annual report 2011 - vivo energy energy... · for year 2011, vivo energy mauritius limited recorded...
TRANSCRIPT
-
Shell trademarks used under license
Vivo Energy Mauritius LimitedCemetery RoadRoche Bois Tel: (+230) 206 1234Fax: (+230) 240 1043www.vivoenergy.com
Annual Report 2011
-
Notes to the Financial Statements 1
Our Vision and Mission 3
Our Values 3
Chairman’s Message 4
Managing Director’s Report 5
Review of Operations 7
Aviation 7
Marine 7
Liquefied Petroleum Gas (LPG) 8
Retail 9
Commercial 10
Lubricants 11
Customer Service Centre 11
Product Supplies and Distribution 12
Human Resources 12
Health, Safety, Security and Environment 13
History of Vivo Energy in Mauritius 15
Directors’ Report 18
Secretary’s Report 21
Corporate Governance Report 22
Independent Auditor’s Report 45
Statement of Comprehensive Income 47
Statement of Financial Position 48
Statement of Changes in Equity 49
Statement of Cash Flows 50
Notes to the Financial Statements 51
Contents
Vivo Energy Mauritius Limited Annual Report 2011
-
Vivo Energy Mauritius Limited Annual Report 2011
Vision and Mission 3
Vivo Energy Mauritius Limited Annual Report 2011
2
We make the difference through our people, a team of
dedicated professionals, who value our customers, deliver on
our promises and contribute to sustainable development.
To safely market and distribute energy and petrochemical
products while offering innovative value added services.
Vivo Energy employees share a set of core values – honesty,
integrity and respect for people. We also firmly believe in the
fundamental importance of trust, openness, teamwork and
professionalism, and pride in what we do.
Vivo Energy’s key principles are:
• safety
• entrepreneurial flair
• ambition
• dynamism
• responsiveness
• empowerment
• social and ethical responsibility
• environmental care
Our Vision and Mission
Our Values
Vision
Mission
-
Vivo Energy Mauritius Limited Annual Report 2011
Chairman’s Message4
Vivo Energy Mauritius Limited Annual Report 2011
Managing Director’s Report 5
Chairman’s Message Managing Director’s Report
2011 has been an eventful as well as successful year.
Sales volumes were 15% better than 2010 thanks mainly to
Aviation and Marine. On an equally satisfying note, operating
profits have improved across the various segments of the
Company. Distribution costs were up by 16%, in line with
the growth in sales volumes, as cost efficiency continues to
remain a pillar inside the operating structure. Administrative
expenses have been contained to within 7% increase
compared to last year.
2011 has been a year of expansion and growth. We have
extended our retail network by opening a new service
station at Ebene. We have acquired a new barge, Tristar
Glory, to replace l’Ami Constant. I have full confidence that
these two investments will individually provide the building
blocks as we pursue our journey for sustainable growth.
We have a good safety record as a result of our proactive
management of all risks. We have had three incident-free
years in a row. We have once again successfully delivered
on our “Goal Zero” target as far as accidents and incidents
are concerned, causing no harm to people, assets and the
environment.
Our main achievement however remains the successful
transition from Shell Mauritius Limited to Vivo Energy
Mauritius Limited in 2011. After more than a year of hard
work, we officially left the Shell Group on 01 December
2011 to join Vivo Energy, made up of Vitol, Helios and Shell.
At the root of this seamless transition remains our open
communication to all our groups of stakeholders. Aware
that there would be questions asked and uncertainties
felt, we proactively and regularly engaged our employees,
customers, the authorities, the wider business community
and the public at large.
Indeed, the fact that 90% of our minority shareholders
remained with the new company is a mark of confidence
and trust in this new entity, Vivo Energy Mauritius Limited will
certainly be retaining what used to constitute our strengths:
its people, the Shell brand and our Shell products. Coupled
with the new shareholders appetite to grow in Africa, we
now have a useful combination of aspirations that is set for
exciting time to come. We have ended 2011 at the dawn
of positioning Vivo Energy as the most respected energy
company in Mauritius and Africa.
On this note, I would like to thank our stakeholders for
bearing patience with us. I have full trust that they will
manner. Indeed, the challenge in 2011 was to keep the
focus to maintain the “Business as Usual” mindset, whilst the
transformation was happening.
I would like to congratulate and thank the staff of Vivo
Energy Mauritius Limited under the leadership of Mr Pawan
Juwaheer for the dedication and professionalism with which
they have gone about their day to day business, never losing
sight of the key business priorities, with an unrelenting focus
on safety. I would like to thank the management for delivering
quality results. I also wish to thank the board of directors for
their guidance and direction towards Vivo Energy Mauritius
Limited.
Now it is the time for us all to move on, with a real sense
of optimism and excitement at the future. A future that
combines the strength of the Shell brand and products
for our consumers with the greater growth ambition and
aspiration of our new majority shareholders.
Looking ahead, we aim to remain the leader in safety, to
continue to add value to the business of our customers
while delivering profitable growth and creating greater value
for our shareholders. We will work to make Vivo Energy the
most respected energy business in Mauritius and in Africa, a
business where the best people want to work.
I look forward to our making it happen with enthusiasm,
commitment, creativity and with the ambition to win. I am
confident that we have the portfolio, people and capabilities
required to make the most of the opportunities ahead.
Honore Dainhi
Chairman
18 April 2012
I am happy and excited to join the board, and I am honoured to become the chairman. I look forward to working with all so that together we continue Vivo Energy Mauritius Limited’s successful journey.
For year 2011, Vivo Energy Mauritius Limited recorded a
30.2% growth in revenue from Rs 9,454 million in 2010
to Rs 12,313 million. The company’s profit after tax was as
good as in 2010, Rs 325 million in 2011.
2011 has been a very challenging year, on one hand
with the economic downturn and on the other with the
transition from Shell Mauritius Limited to Vivo Energy
Mauritius Limited. After weeks and months of hard work,
the transition occurred in the most seamless and successful
-
Vivo Energy Mauritius Limited Annual Report 2011
Chief Executive Officer’s Report6
Vivo Energy Mauritius Limited Annual Report 2011
Review ofOperations
Aviation
The aviation business has shown a good recovery on
profitability in 2011 compared to 2010. The general aviation
industry recovered in 2011 with more flights in Plaisance
though very far away from its peak in 2008. The industry
still faces many challenges and the sustained rise in fuel costs
is a constant issue to airlines.
Having won a major share of the Air Mauritius tender late
2010 contributed to an increase in volumes in 2011. Though
there is a high level of competition in the aviation business
in Mauritius, resulting to very low margins, these volumes
helped us to decrease our unit costs and reversed the
business financial trend.
The sales of Shell shares to Vivo Energy implied a change
in the strategy of the local aviation business. As from 1st
Dec 2011, the company is no more trading under the
Shell Aviation Brand but under the Vitol Aviation brand.
Vitol Aviation has been present in the Americas, North
West Europe part of Africa and part of Asia and has quite
some years of presence and is operating and exceeding
JIG requirements. Vitol Aviation has been first new entrants
in airports of Paris and London in the past 25 years and
has aggressive plans in place to grow the aviation business
worldwide.
With Vitol Aviation backing Vivo Energy, we look forward to
a promising year 2012.
Marine
Our strategy in Marine has once more paid off in 2011. We
have made a record year in profitability while maintaining
good volumes.
For the past 70 years, Vivo Energy Mauritius Limited
(formerly Shell Mauritius Limited) has been actively engaged
in the marine business and has operated a dedicated
bunkering depot in the heart of Port Louis. The State
Trading Corporation (STC) exclusively imports fuels within
Vivo specifications for fuel oil and gas oil. Our customers
can obtain a certificate of quality upon request after
recertification in an approved laboratory.
Our aim at serving our customers with quality recertified
products, ensuring availability of products both marine
gasoil, marine fuel oil and a range of marine lubricants, at an
optimum price, serviced either through the quays or through
our barge, L’Ami Constant, whichever is more convenient to
the customer has proved to be a winning formula. We have
also seen a regain in activities at the port with more vessels
coming in for different purposes and at the same time, the
local marine business improved with more fishing vessels
calling at Port Louis and new players getting in the fishing
activities around Mauritius.
There has been a major change in the business model of
the Marine business with the sales of Shell shares to Vivo
Energy. Traditionally, local customers place their orders
directly with the company (formerly Shell Mauritius Limited)
while the internationally contracted customers place their
orders through the Shell group marketing network of Shell
Marine Products based in London, Singapore, Rotterdam,
Cape Town, Oslo, Tokyo, Hong Kong, South Korea and
various other marine locations. This has changed whereby
all customers now place their orders directly to Vivo Energy
Mauritius Limited (formerly Shell Mauritius Limited). We are
pleased to announce that despite this major shift in the way
of doing business, we have been able not only to maintain
but to increase our customer portfolio. End users of our
international customer base are mainly tankers, containers,
cruises, feeder vessels, fishing fleets and cargo vessels.
keep collaborating for the betterment of the company. In
particular, I am grateful to our staff for their full support and
enthusiasm during the transition process.
We hold responsible citizenship close to our hearts and
have worked with the community in the fields of education,
sports, civic responsibility and environment. We worked
with local communities and the authorities on a national
education campaign to sensitize the general public on safety
precautions when using gas for domestic and automotive
purposes. We sponsored lifeskills training to vulnerable
children in partnership with the NGO, Junior Achievement
des Mascareignes. We supported the development of sports
through our contribution to Club Maurice for the Indian
Ocean Islands Games. Our commitment to environment
protection remains high on our agenda. We continued with
our projects of embellishment of Roche Bois area and the
rehabilitation and development of the Rivulet Terre-Rouge
Estuary Bird Sanctuary.
I encourage you to explore the highlights of our activities
and outcomes that contributed to the success of Vivo
Energy Mauritius in 2011.
Last but not least, I’d like to thank the outgoing Board
Chairman, Mamadou Sene for his invaluable guidance and
steer provided during the last five years. I wish him luck in
his future endeavours.
It is also with pleasure that I welcome our new Chairman,
Honore Dainhi. Honore Dainhi holds the position of Chief
Operating Officer of Vivo Energy. He has successfully grown
the business in a variety of roles and geographies. He brings
added value with his wealth of experience, new outlook and
vision. I look forward to having him aboard as we continue
to grow the company.
Finally, a special word of thanks to the board of directors for
their continued support.
Pawan K Juwaheer
Managing Director
April 20, 2012
-
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations8
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations 9
We presently offer quite a few advantages to our customers
for the safe supply of marine fuels and lubricants, namely:
• having an overall storage capacity of over 38,000 metric
tons, making Vivo Energy Mauritius Limited (formerly Shell
Mauritius Limited) having the biggest storage capacity in
the country;
• supplier of a “recertified” marine fuel oil by an independent
and accredited international laboratory;
• having access to various quays A, D, E and Trou Fanfaron
fish quay;
• operating a barge in Port Louis delivering fuels and
lubricants to ships at all other quays including container
terminals and also at anchor outside of the harbour;
• owning a dedicated bunkering depot in Port Louis located
adjacent to the main harbour;
• using two private quays at Froid des Mascareignes
comprising five bunkering points; and
• marketing a wide range of marine lubricants.
We remain fully engaged in implementing our bunkering
strategy as Port Louis increases its traffic and expands as a
regional and strategic port. We are extending our pipeline
for bunkering along other quays 1 - 4 namely. The long going
project of replacing L Ami Constant with a double hull barge
has finally materialized. As from January 2012, we will be using a
newly built barge, TriStar Glory, for our bunkering activities. This
vessel is state of the art and provides all modern facilities for a
safe, efficient bunkering activity. As such, we are providing L Ami
Constant, after 41 years of loyal service, a well deserved rest.
Thank you L Ami Constant.
Liquefied Petroleum Gas (LPG)
LPG is still, by far, a competitive source of energy for
domestic applications as compared to electricity. It is also an
environmentally friendly product as well as a convenient and
clean source of fuel for a number of industrial applications
including use in the textile, hotel and food sectors. Overall
volume improved slightly last year mainly propelled by the
growth in the domestic sector even if the LPG sector is
facing fierce competition from solar in both domestic and
the hotel sector for water heating purposes.
Shellgas has a wide distribution network which consists of
some 900 resellers throughout the island. In addition, we
provide a home delivery service in selected regions through
a network of resellers. As usual we also offer a variety of
cylinder sizes for various applications: 12kg and 5kg for
domestic purposes; 50kg for both domestic and industrial
applications and 12/15kg for forklift applications.
Installation services for domestic hot water or industrial
applications are provided through a number of professional
contractors who are trained and certified by Shellgas. This
ensures that all installations carried out by our contractors
are in conformity with international standards. In order
to sensitise the public for the need to comply with safety
requirements, a number of safety workshops and seminars
were organised for both the resellers and end consumers.
Shell autogas was introduced in 2001 as it offers a cheaper
alternative to motorists and brings in a number of benefits
to the environment because of cleaner emissions. Despite
the fluctuating prices, autogas still remains competitive as
compared to motor gasoline but it still high compared to
fuel oil. There is a large gap in price between the subsidised
domestic cylinders and autogas. This has resulted in a
number of motorists starting to decant subsidised LPG
from cylinders into their cars using unsafe equipment. As
a result of this illegal practice in 2011, autogas volume has
declined in our stations. This practice is very dangerous and
after the issue had been addressed with the authorities, a
new legislation has come into force since1st February 2012
about the use of 12kg cylinders exclusively for domestic
purposes.
volume on the last quarter was slightly below 2010, giving
some indications of an economic slowdown. Moreover, the
industry landscape has had also some major changes with
a new entrant on the market, increased competition with
strong tactical promotions.
As for retail, we were able to reach 99% of our targeted
volumes. The year was dense and rich in efforts and actions,
where attention was given to each of the pillars making the
foundations of the business.
Starting with Health, Safety, Security and Environment
(HSSE), we continued training and raising competencies
of forecourt staff, contractors and customers with the aim
of developing a safe attitude in the handling of petroleum
products. We pursued “Talk not Tick” initiatives, engagement
sessions, sharing of best practices, in order to enhance their
knowledge and capabilities. We ran the campaign “Don’t
fool with fuel” on the whole network. This year again, we
achieved goal zero (“zero incident, zero accident”).
In relation with marketing activities, we organized the
“Shell Fuel Save Challenge” among drivers from both
private companies and members of the public. Under the
supervision of SGS, the participants drove a 100-kilometre
track across the island, representative of the local driving
conditions (mix of urban and extra urban conditions).
They realized an outstanding performance in terms of fuel
economy using Shell fuels and Shell economy driving tips.
The average savings against car manufacturers’ specifications
were established at 35% using Shell Unleaded and Shell
Diesel Extra.
During our numerous road shows in different parts of
the island, we also took advantage of communicating the
benefits of Shell fuel economy products and disseminating
safe and fuel economy driving tips.
Our effort to invest in this sector is aligned with the concept
of ‘Maurice, Ile Durable’. The Shell autogas network today
comprises eight retail outlets namely: Lataniers (Port Louis),
Roadway (Port Louis), Goodlands, Emeralda (West coast),
Saint Jean (Belle Rose), Floreal, Pineview (La Vigie) and Bel Air.
Energy Storage Company Limited
Energy Storage Company Limited (ESCOL) is a 50:50 joint
venture, with Vivo Energy Mauritius Limited and Total. The
company has a mounded storage capacity of 3,000 metric
tons split in 6x500 metric tons tanks built with best practice
technology and which offers safe storage of LPG. The main
purpose of ESCOL is to allow larger tankers to supply LPG
to the country thus reducing unit freight cost. The contract
with STC for the handling, receipt and storage of LPG came
to an end in December 2009 and has been renewed for a
further five years. In order to adapt to changes in the port
area, a new pipeline was commissioned in February 2010 to
connect the new oil jetty with ESCOL.
Retail
Retail markets Shell products through its well distributed
network of 42 Shell service stations. Shell fuels are the
sole differentiated fuels being offered to customers: Shell
Unleaded Extra and Shell Diesel Extra with fuel economy
formula are designed to run extra kilometers, ensuring better
efficiency and protection to engines, compared to ordinary
fuels. We also offer Shell Autogas, Shell Lubricants and Shell
Gas. Shell Card is an easy-to-use, convenient and secured
payment card which ensures an efficient monitoring of fuel
expenses. Our Select and Shell Shops offer convenience
retailing for quick purchases.
The retail industry registered a growth in 2011, but which
was overall below 2010 and 2009. Noticeably, the industry
-
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations10
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations 11
With regards to operational excellence, we introduced
a new program “Mystery Motorist Program” whereby
an independent mystery shopper rates the service level
delivered on our forecourts and in our shops. This program
contributed in sustainably enhancing the service given to
our customers. Besides, we spent dedicated resources in the
training of our retailers, quality marshalls and forecourt staff.
As for the network, we invested a total amount of MUR 60M
in the infrastructure. We opened our 42nd retail outlet, Shell
Ebène Service Station, located in the Cybercity area on Rose-
Hill along Réduit road. We also carried out brand upgrade
works on the whole network. Upon works completion,
Shell Brands International rated the overall network with a
score of 97%, the best rating in Africa. Extension works and
canopy installation initiated on other sites in end 2011 will be
completed during the first semester 2012.
Shell Card registered a good growth especially in the last
quarter when we achieved the best volume ever recorded,
despite a tougher environment.
Overall, the 2011 retail financial performance was beyond target.
2012 prospects are surrounded by more uncertainty.
Export-oriented industries are facing greater challenges
with shrinking revenues due to Eurozone crisis. Many local
businesses are having more difficulty in accessing funds to
sustain their development. GDP growth and inflation will be
key to the retail industry dynamics.
Whichever the scenario is, the foundations are in place for
retail and the team will show the same dedication to grow
the business beyond plan.
Commercial
Safety PerformanceHSSE continues to be the number one priority for the
F&B business and our licence to operate. Our customers
tremendously value our contribution to their business in
terms of increasing their teams’ HSSE awareness.
Business Performance2011 was a difficult year for the F&B business, with limited
visibility on orders for the textile and manufacturing sectors.
However, several of our customers have diversified their
activities towards new export markets hence resulting in
subdued growth. The business was also negatively impacted
by the loss of a major Government transport tender.
Enhanced Partnership with our Valued CustomersWith the restructuring of the F&B sales team, we continued
to deliver value to our customer’s business as evidenced by
several testimonials signed by our major customers. Several
customers have placed their trust in Vivo Energy again as
evidenced by major contracts that have been renewed this
year. Several customers also participated actively in initiatives,
such as Customer Week. Our customers have continued to
positively benefit from our range of differentiated fuels with
demonstrated benefits. The transition to Vivo Energy was
smooth with numerous face-to-face and group engagements
with our valued customers.
Lubricants
Despite economic challenges, the Lubricants business
has exceeded its targets in terms of volumes and shown
excellent results in 2011. The business has maintained its
clear leadership in the automotive market helped by the
excellent growth in the automotive sector with Helix and
Rimula remaining the preferred lubricants brand of vehicle
owners.
The transition to Vivo Energy was a real success and
customers were extremely delighted that the Shell brand is
remaining in the local market.
The continued efforts of the whole sales team now fully
structured around the essential Sales First tools, on the field
as well as in the office led to some key customer acquisitions
while many customers renewed their trust in Vivo Energy as
their lubricants supplier. Moreover, the numerous targeted
marketing initiatives were also key to the excellent 2011
results.
The Lubricants team maintained the focus on the Health,
Safety, Security and Environment (HSSE) aspect and once
more, no incident was reported and the target of “zero
incident” was achieved. On and above more customer HSSE
trainings and lubricants site audits held, the team also shared
HSSE “Hearts and Minds” tools with key distributors and
resellers hence reaching a maximum of channel players.
Shell Lubricants has been elected the clear
world leader for the fifth year in a row1. This
further motivates the local Lubricants team
to face the 2012 challenges to maintain Shell
lubricants as the market leader in transport
and consumer lubricants sector.
Customer Service Centre
The Customer Service Centre (CSC) was launched in 1997.
Since then, our CSC has gradually become key to the day-to-
day business activities of the company.
Our CSC is a one-stop shop for our valued customers.
Through a call centre, we provide basic services, namely order
taking from both retail and commercial customers for fuels
and lubricants, complaints handling, invoicing and responding
to queries on customer accounts.
Over the years, we upgraded and extended our services to
include debtor follow up, maintenance calls management,
lubricants and LPG milk-run delivery scheduling and planning
and telesales/telemarketing support to other businesses.
Our CSC receives about 80,000 calls a year. These are handled
by our trained agents who have been empowered to act
as business and service focal points for HSSE, Commercial,
Lubricants, LPG, Aviation and Marine.
CSC Mauritius has been scoring more than 99% in the customer
satisfaction index surveys since 2008 and is maintaining this
high score. Furthermore, we are the only operating unit in
Africa to deliver consistently on all our targets since 2007 and
ended the year once again ahead of all the African countries.
We face an ever-growing demand for services both internally
and externally. Our prime objective is to bring continuous
improvement to our service to distinguish ourselves on the
market and satisfy our customers through service excellence.
Vivo Energy Mauritius Limited is the only petroleum company
operating such comprehensive customer service in the country.
To that effect, we are continuously revisiting our processes
and striving to maintain high performance through focus and
emphasis on people development and staff motivation.
1 : Source: Kline & Company, Competitive Intelligence for the Global Lubricants Industry, 2008–2018.).
-
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations12
Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations 13
Supplies
Vivo Energy Mauritius Limited co-ordinates the replenishment
programme on behalf of the oil industry with the State
Trading Corporation (STC) for both main products and LPG.
Some 66,000 metric tons of LPG and 897,000 metric tons
of main products were imported in 2011. LPG is received in
consignments of 2,000-3,000 metric tons from LPG tankers;
white and black oils are received in 60,000 metric ton
tankers, combining oil industry and Central Electricity Board
requirements, after the commissioning of the new oil jetty in
November 2008 and the coming into operation of Red Eagle,
the Mauritian owned oil tanker.
Vivo Energy Mauritius Limited purchases from STC in 2011
amounted to 319,000 metric tons for main products and
32,000 metric tons for LPG, representing 35% and 48% of total
trade respectively.
The Shell group “SAFE” system for vetting tankers is
systematically utilised to ensure suitability of all vessels before
loading. Sub standards vessels are therefore avoided, thus
ensuring a better protection for Mauritian shores.
Distribution
Vivo Energy Mauritius Limited owns and operates two depots,
namely Roche Bois and Causeway. Roche Bois is mainly used
for the storage of white oils and includes an LPG depot with a
semiautomatic cylinder filling plant, as well as packed lubricants
stores. Causeway depot is essentially for the storage and
distribution of fuel oil to both marine and industrial customers.
These two depots constitute a storage capacity of 23,000
metric tons for white oils, 16,000 metric tons for black oils and
1,200 metric tons for LPG, representing 32%, 54% and 20%
respectively of total oil industry storage capacity in Mauritius.
Besides these two depots, Vivo Energy Mauritius Limited
operates three other depots on behalf of the oil industry, one
at Fort William for the storage of fuel oil on behalf of the
Central Electricity Board, the second one in Rodrigues Island,
and thirdly, a joint venture LPG storage, ESCOL, of 3,000
metric tons capacity, in which Vivo Energy Mauritius Limited
owns 50% equity.
Distribution to retail outlets, industrial customers and the
airport is effected by a fleet of 11 bulk delivery vehicles for
white oils and black oils. A fleet of 15 vehicles distributes
LPG cylinders across the island to retailers, while bulk LPG
is delivered through three specialised vehicles. Deliveries to
marine customers are effected either through bunkering barge
or through pipelines at quays.
Replacement of the bunkering barge with a new double has
been completed in 2011.
Human Resources
TalentMauritian talents continue to be recognised by the region. As
at end December 2011, 11% of our total workforce i.e. 13
out of 121 employees were holding regional positions from
Mauritius. In addition, two other Mauritians were in expatriate
assignments in Madagascar and South Africa; of which Pramoth
Domun, our previous B2B Manager, who in 2011 went to
Madagascar as Managing Director.
Change ManagementIn order to assist our people embrace the transition to Vivo
Energy, ‘Managing Change’ sessions were held for all the
employees. The sessions helped our people to effectively
manage the emotions linked to the change and helped them
articulate the benefits of the change. As such, despite the
uncertainty linked to the transition, our people remained
committed, focused and dedicated.
ResourcingDuring 2011, we welcomed seven newcomers in our
organisation. Two of them joined the Retail Department, two
others joined the Distribution Department and the remaining
three the B2B Department. The newcomers brought with them
a wealth of experience, skills and competences from different
fields, acquired either in Mauritius or abroad.
Learning and DevelopmentDuring 2011, the average training days per employee was 3.5
days with learning programmes ranging from HSSE, customer
service, compliance, media training to name a few.
Health, Safety, Security and Environment
Vivo Energy Mauritius Limited operates under a common set of
business principles, supported by policies and business controls.
These include a Health, Safety, Security and Environment (HSSE)
Policy and Commitment, which require that our company shall
have a systematic approach to HSSE management. We have
put in place a mandatory procedure for an HSSE Management
System (HSSE MS), which is a structured set of controls for
managing the business and to ensure and demonstrate that
business objectives are met. This management system takes into
account HSSE MS implementation requirements, incorporated
in the business level HSSE MS as well as the various classes
of business HSSE MSs relevant to our operations. Classes of
business are distribution, aviation, marine, business-to-business,
LPG and retail. The elements of this management system are
organised according to the Vivo Energy guidance of how to
integrate HSSE into the business and manage HSSE matters as
any other critical activity. In line with our HSSE policy to achieve
continuous performance improvement, the individual classes of
business action plans have been well observed and completed.
An HSSE community has been built up, comprising staff holding
HSSE critical positions, to motivate better our employees,
contractors, retailers and customers at large. Our motto is
“Together, we continue to make our company safer”. This
is what motivates us at Vivo Energy Mauritius Limited, to
strive hard to make things happen. The HSSE community
has the full support of the Country Coordination Team who
continuously demonstrates their leadership and commitment,
thus enhancing HSSE culture and maintaining high standards of
HSSE performance.
Safety daySafety day was celebrated on 12 June 2011 with the participation
of both employees and contractors. The objectives of the day
were spelt out, namely re-commitment to ‘Do the Right Thing -
Today and Everyday’, to make it personal and to improve focus
on HSSE during the year, understand what makes a good and
HSSE performance 2009-2011
2009 2010 2011
Fatality zero zero zero
Total Recordable Cases zero zero zero
Total Recordable
Occupational Illness
Frequency zero zero zero
Exposure Hours 700,000 600,000 571,000
Lost Time Injury zero zero zero
Spills NIL NIL NIL
Kilometres driven 2, 321,000 2,100, 000 1, 997,000
-
Vivo Energy Mauritius Limited Annual Report 2011Vivo Energy Mauritius Limited Annual Report 2011
Review of Operations14
bad driver, how to be a good passenger and pedestrian, adopt
good practices and reduce the number of road and workplace
accidents and most importantly making things happen on
the ground through toolbox talks. Staff and contractors were
requested to gear their toolbox talk presentations on the safety
issues encountering at the moment or that issues they are
anticipating in upcoming jobs.
The session ended with staff and contractors HSSE recognition
and close out by the Managing Director. Follow up after safety
day is paramount. We need to find time to reflect on how
everyone will ensure they are doing the right thing. This will
definitely help to make our journey to goal zero a reality.
Goal zero initiativeSafety is a deeply held value, integral to our values of honesty,
integrity and respect for people. It means relentlessly pursuing
no harm to people and no significant incidents. Goal zero shifts
the way we think and act. We firmly believe that goal zero is
possible.
Life-saving rulesFar too many people still get hurt while working for Vivo
Energy. This is not acceptable and we must never make it seem
an inevitable consequence of working in dangerous industry.
By introducing the twelve life-saving consistent set of rules to
our staff, retailers and contractors, we believe that things will
be done differently by instilling the compliance culture. Twelve
high-risk operations at work have been identified and the aim
is to prevent harm to people. Each reported non-compliance
is now investigated and failure to comply results in discipline
and up to termination of employment or discharge in case of
contractors. Supervisors are held accountable to communicate
and ensure compliance. Employees and contractors comply
because it is the right thing to do and it saves lives. We must
adopt the principle of zero tolerance for non-compliance. If
anyone intentionally breaks any of our life-saving rules, that
person chooses not to work for Vivo Energy.
The Shell Company of East Africa Limited started its marketing
operations in Mauritius in 1905 through its managing agents,
Blyth Brothers and Company Limited. As such, Shell was the
first international oil company to set up business on the island
and its close partnership with Blyth has been the cornerstone
of a successful development. Most of the sites of current
service stations, depot and customer portfolio were acquired
during this time.
As part of a regional corporate reorganisation in the late
1950s, the Shell Company of East Africa was replaced by the
Shell Company of the Islands Limited, a branch of a company
incorporated in the United Kingdom. After the irreversible
turmoil on the international oil scene in the early 1970s and
recognising the need for oil companies to have their own
identity and direct dialogue with Government, Shell and Ireland
Blyth Limited, who was then the oldest Shell agents in the
world, negotiated the terms of the agency agreement. In 1976,
therefore, Shell took over its own business management in
Mauritius, directly promoting its activities, engaging its own staff
and opening its own offices.
As a result of a decision made by the Shell and BP groups to
deconsolidate their joint business interests in Africa in 1982,
BP Ocean Islands Limited’s activities in Mauritius were taken
over by Shell to become Shell Ocean Islands Limited. Both The
Shell Company of the Islands Limited and Shell Ocean Islands
Limited were given the status of a Public Limited Company (plc)
as a result of a change in British Company Law. On January
1st 1991, the businesses of the local branch of both The Shell
Company of the Islands plc and Shell Ocean Islands plc were
transferred to a locally incorporated company, Shell Mauritius
Limited, in exchange for shares in the latter. This change in
corporate structure underlines Shell’s confidence in the future
of Mauritius and the current shareholders’ desire to further
consolidate Shell’s association with the island. In addition, the
newly incorporated company was floated on the Mauritian
Stock Exchange and the Mauritian public currently owns 25%
of its shares.
On 30 November 2011, Vitol, Helios and Shell finalised the
acquisition of the majority shareholding in Shell’s downstream
business in Mauritius as well as six other countries: Cape Verde,
Madagascar, Mali, Morocco, Senegal and Tunisia. This marked the
beginning of Vivo Energy Mauritius Limited.
During its 107-year presence in Mauritius, Vivo Energy has built
up a comprehensive business network in the energy scene,
backed up by strong infrastructural investments, good technical
know-how and professionalism. Vivo Energy Mauritius Limited
accounts for nearly half of the imported energy demand of the
island and is present in all sectors of this business activity.
Vivo Energy Mauritius Limited is a leader in the provision of both
automotive fuels and lubricants to the Mauritian downstream
market through its extensive network of service stations,
business-to-business commercial clients and aviation fuel at
Plaisance airport. It supplies both national and international
shipping with bunker fuels and lubricants at Port Louis and the
surrounding area.
Vivo Energy Mauritius Limited is a large supplier of Liquefied
Petroleum Gas (LPG) in the country, which is used for both
domestic cooking purposes and commercial uses. In order
to ensure continuity of supplies of this essential product for
the country and also to have tonnage available for export to
other countries of the region, Vivo Energy Mauritius Limited
has effected a substantial investment in 3,000 metric tons of
storage capacity at Roche Bois through its joint venture, Energy
Storage Company Limited.
Global Environmental StandardsWe all strive to have an environmental performance we can
be proud of. We have in place a system for reporting and
investigating environmental incidents and we have completed
a risk-based assessment of our sites and all actions have been
closed.
Competence assessmentPeople are one of the key barriers we have in place to mitigate
risks. We want to assure ourselves that the people barriers are
robust and competent to do this important job. We want to
be able to provide assurance that:
• An employee is competent for the job or task they are
performing
• We know they are competent through testing and recorded
outcomes
• The tests we use are valid, reliable, and recognized by
regulators, stakeholders, and other external parties
Our predominant focus is on proficiency level “skill”.
HSSE Culture LadderTaking on board initiatives started during previous years and
with the commitment of all staff and contractors, Vivo Energy
Mauritius Limited has reached the proactive level on the HSSE
culture ladder.
6. History of VivoEnergy in Mauritius
-
Shell Mauritius Limited Annual Report 2011
Notes to the Financial Statements 16
Vivo Energy Mauritius Limited Annual Report 2011
Financial Statements
-
Vivo Energy Mauritius Limited Annual Report 2011
Directors’ Report18
Vivo Energy Mauritius Limited Annual Report 2011
Directors’ Report 19
DIRECTORS’ REPORT
The directors present their annual report and the audited
financial statements of Vivo Energy Mauritius Limited (formerly
Shell Mauritius Limited) (the “Company”) for the year ended
31 December 2011.
PRINCIPAL ACTIVITIES
The Company’s principal activity is the marketing and
distribution of petroleum products. Its joint venture, Energy
Storage Company Limited, is involved in the provision of LPG
terminal usage facilities.
CHANGE OF NAME
During the year, the Company changed its name from Shell
Mauritius Limited to Vivo Energy Mauritius Limited.
RESULTS AND DIVIDENDS
The Company’s profit for the year is Rs 324,860,000
(2010 - Rs 324,923,000).
The financial statements of the Company for the year ended 31
December 2011 are set out on pages 47 to 88. The auditor’s
report on these financial statements is on pages 45 and 46.
DIRECTORS
The directors of the Company since 01 January 2011 and at
the date of this report are:
Mr Mamadou Sene (resigned on 15 December 2011)
Mr Pawan K Juwaheer
Mr Patrick Crighton
Mr Roger K F Leung Shin Cheung
Mr Antoine Delaporte
Mr G Honore Dainhi (appointed on 29 February 2012)
CONTRACTS OF SIGNIFICANCE
Until 30 November 2011, the only contracts of significance
between the Company and its related partners were:
(a) a Cost Contribution Agreement for Business Support
Services and Research and Development and Technical
Support Services, and
(b) a Management Advisory Services Agreement,
both with Shell International Petroleum Company, a subsidiary
of the ultimate parent.
With effect from 01 December, the company entered into the
following contracts with related parties:
(a) licence agreement for the branding of retail automotive
fuel sites and other assets with Shell Brands International
AG; and
(b) contract for the provision of services with Africa
Downstream Oil Products (Proprietary) Limited.
The Company declared and paid thefollowing dividends during the year:
Dividend per share
2011 2010
Rs Rs
Declared on:
25 March 2011 6.10 5.00
22 November 2011 5.00 5.00
11.10 10.00
For the year ended 31 December 2011, the Company
made a profit of Rs 11.08 (2010 – Rs 11.08) per share and
declared a total dividend of Rs 5.00 (2010 - Rs 5.00) per
share of which Rs Nil (2010 - Nil) was paid during the year.
Subsequent to the year end, the company has through a
board resolution dated 26 March 2012 declared a final divi-
dend of Rs 6.10 ( 2010:Rs 6.10) per share.
DIRECTORS’ REPORT (CONTINUED)
STATEMENT OF DIRECTORS’RESPONSIBILITIES IN RESPECT OF THEFINANCIAL STATEMENTS
Company law requires the directors to prepare financial
statements for each financial year which present fairly the
financial position, financial performance and cash flows of the
Company. In preparing those financial statements, the directors
are required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable and
prudent;
• state whether International Financial Reporting Standards
have been followed, subject to any material departures
disclosed and explained in the financial statements; and
• prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
The directors confirm that they have complied with the above
requirements in preparing the financial statements.
The directors are responsible for keeping proper accounting
records which disclose with reasonable accuracy at any time
the financial position of the Company and to enable them
to ensure that the financial statements comply with the
Mauritian Companies Act 2001. They are also responsible for
safeguarding the assets of the Company and hence for taking
reasonable steps for the prevention and detection of fraud and
other irregularities.
-
Vivo Energy Mauritius Limited Annual Report 2011
Directors’ Report20
Vivo Energy Mauritius Limited Annual Report 2011
Secretary’s Report 21
MAJOR SHAREHOLDERIn February 2012, Vivo Energy Mauritius Holdings BV
(Netherlands) bought 631,627 shares from minority
shareholders and as a result, holds 22,623,316 shares (77.15%)
at the end of February 2012.
SEGMENTAL ANALYSISA business segment analysis of sales and results is given in Note
5 to the financial statements.
SERVICE CONTRACTSMessrs Patrick Crighton and Pawan K Juwaheer have service
contracts without an expiry date.
Service contracts of other directors are terminable with a 3
months’ notice period by either party.
DIRECTORS’ INTERESTSThe directors have no interests in the ordinary share capital of
the Company, either directly or indirectly.
THREE YEAR SUMMARYA three year financial summary is set out in Note 29 to the
financial statements.
DONATIONSDuring the year, the Company made donations of Rs 69,370
(2010 - Rs 106,350).
AUDITOR
The fees charged by the auditor, PricewaterhouseCoopers, for
audit and other services were:
2011 2010
Rs’000 Rs’000
Statutory audit 1,746 2,008
Audit related services 630 600
PricewaterhouseCoopers has indicated its willingness to
continue in office and will be automatically reappointed at the
Annual Meeting.
Approved by the Board of directors on 26 March 2012
and signed on its behalf by:
}
}
} DIRECTORS
}
SECRETARY’S REPORT TO THE MEMBERS OFVIVO ENERGY MAURITIUS LIMITEDUNDER SECTION 166(D) OF THE COMPANIES ACT 2001
We certify that we have filed with the Registrar of Companies all such returns as are required of
the Company under the Companies Act 2001.
Executive Services Limited
As per Christian Angseesing ACIS
CORPORATE SECRETARY 26 March 2012
DIRECTORS’ REPORT (CONTINUED)
-
Vivo Energy Mauritius Limited Annual Report 2011 Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 23
MAURITIUS CODE OF CORPORATE GOVERNANCE COMPLIANCE
The disclosures contained in this report are intended to
provide the reader with a description of Vivo Energy
Mauritius Limited (formerly Shell Mauritius Limited)
corporate governance policies and practices. The directors
firmly believe in and support high standards of corporate
governance, which are critical to our business integrity.
The Board confirms compliance to the Mauritius Code of
Corporate Governance.
HOLDING STRUCTURE
BOARD OF DIRECTORS
The Board of directors of Vivo Energy Mauritius Limited
(formerly Shell Mauritius Limited) remains stringent when
it comes to upholding the highest standards of integrity
and transparency in their governance of the company.
The importance and the value of a balanced interplay
between directors, management and shareholders within
the company has long been a major principle governing the
conduct of Vivo Energy Mauritius Limited (formerly Shell
Mauritius Limited).
A Board of directors consisting of five directors manages
Vivo Energy Mauritius Limited (formerly Shell Mauritius
Limited). Directors are appointed at the annual meeting of
shareholders. They hold office until they retire or submit
their resignation, unless removed earlier from office by the
annual meeting of shareholders.
The board delegates the day-to-day running of the company
to the Managing Director. The board delegates operational
issues to the management team and is directly accountable
to the shareholders for the performance of the company.
During the year ended December 31, 2011, ten board
meetings were held.
The offices of Chairman and Managing Director were
separated on November 17, 2003 in order to align
board governance with the Mauritius Code of Corporate
Governance. A Non-executive Director occupies the Office
of Chairman and an Executive Director occupies the office
of Chief Executive. The Chairman and Managing Director
ensure that the members of the board receive accurate,
timely and clear information.
HVInvestments BV
(Netherlands)
80%
Shell OverseasInvestment BV
(Netherlands)
20%
Vivo Energy Holding BV(Netherlands)
100%
Vivo EnergyMauritiusHolding BV(Netherlands)
75%
LocalShareholders
25%
Vivo EnergyMauritius Ltd
CorporateGovernance Report
Profile of directors
OUTGOING CHARIMAN INCOMING CHARIMAN
Mr Mamadou Sene, aged 48(resigned on 15 December 2011)
Chairman and Non-Executive Director
Honore Dainhi, aged 45(appointed on 29 February 2012)
Chairman and Non-Executive Director
CORPORATE GOVERNANCE REPORT (CONTINUED)
Mamadou Sene joined Shell in 1993 in Senegal from
Ernst and Young. During the last 17 years, he has held
various positions in operating units and central offices. He
worked in Finance in Senegal then in Mali before taking
the responsibility of Commercial Manager and Country
Chair in Mali. Thereafter, he moved to London to join the
Oil Products Finance Planning and Business Performance
department in Shell Centre. Before taking his current role
of Sales and Operations Vice President South East Africa
Oil Products, he was leading the Planning and Business
Performance department for Shell Oil Products Africa.
Honore Dainhi joined Shell in Cote D’Ivoire 1996 as Retail
Sales & Operations Manager. In 1998, he was promoted to
Retail Manager. Between 2000 and 2001, he was appointed
Audit Manager for Global LPG based in London. For part
of 2002, he was Retail Business Advisor for the South Zone/
Africa Retail Core Team. Between 2002 and 2004, he took
the job of Regional Retail Manager for West & Central
Africa covering 600 retail stations & 110 staff spread in
13 countries. In 2004, he moved to The Hague where he
took the job of Senior ID Adviser for Sub-Saharan Africa. In
2006, he was appointed Regional Vice-President for West
Africa where his main responsibilities were to oversee
SOPAF business in 8 countries across West Africa and
provide strategic/tactical direction to the various operating
companies. Since December 2011, he was appointed Chief
Operating Officer of vivo Energy.
Mr Dainhi holds an Engineering degree in electronics from
Ecole Nationale Supérieure d’Electronique et de Radio-
électricité’ (ENSERB): engineering school in Bordeaux
(France). In 1990, he completed a post-graduate degree
in international business management (specialisation in
marketing/sales management) - ‘Ecole des Hautes Etudes
Commerciales’ (EDHEC): business school in Lille (France)
In February 2012, Vivo Energy Mauritius Holdings BV bought
631,627 shares from minority shareholders and as a result,
holds 22,623,316 shares (77.15%) at the end of February 2012.
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report24
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 25
Mr Patrick Crighton, aged 52Executive Director and Finance Manager
Mr Antoine Delaporte, aged 51Independent and Non-Executive Director
Mr Roger Leung (aged 65) Independent and Non-Executive Director
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
Fellow of the Association of Chartered Certified Accountants, Mr Crighton joined
Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) in January 1987
as Management Accountant. Thereafter, from 1989 to 1993, he occupied the
position of Legal and Tax Accountant before taking over the position of Treasury
and Corporate Accountant up to 1995. He was then appointed Credit Manager and
in 1997 became a member of the JD Edwards team before being the Corporate
Accountant. In 2001, Mr Crighton was appointed Finance Manager. Mr Crighton
is also the holder of a Masters in Business Administration from Napier University.
On January 18, 2005, he was appointed a director of Shell Mauritius Limited (now
Vivo Energy Mauritius Limited) and since October 29, 2009, he is also a Director of
Societe Malgache des Petroles Vivo Energy (formerly Societe Malgache des Petroles
Shell).
Associate of the Chartered Institute of bankers in UK and a fellow member of the
Mauritius Institute of Directors, Mr Leung has been appointed a director of Vivo
Energy Mauritius Limited (formerly Shell Mauritius Limited) on June 30, 2006. He
retired from Barclays Bank in September 2005 as Regional Corporate Director. He
has been trustee of the Barclays Employees Pension Fund and a director of the
Barclays Leasing Company (Mauritius) Limited. Mr Leung is now a director of MDIT,
IPRO Fund Ltd and Bank One Limited. He presently works as Consultant in business
restructuring and performance optimisation.
Antoine Delaporte was appointed a director of Vivo Energy
Mauritius Limited (formerly Shell Mauritius Limited) on June
30, 2006. He is the founder and Managing Director of I&P
Management Limited, a private company managing private
equity funds in Africa. Since 2000, he is also Chairman of
the boards of Karina International Limited and of Karina SA
in Madagascar. Before that, Antoine was an entrepreneur in
Madagascar and he had been a manager at Bain & Co, a
leading strategic Consulting firm. Graduated of the ESCP-
Paris business school, he holds an MBA from INSEAD,
France. He is a member of the boards of Ciel Textile and
CEAL. He is also Chairman of the Boards of Newpack SA in
Madagascar, Grand Hotel du Louvre SA in Madagascar and
of C.B.E. Ngazidja in Comoro Islands.
2011 2010
0 – Rs 200,000 2 2
Between Rs 200,000 to Rs 1 m 1 1
Between Rs 1 m to Rs 3 m 0 0
Above Rs 3 m 2 2
During the year ended 31 December 2011, executive
directors received an aggregate amount of Rs 15,065,891
(2010 - Rs 9,969,097) as remuneration and benefits from
the Company. The non-executive directors received an
aggregate amount of Rs 759,751 (2010 - Rs 402,800) as
remuneration and benefits from the Company during the
same period. Out of the Rs. 15,065,891, Rs. 1,052,609 has
been claimed to Shell International.
Directors’ emoluments
Mr Pawan K Juwaheer, aged 48Managing Director and Vice-President
Indian Ocean Islands
Mr Juwaheer studied mechanical engineering at the University of Manchester
Institute of Science and Technology, UK. Joining the company in 1986, he has
occupied different positions across the business. He worked as Lubricants Sales
Technical Assistant, Consumer Sales Representative, Retail Planner and Supervisor
and Retail Sales Manager in Mauritius. He acquired experience working overseas as
Retail Visual Identity focal point and Retail Engineering Manager for Shell in Tunisia
and later as East Africa Retail Network Manager and Regional Retail Manager for
Shell East Africa based in Nairobi.
Mr Juwaheer was appointed Managing Director of Vivo Energy Mauritius Limited
(formerly Shell Mauritius Limited) in July 2006 and has since been a member of the
board. He is a Director on Energy Storage Company Limited and State Informatics
Limited boards and a former Chairperson of the Mauritius Chamber of Commerce
and Industry. Since March 2012, he is also a member of the Local Advisory Board
of Barclays Bank.
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report26
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 27
Profile of management team
The Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) management team is responsible
for supervising the general course of business of the company and advises the Board of directors.
The team comprises the Managing Director, Mr Pawan K Juwaheer, the Finance Manager, Mr Patrick
Crighton, and the following managers:
Mr Maurice Lionnet Distribution Manager
Mr Abhinesh DussainMarine and Aviation Manager
Mrs Nancy YoungCluster Human Resource Manager
Mr Eric HufouyeRetail Manager
Mr Rajanah DhaliahBusiness-to-Business Manager
Appointed Distribution Manager in August 2005, Maurice Lionnet joined Vivo Energy Mauritius
Limited, formerly Shell Mauritius Limited, in 1976. Mr Lionnet has held various senior positions
both locally and overseas in Supply & Distribution (Aviation, Terminal/Depot and Supplies),
Marketing (Retail, Commercial and LPG); At Shell Djibouti - Operations Manager from 1984
to 1986; At Shell Mauritius Limited - Retail and Commercial Manager, from 1986 to 1990,
then Supplies and Installation Manager, from 1990 to 1997 and subsequently, Team Leader for
the implementation of JD Edwards Logistics from 1997 to 1999; Marketing Manager for the
launch and setting up of the newly formed Shell Madagascar (SMPS) from 1999 to 2002; LPG
Manager for Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) from 2002 to
2006.
Maurice Lionnet is also Managing Director for ESCOL (Energy Storage Company Limited),
an associate company of Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited). He
holds a Masters Degree in Business Administration from the University of Surrey, UK, and is a
Member of the Society of Petroleum Engineers.
Mrs Young joined Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) in 1990
as Assistant to the Personnel and Services Manager. As from April 1999, she occupied the
position of Human Resources and Services Manager. In January 2005, Mrs Young was appointed
Cluster Human Resource Manager.
Before joining the company, she was a freelance consultant with Core Services Limited and
was involved in the job evaluation exercise for Air Mauritius. Mrs Young is a certified graduate
interviewer and assessor and a registered trainer in Human Resources Management. She holds
a Masters degree in Psychology with specialisation in Industrial Psychology from the University
of Bordeaux, France.
Holder of a Bachelor Tech in Civil Engineering from the Indian Institute of Technology, Bombay
and a Master of Science in e-Business from the University of Mauritius, Abhinesh Dussain joined
Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) in 2002 as Lubricants Sales
Engineer. In 2004, he was appointed Lubricants Business Manager. He managed the Lubricants
business for three years and in March 2007, he took over the Commercial Business as Fuels and
Bitumen Sales Manager. Beginning of 2009, Abhinesh was sent to Shell Botswana as Business-
to-Business Manager for an assignment and, after its completion, returned to Mauritius at the
end of 2009. Following short term assignment, in 2010, Mr Dussain took over the B2B role and
as well as the Marine and Aviation Manager for major part of the year. He was then appointed
full time Marine and Aviation Manager in 2011.
Holder of a postgraduate degree in Commerce, Management and Finance from Ecole
Supérieure de Commerce de Pau, France, Mr Hufouye joined Vivo Energy Mauritius Limited
(formerly Shell Mauritius Limited) as Retail Manager in October 2008. Before that, he has been
Project and Development Manager, Export Manager and Project Team Leader. Mr Hufouye
has strong experience in Project and Operations Management, ranging from business process
review to electronic payment systems development and implementation, both in Mauritius and
in the African region.
Mr Rajanah Dhaliah is holder of a degree in Mechanical Engineering and a Masters Degree
in Business Administration from the University of Mauritius. He joined Vivo Energy Mauritius
Limited (formerly Shell Mauritius Limited) in 1990 as Lubricants Sales Engineer. In 1995,
he acted as head of the Business Process Improvement Project for the company. He was
appointed LPG coordinator for Shell Gas Mauritius business from 1996 to 2000. He then
worked as Retail Manager for Mauritius from 2000 to 2004, and as such, formed part of the
Retail management team for East Africa.
After this, Mr Dhaliah became the Competence and Learning Manager for Africa and MECAS
(Middle East Central Asia South) for the Global Lubes Organisation until 2009. Mr Dhaliah
then became the B2C Marketing Manager for Commercial businesses within Africa until 2011.
He was appointed Business to Business Manager for Vivo Energy Mauritius Limited (formerly
Shell Mauritius Limited) in July 2011.
CORPORATE GOVERNANCE REPORT (CONTINUED)CORPORATE GOVERNANCE REPORT (CONTINUED)
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report28
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 29
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
Board meetings
The board meets on a regular basis and has a formal schedule
of matters reserved for it. This includes matters such as
approval of the Annual Report, approval of interim dividends
and recommendation of final dividends, approval of material
contracts and nomination of candidates for board membership.
The shareholders elect the board members each year at the
annual meeting. Each director is elected by a separate resolution
for a term of one year. The full list of matters reserved to the
board for decision is available from the Company Secretary.
Attendance of board meetings in 2011
In 2011, the attendance of the directors was as follows:
Constitution
The ARC, established by the Board of the company, shall
consist of at least two but not exceeding three Non-
executive Directors (NED). The Chairperson of the
committee shall be an independent NED (as defined by the
Code of Corporate Governance of Mauritius).
Each member shall be financially literate. At least one
member must have accounting or related financial expertise.
Members shall be appointed for two (2) years term of
notice so long as they remain a director of the company.
Audit committee members shall not serve simultaneously
on the audit committee of companies in the same field as
the present company and of more than two other public
companies without the approval of the full board.
Objectives
The audit committee shall assist the board in monitoring and
overseeing its financial responsibilities. Its main objectives
shall be to:
• oversee the integrity of the financial reporting process and
ensure the transparency and performance of published
financial information.
• review the effectiveness and performance of the
company’s internal financial control and risk management
system.
• evaluate the work of the internal audit function and of the
external auditors.
• review the company’s process compliance with legal and
regulatory requirements affecting financial reporting and,
if applicable, its code of business conduct.
The ARC committee will maintain effective working
relationships with the board of directors, management,
and the external and internal auditors. The duties and
responsibilities of a member of the audit committee are in
addition to those set out for a member of the board of
directors.
Meetings
Only committee members will attend meetings. A quorum of
any meeting shall be two (2) members. The audit committee
may invite such other persons (e.g. other directors, the
General Manager, head of finance, head of internal audit and
external audit senior partner) to its meetings, as it deems
necessary.
The external and internal auditors shall be invited to make
presentations to the audit committee as appropriate. At
least once a year, the committee shall meet with the head
of internal audit and senior partner of the external auditors
without the presence of executive management to discuss
any matters that either the committee or these two parties
believe should be discussed privately.
The committee shall meet as often as it determines necessary
or appropriate but not less frequently than quarterly.
The committee chairman shall convene a meeting upon
request of any committee member who considers it
necessary.
The secretary of the audit committee shall be the company
secretary, or such other person as nominated by the board.
The secretary of the committee shall circulate the minutes,
agenda, and background materials of meetings to the
Terms of Reference of Audit and Risk Committee (ARC)
Board committees
The Board has three standing committees made up of Executive
and Non-executive Directors to assist in the discharge of its
duties. The committees, which are set out below, meet regularly
under the terms of reference set by the board.
As from March 27, 2007 the Nomination and Remuneration
committee forms part of the Corporate Governance
committee.
Feb 17 Mar 25 May 13 Aug 11 Oct 13 Nov 11 Nov 22 Nov 30 Dec 02 Dec 16
2011 2011 2011 2011 2011 2011 2011 2011 2011 2011
Chairman
Mr Mamadou Sene X X X X X X
Managing Director
Mr Pawan Kumar Juwaheer X X X X X X X X X X
(Chairperson) (Chairperson) (Chairperson) (Chairperson) (Chairperson)
Directors
Mr Patrick Crighton X X X X X X X X X X
Mr Antoine Delaporte X X X X X X X X X
Mr Roger Leung X X X X X X X X X X
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report30
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 31
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
members of the committee and to the chairman of the
board at least a week before the meeting.
The background material must include all such management
accounts, financial statements, internal and external audit
reports and internal control evaluations that are available.
The chairman of the committee or another member of
the committee shall attend the board meeting at which the
financial statements are approved.
The committee should meet with in-house legal adviser on
a regular basis (if one is appointed). Meetings with outside
legal adviser should be held if it is deemed necessary.
Board authority
The board authorises the audit committee, within the scope
of its responsibilities to:
• Investigate any activity it deems appropriate,
• Appoint independent advisers and professionals
(accountants, lawyers and so on) as it deems necessary to
carry out its duties,
• Instruct any officer or employee of the company to
attend any meetings and provide pertinent information as
necessary and appropriate,
• Have unrestricted access to members of management,
employees and relevant information,
• Establish procedures for dealing with concern of
employees regarding accounting, internal controls and
auditing matters,
• Make recommendations to the board in relation to the
appointment, termination and remuneration of external
auditors and evaluate the work of the latter,
• Review the performance of the external auditors and
exercise final approval on the appointment or discharge
of the auditors; and
Key responsibility in respect of internal control
The committee shall:
• Discuss the internal controls, adhered to by the company’s
management, financial, accounting and internal audit
personnel,
• Discuss with management the company’s major risk
exposures and the steps management has taken to
monitor and control such exposures,
• Evaluate the overall effectiveness of the internal control
and risk management frameworks and consider whether
recommendations made by the internal and external
auditors have been implemented by management,
• Ensure that significant findings and recommendations
noted by the internal auditors and management’s
proposed response are discussed and appropriately acted
on; and
• Evaluate the internal control matrix of the company on
a quarterly basis and obtain management comments on
fluctuations in the score.
Key responsibility in respect of internal audit
The committee shall:
• Ensure that the company has an appropriate internal
audit function,
• Review the effectiveness of the internal audit function
and ensure that it has appropriate standing within the
company; and
• Evaluate the internal audit department and its impact on
the accounting practices internal controls and financial
reporting of the company.
Key responsibility in respect of external audit
The committee shall:
• Review on an annual basis the performance of the external
• pre-approve all audit services fees and terms as well as
review policies for the provision on non-audit services by
the external auditors.
The internal audit manager reports functionally to the
chairman of the audit committee (and administratively to
the General Manager).
Main responsibilities
The basic responsibility of the members of the audit
committee is to exercise their business judgment to act in
what they reasonably believe to be in the best interests of the
company and its shareholders. In discharging that obligation
members should be entitled to rely on the honesty and
integrity of the company senior executives and its outside
advisors and auditors, to the fullest extent permitted by law.
Key responsibility in respect of financial reporting
The committee shall:
• Review the interim financial statements, annual financial
statements and preliminary announcements prior to their
release,
• Meet with management internal auditors and the external
auditors to review the financial statements, the critical
accounting policies and practices, and the results of their
audit,
• Ensure that significant adjustments, unadjusted differences,
disagreements with management and management letter
are discussed with the external auditors; and
• Review the other sections of the annual report before
its release and consider whether the information is
understandable, consistent with members’ knowledge of
the company and unbiased.
auditors based on the scope and results of their work and
make recommendations to the board of the appointment,
reappointment or termination of the appointment of the
external auditors,
• Consider the independence and objectivity of the external
auditor.
• Discuss and review the external auditors’ proposed
audit scope, planning and approach in the light of the
company’s circumstances and changes in regulatory and
other requirements; and
• Ensure that significant findings, accounting adjustments
and recommendations noted by the external auditors
and management’s proposed response are discussed and
appropriately acted on.
Responsibility in respect of compliance with laws and regulations
The committee shall:
• Review the effectiveness of the system for monitoring
compliance with laws and regulations and the results
of management’s investigation and follow-up (including
disciplinary action) of any fraudulent acts or non-
compliance,
• Oversee the company’s compliance with legal and
regulatory provisions, its articles of association, code of
conduct, by-laws and any rules established by the board;
and
• Conduct and authorise investigations into any matters
within the audit committee’s scope of responsibilities.
Evaluating performance and reporting responsibilities
The committee shall:
• Assess the achievement of the duties specified in the
Terms of Reference of Audit and Risk Committee (ARC) Terms of Reference of Audit and Risk Committee (ARC)
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report32
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 33
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
charter annually and make regular report of their findings
to the board,
• Review and reassess the adequacy of its charter every
two (2) years and discuss any required changes with the
board; and
• Recommend approval of the annual report and accounts
to the board.
Corporate Governance committee (Remuneration and Nomination committee)
Mr Antoine Delaporte (Chairman)
Mr Pawan K Juwaheer
Mr Roger Leung
Audit and Risk Management committee
Mr Roger Leung (Chairman)
Mr Antoine Delaporte
The main attribution of the Corporate Governance
committee is to provide guidance to the Board on aspects
of Corporate Governance and to recommend the adoption
of policies and best practices as appropriate to the company.
The Corporate Governance committee is also responsible
for remuneration and nomination matters within the
company.
Terms of reference of the Nomination committee
The Nomination Committee (if separately constituted)
or the Corporate Governance committee that has
responsibility for board and senior executive nominations
should:
• Ascertain whether potential new directors are fit and
proper and are not disqualified from being directors.
Prior to their appointment, their backgrounds should be
investigated thoroughly;
• Ensure that the potential new director is fully cognisant of
what is expected from a director, in general, and from him
or her in particular ;
• Ensure that the right balance of skills, expertise and
independence is maintained;
• Ensure that there is a clearly defined and transparent
procedure for shareholders to recommend potential
candidates;
• Ensure that potential candidates are free from material
conflicts of interest and are not likely to simply act in the
interests of a major shareholder, substantial creditor or
significant supplier of the company. This is of particular
importance when a candidate has been nominated
by virtue of a shareholders’ agreement, or other such
agreement. In any case, candidates so nominated cannot
be considered independent (see Section 2, chapter 4,
clause 7).
• Ensure that those directors who, in the opinion of
the board, have either acted in accordance with the
instructions of a third party or have not discharged their
duties as directors to the satisfaction of the board, not be
nominated for re-election.
Terms of Reference of Audit and Risk Committee (ARC)
Terms of Reference of the Corporate Governance Committee
Mar 18, 2011 Nov 22, 2011
Chairman
Mr Antoine Delaporte X X
Directors
Mr Pawan Kumar Juwaheer X X
Mr Roger Leung X X
Mar 18, 2011 May 06, 2011 Aug 05, 2011 Nov 14, 2011
Chairman
Mr Roger Leung X X X X
Director
Mr Antoine Delaporte X X X X
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report34
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 35
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
Directors in joint venture
Energy Storage Company Limited
Vivo Energy Mauritius Limited (formerly Shell Mauritius Limited) holds 50% of the shares of Energy Storage Company Limited.
The Board directors of ESCOL and their attendance to the ESCOL board meeting in 2011 are as follows:
May 17, 2011 Nov 08, 2011
Chairman
Mr Bashirally A Currimjee X X
Directors
Mr Mamadou Sene (Mr Pawan Kumar Juwaheer as alternate) X
Mr Pawan Kumar Juwaheer X X
Mr Maurice Lionnet X X
Mr François Gauthier de Charnacé X X
Mr Jean Jacques Papee X X
People in Vivo Energy are critical to the achievement of
our business objectives. Vivo Energy compensation policies,
practices, and systems are intended to recognise and
support:
• Individual and business performance; both short and long
term;
• Vivo Energy core values, business principles and people
principles;
• Business and people strategies;
• Our strong commitment to sustainable development;
• Market competitiveness and the importance of internal
relationships; and
• Different business and country economic, social, legal, and
regulatory environments.
ObjectivesVivo Energy companies will operate performance, reward
and benefit systems that:
• Align employee and shareholder interests;
• Support the attraction and retention of the best talent at
all levels who fit our business needs;
• Assist mobility and avoid creating barriers to movement
within a business, country or Vivo Energy;
• Recognise both common interests and individual
preferences; and
• Are transparent and well explained
In addition to these shared objectives, the different elements
of the total compensation package focus on different,
although complementary, goals.
Performance and rewards• Differentiate on the basis of performance and value to
the business; and
• Encourage growth and development as individuals and
team players.
Benefits• Provide a standardised platform that allows other
elements of the reward strategy to differentiate on the
basis of performance;
• Are cost effective and tax advantaged, where Vivo Energy
purchasing power provides leverage over individual
purchasing power to provide for cost reduction and risk
sharing;
• Support long-term social objectives for the communities
within which we work;
• Recognise the legislative environments and competitive
markets within these environments; and
• Support sharing of responsibility between the state, the
employer and the employee.
StandardsAll reward and benefit programmes within any country
need to comply fully with appropriate laws and regulations,
Statement of General Business Principles, country Codes
of Conduct, and be market competitive. To determine the
latter, Vivo Energy has established:
Our competitive reference
To compare to representative employers in the industries
and communities in which we do business or where we
compete for talent.
Our competitive objective
To have pay and benefits that results in a strong market
position among the competitive reference group, which
enables us to attract and retain the best talent at all levels
that fit our business needs. The pay element within the total
mix is more important than benefits in our competitive
positioning.
Health, Safety, Security and Environment policies and practicesVivo Energy Mauritius Limited (formerly Shell Mauritius
Limited) operates under a common set of business
principles, supported by policies and business controls. These
include a Health, Safety, Security and Environment (HSSE)
Commitment and Policy, which require that our company
shall have a systematic approach to HSSE management. We
have put in place the Vivo Energy mandatory procedure
for an HSSE Management System (HSSE MS), which is a
structured set of controls for managing the business and
to ensure and demonstrate that business objectives are
met. This management system takes into account HSSE MS
implementation requirements, incorporated in the business
level HSSE MS as well as the various classes of business
HSSE MSs relevant to our operations. Classes of business
are distribution, marine, business-to-business, LPG and retail.
The elements of this management system are organised
Performance and reward policies should help people excel,
foster affiliation with Vivo Energy, and encourage behaviour
that leads to the achievement of business and personal
objectives.
Benefits that are provided or enabled by Vivo Energy
companies are another important component of the
employee value proposition and support our attraction
and retention strategies. Benefits that are common foster
affiliation and community spirit and offer a foundation for
the total compensation package.
Our pay and benefits philosophy, objectives and standards
apply to Vivo Energy companies that employ people on
Vivo Energy terms and conditions and should be broadly
communicated and understood by all.
Vivo Energy HR performance, rewards and benefits philosophy
-
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report36
Vivo Energy Mauritius Limited Annual Report 2011
Corporate Governance Report 37
CORPORATE GOVERNANCE REPORT (CONTINUED) CORPORATE GOVERNANCE REPORT (CONTINUED)
according to Vivo Energy guidance of how to integrate
HSSE into the business and manage HSSE matters as any
other critical activity. In line with our HSSE policy to achieve
continuous performance improvement, the individual classes
of business action plans have been well observed and
completed.
Policies and practice on ethics
Our approach to business integrity
Our commitment to business integrity is clear and
unequivocal; Vivo Energy Mauritius Limited (formerly Shell
Mauritius Limited) insists on honesty, integrity and fairness
in all aspects of our business and expects the same in our
relationships with all those with whom w