annual report 2010[1]wilderness

8/3/2019 Annual Report 2010[1]Wilderness

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CONTENTS

We are in the businessof building sustainable

conservation economies

ABOUT THIS REPORT

Financial highlights 1

Group at a glance 2

Our business 3Board of directors 4

Chairmans report 8

Chief Executive Officers report 10

Corporate governance 12

Sustainability report 16

Annual financial statements contents 20

Wilderness Holdings Pro forma Consolidated

Financial Information 21

Group and Company accounting policies 30

Wilderness Holdings Limited

annual financial statements 41

Wilderness Safaris Investment andFinance (Proprietary) Limited

annual financial statements 81

Notice of annual general meeting 115

Form of proxy Inserted

Corporate information Inside back cover

This annual report provides an overview of key highlights

and Company performance throughout the year. It

includes a review of the years activities and business

performance from the Chairman and CEO. It also contains

the Groups Corporate Governance report, Sustainability

report, Consolidated Pro Forma Group results and the

audited accounts of Wilderness Holdings Limited and

Wilderness Safaris Investment and Finance (Pty) Limited.

The Company was listed on the Botswana Stock Exchange

and the Africa Board of the JSE Limited as a secondary

listing on 8 April 2010. Simultaneously the Company

was restructured and, as a result, Wilderness Safaris

Investment and Finance (Pty) Limited became a wholly

owned subsidiary of Wilderness Holdings Limited. The

pro forma consolidated financial results have been

prepared to illustrate the effect of the restructuring as if

the transaction occurred on 1 March 2009 and should be

reviewed in conjunction with the independent reporting

accountants report thereon.

ANNUAL REPORT2010

w w w . w i l d e r n e s s - g r o u p . c o m


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Wilderness Holdings Limited Annual Report 2010 1

PRO FORMA FINANCIAL HIGHLIGHTS

EBITDA up 9% on 2009 and 18% against forecast

GP% up from44% to 48%

Normalised fixed costs down 13%

Cash generation from operations P131 million, net cash position at

year end P64 million

PAT up from loss of P5 million to profit ofP48 million

Revenue P868 million, down12% on 2009 and 8% against forecast

HEPS 20.44* thebe per share

0

200 000

400 000

600 000

800 000

1 000 000

1 200 000

1110090807

0

30 000

60 000

90 000

120 000

150 000

1110090807

0

50

10 0

15 0

20 0

1110090807

Revenue bridge

(Pm)

Operating profit bridge

(Pm)

Headline earnings per share

(thebe)

*Based on 231 000 000 shares in issue as at 8 April 2010


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Wilderness Holdings Limited Annual Report 20102

South Africa

Botswana

Zimbabwe

Malawi

Zambia

Namibia

GROUP AT A GLANCE

AFRICAN FOOTPRINT

Our business has influence over7,1 million acres of land, in 8 of11biomes

in southern Africa, located in 7 countries operating and/or marketing73 destinations underthree brands.

Botswana

Kings Pool

DumaTau

Savuti

Little Vumbura

Vumbura Plains

Duba Plains

Mombo

Little Mombo

Baobab Safari Lodge

Baobab Camp

Xigera

Xigera Mokoro Trails

Chitabe

Chitabe LedibaWilderness Tented Camp

Moremi Tented Camp

Kwetsani

Jao

Jacana

Tubu Tree

Abu Camp

Seba

Selinda

Zarafa

Kalahari PlainsLinyanti Adventurer

Linyanti Discoverer

Khwai Adventurer

Khwai Discoverer

Selinda Canoe Trail

Namibia

Little Kulala

Kulala Wilderness Camp

Kulala Desert Lodge

Doro Nawas

Damaraland Camp

Desert Rhino Camp

Palmwag Lodge

Skeleton Coast Camp

Serra Cafema

Anderssons

Little Ongava

Ongava Lodge

Ongava Tented Camp

LianshuluLianshulu Bush Lodge

Desert Homestead

Skeleton Coast Research Camp

MalawiMvuu Wilderness Lodge

Mvuu Camp

Mumbo Island Camp

Chintheche Inn

Chelinda Lodge

Chelinda Camp

Seychelles

North Island

South Africa

Pafuri Camp

Pafuri Walking Trail

Rocktail Beach Camp

Zambia

Busanga Bush Camp

Shumba

Kapinga

Lufupa River Camp

Lufupa Tented Camp

River Club

Toka Leya

Kalamu Star-bed Camp

Kalamu Lagoon Camp

Chinengwe River-bed Camp

Zimbabwe

Makalolo Plains

Little Makalolo

Davisons

Ruckomechi

Linkwasha

Mana Canoe Trail

Seychelles


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OUR BUSINESS

WHAT DO WE DO? HOW DO WE DO IT? WHY DO WE DO IT?

In our TOURISM operation:

In our CONSERVATION operation:

In ourAWARENESS initiative:

to build a thriving, successfulbusiness

we believe that doing

good creates value for the

business

we aim to be positioned as

the leader in sustainable

tourism

we offer journeys andexperiences for globally caring

travellers

we conserve biodiversity and

carbon sinks and engage

community partners

we present Wilderness both

internally and externally

through vertically integrated productofferings;

through relationship-basedmarket strategies;

through service-orientated salesprogrammes

through caring for, educating andempowering people;

through investing in technologies to

ensure our operational sustainability;

through inventory research, relocationand rehabilitation to improve biodiversityconservation

as a thriving, successful business;

as a business which believes that doinggood creates value for our stakeholders;

as a business that is prepared to share itslearnings

We are in the business

of building sustainableconservation economies

all with thevision of making a difference to peoples lives, by enabling them to

find new paths, and leaving a legacy of conservation for our children

as we believe the

worlds wilderness areaswill save humankind

Through experience

based tourism

we show

Through our

conservation efforts

we care

Through build ing

awareness

we share


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BOARD OF DIRECTORS

EXECUTIVE DIRECTORS

Russel Friedman (58)Executive DirectorAppointed: 8 April 2010

Russel joined and became a director of Wilderness Groupcompanies in 1984. During this time he owned and manageda natural history mail order bookshop and publishing house.Russel was a founding member of the Vulture Study Group andhas continued to develop his natural history interests while at thesame time being an integral part of the Wilderness managementteam. Russel is a member of the Executive Committee of

Wilderness Safaris and is responsible for North Americaninternational marketing, insurance and the ecological andconservation divisions within Wilderness. He is a trustee of theWilderness Safaris Wildlife Trust.

Derek de la Harpe (50)Chief Financial Officer anda member of the Risk andSustainability CommitteesAppointed: 8 April 2010

Derek is a Chartered Accountant (Zimbabwe) with thirty yearsexperience in southern and eastern Africa. He spent eighteenyears with the then Price Waterhouse, the last eight as thepartner in charge of the firms practice specialising in tourism andenvironmental consulting. He then spent eight years as the CEOof The Malilangwe Trust, a Zimbabwean NGO working in wildlifeconservation and rural development, and with a high profiletourism operation. He has spent the last four years workingas a management consultant in southern and eastern Africa,south-east Asia and central America, specialising in the tourismdevelopment and wildlife conservation interface.

Andrew Payne (45)Chief Executive Officer anda member of the Risk andSustainability CommitteesAppointed: 8 April 2010

Andy was educated at the University of Cape Town where hequalified as a Chartered Accountant. He joined Wilderness in1994 after having worked with the Company in Botswana forthe previous year. When Andy joined the Company, his role wasto grow Wilderness in southern Africa. This transformation sawWilderness move from primarily being a company focused onexploration-orientated trips to one which was more focused onvertically-integrated operations, owning booking offices, transfercompanies and camps. Andy took over from Malcolm McCullochas CEO of Wilderness in 2007.

David van Smeerdijk

(45)Sales and MarketingDirectorAppointed: 8 April 2010

David has a Bachelor of Economics and an MBA through theMaastricht School of Management (Netherlands). David startedworking in Australia for a travel company in sales, and has workedfor over 20 years in the safari and travel industry. He joinedWilderness in 1992, spent seven years in Botswana as guideand general manager, moving to Namibia in 1999 to take up theposition of managing director of Wilderness Safaris Namibia. In

late 2006 he took up the position of Sales and Marketing Directorof Wilderness.

Keith Vincent (47)Chief Operations DirectorAppointed: 18 August 2005

Keith was educated in Zimbabwe, where he developed a love for the outdoors and natural history

of the country. He became a professional guide, working throughout the country for various safaricompanies, before settling in Victoria Falls in 1984. Keith has been in the safari industry since 1980,working throughout southern Africa, and is currently the Vice Chairman of the Botswana TourismBoard. Keith has been involved with the Wilderness Group since 1993.


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NON-EXECUTIVE DIRECTORS

John Gnodde (45)Independent Non-executiveDirectorAppointed: 8 April 2010

John became a director of Wilderness Safaris Investment and Finance(Pty) Limited in March 2005. He is an executive director of Brait andCEO of Braits private equity business. He has overall responsibility forBraits private equity funds, having previously led the managementof each of Brait I, Brait II and Brait III. John joined Brait in 1995 andhas been responsible for investments in consumer products,construction, pharmaceutical manufacture, beverages, resources,mobile telecommunications and recruitment outsourcing, amongothers. He has been a non-executive director of over 20 companies,listed and unlisted. Prior to joining Brait, John worked for GoldmanSachs International in London for six years where he served in theinvestment banking division. He is a graduate of the University ofCape Town where he completed a degree in commerce.

Rolf Hartmann (36)Independent Non-executive

Director, Chairman ofthe Audit and the RiskCommittees and a memberof the Remuneration andNomination CommitteeAppointed: 8 April 2010

Rolf became a director of Wilderness Safaris Investment and Finance(Pty) Limited in January 2007. He is a director of Braits private equitybusiness. Rolf joined Brait in 2003 and his current responsibilitiesinclude transaction execution and support activities with executiveresponsibility for investments in tourism and food processing,among other matters. He is a non-executive director of Kelly GroupLimited, a company listed on the JSE, as well as several unlisted

companies. Rolf is a Chartered Accountant, and previously workedin corporate finance in London, after qualifying at Deloitte. Rolf is agraduate of the University of the Witwatersrand where he completeda Bachelor of Commerce (Honours) degree.

John Hunt (55)Independent Non-executiveDirector and a member of theSustainability CommitteeAppointed: 8 April 2010

John co-founded the advertising group Hunt Lascaris in 1983.In 1996, a majority share was sold to TBWA and he becameco-Chairman. In 2003, John moved to New York to assume the roleof Worldwide Creative Director for TBWA. In 2006 he returned toSouth Africa where he continues in the same capacity. John is anExecutive Committee member of TBWA Worldwide.

Roux Marnitz (64)Independent Non-executive Directorand a member of the Remunerationand Nomination CommitteesAppointed: 8 April 2010

Roux studied engineering at the University of Pretoria where he graduated in 1967. In 1970 he was awarded

an MBA by the same university and obtained the BProc degree from UNISA in 1976. He also holds anAirline Transport Pilots Licence. Roux is the former chairman of the JSE-listed IT group, Comparex HoldingsLimited, former chairman of the Execujet Aviation Group, former Member of the Council of the University ofPretoria and is presently a director of private investment companies in Botswana and Namibia.

Malcolm McCulloch (56)Non-executive ChairmanAppointed: 18 August 2005

Malcolm is a Chartered Accountant who studied at theUniversity of Cape Town, and subsequently completed anAdvanced Management Programme at Wharton, the Universityof Pennsylvania, USA. Malcolm is a non-executive director ofWilson Bayly Holmes-Ovcon Limited and Deputy Chairman ofKelly Group Limited, both of which are listed on the JSE. He isalso the Chairman of Capital Africa Steel (Pty) Limited. Malcolmhas been involved with the Wilderness Group since 1992.


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BOARD OF DIRECTORS

NON-EXECUTIVE DIRECTORS

Robert Polet (54)Non-executive DirectorAppointed: 8 April 2010

Robert is Chief Executive Officer and Chairman of the ManagementBoard of Gucci Group. He joined Gucci Group in 2004 aftera 26-year career at Unilever, bringing with him considerableglobal management experience and a deep knowledge of thedevelopment of consumer brands in a multicultural environment.

Parks Tafa (42)Independent Non-executiveDirectorAppointed: 8 April 2010

Parks is a law graduate from the University of Botswana andhas been practising as an attorney (Independent) in Gaborone,Botswana since November 1991. He is a Botswana SeniorPartner at Collins Newman & Co law firm and is currently theNon-executive Chairman of Stanbic Bank Limited, LibertyLife Holdings and Stanbic Investment Management Services(SIMS). He is an Attorney, Conveyancer and Notary Public ofthe High Court of Botswana since November 1991.

Marcus Ter Haar (31)Independent Non-executiveDirector and a member ofthe Audit CommitteeAppointed: 8 April 2010

Marcus studied Economic Development at the Botswana CentreUniversity of East Anglia, in UK, and obtained a Masters degreein International Relations at the University of Reading, UK. Marcusthen went on to join De Beers on a Botswana graduate developmentprogramme. In 2004 Marcus became the Executive Assistantto the Director of the De Beers Group. After a short secondmentwith Rothschild Investment Bank in 2007, Marcus then moved to

Botswana where he currently works for Debswana as the GroupManager for Business Development. Marcus also serves on theBoard of Trustees for the Lady Khama Charitable Trust.

Gavin Tollman (46)Non-executive DirectorAppointed: 8 April 2010

Gavin Tollman has had a far-reaching executive career in the travelindustry. This has included managing both hotel companies andUnited Kingdom tour operators over the last 22 years, whichhave received various industry awards and recognition. He iscurrently the CEO of Trafalgar Tours, the worlds largest escortedtours operator, with product on six continents. At the companyhe has developed industry leading marketing, e-strategy and

product delivery initiatives. He is also a senior executive of theTravel Corporation responsible for the companys southern africaassets as well as the Managing Director of Worlds Leading TravelCompanies Limited where he oversees their United Kingdomdirect sell division. He is also a director of Cullinan HoldingsLimited. He holds a Bachelor of Science Degree in Finance fromThe American University, Washington DC.


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Michael Tollman (47)Independent Non-executive Director anda member of the Audit,Risk, Remuneration andNomination CommitteesAppointed: 8 April 2010

Michael became a director of Wilderness Safaris Investmentand Finance (Pty) Limited in 2005. He has extensive experiencein the travel and leisure industry worldwide. He has knowledgeand experience in the areas of finance, travel, mergers andacquisitions. He served as Non-executive Chairman for CullinanHoldings Limited since 17 June 2008 and was appointed asExecutive Chairman of the Board of Cullinan Holdings with effectfrom 19 March 2009. He holds a Bachelor of Commerce degreeand is a South African Chartered Accountant.

Jochen Zeitz (47)Non-executive Directorand Chairman of theSustainability CommitteeAppointed: 8 April 2010

Jochen is Chairman and Chief Executive Officer of Puma AG. Afterbeginning his professional career with Colgate-Palmolive inNew York and Hamburg, he joined Puma in 1990. In 1993 he wasappointed CEO and Chairman of the Board of Management. He hasalso been a member of the Board of Directors of Harley Davidsonsince 2007. Jochen discovered his interest in the African continentmany years ago. He speaks six languages, including Swahili. In 2008,he founded the Zeitz Foundation for Intercultural Ecosphere Safetyto support creative and innovative sustainable projects that balanceconservation, community development, culture, and commerce,promoting an inclusive, holistic paradigm of conservation thatenhances livelihoods and fosters intercultural dialogue.


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nearly as credible or as resilient to the worlds inevitable financial

cycles. This is something of which we are sincerely proud.

Along the way many likeminded wildlife people have joined

us to build a successful safari business, delivering a unique

experience for guests and strong returns for shareholders and

stakeholders, while ensuring that southern Africas pristinewilderness areas remain sustainably and profitably conserved.

With our listing on the BSE and JSE we are delighted to welcome

our new shareholders.

The listing of the Wilderness Group is an opportunity for us

to reposition the Group, and showcase in a transparent way a

business model that is founded on the principle of a sustainable

conservation economy. We at Wilderness believe we can do well

by doing good. Our listing has been followed by respectable

results with an EBITDA of Pula 115 million, an improvement on the

previous year in spite of the fact that revenues decreased slightly.

Wilderness is positioned in the niche ecotourism sector, one

that has enjoyed growth ahead of the broader tourism category.

Within these cycles we remain confident that this sector will

continue to show growth.

History and current structure of the business

Wilderness began operating 26 years ago and has focused

its operations on safaris in wild, pristine and remote areas.

Operations began initially within Botswana and then spread into

the rest of southern Africa and the Seychelles. Over time, the

business has evolved into a specialist luxury safari operation with

70 different safari camps and lodges in seven SADC countries,

hosting in excess of 25 000 guests per annum.

More than 26 years ago the founders of Wilderness fell in love with

the remote and wild places in Africa. Realising that the human impact

on these areas was indicative of a lack of care and understanding,

it became imperative that they and the wildlife within them be

conserved. Thus, the Company began with a single, simple idea: to

conserve these places by enabling people to visit them and earn a

return for the business and its employees at the same time. This wasnot a grand or complex idea but certainly an important one.

Wilderness started off by offering journeys and experiences to

discerning globally caring travellers. This concept developed

and broadened over the years so that today, Wilderness is in

the business of building sustainable conservation economies,

achieved through the employment of a responsible tourism model.

At Wilderness we believe that this is our single most significant

achievement to date: to have built a financially viable business

model that does not compromise our environmental principles.

In this way we have provided an alternate land use for Africas

wild areas, one that does not exhaust natural resources, does not

marginalise local communities and does not export its earnings.

Rather, our responsible ecotourism business is one that has

enhanced biodiversity conservation, engaged and uplifted rural

communities, partnered with governments, added a real viability to

Africas protected areas and had a net positive impact on the world.

It is important that we have been able to do this while showing a

return for our shareholders, something that in early 2010 enabled

us to take the company public and list it on the Botswana Stock

Exchange with a simultaneous inward listing on the Africa Board

of the JSE Limited. Without the financial robustness of a viable

business model, our approach to African conservation would not be

CHAIRMANS REPORT

We believe fully in our vision and

business model. We believe wedo contribute meaningfully to

conservation and that we are able

to build sustainable conservation

economies.

Malcolm McCulloch Chairman


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The Wilderness model

The Wilderness business model is vertically integrated and

consists of the following businesses within the value chain:

Safari consulting (tour operating and destination management);

Transfer and touring (air and road);

Camp, lodge and safari exploration operations; and

Finance and asset management.

These Group components integrate seamlessly, supporting the

three strategic pillars of the Wilderness business, being:

Tourism;

Conservation; and

Awareness.

Tourism

We believe fully in our vision and business model. We believe we

do contribute meaningfully to conservation and that we are able

to build sustainable conservation economies.

In order to most effectively coordinate our activities, we have

separated out four key elements of our environmental and

conservation strategy. These four elements together are a

cohesive and coordinated approach to achieving a meaningful

and sustainable conservation model twinned with the financial

viability provided by a responsible ecotourism business.

Conclusion

We have always said that we need pilgrims for the task of

conserving the wilderness. It is with this in mind that I would

like to thank my colleagues on the board that came together as a

team, in a relatively short space of time, and have already made

a substantial contribution to this development in Wilderness

direction. In particular I would like to welcome Roux Marnitz,

John Hunt, Marcus Ter Haar, Parks Tafa, Gavin Tollman, Robert

Polet and Jochen Zeitz. Our board has a wealth of insight and

experience in tourism, conservation, branding, finance as well as

a history of building businesses.

I would like to thank all our staff at Wilderness Holdings. In ourbusiness people are critical and we are fortunate in that we have

working for Wilderness some of the finest people in tourism and

conservation. They are the difference.

Lastly, I would like to express my appreciation to the Companys

shareholders, its loyal customers and guests for their continued

support. Wilderness is entering an exciting new phase and their

support is vital in our future success.

Malcolm McCulloch

Chairman


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compromising on guest experience or facility maintenance.

This resulted in a 4% increase in its gross profit percentage over

the previous year. It also reduced its fixed cost base by 13%

compared to the prior year.

The impact of reduced demand was exacerbated by the rand

and pula strength against the Groups main source currencies(approximately 55% of Group revenue is booked in dollars),

which resulted in revenues of P868 million for the year, 12%

below that of the prior year.

Nevertheless, the Group still managed to post a profit for the

year of P48 million and EBITDA improved by 9% over the previous

year to P115 million. The Company also generated P131 million of

cash from its operations and, as a result, its net cash position

improved from P39 million to P64 million.

The results for the year are substantially in line with the profitforecast in the IPO prospectus, the difference being attributable

largely to the continued strength of the pula and the rand.

Building profitable conservation economies

Wilderness is first and foremost a conservation organisation

and ecotourism company dedicated to responsible tourism

throughout the areas in which it operates in southern Africa.

Its goal is to share these wild areas with guests from all over

the world, while at the same time helping to ensure the future

conservation of Africas spectacular wildlife heritage, sharing the

benefits of tourism with local communities.

The Company believes that its conservation philosophy is a

key differentiator in a market where responsible tourism has

The year under review was a busy one in which Wilderness

made substantial advances on the strategic as well as operational

fronts. Highlights of the year include:

The successful listing of the Company on the Botswana

Securities Exchange and a simultaneous secondary listing on

the Africa Board of the JSE Limited.

A robust financial performance in its maiden year end resultsdespite difficult market conditions caused by the global recession.

The right-sizing of the business and prudent expenditure

discipline which contributed to reducing the Companys fixed

cost base by 13% over the prior year while improving its gross

profit percentage from 44% to 48%.

Performance overview

Wilderness performed well in tough conditions brought about

by the global financial crisis. In this environment, travellers

revaluated their priorities and as a result discretionary travel

spend came under severe pressure.

The impact on demand was sudden and, within the space of

three months, the order book went from being ahead of last

years levels to 25% behind. In addition, lead times shortened

while the time to close booking files lengthened as a result of

travellers taking their time to shop around in the search for better

value deals or discounted prices.

Consequently, occupancy levels at the Groups mature-state

businesses declined from 65% to 59%, while those in its developing

and Zimbabwe-based businesses dropped from 42% to 41%.

The Company was able to limit the impact of lower demand

on profitability by significantly reducing expenditure without

CHIEF EXECUTIVE OFFICERS REPORT

Wilderness is first and foremost

a conservation organisation andecotourism company dedicated to

responsible tourism throughout

the areas in which it operates in

southern Africa.

Andy Payne Chief Executive Officer


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become an important criterion for travellers when considering a

destination or tourism provider.

A new study commissioned by SNV Netherlands Development

Organisation and produced by the Centre for Responsible Travel

found that two thirds of people who walked into a travel agency

were looking for something that could be put back into the localdestination and contribute to the livelihoods of the community.

The study, which was based on traveller responses from six key

outbound countries: the US, Canada, UK, Germany, Holland

and Spain, demonstrates that consumers around the world are

increasingly aware of the potential impact of their tourism spend,

preferring socially responsible and environmentally sustainable

tourism products to traditional holidays.

Wilderness and its people

As important as its conservation philosophy are the people

who contribute to the Companys success. More than 85% of

the Companys staff complement comprises locals from thecommunities neighbouring the reserves and concession areas in

which it hosts its guests. As such they are inextricably linked to

the camps where they work and hold a stake in the conservation

of the surrounding wilderness.

The quality of the experience the Companys people provide

its guests is a critical competitive advantage and, as such, the

Company invests substantially in their growth and development.

Extensive training and mentoring programmes enable the

transfer of hospitality skills, improving the level of service at the

Companys camps.

The tough trading environment in which the Company operated

has also had a galvanising effect on the Groups people and has

increased the level of kinship within Wilderness. This positive

development will be further leveraged in the coming year to

ensure that this goodwill positively impacts on guest experience.

Prospects

The tentative upturn in the world economy has resulted in

an improvement in market conditions and the Group expectsoccupancies in the coming year to be better than those in the year

under review. However, there is still a high level of uncertainty

in world markets and the Company does not expect to see a

sustained improvement in the trading environment.

The focus of the Group for the coming year is to achieve financial

growth through increasing market share and investing in

marketing and operating scale opportunities. Wilderness, with

its strong balance sheet and competitive offering, is well placed

to capitalise on a rebound in markets when that occurs.

Andy Payne

Chief Executive


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CORPORATE GOVERNANCE

The directors are of the opinion, based on the information and

explanations given by management and the auditors, and on

comments by the auditors on the results of their audit, that theinternal accounting controls are adequate, so that the financial

records may be relied on for preparing the financial statements

and maintaining accountability for assets and liabilities.

Board of directors

On 8 April 2010, the Company was listed on the main board

of the BSE and simultaneously on the JSE Africa Board as a

secondary listing. The board now consists of 16 directors, being

five executive directors and eleven non-executives, four of

whom are independent as defined by King III. The non-executive

directors draw on their experience, skills and business acumento ensure impartial and objective viewpoints in decision making

processes and standards of conduct. The directors consider the

mix of technical, entrepreneurial, financial and business skills of

the directors to be balanced, thus enhancing the effectiveness

of the board.

Andrew Payne is the chief executive officer. The separation of this

role from that of the chairman ensures a balance of authority and

precludes any one director from exercising unfettered powers

of decision making. Malcolm McCulloch is the non-executive

chairman of the Company. The board is currently consideringthe appointment of a lead independent director to assist the

chairman to discharge his duties.

The board retains full and effective control over the Group

and monitors the executive management and decisions in the

subsidiary companies. The board is responsible for the adoption

of strategic plans, monitoring of operational performance and

management, determination of policy and processes to ensure

the integrity of the Groups risk management and internal

controls, communications policy, and director selection,

orientation and evaluation. These responsibilities are set out in

an approved Board Charter.

To fulfil their responsibilities adequately, directors have

unrestricted access to timely financial and other information,

records and documents relating to the Group. During the year,

the board received presentations from the management teams

of its major subsidiaries enabling it to explore specific issues

and developments in greater depth. Directors are provided

with guidelines regarding their duties and responsibilities as

directors and a formal orientation programme will be established

to familiarise incoming directors with information about the

Groups business, competitive position and strategic plans

and objectives.

The board is committed to good corporate governance and intends

to apply, insofar as it is reasonably possible, the guidelines of the

BSE code of Corporate Governance and King III (the King code).

Compliance with the BSE code of CorporateGovernance and the King code

It should be noted that during the period under review the

Company was a private company and therefore not obliged to

comply with either the BSE code of Corporate Governance or

King III to the same extent as a publicly listed company. Due to

the subsequent Company listing on the BSE and JSE, the directors

acknowledge that higher standards of governance will be

required. As such, the board is fully committed to the principles

of the BSE code of Corporate Governance and King III andremains confident that it will be able to state that the Company

is largely compliant with both standards by the publication of the

2011 Annual Report.

Directors responsibility for the annual financialstatements

The directors accept ultimate responsibility for the preparation

of the financial statements and related financial information that

fairly represent the state of affairs and the results of the Group.

The annual financial statements as set out in this report have

been prepared in conformity with International Financial

Reporting Standards and are based on appropriate accounting

policies which have been consistently applied and which are

supported by reasonable and prudent judgement and estimates.

Accountability and control

The board recognises its responsibility to retain full and effective

control over the Group.

The board has created a Risk Committee dedicated to monitoring

the risk management process. This committee reports to the

board on the likelihood and impact of risk materialising, as well

as mitigation initiatives and their effectiveness.

Furthermore, to enable the directors to meet their responsibilities,

management sets standards and implements systems of internal

control aimed at reducing the risk of error, fraud or loss in a cost

effective manner. These controls include the proper delegation

of responsibilities within a clearly defined framework, effective

accounting procedures and adequate segregation of duties.

The controls are monitored throughout the Company, and

all employees are required to maintain the highest ethical

standards in ensuring that the Companys business practices are

conducted in a manner which is in all reasonable circumstances

beyond reproach.


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Under the Companys Constitution, a third of the directors

retire by rotation each year and are eligible for re-election by

shareholders at the annual general meeting. As the majority ofdirectors are newly appointed, each newly appointed director

shall retire and offer themselves for re-election. Thereafter in

ensuring years, a third of directors shall retire by rotation. The

board recommends the reappointment of Messrs Derek de la

Harpe, Russel Friedman, Rolf Hartmann, John Gnodde, John Hunt,

Roux Marnitz, Andy Payne, Robert Polet, Parks Tafa, Marcus Ter

Haar, Gavin Tollman, Michael Tollman, Dave van Smeerdijk and

Jochen Zeitz and recommends shareholders vote in favour of

their reappointment at the Annual General Meeting.

The board has established the following committees to assist it

with its duties:

Audit Committee

Risk Committee

Remuneration and Nomination Committee

Sustainability Committee

Audit Committee

The Audit Committee comprises three non-executive directors:

Rolf Hartmann (Chairman)

Michael Tollman

Marcus Ter Haar

The chairman of the committee is not the chairman of the

Company.

The committee operates within defined terms of reference as

set out in its Charter and authority granted to it by the board

and meets at least twice a year. The external auditors, internal

auditors, chief executive officer and chief financial officer

are invited to attend. The external and internal auditors have

unrestricted access to the Audit Committee and meet with thecommittee members, without management present, at least

once a year.

The principal functions of the committee are to review the annual

financial statements, the half-yearly results announcement,

monitor the effectiveness of internal controls, assess the risks

facing the business, discuss the findings and recommendations

of the internal and external auditors, review the internal and

external audit plans and review the effectiveness of the internal

and external auditors. The chairman of the committee reports

on the committees activities at each board meeting. In addition

the Audit Committee annually considers and satisfies itself of

the appropriateness of the expertise and experience of the chief

financial officer.

The Audit Committee ensures that there is appropriate

independence relating to non-audit services provided by the

external auditors. Pre-approved permissible non-audit services

performed by the external auditors include taxation and due

diligence services.

The external auditors are prohibited from providing non-audit

services including valuation and accounting work where theirindependence might be compromised by later auditing their

own work.

The chairman of the Audit Committee will be available at the

Annual General Meeting to answer queries about the work of

the committee.

Risk Committee

The Risk Committee comprises executive and non-executive

directors:

Rolf Hartmann (Chairman) Michael Tollman

Andrew Payne

Derek de la Harpe

The committee operates within defined terms of reference, as

set out in its Charter and authority granted to it by the board,

and meets at least twice a year. The committee assists the board

in reviewing the risk management process and significant risks

facing the Group. The committee sets the Groups risk strategy in

liaison with the executive directors and senior management. In

doing so, it makes use of generally recognised risk management

and internal control models and frameworks in order to maintain

a sound system of risk management and internal control as

described later in this report.


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CORPORATE GOVERNANCE CONTINUED

Risk management

The board is in the process of establishing and implementing

a framework to regularly review all strategic risks impactingthe Company that can be consistently applied throughout the

entire organisation. Management has to date mainly focused

on identifying operational risks facing the Company. These

risks have been assessed taking into account the severity of the

impact on the Groups business if such identified risks were to

come to fruition. The Companys risk management framework

will be expanded to include financial, market, political, social,

ethical and environmental risks.

Internal audit

Internal audit is an independent appraisal function whichexamines and evaluates the activities and the appropriateness of

the systems of internal control, risk management and governance.

The Group has outsourced its internal audit function to Ernst &

Young. Internal audit operates within the authority granted to it

by the Audit Committee and the board. The Audit Committee is

satisfied that internal audit has met its responsibilities for the

year with respect to its terms of reference.

Audit plans are presented in advance to the Audit Committee

and are based on an assessment of risk areas involving an

independent review of the Groups own risk assessments.

The internal audit team attends and presents its findings to the

Audit Committee.

Remuneration and Nomination Committee

The Remuneration and Nomination Committee currently consists

of the following non-executive directors:

Malcolm McCulloch (Chairman)

Rolf Hartmann

Michael Tollman

The committee operates within defined terms of reference, as

set out in its Charter and authority granted to it by the board,

and meets at least twice a year. The chief executive officer and

chief financial officer may be invited to attend these meetings,

but they may not take any part in decisions regarding their own

remuneration.

The committee is responsible for making recommendations to

the board on the Groups framework for executive remuneration

and to determine specific remuneration packages for each

of the executive directors and certain senior managers of

the Group. The committee is also responsible for the Groups

remuneration policies.

The chairman of the committee will be available at the Annual

General Meeting to answer questions about the committees

work.

Sustainability Committee

The Sustainability Committee currently consists of the following

executive and non-executive directors:

Jochen Zeitz (Chairman)

Derek de la Harpe

Andrew Payne

John Hunt

The Sustainability Committee has recently been formed to assist

the board in developing sustainability strategies and monitoring

the implementation thereof. The board believes that sustainable

business practices in the dimensions of conservation, community,

culture and commerce form the platform for the business. The

board is in process of compiling detailed terms of reference for

this committee as it is envisaged that the committee will be

chartered with the responsibility of positioning the Company as

a leader in sustainable business practices going forward.

Company secretary

All directors have access to the advice and services of the

company secretary and are entitled and authorised to seek

independent and professional advice about the affairs of the

Group at the Groups expense.


17/122


Management reporting

The Group has established management reporting disciplines

which include the preparation of annual budgets by operatingentities. Monthly results and the financial status of operating

entities are reported against approved budgets. Profit projections

and cash flow forecasts are reviewed regularly, while working

capital, borrowing facilities and bank covenant compliance are

monitored on an ongoing basis.

Organisational integrity and ethics

The Group operates on the basis of decentralised management

across numerous countries. All employees are required to

maintain the highest level of ethical standards in ensuring that

the Groups business practices are conducted in a manner that,

in all circumstances, is above reproach. The directors believe that

the required ethical standards have been met during the year

under review.

Share dealings

The Company has a share dealing policy to regulate dealings by

its directors and applicable employees in the Companys shares.

No Group director or employee may deal, directly or indirectly,

in the Companys shares on the basis of previously unpublished,

price-sensitive information and during certain closed periods.

The closed periods include the periods between the Companys

interim and financial year end reporting times and the dates on

which the relevant results are published, and any time when the

Company is trading under a cautionary announcement.

Investor relations and shareholdercommunication

The Company is committed to providing timely, transparentand full disclosure to all its stakeholders on both financial and

non-financial matters.

The Group intends to maintain a dialogue with its institutional

shareholders via a planned programme of communications

headed by the chief executive officer and the chief financial

officer, together with nominated investor relations management.

These activities include regular meetings and presentations to

analysts, institutional investors and the media in Botswana and

South Africa, as well as meeting twice a year with institutional

investors after the release of the Groups interim and final results.

The Groups website (www.wilderness-group.com) provides

current and historical financial and other information on the

Group including formal announcements and presentations.

Shareowners and their appointed representatives are encouraged

to attend the Companys Annual General Meeting, to vote on

the resolutions placed before the meeting and to conduct

relevant discussions with the Groups directors. As noted above,

the chairmen of the Audit and Remuneration and Nomination

Committees attend the Annual General Meeting and are availableto answer questions on the activities of the committees.

Going concern

The directors assessment of the Group as a going concern is set

out on page 45.


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SUSTAINABILITY REPORT

The sustainability strategy inherent in the philosophy and

operations of Wilderness Safaris, Safari Adventure Company

and Sefofane is one that is neatly encapsulated by the 4 Cs:Conservation, Community, Culture and Commerce.

While the fourth C, Commerce, is the primary subject of this

annual report and is not expanded on in this section, the tenets

of each of the remaining three pillars are elucidated briefly below

while some of the highlights and landmark achievements in

these areas over the 2009/10 financial year are illustrated.

Conservation

Conservation is comprised of two equally important elements:

Operational Sustainability concerns the management of ourcamp and office front- and back-of-house operations in the

most sustainable and environmentally sensitive way possible

through the use of minimum standards, measurement,

efficiencies and mitigation, renewable energy technologies

and education of our staff and guests to ensure the lowest

possible carbon footprint. Water usage, waste treatment and

recycling, and construction and rehabilitation of old lodge

sites are all important additional aspects.

Biodiversity Conservation covers the measurement and

understanding of our biodiversity footprint and its management,

and where relevant the enhancement of indigenous species

richness through reintroductions (of absent indigenous species)

and rehabilitation (through vegetation management and anti-

poaching), as well as research projects in short, the fulfilling of

our obligations as custodians of more than 3 million hectares of

wild areas in southern Africa.

Community

The honest, mutually beneficial and dignified engagement of

our rural community partners (staff, equity partners, landlords,

neighbours) in ways that ensure sustainability beyond the

lifespan and aegis of our organisation and which deliver

a meaningful and life-changing share of the proceeds of

responsible ecotourism to all stakeholders.

These mechanisms include community-centric employment,joint ventures (equity, revenue share, traversing fees), education

(childrens camps, bursaries) and training, social benefits,

capacity building and infrastructure development (schools,

crches, clinics, etc).

Culture

Culture is a multifaceted element that governs respect for the

culture of all employees as well as remote rural communities

surrounding the conservation areas. This is reflected in: a

healthy social environment in camp; area appropriate camp

design, dcor, entertainment and meals; respect for traditional

rights within and surrounding the conservation area; guest visits

to traditional villages and homesteads; communication of the

areas traditional culture to guests and staff.


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Mean monthly income of community members in areas adjacent

to Wilderness camps, 2009

0

50

100

150

200

250

300

350

(US$) employed

(US$) unemployed

Botswana Malawi Namibia

0

20

40

60

80

100

Botswana Malawi Namibia

employed

unemployed

Is conservationimportant?

Comparison of staff and community members attitudes towards

conservation, 2009

Numbers of rural children hosted on week-long Children in the Wilderness (CITW) camps, 2001-2009

2002 2003 2004 2005 2006 2007 2008 2009

Botswana Namibia Malawi South Africa Seychelles Zambia Zimbabwe Total Trend-total numbers

2001

0

100

200

300

400

500


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SUSTAINABILITY REPORTCONTINUED

Within the 3 Cs described above, perhaps the most important

highlights of the 2009/10 year are as follows:

Conservation (operational sustainability):

The opening of the new Kalahari Plains camp in the Central

Kalahari Game Reserve, Botswana, the first camp owned and

operated by Wilderness that is entirely powered by renewable

energy (photovoltaic solar panels; solar water heaters).

This camp marks the culmination of a process that has evolved

over the past three to four years to increasingly lighten the

carbon footprint of our camp operations.

Conservation (biodiversity conservation):

The securing of the Chelinda Concession in Nyika National Park,

Malawi, a strategic move which allowed the extension of the

Wilderness brand of sustainability to the conservation of this

unique grassland ecosystem. With our expansion into this new

biome (Afro-montane) we expanded the Wilderness biodiversity

footprint from seven biomes to eight, a move that has resulted

in our ability to aid the conservation of significantly more

biodiversity. Some 90 bird species, 27 mammal species and

13 amphibian species that occur in Nyika do not for example

occur in any of the other Wilderness areas. This equates to

a 14% increase in bird diversity, a 13% increase in mammal

diversity and a 33% increase in amphibian diversity in terms of

the species for which Wilderness aids conservation.

Community:

The culmination of a 15-year partnership with the Torra

Conservancy saw Wilderness Safaris Namibia buying back

a 40% stake in Damaraland Camp, while the neighbouring

Doro!Nawas Conservancy secured a 30% equity stake in

Doro Nawas Camp. Both conservancies continue to receive

a percentage of revenue from each camp as payment for

traversing. These two equity deals saw the continued

evolution of our community engagement model, an evolution

that was measured by a rigorous and in-depth survey of staff

and community members in Namibia, Botswana and Malawi.

Wherever possible, all staff in each

camp are employed from the

respective community.

Namib Desert 44%

Dry Woodland (mopane) 34%

Afro-montane 4%

Karoo Shrubland 12%

Moist woodland (miombo) 3%

Kalahari Savannah 2%

Forest 1%

Indian Ocean Island 0.5%

Proportional composition of Wilderness traversing areaby biome (hectares), FY 2009/10

Proportional composition of Wilderness traversing area by biome,

FY 2009/10.


21/122

19Wilderness Holdings Limited Annual Report 2010


22/122


ANNUAL FINANCIAL STATEMENTS CONTENTS

Wilderness has developed

a powerful brand in theinternational and local

brand markets

w w w . w i l d e r n e s s - g r o u p . c o m

Wilderness Consolidated Financial Statements

Pro forma reporting accountants report 21

Preparation of the financial statements 23

Pro forma Group statement of

comprehensive income 24

Pro forma Group statement of

financial position 25

Pro forma abridged Group statement

of changes in equity 26

Pro forma abridged Group statement

of cash flows 27

Pro forma Group segmental analysis 28

Determination of pro forma Group

headline earnings 29

Group and Company accounting policies 30


Approval of annual financial statements 41

Independent auditors report 42

Directors report 43

Group statement of comprehensive income 48

Group statement of financial position 49

Group statement of changes in equity 50

Group statement of cash flows 51

Notes to the Group annual financial

statements 52

Company statement of comprehensive income 72

Company statement of financial position 73

Company statement of changes in equity 74Company statement of cash flows 75

Notes to the Company annual financial

statements 76

Wilderness Safaris Investment and

Finance (Proprietary) Limited

Independent auditors report 81

Directors report 82

Group statement of comprehensive income 84

Group statement of financial position 85

Group statement of changes in equity 86

Group statement of cash flows 87

Notes to the Group annual financialstatements 88

Company statement of comprehensive income 104

Company statement of financial position 105

Company statement of changes in equity 106

Company statement of cash flows 107

Notes to the Company annual financial

statements 108

Subsidiary companies of Wilderness

Holdings Limited 112

Subsidiary companies of Wilderness Safari

Investment and Finance (Pty) Limited 114


23/122


31 May 2010

The Directors


PO Box 5219

Rivonia

2128

Dear Sirs

INDEPENDENT REPORTING ACCOUNTANTS ASSURANCE REPORT ON THE PRO FORMA FINANCIAL INFORMATION OF

WILDERNESS HOLDINGS LIMITED

We have performed our limited assurance engagement in respect of the pro forma financial information set out in this report which

includes the pro forma financial information of Wilderness Holdings Limited (WH) for the year ended 28 February 2010 dated on or

about 31 May 2010 issued in connection with the release of the year end results by WH. The pro forma financial information has been

prepared in accordance with the requirements of the JSE Limited (JSE) and Botswana Stock Exchange (BSE) Listings Requirements,

for illustrative purposes only, to provide information about how the corporate action might have affected the reported historical

financial information presented, had the corporate action been undertaken at 1 March 2009 of the pro forma balance sheet being

reported on.

Directors responsibility

The directors are responsible for the compilation, contents and presentation of the pro forma financial information contained in the

press announcement and for the financial information from which it has been prepared. Their responsibility includes determining that:

the pro forma financial information has been properly compiled on the basis stated; the basis is consistent with the accounting policiesof WH; and the pro forma adjustments are appropriate for the purposes of the pro forma financial information disclosed in terms of

the JSE and BSE Listings Requirements.

Reporting accountants responsibility

Our responsibility is to express our limited assurance conclusion on the pro forma financial information issued to WH shareholders.

We conducted our assurance engagement in accordance with the International Standard on Assurance Engagements applicable to

Assurance Engagements Other Than Audits or Reviews of Historical Financial Information (ISAE 3000) and the Guide on Pro Forma

Financial Information issued by SAICA. This standard requires us to obtain sufficient appropriate evidence on which to base our

conclusion.

We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the

pro forma financial information, beyond that owed to those to whom those reports were addressed by us at the dates of their issue.

Sources of information and work performed

Our procedures consisted primarily of comparing the unadjusted financial information with the source documents, considering the

pro forma adjustments in light of the accounting policies of WH, considering the evidence supporting the pro forma adjustments and

discussing the adjusted pro forma financial information with the directors of the Company in respect of the corporate actions that are

the subject of this prospectus.

In arriving at our conclusion, we have relied upon financial information prepared by the directors of WH and other information from

various public, financial and industry sources.

PRO FORMA REPORTING ACCOUNTANTS REPORT

National Executive: GG Gelink Chief Executive AE Swiegers Chief Operating Officer GM Pinnock Audit DL Kennedy Tax, Legal and Risk Advisory L Geeringh Consulting L Bam

Corporate Finance CR Beukman Finance TJ Brown Clients & Markets NT Mtoba Chairman of the Board MJ Comber Deputy Chairman of the Board

A full list of partners and directors is available on request


24/122


PRO FORMA REPORTING ACCOUNTANTS REPORT CONTINUED

While our work performed has involved an analysis of the historical published audited financial information and other information

provided to us, our assurance engagement does not constitute an audit or review of any of the underlying financial information

conducted in accordance with International Standards on Auditing or International Standards on Review Engagements and, accordingly,

we do not express an audit or review opinion.

In a limited assurance engagement, the evidence-gathering procedures are more limited than for a reasonable assurance engagement

and therefore less assurance is obtained than in a reasonable assurance engagement. We believe our evidence obtained is sufficient

and appropriate to provide a basis for our conclusion.

Conclusion

Based on our examination of the evidence obtained, nothing has come to our attention which causes us to believe that, in terms of the

section 8.17 and 8.30 of the JSE and respective BSE Listings Requirements:

The pro forma financial information, derived from the reviewed consolidated financial information for WSIF and WH for the yearsended 28 February 2009 and 28 February 2010 respectively, has not been properly compiled on the basis stated;

Such basis is inconsistent with the accounting policies of WH; and

The adjustments are not appropriate for the purposes of the pro forma financial information as disclosed.

Deloitte & Touche

Registered Auditors

Per: Mark Rayfield

Partner

31 May 2010

Deloitte & Touche

Deloitte Place

The Woodlands

Woodlands Drive

Woodmead

2196


25/122



PRO FORMA RESULTSPREPARATION OF THE FINANCIAL STATEMENTS

The listing of the Company and the restructuring of the Group occurred on 8 April 2010. Therefore, at 28 February 2010 two parallel

holding companies existed and these were unlisted entities. The reviewed pro forma consolidated financial results enclosed in this

report have been prepared for illustrative purposes. The pro forma results have been prepared in accordance with the Companys

accounting policies and the underlying financial information used in their compilation is in compliance with International Financial

Reporting Standards and consistent with the accounting policies applied in the prior year. The information utilised in the preparation of

these pro forma accounts was extracted from reviewed financial information which has been prepared in accordance with IAS 34 Interim

Financial Reporting. The pro forma information has been prepared to provide an illustration of the Groups financial performance for

the year ended 28 February 2010 and should be reviewed in conjunction with the independent reporting accountants report thereon.

The pro forma consolidation assumes that the listing and restructuring occurred on 1 March 2009.


26/122



PRO FORMA GROUP STATEMENT OF COMPREHENSIVE INCOME

Pro forma Pro forma

Consolidated Consolidated

2010 2009

BWP000 BWP000

Revenue 868 139 986 390

Cost of sales (451 482) (554 877)

Gross margin 416 657 431 513

Operating costs (301 429) (325 955)

Operating profit before depreciation, amortisation and goodwill impairment

(EBITDA) 115 228 105 558

Depreciation and amortisation (50 569) (50 273)

Goodwill impairment (3 239) (328)

Operating profit 61 420 54 957

Finance income 2 838 6 857

Finance costs (9 359) (14 330)

Unrealised foreign exchange gain/(loss) on loans 24 124 (31 724)

Share of equity accounted investment earnings/(losses) 2 521 (897)

Profit before taxation 81 544 14 863

Taxation (35 789) (22 987)

Profit/(loss) for the year from continuing operations 45 755 (8 124)

Profit for the year from discontinuing operations 2 267 3 157

Profit/(loss) for the year 48 022 (4 967)

Other comprehensive (loss)/income: (23 996) 10 385

(Loss)/gain on revaluation of property, plant and equipment (35 038) 18 131

Income tax relating to revaluation of property, plant

and equipment 11 042 (7 746)

Total comprehensive income for the year 24 026 5 418

Profit/(loss) for the year attributable to:

Owners of the Company 47 523 (2 641)

Non-controlling interest 499 (2 326)

48 022 (4 967)

Total comprehensive income for the year attributable to:Owners of the Company 23 527 7 744

Non-controlling interest 499 (2 326)

24 026 5 418

for the year ended 28 February


27/122



PRO FORMA GROUP STATEMENT OF FINANCIAL POSITION

Pro forma Pro forma


2010 2009

BWP000 BWP000

ASSETS

Non-current assets 459 070 519 623

Property, plant and equipment 357 244 369 209

Goodwill 38 643 39 688

Investment in associates 49 731 50 831

Loans to related parties 319 35 101

Deferred tax assets 13 133 24 794

Current assets 208 901 142 556

Inventories 15 535 13 917

Trade and other receivables 90 889 66 104

Taxation 8 537 4 383

Cash and cash equivalents 93 940 58 152

Assets of disposal group classified as held for sale 1 197

Total assets 669 168 662 179

EQUITY AND LIABILITIES

Ordinary shareholders funds 239 556 225 036

Non-controlling interest (4 518) 386

Total equity 235 038 225 422

Long-term liabilities and payables 131 780 165 649

Deferred tax liabilities 22 736 24 603

Current liabilities 279 608 246 505

Payables, accruals and provisions 163 354 158 961

Future cash 83 211 62 634

Taxation 3 028 5 483

Bank overdrafts 30 015 19 427

Liabilities of disposal group classified as held for sale 6

Total equity and liabilities 669 168 662 179

as at 28 February


28/122



PRO FORMA ABRIDGED GROUP STATEMENT OFCHANGES IN EQUITY

Pro forma Pro forma


2010 2009

BWP000 BWP000

Balance at beginning of year 225 422 223 147

Exchange difference arising on conversion of foreign subsidiaries 3 315 2 700

Revaluation of property, plant and equipment (35 038) 18 131

Deferred tax effect of revaluation 11 042 (7 746)

Transfer of shareholders loans to short-term payables (12 017)

Total profit/(loss) for the year attributable to the owners of the Company 47 523 (2 641)

Minority interest arising on business combination (2 868) (3 755)

Minority portion of dividend paid (2 840) (2 088)

Non-controlling interest portion of profit/(loss) 499 (2 326)

Balance at end of year 235 038 225 422



29/122



PRO FORMA ABRIDGED GROUP STATEMENT OF CASH FLOWS

Pro forma Pro forma


2010 2009

BWP000 BWP000

EBITDA 115 228 105 558

Profit from discontinuing operations 2 267 3 157

Loss on disposal of property, plant and equipment 705 2 081

Revaluation of aircraft below original cost 4 437 264

Other non-cash items 12 838

Cash generated before working capital changes 135 475 111 060

Working capital changes (4 473) (84 231)

Cash generated from operations 131 002 26 829

Net finance costs paid (6 521) (7 473)

Taxation paid (29 340) (29 878)

Net cash inflow/(outflow) from operating activities 95 141 (10 522)

Net cash outflow from investing activities (43 131) (84 625)

Net cash (outflow)/inflow from financing activities (26 810) 98 938

Increase in cash and cash equivalents 25 200 3 791

Cash and cash equivalents at beginning of year 38 725 34 934

Cash and cash equivalents at end of year * 63 925 38 725

* Comprises cash resources, net of bank overdrafts and trade finance advances.



30/122



PRO FORMA GROUP SEGMENTAL ANALYSIS

Pro forma Pro forma


2010 2009

BWP000 BWP000

Revenue

Safari consulting 838 257 981 523

Camp, lodge and safari explorations 286 619 302 970

Transfer and touring 147 899 145 911

Finance and asset management 50 459 42 981

Intergroup (455 095) (486 995)

868 139 986 390

EBITDA





115 228 105 558

Total assets





Intergroup (471 884) (438 773)

669 168 662 179



31/122



DETERMINATION OF PRO FORMA GROUP HEADLINE EARNINGS

Pro forma Pro forma


2010 2009

BWP000 BWP000

Profit/(loss) attributable to owners of the parent per

the statement of comprehensive income 47 523 (2 641)

Headline earnings adjustments: 366 2 673

Goodwill impairment 3 239 328

Reversal of impairment relating to consolidation of Zimbabwe (8 015)

Revaluation of aircraft below original cost 4 437 264

Net loss on disposal of property, plant and equipment 705 2 081

Tax effect (345) (325)

Non-controlling interest (324)

Headline earnings/(loss) 47 220 (293)



32/122


WILDERNESS HOLDINGS LIMITED AND WILDERNESS SAFARIS INVESTMENT

AND FINANCE (PROPRIETARY) LIMITED

GROUP AND COMPANY ACCOUNTING POLICIES

The accounting policies mentioned below apply to both groups.

BASIS OF PREPARATIONThe financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS). They have been

prepared on the historical cost basis as modified by the revaluation of financial instruments reflected at fair value and aircraft.

In the current year, the Company and Group have adopted all the new and revised standards and interpretations of the International

Accounting and Standards Board (the IASB) and the International Financial Reporting Interpretations Committee (IFRIC) of the

IASB that are relevant to its operations and effective for the annual reporting period beginning on 1 March 2009. The adoption of these

standards has not resulted in changes to the Company and Group accounting policies. The following standards and interpretations

were adopted:

IFRS 2 (AC 139) Share-based Payments

IFRS 7 (AC 144) Financial Instruments: Disclosures IFRS 8 (AC 145) Operating Segments

IAS 1 (AC 101) Presentation of Financial Statements

IAS 16 (AC 123) Property, Plant and Equipment

IAS 18 (AC 111) Revenue

IAS 19 (AC 116) Employee Benefits

IAS 20 (AC 134) Accounting for Government Grants and Disclosure of Government Assistance

IAS 23 (AC 114) Borrowing Costs

IAS 27 (AC 132) Consolidated and Separate Financial Statements

IAS 28 (AC 110) Investments in Associates

IAS 29 (AC 124) Financial Reporting in Hyperinflationary Economies

IAS 31 (AC 119) Interests in Joint Ventures

IAS 32 (AC 125) Financial Instruments: Presentation IAS 36 (AC 128) Impairment of Assets

IAS 38 (AC 129) Intangible Assets

IAS 39 (AC 133) Financial Instruments: Recognition and Measurement

IAS 40 (AC 135) Investment Property

IAS 41 (AC 137) Agriculture

IFRIC 15 Agreements for the Construction of Real Estate

Revised standards and interpretations in issue not yet adopted

At the date of authorisation of these financial statements, the following revised standards and interpretations and/or amendments to

the standards and interpretations were in issue but not yet effective:

IFRS 2 (AC 139) Share-based Payments (effective 1 January 2010)

IFRS 3 (AC 140) Business Combinations Revised (effective 1 July 2009)

IFRS 5 (AC 142) Non-current Assets Held for Sale and Discontinued Operations (effective 1 July 2009)

IFRS 5 (AC 142) Non-current Assets Held for Sale and Discontinued Operations (effective 1 January 2010)

IFRS 9 (AC 442) Financial Instruments (effective 1 January 2013)

IAS 19 (AC 504) Employee Benefits (effective 1 April 2009)

IAS 24 (AC 126) Related Party Disclosures (effective 1 January 2011)

IAS 27 (AC 132) Consolidated and Separate Financial Statements (effective 1 July 2009)

IAS 28 (AC 110) Investment in Associates (effective 1 July 2009)

IAS 31 (AC 119) Interest in Joint Venture (effective 1 July 2009)

IAS 32 (AC 125) Financial Instruments: Presentation (effective 1 February 2010)

IAS 39 (AC 133) Financial Instruments: Recognition and Measurement (effective 1 July 2009)

IFRIC 17 Distributions of Non-cash Assets to Owners (effective 1 July 2009)

IFRIC 18 Transfers of Assets from Customers (effective 1 July 2009)



33/122




GROUP AND COMPANY ACCOUNTING POLICIES CONTINUED

BASIS OF PREPARATION (continued)Revised standards and interpretations in issue not yet adopted (continued)

On 16 April 2009, the Accounting Practices Board (APB) issued its latest set of annual improvements titled Improvements to

Statements of GAAP 2009. The annual improvements included 15 amendments to various Standards, including:

IFRS 2 (AC 139) Share-based Payments (effective 1 July 2009)

IFRS 5 (AC 142) Non-current Assets Held for Sale and Discontinued Operations (effective 1 January 2010)

IFRS 8 (AC 145) Operating Segments (effective 1 January 2010)

IAS 1 (AC 101) Presentation of Financial Statements (effective 1 January 2010)

IAS 7 (AC 118) Statement of Cash Flows (effective 1 January 2010)

IAS 17 (AC 105) Leases (effective 1 January 2010)

IAS 36 (AC 128) Impairment of Assets (effective 1 January 2010)

IAS 38 (AC 129) Intangible Assets (effective 1 July 2009)

IAS 39 (AC 133) Financial Instruments: Recognition and Measurement (effective 1 January 2010) IFRIC 9 (AC 442) Reassessment of Embedded Derivatives (effective 1 July 2009)

IFRIC 16 (AC 449) Hedges of a Net Investment in a Foreign Operation (effective 1 July 2009)

IFRIC 14 (AC 504) IAS 19 The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction

(effective 1 January 2011)

IFRIC 19 Extinguishing Financial Liabilities with Equity Instruments (effective 1 July 2010)

The directors anticipate that the adoption of these standards and interpretations in future periods will have no material impact on the

financial statements of the Company and Group.

SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTSIn preparing the Company and Group annual financial statements, management is required to make estimates and assumptions

believed to be reasonable that affect the amounts presented in the Company and Group annual financial statements and related

disclosures. Use of available information and the application of judgement are inherent in the formation of estimates. Actual results in

the future could differ from these estimates which may be material to the annual financial statements.

Significant accounting estimates and judgements include:

Trade receivables and loans and receivablesThe Company and Group assess trade receivables and loans for impairment at each reporting date. In determining whether an

impairment loss should be recorded in profit or loss, the Company and Group make judgements as to whether there is observable data

indicating a measurable decrease in the estimated future cash flows from a receivable, the timing and quantum of estimated future

cash flows and an appropriate discount rate to determine the present value of such cash flows.

Impairment testing for goodwill and non-monetary assetsThe recoverable amounts of cash-generating units and individual non-monetary assets are determined based on the higher of value-in-

use calculations and fair values less cost to sell. These calculations require the use of estimates and assumptions.

The Company and Group review and test the carrying value of assets when events or changes in circumstances suggest that the

carrying amount may not be recoverable. In addition, goodwill is tested on an annual basis for impairment. Assets are grouped at

the lowest level for which identifiable cash flows are largely independent of cash flows of other assets and liabilities. Estimates are

prepared of expected future cash flows for each group of assets. Expected future cash flows used to determine the value in use of

goodwill and tangible assets are inherently uncertain and could materially change over time.

Useful lives and residual values of property, plant and equipment

Residual values of buildings, motor vehicles and aircraft are based on current estimates of the value of these assets at the end of their

useful lives. The estimated residual values of the buildings and motor vehicles have been determined by the directors based on their

knowledge of the industry. The value of aircraft is assessed by the directors based on the currently available Aircraft Bluebook values.

The Aircraft Bluebook is designed and developed as a service for the purchasers of aircraft to assist them in arriving at the fair market

value of aircraft listed therein. It is intended as a guide and all prices in the digest are considered a representative average.



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SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS (continued)

Revaluation of assets

Aircraft are carried at revalued amounts. Revaluations are performed every year and take into account current market values and

replacement value of the significant components.

Taxation

Judgement is required in determining the provision for income taxes due to the complexity of legislation. There are many transactions

and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company and

Group recognise liabilities for anticipated tax charges based on estimates of whether additional taxes will be due. Where the final tax

outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and

deferred tax liabilities in the period in which such determination is made.

The Company and Group recognise the net future tax benefit related to deferred tax assets to the extent that it is probable that the

deductible temporary differences will reverse in the foreseeable future. Assessing the recoverability of deferred tax assets requires the

Company and Group to make significant estimates related to expectations of future taxable income. Estimates of future taxable income

are based on forecast cash flows from operations and application of existing tax laws in each jurisdiction. To the extent that future cash

flows and taxable income differ significantly from estimates, the ability of the Company and Group to realise the net deferred tax assets

recorded at the balance sheet date could be impacted.

SIGNIFICANT ACCOUNTING POLICIESConsolidation

Subsidiaries

Subsidiary undertakings, which are those companies in which the Group, directly or indirectly, has an interest of more than one half

of the voting rights or otherwise has power to exercise control over the financial and operating policies so as to obtain benefits fromits activities, have been consolidated. Subsidiaries are consolidated from the date on which effective control is transferred to the

Group and are no longer consolidated from the date of disposal. All inter-company transactions, balances, income and expenses and

unrealised surpluses and deficits on transactions between Group companies have been eliminated. Intragroup losses may indicate an

impairment that requires recognition in the consolidated financial statements.

On acquisition, the assets and liabilities of a subsidiary are measured at their fair values at the date of acquisition, except for assets

classified as held-for-sale, which are recognised at fair value less costs to sell. To the extent that the cost of the acquisition, in excess

of the fair value of the net assets acquired, is attributable to intangible assets that the entity holds for its own use or for rental to

others, this value is recognised as an intangible asset. Any additional difference between the cost of acquisition and total net asset

value of the entity is recognised as goodwill if after reassessment, the Groups interest in the net fair value of the acquirees realisable

assets, liabilities and contingent liabilities exceeds the cost of the business combination, the excess is recognised immediately as

profit or loss. The interest of minority shareholders is stated at the minoritys proportion of the fair values of the assets and liabilitiesrecognised at the date of the acquisition and the minoritys interest in the subsidiarys equity since the date of combination.

Where necessary, accounting policies for subsidiaries have been changed to ensure consistency with the policies adopted by

the Group.

The subsidiary companies of Wilderness Holdings Limited and Wilderness Safaris Investment and Finance (Pty) Limited are set out on

pages 112, 113 and 114.

In the Companys separate annual financial statements, investments in subsidiaries are carried at cost less any accumulated impairment.

The cost of an investment in a subsidiary is the aggregate of:

the fair value, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the

Company; plus

any costs directly attributable to the purchase of the subsidiary.



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SIGNIFICANT ACCOUNTING POLICIES (continued)Consolidation (continued)

Subsidiaries (continued)

An adjustment to the cost of a business combination contingent on future events is included in the cost of the combination if the

adjustment is probable and can be measured reliably.

The Group applies a policy of treating transactions with minority interests as transactions with equity owners of the Group. For

purchases of minority interests, the difference between any consideration paid and the relevant share acquired of the carrying

value of the net assets of the subsidiary is recorded in equity. Gains or losses on disposals to minority interests are also recorded

in equity.

AssociatesAn associate is an entity in which the Group has significant influence but not control, generally accompanying a shareholding of

between 20% and 50% of the voting rights. Significant influence is the power to participate in the financial and operating decisions of

the entity but is not control or joint control over those policies.

Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost, except when the

asset is classified as held-for-sale. Under the equity method, the Groups share of the post-acquisition profits or losses of associates is

recognised in the income statement and its share of post-acquisition movements in reserves is recognised in reserves. The cumulative

post-acquisition movements are adjusted against the carrying amount of the investment.

When the Groups share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further

losses, unless it has incurred obligations or made payments on behalf of the associate.

The use of the equity method is discontinued from the date the Group ceases to have significant influence over an associate.

Unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Groups interest in the

associates. Unrealised losses are also eliminated unless the transaction provides evidence of impairment of the asset transferred. Any

impairment losses are deducted from the carrying amount of the investment in associate. Distributions received from the associate

reduce the carrying amount of the investment.

Any excess of the cost of acquisition over the Groups share of the net fair value of the identifiable assets, liabilities and contingent

liabilities of the associate recognised at the date of acquisition is recognised as goodwill. The goodwill is recorded within the carrying

amount of the investment and is assessed for impairment as part of that investment.

The excess of the Groups share of the net fair value of an associates identifiable assets, liabilities and contingent liabilities over the

cost is excluded from the carrying amount of the investment and is instead included as income in the period in which the investment

is acquired.

In the Companys separate annual financial statements, an investment in an associate is ca

annual report 2010[1]wilderness

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