summary consolidated annual financial statements

SUMMARY CONSOLIDATED ANNUAL FINANCIAL STATEMENTS

T W E N T Y E I G H T E E N

W W W . D I S T E L L . C O . Z A

TOP 15 DISTELL BRANDS

Distell Abridged booklet_V6_20180914_12549_SA_14h00.indd 1-2 2018/09/14 16:37

SALIENT FEATURES

1 Normalised earnings before interest, tax, depreciation and amortisation (EBITDA) refers to EBITDA adjusted for the: a) prior year impairments of Angola land and investment in a wine broker in the UK;

b) current year gain on the unbundling of Lusan and sale of Bisquit; c) one-off losses and write-off in Tanzania Distilleries Limited, an associate company, following a sachet ban and excise duty dispute; d) impairment of property, plant and equipment (PPE) and intangible assets; and e) Group restructuring and retrenchment costs.

2 Foreign currencies and abnormal transactions affect the Group’s performance. Where relevant in this report, adjusted non-IFRS measures are presented. These adjusted measures represent pro forma financial information. A reconciliation of the pro forma financial information to the equivalent IFRS metrics is provided on page 18.

+10,4%GROUP REVENUE

+7,4%1,2

NORMALISED EBITDA adjusted for forex

+4,2%TOTAL DIVIDEND

+4,6%VOLUMES

+21,6%CASH GENERATION

in harm reduction and sustainable community development

R24,0 millionINVESTED

per litre of production year on year

12,2%ELECTRICITY USAGE

status maintained

Level 4B-BBEE


14,3%WATER USAGE

3,3%GREENHOUSE GAS EMISSIONS

year on year

395,0 cents per share

GREYMATTER & FINCH # 12549


COMMENTARY / 2

KOMMENTAAR / 6

INDEPENDENT AUDITOR’S REPORT / 11

DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTING / 10

SUMMARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION / 12

SUMMARY CONSOLIDATED INCOME STATEMENT / 13

SUMMARY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME / 15

SUMMARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY / 16

SUMMARY CONSOLIDATED STATEMENT OF CASH FLOWS / 17

NOTES TO THE SUMMARY CONSOLIDATED ANNUAL FINANCIAL STATEMENTS / 18

NOTICE TO SHAREHOLDERS OF AN ANNUAL GENERAL MEETING / 28

CONTENTS

PROXY FORM / Inserted

These summary consolidated annual financial statements, prepared in terms of IFRS, are extracted from our full integrated report.

To align with the increasing trend towards online reporting and electronic access to information, we do not distribute printed copies of our integrated report, but rather make it available online on the Group’s website at www.distell.co.za/investor-centre.

Printed copies of the integrated report are available on request. If you wish to receive a hard copy, please email [email protected].

All products mentioned in these summary consolidated annual financial statements are not for sale to persons under the age of 18 years. Enjoy our products responsibly.

DATES OF IMPORTANCE TO SHAREHOLDERS / 35

ADMINISTRATION / 36

Distell Abridged booklet_V6_20180914_12549_SA_14h00.indd 1 2018/09/14 16:33

22 www.distell.co.za

COMMENTARY

OPERATING PERFORMANCE OF CONTINUING OPERATIONSGroup revenue grew by 10,4% to R24,2 billion on 4,6% higher volumes. Revenue excluding excise duty grew by 7,7%.

Domestic market revenue increased by a commendable 10,1% and sales volumes rose by 4,4% while the economy continued to show low GDP growth amidst increased costs of living placing pressure on consumer disposable incomes. The Group’s ready-to-drink (RTD) portfolio delivered strong revenue and volume growth, led by Savanna and Bernini in the face of increased competition and managed to grow market share in the period. The spirits category showed continued growth with brandy volumes still resilient and whisky recovering in the second half. Exceptional gin volume growth continues at 29,3% alongside growth of 43,6% from vodka following the acquisition of the premium Cruz vodka brand during the previous financial year. The wine portfolio showed revenue growth of 7,4% due to premium wine still benefiting from trading-up by consumers from mainstream brands, which also recovered in the second half of the financial year.

African markets, outside South Africa, delivered revenue growth of 19,5% on sales volumes which were up by 7,0%, largely driven by the inclusion of KWA Holdings E.A. Limited (KHEAL) in Kenya which was acquired in April 2017. Focus markets on the continent, such as Botswana, Kenya, Zambia and Zimbabwe, all recorded strong growth. Solid RTD growth came from Hunter’s and Kingfisher. In Kenya, growth in the wine category was attributed to double-digit revenues led by J.C. Le Roux and Nederburg, with spirits led by Kibao, Viceroy and Hunter’s Choice. Overall performance was negatively impacted by challenging trading conditions in Mozambique, Nigeria and the one-off negative impact from the Group’s Tanzania Distilleries Limited (TDL) associate as indicated below. Currency devaluations and the slow extraction of cash significantly impacted second-half performance in our Angolan operations. The Africa region contributed 55,1% to foreign revenue.

Volumes in international markets beyond Africa grew by 1,8% driven by Europe, Latin America and Asia-Pacific regions, as well as Travel Retail. Revenue increased by 5,8% as the increased local investment in the UK was impacted by the effects of a less favourable sales mix. Travel retail continues to perform well alongside volume growth in our spirits portfolio, led by Amarula and sales of single malts. Scottish Leader managed to grow market share in Taiwan in a declining market. Our ciders and RTDs delivered strong volume growth as a result of increased investment in the category resulting in Bernini delivering a stellar performance with volume growth in excess of 50%. Wine volumes remained constant, with UK listings increasing to position growth for the future.

Operating costs, which include the costs of newly acquired KHEAL and investment into the Group’s shared service centre, rose by 11,6%. Excluding excise duties, which increased by 16,4%, other operating costs increased by 9,7%, of which sales and marketing costs rose by 10,0%. We continue with a structured process to consolidate and improve the efficiencies of our supply chain and supporting functions throughout the Group. Foreign currency translation losses amounted to R51,4 million (2017: R63,3 million).

The Group acquired the remaining 50% shareholding in the joint venture, Lusan Holdings Proprietary Limited (Lusan), and a gain of R37,8 million on the Group’s previously held equity interest is reflected as part of “other gains and losses” in the income statement.

Included in “other gains and losses” in the income statement are impairments of R78,7 million for intangible assets and PPE, mainly relating to our Asian operations.

Net finance costs in the previous year include the reversal of a R41,9 million provision for interest payable after reaching a settlement with the South African Revenue Service following an extended excise duty dispute. Net finance costs, excluding the reversal, increased from R256,5 million to R295,6 million.


3DISTELL Summary consolidated annual financial statements 2018

COMMENTARY

Distell’s share of equity-accounted earnings decreased by 47,2%. The R29,8 million contribution of the newly acquired 26% investment in Best Global Brands Limited (BGB) was more than offset by one-off losses and impairments of R85,9 million following a sachet ban and excise duty dispute which impacted the performance of TDL, in which Distell has a 35% interest.

EBITDA grew by 20,2%. Normalised EBITDA, which excludes the impact of the impairments, the profit on sale of investments, the one-off losses in TDL, retrenchment and Group restructuring costs, increased by 6,0%. Normalised EBITDA, excluding foreign currency translation movements, increased by 7,4%.

The effective tax rate was 29,7% (2017: 28,4%) as the impairment charges and capital costs are not tax deductible.

Headline earnings, including discontinued operations, decreased by 5,6% to R1,5 billion and headline earnings per share decreased by 5,7% to 668,2 cents. Excluding the currency conversion movements, the reversal of the interest and the TDL losses referred to above, headline earnings increased by 5,2%. Basic earnings per share increased by 26,9% to 750,3 cents.

INVESTMENT AND FUNDINGTotal assets increased by 8,0% to R22,1 billion.

Investment in net working capital declined by 6,2% to R6,6 billion, benefiting from the Bisquit Dubouché et Cie (Bisquit) disposal referred to on the facing page. Inventory decreased by 2,7% to R7,6 billion. Of this, bulk spirits in maturation, planned in accordance with the Group’s longer-term view of consumer demand for its brands in this category, increased 11,0% to R2,9 billion. This is mainly attributable to the increased investment in our Scottish whisky inventory. Investment in bottled stock and packaging material increased by 9,6%, in line with revenue growth. Trade and other receivables increased by 14,4% following stronger revenue growth over the last two months of the financial year compared to the corresponding period in the previous year.

Capital expenditure for the period amounted to R1,17 billion (2017: R805,6 million). Of this, R464,7 million was spent on the replacement of assets. A further R710,0 million was directed to the expansion of capacity, mainly in relation to the Group’s manufacturing facilities for cider and spirits.

In July 2017, the Group acquired 26% of the ordinary shares of BGB for USD54,6 million. The Group has also entered into an agreement to acquire the remaining 74% of the ordinary shares, which will become effective no earlier than the end of 2019 once certain operating hurdles are achieved and conditions precedent to closing are fulfilled or waived.

Net cash generated from operating activities increased by 21,6% to R2,3 billion. The Group remains in a strong financial position, which is demonstrated by a debt-to-debt-plus-equity ratio of 22,5% (2017: 25,2%) and a debt-to-equity ratio of 29,0% (2017: 33,8%) at the end of the reporting period.

DISCONTINUED OPERATIONSOn 31 January 2018 the Group sold its equity interest in Bisquit for a final cash consideration of EUR50,7 million. The financial results of Bisquit have been excluded from the continuing operations of the Group and are disclosed separately in the summary financial statements as “discontinued operations”. The Group realised a gain of R173,5 million on the disposal of Bisquit, which is also reflected as part of “discontinued operations” in the income statement.

GROUP REORGANISATIONAs approved at a Distell Group Limited (DGL) scheme meeting on 27 October 2017, the shareholding structure of DGL was simplified in May and June 2018 through various schemes of arrangement. Previously DGL had a multi-tiered ownership structure, in which Remgro Limited (Remgro) and Capevin Holdings Limited (Capevin) owned a material interest via Remgro-Capevin Investments Proprietary Limited (RCI). Remgro and Capevin each held 50% in RCI, and RCI had a 52,8% direct interest in DGL. A new entity, Distell Group Holdings Limited (DGHL), effectively acquired RCI’s and all other shareholders’ direct and indirect interests in DGL in exchange for shares directly in DGHL. DGHL was listed on the JSE Limited (JSE) and DGL was delisted.



COMMENTARY CONTINUED

The restructuring was categorised as a capital reorganisation of an existing group and consequently the financial results of the Group are presented using the values of the previous holding company.

The collapsed structure increased free float from 19,5% to 37,5% of its shares in order to provide a simpler, single-entry point into Distell as an investment which aims to increase share liquidity and broader index inclusion over time. The average daily trading volume (ADTV) in DGH from relisting to end June was 236 979, representing a 140% increase from a year-to-date ADTV in Distell Group Limited (DST) before the relisting of 98 909.

PROSPECTSGrowth across advanced economies and most emerging markets points to a more favourable global economic outlook, but with mixed political and economic risks. Oil-rich African economies such as Angola and Nigeria have yet to benefit from higher oil prices, but remain key pockets of opportunities for the Group and its product portfolio. The acquisitions of our East and West African route-to-market (RTM) platforms affirm our approach in balancing country risk and leveraging growth opportunities.

There are still risks facing the domestic economy in the short term, with consumer income and spending under pressure and rising poverty and unemployment levels going into 2019. The recent volatility of the rand, higher grape prices as a result of the Western Cape drought and water shortages, presents additional challenges to the business in the short to medium term.

The Group looks to defend and grow its market share through an optimised brand portfolio and innovation. Whilst competition has increased in the local cider and RTD market, Distell will increase investment in the support of its Hunter’s brand, which remains the world’s second-largest cider brand by volume. It will also enhance its focus on its premium brands in wine and spirits to capture key premiumisation opportunities which exist both domestically and abroad.

Whilst the drought in the Western Cape poses a real risk to the supply of grapes and wine in the medium term, the Group has secured sufficient supply for the current cycle and invested a total of R22,0 million to waste water treatment and re-use programmes to mitigate against further water supply risks. The current 38,1% reduction in water usage as of June 2018 in the Western Cape has been achieved by accelerating the water management programme, through demand reduction management and new water-saving initiatives. Certain water-intensive production activities have also been relocated to areas with sufficient water supply.

The Group has started to fully integrate its new African RTM acquisitions as it seeks to build an effective pan-African platform in select markets. BGB will expand its presence and execute key brand and RTM initiatives on the continent.

Internationally, the Group looks to sustain the gains made in key markets and execute its whisky growth strategy and wine portfolio restructure. It will look to further grow its premium spirits portfolio whilst building a self-sufficient supply chain. Distell will continue to seek complementary acquisition opportunities alongside its disciplined approach to capital allocation.

The Group is making good progress in its two- to three-year programme to create a more agile and efficient business by restructuring its brand portfolio, asset base and operating model. Distell has a portfolio of strong, diverse and appealing brands with the ability to trade across the price continuum, taste profiles and mixed gender occasions to capture growth opportunities in both domestic and foreign markets.

DIRECTORATEMr MJ Bowman was appointed as independent non-executive director with effect from 27 October 2017, but was obliged to resign effective from 26 July 2018 due to a potential conflicting personal investment in a Western Cape-based drinks operation.



CASH DIVIDEND DECLARATIONThe directors have resolved to declare a gross cash dividend, number 1, of 230,0 cents (2017: 214,0 cents) per share for the year ended 30 June 2018. This represents a total dividend of 395,0 cents (2017: 379,0 cents) for the year and a dividend cover of 1,9 times (2017: 1,9 times) by normalised headline earnings.

The dividend has been declared from income reserves. The dividend withholding tax, levied at 20%, will amount to 46,0 cents per ordinary share. As a result, ordinary shareholders who are liable to pay dividends tax will receive a net dividend amount of 184,0 cents per share. Shareholders exempt from paying dividends tax will receive 230,0 cents per share. The issued ordinary share capital as at 23 August 2018 is 222 382 356 (2017: 222 382 356) ordinary shares. The company’s income tax reference number is 9759621163.

The dividend will be payable to shareholders who are recorded as such on the register on the record date on Friday, 14 September 2018, and will be paid on Monday, 17 September 2018. The last day to trade cum dividend will be on Tuesday, 11 September 2018, and shares commence trading ex dividend from Wednesday, 12 September 2018. Share certificates may not be dematerialised or rematerialised between Wednesday, 12 September 2018, and Friday, 14 September 2018, both days inclusive.

BASIS OF PREPARATION, ACCOUNTING POLICY AND COMPARATIVE FIGURESThese results have been prepared in accordance with section 3.46 of the Listings Requirements of the JSE Limited (JSE) and have been applied consistently to all the periods presented and the previous reporting periods, with the exception of the implementation of new accounting standards, interpretations and amendments to IFRS.

The adoption of these amendments and statements had no material impact on the consolidated results of either the current or prior periods. Comparative financial information has been restated to account for the discontinued operations relating to the Bisquit sale.

Signed on behalf of the board

JJ Durand RM RushtonChairman Group chief executive

officer

Stellenbosch23 August 2018

Directors: JJ Durand (chairman), PE Beyers, GP Dingaan, DP du Plessis, PR Louw (alternate), MJ Madungandaba, EG Matenge-Sebesho, CA Otto, AC Parker, RM Rushton (Group chief executive officer), CE Sevillano-Barredo, LC Verwey (Group chief financial officer)Company secretary: L MalanRegistered office: Aan-de-Wagenweg, Stellenbosch 7600Transfer secretaries: Computershare Investor Services Proprietary Limited, Rosebank Towers, 15 Biermann Avenue, Rosebank 2196Sponsor: RAND MERCHANT BANK (A division of FirstRand Bank Limited), 1 Merchant Place, corner of Rivonia Road and Fredman Drive, Sandton 2196Registration number: 2016/394974/06 JSE share code: DGH ISIN: ZAE000248811www.distell.co.za

COMMENTARY



BEDRYFSRESULTATE VAN VOORTGESETTE BEDRYWIGHEDEGroepomset het met 10,4% tot R24,2 miljard verhoog met verkoopsvolumes wat 4,6% hoër was. Omset, uitgesluit aksynsbelasting, het met 7,7% toegeneem.

In die plaaslike mark het omset met 10,1% gestyg en verkoopsvolumes was 4,4% hoër terwyl die ekonomie steeds lae BBP-groei getoon het as gevolg van die druk wat hoër lewenskoste op verbruikers se besteebare inkomste plaas. Die Groep se reg-om-te-drink(RTD-)portefeulje het sterk omset- en volumegroei gelewer, met Savanna en Bernini wat die botoon gevoer het te midde van strawwer mededinging, en het markaandeel in die tydperk verhoog. Die spiritualieëportefeulje het deurlopend gegroei met brandewynvolumes wat veerkragtig gebly het en whiskyvolumes wat in die tweede helfte van die finansiële jaar herstel het. Die beduidende groei in jenewervolumes het voortgeduur teen 29,3% tesame met 43,6%-groei in vodkavolumes na aanleiding van die verkryging van die premium Cruz vodka-handelsmerk gedurende die vorige finansiële jaar. Die wynportefeulje het omsetgroei van 7,4% gelewer en is steeds bevoordeel deur verbruikers van hoofstroomhandelsmerke, wat ook in die tweede helfte van die finansiële jaar herstel het, wat na meer premium handelsmerke oorskakel.

Afrika-markte, buite Suid-Afrika, se omsetgroei was 19,5% op verkoopsvolumes wat 7,0% hoër was, grotendeels gedryf deur die insluiting van KWA Holdings E.A. Limited (KHEAL) in Kenia wat in April 2017 verkry is. Fokusmarkte op die vasteland soos Botswana, Kenia, Zambië en Zimbabwe het almal sterk groei getoon. Stewige RTD-groei is deur Hunter’s en Kingfisher behaal. In Kenia kan groei in die wynportefeulje toegeskryf word aan dubbelsyferomsetgroei deur J.C. Le Roux en Nederburg en die spiritualieëportefeulje is gelei deur Kibao, Viceroy en Hunter’s Choice. Algehele bedryfsresultate is egter negatief beïnvloed deur die moeilike handelstoestande in Mosambiek en Nigerië asook ’n eenmalige negatiewe impak van die Groep se geassosieerde maatskappy Tanzania Distilleries Limited (TDL), soos hieronder aangedui. Valutadevaluasies asook die beperkte beskikbaarheid van valuta het die bedryfsresultate van ons Angolese bedrywighede in die tweede helfte van die finansiële jaar geraak. Die Afrika-streek het 55,1% tot buitelandse omset bygedra.

Verkoopsvolumes in internasionale markte buite Afrika het met 1,8% gestyg, gesteun deur Europa, Latyns-Amerika en die Asië-Pasifiese streek, sowel as Reiskleinhandel. Omset was 5,8% hoër met die verhoogde belegging in die VK wat deur die uitwerking van ’n ongunstiger verkoopsmengsel beïnvloed is. Reiskleinhandel presteer steeds goed in lyn met volumegroei in ons spiritualieëportefeulje, met Amarula- en enkelmoutwhisky-verkope wat steeds die beste vaar. Scottish Leader se markaandeel in Taiwan het verhoog te midde van ’n swakker mark. Ons siders en RTD’s het stewige volumegroei behaal as gevolg van verhoogde investering in die portefeulje, wat Bernini se volumegroei tot meer as 50% aangevuur het. Wynvolumes het konstant gebly met VK-noterings wat toegeneem het in gereedheid vir toekomstige groei.

Bedryfsuitgawes, wat die koste van die nuut-verkrygde KHEAL sowel as belegging in die Groep se gedeeldedienstebesigheid insluit, het met 11,6% toegeneem. Met uitsluiting van aksynsbelasting, wat met 16,4% toegeneem het, het ander bedryfsuitgawes met 9,7% verhoog, waarvan verkoops- en bemarkingskoste 10,0% hoër was. Ons gaan voort met ’n gestruktureerde proses om die doeltreffendhede van ons verskaffingsketting en ondersteuningsfunksies regdeur die Groep te konsolideer en te verbeter. Valutaomrekeningsverliese het R51,4 miljoen (2017: R63,3 miljoen) beloop.

Die Groep het die oorblywende 50%-aandelebelang in die gesamentlike onderneming Lusan Holdings Eiendoms Beperk (Lusan) verkry, en ’n wins van R37,8 miljoen op die Groep se voormalige ekwiteitsbelang word onder “ander winste en verliese” op die inkomstestaat aangedui.

Ingesluit by “ander winste en verliese” op die inkomstestaat is waardedalings van R78,7 miljoen vir ontasbare bates en eiendom, aanleg en toerusting, wat grotendeels verband hou met ons Asiese bedrywighede.

Netto finansieringskoste in die vorige jaar sluit ’n terugskrywing van ’n voorsiening vir rente betaalbaar van R41,9 miljoen in. Hierdie terugskrywing hou verband met ’n skikking van ’n uitgerekte aksynsregdispuut wat met die Suid-Afrikaanse Inkomstediens bereik is. Netto finansieringskoste, uitgesluit die terugskrywing, het van R256,5 miljoen tot R295,6 miljoen toegeneem.

KOMMENTAAR



Distell se aandeel in ekwiteitsverantwoorde verdienste het met 47,2% gedaal. Die bydrae van R29,8 miljoen van die nuut-verkrygde 26%-belegging in Best Global Brands Limited (BGB) is deur eenmalige verliese en waardedalings van R85,9 miljoen teëgewerk as gevolg van die uitwerking ’n sachet-verbod en aksynsregdispuut op die resultate van TDL, waarin Distell ’n 35%-belang het.

Verdienste voor rente, belasting, depresiasie en amortisasie (VVRBDA) het met 20,2% verhoog. Genormaliseerde VVRBDA, wat die uitwerking van die waardedalings, die wins met verkoop van beleggings, die eenmalige verliese in TDL, afleggings- en Groepherstruktureringskoste uitsluit, het met 6,0% gestyg. Genormaliseerde VVRBDA, met uitsluiting van valutaomrekeningsverskille, het met 7,4% verhoog.

Die effektiewe belastingkoers was 29,7% (2017: 28,4%) aangesien die waardedalings en kapitaalkoste nie belastingaftrekbaar is nie.

Wesensverdienste, ingesluit beëindigde bedrywighede, het met 5,6% tot R1,5 miljard, en wesensverdienste per aandeel met 5,7% to 668,2 sent afgeneem. Uitgesluit die valutaomrekeningsverskille, die terugskrywing van die rente en die TDL-verliese waarna hierbo verwys is, het wesensverdienste met 5,2% toegeneem. Basiese verdienste per aandeel het met 26,9% tot 750,3 sent verhoog.

BELEGGINGS EN BEFONDSING Totale bates het met 8,0% tot R22,1 miljard toegeneem.

Belegging in netto bedryfskapitaal het met 6,2% tot R6,6 miljard gedaal en is bevoordeel deur die verkoop van Bisquit Dubouché et Cie (Bisquit) waarna hieronder verwys word. Voorraad het met 2,7% tot R7,6 miljard gedaal. Hiervan het stortmaatvoorraadspiritualieë onder veroudering, wat ooreenkomstig die Groep se langtermynsiening van verbruikersvraag na sy produkte beplan word, met 11,0% tot R2,9 miljard toegeneem. Dit kan grotendeels toegeskryf word aan die verhoogde belegging in ons Skotse whisky-voorraad. Belegging in gebottelde voorraad en verpakkingsmateriaal het met 9,6% verhoog, in lyn met omsetgroei. Handels- en ander debiteure het met 14,4% toegeneem aangesien omsetgroei oor die laaste twee maande van die finansiële jaar baie hoër was as in die ooreenstemmende tydperk verlede jaar.

Kapitaalbesteding vir die tydperk het R1,17 miljard (2017: R805,6 miljoen) beloop, waarvan R464,7 miljoen vir die vervanging van bates aangewend is. ’n Verdere R710,0 miljoen is op kapasiteitsuitbreiding bestee, hoofsaaklik die uitbreiding van die Groep se sider- en spiritualieëproduksie-aanlegte.

Die Groep het in Julie 2017 26% van die gewone aandele in BGB vir VSD54,6 miljoen verkry. Die Groep het ook ’n ooreenkoms aangegaan vir die verkryging van die oorblywende 74% van die gewone aandele, wat nie vroeër as die einde van 2019 effektief sal word nie. Dié verkryging is onderworpe daaraan dat aan sekere bedryfsvereistes voldoen word en dat sekere opskortende voorwaardes vir afhandeling nagekom of van afstand gedoen is.

Netto kontant gegenereer uit bedryfsaktiwiteite het met 21,6% tot R2,3 miljard toegeneem. Die Groep verkeer steeds in ’n sterk finansiële posisie soos blyk uit die verhouding van skuld-tot-skuld-plus-ekwiteit van 22,5% (2017: 25,2%) en ’n skuld-tot-ekwiteit-verhouding van 29,0% (2017: 33,8%) aan die einde van die verslagdoeningstydperk.

BEËINDIGDE BEDRYWIGHEDEDie Groep het op 31 Januarie 2018 sy ekwiteitsbelang in Bisquit vir ’n finale kontantteenprestasie van €50,7 miljoen verkoop. Die finansiële resultate van Bisquit word nie by die voortgesette bedrywighede van die Groep ingesluit nie, maar afsonderlik in die opgesomde finansiële state as “beëindigde bedrywighede” aangedui. Die Groep se wins van R173,5 miljoen uit die verkoop van Bisquit word ook onder “beëindigde bedrywighede” op die inkomstestaat aangedui.

GROEPREORGANISASIESoos goedgekeur op ’n Distell Groep Beperk (DGL) skemavergadering op 27 Oktober 2017, is die aandelebelangstruktuur van DGL in Mei en Junie 2018 deur verskeie reëlingskemas vereenvoudig. DGL het vantevore ’n multi-vlak eienaarskapstruktuur gehad, waarvolgens Remgro Beperk (Remgro) en Capevin Holdings Beperk (Capevin) ’n wesenlike belang via Remgro-Capevin Investments Eiendoms Beperk (RCI) besit het. Remgro en Capevin het elk 50% in RCI besit, en RCI het ’n 52,8% direkte belang in DGL gehad.

KOMMENTAAR



KOMMENTAAR VERVOLG

’n Nuwe entiteit, Distell Groep Holdings Beperk (DGHB), het effektief RCI en alle ander aandeelhouers se direkte en indirekte belange in DGL verkry in ruil vir direkte aandele in DGHB. DGHB is op die JSE Beperk (JSE) genoteer en DGL is gedenoteer.

Die herstrukturering is as ’n kapitaalreorganisasie van ’n bestaande groep gekategoriseer en gevolglik word die finansiële resultate van die Groep aangebied deur gebruikmaking van die waardes van die vorige beheermaatskappy.

Die vereenvoudigde struktuur het vrylik verhandelbare aandele vanaf 19,5% tot 37,5% verhoog om ’n eenvoudiger, enkelentiteittoegang tot Distell as ’n belegging te skep met die doel om mettertyd aandeellikiditeit en breër indeksinsluiting te verhoog. Die gemiddelde daaglikse handelsvolume (GDHV) in DGH vanaf notering tot einde Junie was 236 979, wat ’n 140%-toename vanaf ’n jaar-tot-datum GDHV in Distell Groep Beperk (DGB) voor die denotering van 98 909 verteenwoordig.

VOORUITSIGTE Groei regoor gevorderde ekonomieë en die meeste ontluikende markte dui op ’n positiewer globale ekonomiese vooruitsig, maar met gemengde politieke en ekonomiese risiko’s. Olieryke Afrika-ekonomieë soos Angola en Nigerië baat nog nie by hoër oliepryse nie, maar bly geleentheidsbronne vir die Groep en sy produkportefeuljes. Die verkrygings van ons Oos- en Wes-Afrika roete-na-mark(RNM-)platforms getuig van ons benadering om die risiko’s wat ’n land inhou, met groeigeleenthede te balanseer.

Die plaaslike ekonomie staar steeds risiko’s in die kort termyn in die gesig met verbruikersinkomste en -besteding wat onder druk verkeer en stygende armoede- en werkloosheidsvlakke in aanloop tot 2019. Die onlangse wisselvalligheid van die rand, hoër druiwepryse as gevolg van die droogte in die Wes-Kaap en watertekorte skep bykomende uitdagings vir die besigheid in die kort en medium termyn.

Die Groep wil markaandeel verdedig en groei deur ’n geoptimaliseerde handelsmerkportefeulje asook innovasie. Ten spyte van strawwer mededinging in die plaaslike sider- en RTD-mark, sal Distell verder belê in die ondersteuning van sy Hunter’s-handelsmerk wat

steeds die wêreld se tweede grootste siderhandelsmerk volgens volume is. Die fokus op premium wyn- en spiritualieëhandelsmerke sal verskerp word om sleutel premiumgehalte geleenthede beide plaaslik en in die buiteland te ontsluit.

Terwyl die droogte in die Wes-Kaap ’n risiko vir die voorsiening van druiwe en wyn oor die medium termyn inhou, het die Groep voldoende voorraad bekom om die huidige siklus te voorsien. ’n Totaal van R22,0 miljoen is spandeer aan afvalwaterbehandeling en programme om water te hergebruik ten einde verdere voorsieningsrisiko’s te beperk. Die huidige 38,1%-vermindering in waterverbruik in Junie 2018 in die Wes-Kaap is behaal deur die waterbestuursprogram te versnel, aanvraagbestuur en nuwe waterbesparingsinisiatiewe. Sekere waterintensiewe produksie-aktiwiteite is ook oorgeplaas na streke wat oor voldoende watervoorraad beskik.

Die Groep het grotendeels sy nuwe Afrika RNM-verkrygings geïntegreer namate daar voortgegaan word om ’n effektiewe pan-Afrika platform in gekose markte te bou. BGB sal sy teenwoordigheid uitbrei en sleutel handelsmerk- en RNM-inisiatiewe op die kontinent loods.

Op internasionale gebied wil die Groep die vordering in sleutelmarkte uitbrei en sy whiskygroeistrategie asook wynportefeuljeherstrukturering volhou. Daar sal voortgegaan word om die spiritualieëportefeulje uit te brei terwyl ’n selfonderhoudende verskaffingsketting geskep word. Distell sal deurlopend aanvullende verkrygingsgeleenthede ondersoek in lyn met sy gedissiplineerde benadering tot kapitaaltoewysing.

Goeie vordering word gemaak met die Groep se twee- tot driejaar program om ’n leniger en doeltreffender besigheid te skep deur die herstrukturering van sy handelsmerkportefeulje, batebasis en bedryfsmodel. Distell het ’n portefeulje van sterk, diverse en aantreklike handelsmerke met die vermoë om regoor die pryskontinuum, smaakprofiele en gemengde geslag geleenthede sake te doen ten einde handelsgeleenthede in die plaaslike sowel as buitelandse markte te benut.



KOMMENTAAR

DIREKTEUREMnr MJ Bowman is met ingang van 27 Oktober 2017 as onafhanklike nie- uitvoerende direkteur aangestel, maar het met ingang van 26 Julie 2017, weens ’n potensiële botsing van belange as gevolg van ’n persoonlike belegging in ’n Wes-Kaapse drankmaatskappy, bedank.

VERKLARING VAN KONTANTDIVIDEND Die direkteure het besluit om ’n bruto kontantdividend, nommer 1, van 230,0 sent (2017: 214,0 sent) per aandeel te verklaar vir die jaar geëindig 30 Junie 2018. Dit verteenwoordig ’n totale dividend van 395,0 sent (2017: 379,0 sent) vir die jaar en ’n dividenddekking van 1,9 keer (2017: 1,9 keer) op genormaliseerde wesensverdienste.

Die dividend is uit inkomstereserwes verklaar. Die dividendweerhoubelasting, wat teen 20% gehef word, sal 46,0 sent per gewone aandeel bedra. Gewone aandeelhouers wat onderworpe is aan dividendweerhoubelasting sal gevolglik ’n netto dividend van 184,0 sent per aandeel ontvang. Aandeelhouers wat vrygestel is van die betaling van dividendweerhoubelasting sal 230,0 sent per aandeel ontvang. Die uitgereikte gewone aandelekapitaal soos op 23 Augustus 2018 is 222 382 356 (2017: 222 382 356) gewone aandele. Die maatskappy se inkomstebelastingverwysingsnommer is 9759621163.

Die dividend sal betaalbaar wees aan aandeelhouers op rekord op die rekorddatum op Vrydag, 14 September 2018, en sal op Maandag, 17 September 2018, betaal word. Die laaste dag vir verhandeling met dividende is Dinsdag, 11 September 2018, en die aandeel sal

sonder dividende begin verhandel vanaf Woensdag, 12 September 2018. Aandeelsertifikate mag nie in die tydperk van Woensdag, 12 September 2018, tot Vrydag, 14 September 2018, albei datums ingesluit, gedematerialiseer of gerematerialiseer word nie.

VOORBEREIDINGSGRONDSLAG, REKENINGKUNDIGE BELEID EN VERGELYKENDE SYFERSHierdie resultate is ooreenkomstig artikel 3.46 van die JSE Beperk (JSE) se Noteringsvereistes opgestel en is konsekwent toegepas in al die tydperke wat aangebied word asook die vorige verslagdoeningstydperke, met uitsondering van die implementering van nuwe rekeningkundige standaarde, interpretasies en wysigings aan IFRS.

Die implementering van hierdie wysigings en standpunte het geen wesenlike uitwerking op die gekonsolideerde resultate van die huidige of vorige tydperke nie. Vergelykbare finansiële inligting word heraangegee vir verrekening van die beëindigde bedrywighede met betrekking tot die Bisquit-verkoop.

Geteken namens die direksie

JJ Durand RM RushtonVoorsitter Groep- hoof uitvoerende

beampte

Stellenbosch23 Augustus 2018

Direkteure: JJ Durand (voorsitter), PE Beyers, GP Dingaan, DP du Plessis, PR Louw (alternatief), MJ Madungandaba, EG Matenge-Sebesho, CA Otto, AC Parker, RM Rushton (Groep- hoof uitvoerende beampte), CE Sevillano-Barredo, LC Verwey (Groep- hoof finansiële beampte)Maatskappysekretaris: L MalanGeregistreerde kantoor: Aan-de-Wagenweg, Stellenbosch 7600Oordragsekretarisse: Computershare Investor Services Eiendoms Beperk, Rosebank Towers, Biermannlaan 15, Rosebank 2196Borg: RAND AKSEPBANK (’n Afdeling van FirstRand Bank Beperk), Merchant Place 1, h/v Rivoniaweg en Fredmanrylaan, Sandton 2196 Registrasienommer: 2016/394974/06 JSE-aandelekode: DGH ISIN: ZAE000248811www.distell.co.za



DIRECTORS’ RESPONSIBILITY FOR FINANCIAL REPORTINGFOR THE YEAR ENDED 30 JUNE 2018

The summary consolidated annual financial statements of the Group are the responsibility of the directors of Distell Group Holdings Limited. In discharging this responsibility they rely on the management of the Group to prepare the annual financial statements, separately available on www.distell.co.za, in accordance with International Financial Reporting Standards (IFRS) and the South African Companies Act (No. 71 of 2008). As such, the summary consolidated annual financial statements include amounts based on judgements and estimates made by management. The information given is comprehensive and presented in a responsible manner.

The directors accept responsibility for the preparation, integrity and fair presentation of the summary consolidated annual financial statements and are satisfied that the systems and internal financial controls implemented by management are effective.

The directors believe that the company and Group have adequate resources to continue operations as a going concern in the foreseeable future, based on forecasts and available cash resources. The annual financial statements support the viability of the company and the Group.

The independent auditing firm, PricewaterhouseCoopers Inc., which was given unrestricted access to all financial records and related data, including minutes of all meetings of shareholders, the board of directors and committees of the board, has audited the Group annual financial statements from which the summary consolidated annual financial statements were derived. The directors believe that all presentations made to the independent auditor during this audit were valid and appropriate. PricewaterhouseCoopers Inc.’s audit report is presented on page 11.

The summary consolidated annual financial statements, as set out on pages 12 to 27, were supervised by the Group chief financial officer, Lucas Verwey CA(SA), approved by the board of directors and are signed on its behalf:

JJ Durand RM RushtonChairman Group chief executive officer




INDEPENDENT AUDITOR’S REPORT

INDEPENDENT AUDITOR’S REPORT ON THE SUMMARY CONSOLIDATED FINANCIAL STATEMENTSTo the Shareholders of Distell Group Holdings Limited

OpinionThe summary consolidated financial statements of Distell Group Holdings Limited, set out on pages 12 to 27 of the Summary Consolidated Annual Financial Statements 2018, which comprise the summary consolidated statement of financial position as at 30 June 2018, the summary consolidated statements of income, comprehensive income, changes in equity and cash flows for the year then ended, and related notes, are derived from the audited consolidated financial statements of Distell Group Holdings for the year ended 30 June 2018.

In our opinion, the accompanying summary consolidated financial statements are consistent, in all material respects, with the audited consolidated financial statements, in accordance with the JSE Limited’s (JSE) requirements for summary financial statements, as set out in note 1 to the summary consolidated financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements.

Summary consolidated financial statementsThe summary consolidated financial statements do not contain all the disclosures required by International Financial Reporting Standards and the requirements of the Companies Act of South Africa as applicable to annual financial statements. Reading the summary consolidated financial statements and the auditor’s report thereon, therefore, is not a substitute for reading the audited consolidated financial statements and the auditor’s report thereon.

The audited consolidated financial statements and our report thereonWe expressed an unmodified audit opinion on the audited consolidated financial statements in our report dated 23 August 2018. That report also includes communication of key audit matters. Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the consolidated financial statements of the current period.

Director’s responsibility for the summary consolidated financial statementsThe directors are responsible for the preparation of the summary consolidated financial statements in accordance with the JSE’s requirements for summary financial statements, set out in note 1 to the summary consolidated financial statements, and the requirements of the Companies Act of South Africa as applicable to summary financial statements.

Auditor’s responsibilityOur responsibility is to express an opinion on whether the summary consolidated financial statements are consistent, in all material respects, with the audited consolidated financial statements based on our procedures, which were conducted in accordance with International Standard on Auditing (ISA) 810 (Revised), Engagements to Report on Summary Financial Statements.

PricewaterhouseCoopers Inc. Director: NH DömanRegistered Auditor




Audited 30 June

2018R’000

2017R’000

ASSETS

Non-current assets

Property, plant and equipment 6 290 094 5 466 224

Loans and receivables 20 391 133 595

Available-for-sale financial assets 60 485 29 671

Investments in associates 862 364 133 558

Investments in joint ventures 141 165 252 282

Intangible assets 2 008 475 1 921 925

Retirement benefit assets 522 885 380 963

Deferred income tax assets 100 154 173 897

Total non-current assets 10 006 013 8 492 115

Current assets

Inventories 7 587 016 7 800 305

Trade and other receivables 3 413 036 2 982 470

Current income tax assets 35 756 28 197

Cash and cash equivalents 1 084 215 1 183 120

Total current assets 12 120 023 11 994 092

Total assets 22 126 036 20 486 207

EQUITY AND LIABILITIES

Capital and reserves

Capital and reserves 11 640 693 10 542 126

Non-controlling interest 314 944 301 124

Total equity 11 955 637 10 843 250

Non-current liabilities

Interest-bearing borrowings 4 432 840 3 567 180

Retirement benefit obligations 27 800 24 533

Deferred income tax liabilities 1 132 135 929 318

Total non-current liabilities 5 592 775 4 521 031

Current liabilities

Trade and other payables 4 257 093 3 682 025

Interest-bearing borrowings 113 788 1 276 234

Provisions 167 973 89 227

Current income tax liabilities 38 770 74 440

Total current liabilities 4 577 624 5 121 926

Total equity and liabilities 22 126 036 20 486 207

SUMMARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION



SUMMARY CONSOLIDATED STATEMENTS

Audited Year ended 30 June

2018R’000

2017R’000

Change %

Revenue 24 230 765 21 940 043 10,4

Operating costs (21 836 072) (19 567 219) 11,6

Costs of goods sold (16 442 193) (14 646 189)

Sales and marketing costs (3 114 655) (2 832 148)

Distribution costs (1 246 542) (1 168 220)

Administration and other costs (1 032 682) (920 662)

Other gains and losses (6 520) (27 944)

Operating profit 2 388 173 2 344 880 1,8

Dividend income 6 657 7 163

Finance income 46 927 69 290

Finance costs (342 494) (283 800)

Share of equity-accounted earnings 31 358 59 374

Profit before taxation 2 130 621 2 196 907 (3,0)

Taxation (632 101) (623 912)

Profit for the year from continuing operations 1 498 520 1 572 995 (4,7)

Discontinued operations 169 531 (276 192)

Profit for the year 1 668 051 1 296 803 28,6

Attributable to:

Equity holders of the company 1 646 384 1 296 978 26,9

Non-controlling interest 21 667 (175)

1 668 051 1 296 803 28,6

Per share performance:

Issued number of ordinary shares (’000) 222 382 222 382

Weighted number of ordinary shares (’000) 219 443 219 298

Earnings per ordinary share (cents)

Basic earnings basis

From continuing operations 673,0 717,3 (6,2)

From discontinued operations 77,3 (125,9) 161,4

750,3 591,4 26,9

Diluted earnings basis


From discontinued operations 77,2 (125,8) 161,4

749,5 590,6 26,9

SUMMARY CONSOLIDATED INCOME STATEMENT




2018R’000

2017R’000

Change %

Headline basis


From discontinued operations (1,7) (6,5) 73,8

668,2 708,3 (5,7)

Diluted headline basis


From discontinued operations (1,8) (6,5) 72,3

667,5 707,3 (5,6)

Dividends per ordinary share (cents)

– Interim 165,0 165,0 –

– Final 230,0 214,0 7,5

395,0 379,0 4,2

Reconciliation of headline earnings:

Net profit attributable to equity holders of the company 1 646 384 1 296 978 26,9

Adjusted for (net of taxation):

Profit on disposal and impairment of PPE included in share of equity-accounted earnings (16 025) –

Impairment of intangible assets 31 115 202 071

Impairment of PPE 37 178 66 090

Impairment of investment in available-for-sale financial asset – 38 810

Gain on previously held equity interest and on sale of investments (217 338) 7 425

Profit on sale of PPE (15 086) (58 072)

Headline earnings 1 466 228 1 553 302 (5,6)

SUMMARY CONSOLIDATED INCOME STATEMENT CONTINUED




SUMMARY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


2018R’000

2017R’000

Profit for the year 1 668 051 1 296 803

Other comprehensive income (net of taxation) 263 414 (535 729)

Items that may be reclassified subsequently to profit or loss:

Fair value adjustments

– Available-for-sale financial assets 7 662 (2 668)

Currency translation differences 144 157 (565 307)

Fair value adjustments of cash flow hedges 9 115 (9 115)

Items that will not be reclassified to profit or loss:

Remeasurements of post-employment benefits 102 140 43 703

Share of other comprehensive income of associates 340 (2 342)

Total comprehensive income for the year 1 931 465 761 074

Attributable to:

Equity holders of the company 1 911 333 760 109

Non-controlling interest 20 132 965

1 931 465 761 074

Total comprehensive income attributable to equity shareholders arises from:

Continuing operations 1 741 802 1 072 128

Discontinued operations 169 531 (312 019)

1 911 333 760 109



SUMMARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY


2018R’000

2017R’000

Attributable to equity holdersOpening balance 10 542 126 10 656 997 Comprehensive income Profit for the year 1 646 384 1 296 978 Other comprehensive income (net of taxation) Fair value adjustments:

– Available-for-sale financial assets 7 662 (2 668)Cash flow hedge of foreign exchange transactions 9 115 (9 115)Currency translation differences 145 692 (566 447)Remeasurements of post-employment benefits 102 140 43 703 Share of other comprehensive income of associates 340 (2 342)Total other comprehensive income 264 949 (536 869)Total comprehensive income for the year 1 911 333 760 109 Redemption reserve – (37 340)Transactions with owners Employee share scheme:

– Shares paid and delivered 1 3 104 – Value of employee services 49 926 53 595 – Settlement in cash – (38 031)Capital reorganisation 13 832 –Share issue costs (45 066) –Sale of interest to non-controlling interest – (1 350)Dividends paid (832 778) (832 100)Transactions with non-controlling interests 1 319 (22 858)Total transactions with owners (812 766) (874 980)Attributable to equity holders 11 640 693 10 542 126 Non-controlling interest Opening balance 301 124 15 262 Profit for the year 21 667 (175)Dividends paid (4 466) (2 024)Sale of interest to non-controlling interest – (6 564)Currency translation differences (1 535) 1 140 Contribution by non-controlling interests – 40 303 Transactions with non-controlling interests (1 846) 22 858 Non-controlling interest arising on business combination – 230 324 Total non-controlling interest 314 944 301 124 Total equity at the end of the year 11 955 637 10 843 250



SUMMARY CONSOLIDATED STATEMENT OF CASH FLOWS


2018R’000

2017R’000

Cash flows from operating activities

Operating profit 2 559 330 2 066 758

Non-cash flow items 693 155 910 419

Working capital changes (173 321) (315 504)

Inventories (245 024) (136 752)

Trade and other receivables (208 022) (368 435)

Trade payables and provisions 279 725 189 683

Cash generated from operations 3 079 164 2 661 673

Net financing costs (231 935) (297 055)

Taxation paid (580 575) (500 341)

Net cash generated from operating activities 2 266 654 1 864 277

Net cash outflow from investment activities (1 144 635) (949 638)

Net cash inflow from financing activities 378 988 151 428

Dividends paid (837 244) (832 100)

Increase in net cash, cash equivalents and bank overdrafts 663 763 233 967

Net cash, cash equivalents and bank overdrafts at the beginning of the year 302 876 102 402

Exchange gains on cash and cash equivalents and bank overdrafts 3 788 (33 493)

Net cash, cash equivalents and bank overdrafts at the end of the year 970 427 302 876




1. BASIS OF PREPARATION, ACCOUNTING POLICY AND COMPARATIVE FIGURESThe summary consolidated annual financial statements have been prepared in accordance with the Listings Requirements of the JSE Limited (JSE) for summary financial statements and the requirements of the Companies Act (No 71 of 2008), as amended, as applicable to summary financial statements. The JSE requires summary financial statements to be prepared in accordance with the framework concepts, the measurement and recognition requirements of International Financial Reporting Standards (IFRS), the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and also to, as a minimum, contain the information required by IAS 34: Interim Financial Reporting. The directors are responsible for the preparation of the summary consolidated annual financial statements, prepared under supervision of the Group chief financial officer, LC Verwey CA(SA).

The accounting policies applied in the preparation of the consolidated annual financial statements from which the summary consolidated annual financial statements were derived are in terms of IFRS and are consistent with the accounting policies applied in the preparation of the previous consolidated annual financial statements. Comparative financial information has been restated to account for the discontinued operations relating to the Bisquit sale.

The Group has adopted all new as well as amended accounting pronouncements issued by the International Accounting Standards Board (IASB) that are effective for financial years commencing 1 July 2017. None of the new or amended accounting pronouncements that are effective for the financial year commencing 1 July 2017 has a material impact on the consolidated results of the Group.

Audited 30 June

2018 R’000

2017 R’000

Change %

2. SALES VOLUMES (LITRES ’000) 715 005 683 801 4,6

3. PRO FORMA INFORMATIONThe results of the Group are significantly impacted by abnormal or non-recurring transactions and the change in foreign exchange rates.

The Group therefore also discloses adjusted measures in order to indicate the Group’s businesses’ performance excluding the effect of abnormal transactions and foreign currency fluctuations. These adjusted measures constitute pro forma financial information.

The adjustments below represents abnormal or non-recurring items which significantly impacted the financial results of the Group:

Headline earnings 1 466 228 1 553 302 (5,6)


Interest income on settlement of excise dispute – (41 949)

One-off losses and write-offs in associate following sachet ban and excise dispute 78 461 22 204

Retrenchment and Group restructuring costs 40 688 17 031

Normalised headline earnings 1 585 377 1 550 588 2,2

NOTES TO THE SUMMARY CONSOLIDATED ANNUAL FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2018



NOTES TO THE SUMMARY CONSOLIDATED STATEMENTS

Audited 30 June

2018 R’000

2017 R’000

Change %

3. PRO FORMA INFORMATION CONTINUED

The results of the Group are also significantly impacted by the change in foreign exchange rates, mainly relating to the UK pound, euro, US dollar and Angola kwanza for both reporting periods, as a result of:a) the translation of foreign operations to the reporting

currency; andb) the translation of South African monetary assets and

liabilities denominated in foreign currency to the reporting currency at year-end.

In the prior year comparative period, the income of foreign subsidiaries was converted at an average aggregated daily South African rand (ZAR)/US dollar (USD) exchange rate of R13,61 compared to R12,87 in the current year, and the Angola kwanza devaluated from 167 kwanza:USD1 on 30 June 2017 to 250 kwanza:USD1 on 30 June 2018.

The adjustments below thus represent a restatement of the 2017 foreign income using the current year aggregated daily average exchange rates.

Normalised headline earnings 1 585 377 1 550 588 2,2


Prior year restatement to current year aggregated daily average exchange rates – 1 930

Exclusion of effect of conversion of foreign currency monetary assets and liabilities to the reporting currency

– Other major currencies 37 956 46 885

– Kwanza (in associate) 59 112 –

Normalised headline earnings adjusted for foreign exchange movements 1 682 445 1 599 403 5,2

Earnings before interest, taxation, depreciation and amortisation (EBITDA) 3 091 585 2 572 717 20,2

Adjusted for:

Impairment of PPE, intangible assets, investments, gain on previously held interest and subsidiaries disposed (182 962) 250 120

Losses and write-offs in associate following sachet ban and excise dispute 78 461 22 204

Retrenchment and Group restructuring costs 53 898 23 819

Normalised EBITDA 3 040 982 2 868 860 6,0



Audited 30 June

2018 R’000

2017 R’000

Change %

3. PRO FORMA INFORMATION CONTINUEDThe adjustments below represents a restatement of the 2017 foreign income using the current year aggregated daily average exchange rates as explained on the previous page.

Normalised EBITDA 3 040 982 2 868 860 6,0

Adjusted for:

Prior year restatement to current year aggregated daily average exchange rates – 2 699

Exclusion of effect of conversion of foreign currency monetary assets and liabilities to the reporting currency

– Other major currencies 53 086 65 573

– Kwanza (in associate) 59 112 –

Normalised EBITDA adjusted for currency movements 3 153 180 2 937 132 7,4

The pro forma financial information is the responsibility of the board of directors of the company and is presented for illustrative purposes only. Because of its nature, the pro forma financial information may not fairly present the Group’s financial position, changes in equity, results of operations or cash flows.

An assurance report (in terms of ISAE 3420: Assurance Engagement to Report on the Compilation of Pro Forma Financial Information) has been issued by the Group’s auditors in respect of the pro forma financial information included in this announcement. The assurance report is available for inspection at the registered office of the company and will be included in the integrated report 2018.

Audited 30 June

2018 R’000

2017 R’000

4. NET INTEREST-BEARING BORROWINGS

Interest-bearing borrowings

Non-current 4 432 840 3 567 180

Current 113 788 1 276 234

4 546 628 4 843 414

Cash and cash equivalents (1 084 215) (1 183 120)

3 462 413 3 660 294

NOTES TO THE SUMMARY CONSOLIDATED ANNUAL FINANCIAL STATEMENTS CONTINUEDFOR THE YEAR ENDED 30 JUNE 2018



Audited 30 June

2018 R’000

2017 R’000

5. CASH OUTFLOW FROM INVESTMENT ACTIVITIES

Purchases of PPE to maintain operations (464 731) (327 784)

Purchases of PPE to expand operations (709 958) (477 775)

Proceeds from sale of PPE 126 356 56 698

Purchases of financial assets, associates and joint ventures (752 722) (12 028)

Proceeds from financial assets 17 514 57 919

Purchases of intangible assets (66 706) (89 113)

Proceeds from intangible assets 5 400 –

Proceeds from disposal of interest in subsidiaries, net of cash 757 114 20 541

Acquisition of subsidiaries, net of cash (56 902) (178 096)

(1 144 635) (949 638)

6. CAPITAL COMMITMENTS

Contracted 467 327 657 552

Authorised, but not contracted 1 991 198 2 416 566

2 458 525 3 074 118

7. DEPRECIATION OF PPE 432 434 393 555

8. NET ASSET VALUE PER SHARE (CENTS) 5 376 4 876




9. SEGMENTAL ANALYSISOperating segments were identified based on financial information reviewed regularly by management for the purpose of assessing performance and allocating resources to these segments. Revenue includes excise duty. Segment information, including the comparative figures and volume information, have been restated to align with the current year segmentation as reported to management.

Audited year ended 30 June 2018

South AfricaR’000

BLNSR’000

Rest of AfricaR’000

EuropeR’000

Rest of International

R’000Corporate

R’000Total

R’000Change

%

Revenue 18 089 389 1 900 971 1 515 685 1 283 984 1 501 580 (60 844) 24 230 765 10,4

Costs of goods sold (12 539 388) (1 300 785) (1 003 475) (846 008) (766 095) 13 558 (16 442 193) 12,3

Material costs and overheads (12 539 388) (1 300 785) (1 003 475) (846 008) (766 095) 66 644 (16 389 107) 12,4

Currency conversion gains and losses – – – – – (53 086) (53 086)

Gross profit 5 550 001 600 186 512 210 437 976 735 485 (47 286) 7 788 572 6,8

Operating costs (2 529 844) (228 283) (348 814) (357 770) (561 653) (1 367 515) (5 393 879) 9,6

Operating profit before allocations 3 020 157 371 903 163 396 80 206 173 832 (1 414 801) 2 394 693 0,9

Equity-accounted earnings and dividend income – – 7 596 – (3 930) 34 349 38 015

EBIT before allocations 3 020 157 371 903 170 992 80 206 169 902 (1 380 452) 2 432 708 (0,3)

Allocations (88 463) (15 603) (2 948) (5 231) (3 912) 116 157 –

EBIT after allocations 2 931 694 356 300 168 044 74 975 165 990 (1 264 295) 2 432 708 (0,3)

Other gains and losses – – – – – (6 520) (6 520)

Equity-accounted earnings and dividend income – – (7 596) – 3 930 (34 349) (38 015) (42,9)

Operating profit from continuing operations 2 931 694 356 300 160 448 74 975 169 920 (1 305 164) 2 388 173 1,8

EBIT before allocations attributable to:

Equity holders of the company 3 021 680 370 410 156 853 80 206 182 694 (1 400 802) 2 411 041

Non-controlling interest (1 523) 1 493 14 139 – (12 792) 20 350 21 667

3 020 157 371 903 170 992 80 206 169 902 (1 380 452) 2 432 708

Non-current assets 6 136 254 93 028 1 579 210 2 190 130 7 391 – 10 006 013





South AfricaR’000

BLNSR’000


EuropeR’000


R’000Corporate

R’000Total

R’000Change

%

Revenue 18 089 389 1 900 971 1 515 685 1 283 984 1 501 580 (60 844) 24 230 765 10,4

Costs of goods sold (12 539 388) (1 300 785) (1 003 475) (846 008) (766 095) 13 558 (16 442 193) 12,3

Material costs and overheads (12 539 388) (1 300 785) (1 003 475) (846 008) (766 095) 66 644 (16 389 107) 12,4


Gross profit 5 550 001 600 186 512 210 437 976 735 485 (47 286) 7 788 572 6,8

Operating costs (2 529 844) (228 283) (348 814) (357 770) (561 653) (1 367 515) (5 393 879) 9,6

Operating profit before allocations 3 020 157 371 903 163 396 80 206 173 832 (1 414 801) 2 394 693 0,9


EBIT before allocations 3 020 157 371 903 170 992 80 206 169 902 (1 380 452) 2 432 708 (0,3)

Allocations (88 463) (15 603) (2 948) (5 231) (3 912) 116 157 –

EBIT after allocations 2 931 694 356 300 168 044 74 975 165 990 (1 264 295) 2 432 708 (0,3)


Equity-accounted earnings and dividend income – – (7 596) – 3 930 (34 349) (38 015) (42,9)

Operating profit from continuing operations 2 931 694 356 300 160 448 74 975 169 920 (1 305 164) 2 388 173 1,8



Non-controlling interest (1 523) 1 493 14 139 – (12 792) 20 350 21 667

3 020 157 371 903 170 992 80 206 169 902 (1 380 452) 2 432 708

Non-current assets 6 136 254 93 028 1 579 210 2 190 130 7 391 – 10 006 013






South AfricaR’000

BLNSR’000


EuropeR’000


R’000Corporate

R’000Total

R’000

9. SEGMENTAL ANALYSIS CONTINUEDRevenue 16 429 151 1 748 742 1 109 833 1 117 562 1 514 759 19 996 21 940 043

Costs of goods sold (11 086 369) (1 158 675) (724 748) (696 581) (701 622) (278 194) (14 646 189)

Material costs and overheads (11 086 369) (1 158 675) (724 748) (696 581) (701 622) (212 621) (14 580 616)


Gross profit 5 342 782 590 067 385 085 420 981 813 137 (258 198) 7 293 854

Operating costs (2 325 221) (218 779) (201 682) (287 593) (581 808) (1 305 947) (4 921 030)

Operating profit before allocations 3 017 561 371 288 183 403 133 388 231 329 (1 564 145) 2 372 824


EBIT before allocations 3 017 561 371 288 209 901 133 388 225 984 (1 518 761) 2 439 361

Allocations (167 519) (58 595) (19 828) (14 532) (10 800) 271 274 –

EBIT after allocations 2 850 042 312 693 190 073 118 856 215 184 (1 247 487) 2 439 361


Equity-accounted earnings and dividend income – – (26 498) – 5 345 (45 384) (66 537)

Operating profit from continuing operations 2 850 042 312 693 163 575 118 856 220 529 (1 320 815) 2 344 880



Non-controlling interest (1 464) 1 464 (5 217) – (7 536) 12 578 (175)

3 017 561 371 288 209 901 133 388 225 984 (1 518 761) 2 439 361

Non-current assets 5 334 336 95 941 564 908 2 465 966 30 964 – 8 492 115

Note: BLNS = Botswana, Lesotho, Namibia and Swaziland EBIT = Earnings before interest and tax

Included in “Corporate” are production variances from standard as production facilities service various regions, currency conversion gains and losses, performance bonuses for the majority of personnel in the Group, and certain centralised functions including information and communications technology, human resources, corporate finance and governance, quality management, innovation and corporate affairs.



10. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS

Financial risk factors

The Group’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk.

The summary consolidated annual financial statements do not include all financial risk management information and disclosures required in the annual financial statements; they should be read in conjunction with the Group’s annual financial statements as at 30 June 2018. There have been no material changes in the Group’s credit, liquidity and market risk or key inputs in measuring fair value since 30 June 2017.

Fair value estimation

Items carried at fair value are classified according to the fair value hierarchy, by valuation method. The different levels have been defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities

Level 2: Inputs other than quoted prices included within level 1 that are observable for the asset or liability, either directly (that is, as prices) or indirectly (that is, derived from prices)

Level 3: Inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs)

Available-for-sale financial assets are classified as level 1, 2 or 3 and derivative financial assets and liabilities are classified as level 2.

Fair value measurements at 30 June 2018:

Level 1R’000

Level 2R’000

Level 3R’000

TotalR’000

Available-for-sale financial assets 3 741 16 212 40 532 60 485

Derivative financial assets – 7 370 – 7 370

Derivative financial liabilities – (3 323) – (3 323)

3 741 20 259 40 532 64 532

There have been no transfers between level 1, 2 or 3 during the period, nor were there any significant changes to the valuation techniques and inputs used to determine fair values.

Valuation techniques used to derive level 2 and 3 fair values:

Available-for-sales financial assets

These are valued using discounted cash flow techniques.

Derivative financial assets and liabilities include the following:

Forward foreign exchange contracts

These are valued using foreign exchange bid or offer rates at the year-end.





10. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS CONTINUEDThe movement in level 3 assets for the period ended 30 June 2018 is as follows:

2018R’000

2017R’000

Opening balance 14 113 46 140

Transfers from level 2 – 14 073

Fair value adjustments 5 109 –

Acquisitions 21 350 –

Disposals (40) –

Impairments – (46 100)

Balance at the end of the period 40 532 14 113

Financial liabilities for which fair value is disclosed:

Carryingvalue

R’000

Fairvalue

R’000Level 1R’000

Level 2R’000

Level 3R’000

Bank borrowings 4 432 840 4 478 272 – 4 478 272 –

The fair value of non-current borrowings is calculated using cash flows discounted at a borrowings rate and this is classified as level 2. The fair value of current borrowings equals their carrying amount.

The fair values of all other financial assets and liabilities approximate their carrying amounts.

11. BUSINESS COMBINATIONSDuring the period the Group acquired the following interest which was accounted for under IFRS 3: Business Combinations.

a) Acquisition of Lusan Holdings Proprietary Limited (Lusan)

At the end of October 2017 the Group acquired the remaining 50,0% of the issued share capital of the Lusan joint venture, a Stellenbosch-based wine producer and owner of the Alto and Uitkyk wine farms, for a purchase consideration of R193,5 million. The Group recorded a gain on its previously held equity interest of R37,8 million and no goodwill related to the acquisition was recognised. The revenue of Lusan included in the consolidated income statement since November 2017 was R9,0 million and the company contributed profit of R29,8 million over the same period.



NOTICE TO SHAREHOLDERS OF AN ANNUAL GENERAL MEETING

Distell Group Holdings Limited(Incorporated in the Republic of South Africa)(Registration number 2016/394974/06)(JSE share code: DGH ISIN: ZAE000248811)(“the company”)

Notice is hereby given, in terms of section 62(1) of the Companies Act, No. 71 of 2008 (as amended) (“Companies Act”) to shareholders of the company that the 1st annual general meeting of shareholders of the company will be held on Wednesday, 24 October 2018 at 11:00 at Nederburg Wines, Sonstraal Road, Daljosafat, Paarl, Western Cape, to consider and, if deemed fit, pass the listed resolutions with or without modification.

APPROVALS REQUIRED FOR RESOLUTIONSOrdinary resolutions numbers 1 to 7 contained in this notice of the annual general meeting require approval by more than 50% (fifty per cent) of the votes exercised on the resolutions by shareholders present or represented by proxy at the annual general meeting, subject to the requirements of the Companies Act, the Memorandum of Incorporation of the company (“MOI”) and the provisions of the listings requirements of the JSE Limited (“Listings Requirements”).

Special resolutions numbers 1 to 4 contained in this notice of an annual general meeting require approval by at least 75% (seventy-five per cent) of the votes exercised on the resolutions by shareholders present or represented by proxy at the annual general meeting, subject to the requirements of the Companies Act, the MOI and the Listings Requirements.

1. Adoption of the audited annual financial statements for the year ended 30 June 2018The audited annual financial statements are reflected on pages 105 to 201 of the 2018 integrated report available online at www.distell.co.za. The audited annual financial statements of the company for the financial year ended 30 June 2018, including the directors’ report, the reports of the independent auditors, the audit committee and the social and ethics committee contained therein, are submitted for consideration and adoption.

Ordinary resolution number 1“Resolved that the audited annual financial statements of the company for the year ended 30 June 2018, together with the reports of the independent auditors, the audit committee, the social and ethics committee and directors contained therein, be considered, accepted and adopted.”

2. Reappointment of PricewaterhouseCoopers Inc. as independent auditors of the company for the 2018/2019 financial yearThe audit committee has recommended the reappointment of PricewaterhouseCoopers Inc. as independent auditors of the company for the 2018/2019 financial year. Ms Rika Labuschaigne will be the individual designated auditor and take over from Mr Hein Döman.

Ordinary resolution number 2“Resolved that PricewaterhouseCoopers Inc. be reappointed as the company’s auditors for the 2018/2019 financial year; and it is noted that Ms Rika Labuschaigne will be the individual designated auditor.”



NOTICE TO SHAREHOLDERS

3. Retirement and re-election of the directorsJJ Durand, CA Otto and AC Parker, whose biographical details appear below, retire by rotation and are eligible and offer themselves for re-election.

Ordinary resolutions numbers 3.1 to 3.3“Resolved that the following directors, who retires by rotation in terms of the MOI, being eligible and offering themselves for re-election, be re-elected as directors of the company, each by way of a separate vote:3.1 JJ Durand3.2 CA Otto3.3 AC Parker”

3.1 JJ Durand (51) BAcc Hons, MPhil (Oxon), CA(SA)

Tenure and committees: Appointed to the board, remuneration committee and the nomination committee in 2012 and as a member of the investment subcommittee in 2015. Appointed as chairperson of the board in 2016 and as chairperson of the investment subcommittee in 2015.

Expertise: Financial markets and investments, international business, general business, mergers and acquisitions, marketing, fast-moving consumer goods, manufacturing, legal and governance.

Other: Chief executive officer of Remgro Limited and a director of, inter alia, RCL Foods Limited, RMI Holdings Limited and Mediclinic International PLC.

3.2 CA Otto (68) BCom LLB

Tenure and committees: Appointed to the board in 2011 and as a member of the investment subcommittee in 2015.

Expertise: Financial markets and investments, international business, general business, mergers and acquisitions, retail operations, marketing, manufacturing, risk management, legal, human resources, sustainability and governance.

Other: Founder director of PSG Group, Capitec Bank Holdings and Zeder Investments. He is also non-executive director of Kaap Agri Limited and serves on selected audit and remuneration committees.

3.3 AC Parker (67) MCom

Tenure and committees: Appointed to the board in 2008 and as lead independent director in 2016. He was appointed as chairperson of the remuneration committee in 2013 and as chairperson of the nomination committee in 2017. He has been a member of the investment subcommittee since 2015.

Expertise: International business, general business, mergers and acquisitions, marketing and fast- moving consumer goods.

Other: Retired managing director of SABMiller Africa and Asia, where he served on several boards of SABMiller subsidiaries, and was also an executive committee member of SABMiller plc. He is also a director of Standard Bank of South Africa Limited.



4. Election of audit committee membersThe board, through the nomination committee, nominated the directors listed below for election as members of the audit committee. The reason for ordinary resolutions numbers 4.1 to 4.4 is that the company must appoint an audit committee and the Companies Act require such members to be appointed by the shareholders at each annual general meeting.

The nomination committee is satisfied that each nominated member meets the requirements of sections 94(4) and 94(5) of the Companies Act and regulation 42 of the Companies Regulations, 2011 (“Regulations”), and also the recommendations of the King IV Report on Corporate Governance™ for South Africa, 2016 (“King IV™”).

Ordinary resolutions numbers 4.1 to 4.4“Resolved that the following independent non-executive directors be elected, each by way of a separate vote, as members of the audit committee for the ensuing year:4.1 GP Dingaan 4.2 Dr DP du Plessis4.3 EG Matenge-Sebesho4.4 CE Sevillano-Barredo”

4.1 GP Dingaan (42) BCom (Accounting), H Dip Acc, CA(SA)

Tenure and committees: Appointed to the board in 2005, as a member of the audit committee in 2006, as chairperson of the social and ethics committee in 2012, as a member of the risk and compliance committee in 2016, as a member of the investment subcommittee in 2015 and as a member of the remuneration committee and the nomination committee in 2017.

Expertise: Financial markets and investments, general business, mergers and acquisitions, transformation, risk management and governance.

Other: Investment executive at WIPHOLD Proprietary Limited, and non-executive board member and audit committee member of Landis+Gyr, SA Corporate Real Estate Limited. She is also a non-executive board member of Adcorp Holdings Limited and Sasfin Holdings Limited.

4.2 Dr DP du Plessis (63) BSc (QS), MBA (Cum Laude), DBA (Doctor

of Business Administration – Finance), Chartered Director (SA)

Tenure and committees: Appointed to the board in November 2015, as member of the audit committee in 2016, as chairman of the risk and compliance committee in 2016 and as a member of the social and ethics committee in 2016.

Expertise: Financial markets and investments, international business, general business, governance, mergers and acquisitions, and risk management.

Other: Chairperson of Plexus Holdings Proprietary Limited, an investment management business he founded in 1995. He also serves as chairperson of the Institute of Directors in Southern Africa and Bridge Fund Managers, and as director of PPS Insurance Company Limited. He is a member of the advisory board of the University of Stellenbosch Business School (USB), chairperson of the audit and risk committee and a member of the investment committee of Stellenbosch University. Additionally, he is professor extraordinaire at the USB, Honorary Consul General of Slovenia for South Africa and Deputy Dean of the Consular Corps of Cape Town.

4.3 Ethel Matenge-Sebesho (62) MBA (Brunel University of London)

and CAIB(SA)

Tenure and committees: Appointed to the board in 2015 and as member of the risk and compliance committee in 2016

NOTICE TO SHAREHOLDERS OF AN ANNUAL GENERAL MEETING CONTINUED




Expertise: Financial markets and investments, international business, general business, marketing, risk management and governance

Other: Director on the boards of FirstRand and FinMark Trust

4.4 CE Sevillano-Barredo (55) BCom (Hons), CA(SA)

Tenure and committees: Appointed to the board in 2008, as chairperson of the audit committee in 2009, as member of the risk and compliance committee in 2016 and investment subcommittee in 2015.

Expertise: Financial markets and investments, international business, general business, mergers and acquisitions, transformation, risk management and governance.

Other: Founder, director and chief financial officer of the Universal Healthcare group of companies and formerly a director of WIPHOLD. She was also a member of WIPHOLD’s audit committee and chaired Concor Proprietary Limited’s audit committee.

5. Authority to place unissued shares under the control of the directorsIt is proposed that a certain portion of the company’s authorised but unissued shares, which complies with the Companies Act, the MOI and the Listings Requirements, be placed under the control of the board, to enable the board to allot, issue and dispose of same as it deems fit.

Ordinary resolution number 5“Resolved that 0.1% of the authorised but unissued shares in the company be and are hereby placed under the control of the directors, who are hereby authorised to allot, issue and otherwise dispose of such shares in the company upon such terms and conditions as the directors in their sole discretion deem fit, subject to the provisions of the Companies Act, the MOI and the Listings Requirements, where applicable.”

6. Non-binding advisory vote to endorse the remuneration policyKing IV™ recommends, and the Listings Requirements require, that the remuneration policy of a company be tabled for a non-binding advisory vote by shareholders at each annual general meeting.

The reason for ordinary resolution number 6 is to enable the shareholders to express their views on the remuneration policy of the company. Ordinary resolution number 6 is an advisory vote only, and any failure to procure the required votes to pass the non-binding advisory vote will not have any legal consequences relating to existing remuneration agreements. The board will, however, take cognizance of the outcome of the vote and implement appropriate action, as detailed in the company’s remuneration policy.

The shareholders are requested to endorse the company’s remuneration policy, by way of non-binding advisory vote, which is set out in the Remuneration Report on pages 82 to 91 of the 2018 integrated report, available online at www.distell.co.za.

Ordinary resolution number 6“Resolved that the company’s remuneration policy is hereby endorsed, through a non-binding advisory vote, by the shareholders.”

Should 25% or more of the votes cast vote against this ordinary resolution, the company shall engage with shareholders as to the reasons therefore.

7. Non-binding advisory vote to endorse the implementation report on the company’s remuneration policyKing IV™ recommends that the implementation report on a company’s remuneration policy be tabled for a non-binding advisory vote by shareholders at each annual general meeting.

The reason for ordinary resolution number 7 is to enable the shareholders to express their views on the implementation of the company’s remuneration policy. Ordinary resolution



number 7 is an advisory vote only, and any failure to procure the required votes to pass the non-binding advisory vote will not have any legal consequences relating to existing remuneration agreements. The board will, however, take cognizance of the outcome of the vote and implement appropriate action, as detailed in the implementation report on the company’s remuneration policy.

The shareholders are requested to endorse the company’s implementation report on the remuneration policy, by way of non-binding advisory vote, which is set out in the Remuneration Report on pages 82 to 91 of the 2018 integrated report, available online at www.distell.co.za.

Ordinary resolution number 7“Resolved that the company’s implementation report with regard to the remuneration policy is hereby endorsed by the shareholders, through a non-binding advisory vote.”

Should 25% or more of the votes cast vote against this ordinary resolution, the company shall engage with shareholders as to the reasons therefore.

8. Approval of non-executive directors’ remuneration for the year ended 30 June 2019In terms of section 66(9) of the Companies Act, the company may pay remuneration to the directors for their service as directors only if the MOI permits the payment of such remuneration and if such remuneration is in accordance with a special resolution approved by shareholders within the previous 2 (two) years. The MOI permits the payment of remuneration to the directors. Approval from shareholders is sought for the payment of the remuneration detailed below to the directors for their service as directors.

Special resolution number 1“Resolved as a special resolution that the following annual remuneration of non- executive directors, for their service as directors and payable bi-annually in arrears, for the financial year ending 30 June 2019 be and is hereby approved:

CurrentR

ProposedR

Board chairperson 289 443 307 099

Board member 289 443 307 099

Lead independent director* 1 274 274 1 350 730

Audit chairperson 293 890 311 817

Audit member 146 128 155 042

Remuneration chairperson 207 525 220 184

Remuneration member 109 223 115 886

Social and ethics chairperson 163 836 173 830

Social and ethics member 97 428 103 371

Investment chairperson 207 525 311 817

Investment member 109 223 155 042

Risk and compliance chairperson 293 890 311 817

Risk and compliance member 146 128 155 042.”

* All the fees payable to the lead independent director are disclosed as one fee, irrespective of the number of committees on which the lead independent director serves.

9. Approval of remuneration of non-executive directors for additional services performed on behalf of the company

Some of the non-executive directors are requested to perform additional ad hoc services, as directors, for the company from time to time, over and above the service they customarily render as non-executive directors and for which they are remunerated in accordance with the special resolution contemplated in paragraph 8 above. Approval from shareholders is sought for the payment of remuneration to the non-executive directors for these additional services rendered to the company.

Special resolution number 2“Resolved as a special resolution that give the board authority to remunerate non-executive directors for any additional services which such non-executive directors may render to the company from time to time, over and above attending formal board and committee





meetings. The amount of any such additional remuneration will be determined by the Remuneration Committee consisting of disinterested directors.”

10. Financial assistance for subscription of securities in terms of section 44 of the Companies ActIt is noted that the company may from time to time provide financial assistance to any person for the purpose of, or in connection with, the subscription of any option, or any securities, issued or to be issued by the company or a related or inter-related company, or for the purchase of any securities of the company or a related or inter-related company (as contemplated in the Companies Act), whether in the form of, but not limited to, loans, guarantees, the provision of security or otherwise, on such specific terms as may be authorised by the directors of the company (collectively for the purposes of this resolution, ‘financial assistance for subscription of securities’).

Special resolution number 3“Resolved that, in terms of and subject to the provisions of section 44 of the Companies Act, including but not limited to section 44(3)(a)(ii), and provided the provisions of the MOI are complied with, the shareholders of the company hereby approve and authorise, as a general approval, the giving by the company of financial assistance for subscription of securities, whether directly or indirectly, to any person for the purpose of, or in connection with, the subscription of any option, or any securities, issued or to be issued by the company or a related or inter-related company, or for the purchase of any securities of the company or a related or inter-related company, which approval shall be valid for a period of 2 (two) years from the date this special resolution is adopted.”

11. Financial assistance in terms of section 45 of the Companies ActIt is noted that the company may from time to time provide financial assistance to persons who are related or interrelated (as contemplated in the Companies Act) to

the company (including, without limitation, any present or future subsidiaries of the company, its holding company and subsidiaries of its holding company and/or any other company or corporation that is or becomes related or interrelated to the company) (collectively for purposes of this resolution, the “affiliates”), whether in the form of, but not limited to, loans and/or loan facilities, guarantees and/or guarantee facilities, mortgages, pledges, cessions, bonds or otherwise, on such specific terms as may be authorised by the directors of the company (collectively for the purposes of this resolution, “financial assistance”).

Special resolution number 4“Resolved that, in terms of and subject to the provisions of section 45, including but not limited to section 45(3)(a)(ii), of the Companies Act and provided the provisions of the company’s MOI are complied with, the shareholders of the company hereby approve and authorise, as a general approval, the giving by the company of financial assistance, whether directly or indirectly, to any related or inter-related company or corporation, which approval shall be valid for a period of 2 (two) years from the date this special resolution is adopted.”

12. Social and ethics committeeShareholders are requested to review and consider the report of the social and ethics committee, as set out on pages 102 to 103 of the 2018 integrated report, which is available online at www.distell.co.za, in accordance with the Regulations. The chairperson of the social and ethics committee will be present at the annual general meeting to respond to any questions which may be asked. Any specific questions on this report and/or to the social and ethics committee should be sent to the company secretary prior to the annual general meeting.

13. Other businessTo transact any other business that may be transacted at an annual general meeting.



Record dateIn terms of section 59(1)(a) of the Companies Act, the record date, for the purpose of determining which shareholders of the company are entitled to receive notice of the annual general meeting, is Friday, 7 September 2018, and in terms of section 59(1)(b) of the Companies Act, the record date for purposes of determining which shareholders of the company are entitled to participate in and vote at the annual general meeting, is Friday, 19 October 2018. Accordingly, the last day to trade in order to be registered in the register of members of the company and therefore be eligible to participate in and vote at the annual general meeting is Tuesday, 16 October 2018.

Voting and proxiesOn a poll, every shareholder of the company shall have one vote for every ordinary share held in the company by such shareholder and one vote for every B share held in the company by such shareholder. On a show of hands, every member of the company present in person or represented by proxy shall have one vote only.

For the orderly arrangement of matters (but not required), proxy forms should be forwarded to the company, so as to be received by the company’s transfer secretaries, ´Computershare Investor Services Proprietary Limited, Rosebank Towers, 15 Biermann Avenue, Rosebank, 2196 or posted to the transfer secretaries at PO Box 61051, Marshalltown, 2107, South Africa by 13:00 (South African time) on Monday, 22 October 2018. Alternatively, proxy forms may be handed to the chairperson of the annual general meeting on the date of the annual general meeting and prior to its commencement. Proxy forms must only be completed by shareholders who have not dematerialised their shares or who have dematerialised their shares with “own name” registration.

Shareholders who have dematerialised their shares, other than those shareholders who have dematerialised their shares with “own name” registration, must NOT complete the proxy form, but should contact their Central Securities Depository Participant (“CSDP”) or broker in the manner and time stipulated in their custody agreement:

− to furnish their CSDP or broker with their voting instructions; and

− any shareholder who holds dematerialised ordinary shares in the company and has not selected “own name” registration, should contact his CSDP or broker in the manner and time stipulated in such shareholder’s agreement with his CSDP or broker in order to furnish them with such shareholder’s voting instruction. In the event that such shareholder wishes to personally attend the annual general meeting, he should contact his CSDP or broker in order to obtain the necessary authority to do so.

Shares held by a personnel share trust or scheme will not have their votes at the annual general meeting taken into account for the purposes of resolutions proposed in terms of the Listings Requirements. Treasury shares may also not vote.

Electronic participationShareholders are also able to attend and participate, but not vote, at the annual general meeting by way of a webcast. Should you wish to make use of this facility, please contact Ms Heréne Malan by email at [email protected] or telephone at +27 21 809 8104, not later than 12:30 (South African time) on Wednesday, 17 October 2018.

IdentificationPursuant to the requirements of section 62(3) of the Companies Act, notice is hereby given that in terms of section 63(1) of the Companies Act, shareholders and proxies who attend the annual general meeting will be required to provide acceptable forms of identification, i.e. a valid identity document, driver’s licence and/or passport.

Companies and other corporate bodies are advised to appoint a representative in terms of section 57(5) of the Companies Act, for which purposes a duly certified copy of the resolution appointing such a representative should be lodged with the company’s transfer secretaries at the address set out above.

By order of the board of directors

L MalanCompany secretary

Stellenbosch19 September 2018




ANNUAL GENERAL MEETING 24 October 2018

FINANCIAL REPORTInterim report February 2019Preliminary announcement of annual results August 2019

Annual financial statements 19 September 2018

Ordinary dividendsInterim dividends

− declaration February 2019 − payable March 2019

Final dividends − declaration August 2019 − payable September 2019

DATES OF IMPORTANCE TO SHAREHOLDERS



DISTELL GROUP HOLDINGS LIMITEDIncorporated in the Republic of South Africa(Registration number: 2016/394974/06)JSE share code: DGHISIN: ZAE000248811

COMPANY SECRETARYL Malan

REGISTERED OFFICEAan-de-Wagenweg, Stellenbosch 7600PO Box 184, Stellenbosch 7599Telephone: 021 809 7000Facsimile: 021 886 4611E-mail: [email protected]

TRANSFER SECRETARIESComputershare Investor Services Proprietary LimitedRosebank Towers, 15 Biermann Avenue, Rosebank 2196PO Box 61051, Marshalltown 2107Telephone: 011 370 7700Facsimile: 011 688 5238

AUDITORSPricewaterhouseCoopers Inc.Stellenbosch

LISTINGJSE LimitedSector: Consumer Goods – Food and Beverage – Beverages

SPONSORRand Merchant Bank (a division of FirstRand Bank Limited)

WEBSITEwww.distell.co.za

ADMINISTRATION


SALIENT FEATURES

1 Normalised earnings before interest, tax, depreciation and amortisation (EBITDA) refers to EBITDA adjusted for the: a) prior year impairments of Angola land and investment in a wine broker in the UK;

b) current year gain on the unbundling of Lusan and sale of Bisquit; c) one-off losses and write-off in Tanzania Distilleries Limited, an associate company, following a sachet ban and excise duty dispute; d) impairment of property, plant and equipment (PPE) and intangible assets; and e) Group restructuring and retrenchment costs.

2 Foreign currencies and abnormal transactions affect the Group’s performance. Where relevant in this report, adjusted non-IFRS measures are presented. These adjusted measures represent pro forma financial information. A reconciliation of the pro forma financial information to the equivalent IFRS metrics is provided on page 18.

+10,4%GROUP REVENUE

+7,4%1,2

NORMALISED EBITDA adjusted for forex

+4,2%TOTAL DIVIDEND

+4,6%VOLUMES

+21,6%CASH GENERATION

in harm reduction and sustainable community development

R24,0 millionINVESTED


12,2%ELECTRICITY USAGE

status maintained

Level 4B-BBEE


14,3%WATER USAGE

3,3%GREENHOUSE GAS EMISSIONS

year on year

395,0 cents per share

GREYMATTER & FINCH # 12549



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summary consolidated annual financial statements

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