ANNUAL
REPORT
2022
1
Annual Report 2022Zambeef Products PLC 2
Annual Report 2022Zambeef Products PLC CONTENTS
Overview
Zambeef at a Glance
History and Key Milestones
Strategies report
Chairman’s Report
Chief Executive Officer’s Report
Sustainability Report
Corporate Governance
Board reports
Board of Directors
Director’s Report
Statement of Directors’ Responsibilities
Independent Auditor’s Report
Financial Statements 30 September 2022
Statement of profit or loss and other comprehensive income
Consolidated Statement of Financial Position
Company Statement of Financial Position
Consolidated Statement of Changes in Equity
Company Statement of Changes in Equity
Statement of Cash Flows
Notes to the Financial Statements
Supplementary Information - presented in USD (unaudited)
Notice of AGM
Proxy form
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6
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10
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17
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26
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30
36
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114
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Annual Report 2022Zambeef Products PLC Zambeef at a Glance
Zambeef Products PLC (“Zambeef”) is the largest integrated cold
chain food products and agribusiness company in Zambia and one
of the largest in the Southern Africa region. Zambeef is quoted on
both the Lusaka Securities Exchange and the AIM market of the
London Stock Exchange.
It is involved in the primary production, processing, distribution and
retailing of beef, chicken, pork, dairy, fish, flour, stockfeed and day-old
chicks throughout Zambia and the surrounding region. It has further
retail operations in Nigeria and Ghana.
Zambeef also has one of the largest row cropping operations in
Zambia, growing wheat, soya beans and maize. Zambeef plants
nearly 20,987 hectares annually, with most of the resulting crops
being used in the Zambeef animal feed and flour milling businesses.
Our Purpose
To be the food provider of choice through accessible, affordable
and reliable supply. We aspire to be the most sustainable social,
environmental and financially viable business in the diversified foods
industry within Zambia and the region.
Our Business Model
Our vertically integrated business model provides strong
foundations for growth and:
§ Underpins margin capture and value add;
§ Secures supply chain;
§ Reduces risk and earnings volatility
BUSINESS SEGMENTS
Retailing and Food Production
Zambeef’s products are retailed through 223 outlets (2021: 207)
directly to end-consumers, in a value-added form, either through
the Zambeef concession agreement to operate Shoprite’s in-store
butcheries (41 in 2022; 41 in 2021) or through Zambeef’s own retail
and wholesale distribution network in Zambia (182 in 2022; 165 in
2021).
Zambeef operates inhouse bucheries in West Africa - Nigeria and
Ghana.
Zambeef also operates one of the largest transport and trucking
fleets in Zambia (252 trucks), giving Zambeef control over its logistics
and distribution.
4
Annual Report 2022Zambeef Products PLC Zambeef at a Glance (continued)
• The largest processor of beef in Zambia.
•
Five active beef abattoirs (capacity to slaughter 230,000
head p.a.) and five feedlots located across Zambia (standing
capacity 16,000 head).
• Meat processing plant with a capacity to process over
100,000 cattle p.a.
• One of the largest chicken processors, producing fresh and
frozen products (capacity 9.4m broilers p.a.). The Group’s
breeding and hatchery operations also supply large quantities
of day-old broiler chicks (capacity 25m p.a.) to small- and
medium-scale poultry producers.
• One of the largest pork processing plants in Zambia,
producing bacon, pork sausages and other meat
products. (capacity to slaughter 102,000 heads p.a.)
• Dairy farm with approximately 3,410 cows and a dairy
parlour milking capacity of 2,000 cows per day.
• Dairy processing plant (capacity 120,000 litres/day) to
process milk, lacto and a wide range of value-added products
including yoghurt, drinking yoghurt, cheese, butter and milk-
based juices.
Cropping and Milling
•
The leading stockfeed producer in Zambia, operating two feed
mills, in Lusaka and Mpongwe, with a capacity of 300,000
tonnes p.a.
• Novatek is the only stockfeed producer in Zambia with ISO
22,000 Food Safety Management certification.
• Novatek supplies feed to Zambeef livestock farming operations
and also supplies 168 branded shops owned by external agents
(2021: 157) in addition to Zambeef retail outlets.
• One of the largest row cropping operations in Zambia.
•
In winter Zambeef plants 6191Ha and a total 14,848ha is
planted in Summer. Due to double cropping of irrigated land
the total area planted annually is 21,039 ha.
• Crop production focuses on soyabeans and maize during
summer and wheat during winter.
• Wheat mill with a capacity to mill 25,000 MT of wheat p.a.
•
•
The largest tannery in Zambia, with a processing capacity of
144,000 hides p.a.
The largest shoe manufacturing plant in Zambia, with a
production capacity of 153,000 pairs p.a.
• One bakery with the capacity to bake 1.2 million loaves of
bread p.a.
5
Annual Report 2022Zambeef Products PLC History & Key Milestone
1994
Zambeef Products Ltd.
incorporated with 60
staff, a rented abattoir &
2 butcheries, delivering
180 beef cattle per
month in 3 land rovers
1996
Acquired Huntley
Farm (abattoir
and feedlot)
2004
Acquired
Sinazongwe
Farm, Shoprite
expansion into
Nigeria & Ghana
2008
First equity capital
raise (Acquired
Masterpork, Chiawa
Farm, Amanita
Soya crushing and
refining plant)
2011
Listed on the
London Stock
exchange (AIM).
Acquired Mpongwe
Farms
2017
Commissioning of
US$30million hatchery and
stockfeed mill at Mpongwe
Farm
2020
Disposal of
Sinazongwe Farm
for US$10million
12
13
14
15
16
2016
BII formerly known as CDC Group
PLC acquires 38% Zambeef
equity for US$65million. Put
option settled to RCL Foods
for full interests in Zamchick &
Zamhatch
2018
IDC Zambia
acquires 90% of
Zampalm ltd for
US$16million
2022
USD$100 million
major expansion
plan
1
3
5
7
9
2
4
6
8
10
11
1995
Secured concession
to operate the
butcheries in all
Shoprite stores in
Zambia
2003
Listed on Lusaka
Stock Exchange.
2005
Sinazongwe
Abattoir built
2009
Zampalm and
Novatek Animal
Feeds established
2013
Entered into joint
venture with
Rainbow Chickens
on Zamchick &
Zamhatch
2015
Disposal of
Zamanita Ltd
to Cargill for
US$26million
6
Annual Report 2022Zambeef Products PLC Feeding a growing region
Ghana
Shoprites
Total Ghana
2022
2021
7
7
7
7
Nigeria
Shoprites
Master Meats Outlets
Total Nigeria
2022
2021
25
0
25
25
0
25
Zambia
Zambeef Outlets
Zambeef Macros
Novatek
Bakery
Zamshu Outlets
Total Zambeef Outlets
Shoprites
Total Zambia
Total Zambeef
Total Shoprites
Total Retail Network
2022
2021
60
50
36
1
35
182
41
223
63
41
30
1
31
166
41
207
2022
2021
182
73
255
166
72
238
Zambeef Operations
Current Export Market
7
Annual Report 2022Zambeef Products PLC CHAIRMAN’S REPORT
disruptions on international trade, added
layers of production complexities to the
business as lead times for imported
goods
increased. Commodity prices,
particularly crude oil, fertilisers and
grain, escalated as a result of the Russia
- Ukraine conflict. In addition, the period
saw the outbreak of animal diseases
such as, the African Swine Fever and
Contagious Bovine Pleuropneumonia
(CBPP) which respectively impacted our
pork and beef businesses.
Despite the headwinds, management
worked tirelessly to keep the business
performing by focusing on enhanced
bio-security
risk, cost management,
revenue maximisation and market share
growth. As a result, the business posted
positive financial results and is well-
positioned on the path to actualising its
short to medium-term strategy.
The Group’s performance demonstrates
its ability to remain resilient in the
evolving market and
the
strengths of
integrated
business model, which is key to creating
sustainable long-term shareholder value.
its vertically
illustrates
Strategy
The Group’s medium-term strategy is
centred around optimising existing
assets and investing in capacity for
the future. It is with this in mind that
the Group announced a US$100 million
expansion programme during the year.
This investment strategy is expected to
increase the Groups various value chain
capacities, and deliver developmental
impact to the Zambian economy through
increased tax revenue
job creation,
and supporting ancillary businesses
such as small-scale farmers and small
to medium-sized businesses. The
expansion is expected to double the
Mpongwe Farm row cropping capacity,
and also to deliver significantly improved
production efficiency and capacity
through the downstream food value
chains. The first crop from the expanded
cropping operations
is expected to
be planted in the 2023/2024 financial
with capacity upgrades to milling and
processing facilities being run in parallel.
As part of the $100m expansion plan,
we remain committed to maintaining a
responsible business by building on the
Environmental, Social and Governance
(ESG) agenda. Therefore, the investment
will see an improvement in the Group’s
carbon footprint and livestock health
and welfare.
Dear Shareholder,
I have the pleasure of presenting my
report to you for the financial year ending
30th September 2022.
The financial year saw an improvement
in economic sentiment following the
successful holding of
the general
election in August 2021 and the peaceful
transition of government. The Kwacha
appreciated significantly and remained
stable during the period. However, global
economic headwinds contributed to
the disruption of an otherwise positive
trajectory for Zambia’s macroeconomic
environment. The spill-over effects of
the Covid-19 pandemic related supply
The Group’s performance
demonstrates its ability to
remain resilient in the evolving
market and illustrates the
strengths of its vertically
integrated business model...
8
As part of the divesture of non-core and
low-returning assets, the Group exited
from pig farming, pullet rearing and egg
production during the year. Chiawa farm
remains an asset held for sale. These
divestitures will enable the business to
focus on becoming best in class and
improve the Group’s profitability.
The Board remains committed to
achieving the Group’s strategic priorities
while navigating the seasonal market
and economic challenges. The following
are the pillars on which the five-year
strategy is underpinned:
•
•
•
•
•
Focus and strengthen our core
business by investing in capacity
and growing market share
Divestiture of non-core assets to
free up resources
Develop a human capital strategy
that aligns with business objectives
Strengthen
partnerships
Enhancement
value
our
strategic
of
shareholders’
The Economic Environment
Despite the year 2022 being the second
year since the outbreak of Covid-19, its
impact on the economy compared to the
prior year reduced tremendously due to
the success of governments vaccination
campaigns and the public’s adherence
to public health measures.
The economy rallied in comparison to
the corresponding period under review
and saw stability in macroeconomic
fundamentals. The ZMW/USD exchange
rate averaged 17.18 down by 19%
compared to 21.12 averaged in the
previous corresponding period. The local
currency has seen a steady appreciation
since the start of the financial year
despite moments of
volatility. A
tight monetary policy which saw the
Monetary Policy Rate remain stable at
9%, relatively high copper prices and
market confidence arising from the
peaceful transition of power have been
key in keeping the currency stable.
Inflation reduced significantly during
the period under review, closing at 9.9%
compared to 22.1%
in the previous
year. This drop came as a result of
currency appreciation and a reduction
in food inflation despite the escalation
in diesel and petrol pump prices.
Customers disposable income remained
Annual Report 2022Zambeef Products PLC CHAIRMAN’S REPORT (continued)
under stress as the effect of stable
macroeconomic fundamentals had not
yet fully trickled down to the consumers.
Inflation for the period under review
averaged 13.4% compared to 21.7% for
the previous corresponding period.
Outlook
We anticipate macro-economic stability
to continue, supported by
improved
investor sentiment leading to increased
foreign direct investment. The Kwacha is
also expected to remain stable across the
2023 financial year. The copper prices,
which is a major foreign exchange earner
for the country, is expected to stabilise at
current levels as the worst effects of the
manufacturing slowdown have tapered
off. The inflation rate is expected to
remain stable, although the outcome of
the Russia - Ukrainian tensions could
lead to further rises in global food and
energy prices which still pose a risk of
higher inflation locally. Of key concern
is the emergence of escalating cost of
funding as foreign currency
liquidity
migrates to the United States of America
and the United Kingdom, where interest
rates are rising.
Executive Management Changes
I am pleased to advise that on 1 July
2022, Ms Faith Mukutu was appointed
Chief Executive Officer. She succeeded
Mr Walter Roodt who served as Chief
Executive Officer since January 2020.
Mr Roodt will continue full-time with the
company focussing on Large livestock
and Strategic Projects in an executive
capacity
the expansion
programme referred to above. To ensure
a smooth transition, Walter remains on
the Board until 1st December, 2022.
to support
The appointment of Faith represents the
confidence the Board has in her ability to
lead the business through the new phase.
Since joining the Group in September
2019, as the Chief Financial Officer,
Faith has been instrumental in driving
the realisation of commercial value from
our business having introduced a cost
control culture, restructuring the group
balance sheet and streamlining finance
operations and reporting.
I am delighted that at the date of this
report, the Board had announced the
appointment of M’boo John Mumba as
Chief Financial Officer, Mboo has also
been appointed as an Executive Director
of the Board.
M’boo takes on the role, following the
promotion of Faith Mukutu, to Chief
Executive Officer (CEO) on 1 July
2022. He joined the Zambeef Group in
May 2020 as Project Manager before
he took up the role of Group Head of
Treasury and Administration. He has
brought to the Company skills which
combine industry, financial and banking
experience of more than 16 years. His
established professional background
and valuable expertise is an asset to the
Group.
Acknowledgement
On behalf of the Company and the
Board, I would like to express my sincere
gratitude to Messrs; Yollard Kachinda
and Frank Braeken who resigned from
the board on 14 April 2022 and 27 May
2022, respectively. Their dedication and
contributions to the business during the
period they served as Directors will be
greatly missed. I am also indebted to
Walter Roodt who, after his reassignment
to a new role remained on the Board for
a smooth transition. He has played a
significant role in the Group and we all
wish him all the very best in his new role.
I also thank my fellow board members
for steering the Group through the year
and positioning it for the next phase of
growth. To our management and staff,
I express my gratitude for another solid
performance, dedicated efforts, and
resilience in the face of challenges. I am
proud of our achievements to date and I
am excited by the potential opportunities
upon which we will build our future
progress.
Michael M Mundashi
Chairman
9
Annual Report 2022Zambeef Products PLC
CHIEF EXECUTIVE OFFICER’S REPORT
largely by reduced consumer spending
and
input
increased production and
the stabilisation of
costs, despite
environment.
the macroeconomic
headwinds,
the
Notwithstanding
exceeded
the
results
particularly
market
the outstanding performance
in the
Cropping and Milling division.
expectations,
Group’s
Pressure on volumes and margins
in the Retail and Cold Chain Food
Products (CCFP) division on the back of
reduced consumer spending negatively
impacted performance, particularly in
the first half of the year. An increase in
raw material input costs, such as soya
beans, precipitated a rise in feed prices,
in
which affected production costs
our livestock business. In addition, the
outbreak of African Swine Fever, over six
weeks in Lusaka and in other parts of
the country, affected the pork business
negatively. Further, the outbreak of
Contagious Bovine Pleuropneumonia
(CBPP), a disease affecting cattle
negatively affected our Beef business;
with a cost to Company of K20.7 million.
in volumes
The second half of the year saw volume
recovery
the Retail
and CCFP segments driven by price
moderation. This coupled with cost
control, enabled a recovery from the
subdued first-half year performance.
in
Despite the challenges noted above, the
Group posted strong results during the
year in line with expectations mainly due
to buoyed performance in our Cropping
and Milling division.
The Group delivered a profit before
tax of ZMW55 million (USD3 million),
representing a decline of 68% in Kwacha
(61% in US dollar terms), compared to
ZMW172 million (USD8 million) in the
prior year. The above results posted
are after the recognition of goodwill
impairment amounting
to ZMW142
million (USD8.3m) on the fair value of
Zamchick Limited assets. Adjusting for
this non-cash impairment, the Group
delivered a profit before tax of ZMW197
million (USD11.5 million) representing a
growth of 15%.
The Group generated revenue of ZMW5.4
billion (USD314 million) and achieved a
gross profit of ZMW1.6 billion (USD95
million), representing 8% and 11% above
the prior year in kwacha terms, and up by
33% and 37% in US dollars, respectively.
Our diversified and vertically integrated
brands,
business
strong
with
supportive partners and an experienced
management
team helped deliver
encouraging results.
Strategic focus
Our strategic focus
is to optimise
existing assets and invest in the future.
We remain committed to our strategy
of focussing on our core businesses, in
which we strive to be the best in class.
The continued divestiture of non-core
assets enables us to free up cash to
invest in core businesses and therefore,
deliver shareholder value. As part of
delivering on our strategic imperatives
and as announced during the financial
year under review, our $100M expansion
strategy will see increased profitability in
the medium to long term, thus delivering
increased value to our shareholders and
positively impacting the communities in
which we operate. As of 30th September
2022, a total of $7.3m out the $100m
expansion plan was either spent or
committed by the business.
Outlook
Our strong brands will help us maintain
customer
loyalty while the vertically
integrated business model positions us
well to secure both supply and a market
for our products. The anticipated future
recovery in the economy and a strong
management team have positioned us
well for shareholder value maximisation
in the coming years. The Group will
capitalise on the positive economic
outlook and invest for the future in
anticipation of
improved consumer
spending.
The Russia-Ukraine conflict poses
risks but at the same time presents
opportunities for our business. The
consequent rise in input costs such as
fertiliser and energy could negatively
impact our profitability while the rise
in commodity prices, such as wheat
and soya, will benefit our Cropping and
Milling division. Higher soya and maize
prices would translate into higher stock
feed costs which would negatively
impact the profitability of our Retail and
Cold Chain Food products business.
Consolidating our balance sheet through
disposals of low-returning assets and
expanding capacity remains a key focus
to enhance shareholder value. In the
coming years, the Group is set to make
significant strides in our US$100 million
expansion program with the Cropping
and Milling segment set for expansion in
the 2022/2023 financial year.
Overview
It is my pleasure to give my inaugural
report as Chief Executive Officer, to you,
our esteemed shareholders. I wish to
thank the Board for their confidence in my
abilities to lead your Company through
the next exciting phase of our growth
strategy. I also wish to thank Mr Walter
Roodt, my predecessor, for steering the
Group through the challenging times of
the last two years.
Without a doubt, this was another
challenging year characterised by a
trading environment driven
difficult
The Group generated revenue
of ZMW5.4 billion (USD314
million) and achieved a gross
profit of ZMW1.6 billion
(USD95 million), representing
8% and 11% above the prior
year in kwacha terms, and up
by 33% and 37% in US dollars,
respectively.
10
Annual Report 2022Zambeef Products PLC CHIEF EXECUTIVE OFFICER’S REVIEW (continued)
Divisional Performance
Table 1 (ZMW) and Table 2 (USD) below provide a summary of the consolidated performance of the key business divisions
reported at an operating profit level.
Table 1: Divisional financial summary in ZMW'000
Sep-22
Division
Retailing and Food
Production
Cropping and Stock
Feed
Revenue
2022
Revenue
2021
Gross
Profit
2022
Gross
Profit Overheads Overheads
2021
2022
2021
Operating
Profit
2022
Operating
Profit
2021
ZMW’000
ZMW’000 ZMW’000
ZMW’000
ZMW’000
ZMW’000 ZMW’000 ZMW’000
3,138,305
3,254,929
716,420
827,447
(628,683)
(611,027)
87,737
216,420
3,369,186
2,845,518
916,766
643,269
(467,870)
(378,546)
452,936
264,723
Total
6,507,491
6,100,447 1,633,186
1,470,716
(1,096,553)
(989,573)
540,673
481,143
Less: Intra/ Inter Group
Sales
Central Overhead
(1,112,730)
(1,126,096)
(362,969)
(234,744)
(362,969)
(234,744)
Group Total
5,394,761 4,974,351 1,633,186 1,470,716
(1,459,522)
(1,224,317)
173,664
246,399
Table 2: Divisional financial summary in USD'000
Revenue
2022
Revenue
2021
Gross
Profit
2022
Gross
Profit Overheads Overheads
2021
2022
2021
Operating
Profit
2022
Operating
Profit
2021
Division
USD’000
USD’000
USD’000
USD’000
USD’000
USD’000
USD’000
USD’000
Retailing Zambia
182,672
154,116
41,701
39,178
(36,594)
(28,931)
5,107
10,247
Cropping and Milling
196,111
134,731
53,362
30,458
(27,233)
(17,924)
26,129
12,534
Total
378,783
288,847
95,063
69,636
(63,827)
(46,855)
31,236
22,781
Less: Intra/ Inter Group
Sales
Central Overhead
(64,769)
(53,319)
-
-
(21,127)
-
(11,115)
-
(21,127)
(11,115)
Group Total
314,014
235,528
95,063
69,636
(84,955)
(57,970)
10,108
11,667
Taking the performance of each of our key business areas in turn:
Retail and Cold Chain Food Products (CCFP)
Sales volumes came under pressure on the back of reduced consumer spending on proteins and oils, resulting from the trading
down to cheaper nutritional alternatives. A price moderation strategy across all protein categories led to volume recovery in the
second half of the year. The period saw the outbreak of African Swine Fever in Lusaka and other Provinces, which resulted in our
pork processing operation being shut down and consequently impacted operations during the period of the animal movement
ban. The year also saw the outbreak of CBPP which negatively impacted our beef business. Chicken sales volumes struggled
as the price of chicken products remained relatively high compared with other proteins due to sustained high stock feed prices.
Given the above challenges, the Retail and CCFP business registered a revenue decline of 4% compared to the prior year. Higher
input prices, particularly feed and fuel, resulted in a reduction of gross profit by 13% from the prior year.
11
Annual Report 2022Zambeef Products PLC
CHIEF EXECUTIVE OFFICER’S REVIEW (continued)
The Retail and CCFP division generated an EBIT margin of 5.1% which decreased by 6.6% from the previous financial year to
ZMW160 million (2021: ZMW216 million) in Kwacha terms.
Cropping and Milling (Cropping, Stockfeed, and Wheat Milling)
The division registered strong results owing to growth in stock feed revenues and higher grain prices in Cropping, despite lower
soya bean yields across the country due to sporadic rainfall patterns.
The stockfeed business registered good growth due to improved supply chain planning. The export ban that existed in the first
quarter of the year impacted export sales with an increase in demand for feed being noticeable in the period after the lifting of
the ban.
The Cropping business saw margins improve on the back of higher grain prices despite an escalation in input costs, particularly
fertiliser.
Revenue in the Cropping and Milling division grew by 18% in Kwacha terms and 46% in USD terms, while the operating profit grew
by 70% to ZMW 449 million (2021: ZMW265 million) and by over 100% to USD26 million (2021: USD13 million) in dollar terms.
Finally, I would like to thank our Board of Directors and all staff and partners of Zambeef for their contribution to the continued
success of the Group. I look forward to what we will be able to achieve in the coming year as we continue to implement our growth
strategy.
Faith Mukutu
Chief Executive Officer
2 December 2022.
12
Annual Report 2022Zambeef Products PLC 13
Annual Report 2022Zambeef Products PLC SUSTAINABILITY REPORT
performance
that sound social and
We believe
environmental
drives
business value. Zambeef is committed
to provide a safe and healthy workplace
its employees and contractors,
for
protecting the environment and being
a responsible corporate citizen in the
communities where we have a presence.
This commitment is enshrined in our
Environmental & Social, Health and
Safety & Welfare Policies.
Zambeef has committed to uphold the
principles set out in the International
Finance Corporation (IFC) Performance
Standards and World Bank Group
Environmental, Health, and Safety
Guidelines on
and
social sustainability. This commitment
is
our
Environmental, Social and Governance
(ESG) Strategic Plan.
environmental
demonstrated
further
in
The Board of Directors provides oversight
through its ESG Committee. Through this
Committee the Board provides strategic
advice and guidance regarding systemic
and strategic environmental and social
matters. The Committee ensures that
the Group has adequate and robust
systems in place for monitoring the
environmental, health & safety, and
social management & performance, in
accordance with applicable legislation
and good international industry best
practice.
Zambeef is dedicated to compliance and
improvement as well as to environmental
and social activities through its robust
Sustainability team which supports the
business at operational level.
Economic Contribution
Zambeef is a significant contributor to
the country’s economic activities, with a
turnover of more than 1% of the national
gross domestic product, averaged over
the last five years.
Taxes
The Group is a significant contributor to
government revenues.
Local capital markets
A significant percentage of
the
Group’s shareholding is owned by local
institutional investors and pension funds,
including the National Pension Scheme
Authority
(NAPSA); every working
Zambian has a stake in the Group.
Employment
Export earnings
Zambeef continues to be one of the
largest employers in the country, with
7,528 staff, 13 % of who are females.
§ The Group is a member of the Zambia
Development Agency’s elite million-
dollar club of leading exporters.
60% of the of the current Executive
Team are female.
§
Over 99.5% of employees are
Zambian.
The Group’s cropping division
provides significant employment to
rural communities, where poverty
levels are higher than in urban areas.
Most of Zambeef’s raw material
suppliers are located and provide
employment to communities in rural
areas.
In the year under review, the Group
recorded foreign exchange export
income of over USD1.5 million,
while total Group USD-denominated
revenues were USD 31.2 million.
Social performance
Zambeef continues to align its social
investments
the United Nations
Sustainable Development Goals (UN
SDGs).
to
Skills development
ü The Group
is
to developing and
employees at all levels.
fully committed
its
training
§
§
§
§
§
We work closely with small & medium scale farmers;
§ They supply beef cattle, broiler chickens, pigs & milk to our
Retail and Cold Chain Food Divisions
§ They supply soya beans and maize to our stock feed
operations
§ Average annual spend is ZMW 1billion
§ We render support to the vulnerable (hospices/hospitals,
orphanages, care homes)
through food products
donation programs; these include products processed
by the Group
§ We fund and support public healthcare institutions in areas
where we operate and also run Group owned medical facilities
on our farms.
§ The Group supports community and government schools
located in communities around its farming operations.
§ The Group has constructed new class room blocks and
rehabilitated public-school infrastructure.
ü During the year, specific trainings in
food safety, occupational health and
safety, safe handling of hazardous
materials, quantifying and reporting
greenhouse gas emissions were
offered to employees.
ü The Group’s continual reinvestment
in human resources and a deliberate
focus on diversity and inclusion has
resulted in many senior positions
being held by Zambians and
females.
Food security
Zambeef continues to play a significant
role in national and regional food security.
The Group produced over 85,000 metric
tons of grain, in the financial year.
Food Quality and Safety
Group
continued making
The
improvements in the quality and safety
of foods it manufactures and offers for
sale to the public.
14
Annual Report 2022Zambeef Products PLC SUSTAINABILITY REPORT (continued)
ü Customer Feedback
line
The dedicated customer phone
(voice calls,
text messages and
WhatsApp), email service and Facebook
platforms continue
to be widely
publicised, on product packaging,
product transportation trucks and in
trading premises. These platforms
constitute an important component of
our broader stakeholder engagement
program. We receive valuable feedback
about our products and quality of service,
and that helps us to improve both the
products and services we offer.
ü One Health Schemes
and well-being
the
The business continues to implement
programs that seek to achieve optimal
health
outcomes,
recognizing
interconnections
between people, the livestock we rear
and process, the crops we cultivate
and the shared environment in which
all our activities are performed. Our
sustainability strategy recognizes all the
elements necessary to achieve our One
Health.
Occupational health and safety programs
are being
implemented to cover all
areas of our operations, ensuring that
occupational hazards are eliminated or
minimized in the work environment.
The business
is embracing Good
International Industry Practice in both
cropping and livestock farming through
the implementation of the Global Good
Agricultural Practice Standard.
falling
in categories
Pesticides
Ia.
(extremely hazardous) and Ib. (highly
hazardous), under the World Health
Organization basic clarification by
hazards, are not permitted for use in
any part of the business under any
circumstances.
Biosecurity measures
at
aimed
livestock hosting
compartmentalizing
and processing sites continue to be
implemented across the business.
to be
A Food Safety Management System
ISO 22000:2018
(FSMS) based on
continues
rolled out across
the Group’s food value chains. The
FSMS ensures that the business has a
continuous improvement program on the
quality and safety of the food it produces
and offers for sale to the public.
To date, the Chicken Processing Plant,
Dairy Processing Plant, Masterpork
Factory Novatek Feed Lusaka Plant and
the Novatek Feed Mpongwe Plant are
ISO 22000 certified. The Beef Processing
Plant and Wheat Flour Mill at Huntley
have undergone preparatory works and
are earmarked for certification in the
year ending September 30th 2023. The
Retailing network is also undergoing
preparatory works.
An environmental certification scheme
is also underway.
Inclusive business model:
The Group continues to source the
bulk of its raw materials from rural
communities in Zambia. 100% of the
beef and pork processed by the business
were sourced from third-party farmers.
Out-growers supply 65% of the broiler
chickens processed by Zamchick. 93%
of the maize and 62% of the soya beans
used at Novatek Animal Feeds were
externally supplied, predominantly by
small scale rural farmers.
This strong
linkage to rural based
suppliers helps fight poverty in these
otherwise
excluded’
‘economically
communities, meeting the aspirations
of UN SDG 1, of ‘ending poverty in all its
forms everywhere’.
In the year under review, the Group
bought grains and livestock from 62,026
small scale farmers across the country,
spending more than ZMW1 billion.
engagement:
Community
Zambeef
continues to engage with communities
in the areas where we operate. As
guided by our Stakeholder Engagement
Procedure, stakeholders are mapped
and proactively engaged on a regular
basis, and at every time developmental
projects are initiated at Group sites.
The Group complies with the guidelines
of the IFC Performance Standard number
Involuntary
1: Land Acquisition and
Resettlement,
land acquisition
matters.
in all
We have a Chance Finds Procedure, that
is aligned with IFC Performance 8: Culture
Heritage, which allows us to preserve
community
and grant unhindered
access to all properties and sites of
archaeological,
cultural,
artistic, and religious significance
historical,
Group
Support to vulnerable communities/
groups through foodstuff donations:
The
rendering
support to the vulnerable (hospices/
hospitals, orphanages, care homes)
through donations of foodstuffs. There
continues
are currently 22
institutions hosting
vulnerable people which the Group
supports
food supply
program. A total of ZMW2 million was
spent on donations in the year under
review.
through
the
This gesture by the Group aligns strongly
with UN SDG 2, whose main aspiration is
to ‘end hunger, achieve food security and
improved nutrition ...’
Other non-food donations, like water
reticulation systems were also made.
Support to educational and healthcare
institutions: Zambeef continues to fund
educational and healthcare institutions.
This includes institutions like Mpongwe
School and medical clinic, wholly owned
by the Group, where teachers, teaching
aids, healthcare workers, equipment and
facilities are fully funded by the Group.
The Mpongwe support expenditure
amounted to ZMW3.10 million in the
year under review.
The Group also supports community,
government schools and healthcare
institutions located in the areas where it
operates.
These Group activities align with UN SDG
3 and 4, whose aspirations are to ‘ensure
healthy lives and promote well-being for
all at all ages’ and ‘ensure inclusive and
equitable quality education and promote
lifelong learning opportunities for all’,
respectively.
Other: Zambeef also supports a number
of traditional ceremonies and sporting
activities across the country.
Environmental performance
Zambeef continues to work towards
good international industry practice’ by
implementing a process of continual
improvement
in environmental and
social management.
No notifiable environmental incident or
accidental release were experienced
during the financial year.
(ZEMA)
‘Environmental
During the year under review, the Group
had two Environmental Project Briefs
approved by the Zambia Environmental
Management Agency
as
governed by Statutory Instrument No.
28 of 1997
Impact
Assessments Regulations’ read together
with the Environmental Management
Act No. 12 of 2011. The practice also
fulfils the requirements of IFC PS 1:
‘’Assessment and Management of
Environmental and Social Risks and
Impacts.”
15
Annual Report 2022Zambeef Products PLC SUSTAINABILITY REPORT (continued)
The underlisted projects were allowed by
the ZEMA Board;
Climate Change
The Group has been developing a
customized GHG Assessment Tool
(based on
the Global Livestock
Environmental Assessment Model-i
methodology and experiences of similar
assessments
in Africa) and climate
footprint monitoring guidelines. The
climate footprint monitoring guidelines
included benchmarking of climate
performance
of
recommended areas for improvement
highlighting
and
1.
Installation of 40,000 litre above
ground diesel tank at Kalundu Dairy
Farm, Chisamba District, Central
Province.
2. Proposed housing complex at
Huntley Farm, Chibombo District,
Central Province.
16
and application of best-practice climate
solutions.
The Tool has been developed to calculate
the annual carbon footprint of the user-
specified Zambeef facilities. In addition,
the Tool will assist the Group to set GHG
emission reduction targets and develop
decarbonization strategies.
to
To underscore our commitment
reducing the carbon footprint of its
operations, a decision was made to
discontinue the use of charcoal for
commercial purposes.
Annual Report 2022Zambeef Products PLC CORPORATE GOVERNANCE STATEMENT
a
Code. Further, the Company has formally
adopted the Quoted Companies Alliance
(QCA) Corporate Governance Code
(“QCA Code”) on a ‘comply or explain’
basis, as required by the AIM Rules for
Companies.
FRAMEWORK
As a Company listed on exchanges in
Lusaka and London, we are required
to comply with LuSE and UK specific
Corporate Governance codes. The UK
Corporate Governance Code does not
apply to companies floated on the AIM
Market of the London Stock Exchange,
the market on which Zambeef is listed.
For the purposes of being quoted on AIM,
the Company has agreed to maintain
standards of corporate governance
recommended by AIM. In this regard,
and bearing in mind the size and scale
of the operations of the Company, the
Company has adopted the QCA Code
as the basis of its corporate governance
standards.
On LuSE, Zambeef Products Plc. has
established
formal governance
framework by way of adopting the
LuSE code as well as comprehensive
company policies and guidelines, audit
and assurance procedures which ensure
compliance with applicable laws and
regulations recognized codes of good
practice.
This report, alongside further relevant
information contained
the other
reports and financial statements that
form part of the Annual Report for
the year, therefore, aims to provide an
overview of the Company’s governance
practices. It is comprehensive, albeit to
avoid duplicity of information.
CORPORATE GOVERNANCE IN ACTION
The Company’s corporate governance
practices are put
the
Corporate Governance Handbook which
is subject to review by the Board from
time to time. The Handbook addresses
the various areas of governance and
covers the following aspects:
§
Share Dealing Code
§ Disclosure Policy
§ AIM Rules Compliance Policy
§ LuSE Listing Rules Compliance
together
in
in
Policy
§ Anti-Corruption and Bribery Policy
including Incident reporting and
whistleblowing
§ Social Media Policy
§ Related Party Transactions Policy
§ Delegation of Authority
§ Board Charter
§ Terms of Reference for the
Remuneration and Succession
Committee
§ Terms of Reference for the Audit and
Risk Committee
§ Terms of Reference for the
Environmental and Social Committee
§ Memorandum on Inside Information
and;
is
responsible
§ Group Code of Ethics
THE BOARD OF DIRECTORS
The Company has a unitary board of
directors, which at the start of the year
under review, comprised nine directors
but later reduced to seven, retaining
a number within that required per its
Articles of Association, yet balancing
the requisite business acumen and
skills pertinent to the business. Of the
seven Directors, five are Non-Executive
Directors, and
two are Executive
Directors. Four of the five Non-Executive
Directors are considered independent
by the Board, in terms of the guidelines
prescribed in the QCA Code and the LuSE
Corporate Governance Listing Rules.
the
The Board
for
performance and direction of
the
Company, through the establishment
of strategic objectives and key policies,
as well as approving major business
decisions, in accordance with its charter.
its overall
The Board believes that
is appropriate, with no
composition
individual or group dominating
the
decision-making process, and with a
good balance of knowledge, experience
independence. The role of the
and
Chairman
is separate from that of
the Chief Executive Officer (CEO) and
considered to be independent.
New appointments to the board are
carried out in a transparent manner
and are made in accordance with the
recommendations of the Remuneration
and Succession Committee
and,
following approval of the board, are
subject to confirmation by shareholders
at the Annual General Meeting.
Details of the current Directors, their roles
and background are available on the
Company’s website at www.zambeefplc.
com.
RESPONSIBILITIES OF THE BOARD
The Board responsibilities are set out
by a Board Charter, which requires
that there is an appropriate balance of
power and authority on the board. The
Board Charter was reviewed during the
year under review, the board satisfied
its
compliance
is responsible
therewith. The Board
for
the
the overall stewardship of
Company. The Board’s role consists of
two fundamental elements: decision-
making and oversight. The decision-
making function is exercised through
the formulation with management of
fundamental policies and strategic goals
and the approval of certain significant
actions. The oversight function concerns
the review of management decisions,
the adequacy of systems and controls
responsibilities
in
17
Zambeef Products Plc (“Zambeef” or
the “Company”) remains committed to
maintaining, promoting and achieving
the highest standards of corporate
governance and corporate citizenship
by adhering to the relevant codes of
best practice, and the principles of
fairness, accountability, responsibility,
transparency and integrity.
Recognising that achieving a long-term
sustainable business depends on stable,
well-functioning
and well-governed
environmental, social, economic and
governance practices,
the Company
strives for continual development in
these areas.
Additionally, the Company through its
Board of Directors has put together
its basic
framework on Corporate
Governance and has developed a
Corporate Governance Code
that
complies with the Lusaka Securities
Exchange (LuSE) Corporate Governance
Zambeef Products
Plc (“Zambeef” or the
“Company”) remains
committed to maintaining,
promoting and achieving
the highest standards of
corporate governance and
corporate citizenship by
adhering to the relevant
codes of best practice, and
the principles of fairness,
accountability, responsibility,
transparency and integrity.
Annual Report 2022Zambeef Products PLC CORPORATE GOVERNANCE STATEMENT (continued)
and the implementation of policies. In performing its role, the Board makes major policy decisions, participates in strategic
planning, delegates to management authority and responsibility for day-to-day affairs and reviews management’s performance
and effectiveness.
Principles of good governance are embedded in the way the Board; its sub-committee and the executive committee operates their
business. The Board applies integrity, principles of good governance and accountability throughout its activities and each director
brings independence of character and judgment to their role.
CHAIRMAN AND CEO ROLES
The roles of the Chairman and CEO are performed by separate persons, with the Chairman being responsible for;
§ Providing leadership to the Board in relation to all Board Matters;
§ Representing the views of the Board to the public;
§ Acting as a conduit between the Board and being the primary point of contact between the Board and the Chief Executive
Officer;
§ Overseeing the Board agenda and conducting all Board meetings;
§ Overseeing and conducting Annual General Meeting (AGM) and other shareholder meetings and;
§ Keeping the Board informed of all major project proposals by way of specific reports;
The Board Composition
Director
Michael Mundashi
Faith Mukutu
Roman Frenkel
Pearson Gowero
Jonathan Kirby
Title
Chairman
Executive Director (CEO)
Non-Executive Director
Independent Non-Executive Director
Independent Non-Executive Director
Monica K Musonda
Independent Non-Executive Director
Walter Roodt
Executive Director
Date of Appointment
04/09/2019
04/09/2019
01/03/2021
01/03/2021
03/08/2017
01/03/2021
1/03/2019
As of the date of the report, the Board comprised of the Chairman (Independent Non-Executive Director), and four Non-Executive
Directors, three of whom, together with the Chairman, are considered by the company to be independent in character and
judgement and free from any business or other relations that could materially interfere with the exercise of their judgement. Brief
curricula vitae of the directors appear on pages 24 – 25 of this report.
The Board is satisfied that all the Directors have sufficient time to devote to their roles and that it is not placing undue reliance on
key individuals.
MEETINGS OF THE BOARD
The board has four regular meetings each year and the company’s Articles of Association make provision for decisions to be
taken between meetings by way of written resolutions, when required. During the
BOARD
MEETING
(24/11/2021)
BOARD
MEETING
(16/02/2022)
BOARD
MEETING
(8/06/2022)
BOARD
MEETING
(27/10/2022)
TOTAL
MEETINGS
ATTENDED
TOTAL
MEETINGS
HELD
RS
RS
RS
RS
X
4
4
2
4
4
2
4
4
3
4
4
4
4
4
4
4
4
4
DIRECTORS'
NAME
M Mundashi
W Roodt
F Braeken
R Frenkel
P Gowero
Y Kachinda
J Kirby
F Mukutu
M Musonda
Key
X
RS
Attended
Absent
Resigned
BOARD COMMITTEES
To assist in exercising its responsibilities, the Board has established three committees:
•
•
•
the Audit and Risk Committee
the Remuneration and Succession Committee
the Environmental and Social Governance Committee.
18
Annual Report 2022Zambeef Products PLC CORPORATE GOVERNANCE STATEMENT (continued)
The Board committees operate under approved mandates and terms of reference, which define their functions and responsibilities.
Through the Company’s management committee, management meets and serves to assist the board to co-ordinate, guide and
monitor the management and performance of the Company. Following each meeting, the committee chair reports to the Board
on the committee’s activities, and makes such recommendations as are deemed appropriate in the circumstances. Minutes
of committee meetings are made available to all directors on a timely basis. Non-executive directors actively participate in all
committees.
1. Audit and Risk Committee
The Board approved the membership to the Audit Committee of the long outstanding and independent advisor and co-opted
member - Hastings Mtine in September 2021. (QCA Code principle 6: He has extensive experience as a Chartered Accountant in
the fields of financial reporting, external audit, internal audit, corporate governance and risk management gained in public practice
and on various corporate boards. He is a former Senior Partner for KPMG Zambia. He provides a detailed review and advisory
service to the Audit Committee across each of these areas.
Responsibilities:
•
The primary role of the Audit Committee is to ensure the integrity of the financial reporting and audit process, including review
of the interim and annual financial statements before they are submitted to the board for final approval.
To ensure that a sound risk management and internal control system is maintained and reviewing the system for monitoring
compliance with applicable laws and regulations.
To give due consideration and review of corporate governance matters in accordance with relevant frameworks including the
LuSE Corporate Governance Code and the QCA Code.
•
•
• Monitor and review the reports and function of the internal audit department, in line with its own charter, which requires
systematic evaluation of the effectiveness of risk management, control, compliance and governance processes for the
Group.
• Monitor and review the reports of the external auditors and their performance.
•
At least once a year, the members of the committee should meet the external auditors without the presence of any Executive
Director.
The committee should also consider and make recommendations to the Board, to be put to shareholders for approval at the
Annual General Meeting, as regards the appointment and/or reappointment of the company’s external auditor.
•
• Monitor the ethical conduct of the Company, its executives and senior officials.
Committee Meeting Attendance Schedule
NAME
CATEGORY OF DIRECTOR
Jonathan Kirby
Chair: INED
Frank Braeken*
Pearson Gowero
Roman Frenkel
NED
INED
NED
Hastings Mtine
Committee Member
24/11/2021
14/02/2022
31/05/2022
RS
14/09/2021
RS
Key
RS
Attendance
Resigned
2. Remuneration and Succession Committee
The committee provided oversight over the remuneration and compensation for senior management to retain and motivate
staff to perform at the level of the quality required. The committee is chaired by an independent non-executive director.
Chairman – Monica Musonda
Members - Yollard Kachinda and Frank Braeken resigned from the Board and the committee in May 2022, Jonathan Kirby and
Felicity Preacher as an observer from British International Investment (BII).
Responsibilities:
•
•
•
•
•
Regularly review the structure, size, knowledge, experience and diversity of the Board, as well as the sub-committees of the
Board, and make recommendations to the Board with regard to changes.
Responsible for identifying, evaluating and nominating, for the approval of the Board, candidates to fill Board vacancies as
and when they arise.
Consider succession planning for Directors and other senior executive management, and in particular, for the key roles of
Chairman and CEO of the Company. The appointment of CEO and directors can only be made following a formal, rigorous
assessment by this committee and its formal recommendations being made to the Board, having also evaluated the balance
of skills, knowledge, experience and diversity on the Board.
Determine and agree with the Board the framework or broad policy for the remuneration of the CEO, the Chairman of the
Board, the Executive Directors, the Company Secretary, and such other members of the executive management of the Group
to whom the Board has extended the remit of the committee.
Determining the remuneration policy by considering all factors which it deems necessary, including relevant legal and
regulatory requirements, the provisions and recommendations of the QCA Code and associated guidance. The objective of
such policy shall be to ensure that members of the Group executive management are provided with appropriate incentives
19
Annual Report 2022Zambeef Products PLC
CORPORATE GOVERNANCE STATEMENT (continued)
•
to encourage enhanced performance and are, in a fair and responsible manner, rewarded for their individual contributions to
the success of the Group.
The committee ensures reporting of the Remuneration Committee’s agreed fees and remuneration, for both the executive
directors and non-executive directors, in the formal Report of the Directors in the Annual Report. This requires formal approval
by the shareholders in an AGM. The Chairman ensures he is available to answer questions/comments put forward by the
shareholders in the AGM regarding directors’ fees and remuneration.
Perform evaluations of the Board, Board Committees (and their constituents), and recommend training where necessary.
•
Committee Meeting Attendance Schedule
NAME
Monica Musonda
Frank Braeken
Yollard Kachinda
Jonathan Kirby
Felicity Preacher***
CATEGORY OF DIRECTOR
Chair: INED
NED
INED
NED
Observer
24/11/2021
14/02/2022
30/05/2022
BA
BA
RS
RS
Key
BA
RS
Attendance
Before Appointment
Resigned
***
Pursuant to the Shareholder Agreement with BII, an observer is permitted to attend meetings and participate in
deliberations but may not vote
3. Environmental and Social Committee
Chairperson - Pearson Gowero
Members – Roman Frenkel, Monica Musonda and Yollard Kachinda
Responsibilities:
•
•
Provide strategic advice and guidance to the Board in relation to systemic and strategic environmental and social (“E&S”)
issues which affect the Company’s business model and strategy.
Ensure that the Company has in place adequate and robust systems, policies and procedures for monitoring the E&S
management of the Company, in accordance with applicable legislation and Good International Industry Practice (“GIIP”),
defined by IFC Performance Standards.
• Monitor the implementation of the Environmental and Social Action Plan and any corrective action plans that may be
•
•
•
developed in due course.
Oversee any Company investigations relating to breaches of E&S laws, regulations and standards and/or the Company’s E&S
policies, management systems and plans.
Ensure good corporate citizenship through promotion of equality, prevention of unfair discrimination and reduction of
corruption.
Ensure contribution to development of the communities in which its activities are predominantly conducted, or within which
its products or services are predominantly marketed.
Committee Meeting Attendance Schedule
NAME
Pearson Gowero
Roman Frenkel
Yollard Kachinda
Monica Musonda
CATEGORY DIRECTOR
Chair: INED
NED
INED
INED
23/11/2021
14/02/2022
31/05/2022
RS
Key
RS
Attendance
Resigned
Retirement and Election of Directors
It is the Board’s policy that new directors are subject to confirmation at the first opportunity following their appointment. All
directors, excluding the Executive Directors are subject to retirement and re-election on a rotational basis with one-third of the
board being re-elected annually. This is in accordance with Section 206 (5) of the Companies Act.
Performance Evaluation of the Board
The Board carries out an annual self-assessment of its performance during the year, based on its Board Charter’s objectives, with
the Company Secretary collating and reporting on the findings from each Board member.
20
Annual Report 2022Zambeef Products PLC
CORPORATE GOVERNANCE STATEMENT (continued)
Areas covered in the self-assessment
include:
• Management of Board meetings and
discussions;
• External
and
Internal
Board
relationships;
• Skills of Board members;
• Reaction to events;
• Chairman;
• Chairman and CEO relationships;
• Attendance and contribution
in
meetings;
• Open channels of communication;
• Risk and Control frameworks;
• Composition;
• Terms of Reference;
• Committees of the Board;
• Company Secretary;
• Timeliness of information;
• Board Agenda;
• AGM;
• External Stakeholders;
•
Induction and training; and
• Succession planning.
The board will continue to implement
its
necessary changes
performance.
to enhance
BOARD
DEVELOPMENT
INDUCTION
AND
Newly appointed directors are taken
through
the Company’s Articles of
Association, the Board Charter, Codes of
conduct, policies, listing regulations and
applicable acts such as Companies Act
and Securities Act. They follow a tailored
induction programme facilitated by the
Company Secretary which includes a
scheduled trip to tour the operations.
COMPANY SECRETARY
The Company Secretary is responsible
for implementing and sustaining high
levels of corporate governance and
keeps abreast of legislation, regulations
and corporate governance developments
which may impact on the business.
All Directors have direct access to the
Company Secretary.
STAFF DEVELOPMENT,
TRAINING AND INFORMATION
TECHNOLOGY
The Company is committed to staff
development and training as this is a key
ingredient to continued and improved
operations.
The Company places emphasis on
information technology as key in its
strategy of delivering quality products
which are the first choice of our
customers and consumers.
STAKEHOLDER RELATIONS
places
in maintaining
considerable
ZZambeef
importance
active
investor relations through open, fair
and transparent communications. The
Company ensures timely dissemination
of information to its investors and other
stakeholders through various media. A
dedicated shareholders unit through the
Transfer Secretaries is responsible for
active interaction with the shareholders.
The Zambeef business model has
the
identified
importance of maintaining strong
working relationships with;
understands
and
•
•
•
•
its key small-scale suppliers across
grains and livestock,
its larger commercial raw material/
input suppliers and livestock
suppliers,
its wide customer base across
stockfeed, cold chain food products,
and other products,
its regulators such as Zambia
Environmental Management Agency
(ZEMA), Patents and Companies
Registration Agency (PACRA), Water
Resources Management Agency
(WARMA), Lusaka Stock Exchange
(LuSE), Securities and Exchange
Commission (SEC), AIM Nominated
Advisor;
•
its financiers;
• social responsibility partners in
communities.
(AGM)
In addition, Zambeef has shareholder
through Annual
meetings,
formally
General Meetings
and
Extraordinary General Meetings (EGM),
where required, and informally through
half-yearly meetings with institutional
shareholders. Shareholders’ views are
communicated in an open and frank
manner, with senior management
taking due note of their concerns when
expressed. The Board believes that these
engagements have proven successful,
as shareholder views have fed into the
current corporate strategy. The CEO and
Chief Financial Officer (CFO) meet and
conduct formal results presentations
with shareholders on a half-yearly basis.
The Board considers the AGM key
in providing shareholders with
the
the Board and
to ask
opportunity
chairperson of the Audit committee
questions concerning the affairs of the
Company. Accordingly, all
legal and
regulatory requirements, notices and
information are released well in advance
to
stock
exchange and Company websites. To
this end, the Company ensures copies
of the Annual Report and Accounts are
made available well before the AGM
as this ensures the shareholders have
insight of the business performance.
shareholders,
regulators,
The Group publishes the outcome of
all shareholder resolutions immediately
after each AGM or EGM. Zambeef
maintains all market announcements
and Annual Reports on its website for
the last 10 years.
Internally the Board and Management
consider effective communication as
being critical to the success of the
business.
INTERNAL AUDITORS
TThe Company has an internal audit
function designed to add value to the
Company and improve operations.
The Internal Audit function provides an
independent assurance service to the
Board, the Audit and Risk Committee and
management. The Internal audit function
is formally defined via an Internal Audit
charter and assists the Company to
accomplish its objectives by bringing a
systematic approach in the evaluation
of the effectiveness of the governance,
risk management and control processes
that management has put into place.
The head of the internal audit function
attends the Audit and Risk Committee
meetings and has unrestricted access to
the chairperson of the committee.
The Board requires competitive bidding
for significant purchases and contracts,
above determined thresholds, through a
formal Board-approved Delegations of
Authority policy that covers the Board
and senior management.
EXTERNAL AUDITORS
External auditors are appointed by
the shareholders and are subject to
reappointment at the AGM. The current
external auditors of the Company are
PricewaterhouseCoopers (PwC).
The Company together with external
that quality and
auditors ensures
independent audits are undertaken
21
Annual Report 2022Zambeef Products PLC CORPORATE GOVERNANCE STATEMENT (continued)
through regular and systematic audit
planning and also rotation of client staff
engaged on the audits.
ORGANISATIONAL INTEGRITY
In its continued efforts to foster integrity
within the organisation, the Company
continues to enforce the Group Code
of Ethics policy and encourages all
employees to make a declaration of their
assets and/or business involvements’
every year.
Employees are also encouraged to
declare all the gifts received in the
course of employment by way of a gift
register, maintained by the Company
Secretary.
INTERNAL CONTROL
The control systems are designed
to safeguard the Company’s assets,
maintain proper accounting records and
ensure the reliability of management and
financial information produced by the
Company. Control systems are based
on established Zambeef group policies
and procedures and are implemented by
trained personnel, with an appropriate
segregation of duties.
The effectiveness of these
internal
controls and systems is monitored by
the internal audit department, with the
aid of self-assessment audit checklists.
Management is also in the transitional
process of reporting Internal Controls
over Financial Reporting as prescribed
by the Zambian Securities and Exchange
Commission.
independent
The
external auditors, through the audit
work they perform, confirm that the
abovementioned monitoring procedures
are being applied effectively.
Nothing has come to the attention
of the Directors or the independent
external auditors to indicate that any
material breakdown in the functioning
of abovementioned internal controls and
systems has occurred during the year
under review.
ETHICS
The Company’s fundamental policy is
to conduct its business with honesty
and integrity and in accordance with
the highest legal and ethical standards.
The Company has a Code of Conduct
and Business Practices, determining the
minimum standards required of all staff,
which is disseminated throughout the
Company.
The Company has implemented, and
widely disseminated to all stakeholders
22
(including suppliers), a Group Code of
Ethics and Conduct.
INCIDENT REPORTING, ANTI-
BRIBERY AND CORRUPTION
AND
WHISTLEBLOWING
POLICIES AND PROCEDURES
The Company has detailed policies and
procedures covering Incident Reporting,
Anti-Bribery and Corruption (ABC) and
Whistleblowing.
The Group’s ABC program has been
formulated in conjunction with British
International Investment (Bii), following
best international practice. It is well
structured, documented and rigorously
monitored.
a
is
and
dedicated
complaints.
There
internal
Whistleblowing Manager, managing
reports
These
complaints can be made in various
forms, and anonymously, without
fear of adverse consequences. This
policy has active senior management
encouragement
widely
communicated within the Group, with
a verifiable and transparent process of
handling complaints. This has resulted
in valuable information being obtained
for further action.
and
is
Internal Audit closely monitors, reviews
and reports on all of these policies to the
Audit and Risk Committee of the Board.
LEGAL COMPLIANCE
The board requires management to
submit an annual declaration confirming
that the Company’s operations complied
laws and regulations.
with relevant
In addition, the Company complies
with
legislation. The Company
has recourse to the group Company
Secretary and external legal advice on
matters of legal compliance.
local
INSIDER TRADING
Directors and officers of the Company
who have access to unpublished, price
sensitive information, in respect of the
Company, are prohibited from dealing
in the shares of the Company, during
defined
including
restricted periods,
those periods immediately prior to the
interim and final
announcement of
regulations
financial
are clearly stipulated
in the Share
Dealing Code section of the Corporate
Governance manual.
results. These
SHARE DEALING
The Company has adopted a share-
dealing code for dealings in shares
by Directors and senior employees
an
for
appropriate
AIM-quoted
company. The Directors ensure that they
comply with Rule 21 of the AIM rules
for Companies relating to Directors’
dealings and take all reasonable steps
to ensure compliance by the Company’s
relevant employees, including obtaining
the advice of its AIM Nominated Advisor.
In compliance with the Market Abuse
Regulation (MAR), the Chairman of the
Board is responsible for share dealings
by
the
the Directors, assisted by
Company Secretary as the Compliance
Officer.
Directors’ Interests in other companies
In compliance with Section 110 of the
Companies Act of Zambia, all Directors
are required to declare to the Board
their interests in other companies, and
this is considered if any such company
enters into any contract with any Group
company. The Group has a Related-
Parties Transactions policy which
aims to ensure transparency in related-
transactions and appropriate
party
approved
management
transactions.
any
of
RELATED-PARTY
TRANSACTIONS
for
The Board gives authorisation
any transactions carried out by the
group with any anyone or considered
a related party. Such transactions are
evaluated as to whether the parties are
treated fairly and market conditions.
For recurrent transactions carried out
with clients during the GGroup’sordinary
course of business under normal market
conditions that are not significant, the
Board gives prior authorisation for the
general terms of the transaction.
DIRECTORS’ SHAREHOLDINGS
In compliance with Sections 30, 110 and
195 of the Companies Act of Zambia, all
Directors are required to disclose their
shareholdings in the Company and any
related companies.
MARKET DISCLOSURE
prepares
Company
The
trading
statements, interim and final results as
required by the AIM market, the LuSE and
SEC rules and also prepares a detailed
to accompany
narrative statement
the results.
Company results are
disseminated widely through the LSE,
LuSE, newswires and our distribution
lists.
Annual Report 2022Zambeef Products PLC CORPORATE GOVERNANCE STATEMENT (continued)
COMPLIANCE STATUS OF LuSE CORPORATE GOVERNANCE RULES
ZAMBEEF COMPLIANCE SCHEDULE
Category
Total
Rules
Applicable
Non-
Applicable
Full
Compliance
Partial
Compliance
Non-
Compliance
%N/A
%FC
%PC
%NC
General Matters
15
15
Chairman and CEO
Executive and NEDs
Directors'
Compensation
Share & Share
dealings
Board meetings
Board evaluations
Company Secretary
Board committees
Legal and Compliance
External audit
Internal audit
Risk
Integrated
sustainability reporting
Disclosure and
Stakeholder Reporting
Organisation integrity
5
4
9
4
4
1
4
10
2
7
12
7
7
4
6
4
4
9
4
4
1
4
10
2
7
12
7
7
4
6
101
100
1
1
15
4
4
9
4
4
-
4
9
2
7
12
7
7
4
6
97
0
1
-
1
2
-
20
1
100
80
100
100
100
100
100
1000
100
100
100
100
100
100
100
100
98
Summary of areas that are not fully compliant or inapplicable
Areas not applicable
i.
If the role of the chairperson and chief executive are performed by the same person;
a. The Board must have an independent director as deputy chairperson
b. There must be a complement of independent directors sufficiently involved in the annual evaluation of the chairperson’s
performance
23
Annual Report 2022Zambeef Products PLC Board of Directors
Michael Mundashi (age 64)
Experience
Chairman
Non-Executive Director
Nationality: Zambian
Qualifications
Bachelor of Laws Degree (University of
Zambia); Post Graduate qualification as an
Advocate of the High Court of Zambia
Over 30 years post qualification experience in
both the public and private sectors. Served as
Chairman of the Zambian Tax Appeals Court
and as Independent Non- Executive Chairman
of Standard Chartered Bank Zambia Plc.
External appointments Currently serving
as Chairman of Sanlam Insurance; Director
of Nico General Insurance. Also, full-time
Managing Partner of the law firm of Mulenga
Mundashi Legal Practitioners.
Faith Mukutu (age 42)
Experience
Executive Director: Chief Executive Officer
Nationality: Zambian
Qualifications
A.C.C.A. (Chartered Certified Accountant)
– Zambia Centre for Accountancy Studies,
Zambia;
Certified Accounting Technician – Zambia
Centre for Accountancy Studies, Zambia
Over 15 years’ experience in senior finance
positions of major corporates, including
Zambia Sugar Plc and Zambian Breweries
(part of SABMiller Group)
External appointments Current directorships
include Bayport Financial Services Ltd, Good
Nature Agro and Zayohub Zambia Ltd.
Katebe Monica Musonda (47)
Non-Executive Director
Chair Remco
Nationality: Zambian
Qualifications
LL. B (UNZA); LL.M (Corporate Law & Finance
- London)
Executive Management Programme (Harvard
Kennedy)
Jonathan Kirby (age 60)
Non-Executive Director
Nationality: South African
Qualifications
Bachelor of Accounting (University of the
Witwatersrand, RSA) Higher Diploma in Tax
Law (Rand Afrikaans University, RSA) CA
(RSA)
Experience
Over 15 years PQE, Debt & Equity Capital
Markets & Project Finance;
9 years in FMCG having founded Java Foods
Previously worked as General Counsel to the
Dangote Group
External Appointments
Independent Non-Executive Chair Airtel
Networks Plc & Zambian Breweries Plc
Non-Executive Director Arcelor Mittal South
Africa Plc, Mixta Nigeria, Dangote Cement
Zambia
Founder & CEO Java Foods
Experience
Over 30 years of business management and
Finance in London, Hong Kong, Singapore and
South Africa.
Previously Vice President (Finance) of AB
Inbev Africa and CFO of SABMiller Africa.
External appointments
Currently on the boards of MIRO Forestry
Products Ltd, Prime Financial Services Group,
Cavalier Food (Pty) Ltd, South Africa and
McWade Productions (Pty) Ltd, South Africa.
24
Annual Report 2022Zambeef Products PLC Board of Directors (continued)
Roman Frenkel (age 42)
Non-Executive Director
Nationality: British
Qualifications
Durham University MEng Mechanical
Engineering;
ACA (ICAEW)
Experience
Over 10 years of investment experience in
private equity in emerging markets. Previously
Investment Director at Ethemba Capital LLP,
emerging markets private equity fund based
in London. Previously investment banker
at Merrill Lynch in London and transaction
services and audit professional at KPMG in
London.
External Appointments
Currently Director, Food & Agriculture, Direct
Private Equity at BII PLC in London.
Pearson Gowero (age 64)
Experience
Non-Executive Director
Nationality: Zimbabwe
Qualifications
BSc (Economics) Hons (University of
Zimbabwe)
MBL (University of South Africa)
40 years of experience in business
management including Retail and Fast-
Moving Consumer Goods. He served in
various senior executive roles as well as Chief
Executive Officer of two listed companies.
External appointments
Has previously served as a Director on
several boards and is currently a Director
of both SeedCo Zimbabwe Limited and
SeedCo International Limited. He has in-depth
knowledge of Zambian and Zimbabwean
Industries.
Walter Roodt (age 46)
Experience
Executive Director – Strategic Projects &
Large Livestock.
20 years of experience in Agriculture in
Southern Africa
Nationality: Namibian
Qualifications
External appointments:
Director of City Dental Ltd
BSc. (Agric.) Animal Science (University of
Pretoria, RSA); MSc. (Agric.) Nutrition Science
(University
of Pretoria, RSA); Senior Executive Programme
(London Business School, UK)
25
Annual Report 2022Zambeef Products PLC Directors report
For the year ended 30 September 2022
The Directors submit their report together with the audited annual financial statements for the year ended 30 September 2022,
which disclose the state of affairs and performance of Zambeef Products PLC (the “Company”) and its subsidiaries (together,
“the Group”).
Principal activities
The principal activities of the Group are the production, processing, distribution and retailing of beef, chicken, pork, milk, dairy
products, eggs, edible oils, stock feed and flour. The Group also has large row cropping operations (principally maize, soya beans
and wheat), with approximately 12,257 Hectares of row crops under irrigation and 8,750 Hecatares of rain-fed/dry-land crops
available for planting each year. The Group also has retailing operations in Nigeria and Ghana.
Share capital and beneficial owner(s)
The authorised share capital of the Company remained unchanged at 700,000,000 ordinary shares of K0.01. each. The issued and
fully paid-up share capital remained at 300,579,630 ordinary shares of K0.01 each.
The Group’s notable shareholding and beneficial ownership is represented as follows:
Name of shareholder
British International Investment Plc
Africa Life
National Pension Scheme Authority (Zambia)
M & G Investment Management
Krohne Capital
SBM Securities
Sussex Trust
Eastspring Investment
Rhodora
Number of shares
52,601,435
43,030,134
24,797,818
18,700,000
17,979,408
15,925,191
14,000,000
11,995,062
8,639,374
% of shareholding
17.5%
14.3%
8.2%
6.2%
6.0%
5.3%
4.7%
4.0%
2.9%
BII Plc are also the holders of 100,057,658 convertible redeemable preference shares. These shares have four voting rights for
every five preference shares held resulting in BII having 34.8% of the voting rights.
Significant events during the year
During the year, the goodwill on the cash generating unit, Zamchick was impaired in full. The impairment loss amounted to K142
million (2021: Nil).
Results and dividend
The profit for the year of K31.6 million (2021:K168.8 million) has been added to retained earnings.
The Directors have not declared a dividend nor have any dividends been paid during the year (2021: Nil)
Directors and remuneration
The Directors who held office during the year and to the date of this report were:
Name
Michael Mundashi SC
Faith Mukutu
Yollard Kachinda
Jonathan Kirby
Frank Braeken
Katebe Monica Musonda
Pearson Gowero
Roman Frenkel
Walter Roodt
Position
Chairman
Chief Executive Officer
Non-executive Director
Non-executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Executive Director
Resigned on 14 April 2022
Resigned on 27 May 2022
26
Annual Report 2022Zambeef Products PLC Directors report (continued)
For the year ended 30 September 2022
During the year, the total Directors remuneration for services rendered by Executive Directors and Non-Executive Directors were
as follows:
Name
Position
Walter Roodt
Faith Mukutu
Executive Director
Executive Director
Michael Mundashi SC
Jonathan Kirby
Yollard Kachinda
Frank Braeken
Katebe Monica Musonda
Pearson Gowero
Margaret Mudenda
John Rabb
Lawrence Sikutwa
Enala Mwase
Total
Non-Executive Director
Non-executive Director
Non-executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
Non-Executive Director
2022
K’000
5,033
5,348
10,381
920
580
260
347
580
580
-
-
-
-
3,267
13,648
2021
K’000
5,445
4,950
10,3945
860
534
463
463
338
338
120
120
100
100
3,438
13,833
Interests register information
During the year, the Group officers (a Director, Company secretary or executive officer of a Company) made declarations of
interest in Company transactions and business as follows:
Name of Director
John Rabb*
Katebe Monica Musonda
2022- shares
Direct
-
-
-
Indirect
14,000,000
555
14,000,555
2021- shares
Direct
-
-
-
Indirect
14,000,000
555
14,000,555
*John Rabb retired on 28 February 2021.
In 2021, Frank Braeken was engaged for consultancy work at a fee of K790,200.
The interests’ register, as required by the Companies Act, 2017 of Zambia, containing particulars of the above stated interests
declared, is available for inspection at the Group’s registered office.
Average number of employees and remuneration
The total remuneration of employees during the year amounted to K667.9 million (2021: K648.5 million) and the average number
of employees were as follows:
Month
October
November
December
January
February
March
Average Number
6,873
7,140
7,530
7,062
7,407
7,410
Month
April
May
June
July
August
September
Average Number
7,410
7,314
7,679
7,681
7,640
7,528
The Group has policies and procedures to safeguard the occupational health, safety, and welfare of its employees.
Gifts and donations
During the year, the Group made donations of K2.0 million (2021: K2.5 million) to charitable organisations and events.
Research and development
The Group did not incur any costs on research and development during the year (2021: Nil).
Exports
During the year, the Group exported K26.4 million worth of goods from Zambia (2021: K36.6 million).
27
Annual Report 2022Zambeef Products PLC Directors report (continued)
For the year ended 30 September 2022
Property, plant and equipment
During the year, the Group purchased property, plant and equipment amounting to K222.1 million (2021: K103.1 million). In the
opinion of the Directors, the carrying value of property, plant and equipment is not more than their recoverable value.
Group Auditor and remuneration
The Auditor, PricewaterhouseCoopers Zambia, has indicated their willingness to continue in office and a resolution for their
reappointment will be proposed at the next annual general meeting.
The Auditor remuneration for the year related to the audit for the year ended 30 September 2022 was K4.1 million (2021: K6.5
million).
Signed on behalf of the Board of Directors,
_______________________
Michael Mundashi SC
Director
Date: 2 December 2022
_______________________
Faith Mukutu
Director
28
Annual Report 2022Zambeef Products PLC Statement of Directors’ responsibilities
For the year ended 30 September 2022
The Companies Act, 2017 of Zambia requires the Directors to prepare annual financial statements for each financial year that give
a true and fair view of the state of affairs of the Group as at the end of the financial year and of its financial performance. It also
requires the Directors to ensure that the Group keeps proper accounting records that disclose, with reasonable accuracy, the financial
position of the Group. They are also responsible for safeguarding the assets of the Group. The Directors are further required to ensure
the Group adheres to the corporate governance principles or practices contained in Sections 82 to 122 of Part VII of the Companies
Act, 2017 of Zambia.
The Directors accept responsibility for the annual financial statements, which have been prepared using appropriate accounting
policies supported by reasonable estimates, in conformity with International Financial Reporting Standards (IFRS) as issued by the
International Accounting Standards Board (IASB) and the requirements of the Companies Act, 2017 of Zambia.
The Directors further accept responsibility for the maintenance of accounting records that may be relied upon in the preparation of
annual financial statements, and for such internal controls as the Directors determine necessary to enable the preparation of annual
financial statements that are free from material misstatement whether due to fraud or error.
The Directors are of the opinion that the annual financial statements set out on pages 36 to 97 give a true and fair view of the
state of the financial affairs of the Group and of its financial performance in accordance with IFRS as issued by the IASB and the
requirements of the Companies Act, 2017 of Zambia. The Directors further report that they have implemented and further adhered to
the corporate governance principles or practices contained in Sections 82 to 122 of Part VII of the Companies Act, 2017 of Zambia.
Nothing has come to the attention of the Directors to indicate that the Group will not remain a going concern for at least twelve
months from the date of these annual financial statements.
Signed on behalf of the Board of Directors
_____________________
Micheal Mundashi SC
Chairman
Date: 2 December 2022
_______________________
Faith Mukutu
Chief Executive Officer
29
Annual Report 2022Zambeef Products PLC Independent auditor’s report
To the Shareholders of Zambeef Products PLC
Report on the audit of the Group and Company annual financial statements
Our opinion
In our opinion, the Group and Company annual financial statements give a true and fair view of Group and Company financial
position of Zambeef Products PLC (the “Company”) and its subsidiaries (together the “Group”) as at 30 September 2022, and
of the Group and Company financial performance and their cash flows for the year then ended in accordance with International
Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB) and the requirements of
the Companies Act, 2017 of Zambia and the Securities Act, 2016 of Zambia.
What we have audited
Zambeef Products PLC’s Group and Company annual financial statements are set out on pages 36 to 97 and comprise:
•
•
•
•
the Group and Company statements of financial position as at 30 September 2022;
the Group and Company statements of profit or loss and other comprehensive income for the year then ended;
the Group and Company statements of changes in equity for the year then ended;
the Group and Company statements of cash flows for the year then ended; and the notes to the Group and Company annual
financial statements, including a summary of significant accounting policies.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards
are further described in the Auditor’s responsibilities for the audit of the Group and Company annual financial statements section
of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independence
We are independent of the Group and Company in accordance with the International Ethics Standards Board for Accountants’
(IESBA) International Code of Ethics for Professional Accountants (including International Independence Standards) (the “IESBA
Code”). We have fulfilled our other ethical responsibilities in accordance with the IESBA Code.
30
Annual Report 2022Zambeef Products PLC Independent auditor’s report (continued)
Key audit matter
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the Group and
Company annual financial statements of the current period. These matters were addressed in the context of our audit of the
Group and Company annual financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
Key audit matter
Impairment of Goodwill
The Group tests whether goodwill has suffered any impairment
on an annual basis. The recoverable amount of the cash-
generating units (CGUs) is determined based on value-in-
use calculations which require the use of assumptions. The
calculations use cash flow projections based on financial
budgets approved by management covering a five-year period.
Cash flows beyond the five-year period are extrapolated using
the estimated growth rates. These growth rates are consistent
with forecasts included in industry reports specific to the
industry in which each CGU operates.
Key assumptions used in the calculation include:
•
•
•
estimating the budgeted gross margins to be generated in
the future;
estimating the long-term growth rate; and;
determining the discount rate to be used.
We determined this to be an area of focus for the audit on
account of the significance of the judgments applied by the
Directors in determining the recoverable amount of this Cash
Generating Unit (“CGU”).
Refer to Note 3 (Critical accounting estimates and assumptions)
and Note 13 (Goodwill)
How our audit addressed the Key audit matter
•
In assessing the reasonableness of the assumptions
applied by the Directors, we performed the following
procedures:
• agreed the cash flow forecasts to the most recently
approved budgets and assessed reliability of budgeted
numbers against historic performance;
•
tested the appropriateness of assumptions used in
preparing the cash flow forecasts and company budget;
• assessed the reasonableness of the projected cash
outflows arising on repairs and maintenance expenditure
against historic performance and commitments;
• assessed the reasonableness of the long-term growth
rate against historical growth rate of the business;
• assessed the reasonableness of the determined discount
rate to ensure it was representative of the risks specific
to the CGU by relying on work performed by our experts;
• we evaluated the sensitivity of the Group’s goodwill to
fluctuations in the key assumptions applied to ascertain
the extent to which the key inputs would have to change
before goodwill would be considered impaired; and
• we tested the mathematical accuracy of the goodwill
assessment performed and agreed information used to
the general ledger.
31
Annual Report 2022Zambeef Products PLC Key audit matter
Valuation of Biological assets
i) Livestock
In measuring the fair value of livestock and standing crop,
various management estimates and judgements are required.
Estimates and judgements in determining the fair value of
livestock relate to market prices, average weight and quality
of animals, and mortality rates. The livestock grow at different
rates and there can be a considerable spread in the quality and
weight of animals that affects the price achieved. An average
weight is assumed for the animals based on a sample deemed
to be representative of the total population per breed and
genetic merit.
ii) Standing Crop
For standing crops, the most significant estimate relates to
management’s assessment of anticipated yield per hectare.
This assessment considers historic yields, climate conditions
and prices.
Key assumptions used in the calculations include:
• estimating the average weight of animals;
• estimating the market prices; and;
• estimating the anticipated yields per hectare and adjustment
related to the crops rate of growth.
We determined this to be an area of focus for the audit on
account of the significance of the judgments applied by the
Directors in determining the fair value of the biological assets.
Refer to Note 3 (Critical accounting estimates and assumptions)
and Note 16 (Biological assets).
How our audit addressed the Key audit matter
•
In assessing the reasonableness of the assumptions
applied by the Directors, we performed the following
procedures:
• assessed the determined sample to ensure it was
representative of the animal population by category and
mix;
• observed the weighing of the animals based on the
sample selected and
•
re-calculated the average weight;
• obtained the market prices from suppliers as at year end
used in the valuation process;
• assessed the reasonableness of anticipated yields per
hectare against the subsequent yields based on the
actual yields achieved
• we evaluated the sensitivity of the biological asset
values to fluctuations in the key assumptions applied to
ascertain the extent to which the key inputs would have
on the balances as at year end;
• we tested the mathematical accuracy of the assessment
performed and agreed information used to the general
ledger.
Other information
The Directors are responsible for the other information. The other information comprises the Annual Report but does not include
the Group and Company annual financial statements and our auditor’s report thereon.
Our opinion on the Group and Company annual financial statements does not cover the other information and we do not express
any form of assurance conclusion thereon.
In connection with our audit of the Group and Company annual financial statements, our responsibility is to read the other
information identified above and, in doing so, consider whether the other information is materially inconsistent with the Group and
Company annual financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report that fact. We have nothing to report in this regard.
32
Annual Report 2022Zambeef Products PLC Independent auditor’s report (continued)
Responsibilities of the Directors for the Group and Company annual financial statements
The Directors are responsible for the preparation of the Group and Company annual financial statements that give a true and
fair view in accordance with IFRS as issued by the IASB and the requirements of the Companies Act, 2017 of Zambia and the
Securities Act, 2016 of Zambia, and for such internal control as the Directors determine is necessary to enable the preparation of
Group and Company annual financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the Group and Company annual financial statements, the Directors are responsible for assessing the Group’s and
Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to liquidate the Group and Company or to cease operations, or have
no realistic alternative but to do so.
The Directors are responsible for overseeing the Group’s and Company’s financial reporting process.
Auditor’s responsibilities for the audit of the Group and Company annual financial statements
Our objectives are to obtain reasonable assurance about whether the Group and Company annual financial statements as a whole
are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will
always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material
if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the
basis of these Group and Company annual financial statements.
• As part of an audit in accordance with ISAs, we exercise professional judgement and maintain professional scepticism
throughout the audit. We also:
•
Identify and assess the risks of material misstatement of the Group and Company annual financial statements, whether due
to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient
and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is
higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or
the override of internal control;
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and Company’s internal
control;
•
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related
disclosures made by the Directors;
• Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt
on the Group’s and Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we
are required to draw attention in our auditor’s report to the related disclosures in the Group and Company annual financial
statements or, if such disclosures are inadequate, to modify our opinion.
33
Annual Report 2022Zambeef Products PLC Auditor’s responsibilities for the audit of the Group and Company annual financial statements (contin-
ued)
Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or
conditions may cause the Group and Company to cease to continue as a going concern;
•
Evaluate the overall presentation, structure and content of the Group and Company annual financial statements, including
the disclosures, and whether the Group and Company annual financial statements represent the underlying transactions and
events in a manner that achieves fair presentation;
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the
Group to express an opinion on the Group and Company annual financial statements. We are responsible for the direction,
supervision and performance of the Group audit. We remain solely responsible for our audit opinion.
We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant
audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide the Board of Directors with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our
independence, and where applicable, related safeguards.
From the matters communicated with the Board of Directors, we determine those matters that were of most significance in the
audit of the Group and Company annual financial statements of the current period and are therefore the key audit matters. We
describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when,
in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse
consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
The Companies Act, 2017 of Zambia requires that in carrying out our audit of Zambeef Products PLC, we report on whether:
i)
as required by section 259 (3)(a), there is a relationship, interest or debt which, ourselves, as the Group and Company Auditor,
have in the Group and Company;
ii) as required by section 259 (3)(b), there are serious breaches by the Group’s and Company’s Directors, of corporate governance
principles or practices contained in Sections 82 to 122 of Part VII of the Companies Act, 2017of Zambia; and
iii)
in accordance with section 250 (2), as regards loans made to a Group and Company Officer (a director, company secretary or
executive officer of the Group and Company) the Group and Company does not state the:
•
•
particulars of any relevant loan made during the financial year to which the accounts apply, including any loan which was
repaid during that year; or
amount of any relevant loan, whenever made, which remained outstanding at the end of the financial year.
In respect of the foregoing requirements, we have no matters to report.
The engagement partner on the audit resulting in this independent auditor’s report is Andrew Chibuye.
PricewaterhouseCoopers
Chartered Accountants
Date: 2 December 2022.
Lusaka
Andrew Chibuye
Practicing Certificate Number:
AUD/F002378
Partner signing on behalf of the firm
34
Annual Report 2022Zambeef Products PLC
Financial
Statements
30 September 2022
35
Annual Report 2022Zambeef Products PLC Statement of profit or loss and other comprehensive income
Revenue from contracts with customers
Change in fair value of biological assets
Cost of sales
Gross profit
Other income/(expenses)
Net impairment losses on financial assets
Impairment of goodwill
Distribution expenses
Administrative expenses
Notes
Group
2022
K’000
2021
K’000
Company
2022
K’000
2021
K’000
5(ii)
16
7
6
4(b)
13
7
7
5,394,761
4,974,351
3,361,428
2,880,062
349,462
828,361
307,574
545,343
(4,111,037)
(4,331,996)
(2,795,764)
(2,630,914)
1,633,186
1,470,716
873,238
794,491
2,491
(17,869)
(141,786)
(65,596)
(8,445)
(3,306)
-
(66,848)
(1,236,762)
(1,145,718)
17,325
(7,876)
(141,786)
(67,118)
(658,635)
(10,410)
(1,188)
-
-
(636,152)
Operating profit
173,664
246,399
15,148
146,741
Share of loss from equity investment
Finance income
Finance costs
15(ii)
8
8
(3,503)
3,541
(3,358)
45,897
(118,538)
(116,916)
(3,503)
3,534
(91,009)
(3,358)
56,792
(84,980)
Profit/(loss) before income tax
55,164
172,022
(75,830)
115,195
Income tax expense – continuing operations
10
(63,283)
(31,953)
(27,799)
(12,600)
(Loss)/profit from continuing operations
Profit from discontinued operations after tax
20(i)
(8,119)
39,697
140,069
28,754
(103,629)
39,697
102,595
28,754
Profit/(loss) for the year
31,578
168,823
(63,932)
131,349
Profit/(loss) attributable to:
Owners of Zambeef Products PLC
Non-controlling interests
Other comprehensive income:
Items that may be reclassified to profit or loss
Translation differences - foreign operations
Translation differences - Mpongwe Farms
Items not reclassified to profit or loss
Revaluation surplus
Actuarial remeasurement losses
Deferred income tax*
Other comprehensive income for the year
22
22
23
26(i)
25
29,152
2,426
31,578
167,980
(63,932)
131,349
843
-
-
168,823
(63,932)
131,349
(16,320)
(10,847)
(14,710)
(271,935)
-
-
(10,847)
(271,935)
-
(3,150)
6,394
(23,923)
192,403
(2,813)
21,199
(75,856)
-
(1,058)
3,018
(8,887)
40,125
(1,408)
826
(232,392)
Total comprehensive income for the year
7,655
92,967
(72,819)
(101,043)
36
Annual Report 2022Zambeef Products PLC Statement of profit or loss and other comprehensive income (continued)
Notes
Group
Company
Total comprehensive income for the period is
attributable to:
Owners of Zambeef Products Plc
Non-controlling interests
Basic earnings per share
Continued operations
Discontinued operations
Total basic earnings per share
Diluted earnings per share
Continued operations
Discontinued operations
Total diluted earnings per share
30
30
30
30
2022
K’000
4,970
2,685
7,655
2021
K’000
95,066
(2,099)
92,967
2022
K’000
2021
K’000
(72,819)
(73,849)
-
-
(72,819)
(73,849)
Ngwee
Ngwee
(3.51)
13.21
9.70
(2.63)
9.91
7.28
46.60
9.57
56.17
34.96
7.18
42.14
Ngwee
(34.46)
13.21
(21.25)
(25.85)
9.91
(15.94)
Ngwee
34.13
9.57
43.70
25.61
7.18
32.79
*Refer to note 32 for details regarding the restatement as a result of an error.
The notes on pages 43 to 97 form an integral part of these annual financial statements
37
Annual Report 2022Zambeef Products PLC Consolidated Statement of financial position
ASSETS
Non-current assets
Property, plant and equipment
Right of use assets
Goodwill
Investment in associate
Biological assets
Current assets
Biological assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Current income tax asset
Total assets
EQUITY
Share capital
Share premium
Preference share capital
Foreign currency translation reserve
Revaluation reserve
Retained earnings
Attributable to owners of parent entity
Non-controlling interests (NCI)
LIBILITIES
Non-current liabilities
Lease liabilities
Borrowings
Deferred income tax
Defined benefit obligations
Current liabilities
Lease liabilities
Borrowings
Trade and other payables
Contract liabilities
Current income tax
Total equity and liabilities
Notes
11
12(a)
13
15
16
16
17
18
19
20(iii)
10
21
21
21
22
23
12(b)
24
25
26
12(b)
24
27
28
10
30-Sept-22
K’000
Restated:1-Oct-21
K’000
Restated:1-Oct-20
K’000
3,134,611
32,389
25,015
36,965
86,592
3,315,572
234,104
1,441,912
289,300
223,972
170,091
-
2,359,379
5,674,951
3,006
1,125,012
1,000
692,705
1,113,119
758,489
3,693,331
66
3,693,397
12,597
426,222
223,217
3,654
665,690
5,046
525,325
649,573
97,400
38,520
1,315,864
5,674,951
3,071,735
43,283
166,801
40,468
71,365
3,393,652
287,632
1,197,846
238,278
201,539
170,550
-
2,095,845
5,489,497
3,006
1,125,012
1,000
720,131
1,160,653
678,559
3,688,361
(2,619)
3,685,742
7,253
195,555
235,250
8,891
446,949
12,418
700,913
514,205
119,206
10,064
1,356,806
5,489,497
3,213,319
51,186
166,801
43,826
62,380
3,537,512
113,925
1,103,640
142,005
111,136
175,654
1,743
1,648,103
5,185,615
3,006
1,125,012
1,000
1,003,834
1,034,388
468,453
3,635,693
(520)
3,635,173
19,750
190,218
195,444
11,389
416,801
23,259
674,944
337,766
97,672
-
1,133,641
5,185,615
The annual financial statements on pages 36 to 97 were approved for issue by the board of directors on 30
November 2022 and signed on its behalf by:
_____________________
Michael Mundashi SC
Chairman
_______________________
Faith Mukutu
Chief Executive Officer
*Refer to note 32 for details regarding the restatement as a result of an error.
The notes on pages 43 to 97 form an integral part of these annual financial statements.
38
Annual Report 2022Zambeef Products PLC 30-Sept-22
K’000
Restated:1-Oct-21
K’000
Restated:1-Oct-20
K’000
Company statement of financial position
ASSETS
Non-current assets
Property, plant and equipment
Right of use assets
Investment in subsidiaries
Investment in associate
Biological assets
Current assets
Biological assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Current income tax asset
Total assets
EQUITY
Share capital
Share premium
Preference share capital
Foreign currency translation reserve
Revaluation reserve
Retained earnings
LIABILITIES
Non-current liabilities
Lease liabilities
Borrowings
Deferred income tax
Defined benefit obligations
Current liabilities
Lease liabilities
Borrowings
Trade and other payables
Contract liabilities
Current income tax
Total equity and liabilities
Notes
11
12(a)
14
15
16
16
17
18
19
20(iii)
10
21
21
21
22
23
12(b)
24
25
26
12(b)
24
27
28
10
2,158,021
23,591
104,020
36,965
86,592
2,409,189
183,061
977,667
786,517
136,149
170,091
-
2,253,485
4,662,674
3,006
1,125,012
1,000
687,048
712,279
739,665
3,268,010
5,354
426,222
140,280
366
572,222
4,878
337,669
367,814
97,400
14,681
822,442
4,662,674
2,143,680
22,803
245,807
40,468
71,365
2,524,123
236,583
772,972
872,256
113,193
170,550
2,520
2,168,074
4,692,197
3,006
1,125,012
1,000
697,895
739,522
774,394
3,340,829
1,873
195,555
138,117
2,124
337,669
6,597
517,126
395,491
94,485
-
1,013,699
4,692,197
The annual financial statements on pages 36 to 97 were approved for issue by the board of directors
on 30 November 2022 and signed on its behalf by:
_____________________
Micheal Mundashi SC
Chairman
_______________________
Faith Mukutu
Chief Executive Officer
*Refer to note 32 for details regarding the restatement as a result of an error.
The notes on pages 43 to 97 form an integral part of these annual financial statements.
2,453,920
22,474
245,807
43,826
62,380
2,828,407
77,121
814,081
1,370,672
12,645
175,654
565
2,450,738
5,279,145
3,006
1,125,012
1,000
969,830
745,684
597,340
3,441,872
8,172
190,218
124,190
3,356
325,936
14,461
497,721
906,879
92,276
-
1,511,337
5,279,145
39
Annual Report 2022Zambeef Products PLC
Consolidated statement of changes in equity
Share
Capital
Share
premium
Preference
share
capital
Foreign
currency
translation
reserve
Revaluation
reserve
Retained
earnings
Total
attributable
to owners
of parent
entity
Non-
controlling
interests
Total
Year ended 30 September
2021
K’000
K’000
K’000
K’000
K’000
K’000
K’000
K’000
As previously presented
3,006 1,125,012
1,000
1,003,834
1,167,713
470,174
3,770,739
(520) 3,770,219
Correction of error (Note 32)
-
-
-
-
(133,325)
(1,721)
(135,046)
-
(135,046)
At start of year – restated
3,006 1,125,012
1,000
1,003,834
1,034,388
468,453
3,635,693
(520)
3,635,173
Profit for the year
Other comprehensive
income:
Revaluation surplus
Transfer of excess
depreciation
Actuarial remeasurement
losses
Deferred income tax (Note
25)
Translation differences (Note
22)
Total comprehensive income
for the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
167,980
167,980
843
168,823
192,403
-
192,403
(44,377)
44,377
-
-
(2,813)
(2,813)
(21,761)
562
(21,199)
-
-
-
-
192,403
-
(2,813)
(21,199)
-
-
-
-
-
(283,703)
-
-
(283,703)
(2,942)
(286,645)
(283,703)
126,265
42,126
(115,312)
(2,942)
(118,254)
(283,703)
126,265
210,106
52,668
(2,099)
50,569
At start of year
3,006 1,125,012
1,000
720,131
1,160,653
678,559
3,688,361
(2,619) 3,685,742
Year ended 30 September
2022
At start of year
Profit for the year
Other comprehensive
income:
Transfer of excess
depreciation
Actuarial remeasurement
losses
Deferred income tax (Note
25)
Translation differences (Note
22)
Total comprehensive income
for the year
3,006 1,125,012
1,000
720,131
1,160,653
678,559
3,688,361
(2,619) 3,685,742
-
29,152
29,152
2,426
31,578
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(53,928)
53,928
-
-
(3,150)
(3,150)
6,394
6,394
-
-
-
-
(3,150)
6,394
-
-
(27,426)
-
(27,426)
259
(27,167)
(27,426)
(47,534)
50,778
(24,182)
259
(23,923)
(47,534)
79,930
4,970
2,685
7,655
(27,426)
At year end
3,006 1,125,012
1,000
692,705
1,113,119
758,489
3,693,331
66
3,693,397
The notes on pages 43 to 97 are an integral part of these annual financial statements.
40
Annual Report 2022Zambeef Products PLC Company statement of changes in equity
Share
premium
Preference
share capital
Foreign
currency
translation
reserve
Revaluation
reserve
K’000
K’000
K’000
K’000
Share
Capital
K’000
Year ended 30 September 2021
As previously presented
3,006
1,125,012
1,000
969,830
Correction of error (Note 32)
-
-
-
-
At start of year - restated
3,006
1,125,012
1,000
969,830
Profit for the year
Other comprehensive income:
Revaluation surplus
Transfer of excess depreciation
Actuarial remeasurement losses
Deferred income tax (Note 25)
Translation losses on Mpongwe
farms (Note 22)
Total comprehensive income for
the year
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(271,935)
(271,935)
Retained
earnings
K’000
Total
597,524
3,524,910
(184)
597,340
131,349
(83,038)
3,441,872
131,349
-
40,125
46,972
(1,408)
141
-
(1,408)
826
-
(271,935)
828,538
(82,854)
745,684
-
40,125
(46,972)
-
685
-
(6,162)
45,705
(232,392)
(271,935)
(6,162)
177,054
(101,043)
At start of year
3,006
1,125,012
1,000
697,895
739,522
774,394
3,340,829
Year ended 30 September 2022
At start of year
Profit for the year
Other comprehensive income:
Transfer of excess depreciation
Actuarial remeasurement losses
Deferred income tax (Note 25)
Translation losses on Mpongwe
farms (Note 22)
Total comprehensive income for
the year
3,006
1,125,012
1,000
697,895
739,522
774,394
(63,932)
3,340,829
(63,932)
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(30,155)
-
2,912
30,155
(1,058)
106
(10,847)
(10,847)
-
-
(27,243)
29,203
-
(1,058)
3,018
(10,847)
(8,887)
(10,847)
(27,243)
(34,729)
(72,819)
At year end
3,006
1,125,012
1,000
687,048
712,279
739,665
3,268,010
The notes on pages 43 to 97 are an integral part of these annual financial statements.
41
Annual Report 2022Zambeef Products PLC Consolidated statement of cash flows
Cash flows from operating activities
Cash generated from operations
Interest paid on borrowings
Interest paid on leases
Benefits paid
Income tax paid
Group
2022
K’000
308,323
(53,473)
(1,813)
(9,672)
(44,877)
2021
K’000
206,761
(38,998)
(3,268)
(6,970)
(4,734)
Company
2022
K’000
2021
K’000
153,025
(53,473)
(784)
(3,247)
(9,828)
119,664
(35,380)
(1,634)
(3,472)
(2,997)
Notes
29(i)
29(ii)
29(ii)
26(i)
10
Net cash in/(out)flow from operating activities
198,488
152,791
85,867
76,181
Cash flows from investing activities
Purchase of property, plant and equipment
11
(222,135)
(103,051)
(109,858)
(37,394)
Proceeds from disposal assets
2,819
-
-
124
Net cash outflow from investing activities
(219,316)
(103,051)
(109,858)
(37,270)
Cash flows from financing activities
Proceeds from borrowings
Principal repayments of borrowings
Principal elements of lease payments
29(ii)
29(ii)
29(ii)
722,995
669,619
722,995
669,619
(526,205)
(740,611)
(526,205)
(740,611)
(14,965)
(30,879)
(7,322)
(14,163)
Net cash in/(out)flow from financing activities
181,825
(101,871)
189,468
(85,155)
Net increase/(decrease) for the year
160,997
(52,131)
165,303
(46,244)
Movement in cash and cash equivalents
At start of year
Net increase /(decrease)
Exchange differences
(288,665)
(236,909)
(193,224)
(158,177)
160,997
(52,131)
165,303
(40)
375
45
(46,244)
11,197
At year end
19
(127,708)
(288,665)
(27,876)
(193,224)
The notes on pages 43 to 97 are an integral part of these annual financial statements.
42
Annual Report 2022Zambeef Products PLC Notes to annual financial statements
For the year ended 30 September 2022
1 General information
Zambeef Products PLC (the “Company”) is incorporated in Zambia under the Zambia Companies Act as a public limited company,
listed on the Lusaka Stock Exchange and is domiciled in Zambia. The Company and its subsidiaries (together “the Group”) is one
of the largest agri-businesses in Zambia. The Group is principally involved in the production, processing, distribution and retailing
of beef, chicken, pork, milk, dairy products, eggs, edible oils, stock feed and flour.
The Group also has large row cropping operations (principally maize, soya beans and wheat), with approximately 12,257 Hectares
of row crops under irrigation and 8,780 Hectares of rain-fed/dry-land crops available for planting each year. The Group also has
operations in West Africa in Nigeria and Ghana.
The Group’s registered office is:
Plot 4970, Manda Road
Industrial Area
Lusaka
Zambia
2 Summary of significant accounting policies
This note provides a list of the significant accounting policies adopted in the preparation of these annual financial statements to
the extent they have not already been disclosed in the other notes above. These policies have been consistently applied to all the
years presented, unless otherwise stated. The annual financial statements are for the Group consisting of Zambeef Products PLC
and its subsidiaries.
a) Basis of preparation
Compliance with IFRS
The annual financial statements of the Group have been prepared in accordance with International Financial Reporting Standards
(IFRS) and interpretations issued by the IFRS Interpretations Committee (IFRS IC) applicable to companies reporting under IFRS. The
annual financial statements comply with IFRS as issued by the International Accounting Standards Board (IASB).
Historical cost convention
The annual financial statements have been prepared on historical cost basis, except where otherwise stated in the accounting
policies below. The annual financial statements are presented in Zambia Kwacha (K). Where necessary, comparative figures have
been adjusted to conform to changes in presentation in the current period.
In accordance with the Companies Act, 2017 of Zambia, the annual financial statements for the year ended 30 September 2022 have
been approved for issue by the Directors.
The preparation of annual financial statements in conformity with IFRS requires the use of estimates and assumptions. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving
higher degree of judgement or complexity, or where assumptions and estimates are significant to the annual financial statements
are disclosed in Note 3.
i) New and amended standards adopted by the Group
The Group has adopted the applicable new, revised or amended accounting pronouncements as issued by the International and
Accounting Standards Board (IASB), which were effective for the Group from 1 October 2021.
The amendments to accounting standards below effective for the reporting period 1 October 2021 did not have any material impact
on the Group’s accounting policies and required no retrospective adjustments to the annual financial statements of the Group.
Amendments to IFRS 9 ‘Financial Instruments’, IAS 39 ‘Financial Instruments: Recognition and Measurement’, IFRS 7 ‘Financial
Instruments: Disclosures’, IFRS 4 ‘Insurance Contracts’ and IFRS 16 ‘Leases’ – interest rate benchmark (IBOR) reform (Phase 2).Annual
periods beginning on or after 1 January 2021 (Published August 2020).The Phase 2 amendments address issues that arise from the
implementation of the reform of an interest rate benchmark, including the replacement of one benchmark with an alternative one.
IFRS 16, ‘Leases’ COVID-19-Related Rent Concessions Amendment. Annual periods beginning on or after 1 June 2020 (early adoption
is permitted) (Published June 2020).The IASB has provided lessees (but not lessors) with relief in the form of an optional exemption
from assessing whether a rent concession related to COVID-19 is a lease modification, provided that the concession meets certain
conditions. Lessees can elect to account for qualifying rent concessions in the same way as they would if they were not lease
modifications. In many cases, this will result in accounting for the concession as a variable lease payment.
ii) New and amended standards not yet adopted by the Group
Certain new accounting standards and interpretations have been published that are not mandatory for 30 September 2022 reporting
periods and have not been early adopted by the Group. These standards are not expected to have a material impact on the entity in
the current or future reporting periods and on foreseeable future transactions.
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Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
ii) New and amended standards not yet adopted by the Group (continued)
Amendment to IFRS 3, ‘Business combinations’ Asset or liability in a business combination clarity. Annual periods beginning on or
after 1 January 2022 (Published May 2020) The Board has updated IFRS 3, 'Business combinations', to refer to the 2018 Conceptual
Framework for Financial Reporting, in order to determine what constitutes an asset or a liability in a business combination.
In addition, the Board added a new exception in IFRS 3 for liabilities and contingent liabilities. The exception specifies that, for some
types of liabilities and contingent liabilities, an entity applying IFRS 3 should instead refer to IAS 37, ‘Provisions, Contingent Liabilities
and Contingent Assets’, or IFRIC 21, ‘Levies’, rather than the 2018 Conceptual Framework.
The Board has also clarified that the acquirer should not recognise contingent assets, as defined in IAS 37, at the acquisition date.
Amendments to IAS 16 ‘Property, Plant and Equipment’: Proceeds before Intended Use. Annual periods beginning on or after 1 January
2022 (Published May 2020).The amendment to IAS 16 prohibits an entity from deducting from the cost of an item of PPE any
proceeds received from selling items produced while the entity is preparing the asset for its intended use (for example, the
proceeds from selling samples produced when testing a machine to see if it is functioning properly). The proceeds from selling
such items, together with the costs of producing them, are recognised in profit or loss.
Amendments to IAS 37 ‘Provisions, Contingent Liabilities and Contingent Assets’ on Onerous Contracts—Cost of Fulfilling a Contract.
Annual periods beginning on or after 1 January 2022 (Published May 2020). The amendment clarifies which costs an entity includes
in assessing whether a contract will be loss-making. This assessment is made by considering unavoidable costs, which are the
lower of the net cost of exiting the contract and the costs to fulfil the contract. The amendment clarifies the meaning of ‘costs to
fulfil a contract’. Under the amendment, costs to fulfil a contract include incremental costs and the allocation of other costs that
relate directly to fulfilling the contract.
Annual improvements cycle 2018 -2020. Annual periods beginning on or after 1 January 2022
(Published May 2020).
These amendments include minor changes to:
•
•
•
IFRS 1, ‘First time adoption of IFRS’ has been amended for a subsidiary that becomes a first-time adopter after its parent. The
subsidiary may elect to measure cumulative translation differences for foreign operations using the amounts reported by the
parent at the date of the parent’s transition to IFRS;
IFRS 9, ‘Financial Instruments’ has been amended to include only those costs or fees paid between the borrower and the
lender in the calculation of “the 10% test” for derecognition of a financial liability. Fees paid to third parties are excluded from
this calculation;
IFRS 16, ‘Leases’, amendment to the Illustrative Example 13 that accompanies IFRS 16 to remove the illustration of payments
from the lessor relating to leasehold improvements. The amendment intends to remove any potential confusion about the
treatment of lease incentives.
Amendment to IAS 1 ‘Presentation of Financial Statements’ on Classification of Liabilities as Current or Non-current. Annual periods
beginning on or after 1 January 2022. (Published Jan 2020). The amendment clarifies that liabilities are classified as either current or
non-current, depending on the rights that exist at the end of the reporting period. Classification is unaffected by expectations of the
entity or events after the reporting date (for example, the receipt of a waiver or a breach of covenant).
b) Principles of consolidation and equity accounting
i) Subsidiaries
Subsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity where the
Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns
through its power to direct the activities of the entity. Subsidiaries are fully consolidated from the date on which control is transferred
to the Group. They are deconsolidated from the date that control ceases. The acquisition method of accounting is used to account
for business combinations by the Group
Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised
losses are also eliminated unless the transaction provides evidence of an impairment of the transferred asset. Accounting policies
of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.
Non-controlling interests in the results and equity of subsidiaries are shown separately in the statement of profit or loss and other
comprehensive income, statement of changes in equity and statement of financial position respectively.
b) Principles of consolidation and equity accounting (continued)
ii) Associates
Associates are all entities over which the Group has significant influence but not control or joint control. This is generally the case
where the Group holds between 20% and 50% of the voting rights. Investments in associates are accounted for using the equity
method of accounting after initially being recognised at cost.
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Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
iii) Equity method
Under the equity method of accounting, the investments are initially recognised at cost and adjusted thereafter to recognise the
Group’s share of the post-acquisition profits or losses of the investee in profit or loss, and the Group’s share of movements in
other comprehensive income of the investee in other comprehensive income. Dividends received or receivable from associates
are recognised as a reduction in the carrying amount of the investment.
Where the Group’s share of losses in an equity-accounted investment equals or exceeds its interest in the entity, including any
other unsecured long-term receivables, the Group does not recognise further losses, unless it has incurred obligations or made
payments on behalf of the other entity.
Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in these
entities. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.
Accounting policies of equity-accounted investees have been changed where necessary to ensure consistency with the policies
adopted by the Group.
The carrying amount of equity-accounted investments is tested annually for impairment, or more frequently if events or changes
in circumstances indicate that they might be impaired.
iv) Changes in ownership interests
The Group treats transactions with non-controlling interests that do not result in a loss of control as transactions with equity
owners of the Group. A change in ownership interest results in an adjustment between the carrying amounts of the controlling and
non-controlling interests to reflect their relative interests in the subsidiary. Any difference between the amount of the adjustment
to non-controlling interests and any consideration paid or received is recognised in a separate reserve within equity attributable
to owners of Zambeef Products PLC.
When the Group ceases to consolidate or equity account for an investment because of a loss of control or significant influence,
any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognised in profit or loss.
This fair value becomes the initial carrying amount for the purposes of subsequently accounting for the retained interest as an
associate 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
If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts
previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.
c) Business combinations
The acquisition method of accounting is used to account for all business combinations, regardless of whether equity instruments
or other assets are acquired. The consideration transferred for the acquisition of a subsidiary comprises the:
•
•
•
•
•
fair values of the assets transferred;
liabilities incurred to the former owners of the acquired business;
equity interests issued by the Group;
fair value of any asset or liability resulting from a contingent consideration arrangement, and;
fair value of any pre-existing equity interest in the subsidiary
Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are, with limited
exceptions, measured initially at their fair values at the acquisition date. The Group recognises any non-controlling interest in the
acquired entity on an acquisition-by-acquisition basis either at fair value or at the non-controlling interest’s proportionate share of
the acquired entity’s net identifiable assets.
Acquisition-related costs are expensed as incurred.
The excess of the:
•
•
•
consideration transferred,
amount of any non-controlling interest in the acquired entity, and
acquisition-date fair value of any previous equity interest in the acquired entity
over the fair value of the net identifiable assets acquired is recorded as goodwill. If those amounts are less than the fair value of
the net identifiable assets of the business acquired, the difference is recognised directly in profit or loss as a bargain purchase.
Where settlement of any part of cash consideration is deferred, the amounts payable in the future are discounted to their present
value as at the date of exchange. The discount rate used is the entity’s incremental borrowing rate, being the rate at which a similar
borrowing could be obtained from an independent financier under comparable terms and conditions.
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Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
Contingent consideration is classified either as equity or a financial liability. Amounts classified as a financial liability are
subsequently remeasured to fair value, with changes in fair value recognised in profit or loss.
If the business combination is achieved in stages, the acquisition date carrying value of the acquirer’s previously held equity
interest in the acquiree is remeasured to fair value at the acquisition date. Any gains or losses arising from such remeasurement
are recognised in profit or loss.
d) Impairment of non-financial assets
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for
impairment, or more frequently if events or changes in circumstances indicate that they might be impaired. Other assets are
tested for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable.
An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The
recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows which are largely
independent of the cash inflows from other assets or groups of assets (cash-generating units). Non-financial assets other than
goodwill that suffered an impairment are reviewed for possible reversal of the impairment at the end of each reporting period.
e) Segment reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision
maker (CODM). The Board of Zambeef Products PLC has appointed a strategic steering committee which assesses the financial
performance and position of the Group and makes strategic decisions. The steering committee, which has been identified as
being the CODM, consists of the Chief Executive Officer and the Chief Financial Officer.
f) Foreign currency translation
i) Functional and presentation currency
Items included in the annual financial statements of each of the Group’s entities are measured using the currency of the primary
economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in
Zambian Kwacha (K), which is Zambeef Products PLC’s functional and presentation currency.
ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates at the dates of the transactions.
Foreign exchange gains and losses resulting from the settlement of such transactions, and from the translation of monetary assets
and liabilities denominated in foreign currencies at year end exchange rates, are recognised in profit or loss. They are deferred in
equity if they are attributable to part of the net investment in a foreign operation.
Foreign exchange gains and losses that relate to borrowings are presented in the statement of profit or loss, within finance costs. All
other foreign exchange gains and losses are presented in the statement of profit or loss on a net basis within other income or other
expenses.
Translation differences arising on Mpongwe Farms, whose assets and liabilities are denominated in US Dollars are posted in other
comprehensive income. In December 2021, management aligned the functional currency of Mpongwe Farms to that of Zambeef
Products PLC as the farm is a direct and integral extension of the reporting entity.
iii) Group companies
The results and financial position of foreign operations (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:
• 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 statement of profit or loss and statement of comprehensive income are translated at average
exchange rates (unless this 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 dates of the transactions), and;
• all resulting exchange differences are recognised in other comprehensive income
On consolidation, exchange differences arising from the translation of any net investment in foreign entities, and of borrowings
are recognised in other comprehensive income. When a foreign operation is sold or any borrowings forming part of the net
investment are repaid, the associated exchange differences are reclassified to profit or loss, as part of the gain or loss on sale.
g) Revenue recognition
The Group’s contracts with customers exist in various forms and typically take the form of signed agreements, approved customer
purchase orders, invoices to customers, terms and conditions documents and customary business practices, all of which have
commercial substance and impact the Company’s future cash flows. Revenue is recognised at point in time upon delivery of products
and customer acceptance. A receivable is recognised when the goods are delivered as this is the point in time that the consideration
is unconditional because only the passage of time is required before the payment is due.
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Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
Retailing and food production
The cold food chain products are mainly beef, chicken, pork, fish, milk and dairy products. These products are sold through the
Group’s retail network, most of which is through cash sales. The credit sales are only invoiced when the products are delivered to
the customer or when the customer collects the products. Revenue is recognised at point in time when performance obligations are
satisfied by delivering the products.
Stockfeed is sold through the Group’s retail network and on contract to certain customers. The sales through the retail network are
cash sales. The credit sales are invoiced when the customer takes delivery of the stock feed. Revenue is recognised at point in time
when performance obligations are satisfied by delivering the stockfeed.
Revenue for the sale of day-old chicks is generated through direct sales to customers through the Zambeef outlets and through
agents. Customers and agents make advance payments before getting delivery of the chicks. Revenue is recognised when the
customer collects the chicks and is invoiced. A contract liability is reconginsed for all amounts received in advance for which the
performance obligation of transferring the goods to the customer has not been met.
Cropping and milling
Revenue from cropping is from the sale of wheat, soya and maize grain. The price of the grain is agreed as per the contract with the
customers and the customers are only invoiced when customer takes delivery of the grain. Revenue is recognised at point in time
when performance obligations are satisfied by delivering the grain.
The flour mill and bread are sold through the Group’s retail network and are mainly for cash sales. Revenue is recognised at point in
time upon accptance of products by the customer.
Financing components
The Group does not expect to have any contracts where the period between the transfer of the promised goods or services to the
customer and payment by the customer exceeds one year. As a consequence, the Group does not adjust any of the transaction prices
for the time value of money.
h) Interest income
Interest income is presented as finance income where it is earned from financial assets that are held for cash management purposes.
Any other interest income is included in other income. Interest income is recognised using the effective interest method.
i) Property, plant and equipment
All items of property, plant and equipment are initially recognised at cost and subsequently shown at fair value, based on valuations
by external independent valuers, less accumulated depreciation. Valuations are performed with sufficient regularity to ensure that the
fair value does not differ materially from its carrying amount. Any accumulated depreciation at the date of revaluation is eliminated
against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.
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. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs
and maintenance are charged to profit or loss during the reporting period in which they are incurred.
Increases in the carrying amounts arising on revaluation of property, plant and equipment are recognised, net of tax, in other
comprehensive income and accumulated in reserves in shareholders’ equity. To the extent that the increase reverses a decrease
previously recognised in profit or loss, the increase is first recognised in profit or loss. Decreases that reverse previous increases of
the same asset are first recognised in other comprehensive income to the extent of the remaining surplus attributable to the asset; all
other decreases are charged to profit or loss. Each year, the difference between depreciation based on the revalued carrying amount
of the asset charged to profit or loss and depreciation based on the asset’s original cost, net of tax, is reclassified from the property,
plant and equipment revaluation surplus to retained earnings
Depreciation is calculated using the straight-line method to allocate the cost or revalued amounts of the assets, net of their residual
values, over their estimated useful lives as follows:
Buildings
Plant & machinery
Motor vehicles
Plant & machinery
Aircraft
Land
2%
10%
20%
10%
10%
Unexpired remaining life
Assets classified as land are not depreciated.
47
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
Capital work in progress, which represents additions to property, plant and equipment that have not yet been brought into use, is
not depreciated. Additions are transferred into the above depreciable asset classes once they are brought into use. Capital work in
progress is measured at cost less impairments.
The asset’s residual values and useful lives of the assets are reviewed, and adjusted if appropriate, at the end of each reporting
period.
Property, plant and equipment are reviewed for impairment whenever events or changes in circumstances indicate that the carrying
amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds
its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell, and value in use. For the
purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows
(cash-generating units).
Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in profit or loss.
When revalued assets are sold, it is Group policy to transfer any amounts included in other reserves in respect of those assets to
retained earnings.
j) Leases
The following sets out the Group’s lease accounting policy for all leases with the exception of leases with low-value and short term of
less than 12 months for which the Group has taken the exemption under the standard and are expensed to profit or loss as incurred.
i) Right of use assets
The Group recognises right of use assets at the commencement date of the lease (i.e., the date the underlying asset is available for
use under the contract). Right of use assets are measured at cost, less any accumulated depreciation and impairment losses, and
adjusted for any remeasurement of lease liabilities.
The cost of right of use assets includes the amount of lease liabilities recognised, initial direct costs incurred, and lease payments
made at or before the commencement date (which do not form part of the lease liability value at the commencement date).
Right of use assets are depreciated on a straight-line basis over the shorter of their estimated useful life and the lease term.
Buildings
Plant & machinery
Motor vehicles
10 years
10 years
4 years
Lease term
Lease term
Lease term
The right-of-use assets are tested for impairment in accordance with IAS 36 “Impairment of Assets”.
ii) Lease liabilities
At the commencement date of the lease, the group recognises lease liabilities measured at the present value of all remaining lease
payments to be made over the lease term. The lease payments include fixed payments (including in-substance fixed payments where
the contracts specify fixed or minimum uplifts) and variable lease payments that depend on an index or a rate.
The variable lease payments that do not depend on an index or a rate are recognized as an expense in the period in which the event
or condition that triggers the payment occurs. Due to the nature of the leased assets the interest rate implicit in the lease is usually
not readily determinable, the Group therefore uses the incremental borrowing rate in calculating the present value of lease payments
at the lease commencement date.
The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the
remaining balance of the liability for each period. In addition, the carrying amount of lease liabilities is remeasured if there is a
modification, a change in the lease term or a change in the in-substance fixed lease payments.
k) Goodwill
Goodwill is measured as described in Note (c). Goodwill is not amortised but it is tested for impairment annually, or more frequently
if events or changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated impairment losses.
Gains and losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. The allocation is made to those cash-generating
units or groups of cash-generating units that are expected to benefit from the business combination in which the goodwill arose. The
units or groups of units are identified at the lowest level at which goodwill is monitored for internal management purposes, being the
operating segments.
l) Biological assets
Biological assets are measured at fair value less cost to sell, based on market prices at auction of livestock of similar age, breed
and genetic merit, with adjustments, where necessary, to reflect the differences. Costs to sell include the incremental selling costs,
including auctioneers’ fees, commission paid to brokers and dealers, and estimated costs of transport to the market, but exclude
finance costs and income taxes.
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Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
Changes in fair value of livestock and growing crop are recognised in profit or loss. Farming costs such as feeding, labour costs,
pasture maintenance, veterinary services and shearing are expensed as incurred. The cost of purchase of sheep plus transportation
charges are capitalised as part of biological assets.
Cattle and Pigs are measured at fair value based on market prices of similar age, breed and genetic merit, with adjustments, where
necessary, to reflect the differences. Market prices are obtained from local active market. Cattle and Pigs are classified as current
assets if they are to be sold within one year.Standing crops (Maize, Soya and Wheat) are measured at fair value at each reporting date
based on the estimated market value of fully grown standing crops adjusted for the age and condition of the crops at the reporting
date.
The cost model is adopted for the measurement of Chickens and agricultural produce (parent breeding stock, commercial layers, set
eggs and unset eggs) as the fair values cannot be reliably measured. Breeding stock and commercial layers are capitalized at cost at
the beginning of their productive cycleand amortised on a straight-line method over the anticipated productive cycle, to its estimated
net realizable value. All the expenses incurred in establishing and maintaining the assets are recognized in cost of sales. All costs
incurred in acquiring biological assets until point of production are capitalised.
Set and unset eggs are measured on costs with expenses incurred in maintaining the assets included within “cost of sales” in profit
or loss for the period in which they arise.
m) Inventories
Raw materials and stores, work in progress and finished goods are stated at the lower of cost and net realisable value. Cost comprises
direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on
the basis of normal operating capacity. Costs are assigned to individual items of inventory on the basis of first in first out. Costs of
purchased inventory are determined after deducting rebates and discounts. Net realisable value is the estimated selling price in the
ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.
n) Financial instruments
Financial assets and liabilities are recognised in the Group’s statement of financial position when the Group becomes a party to the
contractual provisions of the instruments.
Classification and measurement
Financial assets
The classification depends on the entity’s business model for managing the financial assets and the contractual terms of the cash
flows. The group reclassifies debt investments when and only when its business model for managing those assets changes. At initial
recognition, the Group measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit
or loss (FVPL), transaction costs that are directly attributable to the acquisition of the financial asset. Transaction costs of financial
assets carried at FVPL are expensed in profit or loss.
Subsequent measurement of debt instruments depends on the Group’s business model for managing the asset and the cash flow
characteristics of the asset. The Group measures its debt instruments at amortised cost as assets are held for collection of contractual
cash flows where those cash flows represent solely payments of principal and interest. Interest income from these financial assets
is included in finance income using the effective interest rate method. The Group's financial assets are trade receivables and cash
and cash equivalents.
i) Trade and receivables
Trade receivables are recognised initially at the amount of consideration that is unconditional, unless they contain significant
financing components when they are recognised at fair value. They are subsequently measured at amortised cost using the effective
interest method, less loss allowance.
ii) Cash and cash equivalents
For the purpose of presentation in the statement of cash flows, cash and cash equivalents includes cash on hand, deposits held
at call with financial institutions, other short-term, highly liquid investments with original maturities of three months or less that are
readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and bank overdrafts.
Bank overdrafts are shown within borrowings in current liabilities in the statement of financial position.
Financial liabilities
The Group's financial liabilities are classified as amortised cost. Financial liabilities are recognised initially at fair value and inclusive
of directly attributable transaction costs. The Group's financial liabilities are borrowings and trade and other payables (excluding
statutory liabilities).
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Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
i) Borrowings
Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised
cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in profit or loss over
the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities are recognised as
transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn down. In this case, the fee is
deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn
down, the fee is capitalised as a prepayment for liquidity services and amortised over the period of the facility to which it relates.
Where the terms of a financial liability are renegotiated and the entity issues equity instruments to a creditor to extinguish all or part
of the liability (debt for equity swap), a gain or loss is recognised in profit or loss, which is measured as the difference between the
carrying amount of the financial liability and the fair value of the equity instruments issued.
Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at
least 12 months after the reporting period.
ii) Trade and other payables
These amounts represent liabilities for goods and services provided to the Group prior to the end of the financial year which are
unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. Trade and other payables are presented as
current liabilities unless payment is not due within 12 months after the reporting period. They are recognised initially at their fair value
and subsequently measured at amortised cost using the effective interest method.
Impairment
The Group assesses on a forward-looking basis the expected credit losses associated with its debt instruments carried at amortised
cost. The Group applies the simplified approach permitted by IFRS 9, which requires expected lifetime losses to be recognised from
initial recognition of the receivables. Refer to Note 4(b) for further details.
Derecognition
Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred
and the Group has transferred substantially all the risks and rewards of ownership.Any gain or loss arising on derecognition is
recognised directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses.The
Group derecognises financial liabilities when, and only when, the Group’s obligations are discharged, cancelled or have expired. The
difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised
in profit or loss.
Substantial modification
A substantial modification of the terms of an existing debt instrument or part of it is accounted for as an extinguishment of the
original debt instrument and the recognition of a new debt instrument. Gains or losses arising from the modification of the terms
of a debt instrument are recognised immediately in profit or loss where the modification does not result in the derecognition of the
existing instrument.
Offsetting financial instruments
Financial assets and liabilities are offset and the net amount reported in the statement of financial position when there is a legally
enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the
liability simultaneously. As at the reporting period, there were no assets and liabilities off-set relating to financial instruments. The
legally enforceable right is not contingent on future events and is enforceable in the normal course of business and in the event of
default, insolvency or bankruptcy of the Group or the counterparty.
o) Other current assets
These amounts generally arise from transactions outside the usual operating activities of the Group. Interest may be charged at
commercial rates where the terms of repayment exceed six months. Collateral is not normally obtained.
Prepayments are amounts paid in advance during the accounting period for an underlying asset that will be consumed in a future
period. When the asset is used or consumed, the prepayments are amortised, and costs are recognised in operating expenses.
Prepayments are stated at their nominal values in the financial statements.
p) Borrowings costs
General and specific borrowing costs that are directly attributable to the acquisition, construction or production of a qualifying asset
are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Qualifying
assets are assets that necessarily take a substantial period of time to get ready for their intended use or sale.
Investment income earned on the temporary investment of specific borrowings, pending their expenditure on qualifying assets, is
deducted from the borrowing costs eligible for capitalisation. Other borrowing costs are expensed in the period in which they are
incurred.
50
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
q) Non-current assets (or disposal groups) held for sale and discontinued operation
Non-current assets (or disposal groups) are classified as held for sale if their carrying amount will be recovered principally through
a sale transaction rather than through continuing use and a sale is considered highly probable. They are measured at the lower of
their carrying amount and fair value less costs to sell, except for assets such as deferred tax assets, assets arising from employee
benefits, financial assets and investment property that are carried at fair value and contractual rights under insurance contracts,
which are specifically exempt from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset (or disposal group) to fair value less costs
to sell. A gain is recognised for any subsequent increases in fair value less costs to sell of an asset (or disposal group), but not in
excess of any cumulative impairment loss previously recognised. A gain or loss not previously recognised by the date of the sale of
the noncurrent asset (or disposal group) is recognised at the date of derecognition.
Non-current assets (including those that are part of a disposal group) are not depreciated or amortised while they are classified as
held for sale. Interest and other expenses attributable to the liabilities of a disposal group classified as held for sale continue to be
recognised.
Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately
from the other assets in the statement of financial position. The liabilities of a disposal group classified as held for sale are presented
separately from other liabilities in the statement of financial position.
A discontinued operation is a component of the entity that has been disposed of or is classified as held for sale and that represents
a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to dispose of such a line of
business or area of operations, or is a subsidiary acquired exclusively with a view to resale. The results of discontinued operations
are presented separately in the statement of profit or loss.
r) Share capital and share premium
Ordinary shares are classified as share capital in equity. Mandatorily redeemable preference shares are classified as liabilities.
However, the Group classifies preference shares as equity as they do not meet the definition of a financial liabilities. Incremental
costs directly attributable to the issue of new shares or options are shown in equity as a deduction, net of tax, from the proceeds.
Any premium received over and above the par value of the shares is classified as share premium in equity. Incremental costs directly
attributable to the issue of new ordinary shares are shown in equity as deduction from the proceeds.
s) Earnings per share
i) Basic earnings per share
Basic earnings per share is calculated by dividing the profit attributable to owners of the Company, excluding any costs of servicing
equity other than ordinary shares by the weighted average number of ordinary shares outstanding during the financial year, adjusted
for bonus elements in ordinary shares issued during the year and excluding treasury shares.
ii) Diluted earnings per share
Diluted earnings per share adjusts the figures used in the determination of basic earnings per share to take into account the after-
income tax effect of interest and other financing costs associated with dilutive potential ordinary shares, and the weighted average
number of additional ordinary shares that would have been outstanding assuming the conversion of all dilutive potential ordinary
shares.
t) Employee benefits
i) Short term obligations
Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave that are expected to
be settled wholly within 12 months after the end of the period in which the employees render the related service are recognised in
respect of employees’ services up to the end of the reporting period and are measured at the amounts expected to be paid when
the liabilities are settled. The liabilities are presented as current employee benefit obligations in the statement of financial position.
ii) Post-employment obligations
The Group operates various post-employment schemes, including both defined contribution and benefit plans.
Defined contribution plan
The Group and all its employees pay contributions to the National Pension Scheme Authority (NAPSA), a publicly administered
pension scheme on a mandatory basis. The Group has no further payment obligations once the contributions have been paid. The
contributions are recognised as employee benefit expense when they are due. Prepaid contributions are recognised as an asset to
the extent that a cash refund or a reduction in the future payments is available.
51
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 2 Summary of significant accounting policies (continued)
t) Employee benefits (continued)
ii) Post-employment obligations (continued)
Defined benefit pension plan
The liability recognised in the statement of financial position in respect of defined benefit pension plans is the present value of
the defined benefit obligation at the end of the reporting period. The plan is unfunded. The defined benefit obligation is calculated
annually by independent actuaries using the projected unit credit method.
The present value of the defined benefit obligation is determined by discounting the estimated future cash outflows using interest
rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms
approximating to the terms of the related obligation. In countries where there is no deep market in such bonds, the market rates on
government bonds are used.
The net interest cost is calculated by applying the discount rate to the net balance of the defined benefit obligation. This cost is
included in employee benefit expense in the statement of profit or loss.
Remeasurement gains and losses arising from experience adjustments and changes in actuarial assumptions are recognised in
the period in which they occur, directly in other comprehensive income. They are included in retained earnings in the statement of
changes in equity and in the statement of financial position.
Changes in the present value of the defined benefit obligation resulting from plan amendments or curtailments are recognised
immediately in profit or loss as past service costs.
Termination benefits
Termination benefits are payable when employment is terminated by the Group before the normal retirement date, or when an
employee accepts voluntary redundancy in exchange for these benefits. The Group recognises termination benefits at the earlier of
the following dates: (a) when the Group can no longer withdraw the offer of those benefits; and (b) when the entity recognises costs
for a restructuring that is within the scope of IAS 37 and involves the payment of terminations benefits. In the case of an offer made
to encourage voluntary redundancy, the termination benefits are measured based on the number of employees expected to accept
the offer. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.
u) Income tax
The income tax expense or credit for the period is the tax payable on the current period’s taxable income, based on the applicable
income tax rate for each jurisdiction, adjusted by changes in deferred tax assets and liabilities attributable to temporary differences
and to unused tax losses.
The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the end of the reporting
period in the countries where the Group and its subsidiaries operate and generate taxable income. Management periodically evaluates
positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation and considers
whether it is probable that a taxation authority will accept an uncertain tax treatment. The Group measures its tax balances either
based on the most likely amount or the expected value, depending on which method provides a better prediction of the resolution of
the uncertainty.
Deferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets
and liabilities and their carrying amounts in the annual financial statements. However, deferred tax liabilities are not recognised if
they arise from the initial recognition of goodwill. Deferred income tax is also 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 and does not give rise to equal taxable and deductible temporary differences. Deferred income tax is
determined using tax rates (and laws) that have been enacted or substantively enacted by the end of the reporting period and are
expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled.
Deferred tax assets are recognised only if it is probable that future taxable amounts will be available to utilise those temporary
differences and losses.
Deferred tax liabilities and assets are not recognised for temporary differences between the carrying amount and tax bases of
investments in foreign operations where the Group is able to control the timing of the reversal of the temporary differences and it is
probable that the differences will not reverse in the foreseeable future.
Deferred tax assets and liabilities are offset where there is a legally enforceable right to offset current tax assets and liabilities and
where the deferred tax balances relate to the same taxation authority. Current tax assets and tax liabilities are offset where the
entity has a legally enforceable right to offset and intends either to settle on a net basis, or to realise the asset and settle the liability
simultaneously.
Current and deferred tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive
income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively.
52
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 3 Critical accounting estimates and judgements
The preparation of annual financial statements requires the use of accounting estimates which, by definition, will seldom equal
the actual results. Management also needs to exercise judgement in applying the Group’s accounting policies. Estimates and
judgements are continually evaluated. They are based on historical experience and other factors, including expectations of future
events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances.
The areas that involved a higher degree of judgement or complexity, and of items which are more likely to be materially adjusted
due to estimates and assumptions turning out to be wrong are as follows:
i) Estimated Goodwill impairment
The Group tests whether goodwill has suffered any impairment on an annual basis. The recoverable amount of the cash-generating
units (CGUs) is determined based on value-in-use calculations which require the use of assumptions. The calculations use cash
flow projections based on financial budgets approved by management covering a five-year period. Cash flows beyond the five-year
period are extrapolated using the estimated growth rates. These growth rates are consistent with forecasts included in industry
reports specific to the industry in which each CGU operates.
ii) Valuation of biological assets
In measuring the fair value of livestock and standing crop, various management estimates and judgements are required.
Estimates and judgements in determining the fair value of livestock relate to market prices, average weight and quality of animals,
and mortality rates. The livestock grow at different rates and there can be a considerable spread in the quality and weight of animals
that affects the price achieved. An average weight is assumed for the animals based on a sample deemed to be representative of
the total population per breed and genetic merit.
For standing crop, the most significant estimate relates to management’s assessment of anticipated yield per hectare and and
adjustment related to the crops rate of growth.This assessment considers historic yields, climate conditions and prices.
iii) Estimation of defined benefit obligation (DBO)
Management’s estimate of the DBO is based on a number of critical underlying assumptions such as standard rates of inflation,
mortality, discount rate and anticipation of future salary increases. Variation in these assumptions may significantly impact the DBO
amount and the annual defined benefit expenses amount.
iv) Impairment of financial assets
The loss allowances for financial assets are based on assumptions about risk of default and expected loss rates. The Group uses
judgement in making these assumptions and selecting the inputs to the impairment calculation, based on the Group’s past history and
existing market conditions, as well as forward-looking estimates at the end of each reporting period. Details of the key assumptions
and inputs used are disclosed in Note 4(b).
4 Financial risk management
The Group’s risk management is predominantly controlled by a central treasury department (group treasury) under policies
approved by the Board of Directors. Group treasury identifies, evaluates and hedges financial risks in close co-operation with the
Group’s operating units. The Board provides written principles for overall risk management, as well as policies covering specific
areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and non-derivative
financial instruments, and investment of excess liquidity.
The Group’s Board of Directors believes that the Group is well positioned in an improving economy. Factors contributing to the
Group’s strong position are:
•
•
•
Increase in the retail footprint of the Group;
Increase in production facilities of the Group, leading to higher volumes available for retail;
Improvements in the management team across various areas of the Group leading to positive reinforcement of strong
operational synergies.
Overall, the Group is in a strong position and has sufficient capital and liquidity to service its operating activities and debt.
a) Market risk
i) Foreign exchange risk exposure
Foreign exchange risk arises when recognised assets or liabilities are denominated in a currency that is not the entity’s functional
currency.
The Group is exposed to foreign currency risk arising from various currency exposures, primarily with respect to the United States
Dollar (US$). These risks are minimised by matching the foreign currency receipts to the foreign currency payments as well as
holding foreign currency bank accounts and export sales.
53
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
The Group’s exposure to foreign currency risk, primarily with respect to the United States Dollar (US$), at the end of the reporting
period, expressed in Zambian Kwacha is detailed in the table below.
As at 30 September 2022
Financial assets:
Cash and cash equivalents
Trade and other receivables
Financial liabilities:
Bank overdrafts
Bank loans
Trade and other payable
Lease liabilities
Net exposure
As at 30 September 2021
Financial assets:
Cash and cash equivalents
Trade and other receivables
Financial liabilities:
Bank overdrafts
Bank loans
Trade and other payables
Lease liabilities
Net exposure
Sensitivity
Group
US$
K’000
2,658
75,841
78,499
(11,577)
(24,754)
(88,858)
(7,127)
(132,316)
(53,817)
76,631
151,824
228,455
(83,234)
(82,133)
(276,122)
(12,959)
(454,448)
(225,993)
Company
US$
K’000
1,801
57,493
59,294
(11,561)
(24,754)
(88,858)
(7,127)
(132,300)
(73,006)
23,807
45,270
69,077
(83,234)
(82,133)
(191,899)
(12,959)
(370,225)
(301,148)
At 30 September 2022, if the Zambian Kwacha had weakened/strengthened by 10% (2021: 10%) against the United States Dollar
(US$) with all other variables held constant, the effect on post-tax profit for the year and shareholders' equity would have been as
follows:
Impact on profit and equity
Group
Company
2022
K’000
85,030
2021
K’000
136,725
2022
K’000
115,350
2021
K’000
12,397
54
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
a) Market risk (continued)
ai) Cash flow and fair value Interest rate risk
The Group’s main interest rate risk arises from borrowings with variable rates, which expose the Group to cash flow interest rate
risk. To manage the risks, the Group structures its debt with low spreads over the variable rate benchmark and protects itself with
matching fixed interest rates on its borrowings. Management periodically reviews economic conditions relating to such variable
benchmarks and is allowed to consider alternate debt structures where the need may arise.
The exposure of the Group’s borrowings to interest rate changes at the end of the reporting period are as follows:
Group
Variable rate borrowings
647,547
68%
896,468
100%
2022
K’000
% of total loans
2021
K’000
% of total loans
Company
Variable rate borrowings
459,891
60%
712,681
100%
The percentage of total loans shows the proportion of loans that are currently at variable rates in relation to the total amount of
borrowings.
As at 30 September 2022, with all other variables held constant, a 5 % (2021: 5%) decrease/increase in the base interest rate
would have resulted in change in post-tax profit for the year and shareholders' equity as follows:
Impact on profit and equity
IBOR reforms
Group
Company
2022
K’000
47,577
2021
K’000
44,823
2022
K’000
38,194
2021
K’000
35,634
During the year, the Group repaid all outstanding loans and renewed both short-term working capital facilities and long-term debt
based on the SOFR rate. There were no long-term facilities transitioned from LIBOR to SOFR to warrant an assessment of debt
modifications or extinguishments.
bi) Price risk
The Group does not hold any financial instruments subject to price risk (2021: Nil).
b) Credit risk
Credit risk is the risk that a counterparty will default on its contractual obligations resulting in financial loss to the Group. Credit
risk arises from cash and cash equivalents and deposits with banks and financial institutions, as well as credit exposures to
outstanding receivables.
i) Risk management
For banks and financial institutions, the Group only accepts reputable well-established financial institutions. Through selective
granting of credit, the Group’s risk control unit assesses the credit quality of the customer, taking into account its financial
position, past experience and other factors. The Group does not grade the credit quality of receivables. Individual risk limits are
set based on internal ratings in accordance with limits set by the Board. The utilisation of credit limits is regularly monitored.
Sales to retail customers are required to be settled in cash mitigating credit risk. There are no significant concentrations of
credit risk, whether through exposure to individual customers, specific industry sectors and/or regions. The Directors believe
the credit risk of trade receivables is low.
ii) Security
The Group does not obtain security on outstanding trade receivables
iii) Impairment of financial assets
The Group has three types of financial assets that are subject to the expected credit loss model:
•
trade receivables
• Cash and cash equivalents
• Other financial assets at amortised cost
55
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
b) Credit risk (continued)
Trade receivables
The Group applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss
allowance for all trade receivables. To measure the expected credit losses, trade receivables have been grouped based on
shared credit risk characteristics and the days past due. The Group’s historical credit loss experience does not show significantly
different loss patterns for the various customer segments. Therefore, the grouping of trade receivables is not disaggregated into
further risk profiles other than days past due.
The expected loss rates are based on the payment profiles of sales over a period of 12 months before 30 September 2022 and
the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current
and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.
The Group has identified the inflation and interest rates of the countries in which it sells its goods and services to be the most
relevant factors, and accordingly adjusts the historical loss rates based on expected changes in these factors.
The outstanding trade receivables subjected to expected credit loss calculation are net of debtors where there is a legal right
to offset.
There were no changes in the estimation techniques or significant assumptions made as at the reporting period. The amount
that best represents the Company’s maximum exposure to credit risk is the carrying value of its financial assets as presented in
the statement of financial position.
On that basis, the loss allowance as at 30 September 2022 and 30 September 2021 was determined as follows for trade
receivables:
30 September 2022
Group
Gross carrying amount
Right to offset balances
Expected loss rate
Loss allowance
Other allowance
Amortised cost
Company
Gross carrying amount
Right to offset balances
Expected loss rate
Loss allowance
Other allowance
Amortised cost
30 September 2021
Group
Gross carrying amount
Expected loss rate
Loss allowance
Amortised cost
Company
Gross carrying amount
Expected loss rate
Loss allowance
Amortised cost
Current
K’000
120,034
(16,667)
103,367
5.0%
(5,168)
(13,767)
84,432
46,112
(16,667)
29,445
7%
(2,061)
(6,281)
21,103
Current
K’000
137,825
3.96%
(5,456)
132,369
74,056
0.3%
(222)
73,834
31 -60
days past due
K’000
5,871
-
5,871
7.0%
(411)
-
5,460
61 – 90
days past due
K’000
793
-
793
61%
(484)
-
309
Over 90
days past due
K’000
10,867
-
10,867
90%
(9,780)
-
1,087
2,072
-
2,072
26%
(539)
-
1,533
220
-
220
100%
(220)
-
-
5,387
-
5,387
100%
(5,387)
-
-
31 -60
days past due
K’000
20,830
3.55%
(740)
61 – 90
days past due
K’000
1,784
7.06%
(126)
Over 90
days past due
K’000
6,026
89.99%
(5,421)
Total
K’000
137,565
(16,667)
120,898
(15,843)
(13,767)
91,288
53,791
(16,667)
37,124
(8,207)
(6,281)
22,636
Total
K’000
166,465
(11,743)
20,090
1,658
605
154,722
15,397
3.0%
(461)
14,936
101
11.0%
(11)
90
5,843
92.0%
(5,369)
474
The loss allowances for trade receivables as at 30 September reconcile to the opening loss allowances as follows:
At start of year
Charge recognised in profit or loss
Utilised
56
Group
2022
K’000
11,743
17,869
-
29,612
2021
K’000
10,723
3,306
(2,286)
11,743
Company
2022
K’000
6,603
7,876
-
14,479
95,397
(6,063)
89,334
2021
K’000
5,298
1,188
(423)
6,063
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
b) Credit risk (continued)
Trade receivables are written off where there is no reasonable expectation of recovery. Indicators that there is no reasonable
expectation of recovery include, amongst others, the failure of a debtor to engage in a repayment plan with the Group, and a
failure to make contractual payments for a period of greater than 90 days past due.
Impairment losses on trade receivables are presented as net impairment losses within operating profit. Subsequent recoveries
of amounts previously written off are credited against the same line item.
The loss allowance recognised is categorised as follows:
Performing debtors
Non-performing debtors - over 90 days
Cash and cash equivalents
Group
Company
2022
K’000
6,065
23,547
2021
K’000
6,322
5,421
29,612
11,743
2022
K’000
2,811
5,421
8,232
2021
K’000
1,234
5,369
6,063
While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was
immaterial.
Other financial assets at amortised cost
Other financial assets at amortised cost relate to receivables from related parties, staff debtors, and sundry debtors. All of the
Group’s other financial assets at amortised cost are considered to have a low risk of default and the debtors have a strong
capacity to meet their contractual cash flow obligations in the near term.
c) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. Prudent liquidity
risk management implies maintaining sufficient cash and marketable securities and the availability of funding through an
adequate amount of committed credit facilities to meet obligations when due and to close out market positions. Due to the
dynamic nature of the underlying businesses, Group treasury maintains flexibility in funding by maintaining availability under
committed credit lines.
Management monitors rolling forecasts of the group’s liquidity reserve (comprising the undrawn borrowing facilities below)
and cash and cash equivalents on the basis of expected cash flows. This is generally carried out at local level in the operating
companies of the Group, in accordance with practice and limits set by the Group. These limits vary by location to take into
account the liquidity of the market in which the entity operates.
In addition, the Group’s liquidity management policy involves projecting cash flows in major currencies and considering the
level of liquid assets necessary to meet these, monitoring financial position liquidity ratios against internal and external
regulatory requirements and maintaining debt financing plans.
57
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
c) Liquidity risk (continued)
i) Financing arrangements
The Group had access to the following undrawn borrowing facilities (Bank loans and overdrafts) at the end of the reporting
period:
Floating rate
Expiring within one year
Group
2022
K’000
2021
K’000
Company
2022
K’000
2021
K’000
384,764
257,857
572,420
441,644
The bank overdraft facilities may be drawn at any time and may be terminated by the bank without notice. Subject to the
continuance of satisfactory credit ratings, the bank loan facilities may be drawn at any time in in denominated currency and
have an average maturity of 1 years (2021:1 years).
ii)
Maturities of financial liabilities
The tables below analyse the Group’s financial liabilities into relevant maturity groupings based on their contractual maturities.
The amounts disclosed in the table are the contractual undiscounted cash flows. Balances due within 12 months equal their
carrying balances as the impact of discounting is not significant.
Less than 1
year
K’000
Between 1 and
2 years
K’000
Between
2 and 5 years
K’000
Over
5 years
Total
contractual
cash flows
At 30 September 2022
Group
Trade and other payables*
Borrowings
Lease liabilities
Company
Trade and other payables*
Borrowings
Lease liabilities
At 30 September 2021
Group
Trade and other payables*
Borrowings
Lease liabilities
Company
Trade and other payables*
Borrowings
Lease liabilities
612,842
598,871
7,094
1,218,807
362,760
384,943
5,790
753,493
496,359
397,456
13,085
906,900
388,273
382,873
6,945
778,091
-
55,732
6,453
62,185
-
55,732
5,225
60,957
-
122,456
5,434
127,890
-
106,737
3,159
109,896
-
430,161
5,791
435,952
-
430,161
-
430,161
-
-
1,563
1,563
-
-
-
-
-
7,991
7,991
-
-
-
-
-
-
3,345
3,345
-
-
-
612,842
1,084,764
27,329
1,724,935
362,760
870,836
11,015
1,244,611
496,359
519,912
23,427
1,039,698
388,273
489,610
10,104
887,987
*Trade and other payables exclude statutory liabilities as these are imposed by law and therefore do not meet the definition of
financial instruments.
58
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
d) Agricultural risk
Agricultural production by its nature contains elements of significant risks and uncertainties which may adversely affect the
business and operations of the Group, including but not limited to the following:
• any future climate change with a potential shift in weather patterns leading to floods or droughts and associated crop losses;
• potential insect, fungal and weed infestations resulting in crop failure and reduced yields;
• wild and domestic animal conflicts and crop raiding and;
•
livestock disease outbreaks. Adverse weather conditions represent a significant operating risk to the business, affecting the
quality and quantity of production and the levels of farm inputs.
The Group minimises these risks through a robust insurance policy on biological stock (crop and livestock) and grain inventory.
e) Capital risk management
The Group’s objectives when managing capital are to safeguard their ability to continue as a going concern, so that they can
continue to provide returns for shareholders and benefits for other stakeholders and maintain an optimal capital structure to
reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends
paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.
Consistent with others in the industry, the Group monitors capital on the basis of the gearing ratio which is calculated as Net
debt divided by Total ‘equity’ (as shown in the statement of financial position).
During 2022, the Group’s strategy, which was unchanged from prior year, was to maintain a gearing ratio of less than 70%.The
gearing ratio is not part of the contractual debt covenants imposed by the lenders. Therefore, there is no adverse financing
implications on the Group in the event that the ratio deteriorates. The gearing ratios at 31 December 2022 and 31 December
2021 were as follows:
Net debt (Note 29 (ii))
Total equity attributable to parent
Group
Company
2022
K’000
745,217
3,693,331
2021
K’000
714,600
3,688,361
2022
K’000
637,978
3,268,010
2021
K’000
607,958
3,340,829
Gearing ratio
20%
20%
19%
19%
59
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
f) Fair value measurements
This note explains the judgements and estimates made in determining the fair values of the non-financial assets and liabilities
that are recognised and measured at fair value in the financial statements. As at the end of the reporting period, the Group had
no financial instruments measured at fair value. To provide an indication about the reliability of the inputs used in determining
fair value, the Group has classified its non-financial assets and liabilities into the three levels prescribed under the accounting
standards as below:
• Level 1: The fair value of non-financial instruments traded in active markets is based on quoted market prices at the end of the
reporting period;
• Level 2: The fair value of non-financial instruments that are not traded in an active market is determined using valuation
techniques that maximise the use of observable market data and rely as little as possible on entity-specific estimates. If all
significant inputs required to fair value an instrument are observable, the instrument is included in level 2;
• Level 3: If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.
At 30 September 2022
Group
Non-financial assets:
Property plant and equipment
Biological assets
Company
Non-financial assets:
Property plant and equipment
Biological assets
At 30 September 2021
Group
Non-financial assets:
Property plant and equipment
Biological assets
Company
Non-financial assets:
Property plant and equipment
Biological assets
Level 1
K’000
Level 2
K’000
Level 3
K’000
Total
K’000
-
-
-
-
-
-
-
-
-
-
-
-
-
320,699
3,134,611
-
3,134,611
320,699
320,699
3,134,611
3,455,310
-
269,652
2,158,021
-
2,158,021
269,652
269,652
2,158,021
2,427,673
358,997
3,071,735
-
3,071,735
358,997
358,997
3,071,735
3,430,732
307,754
2,158,613
-
2,158,613
307,754
307,754
2,158,613
2,466,367
There were no transfers between the levels for recurring fair value measurements during the year.
60
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
4 Financial risk management (continued)
f) Fair value measurements (continued)
Property, plant and equipment
Level 3 fair values were derived using comparable value of similar items of property, plant and equipment and adjusted for
differences in key attributes such as property size and condition. Depreciated replacement cost approach was used for
specialized buildings, furniture and fittings, motor vehicles and office equipment.
The best evidence of fair value is current prices in an active market for similar properties. Where such information is not available
the directors consider information from a variety of sources including current prices in an active market for properties of a
different nature or recent prices of similar properties in less active markets, adjusted to reflect those differences.
Biological assets
Biological assets are measured at fair value less cost to sell. Refer to Note 3(ii) for further information on the inputs used in
determining the fair value.
g) Financial instruments by category
Financial assets at amortised cost
Trade and other receivables*
(excluding prepayments)
Cash and cash equivalents
Financial liabilities at amortised cost
Borrowings
Lease liabilities
Trade and other payables**
(excluding prepayments)
Group
2022
K’000
2021
K’000
Company
2022
K’000
2021
K’000
131,056
223,973
201,763
201,539
723,976
136,149
869,868
111,136
355,029
403,302
860,125
981,004
951,547
17,643
896,468
19,671
763,891
10,232
712,681
8,470
612,842
496,359
362,760
388,273
1,582,032
1,412,498
1,136,883
1,109,424
61
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
5 Segment reporting
The Group’s Chief Operating Decision Makers (CODMs), (consisting of the Chief Executive Officer and the Chief Financial
Officer), examine the Group’s performance from a product perspective and has identified two aggregated reportable segments
of its business as shown in the table below. The business activities are grouped in these segments based on the nature of their
products and services.
• Retailing and food production: This part of business sells cold food chain products are mainly beef, chicken, pork, fish, milk
and dairy products as well as sale of day-old chicks and stockfeed.
• Cropping and milling: This part of business sells wheat, soya and maize grain as well as flour mill and bread.
The individual segments ((beef, chicken, pork, fish, dairy products, day-old chicks and stockfeed) have been aggregated into
Retailing and food production as they have similar average gross margins and similar expected growth rates. The same
applies to the Cropping and milling segment.
The CODMs primarily use a measure of gross profit to assess the performance of the operating segments. Interest income,
finance costs and assets are not allocated to segments, as these activities are driven by the central treasury function which
manages the cash position of the Group while assets are shared between the segments. There is no single customer of the
Group making up 10% of revenue.
i) Segment revenue from contracts with customers
The Group derives revenue from the transfer of goods at a point in time by operating segment as follows:
Group
2022
Segment revenue
Inter-segment eliminations
External revenue
Gross profit
2021
Segment revenue
Inter-segment eliminations
External revenue
Gross profit
Company
2022
Segment revenue
Gross profit
2021
Segment revenue
Gross profit
Retailing and Food
Production
K’000
5,363,544
(2,034,457)
3,329,087
743,970
5,010,359
(1,705,770)
3,304,589
853,462
Retailing and Food
Production
K’000
1,103,568
292,687
1,043,621
287,869
Cropping
& Milling
K’000
3,314,797
(1,249,123)
2,065,674
889,216
2,795,857
(1,126,095)
1,669,762
617,254
Cropping
& Milling
K’000
2,257,860
580,551
1,836,441
506,622
Total
K’000
8,678,341
(3,283,580)
5,394,761
1,633,186
7,806,216
(2,831,865)
4,974,351
1,470,716
Total
K’000
3,361,428
873,238
2,880,062
794,491
62
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
5 Segment reporting (continued)
i) Segment revenue (continued)
Gross profit by segment reconciles to operating profit as follows:
Group
2022
Gross profit by segment
Other income/(expenses)
Distribution and administrative expenses
Impairment of goodwill
Impairment of investment in subsidiaries
Operating profit
2021
Gross profit by segment
Other income/(expenses)
Distribution and administrative expenses
Impairment of goodwill
Operating profit
Company
2022
Gross profit by segment
Other income/(expenses)
Distribution and administrative expenses
Impairment of goodwill
Impairment of investment in subsidiaries
Operating profit
2021
Gross profit by segment
Other income/(expenses)
Distribution and administrative expenses
Impairment of goodwill
Operating profit
Operating profit
Unallocated:
Share of loss from equity investment
Finance income
Finance costs
Retailing and Food
Production
K’000
716,420
(34,267)
(628,683)
(141,786)
-
(88,316)
827,447
(4,949)
(722,524)
-
99,974
292,687
2,835
(217,726)
-
(141,786)
(63,990)
287,869
(3,479)
(22,653)
-
61,736
Cropping
& Milling
K’000
916,766
18,889
(673,675)
-
-
261,980
643,269
(6,802)
(490,042)
-
146,425
580,551
6,614
(508,027)
-
-
79,138
506,622
(8,119)
(413,499)
-
85,005
Group
2022
K’000
2021
K’000
173,664
246,399
(3,503)
3,541
(3,358)
45,897
(118,538)
(116,916)
Company
2022
K’000
15,148
(3,503)
3,534
(91,009)
Total
K’000
1,633,186
(15,378)
(1,302,358)
(141,786)
-
173,664
1,470,716
(11,751)
(1,212,566)
-
246,399
873,238
9,449
(725,753)
-
(141,786)
15,148
794,491
(11,598)
(636,152)
-
146,741
2021
K’000
146,741
(3,358)
56,792
(84,980)
Profit before income tax
55,164
172,022
(75,830)
115,195
63
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 5 Segment reporting (continued)
ii) Disaggregated revenue streams
Retailing
Beef
Chicken
Pork
Fish
Dairy products
Stockfeed
Day-old chicks
Wheat
Soya
Maize grain
Flour mil
Other
Less: intercompany sales
Group
Company
2022
K’000
3,098,958
694,603
463,003
362,024
2,186
338,894
3,458,062
280,504
114,303
337,329
52,485
261,863
87,404
(3,156,858)
2021
K’000
2,906,466
630,140
436,035
396,788
14,465
278,913
1,747,742
224,577
152,854
395,671
53,805
280,478
73,150
(2,616,732)
2022
K’000
-
683,836
16,291
936
2,186
220,427
1,584,367
-
114,303
337,329
52,485
261,863
87,404
-
2021
K’000
-
621,397
11,972
21,089
14,465
240,715
1,014,466
-
152,854
395,671
53,805
280,478
73,150
-
5,394,761
4,974,351
3,361,428
2,880,062
iii) Segment assets and liabilities
The Group’s assets and liabilities are not allocated to each segment. However, the CODMs review information regarding the
operating assets and liabilities of the main reporting entities within the Group as shown in the table below.
For the purpose of allocating assets and liabilities, the ‘Other’ segment comprises of the foreign subsidiaries (Master Meats
Nigeria and Ghana), Zamleather Limited, Zamchick Limited and Zamhatch Limited.
As at 30 September 2022
Total assets
Total liabilities
As at 30 September 2021
Total assets
Total liabilities
6 Other income/(expenses)
Rental income
Loss on disposal of fixed assets
Exchange losses on working capital
Company
Retailing Ltd
Masterpork
K’000
K’000
K’000
Other
K’000
Total
K’000
4,181,638
1,285,576
824,979
258,337
256,869
190,320
567,634
241,737
5,831,120
1,975,970
4,692,197
1,351,368
453,106
251,458
214,485
110,028
129,709
90,901
5,489,497
1,803,755
Group
Company
2022
K’000
6,069
(29,386)
25,808
2021
K’000
14,120
(2,260)
(20,305)
2022
K’000
5,339
(21,772)
33,758
2021
K’000
12,870
(553)
(22,727)
2,491
(8,445)
17,325
(10,410)
64
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
7 Breakdown of expenses by nature
Group
Company
Cost of sales of providing goods:
Changes in inventory – Retail products
Changes in inventory – Beef products
Changes in inventory – Poultry products
Changes in inventory – Consumables
Changes in inventory – Feed
Changes in inventory – Grain
Changes in inventory – Milling products
Changes in inventory – Farm inputs
Production and overhead costs
Fuel expenses
Transport
Veterinary
Other miscellaneous expenses
Distribution expenses:
Employee benefits expense (Note 9)
Depreciation
Repairs and maintenance
Levies and licenses
Transport
Boarding and Lodging
Insurance
Satellite
Travel
Other
Administrative expenses:
Depreciation
Employee benefits expense (Note 9)
Legal and other professional fees
Directors’ remuneration
Auditors’ remuneration
Repairs and maintenance
Water and electricity
Other miscellaneous expenses
Total expenses
8 Finance income and costs
Finance income:
Exchange gains on borrowings (Note 29(ii))
Exchange gains on leases (Note 29(ii)
Finance costs:
Interest expense on bank overdrafts
Interest expense on borrowings (Note 29(ii))
Interest expense on leases (Note 29(ii))
Net finance costs
2022
K’000
588,272
536,286
129,531
234,278
1,524,799
47,481
10,487
602,930
55,488
41,151
88
15,459
324,787
4,111,037
29,447
16,612
4,735
6,483
1,682
-
1,022
696
701
4,218
65,596
105,471
638,489
24,639
13,648
4,100
118,256
72,532
259,627
1,236,762
2021
K’000
507,909
364,410
66,999
273,210
1,453,678
137,529
66,270
1,062,415
50,588
30,768
1,189
14,693
302,338
4,331,996
21,771
14,527
11,641
5,985
5,680
2,709
1,730
1,262
559
984
66,848
145,944
626,772
30,124
16,675
5,700
119,157
70,980
130,366
1,145,718
2022
K’000
-
316,606
2,069
97,822
1,022,700
33,836
11,488
285,247
177,254
41,151
7,813
16,708
813,548
2,826,242
-
-
-
-
67,118
-
-
-
-
-
67,118
48,343
360,683
19,012
13,648
6,504
66,182
43,592
100,671
658,635
2021
K’000
-
247,938
6,671
146,676
1,048,326
155,078
67,065
183,666
274,633
22,459
20,997
17,838
439,567
2,630,914
-
-
-
-
-
-
-
-
-
-
-
94,913
352,995
30,124
16,675
3,600
53,929
28,554
55,362
636,152
5,413,395
5,544,562
3,551,995
3,267,066
3,188
353
3,541
(63,252)
(53,473)
(1,813)
(118,538)
(114,997)
39,860
6,037
45,897
(74,650)
(38,998)
(3,268)
(116,916)
(71,019)
3,188
346
3,534
(36,752)
(53,473)
(784)
(91,009)
(87,475)
39,860
16,932
56,792
(47,966)
(35,380)
(1,634)
(84,980)
(28,188)
65
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 9 Employee benefit expense
Salaries and other staff costs
Retirement benefits costs:
Social security costs
Pension costs
Allocated as:
Distribution expenses
Administrative expenses
10 Income tax expense
Group
Company
2022
K’000
571,910
49,207
46,819
667,936
29,447
638,489
667,936
2021
K’000
576,112
39,518
32,913
648,543
21,771
626,772
648,543
2022
K’000
331.662
14,668
14,352
360,682
-
360,682
360,682
2021
K’000
310,831
28,879
13,285
352,995
-
352,995
352,995
This note provides an analysis of the Group’s income tax expense and how the tax expense is affected by non-assessable and
nondeductible items.
Current income tax charge
Deferred tax charge (Note 25)
Group
Company
2022
K’000
73,333
(5,639)
67,694
2021
K’000
16,541
18,607
35,148
2022
K’000
27,029
5,181
32,210
2021
K’000
1,042
14,753
15,795
i) Numerical reconciliation of income tax expense to prima facie tax payable
Applicable tax rates range from 10% to 30% depending on the activities of the entities within the Group.
The tax on the Group’s profit before income tax differs from the theoretical amount that would arise using the statutory
income tax rate as follows:
Profit before income tax from:
Continuing operations
Discontinued operations
Group
2022
K’000
55,164
44,108
99,272
2021
K’000
172,022
31,949
203,971
Company
2022
K’000
(75,830)
44,108
(31,722)
2021
K’000
115,195
31,949
147,144
Tax at rate of 10% (2021: 10%)
9,927
20,397
(3,172)
14,714
Tax effects of:
Expenses not deductible for tax purposes
Effect of difference in tax rates
Income tax expense is attributable to:
Profit from continuing operations
Profit from discontinued operation
45,988
11,779
6,550
8,201
35,382
-
1,081
-
67,694
35,148
32,210
15,795
63,283
4,411
31,953
3,195
27,799
4,411
12,600
3,195
67,694
35,148
32,210
15,795
66
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
10 Income tax expense (continued)
ii) Movement in current income tax on the statement of financial position
At start of year
Current income tax charge
Payments made during the year
At end of year
iii) Analysis of tax losses
Group
Company
2022
K’000
10,064
73,333
(44,877)
2021
K’000
(1,743)
16,541
(4,734)
2022
K’000
(2,520)
27,029
(9,828)
2021
K’000
(565)
1,042
(2,997)
38,520
10,064
14,681
(2,520)
During the year, the Group carried forward tax losses of K275.4 million (2021: K413.5 million). Unutilised losses expire after
5 years as shown in the table below:
Period end
30 September 2017
30 September 2018
30 September 2019
30 September 2020
30 September 2021
30 September 2022
Total
Tax loss c/f
Expiry date
K’000
-
214,157
16,729
4,794
37,549
2,159
275,388
30 September 2022
30 September 2023
30 September 2024
30 September 2025
30 September 2026
30 September 2027
67
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
11 Property, plant and equipment
Group
As at 30 September
2020
Cost or fair value
Accumulated
depreciation
Land and
buildings
Aircraft
Plant
and
machinery
Motor
vehicles
Furniture
and
equipment
Capital
work in
progress
Total
K’000
2,431,488
K’000
865
K’000
945,804
K’000
95,392
K’000
38,607
K’000
K’000
11,022
3,523,178
(44,568)
(259)
(205,291)
(50,905)
(8,836)
-
(309,859)
Net book value
2,386,920
606
740,513
44,487
29,771
11,022
3,213,319
Year ended 30
September 2021
Opening net book value
2,386,920
606
740,513
Additions
Transfers
Revaluation surplus
Disposals -cost
Disposals-accumulated
depreciation
8,956
18,688
83,720
-
-
(865)
19,004
11,898
48,463
4,544
44,487
19,671
865
52,756
(2,106)
-
259
(1,388)
(96,918)
(44,617)
1,102
(24,404)
(583)
29,771
11,022
3,213,319
8,276
556
7,464
(69)
60
(4,618)
(568)
47,144
103,051
(32,007)
-
-
-
-
192,403
1,504
33
(143,165)
(42)
(295,410)
Depreciation charge
Exchange differences
(17,225)
(249,600)
Net book value
2,231,459
As at 30 September
2021
Cost or fair value
2,234,711
Accumulated
depreciation
(3,252)
Net book value
2,231,459
-
-
-
-
-
-
681,499
91,788
40,872
26,117
3,071,735
685,643
93,729
41,970
26,159
3,082,212
(4,144)
(1,941)
(1,098)
(42)
(10,477)
681,499
91,788
40,872
26,117
3,071,735
Assets classified as capital work in progress mainly relate to the costs incurred for the ongoing farm expansion projects at the
Group's locations.
68
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
11 Property, plant and equipment (continued)
Group
As at 30 September 2021
Cost or fair value
Accumulated depreciation
Land and
buildings
K’000
2,234,711
(3,252)
Plant
and
machinery
K’000
685,643
(4,144)
Motor
vehicles
K’000
93,729
(1,941)
Furniture
and
equipment
K’000
41,970
(1,098)
Capital
work in
progress
K’000
26,159
Total
K’000
3,082,212
(42)
(10,477)
Net book value
2,231,459
681,499
91,788
40,872
26,117
3,071,735
Year ended 30 September
2022
Opening net book value
2,231,459
681,499
Additions
Transfers
Revaluation surplus
Disposals -cost
Disposals-accumulated
depreciation
Depreciation charge
Exchange differences
4,071
15,953
1,219
968
93,300
-
91,788
9,924
24,116
-
(15,234)
(5,329)
(1,096)
770
(16,034)
(10,963)
-
(61,095)
(9,870)
6
(24,385)
(57)
40,872
26,117
3,071,735
3,492
8,177
-
(49)
5
(9,577)
(19)
203,680
222,135
(141,546)
-
-
1,219
(7,550)
(29,258)
-
-
-
781
(111,092)
(20,909)
Net book value
2,211,241
699,473
100,296
42,900
80,701
3,134,611
As at 30 September 2022
Cost or fair value
Accumulated depreciation
2,230,527
(19,286)
764,712
(65,239)
126,622
(26,326)
53,575
(10,675)
80,701
3,256,137
-
(121,526)
Net book value
2,211,241
699,473
100,296
42,900
80,701
3,134,611
Assets classified as capital work in progress mainly relate to the costs incurred for the ongoing farm expansion projects at the
Group's locations.
69
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
11 Property, plant and equipment (continued)
Company
Land and
buildings
Plant
and
machinery
As at 30 September 2020
K’000
K’000
Cost or fair value
1,972,733
603,570
Motor
vehicles
K’000
23,415
Accumulated depreciation
(21,191)
(135,818)
(12,456)
Furniture
and
equipment
K’000
19,534
(4,143)
Capital
work in
progress
K’000
8,276
Total
K’000
2,627,528
0
(173,608)
Net book value
1,951,542
467,752
10,959
15,391
8,276
2,453,920
Year ended 30 September
2021
Opening net book value
1,951,542
467,752
Additions
Transfers
Revaluation surplus
Disposals-cost
Disposals-accumulated
depreciation
Depreciation charge
Exchange differences
10,959
3,261
0
14,441
(141)
11,311
5,854
(12,855)
(1,385)
1,249
12,607
35,103
0
0
751
110
(8,612)
(249,603)
(66,185)
(53,934)
(5,058)
(980)
15,391
3,518
8,276
2,453,920
18,055
37,394
0
(18,461)
3,436
(64)
52
(2,205)
(505)
0
0
0
0
0
0
40,125
(1,590)
913
(82,060)
(305,022)
Net book value
1,742,286
351,309
22,592
19,623
7,870
2,143,680
As at 30 September 2021
Cost or fair value
1,742,286
351,309
22,592
19,623
7,870
2,143,680
Accumulated depreciation
-
-
-
-
-
-
Net book value
1,742,286
351,309
22,592
19,623
7,870
2,143,680
Assets classified as capital work in progress mainly relate to the costs incurred for the ongoing farm expansion projects at the
Group's locations.
70
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
11 Property, plant and equipment (continued)
Company
As at 31 30 September
2021
Land and
buildings
K’000
Plant
and
machinery
Motor
vehicles
Furniture and
equipment
Capital work
in progress
K’000
K’000
K’000
K’000
Total
K’000
Cost or fair value
1,742,286
351,309
22,592
19,623
7,870
2,143,680
Accumulated
depreciation
-
-
-
-
-
-
Net book value
1,742,286
351,309
22,592
19,623
7,870
2,143,680
Year ended 30
September 2022
Opening net book value
1,742,286
351,309
Additions
Transfers
Revaluation surplus
Disposals-cost
Disposals-accumulated
depreciation
Depreciation charge
Exchange differences
1,440
3,804
-
3,711
55,812
-
(215)
(30,292)
0
2,196
(7,361)
(10,963)
(30,903)
(2,081)
22,592
2,010
3,263
-
(101)
6
(4,752)
(57)
19,623
590
2,920
-
(3)
1
(4,181)
(19)
7,870
2,143,680
102,107
(65,799)
-
109,858
-
-
(6,792)
(37,404)
-
-
-
2,203
(47,197)
(13,120)
Net book value
1,728,991
349,752
22,961
18,931
37,386
2,158,021
As at 30 September
2022
Cost or fair value
1,736,352
368,954
Accumulated
depreciation
(7,361)
(19,202)
24,826
(1,865)
23,111
(4,180)
37,386
2,190,699
-
(32,608)
Net book value
1,728,991
349,752
22,961
18,931
37,386
2,158,021
Assets classified as capital work in progress mainly relate to the costs incurred for the ongoing farm expansion projects at the
Group's locations.
The register showing the details of property as required by Section 30 of the Companies Act, 2017 of Zambia is available
during the business hours at the registered office of the Group.
71
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
11 Property, plant and equipment (continued)
i) Non-current assets pledged as security
All assets disclosed are pledged as security on the Group’s borrowings for each reporting period and title is restricted. The
Group had no contractual commitments for the acquisition of property, plant and equipment and no amount of compensation
from third parties for items of property, plant and equipment that were impaired, lost or given up that is included in profit or
loss
ii) Carrying amounts that would have been recognised if assets were stated at cost
If items of property, plant and equipment were stated on the historical cost basis, the amounts would be as follows:
Cost
Accumulated depreciation
12 Leases
Group
2022
K’000
1,877,967
(1,008,426)
2021
K’000
1,679,925
(896,794)
Company
2022
K’000
1,360,195
(903,307)
2021
K’000
1,277,585
(846,742)
869,541
783,131
456,888
430,843
The Group leases various offices and retail stores (classified as buildings) and farm and production equipment and trailers
(classified as plant and machinery). Lease agreements do not impose any covenants other than the security interests in the
leased assets that are held by the lessor.
a) Right of use assets
Group
As at 30 September 2020
Cost
Accumulated depreciation
Buildings
K’000
15,425
(8,362)
Plant
and machinery
K’000
60,381
(16,258)
Net book value
7,063
44,123
Year ended 30 September 2021
Opening net book value
Additions
Derecognised - cost
Derecognised - accumulated depreciation
Depreciation charge
Net book value
As at 30 September 2021
Cost
Accumulated depreciation
Net book value
7,063
7,843
-
-
(9,404)
5,502
23,268
(17,766)
5,502
44,123
5,735
(5,964)
1,789
(7,902)
37,781
60,152
(22,371)
37,781
Total
K’000
75,806
(24,620)
51,186
51,186
13,578
(5,964)
1,789
(17,306)
43,283
83,420
(40,137)
43,283
72
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
12 Leases (continued)
a) Right of use assets (continued)
Group
As at 30 September 2021
Cost
Accumulated depreciation
Buildings
K’000
23,268
(17,766)
Plant
and machinery
K’000
60,152
(22,371)
Net book value
5,502
37,781
Year ended 30 September 2022
Opening net book value
Additions
Derecognised – cost
Derecognised - accumulated depreciation
Depreciation charge
Net book value
As at 30 September 2022
Cost
Accumulated depreciation
Net book value
Company
As at 30 September 2020
Cost
Accumulated depreciation
Net book value
Year ended 30 September 2021
Opening net book value
Additions
Depreciation charge
Net book value
As at 30 September 2021
Cost
Accumulated depreciation
Net book value
5,502
4,919
-
-
(1,518)
8,903
28,187
(19,284)
8,903
-
-
-
-
-
-
-
-
-
37,781
10,156
(24,963)
9,985
(9,473)
23,486
47,134
(23,648)
23,486
29,454
(6,980)
22,474
22,474
5,735
(5,406)
22,803
35,189
(12,386)
22,803
Total
K’000
83,420
(40,137)
43,283
43,283
15,075
(24,963)
9,985
(10,991)
32,389
75,321
(42,932)
32,389
29,454
(6,980)
22,474
22,474
5,735
(5,406)
22,803
35,189
(12,386)
22,803
73
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
12 Leases (continued)
a) Right of use assets (continued)
Year ended 30 September 2022
Buildings
Plant
and machinery
Company
Opening net book value
Additions
Depreciation charge
Net book value
As at 30 September 2022
Cost
Accumulated depreciation
Net book value
b) Lease liabilities
Current
Non-current
22,803
10,156
(9,368)
23,591
45,345
(21,754)
-
-
-
-
-
-
23,591
23,591
Group
2022
K’000
5,046
12,597
2021
K’000
12,418
7,253
Company
2022
K’000
4,878
5,354
17,643
19,671
10,232
Total
22,803
10,156
(9,368)
23,591
45,345
(21,754)
2021
K’000
6,597
1,873
8,470
2021
K’000
3,495
1,634
8,237
13,366
Refer to Note 29 (ii) for details on the movement in lease liabilities on the statement of financial position.
ai) Amounts recognised in the statement of profit or loss
Depreciation charge:
Interest expense on lease liabilities
Expense relating to short-term leases
Group
Company
2022
K’000
10,451
1,822
20,783
33,056
2021
K’000
17,306
1,634
8,237
27,177
2022
K’000
8,222
784
5,790
14,796
During the year, there were no expenses relating to low-value assets and variable lease payments recognised in profit or loss
(2021: Nil).
bi) Maturity analysis of contractual lease payments outstanding
Within 1 year
Between 1 and 2 years
Between 2 and 3 years
Between 3 and 4 years
Between 4 and 5 years
Later than 5 years
Minimum lease payments
Finance charges
Net present value
Group
Company
2022
K’000
7,094
6,453
1,843
1,972
1,976
7,991
27,329
(9,686)
17,643
2021
K’000
13,085
5,434
625
469
469
3,345
23,427
(3,756)
19,671
2022
K’000
5,790
5,225
-
-
-
-
11,015
(784)
10,231
2021
K’000
6,945
3,159
-
-
-
-
10,104
(1,634)
8,470
The Group did not receive any COVID-19-related rent concessions during the year (2021: Nil).
74
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
13 Goodwill
Goodwill is monitored by management at the level of the three cash-generating units (CGU). During the year, the Directors
assessed the future economic performance of Zamchick and were of the view that the goodwill on this CGU was impaired as
the market was challenged. A CGU-level summary of the goodwill allocation is presented below:
At start of year
Impairment of Goodwill
At end of year
Masterpork
15,699
-
15,699
Zamchick
141,786
(141,786)
-
Zamhatch
9,316
9,316
Total
166,801
(141,786)
25,015
The following table sets out the key assumptions for those CGUs that have significant goodwill allocated to them:
Year ended 30 September 2022
Budgeted average operating margins
Discount rates
Long-term growth rate
Year ended 30 September 2021
Budgeted average operating margins
Discount rates
Long-term growth rate
Masterpork
Zamchick
Zamhatch
2%
22.8%
7.3%
4%
17%
10%
10%
21.2%
6.3%
9%
15.5%
8%
17%
22.8%
7.3%
16%
15%
6%
Management has determined the values assigned to each of the above key assumptions as follows:
• Budgeted operating margins: Based on past performance and management’s expectations for the future;
• Discount rates: Reflect specific risks relating to the relevant segments and the countries in which they operate;
• Long-term growth rate: This is the weighted average growth rate used to extrapolate cash flows beyond the budget period.
The rates are consistent with forecasts included in industry reports.
The sensitivity of Goodwill (excluding the CGU impaired) to changes in the weighted principal assumptions is:
Year ended 30 September 2022
Budgeted average operating margins (-2%)
Discount rates (+1%)
Long-term growth rate (-2%)
Year ended 30 September 2021
Budgeted average operating margins (-2%)
Discount rates (+1%)
Long-term growth rate (-2%)
Masterpork
K’000
(50,067)
(8,021)
(7,133)
(133,906)
(42,962)
(61,233)
Impact on headroom
Zamchick
K’000
-
-
-
(120,806)
(91,750)
(127,064)
Zamhatch
K’000
(170,921)
(109,589)
(130,333)
(112,107)
(125,938)
(165,772)
A reduction in the average operating profit margine of 2% in the Masterpork - CGU will give rise to an impairment.
The recoverable amount of the cash generating unit (CGU) calculated based on value in use exceeded the carrying value of the
net assets as follows:
Masterpork Limited
Zamchick Limited
Zamhatch Limited
2022
K’000
18,610
-
854,733
2021
K’000
185,633
321,184
801,831
75
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
14 Investment in subsidiaries
a) Subsidiaries
The Group’s investments in subsidiaries at 30 September 2022 are set out below. Following the impairment of Goodwill on
Zamchick, the Directors were of the view that the investment in the same entity was impaired.
Subsidiary
Investment in subsidiaries
Impairment (Note 13)
Subsidiary
Zambeef Retailing Limited
Zamleather Limited
Master meat (Nigeria) Ltd
Master meat (Ghana) Ltd
Masterpork Limited
Zamchick Limited
Zamhatch Limited
2022
K’000
245,807
(141,787)
104,020
2022
K’000
31
1,477
216
1,310
26,601
16,443
57,942
104,020
2021
K’000
245,807
-
245,807
2021
K’000
31
1,477
216
1,310
26,601
158,230
57,942
245,807
Unless otherwise stated, the entities have share capital consisting solely of ordinary shares that are held directly by
the Group, and the proportion of ownership interests held equals the voting rights held by the Group. The country of
incorporation or registration is also their principal place of business.
Place of
Name of subsidiary
Zambeef Retailing Ltd
Zamleather Limited
Master meat (Nigeria) Ltd
Master meat (Ghana) Ltd
Masterpork Limited
ZamChick Limited
Zamhatch Limited
Principal activities
incorporation Ownership interest
2021
100% Retailing of Zambeef products
100% Processing and sale of leather & shoes
80% Processing and sale of meat products
90% Processing and sale of meat products
100% Processing and sale of pork
100% Processing and sale of poultry products
100% Chicken breeding, rearing and production of stock feed
Zambia
Zambia
Nigeria
Ghana
Zambia
Zambia
Zambia
2022
100%
100%
80%
90%
100%
100%
100%
b) Non-controlling interest (NCI)
Set out below is summarised financial information for each subsidiary that has non-controlling interests. The amounts
disclosed for each subsidiary are before inter-company eliminations.
Nigeria - Master Meat Ltd
Ghana - Master Meat Ltd
Statement of profit or loss
Revenue
Profit for the year
Other comprehensive income
Total comprehensive income
Profit allocated to NCI
Dividends paid to NCI
Statement of financial position
Current assets
Current liabilities
Net current liabilities
Non-current assets
Non-current liabilities
Net non-current assets
Net (liabilities)/assets
Accumulated NCI
Statement of cash flows
Cash flows from operating activities
Cash flows from investing activities
Cash flows from financing activities
Net increase in cash
76
2022
K’000
238,317
11,895
-
11,895
2,379
-
29,087
(71,989)
(42,902)
30,424
-
30,424
2021
K’000
256,481
3,831
-
3,831
766
-
33,500
(80,424)
(46,924)
33,090
-
33,090
(12,478)
(13,834)
1,638
11,895
(109)
-
11,786
(741)
3,811
(477)
-
3,334
2022
K’000
53,672
470
-
470
47
-
3,435
(5,536)
(2,101)
704
(31)
673
(1,428)
(1,572)
470
(10)
-
460
2021
K’000
70,079
771
-
771
77
-
6,842
(6,159)
683
840
(47)
793
1,476
(1,878)
771
(33)
-
738
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
15 Investment in associates
Set out below is the associate of the Group as at 30 September 2022 which, in the opinion of the Directors, is material to the
Group. The entity has share capital consisting solely of ordinary shares, which are held directly by the Group. The country of
incorporation or registration is also the entity’s principal place of business, and the proportion of ownership interest is the
same as the proportion of voting rights held.
Name of subsidiary
Place of
incorporation
Zampalm Limited
Zambia
Ownership interest
2022
10%
2021
10%
Nature of
relationship
Associate
Zampalm Limited’s principal activity is the establishment of a palm oil plantation and processing plant and the production
of crude palm oil. The company is still in the developmental stage and is expected to start generating profits in 2024. As at
the end reporting date, the Group had a 10% equity interest in Zampalm Limited. The Group has reasonable influence over
Zampalm Limited as it has representation on the Board of Directors, participates in policy making decisions and provides
essential farming technical information.
Based on the discounted cashflow projections on a five-year period, the Directors are of the opinion that the investment in
associate is not impaired. The following table sets out the key assumptions for those CGUs that have significant goodwill
allocated to them:
Budgeted average operating margins
Discount rates
Long-term growth rate
2022
K’000
6.65%
23.5%
5%
2021
K’000
6%
20%
4.5%
Management has determined the values assigned to each of the above key assumptions as follows:
• Budgeted operating margins: Based on past performance and management’s expectations for the future;
• Discount rates: Reflect specific risks relating to the relevant segments and the countries in which they operate;
• Long-term growth rate: This is the weighted average growth rate used to extrapolate cash flows beyond the budget period.
The rates are consistent with forecasts included in industry reports.
The sensitivity of the investment in associate to changes in the weighted principal assumptions is:
Budgeted average operating margins (-2%)
Discount rates (+1%)
Long-term growth rate (-2%)
2022
K’000
(6,920)
(2,424)
(831)
2021
K’000
(6,682)
(2,318)
(659)
If the budgeted gross margin used in the value-in-use calculation for the Investment in associate had been 2% lower than
management’s estimates at year end (4.65% instead of 6.65%), the Group would have had to recognise an impairment against
the carrying amount of Investment in associate of K4.7m (2021: K4.4 million).
The recoverable amount of the investment in associate calculated based on value in use exceeded the carrying value of the
net assets as follows:
Investment in associate
2022
K’000
2,242
2021
K’000
2,300
The Group had no commitments and contingent liabilities in respect of associate (2021: Nil).
77
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
15 Investment in associates (continued)
i) Summarised financial information for associate
The information disclosed below reflects the amounts presented in the annual financial statements of the relevant associate,
Zampalm Limited and not the Group’s share of those amounts.
Statement of profit or loss:
Revenue
Loss from continuing operations
Profit from discontinued operations
Loss for the year
Other comprehensive income
Total comprehensive income
Statement of financial position:
Non-current assets
Current assets
Total assets
Capital and reserves
Non-current liabilities
Current liabilities
Total equity and liabilities
ii) Reconciliation of carrying amounts:
At start of year
Share of loss for the year
Share of other comprehensive income
At end of year
2022
K’000
2,854
(35,028)
-
(35,028)
-
(35,028)
262,279
17,384
279,663
75,609
185,374
18,680
279,663
40,468
(3,503)
-
36,965
2021
K’000
4,313
(33,582)
-
(33,582)
-
(33,582)
270,693
31,757
302,450
111,278
173,768
17,404
302,450
43,826
(3,358)
-
40,468
78
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
16 Biological assets
The Group’s biological assets comprise standing crops, feedlot cattle, dairy cattle, pigs and chickens.
i) Analysis by group of biological assets
Group
As at 30 September 2021
Standing
crop
K’000
Feedlot
cattle
K’000
Dairy
cattle
K’000
Pigs
K’000
Chickens
K’000
Total
K’000
At start of year
Increase due to purchases
Change in fair value of biological assets:
Due to biological transformation
Due to price changes
16,626
518,097
40,652
324,237
62,380
102,248
434,115
-
434,115
71,910
-
71,910
39,818
3,323
43,141
4,120
13,241
7,323
3,328
10,651
52,527
474,082
176,305
1,431,905
268,544
-
268,544
821,710
6,651
828,361
Transfer of harvest to inventory
Decrease due to slaughter/sale
(914,253)
-
-
(280,485)
-
(136,404)
-
(20,394)
-
(726,038)
(914,253)
(1,163,321)
At end of year
Current
Non-current
As at 30 September 2022
At start of year
Increase due to purchases
Change in fair value of biological assets:
Due to biological transformation
Due to price changes
54,585
156,314
71,365
7,618
69,115
358,997
54,585
-
156,314
-
-
71,365
7,618
-
69,115
-
287,632
71,365
54,585
156,314
71,365
7,618
69,115
358,997
54,585
404,645
156,314
407,488
71,365
119,963
7,618
12,977
69,115
174,992
358,997
1,120,065
292,823
-
292,823
75,124
-
75,124
22,290
-
22,290
4,960
(1,262)
3,698
(42,379)
(2,094)
(44,473)
352,818
3,356
349,462
Transfer of harvest to inventory
Decrease due to slaughter/sale
(684,072)
-
-
(427,150)
-
(8,876)
-
(24,293)
-
(148,588)
(684,072)
(608,907)
At end of year
Current
Non-current
67,981
115,077
86,592
67,981
-
115,077
-
-
86,592
67,981
115,077
86,592
-
-
-
-
51,046
320,696
51,046
-
234,104
86,592
51,046
320,696
All assets disclosed are pledged as security on the Group’s borrowings for each reporting period and title is restricted. There
were no commitments for the development or acquisition of biological assets.
For standing crops, contributory asset charges have been incorporated into the fair value of the biological assets.
79
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
16 Biological assets (continued)
i) Analysis of group of biological assets (continued)
Company
As at 30 September 2021
At start of year
Increase due to purchases
Change in fair value of biological assets:
Due to biological transformation
Due to price changes
Standing
crop
K’000
Feedlot
cattle
K’000
Dairy
cattle
K’000
Chickens
K’000
Total
K’000
16,626
518,097
434,115
-
434,115
40,652
324,237
62,380
102,248
71,910
-
71,910
39,818
3,323
43,141
19,843
74,919
(3,823)
-
(3,823)
139,501
1,019,501
542,020
3,323
545,343
Transfer of harvest to inventory
Decrease due to slaughter/sale
(914,253)
-
-
(280,485)
-
(136,404)
-
(65,255)
(914,253)
(482,144)
At end of year
Current
Non-current
54,585
156,314
71,365
25,684
307,948
54,585
-
156,314
-
-
71,365
25,684
-
236,583
71,365
54,585
156,314
71,365
25,684
307,948
As at 30 September 2022
At start of year
Increase due to purchases
Change in fair value of biological assets:
Due to biological transformation
Due to price changes
54,585
404,645
292,823
-
292,823
156,314
310,789
75,125
-
75,125
Transfer of harvest to inventory
Decrease due to slaughter/sale
(684,069)
-
-
(427,151)
71,365
1,813
22,290
-
22,290
-
(8,876)
25,684
75,811
(52,186)
-
(52,186)
307,948
793,058
338,052
-
338,052
-
(49,309)
(684,069)
(485,336)
At end of year
Current
Non-current
67,984
115,077
86,592
67,984
-
115,077
-
-
86,592
67,984
115,077
86,592
-
-
-
-
269,653
183,061
86,592
269,653
All assets disclosed are pledged as security on the Group’s borrowings for each reporting period and title is restricted. There
were no commitments for the development or acquisition of biological assets.
For standing crops, contributory asset charges have been incorporated into the fair value of the biological assets.
80
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
16 Biological assets (continued)
ii) Number of hectares and livestock
As at 30 September 2022, the Group had the following number of hectares and livestock
Number of hectares
Standing crop
Number of livestock
Feedlot cattle
Dairy cattle
Chickens
Pigs
Culled animals
Feedlot cattle
Dairy cattle
Pigs
Chickens
iii) Key assumptions
Group
2022
928
9,036
3,254
229,475
-
41,039
1,186
5,319
6,753,961
2021
811
12,836
3,407
759,611
3,744
32,591
976
6,459
8,225,446
Company
2022
928
9,036
3,254
-
-
41,039
1,186
5,319
-
2021
811
12,836
3,407
282,695
-
32,591
976
-
-
The significant assumptions in the determination of the fair value of biological assets are the average weight per animal and
average yield per hectare for standing crop. The assumptions used for the valuation of the biological assets are as follows:
Average weight - kg
Bulls
Heifers
Steers
Cows
Average yields per hectare - tons
Wheat
iv) Sensitivity
Group
2022
605
401
433
464
8.0
2021
685
373
501
469
8.13
Company
2022
605
401
433
464
8.0
2021
685
373
501
469
8.13
The sensitivity of the biological assets to changes in the weighted principal assumptions is:
Change in assumption
Average weight (-1%)
Average yields per hectare (-1%)
Impact on biological assets
Group
Company
2022
K’000
(1,510)
(680)
2021
K’000
(2,637)
(573)
2022
K’000
(1,510)
(680)
2021
K’000
(2,638)
(573)
81
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
17 Inventory
Trading stocks
Abattoir stocks
Raw materials
Stock feed
Consumables
Raw hides and chemicals
Group
Company
2022
K’000
544,345
27,302
132,250
506,136
220,337
11,542
2021
K’000
455,847
23,628
117,962
388,548
203,175
8,686
2022
K’000
429,358
27,302
73,106
304,245
143,656
-
2021
K’000
306,922
23,628
90,734
256,057
95,631
-
1,441,912
1,197,846
977,667
772,972
Inventories recognised as an expense
3,674,064
3,932,420
1,769,768
1,855,420
18 Trade and other receivables
Trade receivables
Loss allowance (Note 4(b))
Amounts due from related parties (Note 31)
Loans receivable (Note 31)
Prepayments
Other receivables
Group
Company
2022
K’000
137,565
(29,612)
107,953
3,123
-
158,244
19,980
2021
K’000
166,465
(11,743)
154,722
4,202
-
36,515
42,839
2022
K’000
53,791
(14,479)
39,312
609,450
67,683
62,541
7,531
2021
K’000
95,377
(6,063)
89,314
710,080
70,474
2,388
-
289,300
238,278
786,517
872,256
Due to the short-term nature of the current receivables, their carrying amount is considered to be the same as their fair value.
As at the end of the reporting period, there were no trade receivables subject to a factoring arrangement (2021: Nil).
19 Cash and cash equivalents
Group
2022
K’000
2021
K’000
Company
2022
K’000
2021
K’000
Cash at bank and in hand
223,972
201,539
136,149
113,193
The above figures reconcile to the amount of cash shown in the statement of cash flows at the end of the financial year as
follows:
Balances as above
Bank overdrafts (Note 24)
Group
Company
2022
K’000
223,973
(351,681)
2021
K’000
201,539
(490,204)
2022
K’000
136,149
(164,025)
2021
K’000
113,193
(306,417)
Balances per statement of cash flows
(127,708)
(288,665)
(27,876)
(193,224)
As at the reporting period, there were no deposits at call nor any restricted cash.
82
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
20 Discontinued operations
In 2020, the Group announced its intention to exit Chiawa Farm unit and initiated an active program to locate a buyer for
its assets, primarily consisting of property, plant and equipment. The associated assets and liabilities were consequently
presented as held for sale in subsequent years.
While there have been several interested parties, the Group has maintained the farm under active marketing as a suitable
bidder is yet to be found. Based on the recent offer letters received from prospective buyers, the Directors are of the opinion
that the carrying amount of the assets does not exceed their recoverable value as at the end of the reporting period.
Financial information relating to the discontinued operation for the year is set out below.
i) Financial performance
Revenue
Expenses
Profit before income tax
Income tax expense
Profit for the year
Other comprehensive income
Total comprehensive income for the year
ii) Cashflow information
Net cash inflow from operating activities
Net cash inflow from investing activities
Net cash from financing activities
Net increase in cash generated by the farm
iii) Assets and liabilities of disposal group classified as held for sale
2022
K’000
107,039
(62,931)
44,108
(4,411)
39,697
-
39,697
44,108
-
-
44,108
The following assets were reclassified as held for sale in relation to the assets classified as held for sale:
Assets classified as held for sale
Property plant and equipment
Additions
Depreciation*
2022
K’000
170,550
6,748
(7,207)
2021
K’000
181,519
(149,570)
31,949
(3,195)
28,754
-
28,754
31,949
-
-
31,949
2021
K’000
175,654
-
(5,104)
*As the assets have been under active marketing since 2020, the Group depreciates the assets at end of each period reporting
period as the assets are still in use.
There were no liabilities directly associated with assets classified as held for sale during the year (2021: Nil).
170,091
170,550
83
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
21 Share capital and share premium
Ordinary shares
Authorised
2022
Shares
2021
Shares
2022
K’000
2021
K’000
700,000,000
700,000,000
7,000,000
7,000,000
Issued and fully paid
300,579,630
300,579,630
3,006
3,006
Share premium
1,125,012
1,125,012
1,125,012
1,125,012
Preference shares
Authorised and issued -fully paid
i) Ordinary shares
100,057,658
100,057,658
1,000
1,000
Ordinary shares have a par value of K0.01. They entitle the holder to participate in dividends, and to share in the proceeds of
winding up the Group in proportion to the number of and amounts paid on the shares held.
On a show of hands every holder of ordinary shares present at a meeting, in person or by proxy, is entitled to one vote, and on
a poll each share is entitled to one vote. Of the 300,579,630 issued and fully paid shares, 137,675,979 are held by shareholders
on the AIM London and 162,903,611 are held by shareholders on the Lusaka Stock Exchange.
ii) Preference shares
The major shareholder, British International Investment Plc (BII), is the holder of 100,057,658 convertible redeemable preference
shares with a par value of K0.01. These shares have four voting rights for every five preference shares held resulting in BII
having 34.8% of the voting rights
The preference shares are convertible in whole or in part by BII into ordinary shares on a one-for-one basis for the first eight
years from 2016 and thereafter on a basis of 3.0833 ordinary shares for each preference share. The Group has the right
to redeem all or part of the preference shares at the redemption price, which will give BII a 12% compounded return on
investment.
The zero-coupon preference shares pay a dividend only if a dividend is paid to ordinary shareholders, and in such cases, the
dividend per share will be the same as that for ordinary shares.
22 Foreign currency translation reserve
This represents the accumulated foreign exchange differences arising from the translation of foreign retail
operations in Nigeria and Ghana. For the Company, reserve arose from the translation of Mpongwe Farms which were foreign
denominated up until 31 December 2021. The reserves are non-distributable.
At start of year
Translation differences - foreign operations
Translation differences - Mpongwe Farms
Less translation difference - NCI
Group
Company
2022
K’000
720,131
(16,320)
(10,847)
(259)
2021
K’000
1,003,834
(14,710)
(271,935)
2,942
2022
K’000
697,895
-
(10,847)
-
2021
K’000
969,830
-
(271,935)
-
At end of year
692,705
720,131
687,048
697,895
84
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
23 Revaluation reserve
Items of property, plant and equipment are recognised at fair value based on periodic, but at least triennial valuations performed
by external independent valuers, less subsequent depreciation. The reserve is used to record increments and decrements on
the revaluation of non-current assets. The fair value of property, plant and equipment was revalued on 30 September 2021 by
Messrs, Fairworld Properties Limited.The reserves are non-distributable to the shareholders and are recognised net of deferred
income tax.
In the event of a sale of an asset, any balance in the reserve in relation to the asset is transferred to retained earnings.
At start of year
Revaluation surplus (Note 11)
Excess depreciation
Deferred income tax (Note 25)
At end of year
24 Borrowings
Non-Current
Bank loans
Current
Bank loans
Bank overdrafts
Group
2022
K’000
2021
K’000
Company
2022
K’000
1,160,653
1,034,388
739,522
-
(53,928)
6,394
192,403
(44,377)
(21,761)
-
(30,155)
2,912
2021
K’000
745,684
40,125
(46,972)
685
1,113,119
1,160,653
712,279
739,522
Group
2022
K’000
2021
K’000
Company
2022
K’000
2021
K’000
426,222
195,555
426,222
195,555
173,644
351,681
525,325
210,709
490,204
700,913
173,644
164,025
337,669
210,709
306,417
517,126
951,547
896,468
763,891
712,681
Refer to Note 29 (ii) for details on the movement in borrowings on the statement of financial position.
ii) Bank loans
Standard Chartered Bank Zambia Plc
The Group has a structured agricultural facility with an annual revolving limit. The purpose of the facility is the financing of
wheat, soya beans and maize under collateral management agreements. Interest on the facility is SOFR plus 4.45 per cent per
annum calculated on the daily overdrawn balances. The facility is secured by a fixed and floating charge over grain stocks of
wheat, soya beans and maize and is repayable in 270 days. As at the end of the reporting period, the effective interest rate was
7.41 %(2021: 3.25%)
International Finance Corporation (IFC)
During the year the Group entered into an Eight (8) year amortizing the Kwacha loan facility with the IFC. Interest is fixed at 16
per cent per annum. The loan is secured through a first ranking legal mortgage over R/E of Farm No. 4450, R/E of Farm No.
4451 & R/E of Farm No. 5388 (Mpongwe farm) and is fully repayable in June 2030. The First ranking legal mortgage ranks pari
passu between Absa Bank Zambia Plc . As at the end of the reporting period, the effective interest rate was 16 %(2021: 12 %).
Stanbic Bank Zambia Limited
The Group has a seasonal loan facility with an annual revolving limit. Interest on the facility is 8.5 per cent. above the Bank of
Zambia policy rate per annum payable monthly in arrears. This facility is secured by a floating charge/debenture over all the
assets of the Group. The floating charge/debenture ranks pari passu between Standard Chartered Bank Zambia Plc. The loan
is repayable by July 31st in respect of summer cropping and January 31st in respect of Winter Cropping
As at the end of the reporting period, the effective interest rate was 17.5 %(2021: 17%).
85
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
24 Borrowings (continued)
Absa Bank Zambia Plc
The Group has an amortizing loan at an interest rate of Bank of Zambia policy rate plus 6.5%. The facility is secured through a
first ranking legal mortgage over R/E of Farm No. 4450, R/E of Farm No. 4451 & R/E of Farm No. 5388 (Mpongwe farm). The
first ranking charge ranks pari passu with the International Finance Corporation (IFC) and is repayable in February 2026. As at
the end of the reporting period, the effective interest rate was 15.5% (2021:15%).
iii) Bank-overdrafts
The Group has annual revolving bank overdraft facilities held with various banks namely, Zambia National Commercial Bank,
Stanbic Bank Zambia Limited, Citi Bank Zambia Limited, Standard Chartered Bank Zambia Limited and First National Bank.
Interest on the bank overdrafts are payable at, in respect of ZMW limits, the prevailing Bank of Zambia (BOZ) Monetary Policy
Rate plus a liquidity premium and a margin ranging from 3.5 % to 7.5% and in respect of USD limits, the prevailing SOFR rate
plus a margin ranging from 3.5% to 4%. As at the end of the reporting period, the average effective interest rate was 8.5 %
(2021: 9.67%).
The bank overdrafts and Short-term seasonal loan facilities are secured by a floating charge/debenture over all the assets of
the Group with a security cover of 125 per cent. of limits. The floating charge/debenture ranks pari passu between Standard
Chartered Bank Zambia Plc, Citibank Zambia Limited, Zanaco Bank Plc, Stanbic Bank Zambia Limited and First National Bank
(FNB).
iv) Compliance with loan covenants
Under the terms of the borrowing facilities, the Group is required to comply with the following financial covenants:
Interest cover ratio: (EBITDA/Interest charges)
Current ratio: (Current assets/Current liabilities)
Debt service cover ratio: (EBITDA/Debt service)
Net debt to EBITDA ratio (Total debt- cash)/EBITDA)
Loan to covenant value (Total debt/Total assets)
Liabilities to tangible net worth ratio (Total liabilities/(Equity-Goodwill-Deferred tax)
Target
2022
2021
>2.5
>1.3
>1.5
<3.0
<130%
<1.0
3.7
1.8
1.53
0.7
10%
0.5
4.0
1.6
1.7
1.4
12%
0.5
The Group complied with the financial covenants of its borrowing facilities throughout the reporting period.
v) Fair value
The fair values are not materially different from their carrying amounts.
25 Deferred income tax
Deferred income tax is calculated using the enacted income tax rate of range of 10% to 30%% depending of the activity of the
entities within the Group The movement on the deferred income tax account is as follows:
At start of year
Charge/(credit) in profit or loss
Charge/(credit) in equity
Group
Company
2022
K’000
235,250
(5,639)
(6,394)
2021
K’000
195,444
18,607
21,199
2022
K’000
138,117
5,181
(3,018)
2021
K’000
124,190
14,753
(826)
At end of year
223,217
235,250
140,280
138,117
Deferred tax assets and liabilities in each jurisdiction are offset as there is a legally enforceable right to offset current tax assets
and liabilities and the deferred tax balances where these relate to the same taxation authority.
86
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
25 Deferred income tax (continued)
Deferred income tax assets and liabilities and deferred income tax charge/(credit) in profit or loss and equity are attributable
to the following items.
Group
Year ended 30 September 2022
Deferred income tax liabilities
Property, plant and equipment
Revaluation surplus
Change in fair value of biological assets
Deferred income tax assets
Tax losses carried forward
Defined benefit obligation
Other temporary differences
Year ended 30 September 2021
Deferred income tax liabilities
Property, plant and equipment
Revaluation surplus
Change in fair value of biological assets
Deferred income tax assets
Tax losses carried forward
Defined benefit obligation
Other temporary differences
Company
Year ended 30 September 2022
Deferred income tax liabilities
Property, plant and equipment
Revaluation surplus
Change in fair value of biological assets
Deferred income tax assets
Tax losses carried forward
Defined benefit obligation
Other temporary differences
Year ended 30 September 2021
Deferred income tax liabilities
Property, plant and equipment
Revaluation surplus
Change in fair value of biological assets
Deferred income tax assets
Tax losses carried forward
Defined benefit obligation
Other temporary differences
At start of year
K’000
Profit or loss
K’000
Equity
K’000
At end of year
K’000
92,526
155,086
35,899
-
(28,183)
(1,989)
(18,089)
26,440
-
(4,335)
-
(4,382)
(10,080)
(13,282)
-
(6,394)
-
-
-
-
-
118,966
148,692
31,564
-
(32,565)
(12,069)
(31,371)
235,250
(5,639)
(6,394)
223,217
106,198
133,325
18,287
(54,446)
(1,427)
(6,493)
(13,672)
-
17,612
26,263
-
(11,596)
-
21,761
(562)
-
92,526
155,086
35,899
-
(28,183)
(1,989)
(18,089)
195,444
18,607
21,199
235,250
57,281
82,169
30,795
(18,290)
(1,415)
(12,423)
17,478
-
(3,829)
(9,193)
(1,751)
2,476
-
(3,018)
-
-
-
-
74,759
79,151
26,966
(27,483)
(3,166)
(9,947)
138,117
5,181
(3,018)
140,280
63,300
82,854
14,929
(33,074)
(1,274)
(2,545)
124,190
(6,019)
15,866
14,784
-
(9,878)
14,753
-
(685)
-
-
(141)
-
(826)
57,281
82,169
30,795
(18,290)
(1,415)
(12,423)
138,117
87
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 26 Defined benefit obligations
The Group awards terminal benefits to its employees upon retirement. This scheme is unfunded, and the statutory entitlement,
which is lost if the employee is summarily dismissed, becomes payable only when the employee retires after attaining the age
of 55 years and that employee has been employed for more than ten years.
The regulator, Pensions and Insurance Authority, does not regulate gratuity schemes such as this one. However, entities that
provide an additional and separate unfunded gratuity in their annual financial statements should operate within the governing
covenants and agreements with employee representative bodies. Taxation of this scheme falls under the framework and
administration of this arrangement, including decisions as to whether to prefund the benefit costs, or amend the arrangement
design.
The Group’s accrued liability in respect of each employee is the present value of the benefits in respect of service completed to
the valuation date but based on projected earnings to retirement or date of payment. The total accrued liability (or the required
provision) at the valuation date is a summation of the accrued liability in respect of each employee.
i) Amounts recognised in statement of financial position
The amounts recognised in the statement of financial position and the movements in the net defined benefit obligation over
the year are as follows:
Group
Company
At start of year
Current service cost
Past service cost
Interest cost
Amount recognised in profit or loss
Actuarial remeasurements
Change in demographic assumptions
Change in financial assumptions
Early settlement (gains)/losses
Experience adjustment
Amount recognised in equity
Benefit payments
Per statement of financial position
Present value of unfunded obligation
ii) Actuarial assumptions
2022
K’000
8,891
168
598
519
1,285
-
-
2,895
255
3,150
(9,672)
3,654
3,654
2021
K’000
11,389
427
-
1,234
1,661
(1,596)
2,710
-
1,697
2,813
(6,970)
8,891
8,891
2022
K’000
2,124
56
201
174
431
-
-
-
972
86
1,058
2021
K’000
3,356
214
-
618
832
(798)
1,356
850
1,408
(3,247)
(3,472)
366
366
2,124
2,124
The significant actuarial assumptions in the determination of the defined benefit obligation are the discount rate, the salary
growth rate and the average life expectancy. The assumptions used for the valuation of the defined benefit obligation are as
follows:
Discount rate
Salary growth rate
Group
2022
27%
20%
2021
27%
20%
Company
2022
27%
20%
2021
27%
20%
88
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
26 Defined benefit obligations (continued)
ii) Actuarial assumptions (continued)
Assumptions regarding future mortality are set based on actuarial advice in accordance with published statistics and
experience in the local environment. These assumptions translate into an average life expectancy in years for a pensioner
retiring at age 55:
Average life expectancies:
25 years of age at reporting date
30 years of age at reporting date
35 years of age at reporting date
40 years of age at reporting date
45 years of age at reporting date
50 years of age at reporting date
iii) Risk exposure
Probability of reaching retirement age in service
Group
Company
2022
2021
2022
2021
47%
57%
66%
72%
78%
86%
47%
57%
66%
72%
78%
86%
47%
57%
66%
72%
78%
86%
47%
57%
66%
72%
78%
86%
The Group is exposed to a number of risks, the most significant of which are detailed below:
Changes in bond yields
The plan liabilities are calculated using a discount rate set with reference to Zambian government bond yields. A decrease in
government bond yields will increase the plan liabilities.
Changes in salaries
The plan benefits are calculated with reference to employees’ salaries. An increase in salaries will increase the plan liabilities.
This risk becomes higher as the expectations of short-term inflation rise increase, due to the weakened strength of the
Zambian Kwacha against other currencies.
Life expectancy
The plans’ obligations are to provide benefits for the life of the member. Therefore, increases in life expectancy will result in an
increase in the plans’ liabilities.
Liquidity
The plan is unfunded and therefore there is a risk that resources may not be available when needed to pay the benefits as they
fall due.
iv) Sensitivity
The sensitivity analysis is based on changes in an assumption while holding all other assumptions constant. In practice, this
is unlikely to occur, and changes in some of the assumptions may be correlated.
When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions, the same method
(present value of the defined benefit obligation calculated with the projected unit credit method at the end of the reporting
period) has been applied as when calculating the defined benefit liability recognised in at end of the reporting period.
89
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
26 Defined benefit obligations (continued)
iv) Sensitivity (continued)
The sensitivity of the defined benefit obligation to changes in the weighted principal assumptions is:
Change in assumption
Discount rate (-1%)
Salary growth rate (+1%)
life expectancy (-1 year)
Impact on defined benefit obligation
Group
Company
2022
K’000
215
234
867
2021
K’000
203
233
871
2022
K’000
108
117
469
2021
K’000
106
112
462
The scheme does not have any assets and therefore benefits are met as they become due. The weighted average duration of
the defined benefit obligation is 12.1 years (2021: 12.1 years).
v) Maturity analysis
The expected maturity analysis of undiscounted pension benefits is as follows:
Within 1 year
Between 1 - 2 years
Between 2 - 5 years
Over 5 years
27 Trade and other payables
Trade payables
Amounts due to related parties
(Note 31)
Gratuity and leave pay provisions
Legal and other related claims
Statutory liabilities
Other payables
Group
Company
2022
K’000
-
-
203
3,451
3,654
2021
K’000
-
-
177
8,714
8,891
2022
K’000
-
-
21
345
366
Group
Company
2022
K’000
344,186
-
126,962
107,901
26,566
43,958
2021
K’000
265,270
-
105,755
63,552
17,846
61,782
2022
K’000
166,173
-
82,565
107,901
6,041
5,134
2021
K’000
-
-
18
2,106
2,124
2021
K’000
180,999
77,273
64,076
55,573
7,218
10,352
649,573
514,205
367,814
395,491
Trade payables are unsecured and are usually paid within 30 days of recognition. Gratuity and leave pay provisions are paid
as and when they fall due but mainly in December at the end of employee contracts. Legal and other claim are paid within 3
months average of recognition.
The carrying amounts of trade and other payables are considered to be the same as their fair values, due to their short-term
nature.
90
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
28 Contract liabilities
Contract liabilities relate to advance payments received from customers on grain, day-old chicks, stock feed and other related
to contracts with customers:
products. The Group has
recognised
following
liabilities
related
the
At start of year
Revenue recognised from opening liability
Receipts from customer at period end
Group
Company
2022
K’000
119,206
(119,206)
97,400
2021
K’000
97,672
(97,672)
119,206
2022
K’000
94,485
(94,485)
97,400
2021
K’000
92,276
(92,276)
94,485
At end of year
97,400
119,206
97,400
94,485
During the year, there was no revenue recognised from performance obligations satisfied in previous periods (2021: Nil).
Contract liabilities increased due to the negotiation of larger prepayments and an increase in overall contract activity. All
revenue streams under contract liabilities are for periods of one year. As permitted under IFRS 15, the transaction price
allocated to these unsatisfied performance obligations is not disclosed.
29 Cash generated from operations
Profit before income tax from:
Continuing operations
Discontinued operations (Note (20(i)
Adjustments for:
Changes in employee benefits (Note 26(i))
Interest expense on leases (Note 8)
Exchange gains on leases (Note 8)
Interest expense on borrowings (Note 8)
Exchange gains on borrowings (Note 8)
Loss on disposal of assets (Note 6)
Depreciation on fixed assets (Note 11)
Depreciation on right of use assets (Note 12(a))
Depreciation on assets held for sale (Note 20 (ii))
Share of loss of associate (Note 15(ii))
Impairment of goodwill
Impairment of investment in subsidiaries (Note 14)
Change in fair value of biological assets (Note 16)
Foreign exchange differences
Changes in working capital:
Biological assets*
Inventories
Trade and other receivables
Trade and other payables
Contract liabilities
Group
2022
K’000
55,164
44,108
99,272
1,287
1,813
(353)
53,473
(3,188)
29,386
111,092
10,991
459
3,503
141,786
-
(349,462)
2,027
387,763
(244,066)
(51,022)
135,370
(21,806)
2021
K’000
172,022
31,949
203,971
1,661
3,268
(6,037)
38,988
(39,860)
2,260
143,165
17,306
5,104
3,358
-
-
(828,361)
8,775
645,669
(94,206)
(96,273)
176,439
21,534
Company
2022
K’000
(75,831)
44,108
(31,723)
431
784
(346)
53,473
(3,188)
21,772
47,197
9,368
459
3,503
-
141,786
(338,052)
14,949
376,347
(204,695)
85,739
(27,678)
2,915
2021
K’000
115,195
31,949
147,144
832
1,634
(16,932)
35,380
(39,860)
553
83,971
3,495
5,104
3,358
-
-
(545,343)
30,087
379,895
41,109
498,416
(511,388)
2,209
Cash generated from operations
308,323
206,761
153,025
119,664
*The movement in biological assets excludes the change in fair value of biological assets already adjusted for.
91
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
29 Cash flow information (continued)
ii) Net debt reconciliation
This section sets out an analysis of net debt and the movements in net debt for each of the periods presented.
Group
Company
2022
K’000
223,973
(599,866)
(351,681)
(17,643)
2021
K’000
201,539
(406,264)
(490,204)
(19,671)
2022
K’000
136,149
(599,866)
(164,025)
(10,232)
2021
K’000
113,193
(406,264)
(306,417)
(8,470)
(745,217)
(714,600)
(637,974)
(607,958)
Liabilities from financing
activities
Net Cash/
(Bank-overdrafts)
Total
Bank loans
K’000
(517,116)
(669,619)
(38,998)
740,611
38,998
39,860
(406,264)
(406,264)
(722,995)
(53,473)
526,205
53,473
3,188
(599,866)
(517,116)
(669,619)
(35,380)
740,611
35,380
39,860
(406,264)
(406,264)
(722,995)
(53,473)
526,205
53,473
3,188
(599,866)
Leases
K’000
(43,009)
(13,578)
(3,268)
30,879
3,268
6,037
(19,671)
(19,671)
(13,290)
(1,813)
14,965
1,813
353
(17,643)
(35,946)
(3,619)
(1,634)
14,163
1,634
16,932
(8,470)
(8,470)
(9,430)
(784)
7,322
784
346
(10,232)
K’000
(236,909)
(51,756)
(74,650)
-
74,650
-
(288,665)
(288,665)
160,957
(63,252)
-
63,252
-
(127,708)
(158,177)
(35,047)
(47,966)
-
47,966
-
(193,224)
(193,224)
165,436
(36,752)
-
36,752
(88)
(27,876)
K’000
(797,034)
(734,953)
(116,916)
771,490
116,916
45,897
(714,600)
(714,600)
(575,328)
(118,538)
541,170
118,538
3,541
(745,217)
(711,239)
(708,285)
(84,980)
754,774
84,980
56,792
(607,958)
(607,958)
(566,989)
(91,009)
533,527
91,009
3,446
(637,974)
Cash and cash equivalents (Note 19)
Bank loans (Note 24)
Bank overdrafts (Note 24)
Lease liabilities (Note 12(b))
Net debt
Group
2021
At start of year
Additions
Interest charged
Principal repayments
Interest paid
Foreign exchange gains
At end of year
2022
At start of year
Additions
Interest charged
Principal repayments
Interest paid
Foreign exchange gains
At end of year
Company
2021
At start of year
Additions
Interest charged
Principal repayments
Interest paid
Foreign exchange gains
At end of year
2022
At start of year
Additions
Interest charged
Principal repayments
Interest paid
Foreign exchange gains
At end of year
92
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
30 Earnings per share (EPS)
Group
Company
Basic earnings per share
Continuing operations
Discontinued operations
Total basic earnings per share
Diluted earnings per share
Continuing operations
Discontinued operations
Total diluted earnings per share
2022
Ngwee
(3.51)
13.21
9.70
(2.63)
9.91
7.28
2021
Ngwee
46.60
9.57
56.17
34.96
7.18
42.14
2022
Ngwee
(34.46)
13.21
(21.25)
(25.85)
9.91
(15.94)
2021
Ngwee
34.13
9.57
43.70
25.61
7.18
32.79
i) Reconciliations of earnings used in calculating earnings per share
Profit attributable to the ordinary equity holders of the Company used in calculating basic and diluted earnings per share is as
follows:
Continuing operations
Discontinued operations
Group
2022
K’000
(8,119)
39,697
2021
K’000
140,069
28,754
Company
2022
K’000
(103,629)
39,697
2021
K’000
102,595
28,754
31,578
168,823
(63,932)
131,349
ii) Weighted average number of shares used as the denominator
Ordinary shares used in calculating basic EPS
Preferences shares
2022
shares
300,579,630
100,057,658
2021
shares
300,579,630
100,057,658
Total weighted average shares used in calculating diluted EPS
400,637,288
400,637,288
93
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
31 Related party transactions
The Group is listed on the Lusaka Stock Exchange (LuSE) and has various shareholders. There is no ultimate controlling parent
entity. The major shareholder, BII Plc which has 17.3% shareholding, is also the holder of 100,057,658 convertible redeemable
preference shares. These shares have four voting rights for every five preference shares held resulting in BII having 34.8% of
the voting rights.
Name
BII
i) Subsidiaries
Type
Place of incorporation
Ownership interest
Major shareholder
London
2021
17.3%
2020
17.3%
Interests in subsidiaries are set out in Note 14.
ii) Key management personnel compensation
Key management includes Directors (executive and non-executive) and members of senior management. The compensation
paid or payable to key management for employee services is shown below:
Short-term employee benefits
Retirement benefit cost - NAPSA
Group
Company
2022
K’000
141,028
796
2021
K’000
141,669
1,453
2022
K’000
106,453
584
141,824
143,122
107,037
iii) Transactions with other related parties
The following transactions occurred with related parties:
Sales of:
Animal feed and bran
Beef products
Poultry products
Pork products
Purchases of:
Beef products
Poultry products
Pork products
Distribution services
Company
Group
2022
K’000
2021
K’000
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
2022
K’000
188
1,276,861
214,169
51,375
1,542,593
5,988
33,858
2,894
-
42,740
2021
K’000
108,889
1,074
109,963
2021
K’000
1,799
996,507
315,958
29,430
1,343,694
2,239
9,044
19,956
3,810
35,049
The Group sales and purchases transactions are with Director owned companies while for the Company, the transactions are
made with fellow subsidiaries.
94
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
31 Related party transactions (continued)
iv) Outstanding balances arising from sales/purchases of goods and services
The following balances are outstanding at the end of the reporting period in relation to transactions with related parties:
Receivables from:
Directors:
Danny Museteka
Lillian Limbuka
Subsidiaries:
Zamleather Limited
Master Meat Nigeria Limited
Master Meat Ghana Limited
Zamhatch Limited
Masterpork Limited
Zambeef Retailing Limited
Zamchick Limted
Common directorship:
Tembilo Farms Limited
Associates:
Zampalm Limited
Payables to:
Subsidiary
Zamchick Limited
Loans receivable
At start of year
Loans advanced
Interest receivable
Loan repayments received
Group
2022
K’000
-
-
-
-
-
-
-
-
-
-
3,123
3,123
2021
K’000
93
683
-
-
-
-
-
-
-
152
-
3,274
4,202
Company
2022
K’000
-
-
-
73,506
64,168
3,515
250,766
102,727
102,100
80,352
-
-
-
2,419
679,533
2021
K’000
93
-
-
50,284
67,113
3,362
110,857
56,331
489,944
-
-
-
-
2,570
780,554
-
-
-
77,273
70,474
667
-
(3,458)
67,683
63,292
13,057
-
(5,875)
70,474
70,474
667
-
(3,458)
67,683
63,292
13,057
-
(5,875)
70,474
The loans receivable relates to amounts advanced to foreign subsidiaries in Nigeria of K64 million (2021: K67 million) and
Ghana of K3.5 million (2021: K3.4 million) for the purposes working capital requirements. The loans are insecure, payable on
demand and interest free.
v) Directors’ remuneration
Non-executive Director fees
Executive Director salaries and short-term emoluments
Retirement benefit costs – NAPSA contributions
2022
K’000
3,267
10,382
29
13,678
2021
K’000
3,438
10,394
28
13,860
95
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
32 Correction of material error in calculating deferred income tax
During the year, the Group identified an omission of deferred income tax liability on revaluation surplus arising on revalued
items of property, plant and equipment in accordance with IAS 12 Income taxes. The correction of the error resulted in an
understatement of deferred income tax liability by K135 million for the Group on 1 October 2020 and an overstatement in
revaluation reserves of K133 million and K1.7 million in retained earnings as at that date.
The error has been corrected by restating each of the affected financial statement line items for the prior periods as follows:
Year ended 30 September 2020
Group
Statement of financial position
Net deferred income tax liability
Statement of changes in equity
Revaluation surplus
Retained earnings
Company
Statement of financial position
Net deferred income tax liability
Statement of changes in equity
Revaluation surplus
Retained earnings
Year ended 30 September 2021
Group
Statement of financial position
Net deferred income tax liability
Statement of changes in equity
Revaluation surplus
Retained earnings
Company
Statement of financial position
Net deferred income tax liability
Statement of changes in equity
Revaluation surplus
Retained earnings
1-Oct-20
K’000
Increase/(decrease)
K’000
Restated: 1-Oct-20
K’000
60,398
135,046
195,444
1,167,713
470,174
41,153
828,538
597,524
1-Oct-21
K’000
(133,325)
(1,721)
1,034,388
468,453
83,037
(82,854)
(184)
124,190
745,684
597,340
Increase/(decrease)
K’000
Restated: 1-Oct-21
K’000
79,005
156,245
235,250
1,315,739
679,718
(155,086)
(1,159)
1,160,653
678,559
55,905
821,691
774,437
82,212
(82,169)
(43)
138,117
739,522
774,394
33 Contingencies
The Group is party to various legal cases whose outcome is dependent on the conclusion of the Zambian judicial process.
Management makes estimates for the outcomes of these cases based on professional advice. There are some cases where,
based on professional advice received, the directors have not made any provision.
The value of potential claims against the Group that would likely result in an unfavourable outcome as at 30 September was
nil (2021: Nil).
34 Commitments
i) Capital commitments
Significant capital expenditure contracted for at the end of the reporting period but not recognised as liabilities was K44.6
million (2021: K3.1 million).
ii) Operating commitments
Contractual obligation for future purchase of raw materials not recognised as a liability was K11.896 million (2021: K13.847
million).
35 Events occurring after the reporting period
Beyond 2021, the existence of novel coronavirus (Covid-19) has continued to cause disruptions to businesses and economic
activity.
To date, the Group has not seen, nor expects to see in the near future, a major impact on its operations by the pandemic,
however, should the pandemic continue for an extended period of time, there’s a possibility that the risks will materialize and
hence have a significant impact on the Company’s financial performance.
96
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC
36 Comparatives
Comparative figures and disclosures have been adjusted to conform to changes in presentation in the current period for the
following:
• Segment reporting
• Revenue
• Discontinued operations
• Defined benefit obligation
• Borrowings
97
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC 98
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC Supplementary
Information -
presented in USD
(unaudited)
99
Notes to annual financial statements (continued)For the year ended 30 September 2022Annual Report 2022Zambeef Products PLC Statement of profit or loss and other comprehensive income
Revenue from contracts with customers
Change in fair value of biological assets
Cost of sales of providing goods
Group
Company
2022
US$’000
314,014
18,567
(237,518)
2021
US$’000
235,528
39,222
(205,113)
2022
US$’000
195,659
17,903
(162,734)
2021
US$’000
136,367
25,821
(124,570)
Gross profit
95,063
69,637
50,828
37,618
Other income/(expenses)
Net impairment losses on financial assets
Impairment of goodwill
Distribution expenses
Administrative expenses
145
(1,040)
(8,253)
(3,818)
(71,989)
(400)
(556)
-
(3,165)
(54,248)
(516)
(458)
(8,253)
(3,907)
(38,337)
(493)
(56)
-
-
(30,121)
Operating profit
10,108
11,667
881
6,948
Share of loss from equity investment
Finance income
Finance costs
(204)
206
(6,900)
(160)
2,173
(5,536)
(204)
206
(5,297)
Profit before income tax
3,210
8,145
(4,414)
Income tax expense
(3,684)
(1,664)
(1,618)
(Loss)/profit from continuing operation
Profit from asset held for sale
Profit for the year
Profit attributable to:
Owners of Zambeef Products PLC
Non-controlling interests
Other comprehensive income:
Items that maybe reclassified to profit or loss
Translation losses on foreign operations
Translation losses on Mpongwe Farms
Items not reclassified to profit or loss
Revaluation surplus
Actuarial remeasurement losses
Deferred income tax
Other comprehensive income for the year
(474)
2,311
1,837
1,696
141
1,837
(946)
(631)
-
(183)
368
(1,392)
6,481
1,513
7,994
7,954
40
7,994
(696)
(12,876)
9,110
(133)
(1,004)
(5,599)
(6,032)
2,311
(3,721)
(3,721)
-
(3,721)
-
(631)
-
(62)
176
(517)
(160)
2,689
(4,024)
5,453
(597)
4,858
1,360
6,218
6,218
-
6,218
-
(12,876)
1,900
(67)
39
(11,004)
Total comprehensive income for the year
445
2,395
(4,238)
(4,784)
100
Annual Report 2022Zambeef Products PLC Statement of profit or loss and other comprehensive income (continued)
Total comprehensive income for the period is
attributable to:
Owners of Zambeef Products Plc
Non-controlling interests
Basic earnings per share
Continued operations
Discontinued operations
Total basic earnings per share
Diluted earnings per share
Continued operations
Discontinued operations
Total diluted earnings per share
Group
2022
US$’000
Company
2021
US$’000
2022
US$’000
2021
US$’000
289
156
445
(0.19)
0.77
0.58
(0.15)
0.58
0.43
2,494
(99)
2,395
2.14
0.50
2.64
1.61
0.38
1.99
(4,238)
-
(4,238)
(2.01)
0.77
(1.24)
(1.50)
0.58
(0.92)
(4,784)
-
(4,784)
1.57
0.50
2.07
1.17
0.38
1.55
101
Annual Report 2022Zambeef Products PLC Consolidated statement of financial position
30-Sept-22
Restated:1-Oct-21
Restated:1-Oct-20
US$’000
198,393
2,050
1,583
2,340
5,480
209,846
14,817
91,260
18,310
14,175
10,765
-
149,327
359,173
449
185,095
100
42,945
65,256
(60,091)
233,754
4
233,758
26,976
797
14,128
231
42,132
33,248
319
41,113
6,165
2,438
83,283
359,173
US$’000
US$’000
183,497
2,586
9,964
2,417
4,263
202,727
17,182
71,556
14,235
12,039
10,188
-
125,200
327,927
449
185,095
100
38,850
69,334
(77,664)
216,164
(156)
216,008
11,682
433
18,222
531
30,868
41,871
742
30,716
7,121
601
81,051
327,927
159,549
2,542
8,282
2,176
3,097
175,646
5,657
54,798
7,052
5,518
8,722
87
81,834
257,480
449
185,095
100
45,027
51,360
(106,325)
175,706
(26)
175,680
9,445
981
14,520
565
25,511
33,513
1,155
16,771
4,850
-
56,289
257,480
ASSETS
Non-current assets
Property, plant and equipment
Right of use assets
Goodwill
Investment in associate
Biological assets
Current assets
Biological assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Current income tax asset
Total assets
EQUITY
Share capital
Share premium
Preference share capital
Foreign currency translation reserve
Revaluation reserve
Retained earnings
Attributable to owners of parent entity
Non-controlling interests
LIBILITIES
Non-current liabilities
Borrowings
Lease liabilities
Deferred income tax
Defined benefit obligations
Current liabilities
Borrowings
Lease liabilities
Trade and other payables
Contract liabilities
Current income tax
Total equity and liabilities
102
Annual Report 2022Zambeef Products PLC Company statement of financial position
ASSETS
Non-current assets
Property, plant and equipment
Right of use assets
Investment in subsidiaries
Investment in associate
Biological assets
Current assets
Biological assets
Inventories
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Current income tax asset
Total assets
EQUITY
Share capital
Share premium
Preference share capital
Foreign currency translation reserve
Revaluation reserve
Retained earnings
LIBILITIES
Non-current liabilities
Lease liabilities
Borrowings
Deferred income tax
Defined benefit obligations
Current liabilities
Lease liabilities
Borrowings
Trade and other payables
Contract liabilities
Current income tax
Total equity and liabilities
30-Sept-22
Restated:1-Oct-21
Restated:1-Oct-20
US$’000
US$’000
US$’000
136,584
1,493
6,584
2,340
5,481
152,482
11,586
61,878
49,780
8,617
10,765
-
142,626
295,108
449
185,095
100
39,096
45,081
(62,986)
206,835
339
26,976
8,879
23
36,217
309
21,371
23,282
6,165
929
52,056
295,108
128,057
1,362
14,684
2,417
4,263
150,783
14,133
46,175
52,107
6,762
10,188
151
129,516
280,299
449
185,095
100
37,521
44,177
(71,939)
195,403
112
11,682
12,420
126
24,340
394
30,892
23,626
5,644
-
60,556
280,299
121,843
1,116
12,205
2,176
3,097
140,437
3,829
40,421
68,057
628
8,722
28
121,685
262,122
449
185,095
100
43,339
37,025
(99,926)
166,082
406
9,445
10,982
166
20,999
718
24,713
45,028
4,582
-
75,041
262,122
103
Annual Report 2022Zambeef Products PLC 104
Annual Report 2022Zambeef Products PLC 28TH ANNUAL
GENERAL
MEETING
105
Annual Report 2022Zambeef Products PLC Zambeef Products PLC
(“Zambeef” or the “Group”)
[INCORPORATED IN THE REPUBLIC OF ZAMBIA]
COMPANY REGISTRATION NUMBER: 31824
SHARE CODE: ZAMBEEF
ISIN: ZM0000000201
NOTICE OF ANNUAL GENERAL MEETING
NOTICE IS HEREBY GIVEN that the 28th Annual General Meeting of the members of the Company will be held virtu-
ally ( https://eagm.creg.co.zw/EAGM/Login.aspx) on Tuesday, December 27 2022 at 10:00 hours; in respect of the
year ended 30 September 2022.
AGENDA
1.
Minutes of the previous meeting
To receive and note the minutes of the 28th Annual General Meeting held on 27 December, 2022 duly approved
by the Chairman in accordance with the Companies Act.
2.
Financial Statements
TTo receive adopt and approve the reports of the Directors, the Auditors, and the Financial Statements for the
year ended September 30, 2022 (Ordinary resolution number 1)
3.
Ordinary Resolutions
To consider and, if deemed fit, to pass, with or without modification, the following ordinary resolutions;
3.1 Ordinary Resolutions to re-election of directors retiring by rotation
To re-elect each of Messer’s:
3.1.1. Roman Frenkel (Ordinary resolution number 2)
3.1.2 Pearson Gowero (Ordinary resolution number 3) and
3.1.3. Ms Monica Musonda (Ordinary resolution number 4)
who retire by rotation in terms of the Companies Act, and who, being eligible, offer themselves for
re-election.
The board recommends their re-election to shareholders. Their details are set out in the Annual
Report.
106
Annual Report 2022Zambeef Products PLC
3.2 Ordinary Resolution Number 5 – Approval of Directors Fees
To approve the annual fees payable by the company to the Non-Executive Directors, for the year ending
30 September 2023, unless otherwise determined by the company in a general meeting, to be revised
by 10% as follows:
§
§
§
from K 503 250 to K 553 575 for a Board member;
from K 520 000 to K572 000 for a Board member and Committee Chairperson
from K 920 000 to K1 012 000 for the Board Chairman.
3.3 Ordinary Resolution Number 6– Appointment of the independent auditor
Pursuant to the requirements of sections 257(1) of the Companies Act No. 10 of 2017, and as nominat-
ed by the company’s Audit Committee, to resolve that Messer’s PricewaterhouseCoopers be re-appoint-
ed as the company’s independent registered auditor for the financial year ending 30 September 2023
and to authorise the Directors to determine their remuneration.
4.
Non - Declaration of Final Dividend
Due to the expansion program announced in the year, the Directors recommend that no dividend be paid for
the financial year ended September 2022.
It is noted that in terms of the company’s Articles, the company may only declare a dividend if the directors
have recommended a dividend.
5.
Other business
To transact such other business as may be transacted at an annual general meeting of members.
A member entitled to attend and vote at the meeting is entitled to appoint any person (whether a member of
the Company or not) to attend, speak and vote in his/her stead. Proxy forms are obtainable from the Compa-
ny Secretary or at the Transfer Secretaries offices. The forms must be lodged at the Registered Office of the
Company not less than 48 hours before the commencement of the AGM.
Queries pertaining to shareholder relations such as change of address or bank details are to be channeled
through the Transfer Secretaries, whose contact address is:
Corpserve Transfer Agents Limited
6 Mwaleshi Road, Olympia Park, Lusaka, Zambia
Telephone
Facsimile
Email: - info@corpservezambia.com.zm
: +260 (211) 256969/70
: +260 (211) 256975
By Order of the Board
Mwansa M Mutimushi
COMPANY SECRETARY
107
Annual Report 2022Zambeef Products PLC
NOTES
Key Sign Up instructions
a). Sign Up
• Use the following link to access the platform; https://eagm.creg.co.zw/EAGM/Login.aspx
•
•
First time users are required to sign-up by clicking the “Sign Up “option.
If you registered previously, you do not need to sign up again. Kindly use the same logging credentials that
you used before. If you have forgotten your details, use the “Forgot Password” function on the login window
to retrieve your details.
• Attendees are to indicate the criteria of their attendance of the provided options i.e. Shareholder/Non-Share-
holder/Proxy
• Attendees are required to provide the necessary information to complete the sign-up procedure.
• Once Sign-up has been completed, the admins will validate information provided before granting access to
attendees. Once validated, login credentials will be delivered through email and SMS. The validation process
may take a maximum period of 48hrs.
b). Sign in
• Use the following link to access the platform: https://eagm.creg.co.zw/EAGM/Login.aspx
•
•
Enter username
Enter Password
• Click Login
• Click “Register” on the blue button to confirm online attendance
• Click “Join” to begin following video and audio transmission of meeting proceedings.
• Click “Join with Computer Audio” to attend the live meeting
108
Annual Report 2022Zambeef Products PLC MINUTES OF THE 27TH ANNUAL GENERAL MEETING OF MEMBERS
HELD ON 21ST DECEMBER, 2021 AT 10:00 HOURS AT THE RADISSON
BLU HOTEL, LUSAKA AND FROM VARIOUS LOCATIONS VIRTUALLY
1
PRESENT
DIRECTORATE:
Michael Mundashi (Chairman), Walter Roodt (Chief Executive Officer), Frank Braeken, Roman Frenkel, Pearson
Gowero, Yollard Kachinda, Jonathan Kirby, Monica Musonda and Faith Mukutu (Chief Financial Officer).
SECRETARY:
Mwansa Mutimushi
(Lists of members present as attached)
2
CALL TO ORDER / QUORUM
A quorum having been met, the meeting was called to order at 10:00 hours.
3
APOLOGIES FOR ABSENCE
No apologies for absence were recorded.
AGENDA
The notice and agenda were adopted as presented.
4 MINUTES OF THE PREVIOUS MEETING
The minutes of the Annual General Meeting of 24 December, 2020 were noted.
5 MATTERS ARISING
No matters arose for discussion from the minutes of the previous meeting.
6
THE DIRECTORS REPORT AND FINANCIAL STATEMENTS
The directors’ report, the auditor’s report and annual financial statements for the year ended 30 Septem-
ber 2021 were presented.
It was resolved that the directors’ report and financial statements for the year ended 30 September 2021 be
approved and adopted and that all matters undertaken and discharged by the directors on behalf of the com-
pany be confirmed.
109
Annual Report 2022Zambeef Products PLC
7
APPOINTMENT OF DIRECTORS
It was resolved that the appointment of Messer’s Roman Frenkel, Pearson Gowero and Ms. Katebe Monica
Musonda be confirmed.
8
RE- ELECTION OF DIRECTORS
It was resolved that to re-elect as directors Messer’s Frank Braeken, Yollard Kachinda and Michael Mundashi
who retired by rotation and offered themselves for re-election.
9
APPOINTMENT OF
REMUNERATION
INDEPENDENT AUDITORS AND DETERMINATION OF THEIR
It was resolved that Messer’s PricewaterhouseCoopers (Zambia) be appointed as auditors of the company
until the conclusion of the next Annual General Meeting and that the Board of Directors be authorised to
agree their fees.
10
ANY OTHER BUSINESS
There being no further business to transact, the meeting closed at 11:30 hours.
_________________________
CHAIRMAN
______________________
SECRETARY
Dated this 16 day of February 2022
110
Annual Report 2022Zambeef Products PLC
DECEMBER 2021 AGM ATTENDANCE REGISTER
1) Proxies
Name
STANDARD CHARTERED ZAMBIA SECURITIES
SERVICES NOMINEES LTD
NATIONAL PENSION SCHEME AUTHORITY
Proxy
Shares Held
MICHAEL MUNDASHI
52,601,435
%
17.50
MAINZA MULEYA
CHISHA
24,797,819
SATURNIA REGNA PENSION TRUST FUND
MUMBA MUSUNGA
14,285,259
SHAKA HOLDINGS INC
JOHNN RABB BERNARD
PUBLIC SERVICE PENSIONS FUND BOARD
MUMBA MUSUNGA
EARL FIDUCIARY AG ITO SPRAYVIEW TRUST EARL
FIDUCIARY AG ITO SPRAYVIEW TRUST
JOHNN RABB BERNARD
ZAMBIA SUGAR PENSION TRUST -SCHEME
STANBIC BANK PENSION TRUST FUND
KCM PENSION TRUST SCHEME
ZANACO PLC DC PENSION SCHEME
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
STANBIC NOMINEES-MPILE LOCAL EQUITY FUND
MINTU CHITEBE
BARCLAYS BANK STAFF PENSION TRUST FUND
MUMBA MUSUNGA
7,868,813
6,803,840
6,131,187
3,968,349
3,702,160
2,763,163
2,237,931
1,766,085
1,238,829
1,238,828
BARCLAYS BANK ZAMBIA STAFF PENSION FUND-
PPMZ
STANDARD CHARTERED BANK PENSION TRUST
FUND
LAFARGE CEMENT ZAMBIA PLC PENSION TRUST
SCHEME
KELVIN SHIYUNGA
MUMBA MUSUNGA
1,108,671
MUMBA MUSUNGA
1,017,190
AIRTEL ZAMBIA STAFF PENSION FUND
INDENI PENSION TRUST SCHEME
MUMBA MUSUNGA
MUMBA MUSUNGA
LUBAMBE COPPER MINES PENSION TRUST SCHEME MUMBA MUSUNGA
BUYANTANSHI PENSION TRUST FUND
MUMBA MUSUNGA
WORKERS'' COMPENSATION FUND CONTROL BOAD
MOSES SIMBEYE
PICZ PENSION TRUST-MONEY PURCHASE
KELVIN SHIYUNGA
ZAMBIAN BREWERIES PLC PENSION TRUST SCHEME MUMBA MUSUNGA
CEC PENSION TRUST SCHEME
SANDVIC MINNING PENSION SCHEME
GOLDEN SUNSET PENSION FUND
ZRA PENSION TRUST SCHEME
GAME STORES PENSION TRUST SCHEME
HEALTH SECTOR GRANT AIDED INSTITUTIONS
PENSION SCHEME
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
NATIONAL BREWERIES PENSION TRUST SCHEME
MUMBA MUSUNGA
WORKCOM PENSION TRUST SCHEME
MUMBA MUSUNGA
SUN INTERNATIONAL PENSION TRUST SCHEME
MUMBA MUSUNGA
STANBIC BANK ZAMBIA NOMINEES
RAIL SYSTEMS OF ZAMBIA
EXAMINATIONS COUNCIL OF ZAMBIA
MINTU CHITEBE
KELVIN SHIYUNGA
KELVIN SHIYUNGA
DELOITTE AND TOUCH PENSION TRUST SCHEMD
MUMBA MUSUNGA
PRUDENTIAL LIFE ASSURANCE ZAMBIA LIMITED
KELVIN SHIYUNGA
997,466
990,224
909,222
866,334
740,000
616,160
589,544
563,950
493,562
421,544
361,931
317,432
257,330
202,112
196,429
194,913
178,571
175,160
171,877
165,807
154,460
8.25
4.75
2.62
2.26
2.04
1.32
1.23
0.92
0.74
0.59
0.41
0.41
0.37
0.34
0.33
0.33
0.30
0.29
0.25
0.20
0.20
0.19
0.16
0.14
0.12
0.11
0.09
0.07
0.07
0.06
0.06
0.06
0.06
0.06
0.05
111
Annual Report 2022Zambeef Products PLC 1) Proxies (continued)
ECOBANK ZAMBIA LIMITED PENSION TRUST
SCHEME
MUMBA MUSUNGA
154,259
SCZ INTERNATIONAL LTD PENSION TRUST
MUMBA MUSUNGA
FINANCE BANK
ZAMBIA NATIONAL BUILDING SOCIETY
NATIONAL INSTITUTE FOR SCIENTIFIC AND
INDUSTRIAL RESARCH
GOLDEN SUNSET VIA AFLIFE
AFRICA 53
UTI ZAMBIA LIMITED STAFF PENSION TRUST
SCHEME
TOYOTA ZAMBIA
WORKCOM TRUST PENSION SCHEME PPMZ
KELVIN SHIYUNGA
KELVIN SHIYUNGA
MUMBA MUSUNGA
MUMBA MUSUNGA
KELVIN SHIYUNGA
MUMBA MUSUNGA
KELVIN SHIYUNGA
KELVIN SHIYUNGA
ACCESS BANK ZAMBIA LIMITED PENSION SCHEME
MUMBA MUSUNGA
MULTICHOICE PENSION SCHEME
BUYANTANSHI PENSION TRUST FUND
ZAMBEZI RIVER AUTHORITY
STANBIC NOMINEES ZAMBIA LIMITED
LUSAKA TRUST PENSION SCHEME
FINAL SALARY
HILDA''S HENS FAMILY TRUST
CEC PESION TRUST SCHEME
ZRL PENSION TRUST SCHEME
SANLAM LIFE INSURANCE (Z) LTD
STANBIC BANK ZAMBIA NOMINEES
STANBIC NOMINEES LTD
STANBIC NOMINEES ZAMBIA LIMITED
KELVIN SHIYUNGA
KELVIN SHIYUNGA
KELVIN SHIYUNGA
MINTU CHITEBE
KELVIN SHIYUNGA
KELVIN SHIYUNGA
MR CHARLES MATE
KELVIN SHIYUNGA
KELVIN SHIYUNGA
MUMBA MUSUNGA
MINTU CHITEBE
MINTU CHITEBE
MINTU CHITEBE
141,503
137,931
110,266
100,179
99,531
91,127
81,709
65,808
59,198
51,809
50,334
47,393
40,600
14,844
14,558
13,790
10,817
8,542
5,704
4,550
900
395
3
0.05
0.05
0.05
0.04
0.03
0.03
0.03
0.03
0.02
0.02
0.02
0.02
0.02
0.01
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
0.00
Total
142,399,337
47.37
2) Attendees - Shareholders
Name
SEKELI MABOSHE
MBAWEMI LUNGU
KAMPAMBA BETSON
SCHOLASTICAH MOYO
GABRIEL CHIKUSELA
Proxy
Shares Held
33,276
481
447
327
200
%
0.01
0.00
0.00
0.00
0.00
TOTAL
34,731
0.01
112
Annual Report 2022Zambeef Products PLC 3) Attendees - Non Shareholders
Name
Representing
Count
MR MATAKA NKHOMA
AUTUS SECURITIES LTD
PRISCA CHIZI
JAMES NDHLOVU
JOSEPH PHIRI
TIM HARPER
WESLEY BEENE
BWALYA SELAH
BUPE K MOONO
NDULWA MUPELA
MANGA MUNSANGO
NAMUNYIKA JERE
NENANI SICHONE
ANDREW CHIBUYE
LEAH SIMASIKU
JACK KANYANGA
BONIFACE MWAMBA
CHISHALA MALEKANO
ANTHONY SENO
FAITH MUKUTU
MBOO MUMBA
PEARSON GOWERO
WALTER ROODT
ROMAN FRENKEL
MS MONICA MUSONDA
HASTINGS MTINE
IVOR CHILUFYA
JONATHAN KIRBY
YOLLARD KACHINDA
MWANSA MUTIMUSHI
CORPSERVE ZAMBIA
CORPSERVE ZAMBIA
CORPSERVE ZAMBIA
FINNCAP GROUP
GRANT THORNTON
GRANT THORNTON
LANGMEAD & BAKER LTD
LANGMEAD & BAKER LTD
LANGMEAD & BAKER LTD
LUSAKA SECURITIES EXCHANGE
PANGAEA SECURITIES
PRICEWATERHOUSECOOPERS (PWC)
SECURITIES AND EXCHANGE COMMISSION
STOCKBROKERS ZAMBIA LIMITED
STOCKBROKERS ZAMBIA LIMITED
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
ZAMBEEF PRODUCTS PLC
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
28
113
Annual Report 2022Zambeef Products PLC FORM OF PROXY
For the 28th Annual General Meeting
I/We _____________________________________________________________________________________________________
(Name/s in block letters)
of ______________________________________________________________________________________________ (address)
being a member/ member of the above-named Company hereby appoint
1. ___________________________________ of _____________________________ or in his absence
Number of votes
(1 share = 1 vote)
2. ___________________________________ of _____________________________or in his absence
3.
the Chairman of the meeting
As my/our proxy to vote for me/us on my/our behalf at the annual meeting of the company to be held
virtually on Tuesday 27 December 2022 at 10:00 hours and at any adjournment thereof as follows:
Resolution No.
Agenda Item
Mark with X where applicable
In Favour Against
Abstain
1
.2
3
4
5.
5.
To receive adopt and approve the reports of the Directors,
the Auditors and the Financial Statements for the year ended
September 30, 2022
Re-election of Directors
i. Roman Frenkel
ii. Pearson Gowero
iii. Katebe Monica Musonda
To approve the annual fees payable by the company to the Non-
Executive Directors, for the year ending 30 September 2023,
unless otherwise determined by the company in a general
meeting, to be revised by 10%
Pursuant to Sec. 257 of the Companies Act: To appoint Messer’s
PricewaterhouseCoopers as the
independent auditors and
authorise the directors to determine the auditor’s fees.
Unless otherwise instructed, the proxy will vote as he thinks fit.
Signed at __________________________________ on this ____________________ day of ______________________ 2022
Signature ________________________________________________________________________________________________
Assisted by me (where applicable) (see note 3) ____________________________________________________________
Full name/s of signatory/ies if signing in a representative capacity (see note 4) _____________________________
114
Annual Report 2022Zambeef Products PLC
NOTES TO THE FORM OF PROXY
1.
2.
3.
4.
5.
6.
7.
A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend,
speak and vote in his/her stead. A proxy need not be a member of the Company.
If this proxy form is returned without any indication as to how the proxy should vote, the proxy will be entitled
to vote or abstain from voting as he/she thinks fit.
A minor must be assisted by his/her guardian.
The authority of a person signing a proxy in a representative capacity must be attached to the proxy unless
the Company has already recorded that authority.
In order to be effective, proxy forms must reach the registered office of the Company or the transfer secretaries
before the Annual General Meeting.
The delivery of the duly completed proxy form shall not preclude any member or his/her duly authorised
representative from attending the meeting, speaking and voting instead of such duly appointed proxy.
If two or more proxies attended the meeting, then that person attending the meeting whose name appears
first on the proxy form, and whose name is not deleted, shall be regarded as the validly appointed proxy.
115
Annual Report 2022Zambeef Products PLC
Notes
116
Annual Report 2022Zambeef Products PLC Notes
117
Annual Report 2022Zambeef Products PLC 118
Annual Report 2022Zambeef Products PLC 119
Annual Report 2022Zambeef Products PLC 120
Annual Report 2022Zambeef Products PLC