Annual financial statements 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated and company
annual financial statements
Index
Statutory reports
Statement of responsibility by the board of directors
Certificate by the company secretary
Independent auditor’s report
Report of the audit committee
Directors’ report to shareholders
1
1
2
3
5
Consolidated annual financial statements
11
Consolidated statement of financial position
12
Consolidated income statement
13
Consolidated statement of comprehensive income
14
Consolidated statement of changes in equity
Consolidated statement of cash flows
16
Notes to the consolidated annual financial statements 17
Company annual financial statements
Company statement of financial position
Company statement of comprehensive income
Company statement of changes in equity
Company statement of cash flows
Notes to the company annual financial statements
Corporate information
Administration and corporate information
Analysis of shareholders and shareholders’ diary
134
135
136
137
138
151
152
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Statement of responsibility by the board of directors
for the year ended 31 March 2011
The annual financial statements of the group
and the company are the responsibility of the
directors of Naspers Limited. In discharging
this responsibility, they rely on the management
of the group to prepare the annual financial
statements presented on pages 3 to 150 in
accordance with International Financial
Reporting Standards (IFRS) and the South
African Companies Act No 61 of 1973. As
such, the annual financial statements include
amounts based on judgements and estimates
made by management. The information given
is comprehensive and presented in a
responsible manner.
The directors accept responsibility for the
preparation, integrity and fair presentation of
the annual financial statements and are
satisfied that the systems and internal financial
controls implemented by management are
effective.
The directors believe that the company and
group have adequate resources to continue
operations as a going concern in the
foreseeable future, based on forecasts and
available cash resources. The financial
statements support the viability of the company
and the group.
The independent auditing firm
PricewaterhouseCoopers Inc., which was given
unrestricted access to all financial records and
related data, including minutes of all meetings
of shareholders, the board of directors and
committees of the board, has audited the
annual financial statements. The directors
believe that all representations made to the
independent auditors during their audit were
valid and appropriate.
PricewaterhouseCoopers Inc.’s audit report
is presented on page 2.
The annual financial statements were
approved by the board of directors on 24 June
2011 and are signed on its behalf by:
T Vosloo
Chairman
J P Bekker
Chief executive
Certificate by the company secretary
I, Gillian Kisbey-Green, being the company secretary of Naspers Limited, certify that the company
has, for the year under review, lodged all returns required of a public company with the Registrar of
Companies, and that all such returns are, to the best of my knowledge and belief, true, correct and
up to date.
G Kisbey-Green
Company secretary
24 June 2011
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
1
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Independent auditor’s report to the members of
Naspers Limited
We have audited the group annual financial
statements and annual financial statements of
Naspers Limited, which comprise the
consolidated and separate statements of
financial position as at 31 March 2011, and the
consolidated income statement and
consolidated and separate statements of
comprehensive income, changes in equity and
cash flows for the year then ended, and a
summary of significant accounting policies and
other explanatory notes, and the directors’
report, as set out on pages 5 to 150.
DIRECTORS’ RESPONSIBILITY FOR THE
FINANCIAL STATEMENTS
The company’s directors are responsible for
the preparation and fair presentation of these
financial statements in accordance with
International Financial Reporting Standards
(IFRS) and in the manner required by the
Companies Act of South Africa, and for such
internal control as the directors determine is
necessary to enable the preparation of financial
statements that are free from material
misstatements, whether due to fraud or error.
AUDITOR’S RESPONSIBILITY
Our responsibility is to express an opinion on
these financial statements based on our audit.
We conducted our audit in accordance with
International Standards on Auditing. Those
standards require that we comply with ethical
requirements and plan and perform the audit to
obtain reasonable assurance whether the
financial statements are free from material
misstatement.
An audit involves performing procedures to
obtain audit evidence about the amounts and
disclosures in the financial statements. The
procedures selected depend on the auditor’s
judgement, including the assessment of the
2
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
risks of material misstatement of the financial
statements, whether due to fraud or error. In
making those risk assessments, the auditor
considers internal control relevant to the entity’s
preparation and fair presentation of the
financial statements in order to design audit
procedures that are appropriate in the
circumstances, but not for the purpose of
expressing an opinion on the effectiveness of
the entity’s internal control. An audit also
includes evaluating the appropriateness of
accounting policies used and the
reasonableness of accounting estimates made
by management, as well as evaluating the
overall presentation of the financial statements.
We believe that the audit evidence we have
obtained is sufficient and appropriate to
provide a basis for our audit opinion.
OPINION
In our opinion, the financial statements present
fairly, in all material respects, the consolidated
and separate financial position of Naspers
Limited as at 31 March 2011, and its
consolidated and separate financial
performance and its consolidated and separate
cash flows for the year then ended in
accordance with International Financial
Reporting Standards and in the manner
required by the Companies Act of
South Africa.
PricewaterhouseCoopers Inc.
Director: Anton Wentzel
Registered auditor
Cape Town, South Africa
24 June 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Report of the audit committee
for the year ended 31 March 2011
The audit committee has pleasure in submitting
(cid:96) Reviewed the board approved internal audit
this report, as required by sections 269A and
charter. No amendments were
270A of the South African Companies Act
recommended to the board by the
No 61 of 1973.
committee.
FUNCTIONS OF THE AUDIT COMMITTEE
The audit committee has adopted formal terms
of reference, delegated to it by the board of
directors, as its audit committee charter.
The audit committee has discharged the
functions in terms of its charter and ascribed to
it in terms of the act as follows:
(cid:96) Reviewed the interim, provisional, year-end
financial statements and the year-end
integrated report, culminating in a
recommendation to the board to adopt them.
In the course of its review the committee:
(cid:116)(cid:1) (cid:1)(cid:1)(cid:85)(cid:80)(cid:80)(cid:76)(cid:1)(cid:66)(cid:81)(cid:81)(cid:83)(cid:80)(cid:81)(cid:83)(cid:74)(cid:66)(cid:85)(cid:70)(cid:1)(cid:84)(cid:85)(cid:70)(cid:81)(cid:84)(cid:1)(cid:85)(cid:80)(cid:1)(cid:70)(cid:79)(cid:84)(cid:86)(cid:83)(cid:70)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)
financial statements were prepared in
accordance with International Financial
Reporting Standards (IFRS) and in the
manner required by the South African
Companies Act No 61 of 1973
(cid:116)(cid:1) (cid:1)(cid:68)(cid:80)(cid:79)(cid:84)(cid:74)(cid:69)(cid:70)(cid:83)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:13)(cid:1)(cid:88)(cid:73)(cid:70)(cid:79)(cid:1)(cid:66)(cid:81)(cid:81)(cid:83)(cid:80)(cid:81)(cid:83)(cid:74)(cid:66)(cid:85)(cid:70)(cid:13)(cid:1)(cid:78)(cid:66)(cid:69)(cid:70)(cid:1)
recommendations on internal financial
controls
(cid:116)(cid:1) (cid:1)(cid:69)(cid:70)(cid:66)(cid:77)(cid:85)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:1)(cid:68)(cid:80)(cid:79)(cid:68)(cid:70)(cid:83)(cid:79)(cid:84)(cid:1)(cid:80)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:77)(cid:66)(cid:74)(cid:79)(cid:85)(cid:84)(cid:1)(cid:83)(cid:70)(cid:77)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)
to accounting policies, internal audit, the
(cid:96) Reviewed and approved the internal audit
plan.
(cid:96) Reviewed internal audit and risk
management reports and, where relevant,
recommendations being made to the board.
(cid:96) Evaluated the effectiveness of risk
management, controls and governance
processes.
(cid:96) Verified the independence of the
external auditors, nominated
PricewaterhouseCoopers Inc. as auditor
for 2011 and noted the appointment of
Mr Anton Wentzel as the designated auditor.
(cid:96) Approved audit fees and engagement terms
of the external auditor.
(cid:96) Determined the nature and extent of
allowable non-audit services and approved
contract terms for provision of non-audit
services by the external auditor.
MEMBERS OF THE AUDIT COMMITTEE
AND ATTENDANCE AT MEETINGS
The audit committee consists of the non-
executive directors listed below and meets at
auditing or content of annual financial
least three times per annum in accordance
statements, and internal financial controls,
with its charter. All members act independently
and
as described in section 269A of the South
(cid:116)(cid:1) (cid:1)(cid:83)(cid:70)(cid:87)(cid:74)(cid:70)(cid:88)(cid:70)(cid:69)(cid:1)(cid:77)(cid:70)(cid:72)(cid:66)(cid:77)(cid:1)(cid:78)(cid:66)(cid:85)(cid:85)(cid:70)(cid:83)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:68)(cid:80)(cid:86)(cid:77)(cid:69)(cid:1)(cid:73)(cid:66)(cid:87)(cid:70)(cid:1)(cid:66)(cid:1)
significant impact on the organisation’s
African Companies Act No 61 of 1973. During
the year under review, four meetings were held
financial statements.
and details of attendance are on page 10.
(cid:96) Reviewed external audit reports on the
annual financial statements.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
3
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Report of the audit committee (continued)
for the year ended 31 March 2011
Name of committee member
J J M van Zyl
R C C Jafta
F-A du Plessis
B J van der Ross
All committee members, with the exception
of Mr van der Ross who was appointed with
effect from 17 June 2010, served on the
committee for the full financial year.
INTERNAL AUDIT
The audit committee fulfils an oversight role on
the group’s financial statements and the
reporting process, including the system of
internal financial control. It is responsible for
ensuring the group’s internal audit function is
independent and has the necessary resources,
standing and authority in the organisation to
enable it to discharge its duties. Furthermore,
the committee oversees cooperation between
the internal and external auditors, and serves as
a link between the board of directors and these
functions. The head of internal audit reports
functionally to the chair of the committee and
administratively to the financial director.
ATTENDANCE
The internal and external auditors, in their
capacity as auditors to the group, attended
and reported at all meetings of the audit
committee. The group risk management
function was also represented. Executive
directors and relevant senior managers
attended meetings by invitation.
Qualifications
PrEng and BScEng (UCT)
MEcon and PhD
BComHons (Taxation), LLB and CA(SA)
DipLaw (UCT)
members and the internal and external
auditors.
INDEPENDENCE OF EXTERNAL AUDITORS
During the year under review the audit committee
reviewed a representation by the external auditors
and, after conducting its own review, confirmed
the independence of the auditors.
EXPERTISE AND EXPERIENCE OF
FINANCIAL DIRECTOR AND FINANCE
FUNCTION
As required by JSE Listings Requirement 3.84(h),
the audit committee has satisfied itself that the
financial director has appropriate expertise and
experience. In addition, the committee also
satisfied itself that the composition, experience
and skills set of the finance function met the
group’s requirements.
DISCHARGE OF RESPONSIBILITIES
The committee determined that during the
financial year under review it had discharged its
legal and other responsibilities as outlined in
terms of its remit, details of which are included
on page 103 of the integrated annual report. The
board concurred with this assessment.
CONFIDENTIAL MEETINGS
Audit committee agendas provide for
confidential meetings between committee
J J M van Zyl
Chairman: Audit committee
24 June 2011
4
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders
for the year ended 31 March 2011
The directors present their integrated annual
revenues, whilst the technology business was
report, which forms part of the audited annual
able to improve margins.
financial statements of the company and the
Over the past year the group continued to
group for the year ended 31 March 2011.
expand, as evidenced by growth in revenues.
NATURE OF BUSINESS
Naspers Limited was incorporated in 1915
under the laws of the Republic of South Africa.
The principal activities of Naspers and its
operating subsidiaries, joint ventures and
associated companies (collectively “the group”)
are the operation of pay television and the
provision of related technologies, the operation
of internet and instant messaging subscriber
platforms, e-commerce platforms and the
publishing, distribution and printing of
magazines, newspapers and books. These
activities are conducted primarily in South
Africa, sub-Saharan Africa, China, Central and
Eastern Europe, Russia, India and Latin
America.
OPERATING REVIEW
The group achieved a solid performance over
the past year. Consolidated revenues grew by
18%. These results were underpinned by a
diversified portfolio and a strong balance sheet.
Major areas of growth were the internet and
pay-television businesses. Worldwide the
internet industry continued its expansion from
which most of our internet businesses
benefited. The resilience of our pay-television
operations in an increasingly competitive
environment underscores the benefit of quality
content, although rising costs place margins
under pressure. Our print media business
experienced a limited recovery in advertising
Although nuances shift gradually, the growth
strategy continues to have three legs: organic
growth of existing businesses, pursuing
acquisitions and developing new technologies.
Recent experience is that internet valuations,
in our opinion, have become inflated and good
value is difficult to find these days. As a
consequence, we are focusing somewhat more
on growing our businesses organically and on
developing new technologies. This may
dampen earnings in the year ahead as the cost
of developing these businesses are expensed
through the income statement. However, we
believe this strategy is sound and will stimulate
long-term growth prospects.
SEGMENTAL REVIEW
This segmental review includes our
consolidated subsidiaries, plus the proportional
consolidation of associated companies. Refer
to note 37 for our segmental reporting.
Internet
Overall the internet segment reported revenue
growth of 47% and trading profits rose 48%.
In China, Tencent recorded another strong
set of results in an increasingly competitive
market. Rapid growth of the internet industry in
China enabled Tencent, through its focus on
user experience, to further expand the
usefulness of its core platforms. The QQ
platforms now manage 674 million active
instant messaging (IM) user accounts and
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
5
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders (continued)
for the year ended 31 March 2011
SEGMENTAL REVIEW (continued)
Internet (continued)
In South Africa, the gross base expanded
by 637 000 to 3,5 million subscribers. The
137 million peak simultaneous users. The
lower-priced Compact bouquet accounted for
social service, Qzone, also grew well with
59% of the growth. Television advertising
current user accounts of 504 million.
revenues rebounded, growing 32%.
The Russian internet market remains lively
In the rest of sub-Saharan Africa our base
and Mail.ru Group maintained market share
grew by 340 000 to 1,4 million subscribers.
in most segments. They are the leading
The lower-priced Compact and Family
provider of services to internet consumers
bouquets now reach 602 000 families. Trading
in Russian-speaking markets.
margins were reduced by a higher investment
In aggregate, the other internet businesses
in decoder subsidies, local and sport content
reported revenue growth of 37% and a
and additional satellite capacity.
marginal trading loss of R6m, the result of
Competition is expected to intensify across
increased development costs. The e-commerce
the continent and the regulatory environment
operations of Allegro (Eastern Europe) and
remains uncertain.
Ricardo (Western Europe) continued expanding
After a period of uncertainty, the Southern
healthily. Both businesses broadened their
Africa Development Community selected the
product offerings through organic growth and
latest version of the digital video broadcast
smaller bolt-on acquisitions.
In Latin America, our e-commerce business,
standard (DVB-T2) to migrate analogue
terrestrial services to digital terrestrial television
BuscaPé, continued to deepen its services and
(DTT).
broaden its revenue base. The acquisition of
the classified platform, OLX, strengthened our
product range in this market.
Pay television
Technology
Consolidated revenues in local currency grew
10% and operating performance improved as
Irdeto benefited from efficient management of
The past year was characterised by lively
its products and structure. Over 18 million
subscriber growth, with 977 000 subscribers
conditional access units were delivered, a 17%
added to the base. This was largely driven by
increase on the previous year. In most product
the Fifa 2010 World Cup, coupled with
categories new clients were added and new
decoder subsidies and marketing. As a
consequence, revenue increased 19% to
offerings introduced, which positions Irdeto
to secure internet distributed digital assets
R21bn. Trading margins were lower due to
and content.
cost pressures from growing the subscriber
base, higher sport content costs and
competition. Good progress was made in
increasing local content and skills.
Print media
Our operations in South Africa showed revenue
growth of 9%, with advertising improving only
modestly. Trading profits declined in part due
6
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders (continued)
for the year ended 31 March 2011
SEGMENTAL REVIEW (continued)
assets and cash. DST was renamed
Print media (continued)
Mail.ru Group and listed on the London Stock
to the troublesome implementation of a new
Exchange in November 2010.
enterprise resource planning system. In Brazil,
The group issued a seven-year US$700m
Abril’s revenue and operating profit, excluding
bond with a coupon rate of 6,375%. The
the educational business sold during the prior
proceeds were used to partly pay down an
year, grew 14% on the back of a buoyant
offshore revolving credit facility (RCF).
economy.
FINANCIAL REVIEW
Over the past year consolidated revenues
expanded by 18% to R33bn. Consolidated
internet revenues were up 36%, whilst growth
of the subscriber base saw pay-television
revenues 19% higher. Consolidated trading
profit, which includes finance cost on
During March the group refinanced its RCF.
Capacity was increased to US$2bn and the
term extended to 2016. The facilities bear
interest at US LIBOR plus 1,75% before
commitment and utilisation fees.
During the period, the group impaired R1bn
of goodwill and intangible assets, mainly at
Gadu-Gadu, where growth has lagged.
transponder leases but excludes amortisation
SHARE CAPITAL
of intangible assets (other than software) and
The authorised share capital at 31 March 2011
other gains/losses, lifted 7% to R5,8bn. The
reduction in margins was largely the result of
was:
(cid:96) 1 250 000 A ordinary shares of R20 each,
higher costs in the pay-television business.
and
Net interest cost on cash and loans
(cid:96) 500 000 000 N ordinary shares of 2 cents
increased from R286m last year to R575m,
each.
the result of funding investments with debt.
Naspers issued no new A ordinary shares
Our earnings from equity-accounted associates
during the 2011 financial year. During the
grew to R3,3bn.
current financial year, the group issued
The reported dilution gains of R1,5bn, arise
5 000 N ordinary shares to the Naspers share
mainly from the contribution of the group’s
incentive trust and 691 500 N ordinary shares
stake in Mail.ru into the newly listed entity.
to various MIH share incentive trusts.
Our funding structure remains sound with
The issued share capital at 31 March 2011
total consolidated net debt, excluding satellite
was:
leases, of R3,9bn. This represents a net
(cid:96) 712 131 A ordinary shares
debt:equity ratio of 10%.
The group consolidated its internet interests
in Russia, acquiring a 29% interest in Digital
Sky Technologies (DST) by contributing existing
of R20 each
R14 242 620
(cid:96) 406 581 911 N ordinary
shares of 2 cents each
R8 131 638
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
7
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders (continued)
for the year ended 31 March 2011
PROPERTY, PLANT AND EQUIPMENT
disclosed in note 7 to the consolidated annual
At 31 March 2011 the group’s investment in
financial statements. All subsidiaries, significant
property, plant and equipment amounted to
associated companies and joint ventures share
R7,6bn, compared with R6,5bn last year.
the same financial year-end as the holding
Details are reflected in note 4 of the
company, except for Tencent Holdings Limited,
consolidated annual financial statements.
Abril S.A. and Mail.ru Group, which have a
Capital commitments at 31 March 2011
31 December year-end. The holding company’s
amounted to R401,1m (2010: R526,6m).
interest in the aggregate amount of profit after
Further capital expenditure to the amount of
tax but before the non-controlling interest
R2,3bn has been approved by the boards of
earned by subsidiaries totalled R6,1bn (2010:
directors of the various group companies, but
R4,5bn) and its interest in the aggregate losses
has not been contracted for as of 31 March
after tax amounted to R19,4m (2010: R117m).
2011.
DIVIDENDS
The board recommends that a dividend of
270 cents per listed N ordinary share be
Details relating to significant acquisitions and
divestitures in the group during the year are
highlighted in note 3 to the consolidated annual
financial statements.
declared (2010: 235 cents) and 54 cents per
DIRECTORS, SECRETARY AND AUDITORS
A ordinary share (2010: 47 cents).
The directors’ names and details are presented
GROUP
Naspers Limited is not a subsidiary of any
other company. The name, country of
incorporation and effective financial percentage
interest of the holding company in each of the
Naspers group’s principal subsidiaries are
in the table below and the secretary’s name
and business and postal address are
presented on page 151. Directors’
shareholdings in the issued share capital of
the company are disclosed in note 13 to the
consolidated annual financial statements.
8
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders (continued)
for the year ended 31 March 2011
Directors and attendance at meetings
Date first appointed
in current position
Date last
appointed
T Vosloo
6 October 1997
27 August 2010
J P Bekker
F-A du Plessis
6 October 1997
23 October 2003
1 April 2008
28 August 2009
G J Gerwel
12 July 1999
22 August 2008
R C C Jafta
23 October 2003
28 August 2009
L N Jonker
7 June 1996
27 August 2010
D Meyer
25 November 2009
25 November 2009
S J Z Pacak
24 April 1998
1 April 2009
T M F Phaswana
23 October 2003
28 August 2009
L P Retief
1 September 2008
1 September 2008
B J van der Ross
12 February 1999
22 August 2008
N P van Heerden
7 June 1996
27 August 2010
J J M van Zyl
1 January 1988
22 August 2008
H S S Willemse
30 August 2002
27 August 2010
Five board
meetings were
held during
the year
Attendance
5
5
5
5
5
5
5
5
5
5
5
5
5
5
Category
Independent
non-executive
Executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Executive
Independent
non-executive
Non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
9
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Directors’ report to shareholders (continued)
for the year ended 31 March 2011
Committees and attendance at meetings
Executive
committee
Audit
committee1
Risk
committee
Human
resources
and
remuneration
committee1
Nomination
committee1
Three
meetings
held
during
the year:
Four
meetings
held
during
the year:
Four
meetings
held
during
the year:
Five
meetings
held
during
the year:
Five
meetings
held
during
the year:
Attendance
Attendance Attendance Attendance Attendance Category
T Vosloo
√
3
F-A du Plessis
√
4
G J Gerwel
√
3
R C C Jafta
J J M van Zyl
√
3
B J van der Ross
J P Bekker
S J Z Pacak
√
√
3
3
√
√
√
4
4
3
Note
1Executive directors attend meetings by invitation.
√
√
√
√
√
√
√
4
4
4
4
3
4
4
√
5
√
√
5
√
5
5
√
5
√
5
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Independent
non-executive
Executive
Executive
PricewaterhouseCoopers Inc. will continue in office as auditor in accordance with section 90(6) of
the South African Companies Act, 2008.
BORROWINGS
SUBSEQUENT EVENTS
The company has unlimited borrowing powers
No significant events have occurred between
in terms of its articles of association.
the financial year-end and the date of these
financial statements.
Signed on behalf of the board
T Vosloo
Chairman
J P Bekker
Chief executive
24 June 2011
10
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated statement of financial position
at 31 March 2011
31 March
31 March
ASSETS
Non-current assets
Property, plant and equipment
Goodwill
Other intangible assets
Investments in associates
Investments and loans
Derivative financial instruments
Deferred taxation
Current assets
Inventory
Programme and film rights
Trade receivables
Other receivables
Related party receivables
Investments and loans
Derivative financial instruments
Cash and cash equivalents
Non-current assets held-for-sale
TOTAL ASSETS
EQUITY AND LIABILITIES
Capital and reserves attributable to the group’s
equity holders
Share capital and premium
Other reserves
Retained earnings
Non-controlling interest
TOTAL EQUITY
Non-current liabilities
Post-retirement medical liability
Long-term liabilities
Cash-settled share-based payment liability
Provisions
Derivative financial instruments
Deferred taxation
Current liabilities
Current portion of long-term debt
Provisions
Trade payables
Accrued expenses and other current liabilities
Related party payables
Taxation
Dividends payable
Derivative financial instruments
Bank overdrafts and call loans
TOTAL EQUITY AND LIABILITIES
Notes
4
5
6
7
7
38
9
10
8
11
12
13
7
38
36
28
14
15
16
17
18
40
19
38
9
18
19
20
13
38
36
2011
R’m
53 610
7 561
17 278
3 886
20 767
3 295
6
817
16 245
731
1 487
2 929
2 139
38
141
12
8 731
16 208
37
69 855
40 662
14 384
5 099
21 179
2 280
42 942
14 950
179
12 838
6
48
714
1 165
11 963
1 510
189
1 916
6 183
93
143
–
599
1 330
69 855
2010
R’m
44 342
6 490
16 620
4 976
11 942
3 500
—
814
13 126
693
1 298
2 438
1 871
26
3
—
6 785
13 114
12
57 468
33 660
14 467
2 370
16 823
1 974
35 634
10 892
178
8 750
5
15
684
1 260
10 942
1 675
187
1 722
5 226
9
316
2
847
958
57 468
The accompanying notes are an integral part of these consolidated annual financial statements.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
11
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated income statement
for the year ended 31 March 2011
Revenue
Cost of providing services and sale of goods
Selling, general and administration expenses
Other gains/(losses) – net
Operating profit
Interest received
Interest paid
Other finance income/(costs) – net
Share of equity-accounted results
Impairment of equity-accounted investments
Dilution gains on equity-accounted investments
Gains on acquisitions and disposals
Profit before taxation
Taxation
Net profit for the year
Attributable to:
Equity holders of the group
Non-controlling interest
Earnings per N ordinary share (cents)
Basic
Fully diluted
Notes
22
23
23
24
25
25
25
7
7
7
26
27
29
29
31 March
31 March
2011
R’m
33 085
(17 794)
(10 354)
(881)
4 056
401
(1 389)
(30)
3 290
(23)
1 461
42
7 808
(1 861)
5 947
5 260
687
5 947
1 405
1 351
2010
R’m
27 998
(14 438)
(9 155)
(364)
4 041
348
(883)
114
2 058
(62)
–
144
5 760
(1 808)
3 952
3 257
695
3 952
873
848
The accompanying notes are an integral part of these consolidated annual financial statements.
12
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated statement of comprehensive income
for the year ended 31 March 2011
31 March
31 March
Profit for the year
Other comprehensive income
Foreign currency translation reserve
– Exchange loss arising on translating the net assets of
foreign operations
Hedging reserve
– Net fair value gains/(losses), gross
– Net fair value gains/(losses), tax portion
– Derecognised and added to asset, gross
– Derecognised and added to asset, tax portion
– Derecognised and reported in income, gross
– Derecognised and reported in income, tax portion
– Derecognised and reported in income when recognition
criteria failed, gross
– Derecognised and reported in income when recognition
criteria failed, tax portion
Share of associates’ direct reserve movements
– Share-based compensation reserve
– Existing control business combination reserve
– Valuation reserve
Total other comprehensive income, net of tax for the
year
Total comprehensive income for the year
Attributable to:
Equity holders of the group
Non-controlling interest
2011
R’m
5 947
(461)
(461)
116
(318)
54
11
25
357
(68)
76
(21)
2 622
219
(10)
2 413
2 277
8 224
7 543
681
8 224
2010
R’m
3 952
(1 918)
(1 918)
(379)
(980)
238
191
(25)
158
(12)
71
(20)
250
148
101
1
(2 047)
1 905
1 308
597
1 905
The accompanying notes are an integral part of these consolidated annual financial statements.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
13
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated statement of changes in equity
for the year ended 31 March 2011
Balance at 1 April 2009
Total comprehensive income for the year
– Profit for the year
– Total other comprehensive income for the year
Share capital movements
Treasury share movements
Share-based compensation reserve movement
Transactions with non-controlling shareholders
Dividends
Balance at 31 March 2010
Balance at 1 April 2010
Total comprehensive income for the year
– Profit for the year
– Total other comprehensive income for the year
Share capital movements
Treasury share movements
Share-based compensation reserve movement
Transactions with non-controlling shareholders
Dividends
Balance at 31 March 2011
14
—
—
—
—
—
—
—
—
14
14
—
—
—
—
—
—
—
—
14
Share capital and
premium
A shares
N shares
Foreign
currency
translation
reserve
R’m
R’m
R’m
Hedging
reserve
R’m
(115)
(292)
—
(292)
—
—
—
—
—
(407)
(407)
110
—
110
—
—
—
—
—
15 060
—
—
—
433
(209)
(831)
—
—
14 453
14 453
—
—
—
253
(336)
—
—
—
1 170
(1 907)
—
(1 907)
—
—
—
—
—
(737)
(737)
(448)
—
(448)
—
—
—
—
—
14 370
(1 185)
(297)
The accompanying notes are an integral part of these consolidated annual financial statements.
14
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Existing
control
business
combination
reserve
Share-
based
compen-
sation
reserve
Valuation
reserve
Retained
earnings
Share-
holders’
funds
Non-
controlling
interest
R’m
R’m
R’m
R’m
R’m
R’m
1 843
1
—
1
—
—
—
—
—
1 844
1 844
2 412
—
2 412
—
—
—
—
—
4 256
330
101
—
101
—
—
—
(334)
—
97
97
(10)
—
(10)
—
—
—
(62)
—
25
Total
R’m
35 217
1 905
3 952
(2 047)
433
(209)
(319)
(309)
928
148
—
148
—
—
497
—
—
14 361
3 257
3 257
—
—
—
—
(22)
(773)
33 591
1 308
3 257
(1 949)
433
(209)
(334)
(356)
(773)
1 626
597
695
(98)
—
—
15
47
(311)
(1 084)
1 573
16 823
33 660
1 974
35 634
1 573
219
—
219
—
—
508
—
—
16 823
5 260
5 260
—
—
—
—
(22)
(882)
33 660
7 543
5 260
2 283
253
(336)
508
(84)
(882)
1 974
681
687
(6)
—
—
16
274
(665)
35 634
8 224
5 947
2 277
253
(336)
524
190
(1 547)
2 300
21 179
40 662
2 280
42 942
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
15
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Consolidated statement of cash flows
for the year ended 31 March 2011
31 March
31 March
Notes
30
31
32
33
34
35
Cash flows from operating activities
Cash from operations
Dividends received from investments and equity-
accounted companies
Cash generated from operating activities
Interest income received
Interest costs paid
Taxation paid
Net cash generated from operating activities
Cash flows from investing activities
Property, plant and equipment acquired
Proceeds from sale of property, plant and equipment
Insurance proceeds received
Intangible assets acquired
Proceeds from sale of intangible assets
Acquisition of subsidiaries
Disposal of subsidiaries
Dilution of subsidiaries
Acquisition of joint ventures
Partial disposal of interest in joint ventures
Acquisition of associates
Disposal of associates
Additional investment in existing associates
Partial disposal of associates underlying investment
Preference dividends received
Cash movement in other investments and loans
Net cash utilised in investing activities
Cash flows from financing activities
Proceeds from long-term loans raised
Repayments of long- and short-term loans
Additional investment in existing subsidiaries
Repayments of capitalised finance lease liabilities
Payments to finance share-based compensation
expenses
Dividends paid by subsidiaries to non-controlling
shareholders
Dividend paid by holding company
Other
Net cash generated from/(utilised in) financing activities
Net increase in cash and cash equivalents
Foreign exchange translation adjustments on cash and
cash equivalents
Cash and cash equivalents at beginning of the year
Cash and cash equivalents classified as held-for-sale
at beginning of the year
Cash and cash equivalents at end of the year
36
2011
R’m
7 276
616
7 892
405
(1 044)
(1 983)
5 270
(1 668)
78
186
(162)
11
(1 944)
—
65
(16)
63
(3 065)
215
—
58
503
(102)
(5 778)
6 826
(2 326)
(20)
(329)
(89)
(667)
(882)
—
2 513
2 005
(431)
5 827
—
7 401
The accompanying notes are an integral part of these consolidated annual financial statements.
16
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
2010
R’m
7 266
487
7 753
408
(753)
(1 786)
5 622
(1 590)
55
327
(280)
85
(3 045)
403
—
(31)
—
(45)
1
(842)
—
164
46
(4 752)
2 690
(547)
(240)
(346)
(613)
(320)
(773)
(20)
(169)
701
(678)
5 725
79
5 827
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements
1. NATURE OF OPERATIONS
Naspers Limited was incorporated in 1915 under the laws of the Republic of South Africa. The
principal activities of Naspers and its operating subsidiaries, joint ventures and associated companies
(collectively (cid:2130)the group”) are the operation of pay television, internet and instant-messaging subscriber
platforms, e-commerce platforms and the provision of related technologies and the publishing,
distribution and printing of magazines, newspapers and books. These activities are conducted
primarily in South Africa, sub-Saharan Africa, China, Central and Eastern Europe, Russia, India and
Latin America.
2. PRINCIPAL ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these consolidated financial statements
are set out below. These policies have been consistently applied to all the years presented, unless
otherwise stated.
The consolidated annual financial statements of the group are presented in accordance with, and
comply with International Financial Reporting Standards (IFRS), International Financial Reporting
Interpretations Committee (IFRIC), interpretations issued and effective at the time of preparing these
financial statements and the South African Companies Act No 61 of 1973, as amended. The
consolidated financial statements are prepared according to the historic cost convention as modified
by the revaluation of available-for-sale financial assets and financial assets and liabilities (including
derivative instruments) at fair value with the movements recognised in the income statement and
statement of comprehensive income.
The preparation of the consolidated financial statements necessitates the use of estimates,
assumptions and judgements by management. These estimates and assumptions affect the reported
amounts of assets, liabilities and contingent assets and liabilities at the statement of financial position
date as well as affecting the reported income and expenses for the year. Although estimates are
based on management’s best knowledge and judgement of current facts as at the statement of
financial position date, the actual outcome may differ from these estimates. Estimates are made
regarding the fair value of intangible assets recognised in business combinations; impairment of
goodwill, intangible assets, property, plant and equipment, financial assets, financial assets carried at
amortised cost, available-for-sale financial assets and other assets; the remeasurements required in
business combinations and disposals of associates, joint ventures and subsidiaries; fair value
measurements of level 2 and level 3 financial instruments; provisions; taxation; post-retirement
medical aid benefits and equity compensation benefits. Refer to the individual notes for details of
estimates, assumptions and judgements used.
(a) Basis of consolidation
The consolidated annual financial statements include the results of Naspers Limited and its
subsidiaries, associates, joint ventures and related share incentive trusts.
Subsidiaries
Subsidiaries are entities controlled by the group. The existence and effect of potential voting
rights that are currently exercisable or convertible without restriction are considered when
assessing whether the group controls another entity. Subsidiaries are consolidated from the date
that effective control is transferred to the group and are no longer consolidated from the date that
effective control ceases. For certain entities, the group has entered into contractual arrangements
(such as nominee relationships and escrow arrangements), which allow the group, along with its
direct interests in such entities, to control a majority of the voting rights or otherwise have power
to exercise control over the operations of such entities. Because the group controls such entities
in this manner they are considered to be subsidiaries and are therefore consolidated in the annual
financial statements.
All intergroup transactions, balances and unrealised gains and losses are eliminated as part of
the consolidation process. The interests of non-controlling shareholders in the consolidated
equity and results of the group are shown separately in the consolidated statement of financial
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
17
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(a) Basis of consolidation (continued)
Subsidiaries (continued)
position, consolidated income statement and consolidated statement of comprehensive income,
respectively. Losses applicable to the non-controlling interests in a subsidiary are allocated to the
non-controlling interests even if doing so causes the non-controlling interests to have a deficit
balance.
Business combinations
Business combinations are accounted for using the acquisition method. The consideration
transferred for the acquisition of a subsidiary is the fair values of the assets transferred, the
liabilities incurred and the equity interests issued by the group. The consideration transferred
includes the fair value of any asset or liability resulting from a contingent consideration
arrangement. For each business combination, the group measures the non-controlling interest in
the acquiree at the proportionate share of the acquiree’s identifiable net assets. Costs related to
the acquisition, other than those associated with the issue of debt or equity securities, are
expensed as incurred.
The consideration transferred does not include amounts related to the settlement of pre-existing
relationships. Such amounts are generally recognised in profit or loss. If the business combination
is achieved in stages, the acquisition date fair value of the acquirer’s previously held equity
interest in the acquiree is remeasured to fair value as at the acquisition date through profit and
loss. Any contingent consideration payable is recognised at fair value at the acquisition date. If
the contingent consideration is classified as equity, it is not remeasured and settlement is
accounted for within equity. Otherwise, subsequent changes to the fair value of the contingent
consideration are recognised in profit or loss.
Goodwill
Goodwill is initially measured at cost being the excess of the consideration transferred, the
amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any
previous equity interest over the group’s net identifiable assets acquired and liabilities assumed.
If this consideration is lower than the fair value of the net assets of the subsidiary acquired
(a bargain purchase), the difference is recognised in profit or loss.
Goodwill on acquisition of subsidiaries and joint ventures is included in (cid:2130)goodwill” on the statement
of financial position. Goodwill on acquisitions of associates is included in (cid:2130)investments in associates”.
Separately recognised goodwill is tested annually for impairment and carried at cost less
accumulated impairment losses. Impairment losses on goodwill are not reversed. Gains and losses
on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units (which are expected to benefit from the business
combination) for the purpose of impairment testing. An impairment is determined by assessing
the recoverable amount of the cash-generating unit to which the goodwill relates. Where the
recoverable amount of the cash-generating unit is less than the carrying amount, an impairment
loss is recognised.
Transactions with non-controlling shareholders
The group applies the economic entity model in accounting for transactions with non-controlling
shareholders. In terms of this model, non-controlling shareholders are viewed as equity
participants of the group and all transactions with non-controlling shareholders are therefore
accounted for as equity transactions and included in the statement of changes in equity. On
acquisition of an interest from a non-controlling shareholder, any excess of the cost of the
transaction over the acquirer’s proportionate share of the net asset value acquired is allocated
to a separate component of equity. Dilution profits and losses relating to non-wholly owned
subsidiary entities are similarly accounted for in the statement of changes in equity in terms of the
economic entity model.
18
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(a) Basis of consolidation (continued)
Common control transactions
Business combinations in which all of the combining entities or businesses are ultimately
controlled by the same party or parties both before and after the business combination (and
where that control is not transitory) are referred to as common control transactions. The
accounting policy for the acquiring entity would be to account for the transaction at book values
in its consolidated financial statements. The book values of the acquired entity are the
consolidated book values as reflected in the consolidated financial statements of the selling
entity. The excess of the cost of the transaction over the acquirer’s proportionate share of the net
asset value acquired in common control transactions, will be allocated to the existing control
business combination reserve in equity. Where comparative periods are presented, the financial
statements and financial information presented are not restated. Accounting policies of
subsidiaries have been changed where necessary to ensure consistency with the policies
adopted by the group.
Associated companies
Investments in associated companies are accounted for under the equity method. Associated
companies are those companies in which the group generally has between 20% and 50% of the
voting rights, or over which the group exercises significant influence, but which it does not control.
Equity accounting involves recognising in the income statement the group’s share of the
associate’s post-acquisition results net of taxation and non-controlling interests in the associate.
The group’s share of post-acquisition movements in reserves is accounted for in the other
comprehensive income of the group. The group’s interest in the associate is carried on the
statement of financial position at cost, adjusted for the group’s share of the change in post-
acquisition net assets, and inclusive of goodwill and other identifiable intangible assets
recognised on acquisitions. Where the group’s share of losses exceeds the carrying amount of its
investment, the carrying amount of the investment as well as any loans to the associate are
reduced to nil and no further losses are recognised, unless the group has incurred obligations to
the associate or the group has guaranteed or committed to satisfy obligations of the associate.
Unrealised gains and losses on transactions between the group and its associates are eliminated
to the extent of the group’s interest in the associates, unless the loss provides evidence of an
impairment of the asset transferred. All major foreign associates have December year-ends, and
the group’s accounting policy is to account for a three-month lag period in reporting their results.
Any significant transactions that occurred between December and the group’s March year-end
are taken into account. Accounting policies of associated companies have been changed where
necessary to ensure consistency with the policies adopted by the group.
Partial disposals of associates that do not result in a loss of significant influence are accounted for
as dilutions. Dilution profits and losses relating to associated companies are accounted for in the
income statement. The proportionate share of any gains or losses previously recognised in other
comprehensive income are also reclassified to the income statement.
The group applies the (cid:2130)cost of each purchase” method for step acquisitions of associates. With this
method the cost of an associate acquired in stages is measured as the sum of the consideration
paid for each purchase plus a share of the investee’s profits and other equity movements. Any
other comprehensive income recognised in prior periods in relation to the previously held stake in
the acquired associate is reversed through equity and a share of profits and other equity
movements is also recorded in equity. Any acquisition-related costs are treated as part of the
investment in the associate.
When the group increases its shareholding in an associate and continues to have significant
influence, the group adds the cost of the additional investment to the carrying value of the
associate. The goodwill arising is calculated based on the fair value information at the date the
additional interest is acquired.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
19
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(a) Basis of consolidation (continued)
Joint ventures
The group’s interest in jointly controlled entities is accounted for by way of proportionate
consolidation. The group combines its share of the joint ventures’ individual income and
expenses, assets and liabilities and cash flows on a line-by-line basis with similar items in the
group’s financial statements. The group recognises the portion of gains or losses on the sale of
assets by the group to the joint venture that is attributable to the other venturers. The group does
not recognise its share of gains or losses from the joint venture that results from the purchase of
assets by the group from the joint venture until it resells the assets to an independent third party.
However, if a loss on the transaction provides evidence of a reduction in the net realisable value
of current assets or an impairment loss, the loss is recognised immediately. Where necessary,
accounting policies for joint ventures have been changed to ensure consistency with the policies
adopted by the group.
Disposals
When the group ceases to have control (subsidiaries) or significant influence (associates), any
retained interest in the entity is remeasured to its fair value, with the change in the carrying
amount recognised in profit or loss. The fair value is the initial carrying amount for the purposes
of subsequent accounting for the retained interest as an associate, joint venture or financial
asset. In addition, any amounts previously recognised in other comprehensive income in respect
of that entity are accounted for as if the group had directly disposed of the related assets or
liabilities. This may mean that amounts previously recognised in other comprehensive income are
reclassified to profit or loss.
(b) Investments
The group classifies its investments in debt and equity securities into the following categories: at
fair value through profit or loss, held-to-maturity, available-for-sale and loans and receivables. The
classification is dependent on the purpose for which the investments were acquired.
Management determines the classification of its investments at the time of purchase and
re-evaluates such designation on an annual basis. At fair value through profit or loss assets has
two subcategories: financial assets held-for-trading and those designated as at fair value through
profit or loss at inception. A financial asset is classified into this category at inception if acquired
principally for the purpose of selling in the short term, if it forms part of a portfolio of financial
assets in which there is evidence of short-term profit-taking, or, if permitted to do so, designated
by management. For the purpose of these financial statements short term is defined as a period
of three months or less. The group does not hold financial assets for trading, therefore assets
held as at fair value through profit or loss are designated as such on initial recognition. Derivatives
are also classified as held-for-trading unless they are designated as hedges. The group has no at
fair value through profit or loss or available-for-sale investments for the years ended 31 March
2011 and 31 March 2010.
Investments with a fixed maturity that management has the intent and ability to hold to maturity
are classified as held-to-maturity and are included in non-current assets, except for maturities
within 12 months from the statement of financial position date, which are classified as current
assets. Loans and receivables are non-derivative financial assets with fixed or determinable
payments that are not quoted in an active market other than those that the group intends to sell
in the short term or that it has designated as at fair value through profit or loss or available-for-
sale. Loans and receivables are included in non-current assets, except for maturities within
12 months from the statement of financial position date, which are classified as current assets.
All other investments, including those that are intended to be held for an indefinite period of time,
which may be sold in response to needs for liquidity, changes in fair value or interest rates, are
classified as available-for-sale. Available-for-sale assets are included in non-current assets unless
management has the express intention of holding the investment for less than 12 months from
20
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(b) Investments (continued)
the statement of financial position date or unless they will need to be sold to raise operating
capital, in which case they are included in current assets.
Purchases and sales of investments are recognised on the trade date, which is the date that the
group commits to purchase or sell the asset. Investments are initially recognised at fair value
plus, in the case of all financial assets not carried at fair value through profit or loss, transaction
costs that are directly attributable to their acquisition. At fair value through profit or loss and
available-for-sale investments are subsequently carried at fair value. Held-to-maturity investments
and loans and receivables are carried at amortised cost using the effective yield method.
Realised and unrealised gains and losses arising from changes in the fair value of at fair value
through profit or loss investments are included in the income statement in the period in which
they arise. Unrealised gains and losses arising from changes in the fair value of investments
classified as available-for-sale are recognised in other comprehensive income.
The fair values of investments are based on quoted bid prices or amounts derived from cash flow
models. Fair values for unlisted equity securities are estimated using applicable price:earnings or
price:cash flow ratios refined to reflect the specific circumstances of the issuer. Equity securities
for which fair values cannot be measured reliably are recognised at cost less impairment. When
securities classified as available-for-sale are sold or impaired, the accumulated fair value
adjustments are included in the income statement as (cid:2130)gains on acquisitions and disposals”.
Investments are derecognised when the rights to receive cash flows from the investments have
expired or where they have been transferred and the group has also transferred substantially all
risks and rewards of ownership.
(c) Property, plant and equipment
Property, plant and equipment are stated at cost, being the purchase cost plus any cost to
prepare the assets for their intended use, less accumulated depreciation and any accumulated
impairment losses. Cost includes transfers from equity of any gains/losses on qualifying cash flow
hedges of foreign currency purchase costs. Property, plant and equipment, with the exception of
land, are depreciated in equal annual amounts over each asset’s estimated useful life to their
residual values. Land is not depreciated as it is deemed to have an indefinite life. Depreciation
periods vary in accordance with the conditions in the relevant industries, but are subject to the
following range of useful lives:
(cid:96) Buildings
(cid:96) Manufacturing equipment
(cid:96) Office equipment
(cid:96) Improvements to buildings
(cid:96) Computer equipment
(cid:96) Vehicles
(cid:96) Transmission equipment
20 – 50 years
1 – 25 years
2 – 17 years
4 – 50 years
1 – 10 years
2 – 10 years
5 – 20 years
The group applied the component approach whereby parts of some items of property, plant and
equipment may require replacement at regular intervals. The carrying amount of an item of
property, plant and equipment will include the cost of replacing the part of such an item when
that cost is incurred if it is probable that future economic benefits will flow to the group and the
cost can be reliably measured. The carrying amount of those parts that are replaced is
derecognised on disposal or when it is withdrawn from use and no future economic benefits are
expected from its disposal. Each part of an item of property, plant and equipment with a cost
that is significant in relation to the total cost of the item is depreciated separately.
Major leasehold improvements are amortised over the shorter of their respective lease periods
and estimated useful economic life.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
21
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(c) Property, plant and equipment (continued)
Borrowing costs directly attributable to the acquisition, construction or production of qualifying
assets are capitalised as part of the cost of those assets. All other borrowing costs are expensed
in the period in which they are incurred. A qualifying asset is an asset that takes more than a year
to get ready for its intended use or sale. Borrowing costs are interest and other costs that the
group incur in connection with the borrowing of funds. This includes interest expenses calculated
using the effective interest method, finance charges in respect of finance leases and exchange
differences arising from foreign currency borrowings’ interest cost. Where a range of debt
instruments are used to borrow funds, or where the financing activities are coordinated centrally,
a weighted average capitalisation rate is applied.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the group and the cost of the item can be measured reliably. All other repairs and
maintenance are charged to the income statement during the financial period in which they are
incurred. The cost of major renovations is included in the carrying amount of the asset when it is
probable that future economic benefits will flow to the group and the cost can be reliably
measured. Major renovations are depreciated over the remaining useful economic life of the
related asset.
The carrying values of property, plant and equipment are reviewed periodically to assess whether
or not the net recoverable amount has declined below the carrying amount. In the event of such
impairment, the carrying amount is reduced and the reduction is charged as an expense against
income.
The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each
statement of financial position date. Gains and losses on disposals are determined by comparing
the proceeds with the asset’s carrying amount and are recognised within (cid:2130)other gains/losses –
net” in the income statement.
Work in progress is defined as assets still in the construction phase and not yet available for use.
These assets are carried at initial cost and are not depreciated. Depreciation on these assets
commence when they become available for use and depreciation periods are based on
management’s assessment of their useful lives.
(d) Leased assets
Leases of property, plant and equipment, except land, are classified as finance leases where,
substantially all risks and rewards associated with ownership of an asset are transferred from the
lessor to the group as lessee. Assets classified as finance leases are capitalised at the lower of
the fair value of the leased asset and the estimated present value of the underlying minimum
lease payments, with the related lease obligation recognised at the estimated present value of
the minimum lease payments. Bank rates are used to calculate present values of minimum lease
payments. Capitalised leased assets are depreciated over their estimated useful lives, limited to
the duration of the lease agreement. Each lease payment is allocated between the liability and
finance charges so as to achieve a constant rate on the finance balance outstanding. The
corresponding rental obligations, net of finance charges, are included in other long- or short-term
payables. The interest element of the finance cost is charged to the income statement over the
lease period so as to produce a constant periodic rate of interest on the remaining balance of the
liability for each period.
Leases of assets under which substantially all the risks and rewards of ownership are effectively
retained by the third-party lessor are classified as operating leases. Operating lease rentals (net of
any incentives received from the lessor) are charged to the income statement on a straight-line
basis over the period of the lease.
22
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(e) Intangible assets
Patents, brand names, trademarks, title rights, concession rights, software and other similar
intangible assets acquired are capitalised at cost. Intangible assets with indefinite useful lives are
not amortised, but tested for impairment annually as well as when an indication of possible
impairment exists, and carried at cost less accumulated impairment losses. Where the carrying
amount exceeds the recoverable amount, it is adjusted for impairment. Intangible assets with
finite useful lives are being amortised using the straight-line method over their estimated useful
lives. The useful lives and residual values of intangible assets are reassessed on an annual basis.
Amortisation periods for intangible assets with finite useful lives vary in accordance with the
conditions in the relevant industries, but are subject to the following maximum limits:
(cid:96) Patents
(cid:96) Title rights
(cid:96) Brand names and trademarks
(cid:96) Software
(cid:96) Intellectual property rights
(cid:96) Subscriber base
5 years
20 years
30 years
10 years
30 years
11 years
No value is attributed to internally developed trademarks or similar rights and assets. The costs
incurred to develop these items are charged to the income statement in the period in which they
are incurred.
The fair values of intangible assets with finite or infinite useful lives may be revalued due to
valuation differences that arise on business combinations.
This does not signify that the group has elected to apply an accounting policy of revaluing these
items after initial recognition. The valuation and impairment testing of intangible assets requires
significant judgement by management.
Work in progress is defined as assets still in the construction phase and not yet available for use.
These assets are carried at initial cost and are not amortised. Amortisation on these assets
commence when they become available for use and amortisation periods are based on
management’s assessment of their useful lives.
(f) Programme and film rights
Programme material rights
Purchased programme and film rights are stated at acquisition costs less accumulated
amortisation. Programme material rights, which consist of the rights to broadcast programmes,
series and films, are recorded at the date the rights come into license at the spot rates on the
purchase date. The rights are amortised based on contracted screenings or expensed where
management have confirmed that it is their intention that no further screenings will occur.
Programme material rights contracted by the reporting date in respect of programmes, series
and films not yet in license are disclosed as commitments.
Programme production costs
Programme production costs, which consist of all costs necessary to produce and complete a
programme to be broadcast, are recorded at the lower of direct cost or net realisable value. Net
realisable value is set at the average cost of programme material rights.
Programme production costs are amortised based on contracted screenings or expensed where
management have confirmed that it is their intention that no further screenings will occur.
All programme production costs in excess of the expected net realisable value of the production
on completion, are expensed when contracted.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
23
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(f) Programme and film rights (continued)
Sports events rights
Sports events rights are recorded at the date that the period to which the events relate,
commences at the rate of exchange ruling at that date. These rights are expensed over the
period to which the events relate or where management has confirmed that it is its intention that
the event will not be screened.
Payments made to negotiate and secure the broadcasting of sports events are expensed as
incurred. Rights to future sports events contracted by the reporting date, but which have not yet
commenced, are disclosed as commitments, except where payments have already been made,
which are shown as prepaid expenses.
(g) Impairment
Financial assets
The group assesses, at each statement of financial position date or when an indication of
possible impairment exists, whether there is any objective evidence that an investment or group
of investments is impaired. If any such evidence exists, the entity applies the following principles
for each class of financial asset to determine the amount of any impairment loss.
Financial assets carried at amortised cost
If there is objective evidence that an impairment loss on loans and receivables or held-to-maturity
investments carried at amortised cost has been incurred, the amount of the loss is measured as
the difference between the asset’s carrying amount and the present value of estimated future
cash flows (excluding future credit losses that have not been incurred) discounted at the financial
asset’s original effective interest rate (ie the effective interest rate computed at initial recognition).
The carrying amount of the asset is reduced directly through profit and loss. An impairment loss
recognised on an asset in a previous period is written back through profit and loss if the
estimates used to calculate the recoverable amount have changed since the previous impairment
loss was recognised. The reversal shall not result in a carrying amount of the financial asset that
exceeds what the amortised cost would have been had the impairment not been recognised at
the date the impairment is reversed. The reversal is recognised in the income statement in the
same line as the original impairment charge.
Available-for-sale financial assets
When a decline in the fair value of an available-for-sale financial asset has been recognised
directly in other comprehensive income and there is objective evidence that the asset is impaired,
the cumulative loss that had been recognised directly in other comprehensive income shall be
removed from other comprehensive income and recognised in profit or loss even though the
financial asset has not been derecognised. Impairment losses recognised in profit or loss for an
investment in an equity instrument classified as available-for-sale shall not be reversed through
profit or loss.
If, in a subsequent period, the fair value of a debt instrument classified as available-for-sale
increases and the increase can be objectively related to an event occurring after the impairment
loss was recognised in profit or loss, the impairment loss shall be reversed, with the amount of
the reversal recognised in profit or loss.
Other assets
The group evaluates the carrying value of assets with finite useful lives annually and when events
and circumstances indicate that the carrying value may not be recoverable. Indicators of possible
impairment include but are not limited to: significant underperformance relative to expectations
based on historical or projected future operating results, significant changes in the manner of use
of the assets or the strategy for the group’s overall business, significant negative industry or
24
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(g) Impairment (continued)
Other assets (continued)
economic trends and a significant and sustained decline in an investment’s share price or market
capitalisation relative to its net asset value. Intangible assets that have indefinite useful lives are
not subject to amortisation and are tested annually for impairment or when an indication of
possible impairment exists.
An impairment loss is recognised in the income statement when the carrying amount of an asset
exceeds its recoverable amount. An asset’s recoverable amount is the higher of the asset’s fair
value less cost to sell, or its value in use. Value in use is the present value of estimated future
cash flows expected to arise from the continuing use of an asset and from its disposal at the end
of its useful life. The estimated future cash flows are discounted to their present value using a
pre-tax discount rate that reflects current market assessments of the time value of money and
the risks specific to the asset. For the purposes of assessing impairment, assets are grouped at
the lowest levels for which there are separately identifiable cash flows.
An impairment loss recognised for an asset in prior years is reversed if there has been a change
in the estimates used to determine the asset’s recoverable amount since the last impairment loss
was recognised and the recoverable amount exceeds the new carrying amount. The reversal of
the impairment is limited to the carrying amount that would have been determined (net of
depreciation or amortisation) had no impairment loss been recognised in prior years. The reversal
of such an impairment loss is recognised in the income statement in the same line item as the
original impairment charge.
(h) Development activities
Research and development costs
Research expenditure is recognised as an expense as incurred. Costs incurred on development
projects (relating to the design and testing of new or improved products) are recognised as
intangible assets when it is probable that the project will be profitable considering its commercial
and technical feasibility and its costs can be measured reliably. Other development expenditures
that do not meet these criteria are recognised as an expense as incurred. Development costs
previously recognised as an expense are not recognised as an asset in a subsequent period.
Capitalised development costs are recorded as intangible assets and amortised from the point at
which the asset is ready for use on a straight-line basis over its useful life, not exceeding the
limits stated in note (e). Development assets are tested for impairment annually and the
impairment loss is recognised in the income statement when the carrying amount of the asset
exceeds its recoverable amount. This loss is also reversed if there has been a change in the
estimates used to determine the asset’s recoverable amount since the last impairment loss was
recognised and the recoverable amount exceeds the new carrying amount. The reversal of the
impairment is limited to the carrying amount that would have been determined (net of
depreciation or amortisation) had no impairment loss been recognised in prior years. The reversal
of such an impairment loss is recognised in the income statement in the same line item as the
original impairment charge.
Software and website development costs
Costs that are directly associated with the production of identifiable and unique software
products controlled by the group, and which will probably generate economic benefits exceeding
costs beyond one year, are recognised as intangible assets. Direct costs include the software
development team’s employee costs and an appropriate portion of relevant overheads. All other
costs associated with developing or maintaining software programs are recognised as an
expense as incurred.
Website development costs are capitalised as intangible assets if it is probable that the expected
future economic benefits attributable to the asset will flow to the group and its cost can be
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
25
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(h) Development activities (continued)
Software and website development costs (continued)
measured reliably, otherwise these costs are charged against operating profit as the expenditure
is incurred.
(i)
Inventory
Inventory is stated at the lower of cost or net realisable value. The cost of inventory is determined
by means of the first-in first-out basis or the weighted average method. The majority of inventory
is valued using the first-in first-out basis, but for certain inventories with a specific nature and use
which differ significantly from other classes of inventory, the weighted average is used.
The cost of finished products and work in progress comprises raw materials, direct labour, other
direct costs and related production overheads, but excludes finance costs. Costs of inventories
include the transfer from other comprehensive income of any gains or losses on qualifying cash
flow hedges relating to inventory purchases. Net realisable value is the estimate of the selling
price, less the costs of completion and selling expenses. Provisions are made for obsolete,
unusable and unsaleable inventory and for latent damage first revealed when inventory items are
taken into use or offered for sale.
(j) Trade receivables
Trade receivables are recognised at fair value at the date of initial recognition, and subsequently
carried at amortised cost less provision made for impairment. A provision for impairment of trade
receivables is established when there is objective evidence that the group will not be able to
collect all amounts due according to the original terms of receivables. The amount of the
provision is the difference between the carrying amount and the estimated recoverable amount.
(k) Cash and cash equivalents
Cash and cash equivalents are carried in the statement of financial position at cost. Cash and
cash equivalents comprise cash on hand and deposits held at call with banks. Certain cash
balances are restricted from immediate use according to terms with banks or other financial
institutions. For cash flow purposes, cash and cash equivalents are presented net of bank
overdrafts.
(l) Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are
subsequently stated at amortised cost using the effective yield method. Any difference between
proceeds (net of transaction costs) and the redemption value is recognised in the income
statement over the period of the borrowings.
(m) Accounts payable
Trade payables are obligations to pay for goods or services that have been acquired in the
ordinary course of business from suppliers. Accounts payables are classified as current liabilities
if payment is due within one year (or in the normal operating cycle of the business if longer).
If not, they are presented as non-current liabilities.
(n) Provisions
Provisions are recognised when the group has a present legal or constructive obligation as a
result of past events, it is probable that an outflow of resources embodying economic benefits
will be required to settle the obligation and a reliable estimate of the amount of the obligation can
be made. Costs related to the ongoing activities of the group are not provided in advance.
The group recognises the estimated liability on all products still under warranty at the statement
of financial position date. The group recognises a provision for onerous contracts when the
26
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(n) Provisions (continued)
expected benefits to be derived from a contract are less than the unavoidable costs of meeting
the obligations under the contract. Restructuring provisions are recognised in the period in which
the group becomes legally or constructively committed to payment. Costs related to the ongoing
activities of the group are not provided in advance.
Provisions are reviewed at each statement of financial position date and adjusted to reflect the
current best estimate. Where the effect of the time value of money is material, the amount of a
provision is determined by discounting the anticipated future cash flows expected to be required
to settle the obligation at a pre-tax rate that reflects current market assessments of the time
value of money and the risks specific to the liability. The increase in the provision due to the
passage of time is recognised as interest expense.
(o) Taxation
Taxation rates
The normal South African company tax rate used for the year ending 31 March 2011 is
28% (2010: 28%). Deferred tax assets and liabilities for South African entities at 31 March 2011
have been calculated using the 28% (2010: 28%) rate, being the rate that the group expects
to apply to the periods when the assets are realised or the liabilities are settled. Secondary tax
on companies (STC) is calculated at 10% (2010: 10%), and capital gains tax is calculated
at 50% of the company tax rate. International tax rates vary from jurisdiction to jurisdiction.
Tax expense
The tax expense for the period comprises current and deferred tax. Tax is recognised in the
income statement, except to the extent that it relates to items recognised in other comprehensive
income or directly in equity. In this case the tax is also recognised in other comprehensive
income or directly in equity, respectively.
Current income tax
The current income tax charge is calculated on the basis of the tax laws enacted or substantially
enacted at the statement of financial position date in the countries where the company’s
subsidiaries, joint ventures and associates operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect to situations in which applicable
tax regulations are subject to interpretation. It establishes provisions where appropriate on the
basis of amounts expected to be paid to the tax authorities.
Deferred taxation
Deferred taxation is provided in full, using the statement of financial position liability method, for
all taxable or deductible temporary differences arising between the tax bases of assets and
liabilities and their carrying values for financial reporting purposes. However, deferred tax liabilities
are not recognised if they arise from the initial recognition of goodwill; deferred income tax is not
accounted for if it arises from initial recognition of an asset or liability in a transaction other than a
business combination that at the time of the transaction affects neither accounting nor taxable
profit or loss. Deferred income tax is determined using tax rates (and laws) that have been
enacted or substantially enacted by the statement of financial position date and are expected to
apply when the related deferred income tax asset is realised or the deferred income tax liability is
settled.
Using this method, the group is required to make provision for deferred taxation, in relation to an
acquisition, on the difference between the fair values of the net assets acquired and their tax
base. Provision for taxes, mainly withholding taxes, which could arise on the remittance of
retained earnings, is only made if there is a current intention to remit such earnings.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
27
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(o) Taxation (continued)
Deferred taxation (continued)
The principal taxable or deductible temporary differences arise from depreciation on property,
plant and equipment, other intangibles, provisions and other current liabilities, income received in
advance, STC credits, finance leases and tax losses carried forward. Deferred taxation assets are
recognised to the extent that it is probable that future taxable profit will be available against which
deductible temporary differences, unused tax losses and STC credits can be utilised.
Deferred taxation is provided on temporary differences arising on investments in subsidiaries and
associates, except where the timing of the reversal of the temporary difference is controlled by the
group and it is probable that the temporary difference will not reverse in the foreseeable future.
Secondary tax on companies (STC)
Dividends declared by South African companies are subject to STC, but the STC liability is
reduced by dividends received during the dividend cycle. Where the dividends received exceed
dividends declared within a cycle, there is no liability to pay STC. The potential tax benefit related
to excess dividends received is carried forward to the next dividend cycle. Where dividends
declared exceed the dividends received during a cycle, STC is payable at the current STC rate.
The STC expense is included in the taxation charge in the income statement in the period that
the dividend is paid. Deferred tax assets are recognised on unutilised STC credits to the extent
that it is probable that the group will declare future dividends to utilise such STC credits.
(p) Foreign currencies
The consolidated financial statements are presented in rand, which is the company’s functional
and presentation currency. However, the group separately measures the transactions of each of
its material operations using the functional currency determined for that specific entity, which in
most instances, but not always, is the currency of the primary economic environment in which
the operation conducts its business.
For transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions or the dates of the valuations where items are
remeasured. Foreign exchange gains and losses resulting from the settlement of such
transactions and from the translation at year-end exchange rates of monetary assets and
liabilities denominated in foreign currencies are recognised in the income statement, except when
deferred in other comprehensive income as qualifying cash flow hedges and qualifying net
investment hedges.
Translation differences on non-monetary financial assets and liabilities, such as equities held at
fair value through profit or loss, are reported as part of the fair value gain or loss. Translation
differences on non-monetary items, such as equities classified as available-for-sale financial
assets, are included in the valuation reserve in other comprehensive income.
For translation of group companies’ results
The results and financial position of all the group entities (none of which has the currency of a
hyperinflationary economy) that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
(i)
(ii)
Assets and liabilities for each statement of financial position presented are translated at the
closing rate at the date of that statement of financial position.
Income and expenses for each income statement are translated at average exchange rates
(unless this average is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at the
spot rate on the dates of the transactions).
28
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(p) Foreign currencies (continued)
For translation of group companies’ results (continued)
(iii) Components of equity for each statement of changes in equity presented are translated at
the historic rate.
(iv) All resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in
foreign entities, and of borrowings and other currency instruments designated as hedges of such
investments, are taken to shareholders’ equity. When a foreign operation is sold, such exchange
differences are recognised in the income statement as part of the “gains on acquisitions and
disposals”.
Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as the
foreign entity’s assets and liabilities and are translated at the closing rate.
(q) Derivative financial instruments
The group uses derivative instruments to reduce exposure to fluctuations in foreign currency
exchange rates and interest rates. These instruments mainly comprise foreign exchange
contracts, interest rate caps and interest rate swap agreements. Foreign exchange contracts
protect the group from movements in exchange rates by fixing the rate at which a foreign
currency asset or liability will be settled. Interest rate caps and swap agreements protect the
group from movements in interest rates. It is the policy of the group not to trade in derivative
financial instruments for economically speculative purposes.
The group documents at the inception of the transaction the relationship between hedging
instruments and hedged items, as well as its risk management objective and strategy for
undertaking various hedge transactions. The group also documents its assessment, both at
hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging
transactions are expected to be and have been highly effective in offsetting changes in fair values
or cash flows of hedged items. The fair values of various derivative instruments used for hedging
purposes are disclosed in note 38. Movements on the hedging reserve are shown in the
statement of comprehensive income.
Derivative financial instruments are recognised in the statement of financial position at fair value.
Derivatives are classified as non-current assets and liabilities except for derivatives with maturity
dates within 12 months of the statement of financial position date, which are then classified as
current assets or liabilities. The method of recognising the resulting gain or loss is dependent on
the nature of the item being hedged. The group designates derivatives as either (1) a hedge of
the fair value of a recognised asset or liability or firm commitment (fair value hedge), or (2) a
hedge of a forecast transaction or of the foreign currency risk of a firm commitment (cash flow
hedge), or (3) a hedge of a net investment in a foreign entity on the date a derivative contract is
entered into.
Changes in the fair value of derivatives that are designated and qualify as fair value hedges are
recorded in the income statement, along with changes in the fair value of the hedged asset or
liability that is attributable to the hedged risk.
Changes in the fair value of derivatives that are designated and qualify as cash flow hedges and
that are highly effective are recognised in other comprehensive income and the ineffective part of
the hedge is recognised in the income statement. Where the forecast transaction or firm
commitment, of which the foreign currency risk is being hedged, results in the recognition of an
asset or a liability, the gains and losses previously deferred in other comprehensive income are
transferred from other comprehensive income and included in the initial measurement of the cost
of the asset or liability. Otherwise, amounts deferred in other comprehensive income are
transferred to the income statement and classified as income or expense in the same periods
during which the hedged transaction affects the income statement.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
29
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(q) Derivative financial instruments (continued)
Certain derivative transactions, while providing effective economic hedges under the group’s risk
management policies, do not qualify for hedge accounting. Changes in the fair value of any
derivative instrument that do not qualify for hedge accounting are recognised immediately in the
income statement.
When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for
hedge accounting, any cumulative gain or loss existing in other comprehensive income at that
time remains in other comprehensive income and is recognised when the committed or forecast
transaction ultimately is recognised in the income statement. When a committed or forecast
transaction is no longer expected to occur, the cumulative gain or loss that was reported in other
comprehensive income is immediately transferred to the income statement.
Hedges of net investments in foreign entities are accounted for similarly to cash flow hedges.
Where the hedging instrument is a derivative, any gain or loss on the hedging instrument relating
to the effective portion of the hedge is recognised in other comprehensive income; the gain or
loss relating to the ineffective portion is recognised immediately in the income statement.
However, where the hedging instrument is not a derivative, all foreign exchange gains and losses
arising on translation are recognised in the income statement.
Embedded derivatives are derivative instruments that are embedded in another contract (host
contract). The group separates an embedded derivative from its host contract and accounts for it
separately, when its economic characteristics are not clearly and closely related to those of the
host contract. These separated embedded derivatives are classified as trading assets or liabilities
and marked to market through the income statement, provided that the combined contract is not
measured at fair value with changes through the income statement. The group classifies gains
and losses on embedded derivative instruments as follows: while the asset related to the
embedded derivative is recorded on the statement of financial position, any fair value adjustments
are recorded as part of “other finance income/(costs) – net”. Once the embedded derivative is
derecognised or realised, any foreign exchange gain or loss is recorded as part of “cost of
providing services and sale of goods” sold to match the cost of the item that was recognised in
operating profit during that period.
(r) Revenue recognition
Revenue comprises the fair value of the consideration received or receivable for the sale of goods
and services in the ordinary course of the group’s activities. Revenue is shown net of value added
tax (VAT), returns, rebates and discounts and after eliminating sales within the group.
The group recognises revenue when the amount of revenue can be reliably measured, it is
probable that future economic benefits will flow to the entity and when specific criteria have been
met for each of the group’s activities as described below. The group bases its estimates on
historical results, taking into consideration the type of customer, the type of transaction and the
specifics of each arrangement.
Product sales
Sales are recognised upon delivery of products and customer acceptance, net of sales taxes,
VAT and discounts and after eliminating sales within the group. No element of financing is
deemed present as the sales are made with credit terms, which are short term in nature.
Subscription fees
Pay-television and internet subscription fees are earned over the period the services are
provided. Subscription revenue arises from the monthly billing of subscribers for pay-television
and internet services provided by the group. Revenue is recognised in the month the service is
rendered. Any subscription revenue received in advance of the service being provided is recorded
as deferred income and recognised in the month the service is provided.
30
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(r) Revenue recognition (continued)
Circulation revenue
Circulation revenue is recognised net of estimated returns in the month in which the magazine or
newspaper is sold.
Book publishing and sales
Sales are recognised upon delivery of products and customer acceptance, net of sales taxes,
VAT and discounts, and after eliminating sales within the group.
Advertising revenues
The group mainly derives advertising revenues from advertisements published in its newspapers
and magazines, broadcast on its pay-television platforms and shown online on its websites and
instant-messaging windows. Advertising revenues from pay-television and print media products
are recognised upon showing or publication over the period of the advertising contract.
Publication is regarded to be when the print media product has been delivered to the retailer and
is available to be purchased by the general public. Online advertising revenues are recognised
over the period in which the advertisements are displayed.
Printing and distribution
Revenues from print and distribution services are recognised upon completion of the services
and delivery of the related product and customer acceptance, net of taxes, VAT and discounts,
and after elimination of sales within the group. The recognition of print services revenue is based
upon delivery of the product to the distribution depot and acceptance by the distributor of the
customer, or where the customer is responsible for the transport of the customers’ products,
acceptance by the customer or its nominated transport company. Revenues from distribution
services are recognised upon delivery of the product to the retailer and acceptance thereof.
Print and distribution services are separately provided by different entities within the group and
separately contracted for by third-party customers. Where these services are provided to the
same client, the terms of each separate contract are consistent with contracts where an
unrelated party provides one of the services. Revenue is recognised separately for print and
distribution services as the contracts are separately negotiated based on fair value for each
service.
Technology contracts and licensing
For contracts with multiple obligations (eg maintenance and other services), revenue from
product licences are recognised when delivery has occurred, collection of the receivables is
probable, and the revenue associated with delivered and undelivered elements are reliably
measured.
The group recognises revenue allocated to maintenance and support fees, for ongoing customer
support and product updates rateably over the period of the relevant contracts. Payments for
maintenance and support fees are generally made in advance and are non-refundable. For
revenue allocated to consulting services and for consulting services sold separately, the group
recognises revenue as the related services are performed.
The group enters into arrangements with network operators whereby application software is
licensed to network operators in exchange for a percentage of the subscription revenue they
earn from their customers. Where all of the software under the arrangement has been delivered,
the revenue is recognised as the network operator reports to the group its revenue share, which
is generally done on a quarterly basis. Under arrangements where the group has committed to
deliver unspecified future applications, the revenue earned on the delivered applications is
recognised on a subscription basis over the term of the arrangement.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
31
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(r) Revenue recognition (continued)
Contract publishing
Revenue relating to any particular publication is brought into account in the month that it is
published. Sales are recognised net of sales taxes, VAT and discounts, and after eliminating sales
within the group.
Decoder maintenance revenue
Decoder maintenance revenue is recognised over the period the service is provided.
e-Commerce revenue
e-Commerce revenue represents amounts receivable for services net of VAT and refunds. The
group recognises listing and related fees on listing of an item for sale and success fees and any
other relevant commission when a transaction is completed on the group’s websites.
(s) Other income
Interest and dividends received on available-for-sale financial assets are included in investment
income and not as part of the fair value movement in other comprehensive income. Interest is
accrued on the effective yield method and dividends are recognised when the right to receive
payment is established.
(t) Employee benefits
Retirement benefits
The group provides retirement benefits for its full-time employees, primarily by means of monthly
contributions to a number of defined contribution pension and provident funds in the countries in
which the group operates. The assets of these funds are generally held in separate trustee-
administered funds. The group’s contributions to retirement funds are recognised as an expense
in the period in which employees render the related service.
Medical aid benefits
The group’s contributions to medical aid benefit funds for employees are recognised as an
expense in the period during which the employees render services to the group.
Post-retirement medical aid benefit
Some group companies provide post-retirement healthcare benefits to their retirees. The
entitlement to post-retirement healthcare benefits is based on the employee remaining in service
up to retirement age and completing a minimum service period. The expected costs of these
benefits are accrued over the period of employment. Independent qualified actuaries carry out
annual valuations of these obligations. All actuarial gains and losses are recognised immediately
in the income statement. The actuarial valuation method used to value the obligations is the
projected unit credit method. Future benefits are projected using specific actuarial assumptions
and the liability to in-service members is accrued over their expected working lifetime. These
obligations are unfunded with the exception of the schemes of agreements entered into with
employees from Media24 Limited and Via Afrika Limited.
Termination benefits
Termination benefits are employee benefits payable as a result of either an entity’s decision to
terminate an employee’s employment before the normal retirement date or an employee’s
decision to accept voluntary redundancy in exchange for those benefits. The group recognises
these termination benefits when the group is demonstrably committed to either terminate the
employment of an employee or group of employees before the normal retirement date, or provide
termination benefits as a result of an offer made in order to encourage voluntary redundancy.
32
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(t) Employee benefits (continued)
Termination benefits (continued)
The group is demonstrably committed to a termination when the group has a detailed formal plan
(with specified minimum contents) for the termination and it is without realistic possibility of
withdrawal. Where termination benefits fall due more than 12 months after the reporting period,
they are discounted. In the case of an offer made to encourage voluntary redundancy, the
measurement of termination benefits are based on the number of employees expected to accept
the offer. Termination benefits are immediately recognised as an expense.
(u) Equity compensation benefits
The group grants share options/share appreciation rights (SARs) to its employees under a
number of equity compensation plans. In accordance with IFRS 2, the group has recognised an
employee benefit expense in the income statement, representing the fair value of share options/
SARs granted to the group’s employees. A corresponding credit to equity has been raised for
equity-settled plans, whereas a corresponding credit to liabilities has been raised for cash-settled
plans. The fair value of the options/SARs at the date of grant under equity-settled plans is
charged to income over the relevant vesting periods, adjusted to reflect actual and expected
levels of vesting. For cash-settled plans, the group remeasures the fair value of the recognised
liability at each reporting date and at the date of settlement, with any changes in fair value
recognised in profit or loss for the period.
A share option scheme/SAR is considered equity-settled when the option/gain is settled by the
issue of a Naspers N share. They are considered cash-settled when they are settled in cash or
any other asset, ie not by the issue of a Naspers N share. Each share trust deed and SAR plan
deed, as appropriate, indicates whether a plan is to be settled by the issue of Naspers shares
or not.
Where shares are held or acquired by subsidiary companies for equity compensation plans, they
are treated as treasury shares (see accounting policy below). When these shares are
subsequently issued to participants of the equity compensation plans on the vesting date, any
gains or losses realised by the plan are recorded in treasury shares.
(v) Share capital and treasury shares
Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new
shares or options are shown in equity as a deduction against share premium.
Where subsidiaries hold shares in the holding company’s share capital, the consideration paid to
acquire these shares including any attributable incremental external costs is deducted from total
shareholders’ equity as treasury shares. Where such shares are subsequently sold or reissued,
the cost of those shares are released, and any realised gains or losses are included in treasury
shares. Shares issued to or held by share incentive plans within the group are treated as treasury
shares until such time when participants pay for and take delivery of such shares. The same
applies to treasury shares held by joint ventures.
(w) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to
the chief operating decisionmaker. The chief operating decisionmaker, who is responsible for
allocating resources and assessing performance of the operating segments, has been identified
as the executive committee that makes strategic decisions. The group proportionally consolidates
its share of the results of its associated companies in the various reporting segments. This is
considered to be more reflective of the economic value of these investments.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
33
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(x) Discontinuing operations
A discontinuing operation results from the sale or abandonment of an operation that represents a
separate, major line of business and for which the assets, net profits or losses and activities can
be distinguished physically, operationally and for reporting purposes. The results of discontinuing
operations up to the point of sale or abandonment, net of taxation, are separately disclosed.
(y) Recently issued accounting standards
The International Accounting Standards Board (IASB) issued a number of standards,
amendments to standards and interpretations during the financial year ended 31 March 2011.
These amendments and standards will therefore be implemented by the group during the
financial years as set out below:
(i)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
Standards, amendments to standards and interpretations to existing standards effective in
the year ended 31 March 2011:
IFRS 3 (cid:2130)Business Combinations” (IFRS 3) and IAS 27 (cid:2130)Consolidated and Separate Financial
Statements” (IAS 27):
The amendments to IFRS 3 and IAS 27 were issued on 10 January 2008 and have a greater
emphasis on the use of fair value, focusing on changes in control as a significant economic
event and focusing on what is given to the vendor as consideration rather than to look at
what was given to achieve the acquisition. The group adopted these amendments with effect
1 April 2010 and has changed its accounting policy accordingly. The new accounting policies
as described under (cid:2130)Subsidiaries”, (cid:2130)Business combinations”, (cid:2130)Goodwill”, (cid:2130)Associates”, (cid:2130)Joint
Ventures” and (cid:2130)Disposals” resulted in remeasurements of R72m and acquisition related costs
of R109m recorded in the line item (cid:2130)Gains on acquisitions and disposals” in the income
statement.
IFRIC 17 (cid:2130)Distributions of Non-cash Assets to Owners” was issued on 27 November 2008
and clarifies the accounting treatment of non-cash dividend distributions. The group adopted
this interpretation with no material effect on the group’s financial statements.
IAS 7 (cid:2130)Statement of Cash Flows” has been amended and requires changes in interests in a
subsidiary that do not result in a loss of control to be recorded in financing activities as
opposed to investing activities. This amendment is effective retrospectively, resulting in the
restatement of the statement of cash flows. Preference dividends received are now recorded
in investing activities as opposed to financing activities. The total amount reallocated to
investing activities was R404m for the year ended 31 March 2010.
On 18 June 2009 the IASB issued amendments to IFRS 2 (cid:2130)Share-based Payment” that clarify
the accounting for group cash-settled share-based payment transactions in an individual
subsidiary’s separate financial statements. The group adopted these amendments with no
material effect on the group’s financial statements.
On 30 July 2008 amendments to IAS 39 (cid:2130)Financial Instruments: Recognition and
Measurement” were issued. They clarify two hedge accounting issues, namely (cid:2130)inflation in a
financial hedged item”, and also how a one-sided risk in a hedged item should be accounted
for. The group adopted these amendments with no material effect on the group’s financial
statements.
The amendments to IAS 32 (cid:2130)Financial Instruments: Presentation” clarifies the accounting
treatment when rights issues are denominated in a currency other than the functional
currency of the issuer. The amendment states that if such rights are issued pro rata to an
entity’s existing shareholders for a fixed amount of currency, they should be classified as
equity regardless of the currency in which the exercise price is denominated. The group
adopted these amendments with no material effect on the group’s financial statements.
34
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(y) Recently issued accounting standards (continued)
(cid:96)
(cid:96)
The amendments to IFRS 1 (cid:2130)First-time Adoption of IFRS” became effective during the year
ended 31 March 2011, but had no effect on the group’s financial statements.
The annual improvements issued by the IASB during 2008 and 2009 which are effective have
been adopted by the group with no material effect.
(ii) Standards, amendments and interpretations to existing standards that are not yet effective
and have not been earlier adopted by the group:
(cid:96)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
IFRIC 19 (cid:2130)Extinguishing Financial Liabilities with Equity Instruments” was issued on
26 November 2009 and clarifies the accounting treatment when an entity renegotiates the
terms of its debt with the result that its debt is partly or fully extinguished. The group will
adopt this interpretation in its financial year ending 31 March 2012 and is currently evaluating
the effects.
On 7 October 2010 the IASB issued amendments to IFRS 7 (cid:2130)Financial Instruments:
Disclosures on Derecognition” that will promote transparency in the reporting of transfer
transactions and improve users’ understanding of the risk exposures relating to transfers of
financial assets and the effect of those risks on an entity’s financial position. The group will
adopt these amendments in its financial year ending 31 March 2013 and is currently
evaluating the effects.
The amendment to IAS 12 (cid:2130)Income Taxes” was issued on 20 December 2010 and introduces
an exception to the normal rule that measurement of deferred tax in respect of an asset
depends on the asset’s expected manner of recovery. The exception applies to investment
property measured using the fair value model and introduces a rebuttable presumption that
such investment property is recovered entirely through sale. The group will adopt these
amendments in its financial year ending 31 March 2013 and is currently evaluating the
effects.
During 2008, 2009 and 2010 the IASB issued (cid:2130)Improvements to International Financial
Reporting Standards”. These are non-urgent but necessary improvements, and consist of
various amendments that the group has adopted during its financial year ended 31 March
2011 and will also adopt in its financial year ending 31 March 2012.
The revised IAS 24 (cid:2130)Related Party Disclosures” was issued on 4 November 2009 and
provides partial relief from the requirement for government-related entities to disclose details
of all transactions with the government and other government-related entities. It also clarifies
and simplifies the definition of a related party. The group will adopt this revised standard in its
financial year ending 31 March 2012 and is currently evaluating the effects.
IFRS 9 (cid:2130)Financial Instruments” was issued on 12 November 2009 and updated on
29 October 2010. It addresses classification and measurement of financial assets as the first
part of its project to replace IAS 39. It replaces the multiple classification and measurement
models in IAS 39 with a single model that has only two classification categories namely
amortised cost and fair value. The main change in the additions is that in cases where the fair
value option is taken for financial liabilities, the part of a fair value change due to an entity’s
own credit risk is recorded in other comprehensive income rather than to the income
statement, unless this creates an accounting mismatch. The group will adopt this revised
standard in its financial year ending 31 March 2014 and is currently evaluating the effects.
IFRS 10 (cid:2130)Consolidated Financial Statements” was issued on 12 May 2011, which resulted in
an amended IAS 27. The amended IAS contains the accounting and disclosure requirements
for investments in subsidiaries, joint ventures and associates when an entity elects to present
separate financial statements. IFRS 10’s objective is to establish principles for the
presentation and preparation of consolidated financial statements when an entity controls one
or more other entities. The group will adopt this new standard and amendment in its financial
year ending 31 March 2014 and is currently evaluating the effects.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
35
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
2. PRINCIPAL ACCOUNTING POLICIES (continued)
(y) Recently issued accounting standards (continued)
(cid:96)
(cid:96)
(cid:96)
(cid:96)
IFRS 11 (cid:2130)Joint Arrangements” was issued on 12 May 2011, which focuses on the accounting
for joint operations and joint ventures. The main change is that the new standard requires the
use of the equity method of accounting for interests in joint ventures thereby eliminating the
proportionate consolidation method. The group will adopt this new standard in its financial
year ending 31 March 2014 and is currently evaluating the effects.
IFRS 12 (cid:2130)Disclosure of Interest in Other Entities” was issued on 12 May 2011 and applies to
entities that have interests in subsidiaries, joint arrangements, associates or unconsolidated
entities. This resulted in the amendment of IAS 28. The amended IAS prescribes the
accounting for investments in associates and sets out the requirements for the application of
the equity method when accounting for investments in associates and joint ventures. IFRS 12
establishes disclosure objectives and specifies the minimum disclosures that an entity must
provide to meet those objectives. The group will adopt this new standard and amendment in
its financial year ending 31 March 2014 and is currently evaluating the effects.
IFRS 13 (cid:2130)Fair Value Measurements” was issued on 12 May 2011. It establishes a single
framework for measuring fair value which is required by other standards. The standard
applies to both financial and non-financial items measured at fair value. The group will adopt
this new standard in its financial year ending 31 March 2014 and is currently evaluating the
effects.
The IASB issued amendments to IFRIC 14 and IFRS 1, which are not applicable to the group.
The details of these are available on the IASB’s website at www.iasb.org.
3.
SIGNIFICANT ACQUISITIONS AND DIVESTITURES
Financial year ended 31 March 2011
In August 2010 the group consolidated its internet interests in Russia, acquiring a 28,7% interest in
Digital Sky Technologies (DST), a prominent internet company in Russian-speaking markets. DST was
renamed Mail.ru Group and listed on the London Stock Exchange in November 2010. In
consideration, the group contributed its 39,3% investment in Mail.ru Group and US$388m in cash.
In August 2010 the group acquired a 67,8% fully diluted interest in OLX Inc., an online classifieds
business. The fair value of the total purchase consideration was R1 044m (US$144m) cash. The
purchase price allocation (PPA) included tangible assets R3m, intangible assets R260m, cash R237m,
other current assets R59m, trade and other payables R35m, deferred tax liability R103m and the
balance to goodwill. The main factor contributing to the goodwill recognised is the company’s
presence in the classifieds sector in emerging markets. The recognised goodwill is not expected to be
deductible for income tax purposes. A non-controlling interest of R51m was recognised at the
acquisition date. This was measured using the proportionate share of the identifiable net assets.
In December 2010 the group increased its total economic interest to 71,5% on a fully diluted basis.
This was accounted for as a transaction with non-controlling interests. The difference of R34m
between net asset value and the purchase consideration was recorded in the equity. The revenue and
results from OLX since the acquisition date were not significant to the group’s consolidated results.
In September 2010 the group acquired a 73,9% fully diluted interest in Multiply Inc. which combines
social networking with an online marketplace. The fair value of the total purchase consideration was
R311m (US$44m) in cash. The group increased its holding in Multiply to 74,5% during November for
a purchase consideration of R13m (US$2m) of which R3m was allocated to equity.
The preliminary PPA included tangible assets R7m, intangible assets R80m, cash R3m, trade and
other receivables R2m, trade and other payables R1m, deferred tax liability R24m and the balance to
goodwill. The main factor contributing to the goodwill recognised is the company’s significant user
base in emerging markets. The recognised goodwill is not expected to be deductible for income tax
36
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
3.
SIGNIFICANT ACQUISITIONS AND DIVESTITURES (continued)
Financial year ended 31 March 2011 (continued)
purposes. A non-controlling interest of R17m was recognised at the acquisition date, and was
measured using the proportionate share of the identifiable net assets. The revenue and results from
Multiply since the acquisition date were not significant to the group’s consolidated results.
In December 2010 the group acquired 100% of Level Up! International Holdings for a cash purchase
consideration of R365m (US$51m). A PPA has not yet been performed and the difference between
the net asset value and purchase consideration of R279m was allocated to goodwill.
In February 2011 the group acquired 77,7% of DineroMail, Latin America’s leading internet payment
solution, for a cash purchase consideration of R206m (US$28m). A PPA has not yet been performed
and the difference between the net asset value and purchase consideration of R181m was allocated
to goodwill.
Total acquisition-related costs of R109m were recorded in (cid:2130)Gains on acquisitions and disposals” in
the income statement. Had the revenues and net results of all business combinations that occurred
in the period been included from 1 April 2010 it would not have had a significant effect on the group’s
consolidated revenue and net results.
Financial year ended 31 March 2010
During November 2009 the group contributed its 42,9% interest in Mail.ru as well as a cash
consideration of R771m to acquire a 39% interest in Mail.ru Internet N.V. which, subsequent to a
share swap, holds 100% of the investment in Mail.ru and Astrum Online Entertainment Holdings.
The group continues to equity-account the investment.
During October 2009 the group acquired 51% of Korbitec (Proprietary) Limited for cash of
R158m with an additional R51m contingent consideration. The group has recorded the purchase
consideration, based on a preliminary appraisal namely tangible assets R48m, intangible assets
R135m, liabilities R21m and the balance to goodwill. The non-controlling shareholders’ share of the
above is R79m. The revenues and profits from the acquisition were not significant to the group’s
consolidated results for the year.
In September 2009 the group acquired 94,8% (diluted interest of 91%) of Brazilian e-commerce group
BuscaPé.com Inc. for a consideration of approximately R2,7bn. This was funded from existing debt
facilities. A put option of R89m over the non-controlling shareholders’ interest is part of the purchase
consideration. The group has recorded the purchase consideration based on a preliminary appraisal
namely tangible assets R180m, intangible assets R394m, liabilities R228m and the balance to
goodwill. The revenues and profits from the acquisitions were not significant to the group’s
consolidated results for the year.
In June 2009 the group announced a public tender offer to acquire Bankier.pl. The group finalised
the transaction in August 2009 and acquired 83% of Bankier.pl. Subsequent to the initial 83% interest
acquired, the group also acquired the remaining non-controlling shareholders’ interest. The group has
recorded the total purchase consideration of R178m namely tangible assets R52m, intangible assets
R33m and the balance to goodwill. The revenues and profits from the acquisition were not significant
to the group’s consolidated results for the year.
The group also made some other acquisitions for a combined cost of approximately R522m.
Revenues and profits from these acquisitions were not significant to the group’s consolidated results.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
37
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
31 March
2011
R’m
31 March
2010
R’m
1 402
1 640
238
68
118
50
1 370
2 289
919
892
1 662
770
1 995
3 311
1 316
1 203
2 588
1 385
3
7
4
6 933
628
7 561
12 243
4 682
7 561
1 180
1 388
208
57
105
48
1 310
2 102
792
815
1 382
567
1 699
3 177
1 478
1 026
2 251
1 225
11
15
4
6 098
392
6 490
10 812
4 322
6 490
4.
PROPERTY, PLANT AND EQUIPMENT
Land and buildings – owned
Cost price
Accumulated depreciation and impairment
Land and buildings – leased
Cost price
Accumulated depreciation and impairment
Manufacturing equipment – owned
Cost price
Accumulated depreciation and impairment
Transmission equipment – owned
Cost price
Accumulated depreciation and impairment
Transmission equipment – leased
Cost price
Accumulated depreciation and impairment
Vehicles, computer and office equipment – owned
Cost price
Accumulated depreciation and impairment
Vehicles, computers and office equipment – leased
Cost price
Accumulated depreciation and impairment
Subtotal
Work in progress
Net book value
Total cost price
Accumulated depreciation and impairment
Net book value
38
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
4.
PROPERTY, PLANT AND EQUIPMENT (continued)
Land and
buildings
R’m
Manu-
facturing
equipment
R’m
Trans-
mission
equipment
R’m
Vehicles,
computers
and office
equipment
R’m
Total
R’m
1 April 2009
Cost
Accumulated depreciation and
impairment
1 457
1 945
3 653
2 005
9 060
(228)
(793)
(2 414)
(1 135)
(4 570)
Net book value at 1 April 2009
1 229
1 152
1 239
Joint venture activities
Foreign currency translation
effects
Transfer from other intangible
assets
Transferred to non-current assets
held-for-sale
Acquisition of subsidiaries
Acquisitions
Assets damaged by fire
Disposals/scrappings
Impairment
Depreciation
31 March 2010
Cost
Accumulated depreciation and
impairment
Net book value at
31 March 2010
Work in progress
31 March 2010
Total net book value at
31 March 2010
(1)
(15)
(3)
(13)
1
131
(21)
(21)
—
(50)
—
(2)
1
—
—
399
(120)
(6)
(2)
(112)
—
(138)
7
—
—
1 985
—
(130)
(52)
(397)
870
(4)
(36)
27
(1)
23
498
(3)
(15)
(3)
(319)
4 490
(5)
(191)
32
(14)
24
3 013
(144)
(172)
(57)
(878)
1 493
2 102
4 559
2 266
10 420
(256)
(792)
(2 045)
(1 229)
(4 322)
1 237
1 310
2 514
1 037
6 098
392
6 490
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
39
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
4.
PROPERTY, PLANT AND EQUIPMENT (continued)
Land and
buildings
R’m
Manu-
facturing
equipment
R’m
Trans-
mission
equipment
R’m
Vehicles,
computers
and office
equipment
R’m
Total
R’m
1 April 2010
Cost
Accumulated depreciation and
impairment
1 493
2 102
4 559
2 266
10 420
(256)
(792)
(2 045)
(1 229)
(4 322)
Net book value at 1 April 2010
1 237
1 310
2 514
1 037
6 098
Joint venture activities
Foreign currency translation
effects
Reclassifications
Transfer to other intangible assets
Transferred to non-current assets
held-for-sale
Acquisition of subsidiaries
Disposal of subsidiaries
Acquisitions
Disposals/scrappings
Impairment
Depreciation
31 March 2011
Cost
Accumulated depreciation and
impairment
Net book value at
31 March 2011
Work in progress
31 March 2011
Total net book value at
31 March 2011
—
(4)
3
(1)
(25)
3
(1)
333
(26)
—
(49)
—
(1)
1
—
—
—
—
192
(4)
—
(128)
—
(175)
—
—
—
—
—
1 040
—
—
(492)
(1)
(24)
(4)
(2)
—
40
(2)
600
(40)
(25)
(373)
(1)
(204)
—
(3)
(25)
43
(3)
2 165
(70)
(25)
(1 042)
1 758
2 289
4 973
2 595
11 615
(288)
(919)
(2 086)
(1 389)
(4 682)
1 470
1 370
2 887
1 206
6 933
628
7 561
In terms of IAS 8 (cid:2130)Accounting Policies, Changes in Accounting Estimates and Errors” an assessment
of the expected future benefits associated with property, plant and equipment was determined. Based
on the latest available and reliable information there was a change in the estimated useful life and
residual value, which resulted in an increase in depreciation of R0,6m (2010: decrease of R35,5m).
During the prior years fires damaged manufacturing equipment at the group’s printing plants. The net
book value of the assets damaged by these fires was R143,9m and was disclosed under (cid:2130)Other
gains/(losses) – net” in the income statement. These assets were written off, but were fully insured.
During the year the group received R185,7m (2010: R326,6m) from its insurers.
40
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
4.
PROPERTY, PLANT AND EQUIPMENT (continued)
The group recognised an impairment of property, plant and equipment with a net book value of
R24,6m (2010: R57,0m). The impairment loss has been included in (cid:2130)Other gains/(losses) – net” in the
income statement of which Rnil (2010: R51,8m) has been included in the pay-television segment,
R24,6m (2010: Rnil) has been included in the internet segment and Rnil (2010: R5,2m) in the print
segment. The recoverable amounts of the remaining assets have been determined based on a value
in use calculation. The impairments resulted from the recoverable amounts of the assets being lower
than the carrying value thereof.
The group has pledged property, plant and equipment with a carrying value of R2,1bn at 31 March
2011 (2010: R1,8bn) as security against certain term loans and overdrafts with banks.
Registers containing additional information on land and buildings are available for inspection at the
registered offices of the respective group companies. The directors are of the opinion that the
recoverable amount of each class of property exceeds the carrying amount at which it is included in
the statement of financial position.
5.
GOODWILL
Cost
Opening balance
Foreign currency translation effects
Acquisition of subsidiaries
Joint-venture activities
Contingent consideration adjustment
Reclassifications
Closing balance
Accumulated impairment
Opening balance
Acquisition of joint ventures
Foreign currency translation effects
Impairment
Closing balance
Net book value
31 March
2011
R’m
31 March
2010
R’m
17 051
(516)
1 802
85
(49)
(2)
18 371
431
—
(6)
668
1 093
17 278
15 407
(1 163)
2 766
24
—
17
17 051
49
1
(1)
382
431
16 620
The group recognised impairment losses on goodwill of R668,0m (2010: R381,9m) during the
financial year ended 31 March 2011 due to the fact that the recoverable amount of certain
cash-generating units were less than their carrying value. Included in the total impairment charge is
an amount of R306,5m (2010: R335,4m) which relates to our investment in GG Network S.A.
(Gadu-Gadu). Gadu-Gadu’s revenue model was negatively impacted by increased competition. The
group also impaired other smaller internet and print investments where growth has lagged. For the
impairment in Gadu-Gadu, management used a three-year projected cash flow model, a growth rate
of 2% and a loss of 15,8%. The impairment charges have been included in (cid:2130)Other gains/(losses) –
net” in the income statement of which R636,3m (2010: R335,4m) has been included in the internet
segment and R31,7m (2010: R46,5m) in the print segment. The recoverable amounts have been
based on value in use calculations.
During the year the group finalised the purchase price accounting for acquisitions in the prior year and
no significant adjustments were required.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
41
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
5.
GOODWILL (continued)
Impairment testing of goodwill
The group has allocated its goodwill to various cash-generating units. The recoverable amounts of these
cash-generating units have been determined based on either a value in use calculation or on a fair value
less costs to sell basis. The value in use is based on discounted cash flow calculations. The group
based its cash flow calculations on three-to-five year budgeted and forecast information approved by
senior management and the various boards of directors of group companies. Long-term average growth
rates for the respective countries in which the entities operate or where more appropriate, the growth
rate of the cash-generating units were used to extrapolate the cash flows into the future. Where the fair
value was used to calculate recoverable amounts, it is based on publicly traded market prices. The
discount rates used reflect specific risks relating to the relevant cash-generating units and the countries
in which they operate. The group allocated goodwill to the following groups of cash-generating units:
Net book
value of
goodwill
R’m
Basis of
determination
of recoverable
amount
Discount rate
applied to
cash flows
%
Growth rate
used to
extrapolate
cash flows
%
Groups of cash-generating units
Tradus plc.
MultiChoice South Africa group
BuscaPé.com Inc.
Aukro s.r.o.
OLX Inc.
Level Up! International Private
Holdings
Cloakware Inc.
Movile Internet Movel S.A.
DineroMail Inc.
Moonfish Media OÜ
Vatera.hu KFT
Entriq Inc.
Multiply Inc.
Trendsales SPA
Nimbuzz B.V.
MXit Lifestyle (Proprietary) Limited
Grupa Allegro
Digital Mobile Television
(Proprietary) Limited
Sanook! Online Limited
Irdeto Access B.V.
Molotok.ru (Russia)
Irdeto France S.A.S.
Various other units
6 699
3 824
2 321
1 192
644
266
231
194
168
157
150
128
126
117
103
90
86
75
60
59
58
55
475
17 278
Value in use
Value in use
Value in use
Value in use
Value in use
Note 1
Value in use
Value in use
Note 1
Value in use
Value in use
Value in use
Value in use
Note 1
Value in use
Value in use
Value in use
Value in use
Note 1
Value in use
Value in use
Value in use
Value in use
13,5
17,2
21,2
16,0
18,5
—
15,9
20,7
—
14,9
19,7
20,8
21,6
—
18,3
26,7
12,4
5,0
3,5
8,7
5,0
4,0
—
2,5
4,0
—
4,5
5,0
7,5
5,8
—
5,0
4,0
5,0
17,2
—
15,9
23,7
25,5
Various
3,5
—
2,5
5,0
9,5
Various
Note 1
The amounts of goodwill presented for the above cash-generating units represent acquisitions that were made during the
year and represent the excess of the purchase consideration over the fair value of the assets acquired. A post-tax discount
rate is applied as the value in use was determined using post-tax cash flows.
42
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
5.
GOODWILL (continued)
Goodwill represents the above cash-generating units’ ability to generate future cash flows, which is a
direct result of various factors, including customer relationships, technological innovations, content
libraries, the quality of the workforce acquired, supplier relationships and possible future synergies.
If one or more of the inputs were changed to a reasonable possible alternative assumption, there
would be no further significant impairments that would have to be recognised.
6.
OTHER INTANGIBLE ASSETS
Intellectual
property
rights and
patents
R’m
Sub-
scriber
base
R’m
Brand
names
and title
rights
R’m
Software
R’m
Total
R’m
1 April 2009
Cost
Accumulated amortisation and
impairment
Net book value at 1 April 2009
Joint-venture activities
Foreign currency translation
effects
Acquisition of subsidiaries
Acquisitions
Transfer to property, plant and
equipment
Reclassifications
Disposals
Impairment
Amortisation
31 March 2010
Cost
Accumulated amortisation and
impairment
Net book value at
31 March 2010
Work in progress 31 March 2010
Total net book value at
31 March 2010
812
2 880
3 389
468
7 549
(249)
(1 202)
(445)
563
—
(148)
—
37
—
1
—
—
(56)
1 678
2 944
—
(214)
208
32
(25)
(1)
(4)
—
(799)
—
(133)
630
3
1
—
—
(2)
(258)
(224)
244
(1)
1
74
166
(8)
—
(14)
—
(100)
(2 120)
5 429
(1)
(494)
912
238
(32)
—
(18)
(2)
(1 213)
662
2 775
3 875
659
7 971
(265)
(1 900)
(690)
(297)
(3 152)
397
875
3 185
362
4 819
157
4 976
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
43
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
6.
OTHER INTANGIBLE ASSETS (continued)
Intellectual
property
rights and
patents
R’m
Sub-
scriber
base
R’m
Brand
names
and title
rights
R’m
Software
R’m
Total
R’m
1 April 2010
Cost
Accumulated amortisation and
impairment
Net book value at 1 April 2010
Joint-venture activities
Foreign currency translation
effects
Acquisition of subsidiaries
Acquisitions
Transfer from property, plant and
equipment
Reclassifications
Disposals
Impairment and derecognition
Amortisation
31 March 2011
Cost
Accumulated amortisation and
impairment
Net book value at
31 March 2011
Work in progress
31 March 2011
Total net book value at
31 March 2011
662
2 775
3 875
659
7 971
(265)
(1 900)
397
—
(23)
10
5
—
—
—
(7)
(54)
875
6
(90)
337
24
4
3
(4)
(40)
(704)
(690)
3 185
—
(161)
136
3
—
—
(3)
(128)
(253)
(297)
362
(1)
18
106
238
(1)
(3)
—
(197)
(160)
(3 152)
4 819
5
(256)
589
270
3
—
(7)
(372)
(1 171)
617
2 992
3 835
971
8 415
(289)
(2 581)
(1 056)
(609)
(4 535)
328
411
2 779
362
3 880
6
3 886
The group recognised impairment losses on other intangible assets of R371,9m (2010: R2,0m) during
the financial year ended 31 March 2011 due to the fact that the recoverable amounts of certain
cash-generating units were less than their carrying values. Included in the total impairment charge is
an amount of R185,8m (2010: Rnil) which relates to our investment in Gadu-Gadu and R112,3m
(2010: Rnil) which relates to the derecognition of Media24 intangibles. The Gadu-Gadu impairment is
based on the same assumptions as disclosed in note 5 above. The impairment charges have been
included in (cid:2130)Other gains/(losses) – net” on the income statement of which R5,6m (2010: Rnil) has
been included in the pay-television segment; R180,6m (2010: Rnil) in the internet segment; R52,9m
(2010: Rnil) in the technology segment and R141,1m (2010: R2,0m) in the print segment. The
recoverable amounts have been based on value in use calculations with discount rates comparable to
those used in assessing the impairment of goodwill.
44
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
6.
OTHER INTANGIBLE ASSETS (continued)
In terms of IAS 8 an assessment of the expected future benefits associated with other intangible
assets was determined. Based on the latest available and reliable information there was a change in
the estimated useful life and residual value, which resulted in an increase in amortisation of R1,5m
(2010: decrease of R4,0m).
7.
INVESTMENTS AND LOANS
Investments in associates
Listed
Unlisted
Total investments in associates
Investments and loans
Loans to related parties
Unlisted
Nimbuzz B.V.
MXit Lifestyle International Limited
Sanook! Online Limited
Various other related parties
Total long-term loans to related parties
Loans and receivables
Unlisted
Welkom Yizani preference shares
Phuthuma Nathi preference shares
Other
Total loans and receivables
Accrued dividends included in preference shares
Total loans and receivables excluding accrued dividends
Short-term loans and receivables
Long-term loans and receivables
Total investments and loans
Investments classified on statement of financial position
Non-current investments and loans
Current investments and loans
Accrued dividends classified under other receivables
31 March
2011
R’m
31 March
2010
R’m
Notes
16 874
3 893
20 767
4 646
7 296
11 942
[a]
[b]
[b]
[b]
—
20
79
38
137
404
2 870
145
3 419
(120)
3 299
(141)
3 158
3 556
3 295
141
120
3 556
35
17
—
29
81
391
3 170
5
3 566
(144)
3 422
(3)
3 419
3 647
3 500
3
144
3 647
Notes
[a]
[b]
During 2011 the group increased its interest in Nimbuzz B.V. from an associate to a subsidiary.
The nature of these related party relationships are that of joint ventures and associates. The loan to Sanook! and
MXit is non-interest-bearing with no fixed terms of repayment.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
45
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
The market value of the group’s listed investments in associates at 31 March 2011 amounted to
R137,7bn (2010: R92,8bn). Tencent Holdings Limited contributed R125,3bn (2010: R92,7bn), Beijing
Media Corporation Limited R108,5m (2010: R95,9m) and Mail.ru Group, which was listed in
November 2010, R12,3bn (2010: Rnil). The valuation of total unlisted investments and loans, as
approved by the directors of the respective group companies, amounted to R7,2bn (2010: R10,8bn).
The decline in value of total unlisted investments and loans is mainly as a result of the Mail.ru Group
listing during the year.
Naspers has two major BEE ownership initiatives, Welkom Yizani Investments Limited ((cid:2130)Welkom
Yizani”), which holds ordinary shares in Media24 Holdings (Proprietary) Limited and Phuthuma Nathi
Investments Limited and Phuthuma Nathi Investments Limited 2 ((cid:2130)Phuthuma Nathi”) which holds
ordinary shares in MultiChoice South Africa Holdings (Proprietary) Limited. BEE participants funded
20% of their investment with cash and the remaining 80% was funded through the issuance of
preference shares to Naspers Limited and MIH Holdings Limited. These preference shares are
variable, cumulative, redeemable preference shares and are classified as loans and receivables.
The Welkom Yizani transaction was restructured during the year ended 31 March 2010. Welkom
Yizani redeemed 21,1 million preference shares at a nominal value and the group agreed to waive
R119m of arrear and accumulated undeclared preference dividends due to the group. The total
refinancing charge of R330m was included in (cid:2130)Other gains/(losses) – net” in the income statement
and in the corporate segment in the segment report. Preference dividends are calculated at a rate
of 65% (2010: 65%) of the prime interest rate. The carrying value for Welkom Yizani is R404,3m
(2010: R391,4m).
The Phuthuma Nathi transaction was not affected by the Welkom Yizani restructuring and the carrying
value for Phuthuma Nathi was R2,9bn (2010: R3,2bn) at 31 March 2011. Preference dividends are
calculated at a rate of 75% (2010: 75%) of the prime interest rate.
46
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
The following information relates to Naspers Limited’s financial interest in its significant subsidiaries,
over which the group has voting control through its direct and indirect interests in respective
intermediate holding companies and other entities:
Nature of business
Country of
incorporation
Func-
tional
currency
D
or I
Effective
percentage
interest*
2011
%
2010
%
Name of subsidiary
UNLISTED COMPANIES
Media24 Holdings (Proprietary) Limited
Paarl Media Group (Proprietary) Limited
Touchline Media (Proprietary) Limited
Boland Koerante (Eiendoms) Beperk
Via Afrika Limited
MIH Holdings Limited
MultiChoice South Africa Holdings
(Proprietary) Limited
Huntley Holdings (Proprietary) Limited
MIH (Mauritius) Limited
MIH B.V.
MultiChoice Africa Limited
Irdeto Access B.V.
Electronic Media Network Limited
SuperSport International Holdings
Limited
GG Network S.A.
MIH Allegro B.V.
QXL Poland
MIH Ricardo B.V.
Ricardo.ch AG
BuscaPé.com Inc.
85,0
85,0
85,0
85,0
85,0
100,0
80,0
80,0
100,0
100,0
100,0
100,0
80,0
80,0
South Africa
85,0 Print media company
85,0 Printing
South Africa
85,0 Publishing of magazines South Africa
85,0 Publishing of newspapers South Africa
South Africa
85,0 Publishing of books
South Africa
100,0 Investment holding
South Africa
80,0 Subscription television
ZAR
ZAR
ZAR
ZAR
ZAR
ZAR
ZAR
ZAR
USD
100,0 Investment holding
80,0 Internet service provider South Africa
British Virgin
Islands
The Netherlands EUR
100,0 Investment holding
100,0 Investment holding
USD
Mauritius
100,0 Technology development The Netherlands USD
ZAR
ZAR
80,0 Pay-TV content provider South Africa
80,0 Pay-TV content provider South Africa
100,0
100,0 Instant-messaging
Poland
97,0
97,0
100,0
100,0
94,7
services
97,0 Investment holding
97,0 Internet e-commerce
platform provider
100,0 Investment holding
100,0 Internet e-commerce
platform provider
94,8 Comparative shopping
and e-commerce
Netherlands
Poland
Netherlands
Switzerland
Brazil
PLN
EUR
PLN
EUR
CHF
BRL
BRL
Movile Internet Movel S.A.
64,7
54,0 Mobile value-added
Brazil
services
Korbitec (Proprietary) Limited
51,0
51,0 Property transfer
South Africa
ZAR
Bankier.pl S.A.
Multiply Inc.
OLX Inc.
Nimbuzz B.V.#
Level Up! International Private Holdings
DineroMail Inc.
100,0
76,4
83,9
51,6
100,0
79,7
e-commerce platform
100,0 Finance and tax portal
Poland
— Social shopping business United States
United States
— Classifieds
43,6 Internet related services Netherlands
— Internet related services Singapore
— Internet e-commerce
platform provider
United States
PLN
USD
USD
EUR
USD
USD
D
I
*
– Direct interest
– Combined direct and indirect effective interest
– The percentage interest shown is the financial effective interest, after adjusting for the interests of the group’s
equity compensation plans treated as treasury shares.
Note – A register containing the number and class of shares in all investments held as subsidiaries is available for
inspection at the group’s registered office.
#
– During 2011 the group increased its interest in Nimbuzz B.V. As at 31 March 2010 it was classified as an associate.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
47
D
I
I
I
I
D
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
I
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
The following information relates to Naspers Limited’s financial interest in its significant joint ventures,
over which the group has joint voting control through its direct and indirect interests in respective
intermediate holding companies and other entities:
Nature of business
Country of
incorporation
Func-
tional
currency
D
or I
Name of joint venture
UNLISTED COMPANIES
The Natal Witness Printing and
Publishing Company (Proprietary)
Limited
Effective
percentage
interest*
2011
%
2010
%
42,5
42,5
MXit Lifestyle (Proprietary) Limited
MIH India Global Internet Limited (ibibo)#
Pricetown s.r.o.
Glendover Ventures Limited
M-Web (Thailand) Limited
30,5
80,1
48,5
48,5
50,0
Publishing and printing
of newspapers
Instant-messaging
services
30,5
South Africa
ZAR
South Africa
90,0 Internet-related services
India
48,5 Classifieds
48,5 Classifieds
Czech Republic CZK
Cyprus
ZAR
INR
UAH
THB
100,0 Internet service provider Thailand
I
I
I
I
I
I
D
I
*
– Direct interest
– Combined direct and indirect effective interest
– The percentage interest shown is the financial effective interest, after adjusting for the interests of the group’s
equity compensation plans treated as treasury shares.
– Although ownership is greater than 50%, it is not consolidated as it is jointly controlled (refer to note 13).
#
Note – A register containing the number and class of shares in all investments held as joint ventures is available for
inspection at the group’s registered office.
Additional joint-venture disclosure
The following is the group’s interest in the combined summarised statements of financial position and
income statements of the joint ventures as per their financial statements:
Statement of financial position information
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Total shareholders’ equity
Total equity and liabilities
Income statement information
Revenue
Net loss
31 March
2011
R’m
31 March
2010
R’m
153
249
402
519
155
674
(272)
402
615
(40)
147
232
379
494
144
638
(259)
379
542
(108)
The group’s interest in the joint ventures’ capital commitments amounted to Rnil (2010: R17,0m) and
it had no interest in contingent liabilities at 31 March 2011 and 31 March 2010.
48
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
The following information relates to Naspers Limited’s financial interest in its significant associated
companies:
Nature of business
Country of
incorporation
Func-
tional
currency
D
or I
Effective
percentage
interest*
2011
%
2010
%
Name of associated company
LISTED COMPANIES
Tencent Holdings Limited
Beijing Media Corporation Limited
Mail.ru Group
29,1
— Internet-related services Russia
34,3
9,9
34,6 Internet-related services China
China
9,9 Print media advertising
and print-related services
CNY
CNY
RUB
UNLISTED COMPANIES
Abril S.A.
Mail.ru Internet N.V.
ACL Wireless Limited
Free State Cheetahs Rugby
(Proprietary) Limited
Natal Sharks (Proprietary) Limited
Hunan Titan Culture Exchange
Company Limited
Buzz City PTE Limited
Xin’an Media Company Limited (Anhui)
Level Up! Inc.
30,0
—
30,0
19,6
32,0
—
36,1
37,0
40,0
30,0 Print media
BRL
39,0 Internet-related services The Netherlands RUB
INR
30,0 Internet-related services
ZAR
19,6 Rugby operations
India
South Africa
Brazil
32,0 Rugby operations
37,4 Print media
South Africa
China
36,1 Internet-related services Singapore
37,0 Print media
China
Philippines
— Online gaming
ZAR
CNY
SGD
CNY
PHP
I
I
I
I
I
I
I
I
I
I
I
I
D
I
*
– Direct interest
– Combined direct and indirect effective interest
– The percentage interest shown is the financial effective interest, after adjusting for the interests of the group’s
equity compensation plans treated as treasury shares.
Note – A register containing the number and class of shares in all investments held as associates is available for
inspection at the group’s registered office.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
49
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
Investments in associated companies
Opening balance
Associated companies acquired – gross consideration
Net assets acquired
Goodwill and intangibles recognised
Deferred taxation recognised
Other
Associated companies sold
Share of current year other reserve movements
Share of equity-accounted results
Net income before amortisation
Net loss before amortisation
Taxation
Equity-accounted results due to purchase accounting
Amortisation of other intangible assets
Release of purchase accounting goodwill
Realisation of deferred taxation
Impairment of equity-accounted investments
Reversal of impairment of equity-accounted investments
Dividends received
Foreign currency translation adjustments
Dilution profit
31 March
2011
R’m
31 March
2010
R’m
11 942
3 078
10 667
891
2 889
199
(6)
(4)
(277)
2 601
3 438
4 328
(38)
(852)
(177)
(258)
—
81
(118)
95
(947)
(329)
1 461
17
876
(5)
3
(1)
250
2 417
3 066
(49)
(600)
(423)
(326)
(212)
115
(62)
—
(518)
(1 343)
64
Closing balance
20 767
11 942
The group recognised R3,3bn (2010: R2,1bn) as its share of equity-accounted results in the income
statement. Impairment losses on investments in associated companies of R117,6m (2010: R62,2m)
has been recorded during the financial year ended 31 March 2011 due to the fact that the
recoverable amounts of certain investments in associated companies were less than their carrying
values. The impairment charges and reversal have been included in (cid:2130)Impairment of equity-accounted
investments” on the income statement. The group sold its investment in Hunan Titan Culture
Exchange Company Limited in January 2011. Prior to the disposal an impairment of R95m, previously
recognised on the investment, was reversed.
Our share of associates’ other comprehensive income and reserves relates mainly to the revaluation
of the associates’ available-for-sale investments.
The recoverable amounts of the other unlisted investments have been based on value in use
calculations with discount rates comparable to those used in assessing the impairment of goodwill.
Refer to note 5.
50
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
Additional associate disclosure
The following are the combined summarised statements of financial position and income statements
of the associated companies as per their annual financial statements:
Statement of financial position information
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Total shareholders’ equity
Total equity and liabilities
Income statement information
Revenue
Operating profit
Net profit
31 March
2011
R’m
31 March
2010
R’m
39 121
34 137
73 258
5 448
19 448
24 896
48 362
73 258
36 772
11 406
9 938
10 997
22 380
33 377
5 874
10 689
16 563
16 814
33 377
28 323
8 083
7 035
The group’s interest in the associates’ contingent liabilities as at 31 March 2011 amounted to
R806,1m (2010: R247,3m).
The following are entities with more than 50% ownership, which are not consolidated:
Name of entity
DSTV Digital Terrestrial Zambia
Limited
BDK Polska Sp. z o.o.
Smart Village at Waterfall
(Proprietary) Limited
MIH India Global Internet Limited
New Media Publishers
(Proprietary) Limited
Zayle Investment (Proprietary)
Limited
Effective
percentage
interest
Country of
incorporation Reason for not consolidating
99,0
Zambia
51,0 Poland
Net asset value insignificant
Management agreement, joint control
55,0 South Africa
India
80,0
Management agreement, joint control
Management agreement, joint control
58,0 South Africa
Management agreement, joint control
65,0 South Africa
Management agreement, associate
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
51
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
7.
INVESTMENTS AND LOANS (continued)
The following entities are consolidated due to management control through shareholder agreements
even though ownership is less than 50%. These entities would normally be accounted for as
associates or investments, but are now consolidated:
Name of entity
MultiChoice Namibia (Proprietary) Limited
Details Nigeria Limited
DCC Cell Captive
Effective
percentage
interest
Country of
incorporation
49,0
49,0
0,0
Namibia
Nigeria
South Africa
The following entities have less than 20% ownership, but are classified as associates as significant
influence is established through either cooperation agreements, board representation, and the
placement of key management:
Name of entity
Beijing Media Corporation Limited
Vodacom Cheetahs (Proprietary) Limited
8.
PROGRAMME AND FILM RIGHTS
Cost price
– programme rights
– film rights
Accumulated amortisation
– programme rights
– film rights
Net book value
– programme rights
– film rights
Effective
percentage
interest
Country of
incorporation
9,9
8,2
China
South Africa
31 March
2011
R’m
31 March
2010
R’m
2 837
513
3 350
(1 559)
(304)
(1 863)
1 278
209
1 487
1 974
788
2 762
(1 044)
(420)
(1 464)
930
368
1 298
A significant portion of the group’s cash obligations under contracts for pay-television programming
and channels is denominated in US dollars. The group uses forward exchange contracts to hedge the
exposure to foreign currency risk. The group generally covers forward 50% to 100% of firm
commitments in foreign currency for up to two years.
At 31 March 2011 the group had entered into contracts for the purchase of programme and film
rights. The group’s commitments in respect of these contracts amounted to R7,7bn (2010: R8,7bn).
52
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
9.
DEFERRED TAXATION
Opening balance
Accounted for in income statement
Accounted for against reserves
Acquisition of subsidiaries and joint ventures
Foreign currency translation adjustments
Closing balance
31 March
2011
R’m
31 March
2010
R’m
(446)
217
(10)
(174)
65
(348)
(505)
80
182
(278)
75
(446)
The deferred tax assets and liabilities and movement thereon were attributable to the following items:
1 April
2010
R’m
Charged
to income
R’m
Charged
to equity
R’m
Acquisition
of sub-
sidiaries
and joint
ventures
R’m
Disposal
of sub-
sidiaries
and joint
ventures
R’m
Foreign
currency
translation
adjust-
ments
R’m
31 March
2011
R’m
Deferred taxation assets
Provisions and other current
liabilities
Capitalised finance leases
Income received in advance
405
104
78
Tax losses carried forward
1 596
STC credits
Derivatives
Other
Valuation allowance
Deferred taxation
liabilities
Property, plant and
equipment
Intangible assets
Other
252
149
255
2 839
1 734
1 105
454
959
138
1 551
Net deferred taxation
(446)
39
(59)
29
823
(94)
(19)
59
778
768
10
1
(269)
61
(207)
217
—
—
—
—
—
(6)
—
(6)
—
(6)
—
—
4
4
1
—
—
89
—
—
(4)
86
94
(8)
—
166
—
166
(10)
(174)
—
—
—
(20)
—
—
—
(20)
(21)
1
—
1
—
1
—
(2)
—
—
(68)
—
—
(5)
(75)
(74)
(1)
(2)
(66)
2
(66)
65
443
45
107
2 420
158
124
305
3 602
2 501
1 101
453
791
205
1 449
(348)
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
53
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
9.
DEFERRED TAXATION (continued)
1 April
2009
R’m
Charged
to income
R’m
Charged
to equity
R’m
Acquisition
of
subsidiaries
and joint
ventures
R’m
Foreign
currency
translation
adjust-
ments
R’m
31 March
2010
R’m
Deferred taxation assets
Provisions and other current liabilities
Capitalised finance leases
Tax losses carried forward
STC credits
Derivatives
Other
Valuation allowance
Deferred taxation liabilities
Property, plant and equipment
Intangible assets
Other
Net deferred taxation
370
186
1 780
334
6
291
2 967
1 812
1 155
328
1 051
281
1 660
(505)
23
(82)
116
(82)
20
64
59
240
(181)
132
(314)
(77)
(259)
78
—
—
—
—
120
—
120
—
120
—
—
(61)
(61)
18
—
19
—
—
2
39
8
31
—
309
—
309
181
(278)
(6)
—
(319)
—
3
(24)
(346)
(326)
(20)
(6)
(87)
(5)
(98)
78
405
104
1 596
252
149
333
2 839
1 734
1 105
454
959
138
1 551
(446)
Valuation allowances are created against the net deferred taxation assets, when it is probable that the
deferred taxation assets will not be realised in the near future, due to the timing on available tax loss
carry-forwards that arose on these losses or due to the uncertainty of the utilisation of STC credits.
Further valuation allowances have been raised when it is uncertain whether future taxable profits will
be available to utilise unused tax losses and timing differences.
South
Africa
R’m
532
508
Rest of
Africa
R’m
23
15
Latin
America
and USA
R’m
Europe
R’m
664
425
1 049
569
Asia
R’m
97
113
Other
R’m
136
104
Total
R’m
2 501
1 734
Valuation allowance – 2011
Valuation allowance – 2010
54
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
9.
DEFERRED TAXATION (continued)
The group has tax losses carried forward of approximately R6,9bn (2010: R5,3bn). A summary of the
tax losses carried forward at 31 March 2011 by tax jurisdiction and the expected expiry dates are set
out below:
Expires in year one
Expires in year two
Expires in year three
Expires in year four
Expires in year five
Expires after year five
South
Africa
R’m
22
—
—
—
—
1 760
1 782
Rest of
Africa
R’m
4
—
—
—
—
142
146
Asia
R’m
Europe
R’m
1
1
3
26
71
116
218
26
3
5
7
210
1 972
2 223
Latin
America
and USA
R’m
—
—
—
—
—
2 092
2 092
Other
R’m
—
—
4
—
—
402
406
Total
R’m
53
4
12
33
281
6 484
6 867
The ultimate outcome of additional taxation assessments may vary from the amounts accrued.
However, management believes that any additional taxation liability over and above the amount
accrued would not have a material adverse impact on the group’s income statement and
statement of financial position.
Deferred taxation assets and liabilities are offset when the income tax relates to the same fiscal
authority and there is a legal right to offset at settlement. The following amounts are shown in the
consolidated statement of financial position:
Classification on statement of financial position
Deferred tax assets
Deferred tax liabilities
31 March
2011
R’m
817
(1 165)
(348)
31 March
2010
R’m
814
(1 260)
(446)
The group recognised deferred income tax of R9,8m (charged 2010: R181,4m) to other
comprehensive income as a result of changes in the fair value of derivative financial instruments that
relate to forecast transactions or commitments.
Total deferred taxation assets amount to R816,8m (2010: R813,6m) of which R124,3m
(2010: R108,5m) will be utilised within the next 12 months and R692,5m (2010: R705,1m) after
12 months. Total deferred taxation liabilities amount to R1 164,6m (2010: R1 260,5m) of which R1,5m
(2010: R3,7m) will be utilised within the next 12 months and R1 163,1m (2010: R1 256,8m) after
12 months.
During the year a deferred tax asset of R148,4m has been recognised of which the utilisation thereof
depends on future taxable profits in excess of the profits arising from the reversal of existing taxable
temporary differences, and the entity has suffered a loss in either the current or preceding period.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
55
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
10.
INVENTORY
Carrying value
Raw materials
Finished products, trading inventory and consumables
Work in progress
Decoders, internet and associated components
Gross inventory
Provision for slow-moving and obsolete inventories
Net inventory
31 March
2011
R’m
31 March
2010
R’m
217
284
36
420
957
(226)
731
166
265
37
426
894
(201)
693
The total provision charged to write inventory down to net realisable value in the income statement
amounted to R192,4m (2010: R102,0m), and reversals of these provisions amounted to R25,0m
(2010: R2,0m). Inventories written down to net realisable value amounted to R0,9m (2010: R17,4m).
11. TRADE RECEIVABLES
Carrying value
Trade accounts receivable, gross
Less: Provision for impairment of receivables
3 179
(250)
2 929
2 665
(227)
2 438
The movement in the allowance account for impairment of trade receivables during the year was
as follows:
Provision for impairment of receivables
Opening balance
Additional provisions charged to income statement
Provisions reversed to income statement
Provisions utilised
Foreign currency translation effect
Other
(227)
(133)
42
57
8
3
(213)
(99)
32
38
17
(2)
Closing balance
(250)
(227)
56
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
11. TRADE RECEIVABLES (continued)
The ageing of trade receivables as well as the amount of provision per age class, for each of the
reportable segments (excluding associates), is presented below:
31 March 2011
Neither
past
due nor
impaired
R’m
30 days
and
older
R’m
60 days
and
older
R’m
90 days
and
older
R’m
120 days
and
older
R’m
Pay television
Provision
Total
Internet
Provision
Total
Technology
Provision
Total
Print
Provision
Total
Total
Provision
Total
620
—
620
696
—
696
150
—
150
792
—
792
2 258
—
2 258
267
(12)
255
37
(5)
32
34
(12)
22
168
(37)
131
506
(66)
440
53
(9)
44
13
(4)
9
14
(1)
13
31
(4)
27
111
(18)
93
49
(26)
23
11
(6)
5
14
(1)
13
14
(2)
12
88
(35)
53
Total
R’m
1 058
(83)
975
818
(69)
749
254
(27)
227
1 049
(71)
978
3 179
(250)
69
(36)
33
61
(54)
7
42
(13)
29
44
(28)
16
216
(131)
85
2 929
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
57
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
11. TRADE RECEIVABLES (continued)
31 March 2010
Neither
past
due nor
impaired
R’m
30 days
and
older
R’m
60 days
and
older
R’m
90 days
and
older
R’m
120 days
and
older
R’m
Pay television
Provision
Total
Internet
Provision
Total
Technology
Provision
Total
Print
Provision
Total
Total
Provision
Total
726
—
726
457
—
457
109
—
109
634
—
634
1 926
—
1 926
187
(23)
164
38
(7)
31
17
(1)
16
147
(6)
141
389
(37)
352
31
(24)
7
13
(4)
9
17
—
17
47
(1)
46
108
(29)
79
15
(11)
4
11
(8)
3
4
—
4
15
(3)
12
45
(22)
23
Total
R’m
997
(89)
908
563
(56)
507
201
(35)
166
904
(47)
857
38
(31)
7
44
(37)
7
54
(34)
20
61
(37)
24
197
(139)
2 665
(227)
58
2 438
MWEB is now reported in the pay-television rather than the internet segment. It is working on
technologies to deliver video content. Comparative segmental results have been restated.
58
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
12. OTHER RECEIVABLES
Prepayments and accrued income
Receivables from non-controlling shareholders
Staff debtors
VAT and related taxes receivable
Preference dividend accrual
Insurance proceeds
Transponder lease receivable
Promissory notes
Other receivables
31 March
2011
R’m
31 March
2010
R’m
939
—
15
325
120
—
14
373
353
960
10
10
202
144
152
82
—
311
2 139
1 871
13. RELATED PARTY TRANSACTIONS AND BALANCES
The group entered into transactions and has balances with a number of related parties, including
equity investees, joint ventures, directors, shareholders and entities under common control.
Transactions that are eliminated on consolidation are not included. The transactions and balances
with related parties are summarised below:
Sale of goods and services to related parties
New Media Publishers (Proprietary) Limited
Rodale & Touchline Publishers (Proprietary) Limited
Various other related parties
Note
[a]
[a]
[a]
83
12
12
107
83
—
20
103
Note
[a] The group receives revenue from a number of its related parties mainly for the printing and distribution of magazines
and newspapers. The nature of these related party relationships are that of joint ventures and associates.
Purchase of goods and services from related parties
MXit Lifestyle Development Company (Proprietary) Limited
New Media Publishers (Proprietary) Limited
Natal Witness Printing & Publishing Company
(Proprietary) Limited
Various other related parties
[a]
[a]
[a]
10
4
15
20
49
—
4
11
10
25
Note
[a] The group purchases goods and services from a number of its related parties mainly for the printing and distribution
of magazines and newspapers. The nature of these related party relationships are that of joint ventures and
associates.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
59
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
Other transactions with related parties
Tencent Holdings Limited ((cid:2130)Tencent”)
The group entered into a number of intellectual property and know-how licensing agreements with
Tencent. On 27 June 2002 Tencent granted a sole and exclusive licence to a group company to use,
and to authorise its affiliates ((cid:2130)the operators”), which carry on business in sub-Saharan Africa (including
South Africa), Indonesia, Thailand, Greece and Cyprus to use certain proprietary intellectual property and
know-how of Tencent for a licence fee computed at 40% of gross revenue derived by the operators by
using this proprietary information. The agreement is for a term of 15 years and expires in 2017.
MIH India Global Internet Limited ((cid:2130)MIH India”), a joint venture of the group, entered into a transaction
with Tencent, pursuant to which Tencent granted to MIH India and its subsidiaries a licence to use
Tencent’s technology and content in India in consideration of MIH India granting an option to Tencent
to subscribe for new shares of MIH India. The licence will be exclusive to MIH India for an initial period
of seven years. Upon termination of the exclusive period, the licence will continue on a non-exclusive
basis. Tencent will also provide additional support services to MIH India.
During March 2011 Tencent exercised a further 9,9% of its option in MIH India. At 31 March 2011
Tencent held a 19,9% interest in MIH India with the remaining 80,1% held by the group. The group has
performed an assessment, as required by IAS 27 (cid:2130)Consolidated and Separate Financial Statements”,
to determine whether the group would still exert control over MIH India in the event that the remaining
option is exercised. The option to acquire an additional interest is currently exercisable. Based on this
assessment, if Tencent were to exercise its option in full, all decisions made by the board of directors
would require approval by both the group and Tencent’s directors. As such, the group will exert joint
control, as defined in IAS 31 (cid:2130)Interests in Joint Ventures”, over MIH India with Tencent. The group has
proportionately consolidated its share of all assets, liabilities, income and expenses of MIH India.
The option granted falls within the scope of IFRS 2 (cid:2130)Share-based Payments”, as equity of the
company is being given in exchange for goods and services to be received. The group has therefore
performed a calculation to determine the fair value of the option during 2009, which amounted to
R31,5m and is being amortised over a seven-year period, being the licence period.
The balances of advances, deposits, receivables and payables between the group and related parties
are as follows:
31 March
2011
R’m
31 March
2010
R’m
Notes
Receivables
New Media Publishers (Proprietary) Limited
Various other related parties
Payables
Tencent Technology (Shenzhen) Company Limited
New Media Publishers (Proprietary) Limited
Various other related parties
[a]
[a]
[b]
[a]
[a]
24
14
38
79
7
7
93
20
6
26
—
2
7
9
Refer to note 7 for long-term loans to related parties.
Notes
[a] The group receives income and purchases goods and services from a number of its related parties mainly for the
printing and distribution of magazines and newspapers. The nature of these related party relationships are that of
joint ventures and associates.
[b] The 6% stake purchased by Tencent during December 2008 in MIH India resulted in a shareholder loan payable to
Tencent. The loan is non-interest-bearing with no fixed terms of repayment.
60
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
Directors’ emoluments
Non-executive directors:
Fees for services as directors
Fees for services as directors of subsidiary companies
31 March
2011
R’000
31 March
2010
R’000
7 649
5 241
12 890
6 409
5 247
11 656
No director has a notice period of more than one year.
No director’s service contract includes predetermined compensation as a result of termination that
would exceed one year’s salary and benefits.
The individual directors received the following remuneration and emoluments during the current
financial year:
Executive directors
2011
S J Z Pacak
J P Bekker
2010
S J Z Pacak
J P Bekker
Bonuses and
performance-
related fees
R’000
Salary
R’000
Pension
contributions
R’000
3 054
—
3 054
2 820
—
2 820
2 900
—
2 900
3 135
—
3 135
200
—
200
280
—
280
Total
R’000
6 154
—
6 154
6 235
—
6 235
Mr Pacak’s bonus is based on financial, operational and discrete objectives, which were approved by
the human resources and remuneration committee in advance. The bonus is capped at 100% of total
cost to company. Remuneration received by executive directors for other services paid by subsidiary
companies totalled R6,154m (2010: R6,235m).
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
61
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
The individual directors received the following remuneration and emoluments during the current
financial year:
Directors’ fees
Committee1 and
trustee2 fees
Directors’ fees
Committee1 and
trustee2 fees
Non-executive
directors
T Vosloo3
J J M van Zyl3, 4
L N Jonker4
N P van Heerden3
B J van der Ross
G J Gerwel3
H S S Willemse4
F-A du Plessis4
T M F Phaswana
L P Retief3
R C C Jafta3
D Meyer
Paid by
com-
pany
R’000
Paid by
subsi-
diary
R’000
Paid by
com-
pany
R’000
Paid by
subsi-
diary
R’000
2 011
379
379
379
379
379
379
379
379
379
379
379
1 407
791
—
85
—
590
—
—
—
1 350
197
—
—
517
45
—
163
165
45
339
—
—
195
—
109
211
—
—
—
70
—
—
—
133
298
—
Total
2011
R’000
3 527
1 898
424
464
542
1 204
424
718
379
1 862
1 069
379
Paid by
com-
pany
R’000
Paid by
subsi-
diary
R’000
Paid by
com-
pany
R’000
Paid by
subsi-
diaries
R’000
1 887
354
354
354
354
354
354
354
354
354
354
148
1 233
578
—
80
—
557
—
—
124
1 687
186
—
—
390
42
—
—
90
42
135
—
—
135
—
834
Total
2010
R’000
3 215
1 498
396
434
354
1 068
396
626
478
2 171
872
148
95
176
—
—
—
67
—
137
—
130
197
—
6 180
4 420
1 469
821
12 890
5 575
4 445
802
11 656
Notes
1 Committee fees include fees for the attendance of the audit committee, the risk committee (2011 only), the human
resources and remuneration committee, and the nomination committee meetings of the board.
2 Trustee fees include fees for the attendance of the various retirement fund trustee meetings of the group’s retirement
funds.
3 Directors’ fees include fees for services as directors, where appropriate, of Media24 Limited, Paarl Media Holdings
(Proprietary) Limited, Via Afrika Limited, MIH Holdings Limited, MIH (Mauritius) Limited, Myriad International Holdings B.V.
and MultiChoice South Africa (Proprietary) Limited.
4 Committee and trustee fees include, where appropriate, fees to be considered by shareholders at the annual general
meeting on 26 August 2011 for services as trustees or members, as appropriate, of the group’s share schemes/
retirement funds/Media24’s safety, health and environmental committee.
62
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
Directors’ interests in scheme shares of the Naspers share incentive scheme
The executive directors of Naspers are allowed to participate in the Naspers share incentive scheme.
Details as at 31 March 2011 in respect of the executive directors’ participation in scheme shares not
yet released, are as follows:
Name
J P Bekker1
S J Z Pacak2
Purchase
date
Number of
N shares
Purchase
price
Release
period
31/03/2008
31/03/2008
08/07/2006
3 895 936
3 895 936
50 000
R176,11
R185,56
R114,52
31/03/2012
31/03/2013
08/07/2011
Notes
1 The chief executive of Naspers has allocations, as indicated above, under the share incentive scheme, in terms of which
Naspers N ordinary shares can be acquired at certain prices, with the vesting of the various tranches taking place over
periods of five years. The purchase prices relating to the allocations were set at the middle market price of the shares
on the purchase date, but increased by anticipated inflation over the course of the vesting periods of three, four and five
years respectively, for each of the tranches. Inflation expectations were calculated by the Bureau for Economic Research
of the Stellenbosch University. The chief executive does not earn any remuneration from the group, in particular no
salary, bonus, car scheme, medical or pension contributions of any nature whatsoever. The chief executive’s contract is
for a five-year period which started on 1 April 2008. No compensation will apply to termination.
2 On 15 December 2010 a total of 15 000 released Naspers N ordinary shares were sold by Mr S J Z Pacak’s family trust
upon payment of an average price of R23,50 per share (the original average offer price based on the listed market price
of Naspers Limited N ordinary shares on the date of the offer) due to the Naspers share incentive trust, at an average
selling price of R392,01 per Naspers N ordinary share.
On 21 December 2010 a total of 10 000 released Naspers N ordinary shares were sold by Mr S J Z Pacak’s family trust
upon payment of an average price of R23,50 per share (the original average offer price based on the listed market price
of Naspers Limited N ordinary shares on the date of the offer) due to the Naspers share incentive trust, at an average
selling price of R390,00 per Naspers N ordinary share.
Directors’ interest in MIH (Mauritius) Limited share incentive scheme
At 31 March 2011 a total of 428 000 (2010: 556 000) unreleased Naspers N ordinary shares were
allocated to Mr S J Z Pacak with vesting periods until 27 February 2014.
Directors’ interest in Naspers shares
The directors of Naspers have the following interests in Naspers A ordinary shares on 31 March 2011:
31 March 2011
Naspers A ordinary shares
31 March 2010
Naspers A ordinary shares
Name
Beneficial
Direct
Indirect
J J M van Zyl
745
—
Total
745
Beneficial
Direct
Indirect
745
—
Total
745
Mr J P Bekker has an indirect 25% interest in Wheatfields 221 (Proprietary) Limited, which controls
168 605 Naspers Beleggings Beperk ordinary shares, 16 860 500 Keeromstraat 30 Beleggings
Beperk ordinary shares and 133 350 Naspers A shares.
No other director of Naspers had any direct interest in Naspers A ordinary shares at 31 March 2011
or 31 March 2010.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
63
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
The directors of Naspers (and their associates) have the following interests in Naspers N ordinary
shares on 31 March:
31 March 2011
Naspers N ordinary shares
Beneficial
31 March 2010
Naspers N ordinary shares
Beneficial
Name
Direct
Indirect
Total
Direct
Indirect
Total
T Vosloo
J P Bekker5
J J M van Zyl
L N Jonker
N P van Heerden
B J van der Ross1
G J Gerwel
H S S Willemse2
F-A du Plessis
T M F Phaswana3
L P Retief4
R C C Jafta
S J Z Pacak6
D Meyer
—
3 895 936
50 361
1 000
—
—
—
85
—
—
—
—
300 510
—
213 000
4 688 691
190 796
52 000
2 600
400
—
3 205
—
3 530
—
—
282 548
—
213 000
8 584 627
241 157
53 000
2 600
400
—
3 290
—
3 530
—
—
583 058
—
213 000
—
— 4 688 691
190 796
52 000
2 600
400
—
3 205
—
3 530
—
—
307 548
—
50 361
1 000
—
—
—
85
—
—
—
—
122 510
—
213 000
4 688 691
241 157
53 000
2 600
400
—
3 290
—
3 530
—
—
430 058
—
4 247 892
5 436 770
9 684 662
173 956
5 461 770
5 635 726
Notes
1 It has been ascertained that the Van der Ross Family Trust acquired 400 Naspers N ordinary shares on 18 August
2008. The comparatives have been adjusted accordingly. Furthermore, on 21 April 2011 this trust acquired
100 Naspers N ordinary shares. The trade was implemented by the investment manager without specific approval
from Mr van der Ross. The investment manager accepted full responsibility for the breach in the JSE Listings
Requirements.
2 In April 2004, in terms of a scheme of arrangement, Naspers acquired all the ordinary shares of M-Net and
SuperSport for a cash distribution and 4,2365 Naspers shares for every 100 linked units in M-Net/SuperSport. It has
been ascertained that Mr H S S Willemse and one of his associates were entitled to receive 85 Naspers N ordinary
shares each in terms of this transaction. The comparatives have been adjusted accordingly.
3 Mr T M F Phaswana’s shares were reclassified from direct to indirect. The comparatives have been adjusted accordingly.
4 The Media24 group entered into a contract with the Retief family trust in October 2008, which contains a put option
whereby the Retief family trust can enforce a buy-out by Media24 group of their remaining interest in Paarl Media
Holdings (Proprietary) Limited (currently 5%) and Paarl Coldset (Proprietary) Limited (currently 12,6%). Mr L P Retief,
a director of Naspers Limited, is a related party to the Retief family trust.
5 At 31 March 2011, 3 895 936 Naspers N ordinary shares at an offer price of R167,23 per share were released and
reserved for Mr J P Bekker in the Naspers share incentive scheme.
6 During the financial year Naspers N ordinary shares were released and reserved for Mr S J Z Pacak in the Naspers
group’s share incentive schemes.
Except as set out in note 1 above there have been no changes to the directors’ interests in the table
above between the end of the financial year and 24 June 2011.
Key management remuneration and participation in share-based incentive plans
Comparatives have not been restated to account for the change in the composition of key management.
The total of executive directors and key management emoluments amounted to R415,0m
(2010: R416,2m), comprising short-term employee benefits of R94,6m (2010: R93,6m), post-
employment benefits of R7,5m (2010: R7,1m) and a share-based payment charge of R312,9m
(2010: R315,5m). The aggregate number of share options granted to the executive directors and key
management during the 2011 financial year and the number of shares allocated to the executive
directors and key management at 31 March 2011 respectively are:
64
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
13. RELATED PARTY TRANSACTIONS AND BALANCES (continued)
For shares listed on a recognised stock exchange as follows: 31 358 (2010: 318 197) Naspers
Limited N ordinary shares were allocated during the 2011 financial year and an aggregate of
23 124 505 (2010: 23 292 521) N ordinary shares were allocated as at 31 March 2011.
For shares in unlisted companies as follows: nil (2010: nil) Media24 Limited ordinary shares were
allocated during the 2011 financial year and an aggregate of 4 840 (2010: 9 480) ordinary shares
were allocated as at 31 March 2011; nil (2010: nil) Irdeto Access B.V. ordinary shares were allocated
during the 2011 financial year and an aggregate of 200 000 (2010: 200 000) ordinary shares were
allocated as at 31 March 2011; nil (2010: nil) MIH China (BVI) Limited ordinary shares were allocated
during 2011 financial year and an aggregate of 18 084 (2010: 18 876) shares were allocated as at
31 March 2011; nil (2010: nil) Entriq (Mauritius) Limited shares were allocated during the 2011
financial year and an aggregate of 420 000 (2010: 420 000) shares were allocated as at 31 March
2011; nil (2010: nil) MediaZone Holdings B.V. shares were allocated during the 2011 financial year and
an aggregate of 100 000 (2010: 100 000) shares were allocated as at 31 March 2011; 440 000
(2010: 225 599) MIH India (Mauritius) Limited shares were allocated during the 2011 financial year and
an aggregate of 2 139 694 (2010: 2 799 758) shares were allocated as at 31 March 2011; 20 000
(2010: 367 586) MIH Russia Internet B.V. shares were allocated during the 2011 financial year and an
aggregate of 557 484 (2010: 553 960) shares were allocated as at 31 March 2011; nil (2010: 55 667)
MIH BuscaPé shares were allocated during the 2011 financial year and an aggregate of 55 667
(2010: 55 667) shares were allocated as at 31 March 2011.
For share appreciation rights (SARs) in unlisted companies as follows: 1 304 706 (2010: nil)
Media24 SARs were allocated during the 2011 financial year and an aggregate of 1 549 283
(2010: 493 919) SARs were allocated as at 31 March 2011; nil (2010: nil) MultiChoice Africa SARs
were allocated during the 2011 financial year and an aggregate of 238 059 (2010: 606 069)
MultiChoice Africa SARs were allocated as at 31 March 2011; nil (2010: nil) M-Net/SuperSport SARs
were allocated during the 2011 financial year and an aggregate of 44 538 (2010: 262 005) SARs were
allocated as at 31 March 2011; nil (2010: 33 333) MIH Brazil SARs were allocated during the 2011
financial year and an aggregate of 174 582 (2010: 179 248) SARs were allocated as at 31 March
2011; nil (2010: nil) Gadu-Gadu 2008 SARs were allocated during the 2011 financial year and an
aggregate of 31 910 (2010: 31 910) SARs were allocated as at 31 March 2011; 28 937
(2010: 68 900) Irdeto 2008 SARs were allocated during the 2011 financial year and an aggregate of
188 727 (2010: 159 790) SARs were allocated as at 31 March 2011; 203 169 (2010: 247 217)
MultiChoice 2008 SARs were allocated during the 2011 financial year and an aggregate of 519 696
(2010: 316 527) SARs were allocated as at 31 March 2011; nil (2010: 20 000) MIH Allegro 2008
SARs were allocated during the 2011 financial year and an aggregate of 129 449 (2010: 129 449)
SARs were allocated as at 31 March 2011; nil (2010: 2 842) MIH China 2008 SARs were allocated
during the 2011 financial year and an aggregate of 11 747 (2010: 11 747) SARs were allocated as at
31 March 2011; nil (2010: nil) MIH Ricardo 2008 SARs were allocated during the 2011 financial year
and an aggregate of 104 106 (2010: 104 106) SARs were allocated as at 31 March 2011; nil
(2010: 7 358) Allegro 2009 SARs were allocated during the 2011 financial year and an aggregate of
7 358 (2010: 7 358) SARs were allocated as at 31 March 2011; 241 546 (2010: nil) MIH Internet
Africa (Proprietary) Limited SARs were allocated during the 2011 financial year and an aggregate of
241 546 (2010: nil) MIH Internet Africa (Proprietary) Limited SARs were allocated as at 31 March
2011; 266 000 (2010: nil) Paarl Coldset (Proprietary) Limited SARs were allocated during the 2011
financial year and an aggregate of 266 000 (2010: nil) Paarl Coldset (Proprietary) Limited SARs were
allocated as at 31 March 2011; 300 000 (2010: nil) Paarl Media Holdings (Proprietary) Limited SARs
were allocated during the 2011 financial year and an aggregate of 300 000 (2010: nil) Paarl Media
Holdings (Proprietary) Limited SARs were allocated as at 31 March 2011.
These shares and SARs were granted on the same terms and conditions as those offered to
employees of the group.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
65
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
14. SHARE CAPITAL AND PREMIUM
Authorised
1 250 000 A ordinary shares of R20 each
500 000 000 N ordinary shares of 2 cents each
Issued
712 131 A ordinary shares of R20 each (2010: 712 131)
406 581 911 N ordinary shares of 2 cents each
(2010: 405 885 411)
Share premium
Less: Accumulated losses on vesting of equity compensation
Less: 31 142 354 (2010: 31 577 777) N ordinary shares held as
treasury shares at cost
31 March
2011
R’m
31 March
2010
R’m
25
10
35
14
8
22
19 271
19 293
(1 789)
(3 120)
14 384
25
10
35
14
8
22
19 018
19 040
(1 517)
(3 056)
14 467
Treasury shares
The group holds a total of 31 142 354 N ordinary shares (2010: 31 577 777), or 7,7% (2010: 7,8%)
of the gross number in issue at 31 March 2011 as treasury shares. Equity compensation plans hold
26 433 083 of the N ordinary shares (2010: 26 868 506) and the remaining 4 709 271 N ordinary
shares (2010: 4 709 271) are held by various group companies.
Voting and dividend rights
The A ordinary shareholders are entitled to 1 000 votes per share and may receive nominal dividends
as determined from time to time by the board of directors, but always limited to one-fifth of the
dividend to which N ordinary shareholders are entitled. The A ordinary shareholders do not have a
right to receive a dividend when dividends are declared to N ordinary shareholders, although a
dividend to A ordinary shareholders could be proposed by the board. In respect of all other rights, the
A ordinary shares rank pari passu with the N ordinary shares of the company.
Naspers Beleggings Beperk holds 350 000 (2010: 350 000) A ordinary shares and Keeromstraat 30
Beleggings Beperk holds 219 344 (2010: 219 344) A ordinary shares of the total 712 131 A ordinary
shares in issue at the year-end. As a result of the voting rights attached to these shares, the
companies have significant influence over the group. The majority of the directors on the boards of
these companies are also directors of Naspers Limited. Wheatfields 221 (Proprietary) Limited controls
133 350 (2010: 133 350) A ordinary shares.
Unissued share capital
The directors of the company have unrestricted authority until after the following annual general
meeting to allot and issue the unissued 537 869 A ordinary shares and 93 418 089 N ordinary shares
in the company. This authority was granted subject to the provisions of section 221 of the South
African Companies Act, No 61 of 1973, and the JSE Listings Requirements.
66
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
14. SHARE CAPITAL AND PREMIUM (continued)
Movement in N ordinary shares in issue during the year
Shares in issue at 1 April
Shares issued to share incentive trusts
Shares in issue at 31 March
Movement in N ordinary shares held as treasury shares
during the year
Shares held as treasury shares at 1 April
Shares issued to share incentive trusts
Shares acquired by participants from equity compensation plans
2011
Number of
N shares
2010
Number of
N shares
405 885 411
696 500
404 305 411
1 580 000
406 581 911
405 885 411
31 577 777
696 500
(1 131 923)
31 854 868
1 580 000
(1 857 091)
Shares held as treasury shares at 31 March
31 142 354
31 577 777
Net number of N ordinary shares in issue at 31 March
375 439 557
374 307 634
Share premium
Balance at 1 April
Share premium on share issues
Balance at 31 March
31 March
2011
R’m
31 March
2010
R’m
19 018
253
19 271
18 585
433
19 018
Refer to note 40 for share options in employee share incentive plans.
Capital management
The group’s objectives when managing capital are to safeguard the entity’s ability to continue as a
going concern, so that it can continue to provide adequate returns for shareholders and benefits for
other stakeholders by pricing products and services commensurately with the level of risk.
Naspers relies upon distributions from its subsidiaries, associated companies, joint ventures and other
investments to generate the funds necessary to meet the obligations and other cash flow
requirements of the combined group. The operations of Naspers have been funded in a number of
ways in the past. The internet and technology development activities were primarily funded by cash
generated by the pay-television businesses and some debt financing. Media24 used its statement of
financial position and cash-generating capacity to utilise debt to finance its property, plant and
equipment refurbishment and certain acquisitions.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
67
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
14. SHARE CAPITAL AND PREMIUM (continued)
Capital management (continued)
Naspers’s general business approach has been to acquire developing businesses and to provide
funding to meet the cash needs of the business until it can, within a reasonable period of time, become
self-funding. Funding is provided through a combination of loans and share capital, depending on the
country-specific regulatory requirements. From a subsidiary’s perspective, intergroup loan funding is
generally considered to be part of the capital structure. The focus on increased profitability and cash
flow generation will continue in the foreseeable future, although Naspers will continue to actively
evaluate potential growth opportunities within its areas of expertise. Naspers will also grow its business
in the future by making equity investments in growth companies. Naspers anticipates that it may fund
future acquisitions and investments through the issue of debt instruments and available cash
resources.
The group sets the amount of capital in proportion to risk. The group manages the capital structure
and makes adjustments to it in the light of changes in economic conditions and the risk
characteristics of the underlying assets. In order to maintain or adjust the capital structure, the group
may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new
shares or sell assets to reduce debt.
In July 2010 the group issued a seven-year US$700m international bond. The bond matures in July
2017 with a fixed interest rate of 6,375%. The proceeds were used to partly pay down the offshore
revolving credit facility (RCF).
During March 2011 the group refinanced its existing RCF of US$1,72bn with a new RCF of
US$1,875bn. The new RCF matures in March 2016 and bears interest at US LIBOR plus 1,75%
before commitment and utilisation fees. At the same time, the group entered into a bilateral facility for
US$125m under the same terms and conditions as the RCF providing the group with a total RCF of
US$2bn.
The borrower under the bond and RCF/bilateral facilities is MIH B.V. and the facilities are guaranteed
by Naspers Limited. The borrower is obligated to pay a commitment fee equal to 35% of the
applicable margin under the RCF/bilateral facility. The undrawn balance of the RCF is available to fund
future investments by the group as part of its growth strategy.
As of 31 March 2011 Naspers had total interest-bearing debt (including capitalised finance leases) of
R13,5bn (2010: R9,5bn) and total cash of R7,4bn (2010: R5,8bn). The net interest-bearing debt to
equity ratio was 15% (2010: 11%) at 31 March 2011. The group excludes satellite transponders from
total interest-bearing debt when evaluating and managing capital. These items are considered to
be operating expenses. The adjusted total interest-bearing debt (excluding transponder leases)
was R11,3bn (2010: R7,5bn) and the adjusted net interest-bearing debt to equity ratio was 10%
(2010: 5%).
The group does not have a formal targeted debt-equity ratio. The group, as well as the Media24 and
MIH groups, have specific financial covenants in place with various financial institutions to govern their
debt.
South African exchange control regulations are administered by the South African Reserve Bank
acting through its Financial Surveillance Department. The exchange control regulations provide for a
common monetary area consisting of the Republic of South Africa, the Kingdom of Lesotho, the
Kingdom of Swaziland and the Republic of Namibia, and restrict the export of capital from the
common monetary area. Approval is required for any acquisitions outside of the common monetary
area if the acquisition is funded from within the common monetary area.
68
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
15. OTHER RESERVES
Other reserves on the statement of financial position comprise:
Foreign currency translation reserve
Hedging reserve
Valuation reserve
Existing control business combination reserve
Share-based compensation reserve
31 March
2011
R’m
31 March
2010
R’m
(1 185)
(297)
4 256
25
2 300
5 099
(737)
(407)
1 844
97
1 573
2 370
The valuation reserve relates to the difference between the fair value and the book value of shares
given in business combinations, as well as the fair value adjustments made to intangible assets during
successive acquisitions are included in this reserve. This also relates to unrealised profits and losses
that resulted from changes in the fair value of investments that are classified available-for-sale. This
includes our share of associates’ revaluation of their own available-for-sale investments.
The hedging reserve relates to the changes in the fair value of derivative financial instruments. It
hedges forecast transactions or the foreign currency part of firm commitments. The changes in fair
value are recorded in the hedging reserve until the forecast transaction or firm commitment results in
the recognition of an asset or liability, when such deferred gains or losses are then included in the
initial measurement of the asset or liability.
The foreign currency translation reserve relates to exchange differences arising from the translation of
foreign subsidiaries’, joint ventures’ and associates’ income statements at average exchange rates for
the year and their statements of financial position at the ruling exchange rates at the statement of
financial position date if the functional currency differs.
The existing control business combination reserve is used to account for transactions with non-
controlling shareholders in terms of the economic entity model, whereby the excess of the cost of the
transactions over the acquirer’s interest in previously recognised assets and liabilities is allocated to
this reserve in equity. This reserve is also used in common control transactions (where all of the
combining entities in a business combination are ultimately controlled by the same entity) where the
excess of the cost over the acquirer’s proportionate share of the net assets is allocated to this
reserve.
The fair value of share options issued to employees is accounted for in the share-based
compensation reserve over the vesting period. The reserve is adjusted at each year-end when the
entity revises its estimates of the number of share options that are expected to become exercisable.
It recognises the impact of the revision of original estimates, if any, in the income statement, with a
corresponding adjustment to this reserve in equity for equity-settled plans.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
69
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
16. RETAINED EARNINGS
Any future dividends declared from the distributable reserves of the company or its subsidiaries, which
are not wholly owned subsidiaries of the company and are incorporated in the Republic of South
Africa, may be subject to secondary taxation on companies (STC) at a rate of 10% of the dividends
declared. Dividends received by group companies during their various dividend cycles can be carried
forward as unutilised STC credits. These STC credits can then be utilised to reduce any STC payable
on future dividends declared by group companies. The group’s total unutilised STC credits at
31 March 2011 amounted to R1,6bn (2010: R2,5bn). The group has raised a valuation allowance
against deferred tax assets of R45,7m relating to unutilised STC credits at 31 March 2011 (2010:
R156,6m) due to uncertainties relating to the utilisation of these credits. The valuation allowance was
based on the difference between the total unutilised STC credit available to the group, and the
estimated STC liability for the next annual dividend cycle.
The board of directors has proposed that a dividend of 270 cents (2010: 235 cents) per N ordinary
share and 54 cents (2010: 47 cents) per A ordinary share be paid to shareholders on 27 September
2011. If approved by the shareholders of the company at its annual general meeting, the company
will pay a total dividend of R1,1bn based on the number of shares in issue at 31 March 2011. The
company has enough STC credits carried forward to cover such a dividend. The utilisation of these
STC credits will however lead to the realisation of a deferred taxation asset of R110m that will be
charged to the income statement during the 2012 financial year.
17. POST-RETIREMENT LIABILITIES
17.1 Medical liability
The group operates a number of post-retirement medical benefit schemes. The obligation of the
group to pay medical aid contributions after retirement is no longer part of the conditions of
employment for new employees. A number of pensioners and current employees, however,
remain entitled to this benefit. The entitlement to this benefit for current employees is dependent
upon the employees remaining in service until retirement age and completing a minimum service
period. The group provides for post-retirement medical aid benefits on the accrual basis
determined each year by way of a valuation. The key assumptions and valuation method are
described below. The directors believe that adequate provision has been made for future
liabilities.
Media24 Limited and Via Afrika Limited entered into agreements during the year ended
31 March 2004 with certain employees to terminate their future participation in the post-
retirement medical aid benefits plan, in exchange for certain future contributions to endowment
policies for these employees. The endowment policy asset amounted to R54,8m at 31 March
2009 and has matured during the year ended 31 March 2010.
Key assumptions and valuation method
The actuarial valuation method used to value the liabilities is the projected unit credit method
prescribed by IAS 19. Future benefits valued are projected using specific actuarial assumptions
and the liability for in-service members is accrued over the expected working lifetime.
The most significant actuarial assumptions used for the current and previous valuations are
outlined below:
Discount rate
Healthcare cost inflation
Average retirement age
Membership discontinued at retirement
31 March
2011
31 March
2010
8,3%
7,3%
60
0%
10,2%
9,2%
60
0%
70
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
17. POST-RETIREMENT LIABILITIES (continued)
17.1 Medical liability (continued)
Key assumptions and valuation method (continued)
We assumed that current in-service members would retire on their current medical scheme
option and that there would be no change in options at retirement.
Actuarial assumptions are generally more suited to the estimation of the future experience of
larger groups of individuals. The overall experience of larger groups is less variable and is more
likely to tend to the expected value of the underlying statistical distribution. The smaller the
group size, the less likely it is that the actual future experience will be close to that expected.
Furthermore, note that even if the assumptions are appropriate for the group overall, they may
not be appropriate at an individual level.
Post-retirement medical liability
Opening balance
Current service cost
Interest cost
Employer benefit payments
Actuarial (gain)/loss
Less: Short-term portion
Closing balance
Trend information
Present value of obligations
Experience adjustments:
In respect of present value of
obligations – actuarial (gain)/loss
31 March
2011
R’m
31 March
2010
R’m
178
1
16
(9)
(6)
180
(1)
179
155
10
15
(7)
6
179
(1)
178
31 March
2011
R’m
2010
R’m
2009
R’m
2008
R’m
2007
R’m
180
179
156
142
150
(6)
6
6
4
6
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
71
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
17. POST-RETIREMENT LIABILITIES (continued)
17.1 Medical liability (continued)
As the value of the liability is based on a number of assumptions, a sensitivity analysis is
presented below to show the effect of a one-percentage point decrease or increase in the rate
of healthcare cost inflation:
Healthcare cost inflation
Assumption
7,3%
Accrued liability 31 March 2011 (R’m)
% change
Current service cost + interest cost 2011/12 (R’m)
% change
180
—
15
—
(1%)
176
(2,2%)
15
(0,1%)
+ 1%
184
+2,2%
16
+6,7%
17.2 Pension and provident benefits
The group provides retirement benefits for its full-time employees by way of various separate
defined contribution pension and provident funds. All full-time employees have access to these
funds. Contributions to these funds are paid on a fixed scale. The South African retirement
funds of the group are governed by the Pension Funds Act of South Africa. Substantially all the
group’s full-time employees are members of either one of the group’s retirement benefit plans or
a third-party plan.
An amount of R306,7m (2010: R279,4m) was recognised as an expense in relation to the
group’s retirement funds.
18. LONG-TERM LIABILITIES
Interest-bearing: Capitalised finance leases
Total liabilities
Less: Current portion
Interest-bearing: Loans and other liabilities
Total liabilities
Less: Current portion
Non-interest-bearing: Programme and film rights
Total liabilities
Less: Current portion
Non-interest-bearing: Loans and other liabilities
Total liabilities
Less: Current portion
31 March
2011
R’m
31 March
2010
R’m
1 893
2 147
(254)
10 822
11 314
(492)
—
748
(748)
123
139
(16)
1 736
2 065
(329)
6 877
7 471
(594)
—
736
(736)
137
153
(16)
Net long-term liabilities
12 838
8 750
72
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
18. LONG-TERM LIABILITIES (continued)
Interest-bearing: Capitalised finance leases
Currency
of
year-end
balance
Year of
final
repayment
Weighted
average
year-end
interest rate
31 March
2011
R’m
31 March
2010
R’m
Type of lease
Buildings, manufacturing
equipment, vehicles,
computers and office
equipment
Transmission equipment
and satellites
Various
Various
Various
USD
EUR
EUR
USD
USD
2011
2011
2011
2013
2025
8,2%
9,1%
3,5%
4,1%
6,0%
Total capitalised finance leases
Minimum instalments
Payable within year one
Payable within year two
Payable within year three
Payable within year four
Payable within year five
Payable after year five
Future finance costs on finance leases
Present value of finance lease liabilities
Present value
Payable within year one
Payable within year two
Payable within year three
Payable within year four
Payable within year five
Payable after year five
Present value of finance lease liabilities
33
33
136
—
—
98
1 880
2 114
2 147
378
231
218
216
216
1 819
3 078
(931)
2 147
254
121
115
121
128
1 408
2 147
45
45
336
27
34
118
1 505
2 020
2 065
451
396
222
156
154
1 502
2 881
(816)
2 065
329
298
140
80
84
1 134
2 065
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
73
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
18. LONG-TERM LIABILITIES (continued)
Interest-bearing: Loans and other liabilities
Currency
of
year-end
balance
Year of
final
repay-
ment
Weighted
average
year-end
interest
rate
Asset
secured
31 March
2011
R’m
31 March
2010
R’m
Guarantees
Guarantees
Various
USD
USD
Various
2016
2017
Various
3-month
LIBOR
+1,75%
(2,01%)
6,4%
Various
6 072
4 683
25
6 710
—
29
ZAR
ZAR
ZAR
ZAR
EUR
2012
7,4%
2011
10,3%
2012
14,7%
8
69
62
2012
14,7%
(30)
—
3,9%
ZAR
Various
Various
ZAR
Various
2012
Various
Various
Various
349
50
(32)
58
37
135
54
(26)
353
170
(28)
37
Loan
Secured
Syndicated loans
Publicly traded bond
Various institutions
Unsecured
Term loan:
Nedbank Limited
Term loan:
CommerzBank
Term loan:
Nedbank Limited
Preference share
investments
Loans from non-
controlling shareholders
Loans from non-
controlling shareholders
Right to subscription
shares
Other loans
11 314
7 471
74
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
18. LONG-TERM LIABILITIES (continued)
Non-interest-bearing: Programme and film rights
Currency
of
year-end
balance
Year of
final
repay-
ment
31 March
2011
R’m
31 March
2010
R’m
Liabilities
Unsecured
Programme and film rights liabilities
USD
2012
Non-interest-bearing: Loans and other liabilities
Loans
Unsecured
MTN Limited
Loans from non-controlling shareholders
Other
ZAR Conditional
Various
Various
Various
Various
Total long-term liabilities
Repayment terms of long-term liabilities (excluding capitalised
finance leases)
– Payable within year one
– Payable within year two
– Payable within year three
– Payable within year four
– Payable within year five
– Payable after year five
Interest rate profile of long-term liabilities (long- and short-term portion,
including capitalised finance leases)
– Loans at fixed rates: 1 – 12 months
– Loans at fixed rates: more than 12 months
– Interest-free loans
– Loans linked to variable rates
748
748
86
11
42
139
1 256
36
16
107
6 078
4 708
12 201
303
6 619
887
6 539
736
736
105
11
37
153
1 241
58
7 002
10
27
22
8 360
350
1 830
889
7 356
14 348
10 425
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
75
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
19. PROVISIONS
The following account balances have been determined based on management’s estimates and
assumptions:
1 April
2010
R’m
133
8
10
24
23
4
—
—
Group
Warranties
Pending litigation
Reorganisation
Onerous contracts
Ad valorem duties
Decommissioning
costs
Refurbishment
Long service and
retirement gratuity
Unuti-
lised
provi-
sions
reversed
to
income
R’m
Addi-
tional
provi-
sions
raised
R’m
Provi-
sions
utilised
R’m
Foreign
currency
trans-
lation
R’m
Other
R’m
31 March
2011
R’m
Less:
Short-
term
portion
R’m
Long-
term
portion
R’m
—
51
2
13
—
2
—
33
(37)
(1)
—
(2)
—
(1)
—
—
—
(1)
(11)
(11)
—
(1)
—
—
(5)
—
—
(1)
—
—
—
—
(6)
—
—
—
—
—
3
2
—
5
91
57
1
23
23
7
2
33
237
(90)
(54)
(1)
(18)
(23)
(3)
—
—
(189)
1
3
—
5
—
4
2
33
48
202
101
(41)
(24)
Unuti-
lised
provi-
sions
reversed
to
income
R’m
Addi-
tional
provi-
sions
raised
R’m
Provi-
sions
utilised
R’m
Foreign
currency
trans-
lation
R’m
Other
R’m
31 March
2010
R’m
Less:
Short-
term
portion
R’m
Long-
term
portion
R’m
1
3
18
17
—
1
—
40
—
(5)
—
(1)
—
(5)
—
—
—
(8)
(7)
—
—
—
(36)
(1)
—
(2)
—
(3)
—
(11)
(15)
(42)
—
—
—
—
—
—
(2)
(2)
133
(132)
8
10
24
23
4
—
(6)
(10)
(12)
(23)
(4)
—
202
(187)
1
2
—
12
—
—
—
15
Group
Warranties
Pending litigation
Reorganisation
Onerous contracts
Ad valorem duties
Decommissioning
costs
Other
1 April
2009
R’m
168
11
—
17
23
11
2
232
76
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
19. PROVISIONS (continued)
Further details describing the provisions at 31 March 2011 are included below:
The group recognises the estimated liability on all products still under warranty at the statement of
financial position date. Included in warranties are Irdeto’s 12-month warranty on all hardware provided
as well as warranties for possible taxes payable.
The group is currently involved in various litigation matters. The litigation provision has been made
based on legal counsel and management’s estimates of costs and possible claims relating to these
actions (refer to note 21).
The provision for onerous contracts relates to compensation for early termination of a contract with a
business partner, as well as obligations that the group has in terms of lease agreements, but the
premises have been vacated. The group is liable for the rent under these contracts. The obligation will
be settled over the remaining lease periods.
The provision for ad valorem duties relates to an investigation by tax authorities into the value ascribed
to digital satellite decoders purchased for onward sale to major retailers. The provision was raised for
the payment of these duties.
The provision for decommissioning relates to the estimated costs of decommissioning rented
buildings. The lease agreements require that we return the rented buildings in the original state.
The provision for long service and retirement gratuity relates to the estimated cost of these
employee benefits.
20. ACCRUED EXPENSES AND OTHER CURRENT
LIABILITIES
Deferred income
Accrued expenses
Amounts owing in respect of investments acquired
Taxes and other statutory liabilities
Bonus accrual
Accrual for leave
Other personnel accruals
Cash-settled share-based payment liability (short term)
Other current liabilities
31 March
2011
R’m
31 March
2010
R’m
1 555
2 219
35
1 189
442
238
102
15
388
6 183
1 485
1 982
32
851
282
210
89
24
271
5 226
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
77
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
21. COMMITMENTS AND CONTINGENCIES
The group is subject to commitments and contingencies, that occur in the normal course of business,
including legal proceedings and claims that cover a wide range of matters. The group plans to fund
these commitments and contingencies out of existing loan facilities and internally generated funds.
(a) Capital expenditure
Commitments in respect of contracts placed for capital expenditure at 31 March 2011
amounted to R401,1m (2010: R526,6m).
(b) Programme and film rights
At 31 March 2011 the group had entered into contracts for the purchase of programme and
film rights. The group’s commitments in respect of these contracts amounted to R7,7bn
(2010: R8,7bn).
(c)
Transponder leases
During the year ended 31 March 2011 the group entered into new leasing contracts for new and
an increased number of satellite transponders. The commitment outstanding as at 31 March
2011 amounted to R6,8bn (2010: R7,7bn).
(d) Set-top boxes
At 31 March 2011 the group had entered into contracts for the purchase of set-top boxes
(decoders). The group’s commitments in respect of these contracts amounted to R468,7m
(2010: R358,7m).
(e) Other commitments
At 31 March 2011 the group had entered into contracts for the receipt of various services.
These service contracts are for the receipt of advertising, satellite and DVB-H broadcast
capacity, computer and decoder support services, access to networks and contractual
relationships with customers, suppliers and employees. The group’s commitments in respect
of these agreements amounted to R700,3m (2010: R656,6m).
(f) Operating lease commitments
The group has the following operating lease liabilities at
31 March 2011 and 2010:
Minimum operating lease payments:
Payable in year one
Payable in year two
Payable in year three
Payable in year four
Payable in year five
Payable after five years
31 March
2011
R’m
31 March
2010
R’m
213
171
137
118
87
170
896
190
149
116
81
58
104
698
The group leases office, manufacturing and warehouse space under various non-cancellable
operating leases. Certain contracts contain renewal options and escalation clauses for various
periods of time.
78
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
21. COMMITMENTS AND CONTINGENCIES (continued)
(g)
Litigation claims
MultiChoice South Africa (MCSA)/South African Revenue Services (SARS)
MCSA instituted legal proceedings against SARS in relation to the ad valorem tariff
determination on decoders, which SARS made in 2004. The proceedings were defended by
SARS, but when the matter went to court the High Court found in MCSA’s favour. SARS
thereafter appealed to the Supreme Court of Appeal which, in February 2011, overturned the
decision of the High Court and found in SARS’s favour.
MIH Germany
MIH Germany B.V. and Myriad International Holdings B.V. ((cid:2130)MIH Germany”) were involved in an
arbitration in Germany. The dispute was governed by the arbitration rules of the German
institution for arbitration (DIS Rules) and was covered by an express confidentiality ruling by the
arbitration tribunal in question. An oral hearing took place from 12 to 14 October 2009. The
parties then exchanged written post-hearing submissions on 18 December 2009 and
statements of their respective fees and costs in January 2010. The arbitration tribunal issued its
award on 8 June 2010. In the award it dismissed the claimant’s claim and ordered it to pay a
substantial portion of MIH Germany’s legal costs and fees.
Eyeball Networks Inc. (“Eyeball”)/Gadu-Gadu S.A. (“Gadu-Gadu”)
On 19 May 2008 Gadu-Gadu was served with a claim for US$22,2m filed against it by Eyeball
in a court in British Columbia, Canada. The claim arose from a master software licence
agreement entered into on 23 March 2005 pursuant to which Gadu-Gadu acquired a licence to
use some of Eyeball’s products. The licence terminated no later than 9 November 2006 and
Eyeball alleges that Gadu-Gadu continued to use Eyeball’s products and that it is therefore
entitled to claim the full amount of the licence fees that would have been payable based on its
current standard pricing. Gadu-Gadu denies that it used Eyeball’s products after the date of
termination, and accordingly, that it owes any licence fees to Eyeball and is defending the claim.
Gadu-Gadu also filed a counterclaim against Eyeball and SalesManager Software Sp z o.o.,
Eyeball’s representative in Poland, for damages and loss arising from the wrongful breach and
repudiation of the transaction agreements and their failure to perform the obligations under the
transaction agreements. The pleadings have been filed and lists of documents have been
exchanged by Gadu-Gadu and Eyeball. Examinations for discovery have not yet been held. The
trial was originally set down for hearing on 15 November 2010, but at the request of Eyeball the
hearing was postponed to October 2011.
Taxation matters
The group operates a number of businesses in jurisdictions where withholding taxes are payable
on certain transactions or payments. In some circumstances transactions could possibly lead to
withholding taxes being payable. We continue to seek relevant advice and work with our
advisors to identify and quantify such tax exposures. Our current assessment of possible
withholding tax exposures, including interest and potential penalties amounts to approximately
R546,8m (US$80,8m) (2010: R229,6m (US$31,3m)).
Paarl Print fire
On 17 April 2009 a fire destroyed the premises of Paarl Print (Proprietary) Limited in Paarl and
claimed the lives of 13 people. A formal inquiry in terms of section 32 of the Occupational
Health and Safety Act No 85 of 1993 (OHSA), was completed in June 2010. A report has been
prepared in terms of section 32 of OHSA and based on information received from the
Department of Labour it is anticipated that this report will be made available in the foreseeable
future. Further information indicates that the report has been referred to the National Prosecuting
Authority for further action. Once the report has been made available, it is possible that third
parties may pursue civil claims against the company. Paarl Print’s exposure in this regard, after
insurance reimbursement, is not expected to be material.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
79
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
21. COMMITMENTS AND CONTINGENCIES (continued)
(g)
Litigation claims (continued)
Gold Reef City/M-Net
Akani Egoli (Proprietary) Limited instituted action in December 2005 against M-Net and
Combined Artistic Productions in the High Court of South Africa for damages of R10,6m
allegedly suffered by the plaintiff as a result of an alleged defamation in a television broadcast.
On 15 February 2006 the defendants filed their plea and pleadings were closed. The matter was
set down for a hearing in November 2007, but before the hearing the plaintiff requested
defendants to agree to a postponement sine die, which they agreed to. Thereafter a new claim
for more than R40m, arising from the same cause of action, was served on the defendants by
Gold Reef City Theme Park. At the same time, the first claim by Akani Egoli was reduced. The
claims were consolidated and amounted to approximately R47m. A hearing of the matter took
place in the High Court in August/September 2010. Judgement was delivered in February 2011
in favour of the claimants and the defendants are appealing to the SCA. The High Court
decision dealt only with liability, not with the quantum of damages.
(h) Guarantees
At 31 March 2011 the group had provided guarantees of R2,0bn (2010: R1,2bn) mainly in
respect of bank guarantees for sport rights, office rental, services and other contracts.
(i)
Assets pledged as security
The group pledged property, plant and equipment, investments, cash and cash equivalents and
accounts receivable with a net carrying value of R2,2bn at 31 March 2011 (2010: R4,6bn) to a
number of banks as security for certain bank overdrafts and term loans listed in note 18 to the
value of R2,2bn (2010: R2,1bn).
22. REVENUE
Subscription revenue
Advertising revenue
e-Commerce revenue
Technology revenue
Circulation revenue
Printing revenue
Hardware sales
Book publishing and book sales revenue
Distribution revenue
Sublicence revenue
Decoder maintenance
Contract publishing
Reconnection fees
Other revenue
31 March
2011
R’m
31 March
2010
R’m
17 206
4 495
3 294
1 594
1 308
1 210
1 155
747
409
302
222
180
113
850
33 085
14 762
3 814
2 854
1 209
1 235
1 098
864
645
234
213
177
163
84
646
27 998
Other revenue includes revenue from backhaul charges, financing service fees, online deed searches and
instant messaging.
Barter revenue
Amount of barter revenue included in total revenue
146
112
80
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
23. EXPENSES BY NATURE
Operating profit includes the following items:
Depreciation classification
Cost of providing services and sale of goods
Selling, general and administration expenses
Amortisation classification
Cost of providing services and sale of goods
Selling, general and administration expenses
Operating leases
Buildings
Satellites and transponders
Other equipment
Auditor’s remuneration
Audit fees
Audit fees – prior year underprovision
Audit-related fees
Tax fees
All other fees
Foreign exchange (losses)/profits
On capitalisation of forward exchange contracts in hedging
transactions
Other
31 March
2011
R’m
31 March
2010
R’m
618
424
1 042
99
1 072
1 171
214
9
36
259
63
2
2
22
4
93
(437)
—
(437)
545
333
878
123
1 090
1 213
204
57
30
291
58
4
2
25
10
99
(29)
6
(23)
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
81
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
23. EXPENSES BY NATURE (continued)
Staff costs
As at 31 March 2011 the group had 15 932 (2010: 12 958)
permanent employees. The total cost of employment of all
employees, including executive directors, was as follows:
Salaries, wages and bonuses
Retirement benefit costs
Medical aid fund contributions
Post-retirement benefits
Training costs
Share-based compensation expenses
Total staff costs
Fees paid to non-employees for administration,
management and technical services
Research and development costs
Advertising expenses
Amortisation of programme and film rights
Cost of inventories sold
24. OTHER GAINS/(LOSSES) – NET
Profit/(loss) on sale of assets
Fair value adjustment of financial instruments
Impairment losses
Impairment and derecognition of goodwill and other
intangible assets
Impairment of property, plant and equipment due to
fire damage
Impairment of other property, plant and equipment and
other assets
Welkom Yizani refinancing
Gain on settlement of transponder lease
Compensation received from third parties for property,
plant and equipment impaired, lost or stolen
Total other gains/(losses) – net
31 March
2011
R’m
31 March
2010
R’m
5 660
307
199
11
87
519
6 783
169
44
926
3 951
3 692
42
6
(1 068)
(1 040)
—
(28)
—
88
51
(881)
4 689
279
194
17
55
484
5 718
140
21
1 100
2 997
3 866
(47)
—
(939)
(384)
(144)
(81)
(330)
253
369
(364)
Refer to notes 4, 5 and 6 for further information on the above impairments.
82
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
25. FINANCE COSTS/(INCOME)
Interest paid
Loans and overdrafts
Transponder leases
RCF costs – accelerated amortisation
Other
Interest received
Loans and bank accounts
Other
Net loss/(profit) from foreign exchange translation and fair
value adjustments on derivative financial instruments
On translation of assets and liabilities
On translation of transponder leases
On translation of forward exchange contracts
Preference dividends (BEE structures) received
Other finance costs/(income) – net
Total finance costs/(income)
26. GAINS ON ACQUISITIONS AND DISPOSALS
Profit on sale of investments
Gain on loss of control
Acquisition related costs
Other
31 March
2011
R’m
31 March
2010
R’m
883
144
128
234
1 389
(308)
(93)
(401)
26
(13)
234
247
(217)
30
1 018
34
72
(109)
45
42
600
93
—
190
883
(314)
(34)
(348)
(141)
(82)
377
154
(268)
(114)
421
144
—
—
—
144
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
83
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
27. TAXATION
Normal taxation
South Africa
– Current year
– Prior year
Foreign taxation
– Current year
– Prior year
Secondary taxation on companies
Income taxation for the year
Deferred taxation
South Africa
– Current year
– Prior year
Foreign taxation
– Current year
– Change in rate
– Prior year
Total taxation per income statement
Reconciliation of taxation
Taxation at statutory rates
Adjusted for:
Non-deductible expenses
Non-taxable income
Temporary differences not provided for
Assessed losses expired
Initial recognition of prior year taxes
Other taxes
Changes in taxation rates
Tax attributable to associate income
Tax adjustment for foreign taxation rates
31 March
2011
R’m
31 March
2010
R’m
1 488
1 490
(2)
585
609
(24)
5
1 351
1 395
(44)
530
555
(25)
5
2 078
1 886
(100)
(129)
29
(117)
(139)
—
22
1 861
2 186
446
(68)
181
(11)
(17)
164
24
(920)
(124)
6
(22)
28
(84)
(62)
(22)
—
1 808
1 613
404
(195)
676
—
(36)
364
(23)
(576)
(419)
Taxation provided in income statement
1 861
1 808
28. NON-CURRENT ASSETS AND LIABILITIES HELD-FOR-SALE
As at 31 March 2011 held-for-sale assets to the value of R37m (2010: R12m) comprise mainly land
and buildings in South Africa which are being actively marketed for sale.
84
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
29. EARNINGS PER SHARE
31 March
2011
2010
Gross
R’m
Taxation
R’m
Non-con-
trolling
interests
R’m
Net
R’m
Gross
R’m
Taxation
R’m
Non-con-
trolling
interests
R’m
5 260
(1 016)
(51)
(27)
7
(4)
(1 047)
14
(30)
(17)
(369)
7
47
50
90
Net
R’m
3 257
40
(232)
20
—
—
20
225
(40)
(34)
151
1 040
(39)
(30)
971
384
—
(11)
373
(404)
(3)
(152)
(1 461)
(28)
23
4
1
—
—
—
—
6
1
5
—
—
—
(394)
(156)
(1)
(73)
(147)
(1 461)
(120)
—
30
62
(28)
23
4 213
(6)
1
—
—
5
—
6
—
—
—
—
(1)
(156)
(72)
(120)
—
35
61
3 297
Earnings
Net profit attributable
to shareholders
Headline adjustments
Adjustments for:
Insurance proceeds
Impairment of
property, plant and
equipment and other
assets
Impairment and
derecognition of
goodwill and intangible
assets
Profit on sale of
property, plant and
equipment
Profit on sale of
intangibles
Profit on sale of
investments
Dilution profit
Remeasurement
included in
equity-accounted
earnings
Impairment of
equity-accounted
investments
Headline earnings
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
85
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
29. EARNINGS PER SHARE (continued)
Number of N ordinary shares in issue at year-end (excluding
treasury shares)
Adjusted for movement in shares held by share trusts
2011
Number of
N shares
2010
Number of
N shares
375 439 557
(938 564)
374 307 634
(1 356 802)
Weighted average number of N ordinary shares in issue during
the year
Adjusted for effect of future share-based compensation
payments
374 500 993
372 950 832
14 964 275
10 869 345
Diluted weighted average number of N ordinary shares in issue
during the year
389 465 268
383 820 177
Earnings per N ordinary share (cents)
Basic
Fully diluted
Headline earnings per N ordinary share (cents)
Basic
Fully diluted
Dividend paid per A ordinary share (cents)
Dividend paid per N ordinary share (cents)
Proposed dividend per A ordinary share (cents)
Proposed dividend per N ordinary share (cents)
1 405
1 351
1 125
1 082
47
235
54
270
873
848
884
859
41
207
47
235
86
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
30. CASH FROM OPERATIONS
Profit before tax per income statement
Adjustments:
– Non-cash and other
(Profit)/loss on sale of assets
Depreciation and amortisation
Share-based compensation expenses
Net finance cost/(income)
Share of equity-accounted results
Impairment of equity-accounted investments
Gains on acquisitions and disposals
Dilution gains on equity-accounted investments
Gain on settlement of transponder lease
Insurance proceeds not yet received
Insurance proceeds received elsewhere included
Impairment losses
Other
– Working capital
Cash movement in trade and other receivables
Cash movement in payables, provisions and accruals
Cash movements for programme and film rights
Cash movement in inventories
31 March
2011
R’m
31 March
2010
R’m
7 808
(69)
(42)
2 213
519
1 018
(3 290)
23
(151)
(1 461)
(88)
—
(51)
1 068
173
(463)
(797)
622
(236)
(52)
5 760
1 242
47
2 091
484
421
(2 058)
62
(144)
—
(253)
(142)
(286)
939
81
264
(130)
584
(180)
(10)
Cash from operations
7 276
7 266
31. ACQUISITION OF SUBSIDIARIES
Fair value of assets and liabilities acquired:
Property, plant and equipment
Investments and loans
Intangible assets
Net current assets/(liabilities)
Deferred taxation
Long-term liabilities
Non-controlling interests
Derecognition of investment in associate
Goodwill
Purchase consideration
Amount to be settled in future
Settlement of amounts owing in respect of prior year purchases
Cash in subsidiaries acquired
Net cash outflow from acquisition of subsidiaries
43
19
589
429
(173)
(10)
897
(219)
(98)
1 802
2 382
(12)
16
(442)
1 944
24
7
912
(14)
(278)
(36)
615
(122)
(2)
2 766
3 257
(155)
—
(57)
3 045
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
87
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
32. DISPOSAL OF SUBSIDIARIES
Book value of assets and liabilities:
Other intangible assets
Non-current assets classified as held-for-sale
Foreign currency translation
Profit on sale
Selling price
Cash in subsidiaries disposed of
Net cash inflow from disposal of subsidiaries
33. DILUTION OF SUBSIDIARIES
Book value of assets and liabilities:
Property, plant and equipment
Investments and loans
Net current assets/(liabilities)
Long-term liabilities
Dilution profit
Foreign currency translation reserve release
Dilution of cash
Net cash inflow from dilution of subsidiaries
34. ACQUISITION OF JOINT VENTURES
Fair value of assets and liabilities acquired:
Investments
Intangible assets
Net current assets/(liabilities)
Deferred taxation
Goodwill
Amount to be settled in future
Cash in joint venture acquired
Net cash outflow from acquisition of joint ventures
35. ACQUISITION OF ASSOCIATES
31 March
2011
R’m
31 March
2010
R’m
—
—
—
—
—
—
—
—
3
159
10
(163)
9
36
28
(8)
65
3
7
—
(1)
9
16
(8)
(1)
16
1
380
1
382
100
482
(79)
403
—
—
—
—
—
—
—
—
—
—
—
7
—
7
24
—
—
31
Included in acquisition of associates of R3 065m are the following: Dubizzle R76m, Park One R114m,
Iceni R33m, Titulum R5m, Mail.ru Group R2 834m and other acquisitions of R3m. These investments
were allocated to investments in associates.
88
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
36. CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short-term bank deposits
Bank overdrafts and call loans
31 March
2011
R’m
31 March
2010
R’m
4 399
4 332
(1 330)
7 401
3 394
3 391
(958)
5 827
Restricted cash
Restricted cash is still included in cash and cash equivalents due to the fact that it mostly relates to
cash held on behalf of customers. The following cash balances are restricted from immediate use
according to agreements with banks and other financial institutions:
Europe
Other
Total restricted cash
37. SEGMENT INFORMATION
190
2
192
102
25
127
IFRS 8 requires operating segments to be identified on the basis of internal reports about
components of the group that are regularly reviewed by the chief operating decisionmaker (CODM)
in order to allocate resources to the segments and to assess their performance. The chief operating
decisionmaker has been identified as the executive committee that makes strategic decisions.
The group proportionally consolidates its share of the results of its associated companies in the
various reportable segments. This is considered to be more reflective of the economic value of these
investments.
The group has identified its operating segments based on its business by service or product and
aggregated them into the following reporting segments: pay television, internet (with Tencent being
disclosed separately from the other internet operations), technology and print. Below are the types of
services and products from which each segment generates revenue:
(cid:96) Pay television – the group offers digital satellite and other pay television services to subscribers
through MultiChoice South Africa and MultiChoice Africa in the rest of sub-Saharan Africa.
(cid:96) Internet – the group operates internet platforms to provide various services and products. These
platforms are built around communities, and each of them provides various services, including
e-commerce, games, MVAS and IVAS (mobile and internet value-added services), content,
communication and social networking. These services are provided via mobile or PC/laptops. The
main platforms are Tencent, Allegro, Ricardo, Mail.ru Group, BuscaPé, Sanook!, ibibo, Movile,
Gadu-Gadu, Nimbuzz, MXit, OLX and Level Up!.
(cid:96) Technology – through Irdeto, the group provides digital content management and protection
systems to customers globally to protect, manage and monetise all digital media on any platform.
(cid:96) Print – through Media24 in Africa, the group publishes newspapers, magazines and books. Its
activities also include printing and distribution. The group also has print interests in Brazil through its
30% stake in the magazine publisher, Abril S.A., and in China through its stake in the listed Beijing
Media Company and Xin’an Media Company.
MWEB is now reported in the pay-television rather than the internet segment. It is working on
technologies to deliver video content. Comparative segmental results have been restated in
accordance with IFRS 8 (cid:2130)Operating Segments”.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
89
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
37. SEGMENT INFORMATION (continued)
March 2011
Revenue
External
Intersegmental
Total revenue
Cost of providing services and sale of goods
Selling, general and administration expenses
EBITDA
Depreciation
Amortisation – software
Interest on capitalised transponder leases
Trading profit
Interest received
Interest paid
Investment income
Share of equity-accounted results1
Profit before taxation
Taxation
Profit after taxation
Non-controlling interests
Profit from operations
Amortisation of other intangibles
Foreign exchange (losses)/gains
Impairment of investment in associates
Exceptional items
Net profit/(loss)
Additional disclosure
Impairment of assets
Impairment of goodwill
Share of equity-accounted results2
Notes
1 Includes immaterial associates not proportionally consolidated.
2 All associates’ results are accounted for using the equity method.
Internet
Pay
television
R’m
Tencent
R’m
Other
internet
R’m
21 025
131
21 156
(11 751)
(2 863)
6 542
(639)
(32)
(144)
5 727
926
(678)
193
—
6 168
(1 708)
4 460
(765)
3 695
(308)
(203)
—
76
3 260
(6)
—
—
7 215
—
7 215
(2 143)
(1 277)
3 795
(245)
(7)
—
3 543
94
(13)
—
28
3 652
(660)
2 992
(23)
2 969
(35)
12
—
31
2 977
—
—
3 123
4 877
36
4 913
(1 233)
(3 530)
150
(149)
(51)
—
(50)
327
(1 220)
—
4
(939)
(1)
(940)
114
(826)
(750)
4
(144)
781
(935)
(205)
(636)
(51)
90
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
Technology
R’m
Print
R’m
Total
reportable
segments
R’m
Corporate
R’m
Less:
Propor-
tionally
consolidated
associates
R’m
Eliminations
R’m
Total
R’m
1 228
541
1 769
(452)
(1 129)
188
(51)
(9)
—
128
81
(106)
—
—
103
(27)
76
—
76
(111)
(12)
—
(55)
(102)
(53)
—
—
10 758
227
10 985
(6 558)
(3 233)
1 194
(275)
(47)
—
872
168
(452)
—
3
591
(222)
369
(41)
328
(265)
(40)
97
99
219
(136)
(32)
218
45 103
935
46 038
(22 137)
(12 032)
11 869
(1 359)
(146)
(144)
10 220
1 596
(2 469)
193
35
9 575
(2 618)
6 957
(715)
6 242
(1 469)
(239)
(47)
932
5 419
(400)
(668)
3 290
—
77
77
(47)
(269)
(239)
(1)
—
—
(240)
78
(2)
24
—
(140)
(13)
(153)
—
(153)
—
(2)
—
(4)
(159)
—
—
—
(12 018)
—
(12 018)
4 425
3 112
(4 481)
320
19
—
(4 142)
(204)
157
—
3 432
(757)
770
13
28
41
246
(6)
24
(305)
—
—
—
—
—
(1 012)
(1 012)
683
329
—
—
—
—
—
(1 069)
1 069
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
33 085
—
33 085
(17 076)
(8 860)
7 149
(1 040)
(127)
(144)
5 838
401
(1 245)
217
3 467
8 678
(1 861)
6 817
(687)
6 130
(1 223)
(247)
(23)
623
5 260
(400)
(668)
3 290
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
91
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
37. SEGMENT INFORMATION (continued)
March 2010
Revenue
External
Intersegmental
Total revenue
Cost of providing services and sale of goods
Selling, general and administration expenses
EBITDA
Depreciation
Amortisation – software
Interest on capitalised transponder leases
Trading profit
Interest received
Interest paid
Investment income
Share of equity-accounted results1
Profit before taxation
Taxation
Profit after taxation
Non-controlling interests
Profit from operations
Amortisation of other intangibles
Foreign exchange (losses)/gains
Impairment of investment in associates
Exceptional items
Net profit/(loss)
Additional disclosure
Impairment of assets
Impairment of goodwill
Share of equity-accounted results2
Notes
1 Includes immaterial associates not proportionally consolidated.
2 All associates’ results are accounted for using the equity method.
Internet
Pay
television
R’m
Tencent
R’m
Other
internet
R’m
17 603
74
17 677
(9 264)
(2 562)
5 851
(506)
(22)
(91)
5 232
816
(405)
221
(1)
5 863
(1 421)
4 442
(698)
3 744
(432)
(52)
—
145
3 405
(52)
—
(1)
4 874
—
4 874
(1 428)
(904)
2 542
(159)
(20)
—
2 363
53
—
—
9
2 425
(319)
2 106
(26)
2 080
(32)
(1)
—
(86)
1 961
—
—
1 961
3 363
28
3 391
(733)
(2 503)
155
(131)
(25)
—
(1)
327
(918)
—
(4)
(596)
(126)
(722)
36
(686)
(634)
91
—
(103)
(1 332)
—
(335)
90
92
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
Technology
R’m
1 207
425
1 632
(448)
(1 086)
98
(44)
(7)
—
47
103
(100)
—
—
50
(55)
(5)
—
(5)
(117)
21
—
(1)
(102)
—
—
—
Print
R’m
10 204
186
10 390
(5 876)
(3 282)
1 232
(251)
(83)
(2)
896
28
(463)
—
—
461
(349)
112
(33)
79
(232)
(168)
(62)
100
(283)
(205)
(47)
8
Total
reportable
segments
R’m
Corporate
R’m
Less:
Propor-
tionally
consolidated
associates
R’m
Eliminations
R’m
Total
R’m
37 251
713
37 964
(17 749)
(10 337)
9 878
(1 091)
(157)
(93)
8 537
1 327
(1 886)
221
4
8 203
(2 270)
5 933
(721)
5 212
(1 447)
(109)
(62)
55
3 649
(257)
(382)
2 058
—
159
159
(126)
(263)
(230)
(2)
—
—
(232)
151
—
47
—
(34)
(59)
(93)
(32)
(125)
—
(9)
—
(76)
(210)
(330)
—
—
(9 253)
—
(9 253)
3 511
2 590
(3 152)
215
79
—
(2 858)
(64)
27
—
2 476
(419)
485
66
25
91
132
(36)
—
(187)
—
—
—
—
—
(872)
(872)
596
276
—
—
—
—
—
(1 066)
1 069
—
—
3
36
39
33
72
—
—
—
(254)
(182)
—
—
—
27 998
—
27 998
(13 768)
(7 734)
6 496
(878)
(78)
(93)
5 447
348
(790)
268
2 480
7 753
(1 808)
5 945
(695)
5 250
(1 315)
(154)
(62)
(462)
3 257
(587)
(382)
2 058
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
93
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
37. SEGMENT INFORMATION (continued)
The trading profit as disclosed in the segment disclosure above is the CODM and management’s
measure of each segment’s operational performance. A reconciliation of the segmental trading profit
to operating profit and profit before tax as reported in the income statement is provided below:
Trading profit per segment report
Adjusted for:
Interest on capitalised transponder leases
Amortisation of other intangible assets
Other gains/(losses)
Operating profit per the income statement
Interest received
Interest paid
Other finance income/(costs) – net
Share of equity-accounted results
Impairment of investment in associates
Gains on acquisitions and disposals
Dilution gains on equity-accounted investments
Profit before taxation as per the income statement
31 March
2011
R’m
5 838
144
(1 045)
(881)
4 056
401
(1 389)
(30)
3 290
(23)
42
1 461
7 808
31 March
2010
R’m
5 447
93
(1 135)
(364)
4 041
348
(883)
114
2 058
(62)
144
—
5 760
Sales between segments are eliminated in the (cid:2130)Eliminations” column. The revenue from external
parties and all other items of income, expenses, profits and losses reported in the segment report is
measured in a manner consistent with that in the income statement.
The revenues from external customers for each major group of products and services are disclosed in
note 22. The group is not reliant on any one major customer as the group’s products are consumed
by the general public in a large number of countries.
Geographical information
The group operates in five main geographical areas:
Africa – The group derives revenues from television platform services, print media activities, internet
services and technology products and services. The group is domiciled in the Republic of South
Africa and is therefore presented separately.
Asia – The group’s activities comprise its interest in internet and print activities based in China, India,
Thailand and Singapore.
Europe – The group’s activities comprise its interest in internet activities based in Central and Eastern
Europe and Russia. Furthermore, the group generates revenue from technology products and
services provided by subsidiaries based in the Netherlands.
Latin America – The group’s activities comprise its interest in internet and print activities based in
Brazil and other Latin American countries.
Other – Includes the group’s provision of various products through internet and technology activities
located mainly in Australia and the United States of America.
94
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
37. SEGMENT INFORMATION (continued)
Africa
South
Africa
R’m
Rest of
Africa
R’m
Latin
America
R’m
Asia
R’m
Europe
R’m
Other
R’m
Total
R’m
23 023
5 220
989
620
2 923
310
33 085
23 023
9 345
5 220
2 659
4 771
6 844
8 199
8 355
3 580
21 144
310
1 145
45 103
49 492
19 638
4 516
392
215
2 606
631
27 998
19 638
9 511
4 516
1 979
4 169
6 729
5 412
5 257
2 885
15 580
631
972
37 251
40 028
March 2011
Consolidated revenue
Proportionately
consolidated revenue1
Segment assets2
March 2010
Consolidated revenue
Proportionately
consolidated revenue1
Segment assets2
Notes
1 Revenue includes the group’s proportionate share of associates’ external revenue.
2 Segment assets consist of non-current assets excluding financial instruments, deferred tax and the proportionate
share of associates’ assets.
Included in the segment assets above is R6,6bn attributable to Brazil, R7,9bn attributable to China,
R6,8bn attributable to Poland and R9,4bn attributable to Russia. These are the only significant foreign
countries contributing more than 10% of the group’s segment assets for the year ended 31 March
2011 and relate mainly to the investments in associates.
Revenue is allocated to a country based on the location of subscribers or users.
38. FINANCIAL RISK MANAGEMENT
Financial risk factors
The group’s activities expose it to a variety of financial risks such as market risk (including currency
risk, fair value interest risk, cash flow interest risk and price risk), credit risk and liquidity risk. These
include the effects of changes in debt and equity markets, foreign currency exchange rates and
interest rates. The group’s overall risk management programme seeks to minimise the potential
adverse effects on the financial performance of the group. The group uses derivative financial
instruments, such as forward exchange contracts and interest rate swaps, to hedge certain risk
exposures. The group does not speculate with or engage in the trading of financial instruments.
The group had no significant price risk for the years ending 31 March 2011 and 31 March 2010.
Risk management is carried out by the management of the group under policies approved by the
board of directors and its risk management committee. Management identifies, evaluates and hedges
financial risks. The various boards of directors within the group provide written policies covering
specific areas, such as foreign exchange risk, interest rate risk, credit risk, the use of derivative
instruments and the investment of excess liquidity.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
95
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Foreign exchange risk
The group operates internationally and is exposed to foreign exchange risk. Although a substantial
portion of the group’s revenue is denominated in the currencies of the countries in which it operates,
a significant portion of cash obligations, including satellite transponder leases and contracts for
pay-television programming, are denominated in US dollars. Where the group’s revenue is
denominated in local currency depreciation of the local currency against the US dollar adversely
affects the group’s earnings and its ability to meet cash obligations. Some entities in the group use
forward exchange contracts to hedge their exposure to foreign currency risk in connection with their
obligations. Management may hedge the net position in the major foreign currencies by using forward
currency contracts. The group generally covers forward 50% to 100% of firm commitments in foreign
currency for up to two years in the pay-television business. The group also uses forward exchange
contracts to hedge foreign currency exposure in its print business where cover is generally taken for
75% to 100% of firm commitments in foreign currency for up to one year.
The group has classified its forward exchange contracts relating to forecast transactions and firm
commitments as cash flow and fair value hedges, and measures them at fair value. The transactions
relate mainly to programming costs, transponder lease instalments and the acquisition of inventory
items. A cumulative after-tax loss of R297,4m (2010: R407,7m after-tax loss) has been deferred in a
hedging reserve at 31 March 2011. This amount is expected to realise over the next two years. The
fair value of all forward exchange contracts designated as cash flow hedges at 31 March 2011 was a
net liability of R462,9m (2010: net liability of R527,9m), comprising assets of R9,0m (2010: Rnil) and
liabilities of R471,9m (2010: R527,9m), that were recognised as derivative financial instruments. The
fair value of all forward exchange contracts designated as fair value hedges at 31 March 2011 was a
liability of R133,9m (2010: liability of R195,4m).
During the year ended 31 March 2011 the group recognised gains on fair value hedges of R23,7m
(2010: R187,4m) and losses of R62,7m (2010: R209,8m) on the hedged items attributable to the
hedged risks. The amount recognised in the income statement due to the ineffectiveness of cash flow
hedges was R41,2m (2010: R123,0m). As at 31 March 2011 the group had no hedges of net
investments in foreign operations.
96
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Foreign exchange risk (continued)
The table below sets out the periods when the cash flows are expected to occur for both fair value
and cash flow hedges in place at 31 March 2011:
Total outstanding FECs at
31 March 2011
Pay television
Corporate
Print
Rand value (R’m)
Average exchange rate
Total outstanding FECs at
31 March 2010
Pay television
Corporate
Print
Rand value (R’m)
Average exchange rate
Maturing within
one year
USD
’m
EUR
’m
4
—
47
51
509
9,98
288
88
(2)
374
3 072
8,21
Maturing within
one year
USD
’m
EUR
’m
5
—
62
67
763
11,39
242
26
3
271
2 633
9,72
Maturing within one to
two years
Other
’m
EUR
’m
USD
’m
240
44
—
284
2 260
7,96
—
—
—
—
—
—
Maturing within one to
two years
EUR
’m
4
—
—
4
51
12,75
USD
’m
222
—
—
222
1 874
8,44
—
—
7
7
60
8,57
Other
’m
—
—
3
3
32
10,67
Where the group has surplus funds offshore, the treasury policy is to spread the funds between more
than one currency to limit the effect of foreign exchange rate fluctuations and to achieve the highest
level of interest income. As at 31 March 2011 the group had a net cash balance of R7,4bn
(2010: R5,8bn), of which R3,2bn (2010: R3,2bn) was held in South Africa. The R4,2bn
(2010: R2,6bn) held offshore was largely denominated in US dollar, euro and Polish zloty.
Foreign currency sensitivity analysis
The group’s presentation currency is the South African rand, but as it operates internationally, it is
exposed to a number of currencies, of which the exposure to the US dollar, euro and Polish zloty is
the most significant. The group is also exposed to the Chinese yuan renminbi and Brazil real but to a
lesser extent.
The sensitivity analysis below details the group’s sensitivity to a 10% decrease (2010: 10% decrease)
in the rand against the US dollar, euro and Polish zloty, as well as a 10% decrease (2010: 10%
decrease) of the US dollar against the euro, as well as a 10% decrease (2010: 10% decrease) of the
euro against the Polish zloty. This analysis includes only outstanding foreign currency denominated
monetary items and adjusts their translation at the period-end for the above percentage change in
foreign currency rates. The sensitivity analysis includes external loans, as well as loans to foreign
operations within the group, but excludes loans considered part of the net foreign investment and
translation differences due to translating from functional currency to presentation currency.
A 10% decrease (2010: 10% decrease) of the rand against the US dollar, euro and Polish zloty, a
10% decrease (2010: 10% decrease) of the US dollar against the euro, and a 10% decrease
(2010: 10% decrease) of the euro against the Polish zloty, would result in an after-tax gain of R160,3m
(2010: R103,9m after-tax gain). Other equity would increase by R329,5m (2010: R213,0m increase).
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
97
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Foreign exchange risk (continued)
Foreign exchange rates
The exchange rates used by the group to translate foreign entities’ income statements and
statements of financial position are as follows:
Currency (1FC = ZAR)
US dollar
Euro
Thai baht
Chinese yuan renminbi
Brazilian real
British pound
Polish zloty
Russian rouble
31 March 2011
31 March 2010
Average
rate
7,1557
9,4847
0,2302
1,0680
4,1704
11,1474
2,3732
0,2368
Closing
rate
6,7699
9,6041
0,2238
1,0345
4,1625
10,8687
2,3821
0,2383
Average
rate
7,7123
10,9054
0,2292
1,1295
4,1460
12,3308
2,6061
0,2523
Closing
rate
7,3343
9,9165
0,2265
1,0743
4,1111
11,1308
2,5702
0,2492
The average rates listed above are only approximate average rates for the year. The group measures
separately the transactions of each of its material operations, using the particular currency of the
primary economic environment in which the operation conducts its business, translated at the
prevailing exchange rate on the transaction date.
Derivative financial instruments
Current portion
Foreign exchange contracts
Other derivatives – put options1
Other derivatives – interest rate swaps
Non-current portion
Foreign exchange contracts
Other derivatives – put options1
Other derivatives – interest rate swaps
Total
31 March 2011
Assets
R’m
Liabilities
R’m
31 March 2010
Assets
R’m
Liabilities
R’m
12
—
—
12
3
3
—
6
18
461
123
15
599
151
563
—
714
1 313
—
—
—
—
—
—
—
—
—
625
71
151
847
98
579
7
684
1 531
Note
1 Media24 group entered into a contract with the Retief family trust in October 2008 which contains a put option
whereby the Retief family trust can enforce a buy-out by Media24 group of its remaining interest in Paarl Media
Holdings (Proprietary) Limited (currently 5%) and Paarl Coldset (Proprietary) Limited (currently 12,6%). Mr L P Retief,
a director of Naspers Limited (refer to note 13), is a related party to the Retief family trust. The group has several
other put options where non-controlling shareholders can put their stakes to the group based on specified terms and
conditions. The total value of these other options was R330m at 31 March 2011.
98
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Foreign exchange risk (continued)
31 March 2011
31 March 2010
Foreign
currency
amount
’m
1 075
6
57
29
233
26
Foreign
currency
amount
’m
1 050
4
46
—
256
49
R’m
7 280
63
548
68
1
40
R’m
7 703
45
460
1
2
25
Uncovered foreign liabilities
The group had the following uncovered
foreign liabilities:
US dollar
British pound
Euro
Polish zloty
South Korean won
Other
Credit risk
The group is exposed to certain concentrations of credit risk relating to the following assets:
Investments and loans
There is no concentration of credit risk within investments and loans, except for preference shares in
Welkom Yizani and Phuthuma Nathi. Shareholder agreements are in place, which regulate the shares
held by Welkom Yizani and Phuthuma Nathi, and management monitors the credit risk regularly.
Trade receivables
Receivables consist primarily of invoiced amounts from normal trading activities. The group has a
large diversified customer base across many geographical areas. The majority of trade receivables
consist of receivables within the pay-television, newspapers, magazines and printing segments.
Various credit checks are performed on new debtors to determine the quality of their credit history.
These checks are also performed on existing debtors with long-overdue accounts. Furthermore,
current debtors are monitored to ensure they do not exceed their credit limits. As at 31 March 2011
the directors were unaware of any significant unprovided or uninsured concentration of credit risk.
Other receivables
There is no concentration of credit risk within other receivables, except for the accrued preference
share dividends relating to the preference share investments, as disclosed above, and the promissory
notes. The level of interest in related party receivables minimises the credit risk.
Cash, deposits and derivative assets
The group is exposed to certain concentrations of credit risk relating to its cash, current investments
and derivative assets. It places these instruments mainly with major banking groups and high-quality
institutions that have high credit ratings. The group’s treasury policy is designed to limit exposure to
any one institution and invests its excess cash in low-risk investment accounts. As at 31 March 2011
the group held the majority of its cash, deposits and derivative assets with local and international
banks with a ‘Baa1’ credit rating or higher (Moody’s International rating). The counterparties that are
used by the group are evaluated on a continuous basis.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
99
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Credit risk (continued)
Cash, deposits and derivative assets (continued)
The maximum amount of credit risk that the group is exposed to is R15,9bn (2010: R13,4bn), and
has been calculated as follows:
Investments and loans
Receivables and loans
Derivative financial instruments
Cash and cash equivalents
31 March
2011
R’m
3 436
3 702
18
8 731
31 March
2010
R’m
3 503
3 106
—
6 785
15 887
13 394
Liquidity risk
Prudent liquidity risk management implies, among others, maintaining sufficient cash and marketable
securities, the availability of funding through an adequate amount of committed credit facilities and the
ability to close out market positions. In terms of the articles of association of the company, no
limitation is placed on its borrowing capacity. The facilities expiring within one year are subject to
renewal at various dates during the next year. The group had the following unutilised banking facilities
as at 31 March 2011 and 31 March 2010:
On call
Expiring within one year
Expiring beyond one year
31 March
2011
R’m
901
457
7 322
8 680
31 March
2010
R’m
1 477
249
5 868
7 594
100
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Liquidity risk (continued)
The following analysis details the group’s remaining contractual maturity for its non-derivative and
derivative financial liabilities. The analysis is based on the undiscounted cash flows of financial
liabilities based on the earliest date on which the group can be required to pay. The analysis includes
both interest and principal cash flows.
31 March 2011
Non-derivative financial liabilities
– Interest-bearing:
Carrying
value
R’m
Contractual
cash flows
R’m
0 – 12
months
R’m
1 – 5
years
R’m
5 years +
R’m
Capitalised finance leases
(2 147)
(3 078)
(378)
(881)
(1 819)
– Interest-bearing:
Loans and other
– Non-interest-bearing:
Programme and film rights
– Non-interest-bearing:
Loans and other
– Trade payables
– Accrued expenses and other current
liabilities
– Related party payables
– Bank overdrafts and call loans
(11 314)
(14 372)
(949)
(8 222)
(5 201)
(748)
(770)
(770)
—
(139)
(1 916)
(2 402)
(93)
(1 330)
(139)
(1 916)
(2 402)
(93)
(1 330)
(16)
(1 916)
(2 402)
(93)
(1 330)
(105)
—
—
—
—
—
(18)
—
—
—
—
Carrying
value
R’m
Contractual
cash flows
R’m
0 – 12
months
R’m
1 – 2
years
R’m
2 years +
R’m
Derivative financial liabilities
– Forward exchange contracts – outflow
– Forward exchange contracts – inflow
– Shareholders’ liabilities
– Interest rate swaps
(597)
—
(683)
(15)
(5 901)
5 237
(708)
(15)
(3 641)
3 136
(123)
(15)
(2 260)
2 101
(57)
—
—
—
(528)
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
101
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Liquidity risk (continued)
31 March 2010
Non-derivative financial liabilities
– Interest-bearing:
Capitalised finance leases
– Interest-bearing:
Loans and other
– Non-interest-bearing:
Programme and film rights
– Non-interest-bearing:
Loans and other
– Trade payables
– Accrued expenses and other current
liabilities
– Related party payables
– Dividends payable
– Bank overdrafts and call loans
Carrying
value
R’m
Contractual
cash flows
R’m
0 – 12
months
R’m
1 – 5
years
R’m
5 years +
R’m
(2 065)
(2 881)
(451)
(928)
(1 502)
(7 471)
(7 794)
(615)
(7 152)
(27)
(736)
(762)
(705)
(57)
(153)
(1 721)
(2 138)
(9)
(2)
(958)
(152)
(1 721)
(21)
(1 721)
(127)
—
(2 138)
(9)
(2)
(958)
(2 138)
(9)
(2)
(958)
—
—
—
—
—
(4)
—
—
—
—
—
Carrying
value
R’m
Contractual
cash flows
R’m
0 – 12
months
R’m
1 – 2
years
R’m
2 years +
R’m
Derivative financial liabilities
– Forward exchange contracts – outflow
– Forward exchange contracts – inflow
– Shareholders’ liabilities
– Interest rate swaps
(723)
—
(650)
(158)
(5 353)
4 367
(658)
(159)
(3 428)
2 484
(76)
(151)
(1 925)
1 883
(63)
(8)
—
—
(519)
—
102
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
38. FINANCIAL RISK MANAGEMENT (continued)
Interest rate risk
As part of the process of managing the group’s fixed and floating borrowings mix, the interest rate
characteristics of new borrowings and the refinancing of existing borrowings are positioned according
to expected movements in interest rates. Where appropriate, the group uses derivative instruments,
such as interest rate swap agreements, purely for hedging purposes. The fair value of these
instruments will not change significantly as a result of changes in interest rates due to their short-term
nature and the floating interest rates. As at 31 March 2011 the group had the following interest rate
swaps in place:
Institution
Rand Merchant Bank
Rand Merchant Bank
Investec
Fair value
of liability
R’m
Loan
amount
R’m
Rate of
loan % Rate of swap
—
(8)
(7)
(15)
8
250
250
7,43
9,80
11,00
3-month average JIBAR with cap
of 12,42%
3-month average JIBAR with cap
of 9,80%
3-month average JIBAR with cap
of 12,3% and floor of 11,2%
Please refer to note 18 for the interest rate profile and repayment terms of long-term liabilities as at
31 March 2011 and 31 March 2010.
Interest rate sensitivity analysis
The sensitivity analysis below has been determined based on the exposure to interest rates for both
derivative and non-derivative instruments at the statement of financial position date (after taking into
account the effect of hedging) and the stipulated change taking place at the beginning of the next
financial year and held constant throughout the reporting period in the case of instruments that have
floating rates. The group is mainly exposed to interest rate fluctuations of the South African, American
and European repo rates. The following changes in the repo rates represent management’s best
estimate of the possible change in interest rates at the respective year-ends:
(cid:96) South African repo rate: increases by 100 basis points (2010: increased by 100 basis points)
(cid:96) American, European and London Interbank Rates: increases by 100 basis points each
(2010: increased by 100 basis points each)
If interest rates changes as stipulated above and all other variables were held constant, specifically
foreign exchange rates, the group’s profit after tax for the year ended 31 March 2011 would increase
by R4,2m (2010: increased by R23,2m). Other equity would remain unchanged (2010: remained
unchanged).
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
103
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
39. FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair values, together with the carrying values, net gains and losses recognised in profit and loss, total
interest income, total interest expense and impairment of each class of financial instrument are as follows:
31 March 2011
Assets
Investments and loans
Loans and receivables
Held-to-maturity investment and
loans
Originated loans
Related party loans
Receivables and loans
Accounts receivable
Other receivables
Related party receivables
Derivative financial instruments
Foreign exchange contracts
Other derivatives – shareholders’
assets
Cash and cash equivalents
Total
Liabilities
Long-term liabilities
Interest-bearing:
Capitalised finance leases
Interest-bearing: Loans and other
Non-interest-bearing:
Loans and other
Short-term payables and loans
Interest-bearing:
Capitalised finance leases
Interest-bearing: Loans and other
Non-interest-bearing:
Programme and film rights
Non-interest-bearing:
Loans and other
Trade payables
Accrued expenses and other
current liabilities
Related party payables
Derivative financial instruments
Foreign exchange contracts
Other derivatives – shareholders’
liabilities
Other derivatives – interest rate
swaps
Bank overdrafts and call loans
Total
Carrying
value
R’m
3 436
3 154
141
4
137
3 702
2 929
735
38
18
15
3
Fair
value
R’m
3 436
3 154
141
4
137
3 702
2 929
735
38
18
15
3
8 731
15 887
8 731
15 887
12 838
12 838
1 893
10 822
123
5 922
254
493
748
16
1 916
2 402
93
1 313
612
686
15
1 893
10 822
123
5 922
254
493
748
16
1 916
2 402
93
1 313
612
686
15
1 330
21 403
1 330
21 403
Net gains
and
(losses)
recognised
in profit
and loss
R’m
Total
interest
income
R’m
Total
interest
expense
R’m
Impair-
ment
R’m
—
—
—
—
—
(23)
4
(1)
(26)
(61)
(61)
—
(32)
(116)
—
—
—
—
66
13
—
64
(12)
(4)
8
(3)
(613)
(614)
16
(15)
—
(547)
221
217
—
—
4
86
13
73
—
—
—
—
309
616
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
1 017
133
884
—
125
21
26
14
—
52
12
—
52
—
52
—
105
1 299
6
—
—
—
6
127
125
—
2
—
—
—
—
133
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
104
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
39. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
31 March 2010
Assets
Investments and loans
Loans and receivables
Originated loans
Related party loans
Receivables and loans
Accounts receivable
Other receivables
Related party receivables
Cash and cash equivalents
Total
Liabilities
Long-term liabilities
Interest-bearing:
Capitalised finance leases
Interest-bearing:
Loans and other
Non-interest-bearing:
Loans and other
Short-term payables and loans
Interest-bearing:
Capitalised finance leases
Interest-bearing:
Loans and other
Non-interest-bearing:
Programme and film rights
Non-interest-bearing:
Loans and other
Trade payable
Accrued expenses and other
current liabilities
Related party payables
Dividends payable
Derivatives
Foreign exchange contracts
Other derivatives –
shareholders’ liabilities
Other derivatives –
interest rate swaps
Bank overdrafts and call loans
Carrying
value
R’m
3 503
3 417
5
81
3 106
2 438
642
26
6 785
Fair
value
R’m
3 503
3 417
5
81
3 106
2 438
642
26
6 785
13 394
13 394
8 750
8 738
1 736
6 877
137
5 545
329
594
736
16
1 721
2 138
9
2
1 531
723
650
158
958
1 736
6 865
137
5 527
329
576
736
16
1 721
2 138
9
2
1 531
723
650
158
958
Net gains
and
(losses)
recognised
in profit
and loss
R’m
Total
interest
income
R’m
Total
interest
expense
R’m
Impair-
ment
R’m
(6)
—
—
(6)
133
2
(2)
133
78
205
32
30
—
2
(8)
52
—
(61)
—
47
37
(83)
—
(378)
(374)
(10)
6
5
272
268
—
4
27
1
26
—
315
614
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
524
55
461
8
144
37
23
33
—
26
23
2
—
72
—
42
30
101
841
367
330
—
37
44
44
—
—
—
411
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Total
16 784
16 754
(349)
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
105
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
39. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
The fair value of financial instruments was calculated using market information and other relevant valuation techniques,
and does not necessarily represent the values that the group will realise in the normal course of business. The carrying
amounts of cash and cash equivalents, bank overdrafts, receivables and payables are deemed to reflect fair value due to
the short maturities of these instruments. The fair values of forward exchange contracts and other derivative instruments
are based on quoted market prices, other prices that are observable for the asset or liability, either directly or indirectly, or
valuation techniques that include unobservable inputs. The fair values of interest-bearing loans are calculated based on
discounted expected future principal and interest cash flows.
The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at
fair value, grouped into levels 1 to 3 based on the degree to which the fair value is observable:
(cid:96) Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical
assets or liabilities.
(cid:96) Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1 that
are observable for the asset or liability, either directly (ie as prices) or indirectly (ie derived from prices).
(cid:96) Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or
liability that are not based on observable market data (unobservable inputs).
Fair value
R’m
Level 1
R’m
Level 2
R’m
Level 3
R’m
Total
R’m
31 March 2011
Assets/liabilities measured
at fair value:
Assets
Foreign exchange contracts
Other derivatives –
shareholders’ assets
Total
Liabilities
Foreign exchange contracts
Other derivatives –
shareholders’ liabilities
Other derivatives –
interest rate swaps
Total
31 March 2010
Liabilities measured
at fair value:
Liabilities
Foreign exchange contracts
Other derivatives –
shareholders’ liabilities
Other derivatives –
interest rate swaps
Total
15
3
18
612
686
15
1 313
Fair value
R’m
723
650
158
1 531
—
—
—
—
—
—
—
15
—
15
612
—
15
627
—
3
3
—
686
—
686
Level 1
R’m
Level 2
R’m
Level 3
R’m
—
—
—
—
723
—
158
881
—
650
—
650
15
3
18
612
686
15
1 313
Total
R’m
723
650
158
1 531
There were no transfers between level 1 and level 2 during the period.
106
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
39. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
The following table presents the changes in level 3 instruments for the year ending 31 March 2011:
Other
derivatives –
shareholders’
assets
R’m
Other
derivatives –
shareholders’
liabilities
R’m
Total
R’m
—
—
3
—
—
3
—
—
—
—
—
—
—
—
3
—
—
3
—
—
—
—
—
—
650
42
31
(19)
(18)
686
360
53
264
(22)
(5)
650
Total
R’m
650
42
31
(19)
(18)
686
360
53
264
(22)
(5)
650
Reconciliation of level 3 instruments:
Opening balance at 1 April 2010
Total losses in income statement
Purchases
Settlements
Foreign currency translation effects
Closing balance 31 March 2011
Opening balance at 1 April 2009
Total losses in income statement
Purchases
Foreign currency translation effects
Settlements
Closing balance 31 March 2010
Total losses for the period included in the income statement for assets and liabilities still held at the end of the period
amounted to R41,7m (2010: R53,0m). Of this amount included in the income statement a loss of R85,6m (2010:
a loss of R42,7m) was included in (cid:2130)Other finance income/(costs) – net”, a profit of R56,6m (2010: a loss of R5,3m)
in (cid:2130)Other gains/(losses) – net”, and a loss of R12,6m (2010: a loss of R4,8m) in (cid:2130)Foreign exchange profits/(losses)”.
If one or more of the inputs were changed to a reasonable possible alternative assumption, there would be no
significant change in the fair value measurements of level 3 instruments.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
107
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS
The following share incentive plans were in operation during the financial year:
Date of
incorporation
Maximum
awards
permissible4
Vesting
period
Period
to expiry
from date
of offer
IFRS 2
classification
Share trusts
Naspers
Media24
Paarl Media Holdings
Via Afrika
MIH Holdings
MIH (Mauritius)
Irdeto Access
MIH China (BVI)
2005 MIH China (BVI)
Entriq (Mauritius)
MediaZone Holdings B.V.
M-Net
SuperSport
MIH India (Mauritius)
MIH Russia Internet B.V.
MIH BuscaPé Holdings B.V.
SARs
Media24
MultiChoice Africa
M-Net/SuperSport
MIH Brazil Holdings B.V.
Irdeto Access B.V.
Cloakware Inc. 2008
MIH Entriq Investments
B.V. 2008
Gadu-Gadu S.A. 2008
MIH Allegro B.V. 2008
MIH Ricardo B.V. 2008
Irdeto Access B.V. 2008
Note1
14 August 1987
15%
31 August 2000
5%
29 May 2001
21 November 2003
10%
27 September 1993 Note1
Note1
25 March 1999
10%
14 October 1999
Note2
23 February 2003
30 September 2005 Note2
15%
6 May 2003
15%
8 August 2006
Note1
12 June 1991
Note1
12 June 1991
15%
22 February 2007
10%
4 June 2007
6%
15 March 2010
20 September 2005
20 September 2005
20 September 2005
9 June 2006
9 June 2006
11 July 2008
11 July 2008
11 July 2008
11 July 2008
11 July 2008
5 September 2008
10%
10%
10%
10%
15%
15%
10%
10%
10%
15%
15%
*
*
*
*
*
*
*
**
**
**
**
*
*
***
***
*
*
*
*
*
*
***
***
***
***
***
***
Equity-settled
10 years
Cash-settled
10 years
Cash-settled
10 years
Cash-settled
10 years
Equity-settled
10 years
Equity-settled
10 years
Note3
10 years
Equity-settled
10 years
Equity-settled
5 to 8 years
Cash-settled
10 years
Equity-settled
10 years
Equity-settled
10 years
Equity-settled
10 years
Equity-settled
10 years
10 years
Equity-settled
5 years and 3 months Equity-settled
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
Equity-settled
Equity-settled
Equity-settled
Equity-settled
108
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Date of
incorporation
Maximum
awards
permissible4
Vesting
period
Period
to expiry
from date
of offer
MIH (China) Mauritius 2008
5 September 2008
10%
MultiChoice Africa 2008
Allegro BV 2009
Molotok No1
MIH Internet Africa
On the Dot
Paarl Coldset5
Paarl Media Holdings5
2 April 2008
25 September 2009
12 June 2009
9 June 2010
24 November 2010
10 March 2010
10 March 2010
10%
10%
10%
10%
10%
5%
5%
***
*
***
*
*
*
*
*
5 years and 14 days
and 8 years and
14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
5 years and 14 days
IFRS 2
classification
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Equity-settled
Notes
1 These share trusts issue Naspers N ordinary shares. Collectively the maximum number of shares available for fresh
allocation after 27 August 2010 is 40 588 541 shares which number will increase by virtue of any subdivision of
shares or decrease by virtue of any consolidation of shares, as the case may be.
2 The MIH China (BVI) and 2005 MIH China (BVI) share trusts may collectively issue no more than 10% of the total
number of MIH China Limited ordinary shares in issue.
3 Offers before September 2005 are cash-settled and offers after September 2005 are equity-settled.
4 The percentage reflected in this column is the maximum percentage of the respective companies issued/notional
share capital that the applicable Trust/SAR plan may hold and subsequently allocate to participants.
5 For these two schemes, the initial grants vest one-third after two, three and four years with all subsequent grants
vesting as indicated in the table above.
Vesting period:
* One-third vests after years three, four and five.
** One-quarter vests after years one, two, three and four.
*** One-fifth vests after years one, two, three, four and five.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
109
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Additional information
All share options are granted with an exercise price of not less than 100% of market value or fair value
of the respective company’s shares on the date of the grant. All SARs are granted with an exercise
price of not less than 100% of fair value of the SARs on the date of the grant. All unvested share
options/SARs are subject to forfeiture upon termination of employment. All cancelled options/SARs
are cancelled by mutual agreement between the employer and employee.
Movements in terms of the share trust incentive plans are as follows:
31 March 2011
Naspers
Media24
Paarl
Media
Via
Afrika
MIH
Holdings
MIH
(Mauritius)
(US$-
based)
Shares
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
share price of
options taken up
during the year
Shares
Weighted average
share price
17 377 338
29 386
(181 087)
(8)
—
636 734
—
(428 892)
(1 568)
(70 270)
139 700
—
(97 960)
—
—
877 297
13 172
—
105 684
— (109 612)
(15 503)
(144)
(13 172)
—
57 700
—
(14 450)
—
—
17 225 629
136 004
41 740
—
857 722
43 250
9 067 656
136 004
41 740
—
290 682
43 250
(rand)
(rand)
(rand)
(rand)
(rand)
(US$)
131,42
278,76
78,28
131,42
—
8,36
—
7,86
8,84
6,94
6,91
—
5,21
—
—
132,23
10,66
10,90
89,15
10,66
10,90
181 087
428 892
97 960
364,81
29,25
27,93
5,00
—
—
5,00
—
—
—
—
—
148,24
316,01
111,73
178,12
92,42
2,39
—
1,98
—
—
173,05
2,53
91,59
2,53
109 612
14 450
348,71
51,33
110
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share trust incentive plans are as follows:
31 March 2010
Naspers
Media24
Paarl
Media
Via
Afrika
MIH
Holdings
MIH
(Mauritius)
(US$-
based)
Shares
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
share price of
options taken up
during the year
Shares
Weighted average
share price
17 557 772
37 553
(175 781)
(33 404)
(8 802)
938 083
—
(260 194)
(41 155)
—
704 073
—
(549 040)
(15 333)
—
983 237
66 822
—
178 786
— (221 524)
(62 864)
(338)
(53 650)
—
204 071
—
(145 041)
(1 330)
—
17 377 338
636 734
139 700
13 172
877 297
57 700
5 156 990
621 724
139 700
13 172
202 067
57 700
(rand)
(rand)
(rand)
(rand)
(rand)
(US$)
130,23
261,71
39,54
166,07
24,87
8,76
—
9,62
9,43
—
10,59
—
11,50
11,50
—
5,00
—
—
5,00
—
111,70
257,98
72,18
157,57
26,99
2,83
—
3,01
2,12
—
131,42
8,36
6,91
5,00
148,24
2,39
28,19
8,07
6,91
5,00
57,58
2,39
175 781
260 194
549 040
257,25
29,15
29,07
—
—
221 524
145 041
245,98
28,69
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
111
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share trust incentive plans are as follows:
31 March 2011
Shares
Outstanding at 1 April
Granted
Exercised
Forfeited
Outstanding at 31 March
Available to be implemented
at 31 March
Weighted average exercise
price
Outstanding at 1 April
Granted
Exercised
Forfeited
Outstanding at 31 March
Available to be implemented
at 31 March
Weighted average share
price of options taken up
during the year
Shares
Weighted average share price
MIH
(Mauritius)
(rand-
based)
Irdeto
Access
B.V.
MIH
China
(BVI)
2005
MIH
China
(BVI)
Entriq
7 799 157
195 227
(328 906)
(75 891)
438 205
—
(39 013)
(10 949)
7 589 587
388 243
6 875
—
—
—
6 875
14 916
—
(1 523)
(30)
3 752 100
—
—
(135 300)
13 363
3 616 800
4 422 688
358 989
6 875
13 156
3 616 800
(rand)
(US$)
(US$)
(US$)
(US$)
116,48
310,15
98,65
171,50
121,68
7,67
—
8,21
8,86
7,58
761,11
246,81
—
—
—
893,65
— 2 481,05
246,81
742,14
80,19
7,39
246,81
714,78
328 906
345,60
39 013
12,89
—
1 523
— 13 727,00
0,65
—
—
0,65
0,65
0,65
—
—
112
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share trust incentive plans are as follows:
31 March 2010
Shares
Outstanding at 1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at 31 March
Available to be implemented
at 31 March
Weighted average exercise
price
Outstanding at 1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at 31 March
Available to be implemented at
31 March
Weighted average share
price of options taken up
during the year
Shares
Weighted average share price
MIH
(Mauritius)
(rand-
based)
Irdeto
Access
B.V.
8 066 131
527 045
(705 768)
(88 251)
—
566 231
—
(106 078)
(21 948)
—
MIH
China
(BVI)
7 963
—
(1 088)
—
—
2005
MIH
China
(BVI)
Entriq
23 234
—
(8 263)
(55)
—
4 244 500
—
—
(427 400)
(65 000)
7 799 157
438 205
6 875
14 916
3 752 100
3 466 386
336 502
6 875
14 125
3 727 650
(rand)
(US$)
(US$)
(US$)
(US$)
102,07
263,69
56,96
145,55
—
116,48
7,52
—
7,13
8,79
—
7,67
246,62
—
245,47
767,03
—
770,36
— 1 872,39
—
—
246,81
761,11
56,96
7,22
246,81
690,27
705 768
232,48
106 078
14,74
1 088
8 964,98
8 263
10 018,19
0,65
—
—
0,65
0,65
0,65
0,65
—
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
113
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share trust incentive plans are as follows:
31 March 2011
Shares
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
share price of
options taken up
during the year
Shares
Weighted average
share price
Media-
Zone
M-Net
Super-
Sport
MIH
India
MIH
Russia
MIH
BuscaPé
346 000
—
—
(11 000)
—
31 774
—
(7 068)
(69)
(80)
42 113 12 419 251
— 2 500 109
—
(2 534 892)
—
(9 578)
(101)
(165)
730 131
20 000
(38 802)
(9 525)
—
804 295
133 000
—
—
—
335 000
24 557
32 269 12 384 468
701 804
937 295
335 000
24 557
32 269
5 234 544
215 103
—
(US$)
(rand)
(rand)
(US$)
(euro)
(euro)
0,82
—
—
0,82
—
8,81
—
9,25
8,67
9,23
34,60
—
35,66
30,82
23,90
0,55
0,58
—
0,55
—
14,31
14,37
12,64
14,69
—
15,40
15,40
—
—
—
0,82
8,68
34,35
0,55
14,40
15,40
0,82
8,68
34,35
0,54
13,76
—
—
—
7 068
9 578
317,19
316,37
—
—
38 802
65,39
—
—
114
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share trust incentive plans are as follows:
31 March 2010
Shares
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted average
share price of
options taken up
during the year
Shares
Weighted average
share price
Media-
Zone
M-Net
Super-
Sport
MIH
India
MIH
Russia
MIH
BuscaPé
501 500
—
—
(155 500)
57 413
—
(25 639)
—
75 123 10 369 940
— 4 418 821
—
— (2 369 510)
(33 010)
245 207
492 793
—
(7 869)
—
804 295
—
—
346 000
31 774
42 113 12 419 251
730 131
804 295
259 500
31 774
42 113
3 578 959
94 918
—
(US$)
(rand)
(rand)
(US$)
(euro)
(euro)
0,82
—
—
0,82
8,75
—
8,68
—
34,83
—
35,11
—
0,54
0,57
—
0,54
12,64
15,12
—
12,64
—
15,40
—
—
0,82
8,81
34,60
0,55
14,31
15,40
0,82
8,81
34,60
0,54
12,64
—
—
—
25 639
33 010
215,37
215,71
—
—
—
—
—
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
115
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
31 March 2011
Media24
Multi-
Choice
Africa
M-Net/
SuperSport MIH Brazil
Irdeto
Access
MultiChoice
Africa 2008
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise price
Outstanding
at 1 April
Granted
Exercised
Forfeited
Expired
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up during
the year
SARs
Weighted average
SAR price
10 065 856
6 764 874
(930 416)
(4 759 998)
4 949 377
—
— (2 558 788)
(166 902)
(17 634)
3 360 116
—
(2 328 494)
(79 955)
(13 065)
224 853
—
(5 228)
(22 366)
—
188 044
—
—
(6 345)
—
3 303 087
3 483 220
(44 961)
(249 216)
—
11 140 316
2 206 053
938 602
197 259
181 699
6 492 130
1 005 921
311 596
168 621
81 927
60 495
—
(rand)
(rand)
(rand)
(US$)
(US$)
(rand)
22,36
17,46
—
21,17
21,55
42,86
—
34,20
49,59
23,70
9,28
—
9,17
9,36
9,00
44,84
—
42,17
48,59
—
15,20
—
—
15,20
—
75,84
91,61
72,76
80,22
—
19,83
52,55
9,56
44,48
15,20
84,15
24,67
50,61
9,56
42,17
15,20
—
— 2 558 788
2 328 494
5 228
—
73,65
25,07
50,99
—
—
44 961
91,74
116
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
31 March 2010
Media24
Multi-
Choice
Africa
M-Net/
SuperSport MIH Brazil
Irdeto
Access
MultiChoice
Africa 2008
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up during
the year
SARs
Weighted average
SAR price
9 618 622
2 201 342
(5 011)
(1 438 688)
(310 409)
7 530 463
—
(2 324 719)
(256 367)
—
5 716 714
—
(2 186 829)
(169 769)
—
170 600
54 253
—
—
—
306 943
—
(33 942)
(84 957)
—
1 580 233
1 921 083
(82 193)
(116 036)
—
10 065 856
4 949 377
3 360 116
224 853
188 044
3 303 087
3 577 140
180 922
321 185
42 313
—
—
(rand)
(rand)
(rand)
(US$)
(US$)
(rand)
22,61
21,40
21,55
22,86
21,55
38,46
—
29,08
38,50
—
9,25
—
9,20
9,23
—
43,91
47,77
—
—
—
15,20
—
15,20
15,20
—
69,31
80,74
69,31
72,74
—
22,36
42,86
9,28
44,84
15,20
75,84
21,86
30,46
9,13
42,17
—
—
5 011
2 324 719
2 186 829
23,65
73,65
25,07
—
—
33 942
82 193
16,00
82,18
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
117
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
Irdeto
Acess
B.V. 2008
Gadu-
Gadu
S.A. 2008
MIH
Allegro
B.V. 2008
MIH
(China)
Mauritius
2008
Cloak-
ware
Inc. 2008
MIH
Entriq
Invest-
ments
B.V. 2008
811 773
554 974
(28 539)
(49 489)
—
883 296
317 022
—
(235 058)
—
433 499
—
(34 591)
(7 130)
—
12 010
44
(53)
—
—
1 288 719
965 260
391 778
12 001
165 738
219 058
109 745
4 150
7 351
—
—
(6 371)
(980)
—
—
—
—
—
—
—
—
—
(US$)
(PLN)
(euro)
(US$)
(US$)
(US$)
11,63
13,60
10,20
11,65
—
13,55
13,55
—
13,55
—
47,15
6 049,81
— 12 223,34
3 352,92
—
—
43,84
51,54
—
12,51
13,55
47,37
6 084,35
12,87
13,55
43,29
5 556,14
28 539
13,60
—
—
34 591
53
86,25
13 096,73
7,25
—
—
7,25
7,25
—
—
—
—
—
—
—
—
—
—
—
—
—
31 March 2011
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up during
the year
SARs
Weighted average
SAR price
118
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
Irdeto
Acess
B.V. 2008
Gadu-
Gadu
S.A. 2008
MIH
Allegro
B.V. 2008
MIH
(China)
Mauritius
2008
Cloak-
ware
Inc. 2008
MIH
Entriq
Invest-
ments
B.V. 2008
208 927
617 283
—
(14 437)
—
636 580
357 856
—
(111 140)
—
398 121
106 015
(67 595)
(3 042)
—
162 699
9 039
—
2 971
—
—
—
(17 598)
— (137 750)
749 120
—
—
(182 488)
(566 632)
811 773
883 296
433 499
12 010
7 351
39 897
109 095
53 727
1 806
1 468
—
—
(US$)
(PLN)
(euro)
(US$)
(US$)
(US$)
16,00
10,20
—
13,75
—
13,55
13,55
—
13,55
—
38,16
74,93
38,16
38,16
—
4 847,35
9 708,18
—
—
—
7,25
—
—
7,25
7,25
11,63
13,55
47,15
6 049,81
7,25
16,00
13,55
38,16
4 848,20
7,25
—
—
—
—
67 595
74,93
—
—
—
—
2,22
—
—
2,22
2,22
—
—
—
—
31 March 2010
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise price
Outstanding at
1 April
Granted
Exercised
Forfeited
Cancelled
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up during
the year
SARs
Weighted average
SAR price
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
119
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
31 March
2011
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise
price
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up
during the
year
SARs
Weighted
average SAR
price
MIH
Ricardo
B.V. 2008
Allegro
B.V. 2009
Molotok
No1
MIH
Internet
Africa
On the
Dot
Paarl
Coldset
Paarl
Media
Holdings
1 761 540
225 338
(45 279)
(63 173)
78 857
45 830
—
—
284 226
—
— 750 389
—
—
—
—
—
—
—
482 000 2 956 000 2 380 000
—
(40 000)
—
—
—
—
1 878 426
124 687
284 226
750 389
482 000 2 956 000 2 340 000
587 563
15 766
—
—
—
—
—
(euro)
(euro)
(euro)
(rand)
(rand)
(rand)
(rand)
1,58
1,74
1,58
1,59
74,93
87,02
—
—
17,80
—
—
—
—
20,70
—
—
—
20,27
—
—
—
4,35
—
—
—
28,38
—
28,38
1,60
79,37
17,80
20,70
20,27
4,35
28,38
1,58
74,93
—
—
—
—
—
45 279
1,74
—
—
—
—
—
—
—
—
—
—
—
—
120
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Movements in terms of the share appreciation rights plans are as follows:
31 March
2010
SARs
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average
exercise
price
Outstanding at
1 April
Granted
Exercised
Forfeited
Outstanding at
31 March
Available to be
implemented at
31 March
Weighted
average share
price of SARs
taken up
during the
year
SARs
Weighted
average SAR
price
MIH
Ricardo
B.V. 2008
Allegro
B.V. 2009
Molotok
No1
MIH
Internet
Africa
On the
Dot
Paarl
Coldset
Paarl
Media
Holdings
1 615 075
418 489
(39 891)
(232 133)
—
78 857
—
—
—
284 226
—
—
1 761 540
78 857
284 226
268 595
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
(euro)
(euro)
(euro)
(rand)
(rand)
(rand)
(rand)
1,58
1,59
1,58
1,58
—
74,93
—
—
—
17,80
—
—
1,58
74,93
17,80
1,58
—
—
39 891
1,59
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
121
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share option allocations outstanding and currently available to be implemented at 31 March 2011
by exercise price:
Share options outstanding
Share options currently
available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
Exercise price/range
of exercise price
Naspers Limited
(rand)
10,00 – 20,00
20,01 – 25,00
25,01 – 30,00
30,01 – 35,00
40,01 – 45,00
45,01 – 50,00
50,01 – 60,15
110,00 – 120,00
120,01 – 130,00
130,01 – 145,00
160,01 – 175,00
175,01 – 200,00
250,01 – 275,00
275,01 – 300,00
300,00 – 320,00
340,00 – 360,00
Media24 Limited
(rand)
6,04
6,90
6,92
8,12
11,63
20,42
Paarl Media
Holdings (rand)
4,80
11,50
18 168
2 567 411
813 701
1 490 854
11 550
100 000
1 982
163 668
9 437
216 239
3 962 438
7 803 242
46 871
10 870
3 334
5 864
1,47
1,51
1,75
1,71
3,20
3,44
3,42
5,35
5,44
6,95
7,00
7,00
8,78
8,91
9,44
9,96
18,10
23,42
28,94
30,96
42,89
50,00
50,45
114,52
124,00
138,87
167,31
180,83
251,86
288,00
306,00
351,95
18 168
2 567 411
813 701
1 490 854
11 550
100 000
1 982
100 000
4 718
54 513
3 904 759
—
—
—
—
—
17 225 629
132,23
9 067 656
35 316
10 008
1 830
11 015
59 592
18 243
136 004
3 740
38 000
41 740
0,92
1,67
0,50
2,81
3,47
4,47
0,50
4,00
6,04
6,90
6,92
8,12
11,63
20,42
10,66
4,80
11,50
10,90
35 316
10 008
1 830
11 015
59 592
18 243
136 004
3 740
38 000
41 740
18,10
23,42
28,94
30,96
42,89
50,00
50,45
114,52
124,00
138,87
167,24
—
—
—
—
—
89,15
6,04
6,90
6,92
8,12
11,63
20,42
10,66
4,80
11,50
10,90
122
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share option allocations outstanding and currently available to be implemented at 31 March 2011
by exercise price:
Share options outstanding
Share options currently
available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
Exercise price/range
of exercise price
MIH Holdings
Limited (rand)
6,91 – 20,00
20,01 – 40,00
40,01 – 60,00
100,01 – 120,00
120,01 – 140,00
140,01 – 160,00
160,01 – 180,00
180,01 – 200,00
250,01 – 275,00
300,01 – 320,00
360,00 – 380,00
MIH (Mauritius)
Limited (US$)
1,10
1,11 – 2,50
2,51 – 5,00
MIH (Mauritius)
Limited (rand)
8,19 – 15,00
15,01 – 40,00
40,01 – 65,00
100,01 – 125,00
125,01 – 145,00
145,01 – 160,00
160,01 – 175,00
175,01 – 190,00
250,01 – 275,00
275,01 – 300,00
300,01 – 320,00
360,00 – 380,00
380,00 – 400,00
21 639
50 780
41 288
55 648
279 145
85
56 282
75 922
149 108
113 416
14 409
857 722
5 750
13 330
24 170
43 250
88 733
1 807 885
525 237
889 125
1 448 102
869 952
982 740
285 159
382 379
417
299 306
6 725
3 827
7 589 587
0,88
2,00
2,92
4,45
6,53
7,93
7,14
6,37
8,43
9,34
9,68
1,10
0,70
2,40
0,88
2,02
3,22
4,93
6,94
7,79
6,05
6,83
8,43
8,70
9,25
9,68
9,79
14,06
25,50
41,65
105,35
134,79
146,50
175,65
186,60
251,00
305,60
379,42
173,05
1,10
2,12
3,09
2,53
8,19
24,17
44,97
119,95
138,90
153,19
174,68
179,59
251,14
292,56
305,25
379,42
388,70
21 639
50 780
41 288
55 648
96 571
—
7 027
17 729
—
—
—
290 682
5 750
13 330
24 170
43 250
88 733
1 807 885
525 237
826 849
475 963
31 248
624 372
42 401
—
—
—
—
—
121,68
4 422 688
14,06
25,50
41,65
105,35
133,29
—
174,95
188,38
—
—
—
91,59
1,10
2,12
3,09
2,53
8,19
24,17
44,97
119,65
138,92
145,99
174,99
182,00
—
—
—
—
—
80,19
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
123
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share option allocations outstanding and currently available to be implemented at 31 March 2011
by exercise price:
Share options outstanding
Share options currently
available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
230 527
81 340
76 376
388 243
2 500
4 375
6 875
11 981
50
728
604
13 363
3,24
4,50
5,47
1,90
3,19
4,44
1,67
3,44
4,25
6,70
7,90
9,90
7,58
34,00
368,41
246,81
612,75
654,02
1 434,92
2 481,05
742,14
230 527
81 340
47 122
358 989
2 500
4 375
6 875
11 981
50
728
397
13 156
6,70
7,90
9,90
7,39
34,00
368,41
246,81
612,75
654,02
1 434,92
2 481,05
714,78
Exercise price/range
of exercise price
Irdeto Access B.V.
(US$)
6,70
7,90
9,90
MIH China (BVI)
Limited (US$)
34,00
368,41
2005 MIH China (BVI)
Limited (US$)
612,75
654,02
1 434,92
2 481,05
Entriq (Mauritius)
Limited (US$)
0,65
3 616 800
3,95
0,65
3 616 800
0,65
MediaZone Holdings
B.V. (US$)
0,82
335 000
M-Net Limited (rand)
8,51 – 13,50
13,51 – 30,50
24 541
16
24 557
5,36
1,87
2,84
0,82
335 000
0,82
8,67
16,88
8,68
24 541
16
24 557
8,67
16,88
8,68
124
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share option allocations outstanding and currently available to be implemented at 31 March 2011
by exercise price:
Share options outstanding
Share options currently
available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
9 827
15
22 427
32 269
6 542 323
3 581 583
2 260 562
12 384 468
196 886
20 000
484 918
701 804
1,87
2,84
1,87
6,36
8,58
9,44
6,18
9,44
8,99
—
28,65
49,41
34,35
0,54
0,57
0,58
0,55
12,64
14,37
15,12
14,40
9 827
15
22 427
32 269
4 518 239
716 305
—
5 234 544
118 122
—
96 981
215 103
—
28,65
49,41
34,35
0,54
0,57
—
0,54
12,64
—
15,12
13,76
937 295
4,31
15,40
—
—
Exercise price/range
of exercise price
SuperSport Limited
(rand)
—
25,01 – 40,00
40,01 – 55,00
MIH India (US$)
0,54
0,57
0,58
MIH Russia (euro)
12,64
14,37
15,12
MIH BuscaPé (euro)
15,40
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
125
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights allocations outstanding and currently available to be implemented at
31 March 2011 by exercise price:
Exercise price/range
of exercise price
Media24 Limited (rand)
17,46
21,40
21,55
23,65
24,75
25,15
MultiChoice Africa
(Proprietary) Limited
(rand)
23,70
39,87
58,21
M-Net/SuperSport
(rand)
9,56
MIH Brazil Holdings
B.V. (US$)
42,17
47,57
50,39
Irdeto Access B.V. (US$)
15,20
MultiChoice Africa
2008 (rand)
69,31
82,18
91,74
Irdeto Access B.V.
2008 (US$)
10,20
13,60
16,00
SARs outstanding
SARs currently available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
6 580 901
1 845 017
64 965
744 398
918 750
986 285
11 140 316
2 392
676 822
1 526 839
2 206 053
4,30
3,55
0,50
2,44
0,62
1,54
0,50
0,49
1,31
17,46
21,40
21,55
23,65
24,75
25,15
19,83
23,70
39,87
58,21
52,55
—
—
64 965
—
612 272
328 684
1 005 921
2 392
124 695
184 509
311 596
—
—
21,55
—
24,75
25,15
24,67
23,70
39,87
58,21
50,61
938 602
0,52
9,56
168 621
9,56
128 185
39 496
29 578
197 259
0,57
3,48
2,58
42,17
47,57
50,39
44,48
81 927
—
—
81 927
42,17
—
—
42,17
181 699
1,53
15,20
60 495
15,20
1 498 701
1 637 536
3 355 893
6 492 130
548 801
548 287
191 631
1 288 719
2,60
3,45
4,45
3,53
4,48
2,52
69,31
82,18
91,74
84,15
10,20
13,60
16,00
12,51
—
—
—
—
89 302
—
76 436
165 738
—
—
—
—
10,20
—
16,00
12,87
126
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights allocations outstanding and currently available to be implemented at
31 March 2011 by exercise price:
SARs outstanding
SARs currently available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
965 260
3,29
13,55
219 058
13,55
38,16
74,93
47,37
94 442
15 303
109 745
38,16
74,93
43,29
293 697
98 081
391 778
81
937
7 968
2 648
44
323
12 001
1 284 864
368 224
225 338
1 878 426
78 857
45 830
124 687
2,41
3,50
2,83
2,97
5,52
3,46
4,47
4,00
2,43
3,48
4,47
3,63
4,47
3 352,92
3 809,17
4 994,57
9 344,20
12 223,34
12 692,10
6 084,35
1,58
1,59
1,74
1,60
74,93
87,02
79,37
284 226
3,99
17,80
750 389
482 000
4,72
4,84
20,70
20,27
—
374
3 186
528
—
62
4 150
—
3 809,17
4 994,57
9 344,20
—
12 692,10
5 556,14
513 924
73 639
—
587 563
15 766
—
15 766
—
—
—
1,58
1,59
—
1,58
74,93
—
74,93
—
—
—
Exercise price/range
of exercise price
Gadu-Gadu S.A.
2008 (PLN)
13,55
MIH Allegro B.V.
2008 (euro)
38,16
74,93
MIH (China) Mauritius
2008 (US$)
3 352,92
3 809,17
4 994,57
9 344,20
12 223,33
12 692,10
MIH Ricardo B.V.
2008 (euro)
1,58
1,59
1,74
Allegro B.V. 2009 (euro)
74,93
87,02
Molotok No1 (euro)
17,80
MIH Internet Africa
(rand)
20,70
On the Dot (rand)
20,27
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
127
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights allocations outstanding and currently available to be implemented at
31 March 2011 by exercise price:
SARs outstanding
SARs currently available
Number
outstanding
at 31 March
2011
Weighted
average
remaining
contractual
life (years)
Weighted
average
exercise
price
Exercisable
at 31 March
2011
Weighted
average
exercise
price
2 956 000
4,02
4,35
2 340 000
4,02
28,38
—
—
—
—
Exercise price/range
of exercise price
Paarl Coldset (rand)
4,35
Paarl Media
Holdings (rand)
28,38
Share trust incentive plans grants made during the year:
Naspers
Limited
(rand)
MIH
Holdings
Limited
(rand)
MIH
(Mauritius)
Limited
(rand)
MIH
India
(US$)
MIH
Russia
(euro)
MIH
BuscaPé
(euro)
128,44
121,78
127,26
0,23
5,30
6,11
31 March 2011
Weighted average
fair value at
measurement date
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted average
share price
Weighted average
exercise price
Weighted average
expected volatility
(%)*
Weighted average
option life (years)
Weighted average
dividend yield (%)
Weighted average
risk-free interest
rate (%) (based on
zero rate bond
yield at perfect fit)
Weighted average
annual suboptimal
rate (%)
Weighted average
vesting period
(years)
278,76
316,01
310,15
278,76
316,01
310,15
32,0
10,0
0,9
30,4
10,0
0,9
30,3
10,0
0,9
0,58
0,58
36,5
10,0
—
14,37
14,37
36,5
10,0
—
15,40
15,40
44,3
5,3
—
8,2
7,5
7,5
2,6
2,6
1,7
71,4
250,0
125,5
90,0
150,0
248,0
4,0
4,0
4,0
3,0
3,0
4,0
* The weighted average expected volatility of all share option grants listed above is determined using historical daily
share prices except for the MIH India, MIH Russia and MIH BuscaPé plans where historical annual company
valuations are used.
128
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share trust incentive plans grants made during the year:
Naspers
Limited
(rand)
MIH
Holdings
Limited
(rand)
MIH
(Mauritius)
Limited
(rand)
MIH
India
(US$)
MIH
Russia
(euro)
MIH
BuscaPé
(euro)
31 March 2010
6,71
15,40
15,40
6,79
38,4
37,8
10,0
0,57
0,30
37,2
0,57
15,12
15,12
254,64
118,52
254,64
261,71
257,82
261,71
115,76
257,82
124,49
Weighted average
fair value at
measurement date
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted average
share price
Weighted average
exercise price
Weighted average
expected volatility
(%)*
Weighted average
option life (years)
Weighted average
dividend yield (%)
Weighted average
risk-free interest
rate (%) (based on
zero rate bond
yield at perfect fit)
Weighted average
annual suboptimal
rate (%)
Weighted average
vesting period
(years)
Various early exercise expectations were calculated based on historical exercise behaviours.
* The weighted average expected volatility of all share option grants listed above is determined using historical daily
share prices except for the MIH India, MIH Russia and MIH BuscaPé plans where historical annual company
valuations are used.
216,0
125,6
150,0
10,0
93,3
90,0
10,0
10,0
51,6
44,5
10,0
8,6
1,2
4,0
1,3
3,7
4,0
8,6
8,6
1,3
3,0
4,0
3,0
3,5
—
—
2,5
248,0
4,0
47,9
5,3
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
129
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights plans grants made during the year:
31 March
2011
Media24
(rand)
MIH Brazil
(US$)
Multi-
Choice
Africa
2008
(rand)
Irdeto
Access
B.V. 2008
(US$)
Gadu-
Gadu S.A.
2008
(PLN)
MIH
Allegro
B.V. 2008
(euro)
MIH
(China)
Mauritius
2008
(US$)
Weighted
average fair
value at
measurement
date
5,39
—
35,15
3,53
4,37
— 3 810,40
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted
average SAR
price
Weighted
average
exercise price
Weighted
average
expected
volatility (%)*
Weighted
average option
life (years)
Weighted
average
risk-free
interest rate
(%) (based
on zero rate
bond yield at
perfect fit)
Weighted
average
annual
suboptimal
rate (%)
Weighted
average
vesting period
(years)
17,46
17,46
15,1
5,0
—
—
—
—
91,61
13,60
13,55
— 12 223,34
91,61
13,60
13,55
— 12 223,34
31,1
28,7
36,8
5,0
5,0
5,0
—
—
36,8
5,0
7,6
—
7,2
1,6
1,6
—
1,1
181,5
—
293,8
118,0
100,0
—
185,3
4,0
—
4,0
3,0
3,0
—
3,0
* The weighted average expected volatility of all SAR grants listed above is determined using historical annual
company valuations, except for the MIH (China) Mauritius 2008 plan where historical daily share prices are used.
130
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights plans grants made during the year:
31 March
2010
Media24
(rand)
MIH Brazil
(US$)
Multi-
Choice
Africa
2008
(rand)
Irdeto
Access
B.V. 2008
(US$)
Gadu-
Gadu S.A.
2008
(PLN)
MIH
Allegro
B.V. 2008
(euro)
MIH
(China)
Mauritius
2008
(US$)
3 619,51
8 293,80
8 293,80
7,6
6,66
34,4
40,0
3,43
5,39
73,72
13,55
13,55
73,72
29,21
21,40
47,77
80,74
10,21
21,40
22,60
10,21
47,77
80,74
Weighted
average fair
value at
measurement
date
34,06
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted
average SAR
price
Weighted
average
exercise price
Weighted
average
expected
volatility (%)*
Weighted
average option
life (years)
Weighted
average
risk-free
interest rate
(%) (based
on zero rate
bond yield at
perfect fit)
Weighted
average
annual
suboptimal
rate (%)
Weighted
average
vesting period
(years)
Various early exercise expectations were calculated based on historical exercise behaviours.
* The weighted average expected volatility of all SAR grants listed above is determined using historical annual
company valuations, except for the MIH (China) Mauritius 2008 plan where historical daily share prices are used.
248,0
293,8
114,5
168,9
248,0
23,1
48,2
93,3
48,3
5,0
2,7
4,0
3,0
4,0
5,0
5,0
8,3
5,0
8,2
8,2
4,0
3,0
5,0
2,6
8,4
5,0
3,0
1,7
171,0
3,0
56,6
5,0
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
131
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights plans grants made during the year:
MIH
Ricardo
B.V.
2008
(euro)
MIH
Allegro
2009
(euro)
Molotok
No1
(euro)
MIH
Internet
Africa
(rand)
On the
Dot
(rand)
Paarl
Coldset
(rand)
Paarl
Media
Holdings
(rand)
0,50
23,52
—
8,76
6,28
1,28
8,36
31 March
2011
Weighted average
fair value at
measurement date
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted average
SAR price
Weighted average
exercise price
Weighted average
expected volatility
(%)*
Weighted average
option life (years)
Weighted average
risk-free interest
rate (%)
(based on zero rate
bond yield at
perfect fit)
Weighted average
annual suboptimal
rate (%)
Weighted average
vesting period
(years)
1,74
87,02
1,74
87,02
31,9
31,9
5,0
5,0
—
—
—
—
20,70
20,27
4,35
28,38
20,70
20,27
4,35
28,38
35,4
15,1
15,1
15,1
5,0
5,0
5,0
5,0
1,6
1,6
—
7,2
7,6
8,2
8,2
100,0
248,0
—
100,0
181,5
181,5
181,5
3,0
3,0
—
4,0
4,0
3,0
3,0
* The weighted average expected volatility of all SAR grants listed above is determined using historical annual
company valuations.
132
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the consolidated annual financial statements (continued)
40. EQUITY COMPENSATION BENEFITS (continued)
Share appreciation rights plans grants made during the year:
MIH
Ricardo
B.V.
2008
(euro)
MIH
Allegro
2009
(euro)
Molotok
No1
(euro)
MIH
Internet
Africa
(rand)
On the
Dot
(rand)
Paarl
Coldset
(rand)
Paarl
Media
Holdings
(rand)
31 March
2010
—
—
—
—
—
—
—
—
—
6,24
0,65
1,59
1,59
43,9
48,2
17,80
17,80
74,93
74,93
27,60
Weighted average
fair value at
measurement date
This weighted average fair value has been calculated using the Bermudan binomial option-pricing
model, using the following inputs and assumptions:
Weighted average
SAR price
Weighted average
exercise price
Weighted average
expected volatility
(%)*
Weighted average
option life (years)
Weighted average
risk-free interest
rate (%) (based on
zero rate bond
yield at perfect fit)
Weighted average
annual suboptimal
rate (%)
Weighted average
vesting period
(years)
Various early exercise expectations were calculated based on historical exercise behaviours.
* The weighted average expected volatility of all SAR grants listed above is determined using historical annual
company valuations.
169,0
248,0
100,0
36,5
2,6
5,0
3,0
2,7
3,0
5,0
2,3
5,0
4,0
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
Share-based payment liability
Total carrying amount of cash-settled share-based payment
liability
Total intrinsic value of liability for vested benefits
31 March
2011
R’m
31 March
2010
R’m
21
17
29
22
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
133
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Company statement of financial position
at 31 March 2011
31 March
31 March
ASSETS
Non-current assets
Investments in subsidiaries
Loans to subsidiaries
Property, plant and equipment
Investments and loans
Deferred taxation
Current assets
Current portion of long-term loans
Other receivables
Cash and cash equivalents
TOTAL ASSETS
EQUITY AND LIABILITIES
Shareholders’ equity
Share capital and premium
Other non-distributable reserves
Retained earnings
Non-current liabilities
Post-retirement medical liability
Current liabilities
Amounts owing in respect of investments acquired
Accrued expenses and other current liabilities
Taxation
Dividends payable
Notes
2
3
4
5
7
3
8
18
9
10
11
12
2011
R’m
24 261
5 453
18 300
2
393
113
1 644
945
12
687
25 905
25 853
17 489
1 795
6 569
3
3
49
13
16
12
8
2010
R’m
24 994
5 453
19 069
2
372
98
1 470
1 245
28
197
26 464
26 417
17 222
1 636
7 559
3
3
44
14
24
6
—
TOTAL EQUITY AND LIABILITIES
25 905
26 464
The accompanying notes are an integral part of these company annual financial statements.
134
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Company statement of comprehensive income
for the year ended 31 March 2011
31 March
31 March
Notes
14
13
15
15
15
16
Revenue
Selling, general and administration expenses
Other gains/(losses) – net
Operating loss
Interest received
Interest paid
Other finance income/(costs) – net
Loss before taxation
Taxation
Loss for the year
Other comprehensive income
Total comprehensive income for the year
Attributable to:
Equity holders of the company
Non-controlling interest
2011
R’m
—
(262)
85
(177)
92
(2)
21
(66)
(10)
(76)
—
(76)
(76)
—
(76)
2010
R’m
—
(247)
(190)
(437)
160
—
38
(239)
(22)
(261)
—
(261)
(261)
—
(261)
The accompanying notes are an integral part of these company annual financial statements.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
135
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Company statement of changes in equity
for the year ended 31 March 2011
Share capital and
premium
A shares N shares
Share-
based
compen-
sation
reserve
Valuation
reserve
Retained
earnings
R’m
R’m
R’m
R’m
R’m
Total
R’m
Balance at 1 April 2009
14
16 774
181
1 296
8 621
26 886
Total comprehensive income for
the year
Share capital issued
Share-based compensation reserve
movement
Dividends
—
—
—
—
—
434
—
—
Balance at 31 March 2010
14
17 208
Balance at 1 April 2010
14
17 208
Total comprehensive income for
the year
Share capital issued
Treasury shares movement
Share-based compensation reserve
movement
Dividends
—
—
—
—
—
—
253
14
—
—
—
—
159
—
340
340
—
—
—
159
—
—
—
—
—
(261)
—
—
(801)
(261)
434
159
(801)
1 296
7 559
26 417
1 296
7 559
26 417
—
—
—
—
—
(76)
—
—
—
(914)
(76)
253
14
159
(914)
Balance at 31 March 2011
14
17 475
499
1 296
6 569
25 853
The accompanying notes are an integral part of these company annual financial statements.
136
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Company statement of cash flows
for the year ended 31 March 2011
Note
17
Cash flows from operating activities
Cash utilised in operations
Finance income
Dividends received
Taxation paid
Net cash from operating activities
Cash flows from investing activities
Preference dividends received
Net cash from investing activities
Cash flows from financing activities
Loans repaid by/(granted to) subsidiaries
Proceeds from share issue
Dividend paid
Net cash from/(utilised in) financing activities
Net increase/(decrease) in cash and cash
equivalents
Forex translation adjustments on cash and cash
equivalents
Cash and cash equivalents at beginning of
the year
Cash and cash equivalents at end of the year
31 March
31 March
2011
R’m
(50)
80
85
(21)
94
11
11
1 278
14
(905)
387
492
(2)
197
687
2010
R’m
(64)
150
—
(30)
56
20
20
(824)
7
(794)
(1 611)
(1 535)
(9)
1 741
197
The accompanying notes are an integral part of these company annual financial statements.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
137
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements
1.
PRINCIPAL ACCOUNTING POLICIES
The annual financial statements of the company are presented in accordance with, and comply with,
International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretations
Committee (IFRIC) interpretations issued and effective at the time of preparing these financial
statements and the South African Companies Act No 61 of 1973, as amended. The accounting
policies for the holding company are the same as those of the group, where applicable (refer to note 2
of the consolidated annual financial statements).
Investments in subsidiaries are accounted for in the company’s financial statements at cost less
impairment. Cost is adjusted to reflect changes in consideration arising from contingent consideration
amendments. Cost also includes directly attributable costs of investment.
2.
INVESTMENTS IN SUBSIDIARIES
The following information relates to Naspers Limited’s direct interest in its significant subsidiaries:
Name of
subsidiary
Func-
tional
cur-
rency
Effective
percentage
interest*
Direct invest-
ment in shares
Nature of
business
Country of
incorporation
2011
2010
%
%
2011
R’m
2010
R’m
UNLISTED COMPANIES
Media24 Holdings
(Proprietary)
Limited
Heemstede
Beleggings
(Proprietary)
Limited
MIH Holdings
Limited
Naspers Properties
(Proprietary)
Limited
Intelprop
(Proprietary)
Limited
ZAR
85,0
85,0
1
1 Investment holding
South Africa
ZAR 100,0
100,0
—
— Investment holding
South Africa
ZAR
100,0
100,0
5 452
5 452 Investment holding
South Africa
ZAR
100,0
100,0
—
— Properties holding
South Africa
ZAR 100,0
100,0
—
— Investment holding South Africa
* The effective percentage interest shown is the effective financial interest, after adjusting for the interests of any equity
compensation plans treated as treasury shares.
5 453
5 453
138
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
3.
LOANS TO SUBSIDIARIES
Media24 Limited
MIH Holdings Limited group
Naspers Properties (Proprietary) Limited
Intelprop (Proprietary) Limited
Less: Current portion
31 March
31 March
2011
R’m
945
17 932
317
51
19 245
(945)
18 300
2010
R’m
1 245
18 712
298
59
20 314
(1 245)
19 069
The loans to subsidiary companies do not have any fixed repayment terms except for the Media24
Limited loan, which is payable on demand. All the loans to subsidiary companies at 31 March 2011 are
interest free, except for R410m (2010: R750m) of the Media24 Limited loan account bearing interest at
a rate of prime less 3,5% (2010: prime less 3%) and R180m (2010: R198m) of the Naspers Properties
(Proprietary) Limited loan account bearing interest at a rate of prime (2010: prime less 0,75%).
For the year ended 31 March 2011 Naspers Limited subordinated R300m (2010: R300m) of the
R945m (2010: R1,2bn) loan to Media24, for the benefit of other current and future creditors of
Media24 Limited.
Office equipment
R’m
Total
31 March
2011
R’m
Total
31 March
2010
R’m
4. PROPERTY, PLANT AND
EQUIPMENT
Cost
Opening balance
Acquisitions
Closing balance
Accumulated depreciation
Opening balance
Depreciation
Closing balance
Cost
Accumulated depreciation
Net book value
2
1
3
—
(1)
(1)
3
(1)
2
2
1
3
—
(1)
(1)
3
(1)
2
2
—
2
—
—
—
2
—
2
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
139
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
5.
INVESTMENTS AND LOANS
Loans and receivables
Welkom Yizani preference shares
Less: Short-term accrued dividends on preference shares
Long-term portion of loans and receivables
31 March
31 March
2011
R’m
404
(11)
393
2010
R’m
392
(20)
372
The Welkom Yizani BEE transaction was refinanced during the year ended 31 March 2010. Welkom
Yizani redeemed 21,1 million preference shares at a nominal value and the company waived R119m
of accumulated preference dividends as part of the transaction. The total refinancing charge of R330m
is included in (cid:2130)Other gains/(losses) – net” in the statement of comprehensive income. Preference
dividends are calculated at a rate of 65% (2010: 65%) of the prime interest rate. See note 7 in the
consolidated annual financial statements for further details concerning this investment.
6.
RELATED PARTY TRANSACTIONS AND BALANCES
Loans and interest
For details on related party loans, interest and dividends received refer to notes 3, 13 and 15.
Directors’ emoluments
Executive directors
Remuneration for other services paid by subsidiary
companies
Non-executive directors
Fees for services as directors
Fees for services as directors of subsidiary companies
31 March
31 March
2011
R’000
2010
R’000
6 154
7 649
5 241
19 044
6 235
6 409
5 247
17 891
Refer to note 13 of the consolidated annual financial statements for disclosure on executive director
remuneration.
140
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
7. DEFERRED TAXATION
The company created a deferred taxation asset of R110m (2010: R96m) on unutilised secondary tax
on companies (STC) credits. The unutilised STC credits amounted to R1,4bn on 31 March 2011
(2010: R2,4bn). Management recorded a valuation allowance of R1,1bn (2010: R1,4bn) against the
unutilised STC credits on 31 March 2011 due to uncertainty regarding the full utilisation of these
credits. See note 16 of the consolidated annual financial statements for management’s assumptions,
which are based on changes relating to STC legislation.
Deferred taxation balances
Provisions and other current
liabilities
STC credits
Prepaid expenses
Charged to
1 April comprehen-
2009 sive income
R’m
R’m
Charged to
1 April comprehen- 31 March
2011
2010 sive income
R’m
R’m
R’m
2
81
—
83
1
15
(1)
15
3
96
(1)
98
1
14
—
4
110
(1)
15
113
31 March
2011
R’m
31 March
2010
R’m
8. OTHER RECEIVABLES
Accrued Welkom Yizani preference dividends
Other receivables
9.
SHARE CAPITAL AND PREMIUM
Authorised
1 250 000 A ordinary shares of R20 each
500 000 000 N ordinary shares of 2 cents each
Issued
712 131 A ordinary shares of R20 each
406 581 911 N ordinary shares of 2 cents each
(2010: 405 885 411)
Share premium
Less: 17 237 404 N ordinary shares held as treasury shares
(2010: 17 423 134 N ordinary shares)
11
1
12
25
10
35
14
8
22
19 271
19 293
(1 804)
17 489
20
8
28
25
10
35
14
8
22
19 018
19 040
(1 818)
17 222
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
141
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
9.
SHARE CAPITAL AND PREMIUM (continued)
31 March
2011
Number of
N shares
31 March
2010
Number of
N shares
Movement in N ordinary shares in issue during the year
Shares in issue at 1 April
Shares issued to share incentive trusts
405 885 411
404 305 411
696 500
1 580 000
Shares in issue at 31 March
406 581 911
405 885 411
Movement in N ordinary shares held as treasury
shares during the year
Shares held as treasury shares at 1 April
17 423 134
17 570 915
Shares issued to the Naspers equity compensation plan
5 000
28 000
Shares acquired by participants from the Naspers equity
compensation plan
(190 730)
(175 781)
Shares held as treasury shares at 31 March
17 237 404
17 423 134
Voting and dividend rights
The A ordinary shareholders are entitled to 1 000 votes per share and shall be entitled to nominal
dividends as determined from time to time by the board of directors, but always limited to one-fifth
of the dividend to which N ordinary shareholders are entitled. The A ordinary shareholders do not
have a right to receive a dividend when dividends are declared to N ordinary shareholders, although a
dividend to A ordinary shareholders could be proposed by the board. In respect of all other rights, the
A ordinary shares rank pari passu with the N ordinary shares of the company.
Share premium
Opening balance at 1 April
Share premium on share issues
Balance at 31 March
31 March
31 March
2011
R’m
19 018
253
19 271
2010
R’m
18 585
433
19 018
Capital management, unissued shares and valuation reserve
See notes 14 and 15 of the consolidated annual financial statements for the group’s capital
management policy, authorisation for unissued shares and more details regarding the nature of the
valuation reserve.
142
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
10. POST-RETIREMENT MEDICAL LIABILITY
The company operates a post-retirement medical benefit scheme. The obligation of the company to
pay medical aid contributions after retirement is no longer part of the conditions of employment for new
employees. A number of pensioners, however, remain entitled to this benefit. The company provides
for post-retirement medical aid benefits on the accrual basis determined each year by an independent
actuary. The directors are confident that adequate provision has been made for future liabilities.
Balance at 1 April
Provisions charged to statement of comprehensive income
Balance at 31 March
31 March
31 March
2011
R’m
3
—
3
2010
R’m
2
1
3
Refer to note 17 of the consolidated financial statements for additional information including the
actuarial assumptions.
11. AMOUNTS OWING IN RESPECT OF INVESTMENTS ACQUIRED
On 24 March 2004 the last conditions precedent relating to schemes of arrangement under section
311 of the South African Companies Act, 1973, were satisfied, in terms of which Naspers Limited
acquired an additional 19,62% financial interest in Electronic Media Network Limited and SuperSport
International Holdings Limited respectively (which was sold to MultiChoice Africa (Proprietary) Limited
during 2005). An amount of R816m was due to the non-controlling shareholders on 31 March 2004.
Some of these non-controlling shareholders have not surrendered their share certificates and claimed
payment for their shares, therefore an amount of R13m was still outstanding as at 31 March 2011
(2010: R14m).
12. ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES
Accrued expenses
Bonus accrual
Other current liabilities
31 March
31 March
2011
R’m
8
6
2
16
2010
R’m
12
4
8
24
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
143
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
13. OTHER GAINS/(LOSSES) – NET
Subsidiaries
Dividends – unlisted shares
Welkom Yizani refinancing
Total other gains/(losses) – net
31 March
31 March
2011
R’m
85
—
85
2010
R’m
140
(330)
(190)
Refer to note 5 for information on the refinancing of the Welkom Yizani black economic empowerment
scheme.
31 March
31 March
2011
R’m
2010
R’m
14. EXPENSES BY NATURE
Operating profit includes the following items:
Staff costs
As at 31 March 2011 the company had 30 (2010: 21) permanent employees.
The total cost of employment of all employees was as follows:
Salaries, wages, bonuses, retirement benefit costs, medical
aid fund contributions, post-retirement benefits and training
costs
Share-based compensation charges
Total staff costs
Fees paid to non-employees for administration,
management and technical services
Auditor’s remuneration
Audit fees
All other fees
22
159
181
77
4
—
4
15
159
174
67
3
3
6
144
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
31 March
31 March
2011
R’m
2010
R’m
15. FINANCE INCOME/(COSTS) – NET
Interest paid
Other
Interest received
Loans and bank accounts
Subsidiaries
Other finance income/(costs) — net
Net (loss)/gain from foreign exchange translation of
assets
Preference dividends (BEE structures)
Finance income/(costs) – net
16. TAXATION
Normal taxation
South Africa
– Current year
– Prior year underprovision
Income taxation for the year
Deferred taxation
– Current year
– Prior year
Total tax per statement of comprehensive income
Reconciliation of taxation
Taxation at statutory rates
Adjusted for:
Non-deductible expenses
Non-taxable income
Prior year adjustments
Other taxes
Taxation provided in statement of comprehensive
income
(2)
(2)
36
56
92
(2)
23
21
111
19
6
25
(15)
(15)
—
10
(18)
67
(31)
6
(14)
10
—
—
91
69
160
(9)
47
38
198
36
—
36
(14)
(11)
(3)
22
(67)
156
(53)
(3)
(11)
22
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
145
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
17. CASH UTILISED IN OPERATIONS
Loss before tax per statement of comprehensive income
Adjustments:
– Non-cash and other
Welkom Yizani refinancing
Expenses paid by subsidiary
Finance (income )/costs – net
Investment income
Share-based compensation charges
Other
– Working capital
Cash movement in trade and other receivables
Cash movement in payables, provisions and accruals
Cash utilised in operations
18. CASH AND CASH EQUIVALENTS
Cash at bank and on hand
Short-term bank deposits
31 March
31 March
2011
R’m
(66)
16
—
47
(111)
(85)
159
6
—
1
(1)
(50)
85
602
687
2010
R’m
(239)
188
330
37
(199)
(140)
159
1
(13)
(8)
(5)
(64)
197
—
197
146
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
19. FINANCIAL RISK MANAGEMENT
Foreign exchange risk
See note 38 of the consolidated financial statements for the group’s risks.
Foreign currency sensitivity analysis
The company’s presentation currency is the South African rand, but as it operates internationally, it is
exposed to the US dollar and the euro.
The sensitivity analysis below details the company’s sensitivity to a 10% decrease (2010: 10% decrease)
in the rand against the US dollar and the euro. These percentage decreases represent management’s
assessment of the possible changes in the foreign exchange rates at the respective year-ends. The
sensitivity analysis includes only outstanding foreign currency denominated monetary items and adjusts
their translation at the period-end for the above percentage change in foreign currency rates.
A 10% decrease (2010: 10% decrease) of the rand against the US dollar and the euro would result in
a profit after tax of R2,5m (2010: R2m profit after tax).
Credit risk
Refer to note 38 of the consolidated financial statements for the group’s credit risks.
The maximum amount of credit risk related to financial assets that the company is exposed to, is
R20,3bn (2010: R20,9bn), and has been calculated as follows:
Loans to subsidiaries
Investments and loans
Other receivables
Cash and cash equivalents
31 March
31 March
2011
R’m
19 245
393
11
687
20 336
2010
R’m
20 314
372
20
197
20 903
The company has guaranteed revolving credit facilities of R13,5bn (2010: R12,3bn) and an offshore
bond of R4,7bn (2010: Rnil) in MIH B.V. of which the undrawn balance is available to fund future
investments. The guarantees have also been disclosed as part of the company’s liquidity risk below.
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
147
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
19. FINANCIAL RISK MANAGEMENT (continued)
Liquidity risk
Refer to note 38 of the consolidated financial statements for the group’s liquidity risks. In terms of the
articles of association of the company, no limitation is placed on its borrowing capacity.
The following analysis details the company’s remaining contractual maturity for its non-derivative
financial liabilities. The analysis is based on the undiscounted cash flows of financial liabilities based on
the earliest date at which the company can be required to pay. The analysis includes both interest and
principal cash flows.
31 March 2011
Non-derivative financial liabilities
– Amounts owing in respect of
investments acquired
– Accrued expenses and other current
liabilities
– Dividends payable
– Financial guarantees
31 March 2010
Non-derivative financial liabilities
– Amounts owing in respect of
investments acquired
– Accrued expenses and other
current liabilities
– Financial guarantees
Carrying
amount
R’m
Contractual
cash
flows
R’m
0 – 12
months
R’m
13
16
8
13
16
8
18 279
18 279
14
19
14
19
12 277
12 277
13
16
8
—
14
19
—
Interest rate risk
See note 38 of the consolidated financial statements for the group policy.
148
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
STATUTORY
REPORTS
REPORTS
CONSOLIDATED
CONSOLIDATED ANNUAL
FINANCIAL
FINANCIAL STATEMENTS
STATEMENTS
COMPANY FINANCIAL
COMPANY ANNUAL
STATEMENTS
FINANCIAL STATEMENTS
CORPORATE
CORPORATE
INFORMATION
INFORMATION
Notes to the company annual financial statements (continued)
19. FINANCIAL RISK MANAGEMENT (continued)
Interest rate sensitivity analysis
The sensitivity analysis below has been determined based on the exposure to interest rates for both
derivative and non-derivative instruments at the statement of financial position date and the stipulated
change taking place at the beginning of the next financial year and held constant throughout the
reporting period in the case of instruments that have floating rates. The company is mainly exposed
to interest rate fluctuations of the South African, American and European repo rates. The following
changes in the repo rates represent management’s assessment of the possible change in interest rates
at the respective year-ends:
(cid:96) South African repo rate: increases by 100 basis points (2010: increases by 100 basis points)
(cid:96) American, European and London Interbank Rates: increases by 100 basis points each (2010:
increases by 100 basis points each).
If interest rates change as stipulated above and all other variables were held constant, specifically
foreign exchange rates, the company’s profit after tax for the year ended 31 March 2011 would
increase by R12m (2010: increase by R11m).
20. FAIR VALUE OF FINANCIAL INSTRUMENTS
The fair values together with the carrying values, net gains and losses recognised in profit and loss, total
interest income, total interest expense and impairment of each class of financial instrument are as follows:
31 March 2011
Assets
Loans to subsidiaries
Investments and loans
Other receivables
Cash and cash equivalents
Total
Liabilities
Amounts owing in respect of
investments acquired
Accrued expenses and other
current liabilities
Dividends payable
Total
Carrying
value
R’m
Fair
value
R’m
Net losses
recognised
in profit
and loss
R’m
Total
interest
income
R’m
19 245
393
11
687
19 245
393
11
687
20 336
20 336
13
16
8
37
13
16
8
37
—
—
—
(2)
(2)
—
—
—
—
56
23
—
36
115
—
—
—
—
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
149
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Notes to the company annual financial statements (continued)
20. FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)
31 March 2010
Assets
Loans to subsidiaries
Investments and loans
Other receivables
Cash and cash equivalents
Total
Liabilities
Amounts owing in respect of
investments acquired
Accrued expenses and other
current liabilities
Total
Carrying
value
R’m
Fair
value
R’m
Net losses
recognised
in profit
and loss Refinancing
R’m
R’m
Total
interest
income
R’m
20 314
372
20
197
20 314
372
20
197
20 903
20 903
14
19
33
14
19
33
—
—
—
(9)
(9)
—
—
—
—
(330)
—
—
(330)
—
—
—
69
47
—
92
208
—
—
—
Refer to note 39 of the consolidated financial statements for details regarding the calculation of the fair
values of financial instruments.
21. EQUITY COMPENSATION BENEFITS
Please refer to note 40 of the consolidated financial statements for details regarding the Naspers
Limited share incentive plan.
150
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Administration and corporate information
GROUP SECRETARY
ADR PROGRAMME
G Kisbey-Green
251 Oak Avenue
Randburg 2194
South Africa
REGISTERED OFFICE
40 Heerengracht
Cape Town 8001
South Africa
PO Box 2271
Cape Town 8000
South Africa
Tel: +27 (0)21 406 2121
Fax: +27 (0)21 406 3753
REGISTRATION NUMBER
1925/001431/06
Incorporated in South Africa
AUDITOR
PricewaterhouseCoopers Inc.
TRANSFER SECRETARIES
Link Market Services South Africa
(Proprietary) Limited
(Registration number: 2000/007239/07)
PO Box 4844, Johannesburg 2000
South Africa
Tel: +27 (0)11 630 0800
Fax: +27 (0)11 834 4398
The Bank of New York Mellon maintains
a Global BuyDIRECT™ plan for Naspers Limited.
For additional information, please visit
The Bank of New York Mellon’s website at
www.globalbuydirect.com
or call Shareholder Relations at
1-888-BNY-ADRS
or 1-800-345-1612 or write to:
The Bank of New York Mellon
Shareholder Relations Department –
Global BuyDIRECT™
Church Street Station
PO Box 11258, New York, NY 10286-1258, USA
SPONSOR
Investec Bank Limited
(Registration number: 1969/004763/06)
PO Box 785700, Sandton 2146
South Africa
Tel: +27 (0)11 286 7326
Fax: +27 (0)11 286 9986
ATTORNEYS
Werksmans incorporating Jan S de Villiers
PO Box 1474, Cape Town 8000
South Africa
INVESTOR RELATIONS
M Horn
meloy.horn@naspers.com
Tel: +27 (0)11 289 3320
Fax: +27 (0)11 289 3026
www.naspers.com
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
151
STATUTORY
REPORTS
CONSOLIDATED ANNUAL
FINANCIAL STATEMENTS
COMPANY ANNUAL
FINANCIAL STATEMENTS
CORPORATE
INFORMATION
Analysis of shareholders and shareholders’ diary
ANALYSIS OF SHAREHOLDERS
Size of holdings
1 – 100 shares
101 – 1 000 shares
1 001 – 5 000 shares
5 001 – 10 000 shares
More than 10 000 shares
Number of
Number of
shareholders
shares owned
19 460
19 035
3 630
547
1 156
732 907
6 882 891
7 795 757
4 006 261
387 164 095
The following shareholders hold 5% and more of the issued share capital of the company:
Name
Public Investment Corporation
Dodge & Cox Incorporated
Capital World Investors
Coronation Fund Managers (Proprietary) Limited
Number of
shares owned
41 404 675
29 795 695
27 761 600
21 126 278
Public shareholder spread
To the best knowledge of the directors, the spread of public shareholders in terms of section 4.25 of the
JSE Limited’s Listings Requirements at 31 March 2011 was 92,19%, represented by 43 809 shareholders
holding 374 810 522 ordinary shares in the company. The non-public shareholders of the company
comprising 19 shareholders representing 31 771 389 ordinary shares are analysed as follows:
Category
Naspers Share Trust
Directors
Group companies
SHAREHOLDERS’ DIARY
Annual general meeting
Reports
Interim for half-year to September
Announcement of annual results
Annual financial statements
Dividend
Declaration
Payment
Financial year-end
152
NASPERS ANNUAL FINANCIAL STATEMENTS 2011
Number of
% of issued
shares
share capital
17 377 456
9 684 662
4 709 271
4,3
2,4
1,2
August
November
27 June
July
August
September
March
BASTION GRAPHICS
w
www.naspers.com