INVESTING IN OUR FUTURE - Winfresh...5 INVESTING IN OUR FUTURE REGISTERED ADDRESSES WINFRESH LIMITED...

2016 ANNUAL REPORT

INVESTING IN OUR FUTURE

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WINFRESH LIMITED

C O N T E N T S

Page

Corporate Profile 4 – 5

Group Directors 6 – 7

Directors’ Report 8 – 10

Performance Summary 11

Group Executives 12

Company Information 13

Independent Auditor’s Report 14 – 15

Financial Reports 16 – 51

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4

CORPORATE PROFILE

The principal activities of the Group during the period continued to be the importation of bananas into the United Kingdom and the subsequent ripening, distribution and sale of these, as well as importation and sale of fresh produce. In addition, the Group has been involved in the development and production of a range of food products; sauces, fruit juices and cordials, a non-dairy frozen fruit dessert and bottled water.

S H A R E H O L D E R S

The shareholders of Winfresh are the Governments of the four Windward Islands, Saint Lucia, Dominica, St. Vincent and the Grenadines and Grenada; Saint Lucia Agricultural Holding Company (“SLAHC”), Dominica Banana Holding Company (“DBHC”); St Vincent Banana Growers’ Association (“SVBGA”) and the Grenada Banana Co-operative Society (“GBCS”). SVBGA and GBCS have been dissolved and the shares held by them are to be transferred to the respective Governments in accordance with the provisions of the Shareholders’ Agreement.

S U B S I D I A R Y C O M P A N I E S

1 Winfresh (UK) Limited 2 Vincyfresh Limited 3 Sunfresh Limited 4 Grenfresh Limited

A S S O C I A T E D C O M P A N I E S

5 Windward Isles Banana Company Holdings (Jersey) Limited 6 Geest Line Limited

T H E W I N F R E S H G R O U P

The Winfresh Group comprises the parent company, Winfresh Limited, together with the following wholly-owned subsidiary undertakings and associated companies:

G R O U P D I R E C T O R S

Cecil Ryan (Chairman) Vanoulst Jno Charles Michael Church Montgomery Daniel Ezechiel Joseph Cleophas Regobert Renwick Rose Simon Stiell Deles Warrington

Bernard Cornibert (Subsidiaries only) Martina Edwin (Winfresh UK only)

G R O U P E X E C U T I V E S

Bernard Cornibert Chief Executive Martina Edwin Company Secretary Lindsay Lougheed Finance Director Ashley James UK Operations Director Rahjim Albertinie Procurement Director Mark Crawford Commercial Director Kemston Cato Manufacturing Operations Director

M I S S I O N S T A T E M E N T

To serve our customers with a range of high quality products and services at just prices, to pay fair prices to our suppliers and to return fair value to our shareholders.

We aim to do so by working in partnership with our suppliers in a manner that is socially and morally responsible and commands respect for our integrity and the positive contributions we make to the societies we serve.

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R E G I S T E R E D A D D R E S S E S

W I N F R E S H L I M I T E D

Reg. No. 47 of 1994

Odsan, Castries, Saint Lucia WI

W I N F R E S H ( U K ) L I M I T E D

Reg. No: 2929097

High Cross Lane East, Little Canfield, Essex CM6 1TH (United Kingdom)

S U N F R E S H L I M I T E D

Reg. No. 318 of 2010

Cul de Sac, Castries, Saint Lucia WI

B U S I N E S S A D D R E S S E S

W I N F R E S H L I M I T E D

Agricultural Complex, Odsan, PO Box 115, Castries, Saint Lucia

Telephone +1 758 457-8600Fax +1 758 453-1638

W I N F R E S H U K

High Cross Lane East, Little Canfield Essex CM6 1TH (United Kingdom)

Telephone +44 (0) 1371 877 000Fax +44 (0) 1371 873 531

S U N F R E S H L I M I T E D

Cul de Sac, PO Box JB39, Castries, Saint Lucia WI

Telephone +1 758 451-5785Fax +1 758 451-5607

A U D I T O R S

P R I C E B A I L E Y L L P

3rd Floor, 24 Old Bond Street, London W1S 4AP (United Kingdom)

G L L E W E L L Y N G I L L & C O (for and on behalf of Price Bailey)

Mc Vane Drive, Sans Soucis, PO Box 546, Castries, Saint Lucia

B A N K E R S

B A N K O F S T L U C I A

Bridge Street, PO Box 1031, Castries, Saint Lucia WI

B A R C L AY S B A N K P L C

50 Pall Mall, London SW1Y 5AX (United Kingdom)

C R O W N A G E N T S B A N K

St. Nicholas House, Sutton, Surrey SM11EL (United Kingdom)

S O L I C I T O R S

C H O N G & C O

B A R R I S T E R S - A T - L A W, S O L I C I T O R S & N O T A R I E S R O YA L

27 Micoud Street, PO Box 81, Castries, Saint Lucia

T E E S L A W

High Street, Bishop’s Stortford, Hertfordshire CM23 2LU

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Group Directors

C E C I L RYA NChairman

E Z E C H I E L J O S E P H(Main Board)

M I C H A E L C H U R C H(Main Board)

VA N O U L S T J N O C H A R L E S(Main Board)

M O N T G O M E RY D A N I E L(Main Board)

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S I M O N S T I E L L(Main Board)

D E L E S W A R R I N G T O N(Main Board)

B E R N A R D C O R N I B E R T(Subsidiaries only)

R E N W I C K R O S E(Main Board)

C L E O P H A S R E G O B E R T (Main Board)

M A R T I N A E D W I N(Winfresh UK only)

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8

dIRECTORs’ REPORT

The Directors present their report and consolidated financial statements, in Eastern Caribbean Dollars (XCD), for the Winfresh Group for the period ended 31 December 2016. The Eastern Caribbean Dollar is fixed to the US Dollar (USD) at the rate of USD 1 = XCD 2.70.

R E S U L T S A N D P E R F O R M A N C E

The Group’s results for the period are set out in the statement of comprehensive income on pages 16 to 51. The Group’s consolidated earnings from operations on its core activities before adjustments for joint ventures and associated undertakings and taxation was a loss of $4,809,151, compared to profit of $5,551,102 for the previous year. The fall in profit was due largely to the fall in the £/$ exchange rate, which manifested in a drop in sales of $4,274,362 or 6.9%, despite sales in £-Sterling having increased by £6,029,185 or 11.5%.

Earnings for the period, after taxation and inclusion of the share of earnings from joint ventures, dropped to a loss of $3,856,494 in the period under review, from $5,883,753 in the previous year.

The consolidated Group profit/loss from joint ventures and associated companies was a profit of $6,131,101 compared to a loss of $1,911,716 in the previous period. Total comprehensive earnings for the period was a loss of $6,959,837 compared to profit of $2,789,449 in the previous period.

The Directors recommend the payment of a dividend on the preference shares for the period.

Although the Group’s overall or comprehensive earnings in the period moved significantly in the opposite and negative direction, the directors believe that the businesses of the Group remain fundamentally sound and on track and that the results and performance do not adequately reflect the realities facing the Group and its capacity to cope with the relentless pressures and challenges of the market.

Total volume of bananas imported from the Windward Islands was 15.9% lower in the period under review than in the previous period; the result of disruption in supplies caused by Tropical Storm Matthew in the last quarter of the period. Banana purchase volume from the Windward Islands accounted for 10.3% of the total purchase, compared to 15.3% in the previous period. Supplies from the traditional Caribbean sources accounted for 74.4% of total purchase compared to 95.0% in the previous period.

“Fairtrade” continued to dominate the Company’s product offer, which is entirely customer driven. Fairtrade bananas accounted for more than 95% of the Company’s total volume sales of bananas. The Fairtrade International sets the minimum Ex-works and FOB prices for Fairtrade bananas, by which all traders of Fairtrade bananas are bound. There were some minor changes in the minimum prices for the period. The average unit cost of bananas imported by the Company was marginally up (1.0%) from the previous period, reflecting changes in sourcing and product mix.The dramatic devaluation of £-Sterling following the result of the BREXIT referendum during the period under the review had a significant impact on the results. Not just to the extent that some of the Dollar denominated costs were not fully covered by the exchange risk mitigation arrangements in place with key customers but particularly and more profoundly by the impact of the currency translation of both revenue and costs from GBP to XCD, in which these financial statements are presented.

P R I N C I PA L R I S K S A N D U N C E R T A I N T I E S

The uncertainties and risks in the fresh produce sector remain undiminished and are likely to exacerbate, as the impact of the BREXIT vote continue to bite, before the UK economy fully adjusts to the post-Brexit trading arrangements. The rise in cost inflation engendered by the fall in the value of £-Sterling will compound the persistent pressure on prices. Although there have been some upward adjustments in retail prices, the downward pressure on costs is unlikely to be

D I R E C T O R S W H O S E R V E D D U R I N G T H E Y E A R

Simon Stiell (Chairman) Vanoulst Jno Charles Michael Church Montgomery Daniel Renwick Rose Cecil Ryan Deles Warrington

James Fletcher (resigned 28 July 2016) Hippolyte E Vitalis (resigned 28 July 2016) Ezechiel Joseph (appointed 28 July 2016) Cleophas Regobert (appointed 28 July 2016) Bernard Cornibert (Subsidiaries only) Martina Edwin (Winfresh UK only)

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relaxed as retailers seek to contain the inflationary impact on prices. This persistent pressure to keep prices down while the lid cannot be maintained on costs remains a defining challenge for the Company and an existential risk to its core business. This is by no means unique to the Company but with a challenging supply base the risk to the Company is compounded.

Notwithstanding the persistent market pressures, the Group is fully focused on and committed to supplying its customers with the highest quality of products and services.

It is difficult, if not impossible, in any analysis on the risks and uncertainties facing the Group to ignore the perennial challenges with the Company’s traditional Caribbean banana supply sources. Recent events, with tropical storms and hurricanes, have demonstrated why these must and will remain at the forefront of the Company’s concerns and focus. The supply difficulties resulting from those problems are challenging but they are by no means insurmountable and so the Company will continue to do everything conceivable to deal with them in a manner that allows it to honour its supply commitment to its customers.

Equally, it is difficult to avoid the issue of climate change; the increased frequency and devastating impact on the production and infrastructure in the region that the Group is most reliant on for its supplies. Supply disruption in the Company’s dominant Caribbean origins from the impact of climate change is now an accepted and even regular reality but this is no reason to give up on what is the soul or raison d’etre of the Company. The Company is committed to its Caribbean roots and will continue to stand shoulder-to-shoulder with its suppliers there, hopefully, with the commitment and support of its key customers, with whom it has had a long-established relationship. This, by no means, suggests that the Company will relax in complacency or take its customers or the competition for granted. Instead, it will redouble its efforts in taking all necessary measures to mitigate the impact of any supply difficulties on its customers and its business.

F I N A N C I A L I N S T R U M E N T R I S K S

The business of the Group, like those of many in the agriculture produce trade, are exposed to the risks and uncertainties associated with unpredictable movements in energy costs and currency rates. Indeed, recent events have brought these into sharp focus. The extent of the risk could rise or fall with developing events but the Group will remain on guard and will monitor and be ready to take all necessary measures not only to reduce the exposure of the businesses to those uncertainties but to act swiftly to minimise losses.

The Company has established a risk and financial management framework, the primary objectives of which are to protect the Group from events that hinder the achievement of their performance objectives. These aim to limit undue counterparty exposure, ensure sufficient working capital exists and monitor the management of risk at a business unit level.

F I N A N C I A L K E Y P E R F O R M A N C E I N D I C A T O R S

Many of these negative movements from the previous period were caused largely by negative currency translation stemming from the fall in the conversion value of £-Sterling. For example, as already shown, the total value of sales for the period was up in GBP by 11.5% but down by 6.9% in XCD from the previous period, reflecting the fall in the £/$ exchange rate. Similarly, gross profit in GBP was down by 23.9% compared to a drop of 36.5% in XCD. Conversely, the total cost of sales in GBP was up by 17.0% but down in XCD by 2.3%. This demonstrates the pervasive and erratic influence of the movement of the £/$ exchange rate on the results. This is because, hitherto, the bulk of the revenue is earned in GBP and so it is important to contextualise the movements or changes in those key indicators and to interpret them correctly. Many of them, but for the currency translation impact, have actually moved in directions that are the opposite of what are shown above.

I N D I C A T O R M O V E M E N T E X T E N T D I R E C T I O N

1 Turnover Down $14.274m (6.9%) Negative2 Cost of Sales Down $4.206m (2.3%) Positive3 Gross Profit Down $10.068m (36.5%) Negative4 Distribution & Selling Cost Down $0.953m (8.8%) Positive5 Administrative & General Expenses Up $1.245m (11.1%) Negative6 Operating Profit (EBIT) Down $10.360m (186.6%) Negative7 Profit before Share of Joint Ventures, Associates Down $16.803m (194.7%) Negative8 Total Recognised Profit Down $9.749m (349.5%) Negative9 Retained Earnings Down $6.809m (14.3%) Negative

10 Net Current Assets (Working Capital) Down $11.703m (372.9%) Negative11 Cash Down $1.454m (28.2%) Negative12 Total Assets Down $5.038m (5.1%) Negative13 Total Liabilities Up $1.921m (3.8%) Negative14 Shareholders’ Funds Down $6.960m (14.4%) Negative

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F U T U R E D E V E L O P M E N T S – O B J E C T I V E S A N D S T R A T E G Y

The ethics of Fairtrade are an integral element of the Company’s trading arrangements and the tenets underlying Fairtrade will remain the guiding principles of the Company’s business arrangements; whether with customers, suppliers or service providers. However, Fairtrade, as a movement and brand, will have to undergo some changes if it is to remain true and relevant to its cause and to continue to deliver value to the customers and consumers that patronise Fairtrade.

The decision by Sainsbury’s, the largest retailer of Fairtrade products, to pilot launch its “Fairly Trade” brand through its own foundation has created a crisis for the Fairtrade brand, and given testimony to the need for change.

This development was not entirely surprising. The Company has raised many concerns with the Fairtrade Foundation in the past. Concerns ranging from the wide gaps in minimum prices among origins, the apparent lack of benchmarking and transparency in establishing those prices, to the frustrating issue of the lack of differential treatment of small holder farmers relative to the plantation or large farmers. Concerns, which hitherto have gone unheeded.

The Company hopes that this development will open the way for constructive dialogue on those and other issues that will contribute positively to the promotion of the long-terms objectives of the scheme. For its part, the Company will continue to promote and follow the principles of fair trade, wherever or under whatever scheme this can be done effectively.

The Winfresh Group has had to delay the launch of its new range of manufactured food products because of production equipment and start-up delays. However, these, as well as the finalisation of production arrangements for the “Fruit Scoop”, will be the primary focus of the Group over the next 18 months.

The Company will ensure that its core banana business continues to play a pivotal role in the Group’s business activities, while pursuing vigorously the diversification objectives of the Group and the growth and development of the non-banana crop sector in the Windward Islands.

E M P L O Y E E S A N D E M P L O Y E E I N V O LV E M E N T

During the year the Group’s policy of providing employees with information about the Group continued through announcements and briefings in which the employees have also been encouraged to present their suggestions and views on the Group’s operations.

C R E D I T O R PAY M E N T P O L I C Y A N D P R A C T I C E

The Group’s policy concerning the payment of trade payables (creditors) is to agree the terms of payment with its suppliers when agreeing the terms of each contract; to ensure that suppliers are made aware of these terms by inclusion of the relevant terms in supply contracts where appropriate; and to pay trade payables in accordance with those contractual obligations. On average and based on the results for the entire period, trade payables at the statement of financial position date represented an average of 25 days.

P O S T B A L A N C E S H E E T E V E N T S

There were no significant events after the balance sheet date affecting the Group or the company, which have not been disclosed in the consolidated financial statements.

A U D I T O R S

In accordance with the company’s articles, a resolution proposing that Price Bailey LLP be appointed as auditors of the company will be put to the General Meeting.

S T A T E M E N T O F D I S C L O S U R E O F I N F O R M A T I O N T O A U D I T O R S

The Directors who held office at the date of approval of this Directors’ Report confirm that:

A So far as the Directors are aware, all relevant audit information was disclosed to the Group’s auditors and there is none of which they were uninformed.

B The Directors have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that the Group’s auditors are aware of that information.

By the Order of the Board

Martina EdwinC O M PA N Y S E C R E TA R Y

Approved by the Board of Directors on14 December 2017

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GROUP ExecutiveS

B E R N A R D C O R N I B E R TChief Executive

R A H J I M A L B E R T I N I EProcurement Director

L I N D S AY L O U G H E E DFinance Director

M A R K C R A W F O R DCommercial Director

A S H L E Y J A M E SUK Operations Director

K E M S T O N C A T OManufacturing Operations Director

M A R T I N A E D W I N Company Secretary

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WINFRESH LIMITED

C O M PA N Y I N F O R M A T I O N

Directors M DanielV Jno CharlesC F RyanD WarringtonJ L Fletcher (resigned on September 15, 2016)S StiellH E Vitalis (resigned on September 15, 2016)R RoseM ChurchC RegobertE Joseph

Company number No. 47 of 1994

Registered office 99 Chaussee RoadCastriesSaint Lucia

Auditors G Llewellyn Gill & CoChartered Accountants(for and on behalf of Price Bailey)McVane DriveSans SoucisPO Box 546CastriesSaint Lucia

Accountants Price Bailey Mayfair LLPChartered Accountants24 Old Bond StreetLondonW1S 4APUnited Kingdom

Business address Agricultural ComplexOdsanPO Box 115CastriesSaint Lucia

Bankers Bank of Saint Lucia1 Bridge StreetPO Box 1862CastriesSaint Lucia

Solicitors Chong & CoBarristers-at-LawSolicitors & Notaries Royal Chambers27 Micoud StreetPO Box 81CastriesSaint Lucia

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I N D E P E N D E N T A U D I T O R ’S R E P O R TT O T H E S H A R E H O L D E R S O F W I N F R E S H L I M I T E D

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I N D E P E N D E N T A U D I T O R ’S R E P O R T ( C O N T I N U E D )T O T H E S H A R E H O L D E R S O F W I N F R E S H L I M I T E D

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WINFRESH LIMITED

C O N S O L I D A T E D S T A T E M E N T O F P R O F I T O R L O S S A N D O T H E R C O M P R E H E N S I V E I N C O M EF O R T H E P E R I O D E N D E D D E C E M B E R 31, 2 016

Note

Period ended December 31 2016

$

Period ended January 2 2016

$

Revenue

Sales of goods 6 193,482,062 207,756,424

Cost of goods sold 27 (175,937,081) (180,143,378)

Profit from trading 17,544,981 27,613,046

Distribution and selling expenses 27 (9,857,335) (10,810,496)

Administrative and general expenses

27 (12,496,797) (11,251,448)

(4,809,151) 5,551,102

Finance costs 7 (1,108,079) (1,223,910)

Other (losses)/gains, net 8 (3,010,984) 925,034

Other income 9 756,805 3,379,729

(Loss)/profit before share of profit in joint ventures and income tax

(8,171,409) 8,631,955

Share of profit/(losses) in joint ventures

20 6,131,101 (1,911,716)

(Loss)/profit before income tax (2,040,308) 6,720,239

Income tax expense 10 (1,816,186) (836,486)

(Loss)/profit for the period (3,856,494) 5,883,753

(Expressed in Eastern Caribbean Dollars)

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WINFRESH LIMITED

C O N S O L I D A T E D S T A T E M E N T O F P R O F I T O R L O S S A N D O T H E R C O M P R E H E N S I V E I N C O M EF O R T H E P E R I O D E N D E D D E C E M B E R 31, 2 016

Note

Period ended December 31 2016

$

Period ended January 2 2016

$


Other comprehensive income

Items that will not be reclassified to profit or loss

Share of joint venture actuarial losses on defined benefit pensions plans

20 (2,220,317) (585,682)

(2,220,317) (585,682)

Items that may subsequently be reclassified to profit or loss

Currency movement for the period

(883,026) (2,508,622)

(883,026) (2,508,622)

Total other comprehensive loss for the period (3,103,343) (3,094,304)

Total comprehensive (loss)/ income for the period (6,959,837) 2,789,449


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WINFRESH LIMITED

C O N S O L I D A T E D S T A T E M E N T O F C H A N G E S I N E Q U I T YF O R T H E P E R I O D E N D E D D E C E M B E R 31, 2 016

Share capital

$

Contributed capital

$

Currency translation

$

Retained earnings reserves

$

Total

$

Non- controlling

interests$

Total equity

$

Balance at December 28, 2014

20,000,000 198,940 (16,972,658) 43,762,068 46,988,350 (894,135) 46,094,215

Comprehensive income:Profit for the period after taxation

5,883,753 5,883,753 5,883,753

Other comprehensive loss:

Items that may be subsequently reclassified to profit or loss. Currency movements for the Period

(2,508,622) (2,508,622) (2,508,622)

Share of actuarial loss of joint venture’s defined benefit pension scheme

(585,682) (585,682) (585,682)

Total other comprehensive loss (2,508,622) (585,682) (3,094,304) (3,094,304)

Total comprehensiveincome/(loss) (2,508,622) 5,298,071 2,789,449 2,789,449

Transactions with owners: Amortisation of contributed capital

(19,894) 19,894

Acquisition of non- controlling interest in Vincyfresh Limited

(1,394,135) (1,394,135) 894,135 (500,000)

Total transactions with owners, recognised directly in equity

(19,894) (1,374,241) (1,394,135) 894,135 (500,000)

Balance at January 2, 2016 20,000,000 179,046 (19,481,280) 47,685,898 48,383,664 48,383,664


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C O N S O L I D A T E D S T A T E M E N T O F C H A N G E S I N E Q U I T YF O R T H E P E R I O D E N D E D D E C E M B E R 31, 2 016

Share capital

$

Contributed capital

$

Currency translation

reserves$

Retained earnings

$

Total

$

Balance at January 3, 2016

20,000,000 179,046 (19,481,280) 47,685,898 48,383,664

Comprehensive loss:Loss for the period after taxation

(3,856,494) (3,856,494)

(3,856,494) (3,856,494)

Other comprehensive loss:

Items that may be subsequentlyreclassified to profit or loss.Currency movements for the period

(883,026) (883,026)

Share of actuarial loss of jointventure’s defined benefitpension scheme

(2,220,317) (2,220,317)

Total other comprehensive loss (883,026) (2,220,317) (3,103,343)

Total comprehensive loss (883,026) (6,076,811) (6,959,837)

Transactions with owners:Amortisation of contributed capital

(17,905) 17,905

Total transactions with owners,recognised directly in equity (17,905) 17,905

Balance at December 31, 2016 20,000,000 161,141 (20,364,306) 41,626,992 41,423,827


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C O N S O L I D A T E D S T A T E M E N T O F F I N A N C I A L P O S I T I O NA S O F D E C E M B E R 31, 2 016

December 31, 2016$

January 2, 2016$

Assets Note

Current assets

Cash and cash equivalents 11 5,714,230 6,674,776

Held-to-maturity financial assets 12 1,493,298 1,437,194

Trade and other receivables 13 24,352,918 29,362,803

Inventories 15 9,034,812 10,820,277

40,595,258 48,295,050

Non-current assets

Due from related parties 16 908,253 908,253

Other receivables 17 166,519 51,015

Intangible fixed assets 18 33,171 59,589

Property, plant and equipment 19 39,227,543 35,446,852

Investments in joint ventures 20 6,013,676 4,467,230

Investment in government bond 21 7,147,394 7,147,394

Other investments 22 2,654,000

Deferred tax asset 23 472,308 573,099

53,968,864 51,307,432

Total assets 94,564,122 99,602,482

Liabilities

Current liabilities

Bank loans and overdrafts 24 18,359,189 17,436,699

Trade and other payables 25 30,224,079 27,446,278

Income tax payable 576,627 274,201

49,159,895 45,157,178

Non-current liabilities

Loans and borrowings 24 3,980,400 6,061,640

Total liabilities 53,140,295 51,218,818


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These consolidated financial statements were approved by the Board of Directors on 14th December 2017 and were signed on its behalf by:

..................................................... .....................................................Cecil Ryan Cleophas Regobert Director Director

WINFRESH LIMITED

C O N S O L I D A T E D S T A T E M E N T O F F I N A N C I A L P O S I T I O N ( C O N T I N U E D )A S O F D E C E M B E R 31, 2 016

December 31 2016

$

January 2 2016

$

Equity

Share capital 26 20,000,000 20,000,000

Contributed capital and reserves 161,141 179,046

Currency translation reserve (20,364,306) (19,481,280)

Retained earnings 41,626,992 47,685,898

Total equity 41,423,827 48,383,664

Total liabilities and shareholders’ equity 94,564,122 99,602,482


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C O N S O L I D A T E D S T A T E M E N T O F C A S H F L O W SF O R T H E P E R I O D E N D E D D E C E M B E R 31, 2 016

Note

December 31 2016

$

January 2 2016

$

Cash flows from operating activities


Adjustments for:

Depreciation and amortisation 18, 19 2,517,298 2,873,571

Unrealised exchange loss/(gain) 2,005,260 (1,835,905)

Gain on disposal of property, plant and equipment (34,209) (34,284)

Finance income 9 (427,982) (3,038,877)

Share of (profit)/loss in joint ventures 20 (6,131,101) 1,911,716

Provision for impairment of investment in joint venture 8 330,035

Finance costs 7 1,108,079 1,223,910

Operating (loss)/profit before working capital changes (2,672,928) 7,820,370

Decrease/(increase) in trade and other receivables 4,894,381 (2,733,360)

Decrease/(increase) in inventories 1,785,465 (1,992,276)

Increase in trade and other payables 2,277,801 6,932,394

Cash generated from operating activities 6,284,719 10,027,128

Interest paid 7 (1,108,079) (1,223,910)

Interest received 9 427,982 330,858

Taxation (275,938) (1,492,973)

Net cash generated from operating activities 5,328,684 7,641,103

Cash flows from investing activities

Payments to acquire property, plant and equipment 19 (7,221,311) (1,965,488)

Payments to acquire investment in joint venture (3)

Payment to acquire other investments (56,104) (54,635)

Proceeds from disposal of property, plant and equipment 37,190 1,444,245

Net cash used in investing activities (7,240,228) (575,878)

Cash flows from financing activities

Loan repayment (1,155,904) (4,807,623)

New loan 2,698,970

Net cash generated from/(used in) investing activities 1,543,066 (4,807,623)

Net (decrease)/increase in cash and cash equivalents (368,478) 2,257,602

Net foreign exchange difference (1,085,082) (290,159)

Cash and cash equivalents at beginning of period 5,150,893 3,183,450

Cash and cash equivalents at end of period 11 3,697,333 5,150,893


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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T SD E C E M B E R 31, 2 016

1 General information

Incorporation

These consolidated financial statements include the financial statements of Winfresh Limited (the Company) and its subsidiary companies, Winfresh UK Limited, Vincyfresh Limited, Sunfresh Limited and Grenfresh Limited.

Winfresh Limited was incorporated under the laws of Saint Lucia and continued under the Company’s Act, 1996. The Company commenced trading effective January 1, 1995 with the takeover of the operations formally undertaken by Windward Islands Banana Growers’ Association (“WINBAN”).

Winfresh (UK) Limited was incorporated as a private Company, limited by shares, under the Companies Act 1985 of the United Kingdom, commenced trading in May 1994, and is a wholly owned subsidiary of Winfresh Limited.

Vincyfresh Limited was incorporated under the 1994 Companies Act of Saint Vincent and the Grenadines as Lauders Agro Processors Inc., commenced trading in October 2007, and is a wholly owned subsidiary of Winfresh Limited.

Sunfresh Limited was incorporated under the laws of Saint Lucia and continued under the Company’s Act, 1996, commenced trading in January 2011 and is a wholly owned subsidiary of Winfresh Limited.

The Company’s registered office is located at 99 Chaussee Road, Castries, Saint Lucia. Its place of business is located at Agricultural complex, Osdan, PO Box 115, Castries, Saint Lucia.

Principal activities

The principal activities of the Group continued to be that of the importation, marketing and distribution of bananas and fresh produce, and processing, packaging and distribution of condiments, water and fruit juices.

Shareholdings

The shareholdings of the Company are the Governments of the four Windward Islands: Saint Lucia, Dominica, Saint Vincent and the Grenadines and Grenada, and the banana grower associations (“BGAs”) and agricultural companies of the Windward Islands: St. Vincent Banana Growers’ Association (“SVBGA”) and Grenada Banana Co-operative Society (“GBCS”), Dominica Banana Holding Company and Saint Lucia Agricultural Holding Company.

The Group’s financial period represents a 52 week period ending December 31, 2016 (2015 – 53 week period ending January 2, 2016).

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N O T E S T O T H E C O N S O L I D A T E D F I N A N C I A L S T A T E M E N T S ( C O N T I N U E D )D E C E M B E R 31, 2 016

2 Basis of preparation

(a) Statement of compliance These consolidated financial statements have been prepared in accordance with International Financial

Reporting Standards (IFRS).

(b) Basis of measurement The consolidated financial statements have been prepared under the historical cost convention.

(c) Functional and presentation currency Items included in the consolidated financial statements are measured using the currency of the primary

economic environment in which the entity operates (“the functional currency”), which is the Eastern Caribbean Dollars (EC$). The consolidated financial statements are presented in Eastern Caribbean Dollars, which is the Company’s functional and presentation currency. All values are rounded to the nearest EC$ ($).

(d) Use of estimates and judgements The preparation of consolidated financial statements in conformity with IFRS requires management to make

judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in note 5.

Estimates and assumptions are reviewed on an on-going basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected.

In particular, information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment with the next accounting period are included in the following notes:

* Trade receivables Note 3 * Property, plant and equipment Note 3 * Impairment of non-financial assets Note 3 * Determination of fair values Note 5

(e) Standards and amendments effective and relevant to the Company The consolidated financial statements have been prepared in accordance with IFRSs, which were effective

as at December 31, 2016.

The following IFRSs and International Accounting Standards [IASs] became effective during the period:

IAS 1 Presentation of Financial Statements – Amendments resulting from the disclosure initiative. IAS 16 Property, Plant and Equipment – Amendments regarding the clarification of acceptable methods of

depreciation and amortisation. IAS 16 Property, Plant and Equipment – Amendments bringing bearer plants into the scope of IAS 16. IAS 19 Employee Benefits – Amendments resulting from September 2014 Annual Improvements to IFRSs. IAS 27 Separate Financial Statements – Amendments reinstating the equity method as an accounting option

for investments in subsidiaries, joint ventures and associates in an entity’s separate financial statements. IAS 28 Investments in Associates and Joint Ventures – Amendments regarding the application of the

consolidation Exception. IAS 38 Intangible Assets – Amendments regarding the clarification of acceptable methods of depreciation

and amortisation. IFRS 5 Non-current Assets Held for Sale and Discontinued Operations – Amendments resulting from

September 2014 Annual Improvements to IFRSs.

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2 Basis of preparation (continued)

(e) Standards and amendments effective and relevant to the Company

IFRS 7 Financial Instruments: Disclosures – Amendments resulting from September 2014 Annual Improvements to IFRSs.

IFRS 10 Consolidated Financial Statements – Amendments regarding the application of the consolidation exception.

IFRS 11 Amendment regarding the accounting for acquisitions of an interest in a joint operation. IFRS 12 Disclosure of Interests in Other Entities – Amendments regarding the application of the

consolidation exception. IFRS 14 Regulatory Deferral Accounts – Original issue.

At the date of authorisation the following Standards and Interpretations, which have not yet been applied in these financial statements, were in issue but not yet effective:

IAS 7 Statement of Cash Flows – Amendment as result of the Disclosure initiative. IAS 12 Income taxes – Amendments regarding the recognition of deferred tax assets for

unrealised losses. IAS 28 Investments in Associates and Joint Ventures – Amendments regarding the sale or contribution

of assets between an investor and its associate or joint venture. IAS 28 Investments in Associates and Joint Ventures – Amendments resulting from Annual

Improvements 2014-2016 Cycle (clarifying certain fair value measurements). IAS 28 Investments in Associates and Joint Ventures – Amendments regarding long-term interests in

associates and joint ventures. IAS 40 Investment Property – Amendments to clarify transfers of property to, or from, investment

property. IFRS 2 Share-based Payment – Amendments to clarify the classification and measurement of

sharebased payment transactions. IFRS 4 Insurance Contracts – Amendments regarding the interaction of IFRS 4 and IFRS 9. IFRS 9 Financial Instruments – Finalised version, incorporating requirements for classification and

measurement, impairment, general hedge accounting and derecognition. IFRS 9 Financial Instruments – Amendments regarding prepayment features with negative

compensation and modifications of financial liabilities. IFRS 10 Consolidated Financial Statements – Amendments regarding the sale or contribution of assets

between an investor and its associate or joint venture. IFRS 12 Disclosure of Interests in Other Entities – Amendments resulting from Annual Improvements

2014-2016 Cycle (clarifying scope). IFRS 15 Revenue from Contracts with Customers – Original Issue. IFRS 15 Revenue from Contracts with Customers – Clarifications to IFRS 15. IFRS 16 Leases – Original Issue. IFRS 17 Insurance Contracts – Original Issue. IFRIC 22 Foreign Currency Translations and Advance Consideration. IFRIC 23 Uncertainty over Income Tax Treatments.

The adoption of these standards and Interpretations are not expected to have a significant impact on the Company’s consolidated financial statements.

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3 Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been applied consistently to all periods presented in these financial statements and have been applied consistently by the Group entities, unless otherwise stated.

Consolidation

(a) Subsidiaries Subsidiaries are all entities over which the Group has power to govern the financial and operating

policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed as at the date of exchange, plus costs directly attributable to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in the consolidated statement of profit or loss.

Inter-company transactions, balances and unrealised gains on transactions between group companies are eliminated. Unrealised losses are also eliminated but are considered an impairment indicator of the asset transferred. Accounting policies of subsidiaries are consistent with the policies adopted by the Group.

(b) Joint ventures A joint venture exists where the Group has a contractual arrangement with one or more parties to

undertake activities typically, however not necessarily, through entities that are subject to joint control. The Group recognises interests in a jointly controlled entity using the equity method. The Group’s share of the results of joint ventures is based on financial statements made up to a date not earlier than three months before the date of the balance sheet. Intragroup gains on transactions are eliminated to the extent of the Group’s interest in the investee. Intragroup losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

(c) Loss of control On the loss of control, the Group derecognises the assets and liabilities of the subsidiary, any non-

controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in the statement of income. If the Group retains any interest in the previous subsidiary, then such interest is accounted for as an equity accounted investee or as an available-for-sale financial asset depending on the level of influence retained.

(d) Changes in ownership interests without change of control A change in the ownership interest of a subsidiary, without a loss of control, is accounted for as an

equity transaction.

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3 Summary of significant accounting policies (continued)

(e) Standards and amendments effective and relevant to the Company

Cash and cash equivalents Cash and cash equivalents in the statement of cash flows include cash in hand, bank overdraft and

deposits held with banks with a maturity of three months or less. Bank overdrafts are shown within borrowings in current liabilities on the consolidated statement of financial position.

Investments The Group classifies its investments as held-to-maturity financial assets. The classification depends on

the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and re-evaluates this designation at every reporting date.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest rate method, less provision for impairment. A provision for impairment of loans and receivables is established when there is objective evidence that the Group will not be able to collect all amounts due to it according to their original terms.

Regular way purchases and sales of investments are recognised on trade-date – the date on which the Group commits to purchase or sell the asset. Investments are initially recognised at fair value plus, in the case of all financial assets not carried at fair value through the consolidated statement of profit or loss, transaction costs that are directly attributable to their acquisition. Investments are derecognised when the rights to receive cash flows from the investment have expired or where they have been transferred and the Group has also transferred substantially all risks and rewards of ownership.

Trade receivables Trade receivables are recognised initially at transaction price, less any provision for impairment.

A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the provision is recognised in the consolidated statement of profit or loss.

Inventories Inventories, which are comprised of shipments of bananas in transit, bananas held in storage at a

ripening depot, bottled water, juices, condiments, ingredients, chemicals and packaging materials, are stated at the lower of cost and net realisable value. Cost for bananas is determined by reference to the invoiced price together with the delivery costs incurred in shipping the bananas to the United Kingdom and to a ripening depot. Cost for bottled water, juices, condiments, ingredients and chemicals are determined by reference to the invoice price, together with an allocated freight and service charge cost. Cost for packaging materials is determined using the weighted average basis. Net realisable value is the estimated selling price in the ordinary course of business less applicable variable selling expenses.

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Property, plant and equipment Land and buildings comprise warehouses and offices. All assets are stated at historical cost less

depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the consolidated statement of profit or loss during the financial period in which they are incurred. Increases in the carrying amount arising on revaluation of land and buildings are credited to other reserves in shareholder’s equity. Decreases that offset previous increases of the same asset are charged against other reserves directly in equity; all other decreases are charged to the consolidated statement of profit or loss. Each period, the difference between depreciation based on the revalued carrying amount of the asset charged to the consolidated statement of profit or loss and depreciation based on the asset’s original cost is transferred from “other reserves” to “retained earnings”.

Land is not depreciated. Depreciation on other assets is calculated using the straight-line and reducing balance methods to allocate their costs or revalued amounts to their residual values over their estimated useful lives, as follows:

Buildings – (straight-line) 2% Plant and machinery – (straight-line) 15% – 20% Office furniture and equipment – (straight-line and reducing balance) 25% – 33% Computer equipment – (straight-line) 25% – 33% Motor vehicles – (straight-line) 25%

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at each statement of financial position date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These are included in the consolidated statement of profit or loss.

Intangible fixed assets Intangible assets comprise trademarks and intellectual property.

Trademarks and intellectual property are carried at historical cost less amortisation. Amortisation is expensed in the statement of profit or loss on a straight-line basis over their estimated useful life of five years.

The Directors undertake an annual impairment review of the carrying value of the intangible assets with any impairment charged to the statement of profit or loss.

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Impairment of non-financial assets Assets that have an indefinite useful life, for example land, are not subject to amortisation and are tested

annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

Provisions Provisions are recognised when the Group has a present legal or constructive obligation as a result of

past events, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate of the amount can be made.

Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are

subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the consolidated statement of profit or loss over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the statement of financial position date.

Current income tax Current income tax assets and liabilities are measured at the amount expected to be recovered from or

paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantially enacted, at the reporting date in the countries where the Group operates and generates taxable income.

Current income tax relating to items recognised directly in equity is recognised in equity and not in the statement of profit or loss. Management periodically evaluates positions taken in the tax returns with respect to situations in which applicable tax regulations are subject to interpretation and establishes provisions where appropriate.

Deferred tax Deferred tax is provided in full, using the liability method, on temporary differences arising between the

tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that, at the time of the transaction, affects neither accounting nor taxable profit nor loss. Deferred tax is determined using tax rates (and laws) that have been enacted or substantially enacted by the balance sheet date and are expected to apply when the related deferred tax asset is realised or the deferred tax liability is settled.

Deferred tax is provided on temporary differences arising on investments in subsidiaries and associates, except where the timing of the reversal of the temporary difference is controlled by the Group and it is probable that the temporary difference will not reverse in the foreseeable future.

Share capital Ordinary shares are classified as equity. Preference shares, which have discretionary dividend obligations

and are not redeemable at a specific date or at the option of the shareholders, are also classified as equity.

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Dividend distribution Dividend distribution to the Group Company’s shareholders is recognised as a liability in the

Group’s consolidated financial statements in the period in which the dividends are approved by the Company’s shareholders.

Contributed capital Property, plant and equipment transferred and donated to the Group is included in property,

plant and equipment at cost or valuation, and the corresponding credit is recorded in a contributed capital reserve. This contributed capital reserve is amortised to retained earnings on a straight-line basis using the same rates used to provide depreciation on the applicable assets.

Leases Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor

are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the consolidated statement of profit or loss on a straight-line basis over the period of the lease.

Employee benefits

Pension obligations The subsidiary company, Winfresh (UK) Limited, is party to a multi-employer defined benefit pension

scheme. The actuaries of the scheme have confirmed to the directors that the company is unable to identify its share of the underlying assets and liabilities of the scheme on a reasonable consistent basis. Accordingly, there is insufficient information to use defined benefit accounting. In accordance with IAS 19 revised, the scheme is accounted for as if it were a defined contribution pension scheme. The contributions are recognised as employee benefit expense in the consolidated statement of profit or loss when they are due.

The subsidiary company, Winfresh (UK) Limited, also has a defined contribution pension scheme. A defined contribution pension scheme is a pension plan under which the company pays fixed contributions to a separate entity, typically being a pension fund, on a mandatory, contractual or voluntary basis. The subsidiary company has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. The contributions are recognised as employee benefit expense in the consolidated statement of profit or loss when they are due.

Revenue recognition Revenue comprises the fair value of the consideration received or receivable for the sale of goods and

services in the ordinary course of the Group’s activities. Revenue is recognised as follows: a. Banana trading Banana trading income (including fees, recoveries, sales and commissions) is recognised upon

delivery of products and customer acceptance. b. Interest income Interest income is recognised on a time-proportion basis using the effective interest method. c. Other income Other income is recognised on an accruals basis. d. Dividend income Dividend income is recognised when the right to receive payment is established.

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Foreign currency translation

a. Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates

prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities are recognised in the consolidated statement of profit or loss.

b. Group companies The results and financial position of all of the Group’s entities that have a functional currency different

from the presentational currency are translated into the presentational currency as follows:

(i) assets and liabilities for each balance sheet presented are translated at the closing rate at the date of that statement of financial position;

(ii) income and expenses for each statement of profit or loss are translated at the average exchange rates for the financial period (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the dates of the transactions); and

(iii) All resulting exchange differences are recognised as a separate component of equity.

On consolidation, exchange differences arising from the translation of the net investment in foreign operations are taken to shareholder’s equity. When a foreign operation is sold, exchange differences that were recorded in equity are recognised in the consolidated statement of profit or loss as part of the gain or loss on sale.

Comparatives Except when a standard or an interpretation permits or requires otherwise, all amounts are reported or

disclosed with comparative information.

4 Financial risk management

Financial risk factors The Group’s activities expose it to variety of financial risk: market risk (including currency risk and fair

value risk), credit risk, liquidity risk and cash flow interest rate risk. The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise the potential adverse effects on the Group’s financial performance.

Risk management The Directors are charged with the overall responsibility of establishing and monitoring the Group’s risk

management policies and processes. The Group’s overall risk management policies and processes focus on identifying, analysing and monitoring all potential risks such as foreign exchange risk, interest rate risk and credit risk that are faced by the Group. All treasury transactions are reported to and approved by the Directors.

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4 Financial risk management (continued)

a. Market risk

(i) Foreign exchange risk The Group trades internationally and is exposed to foreign exchange rate risk from various currency

exposures, primarily with respect to the US dollar and Sterling/UK pound (Stg). The exchange rate of the Eastern Caribbean dollar (EC$) to the United States dollar (US$) has been formally pegged at EC$2.70 = US$1.00 since July 1976. Foreign exchange risk arises when future commercial transactions or recognised assets or liabilities are nominated in a currency that is not the entity functional currency.

The Group purchases its bananas and fresh produce in foreign currency and forward currency contracts are occasionally used for the purchases. All costs denominated in foreign currency are settled using the spot rate. There were no outstanding forward currency contracts at the balance sheet date.

The following table summarises the Group’s exposure to foreign currency exchange rate risk at December 31, 2016.

EC$ $

US$ $

Stg $

Euro $

Total $

December 31, 2016

Financial assets

Loans and receivables

Cash and cash equivalents 126,690 78,875 5,507,023 1,642 5,714,230

Held-to-maturity financial assets 1,493,298 1,493,298

Trade and other receivables 5,279,537 36,849 19,203,051 24,519,437

Due from related parties 908,253 908,253

Government bond 7,147,394 7,147,394

Total financial assets 14,955,172 115,724 24,710,074 1,642 39,782,612

EC$ $

US$ $

Stg $

Euro $

Total $

Financial liabilities

Financial liabilities at amortised cost

Bank borrowings and overdrafts 6,669,560 15,670,029 22,339,589

Trade and other payables 5,264,666 6,317,605 18,622,586 19,222 5,714,230

Total financial liabilities 11,934,226 6,317,605 34,292,615 19,222 52,563,668

Net balance sheet financial position 3,020,946 (6,201,881) (9,582,541) (17,580) (12,781,056)

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a. Market risk (continued)

(i) Foreign exchange risk (continued)

At December 31, 2016 if the EC$ had weakened/strengthened by 10% against the Stg/UK pound with other variables held constant, post tax profit for the period would have been $570,940 (January 2, 2016 – $274,773) higher/lower, mainly as a result of foreign exchange gains/losses on translation of Stg/UK pound denominated transactions and loans due to related parties. The effect on retained earnings would have been $4,389,873 (January 2, 2016 – $5,137,100) higher/lower, mainly as a result of foreign exchange gains/losses on translation of Stg/UK pound denominated balances and loans due to related parties.

(ii) Cash flow and fair value interest rate risk The Company has interest bearing assets at fixed interest rates which expose the Company to fair value

interest rate risk. The Company has determined that the fair value interest rate risk was not significant at the statement of financial position date.

EC$ $

US$ $

Stg $

Euro $

Total $

January 2, 2016

Financial assets

Loans and receivables

Cash and cash equivalents 56,016 6,618,760 6,674,776

Held-to-maturity financial assets 1,437,194 1,437,194

Trade and other receivables 6,635,911 929,642 20,521,914 28,087,467

Due from related parties 908,253 908,253

Government bond 7,147,394 7,147,394

Total financial assets 16,184,768 929,642 27,140,674 44,255,084

EC$ $

US$ $

Stg $

Euro $

Total $

Financial liabilities

Financial liabilities at amortised cost

Bank borrowings and overdrafts 6,669,560 16,329,289 22,998,339

Trade and other payables 2,636,432 3,086,733 10,421,641 404,251 16,549,057

Total financial liabilities 9,305,482 3,086,733 26,750,930 404,251 39,547,396

Net balance sheet financial position 6,879,286 (2,157,091) 389,744 (404,251) 4,707,688

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WINFRESH LIMITED



b. Credit risk

Credit risk arises from cash and cash equivalents, deposits with banks and financial institutions and investments classified as loans and receivables; as well as credit exposure to customers, including trade receivables, balances due from related parties and committed transactions.

The Group manages its exposure to this risk by applying contractual terms that have been approved by the Directors to the amount of credit exposure to any one counterparty. It also employs strict minimum credit worthiness criteria as to the choice of counterparty, thereby ensuring that there is no significant concentration of credit risk.

The amount of the Group’s maximum exposure to credit risk is indicated by the carrying amount of its financial assets at the statement of financial position date. Management does not foresee any losses from non-performance by these counterparties as at December 31, 2016 and January 2, 2016.

The credit quality of trade receivable is summarised as follows:

The ageing of trade receivables that are impaired is as follows:

The impaired receivables mainly relate to customers who are in unexpectedly difficult economic positions. Management has reviewed the position and determined that a part of these receivables is not expected to be recovered.

Total other receivables as at the balance sheet date, which are expected to be recovered within one year, was $10,960,623 (as at January 2, 2016 – $8,777,634).

The maximum exposure to credit risk at the reporting date is the fair value of trade and other receivables mentioned above. The Group does not hold any collateral as security.

December 31 2016

$

January 2 2016

$

Neither past due nor impaired 13,347,031 15,968,741

Less than one month past due 2,660,187 2,771,491

One to two months past due 141,538 441,770

More than two months past due 1,873,016 1,455,042

18,021,772 20,637,044

December 31 2016

$

January 2 2016

$

More than two months past due 1,343,969 1,327,211

1,343,969 1,327,211

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WINFRESH LIMITED



a. Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and the ability of funding through

an adequate amount of committed credit facilities.

Bank overdrafts and trade and other payables are due within 12 months based on the remaining period at the statement of financial position date to the contractual maturity date.

The contractual undisclosed cash flows of the bank overdrafts and trade payables approximate the carrying amounts at the statement of financial position date as the impact of discounting is not significant.

b. Capital risk management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a

going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders or return capital to shareholders.

5 Determination of fair values

A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. Where applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

Property, plant and equipment The fair value of property, plant and equipment recognised as a result of a business combination is the

estimated amount for which a property could be exchanged on the date of acquisition between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had acted knowledgeably. The fair value of items of plant, equipment, fixtures and fittings is based on the market approach and cost approaches using quoted market prices for similar items when available and replacement cost when appropriate. Depreciation replacement cost estimates reflect adjustments for physical deterioration as well as functional and economic obsolescence.

Trade and other receivables The fair values of trade and other receivables approximate their carrying amounts due to the short term

nature of the related transactions.

Cash and cash equivalent Due to the short term nature of the transactions, the fair values of cash and cash equivalents approximate

their carrying amounts at the reporting date.

Trade and other payables Due to the short term nature of the related transactions, the fair values and other payables approximate their

carrying amounts at the reporting date.

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6 Revenue

Revenue represents the sale of goods. Revenue arises in:

7 Finance costs

8 Other (losses)/gains, net


WINFRESH LIMITED


Period ended December 31, 2016

$

Period ended January 2, 2016

$

Sales of goods 193,482,062 207,756,424


$


$

Caribbean 4,522,108 2,634,513

United Kingdom 188,959,954 205,121,911


$


$

On bank loans and overdrafts 1,080,291 1,223,910

Other interest 27,788

1,108,079 1,223,910


$


$

Deposit forfeited on abortive purchase of property (100,000)

Foreign exchange gains

Realised (losses)/gains on transactions (2,615,158) 890,750

Gains on disposal of property, plant and equipment 34,209 34,284

Provision against investment in joint venture (330,035)

(3,010,984) 925,034

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9 Other income

10 Income tax expense

The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the applicable standard rate as follows:


WINFRESH LIMITED



$


$

Bank interest 35,719 64,509

Other interest 2,779 12,568

Interest on loan due from Government of Saint Lucia 2,708,019

Interest from government bond 389,484 253,781

Miscellaneous income 328,823 340,852

756,805 3,379,729


$


$

Current tax 731,374 777,719

Current tax charge 731,374 777,719

Adjustment in respect of prior period (53,724) (18,423)

Share of joint venture deferred tax 1,131,785 346,459

Deferred tax charge (note 23) 6,751 (269,269)

Total tax charge 1,816,186 836,486


$


$

Profit before income tax 49,053 6,720,239

Tax calculated at standard rate of 30% 14,716 2,016,072

Lower rate taxes for foreign subsidiary (341,480) (196,123)

Exempt profit (1,593,813) (2,675,216)

Expenses not deductible for tax purposes 38,106 818,041

Tax losses utilised (50,492)

Deferred tax not recognised 1,138,536 (289,892)

Other tax adjustments 2,580,121 1,214,096

Tax charge 1,836,186 836,486

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11 Cash and cash equivalents

12 Held-to-maturity financial assets

13 Trade and other receivables


WINFRESH LIMITED


December 31, 2016 $

January 2, 2016 $

Cash at bank and in hand 5,714,230 6,674,776

December 31, 2016 $

January 2, 2016 $

Term deposits 1,493,298 1,437,194

December 31, 2016 $

January 2, 2016 $

Trade receivables 18,021,772 20,637,044

Less: Provision for impairment of trade receivables (note 14) (1,343,969) (1,327,211)

Total trade receivables – net 16,677,803 19,309,833

Other receivables 4,982,479 8,777,634

Prepayments 2,692,636 1,275,336

24,352,918 29,362,803

For the purpose of the consolidated statement of cash flows, cash and cash equivalents comprise the following:

Held-to-maturity financial assets comprise term deposits with banks. The effective interest rates on term deposits are 2%, 4% and 3.75% (January 2, 2016 – 4% and 3.75%) per annum. Term deposits mature within one year.

December 31, 2016 $

January 2, 2016 $

Cash at bank and in hand 5,714,230 6,674,776

Bank overdrafts (note 24) (2,016,897) (1,523,883)

3,697,333 5,150,893

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14 Provision for impairment of trade receivables

15 Inventories

16 Related party transactions and balances


WINFRESH LIMITED


December 31, 2016 $

January 2, 2016 $

At beginning of period 1,327,211 1,327,211

Provision 16,758

At end of period 1,343,969 1,327,211

December 31, 2016 $

January 2, 2016 $

Raw materials 212,775 83,379

Chemicals and additives 79,120 1,019,676

Packaging materials 1,060,982 684,632

Finished goods 7,681,935 9,032,590

9,034,812 10,820,277

December 31, 2016 $

January 2, 2016 $

Purchase of goods and services

Purchase of bananas from BGAs 12,872,373 15,290,977

The movement in the provision for impairment of receivables is as follows:

The creation and release of the provision for impaired receivables has been included in general and administrative expenses in the consolidated statement of profit or loss. Amounts charged to the allowance account are generally written off, when there is no expectation of recovering additional cash.

The Group is related to the banana grower associations (BGAs), agricultural companies and the Governments of the Windward Islands (Note 1), which together own 100% of the Company’s shares. At the statement of financial position date the Group owns 50% of Windward Isles Banana Company Holdings (Jersey) Limited and 50% of Windward Isles Banana Company (UK) Limited.

The following transactions were carried out with the above mentioned related parties:

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16 Related party transactions and balances (continued)

17 Other receivables


WINFRESH LIMITED


December 31, 2016 $

January 2, 2016 $

Key management compensation:

Salaries and other short-term benefits 3,290,800 3,618,008

December 31, 2016 $

January 2, 2016 $

Prepayments and accrued income 166,519 51,015

December 31, 2016 $

January 2, 2016 $

Due from related parties

Non-current

Grenada Banana Co-Operative Society 786,780 786,780

Dominica Banana Marketing Corporation 121,473 121,473

908,253 908,253

At the statement of financial position date the following amounts were due from related parties stated:

Balances with related parties are unsecured, non-interest bearing and have no fixed terms of repayment other than they are due in no less than one year.

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18 Intangible fixed assets


WINFRESH LIMITED


Trademarks $

Intellectual property $

Total $

Cost

At December 28, 2014 4 104,541 104,545

Exchange difference (5,230) (5,230)

At January 2, 2016 4 99,311 99,315

At January 3, 2016 4 99,311 99,315


At December 31, 2016 4 82,922 82,926

Amortisation

At December 28, 2014 20,909 20,909

Exchange differences (1,806) (1,806)

Charge for the period 20,623 20,623

At January 2, 2016 39,726 39,726

At January 3, 2016 39,726 39,726

Exchange differences (7,993) (7,993)

Charge for the period 18,022 18,022

At December 31, 2016 49,755 49,755

Net book value

Net book value at December 31, 2016 4 33,167 33,171

Net book value at January 2, 2016 4 59,585 59,589

Net book value at December 27, 2014 4 83,632 83,636

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19 Property, plant and equipment


WINFRESH LIMITED


Leasehold improvements

$

Land and buildings

$

Plant and machinery

$

Office furniture and equipment

$

Computer equipment

$

Motor vehicles

$

Total

$

Cost

Balance at December 28, 2014 7,877 36,608,947 16,724,672 7,020,362 2,883,377 1,209,686 64,454,921

Exchange differences (1,249,347) (247,452) (276,370) (64,048) (25,968) (1,863,185)

Additions 971,860 665,549 99,184 207,413 21,482 1,965,488

Disposals (1,577,906) (72,873) (421,146) (2,302) (195,090) (2,269,317)

Balance at January 2, 2016 7,877 34,753,554 17,069,896 6,422,030 3,024,440 1,010,110 62,287,907

Balance at January 3, 2016 7,877 34,753,554 17,069,896 6,422,030 3,024,440 1,010,110 62,287,907

Exchange differences (3,915,255) (775,475) (863,449) (230,543) (60,368) (5,845,090)

Additions 887,546 5,964,804 76,477 187,435 105,049 7,221,311

Transfer from other investments 2,654,000 2,654,000

Disposals (7,877) (8,672) (3,886) (157,026) (177,461)

Balance at December 31, 2016 34,379,845 22,259,225 5,626,386 2,977,446 897,765 66,140,667

Depreciation

Balance at December 28, 2014 7,877 3,322,175 12,439,909 6,166,569 2,621,112 985,753 25,543,395

Exchange differences (124,265) (237,926) (248,993) (60,106) (24,642) (695,932)

On disposals (190,359) (72,369) (420,709) (1,279) (174,640) (859,356)

Charge for the period 610,250 1,634,552 323,085 210,448 74,613 2,852,948

Balance at January 2, 2016 7,877 3,617,801 13,764,166 5,819,952 2,770,175 861,084 26,841,055

Balance at January 3, 2016 7,877 3,617,801 13,764,166 5,819,952 2,770,175 861,084 26,841,055

Exchange differences (433,727) (763,974) (788,152) (206,414) (60,460) (2,252,727)

On disposals (7,877) (8,607) (970) (157,026) (174,480)

Charge for the period 574,184 1,423,154 223,398 179,342 99,198 2,499,276

Balance at December 31, 2016 3,758,258 14,423,346 5,246,591 2,742,133 742,796 26,913,124

Net book value

Net book value at Dec 31, 2016 30,621,587 7,835,879 379,795 235,313 154,969 39,227,543

Net book value at Jan 2, 2016 31,135,753 3,305,730 602,078 254,265 149,026 35,446,852

Net book value at Dec 27, 2014 33,286,772 4,284,763 853,793 262,265 223,933 38,911,526

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20 Investments in joint ventures


WINFRESH LIMITED


The Group has a 50% interest in Windward Isles Banana Company (UK) Limited (“WIBUK”) and Windward Isles Banana Company Holdings (Jersey) Limited (“WIBJ”). WIBUK and WIBJ are incorporated in the United Kingdom and Jersey respectively, on a 50% joint-venture basis with Fyffes Plc for the acquisition of the banana operating division of the Geest Group of Companies.

The principal activities of WIBUK were that of operating cargo ships between the United Kingdom, mainland Europe and the Caribbean. The WIBUK group also provides related services to freight customers and third parties.

The principal activities of WIBJ were that of an investment company.

During the period, on December 8, 2016 the company acquired 1 ordinary share of £1 in Geest Line Limited (previously Geest Shipping Limited), on a 50% joint venture basis with Fyffes Plc, for a cash consideration of £1.

Summarised financial statements of the joint ventures, based on their financial statements prepared in accordance with International Financial Reporting standards as adopted by the European Union and reconciliation with the carrying amount of the investment in consolidated financial statements are set out below:

The joint ventures had no contingent liabilities or capital commitments as at December 31, 2016 and January 2, 2016.

Subsequent to the balance sheet the group disposed of its investment in Windward Isles Banana Company (UK) Limited (see events after the reporting period). Consequently, a provision of $330,035 has been made against this investment (note 8) to write its carrying amount to its recoverable value.

Geest Line Limited (formely Geest Shipping Limited WIBUK Limited WIBJ Limited

Dec 31, 2016 $

Jan 2, 2016 $

Dec 31, 2016 $

Jan 2, 2016 $

Dec 31, 2016 $

Jan 2, 2016 $

Balance sheet

Current assets 7 8 78,267,932 66,342,420 4,096,495 3,162,190

Non-current assets 26,466,343 50,662,568 9,154,920 10,964,376

Current liabilities (104,074,192) (87,305,830) (1,651,866) (1,779,725)

Non-current liabilities (33,492,991)

Equity 7 8 660,083 (3,793,833) 11,599,549 12,346,841

Group carrying amount at beginning of period (1,896,917) 639,815 6,364,147 6,943,397

Additions 3

Share of profits/(loss) 5,430,044 (1,668,369) 701,057 (243,347)

Share of tax (1,131,785) (346,460)

Share of actuarial losses (2,220,317) (585,682)

Exchange difference 149,017 63,779 (1,051,540) (335,903)

Provisions (330,035)

Group carrying amount of the investments 3 7 (1,896,917) 6,013,666 6,364,147

Dec 31, 2016 $

Jan 2, 2016 $

Group total carrying amount of the investments 6,013,676 4,467,230

Current assets include:

Cash and cash equivalent 27,464,760 36,937,235 2,378,289 3,146,299

Prepayments 12,588,015 9,113,144

Current liabilities include:

Tax payable of

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Geest Line Limited (formely Geest Shipping Limited WIBUK Limited WIBJ Limited

Period ended Dec 31, 2016

$

Period ended Jan 2, 2016

$


$


$


$


$

Summarised statement of profit or loss

Revenue 193,719,015 200,039,220

Cost of sales (172,189,875) (177,271,870)

Other operating income 118,946 251,596

Selling and distribution expenses (2,454,603) (2,841,794)

Administrative expenses (6,001,343) (9,973,089) (125,154) (98,989)

Share of joint venture losses (420,701)

Provision against joint venture losses (209,056)

Release of provision against short term bond 1,802,205

Finance costs (2,472,625) (2,940,783)

Finance income 140,572 148,483 21,626 20,623

Goodwill impairment (6,826,081)

Initial recognition of benefit liability (3,922,419)

Profit/(loss) before tax 10,860,087 (3,336,737) 1,489,621 (499,067)

Income tax expense (2,263,569) (692,919)

Profit/(loss) for the period 8,596,518 (4,029,656) 1,489,621 (499,067)

Other comprehensive loss (4,440,633) (1,171,364) (86,506) (28,872)

Total comprehensive profit/(loss) for the period 4,155,885 (5,201,020) 1,403,115 (527,939)

Share of profit/(loss) for the period 2,077,942 (2,600,510) 701,057 (257,425)

Summary of share of loss:

Share of profit/(loss) before taxation 5,430,044 (1,668,369) 744,310 (243,347)

Share of taxation (1,131,785) (346,459)

Share of other comprehensive loss (2,220,317) (585,682) (43,253) (14,078)

Share of profit/(loss) for the period 2,077,942 (2,600,510) 701,057 (257,425)

Total Period ended Dec 31, 2016

$

Total Period ended

Jan 2, 2016 $

Summary of Group’s share of loss:

Group’s share of profit/(loss) before taxation 6,131,101 (1,911,716)

Group’s share of taxation (1,131,785) (346,459)

Group’s share of other comprehensive loss (2,220,317) (599,760)

Group’s share of loss for the period 2,778,999 (2,857,935)

Administrative expenses include:

Depreciation of 3,067,353 2,862,417

Finance costs include interest expense of 2,332,053 965,138

20 Investments in joint ventures (continued)


WINFRESH LIMITED


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20 Investments in joint ventures (continued)

21 Investments in Government Bond

22 Other investments


WINFRESH LIMITED


Geest Line Limited was dormant throughout the current and previous financial periods.

On May 2, 2017 Directors of Windward Isles Banana Company (UK) Limited (“WIBUK”) passed a special resolution to wind up the company voluntarily and therefore did not produce or file any consolidated financial statements for the period ended December 31, 2016. The above WIBUK results were derived from WIB (UK) consolidated management accounts for the period ended December 31, 2016.

Subsequent to the balance sheet the group disposed of its investment in Windward Isles Banana Company (UK) Limited (see events after the reporting period on note 33).

On June 1, 2015 the Government of Saint Lucia issued a 5 year Fixed Rate Bond to the value of $7,147,394. The bond bears interest rate of 6% per annum and matures on June 1, 2020.

Vincyfresh Limited, one of the Group companies, invested in a property valued at $2,654,000 located at Diamond to operate a snack food factory. On February 28, 2011 Vincyfresh Crisps Ltd was incorporated and on March 18, 2011 the property was registered as being owned by Vincyfresh Crisps Ltd. Vincyfresh Crisps Ltd is a 100% owned subsidiary of Vincyfresh Limited. Vincyfresh Crisps Ltd has not traded since its incorporation. Ownership of this property was transferred to Vincyfresh Limited on December 29, 2016 and was included as part of the Company’s property, plant and equipment.

December 31, 2016 $

January 2, 2016 $

At beginning of period 7,147,394

Additions 7,147,394

At end of period 7,147,394 7,147,394

December 31, 2016 $

January 2, 2016 $

At beginning of period 2,654,000 2,654,000

Transfer to property, plant and equipment (2,654,000)

At end of period 2,654,000

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Deferred income taxes are calculated in full on temporary differences under the liability method using a principal tax rate of 20% (January 2, 2016 – 20%). The movement on the deferred tax asset account is as follows:

Deferred tax asset is made up as follows:

December 31, 2016 $

January 2, 2016 $

At beginning of period 573,099 330,270

Consolidated statement of income charge (note 10) (6,751) 269,269


At end of period 472,308 573,099

December 31, 2016 $

January 2, 2016 $

Amounts falling due within one year:

Bank overdrafts 2,016,897 1,523,883

Bank loans 16,342,292 15,912,816

18,359,189 17,436,699

Amounts falling due after one year:

Bank loans 3,980,400 5,561,640

Other loans 500,000

3,980,400 6,061,640

Analysis of loans

Wholly repayable within five years 20,322,692 21,974,456

Included in current liabilities (16,342,292) (15,912,816)

3,980,400 6,061,640

December 31, 2016 $

January 2, 2016 $

Decelerated capital allowances 248,954 353,152

General provision for pension contribution and accrued holiday pay

223,354 219,947

472,308 573,099

23 Deferred income tax asset

24 Loans and borrowings


WINFRESH LIMITED


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24 Loans and borrowings (continued)

25 Trade and other payables

26 Share capital


WINFRESH LIMITED


December 31, 2016 $

January 2, 2016 $

Loan maturity analysis

In more than one year but not more than two years 663,400 500,000

In more than two years but not more than five years 3,317,000 5,561,640

3,980,400 6,061,640

December 31, 2016 $

January 2, 2016 $

Trade payables 18,796,931 14,871,657

Other payables 1,657,988 1,177,401

Accrued expenses 9,769,160 11,397,220

30,224,079 27,446,278

December 31, 2016 $

January 2, 2016 $

Subscribed

5,000 ordinary shares of $1,000 each 5,000,000 5,000,000

1,500 5% non-cumulative preference shares of $10,000 each

15,000,000 15,000,000

20,000,000 20,000,000

The aggregate amount of loans and borrowings for which security has been given amounted to $21,260,846 (January 2, 2016 – $22,475,638), which are secured by way of a debenture over the subsidiary companies’ long leasehold property and improvements, freehold land and buildings and equipment, and guarantees given the ultimate parent company.

Bank loan of $4,643,800 bears interest at LIBOR plus 2.75%; bank loan of $11,026,228 bears interest at 2.75%, and bank loan of $5,590,818 bears interest at 8.5% per annum. Other loan of $500,000 is unsecured, and bears interest of 5%.

Only the ordinary shares have voting rights. However, in the event of a winding up of the Company the 5% Non-Cumulative Preference Shareholders have a priority over the ordinary shareholders in respect of asset of the Company remaining after payment of its debts, liabilities and all costs relating to winding up. Such assets of the Company that remained after this would be distributed amongst the holders of the Non-Cumulative Preference Shares and the Ordinary Shares in proportion to the amounts paid up or credited as paid up on the shares held by them.

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$


$

Direct costs 177,028,003 181,355,828

Salaries and wages 11,080,040 11,324,680

Directors’ fees 1,285,711 1,454,812

Rent and service charges 375,507 391,753

Insurance 259,904 263,905

Light and heat 268,797 297,495

Repairs and renewals 319,132 283,456

Security 14,170 9,362

Printing, postage and stationery 59,384 58,250

Advertising and publicity 650,159 318,593

Telephone 197,002 194,941

Information technology support costs 902,032 327,866

Vehicle expenses 75,147 66,404

Travel and entertaining 737,181 741,468

Subsistence 261,272 170,813

Legal and professional fees 818,187 641,030

Audit fees 448,865 506,302

Bank charges 240,998 247,949

Bad debt expenses 4,184 8,641

Other expenses 232,703 248,403

Subscriptions and donations 26,850 82,876

Research and development 488,687 296,607

Provision against related party debt 40,317

Depreciation and amortisation 2,517,298 2,873,571

Total cost of goods sold, administrative and General expenses 198,291,213 202,205,322

Cost of goods sold 175,937,081 180,143,378

Distribution and selling expenses 9,857,335 10,810,496

Administrative and general expenses 12,496,797 11,251,448

Total cost of goods sold, administrative and General expenses 198,291,213 202,205,322

27 Expenses by nature


WINFRESH LIMITED


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28 Employee benefit expenses

29 Financial commitments

30 Capital commitments

31 Pension


WINFRESH LIMITED



$


$

Salaries and wages 9,588,772 9,982,978

Directors’ fees 1,285,711 1,454,812

Social security costs 789,321 865,202

Other staff costs 701,947 476,500

12,365,751 12,779,492

Land and buildings

December 31, 2016 $

January 2, 2016 $

Within one year 204,000 204,000

Between two and five years 325,000 451,500

529,000 655,500

Land and buildings

December 31, 2016 $

January 2, 2016 $

Commitments for the acquisition of land 1,876,771

At December 31, 2016 the Group had lease payments due under operating leases as follows:

At December 31, 2016 the Group had capital commitments as follows:

The subsidiary company, Winfresh (UK) Limited, is party to a multi-employer defined benefit pension scheme and the scheme’s actuaries have confirmed to the Directors that they are unable to supply the trustees of the pension scheme with any allocation of the pension scheme’s assets and liabilities between the pension scheme’s participating employers on a reasonably consistent basis. Consequently, in accordance with International Accounting Standard No. 19 (IAS 19) the scheme has been accounted for as if it were a defined contribution pension scheme.

Subsequent to the balance sheet date the commitments to acquire the land has become abortive.

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31 Pension costs (continued)

32 Guarantees

33 Contingent liabilities


WINFRESH LIMITED


The constitution of the scheme requires that a triennial valuation is performed by independent actuaries and the last such valuation was performed at December 31, 2015. As part of this valuation the trustees had previously produced a Statement of Funding Principles [SFP] in August 2014, which sets out the trustees’ policy for ensuring that the scheme’s statutory funding objective is met. The valuation performed at December 31, 2015 revealed that, on the SFP basis, there was a funding deficit of $6,624,049 in the scheme at that date [previous triennial valuation at December 31, 2012 – a funding deficit of $14,585,332 at that date when restated to the SFP basis]. In each case the funding level was less than the 90% required by the minimum funding requirement rules.

The trustees have determined to keep the pension fund’s investment strategy under close review and the participating employers have determined that they will do all that they can to preserve accrued entitlements within the scheme via an agreed schedule of revised employer contributions. The participating employers are currently in discussion regarding further steps that may be taken to address the deficit in the scheme.

The assets of the scheme are held separately from those of the subsidiary company in an independently administered fund. The pension cost charge in the consolidated statement of profit or loss represents contributions payable by the subsidiary company to the fund for the period amounted to $418,868 (period to January 2, 2016 – $174,405). Contributions $163,555 were payable to the fund at the statement of financial position date (at January 2, 2016 – $20,411).

Defined contribution pension scheme

The subsidiary company, Winfresh (UK) Limited, operates a defined contribution pension scheme. The assets of the scheme are held separately from those of the Group in an independently administered fund. The pension cost charge represents contributions payable by the subsidiary company to the fund and amounted to $265,097 (January 2, 2016 – $427,313). Contributions totalling $36,978 (January 2, 2016 – $40,203) were payable to the fund at the statement of financial position date and are included in other payables.

The subsidiary company, Winfresh (UK) Limited, has provided a payment guarantee to the UK tax authority, HM Revenue & Customs. At the balance sheet date the maximum amount payable under this payment guarantee totalled $829,250 (January 2, 2016 – $993,150).

33.1 The Group is contingently liable in respect of disputed liabilities that may be due under the banana contract sales agreement with the banana companies. These amounts are currently being negotiated and the full amount of the liability, if any, cannot be determined at the balance sheet date. Any settlements arising from these disputed liabilities are expected to be accounted for as a charge against income in the period in which the settlement occurs.

33.2 The subsidiary company, Winfresh (UK) Limited has entered into a recovery plan designed to restore the minimum funding level of the defined benefit pension scheme of which it is one of the participating employers, by way of a schedule of revised employer contributions. At the currently agreed level of contribution the Company is liable to make a total employer’s contribution of $163,555 for the period to December 31, 2016 (January 2, 2016 – $454,355 for the next four years to December 31, 2020).

Provision has been made in these financial statements in respect of this future liability.

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34 Events after the reporting period


WINFRESH LIMITED


On January 1, 2017 Geest Line Limited (formerly Geest Shipping Limited), a dormant company in which the Group has a 50% interest, issued 499,998 shares of £1 each at par, 249,999 to Winfresh Limited and 249,999 to Fyffes Group Limited.

On January 1, 2017 Geest Line Limited (formerly Geest Shipping Limited) acquired Geest Shipping Limited (formerly Geest Line Limited) for $43,121,000 (£13,000,000). Geest Shipping Limited (formerly Geest Line Limited), a company engaged in the operation reefer cargo ships between the UK, mainland Europe and the Caribbean transporting goods both Eastbound and Westbound, was a subsidiary of Windward Isles Banana Company (UK) Limited, a company in which the Group had a 50% interest.

On the same day, Geest Shipping Limited (formerly Geest Line Limited) acquired the shares of Windward Isles Banana Company (UK) Limited for $13 (£4) from Winfresh Limited and its joint venture partner Fyffes Group Limited.

On May 2, 2017 liquidators were appointed to Windward Isles Banana Company (UK) Limited for a voluntary winding up.

Winfresh Limited

INVESTING IN OUR FUTURE - Winfresh...5 INVESTING IN OUR FUTURE REGISTERED ADDRESSES WINFRESH LIMITED...

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