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NOTES TO THE COMPANY ANNUAL FINANCIAL STATEMENTS
CONTINUED
For the year ended 31 May 2015
210
BLUE LABEL INTEGRATED ANNUAL REPORT 2015
6.
INVESTMENTS IN GROUP COMPANIES AND RELATED LOANS continued
6.1 Investments in and loans to subsidiaries continued
In the current year Viamedia Proprietary Limited was acquired. Refer to note 26 in the Group notes for
details of these acquisitions.
In the current year Blue Label Engage was disposed of for R2.4 million. The loss on disposal of
R333 676 is included in other expenses in the statement of comprehensive income. Refer to note 25
of the Group notes for further details.
2014
R’000
6.2 Investments in and loans to joint ventures and associates
Shares as at the beginning of the year
254 142
164 826
Acquisition of joint venture and associate
50 033
89 316
Shares as at the end of the year
304 175
254 142
Loans at the beginning of the year
1 054
—
Loan granted to joint venture capitalised
(50 033)
(89 316)
Loans granted to joint venture
48 979
86 819
Unrealised foreign exchange profit on loans to joint ventures
—
3 551
Loans at the end of the year
—
1 054
Closing net book value
304 175
255 196
On 10 September 2013 a loan of R85.8 million was advanced to Blue Label Mexico S.A. de C.V. (BLM).
This loan was capitalised on 18 December 2013. The difference of R3.5 million relates to foreign
exchange movements.
There was no impairment of investment in joint ventures. The terminal growth rates applied was 3.5%
(2014: 3.5%). The weighted average cost of capital used to discount these cash flows was 18.46%
(2014: 17.44%). The discount rates used are pre-tax and reflect specific risks relating to the relevant
companies.
The discount rate used when calculating the value-in-use calculations would need to be increased by
2.25% before any impairments would need to be recognised. Refer to note 6 of the Group annual
financial statements.
2015
R’000