Crookes Brothers Limited

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ANNUAL FINANCIAL STATEMENTS 2014

CONTENTSANNUAL FINANCIAL STATEMENTSDirectors’ approval of financial statements 2

Certificate from the company secretary 2

Basis of preparation 2

Independent auditor’s report 3

Directors’ report 4

Audit committee report 6

Consolidated statements of:Profit or loss and other comprehensive income 8

Financial position 9

Cash flows 10

Changes in equity 11

Notes to the financial statements:• General information 12

• Application of new and revised IFRSs 12

• Significant accounting policies 17

• Application of new and revised IFRSs not yet adopted 25

• Critical accounting judgements and key sources of estimation uncertainty 26

• Revenue 27

• Other operating income 27

• Investment income 27

• Finance costs 27

• Operating profit 28

• Group segmental analysis 29

• Capital items 31

• Taxation 31

• Discontinued operations 33

• Assets classified as held for sale 33

• Earnings, headline earnings per share and distributions 34

• Distributions 35

• Impact of changes in accounting policies 36

• Property, plant and equipment 36

• Biological assets 37

• Investments 39

• Unsecured loans 43

• Inventories 44

• Trade and other receivables 44• Other financial assets 44• Capital, reserves and shareholding interests 45• Borrowings 47• Trade and other payables 49• Provisions 49• Net post-employment obligations 49• Employee share incentive scheme 54• Financial risk management 55• Fair value measurement 58• Related party transactions 60• Business combinations 61• Operating lease arrangements 62• Proposed capital expenditure 62• Guarantees, contingent liabilities and contingent assets 63• Events after the reporting period 63

CROOKES BROTHERS LIMITED ANNUAL FINANCIAL STATEMENTS 2014 1

2

APPROVAL OF FINANCIAL STATEMENTS

DIRECTORS’

The directors of the company are responsible for the integrity and objectivity of the annual financial statements, which have been prepared in accordance with International Financial Reporting Standards and in the manner required by the Companies Act of South Africa.

In discharging this responsibility, the group maintains suitable internal control systems designed to provide reasonable assurance that assets are safeguarded and transactions are executed and recorded in accordance with group policies.

The directors, supported by the audit committee, are satisfied that such controls, systems and procedures are in place to minimise the possibility of material loss or misstatement.

The directors believe that the group has adequate resources to continue in operation for the foreseeable future and the financial statements have, therefore, been prepared on a going-concern basis.

The annual financial statements were approved by the board of directors on 30 May 2014 and are signed on its behalf by:

Guy Wayne Guy ClarkeChairman Group managing director

Renishaw30 May 2014

CERTIFICATE FROM THE COMPANY SECRETARYI hereby certify that the company has lodged with the Companies and Intellectual Property Commission all such returns that are required of a public company in terms of the Companies Act, 2008, as amended, in respect of the year ended 31 March 2014 and that all such returns are true, correct and up to date.

Highway Corporate Services (Pty) LtdCompany secretary

Renishaw30 May 2014

BASIS OF PREPARATIONThe annual financial statements have been prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS), the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee, the information as required by the International Accounting Standards Board’s IAS 34: Interim Financial Reporting, the Companies Act, No 71 of South Africa, 2008, as amended and the JSE Limited’s Listings Requirements. The accounting policies applied in the preparation of the annual financial statements are in terms of IFRS, which are consistent with those applied in the financial statements for the year ended 31 March 2013 except for the application of new and revised IFRSs effective for periods on or after 1 January 2013. The annual financial statements have been prepared on behalf of Crookes Brothers Limited by Brett Penney CA(SA) under the supervision of Phillip Barker BA, ACMA, CGMA, group financial director.

Phillip BarkerGroup financial director

Renishaw30 May 2014


ANNUAL FINANCIAL STATEMENTS

AUDITOR’S REPORTINDEPENDENT

TO THE SHAREHOLDERS OF CROOKES BROTHERS LIMITEDWe have audited the group annual financial statements and the annual financial statements of Crookes Brothers Limited, which comprise the consolidated and separate statements of financial position as at 31 March 2014, and the consolidated and separate statements of profit and loss and other comprehensive income, the consolidated and separate statements of changes in equity and the consolidated and separate statement of cash flows for the year then ended, and the notes, comprising a summary of significant accounting policies and other explanatory information, as set out on pages 8 to 63.

DIRECTORS’ RESPONSIBILITY FOR THE FINANCIAL STATEMENTSThe company’s directors are responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa, and for such internal control as the directors determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITYOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OPINIONIn our opinion, the financial statements present fairly, in all material respects, the consolidated and separate financial position of Crookes Brothers Limited as at 31 March 2014, and its consolidated and separate financial performance and its consolidated and separate cash flows for the year then ended in accordance with International Financial Reporting Standards and the requirements of the Companies Act of South Africa.

OTHER REPORTS REQUIRED BY THE COMPANIES ACT As part of our audit of the financial statements for the year ended 31 March 2014, we have read the Directors’ Report, the Audit Committee’s Report and the Company Secretary’s Certificate for the purpose of identifying whether there are material inconsistencies between these reports and the audited financial statements.

These reports are the responsibility of the respective preparers. Based on reading these reports we have not identified material inconsistencies between these reports and the audited financial statements. However, we have not audited these reports and accordingly do not express an opinion on these reports.

Deloitte & Touche Registered Auditors

Per G D Kruger CA(SA), RAPartner

3 June 2014

National executive: LL Bam (Chief executive), AE Swiegers (Chief operating officer), GM Pinnock (Audit), DL Kennedy (Risk advisory andlegal services), NB Kader (Tax), TP Pillay (Consulting), K Black (Client and industries), JK Mazzacco (Talent and transformation), CR Beukman (Finance), M Jordan (Strategy), S Gwala (Special projects), TJ Brown (Chairman of the board), MJ Comber (Deputy chairman of the board).

Regional leader: GC Brazier

A full list of partners and directors is available on request.

B-BBEE rating: Level 2 contributor in terms of the Chartered Accountancy Profession Sector Code

Member of Deloitte Touche Tohmatsu Limited

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The directors have pleasure in submitting the annual financial statements of the group for the year ended 31 March 2014.

NATURE OF BUSINESSCrookes Brothers Limited produces a range of primary agricultural products, including sugar cane, bananas, deciduous fruit, grain and sheep, on properties located in South Africa (Mpumalanga, southern and south western areas of the Western Cape and KwaZulu-Natal), Mozambique, Swaziland and Zambia. Sugar cane continues to be the largest contributor to both revenue and profits.

SHARE CAPITALThe authorised share capital at 31 March 2014 consisted of 16 000 000 shares of 25 cents each (2013: 16 000 000). The company has no unlisted securities.

The number of issued shares is 12 546 817 at 31 March 2014 (2013: 12 385 000).

The company holds no treasury shares and has not repurchased any of its own shares during the year under review.

At the forthcoming annual general meeting shareholders will be asked to place the unissued shares of the company, up to seven comma five per cent (7,5%) of the issued share capital of the company (excluding those reserved for the share option scheme), under the control of the directors to allot these shares on such terms and conditions as they deem fit including, but not limited to, any allotments to shareholders as capitalisation awards.

FINANCIAL RESULTSGroup attributable earnings for the year ended 31 March 2014 were R201,1 million (2013: R94,2 million), representing earnings per share of 1 609 cents (2013: 761 cents). Headline earnings per share were 677 cents (2013: 754 cents).

The company has no restrictive funding arrangements.

Full details of the financial position and results of the group are set out in the annual financial statements.

DIVIDENDSThe following dividends per share were declared in respect of the year ended 31 March 2014:

• An ordinary interim dividend of 80,0 cents (2012: 80,0 cents), declared in November 2013 and paid in January 2014.

• An ordinary final dividend of 120,0 cents (2013: 160,0 cents), declared in May 2014 and payable in July 2014.

The aggregate distribution in respect of the year ended 31 March 2014 is therefore 200,0 cents (2013: 240,0 cents) per share.

DIRECTORATE AND COMPANY SECRETARYThe names of the directors at the date of this report are set out on pages 10 and 11 of the company’s integrated annual report and the name and business address of the company secretary on the inside back cover of the integrated annual report.

In terms of the company’s memorandum of incorporation Paul Bhengu, Christopher Chance, Malcolm Rutherford and Rodger Stewart retire at the annual general meeting and, being eligible, offer themselves for re-election.

Xola Sithole was appointed as a director on 30 May 2014. In terms of the company’s memorandum of incorporation he retires at the annual general meeting and, being eligible, offers himself for re-election.

INTERESTS OF DIRECTORS IN SHARE CAPITALAt 31 March 2014, the directors of the company held beneficial interests in 101 400 of the company’s issued ordinary shares. Since the end of the financial year to the date of this report the interests of the directors have remained unchanged. The register of interests of directors and managers in the share capital of the company is available for inspection at the registered office of the company. Details of the shares held per individual director are listed below.

2014 2014 2013 2013Director Direct Indirect Direct Indirect

PJ Barker 25 500 – 21 800 –P Bhengu 400 – 400 –CJH Chance – 75 000 – 75 000GS Clarke 500 – 500 –

26 400 75 000 22 700 75 000

In addition, at 31 March 2014, managers of the company held 46 000 shares (2013: 57 050 shares).

REPORTDIRECTORS’



Non-executive director Gary Vaughan-Smith and non-executive alternate director Tim Denton represent the interests of, and are directly and indirectly interested in, Silverlands (SA) Plantations Sarl, a wholly owned subsidiary of SilverStreet Private Equity Strategies SICAR – Silverlands Fund (“the Silverlands Fund”), a private equity fund based in Luxembourg. The Silverlands Fund is managed by SilverStreet Management Sarl (the fund’s General Partner) of which they are directors and shareholders. Both also have vested interests in the Silverlands Fund. Silverlands (SA) Plantations Sarl owned 3 856 680 shares at year end (2013: 3 739 593), representing 30,7% (2013: 30,2%) of the issued share capital of the company.

DIRECTORS’ REMUNERATIONAt the forthcoming annual general meeting shareholders will be requested to pass a non-binding advisory vote approving the group’s remuneration policy and a special resolution to approve increases in fees payable to non-executive directors with effect from 1 April 2014 as follows:

Current ProposedRands Rands

per annum per annum

BoardChairman 350 000 380 000Other non-executive board members 128 000 150 000

Audit committeeChairman 100 000 106 500Other members 45 000 50 000

Remuneration committeeChairman 22 000 30 000Other members 16 000 20 000

Nominations committeeChairman 11 000 15 000Other members 8 000 10 000

Risk management committeeChairman 36 000 42 000Other non-executive board members 24 000 28 000

Social and ethics committeeChairman 22 000 30 000Other non-executive board members 16 000 20 000

Retirement fundsEmployer-elected trustees 16 000 17 000

SUBSIDIARY COMPANIESThe names and financial information in respect of the interest of the company in its subsidiaries are disclosed in note 16 and set out in the full Integrated Annual Report on the company’s website at www.cbl.co.za

SPECIAL RESOLUTIONS ADOPTED BY THE COMPANY AND ITS SUBSIDIARY COMPANIESNo special resolutions have been passed by the company or its subsidiary companies since the date of the previous annual general meeting.

SUBSEQUENT EVENTSThere have been no major changes in the affairs or financial position of the company or its subsidiary companies since the end of the period under review.

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The audit committee is a committee of the board of directors and in addition to having specific statutory responsibilities in terms of the Companies Act, it assists the board through advising and making recommendations on financial reporting, oversight of internal financial controls, external and internal audit functions and statutory and regulatory compliance of the company and the group.

TERMS OF REFERENCEThe audit committee has adopted formal terms of reference that have been approved by the board of directors and has executed its duties during the past financial year in accordance with these terms of reference.

COMPOSITIONThe committee consists of three independent non-executive directors. At 31 March 2014 the audit committee comprised:

Anthony Hewat MA (Oxon), CA(SA)John Barton FCMA, CGMA, AMP (Harvard)Malcolm Rutherford BCom, BAcc, CA(SA)

On 30 May 2014 Xola Sithole was nominated to serve on this committee to replace John Barton who assumes the role of board chairman after the 2014 annual general meeting.

The group managing director, group financial director, senior financial and IT executives of the group and representatives from the external and internal auditors attend the committee meetings by invitation. The auditors, both external and internal, have unrestricted access to the audit committee chairman or any other member of the committee as required.

MEETINGSThe audit committee held two meetings during the period under review and there was full attendance at both meetings.

STATUTORY DUTIESIn execution of its statutory duties during the financial year under review, the audit committee:

• nominated for appointment as auditor, Deloitte & Touche, who, in its opinion, is independent of the company;

• determined the fees to be paid to Deloitte & Touche;

• determined Deloitte & Touche’s terms of engagement;

• ensured that the appointment of Deloitte & Touche complied with the relevant provisions of the Companies Act and King III;

• pre-approved all non-audit service contracts with Deloitte & Touche;

• confirmed that there were no complaints relating to accounting practices and internal audit of the company, the content or auditing of its financial statements, the internal financial controls of the company and any other related matters; and

• advised the board that, regarding matters concerning the company’s accounting policies, financial control, records and reporting, it concurs that the adoption of the going-concern premise in the preparation of the financial statements is appropriate.

INTERNAL FINANCIAL CONTROLS AND INTERNAL AUDITIn execution of its delegated duties in this area the committee has:

• reviewed and recommended the internal audit charter for approval;

• evaluated the independence, effectiveness and performance of the internal audit function;

• reviewed the effectiveness of the company’s system of key internal financial controls;

• reviewed the competence, qualifications and experience of the company secretary;

• reviewed significant issues raised by the external and internal audit process and the adequacy of corrective action in response to such findings;

• reviewed audit reports regarding the adequacy of accounting records; and

• reviewed policies and procedures for preventing and detecting fraud.

The chief audit executive functionally reported to the audit committee and had unrestricted access to the audit committee chairman and is of the opinion that significant internal financial controls operated effectively during the period under review.

Based on the processes and assurances obtained, the audit committee believes that significant internal financial controls are effective.

COMMITTEE REPORTAUDIT



REGULATORY COMPLIANCEThe audit committee has complied with all its applicable legal, regulatory and other responsibilities.

EXTERNAL AUDITBased on processes followed and assurances received, the committee is satisfied that Deloitte & Touche is independent of the group.

The committee confirmed that no reportable irregularities were identified and reported by the external auditors in terms of the Auditing Professions Act, No 26 of 2005.

Based on our satisfaction with the results of the activities outlined above, the audit committee has recommended to the board that Deloitte & Touche should be reappointed for 2015.

FINANCE FUNCTIONWe believe that Phillip Barker, the group financial director for the period under review and up to the date of this report, possessed the appropriate expertise and experience to meet his responsibilities in that position. We are also satisfied with the expertise and adequacy of resources within the finance function. In making these assessments we have obtained feedback from both external and internal audit.

Based on the processes and assurances obtained we believe that the accounting practices are effective.

FINANCIAL STATEMENTSBased on the processes and assurances obtained we recommend that the current annual financial statements be approved by the board.

On behalf of the audit committee

Anthony HewatAudit committee chairman

Renishaw30 May 2014

COMMITTEE REPORT CONTINUED

AUDIT

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GROUP COMPANY

2014 2013* 2014 2013*Note R’000 R’000 R’000 R’000

Continuing operationsRevenue 5.1 439 019 362 348 276 895 243 477 Cost of sales (256 129) (192 249) (171 478) (138 656)

Gross profit 182 890 170 099 105 417 104 821 Other operating income 5.2 2 489 2 488 4 107 3 821 Distribution expenses (43 568) (38 239) (32 266) (24 260) Administrative expenses (51 046) (48 505) (45 066) (44 622)

Operating profit 5.5 90 765 85 843 32 192 39 760 Share of profit of associate companies 1 121 158 – –- Investment income 5.3 4 504 35 271 5 261 36 646 Finance costs 5.4 (4 538) (2 183) (1 465) (1 466) Capital items 7 7 430 – 7 430 –-

Profit before taxation 99 282 119 089 43 418 74 940 Income tax expense 8 (19 692) (30 726) (12 663) (20 709)

Profit for the year from continuing operations 79 590 88 363 30 755 54 231 Discontinued operations Profit for the year from discontinued operations 9 123 107 5 550 123 755 6 571

Profit for the year 202 697 93 913 154 510 60 802

Other comprehensive income/(loss), net of tax Items that may not be reclassified subsequently to profit or loss Remeasurement of defined benefit asset/obligation 25.2 4 746 1 197 4 746 1 197 Remeasurement of post-retirement medical obligation 25.1 1 231 (779) 1 231 (779)

5 977 418 5 977 418

Items that may be reclassified subsequently to profit or loss Net fair value gain on available-for-sale financial assets 2 052 2 821 2 052 2 821 Reclassification adjustments on available-for-sale financial assets disposed of during the year (7 430) – (7 430) –Exchange differences on translating foreign operations (257) 8 776 – –

(5 635) 11 597 (5 378) 2 821

Other comprehensive income for the year, net of tax 342 12 015 599 3 239

Total comprehensive income for the year 203 039 105 928 155 109 64 041

Profit for the year from continuing operations attributable to: Shareholders of Crookes Brothers Limited 79 144 88 149 30 755 54 231Non-controlling interests 446 214 – –

79 590 88 363 30 755 54 231

Profit/(loss) for the year from discontinued operations attributable to:Shareholders of Crookes Brothers Limited 122 002 6 071 123 755 6 571 Non-controlling interests 1 105 (521) – –

123 107 5 550 123 755 6 571

Total comprehensive income for the year from continuing operations attributable to: Shareholders of Crookes Brothers Limited 79 486 100 164 31 354 57 470 Non-controlling interests 446 214 – –

79 932 100 378 31 354 57 470

Total comprehensive income for the year from discontinued operations attributable to: Shareholders of Crookes Brothers Limited 122 002 6 071 123 755 6 571 Non-controlling interests 1 105 (521) – –

123 107 5 550 123 755 6 571

Earnings per share From continuing and discontinued operations

Basic (cents) 11.1 1 609,0 760,8Diluted (cents) 11.2 1 580,4 749,3

From continuing operations Basic (cents) 11.1 633,1 711,7Diluted (cents) 11.2 621,9 701,0

Headline earnings per share Basic (cents) 676,8 753,5Diluted (cents) 664,7 742,2

* Restatement to account for discontinued operations and change in accounting policy.

for the year ended 31 March 2014PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME

CONSOLIDATED STATEMENT OF



as at 31 March 2014FINANCIAL POSITION


GROUP COMPANY

2014 2013* 2014 2013*Note R’000 R’000 R’000 R’000

ASSETS Non-current assets 680 148 453 162 594 977 370 034

Property, plant and equipment 14 460 961 285 614 180 261 146 391 Bearer biological assets 15.1 192 883 145 518 136 961 108 978 Unlisted investments 16.1 979 5 517 979 5 516Investment in associates 16.2 18 681 15 310 17 186 14 936 Investment in subsidiaries 16.3.2 – – 252 946 93 010Retirement benefit surplus 25 5 990 – 5 990 –Unsecured loans – long-term 17 654 1 203 654 1 203

Current assets 345 722 350 281 171 838 205 408

Inventories 18 52 808 29 444 30 143 24 561 Biological assets – crops 15.1 189 808 179 506 91 501 81 465 – livestock 15.2 954 970 954 970Trade and other receivables 19 55 171 29 159 30 417 19 627 Taxation – 491 – –Other financial assets 20 14 636 52 926 – 44 840 Unsecured loans – short-term 17 3 498 328 3 498 –Cash and cash equivalents 28 847 36 620 15 325 13 108

345 722 329 444 171 838 184 571 Assets classified as held for sale 10 – 20 837 – 20 837

Total assets 1 025 870 803 443 766 815 575 442

EQUITY AND LIABILITIES Capital and reserves 763 778 584 549 526 193 391 964

Share capital 21.1 3 137 3 096 3 137 3 096 Share premium 21.1 8 972 112 8 972 112 Investment revaluation reserve 21.1 1 058 6 436 1 058 6 436 Foreign currency translation reserve 21.1 4 846 5 103 – –Share-based payment reserve 21.1 792 720 792 720Retained earnings 742 804 565 534 512 234 381 600

Equity attributable to owners of the company 761 609 581 001 526 193 391 964 Non-controlling interests 21.2 2 169 3 548 – –

Non-current liabilities 178 535 164 089 113 965 93 936

Deferred taxation 8.3 107 199 88 427 66 921 54 968 Long-term borrowings: interest-bearing 22.2 19 955 13 513 – –Long-term liability: interest-free 22.2 41 763 51 635 37 426 28 454 Post-employment obligations 25 9 618 10 514 9 618 10 514

Current liabilities 83 557 54 805 126 657 89 542

Trade and other payables 23 26 517 26 579 12 025 14 372 Short-term borrowings: interest-bearing 21.1 34 178 15 911 27 393 11 477 Provisions 24 13 339 11 918 9 144 8 036Outside shareholders’ loan 470 397 – –Taxation 9 053 – 8 375 973 Amounts owing to subsidiaries 16.3.2 – – 69 720 54 684

Total equity and liabilities 1 025 870 803 443 766 815 575 442


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for the year ended 31 March 2014CASH FLOWS


GROUP COMPANY

2014 2013* 2014 2013*R’000 R’000 R’000 R’00

Operating activities Operating profit for the year from continuing operations 90 765 85 843 32 192 39 760 Operating profit for the year from discontinued operations 16 063 7 698 13 112 9 126 Other comprehensive income 8 301 581 8 301 581 Adjustment for non-cash items:Depreciation 24 953 18 656 12 241 9 596 Adjustment to foreign currency translation reserve 210 (5 438) – –(Loss)/profit on disposal of property, plant and equipment (230) (1 178) 273 (280) Net (decrease)/increase in provision for post-employment medical aid benefits (896) 913 (896) 913 Decrease in provision for retirement funds benefits (5 990) (2 809) (5 990) (2 809) Change in fair value of livestock biological assets 16 842 16 842 Change in fair value of crops biological assets (excluding expansions) (65 822) (38 141) (35 985) (12 575) Increase/(decrease) in provisions 1 791 (1 803) 1 108 (1 585) Share-based payment expense 72 169 72 169

Operating cash flows before movements in working capital 69 233 65 333 24 444 43 738 Increase in inventories (24 480) (3 977) (5 582) (2 938) (Increase)/decrease in trade and other receivables (26 059) 14 159 (10 790) 17 294 Net increase in amounts owing to and from subsidiaries – – (92 548) (15 148) Increase/(decrease) in trade and other payables 757 1 658 (2 347) 2 237

Cash generated from/(utilised in) operations 19 451 77 173 (86 823) 45 183 Finance costs (4 538) (2 183) (1 465) (1 466) Taxation paid (16 781) (17 431) (15 297) (15 939)

Net cash flows from operating activities (1 868) 57 559 (103 585) 27 778

Investing activities Interest received 8 146 33 754 8 890 35 114 Dividends received 78 1 532 78 1 532 Net proceeds on redemption of investments 42 533 62 204 51 898 62 204 Proceeds on disposal of livestock 5 461 – 5 461 –Consideration on disposal of property, plant and equipment 142 779 1 968 142 119 671 Increase in unsecured loans (2 621) (93) (2 950) (265) Payments for plant and equipment (111 973) (78 484) (46 993) (23 264) Payments for property, plant and equipment in business combinations** (90 000) – – –Investment in foreign subsidiaries – – (52 352) (32 806) Net cash outflow on disposal of subsidiary (note 16.3.5) (6 553) – – –Investment in expansion of area under crop (2 034) (11 326) (2 034) (7 247) Net consideration paid for biological assets on acquired farms (12 599) – – –Purchases of livestock biological assets – (117) – (117) Investment in associate companies (2 250) (1 895) (2 250) (1 895)

Net cash (used in)/generated by investing activities (29 033) 7 543 101 867 33 927

Financing activities Net increase in long-term borrowings 18 709 3 601 8 972 2 497 Net increase/(decrease) in short-term borrowings 25 299 (25 235) 15 916 (24 911) Net increase in outside shareholders’ loans 73 397 – –Cash dividends paid – prior financial year final (10 916) (16 720) (10 916) (16 720) Cash dividends paid – current financial year interim (10 037) (9 908) (10 037) (9 908)

Net cash generated by/(used in) financing activities 23 128 (47 865) 3 935 (49 042)

Net (decrease)/increase in cash and cash equivalents (7 773) 17 237 2 217 12 663 Cash and cash equivalents at beginning of the year 36 620 19 383 13 108 445

Cash and cash equivalents at end of the year 28 847 36 620 15 325 13 108

* Restatement to account for discontinued operations and change in accounting policies.** The consideration of R90 million for property, plant and equipment acquired in the High Noon deciduous farm acquisition (note 29).



for the year ended 31 March 2014CHANGES IN EQUITY


Share capital

and premium

Investment revaluation

reserve

Share-based

payment reserve

Foreign currency

translation reserve

Retained earnings

Attributable to owners

of the company

Non-controlling interest in subsidiary Total

R’000 R’000 R’000 R’000 R’000 R’000 R’000 R’000

GROUP Balance at 1 April 2012* (as previously reported) 3 208 3 615 551 (3 673) 496 039 499 740 3 855 503 595 Adjustments (refer note 1.3) – – – – 1 485 1 485 – 1 485

Balance at 1 April 2012 (restated) 3 208 3 615 551 (3 673) 497 524 501 225 3 855 505 080 Net profit attributable to shareholders – – – – 94 220 94 220 (307) 93 913 Other comprehensive income – 2 821 – 8 776 418 12 015 – 12 015

Total comprehensive income/(loss) for the year – 2 821 – 8 776 94 638 106 235 (307) 105 928 Dividends declared and paid (note 12) – – – – (26 628) (26 628) – (26 628) Share-based payment expense – – 169 – – 169 – 169

Balance at 31 March 2013* (restated) 3 208 6 436 720 5 103 565 534 581 001 3 548 584 549 Net profit attributable to shareholders – – – – 201 146 201 146 1 551 202 697 Other comprehensive (loss)/income – (5 378) – (257) 5 977 342 – 342

Total comprehensive (loss)/income for the year – (5 378) – (257) 207 123 201 488 1 551 203 039 Dividends declared (note 12) – – – – (29 853) (29 853) – (29 853) Capitalisation share issue – final 2013 dividend (note 12) 8 901 – – – – 8 901 – 8 901 Change in non-controlling shareholding – – (2 930) (2 930) Share-based payment expense – – 72 – – 72 – 72

Balance at 31 March 2014 12 109 1 058 792 4 846 742 804 761 609 2 169 763 778

Note 21.1 21.1 21.1 21.1 21.2

COMPANYBalance at 31 March 2012* (as previously reported) 3 208 3 615 551 – 345 523 352 897 – 352 897 Adjustments (refer note 1.3) – – – – 1 485 1 485 – 1 485

Balance at 1 April 2012 (restated) 3 208 3 615 551 – 347 008 354 382 – 354 382 Net profit attributable to shareholders – – – – 60 802 60 802 – 60 802 Other comprehensive income – 2 821 – – 418 3 239 – 3 239

Total comprehensive income for the year – 2 821 – – 61 220 64 041 – 64 041 Dividends declared and paid (note12) – – – – (26 628) (26 628) – (26 628) Share-based payment expense – – 169 – – 169 – 169

Balance at 31 March 2013* (restated) 3 208 6 436 720 – 381 600 391 964 – 391 964 Net profit attributable to shareholders – – – – 154 510 154 510 – 154 510 Other comprehensive (loss)/income for the year, net of income tax – (5 378) – – 5 977 599 – 599

Total comprehensive (loss)/income for the year – (5 378) – – 160 487 155 109 – 155 109 Dividends declared (note 12) – – – – (29 853) (29 853) – (29 853) Capitalisation share issue – final 2013 dividend (note 12) 8 901 – – – – 8 901 – 8 901 Share-based payment expense – – 72 – – 72 – 72

Balance at 31 March 2014 12 109 1 058 792 – 512 234 526 193 – 526 193

Note 21.1 21.1 21.1 21.1 * Restatement to account for discontinued operations and change in accounting policy.

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for the year ended 31 March 2014NOTES TO THE FINANCIAL STATEMENTS

GENERAL INFORMATION Crookes Brothers Limited (the company) is a limited company incorporated in the Republic of South Africa. The addresses of its registered office and principal place of business are disclosed on the inside back cover of the integrated annual report. The principal activities of the company and its subsidiaries (the group) are described in the Directors’ report of the Integrated Annual Report.

1. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) 1.1 New and revised IFRSs affecting amounts reported and/or disclosures in the financial statements In the current year, the group has applied a number of new and revised IFRSs issued by the International Accounting Standards Board (IASB)

that are mandatorily effective for an accounting period that begins on or after 1 January 2013.

1.2 Amendments to IFRS 7 Disclosures – Offsetting Financial Assets and Financial Liabilities The group has applied the amendments to IFRS 7 Disclosures – Offsetting Financial Assets and Financial Liabilities for the first time in the

current year. The amendments to IFRS 7 require entities to disclose information about rights of offset and related arrangements (such as collateral posting requirements) for financial instruments under an enforceable master netting agreement or similar arrangement.

As the group does not have any offsetting arrangements in place, the application of the amendments has had no material impact on the disclosures or on the amounts recognised in the consolidated financial statements.

1.3 New and revised Standards on consolidation, joint arrangements, associates and disclosures In May 2011, a package of five standards on consolidation, joint arrangements, associates and disclosures was issued comprising IFRS 10

Consolidated Financial Statements, IFRS 11 Joint Arrangements, IFRS 12 Disclosure of Interests in Other Entities, IAS 27 (as revised in 2011) Separate Financial Statements and IAS 28 (as revised in 2011) Investments in Associates and Joint Ventures. Subsequent to the issue of these standards, amendments to IFRS 10, IFRS 11 and IFRS 12 were issued to clarify certain transitional guidance on the first-time application of the standards.

In the current year, the group has reviewed its application of IFRS 10, IFRS 11, IFRS 12 and IAS 28 (as revised in 2011) together with the amendments to IFRS 10, IFRS 11 and IFRS 12 regarding the transitional guidance. IAS 27 (as revised in 2011) is not applicable to the group as it deals only with separate financial statements.

The impact of the application of these standards is set out below.

Impact of the application of IFRS 10 IFRS 10 replaces the parts of IAS 27 Consolidated and Separate Financial Statements that deal with consolidated financial statements and

SIC-12 Consolidation – Special Purpose Entities. IFRS 10 changes the definition of control such that an investor has control over an investee when a) it has power over the investee, b) it is exposed, or has rights, to variable returns from its involvement with the investee and c) it has the ability to use its power to affect its returns. All three of these criteria must be met for an investor to have control over an investee. Previously, control was defined as the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. Additional guidance has been included in IFRS 10 to explain when an investor has control over an investee. Some guidance included in IFRS 10 that deals with whether or not an investor that owns less than 50% of the voting rights in an investee has control over the investee is relevant to the group.

Specifically, the group has a 45% ownership interest in Mthayiza Farming (Pty) Ltd and had a 49% ownership interest in Kwacele Farming (Pty) Ltd. The group’s 45% ownership interest in Mthayiza Farming (Pty) Ltd gives the group the same percentage of the voting rights in Mthayiza Farming (Pty) Ltd. There has been no change in the group’s ownership in Mthayiza Farming (Pty) Ltd since the initial date of acquisition. The remaining 55% of the ordinary shares of Mthayiza Farming (Pty) Ltd are owned by the Libuyile Community Trust. During the 2014 financial year, the group disposed of its 49% ownership interest in Kwacele Farming (Pty) Ltd.

The directors of the company made an assessment as at the date of initial application of IFRS 10 (i.e. 1 January 2013) as to whether or not the group has control over Mthayiza Farming (Pty) Ltd and Kwacele Farming (Pty) Ltd in accordance with the new definition of control and the related guidance set out in IFRS 10. The directors concluded that it has had control over Mthayiza Farming (Pty) Ltd and Kwacele Farming (Pty) Ltd since acquisition, based on the contractual arrangement between the group and other investors, as well as the fact that the group runs the operations of these companies on a daily basis. In addition, the group controls the budgets, capital and operating expenditure spend and decides the planting methods deployed on the farms. Therefore, in accordance with the requirements of IFRS 10, Mthayiza Farming (Pty) Ltd and Kwacele Farming (Pty) Ltd have been subsidiaries of the company since acquisition.

Impact of the application of IFRS 11 IFRS 11 replaces IAS 31 Interests in Joint Ventures, and the guidance contained in a related interpretation, SIC-13 Jointly Controlled Entities –

Non-Monetary Contributions by Venturers, has been incorporated in IAS 28 (as revised in 2011). IFRS 11 deals with how a joint arrangement over which two or more parties have joint control should be classified and accounted for. Under IFRS 11, there are only two types of joint arrangements – joint operations and joint ventures. The classification of joint arrangements under IFRS 11 is determined based on the rights and obligations of parties to the joint arrangements by considering the structure, the legal form of the arrangements, the contractual terms agreed by the parties to the arrangement, and, when relevant, other facts and circumstances. A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement (i.e. joint operators) have rights to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement whereby the parties that have joint control of the arrangement (i.e. joint venturers) have rights to the net assets of the arrangement. Previously, IAS 31 contemplated three types of joint arrangements – jointly controlled entities, jointly controlled operations and jointly controlled assets. The classification of joint arrangements under IAS 31 was primarily determined based on the legal form of the arrangement (e.g. a joint arrangement that was established through a separate entity was accounted for as a jointly controlled entity).

The group does not hold any interests in any joint ventures or jointly controlled entities as prescribed by IFRS 11.



NOTES TO THE FINANCIAL STATEMENTS

Impact of the application of IFRS 12 IFRS 12 is a new disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/

or unconsolidated structured entities. In general, the application of IFRS 12 has resulted in more extensive disclosures in the consolidated financial statements (please see note 16 for details).

IFRS 13 Fair Value Measurement The group has applied IFRS 13 for the first time in the current year. IFRS 13 establishes a single source of guidance for fair value measurements

and disclosures about fair value measurements. The scope of IFRS 13 is broad; the fair value measurement requirements of IFRS 13 apply to both financial instrument items and non-financial instrument items for which other IFRSs require or permit fair value measurements and disclosures about fair value measurements, except for share-based payment transactions that are within the scope of IFRS 2 Share-based Payments, leasing transactions that are within the scope of IAS 17 Leases, and measurements that have some similarities to fair value but are not fair value (e.g. net realisable value for the purposes of measuring inventories or value in use for impairment assessment purposes).

IFRS 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions. Fair value under IFRS 13 is an exit price regardless of whether that price is directly observable or estimated using another valuation technique. Also, IFRS 13 includes extensive disclosure requirements.

IFRS 13 requires prospective application from 1 January 2013. In addition, specific transitional provisions were given to entities such that they need not apply the disclosure requirements set out in the Standard in comparative information provided for periods before the initial application of the Standard. Other than the additional disclosures, the application of IFRS 13 has not had any material impact on the amounts recognised in the consolidated financial statements.

Amendments to IAS 1 Presentation of Items of Other Comprehensive Income The group has applied the amendments to IAS 1 Presentation of Items of Other Comprehensive Income for the first time in the current

year. The amendments introduce new terminology, whose use is not mandatory, for the statement of comprehensive income and income statement. Under the amendments to IAS 1, the ‘statement of comprehensive income’ is renamed as the ‘statement of profit or loss and other comprehensive income’ (and the ‘income statement’ is renamed as the ‘statement of profit or loss’). The amendments to IAS 1 retain the option to present profit or loss and other comprehensive income in either a single statement or in two separate but consecutive statements. However, the amendments to IAS 1 require items of other comprehensive income to be grouped into two categories in the other comprehensive income section: (a) items that will not be reclassified subsequently to profit or loss and (b) items that may be reclassified subsequently to profit or loss when specific conditions are met. Income tax on items of other comprehensive income is required to be allocated on the same basis – the amendments do not change the option to present items of other comprehensive income either before tax or net of tax. The amendments have been applied retrospectively, and hence the presentation of items of other comprehensive income has been modified to reflect the changes. Other than the above-mentioned presentation changes, the application of the amendments to IAS 1 does not result in any impact on profit or loss, other comprehensive income and total comprehensive income.

Amendments to IAS 1 Presentation of Financial Statements (as part of the Annual Improvements to IFRSs 2009 – 2011 Cycle issued in May 2012) The Annual Improvements to IFRSs 2009 – 2011 have made a number of amendments to IFRSs. The amendments that are relevant to the

group are the amendments to IAS 1 regarding when a statement of financial position as at the beginning of the preceding period (third statement of financial position) and the related notes are required to be presented. The amendments specify that a third statement of financial position is required when a) an entity applies an accounting policy retrospectively, or makes a retrospective restatement or reclassification of items in its financial statements, and b) the retrospective application, restatement or reclassification has a material effect on the information in the third statement of financial position. The amendments specify that related notes are not required to accompany the third statement of financial position.

In the current year, the group has applied a number of new and revised IFRSs, which has resulted in amendments on the information in the consolidated statement of financial position as at 1 April 2013. In accordance with the amendments to IAS 1, the group has not presented a third statement of financial position as at 1 April 2012 (refer note 1.3) except for the disclosure requirements of IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors. The amendments are considered immaterial to the group.

IAS 19 (as revised in 2011) changes the accounting for defined benefit plans and termination benefits. The most significant change relates to the accounting for changes in defined benefit obligations and plan assets. The amendments require the recognition of changes in defined benefit obligations and in the fair value of plan assets when they occur, and hence eliminate the ‘corridor approach’ permitted under the previous version of IAS 19 and accelerate the recognition of past service costs. All actuarial gains and losses are recognised immediately through other comprehensive income in order for the net pension asset or liability recognised in the consolidated statement of financial position to reflect the full value of the plan deficit or surplus. Furthermore, the interest cost and expected return on plan assets used in the previous version of IAS 19 are replaced with a ‘net interest’ amount under IAS 19 (as revised in 2011), which is calculated by applying the discount rate to the net defined benefit liability or asset. These changes have had an impact on the amounts recognised in profit or loss and other comprehensive income in prior years. In addition, IAS 19 (as revised in 2011) introduces certain changes in the presentation of the defined benefit cost, including more extensive disclosures.

Specific transitional provisions are applicable to first-time application of IAS 19 (as revised in 2011). The group has applied the relevant transitional provisions and restated the comparative amounts on a retrospective basis (see the tables on the next page for details).

14


1. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) continued 1.3 New and revised Standards on consolidation, joint arrangements, associates and disclosures continued Impact of the application of IAS 19 (as revised in 2011) on total comprehensive income for the year

2014 2013R’000 R’000

Impact on profit/(loss) for the yearIncrease in administration expenses – defined benefit obligations (6 592) (460)(Increase)/decrease in administration expenses – post-retirement medical obligation (1 710) 1 082Decrease/(increase) in income tax expense 2 325 (174)

(Decrease)/increase in profit for the year (5 977) 448

Impact on other comprehensive incomeDecrease in remeasurement of defined benefit obligation 6 592 1 662 Decrease/(increase) in remeasurement of post-retirement medical obligation 1 710 (1 082) Increase in income tax relating to items of other comprehensive income (2 325) (162)

Increase in other comprehensive income for the year 5 977 418

Increase in total comprehensive income for the year – 866

(Decrease)/increase in profit for the year attributable to:Owners of the company (5 977) 448 Non-controlling interests – –

(5 977) 448

Increase in total comprehensive income for the year attributable to:Owners of the company – 866 Non-controlling interests – –

– 866




Impact of the application of these Standards on assets, liabilities and equity as at 1 April 2012

As at 1 April 2012as previously

reportedIAS 19

adjustments

As at 1 April 2012

as restated

Property, plant and equipment 236 952 – 236 952Bearer biological assets 116 000 – 116 000Unlisted investments 3 769 – 3 769Investment in associates 13 257 – 13 257Unsecured loans – long-term 938 – 938Inventories 25 467 – 25 467Biological assets – crops 157 224 – 157 224Biological assets – livestock 7 156 – 7 156Trade and other receivables 43 318 – 43 318Taxation 1 572 – 1 572Other financial assets 101 756 – 101 756Unsecured loans – short-term 500 – 500Cash and cash equivalents 19 383 – 19 383Assets classified as held for sale 3 564 – 3 564Deferred taxation (71 456) (576) (72 032)Long-term borrowings: interest-bearing (16 373) – (16 373)Long-term liability: interest-free (45 174) – (45 174)Post-employment obligations (14 470) 2 061 (12 409)Trade and other payables (24 921) – (24 921)Short-term borrowings: interest-bearing (41 146) – (41 146)Provisions (13 721) – (13 721)

Total effect on net assets 503 595 1 485 505 080

Share capital (3 096) – (3 096)Share premium (112) – (112)Investment revaluation reserve (3 615) – (3 615)Foreign currency translation reserve 3 673 – 3 673Share-based payment reserve (551) – (551)Retained earnings (496 039) (1 485) (497 524)Non-controlling interests (3 855) – (3 855)

Total effect on equity (503 595) (1 485) (505 080)

16


1. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS (IFRS) continued 1.3 New and revised Standards on consolidation, joint arrangements, associates and disclosures continued Impact of the application of these Standards on assets, liabilities and equity as at 31 March 2013

As at 31 March 2013

as previously reported

IAS 19 adjustments

As at 31 March 2013

as restated

Property, plant and equipment 285 614 – 285 614Bearer biological assets 145 518 – 145 518Unlisted investments 5 517 – 5 517Investment in associates 15 310 – 15 310Unsecured loans – long-term 1203 – 1 203Inventories 29 444 – 29 444Biological assets – crops 179 506 – 179 506Biological assets – livestock 970 – 970Trade and other receivables 29 159 – 29 159Taxation 491 – 491Other financial assets 52 926 – 52 926Unsecured loans – short-term 328 – 328Cash and cash equivalents 36 620 – 36 620Assets classified as held for sale 20 837 – 20 837Deferred taxation (87 514) (913) (88 427)Long-term borrowings: interest-bearing (13 513) – (13 513)Long-term liability: interest-free (51 635) – (51 635)Post-employment obligations (13 778) 3 264 (10 514)Trade and other payables (26 579) – (26 579)Short-term borrowings: interest-bearing (15 911) – (15 911)Provisions (11 918) – (11 918)Outside shareholders’ loan (397) – (397)

Total effect on net assets 582 198 2 351 584 549

Share capital (3 096) – (3 096)Share premium (112) – (112)Investment revaluation reserve (6 436) – (6 436)Foreign currency translation reserve (5 103) – (5 103)Share-based payment reserve (720) – (720)Retained earnings (563 183) (2 351) (565 534)Non-controlling interests (3 548) – (3 548)

Total effect on equity (582 198) (2 351) (584 549)

The impact of the application of the new and revised standards on basic and diluted earnings per share is disclosed in note 11.




2. SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation The financial statements are prepared in accordance with International Financial Reporting Standards (IFRS) and interpretations of those

standards as issued by the IFRS Interpretations Committee (IFRIC), containing the information required by the Companies Act of South Africa, as well as the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and the Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council. The consolidated financial statements have been prepared on the historical cost basis except for biological assets and certain financial instruments that are measured at revalued amounts or fair values at the end of each reporting period, as explained in the accounting policies below.

Historical cost is generally based on the fair value of the consideration given in exchange for goods and services.

Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope of IAS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in IAS 2 or value in use in IAS 36.

The principal accounting policies adopted are set out below.

2.2 Basis of consolidation The consolidated financial statements incorporate the financial statements of the company and entities controlled by the company. Control is

achieved when the company:

• has power over the investee; • is exposed, or has rights, to variable returns from its involvement with the investee; and • has the ability to use its power to affect its returns.

The company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.

When the company has less than a majority of the voting rights of an investee, it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The company considers all relevant facts and circumstances in assessing whether or not the company’s voting rights in an investee are sufficient to give it power, including:

• the size of the company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders; • potential voting rights held by the company, other vote holders or other parties; • rights arising from other contractual arrangements; and • any additional facts and circumstances that indicate that the company has, or does not have, the current ability to direct the relevant

activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.

Consolidation of a subsidiary begins when the company obtains control over the subsidiary and ceases when the company loses control of the subsidiary. Specifically, income and expenses of a subsidiary acquired or disposed of during the year are included in the consolidated statement of profit or loss and other comprehensive income from the date the company gains control until the date when the company ceases to control the subsidiary.

Profit or loss and each component of other comprehensive income are attributed to the owners of the company and to the non-controlling interests. Total comprehensive income of subsidiaries is attributed to the owners of the company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies in line with the group’s accounting policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between members of the group are eliminated in full on consolidation.

Changes in the group’s ownership interests in existing subsidiaries Changes in the group’s ownership interests in subsidiaries that do not result in the group losing control over the subsidiaries are accounted for

as equity transactions. The carrying amounts of the group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the company.

When the group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests. All amounts previously recognised in other comprehensive income in relation to that subsidiary are accounted for as if the group had directly disposed of the related assets or liabilities of the subsidiary (i.e. reclassified to profit or loss or transferred to another category of equity as specified/permitted by applicable IFRSs). The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IAS 39, when applicable, Cost on Initial Recognition of an Investment in an Associate or a Joint Venture.

18


2. SIGNIFICANT ACCOUNTING POLICIES continued 2.2 Basis of consolidation continued Non-controlling interests in subsidiaries are identified separately from the group’s equity therein. The interest of non-controlling shareholders

is initially measured at the non-controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets. Subsequent to acquisition, the non-controlling interest consists of the amount of those interests at acquisition plus the non-controlling interests’ share of changes in equity in the subsidiary. Non-controlling interests are allocated their proportionate share of total comprehensive income even if this results in the non-controlling interest having a deficit, unless there is doubt as to the recoverability of the deficit.

2.3 Business combinations Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is

measured at fair value, which is calculated as the sum of the acquisition date fair values of the assets transferred by the group, the liabilities incurred by the group and the equity interests issued by the group in exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or loss as incurred.

At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value, except that:

• deferred tax assets or liabilities, and assets or liabilities related to employee benefit arrangements are recognised and measured in accordance with IAS 12 Income Taxes and IAS 19 respectively;

• liabilities or equity instruments related to share-based payment arrangements of the acquiree or share-based payment arrangements of the group entered into to replace share-based payment arrangements of the acquiree are measured in accordance with IFRS 2 at the acquisition date; and

• assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 Non-current Assets Held for Sale and Discontinued Operations are measured in accordance with that Standard.

Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer’s previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer’s previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.

Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any.

For the purposes of impairment testing, goodwill is allocated to each of the group’s cash-generating units (or groups of cash-generating units) that is expected to benefit from the synergies of the combination.

A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.

On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.

2.4 Investments in associates An associate is an entity over which the group has significant influence and that is neither a subsidiary nor an interest in a joint venture.

Significant influence is the power to participate in the financial and operating policy decisions of the investee but is not control or joint control over those policies.

The results, assets and liabilities of associate companies are incorporated in these financial statements using the equity method of accounting, except where the investment is classified as held for sale, in which case it is accounted for under IFRS 5 Non-current Assets Held for Sale and Discontinued Operations. Under the equity method, investments in associates are initially recognised at cost and adjusted thereafter to recognise the group’s share of the profit or loss and other comprehensive income of the associate. Losses of an associate in excess of the group’s interest in that associate are not recognised unless there is a commitment or guarantee that requires further funding from the group.

2.5 Non-current assets held for sale Non-current assets and 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. This condition is regarded as met only when the asset (or disposal group) is available for immediate sale in its present condition, subject only to terms that are usual and customary for sales of such asset (or disposal group), and its sale is highly probable. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification.




2.5 Non-current assets held for sale continued When the group is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are

classified as held for sale when the criteria described above are met, regardless of whether the group will retain a non-controlling interest in its former subsidiary after the sale.

When the group is committed to a sale plan involving disposal of an investment, or a portion of an investment, in an associate or joint venture, the investment or the portion of the investment that will be disposed of is classified as held for sale when the criteria described above are met, and the group discontinues the use of the equity method in relation to the portion that is classified as held for sale. Any retained portion of an investment in an associate or a joint venture that has not been classified as held for sale continues to be accounted for using the equity method. The group discontinues the use of the equity method at the time of disposal when the disposal results in the group losing significant influence over the associate or joint venture.

After the disposal takes place, the group accounts for any retained interest in the associate or joint venture in accordance with IAS 39 unless the retained interest continues to be an associate or a joint venture, in which case the group uses the equity method (see the accounting policy regarding investments in associates or joint ventures above).

Non-current assets (and disposal groups) classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs to sell.

2.6 Revenue recognition Revenue is measured at the fair value of the consideration received or receivable. Revenue is reduced for estimated customer returns, rebates

and other similar allowances.

Sale of goods Revenue from the sale of goods is recognised when the goods are delivered and titles have passed, at which time all the following conditions

are satisfied:

• The group has transferred to the buyer the significant risks and rewards of ownership of the goods; • The group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over

the goods sold; • The amount of revenue can be measured reliably; • It is probable that the economic benefits associated with the transaction will flow to the group; and • The costs incurred or to be incurred in respect of the transaction can be measured reliably.

Dividend and interest income Dividend income from investments is recognised when the shareholder’s right to receive payment has been established (provided that it is

probable that the economic benefits will flow to the group and the amount of income can be measured reliably).

Interest income from a financial asset is recognised when it is probable that the economic benefits will flow to the group and the amount of income can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on initial recognition.

2.7 Leases Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee.

All other leases are classified as operating leases.

A lease of land and buildings is classified by considering the land and buildings elements separately. Minimum lease payments are allocated between the land and buildings elements in proportion to the relative fair values of the leasehold interest in the land and buildings elements of the lease at inception of the lease.

Group as lessee Finance leases Assets held under finance leases are recognised as assets of the group at their fair value at the inception of the lease or, if lower, at the present

value of the minimum lease payments. The corresponding liability to the lessor is included in the statement of financial position as a finance lease obligation. Lease payments are apportioned between finance charges and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are charged to profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the group’s general policy on borrowing costs.

Operating leases Rentals payable under operating leases are charged to profit or loss on a straight-line basis over the term of the relevant lease.

Group as lessor Operating leases Operating lease income is recognised in profit or loss on a straight-line basis over the term of the lease.

20


2. SIGNIFICANT ACCOUNTING POLICIES continued

2.8 Foreign currencies The individual financial statements of each group entity are presented in the currency of the primary economic environment in which the

entity operates (its functional currency). For the purposes of the consolidated financial statements, the results and financial position of each entity are expressed in South African Rand, which is the functional currency of the company and the presentation currency for the consolidated financial statements.

For the purposes of presenting these consolidated financial statements, the assets and liabilities of the group’s foreign operations are translated into Rands using exchange rates prevailing at the end of each reporting period. Income and expense items are translated at the average exchange rates for the period, unless exchange rates fluctuate significantly during that period, in which case the exchange rates at the dates of the transactions are used. Exchange differences arising, if any, are recognised in other comprehensive income and transferred to the group’s foreign currency translation reserve. Such translation differences are recognised in profit or loss in the period in which the foreign operation is disposed of.

In preparing the financial statements of the individual entities, transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the dates of the transactions. At the end of each reporting date, monetary items denominated in foreign currencies are retranslated at the rates prevailing on that date. Non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates prevailing on the date when the fair value was determined. Non-monetary items that are measured in terms of historic cost in a foreign currency are not translated.

Exchange differences that arise on the settlement of monetary items, and on the translation of monetary items, are included in profit and loss in the period that they arise.

2.9 Retirement benefit costs The group provides retirement benefits for its employees through a number of defined contribution and defined benefit plans.

Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions. Contributions made to state-managed retirement benefit schemes are dealt with as payments to defined contribution plans where the group’s obligations under the plans are equivalent to those arising in a defined contribution retirement benefit plan.

For defined benefit retirement plans, the cost of providing benefits is determined using the projected unit credit method, with actuarial valuations being carried out at the end of each annual reporting period. Remeasurement, comprising actuarial gains and losses, the effect of the changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected immediately in the statement of financial position, with a charge or credit recognised in other comprehensive income in the period in which they occur. Remeasurement recognised in other comprehensive income is reflected immediately in retained earnings and will not be reclassified to profit or loss. Past service cost is recognised in profit or loss in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset. Defined benefit costs are categorised as follows:

• service cost (including current service cost, past service cost, as well as gains and losses on curtailments and settlements); • net interest expense or income; and • remeasurement.

The retirement benefit obligation recognised in the consolidated statement of financial position represents the actual deficit or surplus in the group’s defined benefit plans. Any surplus resulting from this calculation is limited to the present value of any economic benefits available in the form of refunds from the plans or reductions in future contributions to the plans.

Actuarial gains and losses are recognised in other comprehensive income.

Past service cost is recognised immediately to the extent that the benefits are already vested, or otherwise is amortised on the straight-line basis over the average period until the benefits become vested.

All plans are funded. Funding shortfalls arising in defined benefit plans are met by lump sum payments or increased future contributions.

Additional severance liabilities in terms of legislative regulations are assessed annually and provided for.

Historically, qualifying employees have been granted certain post-retirement medical benefits. Although the post-retirement medical benefit option is now closed, a liability still exists in respect of current and retired employees to whom the benefit was granted. These costs are provided on the accrual basis, determined actuarially.

2.10 Share-based payment arrangements Equity-settled share-based payments to employees and others providing similar services are measured at the fair value of the equity instruments

at the grant date. Details regarding the determination of the fair value of equity-settled share-based transactions are set out in note 26.

The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the group’s estimate of equity instruments that will eventually vest, with a corresponding increase in equity. At the end of each reporting period, the group revises its estimate of the number of equity instruments expected to vest. The impact of the revision of the original estimates, if any, is recognised in profit or loss such that the cumulative expense reflects the revised estimate, with a corresponding adjustment to the equity-settled employee benefits reserve.




The group issues equity-settled share-based payments to certain employees in terms of the Crookes Brothers Share Option Scheme. Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date is expensed on a straight-line basis over the vesting period, based on the group’s estimate of the shares that will eventually vest and adjusted for the effect of non-market-based vesting conditions.

Fair value is measured using the Black-Scholes pricing model.

2.11 Dividends Dividends declared by the company to its shareholders are charged against reserves in the period declared, and raised as an outstanding

payable until settled.

Where the company offers shareholders an option between receiving a cash consideration or a scrip dividend, the group applies IAS1: 137, where the gross ‘cash equivalent’ amount of the dividend is reflected as a debit to distributable reserves in the statement of changes in equity. The scrip element of the dividend is separately accounted for as a credit in the statement of changes in equity, attributable to the owners of the company.

2.12 Taxation Income tax expense represents the sum of the tax currently payable and deferred tax.

The tax currently payable is based on taxable profit for the period. Taxable profit differs from profit as reported in profit or loss because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the period end date.

Deferred taxation is recognised on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such deferred tax assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets or liabilities in a transaction that affects neither taxable profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is measured at the tax rates that are expected to apply in the period when the liability is settled or the asset realised. Deferred tax is recognised in profit or loss, except when it relates to items that are recognised in other comprehensive income or directly in equity, in which case the deferred tax is also recognised in other comprehensive income or directly in equity respectively.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when they relate to income taxes levied by the same taxation authority and the group intends to settle its current tax assets and liabilities on a net basis.

2.13 Property, plant and equipment Property, plant and equipment are stated at cost less accumulated depreciation and any accumulated impairment losses. Cost includes

professional fees and for qualifying assets, borrowing costs capitalised in accordance with the group’s accounting policy.

The cost of property, plant and equipment includes directly attributable costs incurred in the acquisition and installation of such assets, as well as the present value of the estimated cost of dismantling, removal or site restoration costs if applicable, so as to bring the assets to the location and condition necessary for them to be capable of operating in the manner intended by management.

The cost of small parts as well as repairs and maintenance costs are recognised in profit or loss as incurred.

Assets in the course of construction are carried at cost, less any impairment loss.

Depreciation is charged so as to write off the cost of the assets to their residual value over their estimated useful lives, using the straight- line method. Depreciation commences when the assets are ready for their intended use and is calculated at rates appropriate in terms of management’s current assessment of useful lives and residual values. Depreciation ceases at the earlier of the date the asset is classified as held for sale or at the date it is derecognised. Freehold land and leasehold land with indefinite lease periods are not depreciated and are stated at cost less accumulated impairment losses.

Leasehold property rights are stated at cost.

Management reviews the residual lives and depreciation methods annually, considering market conditions and projected disposal values. In the assessment of useful lives, maintenance programmes and technological innovations are considered.

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, the term of the relevant lease.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. The gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sale proceeds and the carrying amount of the asset and is recognised in profit or loss.

22


2. SIGNIFICANT ACCOUNTING POLICIES continued

2.14 Impairment of tangible and intangible assets The carrying values of the group’s tangible and intangible assets are reviewed at each reporting date to determine whether there is any

indication that the assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the group estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Intangible assets with indefinite useful lives are tested for impairment at least annually, and whenever there is an indication that an asset may be impairment.

The recoverable amount is the higher of fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset.

If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to the recoverable amount. An impairment loss is recognised immediately in profit or loss.

Where an impairment loss subsequently reverses, the carrying amount of the asset or cash-generating unit is increased to the revised estimate of its recoverable amount, not to exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset or cash-generating unit in prior periods. A reversal of an impairment loss is recognised immediately in profit or loss.

2.15 Biological assets – owned by the group Growing crops and orchards comprise two elements:

• Bearer biological assets – Sugar cane roots, deciduous trees, macadamia trees and banana plants • Consumable biological assets – Standing sugar cane, deciduous fruit, bananas, wheat, barley, maize, canola and potatoes.

Biological assets are measured at fair value, determined on the following basis:

Growing crops and orchards Bearer biological assets are valued at escalated average current replacement costs of planting and establishment, subsequently reduced in

value over the period of their productive lives.

Consumable biological assets are measured, based at 31 March, on current estimated market prices for the following season, less the estimated costs of harvesting, transport, packing and point-of-sale costs:

• Standing cane at estimated sucrose content. • Growing fruit, grains and potatoes at estimated yields, quality standards and age.

These values are assessed to fair values on an annual basis.

Livestock Livestock are measured at their fair value less estimated point-of-sale costs, fair value being determined upon the age and size of the animals

and relevant market prices expected for the following period. Market price is determined on the basis that the animal is either to be sold to be slaughtered or realised through sale to customers at fair market value.

2.16 Biological assets – leased by the group Bearer biological assets are measured on initial recognition of the lease at fair value and credited to a long-term liability. At each period end

date, biological assets are measured at their fair values in accordance with note 2.15 above and any change in value is adjusted to the long-term liability for the period in which it arises.

Bearer biological assets leased and related to expansion area subsequent to initial recognition are measured at their fair values and any change in value is adjusted to profit or loss.

2.17 Agricultural produce Agricultural produce represents biological assets, specifically deciduous fruit, grains, potatoes and nuts harvested and awaiting sale. Agricultural

produce is measured at their fair value at date of harvesting, less estimated point-of-sale costs incurred in bringing them to their present location and condition to be sold.

2.18 Inventories Inventories are stated at the lower of cost and net realisable value. Costs comprise direct materials and, where applicable, direct labour costs

and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the weighted average method. Net realisable value represents the estimated selling price less all estimated costs of completion or selling and distribution.

Redundant and slow-moving inventories are identified and written down to their net realisable values.




2.19 Merchandise Merchandise is valued at the lower of cost or net realisable value, cost being determined on the average method basis.

2.20 Provisions Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past event, and it is probable that the

group will be required to settle the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the reporting date, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, where the effect of the time value of money is material.

2.21 Financial instruments Financial assets and financial liabilities are recognised on the group’s statement of financial position when the group becomes a party to the

contractual provisions of the instrument.

Financial assets and financial liabilities are initially measured at fair value. Financial assets and financial liabilities are offset and the net amount reported when the company has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis or to realise the asset and liability simultaneously.

Financial assets Financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’ (FVTPL), ‘held-to-

maturity’ investments, ‘available-for-sale’ (AFS) financial assets and ‘loans and receivables’.

Financial assets at FVTPL Financial assets are classified as at FVTPL when the financial asset is either held for trading or it is designated as at FVTPL.

A financial asset is classified as held for trading if:

• it has been acquired principally for the purpose of selling it in the near term; or • on initial recognition it is part of a portfolio of identified financial instruments that the group manages together and has a recent actual

pattern of short-term profit-taking; or • it is a derivative that is not designated and effective as a hedging instrument.

A financial asset other than a financial asset held for trading may be designated as at FVTPL upon initial recognition if:

• such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or • the financial asset forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is

evaluated on a fair value basis in accordance with the group’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

• it forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the entire combined contract to be designated as at FVTPL.

Financial assets at FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any dividend or interest earned on the financial asset and is included in the ‘other gains and losses’ line item.

Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturity dates that the

group has the positive intent and ability to hold to maturity. Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the effective interest method less any impairment.

Available-for-sale (AFS) financial assets AFS financial assets are non-derivatives that are either designated as AFS or are not classified as (a) loans and receivables, (b) held-to-maturity

investments or (c) financial assets at fair value through profit or loss.

The group has investments in unlisted shares that are not traded in an active market but that are also classified as AFS financial assets and stated at fair value at the end of each reporting period (because the directors consider that fair value can be reliably measured). Changes in the carrying amount of AFS monetary financial assets relating to changes in foreign currency rates (see below), interest income calculated using the effective interest method and dividends on AFS equity investments are recognised in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognised in other comprehensive income and accumulated under the heading of investments revaluation reserve. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss.

Dividends on AFS equity instruments are recognised in profit or loss when the group’s right to receive the dividends is established.

The fair value of AFS monetary financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate prevailing at the end of the reporting period. The foreign exchange gains and losses that are recognised in profit or loss are determined based on the amortised cost of the monetary asset. Other foreign exchange gains and losses are recognised in other comprehensive income.

24


2. SIGNIFICANT ACCOUNTING POLICIES continued 2.21 Financial instruments continued AFS equity investments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured and

derivatives that are linked to and must be settled by delivery of such unquoted equity investments are measured at cost less any identified impairment losses at the end of each reporting period.

Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans

and receivables (including trade and other receivables, bank balances and cash) are measured at amortised cost using the effective interest method, less any impairment.

Interest income is recognised by applying the effective interest rate, except for short-term receivables when the effect of discounting is immaterial.

Financial liabilities Financial liabilities are classified as either financial liabilities ‘at FVTPL’ or ‘other financial liabilities’.

Financial liabilities at FVTPL Financial liabilities are classified as at FVTPL when the financial liability is either held for trading or it is designated as at FVTPL.

A financial liability is classified as held for trading if:

• it has been incurred principally for the purpose of repurchasing it in the near term; or • on initial recognition it is part of a portfolio of identified financial instruments that the group manages together and has a recent actual

pattern of short-term profit-taking; or • it is a derivative that is not designated and effective as a hedging instrument.

A financial liability other than a financial liability held for trading may be designated as at FVTPL upon initial recognition if:

• such designation eliminates or significantly reduces a measurement or recognition inconsistency that would otherwise arise; or • the financial liability forms part of a group of financial assets or financial liabilities or both, which is managed and its performance is

evaluated on a fair value basis in accordance with the group’s documented risk management or investment strategy, and information about the grouping is provided internally on that basis; or

• it forms part of a contract containing one or more embedded derivatives, and IAS 39 permits the entire combined contract to be designated as at FVTPL.

Financial liabilities at FVTPL are stated at fair value, with any gains or losses arising on remeasurement recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability and is included in the ‘other gains and losses’ line item.

Other financial liabilities Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective

interest method.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.

2.22 Equity Debt and equity instruments are classified as either financial liabilities or as equity based on the substance of the contractual arrangement. An

equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Equity instruments issued by the company are recorded at the value of the proceeds received, net of direct issue costs.

2.23 Derivative financial instruments The group may enter into derivative financial instruments to manage its exposure to foreign exchange rate risks, including foreign exchange

contracts and certain commodity futures.

The use of financial derivatives is governed by the group’s policies. The group does not use derivative financial instruments for speculative purposes.

Derivative financial instruments are initially measured at fair value on the contract date, and are subsequently remeasured to fair value at each reporting date. The resultant gain or loss is recognised in profit or loss immediately unless the derivative is designated and effective as a hedging instrument, in which case the timing of the recognition in profit or loss depends on the nature of the hedge relationship.

2.24 Segmental analysis Segment reporting is presented in respect of the group’s business and geographical segments. The primary format, nature of business, is based

on the group’s management and internal reporting structure and combines businesses with common characteristics.

Segments results and assets include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Segmental capital expenditure is the total costs incurred during the period to acquire segment assets that are expected to be used for more than one year.




The group consists of the following business segments:

• Sugar cane – the growing of sugar cane • Bananas – the growing of banana trees • Deciduous – the growing of deciduous fruit trees • Grains and sheep – the growing of grains and rearing and sale of sheep • Macadamia nuts – the growing of macadamia nut trees

The secondary segment represents the geographic location in which the group operates.

2.25 Contingent liabilities A contingent liability is recognised when the group has a possible obligation (legal or constructive), as a result of a past event, and whose

existence will be confirmed only by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the group, or the amount of the obligation cannot be measured with sufficient reliability. If the likelihood of an outflow of resources is remote, the possible obligation is neither a provision nor a contingent liability and no disclosure is made.

2.26 Contingent assets A contingent asset is recognised when the group has a possible asset, as a result of a past event, and whose existence will be confirmed only

by the occurrence or non-occurrence of one or more uncertain future events not wholly within the control of the group. Such contingent assets are only recognised as assets in the financial statements where the realisation of income is virtually certain. If the inflow of economic benefits is only probable, the contingent asset is disclosed as a claim in favour of the group but not recognised in the statement of financial position.

3. APPLICATION OF NEW AND REVISED INTERNATIONAL FINANCIAL REPORTING STANDARDS 3.1 New standards and interpretations not yet adopted At the date of authorisation of these financial statements, the following new accounting standards and interpretations of accounting standards

have been issued but are not yet effective for the group.

Standard/Interpretation Description Effective date

IFRS 2 Share-based Payments: Amendments to definition of vesting condition

Annual periods beginning on or after 1 July 2014

IFRS 3 Business Combinations: Amendments to account for contingent consideration in a business combination


IFRS 8 Operating segments: Disclosure of the judgements Annual periods beginning on or after 1 July 2014

IFRS 9 Classification and measurement of financial instruments Annual periods beginning on or after 1 January 2017

Amendments to IFRS 10,IFRS 12 and IAS 27

Investment Entities Annual periods beginning on or after 1 January 2014

IAS 16 Property, Plant and Equipment: Amendments to revaluation method


IAS 1 Employee benefits: How contributions from employees linked to service should be attributed to periods of service


IAS 24 Related party disclosure: Amendments to key management personnel


IAS 32 Financial instruments: Offsetting Financial Assets and Financial Liabilities

Annual periods beginning on or after 1 January 2014

IAS 36 Impairment of Assets: Recoverable Amount Disclosure for Non-Financial Assets


IAS 38 Intangible Assets: Amendments to revaluation method Annual periods beginning on or after 1 July 2014

IAS 39 Financial instruments: Novation of Derivatives and Continuation of Hedge Accounting


IFRIC 21 Levies: Recognition of liabilities Annual periods beginning on or after 1 January 2014

26


4. CRITICAL ACCOUNTING JUDGEMENTS AND KEY SOURCES OF ESTIMATION UNCERTAINTY 4.1. Critical accounting judgements made by management In the application of the group’s accounting policies, the directors of the company are required to make judgements, estimates and

assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

4.2 Critical judgements in applying accounting policies The following are the critical judgements, apart from those involving estimations, that the directors have made in the process of applying the

group’s accounting policies and that have the most significant effect on the amounts recognised in the consolidated financial statements.

4.2.1 Impairment of assets In making its judgement, management has assessed at each reporting date whether there is any indication that its tangible and

intangible assets may be impaired. If such an indication exists, the recoverable amount of the asset is assessed in order to determine the extent of the impairment loss, if any. The recoverable amount is the higher of fair value less costs to sell and value in use.

4.2.2 Held-to-maturity financial assets The directors have reviewed the group’s held-to-maturity financial assets in the light of its capital expansion plans and liquidity

requirements and have confirmed the group’s positive intention and ability to hold those assets to maturity.

4.2.3 Control over Mthayiza Farming (Pty) Ltd Note 16.3 describes that Mthayiza Farming (Pty) Ltd is a subsidiary of the group although the group only owns 45% equity shares

of Mthayiza Farming (Pty) Ltd. Based on contractual arrangements between the group and other investors, the group has the power to control the operational and financial decisions of the company. Therefore, the directors of the group concluded that the group has control over Mthayiza Farming (Pty) Ltd and accordingly the subsidiary has been consolidated into these group financial statements.

4.2.4 Control over Kwacele Farming (Pty) Ltd Note 16.3 describes that Kwacele Farming (Pty) Ltd was a subsidiary of the group although the group only owned 49% equity shares

of Kwacele Farming (Pty) Ltd. Based on contractual arrangements between the group and other investors, the group had the power to control the operational and financial decisions of the company. Therefore, the directors of the group concluded that the group has control over Kwacele Farming (Pty) Ltd and accordingly the subsidiary has been consolidated into these group financial statements. The ownership in Kwacele Farming (Pty) Ltd was sold in 2014 and the shareholding was de-recognised on 31 March 2014, being the effective date of sale.

4.2.5 Significant influence over Lebombo Growers (Pty) Ltd Note 16.2 describes that Lebombo Growers (Pty) Ltd is an associate of the group although the group only owns a 24,9% ownership

interest in Lebombo Growers (Pty) Ltd. The group has significant influence over Lebombo Growers (Pty) Ltd by virtue of its shareholding arising from significant delivery of its agricultural produce in the form of bananas to Lebombo Growers (Pty) Ltd.

4.2.6 Significant influence over Mpambanyoni Construction Supplies (Pty) Ltd Note 16.2 describes that Mpambanyoni Construction Supplies (Pty) Ltd is an associate of the group although the group only has a

23% ownership interest in Mpambanyoni Construction Supplies (Pty) Ltd. The group has significant influence over Mpambanyoni Construction Supplies (Pty) Ltd by virtue of its contractual representation on the board and provision of capital funding to the company.

4.2.7 Discount rate used to determine the carrying amount of the group’s defined benefit obligation The group’s defined benefit surplus/obligation is discounted at a rate set by reference to market yields at the end of the reporting

period on high quality corporate bonds. Significant judgement is required when setting the criteria for bonds to be included in the population from which the yield curve is derived. The most significant criteria considered for the selection of bonds include the issue size of the corporate bonds, quality of the bonds and the identification of outliers which are excluded. The valuation was performed by the actuaries appointed by the company.

4.3 Key sources of estimation uncertainty In the process of applying the group’s accounting policies, management has made the following key assumptions concerning the future and

other key sources of estimation uncertainty at the reporting date:

4.3.1 Property, plant and equipment residual values and useful lives Assets are written down to their estimated residual values over their anticipated useful lives using the straight-line basis. Management

reviews the residual values annually considering market conditions and projected disposal values. In assessing useful lives, maintenance programmes and technological innovations are considered. The carrying value of property, plant and equipment is disclosed in note 14 to the financial statements.

4.3.2 Biological asset valuations The accounting policy is detailed above in this report and the assumptions that have been used to determine the fair value of the

consumable biological assets are detailed in note 15 to the financial statements.

4.3.3 Post-employment benefit obligations The key assumptions are provided in note 25 to the financial statements.

There are no other key assumptions concerning the future, or key sources of estimation uncertainty at the reporting date, that management has assessed as having a significant risk of causing material adjustments to the carrying amounts of the assets and liabilities within the next financial year.




GROUP COMPANY

2014 2013* 2014 2013*R’000 R’000 R’000 R’000

5.1 REVENUERevenue represents the proceeds from: Sugar cane 298 150 247 532 113 056 104 067 Bananas 66 408 53 406 66 408 53 406 Deciduous fruit 90 605 76 046 86 859 76 046Grain and sheep 24 061 23 179 24 061 23 179 Other revenue(i) 11 195 10 542 10 572 9 958

490 419 410 705 300 956 266 656

Attributable to:Continuing operations 439 019 362 348 276 895 243 477Discontinued operations 51 400 48 357 24 061 23 179

490 419 410 705 300 956 266 656

Attributable to: South Africa 359 430 317 777 300 956 266 656Other countries 130 989 92 928 – –

Total 490 419 410 705 300 956 266 656

(i) Other revenue comprises rental income from leased buildings and tourism revenue.

5.2 OTHER OPERATING INCOME 2 489 2 488 4 107 3 821

Profit/(loss) on disposal of plant and equipment 230 1 178 (273) 280 Fees on sale of sand and stone 1 675 1 194 1 675 1 194Sundry income 584 116 584 89Net management fees – subsidiaries – – 2 121 2 258

5.3 INVESTMENT INCOME 4 504 35 271 5 261 36 646

Dividends received from unlisted investments and preference shares 78 1 532 78 1 532Interest received on loans and deposits 4 426 2 781 2 737 1 325Interest earned on loans to group companies – – 2 446 2 831Interest received on the Komatipoort estate sale proceeds – 30 958 – 30 958

5.4 FINANCE COSTS 4 538 2 183 1 465 1 466

Interest on bank overdrafts and loans 1 474 996 465 466Occupational interest** 1 902 – – –Interest on loan from Two-A-Day Group (note 22.1) 1 000 1 000 1 000 1 000Interest on obligations under finance leases 153 175 – – Other interest 9 12 – –


** The company paid occupational interest of R1,9 million in the current year in respect of the acquisition of the High Noon deciduous fruit farm in the Western Cape (note 30). Interest accrued at prime less 2% per annum for the period 23 December 2013 to 31 March 2014.

28


GROUP COMPANY

2014 2013* 2014 2013*R’000 R’000 R’000 R’000

5.5 OPERATING PROFITThe following items requiring separate disclosure include: Staff costs 140 448 107 177 81 517 65 883Depreciation 24 953 18 656 12 241 9 596

Buildings 1 894 1 869 1 216 1 218Vehicles 8 698 7 156 5 065 4 551Plant and other assets 14 361 9 631 5 960 3 827

Post-employment medical aid benefit expense 814 (168) 814 (168) Retirement benefit costs 14 784 13 993 12 370 12 107

Retirement benefit contributions 8 926 8 033 6 512 6 147Defined benefit service and interest cost 5 858 5 960 5 858 5 960

Auditors’ remuneration 1 667 1 560 1 127 1 106

Audit fees – current year 1 445 1 299 907 852Audit fees – prior year 50 50 50 50Audit fees – expenses 57 59 55 52Fees for other services 115 152 115 152

Legal and consulting fees 3 068 2 020 2 783 1 803Listing fees paid to the JSE Limited 325 212 325 212Operating lease charges 5 404 5 101 2 300 2 300





Total TotalSugar Deciduous Other continuing discontinued Group cane Bananas fruit operations operations operations total

R’000 R’000 R’000 R’000 R’000 R’000 R’000

6. GROUP SEGMENTAL ANALYSISYear to 31 March 2014Revenue 270 811 66 408 90 605 11 195 439 019 51 400 490 419

Operating profit 88 728 6 871 38 617 7 124 141 340 16 063 157 403 Profit on disposal of property, plant and equipment 230 Unallocated corporate expenses (50 805)

Consolidated operating profit 106 828

Balance sheetAssetsSegmental assets 413 769 31 589 284 516 114 732 844 606 – 844 606 Investments and loans 23 812 Short-term financial assets 14 635 Unallocated corporate current assets 136 827

Consolidated total assets 1 019 880

LiabilitiesUnallocated corporate liabilities 262 092

Consolidated total liabilities 262 092

Other informationCapital expenditure on property, plant and equipment** *** 45 308 1 338 95 695 59 323 201 664 309 201 973 Depreciation 13 156 680 3 024 7 309 24 169 784 24 953

** The acquisition of the High Noon deciduous fruit farm contributed R90 million to capital expenditure for the year, which is included in the deciduous fruit segment.

*** Other operations capital includes expenditure on the group’s Mozambique macadamia development of R31 million, the completion of the Renishaw office renovations and implementation of a new financial accounting system.

30


Total TotalSugar Deciduous Other continuing discontinued Group cane Bananas fruit operations operations operations total

R’000 R’000 R’000 R’000 R’000 R’000 R’000

6. GROUP SEGMENTAL ANALYSIScontinuedYear to 31 March 2013*Revenue 222 354 53 406 76 046 10 542 362 348 48 357 410 705

Operating profit 86 600 6 312 24 727 3 518 121 157 7 698 128 855 Profit on disposal of property, plant and equipment 1 178 Unallocated corporate expenses (36 492)

Consolidated operating profit 93 541

Balance sheetAssetsSegmental assets 433 001 11 158 85 942 49 473 579 574 52 872 632 446 Investments and loans 22 358 Short-term financial assets 52 925 Unallocated corporate current assets 95 714

Consolidated total assets 803 443

LiabilitiesUnallocated corporate liabilities 218 894

Consolidated total liabilities 218 894

Other informationCapital expenditure on property, plant and equipment^ 35 172 707 7 404 33 837 77 120 1 364 78 484 Depreciation 10 332 504 2 318 4 042 17 196 1 460 18 656

Information about geographical areasRevenues and non-current assets attributable to South Africa and other countries are shown in notes 5 and 14.


^ Included in other operations is R25 million expansion capital on the group’s macadamia development.




GROUP COMPANY

2014 2013* 2014 2013*R’000 R’000 R’000 R’000

7. CAPITAL ITEMSCapital profit – sale of Overberg Agri shares and redemption of RMB Structured plus portfolio 7 430 – 7 430 –

8. TAXATION 8.1 Normal taxation Current taxation South Africa – current year 20 166 15 236 20 166 15 236 – current year (discontinued operations) 3 671 2 555 3 671 2 555

– prior year (1 135) (580) (1 133) (580) Swaziland – current year 2 329 16 – – Zambia – current year 1 382 447 – – Deferred taxation South Africa – current year 14 568 6 417 11 876 6 215 – current year (discontinued operations) 833 (392) – – – prior year 1 427 – 1 338 – South Africa – reclassified from equity to profit or loss (1 732) – (1 732) – Swaziland – current year 2 806 10 215 – – – rate change** (2 500) – – – Zambia – current year 231 (64) – – – rate change – (799) – –

42 046 33 051 34 186 23 426

Attributable to:Income taxes relating to continuing operations recognised in profit or loss 19 692 30 726 12 663 20 709 Income taxes relating to discontinued operations recognised in profit or loss 20 029 2 163 19 198 2 555 Income taxes recognised in other comprehensive income 2 325 162 2 325 162

** The tax rate in Swaziland reduced from 30% to 27,5%. % % % %

8.2 Reconciliation of rate of taxation Standard rate of taxation for the company 28,0 28,0 28,0 28,0

Increase/(decrease) in charge for the year due to: Capital gains 6,4 – 8,3 –Taxation rate differentials – non-South African subsidiaries (0,4) 0,3 – – Exempt income/permanent allowances (18,9) (1,9) (21,6) (1,4)Disallowable expenditure 2,7 0,1 2,9 1,1Rate change (1,0) (0,6) – –

Net decrease (11,2) (2,1) (10,4) (0,3)

Effective rate of taxation 16,8 25,9 17,6 27,7


32


GROUP COMPANY

2014 2013* 2014 2013*R’000 R’000 R’000 R’000

8. TAXATION continued8.3 Deferred taxation provision

Provision for taxation on temporary differences resulting from: Agricultural capital development allowances 27 560 22 765 14 849 11 991Consumable stores 3 046 7 341 2 265 1 985Biological assets 88 439 70 443 53 489 45 357 Other – provisions and prepayments (4 756) (6 169) (3 923) (5 866)Tax losses (7 331) (7 454) – –Revaluation of available-for-sale investments 241 1 501 241 1 501

107 199 88 427 66 921 54 968

The movement on the deferred taxation liability for the year was as follows: Balance at beginning of year 88 427 72 032 54 968 48 102

Accounted for in other comprehensive income: Revaluation of available-for-sale financial assets during the year 471 651 471 651Reclassification adjustments relating to available-for-sale financial assets disposed of during the year (1 732) – (1 732) –

Recognised in profit or loss – current year charge 18 438 16 176 11 876 6 215Recognised in profit or loss – related to the prior year 1 427 – 1 338 –Rate change adjustment (2 500) (799) – – Recognised on business acquisition (note 30.1) 4 899 – – – Derecognised on disposal of a subsidiary (note 16.3.5) (2 189) – – – Exchange rate translation (42) 367 – –

Balance at end of year 107 199 88 427 66 921 54 968





9. DISCONTINUED OPERATIONS 9.1 Disposal of Quarrie farm

On 25 November 2013, the company sold its grain and sheep operation, located near Napier in the Western Cape.

The disposal of the operation is consistent with the group’s long-term strategy to achieve maximum sustainable return from its assets.

The proceeds of sale substantially exceeded the carrying amount of the related net assets and accordingly no impairment losses were recognised on reclassification of this operation from held for sale (note 10).

The disposal of the operation was completed on 17 January 2014 on conclusion of transfer of the properties.

9.2 Disposal of shareholding in Kwacele Farming (Pty) Ltd On 31 March 2014, the group disposed of its 49% shareholding in Kwacele Farming (Pty) Ltd, which is a company engaged in sugar cane farming near KwaDukuza, KwaZulu-Natal.

Details of the assets and liabilities disposed of are disclosed in note 16.3.5.

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

The combined results of the discontinued operations (i.e. grain operation and sugar cane subsidiary), included in profit for the year are set out below.

The comparatives have been restated to include the operations classified as discontinued in the current year.

Revenue 51 400 48 357 24 061 23 179 Expenses (35 337) (40 659) (10 949) (14 053)

Operating profit 16 063 7 698 13 112 9 126 Net finance income* 3 720 15 3 707 –Profit on sale of land, buildings, plant and equipment 126 168 – 126 134 Loss on sale of subsidiary (note 16.3.5) (2 815) – – –

Profit before taxation 143 136 7 713 142 953 9 126 Taxation (20 029) (2 163) (19 198) (2 555)

Profit for the year from discontinued operations 123 107 5 550 123 755 6 571

The grain and sheep farm had been classified and accounted for at 31 March 2013 as a disposal group held for sale (note 10)

* The company earned occupational interest on the sale proceeds at a fixed rate of 6% per annum, for the period 1 September 2013 to the transfer date of the sale, being 17 January 2014.

10. ASSETS CLASSIFIED AS HELD FOR SALE Land, buildings, plant and equipment(i) – 15 376 – 15 376 Livestock(i) – 5 461 – 5 461

– 20 837 – 20 837

(i) As described in note 9.1, the group sold its grain and sheep operation on 25 November 2013, realising a material capital gain for the group.

34


GROUP

2014 2013Cents Cents

11. EARNINGS, HEADLINE EARNINGS PER SHARE AND DISTRIBUTIONS 11.1 Basic earnings per share

From continuing operations 633,1 711,7 From discontinued operations 975,9 49,1

Total basic earnings per share 1 609,0 760,8

R’000 R’000

The earnings and weighted average number of shares used in the calculation of basic earnings per share are as follows: Profit for the year 202 697 93 913 Adjusted for outside shareholders (1 551) 307

Total profit for the year attributable to owners of the company 201 146 94 220 Profit for the year from discontinued operations (122 002) (6 071)

Earnings used in the calculation of basic earnings per share from continuing operations 79 144 88 149

Numberof shares

Numberof shares

Weighted average number of shares for the purposes of basic earnings per share 12 501 154 12 385 000

The weighted average number of shares for the purposes of earnings per share are as follows: Number of shares in issue at the beginning of the year 12 385 000 12 385 000Shares issued in scrip dividend (161 817 shares) (note 12) on 12 July 2013 weighted for the number of days the shares were in issue 116 154 –

Number of shares for the purposes of earnings per share 12 501 154 12 385 000

Cents Cents

11.2 Diluted earnings per share From continuing operations 621,9 701,0 From discontinued operations 958,5 48,3

Total basic earnings per share 1 580,4 749,3

R’000 R’000

The earnings and weighted average number of shares used in the calculation of diluted earnings per share are as follows: Profit for the year 202 697 93 913Adjusted for outside shareholders (1 551) 307

Total profit for the year attributable to owners of the company 201 146 94 220 Profit for the year from discontinued operations (122 002) (6 071)

Earnings used in the calculation of diluted earnings per share from continuing operations 79 144 88 149

Numberof shares

Numberof shares

Weighted average number of shares for the purposes of diluted earnings per share 12 727 154 12 574 000

The weighted average number of shares for the purposes of diluted earnings per share reconciles to the weighted number of shares used in the calculation of basic earnings per share as follows: Weighted shares used in the calculation of basic earnings per share 12 501 154 12 385 000Shares deemed to be issued for no consideration in respect of employee share options (note 26) 226 000 189 000

Weighted average shares used in the calculation of diluted earnings per share 12 727 154 12 574 000




GROUP

2014 2013R’000 R’000

11. EARNINGS, HEADLINE EARNINGS PER SHARE AND DISTRIBUTIONS continued11.3 Headline earnings per share

Reconciliation of headline earnings:Profit for the year attributable to shareholders of Crookes Brothers Limited 201 146 94 220 Adjusted for: Profit on disposal of shares (7 430) –Tax effect of the disposal of shares (19) –Loss on disposal of subsidiary 2 815 –Capital profit on disposal of property, plant and equipment (126 168) –Profit on disposal of plant and equipment (230) (1 178) Tax effect of the adjustments 14 489 285

Headline earnings 84 603 93 327

Headline earnings per share (cents) 676,8 753,5 Headline earnings per share (diluted) (cents) 664,7 742,2

Headline earnings of R84,603 million (2013: R93,327 million), divided by the weighted average number of shares in issue during the year.

11.4 Diluted headline earnings per share Headline earnings of R84,603 million (2013: R93,327 million), divided by the weighted average number of shares in issue during the year after adjusting for the potentially dilutive shares.

12. DISTRIBUTIONSCash distributions Distribution number 194 of 135 cents per share (final 2012) – paid 16 July 2012 – 16 720 Distribution number 195 of 80 cents per share (interim 2013) – paid 24 December 2012 – 9 908 Distribution number 196 of 160 cents per share (final 2013) – paid 15 July 2013^ 10 916 –Distribution number 197 of 80 cents per share (interim 2014) – 13 January 2014 10 036 –

20 952 26 628

Scrip dividend Distribution number 196 of 160 cents per share (final 2013) – paid 15 July 2013^ 8 901 –

Total dividends 29 853 26 628

^ In respect of the final dividend for 2013, shareholders were given an option to elect to receive capitalisation shares in lieu of the cash dividend.

Where shareholders elected to receive the capitalisation shares, the number of shares to which a shareholder would be entitled was 2,90909 new shares for every 100 shares held. The ratio was derived by dividing 160 cents per share by 5 500 cents, being the prevailing price per share on Friday, 24 May 2013 at the time the board made the decision to set the price.

New shares of 161 817 were issued to shareholders holding 5 562 511 shares who elected the capitalisation share alternative. This represented an equivalent cash dividend of R8,9 million.

For the year under review, the directors declared a final dividend distribution of 120 cents per share, which will be paid to shareholders on 14 July 2014. The distribution will be regarded as a distribution of reserves and shareholders will be liable for any dividend withholding tax consequences.

The total distribution for the current year will be 200 cents per share (2013: 240 cents per share).

36


13. IMPACT OF CHANGES IN ACCOUNTING POLICIESChanges in the group’s accounting policies during the year are described in note 1.3. The changes in the accounting policies affect only the group’s results from continuing operations. To the extent that those changes had an impact on the results reported for 2014 and 2013, they have had an impact on the amounts reported for earnings per share.

The following table summarises the effect on both basic and diluted earnings per share.

Increase/(decrease) in profit for the year attributable

to owners of the company Increase/(decrease) in

basic earnings per shareIncrease/(decrease) in

diluted earnings per share

2014 2013 2014 2013 2014 2013 Changes related to: R’000 R’000 Cents Cents Cents Cents

Application of IFRS 10 – – – – – – Application of IFRS 11 – – – – – – Application of IAS 19 (2011 revised) (5 977) 448 (47,81) 3,62 (46,96) 3,52

(5 977) 448 (47,81) 3,62 (46,96) 3,52

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

14. PROPERTY, PLANT AND EQUIPMENTAt cost Freehold land 168 759 82 387 64 970 68 426 Leasehold land/land rights 39 285 38 206 – – Buildings 54 382 51 376 34 286 32 023 Vehicles, plant and other assets 302 821 203 531 142 569 97 976 Vehicles, plant and other assets under finance leases 3 398 7 566 – 4 168

568 645 383 066 241 825 202 593

Accumulated depreciation and impairment Buildings 18 956 17 539 13 327 12 111 Vehicles, plant and other assets 87 913 76 164 48 237 40 750 Vehicles, plant and other assets under finance leases 815 3 749 – 3 341

107 684 97 452 61 564 56 202

Net book value 460 961 285 614 180 261 146 391

Reconciliation of net book value of property, plant and equipment: Net book value at beginning of year 285 614 236 952 146 391 148 490 Capital replacement, improvements and additions from acquisitions(i) 201 973 78 484 46 993 23 264 Depreciation (24 953) (18 656) (12 241) (9 596) Disposals (1 005) (790) (882) (391) Exchange rate translation 2 344 5 000 – – Derecognised on disposal of subsidiary (3 012) – – – Reclassified as held for sale – (15 376) – (15 376)

Net book value at end of year 460 961 285 614 180 261 146 391

Located in South Africa 288 561 163 064 180 261 146 391 Located in other countries 172 400 122 550 – –

460 961 285 614 180 261 146 391

The group’s properties are wide-ranging, comprising largely the land on which the group’s crop-growing activities are situated. As the number of properties is extensive, a list is not published with these statements, but registers of land and buildings are available for inspection at the registered offices of the company or its subsidiaries.

Certain assets are encumbered in respect of instalment sale agreements, details of which are shown in note 22.1. The company’s Vyeboom deciduous fruit farm at Grabouw in the Western Cape remains security for an unutilised loan facility (note 22.1).

(i) The group continued with its upgrading of infrastructure on existing farms, primarily irrigation upgrades to yield improved results. The expansion of the group’s macadamia development in Gurue, Mozambique gained momentum, a further R31 million being spent on capital assets and infrastructure developments on the farm. The group spent R18 million in the current year on the construction of a dam in Swaziland. During the year, the group acquired the High Noon deciduous fruit farm in the Western Cape. Land, buildings, plant and equipment of R90 million were acquired (note 30).




GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

15. BIOLOGICAL ASSETS 15.1 Growing crops and orchards

At fair value less estimated point-of-sale costs Sugar cane 221 110 224 681 108 106 91 572Bananas 27 379 22 958 27 379 22 958Deciduous fruit 119 952 75 913 92 977 75 913Maize and Potatoes 3 395 – – – Macadamia nuts 10 855 1 472 – –

Carrying amount at end of year 382 691 325 024 228 462 190 443

Non-current assets – bearer biological assets 192 883 145 518 136 961 108 978Current assets – crops 189 808 179 506 91 501 81 465

382 691 325 024 228 462 190 443

Reconciliation of carrying amounts of bearer, growing crops and orchards: Carrying value at beginning of year 325 024 273 224 190 443 170 621Purchases of biological assets in acquisitions (note 30) 17 498 – – –Gains arising from changes attributable to physical and price changes 256 948 202 497 125 299 95 900Decreases due to harvest and sales (189 092) (153 030) (87 280) (76 078)Derecognised on disposal of subsidiary (27 561) – – –Exchange rate translation (126) 2 333 – –

Carrying value at end of year 382 691 325 024 228 462 190 443

15.2 Livestock Reconciliation of carrying value of livestock: Carrying value at beginning of year 970 7 156 970 7 156 Increases due to purchases – 117 – 117 Fair value changes attributable to physical changes and price changes (16) 1 898 (16) 1 898

Decreases due to sales – (2 740) – (2 740)Reclassified as held for sale – (5 461) – (5 461)

Carrying value at end of year 954 970 954 970

The following key assumptions have been used in determining the fair value of biological assets:

Sugar caneStanding sugar caneExpected area to harvest– South Africa (ha) 3 729 4 511 3 012 2 680 – Swaziland (ha) 2 318 2 375 – – – Zambia (ha) 438 415 – – Estimated yields– South Africa (tons/ha) 92,5 93,7 101,2 102,8– Swaziland (tons/ha) 111,4 115,3 – – – Zambia (tons/ha) 130,0 127,7 – – Average maturity of cane at 31 March– South Africa (%) 63 63 63 64 – Swaziland (%) 64 60 – – – Zambia (%) 64 64 – – Estimated RV price – South Africa (Rands) 3 359 3 152 3 359 3 152Estimated sucrose price – Swaziland (Rands) 2 971 3 011 – –Estimated ERC price – Zambia (Rands) 3 665 3 135 – –

38


GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

15. BIOLOGICAL ASSETS continuedSugar cane continuedCane rootsEstimated productive ratoons (years) 6 to 8 6 to 8 6 to 8 6 to 8Average indexed current replacement cost of establishment – reduced according to age (R/ha) 8 633 7 286 10 236 7 806

BananasCropExpected area to harvest (ha) 318 286 318 286Estimated yields (tons/ha) 55,0 55,0 55,0 55,0Average maturity of crop at 31 March (%) 50,0 50,0 50,0 50,0 Estimated price per carton (Rands) 80,39 79,32 80,39 79,32Banana plantsEstimated productive life (years) 9 9 9 9Average indexed current replacement cost of establishment – reduced according to age (R/ha) 44 969 42 680 44 969 42 680

Deciduous fruitCropExpected area to harvest – after 31 March (ha) 211 123 123 123Estimated yields (tons/ha) 64,0 62,9 66,0 62,9Average maturity of crop at 31 March (%) 87 87 87 87 Estimated net price per kg – apples (Rands) 3,14 2,98 3,31 2,98Deciduous treesEstimated productive life (years) 30 30 30 30Average indexed current replacement cost of establishment – reduced according to age (R/ha) 159 810 172 548 195 737 172 548

Macadamia nutsCropExpected area to harvest – after 31 March (ha) – – – – Macadamia treesEstimated productive life (years) 30 30 – – Average indexed current replacement cost of establishment – reduced according to age (R/ha) 69 623 36 796 – –

PotatoesCropExpected area to harvest – after 31 March (ha) 19 – – – Estimated yields (tons/ha) 32 – – – Average maturity of crop at 31 March (%) 56 – – – Estimated net price per pocket (Rands) 56,45 – – –

MaizeCropExpected area to harvest – after 31 March (ha) 140 – – – Estimated yields (tons/ha) 8,0 – – – Average maturity of crop at 31 March (%) 67 – – – Estimated net price per ton (Rands) 2 366 – – –




2014Number ofshares held

2013Number of shares held

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

16. INVESTMENTS16.1 Unlisted investments

Nkwaleni Investments 71 71 100 100 100 100 Overberg Agri – 59 904 – 4 468 – 4 468 Two-A-Day Group 1 893 481 820 000 65 65 65 65 BKB 44 600 44 600 268 312 268 312 Elgin Fruitgrowers 1 660 081 1 660 081 166 166 166 166 Villiersdorp Co-operative 65 996 65 996 134 134 134 134 Apsap Fruit 58 069 58 069 116 116 116 116 Other farming co-operatives and agribusinesses 130 156 130 155

979 5 517 979 5 516

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

16.2 Investment in associatesDetails of each of the group’s material associates at the end of the reporting period are as follows:

16.2.1 Lebombo Growers (Pty) Ltd*Unlisted shares and loans 16 377 14 127 16 377 14 127 Share of retained earnings 1 036 574 – –

Carrying value of associate company 17 413 14 701 16 377 14 127

Principal activity:Banana marketing and distribution

Percentage holding: 24,9% (2013: 24,9%)

Aggregate assets and liabilities of associate company as per the most recent audited financial statements (31 March 2013):

Property, plant, equipment and investments 46 759 43 562 – –Current assets 12 023 8 342 – –

Total assets 58 782 51 904 – –Long-term liabilities including shareholders’ loans (26 682) (26 694) – –Current liabilities (13 682) (8 647) – –

Net assets 18 418 16 563 – –

* Incorporated in South Africa.

40


GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

16. INVESTMENTS continued 16.2 Investment in associates continued

16.2.2 Mpambanyoni Sand (Pty) Ltd*Unlisted shares and loans 49 49 49 49 Share of retained deficit (22) (22) – –

Carrying value of associate company 27 27 49 49

Principal activity:Dormant

Percentage holding: 37,0% (2013: 37,0%)

Net liabilities per the most recent audited financial statements (31 March 2014): (59) (59) – –

16.2.3 Mpambanyoni Construction Supplies (Pty) Ltd*Unlisted shares and loans 760 760 760 760 Share of retained profit/(deficit) 481 (178) – –

Carrying value of associate company 1 241 582 760 760

Principal activity:Manufacture of blocks, bricks, lintels, pavers and associated cement products

Percentage holding: 23% (2013: 23%)

Aggregate assets and liabilities as per the most recent audited financial statements (28 February 2014):

Property, plant and equipment 6 395 3 681 – –Current assets 3 997 2 632 – –

Total assets 10 392 6 313 – –Long-term liabilities including shareholders’ loans (5 595) (5 355) – –Current liabilities (2 507) (1 382) – –

Net assets/(liabilities) 2 290 (424) – –

Total investment in associate companies 18 681 15 310 17 186 14 936

* Incorporated in South Africa.

All of the associates are accounted for using the equity method in these consolidated financial statements.




COMPANY

2014 2013

R’000 R’000

16. INVESTMENTS continued16.3 Investments in subsidiaries

The principal subsidiaries of Crookes Brothers Limited and their respective loan balances are listed in note 16.3.2 and 16.3.3.

16.3.1 Profits/(losses) of subsidiariesAggregate profits 53 631 34 200 Aggregate (losses) (2 626) (2 968)

16.3.2 Shares and amounts owing by subsidiaries

%holding

2014

%holding

2013Issuedcapital

Country ofincorporation

Principalactivity

Murrimo Macadamia Lda(ii) 99 99 MZN55 000 Mozambique Farming 65 707 13 344

Murrimo Farming Lda(ii) 99 99 MZN20 000 Mozambique Agricultural holding company 19 451 19 462

CBL Agri Services (Pty) Ltd(ii) 100 100 R100 South Africa Agricultural services 131 167 1 962

CBL Agri International (Pty) Ltd(ii) 100 100 R100 South Africa Agricultural holding company 36 47 020

Crookes Plantations Limited(ii) 100 100 E500 000 Swaziland Farming 830 830

Bar J Limited (a subsidiary of Crookes Plantations Limited)

100 100 R200 Swaziland Farming– –

Mthayiza Farming (Pty) Ltd(i) (iii) 45 45 R100 South Africa Farming 442 1 463

Kwacele Farming (Pty) Ltd(i) (note 16.3.5)

0 49 R100 South Africa Farming– 2 978

Renishaw Property Development (Pty) Ltd(ii)

100 100 R100 South Africa Property development 7 155 5 951

CBL Agri Zambia Limited (a wholly owned subsidiaryof CBL Agri International (Pty) Ltd)(i)

100 100 ZMW5 000 Zambia Farming

28 158 –

252 946 93 010

16.3.3 Amounts owing to subsidiariesCrookes Plantations Limited(ii) 69 720 54 684

69 720 54 684

(i) The loans are unsecured, interest-bearing and have no fixed terms of repayment. Variable interest is charged at rates between South African prime less 2% per annum and prime plus 2% per annum. These loans will not be required to be settled in the next financial year.

(ii) The loans are unsecured, interest-free and have no fixed terms of repayment. These loans will not be required to be settled in the next financial year.

(iii) The group owns 45% equity shares of Mthayiza Farming (Pty) Ltd. Based on contractual arrangements between the group and other investors the group has the power to control the operational and financial decisions of the company. Therefore, the directors concluded that the group has control over Mthayiza Farming (Pty) Ltd and accordingly the subsidiary has been consolidated into these group financial statements.

42


COMPANY

2014 2013R’000 R’000

16. INVESTMENTS continued16.3 Investments in subsidiaries continued

16.3.4 Shares and loans Summarised financial information of the group’s subsidiaries that have a material non-controlling interest is set out below:

Mthayiza Farming (Pty) LtdCurrent assets 24 740 15 984 Non-current assets 15 626 12 946 Current liabilities (10 194) (7 378) Non-current liabilities (26 175) (18 375) Equity attributable to owners of the company 1 798 1 429 Non-controlling interests 2 199 1 748

Revenue 26 955 26 143 Expenses (26 135) (25 709)

Profit for the year 820 434

Profit attributable to owners of the company 369 195 Profit attributable to non-controlling interests 451 239

820 434

16.3.5 Change in the group’s ownership interest in a subsidiaryOn 31 March 2014, the group disposed of its 49% interest in Kwacele Farming (Pty) Ltd which it owned since the inception of the company in 2009.

The shares of R49 were sold at book value and no further disposal proceeds were received. The net amount of R2,8 million, being the group’s interest in the net assets of Kwacele Farming (Pty) Ltd and the consideration received, has been charged to profit or loss.

The results of the subsidiary have been included in profit for the year from discontinued operations (note 9) and the comparative profit has been restated.

An analysis of the assets and liabilities over which control was lost: Non-current assetsProperty, plant and equipment 3 012 Biological assets – bearer 11 468 Current assetsInventories 47Biological assets – crops 16 093 Trade receivables 1 117 Cash and cash equivalents 6 553 Non-current liabilitiesDeferred tax liabilities (2 189) Long-term liabilities (22 138) Current payablesPayables (1 186) Short-term borrowings – interest-bearing (7 032)

Net assets disposed of 5 745

Consideration received in cash and cash equivalents –Net assets disposed of (5 745) Non-controlling interests (note 21.2) 2 930

Loss on disposal (2 815)

The loss on disposal is included in the profit for the year from discontinued operations (note 9.2).

Net cash outflow on disposal of subsidiaryConsideration received in cash and cash equivalents –Less: Cash and cash equivalent balances disposed of 6 553

Total cash outflow (6 553)




GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

17. UNSECURED LOANS Loan – Le Pront Catering CC Balance at beginning of year 663 618 663 618 Interest accrued 1 45 1 45 Repaid (550) – (550) –

Balance at end of year 114 663 114 663

The working capital loan has been provided to the owners of the Le Rendez-Vous restaurant who operate from the company’s Crocworld facility.

The unsecured loan accrues interest at a fixed rate of 7% and is repayable by June 2017.

Loan – Kwacele Development Company (Pty) Ltd Balance at beginning of year 459 320 459 320 Advanced during the year – 139 – 139


The loan provided to Kwacele Development Company (Pty) Ltd enabled that company to acquire an empowerment shareholding in Mpambanyoni Construction Supplies (Pty) Ltd, the group’s brick- and block-making associate company (note 16.2.3).

The unsecured loan is interest-free and will be repaid by March 2017.

Loan – Mphenjwa Training and Development CC Balance at beginning of year 81 – 81 –Advanced during the year – 81 – 81


The loan provided to Mphenjwa Training and Development CC enabled that company to acquire an empowerment shareholding in Mpambanyoni Construction Supplies (Pty) Ltd, the group’s brick- and block-making associate company (note 16.2.3).

The unsecured loan is interest-free and will be repaid by March 2017.

Loan – Libuyile Community Trust Balance at beginning of year 328 500 – – Repaid during the year (328) (172) – –

Balance at end of year – 328 – –

The loan was provided by Mthayiza Farming (Pty) Ltd to the Libuyile Community Trust in 2011 to assist the trust to acquire farming assets for its community-based projects. The loan was repaid in full during the year.

Loan – Kwacele Farming (Pty) Ltd Advanced during the year 3 498 – 3 498 –

Balance at end of year 3 498 – 3 498 –

The group sold its equity interest in its subsidiary, Kwacele Farming (Pty) Ltd, and the working capital loan that was provided to the former group company remained unpaid at the end of the year. The unsecured loan accrued interest at prime plus 2%.

The loan was repaid during April 2014.

The fair value adjustments on these unsecured loans are considered immaterial.

Unsecured loans included in the financial statements as: Unsecured loans – long-term 654 1 203 654 1 203 Unsecured loans – short-term 3 498 328 3 498 –

4 152 1 531 4 152 1 203

44


GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

18. INVENTORIES Consumable stores 14 572 12 072 8 822 7 189Agricultural produce^ 37 978 17 147 21 063 17 147Merchandise 258 225 258 225

52 808 29 444 30 143 24 561

The value of inventories included above at fair value 37 978 17 147 21 063 17 147

^ The acquisition of the High Noon deciduous fruit farm accounted for R17 million of the increase in agricultural produce.

19. TRADE AND OTHER RECEIVABLES Receivables – trade 53 467 25 418 29 455 18 686Less: Allowances for doubtful debts (346) (202) (346) (202)

Net trade receivables 53 121 25 216 29 109 18 484Prepayments 2 050 3 943 1 308 1 143

Total trade and other receivables 55 171 29 159 30 417 19 627

Reconciliation of allowances for doubtful debts:Opening balance 202 210 202 201Impairment losses recognised on receivables 153 1 153 1Amounts written off during the year (9) (9) (9) –

Closing balance 346 202 346 202

In determining the recoverability of trade receivables, the group considers any change in the credit quality from the date credit was initially granted to the end of the reporting period.

The concentration of credit risk is limited due to the disbursed customer base and the varied range of products.

The company is currently engaged in legal proceedings for the recovery of a trade receivable to the value of R0,2 million. This has been included in the allowance for doubtful debts at the end of both reporting periods.

The directors consider that the carrying amounts of trade and other receivables approximate their fair value.

The directors believe there is no further credit risk provision required in excess of the allowance for doubtful debts.

Disclosures concerning the management of credit risk have been provided in note 27.3.

20. OTHER FINANCIAL ASSETS Available-for-sale investments carried at fair valueStructured Plus Portfolio(i) – 22 232 – 22 232Investments carried at amortised cost Call deposits(ii)(iii) 14 636 30 694 – 22 608

14 636 52 926 – 44 840

(i) The company held an investment in the RMB Structured Plus Portfolio of R22,2 million in the prior year. The investment grew at an annualised return of 8,9% to November 2013. The investment was redeemed in November 2013, returning R23,6 million cash to provide funding for the group’s expansion activities.

(ii) The company’s R22,6 million invested in a seven-day fixed deposit with Investec Bank Limited matured on 4 April 2013. The group invested in a three-month fixed deposit with First National Bank Limited, Zambia, for the equivalent of R14,6 million. The investment yields a return of 9,75% per annum and has a maturity date of 22 April 2014.

(iii) The group’s investment in a six-month fixed deposit with First National Bank Limited, Zambia of R8,1 million matured on 12 April 2013.

Refer to note 28 for the fair value measurement hierarchy.




GROUP AND COMPANY

2014 2013R’000 R’000

21. CAPITAL, RESERVES AND SHAREHOLDING INTERESTS21.1 Share capital, share premium and reserves

Authorised 16 000 000 (2013:16 000 000) ordinary shares of 25 cents (2013: 25 cents) each 4 000 4 000

Issued 12 546 817 (2013:12 385 000) ordinary shares of 25 cents (2013: 25 cents) each 3 137 3 096 Share premium account 8 972 112

12 109 3 208

The share capital movement for the year was as follows: Balance at the beginning of the year 3 208 3 208 Capitalisation shares issued* 8 901 –

Balance at the end of the year 12 109 3 208

GROUP AND COMPANY

2014 2013Shares Shares

The shares in issue movement for the year was as follows:Balance at the beginning of the year 12 385 000 12 385 000 Capitalisation shares issued* 161 819 –

Balance at the end of the year 12 546 819 12 385 000

* Refer to note 12 for details on the capitalisation share issue.

Under control of directors: – for the purposes of the employee share option scheme 289 000 shares (2013: 326 000 shares) – in terms of a shareholders’ resolution 941 011 shares (2013: 928 875 shares)

46


GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

21. CAPITAL, RESERVES AND SHAREHOLDING INTERESTS continued21.1 Share capital, share premium and reserves continued

Investment revaluation reserve Balance at beginning of year 6 436 3 615 6 436 3 615Net gain arising on revaluation of available-for-sale financial assets 2 052 2 821 2 052 2 821Cumulative gain reclassified to profit or loss on sale of available-for-sale financial assets^ (7 430) – (7 430) –


The investment revaluation reserve represents the cumulative gains and losses arising on the revaluation of available-for-sale financial assets that have been recognised in other comprehensive income, net of amounts reclassified to profit or loss when those assets have been disposed of during the year.

^ The company realised a material gain on the sale of its shares in Overberg Agri and the liquidation of its investment in the RMB Structured Plus Portfolio.

Share-based payment reserve Balance at beginning of year 720 551 720 551Share-based payment expense 72 169 72 169


Foreign currency translation reserve Balance at beginning of year 5 103 (3 673) – –Exchange differences on translation of subsidiaries (257) 8 776 – –

Balance at end of year 4 846 5 103 – –

Exchange differences relating to the translation of the results and net assets of the group’s foreign subsidiaries from their functional currency to the group’s presentation currency are recognised directly in other comprehensive income and accumulated in the foreign currency translation reserve.

21.2 Non-controlling interests Balance at beginning of year 3 548 3 855Share of profit/(loss) for the year 1 551 (307)Change in non-controlling interests on disposal of subsidiary (note 16.3.5) (2 930) –





GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

22. BORROWINGS 22.1 Short-term borrowings: interest-bearing

Call loans(i) 10 375 10 402 10 375 10 402 Current portion of long-term borrowings (note 22.2) 6 785 5 509 – 1 075 Amounts due to bankers(ii) 17 018 – 17 018 –

34 178 15 911 27 393 11 477

(i) Call loans represent a loan of R10 million from the Two-A-Day Group, bearing fixed interest at 10% per annum. The loan has no fixed terms of repayment and is linked to the Two-A-Day Group’s use of the Vyeboom pack-house facility in the Western Cape. Call loans of R0,4 million (2013: R0,4 million) bear interest at prime less 3,5% per annum with no fixed terms of repayment.

(ii) The amounts due to bankers have no fixed terms of repayment and bear interest at variable market-related interest rates.

The company has unsecured bank overdraft facilities of R70 million (2013: R60 million). These facilities are subject to annual review and bear interest as follows: R30 million – prime less 2% R15 million – prime less 0,50%R25 million – prime

The company’s Ouwerf and Vyeboom deciduous fruit properties in the Western Cape with a book value of R42 million (2013: R42 million) are encumbered as security for additional funding of R60 million. (This amount does not form part of the total R70 million unsecured facilities).

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

22.2 Long-term borrowings Finance leases(i) Minimum lease payments due: Not later than one year – 1 159 – 1 159 Later than one year and not later than five years – – – –

– 1 159 – 1 159Less: Future finance charges – (84) – (84)

– 1 075 – 1 075

Payable: Not later than one year – 1 075 – 1 075Later than one year and not later than five years – – – –

– 1 075 – 1 075

Instalment sale agreements(ii)

Capital repayments due: Not later than one year 659 652 – – Later than one year and not later than five years 1 045 1 551 – –

1 704 2 203 – –

Term loan arrangements(iii)

Capital repayments due: Not later than one year 6 126 3 782 – – Later than one year and not later than five years 18 910 11 962 – –

25 036 15 744 – –

Unsecured liabilityKomatipoort Estate(iv) 37 426 28 454 37 426 28 454 Mthayiza Estate(v) 4 337 3 485 – – KwaCele Estate(vi) – 19 696 – –

41 763 51 635 37 426 28 454

48


GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

22. BORROWINGS continued22.2 Long-term borrowings continued

Included in the consolidated financial statements as: Long-term borrowings: interest-bearing 19 955 13 513 – –Long-term liability: interest-free 41 763 51 635 37 426 28 454Short-term borrowings (note 22.1) 6 785 5 509 – 1 075

68 503 70 657 37 426 29 529

Summary of borrowing arrangements (i) Finance leases relating to sugar cane haulage vehicles have been classified in terms of interpretation IFRIC 4 (determining whether an

arrangement contains a lease). The finance leases had lease terms of five years and were secured over vehicles, plant and other assets. The liability was settled during the year.

(ii) Five-year instalment sale agreements with Standard Bank, secured by sugar cane haulage trucks and trailers with a net book value of R2,6 million (2013: R3 million). The agreements bear interest at prime less 0,75%, repayment terms of R0,1 million per month, payable for seven months per year in the months of June to December. The financing is in relation to a group company, Mthayiza Farming (Pty) Ltd.

(iii) Mthayiza Farming (Pty) Ltd secured an additional loan facility of R12 500 000 on 26 March 2014 from the Land Bank, administered by Akwandze Agricultural Finance. The facility is repayable over six years, has fixed interest of 4% per annum and repayments of R0,3 million per month. The nine repayment months per year are structured into cane season revenue generating months from May to January inclusive. The terms of the existing loan facility of R20 million, secured in 2013 from the Land Bank, remain unchanged and are summarised as follows:

– repayable over six years at a fixed interest rate of 4% per annum – repayable in nine monthly instalments per year of R0,4 million – payments structured into cane season revenue generating months from May to January inclusive

Security for both loans is provided by a cession over cane proceeds with additional surety provided by Crookes Brothers Limited.

(iv) The liability is interest-free, has no fixed terms of repayment and relates to the valuation attributable to bearer biological assets attached to leased land in Komatipoort. The liability will be settled by handover of the bearer biological assets after 10 years, being the duration of the lease agreement. The lease ends in 2021.

(v) The liability is interest-free, has no fixed terms of repayment and relates to the valuation attributable to bearer biological assets attached to leased land. The liability will be settled by handover of the bearer biological assets on termination of the lease agreement with the Libuyile Community Trust. The lease term ends September 2023.

(vi) As a result of the group’s sale of its equity interest in Kwacele Farming (Pty) Ltd, the liability no longer forms part of group liabilities.

GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

22.3 Borrowing powers Total permitted level of borrowings is limited in terms of the memorandum of incorporation to the equity of the company 526 193 391 964 526 193 391 964 Actual borrowings 54 133 29 424 27 393 11 477




GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

23. TRADE AND OTHER PAYABLES Trade payables and accruals 23 473 24 324 9 525 12 680 Payroll accruals 3 044 2 255 2 500 1 692

26 517 26 579 12 025 14 372

Trade payables and accruals principally comprise outstanding trade payables in respect of goods or services acquired.

No interest is charged on the majority of trade payables for the first 45 days from the date of invoice. Suppliers charging interest on overdue accounts predominantly charge at 2% above the prime lending rate.

The group has financial risk management policies in place to ensure that all payables are paid within the pre-approved credit terms.

The directors consider that the carrying amounts of trade and other payables approximate their fair value.

24. PROVISIONS Balance at beginning of year 11 918 13 721 8 036 9 621

Leave pay 4 177 3 859 2 972 2 701 Bonuses 6 131 8 456 5 064 6 920 Severance allowances 1 610 1 406 – –

Net movements during the year 1 421 (1 803) 1 108 (1 585)

Leave pay 737 318 530 271 Bonuses 696 (2 325) 578 (1 856) Severance allowances (12) 204 – –


Leave pay 4 914 4 177 3 502 2 972 Bonuses 6 827 6 131 5 642 5 064 Severance allowances 1 598 1 610 – –

The provision for leave pay represents annual leave entitlements accrued by employees.

25. NET POST-EMPLOYMENT OBLIGATIONSPost-employment medical aid benefits 9 618 10 514 9 618 10 514 Retirement benefits (5 990) – (5 990) –

3 628 10 514 3 628 10 514

Included in the consolidated statement of financial position as: Retirement benefit surplus (5 990) – (5 990) –Post-employment benefit obligations 9 618 10 514 9 618 10 514

50


25. NET POST-EMPLOYMENT OBLIGATIONS continued25.1 Post-employment medical aid benefits

The obligation of the group to pay medical aid benefits after retirement is no longer part of the conditions of employment for employees engaged after August 1996.

However, ten pensioners (2013: 10) and fifteen current employees (2013: 15) remain entitled to this benefit.

The continued entitlement to this benefit for current employees is dependent upon the employee remaining in service until retirement age, being sixty-three years of age.

The company continues to pay medical aid benefits in the form of an allowance for qualifying employees until the age of 65, thereafter it purchases individual CPI-linked annuities from approved insurers to extinguish the company’s on-going liability. During the current year the group did not settle any post-employment obligations in respect of pensioners. During the prior year, the company settled its obligations in respect of certain pensioners at a cost of R1,1 million.

Valuation data of qualifying employees

Status Members

Subsidy weighted

average age Average

past service

Proportionmarried

(%)

Average monthly

subsidy (R)

Working employees 15 56,2 26,5 93 2 932Pensioners and widower members 10 79,3 – 20 2 371

The value of the liability is in accordance with the company’s subsidy policy for each given member and is based on:

– The benchmark subsidy amount– The member’s date of joining the company– The member’s marital status

The fixed Rand subsidy benchmark amounts are reviewed and increased on an annual basis, each individual member receiving a percentage of the benchmark based on the member’s date of joining the company.

The benchmark subsidy is per the below:

2014 Subsidy (Rands)

2013 Subsidy (Rands)

Member typeSingle member 2 185 2 052Married member 4 050 3 803

The benchmark subsidy members are eligible to receive is based on their date of joining the company.%

of benchmark

Members employed before 1 January 1991 100Members employed between 1 January 1991 and 31 July 1996 70

The membership data used for the valuation was provided by the company to the actuaries and verified by the relevant medical scheme administrator.

The actuarial present value of the unfunded post-employment medical aid obligation as at 31 March 2014 and 2013 has been determined by Lara Wayburne (MSc FASSA FFA) (Primary regulator: Actuarial Society of South Africa), in her capacity as an actuary of NMG Consultants and Actuaries (Pty) Ltd.

Valuation assumptions and methodologyThe post-employment health care liabilities have been valued using the projected unit credit discounted cashflow method.

The key assumptions used are shown below:

31 March 2014

(%)

31 March 2013

(%)

Economic assumptionsConsumer Price Inflation (CPI) 7,27 6,79Health care cost inflation 8,77 8,29Discount rate 9,83 8,42Real discount rate 0,97 0,12




GROUP AND COMPANY

Restated2014 2013*

R’000 R’000

25. NET POST-EMPLOYMENT OBLIGATIONS continued25.1 Post-employment medical aid benefits continued

Amounts recognised in comprehensive income in respect of the post-employment medical aid benefits are as follows:

Service cost 251 245 Interest cost 872 837 Benefit payments (309) (296) Settlement gain – 175 Purchase of annuities – (1 129)

Components of post-retirement medical aid benefits recognised in profit or loss 814 (168)

Remeasurement gain/(loss) of post-retirement medical aid benefits recognised in other comprehensive income

1 710 (1 082)

Tax effect of remeasurement (479) 303

Components of post-retirement medical aid benefits recognised in other comprehensive income, net of tax 1 231 (779)

The amount included in the consolidated statement of financial position arising from the company’s obligations in respect of post-retirement medical is as follows:

Net liability at beginning of year 10 514 9 600 Service cost 251 245 Interest cost 872 837 Benefit payments (309) (296) Settlement gain – 175 Purchase of annuities – (1 129) Remeasurement (gain)/loss (1 710) 1 082

Net liability at end of year 9 618 10 514

Sensitivity of health care cost trend rates1% increase in trend rate– effect on the aggregate of the service and interest costs 176 188– effect on the obligation 1 433 1 7241% decrease in trend rate– effect on the aggregate of the service and interest costs (146) (161) – effect on the obligation (1 183) (1 409) Estimated contributions payable in the next financial year 334 309

* Restatement to account for change in accounting policy.

25.2 Pension and provident fundsSouth AfricaThe group provides retirement benefits through two previously defined benefit plans, the Crookes Brothers Pension Fund and the Crookes Brothers Retirement Fund, both funds being registered under the Pension Funds Act, No 24 of 1956.

Although both these funds were converted from defined benefit to defined contribution funds in January 2003, they still retained a defined benefit underpin.

The defined benefit plans are administered by a separate fund that is legally separated from the company, with a board of trustees composed equally of representatives from both the employer and employees. The board is required by law to act in the interest of the fund and of all relevant stakeholders, i.e. active employees, inactive employees, retirees and employer.

The board of the funds is responsible for the investment policy with regard to the assets of the fund.

A buy-out exercise was undertaken during the course of April 2012, with changes to the rules made to remove the defined benefit liability.

The rule amendments for the retirement fund were approved during 2013, however the pension fund amendments have not as yet been approved.

52


25. NET POST-EMPLOYMENT OBLIGATIONS continued25.2 Pension and provident funds continued

The pension fund has one remaining member with guaranteed benefits.

The company also operates a defined contribution plan, namely the Crookes Brothers Provident Fund.

A valuation using the projected unit credit method was performed on the two funds by NMG Employee Benefits (Pty) Ltd, utilising information provided by the fund administrators.

The most recent actuarial valuation of the plan assets and the present value of the defined benefit obligation was carried out at 31 December 2013 by Natasha Huggett-Henchie (BBusSc FIA FASSA CFP), in her capacity as valuator of the Fund and director of NMG Employee Benefits (Pty Ltd Administrators.

The principal assumptions used for the purposes of the actuarial valuation were as follows:1 January 1 January 1 January

2014 2013* 2012*

Discount rate (%) 8,5 8,0 9,25Expected rate of salary increases (%) 7,0 7,0 7,5Average longevity at retirement age for current pensionersMales (years) PA90 (x-2) PA90 (x-2) PA90 (x-2)Females (years) PA90 (x-2) PA90 (x-2) PA90 (x-2)Average longevity at retirement age for current employees (future pensioners)Males (years) PA90 (x-2) PA90 (x-2) PA90 (x-2)Females (years) PA90 (x-2) PA90 (x-2) PA90 (x-2)Expected return on plan assets (%) 9,25 9,25 10Pension increases (%) 6,0 6,0 5,5General price inflation (%) 6,0 6,0 6,0

GROUP AND COMPANY

Restated2014 2013*

R’000 R’000

Amounts recognised in comprehensive income in respect of the defined benefit plans are as follows:

Current service cost 5 835 5 761 Net interest 23 199

Components of defined benefit costs recognised in profit or loss 5 858 5 960

The current service cost and the net interest expense for the year are included in the employee benefits expense in profit or loss.

Remeasurement of the net defined benefit (asset)/liability:

Return on plan assets (excluding amounts included in net interest expense) 12 251 9 504 Actuarial (losses)/gains arising from changes in demographic/financial/experience adjustments (4 035) (6 887) Effect of asset ceiling (1 624) (955)

Components of defined benefit income recognised in other comprehensive income 6 592 1 662 Tax effect of remeasurements (1 846) (465)

Components of defined benefit income recognised in other comprehensive income, net of tax 4 746 1 197

The amount included in the consolidated statement of financial position arising from the company’s obligations in respect of its defined benefit plans is as follows:

1 JanuaryRestated

1 JanuaryRestated

1 January 2014 2013* 2012*

R’000 R’000 R’000

Present value of defined benefit obligation 58 607 76 742 62 926Fair value of plan assets (67 252) (77 697) (60 119)Funded status (8 645) (955) 2 807Restrictions on asset recognised (2 655) (955) –

Net (asset)/liability arising from defined benefit obligation (5 990) – 2 807

* Restatement to account for change in accounting policy (note 1.3).




25. NET POST-EMPLOYMENT OBLIGATIONS continued25.2 Pension and provident funds continued

Movements in the present value of the defined benefit obligation in the current year were as follows:Restated Restated

1 January 1 January 1 January2014 2013* 2012*

R’000 R’000 R’000

Opening defined benefit obligation 76 742 62 926 59 731Current service cost 5 835 5 761 5 051Interest cost 6 181 5 869 5 639Actuarial losses/(gains) arising from changes in demographic, financial and experience adjustments 4 036 6 887 (3 567)Benefits paid (4 775) (4 701) (3 928) Settlement** (29 412) – –

Closing defined benefit obligation 58 607 76 742 62 926

Movements in the fair value of the plan assets in the current year were as follows:Restated Restated

1 January 1 January 1 January2014 2013* 2012*

R’000 R’000 R’000

Opening fair value of plan assets 77 697 60 119 56 685Expected return on plan assets 6 235 5 669 5 450Contribution from the employer 5 256 7 106 5 319Contributions from plan participants 795 822 707Benefits paid (5 570) (5 523) (4 635) Settlement of obligations** (29 412) – –Actuarial gain/(loss) 12 251 9 504 (3 407)

Closing fair value of plan assets 67 252 77 697 60 119

The plan assets are invested with the Strategic Investment Services Management Company Ltd and S.A. Road Board Stocks and are in compliance with regulation 28.

Actuarial assumptions for the determination of the defined obligation are discount rate, expected salary increases and mortality. The sensitivity analyses below have been determined based on possible changes of the respective assumptions occurring at the end of the reporting period:

– if the discount rate is 1% higher or lower, the defined benefit obligation would remain unchanged.

– if the discount rate is 1% higher or lower, the change in service cost plus net interest would decrease/increase by 0,2% respectively.

Swaziland All employees who are Swaziland citizens contribute to the government-operated Swaziland National Provident Fund, which is a defined contribution plan.

The Swaziland subsidiary contributes an amount equivalent to the employees’ contributions, which is charged against profits in the year in which it is due.

Employees who are not Swaziland citizens are entitled to be members of the group’s South African retirement fund or pension fund.

Zambia All employees contribute to the government-operated NAPSA Fund, which is a defined contribution plan.

The Zambian subsidiary contributes an amount equivalent to the employees’ contributions of 5%, which is charged against profits in the year in which it is due.

Employees who are not Zambian citizens are entitled to be members of the group’s South African retirement fund or pension fund.

Mozambique All employees contribute to the government-operated INSS fund at a rate of 3% of earnings, which is a defined contribution plan.

The Mozambican subsidiary contributes 4% of the employees’ earnings, which is charged against profits in the year in which it is due.

Employees who are not Mozambican citizens are entitled to be members of the group’s South African retirement fund or pension fund.

* Restatement to account for change in accounting policy (note 1.3).

** The retirement fund liability was settled during the year and for the remaining defined benefit pension fund member, his share of fund exceeded the defined benefit underpin.

54


26. EMPLOYEE SHARE INCENTIVE SCHEME The group issues equity-settled share-based payments to certain employees. Equity-settled share-based payments are measured at fair value at the date of grant. The fair value at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the group’s estimate of the shares that will eventually vest. Options vest over a period of five years and all shares must be taken up by way of purchase and delivery by no later than 10 years after the date of grant. The exercise price of the option is not less than the market value of the ordinary shares on the day preceding the date of grant.

Fair value is measured using the Black-Scholes option-pricing model and the following assumptions were used in valuing the option grants.

Options granted and unexpired as at 31 March 2014

Options Options Weighted Options Options Optionsas at granted average forfeited exercised Exercise as at

31 March during option price during during price 31 March2013 the year (cents) the year the year (cents) 2014

Executive directorsGS Clarke 120 000 15 000 4 376 – – – 135 000PJ Barker 31 000 – 4 486 – – – 31 000Management 38 000 22 000 5 677 – – – 60 000

Total 189 000 37 000 4 736 – – – 226 000

Options available at 31 March 2014, for further grants

Number of sharesShares reserved for the share option scheme 900 000Shares issued to the end of the financial year (385 000)Options granted and unexpired as shown above (226 000)

Balance available 289 000




27. FINANCIAL RISK MANAGEMENT Financial instruments consist primarily of cash deposits with banks, short- and medium-term investments, short- and medium-term loans, trade and other receivables and other payables, bank borrowings and loans to and from associates and subsidiaries.

Financial instruments are carried at cost, amortised cost or fair value where available for sale.

GROUP COMPANY

2014 2013 2014 2013Categories of financial instruments R’000 R’000 R’000 R’000

Financial assetsCash and bank balances 28 847 36 620 15 325 13 108Loans and receivables 59 323 30 690 34 569 20 830Unlisted investments 979 5 517 979 5 516Available-for-sale financial assets – 22 232 – 22 232 Investments carried at amortised cost 14 636 30 694 – 22 608 Loans to associates 17 186 14 936 17 186 14 936Loans to subsidiaries – – 252 946 93 010

120 971 140 689 321 005 192 240

Financial liabilitiesLong-term borrowings: interest-bearing 19 955 13 513 – – Trade and other payables 26 517 26 579 12 025 14 372 Short-term borrowings: interest-bearing 34 178 15 911 27 393 11 477 Outside shareholders’ loan 470 397 – – Loans from subsidiaries – – 69 720 54 684

81 120 56 400 109 138 80 533

27.1 Interest rate risk management Taking cognisance of the seasonality of the group's cash flows, treasury risk management positions the group's interest rate exposures according to expected movements in interest rates in the countries in which the group operates.

Group interest rate profile is as follows:Floating rate Fixed rate

Less than one year

Greater than one year

Less than one year

Greater than one year

Total borrowings

2014Borrowings (R’000) 18 052 1 045 16 126 18 910 54 133Total borrowings (%) 33 2 30 35 100

2013Borrowings (R’000) 2 129 1 551 13 782 11 962 29 424Total borrowings (%) 7 5 47 41 100

Company interest rate profile is as follows:2014Borrowings (R’000) 17 393 – 10 000 – 27 393Total borrowings (%) 63 – 37 – 100

2013Borrowings (R’000) 402 – 10 000 – 10 402Total borrowings (%) 4 – 96 – 100

Fluctuations in interest rates impact on the return on short-term cash investments and the cost of financing activities, giving rise to cash flow interest rate risk. The exposure to interest rate risk is managed through the group’s cash management system which enables the group to maximise returns while minimising risks. The group has not entered into any interest rate derivatives during the year.

56


GROUP

2014 2013

27. FINANCIAL RISK MANAGEMENT continued27.2 Liquidity risk management

Effective interest rate on borrowingsAmounts due to bankers (%) 7,0 6,5Term loans (%) 4,0 4,0Instalment sale agreements (%) 8,9 7,8Call loans (%) 10,0 10,0

Based on year end exposure to borrowings at variable interest rates, the impact of a 1% move in interest rates will have a R191 000 (2013: R194 000) effect on profit or loss and a R138 000 (2013: R140 000) impact on equity for the group.

Based on year end exposure to cash investments with yields linked to variable interest rates, the impact of a 1% move in interest rates will have a R435 000 (2013: R895 000) effect on profit or loss and a R312 000 (2013: R679 000) impact on equity for the group.

The company and group manage liquidity risk by monitoring forecast cash flows and ensuring that adequate unutilised borrowing facilities are maintained. The company and group have access to financing facilities as described in note 22.1, of which R53 million (2013: R60 million) of the unsecured facilities were unutilised at the end of the reporting period.

Short-term borrowings have been disclosed in note 22.1 to the financial statements. Trade and other payables have been disclosed in note 23 to the financial statements. All payables are due within a 30 to 60 day period.

The maturities of contractual liabilities are as follows:

2014 2013

1 to 3 months

4 to 12 months

Greater than

12 months Total1 to 3

months4 to12

months

Greater than

12 months TotalR'000 R'000 R'000 R'000 R'000 R'000 R'000 R'000

GROUPTrade and other payables 26 517 – – 26 517 26 579 – – 26 579 Outside shareholders’ loan 470 – – 470 397 – – 397 Finance leases – – – – – 1 075 – 1 075 Instalment sale agreements 97 562 1 045 1 704 92 560 1 551 2 203 Term loan arrangements 1 360 4 766 18 910 25 036 840 2 942 11 962 15 744 Bank overdrafts 17 018 – – 17 018 – – – – Call loans 375 10 000 – 10 375 402 10 000 – 10 402

45 837 15 328 19 955 81 120 28 310 14 577 13 513 56 400

COMPANYTrade and other payables 12 025 – – 12 025 14 372 – – 14 372 Finance leases – – – – – 1 075 – 1 075 Bank overdrafts 17 018 – – 17 018 – – – – Loans from subsidiaries 69 720 – – 69 720 54 684 – – 54 684 Call loans 375 10 000 – 10 375 402 10 000 – 10 402

99 138 10 000 – 109 138 69 458 11 075 – 80 533




27. FINANCIAL RISK MANAGEMENT continued27.3 Credit risk management

Credit risk consists mainly of short-term cash deposits, cash equivalent investments, trade receivables and loans. The group limits its exposure in relation to cash balances by only dealing with well established financial institutions of high quality credit standing and limits the amount of credit exposure to any one counterparty.

The group’s trade and other receivables comprise a widespread base, and group companies undertake on-going credit evaluations of the financial condition of the other parties.

At 31 March 2014, the directors did not believe there is any significant concentration of credit risk which has not been adequately provided.

Past due trade receivablesIncluded in trade receivables are debtors which are past the original expected collection date (past due) at the reporting date. A summarised age analysis of past due debtors is set out below:

GROUP COMPANY

2014 2013 2014 2013 R’000 R’000 R’000 R’000

Less than 1 month 91 41 83 37 Between 1 to 2 months 76 108 43 108 Between 2 to 3 months 26 8 24 8 Greater than 3 months 206 248 201 245

399 405 351 398

No specific trade receivables have been placed under liquidation in the current or the prior year.

An allowance for doubtful debts (note 19) is assessed annually, on a debtor-by-debtor basis, considering the credit risk of the debtor and the likely recoverability of the receivable.

27.4 Foreign currency risk management The group undertakes limited value transactions denominated in foreign currency and hence direct exposure to exchange rate fluctuations arises to a limited extent.

Exchange rate exposure is hedged through the use of forward exchange contracts where considered required. There were no material forward exchange contracts outstanding at 31 March 2014 (2013: nil).

The group’s exchange rate exposure relates to the conversion of its investments in foreign subsidiaries and earnings in non-Rand currencies which are translated into the Rand reporting currency.

The group operates in Zambia and Mozambique, the local currencies being the Kwacha (ZMW) and Meticais (MZN) respectively.

Translation exposure is not hedged.

Foreign subsidiary companies undertook limited foreign currency transactions during the year.

27.5 Commodity price risk management Commodity price risk arises from the fluctuations in the world sugar price and the impact this may have on current or future earnings potential of the group’s sugar cane crop.

The sale of sugar on the world market, as well as the related hedging activities, is undertaken by the South African Sugar Association (SASA).

Sugar cane price risk in Swaziland is not hedged by the group.

Foreign currency fluctuations relating to sugar cane sales in Zambia are not hedged.

Commodity price risk arises from fluctuations in the prices for bananas sold in the local market. The group, through its association with Lebombo Growers (Pty) Ltd (note 16.2.1), markets the sale of bananas to receive the best possible prices.

The group’s deciduous crop is subject to price and foreign currency risk arising from foreign currency fluctuations.

The group’s marketing partner, Two-A-Day Group Limited, enters into currency contracts for its export sales.

The company partakes in decisions made by Two-A-Day relative to its hedging activities via representation on the Two-A-Day board.

The group’s macadamia development is yet to bear nuts, as a result, the group is not directly exposed to commodity price risk.

58


28. FAIR VALUE MEASUREMENTThe directors are of the opinion that the book value of financial assets and liabilities does not exceed their approximate fair value.

The following table provides an analysis of financial instruments that are measured subsequent to initial recognition at fair value, grouped into levels 1 to 3 based on the degree to which the fair value is observable.

– Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities.

– Level 2 fair value measurements are those derived from inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived prices).

– Level 3 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Level 1 Level 2 Level 3 TotalR’000 R’000 R’000 R’000

2014Unlisted investments – 979 – 979 Call deposits 14 636 – – 14 636 Biological assets – – 382 691 382 691 Inventories – agricultural produce – – 37 978 37 978

Cash and bank balances 28 847 – – 28 847

43 483 979 420 669 465 131

2013Unlisted investments – 5 517 – 5 517 Available-for-sale investments (Structured Plus Portfolio) – 22 232 – 22 232 Call deposits 30 694 – – 30 694 Biological assets – – 325 024 325 024 Inventories – agricultural produce – – 17 147 17 147 Cash and bank balances 36 620 – – 36 620

67 314 27 749 342 171 437 234




28. FAIR VALUE MEASUREMENT continuedThe group’s financial assets and financial liabilities are measured at fair value on a recurring basis.

The following table gives information about how the fair values of these financial assets and financial liabilities are determined (in particular, the valuation technique(s) and inputs used).

Financial assets/financial liabilities

Fair value as at 2014

Fair value as at 2013

Fair value

hierachy

Valuation technique(s)

and key input(s)

Significant unobservable

inputs to fair value

Relationship of unobservable

inputs to fair value

Unlisted investments 979 27 749 Level 2Quoted bid prices in an

active marketN/A N/A

Biological assets 382 691 325 024 Level 3

Current estimated

market prices

for the

following season,

less the

estimated costs of

harvesting, transport,

packing and

point-of-sale costs

Estimated price, yield and inflation is

subject to fluctuation and change. Prices

are not based on published or quoted

market and commodity listings.

In arriving at the fair value, the estimated price is applied

against the expected area to harvest, together with

the estimated yields and average maturity of the crop.

Inventories – agricultural produce

37 978 17 147 Level 3

Estimated price andpackout is subject to

fluctuation and change. Prices are not based on

published or quoted market and

commodity listings.

In arriving at the fair value at the date of harvesting, the estimated price is applied

against the estimated point of sale costs incurred, in

bringing the produce to their present location and condition to be sold.

Refer to notes 4.3.2 and 15 for the accounting policy and valuation assumptions pertaining to biological assets.

The directors consider the carrying amounts of financial assets and financial liabilities recognised in the consolidated financial statements to approximate their fair values.

The impact of a 1% change in the inflation rate on bearer biological assets will have the following effect on pre-tax profit or loss:

GROUP COMPANY

2014 2013 2014 2013 R’000 R’000 R’000 R’000

Sugar cane roots 268 191 95 69Deciduous fruit trees 669 398 543 398Macadamia trees 15 – – –

952 589 638 467

The impact of a 1% change in the price or yield of biological assets – crops will have the following effect on pre-tax profit or loss:

Standing sugar cane 1 536 1 575 670 601Deciduous fruit 260 141 166 141 Bananas 79 72 79 72 Potatoes 16 – – – Grain 17 – – –

1 908 1 788 915 814

The impact of a 1% change in the price of agricultural produce will have the following effect on pre-tax profit or loss:

Agricultural produce 380 171 211 171

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29. RELATED PARTY TRANSACTIONSDuring each year, the group, in the ordinary course of business, enters into various transactions with related parties.

Parties are considered to be related if one party has the ability to control or exercise significant influence over the other party in making financial and operating decisions. These transactions occurred under terms that are no more or less favourable than those arranged with third parties.

The company’s related parties are its subsidiaries, associates and key management, including directors.

Related party transactions and balances have been eliminated on consolidation.2014 2013

R’000 R’000

29.1 Compensation relating to key management personnelThe remuneration of executive directors and three other members of key management during the year was: Salary 6 083 5 644 Bonus 2 989 2 273 Retirement, medical, accident and death benefits 1 208 1 237 Other material benefits 522 739

Total 10 802 9 893

29 .2 Associate companiesLebombo Growers (Pty) LtdShort-term receivable from associate at year end 2 999 2 278 Rebate income 4 166 2 214 Total banana marketing and transport costs paid to associate company on an arm’s-length basis 20 923 15 753

Mpambanyoni Sand (Pty) LtdLoan to associate 49 49

Mpambanyoni Construction Supplies (Pty) LtdLoan to associate 760 760

Details of material investments in associates are set out in note 16.2.

29.3 Transactions and balances with subsidiary companiesRenishaw Property Development (Pty) LtdShort-term receivable 7 155 5 951

CBL Agri International (Pty) LtdShort-term receivable 36 47 020 Interest received – 2 831

CBL Agri Services (Pty) LtdShort-term receivable 131 167 1 962 Management fees received 2 086 2 141

Mthayiza Farming (Pty) LtdShort-term receivable 442 1 463 Management fees received 96 96 Management fees paid (183) (173) Interest received 515 –Surety fee received 277 340

Kwacele Farming (Pty) LtdShort-term receivable – 2 978 Management fees received 122 194

Crookes Plantations LimitedShort-term payable (69 720) (54 684)

Murrimo Macadamia LdaShort-term receivable 65 707 13 344

Murrimo Farming LdaShort-term receivable 19 451 19 462

Details of investments in subsidiaries are set out in note 16.3.




29. RELATED PARTY TRANSACTIONS continued 29.4 Interest of directors in contracts All directors of the company have confirmed that they were not materially interested in any contract of significance with the company or any

of its subsidiaries which could have resulted in a conflict of interest during the year.

The following is a list of directors’ interests in contracts which are not considered material to the company:

Mr JAF Hewat has an effective 4,3% stake in the Vista Construction group, who were contracted by Renishaw Property Developments (Pty) Ltd to provide certain project management services.

The total amount paid to Vista for the year ended 31 March 2014 amounted to R175 560 (2013: R286 000).

29.5 Shareholdings and related interests of directors and officers in share capital Details of directors’ interests in share capital have been disclosed in the directors’ report on page 4 .

29.6 Directors’/prescribed officers’ emoluments Details of directors’ emoluments are set out in the remuneration report on pages 36 to 37 of the integrated annual report.

Details of directors’ and prescribed officers’ share options are set out in the remuneration report on page 38 of the integrated annual report.

29.7 Shareholders Details of the principal shareholders of the company and a summary of the categories of shareholders are detailed on page 54 of the

integrated annual report.

30. BUSINESS COMBINATIONS The group acquired a 1 815 hectare deciduous fruit farm in the Western Cape on 23 December 2013. The full consideration of R103 million was paid in cash.

The farm, known as High Noon, was acquired to continue the expansion of the group’s deciduous fruit segment.

30.1 Assets acquired and liabilities recognised at the date of acquisitionR’000

Non-current assets Plant and equipment 1 678 Land and buildings 88 722 Biological assets – bearer 17 498 Shares 1

Non-current liabilities Deferred tax liabilities (4 899)

103 000

29.2 Goodwill arising on acquisition Consideration transferred 103 000 Less: fair value of identifiable net assets acquired 103 000 Goodwill arising on acquisition –

Based on experience in the deciduous sector, utilising best practise valuation techniques and assessing the fair values against existing deciduous fruit farms in the group, an offer of R103 million was accepted as a fair price for the identified assets being acquired, and hence no goodwill was recognised.

Acquisition-related costs have been excluded from the consideration transferred and have been recognised as an expense in profit or loss in the current year, within the administrative expenses line item.

29.3 Impact of acquisitions on the results of the group Included in profit for the year is R5,7 million attributable to the additional business acquired in the High Noon acquisition attributable to the

period after the transaction became unconditional.

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GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

31. OPERATING LEASE ARRANGEMENTSOperating leases relate to leases of land used for the group’s sugar cane and banana operations.

The lease terms vary between five and 15 years.

The group does not have an option to purchase the leased land at the expiry of the lease terms.

31.1 Payments recognised as an expenseMinimum lease payments 5 404 5 101 2 300 2 300

5 404 5 101 2 300 2 300

The lease from the Department of Rural Development: Land Affairs (note 22.2) is based on a fixed rate per annum, escalated by 7% in July of each year.

The lease rental from the Libuyile Community Trust (note 22.2) is based on a fixed Rand rate per hectare under crop, the rate being escalated annually by CPI (Consumer Price Index).

31.2 The group’s commitments in respect of operating leases are as follows: Not later than one year 4 634 5 250 2 622 2 450Later than one year and not later than five years 10 852 13 823 2 805 2 622Later than five years 9 053 16 360 – –

24 539 35 433 5 427 5 072

32. PROPOSED CAPITAL EXPENDITURE Contracted 11 183 15 182 4 894 7 142Authorised by the directors but not yet contracted 89 644 47 993 11 231 13 304

100 827 63 175 16 125 20 446

The authorised capital expenditure proposed includes capital requirements of R64 million for the group’s continued expansion into Mozambique and R19 million of other expansion and improvement capital.

The above expenditure will be funded from the group’s liquid resources and short-term borrowing facilities.




GROUP COMPANY

2014 2013 2014 2013R’000 R’000 R’000 R’000

33. GUARANTEES, CONTINGENT LIABILITIES AND CONTINGENT ASSETS 33.1 Guarantees

The company has provided a guarantee to the Department: Minerals & Energy for the rehabilitation of the sand winning area in the Mpambanyoni River 30 30 30 30

First National Bank has provided other guarantees on behalf of the group 56 56 – –

33.2 Contingent liabilities A contingent liability exists as a result of the company’s interest in a subsidiary. The company has provided surety for its

subsidiary’s term loan arrangements (note 22.2) 25 036 15 744 25 036 15 744

The company previously had a rates dispute with the Umdoni Municipality.

An agreement was reached during the year for a reduced settlement – 661 – 661

34. EVENTS AFTER THE REPORTING PERIODThere have been no major changes in the affairs or financial position of the group or its subsidiary companies since the end of the year under review.

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CORPORATE INFORMATION

Company name: Crookes Brothers LimitedRegistered office: Renishaw, KwaZulu-Natal

Postal address: PO Renishaw, 4181Telephone: 039 978 4600

Telefax: 039 978 4628E-mail: [email protected]

Website: www.cbl.co.za

Share code: CKSCompany registration number: 1913/000290/06

Company secretary: Highway Corporate Services (Proprietary) LimitedBusiness address: 14 Hillcrest Office Park, 2 Old Main Road, Hillcrest

Postal address: PO Box 1319, Hillcrest, 3650Telephone: 031 765 4989

Telefax: 086 679 3461

Transfer secretaries: Computershare Investor Services (Proprietary) LimitedBusiness address: 70 Marshall Street, Johannesburg

Postal address: PO Box 61051, Marshalltown, 2107Telephone: 011 370 5000

Telefax: 011 688 5200

Auditors: Deloitte & ToucheAttorneys: Livingston Leandy Inc.

Bankers: FirstRand Bank LimitedInvestec Bank Limited

Sponsor: Sasfin Capital (A division of Sasfin Bank Limited)


www.cbl.co.za

Crookes Brothers Limited

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