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Seychelles Breweries Ltd

CONTENTSPage

Board of Directors

Administration (Board of Directors and Non-Board Executives)

Corporate Information

Notice of Meeting

Chairman’s Report

Rapor Tyermenn

Report of the Directors

Auditors’ Report

Profit and Loss Account

Balance Sheet

Cash Flow Statement

Financial Summary

Notes to the Financial Statements

Sales Volumes

Financial Highlights

Distribution of Wealth Created

Shareholding Summary / Shareholding Profile

Employee Distribution

Programme for Annual General Meeting

2

3

4

5

6

7

8 - 9

10

11

12

13

14

15 - 21

22

23

24

25

26

28

Annual Report 2013


BOARD OF DIRECTORS

2 Annual Report 2013

JEAN G. WEELING-LEE

DIRECTOR

Appointed as a Director in June 2008. He is the Managing Director of Corvina Investment Company Ltd. He also holds directorship of a number of companies in Seychelles.

PATRICIA BERTHELOT

GENERAL MANAGER

Appointed as a Director in May 2013. She was also appointed as the General Manager in July 2013.

CHRISTOPHE BEAU

DIRECTOR

Appointed as a Director in October 2013. He is also the General Manager of Diageo’s Partner Markets & Indian Ocean (PMIO).

EKWUNIFE OKOLI

CHAIRMAN

Appointed as a Director in October 2012 and Chairman in October 2013. He is also the Managing Director for the Diageo’s African Regional Markets (ARM).

WILLY CONFAIT

DIRECTOR

Appointed as a Director in February 2009. He is also the CEO of the Seychelles Pension Fund.

JERINA AH TIVE

COMPANY SECRETARY &

Joined the company in August 2012 and appointed as Company Secretary in August 2012.

FINANCE DIRECTOR

CAPTAIN ROBERT R. MORGAN

DIRECTOR

Appointed as a Director in April 2004. He is the Managing Director of Naval Services Ltd. He also holds directorship of a number of companies in Seychelles.


ADMINISTRATION (BOARD OF DIRECTORS AND NON-BOARD EXECUTIVES)

BOARD OF DIRECTORS

EKWUNIFE OKOLI

PATRICIA BERTHELOT

ROBERT R. MORGAN

JEAN G. WEELING-LEE

WILLY CONFAIT

COMPANY SECRETARY

NON-BOARD EXECUTIVES

JERINA AH TIVE

DEVON FRANCIS

JERINA AH TIVE

JAPHA ALLY

Chairman

General Manager

Director

Director

Director

Supply Chain Director

Finance Director

Human Resources Director

–

–

–

–

–

–

–

–

Annual Report 2013 3

CHRISTOPHE BEAU Director–


CORPORATE INFORMATION

BOARD OF DIRECTORS


Chairman

Directors

General Manager

Company Secretary

Solicitors

Auditors

Bankers

E. Okoli

P. Berthelot

C. Beau

W. Confait

R.R. Morgan

J.G. Weeling-Lee

N. Blazquez

A. Lucas

P. Berthelot

J. Ah Tive

Francis Chang-SamAttorney-at-Law

Pool & PatelChartered Accountants

Seychelles International MercantileBanking Corporation Limited (a.k.a. Nouvobanq)

The Mauritius Commercial Bank (Seychelles) Limited

Barclays Bank (Seychelles) Limited

Barclays Bank PLC

(Appointed 2013)

(Appointed 2013)

(Appointed 2013)

(Appointed 2009)

(Appointed 2004)

(Appointed 2008)

(Resigned 2013)

(Resigned 2013)

(Appointed 2013)

(Appointed 2012)


NOTICE OF MEETING

NOTICE is hereby given that the 45th Annual General Meeting of Seychelles Breweries Limited will be held at Ephelia Resort, Port Launay on Saturday 30th November, 2013 at 11a.m. for the following purposes:

1 To approve the Minutes of the previous Annual General Meeting.

2 To receive the Chairman's Report.

3 To receive and, if thought fit, adopt the Directors' and Auditors' Reports together with the FinancialStatements for the year ended 30th June 2013.

4 To declare a final dividend.

5 To consider and, if thought fit, to pass the following ordinary resolutions:

(a) That Captain Robert Morgan who retires by rotation at the Annual General Meeting be re-elected as a Director of the Company.

(b) That Patricia Berthelot and Christophe Beau, who were appointed on 5th April 2013 and 11th October 2013 respectively and who retire under section 163(4) of the Companies Act 1972, be re-elected as Directors of the Company.

(c) That non executive Directors’ remuneration of approximately R132,660 per annum be approved for the financial year 2013/14.

(d) That Directors’ remuneration of approximately R2,702,292.21 per annum be approved in respect of the General Manager for the financial year 2013/14

(e) That the Directors be authorised to fix the remuneration of the Auditors.

A member is entitled to appoint a proxy, who need not also be a member, to attend and vote in his or her stead. A Proxy Form is enclosed for the use of Shareholders.

By order of the Board.

Jerina Ah TiveCompany Secretary

14th October 2013



CHAIRMAN’S REPORT

Dear Shareholders,

It is with great pleasure that I welcome you all to our 2013 Annual General Meeting. I am delighted to have been appointed the Chairman of your Board of Directors following the resignation of our former Chairman Dr. Nick Blazquez. This is a great privilege, and I promise to give my best in discharge of this duty.

Firstly, I would like to thank Dr. Nick Blazquez for his many years of service to this company as Chairman of the Board. His dedication and vision has been a key driver of the achievements of the company.

Also since our last AGM, our Managing Director, Mr Aubrey Lucas has resigned from the board and has moved on to another role in supply within Diageo. Ms. Patricia Berthelot was appointed as his successor in July. Please join me in thanking Aubrey for his services and welcoming Patricia to SBL.

This Financial year 2012/2013 was a challenging year for our company and other private sector businesses. It witnessed some challenging macroeconomic trends such as, instability of the Rupees when we started the financial year, slow GDP growth, and inflation of 6.2%. In addition, the introduction of the Value Added Tax (VAT) has resulted in price increase to some of our products especially soft drinks. All of these measures have had an adverse impact on the business environment generally and specifically on the alcohol beverage market.

Being more specific on the beverage market, the new law regulating the timing for sale of alcoholic products is impacting on retail sales for our brands. Also we are preparing for the new National Alcohol Policy which is due soon. In addition, although we as a company welcome competition, we have witnessed a significant influx of imported beers, soft drinks and fruit juices into the country at low prices that have caused us concern, since we have fixed overheads and costs that we bear by manufacturing our beers and soft drinks locally that these imported products do not bear are worrying. This is a new type of competition which we are facing.

Internally, irregular availability of water and supply constraints have meant that at some times we were unable to supply in full the demand for some of our brands particularly beer.

Inspite of all these challenges, I am proud that our company was still able to deliver a decent set of results under very challenging circumstances. Net sales value (NSV) increased by 4% however, profit declined by 4%. The revenue growth was driven by price increases during the second half of the year and improvements in sales mix to higher value products. The profit declined in the year is due primarily to exchange loss experienced in the first quarter of the financial year after the appreciation of the Rupees.

Inspite of these challenges, I am proud to say that our brands remain very strong, and continue to hold leadership positions in all three categories (Beer, Spirits and Soft Drinks) that we participate in.

I am also happy to announce that we have now commenced a £3m capacity expansion investment which will include a state of the art Bottle Washer and Flash Pasteuriser. This will be the first flash pasteuriser in Diageo. This investment will not only significantly improve production capacity, but will also drive efficiency, particularly in water usage and waste reduction.

We have continued to focus on the development of our employees. I am happy to inform you that 10 of our supply employees have earned certificates and another 6 earned Diplomas from the Institute of Brewing and Distilling. Also one of our employees is on track to earn a Master Brewer qualification in the near future.

Our company has increased its focus on controls and compliance within the company and to this end we have recently employed a Controls, Compliance and Ethics (CC&E) Manager who will be driving a robust CC&E agenda across the business. We are also reviewing and upgrading our information and control systems.

Finally, I wish to thank all our shareholders for the support you have given to the Board. As the new Chairman, I trust that I can count on your continued support, and you have my assurance that we will tackle with vigour the current challenges facing our business.

Thank you.

Ekwunife Okoli Chairman

14th October 2013




RAPOR TYERMENN

Ser Aksyonner,

I fer mwan gran plezir pour swet zot labyenveni dan Miting zeneral anyel pour 2013. Mon osi tre kontan ki mon'n ganny apwente Tyermenn Bord Direkter, swivan Dr Nick Blazquez ki'n donn son demisyon. Sa i en gran privilez pour mwan, e mon promet zot ki mon pou fer touzour mon mye dan sa travay.

Premyerman, les mwan remersye Dr Nick Blazquez pour sa kantite lannen servis ki i'n donnen koman Tyermen Bord. Son vizyon e dedikasyon dan sa pozisyon ti enn bann lafors prensipal ki'n fer avanse nou lakonpannyen.

Osi depi nou dernye AGM, nou Managing Director Mr Aubrey Lucas in donn son demisyon lo Bord, e in al pran en nouvo pozisyon dan Diageo, dan domenn aprovizyonman. Ms Patricia Berthelot ti ganny apwente dan son plas an Zilyet. Mon demann zot pour zwenn avek mwan pour dir en gran mersi Aubrey pour tou son servis e devouman, e pour nou swet labyenveni Patricia dan Seychelles Breweries.

Sa lannen finansyel 2012/2013 in en lannen plen avek defi pour nou e pour lezot biznes dan sekter prive. Nou'n experyans serten tandans makro-ekonomik tel ki enstabilite dan valer roupi o komansman nou lannen finansyer, en ralenti dan krwasans GDP, e lenflasyon 6.2%. An plis ki sa lentrodiksyon VAT (tax lo valer azoute) in koz logmantasyon dan pri serten nou bann prodwi, sirtou limonnad. Tou sa bann mezir in annan en lefe negatif lo lanvironman biznes an zeneral, e pli spesifikman lo lavant labwason alkolize.

An partikilye sa nouvo lalwa ki regle ler lavant bann prodwi alkolik in annan en lenpak serye lo lavant an detay nou bann prodwi. Nou osi pe prepar nou pour sa nouvo Polisi Nasyonal lo Lalkol ki pou sorti byento. Malgre ki koman en lakonpannyen nou apresye konpetisyon, nou'n vwar logmantasyon enportan dan lakantite labyer, limonnad e dyous enporte a bann pri bokou pli ba, e nou konsernen akoz nou, nou bezwen pran an kont bann kou fix par le fe ki nou prodwi lokalman, tandi ki bann prodwi enporte napa sa. Vwala bann nouvo kalite konpetisyon ki nou pe fer fas avek.

Lo kote lakonpannyen, problem delo pandan peryod lasesres in met serten kontrent lo nou prodiksyon, ki'n fer ki nou pa'n touzour kapab fourni tou demann, sirtou kot i konsern labyer.

Malgre tou sa bann defi, nou fyer pour note ki nou lakonpannyen in kanmenm kapab prodwi bann bon rezilta, sirtou an term lavant ki'n monte par 4%, me profi in desann par 4%. Logmantasyon dan reveni i an rezilta bann ogmantasyon dan pri pandan dezyenm parti sa lannen e amelyorasyon dan lavant e valer nou prodwi. Diminyasyon dan profi li in koze par pert an rezilta apresyasyon Roupi pandan premye kar lannen.

Nou osi fyer pour dir ki kanmenm sa, nou mark prodwi i reste dan en pozisyon for, e i kontinye tenir son premye pozisyon dan kategori labyer, spirit e limonnad.

Mon osi annan plezir pour anons en lenvestisman £3 milyon ki nou'n deza komanse, pour ogmant nou kapasite, enkli nouvo lekipman pli modern ki annan, pour lav boutey e pour pasteralizasyon. Sa lekipman pasteralizasyon ki aple en “flash pasteuriser” i premye ki Diageo i annan dan sa kalite. Sa lenvestisman i pou non selman amelyor nou kapasite prodiksyon, me osi i pou rann nou sistenm pli efikas, sirtou kot i konsern konservasyon delo e rediksyon salte.

An menm tan non'n kontinye met lanfaz lo developman nou bann anplwaye. I fer mwan gran plezir pour enform zot ki 10 nou staf dan domenn prodiksyon in ganny kalifikasyon lo nivo sertifika e 6 lo nivo diploma avek 'Institute of Brewing and Distilling' ki baze Langleter. En lot nou bann staf i lo semen pour li ganny son sertifika 'Master Brewer' byento.

Nou lakonpannyen pe osi konsantre for lo kontrol e konformite avek bann standar etabli, e pour ranforsi sa laspe nou travay nou'n apwent en manedyer responsab pour kontrol, konformite avek standar e etik – (Controls, Compliance and Ethics) – resaman. Sa manedyer pour asire ki sa trwa domenn i reste toultan azour dan nou biznes. Nou pe osi reviz e amelyor nou sistenm lenformasyon e kontrol.

Finalman mon ti a kontan remersye zot tou bann aksyonner pour sipor ki zot donn Bord. Koman en nouvo Tyermenn mon annan konfyans ki nou a kapab kontinyen kont lo zot sipor, e lo mon kote mon donn zot lasirans ki nou pou kontinye antrepran avek kouraz tou sa bann defi ki nou biznes pe fer fas avek.

Mersi bokou.

Ekwunife Okoli Tyermenn

14 Oktob 2013



REPORT OF THE DIRECTORS

The Directors present their report together with the Auditor's Report and the Audited Financial Statements for the year ended 30th June 2013.

1. The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the Companies Act, 1972. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

2. The Directors, having prepared the financial statements, have requested the Auditors to take whatever steps and undertake whatever inspections they consider to be appropriate for the purpose of enabling them to give their audit report.

3. The Directors consider that they have met their responsibilities as set out in the Companies Act, 1972.

The principal activities of the Company during the period continued to be the production of beer and soft drinks.

Statement of Directors' Responsibilities

Principal Activities of the Company

Dividends

Fixed Assets

Reserves

In June 2013, the Company paid an interim dividend of R2.50 per share and a special dividend of R2.75 per share. The Directors recommend the payment of a final dividend of R2.18 per share making a total of R7.43 per share for the year.

The Directors are of the opinion that the market or saleable value of the fixed assets at 30th June 2013 does not differ substantially from the amounts at which they are included in the accounts at that date.

The loss for the period of R when added to the profit retained at 30th June 2012 of R152,866,306 makes a total net retained profit of R124,775,861 at 30th June 2013.

At 30th June 2013, the capital reserves amounted to R15,804,703.

28,090,445

Results for the Year

Profit (Loss) before Taxation Taxation Profit (Loss) after Taxation

Dividends Profit (Loss) for the year

100,044,922

(34,517,367)

65,527,555

(93,618,000)

(28,090,445)

Year to30th June

2013R

104,341,538

(16,885,367)

87,456,171

(95,760,000)

(8,303,829)

Year to30th June

2012R



REPORT OF THE DIRECTORS CONTINUED

Directors

The Directors of the Company during the year and their interests in accordance with the register maintained under Section 111 of the Companies Act, 1972 were as follows:

Ordinary shares held at 30th June 2013 were:

Auditors

The Auditors Pool & Patel, Chartered Accountants, will continue in office in accordance with the provisions of and subject to the provisions to section 155(2) of the Companies Act, 1972.

N. Blazquez (British) NilA. Lucas (Seychellois) 7,750C. Beau (French) NilP. Berthelot (Cameroonian) NilW. Confait (Seychellois) NilR. R. Morgan (Seychellois) 5,321E. Okoli (Nigerian) NilJ. G. Weeling-Lee (Seychellois) Nil

N. Blazquez had interests in the ordinary shares of the company held by:

Guinness Overseas Limited 3,276,000Diageo Netherlands BV 3,074,756Aardvark Nominees Limited 504,000

14th October 2013

The company had a contract for the production of Guinness Stout with Guinness Overseas Limited of which N. Blazquez was a Director.

Otherwise no Directors had any material interest, directly or indirectly, in any contract with the company, nor did any Director hold any share option during the period under review.

E. Okoli P. Berthelot

R.R. Morgan W. Confait J. G. Weeling-Lee

DIRECTORS

C. Beau


INDEPENDENT AUDITOR'S REPORT

SEYCHELLES BREWERIES LIMITED

We have audited the accompanying financial statements of Seychelles Breweries Limited on pages 11 to 21 which comprise the balance sheet as at June 30 2013, the profit and loss accountincluding cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information. The financial statements have been prepared by management, under the historical cost convention and the financial reporting provisions of the Seychelles Companies Act 1972.

This report is made solely for the Company's members as a body in accordance with Section 158 of the Companies Act 1972. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company's Members as a body for our audit work, for this report or for the opinion we have formed.

Management's Responsibility for the Financial StatementsManagement is responsible for keeping proper accounting records and for the preparation of financial statements that give a true and fair view of the company's affairs in accordance with the financial reporting provisions of the Seychelles Companies Act 1972, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

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

We have no relationship with,or material interest in the company other than in our capacity as auditors and arms length dealings with the company in the ordinary course of business.

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

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

OpinionIn our opinion, the accompanying financial statements set out on pages 11to 21give a true and fair view of the financial position of Seychelles Breweries Limitedas at June 30 2013, and of its financial performance and its cash flows for the year then ended in accordance with the financial reporting provisions of the Seychelles Companies Act 1972.

POOL & PATELCHARTERED ACCOUNTANTS

14th October 2013

MOORE STEPHENSINTERNATIONAL LIMITED

An independent member firm of Moore Stephens International Limited - members in principal cities throughout the world

Maison La Rosiere; P.O.Box 117; Victoria; Mahé; Seychelles

Tel: +248 323210

Email: [email protected]

Fax: +248 232518

Website: www.moorestephens.com

Bernard L. Pool FCA • Suketu Patel FCA • Gémma Roberts FCCA

Chartered AccountantsPool & Patel



FOR THE YEAR ENDED 30TH JUNE 2013PROFIT AND LOSS ACCOUNT

Notes

TURNOVER 2

Trading Profit for the Year 3

Exchange Gains / (Losses)

22 Interest Received / (Paid)

PROFIT/(LOSS) BEFORE TAXATION

5 Taxation

PROFIT/(LOSS) AFTER TAXATION

Dividends 6

PROFIT/(LOSS) FOR THE YEAR

Prior Years' Retained Profits

RETAINED PROFITS AT END OF PERIOD

499,152,703

114,418,663

(14,534,088)

160,347

100,044,922

(34,517,367)

65,527,555

(93,618,000)

(28,090,445)

152,866,306

124,775,861

Year to30th June

2013R

Year to30th June

2012R

23

527,143,290

96,197,666

8,187,431

(43,559)

104,341,538

(16,885,367)

87,456,171

(95,760,000)

(8,303,829)

161,170,135

152,866,306

BALANCE SHEET AT 30TH JUNE 2013

Notes

SHARE CAPITAL 8

CAPITAL RESERVES 9

PROVISION FOR RETIREMENT LIABILITY 13

DEFERRED TAX LIABILITY

RETAINED PROFITS

SHAREHOLDERS INTERESTS

FIXED ASSETS 11

DEFERRED TAX ASSET 19

INVESTMENT 20

CURRENT ASSETS

Stocks 12

Debtors

Cash in Hand and at Banks 14

CURRENT LIABILITIES

Due to Diageo Group Companies 17

Owing to other Creditors

Liability for Deposits

Provisions for Dividends 6

NET CURRENT ASSETS

Year to30th June

2013R

63,000,000

15,804,703

26,739,254

57,938,406

123,567,827

105,843,547

5,897,625

Year to30th June

2012R

14th October 2013



Tax paid in advance 10

63,000,000

15,804,703

27,791,996

14,676,154

152,866,306

274,139,159

19,243,657

40,751,852

34,316,804

167,760,541

252,423,676

8,958,483

42,897,072

7,446,096

46,620,000

105,921,651

146,502,025

274,139,159

108,393,477

13,346,032

5,897,625

9,594,479

16,783,186

124,775,861

16,598,513

247,103,004

22,496,138

39,156,980

35,183,887

255,847,100

13,112,424

89,269,407

7,233,950

27,468,000

137,083,781

118,763,319

247,103,004

19

E. Okoli P. Berthelot

R.R. Morgan W. Confait J. G. Weeling-Lee

DIRECTORS

C. Beau



DRINK RESPONSIBLY. 18

FOR THE YEAR ENDED 30TH JUNE 2013CASH FLOW STATEMENT

NET CASH INFLOW FROM OPERATING ACTIVITIES

Trading Profit Depreciation Charges

Payments of Compensation

Movement in Stocks Movement in Debtors

Movement in Creditors Movement in Deposits Movement in Employees’ Retirement Scheme

Fixed Assets scrapped

NET CASH INFLOW FROM OPERATING ACTIVITIES

RETURNS ON INVESTMENTS AND SERVICING OF FINANCE

Movement in Balances with Diageo Group Companies

Year to30th June

2013R'000

114,419 15,186

(4,246)

(17,186)

46,372

(212) 3,193

76

142,382

160

(10,380)

Year to30th June

2012R'000

TAXATION (Business and Provisional Taxes)

INVESTING ACTIVITIES Payments to acquire tangible fixed assets

INCREASE / (DECREASE) IN CASH AND CASH EQUIVALENTS

CASH AND CASH EQUIVALENTS AT 1ST JULY

CASH AND CASH EQUIVALENTS AT 30TH JUNE

(29,673)

(100,213)

(53,414)

(12,713)

(14,541)

167,761

123,568

Interest Paid

(100,170) Dividends Paid

96,198 10,109

(3,247)

(74) 6,398

18,569

964 3,480

143,175

(43)

10,778

(29,673)

(100,213)

(53,414)

(19,221)

(19,221)

197,434

167,761

(100,170)

(4,840)

–

Interest Received

–

–

(112,770)

(112,610)

(61,252)

(12,713)

44,193



FINANCIAL SUMMARY

TURNOVER

Profit Before Taxation

Taxation

Profit After Taxation

Exceptional Item and transfer to capital reserves

Dividends

RETAINED PROFIT / (LOSS)

Share Capital

Capital Reserves

Deferred Liability

Retained Profit

Shareholders’ Interests

CAPITAL EMPLOYED

Annual Investment in Fixed Assets – R’000

Dividend per Share (R)

Earnings per Share (R)

Net Assets Value per Share (R)

The Net Asset Value per share is calculated by reference to the Shareholders’ Interest.

408,977

(18,997)

(26,920)

(45,917)

52,587

(26,460)

(19,790)

63,000

15,805

28,125

71,380

178,310

178,310

1,767

2.10

(3.64)

14.15

Year to30/062010

R’000(Restated)

Year to30/062009

R’000(Restated)

465,869

133,031

(40,699)

92,332

0

(63,630)

28,702

63,000

15,805

45,369

161,171

285,345

285,345

15,241

5.05

7.33

22.65

Year to30/062011

R’000(Restated)

422,295

160,688

(59,279)

101,409

0

(40,320)

61,089

63,000

15,805

49,439

132,469

260,713

260,713

8,050

3.20

8.05

20.69

527,143

104,341

(16,885)

87,456

0

(95,760)

(8,304)

63,000

15,805

42,468

152,866

274,139

274,139

19,221

7.60

6.94

21.76

Year to30/062012

R’000(Restated)

499,153

100,045

(34,517)

65,528

0

(93,618)

(28,090)

63,000

15,805

43,523

124,776

247,104

247,104

12,713

7.43

5.20

19.61

Year to30/062013

R’000



FOR THE YEAR ENDED 30TH JUNE 2013NOTES TO THE FINANCIAL STATEMENTS

1

The principal accounting policies adopted by the company are as follows:

(a)

The financial statements have been prepared under the historical cost convention, other than accounting for the fixed assets which are at professional valuations at open market value for existing use at 30th April 1990, and in accordance with applicable accounting standards.

(b)

Except for company houses, all fixed assets acquired up to 30th April 1990 are stated at professional valuations at replacement cost and depreciated so as to include them net in the accounts at their open market value for existing use at that date. Company houses are stated at open market value professionally ascertained at 30th April 1990.

Additions from 1st May 1990 are stated at cost.

Depreciation is provided to write off the valuations or the cost of fixed assets over the terms of their anticipated useful lives set out below.

At valuations:Brewery Buildings - 40 yearsOffice Buildings - 50 yearsPlant, Equipment andMotor Vehicles - Over their professionally evaluated

remaining useful lives restricted to amaximum period of 10 years fromacquisition.

At cost:Brewery Buildings - 40 yearsPlant - 10-15 yearsEquipment - 5 yearsMotor Vehicles - up to 6 years

No depreciation is provided on land and Company houses.

(c)

(i) The company charges its customers refundable deposits of R2 on glass bottle and R20 on each crate. The liabilities for returnable deposits are disclosed under Current Liabilities in the Balance Sheet.

(ii) Glass bottles and crates are brought into the accounts at cost.

(iii) Depreciation of bottles and crates is provided to write their cost over their anticipated useful lives as set out below:

Bottles - 5 yearsCrates - 10 years

ACCOUNTING POLICIES

Basis of Accounting

Fixed Assets and Depreciation

Bottles and Crates



2

Turnover represents the value of the sales of the Company's products.

3

The trading profit for the year has been stated after charging:

TURNOVER

TRADING PROFIT FOR THE YEAR

Year to30th June

2013R

Year to30th June

2012R

NOTES CONTINUED

(d)

Trading stocks are valued at cost or, if lower, net realisable value. Costs of raw materials include all expenses incurred in bringing the stocks to store. In the instances of finished and semi-finished products, costs consist of the direct cost of materials attributable to that stage of production.

(e)

Foreign currencies transaction are converted into rupees at the rates of exchange ruling at dates oftransactions. Balances of overseas currencies at the Balance Sheet date are converted at the rates ruling at that date. Realised gains and losses from trading are brought into account in arriving at the trading profit, while the unrealised gains and losses are shown separately.

(f)

The accounts are prepared so as to disclose current taxation payable, and business tax paid in advance.

Deferred business tax is provided for using the balance sheet liability method of accounting for differences between tax bases of assets and their carrying amounts for financial reporting purposes. Full provision is made for all timing differences, which have arisen but not reversed at the balance sheet date.

(g)

The company has an employee scheme that provides benefits for employees who leave the Company after 3 or more years of service, or who retire at the age of 63 or later having completed that period of service. The current financial statements include the liability accrued to employees in full under this scheme.

(h)

The employment (Amendment) Act 1999 requires employees to be compensated upon retirement or resignation for continuous service from their date of original employment. The current financial statements include the liability accrued to employees in full under this Act.

Stocks

Foreign Currencies

Taxation

Employees' Retirement Scheme

Effect of Employment (Amendment) Act 1999

Auditor’s RemunerationDepreciation of fixed assets

345,00015,185,625

310,89910,108,761



NOTES CONTINUED

5 TAXATION (Profit and Loss Account)

Provision for business tax based on the profit for the period

Deferred Tax

Interim Dividends of on 12,600,000 R2.50shares in issue (2012 - R1.90)

6 DIVIDENDS

4 DIRECTORS’ EMOLUMENTS

Year to30th June 2013Salaries/Fees

R

34,800,000

(1,145,449)

34,517,367

31,500,000

Year to30th June

2013R

Except for payment of the above fees, none of the Directors received or waived any emoluments during the year.

Year to30th June 2012Salaries/Fees

R

Year to30th June

2012R

23,940,000

Proposed Final Dividend of on 12,600,000 R2.18shares in Issue (2012 - R3.70)

£ Stg € Euro US $ South African Rand Singapore $

7 FOREIGN CURRENCIES

27,468,000

93,618,000

18.240015.457611.76771.30479.5000

46,620,000

95,760,000

Balances in foreign currencies at 30th June 2013 have been translated into Seychelles Rupees at the following rates:

Special Dividends of on 12,600,000 shares in issue

R2.75(2012 - R2.00) 34,650,000

Adjustment to agree prior year -

34,800,000

33,000,000

(4,770,695)

16,885,367

(11,343,938)

21,656,062

25,200,000

22.740018.224914.42991.7488

11.5308

Corporate Social Responsibility Tax 862,816 -

N. BlazquezA.M. LucasP. BerthelotW. ConfaitR.R. MorganE. OkoliJ.G. Weeling-Lee

2,474,960

44,22044,220

44,220

2,412,275

40,20040,200

40,200

-

-

-

-

Year to30th June

2013R

Year to30th June

2012R

Year to30th June

2013R

Year to30th June

2012R

- -



NOTES CONTINUED

SHARE CAPITAL

Authorised, Issued and Fully Paid: 12,600,000 Shares of R5 each

CAPITAL RESERVES

Value of bottles and crates brought into the accounts on:

- the introduction of bottle deposits

- increase in value of bottle deposit to R2 per bottle

Surplus on the revaluation of fixed assets

Value at 30th June

Paid for prior year Provision for business tax current year

Paid on account

Balance at 30th June

FIXED ASSETS

At Valuation or Cost:

At 30th June 2012 1,600,000

Additions –

At 30th June 2013 1,600,000

Depreciation:

At 30th June 2012 –

Charge for the year –

Disposals

At 30th June 2013 –

Net Book Value:-

At 30th June 2013 1,600,000

At 30th June 2012 1,600,000

Year to30th June

2013R

63,000,000

5,650,166

7,421,223

13,071,389

2,733,314

15,804,703

34,800,000

(52,414,774)

(35,183,887)

8

9

10

11

OtherFreehold

PropertiesR

Plant&

EquipmentR

BreweryFreeholdLand &

BuildingsR

Bottles&

CratesR

Year to30th June

2012R

63,000,000

5,650,166

7,421,223

13,071,389

2,733,314

15,804,703

Balance at 1st July (9,594,479)

(7,974,634)

–

81,215,310

554,224

81,769,534

37,793,473

1,872,507

39,665,980

42,103,554

43,421,837

–

216,543,872

7,926,444

224,007,426

168,818,328

8,445,088

176,877,991

47,129,435

47,725,544

(385,425)

41,704,935

4,232,492

45,937,427

26,058,839

4,868,030

30,926,869

15,010,558

15,646,096

–

CURRENT TAXATION (Balance Sheet)

33,000,000

(34,527,443)

(9,594,479)

22,163,559

(30,230,595)

TotalR

341,064,117

12,713,160

353,314,387

232,670,640

15,185,625

247,470,840

105,843,547

108,393,477

(385,425)

Disposals – (462,890)(462,890) – –

Bottles and crates which were previously disclosed separately have now been added to fixed assets on the Balance Sheet.

Year to30th June

2013R

Year to30th June

2012R

Year to30th June

2013R

Year to30th June

2012R



NOTES CONTINUED

12

Raw, packaging and cleaning materials Finished and semi-finished products Engineering spares Engineering spares write-off provision Goods in transit

13

Seychelles Breweries Retirement Scheme Employment (Amendment) Act 1999

18,409,267

11,447,983

24,035,216

(6,098,392)

10,144,332

57,938,406

18,319,603

8,419,651

26,739,254

PROVISION FOR RETIREMENT LIABILITY

STOCKS

17,202,176

6,214,318

20,477,115

(6,098,392)

2,956,635

40,751,852

18,590,275

9,210,721

27,791,996

Year to

30th June2013

R

Year to30th June

2012R

The Cash at Banks represent cash held at banks. The cash comprises of:

Cash in Hand

Cash at Banks

122,644

123,445,183

123,567,827

14 CASH IN HAND AND AT BANKS

COMMITMENTS FOR CAPITAL EXPENDITURE FOR WHICH NO PROVISION HAS BEEN MADE IN THE ACCOUNTS

There were no capital commitments, either contracted or approved by the Directors but not contracted, as at 30th June 2013. . (2012: nil)

15

Year to30th June

2013R

Year to30th June

2012R

52,816

167,707,725

167,760,541

16 CONTINGENT LIABILITIES

The directors are not aware of any contingent liabilities as at 30th June 2013.

Year to30th June

2013R

Year to30th June

2012R



NOTES CONTINUED

Amounts due to Diageo Group companies in foreign exchange comprising trading debt for the supply of raw materials, plant and machinery, royalties and fees for technical services amounted to R13,112,424

.

Royalties to Guinness Ireland and technical services fees for the year were R4,856,726 and R2,126,666 respectively .

(2012: R8,958,483)

(2012: R5,577,928 and R2,290,345 respectively)

17 DUE TO DIAGEO GROUP COMPANIES

18

The Company has overdraft facilities which are secured by mortgages of £110,000 and R1,500,000 and over the Company's freehold property.

MORTGAGES AND CHARGES

19

The accounting policy for deferred taxation is based on balance sheet full liability method. Current charges on deferred tax are accounted for as part of the current year tax charge.

DEFERRED TAX

Deferred tax liability 16,783,186

Deferred tax asset:

Employees Retirement Scheme and Compensation 8,823,954

Other 7,774,559

16,598,513

Year to30th June

2013R

20

Investment is stated at cost in the following unquoted company incorporated in Seychelles:

INVESTMENT

Seybrew Employees Retirement Scheme Limited

5,897,625

Long term loan

5,897,625

Year to30th June

2013R

The loan does not bear interest and has no specific terms of repayment.

The results of this subsidiary have not been taken into account in these financial statements as the directors consider that in view of the insignificant amounts involved, it would be of no real value to the members of the company.

14,676,154

9,171,359

4,174,673

13,346,032

Year to30th June

2012R

5,897,625

5,897,625

Year to30th June

2012R



NOTES CONTINUED

22

The Seychelles Breweries Limited ultimate holding company is Diageo plc.

ULTIMATE HOLDING COMPANY

21

The Directors changed the accounting policy in relation to bottles and crates in the year.

Previously bottles and crates were valued at standard value and depreciated over their anticipated useful lives. The change in accounting policy provides that bottles and crates are valued at cost and subsequently depreciated as before.

As a result of the change in accounting policy, prior year figures have been restated as follows:

CHANGE IN ACCOUNTING POLICY

Retained earnings

Bottles and crates

143,999,555

6,779,345

152,866,306

15,646,096

As previouslystated

R

Restated

R



SALES VOLUMES

BEER & SOFT DRINK VOLUMES

SEYBREW: 26%

EKU: 11%

GUINNESS: 6%

SMIRNOFF ICE: 2%SEYPEARL RANGE: 18%

COCA-COLARANGE: 37%

BEER VOLUME in Thousand Hectolitres

0

5

10

15

20

25

30

35

40

08/09 09/10 10/11 11/12 12/13

('0

00

Hls

)

SEYBREW EKU GUINNESS SMIRNOFF ICE

0

10

20

30

40

50

60

70

08/09 09/10 10/11 11/12 12/13

SEYPEARL RANGE COCA-COLA RANGE

SOFT DRINK VOLUME in Thousand Hectolitres

('0

00

Hls

)



FINANCIAL HIGHLIGHTS

NET ASSETS VALUE - Rupees per Share

(Ru

pe

es

)

14.5

22.7

0

5

10

15

20

25

08/09 09/10 10/11 11/12

20.721.8

-14.3

124.2

-20

0

20

40

60

80

100

120

140

160

180

08/09 09/10 10/11 11/12

PROFIT BEFORE TAX - R’m

(Ru

pe

es

’m

)

160.7

104.3

12/13

100.0

210.0

505.0

0

100

200

300

400

500

600

08/09 09/10 10/11 11/12

320.0

DIVIDENDS - Cents per Share

(Ce

nts

)

700760.0

800

12/13

743.0

12/13

19.6



DISTRIBUTION OF WEALTH CREATED

The distribution of wealth created statement shows how wealth created by the Company goes back directly and indirectly into the Seychelles economy. The calculation also takes into account the portion retained for the replacement and expansion of the assets employed by the Company.

Year toJune 2013

R’000

Turnover

Less:

Paid to suppliers for materials and services

Total Wealth Created

Distributed as follows:

Members of staff

Salaries, wages, bonuses, pensions and other benefits 15%

Providers of Capital

Dividends 31%

Government Taxes

Trades Tax

Company Tax

Import Duties

57%

Reinvestment in the Company

Depreciation

Retained Profit/(Loss)

-3%

Total Distributed and Retained

499,153

(201,784)

297,369

45,207

93,618

127,907

34,517

171,448

15,186

(28,090)

(12,904)

297,369

100%

TOTAL DISTRIBUTED AND RETAINED WEALTH

Year toJune 2012

R’000

13%

29%

58%

0%

527,143

(191,605)

335,538

43,198

95,760

167,826

16,885

10,064

194,775

10,109

(8,304)

1,805

335,538

100%

Members ofStaff: 15%

Providers ofCapital: 31%

GovernmentTaxes: 57%

9,024

Reinvestment inthe company: -3%



SHAREHOLDING PROFILE The share ownership and the categories of shareholders at 30th June 2013 are set out below.

SHAREHOLDING SUMMARY

FOREIGN SHAREHOLDERS

% Holding

GUINNESS OVERSEAS LTD 3,276,000 26.00%

DIAGEO HOLDINGS NETHERLANDS BV 3,074,756 24.40%

AARDVARK NOMINEES LTD 504,000 4.00%

Total Foreign Shareholders 6,854,756 54.40%

LOCAL SHAREHOLDERS

SEYCHELLES PENSION FUND 3,314,606 26.31%

OTHER LOCAL SHAREHOLDERS (Corporate Bodies & Individuals) 2,430,638 19.29%

Total Local Shareholders 5,745,244 45.60%

GRAND TOTAL12,600,000 100.00%

Numberof shares

969 161 157

323025 1 3

178,358 131,557 361,671 245,089 658,289 153,787 701,887 504,000 9,665,362

1.42%1.04%2.87%1.95%5.22%1.22%5.57%4.00%

76.71%

1,360

1 - 500 shares 501 - 1,000 shares

1,001 - 5,000 shares 5,001 - 10,000 shares

10,001 - 50,000 shares 50,001 - 100,000 shares

100,001 - 250,000 shares 250,001 - 1,000,000 shares

Over 1,000,000 shares

12,600,000 100.00%

Number ofShareholders

Size of Shareholding Number ofShares Owned

% of TotalIssued Shares

14.49%

54.40%

0.10%26.31%

4.70%

100.00%

1,825,932

6,854,756

13,001 3,314,606 591,705

12,600,000

Individuals

Diageo Group

Haase Group Seychelles Pension Scheme Other Corporate Bodies

1,337

3

3 1

16

1,360

Number ofShareholders

Category of Shareholders Number ofShares Owned

% of TotalIssued Shares



EMPLOYEE DISTRIBUTION

Age Group

Nu

mb

er

of

Em

plo

ye

es

pe

r G

rou

p

AGE DISTRIBUTION THROUGHOUT THE COMPANY

30

25

20

15

10

5

0

<20 21-25 26-30 31-35 36-40 41-45 46-50 51-55 56-60 60+

4

17

33

23

14

32

16

86

0

35

Years of Service

Nu

mb

er

of

Em

plo

ye

e P

er

Gro

up

LENGTH OF SERVICE

60

50

40

30

20

10

0

0-5 06-10 11-15 16-20 21-25 26-30 31-35 36-40 40+

79

21

13

21

10

1 1 0

7

70

80

90

TOTAL STAFF BY DEPARTMENT

MD’s Office: 3%

Human Resources,Facilities & Services: 5%

Supply Chain: 76%

Finance & IS: 8%

Commercial: 8% (13)

(13)

(7)

(4)

(116)


PROGRAMME FOR ANNUAL GENERAL MEETING

Only Shareholders or their proxies are entitled to attend the Annual General Meeting on Saturday 30th November 2013.

Transport departs various locations on Mahe from 9.00 a.m.

Arrival at Ephelia Resort, Port Launay 10.45 a.m.

Assemble for Annual General Meeting 10.55 a.m.

Annual General Meeting to Commence 11.00 a.m.

Refreshments (non-alcoholic) and lunch 12.00 noon

Transport departs Ephelia Resort, Port Launay 1.30 p.m.

Buses will depart from and return to the following locations:

Bel Ombre - Danzilles via St. Louis, SPTC Platform A, Montagne Posee to Ephelia Resort, Port Launay. Beau Vallon - Beau Vallon Police Station via Glacis, Anse Etoile, SPTC Platform A, La Misere to Ephelia Resort, Port Launay.

Anse Aux Pins - Anse Aux Pins Bus Terminal via Takamaka, Baie Lazare to Ephelia Resort, Port Launay.

Anse Royale - Bus Stop next to Anse Royale Police Station via Les Cannelles, Anse Boileau to Ephelia Resort, Port Launay.

Buses “properly identified” with SEYBREW banners will stop at all Bus Stop along the way to Ephelia Reosrt, Port Launay.

For Shareholders from Praslin and La Digue, “Cat Cocos” will leave Praslin at 9.00 a.m. A bus will be stationed at the Inter Island Quay on arrival. Similar arrangements will be made for departure.

Seychelles Breweries LtdO’Brien House, PO Box 273, Le Rocher, Mahé, Seychelles

Tel (+248) 4 382 600 • Fax (+248) 4 382 [email protected]


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