helps to cut electricity and fuel use. When appropriate, engines are run at
90% capacity to make sure oil is not burned off.
Energy managementWhen designing new premises or relocating, energy efficiency is a critical consideration. Our businesses increasingly
migrate to energy-efficient lighting and airconditioning.
In 2014, electricity usage reduced from 9,5 million kWh to 9,0 million kWh.
Voltex and Minolco market energy-efficient solutions and businesses across the Group are encouraged to set an
example by upgrading to these products.
Efficient cold storage is critical to our Food and Distribution operations. T&C’s Windhoek cold storage plant – the largest
in its distribution network – is ammonia-based. This is both energy efficient and environmentally friendly. Other plants
are still freon-based.
All plants comply with gas emission regulations.
Best practice is applied when we upgrade or add new distribution infrastructure.
The new Ongwediva distribution centre makes use of natural light and captures rainwater.
Food safetyThe food industry is highly regulated and food safety and
the containment of food wastage are critical concerns.
Our foodservice and FMCG distribution businesses also
benefit from close association with international brands
that adopt rigorous standards to ensure their reputation
for quality and food safety is maintained.
T&C works closely with brand principals like Nestlé to
insure international food safety and quality standards
are maintained. Regular audits are conducted to ensure
products are properly stored, expiry dates are respected
and product integrity is assured. All product specifications
laid down by brand principals are rigorously adhered to.
T&C employs an advanced warehouse management and
product tracking system to ensure prompt stock rotation.
The system has been rolled out to Caterplus’s Windhoek
distribution centre and will soon be introduced to its
other distribution hubs.
No product is distributed to a customer unless there is at
least a month to go before the expiry date.
Company policy on food waste is straightforward –
prevention is a priority. Every effort is taken to avoid
waste. Stock turn and stock control are focus areas.
When food has to be disposed of, management ensures
the disposal process complies in every respect with
local authority requirements and certifications. A zero-
tolerance policy is enforced on this issue. Waste is kept
to a minimum.
In addition, standard procedures ensure the cold chain –
where applicable – is maintained throughout the storage
and distribution cycle.
In our Fishing division, good progress was made with the
implementation of HACCP (the Hazard Analysis Critical
Control Point system), a process that identifies where
food safety hazards may occur and institutes controls to
prevent them happening.
By end of 2014, it is planned that all five vessels in the
Namsov fleet will be HACCP-compliant.
GROUP RISK MANAGEMENT PROCESS
Ultimate responsibility for risk management rests
with the board. Our directors also determine the risk
appetite of the Bidvest Namibia Group. However, the
board has delegated these responsibilities to the Group
risk management committee. The committee manages
threats and identifies opportunities.
Its task is to help the board identify all Group-wide
risks while fostering a risk management culture. The
committee also has the job of implementing policies and
controls and ensuring they function effectively.
Risk rating criteria have been established at each
business in the Group. Criteria are reviewed annually and
revised where appropriate. The risk committee receives
a report on the review and any changes. Focus areas
include potential monetary impacts, reputation, systems
and people.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201443
Key business risks are documented by senior managers at every business and risk exposure updated quarterly.
Mitigating steps and action plans to reduce or manage inherent risk are also documented.
Business unit risk matrices are consolidated into divisional and subdivisional risk matrices for reporting to quarterly risk
committee meetings.
In line with King III recommendations, senior managers and executive directors of all businesses conduct an annual
risk management workshop. They probe risk rating criteria, key risks, mitigating steps and the effectiveness of the risk
management process. The risk committee receives a report on workshop results.
Top risks for the Bidvest Namibia Group on June 30 2014 were:
Risk Current mitigating actions
Sufficient fishing quota/rights/access to resources/catching capacity
– Monitoring of catch data and health status of fishing stocks,
representation on advisory council to ministry, compliance with
ministerial requirements
– Strategically structuring access to sufficient quota to keep our fleet
efficiently employed
Market prices (fishing) – Monitoring laws/import restrictions and prices in various countries to
drive higher US dollar selling prices
Angolan shareholder dispute – The dispute between the 51% Angolan shareholder and his
representative for right of claim brings with it a legal, statutory and
commercial influence on the investment security of the Angolan
business. It is required and necessary that investment be maintained
to realise returns in line with expectation from this resource
– Maintain full support and assistance via professional legal
infrastructures in Angola to the recognised shareholder partner to
protect his position and our interest
Loss of key skills – Attractive market-related packages, succession planning and transfer
of skills
Inadequate business continuity planning
– Entities responsible for making business continuity plans
Non-compliance with health and safety rules
– HSE coordinators appointed in larger businesses
Unsuccessful acquisitions – Proper due-diligence reviews for proposed acquisitions
Loss of a brand principal for Food and Distribution
– Maintaining positive relationships and ensure performance targets are
achieved
Infant industry protection in Namibia limiting distribution of imported products
– Being up to date with the latest developments in this regard while
being proactive in advising on impact to consumers
Industrial action leading to disruption of services
– Manage relationships with employees and unions
Internal auditors help to evaluate the effectiveness of the risk management process and comment on it in their reports.
OUR PEOPLE
Our people are a source of competitive advantage. They are resilient and have a proven ability to deliver gains in tough
market conditions. A key management objective is to get the best out of our people through communication, motivation
and provision of appropriate support.
We communicate in various forums and invest in working environments that enable our people to perform to their best.
Bidvest Namibia encourages all employees to perform and strive to achieve business targets within a framework of
intrinsic values.
At year-end, the Group employed 3 239 people (2013: 3 203). This confirms the status of Bidvest Namibia as one of
the country’s largest job creators.
Employment equityBidvest Namibia is an equal opportunity employer. We invest in the continued training and development of our people,
without discrimination on the grounds of race, gender or disability.
Each year, we submit affirmative action plans and reports to the Employment Equity Commissioner. All companies are
compliant with the Affirmative Action (Employment) Act and we strive to achieve the Act’s objectives of employment
equity and workforce diversity. We also run development programmes for those from designated groups.
Since the Act’s inception in 1998, sustained employment equity gains have been achieved.
Namibianisation development programmes promote
the recruitment and advancement of Namibians.
Those from racially disadvantaged groups increasingly
take management responsibilities or work as
skilled specialists.
Black Namibians constitute the vast majority of
employees, in line with national demographics. Men
predominate, largely a function of the traditional
male bias in the fishing industry. Women increasingly
take on supervisory and managerial responsibilities.
Development of black Namibians into senior executive
positions is a business imperative.
Bidvest Namibia faces a challenge in the employment of
those with disabilities. Progress in this area is a priority
for management across the Group.
Bidfish employs a number of non-Namibians as some
operations are conducted in Angola or in Angolan
waters. In addition, some senior Russian naval officers
have posts in the fishing fleet. Training and development
initiatives are under way to address this anomaly.
Industrial relationsThe Group has several recognition agreements with
unions in various businesses. Our workforce is heavily
unionised. No industrial action was recorded, though
worker protests took place on issues connected with
conditions of employment. All protests were peaceful and
management maintained strong lines of communication
with worker representatives. Various wage claims went
to arbitration after pay talks stalled. Pay rates are
renegotiated annually.
Falling demand for the Group’s stevedoring service
led to restructuring. Labour challenged the plan for
retrenchments and the matter went to arbitration.
HealthThere were no work-related fatalities, though 38 lost-
time incidents were recorded.
Our safety policy makes it mandatory for our operations
to comply with the Labour Act and all legislation and
standards governing health, safety, welfare at work and
environmental control.
We provide a healthy and safe working environment,
supply all necessary safety and protective equipment
and train workers in the safety aspects of their jobs.
Training investment can be significant.
We ensure our people are continually made aware
of their responsibilities under our safety policy and
engage in ongoing employer-employee consultation on
matters relating to health and safety and protection of
the environment.
In the workplace, peer education supports wellness
awareness, training and monitoring. Dedicated peer
educators focus on HIV/Aids, TB, drug and alcohol abuse,
smoking cessation and lifestyle illnesses. Educators
increasingly make use of cellphones to communicate
key messages and run competitions to test worker
knowledge and understanding.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201444
Sustainability at Bidvest Namibia continued
Condom distribution is part of the effort to assist with family planning and address high-risk behaviours. In 2014, more
than 60 000 condoms were distributed.
Management is proactive on health and safety matters. Basic regulatory compliance is not enough. In 2014,
management ascertained that more than half the workforce was not covered by medical insurance and medical aid
schemes. Affordability was the key constraint.
The Group therefore contacted the Mister Sister Mobile Health Service – an intervention involving NGOs and government
that takes primary healthcare to low-income groups. We partnered with the programme and mobile clinics now provide
basic health services to employees without health insurance cover in Windhoek.
At Bidfish, safety officers are assigned to all vessels, while larger vessels have full health and safety committees on
board. Regular firefighting, first-aid and safety courses are run. Officers take advanced courses and undergo personal
survival training. Firefighting training and basic medical training are mandatory for navigation and engineering officers.
Officer training in radio communication is obligatory to ensure proficiency in radio procedures in the event of emergency.
Fire drills are carried out every five months on all vessels and emergency procedures are tested and reviewed. A regular
health and fitness check-up by a medical practitioner is mandatory for all seagoing crew. All crew must produce a
medical certificate.
Developing NamibiansWe enrolled 56 people at national and international educational institutions in 2014. Bursaries amounting to
NAD3,2 million were awarded. The vast majority of bursars are previously disadvantaged Namibians.
The investment in learnerships in 2014 totalled NAD4,6 million. Costs are substantial as training is conducted in South
Africa and Russia.
Namsov makes ongoing use of the training facilities at NAMFI (Namibian Maritime and Fisheries Institute). However,
NAMFI courses do not cover seagoing certification above classes 5 for navigation and 4 for engineering. Officer training
above this level is conducted at the Cape Peninsular University of Technology in South Africa in collaboration with NAMFI.
As part of its commitment to the Namibianisation of officers, Namsov commits annually to the RSA-based training of
one deck officer and one engineering student. Currently, we have six students who are enrolled in this programme (Out
of nine that were initially enrolled). Investment to date is NAD2,2 million.
Namsov operates several vessels that were built in the former USSR. At the time of purchase, operational, safety,
ships’ registry and insurance requirements laid down certain levels of seagoing certification for ships’ officers. Suitably
qualified Namibians were not available at the time. The vessels therefore arrived with Russian officers and crew.
Namsov made it a priority to Namibianise these vessels. Operational instructions were put into English, and Namibian
crew, below officer grade, were trained and deployed to the fleet.
Namsov became the first company in the Namibian midwater trawl industry to employ Namibian crew on its vessels.
The Namibianisation programme then moved to officer level.
Ten Namibian crew members who had obtained NAMFI
class 5 certification were selected for officer training in
Kaliningrad, Russia, to ensure they reached the same
level of competence of qualified Russian officers.
The ten officer trainees have successfully completed the
first three years of their studies and are now on the third
and final year of the programme. Cost of the programme
to date is NAD6,1 million – confirming a substantial
commitment to Namibianisation and the development of
a new generation of senior officers.
All Group businesses make increasing use of a dedicated
training centre at Manica. Focus areas in 2014 included
the Licence to Lead programme for supervisors (a six-
month, four-module course taken by 45 employees) and
a Licence to Sell course (taken by 40 employees).
In addition, the Group is a long-time supporter of CATS
(the government-backed Commercial Advancement
Training Scheme). This two-year programme is targeted
at school-leavers and combines training in the workplace
with courses offered by colleges and technikons.
A recent innovation, championed by the Group Exco,
entails the identification and selection of a high-potential
black Namibian who is then exposed – at executive
level – to businesses across the Group. This two-year
rotation process is complemented by attendance at
formal management training courses at Henley Business
School in Johannesburg, South Africa.
The divisions of Bidvest Namibia have a long-standing
commitment to training, with wide-ranging focus on
technical skills development, leadership development
and various “soft skills”. This commitment and attendant
training investments pre-date the government’s planned
introduction of the Namibian national training levy.
Bidvest Namibia welcomes the introduction of the levy as
it will help level the playing field in the training arena. The
system imposes a levy on employers. However, those
who use accredited training and development initiatives
to train their people will be entitled to reclaim 50% of the
training investment. This will incentivise businesses that
have not invested in proper training to do so.
In 2014, 1 449 staff attended formal training. The
Group’s training investment was NAD2,7 million.
Attracting and retaining skillsSkills enable business growth and innovation. The Group
therefore regards the recruitment and retention of skilled
people as a business imperative. The Bidvest Namibia
culture encourages initiative and attracts goal-setters
capable of taking independent responsibility. We enable
talented people to grow their careers, thereby helping
our business to grow at the same time.
We apply fair and reasonable recruitment and selection
practices and have set up an online recruitment website
to standardise recruitment initiatives and make them
widely accessible.
Bidvest Academy Graduates.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201445
Our standardised recruitment procedures are aligned with the provisions of the Affirmative Action (Employment) Act. All
positions are graded in accordance with the Patterson grading system.
Participation in annual Namibian market surveys enables us to track salary trends and ensure market-related
remuneration. Any remuneration anomalies have to be justified.
Executive remuneration is determined by an independent remuneration committee.
Our remuneration model allows flexibility. Employees represented by bargaining units receive increases based on annual
pay negotiations with the relevant trade unions.
Our performance-based culture rewards excellence, initiative and effort, while our decentralised business model
encourages autonomous operations to seek growth and opportunities in their respective markets. Performance is
incentivised through bonuses, awards and payment for the achievement of targets.
CORPORATE SOCIAL INVESTMENT
CSI totalled NAD26,2 million in 2014 (2013: NAD20,1 million). Commitments not only come from our businesses. Our
people also engage in various initiatives. The Pandula Trust, supported Group-wide by our people, is a key mechanism
for channelling these efforts. Among trust efforts in 2014 was support for micro-enterprises in the form of industrial
washing and sewing machines and woodworking equipment.
The Namsov Community Trust (a Namsov shareholder) is a major driver of CSI efforts across Namibia. Its focus falls on
health, education, ICT, enterprise development, job creation, the environment and community upliftment. Since inception
in 1991, the trust has invested NAD62,9 million in these areas. Investment in 2014 was NAD13,0 million.
To maximise the CSI impact, the trust frequently partners with NGOs, and other bodies and in 2014 strong focus fell
on the identification of national stakeholders and projects with the potential to deliver sustainable benefits to social
beneficiaries. Delivering the most benefit to the most vulnerable is the central objective.
Continued development of the trust’s fish distribution project was another point of focus. The initiative assists
communities while promoting grassroots entrepreneurship by providing start-up capital and equipment. Fridges and
scales are distributed to vendors to enable them to sell fish harvested by Namsov. The intervention contributes to the
food security of an estimated 1,2 million Namibians.
Another intervention – in collaboration with the office of the Deputy Prime Minister – involves the establishment of a
model farm for San resettlement. The project also contributes to the economic development, health and education of
the San community.
A new initiative undertaken in 2014 (in partnership with the office of the Prime Minister) entails the establishment of a
food bank. The immediate need is to provide a resource that will enable food distribution to areas of need. The longer-
term objective is to build capabilities that will contribute to national food security. The vision is to foster community-level
crop cultivation and stock rearing.
The trust also supports the Save the Rhino Trust and the Desert Lion Campaign.
Individual companies also make major CSI contributions.
For example, Trachurus donated 3 000 “health boxes’
to Namibia’s first lady, Madame Penehupifo Pohamba,
a contribution to the Organisation of African First Ladies
against HIV/Aids. The value of the donation topped
NAD2,4 million.
The boxes contain immune-booster products (fortified
porridge, high-energy drinks and soups), preventive
products (including anti-bacterial residual sprays) and
water purifier drops. Health boxes are distributed to those
with HIV/Aids and the victims of droughts and floods.
A company such as Manica focuses its CSI spend on
health, education, youth development, the environment
and enterprise development. One effort entails support
for Walvis Bay’s Sunshine Centre, a shelter for children
with special needs and a haven for abused women and
children. Manica support for the sunshine garden will
help residents grow produce, some of which can be sold,
thereby creating a self-sustaining micro-business.
Manica also supports brown hyena research and
provides bursaries to young people focused on a career
in logistics. Provision of disused cargo containers has
enabled an under-resourced school in Swakopmund to
create an extra classroom and storage facilities. Other
Manica interventions include provision of two-way radios
in support of crime-fighting initiatives and support for the
annual school beach clean-up.
Sport commitmentA major Group commitment is sponsorship of the Bidvest
Namibia Cup in partnership with the Namibian Football
Association. Our year-end coincided with the end of the
second year of this three-year sponsorship. Experience
in year two confirmed that all objectives are being met
– growing awareness of the Bidvest Namibia brand in
all regions of the country, close engagement with local
and regional government, development of the game of
soccer at all levels and better appreciation of the Group
as a responsible corporate citizen.
The format ensures that top teams frequently come up
against clubs from the lower divisions, creating a David
vs Goliath contest that generates great excitement. The
final involved a top side against a minnow and created
nationwide interest.
The game was screened live by the national broadcaster
and was shown across the continent on pay-TV’s Soccer
Africa Channel. Winners of the Bidvest Namibia Cup
gain automatic entry to the African Cup Winners Cup
– ensuring brand exposure in a prestige competition.
Further exposure is achieved in radio, print and
social media.
Donation for UNAM’s new facility in Keetmanshoop.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201446 BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201446
shared valuesWe have
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201447
Annual financial statements
Statement of directors’ responsibilities and
approval 48
Declaration by company secretary 48
Independent auditor’s report 49
Audit committee report 50
Directors’ report 52
Accounting policies 57
Statements of financial position 66
Statements of profit or loss and other
comprehensive income 67
Statements of changes in equity 68
Statements of cash flows 70
Notes to the financial statements 71
Shareholders’ diary 98
Administration 99
Our company logos 100
CommunicationAccountability
Excellence
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201448
The directors are required by the Companies Act of Namibia, 2004, to maintain adequate accounting records and are responsible for the content and integrity of the annual financial
statements and related financial information included in this report. It is their responsibility to ensure that the annual financial statements fairly present the state of affairs of the
Company and of the Group as at the end of the financial year and the results of their operations and cash flows for the year then ended, in conformity with International Financial
Reporting Standards (IFRS) and the Companies Act. The external auditors are engaged to express an independent opinion on the annual financial statements.
The annual financial statements are prepared in accordance with IFRS and are based upon appropriate accounting policies consistently applied and supported by reasonable and
prudent judgements and estimates.
The directors acknowledge that they are ultimately responsible for the system of internal financial control established by the Company and by the Group and place considerable
importance on maintaining a strong control environment. To enable the directors to meet these responsibilities, the directors set the standards for the internal control aimed at reducing
the risk of error or loss in a cost-effective manner. The standards include the proper delegation of responsibilities within an acceptable level of risk. These controls are monitored
throughout the Group and all employees are required to maintain the highest ethical standards in ensuring the Group’s business is conducted in a manner that in all reasonable
circumstances is above reproach. The focus of risk management in the Group is on identifying, assessing, managing and monitoring all known forms of risk across the Group. While
operating risk cannot be fully eliminated, the Company and the Group endeavour to minimise it by ensuring that appropriate infrastructure, controls, systems and ethical behaviour are
applied and managed within predetermined procedures and constraints.
The directors are of the opinion, based on the information and explanations given by management, that the system of internal control provides reasonable assurance that the financial
records may be relied on for the preparation of the annual financial statements. However, any system of internal financial control can provide only reasonable, and not absolute,
assurance against material misstatements or loss.
The directors are satisfied that the Company and Group have access to adequate resources to continue in operational existence for the foreseeable future.
The external auditors, Deloitte & Touche, have audited the annual financial statements and group annual financial statements, and their report is presented on page 49.
The Group annual financial statements and annual financial statements of the Company are set out on pages 38 to 39 and pages 52 to 97 which have been prepared on the going-
concern basis, were approved by the board of directors and are hereby signed on its behalf:
Lindsay Ralphs Sebulon Kankondi
Chairman Chief executive officer
August 28 2014 August 28 2014
Statement of directors’ responsibilities and approvalfor the year ended June 30 2014
In my capacity as company secretary, I hereby confirm, that for the year ended June 30 2014, the Company has lodged with the Registrar of Companies, all such returns as are
required in terms of this Act and that all such returns are true, correct and up to date.
Veryan Hocutt
Company secretary
August 28 2014
Declaration by company secretary
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201449
TO THE MEMBERS OF BIDVEST NAMIBIA LIMITED
We have audited the Group annual financial statements and annual financial statements of Bidvest Namibia Limited, which comprise the consolidated and separate statements of
financial position as at June 30 2014 and the consolidated and separate statements of profit or loss and other comprehensive income, the consolidated and separate statements
of changes in equity and the consolidated and separate statements of cash flows for the year then ended and a summary of significant accounting policies and other explanatory
information, and the directors’ report, as set out on pages 38 to 39 and pages 52 to 97.
DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL STATEMENTS
The Company’s directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and the
requirements of the Companies Act of Namibia, 2004 and for such internal controls 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.
AUDITOR’S 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 auditor’s
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
auditor considers internal control relevant to the entity’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 entity’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.
OPINION
In our opinion, the financial statements present fairly, in all material respects, the consolidated and separate financial position of Bidvest Namibia Limited as at June 30 2014 and their
consolidated and separate financial performance and consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards
and the requirements of the Companies Act of Namibia.
Deloitte & Touche
Registered Accountants and Auditors
Chartered Accountants (Namibia)
ICAN practice number: 9407
Per RH Mc Donald
Partner
PO Box 47, Windhoek, Namibia
August 28 2014
Regional executives: LL Bam (chief executive), A Swiegers (chief operating officer), GM Pinnock
Resident partners: E Tjipuka (managing partner), RH Mc Donald, J Kock, H de Bruin, J Cronjé, A Akayombokwa
Director: G Brand
Independent auditor’s report
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201450
The audit committee is a committee of the board of directors and it assists the board through advising and making submissions on financial reporting, oversight of the risk management
process and internal audit functions and statutory and regulatory compliance of the Company.
MEMBERSHIP
The audit committee members are appointed by the board, comprising a minimum of three members and chaired by an independent non-executive director. The committee comprises
Hans-Harald Müseler (chairman), David Cleasby and Martin Shipanga. The chairman of the committee reports to the board and to the Bidvest Group audit committee on the activities
and the recommendations made by the committee. The chief executive officer, financial director, head of the internal audit, the external audit partner and divisional executives attend
all meetings. The committee met four times during the 2014 financial year.
DELEGATED DUTIES AND RESPONSIBILITIES
The audit committee has adopted formal terms of reference that have been approved by the board of directors, and has executed its duties during the past financial year in accordance
with these terms of reference, which includes ongoing interaction with the risk committee:
– Assist the board in discharging its duties relating to the safeguarding of assets, the operation of adequate systems, control and reporting processes, and the preparation of accurate
reporting and financial statements in compliance with the applicable legal requirements and accounting standards
– Provide management, external and internal auditors access to the chairman or any other member of the committee about any matter within the committee’s scope
– Meet independently with the external and internal auditors at least once a year
– Provide a forum for discussing financial, enterprise-wide, market, regulator, safety and other risks and control issues, and to monitor controls designed to minimise these risks
– Review the Company’s annual integrated report, including the annual financial statements, as well as its interim report and any other public reports or announcements containing
financial information
– Oversee the activities of, and to ensure coordination between, the activities of internal and external audit
– Perform duties assigned to it under the Companies Act and other legislation
– Annually review the committee’s work and terms of reference and to make recommendations to the board to ensure its effectiveness.
The directors believe that the committee has satisfied its responsibilities under its mandate.
EXTERNAL AUDIT
The committee has nominated Deloitte & Touche for appointment as the Company’s lead auditors with PwC auditing the Bidfish Group and some of the Company’s other coastal
operations for the financial year ended June 30 2014. In the execution of its duties during the past financial year the committee has:
– approved the external audit engagement letter, the audit plan and the budgeted audit fees payable to the external auditors;
– obtained a statement from the independent auditors confirming that their independence was not impaired;
– determined the nature and extent of all non-audit services provided by the independent audits and pre-approved all non-audit services undertaken;
– obtained assurances from the independent auditors that adequate accounting records were being maintained; and
– confirmed that no material irregularities had been identified or reported by the independent auditors under the Public Accountants’ and Auditors’ Act.
Based on our satisfaction with the results of the activities outlined above, the committee recommended to the board that the same two audit firms should be reappointed for the 2015
financial year at the next annual general meeting.
FINANCIAL STATEMENTS
The committee confirmed, based on management’s review, that the interim and annual financial statements were prepared on the going-concern basis. It has:
– examined the interim and annual financial statements and other financial information made public, prior to their approval by the board;
– considered accounting treatments, significant or unusual transactions and accounting judgements;
– considered the appropriateness of accounting policies and any changes made thereto;
– reviewed the independent auditor’s audit report;
– reviewed the representation letter relating to the annual financial statements signed by the management;
– considered any problem identified, as well as any legal and tax matters that could materially affect the financial statements; and
– met separately with management, external audit and internal audit, and concluded that no material weakness exists.
The committee is of the opinion that the financial statements fairly present the financial position of the Group and Company at the end of the financial periods and the results of its
operations and cash flow for the financial periods then ended.
Audit committee reportfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201451
INTERNAL CONTROL AND INTERNAL AUDIT
The committee has reviewed and recommended the internal audit charter for approval and has:
– reviewed and approved the annual internal audit plans and evaluated the independence, effectiveness and performance of the internal audit function;
– considered the reports of the internal auditors and the independent external auditors on the Group’s systems of internal control including financial control, business risks management
and maintenance of effective internal control systems;
– received assurances that proper accounting records were maintained and that the systems safeguarded the Group’s assets against unauthorised use or disposal; and
– reviewed issues raised by internal audit and the adequacy of corrective action taken by management in response thereto.
Concluded that there were no material breakdowns in internal control and assessed the adequacy of the performance of the internal audit function and found it satisfactory.
RISK MANAGEMENT AND INFORMATION TECHNOLOGY
The committee reviewed the Group’s policies on risk assessment, including information technology risks and found them to be sound.
LEGAL AND REGULATORY REQUIREMENTS
The committee has:
– received from management legal matters that could have a material impact on the Group; and
– considered reports provided by management, internal audit and the independent auditors regarding compliance with legal and regulatory requirements.
Based on the information available, it is satisfied with the level of statutory compliance by the Company’s divisions.
COMBINED ASSURANCE
The committee reviewed the combined assurance model which is being developed, comprising the plans and reports of the external and internal auditors and other assurance providers
including management, and concluded that the significant risks identified are adequately addressed by management and other assurance providers.
ANNUAL STATUTORY ACCOUNTS
Following the review by the committee of the annual financial statements of Bidvest Namibia Limited for the year ended June 30 2014, the committee is of the view that, in all material
respects, it complies with the relevant provisions of the Companies Act and IFRS and fairly presents the financial position at June 30 2014 and the results of its operations and cash
flow for the year then ended. Having achieved its objectives for the financial year, the committee recommended the annual financial statements and the annual integrated report for
the year ended June 30 2014 to the board for approval.the year ended June 30 2014 to
Signed on behalf of the committee by:
Hans-Harald Müseler
Chairman
August 21 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201452
The directors have pleasure in presenting their annual integrated report which forms part of the Group annual financial statements and annual financial statements of the Company
for the year ended June 30 2014.
NATURE OF BUSINESS
The Company is the holding company of two operational subsidiaries, Bidvest Namibia Fisheries Holdings (Pty) Limited (Bidfish) and Bidvest Namibia Commercial Holdings (Pty) Limited
(Bidcom).
Bidvest Namibia Management Services (Pty) Limited, Bidvest Namibia Property Holdings (Pty) Limited and Bidvest Namibia Information Technology (Pty) Limited are also direct
subsidiaries of the holding company, and act as the support companies for the Bidvest Namibia Group. They receive administration income, rental income from subsidiaries in the
Group, as well as directors’ fees, if applicable, from all underlying entities and incur related support, staff and administration expenses.
Bidvest Namibia Commercial Holdings (Pty) Limited (Bidcom) has operational arms including stationery and office furniture, electrical supplies, food and distribution, office solutions,
printer consumables, freight management services and travel management services.
Bidvest Namibia Fisheries Holdings (Pty) Limited (Bidfish) has operational arms mainly in the fishing industry.
RESULTS OF OPERATIONS
The results of operations and state of affairs of the Group and the Company are fully set out in the attached annual financial statements and do not in our opinion require further
comment.
GOING CONCERN
The directors have satisfied themselves that no material uncertainty that cast significant doubt about the ability of the Group and the Company to continue as a going concern has been
identified, and they have a reasonable expectation that the Group and the Company have adequate financial resources to continue in operational existence for the foreseeable future.
Therefore, these financial statements have been prepared on a going-concern basis.
SUBSEQUENT EVENTS
No events have occurred between the reporting date and the date of this report which are material in their effect on the affairs of the Group.
AUTHORISED AND ISSUED SHARE CAPITAL
There were no changes to the authorised share capital during the year under review.
DIVIDENDS
Dividends amounting to NAD148,4 million (2013: NAD133,5 million) were declared and paid by the Company during the year under review.
SEGMENTAL ANALYSIS
Management has determined the operating segments based on the reports reviewed by the executive committee that are used to make strategic decisions. The committee considers
the business from a product perspective.
Segmental results include revenue and expenses directly relating to a business segment but exclude net finance charges and taxation which cannot be allocated to any specific
segment. Segmental trading profit is defined as operating profit excluding items of a capital nature and is the basis on which management’s performance is assessed.
Segment operating assets and liabilities include property, plant and equipment, investments, inventories, trade and other receivables, trade and other payables and post-retirement
obligations, but exclude current taxation and deferred taxation. Intangible assets are allocated to the cash-generating unit in the segment to which they relate.
Fishing derives revenue from its horse-mackerel, monk and pilchard fishing rights in Namibia and Angola.
Industrial and Commercial Products supplies electrical equipment and consumables, stationery, office equipment and furniture, printer consumables and hardware.
Food and Distribution Services supplies perishable foods to the hospitality, wholesale and retail industries in Namibia.
Freight and Logistics provides ships agency, clearing and forwarding, stevedoring, container handling, general warehousing and airport services.
Services provides travel and copier services.
Corporate Services includes corporate services provided to the Group.
Sales between segments were carried out on terms and conditions as agreed between the parties. The revenue from external parties is measured in a manner consistent with that in
the statements of comprehensive income.
Directors’ reportfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201453
The executive committee assesses the performance of the operating segments based on a measure of adjusted operating profit. This measurement basis excludes the effects of
non-recurring expenditure from the operating segments such as restructuring costs and goodwill impairments when the impairment is the result of an isolated, non-recurring event.
Full segmental report on pages 38 to 39.
INFORMATION ABOUT DIRECTORS’ SERVICE CONTRACTS
Each of the executive directors has a contract of appointment from Bidvest Namibia Limited, containing terms that are normal for such contracts.
INTEREST OF DIRECTORS AND SENIOR KEY PERSONNEL IN SHARE CAPITAL
The interests, direct and indirect, of the directors and officers in office at June 30 2014 are as follows:
Ordinary shares
Beneficial Indirect
At July 1 2013 10 781 733 250 000
At June 30 2014 10 974 633 250 000
Comprising:
Non-executive directors 331 000 1 068 000
Executive directors 1 391 200 –
J Arnold 14 000 –
SI Kankondi 1 377 200 –
Senior key personnel 9 252 433 –
DIRECTORS’ INTERESTS IN CONTRACTS
No material contracts in which the directors have an interest were entered into in the current year other than the transactions detailed in note 37 to the financial statements.
SHAREHOLDERS’ SPREAD
An analysis of holdings extracted from the register of ordinary shareholders at June 30 2014 is listed below:
Number of
shareholders
Percentage of
share capital
(nearest 1%)
The Bidvest Group Limited 1 51
Public:
Companies 16 10
Trust 6 0
Individuals 567 1
Pension and provident funds 39 22
Insurance companies and medical aid funds 5 1
Non-public:
Directors 10 1
Broad-based economic empowerment partner
Ovanhu Investments (Pty) Limited – related party 1 14
645 100
MAJOR SHAREHOLDERS
According to the share register, the following are the only shareholders beneficially holding, directly or indirectly, in excess of 5% of the share capital at June 30 2014:
Percentage holding
The Bidvest Group Limited 51
Ovanhu Investments (Pty) Limited 14
Government Institution Pension Fund 11
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201454
DIRECTORS’ REMUNERATION
The remuneration paid or accrued to directors while in office of the Company during the year ended June 30 2014 can be analysed as follows:
Pension and
Fees for Basic salary Bonuses medical aid
services and allowances accrued contributions Total
NAD’000 NAD’000 NAD’000 NAD’000 NAD’000
June 30 2014
Executive directors
SI Kankondi – 2 546 470 232 3 248
T Weitz – 1 253 190 206 1 649
J Arnold – 1 996 390 318 2 704
– 5 795 1 050 756 7 601
Non-executive directors
P Steyn 200 200
M Mokgatle-Aukhumes 114 114
HH Müseler 326 326
MK Shipanga 322 322
KE Taeuber 96 96
F Kapofi 26 26
B Eimbeck 26 26
1 110 1 110
June 30 2013
Executive directors
SI Kankondi – 2 379 450 217 3 046
HW Timke – 505 – 65 570
T Weitz – 1 126 200 183 1 509
J Arnold – 1 869 450 293 2 612
– 5 879 1 100 758 7 737
Non-executive directors
P Steyn 108 108
M Mokgatle-Aukhumes 108 108
HH Müseler 352 352
MK Shipanga 309 309
KE Taeuber 108 108
JL Bastos 24 24
1 009 1 009
Directors’ long-term incentives Number
Average price
NAD
Executive directors
SI Kankondi 150 000 11,30
J Arnold 125 000 11,30
T Weitz 75 000 11,30
350 000 11,30
These options were granted to directors on May 23 2013. Options vest in three tranches on the third, fourth and fifth years’ anniversaries respectively from the grant date and expire
within 10 years of their issue, or one month after the resignation of the director.
Directors’ share-based payment expense
2014
NAD’000
2013
NAD’000
SI Kankondi 180 15
J Arnold 156 13
T Weitz 96 8
432 36
Directors’ report continuedfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201455
SUBSIDIARIES
Principal subsidiary undertakings
Effective %
holding
Issued
share capital
NAD
Total
comprehensive
income/(loss)
NAD
The Bidvest Namibia Limited subsidiaries are all incorporated in Namibia, except for Comet Investments
Capital Incorporated, a company registered in the British Virgin Islands, Frigocentre Limitada and Pesca Fresca
Limitada which are registered in Angola.
By the Company
Bidvest Namibia Commercial Holdings (Pty) Limited 100,00 100 39 269
Bidvest Namibia Fisheries Holdings (Pty) Limited 100,00 1 613 124 686
Bidvest Namibia Information Technology (Pty) Limited 100,00 100 1 384
Bidvest Namibia Property Holdings (Pty) Limited 100,00 5 000 1 629
Bidvest Namibia Management Services (Pty) Limited 100,00 100 (1 144)
Through subsidiaries
Atlantic Harvesters of Namibia (Pty) Limited 69,55 300 19 095
Carapau Fishing (Pty) Limited 69,55 1 000 –
Caterplus Namibia (Pty) Limited 100,00 1 (192)
Cecil Nurse Namibia (Pty) Limited 100,00 100 2 331
Comet Investments Capital Incorporated 69,55 762 (9 780)
Elzet Development (Pty) Limited 100,00 100 318
Frigocentre Limitada^^ 34,74 76 243 –
Kolok (Namibia) (Pty) Limited 100,00 100 1 941
Lubrication Specialists (Pty) Limited 100,00 200 3 553
Lüderitz Bay Shipping & Forwarding (Pty) Limited 100,00 100 2 620
Manica Group Namibia (Pty) Limited 100,00 279 187 15 982
Matador Enterprises (Pty) Limited 100,00 1 000 12 007
Minolco (Namibia) (Pty) Limited 100,00 100 3 993
Monjasa Namibia (Pty) Limited 100,00 100 67
Mukorob Pelagic Processors (Pty) Limited 69,55 19 014 1 511
Namfish Pelagic Industries (Pty) Limited 69,55 100 4 440
Namibian Sea Products (Pty) Limited 69,55 46 997 005 71 789
Namsov Fishing Enterprises (Pty) Limited 69,55 100 000 252 107
Namsov Industrial Properties (Pty) Limited 69,55 1 000 192
Ocean Fresh (Pty) Limited 69,55 2 –
Pesca Fresca Limitada* 34,08 152 486 –
Rennies Travel (Namibia) (Pty) Limited 100,00 1 000 3 785
Sarusas Development Corporation (Pty) Limited 69,55 1 000 8 337
Starting Right Investments Two Zero Five (Pty) Limited 100,00 100 3 378
Taeuber & Corssen SWA (Pty) Limited 100,00 6 000 000 42 509
T&C Properties Namibia (Pty) Limited 100,00 8 000 5 213
T&C Trading (Pty) Limited 100,00 4 000 5 439
Tetelestai Mariculture (Pty) Limited 69,55 100 (353)
Trachurus Fishing (Pty) Limited^ 42,09 100 000 82 838
Twafika Fishing Enterprises (Pty) Limited 52,23 2 000 620
United Fishing Enterprises (Pty) Limited 69,55 4 000 32 599
Voltex (Namibia) (Pty) Limited 100,00 100 (3 230)
Waltons Namibia (Pty) Limited 100,00 6 5 489
Walvis Bay Stevedoring Company (Pty) Limited 55,00 100 1 304
Walvis Bay Airport Services (Pty) Limited 100,00 5 000 (8 393)
Woker Freight Services (Pty) Limited 100,00 28 636 4 883
Joint venture
!OE#GAB Fishing Enterprises (Pty) Limited 34,78 100 –
* The Group has de facto control as a result of the management agreement between Comet Investment Capital Incorporated and Pesca Fresca Limitada.^ The Group has a direct shareholding of 51% in Trachurus Fishing (Pty) Limited.^^ The Group has a direct shareholding of 99% in Frigocentre Limitada through its de facto control of Pesca Fresca Limitada.
HOLDING COMPANY
The Company is a subsidiary of The Bidvest Group Limited, a company registered in the Republic of South Africa, and listed on the Johannesburg Stock Exchange (JSE).
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201456
DIRECTORS AND SECRETARY
The following persons were directors of the Company during the year and up to the report signing date:
Date appointed/resigned Nationality
B Joffe (Chairman) Appointed: July 29 1994 South African
SI Kankondi (Chief executive) Appointed: August 10 2007 Namibian
J Arnold Appointed: January 17 2007 Namibian
DE Cleasby Appointed: January 17 2007 South African
M Mokgatle-Aukhumes Appointed: August 10 2007 Namibian
HH Müseler Appointed: August 10 2007 Namibian
MK Shipanga Appointed: August 21 2009 Namibian
PC Steyn Appointed: January 17 2007 South African
T Weitz (Financial director) Appointed: August 18 2011 Namibian
KE Taeuber Resigned: August 22 2014 South African
LP Ralphs Appointed: February 26 2014 South African
B Eimbeck Appointed: March 3 2014 Namibian
F Kapofi Appointed: March 3 2014 Namibian
The Company secretary is V Hocutt whose business and postal addresses are:
Business address Postal address
4 Robert Mugabe Avenue PO Box 6964
Windhoek Ausspannplatz
Namibia Windhoek
Namibia
AUDITORS
Deloitte & Touche will continue in office in accordance with section 278(2) of the Companies Act of Namibia.
Directors’ report continuedfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201457
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these separate and consolidated financial statements are set out below. These accounting policies have been
consistently applied to all years presented, unless otherwise stated.
2. BASIS OF PREPARATION
The consolidated and separate financial statements of Bidvest Namibia Limited have been prepared in accordance with, and comply with International Financial Reporting
Standards (IFRS), adopted by the International Accounting Standards Board (IASB) and interpretations issued by the International Financial Reporting Interpretations Committee
(IFRIC) of the IASB, and the Companies Act of Namibia, 2004. The financial statements are prepared in accordance with the going-concern principle under the historical cost
basis, except for biological assets and financial instruments, which are stated at fair value. Historical cost is generally based on the fair value of the consideration given in
exchange for assets.
It is important to note that this financial information has been prepared in accordance with IFRS that are effective June 30 2014. Standards and interpretations that
are not yet effective and will be adopted in future years are listed in note 40. The directors and management have not yet assessed the implications of standards and
interpretations that are not yet effective.
The preparation of financial statements in conformity with IFRS requires management to make judgements, estimates and assumptions that affect the application of policies
and reported amounts of assets and liabilities, income and expenses. Although estimates and associated assumptions are based on historical experience and various
other factors that are believed to be reasonable under the circumstances (the results of which form the basis of making judgements about carrying values of assets and
liabilities that are not readily apparent from other sources), the actual outcome may differ from these estimates in note 39.
The financial statements are presented in Namibia dollar (NAD), which is the Group’s functional currency. All financial information has been rounded to the nearest thousand
unless stated otherwise.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised,
if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
3. NEW AND REVISED ACCOUNTING STANDARDS
The Group has adopted the following new standards and amendments to standards, including any consequential amendments to other standards, with a date of initial
application of July 1 2013.
– IFRS 10 Consolidated Financial Statements
– IFRS 11 Joint Arrangements
– IFRS 12 Disclosure of Interests in Other Entities
– IFRS 13 Fair Value Measurement
– IAS 19 Employee Benefits
The nature and the effect of the changes are further explained below:
IFRS 10 Consolidated Financial Statements IFRS 10 addresses the divergence arising from the control-based principles in IAS 27 and the risks and rewards based approach in SIC 12 and in addition, provides greater
guidance on de facto control.
Management has reassessed the control conclusion for each of its investees at July 1 2013. No changes were identified and the adoption of this new standard has thus
had no impact on the financial results.
IFRS 11 Joint Arrangements IFRS 11 identifies two types of joint arrangements, joint operations and joint ventures, and prohibits the use of proportionate consolidation for joint ventures.
Management has assessed the Group’s involvement in joint arrangements in accordance with the requirements of IFRS 11 and concluded that the Group’s investment in
!OE#GAB Fishing Enterprises (Pty) Limited, which was proportionately consolidated under IAS 31, should be classified as a joint venture under IFRS 11 and accounted for
using the equity method. The impact is not material and as a result the prior year numbers were not restated.
IFRS 12 Disclosure of Interests in Other Entities IFRS 12 is a disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or unconsolidated subsidiaries.
The adoption of IFRS 12 has resulted in more extensive disclosures in the consolidated financial statements.
IFRS 13 Fair Value Measurement IFRS 13 is a single cohesive standard consolidating the principles of fair value measurement and disclosures for financial reporting. Fair value measurements of a non-
financial asset will take into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another
market participant that would use the asset in its highest and best use.
In accordance with the transitional provisions of IFRS 13, the Group has applied the new fair value measurement guidance prospectively. Notwithstanding the above, the
change had no significant impact on the measurements of the Group’s assets and liabilities, but resulted in increased disclosure.
Accounting policiesfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201458
3. NEW AND REVISED ACCOUNTING STANDARDS (continued)
IAS 19 Employee Benefits The revised IAS 19 changes the accounting for defined benefit plans and termination benefits. The most significant change relates to the accounting for changes in defined
benefit obligations and plan assets. The amendments required the recognition of changes in defined benefit obligations and in the fair value of plan assets when they occur,
and hence eliminate the “corridor approach” permitted under the previous version of IAS 19 and accelerate the recognition of past service costs. All actuarial gains and losses
are recognised immediately through other comprehensive income in order for the net pension asset or liability recognised in the consolidated statement of financial position
to reflect the full value for the plan deficit or surplus. Furthermore, the interest cost and expected return on plan assets used in the previous version of IAS 19 are replaced
with a “net interest” amount, which is calculated by applying the discount rate to the net defined benefit liability or asset.
The adoption of the changes to this statement have had a limited impact on the results of the Group. No adjustment has been made to the results for the year ended
June 30 2013 as the amounts are considered to be immaterial. The impact of the change in policy has been included in the current year’s results.
Details of new standards and interpretations that apply to the Group are contained in note 40 to the financial statements.
4. CONSOLIDATION
(a) Subsidiaries Subsidiaries are all entities (including special-purpose entities) over which the Group has the power to govern the financial and operating policies generally
accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible
are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group.
They are deconsolidated from the date that control ceases.
The acquisition method is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as the fair value of the assets given,
equity instruments issued and liabilities incurred or assumed at the date of exchange. Acquisition-related costs are recognised in profit or loss as incurred. Identifiable
assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective
of the extent of any non-controlling interest. The excess of the cost of the acquisition over the fair value of the share of the Group of the identifiable net assets
acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly
in profit or loss.
Inter-company transactions, balances and unrealised gains of transactions between Group companies are eliminated. Unrealised losses are also eliminated but
considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the
policies adopted by the Group.
Common control transactions are business combinations in which all of the combining entities are ultimately controlled by the same entity before and after the
transaction. These transactions are accounted for at predecessor values. Assets and liabilities acquired are accounted for at the book value used in the consolidated
financial statements of the highest entity that has common control. The difference between the amount paid and the book value of the net assets acquired are taken
to retained earnings.
The investment in subsidiaries is recognised at cost less accumulated impairment in the separate financial statements of the Company.
(b) Transactions and non-controlling interest The Group applies a policy of treating transactions with non-controlling interest as transactions with parties external to the Group. Disposals to non-controlling interests
result in gains and losses for the Group and are recorded directly in equity. Purchases from non-controlling interests result in goodwill, being the difference between
any consideration paid and the relevant share acquired of the carrying value of net assets of subsidiary.
(c) Associates Associates are all entities over which the Group has significant influence but not control, generally accompanying a shareholding of between 20% and 50% of the
voting rights. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s investment in
associates includes goodwill identified on acquisition, net of any accumulated impairment loss.
The Group’s share of its associates’ post-acquisition profits or losses is recognised in the statement of comprehensive income, and its share of post-acquisition
movements in reserves is recognised in reserves. The cumulative post-acquisition movements are adjusted against the carrying amount of the investment. When the
Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further
losses, unless it has incurred obligations or made payments on behalf of the associate.
The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group
calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in the
statement of comprehensive income.
Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associates. Unrealised profits are
also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Accounting policies of associates have been changed where
necessary to ensure consistency with the policies adopted by the Group. Dilution gains and losses arising in investments in associates are recognised in the statement
of comprehensive income.
Accounting policies continuedfor the year ended June 30 2014
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Annual Integrated Report 201459
4. CONSOLIDATION (continued)
(d) Joint venture A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement have rights to the net assets of the joint arrangement. Joint control
is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties
sharing control.
5. SEGMENT REPORTING
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who
is responsible for allocating resources and assessing performance of the operating segments, has been identified as the executive committee that makes strategic decisions.
The reportable segments of the Group have been identified based on the nature of the businesses. This basis is representative of the internal structure for management
purposes.
“Segmental operating profit” includes revenue and expenses directly relating to a business segment but exclude net finance charges and taxation which cannot be allocated
to any specific segment. Share-based payment costs are also excluded from the result as this is not a criteria used in the management of the reportable segments.
“Segmental trading profit” is defined as operating profit excluding items of a capital nature and is the basis on which management’s performance is assessed.
Segment operating assets and liabilities include property, plant and equipment, investments, inventories, trade and other receivables, trade and other payables, banking
assets and liabilities, insurance funds and post-retirement obligations but exclude cash, borrowings, current taxation and deferred taxation. Intangible assets are allocated
to the cash-generating unit in the segment to which they relate.
6. TRANSLATION OF FOREIGN CURRENCIES
(a) Functional and presentation currency Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity
operates (Namibian dollar). The consolidated financial statements are presented in Namibia dollar (NAD), which is the Group’s functional and presentation currency.
(b) Transactions and balances Foreign currency transactions are translated into the functional currency using exchange rates prevailing at the dates of the transactions. Foreign currency gains and
losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign
currencies are recognised in profit or loss, except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.
Changes in the fair value of monetary securities denominated in foreign currency classified as available for sale are analysed between translation differences resulting
from changes in the amortised cost of the security, and other changes in the carrying amount of the security. Translation differences related to changes in amortised
cost are recognised in profit or loss, and other changes in carrying amount are recognised in other comprehensive income.
Translation differences on non-monetary financial assets and liabilities are reported as part of the fair value gain or loss. Translation differences on non-monetary
financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation
differences on non-monetary financial assets such as equities classified as available for sale are included in the available-for-sale reserve in other comprehensive
income.
(c) Group companies The results and financial position of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation
currency as follows:
(i) Assets and liabilities: each statement of financial position balance presented is translated at the closing rate at the date of that statement of financial position.
(ii) Income and expenses: each statement of comprehensive income presented is translated at average exchange rates (unless this average is not a reasonable
approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the date
of the transactions).
(iii) All resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in foreign operation and of borrowings and other instruments designated as
hedges of such investments, are taken to shareholders’ equity. When a foreign operation is partially disposed of or sold, exchange differences that were recorded in
equity are recognised in the statement of comprehensive income as part of the gain or loss on the sale.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the
closing rate.
7. PROPERTY, PLANT AND EQUIPMENT
All property, plant and equipment are stated at historical cost less accumulated depreciation and accumulated impairment losses. Historical cost includes expenditure that
is directly attributable to the acquisition of the items. Cost may also include transfers from equity of any gains or losses on qualifying cash flow hedges of foreign currency
purchases of property, plant and equipment.
Subsequent costs are included in the carrying amount of the asset or are recognised as a separate asset, as appropriate, only when it is probable that future economic
benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201460
7. PROPERTY, PLANT AND EQUIPMENT (continued)
Depreciation is calculated on the straight-line method to write off the cost of each asset to its residual value over its estimated useful life as follows:
Item Useful life
Buildings 48 – 84 years
Plant and machinery 3 – 20 years
Office furniture, fittings and equipment 3 – 10 years
Motor vehicles 4 years
Fishing vessels’ dry docking and fishing equipment 3 – 10 years
Computer equipment 3 years
Fishing vessels 25 – 55 years
Rental assets in field 3 years
Land is not depreciated as it is deemed to have an indefinite life.
Refits of fishing vessels which relate to separate components are capitalised when incurred, and amortised over their useful lives.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease.
The residual values and useful lives of the assets are reviewed, and adjusted if appropriate on a prospective basis, at each financial year-end. The residual value of an item
of property, plant and equipment is the amount it estimates it would receive currently for the asset if the asset were already of the age and in the condition expected at the
end of its useful life. Where parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items of property, plant and
equipment.
Repairs and maintenance are generally charged to expenses during the financial period in which they are incurred. However, major renovations are capitalised and included
in the carrying amount of the asset when it is probable that future economic benefits in excess of the originally assessed standard of performance of the existing asset will
flow to the Group. Major renovations are depreciated over the remaining useful life of the related asset. All other repairs and maintenance are charged to profit or loss during
the financial period in which they are incurred.
Gains and losses on disposals are determined by comparing proceeds with the carrying amount and are recognised within profit or loss.
8. INTANGIBLE ASSETS
(a) Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of the net identifiable assets of the acquired subsidiary/associate
at the date of acquisition. Goodwill on acquisitions of subsidiaries is included in “intangible assets”. Goodwill on acquisition of associates is included in “investments
in associates” and is tested for impairment as part of the overall balance. Separately recognised goodwill is tested annually for impairment and carried at cost less
accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses on the disposal of an entity include the carrying amount of goodwill
relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating units or groups of cash-
generating units that are expected to benefit from the business combination in which the goodwill arose identified according to operating segment. The recoverable
amount of cash-generating units to which goodwill is allocated is estimated annually on March 31 each year.
(b) Trademarks and licences and fishing quota rights Acquired trademarks and licences are shown at historical cost. Fishing quota rights, trademarks and other intangible assets have a finite useful life and are carried at
cost less accumulated amortisation. Amortisation is calculated using the straight-line method to allocate the cost of the intangible assets over their estimated useful
lives (five to 20 years). An intangible asset is recognised when it is probable that the expected future economic benefits that are attributable to the asset will flow to
the entity and the cost of the asset can be measured reliably.
(c) Computer software Costs associated with maintaining computer software programmes are recognised as an expense as incurred. Development costs that are directly attributable to
the design and testing of identifiable and unique software products controlled by the Group are recognised as intangible assets when the required criteria are met.
Directly attributable costs that are capitalised as part of the software product include the software development employee costs and an appropriate portion of relevant
overheads. Other development expenditures that do not meet these criteria are recognised as an expense as incurred. Development costs previously recognised as an
expense are not recognised as an asset in a subsequent period.
Computer software development costs recognised as assets are amortised over their estimated useful lives which do not exceed seven years.
Accounting policies continuedfor the year ended June 30 2014
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Annual Integrated Report 201461
9. FINANCIAL INSTRUMENTS
9.1 Financial assets9.1.1 Classification The Group classifies its financial assets as subsequently measured at either amortised cost or at fair value through profit or loss on the basis of both the entity’s business
model for managing financial assets and the contractual cash flow characteristics of the financial asset. Financial assets are measured at amortised cost if both of the
following conditions are met: the asset is held within a business model which objective is to hold assets in order to collect contractual cash flows; and the contractual term
of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. If a measurement or
recognition inconsistency is eliminated or significantly reduced by designating a financial asset as measured at fair value through profit or loss, the Group has the discretion
to elect this option at the financial asset’s initial recognition. Classification is not based on an instrument-by-instrument approach, but is determined at a higher level of
aggregation.
This classification is determined at initial recognition of a financial asset. At this point, the Group may make an irrevocable election to present in profit or loss subsequent
changes in fair value of an investment in an equity instrument that is not held for trading.
Trade and other receivables are classified as financial assets at amortised cost.
9.1.2 Recognition and measurement Initial measurement
Regular purchases and sales of financial assets are recognised on the trade date, the date on which the Group commits to purchase or sell the asset. Investments are initially
recognised at fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the
financial asset. Financial assets carried at fair value through profit or loss are initially recognised at fair value and transaction costs are expensed in profit or loss.
Derecognition
Financial assets are derecognised when the rights to receive cash flows from the investments have expired or have been transferred and the Group has transferred
substantially all risks and rewards of ownership.
Subsequent measurement
Financial assets at fair value are subsequently carried at fair value. Financial assets at amortised cost are carried at amortised cost using the effective interest method.
Realised and unrealised gains or losses arising from changes in the fair value of a financial asset that is measured at fair value and is not part of a hedging relationship shall
be recognised in profit or loss within “realised gains/(losses) on financial assets” or “unrealised gains/(losses) on financial assets” in the period in which they arise, unless
the financial asset is an investment in an equity instrument and the entity has elected to present gains and losses on that investment in other comprehensive income.
Gains or losses on a financial asset that is measured at amortised cost and is not part of a hedging relationship shall be recognised in profit or loss when the financial asset
is derecognised, impaired or reclassified, and through the amortisation process.
Dividend income from financial assets at fair value and financial assets at amortised cost is recognised in profit or loss as part of investment income when the Group’s
right to receive payments is established. Interest on financial assets at fair value and financial assets at amortised cost calculated using the effective interest rate method is
recognised in profit or loss as part of investment income.
9.2 Financial liabilities9.2.1 Classification The Group classifies its financial liabilities as at fair value through profit or loss or as financial liabilities at amortised cost. The Group has the option to classify the financial
liability as at fair value through profit or loss if it is held for trading or if the prerequisites in IAS 39 par 9(b) are met and it is designated upon initial recognition at fair value
through profit or loss.
Trade and other payables are classified as financial liabilities at amortised cost.
Initial measurement
Financial liabilities are recognised when the Group becomes a party to the contractual provisions of the instrument. They are initially recognised at fair value plus, in the case
of financial liabilities not at fair value through profit or loss, transaction costs that are directly attributable to the acquisition of the liability. Financial liabilities carried at fair
value through profit or loss are initially recognised at fair value and transaction costs are expensed in profit or loss.
Derecognition
Financial liabilities are derecognised when they are extinguished – the obligation specified in the contract is discharged or cancelled or expires. The difference between the
carrying amount of the financial liability derecognised and consideration paid/payable is recognised in profit or loss.
Subsequent measurement
Financial liabilities at amortised cost are carried at amortised cost using the effective interest method. Financial liabilities at fair value are subsequently carried at fair value,
unless the exceptions in IAS 39 par 47 apply.
Gains or losses on a financial liability that is measured at amortised cost and is not part of a hedging relationship shall be recognised in profit or loss when the financial
liability is derecognised, impaired or reclassified, and through the amortisation process.
Realised and unrealised gains or losses arising from changes in the fair value of a financial liability that is measured at fair value and is not part of a hedging relationship
shall be recognised in profit or loss within “realised gains/(losses) on financial liabilities” or “unrealised gains/(losses) on financial liabilities” in the period in which they arise.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201462
10. OFFSETTING FINANCIAL INSTRUMENTS
Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally enforceable right to offset the recognised
amounts and there is an intention to settle on a net basis, or realise the asset and settle the liability simultaneously.
11. IMPAIRMENT OF FINANCIAL ASSETS
The Company and the Group assesses at each financial year-end whether there is objective evidence that a financial asset or a group of financial assets is impaired.
A financial asset or group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more
events that occurred after the initial recognition of the asset (a “loss event”) and that loss event (or events) has an impact on the estimated future cash flows of the financial
asset or group of financial assets that can be reliably estimated.
The criteria that the Company and the Group use to determine that there is objective evidence of an impairment loss include:
– significant financial difficulty of the issuer or obligor;
– a breach of contract, such as a default or delinquency in interest or principal payments;
– the Company, for economic or legal reasons relating to the borrower/debtor’s financial difficulty, granting to the borrower/debtor a concession that the lender would not
otherwise consider;
– it becomes probable that the borrower/debtor will enter bankruptcy or other financial reorganisation;
– the disappearance of an active market for that financial asset because of financial difficulties; or
– observable data indicating that there is a measurable decrease in the estimated future cash flows from a portfolio of financial assets since the initial recognition of those
assets, although the decrease cannot yet be identified with the individual financial assets in the portfolio, including: adverse changes in the payment status of borrowers
in the portfolio; and national or local economic conditions that correlate with defaults on the assets in the portfolio.
The Company first assesses whether objective evidence of impairment exists.
(a) Assets carried at amortised cost The amount of the loss is measured as the difference between the carrying amount of the asset and the present value of estimated future cash flows (excluding future
credit losses that have not been incurred) discounted at the original effective interest rate of the financial asset. The carrying amount of the financial asset is reduced
and the amount of the loss is recognised in profit or loss. If the financial asset has a variable interest rate, the discount rate for measuring any impairment loss is the
current effective interest rate determined under the contract. As a practical expedient, the Company may measure impairment on the basis of an instrument’s fair value
using an observable market price.
Receivables with a short duration are not discounted.
(b) Equity instruments for which the entity has elected to present gains and losses in other comprehensive income In the case of equity instruments for which the entity has elected to present gains and losses in other comprehensive income, a significant or prolonged decline in the
fair value of the instrument below its cost is also evidence that the assets are impaired. If any such evidence exists, the cumulative loss – measured as the difference
between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss – is removed from equity
and recognised in profit or loss.
(c) Reversals of impairment If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was
recognised (such as an improvement in the debtor’s credit rating), the reversal of the previously recognised impairment loss is recognised in profit or loss, unless the
investment is an equity instrument and the entity has elected to present gains and losses on that investment in other comprehensive income, in which case impairment
losses recognised in profit or loss on equity instruments are reversed through profit or loss.
12. INVENTORIES
Inventories are stated at the lower of cost and net realisable value. Cost is determined on either the first-in, first-out (FIFO) method or average costs basis. The cost of the
finished goods comprises raw materials, direct labour, other direct cost and related production overheads, but excludes borrowing costs. Net realisable value is the estimate
of the selling price in the ordinary course of business, less the cost of completion and selling expenses.
13. BIOLOGICAL ASSETS
Biological assets consist of oysters.
Biological assets are stated at fair value less estimated point-of-sale cost. The fair value of oysters is determined using the present value of expected net cash flows from
the oysters, discounted using a pre-tax market-determined rate. Fair value changes are recognised in profit or loss. All expenses incurred in establishing and maintaining
the assets are recognised in profit or loss. All costs incurred in acquiring biological assets are capitalised. Finance charges are not capitalised.
14. TRADE AND OTHER RECEIVABLES
Trade receivables are amounts due from customers for merchandise sold or services performed in the ordinary course of business. If collection is expected in one year or
less (or in the normal operating cycle of the business if longer), they are classified as current assets. If not, they are presented as non-current assets.
Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.
Accounting policies continuedfor the year ended June 30 2014
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Annual Integrated Report 201463
15. CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less,
and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.
16. IMPAIRMENT OF NON-FINANCIAL ASSETS
Assets that have an indefinite useful life, for example goodwill, are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation
are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for
the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of the fair value less cost to sell of the asset
and its value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels at which there are separately identifiable cash flows (cash-generating
units). Non-financial assets other than goodwill that have suffered an impairment are reviewed for possible reversal of the impairment at each reporting date. Impairment
losses and reversal of impairment losses are recognised in profit or loss.
17. NON-CURRENT ASSETS HELD FOR SALE
Non-current assets (or disposal groups comprising assets and liabilities) that are expected to be recovered primarily through sale rather than through continuing use
are classified as held for sale and are carried at the lower of carrying value and fair value less cost to sell. Immediately before classification as assets held for sale, the
measurement of the assets (and all assets and liabilities in a disposal group) is determined in accordance with applicable IFRS. Then, on initial classification as assets held
for sale, non-current assets and disposal groups are recognised at the lower of the carrying amounts and fair value less costs to sell. Any impairment loss on a disposal
group is first allocated to goodwill, and then to remaining assets and liabilities on a pro rata basis, except that no loss is allocated to inventories, financial assets, deferred
tax assets, and employee benefit assets, which continue to be measured in accordance with the Group’s accounting policies. Impairment losses on initial classification as
held for sale and subsequent gains or losses on remeasurement are recognised in the profit or loss. Gains are not recognised in excess of any cumulative impairment loss.
A discontinued operation results from the sale or abandonment of an operation that represents a separate major line of business or geographical area of operations and of
which the assets, net profit or loss and activities can be distinguished physically, operationally and for financial reporting purposes. A subsidiary acquired exclusively with the
view to resale is also classified as a discontinued operation. Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria to be
classified as held for sale, if earlier. When an operation is classified as a discontinued operation, the comparative statement of profit or loss and other comprehensive income
is restated as if the operation had been discontinued from the start of the comparative period.
18. SHARE CAPITAL AND EQUITY
An equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities.
Ordinary shares and non-redeemable preference shares with discretionary dividends are classified as equity. Other shares, including mandatory redeemable preference
shares, are classified as liabilities.
Incremental cost directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Where any Group company purchases the Company’s equity share capital (treasury shares), the consideration paid, including any directly attributable incremental costs
(net of income taxes) is deducted from equity attributable to the Company’s equity holders until the shares are cancelled or reissued. Where such ordinary shares are
subsequently reissued, any consideration received, net of any directly attributable incremental transaction costs and the related income tax effects, is included in equity
attributable to the Company’s equity holders.
19. CURRENT AND DEFERRED INCOME TAX
The tax expense for the year comprises current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other
comprehensive income or directly in equity. In this case the tax is also recognised in other comprehensive income or directly in equity, respectively.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the financial year-end in the countries where the Company’s
subsidiaries and associates operate and generate taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which
applicable tax regulation is subject to interpretation and establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.
Deferred income tax is recognised in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying
amounts in the consolidated financial statements. However, deferred income tax is not recognised if it arises from initial recognition of an asset or liability in a transaction
other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates
(and laws) that have been enacted or substantively enacted by the financial year-end and are expected to apply when the related deferred income tax asset is realised or the
deferred income tax liability is settled.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilised.
Deferred income tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary
difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.
20. TRADE AND OTHER PAYABLES
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Accounts payable are classified as
current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities.
Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201464
21. PROVISIONS
Provisions are recognised when the Group has a legal or constructive obligation as a result of past events, for which it is probable that an outflow of economic benefits will
occur, and where a reliable estimate can be made of the amount of the obligation. Where the effect of discounting is material, provisions are discounted. The discount rate
used is a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.
A provision for restructuring is recognised when the Group has approved a detailed and formal restructuring plan and the restructuring has either commenced or has been
announced publicly. Future operating costs are not provided for.
22. BORROWINGS
Borrowings are recognised initially at the fair value of the proceeds received, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any
difference between proceeds (net of transaction costs) and the redemption value is recognised in profit or loss over the period of the borrowings using the effective interest
method.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the year-end.
23. REVENUE RECOGNITION
Revenue comprises the fair value of the consideration received or receivable for the sale of good and services in the ordinary course of the Group’s and Company’s activities
and includes net billings, commission related to clearing and forwarding transactions, fees earned for services rendered and payments received in exchange for goods.
Revenue is shown net of value-added tax, returns, rebates and discounts and after eliminating sales within the Group.
The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and when specific
criteria have been met, for each of the Group’s activities as described below. The amount of revenue is not considered to be reliably measured until all contingencies
relating to the sales, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement and there is no continuing involvement of
management.
Where the Group acts as an agent and is remunerated on a commission basis, only net commission income, and not the value of the business handled, is included in revenue.
Revenue is recognised as follows:
(i) Sale of goods Revenue from the sale of goods is recognised when significant risks and rewards of ownership of the goods are transferred to the buyer.
(ii) Rendering of services Revenue arising from rendering of services is based on the stage of completion determined by reference to services performed to date as a percentage of total services
to be performed.
(iii) Interest income Interest income is recognised on a time proportion basis using the effective interest rate method. When a receivable is impaired, the Group reduces the carrying
amount to its recoverable amount, being the estimated future cash flows discounted at the original effective interest rate of the instrument, and continues unwinding
the discount as interest income. Interest income on impaired loans is recognised using the original effective interest rate.
(iv) Rental income Rental income is recognised over the period of the lease on a straight-line basis.
(v) Dividend income Dividends are recognised when the right to receive payment is established.
24. FINANCE CHARGES
Finance charges comprise interest payable on borrowings calculated using the effective interest rate method. The interest expense component of finance lease payments is
recognised in profit or loss using the effective interest rate method.
Finance charges directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to
get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale.
25. LEASES
Leases that transfer substantially all the risks and rewards of ownership of the underlying asset to the Group are classified as finance leases. Assets acquired in terms
of finance leases are capitalised at the lower of fair value of the respective assets and the present value of the minimum lease payments at inception of the lease, and
depreciated over the estimated useful life of the asset. The capital element of future obligations under the leases is included as a liability in the statement of financial position.
Lease payments are allocated using the effective interest rate method to determine the lease finance cost, which is charged against income over the lease period, and the
capital repayment, which reduces the liability to the lessor.
Leases where the lessor retains the risks and rewards of ownership of the underlying asset are classified as operating leases. Operating leases, which have a fixed
determinable escalation, are charged against income on a straight-line basis. Leases with contingent escalations are expensed as and when incurred.
Accounting policies continuedfor the year ended June 30 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201465
26. EMPLOYEE BENEFITS
Short-term employee benefits The cost of short-term employee benefits (those payable within 12 months after the service is rendered, such as paid vacation leave, bonuses, and non-monetary benefits
such as medical care), are recognised in the period in which the service is rendered and are not discounted. The expected cost of compensated absences is recognised as
an expense as the employees render services that increase their entitlement or, in the case of non-accumulating absences, when the absences occur. The expected cost of
profit-sharing and bonus payments is recognised as an expense when there is a legal or constructive obligation to make such payments as a result of past performance.
Profit-sharing and bonus plans The Group recognises a liability and an expense for bonuses and profit-sharing, based on a formula that takes into consideration the profit attributable to the Group’s
shareholders after certain adjustments. The Group recognises an accrual where contractually obliged or where there is past practice that has created a constructive
obligation.
Defined contribution plans Payments to defined contribution retirement benefit plans are charged as an expense as they fall due.
Other post-employment obligations Certain companies in the Group provide post-retirement healthcare benefits to their retirees. The entitlement to these benefits is usually conditional on the employee
remaining in service up to retirement age and is applicable to employees employed prior to December 31 1998. The expected costs of these benefits are accrued over the
period of employment. The post-retirement value shown is the proportion of the total accrued liability as at the valuation date, assuming that the liability accrues uniformly
over the member’s working lifetime, where the total accrued liability is calculated as the discounted value of the expected benefits that become payable after retirement
based on the assumptions regarding the expected increase in medical aid premiums and the expected number of debts and withdrawals. The cost is actuarially determined.
Actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions are charged to other comprehensive income. The obligations are
valued annually by independent actuaries.
The Group’s obligation for post-retirement medical aid benefits to past and current employees is actuarially determined and provided for in full. The movement is recognised
through other comprehensive income.
Statutory termination obligations The statutory termination obligations are classified as a defined benefit and are payable on death, retrenchment and at retirement at age of 65. Severance pay payable upon
retirement at age of 65, as per the Labour Act, is applicable to the Group, as the employees have a normal retirement age of 65 in some of the entities. The obligation for
severance benefits is calculated in respect of all employees that qualify in terms of the Labour Act, and is provided for in full. The cost of providing the benefits is determined
using the projected unit credit method, with actuarial valuations being carried out at the end of each reporting period. The movement for the year is recognised in profit or
loss when it is incurred.
27. DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are accounted for once they have been approved by the board of directors.
28. SHARE-BASED PAYMENTS
The Bidvest Namibia Share Incentive Scheme grants options to acquire shares in the Company to executive directors and management. The fair value of options granted is
recognised as an employee expense with a corresponding increase in equity. The fair value is measured at grant date and spread over the period during which the employees
become unconditionally entitled to the options. The fair value of the options is measured using the Black-Scholes-Merton model, taking into account the terms and conditions
upon which the options were granted. The amount recognised as an expense is adjusted to reflect the actual number of share options that vest. At the end of each reporting
period, the Group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit
or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee benefits reserve.
29. BEE OWNERSHIP TRANSACTION
Equity instruments issued to a BEE partner at less than fair value are accounted for as share-based payments.
The difference between the fair value of the equity instruments issued and the consideration received is accounted for as an expense in profit or loss at the date the goods
and services are received, with a corresponding increase in equity. No service or other conditions exist for BEE partners. A restriction on the BEE partner to transfer the equity
instrument subsequent to its vesting is not treated as a vesting condition, but is factored into the fair value determination of the instrument.
The fair value is measured using the Monte Carlo option pricing valuation model. The valuation technique is consistent with generally acceptable valuation methodologies
for pricing financial instruments, and incorporates all factors and assumptions that knowledgeable willing participants would consider in setting the price of the equity
instrument.
30. HEADLINE EARNINGS PER SHARE
The Group presents headline earnings per share in accordance with the SAICA circular 2 of 2013.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201466
Statements of financial positionat June 30
Group Company
2014 2013 2014 2013
Notes NAD’000 NAD’000 NAD’000 NAD’000
ASSETS
Non-current assets
Property, plant and equipment 1 841 732 829 810 – –
Intangible assets 2 149 459 154 914 – –
Investment in subsidiaries 3 – – 363 377 363 377
Investment in joint venture 4 1 930 – – –
Long-term finance lease receivables 5 2 588 – – –
Deferred tax assets 12 9 450 8 952 – –
1 005 159 993 676 363 377 363 377
Current assets
Inventories 6 399 717 376 238 – –
Vehicle rental fleet 7 – 86 423 – –
Biological assets 8 1 951 759 – –
Short-term portion of finance lease receivables 5 5 311 – – –
Trade and other receivables 9 567 810 468 637 275 612 270 729
Current tax assets 25 2 559 – – –
Cash and cash equivalents 10 782 011 852 824 204 166 205 692
1 759 359 1 784 881 479 778 476 421
Total assets 2 764 518 2 778 557 843 155 839 798
EQUITY AND LIABILITIES
Capital and reserves attributable to equity holders
Share capital 11 2 120 2 120 2 120 2 120
Share premium 11 660 272 660 272 660 272 660 272
Other reserves 32 467 28 487 16 988 16 988
Retained earnings 913 707 816 588 163 537 160 183
1 608 566 1 507 467 842 917 839 563
Non-controlling interest in equity 3 456 596 451 580 – –
Total equity 2 065 162 1 959 047 842 917 839 563
Non-current liabilities
Deferred tax liabilities 12 214 210 210 319 – –
Post-employment obligations 13 16 433 14 757 – –
Operating lease liability 30 814 1 045 – –
Long-term finance lease liability 31 2 588 – – –
Trade and other payables 15 – 7 062 – –
234 045 233 183 – –
Current liabilities
Trade and other payables 15 452 192 551 538 217 199
Borrowings 16 1 872 22 159 – –
Short-term portion of finance lease liability 31 5 311 – – –
Provisions 14 – 1 124 – –
Current tax payable 25 5 936 11 506 21 36
465 311 586 327 238 235
Total liabilities 699 356 819 510 238 235
Total equity and liabilities 2 764 518 2 778 557 843 155 839 798
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201467
Group Company
Restated
2014 2013 2014 2013
Notes NAD’000 NAD’000 NAD’000 NAD’000
Continuing operations
Revenue 18 3 703 495 3 294 235 152 601 138 012
Cost of sales 18 (2 831 501) (2 444 316) – –
Gross profit 871 994 849 919 152 601 138 012
Administration expenses (387 601) (267 371) (1 305) (488)
Other income 19 14 651 16 549 – –
Share of profit of a joint venture 4 1 930 – – –
Operating profit 21 500 974 599 097 151 296 137 524
Finance income 22 18 566 17 472 633 929
Finance costs 23 (2 268) (1 782) – –
Profit before income tax 517 272 614 787 151 929 138 453
Income tax expense 25 (173 530) (188 496) (208) (316)
Profit for the year from continuing operations 343 742 426 291 151 721 138 137
Discontinued operations
Profit for the year from discontinued operations 35 – 214 – –
Profit for the year 343 742 426 505 151 721 138 137
Other comprehensive income
Actuarial losses on post-employment obligations 13 (269) – – –
Expiry of share options 10 – – –
Movement on translation of foreign subsidiary 5 590 17 450 – –
Total comprehensive income for the year 349 073 443 955 151 721 138 137
Profit attributable to:
Equity holders of the Company 245 745 274 596 151 721 138 137
Non-controlling interest 97 997 151 909 – –
343 742 426 505 151 721 138 137
Comprehensive income attributable to:
Equity holders of the Company 248 225 283 146 151 721 138 137
Non-controlling interest 100 848 160 809 – –
349 073 443 955 151 721 138 137
Basic earnings per share (cents) 28 115,94 129,56
Statements of profit or loss and other comprehensive incomefor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201468
Share
capital
Share
premium
Retained
earnings
NAD’000 NAD’000 NAD’000
Group
Balance at July 1 2012 2 120 660 272 675 522
Comprehensive income
Profit for the year – – 274 596
Other comprehensive income
Movement on translation of foreign subsidiary – – –
Total comprehensive income – – 274 596
Transactions with equity holders
Employee share option scheme – value of employee services – – –
Dividends declared and paid – – (133 530)
Total transactions with equity holders – – (133 530)
Balance at June 30 2013 2 120 660 272 816 588
Comprehensive income
Profit for the year – – 245 745
Other comprehensive income
Other comprehensive income for the year – – (269)
Total comprehensive income – – 245 476
Transactions with equity holders
Employee share option scheme – value of employee services – – –
Expiry of option grants – – 10
Dividends declared and paid – – (148 367)
Total transactions with equity holders – – (148 357)
Balance at June 30 2014 2 120 660 272 913 707
Company
Balance at July 1 2012 2 120 660 272 155 576
Comprehensive income
Profit for the year – – 138 137
Total comprehensive income – – 138 137
Transactions with equity holders
Dividend declared and paid – – (133 530)
Total transactions with equity holders – – (133 530)
Balance at June 30 2013 2 120 660 272 160 183
Comprehensive income
Profit for the year – – 151 721
Total comprehensive income – – 151 721
Transactions with equity holders
Dividend declared and paid – – (148 367)
Total transactions with equity holders – – (148 367)
Balance at June 30 2014 2 120 660 272 163 537
Statements of changes in equityfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201469
Attributable to equity holders of the parent
Foreign
currency
translation
reserve
Share-
based
payment
reserve
BEE share-
based
payment
reserve Total
Non-
controlling
interest
in equity
Total
equity
NAD’000 NAD’000 NAD’000 NAD’000 NAD’000 NAD’000
2 747 – 16 988 1 357 649 354 328 1 711 977
– – – 274 596 151 909 426 505
8 550 – – 8 550 8 900 17 450
8 550 – – 283 146 160 809 443 955
– 202 – 202 – 202
– – – (133 530) (63 557) (197 087)
– 202 – (133 328) (63 557) (196 885)
11 297 202 16 988 1 507 467 451 580 1 959 047
– – – 245 745 97 997 343 742
2 739 – – 2 470 2 851 5 321
2 739 – – 248 215 100 848 349 063
– 1 251 – 1 251 – 1 251
– (10) – – – –
– – – (148 367) (95 832) (244 199)
– 1 241 – (147 116) (95 832) (242 948)
14 036 1 443 16 988 1 608 566 456 596 2 065 162
– – 16 988 834 956 – 834 956
– – – 138 137 – 138 137
– – – 138 137 – 138 137
– – – (133 530) – (133 530)
– – – (133 530) – (133 530)
– – 16 988 839 563 – 839 563
– – – 151 721 – 151 721
– – – 151 721 – 151 721
– – – (148 367) – (148 367)
– – – (148 367) – (148 367)
– – 16 988 842 917 – 842 917
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201470
Group Company
2014 2013 2014 2013
Notes NAD’000 NAD’000 NAD’000 NAD’000
Cash flows from operating activities
Cash receipts from customers 3 597 783 3 246 503 – –
Cash paid to suppliers and employees (3 184 022) (2 660 920) (1 333) (314)
Cash generated/(absorbed) by operations 32 413 761 585 583 (1 333) (314)
Finance income 22 18 566 17 503 633 929
Finance costs (excluding post-retirement medical obligation) 23 (1 343) (3 507) – –
Dividends received 19 11 073 10 851 152 601 138 012
Dividends paid to equity holders 29 (148 367) (133 530) (148 367) (133 530)
Dividends paid to non-controlling interest (95 832) (63 557) – –
Income tax paid 33 (174 737) (184 983) (223) (417)
Net cash inflow from operating activities 23 121 228 360 3 311 4 680
Cash flows from investing activities
Disposal/acquisition of subsidiary 35 3 227 – – (4 013)
Acquisition of business – (17 500) – –
Vehicle rental fleet acquired 7 – (61 718) – –
Proceeds on disposal of vehicle rental fleet 7 – 9 555 – –
Intangible asset acquired 2 (1 442) (5 237) – –
Property, plant and equipment acquired 1 (82 294) (117 334) – –
Proceeds on disposal of property, plant and equipment 4 019 1 593 – –
Net cash outflow from investing activities (76 490) (190 641) – (4 013)
Cash flows from financing activities
Loans to related parties 9 – – (4 837) (3 914)
Net cash outflow from financing activities – – (4 837) (3 914)
Net (decrease)/increase in cash and cash equivalents (53 369) 37 719 (1 526) (3 247)
Foreign exchange differences 36 2 843 7 637 – –
Cash and cash equivalents
Balance at the beginning of the year 830 665 785 309 205 692 208 939
Cash and cash equivalents
Balance at the end of the year 10 780 139 830 665 204 166 205 692
Statements of cash flowsfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
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Land and Fishing Other
buildings vessels assets Total
NAD’000 NAD’000 NAD’000 NAD’000
1. PROPERTY, PLANT AND EQUIPMENT
1.1 GroupJune 30 2014
Opening net book amount 258 796 382 315 188 699 829 810
Exchange differences 1 753 59 1 025 2 837
Additions 7 865 12 501 61 928 82 294
On disposal of subsidiary (note 35) (8 202) – (516) (8 718)
Disposals (40) (1 610) (2 696) (4 346)
Depreciation (3 121) (5 683) (51 341) (60 145)
Closing net book amount 257 051 387 582 197 099 841 732
Cost 277 259 461 909 404 609 1 143 777
Accumulated depreciation (20 208) (74 327) (207 510) (302 045)
Closing net book amount 257 051 387 582 197 099 841 732
Group
June 30 2013
Opening net book amount 245 345 365 784 152 774 763 903
Exchange differences 6 238 311 6 186 12 735
Acquisition of business – – 1 231 1 231
Additions 9 513 26 876 80 945 117 334
Disposals – – (1 284) (1 284)
Transfers (170) – 170 –
Depreciation (2 130) (10 656) (51 323) (64 109)
Closing net book amount 258 796 382 315 188 699 829 810
Cost 275 020 455 013 368 770 1 098 803
Accumulated depreciation (16 224) (72 698) (180 071) (268 993)
Closing net book amount 258 796 382 315 188 699 829 810
1.2 Land and buildings A register of land and buildings is available for inspection at the registered office of the Company by members or their duly authorised representatives.
Office furniture/
equipment
Plant and and computer
machinery Vehicles equipment Total
NAD’000 NAD’000 NAD’000 NAD’000
1.3 Other assets consist of:GroupJune 30 2014
Opening net book amount 141 517 29 117 18 065 188 699
Exchange differences (223) 1 202 46 1 025
Additions 32 555 14 256 15 117 61 928
Disposals (1 377) (1 136) (183) (2 696)
On disposal of subsidiary (76) – (440) (516)
Depreciation charge for the year (36 326) (8 966) (6 049) (51 341)
Closing net book amount 136 070 34 473 26 556 197 099
Cost 270 942 71 905 61 762 404 609
Accumulated depreciation (134 872) (37 432) (35 206) (207 510)
Closing net book amount 136 070 34 473 26 556 197 099
Notes to the financial statementsfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201472
Office furniture/
equipment
Plant and and computer
machinery Vehicles equipment Total
NAD’000 NAD’000 NAD’000 NAD’000
1. PROPERTY, PLANT AND EQUIPMENT (continued)
1.3 Other assets consist of: (continued)
GroupJune 30 2013
Opening net book amount 106 237 30 399 16 138 152 774
Exchange differences 5 985 130 70 6 185
Acquisition of subsidiaries 5 1 138 88 1 231
Additions 67 212 5 736 7 999 80 947
Disposals (235) (822) (228) (1 285)
Transfers 168 – 2 170
Depreciation charge for the year (37 855) (7 464) (6 004) (51 323)
Closing net book amount 141 517 29 117 18 065 188 699
Cost 251 608 64 506 52 656 368 770
Accumulated depreciation (110 091) (35 389) (34 591) (180 071)
Closing net book amount 141 517 29 117 18 065 188 699
Computer Fishing
Goodwill software rights Total
NAD’000 NAD’000 NAD’000 NAD’000
2. INTANGIBLE ASSETS
2.1 GroupJune 30 2014
Opening net book amount 119 825 5 433 29 656 154 914
Adjustment of working capital values at acquisition (907) – – (907)
Exchange differences – – 1 131 1 131
Impairment – (12) – (12)
Additions – 1 442 – 1 442
Amortisation – (1 719) (5 390) (7 109)
Closing net book amount 118 918 5 144 25 397 149 459
Cost 118 918 11 216 65 756 195 890
Accumulated amortisation – (6 072) (40 359) (46 431)
Closing net book amount 118 918 5 144 25 397 149 459
GroupJune 30 2013
Opening net book amount 102 057 1 356 29 247 132 660
Exchange differences – – 5 356 5 356
Acquisition of subsidiaries 17 768 – – 17 768
Additions – 5 238 – 5 238
Amortisation – (1 161) (4 947) (6 108)
Closing net book amount 119 825 5 433 29 656 154 914
Cost 119 825 11 010 63 460 194 295
Accumulated amortisation – (5 577) (33 804) (39 381)
Closing net book amount 119 825 5 433 29 656 154 914
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201473
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
2. INTANGIBLE ASSETS (continued)
2.2 Goodwill allocationGoodwill is allocated to the Group’s cash-generating units (CGUs) identified
according to the operating segment. An operating segment-level summary
of the goodwill allocation is presented below:
Fishing 21 595 21 595 – –
Freight and Logistics 40 228 41 924 – –
Food and Distribution 49 913 50 820 – –
Industrial and Commercial Products 606 619 – –
Properties 1 709 – – –
Services 4 867 4 867 – –
118 918 119 825 – –
Due to restructuring in the Group, goodwill has been reallocated to the
Properties subgroup.
2.3 Goodwill impairment testsThe recoverable amount of a CGU is determined based on value-in-use
calculations. These calculations use pre-tax cash flow projections based
on budgets approved by management covering a four-year period. Cash
flows beyond the four-year period are extrapolated using the growth rates
as stated below:
All segments
Growth rate 6% – 8% 6% – 8%
Growth in perpetuity after forecast period 6% – 8% 6% – 10%
Internal rate of return (WACC)/discount rate 11% 11%
3. INVESTMENT IN SUBSIDIARIES
Unlisted share investment
Bidvest Namibia Fisheries Holdings (Pty) Limited 359 363 359 363
Bidvest Namibia Commercial Holdings (Pty) Limited – –
Bidvest Namibia Management Services (Pty) Limited – –
Bidvest Namibia Information Technology (Pty) Limited – –
Bidvest Namibia Property Holdings (Pty) Limited 4 014 4 014
363 377 363 377
The carrying amounts of subsidiaries are shown net of impairment losses. For more information on the subsidiary undertakings refer to the directors’ report.
Composition of the GroupPlace of
incorporation
and operationSegments
Number of wholly owned subsidiaries
2014 2013
Fishing Walvis Bay 14 14
Freight and Logistics Walvis Bay 6 6
Services Windhoek 2 3
Industrial and Commercial Products Windhoek 4 4
Food and Distribution Windhoek 4 5
Corporate Services Windhoek 6 5
Number of non-wholly owned
subsidiaries
Segments 2014 2013
Fishing Walvis Bay 6 6
Freight and Logistics Walvis Bay 1 1
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201474
Proportion of
non-controlling
interests
%
Profit/(loss) allocated to
non-controlling interests
Accumulated non-controlling
interests
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
3. INVESTMENT IN SUBSIDIARIES (continued)
Details of non-wholly owned subsidiaries that have material
non-controlling interests
Name of subsidiary
Namsov Fishing Enterprises (Pty) Limited 30,45 74 729 92 533 315 221 293 962
Pesca Fresca Limitada 65,92 (7 328) 19 938 45 530 52 858
Trachurus Fishing (Pty) Limited 57,91 32 701 48 254 89 831 99 408
Twafika Fishing Enterprises (Pty) Limited 47,77 154 364 711 640
Walvis Bay Stevedoring Company (Pty) Limited 45,00 591 (281) 5 303 4 712
Oshivelelwa Trading Enterprises (Pty) Limited 50,00 – – 0 0
456 596 451 580
The Group has de facto control over Pesca Fresca Limitada as a result of the management agreement.
Proportion of ownership interest
2014 2013 2014 2013
4. INVESTMENT IN JOINT VENTURE
Name of joint venture
!OE#GAB Fishing Enterprises (Pty) Limited 50% 50%
NAD’000 NAD’000
The Group’s share of profit from continuing operations 1 930 – – –
Carrying amount of the Group’s interest in joint venture 1 930 – – –
The above financial information have been equity accounted in the Group’s results. The joint venture is not material to the Group.
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
5. FINANCE LEASE RECEIVABLES
Gross finance lease receivable
– within one year 5 311 – – –
– in second to fifth year inclusive 2 588 – – –
Amounts receivable under finance leases 7 899 – – –
Less: Unearned finance income (625) – – –
Present value of finance lease receivables 7 274 – – –
Non-current assets 2 588 – – –
Current assets 5 311 – – –
7 899 – – –
Minolco (Namibia) (Pty) Limited signed an agreement with Standard Bank Namibia Limited to cede the rights relating to rental agreements signed between Minolco (Namibia)
(Pty) Limited and customers to Standard Bank Namibia Limited while maintaining the service obligations related thereto. The average lease period is two to three years and
the average effective borrowing rate is the prime interest rate.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201475
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
6. INVENTORIES
Finished goods 360 640 311 631 – –
Parts and accessories 44 692 68 555 – –
405 332 380 186 – –
Less: Provision for obsolete inventory (5 615) (3 948) – –
399 717 376 238 – –
Carrying value of inventory at net realisable value (included above) 9 596 8 430 – –
In the prior year inventory included fishmeal valued at NAD9,6 million which was
restricted from being exported from Angola. During the current financial year the
restriction was lifted and the fishmeal was exported.
7. VEHICLE RENTAL FLEET
Opening balance 86 423 45 093 – –
Additions – 61 718 – –
Disposals – (9 555) – –
On disposal of subsidiary (note 35) (86 423) – – –
Depreciation – (10 833) – –
Vehicle rental fleet – 86 423 – –
8. BIOLOGICAL ASSETS
Opening balance 759 2 293 – –
Value changes caused by:
Birth and growth of animals 5 675 2 247 – –
Increase due to purchases 1 425 520 – –
Mortalities (2 249) (1 185) – –
Samples/donations (3) (15) – –
Change in fair value due to price changes 126 19 – –
Decrease due to sales (3 782) (3 120) – –
Oysters 1 951 759 – –
Current 1 951 759 – –
Biological assets consist of oysters.
The Group is exposed to a number of risks relating to its growing of oysters arising
from environmental and climatic changes, toxic algae blooms and other contamination
of water space. The Group has extensive processes in place to monitor and mitigate
these risks.
9. TRADE AND OTHER RECEIVABLES
Trade receivables – third parties 387 596 285 190 – –
Trade receivables – related parties (note 37) 1 884 491 – –
Less: Allowance for impairment (8 330) (10 213) – –
381 150 275 468 – –
Related-party loans(i) (note 37) – – 275 517 270 680
Prepayments 59 661 35 192 – –
Receiver of revenue – VAT 74 411 71 704 – –
Other receivables 87 396 86 273 95 49
Less: Allowance for impairment (34 808) – – –
567 810 468 637 275 612 270 729
(i) These related-party accounts are unsecured, interest free and are repayable on demand.
Trade receivables are provided for based on estimated irrecoverable amounts from the sale of goods or rendering of services, determined by reference to past default
experience.
Included in the Group’s trade receivables balance are debtors with a carrying amount of NAD71,3 million (2013: NAD43,1 million) which were past due at the reporting date
but not impaired. The Group has not provided for these as there has not been a significant change in credit quality.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201476
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
9. TRADE AND OTHER RECEIVABLES (continued)
The ageing of amounts past due but not impaired is as follows:
Past due 0 – 30 days 47 838 30 787 – –
Past due 31 – 90 days 14 116 6 877 – –
Past due 91 – 180 days 3 728 3 281 – –
Past due 181+ days 5 616 2 191 – –
71 298 43 136 – –
Movement in the Group’s provision for impairment of trade receivables are as follows:
Balance at the beginning of the year (10 213) (11 451) – –
Net provisions raised during the year (58) (61) – –
Bad debts written off during the year 1 567 1 299 – –
On disposal of business 374 – – –
(8 330) (10 213) – –
In determining the recoverability of a trade receivable, the Group considers any change in the credit quality of the trade receivable from the date credit was initially granted
up to the reporting date.
No trade receivables were placed under liquidation during the year (2013: NAD0,374 million)
At June 30 2014 the carrying amounts of accounts receivable approximate their fair values due to the short-term maturities of these assets.
Trade and other receivables amounting to NAD166,3 million (2013: NAD122,2 million) serve as collateral for bank overdraft facilities of NAD37,35 million
(2013: NAD37,35 million). At year-end NAD1,9 million (2013: NAD22 million) of the bank overdraft facility was utilised. Refer to note 10.
Other receivables amounting to NAD13,6 million are reflected as a receivable at year-end in respect of the excessive purchased in quota costs. Management has impaired
this receivable as it regards it as doubtful. In addition, other receivables include an amount of NAD21,2 million, which has been fully impaired, relating to assets removed by
the interim management of Pesca Fresca Limitada during the period in which they had assumed the role of management of that company.
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
10. CASH AND CASH EQUIVALENTS
For the purposes of the statement of cash flows, the year-end cash and cash
equivalents comprise the following:
Bank and cash balances 571 163 655 893 6 366 18 144
Money market funds
Bank Windhoek Corporate Fund 104 037 95 654 90 989 86 271
Old Mutual Unit Trust Corporate Fund 106 811 101 277 106 811 101 277
782 011 852 824 204 166 205 692
Bank overdraft (note 16) (1 872) (22 159) – –
Cash and cash equivalents 780 139 830 665 204 166 205 692
The bank overdraft facilities are secured by an unlimited suretyship and by a cession of trade and other receivables (refer to note 9). The total credit facilities of the Group
consist of overdraft facilities of NAD133,1 million (2013: NAD133,1 million) (refer to note 38.1(c) liquidity risk for detail on the overdraft facilities).
The money market funds can be converted to cash within a notice period of 24 hours.
At June 30 2014, the carrying amounts of cash and cash equivalents approximate the fair values due to their short-term maturities.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201477
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
11. SHARE CAPITAL, PREMIUM AND RESERVES
Share capital
Authorised share capital
540 000 000 ordinary shares of NAD0,01 each 5 400 5 400 5 400 5 400
Issued share capital
Number of shares issued 2 120 2 120 2 120 2 120
Balance at beginning of year 2 120 2 120 2 120 2 120
Shares issued during the year – – – –
Issued share capital 2 120 2 120 2 120 2 120
The unissued ordinary shares are under the control of the directors until the next
annual general meeting.
Share premium
Opening balance 660 272 660 272 660 272 660 272
Issued during the year – – – –
Closing balance 660 272 660 272 660 272 660 272
12. DEFERRED TAX ASSETS/(LIABILITIES)
Deferred taxation assets 9 450 8 952 – –
Deferred taxation liabilities (214 210) (210 319) – –
(204 760) (201 367) – –
Movement in deferred tax balances:
Opening balance (201 367) (208 315) – –
Disposal of subsidiary 3 699 409 – –
Per statement of comprehensive income (temporary differences) (7 092) 6 539 – –
Closing balance (204 760) (201 367) – –
Assets
NAD’000
Liabilities
NAD’000
Net
NAD’000
Tax effect of temporary differences – 2014
Capital allowances on property, plant and equipment (3 875) (197 897) (201 772)
Capital allowances on intangible assets (179) (705) (884)
Computed tax losses 12 883 15 566 28 449
Trade and other receivables (116) (23 380) (23 496)
Trade, other payables and provisions 25 183 208
Staff-related allowances and liabilities 594 5 050 5 644
Inventory related (201) (12 656) (12 857)
Operating lease liabilities 318 76 394
Other 1 (447) (446)
Net temporary differences subject to deferred tax 9 450 (214 210) (204 760)
Tax effect of temporary differences – 2013
Capital allowances on property, plant and equipment (3 133) (196 871) (200 004)
Capital allowances on intangible assets (122) (1 058) (1 180)
Capital allowances on vehicle rental fleet – (7 969) (7 969)
Computed tax losses 12 548 17 039 29 587
Trade and other receivables (376) (9 818) (10 194)
Trade, other payables and provisions 86 4 90
Staff-related allowances and liabilities 349 4 437 4 786
Inventory related (38) (15 217) (15 255)
Temporary difference on which no deferred tax asset was raised (804) – (804)
Operating lease liabilities 442 (65) 377
Other – (801) (801)
Net temporary differences subject to deferred tax 8 952 (210 319) (201 367)
Deferred income taxes are calculated on all temporary differences under the liability method using a tax rate of 33% (2013: 33%).
Deferred income tax assets are recognised for tax loss carry-forwards to the extent that the realisation of the related tax benefit through future taxable profits is probable.
The Group did not recognise deferred income tax assets of NAD2,2 million (2013: NAD0,8 million) in respect of losses amounting to NAD6,7 million (2013: NAD2,4 million).
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201478
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
13. POST-EMPLOYMENT OBLIGATIONS
Total liability recognised in the statement of financial position:
Post-retirement medical benefit obligation 12 720 12 025 – –
Statutory severance benefits 3 713 2 732 – –
16 433 14 757 – –
13.1 Post-retirement medical benefit obligationOpening balance 12 025 11 467 – –
Imputed interest costs 925 975 – –
Payments to medical aid in respect of retired employees (673) (586) – –
Actuarial losses 269 44 – –
Current service cost 174 125 – –
Actuarially determined present value of total obligation 12 720 12 025 – –
Certain companies in the Group provide post-retirement medical benefit subsidies to certain retired employees and are responsible for provision of post-retirement medical
benefit subsidies to a limited number of current employees.
During June 2014 a valuation was performed by Towers Watson, independent actuaries.
The post-retirement value shown is the proportion of the total accrued liability as at the valuation date, assuming that the liability accrues uniformly over the member’s working
lifetime, where the total accrued liability is calculated as the discounted value of the expected benefits that become payable after retirement based on the assumptions
regarding the expected increase in medical aid premiums and the expected number of deaths and withdrawals. The following key actuarial assumptions were used:Group Company
2014 2013 2014 2013
Discount rate 8,60% 7,2% – 7,63% – –
Healthcare cost inflation 8,20% 5,63% – 5,7% – –
Mortality rate
Mortality before retirement has been based on the SA 85-90 mortality table and on the PA(90) ultimate mortality table adjusted less one year of age for post-retirement
medical benefits.
The post-retirement medical benefit obligation is based on the assumption that the required contributions to the medical aid scheme will increase at a faster rate than the
normal inflation rate. The discount rate and the healthcare cost inflation assumptions should be considered in relation to each other.
The sensitivity of the liability is illustrated on the assumption of a 1% increase/decrease in the healthcare cost and consumer price inflation compared to the valuation
assumptions keeping the investment return assumption constant:
Sensitivity – Group NAD’000
% change in
liability
Base liability as at June 30 2014 12 720
Discount rate +1% 11 341 (11%)
Discount rate -1% 14 405 13%
Medical subsidy inflation rate +1% 14 416 13%
Medical subsidy inflation rate -1% 11 309 (11%)
Post-retirement mortality PA(90) – 3 years 13 175 4%
Post-retirement mortality PA(90) – 1 year 12 271 (4%)
Group
2014 2013
Current employees 15 20
Retirees 30 27
Total number of beneficiaries 45 47
This benefit is available to all employees employed prior to December 31 1998 for Manica Group Namibia (Pty) Limited and its subsidiaries and Rennies Travel (Namibia)
(Pty) Limited. The benefit is available to all employees employed prior to 2004 by Taeuber & Corssen SWA (Pty) Limited and its subsidiaries, except for those to whom the
liability has been paid out in cash.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201479
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
13. POST-EMPLOYMENT OBLIGATIONS (continued)
13.2 Statutory severance benefitsLiability recognised in statement of financial position:
Defined benefit obligation 3 713 2 732 – –
Changes in the present value of the defined statutory severance benefit
obligation are as follows:
Opening defined benefit obligation 2 732 1 998 – –
Total expense – as shown below 1 438 734 – –
Benefit payments (457) – – –
Closing defined benefit obligation 3 713 2 732 – –
The amounts recognised in the statement of comprehensive income are as follows:
Interest cost 208 38 – –
Actuarial loss (1 772) (892) – –
Current service cost 3 002 1 588 – –
The principal actuarial assumptions used for accounting purposes are:
Discount rate 10,05% 9,33% n/a n/a
Salary increase rate 6% 6% n/a n/a
14. PROVISIONS
Provision for distributions to trust beneficiaries – 1 124 – –
Analysed as:
Current – 1 124 – –
– 1 124 – –
Reconciliation of provision
Balance at July 1 2013 1 124 5 537 – –
Utilised during the year (1 124) (4 413) – –
– 1 124 – –
15. TRADE AND OTHER PAYABLES
Trade payables – third parties 318 824 324 602 – –
Trade payables – related parties (note 37) 16 479 19 352 – –
Loans from related parties(i) (note 37) – 90 458 – –
Accruals 93 964 87 860 199 –
Unpresented cheques 6 550 25 741 18 199
Customer deposits 11 109 6 554 – –
Receiver of revenue – VAT 5 266 4 033 – –
452 192 558 600 217 199
Current portion 452 192 551 538 217 199
Non-current portion – 7 062 – –
452 192 558 600 217 199
(i) Loans from related parties are unsecured, are repayable on demand and carry interest equivalent
to the South African prime rate.
At June 30 2014, the carrying amounts of accounts payable approximate their fair
values due to the short-term maturities of these liabilities.
16. BORROWINGS
Bank overdraft (note 10) 1 872 22 159 – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201480
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
17. CONTINGENCIES AND COMMITMENTS
Capital commitments
The following commitments were entered into in respect of capital expenditure at
year-end:
Approved by directors and contracted 5 094 12 356 – –
Approved by directors but not yet contracted 68 305 48 628 – –
The committed expenditure relates to property, plant and equipment and will be
financed by available resources and bank facilities.
Contingent liabilities
Woker Freight Services (Pty) Limited, a subsidiary of Manica Group Namibia
(Pty) Limited, has issued a guarantee for bond facilities to the Ministry of Finance,
Department of Customs and Excise of NAD25 million. The Department of Customs
and Excise has currently recorded a liability of NAD7 million against the bond of Woker
Freight Services (Pty) Limited in respect of a consignment which has incorrectly been
handled by the Woker Freight Services’ client (the exporter) resulting in complications
with the export documentation. There is uncertainty as to the liability of Woker Freight
Services (Pty) Limited in respect of this consignment. It is uncertain when and if this
contingent liability will materialise. The directors believe, based on legal advice, that
the action can be successfully defended and therefore no losses (including costs) will
be incurred.
Guarantees by third parties
Guarantee facilities have been arranged for the Group with Standard Bank Namibia
Limited and Nedbank Namibia Limited to a maximum exposure of:
62 366 58 162 500 500
Guarantees in favour of:
Customs and Excise 51 773 46 773 – –
Maersk (Pty) Limited 650 650 – –
Erongo Regional Electricity Distributor 148 148 – –
Philip Morris South Africa (Pty) Limited 3 100 3 100 – –
Namibian Ports Authority 6 300 6 300 – –
Other 395 1 191 500 500
62 366 58 162 500 500
Most of the facilities above have been secured by interlinking suretyships provided by
the Group and its subsidiaries restricted to the amount of the limit allocated to each
subsidiary.
18. REVENUE
Continuing operations
Sale of goods 3 347 232 3 027 550 – –
Rendering of services 291 735 215 276 – –
Dividend income – subsidiaries – – 142 349 127 695
Dividend income – local – – 10 252 10 317
Commissions and fees earned 64 528 51 409 – –
3 703 495 3 294 235 152 601 138 012
Revenue is derived as follows:
Revenue including disbursements 3 980 883 3 536 406 – –
Disbursements on behalf of principals and clients (277 388) (242 171) – –
3 703 495 3 294 235 – –
Related cost of sales:
Sale of goods 2 572 038 2 273 754 – –
Rendering of services 242 149 156 010 – –
Commissions and fees earned 17 314 14 552 – –
2 831 501 2 444 316 – –
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201481
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
19. OTHER INCOME
Continuing operations
(Loss)/profit on disposal of property, plant and equipment (327) 307 – –
Dividend income – local 11 073 10 851 – –
Other 3 905 5 391 – –
14 651 16 549 – –
20. BEE SHARE-BASED PAYMENT RESERVE
The BEE ownership transaction charge is recognised as the difference of the net value
of the consideration received and the net value of shares issued. 16 988 16 988 16 988 16 988
During the 2010 financial year The Bidvest Group Limited concluded agreements
with the BEE partners to facilitate the acquisition of an effective interest of 15,46%
in Bidvest Namibia Limited. The BEE groups are Endeni Investments (Pty) Limited
(0,66%) and Ovanhu Investments (Pty) Limited (14,80%). The transaction was valued
at NAD207 360 000 and was financed by the issue of NAD170 969 834 class A and
NAD42 742 460 class B preference shares and a loan from Bid Industrial Holdings
(Pty) Limited. The fair value recognised at the grant date was NAD16 987 708 and was
determined using the Monte Carlo simulation.
Equity-settled share-based payment reserve
The equity-settled share-based payment reserve includes the fair value of the options
granted and conditional share awards made, to executive directors and staff, which
have been recognised over the vesting period at fair value with a corresponding expense
in profit or loss. 1 443 202 – –
21. OPERATING PROFIT
Operating profit from continuing operations is stated after charging:
Auditors’ remuneration
Audit fees 7 401 6 154 – –
Other services 235 231 – –
7 636 6 385 – –
Share-based payments 1 251 202 – –
Consulting services on potential acquisitions – 366 – –
Depreciation and impairment of property, plant and equipment 60 145 64 109 – –
Depreciation of vehicle rental fleet – 10 833 – –
Amortisation and impairment of intangible assets 7 121 6 108 – –
Statutory severance benefits – current service cost 3 002 1 588 – –
Actuarial loss on post-retirement medical obligation 269 44 – –
Non-executive directors compensation
Attendance fees 1 110 1 009 – –
Operating lease charges
Premises 14 284 15 756 – –
Equipment and vehicles 7 892 16 376 – –
22 176 32 132 – –
Foreign exchange gains
Realised (14 060) (16 720) – –
Unrealised 1 137 (15 860) – –
(12 923) (32 580) – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201482
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
21. OPERATING PROFIT (continued)
Expenses by nature
Administrative fees 3 182 6 604 – –
Auditors’ remuneration 7 636 6 385 – –
Bad debts written off 1 567 1 299 – –
Inventory, materials and consumables 1 561 582 1 360 784 – –
Depreciation, amortisation and impairments 67 266 81 050 – –
Non-executive directors’ attendance fees 1 110 1 009 – –
Employee salaries and related benefits 550 960 483 638 – –
Foreign exchange gains (12 923) (32 580) – –
Fuel and lubricants for fishing vessels 246 781 219 524 – –
Operating lease charges 22 176 32 132 – –
Other expenses 444 543 287 396 1 305 488
Port-related costs, cold storage costs 52 932 35 567 – –
Quota-related fees 272 110 286 743 – –
Royalties paid 180 180 – –
Less: Cost of sales and administration expenses from discontinued operation (note 35) – (58 044) – –
Total cost of sales and administration expenses by nature 3 219 102 2 711 687 1 305 488
22. FINANCE INCOME
Continuing operations
Interest income – bank 17 713 17 151 324 505
– other 853 321 309 424
18 566 17 472 633 929
23. FINANCE COSTS
Continuing operations
Interest expense – bank borrowings – 43 – –
– bank overdraft 658 736 – –
– post-retirement medical obligation 925 975 – –
– other 685 28 – –
2 268 1 782 – –
24. STAFF AND RETIREMENT BENEFIT COSTS
Salaries and wages paid to employees 524 733 459 520 – –
Employer contribution to retirement benefits of current employees 26 227 24 118 – –
550 960 483 638 – –
At June 30 2014 approximately 3 239 (2013: 3 203) staff members were employed
by the Group.
25. INCOME TAX
Continuing operations
Namibian normal tax
Current income tax – current year 166 438 195 035 208 316
– prior year – – – –
166 438 195 035 208 316
Deferred income tax – current year 7 092 (575) – –
– prior year – 26 – –
– change in rate – (5 990) – –
7 092 (6 539) – –
173 530 188 496 208 316
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201483
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
25. INCOME TAX (continued)
Reconciliation of the tax expense
Reconciliation between applicable tax charge and profit before tax:
Profit before tax from continuing operations 517 272 614 787 151 929 138 453
Tax at the applicable tax rate of 33% (2013: 34%) 170 700 209 028 50 137 47 074
Exempt income (12 382) (17 581) (50 358) (46 924)
Prior period adjustment – 25 – –
Non-deductible expenses 12 989 2 186 430 166
Change in tax rate – (5 990) – –
Deferred tax asset not raised 2 223 828 – –
173 530 188 496 208 316
INCOME TAX ASSETS AND LIABILITIES
Current tax assets
Tax refunds receivable 2 559 – – –
Current tax liabilities
Income tax payable 5 936 11 506 21 36
26. RETIREMENT BENEFIT INFORMATION
Retirement fund
The total value of contributions to the Bidvest Namibia Limited Retirement Fund during
the year amounted to:
Members’ contributions 15 042 11 627 – –
Employer contributions 26 227 21 167 – –
41 269 32 794 – –
This is a defined contribution plan fund and is regulated by the Pension Fund Act.
The fund is valued actuarially on an annual basis. The fund was last valued at
June 30 2014 and its assets were found to exceed its actuarially calculated liabilities.
The total value of contributions to the Taeuber & Corssen SWA Retirement Fund during
the year amounted to:
Members’ contributions – 1 301 – –
Employer contributions – 2 951 – –
– 4 252 – –
Medical aid funds
Total value of company contributions during the year 18 078 17 633 – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201484
27. SHARE-BASED PAYMENTS
The Bidvest Namibia Share Incentive Scheme, which was approved at the annual general meeting in 2012, grants options to executive directors and management of the
Group to acquire shares in the Company at a fixed price. Options vest in tranches and expire after 10 years. The share option scheme has been classified as an equity-settled
scheme, and therefore an equity-settled share-based payment reserve has been recognised.
Each employee share option converts into one ordinary share of the Company on exercise. No amounts are paid or payable by the recipient on receipt of the option. The
options carry no rights to dividends nor voting rights. Options may be exercised at any time from the date of vesting to the date of their expiry.
No options have been exercised during the current financial year.
The number and weighted average exercise prices of share options granted are:
Group
2014
Number Average price
Beginning of the year 2 015 000 11,30
Granted – –
Lapsed – –
Exercised – –
End of year 2 015 000 11,30
The options outstanding at June 30 2014 have an exercise price of NAD11,30 (2013: NAD11,30) and a contractual life of 10 years. The average share price of Bidvest
Namibia Limited during the year was NAD12,61 (2013: NAD12,23). Options vest in three tranches on the third, fourth and fifth year’s anniversaries respectively from the
initial grant date. Options lapse upon the termination of an option holder’s employment in the Group.
Options were granted on May 22 2013 and were priced using the Black-Scholes-Merton Model.
Inputs to the model:
Grant date share price NAD12,55
Exercise price NAD11,30
Expected volatility 45%
Option life 5 – 10 years
Dividend yield 5,04
Risk-free interest rate 6,00% – 6,75%
Group Company
2014 2013 2014 2013
’000 ’000 ’000 ’000
28. EARNINGS PER SHARE
Weighted average number of shares
Weighted average number of shares in issue for basic earnings per share and headline
earnings per share: 211 953 211 953 – –
No adjustments to the weighted average number of shares were considered necessary
as outstanding staff share options do not have a dilutive effect.
NAD’000 NAD’000 NAD’000 NAD’000
Attributable earnings
Basic earnings per share are based on profit attributable to equity holders of
the Company. 245 745 274 596 – –
Basic earnings per share (cents) 115,94 129,56 – –
Headline earnings
Profit attributable to equity holders of the Company 245 745 274 596 – –
Profit/(loss) on the disposal of property, plant and equipment 372 (207) – –
Impairment of intangible assets 8 – – –
Non-controlling interest in equity (284) (2) – –
245 841 274 387 – –
Headline earnings per share (cents) 115,99 129,46 – –
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201485
29. DIVIDENDS
An interim dividend for the year amounting to NAD50,9 million (2013: NAD48,7 million) was declared and paid to shareholders registered on March 14 2014. This amounted
to an interim dividend paid of 24,0 cents per share, based on ordinary shares in issue of 211 953 002.
A final dividend amounting to NAD82,7 million (2013: NAD97,5 million) was declared payable to shareholders registered on September 12 2014, payable on
September 26 2014. This amounts to a final dividend payable of 39,0 cents per share, based on ordinary shares in issue of 211 953 002.
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
30. OPERATING LEASES
The Group has entered into various operating lease agreements in respect of premises.
Leases which have fixed determinable escalations are charged to profit or loss on a
straight-line basis and liabilities are raised for the difference between the actual lease
expense and the charge recognised in profit or loss. The liabilities are classified based
on the timing of the reversal which will occur when the actual cash flow exceeds the
income statement amounts.
Operating lease liability 1 193 1 144 – –
Less: Current portion included in trade and other payables (379) (99) – –
Non-current portion 814 1 045 – –
Operating lease commitments
At year-end, the Group had outstanding commitments for future minimum lease
payments under non-cancellable operating leases, which fall due as follows:
Land and buildings
Due within one year 18 474 12 905 – –
Due between one year and five years 17 088 21 906 – –
Due thereafter 2 883 2 749 – –
38 445 37 560 – –
Equipment
Due within one year 71 63 – –
Due between one year and five years 4 262 2 705 – –
4 333 2 768 – –
Exposure 42 778 40 328 – –
31. FINANCE LEASE LIABILITY
Minimum lease payments due
Due within one year 5 731 – – –
Due between one year and five years 2 793 – – –
8 524 – – –
Less: Future finance charges (625) – – –
Present value of minimum lease payments 7 899 – – –
Non-current liabilities 2 588 – – –
Current liabilities 5 311 – – –
7 899 – – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201486
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
32. CASH GENERATED/(ABSORBED) BY OPERATIONS
Profit before tax from continuing operations 517 272 614 787 151 929 138 452
Profit before tax from discontinuing operations – 38 – –
517 272 614 825 151 929 138 452
Adjustments for:
Depreciation and impairment on property, plant and equipment 60 145 64 109 – –
Depreciation on vehicle rental fleet – 10 833 – –
Amortisation and impairment of intangible assets 7 121 6 108 – –
Share-based payment expense 1 251 202 – –
Loss/(profit) on disposal of property, plant and equipment 327 (309) – –
Adjustment of goodwill 907 – – –
Finance income (18 566) (17 503) (633) (929)
Dividends received (11 073) (10 851) (152 601) (138 012)
Finance costs (excluding retirement medical obligation) 1 343 3 507 – –
Increase in statutory severance obligation 981 734 – –
(Decrease)/increase in post-retirement medical obligation (499) (417) – –
Interest on post-retirement medical obligation 925 975 – –
Decrease in provisions (1 124) (4 413) – –
Movement in joint venture (1 930) – – –
Increase in lease charges for straightlining of leases 202 367 – –
Changes in working capital (excluding the effects of business acquisitions
and disposals and exchange rate differences):
Inventories (23 150) (46 431) – –
Biological assets (1 192) 1 534 – –
Loans from related parties (note 15) – 68 869 – –
Trade and other receivables (105 712) (47 732) (46) (2)
Trade and other payables (13 467) (58 824) 18 177
413 761 585 583 (1 333) (314)
33. INCOME TAX PAID
Balance at the beginning of the year (11 506) (1 221) (36) (137)
Current tax for the year (166 438) (195 268) (208) (316)
Tax liability on disposal of subsidiary (note 35) (170) – – –
Balance at the end of the year 3 377 11 506 21 36
(174 737) (184 983) (223) (417)
34. NON-CASH FLOW MOVEMENT
Movement in joint venture 1 930 – – –
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201487
35. DISPOSAL OF SUBSIDIARY – GROUP
The Group disposed of Budget Rent a Car (Pty) Limited to Bid Services Division (Pty) Limited on July 1 2013.
The assets and liabilities disposed at fair value were: NAD’000
Property, plant and equipment 8 718
Vehicle rental fleet 86 423
Cash and cash equivalents 1 086
Taxation asset 170
Inventories 723
Trade and other receivables 7 631
Inter-company loan account (90 458)
Deferred tax liability (3 699)
Operating lease liability (433)
Trade and other payables (5 849)
Net assets disposed of 4 313
Less: Cash and cash equivalents balance disposed of (1 086)
Net cash inflow on disposal of subsidiary 3 227
Gain/(loss) on disposal of subsidiary
Consideration received 4 313
Net assets disposed of (4 313)
–
Analysis of profit for the year from discontinued operation
The results and the comparative profit and cash flows of the discontinued operation, Budget Rent a Car (Pty) Limited, are set out below.
Profit for the year from discontinued operation
2014 2013
NAD’000 NAD’000
Revenue – 60 752
Cost of sales – (43 985)
Gross profit – 16 767
Operating expenses – (14 060)
Operating profit – 2 707
Net finance charges – (2 669)
Profit before income tax – 38
Taxation – 176
Profit for the year – 214
Cash flows
Net cash outflows from operating activities – (1 922)
Net cash outflows from investing activities – (53 065)
Net cash inflows from financing activities – 55 396
Net cash inflows – 409
36. EFFECTS OF EXCHANGE RATE FLUCTUATIONS ON CASH AND CASH EQUIVALENTS – GROUP
Property, plant and equipment (2 837) (12 735)
Intangibles (1 131) (5 356)
Movement in foreign currency translation reserve 2 739 8 550
Minority shareholders 2 851 8 899
Trade and other receivables (1 092) (3 402)
Inventories (1 052) (3 692)
Trade and other payables 3 365 15 373
2 843 7 637
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201488
37. RELATED PARTY BALANCES AND TRANSACTIONS
Relationships
During the year the Group, in the ordinary course of business, entered into various sale and purchase transactions with its holding company and all other related parties.
The transactions occurred under terms that are negotiated between the parties.
The following parties are included as related parties:
The Company is controlled by The Bidvest Group Limited, a company registered in the Republic of South Africa and listed on the JSE Limited. All its subsidiaries, associates
and joint ventures are considered to be related parties.
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
The following persons are included as key management:
SI Kankondi
HW Timke
J Arnold
T Weitz
T Mberirua
W Schuckmann
Q King
Non-executive directors’ compensation
Attendance fees 1 110 1 009 – –
Executive directors and key management compensation
Salaries and other short-term employee benefits 15 026 14 129 – –
Receivable from related parties
Loans to related parties
Bidvest Namibia Commercial Holdings (Pty) Limited – (i) – – 154 416 209 437
Bidvest Namibia Management Services (Pty) Limited – (i) – – 23 823 23 823
Bidvest Namibia Property Holdings (Pty) Limited – (i) – – 91 757 33 399
Bidvest Namibia Information Technology (Pty) Limited – (i) – – 5 521 4 021
– – 275 517 270 680
Trade receivables
Bidsport (Pty) Limited – (ii) – 20 – –
Budget Rent a Car (Pty) Limited 23 – – –
Minolco (Pty) Limited – (ii) 195 62 – –
Caterplus (Pty) Limited – (ii) 1 038 – – –
Kolok (Pty) Limited – (ii) 264 – – –
Manica Africa (Pty) Limited – (ii) – 8 – –
Manica (Zambia) Limited – (ii) 146 97 – –
Safcor Freight (Pty) Limited – (ii) 17 259 – –
Steiner Hygiene (Pty) Limited – (ii) 32 17 – –
Namibia Bureau de Change (Pty) Limited – (ii) 9 1 – –
Foreal Investments (Pty) Limited – (iii) 160 – – –
Rennies Express Freight (Namibia) (Pty) Limited – (ii) – 27 – –
1 884 491 – –
1 884 491 275 517 270 680
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201489
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
37. RELATED PARTY BALANCES AND TRANSACTIONS (continued)
Payable to related parties
Loans from related parties
McCarthy Limited – (ii) – 90 458 – –
Trade payables
Bidvest Afcom (Pty) Limited – (ii) 368 316 – –
Bid Corporate Services (Pty) Limited – (ii) 62 557 – –
Bid Information Exchange (Pty) Limited – (ii) 11 – – –
BidOffice Furniture Manufacturing (Pty) Limited – (ii) 724 232 – –
Bidsport (Pty) Limited – (ii) 355 298 – –
Bidvest Bakery Solutions (Pty) Limited – (ii) 172 – – –
Budget Rent a Car (Pty) Limited – (ii) 45 – – –
Caterplus (Pty) Limited – (ii) – 160 – –
Cecil Nurse (Pty) Limited – (ii) 241 356 – –
Chipkins Catering Supplies (Pty) Limited – (ii) 856 –
First Food Distributors (Pty) Limited – (ii) 581 3 904 – –
Hortors Stationery (Pty) Limited – (ii) 14 1 – –
Kolok (Pty) Limited – (ii) 5 410 9 005 – –
Lithotech Sales Cape (Pty) Limited – (ii) 25 8 – –
Lithotech Listing and Logistics (Pty) Limited – (ii) 140 5 – –
Minolco (Pty) Limited – (ii) 1 242 1 934 – –
Voltex (Pty) Limited – (ii) 4 517 1 870 – –
Rennies Express Freight (Namibia) (Pty) Limited – (ii) 11 8 – –
Rennies Ships Agency (Pty) Limited – (ii) 11 – – –
Safcor Freight (Pty) Limited – (ii) – 3 – –
Silveray Statmark Company (Pty) Limited – (ii) 726 290 – –
South African Diaries (Pty) Limited – (ii) 4 – – –
Steiner Hygiene (Pty) Limited – (ii) 314 – – –
Waltons (Pty) Limited – (ii) 650 405 – –
16 479 19 352 – –
16 479 109 810 – –
Sales to related parties
Budget Rent a Car (Pty) Limited – (ii) 132 – – –
Rennies Express Freight (Namibia) (Pty) Limited – (ii) 2 27 – –
Voltex (Pty) Limited – (ii) 130 – – –
Manica Africa (Pty) Limited – (ii) – 15 – –
Manica (Zambia) Limited – (ii) 993 690 – –
Manica Zimbabwe Limited – (ii) 6 89 – –
Safcor Freight (Pty) Limited – (ii) 1 768 1 220 – –
Minolco (Pty) Limited – (ii) 62 233 – –
Foreal Investments (Pty) Limited – (iii) 4 421 1 555 – –
Oshivelelwa Investments (Pty) Limited – (iii) – 661 – –
7 514 4 490 – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201490
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
37. RELATED PARTY BALANCES AND TRANSACTIONS (continued)
Purchases from related parties
Bidvest Afcom (Pty) Limited – (ii) 3 693 3 009 – –
Bid Information Exchange (Pty) Limited – (ii) 22 4 – –
BidOffice Furniture Manufacturing (Pty) Limited – (ii) 6 443 5 439 – –
Bidsport (Pty) Limited – (ii) 880 – – –
Bidvest Bakery Solutions (Pty) Limited – (ii) 256 – – –
Cecil Nurse (Pty) Limited – (ii) 2 999 3 307 – –
Chipkins Catering Supplies (Pty) Limited – (ii) 4 775 2 534 – –
First Food Distributors (Pty) Limited – (ii) 12 097 10 736 – –
Hortors Stationery (Pty) Limited – (ii) 104 84 – –
Kolok (Pty) Limited – (ii) 75 057 60 037 – –
Lithotech Listing and Logistics (Pty) Limited – (ii) 682 579 – –
Lithotech Sales Cape (Pty) Limited – (ii) 158 95 – –
Minolco (Pty) Limited – (ii) 18 504 20 496 – –
Namibia Bureau de Change (Pty) Limited – (ii) 552 674 – –
Ozalid South Africa (Pty) Limited – (ii) 2 9 – –
Rennies Express Freight (Namibia) (Pty) Limited – (ii) 64 155 – –
Silveray Statmark Company (Pty) Limited – (ii) 9 221 6 257 – –
South African Diaries (Pty) Limited – (ii) 784 660 – –
Steiner Hygiene (Pty) Limited – (ii) 2 142 1 393 – –
Voltex (Pty) Limited – (ii) 24 257 12 935 – –
Waltons (Pty) Limited – (ii) 9 587 7 716 – –
172 279 136 119 – –
Administration and royalty fees paid to related parties
Bid Corporate Services (Pty) Limited (royalties) – (ii) 326 268 – –
Bid Corporate Services (Pty) Limited (fees) – (ii) 743 701 – –
McCarthy Limited – (ii) – 3 504 – –
Waltons (Pty) Limited – (ii) 420 389 – –
Cecil Nurse (Pty) Limited – (ii) 1 171 1 263 – –
Minolco (Pty) Limited – (ii) 702 660 – –
3 362 6 785 – –
Interest paid to related parties
McCarthy Limited – (ii) – 2 700 – –
Quota rental fees paid to related parties
Spoto Fishing (Pty) Limited 26 400 27 760 – –
The Group paid quota rental fees to the above mentioned companies. M Shipanga is a director of Spoto Fishing (Pty) Limited. S Kankondi, M Mokgatle-Aukhumes and
M Shipanga hold indirect shareholdings in Spoto Fishing (Pty) Limited. These transactions occurred under terms that are market-related.
(i) Direct subsidiary
(ii) Fellow subsidiary of the Group
(iii) M Shipanga is a director and shareholder in Foreal Investments (Pty) Limited and Oshivelelwa (Pty) Limited.
Related party transactions were carried out on terms and conditions as agreed between the parties.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201491
38. FINANCIAL RISK MANAGEMENT
38.1 Financial risk factorsThe Group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit
risk and liquidity risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects
on the Group’s financial performance.
The financial risk management function is carried out by local management on a subsidiary level.
(a) Market risk(i) Foreign exchange risk
Currency risk is created due to the influence of exchange rate fluctuations. The Group operates internationally and is exposed to foreign exchange risk arising
from various currency exposures, primarily with respect to the US dollar and the euro. Foreign exchange risk arises when future commercial transactions and
recognised assets and liabilities are denominated in a currency that is not the Group’s functional currency. The Group has a policy to consider the need to take
out cover on outstanding foreign currency transactions on an ad hoc basis, as and when such transactions occur. Upon the final decision and discretion of
management, cover is then taken out from time to time.
At June 30 2014, if the currency had weakened/strengthened by 10% against the US dollar and/or euro with all other variables held constant, post-tax profit for
the year would not have been materially impacted. This can be seen in the analysis of foreign currency financial instruments at year-end:
Euro US dollar Angola kwanza
denominated denominated denominated Totals in
’000 ’000 ’000 NAD’000
Group
As at June 30 2014
Trade and other receivables – 3 859 – 41 576
Cash and cash equivalents – 6 862 349 416 109 716
Trade and other payables (27) (1 076) – (12 254)
(27) 9 645 349 416 139 038
Equivalent in NAD (394) 102 905 36 527 139 038
Group
As at June 30 2013
Trade and other receivables – 634 – 6 472
Cash and cash equivalents – 6 219 333 008 97 458
Trade and other payables – (5 227) – (54 033)
– 1 626 333 008 49 897
Equivalent in NAD – 15 894 34 003 49 897
(ii) Price risk
The Group is not exposed to any significant commodity price risk or equity securities price risk.
(iii) Interest rate risk
The Group’s only significant interest-bearing assets are cash and cash equivalents. Since the Group does not have any significant fixed interest rate financial
instruments it is not exposed to significant fair value interest rate risk. The Group’s interest rate risk arises mainly from cash invested in current and call accounts
and from its bank overdraft.
The Group’s trade and other receivables and trade and other payables do not expose the Group to any significant interest rate risks due to their short-term non-
interest nature.
The table below provides the interest rates for monetary financial instruments at year-end:
Group Company
2014 2013 2014 2013
% % % %
Cash and cash equivalents 5,41 3,48 4,25 4,25
Bank overdraft 7,25 7,25 – –
Cash flow sensitivity analysis for floating interest rate bearing instruments.
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201492
38. FINANCIAL RISK MANAGEMENT (continued)
38.1 Financial risk factors (continued)
(a) Market risk (continued)
(iii) Interest rate risk (continued)
A change of 100 basis points in interest rates at the reporting date would have increased or decreased accumulated losses and surplus by the amounts
shown below. This analysis assumes that all other variables remain constant. The analysis was performed on the same basis for 2013.
Group Company
Effect on profit and equity Effect on profit and equity
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
Cash and cash equivalents 7 820 8 528 2 042 2 057
(b) Credit riskCredit risk arises from cash and cash equivalents, deposits with banks and financial institutions, as well as credit exposures to customers and committed transactions.
The Group has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history. The Group has policies that
limit the amount of credit risk exposure to any one financial institution, and cash transactions are limited to high credit quality financial institutions.
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting date was:
Group Company
Carrying amount Carrying amount
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
Trade receivables 381 150 275 468 – –
Related party loans – – 275 517 270 680
Other receivables 87 396 86 273 95 49
Trade and other receivables 468 546 361 741 275 612 270 729
Cash and cash equivalents 782 011 852 824 204 166 205 692
1 250 557 1 214 565 479 778 476 421
The ageing of the components of trade receivables at year-end was:
Gross Impairment Gross Impairment
2014 2014 2013 2013
NAD’000 NAD’000 NAD’000 NAD’000
Group
Trade debtors
Not past due 309 859 (7) 232 140 (3)
Past due 1 – 30 days 47 988 (150) 31 160 (373)
Past due 31 – 90 days 14 375 (259) 7 542 (665)
Past due 91 – 180 days 5 629 (1 901) 7 355 (4 074)
Past due more than 180 days 11 629 (6 013) 7 288 (5 098)
389 480 (8 330) 285 485 (10 213)
Company
Trade debtors
Not past due – – – –
Other debtors
Not past due 95 – 49 –
Credit quality of financial assets
The Group has not renegotiated the terms of receivables and has collaterals or guarantees as security for all significant debtors. The Group limits its exposure to
credit risk by investing in high-quality credit-worthy counterparties. Given these high credit ratings, the directors do not expect any counterparty to fail to meet its
obligations. The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to external credit ratings (if available) or to
historical information about counterparty default rates.
The Group only banks with high credit quality financial institutions. The Group has bank accounts with First National Bank, Standard Bank Namibia, Nedbank Namibia
and Bank Windhoek.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201493
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
38. FINANCIAL RISK MANAGEMENT (continued)
38.1 Financial risk factors (continued)(b) Credit risk (continued)
Counterparties without external credit ratings net of provision for impairment:
Other receivables 87 396 86 273 95 49
Angolan banks 70 953 66 596 – –
Trade receivables 381 150 275 468 – –
539 499 428 337 95 49
Counterparties with strong external credit ratings:
Cash and cash equivalents and money market funds
Cash on hand 870 1 937 – –
Old Mutual Corporate Fund 106 811 101 277 106 811 101 277
Bank Windhoek Corporate Fund 104 037 95 654 90 989 86 271
First Rand Group (FNB) 40 867 31 270 – –
Nedbank Namibia Limited – 373 – –
Standard Bank Namibia Limited 450 094 552 395 6 350 18 144
Bank Windhoek Limited 8 379 3 324 16 –
711 058 786 230 204 166 205 692
The Group’s standard credit terms are cash on or before delivery, nil and 30 days from statement date. The average credit period on sales of goods of the Group is
31 days (2013: 30). In some instances interest is charged on overdue accounts at prime plus 2% on the outstanding balance. Some sales are insured by a credit
guarantee cover. Included in the trade and other receivables are balances totalling NAD70,4 million (2013: NAD43,1 million) with no collateral, none of which in its
own right is material to the Group.
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.
(c) Liquidity riskPrudent liquidity risk management implies maintaining sufficient cash and availability of funding through an adequate amount of committed credit facilities. Due to the
dynamic nature of the business, the Group aims at maintaining flexibility in funding by keeping committed credit lines available.
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity
date. The amounts disclosed in the table are the contractual undiscounted cash flows.
Less than Between 1 Between 2 Over
1 year and 2 years and 5 years 5 years
NAD’000 NAD’000 NAD’000 NAD’000
Group
As at June 30 2014
Bank overdraft 1 872 – – –
Trade and other payables 388 231 – – –
390 103 – – –
As at June 30 2013
Provisions – 1 124 – –
Bank overdraft 22 159 – – –
Trade and other payables 494 820 7 062 – –
516 979 8 186 – –
Company
As at June 30 2014
Trade and other payables 217 – – –
As at June 30 2013
Trade and other payables 199 – – –
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201494
38. FINANCIAL RISK MANAGEMENT (continued)
38.1 Financial risk factors (continued)(c) Liquidity risk (continued)
The average credit period on the purchase of certain goods from major creditors is current to 90 days. No interest is charged on the trade payables for the first 30 to
90 days from the date of the invoice. Thereafter, interest is charged at varying rates ranging from nil to 30% per annum on the outstanding balance. The Group has
financial risk management policies in place to ensure that all payables are paid within the credit timeframe.
Prudent liquidity risk management implies maintaining sufficient cash and marketable securities and the availability of funding through committed credit facilities with
the Group’s bankers. The credit facilities of the Group are reviewed annually and consist of the following unsecured and secured bank overdraft facilities:
Group Company
2014 2013 2014 2013
NAD’000 NAD’000 NAD’000 NAD’000
Unsecured bank overdraft facilities, reviewed annually and payable on demand
Standard Bank Namibia Limited 70 250 30 750 – –
Bank Windhoek Limited 500 500 – –
70 750 31 250 – –
Secured bank overdraft facilities, reviewed annually and payable on demand
Standard Bank Namibia Limited facilities 30 500 70 000 – –
First National Bank Namibia Limited facilities 31 850 31 850
62 350 101 850 – –
38.2 Capital risk management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits
for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust
the amount of dividends paid to shareholders.
The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings (including
“current and non-current borrowings” as shown in the consolidated statement of financial position) less cash and cash equivalents. Total capital is calculated as equity as
shown in the consolidated statement of financial position plus net debt. The Group’s capital exceeds its net debt and thus the capital risk is assessed as low.
Financial Financial
assets at liabilities at
amortised amortised
cost cost Total
NAD’000 NAD’000 NAD’000
38.3 Financial instruments per categoryGroup
As at June 30 2014
Financial assets
Trade and other receivables 468 546 – 468 546
Cash and cash equivalents 782 011 – 782 011
Financial liabilities
Bank overdraft – (1 872) (1 872)
Trade and other payables – (388 231) (388 231)
Total financial instruments 1 250 557 (390 103) 860 454
As at June 30 2013
Financial assets
Trade and other receivables 361 741 – 361 741
Cash and cash equivalents 852 824 – 852 824
Financial liabilities
Bank overdraft – (22 159) (22 159)
Trade and other payables – (501 882) (501 882)
Total financial instruments 1 214 565 (524 041) 690 524
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201495
Financial Financial
assets at liabilities at
amortised amortised
cost cost Total
NAD’000 NAD’000 NAD’000
38. FINANCIAL RISK MANAGEMENT (continued)
38.3 Financial instruments per category (continued)Company
As at June 30 2014
Financial assets
Trade and other receivables 275 612 – 275 612
Cash and cash equivalents 204 166 – 204 166
Financial liabilities
Trade and other payables – (217) (217)
Total financial instruments 479 778 (217) 479 561
As at June 30 2013
Financial assets
Trade and other receivables 270 728 – 270 728
Cash and cash equivalents 205 692 – 205 692
Financial liabilities
Trade and other payables – (199) (199)
Total financial instruments 476 420 (199) 476 221
38.4 Fair value measurements(a) Valuation
In terms of IFRS, the Group is required to measure certain assets and liabilities at fair value. The Group has established control frameworks and processes to
independently validate its valuation techniques and inputs used to determine its fair value measurements.
Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the
measurement date, ie an exit price. Fair value is therefore a market-based measurement and when measuring fair value the Group uses the assumptions that market
participants would use when pricing an asset or liability under current market conditions, including assumptions about risk. When determining fair value it is presumed
that the entity is a going concern and the fair value is therefore not an amount that represents a forced transaction, involuntary liquidation or a distressed sale.
Fair value measurements are determined by the Group on both a recurring and non-recurring basis.
Recurring fair value measurements
Recurring fair value measurements are those for assets and liabilities that IFRS require or permit to be recognised at fair value and are recognised in the statement
of financial position at reporting date. These include financial assets, financial liabilities and non-financial assets that the Group measures at fair value at the end of
each reporting period.
Financial instruments
When determining the fair value of a financial instrument, where the financial instrument has a bid or ask price (for example in a dealer market), the Group uses the
price within the bid-ask spread that is most representative of fair value in the circumstances. Although not a requirement, the Group uses the bid price for financial
assets or the ask/offer price for financial liabilities where this best represents fair value.
When determining the fair value of a financial liability or the Group’s own equity instruments, the quoted price for the transfer of an identical or similar liability or own
equity instrument is used. Where this is not available, and an identical item is held by another party as an asset, the fair value of the liability or own equity instrument is
measured using the quoted price in an active market of the identical item, if that price is available, or using observable inputs (such as the quoted price in an inactive
market for the identical item) or using another valuation technique.
Where the Group has any financial liability with a demand feature the fair value is not less than the amount payable on demand, discounted from the first date that the
amount could be required to be paid where the time value of money is significant.
Non-financial assets
When determining the fair value of a non-financial asset, a market participant’s ability to generate economic benefits by using the asset in its highest and best use or
by selling it to another market participant that would use the asset in its highest and best use, is taken into account. This includes the use of the asset that is physically
possible, legally permissible and financially feasible.
Non-recurring fair value measurements
Non-recurring fair value measurements are those triggered by particular circumstances and include the classification of assets and liabilities as non-current assets
or disposal groups held for sale under IFRS 5, where fair value less costs to sell is the recoverable amount, IFRS 3 Business Combinations where assets and liabilities
are measured at fair value at acquisition date, and IAS 36 Impairments of Assets where fair value less costs to sell is the recoverable amount. These fair value
measurements are determined on a case-by-case basis as they occur within each reporting period.
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38. FINANCIAL RISK MANAGEMENT (continued)
38.4 Fair value measurements (continued)(a) Valuation (continued)
Other fair value measurements
Other fair value measurements include assets and liabilities not measured at fair value but for which fair value disclosures are required under another IFRS eg financial
instruments at amortised cost. The fair value for these items is determined by using observable quoted market prices where these are available or in accordance with
generally acceptable pricing models such as a discounted cash flow analysis. For all other financial instruments at amortised cost the carrying value is equal to or a
reasonable approximation of the fair value.
(b) Fair value hierarchy and measurementsThe Group classifies assets and liabilities measured at fair value using a fair value hierarchy that reflects whether observable or unobservable inputs are used in
determining the fair value of the item. If this information is not available, fair value is measured using another valuation technique that maximises the use of relevant
observable inputs and minimises the use of unobservable inputs. The valuation techniques employed by the Group include, inter alia, quoted prices for similar assets
or liabilities in an active market, quoted prices for the same asset or liability in an inactive market, adjusted prices from recent arm’s-length transactions, option-pricing
models, and discounted cash flow techniques.
Level 1
Fair value is determined using unadjusted quoted prices in active markets for identical assets or liabilities where this is readily available and the price represents actual
and regularly occurring market transactions. An active market is one in which transactions occur with sufficient volume and frequency to provide pricing information
on an ongoing basis.
Level 2
Fair value is determined using inputs other than quoted prices that are observable for the asset or liability, either directly or indirectly such as quoted prices for similar
items in an active market or for an identical item in an inactive market, or valuation models using observable inputs or inputs derived from observable market data.
Level 3
Fair value is determined using a valuation technique and significant inputs that are not based on observable market data (ie unobservable inputs) such as an entity’s
own assumptions about what market participants would assume in pricing assets and liabilities.
The table below sets out the valuation techniques applied by the Group for recurring fair value measurements of assets and liabilities categorised as level 1 and
level 3 in the fair value hierarchy:
Instrument
Fair value
hierarchy level
Valuation
technique
Description
of valuation
technique and
main assumptions
Observable
inputs
Significant
unobservable
inputs of
level 3 items
Financial assets and liabilities
not measured at fair value but for
which fair value is disclosed
Level 3 Discounted
cash flows
The future cash flows are
discounted using a market-
related interest rate
Market interest rates Credit inputs
Biological assets Level 1 Market prices Fair value less
estimated point-of-sale costs
Market prices Not applicable
During the year there were no changes in the valuation techniques used by the Group.
39. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results.
The preparation of the Group’s financial statements necessitates the use of estimates, assumptions and judgements. These estimates and assumptions affect the reported
amounts of assets and liabilities at the reporting date as well as affecting the reported income and expenses for the year. Although estimates are based on management’s
best knowledge and judgement of current facts as at the reporting date, the actual outcome may differ from these estimates.
Estimated recoverable amount of certain cash-generating units
The Group tests annually whether goodwill has suffered any impairment, in accordance with the accounting policy. The recoverable amounts of cash-generating units have
been determined based on value-in-use calculations. These calculations require the use of estimates. Assumptions used are referred to under note 2.2.
Fishing vessels
The residual values of fishing vessels are based on valuations performed by independent external valuators. Revaluations are made with sufficient regularity to ensure that
the carrying amounts do not differ materially from the revalued amounts. The residual values are calculated using management’s best estimates and using the exchange
rates at the reporting date.
Deferred taxation assets
Deferred taxation assets are recognised to the extent that it is probable that taxable income will be available against which they can be utilised. Management estimates that
there will be sufficient taxable profit in the future against which to utilise the deferred tax asset.
Contingent liabilities
Contingent liabilities are raised based on management’s assessment of whether a possible obligation exists which existence will be confirmed by the occurrence or non-
occurrence of one or more uncertain events.
During the year, management identified that a subsidiary of the Group, T&C Properties (Pty) Limited, has an exposure to import VAT, interest and penalties due to an
administrative error in processing transactions on an incorrect import VAT account. Management has investigated the exposure and has implemented steps to rectify the
administrative error which should result in the possible exposure to the Group being resolved without incurring significant liabilities.
Notes to the financial statements continuedfor the year ended June 30
BIDVEST NAMIB IA L IM ITED
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40. STANDARDS, AMENDMENTS AND INTERPRETATIONS ISSUED
At the date of authorisation of these annual financial statements, the following standards and interpretations were in issue but not yet effective, and were not early adopted:
New/revised International Financial Reporting Standards
Effective for
annual periods
beginning on or
after
IFRS 2 Share-Based Payments – Amendments resulting from annual improvements 2010 – 2012 cycle (vesting conditions) July 1 2014
IFRS 3 Business Combinations – Amendments resulting from annual Improvements 2010 – 2012 cycle (contingent consideration) July 1 2014
IFRS 7 Financial Instruments: Disclosures – Amendments requiring disclosures about the initial application of IFRS 9 January 1 2018
IFRS 7 Financial Instruments: Disclosures – Additional hedge accounting disclosure January 1 2018
IFRS 8 Operating segments – Amendments resulting from Annual Improvements 2010 – 2012 cycle July 1 2014
IFRS 9 Financial Instruments: Deferral of mandatory effective date of IFRS 9 and amendments to transition disclosures January 1 2018
IFRS 9 Financial Instruments: Classification and Measurement January 1 2018
IFRS 9 Financial Instruments: Accounting for financial liabilities and derecognition January 1 2018
IFRS 9 Financial Instruments: Accounting for hedge accounting January 1 2018
IFRS 10 Amendments for Investment Entities January 1 2014
IFRS 12 Amendments for Investment Entities January 1 2014
IFRS 13 Fair Value Measurement – Amendments resulting from annual improvements 2011 – 2013 cycle July 1 2014
IFRS 14 Regulatory Deferral Accounts January 1 2016
IFRS 15 Revenue from contracts with customers January 1 2017
IAS 19 Employee Benefits – Amended to clarify the requirement that relates to how contributions from employees or third parties that are linked
to service should be attributed to periods of service
July 1 2014
IAS 24 Related Party Disclosures – Amendments resulting from annual improvements 2010 – 2012 cycle (management entities) July 1 2014
IAS 27 Separate Financial Statements – Amendments for investment entities July 1 2014
IAS 39 Financial Instruments – Recognition and Measurement – Amendments to permit an entity to elect to continue to apply the hedge
accounting requirements in IAS 39 for a fair value hedge
January 1 2018
IAS 32 Financial Instruments – Presentation – Amendments to application guidance on the offsetting of financial assets and financial liabilities January 1 2014
IAS 36 Amendments Arising from Recoverable Amount – Disclosures of Non-Financial Assets January 1 2014
IAS 39 Amendments for Novations of Derivatives January 1 2018
IFRIC 21 Levies January 1 2014
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201498
FINANCIAL YEAR-END June 30
ANNUAL GENERAL MEETING November
REPORTS AND ACCOUNTS
Interim report for the half year ending December 31 February/March
Announcement and annual results August/September
Annual integrated report September/October
DISTRIBUTIONS
Interim distribution March
Final distribution September
Shareholders’ diary
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 201499
BIDVEST NAMIBIA LIMITED
Incorporated in the Republic of Namibia
Registration number: 89/271
Share code: BVN
ISIN code: NA000A0Q5TN0
COMPANY SECRETARY
Ms Veryan Hocutt
AUDITORS
Deloitte & Touche Namibia
Registered Accountants and Auditors
ICAN practice number 9407
Deloitte Building, Maerua Mall Complex
Jan Jonker Road, Windhoek, Namibia
Telephone: +264 (61) 285 5000
Facsimile: +264 (61) 285 5050
LEGAL ADVISER
H.D. Bossau & Co
15th Floor, Frans Indongo Gardens
19 Dr Frans Indongo Street
Windhoek, Namibia
Telephone: +264 (61) 370 850
Facsimile: +264 (61) 370 855
Koep & Partners
33 Schanzen Road, Windhoek, Namibia
Telephone: +264 (61) 382 800
Facsimile: +264 (61) 382 888
COMMERCIAL BANKERS
Standard Bank Namibia Limited
Registration number: 78/01799
Standard Bank Centre, Post Street Mall
Windhoek, Namibia
(PO Box 3327, Windhoek, Namibia)
Telephone: +264 (61) 294 9111
Facsimile: +264 (61) 294 2555
Administration
TRANSFER SECRETARIES
Transfer Secretaries (Pty) Limited
Registration number: 93/713
4 Robert Mugabe Avenue, Windhoek, Namibia
(PO Box 2401, Windhoek, Namibia)
Telephone: +264 (61) 227 647
Facsimile: +264 (61) 248 531
SPONSOR AND CORPORATE ADVISER
PSG Wealth Management Namibia
(Pty) Limited
Member of the Namibian Stock Exchange
Registration number: 98/528
5 Conradie Street
Windhoek, Namibia
Telephone: +264 (61) 378 900
Facsimile: +264 (61) 378 901
REGISTERED ADDRESS
4 Robert Mugabe Avenue, Windhoek, Namibia
(PO Box 6964, Ausspannplatz, Windhoek, Namibia)
Telephone: +264 (61) 417 450
Facsimile: +264 (61) 229 290
WEBSITE
www.bidvestnamibia.com.na
EMAIL info@bidvest.com.na
communications@bidvest.com.na
ETHICS LINE
Free call: 0800 28 68 82
Cellular free call: 081 91 847
Email: bidvestnamibia@tipoffs.com
BIDVEST NAMIB IA L IM ITED
Annual Integrated Report 2014100
Namibia Fisheries
Namibia Commercial
Our company logos
BASTION GRAPHICS
www.bidvestnamibia.com.na
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