Annual Report 2013 - CIEL Group · Alteo Limited - ANNUAL REPORT 2013 page 3 page 2 Alteo Limited - ANNUAL REPORT 2013 NOTICE OF ANNUAL MEETING TO SHAREHOLDERS Notice is hereby given

Annual Report 2013

Alteo Limited - ANNUAL REPORT 2013

CONTENTSNotice of Annual MeetingCorporate InformationGroup StructureChairman’s StatementExecutives’ ReportCorporate Social Responsibility Corporate GovernanceOther Statutory DisclosuresCompany Secretary’s Certificate

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Independent Auditors’ Report to the MembersStatements of Financial PositionIncome StatementsStatements of Comprehensive IncomeStatements of Changes in EquityStatements of Cash FlowsNotes to the Financial StatementsProxy FormPostal Vote

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DEAR SHAREHOLDER,

ThE BOARd Of diRECTORS Of ALTEO LimiTEd iS PLEASEd TO PRESENT iTS ANNUAL REPORT fOR ThE yEAR ENdEd JUNE 30, 2013. ThiS REPORT wAS APPROvEd By ThE BOARd Of diRECTORS AT A mEETiNg hELd ON SEPTEmBER 20, 2013.

ON BEhALf Of ThE BOARd Of diRECTORS Of ALTEO LimiTEd, wE iNviTE yOU TO gO ThROUgh ThE ANNUAL REPORT ANd JOiN US AT ThE ANNUAL mEETiNg Of ThE COmPANy whiCh wiLL BE hELd:

DATE: wEdNESdAy, dECEmBER 18, 2013TIME: 10.00 hOURSPLACE: hENNESSy PARK hOTEL EBONy CONfERENCE ROOm 65 EBÈNE, EBÈNE CyBERCiTy

wE LOOK fORwARd TO SEEiNg yOU.

yOURS SiNCERELy,

ARNAUd LAgESSE CHAIRMAN


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NOTICE OF ANNUAL MEETINGTO SHAREHOLDERSNotice is hereby given that the Annual Meeting (“the Meeting”) of Shareholders of Alteo Limited (“the Company”) will be held at Hennessy Park Hotel, Ebony Conference Room, 65 Ebène Cybercity, Ebène on Wednesday, December 18, 2013 at 10.00 hours to transact the following business in the manner required for the passing of ORDINARY RESOLUTIONS:

AGENDA1. To consider the Annual Report 2013 of the Company.

2. To receive the report of BDO & Co, the auditors of the Company.

3. To consider and adopt the Group’s and Company’s audited financial statements for the year ended June 30, 2013.

4. To re-elect, on the recommendation of the Corporate Governance Committee, as Director of the Company to hold office until the next Annual Meeting, in accordance with Section 138(6) of the Companies Act 2001, Mr. G. Christian Dalais1 who offers himself for re-election.

5-13. To re-elect, on the recommendation of the Corporate Governance Committee, as Directors of the Company to hold office until the next Annual Meeting, the following persons1 who offer themselves for re-election (as separate resolutions):

5. Mr. Arnaud Lagesse

6. Mr. Jean-Claude Béga

7. Mr. Jan Boullé

8. Mr. Patrick de L. d’Arifat

9. Mr. P. Arnaud Dalais

10. Mr. Amédée Darga

11. Mr. Jean de Fondaumière

12. Mr. Louis Guimbeau

13. Mr. Thierry Lagesse

14. To re-appoint BDO & Co as auditors for the ensuing year and to authorise the Board of Directors to fix their remuneration.

15. To ratify the remuneration paid to the auditors for the financial year ended June 30, 2013.

By Order of the Board

Nathalie Gallet, ACISFor Navitas Corporate Services LtdCompany Secretary

November 12, 2013

Notes

1. A shareholder of the Company entitled to attend and vote at this meeting may appoint a proxy of his/her own choice to attend and vote on his/her behalf. A proxy need not be a member of the Company.

2. A proxy form and a postal vote are included in this Annual Report and are also available at the registered office of the Company.

3. The instrument appointing a proxy or any general power of attorney shall be deposited at the Share Registry and Transfer Office of the Company, MCB Registry & Securities Ltd, 2nd Floor, MCB Centre, 9-11, Sir William Newton Street, Port-Louis, not less than twenty-four (24) hours before the start of the meeting and in default, the instrument of proxy shall not be treated as valid.

4. Postal votes shall be deposited at the Share Registry and Transfer Office of the Company, MCB Registry & Securities Ltd, 2nd Floor, MCB Centre, 9-11, Sir William Newton Street, Port-Louis, not less than forty-eight (48) hours before the start of the meeting and in default, the postal vote shall not be treated as valid.

5. For the purpose of this Annual Meeting, the Directors have resolved, in compliance with Section 120(3) of the Companies Act 2001, that the shareholders who are entitled to receive notice of the meeting shall be those shareholders whose names are registered in the share register of the Company as at November 20, 2013.

6. The minutes of the Annual Meeting held on December 18, 2012 are available for consultation by the shareholders during office hours at the registered office of the Company, Vivéa Business Park, Saint Pierre.

7. The minutes of the Annual Meeting to be held on December 18, 2013 will be available for consultation and comments during office hours at the registered office of the Company, Vivéa Business Park, Saint Pierre from February 3 to 14, 2014.

Footnote 1: The profiles and categories of the Directors proposed for re-election are set out at pages 50 to 53 of the Annual Report 2013.


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MANAGEMENT TEAM

P. Arnaud Dalais – Group Chief Executive

Patrick de L. d’Arifat – Chief Executive Officer

Jérôme De Chasteauneuf – Head of Finance

Robert Baissac – CEO of TPC Ltd

Jean-Luc Harel – COO Sugar Milling & Energy Activities

Sébastien Lavoipierre – Designate COO Sugar Milling & Energy Activities

Christian Marot – COO Agricultural Activities

Jean-Robert Lincoln – Group Agricultural Development Executive

Patrice Legris – CEO of Alteo Properties Ltd

REGISTERED OFFICE

Vivéa Business ParkSaint PierreMauritiusBRN: C06000012Tel: +230 402 9050Fax: +230 432 0729Website: www.alteogroup.com

ALTEO - BEAU CHAMP

Beau ChampGrand River South EastMauritiusTel: +230 417 6000Fax: +230 417 6481

ALTEO - UNION FLACQ

Union FlacqMauritiusTel: +230 402 3300Fax: +230 413 2699

COMPANY SECRETARY

Navitas Corporate Services Ltd 2nd Floor, Navitas Business Centre13, St Clément StreetCurepipeMauritius

SHARE REGISTRY & TRANSFER OFFICE

If you are a shareholder and have inquiries regarding your account, wish to change your name or address, or have questions about lost share certificates, share transfers or dividends, please contact our Share Registry and Transfer Office:

MCB Registry & Securities Limited2nd Floor, MCB Centre9-11, Sir William Newton StreetPort-LouisMauritiusTel: +230 202 5397Fax: +230 208 1167

EXTERNAL AUDITORS

BDO & Co.

INTERNAL AUDITORS

EY

BANKERS

ABC Banking Corporation

AfrAsia Bank Limited

Barclays Bank PLC

Bank of Baroda

Banque des Mascareignes Ltée

Bank One Limited

State Bank of Mauritius Ltd

The Hong Kong and Shanghai Banking Corporation Ltd

The Mauritius Commercial Bank Ltd

CORPORATEINFORMATION

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World Tropicals Ltd

Sukari Investment Company Limited

Microlab Ltd

TPC Ltd

100%

100%

61%

100%

50%

67.55%

75%

100%

100%

33.33%

Flagstone Property Management Ltd

Anahita World Class Sanctuary Ltd

Trois Ilots Limited

99.89%

100%

100%

Trianon Estates Limited

Société Gonin

Société Ducomet

50.01%Noveprim Limited

93% NoveprimEurope Limited

80% Deep River Beau Champ Milling Company Ltd

80% Contance La Gaiété Milling Company Limited

100% Anahita Centre for Excellence Limited

37.5%Bluefrog Limited

32.5%

39%

50.63%

32.5%

13.13%

Alteo Refinery Ltd (formerly FUEL Refinery Limited)

Alteo Planters Services Ltd(formerly FSMC Planters Services Co Ltd)

Anahita Golf Ltd

Compagnie Usinière de Mon Loisir Ltée

Consolidated Energy Co. Ltd.

50%

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GROUPSTRUCTUREAS AT SEPTEMBER 20, 2013

DEEP RIvER INvESTMENT LTD20.96%

GML INvESTISSEMENT LTéE26.92%

OTHER SHAREHOLDERS 52.12%

ALTEO LIMITED

50%

64.23%

61.72%

65.19%

100%

60%

50%

100%

50%

33.3%

100%

65.10%

65.10%

85.72%

100%

100%

99.99%

57.15%

Anahita Estates Limited

Anahita Hotel Limited

Fondation Nouveau Regard

Commercial and Industrial Enterprises Ltd

100%

50%

6.99%

99.99%

Anahita Residences and villas Limited

Constance La Gaiété Company Limited

Ferney Aquaculture Limited

Société Beaureagrd

Novelife Limited

Alteo Energy Ltd(formerly F.U.E.L. Steam and Power

Generation Company Limited)

Refinest Limited

Alteo Milling Ltd(formerly F.U.E.L. Sugar Milling

Company Limited)

Eastern Energy Company Limited

Compagnie de la vigie Limitée

Usinest Limited

Schoenfeld Co. Ltd

Alteo Properties Ltd (formerly CIEL Properties Ltd)

Island Fresh Ltd

Sucrière des Mascareignes Limited

West East Limited

CIEL et Nature Limitée

Sena Development Ltd

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CHAIRMAN’SSTATEMENT

Associated companies and Joint Ventures contributed Rs 104m (2012: loss Rs 2,4m) mainly resulting from an exceptional revenue by one of the entities.

Following the amalgamation, the Board of Directors decided to align the discount rate applied to third party freehold land valuation throughout the Group. This is largely responsible for the surplus on revaluation of land of Rs 1,368bn stated in the other comprehensive income.

An interim dividend of Rs 0.30 per share based on 318,492,120 ordinary shares (2012: Rs 4.00 based on 9,360,000 ordinary and preference shares) and a final dividend of Rs 0.45 per share (2012: Rs 0.40 based on 186,986,700 ordinary shares) were declared during the financial year under review.

During the year, the Company raised Rs 1bn through the first tranche of a multicurrency note programme at an average cost of funds of 5.40% per year. The proceeds from this issue will be used to refinance existing short term banking facilities and also to fund our obligations in respect of the voluntary retirement scheme.

PROSPECTS

Sugar and Energy

In Mauritius, an average overall sugar crop is expected, which should yield fair results provided export prices to EU are not too adversely affected by the depressed world market. Energy results are likely to remain in line with the previous years on the basis of foreseeable sluggish coal prices.

In the sugar sector, ALTEO is looking forward to start reaping the synergic benefits of the amalgamation in the agricultural activities through a more efficient utilization of resources and in the industrial sector through the closing down of Deep River Beau Champ mill and the concentration of the operations onto Alteo Milling.

In the aftermath of the milling centralization, Alteo Energy will be in an ideal position to maximize its renewable energy potential in the context of any request for proposals from the authorities. In Tanzania, a very good crop is anticipated against more difficult market conditions. The initial investments in the new Business Plan, both at field and factory levels, will be initiated and should have an effect on operational efficiency and production levels.

Property

The sector remains challenging. However, the recent improved trend is expected to gain momentum towards the end of the year with the expected launch of our new product offering, Amalthea, at Anahita. Alteo will also be embarking, with the assistance of external expertise, in a thorough exercise with a view to determining and optimizing the best opportunities for value creation in its significant property portfolio.

Hospitality

The improved trend noted in our activities is expected to consolidate further in the year to come.

Regional Development

ALTEO is looking forward to completing during the year the in-depth studies with regard to the integrated sugar and energy project in Swaziland for which we have recently signed a Memorandum of Understanding. Other projects are also being investigated. ALTEO will, in parallel, further investigate other regional opportunities that have already been identified and that present interesting opportunities for the Company to become a major sugar and energy production in the region.

Social responsibility

ALTEO was very active during this financial year on the social and environmental fronts and contributed to Rs 4.7m to a number of socio-economic development, education, and training, childcare and health projects. Going forward, ALTEO will continue to fulfill the various commitments of ex DRBC as well as those of ex FUEL through, Fondation Nouveau Regard and GML Fondation Joseph Lagesse, respectively, as well as contributing directly to a number of other initiatives.

Appreciation

I would like to express my gratitude to my colleagues of the Board of Directors for their assistance and guidance throughout the year and the management and staff under the leadership of Arnaud Dalais, Group Chief Executive, and of Patrick d’Arifat, Chief Executive Officer, for their valuable contribution during the year.

Arnaud LagesseChairman

September 20, 2013

Dear Shareholder,

July 2012 marked the history of the sugar industry in Mauritius, with the creation of Alteo Ltd (“ALTEO”)further to the amalgamation of FUEL with and into DRBC.

Derived from the Latin word “Altus”, the name Alteo encompasses the vision of the new Group - To reach new heights through its plans of local and international expansion by leveraging on the expertise of employees and combining resources to sustain competitiveness. This vision resulted from the shared objective of its main shareholders, Deep River Investment and GML Investissement, and their dedicated leadership, to ensure the competitiveness of their existing operations in an increasingly liberalized environment, whilst open the way to a number of new exciting avenues.

The setting up of ALTEO and its listing on the Official Market of the Stock Exchange of Mauritius since July 31, 2013 designated the starting points of a new era of tremendous opportunities for the Group which aims to be a regional leader, not only in the cane industry, but across a business mix that spans renewable energy production, sustainable property development and the leisure and hospitality industries.

The present annual report and financial statements for the period ending June 30, 2013, thus constitutes the first such report and statements of the amalgamated entities.

As the amalgamation took place in July 2012, the comparative figures of the Company and Group for the year ended June 2012, as contained in the present financial statements are those of ex-DRBC and its subsidiaries only.

OVERALL REVIEW

The overall financial performance of the Group for its first year of existence has been more than encouraging as more fully described hereunder.

On the organizational side, the main initiatives for the year have been, namely, the setting up of the Company’s Head Office at Vivéa Business Park, St Pierre, where the property development cluster is also based; and, the refurbishment of the Union Flacq offices where the greater part of the agricultural and industrial staff have now been relocated.

On the operational and strategic plan, the year has seen the following main features:

i) The completion of the investment programme at Alteo Milling Ltd and Alteo Energy Ltd to optimize

the capacity and operational efficiencies of these two plants, in view of the forthcoming closure of DRBC Milling factory and the redirection of the canes to Alteo Milling Ltd.

ii) The initial reorganization of the agricultural operations with a view to ensuring that all the potential synergies of the amalgamation materialize over the coming years.

iii) The setting up of a structured financial and technical project appraisal team so as to reinforce the Company’s capacity to identify new investment ventures.

iv) The production of a new 5 year Business Plan for TPC Ltd in Tanzania that identifies the investments required at both agricultural and industrial levels to bring the yearly sugar production to some 110,000 tonnes.

v) On the property front, at Anahita, the finalization of all the preparatory works for the launching, by the end of 2013, of Amalthea, a new phase of 59 units comprising villas, duplexes and golf lodges.

FINANCIAL RESULTS

The Group turnover for the year stood at Rs 6,066m (2012: Rs 3,673m) with an operating profit of Rs 1,908m (2012: Rs 1,401m) and a profit after tax of Rs 1,407m (2012: Rs 700m). This much improved performance is attributable to the following main elements; (i) the amalgamation of FUEL entities; (ii) better operational performances; (iii) profit on disposal of assets and (iv) a gain on fair value of investment property.

Our sugar operations in Tanzania continued to perform very satisfactorily despite a slightly lower production of 87,000 tonnes for the year, (2011-2012: 91,000 tonnes). Mauritian operations also reported an improved performance as a result of a globally average crop and sugar prices at Rs 17,560 per tonne, i.e. 10 % higher than in the previous year. Energy activities in Mauritius also recorded fair results in the face of sustained off take from the national grid (166 GWh) and lower coal costs. The refinery operation also improved its performance with a production of some 163,000 tonnes and higher operational efficiencies.

Our activities in the hospitality industry continued to show improved results despite the still difficult market conditions. The property sector remained tough but encouraging signs were seen at the end of the financial year which leads us to believe that a possible recovery is under way.


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EXECUTIvES’REPORT

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EXECUTIvES’ REPORT

We are pleased to submit our first executives’report following the merger, in July 2012 of FUEL with and into Deep River Beau Champ Ltd, and which has subsequently been renamed Alteo Limited (“ALTEO”).

Following the merger, the ordinary shares of ALTEO were listed on the Official Market of the Stock Exchange of Mauritius on July 31, 2012.

The year under review has been an exciting one following this successful merger and challenges were numerous. We would like to put on record the excellent performance of the company and the group in their first year of operation. This has been achieved thanks to the good work done by each and every one amongst our management and staff, both locally and abroad. A special tribute to Jean Luc Harel, COO for Industrial activities, and Christian Marot, COO for Growing activities and Logistics, who through their close collaboration, have permitted a very good integration of both teams from ex-FUEL and ex-DRBC into one at the level of ALTEO.

This has also been the case at both head office level and finance and accounts departments where a dedicated team, under the leadership of Jérôme de Chasteauneuf, Head of Finance, have successfully integrated all the systems to allow our operations to run smoothly.

The creation of ALTEO has not only led to significant added impetus to the operations but has also resulted in an excellent financial performance as spelt out hereunder.

The group has recorded a turnover in excess of Rs 6,066m (2012: Rs 3,673m) for the financial year resulting in a profit after tax of Rs 1,407m (2012: Rs 700m). These figures are however not comparable with those of last year which were “pre- merger”.

Sugar and sugar related activities, from both local and regional levels, have generated a turnover of Rs 4,267m, whilst power generation recorded a turnover Rs 1,192m, property development Rs 206m and others Rs 399m for the financial year under review.

Other operating income which includes agricultural diversification, rent & transport recharge, profit on sale of land amongst others stood at Rs 247m.

The operating profit after accounting for the direct expenses and overheads for the Group reached Rs 1,908m compared to Rs 1,401m in the previous year.

The adoption of a uniform discount rate resulted in a fair value gain on investment property for the year of Rs 109m (2012: nil).

Finance cost on interests bearing debts stood at Rs 323m (2012: Rs190m). During the year, as stated in the Chairman’s Statement, Alteo Limited, the Company, raised Rs 1 billion through the issue of multi-currency notes programme. The interest rates on these notes range between 4.10% and 5.75% with repayment terms of 1 to 5 years. The purpose of this fund raising exercise was to refinance existing short term banking facilities and also to fund our obligation regarding the voluntary retirement scheme.

Our share of results of associated companies and Joint ventures stood at Rs 104m (2012: Rs 2m). This is largely as a result of exceptional revenue recorded in one of the companies.

The profit realized at Group level on disposal of land and investment property reached Rs 62m (2012: nil). A gain of Rs 47m (2012: nil) on re-measuring our interest from associate to subsidiary was registered in the year under review.

Alteo Ltd undertook a revaluation of its land assets and investment portfolio and realised a gain on its land of Rs 1,335m, excluding Investment Property, treated separately, and a gain of Rs 537m on its portfolio of investments. In line with prevailing accounting standards, such gains are disclosed in the Statements of Comprehensive Income.

We are pleased to present herewith an extensive review of the different lines of activity where the Group operates, namely:

i) Cane Growing

ii) Sugar Manufacturing

iii) Sugar Refining

iv) Energy

v) Regional Development – TPC Limited (cane growing, milling and energy)

vi) Property & Hospitality

ALTEO AGRI

ALTEO SUGARS

ALTEO ENERGY

ALTEO INTERNATIONAL

ALTEO PROPERTY & HOSPITALITY

CANE GROWING

SUGAR MANUFACTURING

SUGAR REFINING

ENERGY

REGIONAL DEVELOPMENT – TPC LIMITED

(CANE GROWING, MILLING AND ENERGY)

PROPERTY DEVELOPMENT & TOURISM


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The deviations from budgeted cane productivity were an increase of 4.9% for Union Flacq (UF), a drop of 4.0% for Beau Champ (BC) and 9.3% for Mon Loisir (ML). The reduction in the yield at BC and ML, where most of the cane areas are situated in the humid and sub-humid regions, was attributable to low rainfall. A deficit of rainfall of 47% in the North and 21% in the East was registered during the period of October 2011 to February 2012 compared to the Long Term Mean. This shortfall of rainfall in the East was beneficial to the super humid regions of Bel Etang and Sans Souci where a gain in productivity of nearly 9 tonnes cane/ha was recorded representing an increase of 12% over the initial estimate.

CANE GROWING

Review of Operations

ALTEO

2012 Crop

Crop 2012 marked the first harvest of ALTEO. The total area under cane cultivation after the amalgamation of Flacq United Estates Ltd, Deep River–Beau Champ Ltd and the subsequent dissolution of Société de Gérance Mon Loisir Ltd reached an extent of 11,260 ha located in the regions of Olivia, Belle-Rive, Ferney, Queen Victoria, Bel Etang and Mon Loisir. During the 2012 crop, 10,000 ha were harvested for a total cane production of 807,645 tonnes, in line with the estimated figure of 808,240 tonnes.

The precipitations in the North and the East are illustrated by Graphs below.

Rainfall in the North from October 2012 to July 2013 v/s Long Term Mean (source MSIRI)

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EXECUTIvES’ REPORTCANE GROWING

Rainfall in the East from October 2012 to July 2013 v/s Long Term Mean (source MSIRI)

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Table 1 below gives an overview on the tonnage of cane production for crop 2012 at ALTEO.

RegionsArea (hectares) Cane Production (tonnes) Yield (tonne/hectare)

Estimate Actual Estimate Actual Estimate Actual

Beau Champ

Olivia 1,229 1,220 103,500 100,131 87.2 82.0

Belle Rive 1,413 1,409 109,500 105,115 77.5 74.6

Ferney 837 839 67,000 64,031 80.0 76.3

Union Flacq

Q. Victoria 2,896 2,896 245,000 248,561 84.6 85.8

Bel Etang 1,954 1,936 146,000 161,744 74.7 83.5

Mon Loisir Mon Loisir 1,770 1,778 137,240 128,063 77.5 72.0

TOTAL 10,099 10,077 808,240 807,645 80.0 80.1

In addition, an extent of 1,229 ha was replanted during the year, representing 11% of the total cane area of ALTEO. The total area replanted includes 250 ha under the variety M695/69 which was replaced due the drastic yield drop registered year after year since 2010.

2012/2013 Financial Results

Following the merger of FUEL and DRBC in July 2012 and the subsequent dissolution of Société Gérance de Mon Loisir, the financial statements of ALTEO to June 2013 incorporate for the first time the activities of these three operations.

For the year under review the price of sugar reached Rs17,573, up 9.70% from the previous year. The price of molasses stood at Rs 2,235, which is a 12.8% increase over 2011.

Extraction rate (commercial sugar recovered % cane) was 10.45% on average for ALTEO with the lowest results of 10.22% at BC, followed by 10.48% at UF and the highest result obtained at ML with 10.86%.

On the harvesting side, a total of 447,000 tonnes of canes were harvested mechanically at ALTEO, representing approximately 55% of the total harvest. Some 16,400 tonnes of canes belonging to outgrowers were also harvested by ALTEO’s mechanical harvesters. The total area prepared for mechanical harvest at June 2013 reached 6,990 ha, (including 700 ha at Bel Etang presently harvested manually), which represents 62% of the total cane area and 68% of the total average cane production.

During the year under review, the Company invested in the refurbishing of the irrigation pivot at Trois Ilots and of the drip irrigation system at Grand Port on an extent of 125 ha. In addition, 5 infield tractors of 110 hp were replaced by 5 new tractors of 130 hp for mechanical harvesting and for land preparation during the intercrop.

Table 2 shows the trend in prices in recent years.

The selling price of sugar and molasses (2007-2012) in Rs per tonne.

Crop years 2013 (est.) 2012 2011 2010 2009 2008 2007

Sugar 17,000 17,573 16,020 13,536 14,612 17,427 18,620

Molasses 2,000 2,235 1,982 2,689 3,016 2,181 1,361

EXECUTIvES’ REPORTEXECUTIvES’ REPORT

Taking on the assets of ex-FUEL led to a deferred tax credit of Rs 63m for the year under review.

After allowing for the above, the Company realised a Net Profit of Rs 622m for the year.

Additions to Property, Plant and Equipment amounted to Rs 148m for the year.

2013 Crop

Harvest estimate for crop 2013, undertaken in April 2013, based on prevailing climatic conditions as well as cane growth measurements resulted in a crop forecast of 843,000 tonnes compared to 807,645 tonnes for crop 2012. The deficit rainfall recorded from October 2012 to January 2013, was followed by very favorable rains during the mid-January to end of March period. Unfortunately, as from April to June the whole island experienced another prolonged dry spell, well under the Long Term Mean, which slowed down cane growth. This situation will certainly have an adverse effect on our initial estimate. Extraction rate for the 2013 crop has been estimated to be around 10.50% for the different regions.

As a result of the improved sugar and molasses prices, the turnover of the Company reached Rs 1,238m. Other Operating Income also grew by Rs 44m compared to the previous year due to an increase of Rs 13m in management fees receivable, subsidiaries which did perform better, a Rs 13m rise in rental income and a Rs 15m increase in revenue from agricultural diversification.

After taking into account the positive movement on the valuation of the standing crop as at year end, of Rs 111m, the Company achieved a total income of Rs 1,569m for the year.

Given that the cane production achieved was largely comparable to estimates, the cost of production remained on a similar footing as estimated. The Operating Profit for the Company, as reported, was at Rs 267m.

Investment and Other Income was largely within expectations at Rs 415m. The Company registered a gain on the fair value of its Investment Property to the order of Rs 142m. Net finance costs decreased by Rs 13m on accounts of gains in year-end foreign currency translations and savings on finance charges. The Company also impaired the value of an investment in a subsidiary by Rs 20m, during the year.

ALTEO Union Flacq: Cane Growth 2013

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CANE GROWINGCANE GROWING

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EXECUTIvES’ REPORTEXECUTIvES’ REPORT CANE GROWINGCANE GROWING

ALTEO Mon Loisir: Cane Growth 2013

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ALTEO Beau Champ: Cane Growth 2013

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Health and Safety

Health and Safety at work continued to be a priority at ALTEO. Health and Safety committees, comprising of representatives of employees and employer, are held on a regular basis to identify and solve workplace safety health problems. Awareness campaigns, such as first aid at work and driving skills, in line with the Occupational Safety and Health Act, were organised for the employees during the year.

Information Technology

The successful amalgamation of the different IT components, such as the data file and email services as well as its ERP system, stems from ALTEO’s IT strategy which is further pursued with the deployment of a single VoIP PABX system extended seamlessly to all remote sites. Remaining in the pipeline is the extensive replacement of PCs by Thin Clients, and local printers with much fewer centralized multi-function devices, this in view of achieving a more effective management of, and control over, ALTEO’s IT infrastructure.

Poultry-Island Fresh

During the financial year, the broiler chicken growing activities at both Mon Loisir and Mérandon, have given good results, better than the initial forecast. The combined production of both entities reached 2,595 tonnes of live weight chicken compared to the forecast of 2,477 tonnes. The mortality rate was higher on both farms that the budgeted figure but was largely compensated by the average live weight at killing age. Finally the financial results for the same period reached Rs 18m of profit before taxation v/s Rs 150m as initially budgeted.

The upgrading project at Mérandon Farm to double its capacity from 80,000 to 160,000 chickens per flock has been completed as planned. The goal of the upgrading of Mérandon Farm was to accommodate the production of Mon Loisir Farm and thereby allowing the latter to devote its capacity to the production of new breed of boiler chicken which will be marketed by Volailles et Tradition Ltd (VTL), a new venture.

2013/14 Forecasted Financial Results

With respect to the 2013/14 forecast, the Company has estimated the sugar price for crop year 2013 to be at Rs 17,000 per tonne, and that of molasses at Rs 2,000 per tonne. After taking into account the effects of the standing crop valuation movement, the Company expects a total income of Rs 1,445m, a cost of production of Rs 1,332m, giving a profit on cane growing operations in Mauritius of Rs 113m.

Future Prospects

One of main objectives of the merger of DRBC and FUEL agricultural activities within the Alteo Agri cluster is to benefit from economies of scale as well as achieving a better operational efficiency through the optimization and upgrading of the agricultural and transport equipment, the extension of mechanized area, the upgrading of irrigation systems and other appropriate technologies which are only warranted on a large scale.

In line with the above, the following investments have been launched during the year:

i) a GPS guidance system suitable for a better control of the in-field traffic system;

ii) two new Centre Pivots at Mon Loisir for irrigation over an area of 125 ha thus making better use of this system’s efficiency for water use as well as to alleviate the problem of scarcity of water in that region;

iii) four filtercake applicators in replacement of contractual labour;

iv) a new more powerful tractor of 240 hp to be used jointly with the heavy duty equipment, such as disc harrow and portable stone crusher

These investments are aimed at reducing the operational dependency on seasonal and contractual employment.

Cms

Cms

Dates

Dates


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18EXECUTIvES’ REPORTSUGAR MANUFACTURING

SUGAR MANUFACTURING


DEEP RIvER BEAU CHAMP MILLING LIMITED

2012 Crushing Season

2009 2010 2011 2012

Cane crushed during crop (tonnes) 768,953 720,911 678,453 654,463

TCH 234.5 231.6 224.5 222.4

Canes/day (tonnes) 4,867 4,871 4,744 4,777

Purity mixed juice (%) 85.8 85.7 85.2 85.2

Sugar produced (%) 78.285 76.203 69.493 66.874

Extraction (%) 10.181 10.570 10.243 10.218

OTE (%) 86.5 87.6 88.1 89.5

MTE (%) 93.2 91.7 95.9 95.8

OR (%) 85.97 86.33 86.21 85.55

Muscovado (tonnes) 9,316 9,407 10,139 14,153

Demerara (tonnes) 13,573 12,858 15,815 14,635

Other raws (PWS) 55,367 53,889 43,579 38,040

The main features of the crushing season were:

• An important drop in available cane and resulting sugar production. This is mainly due to adverse climatic conditions and partly to a drop in the acreage harvested by outgrowers.

• Minimal variance otherwise in rates and efficiencies.

• An important increase in Muscovado sugars production following additional installed capacity.

Extraction Rate Crop 2010 to 2012

8.00

18/0

6

25/0

6

02/0

7

09/0

7

16/0

7

23/0

7

30/0

7

06/0

8

13/0

8

20/0

8

27/0

8

03/0

9

10/0

9

17/0

9

24/0

9

01/1

0

08/1

0

15/1

0

22/1

0

29/1

0

05/1

1

12/1

1

19/1

1

26/1

1

03/1

2

10/1

2

17/1

2

24/1

2

Week

8.50

9.00

9.50

10.00

10.50

10.1910.25

10.57

Extraction

2012- Extraction (Wkly TD) 2010- Extraction (Wkly TD) 2011- Extraction (Wkly TD)

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EXECUTIvES’ REPORTEXECUTIvES’ REPORT SUGAR MANUFACTURINGSUGAR MANUFACTURING

In view of the closure of Deep River Beau Champ mill, the investment programme for 2012-2013, had been limited to:

(a) the replacement of the “C” Massecuite Reheater which had reached the end of its useful life and

(b) the upgrade of the Waste Water Treatment plant by the addition of a Highly Charged Aerobic Reactor.

Financial Results 2012-2013

Even with a 6% drop in sugar tonnage accruing for crop 2012, turnover increased to Rs.358m (Rs 328m in 2012).

This is largely attributable to an increase in final raw sugar price at Rs 17,593 per tonnes (Rs 16,020 in 2012) and better premiums for Special Sugars. Special sugar production was on the upside to reach production level of 28,729 tonnes (25,993 tonnes in 2012).

ALTEO MILLING LTD (ex FUEL SUGAR MILLING Co LTD)


2009 2010 2011 2012

Cane crushed during crop (tonnes) 902,281 888,033 846,018 848,214

TCH 295 289 285 307

Canes/day (tonnes) 5,897 6,001 6,000 6,575

Purity mixed juice (%) 86.8 86.6 85.9 86.7

Sugar Produced (tonnes) 93,397 93,826 86,036 89,382

Extraction (%) 10.35 10.57 10.16 10.54

OTE (%) 83.38 86.46 87.79 89.25

MTE (%) 89.61 90.97 91.33 93.46

OR (%) 87.63 87.66 87.40 87.96

Special Raw Sugar (tonnes) 11,779 11,573 14,999 14,602

After charging for cost of operations including financial charges and taxation for a total amount of Rs 315m (Rs 305m in 2012), the company realised a net profit of Rs 48m (Rs 40m in 2012)

A dividend of Rs 50m (2012: Rs 35m) representing Rs 2.098 per share (2012: Rs 1.468) was declared during the year under review.

Future Prospects

In line with the already agreed sugar sector reform, it is expected that the DRBC Milling operations will cease after the 2013 harvest.

The cane yard and reception will thereafter remain as a transit station for the factory area small planters.

Cane will be reloaded into large carriers to Alteo Milling Ltd of Union Flacq.


• A stable cane availability considering that yields for the upper region was excellent in 2012.

• A higher throughput in TCH and tonnes per day as part of the incremental capacity requirements of the forthcoming centralisation project.

• Minimal variations in extraction and mill efficiencies which remained above island average.

The 2012-2013 investment programme comprised of:

• a juice rotary screen to replace static DSM,

• steam saving from 400 kg/tonne cane to below 300 kg/tonne cane achieved by the installation of additional evaporation and juice heating vessels,

• two new A centrifugals,

• a new C Massecuite crystalliser.

At the time of writing (September 2013), the factory crushing capacity reached a day peak of 390 TCH and 8,900 tonnes of cane for the day.

Centralisation

In 2012/2013, Alteo Milling Ltd continued its factory expansion and consolidation project started in year 2011-2012, in view of the planned closure of Deep River Beau Champ Milling Co. Ltd (DRBC M) in December 2013.

Thus, during the 2012 crop, two important installations were commissioned successfully, namely:

• the heavy duty pressure feeder on mill no. 7, and

• two cooling tower cells in replacement of the cooling pond.

Extraction from crop 2010 to 2012

10.90

10.70

10.50

10.30

10.10

9.90

9.70

9.50

9.30

9.10

8.90

8.70

8.50

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27

Extraction

Week

Year 2010

Year 2011

Year 2012

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EXECUTIvES’ REPORTEXECUTIvES’ REPORT SUGAR REFININGSUGAR MANUFACTURING

Alteo Planters Services Ltd

Alteo Planters Services operates in partnership with sugar cane planters in order to provide them with cost effective and quality services for sustainable sugar cane production. During the period under review, it was mainly involved in the implementation of the FORIP Programme and Harvest Services, as described below. The handing over of planters’ fields replanted in 2012 was completed and the implementation of the following phase was initiated. The table below summarises the extent replanted by the company in the factory area since the inception of FORIP Programme in 2006.

Harvest of planters’ fields spanned from July 2, to December 5, 2012, that is, 131 days. A total of 47,704 tonnes of cane were harvested over an area of around 800 ha belonging to 445 planters. For a measure of comparison, 34,428 tonnes of canes were harvested for 324 planters in 2011, year during which the service was launched.

The department also provided “à La carte services” to 18 planters for an area of around 70 ha. These services included planting, manual weeding, application of fertilisers and herbicides and trash lining.


The results of the milling activity improved on account of the favourable sugar price for the crop year 2012 of Rs 17,573 per tonne (Last Year: Rs 16,020) coupled with a better extraction rate of 10.30% for the year ended 30 June 2013. As a result turnover increased by Rs 52m to Rs 380m.

Costs of operations were maintained to last year level Rs 363m (2012: Rs 367m). Other Income fell by Rs 33m as the 2012 figure accounted for an exceptional reversal of Blue Print provision of Rs 28m alongside with higher interest income. Finance cost rose by Rs 9.6m as a result of the loan financing in relation to the factory expansion.

The company realised of a profit after tax of Rs 28.8m as compared to Rs 18.4m in 2011-2012.

A dividend of Rs 27m (2012: Rs 40m) representing Rs 1.00 per share (2012: Rs1.50) was declared in June 2013.

Future Prospects

In order to complete the factory expansion, the 2013-2014 investment programme will involve mainly the shredding and juice extraction stations and the transfer of the special sugar plant from DRBC M.

The existing effluent treatment plant at DRBC M will be upgraded to a state of the art facility to treat additional waste waters and will be transferred to Alteo Milling Ltd. At the same time, an effluent abatement programme will be launched.

Extent replanted by Alteo for the FORIP Programme and number of planters concerned

Phase Year Area (ha) No. planters concerned

I 2006/07 120 74

II 2008 242 176

III 2009 184 132

IV 2010 198 149

V 2011 201 238

VI 2012 290 243

VII 20131 192 231

TOTAL 1,428 1,243

Prospects

Reduction of sugar production in Mauritius coupled with an increase of special sugar production will result in a decrease of plantation white sugar available for refining. This will be compensated by the import of sugars from the world market for refining for the non EU, regional and domestic markets. The refinery is at task to make this new avenue a technical and commercial success.

SUGAR REFINING

ALTEO REFINERY LTD (ex FUEL REFINERY LTD)


2010-2011 2011-2012 2012-2013

Originating PWS produced by Alteo Milling Ltd (less recovery) (tonnes)

75,676 70,162 73,880

Originating PWS received from other factories (tonnes) 49,293 80,396 77,217

Non-originating PWS received (tonnes) - 20,650 16,582

White refined sugar exported to EU (tonnes) 125,698 147,208 160,326

White refined sugar for local market (tonnes) 5,316 6,310 2,791

Steam/T sugar (kg) 1.9 1.7 1.1

Electricity/T sugar (kWh) 63 63 62

During the year under review, the refinery reached 96% of its capacity and produced 163,117 tonnes of white sugar for both the export and domestic markets. This represents a 6% increase of production on the previous year. The process has been optimised with a reduction in energy and electricity usage and the target for the coming year will be 170,000 T.

The free flowability of the sugar continued to improve in 2012-2013. The refinery successfully met its Smeta and BRC year audits. The company has successfully been approved in September 2013 as a Coca Cola Supplier for the Africa region.


Turnover for the year rose to EUR 7.6m while operating expenses at EUR 3.2m were lower than the previous year by 19% on account of usage of non-originating sugar available to the refiner and increased efficiency at operational level. Finance Cost amounted to EUR 0.3m (2011-2012: EUR 1m) following repayment of loan instalments and exchange gains recognised during the year.

The Profit after Tax stood at EUR 3.1m for the year ended June 30, 2013 (2011-2012: EUR 1.5m).

1 Provisional figures


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24EXECUTIvES’ REPORTENERGY


With a drop of 6 GWh production of energy exported to the national grid coupled with lower price per kWh received from the Central Electricity Board (CEB), turnover decreased to Rs 327m (Rs 352m in 2012).

On the other hand, coal costs continued its downward trend and reached an average cost of acquisition of Rs 3,420 per tonne (compared to Rs 4,084 in 2012). The rise in operating expenses and financial charges was contained to a 5% increase from Rs 138m to Rs 146m for 2013.

The company thus realised a net profit of Rs 23m, compared to a deficit of Rs 8m for 2012.

CEL declared and paid a dividend of Rs 25m in June 2013.

Future Prospects

The present Power Purchase Agreement (PPA) with the CEB ends in July 2015. Following the closure of Deep River Beau Champ Milling Co. Ltd, the plant will have to operate on coal only but could supply incremental energy normally supplied to the mill during crop season. Amendments to the present PPA are under discussion with the CEB.

ENERGY

CONSOLIDATED ENERGY CO. LIMITED


2010-2011 2011-2012 2012-2013

Bagasse (tonnes) 228,029 199,916 222,647

Coal (tonnes) 24,812 55,990 46,629

Export Bagasse (GWh) 50.6 42.5 50.9

Export Coal (GWh) 31.8 81.6 67.5

Total Exports (GWh) 82.4 124.1 118.4

kWh/Tonne Bagasse 222 212 229

kWh/Tonne Coal 1,280 1,458 1,447

Mill Electricity Consumption (kWh)/Tonne Cane 28 29 29

Mill Steam Consumption (kg)/Tonne Cane 455 453 421


• A higher fibre % cane, thus more bagasse energy.

• A lower total export due to an unplanned stoppage of 18 days to replace the Turbo Alternator condenser tubes.

• A slight improvement in bagasse energy efficiency due to lower internal consumption of steam at the mill.

• During 2012-13 maintenance stop, the following were undertaken: The GTA 3.8 MW control monitoring system has been replaced.

• The TA maintenance involved the four yearly turbine overhaul.

• The TA condenser tubes have been replaced.

• The boiler front wall top bends were replaced.

• A reduction of 17% of the fly ash has been realised with the optimisation of the grit re-firing reinjection with a gain of 9.6% on losses of unburnt in ash.

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EXECUTIvES’ REPORTEXECUTIvES’ REPORT ENERGYENERGY

After accounting for other income, financial costs and taxation, the company realised a net profit of Rs 127m (Rs 78m in 2012).

As a result, the company declared in June 2013 the same dividend as the previous year, i.e. Rs 5.50 per share, amounting to a total of Rs 101m.

Future Prospects

A zero effluent disposal is being implemented for Alteo Energy Ltd with the installation of new cooling towers to have the water cooled in a closed circuit.

Alteo Energy Ltd also made representations to the National Energy Commission on a new power project as summarised hereunder.

Two, phased in, 50 MW 110 Bar coal/biomass plants with the following characteristics:

• Incremental use of cane biomass in using trash left in cane fields.

• Use of other biomass such as Arundo Donax and wood chips from locally grown forest.

• A package of incentives to be proposed to planters supporting the use of renewable sources and limiting coal.

ALTEO ENERGY LTD (ex FUEL STEAM AND POWER GENERATION LTD)


2010-2011 2011-2012 2012-2013

Bagasse (tonnes) 280,099 240,195 250,534

Coal (tonnes) 79,351 83,352 86,313

Export Bagasse (GWh) 55.8 47.7 50.2

Export Coal (GWh) 109.8 110.6 116.6

Total Exports to the grid (GWh) 165.6 158.3 166.8

kWh/Tonne Bagasse 199 198 201

kWh/Tonne Coal 1,383 1,327 1,351

Mill Electricity Consumption (kWh)/Tonne Cane 22.2 21.8 21.4

Mill Steam Consumption (kg)/Tonne Cane 380 380 378


• Higher fibre content in cane with 5% more bagasse energy.

• Higher total export as CEB off-take was higher than the contract minimum.

• Minimal operational efficiency improvements.

During the 2013 maintenance stop, both steam turbines were overhauled by overseas specialists. All machines internals were thoroughly inspected using non destructive testing method to reveal any possible hidden flaws in machine parts. No flaws were detected and both turbines were found fit for operation and the maintenance was in line with the insurer’s recommendations.

2012-2013 Financial Results

The company exported to the grid 6 GWh more than its contractual obligation of 160 GWh towards the Central Electricity Board. Total energy exported to both CEB and Alteo Refinery amounted to 196 GWh (compared to 186 GWh in 2012). This resulted in an increase in turnover from Rs 782m to Rs 827m.

Total cost of sales, operating and administrative expenses amounted to Rs 665m (Rs 694m in 2012). This decrease is largely attributable to the cost of coal which continued its downward trend (Rs 3,646 in 2013 and Rs 4,155 in 2012, per tonne).

PHOTOvOLTAIC PROJECT

In line with its strategy to support the Central Electricity Board’s initiatives and to participate in a greener Mauritius, your Company took part in a tender for Solar Photovoltaic (PV) Farms of Capacity between 1-2 MW.

ALTEO partnered with Astonfield Renewables, a renewable energy group that builds, owns, and operates utility-scale solar power plants in emerging markets with its base of operation in India.

The partnership Astonfield-Ateo was awarded a 2MW Project at Union Flacq on a PV area of 4 hectares.

The Energy Supply and Purchase Agreement (ESPA) is currently being negotiated.


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28EXECUTIvES’ REPORTINTERNATIONAL

possibility of bringing soil salinity to acceptable levels by conducting reclamation work through overhead irrigation.

Sugar Production

The amount of cane crushed per hour for the 2012-13 season, at 162.6 tonnes, was higher than the previous year (158.5) and slightly higher than budget (160.0) mostly due to the pushing of the crushing rate towards the beginning and end of the season to assess if 170 TCH would be achievable on a sustainable basis.

Higher sucrose than past years’ average made up for the slightly lower mill extraction at 95.8%, and boiling house recovery at 83.7%, thus bringing sugar per cent cane to 10.46% compared to 10.45% for the previous season. Factory time efficiency was higher than the previous season but slightly lower than the budget mainly due to mechanical breakdowns, while overall time efficiency was better than budget and the previous season. Finally, although lower than budget by 5.5%, a near record sugar production of 86,086 tonnes was achieved, just below the previous record of the 2011-12 season by 53 tonnes.

Energy Production

Over and above the production of electricity for irrigation and other internal requirements, power export to the national grid amounted for 13.2 GWh by the end of June 2013. This achieved export is lower than the budget due to the combined effects of a shorter crushing season and a lower fibre content of the cane varieties harvested but also to the decision to produce power for an extended period of time for TPC own irrigation requirements against maximizing exports to the grid.

Industrial Relations

Industrial relations continued to be cordial during the course of the year. The annual wage negotiation between the workers’ union, TASIWU and management was successfully conducted and an agreement was signed on the June 5, 2013 granting a salary increase of 10% to the employees on the back of an equivalent inflation rate, year on year to March 2013.

REGIONAL DEVELOPMENT

TPC Limited (“TPC”)

2012/2013 SEASON

Cane Production

During the 2012-13 season a total of 822,796 tonnes of cane were produced from a harvested area of 7,541 ha. This was again a very good cane production for TPC, at levels comparable to the previous year’s record although lower than original estimate by 3.5%. Excellent cane yields of 109 tonnes per hectare for an average cane age at harvest of 11.25 months were achieved, equivalent to an average productivity of 9.7 tonnes per hectare per month; a 2.9% increase over that of the previous season. Such an increased cane production resulted from the continued replacement of old varieties, which accounted for less than 15% of total cane production, as well as from the improvements in cultural practices. Sucrose content averaged 12.92% which saw a slight increase of 0.12 percentage point compared to the figure recorded during the previous season.

The area re-planted during the 2012-13 season amounted to 1,650 ha, mainly with new varieties from South Africa, Mauritius and Reunion Island. A total of 717,953 tonnes of cane and about 73,912 tonnes of sugar were produced from these newly introduced varieties.

The trial to evaluate the performance of drip irrigation in saline and sodic soils has continued to produce promising results with average yields of 186 tonnes per hectare or 16.6 tonnes per hectare per month for the first ratoon. The control portion under surface irrigation yielded 82.5 tonnes per hectare or 7.5 tonnes per hectare per month. The clogging of the emitters experienced during the previous season seems to have been solved during this season. Extensive canal lining works were carried out during the season, concrete lining was used for the main canals and HDPE for the secondary canals totalling this season an additional 2,000 meters of lining; the objective is to increase the volume of water reaching the fields by reducing seepage in canals.

Further to the detailed soil survey carried out on a portion of about 600 hectare of less productive land in the southern part of Kahe area to evaluate if there is a potential for expanding cane production; a 16 hectare portion has been prepared for evaluating the

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2013 Offcrop

The long rains season started in the first week of March. Very good rains were received throughout March, April and early May.

Owing to the good rainy season, major canal lining and pump maintenance works were undertaken without detrimental effect on cane productivity.

On the factory side, a second mill (No. 4) was electrified and an air pre-heater was installed at the boiler. The civil works for the backup TA/Set were also started.

2013/2014 OUTLOOK

Owing to newer cane varieties and better rains during the offcrop, a higher crop, at 898,395 tonnes – a 9% increase compared to last season, has been estimated for the 2013-14 season and sugar production has been budgeted to the level of 95,050 tonnes. The new season started on time on June 11 and is planned to end on March 9.

For the first few weeks of the season cane yields have been more than 16% above budget with an average of 140 tonnes of cane per hectare achieved. These higher yields may be attributed to the combined effects of good rains received during the previous season as well as increased fertilizer application. These productivity gains may however be partly offset by a lower than budgeted sucrose content as noticed during the same period.

Sugar prices and sales volumes in the first 12 weeks of production have been lower than estimated due to unusually high competition with imports in a distorted market. It is expected that prices will remain under pressure in order to achieve the required sales volumes.

During the course of the year, a new business plan covering years 2013-14 to 2017-18 was prepared; it was subsequently approved by the July 2013 Board of Directors Meeting. The plan projects investments in the fields and the factory to increase cane crushing to over 1 million tonnes and sugar production to about 110,000 tonnes per annum by the last year.

Prospects

Building upon its experience, ALTEO has made it one of its major objectives to pursue the expansion of its sugar operations in the region. In that context, a number of opportunities were identified and investigated on the African continent, during the year under review. In particular, ALTEO has been actively engaged in two of the more promising prospects and has, in this context, signed a Memorandum of Understanding in October 2013 for a project in Swaziland. By signing this MoU, ALTEO and the local promoters have agreed on an exclusivity period of six months during which they will together complete the technical and financial assessment of the project.

Sugar and Molasses Sales

The rate of monthly sugar sales for the year was negatively impacted by high levels of imported sugar, some legal and others illegal. As a result, the company only managed to sell all the production just before the start of the new crop which had not been the case in recent years. The lower demand resulted in selling prices coming under pressure with the average price for the year declining by 1.5%. A total of 85,161 tonnes of sugar was sold for the financial year. Although molasses demand for the year was exceptionally strong the 36,690 tonnes sold was lower than the prior year by 2,006 tonnes on the back of reduced production over the financial year. The stronger demand did however result in better prices being achieved with the result that Molasses turnover increased year on year.

Financial Results

Sales in local currency decreased by 4.3% during the year under review; however due to the devaluation of the Tanzanian shilling to the USD, the decrease in USD came to 5.3% with overall sales at USD 70.5m. Cost of Sales increased by 3.1% (increase of 4.2% in local currency) and Other Expenses by 5.6% (increase of 6.7% in local currency). Finance Costs decreased by USD 1.3m mainly as a result of exchange losses incurred on foreign currency positions held in the prior year and not repeating this year; otherwise due to lower interest costs as the outstanding loan was settled in January. The reduction in turnover and increases in costs coupled with a unfavourable valuation impact on Consumable Biological Assets of USD 6.0m resulted in Net Profit before Tax decreasing to USD 37.5m, a USD 10.3m or 21.5% decrease on prior year. With the resultant decrease in profitability, the tax charge was also reduced by USD 3.1m, leaving Net Profit after Tax for the year at USD 26.2m, a decrease of USD 7.2m or 21.6%. This reduction in profitability for the year and similar cash flow impact from investing and financing activities resulted in the year end cash position declining by USD 4.6m. with a net overdraft position of USD2.2m. Total Assets reflected an increase of USD 4.5m largely as a result of increases in the biological assets valuation and investments in fixed assets. On the liability side the Non-Current portion increased by USD 2.2m due to an increase in the deferred tax liability whilst the Trade and Other Payables decreased by USD 1.7m as a result of lower year end accruals.


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32EXECUTIvES’ REPORTPROPERTY & HOSPITALITY

Moreover, the launch of Amalthea, a new phase of 59 units comprising Villas, Duplexes and Golf Lodges, should contribute to broaden Anahita’s product offering, having yielded positive feedback from the market to date. Construction works are expected to begin at the end of 2013. Upon completion of this new phase, more than half of Anahita’s planned properties will be built and operational.

Secondary market transaction values on resale properties still enjoy robust growth momentum, particularly for prime ocean front real estate, resulting in net ROI up to 45%.

Anahita Golf Limited (“AGL”)

Four Seasons Golf Club Mauritius at Anahita (“the golf course”) reaffirmed its position as the golf course of choice in Mauritius for the year ending June 30, 2013.

Showing positive year on year growth in all areas of revenue, the twin resort inclusive golf agreement has consistently proven successful with its unlimited golf component.

With the company’s gross operating profit and net operating income attaining a positive figure this year, there are clear signs that an encouraging future is in store.

Although priority continues to be given to its limited number of lifetime members and resort residents, attracting outside players remains a key strategy. Offering favourable rates to local hotels and groups, along with being open and available to the general public, allows a healthy cross section of market segments to supply the golf course with revenue streams.

The golf course once again will play host to the Afrasia Golf Masters tournament in December 2013. This has proven a solid marketing tool towards the European market and attracts a good number of international guests during this pre-end-of-year period.

PROPERTY DEVELOPMENT AND TOURISM

Anahita Hotel Limited (“AHL”)

Four Seasons is a well-established brand with a solid reputation on the international scene and Four Seasons Resort Mauritius at Anahita remains the leading hotel within the range of 5-star hotels in Mauritius.

Four Seasons Resort Mauritius at Anahita (“Four Seasons Resort”) experienced an overall increase in turnover of 10.7% for FY 2013 as compared to FY 2012.

The resort’s average annual occupancy rate showed a 3-point increase to 63% and the realisation of positive EBITDA of MUR 294.9M represented a net improvement of 17.1% for the hotel, compared to the previous year. The company’s RevPar index registered a score of 95% above average, while its occupancy index was of 16.5% above average, ensuring it remains the leader in its competitive set.

The Resort currently holds the position of sixth Best Hotel in the World, according to Trip Advisor.

Four Seasons Resort forecasts growth in EBITDA and Gross Operating Profit year on year and looks forward to continued growth in all areas during FY 2014.

The private residences at Four Seasons, formerly under Anahita IRS Forty, a separate legal entity, were amalgamated within AHL further to the close to 100% sell through of its forty-five properties. Heretofore, they will remain under full management of Four Seasons Resort. At financial year’s end, three villas remained in the inventory. The resale market of such villas continued to be robust with strong net return on investment of 20% on average being achieved.

Anahita Estates Limited (“AEL”)

The year ending June 2013 marked the beginning of Anahita Mauritius’ seventh year of existence.

Anahita maintains its leading position within the local IRS market. Although very difficult international market conditions prevailed, interest in and sales of its real estate and land products continued to grow.

The product diversification strategy of incorporating serviced residential land for sale triggered signs of positive market absorption with the sale of 5 plots of serviced residential land and a bright forecast for the coming year with 9 additional plots of serviced residential land reserved with deposits.

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EXECUTIvES’ REPORTEXECUTIvES’ REPORT PROPERTY & HOSPITALITY

The marketing focus was to establish an integrated booking engine interfaced with major Online Travel Agencies (OTA) which resulted in increased visibility and higher sales figures (+35%) in this segment.

In an effort to strengthen its positioning, ATR has established an agreement to operate an “Exclusive Beach” at Ile Aux Cerfs. Furthermore, the golf facilities at Ile Aux Cerfs are also included in guests’ packages, thus providing a unique experience on two championship golf courses.

Looking ahead, ATR is showing promising signs of further establishing its position within the east coast local tourism scenery. Reservation levels for the following months until December are indicating that high and peak period occupancy levels should bring in additional revenues.

HORTICULTURE

World Tropicals Ltd

In its endeavor to better focus on its larger sugar operations, following the merger of its operations into ALTEO, the Company decided during the year under review to part from its horticulture operations. At the time of writing, this was being finalized through a management buyout.

Alteo Properties Limited (“APL”) (ex CIEL Properties Ltd)

During the year under review, Alteo Limited consolidated its shareholding in Ciel Properties Ltd from 50% to 100%. Further to that change, the company has now been renamed Alteo Properties Ltd.

In recent years, the company has continued to diversify its revenue stream through a broader client base via its four core strategic activities: asset management, development management, real estate sales and marketing services, and project management.

For the period to June 30, 2013, the promotion and development of Anahita Mauritius remained the main revenue stream of the company which recorded an increase in revenue of 28%, totalling MUR 3.2m, ensuring a strong outlook for Alteo Limited and its subsidiaries.

Anahita Residences and villas Limited (“ARvL”)

Operated by Anahita Residences and Villas Limited (AVRL), Anahita The Resort (ATR) is the administrator of the property rental program at Anahita Mauritius. It manages the resort facilities at La Place Belgath, the lively waterfront village.

With its positioning as a 5-star resort, ATR is well integrated within the Mauritian hotel industry and maintains the esteem and trust of the international travel industry.

Improved performance was realized for FY 2013 through a market diversification strategy during the traditional low-season period and a strong focus on cost monitoring. Efforts were also made to uphold the guest experience with added value services and facilities resulting in the increase of repeat business.

Occupancy was maintained with a positive turnover growth of 6% (MUR 196m). A continued improvement in the bottom line figures with a positive EBITDA of MUR 6m is to be noted.


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EXECUTIvES’ REPORT

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38

Education

FNR believes in and supports alternative education. Thanks to the ANFEN schools network and to the Zippy programme of ICJM, children with learning difficulties can have access to education. FNR provide its support to other NGOs such as Teen Hope of Groupe Noyau Social de Cité La Cure in Port-Louis, Mahebourg Espoir Education Centre (MEEC), l’association Bâtisseurs de Paix, and scholarships to students from Collège St Patrick.

Disability

FNR is also strongly committed to providing disabled children with access to education: thus, in January 2010 it opened the first secondary school for deaf children in collaboration with the NGO Society for the Welfare of the Deaf. In 2010, the Form 1 pre-vocational programme was launched with 20 pupils, then Form II in 2012 and Form III in 2012. In 2013, FNR has renewed its support to the SWD and is financing 25% of the running cost of its 4 classrooms. Moreover, FNR provides its support to other NGOs such as Eastern Welfare Association for the Disabled (‘EWAD’), Association Dominique Savio and Friends in Hope.

Sport

Sport is a unifying factor for gathering young people in pursuit of sound and positive values. That is why this year ALTEO has supported the Curepipe Starlight Sporting Club and the Faucon Flacq Sporting Club.

FNR has also developed a website- www.ACTogether.mu - where numerous NGOs are represented and able to put all their resources together in the fight against poverty and exclusion in Mauritius. This website enables the NGO’s to better communicate among them and to co-organise events such as the workshop of Chlidren’s rights in partnership with SAFIRE and l’Institut Cardinal Jean Margéot and with the collaboration of Mr Trond Waage, and the Marché de Noel Solidaire which aims at promoting the quality of the craft industry and allowing the crafty persons to gain money.

CORPORATE SOCIAL AND ENVIRONMENTAL RESPONSIBILITY

As at June 30, 2012, i.e. prior to the effective date of the amalgamation of FUEL with and into DRBC, the CSR involvement of FUEL and DRBC was mainly channelled through the Fondation Nouveau Regard (“FNR”) of CIEL Group and the GML Fondation Joseph Lagesse (“GML FJL”) respectively. ALTEO was also directly involved and contributed some Rs 900,000 to a number of regional projects and organisation in order to support the development and well-being of children with disabilities, adults with alcoholic dependency problems, technical education, elders in difficulty and sports.

The Fondation Nouveau Regard (“FNR”) - Presentation and Actions

During the year under review, ALTEO has contributed Rs 1.8 million to the Fondation Nouveau Regard, a Special Purpose Vehicle (“SPV”) accredited by the National CSR Committee (“NCSRC”) for various projects managed by local NGOs in areas as:

• Fight against poverty and social integration

• Education

• Disability

• Sport

Fight against Poverty and Social Integration

In line with government policy, the struggle against poverty has been the spearhead of the FNR’s action this year. Thus, at the end of 2010, FNR launched a large-scale integrated community development project in partnership with Caritas: La Caze Lespwar. This project, situated at Solitude, assists communities living in poverty and facing difficulties in the regions of Solitude, Triolet, Plaine des Papayes, Pointe aux Piments, and now reaching even as far as Arsenal. It provides services adapted to the needs of these population groups: education and training, community gardening, breakfast for pupils, sports, holiday activities for children, activities for women, an emergency service, a solidarity shop and a pre-school centre/creativity centre. FNR provide also its support to other NGOs such as the department of ‘counselling’ of the ICJM, the association Kinouété and la Maison cœur écoute of Barkly.

CORPORATESOCIAL RESPONSIBILITY


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EXECUTIvES’ REPORTEXECUTIvES’ REPORTCORPORATESOCIAL RESPONSIBILITY


Community Development

Since its inception GML FJL has established a program of integrated community development in the neighbourhood of Chemin Rail, a small village located in Rivière du Rempart. A whole team of coordinators, social workers, educators and volunteers are working for and are supporting a group of twenty poor families. While aiming to restore their dignity, GML FJL has received the support of ALTEO which has contributed to giving them a better future through the construction of decent houses.

Environment

The focus of GML FJL on education has also an environmental aspect. “GML Think Green” has engaged several projects since last year and some new initiatives are being launched. The specialised ANFEN schools have benefited from the help and expertise of the GML FJL in the implementation of schools garden projects, but also for the conservation of resources and ecosystems. Some other schools have also organised sessions of environmental awareness with Mission Verte supported by GML FJL. For the first time, GML FJL has expanded its activities to Rodrigues through various actions for the protection of native biodiversity of the island, including bats. Moreover, an educational film was realised and produced to accompany the leaders of the Mauritian Wildlife Foundation in their awareness program. The integrated community development program of GML FJL at Chemin Rail has also received an environmental contribution through regular awareness activities, cleaning, and organised trips for educational purposes.

For the Future

ALTEO is committed to continue to fulfil the current undertakings of DRBC and FUEL in CSR activities which are met through FNR and GML FJL. It will thus support the activities of these SPV while defining how it can also more directly, use its financial and human resources against poverty and exclusion.

P. Arnaud Dalais Patrick de L. d’Arifat

Group Chief Executive Chief Executive Officer

September 20, 2013

The GML Fondation Joseph Lagesse (“GML FJL”) – Presentation and Actions

GML FJL has been created in 2005 to provide funds and assistance to social and environmental activities, and has confirmed the commitment that GML has traditionally sustained throughout the years.

The CSR contribution of ALTEO to the GML FJL for the year has amounted to Rs 2 m and has been spent to finance projects in line with the objectives set by the Management Board. These are:

• Education

• Access to medical treatment and health

• Community Development

• Environment

Education

GML FJL’s main objective is education. GML FJL is determined to promote education at all levels and to target the most vulnerable children by starting from early childhood, through its 15 dedicated centres around Mauritius. The education of adolescents is reflected through specialised ANFEN (Adolescent Non Formal Education) schools for students who have experienced failures at CPE. At the tertiary level, GML FJL has sought to broaden its support by also focusing on Rodrigues, and among the 24 students who received scholarships from GML FJL, 13 of them are from Rodrigues and are now studying at the University of Mauritius. In addition to the stipend paid monthly to all students, those Rodrigues’s students also receive a housing allowance and a return ticket to spend Christmas with their parents in Rodrigues. Finally GML FJL supports adult literacy.

Access to Health Treatment

GML FLJ is also resolute in helping poor persons to have a better access to medical treatment and health. Its actions are however somehow limited by some restrictive criteria of CSR “guidelines”.

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45CORPORATE GOVERNANCE


• a Director who has declared his interest shall not vote on any matter relating to the transaction or proposed transaction in which he is interested, and shall not be counted in the quorum present at the meeting;

• in case of equality of votes at either a Board meeting or a Shareholders’ meeting, the Chairperson of the meeting shall not be entitled to a casting vote;

HOLDING STRUCTURE

The holding structure of ALTEO as at reporting date is as follows:

• a Director is not required to hold shares in the Company; and

• the Company may indemnify and/or insure any Director or employee of the Company or a related company.

A copy of ALTEO’s Constitution is available upon request in writing to the Company Secretary at the registered office of the Company, Vivéa Business Park, Saint Pierre.

Deep River Investment Limited

(DRI)

ALTEO LIMITED

GML Investissement Ltée

(GMLI)Others

20.96% 26.92% 52.12%

The Group’s shareholding is found on page 6 of the Annual Report.

COMMON DIRECTORS

The names of the common Directors are as follows:

Directors ALTEO DRI GMLI

Arnaud Lagesse(1) ü** ü*

Jan Boullé ü ü**

G. Christian Dalais ü ü**

P. Arnaud Dalais ü ü

Louis Guimbeau ü ü

Thierry Lagesse(1) ü ü

** Chairman* Alternate Director

(1) Mr. Thierry Lagesse has acted as Chairman of the Board of Directors of the Company up to August 9, 2013, date on which he has decided to step down following an allegation made against him in relation to a case of customs fraud. As a result, on August 13, 2013, the Board has nominated Mr. Arnaud Lagesse as Chairman of the Board of Directors in replacement of Mr. Thierry Lagesse.

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CORPORATEGOVERNANCEAlteo Limited (formerly known as Deep River-Beau Champ Limited) (“ALTEO” or “the Company”) is a public company incorporated on April 18, 1913.

On July 20, 2012, Flacq United Estates Limited (“FUEL”) was amalgamated with and into ALTEO (formerly known as Deep River-Beau Champ Limited) in accordance with sections 244 to 246 and 248 of the Companies Act 2001.

Upon completion of the said amalgamation:

• all of the existing 186,986,700 ordinary shares of Rs 10.00 each of ALTEO were converted into ordinary shares of no par value;

• shares of ALTEO have migrated from the Development & Enterprise Market (“DEM”) to the Official Market of the Stock Exchange of Mauritius Ltd (“SEM”) at market close of July 30, 2012 and consequently, the listing of ALTEO on the DEM has been cancelled as from market close of July 30, 2012;

• the shares of ALTEO have been listed on the Official Market of the SEM on July 31, 2012 and dealings in the ALTEO shares resumed as from that date; and

• 131,505,420 new ordinary shares of no par value were issued and allotted to the former shareholders of FUEL for a consideration other than cash totalling Rs 7,121,728,000.-

As a result of the above, the stated capital of ALTEO is currently Rs 8,991,595,000.- divided into 318,492,120 ordinary shares of no par value.

STATEMENT OF COMPLIANCE

The Board of Directors and management of ALTEO reiterate their commitment to ensuring and maintaining a high standard of corporate governance within the Company and the Group to ensure transparency and protection of the interests of ALTEO’s shareholders and all stakeholders at large.They also recognise the need to adapt and improve the principles and practices in light of their experience, regulatory requirements and investor expectations.

In addition, the Board of Directors and Management of ALTEO ensure that although the business environment changes, the values of ALTEO remain consistent. They also make sure that the Group operates in an ethical

manner that meets accounting regulations and aligns with global industry and environmental best practices.This report describes, among others, the main corporate governance framework and compliance requirements of the Company with:

• its Constitution;

• the terms of reference of the Board Committees;

• the disclosures required under the Code of Corporate Governance for Mauritius (the “Code”);

• the Companies Act 2001;

• the Securities Act 2005; and

• the listing rules of the Stock Exchange of Mauritius.

COMPANY’S CONSTITUTION

The Constitution of the Company is in conformity with the provisions of the Companies Act 2001 and the Listing Rules of the SEM.

Its salient features are:

• fully paid up shares are freely transferable;

• the Company may purchase or otherwise acquire its own shares and may hold the acquired shares;

• the Board may authorise a distribution by the Company if it is satisfied on reasonable grounds that the Company will satisfy the solvency test immediately after the distribution;

• the quorum for a shareholders’ meeting is at least 5 members present in person or proxy together holding shares representing at least 30% of the total voting rights;

• the Board shall consist of a minimum of 7 Directors and a maximum of 15 Directors;

• the quorum for a meeting of the Board is 5 Directors when the Board consists of 7 or 8 members, 6 Directors when the Board consists of 9 or 10 members, 7 Directors when the Board consists of 11 or 12 members, 8 Directors when the Board consists of 13 or 14 members and 9 Directors when the Board consists of 15 members;

• the Directors have the power to appoint any person to be a Director, either to fill a casual vacancy or as an addition to the existing Directors but so that the total number of Directors shall not at any time exceed the number fixed in accordance with the Constitution. The Director so appointed shall hold office only until the next following annual meeting of Shareholders and shall then be eligible for re-election;


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Number of Category of Number of % of Total

Shareholders Shareholders Shares Owned Issued Shares

2,634 Individuals 90,789,414 28.51

13 Insurance and Assurance Companies 10,469,199 3.29

39 Pensions and Provident Funds 7,655,307 2.40

56 Investment and Trust Companies 182,567,127 57.32

358 Other Corporate Bodies 27,013,073 8.48

3,100 318,492,120 100.00

SHARES IN PUBLIC HANDS

In accordance with the Listing Rules of the SEM, at least 25% of the shareholding of ALTEO is in the hands of the public.

SHAREHOLDERS’ COMMUNICATION

The Board of Directors of ALTEO places great importance on open and transparent communication with all shareholders. It endeavours to keep the shareholders regularly informed on matters affecting the Company by official press announcements, disclosures in the Annual Report and at the Annual Meeting of Shareholders.

As required by virtue of its obligations as a reporting issuer, ALTEO produces quarterly, half-yearly and annual reports as required and publishes same immediately after their respective approval by the Board of Directors. These reports are also submitted to the SEM and the FSC. In addition, to comply with periodic reportorial requirements, the Company punctually discloses major and market-sensitive information such as dividend declarations via press releases.

The Company’s website www.alteogroup.com is an important means of effectively communicating with all stakeholders, keeping them abreast of developments within the ALTEO Group.

The Company’s Annual Meeting provides an opportunity for shareholders to raise and discuss matters with the Board relating to the Company, its vision, its performance, its challenges and opportunities, among others. The Chairmen of the Company’s committees namely the Audit & Risk Committee and the Corporate Governance, Nomination and Remuneration Committee are normally also available at the Annual Meeting to answer any questions relating to their assigned duties. The external auditors and the Company Secretary are also present at that meeting.

All shareholders are encouraged to attend the Annual Meeting to remain informed of the Group’s strategy and goals.

SHAREHOLDING PROFILE

The share ownership and categories of shareholders at June 30, 2013 were as follows:

The above number of shareholders is indicative due to consolidation of multi-portfolios for reporting purposes. The total number of active shareholders as at June 30, 2013 was 3,663.

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COMPANY’S REGISTERED OFFICE

Since April 2013, the registered office of the Company is situated at Vivéa Business Park, Saint Pierre.

SHARE REGISTRY AND TRANSFER OFFICE

ALTEO’s Share Registry and Transfer Office is administered by MCB Registry & Securities Limited. For any queries regarding an account and/or change in name or address, and/or questions about lost share certificates, share transfers or dividends, the shareholder is invited to contact the Share Registry and Transfer Office, details of which are found on page 4 of the Annual Report.

ShareholdersNumber of Shares

Owned

%

Holding

GML Investissement Ltée 85,742,078 26.92

Deep River Investment Limited 66,746,340 20.96

SHAREHOLDERS’ AGREEMENT

To the best knowledge of the Company, there has been no such agreement with any of its Shareholders for the year under review.

EMPLOYEE SHARE OPTION PLAN

ALTEO has no Employee Share Option Plan.

Number of Size of Number of % of Total

Shareholders Shareholding Shares Owned Issued Shares

474 1 - 500 shares 95,104 0.03

279 501 - 1,000 shares 212,208 0.07

789 1,001 - 5,000 shares 2,073,695 0.65

395 5,001 - 10,000 shares 2,855,678 0.90

712 10,001 - 50,000 shares 16,151,249 5.07

190 50,001 - 100,000 shares 13,464,284 4.23

144 100,001 - 250,000 shares 23,065,232 7.24

57 250,001 - 500,000 shares 19,575,269 6.14

25 500,001 – 1,000,000 shares 17,098,776 5.37

35 1,000,001 + shares 223,900,625 70.30

3,100 318,492,120 100.00

SUBSTANTIAL SHAREHOLDERS

The shareholders holding more than 5% of the share capital of ALTEO at the date of reporting were as follows:

SHAREHOLDING PROFILE

The share ownership and categories of shareholders at June 30, 2013 were as follows:


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• monitoring the effectiveness of the Group’s governance practices and making changes as needed;

• reviewing and, where appropriate, approving risk policy, financial statements, annual budgets, business plans and Committees’ reports;

• overseeing major capital expenditure, acquisitions and divestments;

• ensuring the precision and integrity of the Company’s accounting and financial reporting systems, including the independent audit;

• ensuring that the appropriate systems of control are in place to prevent any malpractices;

• selecting, compensating and monitoring key executives and overseeing management succession planning;

• ensuring that the Company’s business is conducted with the highest standards of ethical conduct and in conformity with applicable laws and regulations in Mauritius at all times; and

• overseeing the process of disclosure and communication.

BOARD OF DIRECTORS

ALTEO is headed by a highly forward looking and skilled Board which is collectively responsible for promoting the success of the Company and for the overall corporate governance of the Group. The Board of Directors sets the corporate strategies of the Group and sets directions and goals for the management. It supervises the management and monitors performance of these goals to enhance shareholders ‘value.

The Board of ALTEO is aware of its responsibility to ensure that the Company adheres to all relevant legislation, complies with the Listing Rules of the SEM and applies the principles of good governance throughout the Group. The Directors perform their duties, responsibilities and powers to the extent permitted by law.

The key functions of the Board include inter alia:

• overseeing the conduct of the Company’s business, to evaluate whether the business is being properly managed at all levels;

20%

15%

10%

5%

0%

-5%

-10%

-15%

31-Jul-2

012

31-Aug

-2012

30-Sep

-2012

31-Oct-

2012

30-Nov-2

012

31-Dec

-2012

31-Jan-2

013

28-Feb-

2013

31-Mar-

2013

30-Apr-

2013

31-May

-2013

30-Jun-2

013

Alteo

Semdex

SHARE PRICE INFORMATION

The share price of ALTEO increased by 17% over the past year, from the market introductory price of Rs 30.40 on July 31, 2012 to Rs 35.60 at June 30, 2013, with the Semdex increasing by 9% for the same period.

Performance of ALTEO share versus the Market (2012/2013)

To date, the share of ALTEO is quoted at Rs 34.75 on the Official Market of the SEM.

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DIVIDEND POLICY

No formal dividend policy has been determined by the Board. Dividend payments are determined by the profitability of the Company, its cash flow, its future investments, its ability to meet future expenses, its growth opportunities and its visibility on the medium and long term.

Dividends are normally declared and paid twice yearly. Directors ensure that the Company satisfies the solvency test for each declaration of dividend and a certificate of compliance with the solvency test is signed by all Directors when a dividend is declared by the Board.

An interim dividend of Rs 0.30cs per share and a final dividend of Rs 0.45cs per share were declared during the financial year under review. The said dividends were paid on January 18, 2013 and July 22, 2013 respectively.

November 2013 Publication of first quarter results to September 30, 2013

December 2013 Declaration of an interim dividend*

December 2013 Annual Meeting of the Shareholders

January 2014 Payment of the interim dividend

February 2014 Publication of half-year results to December 31, 2013

May 2014 Publication of third quarter results to March 31, 2014

June 2014 Declaration of a final dividend*

July 2014 Payment of the final dividend*

September 2014 Publication of abridged end-of-year results to June 30, 2014

* Subject to the approval of the Board of Directors.

CALENDAR OF FORTHCOMING EVENTS

The Company has planned the following forthcoming events for the financial year ending June 30, 2014:


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G. Christian DalaisNon-Executive Director - first appointed to the Board in 1997 and Chairman from 2002 to 2010G. Christian Dalais, born in 1936, assumed the Chairmanship of DRBC (now Alteo Limited) for several years when he retired from that position in 2010. He has also been the Chairman of Sun Resorts Limited and Chief Executive Officer of Ireland Blyth Limited for numerous years. He however still sits on the Board of Sun Resorts Limited.

Directorships in other companies listed on the Official Market of the SEM: - IPRO Growth Fund Limited- Sun Resorts Limited

P. Arnaud DalaisExecutive Director - first appointed to the Board in 1984P. Arnaud Dalais, born in 1955, is the Group Chief Executive of Alteo Limited (ex-Deep River Beau-Champ Ltd (DRBC)) since November 1991. Under his leadership, the Company has gone through an important development both locally and on the international front. More recently he has been leading his team to successfully conclude the amalgamation of ex-FUEL with and into ex-DRBC which has since been renamed Alteo Limited. He is also the Chairman of the CIEL Group and as such chairs the Boards of CIEL Textile Ltd, CIEL Investment Ltd and Sun Resorts Ltd. He plays an active role at the level of the Mauritian private sector and has assumed the Chairmanship of a number of organizations including the Joint Economic Council from 1999 to 2001.

Directorships in other companies listed on the Official Market of the SEM: - Caudan Development Limited (Non-Executive Vice Chairman) - Promotion and Development Limited- Sun Resorts Limited (Non Independent Chairman)

Directorships in other companies listed on the Official Market of the SEM: - Ireland Blyth Limited (Non-Independent Chairman)- LUX* Island Resorts Ltd (Non-Independent Chairman)- Mauritius Stationery Manufacturers Limited - Phoenix Beverages Limited- The United Basalt Products Ltd

Jean-Claude BégaNon-Executive Director - appointed to the Board on July 20, 2012Jean-Claude Béga, born in 1963, is a Fellow of the Association of Chartered Certified Accountants. He joined GML in 1997 and is the Chief Financial Officer of GML Management Ltée. He is a member of the Mauritius Institute of Professional Accountants and a Fellow of the Mauritius Institute of Directors. Jean-Claude Béga is the Chairman of EllGeo Re. Mauritius Ltd and Director of a number of companies including AfrAsia Bank Limited, Anahita Estates Limited, Anahita Golf Ltd and Anahita Residences & Villas Limited. He is also a member of the Audit & Risk Committee of the Company.

Directorships in other companies listed on the Official Market of the SEM: - LUX* Island Resorts Ltd- Mauritius Stationery Manufacturers Limited- Phoenix Beverages Limited (Non-Independent Chairman)

Jan BoulléNon-Executive Director - appointed to the Board on July 20, 2012Jan Boullé, born in 1957, is an ‘Ingénieur Statisticien Economiste (France)’ and holds a diploma of ‘3ème cycle de Sciences Economiques, Université Laval, Quebec (Canada)’. He joined the Constance Group in 1984 and is currently Head of Projects and Development. Jan Boullé has recently been appointed as Non-Executive Chairman of GML Investissement Ltée and is also a member of the Board of Directors of several of the country’s major companies.

Directorships in other companies listed on the Official Market of the SEM: - Belle Mare Holding Limited- Phoenix Beverages Limited

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The composition of the Board is reviewed annually by the Corporate Governance Committee, in its capacity as Nomination Committee, to ensure that the Board has the appropriate mix of expertise and experience, and collectively possesses the necessary core competencies for effective functioning and informed decision-making.

On July 20, 2012, which is the effective date of the amalgamation of FUEL with and into DRBC, a new Board of Directors of ALTEO was constituted. Messrs. Maurice P. Dalais, Roger Espitalier Noël, Jean-Claude Harel, J. Cyril Lagesse and Robert Lagesse submitted their resignations and Messrs. Jean-Claude Béga, Jan Boullé, Amédée Darga and Patrick de L. d’Arifat were appointed by the Board in replacement.

DIRECTORS’ PROFILES

The names of the Directors, their categories, their profiles and the list of their directorships in other listed companies are provided hereafter.

Arnaud LagesseNon-Independent Chairman - first appointed to the Board in 1995 and Chairman as from August 13, 2013Arnaud Lagesse, born in 1968, has been appointed as Chairman of the Company on August 13, 2013. He holds a “Maitrise de Gestion” from the University of Aix-Marseille III, France and is a graduate of “Institute Supérieur de Gestion”, France. He also completed an Executive Education Program at INSEAD, Fontainebleau, France and an Advanced Management Program (AMP180) at Harvard Business School, Boston, USA. He joined GML in 1995 as Finance and Administrative Director before becoming in August 2005 its Chief Executive Officer. He also participated in the National Corporate Governance Committee as a member of the Board. He is a member of the Board of Directors of several of the country’s major companies (Mauritius Stationery Manufacturers Limited, Phoenix Beverages, The United Basalt Products Ltd) and is the Chairman of Alteo Limited, Ireland Blyth Limited, IOREC Ltd, LUX* Island Resorts Ltd, AfrAsia Bank Limited, United Investments Ltd inter alia. Arnaud Lagesse is an ex-president of the Mauritius Chamber of Agriculture, the Mauritius Sugar Producers Association and the Sugar Industry Pension Fund. Arnaud Lagesse is also the Chairman of GML Fondation Joseph Lagesse since July 2012.

The Board of ALTEO is of the view that the responsibilities of the Directors should not be confined in a Board charter and has consequently resolved not to adopt a charter.

The Board also considers that its members should be continuously developing themselves. To this effect, the Board believes that its members should not be prohibited from serving on boards of other organisations provided that each Director has a duty to act in the best interests of the Company and is expected to ensure that his other responsibilities do not impinge on his responsibilities as a Director of ALTEO.

The Board members have unrestricted access to the records of the Company and also have the right to seek independent professional advice(s), at the expense of the Company, to enable them to discharge their responsibilities at their upmost abilities.

CHAIRMAN, GROUP CHIEF EXECUTIVE AND CHIEF EXECUTIVE OFFICER

ALTEO believes that a clear division of duties and responsibilities between the Non-Executive Chairman, the Group Chief Executive and the Chief Executive Officer ensures proper balance of power, increased accountability and greater capacity of the Board for independent decision-making.

The post of Non-Independent Chairman is held by Mr. Arnaud Lagesse following the decision of Mr. Thierry Lagesse to step down of the said function.

The posts of Group Chief Executive and Chief Executive Officer are held by Messrs. P. Arnaud Dalais and Patrick de L. d’Arifat respectively.BOARD COMPOSITION

The Company’s Constitution provides that unless otherwise determined by the shareholders in an Annual or Special Meeting, the number of Directors shall not be less than seven or more than fifteen.

ALTEO is currently managed by a unitary Board of ten members comprising of six Non-Executive Directors, two Independent Non-Executive Directors and two Executive Directors.


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Ltée and was responsible for all aspects of sugar cane production and diversification. Since 2000, Robert Baissac is the CEO of TPC Ltd and he is responsible of the overall operations of the said company as well as the rehabilitation and expansion programmes.

Jean-Luc Harel – COO Sugar Milling & Energy ActivitiesJean-Luc Harel, born in 1952, holds a National Diploma in Sugar Technology from the University of Natal, South Africa. He started his career at the Mon Désert Alma Sugar Factory as Assistant Chemist. In 1975, he joined Médine Sugar Estate Ltd as Assistant Factory Manager, then moved to Reufac Sugar Estate as Factory Manager and subsequently to Boboulo Ltd as Manager before returning to FUEL Group in 1982 to erect the first Coal/Bagasse Cogeneration power plant at FUEL. In 1986, he was promoted to the position of Assistant Estate Manager before taking over as Estate Manager from 1993 to 1999 when he was seconded to be the General Manager of Companhia de Sena, SARL in Mozambique to take charge of the Marromeu Estate and factory rehabilitation. He returned to Mauritius in July 2005 to resume his position as Manager of FUEL and of its sugar industry subsidiaries. Jean-Luc Harel is currently the Chief Operations Officer of the sugar milling & energy activities of Alteo Limited.

Sébastien Lavoipierre – Designate COO Sugar Milling & Energy ActivitiesSébastien Lavoipierre, born in 1972, holds a Bsc. degree in Chemical Engineering from University of Natal and an MBA from Heriot Watt University, Edinburgh Business School. He joined Les Gaz Industriels in 1998 as Production Manager and then held a senior management position at Ireland Blyth Limited from 2003 to 2006. He was the project Manager of the MCFI Group from 2007 to 2008 and Business development Manager of the Harel Mallac Group in 2009. In 2010, he was promoted as the Managing Director of the Chemical arm of the Harel Mallac Group. Since August 2013, Sébastien Lavoipierre joined Alteo Limited as Designate Chief Operations Officer of the sugar milling and energy activities.

Patrice Legris – CEO of Alteo Properties Ltd (formerly known as CIEL Properties Ltd)Patrice Legris, born in 1957, holds a Masters in Economic and Social Administration from Sorbonne – Paris, as well as a Diploma in Personnel Management from the University of Mauritius. CEO of Alteo Properties Ltd since April 2012, Patrice was previously CEO of l’AHRIM

Thierry LagesseNon-Executive Director - first appointed to the Board in 1983 and Non-Independent Chairman up to August 9, 2013Thierry Lagesse, born in 1953, holds a ‘Maîtrise des Sciences de Gestion’ from the University of Paris Dauphine. He is a Director of GML, Ireland Blyth Limited, Phoenix Beverages Limited and The United Basalt Products Ltd and of several other companies quoted on the Stock Exchange of Mauritius Ltd. He is also the Executive Chairman and founder of Palmar Group of Companies and the Executive Chairman of Parabole Réunion SA.

Directorships in other companies listed on the Official Market of the SEM: - Ireland Blyth Limited - Mauritius Stationery Manufacturers Limited- Phoenix Beverages Limited - Sun Resorts Limited- The United Basalt Products Ltd

PROFILES OF THE SENIOR MANAGEMENT TEAM

P. Arnaud Dalais – Group Chief Executive

Please refer to page 51 of the Annual Report.

Patrick de L. d’Arifat – Chief Executive Officer


Jérôme De Chasteauneuf – Head of FinanceJérôme De Chasteauneuf, born in 1966, is qualified as Chartered Accountant of England and Wales. He also holds a BSc honours in Economics from the London School of Economics and Political Science (1989). He joined the CIEL Group in 1993 as Project Financier and became Head of Finance of DRBC (now Alteo Limited) and of the CIEL Group in 2000.

Robert Baissac – CEO of TPC LtdRobert Baissac, born in 1960, holds a BSc honours in Agriculture from the University of Natal, Pietermaritzburg. He joined the Company in 1984 as Assistant Agronomist and was then appointed Agronomist in charge of diversification in 1985. In 1987, he joined Mon Trésor Mon Désert S.E as Sugar Cane Agronomist and was also in charge of Agricultural diversification and in 1991, he was appointed Field Manager of Cie de Beau Vallon

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Patrick de L. d’ArifatExecutive Director - appointed to the Board on July 20, 2012Patrick de L. d’Arifat, born in 1958, holds a BSC degree in Economics and Accountancy from City University, London. He started his career with the Mauritius Chamber of Agriculture in 1982 and in 1991 he was appointed Director of the Mauritius Sugar Producers Association. He has chaired that same association for three years and that of the Mauritius Sugar Syndicate for two years. He joined CIEL Agro-industry as Chief Executive Officer in July 2001. Patrick de L. d’Arifat has, throughout those years, been closely associated with the policy formulation and implementation of the modernization process of the sugar industry in Mauritius and in the region. Since April 2013, he is the Chairman of the Mauritius Sugar Producers Association (MSPA). Patrick de L. d’Arifat is the Chief Executive Officer of Alteo Limited.

Directorship in other companies listed on the Official Market of the SEM: - Rogers and Company Limited

Louis GuimbeauNon-Executive Director - first appointed to the Board in 1991Louis Guimbeau, born in 1950, is a Fellow of the Institute of Financial Accountants (UK), a Member of the Chartered Management Institute (UK) and Fellow of the Mauritius Institute of Directors. He has worked in the Export Processing Zone, in the diamond cutting industry and in various companies of the Rogers Group. He actively participated in the setting-up of a Freeport Developer and a third party service provider company. He retired in 2010 as Finance and Administrative Manager of Saint Aubin Group. Louis Guimbeau is a member of the Company’s Corporate Governance, Nomination and Remuneration Committee and Audit & Risk Committee of the Company.

Directorship in other companies listed on the Official Market of the SEM: - Sun Resorts Limited

DIRECTORS’ PROFILES (cont’d)

Amédée DargaIndependent Non-Executive Director - appointed to the Board on July 20, 2012Amédée Darga, born in 1951, is a Fellow of the Institution of Engineers of Mauritius. He is the Chairman of Enterprise Mauritius, Managing Partner of Straconsult, a Social Science Researcher, a Trustee of SEATINI (Southern & Eastern Africa Trade Information Network Initiative) since 2003 and Chairman of the Mauritius Africa Business Club. Amédée Darga has served as Minister of Housing, Lands, Town and Country Planning for two years and previously occupied numerous positions such as Mayor of Curepipe. He was a Member of Parliament since the age of 26 and from 1976, Trade Union Negotiator and Adviser. He is a regular resource person to the United Nations on matters of governance. Amédée Darga is a member of the Company’s Audit & Risk Committee of the Company.

Directorship in other companies listed on the Official Market of the SEM: none.

Jean de FondaumièreIndependent Non-Executive Director - first appointed to the Board in 1996Jean de Fondaumière, born in 1953, is a Chartered Accountant of Scotland. He worked in Australia for eleven years and he retired as the CEO of the Swan Group at the end of 2006 after fifteen years. He is a past Chairman of The Stock Exchange of Mauritius and his former directorships include companies operating in the African, Indian Ocean and Asia Pacific regions. Jean holds a portfolio of directorships in Mauritius for companies operating in commerce, finance, power generation, sugar and tourism. He is the current Chairman of the Audit & Risk Committee and of the Corporate Governance, Nomination and Remuneration Committee of the Company.

Directorships in other companies listed on the Official Market of the SEM: - LUX* Island Resorts Ltd- Terra Mauricia Ltd


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Whist operating within a defined terms of reference, these two Committees regularly report and recommend action(s) to the Board. The Company Secretary acts as secretary to the Board Committees. The minutes of each Board Committee meeting are submitted for confirmation at the following meeting and then signed by the Chairman of the Board Committee and the Company Secretary.

The Board Committees are authorised to obtain, at the Company’s expense, professional advice both within and outside the Company in order for them to perform their duties.

Audit & Risk Committee

The core responsibilities of the Audit and Risk Committee remains the:

• monitoring of the integrity of the financial statements of the Company and the Group and any formal announcements relating to the Company’s financial performance, before submission to the Board;

• recommendation to the Board of the condensed unaudited quarterly financial statements;

• review of the effectiveness of the Company’s internal control and risk management systems;

• monitoring and review of the effectiveness of the Company’s internal audit function;

• approval of the appointment and/or termination of the internal auditor;

• monitoring and supervision of the effective function of the internal audit;

• monitoring of the objectivity and independence of the external auditors;

• recommendation to the Board on the appointment, re-appointment, removal of the external auditors and their fees;

• reviewing of the external auditors’ management letter; and

• conduct of investigations into any matters within its scope of responsibilities.

In line with the Code, the Board has nominated an Independent Non-Executive Director to chair the Audit & Risk Committee and the said Committee comprises four members, two Non-Executive Directors and two Independent Non-Executive Directors.

BOARD MEETINGS (cont’d)

• the unaudited quarterly & three months consolidated results at September 30, 2012 for publication;

• the review of the operations;

• the declaration and payment of an interim dividend for the year ended June 30, 2013;

• the unaudited quarterly & half-yearly consolidated results at December 31, 2012 for publication;

• the forecasts of the Company’s and the Group’s at June 30, 2013;

• the change of the registered office to Vivéa Business Park, Saint Pierre;

• the unaudited quarterly & nine months consolidated results at March 31, 2013 for publication;

• the setting up of a Multicurrency Note Programme of a maximum aggregate nominal value of Rs 5 billion, pursuant to which the Company may issue one or more tranches or series of Notes by way of private placement;

• the results of the bidding for the issue of a first tranche of the Notes amounting to Rs 1 billion;

• the revised forecasts of the Company’s and the Group’s at June 30, 2013;

• the declaration and payment of a final dividend for the year ended June 30, 2013; and

• the operating budgets for 2013/2014.

The minutes of the proceedings of each Board meeting are recorded by the Company Secretary and are entered in the Minutes Book of the Company. The minutes of each Board Meeting are submitted for confirmation at its next meeting and these are then signed by the Chairman and the Company Secretary.

BOARD COMMITTEES

To facilitate effective management, the Board delegates clearly defined responsibilities to its specialised committees for the preparation of specific topics submitted for its approval.

In line with the Code, the Board has set a Corporate Governance, Nomination and Remuneration Committee and an Audit & Risk Committee.

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The Directors may ask for any explanations or the production of additional information and, more generally, submit to the Chairman any request for information or access to information which might appear to be appropriate to him.

A quorum of six Directors is currently required for a Board meeting and in case of equality of votes; the Chairman does not have a casting vote. In addition to Directors, key management personnel and outside consultants are invited to attend Board meetings when deemed necessary.

During the year under review, the Board met five times with an attendance rate of 94% (2012: 91%). Decisions were also taken by way of resolutions in writing, agreed and signed by all the Directors then entitled to receive notice of the meeting.

During its meetings, the Board considered, approved and recommended to the shareholders of the Company, amongst other items:

• the completion of the Amalgamation of FUEL with and into the Company with effective date being July 20,2012;

• the constitution of a new Board of Directors following the above mentioned Amalgamation;

• the change of name of the Company from Deep River-Beau Champ Limited to Alteo Limited;

• the change of the registered office to 13, St Clement Street, Curepipe;

• the issue and allotment of 131,505,420 ordinary shares of no par value to the former shareholders of FUEL for a consideration other than cash of Rs 7,121,728,000.-;

• the listing of the ordinary shares of the Company on the Official Market of the SEM;

• the final forecasts of the Company’s and the Group’s at June 30, 2012;

• the operating budgets for 2012/2013;

• the reports and the recommendations of the Audit & Risk Committee and of the Corporate Governance, Nomination and Remuneration Committee;

• the annual financial statements at June 30, 2012 and the relevant abridged audited consolidated results for publication;

• the annual report 2012;

• the convening of the Shareholders’ Annual Meeting 2012;

PROFILES OF THE SENIOR MANAGEMENT TEAM (cont’d)

(Association des Hoteliers et Restaurateurs de l’Ile Maurice) and former director of the Mauritius Sugar Producers Associations (MSPA).

Jean-Robert Lincoln – Group Agricultural Development ExecutiveJean-Robert Lincoln, born in 1959, joined the Company in 1985. Initially involved with sugarcane operations in Mauritius, he occupied various responsibilities within Agronomy and R&D. He has, over the last fifteen years, been playing a more active role in evaluating and developing agricultural opportunities abroad and is currently Group Agricultural Development Executive. He holds a BSc in Crop Science from Natal University, South Africa (1983), a Certificate in Sugar Agriculture from the South African Sugar Association (1984), a Certificate in Agricultural Water Management from Cranfield University, UK (1990), and an MBA from the University of Surrey, UK (1997).

Christian Marot – COO Agricultural ActivitiesChristian Marot, born in 1958, holds a Diploma in Management Studies from the University of Mauritius (1985) and Master in Business Administration from the University of Surrey, England (1997). He joined the company in 1983 as Section Manager and occupied successively the post of Assistant Field Manager (1987) and Field Manager (1991) until his nomination as General Manager in 2002. Christian Marot is currently the Chief Operations Officer of the agricultural activities of Alteo Limited.

BOARD MEETINGS

The Board has four scheduled meetings each year. Other meetings may nevertheless be called from time to time as may be determined and required.

Board meetings are convened by giving appropriate notice after obtaining approval of the Chairman and of the Chief Executive Officer. As a general rule, detailed agenda, management reports and other explanatory statements are circulated in advance amongst the Directors to facilitate meaningful, informed and focused decisions at the meetings. To address specific urgent business needs, meetings are at times called at shorter notice.


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• In its role as Remuneration Committee, determining and developing the Company’s and Group’s general policy on executive and senior management remuneration and making recommendations to the Board on all the essential components of remuneration whilst determining the adequate remuneration to be paid to Directors and senior management.

In line with the Code, the Committee considers an “Independent” Director as one who:

• is not a representative or member of the immediate family of a shareholder who has the ability to control or significantly influence the Board or management;

• has not been employed by ALTEO or the group of which ALTEO currently forms part, in any executive capacity for the preceding three financial years;

• is not a professional advisor to ALTEO or the group of which ALTEO currently forms part other than in a Director capacity;

• is not a significant supplier to, debtor or creditor of, or customer of ALTEO or the group of which ALTEO currently forms part, or does not have a significant influence in a group related company in any one of the above roles;

• has no significant contractual relationship with ALTEO or the group of which ALTEO currently forms part; and

• is free from any business or other relationship which could be seen to materially impede the individual’s capacity to act in an independent manner.

BOARD COMMITTEES (cont’d)

Audit & Risk Committee (cont’d)

The Committee met on September 16, 2013 to recommend to the Board the approval of the annual financial statements at June 30, 2013 and the relevant abridged audited consolidated results for publication.

The Audit & Risk Committee confirms that it has fulfilled its responsibilities for the year under review, in accordance with its terms of reference.

BDO & Co was last re-appointed as external auditors at the Company’s Annual Meeting held on December 18, 2012. Upon the recommendation of the Audit & Risk Committee, shareholders will be asked at the forthcoming Annual Meeting to approve the re-appointment of BDO & Co as external auditors and to authorise the Board of Directors to fix the remuneration of the auditors for the ensuing year.

For the year ended June 30, 2013, no non-audit services were carried out by BDO & Co.

In 2013/2014, the Audit & Risk Committee will maintain its focus on the continued examination and review of the internal control environment and risk management system within the Group.

Corporate Governance, Nomination and Remuneration Committee

Operating under approved terms of reference, the Corporate Governance, Nomination and Remuneration Committee is inter alia responsible for:

• making recommendations to the Board on all corporate governance provisions to be adopted so that the Board remains effective and follows prevailing corporate governance principles;

• In its role as Nomination Committee, reviewing the structure, size and composition of the Board, identifying and recommending to the Board possible appointees as Directors, making recommendations to the Board on matters relating to appointment or re-appointment of Directors and succession plans for Directors whilst assessing the independence of the Independent Non-Executive Directors; and

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approval, the unaudited quarterly & three months consolidated results at September 30, 2012 for publication;

• recommended to the Board the reappointment of EY as internal auditors;

• examined the reports of the internal auditors on internal control systems arising from the fieldwork performed by them and ensured that their recommendations be implemented;

• requested the help of the internal auditors for the elaboration of a Risk Register for the Company;

• reviewed and recommended to the Board for approval, the unaudited quarterly & half-yearly consolidated results at December 31, 2012 for publication;

• reviewed and recommended to the Board for approval, the unaudited quarterly & nine months consolidated results at March 31, 2013 for publication;

• examined the estimated results for the year ended June 30, 2013; and

• recommended to the Board the reappointment of BDO & Co. as external auditors for the years ended June 30, 2014 to June 30, 2016.

Members Category

Jean de Fondaumière - Chairman Independent Non-Executive Director

Jean-Claude Béga Non-Executive Director

Amédée Darga Independent Non-Executive Director

Louis Guimbeau Non-Executive Director

In attendance (when deemed appropriate)

P. Arnaud Dalais Group Chief Executive – Executive Director

Patrick de L. d’Arifat Chief Executive Officer - Executive Director

Jérôme De Chasteauneuf Head of Finance

EY Internal Auditors - Independent Service Provider

BDO & Co External Auditors - Independent Service Provider

The Audit & Risk Committee operates under the terms of reference approved by the Board. The Committee meets at least once each quarter and reports on its activities to the Board.

The Committee met five times during the year under review with an attendance rate of 95% (2012: 100%). A quorum of two members is currently required for an Audit & Risk Committee meeting.

The particulars of attendance at the Committee meetings are given on page 59 of the Annual Report.

During the financial year ended June 30, 2013, the Audit & Risk Committee has, amongst other things:

• reviewed the management letter submitted by the external auditors and followed up on their recommendations;

• reviewed and recommended to the Board for approval, the annual financial statements at June 30, 2012 and the relevant abridged audited consolidated results for publication;

• reviewed and recommended to the Board for


Audit & Risk Committee (cont’d)

The Board of Directors is of the view that the members of the Audit & Risk Committee have sufficient financial management expertise and experience to discharge its responsibilities properly.

The composition of the Audit & Risk Committee is as follows:


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(2) Mr. Thierry Lagesse has chaired the Board of Directors of the Company up to August 9, 2013, date on which he has decided to step down following an allegation made against him in relation to a case of customs fraud. As a result, on August 13, 2013, the Board has nominated Mr. Arnaud Lagesse as Chairman of the Board of Directors in replacement of Mr. Thierry Lagesse.

Directors Category

Board of

Directors

Audit & Risk

Committee

Corporate Governance,

Nomination & Remuneration

Committee

Annual Meeting of

Shareholders(held on

December 18, 2012)

Thierry Lagesse(2) NICB 5 out of 5 1 out of 1 yes

Jean-Claude Béga(1) NED 5 out of 5 5 out of 5 yes

Jan Boullé(1) NED 4 out of 5 no

G. Christian Dalais NED 4 out of 5 yes

P. Arnaud Dalais ED 5 out of 5 *3 out of 5 yes

Amédée Darga(1) INED 5 out of 5 5 out of 5 yes

Jean de Fondaumière INED 4 out of 5 5 out of 5 1 out of 1 yes

Patrick de L. d’Arifat(1) ED 5 out of 5 *5 out of 5 yes

Louis Guimbeau NED 5 out of 5 4 out of 5 1 out of 1 yes

Arnaud Lagesse(2) NED 5 out of 5 yes

In attendance

Jérôme De Chasteauneuf 5 out of 5 5 out of 5 yes

Jean-Luc Harel 4 out of 5 yes

Christian Marot 4 out of 5 yes

Internal Auditors 2 out of 2 no

External Auditors 5 out of 5 yes

* In attendance – not a member

ED = Executive DirectorINED = Independent Non-Executive Director NED = Non-Executive DirectorNICB = Non-Independent Chairman of the Board

(1) On the effective date of the amalgamation of FUEL with and into DRBC (now ALTEO), i.e on July 20, 2012, Messrs. Maurice P. Dalais, Roger Espitalier Noël, Jean-Claude Harel, J. Cyril Lagesse and Robert Lagesse submitted their resignations as Directors of the Company and Messrs. Jean-Claude Béga, Jan Boullé, Amédée Darga and Patrick de L. d’Arifat were appointed in replacement.

BOARD AND BOARD COMMITTEES ATTENDANCE (cont’d)

The attendance record of the Directors for the year ended June 30, 2013, is set out below:

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• reviewed the remuneration and benefits of the Executive Directors and of the key management personnel, after taking into consideration the market norms and practices, the Company’s results and their better performance and additional responsibilities.

The Corporate Governance Committee confirms that it has met its responsibilities for the year under review, in compliance with its terms of reference.

On September 20, 2013, the Committee reviewed and approved the present corporate governance section.

BOARD AND BOARD COMMITTEES ATTENDANCE

It is the responsibility of the Directors to attend Board meetings and Committee meetings. A Director of ALTEO is expected to spend the time and effort necessary to properly discharge his responsibilities. Accordingly, he is expected to regularly prepare for and attend meetings of the Board and all Committees on which he sits, with the understanding that, on occasion, he may be unable to attend a meeting.

A Director who is unable to attend a meeting is expected to notify either the Company Secretary or the Chairman of the Board or the Chairman of the appropriate Committee, in advance of such meeting.

Members Category

Jean de Fondaumière - Chairman Independent Non-Executive Director

Louis Guimbeau Non-Executive Director

Arnaud Lagesse Non-Independent Chairman

In attendance (when deemed appropriate)

P. Arnaud Dalais Group Chief Executive – Executive Director

Patrick de L. d’Arifat Chief Executive Officer - Executive Director

Jérôme De Chasteauneuf Head of Finance

In his capacity as new Chairman of the Board of Directors, Mr. Arnaud Lagesse has also been nominated as member of the Corporate Governance Committee in replacement of Mr. Thierry Lagesse.

During the year under review, the Committee met once with an attendance rate of 100% (2012: 100%). Decisions were also taken by way of resolutions in writing, agreed and signed by all the members of the Committee then entitled to receive notice of the meeting.

A quorum of two members is currently required for a meeting of the Corporate Governance, Nomination and Remuneration Committee.

The particulars of attendance at the Committee meetings are given on page 59 of the Annual Report.

During the year under review, the Corporate Governance Committee has:

• examined corporate governance issues;

• approved the corporate governance section of the Annual Report 2012;

• recommended to the Board the re-election of a Board member in accordance with Section 138(6) of the Companies Act 2001;

• recommended to the Board the re-election of the other Directors of the Company through separate resolutions;

• reviewed the Board and Board Committees’ fees for the year ended June 30, 2013; and


Corporate Governance, Nomination and Remuneration Committee (cont’d)

The composition of the Corporate Governance Committee has changed during the year under review and at the date of this report, the membership of the said Committee is as follows:


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All new Directors are required to notify in writing to the Company Secretary their direct and indirect holdings in shares of ALTEO. According to ALTEO’s Constitution, a Director is not required to hold shares in the Company.

Moreover, the Company is registered as a reporting issuer with the FSC and complies with the relevant disclosure requirements of the Securities Act 2005.

DIRECTORS’ REMUNERATION AND BENEFITS

For the remuneration and benefits received, or due and receivable, by the Directors from the Company and its subsidiaries as at June 30, 2013, please refer to page 67 of the Annual Report.

DIRECTORS’ AND OFFICERS’ INTEREST IN SHARES OF ALTEO LIMITED

Written records of the interests of the Directors and their closely related parties in shares of ALTEO are kept in a Register of Directors’ Interests. Consequently, as soon as a Director becomes aware that he is interested in a transaction, or that his holdings or his associates’ holdings have changed, this should be reported to the Company in writing. The Company Secretary then ensures that the Register of Interests is updated accordingly.

Direct InterestIndirect Interest

Directors No. of shares % %

Thierry Lagesse 33,577 0.01 0.93

Jean-Claude Béga - - -

Jan Boullé - - -

G. Christian Dalais - - -

P. Arnaud Dalais 632,128 0.20 0.00

Amédée Darga 1,075 0.00 -

Jean de Fondaumière - - -

Patrick de L. d’Arifat - - 0.00

Louis Guimbeau 11,940 0.00 -

Arnaud Lagesse - - 1.02

Officers

Jérôme De Chasteauneuf - - -

Jean-Luc Harel - - 0.00

Christian Marot - - -

The Directors and officers of ALTEO having direct and/or indirect interests in the ordinary shares of the Company at June 30, 2013 were as follows:

None of the Directors and officers had any interest in the equity of subsidiaries of ALTEO.

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collective contribution towards the achievement of the Company’s objectives and performance, whilst taking into account current market conditions and/or other factors which may be determined from time to time.

A management committee, consisting of the Chief Executive Office, the Head of Finance and the Human Resource Officer, handles remuneration matters related to the Company’s personnel.

STATEMENT OF REMUNERATION PHILOSOPHY

The Board has delegated to the Corporate Governance, Nomination and Remuneration Committee, the responsibility of determining the adequate remuneration to be paid to the Chairman of the Board, the Independent Non-Executive Directors, the Non-Executive Directors, the Executive Directors and the senior management staff.

The Group’s underlying philosophy is to set remuneration at an appropriate level to retain, motivate and attract high calibre personnel and Directors, and to reward them in accordance with their individual as well as

BOARD AND BOARD COMMITTEES FEES

The Directors, save for the Executive Directors, receive a Board remuneration consisting of a fixed fee and an additional attendance fee for each Board meeting.

In addition, the Directors who are Board Committee members receive a further fixed fee, with Chairpersons of Board Committees being remunerated at a higher rate. All Board Committees fees are approved by the Board of Directors following recommendation of the Corporate Governance, Nomination & Remuneration Committee.

Board Service Meeting Fees

Annual Chairman’s fixed fee Rs. 600,000

Annual Independent and Non-Executive Director’s fixed fee Rs. 150,000

Chairman, Independent and Non-Executive Director’s attendance fee Rs. 30,000

Audit & Risk Committee Service

Chairman’s fee Rs. 250,000

Member’s fee (except if the member is an Executive Director) Rs. 150,000

Corporate Governance, Nomination & Remuneration Committee Service

Chairman’s fee Rs. 125,000

Member’s fee (except if the member is an Executive Director) Rs. 75,000

The Board and Board Committees’ fees at June 30, 2013 were as follows:


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• ALTEO – Review of Human Resource & Payroll Processes;

• Anahita Hotel Ltd & Anahita Golf Ltd – Food & Beverage Process;

• Anahita Estates Ltd – Tax review

• TPC Ltd – Follow up review of Human Resource & Payroll processes;

• TPC Ltd – Review of the following processes:

- Purchases & Payables

- Store Management

- Treasury Management

- Financial Statement Close

INTERNAL CONTROL

The Board is satisfied that a continual process for identifying, evaluating and managing significant risks has been in place for the financial year and up to the date of this Annual Report. The effectiveness of the internal control systems is reviewed by the Audit & Risk Committee and the Board receives assurance from the Audit & Risk Committee, which derives its information from regular internal and external audit reports.

To date, no material financial problems have been identified that would affect the results reported in these financial statements. The Board confirms that if significant weaknesses had been identified during this review, the Board would have taken the necessary steps to remedy them.

RISK MANAGEMENT

At ALTEO, Risk Management is a part of doing business – it is a key responsibility of the Chief Executive Officer and his team, and an activity which is monitored by the Audit & Risk Committee and through this the Board of Directors of ALTEO.

The Board maintains full control and direction over appropriate strategic, financial, operational and compliance issues and has put in place an organisational structure with formally defined lines of responsibility, delegated authorities and clear operating processes. The systems that the Board has established are designed to safeguard both the shareholders’ investment and the assets of the Group.

BOARD EVALUATION

Upon completion of the amalgamation of FUEL with and into the Company, a new Board of Directors has been constituted. As a result of same, it has been decided that a Board evaluation will be carried out when all members of the Board will be fully conversant and familiar with the Company’s new structure and business activities.

INTERNAL AUDIT FUNCTION

PurposeThe internal audit function consists of an independent appraisal of the Company’s internal control framework. The objective is to assist the Board members, Audit & Risk Committee members and management in the effective discharge of their responsibilities to maintain an effective system of internal control.

The internal audit function is performed by EY.

ReportingThe internal auditors have unrestricted access to information and records of the entities in the Group. They report to the Audit & Risk Committee and, in this way, remain independent whilst maintaining an open and constructive communication line with management.

Audit CoverageAuditable areas are proposed by the internal auditor through a three year plan which is approved by the Audit and risk committee. The internal audit plan also ensures alignment of coverage and effort with the level of risk attributable to each process and related control procedures. The internal auditor performs their planned fieldwork, rate these areas in terms of risk levels, perform compliance testing on a sample basis and discuss their findings so as to propose recommendations to management with a view to reducing the level of risks in these areas. The final audit reports are then presented to the Audit & Risk Committee. As indicated in the fieldwork section below, fieldwork also includes follow up visits of previously audited areas in order to assess progress in the implementation of recommendations.

Audit FieldworkThe scope of the audit field work during the financial year 2012/2013 was:

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Besides during the same period, Mr. Arnaud Lagesse bought 3,251 shares indirectly and Mr. P. Arnaud Dalais sold 229,000 shares indirectly.

The other Directors and officers of ALTEO did not deal with the shares of the Company either directly or indirectly.

The Directors and officers of ALTEO have been made aware of their responsibilities in disclosing to the Company any acquisition or disposal in the Company’s securities, as per the Securities Act 2005 and the Listing Rules of the SEM.

DIRECTORS’ AND OFFICERS’ INDEMNITIES AND INSURANCE

A Directors’ and officers’ liability insurance policy has recently been subscribed to by the Company. The policy provides cover for the risks arising out of the acts or omissions of the Directors’ and officers’ of the Company. The cover does not provide insurance against fraudulent, malicious or willful acts or omissions.

NEWLY-APPOINTED DIRECTORS

In accordance with the Company’s Constitution, the Board may fill vacancies or newly-created directorships on the Board that may occur between Annual Meetings of shareholders, but so that the total number of Directors shall not at any time exceed the number fixed in accordance with the Constitution.

Under its nomination function, the Corporate Governance, Nomination and Remuneration Committee is responsible for identifying and recommending potential director(s) to the Board. Thereafter, newly appointed Directors are subject to election by shareholders at the Company’s Annual Meeting in their first year of appointment.

On appointment to the Board and any Committees, newly appointed Directors receive a complete induction pack from the Company Secretary and are invited to meet members of the management team in order to rapidly acquire a comprehensive view of the Company’s current operations practises, acceptable risks level and medium and long term strategy.

DIRECTORS’ AND OFFICERS’ DEALINGS IN SHARES OF ALTEO LIMITED

The Directors of ALTEO use their best endeavours to abide by the absolute prohibition principles and notification requirements of the Model Code on Securities Transactions by Directors as stipulated in Appendix 6 of the Listing Rules of the SEM.

ALTEO has set up a procedure whereby any Director wishing to deal in the shares of the Company should first notify the Chairman of the Company and receive a dated written acknowledgement prior to any dealing. In his own case, the Chairman of the Company should first notify the Board at a Board meeting and receive a dated written acknowledgement prior to dealing.

The Directors and officers of the Company are strictly prohibited from dealing in the shares of ALTEO at any time when in possession of unpublished price-sensitive information, or for the period of one month prior to the publication of the Company’s quarterly and yearly results and to the announcement of dividends and distributions to be paid or passed, as the case may be, and ending on the date of such publications/announcements.

Moreover, Directors and officers of ALTEO are also required to observe the insider trading laws at all times even when dealing in securities within permitted trading periods.

During the year under review, the dealings in ALTEO shares were as follows:

• Issue of ALTEO shares to the former shareholders of FUEL: Mr. Amédée Darga received 1,075 shares directly whereas Messrs. Thierry Lagesse, Arnaud • Lagesse and Jean-Luc Harel received indirectly 2,924,125, 2,004,225 and 398 shares respectively.

• Distribution in specie of ALTEO shares by Union Flacq Ltd: Mr. Thierry Lagesse received 31,697 shares directly and 14,845 shares indirectly whereas Mr. Arnaud Lagesse received 268,253 shares indirectly.

• Voluntary winding-up of The Beau Champ Holding Company Limited (“BCH”) and distribution of ALTEO shares by BCH: Mr. P. Arnaud Dalais received 968 shares directly whereas Messrs. Thierry Lagesse and Arnaud Lagesse received indirectly 24,218 and 113,028 shares respectively.


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CHARITABLE DONATIONS AND POLITICAL CONTRIBUTIONS


RETIREMENT BENEFIT OBLIGATION

The details of the total amount of provisions booked or otherwise recognised by the Company for payment of pensions are provided on page 129 - Notes to the Financial Statements.

RELATED PARTY TRANSACTIONS

For details on related party transactions, please refer to page 140 - Notes to the Financial Statements.

Nathalie Gallet, ACISFor Navitas Corporate Services LtdCompany Secretary

September 20, 2013

MANAGEMENT AGREEMENT (cont’d)

Moreover, no major agreements, other than those in the ordinary course of business, were contracted by the Company during the year under review.

ETHICS AND BUSINESS CONDUCT

The ALTEO Group together with its employees is committed to the highest standards of ethical and professional integrity. This commitment, which is actively endorsed by the Board and the management team, is based on a fundamental belief that business should be conducted honestly, fairly and legally whilst preserving the environment.

ENVIRONMENT, HEALTH AND SAFETY POLICY

ALTEO remains sensible to the climatic change to which the globe is subject to and takes environmental responsibility at heart and recognises the importance of preserving the integrity of natural heritage. In its endeavour to preserve the environment, it continuously aims at improving processes in its various operations.

The ALTEO Group of companies in addition believes in providing and maintaining a safe and healthy work environment for all its employees. The objective being the optimisation of work efficiency and the prevention of accidents at work, through the implementation of safety standards in all its operations across the Group.

SOCIAL CONTRIBUTION

The Company is committed to Corporate Social Responsibility (“CSR”) activities and will continue to support socio-economic development, education and training, childcare and health, through Fondation Nouveau Regard and GML Fondation Joseph Lagesse.

Please refer to pages 39 to 41 for more information on the Group’s CSER.

page



responsibilities and powers, whilst also ensuring that the Company is at all times in line with applicable laws, rules and regulations in Mauritius.

The Company Secretary administers, attends and prepares minutes of all Board meetings, specialised Committee meetings and Shareholders’ meetings. She assists the Chairman in ensuring that Board procedures are followed and that the Company’s Constitution and relevant rules and regulations are complied with. The Company Secretary also assists the Chairman and the Board in implementing and strengthening good governance practices and processes with a view to enhance long-term shareholders’ value.

Moreover, the Company Secretary is the primary channel of communication between the Company and the SEM.

MANAGEMENT AGREEMENT

ALTEO holds a service agreement with Navitas Corporate Services Ltd for the provision of company secretarial services.

Further to the amalgamation, ALTEO has also entered into a service agreement with two related companies, namely Ciel Corporate Services Ltd and GML Management Ltée, for the provision of legal, financial, secretarial services and administrative support to the companies of the ALTEO Group. Moreover, ALTEO has entered into a treasury agreement with Azur Financial Services Limited and GML Trésorerie Ltée, for the provision of cash management services, treasury advisory services and foreign exchange & money market brokerage services to the ALTEO Group.

ALTEO has a management agreement for the provision of administrative, financial, legal and technical services to four of its subsidiaries namely Alteo Energy Limited (formerly known as F.U.E.L. Steam and Power Generation Company Limited), Consolidated Energy Limited, Alteo Milling Ltd (formerly known as F.U.E.L. Sugar Milling Company Limited) and Deep River-Beau Champ Milling Limited.

ALTEO also has a management agreement for the provision of managerial and administrative services to Alteo Refinery Ltd (formerly known as FUEL Refinery Limited) which owns the refinery.

RISK MANAGEMENT (cont’d)

The Chief Executive Officer works with his team to identify potential risks to the Company’s business, rating identified risks by both probability and severity of impact. This team then develops strategies and action plans to offset or mitigate those risks.

Some of the prominent risks to which the Company is exposed are:

Financial risk – The Company is exposed to a wide range of financial risks, market risks (including currency risks and price risks), credit risks and liquidity risks as reported on page 96 – Note 3 to the Financial Statements.

Operational risk defined as the risk of loss resulting from inadequate or failed internal processes, people and systems or from external events.

Compliance risk defined as the risk of not complying with laws, regulations and policies.

Reputational risk defined as the risk of losses due to unintentional or negligent failure to meet a professional obligation to stakeholders.

The Audit & Risk Committee assesses the risk philosophy, strategy and policies. Its members have a solid understanding of the Company and consider the likelihood of occurrence and potential impact of inherent and other risks on the achievement of its business objectives. The Audit Committee also monitors the maintenance and improvement of the risk control systems implemented.

In discharging its responsibility towards the Board members, the Audit & Risk Committee relies upon the reports of the internal auditors and of the management to provide assurance on the Company’s system controls.

The Audit & Risk Committee has recently appointed EY to perform a comprehensive Business Risk Assessment exercise and compile. This exercise is currently in progress.

COMPANY SECRETARY

All Directors have access to the advice and services of the Company Secretary, Navitas Corporate Services Ltd, represented by Mrs. Nathalie Gallet, who is responsible for providing guidance to the Directors as to their duties,


page

67STATUTORY DISCLOSURES - YEAR ENDED JUNE 30, 2013

REMUNERATION AND BENEFITS

Remuneration and benefits received from the company and its subsidiaries were as follows:

THE COMPANY SUBSIDIARIES 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000

Directors of the CompanyExecutive Directors 24,152 - - - Non-Executive Directors 2,640 1,605 48 14 Independent Non-Executive Directors 1,095 295 - 2

Directors of the Subsidiary companiesExecutive Directors 32,159 12,922 12,290 - Non-Executive Directors - - 193 175

The emoluments of the Directors have not been disclosed on an individual basis due to the commercial sensitivity of such information.

DONATIONS

THE GROUP THE COMPANY 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000

Donations made during the year:

- Political 384 23 384 - - Charitable 256 1,171 - 2,556

AUDITORS’ FEES


Audit fees paid to:BDO & Co 5,094 3,401 1,200 555

Fees paid for other services provided by:BDO & Co - 2,640 - 2,390

The Board expresses its appreciation and thanks to all those involved for their contribution during the year.

Approved by the Board of Directors on September 20, 2013 and signed on its behalf by:

Arnaud Lagesse P. Arnaud DalaisChairman Director

(Pursuant to Section 221 of the Companies Act 2001 and Section 88 of the Securities Act 2005)

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66


STATUTORY DISCLOSURES YEAR ENDED JUNE 30, 2013

The Directors are pleased to present the Annual Report of Alteo Limited (the “Company’’) for the year ended June 30, 2013.

NATURE OF BUSINESS

The main activities of the Company consist of sugar cane growing and other agricultural activities.

The main activities of the Subsidiaries consist principally of:

- Sugar cane growing and milling and other agricultural activities;

- Sugar refining activities;

- Operating a bagasse and coal based power generation plant for the supply of electricity to the National Grid of the Central Electricity Board;

- Regional development; and

- Property development, hospitality and leisure.

DIRECTORS

The persons who held office as Directors of the Company as at June 30, 2013 are:

Thierry Lagesse (Chairman)

Jean-Claude Béga

Jan Boullé

G. Christian Dalais

P. Arnaud Dalais

Amédée Darga

Jean de Fondaumière

Patrick de L. d’Arifat

Louis Guimbeau

Arnaud Lagesse

The following changes occurred during the year under review:

On July 20, 2012, which is the effective date of the amalgamation of Flacq United Estates Limited with and into the Company, a new Board of Directors of ALTEO was constituted.

Messrs. Maurice P. Dalais, Roger Espitalier Noël, Jean-Claude Harel, J. Cyril Lagesse and Robert Lagesse submitted their resignations and Messrs. Jean-Claude Béga, Jan Boullé, Amédée Darga and Patrick de L. d’Arifat were appointed in replacement.

The other Directors of the Company, namely Messrs. Thierry Lagesse, P. Arnaud Dalais, G. Christian Dalais, Jean de Fondaumière, Louis Guimbeau and Arnaud Lagesse remained in service.

The Directors of the subsidiaries are disclosed on pages 70 to 73.

AUDITORS’ REPORT AND ACCOUNTS

The auditors’ report is set out on pages 80 and 81 and the income statements are set out on page 83.

DIRECTORS’ SERVICE CONTRACTS

Mr Patrick de L. d’Arifat has a service contract with the Company with no expiry terms. Mr Jean Luc Harel, Director of several subsidiary companies, has a service contract with the Company with an expiry term. Messrs. Jean Robert Lincoln, Gerard Rambert, Hugues René, Dominique Rousset & Andy Tonta, Directors of subsidiary companies, have a service contract with the Company with no expiry terms.

Mr Robert Baissac, Director of TPC Ltd, has a service contract with the said company with no expiry terms. Mr. Salim Soobadar, Director of Compagnie Usinière de Mon Loisir Ltée, has a service contract with the said company with no expiry terms.



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69page

68


STATUTORY DISCLOSURES - YEAR ENDED JUNE 30, 2013

STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE PREPARATION OF FINANCIAL STATEMENTS

Directors acknowledge their responsibilities for:

(i) adequate accounting records and maintenance of effective internal control systems;

(ii) the preparation of financial statements which fairly present the state of affairs of the Company as at the end of the financial year and the results of its operations and cash flows for that period and which comply with International Financial Reporting Standards (IFRS);

(iii) the selection of appropriate accounting policies supported by reasonable and prudent judgements.

The external auditors are responsible for reporting on whether the financial statements are fairly presented.

The Directors report that:

(i) adequate accounting records and an effective system of internal controls and risk management have been maintained;

(ii) appropriate accounting policies supported by reasonable and prudent judgements and estimates have been used consistently;

(iii) International Financial Reporting Standards have been adhered to. Any departure in the interest in fair presentation has been disclosed, explained and quantified.

(iv) the Code of Corporate Governance has been adhered to in all material aspects and reasons provided for non-compliance.

APPROVED BY THE BOARD OF DIRECTORS ON AND SIGNED ON ITS BEHALF BY:


September 20, 2013



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71

DIRECTORSHIPS OF SUBSIDIARY COMPANIES AS AT JUNE 30, 2013

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AH SUE William √

AH SUE Carine Barbara √*

AUCHARAZ Hastadeo √

BAISSAC Robert √

BÉGA Jean Claude √ √ √

BHEEKEE Mahensingh √

BHOLAH Premsagar √ √

BOULLE Jan √ √

CALLY Devendra √*

DALAIS Jean-Pierre √ √ √ √ √ √ √ √ √

DALAIS P. Arnaud √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √

DE CHASTEAUNEUF Jérôme √* √ √ √ √

DE L. D’ARIFAT Patrick √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ √

DUVAL Alexis √

DUVAL Philippe √ √ √

GOCOOL Geerendra √*

GOLAM Iswurlal √*

GOVINDEN Thierry Desire Laval √

HAREL Jean-Claude √ √ √

HAREL Jean-Luc √ √ √ √ √ √ √ √

LABRO Philippe √ √ √

LAGESSE Arnaud √ √ √ √* √* √* √

LAGESSE Stephane √* √* √

LAGESSE Thierry √ √ √ √ √ √ √ √ √ √ √ √ √ √ √

LECLEZIO Hubert √ √

LINCOLN Jean-Robert √ √

* Alternate Director** Société Ducomet and Société Gonin are both managed by West East Limited.

STATUTORY DISCLOSURES - YEAR ENDED JUNE 30, 2013(Pursuant to Section 221 of the Companies Act 2001 and Section 88 of the Securities Act 2005)

page

70



page




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MALLAM HASHAM Muhammad Iqbal √

MARTIN Gerard √

MAUNICK Youlaganaden √

MLAKI Elipina √

RAMBERT Gerard √

RAMDHARY Shyamduthsingh √ √

RAMPERSAD Khemlall √

RENE Hugues √

REY Clément √* √* √ √

RIBET Jean √ √ √ √ √ √ √

ROUSSET Dominique √

SEMWAZA Henry √

SOOBADAR Salim √

SOOJHAWON Swayaj √

THIEBLIN Xavier √ √

TONTA Andy √

* Alternate Director** Société Ducomet and Société Gonin are both managed by West East Limited.


DIRECTORSHIPS OF SUBSIDIARY COMPANIES AS AT JUNE 30, 2013 (con’d)

page



Anahita Estates Limited

Mr. Jerome de Chasteaunuef resigned as Director on August 16, 2012

Mr. Jan Boullé appointed as Director on August 17, 2012

Anahita Golf Ltd

Mr. Jerome de Chasteaunuef resigned as Director on August 16, 2012

Mr. Jean-Claude Béga appointed as Director on August 17, 2012

Commercial and Industrial Enterprises Limited

Mr. G. Christian Dalais resigned as Director on December 20, 2012

Mr. Maurice Dalais resigned as Director on December 20, 2012

Mr. J. Cyril Lagesse resigned as Director on December 20, 2012

Mr. Louis Guimbeau resigned as Director on December 20, 2012

Mr. Jean-Claude Harel resigned as Director on December 20, 2012

Mr. Jean de Fondaumiere resigned as Director on December 20, 2012

Mr. Robert Lagesse resigned as Director on December 20, 2012

Mr. Roger Espitalier Noel resigned as Director on December 20, 2012

Mr. Jean-Pierre Dalais appointed as Director on December 20, 2012

Mr. Patrick de L. d’Arifat appointed as Director on December 20, 2012

Compagnie de la vigie Limitée

Mr. J. Cyril Lagesse resigned as Director on August 16, 2012

Mr. P. Arnaud Dalais appointed as Director on August 16, 2012

Compagnie Usinière de Mon Loisir Ltée

Mr. Veerapen Moonsamy resigned as Director on December 3, 2012

Mr. Gajandranath Mutty resigned as Director on March 29, 2013

Mr. Patrick de L. d’Arifat appointed as Director on August 16, 2012

Mr. Swaraj Soojhawon appointed as Director on March 29, 2013

Mr. Salim Soobadar appointed as Director on March 29, 2013


page

74


DIRECTORSHIPS OF SUBSIDIARY COMPANIES AS AT JUNE 30, 2013 (con’d)

The following changes occurred during the year under review:

Alteo Energy Ltd (formerly F.U.E.L Steam and Power Generation Company Limited)

Mr. Jean Lagesse resigned as Director on August 16, 2012

Mr. Robert Lagesse resigned as Director on August 16, 2012

Mr. Yodhunsingh Daumoo resigned as Director on December 13, 2012

Mr. Hubert Leclezio resigned as Director on August 16, 2012



Mr. Jean-Pierre Dalais appointed as Director on August 16, 2012

Mr. Jean-Luc Harel appointed as Director on August 16, 2012

Mr. Khemlall Rampersad appointed as Director on March 1, 2013

Alteo Milling Ltd (formerly F.U.E.L Sugar Milling Company Limited)

Mr. Jan Boullé resigned as Director on August 16, 2012

Mrs. Anne Rogers resigned as Director on August 16, 2012

Mr. Robert Lagesse resigned as Director on August 16, 2012

Mr. Dayanidhi Gujadhur resigned as Director on August 16, 2012

Mr. Marcellino Eustasie resigned as Director on March 20, 2013

Mr. Bissoon Mungroo resigned as Director on March 20, 2013



Mr. Jean-Pierre Dalais appointed as Director on August 16, 2012


Mr. Hastadeo Aucharaz appointed as Director on March 20, 2013

Mr. Youlaganaden Maunick appointed as Director on March 20, 2013

Alteo Planters Services Ltd (formerly FSMC Planters Services Co Ltd)


Alteo Refinery Ltd (formerly FUEL Refinery Limited)




page



Sucrière des Mascareignes Ltd

Mr. Christian Dalais resigned as Director on November 22, 2012

Mr. Patrick de L. d’Arifat appointed as Director on January 9, 2013

Mr. Arnaud Lagesse appointed as Alternate Director to Mr. Jean-Claude Harel on January 9, 2013

Sukari Investment Company Limited

Mr. G. Christian Dalais resigned as Director on November 22, 2012

Mr. Patrick de L. d’Arifat appointed as Director on January 9, 2013

Mr. Arnaud Lagesse appointed as Alternate Director to Mr. Jean-Claude Harel on January 9, 2013

TPC Ltd

Mr. Jean-Pierre Dalais resigned as Director on August 20, 2012

Mr. Jean-Claude Harel appointed as Director on August 22, 2012

Mr. Robert Baissac appointed as Director on August 22, 2012

Mr. Arnaud Lagesse appointed as Alternate Director to Mr. Jean-Claude Harel on August 22, 2012

Trianon Estates Limited


West East Limited




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76


Consolidated Energy Co. Ltd

Mr. Thierry Lagesse appointed as Director on September 3, 2012

Mr. Jean-Luc Harel appointed as Director on September 3, 2012

Mr. Joseph Claude Mamet resigned as Alternate Director to Mr. William Ah Sue on June 11, 2013

Mr. Clement Rey appointed as Alternate Director to Mr. Jean Ribet on September 12, 2012

Mrs. Carine Barbara Ah Sue appointed as Alternate Director to Mr. William Ah Sue on June 17, 2013

Constance La Gaieté Milling Company Limited

Mr. Gilbert Legand resigned as Director on December 3, 2012

Deep River-Beau Champ Milling Company Limited

Mr. Thierry Lagesse appointed as Director on September 3, 2012

Mr. Jean-Luc Harel appointed as Director on September 3, 2012

Mr. Thierry Desire Laval Govinden appointed as Director on March 20, 2013

Mr. Clement Rey appointed as Alternate Director to Mr. Jean Ribet on September 12, 2012

Island Fresh Ltd


Sena Development Ltd




Société Beauregard

Mrs. Anne Rogers resigned as Director on August 16, 2012

Mr. J. Cyril Lagesse resigned as Director on November 21, 2012

Mr. Robert Lagesse resigned as Director on November 21, 2012

Mr. Jean-Claude Harel resigned as Director on April 17, 2013

Mr. P. Arnaud Dalais appointed as Director on November 21, 2012

Mr. Patrick de L. d’Arifat appointed as Director on November 21, 2012

Mr. Jean-Claude Béga appointed as Director on April 17, 2013


page

79COMPANY SECRETARY’S

CERTIFICATEIn our capacity as Company Secretary, we hereby confirm that, to the best of our knowledge and belief, the Company has lodged with the Registrar of Companies, as at June 30, 2013, all such returns as are required for a company in terms of the Companies Act 2001, and that all such returns are true, correct and up to date.

Nathalie Gallet, ACISFor Navitas Corporate Services Ltd Company Secretary

September 20, 2013

Alteo Limited - ANNUAL REPORT 2013Alteo Limited - ANNUAL REPORT 2013

page

78


page

81INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS

Report on Other Legal and Regulatory Requirements

Companies Act 2001

We have no relationship with, or interests in, the Company or any of its subsidiaries, other than in our capacity as auditors, tax and 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.

Financial Reporting Act 2004

The directors are responsible for preparing the Corporate Governance Report. Our responsibility is to report on the extent of compliance with the Code of Corporate Governance as disclosed in the annual report and whether the disclosure is consistent with the requirements of the Code.

In our opinion, the disclosure in the annual report is consistent with the requirements of the Code.

BDO & Co Shabnam Peerbocus, FCAChartered Accountants Licensed by FRC

Port Louis, Mauritius.

September 20, 2013


page

80


INDEPENDENT AUDITORS’REPORT TO THE MEMBERSThis report is made solely to the members of Alteo 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 auditors’ 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.

Report on the Financial Statements

We have audited the group financial statements of Alteo Limited and its subsidiaries (the “Group”) and the Company’s separate financial statements on pages 82 to 149 which comprise the statements of financial position at June 30, 2013, the income statements, statements of comprehensive income, statements of changes in equity and statements of cash flows for the year then ended, and a summary of significant accounting policies and other explanatory notes.

Directors’ Responsibility for the Financial Statements

The directors are responsible for the preparation and fair presentation of these 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.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditors’ judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditors consider internal control relevant to the Company’s preparation and fair presentation of the financial statements 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 Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements on pages 82 to 149 give a true and fair view of the financial position of the Group and of the Company at June 30, 2013 and their financial performance and cash flows for the year then ended in accordance with International Financial Reporting Standards and comply with the Companies Act 2001.

page

83INCOME

STATEMENTSSTATEMENTS OFFINANCIAL POSITION

THE GROUP THE COMPANY Notes 2013 2012* 2013 2012* Rs’000 Rs’000 Rs’000 Rs’000

ASSETS EMPLOYEDNon-current assetsProperty, plant and equipment 5 16,420,306 7,113,194 11,609,836 4,459,566Land-projects 6 5,853 6,961 - -Investment properties 7 1,722,677 758,038 1,845,607 756,833Intangible assets 8 - 20,000 33,400 33,400Investment in subsidiary companies 10 - - 8,420,643 6,129,341Investment in joint ventures 11 985,420 663,469 1,043,206 1,021,999Investment in associated companies 12 46,392 126,954 37,677 -Investment in available-for-sale financial assets 13 139,605 52,931 117,632 36,977Bearer biological assets 15 552,678 328,006 317,968 117,054Non-current receivables 16 1,619 6,619 504,205 495,819Deferred expenditure 17 872,496 776,435 188,156 52,829Retirement benefit asset 28 3,355 2,922 - -Deferred tax assets 18 37,650 15,472 25,997 3,952

20,788,051 9,871,001 24,144,327 13,107,770

Current assetsDeferred expenditure 17 210,116 128,122 33,083 16,211Inventories 19 579,987 342,617 43,061 10,263Work in progress 20 181,761 67,720 - -Consumable biological assets 21 2,437,104 1,621,602 1,014,248 352,546Trade and other receivables 22 607,779 286,681 355,559 100,766Current tax assets 23 38,962 47,158 - -Short term deposits 39(b) 2,545 20,937 31,416 219Cash and cash equivalents 39(b) 412,993 105,152 209,346 2,584

4,471,247 2,619,989 1,686,713 482,589

Non-current assets classified as held for sale 9 171,249 - 37,700 39,000

Total assets 25,430,547 12,490,990 25,868,740 13,629,359

EQUITY AND LIABILITIESCapital and reservesShare capital 24 8,991,595 1,869,867 8,991,595 1,869,867Revaluation and other reserves 25 4,579,042 3,699,569 11,435,919 8,880,835Retained earnings 2,541,162 1,644,224 2,083,623 1,700,573

Owners’ interests 16,111,799 7,213,660 22,511,137 12,451,275Shareholders’ loans 26 55,951 44,488 - -Non-Controlling interests 2,322,890 1,488,796 - -

18,490,640 8,746,944 22,511,137 12,451,275

Non-current liabilitiesBorrowings 27 2,628,198 1,265,504 1,383,495 637,573Deferred income 30 59,780 56,668 - -Deferred tax liabilities 18 873,305 702,406 - -Retirement benefit obligations 28 356,003 200,512 220,705 103,821

3,917,286 2,225,090 1,604,200 741,394

Current liabilitiesTrade and other payables 29 1,287,164 672,585 993,701 165,121Deferred income 30 7,000 5,006 - -Current tax liabilities 23 25,070 4,535 5,269 -Borrowings 27 1,560,066 836,830 611,112 271,569Proposed dividend 31 143,321 - 143,321 -

3,022,621 1,518,956 1,753,403 436,690

Total equity and liabilities 25,430,547 12,490,990 25,868,740 13,629,359

The financial statements have been approved for issue by the Board of Directors on September 20, 2013:


The notes on pages 88 to 149 form an integral part of these financial statements. Auditors’ report on pages 80 and 81.*The comparative figures of the Group and the Company for the period June 2012 presented herewith are those of ex-Deep River-Beau

Champ and its subsidiaries only.


YEAR ENDED JUNE 30, 2013YEAR ENDED JUNE 30, 2013


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Turnover 32 6,066,307 3,673,435 1,234,311 377,937SIFB Compensation 912 37,491 847 24,392Gains arising from changes in fair value of biological assets 21 284,115 362,555 110,841 22,548Other operating income 33 247,045 89,501 223,021 73,556

6,598,379 4,162,982 1,569,020 498,433Operating expenses 34 (4,689,940) (2,761,519) (1,302,333) (529,010)

Operating profit/ (loss) 35 1,908,439 1,401,463 266,687 (30,577)Amortisation of VRS and centralisation costs (73,453) (21,471) (57,585) (21,471)Investment and other income 36 6,942 21,283 414,733 262,521Finance costs 37 (323,068) (190,546) (186,984) (62,235)Gain in fair value of investment property 7 108,971 - 141,927 -

1,627,831 1,210,729 578,778 148,238Impairment of investment in joint ventures 11 - - - (195,276)Impairment of investment in subsidiary 10 - - (20,000) (25,850)Impairment of goodwill on acquisition of subsidiary 8 (20,000) (24,382) - -Profit on disposal of land and investment property 61,796 - - -Gain on remeasuring to fair value the existing interest in associate 46,636 - - -Share of results of joint ventures 11 102,133 (12,806) - -Share of results of associates 12 2,182 15,220 - -

Profit/(loss) before taxation 1,820,578 1,188,761 558,778 (72,888)Income tax (charge)/credit 23 (413,015) (488,400) 63,141 3,071

Profit/(loss) for the year 1,407,563 700,361 621,919 (69,817)

Attributable to:- Owners of the parent 830,622 168,535 621,919 (69,817)- Non-Controlling interests 576,941 531,826 - -

1,407,563 700,361 621,919 (69,817)

Earnings per share 38 Rs 2.61 0.89 1.95 (0.39)

The notes on pages 88 to 149 form an integral part of these financial statements.

Auditors’ report on pages 80 and 81.

* The comparative figures of the Group and the Company for the period June 2012 presented herewith are those of ex-Deep River-Beau


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85STATEMENTS OF

CHANGES IN EQUITYSTATEMENTS OFCOMPREHENSIVE INCOME


Profit/(loss) for the year 1,407,563 700,361 621,919 (69,817)Other comprehensive incomeItems that will not be reclassified to profit or loss:Deferred tax on revaluation of land 18 - 687,938 - 687,938Gain on revaluation of land 5 1,368,474 - 1,335,518 -Fair value on transfer of property, plant and equipment - 12,596 - 12,596

Items that may be reclassified subsequently to profit or loss:Fair value on investment in subsidiaries 10 - - 519,821 4,869,462Fair value on investment in joint venture 11 - - 17,457 78,730Fair value on investment in associates - - 8,076 -Fair value on available-for-sale financial assets 13 (18,148) (6,983) (8,045) (5,711)Currency translation differences 3,339 208,886 - -Movement in reserves of associates and joint ventures (12,456) 18,317 - -

Other comprehensive income for the year 1,341,209 920,754 1,872,827 5,643,015

Total comprehensive income for the year 2,748,772 1,621,115 2,494,746 5,573,198

Attributable to:- Owners of the parent 2,169,545 972,855 2,494,746 5,573,198- Non-Controlling interests 579,227 648,260 - -

2,748,772 1,621,115 2,494,746 5,573,198







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THE GROUP

Attributable to owners of the parent

Revaluation Share- Non- Share and other Retained holders’ Controlling Total Notes Capital reserves Earnings Total Loans interests equity Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Balance at July 1, 2012 1,869,867 3,699,569 1,644,224 7,213,660 44,488 1,488,796 8,746,944Total comprehensive income for the year:- Profit or loss - - 830,622 830,622 - 576,941 1,407,563- Other comprehensive income - 1,338,923 - 1,338,923 - 2,286 1,341,209Loan received - - - - 11,463 - 11,463Movement in reserves - - 227,140 227,140 - - 227,140Consolidation adjustments - - 78,045 78,045 - 52,114 130,159Dividends 31 - - (238,869) (238,869) - (415,553) (654,422)Issue of shares 7,121,728 - - 7,121,728 - - 7,121,728Amalgamation adjustments - (459,450) - (459,450) - 618,306 158,856

Balance at June 30, 2013 8,991,595 4,579,042 2,541,162 16,111,799 55,951 2,322,890 18,490,640

Balance at July 1, 2011 93,600 3,783,329 2,485,461 6,362,390 44,637 1,162,021 7,569,048Received during the year - - - - 7,118 - 7,118Repaid during the year - - - - (7,267) - (7,267)Total comprehensive income for the year- Profit or loss - - 168,535 168,535 - 531,826 700,361- Other comprehensive income - 804,320 804,320 - 116,434 920,754Movement in reserves - - (9,350) (9,350) - - (9,350)Dividends 31 - - (112,235) (112,235) - (321,485) (433,720)Conversion premium (107) 107 - - - - -Bonus issue 24 1,776,374 (888,187) (888,187) - - - -

Balance at June 30, 2012 1,869,867 3,699,569 1,644,224 7,213,660 44,488 1,488,796 8,746,944

The notes on pages 88 to 149 form an integral part of these financial statements.Auditors’ report on pages 80 and 81.



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CASH FLOWS

THE COMPANY

Revaluation Share and other Retained Notes Capital reserves Earnings Total Rs’000 Rs’000 Rs’000 Rs’000

Balance at July 1, 2012 1,869,867 8,880,835 1,700,573 12,451,275Issue of shares 24 7,121,728 - - 7,121,728Amalgamation adjustments - 682,257 - 682,257Total comprehensive income for the year:-Profit or loss - - 621,919 621,919-Other comprehensive income - 1,872,827 - 1,872,827Dividends 31 - - (238,869) (238,869)

Balance at June 30, 2013 8,991,595 11,435,919 2,083,623 22,511,137

Balance at July 1, 2011 93,600 4,125,900 2,770,812 6,990,312Total comprehensive income for the year:-Profit or loss - - (69,817) (69,817)-Other comprehensive income - 5,643,015 - 5,643,015Dividends 31 - - (112,235) (112,235)Conversion premium (107) 107 - -Bonus issue 1,776,374 (888,187) (888,187) -

Balance at June 30, 2012 1,869,867 8,880,835 1,700,573 12,451,275

The notes on pages 88 to 149 form an integral part of these financial statements.Auditors’ report on pages 80 and 81.




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STATEMENTS OF CHANGES IN EQUITY



Operating activities Cash generated from operations 39(a) 2,335,853 1,646,340 705,482 64,534Interest received 4,978 18,583 3,725 2,833Interest paid (338,626) (176,801) (192,691) (71,213)Tax paid (358,775) (389,983) - -

Net cash from/(used in) operating activities 1,643,430 1,098,139 516,516 (3,846)

Investing activities Purchase of property, plant and equipment (620,149) (315,677) (115,280) (42,364)Investment in joint ventures (3,750) (9,300) (3,750) (9,300)Investment in associates (25,600) - (25,600) - Investment in securities - (235) - (235)Disposal of investment in available-for-sale financial assets 29,361 - - - Proceeds from sale of property, plant and equipment 154,066 41,553 44,042 1,511 Proceeds on disposal of investment property 431,462 - - -Investment in cane replantation (208,281) (131,178) (106,292) (34,460)Additions to deferred expenditure (150,291) (209,751) (109,693) (64,019)Loans (granted)/recovered 5,000 (3,750) 16,416 (4,163)Additions to deferred income 10,290 - - -Dividends received from subsidiaries - - 400,089 259,343 Dividends received from available-for-sale financial assets 1,964 2,700 4,169 345 Dividends received from associated companies 8,789 1,700 6,750 -

Net cash (used in)/from investing activities (367,139) (623,938) 110,851 106,658

Financing activities Proceeds from debentures 1,000,000 - 1,000,000 - Proceeds from borrowings 59,196 37,999 25,600 - Repayments of borrowing (1,494,650) (113,584) (1,155,938) (46,071)Shareholders’ loan 11,463 - - - Finance lease principal payments (15,283) (4,494) (6,858) (2,294)Dividends paid to minority shareholders (370,655) (302,177) - - Dividends paid to company’s shareholders (95,548) (169,331) (95,548) (169,331)

Net cash (used in)/from financing activities (905,477) (551,587) (232,744) (217,696)

Increase/(Decrease) in cash and cash equivalents 370,814 (77,386) 394,623 (114,884)

Movement in cash and cash equivalents At July 1, (263,694) (85,676) (182,184) (67,300)Increase/(decrease) 370,814 (77,386) 394,623 (114,884)Amalgamation adjustment (251,072) - (157,659) - Effect of non cash transaction 39(c) - (100,632) - -

At June 30, 39(b) (143,952) (263,694) 54,780 (182,184)





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2. SIGNIFICANT ACCOUNTING POLICIES (cont’d)

(a) Basis of preparation (cont’d)

Standards, Amendments to published Stan-dards and Interpretations issued but not yet effective (cont’d)

IFRIC 20 Stripping Costs in the Production Phase of a Surface Mine

Disclosures - Offsetting Financial Assets and Financial Liabilities (Amendments to IFRS 7)

IAS 32 Offsetting Financial Assets and Financial Liabilities (Amendments to IAS 32)

Amendment to IFRS 1 (Government Loans)

Annual Improvements to IFRSs 2009-2011 Cycle

Consolidated Financial Statements, Joint Arrangements and Disclosure of Interests in Other Entities:

Transition Guidance

Investment Entities (Amendments to IFRS 10, IFRS 12 and IAS 27)

IFRIC 21: Levies

Recoverable Amount Disclosures for Non- financial Assets (Amendments to IAS 36)

Novation of Derivatives and Continuation of Hedge Accounting (Amendments to IAS 39)

Where relevant, the Group is still evaluating the effect of these Standards, amendments to published Standards and Interpretations 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 group’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.

(b) Property, plant and equipment

All property, plant and equipment are initially recorded at cost. Land, buildings and plant and machinery are subsequently revalued. Freehold land has been revalued by Société D’hotman De Speville in October 2008 based on open market

value. The directors have valued the freehold land at 70% of the revalued amount. Factory building and plant and machinery have been revalued by directors in 1995, based on the recommendations of the Mauritius Sugar Authority. This has been treated as deemed cost. All other property, plant and equipment are subsequently stated at historical cost less depreciation, except for golf course which is not depreciated.

Subsequent costs are included in the assets’ carrying amounts. 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 the revaluation surplus; all other decreases are charged to the profit or loss.

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

The annual rates used are:

Buildings 2 - 5 %Agricultural equipment 5 - 20 %Motor Vehicles 10 - 25 %Plant & Machinery 5 - 20 %Power generation plant 4 - 10 %Furniture and Equipment 4 - 20 %Computer equipment 25%Land derocking project and land improvement 4 %Others 2 - 20 %

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 disposal of property, plant and equipment are determined by reference to their carrying amount and are taken into account in determining operating profit. On disposal of revalued assets, amounts in revaluation surplus relating to that asset are transferred to retained earnings.


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1. GENERAL INFORMATION

Alteo Limited is a limited liability company incorporated and domiciled in Mauritius. The address of its registered office is Vivéa Business Park, Saint Pierre. These financial statements will be submitted for consideration and approval at the forthcoming Annual Meeting of Shareholders of the Company.

On July 20, 2012 the Company amalgamated with Flacq United Estates Limited with the continuing company being Alteo Limited. Consequently, the amounts presented in the Group financial statements for the year ended June 30, 2013 are not entirely comparable with last year as a result of this amalgamation.

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.

(a) Basis of preparation

The financial statements of Alteo Limited and its subsidiaries (the”Group”) comply with the Companies Act 2001 and are prepared in accordance with International Financial Reporting Standards (IFRS).

Where necessary, comparative figures have been amended to conform with change 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 securities are stated at their fair value,

(iii) Consumable biological assets are stated at fair value,

(iv) Relevant financial assets and financial liabilities are carried at amortised cost,

(v) Investment property is stated at their fair value.

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

Deferred Tax: Recovery of Underlying Assets (Amendments to IAS 12), introduces a presumption that investment properties that are measured using the fair value model in accordance with IAS 40 Investment Property are recovered entirely through sale for the purposes of measuring deferred taxes. This presumption is rebutted if the investment property is held within a business model whose objective is to consume substantially all of the economic benefits embodied in the investment property over time, rather than through sale. This amendment is unlikely to have an impact on the Group’s financial statements.

Amendment to IAS 1, ‘Financial statement presentation’ regarding other comprehensive income. The main change resulting from these amendments is a requirement for entities to group items presented in ‘other comprehensive income’(OCI) on the basis of whether they are potentially reclassifiable to profit or loss subsequently (reclassification adjustments).

Standards, Amendments to published Stan-dards 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, 2013 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:

IFRS 9 Financial Instruments

IAS 27 Separate Financial Statements

IAS 28 Investments in Associates and Joint Ventures

IFRS 10 Consolidated Financial Statements

IFRS 11 Joint Arrangements

IFRS 12 Disclosure of Interests in Other Entities

IFRS 13 Fair Value Measurement

IAS 19 Employee Benefits (Revised 2011)

NOTES TO THEFINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2013

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Investments in associated companies are accounted for by the equity method.

Investment in associates are initially recorded 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. When the Group’s share of losses exceeds its interests in an associate, the Group discontinues recognising further losses, unless it has a legal or constructive obligation to make payments on behalf of the associate.

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

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.

(i) Investments in joint ventures

The Company

During the year, the Company changed its accounting policy in respect of its investment in joint ventures. Investment in joint ventures is now carried at fair value in the separate financial statements as opposed to cost in the preceding year. The carrying amount is reduced to recognise any impairment in the value of individual investments. The change in accounting policy has been applied prospectively as it is impracticable to recreate the information to determine the periodic-specific effects of the change in accounting policy on comparative information for the prior periods presented. The Company has therefore applied the new accounting policy to the carrying amount of assets as at the beginning of the current period.

The Group

Investments in joint ventures are accounted for by the equity method. Investment in joint ventures are initially recorded at cost as adjusted by post acquisition changes in the Group’s share of the net assets of the joint venture less any impairment in the value of individual investments. When the Group’s share of losses exceeds its interests in a joint venture, the Group discontinues recognising further losses, unless it has a legal or constructive obligation to make payments on behalf of the joint venture.


(g) Investment in subsidiaries(cont’d)

The Group (cont’d)

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 values of the assets transferred, the liabilities incurred and the equity interests issued by the group. The consideration transferred includes the fair value of any asset or liability 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 values at the acquisition date. On an acquisition-by-acquisition basis, the Group recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets.

The excess of the consideration transferred, the amount of any non-controlling interest in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the Group’s share 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 income statement.

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.

(h) Investments in associates

The Company

Investments in associated companies are carried at fair value. The carrying amount is reduced to recognise any impairment in the value of individual investments.

The Group

An associate is an equity over which the Group has significant influence but not control, or joint control.

NOTES TO THE FINANCIAL STATEMENTS - YEAR ENDED JUNE 30, 2013


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The Group

Non-current assets classified as held for sale represent sugar mill and inventories of fellow subsidiary. They are measured at the lower of carrying value 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.

(g) Investment in subsidiaries

The Company

During the year, the Company changed its accounting policy in respect of its investment in subsidiaries. Investment in subsidiaries is now carried at fair value in the separate financial statements as opposed to cost in the preceding year. The change in accounting policy has been applied prospectively as it is impracticable to recreate the information to determine the periodic-specific effects of the change in accounting policy on comparative information for the prior periods presented. The Company has therefore applied the new accounting policy to the carrying amount of assets as at the beginning of the current period. The carrying amount is reduced to recognise any impairment in the value of individual investments.

The Group

The consolidated financial statements incorporate the financial statements of the Company and enterprises controlled by the Company (its subsidiaries) made up to the financial period. Subsidiaries are all entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies generally accompanying a shareholding of more than one half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another 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.


(c) Land projects

Land projects represent the portion of land relating to the northern part of the IRS project of Anahita Estate Ltd which is yet to be developed as far as general infrastructure is concerned. It will be sold in the medium to long term once the southern portion are fully developed and sold. Land projects are initially recorded at cost. Gains on disposal are credited to the income statement.

(d) Investment properties

Investment properties, which are properties held to earn rentals, are stated at fair value subsequent to initial recognition. Changes in fair values are included in the income statement.

(e) Intangible assets

Intangible assets consist of land development rights and goodwill.

(i) Land development rights

Land development rights are shown at cost and tested annually for impairment.

(ii) Goodwill

Goodwill represents the excess of the cost of acquisition over the fair value of the Group’s share of net assets of the acquired entity at the date of acquisition. Goodwill is tested annually for impairment and carried at cost less accumulated impairment losses. On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gains and losses on disposal. Any net excess of the Group’s interest in the net fair value of acquiree’s net identifiable assets over cost is recognised in the income statement.

(f) Non-current assets held for sale

The Company

Non-current assets classified as held for sale represent lifetime golf memberships. They are measured at the lower of carrying value amount and fair value less costs to sell if their 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.


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condition, discounted at an appropriate discount rate to reporting date.

(n) Deferred Expenditure

Land development

Land development costs incurred are in respect of land to be sold. This expenditure is released to the income statement in proportion to the subsequent land disposal.

Current milling and crop expenses

Expenditure incurred in respect of direct factory repairs, maintenance works and operating expenses, the benefit of which will be derived in the subsequent crop season, has been accounted as deferred milling expenses.

Sugar Industry voluntary Retirement Scheme (vRS)

VRS (net of refunds under the Multi Annual Adaptation Scheme and pension obligations previously provided for) are carried forward and are amortised over a period of 6 years. The amortisation is reviewed and reassessed yearly to ascertain the adequacy of the yearly charge taking into account the right exercised.

Milling centralisation costs

Closure of Constance La Gaiete Sugar Factory

The compensation payments for centralisation in accordance with the provisions of the Blue Print relating to the closure of Constance La Gaiété Sugar Factory are recoverable from the sale proceeds of freehold land. Land development costs are capitalised and released against proceeds from the subsequent land disposal.

Closure of Mon Loisir Sugar Factory

Closure costs (net of refunds under the Multi Annual Adaptation Scheme and pension obligations previously provided for) are carried forward and are recoverable from the sale proceeds of freehold land.

Closure of Mon Desert Alma Sugar Factory

Closure costs (net of refunds under the Multi Annual Adaptation Scheme and pension obligations previously provided for) are carried forward and are amortised over a period of 6 years. The amortisation is reviewed and reassessed yearly to ascertain the adequacy of the yearly charge taking into account the right exercised.


( j) Financial instruments (cont’d)

(iv) Borrowings (cont’d)

Interest free loans from holding company are recorded at the proceeds received, net of direct costs. 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.

(v) Trade and other payables

Trade and other payables are stated at fair value and subsequently measured at amortised cost using the effective interest method.

(vi) Cash and cash equivalents

Cash and cash equivalents include cash in hand, deposits held at call with banks and related parties, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the statement of financial position.

(vii) Share capital

Ordinary share capital are recorded at the proceeds received, net of direct issue costs. Preference share capital is classified as equity if it is non-redeemable, or redeemable only at the Company’s option, and any dividends are discretionary.

(viii) Non-current receivable

Non-current receivable, without fixed repayment terms, is carried at cost.

(k) Deposit on investments

Deposit on investments is shown at cost.

(l) Bearer biological assets

Cane replantation costs are deferred at cost and amortised over 4 to 7 years.

Flower replantation costs are deferred at cost and amortised over 7 years.

(m) Consumable biological assets

Standing cane, flowers crop, palmhearts and pineapples have been measured at fair value. The fair value of the living plants held for sale is based on expected selling price and future direct costs to bring the biological assets to saleable



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Impairment

Financial assets classified as available-for-sale

The Company assesses at the end of each reporting period whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity investments classified as available-for-sale, a significant or prolonged decline in the fair value of the security below its cost is considered in determining whether the securities are impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss, measured as the difference between acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss - is removed from equity and recognised in profit or loss.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Group provides money, goods or services directly to a debtor with no intention of trading the receivable. They are included in current assets when maturity is within twelve months of reporting date or non-current assets for maturities greater than twelve months.

(iii) Trade and other receivables

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables.

The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of provision is recognised in the income statement.

(iv) Borrowings

Interest-bearing bank loans, debentures and overdrafts are recorded at the proceeds received, net of direct issue costs. Finance charges, including premiums payable on settlement or redemption, are accounted for on an accrual basis and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise.


(i) Investments in joint ventures (cont’d)

The Group (cont’d)

Unrealised profits and losses are eliminated to the extent of the Group’s interests in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the assets transferred. Where necessary, appropriate adjustments are made to the financial statements of joint ventures to bring the accounting policies used in line with those adopted by the group.

( j) Financial instruments

The Group’s accounting policies in respect of the main financial instruments are set out below:

(i) Investment in available-for-sale financial assets

Initial recognition

Investments are recognised on a trade-date basis and are initially measured at fair value plus transaction costs.

Subsequent recognition

Available-for-sale securities

Available-for-sale financial assets are measured at subsequent reporting dates at fair value. Unrealised gains and losses on such securities are recognised directly in equity (revaluation and other reserves - fair value reserve) until the security is disposed of or found to be impaired, at which time the cumulative gain or loss previously recognised in equity is included in profit or loss for the period.

Fair value

The fair value of publicly traded available-for-sale securities is based on their market value which is calculated by reference to the Stock Exchange and the DEM-listed prices at the close of business on reporting date.

If the market for a financial asset is not active, the group establishes fair value by using valuation techniques. These include the use of recent arm’s length transactions, reference to other investments that are substantially the same and discounted cash flows analysis.


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(v) Related parties

Related parties are individuals and companies where the individual or the company has the ability, directly or indirectly, to control the other party or exercise significant influence over the other party in making financial and operational decisions.

(w) Segment reporting

Segment information presented relate to the operating segments that engage in business activities for which revenues are earned and expenses incurred. The group’s customer is diversified, with no individually significant customer except for Sudzucker, through the Mauritius Sugar Syndicate and Central Electricity Board.

(x) Real Estate contracts

Contract costs are recognised when incurred.

Costs incurred in the year in connection with future activity on a contract are excluded from contract costs in determining the cost of sales. They are presented as deferred expenditure.

When the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised only to the extent of contract costs incurred that are likely to be recoverable.

The Group recognises revenue from real estate contracts on delivery when: significant risks and rewards of ownership of the real estate contracts have been transferred to the buyer; the Group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the real estate contracts; 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.

The Group presents as an asset the gross amount due from customers for contract work for all contracts in progress for which costs incurred plus recognised profits (less recognised losses) exceeds progress billings. Billings not yet paid by customers and retention are included within ‘trade and other receivables’.


(s) Retirement benefit obligations (cont’d)

Defined benefit plans (cont’d)

Cumulative actuarial gains and losses arising from experience adjustments, changes in actuarial assumptions and amendments to pension plans in excess of the greater of 10% of the value of the plan assets or 10% of the defined benefit obligation are spread to income over the average remaining working lives of the related employees.

All acturial gains and losses are recognised in the income statement.

Past-service costs are recognised immediately in income unless the changes to the pension plan are conditional on the employees remaining in service for a specified period of time (the vesting period). In this case, the past-service costs are amortised on a straight-line basis over the vesting period.

Defined contribution plans

The contributions to the Group’s other schemes, which are treated as defined contribution schemes, are charged to the income statement for the period in which they are incurred.

Gratuity on retirement

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

(t) Provisions

Provisions are recognised when the Group has a present or constructive obligation as a result of past events which it is probable will result in an outflow of economic benefits that can be reasonably estimated.

(u) Dividend distribution

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



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that future taxable profit will be available against which the unused tax losses can be utilised.

(r) Foreign currencies

(i) Functional and presentation currency

Items included in the financial statements 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 balances

Foreign currency transactions are accounted for at the exchange rates prevailing at the date of the transactions. Gains and losses resulting from settlement of such transactions and from the translation of monetary assets and liabilities are recognised in the income statement. Such balances are translated at year-end exchange rates.

(iii) Group companies

The results and financial position of all the Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:

(a) assets and liabilities are translated at the closing rate at the reporting date;

(b) income and expenses are translated at average exchange rates;

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

(s) Retirement benefit obligations

Defined benefit plans

A defined benefit plan is a pension plan that defines 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.

The Company and its subsidiaries contribute to a defined benefit plan for certain employees (and their dependants). The cost of providing benefits is determined using the Projected Unit Credit Method, so as to spread the regular cost over the service lives of employees in accordance with the advice of actuaries who carry out a full valuation of plans regularly.


(o) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined by the weighted average method. The cost of finished goods and work in progress comprises raw materials, direct labour, other direct costs and related production overheads but excludes interest expense. Net realisable value is the estimate of the selling price in the ordinary course of business less the costs of completion and selling expenses.

(p) Leases

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 the income statement on a straight-line basis over the period of the lease.

Finance leases-Where the Company is the lessee.

Finance leases are capitalised at the estimated present value of the underlying lease payments. Each lease payment is allocated between the liability and finance charges so as to achieve a constant rate on the finance balance outstanding. The corresponding rental obligations, net of finance charges, are included in other long-term payables. The interest element of the finance charge is charged to the income statement over the lease period. The property, plant and equipment acquired under finance leasing contracts is depreciated over the useful life of the asset.

(q) Deferred income tax

Deferred income tax is provided, using the liability method, for all temporary differences arising between the tax bases of assets and liabilities and their carrying values for financial reporting purposes.

The principal temporary differences arise from depreciation on property, plant and equipment, revaluation of certain non-current assets, provisions for retirement benefit obligations and tax losses carried forward. Deferred tax assets relating to the carry forward of unused tax losses are recognised to the extent that it is probable


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(iii) Cash flow and fair value interest rate risk

As the Group has no significant interest-bearing assets, its income and operating cash flows are substantially independent of changes in market interest rates. The Group’s interest rate risk arises from borrowings. Borrowings issued at variable rates expose the Group to cash flow interest-rate risk. At June 30, 2013, if interest rates on borrowings had been 50 basis points higher/lower with all other variables held constant, post-tax profit for the year would have been Rs.7,029,000(2012: Rs.3,510,000) lower/higher for the Company and Rs.16,426,000 (2012: Rs.8,784,000) lower/higher for the Group, mainly as a result of higher/lower interest expense on floating rate borrowings.

(b) Credit risk

The Group’s credit risk is mainly attributable to its trade receivables. For the sugar and energy sectors, the Group has a concentration of credit risk since its main customers are the Mauritius Sugar Syndicate and the Central Electricity Board.

The Group does not expect any losses from non-performance of the latter since they are reputable institutions. Other group companies have no significant concentration of credit risk, with exposure spread over a large number of counterparties and customers. The Group has policies in place to ensure that sales of products and services are made to customers with an appropriate credit history and to limit the amount of credit exposure to any one financial institution.

(c) Liquidity risk

Prudent liquidity risk management implies maintaining sufficient cash marketable funding through an adequate amount of committed credit facilities. 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.

3. FINANCIAL RISK MANAGEMENT (cont’d)

3.1 Financial Risk Factors (cont’d)

(a) Market risk (cont’d)

(ii) Price risk

The Group is exposed to equity securities price risk because of investments in financial assets held by the Group and classified as available-for-sale.

The Group is also exposed to price risk with the incidence of the price of sugar on the European Union market.

To manage its price risk arising from investments in equity securities, the Group diversifies its portfolio.

Sensitivity analysis

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%.

Impact on equity


Categories of investments:

Available-for-sale 6,980 2,647 5,882 1,849



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unwinding the discount as interest income. Interest income on impaired loans is recognised either as cash is collected or on a cost-recovery basis as conditions warrant.

(aa) Merger of entities under common control

Merger with wholly-owned subsidiary is accounted on the effective date of amalgamation. The assets and liabilities amalgamated are recognised at the carrying amounts at the date of amalgamation. The difference between the assets and, liabilities and reserves, of the subsidiary is recorded in equity.

3. FINANCIAL RISK MANAGEMENT

3.1 Financial Risk Factors

The Group’s activities expose it 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.

A description of the significant risk factors is given below together with the risk management policies applicable.

(a) Market risk

(i) Currency risk

The Company exports its entire production through the Mauritius Sugar Syndicate and is exposed to currency risk due to fluctuations in the price of sugar and the incidence of the exchange rate, as sugar is initially paid in foreign currency to the Mauritius Sugar Syndicate. This will affect the sugar proceeds. Other group companies operate internationally and are exposed to foreign exchange risk arising from primarily the Euro, the US Dollar and the Tanzanian Shilling.

At June 30, 2013, if the Rupee had weakened/strenghthened by 5% against the US Dollar and the Euro with all other variable held constant, post tax profit and equity would have been Rs.1,564,710 (2012: Rs.120,000) higher/ lower for the Company and Rs.15,847,000 (2012: Rs.15,346,000) lower/higher for the Group following changes in foreign exchange gains/losses on translation of US Dollar and Euro denominated trade receivables, trade payables and borrowings.


(y) Impairment of non-financial assets

Assets that have an indefinite useful life are not subject to amortisation and 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. An 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 purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units).

(z) Turnover

Turnover represents the gross proceeds of sugar, molasses, bagasse, sale of ‘IRS’ residences, golf revenue, deer farming and other agricultural products and income receivable for the supply of electricity to the National Grid of the Central Electricity Board.

Turnover is net of value added tax less discounts, allowances and returns after eliminating sales within the group companies. Sale of goods and services are recognised when goods are delivered and title has passed. Sale of services are recognised in the accounting year in which the services are rendered.

Sugar and molasses proceeds are recognised on total production of the crop year. Bagasse proceeds are accounted on a cash basis. Sugar and molasses prices are based on prices recommended by the Mauritius Chamber of Agriculture for the crop year.

Other revenues earned by the Group are recognised on the following basis:

Dividend income - when the shareholders’ right to receive payment is established.

SIFB compensation - on a cash basis.

Interest income - on a time-proportion basis using the effective interest method. When a receivable is impaired, the Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at original effective interest rate, and continues


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3.2 Capital risk management

The Group’s objective when managing capital is to safeguard its 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 or sell assets to reduce debt.

Consistently with others in the industry, the Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt over total of adjusted capital and net debt. Net debt is calculated as total debt (as shown in the statement of financial position) less cash in hand and at bank and short term deposits, adjusted capital comprises all components of equity (i.e. share capital, retained earnings and reserves).

The gearing ratios at June 30, 2013 and at June 30, 2012 were as follows:


Total debt 4,188,264 2,102,334 1,994,607 909,142Less: cash in hand and at bank and shortterm deposits (415,538) (126,089) (240,762) (2,803)

Net debt 3,772,726 1,976,245 1,753,845 906,339

Shareholders’ interests 16,111,799 7,213,660 22,511,137 12,451,275

Gearing Ratio 0.19 0.22 0.07 0.07

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 primarily quoted equity investments classified as trading securities or available-for-sale.

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 values. 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 the incidence of exchange rate. The risk affects both the crop proceeds and the fair value of biological assets.The risk is not hedged.



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3.1 Financial Risk Factors (cont’d)

(c) Liquidity risk (cont’d)

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 GROUP

Less than Between 1 Between 2 1 year and 2 years and 5 years Over 5 years Rs’000 Rs’000 Rs’000 Rs’000

At June 30, 2013Loan at call 125,102 - - -Trade and other payables 1,287,164 - - -Bank borrowings 1,214,855 526,412 1,069,072 161,250Debentures 200,000 - 800,000 -Finance leases 20,109 18,826 51,089 1,549

At June 30, 2012Loan at call 92,419 - - -Trade and other payables 734,259 - - -Bank borrowings 740,229 273,410 697,752 281,121Finance leases 4,182 4,279 8,943 -

THE COMPANY

Less than Between 1 Between 2 1 year and 2 years and 5 years Over 5 years Rs’000 Rs’000 Rs’000 Rs’000

At June 30, 2013Loan at call 181,744 - - -Trade and other payables 993,701 - - -Bank borrowings 217,864 137,003 292,996 123,215Debentures 200,000 - 800,000 -Finance lease liabilities 11,504 9,636 20,645 -

At June 30, 2012Loan at call 92,530 - - -Trade and other payables 165,121 - - -Bank borrowings 176,169 121,572 272,680 232,857Finance lease liabilities 2,870 3,149 7,315 -


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4.8 Revaluation of property, plant and equipment and investment properties

The Group carries its investment properties at fair value, with changes in fair value being recognised in the statement of comprehensive income. In addition, it measures land and buildings 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 June 30, 2013. For the investment property the valuer used a valuation technique based on a discounted cash flow model as there is a lack of comparable market data because of the nature of the property.

4. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

4.6 Investment in growing and milling entities

IAS 36 requires the Group to assess whether there is any indication that its assets may be impaired. An asset is impaired if its carrying amount exceeds its recoverable amount, measured as the higher of the asset’s fair value less cost to sell and its value in use.

The value in use of milling assets is the present value of future cash flows/future economic benefits expected to be derived from the assets.

Accompanying measures have been provided by the European Union (EU) to ACP countries. The specific projects, in line with the Multi Annual Strategy Plan, presented by sugar entities to reduce costs and increase efficiency have been accepted by the EU. The Company, in line with the industry, started implementing such projects and in view of these plans for the future, there exists no evidence that milling assets are impaired.

4.7 Pension benefits

The present value of the pension obligations depend 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 liability.



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Consumable biological assets - Standing Canes and Flower Plants

The fair value of consumable biological assets has been arrived at by discounting the present value of expected net cash flows from standing canes and flower plants at the relevant market determined pre-tax rate.

The expected cash flows from standing canes 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. For flower plants, palm hearts and pineapples, the expected cash flows have been computed by estimating the sales proceeds from the number of saleable flower plants, palm trees and pineapples currently in cultivation. The harvesting costs and other direct expenses are based on the yearly budgets of the Group.

4.4 Other investments - Available for sale

Level 3 Available-for-sale investments are stated at cost since no reliable estimate could be obtained to compute the fair value of these securities. The directors used their judgement at year-end and reviewed the carrying amount of these investments and in their opinion there were no material difference between the carrying amount and the fair value of the unquoted securities. To their judgement, the carrying amount reflect the fair value of these investments.

4.5 Depreciation policies

Property, 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 Company would currently obtain from 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 in historical experience and use 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

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.

Critical accounting estimates and assumptions

The Group make 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.

4.1 Impairment of available-for-sale financial assets

The Group follow the guidance of IAS 39 on determining when 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.

4.2 Estimated impairment of intangible assets

The Group tests annually whether intangible assets have suffered any impairment, in accordance with the accounting policy stated in note 2(e). These calculations require the use of estimates.

4.3 Biological assets

Bearer biological assets

Bearer biological assets have been estimated based on the cost of land preparation and planting of bearer canes and flower seeds.


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5. PROPERTY, PLANT AND EQUIPMENT Land Expansion Leasehold Plant Power Furniture Improvement Project and Freehold Land & Agricultural Motor vehicles and Machinery Generation and Computer and Derocking Work in Land Buildings Equipment Owned Leased Owned Leased Plant Equipment Equipment Project Golf course Progress Total

THE GROUP Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

(a) COST AND vALUATION At June 30, 2012 Cost/Deemed cost 60,724 890,061 400,106 381,093 84,332 1,595,203 - 707,872 515,313 40,620 310,494 376,324 74,945 5,437,087 Valuation 4,036,434 4,250 - - - - - - - - - - - 4,040,684

4,097,158 894,311 400,106 381,093 84,332 1,595,203 - 707,872 515,313 40,620 310,494 376,324 74,945 9,477,771 Amalgamation adjustment 5,629,418 752,650 320,072 282,324 24,448 2,398,498 - 802,982 36,599 8,153 7,597 2,252 - 10,264,993 Additions 23,860 53,144 16,355 8,560 33,099 98,968 28,169 100,719 4,701 431 20,431 - 297,005 685,442 Disposals (56,147) (9,933) (5,857) (37,476) (2,037) - - - (130) - - - - (111,580) Transfers - 41,991 - 35,388 - 98,906 - - 30,669 2,688 - - (209,642) - Transfers to NCA Held-for-Sale - (67,564) (3,499) - - (871,883) - - - - - - - (942,946) Transfer to Investment Properties (51,456) - - - - - - - - - - - - (51,456) Transfer from Investment Properties 91,171 91,171 Revaluations 1,368,474 - - - - - - - - - - - - 1,368,474 Exchange differences - 34,094 - (5,247) - 32,790 - - (6,488) (119) - - (1,300) 53,730

At June 30, 2013 Cost/Deemed cost 991,008 1,694,443 727,177 664,642 139,842 3,352,482 28,169 1,611,573 580,663 51,773 338,522 378,576 161,008 10,719,878 Valuation 10,111,470 4,250 - - - - - - - - - - - 10,115,720

11,102,478 1,698,693 727,177 664,642 139,842 3,352,482 28,169 1,611,573 580,663 51,773 338,522 378,576 161,008 20,835,598

DEPRECIATION At July 1, 2012 - 234,349 351,438 261,664 33,415 683,960 - 422,353 228,191 27,590 121,617 - - 2,364,577 Amalgamation adjustment - 136,908 209,427 224,060 2,442 1,386,550 - 465,966 30,693 2,783 - 676 - 2,459,505 Charge for the year - 41,413 27,064 64,567 8,911 206,907 172 50,205 30,100 7,229 13,023 113 - 449,704 Disposal adjustments - (4,589) (5,667) (36,788) (2,037) - - - (51) - - - - (49,132) Transfers - (1,417) - - - 1,417 - - (1,448) 1,448 - - - - Transfers to NCA Held-for-Sale - (56,532) (2,905) - - (747,388) - - - - - - - (806,825) Exchange differences - 699 - (3,581) - 3,189 - - (2,512) (332) - - - (2,537)

At June 30, 2013 - 350,831 579,357 509,922 42,731 1,534,635 172 938,524 284,973 38,718 134,640 789 - 4,415,292

NET BOOK vALUES At June 30, 2013 Rs 11,102,478 1,347,862 147,820 154,720 97,111 1,817,847 27,997 673,049 295,690 13,055 203,882 377,787 161,008 16,420,306

(i) Freehold land has been revalued by Société D’Hotman De Speville in June 2013 based on open market value. The directors have

valued the freehold land at 70% of the revalued amount.(2012: 67% of the revalued amount)

The revaluation surplus was credited to revaluation surplus.

(ii) Factory building and plant and machinery have been revalued by directors in 1995, based on the recommendations of the

Mauritius Sugar Authority. The revaluation was done for the purpose of transferring assets to milling companies.

This has been treated as deemed cost.

(iii) Borrowings are secured by floating charges on the asset of the group, including property, plant and equipment (note 27).

(iv) The depreciation charge for the year has been charged to operating expenses.

(v) If the freehold land was stated on the historical cost basis, the amounts would be as follows:

2013 2012

Rs’000 Rs’000

Cost 991,008 60,724



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5. PROPERTY, PLANT AND EQUIPMENT (cont’d)

THE GROUP

Land Expansion Leasehold Plant Power Furniture Improvement Project and Freehold Land & Agricultural Motor vehicles and Machinery Generation and Computer and Derocking Work in Land Buildings Equipment Owned Leased Leased Plant Equipment Equipment Project Golf course Progress Total Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

(b) COST AND vALUATION

At July 1, 2011

Cost/Deemed cost 60,724 741,540 362,308 292,582 66,734 1,492,218 680,150 435,507 31,189 297,422 376,324 55,305 4,892,003

Valuation 4,036,527 4,250 - - - - - - - - - - 4,040,777

4,097,251 745,790 362,308 292,582 66,734 1,492,218 680,150 435,507 31,189 297,422 376,324 55,305 8,932,780

Additions - 22,016 38,500 1,389 18,233 825 27,722 3,397 899 13,072 - 203,590 329,643

Disposals (93) - (702) (6,840) (635) - - (32) - - - - (8,302)

Transfers - 92,523 - 60,192 - - - 33,374 5,261 - - (191,350) -

Exchange differences - 33,982 - 33,770 - 102,160 - 43,067 3,271 - - 7,400 223,650

At June 30, 2012

Cost/Deemed cost 60,724 890,061 400,106 381,093 84,332 1,595,203 707,872 515,313 40,620 310,494 376,324 74,945 5,437,087

Valuation 4,036,434 4,250 - - - - - - - - - - 4,040,684

4,097,158 894,311 400,106 381,093 84,332 1,595,203 707,872 515,313 40,620 310,494 376,324 74,945 9,477,771

DEPRECIATION

At July 1, 2011 - 201,251 315,097 206,869 24,284 608,880 383,704 179,302 18,460 109,757 - - 2,047,604

Charge for the year - 23,697 37,043 38,997 9,766 46,416 38,649 32,960 5,923 11,860 - - 245,311

Disposal adjustments - - (702) (6,836) (635) - - (32) - - - - (8,205)

Exchange differences - 9,401 - 22,634 - 28,664 - 15,961 3,207 - - - 79,867

At June 30, 2012 - 234,349 351,438 261,664 33,415 683,960 422,353 228,191 27,590 121,617 - - 2,364,577

NET BOOK vALUES

At June 30, 2012 Rs 4,097,158 659,962 48,668 119,429 50,917 911,243 285,519 287,122 13,030 188,877 376,324 74,945 7,113,194



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THE COMPANY

Furniture Land Freehold Agricultural Motor vehicles and Improvement Land Buildings Equipment Owned Leased Fittings and Derocking Total Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

(d) COST AND vALUATION

At July 1, 2011

Cost/Deemed cost 44,926 84,272 153,159 135,473 3,835 23,082 330,621 775,368

Valuation 4,034,123 - - - - - - 4,034,123

4,079,049 84,272 153,159 135,473 3,835 23,082 330,621 4,809,491

Additions - 18,739 4,580 - 18,233 625 13,072 55,249

Disposals (93) - (702) (3,511) - (32) - (4,338)

At June 30, 2012

Cost/Deemed cost 44,926 103,011 157,037 131,962 22,068 23,675 343,693 826,372

Valuation 4,034,030 - - - - - - 4,034,030

4,078,956 103,011 157,037 131,962 22,068 23,675 343,693 4,860,402

DEPRECIATION

At July 1, 2011 - 27,313 131,799 80,773 767 18,843 109,342 368,837

Charge for the year - 1,775 13,355 - 8,018 1,305 11,791 36,244

Disposal adjustments - - (702) (3,511) - (32) - (4,245)

At June 30, 2012 - 29,088 144,452 77,262 8,785 20,116 121,133 400,836

NET BOOK vALUES

At June 30, 2012 Rs 4,078,956 73,923 12,585 54,700 13,283 3,559 222,560 4,459,566



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THE COMPANY

Furniture Land Freehold Agricultural Motor vehicles and Improvement Land Buildings Equipment Owned Leased Fittings and Derocking Total Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

(c) COST AND vALUATION At June 30, 2012 Cost/Deemed cost 44,926 103,011 157,037 131,962 22,068 23,675 343,693 826,372 Valuation 4,034,030 - - - - - - 4,034,030

4,078,956 103,011 157,037 131,962 22,068 23,675 343,693 4,860,402 Amalgamation

adjustment 5,556,767 95,189 316,573 265,309 - 35,654 7,597 6,277,089 Additions 23,860 45,528 16,355 3,838 33,238 4,701 20,431 147,951 Transfer to investment

properties (51,456) - - - - - - (51,456) Revaluation 1,335,518 - - - - - - 1,335,518 Disposals (6,727) - (5,857) (19,906) - - - (32,490)

At June 30, 2013 Cost/Deemed cost 949,760 243,728 484,108 381,203 55,306 64,030 371,721 2,549,856 Valuation 9,987,158 - - - - - - 9,987,158

10,936,918 243,728 484,108 381,203 55,306 64,030 371,721 12,537,014

DEPRECIATION At July 1, 2012 - 29,088 144,452 77,262 8,785 20,116 121,133 400,836 Amalgamation

adjustment - 28,903 206,522 212,889 - 29,776 - 478,090 Charge for the year - 5,830 27,064 20,361 4,611 2,406 12,954 73,226 Disposal adjustments - - (5,667) (19,307) - - - (24,974)

At June 30, 2013 - 63,821 372,371 291,205 13,396 52,298 134,087 927,178

NET BOOK vALUES At June 30, 2013 Rs. 10,936,918 179,907 111,737 89,998 41,910 11,732 237,634 11,609,836

(i) Freehold land has been revalued by Société D’Hotman De Speville in June 2013 based on open market value. The directors have valued the freehold land at 70% of the revalued amount.(2012: 67% of the revalued amount). The revaluation surplus was credited to revaluation surplus.

(ii) Factory building and plant and machinery have been revalued by directors in 1995, based on the recommendations of the Mauritius Sugar Authority. The revaluation was done for the purpose of transferring assets to milling companies. This has been treated as deemed cost.

(iii) Borrowings are secured by floating charges on the asset of the group, including property, plant and equipment (note 27).

(iv) The depreciation charge for the year has been charged to operating expenses.

(v) If the freehold land was stated on the historical cost basis, the amounts would be as follows:

2013 2012

Rs’000 Rs’000

Cost 949,760 44,926


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7. INvESTMENT PROPERTIES (cont’d)

THE COMPANY (cont’d)

(i) Rental income from investment property amounted to Rs.1,997,000 (2012: Rs Nil). No direct operating expenses were incurred on the investment property during the year (2012: Rs Nil).

(ii) Investment properties have been revalued by Société D’Hotman De Speville in June 2013 based on open market value. The directors have valued the freehold land at 70% of the revalued amount.

(iii) Borrowings are secured by floating charges on the asset of the group, including investment properties (note 27).

8. INTANGIBLE ASSETS

2013 2012 THE GROUP Rs’000 Rs’000

Goodwill on acquisition of subsidiaries At July 1, 20,000 44,382 Impairment (8(a)) (20,000) (24,382)

At June 30, - 20,000

(a) The impairment is as a result of the reduction of investment in World Tropicals Limited to its expected recoverable amounts.

2013 & 2012 THE COMPANY Rs’000

Acquisition of land development rights 33,400

In 2005, the company purchased land development rights on 15 hectares from its subsidiary company, Deep River Beau Champ Milling Company Limited. There is no time limit to utilise those land development rights.

9. NON-CURRENT ASSETS HELD FOR SALE

THE GROUP 2013 Rs’000

Sugar mill 136,121 Inventories 35,128

171,249

The group intends to dispose of the sugar mill and inventories in the near foreseeable future. Lifetime golf memberships 2013 & 2012 THE COMPANY Rs’000

At July 1, 2012 39,000 Disposal (1,300)

At June 30, 2013 37,700

The Company has purchased lifetime golf memberships and intends to sell these to villa owners as part of land projects.



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6. LAND-PROJECTS

2013 2012 THE GROUP Rs’000 Rs’000

At July 1, 6,961 6,961 Transfer to work in progress (1,108) -

At June 30, 5,853 6,961

Land-projects represent the portion of land relating to the northern part of the IRS project of Anahita Estates Ltd which is yet to be developed as far as general infrastructure is concerned.It will be sold in the medium to long term once the southern portion is fully developed and sold.

Borrowings are secured by floating charges on the assets of the group, including land-projects (note 27).

7. INvESTMENT PROPERTIES

Land and Buildings

2013 2012 Rs’000 Rs’000

(a) THE GROUP FAIR vALUE At July 1, 758,038 758,038 Amalgamation adjustment 1,296,708 - Transfer from property, plant and equipment (note 5(a)) 51,456 - Transfer to property, plant and equipment (note 5(a)) (91,171) - Depreciation (8) - Disposal (401,317) - Revaluation gain 108,971 -

At June 30, 1,722,677 758,038

(i) Rental income from investment property amounted to Rs 2,410,000 (2012: Rs 1,128,093). No direct operating expenses were incurred on the investment property during the year (2012: Rs Nil). .

(ii) Investment properties have been revalued by Société D’Hotman De Speville in June 2013 based on open market value. The directors have valued the freehold land at 70% of the revalued amount.

(iii) Borrowings are secured by floating charges on the asset of the group, including investment properties (note 27).

Land and Buildings

2013 2012 Rs’000 Rs’000

(b) THE COMPANY FAIR vALUE At July 1, 756,833 756,833 Amalgamation adjustment 895,391 - Transfer from property, plant and equipment (note 5(c) ) 51,456 - Revaluation gain 141,927 -

At June 30, 1,845,607 756,833


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. Alteo Milling Co Ltd Ordinary Rs’000 177,497 Sugar Milling 65.10 - - -

. Island Fresh Limited Ordinary Rs’000 1,850 Poultry Framing 100.00 - - -

. West East Limited Ordinary Rs’000 90,000 Treasury 99.99 - - -

. Société Beauregard Ordinary Rs’000 7,459 Rental of 100.00 - - - equipment

. Société Ducomet Ordinary Rs’000 46,000 Real Estate - 99.99 - -

. Société Gonin Ordinary Rs’000 46,000 Real Estate - 99.99 - -

. Compagnie Usiniere Ordinary Rs’000 217,328 Real Estate - 65.10 - - de Mon Loisir Ltee

. Trianon Estates Limited Ordinary Rs’000 4,128 Sugar Growing - 99.89 - -

. Sena Development Ordinary Rs’000 - Investment 57.15 - - -

Limited Holding

. Compagnie de Ordinary Rs’000 7 Estate 85.72 - - - la Vigie Limitee Management

. Schoenfeld Co Ltd Ordinary Rs’000 25 Real Estate 100.00 - - -

. Alteo Planters Services Ordinary Rs’000 25 Cane - 65.10 - - Company Ltd Harvesting

. Flagstone Property Ordinary Rs’000 25 Property - 100.00 - - Management Limited Management

(b) The financial statements of all above subsidiaries, included in the consolidated financial statements, are co-terminous with those of the holding company. Except for TPC Ltd, which is incorporated in the Republic of Tanzania and for Sena Development Limited which is incorporated in Mozambique, all the subsidiary companies are incorporated in the Republic of Mauritius.

(c) Although the Group holds less than 51% in Consolidated Energy Co Ltd and TPC Ltd, the Group has the power to govern the financial and operating policies of the entities so as to obtain benefits from their activities.

11. INvESTMENT IN JOINT vENTURES

2013 2012 Rs’000 Rs’000

(a) THE GROUP

At July 1, 663,469 640,513 Additions 3,750 9,300 Transfer from deposit on investments (note 14) - 15,500 Share of result for the year 102,133 (12,806) Consolidation adjustments 112,310 - Share of movement in hedge reserve (13,114) 4,579 Share of movement in other reserves 116,872 6,383

At June 30, 985,420 663,469

10. INvESTMENT IN SUBSIDIARY COMPANIES (cont’d) 2013 2012 Effective Effective percentage percentage holding holding Type of held held held held Company shares held Stated capital Activity Directly Indirectly Directly Indirectly



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10. INvESTMENT IN SUBSIDIARY COMPANIES

2013 2012 THE COMPANY Rs’000 Rs’000

FAIR vALUE At July 1, 6,129,341 459,631 Amalgamation adjustment 1,544,156 - Additions - 826,098 Transferred from associated companies (note 12) 247,325 - Impairment (10(a)) (20,000) (25,850) Fair value movement 519,821 4,869,462

At June 30, 8,420,643 6,129,341

(a) The impairment relates to the investment in World Tropicals, which has been reduced to its expected recoverable amount.

The following companies are subsidiaries of Alteo Limited: 2013 2012 Effective Effective percentage percentage holding holding Type of held held held held Company shares held Stated capital Activity Directly Indirectly Directly Indirectly

. Anahita Estates Ordinary Rs’000 826,123 Real Estates 100.00 - 100.00 -

Limited Development

. Anahita Golf Ltd Ordinary Rs’000 528,584 Golf - 61.00 - 61.00

. Anahita World Class Ordinary Rs’000 10 Trademark - 100.00 - 100.00

Sanctuary Ltd Owner

. Commercial and Industrial Ordinary Rs’000 48,400 Investment 100.00 - 100.00 -

Entreprises Limited

. Consolidated Energy Ordinary Rs’000 200,000 Energy 13.13 31.25 13.13 31.25

Co Ltd

. Constance La Gaieté Ordinary Rs’000 7,438 Dormant - 52.15 - 52.15

Milling Company Limited

. Deep River Beau Champ Ordinary Rs’000 208,552 Sugar Milling - 52.15 - 52.15

Milling Company Limited

. Eastern Energy Company Ordinary Rs’000 101,250 Investment 61.72 - 61.72 -

Limited

. Microlab Limitée Ordinary Rs’000 2,000 Vitropropagation - 67.55 - 67.55

of flower plants

. Ferney Aquaculture Ordinary Rs’000 31,283 Sugar 99.99 - 99.99 -

Limited and Preference

. Refinest Limited Ordinary Rs’000 46,000 Investment 64.23 - 64.23 -

. Sucrière des Mascareignes Ordinary USD’000 7,000 Investment 60.00 - 60.00 - Ltd

. Sukari Investment Ordinary USD’000 9,936 Investment - 60.00 - 60.00Company Ltd

. TPC Ltd Ordinary TShs’000 3,326,897 Sugar - 45.00 - 45.00

. Usinest Limited Ordinary Rs’000 46 Investment 65.19 - 65.19 -

. World Tropicals Ltd Ordinary Rs’000 1,000 Flower Export - 100.00 - 100.00

. Alteo Refinery Ltd Ordinary Rs’000 1,000 Sugar Refinery 32.50 20.87 - 20.87

. Alteo Energy Ltd Ordinary Rs’000 120,000 Electricity 65.10 - - -


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11. INvESTMENT IN JOINT vENTURES (cont’d)

(v) The following amounts represent the assets, liabilities, revenue and results of the joint ventures:

Flagstone Property Anahita Ciel Ciel et Mangement Hotel Properties Nature Novelife Limited Limited Limited* Limitée Limited* Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

2013 Assets 11,368 3,236,340 415,278 3,317 1,354,898 Liabilities 5,573 1,861,870 388,496 11,443 231,185 Revenues 11,304 491,339 252,412 5,690 109,637 Profit/(Loss) 3,387 69,472 (17,371) (1,840) 150,618

Share of profit/(loss) 1,694 34,736 (8,686) (920) 75,309

2012 Assets 6,630 3,342,402 418,004 5,726 934,394 Liabilities 4,296 2,020,280 364,747 12,012 241,877 Revenues 10,318 905,389 242,978 20,359 463,247 Profit/(Loss) 371 57,463 (28,927) (2,751) (104,416)

Share of profit/(loss) 186 28,731 (14,464) (1,375) (25,884)

* Group figures are presented for these companies.

12. INvESTMENT IN ASSOCIATED COMPANIES

2013 2012 Rs’000 Rs’000

(a) THE GROUP

(i) Group’s share of net assets 46,392 126,954

(ii) At July 1, 126,954 115,161 Amalgamation adjustment 12,651 - Addition 25,600 - Share of profit after taxation 2,182 15,220 Dividends (8,789) (1,700) Transfer to subsidiary companies (112,184) - Movement in reserves (22) (1,727)

At June 30, 46,392 126,954



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11. INvESTMENT IN JOINT vENTURES (cont’d)

2013 2012 Rs’000 Rs’000

(b) THE COMPANY

FAIR vALUE At July 1, 1,021,999 1,113,745 Additions 3,750 9,300 Transfer from deposit on investments (note 14) - 15,500 Fair value movement 17,457 78,730 Impairment - (195,276)

At June 30, 1,043,206 1,021,999

(c) The Company has effective interest in the following joint ventures. The financial statements used for all joint ventures are in respect of the year ended June 30, 2013.

2013 2012 Activity Name Direct Indirect Direct Indirect % % % %

Anahita Hotel Limited 50.00 - 50.00 - Hotel Operation Ciel Properties Limited 50.00 - 50.00 - Real Estate Development Flagstone Property Management - - - 50.00 Property management Limited(note 11(b)(iv)) Ciel et Nature Limitée 50.00 - 50.00 - Hospitality Anahita Centre for Excellence Training, social Limited (note 11(b)(i)) - 50.00 - 50.00 responsibility & empowerment

programme Anahita Residences & Villas Rental management Limited (note 11(b)(i)) - 50.00 - 50.00 Anahita IRS Forty Ltd (note 11(b)(ii)) - - - 50.00 IRS development Novelife Limited 50.00 - 50.00 - Investment in healthcare & life sciences Noveprim Limited (note 11(b)(iii)) - 25.00 - 25.00 Life sciences Noveprim Europe Ltd (note 11(b)(iii)) - 46.50 - 46.50 Life sciences

(i) Wholly owned subsidiaries of Ciel Properties Ltd.

(ii) Amalgamated with Anahita Hotel Limited on 31/12/2012.

(iii) Subsidiaries of Novelife Limited.

(iv) Flagstone Property Management Limited has become a subsidiary company at June 30, 2013.


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13. INvESTMENT IN AvAILABLE-FOR-SALE FINANCIAL ASSETS

THE GROUP THE COMPANY 2013 2012 2013 2012

Level 1 Level 3 Level 1 Level 3

DEM DEM

LISTED MARKET UNQUOTED TOTAL TOTAL LISTED MARKET UNQUOTED TOTAL TOTAL

Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

AVAILABLE-FOR-SALE

At July 1, - 42,450 10,481 52,931 59,679 - 35,271 1,706 36,977 42,453

Amalgamation

adjustment 1,770 94,647 20,070 116,488 73,684 - 15,016 88,700 -

Additions - - - - 235 - - - - 235

Disposals - (10,239) (11,098) (21,337) - - - - - -

Increase/(Decrease)

in fair value 2 (8,689) (9,461) (18,148) (6,983) (10,651) 2,687 (81) (8,045) (5,711)

Consolidation

adjustment - - 9,671 9,671 - - - - - -

At June 30, 1,772 118,169 19,663 139,605 52,931 63,033 37,958 16,641 117,632 36,977

All the investments are denominated in the Mauritian Rupee. None of the financial assets are either past due or impaired.

14. DEPOSIT ON INvESTMENTS


Joint ventures

At July 1, - 15,500 - 15,500 Additions - - - Transfer (note 11) - (15,500) - (15,500)

At June 30, - - - -



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2. INvESTMENT IN ASSOCIATED COMPANIES (cont’d)

2013 2012 Rs’000 Rs’000

(b) THE COMPANY

At July 1, - - Amalgamation adjustment 251,326 - Addition 25,600 - Transfer to subsidiary companies (note 10) (247,325) - Fair value movement 8,076 -

At June 30, 37,677 -

(b) The following amounts represent the assets, liabilities, revenue and results of the associated companies:

Proportion of effective Country of ownership Share of Name Year end incorporation Indirect Assets Liabilities Revenues Profit profit % Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

2013 Trois Ilots Limited June 30, Mauritius 33.33 51,875 9,462 25,354 6,276 2,092 Alcohol & Molasses

Export Limited June 30, Mauritius 28.12 53,489 17,651 229,494 14,542 4,089 volailles et

Traditions Ltée June 30, Mauritius 33.33 80,375 15,375 (467) (9,998) (3,999)

185,739 42,488 254,381 10,820 2,182

2012 Trois Ilots Limited June 30, Mauritius 33.33 52,744 8,432 18,966 3,891 1,297 Fuel Refinery

Limited (note 12(b) (ii)) June 30, Mauritius 20.87 1,262,720 725,307 287,235 66,696 13,923

1,315,464 733,739 306,201 70,587 15,220

(i) All of the above associated companies are incorporated in the Republic of Mauritius.

(ii) Fuel Refinery Limited became a subsidiary company on July 12, 2012.


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17. DEFERRED EXPENDITURE

THE GROUP Compensation payments

Closure of Closure of

Constance La Compagnie Blue Print

Gaiete Sugar Usinière de Costs

Factory Mon Loisir (Ex Fuel vRS 2 Land

(note 17(a)) (note 17(c)) Milling) (note 17(c)) Development 2013 2012

Non-current Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

At July 1, 85,547 - - 52,829 638,059 776,435 744,859

Amalgamation adjustment - - 15,868 26,992 259,282 302,142

Expenditure incurred

during the year - - - - 150,291 150,291 209,751

Additional provision made

during the year - 82,284 - 80,875 - 163,159

Transfer to statements of

comprehensive income - - - - (375,015) (375,015) (118,200)

Reversal of overprovision

made in previous years - - - - (71,063) (71,063)

Amortisation charge for the year - - (15,868) (57,585) - (73,453) (21,471)

Proceeds/Deposits on sale of land - - - - - - (38,504)

At June 30 85,547 82,284 - 103,111 601,554 872,496 776,435

(a) The compensation payments for centralisation, in accordance with the provisions of the Blue Print relating to the closure of Constance La Gaiété Sugar Factory are recoverable from the sale proceeds of freehold land.

(b) Net expenditure incurred, following closure of Mon Désert Alma Sugar Factory in financial year 2007/08, comprises compensation payments and provision for land development costs less refunds received from the Mauritius Sugar Reform Trust. This expenditure is amortised over a period of 6 years. The Company has the right to sell freehold land to recoup the compensation payments.

(c) The Blue Print costs comprise of compensation payments, provision for land infrastructure and other costs less refunds received from the Mauritius Sugar Reform Trust. The net expenses are amortised over a period of 6 years.

THE GROUP 2013 2012 Current Rs’000 Rs’000

Expenses incurred during the year 210,116 128,122

Expenditure incurred during the year, the benefit of which will be derived in the subsequent crop season, has been accounted as deferred expenses.



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15. BEARER BIOLOGICAL ASSETS


COST At July 1, 500,718 390,918 186,520 168,907 Amalgamation adjustment 433,804 - 433,359 - Additions during the year 208,281 131,178 106,292 34,460 Less: Fully amortised assets (21,305) (49,973) (18,377) (16,847) Exchange difference (4,975) 26,235 - -

At June 30, 1,116,523 498,358 707,794 186,520

AMORTISATION At July 1, 172,712 133,238 69,466 62,183 Amalgamation adjustment 277,002 - 277,002 Amortisation charge for the year 137,291 79,534 61,735 24,130 Less: Fully amortised assets (21,305) (49,973) (18,377) (16,847) Exchange difference (1,855) 7,553 - -

At June 30, 563,845 170,352 389,826 69,466

NET BOOK vALUES 552,678 328,006 317,968 117,054

Bearer biological assets represent cane replantation expenditure for canes that have an expected life cycle of 4 years and 7 years for TPC Ltd and Alteo Limited respectively, as they would normally generate 4 - 7 years of crop harvest. There exists a market for cane tops, when sold in limited quantities. Such biological assets on a large scale do not have a market value and alternative estimates of fair value would be unreliable, hence these biological assets are measured at cost (direct costs incurred including cost of purchase if any) less any accumulated depreciation and any accumulated impairment losses.

Bearer biological assets also include flower replantation expenditure that have an expected life cycle of 7 years for World Tropical Ltd, as they would normally generate 7 years of crop harvest.

In line with IAS 41 - Agriculture, the replantation costs are deferred and amortised over 4 - 7 years.

16. NON-CURRENT RECEIvABLES


Loans to subsidiary companies (note 16(a)) - - 504,205 494,719 Loans to joint ventures (note 16(a)) - 1,100 - 1,100 Other non-current receivables 1,619 5,519 - -

1,619 6,619 504,205 495,819

(a) Loans to subsidiary companies and joint ventures are interest free and have no fixed repayment terms.


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18. DEFERRED INCOME TAXES (cont’d)

(a) THE GROUP (cont’d)

2013 2012 Rs’000 Rs’000

Movement in deferred income tax At July 1, 686,934 1,215,618 Amalgamation Adjustment 124,685 - Movement in income statement (note 23(b)) 32,069 107,147 Deferred tax on revaluation of land (note 18(c)) - (687,938) Deferred tax relating to fair value of the investment property (note 18(c)) - (12,596) Exchange difference (8,033) 64,703

At June 30, 835,655 686,934

Deferred tax assets and liabilities and deferred tax charge in the income statement are attributable to the following items:

Foreign Charge to At July 1, exchange Amalgamation the Income At June 30, 2012 difference Adjustment Statement 2013 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Deferred income tax liabilities Biological assets 438,352 (6,858) - 60,468 491,962 Accumulated tax depreciation 366,755 (268) 158,172 (28,360) 496,299

805,107 (7,126) 158,172 32,108 988,261

Deferred income tax assets Tax losses carried forward (77,203) (1,399) (23,093) 6,755 (94,940) Retirement benefit obligations (23,175) 281 (13,370) (11,813) (48,077) Deferred milling expenses - - (2,857) 3,954 1,097 Deferred expenditure - - 5,833 (5,833) - Interest deferred (17,795) 211 - 6,898 (10,686)

(118,173) (907) (33,487) (39) (152,606)

Net deferred income tax liabilities 686,934 (8,033) 124,685 32,069 835,655

At the end of the reporting period, the Group had unused tax losses of Rs 1,442,311,000 (2012: Rs 784,299,000 ) available for offset against future profits. A deferred tax asset has been recognised in respect of Rs 565,841,000 (2012: Rs 514,686,000) of such losses. No deferred tax asset has been recognised in respect of the remaining Rs 876,470,000(2012: Rs 269,613,000) due to unpredictability of future profit streams.



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17. DEFERRED EXPENDITURE (cont’d)

THE COMPANY

Retirement Land Scheme Development Total Total Costs Costs 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000

Non-current

At July 1, 52,829 - 52,829 10,281 Amalgamation adjustment 26,992 146,486 173,478 - Expenditure incurred during the year - 28,818 28,818 - Additional provision made during the year 80,875 - 80,875 64,019 Released to statements of comprehensive income on sale of land - (19,196) (19,196) - Reversal of overprovision made in previous years - (71,063) (71,063) - Amortisation (57,585) - (57,585) (21,471)

At June 30, 103,111 85,045 188,156 52,829

The Voluntary Retirement Scheme costs comprise of compensation payments, provision for land infrastructure and other costs less refunds received from the Mauritius Sugar Reform trust. The net expenses are amortised over a period of 6 years.

THE COMPANY 2013 2012 Rs’000 Rs’000

Current

Expenses incurred during the year 33,083 16,211

Expenditure incurred during the year, the benefit of which will be derived in the subsequent crop season, has been accounted as deferred expenses.

18. DEFERRED INCOME TAXES

Deferred income taxes are calculated on all temporary differences under the liability methods at 15%/30% for the Group (2012:15%/30%), and 15% for the Company (2012: 15%). Deferred income tax assets and liabilities are offset when the income taxes relate to the same fiscal authority.

(a) THE GROUP

The following amounts are shown net in the statement of financial position:

2013 2012 Rs’000 Rs’000

Deferred tax liabilities 873,305 702,406 Deferred tax assets (37,650) (15,472)

835,655 686,934


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19. INvENTORIES


Raw materials and spare parts 493,006 263,394 43,061 10,263 Raw sugar 42,006 16,928 - - Coal 44,975 11,776 - - IRS residences - 50,519 - -

Total 579,987 342,617 43,061 10,263

(i) The cost of inventories recognised as expense and included in operating expenses amounted to Rs 1,582,326,000 (2012: Rs 1,209,172,000) for the Group and Rs 267,672,481 (2012: Rs 113,480,000) for the Company.

(ii) Borrowings are secured by floating charges on the assets of the Group and the Company, including inventories (note 27).

20. WORK IN PROGRESS

THE GROUP 2013 2012 Rs’000 Rs’000

IRS residences 181,761 67,720

Borrowings are secured by floating charges on the assets of the Group, including work in progress (note 27).

21. CONSUMABLE BIOLOGICAL ASSETS


At July 1, 1,621,602 1,144,741 352,546 329,998 Amalgamation adjustment 550,861 - 550,861 - Gain in fair value 284,115 362,555 110,841 22,548 Exchange difference (19,474) 114,306 - -

At June 30, 2,437,104 1,621,602 1,014,248 352,546



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18. DEFERRED INCOME TAXES (cont’d)

(b) THE COMPANY 2013 2012 Rs’000 Rs’000

At July 1, (3,952) 699,653 Amalgamation adjustment 46,365 - Movement in income statement (note 23(b)) (68,410) (3,071) Deferred tax on revaluation of land (note 18 (c)) - (687,938) Deferred tax relating to fair value of the investment property (note 18(c)) - (12,596)

At June 30, (25,997) (3,952)

Deferred tax assets and liabilities, deferred tax charge in the income statements and deferred tax charge in equity are attributable to the following items:

Charge to the At July 1, Amalgamation Income At June 30, 2012 Adjustment Statement 2013 Rs’000 Rs’000 Rs’000 Rs’000

Deferred income tax liabilities Accelerated tax depreciation 26,149 55,956 (57,715) 24,390

26,149 55,956 (57,715) 24,390

Deferred income tax assets Tax losses carried forward (14,526) - (2,755) (17,281) Retirement benefit obligations (15,575) (9,591) (7,940) (33,106)

(30,101) (9,591) (10,695) (50,387)

Net deferred income tax (assets)/ liabilities (3,952) 46,365 (68,410) (25,997)

At the end of the reporting period, the Company had unused tax losses of Rs 115,207,000 (2012: Rs 96,840,000) available for offset against future profits for which a deferred tax asset has been recognised.

(c) Deferred tax liability on land

In the budget speech on November 4, 2011, the Minister of Finance announced the abolition of capital gains tax on immovable property. Consequently deferred tax liability with regards to deferred tax on land provided for has been transferred back to revaluation and other reserves.


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23. INCOME TAX (cont’d)


Less: Tax refund 1,953 - - Tax paid (360,748) (389,983) - - Over provision transferred 1,970 (259) - - Exchange difference 401 (1,047) - - (356,424) (391,289) - -

At June 30, (13,892) (42,623) 5,269 -

Disclosed as follows: Current tax assets (38,962) (47,158) - - Current tax liabilities 25,070 4,535 5,269 -

(13,892) (42,623) 5,269 -

(b) Income statement

Current tax on the adjusted profit for the year (15% / 30% for the Group and 15% for the Company) 308,986 315,316 - - National Residential Property tax - - - Withholding tax 69,990 66,196 5,269 - Deferred tax (note 18) 32,069 107,147 (68,410) (3,071) Over provision in previous year 1,970 (259) - -

Tax charge/(credit) for the year 413,015 488,400 (63,141) (3,071)

(c) The tax on the Group’s profit before tax differs from the theoretical amount that would arise using the basic rate of the group as follows:


Profit before share of results of associates and joint ventures and taxation: 1,627,831 1,210,729 558,778 (72,888)

Tax at 15%/30% for the group and 15% for the company 432,970 387,686 83,817 (10,933) Withholding tax 69,990 66,196 5,269 Income not subject to tax (33,282) - (135,121) (42,265) Expenses not deductible for tax purposes 51,678 84,276 32,874 50,127 Net tax losses utilised (7,177) (56) (3,635) - Tax losses for which no deferred tax was recognised 24,893 25,930 - - Over provision in previous year 1,970 (259) - - Amalgamation adjustment (46,864) - (46,345) Foreign tax credit (75,735) (74,388) - - Others (5,428) (985) - -

Tax charge/(credit) for the year 413,015 488,400 (63,141) (3,071)



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22. TRADE AND OTHER RECEIvABLES


Trade receivables 275,514 62,934 30,549 - Prepayments and other receivables 314,946 215,070 89,798 41,860 Receivable from related companies - subsidiary companies - - 226,589 50,229 - related parties 17,319 8,677 8,623 8,677

607,779 286,681 355,559 100,766

The carrying amounts of trade and other receivables approximate their fair values. At June 30, 2013, no trade receivables were past due or impaired (2012: Rs Nil). The carrying amounts of the Group’s and Company’s trade and other receivables are denominated in the following currencies.


Mauritian Rupee 475,938 211,597 355,559 100,766 Tanzanian Shilling 27,460 66,884 - - US Dollar 4 8,200 - - Euro 104,377 -

607,779 286,681 355,559 100,766

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.

23. INCOME TAX


(a) Statement of financial position

At July 1, (42,623) (32,846) - -

Movement during the year: Amalgamation adjustment 6,179 - - - Current tax on the adjusted profit for the year

(15% / 30% for the Group and 15% for the Company) 308,986 315,316 - - Withholding tax 69,990 66,196 5,269 -

385,155 381,512 5,269 -


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25. REvALUATION AND OTHER RESERvES


Revaluation and other reserves may be analysed as follows:

Profit on disposal of property, plant and equipment reserve

At July 1, and at June 30, - - 213,079 213,079

Reserve on consolidation At July 1, and at June 30, 4,684 4,684 - -

Associates and joint ventures reserves At July 1, (77,162) (86,397) - - Movement during the year (12,456) 9,235 -

At June 30, (89,618) (77,162) - -

Revaluation surplus At July 1, 3,910,282 4,097,828 3,691,455 3,879,001 Movement during the year 1,368,474 (187,546) 1,335,518 (187,546)

At June 30, 5,278,756 3,910,282 5,026,973 3,691,455

Fair value reserve At July 1, 36,102 43,085 4,976,301 33,820 Movement during the year (18,148) (6,983) 537,309 4,942,481

At June 30, 17,954 36,102 5,513,610 4,976,301

Translation reserve At July 1, (178,137) (279,671) - - Movement during the year 1,053 101,534 - -

At June 30, (177,084) (178,137) - -

Amalgamation reserve At July 1, 3,800 3,800 - - Movement during the year (459,450) - 682,257 -

At June 30, (455,650) 3,800 682,257 -

At June 30, 4,579,042 3,699,569 11,435,919 8,880,835

Profit on disposal of property, plant and equipment reserve

The profit on disposal of property, plant and equipment reserve arose prior to the year 2000 upon disposal of property, plant and equipment.

Reserve on consolidation

Reserve on consolidation represents reserve that arises on consolidation of subsidiaries.

Associates and joint ventures reserves

The associates and joint ventures reserve relates to the Group’s share of associates and joint ventures reserves.

Revaluation surplus

The revaluation surplus relates to the revaluation of property, plant and equipment.



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24. SHARE CAPITAL

THE GROUP AND THE COMPANY

Number of shares Rs’000

Ordinary Shares

At July 01, 2012 186,986,700 1,869,867 Issue of new ordinary shares of no par value to Ex FUEL’s shareholders (note 24(a) ) 131,505,420 7,121,728

At June 30, 2013 318,492,120 8,991,595

(a) Upon the completion of the amalgamation of FUEL with and into ALTEO:

- all of the existing 186,986,700 ordinary shares of Rs 10.00 each of ALTEO were converted into ordinary shares of no par value; and

- 131,505,420 new ordinary shares of no par value were issued and allotted to the former shareholders of Ex FUEL for a consideration other than cash totalling Rs 7,121,728,000.

As a result of the above, the stated capital of ALTEO stands at Rs 8,991,595,000.- divided into 318,492,120 ordinary shares of no par value.


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27. BORROWINGS (cont’d)

(c) Bank loans

The bank loans are secured by floating charges on the group’s assets and bear interest at rates between 3.75% and 9.90% per annum.


The maturity of non-current bank loans are as follows: - After one year and before two years 526,412 273,410 137,003 121,572 - After two years and before five years 1,069,072 697,752 292,996 272,680 - After five years 161,250 281,120 123,215 232,857

1,756,734 1,252,282 553,214 627,109


(d) Finance leases

Minimum lease payments Not later than one year 26,301 5,665 14,382 4,029 Later than 1 year and not later than 2 years 23,657 5,360 11,744 4,033 Later than 2 years and not later than 5 years 56,971 9,952 22,568 8,187 Later than 5 years 1,635 - - - Future finance charges on finance leases (16,991) (3,573) (6,909) (2,915)

Present value of finance lease liabilities 91,573 17,404 41,785 13,334

The present value of finance lease liabilities may be analysed as follows:


Not later than one year 20,109 4,182 11,504 2,870 Later than 1 year and not later than 2 years 18,826 4,279 9,636 3,149 Later than 2 years and not later than 5 years 51,089 8,943 20,645 7,315 Later than 5 years 1,549 - - -

91,573 17,404 41,785 13,334

The finance leases bear interest rates between 7.70% to 9.76% per annum.

Lease liabilities are effectively secured as the rights to the leased asset revert to the lessor in the event of default.



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25. REvALUATION AND OTHER RESERvES (cont’d)

Fair value reserve

Fair value reserve comprises the cumulative net change in the fair value of available-for-sale financial assets that has been recognised in other comprehensive income until the investments are derecognised.

Translation reserve

The translation reserve comprises all foreign currency differences arising from the translation of the financial statements of foreign operations.

Amalgamation reserve

Amalgamation reserve represents the excess of assets over liabilities and reserves of subsidiaries following amalgamation of entities under common control.

26. LOANS

Loans are from other related shareholders in subsidiaries of the Group. The loans are interest free and have no fixed repayment terms.

27. BORROWINGS


Current

Bank overdrafts (note 27(a)) 434,385 297,364 4,238 92,457 Loans at call (note 27(b)) 125,102 92,419 181,744 92,530 Bank loans (note 27(c)) 780,470 442,865 213,626 83,712 Finance leases (note 27(d)) 20,109 4,182 11,504 2,870 Debentures (note 27(e)) 200,000 - 200,000 -

1,560,066 836,830 611,112 271,569

Non-current

Bank loans (note 27(c)) 1,756,734 1,252,282 553,214 627,109 Finance leases (note 27(d)) 71,464 13,222 30,281 10,464 Debentures (note 27(e)) 800,000 - 800,000 -

2,628,198 1,265,504 1,383,495 637,573

Total Borrowings 4,188,264 2,102,334 1,994,607 909,142

(a) The bank overdrafts are secured by floating charges on the Group’s assets and bear interest at rates between 3.75% and 9.65% per annum.

(b) Loans at call are from related parties and bear interest at rates ranging between 5.75% to 6.025% per annum.


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28. RETIREMENT BENEFIT OBLIGATIONS

Retirement benefit obligations comprise mainly the Group’s pension scheme and other post retirement benefits. The Company’s pension scheme is a defined benefit plan and the assets of the plan are invested in unitised funds with the Anglo Mauritius Assurance Society Limited, GML superannuation fund and the Sugar Insurance Pension Fund. Other post retirement benefits relate to gratuities on death and retirement that are based on length of service and salaries at the date of death or retirement.

Pension benefits

(i) The assets of the fund are held independently and administered by an insurance company.

(ii) The amounts recognised in the statement of financial position are as follows:


Present value of funded obligations 830,703 328,069 537,671 243,072 Fair value of plan assets (398,665) (186,243) (269,240) (122,661)

432,038 141,826 268,431 120,411 Present value of unfunded obligations 241,920 192,059 180,883 62,348 Unrecognised actuarial losses (321,310) (136,295) (228,609) (78,938)

Liability in the statement of financial position 352,648 197,590 220,705 103,821

Disclosed as follows: THE GROUP THE COMPANY 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000

Current assets (3,355) (2,922) - - Current liabilities 356,003 200,512 220,705 103,821

352,648 197,590 220,705 103,821



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27. BORROWINGS (cont’d)

(e) Debentures


2013 2012 Rs’000 Rs’000

Secured debentures:

At 4.10% fixed interest rates redeemable in 1 year (June 26, 2014) 200,000 - At 5.40% fixed interest rates redeemable in 3 years (June 26, 2016) 400,000 - At 5.75% fixed interest rates redeemable in 5 years (June 26, 2018) 400,000 - Less: repayable within one year shown as current borrowings (200,000) -

800,000 -

(f) The effective interest rates at the reporting date were as follows:

2013 2012

RS EURO USD TSH RS USD TSH

THE GROUP % % % % % % %

Bank overdrafts 3.75%-9.65% 1.54%-1.61% 13% 13.36% 7.65%-8.375% 8% 13%

Bank borrowings 3.75%-9.9% 1.54%-1.61% 11% 13.36% 6.5%-11.25% N/A 11%

Loans at call 5.75%-6.025% N/A N/A N/A 6.28%-6.88% N/A N/A

Finance lease liabilities 7.70% - 9.76% N/A N/A N/A 8.50% - 13% N/A N/A

THE COMPANY 2013 2012 Rs % %

Bank overdrafts 7.40% - 7.65% 7.65%-8.25% Bank borrowings 6.50%-9.40% 6.5%-9.15% Loans at call 6.00% 6.28%-6.88% Finance lease liabilities 7.70%- 9.76% 8.85%-9.75%

(g) The carrying amounts of the Group’s borrowings are denominated in the following currencies:


Mauritian Rupee (Rs) 3,598,840 1,869,442 1,994,607 909,142 Euro 401,402 20,326 - - US Dollar (USD) 108,133 131,405 - - Tanzanian Shilling (TSH) 79,889 81,161 - -

4,188,264 2,102,334 1,994,607 909,142


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28. RETIREMENT BENEFIT OBLIGATIONS (cont’d)

(v) The amounts recognised in income statement are as follows:


Current service cost 26,663 13,953 14,611 5,926 Interest cost 89,128 59,087 55,306 27,652 Expected return on plan assets (33,423) (18,886) (22,931) (12,454) Scheme expenses 642 496 412 352 Cost of insuring risk benefits 3,092 2,169 2,134 1,565 Net actuarial losses recognised during the year 10,013 6,792 6,546 3,987

Total, included in employee benefit expense 96,115 63,611 56,078 27,028

Actual return on plan assets 28,550 5,085 20,196 3,787

(vi) Major asset categories as percentage of plan assets:

THE GROUP THE COMPANY 2013 2012 2013 2012 % % % %

Local equities 31 12.50 24 12.50 Overseas equities 31 12.50 29 12.50 Fixed interest 30 9.50 40 9.50 Properties 8 7.00 7 7.00

(vii) The assets of the plan are invested in funds. 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 as at the balance sheet date. Expected returns on equity and property investments reflect long-term real rates of return experienced in the respective markets.

(viii) Expected contributions to post-employment benefit plans for the year ending June 30, 2014 are Rs 22,000,000 for the Company and Rs 27,234,000 for the Group.

(ix) Amounts for the current year and previous three years are as follows:

At June 30, At June 30, At June 30, At June 30, 2013 2012 2011 2010 THE GROUP Rs’000 Rs’000 Rs’000 Rs’000

Present value of defined benefit obligation (830,703) (328,069) (309,785) (312,137) Fair value of plan assets 398,665 186,243 186,243 166,596

Deficit (432,038) (141,826) (123,542) (145,541)

Experience adjustments on: - Plan liabilities (150,185) 16,097 (4,323) 21,730 - Plan assets 148 (23,971) 3,162 (174)



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(iii) The movement in the present value of obligations for the year is as follows:


At July 1, 520,128 460,110 305,420 283,694 Amalgamation adjustment 350,442 - 270,405 - Current service cost 26,663 13,953 14,611 5,926 Employee contribution 4,224 1,855 3,004 1,459 Interest cost 89,128 59,087 55,306 27,652 Benefits paid (66,766) (20,825) (48,619) (9,929) Exchange difference (1,587) (10,149) - - Actuarial (gains)/losses 150,391 16,097 118,427 (3,382)

At June 30, 1,072,623 520,128 718,554 305,420

Disclosed as follows: Funded obligations 830,703 328,069 537,671 243,072 Unfunded obligations 241,920 192,059 180,883 62,348

1,072,623 520,128 718,554 305,420

(iv) The movement in the fair value of plan assets for the year is as follows:


At July 1, 186,243 186,243 122,661 122,627 Amalgamation adjustment 181,255 - 133,746 - Contribution by employee 4,224 1,460 3,004 1,459 Scheme expenses (642) (496) (412) (352) Cost of insuring risk benefits (3,092) (2,169) (2,134) (1,565) Expected return on plan assets 33,297 18,886 22,931 12,454 Actuarial gains on plan assets 149 (23,971) 2,295 (16,241) Contribution by employer 54,556 21,873 35,768 14,208 Exchange Difference 238 - - - Transfer (110) - - - Benefits paid (57,453) (15,583) (48,619) (9,929)

At June 30, 398,665 186,243 269,240 122,661


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30. DEFERRED INCOME

THE GROUP 2013 2012 Rs’000 Rs’000

At July 1, 61,674 56,223 Additions during the year 10,290 12,259 Release to statement of comprehensive income (5,184) (6,808)

At June 30, 66,780 61,674

Deferred income may be analysed as follows: Current 7,000 5,006 Non current 59,780 56,668

66,780 61,674

31. DIvIDENDS


2013 2012 Rs’000 Rs’000

Pre bonus issue & conversion of preference shares Interim of Rs.0.30 per share paid (2012: Rs4.00) - ordinary dividend 95,548 35,307 - preference dividend - 2,133

95,548 37,440

Final dividend of Rs.0.45 per share (2012: Rs.0.40) per share paid - ordinary dividend 143,321 74,795

143,321 74,795

Total dividend declared 238,869 112,235

Dividend payable At July 01, - 57,096 Dividend declared during the year, 238,869 112,235 Dividend paid during the year, (95,548) (169,331)

At June 30, 143,321 -



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At June 30, At June 30, At June 30, At June 30, 2013 2012 2011 2010 THE COMPANY Rs’000 Rs’000 Rs’000 Rs’000

Present value of defined benefit obligation (537,671) (243,072) (229,580) (230,001) Fair value of plan assets 269,240 122,661 122,627 108,644

Deficit (268,431) (120,411) (106,953) (121,357)

Experience adjustments on: - Plan liabilities (118,427) (3,382) 6,969 1,414 - Plan assets 2,295 (16,241) (1,020) -

(x) The principal actuarial assumptions used for accounting purposes were:


2013 2012 % %

Discount rate 7.50 9.50 Expected return on plan assets 7.50 10.00 Future salary increases 6.00/5.00 7.50 Future pension increases 3.50/2.00 2.00

29. TRADE AND OTHER PAYABLES


Trade payables 355,057 163,097 55,292 45,405 Payable to related companies - subsidiary companies - - 652,965 14,691 - related company 41,370 3,410 3,000 3,410 Other payables and accrued expenses 550,709 414,617 24,962 16,673 Accruals for centralisation and VRS costs 319,525 91,461 236,979 84,942 Land under development cost 20,503 - 20,503 -

1,287,164 672,585 993,701 165,121

The carrying amounts of trade and other payables approximate their fair values.


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34. EXPENSES BY NATURE


Depreciation on property, plant and equipment on: - owned assets 440,621 235,545 68,615 28,226 - leased assets 9,083 9,766 4,611 8,018 Amortisation of bearer biological assets 137,291 79,534 61,735 24,130 Staff costs 1,398,304 791,199 574,036 204,802 Cost of inventories recognised as expense 1,582,326 1,209,172 267,672 113,480 Management fees 70,861 26,511 40,197 23,541 SIFB premium 57,548 16,850 45,928 9,460 Cultivation and irrigation 371,513 160,537 239,539 105,583 Construction costs 246,870 200,130 - - Factory expenses 182,443 - - - Poultry 109,609 - - - Others 83,471 32,275 - 11,770

4,689,940 2,761,519 1,302,333 529,010

35. OPERATING PROFIT


Operating profit is arrived at after:

crediting

Profit on sale of land - (35,682) (11,416) - Profit on sale of investment property - - - - Profit on sale of available for sale financial assets (8,024) - - - Profit on sale of property, plant and equipment (29,356) (2,952) (5,914) (1,418) Profit on sale of non current asset held for sale - - (700) -

and charging

Depreciation on property, plant and equipment on: - owned assets 440,621 235,545 68,615 28,226 - leased assets 9,083 9,766 4,611 8,018 Amortisation of bearer biological assets 137,291 79,534 61,735 24,130 Lease rentals - motor vehicles Cost of inventories recognised as expense 1,582,326 1,209,172 267,672 113,480 Staff costs (note 35(a)) 1,398,304 791,199 574,036 204,802

(a) Staff costs Wages and salaries 1,151,466 618,150 529,396 176,709 Pension costs 246,838 173,049 44,640 28,093

1,398,304 791,199 574,036 204,802



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32. TURNOvER


Sugar 3,840,258 2,708,969 1,157,971 355,736 Special sugars premium 104,904 81,494 - - Molasses 117,893 58,473 54,384 15,346 Distillers contribution 17,922 5,505 17,887 5,475 Bagasse 4,083 1,394 4,069 1,380

4,085,060 2,855,835 1,234,311 377,937 Electricity generation 1,192,987 352,524 - - Proceeds from sale of real estates

(recognised on completion) 205,797 317,538 - - Golf revenue 92,976 90,211 - - Flower production and export 55,937 57,327 - - Refined service fees 183,193 - - - Services to planters 113,948 - - - Poultry 134,965 - - - Others 1,444 - - -

6,066,307 3,673,435 1,234,311 377,937

33. OTHER OPERATING INCOME


Management fees - - 86,717 19,279 Rent and transport 72,173 16,245 58,774 29,081 Profit on sale of property, plant and equipment 9,529 1,418 5,914 1,418 Agricultural diversification 29,264 16,651 29,264 16,651 Profit on sale of land 31,522 35,682 11,416 - Mutual exchange agreement 35,154 - - - Others 69,403 19,505 30,936 7,127

247,045 89,501 223,021 73,556


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39. NOTES TO STATEMENT OF CASH FLOWS


(a) Cash generated from operations Profit before tax 1,820,578 1,188,761 558,778 (72,888) Adjustments for: Impairment of investment in joint ventures and investment in subsidiary - - 20,000 221,126 Impairment of goodwill on acquisition of

subsidiaries 20,000 24,382 - - Release of deferred income (5,184) - - - Gain on fair value remeasurement (46,636) - - - Increase in fair value of investment property (108,971) - (141,927) - Depreciation of property, plant and equipment 449,704 245,311 73,226 36,244 Amortisation of bearer biological assets 137,291 79,534 61,735 24,130 Amortisation of deferred expenditure 73,453 21,471 57,585 21,471 Profit on sale of land and building (31,650) (35,682) - - Profit on sale of investment property (30,146) - - - Profit on sale of available for sale financial assets (8,024) - - - Profit on sale of property, plant and equipment (40,772) (2,952) (17,330) (1,418) Profit on sale of non current asset held for sale - - (700) - Relocation costs (6,006) - - - Investment income (6,942) (21,283) (414,733) (262,521) Interest expense 338,626 176,801 192,691 71,213 Exchange difference 959 109,809 - Retirement benefit obligations 25,529 41,167 15,281 12,821 Share of results of associates (2,182) (15,220) - - Share of results of joint ventures (102,133) 12,806 - - Amalgamation adjustment 46,689 - - - Changes in working capital: - fair value of consumable biological assets (284,115) (476,861) (110,841) (22,548) - trade and other receivables (321,098) (22,112) 131,445 16,488 - inventories (266,492) 40,947 (919) 992 - trade and other payables 522,483 80,058 227,000 14,752 - deferred expenditure-non current 355,819 161,905 71,063 4,672 - deferred expenditure-current (81,994) - (16,872) - - work in progress (112,933) 37,498 - -

Cash generated from operations 2,335,853 1,646,340 705,482 64,534


(b) Cash and cash equivalents Short term deposits 2,545 20,937 31,416 219 Cash in hand and at bank 412,993 105,152 209,346 2,584 Bank overdrafts (434,388) (297,364) (4,238) (92,457) Loans at call (125,102) (92,419) (181,744) (92,530)

At June 30, (143,952) (263,694) 54,780 (182,184)



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36. INvESTMENT AND OTHER INCOME


Interest income 4,978 18,583 3,725 2,833 Dividend income 1,964 2,700 411,008 259,688

6,942 21,283 414,733 262,521

37. FINANCE COSTS


Foreign exchange transaction losses/(gains) (15,558) 13,745 (5,707) (8,978)

Interest expense:

- Bank and other loans 304,768 167,503 177,044 69,231 - Bank overdrafts 29,657 7,770 7,051 977 - Finance leases 4,201 1,528 2,568 1,005 - Others - - 6,028 -

338,626 176,801 192,691 71,213

323,068 190,546 186,984 62,235

38. EARNINGS PER SHARE


Basic earnings per share Rs 2.61 0.89 1.95 (0.39)

Based on: Profit after tax, minority interest and after preference dividends (Rs’000) 830,622 166,402 621,919 (71,950) Weighted average number of

ordinary shares in issue 318,492,120 186,611,616 318,492,120 186,611,616


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42. CONTINGENT LIABILITIES


Bank Guarantees 1,037,345 57,360 251,429 3,130

THE COMPANY

(a) The Company has received income tax assessments totalling Rs 55.6m in respect of the years of assessment 2006/2007, 2007/2008 and 2009/2009. It has filed an objection to the assessment in accordance with the provisions of the Income Tax Act.

The Company is of the opinion that the tax liability will not crystallise in the foreseeable future since it has strong support based on legal and tax advice.

(b) The Company has provided financial guarantee for an amount of USD 8.3m in the context of a sponsor substitution agreement to the senior lenders of Companhia de Sena SARL. The Company also provided an additional guarantee for a USD 6m overdraft facility granted by Mauritius Commercial Bank to Companhia de Sena SARL. Both guarantees are in the process of being erased.

THE GROUP

In addition to the above claim, the Group has also the following additional contingent liabilities:

(a) An assessment has been raised by the Tanzania Revenue Authority (TRA) in connection with the corporation tax filed and paid by one of the subsidiary, TPC Ltd, for the financial years ended June 30, 2004, 2005 and 2006. In the assessment, some expenses incurred in the production of income have been disallowed for tax purposes by the TRA, resulting into a significant potential liability for the Group. TPC has submitted a notice of objection to the TRA assessment of Tshs.3.34 billion (Rs 63,300,952). TPC is confident that the tax liability will not crystallise in the foreseeable future due to strong support based on legal and tax advice.

(b) Following a reassessment of income tax computations for the years of assessments 2007/2008 and 2008/2009, Alteo Energy Ltd has been assessed to additional income tax of Rs 15,029,681 including interest. These income tax assessments liabilities are being contested in the Assessment Review Committee and the directors have no clear indication of the outcome at this stage.

(c) During the year, Compagnie Usiniere de Mon Loisir Ltee, a subsidiary company, has received a claim for compensation from the Central Electricity Board for breach of contract further to the closure of Mon Loisir sugar factory. The claim amounts to Rs270m and is disputed by the company.

(d) The Mauritius Revenue Authority (MRA) has a claim against Anahita Estates Ltd regarding taxation unpaid on deemed interest on the long term loan receivable from its subsidiary, Anahita Golf Ltd for the years 2007 to 2010 to which Anahita Estates Ltd is not agreeable. The claim, including interest and penalty charges, amounts to Rs.20,403,833 and is disputed by the company.



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39. NOTES TO STATEMENT OF CASH FLOWS (cont’d)

(c) Non cash transaction

The non cash transaction relates to the conversion of long term loan into bank overdrafts in 2012.

40. OPERATING LEASE COMMITMENTS

The Group leases vehicles under non-cancellable operating lease agreements. The leases have varying terms, escalation clauses and renewal rights.

Operating Lease Commitments - Where the Company is the Lessee

The future aggregate minimum lease payments under non-cancellable operating leases are as follows:


Not later than one year 315 10,565 315 - Later than one year and not later than five years 289 - 289 -

604 10,565 604 -

Operating Lease Commitments - Where the Company is the Lessor

The future aggregate minimum lease payments under non-cancellable operating leases are as follows:


Not later than one year 2,366 10,565 5,366 - Later than one year and not later than five years 9,464 - 21,465 - Later than 5 years 179,818 403,136

191,648 10,565 429,967 -

41. CAPITAL COMMITMENTS


Capital expenditure approved by the Board : - contracted 152,833 - - - - not contracted 303,714 495,510 254,304 68,132

456,547 495,510 254,304 68,132


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43. RELATED PARTY TRANSACTIONS

(a) THE GROUP

Sale/(Purchase) of Investment income/ Management fees Loans at call goods and services (expense) receivable/(payable) (from)/to Amount owed to Amount due from

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Associates - - - 1,700 - - - - - - - -

Joint Ventures (56,075) (139,999) (578) 58,113 - - (13,869) (3,204) 22,391 6,556 27,534 14,880

Companies with common Directors (46,444) (27,663) (7,127) (355) - 57,038 (62,779) (89,215) 6,225 12,007 9,805 2,661

Major Shareholders - - - - - - - 68,622 - - -

Total (102,519) (167,662) (7,705) 59,458 - 57,038 (76,648) (92,419) 97,238 18,563 37,339 17,541

The above transactions have been made at arms’ length, on normal commercial terms and in the normal course of business.

(b) THE COMPANY

Sale/(Purchase) of Investment income/ Management fees Loans at call goods and services (expense) receivable/(payable) (from)/to Amount owed to Amount due from

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Subsidiaries 93,316 13,637 (17,547) 4,686 81,567 19,192 (34,183) 109 653,761 15,141 731,158 541,199

Related company - - - - - - (62,274) - - - - -

Joint ventures - - (578) (3,851) - - (13,869) (3,203) 3,000 2,962 9,620 13,527

Companies with common Directors (16,523) (9,391) (6,565) - (40,197) (43,607) (2) (89,216) - - 4,993 2,661

Major Shareholders - - - - - - - - 68,622 - - -

Total 76,793 4,246 (24,690) 835 41,370 (24,415) (110,328) (92,310) 725,383 18,103 745,771 557,387

The above transactions have been made at arms’ length, on normal commercial terms and in the normal course of business.



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(c) Key management personnel compensation


Salaries and short-term employee benefits 58,915 33,312 39,108 22,733 Post-employment benefits 5,290 3,066 4,271 3,066


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45. BUSINESS COMBINATIONS (cont’d)

(b) 35 Sociétés

On December 29, 2012, Alteo Limited has amalgamated with 35 Sociétés in accordance with and pursuant to the provisions of the Companies Act 2001.

The terms of the amalgamation are as follows:

(i) The continuing company is Alteo Limited;

The fair value of assets and liabilities at the date of amalgamation were as follows:

Rs’000

Property, plant and equipment 653,260 Deferred expenditure 91,938 Bearer biological assets 49,142 Consumable biological assets 125,174 Investment in subsidiary companies 9,851 Trade and other receivables 111,212 Bank & Cash Balances 4,371 Borrowings (92,591) Retirement benefit obligations (37,663) Trade and other payables (256,981)

Fair value of net asset amalgamated 657,713 Less: Cost of investment 793,143

Amalgamation adjustment (135,430)



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45. BUSINESS COMBINATIONS

(a) Flacq Union Estates Limited

On July 20, 2012, Alteo Limited amalgamated with Flacq Union Estates ltd in accordance with and pursuant to the provisions of the Companies Act 2001.

The terms of the amalgamation are as follows:

(i) The continuing company is Alteo Ltd;

(ii) The share exchange ratio is zero decimal eight night six five (0.8965) new DRBC share for every one (1) FUEL share;

The fair value of assets and liabilities at the date of amalgamation were as follows:

Rs’000

Property, plant and equipment 5,180,775 Investment properties 895,391 Investments in subsidiaries 2,327,449 Investments in associates 251,326 Investments in securities 88,701 Deferred expenditure 81,540 Deferred tax liabilities (46,364) Biological assets - Bearer Biological Assets 107,215 Non-current receivables 24,802 Biological assets - Consummable Biological Assets 425,688 Inventories 31,879 Trade and other receivables 270,999 Cash in hand and at bank 15,278 Borrowings (1,273,711) Retirement benefit obligations (63,940) Trade and other payables (377,613)

Fair value of net asset amalgamated 7,939,415 Less: Issue of ordinary shares of no par value to Ex FUEL’s shareholders (7,121,728)

Amalgamation adjustment 817,687


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47. THREE YEAR FINANCIAL SUMMARY (cont’d)

(a) Statement of financial position

2013 2012 2011 Rs’000 Rs’000 Rs’000

ASSETS Non-current assets 20,788,051 9,871,001 9,545,302 Current assets 4,471,247 2,619,989 2,341,220 Non-current assets classified as held for sale 171,249 - -

Total assets 25,430,547 12,490,990 11,886,522

EQUITY AND LIABILITIES Capital and reserves 16,111,799 7,213,660 6,362,390 Loans 55,951 44,488 44,637 Non-Controlling interests 2,322,890 1,488,796 1,162,021

Total equity 18,490,640 8,746,944 7,569,048

LIABILITIES Non-current liabilities 3,917,286 2,168,422 3,123,078 Current liabilities 3,022,621 1,575,624 1,194,396

Total liabilities 6,939,907 3,744,046 4,317,474

Total equity and liabilities 25,430,547 12,490,990 11,886,522



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47. THREE YEAR FINANCIAL SUMMARY

2013 2012 2011 Rs’000 Rs’000 Rs’000

THE GROUP

(a) Results Turnover 6,066,307 3,673,435 3,263,127 Share of results of joint ventures 102,133 (12,806) (79,743) Share of results of associates 2,182 15,220 6,557 Profit before taxation 1,820,578 1,188,761 998,751 Income tax expense (413,015) (488,400) (335,106)

Profit for the year 1,407,563 700,361 663,645 Other comprehensive income for the year, net of tax 1,341,209 920,754 (1,046,230)

Total comprehensive income for the year 2,748,772 1,621,115 (382,585)

Profit attributable to: - Owners of the parent 830,622 168,535 309,684 - Non-Controlling interests 576,941 531,826 353,961

1,407,563 700,361 663,645

Total comprehensive income attributable to: - Owners of the parent 2,169,545 972,855 (529,164) - Non-Controlling interests 579,227 648,260 146,579

2,748,772 1,621,115 (382,585)

Earnings per share (Rs) 2.61 0.89 34.57

Adjusted earnings per share (Rs)* 1.64

*Adjusted for bonus issue of 177,637,365 shares issued during 2012.


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Sugarcane Growing ,Sugar Milling & Refinery Power Generation Property Development Others Eliminations Total

Mauritius Tanzania Mauritius Mauritius Mauritius

2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Segment revenue 2,118,468 704,661 2,149,785 2,151,174 1,192,987 352,524 205,797 317,538 399,270 147,538 - - 6,066,307 3,673,435

Segment profit/(loss) 592,629 26,881 1,196,122 1,459,504 208,384 (4,524) (97,031) (69,903) 50,027 (31,036) (59,253) - 1,890,878 1,380,922 Share of results of associates net of tax - 13,923 - - - - - - 2,182 1,297 - - 2,182 15,220 Share of results of joint ventures - - - - - - - - 102,133 (12,806) - - 102,133 (12,806) Investment and other income - net 9,270 - 258 18,912 - 325 - 132 (2,586) 1,914 - - 6,942 21,283 VRS and centralisation amortisation (73,453) (21,471) - - - - - - - - - - (73,453) (21,471) Gain on fair value of investment property 108,971 - - - - - - - - - - - 108,971 - Impairment of goodwill on

acquisition of subsidiary (20,000) (24,382) - - - - - - - - - - (20,000) (24,382) Exceptional items 61,796 - - - - - - - - - - - 61,796 - Gain on fair value of remesurement

from associate to subs 46,636 - - - - - - - - - - - 46,636 - Finance costs - net (198,899) (11,785) (2,085) (40,306) (28,416) (1,402) (71,091) (120,819) (37,672) (16,234) 15,095 - (323,068) (190,546)

(Loss)/Profit before tax 526,950 (16,834) 1,194,295 1,438,110 179,968 (5,601) (168,122) (190,590) 114,084 (56,865) (44,158) - 1,803,017 1,168,220 Tax 28,865 (7,848) (409,928) (480,022) (28,082) 772 - (3,870) (1,302) - (413,015) (488,400)

Group profit/(loss) 555,815 (24,682) 784,367 958,088 151,886 (4,829) (168,122) (190,590) 110,214 (58,167) (44,158) - 1,390,002 679,820 Consolidation adjustments 17,561 20,541 17,561 20,541 Minority interest (88,881) (19,586) (433,344) (526,168) (58,173) 4,667 - - 3,457 9,261 (576,941) (531,826)

Profit/(loss) for the year 466,934 (44,268) 351,023 431,920 93,713 (162) (150,561) (170,049) 113,671 (48,906) (44,158) - 830,622 168,535



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48. SEGMENT INFORMATION

The accounting policies of the operating segments are same as those described in the summary of significant accounting policies. Consolidation adjustments represent elimination of intra-group transactions which are entered into under the normal commercial terms and conditions that would be available to unrelated parties. Segment assets consist primarily of property, plant and equipment, intangible assets, inventories, cash and cash equivalents and receivables and exclude investments investments in associates, in joint ventures and investment in other financial assets.

The Group is organised into the following main business segments :-


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48. SEGMENT INFORMATION (cont’d)

Sugarcane Growing and Sugar Milling Power Generation Property Development Others Total Mauritius Tanzania Mauritius Mauritius Mauritius 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Segment assets 27,175,394 6,331,457 3,296,189 3,328,367 1,477,331 435,702 1,259,689 838,290 8,719,870 766,751 41,928,473 11,700,567 Eliminations - - - - - - - - - - (17,529,738) - Associates - 112,183 - - - - - - 46,392 14,771 46,392 126,954 Joint ventures - - - - - - - - 985,420 663,469 985,420 663,469

25,430,547 12,490,990

Segment liabilities 3,931,203 1,351,548 939,005 1,092,210 748,059 128,719 974,631 906,559 347,009 265,010 6,939,907 3,744,046

Capital expenditure 260,999 90,558 244,653 203,590 113,766 28,501 - - 66,024 6,994 685,442 329,643 Depreciation 189,800 63,940 139,111 119,470 91,191 40,845 - - 29,602 21,056 449,704 245,311



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Geographical information

The Group’s three business segments are managed locally and operate in the following main geographical areas:

Sales Total assets Capital expenditure 2013 2012 2013 2012 2013 2012 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000 Rs’000

Mauritius 3,916,522 1,522,261 22,134,358 9,162,623 440,789 126,053 Tanzania 2,149,785 2,151,174 3,296,189 3,328,367 244,653 203,590

6,066,307 3,673,435 25,430,547 12,490,990 685,442 329,643

Sales revenue is based on the country in which the customer is located. Total assets and Capital expenditure are shown by the geographical area in which assets are located.

Analysis of sales 2013 2012 Rs’000 Rs’000

Sale of sugar, molasses and bagasse 4,268,253 2,855,835 Sale of electricity 1,192,987 352,524 Tourism 205,797 317,538 Golf revenue 92,976 90,211 Sales of goods 306,294 57,327

6,066,307 3,673,435



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NOTES

I/We,

of

being a member/members of Alteo Limited (“the Company”), do hereby appoint:

of

or failing him/her,

of

or failing him/her the Chairman of the Meeting, as my/our proxy to represent me/us and vote for me/us and on my/our behalf at the Annual Meeting of the Company to be held at Henessy Park Hotel, Ebony Conference Room, 65 Ebène Cybercity, Ebène on Wednesday, December 18, 2013 at 10.00 hours and at any adjournment thereof.

I/We direct my/our proxy to vote in the following manner (please vote with a tick):

ORDINARY RESOLUTIONS FOR AGAINST ABSTAIN

1. To consider the Annual Report 2013 of the Company.

2. To receive the report of BDO & Co, the auditors of the Company.

3.To consider and adopt the Group’s and Company’s audited financial statements for the year ended June 30, 2013.

4.

To re-elect, on the recommendation of the Corporate Governance Committee, as Director to hold office until the next Annual Meeting, in accordance with Section 138(6) of the Companies Act 2001, Mr. G. Christian Dalais, who offers himself for re-election.

5-13.

To re-elect, on the recommendation of the Corporate Governance Committee, as Directors of the Company to hold office until the next Annual Meeting, the following persons who offer themselves for re-election (as separate resolutions):5. Mr. Arnaud Lagesse

6. Mr. Jean-Claude Béga

7. Mr. Jan Boullé

8. Mr. Patrick de L. d’Arifat

9. Mr. P. Arnaud Dalais

10. Mr. Amédée Darga

11. Mr. Jean de Fondaumière

12. Mr. Louis Guimbeau

13. Mr. Thierry Lagesse

14.To re-appoint BDO & Co as auditors for the ensuing year and to authorise the Board of Directors to fix their remuneration.

15.To ratify the remuneration paid to the auditors for the financial year ended June 30, 2013.

Signed this day of 2013.

Signature(s)

Notes:

1 Any member of the Company entitled to attend and vote at this meeting may appoint a proxy of his/her own choice to attend and vote on his/her behalf. A proxy need not be a member of the Company.

2 If the instrument appointing the proxy is returned without an indication as to how the proxy shall vote on any particular resolution, the proxy will exercise his/her discretion as to whether, and if so, how he/she votes.

3 The instrument appointing a proxy or any general power of attorney, duly signed, shall be deposited at the Share Registry and Transfer Office of the Company, MCB Registry & Securities Ltd, 2nd Floor, MCB Head Office, 9-11, Sir William Newton Street, Port-Louis by Tuesday, December 17, 2013 at 10.00 hours and in default, the instrument of proxy shall not be treated as valid.

PROXYFORM

By USiNg COCOON OffSET PAPER RAThER ThAN NON-RECyCLEd PAPER, ThE ENviRONmENT imPACT wAS REdUCEd By :

2,499 Kg Of LANdfiLL

369 Kg CO2 Of gREENhOUSE gASES

3,695 Km TRAvEL iN ThE AvERAgE EUROPEAN CAR

51,968 LiTRES Of wATER

4,789 Kwh Of ENERgy

4,060 Kg Of wOOd

SOURCE: CARBON fOOTPRiNT dATA EvALUATEd By LABELiA CONSEiL iN ACCORdANCE wiTh ThE BiLAN CARBONE® mEThOdOLOgy. CALCULATiONS ARE BASEd ON A COmPARiSON BETwEEN ThE RECyCLEd PAPER USEd vERSUS A viRgiN LiBRE PAPER ACCORdiNg TO ThE LATEST EUROPEAN BREf dATA (viRgiN LiBRE PAPER) AvAiLABLE. RESULTS ARE OBTAiNEd ACCORdiNg TO TEChNiCAL iNfORmATiON ANd SUBJECT TO mOdifiCATiON.

ALTEO LimiTEd ANNUAL REPORT 2013

EdiTEd By BEyONd COmmUNiCATiONS LTddESigNEd By i Am AN iSLANd LTd

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i/we,

of being a member/members

of Alteo Limited (“the Company”), do hereby cast my/our vote, by virtue of Clause 18.10 of the Constitution of the Company for the Annual Meeting of the Company to be held at Henessy Park Hotel, Ebony Conference Room, 65 Ebène Cybercity, Ebène on Wednesday, December 18, 2013 at 10.00 hours and at any adjournment thereof.

i/we direct my/our proxy to vote in the following manner (please vote with a tick):

ORDINARY RESOLUTIONS FOR AgAINST AbSTAIN

1. To consider the Annual Report 2013 of the Company.

2. To receive the report of BdO & Co, the auditors of the Company.

3.To consider and adopt the group’s and Company’s audited financial statements for the year ended June 30, 2013.

4.

To re-elect, on the recommendation of the Corporate governance Committee, as director to hold office until the next Annual meeting, in accordance with Section 138(6) of the Companies Act 2001, mr. g. Christian dalais, who offers himself for re-election.

5-13.

To re-elect, on the recommendation of the Corporate governance Committee, as directors of the Company to hold office until the next Annual meeting, the following persons who offer themselves for re-election (as separate resolutions):

5. mr. Arnaud Lagesse

6. mr. Jean-Claude Béga

7. mr. Jan Boullé

8. mr. Patrick de L. d’Arifat

9. mr. P. Arnaud dalais

10. mr. Amédée darga

11. mr. Jean de fondaumière

12. mr. Louis guimbeau

13. mr. Thierry Lagesse

14.To re-appoint BdO & Co as auditors for the ensuing year and to authorise the Board of directors to fix their remuneration.

15.To ratify the remuneration paid to the auditors for the financial year ended June 30, 2013.

Signed this day of 2013.

Signature(s)

Note:

The duly signed postal vote should reach the Share Registry and Transfer Office of the Company, mCB Registry & Securities Ltd, 2nd floor, mCB head Office, 9-11, Sir william Newton Street, Port-Louis forty-eight (48) hours before the start of the meeting and in default, the postal vote shall not be treated as valid.

POSTALvOTE

Alteo limitedRegistered office: vivéa Business park | saint pierre | mauritiusTel: (230) 402 90 50 | fax: (230) 432 07 29

www.alteogroup.com

Documents

Annual Report 2013 - CIEL Group · Alteo Limited - ANNUAL REPORT 2013 page 3 page 2 Alteo Limited - ANNUAL REPORT 2013 NOTICE OF ANNUAL MEETING TO SHAREHOLDERS Notice is hereby given