Exxaro Resources Limited – Group and company annual financial statements 2021

CHAPTERS 1 TO 3

CHAPTERS 1 TO 3

CHAPTER 1

The year in brief

CHAPTER 2

Responsibility statement on internal financial controls Certificate by the group company secretary Report of the directors Audit committee report Independent auditor's report

CHAPTER 3

Accounting policy relating to segmental reporting Significant judgements and assumptions made by management in applying the related accounting policy Reportable segments Geographic location of segment assets

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.

We're building on an existing successful platform leveraging our skills and differentiation with a long-term vision to develop a sustainable, growth-orientated, value-driven company, a leading international renewable solutions provider by the end of the decade.
CHAPTERS 4 TO 5

CHAPTERS 4 TO 5

CHAPTER 4

Statement of comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Company statement of comprehensive income Company statement of financial position Company statement of changes in equity Company statement of cash flows

CHAPTER 5

Accounting policy relating to earnings Attributable earnings per share Reconciliation of headline earnings Headline earnings per share Dividend distributions Notes to the statements of cash flows relating to earnings

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.
CHAPTERS 6 TO 7

CHAPTERS 6 TO 7

CHAPTER 6

Operational performance Working capital Notes to the statements of cash flows relating to operational performance and working capital

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.

We're building on an existing successful platform leveraging our skills and differentiation with a long-term vision to develop a sustainable, growth-orientated, value-driven company, a leading international renewable solutions provider by the end of the decade.

CHAPTER 7

Accounting policies relating to taxation Significant judgements and assumptions made by management in applying the related accounting policies Income tax (expense)/benefit Reconciliation of tax rates Deferred tax Notes to the statements of cash flows relating to taxation Tax effect of other comprehensive income
CHAPTERS 8 TO 9

CHAPTERS 8 TO 9

CHAPTER 8

Accounting policies relating to business environment and portfolio changes Significant judgements and assumptions made by management in applying the related accounting policies Divestment of non-core assets Impairment charges of non-current assets Non-current assets and liabilities held-for-sale

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.

CHAPTER 9

Accounting policies relating to investments in associates and joint arrangements Significant judgements and assumptions made by management in applying the related accounting policies Income from investments in associates and joint ventures Investments in associates and joint arrangements Movement analysis of investments in associates and joint ventures Summarised financial information of associates and joint ventures Reconciliation of carrying amounts of investments in associates and joint ventures
CHAPTERS 10 TO 13

CHAPTERS 10 TO 13

CHAPTER 10

Property, plant and equipment Intangible assets Financial assets Other assets

CHAPTER 11

Accounting policies relating to leases Judgements and assumptions made by management in applying the related accounting policies Right-of-use assets Lease liabilities

CHAPTER 12

Debt Equity

CHAPTER 13

Accounting policies relating to provisions and contingencies Significant judgements and assumptions made by management in applying the related accounting policies Provisions Contingent liabilities and contingent assets
CHAPTERS 14 TO 16

CHAPTERS 14 TO 16

CHAPTER 14

Accounting policies relating to employee benefits Significant judgements and assumptions made by management in applying the related accounting policies Employee benefits Retirement employee obligations Directors' and prescribed officers' remuneration

We're building on an existing successful platform leveraging our skills and differentiation with a long-term vision to develop a sustainable, growth-orientated, value-driven company, a leading international renewable solutions provider by the end of the decade.

CHAPTER 15

Related-party transactions

CHAPTER 16

Accounting policies relating to financial instruments Judgements and assumptions made by management in applying the related accounting policies Financial instruments
CHAPTERS 16 TO 17

CHAPTERS 16 TO 17

CHAPTER 16

Accounting policies relating to financial instruments Judgements and assumptions made by management in applying the related accounting policies Financial instruments

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.

We're building on an existing successful platform leveraging our skills and differentiation with a long-term vision to develop a sustainable, growth-orientated, value-driven company, a leading international renewable solutions provider by the end of the decade.

CHAPTER 17

Accounting policies relating to subsidiaries Significant judgements and assumptions made by management in applying the related accounting policies Transactions with subsidiaries Summary of investments in subsidiaries Summary of indebtedness by/(to) subsidiaries Detailed analysis of investments in subsidiaries and indebtedness by/(to) subsidiaries Non-controlling interests
CHAPTERS 18 TO 20

CHAPTERS 18 TO 20

CHAPTER 18

Basis of preparation Adoption of new, amended and revised standards and interpretations Events after the reporting period

CHAPTER 19

Re-presentation of group comparative information Restatement of company comparative information

CHAPTER 20

Annexure 1: Shareholder analysis Annexure 2: Definitions Annexure 3: Administration Annexure 4: Shareholders' diary

TRANSITIONING TO SUSTAINABLE GROWTH AND IMPACT

In this strategy-focused chapter, we outline how our business leadership has transitioned as well as our strategy. As we commence the implementation of the strategy, we outline the drivers for our strategic direction, how we will measure our success into the future as well as reflecting on our past strategic performance.
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CHAPTER 10:
Assets

10.3FINANCIAL ASSETS

10.3.1 Accounting policies relating to financial assets

The accounting policy for financial assets is disclosed in note 16.1 of financial instruments.

10.3.2 Financial assets composition

		Group		Company
At 31 December	Note	2021 Rm	2020 Rm	2021 Rm	2020 Rm
Non-current
Financial assets at FVOCI		446	222
Equity: unlisted – Chifeng¹		446	222
Financial assets at FVPL		2 173	1 247	34	30
Debt: unlisted - environmental rehabilitation funds		2 173	1 247	34	30
Financial assets at amortised cost		618	672	5 225	1 376
ESD loans²		91	79	91	79
Vendor finance loan³		293		293
Interest-bearing loans to subsidiaries⁴	17.5			4 841	1 297
Other financial assets at amortised cost		234	593
– Environmental rehabilitation funds		94	386
– Deferred pricing receivable⁵		145	212
– Impairment allowances		(5)	(5)


Total non-current financial assets	16.3	3 237	2 141	5 259	1 406
Current
Financial assets at FVPL		4
Derivative financial assets		4
Financial assets at amortised cost		307	169	6 260	11 386
ESD loans²		90	105	90	105
Vendor finance loan³		7		7
Interest-bearing loans to subsidiaries⁴	17.5			858	6 041
Non-interest-bearing loans to subsidiaries⁶	17.5			357	353
Treasury facilities with subsidiaries⁷	17.5			4 803	4 887
Other financial assets at amortised cost		210	64	145
– Deferred pricing receivable⁵		67	64
– Deferred consideration receivable⁸		150	1	150
– Employee receivables		4	4	4	4
– Impairment allowances		(11)	(5)	(9)	(4)


Total current financial assets	16.3	311	169	6 260	11 386
Total financial assets		3 548	2 310	11 519	12 792

¹	During the year the four Chifeng refinery companies embarked on a process to consolidate the separate companies into one consolidated entity. The investments in the separate companies for certain of the phases were derecognised and the investment in the consolidated entity which includes all phases of the Chifeng refinery, was recognised on the consolidation date. Exxaro now holds an 8.81% shareholding in Chifeng.
²	Interest-free loans advanced to successful applicants in terms of the Exxaro ESD programme.
³	Vendor finance loan granted to Overlooked Colliery as part of the disposal of the ECC operation. The loan is unsecured, repayable from 2026 and bears interest at: – Prime Rate for the period 3 September 2021 to 31 August 2028 – Prime Rate plus 1 for the period 1 September 2028 to 31 August 2029 – Prime Rate plus 2 for the period 1 September 2029 to 31 August 2030 – Prime Rate plus 3 for the period 1 September 2030 to 31 August 2031.
⁴	Includes back-to-back loans as well as other interest-bearing loans. Refer note 17.5 for details of the terms and conditions.
⁵	Relates to a deferred pricing adjustment which arose during 2017. The amount receivable will be settled over seven years (ending 2024) and bears interest at Prime Rate less 2%.
⁶	These loans are interest-free, unsecured and repayable on demand.
⁷	Treasury facilities with subsidiaries have no repayments terms and are repayable on demand. Interest is charged at money market rates.
⁸	2021: Relates to deferred consideration receivable which arose on the disposal of the ECC operation. 2020: Relates to deferred consideration receivable which arose on the disposal of mineral properties.

CHAPTER 10: Assets

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CHAPTER 10:
Assets