Less current portion included in short-term borrowings
264
40
222
1
3 791
4 056
3 631
3 853
Plant and machinery of Mozambique subsidiaries with a book value of R581 million (2015: R497 million) are encumbered as security for the secured long-term borrowings and certain short-term borrowings of R84 million (2015: R97 million).
Short-term borrowings comprise call loans and bank overdrafts with various South African financial institutions at interest rates linked to the prime overdraft rate as well as short-term borrowings in Mozambique equivalent to R71 million (2015: R50 million) and in Zimbabwe equivalent to R94 million (2015: R191 million).
Summary of future loan repayments by financial year:
Year
2016/17
2017/18
2018/19
2019/20
2020/21
Thereafter
Rmillion
264
1 778
923
907
180
3
In terms of the company's memorandum of incorporation, the borrowing powers exercisable by the directors is limited to R23 295 million.
The non-recourse equity-settled BEE borrowings comprise:
Effective
interest
rate
4 122 000 Class B redeemable preference shares
80% of prime (2015: 77% of prime)
689
697
Less BEE cash resources
84
43
605
654
These borrowings relate to Tongaat Hulett's black economic empowerment partners, yoMoba SPV Proprietary Limited and
TH Infrastructure SPV Proprietary Limited, which have been fully consolidated in terms of IFRS. yoMoba SPV Proprietary
Limited owns 11 157 767 ordinary shares and TH Infrastructure SPV Proprietary Limited owns 13 947 209 ordinary shares in Tongaat Hulett.
The original preference share structure, comprising Class A and Class B redeemable preference shares, ran up until mid-2014 and had a fixed coupon payable semi-annually on 2 January and 1 July each year. The Class A redeemable preference shares were repaid on 1 July 2014, while the repayment terms of the Class B redeemable preference shares were extended to
31 July 2016 with the option of an extension to 31 July 2017. The dividend payable on these shares is also payable on
31 July 2016. The debt due will be settled by the SPVs utilising the shares that they hold in Tongaat Hulett together with dividends received from Tongaat Hulett. These SPVs will continue to be consolidated while Tongaat Hulett carries a residual risk in these entities.
16.
PROVISIONS (Rmillion)
Consolidated
Company
2016
2015
2016
2015
Post-retirement medical aid obligations
600
542
450
427
Retirement gratuity obligations
226
198
130
122
Other
3
826
743
580
549
Further details on provisions are set out in note 31.
17.
TRADE AND OTHER PAYABLES (Rmillion)
Consolidated
Company
2016
2015
2016
2015
Accounts payable
3 520
2 899
1 589
1 327
Maize obligation - interest bearing
376
246
376
246
3 896
3 145
1 965
1 573
The directors consider that the carrying amount of trade and other payables approximates their fair value.
18.
OPERATING PROFIT (Rmillion)
Consolidated
Company
2016
2015
2016
2015
Revenue
16 676
16 155
8 405
8 508
Cost of sales - cane, sugar and maize purchases
(5 448)
(5 138)
(4 527)
(4 224)
Cost of sales - other (includes goods, services, salaries and wages, root replant costs and offcrop)
(7 863)
(7 394)
(2 813)
(3 003)
Administration and other expenses
(1 728)
(1 581)
(673)
(707)
Marketing and selling expenses
(373)
(367)
(233)
(244)
Other net income (including growing crops fair value change *)
Operating lease charges (property, plant and vehicles)
85
68
78
62
(Loss)/surplus on disposal of property, plant and equipment
(4)
(4)
(1)
2
Share-based payments:
IFRS 2 charge on SARS, LTIP and DBP
60
85
44
73
BEE IFRS 2 charge
17
18
16
16
Technical fees paid
20
17
20
17
Translation of foreign currencies
22
16
5
1
Valuation adjustments:
Financial instruments
5
1
5
1
Fair value hedges:
Net gains on the hedged item
57
37
57
37
Net losses on the hedging instrument
(57)
(37)
(57)
(37)
*This represents the gross change in fair value. The agricultural costs actually incurred in generating this increase in fair value are charged to cost of sales.
