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Reliable
Effective
Innovative
Annual Report & Financial Statements
2012
CORPORATE Profile
The history of A.G. Leventis (Nigeria) Plc started when Chief
A. G. Leventis himself formed a trading company known as
A.G. Leventis & Company Limited in Ghana in 1937.
Originally, the main activities of the Company were
produce buying, importing and wholesaling of textile
goods.
Over the years, the Company expanded into various parts
of Nigeria investing in properties and also in general trade
and the sales and service of motor vehicles.
The Company later devolved into Leventis Motors Limited
(established in 1958), Leventis Stores Limited (1965),
Leventis Technical Limited (1972) whilst it retained
ownership of valuable freehold and leasehold property
throughout the country.
Under and by virtue of a series of Mergers and Schemes of
Arrangement, the afore-mentioned companies merged
with A. G. Leventis (Nigeria) Plc. and they were dissolved
and the Group acquired its current name.
At present, the Group has invested in several companies
and provides Secretarial Services, business and residential
and operates several divisions and accommodation subsidiaries
as follows:
Major Subsidiaries:Abuja (Capital) Motors Limited (Sales and service of vehicles),Cummins West Africa Limited (Sales and service of Cummins generators and engines),Leventis Foods Limited (producer of bread and pastries)Victoria Beach Hotel Limited (owner of Mainland Hotel in Ebute-Metta)Iddo Investments Limited (a property owning company)Druckfarben Nigeria Limited (producer and distributors of inks for flexible packaging)TCN Properties Limited (a property owing company)Guinea Construction Company Limited (a property owning company)
Divisions:Real Estate (Commercial and Residential accommodation)Leventis Motors (Sales and service of VW Eicher, Trucks & Buses, JCB Construction & Agriculture Equipment)Corporate Affairs.
The Group continues to seek avenues to invest in Nigeria thereby creating employment opportunities and contributing to the nation’s economy.
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1A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
ContentsTABLE OF
For over seven decades, A.G. Leventis (Nigeria) Plc has provided West Africa with reliable, innovative and affordable products and services. By focusing on such core markets as Power, FMCG, Logistics and Real Estate, A. G. Leventis has become one of the Major forces in Nigeria and beyond.
Group Financial Highlights2
Notice of Annual General Meeting
Chairman’s Statement
Report of the Independent Auditors
Directors, Officers and Advisers
Directors’ Report
19
3
4
12
23
24
11
14
27 Consolidated Statement of Financial Position
Consolidated Statement of Changes in Equity28
Consolidated Statement of Cash Flows29
Board of Directors
Corporate Governance Report
Audit Committee’s Report
18 Statement of Management Responsibilities
Consolidated Statement of Comprehensive Income26
Five-Year Group Financial Summary101
Consolidated Statement of Value Added 103
Electronic Delivery Mandate Form105
Additional Information104
E-dividend Mandate Form106
Proxy Form107
Five-Year Company Financial Summary102
Notes to the Financial Statements30
2A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
GROUP FINANCIAL
2012 2011
N'000 NN'000
Incr. %
2012 2011
'000 N N‘000 %
The Group The Company
Highlights
Incr.
Revenue 16,302,953 18,095,183 -10% 7,515,354 8,501,055 12%Profit before tax 652,846 823,532 -21% 1,598,041 1,130,437 41%Income tax expenses (368,677) (494,889) -26% (479,048) (420,087) 14%
Profit for the year 284,169 328,643 -14% 1,118,993 710,350 58%
Other comprehensive income, net of tax 30,700 15,085 104% 38,052 (14,554) +/-
Total comprehensive income attributable to:
Owners of the Company 767,631 564,401 36% 1,157,045 695,796 66%Non-controlling interest (452,762) (220,673) 105% - -
314,869 343,728 -8% 1,157,045 695,796 66%
Dividend 370,621 370,621 0% 370,621 370,621 0%
Total Equity 10,229,029 10,284,781 -1% 9,683,544 8,897,119 9%
Cash and cash equivalent (165,226) (106,428) -55% 1,061,661 561,169 89%
INFORMATION PER 50 KOBO ORDINARY SHARE KOBO KOBO KOBO KOBO
Earnings per share 28 21 33% 42 27 56%Net assets per share 386 389 -1% 366 336 9%
Number Number Number Number
Number of employees 1,469 1,482 -1% 731 728 0%
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3A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
NOTICE OF ANNUAL GENERAL MeetingFor The Year Ended 31 December 2012
Dividend Warrants
1. To lay before the meeting, the audited financial statements for the year ended December 31, 2012
and the Directors', Auditors' and Audit Committee's Reports thereon.
2. To elect/re-elect Directors retiring in accordance with the Company's Articles of Association.
3. To declare a dividend.
4. To authorise the Directors to fix the remuneration of the Auditors.
5. To elect/re-elect shareholders' representatives on the Audit Committee.
A member entitled to attend and vote at the General Meeting is entitled to appoint a proxy to attend and
vote instead of him. A proxy needs not be a member of the Company.
All instruments of proxy duly stamped by the Commissioner of Stamp Duties in accordance with the Stamp
Duties Act (CAP S8, LFN 2004) should be deposited with the Registrar at City Securities (Registrars) Limited,
358, Herbert Macauley Way, Yaba, Lagos not less than 48 hours before the time for holding the meeting.
BY ORDER OF THE BOARD
TEMIDAYO OLAOFE (MRS)
Company Secretary/Legal Adviser
IDDO HOUSE, IDDO, LAGOS
Dated this 27th day of March 2013
NOTICE IS ER Y GIVE hat t e 54th Ann al ner l Mee in o H EB N t h u Ge a t g f
. Le e ti (Nig ria lc i l e h ld at a nlan ot l ute-A. G v n s e ) P w l b e M i d H e , Eb
Me ta, Lagos on Tu sday, Jul 2 201 at 2.0 n on for het e y , 3 1 0 o t
follo ing urpose :w p s
If the payment of a dividend of 14k per share as
recommended by the Directors is approved, it is
intended that the warrants will be posted on July 3,
2013 to holders of eligible shares whose names appear
on the Register of Members on May 24, 2013.
4A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
CHAIRMAN’S Statement
Chief Joseph Babatunde Oke, OONExecutive Chairman
My vision is to pilot this
company to becoming a first
choice for investors from all over
the world wanting to do
business in Nigeria. Our
Business Development Division
has taken great strides in this
direction with three new
businesses on the verge of
actualisation. One of the
businesses is the assembly of
commercial vehicles, fabrication
of bottle carriers and petroleum
and water tankers. The other
businesses are distribution of
Plumbing and Industrial Pipes
and Fittings, and the mining of
minerals. The three businesses
are very promising and will
manifest during the 2013
financial year.
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5A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
CHAIRMAN’S Statement
Chiefs, Ladies and Gentlemen, it gives me great pleasure to welcome you to the 54th Annual General Meeting of our Company, and to present to you the financial statements for the year 2012.
ECONOMIC/BUSINESS ENVIRONMENT
The year started with a two-week
nationwide strike as a result of the decision
of the Federal Government to remove the
subsidy on petroleum products, especially
PMS and AGO.
This decision paralysed manufacturing
and sales operations in the country and
thus affecting our plans for the year. We
found ourselves still trying to catch-up
throughout the year.
Other factors that affected our operations
included threats to our well being by the
affliction of the Boko Haram insurgency,
the spate of assassinations and
kidnappings which were rampant
throughout the country, and the nation's
inadequate power supply.
The Banking reforms which commenced in
the previous year continued during the
period under review and this meant that
even though the Naira was relatively
stable, interest rates continued to grow,
thus affecting our cost of borrowing.
The issue of multiple taxation and
incessant levies from various tiers of
governments continued unabated despite
several promises made by the Federal
Government to streamline same. I wish to
seize this opportunity once again, to plead
with the different tiers of government to
coordinate and evolve a single but efficient
system of taxation which will benefit both
the Governments and the organised
private sector, as well as the public, our
final consumers.
The revenue of the Company and the
Group for the year under review was
N7.52 billion and N16.30 billion
respectively.
While Profit Before Tax for the Company
grew from N1.13 billion to N1.60 billion,
this was not the case for the Group as
some of the subsidiaries had to contend
with operational challenges which
impacted negatively on their results.
On a more positive note however, you
may recall that I had mentioned in my
statement of last year that we had a long
outstanding debt from National
Emergency Management Authority
(NEMA). I am pleased to inform you that
the debt has now been fully settled and
the provision made for it in our financial
statement last year has been reversed.
In my usual practice, I will now highlight
the activities of our various divisions and
subsidiaries and their contributions to
performance for the year under review.
Turnover was N6.30billion, a slight
reduction from the N7.33 billion that was
realised last year.
OPERATING RESULTS
LEVENTIS MOTORS DIVISION
The revenue of the Company and the Group for the year under review was N7.52 billion and N16.30 billion respectively.
While Profit Before Tax for the Company grew from N1.13 billion to N1.60 billion, this was not the case for the Group as some of the subsidiaries had to contend with operational challenges which impacted negatively on their results.
6A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
CHAIRMAN’S Statement
Although the division witnessed increases
in some aspects of its operation especially
in the sales of construction equipment and
the haulage services, there were reduced
sales of commercial vehicles. This was a
direct consequence of the economic
climate prevailing at the time, as well as
the significantly higher costs of these
trucks which the market was not willing to
accept.
Nevertheless, in order to provide a
complete range of commercial vehicles to
our customers, the division added a lower
priced brand of Eicher trucks to its
portfolio. This new business, it is hoped,
along with other brands being added
currently, will add significantly to both
turnover and profit.
The result of this division increased from
N1.02 billion to 1.06 billion, an increase
of 4% over last year.
The division improved upon its results for
the prior year through increased
occupancy levels in some of our residential
p rope r t i e s i n p r ime l o ca t i on s .
Furthermore, with increased borrowing
rates, the division also benefitted from
enhanced interest on its bank deposits.
The property in Ikoyi is nearing completion
and would be commissioned and
occupied before the end of the current
financial year.
In the meantime, the division continues to
study the real estate business in Nigeria,
with a view to rationalising its property
portfolio throughout the country with the
REAL ESTATE DIVISION
N
aim of redeveloping some and disposal of
others that are not viable. Plans are also at
advance stage to acquire new properties for
the development of residential and
commercial estates in some prime locations
in the country.
The results of this subsidiary were
disappointing, having been unable to
achieve its targets for the year. Turnover
declined from N6.05 billion to N5.20
billion. Profits also fell considerably.
The Board of Directors has studied the
problems that has beset the company over
the past two years and have come up with a
plan of action that will boost performance
and improve results. Our Technical Partner,
Cummins Inc. of USA have assured us that
the plans that have been formulated by the
Board will be supported by them and that
plans for the development of the Africa
market with Nigeria being in the core of
their business worldwide will continue.
The turnover of this subsidiary was flat
against its achievement in the previous year.
In view of the huge loss incurred again this
year, the Board decided to restructure its
entire operation and consequently closed
down the Abuja factory as the cost of
running the business there had become
uneconomical.
Even though higher sales were recorded in
the bakery section, the increased cost of
borrowing and interest payments eroded
the gains made.
CUMMINS WEST AFRICA LIMITED
LEVENTIS FOODS LIMITED
The division improved upon its results for the prior year through increased occupancy levels in some of our residential properties in prime locations. Furthermore, with increased borrowing rates, the division also benefitted from enhanced interest on its bank deposits.
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7A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
CHAIRMAN’S Statement
The Directors are considering various
options to improve performance in order
to remain relevant in this sector,
including additional cost reduction
options.
Mainland Hotel, owned by this
subsidiary, recorded sales of N361.11
million compared with N323.77 million
achieved in the previous year. Profit
before tax was N62.35 million against
N26.24 million in 2011.
There are plans to upgrade some of its
facilities like the website which will make
it more accessible to both national and
international customers. It is also
planned to install a close circuit television
(CCTV) within the premises to ensure
security of life and property and also
complete the refurbishment and
upgrading of all the rooms, these
actions, we expect, will translate into
increased patronage and profitability.
This subsidiary that was incorporated
last year and carrying on the business of
distribution of printing inks, is still
studying and getting used to the
peculiarities of the market. Sales
improved from N337.67 million in the six
months of the prior year to N668.59
million this year. Profit before tax
however, dipped slightly from N64.76
million last year to N62.51 million. The
Board of Directors is seeking new ways to
expand the business and I hope to give
you more details of our new direction in
the near future.
VICTORIA BEACH HOTEL LIMITED
DRUCKFARBEN NIGERIA LIMITED
ABUJA (CAPITAL) MOTORS LIMITED
DIVIDEND
The turnover for Abuja (Capital) Motors
Limited was N122.69 million which was
11% lower than what was achieved in
prior year. The company also recorded a
loss of N14.23 million for the year under
review. Even though there had been
attempts to expand the business beyond
the Federal Capital Territory, its efforts had
been hampered by the insecurity that was
predominant in the northern part of the
country. It is hoped that the situation will
improve in the coming year in view of the
action now embarked upon by the
Federal Government to improve security
throughout the country.
Despite the harsh economic climate
under which we operated in the year
under review, the total income
attributable to shareholders after
minority interest grew by 31% to N734.2
million. Given this, the Board is pleased
to recommend a dividend payout of 14
kobo per share, representing a total of
N370.60 million payable to shareholders
net of withholding tax at the appropriate
rate.
You may recall that last year, we had
printed e-dividend forms in the Annual
Report and you had been requested to
complete them and pass them on to the
Registrar. Unfortunately, the response
had been very disappointing and I wish to
implore you once again, to complete the
forms and return them as it would mean a
quicker receipt of dividends paid and thus
reducing the number of unclaimed
dividends.
Although the division (Leventis Motors) witnessed increases in some aspects of its operation especially in the sales of construction equipment and the haulage services, there were reduced sales of commercial vehicles.
8A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
CHAIRMAN’S Statement
REGISTRARS
CODE OF CORPORATE GOVERNANCE
BOARD OF DIRECTORS
Again you must have noticed that we have
new Registrars, City Securities (Registrars)
Limited; this is as a result of the acquisition
of Fin Registrars Limited by City Securities
Limited, a direct consequence of the take-
over of Finbank Plc by First City Monument
Bank Plc.
We welcome the new Registrars to A. G.
Leventis (Nigeria) Plc and express the
sincere hope that they will serve us without
any complaints.
We continue to strive to follow the Code of
Corporate Governance as can be seen in
the Corporate Governance report included
in this Annual Report/Financial statements.
As an addition to what has been included, I
would like to inform you that the Human
Resources and Remuneration Committee
of the Board has been reconstituted to
include three non Executive Directors. This
is to ensure the independence of its
d e l i b e r a t i o n s , d e c i s i o n s a n d
recommendations to the Board. The
committee's immediate assignment is to
review the existing Human Resources and
Remuneration policies and procedures of
the company.
Furthermore, as already included in the
Directors' report, I shall retire from
Executive Management of the Group after
this meeting, but will continue as
Chairman in a non Executive capacity.
Mr. Charis Katsaras, our Business
Development Director resigned from the
Board with effect from May 1, 2013. Mr.
Katsaras was an enthusiastic and loyal
member of the Board, who also served as
the Finance Director before holding his last
position.
Mr. A. P. Leventis CBE, OFR also retired from
the Board, having served continuously since
April, 1977. We have benefited immensely
from his insightful thoughts and knowledge
of international business practices.
On your behalf, I wish to thank them both
for their services and wish them success in
their future endeavours.
Messrs. Suleman Abubakar, Kola Karim and
Michail Oikonomakis were appointed
directors after the last Annual General
Meeting.
Mr. Suleman Abubakar is the Managing
Director/Chief Executive Officer of Imani
Group of Companies, one of the oldest
indigenous real estate companies in Nigeria.
He is also the current Vice President of the
Real Estate Developers Association of
Nigeria.
Mr. Kola Karim is the Group Managing
Director/Chief Executive of Shoreline Energy
International Limited and sits on several
other Boards which include Ecobank Nigeria
Plc, The Nigerian Ropes Plc and Costain West
Africa Plc.
Mr. Michail Oikonomakis brings to the Board
a wealth of experience garnered from the
Bottling and Food production industries in
Greece.
We continue to strive to follow the Code of Corporate Governance as can be seen in the Corporate Governance report included in this Annual Report/financial statements. As an addition to what has been included, I would like to inform you that the Human Resources and Remuneration Committee of the board has been reconstituted to include three non Executive Directors
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9A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
CHAIRMAN’S Statement
The three directors will retire at this Annual
General Meeting and being eligible will seek
election.
In the realisation that our staff constitutes the key
and vital ingredient to the growth and success of
our organisation, we embarked upon a rigorous
training regime during the year. This is in an
attempt to shift the mindset of staff from a
reactionary point of view to a more proactive
manner of taking action.
We appreciate both Management and Staff for
their contributions to the results achieved this
year with the hope that they will remain
dedicated, loyal and focussed for even better
results in the years to come.
My vision is to pilot this company to becoming a
first choice for investors from all over the world
wanting to do business in Nigeria. Our Business
Development Division has taken great strides in
this direction with three new businesses on the
verge of actualization. One of the businesses is
the assembly of commercial vehicles, fabrication
of bottle carriers and petroleum and water
tankers. The other businesses are distribution of
Plumbing and Industrial Pipes and Fittings, and
the mining of minerals. The three businesses are
very promising and will manifest during the 2013
financial year.
I am pleased to inform Shareholders that the first
quarter of the current year has shown greater
promise and barr ing any unforeseen
circumstances, the end result will show a
remarkable improvement over the year under
review.
MANAGEMENT AND STAFF
FUTURE PROSPECTS
CONCLUSION
Finally, I wish to express my appreciation to
my colleagues on the Board both old and
new, for their contributions, cooperation
and efforts to improve the Company's
businesses.
It would be an oversight not to mention the
support received from all our Technical
Partners in ensuring the sustenance and
growth of their own line of business within
the Group.
I also must appreciate our dear Shareholders
and Customers for the i r loya l ty,
encouragement and steadfastness.
Thank you all and God bless.
Chief Joseph Babatunde Oke, OON.Executive Chairman
I am pleased to inform Shareholders that the first quarter of the current year has shown greater promise and barring any unforeseen circumstances, the end result will show a remarkable improvement over the year under review.
OURDirectors
A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t 10
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11A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
DIRECTORS:
SECRETARY:
REGISTERED OFFICE:
REGISTRAR AND TRANSFER OFFICE:
AUDITORS:
Chief Joseph Babatunde Oke, OON - Executive Chairman
Arthur Bourekas (Australian) - Group Managing Director
Charalambos Katsaras (Cypriot) - Group Business Development Director
(Resigned w.e.f 1/5/2013)
Prince Ademola Adetona - (Retired w.e.f. 7/5/12)
Suleman Abubakar - (Appointed w.e.f 13/9/12)
Haralambos George David (Cypriot)
Orikolade Adebayo Karim - (Appointed w.e.f. 6/12/12)
Anastasios Ioannis Leventis (British)
Anastasios Paul Leventis, CBE, OFR (British) - (Retired w.e.f. 13/9/12)
Kenny Ezenwani Odogwu
Michail Oikonomakis (Greek) - (Appointed w.e.f. 6/12/12)
Temidayo Olaofe (Mrs)
Iddo House, Iddo, P O Box 159, Lagos
City Securities (Registrars) Limited
358, Herbert Macauley Way
Yaba, Lagos
Akintola Williams Deloitte
(Chartered Accountants)
235 Ikorodu Road
Ilupeju
Lagos
DIRECTORS, OFFICERS & ADVISERS
BOARD OF Directors
Anastasi s Ioannis Le entis (Bri ish)
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14A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
DIRECTORS’ REPORT
The Directors present to the members of the Company, the Annual Report together with the audited statement of financial position as at 31 December 2012.
The principal activities of the Group continued to be:
· Sales and Servicing of: passenger cars, commercial vehicles, agricultural, mining, construction and other industrial machinery, including engine rebuilds.
· Real Estate: Property development and management.· The Provision of: administrative, management and other specialised services to subsidiary, associated and
related companies.· Production and distribution of bakery and pastry products.· Hospitality services.· The assembly, sale and servicing of power generation equipment and other high horsepower engines,
including overhauls.· The manufacture and sales of flexography and rotogravure inks for flexible packaging products and paints.
The Financial Statements of the Company were prepared in accordance with International Financial Reporting Standards (IFRS) for the first time in 2012. In preparing them the Company had to adjust figures previously reported under the Statements of Accounting Standards issued by the Nigerian Accounting Standards Board (Nigerian GAAP). Explanations on how the transition from Nigerian GAAP to IFRS has affected the Company's statement of financial position (Balance Sheet), financial performance (Profit and Loss) and cash flows are set out in the tables and notes to these Financial Statements.
The major areas of such impact for the Company are the format of presentation and disclosures, investment properties valuation and disposals, accounting for property, plant and equipment, employee benefits, lease and borrowing costs, etc. The conversion to IFRS is expected to bring the Company's reporting standards and systems in uniformity with other companies, domestic or global, where IFRS are in use and will allow the Company to streamline its operations, reporting and auditing standards, training and development.
The performance of the Group during the year under review as compared with the previous year is as stated below:
PRINCIPAL ACTIVITIES
RESULTS FOR THE YEAR
31, 2011
N’000
December 31, 2012 N’000
734,252
December
Turnover 16,302,953 18,095,183 Profit before taxation and non-controlling interest 652,846 823,532Taxation (368,677) (494,889) Profit after taxation 284,169 328,643Non-controlling interest 450,083 233,585 Profit after tax and non-controlling interest 562,228
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For The Year Ended 31 December 2012 (Continued)
DIRECTORS’ REPORT
DIVIDEND
N'000
DIRECTORS
RECORD OF DIRECTORS' ATTENDANCE
INTERESTS OF DIRECTORS
The Directors recommend to the shareholders, the payment of a gross dividend of N370,620,643.70 that is, 14 Kobo per share payable to Shareholders on the Company's Register of Members at 24 May 2013. The dividend is subject to the deduction of appropriate withholding tax. If members at the Annual General Meeting approve this recommendation, the appropriation of the profit as at the end of the financial year would be as follows:
Proposed Dividend 370,621Retained Profit at the end of the year 748,372
Prince Ademola Adetona and Mr. Anastasios Paul Leventis, CBE, OFR, retired after the last Annual General Meeting.
Mr. Charalambos Katsaras has indicated his intention to resign from the Board on May 1, 2013.
Mr. Suleman Abubakar, Mr. Michail Oikonomakis and Mr. Orikolade Karim were appointed Directors after the last Annual General Meeting. They will retire at this Annual General Meeting, and being eligible, seek election.
The Director retiring by rotation and seeking re-election is Chief Joseph Babatunde Oke, OON.
Special Notice is hereby given in accordance with Section 256 of the Companies and Allied Matters Act, CAP C20 LFN 2004, in respect of the re-election of Chief Joseph Babatunde Oke, OON, who attained the age of Seventy (70) Years in 2012.
Chief Oke will also retire from Executive Management of the Company after this Annual General Meeting.
In accordance with Section 258(2) of the Companies and Allied Matters Act, CAP C20 LFN 2004, the records of Directors' attendance at Board meetings during the year under review will be available for inspection at the Annual General Meeting.
Directors' interests in the issued share capital of the Company as recorded in the Register of Members and/or as notified by the Directors in compliance with Sections 275 and 276 of the Companies and Allied Matters Act, CAP C20, LFN 2004 and the Listing Requirements of the Nigerian Stock Exchange were as follows:
15A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
No. of Shares At
January 1, 2012
- -
December 31, 2012
Chief Joseph Babatunde Oke, OON 4,000,000 3,000,000
Arthur Bourekas 1,014,069 334,069
Prince A. Adetona (Retired w. e. f. 07.05.2012) 4,803,646 4,803,646
Suleman Abubakar (Appointed w. e. f. 13.09.2012) - -
Haralambos George David 3,487,059 3,160,059
Orikolade Adebayo Karim (Appointed w. e. f. 06.12.2012) - -
Charalambos Katsaras (Retired w. e. f. 01.05.2013) 1,370,915 548,444
A. P. Leventis, CBE, OFR (Retired w. e. f. 13.09.2012) 4,791,847 722
Anastasios Ioannis Leventis 876,000 876,000
Kenny Ezenwani Odogwu 768 768
Michail Oikonomakis (Appointed w. e. f. 06.12.2012)
Other than as disclosed above, the Directors are not aware of any disclosable interests or transactions in the share capital of the Company or any of its subsidiaries as at December 31, 2012 or at the date of this report.
16A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (Continued)
DIRECTORS’ REPORT
DIRECTOR'S INTERESTS IN CONTRACTS
DONATIONS
CORPORATE SOCIAL RESPONSIBILITY (CSR)
CSR Activities and Highlights
None of the Directors have notified the Company for the purpose of Section 277 of the Companies and Allied Matters Act, CAP C20 LFN 2004 of any disclosable interests in contracts in which the Company was involved during the year ended 31 December 2012 or up to the date of this report.
The Company made a donation of N1,200,000.00 to Manufacturers Association of Nigeria and N160,000.00 to the National Conservation Foundation, during the year under review.
Our Corporate Social Responsibility integrates social, environmental and economic concerns into the Group's values, culture, decision making, strategy and operations in a transparent and accountable manner and thus, establishes better practices within the Group, creates wealth and improves the society at large. We aim at enriching the lives of our employees and the Community at large and to this end, we provide support for our communities along the lines of our branded theme of “Enriching Lives”, through activities that focus on the active and continuous community involvement, development and investment with particular emphasis on:
. Education
. Social Welfare; through corporate philanthropy and employee volunteerism.
The Key Benefits of our corporate social responsibility are:
. Improved reputation management
. Enhanced ability to recruit, develop and retain staff
. Improved innovation, competitiveness and market positioning
. Enhanced ability to address change
. More robust “social license” to operate in the community
In conjunction with our communities, the state government and non-governmental organisations (NGOs), we directed our investment towards the actualisation of the following activities;
1. Leadership, Ethics and Civics (LEC) Programme
The Leadership, Ethics and Civics (LEC) Training Programme is an extracurricular programme for selected SS1 students in two secondary schools – Randle Senior High School (Apapa) and Birrel Avenue Senior High School (Yaba). The programme will be delivered through LEAP Africa, a non-profit organisation, which is committed to inspiring, empowering and equipping a new cadre of African leaders.
The LEC Programme is modelled after international best practices and emerging lessons from Ford Foundation's youth leadership efforts across the globe. The objectives of the programme are to primarily expose youth to the concept of leadership and to encourage them to apply those skills in implementing change projects in their communities.
As part of the Company's pilot programme, thirty selected students from each of the schools mentioned above will be trained on the LEC curriculum over one academic term. The students will receive grants from A.G. Leventis (Nigeria) Plc. to support their change projects. LEAP will also provide on-going support through its staff and youth volunteers who will assist these students on their project implementation.
At the end of the programme, A.G. Leventis (Nigeria) Plc. along with LEAP will celebrate the best student project, and award certificates to students who complete the entire curriculum.
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2.
Other CSR projects within the Group included:. Visit to the Heart of Gold Hospice / Re-visit to the Heart of Gold Hospice with a . donation of a washing machine;. Cleaning exercise at Oyingbo Market;. Cleaning / donations at Ijora Health Center;. Visit to the Lady Mechanic Initiative;. Mentoring and Cleaning exercise at the Government Technical College, Port Harcourt.
It is the Company's policy to give special consideration to disabled persons having regard to the individualapplicant's aptitudes and abilities.
At the end of the year, the Company commenced an insurance health care scheme with HYGEIA, a Health Maintenance Organisation (HMO), licensed by the National Health Insurance Scheme (NHIS) to provide health insurance to employees in the private sector. Through this arrangement, each employee, their respective spouses, and dependents below the age of eighteen (18) years are entitled to medical treatment in well-equipped, qualitative network of hospitals under the scheme.
The Company runs canteens for junior and management employees where meals are heavily subsidised.
Safety regulations are in place within the Company's premises and employees are regularly informed of theregulations.
There are contributory retirement benefit schemes for both management and junior employees of the Company inconformity with the Pensions Reform Act 2004.
The Company has an effective employer/employee communication system aimed at enhancing industrial harmony. Employees are kept as fully informed as practicable of the Company's activities which particularly affect them as employees and are also encouraged to communicate any information useful to management through use of suggestion boxes and other channels.
Regular training programs are usually arranged for employees locally and where applicable, overseas for theimprovement of skills and enhancement of career prospects.
In the opinion of the Directors, the market value of the Company's fixed assets is not less than as shown in thestatement of financial positions.
Messrs. Akintola Williams Deloitte, having indicated their willingness, will continue in office as the Company'sAuditors in accordance with Section 357 (2) of the Companies and Allied Matters Act, CAP C20, LFN 2004.
Projects
EMPLOYMENT OF DISABLED PERSONS
HEALTH, SAFETY AND WELFARE OF EMPLOYEES
EMPLOYEES' INVOLVEMENT AND TRAINING
FIXED ASSETS
AUDITORS
BY ORDER OF THE BOARD
TEMIDAYO OLAOFE (MRS)Company Secretary/Legal AdviserFRC No: FRC/2013/ICSAN/00000002145
IDDO HOUSE, IDDO, LAGOS
For The Year Ended 31 December 2012 (Continued)
DIRECTORS’ REPORT
18A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
STATEMENT OF MANAGEMENT RESPONSIBILITIES FOR THE PREPARATION AND APPROVAL OF THE FINANCIAL STATEMENTS
The Directors of A.G. Leventis (Nigeria) Plc are responsible for the preparation of the consolidated and separate financial statements that present fairly the financial position of the Company and its subsidiaries ("the Group") as at 31 December 2012, and the results of its operations, cash flows and changes in equity for the year then ended, in compliance with International Financial Reporting Standards ("IFRS"), and in the manner required by the Companies and Allied Matters Act of Nigeria and the Financial Reporting Council of Nigeria Act, 2011.
. properly selecting and applying accounting policies;
. presenting information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
. providing additional disclosures when compliance with the specific requirements in IFRSs are insufficient, to enable users understand the impact of particular transactions, and conditions on the Company's consolidated and separate financial position and financial performance; and
. making an assessment of the Group's ability to continue as a going concern.
. designing, implementing and maintaining an effective and sound system of internal controls throughout the Company;
. maintaining adequate accounting records that are sufficient to show and explain the Group's transactions and disclose with reasonable accuracy at any time the consolidated financial position of the Company, and which enable them to ensure that the financial statements of the Company comply with IFRS;
. maintaining statutory accounting records in compliance with the legislation of Nigeria and IFRS;
. taking such steps as are reasonably available to them to safeguard the assets of the Company; and
. preventing and detecting fraud and other irregularities.
The consolidated and separate financial statements of the Group for the year ended 31 December 2012 were approved by Management on 27 March 2013.
Signed on behalf of Management of the Company
Chairman Group Managing DirectorFRC no: FRC/2013/NIM/00000002128 FRC no: FRC/2013/MANUN/00000002147
Group Finance DirectorFRC no: FRC/2013/ICAN/00000002031
In preparing the financial statements, the Directors are responsible for:
The Directors are responsible for:
Chief Joseph Babatunde Oke, OON Mr. Arthur Bourekas
Mr. Oleg Buchak
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19A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
CORPORATE GOVERNANCE REPORT
A G LEVENTIS (NIGERIA) PLC is committed to the best practices in corporate governance; hence the Board is continually reviewing corporate governance standards and procedures in the light of the current developments in and outside Nigeria. It recognizes that corporate governance is fundamental to earning the confidence and trust of the shareholders and consequently provides the structure through which the objectives of the Company are set and the means of attaining such objectives.
The Board is guided in their Corporate Governance policies by the provisions of the Code of Corporate Governance (“the Code”) which came into effect on April 1, 2011 and their policies are designed to ensure that the Company's business is conducted in a fair and transparent manner which conforms to high ethical standards. The governance framework helps the Board to discharge its roles of providing oversight and strategic counsel in balance with their responsibility to ensure conformity with regulatory requirements and acceptable risk.
In compliance with Section 34(4) of the Code, it is hereby reported as follows:
The Directors of the Company are professionals who are well established in various fields of endeavor such as Engineering, Accountancy, Marketing, Administration, Business, Law, Economics etc., creating a good skills- mix and wealth of experience which they have brought to bear on deliberations at Board meetings and in the exercise of their oversight functions.
The Board governs and supervises the overall activities of the Company through the Group Managing Director.
The composition of the Board of Directors of the Company is as follows:
THE BOARD OF DIRECTORS
COMPOSITION OF THE BOARD OF DIRECTORS
THE ROLES OF THE BOARD OF DIRECTORSThe Directors are in the process of formalizing a Charter and a Code of Business Ethics for the Group.The Charter provides for the following as the roles and responsibilities of the Board of Directors:
· Strategy and Planning
· Staffing at Board and Senior Management Levels & Succession Planning
· Executive Remuneration
· Performance Monitoring
· Risk Management and Internal Control
· Audit and Compliance
· Capital Management and Financial Reporting
· Communication with the shareholders and management of investor relations
· Board and its Committees' accountabilities and responsibilities
Executive/ Non-Executive/ Date of Title Name Independent Appointment
Chairman Chief Joseph Babatunde Oke, OON Executive 4/2/1994
Managing Director Arthur Bourekas (Australian) Executive 9/4/2008
Director Charalambos Katsaras (Cypriot) Executive 9/4/2008 -1/5/2013
Director Anastasios Ioannis Leventis (British) Non-Executive 15/4/2010
Director Haralambos George David (Cypriot) Non-Executive 30/5/2000
Director Michail Oikonomakis (Greek) Executive 6/12/2012
Director Suleman Abubakar Non-Executive 13/9/2012
Director Orikolade Karim Non-Executive 6/12/2012
Director Kenny Ezenwani Odogwu Independent 20/6/2011
For The Year Ended 31 December 2012
The Board is alive to its responsibilities which primarily involves the creation of stakeholder value and ensuring the
success of the Company. The Board is responsible for ensuring that the affairs of the Company are run in an efficient
manner and in compliance with applicable regulations. Members of the Board are required at all times to act in the best
interest of the Company in the articulation and formulation of its strategic direction. The Board of Directors is dedicated
to ensuring that the Company achieves its objectives. The Board met four (4) times during the year on the following
days: 27 March, 2012, 5 July, 2012, 13 September, 2012 and 6 December, 2012
The Board carries out some of their responsibilities through two committees whose terms of reference clearly sets out their roles, responsibilities, scope of authority and procedure for reporting to the Board. The Committees are Executive Committee and Human Resources & Remuneration Committee.
The Executive Committee met on 17 February, 2012, 3 July, 2012, 12 September, 2012 and 6 December, 2012 while the Human Resources and Remuneration Committee met on 6 September, 2012
The following is the list of the directors and their attendance at Board and Committees meetings during the year:
BOARD COMMITTEES
ATTENDANCE AT MEETINGS BY DIRECTORS
20A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
CORPORATE GOVERNANCE REPORT
Board Executive Committee Resource and Committee
Remuneration
Number of Meetings 4 4 1 4
Chief Joseph Babatunde Oke, OON 4 4 1 N/A
Arthur Bourekas 3 4 1 3
Ademola Adetona
(retired w.e.f 05.07.2012) 2 N/A N/A 2
Haralambos George David 3 4 N/A N/A
Charalambos Katsaras
(resigned w.e.f 01.05.2013) 4 3 N/A 4
Anastasios Ioannis Leventis 2 N/A N/A N/A
Anastasios Paul Leventis, CBE, OFR
(retired w.e.f 13.9.2012) - N/A N/A N/A
Kenny Ezenwani Odogwu 3 N/A N/A N/A
Michail Oikonomakis
(appointed w.e.f 06.12.2012) N/A N/A N/A
Suleman Abubakar
(appointed w.e.f 13.9.2012) 1 N/A N/A N/A
Orikolade Karim
(appointed w.e.f 06.12.2012) N/A N/A N/A
Human Audit
Mr. Suleman Abubakar, Mr. Michail Oikonomakis and Mr. Orikolade Karim were appointed Directors after the last Annual General Meeting. They will retire at this Annual General Meeting, and being eligible, seek election. The Director retiring by rotation and seeking re-election is Chief Joseph Babatunde Oke, OON.
For The Year Ended 31 December 2012 (Continued)
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CORPORATE GOVERNANCE REPORT
21A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Biographical details of Directors seeking election/re-election are as stated below:
thMr. Michail Oikonomakis was appointed on the Board on 6 December, 2012. He started his career 33 (thirty three) years ago in Coca Cola Hellenic where he rose to the position of General Manager for all Mainland Greece operations of CCH. He was also a Managing Director in several other companies. Mr. Oikonomakis is a member of the Board of Directors and member of the Executive Committee of Leventis Foods Limited. In addition, he is a member of the Board of Directors of GNCCT (Greek-Nigerian Chamber of Commerce and Technology) and a member of the Advisory Board of CEO Association Greece.
thMr. Orikolade Karim was appointed on the Board on 6 December, 2012. He has good entrepreneurial skills and his current portfolios of businesses are in the construction, commodity trading, agro-allied products, oil and gas, engineering and power sectors. He is the Group Managing Director/CEO Shoreline Energy International Limited (a leading energy and infrastructure company focused on Africa). He is the Chairman of Costain West Africa Plc. and Nigerian Ropes Plc. He is also a member of the board of directors of Ecobank Nigeria Plc.
Mr. Suleman Abubakar holds a Bachelor's degree in Management from Eckerd College, Saint Petersburg and an MBA in International Finance from American University, Washington. He is MD/C.E.O. of Imani Group of Companies one of the oldest indigenous real estate companies in Nigeria. Mr. Suleman Abubakar is a member of the Fiscal Responsibility Commission. He is also the current Vice President of Real Estate Developers Association.
Chief J. B Oke became the Executive Chairman of the Company with effect from June 18, 2009 on the retirement of the former chairman. He had served the Leventis Group in various management capacities before his appointment. He joined the Board of the Company in February 1994. He is also on the Board of some other companies within the Leventis Group.
The Audit Committee is composed of six (6) members made up of three representatives of the shareholders elected at the 2011 Annual General Meeting for a tenure of one year, and three representatives of the Board of Directors nominated by the Board. The Chairman of the Committee, Otunba Adedotun Odunuga is a shareholders' representative. The Committee met four times in the year on the following days: January 23, 2012, March 4, 2012, October 23, 2012 and November 13, 2012.
1) Otunba Adedotun Odunuga - Shareholder/Chairman 4/4
2) Prince Ademola Adetona
(retired w.e.f 05.07.2012) - Director/Member 2/4
3) Mr. Arthur Bourekas - Director/Member 3/4
4) Mr. Charalambos Katsaras - Director/Member 4/4
5) Mr. Rasak Mumuni - Shareholder/Member 4/4
6) Miss Christie O. Vincent - Shareholder/Member 4/4
7) Mr. Kenny E. Odogwu
(appointed w.e.f 05.07.2012) - Director/Member 0/4
MR. MICHAIL OIKONOMAKIS
MR. ORIKOLADE KARIM
MR. SULEMAN ABUBAKAR
CHIEF JOSEPH BABATUNDE OKE, OON
THE AUDIT COMMITTEE
Composition Category Attendance
For The Year Ended 31 December 2012 (Continued)
22A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
In 2012 the Audit Committee:
COMMUNICATION POLICY
PRINTED MATERIAL
TRANSPARENCY IN FINANCIAL REPORTING AND INTERNAL CONTROL
WHISTLE BLOWING POLICY
CONCLUSION
· Reviewed the results of the audits undertaken by the Internal Audit and considered the adequacy of management's responses to the matters raised, including the implementation of any recommendations made.
· Reviewed and approved the 2013 Internal Audit programme, including the proposed audit approach, coverage and allocation of resources.
· Reviewed the effectiveness of Internal Audit, taking into account the views of directors and senior management on matters such as independence, proficiency, resourcing, and audit strategy, planning and methodology.
· Reviewed regular reports on control issues of Company level significance, including details of any remedial action being taken. It considered reports from the Internal and external auditors on the Company's systems of internal control and reported to the Board on the results of its review.
The Company is committed to managing an open and consistent communication policy with shareholders, potential investors and other interested parties. The objective is to ensure that the perception of those parties about the historical record, current performance and future prospects of the Company is in line with management's understanding of the actual situation.
The guiding principles of this policy, as it relates to shareholders, are that the Company gives equal treatment to shareholders in equal situations, that any price sensitive information is published in a timely fashion, and that information is provided in a format that is as full, simple, readable, understandable, transparent and consistent as possible.
The Company has an established web site and investor–relations portal where the Company's Annual Reports and other relevant information about the Company is published and made accessible to the public.
The Company produces a detailed Annual Report and Financial Statements, which provides insight about the business and its financial results, according to relevant international and local standards and regulations. In addition, the Company publishes full year and half year results.
Earlier this year, we had issued notices in daily newspapers asking shareholders to give us their proper addresses in order to ensure that the printed Annual Reports reach their correct destinations. We also sent forms to shareholders asking for this information and included stamped addressed envelopes to enable the shareholders to respond. The results from this exercise has been disappointing as less than 100 people have responded.
The Company produces annually a comprehensive Annual Report and Financial Statements in compliance with the Companies and Allied Matters Act, CAP C20, LFN 2004 and other relevant accounting standards and regulations.In addition, the Company has in place adequate internal control procedures that compel staff compliance with Company's standard operating procedure.
The Company has put in place a WHISTLE BLOWING POLICY which is known to all stakeholders. This policy has a dedicated “hot-line” and email system which could be used anonymously to report unethical practices.
The Company and its subsidiaries are committed to ensuring that internationally recognized best practices in corporate governance are observed in all areas of the Company's business.
The policies are constantly reviewed with focus on high ethical standards of honesty, integrity, accountability and transparency.
CORPORATE GOVERNANCE REPORTFor The Year Ended 31 December 2012 (Continued)
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23A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Report on the Financial Statements
Directors' Responsibility for the Financial Statements
Auditors' Responsibility
Opinion
Chartered Accountants
We have audited the accompanying consolidated and separate financial statements of A.G. Leventis (Nigeria) Plc and its subsidiaries which comprise the consolidated and separate statements of financial position as at 31 December 2012, 31 December 2011 and 1 January 2011, the consolidated income statement, statement of changes in equity, cash flow statement for the years ended 31 December 2012 and 31 December 2011, a summary of significant accounting policies and other explanatory information set out on pages 2 to 89.
The Directors are responsible for the preparation and fair presentation of these consolidated and separate financial statements in accordance with the Companies and Allied Matters Act CAP C20 LFN 2004, the Financial Reporting Council of Nigeria Act No 6, 2011, the International Financial Reporting Standards and for such internal control as the Directors determine are necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error.
Our responsibility is to express an opinion on these consolidated and separate financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors' judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal controls relevant to the entity's preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
In our opinion, the consolidated and separate financial statements present fairly, in all material respects, the financial position of A.G. Leventis (Nigeria) Plc and its subsidiaries as at 31 December 2012 and 31 December 2011 and 1 January 2011 and the financial performance and cash flows for the years ended 31 December 2012 and 31 December 2011 in accordance with the Companies and Allied Matters Act CAP C20 LFN 2004, the Financial Reporting Council of Nigeria Act No 6, 2011 and the International Financial Reporting Standards.
Lagos, Nigeria30 April 2013FRCN/2013/ICAN/00000001364
REPORT OF THE INDEPENDENT AUDITORS TO THE
MEMBERS OF A.G. LEVENTIS (NIGERIA) PLC
24A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
AUDIT COMMITTEE’S REPORTFor The Year Ended 31 December 2012
TO THE MEMBERS OF A.G. LEVENTIS (NIGERIA) PLC
In compliance with Section 359(6) of the Companies and Allied Matters Act Cap C20 Laws of the Federal Republic of Nigeria 2004, we;
. Reviewed the scope and planning of the audit requirements and found them adequate.
. Reviewed the financial statements for the year ended December 31, 2012 and are satisfied with the explanations obtained.
. Reviewed the External Auditors Management Letter for the year ended December 31, 2012 and are satisfied that Management is taking appropriate steps to address the issues raised.
. Ascertained that the accounting and reporting policies for the year ended December 31, 2012 are in accordance with legal requirements and agreed ethical practices.
The External Auditors confirmed having received full cooperation from the Company's Management and that the scope of their work was not restricted in any way.
Otunba Adedotun OdunugaChairman of the Audit Committee
stDated this 21 day of March 2013
Otunba Adedotun Odunuga - C hairman
Mr Rasaq O Mumuni - M ember
Miss Christie Vincent - M ember
Mr Arthur Bourekas - M ember
Mr Kenny E Odogwu - M ember
Mr Charalambos Katsaras - M ember
Members of the Audit Committee
THEFinancials
25A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
26A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
CONSOLIDATED STATEMENT OF PROFIT AND LOSS AND
OTHER COMPREHENSIVE INCOME
The accompanying notes on pages 30 to 100 and non IFRS statements on pages 101 to 104 form an integral part of these consolidated and separate financial statements.
Revenue 24 16,302,953 18,095,183 7,515,354 8,501,055Cost of sales 26.1 (12,858,419) (14,225,480) (5,189,628) (6,067,349)
3,444,534 3,869,703 2,325,726 2,433,706Investment income 27 182,262 135,895 334,546 193,961Other gains and losses 28 450,043 166,259 356,187 66,946Selling and distribution expenses 26.2 (1,301,791) (1,436,757) (261,315) (526,108)Administration expenses 26.3 (1,717,054) (1,629,180) (898,658) (865,139)
1,057,994 1,105,920 1,856,486 1,303,366Share of profit from joint venture 9.1 31,281 32,379 - -Finance costs 29 (436,429) (314,767) (258,445) (172,929)
Profit before tax 652,846 823,532 1,598,041 1,130,437Income tax expense 31 (368,677) (494,889) (479,048) (420,087)
284,169 328,643 1,118,993 710,350
Actuarial gain /(loss) 19.6 25,174 20,774 32,526 (8,865)Available for sale financial assets 5,526 (5,689) 5,526 (5,689)
Other comprehensive income for the year net of tax 30,700 15,085 38,052 (14,554)
Total comprehensive income for the year 343,728 695,796
Profit attributable to:Owners of the Company 16 734,252 562,228 1,118,993 710,350Non-controlling interests 17 (450,083) (233,585) - -
328,643 710,350
Owners of the Company 767,631 564,401 1,157,045 695,796Non-controlling interests 17 (452,762) (220,673) - -
343,728 695,796
All from continuing operations:Basic and Diluted 32 28 21 42 27
Notes 2011 2011
N'000 N’000Continuing operations
Gross profit
Total profit from the year
Other comprehensive income, net of tax
Total comprehensive income attributable to:
Earnings per share (kobo)
2012 2012 N'000 '000
314,869 1,157,045
284,169 1,118,993
314,869 1,157,045
N
The Group The Company
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27A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Chief Joseph Babatunde Oke, OON Mr. Arthur Bourekas Mr. Buchak Chairman Group Managing Director Group Finance DirectorFRC no: FRC/2013/NIM/00000002128 FRC no: FRC/2013/MANUN/00000002147 FRC no: FRC/2013/ICAN/00000002031
The accompanying notes on pages 30 to 100 and non-IFRS statements on pages 101 to 104 form an integral part of these consolidated andseparate financial statements.
Oleg
The Group The Company Notes 2011 01/01/11 2011 01/01/11
N'000 N'000 N'000 N'000
2012 2012 N'000 N'000
As at 31 December 2012
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
Property, plant and equipment 5 6,551,466 6,565,230 5,576,617 2,973,566 2,958,470 1,761,150Investment properties 6 4,743,124 5,122,708 5,056,204 4,508,218 4,887,802 4,821,298Goodwill 7 7,212 7,212 7,212 - - -Interest in subsidiaries 8.1 - - - 968,833 956,575 965,373Deferred tax assets 18 347,198 90,815 84,822 131,241 24,804 98,689Other financial assets 9 148,394 136,587 9,897 84,734 104,208 9,897
11,797,394 11,922,552 10,734,752 8,666,592 8,931,859 7,656,407
Inventories 10 5,251,866 4,561,857 4,689,600 1,862,582 1,721,981 1,692,079 3,888,510Trade and other receivables 11 3,497,331 2,923,880 3,529,494 3,070,601 3,093,988
Cash and bank balances 12 1,847,013 987,638 1,227,275 1,567,834 819,366 354,092
10,987,389 9,046,826 8,840,755 6,959,910 5,611,948 5,140,159
20,969,378 19,575,507 14,543,807 12,796,566
Share capital 13 1,323,645 1,323,645 1,323,645 1,323,645 1,323,645 1,323,645 Share premium 14 210,548 210,548 210,548 210,548 210,548 210,548 Other reserve 15 4,354,448 4,321,069 4,318,896 4,342,394 4,304,342 4,318,896Retained earnings 16 3,937,661 3,574,030 3,329,477 3,806,957 3,058,584 2,665,909 Attributable to equity holders of the parent 9,826,302 9,429,292 9,182,566 9,683,544 8,897,119 8,518,998Non-controlling interests 17 402,727 855,489 1,076,162 - - -
10,229,029 10,284,781 10,258,728 9,683,544 8,897,119 8,518,998
Deferred tax liabilities 18 898,935 753,221 578,608 840,281 704,276 569,274Retirement benefit obligation 19.4 671,584 763,883 739,640 415,346 488,306 451,837Finance lease liabilities 20 871,865 1,214,465 466,344 871,865 1,214,465 466,344
2,442,384 2,731,569 1,784,592 2,127,492 2,407,047 1,487,455
Borrowings 21 2,012,239 1,205,579 895,308 506,173 258,197 6,428Trade and other payables 22 6,467,841 5,287,804 5,058,774 2,074,212 2,090,807 2,002,053
Deferred revenue 23 660,217 689,254 828,196 387,117 306,488 318,125Short-term portion of finance lease liabilities 20 326,832 299,601 242,796 326,832 297,283 242,796Current tax liabilities 31 646,241 470,790 507,113 521,132 286,866 220,711
10,113,370 7,953,028 7,532,187 3,815,466 3,239,641 2,790,113
12,555,754 10,684,597 9,316,779 5,942,958 5,646,688 4,277,568
20,969,378 19,575,507 14,543,807 12,796,566
These financial statements were approved and authorised for issue by the Board of Directors on 27 March 2013 and were signed on its behalf by:
Assets Non-current assets
Total non-current assets Current assets
Total current assets Total assets
Equity and Liabilities Capital and reserves
Total equity Non-current liabilities
Total non-current liabilities
Current liabilities
Total current liabilities
Total liabilities
Total equity and liabilities
22,784,783 15,626,502
15,626,502 22,784,783
28A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
CHANGES IN EQUITYCONSOLIDATED STATEMENT OF
The Group Attributable to equity Non-
cShare Other holders of Share Retained ontrolling capital reserve the parent Total premium earnings interests
Notes N'000 '000 '000 ’000 '000 '000 '000N N NN N N
Balance at 1 January 2011 as restated 44b 1,323,645 210,548 4,318,896 3,329,477 9,182,566 1,076,162 10,258,728
Profit for the year - - - 562,228 562,228 (233,585) 328,643Other comprehensive income 15 - - 2,173 - 2,173 12,912 15,085
Total comprehensive income - - 2,173 562,228 564,401 (220,673) 343,728
Payment of dividends 16 - - - (317,675) (317,675) - (317,675)
Balance at 1 January 2012 210,548 3,574,030 855,489 1,323,645 4,321,069 9,429,292 10,284,781
Profit for the period - - - 734,252 734,252 (450,083) 284,169Other comprehensive income for the period 15 - - 33,379 - 33,379 (2,679) 30,700
Total comprehensive income - - 33,379 734,252 767,631 (452,762) 314,869Payment of dividends 16 - - - (370,621) (370,621) - (370,621)
Balance at 31 December 2012 210,548 3,937,661 402,727 1,323,645 4,354,448 9,826,302 10,229,029
AttributableThe Company Non- to equity
Share Retained controlling Share Other holders of premium earnings interests capital reserve the parent Total '000 '000 '000 '000 '000 '000 ’000N N N NN N N
`Balance at 1 January 2011 1,323,645 210,548 4,318,896 2,665,909 8,518,998 - 8,518,998
Profit for the year - - - 710,350 710,350 - 710,350Other comprehensive income 15 - - (14,554) - (14,554) - (14,554) - - - - - -Total comprehensive income - - - 710,350 710,350 - 710,350Reclassified from revaluation reserve - - (14,554) - (14,554) - (14,554)Payment of dividends 16 - - - (317,675) (317,675) - (317,675)
Balance at 1 January 2012 210,548 3,058,584 - 1,323,645 4,304,342 8,897,119 8,897,119
Profit for the period - - - 1,118,993 1,118,993 - 1,118,993Other comprehensiveincome for the period 15 - - 38,052 - 38,052 - 38,052
Total comprehensive income - - 38,052 1,118,993 1,157,045 - 1,157,045Payment of dividends 16 - - - (370,621) (370,621) - (370,621)
Balance at 31 December 2012 210,548 3,806,956 - 1,323,645 4,342,394 9,683,543 9,683,543
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29A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
The Group The Company Notes 2012 2012 2011 2011
N'000 N'000 N'000 N'000
Cash flows from operating activities
Cash receipts from customers 16,507,236 1 8,099,480 7,781,844 8,486,420Payments to suppliers and employees (15,480,586) ( 16,963,243) (7,061,961) (7,312,532)Valued added tax (net) (98,586) 4 ,772 (79,423) 13,347Tax paid 31 (286,938) ( 3 71,495) (197,899) (141,247)
Net cash generated by operating activities 33 641,126 769,514 442,561 1,045,988
Cash flows from investing activities
Proceeds from disposal of investment property 28.2 354,444 90,000 354,444 90,000Proceeds from disposal of property, plant andequipment 31,975 13,650 27,776 5,615Purchase of property, plant and equipment (668,498) (826,525) (348,226) (531,455)Proceeds from sale of investments 9.1 25,000 - 25,000 -Purchase of investments in companies 9.1 - (100,000) - (100,000)Interest received 27 182,262 135,008 334,546 193,768Dividend received - 887 - 193
Net cash generated by/(used in) investing activities (74,817) (686,980) 393,540 (341,879)
Cash flows from financing activities
Term loan obtained/(repaid) 21 (111,513) ( 245,010) - -Interest paid 29 (436,429) (314,767) (258,445) (172,929)Dividend paid 22.1 (77,165) ( 317,675) (77,165) (317,675)
Net cash used in financing activities (625,107) (8 77,452) (335,610) (490,604)
Net increase in cash and cash equivalents (58,798) (794,918) 500,491 213,505Cash and cash equivalents at beginning of the year (106,428) 688,490 561,169 347,664
Cash and cash equivalents at end of the year 12 ( 1 06,428) 561,169(165,226) 1,061,661
CONSOLIDATED STATEMENT OF CASH FLOWS
30A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012
1. Description of business
The Company was incorporated in 1958 as a limited liability company and converted to a public company on 29 November 1978.
The principal activities of the Group and Company include the sale and servicing of passenger cars, commercial vehicles, agricultural and construction equipment, property letting and management, provision of financial and other specialised services and investments in subsidiaries and affiliated companies engaged in the provision of food, hospitality services, sales and services of power generating equipment.
1.1 The analysis of ownership structure of 5% and above as at 31 December 2012
The ultimate holding company is Leventis Holding SA, a company registered in Luxembourg.
The Company has no ultimate controlling party, as the ownership of the holding company is spread across a number of trusts, with a variety of appointed trustees.
1.2 Going concern status
The Group has consistently been making profits. The Directors believe that there is no intention or threat from any source to curtail significantly its line of business in the foreseeable future. Thus, these financial statements are prepared on a going concern basis.
1.3 Operating environment
Emerging markets such as Nigeria are subject to different risks than more developed markets, including economic, political and social, and legal and legislative risks. As has happened in the past, actual or perceived financial problems or an increase
in the perceived risks associated with investing in emerging economies could adversely affect the investment climate in Nigeria and the country's economy in general.
The global financial system continues to exhibit signs of deep stress and many economies around the world are experiencing lesser or no growth than in prior years. These conditions could slow or disrupt Nigeria's economy, adversely affect the Company's access to capital and cost of capital for the Company and, more generally, its business, results of operations, financial condition and prospects.
Because Nigeria produces and exports large volumes of oil, the Nigerian economy is particularly sensitive to the price of oil on the world market which has fluctuated significantly during 2012 and 2011.
2. Significant Accounting Policies
2.1 Statement of compliance
The consolidated financial statements have been prepared in accordance with International Financial Reporting Standards. These are the Company's first full financial statements prepared under IFRS as issued by the International Accounting Standards Board (“IASB”), and interpretations issued by the International Financial Reporting Interpretations Committee of the IASB.
In the preparation of the accompanying financial statement, the provisions of IFRS 1 “First-Time Adoption of International Financial Reporting Standards” (“IFRS 1”) have been applied and the principle accounting policy decisions and exemption taken are detailed in Note 2.2. The financial statements comprise:
Consolidated statement of comprehensive income· Consolidated statement of financial position· Consolidated statement of changes in equity· Consolidated statement of cash flows· Notes to the consolidated financial statements.·
Leventis Holding SA 1 ,510,616,882 57.06
Boval SA 640,537,970 24.2
Leventis Overseas Ltd 177,198,452 6.69
Name of shareholder
No. of shares held
Percentage of share capital
FINANCIAL STATEMENTSNOTES TO THE
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31A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
These financial statements cover the financial year from 1 January 2012 to 31 December 2012, with comparative figures for the financial year from 1 January 2011 to 31 December 2011. In line with IFRS 1, comparative information in the statement of financial position is also presented for balances as at 1 January 2011, the date of transition to IFRS.
In preparing its opening IFRS balance sheet, the Company has adjusted amounts reported previously in financial statements prepared in accordance with Statements of Accounting Standards issued by the Nigerian Accounting Standards Board (“Nigerian GAAP”). An explanation of how the transition from Nigerian GAAP to IFRS has affected the Company's financial position, financial performance and cash flows is set out in Note 44 to the financials.
2.2 Basis of preparation
The consolidated and separate financial statements have for the first time, been prepared in accordance with IFRS that are effective at 31 December 2012 (the Company's first reporting date under IFRS) and requirements of the Companies and Allied Matters Act (CAMA) of Nigeria and the Financial Reporting Council (FRC) Act of Nigeria.
On initial adoption of IFRS, the Company applied the following exemptions from the requirements of IFRS and from their retrospective application as permitted by IFRS 1:
Business combinations
The Company has chosen not to restate business combinations that occurred prior to 1 January 2011 to comply with IFRS 3 “Business combinations”.
Property, plant and equipment
Net book value of property, plant and equipment under Nigerian GAAP are deemed to be carried at cost for subsequent accounting under IFRS.
Employee benefits
All cumulative actuarial gains and losses on defined pension schemes have been recognised in retained earnings at the transition date, 1 January 2011.
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
Borrowing costs
The Company has applied the transitional provisions in IAS 23 “Borrowing costs” and capitalises borrowing costs on assets where construction was commenced on or after the date of transition.
Investments in subsidiaries, jointly controlled entities and associated companies
AGL has elected to measure its investment in subsidiaries and associated companies at the carrying amount under previous GAAP.
Leases
AGL has opted to determine whether an arrangement, existing at the date of transition, contains a lease on the basis of fact and circumstances existing at the date of transition.
In accordance with IFRS, the Company has not revised its estimates required under IFRS that were also required under local GAAP as at 1 January 2011 and 31 December 2011 and, in addition, where estimates were not required under local GAAP; they have been based on information known at that time and not on subsequent events.
IFRS 1 also enforces some mandatory exceptions to retrospective application of IFRS: de-recognition of financial assets and financial liabilities, hedge accounting, accounting for changes in estimates, embedded derivatives and classification and measurement of financial assets. The Company has applied IFRS requirements on these items prospectively.
The consolidated and separate financial statements have been prepared on the historical cost basis. Historical cost is generally based on the fair value of the consideration given in exchange for assets.
All accounting policies applied at 31 December 2012 and described in these financial statements have been applied consistently to all periods presented.
32A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
2.3
The consolidated financial statements incorporate the financial statements of the Company and entities (including special purpose entities) controlled by the Company (its subsidiaries). Control is achieved where the Company has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.
Income and expenses of subsidiaries acquired or disposed of during the year are included in the consolidated statement of comprehensive income from the effective date of acquisition and up to the effective date of disposal, as appropriate. Total comprehensive income of subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if these results in the non-controlling interests having a deficit balance.
When necessary, adjustments are made to the financial statements of subsidiaries to bring their accounting policies into line with those used by other members of the Group.
All intra-group transactions, balances, income and expenses are el iminated in ful l on consolidation.
2.3.1
Changes in the Group's ownership interests in subsidiaries that do not result in the Group losing control over the subsidiaries are accounted for as equity transactions. The carrying amounts of the Group's interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the Company.
When the Group loses control of a subsidiary, a gain or loss is recognised in profit or loss and is calculated as the difference between (i) the aggregate of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying amount of the assets (including goodwill), and liabilities of the subsidiary and any non-controlling interests.
When assets of the subsidiary are carried at revalued
Basis of consolidation
Changes in the Group's ownership interests in existing subsidiaries
amounts or fair values and the related cumulative gain or loss has been recognised in other comprehensive income and accumulated in equity, the amounts previously recognised in other comprehensive income and accumulated in equity are accounted for as if the Group had directly disposed of the relevant assets (i.e. reclassified to profit or loss or transferred directly to retained earnings as specified by applicable IFRSs). The fair value of any investment retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequent accounting under IAS 39 “Financial Instruments: Recognition and Measurement” or, when applicable, the cost on initial recognition of an investment in an associate or a jointly controlled entity.
2.4
Acquisitions of businesses are accounted for using the acquisition method. The consideration transferred in a business combination is measured at fair value, which is calculated as the sum of the acquisition-date fair values of the assets transferred by the Group, liabilities incurred by the Group to the former owners of the acquiree and the equity interests issued by the Group in exchange for control of the acquiree. Acquisition-related costs are generally recognised in profit or loss as incurred.
At the acquisition date, the identifiable assets acquired and the liabilities assumed are recognised at their fair value, except that:i. Deferred tax assets or liabilities, and assets or
liabilities related to employee benefit arrangements are recognised and measured in accordance with IAS 12 “Income Taxes” and IAS 19 “Employee Benefits” respectively;
ii. Assets (or disposal groups) that are classified as held for sale in accordance with IFRS 5 “Non-Current Assets Held for Sale and Discontinued Operations” are measured in accordance with that Standard.
Goodwill is measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree, and the fair value of the acquirer's previously held equity interest in the acquiree (if any) over the net of the acquisition-date amounts of the identifiable assets acquired and the liabilities
Business combinations
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
33A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
assumed. If, after reassessment, the net of the acquisition-date amounts of the identifiable assets acquired and liabilities assumed exceeds the sum of the consideration transferred, the amount of any non-controlling interests in the acquiree and the fair value of the acquirer's previously held interest in the acquiree (if any), the excess is recognised immediately in profit or loss as a bargain purchase gain.
Non-controlling interests that are present ownership interests and entitle their holders to a proportionate share of the entity's net assets in the event of liquidation may be initially measured either at fair value or at the non-controlling interests' proportionate share of the recognised amounts of the acquiree's identifiable net assets. The choice of measurement basis is made on a transaction-by-transaction basis. Other types of non-controlling interests are measured at fair value or, when applicable, on the basis specified in another IFRS.
When the consideration transferred by the Group in a business combination includes assets or liabilities result ing from a contingent consideration arrangement, the contingent consideration is measured at its acquisition-date fair value and included as part of the consideration transferred in a business combination. Changes in the fair value of the contingent consideration that qualify as measurement period adjustments are adjusted retrospectively, with corresponding adjustments against goodwill. Measurement period adjustments are adjustments that arise from additional information obtained during the measurement period (which cannot exceed one year from the acquisition date) about facts and circumstances that existed at the acquisition date.
The subsequent accounting for changes in the fair value of the contingent consideration that do not qualify as measurement period adjustments depends on how the contingent consideration is classified. Contingent consideration that is classified as equity is not remeasured at subsequent reporting dates and its subsequent settlement is accounted for within equity. Contingent consideration that is classified as an asset or a liability is remeasured at subsequent reporting dates in accordance with IAS 39, or IAS 37 “Provisions, Contingent Liabilities and Contingent Assets”, as appropriate, with the corresponding gain or loss being recognised in profit or loss.
When a business combination is achieved in stages, the Group's previously held equity interest in the acquiree is remeasured to fair value at the acquisition date (i.e. the
date when the Group obtains control) and the resulting gain or loss, if any, is recognised in profit or loss. Amounts arising from interests in the acquiree prior to the acquisition date that have previously been recognised in other comprehensive income are reclassified to profit or loss where such treatment would be appropriate if that interests were disposed of.
If the initial accounting for a business combination is incomplete by the end of the reporting period in which the combination occurs, the Group reports provisional amounts for the items for which the accounting is incomplete. Those provisional amounts are adjusted during the measurement period (see above), or additional assets or liabilities are recognised, to reflect new information obtained about facts and circumstances that existed at the acquisition date that, if known, would have affected the amounts recognised at that date.
2.5
Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business (see Note 2.4 above) less accumulated impairment losses, if any.
For the purposes of impairment testing, goodwill is allocated to each of the Group's cash-generating units (or groups of cash-generating units) that is expected to benefit from the synergies of the combination.
A cash-generating unit to which goodwill has been allocated is tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable amount of the cash-generating unit is less than its carrying amount, the impairment loss is allocated first to reduce the carrying amount of any goodwill allocated to the unit and then to the other assets of the unit pro rata based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
Goodwill
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
34A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Group's policy for goodwill arising on the acquisition of an associate is described in Note 2.6 below.
2.6
The results, assets and liabilities of associates are incorporated in these consolidated financial statements using the equity method of accounting, except when the investment is classified as held for sale, in which case it is accounted for in accordance with IFRS 5. Under the equity method, an investment in an associate is initially recognised in the consolidated statement of financial position at cost and adjusted thereafter to recognise the Group's share of the profit or loss and other comprehensive income of the associate. When the Group's share of losses of an associate exceeds the Group's interest in that associate (which includes any long-term interests that, in substance, form part of the Group's net investment in the associate), the Group discontinues recognising its share of further losses. Additional losses are recognised only to the extent that the Group has incurred legal or constructive obligations or made payments on behalf of the associate.
Any excess of the cost of acquisition over the Group's share of the net fair value of the identifiable assets, liabilities and contingent liabilities of an associate recognised at the date of acquisition is recognised as goodwill, which is included within the carrying amount of the investment. Any excess of the Group's share of the net fair value of the identifiable assets, liabilities and contingent liabilities over the cost of acquisition, after reassessment, is recognised immediately in profit or loss.
The requirements of IAS 39 are applied to determine whether it is necessary to recognise any impairment loss with respect to the Group's investment in an associate. When applicable, the entire carrying amount of the investment (including goodwill) is tested for impairment in accordance with IAS 36 “Impairment of Assets” as a single asset by comparing its recoverable amount (higher of value in use and fair value less costs to sell) with its carrying amount. Any impairment loss recognised forms part of the carrying amount of the investment. Any reversal of that impairment loss is recognised in accordance with IAS 36 to the extent that the recoverable amount of the investment subsequently increases.
Investments in associates and subsidiaries
Upon disposal of an associate that results in the Group losing significant influence over that associate, any retained investment is measured at fair value at that date and the fair value is regarded as its fair value on initial recognition as a financial asset in accordance with IAS 39. The difference between the previous carrying amount of the associate attributable to the retained interest and its fair value is included in the determination of the gain or loss on disposal of the associate. In addition, the Group accounts for all amounts previously recognised in other comprehensive income in relation to that associate on the same basis as would be required if that associate had directly disposed of the related assets or liabilities. Therefore, if a gain or loss previously recognised in other comprehensive income by that associate would be reclassified to profit or loss on the disposal of the related assets or liabilities, the Group reclassifies the gain or loss from equity to profit or loss (as a reclassification adjustment) when it loses significant influence over that associate.
When a group entity transacts with its associate, profits and losses resulting from the transactions with the associate are recognised in the Group' consolidated financial statements only to the extent of interests in the associate that are not related to the Group.
2.7
A joint venture is a contractual arrangement whereby the Group and other parties undertake an economic activity that is subject to joint control (i.e. when the strategic financial and operating policy decisions relating to the activities of the joint venture require the unanimous consent of the parties sharing control).
When a group entity undertakes its activities under joint venture arrangements directly, the Group's share of jointly controlled assets and any liabilities incurred jointly with other venturers are recognised in the financial statements of the relevant entity and classified according to their nature. Liabilities and expenses incurred directly in respect of interests in jointly controlled assets are accounted for on an accrual basis. Income from the sale or use of the Group's share of the output of jointly controlled assets, and its share of joint venture expenses, are recognised when it is probable that the economic benefits associated with the transactions will flow to/from the Group and their
Interests in joint ventures
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
35A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
amount can be measured reliably. Joint venture arrangements that involve the establishment of a separate entity in which each venturer has an interest are re fer red to as jo int l y contro l led ent i t ies .
The Group reports its interest in jointly controlled entities using equity accounting, except when the investment is classified as held for sale, in which case it is accounted for in accordance with IFRS 5 “Non-Current Assets Held for Sale and Discontinued Operation”.
Any goodwill arising on the acquisition of the Group's
interest in a jointly controlled entity is accounted for in accordance with the Group's accounting policy for goodwill arising in a business combination.
When a group entity transacts with its jointly controlled
entity, profits and losses resulting from the transaction with the jointly controlled entity are recognised in the Group's consolidated financial statements only to the extent of interests in the jointly controlled entity that are not related to the Group.
2.8
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services provided in the normal course of business, net of discounts, value added taxes and other sales-related taxes.
2.8.1
Revenue from the sale of goods is recognised when all the following conditions are satisfied:· the Group has transferred to the buyer the significant
risks and rewards of ownership of the goods;· the Group retains neither continuing managerial
involvement to the degree usually associated with ownership nor effective control over the goods sold;
· the amount of revenue can be measured reliably;
· it is probable that the economic benefits associated with the transaction will flow to the entity; and
· the costs incurred or to be incurred in respect of the transaction can be measured reliably.
2.8.2
Revenue from a contract to provide services is recognised by reference to the stage of completion of the contract. The stage of completion of the contract is determined as follows:
Revenue recognition
Sale of goods
Rendering of services
· installation fees are recognised by reference to the stage of completion of the installation, determined as the proportion of the total time expected to install that has elapsed at the balance sheet date;
· servicing fees included in the price of products sold are recognised by reference to the proportion of the total cost of providing the service for the product sold, taking into account historical trends in the number of services actually provided on past goods sold; and
· revenue from time and material contracts is recognised at the contractual rates as labour hours are delivered and direct expenses incurred.
2.8.3
The Group's policy for recognition of revenue from leases is described in Note 2.9.1.
2.8.4
Dividend income from investments is recognised when the shareholders' rights to receive payment have been established (provided that it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably).
Interest income is recognised when it is probable that the economic benefits will flow to the Group and the amount of revenue can be measured reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset's net carrying amount on initial recognition.
2.9
Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases.
2.9.1
Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.
Rental income
Dividend and interest revenue
Leasing
The Group as lessor
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
36A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
2.9.2
Assets held under finance leases are recognised as assets of the Group at their fair value or, if lower, at the present value of the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included in the balance sheet as a finance lease obligation.
Lease payments are apportioned between finance expenses and reduction of the lease obligation so as to achieve a constant rate of interest on the remaining balance of the liability. Finance expenses are recognised immediately in profit or loss, unless they are directly attributable to qualifying assets, in which case they are capitalised in accordance with the Group's general policy on borrowing costs. Contingent rentals are recognised as expenses in the periods in which they are incurred.
Operating lease payments are recognised as an expense on a straight-line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
2.10
For the purpose of the consolidated financial statements, the results and financial position of the Group company is expressed in Naira, which is the functional currency of the Group, and the presentation currency for the consolidated financial statements.
In preparing the financial statements of each individual group entity, transactions in currencies other than the Group's functional currency (foreign currencies) are recognised at the rates of exchange prevailing at the dates of the transactions. At the end of each reporting period, monetary items denominated in foreign currencies are retranslated at the rates prevailing at that date. Non-monetary items carried at fair value
The Group as lessee
Foreign currency translation
that are denominated in foreign currencies are retranslated at the rates prevailing at the date when the fair value was determined. Non-monetary items that are measured in terms of historical cost in a foreign currency are not retranslated.
Exchange differences on monetary items are recognised in profit or loss in the period in which they arise.
2.11
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that the Group will be required to settle the obligation, and a reliable estimate can be made of the amount of obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risk and the uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (where the effect of time value of money is material).
When some or all the economic benefits required to settle a provision are expected to be recovered from a third party, a receivable is recognised as an asset if it is virtually certain that the reimbursement will be received and the amount of the receivable can be measured reliably.
2.12
The Group operates a defined contribution based retirement benefit scheme for its staff, in accordance with the Pension Reform Act of 2004 with employee and employer contributing 7.5% and 10% of the employees' relevant emoluments respectively.
Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contribution.
The Group also operates a gratuity scheme (defined benefit plan), for its qualified staff, for which the benefits are related to employees' length of service and remuneration.
Provisions
Pensions and other post-employment benefits
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In relation to the unfunded gratuity scheme plan the liability recognised at the statement of financial position date is the present value of the defined benefit obligation. The defined benefit obligation is calculated annually by independent actuary using the Projected Unit Credit Method.
Actuarial gains and losses that arise are recognised in shareholders' equity in the statement of other comprehensive income in the period they arise. Past service costs are recognised immediately to the extent that benefits are vested and otherwise are amortised on a straight-line basis over the average period until the benefits become vested. Current service costs and any past service costs, together with the unwinding of the discount on plan liabilities, offset by the expected return on plan assets where applicable, are charged to operating expenses.
The retirement benefit obligation recognised in the consolidated statement of financial position represents the present value of the defined benefit obligation as adjusted for unrecognised actuarial gains and losses and unrecognised past service cost.
2.13
Income tax expense represents the sum of the tax currently payable and deferred tax.
2.13.1
The tax currently payable is based on taxable profit for the year. Taxable profit differs from profit before tax as reported in the consolidated statement of profit or loss and other comprehensive income because of items of income or expense that are taxable or deductible in other years and items that are never taxable or deductible. The Group's liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the end of the period.
2.13.2
Deferred tax is recognised on temporary differences between the carrying amounts of assets and liabilities in the consolidated financial statements and the corresponding tax basis used in the computation of taxable profit. Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are generally recognised for all deductible temporary differences to the extent that it is probable that taxable profits will be available against which those deductible temporary differences can be used. Such
Taxation
Current tax
Deferred tax
deferred tax assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the taxable profit nor the accounting profit.
Deferred tax liabilities are recognised for taxable temporary differences associated with investments in subsidiaries and associates, and interests in joint ventures, except where the Group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future. Deferred tax assets arising from deductible temporary differences associated with such investments and interests are only recognised to the extent that it is probable that there will be sufficient taxable profits against which to use the benefits of the temporary differences and they are expected to reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.
Deferred tax liabilities and assets are measured at the tax rates that are expected to apply in the period in which the liability is settled or the asset realised, based on tax rates (and tax laws) that have been enacted or substantively enacted by the end of the reporting period.
The measurement of deferred tax liabilities and assets reflects the tax consequences that would follow from the manner in which the Group expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities.
2.13.3
Current and deferred tax are recognised in profit or loss, except when they relate to items that are recognised in other comprehensive income or directly in equity, in which case, the current and deferred tax are also recognised in other comprehensive income or directly in equity respectively. Where current tax or deferred tax arises from the initial accounting for a business combination, the tax effect is included in the accounting for the business combination.
Current and deferred tax for the year
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
38A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
2.14
Land and buildings held for use in the production or supply of goods or services, or for administrative purposes are stated at cost less accumulated depreciation and any recognised impairment loss.
Depreciation on buildings is charged to profit and loss account.
Assets in the course of construction for production, supply or administrative purposes, or for purposes not yet determined, are carried at cost, less any recognised impairment loss. Cost includes professional fees and, for qualifying assets, borrowing costs capitalised in accordance with the Group's accounting policy. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.
Freehold land is not depreciated.
Fixtures and equipment are stated at cost less accumulated depreciation and any recognised impairment loss.
Depreciation is recognised so as to write off the cost or valuation of assets (other than land and properties under construction) less their residual values over their useful lives, using the straight-line method except where another method gives a true reflection of the pattern of consumption. The basis for depreciation is as follows:
Property, plant and equipment
Assets held under operating leases are depreciated over the useful life of the asset.
Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, over the term of the relevant lease.
In relation to factory plant and machinery, the only company with production within the Group (Leventis
Foods Limited), changed the applied depreciation method. Effective 1 January 2012, in relation to factory plant and machinery, the Company changed its method of computing depreciation from straight-line method to unit of production method. In line with IAS 8 the change has been accounted for prospectively.
The change is considered preferable because the unit of production method will more accurately reflect the pattern of usage and the expected benefits of such assets. The net book value of assets acquired prior to 1 January 2012 with useful lives remaining will be depreciated using the unit of production method prospectively. As a result of the change to the unit of production method of depreciating the Group's depreciation expense decreased by N150 million for the year ended 31 December 2012.
The gain or loss arising on the disposal or scrapping of an asset is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in income.
2.15
Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation using the straight-line method applying 2% per annum adjusted for any impairment.
The Group elected to use the previous GAAP revaluation of investment properties at or before the date of transition to IFRS as deemed cost at that date
The revaluation uplift recognised under previous GAAP has been reclassified within other reserves.
Investment property
Leasehold buildings 20 - 50Investment property 20 - 50Plant and machinery – factory production on unit of
productionPlant and machinery – other 4 - 10Office equipment and furniture 5 - 20Computer equipment 2 - 3Motor vehicles 2 - 4
Years
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
39A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Any impairment loss arising after the transition to IFRS is recognised in the consolidated profit or loss and is not offset against the amount accumulated in equity under previous GAAP.
An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on the derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the property is recognised.
2.16
At each balance sheet date, the Group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the Group estimates the recoverable amount of the cash-generating unit to which the asset belongs.
An intangible asset with an indefinite useful life is tested for impairment at least annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset is estimated to be less than its carrying amount, the carrying amount of the asset is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.
Impairment of tangible and intangible assets excluding goodwill
When an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (or cash-generating unit) in prior years. A reversal of an impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation increase.
2.17
Inventories are stated in the financial statements at the lower of cost and net realisable value. Cost comprises direct materials and, where applicable, direct labour costs and those overheads that have been incurred in bringing the inventories to their present location and condition. Cost is calculated using the weighted average method. Net realisable value represents the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling and distribution.
2.18
Financial assets and financial liabilities are recognised when a group entity becomes a party to the contractual provisions of the instruments.
Financial assets and financial liabilities are initially measured at fair value. Transaction costs that are directly attributable to the acquisition or issue of financial assets and financial liabilities (other than financial assets and financial liabilities at fair value through profit or loss (“FVTPL”)) are added to or deducted from the fair value of the financial assets or financial liabilities, as appropriate, on initial recognition. Transaction costs directly attributable to the acquisition of financial assets or financial liabilities at fair value through profit or loss are recognised immediately in profit or loss.
Inventories
Financial instruments
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
40A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Group determines the classification of its financial instruments at initial recognition.
2.19
Financial assets are classified into the following specified categories: 'available-for-sale' (AFS) financial assets and 'loans and receivables'. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. All regular way purchases or sales of financial assets are recognised and derecognised on a trade date basis. Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the time frame established by regulation or convention in the marketplace.
2.20
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest basis for debt instruments other than those financial assets classified as at FVTPL.
Financial assets
Effective interest method
2.20.1
AFS financial assets are non-derivatives that are either designated as AFS or are not classified as (a) loans and receivables, (b) held-to-maturity investments or (c) financial assets at fair value through profit or loss.
Listed equity shares held by the Group that are traded in an active market are classified as AFS and are stated at fair value at the end of each reporting period. Changes in the carrying amount of AFS monetary financial assets relating to changes in foreign currency rates, interest income calculated using the effective interest method and dividends on AFS equity investments are recognised in profit or loss. Other changes in the carrying amount of available-for-sale financial assets are recognised in other comprehensive income and accumulated under the heading of other reserve. When the investment is disposed of or is determined to be impaired, the cumulative gain or loss previously accumulated in the investments revaluation reserve is reclassified to profit or loss.
Dividends on AFS equity instruments are recognised in profit or loss when the Group's right to receive the dividends is established.
The fair value of AFS monetary financial assets denominated in a foreign currency is determined in that foreign currency and translated at the spot rate prevailing at the end of the reporting period. The foreign exchange gains and losses that are recognised in profit or loss are determined based on the amortised cost of the monetary asset. Other foreign exchange gains and losses are recognised in other comprehensive income.
AFS equity investments that do not have a quoted market price in an active market and whose fair value cannot be reliably measured are measured at cost less a n y i d e n t i f i e d impairment losses at the end of each reporting period.
Available-for-sale financial assets (AFS financial assets)
Description of asset/liability Classification
Investments Available-for-sale
Loans and advances receivable Loans and receivables
Loans to subsidiaries Loans and receivables
Trade and other receivables Loans and receivables
Cash and cash equivalents Loans and receivables
Loans payable and borrowings Financial liabilities at amortised cost
Trade and other payables Financial liabilities at amortised cost
Loans from subsidiaries Financial liabilities at amortised cost
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FINANCIAL STATEMENTSNOTES TO THE
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2.20.2
Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. Loans and receivables (including trade and other receivables, bank balances and cash) are measured at amortised cost using the effective interest method, less any impairment loss.
Interest income is recognised by applying the effective interest rate, except for short-term receivables when the effect of discounting is immaterial.
2.20.3
Financial assets, other than those at FVTPL, are assessed for indicators of impairment at the end of each reporting period. Financial assets are considered to be impaired when there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows of the investment have been affected.
For AFS equity investments, a significant or prolonged decline in the fair value of the security below its cost is considered to be objective evidence of impairment.
For all other financial assets, objective evidence of impairment could include:
· significant financial difficulty of the issuer or counterparty; or
· breach of contract, such as a default or delinquency in interest or principal payments; or
· it becoming probable that the borrower will enter bankruptcy or financial re-organisation; orthe disappearance of an active market for that
· financial asset because of financial difficulties.
For certain categories of financial assets, such as trade receivables, assets are assessed for impairment on a collective basis even if they were assessed not to be impaired individually. Objective evidence of impairment for a portfolio of receivables could include the Group's past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period of 30 days, as well as observable changes in
Loans and receivables
Impairment of financial assets
national or local economic conditions that correlate with default on receivables.
For financial assets carried at amortised cost, the amount of the impairment loss recognised is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the financial asset's original effective interest rate.
For financial assets that are carried at cost, the amount of the impairment loss is measured as the difference between the asset's carrying amount and the present value of the estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment loss will not be reversed in subsequent periods.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance account. When a trade receivable is considered uncollectible, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. Changes in the carrying amount of the allowance account are recognised in profit or loss.
When an AFS financial asset is considered to be impaired, cumulative gains or losses previously recognised in other comprehensive income are reclassified to profit or loss in the period.
For financial assets measured at amortised cost, if, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been recognised.
In respect of AFS equity securities, impairment losses previously recognised in profit or loss are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss is recognised in other comprehensive income and
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
42A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
accumulated under the heading of investments revaluation reserve. In respect of AFS debt securities, impairment losses are subsequently reversed through profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss.
2.20.4
The Group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire, or when it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another party. If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset, the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset, the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.
On derecognition of a financial asset in its entirety, the difference between the asset's carrying amount and the sum of the consideration received and receivable and the cumulative gain or loss that had been recognised in other comprehensive income and accumulated in equity is recognised in profit or loss.
On derecognition of a financial asset other than in its entirety (e.g. when the Group retains an option to repurchase part of a transferred asset), the Group allocates the previous carrying amount of the financial asset between the part it continues to recognise under continuing involvement, and the part it no longer recognises on the basis of the relative fair values of those parts on the date of the transfer. The difference between the carrying amount allocated to the part that is no longer recognised and the sum of the consideration received for the part no longer recognised and any cumulative gain or loss allocated to it that had been recognised in other comprehensive income is recognised in profit or loss. A cumulative gain or loss that had been recognised in other comprehensive income is allocated between the part that continues to be recognised and the part that is no longer recognised on the basis of the relative fair values of those parts.
Derecognition of financial assets
2.21
2.21.1
Debt and equity instruments issued by a Group entity are classified as either financial liabilities or as equity in accordance with the substance of the contractual arrangements and the definitions of a financial liability and an equity instrument.
2.21.2
Financial liabilities are classified as other financial liabilities.
2.21.3
Other financial liabilities (including borrowings and trade and other payables) are subsequently measured at amortised cost using the effective interest method.
The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments (including all fees and points paid or received that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the financial liability, or (where appropriate) a shorter period, to the net carrying amount on initial recognition.
In particular trade payables are held at amortised cost which equates to nominal value. Long-term payables are discounted where the effect is material.
2.21.4
The Group derecognises financial liabilities when, and only when, the Group's obligations are discharged, cancelled or they expire. The difference between the carrying amount of the financial liability derecognised and the consideration paid and payable is recognised in profit or loss.
2.22
Derivatives embedded in non-derivative host contracts are treated as separate derivatives when they meet the definition of a derivative, their risks
Financial liabilities and equity instruments
Classification as debt or equity
Financial liabilities
Other financial liabilities
Derecognition of financial liabilities
Embedded derivatives
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FINANCIAL STATEMENTSNOTES TO THE
43A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
and characteristics are not closely related to those of the host contracts and the contracts are not measured at fair value through profit and loss.
Such derivatives are measured at fair value at the date the contracts are entered into and subsequently remeasured to their fair value at the end of each reporting period. The resultant gain or loss is recognised in profit and loss immediately.
2.23
A segment is a distinguished component of the Group that is engaged either in providing related products or services (business segment), or in providing products or services within a particular economic environment (geographical segment), which is subject to risks and returns that are different from those of other segments. Segment information is presented in respect of the Group's business and geographical segments, where applicable.
The Group's primary format for segment reporting is based on business segments that comprise the structure used by the chief operating decision-maker (Chief Executive Officer and Managing Director) to make key operating decisions and assess performance.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
The Group evaluates the performance of its business segments based on operating profit. The Group accounts for intersegment sales and transfers as if the sales and transfers were entered into under the same terms and conditions as would have been entered into in a market related transaction.
The financial information of the Group's business segments is reported to the Chief Executive Officer and Managing Director for purposes of making decisions about allocating resources to the segment and assessing its performance.
The Group operation comprises three major service lines; food and hospitality, sales, transportation and servicing of engines and other services.
Segmental reporting
3.
3.1
· IFRS 9 Financial Instruments ;2· IFRS 10 Consolidated Financial Statements ;
2· IFRS 11 Joint Arrangements ;2· IFRS 12 Disclosure of Interest in Other Entities ;
1· IFRS 13 Fair Value Measurement ;· Amendments to IFRS 7 Financial Instruments:
Disclosures –“Disclosures – Offsetting Financial Assets and Financial Liabilities”;
· Amendments to IFRS 9 Financial Instruments and IFRS 7 Financial Instruments: Disclosures –“Mandatory
3Effective Date of IFRS 9 and Transition Disclosures” ;· Amendments to IFRS 10 Consolidated Financial
Statements, IFRS 11 Joint Arrangements and IFRS 12 Disclosure of Interest in Other Entities – “Consolidated Financial statements, Joint Arrangements and Disclosure of Interest in Other Entities: Transition
1Guidance” ;1· IAS 19 (as revised in 2011) Employee Benefits ;
· IAS 27 (as revised in 2011) Separate Financial 2Statements ;
· IAS 28 (as revised in 2011) Investments in Associates 2and Joint Ventures ;
· Amendments to IAS 32 Financial Instruments: Presentation – “Offsetting Financial Assets and
4Financial Liabilities” ;· Amendments to IFRSs – Annual Improvements to
IFRSs 2009-2011 cycle except for the amendment to 1IAS 1 (see above) ;
· IFRIC 20 Stripping Costs in the Production Phase of a 1Surface Mine .
1 Effective for annual periods beginning on or after 1 January 2013, with earlier application permitted.
2 Each of the five standards becomes effective for annual periods beginning on or after 1 January 2013, with earlier application permitted if all the other standards in the 'package of five' are also early applied (except for IFRS 12 that can be applied earlier on its own).
3 Effective for annual periods beginning on or after 1 January 2015, with earlier application permitted.
4 Effective for annual periods beginning on or after 1 January 2014, with earlier application permitted.
Application of new and revised international financial reporting standards (IFRSs) New and revised IFRSs in issue but not yet effective
3
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
44A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
IFRS 9 Financial Instruments
Key requirements of IFRS 9:
IFRS 9 Financial Instruments, issued in November 2009 and amended in October 2010, introduces new requirements for the classification and measurement of financial assets and financial liabilities and for derecognition.
· all recognised financial assets that are within the scope of IAS 39 Financial Instruments: Recognition and Measurement to be subsequently measured at amortised cost or fair value. Specifically, debt investments that are held within a business model whose objective is to collect the contractual cash flows, and that have contractual cash flows that are solely payments of principal and interest on the principal outstanding are generally measured at amortised cost at the end of subsequent accounting periods. All other debt investments and equity investments are measured at their fair values at the end of subsequent accounting periods. In addition, under IFRS 9 Financial Instruments, entities may make an irrevocable election to present subsequent changes in the fair value of an equity investment (that is not held for trading) in other comprehensive income, with only dividend income generally recognised in profit or loss.
· with regard to the measurement of financial liabilities designated as at fair value through profit or loss, IFRS 9 Financial Instruments requires that the amount of change in the fair value of the financial liability, that is attributable to changes in the credit risk of that liability, is presented in other comprehensive income, unless the recognition of the effects of changes in the liability's credit risk in other comprehensive income would create or enlarge an accounting mismatch in profit or loss. Changes in fair value attributable to a financial liability's credit risk are not subsequently reclassified to profit or loss. Previously, under IAS 39 F inanc ia l Ins t ruments : Recogni t ion and Measurement, the entire amount of the change in the fair value of the financial liability designated as at fair value through profit or loss was recognised in profit or loss.
The Group anticipates that IFRS 9 Financial Instruments in the future may have a significant impact on amounts reported in respect of the Group's and Company's financial assets and financial liabilities. However, it is not practicable to provide a reasonable estimate of the effect of IFRS 9 Financial Instruments until a detailed review has been completed.
In May 2011, a package of five Standards on consolidation, joint arrangements, associates and disclosures was issued, including IFRS 10 Consolidated Financial Statements, IFRS 11 Joint Arrangements, IFRS 12 Disclosure of Interest in Other Entities, IAS 27 (as revised in 2011) Separate Financial Statements and IAS 28 (as revised in 2011) Investments in Associates and Joint Ventures.
Key requirements of these five Standards are described below.
replaces the parts of IAS 27 Consolidated and Separate Financial Statements that deal with consolidated financial statements. SIC-12 Consolidation – Special Purpose Entities will be withdrawn upon the effective date of IFRS 10 Consolidated Financial Statements. Under IFRS 10 Consolidated Financial Statements, there is only one basis for consolidation, that is, control. Extensive guidance has been added in IFRS 10 Consolidated Financial Statements to deal with complex scenarios. As a result the Group may need to change its basis for consolidation of its investees where applicable in the future. However, it is not practicable to provide a reasonable estimate of that effect until a detailed review has been completed.
replaces IAS 31 Interests in Joint Ventures. IFRS 11 Joint Arrangements deals with how a joint arrangement of which two or more parties have joint control should be classified. Under IFRS 11 Joint Arrangements, joint arrangements are classified as joint operations or joint ventures, depending on the rights and obligations of the parties to the arrangements. The Group currently does not hold any Joint Arrangement contract but will assess its impact when it does in future.
is a disclosure standard and is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or unconsolidated structured entities. The Group anticipates that IFRS 12 Disclosure of Interest in Other Entities in the future may have a significant impact on the Group disclosures with respect to entities that the Group has interests in.
New and revised Standards on consolidation, joint arrangements, associates and disclosures
IFRS 10 Consolidated Financial Statements
IFRS 11 Joint Arrangements
IFRS 12 Disclosure of Interests in Other Entities
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RS
TH
E F
INA
NC
IALS
OU
R B
US
INE
SS
UN
ITS
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
45A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
will be adopted in the Group's financial statements for the annual period beginning on 1 January 2013. The Group does not anticipate that the amendments to IAS 27 and IAS 28 will have a significant impact on its disclosures and on amounts reported in respect of the Group's financial assets and financial liabilities. However, it is not practicable to provide a reasonable estimate of that effect until a detailed review has been completed.
IFRS 13 Fair Value Measurement establishes a single source of guidance for fair value measurements and disclosures about fair value measurements. The Standard defines fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements.
The Group anticipates that the application of the new Standard may affect certain amounts reported in the financial statements and result in more extensive disclosures in the consolidated and separate financial statements.
The amendments to IAS 32 Financial Instruments: Presentation clarify existing application issues relating to the offset of financial assets and financial liabilities requirements. Specifically, the amendments clarify the meaning of 'currently has a legally enforceable right of set-off' and 'simultaneous realisation and settlement'.
The amendments to IFRS 7 Financial Instruments: Disclosures require entities to disclose information about rights of offset and related arrangements (such as collateral posting requirements) for financial instruments under an enforceable master netting agreement or similar arrangement.
The disclosures should be provided retrospectively for all comparative periods.
The Group management anticipates that the application of these amendments to IAS 32 and IFRS 7 may result in more disclosures being made with regards to offsetting financial assets and financial liabilities in the future.
The Group anticipates that IAS 27(2011) and IAS 28(2011)
IFRS 13 Fair Value Measurement
Amendments to IFRS 7 Financial Instruments: Disclosures and IAS 32 Financial Instruments: Presentation – “Offsetting Financial Assets and Financial Liabilities and the related disclosures”
IAS 19 Employee Benefits
Annual Improvements to IFRSs 2009-2011 Cycle issued in May 2012
Amendments to IAS 32 Financial Instruments: Presentation
Amendments to IAS 16 Property Plant and Equipment
The amendments to IAS 19 Employee Benefits change the accounting for defined benefit plans and termination benefits and a definition of short-term benefits. The most significant change relates to the accounting for changes in defined benefit obligations and plan assets. The amendments require the recognition of changes in defined benefit obligations and in fair value of plan assets when they occur and hence eliminate the 'corridor approach' permitted under the previous version of IAS 19 Employee Benefits and accelerate the recognition of past service costs.
The amendments require all actuarial gains and losses to be recognised immediately through other comprehensive income in order for the net pension asset or liability recognised in the consolidated statement of financial position to reflect the full value of the plan deficit or surplus. Furthermore, the interest cost and expected return on plan assets used in the previous version of IAS 19 Employee Benefits are replaced with a 'net-interest' amount, which is calculated by applying the discount rate to the net defined benefit liability or asset.
The amendments to IAS 19 Employee Benefits require retrospective application. The Group management does not anticipate that the revision of IAS 19 Employee Benefits will have a significant effect on the Company's consolidated and separate financial statements.
The Annual Improvements to IFRSs 2009-2011 Cycle include the following amendments to various IFRSs:
The amendments to IAS 32 Financial Instruments: Presentation clarify that income tax relating to distributions to holders of an equity instrument and to transaction costs of an equity transaction should be accounted for in accordance with IAS 12 Income Taxes.
This improvement clarifies that major spare parts and servicing equipment that meet the definition of property, plant and equipment are not inventory.
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
46A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Amendments to IAS 34 Interim Financial Reporting
Critical accounting judgements and key sources of estimation uncertainty
Critical judgements in applying the Group's accounting policies
Key sources of estimation uncertainty
The amendment aligns the disclosure requirements for total segment assets with total segment liabilities in interim financial statements. This clarification also ensures that interim disclosures are aligned with annual disclosures.
The Group management anticipates that the amendments to IAS 32 Financial Instruments: Presentation will have no effect on the Company's consolidated and separate financial statements. An entity should apply this Interpretation to production stripping costs incurred on or after the beginning of the earliest period presented, with specific transitional provisions.
4.
In the application of the Group's accounting policies, which are described in Note 2, the Directors are required to make judgements, estimates and assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
4.1
The critical judgements, apart from those involving estimations (which are dealt with separately below), that the Directors have made in the process of applying the Group's accounting policies are disclosed in the relevant notes to the financial statements.
4.2
The key assumptions concerning the future, and other key sources of estimation uncertainty at the
balance sheet date, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year, are discussed below.
4.3
Determining whether goodwill is impaired requires an estimation of the value in use of the cash-generating units to which goodwill has been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The goodwill was tested for impairment and there was no indication of impairment observed after testing. Therefore, no impairment loss was recognised during 2012.
4.4
Based on management judgement, the useful lives of tangible assets, except for the plant and machinery in Leventis Food Limited where the useful life was re-assessed based on the production unit method, remain constant during the reporting period. Details of the change to the method of depreciation in Leventis Foods are included in Note 2. The determination of useful lives includes significant judgement and the resultant depreciation may significantly affect profit for the year.
4.5
The Company makes allowance for doubtful debts based on an assessment of the recoverability of receivables. Allowances are applied to receivables where events or changes in circumstances indicate that the carrying amounts may not be recoverable. Management specifically analysed historical bad debts, customer concentrations, customer creditworthiness, current economic trends and changes in customer payment terms when making a judgement to evaluate the adequacy of the allowance of doubtful debts of receivables. Where the expectation is different from the original estimate, such difference will impact the carrying value of receivables.
Impairment of goodwill
Review of the useful life of tangible assets
Impairment of trade and other receivables
CO
RP
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ATE
PR
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DIR
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
47A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
4.6
The unfunded defined gratuity liability recognised at the statement of financial position date is the present value of the defined benefit obligation. The defined benefit obligation is calculated annually by independent actuary using the Projected Unit Credit Method. The use of this method involves a number of actuarial assumptions. These assumptions are the entity's best estimates of the variables that will determine the final cost of the post employment benefit provided. These variables include assumptions about mortality rates, change in retirement age, and financial assumptions, such as discount rates and benefit levels.
4.7
Reviews are made periodically by management on damaged, obsolete and slow moving inventories. These reviews require judgement and estimates. Possible changes in these estimates could result in revisions to the valuation of inventories.
4.8
Determining whether assets are impaired requires an estimation of the value in use of the cash-generating units to which assets have been allocated. The value in use calculation requires the entity to estimate the future cash flows expected to arise from the cash-generating unit and a suitable discount rate in order to calculate present value. The assets were tested for impairment which resulted in no impairment loss being identified. No impairment loss was therefore recognised during 2012.
Defined benefit plan
Allowance for inventories written down
Impairment of assets
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
48A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
5.
P
rop
ert
y, p
lan
t an
d e
qu
ipm
en
t
5.1
Red
uct
ion in
cost
s re
late
to a
mounts
rec
eive
d fr
om
an in
sura
nce
cla
im v
alued
at
11
8 m
illio
n d
uring
the
year
in res
pec
t of d
efic
ient w
ork
done
by
a co
ntr
acto
r
and
corr
ecti
on o
f err
ors
in rec
og
nit
ion o
f cost
s am
ounti
ng
to N
8.3
93
mill
ion p
revi
ousl
y re
cord
ed u
nd
er p
rop
erty
und
er c
onst
ruct
ion.
N
CO
RP
OR
ATE
PR
OFIL
EO
UR
DIR
EC
TO
RS
TH
E F
INA
NC
IALS
OU
R B
US
INE
SS
UN
ITS
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
49A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
5.1
Red
uct
ion in c
ost
s re
late
to a
mounts
rec
eive
d f
rom
an insu
rance
cla
im v
alued
at
11
8 m
illio
n d
uring
the
year
in r
esp
ect
of
def
icie
nt
work
done
by
a co
ntr
acto
r an
d c
orr
ecti
on o
f err
ors
in rec
og
nit
ion o
f cost
s am
ounti
ng
to N
8.3
93
mill
ion p
revi
ousl
y re
cord
ed u
nd
er p
rop
erty
und
er c
onst
ruct
ion.
N
5.
Pro
pert
y, p
lan
t an
d e
qu
ipm
en
t (c
on
tin
ued
)
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
50A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
5.1
Management reviewed all assets for evidence of impairment, and except for the plant and machinery in Leventis Foods Limited, no indications of impairment were observed.
During the year, as a result of the unexpected poor performance and restructuring of Leventis Foods Limited, the Group carried out a detailed review of the recoverable amount of that Company's manufactur ing plant and related equipment. As a result of the review, management concluded that the related plant and machinery was not carried at a value higher than its recoverable amount and therefore no impairment loss was recognised.
The recoverable amount of plant and machinery was determined on the basis of their value in use. The discount rate used in measuring value in use was 15% (2011: 15%).
5.2
Leashold land and bui ldings are depreciated over the period of the lease.
5.3
Building are accounted for at cost (or deemed cost) and depreciated over the period of the lease.
An independent valuation of the Group's land and buildings was performed by Messrs Jide Taiwo & Co, Estate Surveyors and Valuers to determine the fair value of the land and buildings as at 31 December 2008. The valuation, which conforms to International Valuation Standards, was determined by reference to recent market
Impairment losses recognised in the year
Leashold land
Buildings
transactions on arm's length term at 3.6 billion.
The Company's total land and buildings were revalued in December 2011 by Messrs Jide Taiwo & Co, Estate Surveyors and Valuers at N4.4 billion on the basis of open market valuation.
In both cases, the revalued amount was not accounted for.
5.4
The Group's obligations under finance lease are secured by the lessors' title to the leased assets, which have a carrying amount of N2.06 billion (31 December 2011: N1.98 billion) (Note 5.5).
N
Assets pledged as security
CO
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ITS
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
51A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
5.5
Analysis of Assets held under finance lease
At 1 January 2012 2,315,789 965,670 2,250 2,311,689 965,670 -Additions 448,897 1,350,119 982,483 448,893 1,346,019 982,484Transfers - - (2,250) - - -Disposals (34,228) - (16,814) (34,228) - (16,814)
At 31 December 2012 2,730,458 2,315,789 965,669 2,726,354 2,311,689 965,670
At 1 January 2012 338,971 81,669 750 338,629 81,669 -Charge for the year 339,435 257,302 83,350 338,409 256,960 83,350Transfers - - (750) - - -Disposals (7,549) - (1,681) (7,549) - (1,681)
At 31 December 2012 670,857 338,971 81,668 669,489 338,629 81,669
At 31 December 2012 1,976,818 884,001 1,973,060 884,001
At 31 December 2011 884,001 1,500 884,001 -
Assets held under finance lease represent Trucks on Sales and Lease back from various banks. Interest rate underlying all obligations under finance leases are fixed at respective contract dates ranging from 14% to 18% (2011: 14% to 18%) per annum. The average lease term is 7 years and the Group has options to purchase the motor vehicles for a nominal amount at the end of the lease terms.
Assets under finance lease with a carrying amount of N2.1 billion (2011: N1.98 billion) are pledged to secure the finance lease obligation (Note 20).
Assets under finance lease
The Group The Company Motor Motor Motor Motor vehicles vehicles vehicles vehicles
Cost: 2011 01/01/11 2011 01/01/11 N'000 N'000 N'000 N'000
Accumulated depreciation and impairment
Net book value:
Motor Motor vehicles vehicles 2012 2012
N'000 N'000
2,059,601 2,056,865
1,976,818 1,973,060
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
52A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
6.
Balance at beginning of year 5,163,561 5,056,204 4,928,655 4,821,298Additions during the year - 22,995 - 22,995Reclassification from Lease hold land and building 14,281 184,362 14,281 184,362Disposals (354,621) (100,000) (354,621) (100,000)
Balance at end of year 4,823,221 5,163,561 4,588,315 4,928,655
Balance at beginning of year 40,853 - 40,853 -Depreciation charge for the year 42,925 40,853 42,925 40,853Disposals (3,681) - (3,681) -
80,097 40,853 80,097 40,853
At 31 December 2012 5,122,708 4,887,802
At 31 December 2011 5,056,204 4,821,298
All investment properties are held under freehold interest.
Investment properties were revalued in July 2008 by Messrs Jide Taiwo & Co, Estate Surveyors and Valuers. The market value at the date of the revaluation showed an amount of N14.2 billion and a force sales value of N10.6 billion.
The Company concluded that the forced sale value was more indicative of fair value at that time and accounted for the revaluation of properties in 2008 accordingly. This value formed the basis of the deemed cost adopted at 1/1/11 under IFRS.
The Company's total investment properties were revalued in December 2011, by Messrs Jide Taiwo & Co, Estate Surveyors and Valuers, at N16.7 billion on the basis of open market valuation. No subsequent external valuations have been undertaken. In December 2012, investment properties and leasehold land and buildings were internally revalued which amounted to N 20.68 billion.
The internal revaluation was derived by reference to the following:
- sales offers received from willing customers- market evidence of transaction prices for similar properties- the valuation by government upon which certain rates were paid.
The property rental income earned by the Group from its investment property, all of which is leased out under operating leases, amounted to N977.3 million (2011: N861 million). Direct operating expenses arising on the investment property in the period amounted to N462.1 million (2011: N389.2 million).
The Group The Company2011 2011N'000 N'000
Investment properties (Cost)
Accumulated Depreciation andImpairment Charge
Balance at end of year
Net book value:
2012 2012 N'000 N'000
4,743,124 4,508,218
5,122,708 4,887,802
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
53A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
2011 20 10N'000 N'000
7.Cost 7,212 7,212 7,212
The goodwill was tested for impairment and no indications of further impairment were observed after testing. Therefore, no impairment loss was recognised in 2012.
7.1 Analysis of Changes during the year 2011
Cost N'000
Balance at beginning and end of year 7,212 7,212
Carrying amountAt 31 December 7,212
Goodwill acquired in a business combination is allocated, at acquisition, to the cash generating units that are expected to benefit from that business combination. There were no indicators of impairment in goodwill during the period. Consequently, the impairment charge for 2012 was nil (2011: Nil).
7.2 Goodwill is allocated for impairment testing purposes to cash-generating units.
Before recognition of impairment losses, the carrying amount of goodwill (other than goodwill relating to discontinued operations) was allocated to cash generating units as follows:
2011 1/1/2011 N'000 N'000
Food and hospitality 4,186 4,186 4,186 Sales and servicing of engines 300 300 300
Rent and other services 2,726 2,726 2,726
7,212 7,212 7,212
Sales and Rent and Food and servicing otherhospitality of engines services
Cost 4,186 300 2,726 7,212Accumulated Impairment Loss (Note 7.1) - - - -
4,186 300 2,726 7,212
The recoverable amount of food and hospitality, sales and services of engines, and rent and other services cash generating units is determined on a value in use calculation which uses cash flow projection prepared by the management covering a five year period, and a discount rate of 15% per annum (2011: 15%).
Cash flow projections are determined using the compound annual growth rate methodology, taking cognisance of the last three years of performance of the cash generating units. The Directors believe that any reasonably possible change in the key assumptions on which the recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the cash generating units.
2012N'000
2012N'000
7,212
2012 N'000
Total
Goodwill (Group Only)
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
54A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The investments in subsidiaries are all stated at cost. In the opinion of the Directors the value of the unquoted investments is not lower than cost.
The Group owns 50% equity shares of Cummins West Africa Limited (CWAL) and consequently does not control more than half of the voting power of those shares. However, based on the contractual arrangements between the Group and other investors, CWAL Director of Operations and the Financial Controller reports directly to the Group Managing Director and Finance Director respectively, hence the Group has control over the financial and operating policies of the Company. Therefore, CWAL is controlled by the Group and is consolidated in these financial statements.
Abuja Capital Motors Limited Ordinary Shares Nigeria 71 71 71Cummins West Africa Limited Ordinary Shares Nigeria 50 50 50Guinea Construction Company Limited Ordinary Shares Nigeria 100 100 100Iddo Investment Limited Ordinary Shares Nigeria 100 100 100Leventis Foods Limited Ordinary Shares Nigeria 51 51 51Leventis Power Systems Limited Ordinary Shares Nigeria 100 100 100Victoria Beach Hotel Limited Ordinary Shares Nigeria 100 100 100TCN Properties Limited Ordinary Shares Nigeria 91 91 89
Place of
incorporation 2012 2011 1/1/2011 Subsidiaries Name Class of shares and operation % Holdings % Holdings % Holdings
8.
Details of the Group's subsidiaries at the end of the reporting period are as follows
Interest in subsidiaries (Company Only)
8.1 Details of principal activity and registered office Principal activity Location of registered office
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
55A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
An a
nal
ysis
of
the
move
men
t in
the
inve
stm
ent
in t
he
sub
sid
iaries
is
pre
sente
d b
elow
:
Ab
uja
C
ap
ital
Mo
tors
Li
mit
ed
N'0
00
Cu
mm
ins
West
Afr
ica
Lim
ited
N'0
00
Gu
inea
Co
nst
ruct
ion
C
om
pan
y Li
mit
ed
N'0
00
Idd
o In
vest
men
t Li
mit
ed
N'0
00
Leve
nti
s F
oo
ds
Lim
ited
N'0
00
Leve
nti
s Po
wer
Sys
tem
Li
mit
ed
N'0
00
Vic
tori
a
Beach
Ho
tel
Lim
ited
N'0
00
TC
N P
rop
ert
ies
Lim
ited
N'0
00
Tota
lN
'00
0l
1st
Jan
uar
y 201
1 (
as p
revi
ousl
y re
port
ed)
177,8
00
19
2,1
50
2,7
15
27,4
21
312,7
96
37
6,5
96
48,0
00
14
6,4
80
1,2
83
,95
8IF
RS
recl
assi
fica
tion
-
-
-
- -
(31
8,5
85)
-
- (3
18
,585)
1 J
anuar
y 201
1 (
rest
ated
)17
7,8
00
19
2,1
50
2,7
15
27
,42
13
12
,79
6
58
,01
14
8,0
00
14
6,4
80
At
31 D
ecem
ber
20
11
17
7,8
00
19
2,1
50
2,7
15
27
,42
13
12
,79
6
49
,21
34
8,0
00
14
6,4
80
At
31 D
ecem
ber
20
12
17
7,8
00
19
2,1
50
6,1
75
27
,42
13
12
,79
6
58
,01
14
8,0
00
14
6,4
80
IFRS
recl
assi
fica
tion r
elat
es t
o a
mount
due
to s
ub
sid
iaries
now
consi
der
as
dee
med
dis
trib
uti
on.
Su
mm
ary
in
vest
men
t in
su
bsi
dia
ries
Inve
stm
ent
in s
ub
sid
iaries
956
,57
596
5,3
73
96
8,8
33
Provi
sion
1
2,2
58
(
8,7
98
) (3
,460
)
95
6,5
75
9
65
,37
3
9
56
,57
5
9
68
,83
3
2
01
2
N
'00
0
96
8,8
33
Mo
vem
en
t
Th
e C
om
pan
y
2
01
10
1/0
1/1
1
N
'00
0
N'0
00
96
5,3
73
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
56A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Group The Company
The Group The Company
9.
Other Financial Assets comprise:
Joint Venture (Note 9.1) 138,660 132,379 - 75,000 100,000 - Investment in Other Associates (Note 9.2) - - - - - - Available for sale investment carried at Fair Value: - Quoted investments (Note 9.3) 9,734 4,208 9,897 9,734 4,208 9,897
136,587 9,897 104,208 9,897
9.1
The analysis below shows the investment position in Druckfarben Nigeria Limited:
Investment balance 1st January 132,379 100,000 100,000 100,000 Current year profit 31,281 32,379 - - Cash deposit for shares returned (25,000) - (25,000) -
132,379 100,000
The Company owns 50% equity shares of Druckfarben Nigeria Limited with both investors contributing equal membership to the Board. However, the Company did not control the operation of Druckfarben Nigeria Limited. As a result, the equity method has been applied while presenting the investment in the financial statement.
9.2
Quality Floor 50 50 50 50 50 50Royal Carpet 4,044 4,044 4,044 4,044 4,044 4,044Okomu Royal hotel 1 7,360 17,360 17,360 17,360 17,360 17,360
2 1,454 21,454 21,454 21,454 21,454 21,454Provision for diminution in value ( 2 1,454) (21,454) (21,454) (21,454) (21,454) (21,454)
- - - -
Other financial assets
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Joint Venture
The Group The Company 2011 2011 N'000 N'000
Statement of Financial Position
Total investment at 31 December
Investment in other associates 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Total investment at31 December
2012 2012 N'000 N'000
148,394 84,734
2012 2012 N'000 N'000
138,660 75,000
2012 2012 N'000 N'000
- -
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
57A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Group The Company
The Group The Company
9.3
Financial institutions At cost 42,422 42,422 42,422 42,422 42,422 42,422
42,422 42,422 42,422 42,422 42,422 42,422Provision for diminution in value (32,688) (38,214) (32,525) (32,688) (38,214) (32,525)
4,208 9,897 4,208 9,897
The market value of quoted investments as at 31 December 2012 was N9,734,012 (2011: 4,208,400).
10.
Raw materials 112,224 188,623 107,932 - - -Work in progress 102,894 70,358 83,288 22,062 13,409 26,244Finished goods 4,637,100 3,929,320 4,186,151 1,520,057 1,391,637 1,415,827Production spare parts 399,648 492,147 377,535 320,463 316,935 250,008Prior year adjustment
(Note 10.1) - (118,591) (65,306) - - -
4,561,857 4,689,600 1,721,981 1,692,079
10.1 The Company reviewed the basis of accounting for the stock of spare parts. This review indicated that there should have been additional costs charged to profit in respect of the use of these stocks that relate to periods prior to 31 December 2012. Accordingly an adjustment has been proposed as part of the opening statement of these financial statements (2011: N118.6 million, 2010: N65.3 million).
Inventories charged as expense. The cost of inventories recognised as an expense during the year in respect of continuing operations was N6.72 billion (31 December 2011: N7.91 billion).
Available for sale investment carried at fair value
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Quoted Investments
Market value at 31 December
Inventories
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
2012 2012 N'000 N'000
9,734 9,734
2012 2012 N'000 N'000
5,251,866 1,862,582
N
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
58A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
11.
Trade receivables 2,182,395 2,169,008 2,101,428 1,255,774 1,425,940 847,298Allowance for doubtful debts (trade receivables) (237,403) (468,924) (142,880) (111,760) (371,436) (57,134)
1,944,992 1,700,084 1,958,548 1,144,014 1,054,504 790,164Prepayments 355,923 281,939 297,052 137,179 153,052 99,808Other receivables (Note 11.2) 1,587,595 1,168,866 297,465 604,282 273,027 836,767Loan receivable (Note 11.3) - 346,442 370,815 1,644,019 1,590,018 1,367,249
3,497,331 2,923,880 3,070,601 3,093,988
11.2 Withholding tax 641,849 604,309 320,963 370,291 267,552 253,228Staff debtors 110,798 105,544 55,995 67,820 44,494 55,995Other debtors 924,311 586,231 30,312 219,444 51,848 607,663
1,676,958 1,296,084 407,270 657,555 363,894 916,886
Allowance for doubtful debts (89,363) (127,218) (109,805) (53,273) (90,867) (80,119)
1,168,866 297,465 273,027 836,767
Other debtors mainly represent non-trade dues from Group and related Companies. Energy Solution Business accounted for N317 million (2011: 496 million), Receivables for contracted warranty work also accounted for N98 million (2011: N40 million).
11.3
Loan due from related companies - 346,442 370,815 - 225,235 -Loan due from Group companies - - - 1,644,019 1,364,783 1,367,249
346,442 370,815 1,590,018 1,367,249
All loan receivables earn interest at the ruling market rate. The loan receivable for 2012 comprises the loan to Leventis Foods Limited and interest is charged on it at the ruling commercial rate for the year.
Trade and other receivables 2011 1/1/2011 2011 1/1/2011
N'000 N'000 N'000 N'000
Other receivables
Loan receivable
1/1/2011 1/1/2011 N'000 N'000
N
The Group The Company
2012 2012 N'000 N'000
3,888,510 3,529,494
1,587,595 604,282
2012 2012 N'000 N'000
- 1,644,019
2011 N'000
2011 N'000
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
59A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
The Group The Company
11.
11.4 The average credit period on sales of goods is 30 days. No interest is charged on the overdue receivables. The Group has recognised an allowance for doubtful debts of 100% against all receivables over 365 days because historical experience has been that receivables that are past due beyond 365 days are not recoverable. Allowances for doubtful debt are recognised against trade receivables between 30 and 365 days based on estimated irrecoverable amounts determined by reference to past default experience of the counterparty and an analysis of the counterparty's current financial position.
Before accepting any new customer, the Group uses an internal credit scoring system to assess the potential customer's credit quality and defines credit limit by customer. Limits and scoring attributed to customers are reviewed on a regular basis. 80% of the trade receivables that are neither past due nor impaired have the best credit scoring attributable under the internal credit scoring system used by the Group. Of the trade receivables balance at the end of the year, N760 million (31 December 2012: 527 million) is due from Nigerian Bottling Company Limited, the Group's largest customer. There are no other customers who represent more than 5% of the total balance of trade receivables.
Trade receivables disclosed above include amounts (see below for aged analysis) which are past due at the reporting date but against which the Group has recognised an allowance for doubtful receivables as stated above. The Group does not hold any collateral or other credit enhancements over these balances nor does it have a legal right of offset against any amounts owed by the Group to the counterparty. The average age of these receivables is 43 days (2011: 47 days).
Balance at the beginning of the period 468,924 142,880 100,695 371,436 57,134 29,441Amounts written off during the year as uncollectible 66,929 326,044 42,185 38,755 314,302 27,693Amounts recovered during the year (298,450) - - (298,431) - -
Balance at the end of the period 468,924 142,880 371,436 57,134
Balance at the beginning of the period 127,218 109,805 109,805 90,867 80,119 80,119Amounts written off during the year as uncollectible - 17,413 - - 10,748 -Amounts recovered during the year (37,855) - - (37,594) - -
Balance at the end of theperiod 127,218 109,805 90,867 80,119
In determining the recoverability of trade receivables the Group considers any change in the credit quality of the trade receivables from the date credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base being large and unrelated.
The Group does not hold any collateral over these balances.
Trade and other receivables (continued)
Movement in the allowance for doubtful debts
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Trade receivables
Other receivables - Withholding tax
N
2012 2012 N'000 N'000
237,403 111,760
89,363 53,273
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
60A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
11.
30-60 days 433,973 447,922 585,890 253,649 358,736 190,91060-90 days 125,125 53,930 300,492 30,841 156,360 45,72990-120 days 127,551 80,985 232,405 32,235 191,813 200,801120-180 days 159,152 123,451 122,420 21,635 74,675 54,896180-360 days 155,864 150,104 97,435 51,148 98,055 38,159
856,392 1,338,642 879,639 530,495
Average age (days) 44 34 54 56 45 53
2011 01/01/11 2011 01/01/11 N'000 N'000 N'000 N'000
30-60 days 294,986 239,033 102,374 173,552 87,390 86,29760-90 days 135,537 126,965 50,805 75,421 48,701 43,21990-120 days 59,331 45,981 28,713 45,117 29,229 23,121120-180 days 33,678 43,236 15,643 10,817 7,337 12,077180-360 days 28,954 21,876 13,623 12,111 4,028 8,395
477,091 211,158 176,685 173,109
The Directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
2011 01/01/11 2011 01/01/11 N'000 N'000 N'000 N'000
Ageing of impaired trade receivables30-360 days (64,204) (69,567) (42,188) (51,798) (48,906) (27,693)360+ days (173,199) (399,357) (100,692) (59,962) (322,530) (29,441)
(468,924) (142,880) (371,436) (57,134)
30-360 days - (40,537) (38,313) - (28,999) (22,164)360+ days (89,363) (86,681) (71,492) (53,273) (61,868) (57,955)
(127,218) (109,805) (90,867) (80,119)
Trade and other receivables (continued)
Aged trade receivables that are past due but not impaired
The Group The Company 2011 01/01/11 2011 01/01/11 N'000 N'000 N'000 N'000
Total
Aged withholding tax that are past due but not impaired
Total
Ageing of impaired withholding tax
2012 2012 N'000 N'000
1,001,665 389,508
2012 2012 N'000 N'000
552,486 317,018
2012 2012 N'000 N'000
(237,403) (111,760)
(89,363) (53,273)
The Group The Company
The Group The Company
CO
RP
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PR
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DIR
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
61A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
'000 N'000N N'000 N'000 N'000 N'000
12.
Cash and bank balances 1,847,013 987,638 1,227,275 1,567,834 819,366 354,092Bank overdrafts (Note 21) (2,012,239) (1,094,066) (538,785) (506,173) (258,197) (6,428)
(106,428) 688,490 561,169 347,664
Cash and cash equivalents comprise cash and short-term bank deposits with an original maturity of three months or less, net of outstanding bank overdrafts. The carrying amount of these assets is approximately equal to their fair value.
13.
2,700,000,000 ordinary shares of 50 Kobo each 1,350,000 1,350,000 1,350,000 1,350,000
:2,647,290,305 ordinary shares of 50 Kobo each 1,323,645 1,323,645 1,323,645 1,323,645
The Company has one class of ordinary shares which carry no right to fixed income, carry one vote per share and carry a right to dividends.
14.
Balance at end of year 210,548 210,548 210,548 210,548 210,548 210,548
The share premium arose from the issuance of shares in prior years, net of listing expenses.
15.
Balance at the beginning of year 4,321,069 4,318,896 4,318,896 4,304,342 4,318,896 4,318,896Transferred from other comprehensive income 33,379 2,173 - 38,052 (14,554) -
Balance at end of year 4,321,069 4,318,896 4,304,342 4,318,896
Other reserves comprise the uplift in value of investment properties recognised at valuation under the previous GAAP, which has been used as the basis for the deemed cost at the date of transition to IFRS. It also includes amounts relating to actuarial gains and losses on defined benefit plan scheme and reserve movements relating
Cash and cash equivalents The Group The Company
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Share capital The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Authorised:
Issued and fully paid
Share premium The Group The Company
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Other reserves The Group The Company 2011 1/1/2011 2011 1/1/2011
2012 2012 N'000 N'000
(165,226) 1,061,661
2012 2012 N'000 N'000
1,350,000 1,350,000
1,323,645 1,323,645
2012 2012 N'000 N'000
2012 2012
4,354,448 4,342,394
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
62A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
16. Retained earnings
Reserves are derived from:
Investment Property revaluation under previous GAAP 4,321,069 4,318,896 4,318,896 4,304,342 4,318,896 4,318,896 Actuarial results 27,853 7,862 - 32,526 (8,865) - Available for Sale Financial - - - - - - Assets Revaluation Reserves 5,526 (5,689) - 5,526 (5,689) -
4,321,069 4,318,896 4,304,342 4,318,896
Balance at beginning of year as restated (Note 16.1) 3,574,030 3,329,477 3,058,584 2,665,909Attributable profit for the year ended 31 December 734,252 562,228 1,118,993 710,350Payment of dividends (370,621) (317,675) (370,621) (317,675)
3,574,030 3,058,584
The opening retained earnings at 1 January 2011 reflects the effects of a prior year adjustment and IFRS adjustments described at Note 16.1. Full details of the prior year adjustment and IFRS adjustments and reconciliation between the previously stated opening retained earnings under Nigeria GAAP and the restated IFRS adjusted figures is included in the reconciliation statement.
16.1
16.1Retained earnings as per previous GAAP 3,287,547 2,397,032Prior year adjustment (Note 44.4.2) (58,851) -
Retained earnings as restated 3,228,696 2,397,032
IFRS reclassification (Note 44.2.8) 220,263 -IFRS transition adjustment (Note 44.5.3) (119,482) 268,877
2,665,909
16.2 The prior year adjustment relates to adjustment in the basis of accounting for the attributable value of utilised stock of spare parts totalling N63 million. This review indicated that there should have been additional costs charged to profit in respect of the utilisation of these stocks that relates to prior years. The amount has been compensated by an adjustment in the non-controlling interest for N6 million.
16.3 On 9 July 2012, dividend of 14 Kobo per share amounting to N38,903,142 net of tax were paid to the local shareholders. The sum of N293,664,000 payable to the overseas shareholders is still outstanding (Note 22.1). (2011: 12 Kobo per share being dividend declared in 2010 to all shareholders totalling N317,674,926 were paid).
16.4 The Directors propose a final dividend of 14 Kobo per share to be paid to the shareholders. This dividend will be subject to approval by shareholders at the Annual General Meeting and has not been included as liability in these financial statements. The total estimated final dividend to be paid is N370,620,643.70. The payment will be subject to appropriate withholding tax.
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
The Group The Company
2011 2011 N'000 N'000
Balance at end of year
Reconciliation of retained earningThe Group The Company
01/01/11 N'000
Reconciliation of retained earning
Retained earnings as per IFRS
2012 2012 N'000 N'000
4,354,448 4,342,394
2012 2012 N'000 N'000
3,937,661 3,806,956
01/01/11 N'000
3,329,477
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
Property, plant and
equipmentN'000
Retirement benefit
obligationsN'000
Unrealised exchange
(gain)/lossN'000
Investment properties
N'000Total
N'000
Property, plant and
equipmentN'000
Investment properties
N'000
Finance lease
N'000
17. Non-controlling interests
63A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Finance lease
N'000
Retirement benefit
obligationsN'000
Unrealised exchange
(gain)/lossN'000
TotalN'000
16.5 Other prior year adjustment relates to correction of goodwill and non-controlling
Balance at beginning of year 855,489 1,076,162Share of profit for the year (450,083) (233,585)Other Comprehensive income (2,679) 12,912
Balance at end of year 855,489
18.
The following are the major deferred tax liabilities and assets recognised by the Group and movements thereon during the current and prior reporting period.
At 1 January 662,406 493,786 803,432 679,472 470,586 569,274Recognised in profit or loss (Note 31) (121,404) 159,717 (309,646) 15,628 212,685 (71,402)Recognised directly in Statementof Comprehensive Income 10,735 8,903 - 13,940 (3,799) (27,287)
662,406 493,786 679,472 470,585
At 1 January (255,594) 591,918 (189,278) 18,304 497,056 662,406Recognised to profit or loss (53,342) 25,142 3,983 (41,508) (55,679) (121,404)Recognised in Statement ofComprehensive income - - 10,735 - - 10,736
As 31 December (308,936) 617,060 (174,560) (23,204) 441,377
At 1 January 60,956 - (74,257) 10,031 497,056 493,786Charge to profit or los (316,191) 591,918 (124,282) 8,272 - 159,717Recognised in Statement of Comprehensive income - - 8,903 - - 8,903
(255,235) 591,918 (189,636) 18,303 497,056
interests.
The Group 2011
N'000
Deferred tax liabilities
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
As 31 December
Deferred tax assets/liabilities in relation to:
The Group
2012
2011
As 31 December
2012 N'000
402,727
2012 2012 N'000 N'000
551,737 709,040
551,737
662,406
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
64A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Property, plant and
equipmentN'000
Finance lease
N'000
Retirement benefit
obligationsN'000
Unrealised exchange
(gain)/lossN'000
Investment properties
N'000Total
N'000
Property, plant and
equipmentN'000
Finance lease
N'000
Retirement benefit
obligationsN'000
Unrealised exchange
(gain)/lossN'000
Investment properties
N'000Total
N'000
The Company
2012
As 31 December
2011
As 31 December
The Group The Company
The Group
At 1 January (256,220) 591,918 (146,490) 8,273 481,991 679,472Recognised to profit or loss 83,289 25,142 7,915 (14,910) (85,808) 15,628Recognised in Statementof Comprehensive income - - 13,940 - - 13,940
(172,931) 617,060 (124,635) (6,637) 396,183
At 1 January 15,881 - (27,286) - 481,991 470,586Recognised to profit or loss (272,101) 591,918 (115,405) 8,273 - 212,685Recognised in Statement ofComprehensive income - - (3,799) - - (3,799)
(256,220) 591,918 (146,490) 8,273 481,991
Deferred tax assets and liabilities are offset where the Group has a legally enforceable right to do so. The following is the analysis of the deferred tax balances (after offset) for financial reporting purposes:
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Deferred tax liabilities 898,935 753,221 578,608 840,281 704,276 569,274 Deferred tax assets (347,198) (90,815) (84,822) (131,241) (24,804) (98,689)
662,406 493,786 679,472 470,585
2011 N'000
Deductible temporary differences, unused tax losses and unused tax credits for which no deferred tax assets have been recognised are attributable to the following: - tax losses (revenue in nature) 1,515,004 808,034- tax losses (capital in nature) - -- unused tax credits - -- deductible temporary differences - -
1,515,004 808,034
709,040
679,472
2012 2012 N'000 N'000
551,737 709,040
2012 N'000
18.1 Unrecognised deductible temporary differences, unused tax losses and unused tax credits
Deferred tax assets/liabilities in relation to:
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
65A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
19.
19.1
The Group operates defined contribution retirement benefit plans for all qualifying employees of A.G. Leventis (Nigeria) Plc and its subsidiaries. The assets of the plans are held separately from those of the Group in funds under the control of trustees. Where employees leave the plans prior to full vesting of the contributions, the contributions payable by the Group are reduced by the amount of forfeited contributions.
The employees of the Group are members of a state-managed retirement benefit plan operated by the government of Nigeria. A.G. Leventis (Nigeria) Plc and its subsidiaries are required to contribute a specified percentage of payroll costs to the retirement benefit scheme to fund the benefits. The only obligation of the Group with respect to the retirement benefit plan is to make the specified contributions.
The total expense recognised in profit or loss of N100.3 million (2011: N81.4 million) represents contributions payable to these plans by the Group at rates specified in the rules of the plans.
19.2
The Group operates an unfunded gratuity scheme for qualifying employees. Under the plan, the employees are entitled to a retirement benefit depending on the number of years put in to service. No other post-retirement benefits are provided to the employees.
The most recent actuarial valuation of the present value of the unfunded defined benefit obligation was carried out at 31 December 2012 by H R Nigeria Limited, Consultants and Actuaries (A Member of Abelica Global).
Analysis of the entitlement to employee in this scheme is as tabulated below:
Less than 5 years Nil5 years but less than 10 years 6 weeks of annual basic salary for each year of service10 years but less than 13 years 7 weeks of annual basic salary for each year of service13 years and above 8 weeks of annual total emolument for each year of service
The present value of the defined benefit obligation, and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.
The liability for the staff was calculated by adding the employee's (calculated) annualised contribution for the year in line with the benefit structure.
19.3.1
The principal assumptions used for the purposes of the actuarial valuation were as follows:
Long term average discount rate (p.a) 13 14Average Pay Increase (p.a) 13 13Average rate of inflation (p.a) 10 10
Employee benefits
Defined contribution plan
Defined benefit plan
Number of years of service Benefit
Financial Assumptions
as at 2012 as at 2011
% %
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
66A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
19.3.2
Mortality in Service
The rates of mortality assumed for employees are the rates published in the A67/70 tables, published jointly by the institute and the Faculty of Actuaries in the UK.
25 730 735 940 1445 26
Withdrawal from Service
Less than or equal to 30 5.0 31-39 5.0 40-44 4.0 45-50 2.0 51-55 1.0 51 and above 0.0
19.4
The amount included in the consolidated statement of financial position arising from the Group's obligation in respect of its defined benefit plan is as follows:
Present value of unfunded defined benefit obligation 671,584 763,883 739,640 415,346 488,306 451,837Fair value of plan assets - - - - - -
Demographic assumptions
Number of deaths in a year of age out of 10,000 lives
Rate (%)
Amount included in the statement of financial position
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Net liability arising from defined benefit obligation 671,584 763,883 739,640 415,346 488,306 451,837
Sample age
Age band
2012 2012 N'000 N'000
CO
RP
OR
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
67A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
19.5 Movement in the Present Value of defined benefit obligations in the current year is as follows:
763,883 739,640 488,306 451,837Current service cost 74,318 97,915 39,629 49,352Interest cost - - - -Past service cost - - - -Curtailment (gains) (78,277) - (50,182) -Expected return on plan asset - - - -Actuarial (gains)/losses - change in assumption 3,265 (1,514) 1,896 (746)Actuarial (gains)/losses - experience (39,227) (28,163) (48,362) 13,410Plan settlements - - - -Benefits paid out (52,378) (43,995) (15,940) (25,547)
671,584 763,883 415,347 488,306
As at the date of the valuation, no external fund has been set up from which payments can be disbursed.
19.6 Amounts recognised in profit or loss in respect of these defined benefit plans are as follows:
Current Service cost 74,318 97,915 39,629 49,352Interest Cost - - - -Past Service cost - - - -Curtailment (Gains) (78,277) - (50,182) -Expected Return on Plan asset - - - - Net (Gain)/Charge (3,959) 97,915 (10,553) 49,352
Amounts recognised in the other comprehensive income in respect of these defined benefit plans are as follows:
Actuarial (gains)/losses - change in assumption 3,265 (1,514) 1,896 (746)Actuarial (gains)/losses - experience (39,228) (28,163) (48,362) 13,410 Amount taken to OCI for the period (35,963) (29,677) (46,466) 12,664Tax 10,789 8,903 13,940 (3,799) Net (20,774) 8,865
Had the plan been discontinued as at 31 December 2012, the estimated value of the accrued benefits payable is N671.6 million.
The Group The Company 2011 2011 N'000 N'000
Balance as at 1 January
Balance as at 31 December
The Group The Company 2011 2011 N'000 N'000
The Group The Company 2011 2011
N'000 N'000
2012 2012 N'000 N'000
2012 2012 N'000 N'000
2012 2012 N'000 N'000
(25,174) (32,526)
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
Present value of minimum lease payments
Present value of minimum lease payments
68A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
19.7 As the scheme is not funded, there were no plan assets. The Group does not expect to make any contribution to a separate Defined Benefit Plan in the next financial year.
20.
The Group leased certain of its motor vehicle under finance leases (Note 5.4). The average lease term is 7 years. The Group has options to purchase the motor vehicles for a nominal amount at the end of the lease terms. The Group's obligations under finance leases are secured by the lessors' title to the leased assets.
Interest rate underlying all obligations under finance leases are fixed at respective contract rates ranging from 14% to 18% (2011: 14% to 18%) per annum.
Finance lease liabilities
Leasing arrangement
Amounts payable under finance leases:
Amounts payable under finance leases:
Not later than one year 618,646 567,102 459,578 618,646 562,714 459,578Later than one year and not later than five years 1,305,335 1,818,269 698,199 1,305,335 1,818,269 698,199
Present value of lease obligations 1,923,981 2,385,371 1,157,777 1,923,981 2,380,983 1,157,777Less: Future finance charges (725,284) (871,305) (448,637) (725,284) (869,235) (448,637)
1,514,066 709,140 1,511,748 709,140
Not later than one year 326,832 299,601 242,796 326,832 297,283 242,796Later than one year and not later than five years 871,865 1,214,465 466,344 871,865 1,214,465 466,344
1,514,066 709,140 1,511,748 709,140
Short term portion of Finance Lease liabilities 326,832 299,601 242,796 326,832 297,283 242,796
Finance lease liabilities 871,865 1,214,465 466,344 871,865 1,214,465 466,344
1,514,066 709,140 1,511,748 709,140
All lease obligations are denominated in Naira. The present value of minimum lease payment is approximately equal to their carrying amount.
The Group The Company Minimum lease payments Minimum lease payments 2011 1/1/2011 2011 1/1/2011
N'000 N'000 N'000 N'000
Present value of lease obligations
2011 1/1/2011 2011 1 /1/2011 N'000 N'000 N'000 N'000
Present value of lease obligations
Included in the financial statementsare the following amounts:
Non-current liabilities:
2012 2012 N'000 N'000
1,198,697 1,198,697
2012 2012 N'000 N'000
1,198,697 1,198,697
1,198,697 1,198,697
Present value of minimum lease payments Present value of
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
69A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
21.Bank overdrafts (Note 12) 2,012,239 1,094,066 538,785 506,173 258,197 6,428Short term bank loans (Note 21.1) - 111,513 356,523 - - -
1,205,579 895,308 258,197 6,428
21.1 Short term facilities were obtained from Fidelity Bank Plc and Finbank Plc for 36 months and 30 months at interest rates of 10% and 12% respectively. The balances were repaid from cash flow generated from the operation of the Company and were not secured.
The carrying amounts of bank overdrafts and loans are approximately equal to their fair value.
22.
Trade payables 3,723,804 3,337,461 3,153,915 779,426 1,078,567 1,042,821Amounts due to subsidiaries - - - 81,405 98,516 200,278Amounts due to related entities 149,452 194,308 104,599 146,866 179,179 83,393Dividend payable 293,664 208 208 293,664 208 208Other taxes 35,582 42,771 29,278 31,717 39,916 26,984Value added tax payable 326,430 227,845 232,616 82,322 2,899 16,245Other payables 589,487 631,037 859,348 317,778 330,564 279,541Accruals 1,313,418 817,270 638,454 328,761 338,370 331,608Staff pension 36,004 36,904 40,356 12,273 22,588 20,975
5,287,804 5,058,774 2,090,807 2,002,053
22.1
Final dividend prior year (Note 16) 370,621 317,675 264,729 370,621 317,675 264,729Paid during the year (77,165) (317,675) (264,729) (77,165) (317,675) (264,729)
Unpaid dividend during the year 293,456 - - 293,456 - -
Amounts remaining unpaid from prior years 208 208 208 208 208 208
208 208 208 208
22.2 Trade creditors and accruals principally comprise amounts outstanding for trade purchases and ongoing costs. No interest is charged on the outstanding balances. However, the Group has financial risk management policies in place to ensure that all payables are paid within the pre-agreed credit terms.
The increase in accruals relates mainly to the technical fee payable to technical partners in Leventis Foods Limited and Cummins West Africa Limited.
Other creditors relate mainly to advance payment from customers and other taxes refers to P.A.Y.E. and withholding tax payable outstanding at year end.
2012 2012 N'000 N'000
2,012,239 506,173
2012 2012 N'000 N'000
6,467,841 2,074,212
293,664 293,664
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Borrowings - all unsecured
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Trade and other payables
Dividend payable
The Group The Company
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
Rent received in advance 434,835 402,679 403,457 387,117 306,488 318,125 Service agreement contract received in advance 225,382 286,575 424,739 - - -
689,254 828,196 306,488 318,125
Income received in advance represents rent from customers from Real Estate Division of the Company and payment for service agreement for engines received in advance at Cummins West Africa Limited.
24.
The following is an analysis of the Group's revenue for the year from continuing operations (excluding investment income - Note 25).
Revenue from sales of goods 9,593,815 11,299,637 3,266,580 4,825,267Revenue from rendering of services 5,356,969 5,460,848 2,958,572 2,509,350Rent and other services 1,352,169 1,334,698 1,290,202 1,166,438
18,095,183 8,501,055
Revenue represents the invoiced value of goods sold, service rendered and rental income, and is stated net of VAT.
25.
Products and services from which reportable segments derive their revenues.
Information reported to the entity's Chief Executive for the purposes of resource allocation and assessment of segment performance focuses on the category of products or services for each type of activity. The principal categories of products/services are Food and hospitality, Sales, transportation and servicing of engines and Rent and other services. The Directors of the Company have chosen to organise the Group around differences in product and services.
Specifically, the Group's reportable segments under IFRS 8 are as follows:
Food and hospitality - Hotel management and sales of bread and pastries
Sales, transportation and servicing of engines - Sales and servicing of trucks, buses, heavy equipment, generators and other power equipment
Rent and other services - Renting out of residential and commercial properties
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Revenue
The Group The Company 2011 2011 N'000 N'000
Segment information
2012 2012 N'000 N'000
660,217 387,117
2012 2012 N'000 N'000
16,302,953 7,515,354
70A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
23. Deferred revenue
25.1
Food and hospitality 3,586,132 3,487,696 - -Sales, transportation and servicing of engines 11,364,652 13,272,789 6,225,152 7,334,617Rent and other services 1,352,169 1,334,698 1,290,202 1,166,438
18,095,183 8,501,055
Food and hospitality (383,993) (391,321) - -Sales, transportation and servicing of engines 319,171 725,720 742,063 650,520Rent and other services 490,512 469,367 423,690 391,939
425,690 803,766 1,165,753 1,042,459
Share of profit from joint venture 31,281 32,379 - -Investment income 182,262 135,008 334,546 193,961Other gain and losses 450,043 167,146 356,187 66,946Finance costs (436,429) (314,767) (258,445) (172,929)
Profit before tax (continuing operations) 823,532 1,130,437
Segment revenue reported above represents revenue generated from external customers.
The accounting policies of the reportable segments are the same as the Group's accounting policies described in Note 3. Segment profit represents the profit earned by each segment after allocation of central administration costs, share of profits of joint venture and associates, gain recognised on disposal of interest in former associate, investment income, other gains and losses, finance costs and income tax expense. This is the measure reported to the Chief Executive Officers for the purposes of resource allocation and assessment of segment performance.
25.2
Food and hospitality 3,842,263 3,967,180 4,033,186 - - -Sales, transportation and servicing of engines 10,146,108 9,227,868 7,610,043 4,258,867 4,220,198 3,320,013Rent and other services 8,308,795 7,555,726 7,837,444 10,182,825 9,471,529 8,402,596
22,297,166 20,750,774 19,480,673 14,441,692 13,691,727 11,722,609
Unallocated 495,594 218,604 94,719 1,184,810 852,080 1,073,957
20,969,378 19,575,392 14,543,807 12,796,566
Segment revenues and results The Group The Company 2011 2011
N'000 N'000
Revenue
Segment profit
Total for continuing operations
Group segment assets and liabilities The Group The Company 2011 01/01/11 2011 01/01/11 N'000 N'000 N'000 N'000
Segment assets
2012 2012 N'000 N'000
16,302,953 7,515,354
652,847 1,598,041
2012 2012 N'000 N'000
22,792,760 15,626,502
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
71A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
72A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Food and hospitality 1,039,238 472,044 385,657 - - -Sales, transportation and servicing of engines 6,771,743 6,194,412 5,858,213 2,924,928 2,787,219 2,296,209Rent and other services 1,833,599 2,059,342 1,598,993 1,671,577 1,896,996 1,405,657
9,644,580 8,725,798 7,842,863 4,596,505 4,684,215 3,701,866
Unallocated 2,911,174 1,958,799 1,473,916 1,346,454 962,473 575,702
10,684,597 9,316,779 5,646,688 4,277,568
All assets are allocated to reportable segments other than interests in associates, 'other financial assets', and current and deferred tax assets. Goodwill is allocated to reportable segments as described in Note 7.2. Assets used jointly by reportable segments are allocated on the basis of the revenues earned by individual reportable segments; and all liabilities are allocated to reportable segments other than borrowings, 'other financial liabilities', and current and deferred tax liabilities. Liabilities for which reportable segments are jointly liable are allocated in proportion to segment assets.
25.3
Food and hospitality 236,967 390,325 367,769 - - -Sales, transportation andservicing of engines 556,545 455,725 243,472 453,176 346,240 129,167Rent and other services 218,578 173,630 179,521 205,531 164,445 172,199 1,019,680 790,762 510,685 301,366
25.4
Included in revenues arising from direct sales, transportation and services of engines of N11.4 billion (2011: N13.3 billion), Food and hospitality of N3.6 billion (2011: N3.5 billion) and Rental and other services of N1.4 billion (2011: N1.1 billion) are revenues of approximately N3.6 billion (2011: N3.4 billion) which arose from sales to the Group's largest customer. No other single customers contributed 10% or more to the Group's revenue for both 2011 and 2012.
2012 2012 N'000 N'000
12,555,754 5,942,959
2012 2012 N'000 N'000
1,012,090 658,707
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Segment liabilities
For the purposes of monitoring segment performance and allocating resources between segments:
Other segments information Depreciation and amortisation
The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Information about major customers
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
73A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
25.5
Food and hospitality 164,836 137,172 318,549 - - -Sales, transportation and servicing of engines 672,552 1,565,043 1,157,448 534,631 1,426,206 1,107,416Rent and other services 280,007 451,435 172,394 262,487 428,274 171,532
2,153,650 1,648,391 1,854,480 1,278,948
25.6
Inter-segment sales are charged at prevailing market prices.
The following is an analysis of the Group's revenue and results by reportable segment in 2012:
RevenueExternal sales 3,586,132 11,364,652 1,352,169 16,302,953Inter-segment sales 22,554 65,173 146,184 233,911
11,429,825 16,536,864
The following is an analysis of the Company's revenue and results by reportable segment in 2011:
RevenueExternal sales 3,487,696 13,272,789 1,334,698 18,095,183Inter-segment sales - 47,781 116,449 164,230
13,320,570 18,259,413
25.7 As all of the Company's operations are derived from within Nigeria, no geographical analysis is presented.
Additions to non-current assets The Group The Company 2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Segment revenues and results
Sales,transportation Rent and
Food and and servicing other servicesSegment hospitality of engines Total
2012 2012 N'000 N'000
Total Revenue
Sales, transportation Rent and
Food and and servicing other servicesSegment hospitality of engines Total
2011 2011 N'000 N'000
Total Revenue
2012 2012 N'000 N'000
1,117,395 797,118
2012 2012 N'000 N'000
3,608,686 1,498,353
2011 2011 N'000 N'000
3,487,696 1,451,147
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
74A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
26.
26.1
Salaries and allowances 1,007,711 901,271 577,414 523,019Other related staff cost 161,016 134,933 63,859 54,582Workshop and maintenance 5,269,664 6,658,550 3,584,627 4,712,045Rental services 440,826 389,190 440,826 389,190Depreciation 708,285 759,837 522,902 388,513Generator cost of sales 2,647,712 2,704,136 - -Central workshop and spare parts 558,585 398,214 - -Technical fee 143,628 160,889 - -Raw material cost 1,920,992 2,118,460 - -
14,225,480 6,067,349
26.2
Staff salaries and allowances 460,137 399,837 143,580 126,060Other related staff cost 107,491 97,730 12,081 10,842Rent, rates and service charges 148,633 144,452 16,759 16,612Travel and subsistence 80,223 77,124 25,313 25,501Telephone, postages and courier 34,338 32,885 16,352 13,007Insurance 11,790 7,385 - -Repairs and maintenance 222,284 224,349 5,057 7,934Other expenses 23,341 25,131 487 714Bad debt provisions 66,929 343,457 38,755 325,050Advert and promotions 146,625 84,407 2,931 388
1,436,757 526,108
26.3
Directors' remuneration 62,912 50,762 57,677 44,913Staff salaries and allowances 576,528 501,267 378,572 327,658Other staff related cost 223,293 270,032 176,256 191,086Rent, rates and service charges 41,786 68,465 28,275 60,127Legal, administration and others 19,058 21,149 55,784 82,097Administrative charges 196,569 213,891 (196,569) (213,890)Insurance 53,063 23,687 27,989 23,687Telephone, postages and courier 76,357 52,616 50,893 52,421Audit fee 25,740 22,880 11,362 10,100Repairs and maintenance 99,055 111,057 91,895 97,704Travel and subsistence 131,197 108,947 117,299 107,917Depreciation 211,496 184,427 99,225 81,319
1,629,180 865,139
Expenses by natureThe Group The Company
2011 2011 N'000 N'000
COST OF SALES:
SELLING AND DISTRIBUTION:
ADMINISTRATIVE EXPENSES:
2012 2012 N'000 N'000
12,858,419 5,189,628
1,301,791 261,315
1,717,054 898,658
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
75A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Interest on obligation under finance lease 199,438 150,705 199,438 150,705
314,767 172,929
The weighted average capitalisation rate on funds borrowed generally is 14% per annum (2011: 12.5% per annum).
436,429 258,445
29.
Interest on bank overdrafts and loan 236,991 164,062 58,098 19,020 Interest on loans from related party - - 909 3,20
Finance costs The Group The Company 2011 2011 N'000 N'000 2012 2012 N'000 N'000
27.
Interest received on bank deposits 182,262 135,008 141,329 124,183 Interest received on intercompany loans 193,217 69,585 Dividend income - 887 - 193
135,895 193,961
Interest received represents interest earned on deposit with banks during the year at an average rate of 12% p.a.
2011 2011 N'000 N'000
28.
Gains on disposal of property, plant and equipment 6,378 10,165 2,210 2,649Gains/(losses) on disposal of investment properties (Note 28.2) 3,504 (10,000) 3,504 (10,000)Net foreign exchange gain 117,907 72,438 56,839 52,811Bad debt recovered 298,450 - 292,905 -Other income (Note 28.1) 13,922 93,656 5,526 21,486
166,259 66,946
28.1 Other income refers to sales of scrap, minor rental income and is stated net of provision for non-core business losses from subsidiaries.
28.2 During the year, certain items of investment properties were disposed off. The analysis of this disposal is presented below:
2011 2011 N'000 N'000
Historical cost of investment properties disposed 3,750 3,750
Deemed cost incorporating historical valuation 350,940 100,000 350,940 100,000 Net disposal proceeds from investment (354,444) (90,000) (354,444) (90,000)
(Profit)/loss on disposal of investment properties 10,000 10,000
The Group The Company 2011 2011 N'000 N'000
Investment income
The Group The Company
Other gains and losses
The Group The Company
2012 2012 N'000 N'000
182,262 334,546
2012 2012 N'000 N'000
450,043 356,187
2012 2012 N'000 N'000
90,121 90,121
(3,504) (3,504)
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
76A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
30. Profit before tax
31.1 Current tax
Directors' emoluments 89,936 47,288 89,936 44,913Audit fee 25,740 22,880 11,362 10,100Profit on sale of fixed assets (6,378) (10,165) (2,210) (2,649)Exchange gain (117,907) (72,438) (56,839) (52,811)Impairment of investments (5,526) 5,689 (17,784) 14,487Depreciation of property plant and equipment 969,165 1,019,320 510,324 613,782
31.
In respect of the current year:Income tax charged at 30% 424,625 284,787 397,722 167,861Education tax 48,883 43,912 45,562 33,066Capital gains tax 23,164 8,250 23,164 8,251
496,672 336,949 466,448 209,178In respect of prior years:(Over)/Under provision in prior year (6,591) (1,777) (3,028) (1,776)
490,081 335,172 463,420 207,402
In respect of the current year (Note 18): (121,404) 159,717 15,628 212,685
494,889 420,087
31.2 Balance as at 1 January 470,790 507,113 286,866 220,711Adjustment (Note 31.3) (27,693) - (31,255) -Charge for the year 490,081 335,172 463,420 207,402Payment during the year (146,603) (296,305) (57,564) (70,445)Withholding tax utilised (140,334) (75,190) (140,335) (70,802)
470,790 286,866
The Group The Company 2011 2011 N'000 N’000
Income tax expense Income tax recognised in profit and loss
The Group The Company 2011 2011 N'000 N'000
Deferred taxation
Total Income Tax expense in current year relating to continuing operations
Income tax liability
Tax liability as at 31 December
2012 2012 N'000 N'000
2012 2012 N'000 N'000
368,677 479,048
646,241 521,132
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
77A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
31.3 Adjustment relates to withholding tax utilised in prior years now accounted for.
The Group The Company 2011 2011
N’000 N'000 2012 2012 N'000 N'000
The income tax expense for the year can be reconciled to the accounting profit as follows: Profit before tax from continuing operations 652,846 823,532 1,598,041 1,130,437
Income tax expense calculated at 32% (2011: 32%) 208,911 263,530 511,374 361,740Effect of income that is exempt from taxation (10,010) (15,828) - -Effect of expenses that are not deductible in determining taxable profit - 39,180 - 9,679Effect of unused tax losses and tax offsets not recognised as deferred tax assets 212,091 207,950 - 35,351Effect of previously unused tax offsets now recognised as deferred tax assets (62,644) (31,562) (62,644) -Effect of utilising minimum tax provisions 5,045 2,764 - -Effect of deferred tax on other reserve items 17,339 4,635 19,234 4,635Others (includes effect of capital gains tax and education tax at different rates) 35,364 25,996 14,112 10,458Other adjustments (30,829) - - -Effect of prior year over/(under) provision (6,590) (1,776) (3,028) (1,776)
368,677 494,889 479,048 420,087
Income tax expense recognised in profit or loss (relating to continuing operations) 368,677 494,889 479,048 420,087
The tax rate used for the 2011 and 2010 reconciliations above is the corporate tax rate of 30% payable by corporate entities 494,889 420,087368,677 479,048
The Group The Company 2011 2011
N'000 N'000 2012 2012 N'000 N'000
Net profit attributable to equity holders of the parent 734,252 562,228 1,118,993 710,350
Earnings from continuing operations for the purpose of basic and diluted earnings per share excluding discontinued operations 562,228 710,350734,252 1,118,993
32. Earnings per share
32.1 Basic earnings per share from continuing operations
The denominators used are the same as those detailed above for both basic and diluted earnings per share from
continuing and discontinued operations.
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
Basic EPS (Kobo) 21 27 28 42
Weighted average number of ordinary shares for the purposes of basic and diluted earninngs per shares 2,647,290 2,647,2902,647,290 2,647,290
33. Reconciliation of Profit after taxation to Net Cash Generated by Operating Activities
32. Earnings per share (continued)
The Group The Company Notes 2011 2011
N'000 N'000 2012 2012
N'000 N'000
The Company did not issue any ordinary shares with dilutive potential during the year ended 31 December 2012(or 31 December 2011)
The Group The Company 2011 2011
N'000 N'000 2012 2012
N'000 N'000
The Group The Company 2011 2011 2012 2012
Profit after taxation 284,169 328,643 1,118,993 710,350
Income tax expense recognised in profit and loss 368,677 494,889 479,048 420,087Depreciation 1,012,090 1,019,680 658,707 510,685Bad debt provision 69,929 343,457 38,755 325,050Utilisation of withholding tax (27,693) - (31,255) -Share of profit of joint venture (31,281) (32,379) - -Finance cost 436,429 314,767 258,445 172,929Investment income (182,262) (135,895) (334,546) (193,961)Profit on sale of property, plant and equipment (6,378) (10,165) (2,210) (2,649)Profit on sale of investment property (3,504) 10,000 (3,504) 10,000Actuarial gain/(loss) on gratuity scheme 25,174 20,774 32,526 (8,865)Fair value change in available for sale 5,526 (5,689) 5,526 (5,689)Tax charged to other comprehensive income 10,789 8,903 13,940 (3,799)Net transfer of property, plant and equipment 5 126,393 - 126,393 -Spare parts transfer to property, plant and equipment 5 (4,279) (1,637) - -Diminution in long term investment (5,526) 5,689 (17,784) 14,487
2,078,253 2,361,037 2,343,034 1,948,635
(Increase)/decrease in inventory (690,009) 127,742 (140,602) (29,902)(Increase)/decrease in trade and other receivables (461,162) (916,908) (497,647) (301,663)Increase/(decrease) in trade and other payables 886,581 229,030 (310,051) 88,754Increase/(decrease) in retirement benefit obligation (92,300) 24,243 (72,960) 36,469Increase in finance leased assets (448,893) (1,350,119) (448,893) (1,346,019)Increase/(decrease) in finance lease obligation (315,369) 804,926 (313,051) 802,608Increase/(decrease) in deferred revenue (29,037) (138,942) 80,630 (11,637) Cash generated from operations 928,064 1,141,009 640,460 1,187,235
Tax paid (286,938) (371,495) (197,899) (141,247)
769,514 1,045,988
Adjustment for non-cash and non-operating items
Movement in working capital
Net cash generated by operating activities 641,126 442,561
78A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
79A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
34.
The Group monitors and manages financial risks relating to its operations through internal risk reports which analyses exposures by degree and magnitude of risks. These risks include market risk (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk and cash flow interest rate risk.
The Group is not subject to any externally imposed capital requirements.
The Group undertakes transactions denominated in foreign currencies with Leventis Oversees Limited; consequently, exposures to exchange rate fluctuations arise. The Group is mainly exposed to fluctuations in UK Pounds, European Euros and US Dollars.
34.1
The gearing ratio at the year end is as follows
2011 1/1/2011 2011 1/1/2011 N '000 N '000
Debt 2,012,239 1,205,579 895,308 506,173 258,197 6,428
Equity 10,229,029 10,284,781 10,258,613 9,683,543 8,897,119 8,518,998
0.12 0.09 0.03 0.00
Debt is defined as long- and short-term borrowings, while equity includes all capital and reserves of the Group that are managed as capital by the Parent. The gearing ratio increased over the years indicating increase in the Company's debt profile relative to equity.
34.2
Details of the significant accounting policies and methods adopted (including the criteria for recognition, the basis of measurement and the basis for recognition of income and expenses) for each class of financial asset, financial liability and equity instrument are disclosed in relevant notes to the financial statements.
34.3
2011 1/1/2011 2011 1/1/2011 N'000 N'000
Cash and bank balances 1,847,013 987,638 1,227,275 1,567,834 819,366 354,092Loans and receivables 3,532,588 3,215,392 2,626,828 3,392,315 2,917,549 2,994,180Other financial assets 148,394 136,587 9,897 84,734 104,208 9,897
4,339,617 3,864,000 3,841,123 3,358,169
Amortised cost 7,838,246 6,439,996 6,055,268 2,666,970 2,498,940 2,128,710
6,439,996 6,055,268 6,439,996 6,055,268
Capital risk management
Gearing ratio
Net debt to equity ratio
Significant accounting policies
Categories of financial instruments
Financial Assets
Financial Liabilities
The Group The Company
N'000 N'000
The Group The Company
N'000 N'000
2012 2012
0.20 0.05
2012 2012
5,527,995 5,044,883
7,838,246 7,838,244
N'000 N'000
N'000 N'000
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
80A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
34.4
The Group monitors and manages financial risks relating to its operations through internal risk reports which analyses exposures by degree and magnitude of risks. These risks include market risk (including currency risk, fair value interest rate risk and price risk), credit risk, liquidity risk and cash flow interest rate risk.
34.5
The Group's activities expose it primarily to the financial risks of changes in foreign currency exchange rates (see Note 34.6) and interest rates (see Note 34.7 below).
34.6
The Group undertakes transactions denominated in foreign currencies with Leventis Oversees Limited; consequently, exposures to exchange rate fluctuations arise. The Group is mainly exposed to UK Pounds, European Euro and US Dollars.
The following table details the Group's sensitivity to a 5% increase and decrease in Naira against UK Pounds, European Euro, and US Dollars currencies. Management believes that a 5% movement in either direction is reasonably possible at the balance sheet date. The sensitivity analysis below includes outstanding Pound, Euro and Dollar denominated assets and liabilities. A positive number indicates an increase in profit where Naira strengthens by 5% against the Pound. For a 5% weakening of Naira against the Pound there would be an equal and opposite impact on profit, and the balances below would be negative.
Financial risk management objectives
Market risk
Foreign currency risk management
Naira strengthens by 5% against the UK Pounds
9,272 8,087
Naira weakens by 5% against the UK Pounds
Profit / (loss) (9,272) (8,087)
Naira strengthens by 5% against the European Euros
Profit / (loss) 1,530 (1,767)
Naira weakens by 5% against the European Euros
Profit / (loss) (1,530) 1,767
Naira strengthens by 5% against the US Dollars
Profit / (loss) 118,540 43,459
Naira weakens by 5% against the US Dollars
Profit / (loss) (118,540) (43,459)
The Group The Company 2011 2011
N'000 N'000
Profit / (loss)
2012 2012 N'000 N'000
13,439 16,152
(13,439) (16,152)
12,238 5,454
(12,238) (5,454)
121,572 17,478
(121,572) (17,478)
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
81A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
34.7
The Group is exposed to interest rate risk because entities in the Group borrow funds at both fixed and floating interest rates. The risk is managed by the Group by maintaining an appropriate mix between short and long term borrowings.
34.8
If NIBOR had been 1500 basis points higher/lower and all other variables were held constant, the Group and Company's profit or loss will be affected as follows:
34.9
Credit risk refers to the risk that counterparty will default on its contractual obligations resulting in financial loss to the Group. The Group has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral where appropriate, as a means of mitigating the risk of financial loss from defaults. The Group only transacts with entities that are rated the equivalent of investment grade and above. This information is supplied by independent rating agencies where available, and if not available, the Group uses other publicly available financial information and its own trading records to rate its major customers. The Group's exposure and the credit ratings of its counterparties are continuously monitored and the aggregate value of transactions concluded is spread amongst approved counterparties. Credit exposure is controlled by counterparty limits that are reviewed and approved by the executive committee annually.
Trade receivables consist of a large number of customers, spread across diverse industries and geographical areas. Ongoing credit evaluation is performed on the financial conditions of accounts receivable and, where appropriate, credit guarantee insurance cover is purchased.
The Group largest customer, Nigerian Bottling Company Limited owed 35% (2011: 31%) of the Company's total trade receivables. Concentration of credit risk to any other counterparty did not exceed 5% of gross monetary assets at any time during the year.
The credit risk on liquid funds is limited because the counterparties are banks with high credit ratings assigned by international credit - rating agencies.
34.10
Ultimate responsibility for liquidity risk management rests with the Board of Directors, which has established an appropriate liquidity risk management framework for the management of the Group's short-medium - and long-term funding and liquidity management requirements. The Group manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities. Details of additional undrawn facilities that the Group has at its disposal to further reduce liquidity risk are set out below.
Interest rate risk management
Interest rate sensitivity analysis
Credit risk management
Liquidity risk management
The Group The Company 2011 2011
N'000 N'000 2012 2012 N'000 N'00 0
Higher Borrowings (Naira) (18,084) (3,873)
Lower Borrowings (Naira) 18,084 3,873
(30,184) (7,593)
30,184 7,593
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
82A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
34.11
The following tables detail the Group's remaining contractual maturity for its non-derivative financial liabilities with agreed repayment periods. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Group can be required to pay. The table includes both interest and principal cash flows. To the extent that interest flows are floating rate, the undiscounted amount is derived from interest rate curves at the balance sheet date. The contractual maturity is based on the earliest date on which the Group may be required to pay.
Liquidity and interest risk tables
The Group The Company 3 months 3 months to 1 year 1 - 5 years to 1 year 1 -5 years
st31 December 2012Interest bearing:
Non-interest bearing:
st31 December 2011Interest bearing:
Total Total
N'000 N'000 N'000 N'000 N'000 N'000
Borrowings 2,012,239 - 2,012,239 506,17 3 - 506,173Finance lease liability 326,832 871,865 1,198,697 326,832 871,865 1,198,697
2,339,071 871,865 3,210,936 833,005 871,865 1,704,870
Trade and other payables 6,467,841 - 6,467,841 2 ,074,212 - 2,074,212
8,806,912 871,865 9,678,777 2 ,907,217 871,865 3,779,082
Borrowings 1,205,579 - 1,205,579 1,205,579 - 1 ,205,579Finance lease liability 299,601 1,214,465 1,514,066 299,601 1 ,214,465 1,514,066
1,505,180 1,214,465 2,719,645 1 ,505,180 1 ,214,465 8,158,935
Non-interest bearing:Trade and other payables 5,287,804 - 5,287,804 2 ,090,807 - 2,090,807
6,792,984 1,214,465 8,007,449 3,595,987 1,214,46 5 10,249,742
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
The book value of the trade and other receivables is arrived at by factoring allowance for doubtful debts on trade receivables and other receivables.
These were short-term facilities obtained from Fidelity Bank Plc and Finbank Plc for 36 months and 30 months at current interest rates of 12% and 12.5% respectively. It was repayable from cash flow generated from the operation of the Company and secured by negative pledge. The short term loan was fully repaid during 2012.
The carrying amount of bank overdrafts and loans is approximately equal to their fair value.
The Group The Company 2011 2011 2012 2012
The average number of persons employed during the year was as follows:
336 329 172 164Managerial 3,878 1,153 559 564Others
1,482 728 4,214 731
34.12
Except as detailed in the following table, the directors consider that the carrying amounts of financial assets and financial liabilities recorded at amortised cost in the financial statements approximate their fair values:
Fair value of financial instruments
83A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
N’000 N’000 N’000 N’000
The aggregate staff cost was Salaries and wages 2,044,376 1,802,375 1,099,566 987,485
1,802,375 987,4852,044,376 1,099,566
35. Staff
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
3 ,888,510 3,497,331 2,923,880 3,888,510 3,497,331 2,923,880Trade and other receivables 1 ,847,013 987,638 1,227,275 1,847,013 987,638 1,227,275 Cash and bank balances
- 111,513 356,523 - 111,513 356,523 Bank Loans 6 ,467,841 5,287,804 5,058,774 6,467,840 5,287,804 5,058,774Trade and Other payables
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Trade and other receivable s 2,520,583 3,070,601 3,093,988 2,520,583 3,070,601 3,093,988Cash and bank balances 1,567,834 819,366 354,092 1,567,834 819,366 354,092
Trade and Other Payables 2,065,297 2,090,807 2,002,053 2,065,297 2,090,807 2,002,053
The Group Book Value Fair Value
The Company Book Value Fair Value
2012 2012 N'000 N'000
2012 2012 N'000 N'000
Financial asset
Financial liabilities
Financial asset
Financial liabilities
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
84A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
35.1 Employees remunerated at higher rates:
36.
The Group The Company Number Number
2011 2011
Chairman's and Directors' emolumentsThe Group The Company
2011 2011 N'000 N'000
The Group The Company
x x 2011 2011
2012 2012
2012 2012 N'000 N'000
2012 2012
The number of employees in receipt of emoluments within the following ranges:
N N200,001 - 300,000 104 91 - -300,001 - 400,000 122 85 27 24400,001 - 500,000 126 284 111 111500,001 - 1,000,000 825 724 445 445Over 1,000,000 292 298 148 148
Emoluments Chairman 23,474 19,137 23,474 19,137 Other Directors 39,438 31,625 34,203 25,776
50,762 44,913
Chairman 23,474 19,137 23,474 19,137 Highest Paid Director 10,328 7,548 10,328 7,548
26,685 26,685
36.1 The number of Directors excluding the Chairman whose emoluments were within the following ranges:
N N
80,001 - 100,000 6 8 2 4600,001 - 700,000 8 6 3 31,180,001 and above 6 6 3 1
Directors with no emolument 20 8
Directors who sit on several boards within the Group are counted once.
37.
62,912 57,677
33,802 33,802
20 8
Number Number
Related party transactions
Balances and transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed in this note. Transactions between the Group and its associates are disclosed below.
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
85A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Sale of goods and service
Directors' transactions
There were no Directors' loans with debit balance as at 31 December 2012 (2011: Nil).
38. Remuneration of key management personnel
The following amounts were outstanding at the balance sheet date:
Trading transactions
During the year, group companies entered into the following transactions with related parties who are not members of the Group:
2011 1/1/2011 2011 1/1/2011 N'000 N'000 N'000 N'000
Nigerian Bottling Company Limite d . 3,634,063 3,408,108 2,403,059 - - -
Frigoglass Industries Nigeria Limit e d 84,542 68,969 77,334 - -
Leventis Overseas Limited - - - 7,235,079 7,867,963 7,867,963
3,477,077 2,480,393 7,867,963 7,867,963
Purchase of goods and services 2012 2012 N'000 N'000
3,718,605 7,235,079
Sale of goods and services Purchase of goods and services 2011 1/1/2011 2011 1/1/2011
N'000 N'000 N'000 N'000
Nigerian Bottling Company Limite d 759,990 664,043 526,998 - 7,397 -Frigoglass Industries Nigeria Limited 1,618 7,621 3,205 - - -Leventis Overseas Limited - - - 2,803,127 3,346,448 6,848Leventis Foundation 157 6,722 6,721 - - -
678,386 536,924 3,353,845 6,848
2012 2012 N'000 N'000
761,765 2,803,127
Nigerian Bottling Company Limited is a related party of the Group because they indirectly share common shareholders.
Frigoglass Industries Nigeria Limited is a related party of the Group because they indirectly share common shareholders.
Sales of goods to related parties were made at the Group's usual list prices, implying the same amount that goods would have been sold to unrelated third parties.
The amounts outstanding are unsecured and will be settled in cash. No guarantees have been given or received. No provisions have been made for doubtful debts in respect of the amounts owed by related parties.
The remuneration of the directors, who are the key management personnel of the Group, is set out below in aggregate for each of the categories specified in IAS 24 “Related Party Disclosures”.
2012 2011 N'000 N'000
Short-term employee benefits 62,912 50,762Post-employment benefits - -
50,76262,912
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
86A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
39.
As at 31 December 2012, there were estimated contingent liabilities based on solicitors' advice of 299.2 million (2011: N620.2 million). No provision has been made in these financial statements for contingent liabilities in respect of pending litigations as the directors are of the opinion, based on solicitor's advice, loss arising therefrom is not expected to be significant.
A notice for a penalty of N83 million was received in 2011 for the non-filing of returns which is being followed up with relevant authorities for details and reconciliation. Management is of the opinion that the probable liability that may crystalise will not be significant, therefore no provision has been made for these financial statements. In addition, the Federal Inland Revenue Authority (FIRS) is currently carrying out a tax audit for the Company. No provision has been made due to the uncertain outcome of the exercise.
40.
Leasing arrangements
The operating leases relate to the leasing of generators owned by Cummins West Africa Limited a member of the Group. The lease term is 3 months, with an option to extend for 1 year. All operating lease contracts contain market review clauses in the event that the lessee exercises its option to renew. The lessee does not have an option to purchase the property at the expiry of the lease period.
Rental income earned by the Group from this lease arrangement and direct operating expenses incurred on the building are 2012: N65.8 million (2012: N26 million) and 2011: N87.6 million (2011: N31.9 million) respectively. These amounts are included in rental income and administrative expenses in Notes 9 and 8 respectively.
There were no Non-cancellable operating lease receivables.
Contingent liabilities
The Group as lessor
N
38.1
378Chief Joseph Babatunde Oke, OON42Arthur Bourekas
605Prince Ademola Adetona398Haralambos George David
69Charalambos Katsaras -Anastasios Paul Leventis, OFR, CBE
110Anastasios I Leventis-Kenny E Odogwu
1,602
Dividend of Directors
2012 2011 N'000 N'000
Amounts due to Directors as at 31 December are as follows:
Names
Anastasios Paul Leventis, CBE, OFR 17,403 9,043 Anastasios I. Leventis 36,491 21,155
30,198
Dividends totalling N1,603,187 (net) were paid in the year in respect of ordinary shares held by the Company's Directors.
53,894
N'000
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
87A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
41.
Operating lease payments are recognised as an expense on a straight-line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the lease asset are consumed. Contingent rentals arising under operating leases are recognised as an expense in the period in which they are incurred.
Asset under finance lease with the carrying amount of N2.1 million (2011: N1.98 million) are pledged to secure the finance lease obligation (Note 20).
42.
As at 31 December 2012 the Group has commitments for amounts contracted but not provided of N1.4 million (2011: N24 million). There were no amounts authorised but not committed.
43.
On 28 February 2013, the Company entered into a sales and lease back with Access Bank Plc for a total amount of N417 million.
The directors are of the opinion that there are no further post balance sheet events which could have had material effect on the statement of financial position of the Company and the Group at 31 December 2012 and on the profit for the year ended on that date which have not been adequately provided for or disclosed.
44.
These are the Group's first consolidated and separate financial statements prepared in accordance with IFRS.The accounting policies set out in Note 2 have been applied in preparing the financial statements for the year ended 31 December 2012, the comparative information presented for the year ended 31 December 2011 and the opening IFRS statement of financial position as at 1 January 2011.
In accordance with the requirements of the Financial Reporting Council of Nigeria, the Company has carried out the transformation to IFRS with effect from 1 January 2011. Reconciliation between Nigerian GAAP and IFRS of the Company's statement of financial position as at 1 January 2011 and 31 December 2011 is provided hereunder.
Reconciliations of Group shareholders' equity and total comprehensive income have been provided hereunder.
The significant differences between Nigerian GAAP accounting policies and IFRS accounting policies are as follows:
The Group as lessee
Capital commitment
Events after the balance sheet date
Explanation of transition to IFRS
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
44 a
88A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Effects of first time adoption of IFRS - Company's Financial Position as at 1 January 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
IFRS adjusted
1 January 2011 R eclassification N'000 N'000
Notes Notes
Property, plant and equipment 44.2.1 5,698,446 (3,937,296) - 1,761,150Finance leased assets 44.2.2 884,001 (884,001) - -Investment properties 44.2.1 - 4,821,298 - 4,821,298Goodwill - - - -Interest in subsidiaries - - - -Investments in associates 1,283,958 - 44.3.1 (318,585) 965,373Deferred tax assets 44.2.10 - 71,402 44.3.2 27,287 98,689Other financial assets 9,897 - - 9,897
7,876,302 71,402 (291,298) 7,656,406 Current assets Inventories 1,692,079 - - 1,692,080Trade and other receivables 44.2.3 242,645 2,851,343 - 3,093,988Other debtors and prepayments 44.2.3 2,851,343 (2,851,343) - -Cash and cash equivalents 354,092 - - 354,092
5,140,159 - - 5,140,160
71,402 12,796,566
Share capital 1,323,645 - - 1,323,645Share premium 210,548 - - 210,548Retained earnings 2,397,032 - 44.3.3 268,877 2,665,909Other reserves 44.2.9 - 4,318,896 - 4,318,896Revaluation reserve 44.2.9 4,318,896 (4,318,896) - -
- 8,518,998
Deferred tax liability 44.2.10 497,872 71,402 - 569,274Retirement benefit obligation 360,882 - 44.3.4 90,955 451,837Finance lease liabilities 466,344 - - 466,344 1,325,098 71,402 90,955 1,487,455
Borrowings 44.2.4 - 6,428 - 6,428Bank overdrafts 44.2.4 6,428 (6,428) - -Term loans - - - -Trade and other payables 44.2.5 1,042,819 1,610,364 44.3.5 (651,130) 2,002,053Other creditors 44.2.5 2,171,285 (2,171,285) - -Deferred revenue 44.2.6 - 318,125 - 318,125Short term portion of finance lease 44.2.7 - 242,796 - 242,796Current tax liabilities 220,711 - - 220,711 Total current liabilities 3,441,243 - (651,130) 2,790,113
4,766,341 71,402 (560,175) 4,277,568
71,402 12,796,566
Reconciliation Statement
The Company
Non-current assets
Total non-current assets
Total current assets
Total assets
Equity and liability
Total equity
Non-current liabilities
Current liabilities
Total Liabilities
TOTAL EQUITY AND LIABILITY
IFRSNigerian SASAdjustments1 January 2011
N'000 N'000
13,016,462 (291,298)
8,250,121 268,877
13,016,462 (291,298)
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
89A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44 b Reconciliation Statement
The Group
Non-current assets
Current assets
Total assets
Equity and Liabilities
Total equity
Current liabilities
Current liabilities
Total liabilities
TOTAL EQUITY AND LIABILITIES
Effects of first time adoption of IFRS - Consolidated Financial Position as at 1 January 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
Prior year IFRS adjusted
adjustment Reclassification 1 January 2011 N'000 000 '000
Notes Notes Notes
Property, plant and equipment 9,717,547 - 9,717,547 44.2.1 (4,172,203) 44.5.2 31,273 5,576,617Finance leased assets 884,001 - 884,001 44.2.2 (884,001) - - Investment properties - - - 44.2.1 5,056,204 - 5,056,204Goodwill 7,212 - 7,212 - - 7,212Interest in subsidiaries - - - - - -Investments in associates - - - - - -Deferred tax assets 14,478 - 14,478 - 44.5.1 70,344 84,822Other financial assets 9,897 - 9,897 - - 9,897 Total non-current assets 10,633,135 - 10,633,135 - 101,617 10,734,752
Inventories 44 .4.1 4,786,064 (65,191) 4,720,873 - 44.5.2 (31,273) 4,689,600Trade and other receivables 712,402 - 712,402 44.2.3 2,211,478 - 2,923,880Other debtors and prepayments 2,211,478 - 2,211,478 44.2 . 3 (2,211,478) - -Cash and cash equivalents 1,227,275 - 1,227,275 - - 1,227,275 Total current assets 8,937,219 (65,191) 8,872,028 - (31,273) 8,840,755
(65,191) - 19,575,507
Share capital 1,323,645 - 1,323,645 - - 1,323,645Share premium 210,548 - 210,548 - - 210,548Retained earnings - - -Capital reserve 44 .4.2 3,287,547 (58,851) 3,228,696 44.2.8 220,263 44.5.3 (119,482) 3,329,477
44.2.8 220,263 - 220,263 (220,263) - -Other reserves - - - 44.2.9 4,318,896 - 4,318,896Revaluation reserve 4,318,896 - 4,318,896 (4,318,896) - -44.2.9 Attributable to equity holders of the parent 9,360,899 (58,851) 9,302,048 - (119,482) 9,182,566Non-controlling interests 44 .4.3 1,157,285 (36,470) 1,120,815 - 44.5.4 (44,653) 1,076,162
10,518,184 (95,321) 10,422,863 - (164,135) 10,258,728
Deferred tax liability 44 .4.4 548,478 30,130 578,608 - - 578,608Retirement benefit obligation 506,456 (1,295) 505,161 - 44.5.5 234,479 739,640Finance lease liabilities 466,344 - 466,344 - - 466,344 Total Non-Current liabilities 1,521,278 28,835 1,550,113 - 234,479 1,784,592
44.2.4 895,308 - 895,308Borrowings 538,785 - 538,785 44.2.4 (538,785) - -Bank overdrafts 356,523 - 356,523 44.2.4 (356,523) - -Term loans 3,153,915 1,295 3,155,210 44.2.5 1,903,564 - 5,058,774Trade and other payables 2,974,556 - 2,974,556 44.2.5 (2,974,556) - -Deferred revenue - - - 44.2.6 828,196 - 828,196Short term portion of finance lease - - - 44.2.7 242,796 - 242,796Current tax liabilities 507,113 - 507,113 - - 507,113 Total current liabilities 7,530,892 1,295 7,532,187 - - 7,532,187
9,052,170 30,130 9,082,300 - 234,479 9,316,779
(65,191) - 19,575,507
AdjustmentNigerian SAS Nigerian SAS IFRS
1 January 2011 1January 2011 Adjustment N'000 N'000
19,570,354 19,505,163 70,344
19,570,354 19,505,163 70,344
N'000 N' N
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
The Company
44 c
Effects of first time adoption of IFRS - Consolidated Financial Position as at 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below: I FRS adjusted
Reclassification 1 January 2011 N'000 N'000
Notes N otes
Property, plant and equipment 44.2.1 5,914,065 (2,955,595) - 2,958,470Finance leased assets 44.2.2 1,973,060 ( 1,973,060) - -Investment properties 44.2.1 - 4,928,655 44.3.6 (40,853) 4,887,802Goodwill - - - -Interest in subsidiaries - - - - Investments in associates 1,275,160 - 44.3.1 (318,585) 956,575Deferred tax assets - - 44.3.2 24,804 24,804Other financial assets 104,208 - - 104,208 Total non-current assets 9,266,493 - (334,634) 8,931,859
Inventories 1,721,981 - - 1,721,981Trade and other receivables 44.2.3 146,325 2,924,276 - 3,070,601Other debtors and prepayments 44.2.3 2,924,27 6 (2,924,276) - -Cash and cash equivalents 819,366 - - 819,366 Total current assets 5,611,948 - - 5,611,948
- 14,543,807
Share capital 1,323,645 - - 1,323,645Share premium 210,548 - - 210,548Retained earnings 2,906,465 - 44.3.3 152,117 3,058,582Other reserves 44.2.9 - 4,222,645 44.3.7 81,699 4,304,344Revaluation reserve 4,222,645 (4,222,645) - -
- 8,897,119
Deferred tax liability 704,276 - - 704,276Retirement benefit obligation 405,628 - 44.3.4 82,678 488,306Finance lease liabilities 1,214,465 - - 1,214,465
2,324,369 - 82,678 2,407,047
Borrowings 44.2.4 - 258,197 - 258,197Bank overdrafts 44.2.4 258,197 (258,197) - -Term loans - - -Trade and other payables 44.2.5 1,078,571 1,663,366 44.3.5 (651,130) 2,090,807Other creditors 2,267,13 5 (2,267,135) - -Deferred revenue - 306,488 - 306,488Short term portion of finance lease - 297,283 - 297,283Current tax liabilities 286,866 - - 286,866 Total current liabilities 3,890,769 - (651,130) 3,239,641
6,215,138 - (568,452) 5,646,688
- 14,543,807
Reconciliation statement
Non-current assets
Current assets
Total assets
Equity and Liabilities
Total equity
Non-current liabilities
Current liabilities
Total Liabilities
TOTAL EQUITY AND LIABILITIES
Nigerian SAS IFRS1 January 2011 Adjustments
N’000 N'000
14,878,441 (334,634)
8,663,303 233,816
14,878,441 (334,634)
A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t 90
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
91A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
Notes Notes Notes
44 d
Effects of first time adoption of IFRS - Consolidated Financial Position as at 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
Reconciliation Statement
The Group Prior year IFRS adjusted
adjustment Reclassification 1 January 2011 N'000 N'000 N'000
Non-current assets Property, plant and equipment 9,719,062 - 9,719,062 44.2.1 (3,186,743) 4 4.5.2 32,911 6,565,230Finance leased assets 1,976,818 - 1,976,818 44.2.2 (1,976,818) - -Investment properties - - - 44.2.1 5,163,561 4 4.5.1 (40,853) 5,122,708Goodwill 7,212 - 7,212 - - 7,212Interest in subsidiaries - - - - - -Deferred tax assets - - - - 90,815 90,815Investments in associates - - - 44.2.1 - -Other financial assets 136,587 - 136,587 - - 136,587 Total non-current assets 11,839,679 - 11,839,679 - 82,873 11,922,552 Current assets Inventories 44.4.1 4,778,664 (183,896) 4,594,768 - 4 4.5.2 (32,911) 4,561,857Trade and other receivables 688,944 - 688,944 44.2.3 2,808,387 - 3,497,331Other debtors and prepayments 2,808,387 - 2,808,387 44.2.3 (2,808,387) - -Cash and cash equivalents 987,638 - 987,638 - - 987,638 Total current assets 9,263,633 (183,896) 9,079,737 - ( 3 2,911) 9,046,826
(183,896) - 20,969,378
Share capital 1,323,645 - 1,323,645 - - 1,323,645Share premium 210,548 - 210,548 - - 210,548Retained earnings 44.4.2 3,697,235 (122,078) 3,575,157 44.2.8 127,944 4 4.5.3 (129,071) 3,574,030Capital reserve on consolidation 224,195 - 224,195 44.2.8 (224,195) - -Other reserves - - - 44.2.9 4,318,896 2,173 4,321,069Revaluation reserve 4,222,645 - 4,222,645 44.2.9 (4,222,645) - - Attributable to equity holders of the parent 44.4.3 9,678,268 (122,078) 9,556,190 - (126,898) 9,429,292
Non-controlling interests 968,973 (91,949) 877,024 - 4 4.5.4 (21,535) 855,439 -Total equity 10,647,241 (214,027) 10,433,214 - (148,433) 10,284,781
Deferred tax liability 44.4.4 678,382 30,130 708,512 - 44,709 753,221Retirement benefit obligation 611,492 (1,296) 610,196 - 4 4.5.5 153,687 763,883Finance lease liabilities 1,214,465 - 1,214,465 - - 1,214,465
Total non-current liabilities 2,504,339 28,834 2,533,173 - 198,396 2,731,569
Current liabilities Borrowings - - - 44.2.4 1,205,579 - 1,205,579Bank overdrafts 1,094,066 - 1,094,066 44.2.4 (1,094,066) - -Term loans 111,513 - 111,513 44.2.4 (111,513) - -Trade and other payables 3,337,463 1,296 3,338,759 44.2.5 1,949,045 - 5,287,804Other creditors 2,937,900 - 2,937,900 44.2.5 (2,937,900) - -Deferred revenue - - - 44.2.6 689,254 - 689,254Short term portion of finance lease - - - 44.2.7 299,601 - 299,601Current tax liabilities 470,790 - 470,790 - - 470,790 Total current liabilities 7,951,732 1,296 7,953,028 - - 7,953,028
10,456,071 30,130 10,486,201 - 198,396 10,684,597
(183,897) - 20,969,378
AdjustmentNigerian SAS Nigerian SAS IFRS
1 January 2011 1 January 2011 AdjustmentN'000 N'000 N'000
21,103,312 20,919,416 49,962
21,103,312 20,919,415 49,963
Total assets
Equity and Liabilities
Non-current liabilities
Total Liabilities
TOTAL EQUITY AND LIABILITY
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
44 e
Effects of first time adoption of IFRS - Company comprehensive income for the year ended 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
The Company IFRS adjusted Nigerian SAS
IFRS 31 December 31 DecemberAdjustment 2011 2011
N NN '000 '000'000 Notes
- 8,501,055Revenue 8,501,055 (40,853) (6,067,349)Cost of sales 44.1.1 (6,026,496)
(40,853) 2,433,706Gross profit 2,474,559 - 193,961Investment income 193,961 (96,251) 66,946Other gains and losses 44.1.2 163,197
- (526,108)Selling and distribution expenses (526,108) 26,630 (865,139)Administration expenses 44.1.3 (891,769)
(110,474) 1,303,3661,413,840 - -Share of profit from Joint venture -
- (172,929)Finance costs (172,929)
(110,474) 1,130,437Profit before tax 1,240,911 (6,284) (420,087)Income tax expense 44.1.4 (413,803)
Profit for the year from (116,758) 710,350continuing operations 827,108
Profit/Loss for the period from - -discontinued operations -
(116,758) 710,350Total profit for the year 827,108
(8,865) (8,865)Actuarial gain /(loss) 44.1.5 -
Available for sale financial (5,689) (5,689)assets 44.1.5.1 -
Other comprehensive income (14,554) (14,554)for the year net of tax -
(131,312) 695,796 827,108
Reconciliation Statement
Continuing operations
Discontinued operations
Other comprehensive income, net of tax
Total comprehensive income for the year
92A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
93A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44 f
Effects of first time adoption of IFRS - Group comprehensive income for the year ended 31 December 2011.
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
The Group
Prior year IFRS adjustment Adjustment
N'000 N'000 Continuing operations NotesRevenue 18,095,183 - 18,095,183 - 18,095,183Cost of sales 44.1.1 (14,066,036) (118,591) (14,184,627) (40,853) (14,225,480)
4,029,147 (118,591) 3,910,556 (40,853) 3,869,703Investment income 135,895 - 135,895 - 135,895Other gains and losses 44.1.2 262,510 - 262,510 (96,251) 166,259Selling and distribution expenses (1,436,757) - (1,436,757) - (1,436,757)Administration expenses 44.1.3 (1,685,984) - (1,685,984) 56,804 (1,629,180)
1,304,811 (118,591) 1,186,220 (80,300) 1,105,920Share of profit from Joint ventur e 32,379 - 32,379 - 32,379Finance costs (314,767) - (314,767) - (314,767)
Profit before tax 1,022,423 (118,591) 903,832 (80,300) 823,532Income tax expense 44.1.4 (479,555) - (479,555) (15,334) (494,889)
Profit for the year from continuing operations 542,868 (118,591) 424,277 (95,634) 328,643
- - - - -
Other comprehensive income, net of taxActuarial gain /(loss) 44.1.5 - - - 20,774 20,774Share of other comprehensive income 44.1.5.1 - - - (5,689) (5,689)
Total comprehensive income for the year (118,591) (80,549)
Profit attributable to:
Owners of the Company 727,363 (59,295) 668,068 (105,840) 562,228Non-controlling interests (184,495) (59,296) (243,791) 10,206 (233,585)
(118,591) (95,634)
Total comprehensive income attributable to:
Owners of the Company 542,868 (118,591) 424,277 (93,466) 564,396Non-controlling interests - - - 12,917 (220,668)
(118,591) (80,550)
Reconciliation Statement
Gross profit
Total profit for the year
Nigerian SAS Adjustment IFRS adjusted31 December Nigerian SAS 31 December
2011 31 December 2011 N'000 N'000 N'000
542,868 424,277 343,728
542,868 424,277 328,643
542,868 424,277 343,728
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
94A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44 g
Effects of first time adoption of IFRS - Company comprehensive income for the year ended 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
Reconciliation of profit Year end 31/12/2011 Profit for the year after tax
N'000
Previous GAAP Notes 1,240,911 827,108Adjustments 44 e (110,474) (116,758)
Total adjustment to profit or loss 710,350
Other comprehensive income 44 e (14,554) (14,554)
Total comprehensive income under IFRS 695,796
Reconciliation Statement
Profit before taxN'000
1,130,437
1,115,883
44 h
Effects of first time adoption of IFRS - Group comprehensive income for the year ended 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
Reconciliation of profit Year end 31/12/2011 Profit after tax
N'000
Previous GAAP Notes 1,022,423 542,868Adjustments 44 f (198,891) (95,635)
Total adjustment to profit or loss 328,643
Other comprehensive income 44 f 15,085 15,085
Total comprehensive income under IFRS 343,728
Reconciliation Statement
Profit before taxN'000
823,532
838,617
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
95A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44 i
44 l Reconciliation Statement
Effects of first time adoption of IFRS - Group Cash Flow for the year ended 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
IFRS
R aclassification N'000
Notes
Cash flows from operating activities
Net cash provided by operating activities 44.1.6 522,557 246,957 769,514
Net cash provided by investing activities 44.1.6 (590,725) (96,255) (686,980)
Net cash provided by financing activities (726,750) (150,702) (877,452)
Net increase in cash and cash equivalents (794,918) - (794,918)Cash and cash equivalents at beginning of the year 688,490 - 688,490
-
Nigerian SAS IFRS adjusted31 December 31 December
2011 2011 N'000 N'000
(106,428) (106,428)
Cash flows from operating activities
Cash and cash equivalents at end of the year
Effects of first time adoption of IFRS - Company Cash flow for the year ended 31 December 2011
The impact of adopting International Financial Reporting Standards is shown in the reconciliation below:
IFRS
R aclassification N'000
Notes
Net cash provided by operating activities 44.1.6 799,031 246,957 1,045,988
Net cash provided by investing activities 44.1.6 (245,627) (96,252) (341,879)
Net cash provided by financing activities (339,899) (150,705) (490,604)
Net increase in cash and cash equivalents 213,505 - 213,505Cash and cash equivalents at beginning of the year 347,664 - 347,664
-
Reconciliation Statement
Cash flows from operating activities
Cash and cash equivalents at end of the year
Nigerian SAS IFRS adjusted31 December 31 December
2011 2011 N'000 N'000
561,169 561,169
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
96A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44 m
The Company 31 December 2011
N'000
No t e s 1 0,647,241 8,663,303
Correction of Cummins West Africa Limited inventory due to error in the calculation of cost of sales affecting Non-controlling interest (91,949)Liability due to Victoria Beach Hotel now treated as dividend 140,395Liability due to Leventis Power Systems now treated as dividend 192,150Correction of Cummins West Africa Limited inventory due to error in the calculation of cost of sales affecting the Group (91,949)Correction of Victoria Beach Hotel error in deferred tax computation (30,124)Deffered tax implication of transition adjustment 44,709 23,135Transition adjustment in respect to retirement benefit obligation (171,612) (121,864)Impact on non-controlling interest on the adjusted gratuity scheme (21,535)Change in fair value of the quoted investments
8,897,119
Reconciliation of equity
Total equity under Nigerian GAAP previously reported
Total equity under IFRSs as restated
The Group31 December 2011
N'000
10,284,781
44 n
The Company 01/01/11
N'000
10,518,184 8,250,121
Liability due to Victoria Beach Hotel now treated as dividend 140,395Liability due to Leventis Power Systems now treated as dividend 192,150Correction of Cummins West Africa Limited inventory due to adjustment in the calculation of cost of sales affecting the Group ( 3 2,653)Correction of Victoria Beach Hotel adjustment in deferred tax comput a t i o n ( 3 0,130)Correction of Cummins West Africa Limited inventory due to adjustment in the calculation of cost of sales affecting non-controlling interest ( 3 2,538)Transition adjustment in respect to retirement benefit obligation (1 7 0,689) (90,955)Deffered tax implication of transition adjustment 51,207 27,287Impact on non-controlling interest on the RBO adjusted ( 4 4,653)
8,518,998
Reconciliation of equity
Total equity under Nigerian GAAP
Total equity under IFRSs
The Group 01/01/11
N'000
10,258,728
CO
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
97A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44.1
44.1.1 Upon transition to IFRS, the previous revalued amount was taken as deemed cost of investment property assets (see Note 44.2.1) and the cost model was selected for subsequent measurement of these investment properties. The resultant effect of this was an additional depreciation charge for investment properties of N40.9 million that booked against the cost of sales.
44.1.2 As mentioned in Note 44.1.1, the Company adopted the previous revalued amount as deemed cost at transition to IFRS. Under the previous NGAAP, the entity recognised a gain on disposal of investment by comparing the historical cost of this asset to its disposal proceeds. This adjustment relates to the adjustment to the profit on disposal initially recognised as a result of this event.
44.1.3 This adjustment relates to the effect of incorporating the actuarial valuation of the retirement benefit into the 2011 NGAAP balance.
44.1.4 The income tax adjustment resulted from the tax impact of the reversal of the initial provision made under NGAAP and the additional provisions recognised under IFRS.
44.1.5 This adjustment was as a result of the additional liability recognised which was taken to other comprehensive income (actuarial loss) net of the deferred tax effect.
44.1.5.1 This adjustment was as a result of the change in the fair value, net of the deferred tax, of the quoted investments.
44.1.6 Upon transition to IFRS, the Entity now recognises the finance cost on leased assets as part of finance cost instead of part of cost of sales as previously recognised under NGAAP. The adjustment accounted for the increase in Net cash provided by investing activities.
44.2
44.2.1
Under the provisions of the previous NGAAP, the Group presented its investment property as part of its fixed assets in the statement of financial position. IAS 40, however, provides that this asset category be presented separately. This is to give a better understanding to the users of the financial statement of the different nature existing between property held for investment purposes (for rental and capital appreciation) and property held for administrative purposes. IAS 1.54(b) specifically requires the separate presentation of investment property in the statement of financial position.
44.2.2
Assets under Finance Leases in substance are the lessee's assets. Under IFRS, there is no need to separately present such assets as the rights of ownership of this asset are deemed to be with the Company. Furthermore, IAS 17.31 provides for the disclosure of finance lease in the notes to the financial statements.
44.2.3
Under the previous GAAP, a total amount of N2.2 billion, (Group) and N2.9 billion (Company) for 2010 and N2.8 billion (Group) and N2.9 billion (Company) for 2011 were presented as a separate line item in the Statement of financial position as other debtor and prepayments. However, under IFRS, this balance has been reclassified as part of the trade and other receivables balances in the statement of financial position. A detailed disclosure is provided in the notes to this balance.
Included as part of this balance under the NGAAP is the balance due from related companies. For the purpose of clarity and availability of information, this line item is not included under IFRS. The balance is analysed by type (i.e. trade related, non-trade related, loans etc.) and disclosed in the notes to the financial statements.
Notes to reconciliation of equity
Notes to Reconciliation Statement IFRS reclassification-2010
Presentation of Investment Property
Reclassification of Finance Leased asset to PPE
Presentation of other debtors and prepayments
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
98A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44.2.4
Under Nigerian GAAP, the bank overdraft and term loans with balances of 539 million and 357 million (Group) and N6.4 million (Company) for 2011 and N1.1 billion and N111 million (Group) and N258.2 million (Company) for 2010 were shown as separate line items in the financial statements. Under IFRS this amount is presented as 'Borrowings' and the details provided in the “Borrowings" disclosure in the notes to the financial statements.
44.2.5
Under Nigerian GAAP, a balance of N2.97 billion (Group) and N2.2 billion, (Company) for 2010 and N2.2 billion (Group) and N2.3 billion (Company) for 2011 was presented as a separate line item on the face of the statement of financial position as 'Other Creditors', this balance has been reclassified as part of 'Trade and Other Payables' under IFRS with the components disclosed in the notes to the financial statements. This balance is also adjusted for the separate presentation of the short term portion of the finance lease and also the income received in advance which is explained in notes 44.2.7 and 44.26 respectively.
44.2.6
The deferred income which was originally reclassified as part of 'Other Creditors' under the NGAAP statement of finance position is reclassified and presented on the face of the statement of financial position as a separate line item 'Deferred Revenue'. This is in accordance with the provisions of IAS 1.55.
44.2.7
The short term portion of the finance lease obligation was reclassified from the other creditor balance and shown as a separate line item in the statement of financial position under IFRS.
44.2.8
The capital reserve on consolidation relates to the excess of the original amount of the net assets of the subsidiaries over the amount paid for the investment in subsidiaries. Under IFRS, this amount is taken immediately to profit or loss. Consequently, on transition, this amount has been reclassified from capital reserve to retained earnings.
44.2.9
IFRS 1 provides that upon transition to IFRS, an entity that has opted to adopt the cost model accounting policy for its property should reclassify the revaluation reserve arising from a previous NGAAP uplift or surplus in value. By implication, the existing revaluation surplus in the books of A.G. Leventis (Nigeria) Plc. was subsequently reclassified to other reserves upon transition to IFRS.
44.2.10
The deferred tax asset was reclassified from the net deferred tax liability presented in the previous NGAAP to a separate line item under non-current asset category.
44.3
IFRS Adjustment
44.3.1
An amount of N318.6 million due to Leventis Power Systems, a subsidiary owned 100% by the Company is treated under IFRS as a deemed distribution and a reduction in the cost of investment.
44.3.2
A deferred tax implication arises as a result of the differences between the amount initially recorded under the previous NGAAP and the amount recorded under IFRS.
Presentation of bank overdrafts and term loans
Reclassification of other creditors
Deferred revenue
Short term portion of finance lease obligation
Short term portion of finance lease obligation
Reclassification of revaluation reserve on investment property
Reclassification of deferred tax assets
Notes to Reconciliation Statement
Reclassification of amount due to subsidiaries
Reclassification of deferred tax assets/liabilities
N N
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For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
99A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44.3.3
(i) The amount due to Victorial Beach Hotel, a 100% owned subsidiary is now treated as a deemed distribution - N140.4 million
(ii) The amounts due to Leventis Power Systems, a 100% owned subsidiary is now treated as a deemed distribution - N192.2 million
(iii) The deferred tax on the gratuity valuation report is now adjusted for in retained earnings Company - N27 million
(iv) Gratuity expenses earlier posted are now reversed on the reflecting actuarial valuation. Company 2010: (N90 million)
The above lines (i-iv) affect year 2010 and 2011
(v) This is the total adjustment impact on 2011 income statement N117 million (see Note 44 e)
44.3.4
This amount relates to the additional liability recorded. A total of N360.9 million in 2010 and N405 million in 2011 were initially recorded under the NGAAP as the retirement obligation due. Based on the IAS19 valuation, this liability was estimated to be N451.8 million and N488.3 million as at December 2010 and 2011 respectively.
44.3.5
The following amount earlier stated as other payables (due to subsidiaries) in the previous NGAAP have now been reclassified as deemed distributions and a reduction of cost of investment.
(i) The amount due to Victoria Beach Hotel is reclassified as deemed contribution - N140.4 million
(ii) The amount due to Leventis Power Systems is reclassified to result in a reduced cost of investment - N192.2 million
(iii) The amount due to Leventis Power Systems is reclassified as a deemed contribution - N318.2 million
44.3.6
As a result of the deemed cost of investment properties on transition, a total of N40.9 million was charged to income as depreciation in 2011 in accordance with IAS40. Hence, the reduction in the value of investment properties.
44.3.7
IFRS adjustments were made in respect of the 2011 NGAAP balances. This resulted in an Other Reserves balance being reported. It includes N96.3 million transfer to retained earnings and (N14.6 million) net impact of actuarial valuation report posted to other comprehensive income.
44.4
Prior year adjustment - 2010
44.4.1
The Company reviewed the basis of accounting for the stock of spare parts. This review indicated that there should have been additional costs charged to profit in respect of the utilisation of these stocks that relates to periods prior to 31 December 2012. Accordingly an adjustment has been proposed as part of the opening statement of these financial statements (Year 2011 - N118.6 million, Year 2010 - N65.2 million).
The various IFRS adjustments affecting retained earnings are summarised below:
Additional retirement benefit obligation
Reclassification out of trade and other payables
Depreciation charged on investment properties
Adjustment to other reserve
Notes to Reconciliation Statement
Prior year adjustment in inventories
For The Year Ended 31 December 2012 (continued)
FINANCIAL STATEMENTSNOTES TO THE
44.4.3
The non-controlling interest in relation to the adjustment to inventory (explained in Note 44.4.1) is reflected.
44.4.4
The prior year adjustment on the deferred tax liability is required by the need to restate the previous years' deferred tax which was incorrectly stated in one of the subsidiaries.
44.5
IFRS Adjustment – Group
44.5.1
The deferred tax implication as a result of differences between the amounts initially recorded under the previous NGAAP and the amount recorded under IFRS.
44.5.2
Under IFRS, major spare parts and stand-by equipment qualify as property, plant and equipment (PPE) when an entity expects to use them during more than one period and they can only be used with a particular item of PPE. In line with the standard, Leventis Foods Limited (a subsidiary of A.G. Leventis (Nigeria) Plc) has capitalised N32.9 million of inventory in 2011 and 31.3 million in 2010 which qualifies as PPE. No depreciation has been charged on the assets as the Company's determines 'available for use' to be the point when the spares are placed into the related machines. IFRS requires depreciation to start only when the assets are available for use.
44.5.3
(i) This amount relates to the additional liability recorded under the retirement obligation due. Based on the IAS19 valuation, the net effect of the additional valuation was: 2010: N119.5 million
(ii) This is the total adjustment impact on the 2011 income statement of N129 million.
44.5.4
This amount relates to the additional liability recorded under the retirement obligation due. Based on the IAS19 valuation, the net effect of the additional valuation was: 2010: N44.7 million and N21.5 million in 2011.
44.5.5
This amount relates to the additional liability recorded. A total of N506.5 million in 2010 and N611.5 million in 2011 were initially recorded under the NGAAP as the retirement obligation due. Based on the IAS19 valuation, this liability was estimated to be N739.6 million and N763.9 million as at December 2010 and 2011 respectively.
Adjustment to non-controlling interests
Adjustment to deferred tax liability
Notes to Reconciliation Statement
Reclassification of deferred tax assets/liability
Reclassification of spare parts as property, plant and equipment
Various IFRS adjustment affecting retained earnings
Adjustment affecting non-controlling interest
Additional retirement benefit obligation
N
100A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
44.4.2 Adjustment to retained earnings
The adjustment to retained earnings based on the inventory adjustment, correction of deferred tax and adjustment to non-controlling interests recalculated as stated below:
N'000 N'000 2010
Group portion of inventory adjustment (91,948) (32,653)Deferred tax adjustment (30,130) (30,130)
(122,078) (62,783)Non-controlling interests 3,932 3,932
(58,851)
2011
(118,146)
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NOTE:
Earnings per share are based on the profit after taxation and the number of issued and fully paid ordinary shares at the end of each financial year.
Net assets per share are based on the net assets and the number of issued and fully paid ordinary shares at the end of each financial year.
This report is not prepared under IFRS. Instead, it has been prepared in compliance with the Company and Allied Matters Act (CAMA) requirement.
If the years 2010, 2009 and 2008 had been prepared under IFRS, the amounts presented would not significantly differ from the amounts under NGAAP presented above.
FIVE YEAR SUMMARYFor The Year Ended 31 December 2012
45. IFRS IFRS NGAAP NGAAP NGAAP 2012 2011 2010 2009 2008
N'000 N'000 N'000 N'000 N'000ASSETSFixed assets 9,234,988 9,711,120 9,717,548 10,001,620 8,434,235Investments 148,394 127,788 9,897 1,500 209,769Finance leased assets 2,059,601 1,976,818 884,000 188,467 2,062Goodwill on consolidation 7,212 7,212 7,212 87,045 -Promissory notes - - - 29,149 71,786Net current assets 874,020 1,102,597 1,406,328 1,352,870 1,884,142
12,324,215 12,925,535 12,024,985 11,660,651 10,601,994 Deferred taxation 551,737 662,406 534,000 839,198 737,690Finance lease obligation 871,865 1,214,465 466,344 - 592Staff gratuity 671,584 763,883 506,457 471,741 437,614Deferred Interest - - - 41,027 55,593
2,095,186 2,640,754 1,506,801 1,351,966 1,231,489
10,229,029 10,284,781 10,518,184 10,308,685 9,370,505 CAPITAL AND RESERVESShare capital 1,323,645 1,323,645 1,323,645 1,323,645 1,323,645Share premium 210,548 210,548 210,548 210,548 210,548Capital reserves 4,354,611 4,326,758 4,539,159 4,500,000 4,827,516Revenue reserve 3,937,498 3,568,341 3,287,547 2,937,502 1,908,764 Shareholders' funds 9,826,302 9,429,292 9,360,899 8,971,695 8,270,473Non-controlling interests 402,727 855,489 1,157,285 1,336,990 1,100,032
10,229,029 10,284,781 10,518,184 10,308,685 9,370,505 TURNOVER AND PROFITS Turnover 16,302,953 18,095,183 13,353,063 13,589,833 11,221,545 Profit before taxation and exceptional items 652,846 823,532 878,446 1,589,180 1,743,537Profit before taxation 652,846 823,532 787,562 1,763,235 1,743,537Profit after taxation 284,169 328,643 648,243 1,234,998 1,218,171Non-controlling interests 450,083 233,585 107,032 (177,808) (272,457)Profit after taxation and non-controlling interests 284,169 328,643 755,275 1,057,190 945,714 PER SHARE DATA - KOBO
Earnings - Basic 28 21 29 40 36Earnings - Diluted 28 21 29 40 36
Net assets 386 389 397 390 354
GROUP FINANCIAL SUMMARY31 DECEMBER
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NOTE:
Earnings per share are based on the profit after taxation and the number of issued and fully paid ordinary shares at the end of each financial year.
Net assets per share are based on the net assets and the number of issued and fully paid ordinary shares at the end of each financial year.
This report is not prepared under IFRS. Instead, it has been prepared in compliance with the Company and Allied Matters Act (CAMA) requirement.
If the years 2010, 2009 and 2008 had been prepared in compliance with IFRS equity would have been increased by N458 million in relation to amounts payable to related parties being reclassified as deemed distributions.
FIVE YEAR SUMMARYFor The Year Ended 31 December 2012
46. COMPANY FINANCIAL SUMMARY IFRS IFRS NGAAP NGAAP NGAAP31 DECEMBER 2012 2011 2010 2009 2008 N'000 N'000 N'000 N'000 N'000
Fixed assets 5,424,918 5,873,212 5,698,447 5,857,593 5,914,154Finance leased assets 2,056,865 1,973,060 884,001 - -Investments 1,053,567 1,060,783 1,293,855 1,475,885 1,300,164Promissory notes - - - 29,149 71,786Net current assets 3,144,444 2,372,306 1,698,916 1,392,145 895,993
11,679,794 11,279,361 9,575,219 8,754,772 8,182,097 Deferred taxation 709,040 679,472 497,872 564,826 480,535Finance lease obligation 871,865 1,214,465 466,344 - -Staff gratuity 415,346 488,306 360,882 350,484 340,236Deferred Interest - - - 41,027 55,593
1,996,251 2,382,243 1,325,098 956,337 876,364
9,683,543 8,897,119 8,250,121 7,798,435 7,305,733
Share capital 1,323,645 1,323,645 1,323,645 1,323,645 1,323,645Share premium 210,548 210,548 210,548 210,548 210,548Capital reserves 4,342,394 4,310,031 4,318,896 4,500,642 4,697,603Revenue reserve 3,806,956 3,052,895 2,397,032 1,763,600 1,073,937 Shareholders' funds 9,683,543 8,897,119 8,250,121 7,798,435 7,305,733
9,683,543 8,897,119 8,250,121 7,798,435 7,305,733
7,515,354 8,501,055 5,475,461 2,452,087 2,858,944 Profit before taxation and exceptional items 1,598,041 1,130,437 1,081,358 1,038,492 841,447Profit before taxation 1,598,041 1,130,437 990,474 1,212,547 841,447Profit after taxation 1,118,993 710,350 898,161 874,973 576,725Non-controlling interests - - - - -Profit after taxation and non-controlling interests 1,118,993 710,350 898,161 874,973 5 76,725 PER SHARE DATA - KOBOEarnings - Basic 42 27 34 33 22Earnings - Diluted 42 27 34 33 22
Net assets 366 336 312 295 276
ASSETS
CAPITAL AND RESERVES
TURNOVER AND PROFITSTurnover
CONSOLIDATED STATEMENTS
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A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t 74103
A . G . L e v e n t i s ( N i g e r i a ) P l c 2 0 1 2 A n n u a l R e p o r t
47. CONSOLIDATED STATEMENT OF VALUE ADDED
Additional information not required by IFRS
For The Year Ended 31 December 2012
2011 2011 % N'000 % % N'000 %
Turnover 16,302,953 18,095,183 7,515,354 8,501,055Other income 450,043 1 67,146 356,187 67,139Interest received 182,262 135,008 334,546 193,768Bought in materials:- Local (5,438,401) (5,864,080) (749,411) (2,964,222)- Imported (7,235,080) (8,165,385) (3,550,092) (2,649,850)
100 4,367,872 100 100 3,147,890 100
To pay employees:Salaries and wages 2,044,376 48 1,802,375 41 1,099,566 28 987,485 31Other related staff cost 491,800 12 502,696 12 252,196 6 256,510 8Gratuity 74,318 2 97,915 2 39,629 1 49,352 2
Interest expenses 436,429 10 314,767 7 258,445 7 172,929 5
Taxation 490,082 11 335,172 8 463,420 12 207,402 7
- Depreciation 1,012,090 24 1,060,172 24 658,707 17 551,177 19- Deferred taxation (121,404) (3) 159,717 4 15,628 0 212,685 7- Non-controlling interests (450,083) (11) (233,585) (5) - - - -- Profit and loss account 284,169 7 328,643 8 1,118,993 29 710,350 23
100 4,367,872 100 100 3,147,890 100
Value added represents the additional wealth which the Group has been able to create by its own and its employees' efforts. This statement shows the allocation of that wealth between employees, shareholders and government and that retained for the future creation of more wealth.
The Group The Company
Value added APPLIED AS FOLLOWS:
To pay providers of capital:
To pay Government:
To provide for replacementand expansion of assets:
2012 2012N'000 N'000
4,261,777 3,906,584
4,261,777 3,906,584
1 - 5,000 25,562 85.79 24,125,459 0.91
5,001 - 10,000 1,582 5.31 10,256,989 0.39
10,001 - 50,000 1,908 6.40 40,502,427 1.53
50,001 - 100,000 323 1.08 22,555,900 0.85
100,001 - 500,000 339 1.14 71,370,613 2.70
500,001 - 1,000,000 47 0.16 30,490,642 1.15
1,000,001 - 9999999999 36 0.12 2,447,988,275 92.47
Grand Total 29,797 100.00 2,647,290,305 100.00
Range No of Holders Percentage Units Percentage
INFORMATION ADDITIONAL
The analysis of ownership structure of 5% and above as at December 31, 2012
Leventis Holding S A 1,510,616,882 57.06Boval S A 640,537,970 24.20Leventis Overseas Ltd 177,198,452 6.69
Our records show that some dividend warrants in respect of past dividends declared have not been presented to the bank for payment.
A number of share certificates posted to shareholders have also been returned to us by the post office.
Shareholders who have not received their entitlements are advised to contact:City Securities (Registrars) Limited, 358, Herbert Macauley Way, Yaba. E-mail: [email protected]
Name of Shareholder No. of Shares Held Percentage of Share Capital
1. SHARE CAPITAL HISTORYThe issued and fully paid up share capital of the Company as at December 31, 2012 was N1, 323,645,525.00.
The share capital had been progressively increased over the years as follows
2. MAJOR SHAREHOLDERS
3. UNCLAIMED DIVIDENDS AND SHARE CERTIFICATES
4. ANALYSIS OF SHAREHOLDING AS AT 31 DECEMBER 2012
:
Share Capital Increase
Mar. 24, 1958 - 2,000,000 - -Mar. 28, 1958 - - - 400,000 CashMar. 15, 1963 2,000,000 4,000,000 400,000 3,500,000 Scrip (3 for 4)Mar. 29, 1963 - - 3,500,000 4,000,000 Scrip (1 for 7)Nov. 8, 1979 4,000,000 6,000,000 4,000,000 6,000,000 Scrip (1 for 2)Dec. 7, 1981 6,000,000 9,000,000 6,000,000 9,000,000 Scrip (1 for 2)Nov. 16, 1982 9,000,000 14,204,000 - - -June 15, 1983 14,204,000 14,854,000 9,000,000 14,835,937.50 Acquisition of Leventis Stores LtdNov. 2, 1989 14,854,000 25,000,000 14,835,937.50 22,253,906 Scrip (1 for 2)Oct. 31, 1990 25,000,000 40,000,000 22,253,906 27,817,382.50 Cash – (Rights 1 for 4)Dec. 27, 1993 40,000,000 75,000,000 - - Acquisition of Leventis Technical
PLC and Leventis Motors PLCDec. 28, 1993 - - 27,817,382.50 72,748,493April 14, 1994 75,000,000 150,000,000 - - -Feb. 22, 1995 - - 72,748,493 145,496,986 Cash (Rights 1 for 1)Sept. 14, 19 9 9 150,000,000 275,000,000 - - -Jan. 31, 2000 - - 145,496,986 175,665,466 Acquisition of Iddo Investments
Ltd & Victoria Beach Hotel PLCNov. 9, 2000 275,000,000 450,000,000 - - -May 17, 2001 - 175,665,466 439,163,665 Cash (Rights 3 for 2)Sept. 12, 2002 450,000,000 600,000,000 - - -Oct. 31, 2002 - - 439,163,665 474,126,527 Scrip DividendJune 24, 2003 600,000,000 1,200,000,000 - -Aug. 5, 2003 - - 474,126,527 514,339,929.50 Scrip DividendJan. 14, 2004 - - 514,339,929.50 988,466,456.50 Cash (Rights 1 for 1)Aug. 10, 2004 - - 988,466,456.50 1,027,266,172.50 Scrip DividendAug. 29, 2005 - - 1,027,266,172.50 1,103,037,627 Scrip DividendMay 28, 2008 1,200,000,000 1,350,000,000 1,103,037,627 1,323,645,525 Bonus Issue
Authorised Share
Capital Increased Consideration
Issued and Fully Paid Up
Date From To From To
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A G. Leventis (Nigeria) Plc (RC 1654)
ELECTRONIC DELIVERY MANDATE FORM
I, Chief/Mr/Mrs/Miss
of
HEREBY AGREE TO THE ELECTRONIC DELIVERY OF ANNUAL REPORT AND OTHER STATUTORY
DOCUMENTS OF A. G. LEVENTIS (NIGERIA) PLC BY CHOOSING ONE OF THE OPTIONS BELOW:
I WILL DOWNLOAD FROM THE COMPANY'S WEBSITE, www.agleventis.com
E-MAIL ADDRESS
Name (Surname First) Signature and Date
Please fill and return the completed form to either:
The Registrar OR The Company SecretaryCity Securities (Registrars) Limited A. G. Leventis (Nigeria) Plc358 Herbert Macaulay Way Iddo HouseYaba, IddoLagos. Lagos.
SHAREHOLDERS' DATA UPDATE
THE COMPANY SHOULD FORWARD THE MATERIALS TO THE FOLLOWING
For payment of dividends, dispatch of notices and Annual Reports & Accounts, update and execution of your mandates and instructions, please do any of the following:
· Visit www.csrl.firstcitygroup.com to download the Data Update Form· Scan completed copy and send to [email protected], · Send completed copy through letters, OR· Walk into City Securities (Registrars) Limited at 358 Herbert Macaulay Way, Yaba, Lagos.
CITY SECURITIES (REGISTRARS) LIMITED
E-Bonus and E-Dividend Mandate Form
/ /Please indicate which company you own Shares in
Date: (DD/MM/YYYY)
First Inland Bank Plc
Capital Oil Plc
Beta Glass Plc
A. G. Leventis (Nig) Plc
NFF Microfinance Bank Plc
FinInsurance Co. Ltd.
AG Homes Savings & Loans Ltd.
Hallmark Paper Products
Centage Savings & Loans Ltd.
Kogi Savings & Loans Ltd.
The RegistrarCity Securities (Registrars) Limited358, Herbert Macauley WayYaba, Lagos
Dear Sir,
I/We hereby mandate you to include my/our shareholding in A. G. Leventis (Nigeria) Plc
among the e-bonus beneficiaries for future bonus issues. My/Our shareholding
particulars are:
Surname:
Other Name(s):
Address:
Signature:
Telephone: Email:
CSCS Clearing House No:
Account number:
Stockbroking firm:
Note: please ensure that the names are identical with those on your share certificates.
I/We will also like to recieve my/our future dividends directly into my/our bank account electronically through
e-dividend. My/ Our bank account details are as stated below
Bank: Branch:
Branch Address:
Account Number:
Bank Sort Code: Official stamp and Authorised Signature:
Official stamp and Authorised Signature:
Yours faithfully,
Signature(s) of the Shareholder(s)
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NOTE:
A member (shareholder) who is unable to attend an Annual General Meeting is allowed by law to vote by proxy and this form
has been prepared to enable you exercise your right to vote in case you cannot personally attend the meeting.
Following the normal practice, the names of two Directors of the Company have been entered on the form to ensure that
someone will be at the meeting to act as your proxy. If you wish, you may insert in the blank space on the form (marked**) the
name of any person, whether a member (shareholder) of the Company or not who will attend the meeting and vote on your
behalf instead of one of the Directors.
For The Year Ended 31 December 2012 (continued)
FORMProxy
I/We…………………………………………………........…….
............………………………………………………………….
Being a member of AG LEVENTIS (NIGERIA) PLC
HEREBY appoint**……………………………………………
or failing him, CHIEF JOSEPH BABATUNDE OKE, OON or
failing him, MR ARTHUR BOUREKAS as my/our proxy to act
and vote for me/us and on my/our behalf at the Annual
General Meeting of the Company to be held on Tuesday,
July 2, 2013 and any adjournment thereof.
Dated this………….day of………………………………
Admission Card SHAREHOLDER'S FULL NAME To be completed by
Please admit shareholder or his duly appointed proxy to the
Annual General Meeting of A G Leventis (Nigeria) PLC which will be held at Mainland Hotel, Ebute-Metta, Lagos on Tuesday, July 2, 2013.
This admission card must be produced by the Shareholder or his proxy in order to be allowed to attend the Annual General Meeting.
Temidayo Olaofe (Mrs)Company Secretary/Legal Adviser
Number of Shares held
(To be completed by the Company's Official)
A G Leventis (Nigeria) PLC (RC 1654)
A G Leventis (Nigeria) PLC (RC 1654)Annual General Meeting holding at Mainland Hotel, Ebute-Metta, Lagos on Tuesday July 2, 2013 at 12.00 noon.
SHAREHOLDER'S FULL NAME
To be completed in advance by shareholder
Number of Shares held
(To be completed by the Company's Official)
Signature of Person Attending(To be signed in the presence of the Company's officials at the entrance to the Hall)................................................…………………………………………………........................
Resolutions For Against
To elect Mr Suleman Abubakar
as a Director
To elect Mr Orikolade Adebayo
Karim as a Director
To elect Mr Michail Oikonomakis
as a Director
To re-elect Chief Joseph Babatunde Oke, OON
as a Director
To declare a Dividend
To authorize the Directors to fix
the remuneration of the Auditors
To re-elect Otunba Adedotun Odunuga
as a member of the Audit Committee
To re-elect Mr Rasaq Mumuni as a member
of the Audit Committee
To re-elect Miss Christie Vincent
as a member of the Audit
Committee
Please indicate “X” in the appropriate square how you want your vote to be cast
on the resolutions set out above. Unless otherwise instructed, the proxy will vote
or abstain from voting at his discretion.
Second Fold
CITY SECURITIES (REGISTRARS) LIMITED358, HERBERT MACAULEY WAY, YABA,
LAGOS
First Fold
www.agleventis.com
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