Annual Report
2012
C O N T E N T S
Chief Executive Officer’s Statement
Directors
Statement of Directors’ Responsibilities
Directors’ Report
Report of the Independent Auditors, KPMG Audit LLC, to the members of Cambria Africa Plc.
Consolidated Income Statement
Consolidated Statement of Comprehensive Income
Consolidated Statement Changes in Equity
Consolidated and Company Statement of Financial Position
Consolidated and Company Statement of Cash Flows
Notes to the Financial Statements
Corporate information
Shareholder information
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E D Z O W I S M A N
Chief Executive Officer’s Statement
The 2012 financial year was a year of significant change
for Cambria Africa plc (“Cambria” or the “Company”).
The Annual General Meeting (AGM) of the Company held
on February 24th, 2012, resulted in an almost entirely new
Board of Directors, with four new Directors replacing the
five Directors representing Lonrho plc (Lonrho).
significant receivable balances relating to the aircraft lease
agreements and the Churchill Estates Loan.
Arrival of the new Board commenced an exciting new era
for Cambria. In line with the launch of this promising new
period the Company was renamed Cambria Africa plc, a
name invoking a period of growth and renewal.
The transition away from Lonrho signalled the cessation of
significant costs borne by the Company resulting from the
Lonrho Management Services Agreement.
The change in governance permitted the Company to fo-
cus on value creation and profitability and to concentrate
on four investments: Payserv, the Leopard Rock Hotel,
Millchem, and Celsys.
Furthermore, the new Board decided to take a more
prudent view of the value of the various assets on the
Company’s balance sheet. This review has resulted in
significant additional write-offs
in Operating Losses
amounting to US$ 19.6 million, with the vast majority
relating to intangible assets primarily concerning the Cel-
sys and FMNA investments, the non-compete agreement
with Lonrho Plc, extraordinary deterioration in market val-
ue of aircraft under lease agreement and the write-off of
Page 2
Zimbabwe’s economic growth, which until recently
continued at a pace well-beyond the growth of many
of its peers in Sub-Saharan Africa, a region itself already
growing faster than most other parts of the world, slowed
markedly. Where Zimbabwe’s Gross Domestic Product
(GDP) growth was 9.3% in 2011 (Source: Ministry of Finance
of Zimbabwe), ranking it the 11th fastest growing economy
in the world (Source: IMF), estimated GDP growth for 2012
is 4.7% (Source: Ministry of Finance of Zimbabwe). Even
though growth has slowed, Zimbabwe is still in an attrac-
tive position compared to many of its peers.
With the date of the referendum for the newly agreed
constitution now set for March 16th 2013, and elec-
tions anticipated shortly thereafter, 2013 will un-
doubtedly be an
for Zimbabwe.
Anecdotal evidence suggests the agreement on a new
constitution has already resulted in an increased interest
by investors in the country as an investment destination.
Increased investor confidence should lead to reinvigorated
GDP growth levels going forward.
important year
Zimbabwe’s inflation remains low at 3.7% for 2012,
comparing well with inflation levels in, for example, the
United States (2.1%) and South Africa (5.8%).
Cambria Africa Plc Chief Executive Officer’s Statement (continued)
During the 2012 financial year (FY2012) Cambria’s reve-
Results for the Period
nues increased by 48% to US$12.0million (FY2011: US$
8.1 million) and gross profit increased by 45% to US$ 6.8
million (FY2011: US$ 4.7 million (adjusted for reallocation
of certain labour costs at the Leopard Rock Hotel)).
Combined revenue and gross profit of Cambria’s four core
investments during FY2012 showed impressive growth.
Revenues grew 52% from US$8.0 million in FY2011 to
US$ 12.0 million in FY2012. Gross Profit increased by 54%
to US$6.8 million, up significantly from US$4.4million in
FY2011. (adjusted for reallocation of certain labour costs at
the Leopard Rock Hotel).
As at 31 August, 2012, the Company had net assets of US$
23.3 million (2011: US$ 52.0 million) and a market capi-
talization of US$ 9.0 million. Cambria’s assets, following
the various write-offs undertaken during the period under
review, are almost entirely tangible (US$ 33.0 million or
94%).
There is a significant discount between the value of the
Company’s net assets and its market capitalization on the
AIM market. As at February 19, 2013, this discount was
approximately 61% when compared to net assets per share
as at 31 August 2012.
Given the growth rates of the Company’s investments,
and its increasingly attractive outlook towards group wide
profitability, the Board continues to be cognisant of this
discount. As such, and as long as this position continues,
the Board will review strategic alternatives for all of its
investments to unlock (and/or make more apparent) some
of the value built-up within its underlying investments. The
outcome of this review may lead to, but may not be limited
to, a potential sale of certain assets.
On 16 September 2011 the Company raised US$ 1.4 million
gross by way of a placing with institutions of 3,988,439 new
ordinary par value shares of £0.0001 each at 23p per share.
On 9 March 2012, through its second largest shareholder
Consilium Investment Management, Cambria obtained a
combined US$ 3.0 million shareholder loan.
The Financial Statements are prepared in accordance with the
Directors decision announced in the Chief Executive Review
in the accounts of 31 August 2011, to change the functional
currency of the Company from Pounds Sterling to US Dollars.
Consolidated results of core investments
Operational Review Core Investments
Cambria’s core portfolio consists of Payserv, the Leop-
ard Rock Hotel, Millchem and Celsys. These invest-
ments jointly had a consolidated revenue and gross
profit performance as per the following table:
(Audited US$ millions)
2012
2011
GROWTH
Revenues
Gross profit (1)
12.0
6.8
7.9
4.4
Gross margin
57%
56%
52%
54%
2%
(1) For comparison, FY2011 gross profit adjusted for re-al-
location of certain Hotel labour costs to SGA
Growth during FY2012 was entirely organic and can be at-
tributed to the changes made and the initiatives identified,
during the strategic reviews of each of these companies:
addition of new offerings in existing markets, adding new
markets for existing offerings, as well as the impact of more
efficient exploitation of existing platforms.
Millchem and Celsys achieved particularly high year-on-
year gross profit growth of 93% and 159%, respectively.
Payserv (100% holding)
Payserv, previously trading as Paynet Group, provides EDI
switching services (Paynet), payroll services (Autopay),
and payroll based microfinance loan processing (Tradanet
(51% holding).
(Audited: US$ millions)
2012
2011
GROWTH
Revenues
Gross profit
4.0
3.6
3.0
2.2
Gross margin
92%
74%
30%
62%
25%
Paynet provides Electronic Data Interchange (EDI) services
to all 22 banks and building societies in Zimbabwe, as well
as to over 1,500 corporates (FY2011: over 1,100). Paynet
processed 12.3 million transactions (FY2011: 8.3 million)
during the period under review, or a 48% increase.
Page 3
Financial Report 2012 Chief Executive Officer’s Statement (continued)
Autopay, provides payroll services to 172 customers
(FY2011: 113), processed over 286,000 pay slips (FY2011:
241,000) during the period under review, or an 18% in-
crease.
Tradanet has seen significant growth in the value of pay-
roll based micro-finance loans processed, which grew to
US$ 140 million (FY2011: US$ 76 million), representing an
86% increase. At the end of the period the loan book un-
der management stood at US$ 100 million (FY2011: US$ 42
million), an increase of 138% when compared to last year.
Payserv is, in cooperation with its bank clients, concluding
design and tests to upgrade the EDI Paynet product into a
real-time Electronic Fund Transfer (EFT) system. Further-
more, Payserv has been encouraged by its Zimbabwean
bank clients to explore opportunities in Zambia and is ac-
tively pursuing this.
During the twelve months under review, Payserv continued
to return increasing amounts of cash to Cambria.
The Leopard Rock Hotel is a four star hotel and
Leopard Rock Hotel (100% holding)
resort located in the Eastern Highlands of Zimbabwe.
It boasts a world-class golf course, noted as one of
the finest in Africa, a family-friendly game park, a
casino and fine restaurants offering some of the great-
est food in Zimbabwe.
(Audited US$ millions)
2012
2011
GROWTH
Revenues
Gross profit (1)
2.5
1.9
2.1
1.6
Gross margin
78%
76%
17%
20%
2%
(1) For comparison, FY2011 gross profit adjusted for re-al-
location of certain labour costs
When compared to last year, the Leopard Rock Hotel saw
occupancies of 46% (FY2011: 38%), an increase of 21%.
Average room rates decreased by 6% to US$ 111 (FY2011:
US$ 117). During the period, Revenue Per Available Room
(RevPAR) increased to US$ 51 from US$ 44, an increase of
16%.
At 31 August 2011, certain labour costs were allocated to
Page 4
‘costs of goods sold’ (COGS), which were included in Selling,
General and Administrative costs in the prior year. In line
with industry norms, these amounts have been excluded
from COSS again in FY2012 and the comparative FY2011
figures adjusted. Unadjusted, consolidated gross profit for
FY2011 was US$1.0m.
During the period under review a key issue for the Leopard
Rock Hotel, which is managed by Lonrho Hotels under a
Hotel Management Agreement, was the dramatic increase
in operating costs, which increased 31% when compared to
the equivalent period last year. This resulted in a significant
increase in the EBITDA loss for the Hotel to US$ 481,000
compared to a loss of US$ 198,000 the prior year, a 2.4x
increase, despite a revenue increase of 17% year-on-year.
Cambria has taken an active interest in resolving this issue
and has expressed serious concerns to Lonrho Hotels re-
garding the disappointing operating results. If the operat-
ing issues are not swiftly brought under control Cambria
will review various alternatives to lift performance of the
Leopard Rock Hotel.
On 14 March 2012, Cambria acquired the well-known “Cas-
tle at Leopard Rock” for EUR 0.6 million (US$ 0.7 million),
which is located adjacent to the Leopard Rock Hotel. The
Castle is located near the top of the Leopard Rock and
boasts spectacular views all around; across Zimbabwe’s
Eastern Highlands and well into Mozambique.
After significant investment by Cambria, Celsys has
Celsys (60% holding)
become, in the Company’s view, one of the best
equipped printers in Zimbabwe. As a result, it has
been able to command leading market positions in se-
curity and commercial printing.
(Audited US$ millions)
2012
2011
GROWTH
Revenues (1)
Gross profit (1)
1.8
0.6
1.1
0.2
Gross margin
32%
20%
65%
159%
57%
(1) Adjusted figures relate to continuing businesses Print and ATM
leasing only
Celsys, by focusing on its print division, has made signifi-
cant strides turning an undercapitalized, ‘sub-scale’ print-
Cambria Africa Plc Chief Executive Officer’s Statement (continued)
er into one of the industry leaders in Zimbabwe. During
the period, Celsys has been able to further consolidate the
position it now commands as one of the leading commer-
cial printers in Zimbabwe, allowing it to grow sales rapidly
while increasing margins.
Transactions processed through Celsys’ legacy ATM division
continue to grow. Transactions during the period under re-
view, which directly relate to revenue, were US$ 0.8 million
(2011: US$ 0.4 million), an increase of 100%.
Cambria does not believe the significant goodwill associ-
ated with its shareholding in Celsys reflects its true value.
The Board therefore made the decision during the first half
of financial year 2012 to write off the goodwill associated
with the shareholding in Celsys resulting in a write-off of
US$ 6.8 million.
On 8 May 2012 Cambria stated its intention to acquire the
remaining 40% of Celsys’ shares not already owned by the
Company. On 29 May 2012, Celsys’ shareholders approved
their takeover by Cambria. This process will be completed
when Cambria lists on the Zimbabwe Stock Exchange (ZSE).
Cambria announced on 31 August 2012 that its proposed
listing on the (ZSE) had been rescheduled to take place
following the publication of its audited results for the year
ended 31 August 2012. In the interim, Celsys Limited has
been suspended from trading on the ZSE, effective from 28
August 2012 and until the proposed ZSE listing of Cambria.
The Proposed ZSE Listing is a secondary listing for the Com-
pany as its primary listing will remain on the AIM market of
the London Stock Exchange, where it has been listed since
2007.
Millchem, previously trading as Millpal Chemicals, is a
Millchem (100% holding)
value-added chemicals distributor with leading mar-
ket positions in Zimbabwe in solvents, metal treat-
ment products and alkyd resins.
(Audited US$ millions)
2012
2011
GROWTH
Revenues
Gross profit
3.8
0.7
1.7
0.4
126%
93%
Gross margin
19%
22%
(15%)
The significant gross profit growth achieved by Millchem
over the period resulted from continued expansion of Mill-
chem’s core solvent business, increased diversification into
new, more specialized product lines (e.g. alkyd resins, min-
ing chemicals, other), entry into new market sectors, and
through sourcing product at much improved terms includ-
ing entry into bulk markets.
Millchem has been able to make initial sales into Zambia
(and, after the end of the period under review, Malawi),
and will continue to actively pursue regional expansion.
During the period under review Millchem became the only
African member of the National Association of Chemicals
Distributors (NACD), the U.S. industry association for value
added chemicals distributors, making it a natural partner in
the future for U.S. chemicals producers seeking distribution
in Zimbabwe.
Accelerated write-offs, net assets and
The new Board decided to take a more prudent and
non-recurring items
fully reflective view of the value of the various assets on
the Company’s balance sheet. This has resulted in signifi-
cant write-offs in Operating Losses over the course of the
year amounting to US$ 19.0 million. US$ 10.7 million of
this was already disclosed in the 1st half of 2012. The vast
majority related to intangible assets primarily concerning
the Celsys, FMNA investments and a non-compete agree-
ment with Lonrho Plc.
Other write offs incurred during the period under review
relate to airplanes which were owned by the Company
and were sold and a loan provided to a farming concern in
Zimbabwe for which the recovery is uncertain. More detail
on the situation surrounding the aircraft and the loan to
the farming concern is provided later on in this report.
During financial year 2012 there were a significant number
of costs incurred in relation to the separation from Lonrho.
In addition, discontinued operations had a significant com-
bined operating loss over the period.
In the interests of full transparency, the table below details
line by line the loss for the period, so that shareholders
and investors can fully understand where losses arose and
understand that they are predominately one-off write offs.
As a result of the Boards review, these losses were
anticipated, Cambria’s objective, as tough as some of the
Page 5
Financial Report 2012 Chief Executive Officer’s Statement (continued)
decisions were, was to have a transparent and a more
accurate balance sheet going forward.
ForgetMeNot Africa Limited (FMNA)
(51% holding)
Adjusted loss for the period
(Audited; US$ millions)
Reported loss for the period
Accelerated write offs
Churchill Estates
Airplanes
Non-compete
Celsys Goodwill
FMNA Goodwill and Intangible
Write-offs in Discontinued Operations
Receivables
Non recurring costs
Separation costs
ZSE Listing costs
Management fee
Exceptional gains
Adjusted loss for the period
2012
25.7
19.6
1.3
3.3
2.5
6.8
1.4
2.6
1.7
1.4
0.5
0.4
0.5
0.5
5.2
Following the various write-offs and operating losses, as at
31 August 2012 tangible assets of the Group were
US$ 33.0 million.
Net tangible assets exclude certain balances which are not
necessarily recoverable and have been disclosed as con-
tingent assets (US$ 8.5 million). These contingent assets
include the loan extended to Churchill Estates and claims
against Five Forty Aviation Ltd.
Aldeamento Turistico de Macuti SARL
Other and corporate overheads
(ATdM) (80% holding)
On 30 September 2011 Cambria sold its 80% stake in ATdM, a
Mozambique entity holding the rights to a significant coastal
property in Beira, Mozambique, for US$ 5.1 million payable
over 60 months, carrying 7% interest per annum. This trans-
action generated a book profit on sale of US$ 575k. As part
of the transaction the buyer also agreed to repay Cambria a
shareholder loan which was provided to ATdM. This loan will
be repaid over 24 months carrying a 7% interest per annum.
Page 6
FMNA, a moblie phone technology ventre, generated
US$1.0million (2011: US$1.1million) in operating losses
during the period under review.
Cambria could no longer be confident that any of its invest-
ment would be recovered and the board decided to write
off Cambria’s FMNA’S shareholders loans, as well as any
goodwill associated with Cambria’s shareholding in FMNA.
Cambra’s share of total write offs in the period under re-
view associated with FMNA are US$3.4million.
On August 24 2012, Cambria announced that it had signed
a Memorandum of Understanding with ForgetMeNot Soft-
ware Limited (FMN), its joint venture partner in FMNA, re-
garding the sale of its shares in FMNA to FMN. The com-
pletion of this sale was announced on February 14, 2013.
Proceeds of the sale of US$ 250k, which are payable on
achieving certain milestones or at latest 24 months from
completion of the sale, have been accounted for as a con-
tingent asset.
Diospyros Investments (Private)
Limited (t/a “CES Zimbabwe”) (CES)
(100% holding)
The provision of IT services through CES Zimbabwe was
considered a key business for Cambria. However, CES
Zimbabwe is jointly managed by Cambria and Complete
Enterprise Solutions Mauritius (CES Mauritius) through a
franchise agreement between CES Mauritius and Cambria
sharing investment, risk and profits in CES. This structure
proved unsustainable.
CES Mauritius is a regional IT services company and itself a
joint venture between Lonrho and other individual share-
holders.
On August 24, 2012, Cambria announced it had executed
agreements related to the conditional sale of its shares in
Diospyros Investments (Pvt) Ltd (Diospyros) to CES Mauri-
tius. Under this agreement, Cambria is to receive US$ 0.2
million from CES Mauritius for the shares, completion of
which is conditional on certain regulatory approvals being
obtained. As of the date of this report these regulatory
approvals had not yet been received.
Cambria Africa Plc Chief Executive Officer’s Statement (continued)
LonZim Air (B.V.I.) Limited
(100% holding)
Cambria owned two aircraft through its subsidiary LonZim
Air (B.V.I.) Limited: a Fokker F27-500 Cargo (F27) and an ATR
42-320 (ATR). The F27 was leased to 540 (Uganda) Limited
in September 2008 and the ATR was leased to Five Forty
Aviation Limited in July 2009. Both entities (collective-
ly “540”) were, or were understood to be subsidiaries of
Lonrho. A third aircraft leased by 540 was destroyed in an
accident in January 2011.
A number of disputes have arisen in relation to these air-
craft and associated contracts. These disputes relate, inter
alia, to the payment of insurance proceeds, outstanding
lease payments, maintenance reserves and the condition
of the two remaining aircraft. Cambria considers that sub-
stantial sums are due from 540. 540 contends that no sums
are due to Cambria and/or its associated companies and
that, overall, it is owed approximately US$ 0.8 million in re-
lation to the aircraft, although the basis for this claim has
not yet been set out.
Investigations by the Company during the second half
of the financial year 2012 determined the ATR and F-27,
which were kept in poor condition, were missing equip-
ment and were not airworthy. The Company subsequently
announced on 8 August 2012 it had sold the aircraft for an
aggregate sum of US$ 0.2 million to a Kenyan operator. The
price was in line with an independent third party valuation
obtained by the Company and represented as a book loss
on sale US$ 3.2 million.
In the interim, Lonrho is believed to have sold its stake in
540 to an entity now called Fastjet plc, in which Lonrho cur-
rently holds a reported 61% stake.
In summary, Cambria will pursue recovery of US$ 6.9 mil-
lion. These amounts relate to, inter alia, to maintenance
reserve and lease charges and related contractual interest,
payment of insurance proceeds, the deterioration in mar-
ket value of the aircraft, and the significantly lower amount
the Company was able to obtain through a sale, due to the
poor condition the aircraft were found to be in.
Churchill Estates loan
During 2008 Cambria, then managed by Lonrho, extend-
ed a loan to what is believed to be a Zimbabwe farming
concern, Churchill Estates (1995) Private Ltd (CE). This loan
was extended to CE as an unsecured five-year loan, at a
15% annualized interest rate with principal and interest to
be repaid at the end of the term. No financial performance
reporting is required under the terms of the loan.
Even though the Board will vigorously enforce repayment
of this loan by CE when it is due in October 2013, the Board
considered it at this point prudent to recognise impairment
of the value of this loan as well as any associated accumu-
lated interest.
The Board made this decision given the difficulty to assess
the ability of CE to repay the loan due to the absence of any
financial information on CE. Moreover, the Company and
its auditors have, due to the lack of any type of response,
been unable to verify the loan with CE. Despite this the
Board will vigorously enforce repayment of this loan by CE
when it is due in October 2013
During the first half of 2012 costs associated with the Lon-
Corporate overheads
rho Management Services Agreement relating to Cambria
were still being carried by the Company, a total of US$ 284k
was paid in the current year.
Monies paid to Lonrho in relation to this management
agreement, as well as other fees, (re-)charges and reim-
bursements paid to Lonrho during the period under review
amounted to a approximately US$500k. This amount ex-
cludes monies accrued as due to Lonrho Hotels under the
Hotel Management Agreement associated with the Leop-
ard Rock Hotel.
At the beginning of the period under review Cambria also
carried a US$ 3.8 million intangible asset associated with
a non-compete agreement with Lonrho. The Board does
not believe there is value associated with this non-compete
agreement and has therefore written this off entirely.
The vast majority, if not all of the costs, fees and other
charges related to Cambria’s prior relationship with Lonrho,
were in the opinion of Cambria’s Board no longer incurred
from the end of February 2012 onwards.
One-off expenses incurred during the period under review
associated with Cambria’s transition away from Lonhro are
approximately US$ 0.5 million. These are, amongst others,
costs associated with legal advice and professional fees.
Page 7
Financial Report 2012 shows positive indicators of significant improve-
ment over the same period last year.
The significant changes over the past financial year 2012
have laid a strong foundation for Cambria. During financial
year 2013 the Board is working hard to build on this new
foundation, increasingly moving Cambria towards sustain-
able growth and profitability.
Some legacy issues are, of course, still being dealt with by
the Board. However, increasingly, Cambria is solely focused
on looking forward and reaping the rewards of the founda-
tion built during 2012.
Moreover, the Board, cognizant of the significant difference
between net asset value and current market capitalization,
continues to review ways to narrow this discount in the
ways as described earlier in this report.
Importantly, as already indicated at the end of the CEO
report for the first half of financial year 2012, the Board
continues to confidently pursue profitability, scale and
efficiency for Cambria. Shareholders can be assured that
during the ongoing growth of the Company the Board of
Directors of Cambria has one clear objective: To relentlessly
pursue value for our shareholders’ profitability.
E d z o W i s m a n
C h i e f E x e c u t i v e O f f i c e r
2 8 F e b r u a r y 2 0 1 2
Chief Executive Officer’s Statement (continued)
Events following end of period under
Following the end of the period under review, which end-
review
ed 31 August 2012, Cambria has undertaken a number of
corporate actions:
• On 5 October 2012 the Company raised US$ 1.4
million gross by way of a placing of 8,615,115 new
ordinary par value shares of £0.0001 each at 10p
per share. The placement received support from
directors, who subscribed for 22.5% of the offering,
existing shareholders, as well as from WH Ireland,
nominated advisor and broker to the Company,
who subscribed for 23.8% of the offering.
•
On 6 December 2012 Cambria negotiated with Con-
silium Investment Management (Consilium) an ex-
tension of maturity of the first US$ 1 million tranche
of the previously mentioned US$ 3 million loan (ar-
ranged through Consilium March 2012) from 31 De-
cember 2012 to 8 March 2014.
•
On 15 February 2013 Cambria announced the com-
pletion of the sale of FMNA to FMN.
• During the first half of financial year 2013 Payserv
established a Lusaka office in December 2012,
in anticipation of entering the Zambian market.
Partnering with existing players it expects to lead
with its Payment EDI switching technology and
make available its other outsourcing products to
Zambia’s growing financial and business sector.
•
•
During the first half of financial year 2013 Payserv
invested a significant amount of capital in develop-
ing various new offerings for its Paynet product, the
first of which was launched in February 2013.
On 19 February 2013, Cambria arranged an
increase of the US$ 3 million loan with Consilium
by US$ 1.5 million, bringing the total facility to
US$ 4.5 million.
• On 19 February 2013, Cambria announced its
intent to invest in a more structured presence for
Millchem, in Zambia, including a Lusaka office and
warehouse. Various existing suppliers, encouraged
by Millchem’s rapid growth in Zimbabwe, have
already offered to extend Millchem’s Zimbabwe
agencies into Zambia.
• After a year of transition, and in line with the new
Board’s uncompromising strategy of focus and
profitability, the first half of financial year 2013
Page 8
Cambria Africa Plc Directors (continued)
Directors
Ian Perkins, 63
E x e c u t i v e C h a i r m a n
Ian Perkins has over 40 years’ London City experience. Until
1991 he was at James Capel & Co. where he was a Direc-
tor and Head of Fixed Income. Between 1991 and 1996,
Ian was Director and later Chief Executive Officer (CEO)
of listed bank King & Shaxson Holdings plc. When Gerrard
Group acquired King & Shaxson in 1996, Ian became a
Director of Gerrard Group plc and Chairman of the Gerrard
& King Bank. Following Gerrard Group’s takeover by the
Old Mutual Group in 2000, he became a Director of Old
Mutual Financial Services Plc, and the CEO and later
Chairman of GNI Limited until 2003. Thereafter until 2010,
culminating in her role as European IS Manager. Tania is a
Chartered Accountant and holds a Bachelor of Commerce
(Accounting) from University of Cape Town and a Post
Graduate Diploma in Accounting from the University of
South Africa. Appointed 3 April 2012.
Paul Turner, 66
N o n - E x e c u t i v e D i r e c t o r a n d D e p u t y
C h a i r m a n
Paul Turner is a Chartered Accountant and past President
of the Institute of Chartered Accountants of Zimbabwe. He
is a highly respected and knowledgeable member of the
Zimbabwean business community. He was a partner at Ernst
& Young in Harare, Zimbabwe, for over thirty years and brings
an unparalleled level of experience in the structure and
operation of businesses in Zimbabwe. Appointed 1 July
Ian was Chairman of fixed income and inter-dealer broking
2008.
firm King & Shaxson Limited. Appointed 24 February 2012.
Edzo Wisman, 39
C h i e f E x e c u t i v e O f f i c e r
Prior to joining the Company in 2010, Edzo Wisman was
Managing Director of Stuart Lammert & Co., a Toronto
and New York based corporate advisory firm that he
founded in 2003. Prior to that, Edzo was a Vice President;
Investment Banking with Toronto based CCFL Advisory
Services. Previously, he was with Wilshire Associates;
first with the consultancy practice in Amsterdam, servic-
ing some of Europe’s largest institutional investors; and
then with the Private Markets Group at Wilshire’s Santa
Monica, California headquarters, seeking opportunities in
the leveraged buyout markets. Edzo has also worked with
the investment department of the pension funds of KLM
Royal Dutch Airlines. He holds a Doctorandus degree in
Business Economics from the University of Groningen. He
has published a number of papers on the buyout markets
and corporate governance issues. Appointed 24 February
2012.
Tania Sanders, 40
D i r e c t o r a n d C h i e f F i n a n c i a l O f f i c e r
Tania Sanders previously held increasingly senior roles
within finance and IT with Anheuser-Busch Europe Ltd.,
Itai Mazaiwana, 52
N o n - E x e c u t i v e D i r e c t o r
Itai Mazaiwana started his career in research and educa-
tion at the Institute of Mining Research at the University of
Zimbabwe as an Analytical Geochemist. During his
subsequent career in the private sector, Itai held senior
positions in the mining and chemicals industries at ZIS-
CO Steel, Anacal Laboratory, Ardington Exploration, and
Polokwane Chemicals (South Africa). Itai is currently a direc-
tor of Jeune Zimbabwe, Mining and Infrastructure Develop-
ment Corporation, a joint venture between Jeune and the
Government of Zimbabwe
and Pan-African Energy
Resources, a consortium of European and Zimbabwean
engineers and scientists developing a 2000MW power
station. In recent years, Itai has acted as a technical advis-
er to Orange Advisory Alliance (South Africa), Lineband/
Scores Mining, and New Frontier Partners Zimbabwe.
The latter organisation promotes local participation in
Zimbabwe’s mining and energy sectors. Itai holds a BSc in
Chemistry and Geology and a MSc in Analytical Chemistry,
both from the University of Zimbabwe. He has published a
number of papers on low level detection of gold. Appoint-
ed 24 February 2012.
Page 9
Financial Report 2012 Directors (continued)
Fred Jones, 43
N o n - E x e c u t i v e D i r e c t o r
Fred Jones is the Chairman of Jutland Group; a private
Hong Kong based investment management and commod-
ity firm which he founded in 2006 to manage portfolios of
foreign exchange, precious metals and international debt.
Fred also founded Jaramcor International, a commodity
supply-chain manager and supplier of pulp/paper, chem-
icals and agricultural products. He was previously Vice
President, Private Client Services, at Bear Stearns Global
Wealth Management. Fred was also with the International
Private Client Group of Merrill Lynch. He holds a BSc in Ac-
countancy and an MBA in Finance from Florida A&M Uni-
versity. Appointed 24 February 2012.
Paul Heber*, 49
N o n - E x e c u t i v e D i r e c t o r
Paul Heber is an investment manager and stockbroker with
more than 20 years experience in global stock markets, fol-
lowing 3 years in the oil industry and formerly with bespoke
boutique Savoy Investment Management SGHambros, Nat
West and WI Carr, Paul has a broad pan-African clientele along-
side his domestic UK, European and Bermudan businesses.
Paul is also a Non-Executive Director of Shanta Gold Plc.
* Paul Heber resigned as a Director on 10 December 2012
The following Directors resigned during the
period under review
Director
Colin Orr-Ewing Non - Executive
Director
David Lenigas
Executive Chairman
Geoffrey White
Director and Chief
Executive Officer
David Armstrong Finance Director
Emma Priestley
Executive Director
Jean Ellis
Non-Executive
Director
Date of
resignation
31 October
2011
24 February
2012
24 February
2012
24 February
2012
24 February
2012
24 February
2012
Page 10
Directors’ Responsi-
bility Statement in
Respect of the Direc-
tors’ Report and the
Finanical Satatments.
The Directors are responsible for preparing the Directors’
Report and the financial statements in accordance with
applicable law and regulations. In addition, the Directors
have elected to prepare the Group and Parent Compa-
ny financial statements in accordance with International
Financial Reporting Standards.
The Group and Parent Company financial statements are
required to give a true and fair view of the state of affairs of
the Group and Parent Company and of the profit or loss of
the Group for that period.
In preparing these financial statements, the Directors
are required to:
•
•
•
•
select suitable accounting policies and then apply
them consistently;
make judgements and estimates that are reason-
able and prudent;
state whether they have been prepared in accor-
dance with International Financial Reporting Stan-
dards; and
prepare the financial statements on the going con-
cern basis unless it is inappropriate to presume
that the Group and Parent Company will continue
in business.
The Directors are responsible for keeping proper account-
ing records that are sufficient to show and explain the
Parent Company’s transactions and disclose with reason-
able accuracy at any time its financial position. They have
general responsibility for taking such steps as are reason-
ably open to them to safeguard the assets of the Group and
to prevent and detect fraud and other irregularities.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information includ-
ed on the Company’s website. Legislation governing the
preparation and dissemination of financial statements may
differ from one jurisdiction to another.
Cambria Africa Plc F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
Directors’ Report
The Directors of Cambria Africa Plc (formerly Lonzim Plc)
(the “Company”) and its subsidiaries (together the “Group”)
submit their report, together with the audited financial
pany has an established management team in Zimbabwe
statements for the year ended 31 August 2012.
During the year, the Group was an investment company
Principal activities
with a portfolio of investments in Zimbabwe.
seek to achieve Board control or financial control of its
businesses acquired. Wherever possible the Company will
to provide local day to day management of companies and
The Company’s investment objective is to provide Share-
Investment Strategy
holders with long term capital appreciation through the
portfolio companies. Indigenization legislation within Zim-
babwe may, however, prevent the Company from acquiring
majority shareholder control in Zimbabwean businesses.
The Directors believe that through their individual and
investment of its capital primarily in Zimbabwe and, if ap-
collective experience of investing and managing acquisi-
propriate, the region of Mozambique known as the Beira
tions and disposals in Africa, they have the necessary skills
Corridor, which links Zimbabwe to the coast. While the
to manage the Company and to source deal flow. Prior to
Company does not have a particular sectoral focus, utilising
any investment decisions being taken by the Board of the
the investment skills of the Directors and their advisors, the
Company, a thorough due diligence process is undertaken
Company seeks to identify individual companies in sectors
by the Company’s appointed specialist financial and legal
best positioned to benefit should there be radical improve-
advisors.
ments in Zimbabwe’s economy. The Company may make
investments in the tourism, accommodation, infrastruc-
ture, transport, commercial and residential property, tech-
nology, communications, manufacturing, retail, services,
leisure, agricultural and natural resources sectors. The
Company may also make investments in businesses out-
side Zimbabwe that have a significant exposure to assets,
businesses or operations within Zimbabwe. The Company
The Company’s investment strategy is dependent upon
future radical improvement in the Zimbabwean economy,
and it is therefore possible that a significant period of time
may elapse before an investment by the Company will pro-
duce any returns. However, there is no guarantee that the
economy in Zimbabwe will improve. Accordingly, the Com-
pany may not be able to make any profits and may incur
will only be able to achieve its investment objective in the
losses.
event the Zimbabwean economy radically improves.
Whilst there will not be any limit on the number or size of
investments the Company can make in any sector, the Di-
rectors seek to diversify the Company’s investments across
various sectors in order to mitigate risk and to avoid con-
centrating the portfolio in any single sector.
The Company’s interest in a proposed investment or acqui-
sition may range from a minority position to full ownership.
The Company intends, in any event, to actively manage the
operations of the companies it has invested in. The Com-
The Directors intend to seek the consent of the Sharehold-
ers for the investment policy on an annual basis. The Com-
pany, Directors will comply as a matter of policy with the US
Office of Foreign Assets Control and the European Union
Council Regulation (EC) No. 314/2004 regulations.
The Group made a consolidated loss after non-controlling in-
Results
terests of US$27,271 thousand (2011: loss US$9,195 thousand)
during the year and this has been transferred to reserves.
Page 11
Financial Report 2012 Directors’ Report (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
On 16 September 2011, the Company announced that it
Share capital
had raised £917 thousand by way of a placing of 3,988,439
new ordinary shares at 23p per share, resulting in the is-
sued share capital of the Company being increased to
58,133,908 ordinary shares.
Post year end, on 1 October 2012, the Company announced
the placing of 8,615,115 new ordinary shares at 10p per
share, resulting in the issued share capital of the Company
being increased to 66,749,023.
investment that is made and have therefore developed a
risk analysis reporting procedure, which links into the Com-
pany’s Corporate Governance procedures.
Further information regarding the Group’s policies and ex-
posure to financial risk can be found in note 30 to the finan-
cial statements.
Details of significant events since the reporting date are
Post balance sheet events
contained in note 37 to the financial statements.
The Chief Executive’s review of operations contains infor-
Business review and development
mation on developments during the year and key potential
future developments.
The requirements of the enhanced business review in rela-
tion to strategy and progress thereon are contained in the
Chief Executive’s review of operations. The principal risks
and uncertainties relate to the revenue generation in the
Group’s businesses which, being located in Africa, are sub-
ject to respective government policies, political stability,
general economic conditions in the relevant country and
exposure to foreign currency movements.
The Group monitors cash flow as its primary key perfor-
mance indicator. Given current global financial conditions,
as well as current developments in Zimbabwe, the Direc-
tors are carefully monitoring cash resources within the
The Directors do not recommend the payment of a divi-
Dividends
dend (2011: US$nil).
Compliance with the UK Corporate
Corporate Governance
Governance Code
The Directors recognise the value of the UK Corporate Gov-
ernance Code (formerly the Combined Code on Corporate
Governance) and, whilst under AIM rules full compliance
is not required, the Directors have considered the recom-
mendations and applicability in respect of the Company in-
sofar as is practicable and appropriate for a public company
of its size.
Board of Directors
Group and have instigated a number of initiatives to en-
Mr Colin Orr-Ewing resigned as a director on 31 October
sure funding will be available to meet obligations as they
2011. At the last Annual General Meeting held February 24,
fall due and for planned projects. If such funding cannot be
2012, David Lenigas, Geoffrey White, David Armstrong and
secured, the projects will be delayed or cancelled to ensure
Jean Ellis resigned. Ms Emma Priestley resigned by rotation
that the Group can manage its cash resources for the fore-
and was not re-appointed. Following the Annual General
seeable future and hence the financial statements have
meeting the Board of Directors comprised of an Executive
been prepared on a going concern basis. The Group also
Director, and four Non-Executive Directors, one of whom is
uses a number of other key performance indicators which
the Chairman. Ms Tania Sanders subsequently joined the
are measured at different tiers in the operation. At the top
Board as an Executive Director on 3 April 2012. Mr Paul
level, the Group tracks revenues, gross profit, EBITDA, cash
Heber resigned as a Director on 10 December 2012.
generation and performance against budget.
The Directors mitigate risk by proper evaluation of every
es a suitable balance to enable the recommendations of
The Directors are of the opinion that the Board compris-
Page 12
Cambria Africa Plc Directors’ Report (continued)
Corporate Governance (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
the Code to be implemented to an appropriate level. The
larities will be detected or that the risk of failure to achieve
Board, through the Chairman and Chief Executive Officer in
business objectives is eliminated.
particular, maintains regular contact with its advisors, and
institutional investors in order to ensure that the Board de-
velops an understanding of the views of the major share-
holders of the Company.
The Board meets quarterly and is responsible for formu-
lating, reviewing and approving the Company’s strategy,
financial activities and operating performance. Day to day
management is devolved to the executive management
who are charged with consulting the Board on all signifi-
cant financial and operational matters. Consequently, de-
cisions are made promptly following consultation amongst
the Directors and managers concerned, where necessary
and appropriate.
All necessary information is supplied to the Directors on a
timely basis to enable them to discharge their duties ef-
fectively and all Directors have access to independent pro-
fessional advice at the Company’s expense, as and when
required.
The Chairman is available to meet with institutional share-
holders to discuss any issues and concerns regarding the
Group’s governance. The Non-Executive Directors can also
attend meetings with major shareholders, if requested.
The participation of both private and institutional investors
at the Annual General Meeting is welcomed by the Board.
Internal controls
The Directors acknowledge their responsibility for the
Company’s and the Group’s systems of internal control,
which are designed to safeguard the assets of the Group
and ensure the reliability of financial information for both
internal use and external publication. Overall control is en-
sured by a regular detailed reporting system covering the
state of the Group’s financial affairs. The Board has devel-
oped procedures for identifying, evaluating and managing
the significant risks that face the Group, which will be im-
plemented in the coming months.
Any system of internal control can provide only reasonable,
and not absolute, assurance that material financial irregu-
Committees
The Board has devolved duties to the following commit-
tees:
Audit Committee
The role of the Audit Committee is to oversee the nature
and scope of the annual audit, management’s reporting
on internal accounting standards and practices, financial
information and accounting systems and procedures and
the Company’s financial reporting statements. The Audit
Committee’s primary objectives include assisting the Di-
rectors in meeting their responsibilities in respect of the
Company’s continuous financial disclosure obligations and
overseeing the work of the Company’s external auditors.
Following the Annual General Meeting, the Audit Commit-
tee comprises Paul Turner (Chairman), Ian Perkins and Fred
Jones.
Remuneration Committee
The Remuneration Committee makes recommendations to
the Board on the remuneration policy that applies to Exec-
utive Directors and senior employees. Prior to 24 February
2012, the members of the Remuneration Committee were
Paul Heber (Chairman), Paul Turner and Colin Orr-Ewing.
Subsequent to Colin Orr-Ewing’s resignation on 31 October
2011, the Remuneration Committee comprised Paul Heber
(Chairman) and Paul Turner.
Subsequent to the appointment of new Directors on 24
February 2012, the Remuneration Committee comprised
Ian Perkins (Chairman), Paul Heber and Fred Jones. Sub-
sequent to the resignation of Paul Heber, Paul Turner was
re-appointed to the Remuneration Committee.
Nomination Committee
The Nomination Committee is responsible for identifying
candidates to fill vacancies on the Board, as and when
they arise, and nominate them for approval by the Board.
Page 13
Financial Report 2012 Directors’ Report (continued)
Corporate Governance (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
Committees (continued)
Prior to 24 February 2012, the Nomination Committee
comprised Paul Heber (Chairman), Paul Turner and Geof-
frey White. Following the Annual General Meeting, the
Nomination Committee comprises Paul Turner (Chairman),
The Directors’ interests in the shares of the Company at the
Directors’ share interests
beginning and end of the year were as follows:
Edzo Wisman and Itai Mazaiwana.
Corporate Governance Committee
At 25.02.13
No. of
shares
At 31.08.12
No. of
shares
At 31.08.11
No. of
shares
Directors
The Corporate Governance Committee is responsible for
Ian Perkins
880,250
265,000
ensuring proper corporate governance of the Company and
is authorised by the Board to undertake regular reviews of
external issues which have the potential for serious impact
on the Company’s business, and to have the oversight of
social, environmental and reputational management of the
Company. At 24 February 2012, the Terms Reference of the
Nill
Nill
Nill
Fred Jones
615,250
Edzo Wisman
615,250
Nill
Nil
Paul Heber *
350,00
350,000
176,946
Tania Sanders
92,280
Nill
Nil
Nill
Nill
committee were accepted and Edzo Wisman (Chairman),
Paul Turner
Nil
Fred Jones and Paul Heber were appointed to the commit-
tee. Itai Mazaiwana was appointed subsequent to Paul He-
ber’s resignation.
The Directors have been advised of the following share-
Declared substantial shareholdings
holdings at 27 February 2013 in 3 per cent or more of the
Company’s issued share capital:
Share options held by the Directors are detailed in note 23
of the financial statements
All of the above interests are recorded in the Company’s
Register of Directors’ Share and Debenture Interests. No Di-
rector has a beneficial interest in the shares or debentures
of any of the Company’s subsidiary undertakings.
The following Directors participated in the share placement
Percentage
on 1 October 2012 for the following number of shares.
Number of
of the issued
shares
14,252,663
captial
21.35%
10,102,352
15.13%
6,159,132
9.23%
4,860,000
7.28%
Russell Investments
Ltd
Jutland Capital
Management Ltd
Consilium Emerging
Market Absolute
Return Masters Fund
Ltd
Contrarian Capital
Management
Biographical details of all Directors as well date of appoint-
Directors
ment and resignation are set out on pages 11 and 12.
Page 14
Ian Perkins
Fred Jones
Edzo Wisman
Tania Sanders
Total
615,250
615,250
615,250
92,280
1,938,030
* Paul Heber resigned as a Director on 10 December 2012
The Company has in place an Anti-Corruption and Bribery
Anti-Corruption and Bribery Policy
Policy which has been adopted by the Company across all
divisions of the Group. The Board has overall responsibility
for ensuring compliance by Directors, employees and oth-
er persons associated with the Group with applicable legal
and ethical obligations. The Company’s Finance Director
has primary and day-to-day responsibility for implementa-
tion of the policy. Management at all levels of the Group
Cambria Africa Plc Directors’ Report (continued)
Anti-Corruption and Bribery Policy (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
are responsible for ensuring those reporting to them are
aware, there is no relevant audit information of which the
made aware of, and understand, the policy. The policy gives
Company’s Auditors are unaware; and each Director has
guidance on risk identification and the procedures to fol-
taken all the steps that he/she ought to have taken as a Di-
low where a risk is identified, together with clear guidelines
rector to make himself/herself aware of any relevant audit
on gifts, entertainment and donations.
information and to establish that the Company’s Auditors
are aware of that information.
The Company has Directors’ and Officers’ liability insurance
Insurance
cover in place for Group Directors.
The notice of meeting, together with a form of proxy, will
Annual General Meeting
be sent out separately at a later date.
Between 1 September 2011 and 31 August 2012 the share
Share price performance
price varied between a high of 18.5p and a low of 9.60p. At
31 August 2012 the mid-market price of the shares at close
of business was 9.90p (2011: 21.5p). At 27 February 2013
the mid-market price of the shares was 9.63p.
On behalf of the Board.
Paul Turner
Deputy Chairman
28 February 2013
The Group does not follow any code or standard with re-
Payment to suppliers
gard to the payment of its suppliers. The Group’s policy is
to agree terms and conditions with suppliers in advance;
payment is then made in accordance with the agreement
provided the supplier has met the terms and conditions.
Amounts due to suppliers at the reporting date are con-
tained in note 28.
On 11 November 2011, the Directors announced their de-
Change in reporting currency
cision to report the results of the Company in US Dollars
in order to give a clearer understanding of the Company’s
performance, reflecting the profile of the Group’s revenue
and results, which are primarily in US Dollars. The change
became effective from 1 September 2011.
A resolution to re-appoint KPMG Audit LLC and to autho-
Auditors
rise the Directors to fix their remuneration will be proposed
at the Annual General Meeting.
The Directors who held office at the date of approval of
this Directors’ Report confirm that, so far as they are each
Page 15
Financial Report 2012 Report of the Independent Auditors, KPMG Audit LLC, to
We have audited the Group and Parent Company financial
the members of Cambria Africa Plc
statements (the “financial statements”) of Cambria Africa
Plc for the year ended 31 August 2012 which comprise the
closed; the reasonableness of significant accounting esti-
mates made by the Directors; and the overall presentation
of the financial statements.
Consolidated Income Statement, the Consolidated State-
ment of Comprehensive Income, the Consolidated State-
ment of Changes in Equity, the Consolidated and Company
Statements of Financial Position, the Consolidated State-
ment of Cash Flows and the related notes. The financial
reporting framework that has been applied in their prepa-
ration is applicable law and International Financial Report-
ing Standards (IFRSs).
In our opinion the financial statements:
Opinion on the financial statements
•
give a true and fair view of the state of the Group
and Parent Company’s affairs as at 31 August 2012
and of the Group’s loss for the year then ended;
and
This report is made solely to the Company’s members, as
•
have been properly prepared in accordance with
a body. Our audit work has been undertaken so that we
IFRSs.
might state to the Company’s members those matters we
are required to state to them in an auditor’s report and for
KPMG Audit LLC
no other purpose. To the fullest extent permitted by law,
Chartered Accountants
we do not accept or assume responsibility to anyone other
than the Company and the Company’s members as a body,
for our audit work, for this report, or for the opinions we
have formed.
Heritage Court
41 Athol Street
Douglas
Isle of Man
IM99 1H
28 February 2013
Respective responsibilities of
As explained more fully in the Directors’ Responsibilities
Directors and Auditor
Statement set out on page 12, the Directors are responsible
for the preparation of financial statements that give a true
and fair view. Our responsibility is to audit, and express
an opinion on, the financial statements in accordance with
applicable law and International Standards on Auditing (UK
and Ireland). Those standards require us to comply with
the Auditing Practices Board’s (APB’s) Ethical Standards for
Auditors.
Scope of the audit of the financial
An audit involves obtaining evidence about the amounts
statements
and disclosures in the financial statements sufficient to give
reasonable assurance that the financial statements are free
from material misstatement, whether caused by fraud or
error. This includes an assessment of: whether the account-
ing policies are appropriate to the Group’s circumstances
and have been consistently applied and adequately dis-
Page 16
Cambria Africa Plc Consolidated Income Statement
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
Revenue
Cost of Sales
Gross Profit
Operating Costs
Accelerated Write-off of Intangibles and Goodwill Impairment
Net Losess on disposal on Investments and Impairment of Assets
Results from operating activities before net finance costs
Finance Income
Finance costs
Net Finance Income
Loss Before Tax
Income Tax
Loss for the Period from Continuing Operations
Discontinued Operations
Loss for the year from discontinued operations
Loss for the year
Attributable To:
Owners of the Company
Non-controlling Interests
Loss for the year
Earnings per share
Basic and diluted loss per share (Cents)
Earnings per share-continuing operations
Basic and diluted loss per share (Cents)
2012
Total
US$’000
11,988
(5,200)
6,788
(13,158)
(10,618)
(1,621)
(18,609)
312
(674)
(362)
(18,971)
(496)
(19,467)
(6221)
(25,688)
(27,271)
1,583
(25,688)
(47.1c)
(36.6c)
*Restated
2011
Total
US$’000
8,077
(3,397)
4,680
(13,071)
(288)
-
(8,679)
299
(963)
(664)
(9,343)
(69)
(9,274)
(901)
(10,175)
(9,195)
(980)
(10,175)
(19.1c)
(17.4c)
Note
4
5
5
13,14
16
7
7
8
9
10
10
The notes on pages 25 to 76 are an integral part of these consolidated financial statements.
*Amounts have been restated due to a change in presentational currency from Pounds Sterling to United States
Dollars (see note 2).
Page 17
Financial Report 2012 Consolidated Statement of Comprehensive Income
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
Loss for the year
Other comprehensive income
Foreign currency translation differences for overseas operations
Deferred tax adjustment
Revaluation of property, plant and
equipment
Total comprehensive loss for the year
Attributable to:
Owners of the company
Non-controlling interest
Total comprehensive loss for the year
2012
US$’000
(25,688)
(1,601)
(2,839)
273
(29,855)
(28,562)
(1,293)
(29,855)
*Restated 2011
US$’000
(10,175)
(170)
-
2,122
(8,223)
(7,326)
(897)
(8,223)
The notes on pages 25 to 76 are an integral part of these consolidated financial statements.
*Amounts have been restated due to a change in presentational currency from Pounds Sterling to United States
Dollars (see note 2).
Page 18
Cambria Africa Plc Consolidated Statement of Changes in Equity
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
Share
Capital
Share
premium
Attributable to owners of the Company
Re-
Retained
valuation
earnings
reserve
Foreign
exchange
reserve
Share
based
payment
reserve
NDR
Total
Non-con-
troling
intrests
Total
Equity
Balance at 31
August 2011
Loss for the year
Revaluation of
property
Deferred tax
adjustment
Foreign currency
translation differ-
ences for overseas
operations
Total comprehensive
loss for the year
Contributions by
and distributions to
owners of the Com-
pany recognised
directly in equity
Reclassification of
reserves
Dividends paid
Issue of ordinary
shares
Share based
payment transaction
Total contributions
by and distributions
to owners of the
Company
Balance at 31
August 2012
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000 US$’000
10
75,854
6,327
(12,276)
270
(20,676)
3,044
52,553
(492)
(52,061)
-
-
-
-
-
-
-
1
-
1
-
-
-
-
-
-
-
1,545
-
-
273
(2,839)
-
-
-
(349)
1,626
(2,960)
1,626
(243)
21
-
-
-
-
-
-
-
-
-
-
-
-
-
-
85
(27,271)
-
-
(2,833)
(30,104)
-
-
-
-
-
(27,271)
1,583
(25,688)
273
(2,839)
(1,601)
-
-
-
273
(2,839)
(1,601)
(31,438)
1,583
(29,855)
3,468
(916)
2,330
(2,330)
-
-
-
-
-
-
-
-
(546)
(546)
1,546
85
-
-
1546
85
1,545
(243)
21
85
3,468
(916)
3,961
(2,876)
1,085
11
77,399
3,124
(10,629)
355
(47,312)
2,128
25,076
(1,785)
23,291
The notes on pages 25 to 76 are an integral part of these consolidated financial statements.
*Amounts have been restated due to a change in presentational currency from Pounds Sterling to United States
Dollars (see note 2).
Page 19
Financial Report 2012
Consolidated Statement of Changes in Equity
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 1
Share
Capital
Share
premium
Attributable to owners of the Company
Re-
valuation
reserve
Foreign
exchange
reserve
Retained
earnings
Share
based
payment
reserve
NDR
Total
Non-con-
troling
intrests
Total
Equity
Balance at 31
August 2010
Loss for the year
Total other compre-
hensive income
Contributions by
and distributions to
owners of the Com-
pany recognised
directly in equity
Issue of ordinary
shares
Share based
payment transaction
Total contributions
by and distributions
to owners of the
Company
Balance at 31
August 2011
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000
US$’000 US$’000
8
-
-
2
-
2
68,208
4,205
(12,023)
270
(11,481)
3,044
52,231
405
(52,636)
-
-
-
-
2,122
(253)
7,646
-
7,646
-
-
-
-
-
-
-
-
-
-
-
(9,195)
-
-
-
-
-
-
-
-
-
(9,195)
(980)
(10,175)
1,869
83
1,952
7,648
-
7,648
-
-
-
7,648
-
7,648
10
75,854
6,327
(12,276)
270
(20,676)
3,044
52,227
(492)
51,735
All amounts have been restated due to a change in presentational currency from Pounds Sterling to United
States Dollars (see note 2).
The notes on pages 25 to 76 are an integral part of these consolidated financial statements.
Page 20
Cambria Africa Plc
Consolidated and Company Statement of Financial Position
A s a t 3 1 A u g u s t 2 0 1 2
Company 2012
Company 2011
Group 2012
Group 2011
Notes
•Restated
•Restated
US$’000
US$’000
US$’000
US$’000
Assets
Property, plant and equipment
Biological Assets
Goodwill
Intangible assets
Longterm Receivables
Investment in subsidiaries
Deferred tax assets
Total Non-Current Assets
Inventories
Other Investments
Trade and other receivables
Cash and cash equivalents
Assets held for sale
Total Current Assets
Total Assets
Equity
Issued share capital
Share premium account
Revaluation reserve
11
12
13
14
15
16
26
17
18
19
20
9
21,22
21,22
21,22
Share based payment reserve
21,22,23
Foreign exchange reserve
Non distributable reserves
Retained losses
Equity Attributable to Owners of Company
Non Controlling Interests
Total Equity
Liabilities
Loans and borrowing
Provisions
Deferred Tax liabilities
Total Non-Current Liabilities
Bank overdraft
Current tax liabilities
Loans and borrowings
Trade and other payables
Liabilities held for sale
Total Current Liabilities
Total Liabilities
Total Equity and Liabilities
21
21
21
21
24
25
26
20
27
28
9
25,250
83
717
1,551
3,229
-
-
30,830
936
42
2,625
468
361
4,432
35,262
11
77,399
3,124
355
(10,629)
2,128
(47,312)
25,076
(1,785)
23,291
2,054
161
4,108
6,323
337
284
1,692
2,825
510
5,648
11,971
35,262
97
-
-
-
3,229
-
-
3,326
-
-
24,668
178
24,846
28,172
11
77,399
-
355
(13,186)
-
(40,907)
23,672
-
23,672
2,000
-
-
2,000
-
-
1,250
1,250
-
2,500
4,500
28,172
32,694
82
8,080
6,825
-
-
1,305
48,986
732
109
4,514
1,076
3,451
9,882
58,868
10
75,854
6,327
270
(12,276)
3,044
(20,676)
52,553
(492)
52,061
-
1,050
1,269
2,319
47
262
1,500
2,679
-
4,488
6,807
58,868
136
-
-
3,792
-
4,418
-
8,346
-
-
38,712
597
39,309
47,655
10
75,854
-
270
(13,101)
-
(18,320)
44,713
-
44,713
-
1,050
-
1,050
-
57
1,500
335
-
1,892
2,942
47,655
*Amounts have been restated due to a change in presentational currency from Pounds Sterling to United States Dollars (see note 2)
The notes on pages 25 to 76 are an integral part of these consolidated financial statements. These financial statements were approved by the Board of Directors and
authorised for issue on 28 February 2013. They were signed on their behalf by: E Wisman Director & Chief Executive Officer
Page 21
Financial Report 2012 Consolidated and Company Statement of cash flows
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
•Restated
Notes
Group 2012
Group 2011
Cash Flows from Operating Activites
(Increase in inventories
Decrease/(increase) in cash due from customers
(Decrease)/increase in cash due to suppliers
Cash Used in Operations
Interest Paid
Interest Received
Dividends Paid
Tax Paid
Net Cash Used in Operating Activities
Cash Flows from Investing Activities
Proceeds on disposal of property, plant and equipment
Purchase of property, plant and equipment
Purchase of intangibles
Proceeds from sale of investments
Write down of investments
Net Cash used Investing Activities
Cash Flows from Financing Activities
Proceeds from issue of share capital
Transaction costs of issue of shares
Proceeds from/(repayment of) loans
Net Cash from Financing Activities
Net (decrease) / increase in cash and cash equivalents
Cash and cash equivalents at 1 September
Foreign exchange movements
Net Cash and Cash Equivalents at 31 August
Cash and cash qwuivalents as above comprise the following:
Cash and cash equivalents
Bank overdarft
Net Cash and Cash Equivalents at 31 August
29
29
29
29
29
29
11
14
16
21
21
US$’000
(5,908)
(204)
(1,751)
(71)
(7,934)
(707)
326
(323)
(509)
(9,147)
-
312
(1,473)
-
1,197
4,418
4,454
1,546
-
2,249
3,795
(898)
1,029
-
313
468
(337)
131
US$’000
(5,441)
(260)
265
(240)
(5,676)
(241)
300
-
-
(5,617)
1,108
(1,655)
(1,082)
142
(61)
(1,548)
7,875
(226)
(75)
7,574
409
451
169
1,029
1,029
(47)
1,029
The notes on pages 25 to 76 are an integral part of these consolidated financial statements.
*Amounts have been restated due to a change in presentational currency from Pounds Sterling to United States
Dollars (see note 2)
Page 22
Cambria Africa Plc Notes to the Financial Statements
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
United State Dollars at a weighted average rate of ex-
Cambria Africa Plc (the “Company”) is a public limited
1. Reporting entity
company incorporated in the Isle of Man under the Com-
panies Act 2006. The consolidated financial statements of
the Group for the year ended 31 August 2012 comprise the
Company and its subsidiaries (together referred to as the
“Group” and individually as “Group entities”).
change. Differences resulting from the retranslation
of the opening net assets and the results for the year
have been taken to reserves;
• share capital, share premium and other reserves were
translated at the historic rates prevailing at the dates
of transactions; and
The financial statements were authorised for issue by the
Directors on 28 February 2013.
• all exchange rates used were extracted from the
Group’s underlying financial records.
Basis of measurement
Statement of compliance
2. Basis of preparation
The consolidated financial statements have been prepared
on the historical cost basis except for the following:
The consolidated financial statements have been prepared
in accordance with International Financial Reporting Stan-
dards (IFRSs) as adopted by the E.U. On publishing the Com-
pany statement of financial position here together with the
Group financial statements, the Company complies with
the Isle of Man Companies Act 2006 under which there is
no requirement to present a company statement of com-
•
•
•
aircraft measured at fair value;
biological assets and measured at fair value less
cost to sell; and
land, buildings and plant and equipment are mea-
sured at revalued amounts.
prehensive income in consolidated financial statements.
Use of estimates and judgements
Functional and presentation currency
The consolidated financial statements are presented in
United States Dollars, which, with effect from 1 September
2011, is the Company’s functional currency. The change in
presentational currency is to better reflect the Groups busi-
ness activities as cash flows and economic returns are now
principally denominated in United States Dollars.
A change in presentation currency is a change in account-
ing policy, accordingly is accounted for retrospectively. The
financial information included within the consolidated fi-
nancial statements of the Group for the year ended 31 Au-
gust 2011 was previously reported in Pounds Sterling and
has been restated into United States Dollars using the pro-
cedures outlined below:
• assets and liabilities denominated in non-United
States Dollar currencies were translated into United
States Dollars at closing rates of exchange. Non-Unit-
ed States Dollar trading results were translated into
The preparation of financial statements in conformity with
IFRSs requires management to make judgements, esti-
mates and assumptions that affect the application of poli-
cies and reported amounts of assets and liabilities, income
and expenses. The estimates and associated assumptions
are based on historical experience and various other fac-
tors that are believed to be reasonable under the circum-
stances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities
that are not readily apparent from other sources. Actual
results may differ from these estimates.
The estimates and underlying assumptions are reviewed
on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised
if the revision affects only that period, or in the period of
the revision and future periods if the revision affects both
current and future periods.
Page 23
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
2. Basis of preparation (continued)
Use of estimates and judgements (continued)
Information about critical judgements in applying account-
Disclosures – Transfers of Financial Assets
(Amendments to IFRS 7)
The amendments to IFRS 7 have been adopted by the Com-
pany for the first time for its financial reporting year ended
ing policies and assumptions and estimation uncertainties
31 August 2012.
that have the most significant effect on the amounts rec-
ognised in the consolidated financial statements is included
In terms of the amendments, additional disclosure needs
in the following notes:
Note 12 – Biological assets
Note 13 – Goodwill
Note 11 – Property Plant and equipment
to be provided regarding transfers of financial assets that
are
• not de-recognised in their entirety; and
• de-recognised in their entirety but for which the
Company retains continuing involvement.
Note 25 – Provisions
The above amendment has not resulted in any additional
By their nature, these estimates and assumptions are sub-
ject to an inherent measurement of uncertainty and the
effect on the Group’s financial statements of changes in es-
timates in future periods could be significant.
Going concern
The Group’s business activities and financial performance
are set out in the Chief Executive’s Review on pages 4 to
10. In addition, note 30 to the financial statements includes
the Group’s objectives, policies and processes for managing
its capital; its financial risk management objectives; details
of its financial instruments, and its exposure to credit and
liquidity risk.
Group has access to sufficient financial resources for its
needs. As a consequence, the Directors believe that the
Group is well placed to manage its business risks success-
fully despite the current economic outlook.
After making enquiries, the Directors have a reasonable
expectation that the Company and the Group have ade-
quate resources to continue in operational existence for
the foreseeable future. Accordingly, they continue to adopt
the going concern basis in preparing the annual report and
financial statements.
Changes in accounting policies
Page 24
disclosures.
Deferred tax: Recovery of Underlying Assets
(Amendments to IAS 12)
The amendments to IAS 12 have been adopted by the Com-
pany for the first time for its financial reporting year ended
31 August 2012.
The amendment introduces an exception to the general
measurement requirements of IAS 12 Income Taxes in re-
spect of investment properties measured at fair value. The
measurement of deferred tax assets and liabilities, in this
limited circumstance, is based on a rebuttable presumption
that the carrying amount of the investment property will
be recovered entirely through sale. The presumption can
be rebutted only if the investment property is depreciable
and held within a business model whose objective is to
consume substantially all of the asset’s economic benefits
over the life of the asset.
The above amendment has not resulted in any additional
disclosures.
The following accounting policies have been applied con-
3. Significant accounting policies
sistently by Group.
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
that are classified as held for sale in accordance with IFRS 5,
which are recognised and measured at fair value less costs
to sell.
( a ) B a s i s o f c o n s o l i d a t i o n
The consolidated financial statements incorporate the fi-
Goodwill arising on acquisition is recognised as an asset at
the date that control is assumed (the acquisition date) and
nancial statements of the Company and Group entities
initially measured at cost, being the excess of the cost of
controlled by the Company (its subsidiaries). Control is
the business combination over the Group’s interest in the
achieved where the Company has the power to govern the
fair value of the identifiable assets, liabilities and contin-
financial and operating policies of an investee entity so as
gent liabilities recognised.
to obtain benefits from its activities. The financial state-
ments of subsidiaries are included in the consolidated fi-
nancial statements from the date that control commenced
until the date that control ceases.
If, after reassessment, the Group’s interest in the net fair
value of the acquiree’s identifiable assets, liabilities and
contingent liabilities exceeds the cost of the business
combination, the excess is recognised immediately in
The interest of non-controlling shareholders is stated at the
the income statement. The interest of non-controlling
non-controlling interests’ proportion of the fair values of
shareholders in the acquiree is initially measured at the
the assets and liabilities recognised. Subsequently, losses
non-controlling interests’ proportion of the net fair value
applicable to the non-controlling interests are allocated
of the assets, liabilities and contingent liabilities rec-
against their interests even if doing so causes the non-con-
ognised.
trolling interests to have a deficit balance.
The results of entities acquired or disposed of during the
year are included in the consolidated income statement
from the effective date of acquisition or up to the effective
date of disposal, as appropriate.
Where necessary, the financial statements of the subsid-
iaries are adjusted to conform to the Group’s accounting
policies.
( b ) I n t a n g i b l e a s s e t s
Goodwill
Godwill arising on consolidations is recognised as and asset.
Following initial recognition, goodwill is subject to impair-
ment reviews, at least annually, and measured at cost less
accumulated impairment losses. The recoverable amount
is estimated at each reporting date. Any impairment loss
is recognised immediately in the income statement and is
All intra-group transactions, balances, income and expens-
not subsequently reversed when the carrying amount of
es are eliminated on consolidation.
the asset exceeds its recoverable amount.
Business combinations
The acquisition of subsidiaries is accounted for using the ac-
quisition method. The cost of the acquisition is measured
at the aggregate of the fair values, at the date of exchange
of assets given, liabilities incurred or assumed, and equity
Any impairment losses recognised in respect of cash gener-
ating units are allocated first to reduce the carrying amount
of any goodwill allocated to cash-generating units (groups
of units) and then to reduce the carrying amount of other
assets in the unit (groups of units) on a pro rata basis.
instruments issued by the Group in exchange for control
On disposal of a subsidiary the attributable amount of
of the acquiree, plus any costs directly attributable to the
goodwill is included in the determination of the gain or loss
business combination. The acquiree’s identifiable assets,
on disposal.
liabilities and contingent liabilities that meet the conditions
for recognition under IFRS 3 are recognised at their fair val-
ues at the acquisition date, except for non-current assets
Page 25
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( b ) I n t a n g i b l e a s s e t s ( c o n t i n u e d )
Other intangible assets
Other intangible assets are measured initially at cost and
are amortised on a straight-line basis over their estimated
useful lives. The carrying amount is reduced by any provi-
sion for impairment where necessary.
On a business combination, as well as recording separable
intangible assets already recognised in the statement of fi-
nancial position of the acquired entity at their fair value,
identifiable intangible assets that are separable or arise
from contractual or other legal rights are also included in
the acquisition statement of financial position at fair value.
Amortisation of intangible assets is charged over their
useful economic life, on the following basis:-
Non-compete agreement
5 ½ years
Licences
5-6 years
Non-monetary assets and liabilities are translated at the
historic rate. Monetary assets and liabilities denominated
in foreign currencies are translated into the functional cur-
rency at the rates of exchange ruling at the reporting date.
Non-monetary assets and liabilities denominated in foreign
currencies that are measured at fair value are retranslated
to the functional currency at the exchange rate at the date
that the fair value was determined.
Exchange differences arising on the settlement of mone-
tary items, and on the retranslation of monetary items, are
included in the income statement for the year, as either
finance income or finance costs depending on whether
foreign currency movements are in a net gain or net loss
position.
Exchange differences arising on the retranslation of
non-monetary items earned at fair value are included with-
in the income statement for the period except for differ-
ences arising on the retranslation of non-monetary items
in respect of which gains and losses are recognised direct-
ly in equity. For such non-monetary items, any exchange
component of that gain or loss is also recognised directly
in other comprehensive income. For the purpose of pre-
senting consolidated financial statements, the assets and
Brand name
7 years
liabilities of the Group’s foreign operations are translated
at exchange rates prevailing at the reporting date. Income
and expenses are translated at the average exchange rates
for the period, unless exchange rates fluctuate so as to
have a material impact on the financial statements during
that period, in which case the exchange rates at the date
of transactions are used. Exchange differences arising, if
any, are recognised in other comprehensive income and
are transferred to the Group’s foreign currency translation
reserve within equity. Such translation is recognised as in-
come or as expenses in the period in which the operation
is disposed of.
( d ) T a x a t i o n
The tax expense represents the sum of current tax and
deferred tax.
( c ) F o r e i g n c u r r e n c i e s
The individual financial statements of each Group entity
are presented in the currency of the primary economic
environment in which it operates (its functional currency).
For the purpose of the consolidated financial statements,
the results and financial position of each Group entities are
expressed in United States Dollars, which is the functional
currency of the Company, and the presentational currency
for the consolidated financial statements.
As of 1 September 2011, the Company changed its report-
ing currency to the US Dollar (note 2)
In preparing the financial statements of the individual
Group entities, transactions denominated in foreign cur-
rencies are translated into the respective functional curren-
cy of the Group entities using the exchange rates prevailing
at the dates of transactions.
Page 26
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e y e a r e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( d ) T a x a t i o n ( c o n t i n u e d )
Current taxation
Current tax is based on taxable profit for the period for the
Group. Taxable profit differs from net profit as reported in
the income statement because it excludes items of income
or expense that are taxable or deductible in other years
and it further excludes items that are never taxable or
deductible. The Group’s liability for current tax is calculat-
ed using tax rates that have been enacted or substantively
enacted by the reporting date.
Deferred taxation
Deferred tax is the tax expected to be payable or recover-
able on differences between the carrying amounts of as-
sets and liabilities in the financial statements and the cor-
responding tax bases used in the computation of taxable
profit, and is accounted for using the balance sheet liability
method. Deferred tax liabilities are generally recognised for
all taxable temporary differences and deferred tax assets
are recognised to the extent that it is probable that tax-
able profits will be available against which deductible tem-
porary differences can be utilised. Such assets and liabili-
ties are not recognised if the temporary difference arises
from goodwill or from the initial recognition (other than
in a business combination) of other assets and liabilities in
a transaction that affects neither the tax profit nor the ac-
counting profit. Deferred tax liabilities are recognised for
taxable temporary differences arising on the investments in
subsidiaries and associates, except where the Group is able
to control the reversal of the temporary difference and it is
probable that the temporary difference will not reverse in
the foreseeable future.
The carrying amount of deferred tax assets is reviewed at
each reporting date and reduced to the extent that it is no
longer probable that sufficient taxable profits will be avail-
asset is realised. Deferred tax is charged or credited in the
income statement, except when it relates to items charged
or credited to equity, in which case the deferred tax is also
dealt with in equity.
Deferred tax assets and liabilities are off set when there
is a legally enforceable right to set off current tax assets
against current tax liabilities and when they relate to in-
come taxes levied by the same taxation authority and the
Group intends to settle its current tax assets and liabilities
on a net basis.
( e ) O t h e r i n v e s t m e n t s
Other asset investments are stated at cost less accumulat-
ed impairment losses.
( f ) P r o p e r t y , p l a n t a n d e q u i p m e n t
Long leasehold land and buildings, plant and machinery,
motor vehicles and fixtures and fittings are stated in the
statement of financial position at their revalued amounts,
being the fair value at the date of revaluation, less any sub-
sequent accumulated depreciation and subsequent accu-
mulated impairment losses. Revaluations are performed
with sufficient regularity such that the carrying amount
does not differ materially from that which would be deter-
mined using fair values at the reporting date.
Any revaluation increase arising on the revaluation of such
assets is credited to the revaluation reserve, except to the
extent that it reverses a revaluation decrease for the same
asset previously recognised as an expense, in which case
the increase is credited to the income statement to the
extent of the decrease previously charged. A decrease in
carrying amount arising on the revaluation of such asset
is charged as an expense to the extent that it exceeds the
balance, if any, held in the revaluation reserve relating to a
previous revaluation of that asset. Depreciation on reval-
ued assets is charged to the income statement. On subse-
quent sale or retirement of a revalued asset, the attribut-
able revaluation surplus remaining is transferred directly to
able to allow all or part of the asset to be recovered.
retained earnings.
Deferred tax is calculated at the tax rates that are expected
to apply in the period when the liability is settled or the
Page 27
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( f ) P r o p e r t y , p l a n t a n d e q u i p m e n t
Depreciation is charged straight line so as to write off the
( c o n t i n u e d )
cost or valuation of assets, other than land, over their esti-
mated useful lives. The annual rates used for this purpose
are:
Freehold buildings
2%
Leasehold land and buildings Over the term of the lease
Plant and machinery
10%
Motor cars
15%-25%
Fixtures and fittings
15%-25%
measured on initial recognition and at subsequent report-
ing dates at fair value less estimated costs to sell, unless fair
value cannot be reliably measured. All costs related to bio-
logical assets that are measured at fair value are recognized
as expenses when incurred, other than costs to purchase
biological assets.
( h ) I m p a i r m e n t o f a s s e t s e x c l u d i n g
At each reporting date, the Group reviews the carrying
g o o d w i l l
amounts of its tangible and intangible assets to determine
whether there is any indication that those assets have suf-
fered an impairment loss. If any such indication exists, the
recoverable amount of the asset is estimated in order to de-
termine the extent of any impairment loss. Where the as-
set does not generate cash flows that are independent from
other assets, the Group estimates the recoverable amount
of the cash-generating unit to which the asset belongs. Re-
coverable amount is the higher of fair value less costs to sell
The gain or loss arising on the disposal of an asset is deter-
and value in use. In assessing value in use, the estimated
mined as the difference between the sales proceeds and
future cash flows are discounted to their present value using
the carrying amount of the asset and is recognised in the
a pre-tax discount rate that reflects current market assess-
income statement for the year.
ments of the time value and the risks specific to the asset
for which the estimates of future cash flows have not been
Assets held under finance leases are depreciated over their
expected useful lives on the same basis as owned assets, or
adjusted.
where shorter, over the relevant lease term. No deprecia-
If the recoverable amount of an asset (or cash-generating
tion is provided on freehold land.
In respect of aircraft, subsequent costs incurred which lend
enhancement to future periods such as long term sched-
uled maintenance and major overhaul of aircraft and en-
gines are capitalised and amortised over the length of the
period benefiting from these enhancements, except when
unit) is estimated to be less than its carrying amount, the
carrying amount of the asset (or cash-generating unit) is re-
duced to its recoverable amount. An impairment loss is rec-
ognised as an expense immediately, unless the relevant as-
set is carried at a revalued amount in which case the reversal
of the impairment loss is treated as a revaluation decrease.
assets are held for sale they are accrued over the time to
Where an impairment loss subsequently reverses, the carry-
the next maintenance overhaul. All other costs relating to
ing amount of the asset (or cash-generating unit) is increased
maintenance are charged to the income statement as in-
to the revised estimate of its recoverable amount, but so that
curred.
Property, plant and equipment identified for disposal are
reclassified as assets held for resale.
( g ) B i o l o g i c a l a s s e t s
Biological assets which consist of living animals (game) are
Page 28
the increased carrying amount does not exceed the carrying
amount that would have been determined had no impair-
ment loss been recognised for the asset (or cash-generating
unit) in prior years. A reversal of an impairment loss is rec-
ognised as income immediately, unless the relevant asset is
carried at a revalued amount, in which case the reversal of
the impairment loss is treated as a revaluation increase.
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
The Board’s policy is to maintain a strong capital base so as
to maintain investor, creditor and market confidence and to
sustain future development of the business. The Board of
Directors monitors the return on capital, which the Group
defines as net operating income divided by total sharehold-
ers’ equity, excluding non-controlling interests.
( i ) F i n a n c i a l i n s t r u m e n t s
Non-derivative financial instruments comprise investments
Bank borrowings
in equity, trade and other receivables, cash and cash equiv-
alents, loans and borrowings and trade and other payables.
Interest bearing bank loans and overdrafts are recorded at
Financial assets and financial liabilities are recognised
the proceeds received, net of direct issue costs. Finance
in the Group’s statement of financial position when the
charges, including premiums payable on settlement or re-
Group becomes a party to the contractual provisions of the
demption and direct issue costs, are accounted for on an
instrument.
Cash and cash equivalents
amortised cost basis to the income statement using the
effective interest method and are added to the carrying
amount of the instrument to the extent that they are not
settled in the period in which they arise.
Cash and cash equivalents comprise cash in hand and de-
mand deposits and other short term highly liquid invest-
Equity instruments
ments that are readily convertible to a known amount of
cash and are subject to an insignificant risk of changes in
Equity instruments issued by the Company are recorded at
value. Bank overdrafts that are repayable on demand and
the proceeds received, net of direct issue costs.
form an integral part of the Group’s cash management are
included as a component of cash and cash equivalents for
the purpose of the statement of cash flows.
Trade receivables
( j ) I n v e n t o r i e s
Inventories are stated at the lower of cost and net real-
isable value. Cost comprises direct materials and where
applicable direct expenditure and attributable overheads
Trade receivables are initially measured at fair value and
that have been incurred in bringing the inventories to their
are subsequently measured at amortised cost using the
present location and condition. Net realisable value rep-
effective interest rate method. Appropriate allowances for
resents the estimated selling price less all estimated costs
estimated recoverable amounts are recognised in profit or
of completion and costs to be incurred in marketing, selling
loss when there is objective evidence the asset is impaired.
and distribution.
Trade payables
Trade payables are initially measured at fair value and are
( k ) S h a r e b a s e d p a y m e n t s
The Group provides benefits to certain employees (includ-
subsequently measured at amortised cost using the effec-
ing senior executives) of the Group in the form of share
tive interest rate method.
Financial liabilities
Financial liabilities are classified according to the substance
of the contractual arrangements entered into.
Capital management
based payments, whereby employees render services in
exchange for shares or rights over shares (equity-settled
transactions).The cost of these equity-settled transactions
with employees is measured by reference to the fair val-
ue of the equity instruments at the date at which they
are granted. The fair value is determined by using a Black-
Scholes model. The dilutive effect, if any, of outstanding
options is reflected as additional share dilution in the com-
Page 29
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
putation of earnings per share.
over the period of the lease.
3. Significant accounting policies
(continued)
( k ) S h a r e b a s e d p a y m e n t s
The grant date fair value of options granted to employees
( c o n t i n u e d )
is recognised as an employee expense with a correspond-
ing increase in equity over the period that the employees
become unconditionally entitled to the options.
( l ) I n t e r e s t - b e a r i n g b o r r o w i n g s
Interest-bearing borrowings are recognised initially at fair
value less attributable transaction costs. Subsequent to
initial recognition, interest-bearing borrowings are stated
at amortised cost with any difference between cost and
redemption value being recognised in the income state-
ment over the period of the borrowings on an effective
interest basis.
( m ) D i v i d e n d s
Interim dividends are recognised as a liability in the period
in which they are proposed and declared.
Final dividends are recognised when approved by the
shareholders.
( n ) P r o v i s i o n s
A provision is recognised in the statement of financial po-
( o ) R e v e n u e r e c o g n i t i o n
Revenue is derived from the sale of goods and services and
is measured at the fair value of consideration received or
receivable, after deducting discounts, volume rebates, val-
ue-added tax and other sales taxes. A sale of goods and
services is recognised when recovery of the consideration
is probable, there is no continuing management involve-
ment with the goods and services and the amount of reve-
nue can be measured reliably.
A sale of goods is recognised when the significant risks and
rewards of ownership have passed to the buyer, the asso-
ciated costs and possible return of goods can be estimated
reliably. This is when title and insurance risk have passed
to the customer and the goods have been delivered to a
contractually agreed location.
( p ) L e a s e s
Leases are classified according to the substance of the
transaction. A lease that transfers substantially all the risks
and rewards of ownership to the lessee is classified as a
finance lease. All other leases are classified as operating
leases.
Finance leases
Finance leases are capitalised at their fair value or, if low-
er, at the present value of the minimum lease payments,
each determined at the inception of the lease. The cor-
sition when the Group has a present legal or constructive
responding liability is shown as a finance lease obligation
obligation as a result of a past event, and it is probable that
to the lessor. Leasing repayments comprise both a capital
an outflow of economic benefits will be required to settle
and finance element. The finance element is written off to
the obligation. If the effect is material, provisions are de-
the income statement so as to produce an approximately
termined by discounting the expected future cash flows at
constant periodic rate of charge on the outstanding obliga-
a pre-tax rate that reflects current market assessments of
tions. Such assets are depreciated over the shorter of their
the time value of money and, where appropriate, the risks
estimated useful lives and the period of the lease.
specific to the liability.
Operating leases
A sale of services is recognised when the service has been
rendered.
Aircraft lease income is recognised on an accruals basis
Page 30
Operating lease rentals are charged to the income state-
ment on a straight line basis over the period of the lease.
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( q ) B o r r o w i n g c o s t
Borrowing costs directly attributable to the acquisition,
construction or production of a qualifying asset, 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 sub-
stantially ready for their intended use or sale. Investment
income earned on the temporary investment of specific
the lower of carrying amount and fair value less costs to
sell. Immediately before reclassification as held for sale,
the assets are remeasured in accordance with the Group’s
accounting policies. Thereafter generally the assets are
measured at the lower of their carrying amount and fair
value less costs to sell. Impairment losses on initial classifi-
cation as held for sale and subsequent gains and losses on
re-measurement are recognised in the profit or loss. Gains
are not recognised in excess of any cumulative impairment
loss.
( t ) S e g m e n t r e p o r t i n g
A segment is a distinguishable component of the Group
borrowings pending their expenditure on qualifying assets
that is engaged either in providing products or services
is deducted from the borrowing costs eligible for capital-
isation.
All other borrowing costs are recognised in the income
statement in the period in which they are incurred.
(business segment), or in providing products or services
within a particular economic environment (geographical
segment), which is subject to risks and rewards that are dif-
ferent from those of other segments.
( r ) L o s s p e r s h a r e
Basic loss per share is calculated based on the weighted
average number of ordinary shares outstanding during the
year. Diluted loss per share is based upon the weighted
average number of shares in issue throughout the year, ad-
justed for the dilutive effect of potential ordinary shares.
The only potential ordinary shares in issue are employee
share options.adjusted for the dilutive effect of potential
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s
Up to the date of issue of these financial statements, the
IASB has issued a number of amendments, new standards
and interpretations which are not yet effective for the year
ended 31 August 2012 and which have not been adopted in
these financial statements.
ordinary shares. The only potential ordinary shares in issue
The Company is in the process of making an assessment
are employee share options.
( s ) N o n - c u r r e n t a s s e t s h e l d f o r
Non-current assets that are expected to be recovered pri-
s a l e
marily through sale or distribution rather than through
continuing use are classified as held for sale, measured at
Standard/Interpretation
of what the impact of these amendments, new standards
and new interpretations is expected to be in the period of
initial application. So far, it has concluded that the adoption
of them is unlikely to have a significant impact on the Com-
pany’s results of operations and financial position. These
statements, where applicable, will be applied in the year
when they are effective.
Effective date Annual periods beginning on or after
Amendments to IAS 1
Presentation of items of other comprehensive income
IFRS 10
IFRS 11
IFRS 12
IFRS 13
Consolidated Financial Statements
Joint Arrangements
Disclosure of Interest in Other Entities
Fair Value Measurement
1 July 2012*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
Page 31
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies (continued)
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s a n d a m e n d m e n t s t o p u b l i s h e d
Standard/Interpretation
Effective date Annual periods beginning on or after
s t a n d a r d s ( c o n t i n u e d )
IAS 27
IAS 28
IAS 19
IFRIC 20
Separate Financial Statements (2011)
Investments in Associates and Joint Ventures (2011)
Employee Benefits (amended 2011)
Stripping Costs in the Production Phase of a Surface
Mine
Amendments to IFRS 1
Government Loans
Amendments to IFRS 7
Disclosures: Offsetting Financial Assets and Financial
Liabilities
Amendments to IFRS 10,
IFRS 11 and IFRS 12
Consolidated Financial Statements, Joint Arrangements
and Disclosure of Interests in Other Entities: Transition
Guidance
Amendments to IAS 32
Offsetting Financial Assets and Financial Liabilities
Amendments to IFRS 10,
IFRS 12 and IAS 27
Investment entities
IFRS 9
Financial Instruments
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
1 January 2013*
* All Standards and Interpretations will be adopted at their effective date (except for those Standards and Interpretations
that are not applicable to the entity).
Presentation of Items of Other Comprehensive Income
(Amendments to IAS 1 Presentation of financial state-
ments)
The amendments to IAS 1 will be adopted by the Company
for the first time for its financial reporting period ending 31
August 2013. The standard will be applied retrospectively.
The amendments:
The amendments do not address which items are present-
ed in other comprehensive income or which items need to
be reclassified. The requirements of other IFRSs continue
to apply in this regard.
The impact on the financial statements for the Company
has not yet been estimated.
IFRS 10 Consolidated Financial
Statements
• require that an entity present separately the items of
other comprehensive income that would be reclassi-
fied to profit or loss in the future if certain conditions
are met from those that would never be reclassified
to profit or loss;
The standard will be adopted by the Company for the first
time for its financial reporting period ending 31 August
2013. The standard will be applied retrospectively, subject
to transitional provisions.
• do not change the existing option to present profit or
loss and other comprehensive income in two state-
ments; and
IFRS 10 changes the definition of control, such that the
same consolidation criteria will apply to all entities. The
revised definition focuses on the need to have both “pow-
er” and “variable returns” for control to be present.
• change the title of the statement of comprehensive
income to the statement of profit or loss and other
comprehensive income. However, the entity is still
allowed to use other titles.
Page 32
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
• always requires the equity method for jointly con-
trolled entities that are now called joint ventures;
they are stripped of the free choice of using the equi-
ty method or proportionate consolidation.
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s ( c o n t i n u e d )
IFRS 10 Consolidated Financial
Statements (continued)
The impact on the financial statements for the Company
has not yet been estimated.
IFRS 12 Disclosure of Interests with Other Entities
Power is the current ability to direct the activities that
significantly influence returns. Variable returns can be
The standard will be adopted by the Company for the first
time for its financial reporting period ending 31 August
positive, negative or both. The determination of power
2013.
is based on current facts and circumstances (including
substantive potential voting rights) and is continuously
assessed.
An investor with more than half the voting rights would
meet the power criteria in the absence of restrictions or
other circumstances. However, an investor could have
power over the investee even when it holds less than the
majority of the voting rights in certain cases.
IFRS 12 sets out the required disclosures for entities report-
ing under IFRS 10 and IFRS 11. The objective of IFRS 12 is to
require entities to disclose information that helps financial
statement readers to evaluate the nature, risks, and finan-
cial effects associated with the entity’s involvement with
subsidiaries, associates, joint arrangements, and unconsol-
idated structured entities. Specific disclosures include the
significant judgments and assumptions made in determin-
ing control as well as detailed information regarding the
IFRS 10 provides guidance on participating and protective
entity’s involvement with these investees.
rights, and brings the notion of “de facto” control firmly
within the guidance. The standard also requires an investor
The impact on the financial statements for the Company
with decision making rights to determine if it is acting as a
has not yet been estimated.
principal or an agent and provides factors to consider. If an
investor acts as an agent, it would not have the requisite
power and, hence, would not consolidate.
The impact on the financial statements for the Company
has not yet been estimated.
IFRS 11 Joint Arrangements
The standard will be adopted by the Company for the first
time for its financial reporting period ending 31 August
2013.
IFRS 13 Fair Value Measurement
The standard will be adopted by the Company for the first
time for its financial reporting period ending 31 August
2013.
IFRS 13 replaces the fair value measurement guidance con-
tained in individual IFRSs with a single source of fair value
measurement guidance. It defines fair value, establishes
a framework for measuring fair value and sets out disclo-
sure requirements for fair value measurements. It explains
how to measure fair value when it is required or permitted
IFRS 11 focuses on the rights and obligations of joint ar-
by other IFRSs. It does not introduce new requirements to
rangements, rather than the legal form (as it is currently
measure assets or liabilities at fair value, nor does it elim-
the case). It:
• distinguishes joint arrangements between joint oper-
ations and joint ventures; and
inate the practicability exceptions to fair value measure-
ments that currently exist in certain standards.
Page 33
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
even if an investment in an associate becomes an in-
vestment in a joint venture or vice versa, the entity
does not re-measure the retained interest.
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s ( c o n t i n u e d )
IFRS 13 Fair Value Measurement (continued)
The impact on the financial statements for the Company
has not yet been estimated.
IAS 19: Employee Benefits (amended 2011)
IFRS 13 defines fair value as the price that would be re-
ceived to sell an asset or paid to transfer a liability in an
The amendments to IAS 19 will be adopted by the Compa-
ny for the first time for its financial reporting period ending
orderly transaction between market participants at the
31 August 2013.
measurement date, i.e. an exit price.
The impact on the financial statements for the Company
has not yet been estimated.
One of the significant changes in the amended standard is
the elimination of the ‘corridor method’ under which the
recognition of actuarial gains and losses could be deferred.
Instead, all actuarial gains and losses are recognised imme-
IAS 27 Separate Financial Statements (2011)
diately in other comprehensive income. This is generally
The amendments to IAS 27 will be adopted by the Company
for the first time for its financial reporting period ending 31
August 2013. The standard will be applied retrospectively.
The standard contains accounting and disclosure require-
ments for investments in subsidiaries, joint ventures and
associates when an entity prepares separate financial
statements. The Standard requires an entity preparing sep-
arate financial statements to account for those investments
at cost or in accordance with IFRS 9 Financial Instruments.
The impact on the financial statements for the Company
has not yet been estimated.
IAS 28 Investments in Associates and Joint Ventures
(2011)
The amendments to IAS 28 will be adopted by the Company
for the first time for its financial reporting period ending 31
August 2013. The standard will be applied retrospectively.
expected to have a significant impact on those entities cur-
rently applying the corridor method. However, even if an
entity does not currently apply the corridor method, the
amended standard may still have a significant effect on en-
tities with funded defined benefit plans. This is principally
because it introduces a new approach to calculating and
presenting the net interest income or expense on the net
defined benefit liability (asset). This is now calculated as a
single net interest figure, based on the discount rate that is
used to measure the defined benefit obligation. As a con-
sequence, an entity is no longer able to recognise in profit
or loss the long-term expected return on the plan assets ac-
tually held; for many entities this will result in a reduction
in net profit from that reported under the current IAS 19.
The amended standard alters both the timing and location
of recognition of the changes in the net defined benefit
liability (asset) and each entity will need to evaluate the
impact from its own perspective.
The impact on the financial statements for the Company
IAS 28 makes the following amendments:
has not yet been estimated.
• IFRS 5 applies to an investment, in an associate or a
joint venture that meets the criteria to be classified as
held for sale; and
• On cessation of significant influence or joint control,
Page 34
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s ( c o n t i n u e d )
IFRIC 20 Stripping Costs in the Production Phase of a
Surface Mine
If applicable, the standard would be required to be adopted
by the Company for the first time for its financial reporting
The amendments to IFRS 7 include minimum disclosure re-
quirements related to financial assets and financial liabili-
ties that are:
• offset in the statement of financial position; or
• subject to enforceable master netting arrangements
or similar agreements.
They include a tabular reconciliation of gross and net
amounts of financial assets and financial liabilities, sepa-
rately showing amounts offset and not offset in the state-
period ending 31 August 2013.
ment of financial position.
In IFRIC 20 Stripping Costs in the Production Phase of a
The impact on the financial statements for the Company
Surface Mine, the IFRS Interpretations Committee sets out
has not yet been estimated.
principles for the recognition of production stripping costs
in the balance sheet. The interpretation recognises that
some production stripping in surface mining activity will
benefit production in future periods and sets out criteria
for capitalising such costs.
As the Company is not engaged in Surface Mining Opera-
tions, no impact on the financial statements is anticipated.
Government Loans (Amendments to IFRS 1)
The standard will be adopted by the Company for the first
time for its financial reporting period ending 31 August
2013.
Consolidated Financial Statements, Joint Arrange-
ments and Disclosure of Interests in Other Entities:
Transition Guidance (Amendments to IFRS 10, IFRS 11
and IFRS 12)
The amendments will be adopted by the Company for the
first time for its financial reporting year ended 31 August
2013. The standard will be applied retrospectively
Depending on the extent of comparative information pro-
vided in the financial statements, the amendments simplify
the transition and provide additional relief from disclosures
that could have been onerous.
The amendments add a new exception to retrospective ap-
plication of IFRS. A first-time adopter of IFRS now applies
the measurement requirements of the financial instrument
standards to a government loan with a below-market rate
The amendments limit the restatement of comparatives to
the immediately preceding period; this applies to the full
suite of standards. Entities that provide comparatives for
more than one period have the option of leaving additional
of interest prospectively from the date of transition to IFRS.
comparative periods unchanged.
The impact on the financial statements for the Company
has not yet been estimated.
Disclosures – Offsetting financial assets and financial
liabilities (Amendments to IFRS 7)
In addition, the date of initial application is now defined in
IFRS 10 as the beginning of the annual reporting period in
which the standard is applied for the first time. At this date,
an entity tests whether there is a change in the consolida-
tion conclusion for its investees.
The amendments to IFRS 7 will be adopted by the Company
The impact on the financial statements for the Company
for the first time for its financial reporting period ending 31
has not yet been estimated.
August 2013. The standard will be applied retrospectively.
Page 35
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s ( c o n t i n u e d )
Offsetting financial assets and financial liabilities
(Amendments to IAS 32)
tory – not optional.
The parent of an investment entity (that is not itself an in-
vestment entity) is still required to consolidate all subsid-
iaries.
New disclosures include quantitative data about the invest-
ment entity’s exposure to risks arising from its unconsoli-
dated subsidiaries – i.e. the disclosures now apply to the
investee as a single investment rather than to the consol-
The amendments to IAS 32 will be adopted by the Company
idated investee’s underlying financial assets and financial
for the first time for its financial reporting period ending 31
liabilities.
August 2014. The standard will be applied retrospectively.
The amendments to IAS 32 clarify that: an entity currently
has a legally enforceable right to set-off if that right is:-
IFRS 9: Financial Instruments
IFRS 9 (2010) will be adopted by the Company for the first
time for its financial reporting period ending 31 August 2015.
• not contingent on a future event; and
The standard will be applied retrospectively, subject to tran-
• enforceable both in the normal course of business and
sitional provisions.
in the event of default, insolvency or bankruptcy of
IFRS 9 (2009) addresses the initial measurement and classi-
the entity and all counterparties; and
fication of financial assets and will replace the relevant sec-
• gross settlement is equivalent to net settlement if and
tions of IAS 39.
only if gross settlement mechanism has features that;
Under IFRS 9, there are two options in respect of classifica-
• eliminate or result in insignificant credit and liquidity
risk; and
• process receivables and payables in a single settle-
ment process or cycle
tion of financial assets, namely, financial assets measured at
amortised cost or at fair value. Financial assets are measured
at amortised cost when the business model is to hold assets
in order to collect contractual cash flows and when they give
rise to cash flows that are solely payments of principal and
interest on the principal outstanding. All other financial as-
The impact on the financial statements for the Company
sets are measured at fair value.
The standard eliminates the existing IAS 39 categories of
held to maturity, available for sale and loans and receivables.
The standard requires that derivatives embedded in con-
tracts with a host that is a financial asset within the scope of
the standard are not separated; instead the hybrid financial
instrument is assessed in its entirety as to whether it should
be measured at amortised cost or fair value.
has not yet been estimated.
Investments entities (Amendments to IFRS 10, IFRS 12
and IAS 27)
The standards will be adopted by the Company for the first
time for its financial reporting year ended 31 August 2014.
A qualifying investment entity is required to account for in-
vestments in controlled entities – as well as investments in
associates and joint ventures – at fair value through profit
or loss (FVTPL); the only exception would be subsidiaries
that are considered an extension of the investment entity’s
investing activities. The consolidation exception is manda-
Page 36
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
3. Significant accounting policies
(continued)
( u ) N e w s t a n d a r d s i n t e r p r e t a t i o n s
a n d a m e n d m e n t s t o p u b l i s h e d
s t a n d a r d s ( c o n t i n u e d )
IFRS 9: Financial Instruments
Under IFRS 9 (2010), the classification and measurement
requirements of financial liabilities are the same as per IAS
39, barring the following two aspects:
fair value changes for financial liabilities (other than finan-
cial guarantees and loan commitments) designated at fair
value through profit or loss, attributable to the changes
in the credit risk of the liability will be presented in other
comprehensive income (OCI). The remaining change is rec-
ognised in profit or loss. However, if the requirement cre-
ates or enlarges an accounting mismatch in profit or loss,
then the whole fair value change is presented in profit or
loss. The determination as to whether such presentation
would create or enlarge an accounting mismatch is made
posal group, are remeasured in accordance with the
Group’s other accounting policies. Thereafter, generally
the assets, or disposal group, are measured at the lower
of their carrying amount and fair value less costs to sell.
Any impairment loss on a disposal group is allocated first to
goodwill, and then to the remaining assets and liabilities on
a pro rata basis, except that no loss is allocated to invento-
ries, financial assets, deferred tax assets, employee benefit
assets, investment property or biological assets, which con-
tinue to be measured in accordance with the Group’s other
accounting policies. Impairment losses on initial classifi-
cation as held-for-sale or held-for-distribution and subse-
quent gains and losses on remeasurement are recognised
in profit or loss. Gains are not recognised in excess of any
cumulative impairment loss.
Once classified as held-for-sale or held-for-distribution, in-
tangible assets and property, plant and equipment are no
longer amortised or depreciated, and any equity-account-
ed investee is no longer equity accounted.
Discontinued operations
on initial recognition and is not subsequently reassessed.
A discontinued operation is a component of the Group’s
Under IFRS 9, derivative liabilities that are linked to and
must be settled by delivery of an unquoted equity instru-
business, the operations and cash flows of which can be
clearly distinguished from the rest of the Group and which:
ment whose fair value cannot be reliably measured, are
• represents a separate major line of business or geo-
measured at fair value.
graphical area of operations;
The impact on the financial statements for the Company
• is part of a single co-ordinated plan to dispose of a
has not yet been estimated.
separate major line of business or geographical area
( v ) A s s e t s h e l d f o r s a l e a n d d i s-
Assets held for sale
c o n t i n u e d o p e r a t i o n s
Non-current assets, or disposal groups comprising assets
and liabilities, are classified as held-for-sale or held-for-dis-
tribution if it is highly probable that they will be recovered
of operations; or
• is a subsidiary acquired exclusively with a view to
re-sale.
Classification as a discontinued operation occurs on dispos-
al or when the operation meets the criteria to be classified
as held-for-sale, if earlier.
primarily through sale or distribution rather than through
When an operation is classified as a discontinued opera-
continuing use.
Immediately before classification as held-for-sale or
held-for-distribution, the assets, or components of a dis-
tion, the comparative statement of comprehensive income
is re-presented as if the operation had been discontinued
from the start of the comparative year.
Page 37
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
Segment information is presented in respect of the Group’s
4. Segment reporting
business segments. The primary format, business seg-
ments, is based on the Group’s management and internal
reporting structure. The results of the business segments
are reviewed regularly by the Group’s CEO to make deci-
• IT Hardware Distribution
• Industrial Chemicals
• Manufacture and Distribution of industrial
solvents and industrial and mining chemicals
• Commercial Printing
sions about resources to be allocated to the segment and
• Head Office
to assess its performance, and for which discrete financial
information is available.
In addition, the following segments are reported separately
as discontinued operations:
Inter-segment pricing is determined on an arm’s length ba-
sis.
• Hotels
Segment results that are reported to the CEO include items
directly attributable to a segment as well as those that
• Aviation
• Mobile Communication Hardware Services
• Outsource and IT Services, including, Pharmaceuticals
can be allocated on a reasonable basis. Unallocated items
comprise mainly income-earning assets and revenue, inter-
est-bearing loans, borrowings and expenses, and corporate
assets and expenses primarily relating to Company’s head
office.
Segment capital expenditure is the total cost incurred
during the period to acquire segment assets that are ex-
pected to be used for more than one period.
Inter-segment revenue is eliminated.
Geographical segments
Support services and hotels operate primarily in Zimbabwe
and the Beira Corridor of Mozambique. Separate geo-
graphical analysis has therefore not been presented.
Business segments
For management purposes, the Group is currently organ-
ised into five main business segments.
• Aviation
• Hotels
• Outsource and It Services
• Payments and Business Process Outsourcing
• Payroll services
Page 38
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
4. Segment reporting (continued)
Business segments
Continuing operations
For the year end
31 August 2012
Revenue from external customers
Cost of sales to external customers
Operating costs
Net Losses on disposal of invest-
ments and impairment of assets
Accelerated write off of intangibles
and goodwill impairment
Operating (loss) /profit
Net financing (expenses)/ income
Income tax credit/ (expense)
(Loss)/Profit for the year
Continuing operations
For the year end
31 August 2011
Revenue from external customers
Cost of sales to external customers
Operating costs
Accelerated write off of intangibles
and goodwill impairment
Operating (loss) /profit
Net financing (expenses)/ income
Income tax credit/ (expense)
(Loss)/Profit for the year
Discontinued operations
Hotels
US$’000
2,450
(556)
(3,001)
-
-
(1,107)
(13)
200
(920)
Hotels
US$’000
2,096
(1,093)
(1,631)
-
(628)
143
(485)
Industrial
Chemicals
US$’000
3,770
(3,058)
(956)
-
-
(244)
(34)
(278)
Printing
Outsource and
IT Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
1,817
(1,249)
(1,583)
-
-
(1,015)
(10)
(381)
(1,406)
3,951
(337)
(1,693)
-
(788)
1,133
7
(195)
945
-
-
(5,925)
(1,621)
11,988
(5,200)
(13,158)
(1,621)
(9,830)
(10,618)
(17,376)
(18,609)
(312)
(120)
(362)
(496)
(17,808)
(19,467)
Industrial
Chemicals
US$’000
Printing
Outsource and
IT Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
1,665
(1,292)
(594)
(34)
(255)
(64)
(319)
1,270
(213)
(1,017)
-
40
49
89
3,046
(799)
(2,065)
-
182
(59)
123
-
-
(7,764)
(245)
(8,018)
(664)
-
(8,682)
8,077
(3,397)
(13,071)
(288)
(8,679)
(664)
69
(9,274)
For the year end
31 August 2012
Hotels
Aviation
Outsource and IT
Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
US$’000
Revenue from external customers
Cost of sales to external customers
Operating costs
Net Losses on disposal of invest-
ments and impairmant of assets
Operating (loss) /profit
Non-operating exceptional
expenses
Internet payable
Loss for the year
345
-
(1,241)
(3,223)
(4,119)
-
-
(4,119)
753
(1,017)
(1,217)
-
(1,481)
(483)
(20)
(1,984)
-
-
-
-
-
(118)
-
(118)
1,098
(1,017)
(2,458)
(3,223)
(5,600)
(601)
(20)
(6,221)
Page 39
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
4. Segment reporting (continued)
Business segments (continued)
Discontinued operations
For the year end
31 August 2011
Hotels
Aviation
Outsource and IT
Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
US$’000
Revenue from external customers
Cost of sales to external customers
Operating costs
Operating loss
Interest payable
Loss for the year
Continuing operations
For the year end
31 August 2012
Segment Assets
Segment Liabilities
For the year ended 31 August 2011
Segment Assets
Segment Liabilities
-
-
-
-
-
-
638
-
(1,249)
(611)
(166)
(777)
872
(822)
(174)
(124)
(124)
-
-
-
-
-
-
1,510
(822)
(1,423)
(735)
(166)
(901)
Hotels
US$’000
21,498
4,818
20,947
765
Industrial
Chemicals
US$’000
1,522
508
774
289
Printing
Outsource and
IT Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
4,381
725
4,275
798
4,889
1,121
4,832
371
3,488
4,529
16,812
2,652
34,901
11,461
55,418
6,807
The following table shows the assets and liabilities for discontinued operations. The presentation requirements for assets
and liabilities classified as held for sale at the end of the reporting period do not apply retrospectively, therefore the figures
below relating to 2011 are not represented in the statement of financial position, however are disclosed below for complete-
ness of segment reporting.
Discontinued operations
For the year end
31 August 2012
Segment Assets
Segment Liabilities
For the year ended 31 August
2011
Segment Assets
Segment Liabilities
Page 40
Hotels
Aviation
Outsource and IT
Services
Head office
Total
US$’000
US$’000
US$’000
US$’000
US$’000
-
-
3,123
(953)
222
(1)
5,274
(714)
139
(509)
1,778
(508)
-
-
1,302
-
361
(510)
11,477
(2,175)
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
5. Group net operating costs
Cost of sales
Administrative expenses
Net operating costs
Administrative expenses include management related overheads for operations and head office.
Operating costs include:
Depreciation of property, plant and
equipment
Amortisation
Operating lease rentals
Land and Buildings
Personnel expenses
(Loss) / gain on investments
Auditors Remuneration
Fees Payable to the Company
Auditors for :
The audit of the Group’s Financial
Statements
The audit of the Company’s subsid-
iaries pursuant to legislation
Total audit fees
The aggregate remuneration comprised (including Executive Directors):
6. Personnel expenses
Wages and salaries
Compulsory social security contributions
Total personnel expenses
2012
US$’000
5,200
13,158
18,358
2011
US$’000
3,397
13,071
16,468
2012
US$’000
2012
US$’000
1,217
2,019
224
4,899
(7)
188
145
333
1,035
3,045
166
4,121
13
180
49
229
2012
US$’000
4,787
112
4,899
2011
US$’000
4,003
118
4,121
Page 41
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
6. Personnel expenses (continued)
The average number of employees (including Executive Directors) was:
Aviation
Hotels
Outsource and IT services
Industrial chemicals
Printing
Head Office
Total
Remuneration of Directors
Directors’ emoluments (see note 36)
2012
Number
2010
Number
-
132
65
24
74
9
304
-
200
59
20
76
7
362
2012
US$’000
2011
US$’000
1,598
1,109
7. Net finance (costs)/income
2012
US$’000
2011
US$’000
Recognised in income statement:
Bank interest receivable
Loan interest receivable
Finance income
Foreign exchange loss
Bank interest payable
Loan interest payables
Finance costs
Net finance (costs)/income
The foreign exchange loss of nil (2011: loss of US$683 thousand) has arisen on the translation of inter-
company balances.
8. Taxation
Income tax recognised in the income statement
Current tax expense
Curent period
Deferred tax expense / (credit)
Origination and reversal of temporary differences
Deferred tax assets derecognised
Total income tax credit in income statement
Page 42
8
304
312
-
(332)
(342)
(674)
(362)
-
299
299
(683)
(280)
-
(963)
(664)
2012
US$’000
2011
US$’000
174
(59)
381
496
184
(253)
-
(69)
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
8. Taxation (continued)
Reconciliation of effective tax rate
Loss before tax
Income tax using the U.K. corporation tax rate 26% (2011:28%)
Net losses where no group relief is available
Deferred tax
Charge relating to intangible assets
Relating to losses in subsidiaries
Deferred tax assets derecignised
2012
US$000
(18,971)
(4,932)
4,932
-
2011
US$000
(9,343)
(2,616)
2,616
-
2012
US$’000
2011
US$’000
-
(59)
381
322
-
(253)
-
(253)
Corporation tax is calculated as 26 per cent (2011: 28 per
• Lonzim Air (BVI) Limited “Lonzim Air”
cent) of the estimated assessable loss for the year. Taxation
for other jurisdictions is calculated at the rates prevailing in
the respective jurisdictions.
Deferred tax is recognised as an asset on the basis that the
Group will generate future profits to offset against the as-
set. The asset is derived from the losses which the Group
has experienced to date.
• Diospyros Investments (Pvt) Limited (trading as
“CES”)
• Forget Me Not Africa (BVI) Limited (“FMNA”)
• Panafmed (Pty) Limited
The financial effect of these discontinued operations is
shown in the operating segment disclosures in note 4.
During the year, the Company sold its investments in the
9. Discontinued operations
following entities (see note 16):
• ALDEAMENTO TURISTICO DE MACUTI SARL (“ATDM”)
• CELSYS ZAMBIA LIMITED (“Celsys Zambia”)
The calculation of basic and diluted earnings per share
10. Loss per share
at 31 August 2012 was based on the profit attributable
to ordinary shareholders of US$27,271 thousand (2011:
US$9,195 thousand) and a weighted average number of
ordinary shares outstanding of 57,959 thousand (2011:
• SOL AVIATION PRIVATE LIMITED (“Sol Aviation”)
48,207 thousand), calculated as follows:
• FIRST FOOD ENTERPRISES (PRIVATE) LIMITED (“FIRST
FOOD”)
During the year, the Company classed the following subsid-
iaries as discontinued operations, on the basis that they are
held for sale and meet the criteria of discontinued opera-
tions under IFRS 5:
Page 43
Financial Report 2012 Notes to the Financial Statements (continued)
10. Loss per share (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
Profit attributable to ordinary shareholders
Loss for the purposes of basic loss and dilutive per share being net loss attributable to equity holders of the
parent*
Loss for the purposes of basic loss and dilutive per share being net loss attributable to equity holders of the
parent - (continuing operations)
Weighted average number of ordinary shares
Weighted average number of ordinary shares for the purposes of basic
and dilutive loss per share*
Loss for the purposes of basic loss and dilutive per share being net loss
attributable to equity holders of the parent - (continuing operations)
2012
US$’000
(27,271)
2011
US$’000
(9,195)
(21,050)
(10,096)
2012
000’s
57,959
2011
000’s
48,207
57,959
48,207
*In the current year and prior year the effect of the share options (note 23) were anti-dilu-
tive as the share options were out of the money.
2012 Group
11. Property, plant and equipment
Freehold land
and
buildings
US$’000
Long leashold
land and
buildings
US$’000
Cost or valuation
At 1 September 2011
Additions in year
Disposals in year
Assets Written Off
Revaluation
Reclassified to assets held for sale
Balance at 31 August 2012
Accumulated depreciation
At 1 September 2011
Disposals in year
Depreciation written back on
revaluation
Depreciation charge for the year
Reclassified to assets held for sale
Balance at 31 august 2012
Carrying amounts
At 31 August 2012
At 31 August 2011
Page 44
21,258
727
-
-
273
-
22,258
(103)
-
363
(392)
-
(132)
22,126
21,155
8,005
2
(8,005)
-
-
(2)
-
-
-
-
-
-
-
-
8,005
Plant and
machinery
US$’000
Motor vehicles
US$’000
Furniture
fixtures and
fittings
US$’000
Total
US$’000
1,329
209
(103)
-
-
-
754
175
(11)
-
-
-
1,435
918
(118)
(295)
-
-
(136)
-
(254)
1,181
1,211
9
-
(218)
-
(504)
414
459
2,603
360
(17)
(179)
-
(63)
2,704
(739)
11
-
(417)
24
(1,175)
1,529
1,864
33,949
1,473
(8,136)
(179)
273
(65)
27,315
(1,255)
20
363
(1,217)
24
(2,065)
25,250
32,694
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
11. Property, plant and equipment (continued)
2011 Group
Cost or valuation
At 1 September 2010
Additions in year
Disposals in year
Fair value adjustment
Revaluation
Effect of movements in foreign
exchange
Reclassified to assets held for sale
Balance at 31 August 2011
Accumulated depreciation
At 1 September 2010
Disposals in year
Depreciation on charge for the year
Reclassified to assets held for sale
Balance at 31 August 2011
Carrying amounts
At 31 August 2011
At 31 August 2010
Freehold
land and
buildings
US$’000
Long
leashold
land and
buildings
US$’000
20,098
8,005
75
-
(250)
2,122
(787)
-
-
-
-
-
-
-
21,258
8,005
(34)
-
(69)
-
(103)
-
-
-
-
-
21,115
20,064
8,005
8,005
Plant and
machinery
US$’000
Motor
vehicles
US$’000
Furniture
fixtures and
fittings
US$’000
Aircraft
US$’000
Total
US$’000
713
632
-
-
-
(34)
-
1,329
(25)
-
(93)
-
(118)
1,211
706
540
309
(81)
-
-
(14)
-
754
(196)
23
(122)
-
(295)
459
344
1,972
650
(3)
-
-
(16)
6,003
-
(575)
(1,000)
-
-
-
(4,428)
2,603
-
(378)
-
(361)
-
(739)
1,864
1594
(587)
-
(390)
977
-
-
-
5416
37,349
1,666
(659)
(1,250)
2,122
(851)
(4,428)
33,949
(1,220)
23
(1,035)
977
(1,255)
32,694
32,363
Page 45
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
11. Property, plant and equipment (continued)
• State of repair and maintenance and quality of fixture
Valuations:
ATdM
and fittings
• Location and size of land.
L o n g l e a s e h o l d l a n d a n d b u i l d i n g s
ATdM was disposed of on 30 September 2011 (see note 9)
In considering the estimated valuation, and the useful lives
of the assets and their estimated residual values, the di-
rectors determined that a more prudent assessment of fair
which included the leasehold land and buildings. In the pri-
value should include a set-off in respect of the net book val-
or year the long leasehold land and buildings was included
ue of the refurbishment completed in 2010. The net effect
at the Directors’ valuation at 31 August 2010. The Directors
is that land and buildings are recorded at US$17,300 thou-
obtained evidence of observable prices in an active market
sand. The Directors consider the fair value at the reporting
to determine their valuation. The Directors considered the
date to not be materially different from the carrying value.
fair value at the reporting date to not be materially differ-
The change in the fair value has been recorded in the reval-
ent from the carrying value. Leasehold Land and buildings
uation reserve.
were disposed of on 30 September 2011.
Paynet
Medalspot
R e v a l u a t i o n – p r o p e r t y
An external, professional and independent valuer with ap-
R e v a l u a t i o n – p r o p e r t y
An external, professional and independent valuer with ap-
propriate and recognised qualifications T.W.R.E Zimbabwe
propriate and recognised qualifications, T.W.R.E Zimbabwe
(Pvt) Limited carried out a valuation of the property as at
(Pvt) Limited, carried out a valuation of the freehold land
31 August 2012. Fair value at 31 August 2012 US$2,200
and buildings as at 31 August 2012. Fair value at 31 August
thousand (2011: US$2,200 thousand) was made by refer-
2012 of US$1,900 thousand (2011: US$1,750 thousand)
ence to observable market evidence. The Directors consid-
was made by reference to observable market evidence.
er the fair value of other assets at the reporting date to not
The Directors consider the fair value at the reporting date
be materially different from the carrying value. The change
to not be materially different from the carrying value. The
in the fair value of the property has been recorded in the
change in the fair value of the property has been recorded
revaluation reserve.
in the revaluation reserve.
Leopard Rock
R e v a l u a t i o n – l a n d a n d b u i l d i n g s
An external, professional and independent valuer with
Assets held for sale
At 31 August 2012, the Group held assets for sale to the
value of US$40 thousand (2011: US$3,451 thousand) for
sale. This represents the fixtures and fittings assets within
appropriate and recognised qualifications, C K Hollands,
the disposal groups FMNA and CES.
carried out a valuation of the land and buildings as at 31
August 2012 in accordance with the C K Hollands Valuation
Manual and the Real Estate Institute of Zimbabwe Stan-
dards. Fair value at 31 August 2012 of US$18,500 thou-
sand (2011: US$18,500 thousand) was made by reference
to observable market evidence with adjustments made for:
• Age of the property
• Aesthetic quality and accommodation offered
Page 46
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
11. Property, plant and equipment (continued)
2012 Company
Cost
At 1 September 2011
Additions in year
Balance at 31 August 2012
Accumulated depreciation
At 1 September 2011
Depreciation charge for the year
Balance at 31 august 2012
Carrying amounts
At 31 August 2012
At 31 August 2011
2011 Company
At 1 September 2010
Additions in year
Balance at 31 August 2011
Accumulated depreciation
At 1 September 2010
Depreciation charge for the year
Balance at 31 August 2011
Carrying amounts
At 31 August 2011
At 31 August 2010
12. Biological assets
Balance at 1 September
Acquired during the year
Increase due to births
Loss due to deaths
Loss on fair valuation during the year
Total
Motor vehicles
US$’000
Furniture fixtures and fittings
US$’000
Total
US$’000
207
36
243
(83)
(77)
(160)
83
124
21
21
42
(9)
(19)
(28)
14
12
228
57
285
(92)
(96)
(118)
97
136
Motor vehicles
US$’000
Furniture fixtures and fittings
US$’000
Total
US$’000
60
147
207
(24)
(59)
(83)
124
36
8
13
21
(4)
(5)
(9)
12
4
68
160
228
(28)
(64)
(92)
136
40
Group 2012
Group 2011
US$’000
US$’000
82
3
5
(7)
-
83
69
-
2
(6)
17
82
Biological assets which consist of 267 (2011: 286) living animals for game viewing at the
Leopard Rock Hotel are valued in with the assistance of African Wildlife Management and
Conservation and their values are deemed as acceptable.
Page 47
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
As at 31 August 2012, the consolidated statement of financial position included goodwill of US$717 thousand. Goodwill is
13. Goodwill
allocated to the Group’s cash-generating units (“CGUs”), or groups of cash-generating units, that are expected to benefit
from the synergies of the business combination that gave rise to the goodwill as follows:
Cash generating unit
(CGU)
Original Cost
Cost at 1
September 2011
Carrying value at
1 September 2011
Accelerated
write-off
Carrying value at
31 August 2012
Payent
Celsys
FMNA
ATM
Total
US$’000
US$’000
US$’000
US$’000
717
6,779
584
240
8,320
717
6,779
584
240
8,320
717
6,779
584
-
8,080
-
(6,779)
(584)
-
(7,363)
US$’000
717
-
-
-
717
Estimates and judgements
During the period, the Directors assessed that it would be
appropriate, given the results of the affected operations to
date, that it would be appropriate to impair the carrying
value of goodwill as follows:
to discount rates, growth rates, expected changes in
selling prices and direct costs
• The cash flow projections have been discounted using
rates based on the Group’s pre-tax weighted average
cost of capital. The rate used was 15%.
•
Celsys goodwill of US$6,779 thousand is fully im-
• The growth rates applied in the value in use calcu-
paired, as the directors do not consider the signif-
icant goodwill carried at 1 September 2011 reflects
the true value of the shareholding
•
ForgetMeNot Africa (BVI) Limited goodwill of
US$584 thousand is fully impaired. This impair-
ment is consistent with the agreement of sale exe-
cuted for this entity on 14 February 2013
•
Paynet – the directors assessed that no impairment
is required.
The following assumptions are held in the assessment on
the impairment or otherwise of goodwill
• Growth rates are based on a range of growth rates
that reflect the products, industries and countries in
which the relevant CGU or group of CGUs operate.
Growth rates have been calculated based on manage-
ment’s expected forecast volumes and market share
increases on normalisation of the Zimbabwean econ-
omy.
• The key assumptions on which the cash flow projec-
tions for the most recent forecast are based relate
Page 48
lations for goodwill allocated to each of the CGUs or
groups of CGUs that is significant to the total carrying
amount of goodwill were in a range between 0% and
5%.
• Changes in selling price and direct costs are based on
past results and expectations of future changes in the
market.
• In respect of the value in use calculations, cash flows
have been considered for both the conservative and
the full forecast potential of future cash-flows with
no impact to the valuation of goodwill.
Impairment loss
The Group tests goodwill annually for impairment, or more
frequently if there are indications that goodwill might be im-
paired.
The Directors believe that the value of the Group’s invest-
ments are long term and will only be realised on the eventual
full recovery of the Zimbabwean economy. The Directors do
not believe any further impairment to goodwill is necessary.
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
14. Intangible assets
Leopard Rock Hotel Brand Name
Leopard Rock Hotel Casino Licence
Payserv software licences
Sol Aviation Licence
Non-Compete Agreement
FMNA Software Licence
Total
Amortisation
Original Cost
US$’000
Cost at 1
September 2011
US$’000
Amortisation
US$’000
Accelerated
write-off
US$’000
Closing balance
at 31 August
2012
US$’000
1,129
1,000
1,425
405
14,854
1,081
19,894
873
544
655
-
3,792
961
6,825
(115)
(198)
(208)
-
(1,325)
(173)
(2,019)
-
-
-
-
(2,467)
(788)
(3,255)
758
346
447
-
-
-
1,551
The amortisation charge is recognised within administration expenses (note 5) in the income statement. The remaining
amortisation period at 31 August 2012 is 21-79 months for other intangibles.
The Group tests other intangible assets for impairment if there are indications that they might be impaired.
The amortisation periods for other intangible assets are:
- Non compete agreement
5.5 years
- Licences
- Brand names
Non-compete agreement
5-6 years
9 years
The agreement, entered into on the listing of Cambria Africa Plc on the Aim in December 2007, covered a period of five and
a half years and under its terms, without the express permission of Cambria Africa Plc, Lonrho Plc was not permitted to;
• invest in, carry on or be engaged or in any way be interested in any competing business of Cambria which was carried
on in Zimbabwe or the Beira Corridor;
• provide any of the services provided to any other organization competing in Zimbabwe or the Beira Corridor;
• induce or assist any other person or company to do any of the things that Lonrho itself was prohibited from.
The non-compete agreement was originally recognised as an intangible asset valued at USS14,854 thousand (£7,290 thou-
sand) being the value of the shares issued. It was deemed impractical to use any other basis for the valuation.
Following the resignation of the Directors of Lonrho from the Board of Cambria on 24 February 2012, the Directors deemed
it appropriate to write-off of the remaining Intangible at that date.
Page 49
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
15. Long-term receivables
Group 2012
US$’000
Company 2012
US$’000
Group 2011
US$’000
Company 2011
US$’000
ATDM Sale Proceeds
ATDM Shareholder Loan account
Total
3,145
84
3,229
3,145
84
3,229
-
-
-
-
-
-
The proceeds on sale of shares of Aldeamento Turistico de Macuti SARL (“ATDM”) on 30 September 2011 are receivable
over a period of 60 months. At 31 August 2012 US$4,165 thousand was receivable of which US$1,020 thousand is receiv-
able within the forthcoming 12 months, the remaining US$3,145 thousand is due after 12 months.
The Group’s Loan to ATDM at the date of sale, is repayable over a period of 24 months. At 31 August 2012 US$365 thousand
was receivable, of which US$280 thousand is due within the forthcoming 12 months, the remaining US$85 thousand is due
after 12 months.
The Company has investments in the following subsidiaries which principally affected the profits or net assets of the Com-
16. Investments in subsidiaries and associates
pany.
The direct investments in subsidiaries held by the Company are stated at cost. This is subject to impairment testing.
Country of incorporation
Ownership interest
LonZim Holdings Limited +
Aldeamento Turistico de Macuti SARL #
Autopay (Pvt) Limited
Celsys Limited
Chenyakwaremba Farm (Pvt) Limited
Diospyros Investments (Pvt) Limited ++
Eastingteg Investments (Pvt) Ltd
Isle of Man
Mozambique
Zimbabwe
Zimbabwe
Zimbabwe
Zimbabwe
Zimbabwe
ForgetMeNot Africa (BVI) Limited ++
British Virgnin Islands
Gardoserve (Pvt) Limited
Le Har (Pvt) Limited
Leopard Rock Hotel Company (Pvt) Limited
LonZim Air (BVI) Limited
Medalspot (Pvt) Limited
Panafmed (Pty) Limited
Paynet Limited
Paynet Zimbabwe (Pvt) Limited
Rex Mining Holdings (Pvt) Limited
Tradanet (Pvt) Limited
Zimbabwe
Zimbabwe
Zimbabwe
British Virgnin Islands
Zimbabwe
South Africa
Mauritius
Zimbabwe
Zimbabwe
Zimbabwe
Page 50
2012
100%
0%
100%
60%
100%
100%
100%
51%
100%
100%
100%
100%
100%
51%
100%
100%
100%
51%
2011
100%
80%
100%
60%
100%
100%
0%
51%
100%
100%
100%
100%
100%
51%
100%
100%
100%
51%
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
16. Investments in subsidiaries (continued)
+ Held directly by Cambria Africa Plc.
++ Held for Sale
Summary of investments which are not significant to the Group either in terms of revenues or assets are tabled below.
Country of incorporation
Ownership interest
African Solutions Limited
Blueberry International Services Limited
Blueberry Print (Zambia) Limited
Celsys Zambia Limited #
First Food Enterprises (Pvt) Limited #
ForgetMeNot Nigeria Ltd
Lanuarna Enterprises (Pvt) Limited
Linus Business Options (Pvt) Limited
Lonrho Properties Zimbabwe Limited
LonZim Agribusiness (BVI) Limited
LonZim Enterprises Limited
LonZim Hotels Limited
LonZim Properties Limited
Lyons Africa Holdings BV
Lyons Africa Holdings Limited
Morningdale Properties Limited
Para Meter Computers (Pvt) Limited
Peak Mine (Pvt) Limited
Quickvest525 (Pty) Ltd
Southern Africa Management Services
Wardlaw (1989) Limited
W S Foods (Pty) Limited
Sol Aviation (Pvt) Limited #
Yellowwood Projects (Pvt) Limited *
Mauritius
British Virgnin Islands
British Virgnin Islands
Zambia
Zimbabwe
Nigeria
Zimbabwe
Zimbabwe
Zimbabwe
British Virgnin Islands
United Kingdom
Isle of Man
Isle of Man
The Netherlands
England and Wales
Zimbabwe
Zimbabwe
Zimbabwe
South Africa
Mauritius
United Kingdom
South Africa
Zimbabwe
Zimbabwe
* Previously Lonrho Properties Zimbabwe (Pvt) Limited
# Subsidiaries disposed in the year
2012
100%
100%
100%
0%
0%
51%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
0%
100%
2011
100%
100%
100%
55%
100%
51%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
90%
100%
ALDEAMENTO TURISTICO DE MACUTI SARL (“ATDM”)
Disposal of Subsidiaries
On 30 September 2011, Cambria disposed of its entire shareholding of 80% of the issued Share Capital of ATDM for US$5,100
thousand to Lonrho Hotels (Holdings) Limited, a 100% subsidiary of Lonrho Plc. At date Lonrho Plc held 22.92% of Cambria
Africa Plc. Proceeds from the sale are being received in cash, over 60 equal monthly instalments. Cambria’s shareholder loan at
the date of sale, of US$1million is being settled in cash over 24 equal monthly instalments. Both receivables accrue interest at
7% of the outstanding balance.
Page 51
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
16. Investments in subsidiaries (continued)
CELSYS ZAMBIA LIMITED (“Celsys Zambia”)
Incorporated on 17 April 2009, the Group’s 55% shareholding in Celsys Zambia was disposed of for a consideration of US$51
thousand on 19 September 2011. Proceeds on sale of US$257 thousand included the settlement of the Group’s shareholder
loan, net of capitalised intercompany interest of US$206 thousand. Profit on disposal, after the write-off of interest on the
shareholder loan was US$13 thousand.
SOL AVIATION PRIVATE LIMITED (“Sol Aviation”)
The group acquired 90% of the issued share capital of Sol Aviation on 13 January 2009. The negative goodwill on acquisition
was immediately released to operating income. Then on 26 August 2011, the Group disposed of its investment in Sol Aviation
for nil consideration. Costs incurred on disposal amounted to US$90 thousand.
FIRST FOOD ENTERPRISES (PRIVATE) LIMITED (“FIRST FOOD”)
Acquired on 29 April 2009 as part of the acquisition of the Leopard Rock Hotel Group, First Food was a dormant entity, which
held no assets and liabilities. First Food was sold on 4 July 2012 for a consideration of US$5 thousand.
17. Inventory
Raw Materials and Consumables
Work in Progress
Goods in Transit
Finished Goods
Total
18. Other investments
Quoted investments portfolio
Option to purchase the Castle at the Leopard Rock Hotel
Total
Quoted investments portfolio:
Balance at 1 September
Acquired during the year
Disposed during the year
(Loss) / gain on fair valuation during the year
At end of the year
Page 52
Group 2012
Group 2011
US$’000
US$’000
462
6
129
339
936
281
106
159
186
732
Group 2012
Group 2011
US$’000
US$’000
42
-
42
49
60
109
Group 2012
Group 2011
US$’000
US$’000
49
3
(3)
(7)
42
75
5
(44)
13
49
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
18. Other investments (continued)
Option to purchase the Castle at the Leopard Rock Hotel:
Purchase option
Balance at 1 September
Option acquired to Purchase the Castle at the Leopard Rock Hotel
Option exercised in the period
At end of the year
Total other investments at 31 August
Group 2012
Group 2011
US$’000
US$’000
60
-
(60)
-
42
-
60
60
109
The portfolio is managed by an asset management company who make the decisions regarding the sale and purchase of
shares. This investment is held at fair value. During the period, the Group exercised its option to acquire the Castle alongside
the Leopard Rock Hotel through its subsidiary Eastinteg Investments (Pvt) Limited.
19. Trade and other receivables
Note
Group
2012
US$’000
Amounts owed by Group
undertakings
Trade receivables
Other receivables
ATDM sale proceeds – cur-
rent portion
ATDM shareholder loan
account – current portion
Pre-payments and accrued
income
Total
-
960
89
1.020
280
276
15
15
Company
2012
US$’000
23,291
-
77
1,020
280
-
Group
2011
US$’000
-
2,664
1,763
-
-
87
Company
2011
US$’000
38,115
-
597
-
-
-
2,625
24,668
4,514
38,712
The average credit period taken on sales of goods is 84 days. No interest is charged on receivables.
The Directors consider the carrying amount of trade and other receivables approximates their fair value. In determining the
recoverability of the trade receivable, the Group considers any change in the credit quality of trade receivables from the date
credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base
being large and unrelated. Accordingly, the Directors believe that there is no further credit provision required in excess of
the allowance for doubtful debts.
On 31 October 2008, the Group entered into an unsecured long-term facility agreement with Churchill Estates (1995) Pvt
Limited. The principle of US$1,000 thousand and related interest at a coupon rate of 15% per annum is receivable on 31
October 2013. Interest of US$300 thousand and the loan principle was recognised to 31 August 2011 in trade and other re-
ceivables. At 31 August 2012, the loan and interest total of US$1,300 thousand has been fully impaired due to uncertainty
over the recoverability of the receivable.
At 31 August 2012, US$38,415 thousand is due to the Company from Lonzim Holdings. The assets and liabilities of Lonzim
Holdings are comprised of inter-group balances. As a result, the level of the balance due from Lonzim Holdings that is
Page 53
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
19. Trade and other receivables (continued)
deemed to be recoverable is limited to the net assets of the group, which are US$23,291 thousand at 31 August 2012. The
impairment of US$15,160 thousand has been taken to the Company’s statement of comprehensive income, this amount
eliminates on consolidation therefore does not affect Group figures.
Credit risk
The Group’s credit risk is primarily attributable to its trade receivables. The amounts presented in the statement of financial
position are net of allowances for doubtful receivables. An allowance for impairment is made where there is an identified
loss event which, based on previous experience, is evidence of a reaction in the recoverability of the cashflows.
20. Cash and cash equivalentsGroup
2012
US$’000
Bank balances
Bank overdrafts
Net Cash and cash
equivalents
468
(337)
131
Company
2012
US$’000
178
-
178
Group
2011
US$’000
1,076
(47)
1,029
Company
2011
US$’000
597
-
597
Revaluation reserve
21. Capital and reserves
The revaluation reserve relates to property, plant and equipment which has been revalued in the Zimbabwean subsidiaries
Celsys, Paynet, Leopard Rock Hotel, Millchem and Medalspot and in the prior period, additionally the leasehold land in Beira
(ATDM).
Foreign exchange reserve
This reserve arises on translation of subsidiaries entities where their functional currency is not United States Dollars, the
presentational currency of the Group. The Company foreign exchange currency reserve relates to the translation of net asset
due to a change in the functional currency of the Company from Pounds Sterling to United as at 1 September 2011.
Share based payment reserve
The share based payment reserve comprises of the charges arising from the calculation of the share based payment posted
to the income statement in 2008 and 2012, restated to US$ at closing rates. (see note 19).
Non distributable reserve
Amounts held within this reserve are ring fenced from retained earnings. Distributions can only be made from retained earn-
ings and not from the non distributable reserve. Amounts transferred to the non distributable reserve are determined by the
directors as necessary, unless specifically required to do so as part of any financing arrangements.
Page 54
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
22. Share capital & share premium
Authorised
Ordinary $0.0001 shares
Issued fully paid
At 1 September 2011
Issued in period
At 31 August 2011
Ordinary shares
2012
Ordinary shares
2011
Number
US$’000
Number
US$’000
58,133,908
10
54,145,469
54,145,469
3,988,439
58,133,908
10
36,331,525
1
17,813,944
11
54,145,469
10
7
3
10
The Group has also issued share options (see note 23). At 31 August 2012, 1,500,000 shares were held in reserve to issue in
the event that these options are exercised. At 10 December 2012, 500,000 unutilised share options expired and were not
renewed.
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one vote
per share at meetings of the Company. All shares rank equally with regard to the Company’s residual assets.
The Directors are authorised in any period between consecutive annual general meetings, to allot any number of ordinary
shares on such terms as they shall, in their discretion, determine up to such maximum number as represents 50 per cent of
the issued share capital at the beginning of such period. Further ordinary shares may be allotted on terms determined by the
Directors but subject to the pre-emption rights prescribed by Section 36 of the Isle of Man Companies Act 2006.
Share Premium
The share premium represents the value of the premium arising on the share issue on 16 Sept 2011 of 3,988,439 ordinary
shares at a price of 0.23p ($1,448 thousand) and plus previous share issues as follows:
• 10 Dec 2012
17,813,944 ordinary shares at a price of 0.28p per share net of issue costs
of £143 thousand (US$7,646 thousand).
• 09 Dec 2009
4,255,525 ordinary shares at a price of 27.5p per share net of issue costs of
£58 thousand ($1,820 thousand).
• 11 Dec 2007
36,450,000 ordinary shares at a price of £1.00 per share net of issue costs of
£2,753 thousand ($68,659 thousand). Less:
• 14 July 2009
the cost of purchasing and cancelling 4,374,000 shares at 30.5p per share
($2,174 thousand).
The following share options over ordinary shares were granted under an Unapproved Share Option scheme.
23. Share options
Page 55
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
23. Share options (continued)
Name
Date of grant
Paul Heber
11.12.2007
Edzo Wisman 10.03.2011
Edzo Wisman 10.03.2011
Number of
share options
granted
500,000
500,000
500,000
Exercise price
Peroid during which exercisable
150p
30p
30p
11.12.2007 - 10.12.2012
01.07.2011 – 30.06.2016
01.07.2012 – 30.06.2017
Market price per share
at date of grant
100p
21.75p
21.75p
In accordance with IFRS 2 ‘Share-based payments’ the equity settled share options granted have been measured at fair value
and recognised as an expense in the income statement with a corresponding increase in equity (other reserves). The fair
value of the options granted has been estimated at the date of grant using the Black-Scholes option-price in model. The
estimated value of the options granted on 11 December 2007 was £165 thousand (US$270 thousand). The estimated value
of the options granted on 10 March 2011 was £53 thousand (US$85 thousand).
Options may be exercised in whole or in part until the expiry of the exercise period. Holders of the options are entitled to
receive notice of certain proposed transactions or events of the Company which may dilute or otherwise affect their options,
and may exercise or be deemed to have exercised their options prior to the occurrence thereof. The Company shall keep
available sufficient authorised but unissued share capital to satisfy the exercise of the options. Ordinary Shares issued pur-
suant to an exercise of the options shall rank pari passu in all respects with the Company’s existing Ordinary Shares save as
regards any rights attaching by reference to a record date prior to the receipt by the Company of the notice of exercise of
options. The Company shall apply to admit to trading on AIM the Ordinary Shares issued pursuant to the exercise of options.
The following assumptions have been used:
Number of shares
Share price at vesting date
(Date of Grant)
Exercise price
Expected volatility
Expected life
Expected dividends
Risk-free interest rate
Date grant
10 March 2011
5000,000
21.75p
30p
30.2%
5.4 years
0.00%
5.00%
Date of grant
10 March 2011
Date of grant
11 December 2007
500,000
21.75p
30p
30.2%
6.4 years
0.00%
5.00%
500,000
100p
150p
44%
5 years
0.00%
5.00%
Volatility has been calculated by reference to industry indices at vesting dates.
All share options vested at date of grant and the basis of settlement is in shares of the company.
Share Options which expired on 10 December 2012, have not, as of the date of the report been renewed.
The number and weighted average exercise price of share options are as follows:
Page 56
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
23. Share options (continued)
2012
Weighted average exercise price pence
Number of options
Exercisable at 1 September 2011
Outstanding at 31 August 2012
Exercisable at 31 August 2012
150
70
70
24. Loans and Borrowings Group
2012
US$’000
Consilium Facility
Other Trade Payables
Total
2,000
54
2,054
Company
2012
US$’000
2,000
-
2,000
Group
2011
US$’000
-
-
-
500,000
1,500,000
1,500,000
Company
2011
US$’000
-
-
-
Long term payables are in respect of secured loan facility agreements which the Company entered into on 9 March 2012,
with Consilium Emerging Markets Absolute Return Master Fund Ltd. and Consilium Corporate Recovery Master Fund Ltd. for
US$1,000 thousand and US$2,000 thousand respectively (“Consilium”).
The credit facilities bear interest at 15% per annum and are repayable as follows: the US$1,000 thousand on 31 December
2012 and the US$2,000 thousand facility on 8 March 2014 (see note 27).
The amounts are secured by a fixed and floating charge over the assets the Group. On 6 December 2012 the Debenture was
lifted and in lieu thereof, the Company agreed to issue Consilium with a Warrant for 3,000,000 ordinary shares at 13p per
share, expiring on 6 December 2015 (see note 37).
In the event of default, Consilium shall have the option to convert all, or any portion of the outstanding indebtedness at the
time of default into shares in Cambria at a 15% discount to the share price at the date of the facility agreements or 14.05p
(see note 37).
On 9 October 2012, US$250 thousand of the US$1,000 thousand facility maturing on 31 December 2013 was repaid, and on
28 November 2012, the remaining US$750 thousand was rolled over, and will mature on 8 March 2014 (see note 37).
The Consilium Corporate Recovery Master Fund Ltd and Consilium Emerging Markets Absolute Return Master Fund Ltd.
share the same investment manager as Consilium Emerging Market Absolute Return Master Fund Ltd., a substantial share-
holder of Cambria, and the transaction is therefore deemed a related party transaction for the purpose of the AIM Rules for
Companies.
Other non-current Trade Payables are in respect of historic Paywell software licence fees with the Payserv Group, which could
not be remitted due to Zimbabwe Exchange Regulations. The amounts due were invested in a listed portfolio (see note 18).
Page 57
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
25. Provisions
ATDM
Other provisions
Total
Group
2012
US$’000
--
161
161
Company
2012
US$’000
-
-
-
Group
2011
US$’000
1,050
-
1,050
Company
2011
US$’000
1,050
-
1,050
Provisions at 31 August 2012, are in respect of Leave Pay and Gratuities, which are payable by individual companies on
termination of employment.
Provisions at 31 August 2011, relate to an ‘alienation’ agreement with the Mozambique Government which was assumed
as part of the consideration for the acquisition of Aldeamento Turistico de Macuti SARL on 11 June 2008. The provision was
for US$1,500 thousand. The amount payable by Cambria Africa Plc was capped at US$1,500 thousand and was expected to
be settled no earlier than 36 months from 31 August 2011. At that stage, the Directors were of the opinion that there was
70% probability that this liability would become due and the liability was adjusted to reflect this.
At 30 September 2011, the investment in subsidiary was sold (see note 16) thus releasing this provision.
Recognised deferred liability
26. Deferred tax liability
The following are the major deferred tax liabilities recognised by the Group and movements thereon during the current
year.
G r o u p
At 1 September
Other movements
At 31 August
2 0 1 2
Accelerated tax
depreciation
US$’000
1269
2839
4108
2 0 1 1
Accelerated tax
depreciation
US$’000
1524
(255)
1269
Total
US$’000
1269
2839
4108
Total
US$’000
1524
(255)
1269
Deferred tax assets off set against deferred tax liabilities in the period were US$44 thousand (2011:US$nill)
Recognised deferred assets
The following are the major deferred tax assets recognised by the Group and movements thereon during the current year.
G r o u p
(Released)\recognised in year in respect of current trading
losses
Accelerated tax
2 0 1 2
depreciation
US$’000
-
Total
US$’000
-
Accelerated tax
2 0 1 1
depreciation
US$’000
245
Total
US$’000
245
Page 58
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
26. Deferred tax liability (continued)
Derecognised
Recognised directly in reserves
At 31 August
27. Loans and borrowings
Consilium
Purchase of castle
Total
(1,305)
(1,305)
-
-
Group
2012
US$’000
1,250
442
1,692
Company
2012
US$’000
1,250
-
1,250
-
4
1,305
Group
2011
US$’000
1500
-
1500
-
4
1,305
Company
2011
US$’000
1500
-
1500
At 31 August 2012, short term loans of the Company represent the long term portion of the Consilium loans of US$1,000
thousand (see note 24), which mature on 31 December 2012.
On 25 July 2012, the Company entered into a short term loan agreement with Consilium for us$250 thousand. The facility
matures on 25 October 2012 and bears interest at 17% per annum, repayable at the end of the term. The Loan is secured
over cash sales and trade receivables of Gardoserve (Pvt) Limited.
On 9 October 2012, the US$250 thousand short term facility was rolled over on the same terms and conditions as the
US$2,000 thousand Consilium facility and will mature on 8 March 2014.
On 14 March 2012, the Group completed the acquisition of the Castle at Leopard Rock Hotel for EUR550 thousand (US$722
thousand). EUR200 thousand was paid on execution of the agreement and the balance EUR350 thousand (US$442 thou-
sand) is due on 31 March 2013. The loan bears interest at 17.14% and is repayable monthly.
The balance at 31 August 2011 is in respect of a facility arrangement with EcoBank Zimbabwe Limited, which was secured
by immovable property held by Medalspot (Pvt) Limited and Le Har (Pvt) Limited. The loan, which bore interest at a rate of
20% per annum was repaid on 21 March 2012.
28. Trade and other Payables
Trade payables
Non-trade payables and accrued expenses
Total
Group
2012
US$’000
1,534
1,291
2,825
Company
2012
US$’000
-
1,250
1,250
Group
2011
US$’000
1,228
1,451
2,679
Company
2011
US$’000
-
335
335
Trade payables and accruals principally comprise amounts outstanding for trade purchases and on-going costs. The average
credit period taken for trade purposes is 121 days.
The Directors consider that the carrying amount of trade payables approximates to their fair value.
Page 59
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
29. Notes to the statement of cash flows
Loss for the year
Amortisation of intangible assets
Impairment of goodwill
Depreciation of property, plant and equipement
Finance income
Finance costs
Share based payment reserve
Fair value adjustment of property, plant and equipment
Fair value adjustment of intangibles
Impairment of Current Assets
Gain on write-off of non Group shareholder loan
Loss on sale of property, plant and equipment
Decrease in provisions
Foreign exchange
Gains on investment
Operating cash flows before movements in working
capital
Increase in inventories
Decrease / (increase) in receivables
(Decrease) / increase in payables
Cash used in operations
Interest paid
Interest received
Dividends paid
Tax paid
Net cash used in operating activities
Group
2012
US$’000
(25,688)
2,019
7,363
1,217
(312)
674
85
-
3,428
3,301
(863)
3,243
(889)
507
7
(5,908)
(204)
(1,751)
(71)
(7,934)
(707)
326
(323)
(509)
(9,147)
2011
US$’000
(10,175)
3,045
-
1,035
(299)
963
-
1,250
314
-
-
(483)
-
(1,078)
(13)
(5,441)
(260)
265
(240)
(5,676)
(241)
299
-
-
(5,617)
Cash and cash equivalents (which are presented as a single class of assets on the face of the statements of financial posi-
tion) comprise cash at bank, overdraft and other short term highly liquid investments with a maturity of three months or
less.
The Group has exposure to the following risks from its use of financial instruments:
30. Financial instruments
• credit risk
• liquidity risk
• market risk (comprises: foreign currency risk and interest rate risk)
Page 60
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and
processes for measuring and managing risk, and the Group’s management of capital. Further quantitative disclosures are
included throughout these consolidated financial statements. The Board of Directors has overall responsibility for the
establishment and oversight of the Group’s risk management framework.
Risk management framework
The Company’s Board of Directors has overall responsibility for the establishment and oversight of the Group’s risk manage-
ment framework. The Group’s risk management policies are established to identify and analyse the risks faced by the Group,
to set appropriate risk limits and controls, and to monitor risks and adherence to limits. The Group’s risk management pol-
icies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and controls, and to
monitor risks and adherence to limits.
Credit risk management
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the
Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral
where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group’s exposure and the credit rat-
ings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst
approved counterparties.
Trade receivables consist of a large number of customers, spread across diverse industries and geographical areas. Ongoing
credit evaluation is performed on the financial condition of accounts receivable and, where appropriate, credit guarantee
insurance cover is purchased. The Group does not have any significant credit risk exposure to any single counterparty or any
group of counterparties having similar characteristics. The credit risk on liquid funds and derivative financial instruments is
limited because the counterparties are banks with high credit- ratings assigned by international credit rating agencies.
The carrying amount of financial assets recorded in the financial statements, net of any allowances for losses, represents the
Group’s maximum exposure to credit risk without taking account of the value of any collateral obtained. At the reporting
date, there were no significant credit risks.
Exposure to credit risk
The carrying amount of financial assets represents the maximum credit exposure. Therefore, the Group’s maximum expo-
sure to credit risk at the reporting date was US$ 5,931 thousand (2011: US$ 5,456 thousand) and the Company’s maximum
exposure to credit risk at the reporting date was US$ 28,075 thousand (2011: US$ 39,309 thousand) being the total of the
carrying amount of financial assets, excluding equity investments as shown in the table below.
Cash and cash equivalents
Trade and other receivables
Other investments
Group
2012
US$’000
131
5,579
42
Company
2012
US$’000
178
27,897
-
Group
2011
US$’000
1,029
4,427
109
Company
2011
US$’000
597
38,712
-
Page 61
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Total
Group
2012
US$’000
5,752
Company
2012
US$’000
28,075
Group
2011
US$’000
5,565
Company
2011
US$’000
39,309
The maximum exposure to credit risk for trade and other receivables at the reporting date by geographic region was:
United Kingdom
Zimbabwe
East Africa
Total
Group
2012
US$’000
4,529
1,050
-
5,579
Company
2012
US$’000
27,897
-
-
27,897
Group
2011
US$’000
-
2,721
1,706
4,427
Company
2011
US$’000
38,712
-
-
38,712
The maximum exposure to credit risk for trade and other receivables at the reporting date by type of counterparty was:
Trade Customers
Sale of Investment Proceeds (note 15)
Amounts owed by Group undertakings
Total
Gross
2012
US$’000
1,050
4,529
-
5,579
Company
2012
US$’000
77
4,529
23,291
27,897
Group
2011
US$’000
4,427
-
-
4,427
Company
2011
US$’000
597
-
38,115
38,717
The ageing of trade and other receivables at the reporting date was:
Gross
2012
US$’000
G r o u p
Impairment
2012
US$’000
Total
2012
US$’000
Neither past nor impaired
Past due 1-30 days
Past due 31-60 days
Past due 61-90 days
Past due 91-days +
Total
896
217
31
18
135
1,297
-
(86)
(31)
(18)
(135)
(270)
Page 62
Gross
2012
US$’000
Impairment
C o m p a n y
2012
US$’000
43,057
(15,160)
Total
2012
US$’000
27,897
-
-
-
-
-
-
-
-
-
-
-
-
896
131
-
-
-
1,027
43,057
(15,160)
27,897
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Based on the Group’s monitoring of customer credit risk, the Group believes that, except as indicated above, no impair-
ment allowance is necessary in respect of trade receivables not past due.
Liquidity risk management
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabil-
ities that are settled by delivering cash and another financial asset.
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has built an appropriate
liquidity risk management framework for the management of the Group’s short, medium and long term funding and liquid-
ity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and
reserve borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles
of financial assets and liabilities.
The following are the contractual undiscounted maturities of financial liabilities, including estimated interest payments and
excluding the effect of netting agreements:
G r o u p
Bank overdrafts
Trade and other payables
Loans and borrowings
Total
C o m p a n y
Bank overdrafts
Trade and other payables
Loans and borrowings
Total
Contractual cash flows 2012
Contractual cash flows 2011
1 year or
less
US$’000
337
2,825
1,692
4,854
1 to < 5
years
US$’000
-
-
2,054
2,054
Carring
amount
US$’000
1 year or
less
US$’000
1 to < 5
years
US$’000
47
2,676
1,500
47
2,679
1,500
4,226
4,226
-
-
-
-
Contractual cash flows 2012
Contractual cash flows 2011
1 year or
less
US$’000
-
1,250
1.250
2,500
1 to < 5
years
US$’000
-
-
2,000
2,000
Carring
amount
US$’000
1 year or
less
US$’000
1 to < 5
years
US$’000
-
335
1,500
-
335
1,500
1,835
1,835
-
-
-
-
Carrying
amount
US$’000
337
2,825
3,746
6,908
Carrying
amount
US$’000
-
1,250
3,250
4,500
Page 63
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Liquidity risk management (continued)
As disclosed in note 24 Loans and borrowings are in respect of secured loan facility agreements which the Company
entered into on 9 March 2012, with Consilium Emerging Markets Absolute Return Master Fund Ltd. and Consilium
Corporate Recovery Master Fund Ltd. for US$1,000 thousand and US$2,000 thousand respectively (“Consilium”).
The amounts are secured by a fixed and floating charge over the assets the Group. On 6 December 2012 the Debenture
was lifted and in lieu thereof, the Company agreed to issue Consilium with a Warrant for 3,000,000 ordinary shares at 13p
per share, expiring on 6 December 2015.
In the event of default, Consilium shall have the option to convert all, or any portion of the outstanding indebtedness at
the time of default into shares in Cambria at a 15% discount to the share price at the date of the facility agreements or
£14.05p.
It is not expected that the cash flows included in the maturity analysis will occur significantly earlier, or at significantly
different amounts.
Foreign currency risk management
The Group is exposed to foreign currency risk on sales, purchases and borrowings that are denominated in a currency
other than United States Dollars. The currencies giving rise to this risk are primarily the Pound Sterling, Euro and the South
African Rand. In respect of other monetary assets and liabilities held in currencies other than United States Dollars, the
Group ensures that the net exposure is kept to an acceptable level, by buying or selling foreign currencies at spot rates
where necessary to address short-term imbalances.
The carrying amount of the Group’s foreign currency denominated monetary assets and monetary liabilities at the report-
ing date is as follows:
Cash and cash equivalents
Trade recievables
Other recievables
Trade payables
Other payables
Net Exposure
Mozambican
Meticals
US$’000
Pounds
Sterling
US$’000
Euro
US$’000
South Africa
Rand
US$’000
-
-
-
-
-
-
14
-
-
-
(737)
(723)
1
-
-
-
(439)
(438)
4
-
83
(36)
-
51
The following significant exchange rates applied during the year:
Page 64
Cambria Africa Plc
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Foreign currency risk management (continued)
Pounds Sterling
Euro
South African Rand
Mozambican Meticals
Average Rate
2012
Reporting date
spot rate
2012
Average Rate
2011
Reporting date
spot rate
2011
0.64
0.77
8.31
-
0.63
0.80
8.43
-
0.62
-
7.16
31.56
0.61
-
7.06
26.40
The Company does not have any exposure to foreign currencies at the reporting date (2011: US$nil).
Sensitivity analysis
In managing foreign currency risks the Group aims to reduce the impact of short and long-term fluctuations on the Group’s
earnings. The Directors consider Group’s sensitivity to foreign currency rates isn’t material, as the majority of assets and
liabilities of the Group are denominated in US Dollars with the exception of monetary asset and liabilities disclosed above.
Interest rate risk management
Due to the liquidity constraints in the Zimbabwean economy, and the consequential interest rate risk the Group would be
subject to interest rate risk if it relied soley on short term Zimbabwean sourced borrowings, however, the Company has,
mitigated its risk, by entering into a number of long term, offshore facility agreements with fixed rates of interest.
Additionally the Group has, where possible entered into 1 year fixed interest rate overdraft agreements with its bankers in
Zimbabwe.
The Company and the Group’s exposures to interest rates on financial assets and financial liabilities are detailed in the liquid-
ity risk management section of this note.
The Group’s sensitivity to interest rates is comparatively low due to the long term nature of its facility agreements.
Capital management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and
to sustain future development of the business. The Board of Directors monitors the return on capital, which the Group
defines as net operating income divided by total shareholders’ equity, excluding non-redeemable preference shares and
non-controlling interests. The Board of Directors also monitors the level of dividends to ordinary shareholders.
Fair values
The fair values of financial assets and liabilities, together with the carrying amounts shown in the statement of financial
position are as follows:
Page 65
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Loans and receivables
2012
US$’000
Available for sale
2012
US$’000
Carrying amount
2012
US$’000
Fair value
2012
US$’000
131
5,579
-
(2,825)
(3,746)
(861)
-
-
42
-
-
42
131
5,579
42
(2,825)
(3,746)
(819)
131
5,579
42
(2,825)
(3,746)
(819)
Loans and receivables
2011
US$’000
Available for sale
2011
US$’000
Carrying amount
2011
US$’000
Fair value
2011
US$’000
1,029
4,427
-
(2,679)
(1,500)
1,277
-
-
109
-
-
109
1,029
4,427
109
(2,679)
(1,500)
1,386
Loans and receivables
2012
US$’000
Available for sale
2012
US$’000
Carrying amount
2012
US$’000
178
27,897
-
(1,250)
(3,250)
23,575
-
-
-
-
-
-
178
27,897
-
(1,250)
(3,250)
23,575
1,029
4,427
109
(2,679)
(1,500)
1,386
Fair value
2012
US$’000
178
27,897
-
(1,250)
(3,250)
23,575
G r o u p
Cash and cash equivalents
(net of bank overdraft)
Trade and other recievables
Other investments
Trade and other payables
Loans and borrowings
Total
G r o u p
Cash and cash equivalents
(net of bank overdraft)
Trade and other recievables
Other investments
Trade and other payables
Loans and borrowings
Total
C o m p a n y
Cash and cash equivalents
(net of bank overdraft)
Trade and other recievables
Other investments
Trade and other payables
Loans and borrowings
Total
Page 66
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Fair values (continued)
C o m p a n y
Cash and cash equivalents
(net of bank overdraft)
Trade and other recievables
Other investments
Trade and other payables
Loans and borrowings
Total
Loans and receivables
2011
US$’000
Available for sale
2011
US$’000
Carrying amount
2011
US$’000
597
38,712
-
(355)
(1,500)
37,474
-
-
-
-
-
-
597
38,712
-
(355)
(1,500)
37,474
Fair value
2011
US$’000
597
38,712
-
(335)
(1,500)
37,474
The fair value of assets and liabilities can be classed in three levels.
Level 1 – Fair values measured using quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 – Fair values measured using inputs other than quoted prices included within Level 1 that are observable for the
asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices)
Level 3 – Fair values measured using inputs for the asset or liability that are not based on observable market data (i.e.
unobservable inputs)
As at 31 August 2012, the Company holds the following financial instruments at amortised cost and none at fair value.
However, the Group holds the following investment at fair value:
Quoted investments portfolio
G r o u p
Total
Quoted investments portfolio
G r o u p
Option to purchase the Castle at the Leopard Rock Hotel
Total
Estimation of fair values
Level 1
2012
US$’000
42
42
Level 1
2011
US$’000
49
-
49
Level 2
2012
US$’000
-
-
Level 2
2011
US$’000
-
-
-
Level 3
2012
US$’000
-
-
Level 3
2011
US$’000
-
60
60
Total
2012
US$’000
42
42
Total
2011
US$’000
49
60
109
The following summarises the major methods and assumptions used in estimating the fair values of financial instruments
reflected in the table.
Page 67
Financial Report 2012
Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
30. Financial instruments (continued)
Cash and cash equivalents (net of bank overdraft)
Fair value approximates its carrying amount largely due to the short-term maturities of this instrument.
Loans and borrowings
Fair value is calculated based on discounted expected future principal and interest cash flows.
Trade receivables / payables
For receivables / payables with a remaining life of less than one year, the notional amount is deemed to reflect the fair
value.
Loans and Borrowings
Fair value has been derived from quoted prices.
Other investments
Fair value has been derived from quoted prices.
Leases as lessee
31. Operating leases
At the reporting date, the Group had outstanding annual commitments for future minimum lease payments under
non-cancellable operating leases, which fall due as follows:
Less than one year
2012
-
-
2012
-
-
During the year ended 31 August 2011, US$224 thousand (2011: US$166 thousand) was recognised as an expense in the
income statement in respect of operating leases. Operating lease payments represents rentals payable by the Group for
certain of its properties. Leases are negotiated for a minimum term of 1 year and rentals are fixed for the period.
At the reporting date, the Group had outstanding annual commitments for future minimum lease receipts under non-can-
cellable operating leases, which fall due as follows:
Less than one year
Between one and five years
Total
2012
US$’000
121
426
547
2012
US$’000
447
687
1,134
During the year ended 31 August 2012, US$618 thousand (2011: US$821 thousand) was recognised as revenue in the
income statement in respect of operating leases.
Operating lease receivables at 31 August 2012 represent rentals receivable by the Group for ATM’s. Lease rentals, which
are a combination of fixed and variable rates, are negotiated for an average term of 5 years. Only the fixed portion is dis-
closed in the table as above.
At 31 August 2011, Operating lease receivables represented rentals receivable on the ATM’s, in addition to operating leases
Page 68
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
31. Operating leases (continued)
for aircraft. Aircraft leases are negotiated for an average term of 5 years and rentals are fixed for an average of 5 years. On
7 August 2012, the aircraft under the operating lease agreements were disposed of. (Note 16).
There is no requirement under the Isle of Man Companies Act 2006 to present a company income statement. The loss for
32. Income statement of Cambria Africa Plc
the year to 31 August 2012 was US$22,587 thousand (2011: US$5,676 thousand).
The capital commitments at 31 August 2012 totalled US$nil (2011: US$217 thousand relating to various items of plant and
33. Capital commitments
machinery at Celsys).
During the period the Company entered into the following Guarantees.
34. Guarantees
On 17 May 2012, the Company signed an unsecured guarantee to Kingdom Bank Limited for US$200 thousand, in support
of the US$100 thousand overdraft facility provided to Leopard Rock Hotel Company (Pvt) Ltd, a Group company. The Guar-
antee expires on 16 March 2013.
On 15 June 2012, the Company signed an unsecured guarantee to Kingdom Bank Limited for US$200 thousand, in support
of the US$100 thousand overdraft facility provided to Celsys Limited, a Group company. The Guarantee expires on 14 June
2013.
On 8 June 2012, the Company entered into an unsecured Deed of Guarantee with MEKZ Limited for US$160 thousand,
which expires on 30 June 2014. On 13 January 2013, this guarantee was increased to US$290 thousand. The Guarantee is
in respect of the credit facility which is provided to Gardoserve (Pvt) Limited, a Group company.
On 29 August 2012, the Company entered into an unsecured Deed of Guarantee with Haral Mallac Export Ltd, for US$85
thousand, which expires on 29 August 2013. The Guarantee is in respect of the credit facility which is provided to Gardos-
erve (Pvt) Limited, a Group entity.
Contingent liabilities
35. Contingent liabilities and assets
At the balance sheet date, the Leopard Rock Hotel Company (Pvt) Ltd, a Group company, had 5 open labour cases with the
courts. Total exposure for non-accrued settlement amounts is not anticipated to exceed US$50 thousand.
On 26 August 2011, the Group, pursuant to its disposal of Sol Aviation (Pvt) Ltd, (“Sol Aviation”) entered into a Memoran-
dum of Understanding with the purchaser, whereby the purchaser would be fully indemnified in respect of any claim, made
either by Royal Khmer Airlines International (Pte) Limited (“Royal Khmer”) or Fly540 Aviation Limited (“Fly540”) pursuant
to the Memorandum of Understanding entered into by Sol Aviation and Royal Khmer and a licence agreement entered into
between Sol Aviation and Fly540.
Page 69
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
35. Contingent liabilities and assets (continued)
Entities with significant influence over the entity (continued)
LonZim Air (B.V.I.) Limited
Churchill Estates loan
Total
2012
US$’000
6,991
1,575
8,566
On 16 August 2012, the Group, pursuant to its disposal of
concern, Churchill Estates (1995) Private Ltd (CE). This loan
the scrap remains of an aircraft, indemnified the purchas-
was extended to CE as an unsecured five-year loan, at a
er, against any claims or costs arising in connection with
15% annualised interest rate with principal and interest to
any claim made by 540 (Uganda) Limited against Lonzim
be repaid at the end of the term.
Air (BVI) Limited to a maximum value of US$50 thousand.
There are no other known contingent liabilities at the
balance sheet date.
Contingent assets
At the balance sheet date, the Company has the following
contingent assets
LonZim Air (B.V.I.) Limited
The Board made the decision to impair the loan given the
difficulty to assess the ability of CE to repay the loan due to
the absence of any financial information on CE. However,
the Board will vigorously enforce repayment of this loan by
CE when it is due in October 2013, the Board considered it
at this point prudent to recognise impairment of the value
of this loan as well as any associated accumulated interest.
Cambria owned two aircraft through its subsidiary LonZ-
im Air (B.V.I.) Limited: a Fokker F27-500 Cargo (F27) and
Identity of related parties
36. Related parties
an ATR 42-320 (ATR). The F27 was leased to 540 (Uganda)
The Group has a related party relationship with its subsid-
Limited in September 2008 and the ATR was leased to Five
iaries (see note 16), and with its Directors and executive
Forty Aviation Limited in July 2009. Both entities (collec-
officers and with Lonrho Plc and its subsidiaries.
tively “540”) were, or were understood to be subsidiaries
of Lonrho. A third aircraft leased by 540 was destroyed in
Transactions between the Company and its subsidiaries,
an accident in January 2011.
which are related parties, have been eliminated on consol-
idation and are not disclosed in this note. All related party
Cambria considers that substantial sums are due from 540
transactions are conducted on terms equivalent to arms
which relate to, inter alia, maintenance reserve and lease
length transactions.
charges and related contractual interest payment of insur-
ance proceeds, the deterioration in market value of the air-
craft, and the significantly lower amount the Company was
able to obtain through a sale, due to the poor condition the
aircraft were found to be in.
Churchill Estates loan
Group and Company
Transactions with entities with significant influence over
the entity.
At the date of listing on AIM, 11 December 2007, the Com-
pany issued shares to the value of US$14,854 thousand
During 2008 Cambria, then managed by Lonrho, extend-
(£7,290 thousand) to Lonrho Plc in exchange for Lonrho Plc
ed a loan to what is believed to be a Zimbabwe farming
entering into a non-compete agreement. The agreement
Page 70
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
36. Related parties (continued)
Transactions with entities with significant influence over the entity (continued)
covered a period of five and a half years and had been ini-
able to Directors in respect of Directors Fees : Paul Heber
tially recognised as an intangible asset with a valuation of
US$31 thousand (2011: US$nil), Ian Perkins US$81 thou-
US$14,854 thousand (£7,290 thousand). The book value of
sand (2011: US$nil), Edzo Wisman US$88 thousand (2011:
this intangible asset which was being amortised over the
US$nil).
period of the agreement, is fully written off in the period
(see note 14).
During the period The Group leased two aircraft to 540 (Ugan-
da) Limited, a Lonrho Plc subsidiary, for US$54 thousand per
During the year the Company was charged US$490 thou-
month. Following a runway incident on 27 January 2011,
sand by Lonrho Plc as a management charge (2011: US$862
one of the aircraft was deemed a Total Constructive Loss and
thousand) Other recharges amounted to US$77 thousand
was written off. The total lease income for the year to
(2011: US$183 thousand). As at 31 August 2012 US$200
31 August 2012 amounted to US$345 thousand (2011:
thousand (2011: US$224 thousand) was due from the Com-
US$485 thousand). As at 31 August 2012 amounts due
pany to Lonrho Plc.
from 540 (Uganda) Limited to the Company were fully pro-
vided against. As the Company fully intends to recover the
On 30 September 2011, Cambria sold its 80% sharehold-
monies due, the amounts and are included as contingent
ing in Aldeamento Turistico De Macuti Sarl for US$5,100
asset (see note 35).
thousand to Lonrho Hotels (Holdings) Limited, a 100%
subsidiary of Lonrho Plc (see note 16). During the period
Fly 540 Aviation, a Lonrho Plc subsidiary, received monies
US$1,583 thousand (2011: US$nil) was received in respect
due to Lonzim Air (BVI) Limited, in respect of insurance pro-
of capital and interest payments relating to the sale. At 31
ceeds relating to the aircraft written off on in January 2011.
August US$4,529 thousand (2011: US$nil) was receivable.
As at 31 August 2012 amounts due from Five Forty Avia-
(see note 15 and 19).
tion Limited to the Company were fully provided against.
As the Company fully intends to recover the monies due,
During the year DSG Chartered Accountants, of which Ms
the amounts and are included as contingent asset (see note
Jean Ellis, a director of the Company till 24 February 2012,
35).
provided payroll and accountancy services to the Company
and ForgetMeNot Africa (BVI) Limited (“FMNA”), a Cambria
During the period up to 31 August 2012, Lonrho Hotels
subsidiary. Total services provided in the period under re-
Management Services (“LHMS”), a subsidiary of Lonrho
view to the Group was US$11 thousand (2011: US$19 thou-
Plc provided Management Services to Leopard Rock Hotel
sand). At 31 August 2012, the amount payable to DSG was
Company (Pvt) Ltd (the “Hotel”), a Group company, under
US$nil (2011: US$nil).
contract, fees for which are determined as a percentage of
Turnover and Operating Profit. Management fees for the
During the period Mr Itai Mazaiwana, a director of the
year were US$187 thousand (2011: US$319 thousand).
Company as from 24 February 2012, provided additional
Other recharges from LHMS to the Hotel amounted to
consultancy services to the Company amounting to US$44
US$85 thousand (2011: US$40 thousand). At 31 August
thousand (2011: US$22 thousand) At 31 August 2012, the
2012, the amount payable to LHMS was US$221 thousand
amount payable to Mr Itai Mazaiwana was US$14 thousand
(2011: US$59 thousand).
(2011: US$nil).
At 31 August 2012, the following amounts were pay-
Plc provides freight services and delivery of provisions to
Rollex (Private) Limited (“Rollex”) is a subsidiary of Lonrho
Page 71
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
36. Related parties (continued)
Transactions with entities with signifi-
cant influence over the entity (continued)
the Hotel. Total purchases for the year ended 31 August
ForgetMeNot Software Limited (“FMNS”), the 49% share-
2012 was US$21 thousand (2011: US$3 thousand). At 31
holder in FMNA. provided services and processed recharg-
August 2012, the amount payable to Rollex was US$23
es to FMNA in the period totalling US$191 thousand (2011
thousand (2011: US$2 thousand).
: US$448 thousand).
Global Horizons Ltd T/A as AFEX a subsidiary of Lonrho Plc,
provides satellite landing rights to the Hotel for the provi-
sion of its Internet Services. Total purchases for the year
ended 31 August 2012 was US$58 thousand (2011: US$51
thousand). At 31 August 2012, the amount payable to AFEX
was US$5 thousand (2011: $nil)
Diospyros Investments (Pvt) Limited, trading as CES Zimba-
bwe has a Franchise Agreement with Complete Enterprise
Solutions Mauritius (“CES Mauritius”), a Lonrho Plc Group
company for the use of its proprietary interest trademarks
and brand names, business model and management ex-
pertise. Under the agreement CES Mauritius also provides
working capital support to CES Zimbabwe. During the pe-
riod, under review, CES Zimbabwe paid service charges
of US$38 thousand (2011: Nil). Other interest recharges
amounted to US$16 thousand (2011: Nil). At 31 August
2012, the amount payable to CES Mauritius was US$255
thousand (2011: US$21 thousand). At 31 August 2012 CES
Zimbabwe was held for disposal (see note 9 and16).
Lonrho Africa Holdings Limited (“LAHL”), a subsidiary of Lon-
rho Plc, provided services to FMNA in the period for US$17
thousand (2011: US$nil). At 31 August 2012, the amount
payable to LAHL was US$17 thousand (2011: US$nil).
FMN Research Limited (“FMNR”) (a company controlled by
Mr J George, the Chief Executive Office Managing Director
of FMNA), provided services totalling US$218 thousand
(2011: US$nil). The services provided by FMNR included
technical support and software enhancements for FMNA
customers, and marketing support. At 31 August 2012, an
amount of US$118K (2011: US$nil) was fully written off.
During the period the Company entered into a number of
transactions with The Consilium Corporate Recovery Mas-
ter Fund Ltd, the Consilium Emerging Markets Absolute
Return Master Fund Ltd (jointly “Consilium”) a substantial
shareholder of Cambria. Loan funding received during the
period amounted to US$3,250 thousand (2011: US$nil). In-
terest and Fees paid during the period amounted to US$240
thousand (2011: US$nil) (see note 24 and 27).
On 16 September 2011, the Company raised US$1,450
thousand (£917 thousand) from Consilium via a placing of
3,988,439 shares at a price of 23 pence per share.
Post year end, Consilium participated in the Company’s eq-
uity placement on 1 October 2012, for US$375 thousand,
purchasing 2,308,000 shares at 10p per share for total val-
ue US$375 thousand.
Page 72
Cambria Africa Plc Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
36. Related parties (continued)
Transactions with key management personnel
Year ended August 2012
US$’000
Year ended 31 August 2011
US$’000
Directors
Executive officers
Total
Directors’ remuneration
E Wisman
P Turner
T Sanders
I Perkins
P Heber
I Mazaiwana
J Ellis
D Lenigas
G White
D Armstrong
E Priestley
C Orr-Ewing
Total
751
847
1,598
Total 2011
US$000
239
200
83
80
68
19
19
9
9
9
9
7
751
390
719
1,109
Total 2011
US$000
-
160
-
-
72
-
38
20
20
20
20
40
390
Key management personnel are the holding Company Di-
Subsequent to the 31 August 2012, the Company has entered
rectors and executive officers.
in to the following transactions with Consilium Corporate
Recovery Master Fund Ltd and Consilium Emerging Markets
Paul Heber, a Non-Executive Director, participates in the
Absolute Return Master Fund Ltd (jointly “Consilium”) a
share option scheme. Other Directors and key personnel are
substantial shareholder of Cambria.
eligible to participate in the share option scheme (see note
19).
Total remuneration is included in “personnel expenses”
(see note 6):
On 9 October 2012, US$250 thousand of a US$1,000
thousand (see note 27) Consilium facility maturing on 31
December 2013 was repaid. Additionally, the short term
US$250 thousand Consilium facility, which matured on 25
October 2012, was extended to 8 March 2014.
On 1 October 2012, Cambria raised US$1,400 thousand
37. Events after the reporting date
(£860 thousand), per an equity placement with new and
On 28 November 2012, the remaining US$750 thousand
Consilium facility, maturing on 31 December 2012, was
existing institutional and other investors of 8,615,115
rolled over, and will mature on 8 March 2014.
new ordinary shares at 10p per share. Following the share
placement, the Company had a total number of 66,749,023
shares in issue.
On 6 December, Consilium also agreed to lift a ‘general
charge’ which it held over the Company in return for secu-
Page 73
Financial Report 2012 Notes to the Financial Statements (continued)
F o r t h e p e r i o d e n d e d 3 1 A u g u s t 2 0 1 2
37. Events after the reporting date
(continued)
rity directly related to certain properties owned by Cambria
On 10 December 2012 Paul Heber resigned from his posi-
as well as receipt of a warrant instrument (the “Warrant”).
tion as a non-executive director of the Company and was
The Warrant provides for the issue of 3,000,000 new ordi-
subsequently appointed as a consultant to the Company.
nary shares of £0.0001 each in the capital of the Company
at an exercise price of 13p per Share. The Warrant is exer-
cisable in whole or in part by Consilium at any time prior to
6 December 2015.
On 11 January 2013, the Company entered into an unse-
cured Deed of Guarantee with MEKZ Limited for US$290
thousand, which expires on 30 June 2014. The Guarantee
is in respect of the credit facility which is provided to Gar-
On 18 February 2013, the Company successfully secured
doserve (Pvt) Limited, a Group company.
an additional US$1,500 thousand in debt financing from
Consilium bringing the total facility held with Consilium to
US$4,500 thousand. The additional facility carries a 15% an-
nualised interest rate and is due for repayment 8 March 2014.
As part of the expansion of the debt facility with US$1,500
thousand, Consilium has been given a ‘general charge’ over
the Company, while maintaining security directly related to
certain properties owned by Cambria, as well as receipt of
a second warrant instrument (the “Warrant”). This Warrant
provides for the issue of 5,000,000 new ordinary shares of
£0.0001 each in the capital of the Company at an exercise
price of 13p per Share. The Warrant is exercisable in whole
or in part by Consilium at any time prior to 15 February 2016.
On 14 February 2013 the Company successfully complet-
ed the sale of its shares in ForgetMeNot Africa Limited
(“FMNA”), to ForgetMeNot Software Limited (“FMNS”), for
US$250 thousand. The Company held 51% of the shares
while FMNS held the remaining 49%. The sale price will
be paid by FMNS upon achievement of certain milestones
or, at latest, twenty-four months from completion. The
US$250 thousand in proceeds will be accounted for by the
Company as a contingent asset.
The Directors do not believe there have been any further
material events since the reporting date.
Page 74
Cambria Africa Plc Corporate information
C o m p a n y S e c r e t a r y a n d C o n t a c t
D e t a i l s
Northern Wychwood Limited
1st Floor, Exchange House
54-58 Athol Street
Douglas
Isle of Man
IM99 1JD
British Isles
Tel: +44 (0) 1624 678 259
A u d i t o r s
KPMG Audit LLC
Heritage Court
41 Athol Street
Douglas
Isle of Man
IM99 1HN
Tel: +44 (0) 1624 681 000
R e g i s t e r e d O f f i c e a n d A g e n t
Appleby Trust (Isle of Man) Limited
33-37 Athol Street
Douglas
Isle of Man
IM1 1LB
Tel: +44 (0) 1624 647 647
N o m i n a t e d A d v i s o r a n d B r o k e r
WH Ireland Limited
24 Martin Lane
London
EC4R 0DR
Tel: +44 (0) 20 7220 1666
R e g i s t r a r s
Capita Registrars (Isle of Man) Limited
3rd Floor Exchange House
54-62 Athol Street
Douglas
Isle of Man
IM1 1JD
Tel: +44 (0) 870 162 3100
P r i n c i p a l G r o u p B a n k e r s
Barclays Corporate
Level 27, 1 Churchill Place
Canary Wharf
London
E14 5HP
United Kingdom
Tel: +44 (0) 207 116 1000
Page 75
Financial Report 2012 Shareholder information
% of total shares
Analysis of ordinary shareholdings as at 19 February 2013
Number of holders
Number of shares
% of total holders
Category of shareholder
Private shareholder
Banks, nominees and other
corporate bodies
Shareholding range
1 – 5,000
5,001 – 50,000
50,001 – 100,000
100,001 – 500,000
500,001 – 1,000,000
1,000,001 – 5,000,000
5,000,001 –10,000,000
10,000,001 – 50,000,000
Total
Registrars
84
190
98
95
23
33
13
9
2
1
274
30.66
69,34
35.77
34.67
8.39
12.04
4.75
3.28
0.73
0.37
100.00
2,358,187
64,390,836
250,977
1,939,121
1,822,361
8,832,982
9,977,772
16,909,965
12,763,182
14,252,663
66,749,023
3.53
96.47
0.38
2.91
2.73
13.23
14,95
25,33
19.12
21.35
100.00
All administrative enquiries relating to shareholdings, such as queries concerning dividend payments, notification of
change of address or the loss of a share certificate, should be addressed to the Company’s registrars.
Unsolicited mail
As the Company’s share register is, by law, open to public inspection, shareholders may receive unsolicited mail from
organisations that use it as a mailing list. Shareholders wishing to limit the amount of such mail should write to the Mailing
Preference Society, Freepost 29 Lon20771, London W1E 0ZT.
Page 76
Cambria Africa Plc Page 77
Financial Report 2012 Cambria Africa Plc
1 Berkeley Street
Mayfair
London
WIJ 8DJ
Tel: +44 (0) 203 4022 366
Fax: +44 (0) 203 4022 367
info@cambriaafrica.com
www.cambriaafrica.com