Notes to the reviewed condensed group annual financial statements
1. CORPORATE BACKGROUND
Exxaro, a public company incorporated in South Africa, is a diversified resources group with interests in the coal (controlled and non-controlled), energy (controlled) and ferrous (controlled and non-controlled) markets. These reviewed condensed group financial statements as at and for the year ended 31 December 2023 (condensed financial statements) comprise the company and its subsidiaries (together referred to as the group) and the group’s interest in associates and joint ventures.
2. BASIS OF PREPARATION
2.1 Statement of compliance
The condensed financial statements have been prepared in accordance with and contain the information required by the JSE Listings Requirements for condensed financial statements and the requirements of the Companies Act of South Africa. The JSE Listings Requirements require condensed financial statements to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS ® Accounting Standards) (as issued by the International Accounting Standards Board (IASB ® )), IAS 34 Interim Financial Reporting, Financial Pronouncements (as issued by the Financial Reporting Standards Council), and the SAICA Financial Reporting Guides (as issued by the Accounting Practices Committee).
The condensed financial statements have been prepared under the supervision of Mr PA Koppeschaar CA(SA), SAICA registration number: 00038621.
The condensed financial statements should be read in conjunction with the group annual financial statements as at and for the year ended 31 December 2022, which have been prepared in accordance with IFRS Accounting Standards. The condensed financial statements have been prepared on the historical cost basis, except for financial instruments, share-based payments and biological assets, which are measured at fair value.
The condensed financial statements of the Exxaro group were authorised for issue by the board of directors on 12 March 2024.
2.2 Judgements and estimates
Management made judgements and applied estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. The significant judgements and the key source of estimation uncertainty were similar to those applied to the group annual financial statements as at and for the year ended 31 December 2022.
3. ACCOUNTING POLICIES AND OTHER COMPLIANCE MATTERS
The accounting policies applied are in terms of IFRS Accounting Standards and are consistent with those of the previous financial year. A number of new or amended IFRS Accounting Standards became effective for the current year. The group did not have to make any significant changes to its accounting policies nor make retrospective adjustments as a result of adopting these standards.
3.1 Impact of new, amended or revised standards issued but not yet effective
New IFRS Accounting Standards, amendments to accounting standards and interpretations issued, that are relevant to the group, but not yet effective on 31 December 2023, have not been early adopted, except for the amendment to IAS 1 Presentation of Financial Statements relating to classification of liabilities as current or non-current as well as non-current liabilities with covenants. The early adoption of these amendments did not have any impact on the group. The group continuously evaluates the impact of these standards and amendments.
4. RECONCILIATION OF GROUP HEADLINE EARNINGS
Gross Rm |
Tax Rm |
NCI Rm |
Net Rm |
|||
For the year ended 31 December 2023 (Reviewed) |
||||||
Profit attributable to owners of the parent |
11 292 |
|||||
Adjusted for: |
61 |
(15) |
(11) |
35 |
||
– IAS 16 Net losses on disposal of property, plant and equipment |
57 |
(15) |
(10) |
32 |
||
– IAS 28 Share of equity-accounted investments’ separately identifiable remeasurements |
4 |
|
(1) |
3 |
||
Headline earnings |
11 327 |
|||||
For the year ended 31 December 2022 (Audited) |
||||||
Profit attributable to owners of the parent |
13 826 |
|||||
Adjusted for: |
1 285 |
(333) |
(220) |
732 |
||
– IFRS 10 Loss on disposal of subsidiary |
1 |
|
|
1 |
||
– IAS 16 Net losses on disposal of property, plant and equipment |
97 |
(27) |
(17) |
53 |
||
– IAS 28 Loss on dilution of investment in associate |
2 |
|
|
2 |
||
– IAS 28 Share of equity-accounted investments’ separately identifiable remeasurements 1 |
1 132 |
(306) |
(191) |
635 |
||
– IAS 36 Impairment charges of non-current assets 2 |
53 |
|
(12) |
41 |
||
Headline earnings |
14 558 |
|||||
1 Includes Exxaro’s share of SIOC’s impairment charge recognised on mining assets, amounting to R626 million (net of tax and NCI). The impairment charge on mining assets was due to the production volumes being revised down in line with anticipated logistics performance. 2 On 31 December 2022, the investment in LightApp was impaired to nil. |
2023 Reviewed cents |
2022 Audited cents |
||
Headline earnings per share |
|
|
|
– Basic |
4 681 |
6 016 |
|
– Diluted |
4 681 |
6 016 |
|
Refer note 5 for details regarding the number of shares. |
5. DIVIDEND DISTRIBUTIONS
An interim cash dividend, number 41, for 2023 of 1 143 cents per share amounting to R2 761 million (to external shareholders) was declared on 15 August 2023 and paid on 2 October 2023.
A final cash dividend, number 42, for 2023 of 1 010 cents per share, was approved by the board of directors on 12 March 2024. The dividend is payable on 13 May 2024 to shareholders who will be on the register on 10 May 2024. This final dividend, amounting to approximately R2 439 million (to external shareholders), has not been recognised as a liability in these condensed financial statements. It will be recognised in shareholders’ equity in the first half of the year ending 31 December 2024.
The final dividend declared from income reserves, will be subject to a dividend withholding tax of 20% for all shareholders who are not exempt from or do not qualify for a reduced rate of dividend withholding tax. The net local dividend payable to shareholders, subject to dividend withholding tax at a rate of 20% amounts to 808.00000 cents per share.
Given the net cash position at 31 December 2023 of R14 834 million (excluding energy’s net debt), the board of directors has resolved to pay a special dividend of 572 cents per share. The special dividend is subject to SARB approval. A further announcement will be released once SARB approval has been obtained. The special dividend, amounting to approximately R1 382 million (to external shareholders), has not been recognised as a liability in these condensed financial statements. It will be recognised in shareholder’s equity in the first half of the year ending 31 December 2024.
The special dividend declared from income reserves, will be subject to a dividend withholding tax of 20% for all shareholders who are not exempt from or do not qualify for a reduced rate of dividend withholding tax. The net local dividend payable to shareholders, subject to dividend withholding tax at a rate of 20% amounts to 457.60000 cents per share.
The number of ordinary shares in issue at the date of this declaration is 349 305 092. Exxaro company’s tax reference number is 9218/098/14/4.
For the year ended 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Dividends paid |
5 505 |
6 686 |
|
Final dividend |
2 744 |
2 838 |
|
Interim dividend |
2 761 |
3 848 |
|
cents |
cents |
||
Dividend paid per share |
2 279 |
2 768 |
|
Final dividend |
1 136 |
1 175 |
|
Interim dividend |
1 143 |
1 593 |
|
At 31 December |
|||
2023 Reviewed |
2022 Audited |
||
Issued share capital (number of shares) 1 |
349 305 092 |
349 305 092 |
|
Ordinary shares (millions) |
|||
– Weighted average number of shares |
242 |
242 |
|
– Diluted weighted average number of shares |
242 |
242 |
1 Includes treasury shares of 107 770 244 (2022: 107 770 244).
6. SEGMENTAL INFORMATION
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision maker, who is responsible for allocating resources and assessing performance of the reportable operating segments. The chief operating decision maker has been defined as the executive committees of the group. Segments reported are based on the group’s different commodities and operations.
In line with reporting trends, emphasis is placed on controllable costs. Indirect corporate costs are reported on a gross level in the other reportable segment. The performance of the operating segments is assessed based on EBITDA, which is considered to be a more appropriate performance measure of profitability for the group’s business (refer note 26.1).
The segments, as described below, offer different goods and services, and are managed separately based on commodity, location and support function grouping. The group executive committees review internal management reports on these operating segments at least quarterly.
Coal
The coal operations produce thermal coal, metallurgical coal and SSCC and are made up of the following reportable segments:
Commercial Waterberg: Comprising mainly of the Grootegeluk operation.
Commercial Mpumalanga: Comprising of the Belfast and Leeuwpan operations, as well as the 50% (2022: 50%) joint venture in Mafube with Thungela.
Tied: Comprising of the Matla mine supplying its entire coal supply to Eskom.
Other: Comprising of the other coal affiliated operations, including mines in closure and a 10.26% (2022: 10.26%) equity interest in RBCT.
The export revenue and related export cost items are allocated between the coal reportable segments and disclosed based on the origin of the initial coal production.
Energy
The energy operations generate electricity from renewable energy technology. The energy reportable segment comprises mainly of the Cennergi controlled operation.
Ferrous
The ferrous operations are made up of the following reportable segments:
Alloys: Comprising of the FerroAlloys operation which manufactures ferrosilicon.
Other: Comprising mainly of the 20.62% (2022: 20.62%) equity interest in SIOC.
Other
The other operations of the group are made up of the following reportable segments:
Base metals: Comprising of the 26% (2022: 26%) equity interest in Black Mountain.
Other: Comprising mainly of the corporate office (rendering corporate management services), the Ferroland agricultural operation, the 25.85% (2022: 25.85%) equity interest in Insect Technology and the 28.01% (2022: 28.01%) equity interest in LightApp.
The following tables present a summary of the group’s segmental information:
Coal |
|||||||
Commercial |
|||||||
For the year ended 31 December 2023 (Reviewed) |
Water- berg Rm |
Mpuma- langa Rm |
Tied Rm |
Other Rm |
Energy Rm |
||
External revenue (note 7) |
22 496 |
8 666 |
5 783 |
|
1 345 |
||
Segmental net operating profit/(loss) |
10 173 |
399 |
173 |
(681) |
630 |
||
Add back: |
|||||||
Depreciation and amortisation (note 8) |
1 512 |
595 |
6 |
16 |
393 |
||
Net losses on disposal of property, plant and equipment (note 8) |
17 |
3 |
|
|
|
||
EBITDA 1 (note 26.1) |
11 702 |
997 |
179 |
(665) |
1 023 |
||
Other key items: |
|||||||
Share of income/(loss) of equity-accounted investments (note 11) |
|
508 |
|
(10) |
|
||
External finance income (note 10) |
26 |
8 |
|
61 |
40 |
||
External finance costs (note 10) |
(66) |
(97) |
|
(79) |
(515) |
||
Income tax expense |
(2 603) |
(105) |
(27) |
(111) |
(71) |
||
Raw materials and consumables (note 8) 1 |
(2 002) |
(2 755) |
(497) |
(2) |
(1) |
||
Staff costs (note 8) 1 |
(2 740) |
(395) |
(1 737) |
(253) |
(68) |
||
Royalties (note 8) 1; 2 |
(1 188) |
(108) |
(13) |
167 |
|
||
Contract mining (note 8) 1 |
(60) |
(1 434) |
|
|
|
||
Repairs and maintenance (note 8) 1 |
(1 677) |
(282) |
(975) |
(1) |
(9) |
||
Railage and transport (note 8) 1 |
(1 744) |
(1 424) |
(6) |
|
|
||
Movement in provisions (note 8) 1 |
151 |
(80) |
53 |
(195) |
|
||
Cash generated by/(utilised in) operations (note 9) |
11 758 |
89 |
148 |
(203) |
1 031 |
||
Capital spend on property, plant and equipment (note 12) |
(2 217) |
(201) |
|
(15) |
(244) |
||
At 31 December 2023 (Reviewed) |
|||||||
Segmental assets and liabilities |
|||||||
Deferred tax 3 |
|
|
|
|
14 |
||
Equity-accounted investments (note 13) |
|
1 922 |
|
2 014 |
|
||
External assets |
31 930 |
6 084 |
1 506 |
2 774 |
8 834 |
||
Total assets |
31 930 |
8 006 |
1 506 |
4 788 |
8 848 |
||
External liabilities |
2 590 |
2 451 |
1 600 |
779 |
5 121 |
||
Deferred tax 3 |
7 335 |
856 |
(60) |
2 |
903 |
||
Total liabilities |
9 925 |
3 307 |
1 540 |
781 |
6 024 |
||
1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment. 2 Calculated per legal entity. 3 Offset per legal entity and tax authority. |
Ferrous |
Other |
|||||||
For the year ended 31 December 2023 (Reviewed) |
Alloys Rm |
Other ferrous Rm |
Base metals Rm |
Other Rm |
Total Rm |
|||
External revenue (note 7) |
398 |
|
|
10 |
38 698 |
|||
Segmental net operating profit/(loss) |
82 |
|
|
(149) |
10 627 |
|||
Add back: |
||||||||
Depreciation and amortisation (note 8) |
1 |
|
|
192 |
2 715 |
|||
Net losses on disposal of property, plant and equipment (note 8) |
|
|
|
37 |
57 |
|||
EBITDA 1 (note 26.1) |
83 |
|
|
80 |
13 399 |
|||
Other key items: |
||||||||
Share of income/(loss) of equity-accounted investments (note 11) |
|
6 157 |
332 |
|
6 987 |
|||
External finance income (note 10) |
|
|
|
1 435 |
1 570 |
|||
External finance costs (note 10) |
(1) |
|
|
(494) |
(1 252) |
|||
Income tax expense |
(18) |
|
(296) |
(3 231) |
||||
Raw materials and consumables (note 8) 1 |
(58) |
|
|
(17) |
(5 332) |
|||
Staff costs (note 8) 1 |
(69) |
|
|
(829) |
(6 091) |
|||
Royalties (note 8) 1;2 |
|
|
|
|
(1 142) |
|||
Contract mining (note 8) 1 |
|
|
|
|
(1 494) |
|||
Repairs and maintenance (note 8) 1 |
(6) |
|
|
(19) |
(2 969) |
|||
Railage and transport (note 8) 1 |
(3) |
(1) |
(3 178) |
|||||
Movement in provisions (note 8) 1 |
|
|
1 |
(70) |
||||
Cash generated by/(utilised in) operations (note 9) |
234 |
|
|
250 |
13 307 |
|||
Capital spend on property, plant and equipment (note 12) |
(1) |
|
|
(21) |
(2 699) |
|||
At 31 December 2023 (Reviewed) |
|
|
||||||
Segmental assets and liabilities |
||||||||
Deferred tax 3 |
9 |
|
|
183 |
206 |
|||
Equity-accounted investments (note 13) |
|
14 079 |
2 263 |
|
20 278 |
|||
External assets |
300 |
26 |
|
20 916 |
72 370 |
|||
Total assets |
309 |
14 105 |
2 263 |
21 099 |
92 854 |
|||
External liabilities |
40 |
3 |
|
4 860 |
17 444 |
|||
Deferred tax 3 |
|
|
|
(33) |
9 003 |
|||
Total liabilities |
40 |
3 |
|
4 827 |
26 447 |
|||
1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment. 2 Calculated per legal entity. 3 Offset per legal entity and tax authority. |
Coal |
|||||||
Commercial |
|||||||
For the year ended 31 December 2022 (Audited) |
Water- berg Rm |
Mpuma- langa Rm |
Tied Rm |
Other Rm |
Energy Rm |
||
External revenue (note 7) |
23 613 |
15 797 |
5 561 |
|
1 159 |
||
Segmental net operating profit/(loss) |
11 731 |
5 323 |
151 |
(389) |
437 |
||
Add back: |
|||||||
Depreciation and amortisation (note 8) |
1 490 |
609 |
14 |
6 |
391 |
||
Net losses on disposal of property, plant and equipment (note 8) |
9 |
72 |
|
7 |
|
||
Loss on disposal of subsidiary |
|
|
|
|
|
||
Loss on dilution of investment in associate |
|
|
|
|
|
||
EBITDA 1 (note 26.1) |
13 230 |
6 004 |
165 |
(376) |
828 |
||
Other key items: |
|||||||
Share of income/(loss) of equity-accounted investments (note 11) |
|
1 902 |
|
(10) |
|
||
External finance income (note 10) |
24 |
4 |
|
5 |
20 |
||
External finance costs (note 10) |
(58) |
(91) |
|
(62) |
(503) |
||
Income tax (expense)/benefit |
(3 178) |
(1 307) |
(61) |
473 |
60 |
||
Raw materials and consumables (note 8) 1 |
(1 880) |
(5 123) |
(507) |
|
|
||
Staff costs (note 8) 1 |
(2 573) |
(371) |
(1 577) |
(258) |
(54) |
||
Royalties (note 8) 1; 2 |
(1 539) |
(324) |
(25) |
67 |
|
||
Contract mining (note 8) 1 |
(8) |
(803) |
(1) |
|
|
||
Repairs and maintenance (note 8) 1 |
(1 470) |
(292) |
(999) |
|
(7) |
||
Railage and transport (note 8) 1 |
(1 386) |
(1 586) |
(8) |
(35) |
|
||
Movement in provisions (note 8) 1 |
48 |
(221) |
(188) |
(106) |
|
||
Impairment charges of equity-accounted investments |
|
|
|
|
|
||
Cash generated by/(utilised in) operations (note 9) |
12 874 |
6 539 |
267 |
(1 459) |
837 |
||
Capital spend on property, plant and equipment (note 12) |
(1 348) |
(252) |
|
(5) |
(20) |
||
At 31 December 2022 (Audited) |
|||||||
Segmental assets and liabilities |
|||||||
Deferred tax 3 |
|
|
|
|
1 |
||
Equity-accounted investments (note 13) |
|
2 999 |
|
2 024 |
|
||
External assets |
30 897 |
6 068 |
1 213 |
3 258 |
8 614 |
||
Total assets |
30 897 |
9 067 |
1 213 |
5 282 |
8 615 |
||
External liabilities |
1 857 |
2 577 |
1 301 |
1 143 |
4 804 |
||
Deferred tax 3 |
6 997 |
978 |
(56) |
(108) |
884 |
||
Total liabilities |
8 854 |
3 555 |
1 245 |
1 035 |
5 688 |
||
1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment. 2 Calculated per legal entity. 3 Offset per legal entity and tax authority. |
Ferrous |
Other |
|||||||
For the year ended 31 December 2022 (Audited) |
Alloys Rm |
Other ferrous Rm |
Base metals Rm |
Other Rm |
Total Rm |
|||
External revenue (note 7) |
224 |
|
|
15 |
46 369 |
|||
Segmental net operating profit/(loss) |
49 |
(1) |
|
(1 081) |
16 220 |
|||
Add back: |
||||||||
Depreciation and amortisation (note 8) |
7 |
|
|
164 |
2 681 |
|||
Net losses on disposal of property, plant and equipment (note 8) |
|
|
|
9 |
97 |
|||
Loss on disposal of subsidiary |
|
|
|
1 |
1 |
|||
Loss on dilution of investment in associate |
2 |
2 |
||||||
EBITDA 1 (note 26.1) |
56 |
(1) |
(905) |
19 001 |
||||
Other key items: |
||||||||
Share of income/(loss) of equity-accounted
|
|
4 077 |
578 |
(70) |
6 477 |
|||
External finance income (note 10) |
|
|
|
641 |
694 |
|||
External finance costs (note 10) |
(1) |
|
|
(337) |
(1 052) |
|||
Income tax (expense)/benefit |
(5) |
|
(269) |
(4 287) |
||||
Raw materials and consumables (note 8) 1 |
(94) |
|
|
(16) |
(7 620) |
|||
Staff costs (note 8) 1 |
(58) |
|
|
(971) |
(5 862) |
|||
Royalties (note 8) 1; 2 |
|
|
|
|
(1 821) |
|||
Contract mining (note 8) 1 |
|
|
|
|
(812) |
|||
Repairs and maintenance (note 8) 1 |
(7) |
|
|
(10) |
(2 785) |
|||
Railage and transport (note 8) 1 |
(2) |
|
|
(2) |
(3 019) |
|||
Movement in provisions (note 8) 1 |
|
|
|
(7) |
(474) |
|||
Impairment charges of equity-accounted investments |
|
|
|
(53) |
(53) |
|||
Cash generated by/(utilised in) operations (note 9) |
(22) |
(1) |
|
(172) |
18 863 |
|||
Capital spend on property, plant and equipment (note 12) |
(1) |
|
|
(26) |
(1 652) |
|||
At 31 December 2022 (Audited) |
||||||||
Segmental assets and liabilities |
||||||||
Deferred tax 3 |
11 |
1 |
|
241 |
254 |
|||
Equity-accounted investments (note 13) |
|
11 104 |
1 933 |
|
18 060 |
|||
External assets |
421 |
25 |
|
16 335 |
66 831 |
|||
Total assets |
432 |
11 130 |
1 933 |
16 576 |
85 145 |
|||
External liabilities |
26 |
1 |
|
5 389 |
17 098 |
|||
Deferred tax 3 |
|
|
|
(27) |
8 668 |
|||
Total liabilities |
26 |
1 |
|
5 362 |
25 766 |
|||
1 Additional key items included in the measure of segment profit or loss have been presented for each reportable segment. 2 Calculated per legal entity. 3 Offset per legal entity and tax authority. |
7. REVENUE
Revenue is derived from contracts with customers. Revenue has been disaggregated based on timing of revenue recognition, major type of goods and services, major geographic area and major customer industries.
Coal |
Ferrous |
Other |
|||||||||||
Commercial |
|||||||||||||
For the year ended
|
Water- berg Rm |
Mpuma- langa Rm |
Tied Rm |
Other Rm |
Energy Rm |
Alloys Rm |
Other Rm |
Total Rm |
|||||
Segmental revenue reconciliation |
|||||||||||||
Segmental revenue 1 |
22 496 |
8 666 |
5 783 |
|
1 345 |
398 |
10 |
38 698 |
|||||
Export sales allocated to selling entity 2 |
(4 538) |
(6 539) |
|
11 077 |
|
|
|
|
|||||
Total revenue |
17 958 |
2 127 |
5 783 |
11 077 |
1 345 |
398 |
10 |
38 698 |
|||||
By timing and major type of goods and services |
|||||||||||||
Revenue recognised at a point in time |
17 958 |
2 127 |
4 729 |
11 077 |
|
392 |
9 |
36 292 |
|||||
Coal |
17 958 |
2 127 |
4 729 |
11 077 |
35 891 |
||||||||
Ferrosilicon |
392 |
392 |
|||||||||||
Biological goods |
9 |
9 |
|||||||||||
Revenue recognised over time |
|
|
1 054 |
|
1 345 |
6 |
1 |
2 406 |
|||||
Renewable energy |
|
|
|
|
1 345 |
|
|
1 345 |
|||||
Stock yard management services |
|
|
159 |
|
|
|
|
159 |
|||||
Project engineering services |
|
|
895 |
|
|
|
|
895 |
|||||
Transportation services |
|
|
|
|
|
2 |
|
2 |
|||||
Other services |
|
|
|
|
|
4 |
1 |
5 |
|||||
Total revenue |
17 958 |
2 127 |
5 783 |
11 077 |
1 345 |
398 |
10 |
38 698 |
|||||
By major geographic area of customer 3 |
|||||||||||||
Domestic |
17 958 |
2 127 |
5 783 |
|
1 345 |
398 |
8 |
27 619 |
|||||
Export |
|
|
|
11 077 |
|
|
2 |
11 079 |
|||||
Europe 4 |
|
|
|
5 522 |
|
|
1 |
5 523 |
|||||
Asia 5 |
|
|
|
4 600 |
|
|
1 |
4 601 |
|||||
Other |
|
|
|
955 |
|
|
|
955 |
|||||
Total revenue |
17 958 |
2 127 |
5 783 |
11 077 |
1 345 |
398 |
10 |
38 698 |
|||||
By major customer industries |
|||||||||||||
Public utilities |
14 963 |
|
5 783 |
511 |
1 345 |
|
|
22 602 |
|||||
Merchants |
370 |
1 230 |
|
9 826 |
|
2 |
|
11 428 |
|||||
Steel |
1 462 |
152 |
|
|
|
|
|
1 614 |
|||||
Mining |
250 |
23 |
|
|
|
351 |
|
624 |
|||||
Manufacturing |
357 |
|
|
|
|
45 |
|
402 |
|||||
Food and beverage |
233 |
|
|
|
|
|
2 |
235 |
|||||
Cement |
262 |
70 |
|
314 |
|
|
|
646 |
|||||
Chemicals |
|
646 |
|
|
|
|
|
646 |
|||||
Other |
61 |
6 |
|
426 |
|
|
8 |
501 |
|||||
Total revenue |
17 958 |
2 127 |
5 783 |
11 077 |
1 345 |
398 |
10 |
38 698 |
|||||
1 Coal segmental revenue is based on the origin of coal production. 2 Relates to revenue sold by export distribution entity. 3 Determined based on the customer supplied by Exxaro. 4 Relates mainly to Switzerland and Germany. 5 Relates mainly to Singapore and Japan. |
Coal |
Ferrous |
Other |
|||||||||||
Commercial |
|||||||||||||
For the year ended
|
Water– berg Rm |
Mpuma– langa Rm |
Tied Rm |
Other Rm |
Energy Rm |
Alloys Rm |
Other Rm |
Total Rm |
|||||
Segmental revenue reconciliation |
|||||||||||||
Segmental revenue 1 |
23 613 |
15 797 |
5 561 |
|
1 159 |
224 |
15 |
46 369 |
|||||
Export sales allocated to selling entity 2 |
(7 621) |
(13 769) |
|
21 390 |
|
|
|
|
|||||
Total revenue |
15 992 |
2 028 |
5 561 |
21 390 |
1 159 |
224 |
15 |
46 369 |
|||||
By timing and major type of goods and services |
|||||||||||||
Revenue recognised at a point in time |
15 992 |
2 028 |
4 311 |
21 390 |
|
220 |
13 |
43 954 |
|||||
Coal |
15 992 |
2 028 |
4 311 |
21 390 |
43 721 |
||||||||
Ferrosilicon |
220 |
220 |
|||||||||||
Biological goods |
13 |
13 |
|||||||||||
Revenue recognised over time |
|
|
1 250 |
|
1 159 |
4 |
2 |
2 415 |
|||||
Renewable energy |
|
|
|
|
1 159 |
|
|
1 159 |
|||||
Stock yard management services |
|
|
125 |
|
|
|
|
125 |
|||||
Project engineering services |
|
|
1 125 |
|
|
|
|
1 125 |
|||||
Transportation services |
|
|
|
|
|
2 |
|
2 |
|||||
Other services |
|
|
|
|
|
2 |
2 |
4 |
|||||
Total revenue |
15 992 |
2 028 |
5 561 |
21 390 |
1 159 |
224 |
15 |
46 369 |
|||||
By major geographic area of customer 3 |
|||||||||||||
Domestic |
15 992 |
2 028 |
5 561 |
|
1 159 |
224 |
14 |
24 978 |
|||||
Export |
|
|
|
21 390 |
|
|
1 |
21 391 |
|||||
Europe 4 |
|
|
|
16 984 |
|
|
|
16 984 |
|||||
Asia 5 |
|
|
|
3 899 |
|
|
1 |
3 900 |
|||||
Other |
|
|
|
507 |
|
|
|
507 |
|||||
Total revenue |
15 992 |
2 028 |
5 561 |
21 390 |
1 159 |
224 |
15 |
46 369 |
|||||
By major customer industries |
|||||||||||||
Public utilities |
13 287 |
|
5 561 |
940 |
1 159 |
|
|
20 947 |
|||||
Merchants |
315 |
1 363 |
|
19 840 |
|
|
|
21 518 |
|||||
Steel |
1 317 |
125 |
|
|
|
|
|
1 442 |
|||||
Mining |
242 |
44 |
|
|
|
180 |
|
466 |
|||||
Manufacturing |
407 |
6 |
|
213 |
|
44 |
|
670 |
|||||
Food and beverage |
145 |
|
|
|
|
|
1 |
146 |
|||||
Cement |
223 |
|
|
158 |
|
|
|
381 |
|||||
Chemicals |
|
481 |
|
|
|
|
|
481 |
|||||
Other |
56 |
9 |
|
239 |
|
|
14 |
318 |
|||||
Total revenue |
15 992 |
2 028 |
5 561 |
21 390 |
1 159 |
224 |
15 |
46 369 |
|||||
1 Coal segmental revenue is based on the origin of coal production. 2 Relates to revenue sold by export distribution entity. 3 Determined based on the customer supplied by Exxaro. 4 Relates mainly to Switzerland and UK. 5 Relates mainly to Singapore and Japan. |
8. SIGNIFICANT ITEMS INCLUDED IN OPERATING EXPENSES
For the year ended 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Raw materials and consumables |
(5 332) |
(7 620) |
|
Staff costs |
(6 091) |
(5 862) |
|
Royalties |
(1 142) |
(1 821) |
|
Contract mining |
(1 494) |
(812) |
|
Repairs and maintenance |
(2 969) |
(2 785) |
|
Railage and transport |
(3 178) |
(3 019) |
|
Movement in provisions (note 18) |
(70) |
(474) |
|
Depreciation and amortisation |
(2 715) |
(2 681) |
|
- Depreciation of property, plant and equipment |
(2 483) |
(2 457) |
|
- Depreciation of right-of-use assets |
(57) |
(58) |
|
- Amortisation of intangible assets |
(175) |
(166) |
|
Net losses on disposal of property, plant and equipment |
(57) |
(97) |
|
Net realised and unrealised currency exchange differences |
124 |
777 |
|
Loss on dilution of investment in associate |
|
(2) |
|
Legal and professional fees |
(487) |
(387) |
|
ECLs on financial assets at amortised cost |
(21) |
(79) |
9. CASH GENERATED BY OPERATIONS
For the year ended 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Profit before tax |
17 934 |
22 292 |
|
Adjusted for: |
|||
Finance income |
(1 570) |
(694) |
|
Finance costs |
1 252 |
1 052 |
|
Dividend income from financial assets |
(2) |
(6) |
|
Share of income of equity-accounted investments |
(6 987) |
(6 477) |
|
Impairment charges of equity-accounted investments |
|
53 |
|
Net operating profit |
10 627 |
16 220 |
|
Non-cash movements: |
|||
Depreciation and amortisation |
2 715 |
2 681 |
|
ECLs on financial assets at amortised cost |
21 |
79 |
|
Write-off of trade and other receivables and ESD loans |
6 |
4 |
|
Write-off of other current assets |
32 |
|
|
Movement in provisions |
70 |
474 |
|
Movement in retirement employee obligation |
11 |
9 |
|
Net currency exchange differences |
(46) |
32 |
|
Fair value adjustments on financial instruments |
(284) |
(51) |
|
Gain on termination of lease |
|
(3) |
|
Loss on termination of right-of-use asset |
|
1 |
|
Net losses on disposal of property, plant and equipment |
57 |
97 |
|
Loss on disposal of subsidiary |
|
1 |
|
Loss on dilution of investment in associate |
|
2 |
|
Indemnification asset movement |
5 |
(5) |
|
Share-based payment expense |
212 |
207 |
|
Hedge ineffectiveness on cash flow hedges |
18 |
13 |
|
Translation of net investment in foreign operations |
|
(8) |
|
Translation of foreign currency items |
(85) |
(351) |
|
Amortisation of transaction costs prepaid |
4 |
4 |
|
Non-cash recoveries |
23 |
(194) |
|
Non-cash deposit facilities |
(373) |
||
Non-cash management fees on deposit facilities |
53 |
||
Other non-cash movements |
8 |
5 |
|
Cash generated by operations before working capital movements |
13 074 |
19 217 |
|
Working capital movements |
|||
(Increase)/decrease in inventories |
(212) |
1 |
|
Decrease/(increase) in trade and other receivables |
449 |
(1 312) |
|
Increase in trade and other payables |
68 |
999 |
|
Utilisation of provisions |
(72) |
(42) |
|
Cash generated by operations |
13 307 |
18 863 |
10. NET FINANCING INCOME/(COSTS)
For the year ended 31 December |
|||||
2023 Reviewed Rm |
2022 Audited Rm |
||||
Finance income |
1 570 |
694 |
|||
Interest income |
1 573 |
692 |
|||
Reimbursement of interest income on environmental rehabilitation funds |
(9) |
(6) |
|||
Finance lease interest income |
6 |
7 |
|||
Commitment fee income |
|
1 |
|||
Finance costs |
(1 252) |
(1 052) |
|||
Interest expense |
(1 020) |
(783) |
|||
Net fair value gain/(loss) on interest rate swaps designated as cash flow hedges recycled from OCI: |
20 |
(97) |
|||
– Realised fair value loss |
(44) |
(163) |
|||
– Unrealised fair value gain |
64 |
66 |
|||
Unwinding of discount rate on rehabilitation costs |
(244) |
(228) |
|||
Recovery of unwinding of discount rate on rehabilitation costs |
28 |
30 |
|||
Interest expense on lease liabilities |
(48) |
(50) |
|||
Amortisation of transaction costs |
(5) |
(6) |
|||
Borrowing costs capitalised 1 |
17 |
82 |
|||
Total net financing income/(costs) |
318 |
(358) |
|||
1 Borrowing costs capitalisation rate (%) |
9.93 |
6.09 |
11. SHARE OF INCOME OF EQUITY-ACCOUNTED INVESTMENTS
For the year ended 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Associates |
6 479 |
4 575 |
|
SIOC |
6 157 |
4 077 |
|
RBCT |
(10) |
(10) |
|
Black Mountain |
332 |
578 |
|
LightApp |
|
(70) |
|
Joint ventures |
508 |
1 902 |
|
Mafube |
508 |
1 902 |
|
Share of income of equity-accounted investments |
6 987 |
6 477 |
12. CAPITAL SPEND AND CAPITAL COMMITMENTS
For the year ended 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Capital spend |
|||
To maintain operations |
2 455 |
1 401 |
|
To expand operations |
244 |
251 |
|
Total capital spend on property, plant and equipment |
2 699 |
1 652 |
|
At 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Capital commitments |
|||
Contracted |
4 115 |
3 749 |
|
- Contracted for the group (owner-controlled) |
2 115 |
1 614 |
|
- Share of capital commitments of associates 1 |
1 973 |
2 040 |
|
- Share of capital commitments of joint ventures 2 |
27 |
95 |
|
Authorised, but not contracted (owner-controlled) |
2 287 |
2 322 |
|
1 31 December 2022 has been restated to include an amount of R1 173 million relating to Black Mountain. 2 The share of capital commitments of equity-accounted investments line item has been represented to disclose the amounts on a disaggregated basis between associates and joint ventures. The share of capital commitments relating to Mafube was restated as it was not previously included in the aggregate amounts disclosed. |
13. EQUITY-ACCOUNTED INVESTMENTS
At 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Associates |
18 356 |
15 061 |
|
SIOC |
14 079 |
11 104 |
|
RBCT |
2 014 |
2 024 |
|
Black Mountain |
2 263 |
1 933 |
|
Joint ventures |
1 922 |
2 999 |
|
Mafube |
1 922 |
2 999 |
|
Total net carrying value of equity-accounted investments |
20 278 |
18 060 |
|
14. OTHER ASSETS
At 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Non-current |
729 |
770 |
|
Reimbursements 1 |
588 |
605 |
|
Biological assets |
33 |
38 |
|
Lease receivables |
29 |
38 |
|
Other |
79 |
89 |
|
Current |
482 |
572 |
|
VAT |
37 |
31 |
|
Diesel rebates |
58 |
100 |
|
Royalties |
69 |
95 |
|
Prepayments 2 |
254 |
283 |
|
Lease receivables |
9 |
8 |
|
Other |
55 |
55 |
|
Total other assets |
1 211 |
1 342 |
|
1 Amounts recoverable from Eskom in respect of the rehabilitation, environmental expenditure and retirement employee obligations of the Matla operation at the end of LoM. 2 2023: Includes an amount of R123 million which relates to advance payments for assets under construction. |
15. INTEREST-BEARING BORROWINGS
At 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Non-current 1 |
7 480 |
8 378 |
|
Loan facility |
2 945 |
3 391 |
|
Project financing 2 |
4 535 |
4 344 |
|
Bonds 3 |
|
643 |
|
Current 1 |
1 443 |
715 |
|
Loan facility |
507 |
502 |
|
Project financing 2 |
290 |
210 |
|
Bonds 3 |
646 |
3 |
|
Total interest-bearing borrowings |
8 923 |
9 093 |
|
Summary of interest-bearing borrowings by period of redemption: |
|||
Less than six months |
1 074 |
377 |
|
Six to 12 months |
369 |
338 |
|
Between one and two years |
794 |
1 361 |
|
Between two and three years |
2 948 |
795 |
|
Between three and four years |
556 |
2 947 |
|
Between four and five years |
682 |
554 |
|
Over five years |
2 500 |
2 721 |
|
Total interest-bearing borrowings |
8 923 |
9 093 |
|
1 Reduced by the amortisation of transaction costs: |
|||
– Non-current |
(17) |
(9) |
|
– Current |
(5) |
(5) |
|
2 Interest-bearing borrowings relating to the energy operations. |
|||
3 The R643 million senior unsecured floating rate note will mature in June 2024. |
Refer note 17 for the amounts repaid and raised in relation to interest-bearing borrowings.
There were no defaults or breaches in terms of interest-bearing borrowings during the reporting periods.
Below is a summary of the salient terms and conditions of the facilities at 31 December 2023:
Interest rate |
|||||||||||||
Instrument |
Security |
Interest payment basis |
Debt assumed date |
Maturity date |
Instrument |
Carrying value (Rm) |
Undrawn portion (Rm) |
Base rate |
Margin |
Effective rate for transaction costs |
|||
Loan facility |
Loan facility |
||||||||||||
Exxaro |
Bullet term loan |
Unsecured |
Floating |
26 Apr 2021 |
26 Apr 2026 |
Exxaro |
2 539 |
nil |
3-month JIBAR |
240 basis points (2.40%) |
0.11% |
||
Amortised term loan |
Unsecured |
Floating |
26 Apr 2021 |
26 Apr 2026 |
913 |
nil |
3-month JIBAR |
230 basis points (2.30%) |
0.10% |
||||
Revolving credit facility |
Unsecured |
Floating |
26 Apr 2021 |
26 Apr 2026 |
nil |
3 250 |
1-month JIBAR |
265 basis points (2.65%) |
N/A |
||||
Project financing |
Project financing |
||||||||||||
Amakhala SPV |
Term loan and reserve facility |
Secured |
Floating |
1 Apr 2020 |
30 Jun 2031 |
Amakhala SPV |
2 504 |
273 |
3-month JIBAR |
371 to 683 basis points
|
N/A |
||
Term loan |
Secured |
Fixed |
1 Apr 2020 |
30 Jun 2031 |
135 |
nil |
9.46% up to 30 June 2026, thereafter 3-month JIBAR |
360 to 670 basis points
|
N/A |
||||
Tsitsikamma SPV |
Term loan and reserve facility |
Secured |
Floating |
1 Apr 2020 |
31 Dec 2030 |
Tsitsikamma SPV |
1 709 |
155 |
3-month JIBAR |
277 basis points (2.77%) |
N/A |
||
LSP SPV |
Term loan and reserve facility |
Secured |
Floating |
11 Jul 2023 |
31 Dec 2042 |
LSP SPV |
463 |
803 |
3-month JIBAR |
250 to 360 basis points
|
0.01% were applicable |
||
Revolving credit facility |
Secured |
Floating |
11 Jul 2023 |
31 Dec 2024 |
14 |
36 |
3-month JIBAR |
180 basis points (1.80%) |
N/A |
||||
DMTN Programme (bonds) |
DMTN Programme (bonds) |
||||||||||||
Exxaro |
R643 million senior unsecured floating rate note |
Unsecured |
Floating |
13 Jun 2019 |
13 Jun 2024 |
Exxaro |
646 |
nil |
3-month JIBAR |
189 basis points (1.89%) |
N/A |
||
16. LEASE LIABILITIES
At 31 December |
|||
2023 Reviewed Rm |
2022 Audited Rm |
||
Non-current |
400 |
438 |
|
Current |
51 |
40 |
|
Total lease liabilities |
451 |
478 |
|
Summary of lease liabilities by period of redemption: |
|||
Less than six months |
24 |
19 |
|
Six to 12 months |
27 |
21 |
|
Between one and two years |
62 |
51 |
|
Between two and three years |
76 |
62 |
|
Between three and four years |
81 |
66 |
|
Between four and five years |
98 |
81 |
|
Over five years |
83 |
178 |
|
Total lease liabilities |
451 |
478 |
|
Analysis of movement in lease liabilities |
|||
At beginning of the year |
478 |
504 |
|
New leases |
2 |
|
|
Lease terminations |
|
(3) |
|
Lease remeasurement adjustments |
12 |
10 |
|
Interest not paid (accrued) |
|
1 |
|
Capital repayments |
(41) |
(34) |
|
– Lease payments |
(89) |
(83) |
|
– Interest charges |
48 |
49 |
|
At end of the year |
451 |
478 |
|
The lease liabilities relate to the right-of-use assets. |
|||
Interest is based on incremental borrowing rates ranging as follows: |