OMNICANE Rising South · activities are located mainly at Mon Trésor near SSR International...

OM

NIC

ANE INTEG

RATED REPORT

2018

TheRisingSouth

Every morning, the sun rises to the beginning of a promising day.

Likewise, the South too rises to the prosperous future ahead;

the dawn of a brighter tomorrow with Omnicane.

the South too rises to the prosperous future ahead;

Dear Stakeholder,

The Board of Directors is pleased to present the Integrated Report of Omnicane Limited for the year ended December 31, 2018.

Didier MAIGROT Jacques M. D’UNIENVILLE, GOSKCHAIRMAN CHIEF EXECUTIVE OFFICER

About our Report

01 / About OmnicaneOmnicane at a GlanceOperating StructureBusiness LocationsSnapshots

02 / Operating ContextValue Creation ProcessFinancial & Operational DataStakeholder Analysis & Engagement

03 / Strategy & LeadershipChairman’s LetterBoard of DirectorsChief Executive Officer’s ReportKey Executives

04 / Performance & OutlookEnergyAgricultureSugar Milling – FactorySugar Milling – RefineryBioethanol DistilleryLogisticsHoliday Inn Mon TrésorProperty Development

05 / Key CapitalsFinancial CapitalManufactured CapitalNatural Capital Social & Relationship CapitalHuman CapitalIntellectual Capital

5

68

101214

16182021

2426283034

363840424648505254

60647172818591

06 / Risk ManagementRisk Governance & Methodology

07 / Corporate GovernanceStatement of CompliancePrinciple 1: Governance StructurePrinciple 2: The Structure of the Board & its CommitteesPrinciple 3: Directors’ Appointment ProceduresPrinciple 4: Directors’ Duties, Remuneration & PerformancePrinciple 5: Risk Governance & Internal ControlPrinciple 6: Reporting with IntegrityPrinciple 7: AuditPrinciple 8: Relations with Shareholders & Other Key StakeholdersKey Executives’ ProfilesStatutory DisclosuresCertificate of Company SecretaryStatement of Directors’ Responsibilities

08 / Consolidated Financial StatementsIndependent Auditors’ ReportStatements of Profit or Loss & Other Comprehensive IncomeStatements of Financial PositionStatements of Changes in EquityStatements of Cash FlowsNotes to the Financial Statements

09 / AnnexesAnnex 1: Compliance Assessment – Code of Corporate Governance 2016Annex 2: GRI Content IndexAnnex 3: SGS Certificate – External AssuranceAnnex 4: AdministrationAnnex 5: Proxy Form

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Contents

About our ReportScope, Boundary and Reporting CycleOmnicane Limited’s Integrated Report 2018 provides material information relating to our strategy and business model, operating context, material risks, stakeholder interests, performance, prospects and governance. Unless otherwise stated, all performance data relates to the 12-month period ended December 31, 2018. Key events including CSR activities have been updated until April 2019 to include the latest major happenings. There were also no significant changes in the organisation and its supply chain.

Reporting Principles

Omnicane has applied the principles contained in the International Financial Reporting Standards (IFRS), the Mauritian Code of Corporate Governance 2016, and the Stock Exchange of Mauritius Listing Rules. This report has been prepared in accordance with the GRI Standards: Core option. The International <IR> Framework of the International Integrated Reporting Council (IIRC) has also been used as reference.

Materiality Process

This report focuses on those matters that we see as being most material to our capacity to create value, and to deliver on our vision and mission, as assessed in discussion with representatives of Omnicane’s executive team and subsequently signed off by the Board. Our approach to managing these material matters is reflected in our strategic objectives. These objectives have been identified based on an assessment of how we create value, the impact of the external operating context on value creation, the material interests of our stakeholders, and the principal risks facing the Group. A detailed materiality and stakeholder engagement exercise for the GRI reporting was last conducted in 2015 and is available on Omnicane’s website at http://www.omnicane.com/materiality-report-2015.

Cross-Referencing with GRI StandardsThe content of this Integrated Report has been cross-referenced with respect to the different disclosures of the GRI Standards, for example, when reporting on GHG emissions, it has been cross-referenced .

External Audit and Assurance

An independent audit of the Group’s annual financial statements was performed by BDO & Co. The full Integrated Report has been externally verified and assured by SGS (Mauritius) Ltd.

Forward-Looking StatementsThis report contains certain forward-looking statements with respect to Omnicane’s financial condition, results, operations and businesses. These statements and forecasts involve risk and uncertainty as they relate to events and depend on circumstances that will occur in the future.

Link with Sustainable Development GoalsOmnicane has linked 14 out of the 17 Sustainable Development Goals related to its operations and activities in this report. SDG icons indicate the relevant sections that support the goals.

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5OMNICANE INTEGRATED REPORT 20184 OMNICANE INTEGRATED REPORT 2018

AboutOmnicane

01

6 OMNICANE INTEGRATED REPORT 2018 7OMNICANE INTEGRATED REPORT 2018

Omnicaneat a Glance

Financial

Operational

Others

914,009 tonnesSugarcanecrushed

4.2 billionTurnover (Rs)

6.17Loss per share (Rs)

NilDividend per share (Rs)

196,097 tonnesSugarcaneharvested

75,797 tonnesRefined sugar produced

24.4 million litresBioethanol produced

402 millionNet loss after tax (Rs)

326 millionNet loss before tax (Rs)

52.1% Gearing

666,201tonnesMaterials transported

670GWhElectricity exportedto the grid

1,396employees

2,140shareholders

20%Shareholdingin Real Good Food plc

184hectaresArea of land for Smart City Phase 1

01 / About Omnicane

20%Shareholdingin KISCOL


100%

100%

100%

100%

100%

FAWInvestmentLimited

The RealGood FoodCompanyPlc

ThermalValorisationCo. Ltd

Agri-Huband CompanyLimited

MAREFMon TrésorInvestments 1Limited

Trade ParkMon TrésorLtd

KwaleInternationalSugar Co. Ltd

Coal Terminal(Management)Co. Ltd

Mon TrésorDevelopment& TrainingCenter Ltd

Mon TrésorSmart CityLtd

Mon TrésorStudio Operations &Management Ltd

Mon TrésorStudio PropertyLtd

Mon TrésorStudio HoldingsLimited

Mon TrésorResidencesPhase 1Ltd

Mon TrésorSmart CityManagementLtd

OmnicaneTreasuryManagementLtd

OmnicaneMillingHoldings(Mon Trésor)Limited

OmnicaneHeat andPowerServicesLtd

OmnicaneEthanolHoldingsLtd

OmnicaneInternationalInvestmentCo. Ltd

OmnicaneAfricaInvestmentLtd

OmnicaneHydroEnergyLimited

OmnicaneBritanniaWind FarmOperationsLtd

OmnicaneWindEnergyLtd

OmnicaneThermal EnergyHoldings(St Aubin) Limited

OmnicaneHoldings(La Baraque)Thermal Energy Limited

OmnicaneMillingHoldings(Britannia Highlands)Limited

OmnicaneBioethanolOperationsLtd

100% 100% 70.25%

100%

OmnicaneHoldingsLimited

Others29.75%(National PensionsFund – 10.08%)

OmnicaneEthanolProductionLtd

80% 80% 51%

10%

10%15%

15%

15% 15%

10%

10%

100% 100%

19.76%

100%

100%

100%

100%

100%

100%

51%

25%

100%

100%

100% 100%

20%

100%

100%

100%60%

100%

16.85% 83.15%

100%

20%

15%60%

65%

50% 60%

100%

17.35% 40.72%

23.37%

100%

100%

100% 100%

100%

Copesud(Mauritius)Ltée

FlorealLimited

RefadRwandaLtd

Mon TrésorBusinessGateway Phase 1Ltd

Mon TrésorRetailLtd

OmnicaneSugarTradingLtd

OmnicaneLimited

OmnicaneLogisticOperationsLimited

OmnicaneThermal EnergyOperations(La Baraque) Limited

OmnicaneAgriculturalOperationsLimited

OmnicaneMillingOperationsLimited

OmnicaneManagement& ConsultancyLimited

AirportHotelLimited

BlueportInvestmentLtd

OmnicaneThermal EnergyOperations(St Aubin) Limited

MorningsideManagementLtd

OmnicaneFoundation

OperatingStructure

01 / About Omnicane

102-7


Local Operations

Cane Growing

Sugar Milling Energy Logistics Hospitality Land

Development

Mon Trésor • • •Britannia • • •Highlands •Benares •La Baraque • •St Aubin •

Market Presence

Omnicane’s main location of operations is in the South of Mauritius. The industrial cluster at La Baraque comprises a modern sugar factory, a sugar refinery, bagasse-coal cogeneration power plant, a bioethanol distillery and a Carbon Burn-Out unit. The cluster approach is also of strategic importance when it comes to maximising revenues, minimising costs, proximity to main sources of raw materials and transport links. Omnicane’s property development activities are located mainly at Mon Trésor near SSR International Airport and includes a smart city development project based on the Work Live Play approach. The Group is present in Kenya through Kwale International Sugar Company Limited (KISCOL) where it has a 20% equity stake and a joint management contract. In Rwanda, Omnicane is currently building a 5 MW hydro-electric power plant, of which 2 MW has already been commissioned. In the UK, the Group has a 20% stake in Real Good Food (RGF) which is a manufacturer of sugar paste, marzipan and low-calorie health bars.

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01 / About Omnicane

BusinessLocations

United Kingdom

Mauritius

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RwandaKenya


Snapshots01 / About Omnicane

February 2018 – Results-based Leadership training

March 2018 – 50th Independence Day celebration at La Baraque

April 2018 – Visit of Hon. Mahen Kumar Seeruttun, Minister of Agro Industry and Food Security at La Baraque

December 2018 – End of crop season prayer ceremony at La Baraque

February 2019 – Visit of Mozambican delegation at La Baraque cluster

March 2019 – First aid training for employees at Omnicane House

March 2019 – Visit of the President of the Republic of Madagascar, H.E. Mr Andry N. Rajoelina and his delegation

April 2019 – Visit of the Kenyan delegation at La Baraque cluster

April 2019 – Participation in sugar promotion workshop in Dubai

November 2018 – Relocation of Omnicane headquarters at Mon Trésor Business Gateway

November 2018 – RBL Projects Award Ceremony

December 2018 – Team building for Omnicane employees

September 2018 – Participation in African Property Investment (API) Summit in South Africa

May 2018 – Visit of Bonsucro Technical Week delegates at La Baraque cluster

October 2018 – Sugar Marketing Strategy Workshop at Essentia Training Centre

October 2018 – Start of Fighting Diabetes at Work two-year programme


OperatingContext

02


Value CreationProcess

OurMaterialRisks

1. Exchange rate fluctuations2. Fluctuations in commodity prices3. Decreasing land under cane cultivation

4. Shortage of raw materials5. Fire outbreak

6. Information security and cyber resilience7. Changes in legal and other requirements8. Non-compliance with environmental legislation

9. Injuries at work10. Property oversupply on the market

Vision To be a leading force in sustainable developmentthrough constant innovation Mission We strive to make the utmost sustainable use of resources

at our disposal, for the benefit of all

DiversifyGeographicalBase

AchieveFinancialObjectives

Rebalancethe Gearing

EnhanceValue ofLand Bank

SustainableGrowth

VerticalIntegration ofCane Industry

StrategicPartnerships

Strengtheningof Business

StrategicManagement

Procurement

Accounting,Finance &Treasury

Legal &Compliance

Sustainability& RiskManagement

Information &CommunicationTechnology

InternalAudit

HumanResourceManagement

Marketing

CorporateSecretary

PropertyProjectDevelopment,Sales &Marketing

IndustrialProjectDevelopment &Management

Strategicobjectives

Capitalinputs Support

services

Financial Capital• Debt & equity financing• Retained earnings reinvested

Manufactured Capital• Office equipment• Agricultural equipment• 1 sugar factory• 1 sugar refinery• 2 power plants• 1 distillery• 1 Carbon Burn-Out Unit• 221 fleet of vehicles

Human Capital• 1,396 skilled and experienced staff and workers

Natural Capital• Sugarcane, raw sugar, molasses, bagasse, coal, fly & bottom ash• Energy, fuel & water• Land for agricultural & property development

Intellectual Capital• Company culture & skills• Brand & reputation• Digital transformation

Social & Relationship Capital• Positive employee relations• Constructive engagement with local communities• Collaboration with suppliers & strategic partners

Capitaloutputs

Financial Capital• Turnover: Rs 4.2 billion• Loss for the year: Rs 402.3 million• EBITDA: Rs 791 million• Depreciation: Rs 612 million

Manufactured Capital• Investment in property, plant & equipment: Rs 636 million

Human Capital• Expenditure as salaries, wages and other benefits: Rs 701 million

Natural Capital• Plantation white sugar produced: 94,256 tonnes• Refined sugar produced: 75,797 tonnes• Electricity produced: 758 GWh• Bioethanol produced: 24.4 million litres• Total energy consumed: 6,046,442 GJ• Total water consumed: 7,644,522 m3

• Total environmental expenditure: Rs 37.9 million

Intellectual Capital• Digital transformation expenditure: Rs 4.5 million• Brand development expenditure: Rs 22.2 million

Social & Relationship Capital• Total amount spent by Omnicane Foundation: Rs 4.1 million• Total spending on local and foreign suppliers: Rs 2.9 billion

GrowthDrivers

ResponsibilityInnovationIntegritySustainabilityEfficiency

Values

Omnicane

Cane &

Sugar

Energy

BioethanolProperty &Hospitality

Logistics

02 / Operating Context


StakeholderAnalysis& Engagement

MED

IUM

LOW

Consult Collaborate Invoke

Government/Regulatory bodies

Board of Directors

Shareholders

Employees

Banks/FinancialInstitutions

Trade Unions

Suppliers/Contractors

Clients

Local communities

Industryorganisations

HIG

H

LOW MEDIUM HIGH

Stakeholderimpact onOmnicane

Omnicane’s impact onstakeholder


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We identify our key stakeholders based on their influence on our business decision-making processes. This assessment enables us to categorise these relationships as either ‘collaborate’, ‘invoke’ or ‘consult’. While we engage with all stakeholders, we have identified our key stakeholders as those with whom we need to consult and, as such, have developed goals for each of them.

Financial & Operational Data


Financial data 2018 2017 2016

(Loss)/earnings per share (Rs) (6.17) (6.28) 1.97

Dividend per share (Rs) - 2.00 2.00

Return on equity (%) (4.17) (3.86) 1.51

Net Asset Value per share (Rs) 148.19 163.63 130.82

Gearing (%) 52.07 48.65 54.59

Effective tax rate (%) N/A N/A 11.36

No of Ordinary Shares (‘000) 67,012 67,012 67,012

Operational data – Growing 2018 2017 2016

Area harvested (hectares) 2,394 2,419 2,575

Cane production (tonnes) 196,097 209,257 229,961

Sugar produced (tonnes) 20,293 20,230 24,826

Sugar accrued as planters (tonnes) 15,829 15,779 19,364

Sugar yield per hectare (tonnes) 8.48 8.36 9.64

Sugar price (Rs) 10,050 13,350 15,550

Area harvested mechanically/total harvest area (%) 75.0 75.0 71.2

Milling 2018 2017 2016

Sugar refined and sold (tonnes) 80,134 183,289 179,189

Sugar accrued (@ 98.5 pol) as miller (tonnes) 20,671 21,969 25,943

Sugar produced by the mills (tonnes) 94,256 100,914 118,480

Cane crushed (tonnes) 914,009 1,054,689 1,163,482

Sugar price (Rs) 8,800 13,350 15,550

Energy 2018 2017 2016

Total electricity exported (GWh) 670 745 720

From coal (GWh) 571 633 594

From bagasse (GWh) 99 112 126

Distillery 2018 2017 2016

Molasses used (tonnes) 85,134 60,136 70,693

Bioethanol produced (million litres) 24.4 17.9 20.4


StakeholderAnalysis& Engagement (cont’d)


Our stakeholders

Main expectations How we interact with our stakeholders Frequency

1 Shareholders Increase shareholders’ value

• Quarterly financial statements• Annual Integrated Reports• Omnicane website (www.omnicane.com)

Quarterly & yearly

2 Clients Quality products or services

• Regular meetings• Client audits• Implementation of: - ISO 9001:2015 Quality Management System - ISO 22000:2018 Food Safety Management System - BRC Food Standards - IHG Brand Standards

As and when required

3 Board of Directors

Sound financial business models and corporate governance practices

• Annual update of financial business model (independently validated) • Quarterly Board meetings • Board Committee meetings

Quarterly

4 Employees Shared culture, attitudes and job security

• Notice boards/Signage• Email• Memos• Website• Meetings

Daily/As and when required

5 Government/ Regulatory Bodies

Compliance with laws and other requirements

• Close collaboration and meetings with Government and parastatal bodies• Presence of a legal department


6 Suppliers/ Contractors

Effective delivery of products or services

• Meetings• Supplier evaluations


7 Trade Unions Harmonious employer-employee relations

• Meetings As and when required

Our stakeholders

Main expectations How we interact with our stakeholders Frequency

8 Local Communities

Social responsibility & engagement

• Newsletter• Meetings• Sponsoring community-based projects

Quarterly/ As and when required

9 Industry Associations

Latest developments in the sugarcane industry

• Meetings with industry associations as member As and when required

10 Banks & Financial Institutions

Fulfill financial commitments

• Meetings As and when required

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Strategy & Leadership

03


Dear Stakeholder,

On behalf of the Board of Directors, I am pleased to present Omnicane Limited’s Integrated Report for the financial year ended December 2018. This report presents the achievements as well as the challenges for our main business segments – cane and sugar, energy, bioethanol, logistics, property and hospitality. As a responsible corporate entity, our objective is to create sustained value for our stakeholders through judicious management of our key resources. The transparency, accountability, innovation and sustainability we seek to demonstrate throughout our operations make us live up to our vision, mission and values.

Operating Context 2018 has been a tough year for Omnicane as financial results were adversely affected by the sugar price reduction to a historical low of Rs 8,800 per metric tonne (ex-Syndicate price). As mentioned last year, our main sugar market, the European Union, recorded surplus production that drove prices further down during the year under review. These difficult market conditions impacted directly on the demand for Mauritian white sugar and as a result, orders and production at the refinery were significantly lower this year. Last year, we called for bold measures from the authorities to ensure the financial viability and sustainability of the cane industry. Though some measures were taken in 2018, the major ones, proposed by the Joint Technical Committee, are still pending. It is important to reiterate again here, that we are now operating in an open and very competitive market and this industry cannot continue to operate within the current rigid framework.

The financial support currently required by the sugar operations, together with the development of projects by other entities of the Group, has triggered an update of our financial business strategy with a particular focus on cash-flow streaming. A five-year financial business plan has been validated by an independent firm and was presented to the Board in March 2019. Some key identified initiatives therein are currently being implemented, with a particular focus on delivering improved operating results and on the disposal of certain non-core assets.

We have also embarked on an overall review of our property development roll-out with Jones Lang LaSalle (JLL), an investment management and professional services company, specialising in real estate. This exercise will be completed in June 2019 and will give us an updated macro view of the property market locally and also a road map for the implementation of the different developments in Phase 1 of the Mon Trésor Smart City project.

Sustainability Being at the heart of our vision and mission, sustainability plays a critical role in our business ventures to ensure that our endeavours are socially inclusive and environmentally compatible whilst achieving the required economic returns. Despite the current difficult times, I am pleased to report that proactive steps are being taken by the cane and sugar segment to adopt international standards that will substantiate the sustainability of our sugar supply chain. Such initiatives will undoubtedly give a competitive edge to Mauritian sugar

in an open market driven by a growing demand for sustainably sourced commodities.

Good Governance, Risk Management and Business Continuity In line with the guidelines of the Mauritian Code of Corporate Governance 2016, Omnicane’s Board of Directors affirms its commitment to ensure sound corporate governance practices. In 2018, we updated and formalised the Board Charter which sets out how the Board of Directors and Top Management interact to promote efficient, transparent and ethical functioning of the Group.

The investment made for developing a robust and efficient Enterprise Risk Management framework has started to bear encouraging results as we are proactively managing our risks, assessing controls and systematically conducting risk reviews. We have also established a Business Continuity Plan to better protect operations at the La Baraque cluster and Holiday Inn Mon Trésor from business interruptions, property damages, financial impacts, and loss of lives that natural disasters or man-made events may cause.

Outlook There are encouraging signs of improvement in the EU and world sugar market conditions and we are expecting this to translate into a higher price in 2019. In addition, various initiatives are being taken by Omnicane, including advanced research in developing new products to tap into more remunerative markets. We are confident that with the pricing and cost containment measures proposed, which are currently being reviewed by the World Bank, the cane industry can recover and continue to play a vital role in the country’s economy. The cane industry is indeed, with its multi-functional role, the sector with the highest economic multiplier effect as identified by the latest MCB research (Lokal is beautiful).

The Group now has different business segments which ensure greater resilience. In addition, the 18-month RBL (Results-Based Leadership) programme, which was completed in December 2018, has provided the Management with the required tools to deliver on the targets set for a return to profitability.

Appreciation I wish to thank our shareholders for their continued confidence in the business despite the challenges faced during the 2018 financial year. I would also like to take the opportunity to thank my colleagues on the Board for their support and wise counsel. Our Management team, led by Jacques M. d’Unienville, has demonstrated commitment and ethical leadership in pursuing the Group strategy – for which I am grateful. I am confident that Omnicane will continue in its quest to deliver value for all its stakeholders in the future.

Didier MAIGROTCHAIRMAN

03 / Strategy & Leadership

Chairman’sLetter

As a responsible corporate entity, our objective is to create sustained value for our stakeholders through judicious management of our key resources.”

““


Board ofDirectors


Didier MAIGROTNON-EXECUTIVE CHAIRPERSON

Preetam BOODHUNNON-EXECUTIVE DIRECTOR

Bertrand THEVENAUNON-EXECUTIVE DIRECTOR

Jacques M. D’UNIENVILLE, GOSKCHIEF EXECUTIVE OFFICER & EXECUTIVE DIRECTOR

Valentine LAGESSE NON-EXECUTIVE DIRECTOR

Pierre M. D’UNIENVILLENON-EXECUTIVE DIRECTOR

Nelson MIRTHILCHIEF FINANCE OFFICER & EXECUTIVE DIRECTOR

Marc HEIN, SC, GOSK NON-EXECUTIVE DIRECTOR

Jimmy TONG SAM NON-EXECUTIVE DIRECTOR

Koosiram CONHYE NON-EXECUTIVE DIRECTOR

Thierry MERVEN NON-EXECUTIVE DIRECTOR


Group Performance Review 2018 has been a very challenging year for our operations. The Group was not only affected by the sugar segment’s performance, with the sugar price hitting a low of Rs 8,800 (ex-syndicate price), but had also to face an exceptional breakdown on one of the electricity production lines at La Baraque, following a lightning strike. On a positive note, the Holiday Inn Mon Trésor improved its operating profit and the sale of morcellement land plots boosted profit on the property development side. We have also made good progress in the Mon Trésor Smart City with the completion of the first office building within the Mon Trésor Business Gateway. The residential development project is now on track and we are aiming to start construction before the end of 2019.

During the year under review, the Group posted a loss of Rs 6.17 per share compared to Rs 6.28 in 2017. That being said, we are taking all necessary steps both on revenue-enhancing and cost-cutting measures to ensure that the Group’s performance will improve in 2019.

Energy Cluster The energy cluster’s operating profit was down by Rs 95 million in 2018. The segment’s bottom line was indeed negatively impacted by a lightning strike which occurred in February 2018, during a thunderstorm, damaging an alternator on line 2 of the La Baraque power plant. This equipment was airlifted to South Africa, for repairs and was successfully recommissioned in June 2018.

The total cost of this incident was Rs 227 million, out of which Rs 177 million is receivable from insurance.

On the other hand, the St Aubin power plant recorded a satisfactory performance with a profit after tax of Rs 98.2 million (2017 – Rs 96.0 million) which is in line with forecasts.

The other components of the energy cluster comprise a small energy plant and a Carbon Burn-Out (CBO) unit which turns coal ashes into energy and a cement additive. The CBO was still in a ramping up phase in 2018, producing energy and a good quality end-product (cement additive) as per expectations. Sugar Segment

As already mentioned, the effect of surplus sugar stocks both on the world and European markets kept the sugar price under pressure. The situation persisted during the whole year and made it difficult for the Mauritius Sugar Syndicate (MSS) to secure sales contracts at remunerative prices on the EU market. The impact was twofold for the Group, first the sugar price hit a historical low of Rs 8,800 (ex-Syndicate) and second, the volume of refined sugar produced by Omnicane was reduced to 80,134 tonnes (2017 – 183,289 tonnes).

The authorities reiterated its support to the industry in the form of an additional payment of Rs 1,250 per tonne of sugar through the Sugar Insurance Fund Board (SIFB).


Chief Executive Officer’s Report

102-14

201-4

We are taking all necessary steps both on revenue-enhancing and cost-cutting measures to ensure that the Group’s performance will improve in 2019.”

““


Chief ExecutiveOfficer’s Report (cont’d)


Unfortunately, this measure was paid to planters only and not to millers. This deprived the Group of an amount of Rs 25.8 million, which we consider due to Omnicane Milling, being an important contributor to the SIFB. Negotiations are still under way with the SIFB to ensure that Omnicane Milling receives its share of this measure.

As a result of all the above, the sugar and ethanol segment posted an operating loss of Rs 365.8 million (2017: Rs 318.2 million). Property Cluster Smart City Development Business Gateway We have made significant progress in the first phase of our Smart City project in 2018. The first office building was completed within the Mon Trésor Business Gateway (MTBG) precinct, situated next to the Holiday Inn Mon Trésor. The main tenant is Omnicane, which has moved its Head Office from Port Louis to Mon Trésor to be closer to its industrial operations and be at the epicentre of its Smart City. Other tenants have made reservations for space in the new building. This office building has obtained a 4-star Green Star building rating and we are now looking forward to an exciting, buzzing networking activity around that new business node.

Residential In respect of the residential development, we have re-defined the first phase of our offering to be better aligned with market expectations. Our Marketing and Development Departments have been reinforced to ensure that we have the right competencies to deliver on our targets.

Other Property Developments We have other property developments situated outside the Smart City, which concerns mainly the construction and sale of residential morcellements. In 2018, The Fairview project at Mare d’Albert, comprising 432 plots over 57 arpents, was successfully completed, underpinning the foreseen demand for residential products in that region. Three other projects are in the pipeline – Greenview in Mare d’Albert, La Colline in Plaine Magnien and the parceling of the old Highlands sugar mill site.

Sustainability Achievements With the global business environment becoming significantly more competitive and volatile, sustainability has rapidly moved up our business agenda, ensuring we have a business model that is economically viable, socially

inclusive and environmentally sound. Omnicane is not only creating value by valorising sugarcane co-products but has also applied BREEAM Communities principles in the development of its Mon Trésor Smart City.

Also, our different stakeholders, including our customers, are showing growing interest in understanding and tracking the environmental and social impacts of their supply chain. In this context, the refinery has successfully obtained the VIVE certification in November 2018. This certification will enable the refinery to source sustainable, imported raw sugars and to supply refined sugar as per the requirements of our most demanding clients. The agricultural and milling operations are also on the right path towards compliance with Bonsucro requirements and we aspire to achieve certification to these standards by early September 2019. I would like to put on record the efforts made by our agricultural team to reduce their herbicide application rate with the support of the Mauritius Sugar Industry Research Institute. Human Capital Development We acknowledge that our human capital is vital for the success of the Company and as such we are motivated to provide our employees with a performance-based culture with the right skills, capabilities, morale and productivity to achieve our growth aspirations. During the year under review, we have successfully completed the Results-Based Leadership training programme initiated for 51 staff from different entities of the Group. There were 9 specific projects assigned to different Management groups, each one with a purpose and a measurable target to achieve. We were pleased to see the commitment and creativity shown by these teams to deliver on their targets. To recall, the main objective of this programme was to develop and uphold a leadership culture based on accountability, sustainability and innovation. This, we believe, will help us achieve our organisational goals in an effective and efficient manner. Our Main Priorities With the challenging year faced by the Group in 2018, particularly in the sugar segment, the main focus of Management has been to ensure a proper allocation of financial resources and to consolidate and optimise the current operations of the Group.

To have more visibility on the way forward, we have updated our five-year financial business plan which was presented and approved by the Board of Directors, after validation of same by an independent consulting firm. This document has also been shared with our main

stakeholders including our financiers. Our aim is to target to turn around the sugar segment, optimise the energy operations and ensure cash generation from the property cluster. In addition, we have earmarked some non-core assets for disposal to reduce our debt level. Outlook – 2019 Sugar SegmentThe main beet sugar producers on the European market have started to reduce their field production to draw down the sugar surplus on the continent. They have also announced the closure of various sugar factories in Germany and France. By December 2018 and early 2019, we started to see signs of recovery, particularly on the EU market, with sugar being traded at a spot price that was approximately Euro 100 higher than at the same time last year. This should definitely translate into the MSS obtaining a higher price for Mauritian sugar in 2019. This trend has also positively impacted the white sugar production and, as a result, the MSS has resumed importing raw sugar for refining in Mauritius. A shipment of about 41,000 tonnes has already been imported and another one should be finalised soon, which will increase refined sugar produced by Omnicane to an estimated amount of 180,000 tonnes in 2019.

On the local side, three factors will contribute to improving our results:

First, the 80% tax imposed from 2019 on imported sugar in Mauritius should also have a positive impact on the sugar price paid by MSS to producers. Second, the shutdown of the Medine sugar mill after the 2018 harvest, which has been approved by the authorities. Omnicane should receive about 42% of the cane previously crushed by Medine, provided transportation costs are covered by a mechanism to be agreed with the authorities. We are negotiating for the transport cost to be paid through an increase in the purchase rate for electricity produced from Medine’s sugarcane bagasse. We are proposing the payment of energy produced from bagasse at the same rate as that of coal-produced power. The rationale being that without bagasse, the country would have to use coal as a substitute to meet its base electricity needs. We are confident that a win-win solution will be achieved in the coming weeks.

The third factor is the adjustment to the compensation for Omnicane for ‘event’ years which were not previously declared by the SIFB following a fact-finding committee decision.

As a result of the above, we should see a significant rise in the sugar segment’s results for 2019.

Energy ClusterIn 2019, we expect a marked improvement in results for the energy segment with a return to normal operations of La Baraque power plant for a full year. The St Aubin power plant should also deliver a normal year’s performance. As a result, profit after tax of some Rs 330 million is expected in 2019 (2018 – Rs 226.9 million) from this segment.

Property ClusterOn the residential side, we target the commencement of construction of phase 1 of the different units mentioned previously, as soon as we reach the financial break-even. In this respect, we have launched an aggressive marketing campaign known as ‘Move South’, which should contribute positively to this end. Another important project which is earmarked to start in 2019 is a business park near the Holiday Inn Mon Trésor which is very well situated for office space.

With regard to projects outside the Smart City, we are launching another residential morcellement of about 1,000 land plots at Mare d’Albert, for which we have already obtained the necessary permits.

Profits on the above developments will only be recognised at the end of these projects following the adoption of IFRS 15 in 2018.

Acknowledgement In closing, I wish to thank the Chairman, my colleagues on the Omnicane Board and executive teams for their guidance and support over the year. I am also extremely grateful to our employees across the Group for their invaluable contribution. I continue to be impressed by their energy and passion.

Jacques M. D’UNIENVILLE, GOSKCHIEF EXECUTIVE OFFICER

102-14102-14


1 Jacques M. D’UNIENVILLE, GOSK Chief Executive Officer

2 Nelson MIRTHIL Chief Finance Officer

3 Fabien DE GUARDIA DE PONTE Logistic Operations Manager

4 Christophe BARBÈS-POUGNET Head of Legal Services & Project Finance

5 Jean-François LOUMEAU Group Project & Development Executive

6 Oudesh SEEBARUTH Head of Corporate Finance & Treasury

7 Joël BRUNEAU Head of Property Development

8 Hahmid SEELARBOKUS Group Human Resources Manager

9 Kevin PADIACHY Industrial Development Manager – Africa Desk

10 Rajiv RAMLUGON Group Chief Sustainability Officer

11 Navin MOHUN Internal Audit Manager

12 Lindsay DAVY Operations Executive – Refinery

13 Jean-Michel GÉRARD General Manager – Power Plant La Baraque

14 Jérôme JAËN Group Chief Operations Officer

15 Jean-Paul TOSTÉE Sales & Development Executive

16 Avinash DOOKHUN IT Manager

17 Jean-Laurent ASTIER General Manager – Holiday Inn Mon Trésor

18 Maurice REGNARD Chief Procurement Officer

KeyExecutives


13 1415 16 17

19

4 53

6

2

78

18

1

20

9 10

21

11 12

Missing from photo:

19 Jean-Pierre ROUILLARD General Manager – Distillery

20 Rudley LUTCHMANEN Group Finance Manager

21 Eddie AH-CHAM Company Secretary

Peter HOUGHSugar Development Executive

Jean-Luc CABOCHEOperations Executive – Milling

Frédéric ROBERTPower Plant Manager – St Aubin

François Vitry AUDIBERTChief Operations Officer – Agriculture


Performance & Outlook

04


Energy04 / Performance & Outlook

Strategic ObjectiveOur two power plants at La Baraque and St Aubin respectively operate with the main objective of providing end users with sufficient, consistent and uninterrupted energy supply. As Independent Power Producers, our power plants accounted for 21% of the total electricity production in Mauritius over the review period.

Year under ReviewIn 2018, the two main power plants at La Baraque and St Aubin produced a total of 758 GWh of electricity (2017: 864 GWh) and exported 670 GWh (2017: 745 GWh) to the national grid, out of which 17.3% were from bagasse. This drop in electricity production and export was due to reduced operations at the La Baraque power plant owing to a lightning strike which damaged an alternator on line 2 of the power plant. A detailed breakdown of our electricity production and export from coal and bagasse is given below:

From coal (GWh) From bagasse (GWh)

Electricity produced 2018 2017 2016 2018 2017 2016

90 MW power plant – La Baraque 381 444 405 131 143 162

35 MW power plant – St Aubin 246 255.7 251 - - -

Electricity exported

90 MW power plant – La Baraque 345 401 365 99 112 126

35 MW power plant – St Aubin 226 233 229 - - -

Carbon Burn-Out UnitOur Carbon Burn-Out (CBO) unit is capable of treating coal ash generated by Omnicane’s power plants at La Baraque and St Aubin as well as that of Terragen at Belle Vue. It consists of a furnace for the thermal processing of coal ashes into energy and a valuable low carbon footprint additive for use in the cement industry. The CBO plant started its commercial operations in 2018 but had some teething problems which resulted in a below-capacity performance. These were fully addressed in November of the same year after which it became fully operational. During the year under review, our CBO unit delivered 56,937 tonnes of low-pressure steam and 1,561 MWh of electricity for supply to the distillery. Some 11,369 tonnes of cement additive were also produced during the year.

OutlookIn view of favourable operating conditions, our two main power plants are expected to deliver uninterrupted supply of energy to the cluster and respect the 8,000 hours per year supply of electricity to the national grid in 2019. Another focus for the forthcoming year will also be to ensure full-year operation of our Carbon Burn-Out unit with minimal stoppage.

Some 11,369 tonnes of cement additive were produced during the year.”

Some 11,369 tonnes“


Agriculture04 / Performance & Outlook

Strategic ObjectiveWith the decreasing area of cultivated land, the strategic objective of our agricultural operations is to maximise cane and sugar yields at Britannia and Mon Trésor through good agricultural practices. We are also committed to implement sound sustainability practices in our fields in order to align with customer and regulatory requirements. With 196,097 tonnes of sugarcane harvested from 2,394 hectares of land in 2018, we represent some 8.5% of the island’s total sugarcane production.

Year under ReviewSugarcaneIn 2018, out of the 2,568 hectares (2017: 2,633 hectares) of land under cane cultivation, 2,394 hectares (2017: 2,419 hectares) were harvested in the Britannia and Mon Trésor regions. The total production of sugarcane was 196,097 tonnes (2017: 209,257 tonnes), a 6.3% decrease compared to the previous year. This was mainly due to heavy rainfall during the intercrop season. Fortunately, climatic conditions over the crop period were favourable to sucrose accumulation. An extraction rate of 10.33% was achieved in 2018, resulting in a sugar yield of 9.3 tonnes/hectare for Britannia and 8.0 tonnes/hectare for Mon Trésor.

With its rich climate, relatively high soil fertility and favourable plant growth conditions, Britannia has been the best performer island-wide in the last few years in terms of average cane yield and sugar yield. In 2018, the region once again topped the list as a large planter with 85,374 tonnes of sugarcane (2017: 94,642 tonnes) from 941 hectares of land. This represent a cane yield of 90.7 tonnes/hectare (2017: 98.7 tonnes/hectare) and a sugar yield of 9.3 tonnes/hectare (2017: 9.4 tonnes/hectare).

The Mon Trésor region produced 110,723 tonnes of sugarcane (2017: 114,615 tonnes) from 1,453 hectares of land, equivalent to a cane yield of 76.2 tonnes/hectare (2017: 78.5 tonnes/hectare) and a sugar yield of 8.0 tonnes/hectare (2017: 7.8 tonnes/hectare).

It should also be noted that 174,600 tonnes of sugarcane, representing 75% of the total crop, were harvested mechanically in 2018 (same as 2017).

PotatoIn 2018, the potato harvest amounted to 2,398 tonnes (2017: 1,105 tonnes) from 75 hectares of cultivated land. It should be noted that our potato production in 2017 was exceptionally low due to bacterial wilt.

Herbicide Application RateThe agricultural sections at Britannia and Mon Trésor have been applying the new dosages of herbicides recommended by the MSIRI since September 2018. From January to December 2018, the combined herbicide application rate for both sections was 4.8 kg active ingredient per hectare (2017: 6.8 kg active ingredient per hectare) which complies with the Bonsucro targeted objective of < 5 kg active ingredient per hectare.

OutlookFor the 2019 crop, our agricultural operations are expected to harvest some 210,000 tonnes of sugarcane to produce around 21,718 tonnes of sugar. The potato harvest is estimated to be around 2,400 tonnes, subject to good weather conditions.

Cane yield (tonne/hectare) Sugar yield (tonne/hectare)

2018 2017 2016 2018 2017 2016

Britannia 90.7 98.7 100.2 9.3 9.5 10.08

Mon Trésor 76.2 78.5 82.5 8.0 7.8 8.61

Island Average 70.4 79.8 73.8 7.3 7.7 7.5

Britannia has been the best performer island-wide in terms of average cane yield and sugar yield in the last few years.”

Britannia has been the best performer“


Sugar Milling Factory

04 / Performance & Outlook

Strategic ObjectiveThe main strategic objective of our ISO 22000 certified sugar factory is to continue being a reliable supplier of plantation white sugar to our refinery, of molasses to our bioethanol distillery and of bagasse to our cogeneration power plant. We will achieve this by optimising operational efficiency while reducing production costs. Along the same line, in 2018 the sugar factory worked towards implementation of the ISO 50001 Energy Management System and successfully achieved certification in February 2019. With rising customer expectations for sustainable supply, the sugar factory is now aiming for Bonsucro certification by early September 2019.

Year under ReviewDuring the year under review, our sugar factory crushed a total of 914,009 tonnes of sugarcane (2017: 1,054,689 tonnes) supplied by 12 corporate planters and 3,514 small planters. It produced 94,256 tonnes of plantation white sugar (2017: 100,914 tonnes) as main product.

Co-products derived included 34,112 tonnes of molasses (2017: 38,223 tonnes) and 313,668 tonnes of bagasse (2017: 360,841 tonnes). The total sugar accrued to Omnicane Milling Operations Limited amounted to 20,671 tonnes in 2018 (2017: 21,972 tonnes).

Due to adverse weather conditions affecting cane supply, the factory’s crushing rate in 2018 averaged 7,380 tonnes/day compared to 7,791 tonnes/day in 2017. The sucrose percentage in the sugarcane was higher at 11.82, compared to 11.06 in 2017. Total mill losses in the year under review were slightly higher at 1.66% against 1.64% in 2017 and the extraction rate for 2018 ended at 10.21 (2017: 9.48). The Reduced Overall Recovery (ROR), which indicates the overall performance of the factory, was higher at 86.6 in 2018 compared to 86.4 in 2017. For comparison, the average ROR for the four sugar factories in Mauritius stood at 86.7 in 2018.

With rising customer expectations for sustainable supply, the sugar factory is now aiming for Bonsucro certification by early September 2019.”

With rising customer expectations for sustainable supply,

“


Omnicane MillingSugar Accrued (@98.5 Pol) as Miller (Tonnes)

2018 2017 2016

20,67121,969

25,94326,000

19,500

13,000

6,500

0

Tonnes

Sugar Milling Factory (cont’d)


Cane Management ServiceIn 2018, the Planters’ Advisory Department helped some 87 small planters in the Southern region maintain a total of 129 hectares of land under sugarcane cultivation, resulting in a harvest volume of 6,549 tonnes. In addition, the department replanted some 15 hectares of land and completed the cultivation of 12 hectares of abandoned land at Deux Bras, under the Small Planters Regrouping Project. This project is financed by the Government through the Mauritius Cane Industry Authority (MCIA). It benefitted 14 land owners in the region.

The Planters’ Advisory Department has regular meetings with the small planters, with a total of 6 meetings in 2018 concerning pre-crop for harvest, closure of weighbridge, clean cane campaign, cane management service and sustainability.

Furthermore, a training session on the importance of sustaining cane cultivation was organised during the year for the benefit of small planters in the Southern region. A small harvester demonstration was also held at Anse Jonchée with the collaboration of MCIA and CEAL. Widely used in Reunion Island, this equipment can benefit local small planters as well.

OutlookFor the 2019 crop, a total of 900,000 tonnes of sugarcane are estimated to be crushed to produce some 91,000 tonnes of plantation white sugar. We are also aiming for the implementation of the following standards: FSSC 22000, ISO 9001:2015 Quality Management System and Bonsucro Production and Chain of Custody Standards. The Planters’ Advisory Department will initiate hiring of local contractors utilising foreign labourers so as to cater for the scarcity of labour.

2018 2017 2016

94,256

100,914

118,480

Omnicane MillingTotal Sugar Produced (@98.5 Pol) as Miller (Tonnes)

120,000

112,500

105,000

97,500

90,000

Tonnes

Omnicane MillingSucrose % Cane

2018 2017 2016

11.82

11.06

11.60

12.00

11.50

11.00

10.50

10.00

%

Omnicane MillingROR Factory v/s Island Average

2018 2017 2016

86.7

86.686.6

86.4

86.6

86.7

86.6

86.5

86.4

86.3

ROR

ROR Island

ROR Factory

86.7


Sugar Milling Refinery


Strategic ObjectiveWith a BRC A grade certification, our sugar refinery’s strategic objective is to produce high-quality refined sugar to meet our customers’ requirements. As a means to realise global presence on key markets and world competitiveness, we are aiming at product and packaging flexibility to better satisfy our customers’ needs.

Year under ReviewIn 2018, our refinery produced 75,797 tonnes (2017: 184,243 tonnes) of refined white sugar of standard EEC II, EEC 1 and bottler’s grade. This significant 58.9% decrease was largely due to reduced demand on the market owing to a huge global surplus of sugar and lower market price following changes in the EU sugar regime. This situation led to a severe drop in the sale of Mauritius’ refined white sugar in 2018. Despite low production, we continued to supply refined sugar as per client requirements either in 25-tonne bulk containers or in 50-kg and 1-tonne bags. It should be noted that 52% of the production was supplied in 50-kg bags.

An amount of 4,337 tonnes of refined sugar from 2017 were carried forward to the 2018 stock, and a total of 80,134 tonnes of refined sugar were delivered to the different clients of the refinery. 8,633 tonnes of refined white sugar have been stocked in 50-kg and 1-tonne bags in our newly constructed 4,300 m2 warehouse, for delivery in 2019.

Despite the increase in relevant taxes, only 10,428 tonnes of refined sugar were sold on the local market representing a 50% decrease compared to last year. As far as our retail brand, Kara is concerned, some 297 tonnes of brown and refined white sugar were sold in 500 g, 1 kg and 2 kg packaging on the local and regional markets.

Process ImprovementWith the help of De Smet consultants, our refinery implemented a major process improvement that increased its annual production capacity to 260,000 tonnes. The new operating processes were successfully commissioned in July 2018. With the additional capacity and improved efficiencies, the refinery will be better prepared to take advantage of any growth prospects in the sugar market.

Sustainable Supply ChainOur refinery was successfully audited against the Claim Level (Step 2) of the VIVE programme in November 2018. The main pillars of this audit were governance, facility management including health and safety, environment, traceability, mass balance, transport and storage. The VIVE certification will enable the refinery to produce sustainably sourced refined sugar from imported non-originating sugar thus satisfying the requirements of our client – Czarnikow.

OutlookIn 2019, the refinery is expected to produce 180,000 tonnes of refined white sugar. The implementation of an automatic bagging plant for packing of sugar in 25 kg and 50 kg bags will also be realised in order to offer more options to customers.

With the help of De Smet consultants, our refinery implemented a major process improvement that increased its annual production capacity to 260,000 tonnes.”

“

increased its annual production capacity


BioethanolDistillery


Strategic ObjectiveWith its double ISO 22000 and ISO 9001:2015 certifications, our distillery’s strategic objective is to produce and deliver high-quality bioethanol to its clients, whilst ensuring a stable and sufficient supply of molasses.

Year under ReviewWith a full year’s operation in 2018, the distillery produced 24.4 million litres of bioethanol (2017: 17.9 million litres) from 85,134 tonnes of molasses (2017: 60,136 tonnes). This marked the best operating performance since its inception in 2013, arising from adequate availability of molasses throughout the year. The by-products obtained during the year were as follows: 87,269 tonnes of Concentrated Molasses Solids (CMS) (2017: 55,378 tonnes) used as fertiliser and 3,082 tonnes of carbon dioxide (2017: 1,986 tonnes) used in the beverage industry.

During the year under review, our major clients were: the Southern and Eastern African market for neutral bioethanol, Island Renewable Fertilizers for CMS and Gaz Carbonique for food grade carbon dioxide.

OutlookIn 2019, the distillery is expected to produce some 19-20 million litres of bioethanol subject to availability of molasses.

Year Molasses used(tonnes)

Bioethanol produced(litres)

Neutral bioethanol produced (litres)

CMS produced(tonnes)

2018 85,134 24,398,785 22,383,624 87,269

2017 60,136 17,944,047 16,481,038 55,378

2016 70,693 20,416,896 18,590,528 66,375

“This marked the best operating performance since its inception in 2013, arising from adequate availability of molasses throughout the year.”

best operating performance


Logistics04 / Performance & Outlook

Strategic ObjectiveThe strategic objective of our logistics operations is to optimise transport services for sister companies and external clients whilst reducing operating costs. We are thus committed to making use of an adequate and well-maintained fleet of vehicles.

Year under ReviewIn 2018, Omnicane Logistics transported a total of 666,201 tonnes (2017: 840,974 tonnes) of materials for sister companies and for some external clients with an optimised fleet of trucks and trailers. This indicates a net drop of 20.8% in the total amount of materials transported compared to last year. This decrease is explained by a reduction in the transport of main materials such as sugarcane, coal and sugar. It was partly mitigated by additional transport of coal ash from Terragen and St Aubin power plants and transport of cement additive from La Baraque to Port Louis related to the operation of the Carbon Burn-Out plant. It should be noted that regular maintenance of our vehicles is carried out to ensure they operate efficiently and in compliance with relevant provisions of the Road Traffic Regulations. The company also provided new services to Lafarge for the transport of cement, hereby optimising the use of its existing equipment.

OutlookFor the 2019 crop season, Omnicane Logistics has already secured additional transport of 80,000 tonnes of chopped sugarcane from Mon Désert. We have also made provision for transporting additional cement additive in 2019 from the Carbon Burn-Out unit by ordering a third specialised trailer. In addition, two sets of equipment have been ordered to transport ash and CMS fertiliser. The success of ongoing negotiations with another large market player may generate additional transport business as from September 2019.

Year Sugar(tonnes)

Coal(litres)

Sugarcane(tonnes)

Other products (tonnes)

Total(tonnes)

2018 119,107 312,748 183,005 51,341 666,201

2017 282,011 322,325 217,163 19,475 840,974

2016 280,384 303,267 183,717 20,090 787,458

For the 2019 crop season, Omnicane Logistics has already secured additional transport of 80,000 tonnes of chopped sugarcane from Mon Désert.”

For the 2019 crop season,“



Holiday Inn Mon TrésorStrategic ObjectiveThe strategic objective of Holiday Inn Mon Trésor, is to exceed guest expectations by providing an affordable, warm and enriching experience and to be a trustworthy business meeting venue in the Southern region of Mauritius.

Year under ReviewIn 2018, our room occupancy rate decreased slightly to 57.8% compared to 61.6% in 2017. As a means to enhance our service delivery, our Average Daily Rate (ADR) rose by 11.4% from Rs 3,238 to Rs 3,605. This had a positive effect on our revenue, which increased by 3.3% to Rs 158 million (2017: Rs 153 million). Our focus on meetings and conferences has been a success, namely with the booking of more than 80 rooms for a single conference during the year. Our hotel also successfully passed the IHG Brand Standard audit and achieved the hotel performance metrics on cleanliness, condition, brand safety and brand standard.

Furthermore, our IHG revenue management system was replaced by IHG Concerto, which is a free and more sophisticated tool to merge reservation and revenue management systems. As a single seamless hotel management tool, IHG Concerto will provide our guests with better assistance through direct access to our website. In 2018, we renewed our contracts with some major airline companies such as KLM Royal Dutch Airlines and Corsair. There is also a firm partnership from two chartered flights providers, Thomson and Thomas Cook. Our development and training centre, Essentia, continues to provide conferencing and training facilities including conference logistics and MQA approved training courses to corporate clients.

OutlookThe mission for progressing in the upcoming years is to position Holiday Inn Mon Trésor among the best IHG hotels in the AMEA (Asia, Middle East and Africa) region.

The mission for progressing in the upcoming years is to position Holiday Inn Mon Trésor among the best IHG hotels in the AMEA (Asia, Middle East and Africa) region.”

The mission for progressing in the upcoming years “


Property Development


Strategic ObjectiveThe strategic objective of our property development consists in “building to sell and building to lease” a range of profitable, harmonious and sustainable properties on selected land over the next 15 years, in support of Omnicane’s overall business objectives.

Year under Review

Mon Trésor Business GatewayOur Smart City initiative has seen the completion of the first phase of the Mon Trésor Business Gateway (MTBG) precinct with the collaboration of Eris Properties and Momentum. The MTBG building has been accredited as a 4-star Green Star building on design and construction by the Green Building Council of South Africa. The fitting out of the first office blocks was completed in November 2018, after which Omnicane moved its Head Office from Port Louis to Mon Trésor. This relocation brought us closer to our operations, at the epicentre of the Mon Trésor Smart City. Other tenants have also booked office space in the new building.

Mon Trésor Freeport Zone & Business ParkAs a result of the recent changes in the Freeport Act, the progress of the Freeport development has slowed down with fewer allowable activities and increased tax rates. Nevertheless, the site’s proximity to the airport cargo zone makes it a prime location. Our business park development is progressing satisfactorily with infrastructure over 17 hectares to service 50 commercial and light industrial plots from early 2020. This BREEAM Communities certified development will also be supported by a “cahier des charges”.

Mon Trésor ResidencesThe first phase of our residential programme continued its market penetration with an enhanced internal development and marketing & sales team. Roadshows will also be organised in South Africa and Reunion Island. We have applied for an EIA licence for both the built-up units and residential morcellement and expect to receive the Building and Land Use Permit (BLUP) for this master plan in mid-2019. A marketing campaign with the tagline #MoveSouth will take place in April 2019 to promote our project and its Southern authenticity.

Land Development ProjectsThe Fairview morcellement project met the budgeted goals, proving the continued local market interest to invest and live in the South. We have thus pipelined two additional projects in the same area, La Colline and Greenview. The former is a residential project including 121 plots over 14 acres in Plaine Magnien and the latter, adjoining our Fairview project, comprises 980 plots over 118 acres. We have also received the permits and started the sale of a morcellement with 44 plots over 8 acres situated at the old Highlands factory yard.

Studio Babelsberg at Mon TrésorAnother major achievement in 2018 was the completion of the drafting of an Information Memorandum for the Berlin-based Babelsberg studio project at Mon Trésor. Following several road-shows with local investors and banks, Omnicane received positive responses for potential investment and we are expecting a financial close-out by June 2019. The construction of the first Babelsberg studios, production offices and workshops at Mon Trésor is scheduled for mid-2020.

OutlookThe second phase of the construction of about 7,500 m² at our MTBG will start in 2019. The sale of all the 16 employee housing units at Britannia is also expected to be completed in 2019. Moreover, the construction of our commercial centre is scheduled to start in the second half of 2019. This retail offering will suit the residents of Mon Trésor, local communities, airport staff and tourists.

“The MTBG building has been accredited as a 4-star Green Star building on design and construction by the Green Building Council of South Africa.”

4-star Green Star building


LIVEWORKPLAY

The Southern Smar t C i ty


Nathalie JOBMon Trésor Property Client

L I V I N G I N T H E S O U T H


MOVE SOUTHA g r e e n e r f u t u r e a w a i t s

NOW SELLING APARTMENTS • TOWNHOUSES • VILLAS m o n t r e s o r . m u

T: +230 650 8036

MOVE SOUTHG i v e b r e a t h i n g s p a c e t o l i f e

At Mon Trésor, a harmoniously balanced lifestyle awaits, where everything you need is just around the corner – ideal to enjoy work and life. A green coastal haven complemented by a modern infrastructure where you finally feel fulfilled, surrounded by the sounds of nature.

Invest now | Embrace a new life at Mon Trésor.

NOW SELLING A PA R T M E N T S • T O W N H O U S E S • V I L L A S

C O N V E N I E N C E S H O P P I N G | S C H O O L S | O F F I C E S | B E A C H C L U B | B E A C H B O U L E V A R D | S P O R T S C O M P L E X

m o n t r e s o r . m uT: +230 650 8036


MOVE SOUTHT h e b e a c h i s s o c l o s e





m o n t r e s o r . m uT: +230 650 8036


MOVE SOUTHD i v e i n t o a v i b r a n t f u t u r e





m o n t r e s o r . m uT: +230 650 8036


On my first visit to Mon Trésor, I was attracted by the beauty of the site, the energy of the surroundings, access to the beach, and Omnicane’s commitment to preserve the environment. Furthermore, the residential offer was financially attractive.”

On my first visit to Mon Trésor, I was attracted by the beauty of the site

“

“The choice to settle in the South is also to experience the authenticity that we have somewhat lost in other regions. It is the ideal location to live, for holidays and provides easy access to the airport.”


KeyCapitals

05


05 / Key Capitals

Source: Forum for the future

Key Capitals

IntellectualCapital

Economic

Social

Environmental

FinancialCapital

ManufacturedCapital

HumanCapital

Social & RelationshipCapital

Natural Capital

The perceived value of a business is no longer solely tied to its physical assets. All organisations depend on several forms of capital for their value creation and market viability. Thus, our understanding of value has expanded to include multiple capitals, broadly categorised as Financial, Manufactured, Intellectual, Social, Human, and Natural. We consider that effectively managing and reporting on these capitals is an investment in our reputation and long-term sustainability. The Group Chief Sustainability Officer is responsible for managing environmental and social topics while the Chief Finance Officer is responsible for managing economic topics.

Both the sustainability requirements of the GRI Standards and the key capitals as required by the International Integrated Reporting Council (IIRC) can best be integrated and summarised by the illustration below:

102-20


05 / Key Capitals

3,000

2,250

1,500

750

0

Rs million

Sugar & Ethanol

2018

1,440

2,596

166 43

2017

1,634

2,700

161 43

2016

2,0832,262

129 28

Energy Hospitality Property

2018 Rs’000

2017 Rs’000

2016 Rs’000

Direct Economic Value GeneratedGroup turnover 4,245,171 4,539,150 4,502,280Plus income from investments 156,149 121,576 111,000Less production costs (2,708,142) (2,675,728) (2,448,857)Total direct economic value generated 1,693,178 1,984,998 2,164,423

Wealth DistributedTo employees as salaries, wages and other benefits 701,571 734,075 713,602To lenders of capital as interest 635,555 643,354 701,919To shareholders as dividend 117,225 134,025 134,025To Government as taxation 20,950 26,565 26,613To communities as corporate social responsibility 1,778 3,453 4,401Total wealth distributed 1,477,079 1,541,472 1,580,560

Wealth ReinvestedRetained (loss)/profit (395,873) (155,832) 2,522Depreciation 611,972 599,358 581,341Total wealth reinvested 216,099 443,526 583,863

Value Added Statement

Borrowings Profile

9,000

6,750

4,500

2,250

0

Rs million

2018

Short-term borrowings Long-term borrowings Bank overdraft

2017 2016

1,7541,356

2,764

1,422 1,4301,927

7,830 8,006

6,383

Economic Performance

Financial Strategy: Strategic PlanWith the sugar segment being under pressure in 2018 on the back of low sugar prices and the energy segment performing at a lower level, the objective on the financial side was to focus on the Group’s cash flow. The priority was indeed to ensure that the sugar cluster had enough financial resources to continue its operations whilst other segments of the Group achieve their business plans. One of the main financial measures taken during the year was the gearing up of the holding company of St Aubin energy power plant for Rs 268 million.

Looking forward, the updated five-year plan provides us a road-map for the future, with KPI’s to be achieved not only on the operational side but also in terms of disposal of some non-core assets. The gearing up of other subsidiaries to alleviate the cash flow of Omnicane Limited, which remains the investment arm of the Group, shall remain an important objective for the forthcoming financial year.

Against the above operational backdrop, the Group’s borrowings were slightly higher at Rs 11.0 billion compared to Rs 10.8 billion in 2017.

Financial Capital 201-1

103-1 103-2 103-3

Adoption of IFRS 9 and 15 Impact of IFRS 15:The Group adopted IFRS 9 and 15 during the financial year under review and in that respect, prior year opening balances were restated. These include mainly receivables and loan balances for which an expected credit loss provision have been raised. Furthermore, our reporting segments have been reclassified as sugar and ethanol, energy, hospitality and property to be in line with Management’s internal reporting practices. The main impact of IFRS 15 – Revenue from contracts with customers was on the change in revenue recognition criteria for which our property segment was mostly affected. Previously, the Group accounted for property revenue progressively as and when non-refundable deposits were received from customers and risks and benefits partially transferred. Under IFRS 15, this can only be recognised upon completion of all obligations towards the customer i.e. upon transfer of ownership and control.

Turnover by Segment


FinancialCapital (cont’d)

05 / Key Capitals

Growing & Milling – Cane Production to Sugar Accrued

1,400,000

1,200,000

1,000,000

800,000

600,000

400,000

200,000

0

26,00025,00024,00023,00022,00021,00020,00019,00018,00017,00016,00015,00014,00013,00012,00011,00010,0009,0008,0007,000

Growing (tonnes)

2018 2017 2016

Milling (tonnes) Sugar accrued

196,

097

209,

257

229,

961

1,163

,482

1,05

4,68

9

914,

006

15,829

20,671

15,779

21,969

19,364

25,894

2,000

1,500

1,000

500

0

Rs million

Growing, Milling & Refinery

2018 2017 2016

Ethanol & Others

1,277

1,577

1,828

448375

529

Operating Cost

800

600

400

200

0

GWh

Bagasse

2018 2017 2016

Coal

99112 126

594634

571

Energy Production

Sugar Segment – Operating Profit 2018 Rs million

2017 (Restated) Rs million

2016 Rs million

Sugarcane growing (262.1) (293.1) (154.5)Cane milling & sugar refining (181.3) (64.1) (56.7)Ethanol distillery 86.2 54.6 79.0Investment & others (allocated to sugar and ethanol cluster) (8.6) (15.7) (45.1)Total (365.8) (318.2) (177.3)

As already reported, the Group’s operating profit in 2018 was adversely affected by the fall in the sugar price paid by the Mauritius Sugar Syndicate (MSS). The segment posted operating losses of Rs 365.8 million (2017: Rs 318.2 million), which were Rs 47.6 million lower than results recorded in 2017. Upon closure of the financial year in December, the sugar price stood at Rs 8,800/tonne compared to Rs 13,350/tonne received in 2017.

The distillery posted a record production in 2018 which resulted in an increase of 57.9% in operating profits to Rs 86.2 million (2017: Rs 54.6 million). This was made possible due to a full year availability of molasses.

Operating Profit/(Loss)

Energy Segment – Operating Profit 2018 Rs million

2017 Rs million

2016 Rs million

Power plants 415.3 509.8 552.1REFAD Rwanda (0.5) (0.3) (51.8)Total 414.8 509.8 579.3

The energy cluster’s financial results were down by Rs 95 million in 2018. This was mainly due to the stoppage of line 2 of the La Baraque power plant following a lightning strike.

The total cost of this incident was Rs 227 million, out of which Rs 177 million is receivable from insurance.

On the other hand, the Saint Aubin power plant recorded a satisfactory performance with profit after tax of Rs 98.2 million (2017 – Rs 96.0 million) which is in line with expectations.

The Carbon Burn-Out plant started operating in 2018 but encountered teething problems which resulted in below capacity performance. These were fully addressed in November and the plant has since then been fully operational, producing steam which is sold to the cluster at La Baraque and exporting fly ash used as an additive by local cement producers.



05 / Key Capitals

Operating Profit by Cluster

EBITDA by Cluster

600

450

300

150

0

(150)

(300)

(450)

Rs million

2018 2017 2016

(365)(318)

(177)

(30) (23)

9

414

509 500

5 1

(25)

Sugar & Ethanol Energy Hospitality Property

900

800

700

600

500

400

300

200

100

0

(100)

Rs million

2018 2017 2016

52109

825

32 29 3

(30) (23)

9

737

821 845

Sugar & Ethanol Energy Hospitality Property

Property SegmentThe Property activity includes the performance of Mon Trésor Smart City Ltd (MTSC) reported separately as a segment. Some 184 hectares of land valued at Rs 2.8 billion were transferred to the Company in 2016 and sales refer to land disposed to respective developers within the boundary of the project. The segment recorded operating losses of Rs 30.8 million mainly due to deferred expenses previously borne by the holding company now being released in the Statement of Comprehensive Income by MTSC.

Omnicane no longer consolidates the results of Real Good Food plc as an associate company following dilution of its interest therein. The Group elected to present all movements in the fair value of the investment held in the UK-based group in other comprehensive income in line with the requirements of IFRS 9.

During the financial year under review, the Group impaired the investment held in its associate Kwale International Sugar Company Limited (KISCOL) by Rs 292 million to reflect its share of the net asset of the Kenya-based company. The associate could not resume its crop in the second half of 2018 mainly due to an accidental fire which affected the front end of the plant. An insurance claim is currently under process which shall compensate both for the repairs to the equipment as well as the resulting loss of revenue.

Other operating profit consists of profit realised from the sale of land outside the boundaries of Mon Trésor Smart City. This mainly relates to the sale of morcellement land realised by Omnicane Limited, now reclassified as other non-operating income.

Finance CostThe results from 2017 include a gain of Rs 95.6 million realised following the revaluation of the loan balance in KISCOL which did not recur in 2018. Finance cost was contained to Rs 632.3 million in 2018 compared to Rs 643.4 million in 2017 despite the increase in borrowings level during the year under review.

EarningsThe Group’s loss per share reached Rs 6.17 (2017: Rs 6.28) mainly due to the adverse results recorded both in the Sugar and Energy segments during the current financial year under review. The forthcoming year shall be more promising with slight increase being observed in the sugar price in the first quarter of 2019. The energy segment shall perform as expected in the forthcoming year and on the property side, the residential part of the Mon Trésor Smart City shall kick start in 2019.

Share of Profit/(Loss) of Associates 2018 Rs million

2017 Rs million

2016 Rs million

Real Good Food plc - 156.0 11.9KISCOL - - (9.1)Others (1.9) (0.1) 1.9Total (1.9) (156.0) 4.7

Other Non-Operating Income/(Expenses) 2018 Rs million

2017 Rs million

2016 Rs million

Profit/(loss) from disposal of land 128.3 (8.4) 248.5Land debtors written-off - (14.4) -Total 128.3 (22.8) 248.5



05 / Key Capitals

Net Debt

8,000

6,000

4,000

2,000

0

Rs million

Sugar & Ethanol

2018 2017 2016

Energy Hospitality

7,922

2,543

7,504

2,486

415

7,408

2,471

381346

05 / Key Capitals

ManufacturedCapital

Indirect Economic Impacts

Indirect economic impacts, while harder to quantify, include jobs affected indirectly by the operations, infrastructural development in the region where the Company operates and community development programmes. During the year under review, there have been no significant indirect economic impacts of the activities and operations.

103-1 103-2 103-3 203-1 203-2

Manufactured capital relates to the material goods and infrastructure needed to turn raw materials into a product and includes items such as buildings, transport networks, tools, machines and computers.

At Omnicane, we manage our diverse operating assets to the highest standards of performance, availability, and efficiency. In 2018, the Group continued to invest in the valorisation of its co-products, deploying new technologies and processes to optimise its operational performance. We also applied process re-engineering to upgrade the capability and efficiency of our refinery while reducing energy consumption. We have provided a modern and sustainable working environment at Mon Trésor Business Gateway (MTBG) by moving our headquarters there in October 2018.

Carbon Burn-Out TechnologyThe fly ash and bottom ash produced by the power plants at La Baraque and St Aubin were previously used to fill cavities in the soil and depressions in sugarcane fields. We remain committed to finding a viable long-term alternative, through research and development and have successfully implemented our Carbon Burn-Out (CBO) unit in January 2018. Using fluidised bed combustion technology, this unit burns extra carbon in the fly ash and bottom ash to produce a residual ash, used as additive in the cement industry. This process reduces the carbon content of the ashes from 20% to 5%. CBO tailors the combustion conditions to recover the wasted energy of the unburned carbon in the fly ash which is then used to supply part of the steam requirements of the cluster.

Green Star Building – Omnicane HouseThe Office Park at Mon Trésor is a Green Star-rated building spanning two blocks. Omnicane House, a flagship building housing the Group’s headquarters has been set up in one of the blocks. The MTBG has incorporated environmental and sustainable practices from design to construction and has specifically been designed to provide our employees with a conducive workplace while mitigating its impact on the environment.

Logistics – Double Trailer TrucksIn 2018, we have re-introduced the concept of double trailers trucks, each with a 25-tonne capacity, in order to optimise our logistics operations and achieve fuel and cost savings. This unique system in Mauritius allows the simultaneous transportation of a full container load of refined sugar and an empty container of coal on the outward trip to Port Louis and vice versa on the return trip to La Baraque.

Refinery – Process Re-EngineeringThe refinery’s upgrading project with De Smet consultants was completed and commissioned as from April 2018. Through this project, our refinery increased its annual capacity from 200,000 tonnes to 260,000 tonnes of refined white sugar while also achieving energy savings. With the additional capacity and improved efficiencies, the refinery will be better prepared to take advantage of any growth prospect in the sugar market.

New Warehousing FacilityIn 2018, our 4,300 m2 warehouse at La Baraque became fully operational for the storage of bagged raw and refined sugar. This warehouse is fully covered and offers protection against pests and bad weather conditions.

New Mud Filter at La BaraqueOmnicane’s refinery produces up to 1,500 tonnes of scum annually. This scum is obtained from the filtration of mud coming from the re-melted sugar clarification process. In 2018, the belt filter – the equipment ensuring this filtration was replaced by a press filter. This change of technology brought many improvements to the process including: a relatively drier scum for a better valorisation as natural fertiliser in the sugarcane fields, lower sugar losses in the scum, more reliable operation and lower maintenance costs.

Information TechnologyIn order to avoid disruption of IT services, more efforts, compliance and management are required regarding security. The IT Department ensures that appropriate technology is implemented to maintain confidentiality, integrity and availability of business-critical applications. Security systems include virus scanners, firewall systems, access controls at operating system and application levels, redundant systems as well as regular data backups. A budget for IT is allocated annually based on business needs for the financial year.

Statement of Cash Flows

0

(500)

(1,000)

(1,500)

(2,000)

(2,500)

(3,000)

Rs million

Opening/Closing Balance

Cash & cashequivalents2017

Operatingactivities

Netinterestpaid

Purchaseof PPE &intangibles

Net proceedsfrom sale ofland

Dividendpaid

Net proceedsfromborrowings

Cash & cashequivalents2018

Increase Decrease

(1,043)(1,203)

715

249 213

(484)

(646) (207)


NaturalCapital

05 / Key Capitals

Renewable Direct Materials

10,000,000

8,000,000

6,000,000

4,000,000

2,000,000

0

Tonnes

Sugarcane

2018 2017 2016

BagasseRaw sugarMolassesWood chipsWater91

4,00

9

313,

844

94,2

56

85,1

34

10.5

6

7,58

6.95

8

1,05

4,68

9

360,

042

100,

914

60,1

36

1,31

0

9,05

6,62

7

1,16

3,48

2

396,

282

118,

480

70,6

93

1,36

9

9,62

9,37

4

Natural Capital considers all the natural resources used to deliver our products and services, such as raw materials, water, energy and environmental management components.

Materials Management

Omnicane highly believes in the principles of circular economy, i.e., the rational management and value addition of raw materials entering our different business operations. Our renewable direct materials include sugarcane used in our sugar factory, raw sugar used in our refinery, bagasse used in our power plants, molasses used in our bioethanol distillery, and water used in our different process operations. Non-renewable input materials refer mainly to imported coal, which is used within our power plants as well as transportation fuel used in our logistics operations. The Integration Chart describes the flow of materials at the La Baraque cluster.

103-1 103-2 103-3 301-1

Cane

Milling

Refinery Food Grade CO2 Bioethanol Distillery

Coal Carbon Burn-Out

Construction/BuildingIndustry

Raw Sugar

Bagasse

Steam

CogenerationPower Plant Electricity

forNationalGrid

ElectricityMolasses

Bio-Fuel

Refined Sugar

Steam & Electricity

CMS Bio-Fertilisers Biogas* Vinasse

ElectricitySteam

Steam

Electricity

Coal Fly &Bottom Ash

Steam

Cement Additive

Elec

trici

tySt

eam

* The biogas project is still a project to be implemented, awaiting necessary approvals from authorities.

In 2018, the total amount of renewable direct materials used was 8,994,212 tonnes (2017: 10,633,718 tonnes) whereas the total amount of non-renewable direct materials used was 356,602 tonnes (2017: 409,740 tonnes). This decrease can be explained by a lower amount of sugarcane crushed in our sugar factory, resulting in less bagasse, and lower usage of woodchips by our Small Energy Plant due to reduced operations. Also, less coal was used in our power plants.

301-1

La Baraque Cluster Integration Chart


NaturalCapital (cont’d)

05 / Key Capitals

Indirect Non-Renewable Materials

3,300

3,000

2,700

2,400

2,100

1,800

1,500

1,200

900

600

300

0

Tonnes 30,000

25,000

20,000

15,000

10,000

5,000

0

Litres

2018 2017 2016

865.8

8.1

2.6

1,796

352.2

14.3

2.5

2,219

46615.8

2.6

2,537

22,45923,670 24,420

7,580

1,221 1,217 1,321

7,443 6,667

Pesticides (tonnes)

Herbicides (tonnes)

Fertilizers (tonnes)

Chemicals (tonnes)

Pesticides (litres)

Chemicals (litres)

Herbicides (litres)

Co-ProductsSome 821 tonnes of scum (2017: 1,267 tonnes) were produced by our sugar factory and distributed to small planters in the region for application as bio-fertiliser. On the energy side, some 100,717 tonnes of coal and bagasse ash (2017: 95,159 tonnes) were produced by our power plants.

Renewable Source/GJ 2018 2017 2016

Direct primary energy purchased - - -Plus direct primary energy produced 1,333,527 1,704,896 1,911,231Minus direct primary energy sold (354,797) (401,955) (452,683)Total direct energy consumption from renewable sources 978,730 1,302,941 1,458,548

Non-Renewable Source/GJ 2018 2017 2016

Direct primary energy purchased 100,561 70,994 68,676Plus direct primary energy produced 2,910,451 3,858,377 3,660,827Minus direct primary energy sold (2,056,699) (2,281,453) (2,140,470)Total direct energy consumption from renewable sources 5,067,712 1,647,918 1,589,032

Sugar Factory 2018 2017 2016

Specific steam consumption in kg/tonne of sugarcane crushed 373 414 395

Specific electricity consumption in KWh/tonne of sugarcane crushed 22.2 20.8 21.5

Refinery 2018 2017 2016

Specific steam consumption in kg/tonne of refined sugar produced 1.49 2.06 1.99

Specific electricity consumption in KWh/tonne of refined sugar produced 88.6 62 63.2

Distillery 2018 2017 2016

Specific steam consumption in kg/litre of bioethanol produced 5.6 4.9 5.1

Specific electricity consumption in KWh/litre of bioethanol produced 0.23 0.22 0.24

Energy Management

Omnicane recognises that developing a sound energy management strategy involves the smart use of renewable and non-renewable energy resources in our business operations. Our sugar factory was successfully certified to the ISO 50001 Energy Management System in 2019 while our sugar refinery continued to achieve energy savings through improved process re-engineering. Furthermore, with the coming into operation of our Carbon Burn-Out unit in 2018, we produced 1,561 MWh of electricity from the combustion of coal ashes recovered from our power plants for internal consumption. An analysis of our direct energy consumed from renewable and non-renewable sources demonstrates the following results:

103-1 103-2 103-3 302-1

Energy Efficiency

We put much emphasis on demand-side management and energy efficiency in our operations. For instance, our investments in energy-efficient equipment in the last few years have continued to bear fruit and we have achieved energy savings mainly in our sugar factory. However, the specific energy consumption for the refinery has increased due to reduced operations in 2018.

302-3 302-4

Non-Renewable Direct Materials

450,000400,000350,000300,000250,000200,000150,000100,00050,000

0

Tonnes

Coal

2018 2017 2016

Coal Ash

339,762

409,740382,183

0016,840

Non-renewable indirect materials include pesticides, herbicides, chemical fertilisers and industrial chemicals used in our operations and these totalled 2,692 tonnes and 31,005 litres in 2018 (2017: 2,588 tonnes and 32,330 litres). It should be noted that following the implementation of the Bonsucro Production Standard, less herbicides were used in the fields.

301-1

Renewable indirect materials consist of Concentrated Molasses Solids (CMS) and carbon dioxide. In 2018, 90,351 tonnes of renewable indirect materials (2017: 57,364 tonnes) were supplied.



05 / Key Capitals

Surface Water Consumption

Total Water Consumption (m3)

Tap Water Consumption

Thermal LB37%

Thermal SA21%

Agriculture22%

Distillery 7%

SugarFactory7% Refinery

6%

Milling48%

HolidayInn34%

Logistics5%

Agriculture6%

Thermal LB3%

Thermal SA4%

2018

2017

2016

7,644,522

9,114,159

9,679,358

Water Management

Water is an essential strategic resource for Omnicane’s operations. In 2018, the total surface water used was 4,666,768 m3 (2017: 5,587,198 m3) whereas the total amount of groundwater abstracted was 2,920,189 m3 (2017: 3,469,429 m3). As far as tap water consumption is concerned, this amounted to a total of 57,564 m3 in 2018 (2017: 55,532 m3). Overall, the Group’s water consumption has decreased by about 16.1% due to the following: strict monitoring in our sugar factory leading to reduced wastage, lower production levels in the refinery and La Baraque power plant. It should be noted that excess process water from milling operations and the distillery during harvest time is available for reuse in the irrigation of sugarcane fields. Moreover, we do not operate in water-stressed regions and our water usage does not compete with sources of domestic water supply. It should be noted that abstracted ground water is used in our agricultural operations for irrigation purposes.

103-1 103-2 103-3 303-1 303-2

Thermal – St Aubin

Coal as Fuel Concentration @ 15% Oxygen

Min Max EPA 1998 Standards Carbon dioxide (%) 4.8 5.3 None

Carbon monoxide (mg/m3) 9.0 22 1000

Sulphur dioxide (mg/m3) 328 568 2000

Oxides of nitrogen (mg/m3) 155 219 1000

Particulate matter load (mg/m3) 7.4 26 200

Thermal – La Baraque

Bagasse as Fuel Concentration @ 15% Oxygen


Carbon monoxide (mg/m3) 73 76 1000



Particulate matter load (mg/m3) 55 390 400

Coal as Fuel Concentration @ 15% Oxygen


Carbon monoxide (mg/m3) 8 23 1000



Particulate matter load (mg/m3) 7.5 12.4 200

Biodiversity Management

We are committed to the preservation and enhancement of biodiversity. Environmental impact assessments have concluded that our industrial operations at La Baraque and St Aubin are neither in nor adjacent to protected areas or areas of high biodiversity value. As far as the Mon Trésor Smart City project is concerned, ecologically sensitive or high biodiversity areas have been identified and appropriate measures will be taken to protect and enhance their value.

Emissions Management

Our power plants are equipped with Electrostatic Precipitators (ESPs) for flue gas treatment. Furthermore, ambient air quality monitoring and stack monitoring exercises at our power plants are carried out independently on a quarterly basis by the Air Pollution Monitoring Unit of the Mauritius Cane Industry Authority. Reports demonstrate that all parameters measured are compliant with the EPA 1998 Standards.

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103-1 103-2 103-3 305-7



05 / Key Capitals

Avoided CO2 Emissions

2018 2017 2016 Bagasse related electricity exported to national grid (MWh) 98,554 111,654 125,745 Avoided emissions from the burning of bagasse in tCO2e 100,229 113,552 127,883

Emission factor of bagasse = 0.775 kgCO2/kg (bagasse) = 1.017 tCO2/MWh (Source: 2006 IPCC Guidelines for National Greenhouse Gas Inventories)

Entity Volume of wastewater discharged, m3 (est) Destination

2018 2017 2016

Milling (Sugar Factory) clean water 3,678,032 2,989,319 2,292,679 Cane irrigation

Milling (Sugar Factory) effluent 38,178 59,371 107,130 Recirculated in the process

Milling (Refinery) effluent 12,722 157,522 98,645 Recirculated in the process during the crop season and sent to cane irrigation during the intercrop period

Thermal - La Baraque 508,609 487,923 415,076 Clarified through a decantation pond before reuse for cane irrigation

Thermal - St Aubin 289,707 299,213 294,542 Clarified through a decantation pond before canal disposal

Distillery 84,623 92,844 181,506 Recirculated in the sugar mill during the crop season. During the intercrop period, partly reused in distillery operations as well as for irrigation of cane fields

Holiday Inn Mon Trésor 14,187 12,893 10,506 Processed through a dedicated treatment plant and reused for irrigation of lawn

Effluent and Waste Management

The commitment for our waste management programme emerges from the Group Environmental Policy and the ‘zero waste’ approach, which places strong emphasis on the 3Rs (Reduce, Reuse and Recycle) principle. The table below shows the effluent generation and disposal in terms of volumes and destinations. It should be highlighted that the volume of water discharged from refinery operations decreased considerably by 92% due to process re-engineering. The volume of clean water discharged by La Baraque sugar factory increased by 23% due to a rise in storm water run-off as a result of heavy rainfall.

103-1 103-2 103-3 303-3 306-1 306-2

GHG Emissions

In 2018, our 90 MW and 35 MW power plants emitted on average 1.25 tonnes of CO2/ MWh of electricity produced from coal, which represents a total of 782,471 tonnes of CO2 (2017: 900,431 tonnes) released. Also, our bioethanol distillery captured and delivered 3,082 tonnes of carbon dioxide to Gaz Carbonique Ltd for use in the beverages industry. However, with the implementation of our Carbon Burn-Out unit, we will avoid the emission of around 29,000 tonnes of carbon dioxide (through the avoided production and import of Portland cement). In addition, the use of bagasse as fuel, contributed to avoiding the emission of around 100,229 tonnes of CO2e in 2018, which helped us mitigate GHG emissions and reduce our impact on climate change.

305-1

Environmental activity costs (Rs) 2018 2017 2016

Bonsucro membership & training 99,750 166,175 32,300

ISO 14001 audits 67,000 158,000 332,200

Environmental training (external) 15,000 30,000 287,780

Environmental monitoring 820,000 1,034,000 814,000

Collection and disposal of solid waste 194,050 225,150 224,350

Ash management-related expenses including transport 35,680,477 40,377,899 36,328,560

Effluent management 808,291 1,055,432 1,309,088

Other miscellaneous costs 219,373 325,910 164,300

Total 37,903,941 43,372,566 39,492,578

Solid Waste

The implementation of solid waste management practices within all Omnicane entities is under way. Recycling opportunities for paper waste, old batteries and green waste are also being provided across the Group. The Sustainability Department, in collaboration with Mission Verte, is conducting awareness sessions on reducing waste across Omnicane entities.

Environmental Impacts of Products and Services

Environmental Impact Assessments (EIAs) are carried out prior to any major undertaking being implemented and so far, all our major operations have successfully obtained an EIA licence from the Ministry of Environment. With respect to our Smart City development, two EIA reports have already been submitted to the relevant authorities and we hope to receive our EIA licences shortly. Quarterly environmental monitoring reports, containing environmental performance indicators and mitigation activities are regularly sent to the Ministry of Environment for follow-up as per the terms of the EIA and Industrial Waste Audit guidelines.

Environmental Compliance

The Group Environmental Policy strongly sets the commitment to abide by all local and international environmental laws and regulations relating to business operations. Furthermore, our two power plants at La Baraque and St Aubin are successfully certified according to ISO 14001:2015 Environmental Management System, which enables them to better track their environmental aspects including legislation. In 2018, the Company received no fines or sanctions related to non-compliance with applicable environmental laws and regulations.

Environmental Costs and Communication

Environmental protection has a cost associated with it, which must not be neglected when analysing costs of business operations. Usually, as per customary financial accounts, these environmental costs remain hidden within broad categories of operational overheads and expenses. Knowledge of these costs enables us to not only manage them but also to redesign the production process and reduce the pollutants being released into the environment in the future. We have strived to classify these costs into eight main categories, which pertain to our operations that have the highest environmental costs, i.e. thermal energy, bioethanol and milling operations. It should be noted that environment-related expenses represent around 0.9% of the total operating expenses for the Group in 2018.

306-2

103-1 103-2 103-3

103-1 103-2 103-3

103-1 103-2 103-3 307-1


05 / Key Capitals

Social & Relationship CapitalLocal Communities

At Omnicane, we promote inclusiveness with our community stakeholders based on participatory dialogue and exchange of information and ideas. La Baraque’s industrial cane cluster has a dedicated forum comprising representatives of local community stakeholders (“forces vives”) and Omnicane’s Management. Social and environmental issues related to operations are discussed in a transparent and collaborative manner at bi-annual meetings. In line with the BREEAM Communities framework adopted for the Mon Trésor Smart City project, there is ongoing consultation with neighbouring communities to keep them informed about the project and listen to their expectations. We have also implemented an external procedure to capture and attend to any grievance from our stakeholders.

Corporate Social Responsibility

In 2018, Omnicane Foundation in collaboration with various NGOs continued its social engagement in defined priority areas and focused mainly on Southern communities. The CSR funds received from entities within the Omnicane Group were as follows:

CSR contributions from different entities Amount (Rs)

Omnicane Thermal Energy Operations (St Aubin) Ltd 1,777,648

Omnicane Treasury Management Ltd 836,816

Omnicane Holdings Limited 7,800

Omnicane Management & Consultancy Limited 376,492

Other contributions (Coal Terminal) 6,132

Total 3,004,888

Amount (Rs)

Carried forward from 2017 1,362,663

Total CSR funds available in 2018 4,367,551

103-1 103-2 103-3 413-1

103-1 103-2 103-3 413-1 102-52

Ranjit FOOLCHANDGrand Port District Councillor and Chairperson of Forces Vives – Kenya Camp Carol

C O M M U N I T Y O F T H E S O U T H

Omnicane is also developing its smart city next to our village which I believe will be highly beneficial for us especially for the youth in terms of job opportunities.”

“

“I have been living at Camp Carol since 40 years. I appreciate the inhabitants of the South because we all live like a family in a serene atmosphere. We are always helping each other for all types of events in the village and sharing the same cultural values.

Omnicane has been present through the Omnicane Foundation in the South since 2010. Omnicane Foundation is always ready to support us through CSR projects in various fields namely education, poverty alleviation, health, sports and environment.

There have been many achievements in our region thanks to Omnicane Foundation and one example is the recreational green space at Camp Carol which is today a place for the local community to enjoy with their friends and families.”


Expenditure on Projects

Number of Projects by Region

Health18%

Education43%

Sport &Leisure9%

Socio-EconomicDevelopment22%

Environment4%

AdministrativeExpenses

3%

Disaster/Catastrophe

1%

70

60

50

40

30

20

10

0

2018

North South Central

2017 2016

1

66

0 0

National

4 3

44

50

2 21 0

05 / Key Capitals

Social & RelationshipCapital (cont’d)

Key CSR Events

August 2018 – Omnicane Award 2018 Ceremony

April 2018 – Embellishment activities at Camp Carol

August 2018 – Medical check-up at Tyack in collaboration with NGO PATH

September 2018 – APSA Foot Care Karavan for diabetics

February 2019 – Mission Verte Waste Segregation Bin at Winner’s Plaine Magnien

October 2018 – Inauguration of the Valérie Sénèque Breast Cancer Care Centre at Petit Bel Air, Mahébourg

November 2018 – Inter-district Beach Volley Tournament organised by Grand Port District Council at La Cambuse Public beach

September 2018 – Undergraduate Bursaries offered through Omnicane Foundation Scholarship Scheme

September 2018 – Presentation of certificates for training in organic gardening at Britannia


05 / Key Capitals

Social & RelationshipCapital (cont’d)

Supply Chain Management

In support of our Company’s vision and our quality management system, we work with our suppliers to:

• Operate a lean supply chain that supports our corporate policies; • Develop procurement solutions in line with customer, regulatory and wider stakeholder needs and expectations; • Create long-term value and reduce risk for our business, suppliers and stakeholders.

Our Central Procurement Department’s role is to procure goods, works and/or services for the whole Group at the best possible cost, in the right quality and quantity, and at the right time. Priority is given to suppliers from Omnicane’s catchment area, followed by local suppliers and then foreign suppliers.

Local suppliers are usually chosen by the Central Procurement Department for the purchase of the Group’s requirements in general materials and consumables, and 85% of our purchases are sourced from local suppliers. Our spending on local suppliers in 2018 amounted to 52% of the total expenditure on procurement of goods, works and services for the Group. Local suppliers are preferred as proximity offers a clear advantage in terms of payment facilities and after-sales service. Foreign purchasing is done in situations where specific technical equipment/machinery or products are required.

As part of our sustainable procurement practice and supplier evaluation mechanism, we regularly evaluate our suppliers based on environmental performance and eco-friendly products, on their labour practices, as well as regarding human rights and societal impacts. So far, 42 suppliers have been assessed through questionnaires, site visits and meetings and in 2018, 28 suppliers have been successfully evaluated.

We encourage our suppliers to work with us to continually improve our procurement process.

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05 / Key Capitals

Human Capital

AgriculturalOperations

36%

Milling –Sugar Factory

20%

Milling –Refinery

10%

Logistics8%

Holiday InnMon Trésor

9%

Thermal – La Baraque6%

Thermal – St Aubin3%

Distillery4%

Management& Consultancy

4%

1,396Employees

Ratio Male:Female Ratio Staff:Workers

Male88%

Female12% Staff

20%

Workers80%

Omnicane recognises human capital as a key driver of its success and sustained competitive advantage. The collective knowledge, skills, attitude and innovation of our employees enable us to achieve our vision and mission. Our Top Management has adopted a strategic and comprehensive approach to people management and promotes an enabling work environment. Our human capital strategy thus focuses on reinforcing the competence, energy and integrity that our employees bring to their roles, which in turn contributes to the success of Omnicane and maximises stakeholder value.

Attracting and Retaining the Right Talent

Investing in employees with the right talent means working with people with the correct values, attitude, aptitude and culture match along with their ability to adapt and learn continuously. In 2018, the Group employed a total of 1,396 people, including 12% women. Staff members made up 20% of the total number of employees, with workers representing the remaining 80%. It should be noted that the priority of consideration for employment is given to inhabitants of the local community.

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Employees per Entity


The employee turnover rate for the Group excluding Holiday Inn Mon Trésor stood at 1.4% as at December 31, 2018. The employee turnover in agricultural and milling operations is explained by the fact that, given the seasonality of activities in the cane industry, seasonal and contractual workers are employed for a specific period to ensure optimum results.

Training and Development

Training and development is regarded as an integral part of our human resource development initiatives. We endeavour to improve or develop additional skills and competencies among our employees for increased productivity and efficiency. Appropriate training programmes are offered to equip them with the necessary skills, knowledge and attitude to perform successfully in their working environment and to comply with customer requirements. Also, Omnicane continues to provide placement opportunities that provides young students with exposure to the working environment where they experience the importance of teamwork, soft skills and discipline. The estimated average number of training hours per employee is around 40.3 hours per year for 2018.

Results-Based Leadership Programme Omnicane values aspirational leadership and is committed to capitalising on leadership development. This explains our investment, since October 2017, in the Results-Based Leadership (RBL) Programme, an 18-month intensive programme under the Accountability, Innovation and Sustainability pillars. Through this programme, we ensured the mentoring and development of 51 senior and middle managers as future leaders. As a starting point, we conducted a 360º survey to understand the level of responsible leadership displayed by participants, evaluating their commitment to represent Omnicane’s values and provide insight into individual performance against leadership competencies. Participants in this programme were also divided into nine different groups, each with a project on the following broad themes: valorisation of co-products and by-products from Omnicane’s operations, operational efficiency and human resource development. These projects not only brought concrete results in terms of increase in efficiency of our processes and cost savings, but also promoted team ethos within and between the different entities.

Labour/Management Relations

Omnicane nurtures an environment of trust to ensure healthy labour relations in order to reinforce employee engagement in a harmonious environment. Conflicts are managed through effective communication between workers and staff. Our human resource management philosophy is based on an open-door policy and we have implemented internal and external grievance procedures to address and help resolve conflicts.

Industrial Relations

The industrial relations landscape has a prominent share in the working scenario where an effective relationship between labour and capital is required for uninterrupted production. The last Collective Agreements for Agricultural and Non-Agricultural Workers of the Sugar Industry having ended in December 2017, the bargaining process for a new Collective Agreements has started during the year 2018.

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103-1 103-2 103-3 404-1 404-2

103-1 103-2 103-3 402-1

102-41 402-1

Premilla DOORBEEJAHLorry driver – Omnicane Logistics Operations Limited

Driving has always been a passion for me. Being the first female lorry driver of a logistics’ company has been a dream for me. I love my job for which I dedicate myself entirely.”

Driving has always been a passion for me.

““The South is a very relaxing and healthy environment to live and work. There is no stress due to low traffic in the South compared to other regions of the country.”

05 / Key Capitals

HumanCapital (cont’d)

W O R K I N G I N T H E S O U T H


05 / Key Capitals

HumanCapital (cont’d)

Occupational Accidents and Man-Days Lost

Entity Number of accidents Man-days lost

Male Female Total Male Female Total

Agricultural Operations 33 2 35 135 9 144

Logistics 43 0 43 304 0 304

Thermal – La Baraque 6 1 7 129 0 129

Thermal – St Aubin 0 0 0 0 0 0

Milling – Sugar Factory 62 1 63 168 0 168

Milling – Refinery 66 1 67 185 3 188

Distillery 9 1 10 38 0 38

Holiday Inn Mon Trésor 9 6 15

Human Rights Freedom of Association and Collective Bargaining

Freedom of association is one of the most basic human rights. We promote human rights and equality in the workplace. There are no cases of child labour or forced labour recorded in our operations as per our Child and Forced Labour policy. We also uphold freedom of association for all our employees and the right to collective bargaining. Also, following the introduction of the General Data Protection Regulation (GDPR) in the European Union, it is imperative to implement appropriate measures to comply with applicable data protection and privacy laws in the interest of both our internal and external stakeholders.

Diversity and Equal Opportunity

We are committed to diversity and equality in the workplace. We value everyone’s differences and tolerate no discrimination, violence, abuse or harassment. Recruitment is conducted by offering equal opportunity regardless of race, age, gender, caste or background and is based on qualifications, performance, skills and experience. Omnicane does not discriminate and provides the same equal pay and opportunities to both male and female employees, doing the same amount of work and having same work requirements. During the year under review, no incident of discrimination has been reported to our HR Department.

Occupational Health and Safety

The health and safety of our employees is a key concern at Omnicane. Through relevant policies, the top Management is committed to providing a safe working environment to all employees and to any other stakeholder on our business premises. We also provide regular awareness and training programmes and implement the necessary controls to ensure a safe workplace and the well-being of our workforce. However, risks associated with our activities are inevitable, such as operation of industrial machinery and equipment, bagging and handling of products, and cultivation and harvesting activities in the fields. There has been one fatal accident recorded during the year in our logistics operations, however remedial actions have already been taken to prevent such accident in the future.

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103-1 103-2 103-3 202-1 405-2 406-1

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Representation of our Workforce on Health and Safety Committees in 2018

Employee representatives

(including Management) Total employees %

Milling – Sugar Factory 27 282 9.6

Milling – Refinery 19 140 13.6

Agricultural Operations & Logistics 22 615 3.6

Thermal – La Baraque 15 81 19

Thermal – St Aubin 7 41 17.1

Distillery 13 56 23.2

Holiday Inn Mon Trésor 13 126 10.3

Health and Safety Committees

We fully support the establishment of health and safety committees within our entities. Meetings held at least every two months provide an excellent platform for employees and Management to interact and discuss opportunities to further improve the safety of our work environment and welfare of our employees. Collective agreements signed with the different sugar industry associations and trade unions cover the following health and safety matters: use of personal protective equipment; estate hospital facilities; Group personal accident scheme; medical insurance cover for employees and dependents; welfare and occupational health issues.

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Welfare

The health of our team members is another important component of our health and safety policy. In 2018, our preventive approach to our employee health and well-being included screening campaigns, vaccination and medical visits for employees.

Fighting Diabetes at the Workplace Programme In view of the high prevalence of diabetes and pre-diabetes in Mauritius, and as a responsible and caring employer, we have been involved since October 2018 in the Fighting Diabetes at the Workplace (FDW) Programme covering some 500 employees within La Baraque’s cluster over the next two years. The main objectives are to raise awareness of the fight against diabetes and offer a range of medical and psychosocial support facilities to ensure systematic detection, follow-up and treatment of diabetic and pre-diabetic employees. We have partnered with PATH and APSA, two specialised NGOs, to implement this project along with relevant stakeholders. The total cost is estimated at Rs 5 million. In addition to a matching grant of Rs 2.5 million from the Mauritius Research Council, Omnicane will provide the remaining amount as in-kind contribution.

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05 / Key Capitals

Intellectual CapitalDigital Transformation Journey Digital business transformation requires business model change, and this value proposition is the foundation of a business model. In order to deliver value, we have built a strong ecosystem, creating a culture of innovation by engaging our people from different business units to work together. With the objective of acquiring the right tools to further optimize our processes, divisions and business ecosystem, Omnicane has embarked on a digital transformation journey to enhance efficiencies and synergies in our operations and service delivery. In this process, we have partnered with renowned international consultants such as Gartner and PricewaterhouseCoopers (PwC), to ensure that we have the right governance structure in place and deliver results during each phase of the project.

Omnicane’s Certifications

ISO 9001:2015

ISO 14001:2015

OHSAS 18001

ISO 22000

ISO 50001 BRC

Management & Consultancy •Milling – Sugar Factory • •Milling – Refinery •Distillery • •Thermal LB • • •Thermal SA • • •

102-12


Risk Management

06


06 / Risk Management

Risk Governance & Methodology

Board of DirectorsRisk Committee

Group ChiefRisk Officer

Risk Owners &Control Owners

InternalAudit

EstablishContext

RiskTreatment

RiskIdentification

RiskEvaluation

RiskAnalysis

RiskReviews

IntegratedRiskManagement

102-11 102-15

Omnicane’s Enterprise Risk Management function is embedded throughout our Group and ensures an integrated approach to managing current and emerging threats to its operations and activities. We acknowledge that risk management plays a vital role in business strategy and planning discussions, where our defined risk appetite and risk tolerances facilitate risk-return discussions and sets boundaries to Group-wide risk-taking. This also allows us to take a precautionary approach to our activities and operations. Through its Risk Committee, the Board of Directors ensures that resources are deployed effectively in identifying and addressing risks and managing them appropriately for value creation.



Risk Governance & Methodology (cont’d)

risk treatmentplans

963controlassessments

11

963control

assessments

11risk

treatmentplans

531controls

186business

risks

33boardrisks

531controls

186businessrisks

33boardrisks

Risk Ratings

In the Framework, two levels of risk are considered: risks identified at Board level and risks identified at business unit level. The Board is responsible for management of the board risks and the department heads/risk owners are responsible for managing risks identified at business unit level. The risks identified at business unit levels were mapped to the relevant board risks. Each risk was therefore rated in terms of likelihood and impact, and a total score was obtained (product of likelihood and impact ratings). The information gathered through risk analysis was used to inform the risk evaluation and guide risk treatment to be chosen.

Risk CategoriesIn recognition that risk may arise at multiple levels (from taking strategic decisions, to implementing supporting actions) and take many forms, Omnicane categorised its risks as follows: • Financial • Operational • Political & Regulatory • Natural Environment • People • Business Environment & Market • Partners & Suppliers

Risk Statistics 2018

Category Score Range

Low 1 – 5

Medium 6 – 10

High 11 – 25

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Our Material Risks

The 10 material risks that we have prioritised this year as having a material impact on Omnicane’s ability to create value are described below.

Risk Rating Risk drivers Impact on value Mitigating actions

Risk Category: Financial

1 Exchange rate fluctuations

High This may arise from international economic situations, or changes in inflation or interest rates

• Higher costs or lesser revenue

• Decreased profitability

• Hedging

• Group Treasury manages all foreign purchases

• Use of real time information to make informed decisions

2 Fluctuations in commodity prices

High This may occur as a result of the abolition of sugar quotas leading to low prices for sugar on the international market or world market prices for bioethanol

• Loss in revenue

• Impact on output of operations

• Reputational impact due to untimely product delivery

• Hedging

• Regular consultation with MSS representatives and keeping aware of changes affecting sugar pricing

• Establishment of a sugar trading and marketing department

• Tracking of market trends/forecasts

• Keeping products in stock up to the storage limit

Risk Category: Operational

3 Decreasing land under cane cultivation

High This may occur due to the Group’s diversification strategies, e.g. property development and/or abandonment of sugarcane cultivation by small planters

• Reduced sugarcane production

• Loss of revenue

• Re-landscaping of fields to increase cane yields and mechanisation

4 Shortage of raw materials

High This may arise from reduced sugarcane harvest, leading to lower volumes of molasses and bagasse or unavailability of supplier to provide raw materials

• Reduced operations/ temporary stoppage

• Increased production cost

• Reputational impact with respect to clients

• Planters’ Cane Advisory Department proposes total cane management services for small planters and liaises with contractors to provide them with quality service at a competitive price

• Awareness campaigns to encourage contractors/planters to harvest and transport sugarcane to the mill in a timely manner

• Core sampling of sugarcane at the factory for quality control

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Risk Governance & Methodology (cont’d)

Our Material Risks (cont’d)


Risk Category: Operational (cont’d)

5 Fire outbreak High This may arise from the presence of flammable substances, defective equipment or poor maintenance

• Temporary stoppage of operations

• Loss of revenue

• Injuries/ Fatalities

• Increased cost of repairs

• Personnel training for use of equipment and fire drills in accordance with the Occupational Health and Safety Act 2005.

• Implementation of emergency response procedures

• Compliance with safety procedures

• Installation of foam suppression system on all tanks and sprinklers at each level of the distillery

• Regular maintenance and monitoring of operations

6 Information security and cyber resilience

High This could result from poor data management and privacy standards, inadequate cybersecurity safeguards or cybercrime in the form of ransomware

• Financial impact

• Operational impact

• Reputational impact

• Enhanced data governance and privacy practices

• Proactive management of third party exposure

• Improved security posture on all architectural layers

• Proactive vulnerability scanning

• Regular sensitisation of business users

Risk Category: Political & Regulatory

7 Changes in legal and other requirements

High This may arise from international or local economic situations, political motivations or market/customer requirements

• Financial impact

• Operational impact

• Control by Omnicane’s Legal and Compliance Department, or ensuring that the Company is complying with legal and other requirements

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Risk Category: Natural Environment

8 Non-compliance with environmental legislation

High This may arise due to equipment failure, quality of raw material, change in legislation, sabotage or poor air quality, amongst others

• Fine and imprisonment

• Temporary closure of business

• Reputational risk

• Financial risk

• Environmental Management system in place in some operations

• Abide by maintenance schedule

• Emergency response procedures are in place

• Monitoring and measurement of operations

Risk Category: People

9 Injuries at work

High This may be caused by human negligence, lack of communication or training, inadequate use of Personal Protective Equipment (PPE), work pressure or unsafe work environment

• Fines and penalties

• Strained relations with employees

• Temporary slowdown of operations

• Reputational impact

• Proper work planning

• Regular health and safety audits, safety risk assessments and trainings

• OHSAS 18001 certification effective for the Company’s two power plants.

• Provision of PPE to employees/contractors as and where applicable and raising awareness about workplace health and safety requirements

Risk Category: Business Environment & Market

10 Property over supply on the market

Medium This may arise from business diversification, government policies and incentives and/or economic and political stability

• Loss in potential revenue

• Market survey conducted prior to each project

Risk TreatmentRisk treatment involved examining possible options to determine the most appropriate action for managing the risk. Treatment actions are required where current controls are not managing the risk within defined acceptable levels. Treatment plans involve providing controls or improving/modifying existing controls and implementing additional controls.

Risk Reviews

Omnicane realises that risk has a dynamic context resulting from the constantly changing external and internal environments. After completing a risk assessment, Omnicane reviews not only risks but also the effectiveness and adequacy of existing controls, risk treatment plans and the process for managing their implementation. The monitoring and reviewing process is automated on a cloud-based system.

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102-15


CorporateGovernance

07


07 / Corporate Governance

Statement of Compliance(Section 75 (3) of the Financial Reporting Act)


Introduction

Incorporated on September 15, 1926, Omnicane Limited (“Omnicane” or the “Company”) is a public interest entity as defined under the Financial Reporting Act 2004. The Company is also listed on the Official Market and included in the Sustainability Index of the Stock Exchange of Mauritius Ltd. This Corporate Governance Report sets out how Omnicane has applied the principles contained in the National Code of Corporate Governance for Mauritius (2016) (the “Code”). A compliance assessment with respect to the Code is found in Annex 1 of this Integrated Report.

The Board of Directors affirms its commitment to providing strong leadership and independent judgement for complying with all legal and regulatory requirements and ensuring long-term success of the organisation. To the best of the knowledge of its Board of Directors, Omnicane has complied with most of the requirements of the Code. This report is available on Omnicane’s website: www.omnicane.com

102-32

Principle 1 Governance Structure Board Charter The governance structure of Omnicane is set out in its Board Charter. The Charter defines the role, function and objectives of the Board of Directors, the various Board Committees, the Chairperson and the Group Chief Executive Officer (“CEO”). It also sets out how they interact in order to promote efficient, transparent and ethical functioning and decision-making processes within Omnicane. The Board Charter is available on Omnicane’s website at: www.omnicane.com

Management Contract

Omnicane Management & Consultancy Ltd (“OMCL”), under a management contract, provides companies within the Group with a range of management and executive services including administrative, financial, legal, project management, sustainability, internal auditing, marketing, procurement and communication. OMCL employs and remunerates the senior executives of the Group.

Organisational Chart and Statement of Accountabilities

The governance structure and organisational chart of Omnicane for setting out the key senior positions as well as the reporting lines are found below:

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102-20

Corporate Governance CommitteeChairperson: Didier MAIGROT

Board of Directors

Investment CommitteeChairperson: Pierre M. D’UNIENVILLE

Chief Executive OfficerJacques M. D’UNIENVILLE, GOSK

Audit CommitteeChairperson: Preetam BOODHUN

Risk CommitteeChairperson: Bertrand THEVENAU

Property Development CommitteeChairperson: Bertrand THEVENAU

Senior Management/Executives

Name of PIE: Omnicane Limited

Reporting Period: Financial year ended December 31, 2018 We, the Directors of Omnicane Limited, confirm that to the best of our knowledge: the Company has complied with all its obligations and requirements under the Code of Corporate Governance.

Signed by

Didier MAIGROT Jacques M. D’UNIENVILLE, GOSKCHAIRMAN CHIEF EXECUTIVE OFFICER

March 29, 2019



Principle 2 The Structure of the Board & its Committees

Age Group

Age: 50-5973%

Age: 40-4918%

Age:60-699%

Gender

Male91%

Female9%

Length of Tenure

6-10 years36%

0-2 years37%

More than10 years27%

Board Structure

Guided by the advice and recommendations of the various sub-committees, the Board acts in the best interests of the Company’s stakeholders. The roles of the Chairperson and of the Chief Executive Officer are distinct and have been clearly defined. A strategic five-year plan is prepared and reviewed every year by the Board.

Board Composition

Under a defined unitary structure, Omnicane’s Board of Directors consists of the right mix of Executive and Non-Executive Directors with the appropriate balance of skills, experience, independence and knowledge of the organisation. It also has sufficient diversity in terms of age, educational background and professional qualifications of the Directors for better decision-making. All the Directors are Mauritian and ordinarily reside in Mauritius. As long as Non-Executive Directors remain independent of Management and are of the right calibre and integrity, they can perform their required duty of looking after the Company’s interests. The Board meets quarterly and at such other times as may be required. There is a provision in the Company’s Constitution for decisions taken between meetings to be confirmed by way of Directors’ resolutions.

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102-22 102-26 102-27 405-1 Committee Composition Main responsibilities

Corporate Governance Committee

Incl. Nomination Committee

Incl. Remuneration Committee

Non-Executive Chairperson: Didier MAIGROT

Non-Executive Director: Koosiram CONHYE Jacques M. D’UNIENVILLE, GOSK is invited to attend the meetings

• Advise and make recommendations to the Board on all aspects of corporate governance.

• Advise the Board on key appointments at Board and Top Management level.

• Review the remuneration structure of the Group for senior management.

Investment Committee Non-Executive Chairperson: Pierre M. D’UNIENVILLE

Non-Executive Directors: Preetam BOODHUNDidier MAIGROT

Executive Director: Jacques M. D’UNIENVILLE, GOSK

• Ensure that the Company’s investments are in line with the Board’s strategy.

• Review the detailed investment plans of the Group, to ensure that the projected risk-adjusted returns are within acceptable norms.

• Monitor and review progress on the Group’s investment objectives and the strategic plan set out to achieve them.

Property Development Committee

Non-Executive Chairperson: Bertrand THEVENAU

Non-Executive Director: Valentine LAGESSE

Executive Directors: Jacques M. D’UNIENVILLE, GOSKNelson MIRTHIL

• Formulate a long-term strategy of value addition through development or disposal of the Company’s land assets and making recommendations to the Board accordingly.

• Oversee procedures relating to all the Company’s land development projects for transparency and best interests of the Company.

• Identify, assess and select the best contractors, through tenders, and monitor progress in the works involved for timely execution.

• Deal with all land-related matters, and make recommendations to the Board accordingly.

Board Committees

The Board has five sub-committees, which have been established to help its responsibilities. Each committee acts according to its written terms of reference approved by the Board. They set out the Committee’s purpose, membership requirements, duties and reporting procedures. Board Committees may take independent advice at the Company’s expense. The Company’s Secretary acts as secretary to all the Committees.

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Principle 2The Structure of the Board & its Committees (cont’d)

Board Committees (cont’d)

Committee Composition Main responsibilities

Audit Committee Non-Executive Chairperson: Preetam BOODHUN

Non-Executive Directors: Koosiram CONHYEBertrand THEVENAU In attendance:Jacques M. D’UNIENVILLE, GOSK Nelson MIRTHIL,internal auditors, external auditors and any other managers

• Consider and review the reliability and accuracy of financial information and appropriateness of accounting policies and disclosure practices.

• Examine and review the quarterly financial results, annual financial statements or any other documentation to be published in compliance with the Company’s accounting standards.

• Review compliance with applicable laws and best corporate governance practices and regulatory requirements.

• Review the adequacy of accounting records and internal control systems.

• Monitor and supervise the functioning and performance of internal audit.

• Direct interaction with the external auditors at least once a year without the presence of senior management.

• Direct interaction with the Internal Audit Manager at least once a year, without Management being present, to discuss their remit and any issues arising from the internal audits carried out.

• Consider the independence of the external auditors and making recommendations to the Board on their appointment or dismissal.

Risk Committee Non-Executive Chairperson: Bertrand THEVENAU

Non-Executive Directors: Preetam BOODHUNDidier MAIGROT

In attendance: Jacques M. D’UNIENVILLE, GOSKNelson MIRTHIL, Group Chief Sustainability Officer (Chief Risk Officer), and any other managers

• Review the effectiveness of the Group risk management process and approve strategies to address potential risks throughout the whole organisation.

• Evaluate the risks associated with all new projects on an ongoing basis, assessing the probability and impact of foreseeable events on the Company’s situation.

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Board and Committee Attendance During the year under review, five Board meetings were held with attendance as follows:

Share Dealings by Directors The Directors ensure that their dealings in the Company’s shares are conducted in accordance with the principles of the Model Code for Securities Transactions by Directors of Listed Companies, as detailed in Appendix 6 of the Stock Exchange of Mauritius Listing Rules.

Upon appointment to the Board, Directors are required to inform the Company Secretary of the number of shares they directly or indirectly hold in the Company. This declaration is entered into a Directors’ Interest Register, which is maintained by the Company Secretary and updated with any subsequent transactions made by the Directors.

Name of Directors Board of Directors

Investment Committee

AuditCommittee

Risk Committee

Property Development

Comittee

Corporate GovernanceCommittee

Number of meetings held 4 4 4 2 6 2

Kishore Sunil BANYMANDHUB (resigned) 1 1 - - - 1

Jacques M. D’UNIENVILLE, GOSK 4 4 - - 6 -

Nelson MIRTHIL 4 - - - 5 -

Marc HEIN, SC, GOSK 4 - - - - -

Bertrand THEVENAU 2 - 3 2 6 -

Pierre M. D’UNIENVILLE 4 4 - 2 - -

Didier MAIGROT 4 2 - 1 - 2

Thierry MERVEN 4 - - - - -

Preetam BOODHUN 4 4 4 - - -

Sachin Kumar SUMPUTH (resigned) 1 - - - - -

Bojrazsingh BOYRAMBOLI (resigned) 1 - 1 - - 1

Valentine LAGESSE 4 - - - 6 -

Jimmy TONG SAM 3 - - - - -

Koosiram CONHYE 2 - - - - -



Principle 3 Directors’ Appointment ProceduresNon-Executive Directors are chosen for their business experience and ability to provide a blend of knowledge, skills, objectivity, integrity, experience and commitment to the Board. Brief profiles of all the Directors are found below. New appointments to the Board are subject to the recommendation of the Corporate Governance Committee and formal approval by the Board. The appointment of new Directors is subject to confirmation by shareholders at the next Annual General Meeting following their appointment. At each Annual General Meeting of Shareholders, not less than one-third of the Directors must retire, being those Directors longest in office since their appointment or last re-election. If they are available, they can be proposed for re-election. The Board makes appropriate recommendations to shareholders regarding the re-election of Directors. The Board is aware that the retirement of Directors by rotation, as provided for in its Constitution, is a departure from the Code, which provides that each Director should be elected (or re-elected as the case may be) every year at the Annual Meeting of Shareholders. The Company provides insurance cover for Directors’ and officers’ legal liabilities.

Directors’ Profiles

Didier MAIGROT NON-EXECUTIVE CHAIRPERSON –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2012 Appointed as Chairperson on April 25, 2018 Didier Maigrot holds a Maîtrise en Droit from Université d’Aix-Marseille III (France). He has been practising as a notary since 1996 and is a director of Compagnie de Beau Vallon Ltée.

Jacques M. D’UNIENVILLE, GOSK CHIEF EXECUTIVE OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2001 Jacques M. d’Unienville holds a bachelor’s degree in Commerce from the University of Cape Town. Prior to joining Société Usinière du Sud (SUDS) as Chief Executive Officer in 2005, he was the Managing Director of Société de Traitement et d’Assainissement des Mascareignes. He has held office as Chief Executive Officer of MTMD (now Omnicane Limited) from April 1, 2007. He is the Chairperson of Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) Limited, Omnicane Milling Operations Limited and is a director of Real Good Food Company plc, Southern Cross Tourist Co. Ltd and The Union Sugar Estates Co. Ltd. He is a board member of several sugar sector institutions in Mauritius and was the President of the Mauritius Sugar Producers Association in 2015.

Nelson MIRTHIL CHIEF FINANCE OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2008 Nelson Mirthil is a Fellow Member of the Association of Chartered Certified Accountants (FCCA). He started his career in the Audit Department of De Chazal du Mée (now BDO & Co.) before joining Ernst & Young, where he was promoted to Audit Manager. He gained broad financial experience through his involvement in mergers, acquisitions and special assignments in Africa. He has also acted as Fund Manager of the Mauritius Development Investment Trust (MDIT), a listed investment company. Mr. Mirthil joined Omnicane in 2003 as Chief Finance Officer. He is a board member of various companies within the Group, the main ones being Omnicane Milling Operations Limited, Omnicane Thermal Energy Operations (La Baraque) Limited, Omnicane Bio-Ethanol Operations Limited, Airport Hotel Ltd and Mon Trésor Smart City.

Marc HEIN, SC, GOSK NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2006 Marc Hein, SC, GOSK is a barrister. He holds a bachelor’s degree in Law and a Licence en Droit. He started practising law in Mauritius in 1980 in the Chambers of Sir Raymond Hein, QC. In 1989, he set up his own practice, Juristconsult Chambers of which he is now the Chairman. He is the legal adviser to several well-known local and multinational corporations, trusts, banks, financial institutions and fund managers. He is a director of various Mauritian companies, global business companies and offshore investment funds. He was also the Chairperson of the National Economic and Social Council and the Financial Services Commission.

Bertrand THEVENAU NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2008 Bertrand Thevenau holds a Diplôme Universitaire de Technologie, with a major in international marketing. He has wide experience of the Mauritian industrial sector. He is currently the Executive Director of Tropic Knits Ltd (CIEL Textile), and a director of Compagnie de Beau Vallon Ltée and Domaine de Labourdonnais.

Pierre M. D’UNIENVILLE NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2010 Pierre M d’Unienville holds a Licence en Sciences Economiques from the Université d’Aix-Marseille III (France) and has postgraduate specialisation in Finance and Strategy from IEP Paris. After gaining international experience in finance and in mergers and acquisitions, he founded Infinite Corporate Finance Ltd, a consultancy firm, of which he remains the partner and deal executive. In addition, he is currently the Executive Chairman of Le Warehouse Ltd.

Thierry MERVEN NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2012 Thierry Merven holds a Maîtrise en Aménagement du Territoire and a Diplôme d’Etudes Supérieures Spécialisées (DESS) en Aménagement et Développement Local from the Institut d’Aménagement Régional d’Aix-en-Provence (France). He is currently the Chief Executive Officer of Compagnie de Beau Vallon Ltée and the Union Group of Companies. He joined the sugar sector in Mauritius in 2004 as General Manager of Compagnie de Beau Vallon Ltée which manages Riche en Eau SE. Mr Merven started his career in 1987 in France where he practised as a town planner and environmental specialist. Upon coming back to Mauritius in 1996, he successively held office as the Manager of Société de Traitement et d’Assainissement des Mascareignes Ltée (STAM) and IBL Environment Ltd. He was the President of the Mauritius Chamber of Agriculture between 2008 and 2011 and is a board member of several sugar-sector institutions and companies involved in sugar production, hospitality and power generation.

Preetam BOODHUN NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2016 Preetam Boodhun holds a Diploma in Mathematics. He currently works as educator at Keats College and is the Chairperson of the Sugar Investment Trust (SIT), SIT Leisure (a subsidiary of the SIT) and the strategy and investment committee of the SIT Group.

Valentine LAGESSE NON-EXECUTIVE DIRECTOR –––––––––––––––––––––––––––––––––––––––––––––––––Appointed to the Board in 2017 Valentine Lagesse holds a bachelor’s degree in Management. She has worked on the implementation and development of several commercial and residential projects.

Jimmy TONG SAM NON-EXECUTIVE DIRECTOR–––––––––––––––––––––––––––––––––––––––––––––––––Jimmy Tong Sam qualified as an Expert-Comptable in Luxembourg, then as a Fellow Chartered Accountant (FCA) of the Institute of Chartered Accountants in England and Wales (ICAEW) in 1994. He also holds a bachelor’s degree in Mathematics from Bristol University, UK. He first started at Shell Mauritius Limited, a listed company on the Stock Exchange of Mauritius and is now the founder partner of Mayfair Trust SARL, located in Luxembourg.

Koosiram CONHYE NON-EXECUTIVE DIRECTOR–––––––––––––––––––––––––––––––––––––––––––––––––Koosiram Conhye is an Associate member of the Chartered Institute of Secretaries and Administrators and holds a Diploma in Marketing and an MSc Finance. He joined the public service in February 1981 and has served in various Ministries and Departments at Senior Management level for more than two decades. He was assigned the duties of Permanent Secretary at the Ministry of Technology, Communication and Innovation on March 15, 2016 and was subsequently appointed in a substantive capacity on January 05, 2017. He is presently the Permanent Secretary of the Ministry of Social Security, National Solidarity and Environment and Sustainable Development.



Principle 3Directors’ AppointmentProcedures (cont’d)


Principle 4 Directors’ Duties, Remuneration & Performance

Board Induction The Board assumes responsibility for succession planning of its Directors and the appointment and induction of new Directors to the Board. All new Directors participate in an induction and orientation process whereby they receive an induction pack containing Omnicane’s governance processes, their roles and responsibilities, company policies, code of business conduct and an overview of business operations. They are also informed of new developments falling outside the scope of scheduled Board meetings. Moreover, new Directors get the opportunity to visit the business units and interact with their executives. They are regularly informed of relevant new legislation and regulations and are invited to attend training sessions on strategic thinking and corporate governance structures, as planned during the year. The Board reviews the professional development and ongoing education of all its Directors.

Board Evaluation

The last Board evaluation was conducted in 2015 to review the effectiveness of the Board, its committees and individual Directors. The Board intends to conduct the next evaluation exercise next year to align with the recommendations with the National Code of Corporate Governance 2016.

102-28Legal Compliance

The purpose of the Legal Department of Omnicane is to oversee legal and regulatory requirements of the Company and ensure strict compliance with laws and regulations pertaining to the organisation and its activities. In addition, our external legal advisors and other industry associations help us keep abreast of all relevant laws and regulations applicable to the nature of our business. It should be noted that in 2018, no significant fines or non-monetary sanctions have been imposed for non-compliance with laws and regulations, including those pertaining to provision and use of products and services, environmental laws and regulations. There have also been no legal actions for anti-competitive behaviour, anti-trust, and monopoly practices and their outcomes.

Code of Business Conduct & Ethics

Omnicane Limited is fully committed to abide by its Charter, which defines its vision, mission, values and sustainability engagement. The Company’s main values fall under the following categories: Ethics (integrity, fairness and transparency), Professionalism (respect, trust, innovation and talent management) and Team spirit (sense of belonging, caring, solidarity, bond and motivation). Other important documents describing the principles and codes of conduct and ethics are: our Employee Handbook, our Code of Business Conduct for the Board and our Code of Ethics for our employees. They encourage our Directors, Management and employees to obey the law, to respect others, to be fair and honest and to protect the environment. These documents have been developed in a well-structured way with the joint consensus of the Board of Directors and senior management. Regular training is also given to new and existing employees on our Employee File, which contains all these necessary documents. In addition, the Omnicane Group comprises a diverse population of individuals with differing roles and functions, as well as ethnic and cultural backgrounds. To function fairly and effectively, the Company must value behaviour which recognises the dignity and privacy of individuals, and which enhances fair dealing and representation both in action and perception. As such, Omnicane condemns competitive behaviour or corruption practices and shall take strong remedial actions to address any such behaviours should they arise.

Declaration of Interests

The relevant interests of Directors are considered at each meeting of Directors. Individual Directors declare their specific interests in any discussion in respect of which they might have a conflict of interest. The Company Secretary maintains a Register of Interest, which is updated with every transaction entered into by Directors or their closely related parties. In addition to having access to advice from the Company Secretary, members of the Board may, in appropriate circumstances, take independent professional advice at the Company’s expense.

Full details of directorships held by the Company’s Directors in other listed companies are shown below. When there appears to be a conflict of interest, any Director who could have such a conflict of interest will abstain from discussions at Board or Committee meetings when the relevant matter is tabled.

102-25

307-1 206-1 419-1

102-16 103-1 103-2 103-3 205-1 205-2 205-3 206-1



Principle 4Directors’ Duties, Remuneration & Performance (cont’d)

Directors Southern Cross Tourist Co. Ltd The Union Sugar Estates Co. Ltd

Jacques M. D’UNIENVILLE, GOSK CHIEF EXECUTIVE OFFICER

• •Thierry MERVEN • •

Directors’ Interest

Number of shares held as at December 31, 2018

Directors Direct Indirect

Marc HEIN, SC, GOSK NON-EXECUTIVE DIRECTOR 44,990 29,975

Jacques M. D’UNIENVILLE, GOSK CHIEF EXECUTIVE OFFICER 67,000 Nil

Remuneration

The Remuneration Philosophy is to ensure that employees are rewarded for their contribution to the Group’s operating and financial results, with a blend of fixed and performance-related variable pay, comparable with practice within the industries in which we operate in Mauritius.

The Corporate Governance Committee, which encompasses the Nomination and Remuneration Committees, is responsible for the remuneration strategy of the Group.

The remuneration of Non-Executive Directors is approved by shareholders, whereas the Board and Corporate Governance Committee approve the remuneration of senior officers. All Directors receive a fixed fee and an attendance fee for each Board or sub-committee meeting as detailed below:

• Directors at Rs 144,000 yearly and Rs 7,500 per Board sitting • Chairperson at Rs 288,000 yearly and Rs 15,000 per Board sitting • Committee members at Rs 75,000 yearly and Rs 7,500 per Board sitting ; and • Committee Chairperson at Rs 150,000 yearly and Rs 7,500 per Board sitting

It should be noted that Non-Executive Directors have not received remuneration in the form of share options or bonuses associated with organisational performance.

102-35 102-36

Directors’ Remuneration and Benefits

Directors AmountRs’000

Kishore Sunil BANYMANDHUB (resigned in April 2018) 192.0

Jacques M. D’UNIENVILLE, GOSK 414.0

Nelson MIRTHIL 301.5

Marc HEIN, SC, GOSK 192.8

Thierry MERVEN (resigned in December 2018) 181.5

Bertrand THEVENAU 541.5

Pierre M. D’UNIENVILLE 421.5

Didier MAIGROT 476.6

Preetam BOODHUN 429.0

Sachin Kumar SUMPUTH (resigned in October 2018) 130.5

Bojrazsingh BOYRAMBOLI (resigned in June 2018) 122.7

Valentine LAGESSE 275.3

Koosiram CONHYE 171.3

Jimmy TONG SAM 123.0

Interest of Directors in ContractsNone of the Directors of the Company have service contracts with the Company or with any of its subsidiaries.

Significant ContractThe Company has a management contract with Omnicane Management & Consultancy Limited, a wholly-owned subsidiary of the controlling shareholder, Omnicane Holdings Limited.

Directors’ and Officers’ Liability InsuranceThe Company has arranged for appropriate insurance cover in respect of legal actions against its Directors and officers.

Material Clauses of the Company’s ConstitutionThere are no clauses of the Constitution deemed material enough to warrant special disclosure.

Service Contracts None of the Directors of the Company has service contracts with the Company and its subsidiaries.

COMPANY SUBSIDIARIES

Directors of Omnicane Limited 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Executive Directors (Full-time) 716 693 324 332

Non-Executive Directors 3,258 2,807 75 100

Directors of Subsidiaries

Executive Directors (Full-time) 750 755

Non-Executive Directors 451 441

102-35 102-36



Principle 4Directors’ Duties, Remuneration & Performance (cont’d)

Particulars of Directorate in Subsidiaries

Uttam JAUNKEESAW

Eddie AH-CHAM • • • •François VITRY AUDIBERT

Harshil KOTECHA •Vishal BAUTOO •Jacques M. D’UNIENVILLE, GOSK • • • • • • • • • • • • • • •Jean-François LOUMEAU

Jean-Laurent ASTIER

Jean-Michel GÉRARD

Jérôme JAËN • •Joël BRUNEAU •Kaushik PABARI •Khooshiramsing BUSSAWAH •Anil Kumar RAMNUNDUN •Louis DECROP

Nelson MIRTHIL • • • • • • • • • • • • • • •Nicolas MAIGROT

Olivier VAN ROMPAEY • • •Pascal LANGERON

Peter HOUGH

Thomas VIATOUR • • •Rajiv RAMLUGON

Jean-Pierre LAGARDE

Airpo

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•• • • • •• • •

•• • • • • • • • • • • • • • • • • • •

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Principle 5 Risk Governance & Internal Control


Principle 7 Audit

Principle 6 Reporting with IntegrityThe Board is responsible for the preparation of financial statements as per the IFRS and Companies Act 2001, and which impartially present the state of affairs of Omnicane Limited. In view of the Annual General Meeting held in June of each year, the Directors are responsible for preparing the Integrated Annual Report, which provides a holistic and consolidated view of the financial, operational, social, environmental and other performances of the Group. They are also responsible for keeping adequate accounting records which disclose with reasonable accuracy at any time, the financial position of the Group, for safeguarding the assets of the Company and the Group and for taking appropriate actions for the prevention and detection of fraud and other wrongdoings.

102-11 102-29

Risk Governance

The Risk Governance report is found on pages 95 to 99.

Internal Control

The effectiveness of the internal control systems is reviewed by the Audit Committee and provides the Board with reasonable assurance that assets are safeguarded, operations are run effectively and efficiently, financial controls are reliable and applicable laws and regulations are complied with. The Board is responsible for the Group’s system of internal controls and for reviewing its effectiveness. To date, no material financial issues have been identified that would have had an impact on the results as reported in these financial statements. The Board confirms that if significant weaknesses had been identified during this review, necessary steps would have been taken to remedy them.

Whistle Blowing Omnicane fosters and encourages all means to achieve a culture of integrity and good governance. Employees who have genuine concerns about any wrongdoing including but not limited to corruption, illegal, fraudulent or hazardous activities and/or violations of law, regulations, the code of ethics or company policies, are encouraged to promptly report them. An internal grievance procedure and form have been established and shared with all employees. They may first raise any concern verbally or in writing with their direct manager or the HR Department. If for any reason, they feel that it is not appropriate to make such a report to the above-mentioned person or department, they may address their report to the Group Chief Executive Officer.

103-1 103-2 103-3

Internal AuditThe purpose of the Internal Audit Department is to provide an independent, objective assurance and consulting activity designed to add value to the organisation’s operations. The scope of internal audit includes review of the efficiency and effectiveness of operations, reliability of financial and management reporting and compliance with laws and regulations. A fully qualified accountant, who audits the Group’s operations as per a defined audit schedule, heads this department. At each meeting of the Audit Committee, the Internal Audit Manager reports on its programme of review and findings and on all internal audit issues within the Group, highlighting any deficiencies and recommending corrective measures. Internal auditors have unrestricted access to the records, Management or employees. They are authorised to review all activities and transactions undertaken within the Group and to appraise and report thereon if necessary.

The Internal Audit Department provides independent assurance to the Audit Committee on the adequacy and effectiveness of the internal control process. It operates in line with the Internal Audit Charter and has the objectives of:

(i) evaluating the adequacy and improving the effectiveness of our internal control systems; and

(ii) determining the level of compliance with Group companies’ policies and procedures.

The internal audit function maintains its independence and objectivity by planning its internal audits well ahead and being separate and not directly involved in the day-to-day operations of the Company. The Internal Audit Manager also reports directly to the Chief Executive Officer and Audit Committee. The Internal Audit Department works closely with the external auditors to further ensure best practice in this area. The Internal Audit Manager is entitled to convene a special meeting of the Audit Committee in order to deal with any matter he deems urgent.

It is worth noting that the Internal Audit Department’s scope of work does not cover our associates such as MAREF Mon Trésor Investment 1 Ltd, Copesud (Mauritius) Ltée, Coal Terminal (Management) Co. Ltd, and Kwale International Sugar Co. Ltd. Also, no significant issues were raised at Audit Committee level in relation to the Financial Statements.

External Auditors BDO & Co. has been appointed as our external auditors for more than 7 years. The Board of Directors of Omnicane Ltd has resolved to retain the services of BDO & Co. for an additional year and has recommended to the shareholders the re-appointment of BDO & Co., as auditors of Omnicane Ltd for the year ending December 31, 2019. A tender exercise will be launched in view of the change of the external auditors of Omnicane Group for the year ending December 31, 2020.



Principle 8 Relations with Shareholders & Other Key StakeholdersOmnicane Limited believes it is essential to maintain ongoing, open and transparent dialogue with shareholders since they have legitimate interests in the activities and performance of the Group. The latter communicates with its shareholders through the Omnicane Limited Annual Report, the publication of unaudited quarterly results, dividend declarations and the Annual Meeting of Shareholders. There is currently no shareholders’ agreement affecting the governance of the Company by the Board. Omnicane Limited has no share option plans in place.

Shareholding Structure

The holding structure of the Company as at December 31, 2018 was as follows:

Substantial Shareholders As at December 31, 2018, the following shareholders owned more than 5% of the issued share capital:

Shareholders’ Analysis at December 31, 2018

Defined brackets Shareholder count

Ordinary shares Percentage

1 – 500 958 159,771 0.238

501 – 1000 240 194,946 0.291

1,001 – 5000 533 1,274,096 1.901

5,001 – 10,000 157 1,128,186 1.684

10,001 – 50,000 200 4,452,459 6.644

50,001 – 100,000 34 2,383,347 3.557

100,001 – 250,000 9 1,249,143 1.864

250,001 – 500,000 7 2,310,720 3.448

Over 500,000 2 53,859,736 80.373

Total 2,140 67,012,404 100

102-5

Summary by Shareholder Category

Shareholders’ Diary Financial year-end – December Annual Meeting – June

Reports and Profit Statements Publications: Quarterly reports & abridged end-of-year statements – March, May, August & November Annual Report & Financial Statements – June

Final Dividend Declared – NilPaid – Nil

Dividend Policy The Company does not have any predetermined dividend policy. Payment of dividends is subject to the profitability, cash flow, working capital, projected capital expenditure projections, and solvency requirements of the Company. For the year under review, the Company has not declared a final dividend (2017: Rs 2.00) per share.

Related Party Transactions Note 41 to the financial statements for the year ended December 31, 2018 on page 206, details all related party transactions between the Company or any of its subsidiaries or associates, and a Director, Chief Executive, controlling shareholder or companies that are owned or controlled by a Director, Chief Executive or controlling shareholder. In addition, shareholders are apprised of related party transactions through the issue of circulars by the Company in compliance with the Listing Rules of the Stock Exchange of Mauritius Limited. All conflicts of interest and related-party transactions have been conducted in accordance with the conflicts of interest and related-party transactions policy and Code of Ethics.

Count Shares Percentage

Individual 1,902 7,422,815 11.077

Insurance & Assurance Companies 8 464,398 0.693

Pension & Provident Funds 25 1,846,554 2.756

Investment & Trust Companies 13 122,307 0.183

Other Corporate Bodies 192 57,156,330 85.292

Total 2,140 67,012,404 100

Number of shares held % Holding

Omnicane Holdings Limited 47,074,792 70.25

National Pensions Fund 6,784,944 10.08

OmnicaneLimited

Others29.75%

NationalPensions Fund

10.08%

OmnicaneHoldings Ltd70.25%



Key Executives’Profiles Jacques M. D’UNIENVILLE, GOSK CHIEF EXECUTIVE OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Jacques M. d’Unienville holds a bachelor’s degree in Commerce from the University of Cape Town. Prior to joining Société Usinière du Sud (SUDS) as Chief Executive Officer in 2005, he was the Managing Director of Société de Traitement et d’Assainissement des Mascareignes. He has held office as Chief Executive Officer of MTMD (now Omnicane Limited) from April 1, 2007. He is the Chairperson of Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) Limited, Omnicane Milling Operations Limited and is a director of Real Good Food Company plc, Southern Cross Tourist Co Ltd and The Union Sugar Estates Co. Ltd. He is a board member of several sugar sector institutions in Mauritius and was the President of the Mauritius Sugar Producers Association in 2015.

Nelson MIRTHIL CHIEF FINANCE OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Nelson Mirthil is a Fellow Member of the Association of Chartered Certified Accountants (FCCA). He started his career in the Audit Department of De Chazal du Mée (now BDO & Co.) before joining Ernst & Young, where he was promoted to Audit Manager. He gained broad financial experience through his involvement in mergers, acquisitions and special assignments in Africa. He has also acted as Fund Manager of the Mauritius Development Investment Trust (MDIT), a listed investment company. He joined Omnicane in 2003 as Chief Finance Officer. He is a board member of various companies within the Group, the main ones being Omnicane Milling Operations Limited, Omnicane Thermal Energy Operations (La Baraque) Limited, Omnicane Bio-Ethanol Operations Limited, Airport Hotel Ltd and Mon Trésor Smart City.

Eddie AH-CHAM COMPANY SECRETARY –––––––––––––––––––––––––––––––––––––––––––––––––Eddie Ah-Cham is a Fellow Member of the Association of Chartered Certified Accountants (FCCA). He has 19 years of experience in external and internal auditing and in corporate management. He started his career in the Audit Department of Kemp Chatteris Deloitte and was assistant accountant at Express Trading Company Ltd in 1995. He joined Mon Trésor & Mon Désert Ltd (now Omnicane) in 1996 as assistant accountant and served as Internal Audit Manager for 7 years before being promoted to the position of Company Secretary.

Jérôme JAËN GROUP CHIEF OPERATIONS OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Mr Jaën holds a Diplôme d’Ingenieur from Ecole des Mines de Nancy and a Diploma from Ecole Polytechnique. He has 20 years of experience in electricity production from cogeneration plants. He has managed several thermal power plants in Mauritius, Reunion Island, Guadeloupe and France and is currently the Group Chief Operations Officer.

Rajiv RAMLUGON GROUP CHIEF SUSTAINABILITY OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Rajiv Ramlugon holds a BTech (Hons) in Civil Engineering from the University of Mauritius, an MSc in Environmental Engineering with distinction from Newcastle University (UK) and an MBA in Global Sustainable Management from Anaheim University (California). He has 20 years of experience in the environmental field, including waste management, industrial-effluent treatment, biogas valorisation, and the implementation of quality management, environmental management and other management systems in the industry. Mr Ramlugon is also a member of the Global Association of Corporate Sustainability Officers (GACSO) and an Affiliate Member of the Institute of Environmental Management & Assessment (UK).

Oudesh SEEBARUTH HEAD OF CORPORATE FINANCE & TREASURY –––––––––––––––––––––––––––––––––––––––––––––––––Oudesh Seebaruth is a Fellow of the Chartered Institute of Management Accountants (CIMA) and a Chartered Global Management Accountant (CGMA). He started his career in accounting and audit with Deloitte in 1984 and joined the Company in 1989. He was promoted to financial accountant in 1994 and then to his current position in 2007. He has extensive experience in financial reporting, risk management, mergers and acquisitions, treasury management and project financing.

Rudley LUTCHMANENGROUP FINANCE MANAGER –––––––––––––––––––––––––––––––––––––––––––––––––Rudley Lutchmanen is a fellow member of the Association of Chartered Certified Accountants (ACCA) and holds an MSc degree in Finance. He started his career in the Assurance Department of Ernst & Young before joining the company in 2004. He has more than 20 years of experience in auditing, financial reporting and treasury management.

Hahmid SEELARBOKUS GROUP HUMAN RESOURCES MANAGER –––––––––––––––––––––––––––––––––––––––––––––––––Hahmid Seelarbokus holds a bachelor’s degree in Administration from the University of Mauritius and a master’s degree in Business Administration from Queensland University of Technology (Australia). He has 29 years of experience in administrative and human resources management.

Maurice REGNARD CHIEF PROCUREMENT OFFICER –––––––––––––––––––––––––––––––––––––––––––––––––Maurice Regnard is a member of the Chartered Institute of Procurement & Supply. He has some 30 years of experience in trading in various sectors. His career covers petroleum distribution operations, real estate, chemicals, manufacturing, international trade, and procurement. Mr Regnard has held management positions for 15 years, including an expatriation in Madagascar for more than 5 years, during which he sharpened his negotiation and leadership skills.

Avinash DOOKHUN IT MANAGER –––––––––––––––––––––––––––––––––––––––––––––––––Avinash Dookhun holds an MBA from the University of Mauritius, a Honours degree in Information Technology from the British Computer Society (BCS) (UK) and a Brevet de Technicien en Electrotechnique from Lycée Polytechnique Sir Guy Forget (Mauritius). He has also completed professional certifications from Microsoft, Hewlett-Packard and The City & Guilds of London Institute and is a registered member of the BCS. He has 25 years of work experience in IT.

Navin MOHUN INTERNAL AUDIT MANAGER –––––––––––––––––––––––––––––––––––––––––––––––––Navin Mohun is a Certified Internal Auditor (CIA) from the Institute of Internal Auditors, a Fellow Member of the Association of Chartered Certified Accountants (FCCA). He also holds a BSc in Accounting and Finance from the University of Mauritius. He started his career in the Audit Department of Deloitte before joining the Company in 2005. He has 14 years of experience in internal and external auditing.

Jean-François LOUMEAU GROUP PROJECT AND DEVELOPMENT EXECUTIVE –––––––––––––––––––––––––––––––––––––––––––––––––Jean-François Loumeau holds an MBA in Construction and Real Estate from Reading University (UK) and a bachelor’s degree in Mechanical Engineering from the University of Cape Town (South Africa). He has also been awarded a postgraduate certificate in The Mechanics of Project Finance from Middlesex University. He is a registered engineer with the Engineering Council of South Africa and is an Associate Member of the South African Institute of Mechanical Engineering. He has 26 years of working experience in engineering and project management.



Key Executives’Profiles (cont’d)

Kevin PADIACHY INDUSTRIAL DEVELOPMENT MANAGER – AFRICA DESK –––––––––––––––––––––––––––––––––––––––––––––––––Kevin Padiachy holds a B.Eng (Hons) degree in Chemical & Environmental Engineering, a postgraduate diploma in International Business Management and a master’s degree in Business Administration from the University of Mauritius. He also holds a postgraduate certificate in The Mechanics of Project Finance from Middlesex University. He has 16 years of work experience in regional trade as well as in energy and environmental management in the fields of process, sugar, power generation and textile.

Christophe BARBÈS POUGNETHEAD OF LEGAL SERVICES AND PROJECT FINANCE–––––––––––––––––––––––––––––––––––––––––––––––––Christophe Barbès Pougnet is Omnicane’s Head of Legal Services and Project Finance since July 2017. Before joining the Group, he worked as Project Finance Leader at the Mauritius Commercial Bank Ltd, where he spent twelve years in the corporate banking and project financing sectors. Christophe holds a BCom in Financial Management from the University of South Africa, a professional diploma in treasury delivered by the Association of Corporate Treasurers (UK), and an LLM (Master of Laws) from Université Panthéon-Assas (Paris

Peter L.M. HOUGHSUGAR DEVELOPMENT EXECUTIVE–––––––––––––––––––––––––––––––––––––––––––––––––Peter Hough joined Omnicane in 2015. He has spent almost all of his career in the sugar industry, mainly in trading and sales and in management roles at Board level. He has developed business activities in sourcing sugar from around the world for sale in the EU and he is well-known for reporting on both the EU and global sugar markets.

MILLING OPERATIONS

Jean Luc CABOCHEOPERATIONS EXECUTIVE – MILLING –––––––––––––––––––––––––––––––––––––––––––––––––Jean Luc Caboche holds an MBA in Business Administration from the Heriot-Watt University (UK) and has 27 years of supervisory and management experience in maintenance and factory operations.

Lindsay DAVY OPERATIONS EXECUTIVE – REFINERY–––––––––––––––––––––––––––––––––––––––––––––––––Lindsay Davy holds a Diploma in Agriculture and Sugar Technology, a BSc in Sugar Engineering and an MSc in Project Management from the University of Mauritius. He has more than 31 years of experience in the sugar industry, in process management and as a chemist.

THERMAL ENERGY OPERATIONS

Jean Michel GÉRARDGENERAL MANAGER – LA BARAQUE POWER PLANT–––––––––––––––––––––––––––––––––––––––––––––––––Jean Michel Gérard joined Omnicane Thermal Energy Operations (La Baraque) in 2018 and has considerable experience in the management of power plants. After working for the French navy for 15 years, he continued his career for the last 20 years with the Séchilienne-Sidec Group, an independent power producer.

Frédéric ROBERTPOWER PLANT MANAGER – ST AUBIN–––––––––––––––––––––––––––––––––––––––––––––––––Frédéric Robert is an experienced power plant specialist with 19 years of experience in the management of thermal power plants.

AGRICULTURAL OPERATIONS

François VITRY AUDIBERTCHIEF OPERATIONS OFFICER – AGRICULTURE–––––––––––––––––––––––––––––––––––––––––––––––––As Chief Operations Officer, François Vitry Audibert manages the agricultural operations of Omnicane. Having 39 years of experience in the sugar industry within our Group, he is fully conversant with sugarcane farming and food crop production practices.

BIO-ETHANOL OPERATIONS

Jean-Pierre ROUILLARDGENERAL MANAGER – DISTILLERY–––––––––––––––––––––––––––––––––––––––––––––––––Jean-Pierre Rouillard holds a Diploma in Management (Surrey, UK) and has 30 years of experience in production management across different fields. He has broad experience of the industrial sector in Mauritius and Omnicane Bio-Ethanol Operations Limited in 2013.

HOLIDAY INN MON TRÉSOR

Jean-Laurent ASTIERGENERAL MANAGER – HOLIDAY INN MON TRÉSOR–––––––––––––––––––––––––––––––––––––––––––––––––Jean-Laurent Astier studied at the reputable Glion Institute of Higher Education in Switzerland. He landed his first job as Head of Stewarding at Hotel Martinez in Cannes. He then took employment as Assistant Director with Société des Bains de Mer in Monaco. He came to Mauritius in the mid-nineties to work as Resident Manager at Ambre Hotel (Apavou Group). Afterwards, he spent four years at DCDM as Hospitality Consultant where he dealt with customers in the African region. Mr Astier briefly worked at the Sofitel Imperial Hotel in Mauritius before returning to France as Director for an Accor Group hotel with thalassotherapy facilities. He came back in 2003 as General Manager of Alizée Resort Management (Cardinal Exclusive Resort) prior to joining Holiday Inn Mon Trésor in July 2016.

PROPERTY DEVELOPMENT

Joël BRUNEAUHEAD OF PROPERTY DEVELOPMENT–––––––––––––––––––––––––––––––––––––––––––––––––Joël Bruneau joined Omnicane in 2011. He has a total of 20 years of management experience after working in three main lines of business, with 10 years in senior management positions at IBL and Medine Ltd, among others. He obtained an MBA with distinction from the University of Birmingham, UK after completing his BCom degree in South Africa.

Jean-Paul TOSTÉESALES & DEVELOPMENT EXECUTIVE–––––––––––––––––––––––––––––––––––––––––––––––––Jean-Paul Tostée joined Mon Trésor Smart City Ltd in November 2018. In addition to 11 years of experience with market-leading real estate companies in London, Johannesburg and Cape Town, he has five years of experience in the hospitality industry within these countries. Mr Tostée is certified as a National Real Estate Principal with a South African National Qualifications Framework (NFQ) Level 5 Principal Qualification.

LOGISTIC OPERATIONS

Fabien DE GUARDIA DE PONTELOGISTIC OPERATIONS MANAGER–––––––––––––––––––––––––––––––––––––––––––––––––Fabien de Guardia de Ponte holds a French Baccalaureate in Economic and Social Sciences. He has a Certificate in Business Development and a Diploma in Business Management. He started his career in the construction field, then joined Velogic Depot and Workshop as Operations Manager in late 2008. Mr de Guardia de Ponte was promoted Senior Manager in 2015, taking the lead of the Transport and Garage entities. He joined Omnicane Logistics Operations Ltd in December 2017.


Statutory DisclosuresYear ended December 31, 2018(Pursuant to Section 221 of the Companies Act 2001)


Nature of BusinessThe principal activities of the Group are electricity, raw sugar, refined sugar, ethanol production, hospitality, property development and logistics while the Company is engaged in sugar cane, other food crops cultivation and investment activities.

DirectorsThe persons who held office as Directors of the Company as at December 31, 2018 are:

Didier MAIGROT (Chairman)Jacques MARRIER D’UNIENVILLE (Chief Executive Officer), GOSKNelson MIRTHILBertrand THEVENAUMarc HEIN, SC, GOSKPierre MARRIER D’UNIENVILLEThierry MERVENPreetam BOODHUNSachin Kumar SUMPUTH (resigned on October 9, 2018)Bojrazsing BOYRAMBOLI (resigned on May 5, 2018)Valentine LAGESSEJimmy TONG SAM (appointed on June 26, 2018)Koosiram CONHYE (appointed on June 26, 2018)

The Directors of the subsidiaries are disclosed in the Corporate Governance Report.

Contracts of SignificanceDuring the year under review, there were no contracts of significance to which Omnicane Limited, or any of its subsidiaries, was a party and in which a director of Omnicane Limited was materially interested, either directly or indirectly.

The company has a management contract with Omnicane Management and Consultancy Limited, a wholly-owned subsidiary of the controlling shareholder, Omnicane Holdings Limited.

Service ContractsNone of the directors of the Company have service contracts with the Company or with any of its subsidiaries.

Remuneration and Benefits Remuneration and benefits received from the Company and its subsidiaries were:

Details are provided in the Corporate Governance Report.

COMPANY SUBSIDIARIES

Directors of Omnicane Limited 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Executive Directors (Full-time) 2 (2017: 2) 716 693 324 482

Non-Executive Directors 9 (2017: 9) 3,258 2,807 75 807

Directors of Subsidiaries 2018Rs’000

2017Rs’000

Executive Directors (Full-time) 8 (2017: 8) 750 965

Non-Executive Directors 8 (2017: 8) 451 591

Directors and Senior Officers’ Interests The Company’s directors and senior officers’ interests in the Company at December 31, 2018 were as follows:

DIRECT INDIRECT

Shares % Shares %

Marc HEIN, SC, GOSK 44,990 0.0671 29,975 0.0225

Jacques MARRIER D’UNIENVILLE, GOSK 67,000 0.10 - -

Pierre MARRIER D’UNIENVILLE - - 14,000 0.01

The Group’s CSR contribution to Omnicane Foundation amounted to Rs 1,777,648 during the year (2017: Rs 3,453,411).

GROUP COMPANY

Donations 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Charitable - - - -

Political - - - -


Certificate ofCompany SecretaryDecember 31, 2018


I certify to the best of my knowledge and belief that the Company has filed with the Registrar of Companies all such returns as are required of the Company under Section 166(d) of the Companies Act 2001.

Eddie AH-CHAM, FCCAfor Omnicane Management & Consultancy LimitedSECRETARIES


StatutoryDisclosures Year ended December 31, 2018(Pursuant to Section 221 of the Companies Act 2001) (cont’d)

Approved by the Board of Directors on March 29, 2019 and signed on its behalf by:

Preetam BOODHUN Jacques M. D’UNIENVILLE, GOSKCHAIRPERSON, AUDIT COMMITTEE CHIEF EXECUTIVE OFFICER

Major Shareholders of the CompanyShareholders holding more than 5% of the issued share capital are:

Number of shares held % Holding

Omnicane Holdings Limited 47,074,792 70.2479

National Pensions Fund 6,756,983 10.0832

GROUP COMPANY

Fees Payable to Auditors 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Audit fees:BDO & Co. 3,042 2,856 828 802

Fees paid for other services:BDO & Co. - 300 - 300


Statement of Directors’ Responsibilities


Responsibilities in Matters of Financial StatementCompany law requires the Directors to prepare financial statements for each financial year, which present fairly the financial position, financial performance, changes in equity, and cash flows of the Company and its subsidiaries. In preparing those financial statements, the Directors are required to:

• keep adequate accounting records;

• select suitable accounting policies and estimates and then apply them consistently;

• make judgments and estimates that are reasonable and prudent;

• state whether International Financial Reporting Standards have been followed and complied with, subject to any material departures being disclosed and explained in the notes to financial statements; and

• prepare the financial statements on a going-concern basis unless it is inappropriate to presume that the Company and any of its subsidiaries will continue in business.

The Directors confirm that they have complied with the above requirements in preparing the financial statements. The Directors also confirm that most of the requirements of the Code of Corporate Governance 2016 has been adhered to. Reasons have been provided where there has not been compliance. The Directors are responsible for safeguarding the assets of the Company and the Group, and hence for the implementation and operation of accounting and internal control systems that are designed to prevent and detect fraud and errors, and of an effective risk management system.

The Internal Audit Manager works according to an Internal Audit Plan which aims at covering over a period of time all operations of the Company and its subsidiaries by effecting regular visits on site, verifying that management controls and procedures are in place and followed and providing corrective measures where weaknesses are detected.

The Internal Audit Manager writes a report on investigations, findings and recommendations after each site visit. At each meeting of the Audit Committee, which usually precedes a Board meeting, the Internal Audit Manager tables reports that are considered and approved by the Audit Committee. At the next Board meeting, the Chairperson of the Audit Committee apprises the Board on the workings of the Internal Audit Department.

The Group’s external auditors, BDO & Co., have full access to the Board of Directors and its committees and discuss the audit as well as matters arising therefrom, such as their observations on the fairness of financial reporting and the adequacy of internal controls. The external auditors are responsible for reporting on whether the Financial Statements are fairly presented.

Preetam BOODHUN Jacques M. D’UNIENVILLE, GOSKCHAIRPERSON, AUDIT COMMITTEE CHIEF EXECUTIVE OFFICER

Bertrand THEVENAUNon-Executive Director

D E V E L O P M E N T I N T H E S O U T H

Our industrial cane cluster at La Baraque is often mentioned in international forums as a showcase model of Sustainability. We are wholeheartedly commited to pioneer an inclusive and harmonious development in the South of the country.”

Our industrial cane cluster at La Baraque

“

“The South of the Island has been so far somewhat lagging behind compared to other regions of our country.

Omnicane as a major operator in this region, has a unique opportunity to play an active role. Our engagement on the Sustainability Journey is known by all and our collaboration with all stakeholders is permanent. In all our new projects, we do have consultations with local communities and authorities, and, we give priority of employment to inhabitants of neighbouring villages.

We have recently moved in our brand new ‘Green’ Headquarters next to the airport which bears testimony of our commitment to the South. We intend to promote an integrated development where environment will stand as a pillar.”


ConsolidatedFinancial

Statements

08


Report on the Audit of the Financial Statements

OpinionWe have audited the consolidated financial statements of Omnicane Limited and its subsidiaries (the Group), and the Company’s separate financial statements on pages 137 to 215 which comprise the statements of financial position as at December 31, 2018, and the statements of profit or loss and other comprehensive income, statements of changes in equity and statements of cash flows for the year ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the financial statements on pages 137 to 215 give a true and fair view of the financial position of the Group and of the Company as at December 31, 2018, and of their financial performance and their cash flows for the year ended in accordance with International Financial Reporting Standards and comply with the Companies Act 2001.

Basis for OpinionWe conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group and of the Company in accordance with the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (IESBA Code) together with the ethical requirements that are relevant to our audit of the financial statements in Mauritius, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the IESBA Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit MattersKey audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the current period. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

IndependentAuditors’ Reportto the Shareholders of Omnicane Limited

THE GROUP AND THE COMPANY

KEY AUDIT MATTER AUDIT RESPONSE

1. Investments

Valuation of Investments

At December 31, 2018, investments amounted to Rs 1.2 billion for the Group and Rs 5.8 billion for the Company. This amount is made up of investment in subsidiaries, associates and financial assets at fair value through other comprehensive income. The main risks identified are related to the high value of the items. There is also a risk of impairment which needs to be assessed.

The investment in the milling entity has been tested for impairment based on future cash flows. The main risks identified are related to the assumptions of key inputs used in the forecasts.

In response to these risks, our audit procedures included:

The review of the valuation methods used and discussed with Management in respect of the reasonableness of basis and assumptions they have used.

The verification of the forecasted results of subsidiaries and substantiation of the forecasts based on historical information.

Given the uncertainty on certain key inputs in the future cashflow, we have relied on Management representation.

Refer to notes 17, 18, 19 and 20 of the accompanying financial statements.



2. Non-Current & Current Receivables

Non-Current & Current Receivables for year ended December 31, 2018 totalled Rs 5.9 billion for the Company and Rs 3.7 billion for the Group. The main risks identified relate to the high value of the items and their recoverability and the proper application of IFRS 9 to these receivables.

Our audit procedures included:

• The review of management’s evaluation on the recoverability of these receivables and substantiation of cash flow projections relied upon by management.

• The assessment of the design and implementation of key controls around the monitoring of recoverability.

• We have evaluated relevance of Expected Credit Losses (ECL) computed under IFRS 9 and discussed with Management to ensure that there is no evidence of Management bias during the selection of forward-looking economic scenarios and forward-looking indicators of changes in credit risk used for the computation of the ECL.

Refer to notes 21, 22, 26 and 27 of the accompanying financial statements.



3. Borrowings

At December 31, 2018, borrowings amounted to Rs 11 billion for the Group and Rs 6.5 billion for the Company. The main risks identified relate to the high risk value of the items and their repayment.

We have obtained confirmations from the Group’s banks to confirm all significant borrowings, including amounts, tenure and conditions.

We have read the most up-to-date agreements between Omnicane Limited Group and its financiers to understand the terms associated with the facilities and the amount of facility available for drawdown.

Where debt is regarded as non-current, we tested whether the Group has the unconditional right to defer payment such that there were no repayments required within 12 months from the balance date.

Refer to note 31 of the accompanying financial statements.

08 / Consolidated Financial Statements


IndependentAuditors’ Reportto the Shareholders of Omnicane Limited (cont’d)



4. Property, Plant and Equipment (PPE)

Valuation of Land Valuation

As set out in the critical accounting estimates and judgements on pages 162 and 163, and in the notes on pages 170 to 175 of the financial statements, the Group measures its land at fair value and this represents a significant accounting estimate.

PPE assets are measured initially at cost, with land subsequently measured at fair value. Valuations are performed by an independent professionally accredited expert, in accordance with the Royal Institute of Chartered Surveyors (RICS) Appraisal and Valuation Manual, and performed with sufficient regularity to ensure that the carrying value is not materially different from fair value at the Statement of Financial Position date.

The main risks identified are related to the involvement of a range of judgemental assumptions. PPE is valued at Rs 16.7 billion for the Group and Rs 5.3 billion for the Company in the Statements of Financial Position as at December 31, 2018.

We have assessed the credentials of the independent property valuer.

We have assessed the assumptions used in the valuation report submitted by the independent property valuer.

We have confirmed that the valuation was correctly accounted for and disclosed in the financial statements.




5. Valuation of Bearer Biological Assets

At December 31, 2018, the Group’s and the Company’s bearer biological assets amounted to Rs 142 million and Rs 105 million respectively. Those bearer biological assets have been tested for impairment based on future cash flows. The main risks identified are related to the assumptions of key inputs used in the forecasts.

Given the uncertainty on certain key inputs in the future cash flows, we have relied on Management representation.


Other InformationThe Directors are responsible for the other information. The other information comprises the information included in the statutory disclosures, but does not include the financial statements and our auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Corporate Governance Report

Our responsibility under the Financial Reporting Act is to report on the compliance with the Code of Corporate Governance disclosed in the annual report and assess the explanations given for non-compliance with any requirement of the Code. From our assessment of the disclosures made on corporate governance in the annual report, the public interest entity has, pursuant to section 75 of the Financial Reporting Act, complied with the requirements of the Code.

Responsibilities of Directors and Those Charged with Governance for the Financial StatementsThe directors are responsible for the preparation and fair presentation of the financial statements in accordance with International Financial Reporting Standards and in compliance with the requirements of the Companies Act 2001, and for such internal control as the directors determine is necessary to enable the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the Group and the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Group and the Company or to cease operations, or have no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the Group and the Company’s financial reporting process.

Auditor’s Responsibilities for the Audit of the Financial StatementsOur objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with ISAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group and the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by directors.

• Conclude on the appropriateness of directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group and the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.



IndependentAuditors’ Report (cont’d)

to the Shareholders of Omnicane Limited

Auditor’s Responsibilities for the Audit of the Financial Statements (cont’d)

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory RequirementsCompanies Act 2001 We have no relationship with, or interests in, the Company or any of its subsidiaries, other than in our capacity as auditors, business advisers and dealings in the ordinary course of business.

We have obtained all information and explanations we have required.

In our opinion, proper accounting records have been kept by the Company as far as it appears from our examination of those records.

Other MatterThis report is made solely to the members of Omnicane Limited (the “Company”), as a body, in accordance with Section 205 of the Companies Act 2001. Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

BDO & CO. Yacoob RAMTOOLA, FCACHARTERED ACCOUNTANTS LICENSED BY FRC

Port Louis, Mauritius

March 29, 2019


THE GROUP THE COMPANY

Notes 2018

Rs’000

2017 Restated Rs’000

2018 Rs’000


Revenue 2.2/5 4,245,171 4,539,150 217,348 219,375Loss in fair value of consumable biological assets 25 (2,164) (61,602) (1,692) (48,796)Other operating income 6 44,411 21,728 3,013 3,313

4,287,418 4,499,276 218,669 173,892 Operating expenses 7 (4,263,474) (4,330,091) (455,983) (473,830)Net impairment losses on financial assets 21(b(i)) - - (64) -Operating profit/(loss) 8 23,944 169,185 (237,378) (299,938)Investment income 9 156,149 121,576 518,315 512,117Finance costs 10 (632,268) (556,971) (388,517) (373,595)Other non-operating income/(expense) 11 128,360 (22,810) 128,360 (22,810)Share of loss in associates 18 (1,953) (155,950) - -(Loss)/profit before exceptional items (325,768) (444,970) 20,780 (184,226)Exceptional items 12 - 212,597 (39,054) 79,696Loss before taxation (325,768) (232,373) (18,274) (104,530)Income tax (charge)/credit 13(a) (76,562) (94,193) (6,428) 4,709Loss for the year (402,330) (326,566) (24,702) (99,821)

Other comprehensive income:Items that may be reclassified subsequently to profit or loss:Changes in fair value of available for sale financial assets 20 - 29,006 - 4Changes in fair value of equity instruments at fair value through other comprehensive income 19 (85,067) - 3 -

Cash flow hedge 2.4 33,133 (1,639) - -Land Conversion Rights 2.6/30 - 211,837 - 211,837Revaluation (deficit)/surplus on land 15 (850) 2,558,707 - 647,457Currency translation differences - (10,841) - -Items that will not be reclassified to profit or loss:Remeasurements of retirement benefit obligations 32 21,545 (21,566) 9,918 (11,876)Income tax relating to remeasurements of defined benefit obligations 23 (1,996) 2,054 (1,686) 1,781Share of other comprehensive income of associates 18 - 16,336 - -Other comprehensive income for the year, net of tax (33,235) 2,783,894 8,235 849,203Total comprehensive income for the year (435,565) 2,457,328 (16,467) 749,382Loss attributable to:Owners of the parent (413,716) (422,802) (24,702) (99,821)Non-controlling interests 11,386 96,236 - -

(402,330) (326,566) (24,702) (99,821)Total comprehensive income attributable to:Owners of the parent (458,057) 2,347,796 (16,467) 749,382Non-controlling interests 22,492 109,532 - -

(435,565) 2,457,328 (16,467) 749,382Loss per share (Rs.) 14 (6.17) (6.28) (0.37) (1.49)

The notes on pages 143 to 215 form an integral part of these financial statements. Auditor’s report on pages 132 to 136.

Statements of Profit or Lossand Other Comprehensive Income – Year ended December 31, 2018




Notes2018

Rs’000

2017 RestatedRs’000

As at Jan 1, 2017RestatedRs’000

2018 Rs’000


As at Jan 1, 2017

Restated Rs’000

ASSETS EMPLOYEDNon-current assetsProperty, plant and equipment 15 16,697,307 16,651,091 14,230,451 5,339,916 5,289,848 4,630,811Intangible assets 16 1,785,649 1,807,781 1,655,662 344,360 354,350 256,809Investments in subsidiary companies 17 - - - 5,008,607 4,947,661 4,946,561Investments in associates 18 79,844 964,672 1,060,957 5,287 11,463 11,463Financial assets at fair value through other comprehensive income 19 1,093,116 - - 800,836 - -

Investments in financial assets 20 - 298,956 271,710 - 4,481 6,237Financial assets at amortised cost 21 1,063,273 - - 1,567,716 - -Non-current receivables 22 - 1,177,955 1,027,839 - 1,285,050 1,167,670Deferred tax assets 23 75,894 93,639 120,717 18,045 26,159 19,669

20,795,083 20,994,094 18,367,336 13,084,767 11,919,012 11,039,220Current assetsInventories 24 721,616 780,392 742,083 8,571 9,719 9,087Consumable biological assets 25 56,127 58,291 118,465 37,141 38,833 87,629Receivable from related parties 26 - 993,324 710,033 - 4,582,181 3,932,016Trade and other receivables 27 521,073 1,642,798 2,570,770 39,495 625,828 1,325,711Other financial assets at amortised cost 21 2,086,269 - - 4,320,159 - -Current tax assets 13(b) 19,589 20,256 24,619 388 388 2,852Cash and cash equivalents 37(e) 218,126 387,644 533,015 12,326 54,788 56,869

3,622,800 3,882,705 4,698,985 4,418,080 5,311,737 5,414,164Non-current assets classified as held for sale 28 39,490 45,842 68,753 26,597 32,949 55,860

Total assets 24,457,373 24,922,641 23,135,074 17,529,444 17,263,698 16,509,244

EQUITY AND LIABILITIESCapital and reservesShare capital 29 502,593 502,593 502,593 502,593 502,593 502,593Share premium 292,450 292,450 292,450 292,450 292,450 292,450Revaluation and other reserves 30 8,511,945 8,561,953 6,192,350 5,122,993 5,119,709 5,499,947Retained earnings 623,296 1,607,995 1,763,827 3,781,157 4,457,178 3,461,583Owners’ interests 9,930,284 10,964,991 8,751,220 9,699,193 10,371,930 9,756,573Non-controlling interests 976,290 1,033,896 1,040,364 - - -Total equity 10,906,574 11,998,887 9,791,584 9,699,193 10,371,930 9,756,573

Statements of Financial PositionDecember 31, 2018



Notes2018

Rs’000

2017 RestatedRs’000

As at Jan 1, 2017

RestatedRs’000

2018 Rs’000


As at Jan 1, 2017Restated Rs’000

LIABILITIESNon-current liabilitiesBorrowings 31 7,829,896 8,005,438 6,382,865 4,725,780 4,413,246 2,264,090Deferred tax liabilities 23 374,242 342,725 302,525 - - -Retirement benefit obligations 32 442,842 433,046 387,930 254,613 243,712 217,385

8,646,980 8,781,209 7,073,320 4,980,393 4,656,958 2,481,475Current liabilitiesPayable to related parties 33 132,397 133,206 177,872 544,031 57,928 64,766Trade and other payables 34 1,518,792 1,029,005 1,191,305 516,601 190,251 239,928Current tax liabilities 13(b) 5,531 5,347 14,131 - - -Borrowings 31 3,175,898 2,786,536 4,690,833 1,772,426 1,852,606 3,832,477Blue print costs 35 54,401 54,426 62,004 - - -Dividends payable 36 16,800 134,025 134,025 16,800 134,025 134,025

4,903,819 4,142,545 6,270,170 2,849,858 2,234,810 4,271,196Total equity and liabilities 24,457,373 24,922,641 23,135,074 17,529,444 17,263,698 16,509,244

The financial statements have been approved for issue by the Board of Directors on: March 29, 2019


Preetam Boodhun CHAIRPERSON, AUDIT COMMITTEE

Jacques M. d’Unienville, GOSK CHIEF EXECUTIVE OFFICER


Attributable to owners of the parent

THE GROUPNotes

Share capital Rs’000

Share premium Rs’000

Revaluation and other reserves Rs’000

Retained earnings Rs’000

Owners’ interest Rs’000

Non-controlling interests Rs’000

Total equity Rs’000

Balance at January 1, 2018- As previously reported 502,593 292,450 8,561,991 1,622,774 10,979,808 1,050,023 12,029,831- Effect of prior year adjustments 45(d) (38) (14,779) (14,817) (16,127) (30,944)- Effect of changes in accounting

policies 45(a) - - - (588,826) (588,826) 5,934 (582,892)

- As restated 502,593 292,450 8,561,953 1,019,169 10,376,165 1,039,830 11,415,995Total comprehensive income for the year:- (Loss)/profit for the year - - - (413,716) (413,716) 11,386 (402,330)- Other comprehensive income for

the year - - (44,341) - (44,341) 11,106 (33,235)

Transfer to retained earnings - - (5,667) 5,667 - - -Consolidation adjustment - - - 12,176 12,176 3,968 16,144 Dividends - - - - - (90,000) (90,000)Balance at December 31, 2018 502,593 292,450 8,511,945 623,296 9,930,284 976,290 10,906,574

Balance at January 1, 2017- As previously stated 502,593 292,450 6,192,395 1,779,394 8,766,832 1,054,600 9,821,432- Effect of prior year adjustments 45(d) - - (45) (15,567) (15,612) (14,236) (29,848)- As restated 502,593 292,450 6,192,350 1,763,827 8,751,220 1,040,364 9,791,584Total comprehensive income for the year: -

- (Loss)/profit for the year - - - (422,802) (422,802) 96,236 (326,566)- Other comprehensive income

for the year - - 2,770,598 - 2,770,598 13,296 2,783,894

Transfer to retained earnings - - (400,995) 400,995 - - -Dividends 36 - - - (134,025) (134,025) (116,000) (250,025)Balance at December 31, 2017 502,593 292,450 8,561,953 1,607,995 10,964,991 1,033,896 11,998,887


THE COMPANYNotes

Share capital Rs’000

Share premium Rs’000

Revaluation and other reserves

Rs’000

Retained earnings Rs’000

Total Rs’000

Balance at January 1, 2018- As previously reported 502,593 292,450 5,119,709 4,454,100 10,368,852- Effect of prior year adjustments 45 - - - 3,078 3,078 - Effect of changes in accounting policies 45 - - - (656,270) (656,270)- As restated 502,593 292,450 5,119,709 3,800,908 9,715,660Total comprehensive income for the year:- Loss for the year - - - (24,702) (24,702)- Other comprehensive income - - 8,235 - 8,235 Transfer to retained earnings - - (4,951) 4,951 -Balance at December 31, 2018 502,593 292,450 5,122,993 3,781,157 9,699,193

Balance at January 1, 2017- As previously reported 502,593 292,450 5,499,947 3,459,269 9,754,259- Effect of prior year adjustments 45 - - - 2,314 2,314- As restated 502,593 292,450 5,499,947 3,461,583 9,756,573Total comprehensive income for the year:- Loss for the year - - - (99,821) (99,821)- Other comprehensive income - - 849,203 - 849,203Transfer to retained earnings - - (1,229,441) 1,229,441 -Dividends 36 - - - (134,025) (134,025)Balance at December 31, 2017 502,593 292,450 5,119,709 4,457,178 10,371,930



Statements of Changes in EquityYear ended December 31, 2018


Statements of Cash FlowsYear ended December 31, 2018

THE GROUP THE COMPANY Notes

2018 Rs’000

2017 Rs’000

2018 Rs’000

2017 Rs’000

Cash generated from/(absorbed by) operating activitiesOperating profit/(loss) before working capital changes 37(a) 736,775 766,053 (183,591) (236,140)Working capital requirements 37(b) (8,103) (208,384) (279,670) (550,476)

728,672 557,669 (463,261) (786,616)Interest paid (635,555) (643,354) (375,623) (360,129)Net tax paid 13(b) (29,635) (29,282) - -Tax refund 13(b) - - - 2,464Net cash from/(used in) operating activities 63,482 (114,967) (838,884) (1,144,281)Cash flows from investing activitiesPurchase of property, plant and equipment 15(g) (636,180) (406,503) (97,937) (36,576)Purchase of intangible assets 16 (9,890) (31,812) (162) (27,448)Purchase of biological assets - (1,428) - -Loans to subsidiary company - - - (117,380)Expenditure on land under development (184,753) (250,878) (184,753) (250,878)Proceeds from sale of land 433,315 773,483 433,315 773,483Proceeds from sale of management contract - 314,499 - 255,700Proceeds from sale of plant and equipment 32,444 8,892 3,932 1,728Disposals of financial assets at fair value through other comprehensive income 1,662 - 1,662 -

Expenditure on Blue Print costs (25) (7,578) - -Interest received 151,362 116,816 398,450 335,291Dividends received from subsidiary companies - - 134,450 176,800Dividends received from available-for-sale financial assets 4,787 4,760 - 26Net cash (used in)/from investing activities (207,278) 520,251 688,957 1,110,746Cash flows from financing activitiesDividends paid to company’s shareholders 36 (117,225) (134,025) (117,225) (134,025)Dividends paid to minority shareholders (90,000) (116,000) - -Payments of long-term and short-term borrowings (1,056,024) (3,339,856) (449,253) (2,723,004)Finance lease principal payments (30,909) (30,946) (8,525) (7,608)Proceeds from long-term and short-term borrowings 1,224,215 2,126,439 744,015 1,980,350Repayment of bond - (1,080,000) - (1,080,000)Proceeds from private placement - 2,500,000 - 2,500,000Proceeds from loan from related party 75,274 - - -Net cash from/(used in) financing activities 5,331 (74,388) 169,012 535,713Net (decrease)/increase in cash and cash equivalents (138,465) 330,896 19,085 502,178

At January 1, (1,042,816) (1,393,498) (1,142,110) (1,654,764)(Decrease)/increase (138,465) 330,896 19,085 502,178Effect of foreign exchange rate changes (22,443) 19,786 (148) 10,476At December 31, 37(e) (1,203,724) (1,042,816) (1,123,173) (1,142,110)



Notes to the Financial StatementsYear ended December 31, 2018


1. GENERAL INFORMATION

Omnicane Limited is a public limited liability company incorporated and domiciled in Mauritius. The address of its registered office is Omnicane House, Mon Trésor Business Gateway, New Airport Access Road, Plaine Magnien.

These financial statements will be submitted for consideration and approval at the forthcoming Annual Meeting of Shareholders of the Company.

2. SIGNIFICANT ACCOUNTING POLICIES

The principal accounting policies adopted in the preparation of these financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparationThe financial statements of Omnicane Limited and its subsidiaries comply with the Companies Act 2001 and have been prepared in accordance with International Financial Reporting Standards (IFRS). The financial statements include the consolidated financial statements of the parent company and its subsidiary companies (The Group) and the separate financial statements of the parent company (The Company). The consolidated financial statements are presented in Mauritian rupees and all values are rounded to the nearest thousand (Rs’000), except where otherwise indicated.

Where necessary, comparative figures have been amended to conform with changes in presentation in the current year. The financial statements are prepared under the historical cost convention, except that:(i) land is carried at revalued amount;(ii) available-for-sale investments are stated

at fair value and(iii) investments held for trading and relevant

financial assets and financial liabilities are stated at their fair value;

(iv) relevant financial assets and financial liabilities are carried at amortised cost; and

(v) consumable biological assets are stated at fair value.

Standards, Amendments to published Standards and Interpretations effective in the reporting period

IFRS 9 replaces the provisions of IAS 39 that relate to the recognition, classification and measurement of financial assets and financial liabilities, derecognition of financial instruments, impairment of financial assets and hedge accounting. The adoption of IFRS 9 Financial Instruments from January 1, 2018 resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. The new accounting policies are set out in note 2.9. The Group has elected to apply the exemption in IFRS 9 paragraph 7.2.15 not to restate prior periods in the year of initial application of the standard. The Group has chosen to adopt the simplified expected credit loss model for trade receivables in accordance with IFRS 9 paragraph 5.5.15.

IFRS 15 Revenue from Contracts with Customers is based on the principle that revenue is recognised when control of a good or service transfers to a customer. The group has adopted IFRS 15 Revenue from Contracts with Customers from January 1, 2018 which resulted in changes in accounting policies and adjustments to the amounts recognised in the financial statements. The new accounting policies are set out in note 2.2. In accordance with the transition provisions in IFRS 15, the group has not restated comparatives for the 2017 financial year.

Classification and Measurement of Share-based Payment Transactions (Amendments to IFRS 2)The amendments clarify the measurement basis for cash-settled share-based payments and the accounting for modifications that change an award from cash-settled to equity-settled. The amendment has no impact on the Group’s financial statements.


2. SIGNIFICANT ACCOUNTING POLICIES (cont’d)

2.1 Basis of preparation (cont’d)

Standards, Amendments to published Standards and Interpretations effective in the reporting period (cont’d)

Applying IFRS 9 Financial Instruments with IFRS 4 Insurance Contracts (Amendments to IFRS 4)The amendment provides two different solutions for insurance companies: a temporary exemption from IFRS 9 for entities that meet specific requirements (applied at the reporting entity level), and the ‘overlay approach’. Both approaches are optional. The amendment has no impact on the Group’s financial statements.

Annual Improvements to IFRSs 2014-2016 Cycle

• IFRS 1 - deleted short-term exemptions covering transition provisions of IFRS 7, IAS 19 and IFRS 10 which are no longer relevant.

• IAS 28 - clarifies that the election by venture capital organisations, mutual funds, unit trusts and similar entities to measure investments in associates or joint ventures at fair value through profit or loss should be made separately for each associate or joint venture at initial recognition. The amendment has no impact on the Group’s financial statements.

IFRIC 22 Foreign Currency Transactions and Advance Consideration. The interpretation clarifies how to determine the date of transaction for the exchange rate to be used on initial recognition of a related asset, expense or income where an entity pays or receives consideration in advance for foreign currency-denominated contracts. The amendment has no impact on the Group’s financial statements.

Transfers of Investment Property (Amendments to IAS 40). The amendments clarify that transfers to, or from, investment property can only be made if there has been a change in use that is supported by evidence. A change in use occurs when the property meets, or ceases to meet, the definition of investment property. A change in intention alone is not sufficient to support a transfer. The amendment has no impact on the Group’s financial statements.

Standards, Amendments to published Standards and Interpretations issued but not yet effective

Certain standards, amendments to published standards and interpretations have been issued that are mandatory for accounting periods beginning on or after January 1, 2019 or later periods, but which the Group has not early adopted.

At the reporting date of these financial statements, the following were in issue but not yet effective:

Sale or Contribution of Assets between an Investor and its Associate or Joint Venture (Amendments to IFRS 10 and IAS 28)IFRS 16 LeasesIFRS 17 Insurance ContractsIFRIC 23 Uncertainty over Income Tax TreatmentsPrepayment Features with negative compensation (Amendments to IFRS 9)Long-term Interests in Associates and Joint Ventures (Amendments to IAS 28)Annual Improvements to IFRSs 2015-2017 CyclePlan Amendment, Curtailment or Settlement (Amendments to IAS 19)Definition of a Business (Amendments to IFRS 3)Definition of Material (Amendments to IAS 1 and IAS 8)

Where relevant, the Group is still evaluating the effect of these Standards, amendments to published Standards issued but not yet effective, on the presentation of its financial statements.

The preparation of financial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Company’s accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed in note 4.

Notes to the Financial Statements (cont’d)

Year ended December 31, 2018



2.2 Revenue recognition

(a) Revenue from contracts with customers

(i) Performance obligations and timing of revenue recognitionThe majority of the revenue is derived from selling goods with revenue recognised at a point in time when control of the goods has transferred to the customer. This is generally when the goods are delivered to the customer. However, for export sales, control might also be transferred when delivered either to the port of departure or port of arrival, depending on the specific terms of the contract with a customer. There is limited judgement needed in identifying the point control passes: once physical delivery of the products to the agreed location has occurred, the Group no longer has physical possession, usually will have a present right to payment and retains none of the significant risks and rewards of the goods in question.

(ii) Sale of goodsRevenue represents the gross proceeds of sugar, molasses and bagasse, the sale of electricity and ethanol, hospitality services and sale of land.

Sugar, molasses and bagasse proceeds are recognised on total production of the crop year. Sugar, molasses and bagasse prices are based on prices recommended by the Mauritius Cane Industry Authority for the crop year after consultation with the Mauritius Sugar Syndicate. The difference between the recommended price and the final price is reflected in the financial year in which it is established.

Sale of electricity and ethanol are recognised when the goods are delivered and titles have passed, at which time all of the following conditions are satisfied:

- the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;

- the Group retains neither continuing managerial involvement to the degree usually associated with the ownership nor effective control over the goods sold;

- the amount of revenue can be measured reliably;

- it is probable that the economic benefits associated with the transaction will flow to the Group and

- the costs incurred or to be incurred in respect of the transaction can be measured reliably.

(iii) Rendering of servicesRevenue from rendering of services are recognised in the accounting year in which the services are rendered (by reference to completion of the specific transaction assessed on the basis of the actual service provided as a proportion of total services to be provided).

The Group has applied the following transitional reliefs in IFRS 15:

• for completed contracts that have variable consideration, the Group has used the transaction price at the date the contract was completed rather than estimating variable consideration in earlier periods. Completed contracts are those for which the Group had completed all its performance obligations prior to the date of transition.

• it has not restated completed contracts that: - begin and end within the same annual

reporting period; or - were completed contracts at the beginning

of the earliest period presented

• for contracts that were modified before the beginning of the earliest period presented, the Group has reflected the aggregate effect of all of the modifications that occurred before the start of the comparative period by:

- identifying the satisfied and unsatisfied performance obligations;

- determining the transaction price; and - allocating the transaction price to

the satisfied and unsatisfied performance conditions.



2.2 Revenue recognition (cont’d)

(a) Revenue from contracts with customers (cont’d)

Determining the transaction priceMost of the revenue is derived from fixed price contracts and therefore the amount of revenue to be earned from each contract is determined by reference to those fixed prices.

Practical Exemptions The Group has taken advantage of the practical exemptions:• not to account for significant financing

components where the time difference between receiving consideration and transferring control of goods (or services) to its customer is one year or less; and

• expense the incremental costs of obtaining a contract when the amortisation period of the asset otherwise recognised would have been one year or less.

(b) Other revenues earned by the Group are recognised on the following bases:

• Royalty income - on an accruals basis in accordance with the substance of the relevant agreements.

• Interest income is calculated by applying the effective interest rate to the gross carrying amount of a financial asset except for financial assets that subsequently become credit-impaired. For credit-impaired financial assets the effective interest rate is applied to the net carrying amount of the financial asset (after deduction of the loss allowance).

• Dividend income - when the shareholder’s right to receive payment is established.

• Lease income arising from operating leases-on a straight-line basis over the lease term.

Sale of completed propertyA property is regarded as sold when the significant risks and rewards have been transferred to the buyer, which is normally on unconditional exchange of contracts. For conditional exchanges, sales are recognised only when all the significant conditions are satisified.

Sale of property under developmentWhere the property is under development and agreement has been reached to sell such property when construction is complete, the directors consider whether the contract comprises:• A contract to construct a property or;• A contract for the sale of a completed property.

Where the contract is judged to be for the construction of a property, revenue is recognised using the percentage of completion method as construction progresses.

If, however, the legal terms of the contract are such that the construction represents the continuous transfer of work in progress to the purchaser, the percentage of completion method of revenue recognition is applied and revenue is recognised as work progresses. Continuous transfer of work in progress is applied when:

• The buyer controls the work in progress, typically when the land on which development is taking place is owned by the final customer; and

• All significant risks and rewards of ownership of the work in progress in its present state are transferred to the buyer as construction progresses, typically when the buyer cannot put the incomplete property back to the Group.

In such situations, the percentage of work completed is measured based on the costs incurred up until the end of the reporting period as a proportion of total costs expected to be incurred.


2.3 Exceptional itemsExceptional items are disclosed separately in the financial statements where it is necessary to do so to provide further understanding of the financial performance of the Group. They are material items of income or expense that have been shown separately due to the significance of their nature or amount.

2.4 Hedge accounting

Hedge accounting is applied to financial assets and financial liabilities only where all of the following criteria are met:

- At the inception of the hedge there is formal designation and documentation of the hedging relationship and the Group’s/Company’s a risk management objective and strategy for undertaking the hedge;

- The hedge relationship meets all of the hedge effectiveness requirements including that an economic relationship exists between the hedged item and the hedging instrument, the credit risk effect does not dominate the value changes, and the hedge ratio is designated based on actual quantities of the hedged item and hedging instrument.

(i) Cash flow hedgesThe effective portion of changes in the fair value of derivatives that are designated and qualify as cash flow hedges is recognised in other comprehensive income. The gain or loss relating to the ineffective portion is recognised immediately in profit or loss within finance cost.

Amounts accumulated in equity are reclassified to profit or loss in the periods when the hedged item affects profit or loss.

When a hedging instrument expires or is sold, or when a hedge no longer meets the criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains in equity and is recognised when the forecast transaction is ultimately recognised in profit or loss. When a forecast transaction is no longer expected to occur, the cumulative gain or loss that was reported in equity is immediately transferred to profit or loss within finance cost.

The Group has foreign bank loans (hedge item) denominated in Euro and USD and has its revenue streams (hedge instrument) in Euro and USD. The Group has a cash flow hedge whereby the foreign exchange exposure arising from translation of the bank loan is hedged against the revenue streams.

Exchange differences arising from the translation of the loan is taken to ‘Hedging reserve’. The realised gain/(loss) on repayment of the bank loan is then released to the statement of profit or loss and other comprehensive income.

2.5 Property, plant and equipment

Freehold land is stated at fair value, based on valuations by external independent valuers. Buildings held for use in the production or supply of goods or for administrative purposes, are stated at historical cost, less subsequent depreciation for buildings. All other property, plant and equipment are stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the assets’ carrying amount or recognised as a separate asset as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably.

Increases in the carrying amount arising on revaluation are credited to other comprehensive income and shown as revaluation surplus in shareholders’ equity. Decreases that offset previous increases of the same asset are charged against revaluation surplus directly in equity; all other decreases are charged to profit or loss.

Properties in the course of construction for production, or administrative purposes or for purposes not yet determined are carried at cost less any recognised impairment loss. Cost includes professional fees and for qualifying assets, borrowing costs capitalised. Depreciation of these assets, on the same basis as other property assets, commences when the assets are ready for their intended use.






2.5 Property, plant and equipment (cont’d)

Bearer plants have been estimated based on the cost of land preparation and planting of bearer canes.

Depreciation is calculated on the straight-line method to write off the cost or revalued amounts of the assets, to their residual values over their estimated useful lives as follows:

BuildingsLeasehold propertiesPower, plant and equipmentRefinery plantFactory, plant and equipmentDistillery plantBearer Plants

2 - 2.25 %1% 5 - 7 %5 % 2 - 20 %4 %14 %

Freehold land is not depreciated.

The assets’ residual values, useful lives and depreciation methods are reviewed, and adjusted prospectively, if appropriate, at the end of each reporting period.

Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.

Gains and losses on disposals of property, plant and equipment are determined by comparing proceeds with carrying amount and are included in profit or loss. On disposal of revalued assets, the amounts included in revaluation surplus relating to that asset are transferred to retained earnings.

2.6 Intangible assets

(a) Computer softwareAcquired computer software licences are capitalised on the basis of costs incurred to acquire and bring to use the specific software and are amortised using the straight line method over their estimated useful lives (3 years).

Costs associated with developing or maintaining computer software are recognised as an expense as incurred. Costs that are directly associated with the production of identifiable and unique software controlled by the Group and that will generate economic benefits exceeding costs beyond one year, are recognised as intangible assets. Direct costs include the software development employee costs and an appropriate portion of relevant overheads.

(b) Goodwill Goodwill arising on an acquisition of a business is carried at cost as established at the date of acquisition of the business less accumulated impairment losses, if any.

Goodwill is tested annually for impairment.

On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gains and losses on disposal.

Goodwill is allocated to cash-generating units for the purpose of impairment testing.

(c) Land conversion rights (i) Blue Print and Early Retirement Scheme CostThe cash compensation together with the costs of land and infrastructure payable under the Blue Print and Early Retirement Scheme is capitalised as land conversion rights. Such costs are charged to profit or loss when the associated benefits related to the special rights to acquire, convert and sell agricultural land are realised. At the end of each financial year, the carrying amount is subject to testing for impairment and reduced to the recoverable amount, if this is less.


2.6 Intangible assets (cont’d)

(c) Land conversion rights (cont’d)

(ii) Sugar Industry Voluntary Retirement Scheme (VRS)

VRS costs (net of refunds under the Multi-Annual-Adaptation Scheme and pension obligations previously provided for) are carried forward on the basis that under the Scheme, the Company acquires the right to sell land on which no conversion taxes are payable. The remaining costs from which no land conversion rights was applied has been revalued at the end of the financial year and treated as intangible assets. At the end of each financial year, the land conversion rights will be tested for impairment.

(d) Energy management contract - The GroupOmnicane Milling Operations Limited acquired the rights to the management contract of Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) Limited, two energy generating entities. This management contract will run for a period of twenty years in line with the provisions of the Purchasing Power Agreement between Omnicane Thermal Energy Operations (La Baraque) Limited and Omnicane Thermal Energy Operations (St Aubin) and the Central Electricity Board. These rights have been recognised as an intangible assets and are amortised over the life of the contract.

Part of the energy management contracts was sold to Omnicane Management and Consultancy Limited in 2017.

(e) Rebranding costIn 2009, the Group completed a rebranding exercise aiming at regrouping all members under a common brand. All costs associated to the rebranding exercise have been capitalised and included as an intangible asset. Rebranding cost is amortised over a period of 20 years, time at which a full review of the brand will be performed.

(f) Bond expensesTransaction costs relating to bond issues have been capitalised and included under intangible assets and are amortised over the life of the bonds, which are 1, 3 and 5 years.

(g) Legal and professional costs in respect of Power Purchase Agreement (PPA)The two energy generating entities, Omnicane Thermal Energy Operations (St Aubin) Limited and Omnicane Thermal Energy Operations (La Baraque) Limited incurred costs in relation to the Power Purchase Agreements (PPA) they both have with the Central Electricity Board. These legal and professional fees have been treated as intangible assets and are amortised over the term of each contract, which are for a 20 year period.

2.7 Investments in subsidiaries

Separate financial statements of the investorIn the separate financial statements of the investor, investment in subsidiary companies are carried at cost. The carrying amount is reduced to recognise any impairment in the value of individual investments.

Consolidated financial statementsSubsidiaries are all entities (including structured entities) over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and the ability to affect those returns through its power over the entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

The acquisition method of accounting is used to account for business combinations by the Group. The consideration transferred for the acquisition of a subsidiary is the fair value of the assets transferred, the liabilities incurred and the equity interests issued by the Group. The consideration transferred includes the fair value of any assets or liabilities resulting from a contingent consideration arrangement. Acquisition-related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair value at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interests in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets.






2.7 Investments in subsidiaries (cont’d)

Consolidated financial statements (cont’d)

The excess of the consideration transferred, the amount of any non-controlling interests in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree (if any) over the fair value of the identifiable net assets acquired is recorded as goodwill. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in the profit or loss as a bargain purchase gain.

Inter-company transactions, balances and unrealised gains on transactions between Group companies are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group.

Transactions with non-controlling interestsThe Group treats transactions with non-controlling interests as transactions with equity owners of the Group. For purchases from non-controlling interests, the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of the subsidiary is recorded in equity. Gains or losses on disposal to non-controlling interests are also recorded in equity.

Disposal of subsidiariesWhen the Group ceases to have control or significant influence, any retained interest in the entity is remeasured to its fair value, with the change in carrying amount recognised in profit or loss. The fair value is the initial carrying amount for the purpose of subsequently accounting for the retained interest as an associate, joint venture or financial asset. In addition, any amounts previously recognised in other comprehensive income in respect of that entity are accounted for as if the Group had directly disposed of the related assets or liabilities. This may mean that amounts previously recognised in other comprehensive income are reclassified to profit or loss.

2.8 Investments in associated companies

Separate financial statements of the investorIn the separate financial statements of the investor, investments in associated companies are carried at cost. The carrying amount is reduced to recognise any impairment in the value of individual investments.

Consolidated financial statementsAn associate is an entity over which the Group has significant influence but not control, or joint control, in the financial and operating policies and decisions of the investee. Generally an accompanying shareholding between 20% and 50% of the voting rights is held by the Group in such Companies.

Investments in associates are accounted for using the equity method except when classified as held for sale. Investment in associates is initially recognised at cost as adjusted by post acquisition changes in the Group’s share of the net assets of the associate less any impairment in the value of individual investments.

Any excess of the cost of acquisition and the Group’s share of the net fair value of the associate’s identifiable assets and liabilities recognised at the date of acquisition is recognised as goodwill, which is included in the carrying amount of the investment. Any excess of the Group’s share of the net fair value of identifiable assets and liabilities over the cost of acquisition, after assessment, is included as income in the determination of the Group’s share of the associate’s profit or loss.

When the Group’s share of losses exceeds its interest in an associate, the Group discontinues recognising further losses, unless it has incurred legal or constructive obligation or made payments on behalf of the associate.

Unrealised profits and losses are eliminated to the extent of the Group’s interest in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.


2.8 Investments in associated companies (cont’d)

Consolidated financial statements (cont’d)

Where necessary, appropriate adjustments are made to the financial statements of associates to bring the accounting policies used in line with those adopted by the Group.

If the ownership interest in an associate is reduced but significant influence is retained, only a proportionate share of the amounts previously recognised in other comprehensive income are reclassified to profit or loss where appropriate.

Dilution gains and losses arising on investments in associates are recognised in profit or loss.

2.9 Financial assets

The Group/Company classifies its financial assets into one of the categories discussed below, depending on the purpose for which the asset was acquired. Other than financial assets in a qualifying hedging relationship, the Group’s accounting policy for each category is as follows:

(i) Amortised costThese assets arise principally from the provision of goods and services to customers (e.g. trade receivables), but also incorporate other types of financial assets where the objective is to hold these assets in order to collect contractual cash flows and the contractual cash flows are solely payments of principal and interest. They are initially recognised at fair value plus transaction costs that are directly attributable to their acquisition or issue, and are subsequently carried at amortised cost using the effective interest rate method, less provision for impairment.

Impairment provisions for trade receivables are recognised based on the simplified approach within IFRS 9 using the lifetime expected credit losses. During this process the probability of the non-payment of the trade receivables is assessed. This probability is then multiplied by the amount of the expected loss arising from default to determine the lifetime expected credit loss for the trade receivables. For trade receivables, which are reported net, such provisions are recorded in a separate provision account with the loss being

recognised within cost of sales in the statement of comprehensive income. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

Impairment provisions for receivables from related parties and loans to related parties are recognised based on a forward looking expected credit loss model. The methodology used to determine the amount of the provision is based on whether there has been a significant increase in credit risk since initial recognition of the financial asset. For those where the credit risk has not increased significantly since initial recognition of the financial asset, twelve month expected credit losses along with gross interest income are recognised. For those for which credit risk has increased significantly, lifetime expected credit losses along with the gross interest income are recognised. For those that are determined to be credit impaired, lifetime expected credit losses along with interest income on a net basis are recognised.

From time to time, the Group elects to renegotiate the terms of trade receivables due from customers with which it has previously had a good trading history. Such renegotiations will lead to changes in the timing of payments rather than changes to the amounts owed and, in consequence, the new expected cash flows are discounted at the original effective interest rate and any resulting difference to the carrying value is recognised in the statement of comprehensive income (operating profit).

The Group’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents in the statement of financial position.

Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less, and - for the purpose of the statement of cash flows - bank overdrafts. Bank overdrafts are shown within loans and borrowings in current liabilities on the statement of financial position.






2.9 Financial assets (cont’d)

(ii) Fair value through other comprehensive incomeThe Group has investments in listed and unlisted entities which are not accounted for as subsidiaries, associates or jointly controlled entities. For those investments, the Company/Group has made an irrevocable election to classify the investments at fair value through other comprehensive income rather than through profit or loss as the Company/Group considers this measurement to be the most representative of the business model for these assets. They are carried at fair value with changes in fair value recognised in other comprehensive income and accumulated in the fair value through other comprehensive income reserve. Upon disposal any balance within fair value through other comprehensive income reserve is reclassified directly to retained earnings and is not reclassified to profit or loss.

The Group has debt securities whose objective is achieved by both holding these securities in order to collect contractual cash flows and having the intention to sell the debt securities before maturity. The contractual terms of the debt securities give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding. They are carried at fair value with changes in fair value recognised in other comprehensive income and accumulated in the fair value through other comprehensive income reserve. Upon disposal any balance within fair value through other comprehensive income reserve is reclassified to profit or loss.

Dividends are recognised in profit or loss, unless the dividend clearly represents a recovery of part of the cost of the investment, in which case the full or partial amount of the dividend is recorded against the associated investments carrying amount.

Purchases and sales of financial assets measured at fair value through other comprehensive income are recognised on settlement date with any change in fair value between trade date and settlement date being recognised in the fair value through other comprehensive income reserve.

2.10 Financial liabilities

The Group classifies its financial liabilities depending on the purpose for which the liability was acquired.

Other than financial liabilities in a qualifying hedging relationship, the Group’s accounting policy for each category is as follows:

Other financial liabilitiesOther financial liabilities include the following items:Bank borrowings and the Group’s bonds, private placements and other loans are initially recognised at fair value net of any transaction costs directly attributable to the issue of the instrument. Such interest bearing liabilities are subsequently measured at amortised cost using the effective interest rate method, which ensures that any interest expense over the period to repayment is at a constant rate on the balance of the liability carried in the statement of financial position. For the purposes of each financial liability, interest expense includes initial transaction costs and any premium payable on redemption, as well as any interest payable while the liability is outstanding.

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least twelve months after the end of the reporting period.

Trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest method.


2.11 Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation but are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. Any impairment loss is recognised for the amount by which the carrying amount of the asset exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

2.12 Biological assets

Bearer biological assets (other than bearer plants) and consumable biological assets are stated at their fair value.

Consumable biological assetsStanding canes are measured at their fair value. The fair value of the standing canes is the present value of the expected net cash flow from the standing canes discounted at the relevant market determined pre-tax rate.

2.13 Current and deferred income tax

Value added taxRevenues, expenses and assets are recognised net of the amount of value added tax except: • where the value added tax incurred on

a purchase of assets or services is not recoverable from the taxation authority, in which case the value added tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

• receivables and payables that are stated with the amount of value added tax included.

The tax expense for the year comprises of current and deferred tax. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current taxThe current income tax charge is based on taxable income for the year calculated on the basis of tax laws enacted or substantively enacted by the end of the reporting period.

Deferred taxDeferred income tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. However, if the deferred income tax arises from initial recognition of an asset or liability in a transaction, other than a business combination, that at the time of the transaction affects neither accounting nor taxable profit or loss, it is not accounted for.

Deferred income tax is determined using tax rates that have been enacted or substantively enacted at the reporting date and are expected to apply in the period when the related deferred income tax asset is realised or the deferred income tax liability is settled.

Deferred tax assets are recognised to the extent that it is probable that the future taxable profit will be available against which deductible temporary differences can be utilised.

Corporate Social ResponsibilityThe Corporate Social Responsibility (“CSR’’) was legislated by Government in July 2009. In terms of the legislation, the Company is required to allocate 2% of its chargeable income of the preceeding financial year to Government approved CSR projects.

The required CSR charge for the current year is recognised as income tax expense in profit or loss. The net amount of CSR fund payable to the taxation authority is included as income tax payable in the statement of financial position.






2.14 Inventories

Inventories are stated at the lower of cost and net realisable value. Cost of coal and molasses in the energy cluster is determined by first-in first-out (FIFO) method. Cost of other inventories is determined by the weighted average method. The cost of finished goods and work in progress comprise of raw materials, direct labour, other direct costs and related production overheads (based on normal operating capacity) but exclude borrowing costs. Net realisable value is the estimate of the selling price in the ordinary course of business less the costs of completion and applicable variable selling expenses.

2.15 Land under development

Land under development comprises cost of land to be sold and related infrastructural costs. This expenditure is released to profit or loss to the extent that proceeds are received on the sale of land.

2.16 Non-current assets held for sale

Non-current assets classified as held for sale are measured at the lower of carrying amount and fair value less costs to sell if their carrying amount is recovered principally through a sale transaction rather than through a continuing use. This condition is regarded as met only when the sale is highly probable and the asset is available for immediate sale in its present condition.

Events or circumstances may extend the period to complete the sale beyond one year if the delay is caused by events or circumstances beyond the entity’s control and there is sufficient evidence that the entity remains committed to its plan to sell the asset.

When the Group is committed to a sale plan involving loss of control of a subsidiary, all of the assets and liabilities of that subsidiary are classified as held for sale when the criteria described above are met, regardless of whether the Group will retain a non-controlling interest in its former subsidiary after the sale.

2.17 Share capital

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares or options are shown in equity as deduction, net of tax, from proceeds.

2.18 Leases

(a) Leases are classified as finance leases where the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to profit or loss on a straight-line basis over the period of the lease.

(b) Accounting for leases - where the Company is the lesseeFinance leases are capitalised at the lease’s inception at the lower of the fair value of the leased property and the present value of the minimum lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate of interest on the remaining balance of the liability. Finance costs are charged to profit or loss unless they are attributable to qualifying assets in which case, they are capitalised in accordance with the policy on borrowings costs (see note 2.19)

2.19 Borrowings costs

Borrowings costs directly attributable to the acquisition, construction or production of qualifying assets are capitalised until such time as the assets are substantially ready for their intended use or sale.

2.20 Retirement benefit obligations

Defined benefit planA defined benefit plan is a pension plan that is not a defined contribution plan. Typically defined benefit plans define an amount of pension benefit that an employee will receive on retirement, usually dependent on one or more factors such as age, years of service and compensation.


2.20 Retirement benefit obligations (cont’d)

Defined benefit plan (cont’d)

The liability recognised in the statement of financial position in respect of defined benefit pension plans is the present value of the defined benefit obligation at the end of the reporting period less the fair value of plan assets. The defined benefit obligation is calculated annually by independent actuaries using the projected unit credit period.

Remeasurement of the net defined benefit liability, which comprise of actuarial gains and losses arising from experience adjustments and changes in actuarial assumptions, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), is recognised immediately in other comprehensive income in the period in which they occur. Remeasurements recognised in other comprehensive income shall not be reclassified to profit or loss in subsequent period.

The Group determines the net interest expense/(income) on the net defined benefit liability/(asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the net defined benefit liability/(asset), taking into account any changes in the net defined liability/(asset) during the period as a result of contributions and benefit payments. Net interest expense/(income) is recognised in profit or loss.

Service costs comprising of current service costs, past service costs, as well as gains and losses on curtailments and settlements are recognised immediately in profit or loss.

Gratuity on retirementFor employees who are not covered (or who are insufficiently covered by the above pension plans), the net present value of the gratuity on retirement payable under the Employment Rights Act 2008 is calculated by a (qualified) actuary and provided for. The obligations arising under this item are not funded.

2.21 Provisions

Provisions are recognised when the Group has a present legal or constructive obligation as a result of past events; it is probable that an outflow of resources that can be reliably estimated will be required to settle the obligation.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at the end of the reporting period, taking into account the risks and uncertainties surrounding the obligation. When a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows (when the effect of the time value of money is material).

2.22 Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s financial statements in the year in which the dividends are declared.

2.23 Foreign currencies

(i) Functional and presentation currencyItems included in the financial statements of each of the Group’s entities are measured using Mauritian rupees, the currency of the primary economic environment in which the entity operates ‘functional currency’. The consolidated financial statements are presented in Mauritian rupees, which is the Company’s functional and presentation currency.

(ii) Transactions and balancesForeign currency transactions are translated into the functional currency using the exchange rates prevailing on the date of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in profit or loss, except when deferred in equity as qualifying cash flow hedge.

Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the profit or loss within ‘finance income or cost’.





3. FINANCIAL RISK MANAGEMENT

3.1 Financial risk factors

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

The Group’s overall risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance. The Company uses derivative financial instruments to hedge certain risk exposures.

Financial risk management is carried out by the Treasury Department under policies approved by the Board of Directors. The Treasury Department identifies, evaluates and hedges financial risks in close co-operation with the operating units. The Risk Committee of the Board provides written principles for overall risk management, as well as written policies covering specific areas, such as foreign exchange risk, interest rate risk, credit risk, use of derivative financial instruments and investment of excess liquidity.

(a) Market risk(i) Currency riskThe Group’s activities is mainly in the sugarcane growing and milling, electricity and ethanol production and hospitality services. The market strategy for the sale of raw and refined sugar rests with the Mauritius Sugar Syndicate (MSS) which is responsible for negotiating the sale of the sugar production of the country with potential buyers. The Group invoices its refined sugar in Euro to the MSS and ethanol in USD to Alcogroup S.A, who is the main offtaker for the Ethanol distillery. For electricity production, sale is made solely to the Central Electricity Board (CEB) and is based on a Power Purchase Agreement (PPA) for both energy companies. Coal used for electricity production is purchased in US dollar but its effect is mitigated by the fact that the tariff of electricity sold to the Central Electricity Board is adjusted in respect to changes in exchange rates.


2.23 Foreign currencies (cont’d)

(ii) Transactions and balances (cont’d)

Non-monetary items that are measured at historical cost in a foreign currency are translated using the exchange rates at the date of the transaction.

Non-monetary items that are measured at fair value in a foreign currency are translated using the exchange rates at the date the fair value was determined.

(iii) Group companiesThe results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(a) assets and liabilities for each statement of financial position presented are translated at the closing rate at the date of that statement of financial position;

(b) income and expenses for each statement representing profit or loss and other comprehensive income are translated at average exchange rates (unless this average is not a reasonable approximation of the cumulative effect of the rates prevailing on the transaction date, in which case income and expenses are translated at the date of the transactions) and

(c) all resulting exchange differences are recognised in other comprehensive income.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

2.24 Segment reporting

Segment information presented relate to operating segments that engage in business activities for which revenues are earned and expenses incurred.

3. FINANCIAL RISK MANAGEMENT (cont’d)

3.1 Financial risk factors (cont’d)

(a) Market risk (cont’d)

(i) Currency risk (cont’d)

At December 31, 2018, if the Mauritian rupee (MUR) had weakened/strenghthened by 5% against the US Dollar, the GB Pound and the Euro with all other variables held constant, post tax profit and equity would have been Rs’000 9,881 (2017: Rs’000 13,046) higher/lower for the Company, mainly as a result of foreign exchange gains/losses on translation of US Dollar and Euro denominated cash balances and foreign exchange gains/losses on translation of US Dollar and Euro denominated short-term bank facility.

At December 31, 2018, if the MUR had weakened/strenghthened by 5% against the US Dollar, GBP, Euro and ZAR with all other variables held constant, post tax profit would have been Rs’000 66,512 higher/lower (2017: Rs’000 97,905) for the Group following changes in foreign exchange differences on translation of US Dollar, GBP, Euro and ZAR denominated cash balances, trade receivables and bank borrowings.

(ii) Price riskThe Group’s listed and unlisted equity securities are susceptible to market price risk arising from uncertainties about future values of the investment securities. The Group manages the equity price risk through diversification. The Group’s Board of Directors reviews and approves all equity investment decisions.

The table below summarises the impact of increases/decreases in the fair value of the investments on the Group’s equity. The analysis is based on the assumption that the fair value had increased/decreased by 5%.

CATEGORIES OF INVESTMENTS: THE GROUP THE COMPANY

Impact on equity2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Available for sale - 14,948 - 312

Financial asset at fair value 11,069 - 94

Commodity price riskThe Group is affected by the price volatility of certain commodities. Its sugar operations are ultimately exposed to the sugar price on the world market, and particularly the EU market. The EU sugar market conditions have deteriorated over the year and has experienced higher volatility since the abolition of production quotas for EU beet sugar producers on October 1, 2017. The Group mitigates this risk through a strategy of diversification of markets and revenue sources. Further the energy operations require the ongoing purchase of coal for power generation. The Group ensures that the coal price volatility risk is adequately mitigated through indexation mechanisms in its Power Purchase Agreements.

THE GROUP

Impact on profit or loss Impact on equity

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Price of Sugar 17 25 17 25

(iii) Sensitivity analysisThe table below summarises the impact of increases/decreases in the price of sugar on the Group. The analysis is based on the assumption that the fair value and the sugar price had increased/decreased by 5%.







(a) Market risk (cont’d)

Limitation of sensitivity analysisSensitivity analysis in respect of market risk demonstrates the effect of a change in a key assumption while other assumptions remain unchanged. In reality, there is a correlation between the assumptions and other factors. It should also be noted that these sensitivities are non-linear, and larger or smaller impacts should not be interpolated or extrapolated from these results.

Sensitivity analysis does not take into consideration that the Group’s assets and liabilities are managed. Other limitations include the use of hypothetical market movements to demonstrate potential risk that only represent the Group’s view of possible near-term market changes that cannnot be predicted with any certainty.

(b) Credit riskCredit risk arises from cash and cash equivalents, contractual cash flows of debt investments carried at amortised cost, at fair value through other comprehensive income (FVOCI), favourable derivative financial instruments and deposits with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables.

Credit risk is managed on a Group basis. For banks and financial institutions, only independently rated parties are accepted.

Risk control assesses the credit quality of the customer, taking into account its financial position, past experience and other factors. Individual risk limits are set based on internal or external ratings in accordance with limits set by the board. The compliance with credit limits by customers is regularly monitored by line management.

Sales to retail customers are required to be settled in cash or using major credit cards, mitigating credit risk. There are no significant concentrations of credit risk, whether through exposure to individual customers, specific industry sectors and/or regions.

The Group’s investments in debt instruments are considered to be low risk investments. The credit ratings of the investments are monitored for credit deterioration.

The amounts presented in the statement of financial position are net of allowance for doubtful receivables, estimated by the Group’s management based on prior experience and the current environment.

The Group’s main debtors are the Mauritius Sugar Syndicate on account of sugar proceeds receivable, the Central Electricity Board for the sale of electricity and Alcogroup for the sale of ethanol.

The Group’s energy cluster’s credit risk is highly mitigated by the fact that accounts receivable from its sole customer, the Central Electricity Board, is guaranteed by the Government.

(c) Liquidity riskLiquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivery of cash or another financial asset.

Prudent liquidity risk management includes maintaining sufficient cash and marketable securities, the availability of funding from an adequate amount of committed credit facilities and the ability to close out market positions. The Group aims at maintaining flexibility in funding by keeping committed credit lines available.

Management monitors rolling forecasts of the Group’s liquidity reserve on the basis of expected cash flow and does not foresee any major liquidity risk over the next two years.

THE GROUP THE COMPANYForecast

2019Rs’000

Actual2018

Rs’000

Forecast2019

Rs’000

Actual2018

Rs’000Opening balance for the period (1,203,724) (1,042,816) (1,123,173) (1,142,110)Cash from/(used in) operating activities 57,972 63,482 (589,093) (838,884)Cash from/(used in) investing activities 640,960 (207,278) 1,442,275 688,957 Cash (used in)/from financing activities (479,371) 5,331 (1,028,124) 169,012 Effect of foreign exchange rate changes 4,902 (22,443) - (148)Closing balance for the period (979,261) (1,203,724) (1,298,115) (1,123,173)

THE GROUPLess than

1 yearRs’000

Between 1 and 2 years

Rs’000


Rs’000

Over 5 yearsRs’000

At December 31, 2018Trade and other payables 1,518,792 - - -Bank borrowings 2,851,815 1,297,735 1,326,440 1,071,582Private placement - - 300,000 2,200,000Bonds 210,000 - 1,590,000 -Finance lease liabilities 24,809 19,773 24,366 -Loan from related party 89,274 -Payable to related parties 132,397 - - -

THE GROUPLess than

1 yearRs’000


Rs’000


Rs’000


At December 31, 2017Trade and other payables 1,029,005 - - -Bank borrowings 2,760,474 1,023,831 2,068,500 557,629Private placement - - 300,000 2,200,000Bonds - 210,000 1,150,000 440,000Finance lease liabilities 26,062 19,542 21,936 -Loan from related party - 14,000 - -Payable to related parties 133,206 - - -



(c) Liquidity risk (cont’d)

Forecasted liquidity reserve as at December 31, 2019 is:

The table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the reporting date to the contractual maturity date:





THE COMPANYLess than

1 yearRs’000


Rs’000


Rs’000


At December 31, 2018Trade and other payables 516,601 - - -Bank borrowings 1,555,424 449,696 175,000 -Private placement - - 300,000 2,200,000Bonds 210,000 - 1,590,000 -Finance lease liabilities 7,002 5,353 5,731 -Payable to related parties 544,031 - - -

At December 31, 2017Trade and other payables 190,251 - - -Bank borrowings 1,845,240 101,666 - -Private placement - - 300,000 2,200,000Bonds - 210,000 1,150,000 440,000Finance lease liabilities 7,366 5,949 5,631 -Payable to related parties 57,928 - - -



(c) Liquidity risk (cont’d)

3.2 Capital risk management

The Group’s objective when managing capital is to safeguard the Group’s ability to continue as a going concern so that it can continue to provide returns for shareholders and benefits for other stakeholders.

The Group sets the amount of capital in proportion to risk. The Group manages the capital structure and makes adjustments to it in the light of changes in economic conditions and the risk characteristics of the underlying assets. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

Consistently with others in the industry, the Group monitors capital on the basis of the debt-to-adjusted capital ratio. This ratio is calculated as net debt over adjusted capital. Net debt is calculated as total debt (as shown in the statement of financial position) less cash in hand and at bank. Adjusted capital comprises of all components of equity (i.e. share capital, share premium, retained earnings, revaluation surplus and other reserves) other than amounts recognised in equity relating to cash flow hedges.

THE GROUP THE COMPANY2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Total debt (note 31) 11,005,794 10,791,974 6,498,206 6,265,852Less: cash and cash equivalents (note 37(e)) (218,126) (387,644) (12,326) (54,788)Net debt 10,787,668 10,404,330 6,485,880 6,211,064


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Owners’ interest 9,930,284 10,964,991 9,699,193 10,371,930Amount recognised in equity relating to cash flow hedges 13,869 36,426 - -

Adjusted capital 9,944,153 11,001,417 9,699,193 10,371,930

Debt-to-adjusted capital ratio 1.08 0.95 0.67 0.60

There were no changes in the Group’s approach to capital risk management during the year.


3.2 Capital risk management (cont’d)

The debt-to-adjusted capital ratios at December 31, 2018 and December 31, 2017 were as follows:

3.3 Fair value estimation

The fair value of financial instruments traded in active markets is based on quoted market prices at the end of the reporting period. A market is regarded as active if quoted prices are readily and regularly available from an exchange, dealer, broker, industry group, pricing service, or regulatory agency, and those prices represent actual and regularly occurring market transactions on an arm’s length basis. The quoted market price used for financial assets held by the Group is the current bid price. These instruments are included in level 1. Instruments included in level 1 comprise mainly of quoted equity investments classified as trading securities or available-for-sale.

The fair value of financial instruments that are not traded in an active market is determined by using valuation techniques. These valuation techniques maximise the use of observable market data where it is available and rely as little as possible on specific estimates. If all significant inputs required to fair value an instrument are observable, the instrument is included in level 2.

If one or more of the significant inputs is not based on observable market data, the instrument is included in level 3.

Specific valuation techniques used to value financial instruments include:- Quoted market prices or dealer quotes for

similar instruments.- Other techniques, such as discounted cash

flow analysis, are used to determine fair value for the remaining financial instruments.

The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair value. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cashflows at the current market interest rate that is available to the Group for similar financial instruments.






3.4 Biological assets

The Group is exposed to fluctuations in the price of sugar and the incidence of exchange rate. The risk affects both the crop proceeds and the fair value of biological assets. The risk is not hedged.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS

Estimates and judgements are continuously evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances.

4.1 Critical accounting estimates and assumptions

The Group makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(i) Biological assets(a) Bearer biological assets Bearer biological assets have been estimated

based on the cost of land preparation and planting of bearer canes.

(b) Consumable biological assets - Standing Canes The fair value of consumable biological assets

has been arrived at by discounting the present value of expected net cash flows from standing canes at the relevant market determined pre-tax rate.

The expected cash flows have been computed by estimating the expected crop and the sugar extraction rate and the forecasts of sugar prices which will prevail in the coming year for standing canes. The harvesting costs and other direct expenses are based on the yearly budgets of the Group.

(ii) Fair value of securities not quoted in an active marketThe fair value of securities not quoted in an active market may be determined by the Group using valuation techniques including third party transaction values, earnings, net asset value or discounted cash flows, whichever is considered to be appropriate. The Group would exercise judgement and estimates on the quantity and quality of pricing sources used. Changes in assumptions about these factors could affect the reported fair value of financial instruments.

(iii) Impairment of available-for-sale financial assetsFor the year ended December 31, 2017, the Group follows the guidance of IAS 39 on determining whether an investment is other-than-temporarily impaired. This determination requires significant judgement. In making this judgement, they evaluate, among other factors, the duration and extent to which the fair value of an investment is less than its cost, and the financial health of and near-term business outlook for the investee, including factors such as industry and sector performance, changes in technology and operational and financing cash flow.

(iv) Recoverability of proceeds from sale of landAt December 31, 2018, management considered the recoverability of proceeds from sale of land under Section 8 of the Land Acquisition Act. Proceeds have been determined on a case to case basis and taking into account the location of the land, surveyors’ report and previous sale of similar properties in the vicinity.

(v) Depreciation policiesProperty, plant and equipment are depreciated to their residual values over their estimated useful lives. The residual value of an asset is the estimated net amount that the Group would currently obtain from the disposal of the asset if the asset was already of the age and in the condition expected at the end of its useful life.

The directors therefore make estimates based on historical experience and use their best judgement to assess the useful lives of assets and to forecast the expected residual values of the assets at the end of their expected useful lives.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

4.1 Critical accounting estimates and assumptions (cont’d)

(vi) Pension benefitsThe present value of the pension obligations depends on a number of factors that are determined on an actuarial basis using a number of assumptions. The assumptions used in determining the net cost (income) for pensions include the discount rate. Any changes in these assumptions will impact the carrying amount of pension obligations.

The Group determines the appropriate discount rate at the end of each year. This is the interest rate that should be used to determine the present value of estimated future cash outflows expected to be required to settle the pension obligations. In determining the appropriate discount rate, the Group considers the interest rates of high-quality corporate bonds that are denominated in the currency in which the benefits will be paid, and that have terms to maturity approximating the terms of the related pension obligation.

Other key assumptions for pension obligations are based in part on currrent market conditions. Additional information is disclosed in note 32.

(vii) Revaluation of property, plant and equipmentThe Group carries its land at revalued amounts with changes in fair value being recognised in other comprehensive income. The Group engaged independent valuation specialists to determine fair value as at December 31, 2017.

(viii) Limitation of sensitivity analysisSensitivity analysis in respect of market risk demonstrates the effect of a change in a key assumption while other assumptions remain unchanged. In reality, there is a correlation between the assumptions and other factors. It should also be noted that these sensitivities are non-linear and larger or smaller impacts should not be interpolated or extrapolated from these results.

Sensitivity analysis does not take into consideration that the Group’s assets and liabilities are managed. Other limitations include the use of hypothetical market movements to demonstrate potential risk that only represent the Group’s view of possible near-term market changes that cannot be predicted with any certainty.

(ix) Asset lives and residual valuesProperty, plant and equipment are depreciated over its useful life taking into account residual values, where appropriate. The actual lives of the assets and residual values are assessed annually and may vary depending on a number of factors. In reassessing asset lives, factors such as technological innovation, product life cycles and maintenance programmes are taken into account. Residual value assessments consider issues such as future market conditions, the remaining life of the asset and projected disposal values. Consideration is also given to the extent of current profits and losses on the disposal of similar assets.





5. REVENUEThe following is an analysis of the Group’s revenue for the year.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Revenue from contract with customers (note 5(a))Sugar, molasses and bagasse 771,998 1,163,281 144,436 165,362Compensation from Sugar Insurance Fund Board 18,943 45,292 14,721 21,767Electricity generation 2,595,728 2,702,318 - -Ethanol 558,317 367,980 - -Hotel revenue 163,196 150,872 - -Property 43,329 43,329 - -Agricultural diversification and others 93,660 66,078 58,191 32,246

4,245,171 4,539,150 217,348 219,375

(a) Disaggregation of revenue from contracts with customers is as follows:

The loss allowance as at December 31, 2018 and January 1, 2018 (on adoption of IFRS 9) was determined as follows for contract assets


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Contract counterpartiesRetailers 27,789 12,142 27,789 12,142Wholesalers 3,944,986 4,278,871 159,157 187,129Direct to consumers 272,396 248,137 30,402 20,104

4,245,171 4,539,150 217,348 219,375Timing of revenue recognitionAt a point in time 4,245,171 4,539,150 217,348 219,375

THE GROUPCurrent

More than 30 days past due


More than 120 days past due Total

At January 1 and December 31, 2018Expected loss rate (%) 0.5 1 5 100 91Gross carrying amount of contract assets (Rs’000) 4,102 270 89 45,044 49,505Loss allowance (Rs’000) 21 3 4 45,044 45,072

THE COMPANYCurrent




At December 31, 2018Expected loss rate (%) 0.5 1 5 100 85Gross carrying amount of contract assets (Rs’000) 4,043 214 89 24,087 28,433Loss allowance (Rs’000) 20 2 4 24,087 24,113


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Depreciation on property, plant and equipment (note 15) 611,972 599,358 48,629 47,680Amortisation of intangible assets (note 16) 32,022 32,613 10,152 11,525Raw materials and consumables used (note 24(i)) 1,759,133 1,781,066 43,754 49,442Employees remuneration (note 8(a)) 701,571 734,075 195,742 209,854Sugar Insurance Fund Board premium 30,716 23,856 12,170 7,964Growing expenses 39,351 62,189 63,505 77,833Milling and refinery expenses 255,040 301,562 - -Lorries and haulage expenses 100,149 126,650 - -Energy expenses 264,500 290,680 - -Ethanol expenses 58,781 21,063 - -Hospitality expenses 37,153 38,027 - -Administrative expenses 373,086 318,952 82,031 69,532

4,263,474 4,330,091 455,983 473,830

CurrentMore than 30 days past due



At January 1, 2018Expected loss rate (%) 0.5 1 5 100 90Gross carrying amount of contract asset (Rs’000) 724 156 1,875 23,973 26,728Loss allowance (Rs’000) 4 2 94 23,973 24,073

The closing loss allowances for trade receivables as at December 31, 2018 reconcile to the opening loss allowances as follows:


Rs’0002018

Rs’000At December 31 (IAS 39) - -Amounts restated through opening retained earnings 45,072 24,073Loss allowance as at January 1, 2018 (IFRS 9) 45,072 24,073Loss allowance recognised in profit or loss during the year - 40At December 31, 2018 45,072 24,113

5. REVENUE (cont’d)

(a) Disaggregation of revenue from contracts with customers is as follows: (cont’d)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Insurance compensation 13,274 544 - -Sundry income 27,062 18,030 - -Management fees 1,000 1,000 1,000 2,150Profit on sale of property, plant and equipment 3,075 2,154 2,013 1,163

44,411 21,728 3,013 3,313

6. OTHER OPERATING INCOME

7. OPERATING EXPENSES






Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Operating profit/(loss) is arrived at after:charging:Depreciation on property, plant and equipment (note 15) 611,972 599,358 48,629 47,680Amortisation of intangible assets (note 16) 32,022 32,613 10,152 11,525Raw materials and consumables used (note 24(i)) 1,759,133 1,781,066 43,754 49,442Impairment loss on financial asset at amortised cost (note 21(b(i)) - - 64 -Employee benefit expense (note 8(a)) 701,571 734,075 195,742 209,854and crediting:Profit on sale of property, plant and equipment (note 6) (3,075) (2,154) (2,013) (1,163)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Wages and salaries 673,763 670,008 162,918 181,802Pension costs and social costs 27,808 64,067 32,824 28,052

701,571 734,075 195,742 209,854


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Interest income 151,362 116,816 383,865 335,291Dividend income 4,787 4,760 134,450 176,826

156,149 121,576 518,315 512,117


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Foreign exchange (gains)/losses (3,287) (86,383) 12,894 13,466Interest expense on:- Bank overdrafts 73,196 81,273 66,679 76,541- Bank and other loans 253,589 341,240 33,214 69,556- Amount payable to related parties 38,189 7,995 8,510 5,009- Private placement 158,066 46,899 158,066 46,899- Finance lease liabilities 4,955 5,555 1,594 1,732- Bonds 107,560 160,392 107,560 160,392

635,555 643,354 375,623 360,129632,268 556,971 388,517 373,595


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Profit on disposal of land 128,360 62,775 128,360 62,775Land debtors written off - (14,367) - (14,367)Reversal of profit on sale on land - (71,218) - (71,218)

128,360 (22,810) 128,360 (22,810)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Profit on disposal of management contract - 56,717 - 36,200Land conversion rights - 201,665 - 89,281Impairment of investment in subsidiary (note 17) - - (39,054) -Project expenses written off - (45,785) - (45,785)

- 212,597 (39,054) 79,696


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Current tax on adjusted profit for the year at 3%/15% (2017: 3%/15%) 25,741 24,568 - -

CSR charge at 2% 444 - - -Underprovision/(overprovision) in previous years 3,111 291 - -Deferred tax (note 23(c)) 47,266 69,334 6,428 (4,709)Tax charge/(credit) for the year 76,562 94,193 6,428 (4,709)

8. OPERATING PROFIT/(LOSS) 11. OTHER NON-OPERATING INCOME/(EXPENSE)

12. EXCEPTIONAL ITEMS

13. TAXATION(a) Charge/(credit) for the year

9. INVESTMENT INCOME

10. FINANCE COSTS

(a) Employee benefit expense


The tax on the Group’s/Company’s loss before taxation differs from the theoretical amount that would arise using the basic tax rate of the Group/Company as follows:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Loss before taxation: (325,768) (232,373) (18,274) (104,530)Tax calculated at 3%/15 % (2017: 3%/15%) (29,319) (16,718) (5,553) (15,680)CSR charge at 2% 444 - - -Income not subject to tax (58,755) (49,366) (56,607) (59,825)Expenses not deductible for tax purposes 87,968 88,842 28,224 31,196Underprovision in previous year 3,111 291 - -Tax losses utilised - (728) - -Tax losses for which no deferred tax recognised 73,113 71,872 40,364 40,364Tax charge/(credit) for the year 76,562 94,193 6,428 (3,945)





Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, (14,909) (10,488) (388) (2,852)Movement during the year:Current tax on the adjusted profit for the year at 3%/15% (2017: 15%) 25,741 24,568 - -

Tax deducted at source (26,246) (19,159) - -CSR charge at 2% 444 - - -CSR for previous year at 2% 1,190 - - -Tax refund 17,561 16,444 - 2,464Underprovision in previous year 3,111 291 - -

21,801 22,144 - 2,464Tax paid (20,950) (26,565) - -At December 31, (14,058) (14,909) (388) (388)Disclosed as follows:Current tax assets (19,589) (20,256) (388) (388)Current tax liabilities 5,531 5,347 - -

(14,058) (14,909) (388) (388)

THE GROUP THE COMPANY2018 2017 2018 2017

Basic loss per share - Rs (6.17) (6.28) (0.37) (1.49)Loss attributable to equityholders of the Company (Rs’000)- As previously stated (413,716) (423,590) (24,702) (100,585)- Effect of prior year adjustment (note 45(d)) - 788 - 764- As restated (413,716) (422,802) (24,702) (99,821)Number of ordinary shares in issue 67,012,404 67,012,404 67,012,404 67,012,404

13. TAXATION (cont’d)

(b) Current tax (assets)/liabilities

14. LOSS PER SHARE

15. PROPERTY, PLANT AND EQUIPMENT(a) THE GROUP


THE GROUP Freehold land

Rs’000Buildings

Rs’000

Leasehold properties

Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000

Work in progressRs’000

Bearer plantsRs’000

TotalRs’000

2018

Valuation/Cost 8,836,848 1,065,526 109,789 6,386,036 995,142 1,859,390 2,030,709 245,641 527,873 22,056,954Accumulated depreciation - (201,378) (19,018) (3,025,351) (428,872) (597,801) (701,547) - (385,680) (5,359,647)

Net book value 8,836,848 864,148 90,771 3,360,685 566,270 1,261,589 1,329,162 245,641 142,193 16,697,307

2017

Valuation/Cost 8,834,423 987,789 111,346 5,222,937 995,142 1,684,531 1,948,298 1,124,105 490,195 21,398,766Accumulated depreciation - (177,783) (11,702) (2,747,926) (428,872) (524,843) (509,458) - (347,091) (4,747,675)

Net book value 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091

NET BOOK VALUE


Rs’000Buildings

Rs’000


Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000



TotalRs’000

2018

At January 1, 2018

- As previously stated 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091- Effect of changes in

accounting policies(note 45(c))

8,897 - - - - - - - - 8,897

- As restated 8,843,320 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,659,988

Revaluation (850) - - - - - - - - (850)

Additions 3,951 77,737 2,905 264,461 - 10,650 87,111 184,004 37,678 668,497

Disposals (16,134) - (4,462) - - - (9,284) - - (29,880)

Depreciation - (23,595) (7,316) (277,425) - (72,958) (192,089) - (38,589) (611,972)

Transfers - - - 898,638 - 164,209 - (1,062,847) - -Transfer to non-current assets held for sale (note 28)

(4,999) - - - - - - - - (4,999)

Transfer to deferred project - - - - - - - 379 - 379

Consolidation adjustment 11,560 - - - - - 4,584 - - 16,144

At December 31, 2018 8,836,848 864,148 90,771 3,360,685 566,270 1,261,589 1,329,162 245,641 142,193 16,697,307




NET BOOK VALUE


Rs’000Buildings

Rs’000


Rs’000

Power plant and

equipmentsRs’000

Factory equipment

Rs’000

Refinery plant

Rs’000

Plant and equipment

Rs’000



TotalRs’000

2017

At January 1, 2017 6,272,889 815,925 106,755 2,717,817 626,026 1,196,861 1,479,254 870,708 144,216 14,230,451

Revaluation surplus 2,558,707 - - - - - - - - 2,558,707

Additions - 5,616 793 29,908 - 32,267 89,557 228,706 38,562 425,409

Disposals (15,962) - - (8) - - (6,730) - - (22,700)

Depreciation - (22,524) (7,904) (272,706) (59,756) (69,440) (127,354) - (39,674) (599,358)Transfer from intangi-ble assets (note 16) - - - - - - 2,901 - - 2,901

Transfer to intangible assets (note 16) - - - - - - - (114) - (114)

Transfer from non-current asset held for sale (note 28)

7,158 - - - - - - - - 7,158

Transfer from deferred project expenses - - - - - - - 11,362 - 11,362

Consolidation adjustment 14,493 - - - - - - - - 14,493

Transfer from Land debtors 11,793 10,989 - - - - - - - 22,782

Transfers (14,655) - - - - - 1,212 13,443 - -

At December 31, 2017 8,834,423 810,006 99,644 2,475,011 566,270 1,159,688 1,438,840 1,124,105 143,104 16,651,091


NET BOOK VALUE

THE COMPANYFreehold

landRs’000

BuildingsRs’000


Rs’000

Plant and equipment

Rs’000Bearer plants

Rs’000Total

Rs’0002018At January 1, 2018- As previously reported 5,054,705 75,532 2,467 52,859 104,285 5,289,848- Effect of changes in accounting policies ( note 45(c)) 519 - - - - 519- As restated 5,055,224 75,532 2,467 52,859 104,285 5,290,367Additions - 64,040 - 11,440 30,127 105,607Disposals (511) - - (1,919) - (2,430)Transfer from non-current asset held for sale (note 28) (4,999) - - - - (4,999)Depreciation - (4,147) - (15,834) (28,648) (48,629)At December 31, 2018 5,049,714 135,425 2,467 46,546 105,764 5,339,916

2017At January 1, 2017 4,398,794 64,010 2,467 60,448 105,092 4,630,811Additions - 2,480 - 9,510 28,392 40,382Disposals (10,496) - - (565) - (11,061)Transfer from non-current asset held for sale (note 28) 7,158 - - - - 7,158Transfer from Land debtors 11,792 10,989 - - - 22,781Depreciation - (1,947) - (16,534) (29,199) (47,680)Revaluation surplus 647,457 - - - - 647,457At December 31, 2017 5,054,705 75,532 2,467 52,859 104,285 5,289,848

THE COMPANY Freehold landRs’000

BuildingsRs’000


Rs’000

Plant and equipment

Rs’000Bearer plants

Rs’000Total

Rs’0002018Valuation/Cost 5,049,714 167,981 4,915 344,246 361,992 5,928,848Accumulated depreciation - (32,556) (2,448) (297,700) (256,228) (588,932)Net book value 5,049,714 135,425 2,467 46,546 105,764 5,339,916

2017Valuation/Cost 5,054,705 103,941 4,915 334,725 331,865 5,830,151Accumulated depreciation - (28,409) (2,448) (281,866) (227,580) (540,303)Net book value 5,054,705 75,532 2,467 52,859 104,285 5,289,848

(c) Depreciation charge of Rs’000 611,972 (2017: Rs’000 599,358) for the Group and Rs’000 48,629 (2017: Rs’000 47,680) for the Company has been included under operating expenses.



15. PROPERTY, PLANT AND EQUIPMENT (cont’d)

(b) THE COMPANY (cont’d)


(a) THE GROUP (cont’d)

(b) THE COMPANY


There were no transfers between levels during the year.

The fair value of land is classified in level 2 of the fair value hierarchy as it has been valued using observable market date but there is no active market.

In evaluating property to assess its estimate of likely value, the professional valuer has three approaches from which to select: the income capitalisation, cost and sales comparison approaches.

For the purpose of this valuation, the Sales Comparison Approach and the Depreciated Replacement Cost Approach have been used.

At December 31, 2018, the most significant observable inputs for the valuation of land are as follows:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At December 31,Freehold land Level 2 8,836,848 8,834,423 5,049,714 5,054,705

Range of observable inputRs’000/Ha

THE GROUPPrice per hectare 749 - 47,504THE COMPANYPrice per hectare 749 - 43,710


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Additions 668,497 425,409 105,607 40,382Additions under finance lease (32,317) (18,906) (7,670) (3,806)

636,180 406,503 97,937 36,576


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Cost - capitalised finance lease 242,758 210,441 42,813 41,283Accumulated depreciation (112,638) (104,599) (26,203) (23,447)Net book value 130,120 105,842 16,610 17,836


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Level 2At January 1,- As previously reported 8,834,423 6,272,889 5,054,705 4,398,794- Effect of changes in accounting policies ( note 45(c)) 8,897 - 519 -- As restated 8,843,320 6,272,889 5,055,224 4,398,794Consolidation adjustment 11,560 - - -Revaluation (850) - - -Additions 3,951 - - -Disposals (16,134) (15,962) (511) (10,496)Transfer from non-current assets held for sale (4,999) 7,158 - 7,158Transfer from land debtors - 11,793 (4,999) -Consolidation adjustment - 14,493 - -Transfers - (14,655) - 11,792Surplus on revaluation - 2,558,707 - 647,457At December 31, 8,836,848 8,834,423 5,049,714 5,054,705


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At December 31,Freehold land 947,292 944,422 919,845 920,356


(d) If the freehold land was stated on the historical cost basis, the amounts would be as follows:


(e) Significant increase/(decrease) in the above observable input, price per Hectare (Ha) in isloation would result in a significant higher/(lower) fair value.

The movement in the opening balance and closing balance of the property, plant and equipment categorised within level 2 of the fair value hierarchy is as follows:

(e) The Group’s/Company’s freehold land were last revalued at December 31, 2017 by Broll, independent valuers. The revaluation surplus net of applicable deferred income taxes was credited to revaluation surplus in shareholders’ equity (note 30).

The fair value of the land is based on its market value, which is defined as intended to mean the estimated amount for which an asset or liability should exchange on the valuation date between a willing buyer and a willing seller in an arm’s length transaction after proper marketing and where the parties had each acted knowledgeably, prudently, and without compulsion.

Details of the Group’s/Company’s freehold land measured at fair value and information about the fair value hierarchy as at December 31, 2018 is as follows:


(f) Borrowings are secured by floating charges on the assets of the Company or its subsidiaries, including property, plant and equipment (note 31).

(g) Non-cash transactions

(h) Assets under finance lease comprise transport equipment:




Software and profesional

feesRs’000

GoodwillRs’000

Land conver-sion rights

Rs’000

Energy management

contractsRs’000

Bond expenseRs’000

Rebranding costs

Rs’000Total

Rs’000

COSTAt January 1, 2017 114,768 77,424 1,081,511 555,200 75,549 11,333 1,915,785Additions 5,864 - 413,489 - 25,948 - 445,301Disposals - - - (257,782) - - (257,782)Transfer from property, plant and equipment (note 15) - - - - - 114 114 Transfer to property, plant and equipment (note 15) (3,053) - - - - - (3,053)At December 31, 2017 117,579 77,424 1,495,000 297,418 101,497 11,447 2,100,365Additions - net 9,890 - - - - - 9,890At December 31, 2018 127,469 77,424 1,495,000 297,418 101,497 11,447 2,110,255

AMORTISATIONAt January 1, 2017 65,998 - 12,564 134,277 41,551 5,733 260,123Transfer to property, plant and equipment (note 15) (152) - - - - - (152)Charge for the year 8,478 - - 13,595 9,973 567 32,613At December 31, 2017 74,324 - 12,564 147,872 51,524 6,300 292,584Charge for the year 9,202 - - 13,595 8,526 699 32,022At December 31, 2018 83,526 - 12,564 161,467 60,050 6,999 324,606

NET BOOK VALUEAt December 31, 2018 43,943 77,424 1,482,436 135,951 41,447 4,448 1,785,649

At December 31, 2017 43,255 77,424 1,482,436 149,546 49,973 5,147 1,807,781

Land conversion

rightsRs’000

Rebranding costs

Rs’000

Energy management

contractsRs’000

Bond expenses

Rs’000OthersRs’000

TotalRs’000

COSTAt January 1, 2017 - 1,039 219,500 75,548 17,008 313,095Additions 301,118 - - 25,947 1,501 328,566Disposals - - (219,500) - - (219,500)At December 31, 2017 301,118 1,039 - 101,495 18,509 422,161Additions - - - - 162 162At December 31, 2018 301,118 1,039 - 101,495 18,671 422,323

AMORTISATIONAt January 1, 2017 - 416 - 41,552 14,318 56,286Charge for the year - 52 - 9,973 1,500 11,525At December 31, 2017 - 468 - 51,525 15,818 67,811Charge for the year - 52 - 8,526 1,574 10,152At December 31, 2018 - 520 - 60,051 17,392 77,963

NET BOOK VALUEAt December 31, 2018 301,118 519 - 41,444 1,279 344,360

At December 31, 2017 301,118 571 - 49,970 2,691 354,350


16. INTANGIBLE ASSETS

(a) THE GROUP

16. INTANGIBLE ASSETS (cont’d)

(b) THE COMPANY

(c) Amortisation charge of Rs’000 32,022 (2017: Rs’000 32,613) for the Group and Rs’000 10,152 (2017: Rs’000 11,525) for the Company has been included under operating expenses.

(d) Goodwill is allocated to the cash generating units. The carrying amount of goodwill had been allocated as follows:

THE GROUP

2018 and 2017Rs’000

Floréal Limited 427Omnicane Agricultural Operations Limited 20,152Omnicane Milling Holdings (Britannia Highlands) Limited 6,077Omnicane Thermal Energy Holdings (St Aubin) Limited 46,597Refad Rwanda Ltd 4,171

77,424




THE COMPANY 2018Rs’000

2017Rs’000

COSTAt January 1, 4,947,661 4,946,561Additions 100,000 1,100Impairment (note 12) (39,054) -At December 31, 5,008,607 4,947,661


17. INVESTMENT IN SUBSIDIARY COMPANIES

2018 2017% Holding Amount % Holding Amount

CompaniesTypes of

shares held ActivityHeld

directly

Held by other group companies Rs’000 Held directly

Held by other group companies Rs’000

Direct HoldingOmnicane Milling Holdings (Mon Trésor) Limited Ordinary Investment 80 - 118,242 80 - 118,242

Omnicane Milling Holdings (Britannia Highlands) Limited Ordinary Investment 80 - 272,037 80 - 272,037

Floréal Limited Ordinary Investment 100 - 3,188 100 - 3,188

FAW Investment Limited Ordinary Investment 100 - 148,205 100 - 148,205Omnicane Logistic Operations Limited Ordinary Transport 100 - 150,000 100 - 50,000

Omnicane Thermal Energy Holdings (St Aubin) Limited Ordinary Investment 100 - 287,271 100 - 287,271

Omnicane Holdings (La Baraque) Thermal Energy Limited Ordinary Investment 100 - 535,221 100 - 535,221

Omnicane Wind Energy Limited Ordinary Energy 100 - 0.1 100 - 0.1Omnicane Britannia Wind Farm Operations Limited Ordinary Energy 100 - 0.1 100 - 0.1

Omnicane Ethanol Holdings Limited Ordinary Investment 60 - 105,155 60 - 105,155

Airport Hotel Ltd Ordinary Hotel 51 10 174,120 51 10 213,174

Omnicane Africa Investment Ltd Ordinary Investment 100 - 1 100 - 1La Baraque Maintenance And Services Ltd Ordinary Security 100 - 1 100 - 1

Omnicane International Invest-ment Co Ltd Ordinary Investment 100 - 525,033 100 - 525,033

Omnicane Hydro Energy Limited Ordinary Management 100 - 100 100 - 100

Blueport Investment Limited Ordinary Real Estate 100 - 100 100 - 100

Mon Trésor Smart City Ltd Ordinary Real Estate 100 - 2,684,197 100 - 2,684,197Mon Trésor Smart City Management Ltd Ordinary Real Estate 100 - 100 100 - 100

Omnicane Sugar Trading Ltd Ordinary Sale of refined sugar 100 - 100 100 - 100

Mon Trésor Retail Ltd Ordinary Retail 100 - 100 100 - 100Mon Trésor Business Gateway Phase 1 Ltd Ordinary Real Estate 100 - 1,000 100 - 1,000

Refad Rwanda Ltd Ordinary Energy 51 - 4,436 51 - 4,436

Mon Trésor Gateway Ltd * Ordinary Real Estate 100 - 1,000 - - 1,000

5,009,607 4,948,661

(a) Subsidiaries of Omnicane Limited

17. INVESTMENT IN SUBSIDIARY COMPANIES (cont’d)

(a) Subsidiaries of Omnicane Limited (cont’d)

2018 2017% Holding Amount % Holding Amount

CompaniesTypes of

shares held ActivityHeld

directly

Held by other group companies Rs’000 Held directly

Held by other group companies Rs’000

Indirect HoldingOmnicane Milling Operations Limited Ordinary Sugar Milling - 80 390,888 - 80 390,888

Omnicane Agricultural Operations Limited Ordinary Sugar Growing - 100 10,400 - 100 10,400

Omnicane Thermal Energy Operations (St Aubin) Limited Ordinary Energy - 60 153,000 - 60 153,000

Omnicane Thermal Energy Operations (La Baraque) Limited Ordinary Energy - 60 456,600 - 60 456,600

Thermal Valorisation Co Ltd Ordinary Energy - 65 191,100 - 65 191,100

Omnicane Ethanol Production Ltd Ordinary Ethanol - 100 10 - 100 10Omnicane Bio-Ethanol Operations Limited Ordinary Ethanol - 100 142,368 - 100 142,368

Omnicane Heat and Power Services Ltd Ordinary Energy - 100 200,000 - 100 200,000

Trade Park Mon Trésor Limited Ordinary Real Estate - 100 520,933 - 100 520,933Mon Trésor Residences Phase 1 Ltd Ordinary Real Estate - 100 1 - 100 1

Mon Trésor Development and Training Center Ltd Ordinary Investment - 100 100,000 - 100 100,000

Mon Trésor Gateway Ltd * Ordinary Real Estate 100 - 1,000 - - -Mon Trésor Studio Operations & Management Ltd * Ordinary Cinemato-

graphy - 100 1,000 - - -

Mon Trésor Studio Property Ltd * Ordinary Real Estate - 100 1,000 - - -

The financial statements of all the above subsidiaries, included in the consolidated financial statements, are co-terminous with those of the holding company. Except for FAW Investment Limited, which is incorporated in the Isle of Man and Refad Rwanda Ltd, incorporated in Rwanda, all the subsidiary companies are incorporated in the Republic of Mauritius.

* Acquisition of subsidiaries during the year.




Profit/(loss) allocated to non-controlling interests

during the yearRs’000

Accumulated non-controlling interests at

December 31,Rs’000

2018Omnicane Ethanol Holdings Limited 19,166 221,970 Omnicane Thermal Energy Operations (St Aubin) Limited 38,786 239,598 Omnicane Thermal Energy Operations (La Baraque) Limited 57,788 479,402 Omnicane Milling Operations Limited (73,104) 40,017 Airport Hotel Ltd (9,461) 105,150

2017Omnicane Ethanol Holdings Limited 76,191 273,634 Omnicane Thermal Energy Operations (St Aubin) Limited 36,995 241,948 Omnicane Thermal Energy Operations (La Baraque) Limited 70,783 479,084 Omnicane Milling Operations Limited (61,338) (50,657)Airport Hotel Ltd (9,324) 86,438


(b) Subsidiaries with material non-controlling interests

Details of subsidiaries that have non-controlling interests that are material to the entity:

(c) Summarised financial information on subsidiaries with material non-controlling interests

(i) Summarised statements of financial position and statements of profit or loss and other comprehensive income


Current assetsRs’000

Non- current assetsRs’000

Current liabilitiesRs’000

Non- current

liabilitiesRs’000

RevenueRs’000

Profit/(loss) for the year

Rs’000

Other comprehensive income for the

yearRs’000

Total comprehensive income for the

yearRs’000

Dividend paid to non-

controlling interestsRs’000

2018Omnicane Ethanol Holdings Limited 166,571 1,033,052 307,065 336,912 558,316 47,915 (6,198) 41,717 -

Omnicane Thermal Energy Operations (St Aubin) Limited 483,560 676,596 373,297 187,902 939,602 96,965 (2,450) 94,515 (30,000)

Omnicane Thermal Energy Operations (La Baraque) Limited

924,498 2,407,138 1,381,418 751,714 1,645,462 144,471 (1,869) 142,602 (60,000)

Omnicane Milling Operations Limited 326,729 2,930,787 2,449,942 607,488 606,642 (365,521) 26,890 (338,631) -

Airport Hotel Ltd 30,617 704,430 255,253 265,200 158,036 (19,308) 12,264 (7,044) -

2017Omnicane Ethanol Holdings Limited 216,560 1,064,665 384,573 378,206 367,980 191,874 39,927 231,801 -

Omnicane Thermal Energy Operations (St Aubin) Limited 486,007 715,269 304,496 301,664 896,675 95,187 (143) 95,044 (36,000)

Omnicane Thermal Energy Operations (La Baraque) Limited

1,028,975 3,671,359 910,192 2,305,968 2,048,145 178,748 21,955 200,703 (80,000)

Omnicane Milling Operations Limited 439,658 3,442,609 3,194,123 713,950 854,328 (306,690) (51,320) (358,009) -

Airport Hotel Ltd 36,985 724,817 210,651 328,374 161,412 (23,268) 10,699 (12,569) -


(c) Summarised financial information on subsidiaries with material non-controlling interests (cont’d)

(ii) Summarised cash flow information

18. INVESTMENT IN ASSOCIATED COMPANIES

Operating activitiesRs’000

Interesting activitiesRs’000

Financing activitiesRs’000

Net increase/(decrease) in

cash and cash equivalents

Rs’0002018Omnicane Ethanol Holdings Limited 74,466 (7,480) (59,995) 6,991Omnicane Thermal Energy Operations (St Aubin) Limited 153,816 (52,123) (177,313) (75,620)Omnicane Thermal Energy Operations (La Baraque) Limited 314,550 (87,353) (315,859) (88,662)Omnicane Milling Operations Limited 131,969 (118,552) (54,489) (41,072)Airport Hotel Ltd 62,563 (7,517) (53,850) 1,196

2017Omnicane Ethanol Holdings Limited (8,048) (9,248) (85,703) (102,999)Omnicane Thermal Energy Operations (St Aubin) Limited 188,140 31,947 (235,486) (15,399)Omnicane Thermal Energy Operations (La Baraque) Limited 445,336 (50,383) (436,837) (41,884)Omnicane Milling Operations Limited 191,920 (101,946) (33,376) 56,598Airport Hotel Ltd (10,331) (1,635) (53,893) (65,859)

The summarised financial information above is the amount before intra-group eliminations.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1,- As previously reported 964,672 1,060,957 11,463 11,463- Effect of prior year changes (note 45) (882,875) - (6,176) -- As restated 81,797 1,060,957 5,287 11,463Additions - 43,329 - -Share of loss in associates (1,953) (155,950) - -Share of other comprehensive income - 16,336 - -At December 31, 79,844 964,672 5,287 11,463




Name Year end

Principle place of business Nature of business

Direct Interest

%

Indirect Interest

%AssetsRs’000

LiabilitiesRs’000

RevenueRs’000

Profit/(loss)Rs’000

2018

Maref Mon Trésor Investment 1 Ltd December 31, Mauritius Real Estate - 19.76 176,267 202,046 12,568 3,047

Kwale International Sugar Company Limited**

December 31, Kenya Sugar Growing - 20.00 12,297,837 7,732,421 1,153,567 (355,251)

Coal Terminal (Management) Co. Ltd December 31, Mauritius Distributor of coal - 24.43 20,768 17,254 82,376 236

Copesud (Mauritius) Ltée December 31, Mauritius Agricultural products 25.00 - 46,420 19,941 67,341 6,156

2017

Maref Mon Trésor Investment 1 Ltd December 31, Mauritius Real Estate - 19.76 387,093 346,265 - (2,577)

Kwale International Sugar Company Limited**

December 31, Kenya Sugar Growing - 20.00 10,496,782 10,980,913 339,497 25,772

Coal Terminal (Management) Co. Ltd December 31, Mauritius Distributor of coal - 24.43 28,365 25,088 73,652 540

Copesud (Mauritius) Ltée December 31, Mauritius Agricultural products 25.00 - 42,075 21,751 60,832 1,406

The Real Good Food plc* March 31, United

KingdomManufacturer and distributor of food & industrial ingredients

- 27.96 7,009,007 3,204,567 2,901,302 (314,070)

All of the above associates are accounted for using the equity method.

* For group accounts purpose, unaudited figures for the period ended September 30, 2017 have been used. At January 1, 2018, the investment has been reassessed under IFRS 9 and has been transferred to investment in financial asset at fair value through Other Comprehensive Income (note 19).

** For group accounts purpose, audited figures for the year ended December 31, 2016 have been used (2017: year ended December 31, 2015).


Rs’0002018

Rs’000At January 1 1,181,831 4,481Additions - 800,000Disposals (3,648) (3,648)Change in fair value recognised in other comprehensive income (85,067) 3At December 31 1,093,116 800,836


Rs’0002018

Rs’000Quoted:Equity securities – [Mauritius] 221,425 32Equity securities – [United Kingdom] 749,174 -Debt securities 121,713 -Unquoted:Equity securities - [Mauritius] 804 800,804

1,093,116 800,836

18. INVESTMENT IN ASSOCIATED COMPANIES (cont’d)

(i) The results of the following associated companies have been included in the consolidated financial statements:

19. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (a) Equity investments at fair value through other comprehensive income


(b) Fair value through other comprehensive income financial assets include the following:

(c) Financial assets measured at fair value through other comprehensive income include the Group’s strategic equity investments not held for trading and debt securities held to collect and sell. The Group has made an irrevocable election to classify the equity investments at fair value through other comprehensive income rather than through profit or loss because this is considered to be more appropriate for these strategic investments. In 2017, the Group had designated the investments as available-for-sale (note 20) where management intended to hold them for the medium to long-term.

(d) The fair value of quoted securities is based on published market prices. The fair value of the unquoted securities are based on expected cash flows discounted using a rate based on the market interest rate and the risk premium specific to the unlisted securities.





Rs’0002018

Rs’000Quoted:ENL Limited 221,383 -The Real Good Food plc 749,174 -Ireland Blyth Limited 30 30Sun Resort Limited 2 2Mauritius Commercial Bank Ltd - 6% 10 years loan notes 60,806 -State Bank of Mauritius - 6% Class A bonds 60,917 -Unquoted:Rey & Lenferna Ltd 802 802Omnicane Foundation Ltd 2 2Omnicane Milling Operations Limited ( Class B Shares) - 800,000

1,093,116 800,836

2017

THE GROUPLevel 1Rs’000

Level 2Rs’000

Level 3Rs’000

TotalRs’000

At January 1, 124,455 141,029 6,226 271,710Change in fair value (146) 29,152 - 29,006Write offs - - (1,760) (1,760)At December 31, 124,309 170,181 4,466 298,956

2017

THE COMPANYLevel 1Rs’000

Level 3Rs’000

TotalRs’000

At January 1, 16 6,221 6,237Change in fair value 4 - 4Write offs - (1,760) (1,760)At December 31, 20 4,461 4,481


Rs’0002017

Rs’000Debt securities at fair value:- Listed 124,292 -Equity Securities at fair value:- Listed 170,203 20- Unlisted 4,461 4,461

298,956 4,481

20. INVESTMENT IN FINANCIAL ASSETS

Available-for-sale

(a) The movements in investments in financial assets may be summarised as follows:

20. INVESTMENT IN FINANCIAL ASSETS (cont’d)

Available-for-sale (cont’d)

(a) The movements in investments in financial assets may be summarised as follows: (cont’d)

(b) Available-for-sale financial assets includes the following:

(c) At December 31, 2017, the directors reviewed the carrying amounts of unquoted investments and in their opinion, there is no objective evidence that the investments should be impaired.

(d) Available-for-sale financial assets are denominated in Mauritian rupee.

(e) All the debt have fixed coupon rates (fixed rate at 6%).

(f) None of the financial assets are either past due or impaired.


19. FINANCIAL ASSETS AT FAIR VALUE THROUGH OTHER COMPREHENSIVE INCOME (cont’d)

(e) Fair value through other comprehensive income financial assets include the following:

(f) Financial asset at fair value through Other Comprehensive Income are denominated in Mauritian rupee.

(g) Impairment and risk exposureAll of the entity’s debt investments at fair value through Other Comprehensive Income are considered to have low credit risk and the loss allowance recognised during the period was therefore limited to 12 months expected losses.

The loss allowance for debt investments at fair value through Other Comprehensive Income is recognised in profit or loss and reduces the fair value loss otherwise recognised in Other Comprehensive Income. At January 1 and December 31, 2018, the identified impairment loss was immaterial.

THE GROUP2018

THE COMPANY2018

Non-currentRs’000

CurrentRs’000

Non-currentRs’000

CurrentRs’000

Receivable from related parties 1,213,080 1,284,722 2,018,770 3,912,923Other receivables (note 21(a))- Land under development - 382,783 - 382,783- Deferred project expenses 195,403 - 14,957 -- Prepayments and other receivables - 463,836 - 48,566

1,408,483 2,131,341 2,033,727 4,344,272Less: Loss allowance for financial assets at amortised cost (note 21(b)) (345,210) (45,072) (466,011) (24,113)

1,063,273 2,086,269 1,567,716 4,320,159

21. FINANCIAL ASSETS AT AMORTISED COST




(a) Non-current receivables are disclosed under financial assets at amortised cost (note 21) for 2018. In 2017, long term receivables with fixed maturity terms were measured at amortised cost using the effective interest rate method, less provision for impairment. The carrying amount of the asset was reduced by the difference between the asset’s carrying amount and the present value of estimated cash flows discounted using the original effective interest rate. The amount of loss was recognised in profit or loss. If there were objective evidence that an impairment loss had been incurred, the amount of impairment loss was measured as the difference between the carrying amount of the asset and the present value (PV) of estimated cash flows discounted at the current market rate of return of similar financial assets.

(b) For the Group, non-current receivables in respect of loan amount to Kwale International Sugar Company Limited, an associated company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(i) For the Company, non-current receivables in respect of loan amount to Omnicane Africa Investment Limited, a wholly owned subsidiary company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(ii) The carrying amounts of the loans for both the Group and the Company approximates their fair values.

(a) Other receivables These amounts generally arise from transactions outside the usual operating activities of the Company. Interest may be charged at commercial rates where the terms of repayment exceed six months. Collateral is not normally obtained. The non-current other receivables are due and payable other one year from the end of the reporting period.

(b) Impairment and risk exposure

(i) The loss allowance for financial assets at amortised cost as at December 31, 2017 reconciles to the opening loss allowance on January 1, 2018 and to the closing loss allowance as at December 31, 2018 as follows:

(ii) All of the financial assets at amortised cost are denominated in Mauritian rupees. As a result, there is no exposure to foreign currency risk. There is also no exposure to price risk as the investments will be held to maturity.

(c) For the Group, non-current receivables in respect of loan amount to Kwale International Sugar Company Limited, an associated company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

THE GROUP Related partiesRs’000

Other receivablesRs’000

TotalRs’000

Loss allowance at 31 December 2017 (IAS 39) - - -Amounts restated through opening retained earnings 345,210 45,072 390,282Loss allowance at January 1, 2018 (IFRS 9) 345,210 45,072 390,282Allowance recognised in profit or loss during the year - - -Loss allowance at December 31, 2018 345,210 45,072 390,282

THE COMPANY Related partiesRs’000

Other receivablesRs’000

TotalRs’000

Loss allowance at 31 December 2017 (IAS 39) - - -Amounts restated through opening retained earnings 466,011 24,073 490,084Loss allowance at January 1, 2018 (IFRS 9) 466,011 24,073 490,084Allowance recognised in profit or loss during the year 24 40 64Loss allowance at December 31, 2018 466,035 24,113 490,148

(d) For the Company, non-current receivables in respect of loan amount to Omnicane Africa Investment Limited, a wholly owned subsidiary company of Omnicane Limited, bears interest of 3 months Libor plus 7% per annum.

(e) The carrying amounts of the loans for both the Group and the Company approximates their fair values.

(f) The other financial assets at amortised cost were accounted for as receivables in the previous year.

22. NON-CURRENT RECEIVABLESTHE GROUP THE COMPANY

2017Rs’000

2017Rs’000

As at January 1, 1,027,839 1,167,670Additions 54,493 117,380Gain on retranslation of non-current receivables 95,623 -

1,177,955 1,285,050

21. FINANCIAL ASSETS AT AMORTISED COST (cont’d)


23. DEFERRED TAX (ASSETS)/LIABILITIES

Deferred income tax is calculated on all temporary differences under the liability method at 3%/17% (2017: 3%/15%).

(a) There is a legally enforceable right to offset current tax assets against current tax liabilities and deferred income tax assets and liabilities when the deferred income taxes relate to the same fiscal authority on the same entity.

The following amounts are shown on the statements of financial position:


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Deferred tax assets (75,894) (93,639) (18,045) (26,159)Deferred tax liabilities 374,242 342,725 - -

298,348 249,086 (18,045) (26,159)




At the end of the reporting year, the Group had unused tax losses of Rs’000 1,736,330 (2017: Rs’000 1,818,838) and the Company had unused tax losses of Rs’000 303,837 (2017: Rs’000 303,837) available for offset against future profits. Deferred tax assets have been recognised in respect of Rs’000 1,148,634 (2017: Rs’000 1,323,620) for the Group and for the Company Rs’000 34,740 (2017: Rs’000 34,740) of such losses. No deferred tax asset has been recognised in respect of the remaining tax losses for the Group due to unpredictability of future profit stream.

As at December 31, 2018, the unused tax losses are classified as follows:


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Unused tax losses at end of the reporting date 1,736,330 1,818,838 303,837 303,837Deferred tax assets recognised on tax losses 77,532 109,893 5,906 5,906Deferred tax assets not recognised on tax losses 164,602 80,201 45,746 45,746

(b) Tax losses


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000Carried forward indefinitely 1,103,736 1,076,456 34,742 34,742Expiring on a rolling basis over 5 years 575,355 742,382 269,095 269,095

1,679,091 1,818,838 303,837 303,837


2018Rs’000

Restated2017

Rs’0002018

Rs’000

Restated2017

Rs’000At January 1, - as previously reported 218,143 151,960 (23,081) (17,355)- effect of change in the effective tax rate (note 45(d)) 30,943 29,848 (3,078) (2,314)- as restated 249,086 181,808 (26,159) (19,669)Charged/(credited) to profit or loss (note 13(a)) 47,266 69,334 6,428 (4,709)Charged/(credited) to other comprehensive income 1,996 (2,054) 1,686 (1,781)At December 31, 298,348 249,088 (18,045) (26,159)

(c) Movement on the deferred income tax account:

(d) The movement in deferred tax assets and liabilities during the year, without taking into consideration the offsetting of balances within the same fiscal authority on the same entity is as follows:

THE GROUPAccelerated tax

depreciationRs’000

Bearer biological assetsRs’000

TotalRs’000

Deferred tax liabilitiesAt January 1, 2017- as previously reported 388,004 15,765 403,769- effect of change in the effective tax rate (note 45(d)) 40,084 2,102 42,186- as restated 428,088 17,867 445,955Charged to income statements (35,278) (138) (35,416)At January 1, 2018 392,810 17,729 410,539Credited to income statements 18,201 250 18,451At December 31, 2018 411,011 17,979 428,990

Tax lossesRs’000

Retirement benefit obligations

Rs’000Total

Rs’000Deferred tax assetsAt January 1, 2017- as previously reported (193,900) (57,909) (251,809)- effect of change in the effective tax rate (note 45(d)) (7,416) (4,922) (12,338)- as restated (201,316) (62,831) (264,147)Charged to income statements 91,423 13,327 104,750Credited to statement of comprehensive income - (2,053) (2,053)At January 1, 2018 (109,893) (51,557) (161,450)Charged/(credited) to income statements 32,361 (3,548) 28,813Charged to statement of comprehensive income - 1,996 1,996At December 31, 2018 (77,532) (53,109) (130,641)


23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d) 23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d)




23. DEFERRED TAX (ASSETS)/LIABILITIES (cont’d)

24. INVENTORIES

THE COMPANYAccelerated tax

depreciationRs’000

Bearer biological assetsRs’000

TotalRs’000

Deferred tax liabilitiesAt January 1, 2017- as previously reported 2,274 15,764 18,038- effect of change in the effective tax rate (note 45(d)) 303 2,102 2,405 - as restated 2,577 17,866 20,443Charged/(credited) to income statements 873 (138) 735At January 1, 2018 3,450 17,728 21,178Charged to income statements 9,715 252 9,967At December 31, 2018 13,165 17,980 31,145

Tax lossesRs’000

Retirement benefit obligations

Rs’000Total

Rs’000Deferred tax assetsAt January 1, 2017- as previously reported (2,784) (32,609) (35,393)- effect of change in the effective tax rate (note 45(d)) (372) (4,347) (4,719)- as restated (3,156) (36,956) (40,112)Credited to income statements (2,750) (2,694) (5,444)Credited to statement of comprehensive income - (1,781) (1,781)At January 1, 2018 (5,906) (41,431) (47,337)Credited to income statements (3,539) (3,539)Charged to statement of comprehensive income - 1,686 1,686At December 31, 2018 (5,906) (43,284) (49,190)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Spare parts and consumables - Growing 8,571 9,719 8,571 9,719 - Milling 65,612 82,818 - - - Energy production 533,648 519,431 - - - Ethanol & Molasses 104,549 159,514 - - - Logistics & Hotel 9,236 8,910 - -

721,616 780,392 8,571 9,719

(i) The cost of inventories recognised as expense and included under operating expenses amounted to Rs’000 1,759,133 (2017: Rs’000 1,781,066) for the Group and Rs’000 43,754 (2017: Rs’000 49,442) for the Company.

(ii) The bank borrowings are secured by floating charges on the assets of the Company or its subsidiaries, including inventories (note 31).

25. CONSUMABLE BIOLOGICAL ASSETS

26. RECEIVABLE FROM RELATED PARTIES

Consumable biological assets represent the fair value of standing canes. The fair value has been arrived at by discounting the present value of expected net cash flows at the relevant market determined pre-tax rate. The expected cash flows have been computed by estimating the expected crop, the sugar extraction rate and the forecasts of sugar prices which will prevail in the coming year. The harvesting costs and other direct costs are based on yearly budgets.

The fair value measurements for standing canes have been categorised as Level 3 fair values based on the inputs to the valuation techniques used.

At December 31, 2018, standing canes comprised approximately 2,366 hectares of cane plantations (2017: 2,381 hectares) for the Group and 1,881 hectares (2017: 1,883 hectares) for the Company.

During the year, the Group harvested approximately 262,177 tons of canes (2017: 211,000 tons) and the Company harvested 144,920 tons (2017: 156,000 tons).


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Standing canes (at fair value)At January 1, 58,291 118,465 38,833 87,629Additions - 1,428 - -Loss arising from changes in fair value (2,164) (61,602) (1,692) (48,796)At December 31, 56,127 58,291 37,141 38,833

THE GROUP THE COMPANY2018 2017 2018 2017

The principal assumptions used are:Expected price of sugar per ton (Rs) 11,250 12,500 11,250 12,500Expected sugar accruing (tons) 16,940 16,929 12,585 12,575Expected average extraction rate (%) 10.15 9.72 10.33 10.28


Rs’0002017

Rs’000Subsidiary companies - 4,040,297Companies with common directors 1,354 1,354Associated companies 720,568 340,798Subsidiaries of holding company 140,808 122,563Other related companies 130,594 77,169

993,324 4,582,181

Receivable from related parties are classified under financial assets at amortised cost (note 21) for 2018. In 2017, receivable from related parties bears interest between 6% to 7.65% per annum.





27. TRADE AND OTHER RECEIVABLES (cont’d)

(d) The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.

(e) In 2017, the impairment of trade receivables was assessed based on the incurred loss model. Individual receivables which were known to be uncollectible were written off by reducing the carrying amount directly. The other receivables were assessed collectively to determine whether there was objective evidence that an impairment had been incurred but not yet been identified. For these receivables the estimated impairment losses were recognised in a separate provision for impairment.

28. NON-CURRENT ASSETS HELD FOR SALE

THE GROUPMorcellement

land (note 28(c))

Rs’000

Factory equipment (note 28(d))

Rs’000

Total2018

Rs’000

Total2017

Rs’000At January 1, 2018- As previously reported 32,949 12,893 45,842 68,753- Effect of changes in accounting policies (note 45(c)) 31,955 - 31,955 -- As restated 64,904 12,893 77,797 68,753Transfer from property, plant and equipment (note 15) 4,999 - 4,999 -Transfer to property, plant and equipment (note 15) - - - (7,158)Transfer to other financial assets at amortised cost (note 21) (25,747) - (25,747) -Disposals (17,559) - (17,559) (15,753)At December 31, 2018 26,597 12,893 39,490 45,842

Morcellement land (note 28(c))

THE COMPANYTotal2018

Rs’000

Total2017

Rs’000At January 1,- As previously reported 32,949 55,860- Effect of changes in accounting policies (note 45(c)) 31,955 -- As restated 64,904 55,860Transfer from property, plant and equipment (note 15) 4,999 -Transfer to property, plant and equipment (note 15) - (7,158)Transfer to other financial assets at amortised cost (note 20) (25,747) -Disposals (17,559) (15,753)At December 31, 26,597 32,949

(c) Omnicane Limited has embarked on the development of Morcellement Fairview and the freehold land earmarked for this Morcellement has been reclassified as held for sale in financial year 2016. During the year, part of the Morcellement land has been transferred from property, plant and equipment and part has been disposed of. Unsold lots for Morcellement Fairview has been transferred to other financial assets at amortised cost. The remaining balance represents the unsold lots for Morcellement Highlands Rose.

(d) One of the subsidiaries (Omnicane Milling Operations Limited) intends to dispose part of factory equipment of Union St. Aubin and Mon Trésor which was part of the Company’s milling operations.

(a)

(b)

27. TRADE AND OTHER RECEIVABLES

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.

(a) Trade debtors represent mainly electricity, ethanol and sugar proceeds receivable. The sugar proceeds receivable are paid by the Mauritius Sugar Syndicate (MSS) as and when proceeds are received. Advances on sugar proceeds are paid on a weekly basis and the final settlement for the crop year is made at latest in June of the following year. Refined sugar become receivable as and when the Group invoices the MSS.

Electricity and refined sugar proceeds receivable are generally paid within one month.

(b) Other receivables are classified under financial assets at amortised cost (note 21) for 2018.

(c) Impairment of trade receivables The Group/Company applies the IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables.

To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due.

The expected loss rates are based on the payment profiles of sales over a period of 12 months before December 31, 2018 or January 1, 2018 respectively and the corresponding historical credit losses experienced within this period. The historical loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors affecting the ability of the customers to settle the receivables.

On that basis, the resulting loss allowance as at 31 December 2018 and 1 January 2018 (on adoption of IFRS 9) was not included in the financial statements as the identified impairment loss was immaterial.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Trade receivables (note 27(a)) 521,073 746,230 39,495 60,973Other receivables:- Prepayments and other receivables - 351,063 - 44,497- Deferred project expenses - 319,457 - 294,310- Land under development - 226,048 - 226,048

521,073 1,642,798 39,495 625,828

The carrying amount of trade and other receivables are denominated in the following currencies:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Mauritian Rupee 340,904 1,090,024 39,495 625,828Euro 125,385 109,931 - -US Dollar 54,784 442,843 - -

521,073 1,642,798 39,495 625,828





30. REVALUATION AND OTHER RESERVES (cont’d)

THE COMPANY Revaluation reserveRs’000

Available-for-sale

Fair value reserveRs’000

Financial assets at

FVOCIRs’000

Actuarial losses reserveRs’000

TotalRs’000

Balance at January 1, 2018 -- as previously stated 5,242,975 4,891 - (128,157) 5,119,709- effect of changes in accounting policies (note 45) - (4,891) 4,891 - -- as restated 5,242,975 - 4,891 (128,157) 5,119,709Remeasurement of defined benefit obligations - - - 8,232 8,232Increase in fair value of investment - - 3 - 3Transfer to retained earnings (4,951) - - - (4,951)Balance at December 31, 2018 5,238,024 - 4,894 (119,925) 5,122,993

Balance at January 1, 2017 5,613,122 4,887 - (118,062) 5,499,947Remeasurement of defined benefit obligations - - - (10,095) (10,095)Increase in fair value of investment - 4 - - 4Transfer to retained earnings (1,229,441) - - - (1,229,441)Land conversion rights 211,837 - - - 211,837Surplus on revaluation of land 647,457 - - - 647,457Balance at December 31, 2017 5,242,975 4,891 - (128,157) 5,119,709

Revaluation reserveThe revaluation reserve relates to the surplus on revaluation of land and land conversion rights.

Available-for-sale fair value reserveFair value reserve comprises the cumulative net change in the fair value of financial assets at fair value through other comprehensive income that has been recognised in other comprehensive income until the investments are derecognised or impaired. The balance was reclassified to financial assets at fair value through other comprehensive income on January 1, 2018.

Financial assets at fair value through other comprehensive income reserveGain/losses arising on financial assets at fair value through other comprehensive income. The balance was reclassified from available-for-sale fair value reserve at January 1, 2018.

Hedging reserveGains/losses arising on the effective portion of hedging instruments carried at fair value in a qualifying cash flow hedge.

Actuarial losses reserveThe actuarial losses reserve represents the cumulative remeasurement of defined benefit obligations recognised.

29. SHARE CAPITAL

THE GROUP AND THE COMPANY2018 & 2017

Rs’000Issued and Fully paid67,012,404 ordinary shares of Rs.7.50 each 502,593

The total authorised number of ordinary shares is 67,012,404 shares (2017: 67,012,404) with a par value of Rs.7.50 per share (2017: Rs.7.50). All issued shares are fully paid.

THE GROUP Revaluation reserveRs’000

Available-for-sale

Fair value reserveRs’000

Financial assets at

FVOCIRs’000

Hedging reserveRs’000

Actuarial losses reserveRs’000

Associate reserveRs’000

Translation reserveRs’000

Owners’ interestsRs’000

Balance at January 1, 2018 -- as previously stated 8,766,702 110,761 - (36,426) (193,871) (78,192) (6,983) 8,561,991- effect of prior year adjustments - - - - (38) - - (38)- effect of changes in accounting policies - (110,761) 110,761 - - - - -- as restated 8,766,702 - 110,761 (36,426) (193,909) (78,192) (6,983) 8,561,953Remeasurement of defined benefit obligations - - - - 17,648 - - 17,648Decrease in fair value of investments - - (84,036) - - - - (84,036)Loss on revaluation of land (510) - - - - - - (510)Transfer to retained earnings (5,667) - - - - - - (5,667)Cash flow hedge - - - 22,557 - - - 22,557Balance at December 31, 2018 8,760,525 - 26,725 (13,869) (176,261) (78,192) (6,983) 8,511,945

Balance at January 1, 2017- as previously stated 6,409,751 81,696 - (26,881) (176,189) (94,528) (1,454) 6,192,395- effect of prior year adjustments - - - - (45) - - (45)- as restated 6,409,751 81,696 - (26,881) (176,234) (94,528) (1,454) 6,192,350Remeasurement of defined benefit obligations - - - - (17,675) - - (17,675)Movement in associate reserve - - - - - 16,336 - 16,336 Increase in fair value of investment - 29,065 - - - - - 29,065 Land Conversion Rights 211,837 - - - - - - 211,837 Surplus on revaluation of land 2,546,109 - - - - - - 2,546,109 Transfer to retained earnings (400,995) - - - - - - (400,995)Cash flow hedge - - - (9,545) - - - (9,545)Currency translation differences - - - - - - (5,529) (5,529)Balance at December 31, 2017 8,766,702 110,761 - (36,426) (193,909) (78,192) (6,983) 8,561,953

30. REVALUATION AND OTHER RESERVES





30. REVALUATION AND OTHER RESERVES (cont’d)

Associated reserveThe associated reserve represents cumulative share of other comprehensive income of investments held in associated companies.

Translation reserveThe translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

31. BORROWINGS


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Non-currentBank loans (note 31(a)) 3,695,757 3,649,960 624,696 101,666Private Placement (note 31(e)) 2,500,000 2,500,000 2,500,000 2,500,000Loan from related party (note 31(f)) - 14,000 - -Bonds (note 31(d)) 1,590,000 1,800,000 1,590,000 1,800,000Finance lease liabilities (note 31(c)) 44,139 41,478 11,084 11,580

7,829,896 8,005,438 4,725,780 4,413,246CurrentBank overdrafts (note 31(b)) 1,421,850 1,430,460 1,135,499 1,196,898Bank loans (note 31(a)) 1,429,965 1,330,014 419,925 648,342Bonds (note 31(d)) 210,000 - 210,000 -Loan from related party (note 31(f)) 89,274 - - -Finance lease liabilities (note 31(c)) 24,809 26,062 7,002 7,366

3,175,898 2,786,536 1,772,426 1,852,606

Total borrowings 11,005,794 10,791,974 6,498,206 6,265,852

(a) Bank loansThe bank loans are secured by floating charges on the Company’s or subsidiaries’ assets, including property, plant and equipment and inventories (notes 15 and 24). The rates of interest on these loans vary between 5.30% and 8.50% (2017: 3.00% and 7.65%).

31. BORROWINGS (cont’d)

(b) Bank overdraftsThe bank overdrafts are secured by floating charges on the Company’s or subsidiaries’ assets. The rates of interest on bank overdrafts vary between 4.25% and 7.25% at year end (2017: 4.25% and 7.25%).

(c) Finance lease liabilities - minimum lease payments


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000The maturity of non-current bank loans are as follows:- After one year and before two years 1,297,735 1,023,831 449,696 101,666- After two years and before five years 1,326,440 2,068,500 175,000 -- After five years 1,071,582 557,629 - -

3,695,757 3,649,960 624,696 101,666


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Not later than one year 28,685 30,113 8,017 8,542Later than one year and not later than two years 22,025 21,661 5,899 6,596Later than two years and not later than five years 26,072 23,302 6,114 5,939

76,782 75,076 20,030 21,077Future finance charges on finance leases (7,834) (7,536) (1,944) (2,131)Present value of finance lease liabilities 68,948 67,540 18,086 18,946

The maturity of finance lease liabilities are as follows:Not later than one year 24,809 26,062 7,002 7,366Later than one year and not later than two years 19,773 19,542 5,353 5,949Later than two year and not later than five years 24,366 21,936 5,731 5,631

68,948 67,540 18,086 18,946


(d) Bonds

These relate to multi-currency medium term loan notes which are secured by floating charges on the assets of the Company and bear both fixed and floating coupon rates. As at December 31, 2018, the coupon rates on the bonds vary between the range of 4.30% - 7.15% (2017: 4.30% - 7.15%). The notes are repayable over a 1, 3 and 5 year period.

(e) Private placement


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000- Within one year 210,000 - 210,000 -- After one year and before two years - 210,000 - 210,000- After two years and before five years 1,590,000 1,150,000 1,590,000 1,150,000- After five years - 440,000 - 440,000

1,800,000 1,800,000 1,800,000 1,800,000

THE GROUP & THE COMPANY THE GROUP & THE COMPANY2018

Rs’0002017

Rs’000- After two years and before five years 300,000 300,000- After five years 2,200,000 2,200,000

2,500,000 2,500,000





Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Amounts recognised in the statements of financial position as non-current liabilities:- Pension benefits (note 32(a)(ii)) 442,842 433,046 254,613 243,712

Amount charged to profit or loss:- Pension benefits (note 32(a)(vi)) 46,042 37,408 25,827 19,777

Amount (credited)/charged to other comprehensive income:- Pension benefits (note 32(a)(vii)) (21,545) 21,566 (9,918) 11,876

32. RETIREMENT BENEFIT OBLIGATIONS

(a) Pension benefits

(i) The Group operates a final salary defined benefit pension or retirement plan for some employees and any plan assets are held separately from the Group. The assets of the plan are invested in unitised funds held within the SIPF. Other post retirement benefits relate mainly to gratuities on death and on retirement that are based on length of service and salaries at date of death and retirement.

The most recent actuarial valuations of plan assets and the present value of the defined benefit obligations were carried out at December 31, 2018 by AON Hewitt Ltd (Actuarial Valuer). The present value of the defined benefit obligations, and the related current service cost and past service cost, were measured using the Projected Unit Credit Method.

(ii) Amounts recognised in the statements of financial position:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Present value of funded obligations 673,673 682,858 364,969 368,488Fair value of plan assets (404,914) (410,344) (211,142) (216,939)

268,759 272,514 153,827 151,549Present value of unfunded obligations 174,083 160,532 100,786 92,163Liability in the statements of financial position 442,842 433,046 254,613 243,712

(iii) Movements in the statements of financial position are:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 433,046 387,930 243,712 217,385Charged to profit or loss 46,042 37,408 25,827 19,777Charged to other comprehensive income (21,545) 21,566 (9,918) 11,876Contributions paid (14,701) (13,858) (5,008) (5,326)At December 31, 442,842 433,046 254,613 243,712

In 2017, the Company issued private placements amounting to Rs.2.5 billion. These are secured by floating charges on the assets of the Company and bear a fixed coupon rate. As at December 31, 2018, the coupon rate on the private placement vary between the range of 5.90% - 6.40%. The notes are repayable over a 4 and 6 year’s period.

(f) Loan from related partyThe loan from related party bears interest of 4.35% - 7.75% (2017: 4.35% - 5.10%).

(g) All rupee denominated bank overdrafts and bank borrowings bear interest rates which can fluctuate anytime when the banks modify their Prime Lending Rates based on the Bank of Mauritius’ Repo rate. Euro denominated bank borrowings bear fixed and floating interest rates.

(h) The carrying amount of the Group’s and the Company’s borrowings are denominated in the following currencies:THE GROUP THE COMPANY

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Mauritian Rupee 8,810,629 8,567,922 6,016,090 6,125,810Euro 1,228,695 1,384,078 - 1,112GBP 371,695 138,930 264,840 138,930US Dollar 594,775 701,044 217,276 -

11,005,794 10,791,974 6,498,206 6,265,852

(i) The carrying amount of borrowings are not materially different from the fair value.

(j) The effective interest rates at the date of the statement of financial position were as follows:

2018 2017

THE GROUP Rs.%

Euro & USD%

Rs.%

Euro & USD%

Bank loans 5.30-8.50 0.69-8.00 5.75-8.50 0.69-6.34Bank overdrafts 4.25-7.75 N/A 4.25-7.75 N/AShort-term loan 6.00-6.75 N/A 6.00-6.75 2.75-5.48Loan from related party 4.35-7.75 N/A 4.35-5.10 N/AFinance lease liabilities 5.50-8.50 N/A 5.85-8.50 N/APrivate Placement 5.90-6.40 N/A 5.90-6.40 N/ABonds 4.30-7.15 N/A 4.30-7.15 N/A

2018 2017

THE COMPANY Rs.%

Euro & USD%

Rs.%

Euro & USD%

Bank loans 5.60-7.00 3.8-6.43 5.75-7.65 3.00Bank overdrafts 4.25-6.25 N/A 4.25-7.25 N/AShort-term loan 6.00-6.75 N/A 6.00-6.75 2.75-5.48Loan from related party 4.35-7.75 N/A 4.35-5.10 N/AFinance lease liabilities 6.85-8.25 N/A 6.85-8.25 N/APrivate Placement 5.90-6.40 N/A 5.90-6.40 N/ABonds 4.30-7.15 N/A 4.30-7.15 N/A

(k) Borrowings of Rs. 56,000,000 have been pledged against shares in financial assets.

31. BORROWINGS (cont’d)

(e) Private placement (cont’d)





32. RETIREMENT BENEFIT OBLIGATIONS (cont’d)

(a) Pension benefits (cont’d)

(iv) Movements in the defined benefit obligations:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 843,390 783,143 460,651 428,853Current service cost 14,463 13,250 6,383 6,075Employee contributions 1,701 1,902 801 911Interest cost 45,092 49,519 24,669 27,148Past service cost 8,419 (502) 6,165 (221)Benefits paid (47,428) (41,720) (25,789) (22,514)Liability experience gains (15,240) (4,648) (11,341) (1,988)Other benefits paid (205) - - -Liability losses due to change in financial assumptions (2,436) 42,446 4,216 22,387At December 31, 847,756 843,390 465,755 460,651

(v) Movements in the fair value of plan assets of the year:

(vi) Amounts recognised in profit or loss:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000At January 1, 410,344 395,213 216,939 211,468Interest income 21,727 24,859 11,390 13,225Return on plan assets excluding interest income 3,869 16,232 2,793 8,523Employer contributions 12,029 13,858 5,008 5,326Employee contributions 1,701 1,902 801 911Benefits paid (44,756) (41,720) (25,789) (22,514)At December 31, 404,914 410,344 211,142 216,939


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Current service cost 14,463 13,250 6,383 6,075Past service cost 8,419 (502) 6,165 (221)Interest expense 143 185 - -Employer contribution (205) - - -Net interest on net defined benefit liability 23,222 24,475 13,279 13,923Total included in employee benefit expense 46,042 37,408 25,827 19,777




(vii) The amounts recognised in other comprehensive income are:


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Liability experience gains (15,240) (4,648) (11,341) (1,988)Actuarial (gains)/losses arising from changes in financial assumptions (2,436) 42,446 4,216 22,387

(17,676) 37,798 (7,125) 20,399Return on plan assets excluding interest income (3,869) (16,232) (2,793) (8,523)

(21,545) 21,566 (9,918) 11,876

(viii) The assets in the plan were:

(ix) The assets of the plan are invested in equities, fixed interest bonds and bank deposits. The expected return on plan assets was determined by considering the expected returns available on the assets underlying the current investment policy. Expected yields on fixed interest investments are based on gross redemption yields at the end of the reporting period. Expected returns on equity and property investments reflect long-term real rates of return experienced in the respective markets.

(x) The funding policy is to pay contributions to an external legal entity at the rate recommended by the Group’s actuary. Expected contributions to post-employment benefit plans for the year ending December 31, 2019 are Rs’000 50,876 for the Group and Rs’000 26,396 for the Company.

(xi) The weighted average duration of the defined benefit obligations for the Group/Company at the end of the reporting period is 7 years.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Overseas equities 101,229 82,069 52,786 43,388Local equities 117,425 119,000 61,231 62,912Fixed interest - Overseas 21,114 17,481 21,114 15,186Fixed interest - Local 27,448 49,896 27,448 49,896Debt 44,568 51,859 - -Property 76,934 90,039 40,117 45,557Cash and others 16,197 - 8,446 -Total market value of assets 404,914 410,344 211,142 216,939




(xii) The principal actuarial assumptions used for accounting purposes were:

(xiii) The defined benefit pension plan exposes the Group to actuarial risks, such as investment, interest, longevity and salary risks.

Investment riskThe plan liability is calculated using a discount rate determined by reference to government bond yields; if the return on plan assets is below this rate, it will create a plan deficit and if it is higher, it will create a plan surplus.

Interest riskA decrease in the bond interest rate will increase the plan liability; however, this may be partially offset by an increase in the return on the plan’s debt investments and a decrease in inflationary pressures on salary and pension increases.

Longevity riskThe plan liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plan liability.

Salary riskThe plan liability is calculated by reference to the future projected salaries of plan participants. As such, an increase in the salary of the plan participants above the assumed rate will increase the plan liability whereas an increase below the assumed rate will decrease the liability.

(xiv) Sensitivity analysis on defined benefit obligations at end of the reporting date:


%2017

%2018

%2017

%Discount rate 5.89 5.50 5.60 5.50Future salary increases 3.75 4.00 3.50 4.00Future pension increases 1.00 1.00 1.00 1.00Average retirement age (ARA) 57 60 60 60


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

- Increase due to 1% decrease in discount rate 83,499 60,929 40,577 32,911- Decrease due to 1% increase in discount rate 68,145 50,286 33,722 28,071

33. PAYABLE TO RELATED PARTIES

34. TRADE AND OTHER PAYABLES

35. BLUE PRINT COSTS


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Holding company 4,423 547 4,423 547Subsidiary companies - - 496,922 3,727Subsidiaries of holding company 125,353 129,600 42,686 53,654Companies with common directors 2,621 3,059 - -

132,397 133,206 544,031 57,928

The carrying amounts of payable to related parties approximate their fair values.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Trade payables 614,761 530,509 71,749 41,446Other payables and accrued expenses 558,460 498,496 126,281 148,805Deposit on sale of land 345,571 - 318,571 -

1,518,792 1,029,005 516,601 190,251

The carrying amounts of trade and other payables approximate their fair values.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Provision for infrastructure and social costs 54,401 54,426 - -

Blue print costs relate to future expenditure in respect to land and infrastructure costs for employees who opted for the Blue Print and Early Retirement Scheme for Omnicane Milling Operations Limited.




An increase/decrease of 1% in other principal actuarial assumptions would not have a material impact on defined benefit obligations at the end of the reporting period.




36. DIVIDENDS PAYABLE

37. NOTES TO THE STATEMENTS OF CASH FLOWS

(a) Cash generated from/(absorbed by) operations before working capital changes


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

January 1, 134,025 134,025 134,025 134,025

Dividend paid during the year (117,225) (134,025) (117,225) (134,025)Final proposed dividend of Rs.nil per share (2017: Rs.2.00) - (134,025) - (134,025)December 31, 16,800 134,025 16,800 134,025


Notes2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Loss before taxation (325,768) (232,373) (18,274) (104,530)Adjustments for: -Depreciation of property, plant and equipment 15 611,972 599,358 48,629 47,680Amortisation of intangible assets 16 32,022 32,613 10,152 11,525Impairment of investment in subsidiary 17 - 1,760 39,054 1,760Movement in provision for retirement benefit obligations 31,341 23,550 20,819 14,451Dividend income 9 (4,787) (4,760) (134,450) (176,826)Interest income 9 (151,362) (116,816) (398,450) (335,291)Interest expense 10 635,555 643,354 375,623 360,129Share of results of associates 18 1,953 155,950 - -Land conversion rights acquired - (201,665) - (89,281)Gain on retranslation of non-current receivables - (95,623) - -Cash flow hedge and translation reserve movement 33,133 (12,480) - -Land debtors written off - 14,367 - 14,367Reversal of profit on sale on land - 71,218 - 71,218Profit on sale of property (3,075) (52,356) - -Profit on sale of land (128,359) (62,775) (128,359) (62,775)Profit (loss) on sale of investment in financial assets 1,986 - 1,986 -Profit on sale of management contract - (56,717) - (36,200)Profit on sale of plant and equipment - (2,154) (2,013) (1,163)Loss in fair value of consumable biological assets 2,164 61,602 1,692 48,796Cash generated from/(absorbed by) operations before working capital changes 736,775 766,053 (183,591) (236,140)

37. NOTES TO THE STATEMENTS OF CASH FLOWS (cont’d)

(b) Working capital requirements comprise

(c) Dividends paid

(d) Reconciliation of liabilities arising from financing activities


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Inventories 58,776 (38,309) 1,148 (632)Trade and other receivables 2,299,138 276,955 586,333 60,217Receivable from related parties 993,324 (337,784) 4,967,231 (650,165)Trade and other payables 47,672 (64,580) (123,437) 48,042Payable to related parties (809) (44,666) 486,103 (7,938)Financial assets at amortised cost (1,426,030) - (2,705,349) -Other financial assets at amortised cost (1,980,174) - (3,491,699) -Total working capital requirements (8,103) (208,384) (279,670) (550,476)


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Dividends are reconciled to the amounts disclosed in the statement of comprehensive income as follows:Amounts due at beginning of the year (134,025) (134,025) (134,025) (134,025)Dividends declared - (134,025) - (134,025)Amounts due at the end of the year 16,800 134,025 16,800 134,025Dividends paid (117,225) (134,025) (117,225) (134,025)

THE GROUP At January 1, 2018 Rs’000

Cash outflowsRs’000

AcquisitionRs’000

Foreign exchange movement

Rs’000

At December 31, 2018

Rs’000Bank loans 4,979,974 (1,056,024) 1,224,215 (22,443) 5,125,722

THE COMPANY At January 1, 2018 Rs’000

Cash outflowsRs’000

AcquisitionRs’000

Foreign exchange movement

Rs’000

At December 31, 2018

Rs’000Bank loans 750,008 (449,253) 744,015 (148) 1,044,622





38. CAPITAL COMMITMENTS

Capital expenditure contracted for at the end of the reporting period but not yet incurred is as follows:

(e) Cash and cash equivalents

Cash and cash equivalents consist of cash in hand and balances with banks and bank overdrafts. Cash and cash equivalents are represented by:

(f) Deposits in escrow accounts

Deposits of Rs.’000 21,180 are held in escrow accounts and relate to security deposits as consideration for reservation of residential units under the smart city project to be sold under VEFA.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Cash in hand and at bank 195,126 387,644 12,326 54,788Cash at Notary 23,000 - - -

218,126 387,644 12,326 54,788Bank overdrafts (note 31(b)) (1,421,850) (1,430,460) (1,135,499) (1,196,898)

(1,203,724) (1,042,816) (1,123,173) (1,142,110)

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was immaterial.


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Capital expenditure approved by the Board:- not contracted 87,155 38,044 - 8,088- contracted 71,412 163,867 33,525 110,615

158,567 201,911 33,525 118,703


Rs’0002017

Rs’0002018

Rs’0002017

Rs’000

Bank and other guaranteesBank guarantee 83,644 507,421 3,500 226,154Government guarantee 42,386 35,325 386 -Performance bond 280 416 - -Money guarantee 240,000 - - -

366,310 543,162 3,886 226,154

39. CONTINGENT LIABILITIES

39. CONTINGENT LIABILITIES (cont’d)

At December 31, 2018, the Group had contingent liabilities in respect of bank and other guarantees and other matters arising in the ordinary course of business from which it is anticipated that no material liabilities would arise.

Refad Rwanda Ltd has placed USD 750,000 performance bond with the Rwanda Energy Group Limited for the supply of 2 MW of power by January 2019 and supply of 3 MW of power by December 2019.

40. HOLDING COMPANYThe holding company is Omnicane Holdings Limited, a Company incorporated in Mauritius.


37. NOTES TO THE STATEMENTS OF CASH FLOWS (cont’d)



41. RELATED PARTY TRANSACTIONS

(a) THE GROUP

(Purchase)/sale of supplies and services Interest (expense)/ income Amount due to Amount due from

THE GROUP 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Holding company - - (4,188) (790) 4,423 547 - -Associated companies - - 140,783 105,476 - - 1,204,194 720,568Subsidiaries of holding company (186,184) (176,539) 1,417 8,074 125,353 129,600 1,637 140,808Companies with common directors (11,140) (16,217) - - 1,400 3,059 4,493 6,716Other related parties - - 65 745 1,221 - 74,398 125,232

(197,324) (192,756) 138,077 113,505 132,397 133,206 1,284,722 993,324

(b) THE COMPANY

(Purchase)/sale of supplies and services

Interest (expense)/ income

Dividend (payable)/ income Amount owed to Amount due from

THE COMPANY 2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

2018Rs’000

2017Rs’000

Holding company - - (4,188) (790) (16,800) (94,150) 4,423 547 - -Subsidiary companies (55,399) (49,532) 350,036 323,602 134,450 176,800 516,678 3,727 3,680,019 4,040,297Associated companies 1,000 1,000 30,480 9,204 - - - - 649,521 340,798Subsidiaries of holding company (36,166) 263,283 (9,664) (3,331) - - 42,506 53,654 - 122,563Other related companies - - (95) 934 - - - - - 77,169Companies with common directors - - - - - - - 2,776 1,354

(90,565) 214,751 366,569 329,619 117,650 82,650 563,607 57,928 4,332,316 4,582,181

The above transactions have been made on normal commercial terms and in the normal course of business.

The sales to and purchases from the related parties are made at normal market prices. Outstanding balances at the year end are unsecured, interest free and settlement occurs in cash.

There has been no guarantees provided or received for any related party receivables or payables.



Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Short-term benefits 60,760 68,458 7,996 23,677Post-employment benefits 300 4,096 426 524

61,060 72,554 8,422 24,201

Sugar and Ethanol Energy Hospitality Property Total2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Primary reporting format

- business segments

Segment revenue 1,440,206 1,634,064 2,595,728 2,700,385 165,908 161,412 43,329 43,329 4,245,171 4,539,150

Segment operating (loss)/profit (365,777) (318,229) 414,757 509,805 5,788 920 (30,824) (23,310) 23,944 169,185Share of loss from associates (1,953) (155,950)

Investment income 156,149 121,576Other non operating income/(expenses) 128,360 (22,810)

Exceptional items - 212,597

Finance costs (632,268) (556,971)

Loss before taxation (325,768) (232,373)

Taxation (76,562) (94,193)

Loss for the year (402,330) (326,566)

Non-controlling interests 11,386 96,236Loss attributable to owners of the parent (413,716) (422,802)

42. SEGMENT INFORMATION

The Group is organised into the following main business segments:

43. SEGMENT INFORMATION (cont’d)

The accounting policies of the operating segments are the same as those described in the summary of significant accounting policies.

Sugar and Ethanol Energy Hospitality Property Total2018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’0002018

Rs’0002017

Rs’000Segment assets 13,650,262 13,713,481 6,217,929 5,972,885 737,748 761,802 3,771,590 3,509,801 24,377,529 23,957,969

Associates 79,844 964,672

24,457,373 24,922,641

Segment liabilities 8,287,739 8,263,130 4,320,444 4,032,802 521,548 539,026 421,068 88,796 13,550,799 12,923,754

Owners’ interests 9,930,284 10,964,991

Non-controlling interests 976,290 1,033,896

24,457,373 24,922,641

Investment income 147,570 112,382 8,579 9,194 - - - - 156,149 121,576

Interest expense 464,467 419,474 151,245 198,421 19,843 25,459 - - 635,555 643,354Capital expenditure - Property, plant and equipment

270,087 257,548 314,407 139,455 7,251 1,635 76,752 26,771 668,497 425,409

Depreciation - Property, plant and equipment 261,793 256,029 320,585 314,292 29,451 29,037 143 - 611,972 599,358




(i) KEY MANAGEMENT PERSONNEL COMPENSATION

41. RELATED PARTY TRANSACTIONS (cont’d)

(b) THE COMPANY (cont’d)


44. THREE YEARS FINANCIAL SUMMARY


Restated2017

Rs’000

Restated 2016

Rs’000Turnover 4,245,171 4,539,150 4,502,280Share of (loss)/profit of associates (1,953) (155,950) 4,732(Loss)/profit before taxation (325,768) (232,373) 234,392Income tax charge (76,562) (94,193) (26,699)(Loss)/profit for the year (402,330) (326,566) 207,693Other comprehensive income for the year (33,235) 2,783,894 (76,199)Total comprehensive income for the year (435,565) 2,457,328 131,494

(Loss)/profit attributable to:- Owners of the parent (413,716) (422,802) 132,004- Non-controlling interests 11,386 96,236 75,689

(402,330) (326,566) 207,693Total comprehensive income attributable to:- Owners of the parent (458,057) 2,347,796 59,801- Non-controlling interests 22,492 109,532 71,693

(435,565) 2,457,328 131,494(Loss)/earnings per share (Rs.) (6.17) (6.28) 1.97


Restated2017

Rs’000

Restated 2016

Rs’000ASSETSNon-current assets 20,834,573 21,039,936 18,436,089Current assets 3,622,800 3,882,705 4,698,985Total assets 24,457,373 24,922,641 23,135,074

EQUITY AND LIABILITIESOwners’ interests 9,930,284 10,964,991 8,751,220Non-controlling interests 976,290 1,033,896 1,040,364Total equity 10,906,574 11,998,887 9,791,584

LIABILITIESNon-current liabilities 8,646,980 8,781,209 7,073,320Current liabilities 4,903,819 4,142,545 6,270,170Total liabilities 13,550,799 12,923,754 13,343,490

Total equity and liabilities 24,457,373 24,922,641 23,135,074

Net assets per share (Rs.) 148.19 163.62 130.59

45. CHANGES IN ACCOUNTING POLICIES

(a) Impact on the financial statements

For the year ended December 31, 2018, following changes in deferred tax rate, the financial statements have been restated retrospectively in accordance with IAS 8. Consequently the Group/Company has adjusted opening equity and deferred taxation liability as of January 1, 2017 and figures for 2016 have been restated as if the new accounting policy has always been applied.

IFRS 9 and IFRS 15 were adopted without restating comparative information. Any adjustments arising from the new accounting policies are not reflected in the comparatives year ended December 31, 2017 but are recognised in the opening reserves on January 1, 2018.

The following tables show the adjustments recognised for each individual line item.

Statement of financial position (Extract)

(a) Results

(b) Statement of financial position

THE GROUPNotes

As previously reportedRs’000

Cumulative adjustment

Rs’000Restated balance

Rs’000January 1, 2018Non-current assetsProperty, plant and equipment 45(c) 16,651,091 8,897 16,659,988Financial assets at amortised cost - Loss allowance 45(b) - (345,210) (345,210) - Deferred project written off 319,457 (42,926) 276,531Deferred tax assets 45(f) 84,263 9,376 93,639

Current assetsOther financial assets at amortised cost - Loss allowance 45(d) - (45,072) (45,072) - Land under development 45(c) 226,048 291,964 518,012Non-current assets held for sale 45(c) 45,842 31,955 77,797

EquityRevaluation and other reserves 8,561,991 (38) 8,561,953Retained earnings 1,622,774 (603,605) 1,019,169

Non-controlling interests 1,050,023 (10,193) 1,039,830

Non-current liabilitiesDeferred tax liabilities 45(f) 302,406 40,319 342,725

Current liabilitiesTrade and other payables 45(c) 1,029,005 482,501 1,511,506





45. CHANGES IN ACCOUNTING POLICIES (cont’d)

(a) Impact on the financial statements (cont’d)

Statement of financial position (Extract) (cont’d)

THE GROUPNotes




Rs’000January 1, 2017Non-current assetsDeferred tax assets 45(f) 114,971 5,746 120,717EquityRevaluation and other reserves 6,192,395 (45) 6,192,350Retained earnings 1,779,394 (15,567) 1,763,827Non-controlling interests 1,054,600 (14,236) 1,040,364Non-current liabilitiesDeferred tax liabilities 45(f) 266,931 35,594 302,525

THE COMPANYNotes




Rs’000January 1, 2018Non-current assetsProperty, plant and equipment 45(c) 5,289,848 519 5,290,367Financial assets at amortised cost - - Loss allowance 45(d) - (465,987) (465,987) - Deferred project written off 319,457 (16,099) 303,358Invesment in associate 11,463 (6,176) 5,287Deferred tax assets 45(f) 23,081 3,078 26,159Current assetsOther financial assets at amortised cost - Loss allowance 45(d) - (24,073) (24,073) - Land under development 45(c) 226,048 291,964 518,012Non-current assets held for sale 45(c) 32,949 31,955 64,904EquityRevaluation and other reserves 5,119,709 - 5,119,709Retained earnings 4,454,100 (653,192) 3,800,908Current liabilitiesTrade and other payables 45(c) 190,251 451,205 641,456January 1, 2017Non-current assetsDeferred tax assets 45(f) 17,355 2,314 19,669EquityRevaluation and other reserves 5,499,947 - 5,499,947Retained earnings 3,459,269 2,314 3,461,583


(a) Impact on the financial statements (cont’d)

The impact on the retained earnings is as follows:

(b) IFRS 9 Financial Instruments

(i) Classification and measurementEquity investments previously classified as available-for-saleThe Group elected to present in OCI changes in the fair value of all its equity investments previously classified as available-for-sale, because these investments are held as long-term strategic investments that are not expected to be sold in the short to medium term.

Available-for-sale debt instruments classified as FVOCIListed and unlisted bonds were reclassified from available for sale to FVOCI, as the Group’s business model is achieved both by collecting contractual cash flows and selling of these assets. The contractual cash flows of these investments are solely principal and interest.

Reclassification from investment in associate to FVOCIThe Group elected to present in OCI investments previously classified investment in associate following dilution of its interest in the associate, loss of significant influence and because the investment is held as long-term strategic investment that are not expected to be sold in the short to medium term.

Reclassifications of financial instruments on adoption of IFRS 9On the date of initial application, January 1, 2018, the financial instruments of the Group were as follows, with any reclassifications noted:

THE GROUPRs’000

THE COMPANYRs’000

Retained earnings December 31, 2017 1,622,774 4,454,100Adjustments from adoption of IFRS 9 (396,215) (490,060)Adjustment from adoption of IFRS 15 (149,685) (126,767)Change in deferred tax (14,779) 3,078Impairment of associate - (6,176)Deferred project written off (42,926) (33,267)Restated retained earnings January 1, 2018 1,019,169 3,800,908






(b) IFRS 9 Financial Instruments (cont’d)

(i) Classification and measurement (cont’d)

Measurement category Carrying amount

THE GROUP Original(IAS 39/28)

New(IFRS 9)

OriginalRs’000

NewRs’000

DifferenceRs’000

Non-current financial assetsEquity securities Available-for-sale FVOCI 174,774 174,774 -Investmnet in associate Equity accounting FVOCI 882,875 882,875 -Listed and unlisted debt securities Available-for-sale FVOCI 124,292 124,292 -

Receivable from related parties Amortised cost Amortised cost 1,177,955 832,745 345,210Other receivables Amortised cost Amortised cost 319,457 319,457 -

Current financial assetsTrade receivables Amortised cost Amortised cost 746,230 746,230 -Other receivables Amortised cost Amortised cost 577,111 532,039 45,072Receivable from related parties Amortised cost Amortised cost 993,324 993,324 -

Measurement category Carrying amount

THE COMPANY Original(IAS 39)

New(IFRS 9)

OriginalRs’000

NewRs’000

DifferenceRs’000

Non-current financial assetsEquity securities Available-for-sale FVOCI 4,481 4,481 -Receivable from related parties Amortised cost Amortised cost 1,285,050 819,063 465,987Other receivables Amortised cost Amortised cost 319,457 319,457 -

Current financial assetsTrade receivables Amortised cost Amortised cost 60,973 60,973 -Other receivables Amortised cost Amortised cost 270,545 246,472 24,073Receivable from related parties Amortised cost Amortised cost 4,582,181 4,582,181 -


(b) IFRS 9 Financial Instruments (cont’d)

(ii) Impairment of financial assets (cont’d)

Trade receivablesThe Group applies IFRS 9 simplified approach to measuring expected credit losses which uses a lifetime expected loss allowance for all trade receivables and contract assets. This resulted in an increase of the loss allowance on January 1, 2018 by Rs.390,282 for the Group and Rs.490,060 for the Company.

The loss allowance of the Company increased by a further Rs’000 64 to Rs’000 490,124 during the current reporting period and the loss allowance of the Group remained unchanged.

(c) IFRS 15 Revenue from Contracts with customers

The following adjustments were made to the amounts recognised in the balance sheet at January 1, 2018.


THE GROUP

IAS 18 carrying amount

December 31, 2017

Rs’000Reclassification

Rs’000Remeasurements

Rs’000

IFRS 15 carrying amount

January 1, 2018Rs’000

Trade receivables 1,642,798 (896,568) - 746,230Other non-current financial assets at amortised cost - 319,457 - 319,457Other current financial assets at amortised cost - 577,111 291,964 869,075Other non-current assets - Property, plant and equipment 16,651,091 - 8,897 16,659,988 - Non-current asset held-for-sale 45,842 - 31,955 77,797Trade and other payables 1,029,005 - 482,501 1,511,506

THE COMPANY

IAS 18 carrying amount

December 31, 2017

Rs’000Reclassification

Rs’000Remeasurements

Rs’000

IFRS 15 carrying amount

January 1, 2018Rs’000

Trade receivables 625,828 (564,855) - 60,973Other non- current financial assets at amortised cost - 294,310 - 294,310Other current financial assets at amortised cost - 270,545 291,964 562,509Other non-current assets - Property, plant and equipment 5,289,848 - 519 5,290,367 - Non-current asset held-for-sale 32,949 - 31,955 64,904Trade and other payables 190,251 - 451,205 641,456

(ii) Impairment of financial assets

Trade and other receivable arising from sale of sugar, electricity, ethanol, and provision of logistics and accomodation revenue are subject to IFRS 9’s new expected credit loss model:

The Group was required to revise its impairment methodology under IFRS 9 for each of these classes of assets. The impact of the change in impairment methodology on the Group’s retained earnings and equity is disclosed above.

While cash and cash equivalents are also subject to the impairment requirements of IFRS 9, the identified impairment loss was immaterial.





(d) Deferred tax (cont’d)

The effect of change in effective tax rate is as follows:

The effect on the Statement of Profit or Loss and Other Comprehensive Income is as follows:

THE GROUP Net deferred tax liability

Rs’000

Revaluation and other reserves

Rs’000

Retained earnings

Rs’000

Owners’ Interest Rs’000

Non- controlling

Interest Rs’000

Total Rs’000

Balance as reported at January 1, 2017- As previously stated 151,960 6,192,395 1,779,394 8,766,832 1,054,600 9,821,432- Effect of change in the effective tax rate 29,848 (45) (15,567) (15,612) (14,236) (29,848)- As restated 181,808 6,192,350 1,763,827 8,751,220 1,040,364 9,791,584

Balance as reported at January 1, 2018- As previously stated 218,143 8,561,991 1,622,774 10,979,808 1,050,023 12,029,831- Effect of change in the effective tax rate on figures as at January 1, 2017 29,848 (45) (15,567) (15,612) (14,236) (29,848)

- Effect of change in the effective tax rate on figures as at January 1, 2018 1,096 7 788 795 (1,891) (1,096)

- As restated 249,087 8,561,953 1,607,995 10,964,991 1,033,896 11,998,887

THE COMPANYDeferred tax

assetRs’000

Actuarial lossesRs’000

Retained earningsRs’000

Total equityRs’000

Balance as reported at January 1, 2017- As previously stated (17,355) (118,062) 3,459,269 9,754,259- Effect of change in the effective tax rate (2,314) - 2,314 2,314- As restated (19,669) (118,062) 3,461,583 9,756,573

Balance as reported at December 31, 2017- As previously stated (23,081) (128,157) 4,454,100 10,368,852- Effect of change in the effective tax rate on 2016 figures (2,314) - 2,314 2,314- Effect of change in the effective tax rate on 2017 figures (764) - 764 764- As restated (26,159) (128,157) 4,457,178 10,371,930

THE GROUP THE COMPANY Owner’s Interest

2017 Rs’000

Non-controlling interest

2017Rs’000

2017Rs’000

Increase/(decrease) in tax charge and decrease in profit for the year 788 (1,894) 764

Decrease in deferred tax on remeasurements of post employment benefit obligations and increase in other comprehensive income for the year 7 3 -

Increase/(decrease) in total comprehensive income for the year 795 (1,891) 764

THE GROUPAs reported under

IFRS 15Rs’000

EffectRs’000

As would have been reported

Rs’000Revenue 4,245,171 (43,329) 4,201,842Other operating expense (4,263,474) 20,411 (4,243,063)Other operating income 44,411 - 44,411Other non-operating income 128,360 (104,808) 23,552Loss for the year (402,330) (127,726) (530,056)

Total Equity 10,906,574 (127,726) 10,778,848

THE COMPANYAs reported under

IFRS 15Rs’000

EffectRs’000

As would have been reported

Rs’000Revenue 217,348 - 217,348Other operating income 3,013 - 3,013Other non-operating income 128,360 (104,808) 23,552Loss for the year (24,702) (104,808) (129,510)

Total Equity 9,699,193 (104,808) 9,594,385


(c) IFRS 15 Revenue from Contracts with customers (cont’d)

Had the Group continued to report in accordance with IAS 18 Revenue for the year ended December 31, 2018, it would have reported the following amounts in these financial statements:




(d) Deferred tax

Change in effective tax rateFollowing a review of the effective tax rate in line with the definition within the Income Tax Act 1995, the 2% Corporate Social Responsibility (CSR) is regarded as a tax and is therefore subsumed within the Statement of Comprehensive Income.

Since the Company has tax losses carried forward, it is not liable to neither income tax nor to CSR. The impact of the change in effective tax rate is only on deferred tax liabilities.

The main reasons for the differences is ‘The identification of additional performance obligations in certain consultancy contracts and the recognition of the revenue on some of those performance obligations at a point in time rather than over time under IAS 18.’


Annex 1 Compliance Assessment – Code of Corporate Governance 2016

09 / Annexes

Key: *** Compliant, ** Partially compliant, *Under review, x Not applicable

Rating Reasons for partial/non-compliance

Action to be taken

Principle 1 – Governance structure

Affirmation that the Organisation is a public entity as defined by law.

***

Statement that the Board assumes responsibility for leading and controlling the organisation and meeting all legal and regulatory requirements.

***

Statement that the Board has approved its charter, the organisation’s Code of Ethics, appropriate job descriptions of the key senior positions, an organisational chart and a statement of accountabilities.

***

Principle 2 - The structure of the Board and its Committees

Statement that the Board is unitary (one tier). ***

Identification by name and status of every Director (independent or non-independent, external or internal) and the company secretary, information probably best presented in tabular form.

***

An explanation should be provided if a Board has less than two independent Directors.

***

Criteria the Board employed to determine its sufficient size and composition.

***

Identification of the Directors who ordinarily reside in Mauritius. ***

Identification of the gender balance on the Board. ***

Disclosure of the attendance record of Directors at Board meetings, information probably best presented in tabular form.

***

For every Director, the details of each chair and external and internal directorship that he or she holds in other organisations. The details should include the name of company and type of directorship held.

***

Definition of the roles and responsibilities of each Board Committee, including the following information: the number of members, the number of independent members, the name of the Committee chairperson, and the names of the other members; the attendance record of all members at Committee meetings; the scope of each Committee’s responsibility and how frequently the Board reassesses the charter of each Committee.

***



Action to be taken

Principle 3 – Director appointment

Statement that the Board assumes the responsibilities for succession planning and for the appointment and induction of new Directors to the Board.

***

Affirmation that all new Directors have attended and participated in an induction and orientation process.

***

Statement that the Board has reviewed the professional development and ongoing education of Directors.

***

Details of the nomination and appointment process. ***

Short biographies of each Director that include experience, skills, expertise and, where applicable, continuing professional development.

***

Short biography of the Company Secretary that includes experience, skills, expertise and, where applicable, continuing professional development.

***

Principle 4 – Director duties, remuneration and performance

Affirmation that the Directors are aware of their legal duties. ***

Affirmation that the Board regularly monitors and evaluates compliance with its Code of Ethics.

***

Statement that the Company Secretary maintains an interests register and that it is available for consultation to shareholders upon written request to the Company Secretary.

***

Affirmation that all conflicts of interest and related-party transactions have been conducted in accordance with the conflicts of interest and related-party transactions policy and Code of Ethics.

***

Affirmation that an information, information technology and information security policy exists.

** No such formal policies in place yet

Description of how the Board oversees information governance.

***

Identification of any restrictions placed over the right of access to information.

***

Discussion of how the organisation monitors and evaluates significant expenditures on Information Technology.

***

Note on when an evaluation of the effectiveness of the Board, its Committees and its individual Directors was conducted.

***


Annex 1Compliance Assessment – Code of Corporate Governance 2016 (cont’d)

09 / Annexes



Action to be taken

Principle 4 – Director duties, remuneration and performance (cont’d)

Identify whether an independent Board evaluator was employed and, if so, how the evaluator was appointed and the name of the person or body responsible for the conduct of the evaluation within the organisation.

***

Outline of the evaluation methods (e.g., meeting discussion, questionnaire, survey, interviews, or observation or a combination of methods).

*** Not done during year under review as it is on a three year basis

Significant actions to be taken as a result of the evaluation.

The remuneration section of the annual report should include the following:

**

Statement of the remuneration policy and the rationale for any changes.

***

Affirmation that the Board or a specified Committee has reviewed the adequacy of Directors’ and senior executives’ remuneration and the form of that remuneration.

***

Appropriate details of Directors’ remuneration to include: an explanation of the proportions of fixed and variable remuneration; details of any long-term incentive plans and a description of any link between executive remuneration and company performance.

***

Assurance that the non-executive Directors have not received remuneration in the form of share options or bonuses associated with organisational performance.

***

The Code of Ethics ***

The conflicts of interest and related party transactions policies. ***

The information, information technology and information security policies.

***

Principle 5 – Risk Governance and Internal Control

Statement that the Board is responsible for the governance of risk and for determining the nature and extent of the principal risks it is willing to take in achieving its strategic objectives.

***

Outline of the structures and processes in place for dentifying and managing risk.

***

Description of the methods by which the Directors derive assurance that the risk management processes are in place and are effective.

***

Description of each of the principal risks and uncertainties faced by the organisation and the way in which each is managed.

***



Action to be taken

Principle 5 – Risk Governance and Internal Control (cont’d)

Identification and discussion of the risks that threaten the business model, future performance, solvency and liquidity of the organisation.

***

Affirmation that the Board or an appropriate Board Committee has monitored and evaluated the company’s strategic, financial, operational and compliance risk.

***

Assurance that by direction of the Board or an appropriate Board Committee, management has developed and implemented appropriate frameworks and effective processes for the sound management of risk.

***

Outline of the systems and processes in place for implementing, maintaining and monitoring the internal controls.

***

Description of the process by which the Board derives assurance that the internal control systems are effective.

***

Identification of any significant areas not covered by the internal controls.

***

Acknowledgement of any risks or deficiencies in the organisation’s system of internal controls.

**

Report on whistle-blowing rules and procedures; possible protections could include confidential hotlines, access to a confidential and independent person or office, safe harbours and rewards, or immunity to whistle-blowers.

***

Principle 6 – Reporting with integrity

An organisational overview normally describes the organisation’s culture, ethics and values; the ownership and operating structure; its principal activities; and key quantitative information (e.g., the number of employees, revenue and number of countries in which the organisation operates). The review should highlight any significant changes from prior periods.

***

An overview of the external environment identifies the organisation’s principal markets; the competitive environment and its position within the market; and significant factors affecting the external environment and the organisation’s response. Significant factors affecting the external environment include aspects of the political, economic, social, technological, legal and environmental issues that influence the organisation’s ability to create value.

***




Action to be taken

Principle 6 – Reporting with integrity (cont’d)

An organisation’s business model is its system of transforming inputs, through its business activities, into outputs and outcomes that aim to fulfil the organisation’s strategic purposes and create value over the short, medium and long terms. The business model can be shown in any format. Visual representation can have more impact than long blocks of text.

***

The narrative report should identify the specific risks and opportunities that affect the organisation’s ability to create value and describe how the organisation is dealing with them.

***

The Board should identify in the annual report the key performance indicators that it employs to evaluate the performance of the organisation. It is recommended that key performance indicators be included that combine financial measures with other components (e.g., the ratio of CO2 emissions or water use to sales).

***

The narrative report should identify the challenges and uncertainties that the organisation is likely to encounter in pursuing its strategy and consider the potential implications for its future performance. It should highlight anticipated changes over time and provide information on the organisation’s expectations about the external environment and how the organisation is currently equipped to respond to likely challenges and uncertainties. The report should reflect positive and negative aspects of the organisation’s performance to enable a reasoned assessment of overall performance.

***

Sustainable development can be defined in many different ways. The United Nations defines sustainable development as a process of change in which the exploitation of resources, the direction of investments, the orientation of technological development, and institutional change are made consistent with future as well as present needs.

***

Environmental issues. ***

Health and Safety issues. ***

Social issues. ***

Corporate Social Responsibility. ***

Charitable and political contributions. ***


09 / Annexes



Action to be taken

Principle 6 – Reporting with integrity (cont’d)

Governance. ***

Affirmation that the Board is responsible for the preparation of accounts that fairly present the state of affairs of the organisation.

***

Statement that the accounts adhere to IFRS, IAS and the Companies Act. If there has been any departure, it must be disclosed, explained and quantified. Any material uncertainties should be identified.

***

Statement that the annual report is published in full on the organisation’s website.

***

An assessment of the organisation’s financial, environmental, social and governance position performance and outlook.

***

Governance report. ***

Principle 7 – Audit

Confirmation of the existence or otherwise of an Internal Audit function.

***

Statement that Internal Audit reports regularly to the audit committee.

***

Description of the areas, systems and processes covered by Internal Audit (including non-financial matters) and an identification of any significant areas not covered (including joint venture, subsidiaries and associates).

***

Description of the functions of the Internal Audit, how it maintains its independence and objectivity.

***

Identification of any restrictions placed over the right of access by Internal Audit to the records, management or employees of the organisation.

***

Statement that the structure, organisation and qualifications of the key members of the Internal Audit function are listed on the organisation’s website.

***

Description of the financial literacy or expertise of the members of the Audit Committee, if applicable.

***




Action to be taken

Principle 7 – Audit (cont’d)

Identification of the significant issues that the Audit Committee considered in relation to the financial statements and how these issues were addressed.

***

Outline of the approach taken to appoint or reappoint the external auditor.

***

Affirmation that the Audit Committee has discussed accounting principles with the external auditor.

***

Disclosure of whether the Audit Committee has met regularly with the external auditor without management being present.

***

Description of the assessment of the effectiveness of the external audit process.

***

Information on the length of tenure of the current audit firm and when a tender was last conducted.

***

Information on non-audit services and the amount paid for each non-audit service.

***

Explanation of how the auditor’s objectivity and independence are safeguarded if the external auditor provides non-auditing services.

***

Principle 8 – Relations with shareholders and other key stakeholders

Identification of those shareholders that hold a significant percentage of total shares in the organisation.

***

Identification of its key stakeholders and explanation of how the organisation has responded to their reasonable expectations and interests.

***

Affirmation that relevant stakeholders have been involved in a dialogue on the organisational position, performance and outlook.

***

Affirmation that the organisation will hold an annual general meeting.

***

Notice of the annual meeting and other shareholder meetings and related papers, to be sent to shareholders at least 14 days before the meeting in accordance with the Companies Act.

***


09 / Annexes

Annex 2 GRI Content Index

09 / Annexes

For the GRI Content Index Service, GRI Services reviewed that the GRI content index is clearly presented and the references for all disclosures included align with the appropriate sections in the body of the report.

GRI Standard Disclosure Page number(s) and/or URL(s) and/or Direct Answers

Omission

Part Omitted Reason Expla-

nation

GRI 101: Foundation 2016

General Disclosures

GRI 102: General Disclosures 2016 Organisational profile

102-1 Name of the organisation Cover page

102-2 Activities, brands, products, and services

Our main activities include: Agriculture Milling – Raw House Milling – Refinery Thermal Energy operations Distillery operations Logistics Property Development Holiday Inn Mon Trésor Our main brands are: Omnicane, Mon Trésor and Kara Our main products are: Refined sugar Electricity Bioethanol Our main services are: Finance, Accounting and Treasury, Internal Audit, Sustainability, Procurement, Project Development and Management, Corporate Secretarial, Human Resources, Marketing

102-3 Location of headquarters Page 12

102-4 Location of operations Page 12

102-5 Ownership and legal form Page 118

102-6 Markets served Page 12

102-7 Scale of the organisation Page 10

102-8 Information on employees and other workers Page 85


09 / Annexes

Annex 2GRI Content Index (cont’d)

GRI Standard DisclosurePage number(s) and/or URL(s) and/or Direct Answers

Omission


nation


General Disclosures


Omission


nation


General Disclosures

GRI 102: General Disclosures 2016 102-9 Supply chain Page 84

102-10 Significant changes to the organisation and its supply chain Page 5

102-11 Precautionary Principle or approach Page 95

102-12 External initiatives Page 91

102-13 Membership of associations Page 23

Strategy

102-14 Statement from senior decision-maker Pages 31-33

102-15 Key impacts, risks, and opportunities Page 95-99

Ethics and integrity

102-16 Values, principles, standards, and norms of behaviour Page 111

Governance

102-18 Governance structure Page 103-106

102-19 Delegating authority Page 104

102-20 Executive-level responsibility for economic, environmental, and social topics Page 103

102-21 Consulting stakeholders on economic, environmental, and social topics Pages 21-23

102-22 Composition of the highest governance body and its committees Page 103-106

102-23 Chair of the highest governance body Page 104

102-24 Nominating and selecting the highest governance body Page 105

102-25 Conflicts of interest Page 111

102-26 Role of highest governance body in setting purpose, values, and strategy Page 104

102-27 Collective knowledge of highest governance body Page 104

102-28 Evaluating the highest governance body’s performance Page 110

102-29 Identifying and managing economic, environmental, and social impacts Page 97-99

102-30 Effectiveness of risk management processes Page 99

102-31 Review of economic, environmental, and social topics Page 99

102-32 Highest governance body’s role in sustainability reporting Page 103

102-33 Communicating critical concerns Page 21

GRI 102: General Disclosures 2016 102-35 Remuneration policies Page 112-113

102-36 Process for determining remuneration Page 112-113

Stakeholder engagement

102-40 List of stakeholder groups Page 21

102-41 Collective bargaining agreements Page 87

102-42 Identifying and selecting stakeholders Page 21

102-43 Approach to stakeholder engagement Page 21

102-44 Key topics and concerns raised Pages 22-23

Reporting practice

102-45 Entities included in the consolidated financial statements

Omnicane Limited Omnicane Management & Consultancy Limited Omnicane Milling Operations Limited

Omnicane Thermal Energy Operations Limited Holiday Inn Mauritius Mon Trésor Omnicane Logistics Operations Limited Omnicane Ethanol Operations Limited

102-46 Defining report content and topic Boundaries Page 5

102-47 List of material topics Page 5

102-48 Restatements of information No restatements of information

102-49 Changes in reporting Page 5

102-50 Reporting period Page 5

102-51 Date of most recent report June 27, 2018

102-52 Reporting cycle Annually

102-53 Contact point for questions regarding the report

Chitra Beekoo-Koonja E: [email protected]

102-54 Claims of reporting in accordance with the GRI Standards Page 5

102-55 GRI content index Page 223

102-56 External assurance Page 5


09 / Annexes


Material Topics

GRI 200 Economic Standard Series

Economic Performance

GRI 103: Management Approach 2016

103-1 Explanation of the material topic and its Boundary Page 64

103-2 The management approach and its components Page 64

103-3 Evaluation of the management approach Page 64

GRI 201: Economic Performance 2016

201-1 Direct economic value generated and distributed Page 65

201-2 Financial implications and other risks and opportunities due to climate change Page 97

201-4 Financial assistance received from government Page 31

Market Presence





GRI 202: Market Presence 2016 202-1 Ratios of standard entry level wage by

gender compared to local minimum wagePage 88

202-2 Proportion of senior management hired from the local community

Page 85

Indirect Economic Impacts





GRI 203: Indirect Economic Impacts 2016

203-1 Infrastructure investments and services supported Page 70

203-2 Significant indirect economic impacts Page 70


Omission


nationGRI Standard Disclosure

Page number(s) and/or URL(s) and/or Direct Answers

Omission


nation

Procurement Practices





GRI 204: Procurement Practices 2016

204-1 Proportion of spending on local suppliers Page 84

Anti-corruption





GRI 205: Anti-corruption 2016

205-2 Communication and training about anti-corruption policies and procedures Page 111

205-3 Confirmed incidents of corruption and actions taken Page 111

Anti-competitive Behaviour





GRI 206: Anti-competitive Behaviour 2016

206-1 Legal actions for anti-competitive behaviour, anti-trust, and monopoly practices Page 111

GRI 300 Environmental Standards Series

Materials





GRI 301: Materials 2016 301-1 Materials used by weight or volume Pages 72-74

301-2 Recycled input materials usedNo recycled input materials used


09 / Annexes


Energy





GRI 302: Energy 2016 302-1 Energy consumption within the organisation Page 75

302-3 Energy intensity Page 75

302-4 Reduction of energy consumption Page 75

Water





GRI 303: Water 2016 303-1 Water withdrawal by source Page 76

303-2 Water sources significantly affected by withdrawal of water Page 76

303-3 Water recycled and reused Page 78

Biodiversity





GRI 304: Biodiversity 2016

304-1 Operational sites owned, leased, managed in, or adjacent to, protected areas and areas of high biodiversity value outside protected areas

Page 77

Emissions





GRI 305: Emissions 2016

305-1 Direct (Scope 1) GHG emissions Page 78

305-7 Nitrogen oxides (NOX), sulfur oxides (SOX), and other significant air emissions Page 77


Omission




Omission


nation

Effluents and Waste





GRI 306: Effluents and Waste 2016

306-1 Water discharge by quality and destination Page 78

306-2 Waste by type and disposal method Pages 78-79

Environmental Compliance





GRI 307: Environmental Compliance 2016

307-1 Non-compliance with environmental laws and regulations Page 79

Supplier Environmental Assessment





GRI 308: Supplier Environmental Assessment 2016

308-1 New suppliers that were screened using environmental criteria Page 84

GRI 400 Social Standards Series

Employment

GRI 103: Management Approach 2016 103-1 Explanation of the material topic and

its BoundaryPage 85



GRI 401: Employment 2016

401-1 New employee hires and employee turnover Page 87

401-2 Benefits provided to full-time employees that are not provided to temporary or part-time employees

Page 89


09 / Annexes



Omission




Omission


nation

Labour/Management Relations





GRI 402: Labour/Management Relations 2016

402-1 Minimum notice periods regarding operational changes Page 87

Occupational Health and Safety





GRI 403: Occupational Health and Safety 2016

403-1 Workers representation in formal joint management-worker health and safety committees

Page 89

403-2 Types of injury and rates of injury, occupational diseases, lost days, and absenteeism, and number of work-related fatalities

Page 88

Training and Education





GRI 404: Training and Education 2016

404-1 Average hours of training per year per employee Page 87

404-2 Programs for upgrading employee skills and transition assistance programs Page 87

Diversity and Equal Opportunity





GRI 405: Diversity and Equal Opportunity 2016

405-1 Diversity of governance bodies and employees Page 104

Non-discrimination





GRI 406: Non-discrimination 2016

406-1 Incidents of discrimination and corrective actions taken Page 88

Freedom of Association and Collective Bargaining





GRI 407: Freedom of Association and Collective Bargaining 2016

407-1 Operations and suppliers in which the right to freedom of association and collective bargaining may be at risk

Page 88

Child Labour





GRI 408: Child Labour 2016

408-1 Operations and suppliers at significant risk for incidents of child labour Page 88

Forced or Compulsory Labour



103-2 The management approach and its components

Page 88


GRI 409: Forced or Compulsory Labour 2016

409-1 Operations and suppliers at significant risk for incidents of forced or compulsory labour

Page 88


09 / Annexes


Security Practices





GRI 410: Security Practices 2016

410-1 Security personnel trained in human rights policies or procedures Page 88

Rights of Indigenous Peoples





GRI 411: Rights of Indigenous Peoples 2016

411-1 Incidents of violations involving rights of indigenous peoples

No indigenous people living in Mauritius

Human Rights Assessment





GRI 412: Human Rights Assessment 2016

412-2 Employee training on human rights policies or procedures Page 88

Local Communities





GRI 413: Local Communities 2016

413-1 Operations with local community engagement, impact assessments, and development programs

Page 81


Omission




Omission


nation

Supplier Social Assessment


103-1 Explanation of the material topic and its Boundary

Page 84



GRI 414: Supplier Social Assessment 2016

414-1 New suppliers that were screened using social criteria Page 84

Public Policy

GRI 103: Management Approach 2016 103-1 Explanation of the

material topic and its Boundary

Mauritius has several industry associations whereby several sectors/companies are invited to give their respective opinions.


Omnicane is member of several national industry associations and take part in public policy decisions from time to time

103-3 Evaluation of the management approach

The company reviews its membership in these associations from time to time.

GRI 415: Public Policy 2016 415-1 Political contributions No political contributions were

made during the year

Customer Health and Safety



Page 22



GRI 416: Customer Health and Safety 2016

416-1 Assessment of the health and safety impacts of product and service categories

Page 22


09 / Annexes

Annex 2GRI Content Index (cont’d) Annex 3

SGS Certificate – External Assurance

09 / Annexes

Marketing and Labeling



Omnicane recognises that delivering safe products is paramount for its clients


As such, we subscribe to several food safety standards and our products certifications e.g ISO 22000 and BRC are communicated to our respective clients.

103-3 Evaluation of the management approach

We have regular audits to review compliance with these standards.

GRI 417: Marketing and Labeling 2016

417-3 Incidents of non-compliance concerning marketing communications

No incidents on non-compliance concerning marketing communications

Customer Privacy



Page 22



GRI 418: Customer Privacy 2016

418-1 Substantiated complaints concerning breaches of customer privacy and losses of customer data

Page 22

Socioeconomic Compliance



Page 111



GRI 419: Socioeconomic Compliance 2016

419-1 Non-compliance with laws and regulations in the social and economic area

Page 111


Omission


nation


GP5024 Issue 2

Our responsibility is to express an opinion on the text, data, graphs and statements within the scope of verification with the intention to inform all Omnicane Limited’s stakeholders. The SGS protocols are based upon internationally recognized guidance, including the Principles contained within the Global Reporting Initiative (GRI) Sustainability Reporting Guidelines (2013) for accuracy and reliability and the guidance on levels of assurance contained within the AA1000 series of standards and guidance for Assurance Providers. This report has been assured at a high level of scrutiny using our protocols for:

• evaluation of content veracity; • evaluation of the report against the Global Reporting Initiative Sustainability Reporting Guidelines

(GRI Standards 2016) The assurance comprised a combination of pre-assurance research, interviews with relevant employees at Omnicane Management and Consultancy Limited, Omnicane Limited – Agricultural Operations, Omnicane Milling Operations Limited – Raw House & Refinery, Omnicane Thermal Energy Operations (St Aubin) Limited, Omnicane Thermal Energy Operations (La Baraque) Limited, Omnicane Logistics Operations Limited, Omnicane Ethanol Production Limited, Holiday Inn Mauritius Airport Limited ; documentation and record reviewed and validation with external bodies and stakeholders where relevant. Financial data drawn directly from the independently audited financial accounts has not been checked back to source as part of the assurance process. STATEMENT OF INDEPENDENCE AND COMPETENCE SGS is the world’s leading inspection, verification, testing and certification company. SGS is recognized as the global benchmark for quality and integrity. With more than 95,000 employees, SGS operates a network of over 2,400 offices and laboratories around the world including Certification and Business Enhancement; quality, environmental, social and ethical auditing and training; and Sustainability report assurance. SGS (Mauritius) Ltd affirm our independence from Omnicane Limited, being free from bias and conflicts of interest with the organisation, its subsidiaries and stakeholders. The assurance team was assembled based on their knowledge, experience and qualifications for this assignment, and comprised auditors registered with SAAS with Social audit, Quality and Environment backgrounds. VERIFICATION/ ASSURANCE OPINION On the basis of the methodology described and the verification work performed, we are satisfied that the information and data contained within OMNICANE INTEGRATED REPORT 2018 verified is accurate, reliable and provides a fair and balanced representation of Omnicane Limited sustainability activities in 2018. The assurance team is of the opinion that the Report can be used by the Reporting Organisation’s Stakeholders. We believe that the organisation has chosen an appropriate level of assurance for this stage in their reporting. GLOBAL REPORTING INITIATIVE REPORTING GUIDELINES CONCLUSIONS, FINDINGS AND RECOMMENDATIONS In our opinion, the OMNICANE INTEGRARTED REPORT 2018 is presented in accordance with the option of GRI Standards 2016 and fulfills the required content and quality criteria. The Omnicane Integrated Report 2018 is as per the Global Reporting Initiative Standards 2016.

09 / Annexes

Annex 3SGS Certificate – External Assurance (cont’d)

GP5024 Issue 2

GRI Reporting Standard principles have been in determining the scope of the report, content structure and quality and data calculation and disclosure techniques. The content of this report discloses the annual performance in between January 1, 2018 and December 31, 2018, together with trend analysis with the last three years in some cases. Summary of Findings Improvement Opportunities:

• Completeness -To ensure that the whole report is ready and finalised before the assurance exercise so that the assurance exercise can be carried out with more efficiency. Delays in providing the source of data and evidence were noted.

• Accuracy – To ensure that facts and figures are accurate and are consistent throughout the report. • Accuracy - Figures from audited account report not reported as they are. • Coherency – To ensure coherency in facts and figures from the introduction that is the Chairman’s

statement and CEO statement to the operations.

Best Practices:

• Automated reports and Data in the Millings Operations, Refinery Operations and Energy Productions minimizing potential for errors in data.

• Good graphical display was evident for previous year’s comparison. Recommendations:

• To ensure that details in the Chairman’s and CEO’s statement are found in the Operation report in the

report so as to ensure coherency.

• To ensure that supplier evaluation take into consideration sustainability requirements. At the moment, it is solely based on Food Safety.

Signed: For and on behalf of SGS (Mauritius) Ltd

Rosida DHOOKHUN Daniel JULIE Lead Assurer Certification and Business Enhancement Regional Business Manager SGS (Mauritius) Ltd SGS (Mauritius) Ltd 03/05/2019 WWW.SGS.COM


Annex 4 Administration

09 / Annexes

Managers & Secretaries Omnicane Management & Consultancy Limited

Registered Office Omnicane HouseMon Trésor Business Gateway New Airport Access Road Plaine Magnien 51521

Postal Address P.O. Box 159, Port Louis

Telephone (230) 660 0600

Telefax (230) 211 7093

E-mail [email protected]

Transfer Secretaries Harel MallacCorporate Services Ltd 1st Floor – Harel Mallac Building18 Edith Cavell Street,Port Louis

Auditors BDO & Co

Legal Advisors ENS Africa Benoit Chambers Juristconsult Chambers

Bankers Afrasia Bank Limited ABC Banking Corporation Ltd Bank One Limited Barclays Bank Mauritius Limited Bank of Baroda Habib Bank Ltd MauBank Ltd Standard Bank (Mauritius) Ltd State Bank of India State Bank (Mauritius) Ltd The Hongkong and Shanghai Banking Corporation Ltd The Mauritius Commercial Bank Ltd European Investment Bank

Corporate Advisors Ernst & Young PriceWaterhouse Coopers

Notary Etude Maigrot Etude Dwarka

Annex 5 Proxy Form – For the 93rd Annual Meeting

09 / Annexes

I/We_______________________________________________________________________________________________________

of_________________________________________________________________________________________________________

being a shareholder/s of Omnicane Limited, do hereby appoint

Mr/Mrs____________________________________________________________________________________________________

of__________________________________________________________________________________________ or failing him/her

Mr/Mrs____________________________________________________________________________________________________

of_________________________________________________________________________________________________________

as my/our proxy to vote for me/us at the meeting of the Company to be held on Thursday, June 27, 2019 at 10:00 hrs and at any adjournment thereof.

I/We desire my/our vote(s) to be cast on the Resolution as follows:

Signed this____________________day of_________________________ 2019

Number of shares held:__________________ (1 share = 1 vote)

Signature:_________________________________________________________

Mark with X where applicable

For Against Abstain

1 To consider and approve the Annual Report including the audited financial statements for the year ended December 31, 2018.

2-5 To re-appoint as Directors the following persons who retire by rotation in terms of Clause 20.5 of the Constitution and, being eligible, offer themselves for re-election (as separate resolutions)

2 Mr Didier Maigrot

3 Mr Bertrand Thevenau

4 Mr Marc Hein

5 Mr Pierre Marrier d’Unienville

6-7 To re-appoint as Directors the following persons who, appointed as Directors since the last Annual Meeting, retire in terms of the Constitution and, being eligible, offer themselves for re-election:

6 Mr Jimmy Tong Sam

7 Mr Koosiram Conhye

8 To appoint BDO & Co. as auditors until the conclusion of the next Annual Meeting of the Company and to authorise the Board to fix their remuneration.


09 / Annexes

Annex 5Proxy Form – For the 93rd Annual Meeting (cont’d)

Notes

1. A member entitled to attend and vote at the meeting is entitled to appoint one or more proxies to attend, speak and vote in his/her stead. A proxy need not be a member of the Company.

2. If this proxy form is returned without any indication as to how the proxy

should vote, the proxy will be entitled to vote or abstain from voting as he/she thinks fit.

3. A minor must be assisted by his/her guardian. 4. The authority of a person signing a proxy in a representative capacity must

be attached to the proxy unless that authority has already been recorded by the Company.

5. In order to be effective, proxy forms must reach the registered office of the Company, 2nd Floor – Omnicane House, Mon Trésor Business Gateway, New Airport Access Road – Plaine Magnien not later that 10:00 hrs on Wednesday, June 26, 2019.

6. The delivery of the duly completed form shall not preclude any member or

his/her duly authorised representative from attending the meeting, speaking and voting instead of such duly appointed proxy.

7. If two or more proxies attend the meeting, then that person attending the

meeting whose name appears first on the proxy form, and whose name is not deleted, shall be regarded as the validly appointed proxy.

240 OMNICANE INTEGRATED REPORT 2018

www.omnicane.com

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