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Notes to the financial information for the period ended 3 March 2013

 

1.   BASIS OF PREPARATION AND ACCOUNTING POLICIES    
   The summarised consolidated financial statements for the period ended 3 March 2013 have been prepared in accordance with IAS 34 and International Financial Reporting Standards (IFRS), the requirements of the South African Companies Act, No 71 of 2008, as amended, and in compliance with the Listings Requirements of the JSE. The summarised consolidated statements does not include all the information required by IFRS for full annual financial statements and should be read in conjunction with the 2013 Integrated Annual Report. The accounting policies and methods of computation applied are consistent with those applied in the previous annual financial statements, except for the change in financial period cut-off date as disclosed in note 2 below. These results have been audited by KPMG Inc., whose unqualified report is available for inspection at the registered office of the Company. These financial statements have been prepared by the Finance Division under the supervision of the Chief Finance Officer, Mr Bakar Jakoet CA(SA).  
2.   CHANGE IN FINANCIAL PERIOD CUT-OFF DATE    
   During the financial period under review the Group adopted a 52-week financial reporting calendar for all future financial periods. This change will align financial reporting with Group operational structures and will improve comparative reporting to both internal and external stakeholders.  
   As a result, the 2013 annual financial period ended on 3 March 2013 compared to 29 February 2012 in the comparative period. The additional trading days included in the 2013 result had the following estimated impact on the consolidated financial statements.  
         Rm  
   Statement of comprehensive income        
   Turnover      479.6  
   Net profit after tax      28.0  
   Statement of financial position        
   Trade and other payables      1 158.7  
   Trade and other receivables      (99.5) 
   Cash and cash equivalents      (1 059.2) 
   Net working capital      —  
3.   RELATED PARTIES        
   During the period, certain companies within the Group entered into transactions with each other. These intra-group transactions are eliminated on consolidation. For further information please refer to note 27 of the 2013 Integrated Annual Report.  
4.   DISCONTINUED OPERATION      
   In September 2011, the Group sold its Australian business, Franklins, to Metcash Limited for R1.2 billion, net of fees. Franklins is disclosed as a discontinued operation in the prior period.  
5.   SHARE CAPITAL        
      2013  
Rm  
2012  
Rm  
   Authorised        
   800 000 000 ordinary shares of 1.25 cents each   10.0   10.0  
   Issued        
   480 397 321 ordinary shares of 1.25 cents each   6.0   6.0  
      COMPANY  
      000’s   000’s  
   The number of shares in issue at end of period is made up as follows:        
   Treasury shares held in the share trust   2 046.6   2 482.2  
   Shares held outside the Group   478 350.7   477 915.1  
   Total shares in issue at end of period   480 397.3   480 397.3  
   Under a general authority, 24 million of the unissued shares remain under the control of the directors until the next annual general meeting (5% of the issued share capital of the Company).  
   In addition to the general authority above, 63.9 million unissued shares (13.3% of issued shares) remain under the control of the directors to implement the terms and provisions of the Pick n Pay 1997 Share Option Scheme.  
   The holders of ordinary shares are entitled to receive dividends as declared and are entitled to one vote per share at meetings of the Company.  
   Directors’ interest in shares        
      2013   2012  
      %   %  
   Beneficial   1.0   1.3  
   Non-beneficial   27.5   27.6  
      28.5   28.9  
   The directors’ interest in shares is their effective direct shareholding in the Company (excluding treasury shares) and their effective indirect shareholding through Pick n Pay Holdings Limited (excluding treasury shares).  
6.   OPERATING SEGMENTS  
      South  
Africa  
Rm  
Africa  
Rm  
Total  
continuing  
operations  
Rm  
Discon-  
tinued  
operation  
Australia  
Rm  
Total  
opera-  
tions  
Rm  
   2013                 
   Total revenue   57 776.6   2 672.9   60 449.5   —   60 449.5  
   External revenue   57 776.6   1 881.9   59 658.5   —   59 658.5  
   Direct deliveries*   —   695.4   695.4   —   695.4  
   Inter-segment revenue   —   95.6   95.6   —   95.6  
   External turnover   56 694.0   2 577.3   59 271.3   —   59 271.3  
   Profit before tax   716.2   92.7   808.9   —   808.9  
   Other information                 
   Statement of comprehensive income                 
   Interest income   42.8   —   42.8   —   42.8  
   Interest expense   131.3   —   131.3   —   131.3  
   Depreciation and amortisation   881.4   14.1   895.5   —   895.5  
   Share of associates’ income   —   23.4   23.4   —   23.4  
   Statement of financial position                 
   Total assets   12 504.3   516.8   13 021.1   —   13 021.1  
   Total liabilities   10 150.7   454.4   10 605.1   —   10 605.1  
      South  
Africa  
Rm  
Africa  
Rm  
Total  
continuing  
operations  
Rm  
Discon-  
tinued  
operation  
Australia  
Rm  
Total  
opera-  
tions  
Rm  
   2012                 
   Total revenue   54 284.1   2 009.9   56 294.0   3 389.3   59 683.3  
   External revenue   54 284.1   1 350.3   55 634.4   3 389.3   59 023.7  
   Direct deliveries*   —   604.7   604.7   —   604.7  
   Inter-segment revenue   —   54.9   54.9   —   54.9  
   External turnover   53 375.5   1 955.0   55 330.5   3 389.2   58 719.7  
   Profit/(loss) before tax   1 120.3   49.7   1 170.0   (87.2)  1 082.8  
   Other information                 
   Statement of comprehensive income                 
   Interest income   39.5   —   39.5   0.2   39.7  
   Interest expense   135.1   —   135.1   6.0   141.1  
   Depreciation and amortisation   800.1   8.0   808.1   —   808.1  
   Share of associate’s loss   —   (1.9)  (1.9)  —   (1.9) 
   Profit on sale of Franklins (after tax)  —   —   —   438.4   438.4  
   Statement of financial position                 
   Total assets   11 377.8   440.5   11 818.3   —   11 818.3  
   Total liabilities   9 004.9   409.3   9 414.2   —   9 414.2  
7.   HEADLINE EARNINGS RECONCILIATION  
      2013  
Rm  
2012  
Rm  
   Basic earnings (profit for the period)  550.6   1 113.5  
   Continuing operations   550.6   762.3  
   Discontinued operation   —   351.2  
   Adjustments (net of tax):        
   Continuing operations   (18.4)  5.5  
   (Profit)/loss on sale of property, equipment and vehicles and intangible assets   (18.4)  5.5  
   Discontinued operation   —   (437.6) 
   Loss on sale of property, equipment and vehicles and intangible assets   —    0.8  
   Profit on sale of discontinued operation   —   (438.4) 
   Headline earnings   532.2   681.4  
   Continuing operations   532.2   767.8  
   Discontinued operation   —   (86.4)