Pick n Pay Group of Companies financial statements
Notes to the Group financial statements
for the period ended

26.	OPERATING SEGMENTS
	Operating segments are identified based on financial information regularly reviewed by the Chief Operating Decision Maker (CODM) of the Group for performance assessments and resource allocations. The Group annually performs a detailed review of the executives, or group of executives, that could be considered the appropriate and relevant CODM of the Group. The Pick n Pay executive committee, as detailed on page 40, is the Group’s CODM.
	The Group has two operating segments, as described below, with no individual customer accounting for more than 10% of turnover.
	South Africa – operates in various formats under the Pick n Pay and Boxer brands in South Africa. For a detailed list of store formats refer to here.
	Africa – responsible for the Group’s expansion into the rest of Africa.
	Performance is measured based on the segment profit before tax, as management believes that such information is most relevant in evaluating the results of the segments against each other and other entities that operate within the retail industry.

	Pick n Pay Stores Group		South   Africa   Total	Africa   Rm	Total   operations   Rm
	2014
	Total segment revenue		60 925.9	3 241.5	64 167.4
	External revenue		60 925.9	2 736.0	63 661.9
	Direct deliveries*		—	505.5	505.5
	Segment external turnover		60 381.0	2 736.0	63 117.0
	Profit before tax		692.7	140.4	833.1
	Other information
	Statement of comprehensive income
	Interest received		40.1	4.2	44.3
	Interest paid		143.5	0.4	143.9
	Depreciation and amortisation		923.1	25.3	948.4
	Impairment loss on intangible assets		104.1	—	104.1
	Share of associate’s income		—	32.0	32.0
	Statement of financial position
	Total assets		12 995.6	1 109.0	14 104.6
	Total liabilities		11 064.1	337.9	11 402.0
	Additions to non-current assets		1 233.8	26.2	1 260.0
	2013
	Total segment revenue**		57 951.1	2 577.3	60 528.4
	External revenue		57 951.1	1 881.9	59 833.0
	Direct deliveries*		—	695.4	695.4
	Segment external turnover***		57 389.4	1 881.9	59 271.3
	Profit before tax		716.2	92.7	808.9
	Other information
	Statement of comprehensive income
	Interest received		40.0	2.8	42.8
	Interest paid		131.3	—	131.3
	Depreciation and amortisation		881.4	14.1	895.5
	Share of associate’s income		—	23.4	23.4
	Statement of financial position
	Total assets		12 504.3	516.8	13 021.1
	Total liabilities		10 150.7	454.4	10 605.1
	Additions to non-current assets		1 276.7	29.7	1 306.4

	*	Direct deliveries are issues to franchisees directly by Group suppliers facilitated through the Group’s supply chain, these are not included in revenue on the statement of comprehensive income.
	**	Inter-segment revenue previously disclosed of R95.6 million has been removed as this was actual intra-segment revenue within the Africa segment.
	***	Segment external turnover presented previously inappropriately included direct deliveries of R695.4 million under the Africa segment. This amount was not included in the total external turnover and therefore resulted in the South Africa segment external turnover being understated. The prior year segment external turnover has been restated to reflect the correct segmentation between Africa and South Africa.

	Pick n Pay Holdings Group		South   Africa   Total	Africa   Rm	Total   operations   Rm
	2014
	Total segment revenue		60 925.9	3 241.5	64 167.4
	External revenue		60 925.9	2 736.0	63 661.9
	Direct deliveries*		—	505.5	505.5
	Segment external turnover		60 381.0	2 736.0	63 117.0
	Profit before tax		690.5	140.4	830.9
	Other information
	Statement of comprehensive income
	Interest received		40.1	4.2	44.3
	Interest paid		143.5	0.4	143.9
	Depreciation and amortisation		923.1	25.3	948.4
	Impairment loss on intangible assets		104.1	—	104.1
	Share of associate’s income		—	32.0	32.0
	Statement of financial position
	Total assets		12 995.6	1 109.0	14 104.6
	Total liabilities		11 070.3	337.9	11 408.2
	Additions to non-current assets		1 233.8	26.2	1 260.0
	2013
	Total segment revenue**		57 776.6	2 577.3	60 353.9
	External revenue		57 776.6	1 881.9	59 658.5
	Direct deliveries*		—	695.4	695.4
	Segment external turnover***		57 389.4	1 881.9	59 271.3
	Profit/(loss) before tax		714.3	92.7	807.0
	Other information
	Statement of comprehensive income
	Interest received		40.0	2.8	42.8
	Interest paid		131.3	—	131.3
	Depreciation and amortisation		881.4	14.1	895.5
	Share of associate’s income		—	23.4	23.4
	Statement of financial position
	Total assets		12 504.7	516.8	13 021.5
	Total liabilities		10 156.6	454.4	10 610.7
	Additions to non-current assets		1 276.7	29.7	1 306.4

	*	Direct deliveries are issues to franchisees directly by Group suppliers facilitated through the Group’s supply chain, these are not included in revenue on the statement of comprehensive income.
	**	Inter-segment revenue previously disclosed of R95.6 million has been removed as this was actual intra-segment revenue within the Africa segment.
	***	Segment external turnover presented previously inappropriately included direct deliveries of R695.4 million under the Africa segment. This amount was not included in the total external turnover and therefore resulted in the South Africa segment external turnover being understated. The prior year segment external turnover has been restated to reflect the correct segmentation between Africa and South Africa.