Integrated Reports Senwesbel Consolidated Financial Statements 2018 - Page 29

5.1.4 Hinterland SA (Pty) Ltd (Group) The group has a 50% interest in Hinterland SA (Pty) Ltd (“Hinterland”). The core business activity of Hinterland is the sale of farm- ing input products and direct delivery transactions such as fuel, fertiliser, seed, etcetera. The financial year-end is the same as the Senwes group financial year-end. The registered office of the company is the same as Senwes’ registered office. Hinterland is the holding company of Prodist (Pty) Ltd with a 75% shareholding while LRB has the remaining 25% shareholding. The following is the summarised financial information of the Hinterland group: 2018 2017 R’m R’m Statement of financial position of Hinterland: Non-current assets 672 692 Current assets, excluding cash and cash equivalents 755 839 Cash and cash equivalents Trade payables 19 37 (308) (261) (3) (3) Other current financial liabilities (265) (598) Non-current liabilities (335) (109) Provisions 26 9 561 606 Total carrying amount of the investment 146 123 Carrying amount of Hinterland group 141 110 26 26 (21) (13) Non-controlling interest Equity 50% proportion of the group’s ownership: Carrying amount of loan to Prodist, classified as an investment * Impairment of Prodist investment * During 2016 Senwes Ltd, AFGRI Operations (Pty) Ltd and LRB extended a loan of R130 million to Prodist. Senwes contributed R56,3 million, R26,3 million of which is an interest-free loan with no repayment terms. This loan is therefore classified as an investment and not loans receivable. The terms relating to the other R30 million are interest-free, but payable on demand. Refer to note 4.1.2. Reconciliation to carrying amount: 50% of net asset value Elimination of unrealised profit on non-monetary assets contributed to joint venture Carrying amount before other adjustments at group level 281 303 (112) (112) 169 191 (2) (47) (21) (13) Accumulated loss adjustment at group level: Day 1 adjustment made: Group Intangibles and goodwill Impairment provision Prodist Investment Additional impairment provision Prodist* Carrying amount of the investment - (8) 146 123 * The provision of R8 million was reclassified to loans receivable note 4.1.2. The impairment provision is calculated based on the unrecoverable amount (Senwes’ exposure less recoverable amount of Prodist’s assets). The revenue and loss of Hinterland group are as follows: 3 096 2 974 (2 573) (2 477) Operating expenses, excluding depreciation and amortisation (440) (450) Depreciation and amortisation (104) (29) (30) - Other income 26 17 Investment income 13 8 Finance costs (49) (40) (Loss)/profit before taxation (61) 3 (1) (36) (62) (33) Revenue Cost of sales Impairment loss Taxation Loss after taxation Senwesbel Limited Reg no: 1996/017629/06 SENWESBEL ANNUAL FINANCIAL STATEMENTS 2018 28