INVITATION TO THE PUBLIC FOR SUBSCRIPTION/PURCHASE of ...wisynco.com/wp-content/uploads/2017/11/Wisynco-Group-Limited... · 1 A copy of this Prospectus was delivered to the Registrar

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A copy of this Prospectus was delivered to the Registrar of Companies for registration pursuant to Section 40(2) of the Companies Act 2004 and was so registered on 28th November 2017 The Registrar of Companies accepts no responsibility whatsoever for the contents of this Prospectus.

A copy of this Prospectus was also delivered to the Financial Services Commission for registration pursuant to section 26 of the Securities Act and was so registered on 28th November 2017. The Financial Services Commission has not approved the Shares for which subscription is invited nor has the Commission passed upon the accuracy or adequacy of this Prospectus.

INVITATION TO THE PUBLIC FOR SUBSCRIPTION/PURCHASE

of

784,500,000 ORDINARY SHARES at J$7.87 per ORDINARY SHARE

(subject to any discounts offered to Reserved Share Applicants Payable in Full on Application)

WISYNCO GROUP LIMITED (the “Company”)

Dated: 28 November 2017

Registered Office Lakes Pen, St. Catherine, Jamaica

Website: www.wisynco.com

Tel No: 876-665-9000

COMBINED OFFER FOR SALE & PROSPECTUS

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We represent a wide range of category-leading brands. The brands owned by us are included below.

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WISYNCO GROUP LIMITED INVITATION FOR SUBSCRIPTION

Up to 784,500,000 Shares at the Subscription Price of J$7.87 per Share, subject to any discounts offered to Reserved Share Applicants Payable in Full on Application. Reserved Share Applicants are the persons (as referred to herein) who are entitled to subscribe for Reserved Shares in their respective categories, namely: the Employees, Strategic Investors and the Broker.

The Company invites Applications on behalf of itself, for up to 149,414,576 Shares in this invitation made by it to the general public subject to this prospectus (the “Invitation”).

The Company also invites Applications on behalf of the Selling Shareholders for purchase of up to 635,085,424 Shares (the “Sale Shares”) in the Invitation. The Company is the agent of the Selling Shareholders in the Invitation for the purposes of acceptance of Applications to purchase the Sale Shares.

Up to 314,700,000 Shares in the Invitation (the “Reserved Shares”) are initially reserved for priority application from, and subscription and/or purchase by the following persons (the “Reserved Share Applicants”):

a) up to 150,000,000 Shares are initially available for subscription and/or purchase by the Strategic Investors at a Subscription Price of J$7.87 per Share.

b) up to 112,500,000 Shares are initially available for subscription and/or purchase for all of the employees of the Company including executives, senior managers and directors, (the “Employees”). All the Employees will be given an opportunity to purchase Shares at a discounted price of J$7.08 per Share.

c) up to 52,200,000 Shares reserved for the Broker at the Subscription Price of J$7.87 per Share.

If any of the allocated Reserved Shares in any category are not fully subscribed by and/or purchased by the persons entitled to them, the excess will be made available for subscription and/or purchase by the Strategic Investors Applicants at the Subscription Price and thereafter, they will become available for subscription and/or purchase by the general public at the Subscription Price. This policy will be applied absolutely across all categories of Reserved Shares as set out in paragraphs (a) to (c) above.

Application Form(s) for use by all Applicants are provided in Appendix 1 of this Prospectus together with notes on how to complete them. The Invitation will open at 9: 00 a.m. on the Opening Date, Wednesday, 6 December 2017. Application Form(s) submitted prior to 9:00 a.m. on the Opening Date will be received, but not processed until 9:00 a.m. on the Opening Date. The Invitation will close at 4:00 p.m. on the Closing Date, Friday, 15 December 2017, subject to the right of the Company to: (a) close the Invitation at any time after it opens once Applications for all of the Shares in the Invitation valued between J$6,085,140,000, assuming all the Employees’ Shares allocation are taken up, and J$6,174,015,000 assuming none of the Employees’ Shares are taken up; and (b) extend the Closing Date for any reason in its sole discretion, provided that it is not later than 40 days after the publication of this Prospectus for the purposes of Section 48 of the Companies Act. In the case of an early closing, or an extension to the Closing Date, notice will be posted on the website of the Jamaica Stock Exchange (“JSE”) at (www.jamstockex.com).

It is the intention of the Company to apply to the JSE to list the Shares (inclusive of the Sale Shares) on the Main Market of the JSE. The Company offers no guarantee that any of the Shares will be admitted to listing.

As per Rule 402 of the JSE Main Market Rules, if the Invitation does not raise at least J$5.82 billion (assuming all the Employees’ Shares allocation are taken up), which is equivalent to 20% of the Issued Share Capital of the Company, by the Closing Date as aforesaid, all monies received will be refunded. If however, the Invitation raises at least J$5.82 billion (assuming all the Employees’ Shares allocation are taken up) from subscription/purchase of the said Shares by prospective Applicants but for some reason the application by the Company to list the Shares is not granted by the JSE, all payments received from Applicants will be returned to the Applicants. In addition, the making of the relevant application for listing on the Main Market of the JSE and its success is dependent on this criteria and other criteria for admission set out in the JSE Listing Rules.

See the full terms and conditions of the Invitation in Section 6 of this Prospectus.

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SHARE CAPITAL

Authorised Ordinary Shares 4,000,000,000

Issued Ordinary Shares as at the date of the Prospectus 3,600,585,424

Maximum number of new Ordinary Shares to be issued by the Company in the Invitation

149,414,576

Maximum number of Sale Shares in the Invitation to be sold by theSelling Shareholders

635,085,424

Details of the Issued Share Capital of the Company prior to and after the Invitation, assuming that it is fully subscribed, are set out in Section 8 of this Prospectus. We estimate that post transaction new shareholders (i.e. members of the general public and the Reserved Shares Applicants) will own approximately 20.92% of the Issued Share Capital of the Company.

Description Number of Shares % of Shares Issued

Composition of the Shares for subscription/purchase:

Reserved Shares:

Employees 112,500,000 3.000%

Strategic Investors 150,000,000 4.000%

Broker 52,200,000 1.392%

Total Reserved Shares 314,700,000 8.392%

Total General Public Shares 469,800,000 12.528%

Total 784,500,000 20.920%

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CONSIDERATION

Total consideration, assuming all categories of Shares in the Invitation are fully subscribed/purchased, is as follows:

Description J$ Amount

Full subscription/purchase of Reserved Shares as set out below:

112, 500,000 of the Employees shares at a Discount Price of J$7.08 per Share 796,500,000

150,000,000 of the Strategic Investors at the Subscription Price of J$7.87 per Share 1,180,500,000

52,200,000 of the Broker at the Subscription Price of J$7.87 per Share 410,814,000

Full subscription/purchase of 469,800,000 Shares by the general public at the Subscription Price of J$7.87 per Share 3,697,326,000

Total Consideration 784,500,000 shares before transaction expenses 6,085,140,000

Amount raised by the Company (149,414,576 Ordinary Shares) 1,158,965,727

Proceeds to the Selling Shareholders (635,085,424 Ordinary Shares) 4,926,174,273

Note that the respective Subscription Price is subject to the Jamaica Central Securities Depository Limited charges of approximately J$163.10 inclusive of General Consumption Tax in respect of each application.

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TABLE OF CONTENTS

1. IMPORTANT DISCLAIMERS ............................................................................................... 7

2. SUMMARY OF KEY INFORMATION ON THE INVITATION ................................................. 9

3. LETTER TO PROSPECTIVE INVESTORS ............................................................................. 11

4. DEFINITIONS USED IN THE PROSPECTUS ....................................................................... 15

5. DISCLAIMER – FORWARD-LOOKING STATEMENTS ........................................................ 17

6. THE INVITATION ............................................................................................................... 18

7. INFORMATION ABOUT THE COMPANY ........................................................................... 22

8. INCORPORATION AND STRUCTURE ................................................................................ 45

9. DIRECTORS AND MANAGEMENT ...................................................................................... 57

10. AUDITOR’S REPORT ......................................................................................................... 66

11. MANAGEMENT’S DISCUSSION & ANALYSIS AND FINANCIAL HIGHLIGHTS ................... 75

12. PRO-FORMA ADJUSTMENTS ............................................................................................. 91

13. FINANCIAL STATEMENTS ................................................................................................ 94

14. RISK FACTORS ................................................................................................................. 139

15. PROFESSIONAL ADVISORS TO THE COMPANY .............................................................. 144

16. STATUTORY AND GENERAL INFORMATION .................................................................. 146

17. DOCUMENTS AVAILABLE FOR INSPECTION .................................................................. 149

18. DIRECTORS’ SIGNATURES .............................................................................................. 150

19. APPENDICES .................................................................................................................... 151

A.1. APPLICATION FORM – ORDINARY SHARES........................................................................ 152

A.2. AUDITOR’S CONSENT LETTER ............................................................................................ 155

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1. IMPORTANT DISCLAIMERS

RESPONSIBILITY FOR THE CONTENTS OF THE PROSPECTUS

This Prospectus has been reviewed and approved by the Board of Directors of the Company. The Directors of the Company whose names appear in Section 9 of this Prospectus are the persons responsible (both individually and collectively) for the information contained herein. To the best of the knowledge and belief of the Directors, who have taken all reasonable care to ensure that such is the case, the information contained in this Prospectus is in accordance with the facts and no information has been omitted which is likely to materially affect the import of information contained herein.

Each of the Directors of the Company have signed this Prospectus for the purposes of his or her responsibility as described herein. Such responsibilities are joint and several as contemplated by the Companies Act. The signatures of the Directors appear in Section 18 of this Prospectus.

Neither the FSC nor any Government agency or regulatory authority in Jamaica has made any determination on the accuracy or adequacy of the matters contained in the Prospectus.

CONTENTS OF THE PROSPECTUS

This Prospectus contains important information for prospective investors in the Company. All prospective investors should read the Prospectus carefully in its entirety before submitting an Application Form.

This Prospectus also contains summaries of certain documents which the Board of Directors of the Company believe are accurate.

Prospective investors may wish to inspect the actual documents that are summarized, copies of which will be available for inspection as described in Section 17. Any summaries of such documents appearing in this Prospectus are qualified in their entirety by reference to the complete document.

The publication of this Prospectus shall not imply that there has been no change in the business, results of operations, financial condition or prospects of the Company since the date of this Prospectus.

No person is authorized to provide information or to make any representation whatsoever in connection with this Prospectus, which is not contained in this Prospectus.

This Prospectus is intended for use in JAMAICA only and is not to be construed as making an invitation to persons outside of Jamaica to subscribe for any Shares. The distribution or publication of this Prospectus and the making of the invitation in jurisdictions outside of Jamaica may be/is prohibited by law.

IMPORTANT DISCLAIMERS (Continued)

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SEEK PROFESSIONAL ADVICE BEFORE MAKING APPLICATION TO SUBSCRIBE FOR SHARES

This Prospectus is not a recommendation by the Company that prospective investors should submit Application Forms to subscribe for Shares in the Company. Prospective investors in the Company are expected to make their own assessment of the Company, and the merits and risks of subscribing for Shares. Prospective investors are also expected to seek appropriate advice on the financial and legal implications of subscribing for Shares, including but not limited to any tax implications.

Each Applicant who submits an Application Form acknowledges and agrees that:

i. He/she/it has been afforded a meaningful opportunity to review the Prospectus (including the terms and conditions in Section 6, and to gather and review all additional information considered by him/her/it to be necessary to verify the accuracy of the information contained in this Prospectus;)

ii. He/she/it has not relied on the Company or any other persons in connection with his/her/its investigation of the accuracy of such information or his/her/its investment decision;

iii. No person connected with the Company has made any representation concerning the Company or this Prospectus not contained in this Prospectus, on which the Applicant has relied in submitting his/her/its Application Form; and

The Applicant is aware of the merits and risks of subscribing for Shares in the Company notwithstanding the Risk Factors set out in Section 14.

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2. SUMMARY OF KEY INFORMATION ON THE INVITATION

The following summary information is derived from and should be read in conjunction with, and is qualified in its entirety by, the full text of this Prospectus, including the Appendices.

Recipients are advised to read this entire Prospectus carefully before making an investment decision about the transactions herein. Each recipient’s attention is specifically drawn to the Risk Factors in Section 14 of this Prospectus and the disclaimers at the beginning of this Prospectus.

If you have any questions arising out of this document or if you require any explanations, you should consult your stock broker, licensed investment advisor, attorney-at-law, accountant or other professional advisor.

Issuer Wisynco Group Limited

Issue 784,500,000 Shares (inclusive of 314,700,000 Reserved Shares) for subscription/purchase which consists of: 149,414,576 newly issued Shares; and the sale of 635,085,424 Shares by the Selling Shareholder

Security Ordinary Shares each in the capital of the Company (sometimes herein referred to as Shares)

Subscription Price J$7.87 per Share subject to applicable discounts

No. of Shares 784,500,000 Ordinary Shares

Use of Proceeds The Company intends to use the net proceeds from newly issued shares in this Invitation to fund:

Expansion of its manufacturing capacity to facilitate growth in all current markets (export and local) for existing and future products;

Investment in more efficient modern internal power generationand utilization;

Potential strategic acquisitions - locally, regionally and internationally;

New distribution partnerships;

Expansion of the Company’s distribution fleet and infrastructure to support the build out of its ‘Route to Market’ system;

The establishment of a western distribution centre; and

Increase working capital to expand distribution arrangements through additional/new third-party brands in key categories not currently served by the Company.

The Selling Shareholders intend to use the sale proceeds for their own purposes.

Application Form See Appendix 1 of the Prospectus

Dividends: The Directors intend to pursue a dividend policy of an annual dividend of at least 20% of net profits after taxes available for distribution, subject to the need for reinvestment in the Company from time to time.

Terms and Conditions See Section 6 of the Prospectus

Acceptable Payment Method

Either: (1) Manager’s Cheque payable to “NCB Capital Markets” (2) cleared funds held in a NCB Capital Markets account; or (3) Transfer or direct deposit NCB Capital Markets (details set out in the Application Form). Absolutely no cash payments will be accepted.

SUMMARY OF KEY INFORMATION ON THE INVITATION (Continued)

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Listing: The Company intends to apply to the JSE for the listing on the Main Market of allof the Shares, and to make such application immediately following the closing of the Invitation and the resulting allotments to facilitate, the allocation of Shares and deposits to the respective JCSD accounts of successful Applicants.

Timetable of Key Dates Registration of Prospectus at the Companies Office:

On or about 28 November 2017

Registration of Prospectus at the FSC: On or about 28 November 2017

Publication of Prospectus: On or about 28 November 2017

Opening Date: 9:00 A.M. 6 December 2017

Closing Date: 4:00 P.M. 15 December 2017

Interpretations: All currency amounts referred to in this Prospectus are in Jamaican dollars unless stated otherwise.

Early Applications Application Forms must be submitted to NCB Capital Markets Limited, along with the requisite payment, in immediately available funds, at the locations set out in Section 6. Early applications may be submitted to NCB Capital Markets Limited. Any such applications will be received, but not processed until the Opening Date. All early applications will be treated as having been received at the same time, being 9:00 a.m. on the Opening Date, and shall be allotted pro rata. All other applications (that is, not early applications) will be received and processed on a first come, first served basis.

Confirmation of Share Allotment

All Applicants may refer to the confirmation instructions that will be posted on the website of the Jamaica Stock Exchange (www.jamstockex.com) after the Closing Date (or the extended Closing Date, as the case may be).

Applicants who wish to receive share certificates must make a specific request to the Jamaica Central Securities Depository Limited.

Returned Applications/Refunds

Available for collection from NCB Capital Markets at “The Atrium”, 32 Trafalgar Road, Kingston 10, Jamaica within 10 working days of the Closing Date.

Final Allotment and Admission of Shares

Available for collection where originally submitted (NCB Capital Markets) within fifteen (15) days of the Closing Date (or the extended Closing Date, as the case may be).

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3. LETTER TO PROSPECTIVE INVESTORS

DEAR PROSPECTIVE INVESTORS IN THE COMPANY:

The Company (on its own behalf and on behalf of the Selling Shareholders) is pleased to invite you to subscribe for and purchase 784,500,000 Shares in the capital of the Company on the terms and conditions set out in this Prospectus. Of those Shares, 635,085,424 are Sale Shares available for purchase from the Selling Shareholders for whom the Company acts as agent in the Invitation. The offer includes Reserved Shares of 314,700,000 that are initially reserved for Employees, Strategic Investors and the Broker.

ABOUT THE COMPANY

Wisynco Group Limited (“Wisynco” or “the Company”) in its current form was established in 2005 as an amalgamation of several, multi-generational family businesses created by the four Mahfood brothers Ferdinand, Sam (Jnr.), Joe and Robin; the first of

which began operating in 1965. Today, Wisynco is a prominent manufacturer and distributor of beverages, food and packaging products in Jamaica. We are a proud Jamaican company with a deeply rooted commitment to the country’s development. Our stated mission is “To improve the lives of our people” which extends to all stakeholders – shareholders, team members, customers, partners and fellow Jamaicans alike.

Brands and Products

Wisynco owns, manufactures and distributes a portfolio of popular beverage brands led by WATA and its extension of cranberry flavoured-WATA, BOOM Energy Drink and BIGGA Soft Drink. We also own and manufacture the SWEET brand range of plastic and foam disposable lunch boxes, plates and cups. In addition to our owned brands, we are the exclusive bottler for the Coca-Cola Company in Jamaica and have been bottling Coca-Cola products for some 11 years. Additional third-party beverage brands manufactured by the Company include SqueezZ and Hawaiian Punch. Our beverage portfolio is completed by Red Bull, Tru Juice Freshhh, Welch’s, Mott’s and Snapple. Whereas we do not manufacture these brands, we distribute them across Jamaica through distribution partnerships with their brand owners.

In addition to the beverage portfolio, the Company also distributes a wide array of grocery products from reputable entities. These include world-renowned grocery brands such as Kellogg’s, General Mills, Hershey Company, Butterball, Herr’s, and Nestlé, as well as local brands such as Kremi and others.

Infrastructure, Distribution and Customer Base

With one of the largest sales forces in Jamaica comprised of more than 700 sales-related employees, Wisynco boasts a sales and distribution infrastructure that has a significant presence in the marketplace. These team members actively engage customers and consumers daily in supermarkets, wholesales, small shops, schools, restaurants, hotels and simply “in the streets” ensuring all Wisynco-represented products are well positioned and accessible to Jamaican consumers at all times.

We operate from a modern centralized 350,000 square foot warehouse space and command a fleet of over 60 owned and 300 contracted trucks that deliver product directly to over 10,000 customers. Our in-trade assets also include over 6,000 coolers and 1,300 freezers which help to ensure the ready-to-serve trial of our products.

The work of our team members, utilizing the assets mentioned above, ensures that the average Jamaican consumes a Wisynco product at least once every two (2) days.

LETTER TO PROSPECTIVE INVESTORS (Continued)

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Management Team and Values

Wisynco’s proven management team, with combined experience of over 100 years in manufacturing and distribution works tirelessly to meet the Company’s goals. We live by the C.H.I.R.P. acronym which speaks to the values of Compassion, Humility, Integrity, Respect, and Passion. These guiding principles define the Wisynco Way by which all our employees strive to live and work. For over 50 years the Wisynco family has expanded by reinvesting profits into training staff and educating the next generation of Wisynco Team Members, creating a unique company culture defined by high levels of employee morale, productivity, engagement and loyalty. Despite many obstacles, we have kept focused on our Company’s growth by upholding a passionate commitment to customers and our country while abiding by our founders’ mantra of putting God and family before company.

Financial Performance

Our strong performance in operations has manifested itself in sustained financial performance. In the past 5 years, revenue has grown by over 10% per annum. Our revenue figures, coupled with maintaining low costs, have led to us achieving in 30 June 2017:

A healthy gross margin of 37.3%;

Earnings Before Interest Tax and Depreciation and amortization (EBITDA) margin of 15.2%; and

Net Profit Margin of 10.5%.

In addition, the Company has achieved a high utilization of assets and equity and has sustained low debt levels as is demonstrated in the following metrics as at 30 June 2017:

Current ratio of 1.86;

Return on Assets of 17.1%;

Return on Equity of 31.3%;

Debt to equity ratio of 24.8%, which is expected to increase to 28.2% based on actual and proposed events post June 2017 (refer to Pro-forma adjustments as noted in Section 12); and

Gearing/leverage ratio of 18.2%, which is expected to increase to 22.0% based on post June 2017 proposed events.

Wisynco - The Innovator

We believe innovation is the most effective driver of long-term, sustainable shareholder value. We have demonstrated a proven ability to innovate, having conceptualized several popular local beverage brands which have become dominant in their respective categories. We have achieved this by understanding the needs of the Jamaican consumer and purposefully crafting products and brands that resonate with their palate and lifestyle.

BIGGA – in 1995 BIGGA was born as the first beverage brand created by the Company. Today BIGGA remains Jamaica’s only locally-manufactured flavoured-soda brand owned by a Jamaican company.

WATA – in 2002 Wisynco was an early entrant to the bottled water industry, with creation of its now famous and uniquely Jamaican brand name. Today, WATA is the leading bottled water brand on the island.

CranWATA – in 2008 WATA launched a line extension of the first ever locally-manufactured flavoured water in Jamaica and won the Jamaica Manufactures’ Association’s Breakthrough Product of the Year.

BOOM – in 2010, BOOM became the first locally manufactured and owned energy drink brand to hit the Jamaican market.


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KEY INVESTMENT HIGHLIGHTS

In closing, Wisynco offers you the investors a unique opportunity to be a part of our company. Key investment highlights include:

THE INVITATION

The Company (on its own behalf and on behalf of the Selling Shareholders) is inviting applications to the Invitation from prospective investors to raise between J$6,085,140,000, assuming all the Employees’ Shares allocation are taken up, and J$6,174,015,000 assuming none of the Employees’ Shares are taken up. Of this amount, up toJ$4.998 billion, will be used by the Selling Shareholders and the rest by the Company for strategic investments. We invite subscriptions for up to 784,500,000 Shares from the general public and the Reserved Share Applicants.

USE OF PROCEEDS

The Directors intend to apply the net Initial Public Offering (IPO) proceeds (i.e. net of the Company’s share of related expenses) from the subscription of new Shares in the Company for strategic initiatives such as:

Expansion of its manufacturing capacity to facilitate growth in all current markets (export and local) for existing and future products;

Investment in more efficient modern internal power generation and utilization;

Potential strategic acquisitions - locally, regionally and internationally;

New distribution partnerships;

Expansion of the Company’s distribution fleet and infrastructure to support the build out of its ‘Route to Market’ system;

The establishment of the a western distribution centre; and

Increase working capital to expand distribution arrangements through additional/new third-party brands in key categories not currently served by the Company.

Proven agile motivated management staff supported by very motivated and

resilient team

State‐of‐the‐art manufacturing facilities

Portfolio of leading local and international brands

Unmatched sales and distribution infrastructure

Strong Financial Performance

Proven track record of innovation and

crisis management


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The proceeds of sale of the Sale Shares by the Selling Shareholders, approximately J$4.998 billion, will accrue to the benefit of the Selling Shareholders and not to the Company.

The Company and the Selling Shareholders intend to use a portion of the proceeds of the Invitation to pay the expenses associated with this IPO. The Company Directors and Selling Shareholders believe such expenses will not exceed J$200 million (inclusive of brokerage and financial advisory fees, legal fees, accountant’s fees, filing fees, initial listing fees, underwriting fees, marketing and expenses, and GCT.

The subscription list opens at 9.00 am on the Opening Date: 6 December 2017 and closes at 4:00 pm on the Closing Date: 15 December 2017, subject to the right of the Company to shorten or extend the time for closing of the subscription list in the circumstances specified in this Prospectus.

DIVIDEND POLICY

Once the Company is admitted to the Main Market, the Directors intend to pursue a dividend policy of an annual dividend of at least 20% of net profits after taxes available for distribution, subject to the need for reinvestment in the Company from time to time.

HOW TO SUBSCRIBE FOR SHARES

Those investors who are interested in subscribing for/purchasing Shares should read this Prospectus in its entirety inclusive of the full terms and conditions of the Invitation set out in Section 6 and the Risk Factors in Section 14 and then complete the Application Form(s) set out in Appendix 1 hereof.

We invite you to become a part of the Wisynco family and to join us as we continue to build out our vision for the future.

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4. DEFINITIONS USED IN THE PROSPECTUS

Act Means the Companies Act, 2004

Allotment Means the allotment of the Shares to successful Applicants by the Company the same to be effected by Jamaica Central Securities Depository Limited, in its capacity as registrar and transfer agent of the Company, on its behalf

Applicant

Means a person (being an individual or a body corporate, whether a Reserved Share Applicant, or a member of the general public) who submits an Application in accordance with the terms and conditions of this Prospectus

Application Form Means the Application Form to be completed by Applicants who wish to make an offer to subscribe for/purchase Shares in the Invitation which is set out in Appendix 1 hereof

Arranger NCB Capital Markets Limited (“NCB Capital Markets”), a securities dealer, duly licensed under the laws of Jamaica, with offices at “The Atrium”, 32 Trafalgar Road, Kingston 10, Jamaica

Auditor’s Report Means the report of PricewaterhouseCoopers Jamaica, Chartered Accountants set out in Section 10

Board of Directors

Means the Board of Directors of the Company, details of which are set out in Section 9 of the Prospectus

Broker NCB Capital Markets Limited (“NCB Capital Markets”), a securities dealer, duly licensed under the laws of Jamaica, with offices at “The Atrium”, 32 Trafalgar Road, Kingston 10, Jamaica

CAGR Means Compound Annual Growth Rate

Company Means Wisynco Group Limited, a company duly incorporated under the Laws of Jamaica, bearing company number: 61,229 and whose registered office is located at Lakes Pen in the parish of St. Catherine, Jamaica

Closing Date Means the date on which the subscription list in respect of the Invitation closes, being 4:00 p.m. on 15 December 2017 subject to the right of the Company to either shorten or extend the subscription period in the circumstances set out in the Prospectus

Director (s) Means a director (s) of the Company

Discount Price Means the price of J$7.08 per Share applicable to the Employees

EBITDA Means Earnings before Interest, Tax, Depreciation and Amortization

Employees Means the employees of the Company including Executives, Senior Managers and Directors

Forward-Looking Statements

Means the forward looking statements referred to in Section 5 of the Prospectus, which are disclaimed by the Company on the terms and for the reasons set out therein

FY Means financial year, for year ending 30 June

FSC Means the Financial Services Commission of Jamaica

Historical Financial Data

Means the figures set out in Section 10, including those extracted from the audited financial statements of the Company for each of the financial reporting periods ended 30TH June in the years 2013 to 2017, the Unaudited Financial Statements of the Company in respect of the period of 1 July 2017 to 30 September 2017

Invitation Means the invitation to subscribe and/or purchase 784,500,000 Shares on the terms and conditions set out in Section 6 of the Prospectus

IPO Means “initial public offering” with respect to the Shares

DEFINITIONS USED IN THE PROSPECTUS (Continued)

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J$/JMD Jamaican Dollar

JSE Means the Jamaica Stock Exchange

Main Market Means the Main Market of the JSE

Opening Date Means the date on which the subscription list in respect of the Invitation opens, being 9:00 a.m. on 6 December 2017

Prospectus Means this document, which constitutes a prospectus for the purposes of the Companies Act, 2004 and the Securities Act

Q1 Means Quarter 1 ending September as related to the unaudited financial statement

Registrar and Transfer Agent

Means the Jamaica Central Securities Depository Limited or such other person as may be appointed by the Company from time to time to provide the services of registrar and paying agent for the Company

Reserved Shares Means up to 314,700,000 Shares in the Invitation which are specifically reserved for application from, and subscription and purchase by, the Reserved Share Applicants at the Subscription Price/Discount Price, as applicable

Reserved Share Applicants

Means the persons (as referred to herein) who are entitled to subscribe for Reserved Shares in their respective categories, namely: the Employees, Strategic Investors and Broker

Sale Shares Means up to the 635,085,424 Shares which are being sold on behalf of the Selling Shareholders

Shares (and Ordinary Shares)

Means the ordinary shares of no par value in the capital of the Company, inclusive of 784,500,000 Shares that are offered by the Company and the Selling Shareholders for subscription and/or purchase in the Invitation on the terms and conditions set out in this Prospectus, and the expression “Shares” shall include the Reserved Shares where the context permits

Shareholders Means the holders of Shares

Selling Shareholders

Means Wisynco Group (Caribbean) Limited (as to 494,093,226 Shares)and Caribbean Bottlers Limited (as to 140,992,198 Shares) identified in the table in Section 8

Strategic Investors

Strategic Investors means stakeholders and supporters of the Company as determined by the executives of Wisynco Group Limited in their sole discretion

Subscription Price

Means J$7.87 per Share or such price as it relates to each respective Reserved Share, as applicable

Terms and Conditions of the Invitation

Means the terms and conditions for Applicants set out in Section 6 of the Prospectus

Unaudited Financial Statements

Means the unaudited financial statements of the Company for 1st Quarter ended 30 September 2017 that are set out in Section 11 of the Prospectus

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5. DISCLAIMER – FORWARD-LOOKING STATEMENTS

Save for the Historical Financial Information contained in this Prospectus, certain matters discussed in this Prospectus, contain forward-looking statements including but not limited to use of proceeds, future plans or future prospects and pro-forma financial information. Forward-looking statements are statements that are not about historical facts and speak only as of the date they are made. Although the Directors believe that in making any such statements its expectations are based on reasonable assumptions, such statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Prospective investors in the Company are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the dates on which they have been made. Future events or circumstances could cause actual results to differ materially from historical or anticipated results.

When used in this Prospectus, the words “anticipates”, “believes”, “expects”, “intends” and similar expressions, as they relate to the Company, are intended to identify those forward-looking statements. These forward-looking statements are subject to numerous risks and uncertainties. Once this Prospectus has been signed by or on behalf of the Company, and prior to the admission of the Company to the Main Market, the Company undertakes no obligation to update publicly or revise any of the forward-looking statements in light of new information or future events, including changes in the Company’s financial or regulatory position, or to reflect the occurrence of unanticipated events (subject to any legal or regulatory requirements for such disclosure to be made). There are important factors that could cause actual results to differ materially from those in forward-looking statements, certain of which are beyond the Company’s control. These factors include, without limitation, the following:

Economic, social and other conditions prevailing both within and outside of Jamaica, including actual rates of growth of the Jamaican and regional economies, instability, high domestic interest rates or exchange rate volatility;

Adverse climatic events and natural disasters;

Changes in any legislation or policy adversely affecting the revenues and/or expenses of the Company;

Actual or perceived deficiencies in the Company’s products or services, unfavourable market receptiveness to the Company’s strategic business plan or its particular line of products and services, or the availability or relative attractiveness of competitors’ alternative products and services. Changes in any legislation or policy adversely affecting the revenues or expenses of the Company;

Any other factor negatively impacting on the realisation of the assumptions on which the Company’s forward-looking statements are based;

Other factors identified in this Prospectus; and

Other factors not yet known to the Company.

Neither the FSC, nor any Government agency or regulatory authority in Jamaica, has made any determination on the accuracy or adequacy of the matters contained in this Prospectus.

Recipients are advised to read this entire Prospectus carefully before making an investment decision about the transactions herein. Each recipient’s attention is specifically drawn to the Risk Factors in Section 14 of this Prospectus and the disclaimers at the beginning of this Prospectus.

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6. THE INVITATION

GENERAL INFORMATION

The Company is seeking to raise up to J$1.18 billion subject to the level of Employees’ subscription of Shares, from subscriptions for the 149,414,576 Shares in the Invitation at the Subscription Price of J$7.87 per Share (subject to discounts in respect of the Reserved Shares, where applicable). The Company is also acting as an agent of the Selling Shareholders in inviting Applications for purchase for 635,085,424 Sale Shares in the Invitation at a price of J$7.87 per Share.

Up to 314,700,000 of the Shares are Reserved Shares that are specifically reserved for application from, and subscription by, the Reserved Share Applicants. Any Reserved Shares not taken up by the Reserved Share Applicants shall be made available for application from, and subscription/purchase by, the general public.

Assuming that all of the 784,500,000 Shares are subscribed/purchased by both the Reserved Share Applicants and the general public in the Invitation, the Company will make an application to the JSE for the Shares to be admitted to the Main Market. If the application is successful, it is anticipated that the Shares will be admitted to trading within thirty (30) days of the Closing Date (or the extended Closing Date, as the case may be).

In the event that the Invitation does not raise at least J$5.82 billion, which is equivalent to 20% of the ownership of the Company as per Rule 402 of the of the Jamaica Stock Exchange Main Market Rules, and/or the Shares are not admitted to trade on the Main Market, all applications will be returned to the Applicants, along with any other payments made in relation thereto.

Prospective investors should read all of the sections referred to carefully together with the remainder of this document. Those prospective investors who wish to subscribe for and or/purchase Shares should also refer to the full terms and conditions set out in this Section 6 before completing the Application Form set out in Appendix 1.

MINIMUM FUNDRAISING

For the purposes of Section 48 of the Companies Act the minimum amount which in the opinion of the Directors must be received by the Company as a result of the subscription of its Shares in the Invitation in order to provide for the matters set out in Paragraph 2 of the Third Schedule (the “minimum allotment”) is J$600 million.

USE OF PROCEEDS

It is the Company’s intention to use the proceeds of the public offering for strategic initiatives such as: expansion of manufacturing capacity, additional investment in more efficient internal power generation and to fund strategic partnerships. Further details on the intended use of the proceeds of the Invitation by the Company are contained in the Letter to Prospective Investors.

The Selling Shareholders intend to use the proceeds of the sale of their Shares in the Company for their own purposes.

Assuming all categories of Shares in the Invitation are fully subscribed/purchased, the expected proceeds and uses are as follows:

USES Amount (J$ millions)

Strategic Initiatives (net of expenses) 1,121

Issuance Fees (including expenses relating to this offer) 200

Sale of Shares by Selling Shareholders (net of expenses) 4,764

TOTAL 6,085

THE INVITATION (Continued)

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The Company and the Selling Shareholders also intend to pay the expenses associated with the Invitation out of the proceeds derived from the subscription/purchase of the Shares. The Company estimates that the expenses in the Invitation will not exceed J$200 million (inclusive of financial advisory, lead brokerage and arranger fees, legal fees, accountant’s fees, Registrar’s fees, filing fees, stamp duty fees, initial listing fees, marketing expenses, and exclusive of GCT).

KEY DATES

DESCRIPTION DATES

Prospectus On or about 28 November 2017

Roadshow 1 December 2017

Opening Date 6 December 2017

Closing Date 15 December 2017

Pricing and allocation announced Within 3 days of the Closing Date

Expected commencement of trading (if the Invitation is successful) Within 30 days of the Closing Date

Expected dispatch of investor statements and any refund if required

Within 10 days of the Closing Date

Normal trading of shares Within 45 days of the Closing Date

TERMS AND CONDITIONS FOR APPLICANTS

1. All Applicants (whether Reserved Share Applicants or members of the general public) must submit an Application Form as provided at Appendix 1 to this Prospectus. Reserved Share Applicants must specify their status on the Application Form and verifiable proof of such status must be presented.

2. All Applicants will be deemed to have accepted the terms and conditions of the Invitation and any other terms and conditions set out in this Prospectus, including any terms and conditions set out in this Section 6 and Appendix 1.

3. Each Applicant acknowledges and agrees that:

a. he/she/it has been afforded a meaningful opportunity to review the Prospectus (including the terms and conditions set out in this Section 6), and to gather and review all additional information considered by him/her/it to be necessary to verify the accuracy of the information contained in this Prospectus;

b. he/she/it has not relied on the Company or any other connected persons in connection with his/her investigation of the accuracy of such information or his/her/its investment decision; and

c. no person connected with the Company has made any representation concerning the Company or this Prospectus not contained in this Prospectus, on which the Applicant has relied in submitting his/her/its Application Form.

4. Application Forms from the general public must request a minimum of 1,000 Ordinary Shares and shall be made in multiples of 100 Ordinary Shares. Application Forms from the general public in other denominations will not be processed or accepted.


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5. The full amount payable for the Shares for which you are applying (being the number of Shares, multiplied by the Subscription Price per Share) plus JCSD processing fee of JMD 163.10 (inclusive of GCT) must be paid in one of the following 3 ways.

i. By Real Time Gross Settlement System (“RTGS System”) to the Broker using the following information, and evidence of such payment supplied with the completed and signed Application Form:

NCB CAPITAL MARKETS LIMITED Bank: National Commercial Bank Jamaica Limited BIC: NCCMJMK1 Branch: 1-7 Knutsford Boulevard (New Kingston) Account Name: NCB Capital Markets Limited Beneficiary Address: NCB Atrium, 32 Trafalgar Road, Kingston 10 Account number: 351422580 (Please include the applicant’s name in the transaction details of the RTGS)

ii. Applicants who have an investment account with the Broker may submit to them a letter of instruction to the Broker authorising the Broker to apply funds standing to the credit of such Applicant against the Subscription Price payable in respect of their application for Shares.

iii. Payment may also be made via a J$ Manager’s Cheque drawn on a Jamaican commercial bank made payable to “Wisynco Group Limited” or the Broker and will be accepted only in respect of payments for less than J$1,000,000.00.

6. All completed Application Forms must be delivered to NCB Capital Markets Limited c/o of branches of National Commercial Bank Jamaica Limited (“NCB”) at the following locations:

NCB 1-7 Knutsford Blvd, Kingston, Jamaica, W.I.

NCB Half-Way Tree, 94 HWT Rd., Kingston, Jamaica, W.I.

NCB Matildas Corner, 15 Northside Plaza, P.O. Box 72, Kingston, Jamaica, W.I.

NCB St. Jago, St. Jago Shopping Centre, St. Catherine, Jamaica, W.I.

NCB University Branch, Mona Campus, Kingston, Jamaica, W.I.

NCB Portmore Lot 18 West Trade Way, Portmore, St. Catherine, Jamaica, W.I.

NCB Duke & Barry Street 37 Duke St., Kingston, Jamaica, W.I.

NCB Constant Spring, 124-126 Constant Spring Rd., Kingston, Jamaica, W.I.

NCB Cross Roads, 90-94 Slipe Rd. P.O. Box 5 Kingston, Jamaica, W.I.

NCB Atrium, 32 Trafalgar Road, Kingston, Jamaica, W.I.

NCB Baywest Centre, Harbour St. Montego Bay, Jamaica, W.I.

NCB Santa Cruz, Santa Cruz P.O., St. Elizabeth, Jamaica, W.I

NCB St. Ann’s Bay 19-21 Main St. St. Ann's Bay, St. Ann, Jamaica, W.I

7. All Shares in the Invitation are priced at the Subscription Price of J$7.87 per Share (subject to discounts in respect of Reserved Shares, where applicable).

8. Application Forms submitted to NCB Capital Markets in advance of the Opening Date (early applications) will be received but not processed until the Opening Date. All advance applications will be treated as having been received at 9:00 a.m. on the Opening Date, 6 December 2017, and shall be allotted pro rata. All Application Forms received from 9:00 a.m. onwards on the Opening Date will be time stamped for processing in the order in which they were received. That is, the Application Forms will be processed on a first come, first served basis. Application Forms that meet the requirements set out in this Section 6 will be processed.


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9. For the purposes of paragraph 8 above the Directors of the Company, in their sole discretion, may:

a. Accept or reject any Application Form in whole or part without giving reasons, and neither the Company nor the Directors shall be liable to any Applicant or any other person for doing so; and

b. Allot Shares to Applicants on a basis to be determined by it in its sole discretion. Multiple applications by any person (whether in individual or joint names) may be treated as a single application.

10. Neither the submission of an Application Form by an Applicant nor its receipt by the Company will result in a binding contract between the Applicant and the Company. Only the allotment of Shares by the Registrar on behalf of the Company to an Applicant (whether such Shares represent all or part of those specified by the Applicant in his/her Application Form) will result in a binding contract under which the Applicant will be deemed to have agreed to subscribe for/purchase the number of allotted Shares or Sale Shares at the Subscription Price, subject to the Articles of Incorporation and these terms and conditions set out in Section 16.

11. If the Invitation is successful in raising at least J$5.82 billion as per Rule 402 of the Jamaica Stock Exchange Main Market Rules, and the Shares are admitted to trade on the Main Market, successful Applicants will be allotted Shares for credit to their account at the Registrar specified in their Application Forms. Applicants may refer to the informational notice that will be posted on the website of the JSE (www.jamstockex.com) after the Closing Date. Applicants who wish to receive share certificates must make a specific request to the Registrar.

12. With respect to refunds that are less than the RTGS threshold of $1 Million, the Company will endeavour to return cheques for the amounts refundable to Applicants whose applications are not accepted, or whose applications are only accepted in part, to NCB Capital Markets within ten (10) days after the Closing Date (or the extended Closing Date, as the case may be) or as soon as practicable thereafter. Each refund cheque will be sent to NCB Capital Markets for collection by the Applicant (or the first-named joint Applicant) stated in the Application Form. Any other persons purporting to collect a cheque on behalf of the Applicant must be authorised in writing by the Applicant(s) to do so. All refunds of a quantum greater than the RTGS threshold of $1 Million, will be refunded via RTGS to the account of origin.

13. Applicants must be at least eighteen (18) years old. However, Applicants who have not yet attained the age of eighteen (18) years, may apply jointly with Applicants who are at least eighteen (18) years of age.

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7. INFORMATION ABOUT THE COMPANY

THE COMPANY AND ITS HISTORY

Wisynco Group Limited is a prominent Jamaican manufacturer and distributor. It imports brands of food and beverage products and produces its very own lines of high quality products including BIGGA, WATA, various cranberry flavoured WATA, Boom and Sweet Synthetic Packaging Products. The Company in its present form is a result of an amalgamation of the following companies: West Indies Synthetic Company Limited (formed in 1965), Wisynco Trading (formed in the 1930’s and Jamaica Drink Company (formed in 1995). For the purposes of this section these entities will be collectively referred to as Wisynco.

Timeline – Key Highlights of the Company

Origins: 1965 t0 1995

1965

1966 - 1968

1971-1973

1995 - 1996

The Legacy Wiysnco companies was founded by Mr. Saleem Mahfood who arrived in Jamaica in 1921. Mr. Mahfood left his company to his four sons, where the brothers formed West Indies Synthetics Company Ltd {WISYNCO}. Wisynco borrowed £150,000 from Barclays Bank to build and equip a 6,000-square-foot factory at Twickenham Park in St. Catherine. The new plant started production and manufactured 60 pairs of boots per hour. Soon farmers, casual labourers, factory workers, and anyone needing protection from the elements would be sporting Jamaican-made Iron Man water boots. Initially Wisynco introduced a double-shift system to keep up with growing demand, and when that still was not enough, expanded to three shifts.

Wisynco exchanged (swapped) out its equipment with a Haitian producer of men’s shoes, and started producing Gator Shoes, a full range of men’s and children sneakers, casual and dress shoes . The Gator brand of footwear was the most popular products that rolled off its production line. Growth continued even during the 1970s when several other investors pulled out of Jamaica because of their disagreement with the policies of the then Administration. In fact, by the end of that decade, Wisynco required 60,000 square feet of production/warehouse space in order to supply the Jamaican market with its expanding range of products.

The company borrowed US$3 million and set up a 10,000 square-foot carbonated soft drink manufacturing plant

Birth of Wisynco in 1965

Wisynco started production of cups and containers in 1973

Wisynco started exporting Iron Man water boots to Trinidad & Barbados in 1966

BIGGA Soft Drink was born in 1995

In 1968 Wisynco expanded production with its second line, “Mr. Robin” plastic shoes and boots for children. Factory space increased to 12,000 square feet by the middle of the 1960s, and by the end of that decade to 20,000 square feet

Wisynco Fisheries division - 1997

Saleem Mahfood - 1921

INFORMATION ABOUT THE COMPANY (Continued)

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How has the Company Evolved: 2000 t0 2017

CORPORATE STRUCTURE

Wisynco Group Limited is a limited liability company incorporated on 9 April 1999 and is domiciled in Jamaica. The Company changed its name from Duke Services Number 7 Limited to Wisynco Group Limited on 25 April 2000. It has its registered office at Lakes Pen, St. Catherine, Jamaica.

The parent company is Wisynco Group (Caribbean) Limited, a Barbados International Business Company.

The ultimate controlling party of the Company is Evesam Investments Holdings Limited, a company incorporated in and resident the Cayman Islands.

The Company retains a subsidiary, Indies Insurance Company Limited, which was incorporated in 2011 and is resident in St. Lucia. The principal activity of Indies Insurance Company Limited is to provide insurance services to its parent and other group affiliates. Indies has no employees and its operations were dormant in FY 2015 and FY 2016.

The Company effected a Scheme of Reconstruction which commenced on 30 October 2017. This resulted in the Company retaining primarily its core businesses by transferring three non-core businesses to its ultimate parent company through intermediary companies. The reconstruction was approved by the relevant authority. See further details of the reconstruction in Section 8 below. Also Refer to Section “Details of Authorized and Issued Share Capital and the Shares in the Invitation’” for details on the recent reconstruction of the share capital of the Company.

2000 - 2006

2010 - 2012

2014 - 2015

2016 - 2017

Additionally, Wisynco began distributing Coca-Cola products on a non-exclusive basis. Wisynco Group Limited formed as a result of the amalgamation of the three companies – West Indies Synthetics Limited, Wisynco Trading Limited, andJamaica Drink Company Limited.

In 2010 Wisynco began to manufacture and distribute the first locally producedenergy drink BOOM. In March of that year, the company announced it will be the exclusive distributor of the world’s leading energy drink Red Bull. By December,Wisynco announced that they would be the exclusive bottlers and distributors forthe Coca Cola products.

The Wisynco Group celebrates 50 years of existence in 2015

In May 2016 the company’s warehouse was engulfed by a massive fire. During thattime no jobs were lost and distribution was not interrupted. By September 2017, thecompany rebuilt its warehouse into new modern state of the art complex.

Wisynco introduced its own purified artesian bottled water called WATAin 2002

Golden Jubilee

In 2010 BOOM was born

The company restarted operation after a massive fire in 2016

The Introduction of WATA - 2016

State of the art facility – Sept 2017


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COMPANY VALUES

The Wisynco Family has grown exponentially over the years, and has weathered many challenges together: each making it stronger along the way. Through it all, they have been led by the guiding principles of their founding fathers, who maintained that their priorities in life should be God first, Family second, Country and then Company.

The Wisynco Team conceptualized the acronym C.H.I.R.P. which speaks to the values of Compassion, Humility, Integrity, Respect, and Passion. These guiding principles define the Wisynco Way by which all Wisynco employees strive to live.

BUSINESS MODEL

Wisynco Group Limited is a Jamaican manufacturer and distributor. The Company takes great pride in offering quality products to the Jamaican market at competitive prices. The Company’s goal is to remain the premier distributor and manufacturer of food and beverages in Jamaica. This will be achieved by redefining and developing brand categories to improve overall sales. The variety of brands and package offerings the Company has in its portfolio provide the flexibility to reach all Jamaican consumers.

The primary activities of the Company are the bottling and distribution of purified water and beverages and the manufacturing of a wide range of plastic and foam packing and disposable products mainly used in the retail, food service and tourism industry. At present the Company distributes 110 brands with over 4,000 different products.

Market Positioning and Customer Base

The Company has a direct customer base of over 10,000 customers. This is made up primarily of restaurants, supermarkets, retail and wholesale channels, schools and food service outlets. It offers its products through distributors in Jamaica, Antigua, Bahamas, Trinidad, Grenada, Dominica, St. Lucia, Canada, Barbados, St. Vincent, Guyana, Belize, Curacao, Grand Cayman, the United Kingdom, the United States, Aruba, Panama, St. Kitts and Suriname. Wisynco prides itself on creating a differentiated customer experience, as such the focus is on providing innovative product offerings and superior customer care resulting in a high degree of customer loyalty.

The average Jamaican consumes a Wisynco product at least once every two (2) days


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The Company’s estimated market share by product category is shown below:

The Company’s primary competitors are Pepsi, Grace Kennedy, Seprod and Lasco.

Product Categories

Manufactured – Owned – this is the Company’s owned manufactured products such as the beverages WATA, cranberry flavoured WATA, BOOM, and BIGGA as well as SWEET branded disposable products packaging products.

Manufactured – Third Party – This includes branded products such as Coca-Cola, Hawaiian Punch and SqueezZ juices that the Company makes through agreements with third parties.

Distributed – Imported Third Party – this is the portfolio of products arising from the Company’s distribution agreements with foreign entities such as Red Bull, Kellogg’s, General Mills and Nestle.

Distributed – Local Third Party – this is the portfolio of products arising from the Company’s distribution agreements with local entities. Main brands include Tru-Juice and Freshhh.

Export – These are all products that the Company sells to foreign customers.

Suppliers

The Company has a number of suppliers in the United Kingdom, Turkey, USA, Ireland, China, Puerto Rico and Costa Rica from whom it obtains its raw materials. These suppliers provide mainly the raw materials for bottle and label manufacturing as well as sugar, flavours and other ingredients for beverage manufacturing. The Company maintains strong relationships with its key suppliers to minimize the risk of disruption in supplies. Refer to the Section “Contracts” for details on contracts with suppliers.

STRATEGIC GOALS

Wisynco Group has a proven track record of creating and growing renowned brands, successfully ensuring each gains island wide acceptance and availability in the Jamaican trade through relentless focus on operational efficiency and customer service. In keeping with this approach, the Company has partnered with internationally recognized food and beverage brands around the globe helping international giants such as Coca-Cola, Red Bull, Kellogg’s, Nestle, General Mills, Welch’s, Herr’s, and countless others, gain a foot hold in the local market. This combination of Company-owned and international brands has helped Wisynco achieve economies of scale in manufacturing and distribution that are unmatched by local competitors. The Company’s goal is to maintain a laser focus on the customer and continue to drive strong operating profit margins through sustained investments in talent development, infrastructure and systems in order to maximize volume and efficiency opportunities.

Increased profitability will be achieved through a combination of:

Organic growth of existing brands (both manufactured and imported) supported by continued investment to expand manufacturing and distribution capacities;

Increased focus on export markets – again supported by increased manufacturing capacity in particular. Approximately 1% of the Company’s revenue is currently derived from export markets;

Creation and growth of new owned-brands – particularly in select beverage categories where the Company currently has no presence; and

Juices* - 50% Non-carbonated beverage - 40%

Carbonated soft drinks - 42% Bottled water - 60%

Energy drinks - 85%

*This represents sale of products for Tradewinds Citrus Limited through an exclusive distribution agreement.


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The acquisition of additional distribution agreements and strategic partnerships to support revenue growth through international and local brands/companies.

Greater efficiencies will be created through:

Increased volumes arising from the initiatives above, thereby increasing both return on assets and operating profitability;

Achieving greater energy efficiency through additional investments in alternative energy sources and utilization;

Continued packaging innovation to reduce unit costs while limiting environmental impact;

Investment in modernized IT systems to ensure greater optimization of distribution resources;

Constant review of Sales, Distribution and Administrative (SD&A) costs to ensure the Company is operating at maximum efficiency levels; and

Continued talent development and expansion of sales personnel to ensure full customer satisfaction by intense focus on customer demands.

OPERATIONS AND DISTRIBUTION

Head Office and Distribution Centre

Wisynco operates at two main locations situated in St. Catherine: White Marl and Lakes Pen. Manufacturing takes place at White Marl, while Lakes Pen carries out distribution activities. Total square footage with factory, storage and offices between the two locations is approximately 530,000 square feet. In addition to its owned properties, the Company temporarily leases storage facilities in St. Catherine and Clarendon. The factory is ISO9001.2008 and FSSC 22000 certified and Wisynco strives to adhere to the highest quality safety standards.


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State of the Art Beverage Production

Solar Plant


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Wastewater Treatment Plant

Warehouse fire and Implementation of Recovery Plan

Following a massive fire at the Company’s Lakes Pen warehouse and distribution centre in May 2016, Wisynco was back to full operating capacity within just six (6) weeks due to its agile management team and resilient employees who swiftly implemented the Company’s recovery plans. Wisynco temporarily leased an old garment factory in Spanish Town, St Catherine, to resume distribution of its products. Concurrently the Company sought additional space at Ferry, St Catherine, Industrial Terrace on Marcus Garvey Drive in Kingston, as well as rented space temporarily from Food for the Poor a registered charitable organization under the Charities Act. At the time many employees were worried about losing their jobs but Wisynco managed to retain all facility workers and remained committed to its mission, team members, and customers.

Demonstrating the true resilience of its management team and employees, Wisynco has risen from the ashes with the opening of the Sam Mahfood Distribution Centre on 15 September 2017, a mere 16 months from the complete destruction of its predecessor. During the rebuilding, Wisynco took the opportunity to undertake a massive upgrade and expansion of its warehouse facility. It now boasts a brand new state-of-the-art facility. The new warehouse, which is dedicated to the father of Chief Executive Officer Andrew Mahfood and one of Wisynco’s founders, the late Sam Mahfood, is approximately 350,000 square feet – 100,000 square feet larger than the previous facility.

The size of the Sam Mahfood Distribution Centre, is not the only thing that has been upgraded; the new facility will feature fire prevention technology to readily prevent a blaze from escalating. The Company is in the process of implementing an Early Suppression Fast Response fire system that will have a quicker response in the event such a disaster were to ever happen again. The system has 4,500 sprinklers, supported by a 2500 gallons per minute (GPM) fire pump and a 275,000-gallon water tank.


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Outside of the precautionary system, there have also been changes to improve productivity. This includes:

The implementation of a state of the art automated inventory and order picking system;

More efficient layout with flexible workstations;

A 100% increase in loading docks;

A 20% increase in illumination with state of the art light-emitting diode (LED) high-bay lights that will place a 30% reduction in energy consumption; and

Roofing insulation to reduce internal temperature.


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Distribution Coverage

Hard work and careful attention to its customers has allowed the Company to become one of the largest food and beverage distribution companies in Jamaica. With a focus on beverages and grocery items, the Company distributes both international and local products island-wide.

You can find Wisynco’s products in the average refrigerator, your favourite restaurant, or at any supermarket as the Company distributes to all channels: retail, wholesale, small “moms and pops” and food service outlets such as hotels and restaurants. The Company currently distributes brands for many of the top food manufacturers of the United States of America.

More than 6000 coolers and 1300

freezers

300+ contracted trucks and 60 owned

Over 350,000 Sq. Ft. of dry

goods space

700 sales related employees


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Brands Portfolio

Wisynco offers a strong portfolio of owned flagship beverage brands led by WATA, BOOM Energy Drinks, cranberry flavoured WATA and BIGGA Soft Drinks. The Company is also the sole manufacturer of Coca-Cola, Hawaiian Punch amongst other brands.in Jamaica. In addition, the Company is a major distributor of several third-party brands such as Red Bull Tru Juice and Kellogg’s.


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Owned Brands

Included below is an overview of the brands owned by the Company. These brands generate approximately 46% of the revenue earned by the Company.

Cranberry Flavoured-WATA: “WATA Wid Wow”

The phenomena behind the cranberry flavoured WATA began in 2008 when Wisynco innovatively created the flavored water category in Jamaica by combining its flagship WATA brand with cranberry juice. The naturally fruit flavoured water has four flavours: original cranberry, grape, strawberry and newly launched peach.

WATA

In 2002 Wisynco entered the bottled water market with the introduction of their own locally manufactured brand called WATA. WATA is bottled drinking water after going through an extensive purification process.

WATA maintains its standard of excellence through its filtration process, making the brand one of the more renowned bottled water in the country. The brand’s success is in its name, the lifestyle it conveys and its taste.

BIGGA

BIGGA soft drinks was the first beverage product that was developed by Wisynco. BIGGA has since been aligned with nationalism stemming from its local production and as one of the carbonated soft drink made locally. BIGGA has become one of the flagship brands of the Company.


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BOOM

Since the entrance of energy drinks to the Jamaican market, Wisynco’s vision was to develop a locally produced energy drink whose quality and taste could compete alongside popular brands in the category. After several years, Wisynco introduced BOOM to the local market in 2010.

Sweet

Wisynco is one of the largest plastic and foam manufacturer in the English speaking Caribbean. The Wisynco plastics and foam product line is reflective of the many years of research and care which has gone into the production of its range of synthetics. The Company has been taking initiatives to minimize its environmental impact. Refer to “Focus on the Environment” within this Section 7 for further details on the Company’s initiatives.

Products manufactured under the Sweet brand include: plates, cups, forks, spoons, egg cartons, meat trays, hamburger boxes and foam containers.


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TRADE MARKS

The Company decides whether to register trademarks in the countries in which it operates on a case by case basis according to need on the basis of usage, and local legal advice. The Company may not have registered its trade marks in all of the countries in which it operates based on such advice and, depending on the country, the Company may or may not benefit from other protection under the law, if a competitor was to introduce similar or identical names, logos or trade marks.

Locally registered trade marks

Countries Trade mark Registration date Registration status

Jamaica Iron Man By Wisynco 11-Feb-1967 Status-Registered

Jamaica Wisynco 11-Feb-1967 Status-Registered

Jamaica Iron Man Garbage Bags 07-Sept-1982 Status-Registered

Jamaica BIGGA 21-Sep-1995 Status-Registered

Jamaica Born a Yard 26-Sept-1997 Status-Registered

Jamaica RAM 26-Mar-1998 Status-Registered

Jamaica Chups 26-Mar-1998 Status-Registered

Jamaica WATA 30-Oct-2002 Status-Registered

Jamaica Mpowa 3-Nov-2006 Status-Registered

Jamaica Sweet Water 11-Mar-2009 Status-Registered

Jamaica Boom Energy Drink 24-Mar-2009 Status-Registered

Jamaica Sweet Water 26-Mar-2009 Status-Registered

Jamaica Gush 4-Jun-2010 Status-Registered

Jamaica WATA 22-Aug-2011 Status-Registered

Jamaica Boom Energy Unsung Beats

07-Nov-2012 Status-Registered

Jamaica Ironade 09-Aug-2013 Status-Registered

Jamaica Boom Shaka Boooom 09-Aug-2013 Status-Registered

Jamaica Coolahs 30-Aug-2013 Status-Registered

Jamaica Boom 08-Nov-2013 Status-Registered

Jamaica Boom Financials 08-Nov-2013 Status-Registered

Jamaica Boom Badda Dan 23-Jun-2014 Status-To be Published

Jamaica Boom TV 23-Jun-2014 Status-To be Published

Jamaica Badda Dan The Ultimate Dancehall Dance Battle Competition

23-Jun-2014 Status-Registered

Jamaica Boom City 23-Jun-2014 Status-To be Published

Jamaica Nutri Milk 20-Apr-2017 Status-Awaiting response


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Jamaica Ironade Energy 21-Apr-2017 Status-Awaiting response

Jamaica Zooper Dooper 25-May-2017 Status-Awaiting response

Jamaica Iron Aid Pending

Jamaica Sweet Pending

Overseas registered trade marks


Barbados* BIGGA 20-11-1998 Registered

Barbados* BIGGA Logo 23-08-1999 Registered

Barbados* Big Up 25-06-2009 Registered

Puerto Rico* BIGGA 09-03-1999 Renewal Pending

United States BIGGA (Stylized) 18-02-1997 Registered

Canada* BIGGA Logo Renewal Pending

Grenada BOOM ENERGY DRINK Logo

14-01-2013 Registered

* Registered in the name of Jamaica Drink Company Limited, a legacy entity. The Company is in the process of formally transferring these patents and trade marks.

REAL PROPERTIES

The Company is the registered proprietor of the four (4) properties that the Company occupies at its two locations, Lakes Pen and White Marl, which are situated in the parish of St. Catherine, Jamaica. The Lakes Pen properties are currently registered at the Register Book of Titles at the National Land Registry of Jamaica as follows:

Volume 1412 Folio 53



The White Marl property is currently registered at the Register Book of Titles at the National Land Registry of Jamaica with Volume 1100 Folio 110.


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MANAGEMENT AND EMPLOYEES

Wisynco has developed a unique corporate culture based on entrepreneurship, innovation, client focus and commitment to the communities served. The Company has a strong, highly experienced and committed team, with many years of experience in the manufacturing and distribution industry with deep knowledge of the local and international manufacturing and distribution markets. Many of its professionals have developed extensive experience in launching and building new products in the Jamaican market as well as new international markets. The Company has approximately 1,782 permanent employees and 353 contracted full time employees. Approximately eighty (80) employees or 4.5% of the Company’s permanent employees are administered under a collective labour agreement. Wisynco is committed to building talent and providing a safe and fair workplace for all employees while adhering to local labour laws and best-practices in all areas of its business.


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6%

1%

5%

27%

18%

43%

Staff By Deparment as at June 2017

Administration & Finance Information TechnologyMarketing OperationsProduction Sales


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Executive Management Committee

The Company has a strong, highly experienced and committed team of four (4) executive directors who are also direct/beneficial shareholders and six (6) management executives, who together comprise the Company’s Executive Management Team. The Committee is responsible for the ongoing execution of the Company’s strategic goals:

Refer to Section 9 “Directors and Management” for details on the qualifications and experience of the directors and management.

Profit Share Scheme

Wisynco operates an annual profit share scheme which rewards all employees with up to 15% of the Company’s net profit based on the overall Company performance. The allocation to each employee is based on their salary and performance.

Andrew Mahfood: Chief Executive Officer – Wisynco Group Ltd

William Mahfood: Chairman

Francois Chalifour: Director, Marketing & Product Development

Gerald Mahfood: Head of Operations

Jacinth Bennett: Group Financial Controller

Halcott Holness: Head of Sales

Caron Anderson: HR Services – Head of HR Services & People Development

Devon Reynolds: Director of Manufacturing

Sean Scott: Head of Strategy & Special Projects

Christopher Ramdon: Chief Information Officer

Andrew Fowles: Group Company Secretary


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PERMITS & LICENSES

The operations of the Company is subject to compliance with the various Acts and Regulations and certifications. The Company’s operations are regulated by agencies such as the Bureau of Standards, and the regulatory agencies of the Ministries of Health, of Agriculture, National Environmental and Planning Agency, Water Resources Authority and the Trade Board amongst others. A list of applicable permits and certifications are detailed in the table below.

Issuer Brief Description Expiration Date

Certificate of Compliance - GOJ Ministry of Industry, Commerce, Agriculture & Fisheries

Wisynco Group Limited was granted with Certificate of Compliance as at White Marl Industrial Complex, Spanish Town, St. Catherine by the Chief Food Storage Officer

31 March 2018

Certificate of Re Registration – The Chief Factory Inspector

Wisynco Group Limited has been registered under the Factories Act by the Chief Factory Inspector under the Factories Regulations, 1961 at White Marl St. Catherine by the Chief Factory Inspector

25 August 2018

Certificate (for Beverages manufacturing plant) – Bureau of Standards Jamaica

The Standards Act Certificate of Registration for Wisynco Group Limited as at White Marl Industrial Complex, Spanish Town, St. Catherine to process Carbonated Beverages, non-carbonated beverages, Purified & Flavoured Bottled Water and Energy Drink.

21 N0vember 2017

Renewal pending, temporary extension given

Fire Safety Certificate - Jamaica Fire Brigade

Wisynco Group Limited has been granted a certificate for an Industrial & Commercial premises at White Marl Industrial Complex, Spanish Town, St. Catherine.

November 2018

Fire Safety Certificate - Jamaica Fire Brigade

Wisynco Group Limited has been granted a certificate for an Industrial & Commercial premises at Lakes Pen, St. Catherine.

November 2018

R12/2016-R05/2012-A2007/06 – Water Resources Authority

Wisynco Group Limited is granted a licence to abstract and use water, subject to the provisions of the Water Resources Act and Regulations.

May 2018

*Food Safety System Certification 22000 – SGS United Kingdom Ltd Systems & Services Certification

Certificate from SGS UK Ltd Systems & Services Certificate which verifies the Wisynco Group Limited – White Marl, St. Catherine, Jamaica has met the necessary requirements to manufacture carbonated & non-carbonated beverages and bottled water, and the filling of CO2 cylinders for food use.

17 July 2018

ISO 9001:2008 – SGS North America, Inc.

Certified from SGS North America, Inc. Certificate which verified the Wisynco Group Limited – White Marl Industrial Complex, Spanish Town, WI, Jamaica has met the necessary requirements to design, develop and manufacture carbonated and non-carbonated beverages and bottled water; Design, develop and manufacture plastic cups, drinking straws and food containers; Filing of CO2 cylinders for fountain use; Warehousing and distribution of beverages, packaged ready-to-eat foods, and food service supplies.

17 July 2018


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Issuer Brief Description Expiration Date

Licenses to Operate a Treatment Plant for the Discharge of Sewage Effluent and to Discharge Sewage Effluent into the Environment - National Environment and Planning Agency (NEPA)

NEPA has granted license to Wisynco Group Limited of White Marl Industrial Complex, Spanish Town, St. Catherine to operate a waste treatment plant at Lakes Pen Road, Spanish Town St. Catherine.

4 October 2021

A FOCUS ON THE ENVIRONMENT

Over its years of operation, Wisynco has implemented a number of environmentally-conscious initiatives.

Eco-Foam and Lighter Weight Bottles

As the largest producers of Styrofoam and plastic in Jamaica, the Company has a vested interest to limit its environmental impact. In doing so, the Company recently began to introduce a special additive to its foam products that increase the rate at which the product breaks down in the environment. The Company has also continuously invested in manufacturing technology to reduce the amount of plastic used in each bottle of beverage it produces.


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Recycling

The Company has engaged in several recycling initiatives by partnering with the Government of Jamaica and companies from the private sector to form the non-profit public/private organization called Recycling Partners of Jamaica. The organization’s primary focus is on collecting post-consumer polyethylene terephthalate (PET) bottles for purposes of recycling. The Company has done this by facilitation of several collection depots across the island, which the Company intends to expand.

Solar Installations

The Company has made significant investments in solar power generation which has reduced its carbon footprint. This has allowed the Company to supplement the energy that it gets from Jamaica Public Service, to lower its energy cost, as well as become more environmentally friendly using a sustainable source of energy.


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Waste Water Treatment Plant

The Company has invested in a major wastewater treatment plant which ensures that the water leaving the factory is safe to re-enter the water table and be used in crop irrigation. In addition the Company has recently taken a decision at the board level to implement an environmental committee within the group to look at ways that the Company could environmentally friendly.

CORPORATE SOCIAL RESPONSIBILITY

BRAND INITIATIVES

All of the brands that Wisynco owns and distributes have a strong commitment to social responsibility and giving back to our Jamaican community of consumers.

BIGGA

The BIGGA brand has recently embarked on a major social media education campaign under the banner “Share with Care”. The aim is to sensitize high school students to effective, safe and responsible behaviours online and through social media channels like Facebook, WhatsApp and SnapChat.

WATA

WATA has become one of the leading sponsors of several walking/running events specifically 5K. Many of these events occur almost weekly in Jamaica.

The 5K phenomenon in Jamaica has been a great way for the brand to reward the runners with hydration, and to assist in the participants efforts to raise funds. Many of the 5Ks held in Jamaica these days have a philanthropic component. The Food for the Poor 5K is a prime example of this, as in its first year they raised over $46 Million to build homes for the needy in Jamaica. WATA also supports several fundraising events, such as Shaggy and Friends, and assists many institutions, such as Linstead Hospital, Food for the Poor, The Cancer Society, CUMI, amongst many others.

This year Wisynco through its WATA brand has joined with Jamaica’s Ministry of Health initiative called Jamaica Moves. Jamaica Moves has implemented many events to encourage Jamaicans to engage in physical activity and to improve their dietary habits. The WATA brand has invested heavily in monthly wellness activities though free exercise classes regularly held across the country.


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Wisynco Eco Club

This initiative speaks to the Company’s overall commitment to the environment with very strong focus on the collection of plastic bottles. The Eco Club was established to create excitement surrounding recycling through the theme – RECYCLING PLASTIC, FEELS FANTASTIC.

Additionally, the RECYCLE ME campaign was designed to encourage consumers to recycle by showcasing the usefulness of plastics as a viable raw material - plastics can be made into useful products as shopping bags, toys etc.

RECYCLING PLASTIC, FEELS FANTASTIC RECYCLE ME

Clean Coasts Project (CCP)

Wisynco serves as a corporate sponsor for the Clean Coasts Project (CCP) – an environmental initiative in collaboration with the Tourism Enhancement Fund (TEF) and the Jamaica Environment Trust (JET) to provide public education on environmental issues such as solid waste management and marine conservation. The well received Nuh Dutty Up Jamaica media campaign has been a highlight of the CCP, along with other seminars, research initiatives, school programmes, competitions and conservation themed field trips.


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Student Scholarships and School Sponsorship

Wisynco has long provided financial support for students and educational institutions across the country. The Company has provided millions of dollars in scholarship funds to youth at various educational levels to help cover tuition and other educational costs. Additionally, Wisynco through its Loyalty Programme provides funds for school improvement projects to those schools which carry Wisynco beverages and products on the schools’ compound.

Sports Sponsorship

Wisynco has fuelled the development of sports in Jamaica, having sponsored a number of sporting competitions and teams such as the ISSA/Flow Manning and DaCosta Cup schoolboy football competitions and Jamaica’s national netball teams and leagues. Wisynco is particularly committed to promoting healthy lifestyles and the participation of women in sports.

Hurricane Relief Efforts

Wisynco has been involved in hurricane relief efforts across the Caribbean in collaboration with other local companies. Wisynco has provided cases of water and other products to assist those who have suffered from the devastation of natural disasters.

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8. INCORPORATION AND STRUCTURE

The Company was incorporated on 9 April 1999 under company number 61,229 and on 25 April 2000, the Company changed its name to Wisynco Group Limited. The Company underwent an amalgamation exercise effected in 2005 with three Jamaican companies – West Indies Synthetics Limited, Wisynco Trading Limited, and Jamaica Drink Company Limited. These companies were subsequently dissolved.

The parent company is Wisynco Group (Caribbean) Limited, a Barbados International Business Company.

The ultimate controlling party of the Company is Evesam Investments Holdings Limited, a company incorporated in and resident in the Cayman Islands. The Company retains a subsidiary, Indies Insurance Company Limited, which was incorporated and resident in St. Lucia. The Company effected a Scheme of Reconstruction dated 30 October 2017, resulting in the Company retaining primarily its core businesses by transferring three non-core businesses to its ultimate parent company through intermediary companies. The reconstruction was approved by the relevant authority. See further details of the transaction in this Section 8, below.

The shareholders of the Company have approved and adopted new Articles of Incorporation with effect from 19 October 2017 and the re-registration of the Company as a public company.

DETAILS OF AUTHORIZED AND ISSUED SHARE CAPITAL AND THE SHARES IN THE INVITATION

Capital Structure of the Company

As at the date of this Prospectus, the authorised and issued share capital of the Company is as follows:

Authorised: 4,000,000,000

Currently Issued: 3,600,585,424

The Shares in the Invitation will be both newly and previously issued shares (the latter being the Sale Shares).

Following an Extraordinary General Meeting Shareholders’ meeting held on 19 October 2017, the following steps were approved in respect of the capital structure of the Company:

The reconversion of $1,035,000 stock units to 1,035,000 issued and fully paid up ordinary shares with an effective date for such reconversion to be and be deemed to be 1 March 2017.

The restructuring of all the authorized share capital of 1,100,000 shares of the Company by the sub-division of each ordinary share into 3,382 ordinary shares, pursuant to section 65(1) (d) of the Companies Act, 2004 (see illustrative Share Restructuring Table below).

After the above mentioned subdivision, the increase of the authorised share capital of 3,720,200,000 ordinary shares to 4,000,000,000 ordinary shares by the creation of 279,800,000 ordinary shares.

The issue of an additional 149,414,576 ordinary shares which are all being offered to the general public and/or the Reserved Share Applicants in the Invitation.

The re-registration of the Company as a public company under the provisions of the Companies Act, 2004.

The adoption of Articles of Incorporation, which are available for inspection as set out in Section 17 herein.

INCORPORATION AND STRUCTURE (Continued)

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SHAREHOLDINGS PRE-IPO

The current shareholding of the Company after the sub-division and increase of its Authorized Share Capital, the Company’s capital structure is as follows:

Existing Shareholders

Issued Shares Before

Subdivision of

Authorised Share

Capital

Issued Shares After the Sub-

Division of the

Authorized Share Capital

before allotment

Percentage Ownership

Ordinary Shares to be

issued During the IPO Process

Issued Share Capital

Percentage Ownership

Wisynco Group (Caribbean) Limited

1,000,000 3,382,000,000 93.93% - 3,382,000,000 90.19%

Caribbean Bottlers Trinidad and Tobago Limited

41,689 140,992,198 3.92% - 140,992,198 3.76%

Devon Reynolds

10,540 35,646,280 0.99% - 35,646,280 0.95%

Francois & Michele Chalifour

10,540 35,646,280 0.99% - 35,646,280 0.95%

George Shammas

1,863 6,300,666 0.17% - 6,300,666 0.17%

Ordinary Shares to be issued during the IPO Process

- - - 149,414,576 149,414,576 3.98%

Total Shares 1,064,632* 3,600,585,424 100% 149,414,576 3,750,000,000 100%

* - includes $1,035,000 stock units, which were reconverted into ordinary shares


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SHAREHOLDINGS POST-IPO

Upon closure of the Invitation, assuming all categories of Shares in the Invitation are fully subscribed/purchased by the public and the Reserved Share Applicants, the respective shareholders and their respective percentage shareholdings in the Company will be as follows:

Name of Shareholder Issued Share Capital Percentage Ownership

Wisynco Group (Caribbean) Limited 2,887,906,774 77.011%

Caribbean Bottlers Trinidad and Tobago Limited - 0.000%

Devon Reynolds 35,646,280 0.951%

Francois & Michele Chalifour 35,646,280 0.951%

George Shammas 6,300,666 0.167%

Employees 112,500,000 3.000%

Strategic Investors 150,000,000 4.000%

Broker 52,200,000 1.392%

General Public 469,800,000 12.528%

Total 3,750,000,000 100.000%

GROUP RECONSTRUCTION

On 30 October 2017, the Company effected a Scheme of Reconstruction (“reconstruction”) resulting in the Company retaining primarily its core businesses of manufacturing, bottling, distribution of beverages, synthetic packaging, food items and other products. This reconstruction was approved by Tax Administration Jamaica under the laws of Jamaica.

As a consequence of the reconstruction, the Company transferred its non-core businesses to separate legal entities that are not associates (as defined by the Companies Act of Jamaica) of the Company but will remain related parties given the commonality of the ultimate parent company. The businesses transferred were:

Wisynco Foods Limited - this company is engaged in the preparation and sale of meals under the Wendy’s and Domino’s quick service restaurant brands.

Seville Development Corporation Limited – this is a land holding company with no other operations.

In furtherance of the reconstruction, the Company’s investment in Fusion Holdings Limited was transferred to a separate legal person. As at the date of the Prospectus, arising from the reconstruction, the Company holds no legal or equitable interest in Wisynco Foods Limited, Seville Development Corporation Limited or Fusion Holdings Limited.


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Shown below are the entities that are expected to be excluded from the Audited Financial Statements of the Company as at 30 June 2017 as a result of the reconstruction.

Financial Impact

These investments were carried at cost in the Company’s balance sheet (both audited as at 30 June 2017 and unaudited as at 30 September 2017), with a carrying value of J$583m. The impact of the reconstruction of the Company’s financial statements are reflected in the pro-forma financial statements as outlined in Section 12.

The financial statements for the Company included in this Prospectus reflect the results of the core businesses of the Company on a stand-alone basis and not on a consolidated basis (i.e. it excludes any financial results of Wiysnco Foods Limited, Seville Development Corporation Limited and Fusion Holdings Limited).

Wisynco Group Limited

Indies Insurance Co. Ltd. (100%)

Seville Development

Corp. Ltd (85%)

Fusion Holdings Ltd.

(50%)

Wisynco Foods Ltd (100%)

Wisynco Group (Caribbean) Limited

(93.93%)

Other Shareholders (6.07%)

Excluded from IPO

Evesam Investments Holdings Limited (62.2%)


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MATERIAL CONTRACTS

Financial

Date Counterparty Brief Description

December 12th, 2011

MF&G Trust & Finance Limited

Master agreement for lease on equipment. If there is no breach of Master Agreement Wisynco may continue after the expiration of the master Agreement for a period of 20 years. If they wish to not continue the lease they must give a written notice to MF&G or Wisynco will automatically extend the Lease. If an extension occurs the annual rental payable will be J$1.00.

January 30th, 2015 National Commercial Bank Jamaica Limited

Term loan of J$200M for the construction of a 1MW solar power energy plant. The term loan matures no later than 60 months after disbursement with an interest rate of 9.563% p.a. payable on a quarterly basis. This loan is unsecured.

September 26th, 2016

National Commercial Bank Jamaica Limited

Term loan of J$1.9B. Tenor of the loan is 7 years from the date of disbursement with interest payable quarterly at 8.75% p.a. This loan is unsecured.

October 9th, 2017 The Bank of Nova Scotia Jamaica Limited

Non-revolving term loan of J$725M for the financing on the purchase and installation of new machinery for the Company’s bottling plant being undertaken. Loan matures in 72 months (7 years) from the initial disbursement at a fixed interest rate of 7.9% p.a. payable monthly in arrears. This loan is unsecured

The Company has not yet drawn down on this facility.

Property Leases

The Company entered into leases for the following premises on arm’s length commercial terms:

Property Counterparty Brief Description

Ferry, St. Catherine

Tankweld Metals Limited Lease of 36,000 sq. ft. of warehouse space. This lease will expire in June 2018 and is not expected to be renewed.

Longville, Clarendon

CB Foods Limited Lease of cold storage facilities. This lease will expire in March 2018 and is not expected to be renewed.


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Supplier Contracts

Primary contracts

Coca-Cola: In 2010 the Company acquired the right to exclusively bottle and distribute Coca-Cola products in Jamaica. The original 3 year contract was executed in May 2012 and is currently under negotiation for renewal. Until renewal is formally executed Coca-Cola has granted the Company rolling quarterly extensions. As such, the Company continues to manufacture and sell Coca-Cola products exclusively in Jamaica under the terms and conditions of the 2012 agreement. In all respects, the Company is compliant with its obligations under that agreement. Coca-Cola products represent approximately 12% of the Company’s revenue.

Trade Winds Citrus Limited: Wisynco has licensing and distribution agreements with Trade Winds Citrus Limited (“Trade Winds”), where Trade Winds supplies various fruits, juices, and other beverages to Wisynco, who has exclusive rights to distribute its products throughout Jamaica. The specific products include Tru Juice, Freshhh, Calico Jack and Wakefield. Wisynco also manufactures and distributes the SqueezZ brand as per the aforementioned licensing agreement. In addition to distributing products throughout Jamaica, Wisynco can also distribute products to countries outside of Jamaica with Trade Winds’ consent. The products that fall collectively under these two agreements represent approximately 18% of the Company’s revenue.

Other contracts

The brands/entities listed below individually represent no more than 3.4% of total revenues.

Item Class Material Exclusive Supply [Y/N]

Comment - Exclusive Supply

Keebler/Kellogg’s (Mexico/Refrigerated)

Snacks & Cereals Y Distribution Agreement governed by Contractual agreement with annual Business Plan sign-off. Wisynco is the only authorized distributors in Jamaica and buys directly from supplier/plants.

Caribbean Bottlers (USA, Barbados & T&T)

Beverage - All type Y Distribution Agreement governed by Contractual agreement. Renewed as needed. Annual target set & agreed

General Mills - Grocery Assorted Grocery Y Distribution Agreement governed by Contractual agreement. Wisynco is the only authorized distributor in Jamaica and buys directly from supplier/plants.

Dr Pepper (Motts, Haw Punch, Mistic/Snapple)

Beverage - Non-Carbonated

Y Distribution Agreement governed by Contractual agreement. Wisynco is the only authorized distributor in Jamaica and buys directly from supplier/plants.

Welches - (Dry & Chill) Beverage - Non-Carbonated

Y Tenants governed by Contractual agreement. Renewed at intervals


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Pringles Int'l Corp Snacks - Potato Chip

Y Distribution Agreement governed by Contractual agreement with annual Business Plan sign-off. Wisynco is the only authorized distributors in Jamaica and buys directly from supplier/plants.

Hershey Foods Confectionery - Chocolates

N Distribution Agreement governed by Contractual agreement. Wisynco only authorise distributors’ buys directly from supplier/plants.

Herr’s Chips Snacks - Potato Chip

Y No official contract in place. However distribution agreement governed by extensive years of partnership. No presence of parallel items in trade

Nestle (Ice Cream) - (Pr,Edys,Hof)

Ice Cream & Frozen Novelties

Y Exclusive supply governed by Contractual agreement. Renewed via bidding process. No parallels trade.

Lamb Weston Potato Y No Contract. Supplier only sell to us with no sign of parallels products.

Ajover Plastic & Styrofoam containers

N No Contract. Vendor sell to other company locally but focus specific SKUs per distributor.

Helados Bon,S.A.(I/Cream)

Ice Cream & Frozen Novelties

Y Distribution agreement in place and Wisynco only distributor. No parallels in the market.

Red Bull(Energy Drink) Beverage - Energy Drink

Y Distribution Agreement governed by Contractual agreement. Parallels SKUs from the USA have been discovered in the market despite Wisynco’s exclusive license to import.

Other

The Company has one Collective Labour Agreement in place with the National Workers Union which represents approximately eighty (80) employees from the plastics division. This represents approximately 4.5% of the Company’s full time employees. This agreement will expire on 30 June 2019.

LITIGATION

As at the date of this Prospectus, the Company is not involved in any litigation, arbitration or similar proceedings pending and/or threatened against the Company.


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DIVIDEND POLICY

The Directors expect the Company’s investments and strategic plans which are to be implemented in the short to medium term, will result in growth of its profits, subject to any adverse changes in the local and regional economic climate. Accordingly, the Directors anticipate a payment of an annual dividend of at least 20% of the annual profits after any applicable income tax, where such profits are available for distribution, and subject to the Company’s need for reinvestment of some or all of its profits from time to time in order to finance its further growth and development.

INSURANCE ARRANGEMENTS

Wisynco’s current insurance policies are listed below. All policies are subject to renewal on 1 July 2018.

Class of Insurance Insurer

Commercial All Risk & Business Interruption - Local Placement (68.5%)

Indies Insurance Company Limited et al

Commercial All Risk & Business Interruption including Machinery Breakdown - Overseas Placement (31.5%)

Indies Insurance Company Limited

Low Voltage Plant & Equipment including Machinery Breakdown

Indies Insurance Company Limited et al

Boiler & Pressure Vessel Indies Insurance Company Limited

Computer All Risks Indies Insurance Company Limited

Public & Products Liability Indies Insurance Company Limited

Excess Comprehensive General Liability Indies Insurance Company Limited

Fidelity Guarantee Indies Insurance Company Limited

Loss of Money Indies Insurance Company Limited

Goods in Transit General Accident Insurance Jamaica Limited - (Lead), GK General Insurance Company & Guardian General Insurance Jamaica Limited.

Goods in Transit Indies Insurance Company Limited

Private Motor Comprehensive - (Production of Plastics, Foam Products & Soft Drinks)

Guardian General Insurance Jamaica Limited.

Private Commercial Motor Comprehensive - (Production of Plastics, Foam Products & Soft Drinks)


Private Motor Third Party - (Production of Plastics, Foam Products & Soft Drinks)


Private Commercial Motor Third Party Guardian General Insurance Jamaica Limited.

Motor Cycle Third Party Guardian General Insurance Jamaica Limited.

Motor Contingent Liability Guardian General Insurance Jamaica Limited.


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Confirmation of the insurance arrangements referred to in this section will be available for inspection as described in Section 17.

CHARGES REGISTERED AGAINST THE ASSETS OF THE COMPANY

Charges

As at the date of this Prospectus, the following charges are registered against the assets of the Company. These relate to the purchase of motor vehicles under a finance lease. The total balance outstanding as at the date of the Prospectus is J$52 million.

No. Date Registered Lapse Date Charge Document Institution (Chargee)

1 25 March 2014 25 March 2024 Notice of Security Interest - 1002543837

MF&G Asset Management Ltd

2 2 January 2014 2 January 2024 Notice of Pre-Existing Security Interest - 1002876043

MF&G Trust & Finance Ltd

















11 1 April 2014 1 April 2024 Notice of Security Interest - 100321633







Trustees Seramco Limited Superannuation Fund








54









22 11 July 2014 11 July 2024 Notice of Security Interest - 1009630439




24 30 September 2014

30 September 2024

Notice of Security Interest - 1010749352


25 15 October 2014 15 October 2024 Notice of Security Interest - 1011877277

National Commercial Bank Jamaica Limited





28 19 November 2014 19 November 2024

Notice of Security Interest - 10131675 (Amendment)





30 6 February 2015 6 February 2025 Notice of Security Interest - 1013810486








34 7 September 2015 7 September 2025



35 24 September 2015

24 September 2015






37 19 February 2016 19 February 2026


Sidel Blowing and Services SAS




55



40 16 May 2016 16 May 2026 Notice of Security Interest - 1016640538




Guarantees

Letter of Guarantee Established

Amount Secured by Charge

Expires In Favour

23 January 2009 J$4,500,000 31 December 2099 Collector of Customs

25 December 2002 J$2,000,000 31 December 2099 Collector of Customs



03 December 2003 J$1,000,000 31 December 2090 The Collector of General

TAXATION

The Company incurs corporation tax at a rate of 25%. Taxation expense in the statement of comprehensive income comprises current and deferred tax charges.

Current tax charges are based on taxable profits for the year, which differ from the profit before tax reported because it excludes items that are taxable or deductible in other years, and items that are never taxable or deductible. Deferred tax is the tax that is expected to be paid or recovered on differences between the carrying amounts of assets and liabilities and the corresponding tax bases. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

The Company’s liability for current tax and deferred tax is calculated at the corporation tax rate of 25%.

The Company’s Tax Compliance Certificate as at 26 September 2017 is available for inspection.

PRE- IPO DIVIDEND

On 19 October 2017, the Shareholders approved the payment of a dividend of approximately US$8 million which represented surplus cash i.e. cash not required for operations or debt repayment. The impact of this transaction has been reflected in the Pro-Forma adjustments as seen in Section 12.

PRE- IPO SETTLEMENT OF RELATED PARTY DEBT

As at 30 September 2017, the balance due to its parent company Wisynco Group (Caribbean Limited) was approximately J$263 million. This represented promissory notes which were issued in consideration for the transfer of the investments in subsidiaries to the Company in 2003 and attract interest at 5% per annum and were repayable in 2011. This balance was settled prior to the Opening Date. The impact of this transaction has been reflected in the Pro-Forma adjustments as seen in Section 12.


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EMPLOYEE SHARE OWNERSHIP PLAN

The Company is also exploring mechanisms for rewarding key talent by providing them with an Employee Share Ownership Plan (“ESOP”) in the form of a Share Option Scheme. This will give key management (to be determined at a later date) the right to purchase shares at a specified price for a set number of years into the future. The right to exercise the option will be effective only after certain vesting requirements are met; such as working for a number of years or meeting a performance target.

The strike price for each option will be fixed at grant date to be determined by the Board of Directors and is expected to be at the market price at the respective grant date. Under the proposed Share Option Scheme, only for the first pool of options to be granted eligible members will have the opportunity to purchase Ordinary Shares at the Subscription Price of J$7.87 contained herein.

In funding the ESOP Scheme, the following are being considered:

The Company will increase its share capital by no more than 5% over a period of 5 years hereof; and

Thereafter, the Company may repurchase trading shares in the future.

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9. DIRECTORS AND MANAGEMENT

BIOGRAPHICAL DETAILS OF DIRECTORS AND MANAGERS OF THE COMPANY

NON-EXECUTIVE DIRECTORS

John Lee

John Lee is Chairman of 138 Student Living, having conceptualised and implemented the idea in 2013 of 'on campus' student housing.

Up to retirement in 2013, John was a Director/Partner in PricewaterhouseCoopers (PwC) Tax and Advisory Services Limited, with 35 years of accounting and business experience obtained through corporate and project finance, insolvency and business turnaround, litigation support and auditing assignments.

He has assisted companies in the public and private sectors in their structuring of corporate and project financing and led the PwC team in advising clients on access to the local and international capital markets for corporate and project finance.

John holds a M.Sc. in Finance and is a retired member of the Chartered Association of Certified Accountants.

John is also a member of the Company's Audit & Risk and Compensation & Governance Committees.

DIRECTORS AND MANAGEMENT (Continued)

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Lisa Soares Lewis

Lisa, a Jamaican national, is the Founder/CEO of Great People Solutions that she created following her Human Resources Director roles in DIAGEO Jamaica (Red Stripe) and North Latin America and the Caribbean (NorthLAC). Her career has spanned 20+ years across a range of local and global businesses in banking, telecoms, and FMCG industries including DIAGEO, Cable & Wireless, Scotiabank and KPMG. Her roles covered general management consulting, end-to-end human resource (HR) management, corporate and commercial banking and corporate governance. Lisa is a visionary and a leader in her field. She is commercially driven and possesses a deep understanding of talent and of unlocking people's potential to deliver competitively advantaged business results.

She is trained in performance diagnostics and breakthrough performance coaching and has a strong and consistent ownership orientation. She has undertaken and held leadership roles in global transformational projects, is known for delivering compelling results, is insightful and ideates people solutions with ease. These efforts have resulted in high impact commercial and employee performance outcomes. Lisa is highly respected in the business community in Jamaica, has held key industry association roles and sat on company boards and pension plan trustee boards in the public, private and not for-profit sectors. She has a B.Sc. in Industrial Engineering (First Class Hons) and an MBA (Distinction) in Finance and Marketing from UWI, and has held the PHR and SPHR designation.

Lisa is also a member of the Company's Audit and Compensation Committees.


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Adam Stewart

Adam is the dynamic Deputy Chairman and Chief Executive Officer of Sandals Resorts International, one of the world’s leading resort companies, and The ATL Group, Jamaica’s longest standing automotive and appliance distributors with recently expanded region-wide operations. Adam also serves as the President of the Sandals Foundation, a 501 (c) (3) nonprofit organization aimed at fulfilling the promise of the Caribbean community by improving lives and preserving the natural surroundings, through investments in sustainable regional projects in education, community and the environment.

Born in 1981, Adam Stewart was raised in Jamaica and later graduated from Florida International University’s (FIU) acclaimed Hospitality Management Programme in Miami. After graduation, Stewart underwent a fast track immersion course through the company’s Caribbean wide resort.

A decade under Adam’s stewardship, Sandals continues to follow a trajectory of exhilarating growth, encompassing new resorts in new island destinations coupled with the introduction of industry-changing innovation and developments. In October 2015, Adam was named the Caribbean Hotel and Tourism Association’s Hotelier of the Year 2015.

In August 2009, Adam was appointed CEO and Deputy Chairman of the family-owned ATL Group comprising the Jamaica Observer and ATL Appliance Traders, a chain of domestic and commercial appliance outlets combining exclusive distributorship of some of the world’s top electronic brands and “unbeatable” customer service throughout Jamaica.

Also in 2009, Adam founded the Sandals Foundation with the aim of uniting the region under one common goal: to lift its people through education and protect its delicate ecosystem. The Sandals Foundation harnesses the resources, talents, partnerships and awareness behind the Sandals Resorts brand to tackle a myriad of issues affecting the Caribbean.

In 2016, Adam received the Order of Distinction (Commander Class) for outstanding contribution to tourism and the hotel industry. Additionally, he has also been appointed as a member Jamaica’s Economic Growth Council and of the Board of Directors of the Port Authority. He has been chosen to lead the Tourism Linkages Committee in the capacity of Chairman and also currently holds the post of First Vice-President for the Jamaica Hotel and Tourist Association.

In May 2017, Starbucks Coffee Company announced it has entered a licensing agreement with Caribbean Coffee Traders Limited, a joint venture between Stewart and Ian Dear, Chief Executive Officer of the Jamaica-based Margaritaville Caribbean Group.

Adam is also also a member of the Company's Audit & Risk and Compensation & Governance Committees.


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EXECUTIVE DIRECTORS

William Mahfood- Chairman

William Mahfood was appointed Chairman of the Board in 2014. He holds a BSc. in Industrial Engineering & Management Information System from North Eastern University.

He started his career with Wisynco Trading limited as Warehouse Supervisor back in 1988. He then moved to Wisynco Group Limited where he served as Co-Director, Managing Director and Director for Wisynco Group and Walisa Marketing Limited for 11 years simultaneously.

William has served on over 10 Boards during his career. This includes serving as President of the Private Sector Organization of Jamaica (PSOJ) and Trade Wind Citrus Limited.

Andrew Mahfood - Chief Executive Officer

Andrew Mahfood is currently the Chief Executive Officer of Wisynco Group Limited. He is a Chartered Accountant and member of the Chartered Professional Accountant (CPA) Association in Ontario, Canada. He obtained a BSc. in Finance, Economics and Computer Science from Boston College.

Andrew worked at Price Waterhouse North York, Ontario Canada for 3 years before moving to Wisynco Trading Limited as a Financial Controller in 1991. He then went on to become Group Finance Director for 6 years before becoming CEO.

Andrew serves on the following boards: Wisynco Group Limited, Wisynco Foods Limited, Food for the Poor Jamaica, Trade Winds Citrus Limited, United Estates Limited and Seville Development Corp.


61

François P. Chalifour - Director of Marketing & Product Development

Currently the Director of Marketing & Development of Wisynco Group Limited, Chalifour has a degree in Administrative and Commercial Studies from the University of Western Ontario and a degree in Accounting from University of Laval, Canada. He is a member of the Chartered Professional Accountant (CPA) Association of Quebec.

Francois began his career in Montreal Canada for 5 years in the early 1990s as an Auditor for Richter, Usher & Vineberg, and a Financial Controller at Bariatrix International. He moved to Jamaica to start-up The Jamaica Drink Company Ltd where he served as Managing Director for 8 years. As Jamaica Drink was amalgamated into The Wisynco Group Limited, Francois continued his role overseeing manufacturing of the Company’s beverage brands. In 2012, he took on the role of Director of Marketing and Development for the entire Group.

François Andrew serves on the following boards: Recycle Partners of Jamaica, Wisynco Group Limited, Wisynco Foods Limited, CGM Gallagher, United Estates Limited and Trade Winds Citrus Limited.

Devon H. Reynolds - Director of Manufacturing

Devon Hugh Reynolds has a diploma in Electrical and Electronic engineering from the College of Arts, Science & Technology and was trained or received certification in Supervisory Management, Injection Moulding, Production management, industrial Relations, Flexible packaging and Advance Executive Management development.

At Wisynco Group Limited Reynolds served as Maintenance Manager, Assistant Plant Manager, Plant Manager, General Manager, Managing Director and now Director of Manufacturing for the past 20 yrs.

Prior to working at Wisynco Group, Reynolds started his work experience as a Maintenance Engineer at Thermo-Plastics, Jamaica limited, where he became a supervisor. He went on to the Plastic Corporation of Jamaica as a Production Factory Foreman and was promoted to Plant manager. He returned to Thermo-Plastics as a Production manager.


62

Joseph M. Mahfood - Director Emeritus

Joseph Mahfood, Wisynco Group Director Emeritus, was educated at McGill University in Montreal, Canada.

Prior to becoming Store Manager of Mahfood’s 1965 Ltd, Joseph started his work experience as a travelling salesman for Mahfood’s Commercial Ltd. After which he started working at Wisynco where he was Plant Manager, General Manager and Group Managing Director.

Joseph serves on the following boards: Wisynco Group Limited and Seville Development Corp.

Andrew Fowles - Group Company Secretary

Andrew is a member of the Institutes of Chartered Accountants in both Scotland and Jamaica. He previously worked at Price Waterhouse as a Group Manager and at Jamaica Broilers as Project Co-ordinator, before joining West Indies Synthetics in 1987 as Financial Director. He left in 1995 to set up his own consulting practice, and now serves a wide range of corporate clients throughout Jamaica.

He was appointed Group Company Secretary in 2005. He also sits on the boards of Seville Development Corporation Limited and Xsomo International Limited.

EXECUTIVE MANAGEMENT COMMITTEE

Sean Scott - Strategy and Special Projects

Sean Scott currently heads Strategy and Special Projects as a member of Wisynco’s Executive Management Committee. Sean began his career as a management consultant for On The Frontier Group, a Boston-based strategy consulting firm. He later became a Regional Manager of J Wray and Nephew Ltd where he oversaw the Mexican market before returning to Jamaica in 2010 to join Wisynco. Since 2011 Sean has also overseen the operation of Wisynco Foods Ltd, a wholly owned subsidiary of Wisynco Group. Sean holds an MBA from the Harvard Business School and a B.A. in Political Science from Stanford University.


63

Gerald Mahfood - Head of Operations

Gerald Mahfood was appointed Head of Operations in 2001. He has a BA Degree in Business from Loyola University and an Associate Degree from Broward Community College.

He started as an Accountant Manager at Essex Exports in Florida where he spent 4 years. He then went on to become Managing Director at Wisynco Fisheries for 10 years.

He currently serves on the Board of Food for the Poor.

Halcott Holness - Head of Sales

Halcott Holness was appointed Head of Sales in 2007. He has experience in managing large distribution/sales division and implementing automated sales/distribution sytems.

Halcott was a Production Supervisor at Dairy Industries Limited. He was also an Assistant Sales Manager at Gator Ltd, business Manager at Walisa T&T Ltd., Sales & Marketing export Manager at Wisynco Group. He went on to become the National Sales Manager of the Wisynco Group.

He has a Master’s degree in Business Administration from Nova Southeastern University and a BSc. In Management studies from the University of the West Indies, Mona.

Christopher Ramdon- Chief Information officer

Christopher Ramdon currently serves as the Chief Information Officer at Wisynco Group Limited where he oversees all hardware and software, telecom infrastructure and systems infrastructure. He has a BSc. in Electronics and Physics from the University of the West Indies and also a Masters of Business Administration in Finance and Operations with emphasis in Brand Management from the Vanderbilt University’s Owen Graduate School of Management. His areas of expertise also include: Project Management and Business process Improvement, ERP implementation, Strategic planning and execution and IT security policy implementation.


64

Jacinth Bennett – Group Financial Controller

Jacinth became the Group Financial Controller of Wisynco Group Limited in August 2006. Jacinth is an ACCA certified accountant.

Jacinth started as an Input Clerk/Teller at NCB. She served as a Cost Accountant at Caribbean Casting Limited, Senior Accountant at PricewaterhouseCoopers, a Financial Controller at Partner Foods Limited and then at Sugar Company of Jamaica before becoming the current Financial controller at the Wisynco Group Limited.

She sits on the Boards of Wisynco Foods Limited and the Greendale Early Childhood Development Centre.

Caron Anderson - Head of HR Services and People Development

Caron was appointed Head of Human Resources & People Development in 2016. She previously held positions such as Human Resource Manager of Kraft Foods Jamaica, Group Human Resource Manager of CVM Group Limited. She also currently hold a position as a Human Resource Business Partner for LIME, a position she has held since 2010.

She has a Bachelor of Business Administration (BBA) from the University of North Florida in 2002 and a Master of Science in Human Resource Management (MSc. HRM) from Florida International University in 2005. She also obtained a Certificate in Counselling from the Mico University in 2011.

DIRECTORS’ AND MANAGERS’ INTEREST IN ORDINARY SHARES

No senior managers hold any Shares, save for the Directors’ interests in the Shares (including legal holdings) as at the date of this Prospectus which are set out below:

Name of Directors Number of Shares before Opening Date

John Lee NIL

Lisa Soares- Lewis NIL

Adam Stewart NIL

William Mahfood NIL***

Andrew Mahfood NIL***

Francois Chalifour 10,540

Devon H. Reynolds 10,540

Joseph Mahfood NIL***

*** These Directors have a beneficial holding in Wisynco Group (Caribbean) Limited which owns 93.93% of the Company.


65

CORPORATE GOVERNANCE AND ACCOUNTABILITY

The Board has constituted two (2) committees, namely the Audit & Risk Committee as required pursuant to the provisions of the Main Market Rules. An additional committee was also constituted which is the Compensation & Governance Committee although not strictly required by the Main Market Rules. The members of the Audit committee include a majority of independent non-executive Directors, as required by Appendix 3, Rule 14 of the Main Market Rules. The members of the respective committees are as follows:

Audit & Risk Committee Compensation & Governance

John Lee - Chairman Lisa Soares Lewis - Chairman

Lisa Soares Lewis John Lee

Adam Stewart Adam Stewart

DIRECTORS’ FEES AND EMOLUMENTS

Each Director shall receive fees in the amount that is to be approved by the Compensation Committee. This includes reimbursement of reasonable fees and expenses, attendance at each meeting of the Board of the Company and membership of sub-Committee (s).

For the year ended 30 June 2017, the total director’s compensation is as follows:

Position J$’000

Director’s Fee 18,000

Salary and Bonus 177,923

Contributions under the pension scheme including N.I.S. 9,064

Pension Benefits 7,418

66

10. AUDITOR’S REPORT

Independent Auditors’ Report

To the Board of Directors of Wisynco Group Limited

Report on Summarised Financial Statements The accompanying summarised financial statements titled “Audited Financial Information” have been derived from the financial statements of Wisynco Group Limited (the Company) as at, and for the financial year ends, referred to in the table below.

The accompanying summarised financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on whether the summarised financial statements are consistent, in all material respects, with the financial statements from which they were derived.

We have audited the following financial statements as at and for the financial year ends detailed in the table below, from which these summarised combined financial statements were derived. These audits were conducted in accordance with International Standards on Auditing. In our reports, dated as indicated in the table below, we expressed unqualified opinions on the financial statements from which the summarised financial statements were derived.

Year End Audit Report Date

3o June 2013 6 March 2014

3o June 2014 23 February 2015

3o June 2015 21 March 2016

3o June 2016 30 November 2016

3o June 2017 6 November 2017

PricewaterhouseCoopers, Scotiabank Centre, Duke Street, Box 372, Kingston, Jamaica T: (876) 922 6230, F: (876) 922 7581, www.pwc.com/jm

L. A. McKnight P.E. Williams A.K. Jain B.L. Scott, B.J. Danning G.A. Reece P.A. Williams R.S. Nathan C.I. Bell-Wisdom G.K. Moore

AUDITOR’S REPORT (Continued)

67

Emphasis of Matter

We draw your attention to the following:

The summarised combined financial statements are not a complete set of financial statements, with all the required disclosures of International Financial Reporting Standards. For a better understanding of the Company’s financial position and the results of operations for the periods presented, and of the scope of the related audits, the summarised financial statements should be read in conjunction with the financial statements from which the summarised financial statements were derived and our audit reports thereon.

We have not qualified our opinion in relation to the above matter.

Opinion

In our opinion, the accompanying summarised financial statements are consistent, in all material respects, with the financial statements from which they were derived.

Chartered Accountants

14 November 2017 Kingston, Jamaica

Page 2 of 2


68

Wisynco Group Limited Summary Separate Financial Statements 30 June 2017


69

Page 69

Wisynco Group Limited Summary Statement of Comprehensive Income For each of the Five Years ended 30 June 2013, 2014, 2015, 2016 and 2017 (expressed in Jamaican dollars unless otherwise indicated)

2013

$’000 2014 $’000

2015 $’000

2016 $’000

2017 $’000

Revenue 12,573,537 14,229,683 17,150,482 19,413,691 21,247,767

Cost of sales (8,225,039) (9,384,206) (10,945,181) (11,676,741) (13,319,888)

Gross Profit 4,348,498 4,845,477 6,205,301 7,736,950 7,927,879

Impairment of inventory and property, plant and equipment - - - (1,317,390) -

Other operating income 96,515 62,609 57,408 1,530,045 736,796

Selling and distribution expenses (2,772,173) (3,152,132) (3,489,090) (4,151,836) (5,244,802)

Administration expenses (553,542) (651,369) (807,662) (774,564) (885,903)

Operating Profit 1,119,298 1,104,585 1,965,957 3,023,205 2,533,970

Finance income 86,207 32,936 68,334 124,347 159,965

Finance costs (107,517) (135,105) (176,717) (146,768) (169,746)

Profit before Taxation 1,097,988 1,002,416 1,857,574 3,000,784 2,524,189

Taxation (296,328) (153,518) (380,551) (702,083) (286,312)

Net Profit 801,660 848,898 1,477,023 2,298,701 2,237,877

Other Comprehensive Income

Items that may be subsequently reclassified to profit or loss

Unrealised (loss)/gain on available-for-sale investments (2,150) (1,413) 4,790 9,118 (4,344)

Total Comprehensive Income 799,510 847,485 1,481,813 2,307,819 2,233,533

Earnings Per Share -- --------- - $2,158.40 $2,101.29


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Page 2

Wisynco Group Limited Summary Statement of Financial Position Five Years Ended 30 June 2013, 2014, 2015, 2016 and 2017 (expressed in Jamaican dollars unless otherwise indicated)

2013$’000

2014$’000

2015$’000

2016 $’000

2017$’000

Non-Current Assets

Property, plant and equipment 2,614,102 2,579,066 2,866,621 3,147,581 4,874,521

Investments in subsidiaries 157,934 157,934 157,934 164,434 164,434

Investments in associates - 429,498 429,498 429,498 429,498

Intangible assets 25,606 11,639 - - -

Available-for-sale investments 14,630 13,217 23,266 229,426 293,452

Loans to related parties 18,633 - - - -

2,830,905 3,191,354 3,477,319 3,970,939 5,761,905

Current Assets

Inventories 1,624,285 1,765,222 1,427,837 1,577,331 1,940,382

Loans to related parties 1,509 - - - -

Receivables and prepayments 1,377,828 1,672,403 1,683,770 2,454,993 1,978,610

Available-for-sale investments – current portion - -

-

-

184,386

Cash and short-term deposits 1,188,193 1,473,120 2,489,778 3,740,479 3,187,431

4,191,815 4,910,745 5,601,385 7,772,803 7,290,809

Current Liabilities

Trade and other payables 1,979,734 1,898,473 2,153,505 3,363,517 3,093,489

Short-term borrowings 333,165 479,609 512,103 341,012 382,469

Taxation payable 113,645 215,007 307,897 532,623 178,814

Due to parent company - - - - 259,745

2,426,544 2,593,089 2,973,505 4,237,152 3,914,517

Net Current Assets 1,765,271 2,317,656 2,627,880 3,535,651 3,376,292

4,596,176 5,509,010 6,105,199 7,506,590 9,138,197

Shareholders’ Equity Share capital 57,927 57,927 57,927 57,927 57,927

Capital reserve 108,946 107,533 112,323 121,441 117,097

Retained earnings 2,952,616 3,635,827 4,546,353 5,942,963 6,976,619

3,119,489 3,801,287 4,716,603 6,122,331 7,151,643

Non-Current Liabilities

Due to parent company 259,745 259,745 259,745 259,745 -

Deferred tax liabilities 403,052 285,409 240,103 252,465 213,565

Borrowings 813,890 1,162,569 888,748 872,049 1,772,989

1,476,687 1,707,723 1,388,596 1,384,259 1,986,554

4,596,176 5,509,010 6,105,199 7,506,590 9,138,197


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Page 3

Wisynco Group Limited Summary Statement of Changes in Equity For each of the Five Years ended 30 June 2013, 2014, 2015, 2016 and 2017 (expressed in Jamaican dollars unless otherwise indicated)

Number of

Shares

ShareCapital

$’000

Capital Reserves

$’000

RetainedEarnings

$’000 Total $’000

Balance at 30 June 2012 1,053,986 16,027 111,096 2,353,161 2,480,284

Total comprehensive income - - (2,150) 801,660 799,510

Transactions with owners -

Issue of shares 10,646 41,900 - - 41,900

Dividends paid - - - (202,205) (202,205)

Balance at 30 June 2013 1,064,632 57,927 108,946 2,952,616 3,119,489

Total comprehensive income - - (1,413) 848,898 847,485


Dividends paid - - - (165,687) (165,687)

Balance at 30 June 2014 1,064,632 57,927 107,533 3,635,827 3,801,287

Total comprehensive income - - 4,790 1,477,023 1,481,813


Dividends paid - - - (566,497) (566,497)

Balance at 30 June 2015 1,064,632 57,927 112,323 4,546,353 4,716,603



Dividends paid - - - (902,091) (902,091)

Balance at 30 June 2016 1,064,632 57,927 121,441 5,942,963 6,122,331

Total comprehensive income - - (4,344) 2,237,877 2,233,533


Dividends paid - - - (1,204,221) (1,204,221)

Balance at 30 June 2017 1,064,632 57,927 117,097 6,976,619 7,151,643


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Page 4

Wisynco Group Limited Summary Statement of Cash Flows For each of the Five Years ended 30 June 2013, 2014, 2015, 2016 and 2017 (expressed in Jamaican dollars unless otherwise indicated)

2013$’000

2014$’000

2015$’000

2016$’000

2017$’000

Net profit from operations 801,660 848,898 1,477,023 2,298,701 2,237,877

Items not affecting cash:

Depreciation 230,619 328,780 376,112 451,889 536,807

Amortisation of intangible assets 16,294 13,967 11,639 - -

Gain on fire claim - - - (1,434,896) (636,472)

Adjustment - 2 (39) - -

Gain on sale of property, plant and equipment

(178) (150) 2,391 6,232 (1,524)

Impairment of inventory and property, plant and equipment in fire

- - - 1,317,390 -

Interest income (30,260) (30,263) (38,811) (53,966) (71,736)

Gain on disposal of investments - - - - (10,805)

Dividend income (541) (697) (1,728) (1,734) (3,101)

Interest expense 105,974 133,053 172,604 142,399 158,678

Taxation expense 296,328 153,518 380,551 702,083 286,312

Exchange gain on foreign currency balances

6,891 (7,185) (36,950) (140,301) (25,819)

1,426,787 1,439,923 2,342,792 3,287,797 2,470,217

Changes in operating assets and liabilities:

Inventories (328,799) (140,937) 337,385 (1,288,380) (363,051)

Receivables and prepayments (169,008) (265,721) (68) (269,013) 480,375

Trade and other payables 249,120 (189,892) 220,202 1,116,228 (298,176)

Cash generated from operations 1,178,100 843,373 2,900,311 2,846,632 2,289,365

Insurance proceeds - - - 655,350 156,623

Taxation paid (254,025) (169,799) (332,967) (464,995) (679,021)

Cash provided by operating activities 924,075 673,574 2,567,344 3,036,987 1,766,967


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Page 5

Wisynco Group Limited Summary Statement of Cash Flows (Continued) For each of the Five Years ended 30 June 2013, 2014, 2015, 2016 and 2017 (expressed in Jamaican dollars unless otherwise indicated)

2013$’000

2014$’000

2015$’000

2016$’000

2017$’000

Operating Activities

Cash provided by operating activities 924,075 673,574 2,567,344 3,036,987 1,766,967

Cash Flows from Investing Activities

Purchase of property, plant and equipment (801,019) (235,798) (620,634) (859,862) (2,258,648) Proceeds from the sale of property, plant and equipment

303 150 - 1,500 25,199

Insurance proceeds - - - 296,010 479,849

Purchase of investments - - (5,259) (197,042) (260,295)

Proceeds from sale of investments - - - - 18,344

Investment in associates - (429,498) - - -

Investment in subsidiary (3,981) - - (6,500) -

Dividend received 541 697 1,728 1,734 3,101

Interest received 30,260 30,263 38,811 53,966 71,736

Cash used in investing activities (773,896) (634,186) (585,354) (710,194) (1,920,714)

Cash Flows from Financing Activities

Interest paid (95,680) (130,685) (174,501) (157,473) (158,678)

Related party loan payment received 16,981 20,142 - - -

Long-term loans repaid (241,790) (257,393) (405,753) (1,246,631) (928,278)

Long-term loans received 360,000 689,000 200,000 1,000,000 1,900,000

Finance leases repaid - (13,193) (26,739) (41,107) (49,041)

Dividend paid (202,205) (165,687) (566,497) (902,091) (1,204,221)

Cash used in financing activities (162,694) 142,184 (973,490) (1,347,302) (440,218)

(Decrease)/Increase in cash and cash equivalents

(12,515) 181,572 1,008,500 979,491 (593,965)

Effects of changes in foreign exchange rates 107,865 86,962 60,481 215,411 49,975

Increase in cash and cash equivalents 95,350 268,534 1,068,981 1,194,902 (543,990)

Cash and cash equivalents at beginning of year 1,031,668 1,127,018 1,395,552 2,464,533 3,659,435

Cash and Cash Equivalents at End of Year 1,127,018 1,395,552 2,464,533 3,659,435 3,115,445

The principal non-cash transactions include: Acquisition of property, plant & equipment under finance lease - 57,948 45,385 59,223 28,774


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Page 6

Wisynco Group Limited Additional Disclosures (expressed in Jamaican dollars unless otherwise indicated)

Additional Disclosures

These are the summary financial statements of Wisynco Group Limited (‘the Company”) for the five years ended 30 June 2013, 2014, 2015, 2016 and 2017. The summary financial statements are derived from the full financial statements of the Company as at and for the years ended 30 June 2013, 2014, 2015, 2016 and 2017.

The Company is incorporated and domiciled in Jamaica. The parent company is Wisynco Group (Caribbean) Limited, a Barbados International Business Company. The ultimate controlling party of the company is Evesam Investments Holdings Limited, a company incorporated in the Cayman Islands. The registered office of the company is located at White Marl, St Catherine.

The principal activities of the company are the bottling and distribution of water and beverages, the manufacturing of a wide range of plastic and foam packaging and disposable products for use in industry, tourism and for the retail trade, the distribution and retailing of food items.

Effective 1 January 2014 Wisynco Group Limited purchased 50% of the shareholdings in Fusion Holdings Limited a company incorporated and resident in St. Lucia.

Basis of preparation

The summary financial statements have been extracted from the financial statements, and prepared in accordance with the Jamaican Companies Act. The financial statements as at and for the years ended 30 June 2013, 2014, 2015, 2016 and 2017 were authorised for issue by the Board of Directors on 6 March 2014, 23 February 2015, 21 March 2016, 30 November 2016 and 6 November 2017, respectively.

These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs), and contain unmodified audit opinions.

The summary financial statements do not include all the disclosures provided in the financial statements and cannot be expected to provide as complete an understanding as provided by the financial statements. The full financial statements are available at the offices of Wisynco Group Limited, Lakes Pen, St. Catherine. The full financial statements have been reviewed by PricewaterhouseCoopers Jamaica who, in their reports expressed an unqualified opinion for each year.

75

11. MANAGEMENT’S DISCUSSION & ANALYSIS AND FINANCIAL HIGHLIGHTS

The following Management’s Discussion and Analysis (MD&A) and Financial Highlights section should help potential investors understand the results of the financial condition of the Company. This section should be read in conjunction with the Audited Financial Statements and respective notes in Section 13. This MD&A and financial highlights section reflects the financial results of the Company on a standalone basis. Refer to the Pro–Forma Adjustments in Section 12 below for the impact of the reconstruction mentioned in Section 8.

RECENT INVESTMENT HIGHLIGHTS

The Company has made recent investments of approximately US$12 million to build a new warehouse located at its Lakes Pen property and plans to invest another US$8 million to increase its beverage manufacturing capacities. The rebuilding was partly financed by insurance proceeds received as a result of the fire that occurred in May 2016 as well as debt financing.

The Company is also in the process of rebuilding its cold storage facility which was damaged in the May 2016 fire.

ANNUAL FINANCIAL PERFORMANCE HIGHLIGHTS

Overall, Wisynco Group Limited has performed creditably in recent years, with the following key highlights:

Sales increasing from J$12.57 billion in 2013 to J$21.25 billion in 2017 which represents a Compound Annual Growth Rate (“CAGR”) of 14.0%. During the five-year period, the year-to-year sales growth ranged from 9.5% to 20.5%. The growth between 2016 and 2017 was 9.5%;

Relatively strong gross profit margins, with annual average of approximately 36.4% over the last five years. The gross profit margin moved from 39.9% in 2016 to 37.3% in 2017;

Operating Expenses as a percentage of sales has an annual average of approximately accumulated 25.6% over the last five years. This metric slightly increased from 24.4% in 2016 to 25.4% in 2017;

High utilization of assets and equity when compared to other manufacturing and distribution companies in Jamaica with return on assets and return on equity for financial year 2017 being 17.1% and 31.3%, respectively;

Efficient working capital management with net working capital totalling J$3.38 billion in FY 2017, a marginal decrease from J$3.72 billion in FY 2016;

Low debt to equity ratio relative to other manufacturing and distribution companies in Jamaica, ranging from 14.2% to 30.6% over the last five years; and

Proven ability to absorb shocks (e.g. May 2016 fire) and while maintaining a strong financial performance. We note that there was a marginal 2.6% decline in Net Profit after Tax moving from J$2.30 billion in FY 2016 to J$2.24 billion in FY 2017.

Impact of fire

During FY 2016 the Company had a fire incident which resulted in impairment losses in Fixed Assets and Inventory in the amount of J$1.32 billion.

The related insurance proceeds represent funds received for business interruption, loss of warehouse building, solar panels and inventory totaling J$2.07 billion of which J$0.64 billion was received in FY17 and the remaining J$1.43 billion was received in FY16. In addition to the loss of property, the Company also incurred one-off expenses such as property rental, haulage and handling costs. There were also other increases related to electricity and hiring of approximately 200 additional staff due to operational changes affecting all areas of production.

The full impact of the fire on the Company’s operations would have been evident in FY 2017, which shows a slight reduction in performance compared to FY 2016. The Company expects that its operating metrics will return to pre-fire levels in the near future.

MANAGEMENT’S DISCUSSION & ANALYSIS AND FINANCIAL HIGHLIGHTS (Continued)

76

HISTORICAL STATEMENT OF COMPREHENSIVE INCOME

For Period ended June 30

J$’000 FY 2013

(Audited)

FY 2014

(Audited)

FY 2015

(Audited)

FY 2016

(Audited)

FY 2017

(Audited)

Sales 12,573,537 14,229,683 17,150,482 19,413,691 21,247,767

Gross Profit 4,348,498 4,845,477 6,205,301 7,736,950 7,927,879

Operating Expenses

3,250,510 3,843,061 4,347,727 4,736,166 5,403,690

EBITDA 1,476,916 1,499,674 2,417,929 3,595,072 3,230,742

Pre-tax Profit 1,097,988 1,002,416 1,857,574 3,000,784 2,524,189

Tax Expense 296,328 153,518 380,551 702,083 286,312

Net Profit 801,660 848,898 1,477,023 2,298,701 2,237,877

Actual Earnings per Share*

752.99 797.36 1,387.36 2,158.40 2,101.29

Pro-forma Earnings per Share**

0.21 0.23 0.39 0.61 0.60

Gross Profit Margin

34.6% 34.1% 36.2% 39.9% 37.3%

EBITDA Margin 11.7% 10.5% 14.1% 18.5% 15.2%

Net Profit Margin

6.4% 6.0% 8.6% 11.8% 10.5%

* - Based on historical shares outstanding of 1,064,632, prior to this Prospectus; Audited EPS only calculated in FY 2016-2017, management calculated previous year’s EPS.

** - Based on pro-forma shares outstanding of 3,750,000,000 as at the date of this Prospectus; Pro-forma EPS figures unaudited.


77

SALES

The Company experienced a steady growth in sales over the last five financial periods from 2013-2017. In the financial year ended 30 June 2017, the Company had total sales of J$21.25 billion, a 9.5% growth over the prior period ending 30 June 2016. In the five years mentioned, revenue grew by a CAGR of 14.0%. The growth in sales is mainly driven by:

Increases in sales volumes for owned brand products (see Section 7), in particular Boom energy drink and WATA;

Distribution of local third party products, in particular products manufactured by Trade Winds Citrus Company. The Company commenced the distribution of these products in FY 2015;

Investments in additional production capacity as well continued refinement and deepening of distribution and demand generating strategies; and

General price increases of most product prices driven by country local inflationary conditions.

Sales growth in FY 2017 was tempered mainly as a result of the effects of the May 2016 fire, which negatively impacted the efficiency with which goods were distributed to customers.

10.0%

13.2%

20.5%

13.2%

9.5%

-

5,000,000

10,000,000

15,000,000

20,000,000

25,000,000

0%

5%

10%

15%

20%

25%

2013 Audited 2014 Audited 2015 Audited 2016 Audited 2017 Audited

JMD

'000

%

Period

Sales

Total Sales Sales Growth

98.6%

1.4%

Local vs Export Sales

Local Sales Export Sales


78

The main drivers of the Company’s sales are local demand. This includes wholesalers, hotels and restaurants, schools, supermarkets and other retailers.

The main sale product categories (See Section 7 for further information) are:

Manufactured – Owned – accounted for 45.9% of sales. This is the Company’s owned manufactured products such as WATA, BOOM, BIGGA, SWEET disposable products and packaging products.

Distributed – Imported Third Party – accounted for 22.6% of sales. This is the portfolio of products arising from Company’s distribution agreements with foreign brands such as Red Bull, Kellogg’s General Mills and Nestle

Manufactured – Third Party – accounted for 16.9% of sales. This includes branded products that the Company manufactures through agreements with third parties such as Coca-Cola, Hawaiian Punch and SqueezZ.

Distributed – Local Third Party – accounted for 13.2% of sales. This is the portfolio of products arising Company’s distribution agreement with local entities. Main brands include.Tru-Juice and Freshhh

Export – accounted for 1.4% of sales.

45.9%

16.9%

13.2%

22.6%

1.4%

Revenue by Product Categories - FY Ending June 2017

Manufactured - Owned Manufactured - Third Party

Distributed - Local Third-Party Distributed - Imported Third-Party

Export


79

GROSS MARGIN

The Company also experienced an improvement in gross profit margin over the last five financial periods from 2013 to 2017. This was primarily as a result of:

A combination of price increases, lower input costs arising from the reduction of raw material costs for sugar and oil and as well as improved manufacturing efficiency as a result of increased volumes.

The product mix: where higher gross margin products, such as the Company’s manufactured - Owned brands experiencing higher growth relative to the other product categories.

Even though gross profit increased by just under J$190.93 million in 2017, the gross profit margin reduced from 39.9% in 2016 to 37.3% in 2017. This was due mainly to abnormal levels of inventory adjustments and damages due to inherent risks associated with multiple temporary locations and increased handling of products. The inventory lost during the fire was recovered from insurance proceeds. In addition, in FY2017 the Company adopted a “full service model” with greater client focus, resulting in each customer being visited at least twice per week.

34.6%

34.1%

36.2%

39.9%

37.3%

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000

9,000,000

33%

34%

35%

36%

37%

38%

39%

40%

41%


JMD

'000

%

Period

Gross Margin

Gross Margin Gross Margin Perentage


80

OPERATING EXPENSES

Total operating expenses (excluding cost of sales) in financial year 2017 amounted to J$5.40 billion, a 14.1% increase over the prior period. All major expense categories increased during FY 2017, including the following:

Staff Costs grew by 13.4% from J$2.84 billion in FY 2016 to J$3.22 billion in FY 2017. This increase is mainly due to transitional costs related to the fire such as incremental labour and other costs related to logistics management;

Property Expenses including Depreciation grew by 13.3% from J$1.20 billion in FY 2016 to J$1.35 billion in FY 2017;

Delivery Expenses grew by 41.1% from J$0.83 billion in FY 2016 to J$1.16 billion in FY 2017; and Advertising Costs grew by 13.9% from J$.75 billion in FY 2016 to J$0.86 billion in FY 2017.

Delivery expenses increased mainly due to additional distribution channels and increased travel between newly-leased properties and warehouses post-May 2016 fire. This investment in delivery channels was required in order for the Company to resume distribution of its products after the fire.

In the five years mentioned, total expenses (excluding cost of sales) grew by a CAGR of 13.5%. In addition, operating expenses as a % of sales historically range between 24.4% and 27.0%.

55.6%

16.5%

7.0%

6.0%

4.4%

10.5%

Expenses by Nature - FY Ending June 2017

Cost of SalesStaff costsProperty ExpensesDelivery and Motor Vehicle ExpensesAdvertising CostsOther Operating Expenses

25.9%

27.0%

25.4%

24.4%

25.4%

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

23%

24%

24%

25%

25%

26%

26%

27%

27%

28%


JMD

'000

%

Period

Expenses

Expenses Expenses as a % of Sales


81

EARNINGS BEFORE INTEREST, TAX, DEPRECIATION AND AMORTIZATION (EBITDA)

The Company experienced steady growth of EBITDA between FY2014 and FY2016, before the impact of the fire. EBITDA margin has declined from 18.5% in FY 2016 to 15.2% in FY 2017. This decline is again due to the May 2016 fire which created downward pressure on sales growth and led to higher than normal expenses. Despite the impact of the fire, the Company still experienced a CAGR of 21.6% of EBITDA between FY 2013 and FY 2017.

NET PROFIT

The effects of the fire in May 2016 resulted in a marginal decline of net profits of 2.7% from J$2.30 billion in FY 2016 to J$2.24 billion in FY 2017. Prior to that the Company experienced a steady increase in profits year-on-year which was primarily driven by the consistent increases in the gross margins, an annual average double digit growth in revenue and control of operating expenses.

11.7%10.5%

14.1%

18.5%

15.2%

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

0%

5%

10%

15%

20%

25%


JMD

%

Period

EBITDA

EBITDA EBITDA Margin

6.4% 6.0%

8.6%

11.8%10.5%

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

20%


JMD

%

Period

Net Profit

Net Profit after Tax Net Profit Margin


82

RETURN ON ASSETS AND RETURN ON EQUITY

Both the Return on Assets (ROA) and Return on Equity (ROE) followed the same pattern year-on-year of moderate growth where the net profit grew at a much higher rate as compared to both the total assets and retained earnings. This shows the Company’s high efficiency and usage of its assets and equity to generate revenue/profits. However, due to the decline in net profit in 2017, the ROA moved from 19.6% to 17.1%, while the ROE moved from 37.5% to 31.3%.

RELATED PARTY TRANSACTIONS

The Company has a number of related parties that it buys from and sells to. This includes sales to Wisynco Foods Limited and purchases from Trade Winds Citrus Limited. See description of services below:

Wisynco Food Limited – the supply of beverages and Wata and Sweet products to WFL’s restaurants, Wendy’s and Dominos.

Trade Winds - distributes chilled products, oranges and other juices made by Trade Winds, which includes Tru-Juice and Freshhh branded products. The Company also manufactures and distributes the SquezzZ branded products under licence.

Historical Sales to Related Parties accounted for only approximately of 2.8% of total sales annually.

11.4% 10.5%

16.3%

19.6% 17.1%

25.7%

22.3%

31.3%

37.5%

31.3%

0%

5%

10%

15%

20%

25%

30%

35%

40%


%

Period

Return on Assets and Equity

Return on Assets Return on Equity


83

HISTORICAL STATEMENT OF FINANCIAL POSITION

As at June 30

J$’000 FY 2013

(Audited)

FY 2014

(Audited)

FY 2015

(Audited)

FY 2016

(Audited)

FY 2017

(Audited)

Non-current Assets

2,830,905 3,191,354 3,477,319 3,788,665 5,761,905

Current Assets 4,191,815 4,910,745 5,601,385 7,955,077 7,290,809

Total Assets 7,022,720 8,102,099 9,078,704 11,743,742 13,052,714

Current Liabilities

2,426,544 2,593,089 2,973,505 4,237,152 3,914,517

Non-current Liabilities

1,476,687 1,707,723 1,388,596 1,384,259 1,986,554

Total Liabilities 3,903,231 4,300,812 4,362,101 5,621,411 5,901,071

Net Assets 3,119,489 3,801,287 4,716,603 6,122,331 7,151,643

TOTAL ASSETS

As at 30 June 2017, the Company’s total assets was approximately J$13.05 billion and comprised mainly of:

Property, Plant and Equipment – 37.3%;

Cash – 24.4%;

Receivables – 15.2%; and

Inventory – 14.9%.

37.3%

4.6% 2.2%

14.9% 1.4%

15.2%

24.4%

Total Assets Breakdown as at 30 June 2017

Fixed assets Investment in Subsidiary/Associate

Available for Sale investments Inventories

Available for Sale investments Receiveables & Prepayments

Cash


84

NON-CURRENT ASSETS

Non-Current Assets comprise mainly Property Plant and Equipment, Investment in Subsidiaries and Associates and Available for Sale Investments. The growth in non-current assets throughout the period was mainly as a result of the recent investment in a new distribution centre and solar plant.

Property, Plant and Equipment includes lands and building which are carried at deemed/historical costs. The last valuation of the Company’s real estate was done in 1993.

Investment in Associates and Subsidiaries include amounts of J$583 million as at 30 June 2017 which relate to the carrying value of the non-core businesses which were transferred as part of the reconstruction. The impact of this transaction on the Company’s financials are shown in Section 12 – Pro-Forma Adjustments.

Available-for-sale investments primarily relates to quoted securities and bonds.

NET CURRENT ASSETS

The Company’s net current assets, which is current assets less current liabilities, grew every year up to FY 2017, with a CAGR of 17.6% between FY2013-FY2017. With the growth in working capital during that timeframe, the current ratio remained relatively flat between FY2014-FY2016, showing Company’s ability to manage its liquidity levels, raising short-term assets while managing short-term debt obligations. However, there was a slight reduction in net current assets and current ratio in FY 2017, due mainly to a 19.4% reduction in receivables and 18.8% reduction in cash. There was also an 8.0% decrease in Trade and Other Payables between FY 2016 and FY 2017.

NON-CURRENT LIABILITIES

Non-Current Liabilities include Borrowings, Deferred Tax and Due to Related Parties. Borrowings include Loans from banks and Finance Leases:

Loans from Banks increased by 92.5% during 2017 moving from J$1.05 billion at the end of FY 2016 to J$2.02 billion at the end of FY 2017. The Company’s primary lender is the National Commercial Bank (“NCB”). The loans from NCB mature between 2018 and 2023 and were obtained for the purpose of funding the expansion of the warehouse and the purchase of machinery and equipment.

1.73

1.89 1.88 1.88 1.86

-

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

1.00

1.20

1.40

1.60

1.80

2.00

2.20

2.40

2.60

2.80

3.00


JMD

'000

Am

ou

nt

Period

Net Current Assets

Net Current Assets Current Ratio


85

Finance Leases are primarily with MF&G Trust and has declined from J$81.52 million in in FY 2016 to J$61.25 million in FY 2017.

The Due to Related Parties’ balance was reclassified to Current Liabilities in FY 2017 and is expected to be repaid within the next 12 months. Further details on this balance is outlined in Section 8 – Pre-IPO settlement of related-party debt.

TOTAL EQUITY

Wisynco’s Shareholder’s Equity mainly consists of Share Capital, Capital Reserve and Retained Earnings. Shareholder’s Equity has increased by a CAGR of 23.0% over the last five years ending 30 June 2017. This increase is driven by Retained Earnings. Retained Earnings have increased primarily as a result of sustained profitability levels net of dividend payments. Over the last financial year from FY 2016 to FY 2017 the Retained Earnings balance has increased by J$1.03 billion or 17.4%.

-

1,000,000

2,000,000

3,000,000

4,000,000

5,000,000

6,000,000

7,000,000

8,000,000


JMD

'000

Period

Shareholder's Equity


86

Over the last five years, the Company declared dividends aggregating J$3.04 billion with the dividend pay-out ratio ranging from 19.5% to 53.8%.

DEBT TO EQUITY

The Company historically has a low debt to equity ratio. This illustrates that the Company has historically used more equity, in particular the Company’s accumulated earnings, to finance its growth. We define debt to equity as Loans over Total Shareholder’s Equity. Loans from respective banks dictate the change of the ratio, where increases/decreases in borrowings lead to increases/decreases in the ratio.

26.1%

30.6%

18.8%

14.2%

24.8%

0%

5%

10%

15%

20%

25%

30%

35%


%

Period

Debt to Equity


87

UNAUDITED FINANCIAL STATEMENTS AS AT 30 SEPTEMBER 2017

Statement of Comprehensive Income

Wisynco Group Limited Unaudited Pro-forma Statement of Comprehensive Income Period Ended 30 September 2017

J$'000 Q1 2018 Management

Total Sales 6,125,810

Cost of Sales 3,766,127

Gross Margin 2,359,683

Expenses 1,566,342

Net Profit 793,342

Taxation 137,540

Net Profit after Tax 655,802


88

Statement of Financial Position

Wisynco Group Limited Unaudited Statement of Financial Position Period Ended 30 September 2017

J$'000 Q1 2018

Management

Non-Current Assets

Fixed assets 4,892,883

Investment in Subsidiary/Associate 593,932

Available for Sale Investments 38,401

5,525,216

Current Assets

Inventories 1,850,898

Receivables & Prepayments 2,193,918

Cash 3,745,420

7,790,236

Current Liabilities

Trade & Other Payables 2,668,166

Short-term Borrowings 383,954

Due to Parent Company 262,505

Taxation Payable 451,941

3,766,566

Net Current Assets 4,023,670

9,548,886

Financed by Shareholders' Equity

Share Capital 57,927

Capital Reserve 97,738

Fair value Reserve 22,384

Retained Earnings 7,428,210

7,606,260

Long term Liabilities Deferred tax 252,460

Loans 1,690,166

1,942,626

9,548,886


89

INTERIM FINANCIAL PERFORMANCE

INTERIM STATEMENT OF COMPREHENSIVE INCOME

For the three month period ending 30 September

J$’000 Q1 Sept 2016

Unaudited

Q1 Sept 2017

Unaudited

% Change between Q1 Sept 2016 and Q1

Sept 2017

Sales 5,260,880 6,125,810 16.4%

Gross Profit 2,029,582 2,359,683 16.3%

Operating Expenses 1,314,984 1,566,352 19.1%

EBITDA 866,571 1,016,497 17.3%

Pre-tax Profit 714,833 793,342 11.0%

Tax Expense 123,784 137,540 11.1%

Net Profit 591,049 655,802 11.0%

Actual Earnings per Share* 555.17 615.99 11.0%

Pro-forma Earnings per Share** 0.16 0.17 11.0%

Gross Margin 38.6% 38.5% -

EBITDA Margin 16.5% 16.6% -

Profit Margin 11.2% 10.7% -

* - Based on historical shares outstanding of 1,064,632, prior to the prospectus

** - Based on pro-forma shares outstanding of 3,750,000,000 as at the date of the Prospectus

Quarter 1 2018 (period ending 30 September 2017) saw improvements in all major financial categories when compared to Quarter 1 2017 (period ending 30 September 2016). See key statistics below:

Sales and net profit increased by 16.4% and 11.0% respectively, showing recovery from the impact of the fire in May 2016;

Gross profit and EBITDA margins remained consistent between the two quarters. Gross profit margin moved from 38.6% in Q1 September 2016 to 38.5% in Q1 September 2017, while EBITDA margin moved from 16.5% in Q1 September 2016 to 16.6% in Q1 September 2017; and

Net profit margin moved from 11.2% in Q1 September 2016 to 10.7% in Q1 September 2017;

Even though there are slight declines in gross and profit margins in Q1 September 2017 when compared to Q1 September 2016, note that the Company did not move back into its central warehouse that was impacted by the fire until the end of July 2017, which is only 1 month into the new financial year. The Company is still in the process of regaining efficiencies. In fact, the performance in Q1 represented an overall improvement in operating margins over the last 9 months. The Company expects that its operating metrics will return to pre-fire levels in the near future and has created a special committee to monitor expenses.


90

INTERIM STATEMENT OF FINANCIAL POSITION

As at 30 September

J$’000 Q1 Sept 2016

Unaudited

Q1 Sept 2017

Unaudited

% Change

Non-current Assets 4,068,151 5,525,216 35.8%

Current Assets 7,017,320 7,790,236 11.0%

Total Assets 11,085,470 13,315,452 20.1%

Current Liabilities 2,612,821 3,766,566 44.2%

Non-current Liabilities 1,663,821 1,942,626 16.8%

Total Liabilities 4,276,643 5,709,192 33.5%

Net Assets 6,808,828 7,606,260 11.7%

Total Assets and Net Assets (Total Assets less Total Liabilities) have improved by 20.1% and 11.7% respectively when compared to Q1 2016. The biggest change in the balance sheet comes from a 50.5% increase in Property, Plant and Equipment, mainly due to purchases of machinery and equipment during that timeframe. Inventories have also improved by 38.8% compared to Quarter 1 2017 mainly due to an increased production capacity.

The Company has increased its long-term borrowings by 91.1% due to new financing received to fund the expansion of the warehouse and purchase of machinery and equipment.

OUTLOOK

The proceeds from the increase in the Company’s share capital of approximately J$1.1 billion after proportionally adjusting for respective share of IPO expenses will be utilised to increase its financial performance through:

Investments in manufacturing capacity to row both local and export markets for its current products and improve operating efficiencies.

Increase in working capital to fund expansion of distribution arrangements with additional key and important third party brands not currently served by the Company.

More targeted investments energy diversification, in particular liquefied natural gas (LNG) and solar, within the foreseeable future.

Aggressively targeting strategic acquisitions and partnerships.

INDIES INSURANCE COMPANY LIMITED

The principal activity of this company is to provide insurance services to its parent and other group affiliates. Indies has no employees and the principal place of business is in St. Lucia. The operations were dormant in FY2015 and FY2016. As per management report for financial year ending 30 June 2017, Indies has Net Profit of J$17.29 million, which is 0.8% of the Company's Net Profit of J$2.24 billion for period ending 30 June 2017. In addition, Indies has Net Assets of J$26.61 million, which is 0.4% of the Company's Net Assets of J$7.15 billion. Indies anticipate no major change in the short to medium term to its current business model.

Given its immateriality, the information shown in Section 10, Auditor’s Report, excludes the financial information for Indies. However, same is carried in the Balance Sheet of the Company as Investment in Subsidiaries at a value of J$11.375 million.

91

12. PRO-FORMA ADJUSTMENTS

The following unaudited pro-forma financial statements are based on the Company’s historical financial statements as adjusted to give effect to the pro-forma adjustments as at the date of the Prospectus, as illustrated below. These pro-forma adjustments primarily relate to:

The group reconstruction exercise as outlined in Section 8

The proposed pre-IPO dividend as outlined in Section 8

The proposed settlement of related party debt as outlined in Section 8

The pro-forma financial statements do not necessarily reflect what the Company’s financial condition or results of comprehensive income would have been had the adjustments occurred on the dates indicated. They also may not be useful in predicting the future financial condition and results of comprehensive income of the Company. The actual financial position and results of operations may differ significantly from the pro-forma amounts reflected herein due to a variety of factors.

The unaudited financial statements for the three months ended 30 September 2017 give effect to the respective adjustments.

Pro-forma Adjustments

The pro-forma adjustments are based on our preliminary estimates and assumptions that are subject to change. The following adjustments have been reflected in the unaudited pro forma financial information:

Statement of Comprehensive Income Adjustments

Wisynco Group Limited Unaudited Pro-forma Statement of Comprehensive Income Period Ended 30 September 2017

J$'000 Q1 2018

Management Adjustments Adjusted Q1 2018

Management

Total Sales 6,125,810 - 6,125,810

Cost of Sales 3,766,127 - 3,766,127

Gross Margin 2,359,683 - 2,359,683

Expenses 1,566,342 - 1,566,342

Net Profit 793,342 - 793,342

Taxation 137,540 - 137,540

Net Profit after Tax 655,802 - 655,802

There are no pro-forma adjustments that will impact the Income Statement.

PRO-FORMA ADJUSTMENTS (Continued)

92

Statement of Financial Position Adjustments

Wisynco Group Limited Unaudited Statement of Financial Position Period Ended 30 September 2017

J$'000 NoteQ1 2018

Management Adjustments

Adjusted Q1 2018

Management

Non-Current Assets Fixed assets 4,892,883 - 4,892,883

Investment in Subsidiary/Associate 1 593,932 (582,557) 11,375

Available for Sale Investments 38,401 38,401

5,525,216 (582,557) 4,942,659

Current Assets Inventories 1,850,898 - 1,850,898

Receivables & Prepayments 2,193,918 - 2,193,918

Cash 2, 3 3,745,420 (1,282,390) 2,463,030

7,790,236 (1,282,390) 6,507,846

Current Liabilities Trade & Other Payables 2,668,166 - 2,668,166

Short-term Borrowings 383,954 - 383,954

Due to Parent Company 2 262,505 (262,505) -

Taxation Payable 451,941 - 451,941

3,766,566 (262,505) 3,504,061

Net Current Assets 4,023,670 (1,019,885) 3,003,785

9,548,886 (1,602,442) 7,946,444

Financed by Shareholders' Equity Share Capital 57,927 - 57,927

Capital Reserve 97,738 - 97,738

Fair value Reserve 22,384 - 22,384

Retained Earnings 1, 3 7,428,210 (1,602,442) 5,825,769

7,606,260 (1,602,442) 6,003,818

Long term Liabilities

Deferred tax 252,460 - 252,460

Loans 1,690,166 - 1,690,166

1,942,626 - 1,942,626

9,548,886 (1,602,442) 7,946,444

D/E 22.2% 28.2%

Gearing Ratio 18.2% 22.0%

Current Ratio 2.07 1.86

PRO-FORMA ADJUSTMENTS (Continued)

93

Explanatory Notes

1. Reflects the preliminary adjustment for the Group reconstruction, where we removed Investment in Subsidiary / Associate as an investment as per the Scheme of Reconstruction and Amalgamation. This includes shares in Seville Development Corporation Limited, Wisynco Foods Limited and Fusion Holdings Limited (St Lucia international business company). Only Investments in Indies Insurance will remain as an investment in subsidiary/associate. The reconstruction is accounted for as an adjustment through Shareholder’s Equity, as it is a transaction among entities under common control.

2. Reflects the repayment of related party debt.

3. Reflects the distribution of surplus cash of approximately US$8 million (J$1.02 billion), as per proposed pre-IPO dividend.

94

13. FINANCIAL STATEMENTS

Wisynco Group Limited Separate Financial Statements 30 June 2017

FINANCIAL STATEMENTS (Continued)

95

Wisynco Group Limited Index 30 June 2017

Page

Independent Auditor’s Report to the Members

Financial Statements

Statement of comprehensive income 1

Statement of financial position 2

Statement of changes in equity 3

Statement of cash flows 4

Notes to the financial statements 5 – 40


96

Independent auditor’s report To the Members of Wisynco Group Limited

Report on the audit of the financial statements

Our opinion

In our opinion, the financial statements give a true and fair view of the financial position of Wisynco Group Limited (the Company) standing alone as at 30 June 2017, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards and with the requirements of the Jamaican Companies Act.

What we have audited

Wisynco Group Limited financial statements comprise:

the statement of financial position as at 30 June 2017;

the statement of comprehensive income for the year then ended;

the statement of changes in equity for the year then ended;

the statement of cash flows for the year then ended; and

the notes to the financial statements, which include a summary of significant accounting policies.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence

We are independent of the Company in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code). We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.

PricewaterhouseCoopers, Scotiabank Centre, Duke Street, Box 372, Kingston, Jamaica T: (876) 922 6230, F: (876) 922 7581, www.pwc.com/jm

L. A. McKnight P.E. Williams A.K. Jain B.L. Scott, B.J. Danning G.A. Reece P.A. Williams R.S. Nathan C.I. Bell-Wisdom G.K. Moore


97

Responsibilities of management for the financial statements

Management is responsible for the preparation of the financial statements that give a true and fair view in accordance with International Financial Reporting Standards and with the requirements of the Jamaican Companies Act, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.


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Report on other legal and regulatory requirements

As required by the Jamaican Companies Act, we have obtained all the information and explanations, which, to the best of our knowledge and belief, were necessary for the purposes of our audit.

In our opinion, proper accounting records have been kept, so far as appears from our examination of those records, and the accompanying financial statements are in agreement therewith and give the information required by the Jamaican Companies Act, in the manner so required.

Chartered Accountants 6 November 2017 Kingston, Jamaica


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Wisynco Group Limited Statement of Comprehensive Income Year ended 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated)

Note 2017 $’000

2016 $’000

Revenue 21,247,767 19,413,691

Cost of sales (13,319,888) (11,676,741)

Gross Profit 7,927,879 7,736,950

Impairment relating to fire 5, 6 - (1,317,390)

Other operating income 5 736,796 1,530,045

Selling and distribution expenses (5,244,802) (4,151,836)

Administration expenses (885,903) (774,564)

Operating Profit 2,533,970 3,023,205

Finance income 8 159,965 124,347

Finance costs 9 (169,746) (146,768)

Profit before Taxation 2,524,189 3,000,784

Taxation 10 (286,312) (702,083)

Net Profit 2,237,877 2,298,701

Other Comprehensive Income

Items that may be subsequently reclassified to profit or loss

Unrealised (loss)/gain on available-for-sale investments (4,344) 9,118

Total Comprehensive Income 2,233,533 2,307,819

Earnings Per Share 11 $2,101.29 $2,158.40


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Wisynco Group Limited Statement of Financial Position 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated)

Note 2017 $’000

2016 $’000

Non-Current Assets Property, plant and equipment 13 4,874,521 3,147,581 Investments in subsidiaries 15 164,434 164,434 Investments in associates 15 429,498 429,498 Available-for-sale investments 16 293,452 229,426

5,761,905 3,970,939 Current Assets

Inventories 17 1,940,382 1,577,331 Receivables and prepayments 18 1,978,610 2,454,993 Available-for-sale investments – current portion 16 184,386 - Cash and short-term deposits 19 3,187,431 3,740,479

7,290,809 7,772,803 Current Liabilities

Trade and other payables 20 3,093,489 3,363,517 Short-term borrowings 21 382,469 341,012 Taxation payable 178,814 532,623 Due to parent company 21 259,745 -

3,914,517 4,237,152

Net Current Assets 3,376,292 3,535,651

9,138,197 7,506,590

Shareholders’ Equity

Share capital 22 57,927 57,927 Capital reserve 23 117,097 121,441 Retained earnings 6,976,619 5,942,963

7,151,643 6,122,331 Non-Current Liabilities Due to parent company 21 - 259,745 Deferred tax liabilities 24 213,565 252,465 Borrowings 21 1,772,989 872,049

1,986,554 1,384,259

9,138,197 7,506,590

Approved for issue by the Board of Directors on 1 November 2017 and signed on its behalf by:


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Wisynco Group Limited Statement of Changes in Equity 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated)

NoteNumber of

Shares

Share

Capital $’000

Capital Reserves

$’000

Retained Earnings

$’000 Total $’000

Balance at 1 July 2015 1,064,632 57,927 112,323 4,546,353 4,716,603



Dividends paid 12 - - - (902,091) (902,091)

Balance at 30 June 2016 1,064,632 57,927 121,441 5,942,963 6,122,331

Total comprehensive income - - (4,344) 2,237,877 2,233,533


Dividends paid 12 - - - (1,204,221) (1,204,221)

Balance at 30 June 2017 1,064,632 57,927 117,097 6,976,619 7,151,643


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Wisynco Group Limited Statement of Cash Flows Year ended 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated)

2017$’000

2016$’000

Operating Activities

Cash provided by operating activities (Note 25) 1,766,967 3,036,987

Cash Flows from Investing Activities

Purchase of property, plant and equipment (2,258,648) (859,862)

Proceeds from the sale of property, plant and equipment 25,199 1,500

Insurance proceeds 479,849 296,010

Purchase of investments (260,295) (197,042)

Proceeds from sale of investments 18,344 -

Investment in subsidiary - (6,500)

Dividend received 3,101 1,734

Interest received 71,736 53,966

Cash used in investing activities (1,920,714) (710,194)

Cash Flows from Financing Activities

Interest paid (158,678) (157,473)

Long-term loans repaid (928,278) (1,246,631)

Long-term loans received 1,900,000 1,000,000

Finance leases repaid (49,041) (41,107)

Dividend paid (1,204,221) (902,091)

Cash used in financing activities (440,218) (1,347,302)

(Decrease)/Increase in cash and cash equivalents (593,965) 979,491

Effects of changes in foreign exchange rates 49,975 215,411

Cash and cash equivalents at beginning of year 3,659,435 2,464,533

Cash and Cash Equivalents at End of Year (Note 19) 3,115,445 3,659,435

The principal non-cash transaction include: (a) Acquisition of property, plant & equipment under finance lease of $28,774,000 (2016 – $59,223,000).


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 1. Identification and Principal Activities

(a) Wisynco Group Limited (the Company) is a limited liability company, incorporated and domiciled in Jamaica. The parent company is Wisynco Group (Caribbean) Limited, a Barbados International Business Company. The ultimate controlling party of the Company is Evesam Investments Holdings Limited, a company incorporated in the Cayman Islands. The registered office of the Company is located at White Marl, St Catherine.

(b) The principal activities of the Company are the bottling and distribution of water and beverages, the manufacturing of a wide range of plastic and foam packaging and disposable products for use in industry, tourism and for the retail trade, the distribution and retailing of food items.

(c) Effective 1 January 2014 Wisynco Group Limited purchased 50% of the shareholdings in Fusion Holdings Limited a company incorporated and resident in St. Lucia.

2. Significant Accounting Policies

(a) Basis of preparation

These financial statements have been prepared in accordance with International Financial Reporting Standards (IFRSs) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) applicable to companies reporting under IFRS. The financial statements comply with IFRS as issued by the International Accounting Standards Board (IASB).

The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain financial assets.

The preparation of financial statements in conformity with IFRSs requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. Although these estimates are based on management’s best knowledge of current events and action, actual results could differ from those estimates. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in Note 4.

Standards, interpretations and amendments to published standards effective in the current year

Certain new standards, interpretations and amendments to existing standards have been published that became effective during the current financial year. The Company has assessed the relevance of all such new standards, interpretations and amendments and has put into effect the following IFRS, which are immediately relevant to its operations.

Amendment to IAS 1, ‘Disclosure initiative’, (effective for accounting periods beginning on or after 1 January 2016). These amendments clarify the existing requirements of IAS 1 and provide additional assistance to apply judgement when meeting the presentation and disclosure requirements in IFRS. The amendment does not affect recognition and measurement. The adoption of the standard did not have any impact on the financial statements.


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated)

2. Significant Accounting Policies (Continued)

(a) Basis of preparation (continued)

Standards, interpretations and amendments to published standards effective in the current year (continued)

IAS 16, ‘Property, plant and equipment’ and IAS 38, ‘Intangible assets, (effective for annual periods beginning on or after 1 January 2016). Both standards are amended to clarify how the gross carrying amount and the accumulated depreciation are treated where an entity uses the revaluation model. The carrying amount of the asset is to be restated to the revalued amount. The split between gross carrying amount and accumulated depreciation is treated in one of two ways. The gross carrying amount may be restated in a manner consistent with the revaluation of the carrying amount, and the accumulated depreciation is adjusted to equal the difference between the gross carrying amount and the carrying amount after taking into account accumulated impairment losses. Alternatively, the accumulated depreciation may be eliminated against the gross carrying amount of the asset. There was no impact from adoption of this amendment, as the Company does not use revenue-based depreciation or amortisation methods.

Amendments to IAS 27, ‘Separate financial statements’ (effective for annual periods beginning on or after 1 January 2016). This amendment allows entities to use the equity method to account for investments in subsidiaries, joint ventures and associates in their separate financial statements. An entity can now account for investments in subsidiaries, joint ventures and associates in its separate financial statements: a) at cost; or b) in accordance with IFRS 9; or c) using the equity method as described in IAS 28. The IASB has also clarified the definition of separate financial statements. There was no impact from adoption of this amendment, as the Company has opted to continue to account for its investments in subsidiaries and associates at cost in its separate financial statements.

Annual Improvements 2014, (effective for annual periods beginning on or after 1 January 2016). The amendments impact the following standards. IFRS 5 was amended to clarify that change in the manner of disposal (reclassification from "held for sale" to "held for distribution" or vice versa) does not constitute a change to a plan of sale or distribution, and does not have to be accounted for as such. The amendment to IFRS 7 adds guidance to help management determine whether the terms of an arrangement to service a financial asset which has been transferred constitute continuing involvement, for the purposes of disclosures required by IFRS 7. The amendment to IAS 19 clarifies that for post-employment benefit obligations, the decisions regarding discount rate, existence of deep market in high-quality corporate bonds, or which government bonds to use as a basis, should be based on the currency that the liabilities are denominated in, and not the country where they arise. There was no impact from adoption of these amendments and clarifications.

Standards, interpretations and amendments to published standards that are not yet effective

At the date of authorisation of these financial statements, certain new standards, amendments and interpretations to existing standards have been issued which were not yet effective for the Company at balance sheet date, and which the Company has not early adopted. The Company has assessed the relevance of all such new standards, interpretations and amendments, has determined that the following may be relevant to its operations, and has concluded as follows:


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 2. Significant Accounting Policies (Continued)


Standards, interpretations and amendments to published standards that are not yet effective (continued)

IFRS 9, Financial Instruments (effective for annual periods beginning on or after 1 January 2018). This standard specifies how an entity should classify and measure financial instruments, including some hybrid contracts. It requires all financial assets to be classified on the basis of the entity's business model for managing the financial assets and the contractual cash flow characteristics of the financial asset; initially measured at fair value plus, in the case of a financial asset not at fair value through profit or loss, particular transaction costs; and subsequently measured at amortised cost or fair value. These requirements improve and simplify the approach for classification and measurement of financial assets compared with the requirements of IAS 39. They apply a consistent approach to classifying financial assets and replace the four categories of financial assets in IAS 39, each of which had its own classification criteria. They also result in one impairment method, replacing the two impairment methods in IAS 39 that arise from the different classification categories. For financial liabilities, the standard retains most of the IAS 39 requirements. The main change is that, in cases where the fair value option is taken for financial liabilities, the part of a fair value change due to an entity’s own credit risk is recorded in other comprehensive income rather than the income statement, unless this creates an accounting mismatch. There has been no significant change in the recognition and measurement of financial liabilities carried at amortised cost from what obtained under IAS 39. The Company is currently assessing the impact of IFRS 9.

IFRS 15, 'Revenue from Contracts with Customers' (effective for accounting periods beginning on or after 1 January 2018). The IASB has published its new revenue standard, IFRS 15 'Revenue from Contracts with Customers'. The U.S. Financial Accounting Standards Board (FASB) has concurrently published its equivalent revenue standard which is the result of a convergence project between the two Boards. IFRS 15 applies to nearly all contracts with customers: the main exceptions are leases, financial instruments and insurance contracts. It specifies how and when an entity will recognise revenue. It also requires entities to provide more informative, relevant disclosures. The standard supersedes IAS 18, 'Revenue', IAS 11, 'Construction Contracts' and a number of revenue-related interpretations. Application of the standard is mandatory for accounting periods beginning on or after 1 January 2018. The Company is assessing the impact of future adoption of the standard.

IFRS 16, ‘Leases’, (effective for annual periods beginning on or after 1 January 2019). In January 2016, the IASB published IFRS 16 which replaces the current guidance in IAS 17. Under IAS 17, lessees were required to make a distinction between a finance lease (on balance sheet) and an operating lease (off balance sheet) IFRS 16 now requires lessees to recognise a lease liability reflecting future lease payments and a ‘right-of-use asset’ for virtually all lease contracts. There is an optional exemption for lessees for certain short-term leases and leases of low-value assets. The Company is currently assessing the impact of IFRS 16.

Amendments to IAS 12, ‘Income Taxes, (effective for annual periods beginning on or after 1 January 2017). In January 2016, the IASB published amendments to IAS 12 clarifying specifically how to account for deferred tax assets related to debt instruments measured at fair value as well as clarifying the guidance for deferred tax assets in general by adding examples and elaborating on some of the requirements in more detail. The amendments do not change the underlying principles for the recognition of deferred tax assets. The Company does not expect any significant impact on its financial statements arising from the future adoption of the amendments.


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Standards, interpretations and amendments to published standards that are not yet effective (continued)

Amendments to IAS 7, ‘Statement of Cash Flows’, (effective for annual periods beginning on or after 1 January 2017). In January 2016, the IASB published amendments to IAS 7 to improve information about an entity's financing activities. These amendments are as part of the IASB initiative to improve presentation and disclosure in financial reports. The amendments require disclosure of information enabling users to evaluate changes in liabilities arising from financing activities including both cash and non-cash changes. The future adoption of these amendments may result in additional disclosure in the financial statements. Amendment to IFRS 15, ‘Revenue from contracts with customers’ (effective for accounting periods beginning on or after 1 January 2018). These amendments comprise clarifications of the guidance on identifying performance obligations, accounting for licences of intellectual property and the principal versus agent assessment (gross versus net revenue presentation). The IASB has also included additional practical expedients related to transition to the new revenue standard. The Company is currently assessing the impact of IFRS 15.

IFRIC 22, ‘Foreign currency transactions and advance consideration’ (effective for annual periods beginning on or after 1 January 2018) This IFRIC addresses foreign currency transactions or parts of transactions where there is consideration that is denominated or priced in a foreign currency. The interpretation provides guidance for when a single payment/receipt is made as well as for situations where multiple payments/receipts are made. The guidance aims to reduce diversity in practice. It does not apply when an entity measures the related asset, expense or income on initial recognition at fair value or at the fair value of the consideration received or paid at a date other than the date of initial recognition of the non-monetary asset or non-monetary liability. Also, the Interpretation need not be applied to income taxes, insurance contracts or reinsurance contracts. The Company is currently assessing the impact of this amendment. IFRIC 23 'Uncertainty over Income Tax Treatments', (effective for annual reporting periods beginning on or after 1 January 2019).This Interpretation clarifies how to apply the recognition and measurement requirements in IAS 12 when there is uncertainty over income tax treatments. In such a circumstance, an entity shall recognise and measure its current or deferred tax asset or liability applying the requirements in IAS 12 based on taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates determined applying this Interpretation. The Company is currently assessing the impact of this amendment. The Company has concluded that all other standards, interpretations and amendments to existing standards, which are published but not yet effective are either relevant to its operations but will have no material impact on adoption; or are not relevant to its operations and will therefore have no material impact on adoption; or contain inconsequential clarifications that will have no material impact when they come into effect.

(b) Investment in subsidiaries and associates Investments in subsidiaries and associates are accounted for at cost less impairment. Cost is adjusted to reflect changes in consideration arising from contingent consideration amendments. Cost also includes direct attributable costs of investment.


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(c) Revenue and income recognition Revenue is shown net of General Consumption Tax or applicable sales tax, returns, rebates and discounts.

Revenue comprises amounts charged to customers in respect of the sale of water and beverages, plastic, foam packaging and disposable products and, general food items.

Sale of goods

Revenue from the sale of merchandise is recognised when significant risks and rewards of ownership of the goods are transferred to the buyer which is upon acceptance of the goods by the customer.

Interest and dividend income

Interest income are recorded on the accrual basis using the effective interest method. Dividends are recognised when the right to receive payments is established.

Other operating income

Other operating income primarily comprising rebates received and the sale of miscellaneous items is recognised as it accrues unless collectibility is in doubt.

(d) Foreign currency translation

Transactions and balances

Foreign currency transactions are accounted for at the exchange rates prevailing at the dates of the transactions. At the year end, monetary assets and liabilities denominated in foreign currency are translated using the closing exchange rate. Exchange differences arising from the settlement of transactions at rates different from those at the dates of the transactions and unrealised foreign exchange differences on unsettled foreign currency monetary assets and liabilities are recognised in the statement of comprehensive income.

Functional and presentation currency

Items included in the financial statements are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’).

(e) Property, plant and equipment

Property, plant and equipment are stated at historical or deemed cost less depreciation.

The carrying values of property, plant and equipment are written off on a straight-line basis over their expected useful lives using the following rates:

Buildings 2½ - 3 ⅓% Furniture, fixtures and equipment 10 - 50% Motor vehicles 20% Leasehold improvements Shorter of the life of the lease or the useful life of the asset

Land is not depreciated.

Gains and losses on disposals are determined by comparing proceeds with carrying amount and are included in operating profit.

Repairs and maintenance expenses are charged to profit or loss during the financial period in which they are incurred. The cost of major renovations is 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 Company. Major renovations are depreciated over the remaining useful life of the related asset.


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(f) Intangible assets

Contracts

Contracts are recorded at cost based and represents consideration paid for right to Bottler’s Agreement. This cost is amortised over the life of the contract which is 3 years.

(g) Impairment of non-current assets

Property, plant and equipment and other non-current assets 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, which is the higher of an asset’s net selling price and value in use. For the purposes of assessing impairment, assets are grouped at the lowest level for which there are separately identifiable cash flows.

(h) Financial instruments

A financial instrument is any contract that gives rise to both a financial asset in one entity and a financial liability or equity of another entity.

Financial assets

The Company classifies its financial assets in the following categories: at fair value through profit or loss and loans and receivables and available –for-sale. The classification depends on the purpose for which the financial assets were acquired. Management determines the classification of its financial assets at initial recognition and re-evaluates this designation at every reporting date.

Financial assets at fair value through profit or loss

This category has two sub-categories: financial assets held for trading, and those designated as fair value through profit or loss at inception. A financial asset is classified in this category if acquired principally for the purpose of selling in the short term or if so designated by management. Assets in this category are classified as current assets if they are either held for trading or are expected to be realised within 12 months of the statement of financial position date. These assets are classified as cash and short term investments and are included in current assets on the statement of financial position.

Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the year end. These are classified as non-current assets. Loans and receivables are classified as balances with related parties, long term receivables and trade and other receivables and are included in non-current and current assets in the statement of financial position. The particular recognition methods adopted are disclosed in the individual policy statements associated with each item.

Available-for-sale

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any other categories. They are included in non-current assets unless management intends to dispose of the investment within 12 months of the statement of financial position date. These are classified as available-for-sale investments and are included in non-current assets.

The fair value of financial instruments traded in active markets is based on quoted market prices at the statement of financial position date. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Company is the current bid price.


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(h) Financial instruments (continued)

Available-for-sale (continued)

These instruments are included in level 1. Instruments included in level 1 comprise primarily JSE equity investments classified as available-for-sale.

Investments intended to be held for an indefinite period of time, which may be sold in response to needs for liquidity or changes in interest rates, are classified as available-for-sale, and are included in non-current assets unless management has the express intention of holding the investment for less than twelve months from the reporting date or unless they will need to be sold to raise operating capital, in which case they are included in current assets.

Purchases and sales of investments are recognised on the trade date, which is the date that the Company commits to purchase or sell the asset. The cost of purchase includes transaction costs. Available-for-sale investments are subsequently carried at fair value. Unrealised gains and losses arising from changes in the fair value of securities classified as available-for-sale are recognised in equity. The fair values of investments are based on quoted bid prices or amounts derived from cash flow models. Fair values for unlisted equity securities are estimated using applicable price/earnings or price/cash flow ratios refined to reflect the specific circumstances of the issuer. Equity securities for which fair values cannot be measured reliably are recognised at cost less impairment. When securities classified as available-for-sale are sold or impaired, the accumulated fair value adjustments are included in the statement of comprehensive income as gains and losses from investment securities.

Financial liabilities

The Company’s financial liabilities are initially measured at fair value, and are subsequently measured at amortised cost using the effective interest method.

(i) Inventories

Inventories are stated at the lower of cost and net realisable value.

The cost of raw materials is determined using the weighted average cost method. The cost of work in progress and manufactured finished goods is determined using standard raw material cost, plus budgeted cost of labour and factory overheads, which approximates actual cost. The cost of finished goods purchased for resale is the suppliers’ invoice price applied on a weighted average basis.

Net realisable value is the estimated selling price in the ordinary course of business, less the costs of completion and selling expenses.

(j) Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. The carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the profit or loss in administration and other expenses. When a trade receivable is uncollectible, it is written off against the allowance account for trade receivables. Subsequent recoveries of amounts previously written off are credited in profit or loss.


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(k) Cash and cash equivalents

Cash and cash equivalents are carried on the statement of financial position at cost. Cash equivalents are short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to insignificant risk of changes in value. For the purpose of the statement of cash flows, cash and cash equivalents comprise investment securities with less than 90 days maturity from the date of acquisition including cash balances, short term deposits, securities purchased under agreements to resell and bank overdrafts.

(l) Payables

Payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Payables are initially recognised at fair value and subsequently stated at amortised cost.

(m) Leases

Leases of property, plant and equipment where the Company has substantially all the risks and rewards of ownership are classified as finance leases. Finance leases are capitalised at the inception of the lease at the lower of the fair value of the leased property or the present value of the minimum lease payments.

Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in non-current borrowings. The interest element of the finance cost is charged to the statement of comprehensive income over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Property, plant and equipment acquired under finance leases are depreciated over the shorter of the useful life of the asset or the lease term.

(n) Borrowings and borrowings costs

Borrowings are recognised initially at the proceeds received, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost and any difference between net proceeds and the redemption value is recognised in the statement of comprehensive income over the period of the borrowings using the effective yield method.

General and specific borrowing costs 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.

Investment income earned on the temporary investment of specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.


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(o) Income taxes

Taxation expense in the income statement comprises current and deferred tax charges.

Current tax charges are based on taxable profits for the year, which differ from the profit before tax reported because it excludes items that are taxable or deductible in other years, and items that are never taxable or deductible. The Company’s liability for current tax is calculated at tax rates that have been enacted at the year end.

Deferred tax is the tax expected to be paid or recovered on differences between the carrying amounts of assets and liabilities and the corresponding tax bases. Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Currently enacted tax rates are used in the determination of deferred income tax.

Deferred 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.

(p) Employee benefits

Pension obligations

The Company participates in a defined contribution plan whereby it pays contributions to a privately administered fund. Once the contributions have been paid, the Company has no further payment obligations. The regular contributions constitute net periodic costs for the year in which they are due and are included in staff costs.

Termination benefits

Termination benefits are payable whenever an employee’s employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy in exchange for these benefits. The Company recognises termination benefits when it is demonstrably committed to either terminate the employment of current employees according to a detailed formal plan without possibility of withdrawal or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than twelve months after the year end are discounted to present value.

Profit sharing plans

A liability for employee benefits in the form of profit sharing plans is recognised when there is no realistic alternative but to settle the liability and at least one of the following conditions is met:

– There is a formal plan and the amounts to be paid are determined before the time of issuing the financial statements; or

– Past practice has created a valid expectation by employees that they will receive a profit sharing and the amount can be determined before the time of issuing the financial statements.

Liabilities for profit sharing plans are expected to be settled within twelve months and are measured at the amounts expected to be paid when they are settled.

Leave entitlements

Employee entitlements to annual leave are recognised when they accrue to employees. A provision is made for the estimated liability for annual leave as a result of services rendered by employees up to the balance sheet date.


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(q) Provisions

Provisions are recognised when the Company has a present legal or constructive obligation as a result of past events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made. Where the Company expects a provision to be reimbursed; the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain.

(r) Dividends

Dividends are recorded as a deduction from equity in the period in which they are approved.

3. Financial Risk Management

The Company’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 Company’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company’s financial performance.

The Company’s risk management policies are designed to identify and analyse these risks, to set appropriate risk limits and controls, and to monitor the risks and adherence to limits by means of reliable and up-to-date information systems. The Company regularly reviews its risk management policies and systems to reflect changes in markets, products and emerging best practice.

The Board of Directors is ultimately responsible for the establishment and oversight of the Company’s risk management framework. The Board has established a Finance Department for managing and monitoring risks. This department is responsible for managing the Company’s assets and liabilities and the overall financial structure. It is also primarily responsible for the funding and liquidity risks of the Company. It identifies, evaluates and hedges financial risks in close co-operation with the operating units.

There has been no significant change to the Company’s exposure to financial risks or the manner in which it manages and measures risk.

(a) Credit risk

The Company takes on exposure to credit risk, which is the risk that its customers, clients or counterparties will cause a financial loss for the Company by failing to discharge their contractual obligations. Credit risk is an important risk for the Company’s business; management therefore carefully manages its exposure to credit risk. Credit exposures arise principally from the Company’s receivables from customers and investment activities. The Company structures the levels of credit risk it undertakes by placing terms and limits on the amount of risk accepted in relation to a single counterparty or groups of related counterparties.

Credit review process

The Company has a credit department whose responsibility involves regular analysis of the ability of customers and other counterparties to meet repayment obligations.


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 3. Financial Risk Management (Continued)

(a) Credit risk (continued)

Credit review process (continued)

(i) Trade and other receivables

The Company’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The credit department has established a credit policy under which each customer is analysed individually for creditworthiness prior to the Company offering them a credit facility. Risky customers are required to provide a banker’s guarantee and credit limits are assigned to each customer, which represents the maximum credit allowable without approval from the credit department; these are reviewed semi-annually. The Company has procedures in place to restrict customer orders if the order will exceed their credit limits. Customers that fail to meet the Company’s benchmark creditworthiness may transact business with the Company on a prepayment basis.

Customers’ credit risks are monitored according to their credit characteristics such as whether the customer is an individual or Company, industry, aging profile, and previous financial difficulties. Trade and other receivables relate mainly to the Company’s wholesale, retail and food service customers.

The Company’s average credit period on the sale of goods is 30 days. The Company has provided fully for all receivables based on an estimate of amounts that would be irrecoverable, determined by taking into consideration past default experience, current economic conditions and expected receipts and recoveries once impaired.

(ii) Investments

The Company limits its exposure to credit risk by investing mainly in liquid securities, with counterparties that have high credit quality. Accordingly, management does not expect any counterparty to fail to meet its obligations.


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Maximum exposure to credit risk

2017 2016

$’000 $’000

Receivables 1,950,799 2,443,773

Cash and short-term deposits 3,187,431 3,740,479

Available-for-sale investments 442,569 182,274

5,580,799 6,366,526

The table above represents a worst case scenario of credit risk exposure at 30 June. During the year, the Company did not renegotiate any trade receivables.

(i) Ageing analysis of trade receivables that are past due but not impaired

Trade receivables that are less than three months past due are not considered impaired. As of 30 June 2017, trade receivables of $372,096,000 (2016 - $341,233,000) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables is as follows:

2017 $’000

2016$’000

31 to 60 days 332,519 292,251

60 to 90 days 39,577 38,325

90 days or more - 10,657

372,096 341,233

(ii) Trade receivable that are considered impaired.

As of 30 June 2017, trade receivables of $33,624,000 (2016 - $33,347,000) were impaired. The amount of the provision was $33,624,000 (2016 - $33,347,000). The individually impaired receivables mainly relate to wholesalers who are in unexpected, difficult economic situations. It was assessed that a portion of the receivables is expected to be recovered. These receivables are aged over 90 days.


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(ii) Trade receivables that are considered impaired (continued)

Movements on the provision for impairment of trade receivables are as follows:

2017 $’000

2016$’000

At 1 July 33,347 37,166

Provision for receivables impairment 10,833 9,490

Bad debt recovered/written off (10,556) (13,309)

At 30 June 33,624 33,347

The creation and release of provision for impaired receivables have been included in expenses in the statement of comprehensive income. Amounts charged to the allowance account are generally written off when there is no expectation of recovering additional cash.

There are no financial assets other than those listed above that were individually impaired.

(iii) Credit exposure for trade receivables

The following table summarises the Company’s credit exposure for trade receivables at their carrying amounts, as categorised by the customer sector:

2017 $’000

2016$’000

Kingston & St. Andrew 695,006 462,311

South Central 193,735 193,051

North Eastern 123,348 77,605

Western 72,938 207,609

Hotels & Restaurants 410,483 321,549

Other 48,406 95,251

1,543,916 1,357,376

Less: Provision for credit losses (33,624) (33,347)

1,510,292 1,324,029

The majority of trade receivables are receivable from customers in Jamaica.


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(b) Liquidity risk

Liquidity risk is the risk that the Company is unable to meet its payment obligations associated with its financial liabilities when they fall due. Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions.

Liquidity risk management process

The Company’s liquidity management process, as carried out within the Company and monitored by the Finance Department, includes:

(i) Monitoring future cash flows and liquidity on a regular basis. This incorporates an assessment of expected cash flows and the availability of high grade collateral which could be used to secure funding if required.

(ii) Maintaining committed lines of credit;

(iii) Optimising cash returns on investment;

The maturities of assets and liabilities and the ability to replace, at an acceptable cost, interest-bearing liabilities as they mature, are important factors in assessing the liquidity of the Company and its exposure to changes in interest rates and exchange rates.

Financial liabilities cash flows

The tables below summarises the maturity profile of the Company’s financial liabilities at 30 June based on contractual undiscounted payments at contractual maturity dates.

Assets available to meet all of the liabilities and to cover financial liabilities include cash and short term deposits.

Within 1

Month 1 to 3

Months3 to 12

Months 1 to 5 Years

Over 5 Years Total

$’000 $’000 $’000 $’000 $’000 $’000

2017

Liabilities

Borrowings including finance leases 91,129 48,812 418,681 2,046,569 156,992 2,762,183

Trade and other payables 2,441,476 417,791 - - - 2,859,267

Due to parent company - - 272,732 - - 272,732

Total financial liabilities 2,532,605 466,603 691,413 2,046,569 156,992 5,894,182


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(b) Liquidity risk (continued)

Financial liabilities cash flows (continued)

Within 1

Month 1 to 3

Months 3 to 12 Months

1 to 5 Years

Over 5 Years Total

$’000 $’000 $’000 $’000 $’000 $’000

2016

Liabilities

Borrowings including finance leases 94,567 86,988 255,379 1,041,276 - 1,478,210

Trade and other payables 2,976,256 297,746 956 - - 3,274,958

Due to parent company - - 12,987 259,745 - 272,732

Total financial liabilities 3,070,823 384,734 269,322 1,301,021 - 5,025,900

(c) Market risk

The Company takes on exposure to market risks, which is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risks mainly arise from changes in foreign currency exchange rates and interest rates. Market risk is monitored by the Finance Department. Market risk exposures are measured using sensitivity analysis.

(i) Currency risk

Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Company is exposed to foreign exchange risk primarily with respect to the US dollar. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities.

The Company manages its foreign exchange risk by ensuring that the net exposure in foreign assets and liabilities is kept to an acceptable level by monitoring currency positions. The Company further manages this risk by maximising foreign currency earnings and holding foreign currency balances.

Concentrations of currency risk

The Company has accounts receivable, cash and deposits net of accounts payable denominated in United States dollars, amounting to an asset of J$1,537,083,000 (2016 - J$1,945,471,000). The Company also has cash and deposits denominated in Euros, amounting to an asset of J$315,612,000 (2016 - J$93,199,000).


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(c) Market risk (continued)

(i) Currency risk (continued)

Foreign currency sensitivity

The following tables indicate the currencies to which the Company had significant exposure on their monetary assets and liabilities and forecast cash flows. The change in currency rate below represents management’s assessment of the possible change in foreign exchange rates. The sensitivity analysis represents outstanding foreign currency denominated monetary items and adjusts their translation at the year end for a reasonably expected change in foreign currency rates. The sensitivity of the profit was primarily as a result of foreign exchange gains and losses on translation of trade receivables and payables.

% Change in

Currency Rate

Effect on Profit

before Taxation% Change in

Currency Rate

Effect on Profit

before Taxation

%2017$’000 %

2016$’000

Currency: USD +1% (15,371) +1% (19,455)

USD -6% 92,225 -6% 116,728

EURO +1% (3,156) +1% (932)

EURO -6% 18,937 -6% 5,592


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(ii) Interest rate risk

Interest rate risk is the risk that the value or future cash flows of a financial instrument will fluctuate because of changes in market interest rates.

Floating rate instruments expose the Company to cash flow interest risk, whereas fixed interest rate instruments expose the Company to fair value interest risk.

The Company’s interest rate risk policy requires it to manage interest rate risk by maintaining an appropriate mix of fixed and variable rate instruments. The policy also requires it to manage the maturities of interest bearing financial assets and interest bearing financial liabilities.

The following tables summarises the exposure to interest rate risk. It includes the financial instruments at carrying amounts, categorised by the earlier of contractual repricing or maturity dates.

Within 1

Month 1 to 3

Months3 to 12

Months 1 to 5 Years

Over

5 Years

Non-Interest Bearing Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000

2017

Assets

Available-for-sale investments - 184,386 258,183 - - 35,269 477,838

Receivables - - - - - 1,950,799 1,950,799

Cash and short-term deposits 2,238,706 948,254 - - - 471 3,187,431

Total financial assets 2,238,706 1,132,640 258,183 - - 1,986,539 5,616,068

Liabilities

Borrowings 75,499 18,131 288,839 1,620,989 152,000 - 2,155,458

Trade and other payables 2,441,476 417,791 - - - - 2,859,267

Due to parent company - - 259,745 - - - 259,745

Total financial liabilities 2,516,975 435,922 548,584 1,620,989 152,000 - 5,274,470

Total interest repricing gap (278,269) 696,718 (290,401) (1,620,989) (152,000) 1,986,539 341,598


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(ii) Interest rate risk (continued)

Within 1

Month 1 to 3

Months3 to 12

Months 1 to 5

Years Over 5 Years

Non-Interest Bearing Total

$’000 $’000 $’000 $’000 $’000 $’000 $’000

2016

Assets

Available-for-sale investments - - 182,274 - - 47,152 229,426

Receivables - - - - - 2,449,914 2,449,914

Cash and short-term deposits 2,134,481 1,605,527 - - - 471 3,740,479

Total financial assets 2,134,481 1,605,527 182,274 - - 2,497,537 6,419,819

Liabilities

Borrowings 93,807 61,276 185,929 872,049 - - 1,213,061

Trade and other payables 2,985,558 297,746 8,870 - - - 3,292,174

Due to parent company - - - 259,745 - - 259,745

Total financial liabilities 3,079,365 359,022 194,799 1,131,794 - - 4,764,980

Total interest repricing gap (944,884) 1,246,505 (12,525) (1,131,794) - 2,497,537 1,654,839

Interest rate sensitivity

The Company has no significant sensitivity to interest rate risk as all borrowings are at fixed rates.

(d) Capital management

The Board’s policy is to maintain a strong capital base to maintain customer, creditor and other stakeholder confidence, and to sustain future development of the business. The Board of directors monitors the return on capital, which is defined as total shareholders’ equity. The Company is not subject to any externally imposed capital requirements.


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(e) Fair value estimation

Financial instruments that are measured in the statement of financial position at fair value are classified by level in one of the following fair value measurement hierarchy:

Level 1 includes those instruments which are measured based on quoted prices in active markets for identical assets or liabilities.

Level 2 includes those instruments which are measured using inputs other than quoted prices within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices).

Level 3 includes those instruments which are measured using valuation techniques that include inputs for the instrument that are not based on observable market data (unobservable inputs).

The Company’s financial instruments classified as available-for-sale investments are disclosed in (Note 16). Unquoted available-for-sale investments are classified as level 2 and quoted instruments are classified as level 1.

The amounts included in the financial statements for cash and short-term deposits, receivables, payables, short-term loans and due to parent company reflect their approximate fair values because of the short-term maturity of these instruments.

The fair value of long term borrowings approximates carrying value as the contractual cash flows are at current market interest rates that are available to the Company for similar financial instruments.

4. Critical Accounting Judgements and Key Sources of Estimation Uncertainty

Judgements and estimates are continually evaluated and are based on historical experience and other factors, including expectation of future events that are believed to be reasonable under the circumstances.

(a) Critical judgements in applying the Company’s accounting policies

In the process of applying the Company’s accounting policies, management has not made any judgements that would cause a significant impact on the amounts recognised in the financial statements.

(b) Key sources of estimation uncertainty

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

Income taxes

Estimates are required in determining the provision for income taxes. There are some transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognises liabilities for possible tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

Provision for impairment of trade receivables

Periodically, the Company assesses the collectibility of its trade receivables. Provisions are created or increased as described in Note 2(j). This, however, does not necessarily mean that the Company will collect the total remaining unimpaired balance, as some balances that are estimated to be collectible at period end may subsequently go bad.


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 5. Other Operating Income

2017 2016 $'000 $'000

Bad debts recovered 8,315 13,100

Discount received 33,339 27,468

Rebates 28,403 25,818

Gain/(loss) on disposal of property, plant and equipment 1,524 (6,232)

Insurance proceeds – warehouse 479,849 296,010

Insurance proceeds – inventory claim - 1,138,886

Insurance proceeds – business interruption 156,623 -

Other 28,743 34,995

736,796 1,530,045

During prior year, the Company had a fire incident which resulted in impairment losses in the amount of $1,317,390,000. The related insurance proceeds represents funds received for business interruption, loss of warehouse building, solar panels and inventory totalling $636,472,000 (2016- $1,434,896,000).

6. Expenses by Nature

2017 2016

$'000 $'000 Advertising costs 856,899 752,647

Audit fees 8,486 8,335

Bad debt expense 12,526 10,445

Commissions and discounts 178,219 179,593

Cost of inventory recognised as expense 10,814,186 9,401,328

Delivery and motor vehicle expense 1,164,176 825,233

Insurance 153,360 83,583

Impairment relating to fire - 1,317,390

Property expenses, including depreciation 1,354,946 1,195,863

Royalties 16,319 7,612

Staff costs (Note 7) 3,217,534 2,838,249

Utilities 579,670 463,588

Directors fees 18,000 18,000

Other operating expenses 1,076,272 818,665

19,450,593 17,920,531


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 7. Staff Costs

2017 2016

$'000 $'000

Wages and salaries 2,609,428 2,285,916

Statutory contributions 279,539 257,457

Pension contributions (Note 26) 101,866 91,350

Termination costs 1,115 6,566

Other 225,586 196,960

3,217,534 2,838,249

8. Finance Income

2017 2016

$'000 $'000

Dividend income 3,101 1,734

Interest income 71,736 53,966

Gain on sale of investment 10,805 -

Foreign exchange gains 74,323 68,647

159,965 124,347

9. Finance Costs

2017 2016

$'000 $'000

Interest expense -

Bank borrowings and finance leases 158,678 142,399

Finance charges and non interest fees 11,068 4,369

169,746 146,768


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 10. Taxation

The taxation charge is computed on the profit for the year, adjusted for tax purposes, and comprises income tax at 25% (2016 - 25%):

2017 2016

$'000 $'000

Current income tax 416,794 720,992

Deferred income tax (Note 24) (38,900) 12,362

Adjustment to prior year estimate (91,582) (31,271)

286,312 702,083

The tax on the Company’s profit differs from the theoretical amount that would arise using the statutory tax rate as follows:

2017 2016

$’000 $’000

Profit before tax 2,524,189 3,000,784

Tax calculated at applicable tax rate 631,047 750,196

Adjusted for the effects of:

Income not subject to tax (139,752) (11,207)

Expenses not deductible for tax purposes 19,919 36,616

Adjustment to prior year estimate – current tax (91,582) (31,271)

Adjustment to prior year estimate – deferred tax (55,226) 7,326

Tax credit (78,880) (50,087)

Other 786 510

Tax charge 286,312 702,083

11. Earnings per Share

Earnings per share is calculated on net profit and is based on the weighted average number of ordinary shares in issue during both years.

2017 2016

Net profit attributable to ordinary shareholders ($’000) 2,237,877 2,298,701

Weighted average number of ordinary shares in issue (‘000) 1,065 1,065

Basic earnings per share $2,101.29 $2,158.40


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 12. Related Party Transactions and Balances

The following companies are related parties by virtue of:

Being subsidiaries of the Company: Seville Development Corporation Limited Wisynco Foods Limited Indies Insurance Company

Holding shares in the company: Wisynco Group Caribbean Limited Caribbean Bottlers Limited

Associate:

Fusion Holdings Limited and its major subsidiaries, Trade Winds Citrus Limited and United Estates Limited.

Affiliate:

Affiliates comprise companies over which the Company has control.

The Company entered into the following significant transactions with related parties during the year:

(a) Transactions

2017 2016

$’000 $’000

Sales

Wisynco Foods Limited 618,780 525,303

Purchases Trade Winds Citrus Limited

2,771,089 2,650,424

Wisynco Foods Limited

2,364 1,942

Interest expense Seville Development Corporation Limited

314 536

Wisynco Group Caribbean Limited 12,987 12,987

2017 2016

$’000 $’000

Rebates –


Royalties -

Trade Winds 16,319 7,612


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 12. Related Party Transactions and Balances (Continued)

(b) Year-end balances

Receivables (Note 18) 2017 2016

$’000 $’000

Receivables from subsidiary -


Receivable from Associate -

Trade Winds Citrus 29,869 20,836

Receivables from affiliates 1,975 815

Included in receivables and prepayments 149,181 98,792

Payables (Note 20) 2017 2016

$’000 $’000

Payables to subsidiaries -

Seville Development Corporation Limited 26,928 27,250

Indies Insurance Company 339 359

Wisynco Foods Limited 311 51

27,578 27,660

Payables to associate -

Trade Winds Citrus Limited 391,522 291,377

Payable to director 361 65

Payables to parent company -

Wisynco Group Caribbean Limited 38,000 48,100

Included in trade and other payables 457,461 367,202


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 12. Related Party Transactions and Balances (Continued)

(c) Key management compensation

2017 $’000

2016 $’000

Salaries and other short-term employee benefits 177,923 120,500

Statutory contributions 9,064 8,471

Pension benefits 7,418 6,805

194,405 135,776

Directors’ emoluments –

Management remuneration (included above) 194,405 135,776

Fees 18,000 18,000

(d) Loans from related parties

2017 2016

$’000 $’000

Wisynco Group (Caribbean) Limited -

At beginning of year 259,745 259,745

Payments made (11,039) (11,039)

Interest charged 11,039 11,039

Included in non-current borrowings (Note 21) 259,745 259,745

(e) Dividends of US$8.56 (2016 - US$6.94) per share were paid to shareholders amounting to $1,204,221,000

(2016 - $902,091,000).


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 13. Property, Plant and Equipment

Land and Buildings

Furniture, Fixtures &

EquipmentMotor

Vehicles Leasehold

Improvements Total

$’000 $’000 $’000 $’000 $’000

Cost -

At 1 July 2015 1,392,849 3,585,907 237,969 19,066 5,235,791

Additions 315,118 454,263 149,704 - 919,085

Disposals - - (8,780) - (8,780)

Impairment (213,445) (106,128) - - (319,573)

At 30 June 2016 1,494,522 3,934,042 378,893 19,066 5,826,523

Additions 1,454,011 701,169 132,242 - 2,287,422

Disposals (763) (43,106) (2,100) (34) (46,003)

At 30 June 2017 2,947,770 4,592,105 509,035 19,032 8,067,942

Depreciation -

At 1 July 2015 342,686 1,903,652 103,800 19,032 2,369,170

Charge for the year 42,920 377,435 31,534 - 451,889

Relieved on disposal - - (1,048) - (1,048)

Impairment (114,211) (26,858) - - (141,069)

At 30 June 2016 271,395 2,254,229 134,286 19,032 2,678,942

Charge for the year 46,336 431,640 58,831 - 536,807

Relieved on disposal (636) (19,592) (2,100) - (22,328)

At 30 June 2017 317,095 2,666,277 191,017 19,032 3,193,421

Net Book Value -

30 June 2017 2,630,675 1,925,828 318,018 - 4,874,521

30 June 2016 1,223,127 1,679,813 244,607 34 3,147,581


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 14. Intangible Assets

Contracts

$’000

At Cost -

At 1 July 2015 , 2016 and 30 June 2017 41,900

Amortisation -

At 1 July 2015 , 2016 and 30 June 2017 41,900

Net Book Value -

30 June 2017 -

30 June 2016 -

15. Investment in Subsidiaries and Associates

2017 2016

Subsidiaries - $’000 $’000

Seville Development Corporation Limited – 85% 323,981 (2016 – 323,981) Ordinary shares, fully paid 32,303 32,303

Wisynco Foods Limited – 100% 1,000 (2016– 1,000) Ordinary shares, fully paid 120,756 120,756

Indies Insurance Company – 100% 50,000 Ordinary shares, fully paid 11,375 11,375

164,434 164,434

Associates -

Fusion Holdings Limited 429,498 429498

16. Available-for-Sale Investments

2017 $’000

2016 $’000

At beginning of year 229,426 23,266

Additions 260,295 197,042

Disposals (7,539) -

Fair value gains charged to fair value reserve (4,344) 9,118

Current portion (184,386) -

At end of year 293,452 229,426

Quoted 35,269 47,152

Unquoted 258,183 182,274


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 17. Inventories

2017 2016

$’000 $’000

Raw materials 744,971 480,939

Finished goods 139,745 105,084

Merchandise for resale 622,679 420,581

1,507,395 1,006,604

Less: Provision for obsolete inventories (29,780) (24,517)

1,477,615 982,087

Goods-in-transit 462,767 595,244

1,940,382 1,577,331

18. Receivables and Prepayments

2017 2016

$’000 $’000

Trade receivables 1,543,916 1,357,376

Less: Provision for doubtful debts (33,624) (33,347)

Trade receivables, net 1,510,292 1,324,029

Prepayments 27,811 11,220

Receivables from related parties (Note 12(b)) 149,181 98,792

Principal receivables 238,275 267,004

Other receivables 53,051 753,948

1,978,610 2,454,993


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 19. Cash and Cash Equivalents

2017 2016

$’000 $’000

Cash and bank balances 915,149 949,237

Short-term deposits 2,272,282 2,791,242

3,187,431 3,740,479

Bank overdrafts (Note 21) (71,986) (81,044)

3,115,445 3,659,435

The weighted average effective interest rates on cash and short-term bank deposits at the year-end are as follows:

2017 2016

% %

Short-term deposits – J$

6.00 5.22

US$ 2.25 2.3

20. Trade and Other Payables

2017 2016

$’000 $’000

Trade payables 1,797,567 1,902,106

Statutory contributions payable 47,464 56,627

Accrued expenses 411,959 559,497

Insurance payable 121,549 119,432

Payables to related parties (Note 12 (b)) 457,461 367,202

Other payables 257,489 358,653

3,093,489 3,363,517


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 21. Borrowings

(a) Composition of borrowings

2017 2016

$’000 $’000

Total borrowings -

Bank loans -

Long term 2,022,222 1,050,500

Finance leases 61,250 81,517

Bank overdraft 71,986 81,044

2,155,458 1,213,061

Related party loans 259,745 259,745

2,415,203 1,472,806

Current -

Bank overdraft (Note 19) (71,986) (81,044)

Current portion of finance leases (38,039) (41,190)

Current portion of long term loans (272,444) (218,778)

Related party loans (259,745) -

Total current borrowings (642,214) (341,012)

Non-current borrowings 1,772,989 1,131,794


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 21. Borrowings (Continued)

(a) Composition of borrowings (continued)

2017 2016

$’000 $’000

Non-current -

Bank of Nova Scotia (9.55%, 2016) - 8,333

MF&G Trust (10% - 11.5%) 61,250 81,517

National Commercial Bank (8.75% -9.563%, 2018-2023) 2,022,222 1,042,167

Wisynco Group Caribbean Limited (Note 12(d)) 259,745 -

2,343,217 1,132,017

Less: Current portion (570,228) (259,968)

1,772,989 872,049

Related party loan -

Wisynco Group Caribbean Limited (Note 12(d)) - 259,745

1,772,989 1,131,794

Non-current borrowings

All loans held by the company are unsecured.

The loan from Wisynco Group (Caribbean) Limited represents promissory notes which were issued in consideration for the transfer of the investments in subsidiaries to the company in 2003. They attract interest at 5% per annum and were repayable in 2011. Management was granted an extension to repay the balance in the fiscal year ending 30 June 2017. The balance is expected to be repaid prior to the end of next fiscal year ending 30 June 2018.


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 21. Borrowings (Continued)

(a) Composition of borrowings (continued)

Finance lease liabilities – minimum lease payments

2017 2016

$’000 $’000

Not later than 1 year 42,339 47,447

Later than 1 year and not later than 5 years 24,323 43,403

66,662 90,850

Future finance charges on finance leases (5,412) (9,333)

Present value of finance lease liabilities 61,250 81,517

The present value of the finance lease liabilities is as follows:

2017 2016

$’000 $’000

Not later than 1 year 38,039 41,190

Later than 1 year and not later than 5 years 23,211 40,327

61,250 81,517

(b) Interest rate risk exposure

The weighted average effective interest rates on borrowings at the year-end were as follows:

2017 2016

% %

Current -

Bank overdraft 10.00 10.00

Other 8.75 – 9.56 9.25 – 10.61

Non-current -

Bank borrowings 8.75 - 9.56 9.25 – 10.61

Finance leases 10.00 – 11.00 10.00 – 11.50

Loans from related parties 5.00 5.00


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 22. Share Capital

2017 2016

$’000 $’000

Authorised –

1,100,000 (2016 – 1,100,000) Ordinary shares

Issued and fully paid –

1,064,632 (2016 – 1,064,632) Ordinary shares at no par value 57,927 57,927

23. Capital Reserve

2017 2016

$'000 $'000

Realised gains 24,998 24,998

Unrealised surplus on revaluation of land and buildings 72,740 72,740

Fair value gains on available-for-sale investments 19,359 23,703

117,097 121,441

Realised gains

This represents realised gains on sale of assets.

Unrealised surplus on revaluation of land and building

This represents freehold land and buildings which were valued in 1993 by Stoppi Cairney Bloomfield and the resulting revaluation surplus of $126,400,000 was credited to capital reserve. The revalued amounts were used as the deemed cost of these assets, upon transition to IFRS.

Fair value gains on available-for-sale investments

This represents the fair value of quoted equity instruments.

24. Deferred Income Taxes Deferred income taxes are calculated in full on temporary differences under the liability method using a principal tax rate of 25% (2016 – 25%).

The movement on the deferred income tax account is as follows:

2017 2016

$’000 $’000

At the beginning of the year 252,465 240,103

(Credited)/charged to income profit or loss (Note 10) (38,900) 12,362

At end of year 213,565 252,465


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 24. Deferred Income Taxes (Continued)

The movement in deferred tax assets and liabilities during the year is as follows:

Deferred tax liabilities

Finance lease

Excess of Capital

Allowances over

Depreciation

Unrealised Foreign

Exchange Gain Total

$’000 $’000 $’000 $’000

At 1 July 2015 10,524 256,564 7,608 274,696

Charged/(credited) to profit or loss 24,323 (33,947) 2,894 (6,730)

At 30 June 2016 34,847 222,617 10,502 267,966

Charged/(credited) to profit or loss (34,847) 13,101 (3,263) (25,009)

At 30 June 2017 - 235,718 7,239 242,957

Deferred tax assets

Accrued Vacation

Finance

Lease

Unrealised Foreign

Exchange Losses

Interest Payable

Total

$’000 $’000 $’000 $’000 $’000

At 1 July 2015 24,808 - 6,017 3,768 34,593

Credited/(charged) to profit or loss (15,774) - 450 (3,768) (19,092)

At 30 June 2016 9,034 - 6,467 - 15,501

Credited/(charged) to profit or loss (1,638) 15,312 217 - 13,891

At 30 June 2017 7,396 15,312 6,684 - 29,392

The amounts shown in the statement of financial position include the following to be recovered or settled after more than twelve months:

2017 2016

$'000 $'000

Deferred tax assets to be recovered 15,312 -

Deferred tax liabilities to be settled 235,718 257,464


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 24. Deferred Income Taxes (Continued)

Deferred income tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred income taxes relate to the same fiscal authority. The following amounts, determined after appropriate offsetting, are shown in the statement of financial position

2017

$’000 2016 $’000

Deferred tax assets - -

Deferred tax liabilities (213,565) (252,465)

At end of year (213,565) (252,465)

25. Cash Provided by Operating Activities

Cash provided by operating activities includes the following amounts:

2017 2016

$'000 $'000

Net profit from operations 2,237,877 2,298,701

Items not affecting cash:

Depreciation 536,807 451,889

(Gain)/loss on sale of property, plant and equipment (1,524) 6,232

Gain on fire claim (636,472) (1,434,896)

Impairment in relation to fire - 1,317,390

Interest income (71,736) (53,966)

Gain on disposal of investments (10,805) -

Dividend income (3,101) (1,734)

Interest expense 158,678 142,399

Taxation expense 286,312 702,083

Exchange gain on foreign currency balances (25,819) (140,301)

2,470,217 3,287,797

Changes in operating assets and liabilities:

Inventories (363,051) (1,288,380)

Receivables and prepayments 480,375 (269,013)

Trade and other payables (298,176) 1,116,228

Cash generated from operations 2,289,365 2,846,632

Insurance proceeds 156,623 655,350

Taxation paid (679,021) (464,995)

Cash provided by operating activities 1,766,967 3,036,987


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Wisynco Group Limited Notes to the Financial Statements 30 June 2017 (expressed in Jamaican dollars unless otherwise indicated) 26. Pension Scheme

The Company participates in a defined contribution pension plan administered by Sagicor Life Jamaica Limited. Members contribute 5% of pensionable earnings which is matched by the employer. The employer also matches additional voluntary contributions, not exceeding 5%, made by members aged 45 and over who have 10 or more years of service. Pension contributions for the year was $101,866,000 (2016 - $91,350,000) and are included in staff costs (Note 7).

27. Subsequent Events

(a) The Company was approved for a loan in October 2017 with the Bank of Nova Scotia Jamaica Limited for $725 million to facilitate the purchase and installation of new machinery for the bottling plant. To date no drawdown has taken place.

(b) On 19 October 2017, the Board of Directors approved an interim dividend in respect of 2018 of US$7.52 per ordinary share to shareholders on record as at that date.

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14. RISK FACTORS

In addition to other information in this Prospectus, the following risk factors should be considered carefully in evaluating the Company’s business. The Company’s business, financial condition or results of operations could be materially and adversely affected by any of these risks.

The risks mentioned in this Section are not to be taken as being exhaustive of all the possible risks that may affect the Company and its business. Readers are therefore requested to exercise their own judgement in assessing various risks associated with the Company.

The Board of Directors is ultimately responsible for the establishment and oversight of the risk management framework. The Board has established an Audit & Risk Committee for managing and monitoring risks. In addition, the Executive Management Committee of the Company actively manages the risks associated with the Company’s operations.

BUSINESS RISKS

The Company’s business depends substantially on consumer tastes and preferences that may change in often unpredictable ways. Failure to satisfy changing consumer preferences could adversely affect the profitability of the Company’s business. As it deems appropriate, the Company invests in formal and informal consumer research to predict as best as it can such changes and put in place plans to minimize any negative effect on the business.

The Company’s success also depends in large part on its ability to maintain consumer confidence in the safety and quality of all its products. The Company has rigorous product safety standards and quality controls and also applies an ISO 9001 quality management system which enhance production safety and reduces the risks of its operations. However, if beverage products taken to market are or become contaminated or adulterated, the Company may be required to conduct product recalls and may become subject to product liability claims and negative publicity, which would cause its business to suffer. The Company insures itself against consumer liability.

Global health and wellness trends over the past several years have resulted in a shift from sugar sparkling beverages to other alternatives. This trend is likely to impact Jamaica in the medium to long-term period.

Consumers, public health officials, public health advocates and government officials are becoming increasingly concerned about the public health consequences associated with obesity, particularly among young people. The production and marketing of beverages are subject to the rules and regulations of various regulatory bodies and other local, regional and international health agencies. The Company has a strong presence of zero sugar and low sugar alternatives in its product portfolio to mitigate the negative impact of further shift away from sweetened products.

In addition, regulatory actions, activities by nongovernmental organizations, public debate and concerns about perceived negative safety and quality consequences of certain ingredients in the Company’s products, such as non-nutritive sweeteners, may erode consumers’ confidence in the safety and quality of the Company’s products, whether or not justified, and could result in additional governmental regulations. The possible negative implications for the Company could be a reduction in demand, possible new taxes and in the remote case possible litigation, which could affect the Company’s profitability.

However, the Company is constantly reinventing itself as proven innovators to adapt to current and future market changes.

REGULATORY RISKS

Concerns about limited natural resources, pollution and waste, and clean water and air have become global in scope. As a result, there has also been increased lobbying for environmental regulations that may change the design, manufacture, use, and disposal activity of products in many industries.

Specifically in the case of Jamaica, it is possible that potential regulations may be introduced that may result in the Company changing the raw material source of its Sweet brand of packaging (Styrofoam products), which is likely to increase production costs.

RISK FACTORS (Continued)

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To mitigate this risk, the Company is investing in research and development activities to explore the creation of products that will ensure the balance between profitability and regulatory compliance. In addition, the Company remains committed to historical activity of promoting sustainable manufacturing activities including the use of Eco-Foam and its recycling initiatives.

COMPLIANCE RISK

The Company also relies on its ability to procure various regulatory licences, registrations and permits for its manufactured goods and imported ingredients. If for any reason the Company is not able to procure new reissued regulatory licences, registrations permits in its name, or renewals of them, its business would be in breach of the relevant regulatory regimes and the Company and/or its officers could be subject to penalties or prosecution. Currently, the Company is in compliance with its existing licenses and regulations in all material respects.

SUPPLIERS AND BRANDS SWITCHING RISK

The successful operations of the Company depend on its ability to procure certain products from key suppliers including distribution partners. There is a risk that some of these suppliers and brands may choose other parties to distribute their products.

If such relationships were terminated or impaired, the Company’s turnover and profits would suffer in the short to medium-term while it takes steps to increase sales of its other products, develop alternative products, and attract and build relationships with other key partners. It should be noted that the Company’s owned branded products account for approximately 46% of its sales, but more importantly, no single non-related-party brand portfolio accounts for more than 12% of revenue. The Company is also in good standing with all its third-party brand owners.

OPERATIONAL RISK

The Company is subject to the risk of loss resulting from disruptions to its business, inadequate or failed internal processes, people and systems, or from external events (including severe weather, other Acts of God, social unrest or insurrection). This definition also includes systemic risk (including the risk of accounting errors, failure to procure appropriate insurance coverage, and compliance failures), legal risk and reputation risk. This catch-all category of risks also includes employee errors, computer and manual systems failures, security failures, fire, floods or other losses to physical assets, and fraud or other criminal activity or any other risk that affects the volume of visitor arrivals to the island.

The Company carries standard business insurance policies that cover business interruption and property damages due to fire, flood or other routine risks. The Company also carries normal third-party insurance such as public liability and is exploring possibility to carry director’s indemnity insurance.

PRODUCT STANDARDS RISK

Significant additional labelling or warning requirements may inhibit sales of affected products. The Bureau of Standards in Jamaica or other relevant regulatory bodies occasionally propose major changes to the nutrition labels required on all packaged foods and beverages, including those for most of the Company’s products. If the proposed changes are adopted, the Company and its competitors will be required to overhaul nutrition labels, including updating serving sizes, information about total calories in a beverage product container and information about any added sugars or nutrients. Pervasive nutrition label changes could increase the Company’s costs and could inhibit sales of one or more of the Company’s major products. The Company does not anticipate such changes will occur in the short to medium-term and does not see this having a major impact on financial performance but could have an impact on operational packaging activities.

KEY PERSONNEL AND PARTNERS

It is important that the Company attracts and retains appropriately skilled personnel, including management and Executive Directors of the Company, who specialize in distinct areas of the Company’s management. In Jamaica, there are a limited number of persons with the requisite skills, knowledge and experience required by the Company. In respect of senior managers and key Executive Directors (who are long-standing employees for several years and also shareholders) there is expected to be no change in the near future. Furthermore, the primary purpose of the


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ESOP plan outlined in Section 8 of this Prospectus and also the creation of the Employee’s Reserve Shares is to ensure that critical talents are retained and motivated.

The Company relies on its key and on-going business relationships with customers and suppliers. If the Company’s relationship with any of these parties is disrupted or terminated for any reason, the Company would have to identify new customers and suppliers. However, this risk may be mitigated by the Company’s policy of creating and maintaining symbiotic relationships with its key partners and by seeking to provide itself with the components of its products by investing in integrated businesses. Furthermore, Wisynco’s customer base is highly diversified with no single customer representing more than 7% of overall sales. In addition, the creation of Strategic Investor Shares is to mitigate against this risk.

CLIMATE CONDITION RISK

Natural disasters, changing weather patterns and unfavourable weather could negatively impact the Company’s future profitability. Natural disasters or unfavourable weather conditions in the geographic regions in which the Company operates could have an adverse impact on the Company’s revenue and profitability. For instance, unusually cold or rainy weather during the summer months may have a temporary effect on the demand for the Company’s products and contribute to lower sales, which could adversely affect the Company’s profitability for such periods. Prolonged drought conditions could lead to restrictions on water use, which could adversely affect the Company’s cost and ability to manufacture and distribute products.

Changing weather patterns, along with the increased frequency or duration of extreme weather and climate events could impact some of the Company’s facilities or the availability and cost of key raw materials used by the Company in production. In addition, legislative and regulatory initiatives proposed by the various regulatory bodies could directly or indirectly affect the Company’s production, distribution and packaging, the cost of raw materials, fuel, ingredients and water, which would impact the Company’s profitability. The Company continually seeks advice and conducts research as necessary to mitigate these risks and balance them with consumer demands for conveniently packaged and priced products.

GENERAL ECONOMIC AND MARKET CONDITIONS

The Company is also subject to the risks presented by potential shifts in the local and international macroeconomic environment and their impact on variables such as business and consumer confidence. Any major changes in the Jamaica’s macroeconomic environment may negatively affect the operations and financial performance of the Company.

According to the International Monetary Funds' Economic Outlook Database as at October 2017 (http://www.imf.org/), Jamaica's GDP's yearly growth rate is expected to move from 1.3% in 2016 to 2.8% by 2022, while the country's Gross Debt-to-GDP is expected to decrease significantly from approximately 107% to 74%. Unemployment rates are also expected to decrease from approximately 12% in 2017 to 9.5% in 2022. Inflation rates however are expected to rise to a rate of approximately 5.4% by 2022 (currently 3.4%).

FUEL PRICE VOLATILITY

Increases in fuel prices or the inability of the Company to secure adequate supplies of fuel could have an adverse impact on the Company’s profitability.

The Company uses significant amounts of fuel for its delivery fleet and other vehicles used in the distribution of its products. International or domestic geopolitical or other events could impact the supply and cost of fuel and could impact the timely delivery of the Company’s products to its customers. Although the Company strives to reduce fuel consumption and when and if it deems appropriate has in the past used commodity hedges to manage the Company’s fuel costs, there can be no assurance the Company will succeed in limiting the impact of fuel price volatility on the Company’s business or future cost increases, which could reduce the profitability of the Company’s operations.

Based on the NYMEX Light Crude Oil Index (http://futures.tradingcharts.com), Crude Oil prices are expected to move from current price of 55.28 to 51.70 in December 2022.


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GEOGRAPHIC CONCENTRATION RISK

The business model and scale of the Company is not geographically diversified, resulting in heavy concentration on the Jamaican economy and also currency risks. The Company’s vision, as articulated in Section 7, is to use the proceeds from the IPO to manage this risks through expansion (regionally and internationally).

The Company is taking steps to increase the markets which it distributes to and to have a stronger presence in other countries within the Caribbean, the United States and the United Kingdom. The Company has recently invested in additional beverage production capacity of approximately 40% with the strategic goal to increase export sales with the aim of diversifying geographically.

NEW ACCOUNTING RULES OR STANDARDS

The Company may become subject to new accounting rules or standards that differ from those that are presently applicable. Such new accounting rules or standards could require significant changes in the way the Company currently reports its financial position, operating results or cash flows. Such changes could be applied retrospectively. This is a risk that is not faced by the Company alone but also, by any trading business operating in Jamaica. In respect of new standard on leases (for example IFRS 16), this is not expected to have a significant impact as the Company already accounts for most leases as finance leases. See Note 2 of the Audited Financial Statements for expected changes in Significant Accounting Policies and potential impact, if any.

TAXATION OF LISTED SHARES

Transfers of any ordinary shares on the JSE are exempt from transfer tax and stamp duty in Jamaica. Dividends received by a shareholder in the Company may or may not be subject to tax in the country where the shareholder is resident. Each prospective shareholder should consult with an independent adviser as to the rate of taxes that is applicable to the shareholder.

RISKS IN RELATION TO FIRST ISSUE

This being the first public issue of Shares by the Company, no formal market for the Shares has been established. The Subscription Price for each of the Shares has been determined by the Directors on the advice of NCB Capital Markets Limited as lead broker and financial adviser to the Company. The Subscription Price should not be taken to be indicative of the market price of the Shares after they are listed on the JSE. No assurance can be given regarding active or sustained trading in either the Shares of the Company or regarding the price at which either of the Shares will be traded subsequent to listing of the Shares on the JSE.

LISTING

There is also no assurance that the Shares will remain listed on the Main Market of the JSE. Although it is currently intended that the Shares will remain listed on the JSE, there is no guarantee of the continued listing of the Shares. Among other factors, the Company may not continue to satisfy any future listing requirements of the JSE. Shareholders will not be able to sell their Shares on the JSE if the Shares are no longer listed.

RISKS RELATING TO MARKETABILITY OF SHARES

The Shares, even if listed on the JSE, may not be readily saleable and shareholders who may want to “cashout” may not be able to do so or may only be able to do so at a discount.

TRADING PRICES AND OTHER VOLATILITY

The trading price of the Shares may fluctuate significantly after their listing on the JSE (or irrespective of it). The Shares may experience flat trading, being very infrequent or insignificant volumes of trading, either of which may extend beyond the short term and which may be dependent on the Company’s financial performance, as well as on investors’ confidence and other factors over which the Company has no control. In either case, the market price of the Shares may be negatively affected or constrained from growing. Also, the JSE is relatively small and the market in the Shares is expected to be relatively thin compared to larger capital markets, trades in small quantities of either or both of the Company’s Shares can trigger wide swings (up or down) in the market price of either or both of the Shares and make it easier for the stock price to be manipulated.


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ISSUE OF ADDITIONAL SHARES

The Directors may hereafter authorise the issue of additional shares in the Company. Such shares, once issued, may rank pari passu with and/or in priority of the existing Shares and may be listed on the JSE. Additional shares so issued could affect the market price of the Shares currently being offered.

RISK MANAGEMENT FRAME WORK

In today’s challenging and competitive environment, strategies for mitigating inherent risks in accomplishing the growth plans of the Company are imperative. The common risks inter alia are: regulations, competition, business environment, changing consuming preferences, and retention of talent and expansion of facilities. As a matter of policy, these risks are assessed and steps as appropriate, are taken by the Company, on an ongoing basis, to mitigate the same.

Wisynco has adopted a systematic approach to mitigate risks associated with accomplishment of objectives, operations, revenues and regulations. The Company’s objectives can be viewed in the context of four categories: (1) Strategic, (2) Operations, (3) Reporting and (4) Compliance. This includes considering activities at all levels of the organization. The Company’s Risk Management frame work focusses on the following three key elements, (1) Risk Assessment; (2) Risk Management; (3) Risk Monitoring.

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15. PROFESSIONAL ADVISORS TO THE COMPANY

ARRANGER AND LEAD BROKER

NCB Capital Markets Limited

The Atrium

32 Trafalgar Road

Kingston 10, Jamaica

FINANCIAL ADVISORS

PricewaterhouseCoopers Tax & Advisory Services Limited

Scotiabank Centre

Duke Street, Box 372

Kingston, Jamaica

REGISTRAR AND PAYING AGENT

Jamaica Central Securities Depository Limited

40 Harbour Street

Kingston, Jamaica

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ATTORNEYS 1

Debbie-Ann Gordon & Associates

79 Harbour Street

Kingston, Jamaica

ATTORNEYS 2

Patterson Mair Hamiltion

Temple Court

85 Hope Road

Kingston 6, Jamaica

AUDITORS

PricewaterhouseCoopers

Scotiabank Centre

Duke Street, Box 372

Kingston, Jamaica

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16. STATUTORY AND GENERAL INFORMATION

STATUTORY INFORMATION REQUIRED TO BE SET OUT IN THIS PROSPECTUS BY SECTION 41 AND THE THIRD SCHEDULE TO THE COMPANIES ACT

1. The Company has no founders’ or management or deferred shares.

2. The Articles of Incorporation fix no shareholding qualification for directors (Article 94) and none has been otherwise fixed by the Company in general meeting.

3. The Articles of Incorporation contain the following provisions with respect to the remuneration of Directors:

The remuneration of the Directors shall from time to time be determined by the Company in general meeting. Such remuneration shall be deemed to accrue from day to day (Article 91). The Directors shall be paid such travelling, hotel and other expenses as may properly be incurred in connection with their attendance at meetings of Directors or committees of directors or general meetings or separate meetings of the holders of any class of shares or of debentures of the Company or otherwise in connection with the discharge of their duties and the business of the Company (Article 92)

The Directors may award special remuneration out of the funds of the Company by way of salary, percentage of profits or otherwise (as determined by the Directors) to any Director going or residing abroad in the interest of the Company, or undertaking any work additional to that usually required of Directors of a Company similar to this or Directors may be paid all travelling, hotel and other expenses properly incurred by them in attending at a meeting of the Board or otherwise in connection with the discharge of their duties (Article 93).

A Director may enter into or be interested in contracts or arrangements with the Company (whether with regard to any such office or place of profit or any such acting in a professional capacity or as vendor, purchaser or otherwise howsoever) and may have or be interested in dealings of any nature whatsoever with the Company and shall not be disqualified from office thereby. No such contract, arrangement, or dealing shall be liable to be avoided nor shall any Director so contracting, dealing or being so interested be liable to account to the Company for any profit arising out of any such contract, arrangement, or dealing to which he is a party or in which he is interested by reason of his being a Director of the Company or of the fiduciary relationship thereby established. A Director who is so interested as aforesaid shall be counted in the quorum at any meeting at which such matter is considered but shall not vote in respect of any such contract or arrangement (Article 102)

A Director may hold any other office or place of profit under the Company in conjunction with the office of Director for such period and on such terms as to remuneration and otherwise as the Directors may determine, and a Director or any firm in which he is interested may act in a professional capacity for the Company and he or such firm shall be entitled to remuneration for professional services as if he were not a Director; provided that nothing contained in these presents shall authorize a Director or any such firm to act as auditor to the Company (Article 105).

STATUTORY AND GENERAL INFORMATION (Continued)

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The Directors may provide benefits, whether by the payment of pensions, annuities, gratuities and superannuation or other allowances or by insurance or other benefits to any persons who are or have at any time been Directors of or employed by or in the service of the Company, or any Company which is a subsidiary or a predecessor in business of the Company of any such subsidiary and for any member of his family (including a spouse and a former spouse or any person who is or was dependent on him) of the Company and may (as well before as after he ceases to hold such office or employment) set up, establish, support and maintain pension, superannuation or other funds or schemes (whether contributory or non-contributory) or pay premiums for the purchase or provision of any such benefit. Any Director shall be entitled to receive and retain for his own benefit any such pension, annuity, gratuity, allowance or other benefit, and may vote as a Director in respect of the exercise of any of the powers of this article conferred upon the Directors notwithstanding that he is or may be or become interested therein (Article 107).

The Directors may from time to time appoint one or more of their body to the office of Managing Director or Managing Directors or to any other executive office of the Company, and may fix his or their remuneration either by way of salary or commission or by conferring a right to participation in the profits of the Company, or by a combination of two or more of those modes, and may provide as a term of his appointment that there be paid to him, his widow or other dependents a pension or gratuity on retirement or death and the terms of such employment need not be confirmed by the Company in general meeting. All references to a Managing Director shall include an executive officer appointed by the Directors (Article 133).

The Company was incorporated on 9 April 9 1999 with registered office Lakes Pen St. Catherine Jamaica

4. The names and addresses of the Directors appear in Section 9 DIRECTORS AND MANAGEMENT of this Prospectus. The addresses of the respective directors and executive management are as follows:

Name of Director Address

John Lee 20 Wellington Drive, Kingston 6, Saint Andrew, Jamaica

Lisa Soares Lewis 22B Old Hope Rd, Kingston 5, , Saint Andrew Jamaica

Adam Stewart 5 Kent Avenue, P.O. Box 100, Montego Bay, St. James, Jamaica

William Mahfood Lakes Pen, St. Catherine, Jamaica

Andrew Mahfood Lakes Pen, St. Catherine, Jamaica

Francois P. Chalifour Lakes Pen, St. Catherine, Jamaica

Devon Hugh Reynolds Lakes Pen, St. Catherine, Jamaica

Joseph M Mahfood Lakes Pen, St. Catherine, Jamaica

Sean Scott Lakes Pen, St. Catherine, Jamaica

Gerald Mahfood Lakes Pen, St. Catherine, Jamaica

Halcott V. Holness Lakes Pen, St. Catherine, Jamaica

Christopher Ramdon Lakes Pen, St. Catherine, Jamaica

Andrew Fowles Lakes Pen, St. Catherine, Jamaica

Jacinth Bennett Lakes Pen, St. Catherine, Jamaica

Caron Anderson Lakes Pen, St. Catherine, Jamaica

5. The minimum amount required to be raised out of the proceeds of the Invitation to provide for the matters set out in paragraph 2 of Part 1 of the Third Schedule to the Companies Act (the “minimum subscription”) is J$5.82 billion.


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6. The Invitation will open at 9:00 a.m. on 6 December 2017 and will close at 4:00 p.m. on the Closing Date, 15 December 2017 subject to the Company’s right to close the application list at any time after 9:00 a.m. on the Opening Date if Applications have been received for an amount in excess of the Shares offered under this Prospectus, or to extend the Closing Date in the sole discretion of the Company, for any reason whatsoever.

7. No previous offer of Shares has been made to the public.

8. All Applicants (including Reserved Share Applicants) will be required to pay in full the Subscription Price of J$7.87 per Share, subject to discounts, where applicable. No further sum will be payable on allotment.

9. As at the date of the Prospectus, the Company held investments amounting to J$2.50 billion. These investments include the short-term deposits, available-for-sale-investments and investment in subsidiary Indies Insurance.

10. As at the date of the Prospectus, the Company had indebtedness of J$2.07 billion made up of bank loans and finance leases.

11. Details of the Company’s trade mark, real property and business name are set out in Section 7 INFORMATION ABOUT THE COMPANY of this Prospectus. However, there is no amount for goodwill, patent, or trademarks shown in the financial statements of the Company and there is no contract for sale and purchase which would involve any goodwill, patent or trade mark.

12. There is no property that is currently proposed to be purchased or acquired by the Company which is to be paid for wholly or partly out of the proceeds of this Invitation for the purposes of paragraphs 6 to 9 (inclusive) of Part 1 of the Third Schedule of the Companies Act.

13. The Company and its shareholders expect to pay the expenses of the Invitation out of the proceeds of its fundraising, and the Company estimates that such expenses will not exceed J$200 million.

14. The Auditors of the Company are PricewaterhouseCoopers (“PwC”) of Duke Street, P.O Box 372, Kingston.

15. PricewaterhouseCoopers has given and not withdrawn its consent to the issue of this Prospectus with the inclusion of the Financial Information, and its name in the form and context in which it is included.

16. The offer for the subscription/purchase of the Shares pursuant to the Invitation is not underwritten.

17. Within the last 2 years preceding the date of this Prospectus, no amount or benefit has been paid or given or is intended to be paid or given to any promoter or person in connection with the sale of Shares in the Company save that NCB Capital Markets is entitled to receive fees for services, pursuant to an engagement letter dated October 27, 2017, calculated with reference to the total amount raised from Applications for Shares in the Invitation (which fees are included in the total amount of expenses indicated in paragraph 14 of Section 16 of this Prospectus).

18. The material contracts of the Company are set out in Section 8 INCORPORATION AND STRUCTURE of this Prospectus.

19. As at the date of this Prospectus, the Company is not involved in any litigation, arbitration or similar proceedings pending and/or threatened against the Company.


149

17. DOCUMENTS AVAILABLE FOR INSPECTION

Copies of the following documents may be inspected at the offices of Debbie-Ann Gordon & Associates between the hours of 9:00 a.m. and 4:00 p.m. on Monday to Friday, up to and including the Closing Date (or the extended Closing Date, as the case may be):

1. The Articles of Incorporation of the Company adopted as at 19 October 2017.

2. The Company’s Certificate of Incorporation.

3. Company’ Letter of Good Standing issued by the Registrar of Companies.

4. The Company’s Tax Compliance Certificate as at 26 September 2017.

5. The Auditor’s Report and audited financial statements of the Company for the five (5) fiscal years ended 30 June 2017. The unaudited financial statements of the Company for the period 1 July 2017 to 30 September 2017.

6. Regulatory, permits, certificates and licenses specified in Section 7.

7. Copies of trade marks certificates and certificates of owned real property referred to in Section 7.

8. The material contracts referred to in Section 8.

9. Confirmation of the insurance arrangements referred to in Section 8.

10. Other relevant documents

150

18. DIRECTORS’ SIGNATURES

November 27

151

19. APPENDICES

A.1. APPLICATION FORM – ORDINARY SHARES

PRIMARY HOLDER

PLEASE READ CAREFULLY BEFORE COMPLETING THIS FORM

To: WISYNCO GROUP LIMITED (“Wisynco”)

Re: Invitation for Subscription for up to 784,500,000 ordinary shares (the “Application Shares”)

in Wisynco made pursuant to the Prospectus dated the 28th day of November, 2017 (the “Prospectus”).

I/We confirm that I/we have read and understood and hereby agree to be bound by the terms and conditions contained in the

Prospectus, all of which are incorporated in this Application Form by reference.

I/We hereby apply for [ units of ] Ordinary Shares in Wisynco on and subject to the terms and

conditions of the Invitation set out in the Prospectus at the price of JMD 7.87. I/We have made/remitted payment of the sum of JMD

for my/our subscription/purchase and the JCSD processing fee of JMD 163.10 (inclusive of GCT) with

proof of payment attached or I/we request my broker, NCB Capital Markets Limited to make payment on my/our behalf from cleared

funds held by them in my /our names in account numbered, with them.

I/We agree to accept the Application Shares or any smaller number in respect of which this application may be accepted, subject

to the terms and conditions in the Prospectus and the Articles of Incorporation of Wisynco , by which I/We agree to be bound. I/We

request you to sell and/or transfer to me/us the number of Application Shares, which may be allocated to me/us at the close of the

said Invitation on the terms and conditions governing applications, as set forth in the Prospectus. I/We hereby agree to accept the

Application Shares that may be allocated to me/us to be credited to an account in my/our name(s) in the Jamaica Central Securities

Depository.

Instructions to completing application form: All fields are relevant and must be completed. (If you already have an account with the

JCSD, please ensure that you indicate your JCSD Account number). Please indicate your JCSD account number here.

Reserved Shares Staff Strategic Partner General

(If applicable, see overleaf & the Prospectus)

dinary shares (the “Application Shares”)

pursuant to the Prospectus dated the 20th day of November, 2017 (the “Prospectus”).

ead and understood and hereby agree to be bound by the terms and conditions contained in the

e incorporated in this Application Form by reference.

[ units of ] Ordinary Shares in Wisynco on and subject to the terms and

ospectus at the price of JMD 7.87. I/We have made/remitted payment of the sum of JMD

for my/our subscription/purchase and the JCSD processing fee of JMD 163.10 (inclusive of GCT) with

equest my broker to make payment on my/our behalf from cleared funds held by them in my /our

ed , with them.

es or any smaller number in respect of which this application may be accepted, subject

ospectus and the Articles of Incorporation of Wisynco , by which I/We agree to be bound. I/We

es, which may be allocated to me/us at the close of the

ning applications, as set forth in the Prospectus. I/We hereby agree to accept the

es that may be allocated to me/us to be credited to an account in my/our name(s) in the Jamaica Central Securities

.

e relevant and must be completed. (If you already have an account with the

e that you indicate your JCSD Account number). Please indicate your JCSD account number here.

es Staff Strategic Partner General

ospectus)

Telephone (Cellular)

Occupation / Line of Business

Telephone (Home)

Broker Account Number

Full Name of Applicant

Telephone(Work)

Email Address

Facsimile

Address

TRN

Nationality or Incorporation

JCSD Number

Signatures (Company)

Signatures (individual)

Broker Code

DIRECTOR DIRECTOR/SECRETARY

SEAL OR STAMP REQUIRED FOR COMPANIES

APPLICANT

152

A.1. APPLICATION FORM – ORDINARY SHARES

SECONDARY HOLDERS

Occupation

Occupation

Occupation

Full Name (First Joint)

Full Name (Second Joint)

Full Name (Third Joint)

TRN

TRN

TRN

Signatures (individual) Date



PAYMENT VERIFICATION INFORMATION

Cheque Amount InstitutionCheque number

Sender’s Account Name

Sender’s Account Name

Amount

Amount

Institution

Institution

Transit Code

Mangers Cheque

ACH/RTGS

Online Transfer

Confirmation / Reference #

Confirmation / Reference #

Sender’s Account #

Sender’s Account #

BIC:BankAccount #

REFUND AND DIVIDEND MANDATE

Bank Name

Branch Number

If Bank Account is selected then payments will be made to the Bank Account stated in this section. If Broker Account is selected

then payments will be made using the broker information provided in the Primary Holder section above.

Branch Name

Bank Account Type Currency Savings Chequing JMD USD

Please tick one of the boxes to indicate where dividend payments are to be directed Bank Account Broker Account

Payment Date

153

1. Applicants must apply for a minimum of 1,000 Shares with increments in multiples of 100. Applications in other denominations will

not be processed or accepted. This restriction is not applicable to Applicants for Reserved Shares

2. If you are not a Reserve Share Applicant you must attach your payment for the specified number of Shares you have applied for,

in the form of either:

a. Manager’s cheque made payable to NCB Capital Markets Limited;

b. Transfer or deposit of funds to the following account:

3. If you are a Reserve Share Applicant, please so specify in the reserved share section on Application Form. You must attach

payment for the specified number of Reserve Shares you are applying for.

4. If you are applying jointly, with any other person you must complete the Joint Holder Information and each joint holder must sign

the Application Form at the place indicated.

5. All Applicants must be at least 18 years old.

6. Share certificates will not be issued unless specifically requested. Instead, the shares allotted to a successful applicant will be

credited to his account at the Jamaica Central Securities Depository. If the applicant does not have a JCSD account, one will be

created and the allotted shares deposited to that account. Applicants may refer to the notice posted on the JSE website (www.

jamstockex.com) for instructions on confirming Share allotments.

7. Applicants who do not have a broker account must provide valid identification, proof of address, proof of source of funds and

satisfy NCB Capital Markets Limited’s customer acceptance requirements for account opening.

8. In the event of an over-subscription of shares and where an Applicant is entitled to a refund, such refunds will be made by elec-

tronic transfers to Applicants whose Applications are not accepted, or whose Applications are only accepted in part, within 10

working days after the Closing Date (or the shortened or extended Closing Date, as the case may be) or soon thereafter. Each

Applicant’s refund will be processed as instructed by the Applicant in the Refund and Dividend Mandate section of this Applica-

tion. Please note that the JCSD processing fee of J$163.10 will not be refunded to an Applicant in the event that the Company

refunds payments received for Sale Shares.

9. All Applicants are deemed to have accepted the terms and conditions set out in the Prospectus generally.

1. Bank: National Commercial Bank Jamaica Limited

2. BIC: JNCBCMKX

3. Branch: 1-7 Knutsford Boulevard (New Kingston)

4. Account Name: NCB Capital Markets Limited

5. Beneficiary Address: NCB Atrium, 32 Trafalgar Road, Kingston 10

6. Account number: 241406067

ADDITIONAL INFORMATION

NCB CAPITAL MARKETS LIMITED

FOR USE BY BROKER ONLY

Time Received

Date of Cheque/Electronic Transfer

Pool

Date Application Received

Payment Amount

Payment Method Cheque Electronic Transfer

Broker Authorised Signatory & Stamp

154

155

A.2. AUDITOR’S CONSENT LETTER

The Board of Directors Wisynco Group Limited Lakes Pen St. Catherine 10 November 2017

Attention: Mr. Andrew Mahfood

Dear Sirs

Re: Consent letter for inclusion of ‘Auditors’ Reports’ in Prospectus for the issue of Ordinary Shares of Wisynco Group Limited

In accordance with Section 42 of the Companies Act 2004 (Expert’s consent to issue of prospectus containing statement by him), PricewaterhouseCoopers hereby consents to:-

(1) The inclusion of our ‘Auditors’ Reports’ as set out in Section 10 of this document and as required

by Part II of the Third Schedule of the Companies Act 2004; and (2) The subsequent issue of this prospectus containing our ‘Auditors’ Reports’ as referred to in part

(1).

We further confirm that this statement of consent has not been withdrawn prior to the submission of this prospectus for registration with the Registrar of Companies on 14 November 2017.

Yours very truly

RSN:tr

Documents

INVITATION TO THE PUBLIC FOR SUBSCRIPTION/PURCHASE of ...wisynco.com/wp-content/uploads/2017/11/Wisynco-Group-Limited... · 1 A copy of this Prospectus was delivered to the Registrar