Exxaro Resources Limited – Group and company annual financial statements 2021 | 6.3 Notes to the statements of cash flows relating to operational performance and working capital

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 6:
Operational performance and working capital

6.3 NOTES TO THE STATEMENTS OF CASH FLOWS RELATING TO OPERATIONAL PERFORMANCE AND WORKING CAPITAL

6.3.1 Cash generated by operations

		Group
For the year ended 31 December	Note	2021 Rm	(Re-presented)¹ 2020 Rm
Net operating profit¹		9 677	4 797
– Continuing operations		7 460	4 797
– Discontinued operations	6.1.4	2 217
Non-cash movements:
Depreciation and amortisation	6.1.3	2 677	2 436
Impairment charges of non-current assets¹	8.4	21	1 378
ECLs on financial assets at amortised costs		(57)	(144)
Write-off of trade and other receivables and ESD loans	6.1.3	92	35
Movement in provisions	6.1.3	4	(1 100)
Movement in retirement employee obligation		12	4
Net currency exchange differences		(27)	(8)
Fair value adjustments on financial instruments		(232)	(73)
Net loss on disposal of property, plant and equipment		46	92
Loss on disposal of subsidiaries	8.3	947
Gain on derecognition of financial asset at FVOCI		(175)
Gain on deemed disposal of JV			(1 321)
Gain on disposal of joint operation			(17)
Gain on transfer of operation			(4)
Net gains on disposal of associates	6.1.4	(1 339)
Loss on dilution of investment in associates	6.1.3		20
Movement in indemnification asset			798
Share-based payment expense		246	250
Hedge ineffectiveness on cash flow hedges		10	57
Translation of net investment in foreign operations		(3)	(1)
Translation of foreign currency items		(147)	(12)
Amortisation of transaction costs		5	5
Non-cash recoveries		8	132
Net gains on translation differences recycled to profit or loss on deregistration and liquidation of foreign subsidiaries		(482)	(103)
Net gains on translation differences recycled to profit or loss on disposal of investment in foreign associate		(876)	(13)
Gain on financial instruments revaluations recycled to profit or loss on disposal of associate		(2)
Losses on financial instruments revaluations recycled to profit or loss on deemed disposal of JV			59
Other non-cash movements		2	(8)
Cash before working capital movements		10 407	7 259
Working capital movements
Increase in inventories		(113)	(157)
Decrease in trade and other receivables		266	515
Increase in trade and other payables		40	193
Utilisation of provisions	13.3	(48)	(40)
Cash generated by operations		10 552	7 770

¹	Refer note 19.1.

		Company
For the year ended 31 December	Note	2021 Rm	(Restated)¹ 2020 Rm
Profit before tax		21 123	2 455
– Continuing operations		19 674	1 630
– Discontinued operations		1 449	825
Adjusted for:
Items separately disclosed:
Finance income	12.1.2	(157)	(113)
Finance costs	12.1.2	2 198	2 054
Dividend income from financial assets		(2)	(4)
Non-cash movements:
Dividend revenue from subsidiaries		(8 764)
Depreciation and amortisation	6.1.3	192	148
Gain on remeasurement of associate to fair value less costs of disposal	6.1.4		(756)
Impairment charges of non-current assets	8.4		2 235
ECLs on financial assets at amortised costs		(18)	83
Write-off of trade and other receivables and ESD loans	6.1.3	91	10
Movement in provisions	6.1.3	(1)	(3)
Net currency exchange differences			45
Fair value adjustments on financial instruments		(4)	2
Net loss on disposal of property, plant and equipment		25	14
Net gains on divestment of subsidiaries		(2)	(121)
Net gains on disposal of associates	6.1.4	(1 449)
Share-based payment expense		155	150
Amortisation of transaction costs		5	5
Cash before working capital movements		13 392	6 204
Working capital movements
Decrease/(increase) in inventories		2	(4)
Decrease/(increase) in trade and other receivables		382	(43)
Decrease/(increase) in treasury facilities with subsidiaries (receivable)		771	(848)
Increased in non-interest-bearing loans from subsidiaries		168	220
Decrease in trade and other payables		(13)	(3)
Increase in treasury facilities with subsidiaries at amortised cost (payable)		1 815	1 952
Cash generated by operations		16 517	7 478

¹	Refer note 19.2.

CHAPTER 6: Operational performance and working capital

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CHAPTER 6:
Operational performance and working capital